United States v. Werner

• Decision Date: 01 April 1947
• Docket Number: Docket 20389.,No. 112,112
• Citation: 160 F.2d 438
• Parties: UNITED STATES v. WERNER et al.
• Court: U.S. Court of Appeals — Second Circuit

160 F.2d 438 (1947)

UNITED STATES v. WERNER et al.

No. 112, Docket 20389.

Circuit Court of Appeals, Second Circuit.

April 1, 1947.

J. Bertram Wegman and Richard J. Burke, both of New York City (Myron L. Shapiro, of New York City, of counsel), for Kohn.

Louis Halle, of New York City, for Werner.

Keith Brown and John F. X. McGohey, U. S. Atty., Southern District of New York, both of New York City (William Koerner, of New York City, of counsel), for appellee.

Before L. HAND, AUGUSTUS N. HAND and CLARK, Circuit Judges.

L. HAND, Circuit Judge.

The defendants, Werner and Kohn, were convicted of having possession with guilty knowledge of four cases of razor blades, which had been stolen from a warehouse in New York City, and were moving in foreign commerce.¹ On this appeal they raise six questions: (1) whether the evidence of guilty knowledge was enough to support the verdict; (2) whether the judge charged the jury adequately concerning circumstantial evidence; (3) whether he erred in excluding testimony as to the fair market value of the blades at the time the defendants bought them; (4) whether the blades were moving in foreign commerce when they were stolen; (5) whether they were stolen from one of those places prescribed in the statute; (6) whether they were embezzled and were not on that account within the meaning of the statute. The facts, as the jury might have found them from the evidence, were as follows. In April, 1944, the Personna Blade Co. Inc., of Plattsburg, New York, made a contract with the British "Ministry of Supply Mission" to make and deliver for the British armed forces approximately a thousand gross of razor blades, at $12 a thousand. The Personna Company was to make the blades especially for this contract and was to deliver them at a warehouse at Kingsbridge, New York City, properly cased and marked and ready for export to various places abroad; but the "Supply Mission" reserved the privilege of examining them to see that they corresponded with the specifications. The difficulties of shipment were such that cases might remain in the warehouse at Kingsbridge for periods of time, amounting to six weeks or more, before an opportunity arose to forward them abroad. The Personna Company shipped the four cases in question by truck to Rensselaer, New York, where they were turned over to a second carrier, who took them to its terminal in New York, whence they were to be delivered to Kingsbridge by a third carrier. For some reason not disclosed, after reaching the second carrier's terminal, they were not taken to Kingsbridge, but were delivered with other merchandise to the warehouse of J. & M. O'Neill, Inc., on Beekman Street, New York. Whether this misdelivery was a theft, or resulted from mistake, does not appear.

A man named Cannet was O'Neill's receiving clerk, and after examining the first case, he stored all four in the warehouse, made no entry of their arrival in O'Neill's records, and told no one in the company that they had been received. On the 9th, he gave a sample package of the blades taken out of the first case to Moresco, a truck driver for another trucker; and Moresco took this sample to the defendant, Werner's warehouse. Moresco had delivered merchandise to Werner in the past, and he offered to sell him the blades at prices at which Werner later bought them and which averaged a little more than $4.50 a thousand. He told Werner that the cases were an overshipment; and when Werner asked him whether they had been stolen, said they had not been. Werner at first refused to buy them himself, but he called up the defendant, Kohn on the telephone and told him that he could sell him Personna blades for $6 a thousand. Kohn, who did a wholesale drug business in Newark, said he would buy them, and would go to New York the next day to take delivery. On May 10th, Kohn drove to Werner's place in New York and examined the blades in three cases. They were like ordinary razor blades, and unlike the Personna Company's blades on the American market, which were of much higher quality and sold for $50 a thousand. Werner and Kohn agreed upon a price of $5.75 a thousand; Kohn opened the cases, counted the cartons, and took two cases back to Newark in his motor car. An employee of Werner went with him, to whom he paid $710.50 in cash for all three cases; and on the same day Kohn returned to New York and got the third case. On the 11th, Moresco delivered the fourth case to Werner, who sold it to Kohn on the 12th and he paid for it this time by cheque.

Kohn and his father immediately set about selling the blades. They sold about 44,000 for $12 or $16 a thousand; and tried to sell the remaining 100,000 at auction in Newark, at a minimum price of $16 a thousand. In this they were unsuccessful, and on the 20th Kohn undertook to sell the blades to the Personna Company itself through one of its employees, Marcus, with whom he was acquainted. Marcus wished to get the blades off the market because, being inferior, he feared that they would hurt the sale of the high quality Personna blades; so he asked Kohn to rebuy from the retailers those which he had sold, and offered to pay $25 a thousand for them. Marcus then went to Newark, and examined the blades which Kohn still had; and in answer to his inquiry Kohn told him that they had been honestly acquired, assuring him that he had bills of sale for all of them, which was of course false. Apparently by the 24th Marcus learned that the blades had been stolen; at any rate he replevied more than 100,000 on behalf of the Personna Company; Kohn at once informed Werner; and on the same day they both had an interview in a restaurant with Cannet — whom neither had as yet met — and with Moresco — whom Kohn had never met. Kohn and Werner demanded a bill of sale or a way-bill to prove that the blades had not been stolen; and told Cannet and Moresco that with such documents in hand they might be able to recover $25,000 from the Personna Company because of the suit. They added that a bill of sale was "just a piece of paper," and Kohn said that its production "was the only thing that would save them." Again, on June 3rd, they called up Cannet and tried to get him to give them a bill of sale. He refused, and Werner then threatened him with disclosure.

If the case against Kohn had depended only upon the circumstances of his purchase of the cases from Werner, it might be argued with some show of plausibility that there was not enough evidence of guilty knowledge to support the verdict, although the transaction was certainly suspicious. However, if the jury chose to believe Cannet's and Moresco's testimony about the interviews after Marcus had replevied the cases, they were certainly justified in finding that, at least by that time, both Kohn and Werner were aware that the goods had been stolen. The fabrication of false documentary evidence, which they then suggested to Cannet, has from the earliest times been treated as strong evidence of guilt.² Moreover, as to Kohn there was the added testimony that he had falsely asserted to one of the retailers and to Marcus that he had bills of sale for the cases. If it be answered, that this evidence did not relate back to the time when Kohn received the cases, there are two answers. First, the jury might well conclude that nothing had happened after Kohn had received the cases, to open his eyes, and that they might therefore relate back his knowledge. Second, the statute is in the alternative: it defines the crime as either receiving, or possessing, goods with guilty knowledge, and even though the goods had been innocently received, when Kohn later learned that they had been stolen and retained them, he committed the crime.

The evidence against Werner was stronger. He started with the presumption against him always attending the possession of recently stolen property;³ and he neither took the stand, nor offered any evidence in his favor. On the other hand several of the witnesses upon cross-examination by his counsel testified to exculpatory matters; and perhaps that relieved him of the presumption. It would seem a rigorous requirement to demand for that result that evidence must be formally designated as part of the case of the party against whom the presumption operates. However that may be, and even though we assume that the testimony we mention did relieve Werner of the presumption, there was evidence enough to charge him with guilty knowledge. Although he had lost possession of the goods, at the time of the interview with Cannet and Moresco, as in the case of Kohn, the jury might relate back to his guilt which he then disclosed; and, besides that, the circumstances of his original purchase were alone enough to support the verdict. Moresco was a truckman and truckmen do not honestly become the owners of cases of goods worth $800 which they peddle about without any documents of title. That Werner had already become suspicious appears from his question to Moresco when he bought; and that suspicion was too readily allayed by the assurance, with nothing to back it up, that a friend of Moresco, who was a receiving clerk, had the cases as "over" delivery. Nobody but a child would have been so fobbed off.

The defendants ask us to distinguish between "knowing" that goods are stolen and merely being put upon an inquiry which would have led to discovery; but they have misconceived the distinction which the decisions have made. The receivers of stolen goods almost never "know" that they have been stolen, in the sense that they could testify to it in a court room. The business...