MacDonald v. United States

• Decision Date: 20 April 1920
• Docket Number: 1436.
• Citation: 264 F. 733
• Parties: MACDONALD v. UNITED STATES.
• Court: U.S. Court of Appeals — First Circuit

264 F. 733

MACDONALD v. UNITED STATES.

No. 1436.

United States Court of Appeals, First Circuit.

April 20, 1920

Anderson Circuit Judge, dissenting.

In Error to the District Court of the United States for the District of Massachusetts; James M. Morton, Judge.

Laurie S. Macdonald was convicted of conspiracy to defraud the United States, and he brings error. Reversed and remanded.

1. Criminal law 370-- Bribery of government inspector under prior contract not admissible on trial for conspiracy to defraud.

On a trial for conspiracy to defraud the United States by the use of counterfeits of the stamping devices used by government inspectors in a factory manufacturing shoes for the government, where defendant denied all knowledge that the counterfeit stamps had been procured or used, evidence that he placed a government inspector at the factory under a previous contract on the factory pay roll under an assumed name was not admissible, as it did not tend to show his knowledge that the counterfeit stamps were procured and used and the question was not whether he had guilty knowledge, but whether he had any knowledge at all.

2. Criminal law 369(1)-- Other offenses not admissible to show tendency to crime.

On a trial for conspiracy to defraud the United States, evidence of a corrupt understanding with a government inspector in connection with a previous contract with the government was not admissible to show that defendant had an evil disposition, and that his character was such that he would be likely to enter into a conspiracy such as that charged.

3. Criminal law 370-- Other offenses not admissible to show guilty knowledge, unless in issue.

Evidence of other offense is not admissible as tending to show defendant's guilty knowledge, unless guilty knowledge or intent is in issue.

4. Criminal law 783(1)-- Instruction as to consideration of evidence of other offenses erroneous.

On a trial for conspiracy to defraud the United States by using counterfeits of the stamping devices used by government inspectors in connection with the manufacture of shoes for the government, where defendant, the general manager, denied knowledge of their use, as neither guilty knowledge nor intent were in issue, an instruction that the jury might consider a corrupt transaction with a government inspector under a previous contract as throwing light upon whether defendant was innocent or guilty in his knowledge of the transaction involved in the trial, was in effect an instruction that they might consider it in determining whether he was innocent or guilty of being concerned in the conspiracy charged.

5. Criminal law 899-- Exception to evidence not waived by introducing explanatory evidence.

On a trial for conspiracy to defraud the United States in connection with the manufacture of shoes for the government defendant's exception to evidence concerning his bribery of a government inspector under a previous contract was not waived by introducing evidence explaining the transaction with such inspector.

6. Criminal law 1172(2)-- Error in instruction as to consideration of evidence not cured by explanatory evidence.

Where defendant, charged with conspiracy to defraud the United States in connection with the manufacture of shoes for the government, excepted, not only to evidence of the bribery of a government inspector under a previous contract, but also to the court's instruction as to the use which the jury might make of such evidence, the instruction, if erroneous could not be cured, because defendant introduced testimony in explanation of the evidence as to the transaction with the inspector.

Guy A. Ham, of Boston, Mass. (Ralph H. Willard and William H. Taylor, both of Boston, Mass., on the brief), for plaintiff in error.

Lewis Goldberg, of Boston, Mass. (Thomas J. Boynton and Daniel A. Shea, both of Boston, Mass., on the brief), for the United States.

Before BINGHAM, JOHNSON, and ANDERSON, Circuit Judges.

JOHNSON Circuit Judge.

The plaintiff in error was jointly indicted with John J. Harrington and Oscar N. Johnson for conspiring to defraud the United States by the use of counterfeit stamping devices in the factory of Thompson Bros., a corporation engaged in the manufacture of shoes at Brockton in the district of Massachusetts. Macdonald was the general manager and director of the company, Harrington was the foreman of its sole leather room, and Johnson his assistant. The company had entered into a contract to manufacture army shoes for the United States, and government inspectors had been sent to its factory to examine the leather and other materials to be used in their manufacture. These inspectors were provided with stamping devices with which they stamped the leather that they deemed suitable for use.

The defendants were charged in the indictment with having conspired to defraud the United States by causing duplicates of the stamping devices in use by these inspectors to be made and used in stamping pieces of leather which had not been examined and inspected, or which had been rejected by the inspectors, so that these should be used in the manufacture of shoes under the contract, and that, in furtherance of this unlawful conspiracy, they had procured duplicate stamps of three government inspectors and caused them to be used to stamp leather which went into the manufacture of shoes under this contract, and which had been rejected or never had been inspected by the government inspectors.

Harrington pleaded guilty and was a government witness. The jury by its verdict acquitted Johnson, but found Macdonald guilty, and he has brought this writ of error, assigning as error the ruling of the court in the admission and exclusion of testimony and the giving and refusal to give instructions.

It was not in dispute that counterfeit stamps were used in the factory of Thompson Bros. upon outer soles and inner soles used in the manufacture of shoes under the government contract. The use of such stamps was discovered by government inspectors by reason of the impressions made by them being somewhat larger than those made by the true ones.

Harrington testified that Macdonald, finding that there was a large accumulation of inner soles and outer soles that had been rejected by the inspectors, directed him to have Johnson procure duplicates of their stamps; that Johnson did so, and had the bills made to himself as purchaser, but that they were paid by the company; and that these duplicate stamps were used to stamp inner soles and outer soles which, when so stamped, were used in the manufacture of shoes under the government contract.

Early in April, 1918, one of the government inspectors discovered that a duplicate stamp had been used, and he informed Macdonald. Officers of the Quartermaster's Depot at Boston sent for Macdonald, and he was there told about the discovery of the use of the counterfeit stamps, and stated that he knew nothing about it. He was told, however, by the officers that he must produce the parties who were guilty of the use of these stamps within 48 hours or the government contract with Thompson Bros. would be canceled.

Harrington testified that Macdonald told him about the discovery of the use of the counterfeit stamps and what had occurred in Boston, and stated that, if the government wanted to, they could ruin Thompson Bros. by canceling the contract with them, which would leave the company with $600,000 or $700,000 worth of material on its hands, and that Macdonald asked him if he would go into the Quartermaster's Depot and tell the officers there that he was the guilty person, and that he was the only one who had anything to do with the entire matter; that the witness at first refused, and said to Macdonald, 'Let's all go in and tell what was done;' and Macdonald said, 'No, we can't do that; we can't go to work and put the Thompson Bros. firm in that position;' and Macdonald said to him, 'You do it; I can fix it up; Edwards has had this matter transferred from Washington to Boston, and I can fix it up there;' that after some further urging by Macdonald he agreed to do as Macdonald wished, upon the latter's assurance that he would take care of him, and see that no harm came to him; that, in accordance with this agreement, he went in to the Quartermaster's Depot and told the officers in charge there that he was the guilty person.

There was testimony that these officers required that Harrington should leave the employ of Thompson Bros., and that he should not work in any factory which had a contract with the government. After leaving the factory of Thompson Bros., Harrington received from the company $655, of which $55 was paid as salary for the week prior to his leaving, and $600 was paid by Mr. Atwood, an employe of Thompson Bros., by direction of Macdonald, to Mrs. Harrington in three payments of $200 each.

On April 23, 1918, Harrington was arrested upon an indictment obtained against him, and testimony was offered by the government showing various conversations between Macdonald and Harrington, in which Macdonald urged him 'to stick' to his story that he had told the officers of the government, and that Thompson Bros. would protect him.

Mrs. Harrington testified to conversations between Macdonald and her husband which tended to show that Macdonald was implicated in the fraud that had been practiced, and was very much concerned lest Harrington should divulge his connection with it, and that in one conversation Macdonald said, 'I suppose they will get me into this before they get through; but my back is to the wall.'

Johnson was called by the government as a witness and testified that some time in December, 1917, he left an order for a stamp with the Donnelly Machine Company, having on it the name ...