Samish v. United States

• Decision Date: 08 July 1955
• Docket Number: No. 14261.,14261.
• Citation: 223 F.2d 358
• Parties: Arthur H. SAMISH, Appellant, v. UNITED STATES of America, Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

223 F.2d 358 (1955)

Arthur H. SAMISH, Appellant, v. UNITED STATES of America, Appellee.

No. 14261.

United States Court of Appeals Ninth Circuit.

May 20, 1955.

Rehearing Denied July 8, 1955.

COPYRIGHT MATERIAL OMITTED

Harold C. Faulkner, Wilbur F. Mathewson, Allan L. Fink, Melvin, Faulkner, Sheehan & Wiseman, San Francisco, Cal., for appellant.

Lloyd H. Burke, U. S. Atty., Robert H. Schnacke, Asst. U. S. Atty., San Francisco, Cal., for appellee.

Before DENMAN, Chief Judge, CHAMBERS, Circuit Judge, and CLARK, District Judge.

CHAMBERS, Circuit Judge.

Arthur H. Samish appeals from his conviction on eight counts of an indictment charging him with wilfully attempting to defeat and evade payment of income taxes.

The alleged income which he did not report on his income tax returns for the years 1946, 1947, 1948, 1949, 1950 and 1951¹ concerns a series of checks drawn by the Biow Company, a New York advertising agency. The checks varied in amounts from $950 to $5,000.² At first the checks were payable to known Samish business associates, relatives or simply friends. Later the checks as issued were written to fictitious payees. With two or three exceptions, Samish admits receipt of all the checks. Only one does he deny receiving.

In 1943 the defendant played some part in getting for the Biow Company a substantial portion of the advertising business of Schenley Distillers, a very fine account for an advertising agency. Samish was a friend of Louis Rosenstiel, chairman of the board of Schenley. The leading actors for Biow in the events with which this court is concerned were Milton H. Biow, president, and Morris Zinneman, treasurer. Biow's admit that in making the remittances to Samish, for whatever reason the checks were sent, they falsified their books in that they charged the amounts thereof to various radio, television, magazine and newspaper accounts. But orally they stoutly maintained the checks were given Samish as compensation for securing Biow the Schenley account. There clearly appears to have been sufficient testimony to withstand the motion for acquittal made by defendant at the end of plaintiff's case.

Defendant, as well he may, admits that the evidence is sufficient to sustain the jury's verdict. On the issue of unreported income, it can be said that it is overwhelming.

From a practical standpoint the defense of Samish was to "try" Biow. And if Biow's low standard of morality as shown in the record is any excuse for Samish, then Samish ought to go free.

Many of the appellant's assignments of error concern the Biow testimony in one way or another. But first it seems proper to deal with Samish's story about the checks. Eventually Samish, in defense, took the stand.

Extensively, portions of the Samish testimony are set forth seriatim, either verbatim or summarized narratively:

1. In a preliminary conversation with Al Lyon, president of Philip Morris Co., in 1944, Lyon said to Samish regarding Biow's obtaining the Schenley account, "You are entitled to a finder's fee or some monies." Samish replied, "Al, I am not interested in receiving anything for myself; I represent Schenley interests; I can't — I can't take anything." Said Lyon, "Well, don't be a fool. You are entitled to something. You have got a lot of political contributions to make." Said Samish, "I have some very fine personal friends, too."

2. Soon after, Samish saw President Biow, and Samish says Biow said, "Art, we are very appreciative of getting this Schenley account." Samish continues that Biow told him that Mr. Lyon had talked to him about some political contributions and gifts and said that if he (Samish) would go to Mr. Zinneman he would have some checks for him.

3. Shortly thereafter, Samish was dealing with Zinneman, Biow's treasurer, and Zinneman reported, according to Samish, that Biow had talked to him, and Zinneman asked Samish for the names for some checks. Samish says that he suggested the use of his name. Zinneman protested that he didn't want Samish's name and that he didn't even want Samish to endorse the checks, for reasons which Zinneman said were his business. Thereupon, Samish gave him some names for checks.

4. One of the first checks received by Samish was in the amount of $2500 payable to his secretary, Dorothy L. Ready. Of this he says, "I made a present to her as a gift to her from Mr. Biow."

5. Another check was handed by Samish to one Miss E. Mack. Samish says it was given to Miss Mack "as a gift from Mr. Biow."

6. Another check, says Samish, was handed to Mr. Frank Howard as a gift from the Biow Company.

7. Another check, in 1948, says Mr. Samish, was given to Miss Ready "as a gift from Mr. Biow."

8. In 1949, says Samish, he "handed a $2500 check to Miss Ready as a gift from the Biow Company."

9. Another check, in 1949, went to F. Howard, Samish's son-in-law, "as a gift from the Biow Company."

10. In 1950, a check went to A. Robbins, a friend of Samish, "as a gift from the Biow Company." Following the testimony concerning some of these presents, including the Robbins check, Samish said, "Well, the reason being * * * the three or four — I think it is four — that I gave these gifts to were close friends and people who I liked and people who I wanted to do something for, like I have done for many other people."

11. The checks used for political purposes and payable to fictitious payees, Samish related, he was able to cash at various places without himself making any endorsement thereon. Generally, he said, the proceeds of the checks went into an envelope or political "kitty" which he usually kept in his safe, although he did make some distribution of the proceeds of checks which he cashed for political purposes in New York without taking the checks to the envelope in his safe in San Francisco where he ordinarily kept the "kitty." Generally Samish could not identify the political recipients of the proceeds of the checks which he reported were used for political purposes.

12. At another point in his testimony concerning the transactions with President Biow, Samish testified as follows:

"I recall some kind of a conversation wherein he stated that he wanted to compensate me or something of that sort and I very definitely told him that under no circumstances can I accept any compensation. I had no objection if he wanted to put me on his payroll or anything, but as Mr. Lyon stated, and I stated to Mr. Lyon at the time, that I explained to Mr. Biow that — * * * I told Mr. Biow at the time during that conversation that under no circumstances could I receive any compensation from him for the help of securing any account, or — and he further stated to me during some conversation, during the talk with Mr. Lyon, and I reiterated, that while I couldn't receive any compensation, if he wanted to make some political contributions or some gifts to some friends of mine who I would indicate, that that was entirely up to him."

13. It further appears from the Samish testimony that Treasurer Zinneman did not know any of the live payees, and that Zinneman showed no interest in the identity of the payees. Further, in the early stages of the series of check transactions, Samish furnished all of the names of the payees.

14. Samish was asked if he remembered any political campaigns in which the Biow Company had any interest whatsoever. He replied, "What would they have an interest in campaigns for?" Then he was asked, "These were political contributions that were to be made for the Biow Company, were they not?" His response was, "Not to my knowledge." Then, to the question, "They were political contributions to be made by you, is that correct?" he responded, "They were political contributions. I don't say the year 1944, but whenever they were made, given to me to use at my discretion." Then, following the question, "In any way that you saw fit, is that right?" he answered, "Well, I would think so, having in mind they had a full knowledge that I was concerned about political contributions."

15. Again, Samish was asked, "Do you know of any campaign in California in 1944 in which the Biow Company had an interest?" To this he replied, "I would say no."

16. Again concerning the earlier checks, Samish said, "Well, I believe that Zinneman would call me and ask me for some names and I would give them to him." Samish, however, contends that all amounts were fixed by the Biow Company.

17. Later on, Samish testified that many names he supplied Biow were the names of persons that "I had some knowledge of, that I was sure wouldn't have any objection to their name being used." At another time Samish says, "The Biow money, the Biow political contributions, made it possible for me to be more generous at times with political contributions than I could ordinarily be."

18. To the question, "Did you feel there was anything wrong about the fact that you were taking money from the Biow Company," Samish replied, "No, sir."

19. Again, the Biow money "was just an accumulation of money that was there in Samish's safe to be used for political purposes — political campaigns."

This court is of the opinion that Samish's own testimony concerning all of the checks except four shows almost conclusively that the money (the four checks excepted) received from the controversial checks was taxable income. One begins with the business background. Samish, without question, had done Biow a huge business favor. Biow offers to pay Samish. Can Samish avoid tax liability by saying, "You can't pay me. But you can make some gifts to friends of mine not yours. Give me the checks. Let me present them. And you can also give me some political money"? Someone owned the checks at the moment they were in Samish's hands. That man was Samish. Someone owned the proceeds of the political checks while he held the proceeds. That owner was Samish until he disbursed them. See Old Colony Trust Co. v. C. I. R., 279 U.S. 716, 49 S.Ct. 499, 73 L.Ed. 918. The facts might admit of...