U.S. v. Young Bros., Inc.

• Decision Date: 19 March 1984
• Docket Number: No. 83-1174,83-1174
• Citation: 728 F.2d 682
• Parties: 1984-1 Trade Cases 65,925, 15 Fed. R. Evid. Serv. 484 UNITED STATES of America, Plaintiff-Appellee, v. YOUNG BROTHERS, INC., Contractors, Defendant-Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 682

728 F.2d 682

1984-1 Trade Cases 65,925, 15 Fed. R. Evid. Serv. 484

UNITED STATES of America, Plaintiff-Appellee, v. YOUNG BROTHERS, INC., Contractors, Defendant-Appellant.

No. 83-1174.

United States Court of Appeals Fifth Circuit.

March 19, 1984.

As Amended on Denial of Rehearing and Rehearing En Banc May 21, 1984.

Frank Maloney, David L. Botsford, Austin, Tex., for defendant-appellant.

Frederic Freilicher, John J. Powers, III, Attys., Dept. of Justice, Washington, D.C., for plaintiff-appellee.

Appeal from the United States District Court for the Western District of Texas.

Before BROWN, REAVLEY and WILLIAMS, Circuit Judges.

JERRE S. WILLIAMS, Circuit Judge.

Appellant, Young Brothers, Inc., Contractors, ¹ was convicted by jury of violating Sec. 1 of the Sherman Act, 15 U.S.C. Sec. 1, by conspiring to submit collusive, non-competitive "rigged" contract bids for a state highway construction project and also of violating 18 U.S.C. Sec. 1341 by using the mails to defraud in furtherance of the conspiracy. Appellant appeals the convictions, challenging (1) the sufficiency of the evidence; (2) the jury instructions; (3) the court's exclusion of certain grand jury testimony; and (4) various evidentiary rulings. Finding no reversible error on any of these challenges, we affirm.

FACTS

Through a three-member Highway Commission, the State of Texas contracts with various firms to perform highway construction work. Texas law mandates that highway contracts be awarded on the basis of sealed competitive bids submitted by the various construction contractors. In June 1977, the Highway Department put up for bid a seal coat job to be completed on 63 miles of highway located primarily in Gillespie County, Texas. ² The bids were to be received no later than 9:00 a.m. on June 23, 1977, at the Highway Department in Austin, Texas.

After the Texas Highway Department announced bidding on the Gillespie County job, Gerald Gold, president of Gold Paving Aggregate, Inc., a highway construction company, telephoned John Miller, appellant's vice president. Although Gold was interested in doing the Gillespie County job, he was not qualified to bid on it because at that time his company was primarily in the sand, gravel, and paving business. He therefore asked Miller if appellant corporation would agree to submit a bid and, if the bid was successful, to subcontract the work to Gold. ³ It was agreed that appellant would bid the job and that Gold would deliver his estimate to Miller in Austin the night before the bid deadline.

On the evening of June 22, Gold accordingly delivered a bid estimate to Miller. Gold's original estimate was approximately $410,000. When Miller indicated he thought the job would go somewhat higher, Gold responded that a bid in the $420,000 "range ... was a good idea." Although no final figure was decided on at the meeting, the two men parted with the understanding that Miller would submit a bid for Gold. The bid actually submitted by appellant was $461,797.50, more than $9,000.00 above the low bid of $452,221.22 (submitted by Brannon Contractors, Inc.), and more than $50,000.00 above Gold's original estimate.

The evidence adduced at trial showed that the reason appellant had submitted a bid so far above Gold's estimate was that, unknown to Gold, appellant and others had "rigged" the bid. The bid submitted by appellant was a "complimentary bid" designed to deceive state officials into believing that the project had been bid competitively. This conspiracy was organized by W.J. Brannon, Sr., president of Brannon Contractors, Inc., and his son, W.J. Brannon, Jr. ⁴

On June 21, 1977, the Brannons went to Austin. Using the Highway Department list of those who had requested bid proposals on the Gillespie County job, they spent the next day contacting the contractors on the list to determine whether they intended to bid on the Gillespie County project. Their objective was to "set up the job" by persuading potential bidders not to submit a bid or to submit a complimentary bid that was higher than the bid submitted by Brannon Contractors. After talking to some contractors who expressed no interest in bidding on the Gillespie County job, Brannon, Sr. spoke to Jack Schwope of Schwope, Inc., and Keith Keller of the Allen Keller Company. Both informed Brannon they intended to bid on the job. Brannon was able to persuade both Schwope and Keller not to turn in competitive bids, but instead to make complimentary bids so that Brannon Contractors would be assured of being the low bidder.

On the night before the bid deadline, Brannon, Sr. met with appellant's vice president, John Miller, in Miller's hotel room. Brannon informed Miller that he "had everyone off the job" and that he would "appreciate it" if Miller "would go along and not bid the job competitive." After Miller told Brannon he was under instructions from appellant's president, Francis Young, to place a competitive bid, Brannon asked Miller to telephone Young so that Brannon could talk to him. During the telephone conversation, Young informed Brannon that he was actually bidding the job for Gold and that Young Brothers "needed to make some money" because it "hadn't had a whole lot of work." Young finally agreed not to bid the job competitively in return for $10,000. Young, without request from Brannon, added that he would like to turn in a complimentary bid. They agreed at that time that after Brannon was awarded the job, Young would send Brannon a bill for "rental equipment" and that the bill would be for ten thousand plus "some odd dollars."

The next morning, prior to the bid deadline, Brannon, Jr. contacted Miller, Schwope, and Keller and gave them the necessary complimentary bid figures. Schwope accordingly bid $471,498.00; appellant bid $461,797.50; Allen Keller bid $458,799.50; and Brannon bid $452,221.22. Brannon, the low bidder, was awarded the Gillespie County job. Brannon Contractors subsequently performed the work, earning a profit of $135,000.

After the job was awarded, on July 28, 1977, Brannon, Jr. called Miller at appellant's offices in Waco, Texas. Miller transferred Brannon's call to Oliver Rudolff, appellant's comptroller. While transferring the call, Miller advised Rudolff that Brannon wanted to give Rudolff billing instructions. Brannon, accordingly, instructed Rudolff to send him an invoice for $10,001. Brannon asked Rudolff to show on the invoice that the $10,001 was for the rental of equipment for use in constructing a sub-division in Victoria, Texas. Pursuant to Brannon's request, an invoice was prepared and mailed to Brannon Contractors on or about July 30, 1977. On August 10, 1977, after receiving the invoice, Brannon Contractors mailed a check made out to appellant for $10,001. The check was deposited in the appellant's bank account in the normal course of business. At no time did Brannon Contractors actually rent any equipment or receive any services from appellant for the Victoria subdivision.

In a three-count indictment, appellant Young Brothers, Inc., Contractors, John W. Miller, appellant's vice president, Brannon Contractors, Inc., and various unindicted co-conspirators were charged with (1) engaging in a conspiracy in violation of Sec. 1 of the Sherman Act (15 U.S.C. Sec. 1) (count one); and (2) using the United States mail in a scheme to defraud the State of Texas in violation of 18 U.S.C. Sec. 1341 (counts two and three). Appellant's president, Francis M. Young, was separately indicted for the same offenses. The indictments were subsequently consolidated for trial. Prior to the trial, the district court accepted a guilty plea from Brannon Contractors, Inc. to count one of the indictment and sentenced it to pay a fine of $200,000, later reduced to $150,000. ⁵ The jury returned verdicts of innocent on all counts with respect to defendants Miller and Young, and guilty on all counts with respect to appellant, Young Brothers. Appellant was sentenced to pay a $750,000 fine on count one and a $1,000 fine on each of counts two and three.

SUFFICIENCY OF THE EVIDENCE

Appellant argues that the evidence is insufficient to support its conviction unless the evidence excludes every reasonable hypothesis of innocence, presumably on the theory that if there is such a reasonable hypothesis the jury must have had a reasonable doubt of appellant's guilt. Specifically appellant contends that a reasonable hypothesis of innocence was not excluded by the evidence adduced at trial: that Miller and Young feigned agreement with the Brannons, disregarded the figure supplied by them, competitively bid the project to honor the pre-existing agreement with Gold, had no intention of approaching the Brannons for the $10,000, and were "amazed" when Brannon, Jr. arranged to pay the appellant.

Appellant has not stated the correct standard of review for sufficiency of the evidence. "It is not necessary that the evidence exclude every reasonable hypothesis of innocence or be wholly inconsistent with every conclusion except that of guilt, provided a reasonable trier of fact could find that the evidence establishes guilt beyond a reasonable doubt." United States v. Bell, 678 F.2d 547, 594 (5th Cir.1982) (en banc), aff'd, --- U.S. ----, 103 S.Ct. 2398, 76 L.Ed.2d 638 (1983); accord United States v. Sneed, 705 F.2d 745, 749 (5th Cir.1983); United States v. Shaw, 701 F.2d 367, 394 (5th Cir.1983). ⁶ It is within the jury's province to choose among reasonable constructions of the evidence. As an appellate court, we must view the evidence in the light most favorable to the government, Glasser v. United States, 315 U.S. 60, 80, 62 S.Ct. 457, 469, 86 L.Ed. 680 (1942) and accept all credibility choices and reasonable inferences the jury could have made to support its verdict. We may reverse only upon concluding that a reasonable jury would have been compelled to find that guilt was not proved beyond a reasonable doubt. United States v. Saxton, 691 F.2d 712,...