United States v. Wechsler

WINTER, Circuit Judge

(dissenting):

I agree wholeheartedly that one of the general purposes of Congress in the enactment of 18 U.S.C.A. § 1952 was “to deny the use of facilities in interstate commerce to those who would effect a wrong on the people by corrupting public officials.” But in seeking to punish this class of wrongdoers, the government must be held to the exact class of transgressors whose activities Congress outlawed. To my mind, these defendants do not fall into this group.

The facts need not be extensively restated ; only certain dates should be pointed up. The $5,500 bribe to accomplish favorable rezoning of the tract in question was removed from escrow and deposited to Somers’ bank account on August 18, 1961. The next day it went into Leigh’s bank account. From there, shares were disbursed to the three public officials who accomplished the rezoning. Specifically, one of them, Bell (who was acquitted at the trial) received a check in payment on August 22, 1961; Leigh, one of the others, made disbursement to himself on August 23, 1961; and the final payment was made to a third, Cotten, by check dated September 9, 1961. Cotten’s bookkeeper did not deposit Cotten’s check until September 15, 1961. Meanwhile, § 1952 became effective September 13, 1961. Because the initial rezoning was set aside by the courts’ repetition of the rezoning, but without the payment of any additional bribe, took place in June and July, 1962. In connection with the second rezoning, the United States mails were used on June 17 and 18 and on July 21, 1962.

The statute, which was the basis of the substantive count of the indictment and the violation of which was the object of the alleged conspiracy in the conspiracy count of the indictment, is set forth in the margin. 1 So far as pertinent here, the statute makes unlawful the conduct of one who uses any facility in interstate or foreign commerce, including the mail, with intent to promote, *350 manage, establish, carry on, or facilitate the promotion, management, establishment or carrying on of bribery in violation of the laws of the Commonwealth of Virginia and thereafter performs or attempts to perform the crime of bribery in violation of those laws. The Virginia statutes defining the criminal conduct constituting bribery are likewise set forth in the margin. 2 It is clear under Virginia law, as the majority tacitly concedes, that the latest point in time at which the crime of bribery is complete is not when the public official commits the act for which he is bribed, but when the bribe is given and the official accepts the bribe payment. 3

The essential difference between me and the majority is that I think that the statute means what it says when it requires that the use of interstate facilities be accompanied by an intent to violate state law. Both United States v. Wingo (6 Cir. 1967), and United States v. Kubacki, 237 F.Supp. 638 (E.D.Pa. 1965), support this position. 4 But in contravention of these authorities — and *351 the plain language of § 1952 — the majority apparently deems that use of interstate facilities in the loose context of some past violation of state law is sufficient, if subsequent conduct of the defendants can be said to violate the general purpose of § 1952 to protect the people from corruption of public officials.

The error of the majority is one of statutory interpretation, but as such it reaches constitutional magnitude. Under the operative facts as stated by the majority and repeated here, there can be no question (putting aside for the moment the check given to Cotten) but that the Virginia crimes of bribery and acceptance of a bribe were “complete and completed” prior to September 13, 1961— the effective date of § 1952. As will be later shown, the check given to Cotten requires no different conclusion. If the government had sought a conviction on the basis of the use of interstate facilities prior to September 13, 1961, so as to prove such use accompanied by the intent which § 1952 specifically requires, clearly the government would be seeking to give § 1952 retroactive application. 5 This the government could not do. U.S. Constitution, Art. I, § 9; Bouie v. City of Columbia, 378 U.S. 347 , 84 S.Ct. 1697 , 12 L.Ed.2d 894 (1964). In allowing the government to circumvent this problem by reliance on uses of interstate facilities occurring after September 13, 1961, the majority has denied due process of law, because it has created by judicial fiat a federal crime not brought into existence by § 1952 itself, “the use of interstate facilities with intent to pro *352 mote an illegal zoning.” Such judicial enlargement of a penal statute, if applied retroactively, has the same effect as legislative enactment of an ex post facto law, which is constitutionally prohibited both to the states and to Congress (U.S. Constitution, Art. I, §§ 9 and 10), and has been held to violate the due process amendments. Bouie v. City of Columbia, supra. Because any use of interstate facilities to promote an illegal zoning was federally innocent — even if it occurred after September 13, 1961 — before the majority’s decision in this case, the violation of due process follows.

Any doubt about the construction to be afforded § 1952 is allayed by reference to Kann v. United States, 323 U.S. 88 , 65 S.Ct. 148 , 89 L.Ed. 88 (1944), and Parr v. United States, 363 U.S. 370 , 80 S.Ct. 1171 , 4 L.Ed.2d 1277 (1960), both of which arose under the mail fraud statute. In Kann the defendants perpetrated a fraudulent scheme, pursuant to which they obtained checks payable to them, which they cashed or deposited at a bank. The use of the mails charged as a violation of the federal statute was the mailing of the checks for collection by the banks which cashed them to the banks on which they were drawn. Prior to that mailing, the defendants had obtained effective control over the money which they sought and, as far as they were concerned, their fraudulent plan had reached its fruition and come to a complete rest. The mailing was done by the banks, which had no connection whatsoever with the fraud. The checks were mailed for the bank’s own purposes. On these facts it was held that the defendants could not be convicted for violation of the mail fraud statute, because the mailing did not occur with the requisite intent to defraud.

In Parr the defendants obtained gasoline and other products and services for themselves by the use of a credit card of a School District which had authorized the defendants to use the card for the District’s purposes only. The mailings complained of were two invoices sent by the oil company to the District, and the District’s check mailed back in payment. Again, it was found that the mailings by the outsiders were not an integral part of the scheme as planned and executed by the defendants, and that, as a matter of fact, it was completely immaterial to them what the oil company did about collecting its bill. As in Kann , the conclusion reached was that the mailing was without the requisite intent to further the scheme to defraud.

Both Kann and Parr clearly stand for the proposition that the mere concurrence of a violation of the general purpose which the relevant federal statute is designed to serve and a use of interstate facilities does not make an act, even though morally reprehensible and violative of state law, a federal crime. That Congress may have prohibited the use of interstate facilities to persons who use those facilities for the purpose of perpetrating frauds does not mean that Congress intends to outlaw that activity under federal law wherever the use of interstate facilities grants to the federal courts a jurisdictional basis to do so. Cf. Carroll v. United States, 326 F.2d 72, 85-86 (9 Cir. 1963). In this regard the following statement in Kann is quite pertinent: “The federal mail fraud statute does not purport to reach all frauds, but only those limited instances in which the use of the mails is a part of the execution of the fraud, leaving all other cases to be dealt with by appropriate state law.” 323 U.S., at 94-95 , 65 S.Ct. at 151 .

Similarly, as shown by the clear statutory language, Congress did not intend in § 1952 to reach all wrongs “on the people [effected] by corrupting public officials,” but only those wrongs which are violative of specified state laws. The scope of Congressional power and whether it is sufficiently broad to make unlawful the use of interstate facilities for the purpose of corrupting state officials, is not the question. I do not doubt that the power of Congress is this broad, just as I do not doubt that Congress can reach all fraudulent schemes which employ interstate facilities regardless of intent. *353 But our Inquiry here must be whether this power was so exercised. The plain wording of § 1952 demonstrates that it was not.

The check sent to Cotten merits special scrutiny. If the bribery of Cotten was complete on September 9, the date on which he received the check, it is obvious that under my interpretation of the statute, the clearing of the check through interstate facilities after September 13 could not constitute a violation of § 1952, because (1) this use of interstate facilities could not be made with the requisite intent to violate state law, and (2) no act in performance or attempted performance of the Virginia crime of bribery could be made after the use of interstate facilities, as required by § 1952. This, I think, is dispositive of the case. In the absence of evidence that Cotten knew that the check was worthless at the time he received it and delayed in making his deposit until he was informed that the check would not “bounce” (a position suggested, but not pressed by the government) there seems to be no reason to find as a matter of state law that the bribe was not completed on the date of receipt. 6 It would be unrealistic to infer repudiation of the check from mere delay in depositing it when the check was received pursuant to a prior agreement.

Assuming, however, that the bribe was not completed at the time of receipt, it seems abundantly clear that it was completed at the time of deposit. By placing the money in his own account, Cotten evidenced an unequivocal intent to “accept” the illicit benefit, the gravamen of the offense under Va.Code Ann. § 18.1-279. Surely, a public official could be convicted of bribery if he accepted counterfeit money, believing it to be genuine. Similarly, even if a check which he accepted turned out to be worthless, he would still have accepted a bribe. Thus, collection of the check from the drawee bank occurred after the bribe had been completed — even if the bribe was not accepted until the time of deposit — and, accordingly, any use of interstate facilities after that time, specifically bank clearing operations, could not constitute a violation of § 1952 for the same reasons which apply if the bribe is deemed to have been completed on September 9.

But even if it is further assumed that as a matter of state law the bribe was not completed until the check had cleared, the same result should obtain, because as a matter of federal law the bank clearing operations do not constitute a use of interstate facilities as contemplated by § 1952. The specific teaching of Kann v. United States, supra, is that if the interstate mailing is merely collateral to the perpetration of a fraudulent scheme, such mailing is not sufficient to establish a violation of the mail fraud statute. Of course, subsequent decisions, e. g., United States v. Sampson, 371 U.S. 75 , 83 S.Ct. 173 , 9 L.Ed.2d 136 (1962), and Pereira v. United States, 347 U.S. 1 , 74 S.Ct. 358 , 98 L.Ed. 435 (1954), recognize that, under the mail fraud statute, use of the mails even after the victim’s money has been obtained can be for the purpose of executing the scheme, and thus subject to prosecution, if it is “incidental to an essential part” of the scheme. But on whatever side of the rather vague line drawn by Kann and its progeny the bank clearing in the instant case might fall, an important difference in the mail fraud statute and § 1952 supplies a dispositive answer. The mail fraud statute proscribes conduct where one “knowingly causes” the mail to be used for the purpose of executing the fraud, as well as use of the mail for that purpose. 18 U.S.C.A. § 1341 . It was on the ground that each of the defendants “caused” the mail to be used that convictions were upheld in Pereira v. United States, supra, where the basis for prosecution was the deposit of checks. By contrast, § 1952 is limited to “uses [of] any facility in interstate or foreign commerce, includ *354 ing the mail.” Therefore, the reasoning used in Pereira to limit the Kann holding is not applicable here.

In the expression of my views, little more need be stated. If I am correct in my interpretation of § 1952, the convictions on the substantive counts clearly cannot be supported. And if I am correct in my treatment of the substantive offenses, the conspiracy convictions, under the familiar principle that a conspiracy terminates upon the accomplishment of its unlawful objective, stand on no surer footing. Grunewald v. United States, 353 U.S. 391 , 77 S.Ct. 963 , 1 L.Ed.2d 931 (1957).

I would reverse the judgments and direct the entry of judgments of acquittal.

. 18 U.S.C.A.

Ҥ 1952. Interstate and foreign travel or transportation in aid of racketeering enterprises

(a) Whoever travels in interstate or foreign commerce or uses any facility in interstate or foreign commerce, including the mail, with intent to—

(1) distribute the proceeds of any unlawful activity; or

(2) commit any crime of violence to further any unlawful activity; or

(3) otherwise promote, manage, establish, carry on, or facilitate the promotion, management, establishment, or carrying on, of any unlawful activity, and thereafter performs or attempts to perform any of the acts specified in subparagraphs (1), (2), and (3), shall be fined not more than $10,000 or imprisoned for not more than five years, or both.

(b) As used in this section ‘unlawful activity’ means (1) any business enterprise involving gambling, liquor on which the Federal excise tax has not been paid, narcotics, or prostitution offenses in violation of the laws of the State in which they are committed or of the United States, or (2) extortion, bribery, or arson in violation of the laws of the State in which committed or of the United States.

* * * * * »

. 4 Code of Virginia (1960 Repl. Vol.):

“§ 18.1-278. Bribes to officers or candidates for office. — If any person corruptly give, offer or promise to any executive, legislative or judicial officer, sheriff or police officer, or to any candidate for such office, either before or after he shall have taken his seat, any gift or gratuity, with intent to influence his act, vote, opinion, decision or judgment, on any matter, question, cause or proceeding, which is or may be then pending, or may by law come or be brought before him in his official capacity, he shall, upon conviction, be confined in the penitentiary not less than one nor more than ten years. This section shall also apply to a resident of this State who, while temporarily absent therefrom for that purpose, shall make such gift, offer or promise and thereafter return to this State.

* * * * * **

“§ 18.1-279. Acceptance thereof by officer. — If any executive, legislative or judicial officer, sheriff or police officer, or any candidate for such office, accept in this State, or if, being resident in this State, such officer or candidate shall go out of this State and accept and after-wards return to and reside in this State, any gift or gratuity or any promise to make a gift or do any act beneficial to such officer or candidate under an agreement, or with an understanding, that his vote, opinion or judgment shall be given on any particular side of any question, cause or proceeding which is or may be by law brought before him in his official capacity or that in such capacity he shall make any particular nomination or appointment or take or fail to take any particular action or perform any duty required by law, he shall, upon conviction, be confined in the penitentiary not less than one nor more than ten years and shall forfeit his office and be forever incapable of holding any post mentioned in § 2-26. The word candidate as used in this and the preceding section shall mean anyone who offers himself or is put forward by others as a suitable person or an aspirant for such office.”

. Of course, the Virginia statute also permits a prosecution based on events which occur earlier than the completed transaction, i. e., the offer to give a bribe, and the agreement to accept one. Ford v. Commonwealth, 177 Va. 889 , 15 S.E.2d 50 (1940). For present purposes, however, my concern is properly directed only to the latest point in a complete transaction that criminality attaches.

. The “background identification” language in Kubaclci, quoted in the majority opinion, must be placed in its proper context. It was not held in Kubaclci, as the majority holds here, that it is unnecessary in determining whether § 1952 has been violated to examine the specific scope of the state law which the defendant is charged with having the intent to violate when using facilities of interstate commerce. To the contrary, an essential element of the holding in Kubaclci is that under Pennsylvania law the crime of extortion is not completed until the actual payment is made, and that this payment was made after September 13, 1961. See 237 F.Supp. at 643 n. 7. The reasoning of the court was that although the public wrong effected by the extortion — the award of a parking meter contract — occurred before the effective date of § 1952, the illicit course of conduct under state law was not completed until the actual payment was made, and that, therefore, the use of facilities of interstate commerce after September 13 was made with the requisite intent to violate state law. Thus, the court stated:

“Upon the adoption of §, 1952 on September 13, 1961, the plan, contemplat *351 ing as it did use of interstate facilities and interstate travel, became an unlawful conspiracy under federal law. Membership of the defendants in the theretofore federally innocent plan was then converted to membership in an unlawful conspiracy. That conspiracy continued until the accomplishment of the last of its objects, delivery of the money and the clock. Id., 237 F.Supp. at 643 . (emphasis supplied)

The italicized language makes it clear that after the state crime of extortion had been completed by the making of the actual payment, the conspiracy to violate § 1952 must also necessarily terminate. Similarly, United States v. Wingo, (6 Cir. 1967), provides no support for the majority’s approach of defining “unlawful activities” as used in § 1952 in federal terms, rather than according to state law. Indeed, in that case, which involved “travel in interstate commerce” to distribute the proceeds of prostitution, the Court explicitly recognized that “we are concerned by the terms of the statute [§ 1952] with an enterprise unlawful under the laios of Tennessee." Id. And although the Court paraphrased the “background identification” language used in Kubacki , the context in which these words are used indicates that the Court meant something far different from what the majority suggests.

“At this point it becomes necessary to determine what the Travel Act requires in the form of intent. Under § 1952, travel, with a requisite intent plus a subsequent act in furtherance of that intent, would be all that is required to make out a violation. United States v. Bergland, 318 F.2d 159 (7 Cir. 1963) cert. den., Cantrell, et al v. United States, 375 U.S. 861 , 84 S.Ct. 129 , 11 L.Ed.2d 88 (1963). The state crimes serve only as a background identification of the unlawful activities in aid of which the proscribed travel loas undertaken. United States v. Kubacki, 237 F.Supp. 639 (E.D.Pa., 1965). The words ‘with intent’ obviously refer to the words immediately following, namely ‘to * * * distribute the proceeds of any unlawful activity.’ ” (emphasis supplied)

The difference in the “intent” required in Wingo and that required here is explained simply by the fact that the indictments in Wingo were brought under § 1952(a) (1), while the indictments in the instant case were brought under § 1952 (a) (3). For present purposes, the critical aspect of the language in Wingo is that the Court considered that state law provides “background identification” to § 1952(a) (1) only in the sense that the gravamen of the federal offense is the use of interstate facilities with the intent to distribute the proceeds of an unlawful activity, defined by state laio.

. As particularized, the indictment charges that the use of interstate facilities by use of the United States mails between the Commonwealth of Virginia and Washington, D. C. occurred on or about September 20, 1961, October 11 and 12, 1961, October 22, 1961, November 28, 1961, and July 17 and 18, 1962.

. Indeed, the record shows that Leigh, contemporaneously with drawing his check to Cotten, voided certain previously drawn checks so that the cheek to Cotten would be paid by the bank when presented.