U.S. v. King

• Decision Date: 07 October 1977
• Docket Number: D,No. 86,86
• Parties: 77-2 USTC P 9717 UNITED STATES of America, Appellee, v. Francis E. KING, Appellant. ocket 77-1221.
• Court: U.S. Court of Appeals — Second Circuit

Page 559

563 F.2d 559

77-2 USTC P 9717

UNITED STATES of America, Appellee, v. Francis E. KING, Appellant.

No. 86, Docket 77-1221.

United States Court of Appeals, Second Circuit.

Argued Sept. 15, 1977.

Decided Oct. 7, 1977.

Murray Appleman, New York City, for appellant. ^*

Alvin A. Schall, Asst. U. S. Atty., Eastern District of New York, Brooklyn, N. Y. (David G. Trager, U. S. Atty., Eastern District of New York, Brooklyn, N. Y., of counsel), for appellee.

Before GURFEIN and VAN GRAAFEILAND, Circuit Judges, and COFFRIN, District Judge. ^**

GURFEIN, Circuit Judge:

Appellant Francis King, a former New York City policeman, was convicted after a jury trial on four counts of an indictment charging violations of federal income tax laws, 26 U.S.C. §§ 7206(1) and 7201. ¹

King makes several contentions on appeal. The most substantial is an argument that certain evidence admitted against him should have been barred under the doctrine of collateral estoppel. He contends that the Government should not have been permitted to introduce evidence of illegal payments to him in this tax evasion case because the same alleged payments had been admitted in a prior criminal prosecution for conspiracy to violate the civil rights of victims by extortion and appellant had been acquitted on those charges.

The previous prosecution charged a conspiracy among members of the Special Investigation Unit (SIU) of the New York City Police Department from 1969 to 1972 to deprive citizens of their civil rights by subjecting them to illegal surveillance and by extorting payoffs from them in violation of 18 U.S.C. § 241. Appellant was acquitted on the conspiracy charged. The Government had relied heavily on the testimony of a former SIU sergeant, John White, an admitted participant in the conspiracy who testified to the receipt of illegal payoffs by appellant. The Government in the earlier prosecution had also introduced documentary evidence concerning expenditures made by appellant in excess of his salary as a police officer. Substantially the same evidence was introduced in the tax trial to demonstrate that King had income on which he paid no tax.

Prior to the tax trial, appellant moved to have the White testimony and the expenditures proof barred on grounds of collateral estoppel. Judge Weinstein properly denied the motion.

Ashe v. Swenson, 397 U.S. 436, 90 S.Ct. 1189, 25 L.Ed.2d 469 (1970), held that the Fifth Amendment guarantee against double jeopardy embodies collateral estoppel as a constitutional requirement. In United States v. Cala, 521 F.2d 605, 608 (2d Cir. 1975), we held that the defendant has the burden of establishing that the issue which he seeks to foreclose from consideration was "necessarily" determined in his favor in a prior prosecution. When the prior proceeding was a jury trial, the burden is a heavy one, since "it usually cannot be determined with any certainty upon what basis the previous jury reached its general verdict," United States v. Gugliaro, 501 F.2d 68, 70 (2d Cir. 1974); United States v. Seijo, 537 F.2d 694, 697 (2d Cir. 1976), cert. denied, 429 U.S. 1043, 97 S.Ct. 745, 50 L.Ed.2d 756 (1977).

In the instant case, appellant has failed to discharge the burden of showing that the issues he seeks to foreclose were necessarily determined in his favor in the conspiracy case. There are a number of plausible explanations for the jury's failure to convict King in 1976 aside from the possibility that it may have disbelieved White. The jury may reasonably have found, though they thought White to be credible, that although King committed certain extortionate acts, they were single spontaneous acts, not part of a conspiracy, or not part of a single conspiracy as the indictment charged. Or the jury may have accepted the argument made by King's counsel in his summation that no overt act in the conspiracy was committed after December 1970 and that, therefore, the prosecution was barred by the statute of limitations.

As to the evidence concerning expenditures, the jury in the 1976 conspiracy case could have believed that appellant did in fact make purchases substantially in excess of his reported income but that the Government failed to prove beyond a reasonable doubt that the purchases were subsidized by funds extorted through the conspiracy. That King made such expenditures was not even contested at the first trial. Thus, Judge Weinstein, who presided at both trials and was therefore familiar with the evidence adduced, could properly conclude that King failed to establish that the issue of White's credibility and the fact of King's unaccounted for sources of income were necessarily determined adversely to the Government in the 1976 conspiracy trial.

Appellant also urges that there was insufficient evidence to convict on each of the four counts on which he was convicted. We disagree.

Count One of the indictment alleged that King signed his 1970 income tax return knowing that it underestimated his adjusted gross income and hence contained a false statement as to a material matter. ² The Government employed the expenditures method to prove its case. It established the amount of King's purchases of goods and services not attributable to the resources at hand at the beginning of the year or to non-taxable receipts during the year. Calculated by that method, appellant's income was well in excess of $18,500, whereas appellant reported only $16,853 as adjusted gross income on his 1970 return. The term "well in excess" is used because the $18,500 figure that the Government documented did not include daily living expenses such as food, clothing and entertainment. Even if appellant is correct in his assertion that the IRS expert made certain small computational errors, this was an argument that could or should have been made to the jury. Based on the evidence presented, the jury could reasonably infer that there was a material discrepancy between appellant's actual and reported income.

Appellant also contends that the attribution to him of a zero net worth at the beginning of the taxable year 1970 is unsupportable because the Government knew from the earlier trial that White testified to his receipt of substantial illicit cash in the months of October through December 1969 which should have been...