Opposition — Brown v. United States

No. 75-1597

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In the Supreme Court of the United States

OCTOBER TERM, 1°74

JoHN H. BROWN AND JOHN W. CURINGTON, PETITIONERS

Vv.

UNITED STATES OF AMERICA

ON PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE FIFTH CIRCUIT

BRIEF FOR THE UNITED STATES IN OPPOSITION

RoBerT H. Bork,

Solicitor General,

RICHARD L. THORNBURGH,

Assistant Attorney General,

JEROME M. Felt,

IVAN MICHAEL SCHAEFFER,

Attorneys,

Department of Justice,

Washington, D.C. 20530.

In the Supreme Court of the United States

OcTOBER TERM, 1976

No. 75-1597

Joun H. BROWN AND JOHN W. CURINGTON, PETITIONERS

Vv.

UNITED STATES OF AMERICA

ON PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE FIFTH CIRCUIT

OPINION BELOW

The per curiam opinion of the court of appeals

(Pet. App. A-I to A-3) is reported at 525 F. 2d 1256.

JURISDICTION

The judgment of the court of appeals was entered

on January 15, 1976, and a petition for rehearing was

denied on March 4, 1976. On March 23, 1976, Mr.

Justice Powell extended the time for filing a petition

for a writ of certiorari to May 3, 1976, and the petition

was filed on that date. The jurisdiction of this Court

is invoked under 28 U.S.C. 1254(1).

QUESTIONS PRESENTED

1. Whether the district court erred in denying

petitioner's motion to suppress evidence allegedly ob-

tained by illegal electronic surveillance conducted by

private individuals.

2. Whether pre-indictment delay deprived petitioners of

due process of law.

(1)

2

3. Whether the government's alleged failure to disclose

certain evidence to the defense deprived petitioners of

a fair trial.

STATEMENT

Following a jury trial in the United States District

Court for the Northern District of Texas, petitioners

were convicted on three counts of mail fraud, in vio-

lation of 18 U.S.C. 1341. Imposition of sentence was

suspended and petitioners were placed on three years’

probation on condition that they pay their victim res-

titution in the amount of $2,501.40. Petitioners were

also fined $!,000 on each count. The court of appeals

affirmed per curiam (Pet. App. A).

|. The evidence at trial established that petitioners,

former employees of the Hunt Oil Corporation (“Hunt

Oil”), defrauded HLH Products (*HLH™”), a division of

Hunt Oil, by establishing a brokerage firm to receive

fees for servicing an HLH account when no such fees

had in fact been authorized by Hunt Oil or HLH and

no services were actually rendered by petitioners (Pet.

App. A-1).

HLH Products owned and operated food processing

plants in different areas of the country. Petitioner

Brown was employed by HLH as its sales manager,

while petitioner Curington was in charge of the company’s

day-to-day operations (Tr. 465-466). In December 1967,

petitioner Brown met with James Burkett, an institutional

sales representative for HLH, and asked Burkett whether

he would like to establish a food brokerage business in

the Chicago area. When Burkett assented. petitioner

Brown instructed Burkett to set up a company in

Chicago. but cautioned him not to use his own name or

his home address in connection with the company.

Burkett then founded an Illinois corporation named D.

Buckingham’s. Ltd. (Tr. 482-496).

3

On September 9, 1968, petitioner Brown wrote a

letter to H. L. Hunt, principal stockholder of Hunt

Oil, stating that he had met recently with the chief

buyer of canned vegetables for Topco Associates and

that the buyer had “suggested that we pay brokerage

on their purchases to Buckingham, Ltd.” (Tr. 470-471).

Petitioner Brown advised acquiescing in, the request for

‘fear of losing the Topco account if the brokerage were

not paid (ibid.). In fact. no such meeting had taken place,

no request to pay br... erage was ever made by Topco,

and Topco’s buyer had never heard of D. Buckingham’s,

Ltd. (Tr. 567-568, 634-635, 816). On September 17, 1968,

petitioner Brown wrote letters to D. Buckingham’s,

Ltd., and to the billing department of Hunt Oil, informing

them that Buckingham’s was to receive a commission of

three percent on all Topco purchases as of September |,

1968 (Tr. 472-473). Thereafter Hunt Oil forwarded

monthly brokerage checks to D. Buckingham’s, Ltd.,

although that company provided no brokerage services

in connection with Topco or any other account. The

proceeds from those brokerage checks, which ranged

from $525 to $2,217.32 per month, were delivered to

petitioners and others by Burkett (Tr. 527-528). Peti-

tioners also took several precautions to maintain the

secrecy of their fraudulent operation (Tr. 499, 506-508,

572-578).

In March 1969, following an annual meeting of stock-

holders, Tom Hunt, an employee of Hunt Oil and nephew

of H. L. Hunt, began an investigation into substantial

financial losses being suffered by HLH (Tr. 774-775,

845). Petitioner Curington tried, without success, to

prevent Hunt from visiting HLH plants and speaking

with employees during this investigation (Tr. 846-850).

At the same time, petitioner Brown requested and

received Burkett’s resignation from HLH “because of

an investigation that [Tom Hunt] had begun in Dallas

4

regarding HLH Products” (Tr. 516-517). In August

1969. petitioner Brown wrote a letter to D. Buck-

ingham’s, Ltd., cancelling the brokerage agreement

(Tr. 525-526).

2. Petitioners testified in their defense and acknowledged

forming a brokerage firm that provided no services to

HLH. They claimed, however, that H. L. Hunt, who

died in November 1974 (four months after the indict-

ment and four months prior to trial), had authorized

them to supplement their salaries by engaging in such

conduct (Ir. 723, 732-736, 800-806). Petitioners pro-

duced three letters, purportedly signed by H. L.

Hunt. authorizing them to engage in “personal business

transactions,” granting petitioner Curington a lifetime

employment contract, and prohibiting any member of the

Hunt family from inquiring at any time into any

“outside business activities” of petitioners (Tr. 716-722).

On cross-examination of petitioner Curington and in

rebuttal, the government established that H. L. Hunt

had been known to practice his signature before signing

actual documents, that he would leave the practice

signatures “lying any place.” and that in 1971 he had

unequivocally denied having signed or authorized the

letters offered by petitioners (Tr. 787-788, 855, 857).

ARGUMENT

|. Petitioners’ primary contention (Pet 12-14) is

that the government's evidence at trial was tainted by

unlawful electronic surveillance undertaken by private

persons and should have been suppressed pursuant to

18 U.S.C. 2515. However, both lower courts correctly

concluded that the government’s proof was not directly

or indirectly attributable to any illegal wiretapping,

and this finding of fact does not warrant further re-

view. See Berenvi v. Immigration Director, 385

U.S. 630. 735: Graver Mfg. Co. v. Linde Co., 336 U.S.

271. 275.

5

Within a few months after the commencement of Tom

Hunt's investigation into HLH’s financial losses, suspicions

focused on petitioners and another employee, Paul

Rothermel. After the three men had resigned from the

company in November 1969, Tom Hunt and his cousin,

William Herbert Hunt, retained Dale Simpson, president

of a Dallas detective agency, to assist in the investigation

(Tr. 136-137). The Simpson investigation continued for

a year and a half and resulted in a massive report,

which was turned over to Hunt Oil (Tr. 199-200). Even-

tually, the report became the starting point for the federal

investigation that culminated in petitioners’ indictment.

Meanwhile, in January 1970, illegal wiretaps were

discovered on the telephones of petitioners, Rothermel,

Tom Hunt, and another officer and employee of Hunt

Oil. These wiretaps had been installed on instructions of

H. L. Hunt's sons, William Herbert and Nelson Bunker

Hunt, who were subsequently indicted for their authori-

zation of electronic surveillance. Jon Kelley, one of the

wiretappers, testified at a hearing in the district court

that on one occasion when he delivered tapes of the over-

heard conversations to the Hunt brothers, William Herbert

Hunt had stated: “We need to get this information to

Simpson” (Tr. 305).

Based on this statement and on the assertion that the

government's denial of taint “does not comport with reason

or experience” (Pet. 13), petitioners allege that the Simp-

son report was infected with information gained from the

unlawful electronic surveillance ordered by William

Herbert and Nelson Bunker Hunt and that the govern-

ment’s proof at trial, much of which was indirectly

traceable to the report, should have been suppressed. At

an evidentiary hearing held in the district court, however,

the government clearly satisfied its burden of establishing

that none of the information on which its investigation

6

was based. and none of its evidence at trial, had been

derived in any way from the illegal wiretaps. For example,

Tom Hunt, with whom Simpson principally dealt, testified

that he never turned over wiretap information to Simpson

and that the evidence discussed in the Simpson report

had been gathered from the Hunt Oil Company files,

which contained a wealth of incriminating documents

(Tr. 137-138). Simpson, an auditor, and another person

who worked with Simpson on the investigation also

testified that they had no knowledge of the wiretaps and

did not receive any information derived from them

and that their report was grounded almost exclusively on

a study of company records (Tr. 172-203, 211-228,

235-273). Furthermore, an F.B.1. agent who investigated

the illegal wiretaps testified that he had found no

evidence that Simpson had been aware of the taps

(Tr. 345). As the court of appeals remarked (Pet. App.

A-2):

{Petitioners’] allegations [of taint] * * * are totally

unsupported by any direct evidence in the record;

at trial a number of people who worked on the Simp-

son report, including Mr. Simpson himself, denied

that they had ever received any information from the

illegal wiretaps. Furthermore, there was a substantial

amount of testimony establishing that the Simpson

report was compiled almost exclusively from business

records kept by the [petitioners] themselves —a source

wholly free from any taint of illegality. It is thus clear

that the government carried its burden of proving

that the evidence at issue here was derived from an

independent source, * * * and that consequently the

district court did not err in denying [petitioners’]

motion to suppress.

2. Petitioners contend (Pet. 14-16) that the government's

delay in bringing criminal charges against them deprived

them of due process of law. Specifically. petitioners allege

=

/

that they were prejudiced by the government's failure to

return an indictment until July 1974, four months before

the death of H. L. Hunt. who they assert “could have

potentially tipped the balance in Petitioners’ favor” (Pet.

15).

It is undisputed that the indictment was returned within

the applicable statute of limitations, which is “the primary

- guarantee against bringing overly stale criminal charges.”

United States v. Ewell, 383 U.S. 116, 122. Moreover,

petitioners have not shown that “the pre-indictment delay

* * * caused substantial prejudice to * * * [their right]

to a fair trial and that the delay was an intentional device

to gain tactical advantage over [them].” United States v.

Marion, 404 U.S. 307, 324 (footnote omitted).' It was not

until July 1973, in connection with the prosecution of

William Herbert and Nelson Bunker Hunt, that the govern-

ment first became aware of the possible mail fraud

violations by petitioners. An inquiry wi immediately

begun by a postal inspector, and the indictment was

returned in less than a year. Indeed, petitioners do not

allege that any delay was intentional or was designed

to hinder their defense.

Petitioners’ claim of prejudice due to H. L. Hunt's death

is similarly insubstantial. Petitioners and Hunt all appeared

before the grand jury on June 19, 1974, at which time the

deteriorating condition of Hunt’s health was readily appar-

ent to petitioners and their counsel (R. 252-253).? The in-

dictments against petitioners were returned three weeks

'The government's petition for a writ of certiorari in United States

\. Lovasco, No. 75-1844, presents the question whether it is

sufficient for a defendant who seeks dismissal of an indictment

because of pre-indictment delay to satisfy either. rather than both,

branches of the Marion test. Since petitioners have satisfied neither

branch, there is no reason to hold this case pending disposition

of the petition in Lovasco.

“RO refers to the record on appeal in the court of appeals.

8

later. Although H. L. Hunt lived for four more months,

petitioners never sought to take his deposition under Rule

1S5(a). Fed. R. Crim. P., nor did they move for a speedy

trial (Tr. 332). In fact, trial was originally scheduled for

November 18, 1974, shortly before Hunt’s death, but was

postponed because of petitioners’ request for an extension

of time in which to file pretrial motions (Tr. 327). Peti-

tioners’ conduct was thus wholly inconsistent with their

present claim that H. L. Hunt's testimony was crucial to

their defense-—a claim that is, in any event, highly suspect

on the record in this case.

3. Petitioners claim (Pet. 16-18) that they were denied

a fair trial because the government suppressed an allegedly

exculpatory statement by Paul Rothermel, a former Hunt

Oil employee. that H. L. Hunt had been aware of the Buck-

ingham brokerage arrangement and had approved of peti-

tioners’ supplementing their income through “side deal-

ings.” Petitioners contend that this statement had been

made to I.R.S. Agent Gene Boren in 1971, but was not

turned over to them until the final day of trial, following the

close of the evidence (R. 339-348).

This allegation was fully explored and rejected by the

district court, which found, after a hearing, that Rothermel’s

statement had been in the possession of the defense prior

to trial (R. 420-422). Indeed, not only had petitioners

received a copy of the statement before the close of testi-

mony in the case (R. 376-377), but also petitioners’ counsel

was expressly advised by the government during trial that

Rotherme!l had once made certain remarks favorable to

the defense. Nonetheless, petitioners determined not to

call Rothermel as a witness because of their doubts as to

his credibility (R. 378). In addition, the record indicates

that petitioners independently learned of the existence

and substance of the Rothermel statement more than three

months betore trial. when Agent Boren testified at a pre-

trial hearing that he had interviewed petitioner Curington

and Rothermel in March 1971 and that both men had told

9

him that H. L. Hunt had authorized the outside business

activities in question. Agent Boren further testified that

Rothermel’s statements had been recorded. transcribed,

and preserved in summary form and were available from

the I.R.S. files (R. 422-425).

As this Court recently indicated in United States v.

_Agurs, No. 75-491, decided June 24, 1976, slip op. 12,

n. 16, quoting from Giles v. Marvland, 386 U.S. 66, 98

(Fortas, J., concurring), there is no duty to disclose mater-

ial “otherwise known to the defense.” See also United

States v. Ross, 511 F. 2d 757, 763 (C.A. 5), certiorari

denied, 423 U.S. 836: cf. Rosenberg v. United States, 360

U.S. 367, 369-370; United States v. Ruggiero, 472 F. 2d

599, 604 (C.A. 2), certiorari denied, 412 U.S. 939. Here,

even though petitioners were fully aware of the Rothermel

statement, the government called it to petitioners’ atten-

tion and supplied them with a copy of it during trial. The

district court therefore correctly concluded that the govern-

ment did not violate its obligations under Brady v. Mary-

land, 373 U.S. 83.

~ CANCLUSION

It is respectfully submitted that the petition for a writ

of certiorari should be denied.

ROBERT H. Bork,

Solicitor General.

RICHARD L. THORNBURGH,

Assistant Attorney General.

JEROME M. FEIT,

IVAN MICHAEL SCHAEFFER,

Attorneys.

Jury 1976.

DOJ-1976-07