United States v. Mousley

• Decision Date: 29 January 1962
• Docket Number: Crim. No. 20633.
• Parties: UNITED STATES of America v. William A. MOUSLEY and Mae E. Mousley.
• Court: U.S. District Court — Eastern District of Pennsylvania

201 F. Supp. 510

UNITED STATES of America v. William A. MOUSLEY and Mae E. Mousley.

Crim. No. 20633.

United States District Court E. D. Pennsylvania.

January 29, 1962

Drew J. T. O'Keefe, U. S. Atty., by Edmund E. De Paul, Asst. U. S. Atty., Philadelphia, Pa., for plaintiff.

Robert M. Taylor, William Jay Leon, Philadelphia, Pa., for defendants.

WOOD, District Judge.

I. HISTORY OF THE CASE

The defendants were jointly indicted by a Grand Jury on nine counts charging various acts of evading Federal income taxes. The case was tried before a jury. The trial lasted over fourteen days. The Government's exhibits numbered more than 206 and the defendants' exhibits were 31 in number. There were approximately 75 witnesses. The notes of testimony were not transcribed. Both at the conclusion of the Government's evidence and at the conclusion of the defendants' evidence, the defendants moved for judgments of acquittal. These motions were denied and the case was submitted to the jury. The jury found both defendants guilty on each of the nine counts. Within due time thereafter the defendants made the motions presently before us.

The motion in arrest of judgment attacks the sufficiency of the indictment, charging that it does not state facts sufficient to constitute an offense against the United States. Counts I through IV charge the willful attempts to evade the payment of income taxes due and owing for the years 1942 through 1946 by filing with the Government false statements of properties owned pursuant to various offers in compromise. They also charge the filing of a false application for discharge of property from a Federal Tax Lien. Count V charges perjury under 26 U.S.C.A. § 7206 (1) by the filing of a United States Treasurer's Form No. 433, a statement of financial condition. Counts VI through IX charge willful attempts to evade income taxes for the years 1954 through 1957 by the filing of false and fraudulent tax returns.

Prior to trial the defendants filed a motion to dismiss Counts I through IV of the indictment and a motion for a bill of particulars as to Counts VI through IX of the indictment. Both motions were denied by the Court on May 17, 1961 (United States v. Mousley, D.C., 194 F.Supp. 119 (1961)). At that time we considered the sufficiency of the various counts of the indictment and determined that all counts stated facts sufficient to charge an offense against the United States. We also considered and ruled against the defendants' contention that the statute of limitations barred Counts I through IV. We have reconsidered our rulings made therein but find no new argument or reason to persuade us to change our opinion. Therefore, the motion in arrest of judgment will be denied.

With regard to the defendants' motions for judgments of acquittal or for a new trial, we may summarize their contentions briefly as follows:

First, the defendants argue that there was insufficient evidence of willful acts on the part of the taxpayers for the jury to find them guilty of criminal evasions. Since the notes of testimony were never transcribed, as mentioned before, it is impossible for us to pick out the numerous instances of evidence of willfulness. Suffice it to mention evidence of the use of straw parties as record titleholders of properties which in fact defendants controlled, omission of many of these and other properties from statements filed in connection with offers of compromise, and the number of years and occasions involved upon which defendants understated their income and/or their assets. The jury properly concluded from this evidence that the defendants were criminally responsible for the acts charged.

Second, with regard to the years 1954 through 1957 and Counts VI through IX of the indictment, the defendants contend that the trial judge should have ruled as a matter of law that the unreported taxable income charged by the Revenue agent to the defendants from various properties was not income from properties "owned" by the defendants. Defendants' brief discusses these properties piece by piece on pp. 12 through 16. However, we think that all of the evidence concerning these properties was for the jury to believe or disbelieve and to evaluate under proper instructions from the Court as to whether the defendants did in fact receive profits therefrom. The jury having performed that function, we shall not disturb its findings as to these counts.

Third, defendants argue that the testimony of the witness Klotz, who reconstructed the actual income of the defendants as distinguished from the reported income, was incorrect. It is our clear recollection that he based the items on definite facts proved by the Government. Furthermore, the jury was carefully instructed that if they thought that this expert Government witness, in arriving at his conclusions, used facts which the Government had not proven beyond a reasonable doubt, they...