U.S. v. Barket, 75-1320

Decision Date23 March 1976
Docket NumberNo. 75-1320,75-1320
Citation530 F.2d 189
PartiesUNITED STATES of America, Appellant, v. Alexander J. BARKET, Appellee.
CourtU.S. Court of Appeals — Eighth Circuit

Anthony P. Nugent, Jr., Asst. U.S. Atty., Kansas City, Mo., for appellant.

Veryl L. Riddle, St. Louis, Mo., for appellee.

Before GIBSON, Chief Judge, HENLEY, Circuit Judge, and VAN PELT, Senior District Judge. *

GIBSON, Chief Judge.

This is an appeal by the United States pursuant to 18 U.S.C. Sec. 3731 (1970) 1 from the District Court's 2 dismissal of a two count indictment charging the appellee, Alexander J. Barket, with making an unlawful political contribution and misapplying bank funds in violation of 18 U.S.C. Secs. 2, 610 and 656 (1970) on the ground that Barket's Fifth Amendment right to due process was violated by prejudicial pre-indictment delay. Alternatively, the District Court found that prosecutorial misconduct violating legal and ethical codes and regulations also required dismissal as an exercise of the court's supervisory power to insure the proper administration of criminal justice. We affirm on the due process ground of prejudicial pre-indictment delay.

* * * * * *

The indictment in question 3 filed against Barket on June 12, 1974, arose out of a transaction involving the Civic Plaza National Bank of Kansas City, Missouri, of which Barket was president, chairman and primary beneficial owner. Both counts were based upon a single transaction involving an unsecured loan of $30,000 made on July 29, 1970, to the Regular Democrats, a now-defunct, loosely organized ad hoc political group composed of various factions of the Democratic Party in Jackson County, Missouri. The loan was to be used for campaign advertising expenses in the primary election of August, 1970, and was to be repaid with proceeds from a victory dinner honoring the late William Morris, Lieutenant Governor of Missouri, and from other contributions.

The June, 1974, indictment charged Barket with consenting "to the contribution and expenditure" of national bank funds to a political organization to pay election expenses in violation of 18 U.S.C. Sec. 610 (count I) 4 and with misapplying the same funds by means of the same "contribution * * * guised as a bank loan" in violation of 18 U.S.C. Secs. 2 and 656 (count II). 5 The loan was approved by the bank's discount committee and the $30,000 debt evidenced by a note signed by Lawrence Gepford, a Kansas City attorney and former Prosecuting Attorney for Jackson County, Missouri, who deposited the proceeds in an account maintained by the group. The loan was once extended, but was ultimately repaid in full with interest by Barket and others just prior to the extended maturity date on January 21, 1971, upon order of the Comptroller of the Currency.

Barket has contended from the start of this prosecution that the subject transaction was not a "contribution" but a bona fide bank loan made in the ordinary course of business so as to be exempt under Sec. 610, and that the Regular Democrats was not a political committee of the type intended to be covered by the Act. Before putting the Government to its proof on these issues, Barket, on July 19, 1974, moved for dismissal of the indictment inter alia on the grounds that his defense had been prejudiced by approxinmately 47 months delay in the filing of the charge and by prosecutorial misconduct. In an extensive five-day pretrial hearing in February and March, 1975, the District Court took evidence relating to Barket's allegations of delay and misconduct.

During the course of the hearing it came to light that in a routine bank examination on January 4, 1971, a national bank examiner discovered and subsequently reported the $30,000 loan to the Regional Administrator of National Banks. On March 15, 1971, the Comptroller of the Currency referred the loan by letter to the Criminal Division of the Department of Justice in Washington for possible prosecution. One year after the referral the Justice Department declined prosecution of Barket or Civic Plaza and closed the case.

The central office of the Department of Justice in Washington, however, did not report the referral, declination or closing of Barket's case to the United States Attorney for the Western District of Missouri, and apparently retained no record summarizing the information gathered in its investigation of the $30,000 loan or revealing the reasons for its declination of prosecution. Consequently, when the local United States Attorney discovered the loan in an unrelated investigation in late 1973, and thereafter requested permission to indict Barket, the Justice Department in Washington granted permission but did not consider the request as a question of whether new evidence or other factors justified reopening the two year old closed case. This failure to exercise the required centralized prosecutorial discretion was considered by the District Court as a factor in assessing prejudice to Barket's defense.

At the close of the hearing, the District Court concluded that the knowledge possessed in early 1971 by the national bank examiner and the Department of Justice in Washington should in fairness be imputed as well to the local United States Attorney in assessing Barket's claim that he was denied due process, and that Barket had shown sufficient delay-caused prejudice to his defense. By early 1975, six material witnesses had died and others had faded memory of events crucial to Barket's defense. Consequently, the court felt compelled to dismiss the indictment, relying upon United States v. Marion, 404 U.S. 307, 92 S.Ct. 455, 30 L.Ed.2d 468 (1971).

The Government appeals, contending that Barket failed to meet his burden of proving actual prejudice to his defense and, in any event, failed to demonstrate that the delay was intentionally sought by the Government to gain tactical advantage--as it claims he must under United States v. Marion, supra. In Marion, the Supreme Court recognized that statutes of limitation do not fully define suspects' rights to be speedily accused and that governmental pre-prosecution delay may violate a defendant's right to due process under the Fifth Amendment. The Court announced the new standard for assessing this claim in Marion:

Thus, the Government concedes that the Due Process Clause of the Fifth Amendment would require dismissal of the indictment if it were shown at trial that the pre-indictment delay in this case caused substantial prejudice to appellees' rights to a fair trial and that the delay was an intentional device to gain tactical advantage over the accused. * * * However, we need not, and could not now, determine when and in what circumstances actual prejudice resulting from pre-accusation delays requires the dismissal of the prosecution.

United States v. Marion, supra at 324, 92 S.Ct. at 465. (Citations omitted). The Marion defendants failed to allege or prove that their defense was actually prejudiced by the delay or that the Government intentionally engaged in delay to gain tactical advantage over them. Consequently, the Court, while recognizing that "[e]vents of the trial may demonstrate actual prejudice," held that their due process claims were speculative and premature. 404 U.S. at 326, 92 S.Ct. at 466.

It is settled, therefore, that the fact that the five-year statute of limitations 6 applicable to Barket's alleged violations of Secs. 610 and 656 was not due to expire until thirteen months after the indictment was filed does not foreclose his assertion of prejudice form pre-indictment delay. Under Marion, Barket's Fifth Amendment claim involves "a process of balancing the reasonableness of the delay against any resultant prejudice to the defendant." United States v. Jackson, 504 F.2d 337, 339 (8th Cir.1974), cert. denied, 420 U.S. 964, 95 S.Ct. 1356, 43 L.Ed.2d 442 (1975); United States v. Norton, 504 F.2d 342, 344 (8th Cir.19740, cert. denied, 419 U.S. 1113, 95 S.Ct. 790, 42 L.Ed.2d 811 (1975). The test for determining prejudicial impact is whether the delay "has impaired the defendant's ability to defend himself," United States v. Golden, 436 F.2d 941, 943 (8th Cir.), cert. denied, 404 U.S. 910, 92 S.Ct. 236, 30 L.Ed.2d 183 (1971), and the trial court's finding on the prejudice issue must stand unless clearly erroneous. United States v. Jackson, supra at 341.

After a careful review of the record, briefs and arguments of the parties, we believe the instant case, unlike United States v. Jackson, supra, and cases cited therein, presents a unique showing of prejudice sufficient in the circumstances to require dismissal of the indictment. The passage of time, for which Barket was not responsible, was considerably longer (47 months) than that in any other of our decisions failing to find prejudice; and the District Court's finding of prejudice is not subject to reversal by us unless it is clearly erroneous. Six witnesses who, Barket claims, would have materially aided his defense died before the case could have come to trial. They were: Leon Jordan, the leader of Freedom, Inc., a Jackson County precinct organization that allegedly received funds from the Regular Democrats; Bill Royster, leader of the Good Government Association, another alleged recipient; Alex Presta, leader of the Metropolitan Democratic Club; William Morris, the late Lieutenant Governor of Missouri in whose honor the Regular Democrats sponsored their fund raising dinner; H. Moody Murray, a local candidate who allegedly received some of the borrowed funds; and finally, Daniel McKeever, a director of Civic Plaza National Bank. Moreover, as the District Court found, many other witnesses who are still alive and able to testify for Barket had, in the District Court's words, "extreme and understandable difficulty remembering" relevant facts. The loss of these witnesses undoubtedly impaired Barket's ability...

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