U.S. v. Hall, 86-1159

• Decision Date: 18 September 1986
• Docket Number: No. 86-1159,86-1159
• Citation: 801 F.2d 356
• Parties: UNITED STATES of America, Appellee, v. Kenneth HALL, Appellant.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 356

801 F.2d 356

UNITED STATES of America, Appellee, v. Kenneth HALL, Appellant.

No. 86-1159.

United States Court of Appeals,

Eighth Circuit.

Submitted Sept. 9, 1986.

Decided Sept. 18, 1986.

R. Thomas Day, Asst. Federal Public Deputy, St. Louis, Mo., for appellant.

Steven Holtshouser, Asst. U.S. Atty., St. Louis, Mo., for appellee.

Before LAY, Chief Judge, HENLEY, Senior Circuit Judge, and BOWMAN, Circuit Judge.

HENLEY, Senior Circuit Judge.

Defendant Kenneth Hall appeals from his conviction for attempting to pass an altered obligation in violation of 18 U.S.C. Sec. 472. Defendant was convicted on one count of a two-count indictment following a jury trial and sentenced to three years imprisonment, all but six months suspended, and a special assessment of $500.00. Defendant argues on appeal that the district court ¹ erred in refusing to instruct the jury as requested in his proposed jury instructions one and two. We affirm.

On August 7, 1985 defendant Hall approached Michael Chalmers, a gas station attendant at a Shell Station in St. Louis, Missouri. Hall produced an altered $10.00 Federal Reserve Note which purported to be a $100.00 note and requested Chalmers to give him change. ² Chalmers immediately recognized the note as bogus and suggested that Hall try the Bonafide Station down the street. After Hall left Chalmers alerted Mattie Rochelle Nelson, the cashier on duty at the Bonafide Station, that Hall was coming and would attempt to pass a phony $100.00 note. Chalmers called the police when Nelson reported that Hall was on his way.

Hall attempted to pass the altered note to Nelson at the Bonafide Station and offered to purchase $50.00 worth of merchandise in the process. Nelson immediately recognized the note as being false and pulled it apart in front of Hall. Nelson then kept Hall occupied until the police arrived and arrested him. Hall was indicted on two counts of attempting to pass an altered obligation in violation of Sec. 472. Following a jury trial Hall was convicted on Count II of the indictment for the transaction at the Bonafide Station. This appeal followed.

Hall contends that the district court erred in not reading to the jury defendant's proposed instruction number one which reads:

An item is an altered obligation of the United States if it bears such a likeness or resemblance to a genuine obligation of the United States as is calculated to deceive an honest, sensible, and unsuspecting person of ordinary observation and care dealing with a person supposed to be honest and upright.

(Emphasis supplied.) This instruction is substantially the same as that found in E. Devitt & C. Blackmar, Federal Jury Practice and Instructions Sec. 52.10 (3d ed. Supp.1986), with the fundamental difference of the emphasized portion. In the original, the emphasized portion simply reads, " 'counterfeit.' " Further, the instruction is entitled, " 'Counterfeit'--Defined." This instruction has come to be known as the "similitude" requirement and is generally given in prosecutions for possession of counterfeit currency. The grand jury in this case, however, did not indict defendant for attempting to pass or possession of a counterfeit obligation. The indictment charged defendant with attempting to pass an altered obligation of the United States in violation of Sec. 472. In determining whether the similitude requirement applies in this case, we trace briefly the roots of that doctrine.

The similitude requirement appears to have been first stated in a reported decision in United States v. Sprague, 48 F. 828, 829 (E.D.Wisc.1882), and later in United States v. Kuhl, 85 F. 624, 631 (S.D. Iowa 1898). Both of these cases quoted with approval from an unreported district court manuscript, United States v. Wilson (E.D.Ark. date unknown). ³

In Kuhl the defendant was indicted for violating Sec. 5430 of the Revised Statutes and the defendant in Sprague was convicted of violating the same statute. ⁴ Section 5430 is a possession offense as is the current version of that section. 18 U.S.C. Sec. 474 (paragraph 5). The similitude jury charge has received general acceptance in Sec. 474 prosecutions. United States v. Turner, 586 F.2d 395, 397-98 (5th Cir.1978), cert. denied, 440 U.S. 926, 99 S.Ct. 1258, 59 L.Ed.2d 480 (1979); Minnella v. United States, 44 F.2d 48, 49 (8th Cir.1930). The prosecution in this case, however, arose under Sec. 472, which reads:

Whoever, with intent to defraud, passes, utters, publishes, or sells, or attempts to pass, utter, publish, or sell, or with like intent brings into the United States or keeps in possession or conceals any falsely made, forged, counterfeited, or altered obligation or other security of the United States, shall be fined not more than $5,000 or imprisoned not more than fifteen years, or both.

This statute does not contain the term "similitude" as does Sec. 474, but speaks in more specific terms of falsely made, forged, counterfeited, or altered obligation. The courts have, however, extended the Wilson similitude test to Sec. 472 prosecutions in order to define the term "counterfeit."

The earliest application of the similitude requirement to a Sec. 472 prosecution found by the court is the 1963 case of United States v. Smith, 318 F.2d 94, 95 (4th Cir.1963). Smith ran a confidence scheme that involved the sale of a machine to make money. At the time of his arrest Smith had in his possession two slips of paper the size of a $10.00 Federal Reserve note. The front of each note bore a faint, reverse facsimile, of a Federal Reserve note. The backs were blank. The court relied on a dictionary definition of counterfeited to mean "imitated, simulated, feigned or pretended," Smith, 318 F.2d at 95 (citing, 2 Oxford Dictionary 1066 (1933 ed.) ), and adopted the Wilson similitude test to find as a matter of law that the two slips of paper were not counterfeits. Smith, 318 F.2d at 95. Thus, the Wilson similitude test has come to be used as a definition of the term "counterfeit" in Sec. 472. Federal Jury Practice and Instructions Sec. 52.10; United States v. Brunson, 657 F.2d 110, 114 (7th Cir.1981), cert. denied, 454 U.S. 1151, 102 S.Ct. 1019, 71 L.Ed.2d 306 (1982); Turner, 586 F.2d at 398 n. 7; United States v. Chodor, 479 F.2d 661, 664 (1st Cir.), cert. denied, 414 U.S. 912, 94 S.Ct. 254, 38 L.Ed.2d 151 (1973); United States v. Johnson, 434 F.2d 827, 829 (9th Cir.1970).

Significantly, all these cases contain two very important characteristics. First, they involved "counterfeit" obligations of exceptionally poor quality or varying degrees of completeness. Thus, these cases called for a clear definition of what was meant by counterfeit. Second, the cases also involved possession offenses rather than passing or attempting to pass offenses. This distinction is important because all violations of Sec. 472 require an intent to defraud. In a possession offense the intent to defraud is difficult to prove when the quality of the counterfeit is poor. The importance of these characteristics as they relate to the criminal intent required to sustain a conviction under Sec. 472 was recognized by the Ninth Circuit. In discussing some very poor, apparently unfinished, "counterfeits" found in a defendant's possession, the court wrote:

There is no evidence that defendant intended to use, pass or utter them as genuine, a kind of evidence which we think is important in cases involving bad or borderline counterfeits not only on the issue of intent to defraud but on the issue of the quality of the counterfeit, that is, whether it is in fact an imitation in resemblance of a genuine obligation of the United States. The defendant's intent, demonstrated by his conduct, should have a bearing on whether they were made as imitations of genuine obligations.

Johnson, 434 F.2d at 829.

Prior to passing or attempting to pass the obligation, a violation of Sec. 472 may hinge on the question whether the obligation is in such a state of completion or quality that the jury can (1) conclude that it is a counterfeited obligation, and (2) find the requisite intent to defraud. ⁵ Similitude has developed primarily as a definition of counterfeit and secondarily as an aid to determining fraudulent intent when the offense is one of possession. Here, the court must determine whether the similitude instruction requested by defendant appropriately relates to a charge of attempting to pass an altered obligation of the United States.

The verb "alter" is defined "to cause to become different in some particular characteristic (as measure, dimension, course, arrangement, or inclination) without changing into something else." Webster's Third New International Dictionary p. 63 (1971); see also Smith v. United States, 74 F.2d 941, 942 (5th Cir.1935) (alter "means to change without destroying the identity of the thing changed"). The courts have found a variety of changes in a genuine obligation to amount to an alteration without necessitating an elaboration or definition of the phrase "altered obligation." See United States v. DeFilippis, 637 F.2d 1370, 1372-73 (9th Cir.1981) (one-dollar bill with the end of a ten-dollar bill taped over it is altered); United States v. Drumright, 534 F.2d 1383, 1385 (10th Cir.) (middle of a one-dollar bill and portions of fifty-dollar bills taped together was an altered obligation), cert. denied, 429 U.S. 960, 97 S.Ct. 385, 50 L.Ed.2d 327 (1976); Barbee v. United States, 392 F.2d 532, 533 (5th Cir.) (genuine bill with serial number changed is an altered note), cert. denied, 391 U.S. 935, 88 S.Ct. 1849, 20 L.Ed.2d 855 (1968); Smith, 74 F.2d at 941-42 (split bill with only back remaining is altered); and Hill v. United States, 275 F. 187, 188 (7th Cir.1921) (one-dollar note changed to appear to be a ten-dollar note is altered). ⁶ These cases suggest the central elements for a definition of the phrase "altered obligation:"

(1) The underlying obligation must be a genuine obligation of the United...