U.S. v. Mobile Materials, Inc.

• Decision Date: 22 March 1989
• Docket Number: No. 86-1756,86-1756
• Citation: 871 F.2d 902
• Parties: , 1989-1 Trade Cases 68,487 UNITED STATES of America, Plaintiff-Appellee, v. MOBILE MATERIALS, INC. and Gerald O. Philpot, Defendants-Appellants.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 902

871 F.2d 902

57 USLW 2610, 1989-1 Trade Cases 68,487

UNITED STATES of America, Plaintiff-Appellee, v. MOBILE MATERIALS, INC. and Gerald O. Philpot, Defendants-Appellants.

No. 86-1756.

United States Court of Appeals Tenth Circuit.

March 22, 1989.

Mack Muratet Braly of Mack Muratet Braly & Associates, Tulsa, Okl., for defendants-appellants.

Andrea Limmer, Atty., Dept. of Justice, Washington, D.C. (Douglas H. Ginsburg, Asst. Atty. Gen., W. Stephen Cannon, Deputy Asst. Atty. Gen., and John J. Powers, III, Atty., Dept. of Justice, Washington, D.C., with her on the brief), for plaintiff-appellee.

Before McKAY, MOORE and BALDOCK, Circuit Judges.

PER CURIAM.

This case arose as one of several prosecutions in a campaign by the Justice Department to rid the Oklahoma and Kansas highway construction industry of anticompetitive bidding practices. In view of the issues on appeal, it will be helpful to recite the procedural history of the case in some detail.

On August 22, 1984, a grand jury sitting in the Western District of Oklahoma returned a seven-count indictment against Mobile Materials, Inc. (the Corporation), Mobile Materials Company (the Partnership), and Gerald O. Philpot, the president of both firms. Count one of the indictment charged all three defendants and unnamed co-conspirators with participation in a conspiracy to submit rigged bids to, or withhold bids from, the Oklahoma Department of Transportation and the Oklahoma Turnpike Authority in violation of section 1 of the Sherman Act, 15 U.S.C. Sec. 1 (1982). Counts two and three charged Mr. Philpot and the Corporation with making false, fictitious, and fraudulent statements to the United States Department of Transportation in violation of 18 U.S.C. Sec. 1001 (1982); and counts four through seven charged all three defendants with mail fraud under 18 U.S.C. Sec. 1341 (1982) in connection with the progress payments claimed from the state of Oklahoma.

Prior to trial, the defendants moved to dismiss the indictment on the ground that both the Corporation and the Partnership had been dissolved more than two years before the indictment was returned. The district court granted the motion as to the Corporation and the Partnership, finding its ruling compelled by our decision in United States v. Safeway Stores, 140 F.2d 834 (10th Cir.1944). The court declined to dismiss the criminal charges lodged against Mr. Philpot, however, reasoning that its order as to the Corporation and Partnership had no bearing on the allegations against him and no effect on the government's burden of proof. Rec. vol. I, doc. 37 at 4-5.

Subsequently, the government filed an interlocutory appeal under 18 U.S.C. Sec. 3731 (1982 & Supp. IV 1986) to contest the district court's dismissal of the indictment and moved for a continuance in the prosecution of Mr. Philpot under section 3161(h)(8) of the Speedy Trial Act, 18 U.S.C. Secs. 3161-3174 (1982 & Supp. II 1984). The district court granted the government's motion, concluding that "the ends of justice served by granting such a continuance outweigh the best interests of the public and the Defendant in a speedy trial." Rec. vol. I, doc. 49 at 1. The government's appeal was presented to us in the case of United States v. Mobile Materials, Inc., 776 F.2d 1476 (10th Cir.1985).

In Mobile Materials, we reversed the district court's ruling that under Oklahoma law a criminal prosecution cannot be maintained against a corporation that was dissolved before the return of the indictment. On December 9, 1985, we issued a mandate to the district court to conduct further proceedings in the prosecution of the three defendants consistent with that holding. As a first step in reactivating the prosecution, the district court held a status conference on January 9, 1986, in which it granted requests by both parties for permission to file motions and amended documents. Rec. vol. I, doc. 59.

Following an eight-day jury trial begun on March 3, 1986, the Partnership was acquitted of all charges. However, Mr. Philpot and the Corporation were convicted of the Sherman Act violation and one count of making false and fraudulent statements to the United States Department of Transportation. The district court sentenced Mr. Philpot to serve two concurrent three-year terms of imprisonment and to pay fines totaling $110,000. The court also imposed fines totaling $510,000 against the Corporation.

On appeal, Mr. Philpot and the Corporation (the appellants) raise four issues: (1) whether the case should have been submitted to the jury on a theory of a grand conspiracy to rig bids, (2) whether the Speedy Trial Act was violated by the protracted

length of the prosecution, (3) whether the trial judge's attitude and demeanor convinced the jury that the judge thought the appellants were guilty, and (4) whether the sentences were grossly disproportionate to others given for the same crimes and imposed without regard for the circumstances of the defendants.

Sufficiency of the Indictment

Under the general heading of the first issue presented, the appellants raise several arguments. We only consider the contention that the indictment is insufficient. ^{1 , 2} Appellants suggested below that count one failed to provide sufficient information to enable them to prepare a defense, contrary to the sixth amendment to the United States Constitution. They also argue that count one may be based on facts not presented to the grand jury, contrary to the fifth amendment.

The sufficiency of an indictment is judged by 1) whether the indictment contains the elements of the offense and apprises the defendant of the charges he must meet and 2) whether the defendant would be protected against double jeopardy by a judgment on the indictment. Hamling v. United States, 418 U.S. 87, 117, 94 S.Ct. 2887, 2907, 41 L.Ed.2d 590 (1974). Appellants' real complaint about count one of the indictment is that its breadth allowed the introduction of co-conspirator testimony and allowed the jury to consider evidence of a single conspiracy to rig bids, of which the appellants were a part. Appellants' Brief In Chief at 12-14 (citing United States v. Heath, 580 F.2d 1011, 1026 (10th Cir.1978) (McKay, J., dissenting), cert. denied, 439 U.S. 1075, 99 S.Ct. 850, 59 L.Ed.2d 42 (1979)). Indeed, appellants have challenged the admissibility of co-conspirator statements and the sufficiency of the evidence to support a single conspiracy, but have not provided us with those portions of the transcript needed for our review. See, e.g., United States v. Washita Constr. Co., 789 F.2d 809, 821-22 (10th Cir.1986) (court reviewed trial testimony and judge's findings in rejecting defendants' claims that co-conspirator hearsay admitted improperly). We decline to consider these issues in the absence of a record containing those portions of the transcript on which the parties rely. ³ United States v. Tedder, 787 F.2d 540, 542 n. 2 (10th Cir.1986); United States v. Strand, 617 F.2d 571, 577 (10th Cir.), cert. denied, 449 U.S. 841, 101 S.Ct. 120, 66 L.Ed.2d 48 (1980); Rachbach v. Cogswell, 547 F.2d 502, 504 (10th Cir.1977).

Turning to the sufficiency of the indictment, the entire document may be 15 U.S.C. Sec. 1 provides that contracts, combinations and conspiracies in restraint of trade are illegal. Tracking the statutory language, paragraph 14 of the indictment charged that "the defendants and co-conspirators engaged in a combination and conspiracy in unreasonable restraint of trade and commerce" from July 1978, through February 1982. Rec. vol. I, doc. 1 at 7. Paragraph 9 of the indictment explains the sealed competitive bidding process used by the Oklahoma Department of Transportation and Oklahoma Turnpike Authority. Id. at 4-5. Highway construction contracts are awarded to the lowest responsible bidder following the opening of sealed bids. Id. Paragrah 15 of the indictment charges that a substantial term of the conspiracy "was to submit collusive, noncompetitive, and rigged bids to, or withhold bids from, the Oklahoma Department of Transportation and the Oklahoma Turnpike Authority for the award of highway construction projects in Oklahoma." Id. at 7. Paragraph 16 outlines the practices in furtherance of the conspiracy allegedly engaged in by the appellants and other conspirators including: 1) discussing the submission of prospective bids on projects, 2) agreeing on the successful low bidder on projects, 3) submitting intentionally high, noncompetitive bids or withholding bids on construction projects and 4) submitting bid proposals with false statements and entries. Id. at 8. Paragraph 17 spells out the anticompetitive effects of the conspiracy, primarily the lessening of price competition.

                considered.  United States v. Metropolitan Enter., Inc., 728 F.2d 444, 452-53 (10th Cir.1984).  For purposes of testing the sufficiency of the indictment, the essential elements of a conspiracy under Secs. 1 & 2 of the Sherman Act are "time, place, manner, means and effect."    United States v. Greater Kansas City Retail Coal Merchants' Ass'n, 85 F.Supp. 503, 508 (W.D.Mo.1949).  In this case, the paragraphs preceding count one and count one itself establish these elements
                

The indictment charges the appellants with a bid-rigging conspiracy in the award of highway projects during a 43-month period, from July 1978 through February 1982. Thus, the time element is satisfied. The conspiracy is alleged to have existed in the Western District of Oklahoma. Rec. vol. I, doc. 1 at 9. Thus, the place element is satisfied. The indictment specifies the manner and means of the conspiracy. There was advance agreement as to which co-conspirator would be the low bidder on highway construction projects. With this object in mind, some noncompetitive bids were submitted, and some bids were withheld. The indictment also specified the effect of this practice, a lessening of price competition in the highway construction industry. This indictment has "more...