U.S. v. Kirby, s. 78-1489

• Decision Date: 30 November 1978
• Docket Number: 78-1490,Nos. 78-1489,s. 78-1489
• Citation: 587 F.2d 876
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Robert KIRBY and James Curtis, Defendants-Appellants.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 876

587 F.2d 876

UNITED STATES of America, Plaintiff-Appellee, v. Robert KIRBY and James Curtis, Defendants-Appellants.

Nos. 78-1489, 78-1490.

United States Court of Appeals Seventh Circuit.

Argued Oct. 25, 1978.

Decided Nov. 30, 1978.

James H. Voyles, Jr., Indianapolis, Ind., for defendants-appellants.

Bernard L. Pylitt, Asst. U. S. Atty., Indianapolis, Ind., for plaintiff-appellee.

Before FAIRCHILD, Chief Judge, and CUMMINGS and PELL, Circuit Judges.

CUMMINGS, Circuit Judge.

In March 1977, a 12-count indictment was returned against defendants. Count I charged a conspiracy in violation of 18 U.S.C. § 371, the general conspiracy statute, in that from January 1, 1976, to December 9, 1976, defendants agreed to commit four offenses against the United States, namely,

A. To violate the mail fraud statute (18 U.S.C. § 1341) by scheming to obtain money by false pretenses from Central Soya Company through use of the mails; ¹

B. To bribe public officials in violation of 18 U.S.C. § 201(f) by giving money to two grain inspectors licensed by the United States Department of Agriculture under the United States Warehouse Act in return for their falsely certifying the grain they inspected to be of higher quality than it actually was;

C. To make false statements in violation of 18 U.S.C. § 1001 by causing false United States Warehouse Act inspection and weight certificates to be issued; and

D. To cause two licensed grain inspectors to issue false weight and inspection certificates, in violation of 7 U.S.C. § 270.

Eight overt acts in furtherance of the alleged conspiracy were listed in Count I. Counts II through IV charged defendants with the substantive offense of violating the mail fraud statute (18 U.S.C. § 1341), and Counts V through VIII charged them with the substantive offense of making false statements in violation of 18 U.S.C. § 1001. Counts IX through XII, which charged the defendants with causing the issuance of false or fraudulent weight and inspection certificates in violation of 7 U.S.C. § 270, were dismissed by the district court. ² A jury found defendants guilty under all of the remaining eight counts and they received concurrent sentences of six months on each count, plus fines aggregating $2500.

I. Sufficiency of Count I of Indictment

Relying on Hamner v. United States, 134 F.2d 592 (5th Cir. 1943), defendants first assert that Count I, the conspiracy count, is fatally defective because it "proceeded to allege substantive crimes which had been committed" (Br. 8). However, in Reno v. United States, 317 F.2d 499, 504 (5th Cir. 1963), certiorari denied, 375 U.S. 828, 84 S.Ct. 72, 11 L.Ed.2d 60, an indictment grammatically worded like the present one was sustained, with the court stating that if the Reno case "cannot be validly distinguished from Hamner, then we think Hamner is no longer good law." As noted, Count I of the present indictment charges that defendants agreed to violate three provisions of the Criminal Code and a provision of the Warehouse Act and specifies numerous overt acts committed in furtherance of the conspiracy. Although paragraphs A through D of Count I inartfully set forth what the defendants agreed to do in the past tense rather than the future tense, under the Reno rationale this Count I was sufficient. It contained enough to apprise the defendants with certainty what allegations they must be prepared to meet and put them in a position to plead double jeopardy to any subsequent charge of the same offense. The use of the past tense in paragraphs A-D of Count I therefore will be deemed harmless error. See Rule 7(c)(3) of the Federal Rules of Criminal Procedure.

II. Jurisdiction over Paragraphs B-D of Count I of Indictment

Defendants next contend that apart from the alleged mail fraud violation (under 18 U.S.C. § 1341) described in paragraph A of Count I, the other objects of the conspiracy, Viz., the alleged violations of 18 U.S.C. § 201(f), 18 U.S.C. § 1001, and 7 U.S.C. § 270, do not constitute offenses against the United States over which the district court had jurisdiction under the facts shown in the rest of the indictment.

(a) Bribery Charge

Paragraph B of Count I describing bribery in violation of 18 U.S.C. § 201(f) as one of the objects of the conspiracy is based on defendants' promising money to Kinley E. Gunder and Gary L. Byrd, both grain inspectors licensed by the United States Department of Agriculture under 7 U.S.C. § 252 and regulations thereunder (7 C.F.R. § 102.61 Et seq.). Defendants contend that those grain inspectors were not "public officials" within the purview of 18 U.S.C. § 201(f) which proscribes bribing "any public official" for past or future official acts. It is true that the inspectors were employed by Central Soya rather than by the Government. However, Congress provided for such grain inspectors to act on behalf of the Department of Agriculture in an official capacity. See 7 U.S.C. §§ 252, 256. That is sufficient to make them "public officials" because the bribery statute defines a "public official" as a "person acting for or on behalf of * * * any department (of the United States) * * * in any official function, under or by authority of any such department * * * " (18 U.S.C. § 201(a)). ³

Privately employed licensed grain inspectors under the United States Grain Standards Act ⁴ (7 U.S.C. §§ 71, 74, 79, 84-87h) and regulations thereunder have been considered public officials under 18 U.S.C. § 201(g). United States v. Fleetwood, 528 F.2d 528, 529 (5th Cir. 1976). ⁵ Similarly, Gunder and Byrd, licensed under the United States Warehouse Act, meet the definition of public official in 18 U.S.C. § 201(a) since they were acting "on behalf of" the Department of Agriculture by issuing the certificates required by the Warehouse Act and its implementing regulations. Therefore bribing them constitutes an offense against the United States under 18 U.S.C. § 201(f). In reaching this conclusion, we reject the defendants' principal contention, which in different guises underlies each of their objections to the jurisdiction of the district court under this indictment. The defendants insist that the Warehouse Act confers jurisdiction on the Department of Agriculture only over bailments of grain and not, as is the case here, over purchases of grain which is then stored by the purchaser in its own licensed warehouse. The argument turns on whether the term "stored" as used in the Act is the equivalent of "bailed" or is to be understood more colloquially as "held for future use."

The Warehouse Act empowers the Secretary of Agriculture to provide for the licensing of inspectors of "any agricultural product or products, stored or to be stored" in a licensed warehouse (7 U.S.C. § 252). These provisions of the statute are implemented by 7 C.F.R. § 102.19, which requires all storage and non-storage grain received into a licensed warehouse to be inspected, graded and weighed by a licensed inspector. Non-storage grain is defined in 7 C.F.R. § 102.2(k) as

"Grain received temporarily into a warehouse for conditioning, transferring, assembling for shipment, or lots of grain moving through a warehouse for current merchandising or milling use, against which no receipts are issued and no storage charges assessed * * *."

The regulations thus explicitly adopt a broad, nontechnical interpretation of "stored" grain to include all grain kept in a licensed warehouse, not merely grain which is held as a bailment and for which warehouse receipts have been issued. Although the defendants correctly note that "non-storage grain" is not defined in the statute, they do not directly attack the regulations. Judge Steckler expressly adopted a broad interpretation of "stored" which is consistent with the regulations (Tr. 383-384, 472-474). We think this is the correct reading of the statutory language.

Defendants insist that the purpose of the Act was to foster confidence in warehouse receipts for grain stored as a bailment in order to facilitate financing. While this clearly was an important purpose of the Act, the legislative history suggests that broader goals of protecting the agricultural commodities themselves and establishing consistent standards also motivated the Act's passage. See Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 235 n. 13, 67 S.Ct. 1146, 91 L.Ed. 1447. In any event, the statutory language does not support the narrow reading advocated by defendants. ⁶

We conclude that it is immaterial that the grain delivered by defendants to Central Soya Company was sold to it rather than merely stored with it, since Central Soya's storage of the purchased grain in its own warehouse brings the Act into play. The term "warehouse" as used in the Warehouse Act includes "every building * * * in which any agricultural product is or may be stored" (7 U.S.C. § 242). Since the Act provides for the licensing of inspectors of "any agricultural product or products, stored or to be stored" in a licensed warehouse (7 U.S.C. § 252), such inspectors, including the defendants here, are "public officials" for purposes of 18 U.S.C. § 201.

(b) False Statements Charge

Paragraph C of Count I describing false statements in violation of18 U.S.C. § 1001 as another object of the conspiracy charges that defendants caused false and incorrect United States Warehouse Act inspection and weight certificates to be executed and issued under the Warehouse Act (7 U.S.C. §§ 241 Et seq.). Counsel for defendants again argues that paragraph C does not allege an offense against the United States because the false statements were made to Central Soya, a private purchaser of grain. However, as explained above, 7 U.S.C. § 252 places the regulation of the storage of agricultural products in all licensed warehouses within the jurisdiction of the Department of Agriculture. Because this object of the conspiracy was to have Gunder and Byrd "in any matter within the jurisdiction of any department * * * of the United...