United States v. Mercer

• Citation: 133 F. Supp. 288
• Decision Date: 05 July 1955
• Docket Number: Crim. No. 34493.
• Parties: UNITED STATES of America, Plaintiff, v. Leonard MERCER, alias Cyril Sharron, alias R. C. Allen, alias John Thomas; John Logan and William Arnold, Defendants.
• Court: U.S. District Court — Northern District of California

133 F. Supp. 288

UNITED STATES of America, Plaintiff, v. Leonard MERCER, alias Cyril Sharron, alias R. C. Allen, alias John Thomas; John Logan and William Arnold, Defendants.

Crim. No. 34493.

United States District Court N. D. California, S. D.

July 5, 1955.

Lloyd H. Burke, U. S. Atty., John Lockley, Asst. U. S. Atty., San Francisco, Cal., for plaintiff.

Ben Davis, Jack L. Burnam, San Francisco, Cal., for defendant Cyril Sharron.

David Cannon, Cannon & Callister, Los Angeles, Cal., for defendant Harold Bourgeois.

OLIVER J. CARTER, District Judge.

Before the Court are defendants' motions to dismiss the indictment against them on the ground that it fails to allege an offense against the United States, and for judgment of acquittal as to count four of that indictment.

Counts two and three of the indictment charge the defendants with transmitting sounds by means of interstate wire for the purpose of executing a scheme to defraud, in violation of 18 U. S.C. § 1343; count four charges the defendants with transporting money of a value in excess of $5,000 in interstate commerce, knowing that money to have been taken by fraud, in violation of 18 U.S.C. § 2314; count one of the indictment charges the defendants with conspiring to violate Sections 1343 and 2314 of 18 U.S.C., and lists thirteen overt acts done in furtherance of the conspiracy. The challenge to the substantive counts two and three of the indictment will be considered first.

On the first day of the trial, just after a jury had been empanelled, counsel for defendants moved to dismiss each count of the indictment for failure to state an offense. Ruling was reserved on these motions and counsel agreed to proceed with the trial. At the close of the evidence for the prosecution counsel for defendants moved for judgment of acquittal on all four counts. The latter motions of both defendants were denied from the bench as to counts one, two and three, ruling was reserved as to count four, and the trial was recessed to permit consideration of defense motions to dismiss the indictment and for judgment of acquittal as to count four.

The challenge to counts two and three for failure to state an offense is based upon the fact that these counts charge the transmission of sounds by interstate wire for the purpose of executing a scheme to defraud, but do not indicate the nature of the scheme to defraud. Thus the objection is that these counts do not inform the defendants of what they will be required to meet at the trial. Count two is phrased substantially in the words of the statute, 18 U.S.C. § 1343, as follows:

"Said defendants, and each of them, did, on or about the 17th day of February, 1955, in the City and County of San Francisco, State and Northern District of California, having devised a scheme for obtaining money by means of false and fraudulent pretenses, representations and promises, transmit sounds by means of interstate wire from Phoenix, Arizona to San Francisco, California, for the purpose of executing such scheme."

Count three is identical except that the words "Texarkana, Texas" appear in place of the words "Phoenix, Arizona" in count two. Title 18 U.S.C. § 1343, upon which counts two and three are based, was enacted in 1952, and this Court has not been directed to any reported case which construes that statute. But cases construing the mail fraud statute, 18 U.S.C. § 1341, are treated here as analogous, because the two sections of Title 18 are cast in substantially the same language, and because both sections are grouped in the mail fraud chapter of Title 18. The government agrees with this principle of interpretation.

Cases considering indictments based upon the mail fraud statute have firmly established the rule that such an indictment is bad if it fails to charge any particulars of the scheme to defraud which is an element of the offense. The rule stems from the parent case of United States v. Hess, 124 U.S. 483, at pages 488-489, 8 S.Ct. 571, at page 574, 31 L. Ed. 516, a mail fraud case, in which the Court held:

"The essential requirements, indeed, all the particulars constituting the offense of devising a scheme to defraud, are wanting. Such particulars are matters of substance, and not of form, and their omission is not aided or cured by the verdict."

The rule has been stated most often in cases where the indictment there considered was upheld as stating sufficient particulars of the scheme to defraud; but all recognize that some description of the fraudulent scheme is a necessity. In United States v. Crummer, 10 Cir., 151 F.2d 958, 963, the court upheld the indictment there attacked, stating the rule in this way:

"While the particulars of the scheme are matters of substance and therefore must be described with a degree of certainty sufficient to show its existence of character, and fairly to acquaint the defendant with the particular fraudulent scheme charged against him, still the scheme itself need not be pleaded with all the certainty in respect of time, place, and circumstance requisite in charging the mailing of the letter or other matter." (Citations omitted.)

The rule is recognized in the Ninth Circuit in Wheeler v. United States, 9 Cir., 77 F.2d 216, 218, in which the court quotes language taken from opinions from the Eighth and Tenth Circuits:

"`* * * it is therefore sufficient to charge the scheme with such particularity as will enable the accused to know what is intended and to apprise him of what he will be required to meet on the trial.'"

See also United States v. Lowe, 7 Cir., 115 F.2d 596, 598; Aiken v. United States, 4 Cir., 108 F.2d 182; Bauman v. United States, 5 Cir., 156 F.2d 534, 536.

Counts two and three of the indictment here considered do not meet the test of the mail fraud cases, since no particulars whatever are set forth as to the scheme to defraud; the government's contention is that most of the mail fraud cases on the point were decided before the new Federal Rules of Criminal Procedure, 18 U.S.C.A., were enacted, and that the new rules favor simplified indictments. But several of the cited cases were decided after the enactment of the new rules. Furthermore the basic test of whether the indictment informs the defendant of what he will be required to meet at the trial, has not changed, and it is the opinion of this Court that counts two and three of the indictment fail to meet that basic test. The government's argument as to the effect of the new Federal Rules is also weakened by the fact that the Appendix of Forms drafted in conjunction with the Federal Rules of Criminal Procedure contains an illustrative form for a mail fraud indictment, Form 3, which includes particulars of the alleged fraudulent scheme. Therefore it is the conclusion of this Court that the settled rule of the mail fraud decisions is still effective, and that the same rule is applicable to the wire fraud statute upon which counts two and three are based.

Defendants move to dismiss count one of the indictment for failure to charge an offense. The motions are based upon the contention that count one charges a conspiracy to commit certain offenses, but does not describe with sufficient clarity the offenses which the defendants allegedly conspired to commit. Count one charges as follows:

"the defendants, at a time and place to the Grand Jury unknown, in violation of Title 18, United States Code, Section 371, did conspire together, and with other persons to the Grand Jury unknown to commit the following and each of the following offenses against the laws of the United States of America in that they did conspire:

"(a) in violation of Section 1343 of Title 18, United States Code, wilfully and knowingly to transmit sound by means of interstate wire for the purpose of executing a scheme devised by them for obtaining money by means of false and fraudulent pretenses, representations and promises,

"(b) in violation of Section 2314 of Title 18, United States Code, wilfully and knowingly to cause to be transported in interstate commerce money of the value of more than $5,000, knowing the same to have been taken by fraud.

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