United States v. Corrigan, 183

• Decision Date: 28 May 1948
• Docket Number: No. 183,Docket 20876.,183
• Citation: 168 F.2d 641
• Parties: UNITED STATES v. CORRIGAN et al.
• Court: U.S. Court of Appeals — Second Circuit

168 F.2d 641 (1948)

UNITED STATES v. CORRIGAN et al.

No. 183, Docket 20876.

Circuit Court of Appeals, Second Circuit.

May 28, 1948.

Albert L. Solodar, of New York City (John McKim Minton and Harold H. Levin, both of New York City, of counsel), for appellants.

John F. X. McGohey, U. S. Atty., of New York City (Frank H. Gordon, Sp. Asst. to the Atty. Gen. William E. Foley, of Boston, Mass., and Bruno Schachner, Asst. U. S. Atty., of New York City, of counsel), for appellee.

Before L. HAND, SWAN and FRANK, Circuit Judges.

SWAN, Circuit Judge.

Upon trial to a jury the appellants, Corrigan, Wells and their corporation, Corrigan, Osburne & Wells, Inc., were convicted of having conspired to defraud the United States of the faithful and impartial services of Corrigan as a civilain employee of the Navy and as a naval officer. Corrigan was sentenced to eighteen months' imprisonment and fined $5,000, Wells was sentenced to a year and a day, and the corporation was fined $10,000. Their appeals raise only two contentions: (1) that the evidence was insufficient to sustain the verdict; and (2) that error was committed in the admission of Exhibits 39 and 40 which will be described hereafter.

Corrigan entered the service of the Navy as a civilian employee at the end of March 1942 and shortly thereafter was commissioned Lieutenant Commander and, later, Commander. His duties were to inspect the plants of manufacturers who were under contract to supply war materials to the Bureau of Ordnance, and to report to his superiors what action should be taken by the Navy to facilitate the production of such materials. The indictment, filed December 19, 1944, charged that Corrigan and Wells, who conducted a management engineering business through their corporation, Corrigan, Osburne & Wells, Inc., conspired to make use of Corrigan's position with the Navy to induce contractors whose plants he inspected to employ the services of said corporation. More specifically the charge was that the reports Corrigan made after his inspections would favor those contractors who employed, or indicated their willingness to employ, Corrigan, Osburne & Wells, Inc., as management engineering consultants. It is obvious that this kind of charge can be proved only by indirect evidence. The testimony and exhibits were voluminous. To restate the entire evidence would be quite impractical; nor is it necessary. After verdict all permissible inferences must be made in favor of the prosecution. United States v. Bushwick Mills, 2 Cir., 165 F.2d 198.

In our opinion there was ample evidence to sustain the convictions. Corrigan was graduated from the Naval Academy in 1920. After a short period of active duty he left the Navy to engage in business. In 1939 he formed a partnership with appellant Wells, who was an industrial engineer, to engage in business as management engineering consultants. Shortly thereafter they caused the business to be incorporated as Corrigan, Osburne & Wells, Inc., each taking one-half of the controlling stock. Corrigan was elected president of the corporation. He was to devote his energies principally to sales activities while Wells was in charge of the engineering. Each was to receive an annual salary of $12,000, but during 1940 and 1941 the profits of the business were insufficient to pay the full amount of their salaries. In the spring of 1942, Corrigan was interviewed by Admiral (then Captain) Ruddock of the Bureau of Ordnance with a view to interesting him in returning to the Navy. The position Captain Ruddock had in mind for Corrigan was a vacancy in the Production Division of the Bureau of Ordnance; he was to be production "trouble-shooter" in war plants working under contracts with the Navy. Captain Ruddock required as a condition precedent to his employment by the Navy that Corrigan "sever his connections" with Corrigan, Osburne & Wells, Inc., in order "to avoid any conflict of interest." This Corrigan agreed to do, and he did resign as a director and as president of the corporation, Wells being elected president in his stead. He did not, however, "sever his connections" with the corporation. He continued to receive a salary, being paid by the corporation approximately $35,000 during the 26 months he was in the Navy. That he was aware of the impropriety of such payments is a fair inference from the fact that he concealed them from his superiors even when he wrote a letter to the Chief of the Bureau of Ordnance purporting to disclose his relations with Corrigan, Osburne & Wells, Inc.¹

In addition to remaining on the payroll Corrigan continued an active interest in the company and constantly wrote and telephoned Wells about its business affairs. In violation of Navy regulations he furnished Mr. Amour, head of the company's Chicago office, a list of the contractors with whom the Bureau of Ordnance was doing business. This list was classified by the Navy as "Restricted" information and thus was not available for general distribution, and Corrigan warned Amour to burn the list when through with it. He concealed his continuing connection with the company not only from the Navy but also from several contractors whose plants he inspected. In numerous instances he would tell the contractor that production could be improved by the employment of a management engineer consultant, and would state that he had formerly been, but was no longer, connected with Corrigan, Osburne & Wells, Inc., a management engineering company of the type needed, thus implying that this company could furnish the needed services. Subsequently Wells or some other representative of the company would call on the contractor and endeavor to sell its services, and the latter would often indicate that he already knew of Corrigan's inspection. In some instances if the company was not employed, Corrigan's report to the Navy would criticize adversely the contractor's production methods.

It is the cumulation of instances of this sort which is particularly significant. If a government official repeatedly recommends a company in which he falsely pretends to have no interest, it is a permissible inference that his recommendation is actuated by some motive other than solely the discharge of his duty. And the inference is confirmed by Corrigan's constant communications with Wells concerning the company's business.

To all the above the appellants make no real answer except to relate evidence which tended to exonerate them. Such evidence is not relevant on appeal; our function is merely to determine whether the prosecution's evidence, if credited by the jury, is sufficient to support the verdict. United States v. Compagna, 2 Cir., 146 F.2d 524, 526, certiorari denied 324 U.S. 867, 65 S.Ct. 912, 89 L.Ed. 1422; United States v. Randall, 7 Cir., 164 F.2d 284, 286. On this issue we entertain no doubt.

Exhibits 39 and 40, the admission of which is urged as error, are related to an inspection and report made by Corrigan of Waterbury Tool Division of Vickers, Inc. Before Corrigan was employed by the Navy he and Wells had endeavored unsuccessfully to sell the services of Corrigan, Osburne & Wells, Inc. to Waterbury Tool Division. When Corrigan made his official inspection of the plant in the summer of 1942 he...