Petition — Ellis v. United States

79-2011

No.

SE a co ee Oey JR., CLERR

IN THE

Supreme Court of the United States

OCTOBER TERM, 1979

WILLIAM L. ELLIs,

Petitioner,

versus

THE UNITED STATES OF AMERICA,

Respondent.

PETITION FOR WRIT OF CERTIORARI

To the United States Court of Appeals

for the Sixth Circuit

CeciL D. BRANSTETTER

CARROL D. KILGORE

200 Church Street

Nashville, Tennessee 37201

Attorneys for Petitioner

St. Louis Law Printing Co., Inc., 411 No. Tenth Street 63101 314-231-4477

“lil

Opinions Below

Jurisdiction ....

TABLE OF CONTENTS

Questions Presented for Review..............0.e0005

Statutes .......

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Reasons for Granting the Writ ..................004.

Appendix:

Order of District Court

Order of Sixth Circuit

Order of 6th Circuit denying rehearing...........

Statutes:

18 U.S.C.

29 U.S.C.

> Ww NY WN

AUTHORITIES CITED

Cases

Abbott v. U.S., 239 F.2d 310 (5 Cir., 1956) ........... 10

Anderson v. Mt. Clements Pottery Co., 328 U.S. 680 .. 10

Braverman ¥. U.S. SEF Ui. GD occ ccccceccccccccees 5

Brown v. Phetcine®, 237 U5, SBS. oc ccccccccsccccccess 11

Fisher v. U.S., 327 F.2d 775 (8 Cir., 1963) cert. den. 377

ERR Be ee 10

Horning v. District of Columbia, 254 U.S. 135 ........ 9

Jackson v. Virginia, U.S. ___ 61 L.Ed. 2d 560 ... 2,9,10

Kotteakos Vv. U3 g SEB UB. FIO ce sccccccccccccccses 5

Maryland Casualty Co. v. Jones, 279 U.S. 792 ........ 11

Moore v. U.S., 360 F.2d 353 (4 Cir., 1965)............ 10

Proctor v. Warden, Maryland Penitentiary, 435 U.S.

ae 11

U.S. v. DR, Te et reece ccccccncee 1]

U.S. v. Brown, 461 F.2d 912 (6 Cir., 1972)............ 1]

U.S. v. Demetrie, 461 F.2d 971 (6 Cir., 1972).......... 10

U.S. v. Donahue, 539 F.2d 1131 (8 Cir., 1976)......... 10

US. v. Eley, 314 F.2d 127 (7 Cir., 1963) ..........006. 10

U.S. v. Nance, 502 F.2d 615 (8 Cir., 1974) ............ 10

U.S. v. Nunan, 256 F.2d 576 (2 Cir., 1956)............ 10

Statutes

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SR ss bk eae visbbtvenees Comnadtws sue 3,4

, is Coe | rere verre rer: reer rer Te 2

POU SH. CE cee le rescrscbevvaweersguvese 3,4

oc ki xvaseevaeedneubeee shcnheen 3,7

CNN ios cos con tapeewevetadentenss 2,3,4,7,10

No.

IN THE

Supreme Court of the United States

OCTOBER TERM, 1979

WILLIAM L. ELLIS,

Petitioner,

versus

THE UNITED STATES OF AMERICA,

Respondent.

PETITION FOR WRIT OF CERTIORARI

To the United States Court of Appeals

for the Sixth Circuit

Petitioner, William L. Ellis, prays that a Writ of Certiorari

issue to review the judgment of the United States Court of Ap-

peals for the Sixth Circuit affirming his conviction in the United

States District Court for the Middle District of Tennessee,

Nashville Division.

f OPINIONS BELOW

The Appendix contains the opinion of the United States

District Court for the Middle District of Tennessee (infra, pp.

A-1 — A-25) and the Orders of the United States Court of Ap-

peals for the Sixth Circuit affirming the judgment of conviction

com sia

(infra, App. B pp. A-26 — A-29) and denying the Petition for

Rehearing (infra, App. C p. A-30).

Such opinions and order have not yet been published in any

official or unofficial reports.

JURISDICTION

i. The judgment of the United States Court of Appeals for

the Sixth Circuit affirming Petitioner’s conviction was entered

March 24, 1980.

ii. The Order denying the Petition for Rehearing was entered

May 23, 1980. No time extension for filing the Petition for Cer-

tiorari has been sought or granted.

iii. This Court has jurisdiction to review the judgment by Writ

of Certiorari under 28 U.S.C. § 1254(1).

QUESTIONS PRESENTED FOR REVIEW

1. Whether a defendant has been accorded proper appellate

review under the standards of Jackson v. Virginia, — U.S. —,

61 L.Ed.2d 560, by an order endeavoring to state reasons for af-

firmance of his eleven-count convictions when such order--

(a) Inaccurately stated the facts relating to five con-

spiracy/mail fraud counts by failing to note important

government evidence contrary to the Court’s factual theory;

(b) Summarized, with important inaccuracies, the

government’s evidence as to payments made to petitioner,

a local union president, by a debtor of the union without

considering petitioner’s statutory construction contention

that such could not constitute a conversion of an asset

which had become property of the union, contrary to 29

U.S.C. § S501(c);

at an

(c) Summarized as “‘indirect’’ and ‘‘sufficient’’ evi-

dence as to abuse of the union’s telephone and telephone

credit cards without noting that the government proved

petitioner’s calls unrelated to union business totalling only

$2.07, $7.66, and $1.80, in three successive years, that

these personal calls were made to a city other than the cities

identified by the indictment as the terminal points of per-

sonal phone calls at union expense, in disregard of the fact

that the government’s proof showed that unauthorized

calls made by third parties were made without petitioner’s

knowledge, and in disregard of the fact that the learned

District Judge had sustained judgments of guilt upon the

theory that jurors can base their verdicts upon speculation

instead of evidence. a

2. Upon an appeal of right from a criminal conviction, is a

Court of Appeals justified in finding as without merit and

therefore frivolous serious defensive arguments--

(a) That the de minimus doctrine applies to proof of

conversion and of failure by union president to report

receipt of benefits totalling approximately $10 over a three-

year period;

(b) In relation to a union president’s receipt of pay-

ments from a third person, that the civil liability provision

of 29 U.S.C. §501(b) and the criminal liability provisions

of 29 U.S.C. § 501(c) must be construed in pari materia in

view of the differences therein;

points of law upon which neither that Court nor this Court has

ever rendered an opinion.

STATUTES

The Statutes which the case involves, reprinted in the Appen-

dix, are 18 U.S.C. §§ 371 and 1341, and 29 U.S.C. §§ 431, 439

and 501.

win cas

STATEMENT OF THE CASE

The jurisdiction of the Court of first instance was based upon

an indictment by its Grand Jury charging the federal offenses of

conspiracy to commit mail fraud, substantive mail fraud of-

fenses, conversion of Union assets and filing annual LM-2

reports with the Department of Labor which were false in their

failure to report Petitioner’s receipt of such converted assets, all

in violation of 18 U.S.C. §§ 371 and 1341 and of 29 U.S.C.

§§439(b) and 501(c).

Under the stated questions, the material facts are the govern-

ment’s proof construed favorably to it in relation to the offenses

charged, the theories advanced for reversal, and the appellate

response thereto.

The indictment presented four separate theories of criminal

liability. The mail fraud theories were based upon the sale of

advertisements for three publications claiming themselves to be

sponsored by Petitioner’s local union. The conspiracy/mail

fraud publications were government witness Stamps’ ‘‘Labor

News’’ and co-defendant Lewellen’s' ‘‘Labor Journal’’ (Counts

I-VI), and the mail fraud publication was deceased Florida

publisher Pomporini’s ‘‘Tennessee Teamsters’ Yearbook’’

(Counts VII-XII), as to which acquittal was directed because the

government proved that the Union’s governing body had spon-

sored the latter publication.

The theory of the first conversion charge was that for his

publication rights, Pomporini owed the local Union one thou-

sand dollars which he never paid; but that instead two $500

payments made to Petitioner constituted a conversion of Union

assets prohibited by 29 U.S.C. § 501(c). The second conversion

'The co-defendant’s case was severed for institutional diagnosis as

to his mental-capacity to stand trial.

a oo

theory was that Petitioner converted Union assets by making

personal telephone calls over the Union’s telephone, and that he

caused the Union to pay for long distance calls made to race

tracks and other such places in matters unrelated to the Union’s

business (Count XIV). The final offenses charged were that

Petitioner failed to report on three annual LM-2 reports to the

Department of Labor the benefits he received as Union Presi-

dent in payment for his personal telephone calls which were

among the Count XV unauthorized calls (Counts XVI-XVIII).

Following is a summary of the government’s proof, the

defensive appellate contentions, and the rationale of the Court

of Appeals regarding these four groups of offenses--the Stamps

and Lewellen publications, the Pomporini $500 payments, the

telephone usage, and the LM-2 reports.

Regarding the Stamps-Lewellen publications, the Court of

Appeals correctly summarized defensive contentions that

although the government proved corrupt involvement by Peti-

tioner in sponsorship of Stamps’ paper, there was no proof that

the mails were used in this scheme so as to bring it within the

mail fraud statute; and that although the government proved

extensive use by Lewellen of the mail in his subsequent publica-

tions, there was no proof that Petitioner was a party to that

scheme. In viewing the two papers as one continuing scheme,

the Court took no note of other aspects of the government’s

proof: That Petitioner insisted the Court must analyze for itself

to determine whether there were single or successive con-

spiracies under Braverman v. United States, 317 U.S. 49, and

Kotteakos v. United States, 328 U.S. 750. That Stamps and

Lewellen had previously been employed as ad-sellers by another

**publisher’’ working under the claimed auspices of a Veterans’

organization and utilizing runners instead of the mails to pick

up ads and money; that the government affirmatively proved

that Stamps used runners in his solicitation for two issues he

ae ee

published,’ with Lewellen being one of the runners. That after

Stamps ceased publishing and left Tennessee almost two years

passed before Lewellen commenced publishing with his efforts

proven by records of his bank account opened and utilized

thereafter, testimony of advertisers, testimony of the printers

who printed his four issues and copies of each of the four issues

Lewellen printed. And that after Stamps returned to Tennessee,

he resumed his employment with the Veteran’s paper and did

not until later begin working as an employee of Lewellen as an

ad solicitor, without any duty or authority relating either to the

publication’s bank account or to its printing.

In regard to the Pomporini payments, the Court of Appeals

correctly noted that the contract obligated Pomporini to pay the

Union $1,000.00 for the first year’s publication, that Pomporini

had made two $500.00 payments to Petitioner, and the Court

concluded that the jury could discredit Petitioner’s testimony as

to an innocent reason for the payments to him personally and

could infer that these payments, totalling the amount due the

Union and made ‘“‘in close proximity to each other; was money

due to the Union.”’ (infra., p. A-28). Actually, the payments

were three years apart. The Court took no notice of the fact that

the government offered no evidence as to the purpose of the two

payments but merely proved that they were made by Western

Union Money Orders on two occasions when Petitioner was

present in Florida. The Court took no note of defensive legal

7In light of Petitioner’s continuing insistence upon his innocence it

should be said that these concessions as to government proof are re-

quired by respect for the jury’s right to determine credibility. It seems

not inappropriate, however, to point out that as contrasted with the

Lewellen operation, the government did not corroborate Stamps’

testimony with any bank records relating to monies he received from

ads, the testimony of any printer claimed to have printed his papers,

of any reader claimed to have examined them, or of any advertiser

claimed to have advertised in them, nor did the government produce

any copies of the papers themselves.

sale tei

contentions: For a Union officer to be guilty of the crime of

converting Union assets in violation of 29 U.S.C. § 501(c), the

government must prove that the asset had become property of

the Union at the time of its conversion. Statutory construction

of Sec. 501 requires this because sub-section (a) imposes the

fiduciary capacity upon certain Union officials, sub-section (b)

creates a civil cause of action in which violation of the fiduciary

obligation is essential by the plain words of the enactment, but

that the specific elements of the crime created by sub-section (c)

does not include fiduciary capacity or violation of fiduciary

obligations but merely subjects to equal criminal liability both

officers and employees for committing listed common-law torts

or crimes in relation to Union assets. The Court took no note of

defensive contention that Pomporini, utilizing negotiable in-

struments to make two payments to Petitioner, transferred legal

title directly into his name and that the Union never held legal ti-

tle to those negotiable instruments, even though Petitioner at all

times conceded that Pomporini was obligated to pay some

$1,000.00 to the Union.

Regarding the telephone usage, the government’s proof and

corresponding supporting theories fell into three different

categories. The first was personal calls made by Petitioner over

the Union telephone to a veterinarian supply house in South

Carolina for amounts totalling $2.07, $7.66 and $1.80 in three

successive years. Defensive contentions, aside from reliance on

appellant’s testimony, were: The indictment, charging calls to

race tracks and veterinarian supply houses in a number of dif-

ferent cities, did not mention any city in South Carolina so that

the calls proven were not alleged in the indictment but if alleged,

that the de minimus rule bars conviction for such small

amounts. The Court of Appeals made no mention of either of

these contentions or the adequacy of proof thereunder.

As to the second group of calls, the government proved that

appellant gave his Union credit card number to two non-

members for the purpose of making calls on Union business; it

proved that these individuals utilized the credit card number to

charge to the Union many of their own personal telephone calls

but it proved that they did this without the appellant’s knowl-

edge. The third category of telephone calls included all phone

calls made during the years in question to or from phone

numbers belonging to race tracks, nearby motels, etc., not

shown by the records to have been made by Petitioner to the

South Carolina telephone mentioned above. The governments’

evidence also showed, by cross-examination of present or

former Union officers and employees, that Petitioner was many

times present at or near race tracks near where he had official

grievance or negotiating functions to perform. The government

did not identify the individuals making any call nor offer

evidence as to the subject matter of any identified telephone call

except for the three years’ calls that Petitioner personally made

to the South Carolina veterinarian supply company.

It was Petitioner’s contention that such calls could not be at-

tributed to him, even though he signed most checks for the

monthly telephone bills, without a showing that they were

unrelated to Union business, in view of the fact that he has

many times been present near race tracks necessitating calls be-

ing made to him and responsive calls being made by him on

Union business due to his presidency of the local Union; and

without proof of either the identity of the individuals making

the calls, the individuals to whom the calls were made, or the

subject-matter of the calls.

In its discussion of these charges, the learned Court of Ap-

peals made no mention of these defensive positions, no allusions

to the evidentiary deficiencies in the government’s proof. The ©

Court of Appeals made no reference to the District Court’s

justification of the judgments of guilt on these counts upon the

theory that the jury was permitted to speculate as to guilt under

ae

their authority to render criminal decisions contrary to both the

law and the facts, as enunciated in Horning v. District of Col-

umbia, 254 U.S. 135, 138. Regarding the propriety of a jury’s

use of its discretion to speculate as to innocence by speculating

instead as of guilt as a basis of its verdict, the learned Court of

Appeals took no note of this Petitioner’s assertion: ‘‘The view

espoused by the District Court is a view rejected by the Supreme

Court: ‘The power of the fact-finder to err upon the side of

mercy, however, has never been thought to include the power to

enter an unreasonable verdict of guilty.” Jackson v. Virginia,

supra, 61 L.Ed.2d at p. 572, n. 10.’’ (Court of Appeals Brief, p.

40).

Petitioner presented a far more detailed summary of the

evidence in his brief to the Court of Appeals, and counsel

represents to this Court that the government, in its response, did

not endeavor to point out any inaccuracy in Petitioner’s sum-

mary of the pleadings, the evidence, the legal positions taken or

the actions of the District Court.

—~

REASONS FOR GRANTING THE WRIT

The decision, of the learned Court of Appeals is in conflict

with the applicable decision of this Court in Jackson v. Virginia,

supra. In its treatment as frivolous Petitioner’s urging that the

de minimus doctrine governs in application of statutes concern-

ing conversion by Union officials and reporting of benefits

received by them, the Court’s decision was in apparent conflict

with the rationale as to application of the de minimus doctrine

enunciated in Anderson v. Mt. Clements Pottery Co., 328 U.S.

680, 692, and also in conflict with the customary application of

that rule in criminal income tax cases in the jury charge that the

amount of the income under-statement must be substantial,

U.S. v. Eley, 314 F.2d 127 (7 Cir., 1963), Moore v. U.S., 360

F.2d 353 (4 Cir., 1965), U.S. v. Nunan, 256 F.2d 576 (2 Cir.,

1956). The action of the Court of Appeals in regard to other

issues either described above or growing from the legal and fac-

tual positions described above could be stated as in conflict with

decis.ons of other circuit courts of appeals.’

> For example, had the Court performed the Braverman-Kotteakos

obligation to determine from the evidence whether the Stamps-

Lewellen schemes, if credited, were a single conspiracy or multiple

conspiracies, the recognition of their separateness would have

rendered the Court’s decision sustaining conviction for conspiracy to

commit mail fraud in conflict with the holdings of other Circuit

Courts that while a prior contemplation of use of the mails is not

necessary for the substantive crime of mail fraud, it is necessary for

the crime of conspiracy to commit mail fraud, Fisher v. U.S, 327

F.2d 775 (8 Cir., 1963), cert. denied,*377 U.S. 999; Abbott

v. U.S., 239 F.2d 310 (5 Cir., 1956); and U.S. v. Donahue, 539 F.2d

1131 (8 Cir., 1976).

If the Court had considered and upheld Petitioner’s statutory con-

struction argument concerning the proper construction of 29 U.S.C. §

501(c), then its failure to reverse for the District Court’s refusal to

charge the jury that it must be proven that property has become the

property of a Union before a Union officer can be convicted of con-

verting Union property, would have presented a conflict, because of

holdings that a Court is obligated to give a requested charge accurately

defining the elements of the criminal offense unless covered elsewhere.

U.S. v. Nance, 502 F.2d 615 (8 Cir., 1974); U.S. v. Demetrie, 461 F.2d

971 (6 Cir., 1972); U.S. v. Brown, 461 F.2d 912 (6 Cir., 1972).

—

a | ee

However Petitioner conceives that such re-presentation to

this Court would amount to an endeavor to entice this Court

into performing the function of the Appellate Court of first

resort instead of the Appellate Court of last resort.

Hence, Petitioner believes and asserts that the writ should be

granted because the Court of Appeals has so far departed from

the accepted course of judicial proceedings and in some respects

has so sanctioned such a departure by the District Court, as to

call for the exercise of this Court’s power of supervision. And in

this aspect, the case presents a question of law which should be

but has not been decided by this Court, concerning the obliga-

tions of an Appellate Court in deciding an appeal of right rais-

ing substantial questions in a criminal case.

Where such questions are not frivolous on their face, it is

assumed that the appeal of right vested in a defendant imposes

upon an appellate court the obligation to consider issues whose

answer favorable to a defendant would require reversal and to

consider issues whose answer would require modification of the

decision being rendered by the appellate court. Maryland

Casualty Co. v. Jones, 279 U.S. 792, 796-797; Brown v.

Fletcher, 237 U.S. 583, 588; United States v. Ballard, 322 U.S.

78, 88.

Petitioner submits that in disposing of an appeal of right, the

obligation of the Appellate Court, at the very least, includes the

obligation imposed upon the judges to sufficiently acquaint

themselves with the record and with the Brief of Appellant—the

instrument which the Court is challenged to judge—to permit

them to rationally decide the issues presented. Certainly, when

an Appellate Court, in disposing of an appeal of right, merely

cites one case which is irrelevant to the issues raised by the ap-

peal, then the appellate function has not properly been per-

formed. Proctor v. Warden, Maryland Penitentiary, 435 U.S.

559. Similarly when, as here, the order in the nature of an opin-

ion presents multiple glaring inconsistencies with both the

ee

record and with the contentions made by the appellant, no ap-

pellant can believe that his case has received the study and the

thought merited by an appeal which raises serious questions.

Hence, Petitioner avers that this case does present a departure

from the accepted and usual course of appellate procedure. It is

a departure which Petitioner believes cries out for thorough

consideration by this Court. For the past several years, the

volume of cases handled by the intermediate appellate courts

has grown great to the extent that many decisions are rendered

without the enunciation of any rationale and a record of deci-

sion finds publication only in tables in the Federal Reporter,

Second Series. Each of these represents a possibility that

litigants leave the courts with the belief that their cases have

never received serious consideration. Each judicial opinion,

even with the brevity of those by Justice Holmes, enhances the

respect in which the judiciary is held, often enabling litigants to

perceive the wrongness of their legal positions. Each appellate

decision which leaves litigants with the impression that their

cases have not been considered thoughtfully and with adequate

knowledge carries with it the capacity to lessen confidence in the

judicial system.

This Court’s consideration of the subject of the rights which

inhere in the appeal of right and the obligations imposed upon

those deciding an appeal of right would be of inestimable value

to the bench, the bar and to defendants who go to prison believ-

ing no court has ever heard, read, or given thought to their

arguments.

a ee

WHEREFORE, Petitioner prays issuance of the writ of

certiorari.

Respectfully submitted,

CECIL D. BRANSTETTER

CARROL D. KILGORE

200 Church Street

Nashville, Tennessee 37201

Attorneys for the Petitioner

APPENDIX

a eee

APPENDIX A

IN THE UNITED STATES DISTRICT COURT

FOR THE MIDDLE DISTRICT OF TENNESSEE

No. 78-30269-NA-CR

United States of America,

Plaintiff,

Vv.

William L. ‘‘Corky’’ Ellis, et al.,

Defendants.

MEMORANDA OPINIONS AND ORDERS

(Filed March 28, 1979)

The jury found the defendant Mr. William L. (‘‘Corky’’)

Ellis guilty as charged in counts one through six, inclusive, and

fourteen through eighteen, inclusive, of the indictment herein.

After the discharge of the jury, Mr. Ellis elected timely to renew

his earlier motion for entry of a judgment of acquittal’ as to

each of those 11 counts. Rule 29 (c), Federal Rules of Civil

Procedure.

In deciding such motion, the crucial consideration is whether

the evidence as to each such count was sufficient to sustain a

conviction under that count; in other words: whether there was

relevant evidence from which the jury could have found or in-

' It is not incumbent upon this Court to ascertain whether Mr.

Ellis’ election along this line will preclude his relying on the grounds of

his renewed motion for entry of a judgment of acquittal on any appeal

herein. See Rule 4 (b), Federal Rules of Appellate Procedure. With

such a possibility in prospect, however, in fairness to Mr. Ellis, the

Court accorded that motion and those grounds ex. -nsive and intensive

consideration against the possibility that he may not be able to “‘take

another bite out of the same apple’’ before an appellate court.

—" pe

ferred properly beyond a reasonable doubt that the defendant is

guilty as charged. American Tobacco Co. v. United States

(1946), 328 U.S. 781, 787 n. 4, 66S. Ct. 1125, 90 L. Ed. 1575,

1582 n. 4. The late Judge Prettyman expressed the guiding rule

this way:

*s* ee

The true rule, therefore, is that a trial judge, in passing

upon a motion for directed verdict of acquittal, must

determine whether upon the evidence, giving full play to

the right of the jury to determine credibility, weigh the

evidence, and draw justifiable inferences of fact, a

reasonable mind might fairly conclude guilt beyond a rea-

sonable doubt. If he concludes that upen the evidence

there must be such a doubt in a reasonable mind, he must

grant the motion; or, to state it another way, if there is no

evidence under which a reasonable mind might fairly con-

clude guilt beyond a reasonable doubt, the motion must be

granted. If he concludes that either of the two results, a

reasonable doubt or no reasonable doubt, is fairly possi-

ble, he must let the jury decide the matter.

Curley v. United States, C. A. D. C. (1947), 160 F. (2d) 229,

232-233, certiorari denied (1947), 331 U. S. 837, 67S. Ct. 1511,

1512, 91 L. Ed. 1850; accord: United States v. Gaines, C. A. 6th

(1965), 353 F. (2d) 276, 278 [8].

The evidence at this juncture in the proceedings is to be view-

ed in the light most favorable to the prosecution. Glasser v.

United States (1942), 315 U. S. 60, 80, 62 S. Ct. 457, 86 L. Ed.

680, 704 (headnote 17); United States v. Collon, C. A. 6th

(1970), 426 F. (2d) 939, 942 [2]. In that light, the Court views the

evidence as follows:

Historically, presidents of the local labor organization

of Teamsters at Nashville, Tennessee (union) seem to have

managed its treasury as if it were their private preserve. As

mae pet

an example, while serving in this capacity, Mr. Don Vestal

operated to his own private gain, with no ostensible benefit

to the union, a newspaper in which business concerns and

individuals who desired the good-will of the union pur-

chased advertising (of dubious value to them). That publi-

cation was printed upon presses located in the basement

area of the union headquarters. Eventually, Mr. Vestal

was removed from his office by judicial fiat, and the union

was operated under a trusteeship of its parent, interna-

tional-union.

Mr. Ellis was the first member-elected president of the

union after the termination of that trusteeship. Along the

way, those printing presses were moved from the union’s

headquarters-building, and there has not been since an

equally blatant perversion of the union’s prestige for

private gain.

To fill this void and for private fiscal enhancement, Mr.

Ellis entered into a two-pronged conspiracy to profit per-

sonally from publications, established by others, seeking

to reap the harvest of the then-untapped available advertis-

ing revenues. On behalf of the union, he entered into a

contractual arrangement with D. & P. Associates, Inc. (D.

& P.), represented by a Mr. Pomporini, whereby D. & P.

would publish 3 annual editions of the Tennessee Team-

ster’s Yearbook (Yearbook), and the union would be paid

a minimum of $1,000 a year from the proceeds.

Belatedly, the union ‘‘accepted”’ this project, but none

of the cash consideration it was to be paid therefrom ever

reached its treasury; Mr. Pomporini paid a sum of money

to Mr. Ellis (which Mr. Ellis testified was in repayment of a

personal loan and constituted in no part union funds). In

any event, no money received from Mr. Pomporini or D. &

P. was placed in the union’s treasury by Mr. Ellis.

—=_

Mr. Ellis also entered into an agreement with Mr. Cecil

Stamps, a convict at time of trial, for the publication of the

Tennessee Labor News (News), The union at no time ac-

quired any property or other interest in this newspaper, but

Mr. Stamps made cash payments to Mr. Ellis for the

latter’s tolerance of this project. But 2 editions of this pub-

lication were issued, after which Messrs. Stamps and Ellis

decided to allow advertisers therein ‘‘* * * to rest a little

while. * * *’’ At the conclusion of this rest-period, publi-

cation was resumed, this time under the name, The Ten-

nessee Labor Journal (Journal).

Mr. Ellis’ codefendant Mr. Nelson T. Lewellen, not on

trial jointly with him, was a coconspirator with Messrs.

Ellis, Pomporini and Stamps. He acquired in the Nash-

ville, Tennessee Post Office rental post office box no. 8162

in the name of the Journal and utilized the mail extensively

in connection with the business of that publication.

Throughout, it was a part of the scheme agreed upon by

the conspirators to keep the operation of these publica-

tions as far removed in the public view from Mr. Ellis as

possible, and to conceal from advertisers whether these

publications were, or were not, projects which benefitted

the union and its general membership. As many of the ad-

vertisers were in places far removed from Nashville, it was

an essential part of the conspirators’ plot that the mail be

used by advertisers to pay the Journal for the advertise-

ments which had been purchased. 5 or more of these re-

spective advertisers were caused by Mr. Ellis, through one

or another of his coconspirators, to utilize the mail in the

execution of their scheme.

The interest the union acquired by contract in the publi-

cation of the Yearbook was a property-interest, and Mr.

Ellis converted that interest to his own use or the use of

some other person.

a

The foregoing is believed to be a fair statement of the essen-

tial facts of this lawsuit as they relate to all counts of the indict-

ment, under which Mr. Ellis was convicted, with the exception

of the latter (numerically) 4 counts thereof. As to those latter

counts, the salient facts under the view most favorable to the

prosecution are:

The union furnished Mr. Ellis with an automobile; he

was authorized to use this vehicle for his personal and

private business as well as for union business. Mr. Ellis’

telephone tolls on union business were authorized also by

the union; but, he was not authorized to charge tolls which

related to his personal and private business to the union’s

telephones. Mr. Ellis was authorized (implicitly or express-

ly) also to use a credit-card to charge to the union’s tele-

phones long distance tolls on union business for calls

which he made on telephones other than the union’s tele-

phones; he was not authorized by the union to authorize

anyone else to charge telephone tolls to its telephones

unless for the benefit of the union.

Mr. Ellis made personal long distance telephone calls at

union expense to order veterinary supplies for his horses.

He engaged on his private business 2 different persons to

train and otherwise attend to his personal racehorses, in-

cluding racing them in Louisiana and Florida. One of these

trainers, Mr. John Thomas Hickman, used the auto-

mobile, assigned to Mr. Ellis’ unrestricted use, to transport

one of Mr. Ellis’ racehorses. Mr. Ellis gave Mr. Hickman

the number of the union’s telephone credit-card and in-

structed him to utilize it as necessary in connection with

that transportation. Mr. Hickman charged one such call

on that card for such reason; however, thereafter, Mr.

Hickman also charged his personal calls placed to his own

relatives on that card.

ae aan

The other trainer, Mr. George Akin, was also given such

number by Mr. Ellis, to use in contacting by telephone un-

employed members of the union, with whose whereabouts

Mr. Akin was more familiar than Mr. Ellis, and conveying

to them information relating to job-openings to be filled

on the referral of the union. Mr. Akin went farther and

allowed his nephew to charge on the card telephone tolls

for calls he made from Louisiana and Florida to his girl-

friend back in Tennessee. In an 1l-month period, Mr.

Akin was responsible in this manner for the charging of

tolls to the union’s telephones in the aggregate amount of

some $1,000.

Mr. Ellis, as president of the union, was an essential

signatory on annual reports of the union under the Labor-

Management Reporting and Disclosure Act, 29 U.S. C. §§

401, et seq. His salary and other compensation from the

union exceeded $10,000 annually. He was required to dis-

close, or cause the union to disclose, all material facts con-

cerning his salary, allowances, and other direct and in-

direct disbursements to himself as such officer. 29 U. S. C.

§ 431 (b) (3). In reports for the respective years, 1974-1976,

inclusive, Mr. Ellis failed to disclose, or cause to be dis-

closed by the union, the compensation he received repre-

sented by the value of the aforementioned telephone calls.

This misrepresentation or failure to disclose a material

fact, knowing the representation to be false, was done

knowingly by Mr. Ellis. See 29 U. S. C. § 439 (b).

The immediately foregoing is believed to be a fair statement

of the facts of this lawsuit as they relate to the final 4 counts of

the indictment. From the foregoing (in its entirety), it will be

seen readily that the evidence was sufficient to sustain Mr. Ellis’

conviction under count fourteen. The jury could have deducted

inferentially that the money Mr. Pomporini paid Mr. Ellis

belonged to the union as a property-right under its contract with

i ie es

D. & P., and that Mr. Ellis, with intent to defraud, converted

that money or property of the union to his own use or the use of

someone else.

The evidence was sufficient to sustain Mr. Ellis’ conviction

under count fifteen also, unless the jury accredited Messrs.

Ellis, Hickman and Akin perfectly as witnesses and gave full

weight to their testimony exculpating Mr. Ellis. By its verdict on

this count, the jury appears on this point to have discredited

those witnesses or given their exculpatory testimony little or no

weight. The jury could have inferred reasonably that Mr. Ellis

extended Messrs. Akin and Hickman carte blanche to use the

union’s telephone credit-card anyway each of them chose.

Despite the fact that there was no direct evidence probative of

the fact that Mr. Ellis allowed Messrs. Akin and Hickman and

any person(s) they might designate to use this card at-will, this

was a finding nevertheless, the jurors could have made by rea-

sonable inference upon assessing the credibilities and weights of

the witnesses and the pertinent testimony. In a criminal action

such as this, the jury ‘‘* * * has the power to bring in a verdict

in the teeth of both law and facts.* * *’’ Horning v. District of

Columbia (1920), 254 U. S. 135, 138, 41 S. Ct. 53, 65 L. Ed.

185, 186-187. ‘** * * [J]juries are not bound by what seems in-

escapable logic to judges.* * *’’ Morissette v. United States

(1952), 342 U. S. 246, 276, 72 S. Ct. 240, 96 L. Ed. 288, 307.

Mr. Ellis would have this Court apply the de minimis rule,

which is applied in some criminal prosecutions, and set-aside the

verdicts of the jury as to counts fifteen through eighteen, in-

clusive, because the amounts of the telephone calls involved are

comparatively small, when all the annual disbursements of the

union are taken into account. The Court cannot do this

appropriately.

The Congress fashioned an entirely new crime in the enact-

ment of 29 U.S. C. § 501 (c), the scope of which is far more ex-

tensive than that applied to acts of a somewhat similar nature

— .

which had been made federal crimes earlier. United States v.

Nell, C. A. Sth (1976), 526 F. (2d) 1223, 1232 [15]. The Labor-

Management Reporting and Disclosure Act, supra, of which it

is a part, was based upon congressional findings that:

ese ee 28

The members of a labor organization are the real owners

of the money and property of such organizations and are

entitled to a full accounting of a// transactions involving

such money and property. Because union funds belong to

the members they should be expended only in furtherance

of their common interest. A union treasury should not be

managed as though it were the private property of the

union officers, however well-intentioned such officers

might be, but as a fund governed by fiduciary standards.

{Emphasis added.]

se ee 2 8

House Report no. 741 of the Committee on Education and

Labor. So, all of the funds of a labor organization must be

treated as trust funds belonging to the union’s members. United

States v. Goud, C. A. 8th (1974), 490 F. (2d) 1158, 1162 [2], cer-

tiorari denied (1974), 417 U. S. 975, 94S. Ct. 3068, 41 L. Ed.

(2d) 665. If any of those funds have been unlawfully converted

or not properly reported, crimes have been committed.

Mr. Ellis claims that evidence is lacking to support his convic-

tion under (the conspiracy) count one of the indictment, in that

it was not proved that the conspirators contemplated the use of

the mails in furtherance of their fraudulent scheme relating to

the publication of the Journal. This contention likewise has no

merit.

Once the jury found that a conspiracy to defraud advertisers

in the publication under consideration had been devised, and

letters had been mailed in the execution of that scheme, it was

not necessary for the jury to have found in addition ‘‘* * * that

—

the scheme contemplate[d] the use of the mails as an essential

element * * *’’ of the crime, so long as the jury found that ihe

mailing ‘‘* * * was incident to an essential part of the

scheme. * * *’’ Pereira v. United States (1954), 347 U. S. 1, 8,

74 S. Ct. 358, 98 L. Ed. 435, 444 (headnote 9); accord: United

States v. Maze (1974), 414 U. S. 395, 400, 94S. Ct. 645, 38 L.

Ed. (2d) 603, 608 [5], and United States v. Street, C. A. 6th

(1976), 529 F. (2d) 226, 228-229 [1].

Mr. Ellis takes the position that, if there were any con-

spiracies herein, they were separate as regards the Journal, on

the one hand, and the News, on the other. He assumed in his

brief that the Court had ‘‘* * * already recognized * * *”’ this

separateness.

The distinction the Court had in mind related to the Year-

book, on the one hand, and the Journal, on the other. There

was allusion to this in the Court’s memorandum opinion and

order herein of February 16, 1979, in which the Court wi hdrew

from the further consideration of the jury counts seven through

thirteen, inclusive, of the indictment.

As the Court understood the evidence at that time, the bilking

of the advertisers in the Yearbook was predicated by the pros-

ecution on the statement, it claimed to have been false, fraud-

ulent, and misleading, that the Yearbook was authorized and

sponsored by the union It was undisputed in the evidence that

the Yearbook project was indeed accepted by the union; so,

such statement was neither false, fraudulent, or misleading.

Regarding count thirteen, it was demonstrated affirmatively

that the union at no time had as an asset any money, ownership

or property-interest in the Journal. This being true, Mr. Ellis

could not have knowingly converted to his own use or the use of

someone else ‘** * * mercy, property or other assets * * *”’ of

the union in relation to the Journal, as opposed to the Year-

book.

— A-10 —

The evidence was sufficient also to sustain a conviction of

Mr. Ellis as an aider-and-abettor of Messrs. Stamps and

Lewellen, or one of them respectively, in causing the various

checks to be mailed to the post office box of the Journal in pay-

ment of advertising therein, as charged in counts two through

six, inclusive, of the indictment. Reiterating to some extent,

there was evidence of a conspiratorial scheme by Messrs. Ellis,

Lewellen, Stamps and others to bilk advertisers fraudulently

and obtain money in this way from them upon known false rep-

resentations, as charged in each of the counts now under consid-

eration; that Messrs. Lewellen or Stamps, or one of them re-

spectively in each instance, knowingly caused mail-delivery of a

check in payment of such advertising; that the causing of the

mails to be used in this manner was done by them willfully and

with the specific intent by Mr. Ellis to carry-through the scheme

he had participated in devising; and that, although he did not do

any of these acts physically himself, he aided-and-abetted his

coconspirators in so doing and/or caused willfully these acts to

be done by them.

There was no reasonable doubt that Mr. Ellis associated

himself in these substantive acts of mail-fraud by his cohorts;

that he participated in the transactions as something he wished

to bring about; and that he sought by his own action to make

their scheme succeed; accordingly, he is as guilty as his cohorts,

Nye & Nissen v. United States (1949), 336 U. S. 613, 619, 69S. .

Ct. 766, 93 L. Ed. 919, 925 (headnote 4), because he shared con-

sciously their criminal venture, Pereira v. United States, supra,

347 U. S. at 11, 98 L. Ed. at 446 (headnote 17). As to each of

these counts now under consideration, it was not a prerequisite

to a conviction of Mr. Ellis that the cohort actually committing

physically the unlawful acted charged have been identified. Am-

brose v. United States, D. C. Tenn. (1974), 384 F. Supp. 681,

682, affirmed C. A. 6th (1974), 508 F. (2d) 843 (table).

Mr. Ellis laid as additional grounds for his motion for a post-

trial entry of a judgment of acquittal, as to the foregoing 11

—

— A-ll —

counts, alleged errata in the Court’s instructions to the jury. Of

course, these could not be, and are not, a cognizable ground for

such a motion.

Because of the nature of the evidence as a whole, and the

disparity of inferences which could have been drawn therefrom

reasonably, especially with reference to any criminal intent of

Mr. Ellis, or lack of it, in each instance, this Court is forced to

the conclusion that the evidence was such that any reasonable

mind might have had fairly a reasonable doubt as to Mr. Ellis’

guilt or might not have had such a doubt in that respect.

‘# #°* Where [the] intent of the accused is an ingredient of the

crime charged, its existence is a question of fact which must be

submitted to the jury. * * *’’ Morisette v. United States, supra,

342 U. S. at 274, 96 L. Ed. at 306 (headnote 15); accord: United

States v. Bryant, C. A. 6th (1972), 461 F. (2d) 912, 920 [12], and

United States v. Luxenberg, C. A. 6th (1967), 374 F. (2d) 241,

249 [16]. Accordingly, his posttrial motion for entry of a judg-

ment of acquittal as to each of the 11 remaining counts of the

indictment must be, and hereby is,

OVERRULED, cf. United States v. Sutton, C. A. D. C.

(1969), 426 F. (2d) 1202, 1210 {11}.

Mr. Ellis moved timely also for a new trial, Rule 33, Federal

Rules of Criminal Procedure, asserting several alleged errors

which had occurred during the trial as grounds therefor. The

Court has discretion to determine whether, in the interest of

justice, a new trial should be granted. Petro v. United States, C.

A. 6th (1954), 210 F. (2d) 49, 53 [10], certiorari denied sub nom.

Sanzo v. United States (1954), 347 U. S. 974, 978, 74S. Ct. 785,

790, 98 L. Ed. 1114, 1116. (The Court addresses those grounds

only to the extent they have not been addressed earlier herein.)

It is claimed that the Court erred in sending to the jury-room

the exhibits which had been admitted in evidence over the objec-

tion of Mr. Ellis. His objection extended to all exhibits.

— A-12 —

It has long been the practice of the undersigned judge not to

send any exhibits to the jury-room unless they are called-for by

a deliberating jury, on the theory that documentary evidence

should not be emphasized ordinarily above testimonial evi-

dence; and, if any exhibit is sent-in, all are sent-in; to avoid un-

usually emphasizing any particular piece of the documentary

evidence. The Court devoted 5 days to the reception of evidence

herein; there were a multiplicity of exhibits admitted into

evidence; the jury was asked to return verdicts as to 11 separate

crimes, many of which implicated documentary evidence. There

was no abuse of the Court’s discretion in honoring under the

circumstances the jury’s request for all the exhibits. Cf. United

States v. Foster, C. A. 6th (1969), 407 F. (2d) 1335, 1336 [3],

certiorari denied (1969), 396 U. S. 862, 90S. Ct. 134, 24 L. Ed.

(2d) 114.

Although exhibits admitted on the issues implicated in the

counts which were afterward withdrawn from the jury’s con-

sideration were included in the delivery, these exhibits con-

tinued to have a relevance on its determination of Mr. Ellis’

state-of-mind at the pertinent times. United States v. Curtis, C.

A. 10th (1976), 537 F. (2d) 1091, 1097 [13], [14], certiorari

denied (1976), 429 U. S. 962, 97S. Ct. 589, 50 L. Ed. (2d) 330.

No error was committed in this matter. Cf. Neely v. United

States, C. A. 9th (1962), 300 F. (2d) 67, 75 [11], certiorari

denied (1962), 369 U. S. 864 82 S.Ct. 1030, 8 L. Ed. (2d) 84.

Mr. Ellis also contends that he was prejudiced on the latter

counts under which he was convicted by evidence relating to the

earlier counts (and apparently vice versa). He argues that if the

jury had considered separately each count, and only the

evidence relating to that particular count, he would not have

been convicted. In this connection, the Court instructed the jury

as follows:

ses eee *

— =

A seperate crime or offense is charged in each of the re-

maining 11 counts of this indictment. Each offense and the

evidence applicable thereto should be considered separately.

The fact that you may find Mr. Ellis guilty, or not guilty,

of the offense charged in any one count, should not con-

trol your verdict with respect to the offenses charged in the

other counts.

see eee te

The jury must be presumed to have been capable of sorting-

out the evidence and considering each count separately. See

United States v. Frazier, C. A. 6th (1978), 584 F. (2d) 790, 795

[10]. This Court is not aware of any specific instance wherein

the jury might have been confused by the scope of the proof or

was unable to limit the evidence to a single count where so re-

quired. See United States v. Grunsfeld, C. A. 6th (1977), 558 F.

(2d) 1231, 1237, certiorari denied (1977), __._ U. S. ___, 98 S.

Ct. 219, ____ L. Ed. (2d) ___. In light of the foregoing instruc-

tions, it must be assumed that evidence relating to any one

count did not taint the verdict of the jury as to any other count.

United States v. Parker, C. A. 9th (1970), 432 F. (2d) 1251, 1255

[3].

The Court is not persuaded by Mr. Ellis’ claim of selective

prosecution. Some degree of selectivity is inherent in every pros-

ecution, and there is not in this recora the slightest intimation

that the government’s decision to prosecute Mr. Ellis herein was

based upon impermissible standards, or that such decision was

made in bad faith. See United States v. Cooper, C. A. 6th

(1978), 577 F. (2d) 1079, 1086 [7].

A disturbing ground of Mr. Ellis’ motion for a new trial is

that the prosecuting attorney was guilty of prejudicial miscon-

duct in undertaking to impeach his character inferentially, by

proof that Mr. Pomporini had been convicted during his life-

time of mail-fraud. Mr. Pomporini was deceased at the time of

~~ ee

this trial. Both the prosecuting attorney and defense counsel

had developed earlier through witnesses a great deal that Mr.

Pomporini was reported to have done and, without objection,

said. There had been no previous attack by either party by opin-

ion or reputation evidence or otherwise on the character of Mr.

Pomporini for truthfulness. Nonetheless, the prosecuting at-

torney asked a witness in rebuttal concerning an earlier convic-

tion of Mr. Pomporini for the felony of mail-fraud.

Rule 404 (b), Federal Rules of Evidence, states very plainly

that ‘‘* * * [e]vidence of other crimes * * * is not admissible to

prove the character of a person in order to show that he acted in

conformity therewith. * * *’’ Sub-§ (a) of the same rule

reiterates that ‘‘* * * [e]vidence of a person’s character or a

trait of his character is not admissible for the purpose of prov-

ing that he acted in conformity therewith on a particular occa-

sion, except: * * *’’ as related to (1) the accused, (2) the victim

of the crime, or (3) a witness ‘‘* * * as provided in rules 607,

608, and 609.”’

As Mr. Pomporini was none of these 3 excepted persons, in

so far as this case is concerned, the purpose of the prosecuting

attorney must be said to have been to show that Mr. Pomporini

acted in conformity with his character as a mail-fraud convict in

dealing with Mr. Ellis, and thereby to suggest that the jury infer

that Mr. Ellis’ conduct was also of a mail-fraud nature.

If such was tiie purpose of the prosecuting attorney, such

evidence was irrelevant and barred: proof of the conduct of a

third person is prohibited where the evidence is offered to prove

his or her character as a basis for an inference as to his or her

conduct; and the conduct of a third person offered to prove the

character of the accused is barred as evidence of the defendant’s

conduct. 22 Wright & Graham, Federal Practice and Procedure,

457-458, Evidence, § 5239. ‘‘* * * An important element of a

fair trial is that a jury consider only relevant and competent

evidence bearing on the issue of guilt or innocence. * * *”’

— A-15 —

Bruton v. United States (1968), 391 U. S. 123, 131, 88 S. Ct.

1620, 20 L. Ed. (2d) 476, 482 [5], n. 6. Testing the credibility of

a person by showing a previous conviction of a felony is proper

only when the credibility of that person has been put in issue.

United States v. Benson, C. A. 6th (1966), 369 F. (2d) 569, 572

[6].

It is appropriate to repeat here the recent observation of Cir-

cuit Judge Keith, of our Court of Appeals, with regard to the

great responsibility an attorney for the government bears in

prosecuting a person for crime:

+e eee ee

* * * Once again we quote the ‘‘oft-repeated and some-

times ignored’’ [footnote reference omitted] words of the

Supreme Court in Berger v. United States, 295 U. S. 78, 88

(1935):

The United States Attorney is the representative not of

an ordinary party to a controversy, but of a sovereignty

whose obligation to govern impartially is as compelling as

its obligation to govern at all; and whose interest, there-

fore, in a criminal prosecution is not that it shall win a

case, but that justice shall be done. As such, he is in a

peculiar and very definite sense the servant of the law, the

twofold aim of which is that guilt shall not escape or in-

nocence suffer. He may prosecute with earnestness and

vigor—indeed, he should do so. But, while he may strike

hard blows, he is not at liberty to strike foul ones. It is as

much his duty to refrain from improper methods cal-

culated to produce a wrongful conviction as it is to use

every legitimate means to bring about a just one.

More to the point of the facts of this case are the words of Mr.

Justice Douglas:

The function of the prosecutor under the Federal Con-

stitution is not to tack as many skins of victims as possible

— A-16 —

to the wall. His function is to vindicate the right of people

as expressed in the laws and give those accused of crime a

fair trial.

Donnelly v. DeChristoforo, 416 U.S. 637, 648-649 (1974)

(Douglas, J. dissenting). United States v. Bess, C. A. 6th (1979),

a , (no. 78-5095, decided and filed

February 28, slip op. pp. 7-8); accord: United States v.

Steinkoetter, C. A. 6th (1979), ___._ F.. (2d) ’ (no.

78-5331, decided and filed February 28, slip op. pp. 2-3).

Immediately when this improper method of the prosecuting

attorney surfaced, the Court took him to task, rebuked him

pointedly and sternly in the presence of the jury, and explained

to the jury that it would constitute a violation of their own

oaths, to decide the guilt or innocence of Mr. Ellis according to

law, unless this inappropriate question were disregarded by

them. In addition to the instantaneous instructions given the

jury upon overruling Mr. Ellis’ motion for a mistrial, the Court

repeated in the principal instructions afterward:

**s* eee #8 &

***/YJou must consider nothing but legal evidence

presented before you in support of the charges against Mr.

Ellis.

ses eee * *

* * * [A]jny conviction of Mr. Ellis must be based only

on evidence.

ese ee £2 &

Any evidence * * * you were instructed by the Court to

disregard must be entirely disregarded * * *. You are to

consider only the evidence in this particular lawsuit.

****e eee

— A-17 —

When the Court sustained an objection to a question ad-

dressed to a witness, you must disregard that question; you

must draw no inference from the wording of the question;

and you must noi speculate as to what the witness might

have said if he had been permitted to answer.

s+ ne eee

Remember also, please, that Mr. Ellis is not on trial for

any act or conduct not alleged in the remaining counts of

this indictment. * * * You are not called on to return a

verdict as to the guilt or innocence of any other person or

persons.

****e 4 &

‘“** * * It is the general rule that cautionary instructions to a

jury to disregard * * * improper and prejudicial questions * * *

are deemed to cure such errors. * * *’’ United States v.

Haskins, C. A. 6th (1965), 345 F. (2d) 111, 115 [9]. It is believed

that the limiting instructions given were sufficient to protect Mr.

Ellis’ constitutional right to a fair trial. Cf. Frazier v. Cupp

(1969), 394 U. S. 731, 735, 89 S. Ct. 1420, 22 L. Ed. (2d) 684,

691 [2].

Next for consideration is whether Mr. Ellis was prejudiced

beyond his constitutional right by this prosecutorial miscon-

duct. In the exercise of its discretion in passing upon the motion

of Mr. Ellis for a new trial on this ground, the Court holds in

mind the harmless-error provisions of Rule 52, Federal Rules of

Criminal Procedure, and will not grant a new trial unless the

substantial rights of Mr. Ellis were affected by the method

employed. The gravity of the prosecuting attorney’s act is an

important element in deciding that. Kyle v. United States, C. A.

2d (1961), 297 F. (2d) 507, 514 [5], certiorari denied (1964), 377

U. S. 909, 84 S. Ct. 1170, 12 L. Ed. (2d) 179.

— A-18 —

As the late Circuit Judge Friendly reasoned:

*eeeune &

* * * [Wjhere the conduct of the trial has been less cen-

surable, or not censurable at all, a greater showing of prej-

udice is demanded, because the interest in obtaining an

ideal trial, with the trier of fact considering all admissible

evidence that has become available, and nothing else, is

not thus supplemented and may not outweighed by the in-

terest in avoiding a retrial unlikely to have a different out-

come * * *,

Idem. The method employed by the prosecuting attorney herein

is a matter of the gravest concern to the Court; but, it is doubt-

ful that another trial of 6 or more days would be perfect in all of

its aspects, or that it would produce a different result.?

The Court is not cognizant of any other undesirable or

pernicious element which might have infected the proceedings.

With only one possible exception, infra, it is believed by the

Court that the lengthy instructions to the jury are correct.

The convictions of Mr. Ellis fall somewhere naturally into

two categories, each of them with one sub-category. The first

category related to Mr. Ellis’ dealings with Mr. Pomporini with

reference to the Yearbook and with Messrs. Stamps and

Lewellen with regard, first, to the News, and, afterward, the

Journal, and the subcategory is the latter two persons’ and Mr.

Ellis’ causing the mail to be used in implementation of their pre-

arranged plan. The second category related to Mr. Ellis’ conver-

2 «¢* * * [I]nstances occur in almost every trial where inadmissible

evidence creeps in, usually inadvertently. ‘A defendant is entitled to a

fair trial but not a perfect one.’ * * *”’ Bruton v. United States, supra,

391 U. S. at 135, 20 L. Ed. (2d) at 484, quoting from Lutwak v.

United States (1953), 344 U. S. 604, 619, 73 S. Ct. 481, 97 L. Ed. 593,

604.

— A-19 —

sion of union property or funds in connection with the Year-

book and in his utilization for private purposes of the union’s

long distance telephone service, with this sub-category pertain-

ing to his failing to cause to be reported this additional compen-

sation he had received as a result of the telephone use.

The proof of Mr. Ellis’ guilt of the charges in these two

categories was strongly supported by the evidence of his acts;

the only really viable questions related to whether he had had

the necessary criminal intent. As the evidence had shown there-

tofore that one of his coconspirators, Mr. Stamps, was a con-

vict, this development of the fact that Mr. Pomporini was also a

convict probably had little bearing on the jury’s decision as to

that intent.

Even though this Court is of the considered view that the

method employed by the prosecuting attorney had only a

minimal degree of potential prejudice to Mr. Ellis under the cir-

cumstances, this does not end proper inquiry. The practice of

any attorney for the government, in offering prejudical evidence

which he or she should know is inadmissible, is condemned

throughout this entire circuit; so the delving must go deeper.

The Court (without the benefit of the record before it) cannot

now recall any other conduct on the part of the prosecuting at-

torney on a par with this misconduct; the trial was somewhat

long, and this constituted but an isolated incident in it. The

Court is not persuaded fully that the attorney for the govern-

ment used this tactic with the deliberate motive to ‘‘nail’’ Mr.

Ellis’ ‘‘skin to the wall.’’

It is believed that the action, attitude and actual language of

the Court, in seeking to overcome or, at least, dissipate, any

prejudice caused Mr. Ellis, was effective in accomplishing that

end. The verdicts the jury returned after a surprisingly brief

period of deliberation on 11 separate crimes reflects that its

members had little difficulty in finding Mr. Ellis guilty as charg-

ed on the proof adduced on the trial. Under the aggregate of

— A-20 —

those circumstances, the error committed by the prosecuting at-

torney, while never to be condoned by this Court, may be said

safely to have been harmless. Cf. United States v. Leon, C. A.

6th (1976), 534 F. (2d) 667, 679 [13], citing inter alia Donnelly v.

DeChristoforo, supra.

In the light of this survey, this Court is able to declare beyond

a reasonable doubt its belief that this error of the prosecuting at-

torney affected no constitutional or other substantial right of

Mr. Ellis and was harmless in the overall picture. Rule 52,

supra. This Court has concluded, albeit uneasily, that there was

not a reasonable possibility that the question asked contributed

to Mr. Ellis’ conviction. Chapman v. California (1967), 386

U.S. 18, 22-24, 87 S. Ct. 824, 17 L. Ed. (2d) 705, 709, 711 [5],

[6, 7], rehearing denied (1967), 386 U. S. 987, 87 S. Ct. 824, 17

L. Ed. (2d) 705, and 386 U. S. 987, 87 S. Ct. 1283, 18 L. Ed.

(2d) 241.

Mr. Ellis asserts error in the Court’s instructing the jury that

it had ‘‘* * * authority to judge the legitimacy of [uJnion ex-

penditures, judgment which is vested solely in union officials ex-

cept upon issues as to whether [certain] expenditures violate

particular laws prohibiting them.’’ This Court is in agreement

with Mr. Ellis, to the extent that a labor organization may ex-

pend its funds and assets for any lawful purpose it may see fit;

however, this Court does not agree that the exclusive judgment

of the propriety of an expenditure of a labor organization is

reposed “‘* * * solely in union officials. * * *”’

The Labor-Management Reporting and Disclosure Act,

supra, imposes a very broad fiduciary duty upon officers of a

union to protect the general membership of the union from the

corruption of their officers and others. 29 U. S. C. § 501 (a). A

union cfficial must ‘‘* * * hold its money and property solely

for the benefit of the organization and its members * * *, ex-

pend the same in accordance with its constitution and bylaws

and any resolutions of [its] governing [body] adopted there-

— A-21 —

under, * * * refrain from * * * holding or acquiring any pecu-

niary or personal interest which conflicts with the interests of

such organization, and * * * account to the organization for

any profit received by him in whatever capacity in connection

with transactions conducted by him or under his direction on

behalf of the organization. * * *’’ Idem.* It very well may be

the prerogative of union officials to ascertain initially whether

union funds are disbursed in accordance with a union’s con-

stitution, bylaws and resolutions adopted thereunder by its

governing body; but, whether that determination may be, it

must be found to conform to the foregoing statutory mandate.

In charges of a violation of 29 U. S. C. § 501 (c), the courts

are in agreement with regard to the essential elements of the

crime relating to disbursements which have been authorized by a

union. United States v. Bane, C. A. 6th (1978), 583 F. (2d) 832,

835-836 [2]. The essential elements of that crime are not yet

delineated as clearly with relation to unauthorized disburse-

ments. /bid., 583 F. (2d) at 835; but see and cf. United States v.

Goad, C. A. 8th (1973), 490 F. (2d) 1158, 1166, certiorari denied

(1974), 417 U.S. 945, 94S. Ct. 3068, 41 L. Ed. (2d) 665, contra:

United States v. Ottley, C. A. 2d (1975), 509 F. (2d) 667, 671

[2]. However, by way of dictum, our own Court of Appeals

(with the author a member of the adjudicating panel) has ap-

proved the giving of an instruction to the jury in such a case, to

the effect that a guilty verdict is warranted if funds authorized

by a union were not .expended within the limitation of the

authorization given. United States v. Bane, supra, 583 F. (2d) at

835, n. 7.

* Interestingly to the Court, the Congress in its wisdom did not

make the breach of these fiduciary duties by the officer of a labor

union a criminal offense; there must be a violation of 29 U. S. C. § 501

(c) to implicate a criminal penalty under the Act, although a breach of

those duties does give rise to a civil action under 29 U. S. C. § 501 (b).

— A-22 —

In respect to the telephone calls and use of the union auto-

mobile, an issue was whether Mr. Ellis’ authorization from the

union was exceeded; in respect of the payment to the union by

D. & P., an issue was whether Mr. Ellis had embezzled or con-

verted to his use or the use of another person money belonging

rightfully to the union.

It was made perfectly clear in United States v. Goad, supra,

490 F. (2d) at 1166, that, if an official of a union spends funds

that have been authorized by the union by mistake or accident,

‘** * * he is not liable under § 501 (c). * * *’’ It is clear, fur-

thermore, that, if an official of a union expended union funds

which were unauthorized in a good-faith belief that the union

would grant authorization after-the-fact, he is not liable under §

501 (c). United States v. Santiago, C. A. 2d (1976), 528 F. (2d)

1130, 1133-1134 [4], certiorari denied (1976), 425 U. S. 972, 96

S. Ct. 2169, 48 L. Ed. (2d) 795.

Mr. Ellis contended inter alia (1) that the money he received

from Mr. Pomporini was in repayment of a personal loan and

did not represent union-money; (2) that the union disbursement

of funds to pay for a long distance telephone call, concerned

with his surrogate operation of a union vehicle, was authorized;

and (3) that its payment for other telephone calls made for him

by Messrs. Akin and Hickman were either (a) authorized by the

union or (b) in excess of the permission granted those persons

by Mr. Ellis. He contended also that, equitably, he was entitled

to a setoff against the foregoing tolls, by the amount he had

paid personally for tolls on union business from his private

telephone.

In this somewhat hybrid situation, implicating as it does both

authorized and unauthorized calls, this Court may or may not

have been correct in instructing the jury that it was an essential

element of the § 501 (c) crime for the jury to find that Mr. Ellis

‘** * * did not have a good-faith belief that the particular ex-

penditure was for the legitimate benefit of the union.”’ If incor-

— A-23 —

rect, this worked in Mr. Ellis’ favor, however; because it re-

quired the prosecution to have proved an extra element of his

guilt. Cf. United States v. Bune, supra, 583 F. (2d) at 835, n. 7.

There was no error in the Court’s proceeding to entertain a

certain tape recording made by an electronic device, which was

represented to include thereon voices in a conversation, until it

appeared that the prosecution was unable to establish the chain

of the pretrial custody of the tape. ‘‘* * * [T]he most reliable

evidence possible of a conversation * * *”’ is that provided by

an electronic device. Lopez v. United States (1963), 373 U. S.

427, 439, 83 S. Ct. 1381, 10 L. Ed. (2d) 462, 470 (headnote 7).

The proposed exhibit could not be received in evidence, because

its chain of custody could not be established sufficiently to lay a

foundation for its admission. Cf. United States v. Robinson, D.

C. Tenn. (1977), 367 F. Supp. 1108, 1109-1110 [2].

This Court is unadvised how it might have handled the pros-

pect of this evidence differently or better.

The assertion of Mr. Ellis that the assistant United States at-

torney, prosecuting this action, may have gained the sympathy

of the jurors ‘‘* * * as the victim of objections and admonish-

tions [sic: admonitions] * * *’’ lacks merit. This, he contends,

sprang from the repeated failure of such attorney to deliver

material to defense counsel at the times required by the Court,

resulting in repeated objections by defense counsel and, conse-

quently, repeated admonishments from the Court.

The Court instructed the jury, inter alia:

You are to perform your duty without bias or prejudice

to anyone. The law does not permit you to be governed by

sympathy * * *; rather, it is expected that you will con-

sider carefully and impartially all the evidence, follow the

law as stated to you at this time by the Court, and arrive at

—

the verdict on each remaining count of the indictment

which you think is just, fair and right under all the proof.

ees eee ©

*** TYjou must consider nothing but legal evidence

presented before you in support of the charges against Mr.

Ellis.

*seseeee &

Remember, it is the duty of lawyers to object * * *.

see eee ee ©

Remember always, please, that you are not partisans.

You are not for or against the government; you are not for

or against Mr. Ellis. You are judges, judges of the facts.

Your sole interest is to ascertain the truth of this matter

from the evidence presented before you.

ese ee ee &

* * * [K]eep constantly in mind that it would be a viola-

tion of your sworn duty to base your verdicts on anything

but the evidence and the law in this particular case.

It isn’t ever a question of whether our government wins

or loses a case; because, our government always wins when

justice is done,—regardless of whether the verdict of the

jury is guilty or not guilty.

e**e# ee ee &

Nothing occurring during the trial, even so trivial a

thing as a facial expression or a voice inflection, or

anything else which occurred, is to suggest to you any in-

timation of what the Court thinks your verdicts should be.

*ese eee &

— A-25 —

Absent anything to rebut it (save the conclusion of Mr. Ellis),

“*** it must be presumed that the jury conscientiously

observed * * *’’ these instructions of the Court. Shotwell Mfg.

Co. v. United States (1963), 371 U. S. 341, 367, 83 S. Ct. 448, 9

L. Ed. (2d) 357, 375 (headnote 22).

Thus, there was no plain error, and if this Court committed

any error in the trial of Mr. Ellis, it did not affect his substantial

right and is to be disregarded, Rule 52, supra. For such reason

the interest of justice does not require that a new trial be

granted. Rule 33, supra. His motion for a new trial, therefore,

hereby is

DENIED.

ENTER:

(C. G. Neese)

United States District Judge

by designation

=.

APPENDIX B

NO. 79-5098

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

United States of America,

Plaintiff-Appellee,

Vs.

William L. Ellis,

Defendant-Appellant.

ORDER

(Filed March 24; 1980)

BEFORE: WEICK, LIVELY AND JONES, Circuit Judges.

The Defendant appeals from his conviction of six counts of

conspiracy and mail fraud, 18 U.S.C. §371, 1341, and 1342 and

on five counts of conversion to his own use of money or prop-

erty of a labor organization. We affirm.

The question posed by this appeal is whether there was

substantial evidence to support these convictions. Substantial

evidence is ‘‘such relevant evidence as a reasonable mind might

accept as adequate to support a conclusion.’’ United States v.

Conti, 339 F.2d 10, 13 (6th Cir. 1964).

The Defendant was charged with one count of conspiracy (to

defraud by use of the U.S. Postal Service) and five substantive

counts of mail fraud in connection with solicitation of money

for advertisements for the ‘‘Tennessee Labor Journal.’’ The

standard of proof necessary to sustain a conviction for mail

fraud was set forth in this Circuit’s opinion in United States v.

Talbott, 590 F.2d 192, 195 (1978):

on AedT —

““Where one does an act with knowledge that the use of

the mails will follow in the ordinary course of business, or

where such use can reasonably be foreseen, even though

not actually intended, then he ‘causes’ the mails to be

used.’’ Pereira v. United States, supra, 347 U.S. at 8-9, 74

S. Ct. at 363.

A use of the mails which ‘‘is not.a step toward receipt of

the fruits of the scheme is not covered by Section 1341.’’

United States v. Staszcuk, 502 F.2d 875; 880 (7th Cir.

1974) modified 517 F.2d 53, cert. den. 423 U.S. 837, 96S.

Ct. 65, 46 L.Ed. 2d 56 (1975). However, a conviction is

warranted if use of the mails was foreseeable. United

States v. Hasentab, 575 F.2d 1035 (2nd Cir. 1978) (em-

phasis added).

The Defendant contends that a conspiracy to violate the mail

fraud statute cannot be proved unless it is shown that the con-

spirators intended or contemplated that the mail would be used

to carry out the scheme. The government argues that a convic-

tion for conspiracy to commit mail fraud can be sustained if it is

shown participants who are not aware of mailings are never-

theless responsible for the mailings which are caused by other

members of the scheme in its furtherance. Culpability for con-

spiring to commit an illegal act requires only that one agree with

others to commit acts which constitute the substantive offense.

United States v. Craig, 573 F.2d 455, 485 (7th Cir. 1977). There

is substantial evidence to support the conviction on the con-

spiracy charge based on this standard.

Counts one through six of the Indictment alleged that the

Defendant’s involvement with Lewellen and the ‘‘Labor Jour-

nal are unlawful. The Defendant argues that the government

proved two business schemes: Stamps’ ‘‘Labor News’’ scheme

without proof that it either used or contemplated use of the

mails, and Lewellen’s ‘‘Labor Journal’’ scheme as to which it

failed to prove that Ellis was a party.

=

This view of the interrelationship of the alleged activities is

simplistic. Essentially, Stamps’ ‘‘Labor News”’ is the

predecessor to Lewellen’s ‘‘Labor Journal.’’ The evidence of

the Defendant’s involvement establishing Stamps’ ‘Labor

News” found by the District Court to be sufficient for a jury

verdict on mail fraud is based upon the testimony of his

coconspirator and other evidence admitted at trial as to this

scheme. There is substantial evidence to support the District

Court’s finding that the establishment of these journals con-

stitute one scheme.

The fourteenth count of the indictment alleges that the

Defendant converted to his own use $1,000.00 due the Union on

its contract with D&P Associate, Inc., in violation of 29 U.S.C.

§501(a). On behalf of the Union, the Defendant contracted with

D & P Associates, Inc. whereby D&P would publish three an-

nual editions of the Tennessee Teamsters’ Yearbook and the

Union would be paid a minimum of $1,000.00/year from the

proceeds. The Union Executive Board approved the contract.

None of the cash consideration was ever paid to the Union. Mr.

Pomporini, (representing D & P Associates) paid the Defendant

$500.00 on two occasions (the Defendant testified the money

was in repayment of a personal loan).

Although the foregoing evidence is circumstantial, a jury,

discrediting the Defendant’s testimony, could reasonably infer

the two $500.00 payments, an amount equal to the money due

the Union, and paid in close proximity to each other, was

money due to the Union. In addition, the contract between the

Union and D & P Associates lacked the signature and concur-

rence of the Union’s Secretary-Treasurer.

The last two counts concern the abuse of Defendant’s union

position for personal gain. There was extensive testimony and

evidence introduced as to abuse of the Union’s telephone and

telephone credit cards for Defendant’s personal benefit. The

evidence was indirect, but it was sufficient to sustain this convic-

— A-29 —

tion unless the jury gave full weight to testimony excuplating the

Defendant. A rational Jury could find beyond a reasonable

doubt that Defendant’s innocent explanation was false.

The court has considered the Defendant’s other arguments

and finds them without merit.

Accordingly, the Judgment of the District Court is affirmed.

ENTERED BY ORDER OF THE COURT

John P. Hehman

Clerk

—s vo

APPENDIX C

NO. 79-5098

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

United States of America,

Plaintiff-Appellee,

V.

William L. ‘‘Corky’’ Ellis,

Defendant-Appellant.

ORDER

(Filed May 23, 1980)

BEFORE: WEICK, LIVELY AND JONES, Circuit Jones

The petition for rehearing is denied.

ENTERED BY ORDER OF THE COURT

John P. Hehman

Clerk

—

APPENDIX D

STATUTES

18 U.S.C, § 371:

If two or more persons conspire either to commit any offense

against the United States, or to defraud the United States, or

any agency thereof in any manner or for any purpose, and one

or more of such persons do any act to effect the object of the

conspiracy, each shall be fined not more than $10,000 or im-

prisonment not more than five years, or both.

If, however, the offense, the commission of which is the ob-

ject of the conspiracy, is a misdemeanor only, the punishment

for such conspiracy shall not exceed the maximum punishment

provided for such misdemeanor.

18 U.S.C. § 1341:

Whoever, having devised or intending to devise any scheme

or artifice to defraud, or for obtaining money or property by

means of false or fraudulent pretenses, representations, or pro-

mises, or to sell, dispose of, loan, exchange, alter, give away,

distribute, supply, or furnish or procure for unlawful use any

counterfeit or spurious coin, obligation, security, or other arti-

cle, or anything represented to be or intimated or held out to be

such counterfeit or spurious article, for the purpose of ex-

ecuting such scheme or artifice or attempting so to do, places in

any post office or authorized depository for mail matter, any

matter or thing whatever to be sent or delivered by the Postal

Service, or takes or receives therefrom, any such matter or

thing, or knowingly causes to be delivered by mail according to

the direction thereon, or at the place at which it is directed to be

delivered by the person to whom it is addressed, any such matter

or thing, shall be fined not more than $1,000 or imprisoned not

more than five years, or both.

— A-32 —

29 U.S.C. § 431:

(a) Every labor organization shall adopt a constitution and

by-laws and shall file a copy thereof with the Secretary, together

with a report, signed by its president and secretary or corres-

ponding principal officers, containing the following informa-

tion—

(1) the name of the labor organization, its mailing ad-

dress, and any other address at which it maintains its prin-

cipal office or at which it keeps the records referred to in

this subchapter;

(2) the name and title of each of its officers;

(3) the initiation fee or fees required from a new or

transferred member and fees for work permits required by

the reporting labor organization;

(4) the regular dues or fees or other periodic payments

required to remain a member of the reporting labor

organization; and

(5) detailed statements, or references to specific pro-

visions of documents filed under this subsection which

contain such statements, showing the provision made and

procedures followed with respect to each of the following:

(A) qualifications for or restrictions on membership, (B)

levying of assessments, (C) participation in insurance or

other plans, (D) authorization for disbursement of funds

of the labor organization, (E) audit of financial trans-

actions of the labor organization, (F) the calling of regular

and special meetings, (G) the selection of officers and

stewards and of any representatives to other bodies com-

posed of labor organizations’ representatives, with a

specific statement of the manner in which each officer was

elected, appointed, or otherwise selected, (H) discipline or

removal of officers or agents for breaches of their trust, (I)

imposition of fines, suspensions, and expulsions of mem-

— A-33 —

bers, including the grounds for such action and any pro-

vision made for notice, hearing, judgment on the evidence,

and appeal procedures, (J) authorization for bargaining

demands, (K) ratification of contract terms, (L) authoriza-

tion for strikes, and (M) issuance of work permits. Any

change in the information required by this subsection shall

be reported to the Secretary at the time the reporting labor

organization files with the Secretary the annual financial

report required by subsection (b) of this section.

(b) Every labor organization shall file annually with the

Secretary a financial report signed by its president and treasurer

or corresponding principal officers containing the following in-

formation in such detail as may be necessary accurately to

disclose its financial condition and operations for its preceding

fiscal year—

(1) assets and liabilities at the beginning and end of the

fiscal year;

(2) receipts of any kind and the sources thereof;

(3) salary, allowances, and other direct or indirect dis-

bursements (including reimbursed expenses) to each officer

and also to each employee who, during such fiscal year, re-

ceived more than $10,000 in the aggregate from such labor

organization and any other labor organization affiliated

with it or with which it is affiliated, or which is affiliated

with the same national or international labor organization;

(4) direct and indirect loans made to any officer, em-

ployee, or member, which aggregated more than $250 dur-

ing the fiscal year, together with a statement of the pur-

pose, security, if any, and arrangements for repayment;

(5) direct and indirect loans to any business enterprise,

together with a statement of the purpose, security, if any,

and arrangements for repayment; and

on 4

(6) other disbursements made by it including the pur-

poses thereof;

all in such categories as the Secretary may prescribe.

(c) Every labor organization required to submit a report

under this subchapter shall make available the information re-

quired to be contained in such report to all of its members, and

every such labor organization and its officers shall be under a

duty enforceable at the suit of any member of such organization

in any State court of competent jurisdiction or in the district

court of the United States for the district in which such labor

organization maintains its principal office, to permit such

member for just cause to examine any books, records, and ac-

counts necessary to verify such report. The court in such action

may, in its discretion, in addition to any judgment awarded to

the plaintiff or plaintiffs, allow a reasonable attorney’s fee to be

paid by the defendant, and costs of the action.

29 U.S.C. § 439:

er

(b) Any person who makes a false statement or representation

of a material fact, knowing it to be false, or who knowingly fails

to disclose a material fact, in any document, report, or other in-

formation required under the provisions of this subchapter shall

be fined not more than $10,000 or imprisoned for not more than

one year, or both.

29 U.S.C. § 501:

(a) The officers, agents, shop stewards, and other represen-

tatives of a labor organization occupy positions of trust in rela-

tion to such organization and its members as a group. It is,

therefore, the duty of each such person, taking into account the

special problems and functions of a labor organization, to hold

— A-35 —

its money and property solely for the benefit of the organization

and its members and to manage, invest, and expend the same in

accordance with its constitution and bylaws and any resolutions

of the governing bodies adopted thereunder, to refrain from

dealing with such organization as an adverse party or in behalf

of an adverse party in any matter connected with his duties and

from holding or acquiring any pecuniary or personal interest

which conflicts with the interests of such organization, and to

account to the organization for any profit received by him in

whatever capacity in connection with transactions conducted by

him or under his direction on behalf of the organization. A

general exculpatory provision in the constitution and bylaws of

such a labor organization or a general exculpatory resolution of

a governing body purporting to relieve any such person of

liability for breach of the duties declared by this section shall be

void as against public policy.

(b) When any officer, agent, shop steward, or representative

of any labor organization is alleged to have violated the duties

declared in subsection (a) of this section and the labor organiza-

tion or its governing board or officers refuse or fail to sue or

recover damages or secure an accounting or other appropriate

relief within a reasonable time after being requested to do so by

any member of the labor organization, such member may sue

such officer, agent, shop steward, or representative in any

district court of the United States or in any State court of com-

petent jurisdiction to recover damages or secure an accounting

or other appropriate relief for the benefit of the labor organiza-

tion. No such proceeding shall be brought except upon leave of

the court obtained upon verified application and for good cause

shown, which application may be made ex parte. The trial judge

may allot a reasonable part of the recovery in any action under

this subsection to pay the fees of counsel prosecuting the suit at

the instance of the member of the labor organization and to

compensate such member for any expenses necessarily paid or

incurred by him in connection with the litigation.

— A-36 —

(c) Any person who embezzles, steals, or unlawfully and

willfully abstracts or converts to his own use, or the use of

another, any of the moneys, funds, securities, property, or

other assets of a labor organization of which he is an officer, or

by which he is employed, directly or indirectly, shall be fined

not more than $10,000 or imprisoned for not more than five

years, or both.