Gerson v. United States

• Decision Date: 14 March 1928
• Docket Number: No. 7708-7710.,7708-7710.
• Citation: 25 F.2d 49
• Parties: GERSON v. UNITED STATES (three cases).
• Court: U.S. Court of Appeals — Eighth Circuit

25 F.2d 49 (1928)

GERSON v. UNITED STATES (three cases).

Nos. 7708-7710.

Circuit Court of Appeals, Eighth Circuit.

March 14, 1928.

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I. J. Ringolsky, of Kansas City, Mo. (McLaury & Hopps and H. F. Tripp, all of Oklahoma City, Okl., and Ringolsky, Friedman & Boatright, M. L. Friedman, and William G. Boatright, all of Kansas City, Mo., on the brief), for plaintiffs in error.

Leslie E. Salter, Asst. U. S. Atty., of Oklahoma City, Okl. (Roy St. Lewis, U. S. Atty., and Fred A. Wagoner, Asst. U. S. Atty., both of Oklahoma City, Okl., on the brief), for the United States.

Before KENYON and BOOTH, Circuit Judges, and MUNGER, District Judge.

KENYON, Circuit Judge.

Plaintiffs in error, Abraham, Nathan, and Ike Gerson, hereafter designated as defendants, were tried and convicted upon an indictment charging them and others with conspiracy to commit an offense against the United States by concealing from the trustee in bankruptcy certain merchandise and cash of the estate of Abraham Gerson. Sentences of two years in the penitentiary and a $1,000 fine were imposed as to each. The case was dismissed as to defendants John R. Snyder and Joseph Broida.

The indictment was seasonably attacked by demurrer and motion to quash, both of which were overruled. At the close of the evidence of the government, demurrers were filed to the evidence on behalf of each of the defendants, on the ground that the same was insufficient to prove the guilt of any of them of the crime charged in the indictment, and it was moved to direct the jury to return verdicts of not guilty. The demurrers and motions were overruled. Defendants elected to stand on the demurrers and introduced no evidence. The jury found a verdict of not guilty as to Phillip Gerson and Clara Gerson.

The facts present a tangled web not easily unraveled. As we must review them at length in our discussion of the sufficiency of the evidence, in the interest of brevity and to present duplication, we omit their presentation here further than to say that plaintiffs in error are brothers, Clara Gerson, one of the acquitted defendants is their mother, and Phillip Gerson, another acquitted defendant, is a brother. Abraham Gerson, commencing in 1923, operated a number of clothing stores at different times and at different places in Oklahoma, being assisted in the operation of some of them by Ike Gerson. Bankruptcy proceedings were commenced against Abraham Gerson in January, 1925, at which time he was operating stores at South Shidler and at Blackwell, Okl. He was duly adjudged a bankrupt.

It is contended that the indictment is insufficient, in that there is no sufficient description of the merchandise and money which it is alleged plaintiffs in error conspired to conceal, and that the indictment does not charge that the kind and character of the merchandise or cash were to the grand jury unknown. This indictment charges as follows:

"That on the 13th day of January, 1925, an involuntary petition in bankruptcy was filed in the United States court for the Western district of Oklahoma against the defendant Abraham Gerson; that thereafter, on the 11th day of February, 1925, said defendant was duly and lawfully adjudged a bankrupt by John J. Hildreth, referee in bankruptcy, to whom said involuntary petition had been referred; that thereafter, and in the regular proceedings of the administration of the said bankrupt estate, one A. L. Smith was duly and legally appointed trustee in bankruptcy for the estate of the said bankrupt, Abraham Gerson, on the 20th day of February, 1925, and he, the said A. L. Smith, so having been duly appointed, then and thereupon duly qualified as such trustee and entered into bond, which said qualification and bond was duly approved by John J. Hildreth, referee in bankruptcy as aforesaid for said district; that the adjudication of him, the said Abraham Gerson, to be a bankrupt, and the appointment and qualification of the said A. L. Smith as such trustee, aforesaid, was well known to him, the said Abraham Gerson, bankrupt; that shortly before the filing of said involuntary petition in bankruptcy, to wit, on or about 1st day of September, 1924, at Shidler, Okl., within the Western district of Oklahoma, the said defendants Abraham Gerson, Ike Gerson, Phillip Gerson, Nathan Gerson, Clara Gerson, John R. Snyder, and Joseph Broida, did unlawfully, willfully, knowingly, and feloniously conspire, combine, confederate, and agree together, and with each other to commit an offense against the United States, in and by corruptly and fraudulently agreeing together as aforesaid, in anticipation of the involuntary bankruptcy of the said Abraham Gerson, to be brought about and accomplished by the said Abraham Gerson, with the knowledge and connivance of the said other conspirators, unlawfully, willfully, knowingly, and fraudulently while the said Abraham Gerson was a bankrupt, to conceal from the trustee in bankruptcy of the said Abraham Gerson, to be thereafter appointed, certain merchandise belonging to the estate in bankruptcy of the said Abraham Gerson, to wit, merchandise of the value of $15,945.47, and the cash received from a sale thereof by the said Abraham Gerson, which said property belonged to the said Abraham Gerson at the time of his adjudication in bankruptcy."

The indictment further sets forth the exact method by which Abraham Gerson, with the knowledge and connivance of the other defendants, was to work out the proposed scheme, which was: To purchase merchandise on credit and hold sales to convert the same into cash, not paying creditors, and only paying such expenses as were absolutely necessary, the money received from the sales to be withheld from his bank account and placed in possession of the other conspirators; that the merchandise was to be removed from store to store and place to place; that no books of account were to be kept; that he should commit acts of bankruptcy to force the filing of a petition in bankruptcy against him; that he should conceal assets in the form of merchandise and cash and omit the same from his schedule of assets filed in the bankrupt proceeding, and should continue to conceal said merchandise and cash from his trustee in bankruptcy; and that, after bankruptcy, a part of the money concealed from the trustee and placed in the hands of the coconspirators should be returned to Abraham Gerson and Ike Gerson and used in the purchase of Abraham Gerson's bankrupt stock.

Are there sufficient earmarks in this indictment to identify the particular crime charged, viz. a conspiracy under section 37 of the Criminal Code (Comp. Stat. § 10201 18 USCA § 88) to commit an offense against the United States by a violation of that part of section 29b of the Bankruptcy Act (11 USCA § 52), reading as follows:

"A person shall be punished, by imprisonment for a period not to exceed two years, upon conviction of the offense of having knowingly and fraudulently (1) concealed while a bankrupt, or after his discharge, from his trustee any of the property belonging to his estate in bankruptcy. * * *"

It is to be noted that the language of the indictment is substantially in the words of the statute. It is not questioned that the allegation of the conspiracy under section 37 of the Criminal Code is sufficient. Of course a conspiracy to commit a crime is a distinct offense from the crime stated as its object. This court said, in Anderson v. United States, 260 F. 557, 558:

"As the conspiracy is the gist of the offense, it is undoubtedly true that the offense which it is charged the defendant conspired to commit need not be stated with that particularity that would be required in an indictment charging the offense itself."

The offense here is the conspiring to fraudulently conceal from the trustee any of the property belonging to the bankrupt's estate, and is an offense against the duty of the bankrupt to turn over the entire estate to the trustee. The amount concealed is not important and does not affect the crime itself, though probably it would be considered by the court in passing sentence as bearing on the moral turpitude involved in the offense. There are difficulties involved by the very nature of the situation in attempting to describe concealed property. It is peculiarly within the knowledge of a defendant as to what property, if any, he has concealed. Here there is an allegation of concealment as to approximately $15,000 of merchandise and the cash received therefrom. The merchandise and cash referred to are, of course, the merchandise and cash involved in the bankruptcy proceeding. The indictment charges Abraham Gerson was moving stocks of goods from one store to another. Those stocks of goods were his merchandise, and while the term "merchandise" is a comprehensive term, it is apparent that the merchandise referred to consisted of the things bought and sold in trade by him in the stores he was conducting. The bankruptcy proceeding as set forth in the indictment is certainly rather a large earmark, and is a circumstance tending to identify the particular offense charged. Bankruptcy proceedings, it is to be presumed, were not started against Abraham Gerson in other places.

In Kanner et al. v. United States (C. C. A.) 21 F.(2d) 285, 287, a somewhat similar indictment was sustained, the court there saying:

"The purpose of the rule being to enable the defendant to prepare his defense, it would seem that, if ever particularity may be dispensed with, it should be so in the crime of concealing assets. The crime is one which is peculiarly within the bankrupt's own knowledge, and one which may be committed under circumstances which render impossible a description of the assets concealed. Where the very essence of the crime is secreting property, how can it be necessary to allege knowledge of that of which the defendant's own acts prevent any knowledge? It is enough to excuse particularity of description of the manner of...