U.S. v. Masters, 79-1068

• Decision Date: 17 December 1979
• Docket Number: No. 79-1068,79-1068
• Citation: 612 F.2d 1117
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Philip R. MASTERS, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1117

612 F.2d 1117

UNITED STATES of America, Plaintiff-Appellee, v. Philip R. MASTERS, Defendant-Appellant.

No. 79-1068.

United States Court of Appeals Ninth Circuit.

Dec. 17, 1979.

Rehearing Denied Feb. 22, 1980.

Mark E. Beck, Asst. U. S. Atty., Los Angeles, Cal., for plaintiff-appellee.

Michale P. Balaban, Balaban & Stern, Los Angeles, Cal., for defendant-appellant.

Appeal from the United States District Court for the Central District of California.

Before CHAMBERS and ANDERSON, Circuit Judges, and PALMIERI, ^* District Judge.

PALMIERI, District Judge:

On August 31, 1977, appellant, Philip R. Masters, and his travelling companion, Kathleen D. Shorkey, arrived at Los Angeles International Airport on a flight from Tokyo, Japan. They were arrested when secondary Customs examinations revealed that they were concealing certain items that should have been disclosed to the United States Customs Inspectors. Masters had concealed 6,060,000 Japanese yen, valued at the time at approximately $22,670, underneath his clothing. Shorkey had concealed a diamond and emerald ring beneath her blouse and seven unset diamonds and a diamond ring beneath a thick panty girdle that she had bought in Tokyo at the direction of Masters and the use of which was directed by him during the transpacific flight immediately prior to entry into the United States.

On October 19, 1978, an indictment was returned charging Masters and Shorkey with having concealed gems from United States Customs and charging Masters, alone, with having concealed 6,060,000 Japanese yen, in violation of 18 U.S.C. § 1001. ¹ Shorkey testified as a Government witness after securing a dismissal of the charges against her.

The jury returned a verdict finding Masters guilty as charged on both counts of the indictment. Considering the evidence in the light most favorable to the Government, Glasser v. United States, 315 U.S. 60, 80, 2 S.Ct. 457, 86 L.Ed. 680 (1942), we conclude that the judgment of conviction should be affirmed.

CONCEALMENT OF THE GEMS COUNT I

In July, 1977, Masters asked Shorkey to accompany him to Tokyo on a pleasure trip.

The two flew from Los Angeles to New York, where Masters spent a week meeting with a New York jeweler ² about the trip to the Orient. According to Shorkey's testimony at trial, before leaving New York for Tokyo, Masters gave her a diamond bracelet and two rings. Masters instructed her to place the bracelet on her wrist under her sleeve and the two rings on chains inside her blouse before boarding the plane. After they cleared Customs in Tokyo, Shorkey removed the jewelry and returned it to Masters.

Shorkey further testified that once they were in Tokyo, she shopped while Masters sold diamonds and played cards. Masters then directed Shorkey to return to New York to pick up another package of diamonds from the jeweler.

Several days after Shorkey returned to Tokyo from New York, Masters told her that he was in a hurry to return to Los Angeles and wanted to leave immediately. He asked her to assist him on the trip by concealing some gems beneath her clothing while they attempted to clear Customs in Los Angeles. Masters explained that he was afraid that Customs would seize the gems in satisfaction of the debt he owed the Internal Revenue Service. ³

Using Masters' money and at his request, Shorkey purchased a panty girdle in Tokyo. En route to Los Angeles, Masters gave Shorkey a package and a ring and told her to go to the bathroom of the plane and to place the package in her girdle and the ring around her neck. Upon her return, Masters said, "that's fine."

Masters and Shorkey proceeded to the primary Customs inspection table together. The primary Customs inspector determined that a secondary examination of Masters should be ordered. ⁴ During the secondary examination, the yen was found, concealed under Masters' clothing. Upon discovery of the yen, a secondary examination of Shorkey was conducted, revealing the gems.

Masters argues that in order for the conviction under Count I to comport with due process, the Government must show that Masters had either explicit or constructive notice that his possession of the gems, which were acquired in the United States, was material to Customs. He contends that the Customs declaration form ⁵ not only fails to give notice of the need to declare such gems, but affirmatively represents that only items acquired abroad are material to Customs.

This is a specious argument, as the Customs form clearly states: "All your baggage (Including handbags and hand-carried parcels ) may be examined." (emphasis in original) While Customs has a great interest in items acquired abroad, to determine whether they are dutiable, Customs is charged with the responsibility of inspecting and evaluating all merchandise upon its arrival into the United States from abroad. ⁶

The national interest in such inspection is clear. In Almeida-Sanchez v. United States, 413 U.S. 266, 272, 93 S.Ct. 2535, 2539, 37 L.Ed.2d 596 (1973), the Supreme Court, in the course of a discussion of the power of the Federal Government to exclude aliens from the country, stated:

It is . . . without doubt that this power can be effectuated by routine inspections and searches of individuals or conveyances seeking to cross our borders. As the Court stated in Carroll v. United States (267 U.S. 132, 45 S.Ct. 280, 69 L.Ed. 543): "Travellers may be so stopped in crossing an international boundary because of national self protection reasonably requiring one entering the country to identify himself as entitled to come in and his belongings as effects which may be lawfully brought in." 267 U.S. at 154 (45 S.Ct. at 285).

The regulations governing the declaration and entry of all items brought into the United States set forth a broad declaration requirement that assists Customs in fulfilling its responsibility. ⁷ In a discussion of the constitutionality of a border search, this court stated: "Realization of customs officials' special problems has resulted in courts giving the broadest interpretation compatible with our constitutional principles in construing the statutory power of customs officials." United States v. Stanley, 545 F.2d 661, 666 (9th Cir. 1976), Cert. denied, 436 U.S. 917, 98 S.Ct. 2261, 56 L.Ed.2d 757 (1978).

In Ogden v. United States, 303 F.2d 724, 742-43 (9th Cir. 1962), this court considered a false denial to the Air Force of Communist Party membership and construed Section § 1001 as follows:

18 U.S.C.A. § 1001 was intended to serve the vital public purpose of protecting governmental functions from frustration and distortion through deceptive practices, and it must not be construed as if its object were narrow and technical. It is immaterial that the filing of the Certificate of Non-affiliation may not have been required by Air Force regulations in the particular circumstances, that the need for clearance may not have been immediate, or that the Department did not in fact rely upon the defendant's false statement to its injury. A false statement is submitted in a matter within the jurisdiction of a department or agency within the meaning of 18 U.S.C.A. § 1001 if it relates to a matter as to which the Department had the power to act. (footnotes omitted)

The transportation of gems into the United States is obviously a matter within the jurisdiction of Customs.

In United States v. Rose, 570 F.2d 1358 (9th Cir. 1978), a traveller failed to declare a dutiable item contained in the false bottom of a suitcase and gave false responses to a routine series of questions by the border agent. Affirming the conviction under 18 U.S.C. § 1001 based on these false responses, this court noted that

(a)lthough the statement in this case was oral, unsworn and unrelated to any monetary claim against the United States, the declarant was claiming the privilege of entry, and his statement potentially impaired the function of the Customs Service.

Although in this factual situation contraband was not allowed into the United States by (declarant's) statement, the statement had the "intrinsic" capability of bringing it about. 570 F.2d at 1364.

See also United States v. Leviton, 193 F.2d 848, 851 (2d Cir. 1951), Cert. denied, 343 U.S. 946, 72 S.Ct. 860, 96 L.Ed. 1350 (1952), where the court held that § 1001 should be broadly construed to apply to "false statements as might impede the 'exercise of federal authority.' " See generally United States v. Parten, 462 F.2d 430, 432 (5th Cir.), Cert. denied, 409 U.S. 983, 93 S.Ct. 325, 34 L.Ed.2d 248 (1972), where the court upheld convictions under § 1001 of two travellers Masters is correct in stating that the Customs form does not explicitly require that every item in a traveller's possession be declared. Nevertheless, the absence of such a requirement does not condone active concealment of a traveller's belongings. The traveller cannot be permitted to frustrate Customs' right to inspect all baggage and all merchandise brought into the United States.

re-entering the United States who had provided fictitious names. The court stated that Customs' declaration form was more than a "mere convenience."

On the evidence before it, the jury could reasonably infer that Masters' course of conduct, as described above, evidenced an awareness of the notice he denies receiving that Customs would consider material the passage of valuable gems into the United States. ⁸ His reliance on the notice requirement discussed by the Supreme Court in the context of a felon registration statute in Lambert v. California, 355 U.S. 225, 78 S.Ct. 240, 2 L.Ed.2d 228 (1957) is therefore inapposite. See generally United States v. Zavala, 139 F.2d 830, 832 (2d Cir. 1944), where the court noted in a case involving prosecution under 18 U.S.C. § 80, now § 1001, that evidence that the traveller's trunk had a false bottom would have been competent, had defendant objected, as bearing on his general intent to deceive the government.

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