U.S. v. Krause, 74-1402

• Decision Date: 24 January 1975
• Docket Number: No. 74-1402,74-1402
• Citation: 507 F.2d 113
• Parties: 88 L.R.R.M. (BNA) 2856, 76 Lab.Cas. P 10,620 UNITED STATES of America, Plaintiff-Appellee, v. Joseph KRAUSE, Defendant-Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 113

507 F.2d 113

88 L.R.R.M. (BNA) 2856, 76 Lab.Cas. P 10,620

UNITED STATES of America, Plaintiff-Appellee, v. Joseph KRAUSE, Defendant-Appellant.

No. 74-1402.

United States Court of Appeals, Fifth Circuit.

Jan. 24, 1975, Rehearing Denied March 4, 1975.

Neal R. Sonnett, David A. Russell, Miami, Fla., for defendant-appellant.

Robert W. Rust, U.S. Atty., Miami, Fla., Mervyn Hamburg, Dept. of Justice, Washington, D.C., for plaintiff-appellee.

Appeal from the United States District Court for the Southern District of Florida.

Before BROWN, Chief Judge, and BELL and MORGAN, Circuit Judges.

LEWIS R. MORGAN, Circuit Judge:

After a trial to a jury, appellant was convicted of making a false statement in violation of 18 U.S.C. 1001 (1966) ¹ and was sentenced to imprisonment for three months, followed by two years probation. Krause, the defendant below, appeals, alleging that his unsworn responses to questions propounded by a National Labor Relations Board Hearing Officer at a formal hearing did not constitute a 'statement' within the meaning of 18 U.S.C. 1001. He also claims that the trial court incorrectly refused to allow a former hearing officer to testify to the weight generally given by regional directors to unsworn statements contained in a transcript of an NLRB hearing. For the reasons enunciated below we affirm the appellant's conviction.

I.

During February and March, 1972, representatives of the International Association of Machinists and Aero Space Workers (hereinafter referred to as 'IAM') made an unsuccessful attempt to organize the employees of Air LaCarte Florida, Inc., a Miami, Florida airline food catering company. When IAM's efforts continued, Air LaCarte's president, Victor Damiano, considered, as an alternative to total opposition to unionization, the possibility of agreeing to his employees being organized by a union friendlier to him than IAM.

Thereafter officials of the United Textile Workers of America (hereinafter referred to as 'UTW'), headquartered in New Jersey, were sent to Air LaCarte to attempt to obtain signatures of employees on cards evidencing a desire to hold an election on the question of representation by UTW. Many Air LaCarte employees signed cards on behalf of both unions.

On June 28, 1972, IAM filed with the regional office of NLRB a 'petition for election,' which, if approved, would have permitted employees of Air LaCarte to vote by secret ballot under NLRB supervision on the question of unionization under IAM. On July 25, a fact-finding hearing was conducted by the NLRB. Appellant, an international vice-president of UTW, and his attorney represented UTW as an intervenor. During the course of the hearing, the hearing officer attempted to ascertain the exact point in time a contract between UTW and the company was signed. The following exchange between the hearing officer and the appellant then occurred:

Hearing Officer: The agreement referred to in this hearing was executed on behalf of the Union by Joseph Krause. Is that you, Mr. Krause?

Mr. Krause: Yes, sir.

Hearing Officer: What time of day was this drafted, do you know, sir?

Mr. Krause: Well, it was during the course of the day. We met in the afternoon and it was done around-- I can't remember exactly. There was quite a bit of negotiating. Sometime around, say-- we were there 'til around four or five o'clock, eight o'clock.

Hearing Officer: It was signed in the afternoon?

Mr. Krause: It was up in the evening. Yeah.

Hearing Officer: In the early evening?

Mr. Krause: Yes.

Hearing Officer: Between four or five o'clock to eight o'clock?

Mr. Krause: It was actually signed about eight o'clock.

Hearing Officer: On the day of June 28th?

Mr. Krause: Yes, sir.

Krause's remarks, although not under oath, were clearly made 'on the record' and were included in the transcript of the hearing.

After examining the record, including the transcript, the NLRB Regional Director dismissed IAM's petition under the 'contract in bar' rule which provides that a collective bargaining contract executed with one union on the same day that a petition for election is filed bars further processing of the petition, if the contract was to take effect immediately and the employer was unaware of the filing of the petition when the contract was signed.

It later appeared that UTW's contract with Air LaCarte was executed not on June 28, but on June 29, and had been back-dated. Records of the union and those of an airline, as well as appellant's own grand jury testimony, reflected that he had been in upstate New York on June 28 and had not flown to Miami, where the contract was negotiated and signed, until June 29.

On July 24, 1973, a federal grand jury returned a six-count indictment against Krause and six other individuals for crimes alleged to have been committed in the course of the union's organization of the Florida corporation. All of the defendants except Krause were ultimately acquitted of the charges against them, either by the court or the jury.

During the course of the trial, Krause's attorney attempted to introduce into evidence the testimony of Donald R. Holley, a former hearing officer of the NLRB. Krause's attorney attempted to show that unsworn testimony is not considered in the decision-making process and therefore is immaterial. Hence, Krause's answer would not have been capable of influencing the board's decision.

The court did not allow a complete examination of Holley on this point and prohibited Krause's attorney in his summation from making reference to the testimony of Holley on the subject of materiality. After due deliberation, the jury found Krause guilty of violating 18 U.S.C. 1001, and he was sentenced on December 27, 1973.

II.

Appellant first contends that the false statement charged to Krause is found only in the last response of his colloquy with the hearing officer:

Hearing Officer: On the day of June 28th? Mr. Krause: Yes, sir.

Appellant then asserts that this reponse was not within the class of false statements that 1001 was designed to proscribe.

The present 18 U.S.C. 1001 has its origin in a statute passed almost one hundred years ago in the wake of a spate of frauds on the government. United States v. Bramblett, 348 U.S. 503, 504, 75 S.Ct. 504, 99 L.Ed. 594 (1955). The original provision clearly covered the presentation of false claims against any instrumentality of government to any officer of the government. Id. at 505. False statements made for the purpose of obtaining the approval of payment of any kind were also proscribed. Id. In 1934 the false statement section was amended so as to delete all words as to purpose and to insert 'in any matter within the jurisdiction of any department or agency of the United States . . ..' The statute was presumably revised so as to reach not only false statements in connection with claims against the government but also in connection with non-monetary frauds. United States v. Gillliland, 312 U.S. 86, 93, 61 S.Ct. 518, 85 L.Ed. 598 (1941).

The amendment to the statute occurred during the New Deal period when government agencies began entering the field of economic regulation. Friedman v. United States, 374 F.2d 363, 366 (8th Cir. 1967). 'For a proper functioning of their regulative and reform power these agencies depended upon information supplied by individuals and corporations with which they were dealing. The giving of false information to these agencies would, of course, seriously pervert their functions, making effective regulation impossible . . .. Obviously, the immediate and primary purpose in amending the old 'fraudulent claims' statute was to curtail the flow of false information to these newly created regulative agencies.' Id.

Thus, included within the purview of the statute were statements which involved no pecuniary loss to the government but which by their falseness perverted the function of some government agency. United States v. Gilliland, 312 U.S. 86, 93, 61 S.Ct. 518, 85 L.Ed. 598 (1941). In 1948, the statute was put into its present form, the false statement provision becoming 18 U.S.C. 1001. United States v. Bramblett, 348 U.S. 503, 508, 75 S.Ct. 504, 99 L.Ed. 594 (1955).

Courts have applied this statute to oral as well as written statements and unsworn as well as sworn statements. United States v. Beacon Brass Company, Inc., 344 U.S. 43, 46, 73 S.Ct. 77, 97 L.Ed. 61 (1952); United States v. Ratner, 464 F.2d 101 (9th Cir. 1972); United States v. Adler, 380 F.2d 917 (2nd Cir. 1967), cert. denied, 389 U.S. 1006, 88 S.Ct. 561, 19 L.Ed.2d 602 (1967). Moreover, for purposes of the statute, a false statement has been deemed to have been made in a manner within the jurisdiction of the federal agency even if it was not made to the agency itself, if inevitably the agency had been deceived. United States v. Candella, 487 F.2d 1223 (2nd Cir. 1973), cert. denied, 415 U.S. 977, 94 S.Ct. 1563, 39 L.Ed.2d 872 (1974).

Appellant correctly notes that certain statements while materially false, have been held to fall beyond the parameters of 18 U.S.C. 1001. Several courts have held 1001 inapplicable to statements made to government agents acting in a purely investigative capacity. See Paternostro v. United States, 311 F.2d 298, 302-303 (5th Cir. 1962). Although the line between 'administration' and 'investigation' cannot be sharply drawn, the argument has been made that this statute was intended to apply only to federal government 'administration' and not intended to compel citizens to answer truthfully every question put to them in the course of a federal police or federal criminal investigation. United States v. Levin, 133 F.Supp. 88 (D.Colo.1953). 1953).

However, appellant incorrectly relies upon United States v. Stark, 131 F.Supp. 190 (D.Md.1955) and Paternostro v. United States, 311 F.2d 298 (5th Cir. 1962). In Stark, the court held that negative answers given under oath to FBI agents who were investigating reports of an alleged...