Moffatt v. United States

Citation232 F. 522
Decision Date06 March 1916
Docket Number4178.
PartiesMOFFATT v. UNITED STATES. [1]
CourtUnited States Courts of Appeals. United States Court of Appeals (8th Circuit)

[Copyrighted Material Omitted]

W. Knox Haynes, of Chicago, Ill., for plaintiff in error.

Charles A. Houts, Sp. Asst. U.S. Atty., of St. Louis, Mo. (Arthur L Oliver, U.S. Atty., of St. Louis, Mo., on the brief), for the United States.

Before HOOK, Circuit Judge, and YOUMANS and ELLIOTT, District Judges.

ELLIOTT District Judge.

The plaintiff in error, Benjamin F. Moffatt, hereinafter referred to as the defendant, was indicted, charged with violations of section 215 of the Penal Code. The indictment contained six counts, and upon trial the jury returned a verdict of not guilty as to all of the counts in the indictment, except count No. 3, and as to that a verdict of guilty was returned. So much of the indictment as is material here is as follows:

'The grand jurors of the United States, impaneled and sworn in the District Court of the United States for the Eastern Division of the Eastern Judicial District of Missouri at the September term thereof, in the year 1912, and inquiring for that division and district, upon their oaths present and charge that Benjamin F. Moffatt, late of the city of Chicago, county of Cook, state of Illinois, on the 2d day of December, 1910, did wrongfully and unlawfully devise a certain scheme and artifice for obtaining money and property from a class of persons herein in this count mentioned, residing within the United States, by means of false and fraudulent pretenses, representations, and promises, and thereupon converting such money and property to his own use, without repaying, or returning, or accounting for the same to such persons, and thereby defrauding said persons of the same, an essential and necessary part of which said scheme and artifice was the intentional use by him, the said Benjamin F. Moffatt, of the mails and post office establishment of the United States, that is to say, the scheme and artifice now here described, having on said 2d day of December, 1910, entered into a contract with the Buick Oil Company, a corporation organized and then existing under the laws of the state of California, with a capital stock of five million dollars ($5,000,000.00), divided into five million (5,000,000) shares, each of a par value of one dollar ($1.00), under the terms of which said contract said Benjamin F. Moffatt together with one Frederick Lorenz and one Ben Levon, undertook to purchase, and said Buick Oil Company undertook to sell, five hundred thousand (500,000) shares of the capital stock of said Buick Oil Company (less such number of shares of said stock as had theretofore been issued under contracts which said Moffatt and others associated with him had theretofore had with said Buick Oil Company), at a price of fifteen cents (15 cents) for each said share, said Benjamin F. Moffatt conceived on the day in this count aforesaid a device and plan for obtaining from E. S. Briggs, Charles W. Barth, Solomon S. Goldberg, John R. Gregg, L. W. Ham, Frank Houts, Wm. B. Martin, Edward C. Speckart, Wm. Trapp, Mrs. Fannie Tyrill, Mrs. Mildred Wagner, and Andrew Walz, and from others to the grand jurors unknown, and from the public generally, by the sale to such persons of said shares of said capital stock of said corporation, and of such shares of stock in said corporation as said Benjamin F. Moffatt should thereafter be able to acquire, numberous large sums of money upon divers false and fraudulent pretenses, representations, and promises by the said Benjamin F. Moffatt, made and to be made in print from time to time in newspapers, letters, circular letters, and pamphlets, sent and to be sent by mail to such persons, in which said newspapers, letters, circular letters, and pamphlets the said Benjamin F. Moffatt would and did represent (and said representations were reasonably calculated to cause said persons to believe) that the purchase of said stock by said persons was an advisable thing to do and would be a safe and profitable investment of their funds; that the stock which said Benjamin F. Moffatt would and did offer for sale was treasury stock of said Buick Oil Company, belonging to said Buick Oil Company, and that the proceeds of such sale thereof as said Benjamin F. Moffatt had and might thereafter make would and did go into the treasury of said Buick Oil Company; that in selling said stock said Benjamin F. Moffatt was acting for and on behalf of said Buick Oil Company; that said Benjamin F. Moffatt was the general manager of the Buick Oil Company, and that the offices maintained by him in the city of Chicago, state of Illinois, were the offices of said Buick Oil Company; that the proceeds of the sale of such of said stocks as should be and had been sold by said Benjamin F. Moffatt, less the bare cost of selling said stock, had been and was being used in the development of the properties of the Buick Oil Company; that quarterly dividends had been and would be paid upon said stock of said Buick Oil Company, and that constantly increasing dividends upon said stock would be paid; that divers advertisements, circulars, and letters which said Benjamin F. Moffatt would send and had sent to said persons advertising said stock for sale was authorized and signed by said Buick Oil Company, and by D. D. Buick, president of said Buick Oil Company, and by D. D. Buick, individually, and that the said Benjamin F. Moffatt was the only person through whom said stock could safely be purchased; whereas in truth and in fact, as he, the said Benjamin F. Moffatt, well knew at the time and place of so devising said scheme and artifice for obtaining money and property in this count of this indictment mentioned, in the manner and by the means in this count aforesaid, and of converting such money to his own use, and of defrauding the persons in this count referred to out of the same, and of committing the several offenses of unlawfully using the mails in the counts of this indictment (from 1 to 6, both inclusive), and as the grand jurors aforesaid, upon their oaths aforesaid, charge the facts to be, such purchases of said capital stock by said persons was an inadvisable thing to do, and would be an unsafe, unprofitable, and losing investment of their funds; that the stock which said Benjamin F. Moffatt would thereupon sell to such persons was not treasury stock of said Buick Oil Company, and did not belong to said Buick Oil Company, and the proceeds of the sale thereof would not and did not go into the treasury of said Buick Oil Company; that in the sale of said stock said Benjamin F. Moffatt was not and would not act for and on behalf of said Buick Oil Company, but would act for and on his own account; that said Benjamin F. Moffatt was not and would not be the general manager of said Buick Oil Company, and that he had no official connection with said Buick Oil Company, and that the offices maintained by said Benjamin F. Moffatt in Chicago would not be and were not offices of said Buick Oil Company; that the proceeds of the sale of the stock which said Benjamin F. Moffatt would and did sell, less the bare cost of selling said stock, did not and would not go into the development of the properties of said Buick Oil Company, but, on the contrary, said proceeds would be converted to the use of said Benjamin F. Moffatt; that quarterly and constantly increasing dividends had not been and would not be paid upon the outstanding stock of said Buick Oil Company; that the said advertisements, circulars, and letters which the said Benjamin F. Moffatt would and did send out in advertising said stock for sale, purporting to be authorized and signed by said Buick Oil Company, and by D. D. Buick, president of said Oil Company, and by D. D. Buick, individually, would not be and had not been authorized or signed by the Buick Oil Company, by D. D. Buick, president of the Buick Oil Company, or by D. D. Buick, individually, but that, on the contrary, said advertisements, circulars and letters, purporting to be so signed and authorized, would be and were sent out by said Benjamin F. Moffatt without the knowledge or consent and over the protest of said Buick Oil Company, D. D. Buick, president of said Buick Oil Company, and D. D. Buick, individually, and that said Benjamin F. Moffatt was not and would not be the only person from whom said stock could safely be purchased.' Omitting the overt acts set forth in the first count of the indictment, the third count, upon which the defendant was convicted, is as follows:
'Third Count. And the grand jurors aforesaid, upon their oaths aforesaid, do further present and charge that said Benjamin F. Moffatt, on or about the 16th day of December, 1910, so having devised the scheme and artifice for obtaining money and property from the class of persons referred to and described in the first count of this indictment by means of false and fraudulent pretenses, representations, and promises in said first count mentioned and described, and of defrauding said persons of their money and property by the means and in the manner in said first count aforesaid (the allegations of said first count descriptive of said scheme and artifice including the allegations of intent and knowledge on the part of said Benjamin F. Moffatt are by reference hereby incorporated in this count as fully as if here set forth and repeated), in and for executing said scheme and artifice and attempting so to do, and for the purpose and with the intention on his part of executing said scheme and artifice, and attempting so to do unlawfully, feloniously, and knowingly did cause to be delivered by mail by the post office establishment of the United States, according to the direction thereon, at the city of St. Louis,
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