Opposition — Street v. United States

FILED

No. 76-70 SEP 17 1976

ODAK, JR. CLERK

In the Supreme Court of the United Sires

OCTOBER TERM, 1976

EDWARD LLOYD STREET, PETITIONER

Vv.

UNITED STATES OF AMERICA

ON -PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE FIRST CIRCUIT

MEMORANDUM FOR THE UNITED STATES

IN OPPOSITION

RoBERT H. Bork,

Solicitor General,

Department of Justice,

Washington, D.C. 20530.

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In the Supreme Court of the United States

OCTOBER TERM, 1976

No. 76-70

EDWARD LLOYD STREET, PETITIONER

Vv.

UNITED STATES OF AMERICA

ON PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE FIRST © [RCUIT

MEMORANDUM FOR THE UNITED STATES

IN OPPOSITION

Petitioner contends that the district court abused

its discretion by admitting evidence of his poor character

and prior bad acts.

After a jury trial in the United States District Court

for the District of Massachusetts, petitioner was con-

victed on two counts of transporting a forged check in

interstate commerce, in violation of !8 U.S.C. 2314 and

2, and of conspiracy to commit that offense, in violation

of 18 U.S.C. 371.!' He was sentenced to 18 months’ im-

prisonment. The court of appeals affirmed in an unpub-

lished opinion (Pet. App. A).

'Co-defendants Carl Thomas Bannon, Jr., Jerome Fleet Cowden,

Richard Kilcullen, and Francis Ashby Reddall, Jr., were tried

separately and convicted on similar charges.

(1)

tl

The evidence at trial is set forth in detail in the opinion

of the court of appeals. It showed that petitioner and

co-defendant Kilcullen travelled from Massachusetts to

New York on December 3, 1973, to open a bank account

at the Bankers Trust Company in the name of the Island

and Overseas Bank, Ltd. (IOB) of Tortola, British Virgin

Islands. Petitioner represented to bank manager George

Littlejohn that he was president of IOB, that the com-

pany had some one million dollars in paid-in capital, and

that the company’s account would remain inactive. In fact,

1OB was a corporate “shell” which petitioner had pur-

chased from a Miami lawyer named Saul Cooper in

January 1973 (Pet. App. 10). Cooper testified about the

details of the sale, including the fact that petitioner had

defaulted on the promissory purchase notes in January and

April 1973 and that he (Cooper) had thereafter rescinded

the sale and had notified the Registrar of Companies in

Tortola that the sale had been annulled.”

Petitioner returned to Bankers Trust on December 10,

1973, and deposited two $97,000 checks purportedly drawn

on the Watertown, Massachusetts account of a Charles

Brennick, payable to and apparently endorsed by a Jacob

Weiner. Each of these checks had been forged, with

Brennick’s signature having been traced onto the checks

from a specimen of his genuine signature. (Pet. App. I1,

13).3 After these checks had been cleared by Bankers

*Cooper related that, in January and February 1973, petitioner

had complained that IOB did not have a license that was required of

all banks under a new Tortolan bank law. Cooper had agreed to

exchange IOB for a corporate banking shell in another Carribean

sovereignty, but petitioner never responded to this offer and instead

proceeded to default on the IOB purchase (Pet. 5).

‘Brennick was a Massachusetts businessman who, upon incurring

financial difficulties. had recently secured a $1.4 million loan. The

proceeds of this loan were credited to his account on December 10,

3

Trust, petitioner withdrew $100,000 in cashier’s checks and

deposited them in a newly opened savings account in

his own name at the Lincoln Trust Company in

Massachusetts. One week later he withdrew $55,000

of this deposit in cash.4 Petitioner also wrote two more

checks, totalling $25,000, on the Bankers Trust account,

payable to co-defendant Cowden (Pet. App. 12).

Petitioner contended at trial that he did not know the

checks had been falsely made or forged. He claimed that

shortly after opening the IOB bank account he had been

approached by co-defendant Bannon, a business associate,

and had been asked to process two checks and to distribute

the proceeds as directed, all for a fee of $10,000. Peti-

tioner alleged that after checking with co-defendant

Kilcullen, his lawyer, to determine if the proposal was

legal, he met with co-defendants Bannon and Cowden

on December 7, 1973, at which time Cowden gave him

the two Weiner checks, claiming that Weiner was his

client. Petitioner also offered explanations for the several

suspicious transactions that occurred after the checks

had been deposited (Pet. App. 14-15).

In view of the substantial circumstantial evidence of

petitioner’s knowing complicity in the fraudulent scheme,

the jury rejected his defense. This evidence included

1973, the same day that the Weiner checks were dated. Only a few

persons, including Brennick’s bookkeeper, co-defendant Reddall,

had known that the loan would be placed in Brennick’s account on

that date (Pet. App. 13-14).

4Lincoln Trust did not allow petitioner to make any withdrawals

until the cashier’s checks had cleared, in spite of petitioner’s false

protestations that he had to meet a payroll (Pet. App. 12 and n. 6).

4

the fact that petitioner had misrepresented the status

and assets of 1OB to Bankers Trust, had suggested routing

the checks in a circuitous fashion through several banks,

and had agreed to a fee of $10,000 for performing

functions that could easily have been carried out by co-

defendants Bannon or Cowden. In addition, while peti-

tioner claimed that he had been promised $10,000 for his

services, he had written some $19,000 in personal checks

upon the various Bankers Trust and Lincoln Trust accounts.

Bank manager Littlejohn testified that it was not custom-

ary for a bank executive to utilize for personal expenses

an official account such as that purpertedly maintained

by 1OB at Bankers Trust.°

Petitioner contends (Pet. 6-7) that the district court

abused its discretion by admitting Cooper’s testimony

concerning petitioner’s default in the purchase of IOB

and by admitting Littlejohn’s testimony concerning

New York banking law and the impropriety of a bank

officer’s use of bank funds to pay his personal debts.

Although evidence of a defendant’s other crimes or prior

bad acts is inadmissible merely to show his bad character,

the settled rule is that such evidence may be admitted

“for other purposes, such as proof of motive, opportunity,

intent, preparation, plan, knowledge, identity, or absence

of mistake or accident.” Rule 404(b), Fed. R. Evid. See,

e.g., Nye & Nissen v. United States, 336 U.S. 613, 618;

Moore v. United States, 150 U.S. 57, 61; McCormick,

Evidence §190 (2d ed. 1972). The question of admis-

sibility is addressed to the sound discretion of the trial

court, which must determine whether the probative

‘Littlejohn also testified that under New York law a bank was

required to obtain a license from banking officials before it could

do business in the State.

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5

value of the evidence is outweighed by its prejudicial

effect. See United States v. Alejandro, 527 F. 2d 423, 429

(C.A. 5), certiorari denied sub nom. Rocha v. United

Staies, No. 75-6432, June 7, 1976; United States v. Chapin,

515 F. 2d 1274, 1284 (C.A. D.C.), certiorari denied,

423 U.S. 1015.

Here, the prime issue in dispute at trial was whether

petitioner was aware that the Weiner checks had been

forged or whether, as petitioner claimed, he had not

known of the fraud and had been duped into cashing the

checks while pursuing what he thought was a legitimate

business deal. The challenged evidence was probative

of petitioner’s actual state of mind, since it showed that

he had used a suspicious “shell” corporation to cash and

distribute the checks, he had misrepresented himself

to Littlejohn in claiming to be president of IOB, and,

while purporting to function as a banker in his dealings

with Bankers Trust, he had violated basic tenets of bank-

ing practice. The evidence was thus clearly relevant to

establish that petitioner knew he was not pursuing a

legitimate business transaction, and the district court

properly admitted it at trial.

It is therefore respectfully submitted that the petition

for a writ of certiorari should be denied.

RoBeERT H. Bork,

Solicitor General.

SEPTEMBER 1976.

DOJ-1976-09