United States v. Pike

• Decision Date: 06 December 1946
• Docket Number: No. 9004.,9004.
• Citation: 158 F.2d 46
• Parties: UNITED STATES v. PIKE et al.
• Court: U.S. Court of Appeals — Seventh Circuit

158 F.2d 46 (1946)

UNITED STATES v. PIKE et al.

No. 9004.

Circuit Court of Appeals, Seventh Circuit.

November 14, 1946.

As Corrected on Denial of Rehearing December 6, 1946.

Charles W. Hadley, of Wheaton, Ill., and John A. Nash and Arthur H. Schwab, both of Chicago, Ill., for appellants.

J. Albert Woll, U.S. Atty., and Bernard H. Sokol and Jack Arnold Welfeld, Asst. U.S. Dist. Attys., all of Chicago, Ill., for appellee.

Before SPARKS and KERNER, Circuit Judges, and BRIGGLE, District Judge.

BRIGGLE, District Judge.

This is an appeal from a judgment of the District Court after a jury found the defendants, Silas Elbert Pike and Ernest C. Pike, guilty of using the United States mails in a scheme to defraud in violation of Section 338, Title 18 United States Code Annotated, Sec. 215, Cr.Code. The trial court imposed a sentence of five years imprisonment and a fine of $1,000 on each of seven counts, sentences of imprisonment to run concurrently.

The scheme employed by the defendants originated and was operated from the city of St. Charles, Illinois. Using the trade name of "Sunnyside Gardens," the defendants conducted an extensive solicitation of sums of money by mailing millions of postal cards addressed to persons known to be flower lovers and interested in the cultivation of gardens. A method employed by the defendants was the sending of the following postal card:

"Dear Friend: As you are a flower lover we have a wonderful Free Offer to send you. Just cut your name and address from this card and send it to us with 8 postal cards each addressed to a flower lover, together with 2 dimes, and we will mail you a $1.00 Surprise Collection to get acquainted. Answering within 10 days gives you an opportunity to receive a Premium of 6 lovely Handkerchiefs and 25 beautiful Flowering bulbs together with our Catalog. Thanks to a friend who made it possible for you to have this information.

"Sunnyside Gardens, Box 215, St. Charles, Illinois.

"P. S. Answering within a few days will include 2 lovely house plants for promptness."

If a recipient complied with the instruction printed on the postal card, he would cut out of such postal card the part which bore his name on one side and the address of the Appellants on the reverse side, and send this by mail to appellants, with the sum of twenty cents and eight other blank postal cards stamped and addressed to his friends who were also interested in flowers. Immediately upon receipt at the defendants' building in St. Charles, these postal cards were placed in a mimeograph machine and the identical or a similar offer was printed on the back of each, and they were placed in the United States mails. Thereafter, four or five packets of seeds of various types were sent to some of those who had sent in their money and addressed postal cards; others received nothing at all. Recipients testified to having answered promptly but failed to receive the "premiums" indicated on the card.

The evidence indicated that the results obtained from planting the seeds were in many cases negative. Sometimes a seed produced a plant but usually it withered and died, although the recipients of the seeds were usually familiar with the cultivation of plant life, and were qualified to secure favorable results from the seeds if the same were reasonably obtainable.

In 1944 defendants sent with the seeds a slip of paper which read, as follows:

"Dear Customer: Due to war conditions the balance of your order will be sent later.

"You will positively receive it in due time."

The envelope containing the seeds had the following printed matter on the outside:

"Contents Merchandise

"Postmaster: This parcel may be opened for Postal Inspection if necessary

From Sunnyside Gardens, St. Charles, Ill Return postage guaranteed Information

"Your opportunity to receive a Premium of 6 lovely Handkerchiefs & 25 beautiful Flowering Bulbs.

"With any order for the following items will include 6 lovely Handkerchiefs and 25 beautiful Flowering Bulbs at no extra cost.

"No. 1 Will mail postpaid 15 assorted Hardy Irises roots for only $2.00.

"No. 2 Will mail postpaid 6 Magnificent Double Peony roots for only $2.00.

"No. 3 Will mail postpaid 9 assorted Cactus plants for only $2.00.

"The above offers are made for building new business. Satisfaction Guaranteed or money refunded. Send for our Catalog today.

Free Offer "Will send a Vitamin B-1 tablet Free Fragile."

None of the witnesses who testified received the handkerchiefs or flowering bulbs. One witness obtained a Vitamin B-1 tablet. It does not appear from the record whether any of the witnesses responded to the invitation to make a $2 purchase.

The scheme was conducted by the defendants, Silas Elbert Pike and Ernest C. Pike, with the assistance of members of their immediate family, Dorcas Pike, a sister, Stella Pike Nelson, a sister, and C. Kelly Nelson, a brother-in-law. No person, other than a member of the immediate family, held any position of authority. The chief responsibility for the operation of the scheme was that of the two defendants Each worked in the office, employed and supervised help, distributed the work to various assistants, and delivered and picked up mail at the post office at St. Charles, Illinois. Silas Elbert Pike operated the mimeograph machine.

Mail was received from the defendants under the trade style "Sunnyside Gardens" from 1940 until 1944. The defendants used various postoffice box numbers on their original postal cards, 215, 200 and 219, as part of their address when, in fact, they had no such postoffice boxes, and continued to use such numbers after a conversation with the postmaster about their impropriety. The cancelling machine records of the postoffice at St. Charles showed that in 1944, in a period of less than six months, the defendants mailed 2,979,000 postal cards. They received in a three-month period, April, May and June of 1944, approximately 5000 replies a day. Each such receipt contained either twenty cents, or a larger sum of money, and eight or ten postal cards. Two extra postoffice substitute clerks were employed at the postoffice at St. Charles, Illinois, to handle mail of the defendants alone. The Postoffice Department received numerous complaints from persons who had replied to the solicitation of the defendants, and as a result a postoffice inspector requested permission to visit the building at St Charles, from which the defendants operated the scheme. He visited the site on two occasions and was denied admission and information each time by the defendant Silas Pike.

No handkerchiefs or catalogs, such as are mentioned in the offer mailed by the defendants, were delivered to the postoffice at St. Charles for mailing and no handkerchiefs were ever available upon the premises of Appellants with which they could have fulfilled this portion of the "opportunity" offered. Few "house plants," such as are referred to in the postal card used by the defendants, were mailed by them prior to the visit of the postoffice inspector, and thereafter but 1200 plants were mailed. These so-called "plants" were mailed to the recipients either too late for planting or in such condition that they could not be cultivated. But 20 bulbs were mailed in 1944.

The building at St. Charles, Illinois, from which the Appellants operated bore no signs identifying the building. A passerby would not be able to discover that this was "Sunnyside Gardens" or otherwise identify it with the operations of the Appellants. The entrance was difficult to find, and the Appellants themselves were extremely secretive and a reluctant source of information. Defendants used mailing permits under the trade styles "Sunnyside Gardens" and "Pike Brothers." One witness testified that she had received a card containing an offer of some giant Darwin tulip bulbs for testing signed by "Pike Brothers," which offer had requested that she send in self-addressed postal cards. She addressed these cards with the names of flower lovers, one of whom was her...