United States v. Lane
| Decision Date | 06 June 1963 |
| Citation | 218 F. Supp. 459 |
| Parties | UNITED STATES of America v. Stanley LANE and Joseph Valle, Defendants. |
| Court | U.S. District Court — Southern District of New York |
Robert M. Morgenthau, U. S. Atty. for the Southern Dist. of New York, for the United States; Richard C. Casey, Asst. U. S. Atty., New York City, of counsel.
Spar, Schlem & Burroughs, New York City, for defendants; Charles Spar, Leon B. Savetsky, New York City, of counsel.
On August 3, 1962 the grand jury for the Southern District of New York handed up a three-count indictment against the defendants Lane and Valle.
Count One charges that on or about May 23, 1962 the defendants unlawfully, wilfully and knowingly did acquire gold bullion having a value of approximately $7500 without a license therefor having been issued pursuant to Executive Order No. 6260 of the President of the United States, dated August 28, 1933, as amended.
Count Two charges that on or about May 23, 1962 the defendants unlawfully, wilfully and knowingly did hold in their possession gold bullion having a value of approximately $7500 without a license therefor having been issued pursuant to Executive Order No. 6260 of the President of the United States, dated August 28, 1933, as amended.
Title 12 U.S.C. § 95a is cited to each said count.
Count Three charges that continuously between about May 1, 1962 and the date of the filing of the indictment the defendants unlawfully, wilfully and knowingly conspired to violate Title 31 U.S.C. §§ 440, 441, 442 and 443 and the regulations promulgated thereunder (Title 31, Subtitle B, Chapter 1, Part 54, C.F.R.) and thereby to defraud the United States in the exercise of its governmental functions of regulating the value of money, stabilizing the exchange value of the dollar and regulating and controlling the acquisition, holding, etc. of gold without a license duly issued therefor.
Title 18 U.S.C. § 371 is cited to the third count.
Assigned for trial, defendants now move to dismiss each count of the indictment as failing to state a public offense.
As to the first and second counts defendants rely upon United States v. Briddle, 212 F.Supp. 584 (S.D.Cal.1962). It appears that in that case the indictment was originally dismissed on August 16, 1962 upon a memorandum decision:
"Indictment for holding gold bullion in violation of 12 U.S.C. § 95a and Executive Order No. 6260 must be dismissed because 1933 economic emergency requisite to validity of Executive Order No. 6260 and imposition of criminal sanctions no longer exists."
On September 14, 1962 the United States filed a notice of appeal to the Supreme Court pursuant to Title 18 U.S. C. § 3731, from the said order of August 16, 1962 but on November 14, 1962 the parties stipulated, pursuant to Supreme Court Rule 14, that said appeal be dismissed. Thereafter, the court's opinion of December 27, 1962 (212 F.Supp. 584) was filed.
The indictment in Briddle differs from the instant indictment in two respects. Whereas, as above indicated, the indictment herein contains two substantive counts, one for acquiring and the second for possessing gold in violation of Title 12 U.S.C. § 95a, the indictment in Briddle contained only one count charging both acquisition and possession of gold in violation of that statute. The second difference is that there was no count in the Briddle indictment charging, as in the third count here, a conspiracy to violate Title 31 U.S.C. §§ 440-443.
If I were to follow the holding in Briddle the defendants' motion would have to be granted as to both the first and second counts of this indictment. Finding myself unable to agree with Briddle insofar as that decision affects the two substantive counts of the indictment before me, I state my reasons therefor.
After the declaration on April 6, 19171 of a state of war between the United States and Germany by the 65th Congress at its 1st Session, the Trading with the enemy Act2 was passed on October 6, 1917 at the same session. Section 5 of the original Trading with the enemy Act, inter alia, provided:
"(b) That the President may investigate, regulate, or prohibit, under such rules and regulations as he may prescribe, by means of licenses or otherwise, any transactions in foreign exchange, export or earmarkings of gold or silver coin or bullion or currency, * * *."
The entire tenor of the original Trading with the enemy Act appeared to be related to the then recently declared participation by this country in World War I.
At the 2nd Session of the same Congress, Section 5(b) of the Trading with the enemy Act was on September 24, 1918 amended3 to provide:
Thus the Trading with the enemy Act as amended in September 1918 addressed itself specifically and was limited to World War I and two years thereafter.
Long after World War I had ended and on March 9, 1933 the 73rd Congress at its 1st Session4 further amended Section 5(b) of the Trading with the enemy Act to read:
"During time of war or during any other period of national emergency declared by the President, the President may, through any agency that he may designate, or otherwise, investigate, regulate, or prohibit, under such rules and regulations as he may prescribe, by means of licenses or otherwise, any transactions in foreign exchange, transfers of credit between or payments by banking institutions as defined by the President, and export, hoarding, melting, or earmarking of gold or silver coin or bullion or currency * * *." (Emphasis supplied.)
Said section was further amended to provide that:
"Whoever willfully violates any of the provisions of this subdivision or of any license, order, rule or regulation issued thereunder, shall, upon conviction, be fined not more than $10,000, or, if a natural person, may be imprisoned for not more than ten years, or both; * * *."
Insofar as the acquisition and possession of gold bullion, as charged in the first two counts of the instant indictment, are concerned, it appears that President Franklin D. Roosevelt exercised the power granted by Section 5(b) of the Trading with the enemy Act as amended on March 9, 1933 by Executive Order No. 6102, promulgated on April 5, 1933.5 That Executive Order required the delivery of gold bullion on or before May 1, 1933 to designated depositories; provided for the payment therefor in other form of United States coin or currency and for the issuance by the Secretary of the Treasury of licenses for the retention of specified gold.
On August 28, 1933 President Franklin D. Roosevelt issued Executive Order No. 6260.6 Executive Order No. 6260, after declaring the existence of a national emergency, in Section 4 forbade, after the date of the order, with certain exceptions not here pertinent, the acquisition of gold bullion and, in Section 5 forbade, subsequent to 30 days from the date thereof, the holding or retention of any interest in gold bullion except such as the Secretary of the Treasury might permit by license. Executive Order No. 6260 revoked Executive Order No. 6102.
There can be no doubt that Executive Order No. 6260 was predicated upon a declared "national emergency in banking" and thus was promulgated not during a "time of war" but under the alternative power "during any other period of national emergency". Nor can there be any doubt that the last stated amendment to the Trading with the enemy Act upon which Executive Order No. 6260 was based was hurriedly enacted to meet that emergency,7 at an extra session of Congress8 convened on the last day of the bank holiday proclaimed by the President on March 6, 1933.9
If the foregoing history were all that is involved in considering defendants' present motion, their argument might be persuasive that, as to the first two counts of the indictment, as held in Briddle, supra, such national emergency in banking was no longer extant on May 23, 1962 and their acquisition and possession of gold bullion on that day did not constitute a criminally punishable public offense. But, it is not because later events are apposite.
On December 16, 1950 President Harry S. Truman issued Proclamation No. 291410 "proclaiming the existence of a national emergency". Declaring that "recent events in Korea and elsewhere" and "world conquest by communist imperialism" constituted a present threat to the liberties and economic advantages enjoyed by the people of this country under a free democratic society, he rallied "the full moral and material strength of the Nation" to readiness to meet the threatening danger. As is conceded in Briddle, supra, 212 F.Supp. at 589, "Communist imperialism continues to pose a threat to the nation".
On the same day that President Truman issued Proclamation No. 2914 the White House released to the press a list of "Provisions of law which would become operative upon proclamation of a national emergency by the President".11 Admittedly neither the Trading with the enemy Act nor Title 12 U.S.C. § 95a is mentioned in that list. The significance of this omission is not apparent but it may be because of a string of cases up to that time acknowledging the integrity of the criminal sanctions of Title 12 U.S. C. § 95a and Executive Order No. 6260.12 The omission may also be explained by the fact that, of the more than fifty acts and joint resolutions contained in that list (except for those dealing with consumer credit controls, members of Congress serving in the armed forces, war risk insurance and wages and hours of labor) all deal with matters affecting the army, navy, air force,...
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