U.S. v. Weiner

Decision Date15 May 1978
Docket NumberNo. 75-2973,75-2973
Citation578 F.2d 757
PartiesFed. Sec. L. Rep. P 96,541 UNITED STATES of America, Appellee, v. Julian S. H. WEINER, Marvin Al Lichtig and Solomon Block, Appellants.
CourtU.S. Court of Appeals — Ninth Circuit

Nathan Markowitz (argued), of Sands & Markowitz, Beverly Hills, Cal., Richard A. DeSantis (argued), Los Angeles, Cal., Gerry L. Ensley (argued), Beverly Hills, Cal., for appellants.

William J. Rathje, Asst. U. S. Atty. (argued), Los Angeles, Cal., for appellee.

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

Before CHOY and GOODWIN, Circuit Judges, and THOMPSON, * District Judge.


Julian Weiner, Marvin Lichtig, and Solomon Block appeal their respective convictions for securities fraud arising out of their employment as auditors of Equity Funding Corporation of America (Equity Funding) during the time covered by the indictment.

Equity Funding was incorporated in 1960 to sell life insurance, mutual funds, and "equity funding" programs. 1 The company operated legitimately and profitably until 1964, when, the government proved, it began to publish inaccurate and false financial statements. Equity Funding was accused of massive fraud in overstating its income and claiming nonexistent assets in order to increase the market value of its stock.

Wolfson, Weiner, Ratoff, and Lapin were the independent public accountants for Equity Funding from 1961 until 1971. In early 1972, the Los Angeles branch of the Wolfson, Weiner firm joined with the accounting firm of Seidman & Seidman. The combined firm served as Equity Funding's independent public accountant until the exposure of the fraud in 1973.

Julian Weiner was the Wolfson, Weiner partner in charge of the audits of Equity Funding from 1961 to 1973. He was convicted of six counts of securities fraud, 15 U.S.C. §§ 77x, 77q(a), for accounting practices which fraudulently overstated the income and assets of Equity Funding, and of four counts of willfully making untrue statements to the Securities Exchange Commission (SEC) and the New York or Pacific Coast Stock Exchanges, in violation of 15 U.S.C. §§ 77x, 77f, 78ff, 78m.

Marvin Lichtig, as an employee and later as a junior partner of Wolfson, Weiner, supervised the audit field work of Equity Funding for the audits between 1963 and 1968. He reported directly to Julian Weiner. From 1968 until 1973, Lichtig served as an officer of Equity Funding and signed registration statements as the principal accounting officer of the company. Lichtig was convicted of the same six counts of securities fraud as Weiner. Lichtig was also convicted of seven counts of filing false statements with the SEC and the New York or Pacific Coast Stock Exchange in violation of 15 U.S.C. §§ 77x, 77f, 78ff, 78l, 78m.

Solomon Block was employed by Wolfson, Weiner in 1968 and replaced Lichtig as the supervisor of field audits. Block served as supervisor for the 1969 through 1972 audits. Block was charged with the same six counts of securities fraud as Weiner and Lichtig, but Block was convicted of only five of the counts. Block was convicted of two counts of making false statements to the SEC and the New York or Pacific Coast Stock Exchanges in violation of 15 U.S.C. §§ 77x, 77f, 78ff, 78m.


Defendants argue that the convictions must be reversed because the jury verdict was not unanimous. This challenge is based on juror affidavits.

The jury returned a verdict of guilty, and each member of the panel was polled. The judge asked "please indicate by answering if the verdicts just read are your verdicts," and each juror responded individually in the affirmative. The verdicts were received and the jury was discharged. Half an hour later, a juror went to the judge's chambers and said that she had never voted "guilty", but rather had voted "guilty with reservation" during the jury's deliberations. She further stated that she understood that the jury's verdict was eleven "guilty" and one "guilty with reservation", and was confused by the events in the courtroom when she responded affirmatively that the verdict rendered was her verdict. Two other jurors made affidavits to support this juror's statement that she had always qualified her "guilty" vote "with reservation".

The defendants moved for a new trial, based on the affidavits of the three jurors. The district judge denied the motion, holding that the affidavits were not admissible to impeach the verdicts.

The district court followed established law. Jurors may not impeach their own verdict. McDonald v. Pless, 238 U.S. 264, 35 S.Ct. 783, 59 L.Ed. 1300 (1915). This rule, with narrow exceptions, is codified in Fed.R.Evid. 606(b).

Defendants argue that they are not seeking to impeach the verdict. They contend that the verdict rendered in court was not the true verdict of the jury and the affidavits should be admissible to prove this fact. They cite Fox v. United States, 417 F.2d 84 (5th Cir. 1969). In that case, a juror remained silent when polled, and other jurors by affidavit said they thought a verdict by a majority was sufficient. The court held that there was no legal verdict. But here there was a verdict, and upon a poll of each juror in open court it was unanimous. Even if the defendants were able to prove that one juror had consistently voted "guilty with reservation", the only purpose of such testimony would be to impeach the verdict. The meaning of "with reservation" would thus be left to the ingenuity of counsel and the vagaries of social behavior in every case.

The juror answered in the affirmative when asked if "guilty" was her verdict. Many jurors have some second thoughts about their verdicts. "Beyond a reasonable doubt" need not exclude all doubt. To permit this juror to contradict this verdict by an explanation that her vote was "guilty with reservation" would sanction the impeachment of any verdict in which a juror could be found who was willing to repudiate the answer he gave when polled. 2 Opportunities for harassment of jurors and jury tampering would abound. Such a burden on the jury system could not long be tolerated.


The defendants also argue that the jury was coerced by the giving of the Allen charge. 3 After 5 days of deliberations, the foreman of the jury notified the judge that "one of the members of our jury feels unable to participate in deliberations with the rest of us." After ascertaining that the juror was not suffering from a physical or mental disability, the judge gave a modified Allen instruction substantially as set out in E. Devitt & C. Blackmar, Federal Jury Practice and Instructions § 17.18 (2d ed., 1970). (This instruction is § 18.14 in the Third Edition, 1977.)

This court has consistently upheld this form of the Allen charge. Sullivan v United States, 414 F.2d 714 (9th Cir. 1969). The cases which discuss the assumed effect of the Allen charge are all appealed by defendants who were convicted. Defendants who have been acquitted after the giving of the charge have not complained. Upon review of all the circumstances of the case, we hold that the supplemental instruction was not coercive. 4


During the trial, the prosecutor learned that two jurors had been on an elevator during a conversation between a government attorney and a government witness. The prosecutor notified the trial judge, who called a conference in chambers with all parties to the conversation plus defense counsel. The judge determined that nothing prejudicial had been said. There was no motion for a mistrial. Defense counsel now assert that there was something sinister about the event. The record, however, reveals no reason for disturbing the trial court's discretion in handling the matter.

The same juror who had expressed her reservations in the jury room and later in a posttrial affidavit also stated in her affidavit that during the deliberations she had initiated a conversation with the bailiff by asking whether the judge expected a verdict. She said the bailiff told her that he didn't know, but he assumed that the judge would "like" a verdict. The bailiff, by affidavit, denied the conversation. In any event, the defendants fail to show how such a conversation, if it occurred, could have prejudiced anyone. Since the alleged conversation occurred, if it occurred at all, nearly a week after the judge had given the Allen charge earlier complained of, it should have been apparent to even the most obtuse juror that a verdict would be a welcomed development. We find no basis for charging the trial judge with an abuse of discretion for refusing to grant a new trial upon this sort of clutching at straws. It was a long trial, and such trials frequently produce a number of imperfections. It is to the credit of the experienced trial judge that this is the sort of assignment of error to which the appellants apparently must look in their search for reversible error.


Appellant Lichtig claims that the prosecutor made an impermissible reference in final argument to his and Block's failure to take the stand. Block's attorney, in his part of the summation, had made a reference to certain evidence thought to be exculpatory of Block. The prosecutor in his final argument referred to "Julian Weiner's exculpatory testimony" and the absence of other testimony on the point. None of these comments trespassed upon the rule against calling attention to failure to testify. The jury knew very well that neither Block nor Lichtig had testified, and, if this failure left some unanswered questions in the minds of jurors, that was a risk that had been assumed long before final argument. The government took no unfair advantage of the situation, and there was no error in refusing a new trial on this score. The trial court carefully instructed the jury about the...

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