Myers v. United States

• Decision Date: 12 May 1915
• Docket Number: 239.
• Citation: 223 F. 919
• Parties: MYERS et al. v. UNITED STATES.
• Court: U.S. Court of Appeals — Second Circuit

223 F. 919

MYERS et al. v. UNITED STATES.

No. 239.

United States Court of Appeals, Second Circuit.

May 12, 1915

[Copyrighted Material Omitted]

Defendants were tried under two indictments. The first contained 8 counts. Of these the first charged that on February 1, 1905 and continuously and at all times until December 29, 1909 defendants engaged in a conspiracy to defraud divers persons by inducing them to deposit money for the purpose of purchasing treasury stock of a certain specified mining corporation upon certain representations, among others, that the money so deposited would, except for a small commission, be used in conducting the business of the corporations; that defendants in truth intended not thus to use the money, but to convert a large part of it to their own use, delivering to the persons thus depositing, not treasury stock, as promised, but defendants' own personal stock; that it was intended by defendants that the scheme should be effected by use of the mails. The second, fifth, and eighth counts, with changes of dates and names of corporations, charged similar conspiracies. All these counts were under section 5440, U.S. Rev. Statutes. The fourth count was dismissed on the government's own motion prior to the beginning of the trial. The third, sixth, and seventh counts charged each the devising of a scheme to defraud-- similar to that above set forth-- under section 5480, U.S. Rev. Statute.

The second indictment contained 11 counts. Except the first and fifth, each of these counts charged that in 1910 defendants, having theretofore devised a scheme to defraud (setting it forth), used the mails in furtherance of the scheme, under section 215, Criminal Code. The first and fifth counts charge conspiracy to violate that section-- under section 37, Criminal Code. All these schemes and conspiracies were of the same character, dealing with various named mining companies.

George Gordon Battle, of New York City, for plaintiffs in error.

Henry N. Arnold and Raymond G. Brown, Sp. Asst. Attys. Gen., for the United States.

Before LACOMBE, COXE, and WARD, Circuit Judges.

LACOMBE Circuit Judge.

The record is inordinately long; there are four volumes of testimony; the trial lasted seven weeks; there are hundreds of exhibits. It is a most unfortunate practice to multiply counts, to marshal large numbers of defrauded persons, and to give testimony as to scores of 'similar offenses to show intent,' when, as will be seen from subsequent reference to the testimony, guilt in act and in intent is readily provable by documents about whose issue or signature by defendants there can be no doubt. In this connection we may state that we find no error in showing the doings of defendants prior to January 2, 1910, when the Criminal Code went into effect. Although they might have devised a scheme to defraud prior to that date, continuance of such scheme after the Code went into effect would be a full equivalent of devising such scheme on that day.

In discussing the case, the order in which the points relied upon by plaintiffs in error are presented in their brief will be followed, so far as practicable. It is contended that application for a reasonable continuance for the purpose of preparation was denied defendants. Unless there were some plain abuse of discretion, there is nothing which calls for review. The cause had been tried about a year before (resulting in a disagreement of the jury) and had taken nine weeks to try. Defendants asserted that they were not able to retain counsel who represented them on the first trial, or indeed any other, so counsel were assigned by the court on January 9, 1914; the trial being set for January 20th, a few more days being available for impaneling a jury and opening the government's case. Defendant's delay in notifying the court that counsel would have to be assigned was chargeable to themselves. So, too, was the circumstance that one of the defendants chose not to come on from San Francisco until January 17th. Moreover, the nine weeks' trial, stenographer's minutes of which were available, showed up fully what defendants must expect to meet, and made the task of counsel easier than it would have been, had they not known what the details of the government's proof were to be.

The second point discusses the introduction in evidence of a clipping from a newspaper, the Daily Mining Record of Denver, which it claims was highly prejudicial. Some letters between defendant Wisner and the editor or publisher of the paper had been put in evidence; all of these are apparently not printed n the record; at least all are not indexed. They seem to have involved some objections or explanations by Wisner in respect to statements which had appeared in the paper. The publisher, being on the stand, identified an issue of the paper containing the article. Objection being made, the government stated that it was offered, not in evidence of any statement of fact therein contained, but as throwing light on a letter of Wisner to investors, stating that Reinhart, the publisher, was trying to blackmail him, in order to get advertisements.

We are inclined to think the article was admissible in explanation of the letter; but, however that may be, we are satisfied that what happened was not prejudicial to defendants. The article was a long one, about 17 pages, but the court allowed only some 3 pages to be read to the jury. Nearly all of this admitted portion contained merely a summary of the contents of defendant's circulars and advertisements; all of which were abundantly proved otherwise. Through some oversight apparently, the admitted portion contained a sentence in which, criticising the Wisner method of promotion and sale of stock, the writer of the article said it 'savors of the worst sort of quackery. The Record will leave to its readers to indulge in more severe language, if they so desire. In the light of A. L. Wisner & Co.'s avowed reasons for paying dividends simultaneously with the sale of treasury stock, this practice, which under any circumstances may be set down as wanting in conservatism, is made to stand out in all its shadowed outlines, gaunt and unmistakable. ' We find it difficult to suggest a satisfactory reason for the admission of these quoted sentences, but in view of the fact that the characterization of defendant's acts warranted much stronger language than that used in the newspaper article, we cannot believe that the defendants were injured by its introduction.

It is next assigned as error that defendant's motion for withdrawal of a juror was denied. The motion was made because of a publication in two or three newspapers, while the trial was in progress. The circumstances were these: About a week after the trial began, defendants being both enlarged on bail, counsel for the...