May v. United States

Decision Date19 August 1912
Docket Number3,663.
Citation199 F. 42
PartiesMAY et al. v. UNITED STATES. [1]
CourtU.S. Court of Appeals — Eighth Circuit

[Copyrighted Material Omitted]

Henry W. Blodgett (Bates, Blodgett, Williams & Davis, on the brief), for plaintiffs in error.

Charles A. Houts, U.S. Atty.

Before SANBORN and HOOK, Circuit Judges, and WILLARD, District Judge.

WILLARD District Judge.

Plaintiffs in error, Fred D. May, Thomas B. May, William M. Johnson, and E. W. Bailey, were convicted under the second count of an indictment which charged a violation of section 4 of the Oleomargarine Act of August 2, 1886, c. 840, 24 Stat. 209 (U.S. Comp. St. 1901, p. 2229). This section punishes one who carries on the business of manufacturing oleomargarine without having paid the special tax therefor. They were also convicted under the third count, which charged a violation of section 17 of the same act. No objection to the sufficiency of the second count is here urged. It is claimed, however that the third count is insufficient. This point was raised in the court below by a demurrer.

The third count is as follows:

'That Fred D. May, Thomas B. May, William M. Johnson, and E. W. Bailey, whose Christian name is to the grand jurors aforesaid unknown, heretofore, to wit, on or about the 29th day of November, 1910, within the division and district aforesaid, and within the jurisdiction of the court aforesaid, at No. 3536 Morgan street, in the city of St. Louis, state of Missouri, they, the said Fred D. May, Thomas B. May, William M. Johnson, and E. W. Bailey, whose Christian name is to the grand jurors aforesaid unknown, being then and there persons engaged in carrying on the business of a manufacturer of colored oleomargarine at said No. 3536 Morgan street, in the city of St. Louis, state of Missouri, under the name of the Clayton Creamery, did then and there knowingly, willfully, fraudulently, and feloniously attempt to defraud the United States of the tax imposed by law upon colored oleomargarine of ten (10) cents per pound on each pound of colored oleomargarine so manufactured, to wit: Ten (10) cents per pound on one hundred and twenty (120) pounds of colored oleomargarine then and there produced by them, the said Fred D. May, Thomas B. May, William M. Johnson, and E. W. Bailey, whose Christian name is to the grand jurors aforesaid unknown.'

Section 17 is as follows:

'That whenever any person engaged in carrying on the business of manufacturing oleomargarine defrauds, or attempts to defraud, the United States of the tax on the oleomargarine produced by him, or any part thereof, he shall forfeit the factory and manufacturing apparatus used by him, and all oleomargarine and all raw material for the production of oleomargarine found in the factory and on the factory premises, and shall be fined not less than five hundred dollars nor more than five thousand dollars, and be imprisoned not less than six months nor more than three years.'

The essential elements of the offense defined in section 17 are: (1) That the defendant is engaged in carrying on the business of manufacturing oleomargarine. (2) That he has produced oleomargarine. (3) That he has attempted to defraud the United States. All of these are found in the third count. The claim of the defendants, however, is that before the offense can be committed the oleomargarine produced must have become subject to the tax. They call attention to section 8 of the act, which provides that 'upon oleomargarine which shall be manufactured and sold, or removed for consumption or use,' there shall be assessed a tax, and they say that the indictment should have alleged that the defendants had attempted either to sell it, or to remove it for consumption, or to remove it for use; and they insist that an allegation of this kind was an essential part of the indictment.

Whatever may be said of this claim when the charge is that the defendant has defrauded the United States, it cannot be sustained when the charge is that the defendant has attempted to defraud the United States. Conclusive evidence might be produced to the effect that a defendant had made plans to construct and operate an illegal factory for the manufacture of oleomargarine, to manufacture it, and to sell it without payment of the tax. It might also be further shown conclusively that, in pursuance of this illegal plan, he had erected a factory and had commenced to manufacture and had actually manufactured oleomargarine with the intent of selling it without paying the tax, but that before he had sold or removed, or attempted to sell or remove, any part of it, his operations were interfered with by the authorities. Can it be said in such a case that he has not attempted to defraud the United States? At least, when a defendant's operations have proceeded so far as to show conclusively that he has produced oleomargarine with the intent to defraud the government out of the tax thereon, there is an attempt to defraud such as is mentioned in section 17, although he has neither sold nor removed nor attempted to sell or remove any of the product.

It is further said with reference to this count that it does not advise the defendant of the manner in which he attempted to commit the fraud, so as to enable him to prepare his defense. It is to be noted that section 17 does not declare it an offense to commit the fraud in any particular way. If it did, then it would be necessary to allege the manner in which the act was done. But as the section stands, it is an offense if the government is defrauded by any means or method. As was said in United States v. Simmons, 96 U.S. 360, on page 364, 24 L.Ed. 819:

'The intent to defraud the United States is of the very essence of the offense; and its existence, in connection with the business of distilling being distinctly charged, must be established by satisfactory evidence. Such intent may, however, be manifested by so many acts upon the part of the accused, covering such a long period of time, as to render it difficult, if not wholly impracticable, to aver, with any degree of certainty, all the essential facts from which it may be fairly inferred.'

To have alleged in this indictment how the defendants attempted to defraud the United States would have required a statement of much of the evidence presented at the trial. The count, as it appears, advises the defendants of the time when the act was committed, namely, on November 29, 1910. It advises them where it was committed, namely, at 3536 Morgan street, in the city of St. Louis, Mo. It advises them of the name under which it is claimed they were doing business, namely the Clayton Creamery. It advises them of the amount of oleomargarine produced, namely, 120 pounds.

As to the sufficiency of this count the case is, we think, covered by the case of Armour Packing Company v. United States, 153 F. 1, on page 16, 82 C.C.A. 135, on page 150 (14 L.R.A. (N.S.) 400). This court there said:

'It is conceded that, where a crime is a statutory one, the indictment must set forth with clearness and certainty every essential element of which it is composed. It must portray the facts which the pleader claims constitute the alleged transgression so distinctly as to advise the accused of the charge which he has to meet and to give him a fair opportunity to prepare his defense, so particularly as to enable him to avail himself of a conviction or an acquittal in defense of another prosecution for the same offense, and so clearly that the court may be able to determine whether or not the facts there stated are sufficient to support a conviction. (Citing cases.) The indictment in this case pleads the names of the carriers that transported the property, the date and place of the delivery of the goods to the initial carrier and of the receipt of the concession by the shipper, a description of the specific articles shipped, the filed and published rate, the less rate at which the goods were transported, and the amount of the concession, the place of shipment, and the point of destination of the property, and the route over which it was transported. Here were averments of facts sufficient to clearly advise the defendant of the offense with which it was charged, to give it ample opportunity to prepare its defense, to enable it to avail itself of a conviction or an acquittal in the case of another prosecution for the same crime, and to qualify the court to determine whether the facts stated constituted an offense. The particular device by which the concession and transportation were obtained was not an essential ingredient of the offense charged, because the latter might well exist, whatever the device, and whether or not there was one, and hence the indictment portrayed every material element of the crime without an averment of this device. U.S. v. Tozer (D.C.) 37 F. 635, 637. The substance of the crime of receiving a rebate or concession under the Elkins act is the solicitation, acceptance, or receipt thereof, whereby property in interstate or foreign commerce is transported at less than the regular rate. The device whereby the receipt and transportation are obtained is not an essential element of the crime, and it is unnecessary to plead it in the indictment.'

It is to be observed that the law there under consideration provided that it should be unlawful for any person to receive any rebate or concession, whereby property should, 'by any device whatever,' be transported at a less rate than that named in the published tariffs, yet the indictment there under consideration did not allege what the device was by which the rebate had been secured. The judgment of this court in that case was affirmed by the Supreme Court, and the decision of that court is reported in 209 U.S. 56, on...

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