United States v. Skinner

• Decision Date: 31 December 1914
• Citation: 218 F. 870
• Parties: UNITED STATES v. SKINNER et al.
• Court: U.S. District Court — Southern District of New York

218 F. 870

UNITED STATES v. SKINNER et al.

United States District Court, S.D. New York.

December 31, 1914

[Copyrighted Material Omitted]

H Snowden Marshall, U.S. Atty., of New York City (R. L. Batts Sp. Asst. Atty. Gen., of Austin, Tex., Frank M. Swacker, Sp. Asst. Atty. Gen., of Washington, D.C., and Robert Stephenson, of New York City, of counsel), for the United States.

Sullivan & Cromwell, of New York City (Royall Victor and Clarke M. Rosecrantz, both of New York City, of counsel), for defendants Skinner and Elton.

Murray, Ingersoll, Hoge & Humphrey, of New York City, and Cummings & Lockwood, of Stamford, Conn., for defendant Billiard.

GRUBB District Judge.

This matter is submitted on the plaintiff's demurrers to the separate special pleas of each of the defendants, setting up, in bar of the prosecution, the immunity they claim to have received, because of evidence given by them before the Interstate Commerce Commission, with regard to the transactions which form the basis of the indictment.

The plaintiff's demurrers question the sufficiency of all the pleas upon two grounds. They are: (1) That the pleas fail to show that the testimony was given pursuant to the requirement by the Commission in a proceeding in which the Commission had the power to compel the attendance and testimony of witnesses and the production of documents, and for that reason was not given under legal compulsion, within the meaning of the immunity statute; and (2) that the witnesses did not assert their constitutional privilege of declining to answer, when sworn before the Interstate Commerce Commission, upon the ground that their answers would tend to incriminate them, and that their answers were not compulsory, in the absence of such an assertion of their privilege, and did not earn them the immunity conferred by the statute.

First. The power of the Interstate Commerce Commission to compel the attendance and testimony of witnesses and the production of documents embraces 'only complaints for violation of the act, and investigations by the Commission upon matters that might have been made the object of complaint. ' Harriman v. Interstate Commerce Commission, 211 U.S. 407, 29 Sup.Ct. 115, 53 L.Ed. 253.

On the one hand, the government's contention is that the purpose of the investigation, at which the defendants gave their testimony is shown by the recitals of the Senate resolution, requesting the Interstate Commerce Commission to make the same, to have related to no violation of the Interstate Commerce Act or its amendments or supplements, and to have been instituted at the instance of the Senate, and not upon complaint. The purposes of the investigation, so far as shown by the recitals of the Senate resolution, were to ascertain who were the beneficiaries of certain investments of the New York, New Haven & Hartford Railroad Company (the company under investigation) in the securities of other companies, as to whether such beneficiaries could be required to make restitution to the stockholders of the New Haven Company, as to whether the officers of the New Haven Company, responsible for the investments, and those receiving the benefits thereof, were amenable to punishment under existing laws, and what legislation the Commission might recommend, if any, to prevent the recurrence of the evil. It is quite clear that, if these recitals correctly state the only purposes of the investigation, the power of the Commission to compel the attendance and testimony of witnesses and the production of papers did not exist. It would not then relate to any specific violation of the act to regulate commerce or to matters that might have been the object of complaint before the Commission. Harriman v. Interstate Commerce Commission, 211 U.S. 407, 29 Sup.Ct. 115, 53 L.Ed. 253.

Upon the other hand, the defendants contend: That the investigation, at which they gave their evidence before the Commission, was the continuance of an investigation entered upon before the Senate resolution was enacted. That the original investigation was entitled: 'The New England Investigation. In the Matter of Rates, Classifications, Regulations and Practices of Carriers. ' That it was instituted upon complaints made to the Commission of such rates, regulations, and practices, and that its purpose was to investigate such rates, classifications, regulations, and practices, with a view to ascertaining whether specific violations of the act to regulate interstate commerce had occurred. The defendants contend that the reopened investigation, consequent upon the Senate resolution, was merely the continuance of the original investigation with the same purposes and character, and consequently within the class of investigations to effectuate which the Commission had the authority to compel testimony.

The character of the investigation is rather to be determined by its subject-matter, its scope, and the resulting order of the Commission awarding the relief, than by the title of the cause, on the one hand, or by the recitals of the Senate resolution requesting it, on the other. If the investigation was no broader than the recitals of the Senate resolution would indicate, no authority in the Commission to compel testimony existed. If the scope of the reopened investigation was broader than is indicated by the Senate resolution, and if the reopened investigation partook of the nature and character of the original investigation, then a different question would be presented-- one which would have to be solved by reference to the subject-matter of the reopened investigation, as determined by the evidence taken by the Commission, the order made upon it, and the entire proceedings. The pleas contain no such exhaustive statement of the proceedings before the Commission as would enable the court to intelligently pass upon the question. It may be that the court takes judicial notice of them, in such sense as to have the benefit of them in determining the question upon demurrer.

The conclusion I have reached upon the other ground of de demurrer does not make a decision of this ground imperative to a ruling on the demurrer to the pleas; and for that reason, and because of the unsatisfactory condition of the pleas in this respect, so far as they relate to the first point, no conclusion on that ground is expressed.

Second. The second ground of demurrer to the pleas is that they fail to aver that the defendants asserted their constitutional privilege of silence upon the hearing before the Interstate Commerce Commission. The sufficiency of this ground is to be tested by the construction of the act of Congress which, it is claimed, confers immunity upon the defendants. This is the act of February 11, 1893. The plaintiff and the defendants differently construe the language of the act. The plaintiff contends that the words, 'No person shall be excused from attending and testifying, or from producing books, etc., before the Interstate Commerce Commission, etc., on the ground or for the reason that the testimony or evidence, documentary or otherwise, required of him, may tend to incriminate him or subject him to a penalty or forfeiture, ' designate as a class those who present their excuse upon this ground before the tribunal, which exacts of them their testimony, and are nevertheless required to give it. To this class, and it only, according to the plaintiff's contention, does the subsequent clause, which confers the immunity, apply, viz.:

'But no person shall be prosecuted or subjected to a penalty or forfeiture for or on account of any transaction, matter or thing concerning which he may testify or produce evidence, documentary or otherwise, before said Commission, or in obedience to its subpoena, or the subpoena of either of them, or in any such case or proceeding.'

On the other hand, the defendants' contention is that the function of these same words is to make inapplicable to proceedings before the Commission, or causes in the courts, involving violations of the act to regulate interstate commerce and its amendments or supplements, the fifth amendment to the Constitution, and the privilege of silence conferred by it, and so to provide that all persons, who testify before the Commission or in proceedings in the courts based on violations of the act, are immune from prosecution by reason of the subsequent clause in the act, regardless of whether they asserted their constitutional privilege of silence on the hearing. The solution of the question depends upon which of these two constructions is the correct one.

The language of the act is perhaps ambiguous. Certain it is that the authorities have differed as to the proper construction of this and similar acts. The authorities construing section 860 of the Revised Statutes are easily to be distinguished. That section is so framed as to make an assertion of the constitutional privilege impracticable with reference to at least some of its provisions. As an illustration, the provision protecting disclosures in pleadings. Again, statutes, the only effect of which is to deprive the government of the use of testimony elicited, and not to confer immunity on the witness testifying against prosecution for any crime concerning which the testimony related, are not so drastic as those conferring such immunity. The government, under the former, at most only loses the benefit of evidence which it could not have otherwise obtained, while, under the latter, it loses the right to prosecute, although it might be able to prosecute with success without the use of the privileged testimony.

In the statute construed in the case of People of New York v Sharp, 107 N.Y. 427, 14 N.E. 319, 1 Am.St.Rep. 851, there were two provisions, one analogous to section 860 of the ...