U.S. v. Nell

• Decision Date: 07 April 1978
• Docket Number: No. 77-5117,77-5117
• Citation: 570 F.2d 1251
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Richard NELL, Defendant-Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 1251

570 F.2d 1251

UNITED STATES of America, Plaintiff-Appellee, v. Richard NELL, Defendant-Appellant.

No. 77-5117.

United States Court of Appeals Fifth Circuit.

April 7, 1978.

P. D. Aiken, Fort Lauderdale, Fla., for defendant-appellant.

J. V. Eskenazi, U. S. Atty., Miami, Fla., William C. Brown, Atty., U. S. Dept. of Justice, T. George Gilinsky, Michael W. Farrell, Washington, D. C., for plaintiff-appellee.

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

Before WISDOM and GEE, Circuit Judges, and VAN PELT, ^* District judge.

VAN PELT, Senior District Judge:

Richard Nell, former president of the International Union of Operating Engineers, Local 675, appeals his conviction by a jury on sixteen counts contained in two separate indictments relating to:

1) embezzlement and conversion of union funds by a union officer (in violation of 29 U.S.C. § 501(c));

2) racketeering (18 U.S.C. § 1961);

3) extortion (18 U.S.C. § 1951);

4) demanding, receiving and accepting money as a union official from employers (29 U.S.C. § 186); and

5) wilfully making false statements on his income tax returns for the years 1971 through 1974 (26 U.S.C. § 7206(1)).

Several of the issues raised on this appeal stem from the fact that this trial involved the consolidation of the two indictments. For simplicity, we will refer to them as Indictment 1 and Indictment 2.

Indictment 1 was originally filed July 24, 1974, and charged Nell in seven counts with embezzlement or conversion to his own use of union funds. Indictment 1 was tried in October of 1974. Nell was convicted by a jury on five counts, the court having granted an acquittal as to two counts prior to submission to the jury. The conviction was overturned on appeal to this Circuit. United States v. Nell, 526 F.2d 1223 (5th Cir. 1976). The panel found the evidence sufficient to support each of the embezzlement convictions, but found reversible error in the selection of the jury. After denial of a rehearing, the mandate of this court issued April 15, and was filed with the district court on April 19, 1976. Indictment 1, by order of the clerk dated April 20 and filed April 21, was set for criminal jury trial for June 1, 1976 "or as soon thereafter as the case may be heard," with the notation on the order that a calendar call would be held June 1, 1976 at 9 a. m. R. Vol. 2, at 272. On May 5, 1976 Indictment 2, charging Nell with thirteen new counts ¹ relating to racketeering, extortion, and false statements on tax returns, was returned by the grand jury and filed with the clerk of the district court. The two indictments were assigned to different judges. The United States, on May 5, and defendant, on May 11, filed motions for consolidation. Defendant's motion was denied. The government on May 21 filed a motion to reconsider consolidation and thereafter consolidation was ordered.

On appeal, Nell contends that:

1) The trial court erred in failing to dismiss Indictment 2 claiming that appellant had been penalized for successfully appealing his conviction under Indictment 1;

2) The sentence imposed on appellant under counts 6 and 7 of Indictment 1 is illegal because it constitutes a more severe sentence on retrial after a successful appeal;

3) The evidence was insufficient to convict him and the trial court erred in denying his motion for judgment of acquittal on the following counts:

a) Counts 8 through 11 of Indictment 2 relating to wilfully making and subscribing false tax returns for the years 1971 through 1974 because venue was not established;

b) Count 2 of Indictment 1 relating to expenditure of union funds for personal legal fees incurred in erasing a 1932 criminal conviction;

c) Counts 2, 4, and 6 of Indictment 2 relating to separate acts of extorting money from three contractors because the necessary elements of extortion were not shown;

4) The trial court erred in allowing appellant's testimony to be read from the original 1974 trial under Indictment 1 and that the trial court abused its discretion by failing to grant severance.

We affirm.

I. THE SECOND INDICTMENT

Relying on North Carolina v. Pearce, 395 U.S. 711, 89 S.Ct. 2072, 23 L.Ed.2d 656 (1969) and Blackledge v. Perry, 417 U.S. 21, 94 S.Ct. 2098, 40 L.Ed.2d 628 (1974), appellant alleges that the filing of Indictment 2, after his successful appeal from the 1974 trial on Indictment 1, shows prosecutorial vindictiveness. Appellant contends that the government "upped the ante" by charging him with new counts carrying a stiffer penalty based on "all of the very same acts charged in the first case." Appellant's brief at 16. Blackledge, supra, held that, after a person convicted of a misdemeanor filed an appeal for a trial de novo, the state could not file another indictment charging the same criminal act as a felony because it violated the Due Process Clause of the Fourteenth Amendment. The Supreme Court reached this result even though there was no evidence of bad faith on the part of the prosecutor.

It is true that some (but not all) of the counts in the second indictment reiterated the embezzlement acts charged in the first indictment. Count 1 of the second indictment alleged a pattern of racketeering on the part of appellant and listed the same five acts of embezzlement for which appellant was convicted under Indictment 1 and on which he was retried and again found guilty. ² However, in addition, the racketeering count alleged eight new acts of extortion and receipt of moneys as a union official. Counts 8 through 11 of Indictment 2 concerned false statements on income tax returns. The embezzlement acts from Indictment 1 were an integral part of these tax counts because appellant had received moneys from the union which he had not reported as income. However, the income tax counts also relied upon evidence that Nell had received extortion money from contractors which he never reported as income. Thus, all of the 13 counts in the second indictment had an additional factual basis not found in Indictment 1.

Blackledge indicated there would be nothing improper with a later filing of increased charges if the state prosecutor had shown that it was impossible to proceed on the more serious charge right from the beginning. Id. at 29, n. 7, 94 S.Ct. 2098. This was recently explored in Hardwick v. Doolittle, 558 F.2d 292 (5th Cir. 1977), cert. denied, --- U.S. ----, 98 S.Ct. 897, 54 L.Ed.2d 801 (1978), where it was stated:

An increase in the severity or number of charges if done without vindictiveness may be easily explained. For example, evidence of the additional crimes may not have been obtained until after the first indictment or information is filed, or the additional crime may not be complete at the time charges are first brought. And a prosecutor may, without explanation, refile charges against a defendant whose bargained-for guilty plea to a lesser charge has been withdrawn or overturned on appeal, provided that an increase in the charges is within the limits set by the original indictment. Other explanations which would negate vindictiveness could include mistake or oversight in the initial action, a different approach to prosecutorial duty by the successor prosecutor, or public demand for prosecution on the additional crimes allegedly committed. The list is intended to be illustrative rather than exhaustive. While Hardwick has made a prima facie case by showing that the number of crimes charged against him as a result of this episode was doubled after he had succeeded in setting aside the original convictions, the prosecutor may rebut this prima facie proof by establishing his reasons for adding the two new charges were other than to punish a pesky defendant for exercising his legal rights.

Id. at 301 (footnotes omitted).

Nell was still under investigation for other crimes when the first indictment was filed. Nell was aware that he faced additional charges. Prior to the 1974 trial, Nell filed a Motion to Quash Internal Revenue Service Administrative Summons/Motion for Temporary Restraining Order/Motion for Protective Order. This motion alleged that a witness whom Nell planned to use in his criminal trial had been served an Internal Revenue summons. The motion further stated that the information sought by the Internal Revenue Service related to the same items that were in the criminal indictment and that a request had been made to the I.R.S. to stay the tax investigation until after the criminal case had been tried. R. Vol. 2, at 17. Defense counsel later filed a Motion to Withdraw the above motion, explaining that the matter had been satisfactorily resolved with the I.R.S. Thus, it is clear that the government continued its attempt to obtain information relating to the tax counts after the first indictment was originally filed. It is also clear that the government was pursuing the evidence of extortion, which was a basis for all 13 counts of the second indictment, long after the first indictment was returned. In preparation of the second indictment, statements were taken from witnesses from July 10, 1974 through April 26, 1976. Indictment 2 was returned May 5, 1976. It grew out of an extensive investigation which was started long before Nell took his appeal from the 1974 trial. Therefore, although Nell made a prima facie case by showing the second indictment was filed soon after the notice of retrial and included the identical acts in some counts, we conclude the government has adequately shown valid reasons for the delay in filing Indictment 2. We find no error in failing to dismiss the second indictment.

II. SENTENCING UPON RETRIAL ³

Under Pearce, supra, a judge may impose a more severe sentence after a new trial if the reasons for doing so affirmatively appear. The reasons must be based on "objective information concerning identifiable conduct on the part of the defendant occurring after the time of the original sentencing proceeding." Id. 395 U.S. at 726, 89 S.Ct. at...