U.S. v. Clark

• Decision Date: 17 April 1981
• Docket Number: No. 80-1978,80-1978
• Citation: 646 F.2d 1259
• Parties: UNITED STATES of America, Appellee, v. Bill R. CLARK, Appellant.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 1259

646 F.2d 1259

UNITED STATES of America, Appellee, v. Bill R. CLARK, Appellant.

No. 80-1978.

United States Court of Appeals,

Eighth Circuit.

Submitted Feb. 12, 1981.

Decided April 17, 1981.

Berl S. Smith, and William B. Howard, Jonesboro, Ark., for appellant.

George W. Proctor, U. S. Atty., Kenneth F. Stoll, Asst. U. S. Atty., Little Rock, Ark., for appellee.

Before ROSS, HENLEY and McMILLIAN, Circuit Judges.

McMILLIAN, Circuit Judge.

Bill R. Clark appeals from a final judgment entered in the District Court ¹ for the Eastern District of Arkansas upon a jury verdict finding him guilty of one count of violating Title IX of the Organized Crime Control Act of 1970, popularly known as the "Racketeer Influenced and Corrupt Organizations" Act or RICO, 18 U.S.C. § 1962(c), and seven counts of violating the Travel Act, 18 U.S.C. §§ 2, 1952. The district court sentenced appellant to three years imprisonment and a $25,000 fine on count I (the RICO violation) and to three years imprisonment, to be served concurrently with the sentence imposed on count I, on counts II-VIII (the Travel Act violations).

For reversal appellant argues that the district court erred in (1) refusing to dismiss the RICO count for failure to charge an offense and (2) refusing to grant a judgment of acquittal on the Travel Act counts for insufficiency of the evidence. For the reasons discussed below, we affirm the judgment of the district court.

Appellant served as the county judge of Craighead County, Arkansas, from January 1, 1967, to December 31, 1976. In Arkansas county judges are administrative or executive officials and are responsible for approving and authorizing the payment of bills and accounts on behalf of the county. The type of unlawful activity alleged by the government in the present case is unfortunately familiar to the court. See United States v. Anderson, 626 F.2d 1358 (8th Cir. 1980), cert. denied, -- U.S. --, 101 S.Ct. 1351, 67 L.Ed.2d -- (1981). In a superseding indictment the government charged appellant with conducting the affairs of the office of county judge of Craighead County through a pattern of racketeering activity, that is, by taking bribes from two sales representatives, Paul Baldwin of the "Lisco" Co. and Jack O'Roark of the Tomal Supply Co. ² The sales representatives allegedly gave appellant kickbacks or rebates of 10% of the amount of supplies ordered by the county from their businesses. The government also alleged that the sales representatives occasionally prepared bogus invoices and vouchers for payment for supplies which had not been ordered, with the cooperation of appellant; the sales representatives and appellant then allegedly split the amount of the bogus invoice or voucher. Appellant testified on his own behalf and denied ever taking a bribe or kickback from either Baldwin or O'Roark.

The jury found appellant guilty on all counts. This appeal followed.

I. RICO

Appellant first argues that neither the office of county judge nor the government of Craighead County, Arkansas, is an "enterprise" as defined in RICO, 18 U.S.C. § 1961(4). ³ Appellant argues that the term "enterprise" does not include government agencies or offices, citing United States v. Mandel, 415 F.Supp. 997, 1020-22 (D.Md.1976), rev'd on other grounds, 591 F.2d 1347 (4th Cir.), vacated on other grounds by an equally divided court, 602 F.2d 653 (1979) (banc), cert. denied, 445 U.S. 961, 100 S.Ct. 1647, 64 L.Ed.2d 236 (1980), and United States v. Anderson, supra, 626 F.2d at 1365-72.

In response the government argues that appellant has improperly raised this argument for the first time on appeal. The government further argues that a government agency, such as the office of county judge, is an "enterprise" under RICO. ⁴

For the purposes of this appeal, we characterize appellant's argument as an attack upon the indictment for failure to charge an offense, an objection which can be made at any time. See United States v. Thomas, 144 U.S.App.D.C. 44, 444 F.2d 919, 920 & n.1 (1971) (term "pendency of the proceeding" in Fed.R.Crim.P. 12(b)(2) has been interpreted to include appeals); see also Fed.R.Crim.P. 12(b)(2); 8 Moore's Federal Practice P 12.03(1) (2d ed. 1980); 1 C. Wright, Federal Practice and Procedure § 193, at 404 (1969).

As noted by appellant, this court in Anderson did not decide whether the term "enterprise" includes government agencies or offices. 626 F.2d at 1365 n.10. ⁵ The issue in Anderson was whether the term "enterprise" encompassed "an illegal association that is proved only by facts which also establish the predicate acts constituting the 'pattern of racketeering activity.' " Id. at 1365. The court in Anderson held that

the phrase "a group of individuals associated in fact although not a legal entity," as used in (the statutory) definition of the term "enterprise" in section 1961(4), (encompasses) only an association having an ascertainable structure which exists for the purpose of maintaining operations directed toward an economic goal that has an existence that can be defined apart from the commission of the predicate acts constituting the "pattern of racketeering activity."

(W)e do not rest our holding on the word "legitimate" but rather on the need for a discrete economic association existing separately from the racketeering activity.

Id. at 1372 (citations omitted). But see, e. g., United States v. Aleman, 609 F.2d 298, 303-05 (7th Cir. 1979), cert. denied, 445 U.S. 946, 100 S.Ct. 1345, 63 L.Ed.2d 780 (1980); United States v. Elliott, 571 F.2d 880, 900 (5th Cir.), cert. denied, 439 U.S. 953, 99 S.Ct. 349, 58 L.Ed.2d 344 (1978). At issue in Anderson was the nature of the relationship between the statutory terms "enterprise" and "pattern of racketeering activity." That relationship is not an issue in the present case. The indictment in the present case charged appellant with conducting the affairs of an enterprise (the office of county judge) through a pattern of racketeering activity (bribery and kickbacks). The indictment in the present case, therefore, does not raise the question of the nature of the relationship between the "enterprise" and the "pattern of racketeering" because the office of county judge "necessarily constitute(§ an enterprise) separate and distinct from the pattern of racketeering activity." 626 F.2d at 1365 n.10. ⁶ Here, the question is whether a government agency or office is an "enterprise" within the meaning of RICO. ⁷

We are persuaded that the term "enterprise" as used in RICO includes governmental agencies or offices. Webster's Third New International Dictionary 757 (P. Grove ed. 1966), defines "enterprise" as (1) a plan or design for a venture or undertaking, (2) venture, undertaking, project, especially an undertaking that is difficult, complicated, or has a strong element of risk, (3) a unit of economic organization or activity, especially a business organization, and (4) any systematic purposeful activity or type of activity. Under the broadest dictionary definition, "enterprise" could refer to any undertaking or "systematic purposeful activity." ⁸ Congress defined "enterprise" to include "any individual, partnership, corporation, association, or other legal entity, and any union or group of individuals associated in fact although not a legal entity." Under the language of the statutory definition, "enterprise" encompasses any "legal entity." The statutory language does not differentiate between government or public "legal entities" and private "legal entities." A government agency or office is a "legal entity." See United States v. Frumento, 405 F.Supp. 23, 29-30 (E.D.Pa.1975), aff'd, 563 F.2d 1083, 1089-92 (3d Cir. 1977) (bureau of cigarette and beverage taxes is a government agency and "legal entity"), cert. denied, 434 U.S. 1072, 98 S.Ct. 1256, 55 L.Ed.2d 775 (1978); United States v. Barber, 476 F.Supp. 182, 184 (S.D.W.Va.1979) (state alcohol beverage control commissioner); United States v. Vignola, 464 F.Supp. 1091, 1095-97 (E.D.Pa.) (city traffic court), aff'd mem., 605 F.2d 1199 (3d Cir. 1979), cert. denied, 444 U.S. 1072, 100 S.Ct. 1015, 62 L.Ed.2d 753 (1980). See generally Black's Law Dictionary 804 (5th ed. 1979) (defining legal entity as an entity with capacity to function legally, sue or be sued, and make decisions through agents). Finally, Congress could have used a term such as private or business or commercial enterprise but it did not do so. ⁹

Thus, we conclude that the language of the statutory definition of "enterprise," in particular the term "legal entity," includes government agencies or offices. See United States v. Brown, 555 F.2d 407, 415 n.15 (5th Cir. 1977) (RICO is "plain on its face" and covers government agencies), cert. denied, 435 U.S. 904, 98 S.Ct. 1448, 55 L.Ed.2d 494 (1978). We hold that the office of county judge is an "enterprise" under RICO. ¹⁰

We reject the contention that

in construing the statutory definition of "enterprise," the phrase "other legal entity" following nouns of narrow scope relating to different forms of business ventures, must be construed under the rule of ejusdem generis in the light of the narrow terms which follow to limit the term "enterprise" to private business or labor organizations (, whether engaged in lawful or unlawful activities).

United States v. Frumento, supra, 563 F.2d at 1089 (setting forth arguments of appellants). This argument is based upon the following language from United States v. Mandel :

None of the specific narrow nouns involved in this definition are public entities. They are rather a listing of the common legal forms in which business entities and labor groups fashion themselves to carry out their private functions. The more general references to "any (other) legal entity" and "any group of (individuals) associated in fact although not a legal entity" must be construed to be limited to the same type and class of entities which preceded it in the statutory definition.

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