United States v. Duff

• Decision Date: 25 November 1981
• Docket Number: 81 CR 589.,No. 81 CR 475,81 CR 475
• Citation: 529 F. Supp. 148
• Court: U.S. District Court — Northern District of Illinois
• Parties: UNITED STATES of America, Plaintiff, v. John F. DUFF and Howard Hansen, Defendants.

529 F. Supp. 148

UNITED STATES of America, Plaintiff, v. John F. DUFF and Howard Hansen, Defendants.

Nos. 81 CR 475, 81 CR 589.

United States District Court, N. D. Illinois, E. D.

November 20, 1981.

On Motion To Dismiss Indictment November 25, 1981.

Mark Vogel, Asst. Chicago Strike Force Atty., Chicago, Ill., for plaintiff.

John Powers Crowley, Chicago, Ill., for Duff.

William Martin, Chicago, Ill., for Hansen.

On Motion To Dismiss Indictment November 25, 1981, see 529 F.Supp. 153.

MEMORANDUM OPINION AND ORDER

ASPEN, District Judge:

Defendants John F. Duff and Howard Hansen were indicted by a federal grand jury for violations of §§ 501(c) and 209(c) of the Labor Management Reporting and Disclosure Act of 1959. 29 U.S.C. § 501(c);¹ 29 U.S.C. § 439(c).² This action is presently before the Court on defendants' motion to dismiss the charges.³ For the reasons set forth below, that motion will be denied.

The indictment and information charge that at the time of the alleged offenses Duff was Vice-President of the Distillery, Wine and Allied Workers International Union, Secretary-Treasurer of the Chicago Local 3 and Special Representative of the International Union assigned to oversee the affairs of Detroit Local 42 and that Hansen was President of the Chicago Local 3. Duff is charged with converting approximately $76,607.14 from Locals 3 and 42, in violation of § 501(c), through an unauthorized salary increase, unauthorized expense payments, abstraction of checks from Local's bank account, and a political contribution. Hansen is similarly charged with converting approximately $9,735 from Local 3, in violation of § 501(c), through an unauthorized salary increase. In addition, both defendants are accused of diverting approximately $17,457 in dues checkoff monies from Local 42 to Local 3 in violation of § 501(c) and of making a false entry in a record of Local 3, in violation of § 439(c), regarding the purported approval by the executive board in obtaining a $75,000 loan to purchase furniture and remodel Local 3's office space.

Defendants have moved to dismiss the charges on the grounds that they are vague and indefinite, fail to inform them of the accusations with the specificity required by law and make it impossible for them to prepare a defense or to plead double jeopardy in the future. The motion also alleges that federal jurisdiction is lacking, and that the charges violate Rule 7 of the Federal Rules of Criminal Procedure as well as the Sixth Amendment to the Constitution.

Rule 7(c)(1) of the Federal Rules of Criminal Procedure provides that an indictment or information "shall be a plain, concise and definite written statement of the essential facts constituting the offense charged.... It need not contain ... any other matter not necessary to such statement...."⁴ In evaluating the sufficiency of an indictment,⁵ common sense and reason prevail over technicalities. United States v. Willis, 515 F.2d 798, 800 (7th Cir. 1975); United States v. Climatemps, 482 F.Supp. 376, 382 (N.D.Ill.1979) citing Parsons v. United States, 189 F.2d 252, 253 (5th Cir. 1951). Thus, an indictment is sufficient if it, "first, contains the elements of the offense charged and fairly informs a defendant of the charge against which he must defend, and, second, enables him to plead an acquittal or conviction in bar of future prosecutions for the same offense." Hamling v. United States, 418 U.S. 87, 117, 94 S.Ct. 2887, 2907, 41 L.Ed.2d 590 (1974).

Section 501(c) Counts

Counts One through Eight of the indictment charge one or both defendants with violations of 29 U.S.C. § 501(c). Each of these counts specifically allege the approximate date of the transaction, the dollar amount involved, and that the entity unlawfully deprived of its assets was a "labor organization" engaged in an industry affecting commerce within the meaning of 29 U.S.C. §§ 402(i) and 402(j).⁶ Each count tracks the language of § 501(c), which has been held "to cover almost every kind of taking, whether by larceny, theft, embezzlement or conversion." United States v. Harmon, 339 F.2d 354, 357 (6th Cir. 1964), cert. denied, 380 U.S. 944, 85 S.Ct. 1025, 13 L.Ed.2d 963, reh. denied, 380 U.S. 989, 85 S.Ct. 1330, 14 L.Ed.2d 282.

Defendants argue that mere repetition of statutory language does not suffice to meet the constitutional requirements, relying heavily on Russell v. United States, 369 U.S. 749, 82 S.Ct. 1038, 8 L.Ed.2d 240 (1962).⁷ However, "it is generally sufficient that an indictment set forth the offense in the words of the statute itself, as long as those words of themselves fully, directly, and expressly, without any uncertainty or ambiguity, set forth all the elements necessary to constitute the offense meant to be punished." Hamling v. United States, 418 U.S. 87, 117, 94 S.Ct. 2887, 2907, 41 L.Ed.2d 590 (1974). Unlike in Russell, where a factual definition is crucial to an adequate description of a statutory element of proof, the instant indictment charges the defendants with crimes adequately described by legal words of art which do not vary in meaning from case to case. The statutory terms "embezzles, steals, or unlawfully and willfully abstracts or converts to his own use" in § 501(c) have a common legal meaning, requiring little or no factual amplification. Hubbard v. United States, 79 F.2d 850, 852 (9th Cir. 1935) (the term "embezzle" has a settled technical meaning); United States v. Northway, 120 U.S. 327, 334-335, 7 S.Ct. 580, 584, 30 L.Ed. 664 (1887) (the term "abstract" is a word of "simple, popular meaning, without ambiguity"); United States v. Santiago, 528 F.2d 1130, 1135 (2d Cir. 1976), cert. denied, 425 U.S. 972, 96 S.Ct. 2169, 48 L.Ed.2d 795 (conversion "to his own use" means simply "not to the use of the entruster"). The instant indictment not only tracks the statutory language, but also sets forth the factual details evidencing the crimes.⁸ In light of the fact that the instant indictment charges these legal terms in the conjunctive, the defendants are placed in jeopardy as to all means of committing the named offenses. The sum of the allegations contained in the indictment, both factual and legal, gives adequate notice to the defendants of the offenses being charged.⁹

The government has followed the judicially accepted format in drafting the instant indictment. The First Circuit stated in Colella v. United States, 360 F.2d 792 (1st Cir. 1966): "Section 501(c) establishes a new federal crime of embezzlement of any funds of a labor organization. The new crime can be accomplished in one of four ways: embezzling, stealing, unlawfully and willfully abstracting, and unlawfully and willfully converting ... as far as the defendant is concerned, he has been placed in jeopardy with respect to all means of committing the offense by the proper manner of substitution in the indictment of the conjunctive `and' for the statutory distinctive `or.'" Colella, supra at 799-800. Another indictment containing virtually identical language as the § 501(c) counts herein was upheld by the Second Circuit. There, the court stated, "The events described in the indictment were quite specific as to the dates of the transactions, the amounts involved and the parties from whom the funds were taken. Such allegations were sufficient to guard against giving improper discretion to the court and prosecutor to vary the trial proof from the theory upon which the indictment is based ... no one could suppose that the prosecutor would be free to roam at large in proving elements of the crime so explicitly stated." United States v. Silverman, 430 F.2d 106, 111-112 (2d Cir. 1970), modified on other grounds, 439 F.2d 1198 (1970), cert. denied, 402 U.S. 953, 91 S.Ct. 1619, 29 L.Ed.2d 123, reh. denied, 403 U.S. 924, 91 S.Ct. 2227, 29 L.Ed.2d 704.

The defendants also argue that the indictment is defective because it fails to allege whether their various alleged takings were authorized or unauthorized.¹⁰ While there is confusion among the various circuits regarding the elements of the 501(c) offense, the underlying concern of most courts is that the essential element of fraudulent intent is clearly charged in the indictment.¹¹ The existence or non-existence of authorization is more related to the issue of sufficiency of the evidence than to validity of the indictment itself. See Silverman, supra, 430 F.2d at 114-115. The Ninth Circuit held that "neither a lack of union authorization nor an absence of good faith belief in union benefit need be alleged in an indictment as essential elements of § 501(c)...." United States v. Thordarsen, 646 F.2d 1323, 1332 (9th Cir. 1981). Concisely stated, "fraudulent intent to misuse funds is the cornerstone of a § 501(c) crime." United States v. Durnin, 632 F.2d 1297, 1300 (5th Cir. 1980).

In the case at bar, the indictment adequately alleges the defendants' fraudulent intent through the statutory terms, "did embezzle, steal, and unlawfully and willfully abstract and convert." United States v. Willis, 515 F.2d 798, 799-800 (7th Cir. 1975) (the word embezzle connotes to both lawyers and laymen that the act was performed with wrongful intent); United States v. Minick, 636 F.2d 181, 184 (7th Cir. 1980) (the term "convert" implies "some kind of willful purpose and wrongful intent in the taking of property not belonging to the converter"). See also Thordarsen, supra at 1337; Colella, supra at 798-799. Therefore, Counts One through Eight adequately inform the defendants of the charges against them in accordance with Rule 7(c)(1) of the Federal Rules of Criminal Procedure.

Section 439(c) Counts

Count Nine of the indictment and the information adequately charge the defendants with willfully making and causing a false entry to be made in a record of Local 3, a labor organization engaged in an industry affecting commerce within the meaning of 29 U.S.C. §§ 402(i) and 402(j).¹² Both charges specify the approximate date when the false entry was made,...