United States v. Rosenberg

• Decision Date: 15 October 1945
• Docket Number: No. 8.,8.
• Citation: 150 F.2d 788
• Parties: UNITED STATES v. ROSENBERG et al.
• Court: U.S. Court of Appeals — Second Circuit

150 F.2d 788 (1945)

UNITED STATES v. ROSENBERG et al.

No. 8.

Circuit Court of Appeals, Second Circuit.

July 17, 1945.

Writ of Certiorari Denied October 15, 1945.

Henry G. Singer, of Brooklyn, N. Y. (Sol L. Firstenberg, of New York City, on the brief), for appellant Rosenberg.

M. M. Kreindler, of New York City (Abraham S. Robinson and Sol L. Firstenberg, both of New York City, and Harry Silver, of Brooklyn, N. Y., on the brief), for appellant Freier.

M. M. Kreindler, of New York City (Sol L. Firstenberg, of New York City, on the brief), for appellants Ferenc Weisz, Ernest Weiss, and Irene Weisz.

Sol L. Firstenberg, of New York City (M. M. Kreindler, of New York City, on the brief), for appellant Friedman.

Harry E. Kreindler, of New York City (M. M. Kreindler and Sol L. Firstenberg, both of New York City, on the brief), for appellant Eisler.

Vine H. Smith, Asst. U. S. Atty., of Brooklyn, N. Y. (Milo F. McDonald, U. S. Atty., of Brooklyn, N. Y., on the brief), for appellee.

Before SWAN, CHASE, and CLARK, Circuit Judges.

Writ of Certiorari Denied October 15, 1945. See 66 S.Ct. 90.

CLARK, Circuit Judge.

The seven defendants herein were convicted under the usual conspiracy statute, 18 U.S.C.A. § 88, of conspiring to export platinum without a license, in violation of Presidential Proclamation 2413, 54 Stat. 2712, 3 CFR, Cum.Supp., 164, issued pursuant to Section 6 of the Act of July 2, 1940, 54 Stat. 714, 50 U.S.C.A. Appendix, § 701. They were indicted with two others, of whom one eventually pleaded guilty and became a witness for the prosecution at the trial, and the other obtained a severance. These defendants demurred to the indictment on several grounds, of which those still most pressed are that the statute is unconstitutional, as an improper delegation of legislative power to the executive, and that the prosecution is unauthorized because the statute by its terms had expired prior to the trial. But the District Court overruled the demurrers in a reasoned opinion, D.C.E. D.N.Y., 47 F.Supp. 406, and upon their conviction after a month's trial before a jury gave each of them a substantial sentence of both fine and imprisonment. This appeal followed.

Before considering the claimed errors at the trial, we shall dispose of the important issues of law stated above. The constitutional objection is based upon the grant of authority to the President to prohibit the export of munitions or supplies of war whenever he "determines that it is necessary in the interest of national defense" to do so.¹ Panama Refining Co. v. Ryan, 293 U.S. 388, 55 S.Ct. 241, 79 L.Ed. 446, stated limits to the power of Congress to delegate its legislative powers to the President; and A. L. A. Schechter Poultry Corporation v. United States, 295 U.S. 495, 55 S.Ct. 837, 79 L.Ed. 1570, 97 A.L.R. 947, and United States v. Butler, 297 U.S. 1, 56 S.Ct. 312, 80 L.Ed. 477, 102 A.L.R. 914, held unconstitutional grants of authority to the executive to formulate both policy and the applicable standard. There is some thought that these precedents have lost vigor of recent years; be that as it may, we are clear that they do not apply here, for the statute does itself define policy and set a definite standard. This was part of an extensive statute "to expedite the strengthening of the national defense," 54 Stat. 712, passed just after the fall of France, when the invasion of England appeared imminent. Those were days of fear and stress for us, as well as for our later allies; that Congress, having defined the policy of prohibiting or curtailing supplies needed for defense, could not leave to the Chief Executive, the Commander in Chief of the Army and Navy, the time and detail of its execution would surely seem a harsh, impractical rule, and one more strict than the precedents support. Kiyoshi Hirabayashi v. United States, 320 U.S. 81, 102, 103, 63 S.Ct. 1375, 87 L.Ed. 1774; National Broadcasting Co. v. United States, 319 U.S. 190, 216, 63 S.Ct. 997, 87 L.Ed. 1344; United States v. Randall, 2 Cir., 140 F.2d 70; United States v. Von Clemm, 2 Cir., 136 F.2d 968, 970, certiorari denied 320 U.S. 769, 64 S.Ct. 81, 88 L.Ed. 459. Moreover, the delegation of authority may be upheld on another ground, that of the traditional dominance of the Executive in the conduct of foreign affairs. The statutes involved in the Schechter and Butler cases dealt with purely internal affairs, while the statute here in issue provided for "national defense" by regulating "exportation" of war munitions, and thus concerned very vitally this country's relations with foreign nations. In fact the leading case which points out the President's greater power over the conduct of international affairs and freedom from restriction to an extent not permitted in internal matters, United States v. Curtiss-Wright Export Corporation, 299 U.S. 304, 322, 57 S.Ct. 216, 81 L.Ed. 255, cited as examples of such power the early acts of 1794 and 1795, 1 Stat. 372, 401, 444, authorizing the President to lay, regulate, and revoke embargoes and to permit the exportation of arms and military stores, notwithstanding statutory prohibitions. See also Panama Refining Co. v. Ryan, supra, 293 U.S. 388, 422, 55 S.Ct. 241, 79 L.Ed. 446; United States v. Bareno, D.C. Md., 50 F.Supp. 520, 522, 523; United States v. Kertess, 2 Cir., 139 F.2d 923, certiorari denied Kertess v. United States, 321 U.S. 795, 64 S.Ct. 847, 88 L.Ed. 1084; McDougal and Lans, Treaties and Congressional-Executive or Presidential Agreements: Interchangeable Instruments of National Policy, 54 Yale L. J. 181, 244-255, 1945. We do not doubt the validity of the statute.

Next as to the claim that all prosecution must cease on June 30, 1942, when, according to its terms, the original statute expired, we think the answer not at all in doubt. Though the trial was had in the fall of 1942, the alleged acts of conspiracy occurred between February and July, 1941. And on June 30, 1942, Congress enacted what it termed an amendment to this very statute, extending its date of expiration to June 30, 1944, and providing even further that it should remain in effect thereafter for the purpose of sustaining any prosecution under it.² Defendants contend vigorously, however, that, notwithstanding this plain assertion of legislative intent, the later act is not an amendment, but a new and substitute statute which cannot be read so as to extend the old provisions. But they fail to suggest any persuasive ground for this contention. True, because of this country's entry into the war, Congress thought it wise to broaden the President's powers so as to remove all boundaries from the category of articles subject to export control. But it did not alter the earlier penalties. See United States v. Borden Co., 308 U.S. 188, 60 S.Ct. 182, 84 L.Ed. 181; Posadas v. National City Bank of New York, 296 U.S. 497, 56 S.Ct. 349, 80 L. Ed. 351. And it seems absurd to contend that Congress, in extending the scope of the Act, meant those who violated the earlier, more limited statute to escape prosecution. True, the later statute also specifically designated the Board of Economic Warfare as the agency of control. But this, too, was neither new nor repugnant to the earlier statute. For the President as early as September 15, 1941, had instructed the Board to "exercise and perform all powers and functions * * * under section 6 of the act of July 2, 1940." Executive Order 8900, 3 CFR, Cum.Supp., 1009; see United States v. Bareno, supra.³ Actually the 1942 Act simply continued the then existing system of administration. It must be read as postponing the date of expiration of the 1940 Act and as authorizing the present prosecution. This was the conclusion not only of the learned judge below, but also of Judge Kennerly in United States v. 251 Ladies Dresses, D.C.S.D. Tex., 53 F. Supp. 772, and United States v. 8 Automobiles, D.C.S.D. Tex., 53 F.Supp. 775.⁴

The claimed errors at the trial require consideration of the evidence for the prosecution. On February 1, 1941, defendants Rosenberg and Freier met with the coconspirators Hersch Neumann, Abe Neumann, and Arnold Weisz at the office of a friend at 50 Pine Street, New York City, and discussed generally the possibility of profitably exporting platinum to Europe. So Hersch Neumann, with the knowledge and approval of this group, sent a cablegram to the Lisbon house of Salzberg & Alt to ascertain the price of platinum and whether "there is any market to sell platinum"; and to this he received a favorable reply. Then the brothers Hersch and Abe Neumann, together with Rosenberg, took an office in the office building at 50 Pine Street. Thereafter between February and May, 1941, the conspirators made four shipments of platinum by boat to Lisbon, Portugal. The general pattern followed by the conspirators was the purchase of platinum from precious metal dealers in New York; the forwarding of platinum to Lisbon by bribing members of the personnel of ships plying between that port and New York to carry the packages secretly; the sale of the metal in Lisbon or Zurich, Switzerland, by Salzberg & Alt; and distribution of the proceeds among at least some of the coconspirators. During all this time the conspirators were well aware that they required a license to export platinum, since they had been so advised by dealers from whom they made their purchases and with whom they signed agreements that the metal was for domestic consumption only.

After the first shipment to Portugal, Abe Neumann, Hersch Neumann, Freier, Rosenberg, Arnold Weisz, Koppel (the defendant who pleaded guilty), and Irene Weisz met and decided to take some platinum to Canada. Thereafter Koppel, Arnold Weisz, Freier, Rosenberg, and the two Neumanns contributed funds for the purchase of 120 ounces of platinum; and Abe Neumann, Arnold Weisz, and Irene Weisz took part of the purchase to "Ernest Weiss's place to give it over to him," where it was packed by Ferenc Weisz in a suitcase...