Petition — Yellow Freight System, Inc. v. United States

Supreme Court brief1981

Ask Donna

What actually matters in this document.

Text

80-1759 | Flees”

No.

ER L. STEVAS,

CLERK

In the Supreme Court of the United- States —

October Term, 1980

YELLOW FREIGHT SYSTEM, INC.,

Petitioner,

vs.

UNITED STATES OF AMERICA,

Respondent.

* * * * +

DUNCAN CERAMICS, INC.,

Petitioner,

vs.

UNITED STATES OF AMERICA,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

ROBERT POPPER

(Counsel of Record)

School of Law

University of Missouri-Kansas City

5100 Rockhill Road

Kansas City, Missouri 64110

(816) 276-1651

RonaALD E, SANDHAUS

Attorneys for Petitioners

Of Counsel:

Rosert G. CARTER

Trevor C. CLEGG

Dean A, BAILEY

——

E. L. Menwpexnatt, Inc., 926 Cherry Street, Kansas City, Mo. 64106, (816) 421-3030

QUESTIONS PRESENTED

1. Do the Constitution and laws of the United States

and the Federal Rules of Criminal Procedure permit an

accused corporation tu be tried for fifty crimes, each pun-

ishable by a maximum of two years in prison and a fine

of $20,000, without any pretrial determination by a neutral

fact finder that probable cause exists to believe that

the crimes were committed and that the accused committed

them?

2. Can a corporation charged with a felony under

the laws of the United States be deprived of the right

to indictment safeguarded by the Fifth Amendment to

the United States Constitution?

3. When the crime charged is a federal felony, and

no indictment has been returned, are the Federal Rules

of Criminal Procedure, laws of the United States or Due

Process of Law under the Fifth Amendment violated by

permitting the defendant to be tried without any prior

judicial determination that there exists sufficient evidence

to warrant a belief that the defendant committed the al-

leged felony?

4. Should this Court exercise its supervisory power

over the lower federal courts so as to require a finding

that there is probable cause to believe the defendant com-

mitted th: crime charged, such finding to be made either

by a grand jury, magistrate, or judge before the defendant

is subjected to a trial for a felony offense.*

*The caption of the case in this Court lists all parties to the

proceeding. Neither of the petitioners has a parent company, and

neither has a subsidiary that is not wholly owned.

TABLE OF CONTENTS

Questions Presented

Table of Authorities

Opinions Below

Jurisdiction

Constitutional Provisions, Statutes and Court Rules In-

volved

Statement of the Case

Reasons for Granting the Writ—

I. The Decision Below Resolves Important Ques-

tions Of Federal Constitutional Law In A Way

That Conflicts With Applicable Decisions Of This

Court And Other Courts Of Appeals And Which

Sanctions A Departure From Prevailing Judicial

Procedure That Creates A Dangerous Threat

To The Fair Administration Of Justice In The

Federal Courts

A. Importance of the Question

B. Conflict With Applicable Precedent ............

i. The meaning of “infamous crime” and

the corporate defendant

ii. In the absence of an indictment a judicial

determination of probable cause prior to

trial was required ;

a. Due Process of Law

b. The Federal Rules of Criminal Pro-

cedure

C. The Court of Appeals Decision Sanctions a

Procedure Which So Far Departs From the

we bw <

co we

Accepted and Usual Course of Judicial Pro-

ceedings That It Calls for an Exercise of

This Court’s Power of Supervision ................ 26

Conclusion 29

Appendix A

Opinion of the United States Court of Appeals for

the Ninth Circuit A2

Order of the United States Court of Appeals for

the Ninth Circuit Al3

Appendix B

Memorandum and Order of the United States Dis-

trict Court, Eastern District of California

(United States v. Yellow Freight System, Inc.) A15

Memorandum and Order of the United States Dis-

trict Court, Eastern District of California

(United States v. Duncan Ceramics, Inc.) ............ Al6

Appendix C

Constitutional Provisions, Statutes and Court

Rules Al8

Fifth Amendment, United States Constitution ........ Al8

1 U.S.C. §1 Al8

18 U.S.C. §1 Al8

18 U.S.C. §3060 Al19

49 U.S.C. §11903 A21

Federal Rules of Criminal Procedure:

5(c) A21

7(a) A22

Table of Authorities

CASES

Albrecht v. United States, 273 U.S. 1 (1927) ...........-.s000 22

Application of Jordan, 439 F. Supp. 199 (D. W.Va.

1971) 8

Argersinger v. Hamlin, 407 U.S. 25 (1972) -....-.--.-r00--0+0+ 13

Austin v. United States, 408 F.2d 808 (9th Cir. 1969) 27

Baldasar v. Illinois, 100 S.Ct. 1585 (1980) ..................-. 13

Baldwin v. New York, 399 U.S. 66 (1970) ..........-..-2-0++ 13, 16

Beavers v. Henkel, 194 U.S. 73 (1904) 7

Bell v. Burson, 402 U.S. 535 (1971) 21

Bellis v. United States, 417 U.S. 85 (1974) 2.0.0.2... 16

Board of Regents v. Roth, 408 U.S. 564 (1972) ............ 21

Beddie v. Connecticut, 401 U.S. 371 (1971) 20... 21

Brinegar v. United States, 338 U.S. 160 (1949) ............ 27-28

Coleman v. Alabama, 399 U.S. 1 (1970) 24, 25

Coolidge v. New Hampshire, 403 U.S. 443 (1970) ........ 27

Costello v. United States, 350 U.S. 359 (1956) ..............-. 7,12

Couch v. United States, 409 U.S. 322 (1973) .................. 16

Curcio v. United States, 354 U.S. 118 (1957) ................ 16

Duncan v. Louisiana, 391 U.S. 145 (1968) .................... 13

Ex parte Bain, 121 U.S. 1 (1887) 7

Ex parte Wilson, 114 U.S. 417 (1885) 9

Fallen v, United States, 378 U.S. 139 (1964) 2.2.2.2... 26

First National Bank of Boston v. Bellotti, 435 U.S. 765

(1978) 13, 16

Fitzpatrick v, United States, 178 U.S. 304 (1900) ........ 9,11

Fong Foo v. United States, 369 U.S. 141 (1962) ............ 14

Fuentes v. Shevin, 401 U.S. 67 (1972) 21

Gagnon v, Scarpelli, 411 U.S. 778 (1973) 21, 23

Gerstein v. Pugh, 420 U.S. 103 (1975) ................ 7, 18, 22, 27

Gideon v. Wainwright, 372 U.S. 335 (1963) ......-..--....-+- 13

Giordenello v. United States, 357 U.S. 480 (1958) .... 26

G.M. Leasing Corp. v. United States, 429 U.S. 338

(1977) 15

Goldberg v. Kelly, 397 U.S. 254 (1970) 21

Goss v. Lopez, 419 U.S. 565 (1975) 21

Grosjean v. American Press Co., 297 U.S. 233 (1936) 16

Harvin v. United States, 445 F.2d 675 (D.C. Cir. en

banc 1971), cert. denied, 404 U.S. 943 (1971) ............ 11

Hawkins v. Superior Court of San Francisco, 150 Cal.

~ Rptr. 435, 586 P.2d 916, 22 Cal. 3d 584 (1978) ............ 25

In re Claasen, 140 U.S. 200 (1891) 9

Jaben v. United States, 381 U.S. 214 (1965) ................ 24

Johnson v. United States, 333 U.S. 10 (1948) ................ 27

Jones v. Robbins, 8 Gray 329 (S. Jud. Ct. Mass. 1857) 18

Louis K. Liggett Co. v. Baldridge, 278 U.S. 105 (1928) 16

Mackin v. United States, 117 U.S. 348 (1886) ................ 9,11

Marshall v. Barlow’s, Inc., 98 S.Ct. 1816 (1978) ........ 15

Mathews v. Eldridge, 424 U.S. 319 (1976) 23, 24

Mempa v. Rhay, 389 U.S. 128 (1967) 13

Memphis Light, Gas & Water Division v. Craft, 436

U.S. 1 (1978) 21, 23

Michel v. Louisiana, 350 U.S. 91 (1955) 11

Morrissey v. Brewer, 408 U.S. 471 (1972) 21

North Georgia Finishing, Inc. v. DiChem, Inc., 419 U.S.

601 (1975) 21

Paul v. Davis, 424 U.S. 693 (1976) 22

Pennsylvania Bank & Trust Co. v. Hamisek, 426 F, Supp.

410 (W.D. Pa. 1977) 16

People v. Elliot, 54 Cal. 2d 498, 354 P.2d 225, 6 Cal.

” Rptr. 753 (1960) 24

vit

Perry v. Sindermann, 408 U.S. 593 (1972) .............-.0-+-- 22

Ross.v. Bernhard, 396 U.S. 531 (1970) 16

Safeguard Mutual Insurance Co. v. Miller, 472 F.2d 732

(3rd Cir. 1973) 16

Sciortino v. Zampano, 385 F.2d 132 (2nd Cir. 1967),

cert. denied, 390 U.S. 906 (1968) 27

Shadwick v. City of Tampa, 407 U.S. 345 (1971) ........ 27

Smith v. United States, 360 U.S. 1 (1959) .................... 12

Sniadach v. Family Finance Corp., 395 U.S. 337 (1969) 21

Stirone v. United States, 361 U.S. 212 (1960) ............ 8,11

United States v. Armco Steel Corp., 252 F. Supp. 364

(S.D. Cal. 1966) 14

United States v. Armored Transport, Inc., 629 F.2d 1313

(9th Cir. October 7, 1980), certiorari denied, ........

Th sindions , 49 U.S.L.W. 3643 (March 2, 1981) ............ 5

United States v. American Honda Motor Co., 271 F.

Supp. 979 (N.D. Cal. 1967) 14

United States v. American Honda Motor Co., 273 F.

Supp. 810 (N.D. Ill. 1967) 14

United States v. Calandra, 414 U.S. 338 (1974) ............ 8

United States v. Greenberg, 320 F.2d 467 (9th Cir. 1963)

19, 27, 28

United States v. Hospital Monteflores, Inc., 575 F.2d

332 (1st Cir. 1978) 14,15

United States v. Johnson, 585 F.2d 374 (8th Cir. 1978),

cert, denied, 99 S.Ct. 1246 (1979) 12

United States v. Kahl, 583 F.2d 1351 (5th Cir. 1978) ... 12

United States v. Kennedy, 5 F.R.D. 310 (D. Colo. 1946) 27

United States v. Macklin, 389 F. Supp. 272 (E.D. N.Y.

_ 1915), aff'd on other grounds, 523 F.2d 193 (2d Cir.

' 1975) 11

United States v. Mandujuano, 425 U.S. 564 (1976) ....7,12

viir

United States v. Martin Linen Supply Co., 430 U.S. 564

(1977) 14

United States v. Millican, 600 F.2d 273 (5th Cir. 1979)

. é | 12, 19, 26, 27, 28

United States v. Moreland, 258 U.S. 433 (1922) ............ 9, 10

United States v. Morgan, 222 U.S. 274 (1911) ................ 27

United States v. Neve, 492 F.2d 465 (7th Cir. 1974) .... 11

United States v. Owens-Corning Fiberglas Corporation,

271 F. Supp. 561 (N.D. Cal. 1967) 12

United States v. R.L. Polk and Co., 438 F.2d 377 (6th

Cir. 1971) 16

United States v. Security National Bank, 546 F.2d 492

(2d Cir. 1976) 14

United States v. Southern Ry., 485 F.2d 309 (4th Cir.

- 1973) 14

United States v. Wells, 163 Fed. 313 (D. Idaho 1908) ..... 7

United States v. White, 322 U.S. 694 (1944) ................ 16

United States v. Yates, 6 Fed. 861 (E.D. N.Y. 1881) .... 11

United States ex rel. Wheeler v. Flood, 269 F. Supp.

194 (S.D. N.Y. 1961) 25

Vitek v. Jones, 445 U.S, 480 (1980) 19

Wisconsin v. Constantineau, 400 U.S. 433 (1971) ........ 21, 22

STATUTES AND RULES

1 U.S.C. §1 2, 3, 4, 6, 12

18 U.S.C. §3006A(b) 13

Section 3060(e) of Title 18, United States Code ........ 2, 19, 26

18 U.S.C. §5005, et seq. 10

28 U.S.C. §1254(1) 2

49 U.S.C. §11903 2, 3, 4,6

Pub; L. No. 95-473, 92 Stat. 1337 3

United States Constitution, Fourth Amendment .......... 15, 18

United States Constitution, Fifth Amendment ....2, 12, 13, 15

United States Constitution, Sixth Amendment ................ 15

United States Constitution, Seventh Amendment ......... 16

A.B.A. Ernica, Sranparps, Discreptinary Rute 7-103

(1969) 19

A.B.A, STANDARDS FOR CRIMINAL JUSTICE RELATING TO

THE PROSECUTION FUNCTION §3.9 (1971) 19

Federal Rules of Criminal Procedure, Rule 5(c) ....2, 19, 24

Federal Rules of Criminal Procedure, Rule 7 ................ 2,12

Federal Rules of Criminal Procedure, Rule 9(a) ........ 6

Supreme Court Rule 20.1 2

OTHER AUTHORITIES

Alexander and Portman, Grand Jury Indictment Versus

Prosecution by Information - An Equal Protection -

Due Process Issue, 25 Hastings L.J. 997, 1003 (1974) 23

Charge to Grand Jury, 30 F. Cas. 992 (No. 18,255)

(C.C.D. Cal. 1872), 2 Sawy. 667 7,11

Comment, Preliminary Examination - Evidence and

Due Process, 15 U. of Kan. L. Rev. 374, 376, 380

(1967) 23

28 Criminal Law Reporter 2048, Oct. 8, 1980 ................ 8

Developments in the Law - Corporate Crime: Regu-

lating Corporate Behavior Through Criminal Sanc-

tions, 92 Harv. L. Rev. 1227, 1344 (1979) ................ 15, 20

Graham and Letwin, The Preliminary Hearing in Los

Angeles: Some Field Findings and Legal Policy Ob-

servations, 18 U.C.L.A. L. Rev. 635 (1971) ................ 25

La Fave and Scott, Criminal Law, pp. 29-31 (1972) .... 17

Materials Relating to Prosecutorial Discretion, 24 Crim.

L. Rep. (BNA) 3001, 3002 (1978) 20

NATIONAL ADvISORY COMMISSION ON CRIMINAL JUSTICE

STANDARDS AND GOALS, Courts §1.] (1973) .............. a ae

Note, A Constitutional Right to Preliminary Hearings

for All Pretrial Detainees, 48 So. Calif. L. Rev. 158,

179-183 (1974) 24

Note, The Distinction Between Mala Prohibita and

Mala in Se in Criminal Law, 30 Col. L. Rev. 74

(1930) 17

Note, The Function of the Preliminary Hearing in Fed-

eral Pretrial Procedure, 83 Yale L.J. 771, 783-787

(1974) 23-24

Note, The Preliminary Hearing - An Interest Analysis,

51 Ia. L. Rev. 164, 173-174 (1965) 23

Orland, Reflections on Corporate Crime: Law in

Search of Theory and Scholarship, 17 American

Criminal Law Review 501 (1980) 8

8 WicMmorE, EvIDENCE, §2259(a) (McNaughton rev.

1961) 16

No.

In the Supreme Court of the United States

October Term, 1980

e YELLOW FREIGHT SYSTEM, INC.,

Petitioner,

vs.

UNITED STATES OF AMERICA,

Respondent.

DUNCAN CERAMICS, INC.,

Petitioner,

vs.

UNITED STATES OF AMERICA,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

The petitioners Yellow Freight System, Inc. and Dun-

can Ceramics, Inc. respectfully pray that a writ of certiorari

issue to review the judgment and opinion of the United

States Court of Appeals for the Ninth Circuit entered

in this proceeding on February 20, 1981.

OPINIONS BELOW

The opinion of the Court of Appeals for the Ninth

Circuit was filed October 17, 1980, and in part dismissed

‘the appeal and in part affirmed the District Court’s (East-

ern District of California) August 28, 1979 denial of the

relief requested by the petitioners. On February 20, 1981

the Court of Appeals amended its opinion of October 17,

1920 and denied the petition and suggestion for a rehearing

in banc.

The opinion of the Court of Appeals is reported at

637 F.2d 1248. The memoranda and orders of the District

Court have not been reported. The opinion, memoranda

and orders referred to are reproduced in the Appendices

to this petition. Appendix A contains the Court of Appeals’

opinion and order. Appendix B contains the District

Court’s memoranda and orders.

JURISDICTION

The judgment of the Court of Appeals for the Ninth

Circuit was entered on October 17, 1980. A timely petition

for rehearing in banc was denied on February 20, 1981,

and this petition for certiorari was filed within sixty days

of that date in accordance with Rule 20.1 of the Rules of

this Court. The jurisdiction of this Court is invoked under

28 U.S.C, §1254(1).

CONSTITUTIONAL PROVISIONS, STATUTES

AND COURT RULES INVOLVED

The Fifth Amendment to the United States Constitu-

tion; 1 US.C. §1; 18 US.C. §§1, 3060(e); 49 U.S.C.

§11903; Federal Rules of Criminal Procedure, Rules 5(c)

and 7 have been set forth below in Appendix C.

STATEMENT OF THE CASE

The facts material to the consideration of the questions

presented are not in dispute. A summons was served and

filed and a fifty-count felony information was filed against

each petitioner in the United States District Court for

the Eastern District of California. The government has

expressed its intent to proceed to trial without adhering

to any further procedural requirements. No preliminary

hearing has been held and no judicial finding has been

made determining that there is probable cause to believe

that an offense has been committed and that the petitioners

committed it. No indictment has been returned against

either petitioner. In fact, in the District Court the peti-

tioners asserted upon information and belief that no good

faith conscientious decision was ever made by any proper

authority that probable cause existed to initiate the prose-

cution. R, 32-331 The petitioners were denied the op-

portunity of a hearing in the District Court on this allega-

tion.

The petitioner Yellow Freight System, Inc. (“Yel-

low”), a corporation engaged in business as a motor carrier,

is charged with violating a part of the Interstate Commerce

Act known as the Elkins Act. 49 U.S.C. §11903(a) (for-

merly 49 U.S.C. §41(1)).? The information alleges that

1. Citations to the record refer to the Excerpts of Record

filed by Yellow Freight System, Inc., in the Court of Appeals.

2. 49 U.S.C. §11903, a recodification of the prior law, is

set forth in Appendix C to this petition. It was enacted subse-

quent to the filing of the charges in this case [Act of October

17, 1978, Pub. L. No. 95-473, 92 Stat. 1337] but is controlling.

Se ion 3 of Pub. L. 95-473 specifically provides that the re-

codification “may not be construed as making a substantive change

in the laws, replaced, and that:

“(d) An action taken or an o ee ae ee

eae tha fg nerd Sor podbean ee

been or commi under corresponding provision

enacted by this Act.”

Yellow “knowingly” gave concessions to Duncan Ceramics,

Inc, (“Duncan”) with the result that property was trans-

ported in interstate commerce “at a less rate than that

named in the tariffs published and filed with the Interstate

Commerce Commission.” R. 2-5. A similar information

was filed against the petitioner Duncan charging Duncan

with violating the same statutory provision by “knowingly”

accepting the concessions.

In each information, fifty instances of misconduct are

alleged, each in a separate count, each count alleging a

felony punishable by two years’ imprisonment, or a fine

of not less than $1,000 nor more than $20,000, or both.

49 U.S.C. §11903 (a); 18 U.S.C. §1(1).

_ The petitioners moved before trial to dismiss the in-

formation. k. 7-86. The motions were denied by the district

judge. See App. B below. A panel of the United States

Court of Appeals for the Ninth Circuit, in part, approved

the District Court and, in part, dismissed the appeal. A

petition for rehearing in banc was denied. See App. A;

637 F.2d 1248.

The judgment of the Court of Appeals can be sum-

marized briefly. It contained three parts, only two of

which are relevant to the present petition. First, the

court held that the petitioners’ due process claim—that

in the absence of an indictment they were entitled to

a judicial determination of probable cause—did not involve

an “important right that would be lost if we refuse im-

mediate review.” In effect, the court held that the peti-

tioners asserted “nv interest cognizable under the due pro-

3. The third part pertained to petitioners’ contention that

the statute selected by the government as the basis for the prose-

cution was inapplicable to motor carriers. The Court of Appeals

held that this point is not an appropriate one for pre-trial review.

Petitioners do not seek review of this portion of the Cow of

Appeals’ decision.

cess clause,” and that “the district court’s denial of this

claim is not immediately applicable.”

Second, the Court of Appeals held that whether a

crime is infamous for the purpose of triggering the Fifth

Amendment’s right to be tried on a grand jury’s indictment

is not governed solely by the possibility of imprisonment

in a penitentiary for over one year. Not only the offense

but the offender, too, must be considered. Since the pe-

titioners are corporations and can not be imprisoned, the

court looked to other indicia and found that at least in this

case, where the accuseds are not individuals, the crimes

charged must be deemed non-infamous.

REASONS FOR GRANTING THE WRIT

1. The Decision Below Resolves Important Ques-

tions Of Federal Constitutional Law In A Way That

Conflicts With Applicable Decisions Of This Court And

Other Courts Of Appeals And Which Sanctions A De-

parture From Prevailing Judicial Procedure That

Creates A Dangerous Threat To The Fair Administra-

tion Of Justice In The Federal Courts.

A. Importance of the Question

In a decision that is literally unprecedented by any

other federal appellate court,‘ the Court of Appeals for

the Ninth Circuit has endorsed a criminal process which

enables a defendant to be subjected to a lengthy trial

4. Only one other case supports the result below, and that

is a decision by the same Court of Appeals rendered ten days

before the judgment in the instant case. United States v. Ar-

mored vl daelod Inc., 629 yan (9th Cir. October 7, 1980),

certiorert dene Be US, .., 49 U.S.L.W. 3643 (March 2,

‘on serious criminal charges solely on the decision or whim,

of the prosecutor.

Each petitioner has been charged by an information

alleging fifty instances of misconduct, and it is apparently

the government’s position that each instance is a violation

of the Elkins Act. 49 U.S.C. §11903(a). The conduct

proscribed by the statute is made a felony punishable

by two years’ imprisonment, or a fine of not less than

$1,000 nor more than $20,000, or both, so that under the

government’s theory each petitioner .tands charged with

fifty felonies. 18 U.S.C. §1(1). The potential aggregate

sentence authorized by Congress, according to the govern-

ment’s approach, is a $1 million fine for each petitioner,

and had the accuseds been non-corporate individuals, 100

_years of imprisonment for each defendant.

The actions were instituted by the filing of the in-

formation and the issuance and service of a summons

pursuant to Rule 9(a) of the Federal Rules of Criminal

Procedure. No indictment was returned, no preliminary

hearing was held before the United States Magistrate,

and no determination was made by a Magistrate or Judge

of the District Court that sufficient facts exist to warrant

subjecting the petitioners to the ordeal and expense of

defending themselves in a criminal trial.

The decision below resolves the question presented

in a way which undermines an important federal safeguard

and exposes a significant number of targets of criminal

prosecution to the detriments otherwise protected against

by the right to indictment by a grand jury. That historic

5. Petitioners asserted in the District Court and again in

the Court of Appeals that no good faith, conscientious decision

was ever made by proper authority that probable cause existed

to bring the present prosecution. Petitioners were denied the

opportunity for a gay» R. 28, 32-33; brief of petitioner Yellow

in Court of Appeals, pp. 3-4, 38-39.

guarantee is vital today for the same reasons that caused

its inclusion into the Bill of Rights. It was designed not

merely as a way to initiate the trial of a criminal charge,

but as a means to protect the accused “against unfounded

accusation, whether it comes from government, or be

prompted by partisan passion or private enmity.” Ex parte

Bain, 121 U.S. 1, 11 (1887). Indeed it has often been

reiterated, and has become well accepted, that that purpose

is the primary one. But other goals are subsumed. The

grand jury’s screening function protects against the hard-

ships imposed by being subjected to an unwarranted trial;

it restricts the criminal process so that:

“no one shall be subjected to the burden and expense

of a trial until there has been a prior inquiry and

adjudication by a responsible tribunal that there is

probable cause to believe him guilty.” Beavers v.

Henkel, 194 U.S. 73, i}4 (1904).

In this way, it prevents oppressive, arbitrary action by

the government, protectin,’ the defendant against the un-

warranted stigma and expense arising from hasty and mali-

cious prosecutions and unsubstantiated allegations of

wrongdoing. See, Ex parte Bain, 121 U.S. 1, 11-12 (1887);

Charge to Grand Jury, 30 F. Cas. 992, 993 (No. 18,255)

(C.C.D. Cal. 1872), 2 Sawy. 667; Gerstein v. Pugh, 420

U.S. 103, 117 n. 19 (1975); United States v. Wells, 163

Fed, 313, 324 (D. Idaho 1908). In keeping with its his-

toric roots, it is still recognized as a protection “to provide

a fair method for instituting criminal proceedings against

persons believed to have committed crimes.” Costello v.

United States, 350 U.S. 359, 362 (1956). In 1976, Chief

Justice Burger, in announcing the judgment of the Court

in United States v. Mandujuano, 425 U.S. 564, 571, wrote:

“The grand jury is an integral part of our con-

stitutional heritage which was brought to this country

with the common law. The Framers, most of them

trained in the English law and traditions, accepted

the grand jury as a basic guarantee of individual lib-

erty; notwithstanding periodic criticism, much of

- which is superficial, overlooking relevant history, the

-. grand jury continues to function as a barrier to reck-

less or unfounded charges. ‘Its adoption in our Con-

stitution as the sole method for preferring charges

in serious criminal cases shows the high place it held

as an instrument of justice.’ Costello v. United States,

350 U.S. 359, 362, 100 L.Ed. 397, 76 S.Ct. 406 (1956).

Its historic office has been to provide a shield against

arbitrary or oppressive action by insuring that serious

criminal accusations will be brought only upon the

considered judgment of a representative body of cit-

izens acting under oath and under judicial instruction

and guidance.”

See also, United States v. Calandra, 414 U.S. 338, 342-

343 (1974); Stirone v. United States, 361 U.S. 212, 218

(1960); Application of Jordan, 439 F. Supp. 199, 206 (D.

W.Va. 1971).

The practical importance of this Fifth Amendment

right is not likely to be diminished. During the four

fiscal years 1976 through 1979, 574 corporations have been

convicted in the federal courts, making it a common event.

Orland, Reflections on Corporate Crime: Law in Search

of Theory and Scholarship, 17 American Criminal Law

Review 501 (1980). An announced intention of the Depart-

ment of Justice to give increased priority to the investiga-

tion and prosecution of white collar crime is likely to

result in an even greater number of corporate defendants.

28 Criminal Law Reporter 2048, Oct. 8, 1980.

The Court of Appeals decision radically alters the

‘workings of the administration of the criminal law. It

places into the hands of the prosecutor alone, the un-

checked, unsupervised power to decide not only what

charges to bring but whether, and in what felony cases, to

proceed to trial. As demonstrated below, this result is con-

trary to applicable precedent and to the balance that has

previously been achieved in the criminal justice system.

B. Conflict With Applicable Precedent

i. The meaning of ‘infamous crime’’ and the

corporate defendant.

The Court of Appeals restricted the meaning of the

Fifth Amendment protection in a way which conflicts with

the decisions of this Court. First, whether a crime is in-

famous, and therefore triggers Fifth Amendment—grand

jury protection, depends upon the crime, not upon the

nature of the defendant. And a crime that is infamous

is so because of the maximum punishment authorized, not

because of what punishment might be imposed in a par-

ticular case. As was stated by this Court in 1891, after re-

viewing earlier decisions:

“{A] crime which is punishable by imprisonment

in the state prison or penitentiary, as is the crime of

which the defendant was convicted, is an infamous

crime, whether the accused is or is not sentenced or

put to hard labor; and that, in determining whether the

crime is infamous, the question is, whether it is one for

which the statute authorizes the court to award an in-

famous punishment, and not whether the punishment

ultimately awarded is an infamous one.”

In re Claasen, 140 U.S. 200, 205 (1891); see, Ex parte Wilson,

114 U.S. 417, 426 (1885); Mackin v. United States, 117 U.S.

348, 351 (1886); Fitzpatrick v. United States, 178 U.S. 304,

307 (1900); United States v. Moreland, 258 U.S. 433, 437,

441 (1922).

Thus, it is the punishment authorized by the legislature

‘which gives a crime its character as infamous. If a crime

is deemed serious enough by Congress to assign to it an in-

famous punishment, then the crime itself is an infamous

crime. The reason for this definition of infamous is ap-

parent. The seriousness of certain punishments reflects

the ignominy and disgrace which attaches to the offender

who violates a law carrying such a sanction. Crimes are

infamous because they represent society’s judgment about

their seriousness, and society’s judgment is reflected in the

punishment authorized. As Justice Brandeis wrote:

“Commitment to a penitentiary, with or without

hard labor, connotes infamy, because it is proof of the

conviction of a crime of such a nature that infamy was

a prescribed consequence.” United States v. Moreland,

258 U.S. 433, 450 (1922) (Brandeis, J. dissenting joined

by Taft, C.J. and Holmes, J.).

The grand jury protection was therefore intended to

apply when crimes of great magnitude were alleged, and

the magnitude is judged by the sentence legislatively au-

thorized for the crime. When the punishment authorized

by the legislature for the crime is an infamous one, the

accused, whether an individual or a corporation, has a right

to insist that there be no trial for that crime except upon

the indictment of a grand jury.

Exactly the same approach was adopted by the United

States Court of Appeals for the District of Columbia Cir-

cuit. That court held that the peculiarities of the de-

fendant (under the age of 22 years) and the actual sen-

tence imposed (up to six years under the Federal Youth

Corrections Act, 18 U.S.C. §5005, et seq.) do not control

the right to indictment. Rather it is the punishment au-

‘thorized by Congress in the statute alleged to be violated

that determines whether the crime (a misdemeanor in

the particular case) is infamous and thus whether ad-

herence to the Fifth Amendment’s indictment requirement

is essential. As the court stated:

“[The maximum term of six months’ imprison-

ment authorized by the misdemeanor statute] is the

punishment which reflects the prevailing views of the

governing authorities, represented by the law, as to

the seriousness of the offense—its infamous or non-

infamous character.” Harvin v. United States, 445

F.2d 675, 678 (D.C. Cir. en banc 1971), cert. denied,

404 U.S. 943 (1971); but see, United States v. Neve,

492 F.2d 465 (7th Cir. 1974).

The court below held that in determining whether a

crime is infamous, the “possibility of imprisonment in a

penitentiary is only one index.” App. A below, at p. A10;

637 F.2d 1248 at 1254. This plainly is wrong; no appellate

court has ever held that a crime punishable by over one

year is not infamous. To the contrary, the decisions are

uniform that a crime punishable by a term of imprison-

ment in the penitentiary [i.e., by over one year (18 U.S.C.

$4083) ] is an infamous crime. See, e.g., Mackin v. United

States, 117 U.S. 348 (1886); Fitzpatrick v. United States,

178 U.S. 304, 307 (1900); Michel v. Louisiana, 350 US. 91,

99 (1955); Stirone v. United States, 361 U.S. 212, 215

(1960). Thus, Justice Field, sitting as a Circuit Justice,

concluded that the phrase “infamous crimes” embraced

all felonies. Charge to Grand Jury, 30 F. Cas. 992, 993

(No. 18,255) (C.C.D. Cal. 1872), 2 Sawy. 667; and see,

United States v. Yates, 6 Fed. 861, 866 (E.D. N.Y. 1881).

Felonies are “serious” crimes, and serious crimes are “in-

6. Only one district court opinion could be found to support

the Ninth Circuit’s determination: United States v. Macklin,

389 F. Supp. 272 (E.D. N.Y. 1915), aff'd on other grounds, 523

F.2d 193 (2d Cir. 1975).

famous” crimes. United States v. Mandujuano, 425 U.S.

564, 571 (1976); Smith v. United States, 360 US. 1, 9

(1959); Costello v. United States, 350 U.S. 359, 361-362

(1956).

Rule 7(a) of the Federal Rules of Criminal Procedure

codifies the case law by concentrating upon the punish-

ment authorized for the offense. It is not in terms of either

the nature of the offender or the punishment actually im-

posed. And by definition it includes every felony. See,

18 U.S.C. §1(1). It provides that: “An offense which may

be punished by imprisonment for a term exceeding one year

[i.e., all felonies, 18 U.S.C. §1] or at hard labor shall be

prosecuted by indictment.” Fed. R.Cr. P.7(a). The courts

have adhered to this test. See, e.g., United States v. Mil-

lican, 600 F.2d 273, 276 (5th Cir. 1979); United States v.

Johnson, 585 F.2d 374, 377 (8th Cir. 1978), cert. denied, 99

S.Ct. 1246 (1979); United States v. Kahl, 583 F.2d 1351, 1355

(5th Cir. 1978); United States v. Owens-Corning Fiberglas

Corporation, 271 F. Supp. 561, 569 (N.D. Cal. 1967). In

sum, when the legislature chooses to make a crime punish-

able by more than one year in prison, it has designated that

crime as infamous for all purposes. Its designation reflects

a public policy decision which binds the courts and prose-

cutors. Any federal defendant convicted of such an of-

fense has been convicted of an infamous crime. Any fed-

eral defendant charged with such an offense is charged

with an infamous crime. In such cases, the Fifth Amend-

ment’s right to indictment applies.

This Court’s rulings on the right to counsel and to a

jury under the Sixth Amendment are relevant. They

adopt the same method of adjudication. Where the crime

charged is a felony, the right to counsel automatically ap-

‘plies, and the indigent defendant must be provided with

a lawyer at the state’s expense irrespective of the sentence

ultimately imposed: Gideon v. Wainwright, 372 US.

335 (1963); Baldasar v. Illinois, 100 S.Ct, 1585, 1592 n. 3

(1980) (Powell, J. dissenting); see, Mempa v. Rhay, 389

U.S. 128, 134 (1967); Argersinger v. Hamlin, 407 U.S. 25,

44-46 (1972) (Powell, J. concurring); 18 U.S.C. 3006A

(b). Similarly, in determining whether a defendant is

entitled to a jury, a court must look to the sentence au-

thorized, not to the sentence that is to be imposed. It is

the seriousness of the crime charged that governs, the

question, and seriousness is measured by the maximum

sentence assigned to the offense by the legislature. Dun-

can v. Louisiana, 391 U.S. 145, 159-162 (1968); Baldwin v.

New York, 399 U.S. 66, 69 (1970).

The Court of Appeals has carved an exception out of

the Bill of Rights on grounds not generally honored by

this Court or the lower courts. This is reflected by de-

cisions involving corporate defendants and their rights to

other constitutional guarantees. Corporate speech has

been held to be protected by the First Amendment. First

National Bank of Boston v. Bellotti, 435 U.S. 765 (1978).

The case turned upon whether “the corporate identity of

the speaker deprives this proposed speech of what other-

wise would be its clear entitlement to protection.” The

Court ruled that it did not; that the nature of the speaker

does not determine First Amendment protection. The

Court’s analysis focused on the purpose of the right—to

protect the free discussion of governmental affairs—and

concluded that that goal requires that the Amendment’s

protection attach to the speaker whether corporate or in-

dividual. Id. at 776-777.

A similar analysis produces a similar result under the

Fifth Amendment’s grand jury protection. The major pur-

pose of the right not to be tried without first being indicted

is to protect against the bringing of unfounded charges,

against arbitrary or oppressive prosecutions, and against

overzealous prosecutors. Obviously, no good reason would

permit such abuses to occur against corporate defendants.

Aside from the undesirability of allowing the government

to engage in improper conduct as prosecutor, the injury

to the corporate defendant in a criminal case can be severe.

The mere trial, apart from the conviction, can entail dis-

ruption to business, damage to reputation, and loss of trade

as well as the substantial expense of conducting a defense.

Corporate identity does not justify the deprivation of the

grand jury guarantee.

Similarly, government contentions that the double

jeopardy clause of the Fifth Amendment does not protect

corporations have been rejected. A corporation literally

can not be placed “in jeopardy of life or limb,” but the

policies supporting the safeguard and the potential harm

to the corporation exposed to the criminal process with-

out the constitutional protection have convinced the courts

that the corporation must be immune from the risks of

double jeopardy. United States v. Hospital Monteflores,

Inc., 575 F.2d 332, 334-35 (1st Cir. 1978); United States v.

Security National Bank, 546 F.2d 492, 494-95 (2d Cir.

1976); United States v. Southern Ry., 485 F.2d 309, 312

(4th Cir. 1973); United States v. Armco Steel Corp., 252

F. Supp. 364 (S.D. Cal. 1966); see, United States v, Martin

Linen Supply Co., 430 U.S. 564 (1977); Fong Foo v. United

States, 369 U.S. 141 (1962); United States v. American

Honda Motor Co., 273 F. Supp. 810 (N.D. Ill. 1967); United

States v. American Honda Motor Co., 271 F. Supp. 979

(N.D. Cal. 1967). In reference to the double jeopardy

clause, it has been written, in words relevant to the Fifth

Amendment’s indiciment protection:

“It is true that corporations do not have human

emotions, but that does not mean that they do not

‘suffer’ during criminal trials in the sense of ex-

periencing harm to a legitimate, protectible interest.

We can take judicial notice of the fact that corporate

well-being is heavily dependent on that elusive quality

known as ‘good will’. A corporation that falls out of

favor with society will suffer. Its suffering may be

of a different character than an individual’s, but that

does not make those sufferings any the less real or

hazardous. Corporations can lose money, sometimes

substantial amounts, as the result of criminal prose-

cutions. Corporations can be made very insecure by

prolonged periods of bad publicity. This insecurity

may not be emotional, but it is very real and may affect

the corporation’s ability to do business with the public

or to raise capital on public markets, among other

possible ill effects.

Part of the penal sanction is the criminal stigma

that attaches to those who are convicted of crimes.

Whether the penalty is imprisonment or a fine, the

stigma still attaches, and it will attach whether the

accused is an individual or a corporation. ‘No corpo-

ration, large or small, can escape the “incalculable

effect” which a conviction may have on the public at-

titude toward the company.’ United States v. Security

National Bank, 546 F.2d 492, 494 (2d Cir. 1976).”

United States v. Hospital Monteflores, 575 F.2d 332, 335

(1st Cir. 1978); and see, Developments in the Law - Cor-

porate Crime: Regulating Corporate Behavior Through

Criminal Sanctions, 92 Harv. L. Rev. 1227, 1344 (1979).

Nor are corporations without Fourth Amendment

rights. See, e.g., G.M. Leasing Corp. v. United States,

429 U.S. 338, 353 (1977); Marshall v. Barlow’s Inc., 98

S.Ct. 1816 (1978).

The Sixth Amendment right to trial by jury, tradi-

tionally determined by a “petty-serious” distinction based

upon the possibility of imprisonment in excess of six

months, see, e.g., Baldwin v. New York, 399 U.S. 66 (1970),

has been applied to guarantee corporations trial by jury.

United States v. R.L. Polk and Co., 438 F.2d 377 (6th

Cir. 1971). The Court of Appeals in R.L. Polk and Co.

rejected as “simplistic” the government’s argument that

since the prevailing rule was “phrased in terms of im-

prisonment of individuals it has no applicability to corpora-

tions which cannot be imprisoned.” 438 F.2d at 379.

Corporations are deemed persons for the purpose of

being protected by other Constitutional provisions. They

receive the benefits of the Seventh Amendment (right

to trial by jury in civil cases). See, Ross v. Bernhard,

396 U.S. 531, 533-534 (1970). And they are entitled to

a full measure of rights under due process of law and

equal protection of the laws. First National Bank of Boston

v. Bellotti, 435 U.S. 765, 780 n. 15 (1978); see also, Grosjean

v. American Press Co., 297 U.S. 233 (1936) ; Louis K. Liggett

Co. v, Baldridge, 278 U.S. 105, 111 (1928); Safeguard Mu-

tual Insurance Co. v. Miller, 472 F.2d 732, 733 (3rd Cir.

1973); Pennsylvania Bank & Trust Co. v. Hamisek, 426

F. Supp. 410, 412-413 (W.D. Pa. 1977).”

7. An exception to the applicability of the Bill of Rights

to corporations is the privilege against self-incrimination. How-

ever, the underlying reason for the exception makes it an in-

appropriate precedent for this case. Historically, compulsion to

force someone to be a witness against himself icluded govern-

mentally imposed Tees poets and torture. But that is not

a danger that can upon the ay ogee or any artificial

entity. In this sense, a it. is not subject to the com-

pulsion element required privilege. Although com-

pulsion can be directed at v epresunnatives of the corporation,

corporate agents, like ground that ei else, have no por og BAB, to aero

ncrimina

~ bed on the their ‘testimony mi

Couch v. United States, 409

US. S aa2. 32 sant (1973). Ora > relate dh, officers or agents

can avail themselves of their own apg ge self-incrimina-

tion. generally, United States v. White, 322 US. 694, 699-

701 ate cur Curcio v. United States, 354 U.S. 118, 123-125, 128

tn ); Bellis v. United States, 417 US. 85, 89-91 (1974); 8

, Evipence, §2259(a) (McNaughton rev. 1961).

The Court of Appeals’ rejection of this important and

weighty precedent warrants the granting of certiorari.

That rejection occurred even though no interest has been

asserted by the prosecution and no governmental interest

has been referred to by the courts below which even

arguably justifies the removal of the indictment pro-

tection.

The opinion below lays down a needlessly intricate

test which will be difficult for prosecutors, defendants

and courts to apply. Instead of a clear line based on

the statutory punishment authorized, the Ninth Circuit’s

standard requires the determination of such nebulous issues

as whether the crime is mala in se and the exact philo-

sophical basis for the prison term authorized. Apparently,

if the philosophy behind the legislative decision was deter-

rence then the crime is not infamous, but if it was retribu-

tive then there is infamy. See App. A, pp. All-12, below;

637 F.2d 1248 at 1254-55.

The categorization of crimes as mala in se or malum

prohibitum has led to confusion and inconsistency, and

its abandonment has been recommended. See La Fave

and Scott, Criminal Law, pp. 29-31 (1972); Note, The Dis-

tinction Between Mala Prohibita and Mala in Se in Crim-

inal Law, 30 Col. L. Rev. 74 (1930). Similarly, sifting

out a particular reason for the prison term authorized

by Congress is an arduous—if not impossible—task. The

result of the Court of Appeals’ own research demonstrates

the unsatisfactory results such a probing produces. App.

A, p. Al2, n. 9, below; 637 F.2d 1248 at 1255, n. 9. Such

a multifactor test furnishes no real standard at all, unneces-

sarily complicating the rule as it has been developed by

the courts; namely, an infamous crime is a serious crime

as measured by the maximum sentence authorized. If

the maximum prison term provided for in the statute

is over one year, it is an infamous crime. If the maximum

sentence is one year or less, it is most likely not infamous

unless other attributes of infamy are present.

ii. In the absence of an indictment, a judicial

determination of probable cause prior to

trial was required.

a. Due Process of Law

Not being in custody, the petitioners do not rely on

Fourth Amendment law to support their claim that there

is a constitutional necessity for a judicial determination

of probable cause to believe that sufficient evidence exists

to warrant a trial. By relying on Fourth Amendment

precedent pertaining to a pre-charging requirement [Ger-

stein v. Pugh, 420 U.S. 103, 119 (1975) ] and ignoring cases

based on the Due Process Clause which are relevant to

the petitioners’ claim to the necessity for a pre-trial finding

of probable cause, the Court of Appeals reached a conclu-

sion that conflicts with decisions of this Court.

The Court of Appeals necessarily found that the mere

existence of an information, filed by a special assistant

prosecutor, should be deemed sufficient to cause a defen-

dant to stand trial. It is perhaps documenting the obvious,

but even early precedents recognized the importance of

avoiding the damage caused by putting an accused to trial

needlessly. Thus, it was held, in the context of the protec-

tion afforded by the grand jury that the right “. . . to be

secure from an open and public accusation of crime, and

from the trouble, expense, and anxiety of a public trial,

before probable cause is established . . . is justly regarded

as one of the securities to the innocent against hasty,

malicious and oppressive public prosecutions, and as one

of the ancient immunities and privileges of English liberty.”

Jones v. Robbins, 8 Gray 329, 344 (S. Jud. Ct. Mass. 1857).

Yet the Court of Appeals held no “important right”

and “no interest cognizable under the due process clause”

are asserted by the petitioners. App. A, pp. A7-8, below;

637 F.2d 1248, at 1252-53. In so holding, the court below

ignored the realities of the situation, and the legitimate ex-

pectation created by the practice in the courts of this coun-

try and by the Federal Rules of Criminal Procedure.

The petitioners have both liberty and property interests

at stake. Aside from the real and reasonable expectation

that all persons in this country have that they will not

be forced to trial unless probable cause exists to believe

they have committed a crime, and the ethical responsibility

of prosecutors to adhere to that principle,* which by them-

selves furnish a sufficient basis for the attachment of due

process safeguards, see, Vitek v. Jones, 445 U.S. 480 (1980),

that conclusion is supported too by Rule 5(c) of the Fed-

eral Rules of Criminal Procedure, and by Section 3060(e)

of Title 18, United States Code. See below, pp. 24-28. More-

over, the petitioners’ expectation is mutual; it is one that

is shared by the respondent. The United States Depart-

ment of Justice has prohibited the institution of any prose-

cution unless at the minimum, “the attorney for the gov-

8. This fundamental requisite to the filing of the informa-

tion is also a requirement under the Code of Professional Re-

sponsibility. See, A.B.A. ETHICAL STANDARDS, DISCIPLINARY RULE

7-103 (1969). And the A.B.A. STANDARDS For CRIMINAL JUSTICE

RELATING TO THE PROSECUTION FUNCTION §3.9 (1971) state that:

“It is unprofessional conduct for a tor to institute or cause

to be instituted criminal charges w he knows that the charges

are not supported by probable cause.” See also, NATIONAL AD-

vIsORY COMMISSION - CRIMINAL JUSTICE STANDARDS AND GOALS,

Courts §1.1 (1973). Upon defendant-appellant’s information —

belief (see affidavit of Stephen P. Murp arp at (R. 32-33)), such

conscientious determination was not proper authority.

be i eae Ee ed es a ee

to call witnesses and present evidence to establish the truth

of the matter. ed gy ead gk mee A end Tbe

; that refusal was United States v. Millican, 600

273 (Sth Cir. 1979); fo), United States v. Greenberg, 320 F.2d

467 (9th Cir. 1963).

ernment has probable cause to believe that a person has

committed a federal offense.”

These interests which the petitioners seek to protect

are not minimal; they are important. There is a sufficient

probability, indeed a certainty of injury, if fair procedures

are not implemented to protect the accused’s interests prior

to trial. Acquittal after a trial does not satisfy the due

process requirement. Even a favorable verdict will not

save the petitioners from the long, costly ordeal which any

criminal trial imposes and which the instant trial neces-

sarily will impose. The expense of preparing for trial

has already been great. Nor will a later acquittal eliminate

the unfavorable publicity which has already been en-

gendered by the filing of the charges and by the prose-

cutor’s own press release. R. 41-42. The trial itself will

inflict damage upon the reputation of the corporations.

Finally, their ability to conduct business while defending

themselves will be impaired as will their ability to maintain

their fiduciary duties to their shareholders.’®

9. S. Department of Justice Materials Relating to Prose-

cutorial Dacron 24 Crim. L. Rep. (BNA) 3001, 3002 (1978).

10. See this Petition, pp. 14-15 above. One comment on the

a of the double jeopardy protection to prevent multiple

——— ms of corporate defendants is pertinent to this point.

comment notes that the courts have stated “that a cor-

poration is just as likely to suffer from yen oppression of mul-

tiple trials as individuals, since exposure to reprosecution may

divert its resources from economic activity, harm its ability

to do business or raise capital, and cause embarrassment, ex-

pense, and anxiety to the people who make up the corpora-

tion. In addition to protecting defendants from harassment,

extending double jeopardy protection to corporations furthers

the institutional purposes of the clause: that there should be

ment; and that the effi and wsgreg A of the judicial system

should be furthered by a the finality and fairness

values expressed in the fifth ene allan ay eter omitted)

Developments in the Law - Corporate Crime: og, ms Tae’ 78

rate Behavior Through Criminal Sanctions, 92 Harv

1227, 1344 (1979).

Due process, therefore, applies for “as long as the

property deprivation is not de minimis, its gravity is ir-

relevant to the question whether account must be taken

of the due process clause.” Goss v. Lopez, 419 U.S. 565, 576

(1975); see also, Sniadach v. Family Finance Corp., 395

U.S. 337, 342 (1969) (Harlan, J. concurring); Boddie v.

Connecticut, 401 U.S. 371, 378-379 (1971); Board of Regents

v. Roth, 408 U.S. 564, 570 n. 8 (1972).

Because of the nature of those interests in the present

case, they must be protected by a preliminary adversary

hearing. This is true despite the facts that a trial ulti-

mately will follow and that the party suffering the loss

is a corporation. North Georgia Finishing, Inc. v. Di-

Chem, Inc., 419 U.S. 601 (1975); and see, generally, Mem-

phis Light, Gas & Water Division v. Craft, 436 U.S. 1, 16

(1978); Goss v. Lopez, 419 U.S. 565 (1975); Gaynon v.

Scarpelli, 411 U.S. 778 (1973); Morrissey v. Brewer, 408

U.S. 471 (1972); Fuentes v. Shevin, 401 U.S. 67 (1972);

Bell v. Burson, 402 U.S. 535 (1971); Boddie v. Connecticut,

401 U.S. 371, 379 (1971); Wisconsin v. Constantineau, 400

US. 433 (1971); Goldberg v. Kelly, 397 U.S. 254 (1970);

Sniadach v. Family Finance Corp., 395 U.S. 337 (1969).

The Court of Appeals’ decision conflicts with the above

decisions for surely, in light of, and in contrast to, their

holdings and the types of interests ordered to be given due

process protections, an accused forced to stand trial and

defend against criminal charges is entitled to “some kind”

of pretrial hearing to protect against an arbitrary loss of his

property or liberty interest.

Cases dealing with an individual’s reputation also con-

flict with the decision below. The corporation subjected to

a criminal trial suffers serious damage to its reputation,

and a corporation’s “goodwill,” based on its good name,

reputation and image of social responsibility, is similar to,

if not greater than, the liberty interest protected by Wis-

consin v. Constantineau, 400 U.S. 433 (1971). The Court in

Constantineau held invalid, because done without first ac-

cording a hearing, a posting of a person’s name so that sale

of liquor to that person would be forbidden for one year.

A hearing after the name was posted was not sufficient to

satisfy procedural due process requirements. Injury to

reputation alone may not be sufficient to trigger such due

process protection, but when that injury results in a loss

of other rights or in an alteration in status—such as ability

to buy liquor, or to hold a job, or as here to be free from

being tried as a criminal defendant and to suffer the result-

ing liberty and property losses attendant on the status as

a criminal defendant—then due process requires a pre-loss

hearing. See, Paul v. Davis, 424 U.S. 693, 706-710 (1976);

Perry v. Sindermann, 408 U.S. 593 (1972). The defendant

should not be required to suffer such loss, including expen-

diture of resources on pre-trial motions, discovery, trial

preparation, and its legal defense generally, without “some

kind of hearing” justifying the government’s actions.

A unilateral decision by a prosecutor to try a defen-

dant on criminal charges by the filing of an information

is, of course, not “some kind of hearing.” See, Gerstein

v. Pugh, 420 U.S. 103, 117 (1975); Albrecht v. United States,

273 U.S. 1, 5 (1927). The type of hearing which is due

depends on the circumstances, but the general guidelines

have been announced:

“(Ojur prior decisions indicate that identification

of the specific dictates of due process generally re-

quires consideration of three distinct factors: first,

the private interest that will be affected by the official

action; second, the risk of an erroneous deprivation of

such interest through the procedures used, and the

probable value, if any, of additional or substitute pro-

cedural safeguards; and finally, the government’s in-

terest, including the function involved and the fiscal

and administrative burdens that the additional or sub-

stitute procedural requirement would entail. See, e.g.,

Goldberg v. Kelly, supra, 397 U.S., at 263-271, 90 S.Ct.,

at 1018-1022.”

Mathews v. Eldridge, 424 U.S, 319, 334-335 (1976); Memphis

Light, Gas & Water Division v. Craft, 436 U.S. 1, 17-18

(1978).

These criteria, applied to the instant case, require that

a judicial finding of probable cause be made to justify

subjecting the petitioners to a trial. As already explained,

the interests of petitioners in avoiding the ordeal of a

criminal trial are strong. A pre-trial judicial finding that

probable cause exists to try the petitioners would be of

great value. Much like the grand jury’s function, it

would guard against unfounded charges or overzealous

prosecutors. A hearing, upon which such a probable cause

determination would be based, would weed out groundless

or unsupported charges and would avoid not only judicial

waste but the substantial defense burden and the igno-

miny that is inevitable for any accused involved in a crim-

inal trial. The trial itself, even if it results in a finding

of not guilty, does not adequately protect the defendant,

since even a trial resulting in an acquittal can be an

exhausting, expensive and damaging procedure. See, e.g.,

Alexander and Portman, Grand Jury Indictment Versus

Prosecution by Information - An Equal Protection -

Due Process Issue, 25 Hastings L.J. 997, 1003 (1974); Note,

The Preliminary Hearing - An Interest Analysis, 51 Ia.

L. Rev. 164, 173-174 (1965); Comment, Preliminary Ex-

amination - Evidence and Due Process, 15 U. of Kan.

L. Rev. 374, 376, 380 (1967); Note, The Function of the Pre-

liminary Hearing in Federal Pretrial Procedure, 83 Yale

L.J. 771, 783-787 (1974); and see, Coleman v. Alabama,

399 U.S. 1 (1970); People v. Elliot, 54 Cal. 2d 498, 354 P.2d

225, 6 Cal. Rptr. 753 (1960).

The government’s interest in preventing such a screen-

ing mechanism is not compelling, indeed, it is unsubstan-

tial. In fact, such a hearing would not be without benefits

to the prosecution." In addition, the preliminary finding

that probable cause exists to proceed to trial is already

required by the Federal Rules in most cases as discussed

below [see, Fed. R. Cr. P. 5(c)]. Generally, for example,

if felony charges are brought, the grand jury requirement

of the Fifth Amendment satisfies the need for a prelim-

inary finding of probable cause. Thus, the federal rules

in most cases will satisfy the requisites of due process.

See, Jaben v. United States, 381 U.S. 214, 220 (1965).

The exception to due process which the Court of Appeals

permits is not justified by the standard of Mathews v.

Eldridge, 424 U.S. 319, 334-335 (1976).

b. The Federal Rules of Criminal Pro-

cedure

The decision below is counter to the overall intent of

this Court and Congress as embodied in the Federal Rules

of Criminal Procedure. Those rules require generally that

either an indictment be returned or a preliminary hearing

be held. Rule 5(c) provides, for example, that a person

charged with a crime, whether in custody or released on

bail, “is entitled to a preliminary examination, unless

waived, when charged with any offense, other than a petty

offense, which is to be tried by a judge of the district

court.” The hearing otherwise required becomes nones-

11. Note, The Function of the Preliminary Hearing in Federal

Pretrial Procedure, 83 Yale L.J. 771, 783, 785-786 (1974); and see,

Note, A Constitutional Right to Preliminary Hearings for Ali

Pretrial Detainees, 48 So, Calif. L. Rev. 158, 179-183 (1974).

sential if it is waived by the defendant, or if an indictment

is returned prior to the date set for the preliminary hear-

ing, or if an information is filed before such date. Fed. R.

Cr. P.5(c). The latter exception demands greater scrutiny.

Such scrutiny establishes that the so-called exception

is not applicable to the case at bar. It is well acknowledged

that a preliminary hearing is an important part of the

criminal process, affecting critical rights of the defendant.

See, e.g., Coleman v. Alabama, 399 U.S. 1 (1970); see gen-

erally, Graham and Letwin, The Preliminary Hearing in

Los Angeles: Some Field Findings and Legal Policy Ob-

servations, 18 U.C.L.A. L. Rev. 635 (1971). United States

ex rel. Wheeler v. Flood, 269 F. Supp. 194 (S.D. N.Y. 1961).

While it makes some sense to permit the government to

utilize the grand jury finding of probable cause to avoid

allowing the defendant to have a preliminary hearing,

even there—despite the return of an indictment—the

courts have exercised their powers to refuse to deprive

the defendant of the opportunity to obtain a judicial find-

ing that probable cause exists to proceed to trial. See,

e.g., United States ex rel. Wheeler v. Flood, 269 F. Supp.

194 (S.D. N.Y. 1961); and see, Hawkins v. Superior Court

of San Francisco, 150 Cal. Rptr. 435, 586 P.2d 916, 22 Cal.

3d 584 (1978). Given the importance of the preliminary

hearing as a device to assure that probable cause exists

before subjecting the defendant to trial, it is not rational

to allow the avoidance of that hearing by an assistant

prosecutor’s personal decision embodied in an information.

That action by the prosecution, done without leave of

court, is no assurance that probable cause really does

exist.

It is for these reasons that the right to a preliminary

hearing under the Rules should be eliminated only in

the rare appropriate case, as when the defendant waives

the preliminary hearing or when a substitute form of

a judicial finding of probable cause is made. This construc-

tion of Rule 5 is supported by the language in section

3060(e) of Title 18, United States Code, which provides

that no preliminary hearing is required if prior to the

date fixed for the preliminary examination,’* “an indict-

ment is returned or, in appropriate cases, an information

is filed against such person in a court of the United States.”

(Emphasis supplied). See, United States v. Millican, 600

F.2d 273 (5th Cir. 1979).

The statute thus limits the Rule 5(c) exception to

“appropriate cases.” There are then inappropriate cases,

and to rigidly deny the defendant a judicial finding of

probable cause in every case in which an information

has been filed would not be in keeping with the spirit

of the Rules, with section 3060 of 18 U.S.C., or with the

constitutional requirements. It is pertinent to note in this

respect that the Rules were designed to be flexible enough

to meet the demands of fairness. As this Court has

said in another context: “[T]he Rules are not, and were

not intended to be, a rigid code to have an inflexible

meaning irrespective of the circumstances.” Fallen v.

United States, 378 U.S. 139, 142 (1964). They must be

read in light of the constitutional requirements they imple-

ment. See, Giordenello v. United States, 357 U.S. 480,

485 (1958).

The design of the Federal Rules of Criminal Procedure

has been violated in this case. In all federal prosecutions

in which felonies are charged, probable cause must be

determined by the grand jury, unless the accused waives

that right. It is the grand jury’s finding culminating in

the indictment that eliminates the necessity for a pre-

12. Nosuch date was ever fixed in the case at Sar.

liminary judicial finding of probable cause. Austin

v. United States, 408 F.2d 808, 810 (9th Cir. 1969); see,

Sciortino v. Zampano, 385 F.2d 132, 134 (2nd Cir. 1967),

cert. denied, 390 U.S. 906 (1968). The only exception

is the petitioners case, where despite the felony charge,

no judicial or grand jury finding of probable cause has

been made.

Clearly, “the prosecutor’s official path can not furnish

probable cause.” Gerstein v. Pugh, 420 U.S. 103, 117

(1975); and see, United States v. Kennedy, 5 F.R.D. 310

(D. Colo. 1946). Here the information is not even signed

by the United States Attorney, but by a “Special Assistant

United States Attorney.” Moreover, although there is an

attached verification, by a “Special Agent of the Interstate

Commerce Commission,” it is subscribed and sworn to

on “information and belief” alone. R. 6. See, United States

v. Greenberg, 320 F.2d 467 (9th Cir. 1963); United States

v. Millican, 600 F.2d 273 (5th Cir. 1979).

This then is little or no protection to the defendant

faced with the detriments attendant on defending against

criminal charges. As has been consistently held in Fourth

Amendment cases, a finding of probable cause must be

made by a neutral, detached person. See, e.g., Shadwick

v. City of Tampa, 407 U.S. 345 (1971); Coolidge v. New

Hampshire, 403 U.S. 443, 449-453 (1970); Johnson v. United

States, 333 U.S. 10, 13-14 (1948). The “officer engaged

in the often competitive enterprise of ferreting out crime”

is not the proper person to make the decision. Such a

practice can not be squared with basic fairness. See, John-

son v. United States, 333 U.S. 10, 13-14 (1948); and see,

Gerstein v. Pugh, 420 U.S. 103, 112-113 (1975); Brinegar

v. United States, 338 U.S. 160, 176 (1949). The judicial

finding “furnishes the nearest practicable safeguard against

malicious accusations,” United States v. Morgan, 222 U.S.

274, 282 (1911), as well as against capricious ones. Brine-

gar v. United States, 338 U.S. 160, 176 (1949). Plainly,

a summons issued or an information filed without judicial

involvement does not meet Fourth Amendment require-

ments. It should not be held to satisfy basic requirements

of fairness under the Fifth Amendment; nor should it

be deemed sanctioned by the Federal Rules of Criminal

Procedure.

C. The Court of. Appeals Decision Sanctions a

Procedure Which So Far Departs From the

Accepted and Usual Course of Judicial Pro-

ceedings That It Calls for an Exercise of This

Court’s Power of Supervision.

For all of the reasons given above, even if the issues

resting on the Constitution, statute and rules are not

reached, fairness and good practice in the administration

of the federal criminal law calls for this Court to exercise

its supervisory power to correct the decision below. The

petitioners are being forced to trial without a modicum

of procedural protection. There has been no indictment,

no judicial finding that probable cause exists to proceed

to trial, and no chance given the accuseds to challenge

and refute the assumption that a valid finding of probable

cause was ever made by the appropriate prosecuting of-

ficial. Even the information itself fails to satisfy the re-

quirements that it demonstrate—on its face—an adequate

basis for a probable cause finding. Instead, it recites the

allegations in conclusory terms much as an indictment

would, This is improper and inadequate, since no finding

of probable cause has been made by a court or grand

jury. United States v. Greenberg, 320 F.2d 467 (9th Cir.

1963); United States v. Millican, 600 F.2d 273 (5th Cir.

1979). .

Ironically, had the government proceeded against the

petitioners by instituting a civil action in order to obtain

a civil forfeiture amounting to three times the rebate al-

legedly improperly given or received (49 U.S.C. §11902),

the petitioners would have been protected by adequate

procedures. Under the Rules of Federal Civil Procedure

they would have had the opportunity to gain full discovery

and in effect to obtain a probable cause determination

by a judicial ruling on a motion for summary judgment.

By bringing a criminal action, the government has

severely curtailed the pre-trial procedural safeguards

available, while seeking fines of $1 million against each

petitioner. The government unfairly has upped the ante

but lowered the quality of procedural justice available

to the petitioners.

CONCLUSION

For the reasons stated, a writ of certiorari should

issue to review the judgment and opinion of Court of

Appeals for the Ninth Circuit.

Respectfully submitted,

Rosert POPPER

(Counsel of Record)

School of Law

University of Missouri-Kansas City

5100 Rockhill Road

Kansas City, Missouri 64110

(816) 276-1651

Ronatp E, SANDHAUS

Attorneys for Petitioners

APPENDIX

APPENDIX A

Opinion of the United States Court of Appeals

for the Ninth Circuit

(Filed October 17, 1980)

637 F2d 1248

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

No. 79-1665

DC No, F-77-227-Cr.

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

YELLOW FREIGHT SYSTEM, INC.,

Defendant-Appellant.

No. 79-1666

DC No. F-77-228-CR.

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

Vv.

DUNCAN CERAMICS, INC., a

corporation,

Defendant-Appellant.

OPINION

Appeal from the United States District Court

for the Eastern District of California

M. D. Crocker, District Judge, Presiding

Argued and Submitted August 11, 1980

Before: KILKENNY and FARRIS, Circuit Judges and

BELLONI,* District Judge.

FARRIS, Circuit Judge:

Yellow Freight System, Inc., and Duncan Ceramics,

Inc., appeal the district court’s deniai of various pretrial

motions to dismiss informations filed against them. Ap-

pellee United States moves to dismiss the appeals for lack

of appellate jurisdiction. We dismiss in part and affirm

in part.

On November 30, 1977, the United States served

Yellow Freight and Duncan Ceramics with summonses and

filed informations alleging that on fifty occasions Yellow

Freight knowingly gave and Duncan Ceramics knowingly

received rate concessions on interstate shipments of goods.

The Elkins Act proscribes rate concessions and imposes

a penalty of $1000 to $20,000 fine and up to two years’

imprisonment in a penitentiary for granting or receiving

rate concessions. 49 U.S.C. § 41(1), (3) (1976).

“Honorable Robert C. Belloni, U.S. District Judge for the

ae of Oregon, sitting by designation.

1. The Act of October 17, 1978, Pub, L. No. 95-473, 92 Stat.

1337, recodified the substantive provisions involved in this case.

Prior to this Act, the Elkins Act was codified at 49 U.S.C. §§ 41-43

(1976), but title 49 was not enacted as codified. The —_ pro-

visions of the Elkins Act now ap at 49 U.S.C. § 11903. Be-

cause the crimes charged alleg took place the 1978

Act, we use the 1976 orton geld Fenton de: rear agg

The 1978 Act did not, however, purport =

substantive law. See Act of Oct. 17, 1978, Soe 3(a). Pub, L. No.

95-473, 92 Stat. 1337, 1466.

On April 3, 1979, Yellow Freight and Duncan Ceramics

filed a set of motions in the district court to dismiss the

informations. In part these motions claim that the Elkins

Act does not apply to motor carriers. In addition, how-

ever, this set of motions alleges that the informations are

procedurally insufficient because (1) the crimes alleged

are infamous and therefore must be prosecuted by grand

jury indictment and (2) in any event the prosecution

may not proceed without a preliminary determination of

probable cause. The district court denied these motions.

I. Appellate Jurisdiction

Yellow Freight and Duncan Ceramics seek to base

appellate jurisdiction on 28 U.S.C. § 1291 (1976), which

grants appeals of right from “final decisions of the dis-

trict courts.” Specifically, they attempt to characterize the

denial of their second set of motions as a “collateral order”

appealable as a final decision under the rationale of Cohen

v. Beneficial Industrial Loan Corp., 337 U.S. 541, 545-47

(1949).

As applied to criminal pretrial orders, this rationale

confers appellate jurisdiction when:

1, The pretrial order fully disposed of the appellants’

claim;

2. The appellants’ claim is collateral to, and separable

from, the principal issue of guilt or innocence; and

3. The order involves an important right that would

be lost if review had to await final judgment.

See Abney v. United States, 431 U.S. 651, 658-62 (1977);

United States v. Griffin, 617 F.2d 1342, 1344-46 (9th Cir.

1980). Inquiry into the immediate appealability of a par-

ticular pretrial order must focus upon each claim asserted.

Thus immediate appealability of one of the defendants’

claims will not confer pendent appellate jurisdiction over

defendants’ other claims. Abney v. United States, 431

U.S. 651, 662-63 (1977). Accordingly, the threshold issue

of appellate jurisdiction must be addressed for each of

the three claims asserted by the defendants, Yellow Freight

and Duncan Ceramics.

A. Elkins Act Contention.

Yellow Freight and Duncan Ceramics claim that the

particular provisions of the Elkins Act asserted in this case

do not apply to motor carriers is not immediately ap-

pealable. The issue is “plainly not ‘collateral’ in any sense

of that term.” Abney, 431 U.S. at 663. It “may be re-

viewed effectively, and, if necessary, corrected if and

when a final judgment results.” Id. We accordingly grant

the motion to dismiss the appeal as to the defendants’ sub-

stantive claim.

B. Indictment Clause Contention.

Yellow Freight and Duncan Ceramics contend that

they have been charged with an infamous crime for which

they may not, under the indictment clause of the Fifth

Amendment, be “held to answer” except upon grand jury

indictment. This claim meets all three of the standards

for immediate appealability. Denial of defendants’ motion

completely and finally determined their claim in the trial

2. Citing C. A. Wi oo oe Sa , Federal Prac-

ee So Dee ee 7, at 58 n.5 (Supp. 1980), Duncan Ce-

ramics contends that Abney imposed no blanket prohibition of

pendent appellate jurisdiction but merely held’ that pendent re-

Taeted ws Uae oman ef Toei Su npegedag : ot Moan pe Bret

o. MacDonald, 43 435 US ase, 8 357 rr aT; Fated’ “States v.

582 F.2d 186, 196 (2d Cir. 1978 denied, 439 U.S.

ions (1979) ; United States v. Cerilli, 558 Fad 697, 699-700 (3d

Cir.), cert. denied, 434 U.S. 966 (1977).

court. Allowing the trial to progress so that facts may

develop will not facilitate consideration of their claim.

Cf. United States v. MacDonald, 435 U.S. 850 (1978) (no

immediate appeal of denial of speedy trial claim under

Sixth Amendment because determination of merits of claim

depends on circumstances surrounding trial). Second,

the entitlement of Yellow Freight and Duncan Ceramics

to an indictment before prosecution is wholly collateral

to and independent of the issue of their guilt on the un-

derlying charges. Finally, the claim involves a right that

would be irretrievably lost if the defendants were forced

to stand trial before appeal. One purpose of the indict-

ment clause is to shield defendants from unwarranted

prosecution for serious crimes. Wood v. Georgia, 370 U.S.

375, 390 (1962); Stirone v. United States, 361 U.S. 212, 218

& n.3 (1960); Gaither v. United States, 413 F.2d 1061, 1066

(D.C. Cir. 1969); United States v. Cox, 342 F.2d 167, 170

(5th Cir.), cert. denied, 381 U.S. 935 (1965); see also

United States v. Basurto, 497 F.2d 781, 785 (9th Cir. 1974).

Like the contentions held immediately appealable in Abney

and Griffin, therefore, this claim “involves a right to be

free from prosecution itself, rather than merely to be free

from subsequent conviction.” Griffin, 617 F.2d at 1345;

see Abney, 431 U.S. at 660-62. We therefore deny the

motion to dismiss with respect to this claim.*

3. In re Fendler, 597 F.2d 1314 (9th Cir. 1979), does not

og" a different result. That case involved a denial of a

m to conduct a voir dire of grand jurors regarding le

reg Such attacks on the procedure followed by a grand jury

are ordinarily not immediately appealable. The present case,

on the other hand, involves a claim that trial itself cannot pro-

ceed except according to a grand jury indictment.

The issue of the og appealability of indictment

clause claims was presented, " : not decided, in

Helstoski v. Meanor, 442 U.S. 600 Y apne), former congress-

man was charged by indictment with soliciting money from aliens

in return for introduction of private bills in Congress. The indict-

(Continued on following page)

C. Due Process Contention.

Finally, Yellow Freight and Duncan Ceramics con-

tend that, even if they may be prosecuted by information,

they are entitled to a preliminary hearing on the issue of

probable cause. They assert that the trial itself will de-

prive them of protected liberty and property interests and

argue that due process requires a hearing. This conten-

tion fulfills the first two elements of the Abney test. It has

been fully disposed of by the trial court and is separable

from the principal issue of guilt or innocence. At first

blush, it also appears to meet the third element of the

Abney test. If review must await final judgment, the de-

fendants will have been subjected to a trial from which

they assert they are constitutionally immune.

Since Abney, many appeals from pretrial orders have

come before us. In these appeals defendants have demon-

strated remarkable ability to frame almost any argument

to meet the Abney test. Because the filing of an appeal

allowable under Abney deprives the trial court of jurisdic-

tion to proceed with trial, Moroyoqui v. United States, 570

F.2d 862, 864 (9th Cir. 1977), cert. denied, 435 U.S. 997

(1978), defendants delay their trial when they pursue

Abney appeals. So that defendants need not completely

forego speedy trial to seek vindication of the rights pro-

Footnote continued—

ment referred to legislative acts of the congressman. He claimed

squarely stand or the proposition that indictment clause claims

are immedia appeala e because may ve assumed

ee, lal woald oneeed according to the indictment.

tected by Abney, we must adopt procedures to dispose of

these appeals as quickly as fair consideration permits.

We therefore hold that, in order to show that his or

her claim involves an important right requiring immediate

review, a defendant must first identify a valid principle

of law that can apply to his or her case. See United States

v. Perkins, 433 F.2d 1182, 1183, 1186 (D.C, Cir. 1970) (dis-

missing Abney-type appeal because issues posed were in-

substantial). The defendant must then show that the

principle confers an important right and that the right

can only be preserved by immediate review. Failing such

showings, an Abney appeal will not survive a motion for

dismissal for lack of appellate jurisdiction.

Despite defendants’ artful pleading, their final claim

involves no important right that would be lost if we re-

fuse immediate review. Although a defendant arrested or

otherwise restrained has a Fourth Amendment right to a

preliminary hearing on the issue of probable cause, absent

restraint a prosecution may be maintained without any

finding of probable cause. See Gerstein v. Pugh, 420 U.S.

103 (1975), where after holding that an arrested Jefendant

is entitled to a judicial determination of probable cause

independent of the prosecutor’s decision to file an informa-

tion, id., at 117-18, the Court continued:

In holding that the prosecutor’s assessment of prob-

able cause is not sufficient alone to justify restraint

of liberty pending trial, we do not imply that the

accused is entitled to judicial oversight or review of

the decision to prosecute. Instead, we adhere to the

Court’s prior holding that a judicial hearing is not

prerequisite to prosecution by information. Beck v.

Washington, 369 U.S. 541, 545 (1962); Lem Woon v.

Oregon, 229 U.S, 586 (1913).

Id. at 118-19. Thus, defendants have identified no interest

cognizable under the due process clause. Because defen-

dants assert a claim based upon a legal theory foreclosed by

the Supreme Court, their claim does not involve an “im-

portant right,” 431 U.S. at 658, the third element of the

Abney test is not met, and the district court’s denial of

this claim is not immediately appealable.®

II. Prosecution of Corporations by Information

Yellow Freight and Duncan Ceramics contend that be-

cause they stand charged with offenses punishable by two

years in a penitentiary, they may be prosecuted not by in-

formation, but only by grand jury indictment. The Fifth

Amendment states that “[n]o person shall be held to an-

4. See also 420 U.S. at 125 n.26 (“Because the probable

cause determination is not a constitutional prerequisite to the

charging decision, it is required only for those suspects who

suffer restraints on liberty other than the condition that

sopeer Pr trial.”) (emphasis added); United States v. Pickard,

207 F.2d 472, 474-75 (9th Cir. 1953) (absent arrest, prosecution

by information may proceed without oath or affirmation of prob-

able cause); Church v. United States, 412 F.2d 836, 838 (9th Cir.

1969) (same). But cf. United States v. Millican, 600 F.2d 273,

276-77 (5th Cir. 1979) (holding that a summons is sufficient

restraint to invoke probable cause requirement, where failure to

appear on summons may result in issuance of warrant), cert.

denied, 100 S.Ct. 1274 (1980).

5. The rule we establish today apply in other circum-

stances. For example, it might permit of Abney appeals

founded on statutes not in force or on overruled cases. We find

it peng rye A to define the contours of this rule, other than to

state that defendants’ indictment clause contention is appealable

while their due process contention is not. As future cases affect

the merits of particular claims, of course, the immediate appeal-

ability of those claims may change.

We have recently adopted an internal procedure for e

dited tion of Abney appeals on their merits under 9th

Cir. R. 6(h). United States v. Miranda-Parra, No. 80-1450, slip.

op. at 4411, 4413-14 (9th Cir. July 28, 1980); see also Abney,

431 U.S. at 662 n.8, Using this procedure, we disposed of the

ap in Miranda-Parra in less five weeks. Although the

6(h) procedure seems gener preferable, our ruling today

ensures that a motions panel of court can dispose of frivolous

Abney appeals even when 6(h) has not been invoked.

swer for ... [an] infamous crime, unless on . . . indict-

ment of a Grand Jury.” Relying on United States Supreme

Court pronouncements that infamous crimes are those “pun-

ishable by imprisonment in a penitentiary,” e.g., Green v.

United States, 356 U.S. 165, 183 (1958), defendants contend

that they have been charged with infamous crimes and

may not be prosecuted except on grand jury indictment.

In response, the United States notes that both de-

fendants are corporations and therefore not amenable to

imprisonment. It accordingly contends that this prosecu-

tion may proceed by information alone. See United States

v. Macklin, 389 F. Supp. 272, 273 (E.D.N.Y.), other hold-

ings aff'd, 523 F.2d 193 (2d Cir. 1975).

We agree with the United States that potential con-

finement in a penitentiary of some violators of a criminal

statute does not render all violations of that statute “in-

famous.” Congress may impose different punishments upon

different classes of criminals. It has done so in the pro-

visions of the Elkins Act here in question: the Act by

its terms limits penitentiary confinement to individuals.°

We do not, however, rest our holding upon this express

recognition by Congress of practical limitations on punish-

ment for corporate crime. Where, as in this case, a crim-

inal statute makes violations punishable by imprisonment

in a penitentiary, corporate violations of that statute are

not automatically made infamous crimes by the possible

infliction of such punishment on individuals.

Defendants argue that such a result completely de-

prives corporations of the right to grand jury protection.

6. While the Elkins Act imposes a $1000 to $20,000 fine on

“fe]very person or egg carbene val who knowingly gives or re-

— a concession, the provision imposing imprisonment applies

to “any person or any officer or director of any corporation.”

49 S.C. § 41(1) dg SA Thus, its own terms the imprison-

ment provision of the Elkins Act not apply to corporations.

Ald

We disagree. The possibility of imprisonment in a peni-

tentiary is only one index of whether a crime is infamous.’

Aside from tests of infamy that hinge on the possibility of

punishment to which corporations are not amenable, the

Supreme Court has occasionally suggested other incidents

of infamy. For example, in Ex parte Wilson, 114 U.S. 417,

423-24 (1885), the Court suggested that the Fifth Amend-

ment may require indictment for “crimes infamous in their

nature, independently of the punishment affixed to them.’*

In Wilson the Court also indicated that a congressional

declaration of infamy might suffice. Id. at 426; see also

United States v. Waddell, 112 U.S. 76, 82 (1884) (remand-

ing to the circuit court to determine the “very serious ques-

tion whether this crime is not made an infamous one by

the language of the statute,” which precluded violators

from holding office; considered separately from punish-

ment, the Court thought the language was “an indelible

disgrace affixed to the party convicted”); Ullmann v.

United States, 350 U.S. 422, 451 n.5 (1956) (Douglas, J.,

dissenting). In addition, crimes punishable at common law

by civil disabilities were deemed infamous. The indict-

ment clauses of several state constitutions are interpreted

7. e punishment attached to a crime is relevant to the

Pa s weg ony Mra because it indicates the character of the

crime as perceived Congress and the public. See Mackin v.

United States, 117 U . 348, 351, 352-53, 354 (1886) (in light of

common perception, crimes punishable by confinement to a

penitentiary are infamous); Ex parte Wilson, 114 U.S. 417, 427-28

Se A (for similar reason, crimes punishable by confinement at

bor are infamous). In the case of crimes by individua

the possibility of imprisonment for more than one year, an

therefore in a penitentiary, remains the most reliable index of

infamy. See “United States v. Driscoll, 612 #.2d 1155, 1156 (9th

Cir. 1980). It would be extremely rare for a crime by an in-

dividual that did not carry infamous punishment to made

kee by some other factor.

8. But see yo v. United States, 216 F, 292, 298 = es Cir.

ey r won on character -—_ ent), cert, denied,

235 U.S. 697 ( wey tome 4 v. United , 169 F. 86, 89 (6th

Cir. 1909) (same; dictum

All

to require indictment for such crimes, e.g., Elkin v. Com-

monwealth, 269 Ky. 6, 8, 106 S.W.2d 83, 84 (1937), and at

least one federal court has suggested that such crimes are

infamous within the meaning of the Fifth Amendment,

Hunter v. United States, 272 F. 235, 238 (4th Cir.), cert.

denied, 257 U.S. 633 (1921).

Since we hold that imposition of potential imprison-

ment on individuals violating a criminal statute does not of

itself make corporate violations of the same statute in-

famous crimes, the only remaining question is whether

another factor renders the crimes charged in this case in-

famous. The crimes charged are not made infamous by

the penalties attached to them, because those penalties are

only fines. A fine, regardless of its amount, cannot be

infamous punishment. See United States v. Armored

Transport, Inc., No, 79-1620, filed op. at 9-10 (9th Cir, Oct.

7, 1980). Nor is this crime inherently infamous. The

class of inherently infamous crimes, if it exists at all,

would encompass only the most serious mala in se. Regu-

latory crimes, such as those charged in this case, are not

inherently infamous.

The only perceptible basis for holding these crimes

infamous would be that Congress has declared these crimes

infamous by attaching the penalty of imprisonment in a

penitentiary to similar crimes committed by individuals.

The history of the statutes involved precludes such a basis.

Congress enacted the Elkins Act in 1903. In place of the

present provisions for penitentiary sentences, the original

Act provided:

In all convictions . . . for offenses under [various acts

regulating interstate commerce} .. . no penalty shall

be imposed on the convicted party other than the

fine prescribed by law, imprisonment wherever now

prescribed as part of the penalty being hereby abol-

ished.

Al2

Elkins Act, ch. 708, § 1, 32 Stat. 847, 847 [sic] (1903). The

present provision was added three years later by the Hep-

burn Act, ch. 3591, § 2, 34 Stat. 584, 588 (1906). Although

the Hepburn Act originated in the house, its restoration of

the penalty of imprisonment was the result of a Senate

amendment. The floor debate on the amendment indicates

that the amendment was designed to enforce more effec-

tively the ban on concessions, rather than to brand the giv-

ing of rebates with a special mark of infamy.’ The vio-

lations charged here are not infamous crimes. We affirm

the district court’s denial of defendants’ motion to dismiss.

In summary, we grant the motion to dismiss this ap-

peal with respect to the defendants’ Elkins Act and due

process claims. With respect to the defendants’ indictment

clause claim, the motion to dismiss the appeal is denied;

because the violations charged are not infamous crimes,

however, we affirm the district court’s rejection of that

claim.

Dismissed in part and affirmed.

9. 40 Cong. Rec. 6620-28 (1906). There were actually

three — g proposals on the Senate floor to reestablish the

penalty o Bae cov ag saggy Throughout the floor debate, various

speakers stressed the deterrent purpose of the penalty, thus

negating any inference that Congress intended the penalty as

an expression of the infamous character of the crime. But see

40 Co gone oy (statement of Sen. Daniel) (suggesting a

retributive Any assertion that the amendment rendered

anting o ‘aes an infamous crime is further undercut

by ‘the the fact that all three proposals denominated the offense a

misdemeanor.

Al3

Order of the United States Court of Appeals

for the Ninth Circuit

(Filed February 20, 1981)

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

No. 79-1665

DC No. F-77-227-Cr.

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

YELLOW FREIGHT SYSTEM, INC.,

Defendant-Appellant.

No. 79-1666

DC No. F-77-228-CR.

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

Vv.

DUNCAN CERAMICS, INC., a corporation,

Defendant-Appellant.

ORDER

Before: KILKENNY and FARRIS, Circuit Judges, and

BELLONI,* District Judge.

The panel as constituted in the above cases has voted

to deny the petition for rehearing. Judge Farris has voted

to reject the suggestion for a rehearing en banc and Judges

Kilkenny and Belloni recommend such rejection.

*The Honorable Robert C. Belloni, United States District

Judge for the District of Oregon, sitting by designation.

Al4

The opinion filed October 17, 1980 shall be amended

as follows:

Change the first paragraph of footnote 3 to read:

*In re Fendler, 597 F.2d 1314 (9th Cir. 1979),

does not require a different result. That case involved

a denial of a petition to conduct a voir dire of grand

jurors regarding possible bias. Such attacks on the

procedure followed by a grand jury are ordinarily

not immediately appealable United States v. Garner,

632 F.2d 758, 765 (9th Cir. 1980). The present case,

on the other hand, involves a claim that trial itself

cannot proceed except according to a grand jury indict-

ment. See id. (reserving question).

The full court has been advised of the proposal to

amend the opinion, and of the suggestion for en banc

rehearing, and no judge has objected to the amendment

or requested a vote on the suggestion for rehearing en

banc. Fed. R. App. 35(b).

The petition for rehearing is denied and the suggestion

for a rehearing en banc is rejected. The opinion filed

October 17, 1980 is amended as set forth above.

Al5

APPENDIX B

Memorandum and Order of the United States District

Court, Eastern District of California (United States v.

Yellow Freight System, Inc.)

(Filed August 28, 1979)

IN THE UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

No, F-77-227 Cr.

UNITED STATES OF AMERICA,

Plaintiff,

vs.

YELLOW FREIGHT SYSTEM, INC., a corporation,

Defendant.

MEMORANDUM AND ORDER

On May 7, 1979, the court took under submission de-

fendant’s motions to dismiss or stay the proceedings.

On May 17, 1979, the court granted the motion to

stay pending the Supreme Court’s decision in U. S. v.

Batchelder, but did not rule on the motion to dismiss.

Defendant is not satisfied with the Batchelder case

and has offered additional arguments on it’s [sic] motion to

dismiss, none of which are persuasive.

“Infamous crime” as used in the Fifth Amendment,

requiring presentment or indictment of a grand jury, has

traditionally been defined in terms of punishment rather

than the nature of the offense.

Defendant is a corporation and cannot be punished

by imprisonment in a penitentiary, so it may be charged

by information.

Al6

Therefore, defendant’s motion to dismiss is denied and

trial is set for Dec. 11, 1979, at 10:00 a.m.

DATED: August 28, 1979.

/s/ M.D. Crocker

United States District Judge

Memorandum and Order of the United States District

Court, Eastern District of California (United States v.

Duncan Ceramics, Inc.)

(Filed August 28, 1979)

IN THE UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

No. F-77-228 Cr.

UNITED STATES OF AMERICA,

Plaintiff,

VS.

DUNCAN CERAMICS, INC., a corporation,

Defendant.

MEMORANDUM AND ORDER

On May 7, 1979, the court took under submission de-

fendant’s motions to dismiss or stay the proceedings.

On May 17, 1979, the court granted the motion to stay

pending the Supreme Court’s decision in U.S. v. Batchelder,

but did not rule on the motion to dismiss.

Defendant is not satisfied with the Batchelder case

and has offered additional arguments on it’s [sic] motion to

dismiss, none of which are persuasive.

“Infamous crime” as used in the Fifth Amendment,

requiring presentment or indictment of a grand jury, has

Al7

traditionally been defined in terms of punishment rather

than the nature of the offense.

Defendant is a corporation and cannot be punished

by imprisonment in a penitentiary, so it may be charged

by information.

Therefore, defendant’s motion to dismiss is denied and

trial is set for Dec. 11, 1979, at 10:00 a.m.

DATED: August 28, 1979.

/s/ M.D, Crocker

United States District Judge

Als

APPENDIX C

Constitutional Provisions, Statutes and

Court Rules

The Fifth Amendment to the United States Constitu-

tion provides in its relevant part:

No person shall be held to answer for a capital,

or otherwise infamous crime, unless on a presentment

or indictment of a Grand Jury, except in cases aris-

ing in the land or naval forces, or in the militia, when

in actual service in time of war or public danger;

... nor be deprived of life, liberty, or property, with-

out due process of law;....

United States Code, Title 1:

§1 Words denoting number, gender and so forth

In determining the meaning of any Act of Congress,

unless the context indicates otherwise—

a en ee

the words “person” and “whoever” include corpora-

tions, .. . as well as individuals; ....

United States Code, Title 18:

$1. Offenses classified

Notwithstanding any Act of Congress to the contrary:

(1) Any offense punishable by death or impris-

onment for a term exceeding one year is a felony.

(2) Any other offense is a misdemeanor.

(3) Any misdemeanor, the penalty for which

does not exceed imprisonment for a period of six

months or a fine of not more than $500, or both,

is a petty offense.

Al9

§ 3060. Preliminary examination

(a) Except as otherwise provided by this section,

a preliminary examination shall be held within the

time set by the judge or magistrate pursuant to sub-

section (b) of this section, to determine whether there

is probable cause to believe that an offense has been

committed and that the arrested person has committed

it.

(b) The date for the preliminary examination

shall be fixed by the judge or magistrate at the initial

appearance of the arrested person. Except as provided

by subsection (c) of this section, or unless the arrested

person waives the preliminary examination, such ex-

amination shall be held within a reasonable time fol-

lowing initial appearance, but in any event not later

than—

(1) the tenth day following the date of the

initial appearance of the arrested person before

such officer if the arrested person is held in cus-

tody without any provision for release, or is held

in custody for failure to meet the conditions of re-

lease imposed, or is released from custody only

during specified hours of the day; or

(2) the twentieth day following the date of

the initial appearance if the arrested person is

released from custody under any condition other

than a condition described in paragraph (1) of

this subsection.

date fixed by the judge or magistrate for the pre-

liminary examination may be a date later than that

prescribed by subsection (b), or may be continued

one or more times to a date subsequent to the date

A20

initially fixed therefor. in the absence of such con-

sent of the accused, the date fixed for the preliminary

hearing may be a date later than that prescribed by

subsection (b), or may be continued to a date subse-

quent to the date initially fixed therefor, only upon

the order of a judge of the appropriate United States

district court after a finding that extraordinary cir-

cumstances exist, and that the delay of the preliminary

hearing is indispensable to the interests of justice.

(d) Except as provided by subsection (e) of this

section, an arrested person who has not been accorded

the preliminary examination required by subsection

(a) within the period of time fixed by the judge

or magistrate in compliance with subsections (b) and

(c), shall be discharged from custody or from the

requirement of bail or any other condition of release,

without prejudice, however, to the institution of fur-

ther criminal proceedings against him upon the charge

upon which he was arrested.

(e) No preliminary examination in compliance

with subsection (a) of this section shall be required

to be accorded an arrested person, nor shall such ar-

rested person be discharged from custody or from

the requirement of bail or any other condition of re-

lease pursuant to subsection (d), if at any time sub-

sequent to the initial appearance of such person before

a judge or magistrate and prior to the date fixed

for the preliminary examination pursuant to subsec-

tions (b) and (c) an indictment is returned or, in

appropriate cases, an information is filed against such

person in a court of the United States.

(f) Proceedings before United States magistrates

under this section shall be taken down by a court

reporter or recorded by suitable sound recording

A21

equipment. A copy of the record of such proceeding

shall be made available at the expense of the United

States to a person who makes affidavit that he is

unable to pay or give security therefor, and the ex-

pense of such copy shall be paid by the Director of

the Administrative Office of the United States Courts.

United States Code, Title 49:

§11903. Rate, discrimination, and tariff violations

(a) Apperson that knowingly offers, grants, gives,

solicits, accepts, or receives by any means transporta-

tion or service provided for property by a common

carrier subject to the jurisdiction of the interstate

Commerce Commission under chapter 105 of this title

(1) at less than the rate in effect under chapter 107

of this title, or (2) by practicing discrimination, shall

be fined at least $1,000 but not more than $20,000,

imprisoned for not more than 2 years, or both.

Federal Rules of Criminal Procedure:

Rule 5. Initial Appearance Before the Magistrate

Magistrate.

The Magistrate shall also inform the defendant

by his right to a preliminary examination.

A defendant is entitled to a preliminary examina-

tion, unless waived, when charged with any offense,

other than a petty offense, which is to be tried by a

judge of the district court. If the defendant waives

preliminary examination, the magistrate shall forth-

with hold him to answer in the district court. If

A22

the defendant does not waive the preliminary examina-

tion, the magistrate shall schedule a preliminary ex-

amination. Such examination shall be held within

a reasonable time but in any event not later than

10 days following the initial appearance if the defen-

dant is in custody and no later than 20 days if he

is not in custody, provided, however, that the pre-

liminary examination shall not be held if the defendant

is indicted or if an information against the defendant

is filed in district court before the date set for the

preliminary examination. With the consent of the

defendant and upon a showing of good cause, taking

into account the public interest in the prompt disposi-

tion of criminal cases, time limits specified in this

subdivision may be extended one or more times by

a federal magistrate. In the absence of such consent

by the defendant, time limits may be extended by

a judge of the United States only upon a showing

that extraordinary circumstances exist and that delay

is indispensable to the interests of justice.

Rule 7. The Indictment and the Information

(a) Use of Indictment or Information. An of-

fense which may be punished by death shall be prose-

cuted by indictment. An offense which may be pun-

ished by imprisonment for a term exceeding one year

or at hard labor shall be prosecuted by indictment

or, if indictment is waived, it may be prosecuted by

information. Any other offense may be prosecuted

by indictment or by information. An information may

be filed without leave of court.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.