Worthington v. United States, 4720.

• Decision Date: 10 June 1933
• Docket Number: No. 4720.,4720.
• Citation: 64 F.2d 936
• Parties: WORTHINGTON v. UNITED STATES.
• Court: U.S. Court of Appeals — Seventh Circuit

64 F.2d 936 (1933)

WORTHINGTON v. UNITED STATES.

No. 4720.

Circuit Court of Appeals, Seventh Circuit.

February 14, 1933.

Rehearing Denied June 10, 1933.

Walter W. Duft, of Chicago, Ill., for appellant.

George E. Q. Johnson, U. S. Atty., and Francis J. Kennedy, Asst. U. S. Atty., both of Chicago, Ill., for appellee.

Before ALSCHULER, EVANS, and SPARKS, Circuit Judges.

EVANS, Circuit Judge.

Many errors are assigned by appellant, which we will consider under separate headings.

The Indictment.

The sufficiency of the indictment is assailed because (a) none of the first five counts sets forth a scheme to defraud with sufficient clarity to inform appellant of the charges which he is to meet; (b) each count contains representations so different from the other that it can not be said that said representations were made pursuant to the same scheme to defraud, and therefore each count of the indictment is bad for duplicity.

It is stated in the rather lengthy first count (the allegations of which are appropriately adopted in the second, third, fourth, and fifth counts) that appellant and Freiburger "devised a scheme and artifice to defraud, and to obtain money and property by means of false pretenses, representations and promises from a class of persons then resident within the United States, to wit, those persons desirous of making profitable investments in real estate, lot contracts and judgment notes, hereinafter called persons intended to be defrauded, all of whom, by reason of their great number and from a lack of information on the part of the grand jurors are not susceptible of being separately named in this indictment, but who included among their number the following: * * *" (Thereafter follows the names of five persons whose addresses are given.) The indictment continues: "that the said scheme and artifice to defraud, and for the purpose of obtaining money by means of false pretenses, representations and promises was substantially as follows, to wit: * * *." Then follows a statement of the transactions whereby the victims were induced to part with their money and to invest the same in certain real estate ventures such as the Irrigated Farms Corporation, the Sheridan Shore Highland Subdivision, and the Moeller Sellers Development Company, a fig farm development enterprise in Arizona.

It was alleged that the fraud was consummated by having the said Freiburger represent that she "had no interest or relationship with the said Worthington" other than to see that the persons so intended to be defrauded made money through investments with appellant, and the said Freiburger further represented that she had made enormous profits out of her investments with appellant and that if the said victim delivered to said Worthington "large sums of money for investments" he would invest the same in the mentioned enterprises, which were in fact fraudulently conceived and without merit. Other acts and representations were attributed to appellant and his confederate whereby the victims were mistakenly led to believe that a down payment of part of the investment would yield such large returns that the balance of the purchase price would be paid out of the large profits arising out of the initial small down payment. While the allegations of the first count (repeated by adoption in the next four) might have, with propriety, more clearly negatived the verity of the representations and asserted more explicitly the unsoundness of the business enterprises into which appellant invested the victims' money, we feel the foregoing statement fairly describes the substance of the charge.

We can not say that the scheme to defraud set forth fails to inform the appellant with sufficient clarity to permit him to meet the proof of fraud and fraudulent intent which such charge necessitated. The scheme to defraud is, of course, an essential element of the offense charged. The gist of the offense, however, is the use of the mails, and it is therefore only essential to charge the scheme with such particularity as will enable the accused to know what he may be expected to meet on the trial. The details of such scheme need not be set forth with that particularity which would be required if it, rather than the use of the mails, were the gist of the offense. Redmond v. U. S. (C. C. A.) 8 F.(2d) 24; Cochran v. U. S. (C. C. A.) 41 F.(2d) 193; Cowl v. U. S. (C. C. A.) 35 F.(2d) 794; Mathews v. U. S. (C. C. A.) 15 F.(2d) 139; Havener v. U. S. (C. C. A.) 49 F.(2d) 196; Busch v. U. S. (C. C. A.) 52 F.(2d) 79; Horn v. U. S. (C. C. A.) 182 F. 721; Foster v. U. S. (C. C. A.) 178 F. 165; Brooks v. U. S. (C. C. A.) 146 F. 223; Savage v. U. S. (C. C. A.) 270 F. 14; Gardner v. U. S. (C. C. A.) 230 F. 575; McClendon v. U. S. (C. C. A.) 229 F. 523; Gould v. U. S. (C. C. A.) 209 F. 730.

Duplicity. From what has been said it is, we think, apparent that the indictment was not bad for duplicity. In determining whether a criminal charge, drawn under section 338, title 18, U. S. C. (18 USCA § 338), is bad for duplicity, it is necessary to differentiate between the scheme to defraud and the means adopted to effectuate the same. If the charge sets forth more than one scheme to defraud, it is duplicitous. If, however, there is but one general scheme to defraud and numerous means for effectuating the same, it is not bad for duplicity. Sconyers v. U. S., 54 F.(2d) 68 (C. C. A. 5); Sunderland v. U. S., 19 F.(2d) 202 (C. C. A. 8); Scheib v. U. S., 14 F.(2d) 75 (C. C. A. 7); McLendon v. U. S., 14 F.(2d) 12 (C. C. A. 5); Cowl v. U. S., 35 F.(2d) 794 (C. C. A. 8); Popham v. U. S., 11 F.(2d) 966 (C. C. A. 5); Silkworth v. U. S., 10 F.(2d) 711 (C. C. A. 2); Gourdain v. U. S., 154 F. 453 (C. C. A. 7).

A fair construction of the indictment convinces us that the grand jury merely charged one scheme to defraud and in addition described different ways of carrying it out.

The existence of several fraudulent ventures, into one of which an unsuspecting victim may be led, does not necessarily multiply the number of schemes to defraud. One possessed of a fraudulent scheme may set numerous traps into one of which he hopes and expects the unwary to walk. One victim may not be lured or tempted by a fig farm in Arizona and yet may fall for the prospective profits, captivatingly pictured, which might arise from the purchase, at a large discount, of an unsatisfied judgment. Still another unsuspecting victim may be induced to purchase a land contract for the sale of a lot in a subdivision at a reduced price, when he would not buy the lot at half that price. In short, the fraudulent scheme of the entrapper may be a single one, yet means to accomplish the fraud may be many.

Conspiracy. The jury found one of the two defendants charged with conspiracy guilty, and the other not guilty. This would be fatal even to the one found guilty Bartkus v. U. S., 21 F.(2d) 425, 427 (C. C. A. 7); Didenti v. U. S., 44 F.(2d) 537 (C. C. A. 9); Williams v. U. S., 282 F. 481 (C. C. A. 4); Grove v. U. S., 3 F.(2d) 965 (C. C. A. 4); Cofer v. U. S., 37 F.(2d) 677 (C. C. A. 5); U. S. v. Wray, 8 F.(2d) 429 (D. C.); Miller v. U. S., 277 F. 721 (C. C. A. 4); Feder v. U. S., 257 F. 694, 5 A. L. R. 370 (C. C. A. 2); Alkon v. U. S., 163 F. 810 (C. C. A. 1); Morrow v. U. S., 11 F.(2d) 256 (C. C. A. 8); Rosenthal v. U. S., 45 F.(2d) 1000, 78 A. L. R. 1415 (C. C. A. 8); U. S. v. Austin-Bagley Corporation, 31 F.(2d) 229 (C. C. A. 2) were it not for the allegation that said two defendants conspired "together, and with each other, and with divers other persons to the said grand jurors unknown." It takes the guilty action of at least two to effect a conspiracy.

However, the allegation to the effect that the two defendants conspired with other persons to the grand jury unknown, while affording the basis for determining what evidence is admissible and what evidence will support a conviction, when one of the two named defendants is found not guilty, is nevertheless an allegation which may be the subject of denial and refutation. In other words, a conspiracy may be established, even though one of the two parties named in the indictment as members thereof is not such a member, if the evidence shows that there are other persons in existence one or more of whom were parties to such conspiracy. But the evidence must show the existence of another person or persons who could take the place of the misnamed member of the conspiracy. The trouble with the record in the instant case is that the indictment named two persons, appellant and Freiburger, as the two conspirators. The jury found Freiburger was not a party to the conspiracy. The evidence fails to show any other person, to the grand jury unknown, who could take Freiburger's place and supply the necessary second party to the conspiracy.

The only person who could possibly have been a party to the conspiracy was one Meyers. He was, however, to the grand jurors known, and moreover, the evidence does not establish even a prima facie case of his participation in the alleged conspiracy.

Appellant's conviction on the conspiracy count, therefore, cannot be sustained.

Other assignments of error, save one, we pass with but brief mention as they may not again arise on a new trial which must be directed in view of the court's ruling rejecting certain evidence offered by appellant, which ruling we shall discuss presently.

We find no error in the trial court's refusal to grant appellant a bill of particulars; in calling Hamilton, an unwilling witness, as the court's witness; or in questioning witnesses produced by both sides. We fail to appreciate, and therefore reject, appellant's contention that he was compelled to testify against himself, or that it was erroneous to receive in evidence the books of the copartnership of Meyers & Worthington, of which appellant was a partner. The sufficiency of the evidence to support certain counts need not be considered in view of the possibility of other...