Opposition — Chambers v. United States

j —se a Vw we Ey

FILED

NOV 8 1978

Nos. 78-328 and 78-333 MIGHAEL RA@DAK, JR., CLERK

In the Supreme Court of the United States

OcTOBER TERM, 1978

Jot HENRY CHAMBERS, PETITIONER

V.

UNITED STATES OF AMERICA

CHARLES THOMAS GRIFFIN, PETITIONER

Vv.

UNITED STATES OF AMERICA

ON PETITIONS FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE EIGHTH CIRCUIT

BRIEF FOR THE UNITED STATES

IN OPPOSITION

WapeE H. McCree, Jr.

Solicitor General

Puitie B. HEYMANN

Assistant Attorney General

Joserpu S. Davies, Jr.

KAREN A. REBROVICH

Attorneys

Department of Justice

Washington, D.C. 20530

— —

INDEX

Page

IA SSRIS Men oe AON Ce oO Or |

IE Bla Suh Caos cencuntenintaliunalignrassvneseiddeeieesénsdenbes |

I a ssbb capaiudiaunne 2

TINE. Ghdntudietuenusdsasunnceneenisinaserecssevecssegussosescesnooteneens 2

PEED. sriucbvcndsnneskiavesniseecevvarnsnesoeseontatessenseversesnczeeesess 6

INI © ic ALUmALAUE Aa veua'cede sileataabuocenayivescanstiesbnesuasasiote 15

CITATIONS

Cases:

Beaudine v. United States, 368 F.2d 417 coco 14

Brady Vv. Maryland, 373 U.S. 83 ccccccccccccccccsseees 14

Brown v. United States, 411 U.S. 223 vce ]

Bruton v. United States, 391 U.S. 123 ccc 7

Hamling v. United States, 418 U.S. 87 ccc 10

Mack v. Maggio, 538 F. 2d 1129 vcccccccccccccssseeens x

Neison V. GD’ Neti, GZ U.S. G22 scscccscssvcccerecccccecees x

Schneble v. Florida, 405 U.S. 427 vcccccccccccesceeeees y)

United States v. Alvarez, 519 F. 2d 1052,

POTN, es Ge ete UW cevccncesessccccsvesccsecesseees 7

United States v. Baumgarten, 517 F. 2d

1020, cert. denied, 423 U.S. 878 cirsccccccccsceseees 12

United States v. Beechum, 555 F. 2d 487,

reh. en banc granted, No, 76-1444

EE Tr PIE ccs cco uvesuaudbevabinscndecepevnerensies 12

United States v. Benedetto, 571 F. 2d

Sciatic dcancrssseaibneaaraasdacesberevunssvasvesieddcssnaccsestnene 11

3 iti

ll

Page Page

Cases (continued):

Case Continued: United States v. Trudo, 449 F. 2d 649,

t. ied, Nee tees

United States v. Burke, 495 F. 2d 1226 wcccscssses. 7 Peay: pas . nite i. a '

t tat . Wi , , ;

United States v. Chenaur, 552 F. 2d 294 ......... I on denied, 423 pgs ane : intl ee. 7

United States v. Crockett, 534 F. 2d S589 we lI United States ex rel. Duff v. Zelker,

United States V. Dad, 536 F. 2d 675 vicccccccccccees 7 452 F. 2d 1009, cert. denied, \

ited Gis Dee st ee 9 Se ae Pe ein icesibniccces ccc vceceese x

Pe pits ak United States ex rel. Nelson v. Follette

United States v. Fairchild, 526 F. 2d 185, ,

cert. denied. 425 U.S. 94? ee ed RR 11 430 F, 2d 1055 POPU eR UES SESE CSSOOSOOSOOSOOOCCOSCCOCOCTOTOCCCe err eT 7

a United States ex rel. Stanbridge v. Zelker

; s Vv. Hykel. 461 F. Fad ‘tnldaditoecs : ;

United States v. Hykel. 461 F. 2d 721 4 514 F. 2d 45, cert. denied, 423 U.S. 872. ........ §

United States v. Kahn, 381 F. 2d 824, cert. ees

denied ae ee 10 Constitution, statutes and rules:

United States.v. Lawson, 483 F. 24 $35. United States Constitution, Sixth Amendment ... 7

cart. Gebied. €16-US. FIRE cctsccurtetesistteccsonean 9 Fr a rs... cosececeeeceeee ae

oy States v. Leopowitch, 318 U.S. . Fe Ny MI ettteeadicicconsccacsecesss.. 2, 3, 10, 4

NT cin” Cot Reed Peano | ic cosccocses. 3, 12, 13

United States v. Maestas, 554 F. 2d 834, Fed. R. Crim. P. 7

cert. denied, 43] U.S. 972 Re 1] ed. e rim, ’ (c) OPP eee eee eee eee eee cece eee ey 10

nied Sens \. Ie. 008 8 POG Ti Te i etssrrtictessesesesspesescesosvessecscsessseee 12

Cert. denied, 396 U.S. 100] v.cccccccssscsessesssseeees 1! FO ee eas eiiscssccceeesesasovesccoreesee 11, 12

United States v. Matlock, 415 U.S. 164 cccccccssece. 9 Os Bi I Gicssticiccdccsevecsocscceceseceeessceesse 1]

United States v. Quinn, 365 F. 2d 256 wn. 10 Lik ig 14

United States v. Shaw, 518 F. 2d 1182. v..cccee 8 SE )

United States v. Sims, 430 F. 2d 1089) cccccccscseees 8 Miscellaneous:

United States v. Smith, 451 F. 2d 595 ccc 8 2 Weinstein's Evidence (1977) para. 404 [09],

United States v. Spinks, 470 F. 2d 64, cert. TD senssanehasseeiiasiebabinetdanenietenshbcscecéncccescocccsscees 11

Gomes, GOD U.S; BOG ccisscassecesssascslcsnstanae x

In the Supreme Court of the United States

OCTOBER TERM, 1978

No. 78-328

Joe HENRY CHAMBERS, PETITIONER

Vv.

UNITED STATES OF AMERICA

No. 78-333

CHARLES THOMAS GRIFFIN, PETITIONER

Vv.

UNITED STATES OF AMERICA

ON PETITIONS FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE EIGHTH CIRCUIT

BRIEF FOR THE UNITED STATES

IN OPPOSITION

OPINION BELOW

The opinion of the court of appeals (Pet. App. 13-31)!

is reported at 579 F. 2d 1104.

JURISDICTION

The judgment of the court of appeals was entered on

June 29, 1978. Petitions for rehearing were denied on July

‘All appendix references are to the appendix filed by petitioner

Chambers (No. 78-328).

(1)

28, 1978 (Pet. App. 32-33). The petitions for a writ of

certiorari were filed on August 25, 1978 (No. 78-328) and

August 28, 1978 (No. 78-333). The jurisdiction of this

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

QUESTIONS PRESENTED

|. Whether the government’s use at trial of co-

conspirators’ false exculpatory statements denied peti-

tioners either the right of confrontation or a fair trial.

2. Whether Counts II and III of the indictment

sufficiently informed petitioners of the charges against

them.

3. Whether evidence of prior similar acts was properly

admitted.

4. Whether evidence of petitioners’ attempt to cover up

their fraud was properly admitted.

5. Whether there was sufficient evidence in the record

to support petitioner Griffin’s conviction on Count V.

6. Whether the trial court properly instructed the jury

on the elements of a fraudulent receipt as set forth in 18

U.S.C. 1006.

7. Whether petitioners were improperly denied access to

allegedly exculpatory material.

STATEMENT

Following a jury trial in the United States District

Court for the Eastern District of Arkansas, both peti-

tioners were convicted, together with co-defendant Bill

Hansell, of conspiring to defraud and actually defrauding

a federally-chartered loan association, in violation of 18

U.S.C. 371 and 1006. Petitioners Griffin and Hansell were

also convicted of preparing a false loan application for the

purpose of influencing the actions of a loan association, in

violation of 18 U.S.C. 1014 and 2.2 Petitioner Griffin

received concurrent terms of 15 months’ imprisonment on

each of the three counts on which he was convicted and

was fined a total of $20,000. Petitioner Chambers also

received concurrent terms of 15 months’ imprisonment on

each of the two counts on which he was convicted and

was fined a total of $7,500. The court of appeals affirmed

(Pet. App. 13-31).

The evidence showed that Griffin, Chambers, and

Hansell, who were, respectively, president, vice-president,

and a branch manager of the Lonoke Production Credit

Association (LPCA),’ conspired to defraud the associa-

tion by making unlawful profits in connection with an

LPCA loan transaction. Specifically, petitioners con-

ditioned an LPCA loan on the borrower's purchase of

petitioners’ land at a_ substantially inflated price.‘

Concomitantly, petitioners fraudulently arranged a

second LPCA loan to cover the purchase price of the

land.

2Count | charged all three defendants with conspiracy to

fraudulently receive funds of a federally-insured loan association, in °

violation of 18 U.S.C. 371 and 1006. Count II charged only petitioner

Griffin, Count III] charged only petitioner Chambers, and Count IV

charged only co-defendant Hansell with defrauding a federally-

insured loan association, in violation of 18 U.S.C. 1006. Count V

charged all three defen’ nts with preparing a false loan application,

in violation of 18 U.S.C. 1014 and 2. The jury found defendants

guilty of all counts, except that it acquitted Chambers on Count V.

Hansell did not join in petitioners’ appeal to the Eighth Circuit.

The LPCA is a farmer-owned and controlled loan association

organized under the Farm Credit System and designed to provide

short and intermediate term credit to farmers in the association's

federally chartered “territorv’"—four centrally located Arkansas

counties (Pet. App. 16; | Tr. 60, 63-64). The LPCA is supervised by

the Federal Intermediate Credit Bank of St. Louis, Missouri, whose

approval is required for lending money for use outside the asso-

ciation’s territory or to an individual borrower beyond the asso-

ciation’s “excess loan limit” (I Tr. 59-60, 109, 119).

‘The land was purchased by petitioners but held in the name of

O.M. Young, Trustee (Pet. App. 17).

Petitioners’ conspiracy began in early 1974 when

Hansell informed Harold Huntsman, a large farm

operator, that his previous application for loans from the

LPCA had been denied because the Federal Intermediate

Credit Bank in St. Louis had objected to Huntsman’s

insufficient land holding in LPCA “territory” (Il Tr. 173-

178). Pursuant to Hansell’s instructions, Huntsman began

purchasing additional property within LPCA territory in

order to obtain LPCA financing, but he again was unable

to secure a crop loan for the 1974 season (II Tr. 174-179,

184-188). Subsequently, in July 1974, Hansell approached

Huntsman and guaranteed him that the necessary funding

would be forthcoming from LPCA if Huntsman would

purchase a 2,880-acre cattle farm currently for sale, albeit

outside the LPCA territory (II Tr. 185-198; III Tr. 140-

142; IV Tr. 61-62, 63-64). Hansell, who told Huntsman

that “Mr. Griffin was waiting for [his] decision” (II Tr.

193), additionally promised that Huntsman would lose no

money on this deal and that an LPCA “crop loan” would

be arranged to cover the purchase price (II Tr. 193-196,

202; IV Tr. 64-65). Unbeknownst to Huntsman, this

2,880-acre farm had recently been purchased by

petitioners from Irving Brauer through a trustee for

$470,000 (Pet. App. 17-18; II Tr. 123-128, 198; IV Tr. 68).

Ultimately, Huntsman and his family agreed to buy the

farm for $634,000, at which time Hansell prepared an

LPCA crop loan application for $513,800, which pur-

ported to cover crops to be grown on the 2,880-acre cattle

farm (Pet. App. 17-18; Il Tr. 193-201). Subsequently, this

loan application was approved by the Association Loan

Committee (including petitioner Griffin) (1 Tr. 104-105),

and on July 24, 1974, after Huntsman had signed a

contract purchasing the farm from O.M. Young, Trustee,

‘A crop loan is used to finance the planting and harvesting of a

crop and iy repaid out of the proceeds of the sale of the crop (I Tr.

114-115; Il Tr. 47-48, 93).

5

and assuming various debts in connection therewith (II

Tr. 197-201), Huntsman received two checks constituting

the proceeds of the crop loan. One check was issued in the

amount of $121,433.33 made payable to Huntsman and

the Bank of McCrory in order to obtain a release of an

existing crop lien (1 Tr. 110-112; Il Tr. 64-65; Pet. App.

18). Hansell refused to give Huntsman the second check,

which was issued in the amount of $386,600,° until

Huntsman arranged to give Hansell a cashier's check for

$292,319.18, made out to O.M. Young, Trustee, as down

payment on the 2,880-acre farm (Pet. App. 18; II Tr. 196,

202-207; IV Tr. 166-169). Two days later, the trustee paid

over $71,000 each to Griffin and Hansell, and $20,000 to

Chambers (Pet. App. 18; IV Tr. 189-190).’

Petitioners’ scheme began unraveling in December

1974 when Brauer, the previous owner of the farm,

discovered that Huntsman was the current

owner of the farm and contacted Huntsman over a past

due payment (II Tr. 133-135; IIL Tr. 32). Huntsman

had neither the money nor the inclination to meet

this installment of the sales contract and told

Brauer to contact Hansell at the LPCA for payment

(11 Tr. 133; Ul Tr. 32-35). Thereafter, Huntsman

learned of the large difference between Brauer’s

selling price and his own purchase price (II Tr.

133-135; Ill Tr. 35-36), and apparently by March

1975 Huntsman also knew that petitioners had been

the equitable owners of the 2,880-acre farm (Pet.

App. 19).

‘The difference between the total of the two checks ($508,033.33)

and the loan amount ($513,800) was attributable to fees and

insurance premiums (I Tr. 112-113).

*Huntsman's purchase price of $634,000 was $164,000 more than

the price paid by petitioners to the prior owner Irving Brauer. A total

of $162,000 was divided among the co-defendants as described above,

and $2,000 was retained by Young, who died in 1976 (IV Tr. 185-186,

189-190).

At this time, Hansell approached Huntsman in order to

cover up the fraud. Hansell admitted that the LPCA

officers had unlawfully made a profit on the loan

transaction and told Huntsman that he (Hansell) would

do anything if Huntsman would not go to the FBI (Pet.

App. 19; III Tr. 48-51; IV Tr. 139-146). Later that day,

Jimmie Boggess, a friend of petitioners, called Huntsman

and eventually arranged to buy the farm from Huntsman

for $662,000 (Pet. App. 19; III Tr. 52-60; IV Tr. 67-70).

This sale was consummated in Young's office with

petitioner Chambers, Young, Boggess, and Huntsman

present (Pet. App. 20; III Tr. 63-65). Petitioners and

Hansell supplied the purchase money and subsequently

induced Boggess to give a false statement to the

government investigators concerning the circumstances [

the purchase (Pet. App. 20; VI Tr. 46-61).

ARGUMENT

|. Petitioners raise several questions (Chambers Pet.

11-19; Griffin Pet. 14-17) concerning the use at trial of the

co-defendants’ written and signed statements given to

government investigators regarding the Huntsman loan-

sale transactions. These parallel statements, which were

redacted to delete any reference to a co-defendant before

being admitted into evidence, essentially told the same

false exculpatory story (Pet. App. 21; V Tr. 131-188;

Gov't Exhs. 63. 64, 65, 66. 67, 68). Thus, each defendant®

claimed that Boggess had found a farm for sale and had

invited him to participate in the speculative venture,

which invitation was accepted. Thereafter, according to

the defendants’ story, each defendant received his

proportionate share of the profits when Boggess and

trustee Young arranged for the sale to Huntsman. Each

‘Boggess gave the same story to investigators, and his statement in

unredacted form was admitted into evidence during Boggess’ direct

testimony on behalf of the government (V1 Tr. 37-58, Gov't Exh. 69).

defendant disclaimed more than a cursory knowledge of

the specifics of the Huntsman loan and denied that the

loan had any connection to the sale of property. At trial,

Boggess and Hansell took the witness stand and admitted

that their statements were false, and Boggess testified that

the three defendants had supplied him with the false

_ exculpatory story subsequently given to the government

investigators (VI Tr. 38-62; VIII Tr. 21, 144-145, 156-157).

a. Petitioners contend (Chambers Pet. | 1-14; Griffin

Pet. 14-16) that this Court's opinion in Bruton v. United

States, 391 U.S. 123 (1968), mandates a new trial here.

However, Bruton involved the admission of a defendant's

confession that “powerfully” and “devastating{ly]” in-

criminated his co-defendant, who was also on trial. /d. at

135-136. Since the defendant whose confession was

admitted did not testify, this Court held that the co-

defendant's rights under the Confrontation Clause of the

Sixth Amendment had been violated. /d. at 128. In

contrast, the statements admitted here were exculpatory

in nature, see United States v. Wingate, 520 F. 2d 309,

313-314 (2d Cir. 1975), cert. denied, 423 U.S. 1074 (1976):

United States v. Burke, 495 F. 2d 1226, 1232-1233 (Sth

Cir. 1974); United States ex rel. Nelson v. Follette, 430 F.

2d 1055 (2d Cir. 1970), and, moreover, were redacted to

delete any reference to a co-defendant, thereby avoiding

the Bruton problem. See Bruton v. United States, supra,

391 U.S. at 133-134 n.10; accord, e.g., United States v.

Dady, 536 F. 2d 675 (6th Cir. 1976); United States v.

Alvarez, 519 F. 2d 1052 (3d Cir.), cert. denied, 423 U.S.

914 (1975); United States v. Trudo, 449 F. 2d 649 (2d

Cir.), cert. denied, 405 U.S. 926 (1972).

Furthermore, petitioners cannot demonstrate any

cognizable prejudice from the admission of their

statements. Boggess and Hansell testified at trial, which

rendered their complete statements fully admissible.

Nelson v. O'Neil, 402 U.S. 622 (1971); United States v.

Smith, 451 F. 2d 595 (9th Cir. 1971); United States v.

Sims, 430 F. 2d 1089 (6th Cir. 1970). Those statements

tracked and interlocked with Chambers’ and Griffin's

false accounts, which were at least admissible against their

respective makers. Thus, the only prejudice possibly

suffered by Chambers stems from the spillover effect of

Griffin's exculpatory statement, the substance of which

had already been properly admitted against Chambers in

the form of three other statements including his own.

Similarly, of course, Griffin's alleged prejudice emanates

from the insignificant cumulative effect of Chambers’

exculpatory statement. In such circumstances, petitioners’

Sixth Amendment claim is without merit.? Mack v.

Maggio, 538 F. 2d 1129 (Sth Cir. 1976); United States v.

Shaw, 518 F. 2d 1182 (4th Cir. 1975); United States ex rel.

Stanbridge v. Zelker, 514 F. 2d 45 (2d Cir.), cert. denied,

423 U.S. 872 (1975); United States v. Spinks, 470 F. 2d

64 (7th Cir.), cert. denied, 409 U.S. 1011 (1972); United

States ex rel. Duff v. Zelker, 452 F. 2d 1009 (2d Cir.

1971), cert. denied, 406 U.S. 932 (1972).

‘Nor is there any merit to petitioners’ contention (Chambers Pet.

17-18; Griffin Pet. 16) that the district court erred in failing to charge

the jurors concerning the limited admissibility of the redacted

statements. The co-defendants’ statements were read to the jury in

rapid succession (V Tr. 159-187). After the first statement was

admitted, the judge correctly instructed the jury that such a statement

was “received only as to the defendant whose statement it is” (V Tr.

164). Petitioners did not request that this warning, which was

applicable to all three statements. be repeated when their statements

were introduced into evidence moments later. Moreover. the court

had previously given a similar instruction and = subsequently

reiterated this admonition in its charge to the jury (ID Tr. IS81-184:

XI Tr. 20).

9

b. Petitioner Chambers contends (Pet. 12-13) that the

prosecutor committed prejudicial error in his opening

statement by summarizing portions of the co-defendants’

unredacted statements (Opening Tr. 22-30). However, as

the court of appeals noted (Pet. App. 20-21), petitioners

never objected to the prosecutor's opening argument or

moved for a mistrial, and they are thus deemed to have

waived their objection. United States v. DeRosa, 548 F.

2d 464, 471-472 (3d Cir. 1977); United States v. Lawson,

483 F. 2d 535, 538 (8th Cir. 1973), cert. denied, 414 U.S.

1133 (1974). In any event, this alleged error was harmless

beyond a reasonable doubt. As already stated, the

unredacted statements of Boggess and Hansell were

admissible, and Chambers’ own statement was admissible

against himself. Griffin's statement was not admissible

against Chambers, but Griffin's own counsel “in opening

statement admitted nearly all of the facts referred to in

Griffin's statement” (Pet. App. 21; see Opening Tr. 40-44).

Given the cumulative, interlocking and exculpatory

nature of the statements, the strength of the prosecution's

case, and the trial court's curative charge,'® the

prosecutor’s remarks do not constitute plain error. See

Brown v. United States, 411 U.S. 223-230-232 (1973);

Schneble v. Florida, 405 U.S. 427 (1972).

c. Petitioners next argue (Chambers Pet. 14-17; Griffin

Pet. 16-17) that the defendants’ written statements were

not made in futherance of the conspiracy and are

therefore inadmissible hearsay. However, Fed. R. Evid.

801(d 2A) provides that “[a] statement is not hearsay

*** offered against a party and is *** his own

statement.” Since the defendants’ own statements were

admitted solely against the respective declarant (V Tr.

164; XI Tr. 20), petitioners’ claim is unavailing. See, e.g.,

United States v. Matlock, 415 U.S. 164, 172 & n.8 (1974).

The court instructed the jurors to consider only the evidence

adduced at trial and not the lawyers’ statements (XI Tr. 3-4, 6).

10

2. Petitioners further contend (Chambers Pet. 19-24,

Griffin Pet. 7-9) that neither Count II (Griffin) nor

Count II (Chambers) sufficiently charged a violation of

18 U.S.C. 1006. However, those counts (Pet. App. 7-8)

fairly informed petitioners of the charges against them by

concisely alleging the elements of the crime and the

pertinent underlying facts including the time, place,

manner and perpetrators of the fraudulent transaction.

See Fed. R. Crim. P. 7(c). Since the indictments enabled

petitioners to prepare a defense to the specified charges

while adequately protecting petitioners from future

prosecutions for the same offense, the court of appeals

correctly rejected petitioners’ claims on this point (Pet.

App. 21-22). Hamiing v. United States, 418 U.S, 87, 117

(1974),

Although, as petitioner Chambers points out (Pet. 23-

24), the Seventh Circuit once dismissed a four-count

indictment which included a Section 1006 count similar to

those challenged here (United States v. Quinn, 365 F. 2d

256 (7th Cir, 1966)), the rationale of that case, which was

decided before Hamling v. United States, supra, is not

readily discernible.'' More importantly, the Seventh

Circuit subsequently construed Quinn to require only that

a Section 1006 indictment not “chargfe] and convic[t] an

individual for no more than maladministration, mistake

or ineptitude.” United States v. Kahn, 381 F. 2d 824, 832

(7th Cir.), cert. denied, 389 U.S. 1015 (1967). Since

Counts Il and III correctly averred the underlying facts

and the elements of the charge, including that petitioners

had acted with an “intent to defraud” (Pet App. 7-8), the

Quinn rationale is inapplicable here. United States v.

The court in Quinn noted, inter alia, that one of the Section 1006

counts failed to aver that the defendant had received money in

‘onnection with the bank transaction and also that the entire

indictment was invalid because of misjoinder problems, 365 F, 2d at

262-264,

Chenaur, 552 F. 2d 294, 300-301 (9th Cir, 1977) (expressly

rejecting Quinn).

3. Petitioners also argue (Chambers Pet. 24-32; Griffin

Pet. 12-13) that the trial judge abused his discretion in

allowing the prosecution to introduce into evidence other

similar criminal acts by the petitioners. After three

pretrial hearings concerning the admissibility of such

evidence, the district court limited the prosecution to

those prior acts that involved a fraudulent loan transac-

tion closely analogous to that charged in the indictment

(Pet App. 25). Thus, the testimony challenged by

petitioners clearly and convincingly demonstrated that on

at least two other occasions petitioners had defrauded

L.PCA by deceptively financing the profitable purchase or

sale of land in which they had an interest (Pet App. 25; V1

Tr. 177-214, 221-227). Such similar acts were properly

admitted by the district court to prove petitioners’

knowledge and intent—the issues most strenuously

contested by petitioners at trial. Fed. R. Evid. 404(b); e.g.,

United States v. Crockett, 534 F. 2d 589, 604-605 (Sth Cir,

1976); United States v. Maine, 413 F. 2d 214 (7th Cir,

1969). cert. denied, 396 U.S. 1001 (1970); 2 Weinstein's

Evidence. para, 404 [09], at 404-50 to 404-53 (1977),

Moreover, given the strong probative worth of this

evidence, the district court did not abuse its broad

discretion under Fed. R. Evid. 403 in admitting the

similar acts testimony. See, e.g., United States v. Maestas,

554 F. 2d 834, 836 (8th Cir.), cert. denied, 431 U.S, 972

(1977); United States v. Fairchild, 526 F. 2d 185, 189 (7th

Cir, 1975) (Stevens, J.), cert. denied, 425 U.S, 942

(1976)!,

Petitioner Chambers erroneously suggests (Pet, 24-28) that a

conflict exists among the courts of appeals because some of the

circuits have concluded that their prior precedent is consistent with

Rule 404(b) while others may have been more stringent about other

crimes evidence before Rule 404(b) codified the inclusionary

approach to the issue, See United States v. Benedetto, 571 F, 2d 1246,

12

4. Petitioners also challenge (Chambers Pet. 19, 3);

Griffin Pet. 11) the admission of testimony concerning

their repurchase of the Huntsman farm. However,

evidence of the “buy back", which was prompted by

petitioners’ desire to keep Huntsman from going to the

authorities, was certainly relevant to show petitioners’

knowledge and intent. See Fed. R. Evid. 401. Indeed, in

connection with the repurchase, defendant Hansell

confessed his wrongdoings to Huntsman (Pet App. 19; II]

Tr. 48-51; IV Tr. 139-146), while Boggess’ testimony

convincingly evidenced petitioners’ knowing participation

in the fraudulent transaction (Pet. App. 19-20; VI Tr. 30-

67). Finally, in an excess of caution, the trial judge

repeatedly admonished the jurors that they could only

consider this evidence with regard to the substantive

counts (III Tr. 20-32; 52-53; V Tr. 27; VI Tr. 44, 66).

Accordingly, the court of appeals correctly concluded

(Pet. App. 23-24) that the district court had not abused its

broad discretion in admitting the repurchase evidence.

Fed. R. Evid. 401, 403; see, ¢.g., United States v.

Baumgarten, 517 F. 2d 1020, 1027-1030 (8th Cir.), cert,

denied, 423 U.S. 878 (1975).

5. Next, petitioners contend (Chambers Pet. 32-34;

Griffin Pet.9-11) that there was insufficient evidence to

support a conviction on Count V of the indictment

regarding the filing of a false loan application for the

purpose of influencing LPCA in violation of 18 U.S.C.

1014 and 2. At the outset, we note that petitioner

Chambers was acquitted of this charge and has no cause

for complaint. Moreover, the evidence adduced at trial

amply justified the district court's decision to submit

1248 (2d Cir, 1978). Moreover, none of the cases cited by petitioner,

including United States \. Beechwmn, 555 Fb. 2d 487 (Sth Cir, 1977),

reh. en bane granted. No, 76-1444 (Nov, 3, 1977), is in conthet with

the result here, which involved convincing prool of similar traudulent

schemes.

13

Count V to the jury regarding all defendants. The

Huntsman loan application, which was prepared by

Hansell, stated that the borrower sought a “crop loan.”

(Pet. App. 17-18; Il Tr. 193-201; Gov't. Exh. 7). In

actuality, of course, the proceeds of the crop loan !} were

used to pay for the 2,880-acre cattle farm which

Huntsman had been forced to purchase by petitioners as a

condition precedent to any further LPCA financial

assistance, Indeed, Hansell would not disburse the

proceeds of the loan until Huntsman had arranged for the

transfer of a $292,000 cashier's check to him for the

purchase of the property (Il Tr. 202-207). The evidence

further showed that petitioners had denominated the

transaction as a crop loan to avoid various purchase loan

(mortgage) approval requirements of the bank, such as

appraisals and supervisory bank approval of an out-of-

territory purchase loan (1 Tr. IIS, 119-120; Il Tr. 22-23).

Finally, Griffin, who knew that the loan was to be used to

cover the purchase of the property (II Tr. 193), sat on the

loan committee that approved Huntsman’s crop loan

application (Pet. App. 17, 23). In sum, when viewed most

favorably to the government, the evidence strongly

supported the jury's finding that Griffin had violated

Section 1014,

6. Petitioner Chambers raises several objections (Pet.

34-39) to the district court's jury instructions concerning

the phrase “intent to defraud” found in Section 1006 (XI

Tr. 23-24). Specifically, petitioner claims that the charge

would have permitted the jury to convict him for an

'SPetitioners argue that the bank does not force the recipient of a

crop loan to use those proceeds for crop production and that

therefore the loan application was not false. However, here

petitioners forced Huntsman to use his crop loan to purchase the

farm and there was substantial evidence that a crop loan is governed

by different regulations from a “real estate” loan and cannot be used

to purchase real estate--facts which petitioners obviously knew from

their experience as bank officers (Pet. App. 17 n.2; 1 Tr. 114-116,

119; IL Tr, 47-48, 93-94; IV Tr, 9-11, 95).

14

unknowing violation of bank regulations. But the trial

judge correctly informed the jurors that in evaluating the

issue of intent they could consider petitioners’ “failure to

comply with the applicable regulations and bylaws of

[LPCA] which were known to said defendant * * *” (XI

Tr. 24; emphasis supplied). Equally unavailing is

petitioners’ implication (Pet. 37) that in order to convict,

the jurors had to find that the petitioners’ fraud ultimately

caused a financial loss. United States v. Hykel, 461 F. 2d

721, 725 (3d Cir. 1972); see United States v. Leopowitch,

318 U.S. 702, 704 (1943). Finally, the district court's use

of the word “benefit” in this portion of the charge is

certainly unobjectionable, since Section 1006 uses

“benefits” in broadly defining the coverage of that

provision. As the court of appeals concluded, the trial

judge carefully and correctly instructed the jurors

regarding fraud as defined in Section 1006. See United

States Vv. Hykel, supra, 461 F. 2d at 724; Beaudine v.

United States, 368 F. 2d 417, 420 (Sth Cir. 1966).

7. Lastly, petitioners’ contention (Chambers Pet. 39-40;

Griffin Pet. 13-14) concerning the nondisclosure of certain

LPCA minutes is without merit. The allegedly ex-

culpatory material consisted of a supervisory bank

officer’s opinion based on personal surmise (see VI Tr.

118-119) that no criminal violations had occurred (VI Tr.

116-117). Such an opinion was inadmissible at trial. See

Fed. R. Evid. 701. Moreover, the record unequivocally

reflects that the government had neither possession nor

knowledge of this particular portion of the minutes, which

were equally accessible to defense counsel (VI Tr. 25-28,

113-141). Furthermore, defense counsel (as well as the

prosecution) had the benefit of this material nine days

before the tiial concluded. In such circumstances,

petitioners’ claim based on Brady v. Maryland, 373 U.S.

83 (1963), is frivolous.

15

CONCLUSION

The petitions for a writ of certiorari should be denied.

Respectfully submitted.

NOVEMBER 1978

DOJ-1978-11

WADE hi. McCres, Jr.

Solicitor General

Puitiep B. HEYMANN

Assistant Attorney General

JosePH S. DAvies, JR.

KAREN A. REBROVICH

Attorneys