Blumberg v. United States

• Decision Date: 13 May 1955
• Docket Number: No. 15146.,15146.
• Citation: 222 F.2d 496
• Parties: Harry H. BLUMBERG, Appellee. v. UNITED STATES of America, Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

222 F.2d 496 (1955)

Harry H. BLUMBERG, Appellee. v. UNITED STATES of America, Appellee.

No. 15146.

United States Court of Appeals Fifth Circuit.

May 13, 1955.

Claude Pepper, Arthur B. Cunningham, Philip T. Weinstein, Miami, Fla., Sidney O. Raphael, New York City, for appellant.

Vernon W. Evans, Jr., Asst. U. S. Atty., Tampa, Fla., James L. Guilmartin, U. S. Atty., Miami, Fla., H. Brian Holland, Asst. Atty. Gen., Ellis N. Slack, John H. Mitchell, Richard B. Buhrman, Sp. Assts. to Atty. Gen., for appellee.

Before HUTCHESON, Chief Judge, and DAWKINS, District Judge.

HUTCHESON, Chief Judge.

Convicted of willfully attempting to defeat and evade federal income taxes owing for the calendar years 1946 and 1947, in violation of Section 145(b), 26 U.S.C., defendant, appealing from the judgment imposing a fine of $20,000 and an imprisonment of three years, is here insisting that the trial was attended with prejudicial error and the judgment may not stand.

The government did not rely in this case upon the net worth and expenditures method of proof, and the defendant did not below, he does not here, dispute the fact that for the years in question he did not report the income which the government witnesses testified was received by him in those years and not reported. On the contrary, conceding that there were omissions and that he is civilly liable for the deficiencies caused thereby, he defended below and defends here on the ground that the omissions were not willful, and he was, therefore, not guilty of the crimes charged.¹

In support of his insistence that the judgment must be reversed for the errors assigned, appellant presents six questions for our decision.² For the reasons hereafter stated as briefly as may be as to each, we are of the clear opinion: that the first, second, fourth and fifth questions should be answered in the negative, and of the equally clear opinion that the third and sixth questions should be answered in the affirmative; and that these errors were greatly prejudicial and require a reversal.

While appellant has briefed with thoroughness and presented with vigor and apparent confidence each question raised, he has devoted a larger portion of his brief to a discussion of the first, second and third questions, presenting the claimed errors in: (1) holding that appellant's books and records had not been secured from him in violation of his rights under the Fourth and Fifth Amendments; (2) not submitting to the jury under an appropriate instruction, whether they were so secured; and (3) admitting irrelevant but highly prejudicial evidence of expenditures and the refusal of special charges made necessary thereby.

We take up the errors presented by the first and second questions to say that we agree with counsel's general propositions, that compulsory production of a taxpayer's books and records for the purpose of use in a criminal prosecution would be violative of constitutional protection against self incrimination, and have many times said so. Cf. White v. U. S., 5 Cir., 194 F.2d 215. We are convinced, however, that the record, including the testimony of the defendant himself, contains no evidence supporting the claim made on this appeal, that the examinations made of him, his books and records were conducted without his consent, and the books and records themselves were obtained from him not voluntarily but by coercion. On the contrary, we think the record is inconsistent with any other theory than that the defendant voluntarily, indeed without reservations of any kind, discussed the matter of his tax liability frankly and fully with the government agents in an effort to reach an agreement as to, and obtain a settlement of that liability.

It is true that there was no express disclosure made that a purpose in obtaining the evidence was to proceed criminally against him. On the other hand, though defendant had undoubtedly hoped, and may have believed, that no criminal prosecution was intended, there was no representation made to him that the information sought was only for purposes of settling his civil liability. Under these circumstances, we think: that there was no obligation on the agents to inform him that the matters inquired about might be used in a criminal proceeding; that it was no breach of his constitutional rights not to so "inform him" and that the matters propounded as error under this question are not such.

Passing the third question for the moment and taking up the fourth, the claimed error in refusing to allow an expert witness to give his opinion as to the character of the accounting services which had been rendered to the appellant during the years in question, we think little need be said about it other than that if the exclusion of the proffered testimony was error, it did not deprive the defendant of substantial evidence making the action prejudicial, and, in the second place, we think the court was correct in ruling that the matter, on which the opinion of the witness was tendered, the quality of the accounting services furnished to appellant during the two years, was not a proper matter for opinion evidence.

When it comes to the fifth question, counsel's statement and argument thereon make it clear that the matters presented under it are more relevant to the general claims of error under the sixth question, the undue intervention of the court in the course of the trial and the prejudice to the defendant arising thereout, than to any particular benefit, of which the claimed restrictions on the particular cross examination had deprived the defendant.

Referring, therefore, to the sixth question, so much of the discussion under the fifth as properly relates to it, and considering the fifth question only as a complaint that defendant was deprived of particular information, we do not believe that a sufficient showing is made of a truly harmful result in the sense of depriving defendant of information to which he was entitled. We do think, though, that treating the interruptions dealt with as matter in point under the sixth general question, they do tend to support the complaint there made.

Coming now to the third question, whether the admission, over defendant's objection, that it was not material to the theory on which the case was tried, of evidence having to do with moneys taken to New York by defendant's wife and with large expenditures made by them in launching an elaborate and expensive wedding party in a New York hotel to fitly celebrate the marriage of their daughter and the son of a prominent New York banker, was erroneous and prejudicial, we have no hesitancy in saying that it was, and that the erroneous admission was emphasized, exaggerated and made greatly more prejudicial³ by the refusal of the court to give defendant's requested charges Nos. 15 and 16, or some similar charge.

The government's attempted avoidance of the error of admitting this highly prejudicial evidence by the statement that the evidence was not offered to prove that these expenditures...