U.S. v. Long

• Decision Date: 26 May 1983
• Docket Number: 82-1424 and 82-1426,Nos. 82-1423,s. 82-1423
• Parties: 13 Fed. R. Evid. Serv. 953 UNITED STATES of America, Plaintiff-Appellee, v. Frank M. LONG, Steak N' Lobster, Inc., Reagan Joe Baker, Defendants-Appellants.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1044

706 F.2d 1044

13 Fed. R. Evid. Serv. 953

UNITED STATES of America, Plaintiff-Appellee, v. Frank M. LONG, Steak N' Lobster, Inc., Reagan Joe Baker Defendants-Appellants.

Nos. 82-1423, 82-1424 and 82-1426.

United States Court of Appeals Ninth Circuit.

Argued and Submitted March 7, 1983.

Decided May 26, 1983.

Monte E. Hester and James Buckley, Tacoma, Wash., for plaintiff-appellee.

James R. Moore, Asst. U.S. Atty., Seattle, Wash., for defendants-appellants.

Appeal from the United States District Court for the Western District of Washington.

Before GOODWIN, ALARCON, and FERGUSON, Circuit Judges.

ALARCON, Circuit Judge.

Appellants Frank Long, Reagan Joe Baker, and Steak N' Lobster, Inc., appeal their convictions for conspiracy and theft in violation of 18 U.S.C. Secs. 641, 642. Frank Long also appeals his conviction for making false declarations to a grand jury in violation of 18 U.S.C. Sec. 1623. We affirm.

I. PERTINENT FACTS

The charges in this case arose out of a scheme to steal raw meat from the Fort Lewis army base in Washington.

Andrew Pruitt was the Chief Supervisor at the Fort Lewis commissary meat department. In 1978, Pruitt, Patrick Weber, and Reagan Joe Baker formed a corporation to operate two restaurants in the state of Washington known as Steak N' Lobster, Incorporated. Reagan Joe Baker was employed by the corporation to act as the manager of the Steak N' Lobster restaurant on Pine Street in Tacoma, Washington.

While acting as chief supervisor of the commissary meat department at Fort Lewis, Pruitt and Frank Long, another supervisor at Fort Lewis, diverted meat which had been ordered specifically for Fort Lewis to various locations including Pruitt's restaurant, Steak N' Lobster.

The meat was diverted in two ways. The first method involved an arrangement between Pruitt and two drivers from Randy's Meats (hereafter Randy's), the wholesale meat supplier to Fort Lewis. Randy's drivers would deliver meat to the Fort Lewis base. Commissary personnel would examine the meat. Thereafter, at Pruitt's or Long's direction, portions of the meat were returned to the truck, and the driver was instructed to deliver the meat to various locations, including the Steak N' Lobster restaurant.

Under the alternate scheme, Pruitt would instruct Randy's to set aside an order of meat for Fort Lewis in a "will-call" trailer to be picked up at a later date. Randy's personnel would mark the top boxes "Fort Lewis." The number on each box was entered on the invoices prepared for Fort Lewis. Weber, after representing to Randy's that he was acting on behalf of Pruitt, would pick up the meat and deliver it to the Steak N' Lobster restaurants.

In 1980, the FBI began an investigation into the theft of meat from Fort Lewis. Long was subpoenaed to appear before the grand jury. He testified that he had no knowledge of the thefts. The first grand jury failed to return an indictment. The government presented its case before a second grand jury and an indictment was returned.

Three months prior to trial, Pruitt was killed in a hunting accident. Before his death, Pruitt executed a written statement exculpating Weber and Baker of any wrongdoing.

At the pretrial hearing, Long made various motions. Each was denied. At trial the district court refused to admit Pruitt's exculpatory statement.

The jury found Long guilty of one count of conspiracy, six counts of theft and one count of perjury. Baker and Steak N' Lobster were found guilty of one count of conspiracy and six counts of theft.

II. BAKER & STEAK N' LOBSTER'S CONTENTIONS ON APPEAL Government Interest in the Meat

Baker and Steak N' Lobster contend that the government failed to prove the meat was government property as required by 18 U.S.C. Sec. 641.

Section 641 provides in relevant part: "whoever ... steals, purloins, or knowingly converts to his use or the use of another ... any thing of value (of $100.00 or more) of the United States or of any Department or agency thereof ... shall be fined not more than $10,000.00 or imprisoned not more than ten years, or both; ..."

Thus, under Sec. 641 an essential element of the crime of stealing property belonging to the United States is that the government: (1) had an interest in the goods stolen, and (2) suffered a property loss. United States v. Collins, 464 F.2d 1163, 1165 (9th Cir.1972). Proof that the property belonged to the federal government is also essential to give the United States District Court jurisdiction over the alleged theft. United States v. Howey, 427 F.2d 1017, 1018 (9th Cir.1970). While it is true that this issue is being raised for the first time on appeal, we must address it because questions involving subject matter jurisdiction cannot be waived. Libhart v. Santa Monica Dairy Co., 592 F.2d 1062, 1064 (9th Cir.1979).

We review this issue under the principle that "[t]he evidence and its inferences ... must be viewed in a light most favorable to the government as prevailing party," United States v. Ponticelli, 622 F.2d 985, 987 (9th Cir.), cert. denied, 449 U.S. 1016, 101 S.Ct. 578, 66 L.Ed.2d 476 (1980). No issue of fact was raised during the trial concerning existence of title, delivery or possession. Therefore, the facts were uncontested. Accordingly, we must view these uncontested facts in the light most favorable to the government in determining if the United States had a sufficient interest in the raw meat ordered for Fort Lewis to satisfy the requirements of section 641.

We are entitled to infer, in the absence of any evidence to the contrary, that the district court was satisfied that the government had title to the meat before any theft occurred.

This court has recognized that a " 'substantial federal interest' sufficient to satisfy the elements of section 641 is present when the government has 'title to, possession of or control over' the object in question." United States v. Hughes, 626 F.2d 619, 622 (9th Cir.1980); United States v. Johnson, 596 F.2d 842, 846 (9th Cir.1979).

Steak N' Lobster and Baker argue that the United States did not have title to the meat nor was it in its possession at the time the thefts occurred. It is their view that Randy's retained exclusive control over the meat until the thefts occurred. We are also told that the government never had a property or possessory interest because the meat never was delivered to Fort Lewis.

While it is true that the government did not have actual possession of the meat that was placed in Randy's "will-call" trailer prior to the theft, it is the opinion of this court that there is substantial evidence in this record to show sufficient title and control to meet the requirements of section 641.

The agreement between Randy's and Fort Lewis was a government contract which is controlled by federal law. Clearfield Trust Co. v. United States, 318 U.S. 363, 367, 63 S.Ct. 573, 575, 87 L.Ed. 838 (1943). Passage of title in this case is governed by 32 C.F.R. 7-103.6 which provides in pertinent part that: "Unless this contract specifically provides for earlier passage, title to supplies ... shall pass to the government upon formal acceptance, regardless of when or where the Government takes physical possession."

The regulation does not define "acceptance." Existing law, however, permits federal courts to examine the conduct of the parties in defining the terms of their contract. Gresham and Co., Inc. v. United States, 470 F.2d 542, 545, 200 Ct.Cl. 97 (1972); Sam Macri and Sons, Inc. v. United States, 313 F.2d 119, 124 (9th Cir.1963). In addition, when there is an ambiguity in federal law, we may use uniform state laws, such as the Uniform Commercial Code (UCC) to help clarify ambiguities. E.g., Bituminous Casualty Corp. v. Lynn, 503 F.2d 636, 640 (6th Cir.1974); Security Life and Accident Ins. Co. v. United States, 357 F.2d 145, 148 (5th Cir.1966). The Uniform Commercial Code provides us with adequate legal guidelines to resolve this issue. The record before us discloses that Richard Fisher, president of Randy's, testified that when Pruitt ordered meat for Fort Lewis, he requested that the meat be selected and then be set aside for pickup at a later date. As noted above, pursuant to Pruitt's instructions, Randy's employees marked the boxes of meat with the words "Fort Lewis" and numbered the containers to correspond with the number which appeared for that item on the invoice prepared for the government. The meat was then placed in Randy's "will-call" trailer for pickup by Fort Lewis personnel.

The first principle which bears on this case is that title to goods cannot pass under a contract of sale until specific goods have been identified as the objects to be sold pursuant to the terms of the agreement. See UCC Sec. 2-401(1). Such identification occurs when certain goods are "marked or otherwise designated by the seller as goods to which the contract refers." UCC Sec. 2-501(1)(b).

The past course of conduct followed by Randy's and Pruitt in the purchase and sale of meat was clearly sufficient to establish that the meat was identified as having been ordered pursuant to the contract with the United States under UCC Sec. 2-501(1).

The Uniform Commercial Code is also instructive as to when title passes to identified goods. UCC Sec. 2-401(2) provides that title passes at the time and place at which the seller completes his performance with reference to physical delivery of the goods.

The meat taken from the will-call trailer had been marked, identified and stored in a special place at Randy's to be picked up by Pruitt's agent. Randy's performance was complete prior to the time the meat was picked up by the thief. Thus, title passed to the government prior to the theft.

We are satisfied from our analysis of the law which applies to commercial transactions, and the conduct of the parties as reflected in this record, that the United States had a property interest in the meat sufficient to comply with the jurisdictional...