U.S. v. Short

• Decision Date: 23 March 1982
• Docket Number: No. 80-3784,80-3784
• Citation: 671 F.2d 178
• Parties: 109 L.R.R.M. (BNA) 3107, 93 Lab.Cas. P 13,273 UNITED STATES of America, Plaintiff-Appellant, v. Adrian J. SHORT, Jr.; Earl L. Riedel, Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 178

671 F.2d 178

109 L.R.R.M. (BNA) 3107, 93 Lab.Cas. P 13,273

UNITED STATES of America, Plaintiff-Appellant, v. Adrian J. SHORT, Jr.; Earl L. Riedel, Defendants-Appellees.

No. 80-3784.

United States Court of Appeals Sixth Circuit.

Argued Dec. 18, 1981.

Decided Feb. 11, 1982.

Rehearing and Rehearing En Banc Denied March 23, 1982.

John Sopko, Justice Dept., Organized Crime Strike Force, Cleveland, Ohio, Kate Pressman (Lead counsel), Appellate Sec., William C. Bryson, Chief, Appellate Sec. Cr. Div., Dept. of Justice, Washington, D. C., for plaintiff-appellant.

Robert J. Rotatori, Cleveland, Ohio, for Short.

Stewart I. Mandel, McCarthy, Lebit, Crystal, Kleinman & Gibbons, Cleveland, Ohio, for Riedel.

Before LIVELY, BROWN and MARTIN, Circuit Judges.

LIVELY, Circuit Judge.

The government appeals from two orders of the district court which, together, dismissed all charges against the defendants-appellees. Short has been the business agent for many years of two Cleveland unions, Locals 27 and 209 of the International Alliance of Theatrical Stage Employees, and Riedel has been secretary-treasurer of both. Count 1 of the indictment charged the defendants with conspiring to appropriate funds from the two local unions for their own use in violation of 18 U.S.C. § 371. The remaining 24 counts charged them with substantive violations of 29 U.S.C. § 501(c) ¹ and 18 U.S.C. § 2 by accepting unlawful expense payments and reimbursements from the unions. Short was charged as a principal and Riedel as an aider and abetter. We reverse and remand for further proceedings.

I.

The defendants made separate motions for disclosure or, in the alternative, for the court to conduct an in camera inspection of portions of the transcript of proceedings of the special grand jury which indicted them. Short's motion was based on the assertion that some of the testimony before the grand jury was exculpatory in nature, that the prosecutor had failed to instruct the grand jury properly on the elements of the offense set forth in 29 U.S.C. § 501(c), and that this failure was of such magnitude as to require dismissal of the indictment. This motion was denied. Riedel's motion was based on claimed misconduct of the prosecutor. He alleged that at his first two appearances before the grand jury-on April 9, 1979 and June 12, 1979-he was advised by the prosecuting attorney that he was not a target of the grand jury's investigation. When he was called before the grand jury on September 24, 1979, Riedel received no advice that he was not a target of the investigation. He was subsequently indicted on 25 counts, and contended that the prosecutor had abused his discretion and manipulated the grand jury to return the indictment. Riedel maintained that the grand jury had all the information which formed the basis of the indictment by June 12th, when the prosecutor was still assuring him that he was not a target.

The district court examined the grand jury transcript of proceedings and concluded there was competent evidence to support Counts 2 through 25 (the substantive charges) and found no indication that the grand jury had been manipulated. In an oral ruling the district court expressed doubt that there was any evidence in the record to support all the elements of Count 1, the conspiracy count. The court ordered disclosure of the entire grand jury transcript pursuant to Rule 6(e), Federal Rules of Criminal Procedure, and deferred final ruling on dismissal of Count 1.

Following briefing by the parties the district court entered a memorandum and order on the government's motion for reconsideration of its oral ruling. The district court reaffirmed its order of disclosure limited, however, to the testimony of members and employees of the two locals and an officer of the international union, 12 witnesses in all. In ordering disclosure, the court relied heavily on the policy of "openness in union affairs" contained in the Labor-Management Reporting and Disclosure Act of 1969 (LMRDA) of which 29 U.S.C. § 501(c) is a part. The court recognized the longstanding policy of secrecy of grand jury proceedings, but reasoned that the opposing policy of openness in union affairs "injects a relaxant" into the usual requirement that the need for disclosure be shown with particularity. The court stated that union members and employees who testify before a grand jury should expect their testimony to be made public in view of the openness requirements of the LMRDA, and that such witnesses "do not fit the mold" of those who would refuse to testify if they knew their testimony would not remain secret. Finding that some of the testimony of union members and a union employee may be exculpatory, the court ordered the entire transcript of testimony of these witnesses disclosed to the defendants.

Turning to Count 1, the court stated that it had decided sua sponte to dismiss the conspiracy charge. In doing so, the court noted that a conspiracy conviction requires something more than the joint action required to prove aiding and abetting-the additional element of "preconcert and connivance." Based on its examination of the entire grand jury record, the district court concluded that "(n)either direct nor circumstantial proof exists in the record of any agreement to accomplish a violation of section 501(c)." Count 1 was dismissed with prejudice. The government advised the court that it would decline to comply with the order of disclosure. The court then dismissed Counts 2 through 25 without prejudice, and this appeal followed.

II.

The district court relied on United States v. Tane, 329 F.2d 848 (2d Cir. 1964), and Coppedge v. United States, 311 F.2d 128 (D.C.Cir.1962), cert. denied, 373 U.S. 946, 83 S.Ct. 1541, 10 L.Ed.2d 701 (1963), in dismissing Count 1 with prejudice. In Tane an indictment was dismissed where the only evidence before the grand jury had been obtained by illegal wiretapping and the government conceded that dismissal was proper if this evidence could not be used. The court of appeals stated:

A defendant has no right to have an indictment dismissed merely because incompetent or inadequate evidence was presented to the Grand Jury. Lawn v. United States, 355 U.S. 339, 78 S.Ct. 311, 2 L.Ed.2d 321 (1958); Costello v. United States, 350 U.S. 359, 76 S.Ct. 406, 100 L.Ed. 397 (1956). But a motion to dismiss or quash an indictment because of the absence or incompetency of evidence before the Grand Jury is addressed to the discretion of the trial court, and the decision to grant or deny the motion will not be reversed unless there has been an abuse of that discretion. Carrado v. United States, 93 U.S.App.D.C. 183, 210 F.2d 712, 717 (D.C.Cir.1953), cert. denied 347 U.S. 1018, 74 S.Ct. 874, 98 L.Ed. 1140 (1954); Stewart v. United States, 300 F. 769, 777 (8 Cir. 1924). As long as there is some competent evidence to sustain the charge issued by the Grand Jury, an indictment should not be dismissed.

329 F.2d at 853-54 (footnote and citation omitted). In Coppedge the trial court denied a motion to dismiss an indictment on the ground that it was procured by fraud through the perjured testimony of one witness. In affirming, the court of appeals stated, "It is enough ... that there is some competent evidence to sustain the charge issued by the Grand Jury even though other evidence before it is incompetent or irrelevant in an evidentiary sense or even false." 311 F.2d at 132 (emphasis in original).

As we have noted, the government conceded that the indictment in Tane should be dismissed. The dicta in Tane and the use of the word "some" in both opinions support the conclusion that an indictment based on no evidence should be dismissed. However, the Supreme Court has never formulated such a rule. The leading case on the evidentiary requirements for a valid indictment is Costello v. United States, 350 U.S. 359, 76 S.Ct. 406, 100 L.Ed. 397 (1956). Costello held that a defendant in a criminal case is not entitled to have an indictment quashed on the ground that all the evidence presented to the grand jury was hearsay. After reviewing the history and function of grand juries, Justice Black wrote for the Court:

If indictments were to be held open to challenge on the ground that there was inadequate or incompetent evidence before the grand jury, the resulting delay would be great indeed. The result of such a rule would be that before trial on the merits a defendant could always insist on a kind of preliminary trial to determine the competency and adequacy of the evidence before the grand jury. This is not required by the Fifth Amendment. An indictment returned by a legally constituted and unbiased grand jury, like an information drawn by the prosecutor, if valid on its face, is enough to call for trial of the charge on the merits. The Fifth Amendment requires nothing more.

350 U.S. at 363, 76 S.Ct. at 408 (footnote omitted).

In two subsequent cases the Supreme Court repeated its Costello language. In Lawn v. United States, 355 U.S. 339, 78 S.Ct. 311, 2 L.Ed.2d 321 (1958), the Supreme Court upheld a trial court's refusal to conduct a preliminary hearing to determine whether an indictment was based either directly or indirectly on tainted evidence. In United States v. Calandra, 414 U.S. 338, 94 S.Ct. 613, 38 L.Ed.2d 561 (1974), the Court held that a witness before a grand jury could not refuse to answer questions on the ground that they were based on evidence derived from an unlawful search and seizure. In so holding, the Court relied on Costello. This court has consistently given the Costello language a literal reading: "An indictment returned by a legally constituted and unbiased grand jury ... if valid on its face, is enough to call for trial of the charge on the merits." 350 U.S. at 363, 76 S.Ct. at 408. See United States v. Barone, 584 F.2d 118 (6th Cir. 1978), cert. denied, 439 U.S. 1115, 99 S.Ct. 1019, 59 L.Ed.2d 73 (1979); United States v. Ruyle, 524 F.2d 1133 (6th...