Petition — Gross v. United States

Supreme Court, be

eee

Ocroser Term, 1975

No. 05-1785

NELSON G. GROSS,

Petitioner,

UNITED STATES OF AMERICA,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

—_—

Bernarp G. Seaa,

James D. CrawrorD,

Sonnaper, Harrison, Seaat & Lewis,

1719 Packard Building,

Philadelphia, Pennsylvania 19102,

Attorneys for Petitioner.

Adams Press Corp., 11 Commerce Street, Newark, N. J. 07102—(201) 623-8611.

TABLE OF CONTENTS

PAGE

Opinions BELow "

JURISDICTION ~

CONSTITUTIONAL Provisions AND STATUTES INVOLVED ..

QuEsTIONS PRESENTED “

> wo nwo wo

STATEMENT a

ARGUMENT:

1. By arguing its case in a piecemeal fashion,

the government has successfully been able to

advance two mutually contradictory positions

to justify the use against petitioner of the

Fifth Amendment plea of his alleged co-

conspirator, despite the fact that neither

theory would have been constitutionally ac-

ceptable had both been argued at the same

time 9

2. If McCrane’s sworn statement that he never

told petitioner of any plans to plead the

Fifth Amendment does not conflict with

Preis’ testimony that petitioner knew Mc-

Crane would so plead, then petitioner is en-

titled to a new trial because evidence of

McCrane’s Fifth Amendment plea was er-

roneously admitted as corroborating Preis’

testimony m 12

li TABLE OF CONTENTS

3. If McCrane’s affidavit—which was not avail-

able at the time of petitioner’s trial—does

conflict with Preis’ critical testimony that

petitioner was aware that McCrane planned

to invoke the Fifth Amendment, then peti-

tioner is entitled to a new trial on grounds

of after-acquired evidence

CoNCLUSION “

APPENDIX:

Opinion of the United States Court of Appeals

BT Te TI cecethieccininnishsetsaninieesecicncaninnectins

Judgment of the United States Court of Ap-

peals for the Third Circuit -.....2...22........:.---c000-

Order Denying Petition for Panel Reheuring ......

Order Denying Petition for Rehearing ................

Opinion of the United States District Court for

the District of New Jersey ................-.-0--c--ce-e0---

Affidavit of Joseph M. McCrane, Jr. ....................

Excerpts from Transcript of Proceedings ............

Testimony of Doris Perla ......................-.-.--

Affidavit of J. Robert Lunney, Esq. ......................

Letter dated April 17, 1973 from United States

Attorney to Grover C. Richman, Jr. Esq. ........

Letter dated April 17, 1973 from Grover C. Rich-

man, Esq. to United States Attorney ................

Letter dated February 28, 1974 from Judge

Schoch to Kenneth P. Zauber, Esq. ..................

PAGE

18

S2a

=

TABLE OF CONTENTS

PAGE

Opinion of the United States Court of Appeals

for the Third Circuit 83a

Judgment of the United States Court of Appeals

for the Third Cireuit 89a

Order of the United States Court of Appeals

Denying Petition for Rehearing 9la

Cases Cited

Amos v. United States, 218 F.2d 44 (D&C. Cir.

1954) 19

Bruton v. United States, 391 U.S. 123 (1968)... 15

Commonwealth v. DuVal, 453 Pa. 206 (1973)............. 16

Commonwealth v. Terenda, 451 Pa. 116 (1973)..._... oo:

Grunewald v. United States, 353 U.S. 391 (1957)..10, 13, 15

Kinser v. Cooper, 413 F.2d 730 (6th Cir. 1969)... 16

Ledet v. United States, 297 F.2d 737 (5th Cir.

1962) : 19

Newsom v. United States, 311 F.2d 74 (5th Cir.

1962) 19

Pointer v. Texas, 380 U.S. 400 (1965) 17

SanFratello v. United States, 340 F.2d 560 (5th

Cir. 1965) 16

Seott v. Perini, 439 F.2d 1066 (6th Cir. 1971)... 16

United States v. Hale, 422 U.S. 171 (1975) 13, 14

United States v. Meyers, 484 F.2d 113 (3d Cir.

1973) 19, 20

iv TABLE OF CONTENTS

PAGE

United States Constitution Cited

Fifth Amendment 2-7, 9-21

Sixth Amendment ‘a ...d, 4, 16, 17

Statutes Cited

Corrupt Practice Act ........ 20

28 U.S.C.:

See. 1254(1) ........ a 2

Rule Cited

F.R.Cr.P

ee snmeun 7

IN THE

Supreme Court of the United States

Ocroser Term, 1975

No.

— oe

NELSON G. GROSS,

Petitioner,

v.

UNITED STATES OF AMERICA,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

Nelson G. Gross petitions for a writ of certiorari to

review the judgment of the United States Court of Ap-

peals for the Third Circuit entered in the above case on

April 22, 1976.

Opinions Below

As of the date of preparation of this petitie~, neither

the order of the United States Court of Appeals for

the Third Circuit denying petitioner’s Petition for Re-

2

hearing (25a) and the opinion of that court (83a),

nor the opinion and order of the United States District

Court for the District of New Jersey (26a) is reported.

This case was originally decided on May 15, 1974, in the

United States District Court for the District of New

Jersey and the Opinion of the court is reported at 375

F.Supp. 971. The United States Court of Appeals for

the Third Circuit subsequently affirmed the conviction

on February 19, 1975, on an opinion reported at 511 F.2d

910 and denied petitioners’ Petition for Rehearing on

April 2, 1975. This court denied certiorari on Novem-

ber 3, 1975, reported at 44 U.S.L.W. 3258.

Jurisdiction

The judgment of the Court of Appeals was entered on

April 22, 1976. A Petition for Rehearing was timely filed

on April 28, 1976, and was denied on May 11, 1976.

The jurisdiction of this Court is invoked under 28

U.S.C. 1254(1).

Constitutional Provisions and Statutes Involved

The Fifth Amendment of the Constitution of the United

States provides:

No person ... shall be compelled in any criminal

case to be a witness against himself, nor be de-

prived of life, liberty, or property, without due

process of law ... No person shall be held to an-

swer for (an) ... infamous crime unless on a pre-

sentment or indictment of a grand jury.

3

The Sixth Amendment of the Constitution of the

United States provides:

In all criminal prosecutions, the accused shall

enjoy the right to a... public trial, by an impar-

tial jury ..., to be informed of the nature and

cause of the accusation [and] to be confronted with

the witnesses against him...

Questions Presented

1. Where the government used the Fifth Amendment

plea of an alleged co-conspirator against petitioner, the

defendant in a criminal case, may it take contradictory

positions to justify the admission of that evidence simply

in order to make its case agree with the facts before the

court at the time?

2. Where the Fifth Amendment plea of petitioner’s

alleged co-conspirator has been admitted against peti-

tioner solely on the basis of the argument that the plea

corroborated the testimony of the chief witness against

petitioner, must not petitioner be granted a new trial upon

the government’s assertion that the Fifth Amendment plea

may well not have been corroborative at all?

3. Assuming that the Fifth Amendment plea of peti-

tioner’s alleged co-conspirator retained some value as

corroborative evidence, is not petitioner entitled to a new

trial because the co-conspirator has now become avail-

able for the first time to testify that his plea was made

without consultation with or knowledge of petitioner?

4

Statement

This petition raises the question of whether the United

States may, without violating the Fifth and Sixth Amend-

ments, use against a defendant in a criminal case the fact

that his alleged co-conspirator when questioned about the

central facts of the conspiracy, claimed his Fifth Amend-

ment right to remain silent. More specifically, it raises

the question of whether the government, having originally

argued successfully that the co-conspirator’s Fifth Amend-

ment plea was properly introduced as corroboration of

the testimony of its chief witness may now sustain the

resulting conviction despite its repudiation of the cor-

roboration theory in the affidavit of the co-conspirator that

completely contradicted the facts which formed the basis

for the corroboration theory.

Reduced to its simplest terms, the charges in this case

are that petitioner, together with Cahill finance director

Joseph MecCrane, had induced W'iliam Preis, the president

of Triple S Blue Stamp (Stop and Save) Company, to

make a lawful $5000 corporate contribution to the William

Cahill gubernatorial campaign in New Jersey by provid-

ing the corporation the means to treat the contribution as

a tax-deductible business expense through the use of an

invoice of a public relations firm called Writers Asso-

ciates. Thereafter, petitioner was alleged to have per-

suaded Preis to lie to the federal grand jury investigating

the Cahill campaign. According to Preis, his admitted

perjury had been induced by the statement of petitioner

that Preis could safely lie to the grand jury since he

could not possibly be found out unless petitioner or his

alleged co-conspirator McCrane were to testify against

him “[aJnd I happen to know that Joe MecCrane is going

to plead the Fifth when he comes up for his hearing . . .”

(Tr. 2009). The government then introduced, over peti-

oe ee eee somes s:

5

tioner’s objection, testimony that McCrane did appear be-

fore the grand jury and, when questioned whether he had

directed “anyone to issue false and fictitious invoices from

Writers Associates . . . Stop and Save Company .. .”

claimed his Fifth Amendment right to silence (Tr. 2862).

In support of the use of the Fifth Amendment plea over

the objection of petitioner’s counsel, the United States At-

torney argued both in advance of the introduction of the

Fifth Amendment plea (Tr. 2753-61), on the morning of

the day the plea was introduced (Tr. 2764-66, 2781-85),

during the introduction of the guilty plea testimony itself

(Tr. 2855-64), and his summation to the jury (e.g., Tr.

4801-02) that the McCrane Fifth Amendment plea could

be introduced as evidence of the conspiracy and to cor-

roborate the testimony of the witness Preis. (The pages

of the trial transcript cited above are attached hereto as

Exhibit A).

In affirming petitioner’s conviction, the court of appeals

had specifically rejected petitioner’s argument that the

McCrane Fifth Amendment plea was used against him

as the declaration of a co-conspirator. Instead, it had

held that the district court “in the proper exercise of its

discretion, admitted the evidence, with the appropriate

cautionary instructions, for the specific and limited pur-

pose of corroborating Preis’ unobjected to testimony that

petitioner had said: ‘And I happen to know that Joe Me-

Crane is going to plead the Fifth when he comes up for

his hearing .. .’ (Tr. 2009, 2632, 2779-81, 2863-64). Be-

cause the Court did not admit this evidence under the

co-conspirator’s exception to the hearsay rule, we fail to

see how this prejudiced appellant.” (511 F.2d at 916-17

(footnote omitted) ).

Petitioner’s case on direct appeal was argued in the

court of appeals on the very day on which his co-conspira-

6

tor, Joseph McCrane was acquitted of the counts in the

indictment against him which paralleled the charges

against petitioner. As a result, MeCrane became avail-

able as a witness for petitioner and offered his affidavit

to establish that the McCrane Fifth Amendment plea did

not serve to corroborate the testimony of the witness

Preis. Rather McCrane swore that he was prepared to

testify on behalf of petitioner that:

At no time prior to my assertion before the

Grand Jury on April 27, 1973, of my right not to

testify on Fifth Amendment grounds, did I ever tell

Nelson Gross that I would assert such a plea. In-

deed, until April 21, 1973, well after Gross’ pur-

ported statement to Preis, I had not discussed with

my attorneys or anyone else what action I would

take if I were to be called before the Grand Jury.

In fact, I was out of the country on a vacation when

a Grand Jury subpoe.a was served upon my wife

on April 6, 1973, and I did not return to the coun-

try so that I could discuss this matter with anyone

until April 21, 1973.

(Affidavit of Joseph McCrane, p. 4, Exhibit B to the Peti-

tion for Rehearing in No. 74-1694, Exhibit B to the Mo-

tion for New Trial, and Exhibit B attached hereto).

The court of appeals having affirmed his conviction,

petitioner sought rehearing, arguing that this new sworn

testimony destroyed the government’s only justification

for the admission of the McCrane Fifth Amendment

against petitioner and the court of appeals’ basis for af-

firming his conviction. The court of appeals ruled with

respect to these matters:

2. Points 2, 9 and 10 of Appellant’s petition for

rehearing (concerning the availability of McCrane

7

and new evidence revealed at his two trials) are

more properly matters to be brought to the atten-

tion of the trial court in a motion under F.R.Cr.P.

33.

3. We express no opinion on the merits of points

2, 9 and 10.

(Order denying petition for pa’el hearing). The Solicitor

General took the same position in the Brief for the United

States in Opposition to the Petition for Certiorari. Brief

in Opposition, No. 74-1511, p. 19 n. 13. Certiorari was

denied and, following the advice of the court of appeals,

petitioner returned to the district court wherein he filed

a Rule 33 motion for a new trial urging, inter alia, that

the McCrane affidavit destroyed the only possible basis

for the admission of the highly prejudicial evidence that

petitioner’s alleged co-conspirator had taken the Fifth

Amendment when questioned about the central facts of

the conspiracy. Nevertheless, the district court denied re-

lief, and petitioner once again appealed to the United

States Court of Appeals for the Third Circuit.

This time the United States Attorney, having successfully

convinced one panel of the court of appeals that the Mc-

Crane Fifth Amendment plea was admissible, despite its

plainly prejudicial effect, because it served to eerroborate

the testimony of the witness Preis that petitioner had

predicted the Fifth Amendment plea, then argued to a

second panel in the present appeal that the McCrane affi-

davit provided no basis for a new trial because it did not

directly contradict the testimony of the witness Preis:

Moreover, it does not, as appellant asserts (App.

Br., p. 40), contradict Preis’ testimony that appel-

lant had told him that, if called to testify before

a grand jury, McCrane would invoke the Fifth

8

Amendment. Appellant’s statement to Preis in this

regard could have been a prediction based both on

his knowledge as a lawyer and former Assistant

United States Attorney and his knowledge of Me-

Crane’s personality and activities. Indeed, appel-

lant could simply have been making this statement

without any knowledge or basis whatever solely to

induce Preis to lie. McCrane’s affidavit does not,

therefore, tend to prove that appellant did not make

the statement to Preis.*

3. In this connection, it should be noted that Preis

did not even testify that appellant told him that Mc-

Crane had told him he would invoke the Fifth

Amendment. His exact testimony was: “I happen

to know that Joe MecCrane is going to plead the

Fifth when he comes up for his hearing. .. .” (T.

2008-09).

(Brief for Appellee in No. 75-2375, 3d Cir., pp. 13-14).

Faced with this argument, the panel of the court of ap-

peals (which contained no members of the panel which

had heard and decided the original direct appeal) held:

At Gross’ trial, Preis testified that Gross com-

mented, “I happen to know that Joe McCrane is

going to plead the Fifth... .” MceCrane’s affidavit

does not contradict this critical statement. Rather,

it merely states that he did not tell Gross. In addi-

tion to the chance that Gross might have received

the knowledge indirectly, the defendant might have

been surmising or anticipating what would happen

or he might have been lying to Preis. Either is

possible even if the McCrane statement were ac-

cepted as correct.

ow

et OS ee

ee

9

(Opinion of the court of appeals (85a)). Petitioner

raised the question of the contradiction between the opin-

ions of the two panels of the court of appeals in a timely

petition for rehearing, which was denied. This petition

for a writ of certiorari followed.

ARGUMENT

1. By arguing its case in a piecemeal fashion, the

government has successfully been able to advance

two mutually contradictory positions to justify the

use against petitioner of the Fifth Amendment

plea of his alleged co-conspirator, despite the fact

that neither theory would have been constitution-

ally acceptable had both been argued at the same

time.

From the first day that the McCrane affidavit became

available to him, petitioner has sought to have it in-

cluded in the decision of the matters raised on his ori-

ginal direct appeal, since the existence of that affidavit,

if believed, undercuts the whole logic of the government’s

justification of the introduction against petitioner of the

Fifth Amendment plea of his co-conspirator. (The credi-

bility of the McCrane affidavit has never been properly

at issue, since the district court refused petitioner’s re-

quest that McCrane be called as a witness for examina-

tion and cross-examination.) The logic of the matter is

simple:

If, in fact, Joseph MecCrane’s Fith Amendment plea

came as a result of the independent advice of his coun-

sel, given after the alleged statement of Gross to Preis,

and if. as MecCrane swears, he never communicated with

petitioner concerning the decision to claim his rights un-

10

der the Fifth Amendment, then it is clear that the evi-

dence of the plea was improperly admitted, for the only

basis for the admission of this evidence which has ever

been sustained was that it was admissible for the limited

purpose of corroborating Preis’ testimony that petitioner

had told him that McCrane would claim his Fifth Amend-

ment privilege. To the panel of the court of appeals

which heard the original direct appeal in this case, the cor-

roborative value of the testimony, given the limiting in-

structions of the district court, outweighed the prejudicial

effect of the evidence of a co-conspirator’s Fifth Amend-

ment plea with respect to the very center of the alleged

conspiracy. But, when the McCrane affidavit established

that his Fifth Amendment plea did not corroborate Preis’

testimony, the basis for its admission failed, and only its

prejudicial effect remained. That is, the panel of the

court which heard this case on the original direct appeal

held that the McCrane Fifth Amendment plea could be

admitted solely because it corroborated the testimony of

the witness Preis; the panel hearing the present appeal

held that it made no difference that the McCrane affidavit

established that his Fifth Amendment plea corroborated

nothing.

There can be no doubt that the admission in evidence

that the fact that petitioner’s co-conspirator, when ques-

tioned before the grand jury concerning the central as-

pects of the government’s case against petitioner, claimed

his Fifth Amendment right not to testify was prejudicial

to petitioner in the highest degree. Not only was there

the danger that the jury may have treated the alleged

co-conspirator’s plea as the equivalent to the same plea

by petitioner, in violation of Grunewald v. United States,

353 U.S. 391 (1957), but the use of the notes of testi-

mony of the plea against petitioner plainly violated his

Sixth Amendment right of confrontation. When the gov-

ll

ernment itself concedes that it is immaterial for purposes

of the present appeal whether petitioner had any reason

to believe that McCrane would claim his Fifth Amend-

ment plea, the government has likewise admitted hat

there is not basis for admitting the fact of that plea as

corroborative of Preis’ testimony that petitioner had pre-

dicted it. The government may legitimately take either

of the positions it has advanced before the two separate

panels of the court of appeals; there is no conceivable

justification for the fact that it has taken contradictory

positions before two different panels simply because to

do so would permit it to defend a conviction.

Although neither the panel of the court of appeals

which heard petitioner’s original direct appeal nor this

Court on the original petition for certiorari could have

known that this might occur, the effect of forcing peti-

tioner to litigate the issue of the improper use of Joseph

McCrane’s Fifth Amendment plea on a piecemeal basis

was to permit the government to defend that plea on con-

tradictory bases. The plea was admissible, if at all, be-

cause it corroborated William Preis’ testimony that peti-

tioner had predicted that MeCrane would claim his privi-

lege. But, having successfully defended the conviction on

direct appeal on that theory, the government was then

faced with the clear sworn statement of McCrane that he

had not decided to claim his privilege, let alone discuss

the possibility of claiming with petitioner, at the time of

the supposed petitioner’s statement to Preis. The govern-

ment replied that McCrane’s testimony did not contra-

dict the testimony of Preis, since petitioner might have

predicted the Fifth Amendment plea on the basis of in-

tuition or even outright dishonesty. But if petitioner

merely guessed or lied about McCrane’s Fifth Amend-

ment plea, then the fact that the plea eventually did oc-

eur did not corroborate Preis’ testimony at all. The gov-

12

ernment cannot have it both ways. Unless this Court

faces the issues presented in the two appeals at one time,

the government will be permitted to sustain the conviction

in the present appeal on the basis of a theory which

demolishes the whole underpinning of the original opinion

of the court of appeals and of the brief of the govern-

ment successfully urging this Court to deny certiorari on

the original petition.

Where, as here, the most important constitutional rights

of a defendant are involved, the Court cannot permit the

government to seek to sustain a conviction by taking two

mutually contradictory positions.

2. If McCrane’s sworn statement that he never told

petitioner of any plans to plead the Fifth Amend-

ment does not conflict with Preis’ testimony that

petitioner knew McCrane would so plead, then

petitioner is entitled to a new trial because evi-

dence of McCrane’s Fifth Amendment plea was

erroneously admitted as corroborating Preis’ testi-

mony.

On the present appeal, the government took the posi-

tion that petitioner could have based his alleged predic-

tion that McCrane would invoke the Fifth Amendment

not on information communicated to him by his supposed

co-conspirator, but on his knowledge as a lawyer and for-

mer Assistant United States Attorney and his knowledge

of McCrane’s personality and activities. Indeed, the gov-

ernment has urged petitioner could simply have been

making his statement without any knowledge or basis

whatever solely to induce Preis to lie.

If, as McCrane swears, he never communicated with

petitioner concerning the decision to claim his rights un-

13

der the Fifth Amendment, if, in fact, Joseph McCrane’s

Fifth Amendment plea came as a result of the independ-

ent advice of his counsel, given after the alleged state-

ment of petitioner to Preis, and if, as the government now

claims, petitioner merely predicted on the basis of his

estimate of McCrane’s character—or on no basis at all—

that McCrane would assert his privilege, then clearly evi-

dence of the plea was improperly admitted. The only

grounds upon which admission of that evidence was sus-

tained was that the evidence made it more likely than

not that petitioner actually did predict it to Preis. Thus,

the government’s position that petitioner may well have

had no advance knowledge whatever of McCrane’s plea,

divests evidence of the plea of all probative value.

Since the basis for its admission fails, inquiry must

be made whether admission of the plea was prejudicial

or harmful constitutional error such that justice requires

a new trial. There can be no doubt that the admission

in evidence that the fact that petitioner’s co-conspirator,

when questioned before the grand jury concerning the

central aspects of the govermment’s case against peti-

tioner, claimed his Fifth Amendment right not to testify

was prejudicial to petitioner in the highest degree. First

of all, there is the danger that the jury may have treated

the alleged co-conspirator’s plea was the equivalent to

the same plea by petitioner, in violation of Grunewald

v. United States, 353 U.S. 391 (1957). It is respectfully

submitted that this Court’s decision in United States v.

Hale, 422 U.S. 171 (1975), although decided in a dif-

ferent context, sets the applicable standard for the use

of constitutionally protected silence as evidence. Recog-

nizing the vast danger of permitting jurors to hear that

a defendant [or, in the present case, his alleged co-con-

spirator] had exercised his constitutional right to remain

14

silent, this Court reversed a conviction obtained when the

defendant was impeached by his previous silence.

Not only is evidence of silence at the time of

arrest generally not very probative of a defendant’s

credibility, but it also has a significant potential

for prejudice. The danger is that the jury is likely

to assign much more weight to the defendant’s

previous silence than is warranted. And permitting

the defendant to explain the reasons for his silence

is unlikely to overcome the strong negative infer-

ence that the jury is likely to draw from the fact

that the defendant remained silent at the time of

his arrest.

United States v. Hale, supra, 422 U.S. at 180

Secondly, the jury might have improperly concluded

that petitioner had orehestrated that plea. Intelligent

jurors, having been informed by the court that the “cor-

roborating” refusal of MeCrane to testify before the

grand jury was admitted into evidence in regard to the

conspiracy to obstruct the graml jury and that petitioner

was responsible for the acts of his co-conspirators, could

hardly have concluded merely, as they were permitted

to do, that Preis testified truly when he said that peti-

tioner had said he was aware of McCrane’s intended plea,

without concluding as well that petitioner was in fact

responsible for that plea.

It is dubious that the judge’s cautionary instructions

could have cured the prejudicial effect necessarily gene-

rated by admission of evidence of the plea. According

to the general law charged by the judge, a claim of privi-

lege by a co-conspirator would be as much petitioner’s

plea as if he had made it himself. Certainly petitioner’s

own invocation of the Fifth Amendment could not be ad-

15

mitted against him even if accompanied by an instruction

functionally equivalent to those given in this case. Grume-

wald v. United States, 353 U.S. 391, 421-424 (1957). Under

the circumstances of this case, this Court’s holding in

Bruton v. United States, 391 U.S. 123 (1968), that limit-

ing instructions could not cure the introduction at the joint

trial of two defendants of one defendant’s confession

which incriminated the other, should apply equally when

one co-conspirator’s Fifth Amendment plea is offered

against the other.’

Moreover, even assuming that the instructions of the

trial court were sufficiently clear to inform the jury that

they were to disregard the fact that McCrane’s Fifth

Amendment plea was that of an alleged co-conspirator

of petitioner, the fact that the plea of privilege concerned

the very substance of the tax avoidance conspiracy even as

it allegedly furthered the concealment conspiracy makes it

difficult to believe that the jury could have disregarded

the—to a layman—obvious implication of the co-conspira-

tor’s pleading “the Fifth” about the Writers Associates-

Stop and Save transaction. Certainly the court of ap-

peals could cite no authority whatever for the proposi-

tion that the limiting instructions actually given would be

sufficient to cure such use of a co-conspirator’s Fifth

* Apparently even the United States Attorney, no mere layman,

was unable to follow the court’s limiting instruction concerning the

McCrane plea, and argued to the jury with respect to that plea that

it might

“.. . find as part of the conspiracy or . . . to corroborate

Mr. Preis’ testitnony, Joseph McCrane took the Fifth Amend-

ment in the United States grand jury.* And that is what

induced Mr. Preis to come down to lie.

(Tr. 4802 (Emphasis added) ).

16

Amendment plea. And it totally disregarded the well-

reasoned opinions of the Pennsylvania Supreme Court

in Commonwealth v. Terenda, 451 Pa. 116 (1973), and

Commonwealth v. DuVal, 453 Pa. 205 (1973), forbidding

the prosecution to put a co-defendant’s plea of privilege

before the jury and holding that instructions cannot cure

such an action, just as it disregarded the decision of the

court of appeals in SanFratello v. United States, 340

F.2d 560 (5th Cir. 1965), that the government cannot

constitutionally place before the jury defendant’s wife’s

claim of the Fifth Amerdinent privilege, Kinser v.

Cooper, 413 F.2d 730 (6th Cir. 1969}, that comment on

the failure of a co-defendant to testify at a joint trial im-

plicated the defendant and was, therefore, constitution-

ally impermissible, and Scoti vy. Perini, 439 F.2d 1066

(6th Cir. 1971), to the same effect. And in the San

Fratello case, at least, the trial court had charged fully

and firmly that the claim of privilege by the defendant’s

wife could be in no way used to incriminate any other

defendant in the case (340 F.2d at 564-65), yet the court

of appeals held that instruction no cure. When, as here,

there is no controlling opinion directly on point, the

court of appeals certainly had a duty to distinguish such

persuasive authority if it did not have to follow it.

The admission of MecCrane’s invocation of the Fifth

Amendment also gives rise to constitutional problems in

that it was introduced in a manner calculated to destroy

petitioner’s right under the Sixth Amendment to cross-

examine the witnesses against him. MceCrane was await-

ing trial on related charges at the time petitioner was

tried and was unavailable to petitioner as a witness. Yet

his unexplained and unexamined testimony before the

grand jury was used against petitioner as much as if that

testimony had been the subject of prior cross-examination

by counsel for petitioner. Moreover, it was introduced in

17

the way best calculated to prejudice petitioner. Petitioner’s

counsel, while preserving his objection to any use of the

grand jury testimony whatever, agreed to stipulate that

“McCrane was called pursuant to this investigation and

he declined to testify.” Instead, the grand jury stenog-

rapher was called and permitted to read questions relat-

ing to both Stop and Save, the company involved in the

present case, and numerous other companies with which

McCrane may have been involved but petitioner certainly

was not. The reading of the transcript of McCrane’s ex-

amination including McCrane’s repeated refusals to re-

spond conveyed the unmistakeable inference of petitioner’s

guilt, which inference petiiioner had no opportunity to

allay. The denial of the right to confrontation and effec-

tive cross-examination magnified the incriminatory effect

of this so-called corroborative evidence upon petitioner

and is harmful constitutional error. Pointer vy. Tezas,

380 U.S. 400, 405 (1965).

In summary, then, the panel of the court of appeals

which heard the direct appeal held that the corroborative

value of the testimony, given the limiting instructions of

the court below, outweighed both the prejudicial effect of

the evidence of a co-conspirator’s Fifth Amendment plea

with respect to the very center of the alleged conspiracy

and the effect of denying petitioner his Sixth Amendment

right of confrontation. But, when the McCrane affidavit

established that his Fifth Amendment plea did not cor-

roborate Preis’ testimony, and when the government it-

self conceded on appeal that it is immaterial whether

petitioner had any reason to believe that McCrane would

claim his Fifth Amendment plea, then the basis for its

admissions failed and only its prejudicial and unconstitu-

tional effects remained.

18

3. If McCrane’s affidavit—which was not available at

the time of petitioner’s trial—does conflict with

Preis’ critical testimony that petitioner was aware

that McCrane planned to invoke the Fifth Amend-

ment, then petitioner is entitled to a new trial on

grounds of after-acquired evidence.

On the second appeal, petitioner argued for a new trial

because of the conflict between McCrane’s sworn statement

that he never told petitioner he would invoke the Fifth

Amendment, and Preis’ testimony that petitioner knew of

McCrane’s future plea even before McCrane, according

to his affidavit, had discussed the matter with anyone.

MeCrane swore ox February 25, 1975 eight months after

petitioner’s sentencing, that he was prepared to testify

that:

At no time prior to my assertion before the

Grand Jury on April 27, 1973, of my right not to

testify on Fifth Amendment grounds, did I ever

tell Nelson Gross that I would assert such a plea.

Indeed, until April 21, 1973, well after Gross’ pur-

ported statement to Preis, I had not discussed with

my attorneys or anyone else what action I would

take if I were to be called before the Grand Jury. In

fact, I was out of the country on a vacation when

a Grend Jury subpoena was served upon my wife

on April 6, 1973, and I did not return to the coun-

try so that I could discuss this matter with anyone

until April 21, 1973.

(Affidavit of Joseph McCrane, p. 4 (emphasis added.) )

The existence of newly-discovered testimony such as

that contained in the McCrane affidavit has been held to

justify the grant of a new trial not merely when the evi-

19

dence is the recantation of a prosecuting witness, as in

United States v. Meyers, 484 F.2d 113 (3d Cir. 1973), or

the admission of a convicted co-defendant that he alone

is responsible for the offensive as in Newsom v. United

States, 311 F.2d 74 (5th Cir. 1962), and Ledet v. United

States, 297 F.2d 737 (5th Cir. 1962), in order to confirm

the testimony of the defendant, but in cases when an in-

dependent witness not known or available to the defend-

ant at the time of trial becomes available to corroborate

the defendant’s testimony thereafter, Amos v. United

States, 218 F.2d 44 (D.C. Cir. 1954).

Where, as here, the evidence of the witness McCrane

became available only after the trial and appeal from peti-

tioner’s conviction, assuming that that affidavit does not

render totally invalid the government’s theory that the

McCrane Fifth Amendment plea corroborated Preis’ testi-

mony, that newly available evidence justifies at the very

feast a new trial at which a jury can evaluate the credi-

bility of the witnesses McCrane and Preis.

A test for whether after-discovered evidence requires

the grant of a new trial was not set forth in the Third

Cireuit in United States v. Meyers, 484 F.2d 113, 116 (3d

Cir. 1973) :

1. The evidence must have been discovered after the

trial ;

2. The failure to learn of the evidence must not have

been caused by defendant’s lack of diligence;

3. The new evidence must not be merely cumulative

or impeaching;

4. It must be material to the principal issues in-

volved; and

5. It must be of such a nature that in a new trial it

would probably produce an acquittal.

20

Just as the Meyers court found a new trial necessary in

that case, the same test would require a new trial in this.

The first two prerequisites are obviously met by virtue

of the fact that the testimony was only recently made

available to petitioner.

The evidence being offered not only impeaches Preis’

testimony, but also directly contradicts the use to which

McCrane’s Fifth Amendment plea was put—one of the

principal issues involved in the case. The revelation that

McCrane’s Fifth Amendment plea was in no way the fruit

of a conspiracy with petitioner and that his decision to

claim his privilege before the grand jury turned entirely

upon he advice of his counsel does away with any cor-

roborative value that plea could conceivably have had.

And that plea was made absolutely central to the gov-

ernment’s case. As the United States Attorney stated,

“That proof, your Honor, goes to the very gut and the

heart of the conspiracy that is before this jury.” (Tr.

2760) Indeed, although the court charged only that the

plea was corroborative evidence, the United States Attor-

ney went further and told the jury it might find that Mc-

Crane’s plea was evidence of the conspiracy (Tr. 4802).

When his alleged co-conspirator’s plea of privilege is

given such stress by the prosecution, the availability of

a full explanation of the reasons for that Fifth Amend-

ment plea, an explanation which fully exculpates peti-

tioner, should certainly be permitted.

The defense likewise considered the plea of tremend-

ous significance. No piece of evidence at the trial of peti-

tioner—with the possible exception of the prosecutor

abused filing under the Corrupt Practice Act—provoked

so violent an objection by petitioner at trial, on appeal,

and in his first petition for certiorari, as the testimony

that Joseph McCrane has asserted his Fifth Amendment

21

privilege when questioned before the grand jury concern-

ing the transaction between Writers Associates and Stop

and Save Corporation which was the substance of tax

avoidance counts of petitioner’s indictment. Petitioner

chiefly objected that the evidence was inherently preju-

dicial and, especially in light of the prosecutor’s remarks,

was likely to be used by the jury as proof of the con-

cealment conspiracy.

By admitting evidence of the plea, the court implicitly

stated that its corroborative value outweighed the obvi-

ous danger of unduly prejudicing petitioner before the

jury. Now McCrane can testify that the jury should at-

tach no corroborative value to his plea because at the

time when petitioner supposedly stated so positively to

Preis that MeCrane would invoke the Fifth Amendment,

neither petitioner nor McCrane knew that he would do so.

Under these circumstances, if the government’s case

against petitioner does not fail because the McCrane plea

was improperly held to have corroborated the testimony

of the witness Preis, then it must fail because that vital

testimony concerning the government’s most vital witness

can now be shown to be untrue. Either way, the govern-

ment’s case simply cannot stand.

22

CONCLUSION

For the reasons hereinbefore set forth, this petition

for a writ of certiorari should be granted.

Respectfully submitted,

Bernarp G. SeEaat,

JAMES D. CrawForp,

ScHNnaDER, Harrison, Seca & Lewis,

1719 Packard Building,

Philadelphia, Pennsylvania 19102,

Attorneys for Petitioner.

Dated: June 10, 1976.

APPENDIX

Opinion of the United States Court of Appeals

for the Third Circuit

UNITED STATES COURT OF APPEALS

For tHe Tuirp Circuit

No. 74-1697

+

Unrtrep States OF AMERICA

Netson G. Gross,

Appellant.

Apreat From tue Unrrep States District Court ror THE

District or NEw JERSEY

—>

(D.C. Crim. No. 324-73)

Argued December 10, 1974

Before: AupiserT, ApAMs and Hunter, Circuit Judges.

[la]

2a

Opinion of the United States Court of Appeals

for the Third Circut

OPINION OF THE CouRT

(Filed—February 19, 1975)

James D. Crawford, Esquire

Philadelphia, Pennsylvania

Counsel for Appellant,

Jonathan L. Goldstein

United States Attorney

John J. Barry

Richard S. Zackin

William T. Pizzi

Assistant United States Attorneys

Newark, New Jersey

Counsel for Appellee

Aupisert, Circuit Judge.

Nelson G. Gross appeals from a final jndgment of sen-

tence following a jury verdict on a five-count indictment

charging aiding and assisting the filing of a false and

fraudulent tax return, obstruction of justice, subornation

of perjury before a grand jury and two counts of conspir-

acy. 26 U.S.C. 4 7206(2) and 18 U.S.C. §§ 1503, 1622, 371.

Although appellant has presented thirteen issues for re-

view, only certain merit discussion.

I.

Testimony was adduced at trial which, when taken in

the light most favorable to the verdict winner, indicates

3a

Opinion of the United States Court of Appeals

for the Third Circuit

the following: In July, 1969, Gross had a number of dis-

cussions with William Preis, president of Stop & Save

Trading Stamp Corporation, pertaining to a possible

$25,000 company contribution to William Cahill’s guber-

natorial campaign. When Preis stated that the company

could not pay that much in cash, Gross proposed an “easy

solution”. Gross stated that if Preis agreed to make a

$5,000 contribution by check, Gross would arrange to fur-

nish Stop & Save with a bill for services rendered. Gross

told Preis that “since it would be passed through as an

operating expense it would become tax deductible, and it

would actually only cost you half as much”. (T. 1911-12).

Gross assured Preis that, if the transaction were discov-

ered, the worst that would happen would be a disallow-

ance of the deduction by the Internal Revenue Service.

In September, 1969, pursuant to this arrangement, Preis

disguised a $5,000 contribution to Cahill’s campaign as a

business expense, utilizing a fictitious invoice from Writ-

ers Associates.

In the winter of 1972-73, the United States Attorney’s

office began investigating political activities in Bergen

County, New Jersey. A federal grand jury issued a sub-

poena to Stop & Save in March, 1973, requiring the cor-

poration to produce all records relating to Writers Asso-

ciates. Thereafter, Preis met with Gross and, displaying

the invoice and the grand jury’s subpoena, asked, “Where

do we go from here?” (T. 1993). Gross responded that

the invoice represented payment for services rendered re-

lating to a certain demonstration against an anti-trading

stamp bill which had been pending in the New Jersey Le-

gislature. Preis then asked Gross, “Why don’t I just plain

tell them the facts as they are, that it was a plain con-

4a

Opinion of the United States Court of Appeals

for the Third Circuit

tribution?” (T. 1999). Gross replied, “You can’t, be

cause if you do at this late stage of the game, you, will

immediately be cited for conspiracy and for fraud.”

(Ibid.). Preis, accompanied by corporate counsel Leonard

Wolfram, met with the United States Attorney and one of

his assistants on April 12, 1973. When shown the invoice

and asked what services had been rendered, Preis re-

sponded with the contrived story about the demonstraticn.

The government prosecutors informed Preis that they did

not believe him and invited him to “rethink the whole

story, ... get... good outside criminal counsel, . . . pre-

pare to come back... and... appear before the Grand

Jury ... [and] be very careful to tell the truth... .” (T.

2001). Later that day Preis met Gross and recited the

events that took place in the United States Attorney’s of-

fice. In response to Preis’ need for outside criminal coun-

sel Gross said, “You don’t have any need for outside

criminal counsel because I am it .... Perjury is one of

the hardest criminal cases there is to prosecute and to

prove, because .. . one of the ingredients and require-

ments of a-perjury charge is to have someone get up and

face you, challenge you, and claim that your statement

was an out and out lie, and there is just nobody who can

do that .... The only ones that really know the story

behind this is [sic] myself and Joe McCrane. And I hap-

pen to know that Joe McCrane is going to plead the Fifth

when he comes up for his hearing, and certainly I’m not

going to tell. ... [S]o you have nothing to worry about

for perjury.... They have no evidence of any kind.

You have nothing to worry about. You can go right back

and tell that same story, and you will get off absolutely

free.” (T. 2008-09).

5a

Opinion of the United States Court of Appeals

for the Third Circuit

On April 17, Preis appeared before the grand jury and

testified that a Stop and Save check in payment of the

Writers Associates’ invoice represented payment to a

group of women who demonstrated at the State Capitol in

Trenton, New Jersey. Preis was later indicted for mak-

false declarations before the grand jury, 18 U.S.C. § 1623.

On advice of new counsel, he pleaded guilty to the indict-

ment, and received permission to go back to the grand

jury and tell the truth about his and Gross’ participation

in the Cahill campaign. (T. 2021-31). The indictment

against Gross followed.

Il.

Count V of the inditement charged Gross with “sub-

orn(ing] . . . Preis to commit perjury, as that crime is

defined in Section 1623 of Title 18,” in violation of 18

U.S.C. § 1622.2 Appellant attacks his conviction on this

count on alternative grounds. He contends that Count V

False declarations before grand jury or court

(a) Whoever under oath in any proceeding before or an-

cillary to any court or grand jury of the United States know-

ingly makes any false material declaration or makes or uses

any other information, including any book, paper, document, rec-

ord, recording, or other material, knowing the same to contain any

false material declaration, shall be fined not more than $10,000

or imprisoned not more than five years, or both.

? Subornation of perjury

Whoever procures another to commit any perj i i

' jury is guil

of subornation of perjury, and shall be fined not more than $000

or imprisoned not more than five years, or both. |

6a

Opinion of the United States Court of Appeals

for the Third Circuit

of the indictment must be dismissed because Congress has

not made subornation to make a false declaration a crime.

Alternatively, appellant takes the position that, if such

subornation is a crime, the court erred in refusing to

charge the time-honored “two-witness rule.”

We begin our analysis with the recognition that there

are distinctions between the crime of general federal per-

jury, 18 U.S.C. § 1621,° and the vecently-created crime,

“False declarations before grand jury or court”, 18 U.S.C.

§ 1623.

One difference concerns “(t]he general rule in prose-

eutions for perjury [under § 1621] .. . that the uncor-

roborated oath of one witness is not enongh to establish

the falsity of the testimony of the accused set forth in the

indictment as perjury.” Hammer v. United States, 271

U.S. 620, 626 (1926). Weiler v. United States, 323 U.S.

606, 610 (1945), reiterated the Hammer holding and re-

emphasized: “The rule has long prevailed, and no enact-

8 Perjury generally

Whoever, having taken an oath before a competent tri-

bunal, officer, or person, in any case in which a law of the

United States authorizes an oath to be administered, that he

will testify, declare, depose, or certify truly, or that any written

testimony, deposition, or certificate by him subscribed, is true,

willfully and contrary to such oath states or subscribes any

material matter which he does not believe to be true, is guilty

of perjury, and shall, except as otherwise expressly provided by

law, be fined not more than $2,000 or imprisoned not more than

five years, or both. This section is applicable whether the state-

ment cr subscription is made within or without the United

States.

7a

Opinion of the United States Court of Appeals

for the Third Circuit

ment in derogation of it has come to our attention. The

absence of such legislation indicates thai it is sound and

has been found satisfactory in practice.” *

Legislation did come forward, however, in the Organ-

ized Crime Control Act of 1970, of which 18 U.S.C. § 1623

is a part, Title IV, Section 401(a), October 15, 1970, 84

Stat. 932. The Act makes it a crime for one to knowingly

make “any false material declaration” before any court or

grand jury of the United States. Section 1623(e) specif-

ically provides: “Proof beyond a reasonable doubt under

this section is sufficient for conviction. It shall not be

necessary that such proof be made by any particular num-

ber of witnesses or by documentary or other type of

evidence.” '

The legislative history discloses: “This Title [Title IV,

Fatse DeciaraTions] is intended to facilitate Federal per-

jury prosecutions and establishes a new false declaration

provision applicable in Federal grand jury and court pro-

ceedings. It abandons the so-called two-witness and direct

evidence rule in such prosecutions and authorizes a con-

viction based on irreconcilably inconsistent declarations

under oath... .” 1970 U.S. Code Cong. & Ad. News 41,07,

4008.

*It is clear from both Hammer and Weiler that the Supreme

Court does not consider the evidentiary rule to be of constitutional

dimension ; the Court merely refused to depart from “[t]he special

rule which . . . is deeply rooted in the past centuries” in the

“absence of . . . legislation.” Weiler v. United States, supra, 323

U.S. at 608-10.

8a

Opinion of the Unitec States Court of Appeals

for the Third Circuit

Abolition of the “two-witness rule” for prosecutions

under § 1623 is not the only distinction between the two

statutes. As we noted in United States v. Lardieri, 497

F.2d 317, 320 (3d Cir. 1974), rev’d in part on other

grounds on rehearing before original panel, — F.2d —

(3d Cir. No. 73-1750, December 18, 1974), Congress chose

to provide different mens rea elements: “Unlike the gen-

eral perjury statute, § 1623 requires that a false state-

ment be made ‘knowingly,’ rather than ‘willfully.”” Also,

in § 1623 Congress expressly limited the tribunals before

which the oath is taken.

Realizing that the general perjury and false declara-

tion statutes have certain differences, appellant would

have us hold that, without perjury as defined in § 1621,

there can be no subornation of “such jury” under § 1622.

Brief at 30. We reject this unduly narrow interpretation

of the subornation statute.

Section 1622 provides: “Whoever procures another to

commit any perjury is guilty of subornation of perjury.

. 2’ The express language of this statute embraces the

procuring of another to commit “any perjury,” not just

“such perjury as defined in § 1621.” While it is clear that

the perjury and false declaration statutes are not equiva-

lents, it is equally clear that § 1623 is a species of per-

jury.® Indeed, as previously rehearsed, the intent of § 1623

5 Congress neither amended § 1622 nor enacted a new suborna-

tion statute expressly proscribing subornation to make a false

declaration when it enacted § 1623 in 1970.

9a

Opinion of the United States Court of Appeals

for the Third Circuit

was to “facilitate Federal perjury prosecutions.” 1970

US. Code Cong. & Ad. News, supra, at 4008. Therefore,

we hold that the words “any perjury” in § 1622 include

the making of any false declaration under § 1623.°

Having disposed of appellant’s statutory crime argu-

ment, we turn to his “two-witness rule”’ contention. Ap-

pellant concedes, as he must, that Congress eliminated the

* The government believes that Hammer v. United States, supra,

lays appellant’s argument to rest. We disagree. Hammer held

that the general federal perjury statute applies to federal bank-

ruptcy proceedings. Bronston v. United States, 409 U.S. 352,

357 (1973). Unlike the case sub judice, the Hammer indictment

did not specify whether the subornation charge was drawn under

29(b) of the Bankruptcy Act [now 18 U.S.C. § 152] or § 125 of

the Criminal Code [now 18 U.S.C. § 1621]. However, the Court

found the allegations of the indictment were sufficient to charge

an offense under either the perjury statute or the Bankruptcy Act.

Accordingly, the omission in the indictment was *‘mmaterial; the

defendant was charged with “subornation of perju.,.” 271 U.S.

at 625. Thus, the Court in Hammer had no occasion to, and did

not, meet the precise issue before us.

7 Wigmore traces the ancestry of the two-witness requirement

to the “Romanesque law of Continental Europe.” 7 J. Wig-

more, Evipence § 2032, at 241 (3d ed. 1940). “By the end of

the 1600s it was decisively settled . . . that the ecclesiastical rules

about numbers of witnesses were not to be adopted into the com-

mon law. It was after that time that there arose the single com-

mon-law exception to the doctrine that one witness alone may

suffice in every case, namely, the rule that one witness, without

corroborating circumstances, does not suffice on the charge of

perjury. Yet even this rule was an indirect borrowing from the

civil law.” Ibid. § 2040, at 273.

10a

Opinion of the United States Court of Appeals

for the Third Circuit

two witness requirement for prosecutions under the false

declaration statute, § 1623. However, he somehow believes

that the crime of subornation of a false declaration, in

violation of 18 U.S.C. § 1622, requires corroboration.

Had appellant been indicted for subornation to com-

mit perjury under the general perjury statute, § 1621, his

argument would have had force. An essential element of

this crime is proof that perjury was committed; and

“(t]he general rule in prosecutions for perjury is that

the uncorroborated oath of one witness is not enough to

establish the falsity of the testimony of the accused set

forth in the indictment as perjury.” Hammer v. United

States, swpra, 271 U.S. at 626 (emphasis added). “To hold

to the [two-witness] rule in perjury and to deny its appli-

eation in subornation cases would lead to unreasonable re-

sults.” Jbid. at 628. Thus, Hammer held that the same

rule of evidence must apply to both crimes—perjury and

subornation of perjury.

But that is not this case. Here appellant was indicted

for suborning Preis to make a false declaration before a

grand jury. Section 1623 expressly abrogates the tradi-

tional “two-witness” rule.® To deny this rule’s applica-

tion in § 1623 prosecutions and to require its application

in false declaration, subornation prosecutions would un-

8 Congressional action in 1970 may be contrasted with the action

of the 1911 joint Parliamentary Committee in England. Looking

to a codification of English criminal law, the English Committee

recommended, and Parliament passed, the Perjury Act of 1911,

prohibiting convictions “solely upon the evidence of one witness as

to the falsity. . . .” Weiler v. United States, supra, 323 at 610

n.4.

lla

Opinion of the United States Court of Appeals

for the Third Circuit

deniably lead to unreasonable results. Using the words

of the Court in Hammer: “Obviously the same rule of

evidence in respect to establishing the falsity of the mat-

ter alleged as [a false declaration] must apply to both.”

271 U.S. at 628.

Il.

The grand jury did not name Anthony Statile as a

co-conspirator in Count I, no did it name either Statile

or Joseph McCrane as a co-conspirator in Count III. It

did name MecCrane as an unindicted co-conspirator in

Count I. Both counts did recite that appellant and the

named co-conspirators had conspired with each other “and

with others.”

On February 5, 1974, the government informed appel-

lant by letter that it might offer proof that Statile was a

Counts I and III co-conspirator. A letter dated February

21 notified appellant that McCrane similarly might be

linked as a co-conspirator under Count III.

Selection of the jury commenced on February 26. Two

and one-half days later, immediately after completion of

the selection, appellant moved to require the government

to disclose if in fact it was going to name Statile and

McCrane as co-conspirators. After receiving an affirma-

tive oral response from the government, appellant argued

that (1) the addition of the names constituted a fatally

improper amendment to the indictment and that (2) he

was not accorded sufficient time to prepare his defense

The district court rejected these arguments. Appellant

reasserts them before us.

12a

Opinion of the United States Court of Appeals

for the Third Circuit

We do not write on a clear slate on the issue of amend-

ment or variance of an indictment. United States v.

Radowitz, — F.2d — (3d Cir., No. 74-1235, December 18,

1974); United States v. Goldstein, 502 F.2d 526 (3d Cir.

1974) (in bane); United States v. Somers, 496 F.2d 723

(3d Cir.), cert. denied, 43 U.S.L.W. 3208 (U.S. Oct. 9,

1974); United States v. De Cavalcante, 440 F.2d 1264 (3d

Cir. 1971). We have previously reviewed the various func-

tions of an indictment, United States v. Goldstein, supra,

and have held that the precise inquiry is whether the

change in the indictment is substantial or material, and

not merely one of form. Ibid. at 528. We conclude that

the addition of Statile and McCrane “did not so change

the basic theory of the alleged conspiratorial agreement

as to constitute an amendment to the indictment.” United

States v. De Cavalcante, supra, 440 F.2d at 1272 (footnote

omitted).

Appellant’s claim of insufficient time to prepare his

defense must be tested in terms of actual or potential

prejudice.

We now dispose of the contention relating to the ad-

dition of McCrane’s name. He was inexorably inter-

twined with the specific allegations of the Count I con-

spiracy and with the government’s theory of the suborna-

tion charge.

Specifically, appellant asserts that the addition of Me-

Crane as a Count III co-conspirator ena’ led the gov-

ernment to get into evidence the fact that McCrane had

exercised his Fifth Amendment right before the grand

jury. The court, in the proper exercise of its discretion,

admitted the evidence, with the appropriate cautionary in-

l3a

Opinion of the United States Court of Appeals

for the Third Circuit

structions, for the specific and limited purpose of cor-

roborating Preis’ unobjected to testimony that Gross had

said: “And I happen to know that Joe McCrane is going

to plead the Fifth when he comes up for his hearing. . . .”

(T. 2009, 2632, 2779-81, 2863-64). Because the court did

not admit this evidence under the co-conspirator’s excep-

tion to the hearsay rule, we fail to see how this preju-

diced appellant.®

Without alleging any specific prejudice from the addi-

tion of Statile, appellant contends that he was somehow

hamstrung in preparing his case for trial. Statile suc-

ceeded Gross as Republican Chairman of Bergen County.

Jack Slavitt, a Newark lawyer, was solicited in 1970, along

with others, to pay outstanding bills of appellant’s cam-

paign. He agreed to make a contribution in the amount

of $1,000. Subsequently, he received a Mailmar invoice in

the amount of $1,015. Mailmar was a printing company.

Accompanying the invoice was a letter from Statile re-

questing Slavitt to send his check, which was made pay-

able to Mailmar, directly to him at “GOP headquarters.”

(T. 1027). It is in the Slavitt situation that Statile’s par-

ticipation really surfaces. The government offered this

*'We also do not believe that the court abused its discretion

when it permitted the government to read into evidence the ex-

cerpt of the grand jury transcript showing that McCrane pleaded

the Fifth Amendment when asked about his possible role in the

issuance of “false and fictitious invoices”. Because of the brevity

of the excerpt introduced, because the question complained of

merely provided the context in which McCrane pleaded the Fifth

and because the question made no reference to Gross himself, we

do not ree that the reading of the excerpt was “inflammatory”

or “preit x

l4a

Opinion of the United States Court of Appeals

for the Third Circuit

testimony to connect co-conspirators, Statile and Gross,

with the use of Mailmar to mask political contributions.

We have some difficulty in perceiving the exact thrust

of appellant’s argument. We do not believe that he has

demonstrated, by brief or at oral argument, how the addi-

tion of Statile as a co-conspirator altered the reception of

this or other evidence referring to Statile’s participation.

Appellant received informal! notice of the possible addi-

tion of Statile three weeks before trial. No motion was

made by appellant before the jury was selected to deter-

mine whether the government definitely intended to add

Statile. After it was determined that Statile was to be

added, appellant made no motion for a continuance. See

United States v. Somers, supra, 496 F.2d at 746. Slavitt’s

testimony describing Statile’s participation was completed

on March 4; appellant did not open his defense until ten

days later. Cf. ibid.

We conclude, therefore, that appellant did have time

to react to Statile’s addition and that the preparation of

his defense was not adversely affected thereby.

IV.

Appellant argues that the trial court abused its dis-

cretion in permitting him to be cross-examined as to his

income and as to certain financial statements he had filed.

We find no abuse. The government’s case was built largely

on the testimony of Preis, President of Stop & Save, cor-

porate counsel Leonard Wolfram and the wealthy in-

15a

Opinion of the United States Court of Appeals

for the Third Circut

dustrialist Bernard Striar.%° It was one of the pillars of

the Gross defense, from the opening statement to the sum-

mation, that Gross was an insignificant person, and that

these powerful men could not have been influenced by him.

Thus, in the opening statement of the defense, the jury

was told:

The Gross firm was only little counsel. Nelson

Gross was not a mastermind here. He was a private

in William Preis’ army.

e @ e

He [Gross] was only one in the Preis army of try-

ing to convince legislators that it really 1ru’t a good

thing for the State of New Jersey to pass legisla-

tion which will seriously affect trading stamps.

(T. 748, 752-53).

In the government’s case, Preis and Wolfram were

cross-examined by Gross’ counsel about their salaries, de-

ferred income, life insurance benefits, executive incentive

bonuses and stock option plans. By cross-examination, ap-

pellant developed that Grand Union, the parent company

of Stop & Save, had a net worth of millions and annual

sales of more than a billion dollars. Striar was also cross-

examined about his finances and his company’s profits.

10 Striar testified that during a July, 1970, meeting with Slavitt

and appellant, he decided to make a $2,000 contribution to ap-

pellant’s 1970 senatorial campaign. He and appellant discussed

the possibility of masking it as a business expense. Gross then

said, “[T]his could be taken care of by Mailmar.” (T. 793).

Shortly after this meeting Striar’s New York office received a

Mailmar invoice in the amount of $2,000, which was duly paid

but not charged to Striar’s personal account.

16a

Opinion of the United States Court of Appeals

for the Third Circuit —

told:

I say to you that William Preis, the Number 3 man

in this million dollar corporate complex of Grand

Union, the man who by his own testimony built this

Triple S blue stamp operation up from nothing in

25 years to where it is today, is the man who by

his own testimony was the general in the operation

to combat and stamp out legislation wherever it

might crop up that would vitally affect his busi-

ness.

& e e

It defies common sense, and it’s an insult to your

intelligence for him to say to you that in this one

sphere he deferred to Nelson Gross who concocted

the idea in 1969 of a phony campaign contribution

and in 1973 directed him and counseled him to lie

to Mr. Goldstein and the Grand Jury.

(T. 4532-33).

It is the government’s position, and we agree with it,

that once the juxtaposition of financial net worths was

introduced in the case, it was proper for the government

to elicit testimony from Gross seeking to demonstrate

that he was not so financially insignificant as he purported

to be. (See T. 4126-28).

Upholding comparable trial strategies, this court, in

United States v. Lowe, 234 F.2d 919, 922 (3d Cir.), cert.

dented, 352 U.S. 838 (1956) (footnote omitted), speaking

through Judge Goodrich, added an appropriate literary

During the summation of the defense, the jury was

17a

Opinion of the United States Court of Appeals

for the Third Circuit

touch: “When a party opens up a subject, even though it

may not be strictly relevant to the case, he cannot com-

plain on appeal if the other side gives him a Rowland for

his Oliver.” ™

Tangential to this issue is appeliant’s contention that

it was plain error for the court to permit the government

to cross-examine him concerning his sworn statement of

receipts and expenditures filed as a 1970 candidate for the

United States Senate. This statement was required by the

Federal Corrupt Practices Act, 2 U.S.C. § 241 et seq.”

Gross argues that an issue of possible violation of this act

was placed before the jury on cross-examination, albeit

without a timely objection being raised. The government

justifies its use as a means to impeach appellant’s credi-

bility.

Gross testified on direct that he had never heard of the

Mailmar Printing Company through the time of the No-

vember, 1970 election. In the Corrupt Practices Act state-

ment, Mailmar was listed as one of the firms for which he,

in October, 1970, expended funds for his campaign. This

1! The government later represented that it was using appel-

lant’s 1968-72 income tax returns to tie appellant’s income, largely

derived from his firm’s representation of sewerage authorities,

with his political position. (T. 4139). Appellant’s counsel ob-

jected to such use but frankly admitted that Gross had already

so testified. (Jbid.). Indeed, the court cautioned the jury that

“{t]here is no impropriety involved.” (T. 4148). In light of

these facts, we find no abuse here.

12 Repealed and superseded by Federal Election Campaigns Act,

2 U.S.C. § 431 et seg. Act of Feb. 7, 1972, Pub. L. 92-225.

18a

Opinion of the United States Court of Appeals

for the Third Circuit

was fair game for the jury on the issue of credibility.“

Indeed, had there been a timely objection to this particu-

lar use of the statement, we believe that the court would

have properly exercised its discretion if it had admitted

it. As to this issue the probative value of the testimony

outweighed any accompanying prejudice.

We are less certain of the purpose and propriety of

using the statement as a foundation for the questions con-

cerning the amount of monies received during the cam-

paign from various sources, the number of additional cam-

paign accounts that Gross had, and Gross’ knowledge of

expenditures by the various campaign accounts in his be-

half. These questions surrounded the Mailmar inquiry.

Because we are of the view that the use of the statement

as to Mailmar would have been a proper exercise of dis-

cretion, we do not believe that these few additional ques-

tions, in the absence of a timely objection, were so preju-

dicial as to require a new trial.

Appellant argues that the Assistant United States At-

torney went far beyond the bounds of permissible closing

argument and disclosed the real purpose of admitting the

sworn statement—that appellant violated the Federal Cor-

rupt Practices Act. The prosecutor said:

Why do we bring out the conflict—the senatorial

campaign statement? Because it is eloquent testi-

18 The government also argues that it utilized the statement to

refute the Gross-created impression that he was naive when it

came to campaign financing. We have reviewed the record in

this light and do not believe that the statement was used for this

purpose.

19a

Opinion of the United States Court of Appeals

for the Third Circuit

mony to the way this defendant views the laws of

the United States.

(T. 4826). Immediately following this question and rep-

resentation, the prosecutor went on to say:

It is eloquent testimony to what he considers on

oath to be, and the oath I’m going to read you con-

cerns just the expenditures because that really is

the important part of this document.

The important part of this document that was

sworn to, signed and subscribed to, read, as he him-

self told you, and read carefully, was, Number 1,

Mailmar. He denied ever knowing Mailmar.

(T. 4826-27).

Referring to an unreported campaign contribution by

appellant’s law partnership, the Assistant United States

Attorney added:

That was a direct contribution that had to be re-

port-d under the laws of the United States, even

then.

(T. 4827). Shortly afterward, in referring to appellant’s

statement on cross-examination that he had “avoided” the

Corrupt Practices Act, the Assistant United States At-

torney concluded:

Nelson Gross, to sum it up in his own words, avoids

the law, he violates the law, he is guilty of the

crime charged beyond any reasonable doubt in this

case.

(T. 4828-29).

20a

Opinion of the United States Court of Appeals

for the Third Circuit

These remarks seem to us to go beyond merely attack-

ing appellant’s credibility through comment on how he

viewed an oath, and appear to constitute an argument

that appellant’s alleged violation of the Corrupt Practices

Act was a matter which the jury could consider in deter-

mining the guilt or innocence on the crimes charged. The

last statement quoted above is particularly troublesome,

because it seems to twist Gross’ statement that he

“avoided” the Act into an admission that he had violated

it,“* and to make further implication that he is therefore

guilty of the crime charged.

Defense counsel failed to object at the time these state-

ments were made; consequently, we can reverse only if the

statements constituted plain error. United States v.

Somers, supra, 496 F.2d at 742. We have concluded that

they did not constitute plain error. Nevertheless, we un-

hesitatingly reaffirm Judge Garth’s recent admonitions in

United States v. Somers, supra.

V.

The remaining contentions raised by appellant may be

discussed more briefly. We find no error in the trial

judge’s charge that Grand Union Company had made no

14 When Gross was asked whether the Act was “violated”, he

specifically denied that it had been and stated instead that it was

“avoided”. (T. 4093). Gross testified and his counsel argued

that it was not a violation of the Act to fail to report contribu-

tions filed by local committees operating solely within one state

(T. 4091, 4105-06), and the trial judge so charged the jury. (T.

4894).

2la

Opinion of the United States Court of Appeals

for the Third Circuit

attempt to deceive the IRS concerning other campaign

contributions. It is apparent from the context of that por-

tion of the charge that the trial judge was referring to at-

tempts to deceive the Internal Revenue Service by the

use of a false invoice, and there was, in fact, no evidence

that false invoices were employed to disguise those other

contributions. Furthermore, we agree with the govern-

ment that Preis’ possible role in deducting the other con-

tributions was not really relevant, since it was clear that

Preis used someone from outside Grand Union to obtain

a Writers Associates invoice to make possible the deduc-

tion of the $5,000 contribution at issue. The only real

dispute at trial was whether that outside person was

Gross or someone else.

Little more need be added. We reject appellant’s con-

tention that his conviction must be set aside because of

the prosecution’s alleged knowing reliance on perjured

testimony. Appellant’s characterization of Wolfram’s tes-

timony as “perjured” is nothing more than a characteriza-

tion, and there is no evidence to show that the govern-

ment knew that Wolfram’s testimony was inaccurate or

“substantially misleading”. Cf. United States v. Harris,

498 F.2d 1164, 1169 (3d Cir. 1974). As to further allega-

tions of prosecutorial misconduct, we accept the exhaus-

tive analysis of Judge Whipple in his opinion denying a

new trial. 375 F. Supp. 971 (D. N.J. 1974). We have

reviewed the testimony and are satisfied that there was

sufficient evidence to support the convictions.» We have

15 Appellant’s numerous contentions challenging the sufficiency

of the evidence relate merely to the credibility of Preis and Wolf-

ram, which we cannot evaluate for ourselves on appeal. Where

the jury has returned a verdict of guilty, an appellate court is

bound to accept the evidence in the light most favorable to the

prosecution. See United States v. De Cavalcante, supra.

22a

Opinion of the United States Court of Appeals

for the Third Circuit

considered the other contentions raised by appellant and

find them devoid of merit."*

The judgment of the district court will be affirmed.

A True Copy:

Teste:

Clerk of the United States Court

of Appeals for the Third Circuit.

%*Other contentions are: the admission of co-conspiratorial

hearsay was in error and the charge to the jury compounded the

error; the court’s lack of an evenhanded policy during discovery

violated substantial and constitutional rights of the defendant:

the defendant was deprived of his constitutional right to a fair and

impartial jury; the indictment should have been dismissed on the

ground of selecitve prosecution and discovery should have been

permitted with respect thereto; direct political contributions are

deductible for tax purposes as ordinary and necessary business

expenses, and therefore the indictment should have been dismissed

or at least discovery permitted with respect thereto.

23a

Judgment of the United States Court of Appeals

for the Third Circuit

Unitep States Court or APPEALS

For tHE Tuirap Crrcuit

No. 74-1697

>

Unrrep States or AMERICA

vs.

Netson G. Gross,

Appellant.

(D.C. Criminal No. 324-73)

—_—<@—

On AppreaL From tHe Unitep States District Court

For tHe —— Distriet or NEw JERSEY

Present: Aupisert, ApaMs and Hunter, Circuit Judges

JUDGMENT

This cause came on to be heard on the record from the

United States District Court for the District of

New Jersey and was argued by counsel.

On consideration whereof, it is now here ordered and

adjudged by this Court that the judgment of the said

District Court, entered June 18, 1974, be, and the same

is hereby affirmed.

ATTEST :

THomas Quinn

Clerk

February 19, 1975

24a

Order Denying Petition for Panel Rehearing

Unrrep Srates Court or APprgats

For THE Turmp Circurr

No. 74-1697

—p—

Unrrep Statres oF AMERICA

Vv.

Netson G. Gross,

Appellant.

—-

Present: Aupisert, Apams and Hunter, Circuit Judges.

Sur Petition ror Pane, REHEARING

The petition for panel rehearing filed by Appellant in

the above entitled case having been submitted to the

judges who participated in the decision of this court and

no judge who concurred in the decision having asked for

rehearing, the petition for panel rehearing is denied.

1. Points 1 and 3-8 of Appellant’s petition for rehear-

ing were carefully considered by the Court and found to

be without merit.

2. Points 2, 9 and 10 of Appellant’s petition for rehear-

ing (concerning the availability of McCrane and new evi-

dence revealed at his two trials) are more properly mat-

ters to be brought to the attention of the trial court in a

motion under F. R. Cr. P. 33.

3. We express no opinion on the merits of points 2, 9

and 10.

By THe Covrr,

ApDAMs

Circuit Judge

Dated: April 2, 1975

25a

Order Denying Petition for Rehearing

Unrrep States Court or APPEALS

For tHe Taurmp Crrcurr

No. 74-1697

~~

Unrrep States oF AMERICA

Vv.

Netson G. Gross,

Appellant.

—>—

Sur Petition ror REHEARING

Present: Serrz, Chief Judge, and Van Dusen, ALDISERT,

Apvams, Rosenn, Hunter and Wels, Circuit

Judges.

The petition for rehearing filed by Appellant in the

above entitled case having been submitted to the judges

who participated in the decision of this court and to all

the other available circuit judges of the circuit in regular

active service, and no judge who concurred in the decision

having asked for rehearing, and a majority of the circuit

judges of the circuit in regular active service not having

veted for rehearing by the court in bane, the petition for

rehearing is denied.

By the Court,

ALDISERT

Judge

Dated: April 2, 1975

* Judges Gibbons & Garth did not participate in the deci-

sion of this matter.

26a

Opinion of the United States District Court

for the District of New Jersey

—>

Unrrep States or AMERICA

v.

Netson G. Gross,

Defendant.

—+

Crim. A. No. 324-73.

Unrrep States District Court,

D. New JERSEY.

May 15, 1974.

Jonathan L. Goldstein, U. S. Atty., and Richard D. Sha-

piro, Asst. U. S. Atty., for the United States.

Hannoch, Weisman, Stern & Besser, by Albert G. Besser,

and Ronald M. Sturtz, Newark, N. J., for defendant.

OPINION AND ORDER

Wuiprpte, District Judge:

The defendant Nelson Gross moves this Court for a

judgment of acquittal pursuant to Fed.R.Crim.P. 29(c)

alleging that the evidence presented in the case was in-

sufficient to sustain his conviction for the offenses charged

in the indictment or in the alternative, the defendant

moves this Court for a new trial in the interests of jus-

tice pursuant to Fed.R.Crim.P. 33.

27a

Opinion of the United States District Court

for the District of New Jersey

[1] In ruling on a motion for a judgment of acquittal

the test that ought to be applied by the trial judge is that

laid down by Judge Prettyman in Curley v. United States,

81 U.S.App.D.C. 389, 160 F.2d 229 (1947):

... @ trial judge, in passing upon a motion for a

directed verdict of acquittal, must determine wheth-

er upon the evidence, giving full play to the right

of the jury to determine credibility, weigh the evi-

dence, and draw justifiable inferences of fact, a rea-

sonable mind might fairly conclude guilt beyond a

reasonable doubt. If he concludes upon the evi-

dence there must be such a doubt in a reasonable

mind, he must grant the motion; or, to state it an-

other way, if there is no evidence upon which a rea-

sonable mind might fairly ecnclude guilt beyond a

reasonable doubt, the motion must be granted. If

he concludes that either of the two results, a rea-

sonable doubt or no reasonable doubt, is fairly pos-

sible, he must let the jury decide the matter. /d.

232-233.

In the instant matter, the jury has decided upon the de-

fendant’s guilt to what it believed to be beyond a reason-

able doubt. ‘the renewal of the defendant’s motion for

acquittal now is premised on his belief that the jury could

not have reached this conclusion rationally on the state

of the evidence presented in the case and for this reason

the jury’s verdict must be overturned, as against the

weight of the evidence and as a product of passion and

prejudice demanding that a judgment of acquittal be now

entered for the tefendant.

28a

Opinion of the United States District Court

for the District of New Jersey

[2-4] In deciding whether the reasonable juror would

have had to have a reasonable doubt concerning the de-

fendant’s guilt, the trial court must view the evidence in

a light most favorable to the government and give it the

benefit of all legitimate inferences. United States v. Hop-

kins, 354 F.Supp. 634 (E.D.Pa. 1973); Powell v. United

States, 135 U.S.App.D.C. 254, 418 F.2d 470 (1969). In

the instant case, the defendant bases his motion for a

judgment of acquittal on the incredibility of the govern-

ment’s chief witnesses, Leonard Wolfram and William

H. Preis, which the defendant believes was established by

the thorough cross-examination of Wolfram and by the

direct examination of Wolfram’s secretary, Ruth Smith,

and the Stop and Save Comptroller, Urinyi. In my re-

view of this testimony, I do not consider it inconceivable

nor highly improbable that the jury could have rationally

believed the testimony of Preis and Wolfram. Further

it is not within the Court’s power when ruling on a judg-

ment of acquittal to assess the credibility of the govern-

ment’s witnesses. Its function on this motion is to pon-

der probabilities, not to reach actual conclusions; the final

decision concerning the believability of the government’s

witnesses rests with the jury. United States vy. Allard, 240

F.2d 840 (3rd Cir. 1957); United States v. Morris, 308

F.Supp. 1348 (E.D.Pa. 1970). What the Court does in

ruling on the judgment of acquittal is to decide whether

a rational juror could find on the state of the evidence

that the defendant was guilty beyond a reasonable doubt.

This the jury has done and I cannot find its conclusion

irrational.

[5] The credibility of witnesses comes within the pur-

view of the trial court however, when it rules on the mo-

29a

Opinion of the United States District Court

for the District of New Jersey

tion for a new trial after the jury has rendered its ver-

dict. At that time, it is incumbent on the Court to evalu-

ate and weigh the evidence in order to decide whether

the jury’s verdict is against the weight of the evidence

and whether a miscarriage of justice has occurred. This

motion is directed to the conscience of the Court and it

must set the jury’s verdict aside, when in its review of

the facts, the conviction is contrary to the weight of the

evidence. United States v. Wilson, 178 F.Supp. 881 (D.D.

C.1959).

[6] The jury’s verdict, however, is entitled to presump-

tive validity and the trial court should exercise its author-

ity in this area very sparingly and only in the most excep-

tional cases when it is convinced that a gross injustice

will have been done if it fails to act. United States v.

Provenzano, 240 F.Supp. 393 (D.N.J.1965) affirmed 353

F.2d 1011 (3rd Cir. 1965); United States v. Leach, 427

F.2d 1107 (1st Cir. 1970):

Motions for new trial are directed to the trial

court’s discretion. Under its broad power, the court

may weigh the evidence and consider the credi-

bility of witnesses. The remedy is sparingly used,

the courts usually couching their decisions in terms

of “exceptional cases,” United States v. Pepe, 209

F.Supp. 592, 595 (D.Del.1962), affirmed 339 F.2d

264 (3rd Cir. 1964), “Miscarriage of justice”,

United States v. Parelius, 83 F.Supp. 617, 618

(D.Haw.1949), and where “the evidence preponder-

ates heavily against the verdict”, United States v.

Robinson, 71 F.Supp. 9, 10-11 (D.D.C.1947). ...

Td. 1111

30a

Opinion of the United States District Court

for the District of New Jersey

In reviewing the instant matter, the defendant directs

the Court to ten alternative bases for the grant of a new

trial. The defendant alleges: (1) that the United States

attorney knowingy utilized the perjured testimony of

Leonard Wolfram in his case in chief (2) that the Court’s

admission of Joseph McCrane’s Fifth Amendment testi-

mony before a Federal Grand Jury was so prejudicial

that it rises to reversible error (3) that the Court erred

in allowing the United States Attorney to elicit testi-

mony concerning the defendant’s economic status (4) that

the Court erred in allowing testimony concerning defend-

ant’s compliance or failure thereof with the 1925 Federal

Corrupt Practices Act, 2 U.S.C. § 241 et seq. (5) that

the United States Attorney engaged in conduct through-

out the course of the trial which necessitates prophylatic

relief by way of granting the defendant a new trial (6)

that the plan for petit jury selection in this District is

unconstitutional in that it systematically excludes attor-

neys, public officials and other persons of economic means

(7) that the Court erred in charging the jury to ignore

the tax deductibility of certain items listed on Grand

Union’s Federal Tax Returns (8) that the verdict is

clearly against the weight of the evidence (9) that the

Court erred in admitting the hearsay testimony of Bern-

ard Striar and Suzanne Phillips Miller concerning their

respective conversations with co-conspirators Anthony

Statile and Joseph McCrane and (10) that the Court

erred in allowing the naming of Anthony Statile in Count

I and Joseph McCrane in Count ITI of the indictment on

the eve of trial. These ten bases for a new trial raised

by the defendant may be grouped into four categories.

The first of these concerns alleged errors committed by

the Court in its rulings on evidence in the course of the

3la

Opinion of the United States District Court

for the District of New Jersey

trial (Nos. 2, 3, 4 and 9) in its charge to the jury at the

close of the case (No. 7) and in its ruling on a pre-trial

motion (No. 10). Category two consists of assisting the

credibilty of Leonard Wolfram and whether his testi-

mony, apparently believed by the jury, is so infirm as to

characterize the jury’s verdict as substantially contrary

to the weight of the evidence (Nos. 1 and 8). Category

three charges prosecutorial misconduct by the United

States Attorney and his bad faith reliance on perjured

testimony (Nos. 1 and 5). Finally, Category four alleges

the unconstitutionality of this District’s jury selection

plan (No. 6).

[7] The issues raised in Category one of the defend-

ant’s motion essentially ask this Court to reconsider its

rulings rendered during the course of the trial. The bur-

den rests on the defendant to demonstrate that these pre-

vious rulings vitiated the essential fairness of his trial

and resulted in a denial of due process. United States ex

rel. Darcy v. Handy, 351 U.S. 454, 76 S.Ct. 965, 100

L.Ed. 1331 (1956). The defendant previously objected to

these rulings when the issues were originally raised and

this Court rejected the defendant’s arguments then. At

this juncture of the case, wherein the burden which the

defendant must sustain is much heavier, he has advanced

no new arguments and this Court must therefore reaffirm

its previous rulings and deny defendant’s motion for a

new trial based on these grounds.

In Category two, the defendant properly requests this

Court to assess the credibility of the government’s wit-

nesses and to determine whether the jury’s verdict is

contrary to the weight of the evidence. United States v.

Zannino, 468 F.2d 1299 (1st Cir. 1972); United States v.

32a

Opinion of the United States District Court

for the District of New Jersey

Joines, 327 F.Supp. 253 (D.Del.1971). The major thrust

of defendant’s motion is directed to the credibility of

Leonard Wolfram. His demeanor on the witness stand

and his responses to the expert cross examination by

the defendant’s counsel proved him to be a confused and

befuddled witness. His memory was confined to the gen-

eral sequence of events in February and April of 1973

and frequently failed to recall specific dates, specific

documents, and the specific words of conversations. The

defendant alleges that the witness had a memory of con-

venience which remembered only these events which would

implicate the defendant in a plot to suborn the perjury

of William H. Preis and failed to recollect any event

which might indicate his own personal participation in

this attempted subornation plot. This Court, however,

does not go so far. Assuredly Leonard Wolfram was not

a strong witness for the government, his lapses of mem-

ory and recall of detail, were a frustrating and faltering

aspect of the government’s case. His testimony was se-

verely neutralized by the defendant’s cross examination.

Leonard Wolfram. however, was not the only govern-

ment witness nor was he necessarily believed fully and

confidently by the jury in order for it to justify its guilty

verdict. The testimony of Bernard Striar and William

Preis along with other government witnesses was suffi-

cient to justify the jury’s verdict and, for this reason,

the defendant’s motion for a new trial based on Cate-

gory two must also be denied.

Appended to the defendant’s attack on the testimony

of Leonard Wolfram, there is a technical argument con-

cerning the legal sufficiency of Count V of that indict-

ment. Count V alleges that the defendant suborned the

33a

Opinion of the United States District Court

for the District of New Jersey

perjury of William Preis before a United States Grand

Jury as that perjury is described in 18 U.S.C. § 1623, Le.

that Preis knowingly made a false declaration before the

Grand Jury.

[8] The offense which Preis committed is relatively

new. It was enacted by Congress in 1970 in order to

abrogate the so-called two witnesses rule in perjury prose-

eutions which demanded that the falsity of a perjured

statement be established by the testimony of two inde-

pendent witnesses. Weiler v. United States, 323 U.S. 606,

65 S.Ct. 548, 89 L.Ed. 495 (1945); United States v. Alu,

236 F.2d 179 (3rd Cir. 1956); United States v. Mc Ginnis,

344 F.Supp. 89 (S.D.Texas 1972); 1970 U.S.Code Cong.

and Admin.News, p. 4007. Accordingly, this Court re-

jected defendant’s requested charge at the close of the

case which would have instructed the jury concerning the

two witness rule.

The argument which defendant advances against Count

V is relatively simple. He reasons that the subornation

statute, 18 U.S.C. 4 1622, is expressly directed only to-

ward perjury as that crime is defined in 18 U.S.C. § 1621

and not toward the making of the false declaration de-

scribed in 18 U.S.C. § 1623. As a result, the defendant

claims he has been illegally found guilty of an offense

which is not a statutory crime. In the alternative, the

defendant contends that if the United States Attorney

argues that it was clear to all concerned that the suborna-

tion charged in the indictment was of perjury pursuant

to § 1621 and merely incorrectly stated as 4 1623, then

the Court erred in its charge to the jury and for this

reason the defendant should be granted a new trial.

34a

Opinion of the United States District Court

for the District of New Jersey

[9] This Court concludes that neither of the defend-

ant’s constructions or explanations for Count V of the

indictment is correct. The subornation statute § 1622

reads: “Whoever procures another to commit any per-

jury is guilty of subornation of perjury.” By utilizing

the term “any” in its legislative language, Congress clear-

ly intended the subornation statute to apply to all per-

jury which it might define and not to be restricted or

limited in its application merely to the offense described

in § 1621. It is also evident that since Congress did not

attempt to amend the subornation statute in 1970 to in-

clude the subornation of a false declaration that it must

have concluded that this offense was already defined in

its prior enactment of 4 1622 just as 18 U.S.C. 4 2, the

aiding and abetting statute applies to all substantive of-

fenses of Title 18 whether they were enacted prior or

subsequent to the statue. For this reason then, this Court

concludes that 18 U.S.C. § 1622 defines the crime of sub-

orning the making of a false declaration as well as the

subornation of what was previously known as perjury.

[10] Category three of the defendant’s motion alleges

gross misconduct by the United States Attorney and, in

particular, his knowing reliance on the perjured testi-

mony of Leonard Wolfram. It should be emphatically

noted at the outset that the perjured character of Leon-

ard Wolfram’s testimony is solely an allegation by the

defendant and not an adjudicated matter.

The basis for defendant’s allegation is that in the

course of eleven lines of transcript, Leonard Wolfram

testified to the details of a conversation he had with Nel-

son Gross in April of 1973. The defendant introduced

evidence at trial which tended to demonstrate that the

35a

Opinion of the United States District Court

for the District of New Jersey

conversation could not have occurred on the date Wolf-

ram reported. The reason for this was that a topic of

their conversation concerned a diary and an entry there-

in. It was established in the course of the trial that this

diary could not have been presented to Gross at the time

of this conversation because it was not known to exist

until more than one week later. The defendant also con-

tends that the United States Attorney was in a position

to know the untruth of Wolfram’s testimony at the time

of his direct examination since the diary in question was

discovered and produced only through the efforts and

specific request of the United States Attorney’s office. As

a result, the defendant concludes that the United States

Attorney acted in bad faith by introducing into evidence

at the trial, testimony which he knew to be false and be-

cause of this prosecutorial misconduct, the defendant

should be granted a new trial.

In reviewing this argument, the Court finds it apparent

that what defendant nows sees to be the sequence of

events in April of 1973 which makes the date and/or sub-

stance of Wolfram’s reported conversation with Nelson

Gross improbable is a product of information which was

produced late in the trial in the course of the defend-

ant’s case by the testimony of the diary custodian, Mrs.

Ruth Smith. It is not apparent to the Court that this

same information or perspective on the events of April

1973 was known by the United States Attorney during

his direct examination of Wolfram let alone at the out-

set of the trial. In fact, the United States Attorney in

his summation conceded the improbability of the diary’s

having been presented to Gross at the time of the re-

ported conversation. As to the testimony of Leonard

36a

Opinion of the United States District Court

for the District of New Jersey

Wolfram this Court has already had occasion to remark

upon the weakness and contradictions inherent therein.

Whatever may be the truth value of Wolfram’s testi-

mony, the issue here is whether the United States Attor-

ney deliberately procured false testimony from a witness

in his conduct of this trial. There are many unanswered

questions raised in the trial of any case but the defend-

ant has produced no telling evidence which would incul-

pate the United States Attorney of such a grievous mis-

conduct as the defendant alleges here.

[11] The other instances of claimed prosecutorial mis-

conduct which the defendant raises on this motion do not

rise to the level of misconduct which this Cireuit de-

mands before a convicted defendant may be granted a

new trial. As the Circuit has indicated, trials are “rarely,

if ever perfect.” United States v. Leftwich, 461 F.2d 586,

590 (3rd Cir. 1972) and errors or acts committed by coun-

sel both for the government and defense, “. . . do not call

for a new trial unless they are so gross as probably to

prejudice the defendant and the prejudice has not been

neutralized by the trial judge before submission of the

ease to the jury.” Jd. 590, cited also in United States v.

Somers, 496 F.2d 723 (3rd Cir. 1974) cert. pending.

The defendant, citing Somers, supra, argues that the

United States Attorney was guilty of prosecutorial mis-

conduct and this deprived the defendant of a fair trial.

I have carefully reviewed the records in this case and I

have concluded that there was no prosecutorial miscon-

duct.

In Somers, the Court of Appeals held certain remarks

of the prosecutor in his opening statement to the jury

37a

Opinion of the United States District Court

for the District of New Jersey

were improper in that they constituted “overly dramatic

unnecessary characterizations” of the defendants and

their conduct. Id. 21-22 and n. 26 (Slip opinion filed March

27, 1974). The Court also found improper two additional

comments of the United States Attorney wherein he

indicated that he possessed information not in evidence

which implicated the defendants. Jd. 24-25.

In the present case, it should be noted that this was a

long trial (five weeks) and hard fought by both sides.

The jury heard the testimony of nine government wit-

nesses and 20 defense witnesses, including the defendani

himself.

There is nothing in the alleged improper remarks of

the United States Attorney that can fairly be construed

as a personal attack on the defendant, as comment on

evidence outside the record implicating the defendant or

as an opinion of the United States Attorney on the de-

fendant’s guilt. The defendant uses the phrase “prose-

eutorial misconduct” as a catchword to reargue the ad-

missibility of certain evidence and the scope of cross-

examination of defense witnesses. Falling into this cate-

gory are such alleged improprieties as the introduction

into evidence of Wolfram’s “prejured” testimony, Mce-

Crane’s Fifth Amendment plea before the Grand Jury

and defendant’s income tax returns and the cross-ex-

amination of the defendant and his witnesses concern-

ing defendant’s political career, law practice, partner-

ship records and financial] status. The areas which the

United States Attorney attempted to explore on cross-

examination were all “opened up” by defense counsel’s

direct examination. Since this Court permitted both the

introduction of this evidence and this cross-examination,

38a

Opinion of the United States District Court

for the District of New Jersey

the United States Attorney can hardly be accused of im-

proper conduct.

In addition, defendant cites a number of instances

where the United States Attorney allegedly made state-

ments on evidence outside the record. It should be noted

that the defendant’s attorney in his cross-examination

of government witnesses and the defendant in his own

testimony attempted to place the United States Attor-

ney’s office on trial by insinuation and innuendo to the

effect that the United States Attorney himself suborned

perjury. On each oceasion when this occurred through

cross-examination of government witnesses, defense coun-

sel had no bases in fact for his question. During the

course of the defendant’s cross-examination he purposely

interjected news accounts relating to “warfare” between

state and federal law enforcement offices and alleged

“leaks” from the United States Attorney’s office. On each

occasion when this occurred, the defendant’s answers were

unresponsive to the question posed by the United States

Attorney. It is obvious that the testimony pertaining

to the unsupported charges of “leaks” and “warfare”

between law enforcement offices was totally irrelevant to

the guilt or innocence of this defendant on the charges

set forth in the indictment.

[12] I recall, during the cross-examination of Bernard

Striar, a government witnes, counsel for the defendant

asked Striar without any basis in fact if it were true that

an assistant United States Attorney had pointed out the

defendant to Striar in the courtroom in order to assist the

witness in his identification of the defendant. The United

States Attorney thereupon objected and rightly so to the

question and stated that his office did not engage in such

conduct.

39a

Opinion of the United States District Court

for the District of New Jersey

Taken in context, the United States Attorney’s objec-

tion served only to neutralize what I consider to be an

unfair question by defense counsel. Counsel then made

the surprising suggestion in the jury’s presence that the

United States Attorney take the stand and testify to re-

but the insinuation that he had done something which was

tantamount to suborning perjury. The United States At-

torney did not launch an attack upon the defendant, as

was condemned in Somers, but merely defended his office

by making which I consider to be proper objection. De-

fendant was in no way prejudiced by the remark.

[13] I reach the same conclusion as to the question

posed by the United States Attorney concerning “leaks”

from his office. Here the United States Attorney was

provoked by an unresponsive answer of the defendant to

the effect that there were “leaks” emanating from his

office. Moreover, rather than objecting to the United States

Attorney’s questions, defense-counsel insisted that his cli-

ent answer them. The defendant appeared to be waiting

for an opportunity to inject the issue of “leaks” into the

trial.

Shortly thereafter, the defendant gave another unre-

sponsive answer wherein he recalled reading newspaper

accounts concerning a so-called war between the United

States Attorney's office and the State Attorney General’s

office over the investigation of the Writer’s Associate in-

voice. “he United States Attorney attempted to cross-

examine defendant concerning this alleged incident but

was prohibited by this Court. However, I do not find

anything stated by the United States Attorney which con-

stituted misconduct in the sense of implicating the defend-

ant or expressing an opinion as to guilt. Again I find

that defendant was not prejudiced by the incident.

Sattieetnetiiattitnen an tee

40a

Opinion of the United States District Court

for the District of New Jersey

Defendant cites other instances of alleged prosecutorial

misconduct. As to the United States Attorney’s refer-

ence to “arson” during the cross-examination of the de-

fense witness Albanese, I conclude there was no prejudice.

I consider this Court’s prompt cautionary instructions to

be effective and sufficient to protect the defendant. I

reach the same conclusion as to the partial] question asked

of Albert Gross: “Did there come a time when you were

personally sued by trustees . . .?” Defense counsel in-

terrupted the question with an objection. Again I consid-

er my stern cautionary instructions sufficient to protect

the defendant from any prejudice.

[14] Defendant cites several other alleged instances of

prosecutorial misconduct. Many of these were not ob-

jected to at trial. Accordingly, the defendant cannot raise

them on his post trial motion. See United States v. Som-

ers, supra at 29-30; United States v. Lawson, 337 F.2d

800, 807 (3d Cir. 1969) cert. denied 380 U.S. 919, 85 S.

Ct. 913, 13 L.Ed.2d 804 (1965). After carefully review-

ing this record in its entirety, I conclude there was no

“prosecutorial misconduct” and the defendant was not de-

nied a fair trial. As a result defendant’s motion for a

new trial based on his third category of objections is also

denied.

[15] Finally, the defendant raises what he considers

to be a serious constitutional infirmity in this District’s

jury selection plan. He argues that the plan in effect in

this District systematically excludes attorneys, public of-

ficials, professional or business persons and others of high

income.

Whatever merit there may be in defendant’s allegation

a reading of the precedents available in this Circuit, as

4la

Opinion of the United States District Court

for the District of New Jersey

well as in the United States Supreme Court, leads me to

conclude that defendant’s motion comes too late. Although

the precedents that the Court will rely upon deal with

the composition of Grand Juries, I consider these cases

closely analogous both factually and legally. The selec-

tion of petit and grand juries is governed by a single

statutory provision 28 U.S.C. § 1867 which requires all

objection to the method of the jury’s selection be raised

prior to the voir dire, 28 U.S.C. § 1867 (a) and (e). As

a result, the failure to raise a timely objection on these

grounds has been held to constitute a waiver based on

policy considerations underlying Fed.R.Crim.P. 12(b) (2),

Davis v. United States, 411 U.S. 233, 93 S.Ct. 1577, 36

L.Ed.2d 216 (1973); United States v. Noah, 475 F.2d 688

(9th Cir. 1973); United States v. Zirpolo, 450 F.2d 424

(3rd Cir. 1971). That policy has alternatively been ex-

pressed as the need for an orderly process of criminal

procedure with sanctions of forfeiture for those who seek

to avoid the impact of procedural rules, Fay v. Noia, 372

U.S. 391, 482, 83 S.Ct. 822, 9 L.Ed.2d 837 (1963) or final-

ity in criminal judgments, Thornton v. United States, 125

U.S.App.D.C. 114, 368 F.2d 822 (1966). These formalis-

tic considerations, however, have repeatedly been over-

turned when serious questions concerning the denial of

constitutional rights have been asserted, Kaufman v.

United States, 394 U.S. 217, 288, 89 S.Ct. 1068, 22 L.Ed.

2d 227 (1968); Sanders v. United States, 373 U.S. 1, 83

S.Ct. 1068, 10 L.Ed.2d 148 (1963). As the Supreme Court

said in Sanders: “. . . conventional notions of finality of

litigation have no place where life or liberty is at stake

and infringement of constitutional rights is alleged.” Id.

p. 8, 89 S.Ct. p. 1073.

42a

Opinion of the United States District Court

for the District of New Jersey

These legitimate governmental interests in forfeiture

and finality have added weight, however, when the con-

victed criminal defendant alleges unconstitutional com-

position of a jury in whose selection he actively and vig-

orously participated. To grant relief in this context

would have the Court approve and participate in the de-

fendant’s trial tactics which involve the deliberate avoid-

ance of Congressionally approved procedural require-

ments. If the Court consented to such a course of action,

then for every defendant, “(S)trong tactical considera-

tions would militate in favor of delaying the raising of

the claim in hopes of an acquittal, with the thought that

if those hopes did not materialize, the claim could be used

to upset an otherwise valid conviction at a time... .”,

Davis v. United States, 411 U.S. 233, 241, 98 S.Ct. 1577,

1582, 36 L.Ed.2d 216 (1972).

In the present case, this Court will not be a party to

these tactics. The defendant here offers no plausible ex-

planation for his failure to make timely objection to the

composition of the jury. The method of selecting the jury

panel has been utilized in this District since 1968 and it

was implemented pursuant to the standards of 28 U.S.C.

§ 1861 et seq. No reason has been suggested why the de-

fendant or his counsel could not have ascertained the in-

formation relative to his present objection prior to trial

or, at least, in the course of the very thorough voir dire

of each juror individually and in chambers by the Court

with the defendant present as well as counsel for the gov-

ernment and the defense. This Court also does not per-

ceive how prejudice to the defendant’s right to a fair trial

could have resulted from the jury which was actually se-

lected. For these reasons, this Court denies defendant’s

43a

Opinion of the United States District Court

for the District of New Jersey

motion for a new trial on the basis of his fourth category

of objection and it also denies his application for an evi-

dentiary hearing concerning the jury selection practice

pursued in this District.

It is, therefore, ordered, this 15th day of May, 1974

that defendant’s motion for a judgment of acquittal pur-

suant to Fed.R.Crim.P. 29(c) and in the alternative for

a new trial pursuant to Fed.R.Crim.P. 33 be and the same

are hereby denied.

44a

Affidavit of Joseph M. McCrane, Jr.

UNITED STATES COURT OF APPEALS

For tHe Taurep Crrcurr

No. 74-1697

—s

Untrep States or AMERICA,

v.

Netson G. Gross,

Appellant

——~>

JosepH M. McCrang, being duly sworn according to law,

deposes and says:

1. That he was named by the Grand Jury as a co-con-

spirator with Nelson G. Gross in Count 1 of the indict-

ment in United States v. Nelson G. Gross, Criminal Action

No. 324-73 in the United States District Court for the

District of New Jersey and that he was named as a co-

conspirator with Gross by amendment of Count 3 of the

same indictment. It is from Gross’ conviction on that

indictment that this appeal is taken.

2. That he was indicted as of Criminal Action No. 341-

73 in the United States District Court for the District of

New Jersey two days after Gross had been indicted as

mentioned above. Gross was mentioned as a co-conspira-

tor with him in Count 1 of this indictment, which in-

45a

Affidavit of Joseph M. McCrane, Jr.

volved, in part, the same matters which were the subject

of Gross’ indictment.

3. That on April 27, 1973, before either of the above-

mentioned indictments was returned by the Grand Jury,

he was called before the Grand Jury and exercised his

right under the Fifth Amendment not to testify.

4. That daring the trial of Nelson Gross on the above-

mentioned indictment, bis attorney notified counsel for

Gross and the government that he would exercise his

Fifth Amendment right not to testify if he were called

as a witness and, accordingly, that he did not testify in

that case.

5. That on December 10, 1974, he was acquitted on

Count 1 of the indictment against him, charging a con-

spiracy to “[dJefraud the United States by impeding, im-

pairing, obstructing and defrauding the lawful govern-

mental functions of the Internal Revenue Service of the

Treasury Department of the United States in the ascer-

tainment, computation, assessment and collection of reve-

nue, to wit, income taxes . . .,” essentially the same charge

involved in Count 1 of the indictment against Gross and

Count 5 charging him with aiding and assisting “The

Grand Union Company and its includable subsidaries (in-

cluding the Stop and Save Trading Stamp Corporation)

to prepare and present to the District Director of Internal

Revenue .. .” a false and fraudulent corporate income

tax return, essentially the charge contained in Count 2

of the indictment against Gross.

6. That, having read the testimony of Preis and the

summation of United States Attorney Jonathan Goldstein

46a

Affidavit of Joseph M. McCrane, Jr.

at the trial of Nelson Gross, he knows that the verdict

was based, at least in part, on incorrect testimony.

7. That, having been acquitted of the charges against

him involved in the case against Nelson Gross, he has

been advised by his counsel that there is no longer any

basis or reason for him to assert his Fifth Amendment

right not to testify on behalf of Nelson Gross and that,

in order to avoid a miscarriage of justice, he is now pre-

pared to testify as follows:

“(a) The first time I ever met Nelson Gross was

at the 1968 Republican National Convention; and

then only very casually. I believe I met him again

at the inauguration of President Nixon in January,

1969, and then not again until the June 1969 pri-

mary campaign for Governor. Immediately after

the June election, I went to a wedding reception

for Paul Sherwin’s daughter, attended also by

Congressman Cahill and Nelson Gross. Mr. Cahill

told us then that Mr. Sherwin would be the cam-

paign manager for the fall campaign, that I was

to report to Sherwin in my capacity as financial

chairman and Nelson Gross was to be State Chair-

man, but to report to Sherwin for overall direction

of the campaign. From that time up to the date

of the election in November, our coordination was

through Mr. Sherwin and I don’t ever remember

seeing or talking to Nelson Gross. He attended

no finance meetings and I attended no campaign

meetings. In fact, we were told to cover separate

areas so as not to duplicate our efforts. I did

receive certain lists of prospects from Nelson Gross

in Bergen County and did receive from him through

Mr. Sherwin, the names of Ned Jesser and William

47a

Affidavit of Joseph M. McCrane, Jr.

Preis as prospective hosts of fund-raising cock-

tail parties for Bergen County.

“(b) I visited with Ned Jesser and also visited

Mr. Preis separately at his South Hackensack office

on August 14, 1969. At that time Mr. Preis agreed

to co-host a party and also pledged on behalf of

Triple S Blue Stamp Corporation a contribution

of $5,000. Mr. Preis asked how the company could

fulfill the pledge in a confidential manner so as to

avoid possible difficulties with stockholders and cus-

tomers who did not want support indicated as to

any candidate. I said that the corporation could

make its payment to Writers Associates which was

receiving campaign contributions and paying cam-

paign expenses. At no time was there any dis-

cussion of taking a tax deduction for the contribu-

tion.

“(c) Sometime after the party at Arcola on Sep-

tember 9 which Mr. Preis co-hosted, although he

did not attend, I asked Miss Sue Phillips of Writers

Associates whether the $5,000 pledge had been

paid. Seeing that it had not been, I asked her to

send out a reminder notice. This she did in the

form of a Writers Associates invoice, which we

used in certain cases to preserve confidentiality

because Writers Associates was asigned to pay

certain expenses of the campaign. There was no

other person or company in Bergen County that

received such an invoice, and it happened in this

case only because the $5,000 contribution had not

been paid though several weeks had passed since

the pledge of August 14, 1969.

48a

Affidavit of Joseph M. McCrane, Jr.

“(d) At no time did I tell Nelson Gross that a

Writers Associates invoice was being sent to Mr.

Preis. At no time did Nelson Gross ask me to

send Preis a bill, voucher or invoice in any form.

In fact, at no time did Nelson Gross have any dis-

cussion with me at any time concerning Writers

Associates, the payment of bills, or any means by

which contributors could obtain tax deductions for

campaign contributions. Moreover, to my knowl-

edge, Nelson Gross never knew that Writers Asso-

ciates even existed or who Dick Smith was.”

6. That he has read the testimony of Preis that Nelson

Gross told him not to worry because he [McCrane] would

“plead the Fifth [Amendment]” before the Grand Jury.

With respect to this testimony, he is prepared to testify

on behalf of Gross as follows:

“At no time prior to my assertion before the

Grand Jury on April 27, 1973, of my right not to

testify on Fifth Amendment grounds, did I ever

tell Nelson Gross that I would assert such a plea.

Indeed, until April 21, 1973, well after Gross’ pur-

ported statement to Preis, I had not discussed with

my attorneys or anyone else what action I would

take if I were to be called before the Grand Jury.

In fact, I was out of the country on a vacation

when a Grand Jury subpoena was served upon my

wife on April 6, 1973, and I did not return to the

country so that I could discuss this matter with

anyone until April 21, 1973.”

s/ JosepH M. McCrange, Jr.

(Sworn to February 25, 1975.)

49a

Excerpts from Transcript of Proceedings

In THE

UNITED STATES DISTRICT COURT

FOR THE District or New JERSEY

Criminal No. 324-73

—-—

Unirep States or AMERICA,

Plaintiff,

vB.

Netson G. Gross,

Defendant.

—~>

April, 1974

(2753)* I will hear those legal arguments.

(The jury left the courtroom, and the following pro-

ceedings were had without the hearing or presence of the

jury :)

Mr. Besser: Maybe your Honor knows something I

don’t know.

The Court: I thought you alerted him.

Mr. Goldstein: No, I haven’t alerted my adversary up

to this point, but I will right now.

* Figures in parentheses refer to each new page of the Steno-

graphic Transcript.

50a

Colloquy

The Court: You told me you have a legal problem.

Mr. Goldstein: I have a matter that counsel should be

alerted to in advance because it is an evidentiary prob-

lem, evidentiary matter that I think is clear, and the

United States has briefed the point.

I have briefs with me.

I do not want to have tomorrow, when I present this

witness, I do not want to have Mr. Besser making all

kinds of objections.

I’m going to submit to the Court briefs on this point.

Miss Costello, there is an original and a copy here.

What I bring to the Court’s attention is the following:

I intend to introduce tomorrow, your Honor, (2754) in

proving the conspiracy set forth in Count 3, that this de-

fendant, Nelson Gross, assured Mr. Preis on April 12 of

last year that he had nothing to be concerned about, noth-

ing to fear, that only two people could contradict this

story, and that he didn’t have to worry about being in-

dicted for perjury, no one could prove, no women—only

two people who could contradict the story, and those two

people being Nelson Gross and Joseph McCrane.

The testimony has been replete on Friday and through

the course of examination of this week the testimony has

been that Gross says to Preis, “I’m not going to talk,

and as to MeCrane, when his hearing comes up, he’s going

to take the Fifth Amendment.”

I intend to introduce tomorrow, your Honor, by calling

the stenographer who was present at the Grand Jury

proceedings, I’m going to introduce corroboration of Mr.

Preis’ testimony that this defendant told him, “Don’t

worry about any perjury indictments, it’s only McCrane

and I, McCrane will take the Fifth Amendment,” I’m go-

ing to prove that pursuant to this conspiracy set forth

dla

Colloquy

in Count 3, that MeCrane did in fact just as Nelson Gross

told Mr. Preis, Mr. McCrane did in fact take the Fifth

Amendment and did in fact refuse to answer questions be-

fore the Grand Jury.

That is the proof I intend to offer tomorrow.

(2755) I anticipate that Mr. Besser is going to object

to that proof.

We have carefully briefed that argument, your Honor.

I have now submitted the brief to the Court and to my

adversary.

I don’t want to have this come up tomorrow and then

have to delay the jury for a day while we argue back

and forth and counsel asks for time to brief the point.

So I thought in fairness to everybody I’d raise the issue

this afternoon before we go forward tomorrow, and this

will enable counsel, if he wishes, he may have no objec-

tion at all, but if he wishes to submit a brief to the Court,

if not, your Honor does have the Government’s brief.

(2756) Mr. Besser: Mr. Goldstein’s concern for this

jury and fairness to the defendant is heart-warming. This

brief must have been turned out, must have been con-

templated weeks ago when Mr. Goldstein first wrote your

Honor a little letter saying that he was going to name

McCrane as an additional conspirator under Count III.

I cannot believe, in fact I don’t think he would dare

make the statement to your Honor that it wasn’t until

today that he conceived of the idea of putting into evi-

dence that which he wishes to offer tomorrow.

If he wanted to be fair, if he didn’t want to delay this

jury and he wanted to help this defendant out of his con-

cept of fairness, he could have given us this brief when

he started this trial, your Honor. But that’s neither, nor

there.

52a

Colloquy

The attempt to get before this jury the inflammatory

evidence of Joseph MecCrane, who pleaded the Fifth

Amendment, I think is the mark of a desperate prose-

cutor.

I am really amazed that he would risk the obvious

prejudice here to buttress off what he apparently thinks

is otherwise a good prosecution by something that is so

risky and so fraught with peril and so obviously preju-

dicial.

Careful prosecutors don’t take chances. (2757) Desper-

ate prosecutors take chances, if the Court please.

T object to it.

I’m not going to submit a brief, your Honor. I think

it is patently prejudicial, and I will not submit a brief

tomorrow because I don’t think there is a case that says

two plus two equals four. I think we all know that two

plus two equals four.

The Court: Mr. Besser, they have heard that testimony

twice already, my notes reveal.

Mr. Besser: So that’s it.

The Court: And I think Preis on direct examination

and I think you also brought it out on cross-examination—

Mr. Besser: He probably volunteered it. He was very

good at that.

But, in any event, they have certainly heard it; your

Honor is right.

I don’t think under the guise of that they should now

be permitted to show that that which was promised came

to be.

It is too risky. It is too fraught with prejudice, if the

Court please.

That’s the argument. The Court will make its ruling.

The Court: Yes, Mr. Goldstein?

53a

Colloquy

Mr. Goldstein: Your Honor, I just want to say (2758)

one thing: I don’t intend at this time to argue the law; the

law is set forth very clearly.

: _— your Honor should have a chance to read the

rief.

But, Mr. Besser, this is no act of a desperate prose-

cutor, to set the record straight.

Part of this conspiracy, your Honor, was to cover up

and to hide that this kind of campaign contributions were

being solicited in 1969 and that in 1969 to solicit these

kind of contributions businessmen were given fictitious,

false and fraudulent invoices to write it off so that they

can get business deductions so that it could cost the busi-

nessman nothing or maybe half and so it would swell

the coffers of the people who were running at that time

the gubernatorial campaign of William T. Cahill.

That’s what they were doing.

And last year now, fraught with fear that this would

all be disclosed when the Grand Jury began to investi-

gate, then they began to pull their horns in and they then

began to go to the witnesses we have heard for the last

four days of testimony, and they told witnesses to lie,

perjure themselves, nothing to worry about, it’s a fish-

ing expedition; when indicted, it’s a flimsy indictment,

constantly reassuring these witnesses that they had noth-

ing to fear, all along protecting their own (2759) posi-

tion and their own criminality in 1969.

Now, your Honor, the United States seeks to prove not

from any act of desperation, but to show the depths and

the lengths that this defendant and his co-conspirators and

McCrane is a defendant in a case that is before this

court—-to show the depths that this defendant and his

co-conspirator, McCrane, went to, that this defendant as-

54a

Colloquy

sured price “You have nothing to worry about, Mr. Preis,

because the only way they can get you for perjury is if

either McCrane or I testify against you.”

(2760) Me you don’t have to worry about. That’s true,

he’s telling a lie, and McCrane, when he comes up for

his hearing he’s going to take the Fifth Amendment. That

is exactly what Joseph MeCrane did before the United

States Grand Jury. He took the Fifth Amendment before

that Grand Jury.

That proof, your Honor, goes to the very gut and the

heart of the conspiracy that is before this jury. That

proof, your Honor, goes to show that cover-up, to show

how this defendant and his cohorts sought frantically dur-

ing the early part of last year to try to cover up, hide

and conceal, and when that wasn’t enough, to subborn per-

jury so the investigation of this United States Grand

Jury could be thwarted.

I think that proof is not only proper but it should be

before this jury so it can make a full and final deter-

mination as to the guilt or innocence of this defendant.

Mr. Besser: Your Honor, if the people who wrote the

Fifth Amendment heard what Mr. Goldstein said, they

would turn over in their graves. The pleading of the

Fifth Amendment, says Mr. Goldstein, is a cover-up.

Mr. Goldstein: There is a difference. You didn’t listen

very carefully.

Mr. Besser: I am sorry, I withdraw my (2761) re-

marks. I don’t want the speech again.

Your Honor, may I speak very frankly. Every lawyer

likes to have an anchor to windward in a criminal trial,

and if ever I saw an anchor to windward it would be the

admission of this kind of proof.

dda

Colloquy

Now, I have made my objection, if the Court

ease.

The Court will do what it wants to do. “

The Court: I am going to read the cases and I will

decide it in the morning. The Court is in recess.

7 adjourned to Thursday, March 14, 1974, at 9:30

a.m.

s 9 @

(2764) Mr. Besser: Before your Honor’s ruling on this

application I should put something on the record and I’d

like to do it at sidebar.

(Counsel approached sidebar :)

Mr. Besser: Judge, before your ruling on this proffer

by Mr. Goldstein as proof that Mr. McCrane pleaded the

Fifth Amendment, pleaded this privilege, refused to tes-

tify when he was called before the Grand J ury last spring,

between yesterday’s session and this morning I have been

in telephone communication with MecCrane’s lawyer, Mr.

Lummey in New York.

ware Court: I thought Grover Richmond represented

Mr. Besser: They are co-counsel, I think.

Mr. Lummey tells me that if I were to subpoena Mr.

McCrane to testify in this proceeding with respect to the

circumstances under which he pleaded the Fifth Amend-

ment before the Grand Jury he would exercise his privi-

lege and refuse to testify.

The Court: Here?

Mr. Besser: Here. He also advised me—and I have

only his verification for it—but I would have thought

that out of this wonderful concept of fairness that Mr.

Goldstein makes mention of ail of the time, that last

spring, when the United States Attorney’s Office was

56a

Colloquy

(2765) trying to subpoena Mr. McCrane to testify before

the Grand Jury, Grover Richmond, MeCrane’s lawyer,

wrote Mr. Goldstein, or Mr. Stern, a letter saying that

McCrane, if he did appear before the Grand Jury, would

exercise his privilege and refuse to testify.

So that’s all I add to the record on the basis of which

your Honor will now have to make a ruling.

The Court: Why? What have you got to say, Mr.

Goldstein?

Mr. Goldstein: I just want to put a couple of things

in context.

Three days—I should put it this way: In the period

of time that Mr. Gross learning about the Writers As-

sociates invoice the very next thing that happens is that

Mr. McCrane leaves for Antigua, suddenly, and flees the

country.

Mr. Besser: Why don’t you try to put that in, too?

Mr. Goldstein: As a matter of fact, I was thinking

about that last night, Mr. Besser, because I think flight

happens to be the best proof of all as to criminal in-

tent on the part of both a defendant and a co-conspirator,

which Mr. McCrane is.

McCrane fled this jurisdiction during the pendency of

this Grand Jury investigation.

(2766) I think that should be on the record, as well.

The Court: I don’t know why you call to my attention

that Mr. McCrane, if he was subpoenaed here—

Mr. Besser: Because if it gets in I am totally disabled

from eliciting from Mr. MeCrane the fact that he exer-

cised his privilege before the Grand Jury on advice of

counsel.

I can’t even put that in by way of rebuttal. I am totally

disabled.

57a

Colloquy

I can’t meet it in any way.

The Court: Let’s digress for a few minutes.

Mr. Greenberg appeared in my chambers this morning

“7 = packages of what he said were checks. I did

a coh oy them. Now he wants to make a statement on

I assume you want to look at them, to ’s goi

to delay these proceedings? a

Mr. Besser: No, not at all.

I will have someone look at it while we proceed.

(2871) Boeing Airplane Co. v. O’Malle

(8th Cir. 1964) ; United States v. DelPunthtorio, ii Fa

84 (2d Cir. 1969). This discretion is likewise addressed

by F. R. Crit. P. 6(2) to the disclosure of testimony be-

fore the Grand Jury. Because this Court considers the

testimony in question relevant and because its prejudicial

effect is not apparent as a result of the same testimony

having been elicited by both the government and defense

at an earlier point in this trial, this Court has decided to

re 7 oe into evidence.

0 owev ill gi j i i

aa er, will give the jury cautionary in-

~ be Aa - ag Bring the jury down.

r. Besser: Co our Honor

ona oe _ please tell me now what

The Court: The jury is here.

Members of the jury, I am permitting this testimony

for limited purposes: Namely, (1) Mr. McCrane appeared

before the Grand Jury: (2) that he asserted his right

to refuse to testify; (3) that it may corroborate the tes-

timony of Mr. Preis to the effect that Mr. Gross informed

him of what Mr. McCrane would do.

58a

Colloquy

You should not consider it as bearing on whether Mc-

Crane would have incriminated himself or the defendant

(2782) here by testifying before the Grand Jury.

Mr. Besser: Your Honor, I don’t think that that in-

struction is correct at all.

The Court: You don’t?

Mr. Besser: I think they should be told, in the first

place, that it may corroborate. That’s for summation.

I believe that the Court should say, “I have permitted

it,” and they are to make no inferences one way or the

other.

The Court: They may or may not.

Mr. Besser: Certainly. I think you should tell them

very specifically that he has an absolute Constitutional

right to plead the Fifth Amendment before the Grand

Jury, that this was an investigation of which he was the

specific target, and he had an absolute right on advice of

counsel to plead the Fifth Amendment.

This is a right basic to every person, to choose not

to testify, as, indeed, as we have seen in this court.

Mr. Goldstein: On the contrary, your Honor, given the

testimony in this case—

Mr. Besser: Excuse me. And also that your Honor

should tell the jury that the United States Attorney and

before he was called to testify was told by McCrane’s

lawyer that he would not testify.

(2783) Mr. Goldstein: Your Honor, if Mr. Besser wants

to put this entire matter in total perspective then I would

suggest to the Court that as soon as it became known

to these defendants that the United States Grand Jury

knew of the Writers Associates invoice, McCrane fled

the jurisdiction of the United States, went to Antigua

on a boat and was incommunicado to the Grand Jury

59a

Colloquy

and was incommunicado to the United States Attorney’s

It was only after an order of this Court that McCrane

was brought back on a court order to the United States.

P It was then that Mr. McCrane went before the Grand

ury.

And just as Mr. Gross told Mr. Preis, he invoked his

Fifth Amendment privilege in that Grand Jury.

(2784) The Court: On advice of counsel.

Mr. Goldstein: No. :

The Court: Isn’t that so? .

Mr. Goldstein: No, your Honor. The testimony is that

Mr. Gross told Mr. Preis that Mr. Gross knew he was

going to invoke his Fifth Amendment privilege.

And it is not a question of it being on advice of coun-

sel or not, the proof that’s being offered by the United

States is that Mr. Gross in order to convince Preis,

“You can go in there and lie and not worry absut it,

not only is it a fishing expedition, not only does the Gov-

ernment have to prove that you actually lied, there were

no women, but only two people can contradict you, Mr.

Preis, that’s me, and MeCrane, and I know that McCrane

is going to take the Fifth.”

It doesn’t matter, your Honor, under what basis Mc-

Crane takes that Fifth Amendment.

The point of the matter is that Gross in order to sub-

born the perjury of Preis tells Mr. Preis, “I know Mce-

Crane is going to take the Fifth Amendment.”

And that is to convince Mr. Preis to go into that Grand

Jury and lie so that both McCrane and Gross are pro-

tected, so that the Grand Jury does not (2785) get be-

hind Mr. Preis’ lies.

And that’s the essence of the testimony we seek to

elicit.

60a

Colloquy

It is to corroborate Mr. Preis’ testimony here in this

courtroom and to show to this jury how this defendant

tried to reassure and convince Mr. Preis that he had noth-

ing to fear because it was only him and McCrane that

could in effect turn him in or turn evidence in against

him.

That’s the basis of the testimony.

And it matters not on what basis Mr. McCrane decides

to take the Fifth.

This defendant, Nelson Gross, knew he was going to

take the Fifth, and used that knowledge, your Honor, in

order to convince Mr. Preis to perjure himself in the

Grand Jury. )

The Court: Anything else?

Mr. Besser: No.

The Court: I’m going to add to the instructions which

I have just read from my prepared notes here, I will also

instruct you that Mr. MecCrane had the right to invoke

his constitutional privilege.

Bring the jury down, please.

Can’t we dispose of the other witness before we—

(2855) [Counsel returned from side bar, and the fol-

lowing proceedings were had within the hearing and pres-

ence of the jury:]

The Court: Let the record note that I deny the Gov-

ernment’s application to place the information designated

as G-53 into evidence.

Mr. Goldstein: Your Honor, the judgment of convic-

tion and the information.

The Court: Denied.

Mr. Goldstein: May we proceed with the next witness?

The Court: Call the next witness, please.

Mr. Goldstein: United States calls Doris Perla.

6la

Doris Perla—for Government—Direct

Doris Pera, called as a witness by the Government,

being first duly sworn, testified as follows:

Direct examination by Mr. Goldstein:

Q. Where do you reside, ma’am? A. 368 Thomas Ave-

nue, Lyndhurst.

Q. What is your business or occupation? A. Certified

Shorthand Reporter.

Q. What do you mean by “Certified Shorthand (2856)

Reporter”; tell the jury what that is, ma’am. A. You

are—you take a State exam and you are certified by the

Board, and then you can take legal proceedings.

Q. Do you mean by “legal proceedings” just as Mr.

Sokol before you is taking down my questions and your

answers? A. Right.

Q. Is that correct? A. Yes.

Q. And you are certified to the point that you are at

least 95 per cent accurate in transcribing the words that

are uttered in a court proceeding; is that correct? A.

Yes.

Q. And you have been so certified? A. Yes, I have.

The Court: For how long?

The Witness: A year, over a year.

Q. Directing your attention to April of last year, April

1973, Mrs. Perla, by whom were you employed? A. Waga

& Spinelli.

Q. Would you tell us what the business of Waga &

Spinelli is? A Agency of Certified Shorthand Reporters.

(2857) Q. Was the agency of Waga & Spinelli engaged

to transcribe the minutes of the United States Grand Jury

Pew.

Doris Perla—for Guvernment—T irect

here in Newark, New Jersey, in this cou.:thouse? A. Yes,

they were.

Q. And did you have occasion to transeribe minutes of

proceedings in the Grand Jury? A. Yes, I did.

Q. Did you have occasion to transcribe the proceedings

of the Grand Jury in which one Joseph McCrane was

called to testify? A. Yes, I did.

Q. Have you brought with you your transcription notes

of the questions and the answers that were asked Mr.

McCrane before the Grand Jury? A. Yes, I have.

Q. Would you tell us, ma’am, when did this hearing

take place; can you tell us the data? A. April 27, 1973.

Q. And who was the witness? A. Joseph M. McCrane.

Q. Have you brought with you also a transcription, a

typed transcription of your shorthand notes? A. Yes,

I have.

Q. Could we identify your shorthand notes, if you’d be

good enough?

(2858) These papers here I hold in my hand are your

stenographic notes of that hearing, are they not? A.

Yes.

Mr. Goldstein: May we mark this with the next

exhibit number?

{Exhibit G-56 marked for identification. ]

Mr. Besser: Identification?

Mr. Goldstein: Identification only.

Mr. Besser: Where is my copy?

Mr. Goldstein: I gave it to you at side bar.

Mr. Besser: My copy of those notes.

The Court: Let Mr. Besser read the notes. We

will declare a recess.

63a

Doris Perla—for Government—Direct

Q. Those notes were later transcribed, were they not?

A. Yes.

Q. At my request, did I ask you yesterday to compare

your transcribed notes with the actual transcription? A.

Yes, you did.

P And you did so compare it, did yon not? A. Yes, I

Q. Now, you have before you, do you not, the entire

transcription of the proceedings of that day, have you not?

(2859) A. Yes, I do.

Mr. Goldstein: May we mark this as the next

Government exhibit number?

‘[Exhibit G-57 marked for identification. ]

Mr. Goldstein: And may I mark this as the next

exhibit number?

{Exhibit G-58 marked for identification. ]

Mr. Besser: What was the first one?

Mr. Goldstein: G-57 is the entire Grand Jury

proceeding.

Mr. Besser: May I see it?

Mr. Goldstein: Sure.

The Court: What’s 58?

Mr. Goldstein: G-58 is the excerpted portion of

the Grand Jury proceedings that I showed your

Honor at side bar.

Q. I am going to show you Government Exhibit 58, Mrs.

Perla.

64a

Doris Perla—for Government—Direct

Can you look at that and can you tell us whether or not

that reflects the questions and answers that were asked

by then United States Attorney Herbert Stern of Mr.

McCrane?

If you’d like to compare it with your full transcribed

copy I have no objection to that at all, to make sure that

they are accurate. (2860) A. Okay.

Q. If you would first compare the excerpted copy, G-58,

and make certain that within the excerpted copy it is all

reflected accurately in the full transcribed minutes, and

once we’ve done that I’ll ask you some questions.

Have you compared the excerpted copy which, I believe,

is G-58, with Government Exhibit 57 for identification?

A. Yes, I have.

Q. Exhibit G-58, which is the excerpted copy, is it an

accurate recitation of the questions that were asked by

Mr. Stern of Mr. McCrane in the Grand Jury room? A.

Yes.

Q. Would you be good enough, Mrs. Perla, to read the

excerpted copy to the jury at the present time?

Can I help you?

A. “Joseph M. McCrane, Jr., sworn.

“Examination by Mr. Stern:

“Question: What is your name, sir?

“Answer: Joseph M. McCrane, Jr.

“Question: Where do you reside?

“Answer: Rancocas, New Jersey.

“Question: All right—”

(2861) Mr. Goldstein: That reflects a gap now,

you have excerpted out certain questions?

The Witness: Yes.

65a

Doris Perla—for Government—Direct

; Q. Okay. A. “Question: All right, Mr. McCrane, what

is your business or occupation?

Bee I = Treasurer of New Jersey.

estion: t is your i i

a. your business or occupation

“Answer: I refuse to answer that or any fur-

ther questions on the grounds that the answer to

that question or any further questions might tend

to incriminate me.

“Question: You mean the answer to what you

presently do for a living might tend to incriminate

yout You can take the Fifth Amendment if you

wish. I just want to make sure you understand.

“Answer: I don’t know what the proper terms

are. All I know is I am just supposed to answer

my name, rank and serial number, and other fur-

ther questions I am to say I refuse to answer that

question or any further questions on the grounds

that the answer to that question or any further

questions might tend to incriminate me.”

(2862) Then it shows—

Q. There is more? A. There is more.

“Question: Ai2 you aware of the firm known as

Writers Associates?

“Answer: I restate the position that I have al-

ready taken, which is I refuse to answer that ques-

tion or any further questions on the grounds that

the answer to that question or any further ques-

tions might tend to incriminate me.

“Question: Did you direct anyone to issue false

and fictitious invoices from Writers Associates to

66a

Doris Perla—for Government—Direct

Hialeah Race Track, Atlantic City Racing, Cresci

Aviation, Camden Trust Company of New J ersey,

the Stop and Save Company, Interser International,

Trap Rock Construction Company or Passaic Pave-

ment Company?

“Answer: I restate the position that I have al-

ready taken, which is I refuse to answer that ques-

tion or any further questions on the grounds that

the answer to that question or any further ques-

tions might tend to incriminate me.”

Q. Then there is another gap? A. Yes. And then Mr.

Stern, “Thank you, Mr. McCrane. Witness excused.”

Mr. Goldstein: Thank you very much. No (2863)

further questions.

I ask that the excerpted copy be marked into

evidence at this time.

(Exhibit G-58 received and marked in evidence.)

The Court: Cross-examination?

Mr. Besser: No questions.

The Court: You may step down.

Members of the jury, listen to me very care-

“2. Goldstein: Your Honor, I think Miss Perla

would like to take these back. They are her official

records.

The Court: Again, members of the jury, listen

to me very carefully. I am permitting this testi-

mony for limited purposes, namely, one, that Mr.

McCrane appeared before the Grand Jury.

Two. He asserted his rights and refused to tes-

tify.

67a

Colloquy

Three. That is may or may not corroborate the

testimony of Mr. Preis to the effect that Mr. Gross

informed him of what Mr. McCrane would do.

You should not consider it as bearing on whether

McCrane would have incriminated himself or the

defendant hereby testifying before the Grand Jury.

I also instruct you that Mr. McCrane had the

(2864) right to invoke his constitutional privilege,

that is, taking the Fifth Amendment, and I so in-

struct you.

Call your next witness.

Mr. Goldstein: The United States rests.

Mr. Besser: Your Honor, before Mr. Goldstein

rests, I asked him two minutes ago whether he was

prepared to rest and he said the didn’t know. I

think I should address the Court at side bar.

The Court: Come over, please.

(Whereupon the following was had at side bar:)

Mr. Besser: Before he rests, your Honor, I do

want to move to strike the testimony of Suzanne

Phillips Miller. You will recall it related to her

testimony based on those ledger sheets of Writers

Associates that had paid expenses of the Cahill

campaign.

Now, he brought that out on the basis of the

ledger sheets. On cross-examination it was very

clear that Suzanne Phillips Miller had no familiar-

ity with those ledger sheets, had never seen them

until the day before in Mr. Goldstein’s office. They

were not made under her supervision. She could

not testify on the basis of any personal knowledge

that those expenditures had been made.

68a

Colloquy

She had in fact, and she admitted on cross-exam-

ination, merely read certain entries on that exhibit

with which she had no identification or connection

what—

(4801) convicted, Stop & Save Trading Stamp Cor-

poration, convicted. That’s a conspiracy.

The fraud, the fictitious fraudulent documenta-

tion.

And so he now has to tell Preis to induce him

to go down and to lie to the Grand Jury, “Difficult

crime to prove, can’t disprove no women, but only

McCrane and I can contradict you.

“I’m not going to talk, and I can tell you that

when McCrane goes down for his hearing he’s going

to take the Fifth.”

And this is Nelson Gross, now knowing in 1973

that Joseph McCrane would take the Fifth Amend-

ment before the United States Grand Jury when it

is his time to testify.

This is Nelson Gross who never spoke to Joseph

McCrane all during the year of 1969 during the

campaign.

This is Nelson Gross in 1973 during the Grand

Jury investigation assuring William Preis, “Do not

worry, Mr. Preis, go down, lie, they can’t catch

you, they can’t prove there were no women, and

the only witnesses against you, the only two wit-

nesses, McCrane and myself, are not going to talk.

McCrane will take the Fifth.”

(4802) And as it happens, and has been proved

to you through the Grand Jury stenographer, Jos-

eph McCrane, just as Mr. Gross used it to induce

69a

Colloquy

Mr. Preis to come down to the Grand Jury and lie,

J oseph McCrane, you may find as part of the con-

splracy or you may find to corroborate Mr. Preis’

testimony, Joseph McCrane took the Fifth Amend-

ment in the United States Grand Jury.

And that is what induced Mr. Preis to come

down to lie.

He felt safe in those lies because he was told by

a lawyer, Nelson Gross, there was no way we could

prove otherwise, and the other witnesses would take

the Fifth or wouldn’t testify.

And there is a meeting—I do want to say one

thing parenthetically, I am going to finish before

lunch, that makes you all happy—yesterday you

were here for a long, long day.

During the entire period of time from around

10:30, 10:45 in the morning until 5:25 last night

we had excruciating detail after detail after detail

about this entire case.

And when it came time for the month of April

we saw a calendar, and in Mr. Besser’s words, “I’m

going to hustle right through this, we’re going * * *

7Va

Affidavit of J. Robert Lunney, Esq.

UNITED STATES COURT OF APPEALS

For tHe Txurrp Cracuit

—>—

Unrrep Srates or AMERICA,

Appellee,

—against—

Netson G. Gross,

Appellant.

<>

Srate or New York

County or New York

J. Ropert Lunney, being duly sworn, says:

1. I am a member of Lumney & Crocco, New York,

N.Y., trial counsel to Richman, Berry, Ferren & Tyler,

Haddonfield, N.J., attorneys for Joseph M MeCrane, Jr.

and am familiar with the facts herein.

2. In the spring of 1973, New Jersey’s top law enforce-

ment officials, Herbert J. Stern, then U.S. Attorney for

New Jersey, and George F. Kugler, then State Attorney

General were engaged in parallel investigations into Gov-

ernor Cahill’s 1969 campaign.

71a

Affidavit of J. Robert Lumney, Esq.

3. By letter dated April 17, 1973, Stern advised Grover

C. Richman, Jr., Esq., that the grand jury requested Mc-

Crane’s appearance. Exhibit A. With tongue-in-cheek,

Stern facetiously added, “that you would not wish this

investigation to conclude without your client having...

the opportunity to make his position known to the Grand

Jury”. At the time, MeCrane was out of the country on

a business and pleasure trip. By telephone and return

letter the same date, April 17, 1973, Mr. Richman re-

peated his advice to Stern that if MeCrane did appear he

would exercise his constitutional right to refuse to tes-

tify. Exhibit B. Counsel also questioned the propriety

of utilizing the subpoena power and assured the U.S. At-

torney that McCrane would return to the jurisdiction in

the near future. Portions of this correspondence subse-

quently appeared in the press.

4. The U.S. Attorney then applied to Judge Frederick

B. Lacey for an order directing the service of a grand

jury subpoena on McCrane. Extensive publicity attended

the U.S. Attorney’s public statements that MeCrane was

“a key target of the probe” and his trip abroad was “an

attempt to dodge the lawful process of this grand jury”.

5. On April 27, 1973, McCrane appeared before the

grand jury. When McCrane did invoke his constitutional

privilege against self-incrimination, the U.S. Attorney

made a prearranged application to Judge Lacey for an

order compelling his testimony. Mr. Richman requested

that the matter be heard in camera on the ground that it

would be prejudicial to MeCrane’s rights to make it pub-

lie, citing the local Rules of the District Court.

72a

Affidavit of J. Robert Lunney, Esq.

6. Judge Lacey acknowledged the existence of the Rules,

passed while he was U.S. Attorney, but then stated he

would apply the Rules “when we come to that phase of

the proceeding”. He then recognized Stern who pro-

ceeded to review the matter in open court in the presence

of the waiting press, fortuitously assembled for the event.

In so doing, he referred to the government’s earlier ap-

plication to compel MeCrane’s presence, to the questions

asked him before the grand jury concerning his “activ-

ities with the firm of Writer [sic] Associates in procuring

false and fraudulent billings” and to his invocation of the

Fifth Amendment in response to said questions.

7. Mr. Richman objected on the record to the hearing

of the application in open court and took exception to the

references to MeCrane’s absence from the country. The

U.S. Attorney repeated these references and reiterated

the government’s attempts to obtain McCrane’s appear-

ance. Mr. Richman again objected to such discussion in

open court “for pure publicity purposes”.

8. With the assembled press taking their notes the

Court then lectured McCrane and his attorneys on the

privilege against self-incrimination. The Court empha-

sized the privilege “is confined to instances where the

witness has reasonable cause to apprehend danger from

a direct answer” but that “a witness’ claim of the privi-

lege is not final”.

9. In response to the Court’s invitation, Stern stated

that the investigation was to determine whether there was

a “scheme to defraud the United States in connection with

certain practices of securing money during the 1969 guber-

natorial compaign” and the grand jury “became convinced

73a

Affidavit of J. Robert Lumney, Esq.

that Mr. McCrane was an individual who would be in

possession of testimony which could shed considerable

light on that basi¢ investigation”.

10. The Court then had the reporter read the questions

asked McCrane before the grand jury. Mr. Richman con-

tinued to object to the proceedings being read in open

court as unduly prejudicial to McCrane. The Court im-

mediately overruled these objections and ordered the en-

tire proceedings read into the record. After answering

the usual “name, rank and serial number” questions, Mc-

Crane invoked the Fifth Amendment. Most of the twenty

five questions concerned an alleged tax scheme.*

11. After full public venting for two hours, the Court

finally recessed and an in camera hearing was finally held

in Judge Lacey’s chambers for ten minutes. Upon re-

turning, the Court referred to the U.S. Attorney’s state-

ments in open court, read extensive portions of the Preis

indictment in which it was alleged that McCrane master-

minded a tax fraud scheme and cited two crimes of which

he might be guilty and concluded that the witness “jus-

tifiably invokes the Fifth Amendment as to most of the

* Typical of Stern’s loaded questions was, “Did you direct anyone

to issue false and fictitious invoices from Writers Associates to

Hialeah Race Track, Atlantic City Racing, Cresci Aviation, Camden

Trust Company of New Jersey, Stop-and-Save Trading Stamp

Corporation, Trap Rock Construction Company, Passaic Paving

Company?” Stern thus obtained Fifth Amendment pleas that he

could then have read to the press with the imprimatur of Judge

Lacey. In addition, McCrane’s compulsory appearance to plead the

Fifth Amendment was contrived to obtain the alleged evidence of

a so-called conspiracy with Gross that McCrane would “take the

Fifth”.

T4a

Affidavit of J. Robert Lunney, Esq.

questions that were put to him”. The Court then had

McCrane return to the grand jury to answer just three

questions pertaining to his occupation and whether he

had been questioned by any state grand jury.

12. The manner in which the U.S. Attorney and the

Court conducted McCrane’s grand jury appearance re-

sulted in extreme prejudicial publicity. MeCrane’s valid

use of the Fifth Amendment, his proper refusal to sign

a waiver of immunity and the subject matter of the ques-

tions asked, traditionally protected by the secrecy of the

ground jury proceedings, together with the Court’s rul-

ing that McCrane might be guilty of conspiracy and tax

fraud, all became public knowledge and the subject of

intense newspaper coverage.

13. While the case against McCrane was moving

through the federal grand jury, the State was moving its

case against McCrane through its grand jury, all to the

accompaniment of extensive publicity. This race to in-

dietment wound up with the State as the winner, with

an indictment against McCrane filed on May 15, 1973.

14. On May 22, 1973, just two weeks before the primary

election, Nelson G. Gross was indicted by the federal grand

jury and McCrane named as an unindicted co-conspirator.

On May 24, 1973, the federal indictment against McCrane

was filed. Both were highly publicized.

15. Immediately following the MeCrane federal indict-

ment, a series of staggered federal indictments were re-

turned against various corporations named in his indict-

ment, alleging they filed false tax returns. On May 29,

1973, indictments were returned against Interser Interna-

75a

Affidavit of J. Robert Lunney, Esq.

tional, Inc. and Bellante, Clauss, Miller & Nolan, Inc.; on

May 31, 1973, against Trap Rock Industries, Ine. and

John F. Meade, Inc.; and on or about June 12, 1973 (a

week after the primary) against Gerald Electric Con-

struction Co., Inc. and Charles H. Knecht & Sons, Inc.*

16. The State, asserting its priority over the federal

indictment, pressed for an early trial against McCrane.

In February 1974 the State case was scheduled for trial

on April 15, and then adjourned peremptorily to April

29, 1974. Exhibit C. Defendants’ motions for severance

and change of venue were all denied. The State trial

actually commenced in May 1974 and the period from the

filing of the indictment, May 15, 1973, to the trial was

taken up with motions, discovery and preparation. It

was understood that the federal indictment against Me-

Crane was to be scheduled after the State case. While

the State went forward with the MeCrane prosecution the

— government proceeded with the prosecution of

ross.

17. Prior to the commencement of the Gross trial, Al-

bert G. Besser, Esq., Gross’ attorney, communicated with

me and requested that McCrane appear as a witness. I

advised Mr. Besser in view of the pending state and fed-

eral indictments against McCrane that if called, he would

avail himself of his constitutional privileges and refuse

to testify.

* On October 31, 1973, the eve of the general election, four more

indictments were filed against Atlantic City Racing Association,

Garden State Racing Association, Hialeah Race Course, Inc. and

Monmouth Park Jockey Club.

76a

Affidavit of J. Robert Lumney, Esq.

18. On or about March 13, 1974 after the Gross trial

commenced, Mr. Besser again requested McCrane’s ap-

pearance and I similarly advised Mr. Besser that we

were in the middle of preparing for the State case and in

view of the State and federal indictments pending against

McCrane, that if called he would avail himself of his con-

stitutional privileges and refuse to testify. In addition,

I requested that Mr. Besser so advise the government

and the Court of McCrane’s position and he agreed to

do so.

19. On May 30, 1974, the third day of McCrane’s state

trial, the Court directed a mistrial because of prejudicial

misconduct by the jury. The case has never been re-tried.

The federal government only then began to proceed to-

ward the McCrane trial. On September 19, 1974, 9 days

after the McCrane federal trial commenced, a mistrial was

ordered because of prejudicial publicity and an accumula-

tion of events which caused the court to seriously ques-

tion whether McCrane could receive a fair and impartial

trial. On October 25, 1974, after four days of another

futile attempt in empanelling an impartial jury and with

the argument for a writ of mcevdamus for a change of

venue before this Court, the i/istrict Court was com-

pelled to order the transfer of the McCrane federal case

to the Middle } strict of Pennsylvania. This extraor-

dinary relief wa: ordered after the obvious conclusion

was reached that re was so great a prejudice against

McCrane that he could not obtain a fair and impartial

trial in New Jersey.

23. In December 1974, at the close of the government’s

case, the Court in the Middle District of Pennsylvania di-

77a

Affidavit of J. Robert Lunney, Esq.

rected verdicts of acquittal on scven of the eleven counts

against McCrane, including the conspiracy count. There-

after, on December 11, 1974, a jury found McCrane guilty

on the four remaining counts. This Court, on December

18, 1975, affirmed McCrane’s conviction on two of these

counts and, because of the government’s intentional with-

holding of material evidence, reversed and remanded for

a new trial the remaining two counts. A petition for

certiorart to the Supreme Court was filed by McCrane

after rehearing was denied by this Court and is presently

pending. .

s/ J. Rospert Lunney

(Sworn to March 17, 1976)

78a

Letter dated April 17, 1973 from United States

Attorney to Grover C. Richman, Jr., Esq.

Untrep States DEPARTMENT OF JUSTICE

United States Attorney

For the District of New Jersey

Newark, New Jersey 07101

April 17, 1973

Grover C. Richman, Jr., Esquire

Richman, Berry Ferren & Tyler

41 Grove Street

Haddonfield, New Jersey 08033

Dear Mr. Richman:

As I am sure you are aware, the United States Grand

Jury for the District of New Jersey has been attempting

to obtain the appearance before it of your client, Joseph

McCrane, Jr., for exactly two weeks now.

The first attempt to serve Mr. McCrane occurred on

Tuesday, April 3, 1973, when a subpoena was left with

Mrs. McCrane who advised the agents that Mr. McCrane

was out of town on business and would return by that

very weekend.

As you know, Mr. McCrane not only failed to return

that weekend, but numerous contacts between this office

and yourself and Mrs. McCrane have utterly failed to

locate the exact whereabouts of Mr. McCrane other than

general statements by you that h» is the Caribbean on

his yacht.

I find it difficult to believe that a man who has so many

business and other ties here in New Jersey could so com-

79a

Letter dated April 17, 1973 from United States

Attorney to Grover C. Richman, Jr., Esq.

pletely absent himself from the State so as to lose all

contact and so as to make it impossible to determine his

exact whereabouts for two solid weeks.

I must also point out that this situation began and con-

tinued for an entire week before there was any notice in

the public press about the investigation and has continued

for an entire week thereafter.

As you have been repeatedly advised, it is necessary

to the proper resolution of the investigation now in pro-

gress that the United States Grand Jury be given an op-

portunity to hear the testimony of Mr. McCrane. I am

certain that you would not wish this investigation to con-

clude without your client having had at least the oppor-

tunity to make his position known to the Grand Jury.

In any event, since it appears that Mr. McCrane will

not voluntarily appear before the Grand Jury, we are

going to have to take steps to subpoena him. Accordingly,

if I do not hear from you by the close of business today

giving us a date certain this week when Mr. MeCrane will

appear before a Grand Jury, I will have no alternative

other than to use the provisions of Title 28 U.S.C. Sec-

tion 1783 which will enable us to subpoena Mr. McCrane,

as an American national, even though he is beyond the

territorial limits of the continental United States.

Sincerely,

Hersert J. STERN

Herbert J. Stern

United States Attorney

Hanp DELIVERED

Received by: (Illegible)

Date: 4/17/73

Time: 11 A.M.

80a

Letter dated April 17, 1973 from Grover C. Richman,

Esq. to United States Attorney

RicuMan, Berry, Ferren & TYLer

Law Offices

Haddonfield, New Jersey 08033

41 Grove Street

April 17, 1973

Telephone 795-4100

Area Code 009

Herbert J. Stern, United States Attorney

For the District of New Jersey

U. S. Dept. of Justice

Newark, New Jersey 07101

Dear Mr. Stern:

I have already acknowledged your hand delivered letter

of April 17, 1973.

I am sure that you know that, upon more than one occa-

sion I have informed your office that Joseph McCrane, if

called before your Federal Grand Jury would exercise his

constitutional right to refuse to testify. Your continued

insistence upon Mr. McCr

This text is long and has been trimmed here. Open the source document for the complete record.