United States v. Climatemp, Inc.
| Decision Date | 26 July 1979 |
| Docket Number | No. 78 CR 388.,78 CR 388. |
| Citation | 482 F. Supp. 376 |
| Court | U.S. District Court — Northern District of Illinois |
| Parties | UNITED STATES of America v. CLIMATEMP, INC.; Evco Associates, Inc.; Gideon Engineering Corp.; R. A. Martin Co., Inc.; Reliable Sheet Metal Works, Inc.; Steel City Ventilating & Sheet Metal Co.; Zack Company; Hardy Ventilating Corporation; The Narowetz Company; Sheet Metal Workers, International Association, Local 73; Robert Ahrenhold; William Black; Victor Comforte; John Eiselt; Melvin Fakter; Kenneth Gardner; Gideon Goldschmidt; Charles L. Howard; Raymond J. Lyons. |
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Arthur Feiveson, U. S. Dept. of Justice, Washington, D. C., for plaintiff.
Michael B. Nash, Chicago, Ill., for Climatemp, Inc.
Kenneth A. Stoumen, Lawrence T. Stanner, Chicago, Ill., for Evco Associates.
Theodore G. Gaines, John D. Donlevy, Bryson P. Burnham, Chicago, Ill., for Gideon Engineering.
Alvin E. Rosenbloom, Chicago, Ill., for R. A. Martin Co.
Sherman C. Magidson, Francis E. Andrew, Chicago, Ill., for Reliable Sheet Metal.
George D. Crowley, Chicago, Ill., for Zack Co.
William J. Martin, Chicago, Ill., for Narowetz Co.
Harry J. Busch, Sherman C. Magidson, Chicago, Ill., for Sheet Metal Workers.
Robert S. Bailey, Chicago, Ill., for Robert Ahrenhold.
Harry J. Busch, Sherman C. Magidson, Chicago, Ill., for William Black.
Michael B. Nash, Chicago, Ill., for Victor Comforte.
Kenneth A. Stoumen, Lawrence T. Stanner, Chicago, Ill., for John Eiselt.
Sherman C. Magidson, Francis E. Andrew, Chicago, Ill., for Melvin Fakter.
Robert S. Bailey, Chicago, Ill., for Kenneth Gardner.
Theodore G. Gaines, George J. Cotsirilos, Chicago, Ill., for Gideon Goldschmidt.
George D. Crowley, Chicago, Ill., for Charles L. Howard.
Richard A. Walsh, Chicago, Ill., for Raymond Lyons.
The indictment in this case arises out of an alleged bid-rigging scheme within the sheet metal industry. Count I of the indictment charges that the defendants combined and conspired to allocate the jobs and rig the bidding on certain contracts for the sheet metal phase of construction on public projects in the Chicago area in violation of § 1 of the Sherman Act, 15 U.S.C. § 1. Counts 2 through 13 charge that the defendants conspired to defraud governmental entities soliciting bids on public projects by submitting these rigged bids and that in furtherance of this scheme the defendants used the United States mails, in violation of 18 U.S.C. § 1341. The defendants have filed various pre-trial motions to which the government has responded. The court shall rule on these motions seriatim.
Initially we note that numerous defendants have filed motions to adopt the motions of various other defendants. These motions are granted. Thus, in discussing the merits of the motions that follow, the court will consider them collectively, without regard to the defendant who raised the issue.
The defendants argue that Congress has overstepped constitutional limitations in making a felony out of the Sherman Act and that the Sherman Act as amended is unconstitutionally vague. The defendants cite no case law or other authority in support of this position beyond this conclusory allegation. This argument is without merit. That the Sherman Act is constitutional is well settled. Northern Securities Co. v. United States, 193 U.S. 197, 24 S.Ct. 436, 48 L.Ed. 679 (1904). Under the Commerce Clause, U.S.C.A.Const. Art. 1 § 8 cl. 3, Congress has the authority to impose criminal liability for violations in restraint of trade or commerce.
Defendants contend that Counts II through XIII are indistinguishable from Count I, and merely repeat the allegations of Count I. Their argument is that Count I charges a textbook example of a bid-rigging offense, while the remaining counts "have emasculated this routine charge into a series of further felonies under the mail fraud statute." The defendant argues that by tacking on the mail fraud counts the government has sought to multiply the number of offenses which can be attributed to a single activity.
This indictment does not attempt to multiply the offenses against the defendants by charging them with the same offense in several different counts. The allegations of mail fraud do not merely repeat the allegations of Count I. The Sherman Act and the mail fraud counts are separate and distinct offenses and require different elements of proof. In United States v. Brighton Building and Maintenance Co., 435 F.Supp. 222 (N.D.Ill.1977), a defendant made a similar motion to dismiss 37 mail fraud counts on the ground that they were mere reiterations of the conspiracy charge alleged in Count I with a mail fraud allegation included. The court found the argument without merit, ruling that the elements of the crime alleged in Count I differed from the elements of the crimes charged in Counts II through XXXVIII.
Since the elements of the crimes charged differ, they can be brought together and punished individually. See United States v. Pocono Inter. Corp., 378 F.Supp. 1265 (S.D.N.Y.1974). It is not rare that one series of actions by a defendant can give rise to more than one violation of the laws of a jurisdiction and each such violation can be punished. See Pereira v. United States, 347 U.S. 1, 11, 74 S.Ct. 358, 98 L.Ed. 435 (1954). 435 F.Supp. at 229.
Not only is mail fraud a separate offense from the Sherman Act, but each count of mail fraud in itself is a separate offense. United States v. Joyce, 499 F.2d 9, 18 (7th Cir. 1974) citing Badders v. United States, 240 U.S. 391, 36 S.Ct. 367, 60 L.Ed. 706 (1916). Therefore, since the various counts do not repeat the same offense but charge separate offenses the motion to dismiss on the ground that the indictment is multiplicious is denied.
Defendants have also moved to dismiss the indictment on the ground that the indictment fails to expressly allege intent. Intent is an essential element in a criminal violation of the Sherman Act. In United States v. United Gypsum Co., 438 U.S. 422, 98 S.Ct. 2864, 57 L.Ed.2d 854 (1978), the Supreme Court held that in criminal violations of the Sherman Act the government is required to prove either that: (1) the defendant acted with knowledge that his acts would have probable anticompetitive effects, or (2) that the defendant acted with the purpose of producing anticompetitive effects. The defendant moves to dismiss on the ground that the instant indictment contains no allegation that the defendants ever had the requisite intent to effectuate the object of the conspiracy.
In evaluating the sufficiency of an indictment, common sense and reason prevail over technicalities. Parsons v. United States, 189 F.2d 252, 253 (5th Cir. 1951). Fairly read, the present indictment meets the requirement of Rule 7(c) of the Fed.R. Crim.Pro. in that it contains "a plain, concise and definite written statement of the essential facts constituting the offense charged." In analyzing the indictment in its whole context, it is clear that all of the necessary elements are expressed or implied. United States v. Wabaunsee, 528 F.2d 1, 3-4 (7th Cir. 1975).
In Count I of the instant indictment the defendants are charged with a conspiracy to restrain trade by allocating jobs and rigging bids. Paragraphs 12-14 charge that the defendants engaged in a combination and conspiracy in unreasonable restraint of interstate trade and commerce, that this combination and conspiracy consisted of a continuing agreement, and that the defendants did those things which they conspired to do. Although the word "intent" is not specifically used, the requisite mental state of knowledge or intent is implicit in the charge. United States v. Azzarelli Const. Co., 459 F.Supp. 146, 149 (1978).1
Accordingly, this Court finds that the instant indictment meets the test of Gypsum. Although the word intent is not specifically used here, it may be implied from a reading of the whole of the indictment. As will be developed more fully later in this order, the court finds that the indictment meets the constitutional requirements in that it provides the defendants with sufficient information to prepare a defense and protect them against double jeopardy. United States v. Ray et al., 514 F.2d 418, 422 (7th Cir. 1975).
Defendants argue that a necessary element of § 1341 is that the mailing be in execution of the scheme to defraud, and that the alleged mailings here were subsequent to and not incidental to the scheme and so, not in execution of the scheme. At this stage of the proceedings the court is merely passing upon the sufficiency of the indictment. The question as to the relationship between the bid-rigging scheme and the mailings is an evidentiary matter. The issue here is whether the court, upon reading the indictment would find it inconceivable that the government could produce evidence at trial to show that the mailings were in furtherance of the scheme. Thus, the only questions here are first whether the indictment charges a fraudulent scheme within the scope of the mail fraud statute, and, second, whether the indictment alleges mailings in furtherance of that alleged scheme. The two necessary elements for a violation of the mail fraud statute are: (1) formation of a scheme with intent to defraud, and (2) the use of the mails in furtherance of that scheme. United States v. Keane, 522 F.2d 534, 544 (7th Cir. 1975). It is not necessary that the scheme contemplate the use of the mails as an essential element. Pereira v. United States, 347 U.S. 1, 74...
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