U.S. v. Wilson, s. 78-1829

• Citation: 601 F.2d 95
• Decision Date: 18 June 1979
• Docket Number: 78-1867,Nos. 78-1829,79-1014 and 79-1015,s. 78-1829
• Parties: 79-2 USTC P 9730 UNITED STATES of America, Appellee, v. Thomas WILSON and John MacGregor, Appellants.
• Court: United States Courts of Appeals. United States Court of Appeals (3rd Circuit)

Page 95

601 F.2d 95

79-2 USTC P 9730

UNITED STATES of America, Appellee, v. Thomas WILSON and John MacGregor, Appellants.

Nos. 78-1829, 78-1867, 79-1014 and 79-1015.

United States Court of Appeals Third Circuit.

Argued April 30, 1979.

Decided June 18, 1979.

Joel Harvey Slomsky and Edward Reif, Philadelphia, Pa., for appellants.

Peter F. Vaira, U. S. Atty., Philadelphia, Pa., Michael J. Keane, Barry A. Friedman, Dept. of Justice, Washington, D. C., Robert E. Courtney, III, Special Atty., Philadelphia Strike Force, Philadelphia, Pa., for appellee.

Before ADAMS, GIBBONS and WEIS, Circuit Judges.

OPINION OF THE COURT

WEIS, Circuit Judge.

In this criminal case, the defendants' request for a deposition of a potentially crucial witness in a foreign country was denied primarily because he was a fugitive. We conclude that fact does not make the witness incompetent to testify and should be considered only in assessing the weight of the testimony. The denial of the deposition combined with the trial judge's misgivings about the credibility of an essential prosecution witness convince us that the convictions should be vacated and a new trial granted to the defendants.

Defendants were convicted on a number of counts of conspiracy to possess Pennsylvania Public Assistance checks stolen from the United States mails, 18 U.S.C. §§ 371, 1708, and of preparing false corporate income tax returns, 26 U.S.C. § 7206(1). In addition, defendant MacGregor was convicted under 18 U.S.C. § 1708 of possessing two of the stolen checks. The defendants were sentenced to a year and a day imprisonment, five years probation, and fines of $20,000 each. Appeal was taken from convictions obtained in a second trial, the first having ended in a mistrial after the jury had acquitted on some counts but was unable to reach verdicts on others.

Wilson and MacGregor were principals in two check-cashing agencies located in Philadelphia and organized as JATO Corporation. The government maintained that during the period from February 1972 until August 1973, JATO purchased 842 stolen public assistance checks and, in addition, sold 1,807 stolen checks to Arrow Enterprises, another Philadelphia check-cashing firm. The prosecution's chief witness was Anthony Macchia who testified that JATO made a profit of 39.5% Of the face value of each check purchased and cashed. In addition, he said that Arrow paid the face value of checks it received from the defendant agencies. In the early days of their relationship, the defendants delivered checks to Arrow already endorsed. Later, however, Macchia and others affiliated with Arrow forged the endorsements.

Proof of mailing of the checks was supplied by a state official who described the procedures used to send the checks to assistance recipients. Witnesses entitled to public assistance testified that certain checks addressed to them had not been received and other evidence showed that they had been deposited by either JATO or Arrow.

The government relied on the number of checks and Macchia's description of the profits to calculate the deficiency in JATO's reported taxable income. The indictment alleged the unreported income for 1972 to be $87,875, and $16,941 for 1973. However, on cross-examination Macchia changed his testimony to such an extent that substantial doubt was cast upon the accuracy of the calculations in the indictment. After this turn of events, the government called a revenue agent who submitted alternative computations to the jury using various interpretations of Macchia's testimony. Based on these alternatives, the prosecution contended that JATO's unreported income in 1972 was either $73,848, $34,512, or the indictment figure of $87,875. Similarly, the 1973 figures could have been $16,941, as set out in the indictment, or $15,146.

During the trial, the district judge expressed concern over Macchia's truthfulness, saying at one point that the witness "was devoid of credibility." The judge conveyed his misgivings to the Assistant United States Attorney and asked that he discuss the matter with his superiors. Defendants sought a new trial after the guilty verdicts were returned, but their motions were denied from the bench. Citing precedent that credibility of witnesses was for the jury, the trial judge noted that by the end of the trial there had been corroboration of Macchia's testimony to some degree. In addition, the court ruled that other grounds, including the refusal to allow defendants to take the deposition of David Cardonick, were without merit.

Cardonick, the real force behind the Arrow Company, was another principal figure in the check-cashing scheme. He founded the Arrow Company and later brought Macchia into it. After being convicted in a state court for cigarette tax violations, Cardonick fled to Spain on April 22, 1972 and was still there when this case was first listed for trial.

Six days before the scheduled trial date, the defendants presented a petition to authorize Cardonick's deposition in Spain. Attached to the petition was Cardonick's affidavit asserting that he had come upon "a political deal" to make money by purchasing stolen welfare checks and that the owners of JATO had no knowledge that some of the checks they cashed had been obtained through this "political deal." The petition asserted that Cardonick refused to return from Spain but that he was willing to be deposed there. In response, the prosecutor asked that if a deposition were ordered, the case be continued for a week.

The district judge denied the petition, partially on the basis of the imminence of trial, but primarily because the witness was a fugitive. No renewed motion for the deposition was presented between the first and second trials.

After the filing of this appeal, Cardonick returned to the United States to serve his state sentence, and the defendants promptly filed a motion for a new trial based on newly discovered evidence. They submitted an affidavit from Cardonick stating that he had returned to help the defendants who, in his opinion, had been wrongfully convicted. The affidavit set out in some detail the operation of the check-cashing scheme and repeated that the defendants had no knowledge that some of the checks had been stolen. After argument, the court denied the petition, concluding that the defendants had failed to meet the requirements set out in United States v. Iannelli, 528 F.2d 1290 (3d Cir. 1976), for the grant of a new trial based on newly discovered evidence.

We turn first to the district court's refusal to permit the deposition of Cardonick. Although untimeliness of the request was undoubtedly a factor in the denial, it seems that the overriding consideration was that Cardonick was then a fugitive. Defense counsel's belief that it would be futile to reapply before the second trial appears reasonable under these circumstances and we accept counsel's representation to that effect.

Federal Rule of Criminal Procedure 15(a) provides that in exceptional circumstances the court may upon motion order that a deposition of a prospective witness be taken when it is in the interest of justice to do so. ¹ Attendance of witnesses at trial, however, is the favored method of presenting testimony, and primarily for this reason depositions are not favored in criminal cases. The antipathy to depositions is due in large part to the desirability of having the factfinder observe witness demeanor. Although this concern has been alleviated to a marked degree by the advent of modern audio-visual technology, the policy in favor of having the witness personally present persists. Rule 15 entrusts broad discretion to the trial judge, but if in its exercise a ruling is based upon an erroneous legal premise, the scope of our review is expanded. Fuentes v. Reilly, 590 F.2d 509, 513-14 (3d Cir. 1979).

When the petition for deposition was presented to the court, Cardonick was in a country that had refused to extradite him because the offense for which he had been convicted did not come within the applicable extradition treaty. At that time, therefore, it was doubtful that he would return to the United States for the trial. His affidavit established that his testimony was relevant and, if believed, would have been exculpatory to some extent. A sufficient showing, therefore, had been made to justify the taking of a deposition.

In his bench opinion, the trial judge cited United States v. Murray,...