Petition — Aladdin Hotel Corp. v. United States

_- ——— -

me wee eae ee — ———-

Ut, U. S.

PILED

MAY 28 1981

ores.

80-2024

No.

~

Ly

CLERK

——

In THE

Supreme Court of the United States

OcTOBER TERM, 1980

ALADDIN HOTEL CorPORATION, ef ai,

Petitioners,

vs.

UNITED STATES OF AMERICA,

Respondent.

PETITION OF ALADDIN HOTEL

CORPORATION FOR WRIT OF

CERTIORARI TO THE UNITED STATES

COURT OF APPEALS FOR THE

SIXTH CIRCUIT

NORMAN S. LONDON

LONDON, GREENBERG & FLEMING

1600 Boatmen’s Tower

100 North Broadway

St. Louis, Missouri 63102

(314) 231-8700

Attorney for Petitioner

— —-— —

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

QUESTIONS PRESENTED FOR REVIEW

1. May a corporate defendant be convicted of a conspiracy to

violate federal law upon a theory that it had conspired with its

own alleged agents and officers in connection with matters per-

taining to its operation and management?

It is legally possible, under federal law, for a corporation, ac-

ting only through its agents and employees, to conspire with

those same agents and employees?

2. The Petitioner Aladdin Hotel Corporation hereby adopts

and incorporates herein those questions and issues presented for

review by other appellants/peiitioners in this matter who have

or will file their respective petitions for writ of certiorari in con-

nection with this matter, to wit the petitions filed on behalf of

Charles Goldfarb, Edward Monazym, James Tamer, and James

Abraham.

PARTIES INVOLVED

In addition to Petitioner Aladdin Hotel Corporation, the par-

ties to this litigation are as follows:

CHARLES GOLDFARB, EDWARD MONAZYM,

JAMES TAMER and JAMES ABRAHAM,

Appellants/Petitioners,

vs.

UNITED STATES OF AMERICA,

Appellee/Respondent.

TABLE OF CONTENTS

Page

Questions Presented for ReviewW...........0ee0eeeees i

Partios lnveteed ...ccecceccosssvsecnsecesssuneeencs i

IRGOK oc cccccocccccecveescnesesssscsseetoenssuaus ii

Opinion BOW ..cccccccevccsnevcessescveusvarvass 1

JuarledictiOR ...ccvcccenccssccncserscccssescesessss |

Statutory Provisions Involved .............0eeeeeees 2

Seatomont Of the Case... cssccccccccccccessssuseses 2

Reasons for Granting the Writ ............005eeeeees 6

eo. Pee 8

Appendix:

A - Opinion of U.S. Court of Appeals ........... A-l

B - Order Denying Petition for Rehearing ........ A-24

TABLE OF AUTHORITIES

Cases:

Nelson Radio and Supply Co., Inc. v. Motorola, 200

P.26981 Gi Cle. IGE 6 oocvcsccnnvevesevaases 7

Poller v. Columbia Broadcasting System, Inc., 284 F.2d

TPL. Ca. TOG si caccscacncasveckaseasaey 7

Statutes:

28 U.S.C. §1254

18 U.S.C. §1952

18 U.S.C. §2...

eee eee eee eee eee eee

ee ee eee eee eee

Nevada Revised Statutes, Section 463.160.1({a) ........

Nevada Revised Statutes, Section 463.335 ............

ve we & NY WN

No.

In THE

Supreme Court of the United States

OctToser TERM, 1980

ALADDIN Hore. CorPORATION, ef al,

Petitioners,

vs.

UNITED STATES OF AMERICA,

Respondent.

PETITION OF ALADDIN HOTEL

CORPORATION FOR WRIT OF

CERTIORARI TO THE UNITED STATES

COURT OF APPEALS FOR THE

SIXTH CIRCUIT

OPINION BELOW

The opinion of the Court of Appeals is not yet reported but is

contained in Appendix A.

JURISDICTION

The decision and opinion of the United States Court of Ap-

peals was filed on March 5, 1981, and is attached hereto as Ap-

pendix A, and the denial of a timely petition for rehearing which

denial was filed on April 1, 1981 (Appendix B).

—

This Court has jurisdiction pursuant to 28 U.S.C. §1254, this

being a petition for review of the Decision and Opinion of the

United States Court of Appeals.

STATUTORY PROVISIONS INVOLVED

18 U.S.C. §1952 (commonly called the ‘‘Travel Act’’)

STATEMENT OF THE CASE

The Government originally filed a twenty-two count indict-

ment charging the Aladdin Hotel Corporation (hereinafter

Aladdin) and four individuals (Goldfarb, Tamer, Abraham and

Monazym) with offenses arising out of the alleged operations of

the Aladdin’s gambling casino. Tamer, Abraham and Monazym

were employees of the Aladdin and Goldfarb, although not

nominally an employee, was alleged by the Government to be

secretly an employee and agent of the hotel. Although the in-

dividual! defendants were charged with substantive offenses, the

Aladdin was charged only in Count 20 of the original indictment

which alleged a conspiracy to violate the ‘‘Travel Act’’ (18

U.S.C. §1952). Pursuant to the Court’s order requiring an elec-

tion of the various substantive Travel Act counts, the indict-

ment was amended such that the conspircy was charged under

Count 4 of the Amended Indictment. Specifically, Count 4 of

the ‘‘Revised Indictment) (which was Count 20 of the original

Indictment) alleged that defendants Goldfarb, Tamer,

Abraham and Monazym and the Aladdin conspired to travel in

and use the facilities of interstate commerce to conduct an

unlawful activity, to wit:

‘*... namely the ownership, operation, conducting and car-

rying on of gaming operations of [the Aladdin] by persons

who were not licensed by and whose interests in the gaming

casino had been concealed from agencies of the State of

Nevada, in violation of the laws of Nevada and to

thereafter perform and attempt to perform acts, promote,

on Sim

manage, establish, carry on and facilitate the promotion,

management, establishment and carrying on of this

unlawful activity in violation of Section 1952, Title 18,

United States Code.”’

Neither Count 4 nor its predecessor, Count 20 of the original

Indictment, specified the particular ‘‘laws of the State of

Nevada’”’ which were allegedly violated by the activity charged

although the substantive counts, in which the Aladdin was not

charged, alleged violations of Nevada Revised Statutes Sections

463.160.1(a) and 463.335 and various Gaming Commission

Regulations. Defendants filed a joint motion for bill of par-

ticulars requesting, with regard to the conspiracy count, that the

Government be required to specify by number which laws of the

State of Nevada were allegedly violated (See Motion for Bill of

Particulars, p. 7, { 11).

Additionally, defendants filed motions to dismiss the indict-

ment contending that the charges were ambiguous, and failed to

state offenses and contending further that the Nevada Gaming

Laws were unconstitutional. The Motion to Dismiss specifically

alleged, inter alia, that the allegations in the Indictment violated

the Sixth Amendment in that they: ‘‘fail to sufficiently appraise

the defendants of what they must be prepared to meet’’.

The Court denied the motion to dismiss and, although a hear-

ing was held on the motion for bill of particulars, the Court

‘deferred ruling’ thereon and the Government was not re-

quired to specify, with regard to the conspiracy count, which

Nevada statutes were allegedly violated.

Since the issues concerning the vagueness of the indictment

and the scope of the ‘‘Travel Act’’ to include misconduct not

probhibited by State statute is included within the petitions filed

by the other petitioners in this matter, these issues will not be

addressed herein but are adopted by this petitioner.

At the request of the trial judge, the Government during the

course of the trial filed its ‘“‘Theory of the Case’’.

ey en

It was the Government’s ‘‘Theory’’ that statutory violations

were shown if it was demonstrated that defendant Goldfarb,

who was alleged to be an agent of the corporation, had authority

to ‘‘comp”’ or extend credit without having obtained the ‘‘work

permit’? required by Nevada law or if it were shown that

Goldfarb and Tamer were ‘‘conducting”’ the gaming affairs of

the Aladdin without being licensed to do so under Nevada law

or that their alleged participation was undisclosed (Gov’t.

Theory of the Case, p. 4 & 5). With specific reference to the

Aladdin, the Government’s Theory was stated as follows:

With respect to the Corporate Defendant, Mr. Abraham

and Mr. Monazym, the theory is simple, common law

aiding and abetting and causation, now codified in 180

S.C. 2. In short, and this point is of particular importance

to the conspiracy charge, the ‘‘outsiders’’, Mr. Goldfarb

and Mr. Tamer, simply could not have participated in the

regulated business of the Hotel unless the ‘‘insiders’’ let

them.

It should be noted, however, that the Corporation was not

charged in the Indictment with an ‘‘aiding and abetting’’ of-

fense under 18 U.S.C. §2, nor was that section charged under

the conspiracy count.

The Government argued, however, that although Goldfarb

was not nominally an employee of the Aladdin, his alleged par-

ticipation in the operation and management of the Hotel sub-

jected him and the Aladdin to the reporting and disclosure pro-

visions of Nevada Statutes and Regulations.

Both during and after trial, the Aladdin filed general motions

for judgment of acquittal, which motions were denied. Peti-

tioner was convicted of the conspiracy count and was sentenced

to the maximum $10,000 fine.

a

An appeal was taken to the United States Court of Appeals

for the Sixth Circuit and the question was clearly presented and

argued as a separate and distinct point in the briefs there filed,

as to whether an ‘“‘intra-corporate’’ conspiracy was legally

possible under the circumstances of the case. This question was

not answered or even addressed in the Court’s Opinion.

—o

REASONS FOR GRANTING THE WRIT

The failure of the Court of Appeals to address the issue of

whether a corporation can be guilty of a conspiracy with its own

officers, employees and agents in matters pertaining to the

operation and management of the corporation leaves a void in

federal criminal law of conspiracy which should be answered by

this Court.

The thrust of the Government’s case on the conspiracy charge

was that the Aladdin, through its offers and agents, conspired

to violate the Travel Act in connection with the concealed

management of the casino by persons not licensed under what

the Government contends are applicable Nevada Statutes and

Regulations. The persons with whom the Aladding is alleged to

have conspired were Defendants Abraham, Monazym and

Tamer, all employees and agents of the Corporation, and

Defendant Goldfarb, who was alleged by the Government, and

apparently found by the jury, to be a manager and agent of the

Corporation. Consequently, under the Government’s Theory,

the Corporation, through its officers and agents, was alleged to

have conspired with its own officers and agents.

Stated another way, the Government’s theory of prosecution

was that Abraham, Monazym and Tamer as employees exercised

some measure of responsibility and control over the casino, that

Goldfarb, although not named as an employee, was, in fact, an

agent of the Aladdin who also exercised substantial responsibility

and control, and that all four conspired to promote and conceal

Tamer’s ‘“‘true role’? and Goldfarb’s influence. Each of the

natural defendants is thus either a de jure agent (Goldfarb) or a

de facto agent (Abraham, Monazym and Tamer).

Accordingly, the conspiracy which the Government alleged,

and which the jury found, is the same sort of intra-corporate

conspiracy which has been the subject of extensive discussion

under Section I of the Sherman Act. The question is whether it

is legally possible for a corporation, acting only through its

‘

a pon

agents and employees, to conspire with those same agents and

employees. Appellant Aladdin submits that it is not and, conse-

quently, the corporate defendant should have been entitled to a

judgment of acquittal.

In support of this argument, Petitioner invites the Court’s at-

tention to several cases involving alleged conspiracies under the

Sherman Anti-Trust Act. Nelson Radio and Supply Co., Inc. v.

Motorola, 200 F.2d 911 (Sth Cir. 1952) was an action for treble

damages for alleged violations of Sections 1 and 2 of the Sher-

man Act. The complaint alleged that a conspiracy in restraint of

trade existed among the defendant corporation, its president,

sales manager, officers, employees, representatives and agents.

The district court dismissed the complaint for failure to state a

cause of action and the court of appeals affirmed stating: (at

914)

A corporation cannot conspire with itself any more than a

private individual can, and it is a general rule that the acts

of the agents are the acts of the corporation ... And, of

course, a corporation and its subsidiaries can be guilty of a

conspirarcy in restraint of trade but that involves separate

corporate entities. In the instant case we do not have any

of those situations and it appears plain to us that the con-

spiracy upon which plaintiff relies consists simply of the

obscure assertion that the defendant, through its officers

and agents, conspired with itself to restrain its trade in its

products.

Similarly, in Poller vy. Columbia Broadcasting System, Inc.,

284 F.2d 599 (D.C. Cir. 1960), another treble damage action,

under the Sherman Act, the complaint alleged a conspiracy

among C.B.S. and its agents. Judgment was entered for the

defendant, and the court of appeals affirmed stating: (at 603)

Poller’s charge ... is in realty in a charge that CBS con-

spired with itself ... We conclude that CBS, its unincor-

porated division, and its employees were incapable of con-

spiring to restrain trade or commerce.

As indicated, these cases involve civil matters. The question

of the ‘‘intra-corporate”’ conspiracy in the context of a criminal

prosecution has yet to be addressed by the federal courts.

However, in the instant case, the jury in returning their ver-

dicts on the substantive counts, under the instructions given by

the court, necessariy had to find that Goldfarb was an agent of

the Corporation. If he was not, then the licensing and reporting

provisions of Nevada law which were allegedly violated would

have had absolutely no application to him. It could not be

disputed that Abraham and Monazym and Tamer were

employees of the Corporation. Consequently, under the charge

in the Indictment and the verdict of the jury the Corporation

was found to have conspired with itself, a legal and logical im-

possibility. Accordingly, the court should have entered a judg-

ment of acquittal and it was error to deny the motion.

Moreover, in failing to address this issue, the Court of Appeals

overlooked a very substantial issue regarding corporate criminal

liability.

CONCLUSION

For the foregoing reasons, as well as the reasons advanced by

the other petitioners in this matter, this Court should grant the

Writ of Certiorari and review the decision of the Court of Ap-

peals for the Sixth Circuit.

Norman S. London

LONDON, GREENBURG

& FLEMING

1600 Boatmen’s Tower

100 North Broadway

St. Louis, Missouri 63102

(314) 231-8700

Attorneys for Petitioner

APPENDIX

—*

Nos. 79-5255, 79-5317, 79-5318, 79-5319, 79-5320

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

Unrrep STATES OF AMERICA,

Plaintiff-Appellee,

ArpPEAL from the

United States District

CuanLes Gotprars, JaMEs TAMER,} (Court for the Eastern

James ApraHaM, Epwarp Mowna-| pistrict of Michigan.

ZYM, AND Tue ALappin Hore. Cor-

PORATION,

Defendants-Appellants.

V.

Decided and Filed March 5, 1981.

Before: Weick, Live.y and Brown, Croutt | Judges.

Weick, Circuit Judge. Appellants Sones “Goldfarb and

James Abraham appeal from judgments of conviction entered

upon jury verdicts of guilty of the substantive offense pre-

scribed by the Travel Act, 18 U.S.C. § 1952." All of the

118 U.S.C. § 1952 provides in pertinent part that:

(a) Whoever travels in interstate or foreign commerce

uses facility in interstate or foreign commerce, including

the mail, with intent to—

+) ne , Manage, establish, carry on, or facilitate

the on, management, establishment, or carrying on, of

any unlawful Seaen seie "

and thereafier perform ony of the

fl ge Re ee ee

om iain

appellants appeal from judgments of conviction for conspiracy

to violate the Travel Act, 18 U.S.C. § 371.2 The appeals were

consolidated for oral argument.

The appellants raise a number of issues on appeal® in their

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

five years, or both.

(b) As used in this section “unlawful activity” means (1) any

business yy = page I gamb: ..» in violation of the

laws of the State in which they are committed or of the

United States, ne

218 U.S.C. § 371 provides:

If two or more persons conspire either to commit any offense

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

any agency thereof in any manner or for pu and

one or more of such —- do any act to effect the object

of the conspiracy, each shall be fined not more than $10,000

or imprisoned not more than five years, or both.

If, however, the offense, the commission of which is the object

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

such conspiracy shall not exceed the maximum punishment pro-

vided for such misdemeanor.

3 These include the following:

(a) Appellant Tamer raises issues dealing with the denial of

his right to a unanimous verdict, the trial court’s failure to ex-

clude certain evidence, the court’s instructions to the jury and

denial of his motion to suppress.

(b) Aladdin contends that the conspiracy against it was a legal

and factual impossibility; that the indictment should have been

for vagueness or in the alternative that the court

erred in failing to grant the motion for a bill of particulars;

and that the court erred in failing to grant its motion for sev-

erance.

(c) Abraham contends that the evidence against him was

insufficient to support his conviction; that evidence of

an uncharged conspiracy should not have been admitted; that

certain in camera conducted to the exclusion of

Abraham constitute reversi error; and that he was entitled

to a mistrial as a result of the prosecution's allegedly irrelevant

and prejudicial questioning of a character witness.

(d) Monazym challenges the of the evidence t

pM aman ge Sy oe Ay = ay racies pet Nae a

eat ts eee Sa ee ee 6th Amendment

cou as a result o m camera which

were conducted to his exclusion. —

(e) Other aspects of the “common ” involve variance

and amendment of the indictment, onl misstatements and mis-

constructions of Nevada statutes and regulations.

(f) Each appellant expressly adopts the arguments of his co-

eo

Nos. 79-5255, 79-5317-20 United States v. Goldfarb, et al. 3

separate briefs. Each appellant assigns errors which pertain

specifically to the government's case against him, and the

appellants together present a number of common arguments.

One such common argument has several facets and is variously

formulated by each appellan:. It relates to the treatment by

the court of Gaming Regulations promulgated by the Nevada

Gaming Commission pursuant to statutory authority, viola-

tions of which appellants claim do not constitute unlawful

activity as prohibited by the Travel Act.

District Judge Feikens carefully considered all of these

issues in his “Opinion Denying Post Trial Motions” for judg-

ments of acquittal, new trial, and arrest of judgment. App.

438-458. We agree with his decision and affirm the judgments

of conviction for the reasons set forth therein on which we

will elaborate hereinafter.

Judge Feikens denied a pretrial motion of the defendants

to dismiss the indictment in an opinion reported in United

States v. Goldfarb, 464 F. Supp. 565 (£. D. Mich. 1979) in

which he ruled upon the constitutionality of the Nevada Gam-

ing Control Act and held it was not unconstitutional as being

violative of the due process rights of defendant Goldfarb who

was denied a gaming license.

In these appeals, the parties have filed four volumes of

appendices, 4,000 pages of transcripts, and tapes recording

conversations played for the jury but not included in the

transcripts.

Mostly issues of law are raised in the briefs. The brief of

Goldfarb’s counsel comwendably states: “The sufficiency of

the evidence to sustain the jury verdict is not in question here.”

Goldfarb had a remedy in the state court of Nevada which

he invoked to compel the issuance of a license to him but he

Hules of Appellate Procedure, Rule 26().

All of these issues were carefully considered by District Judge

Feikens in his bg Denying Post Trial Motions” for .

on ¢ nee , new trial, and arrest of judgment. App. 438-

ae ee

4 United States v. Goldfarb, et al. Nos. 79-5255, 79-5317-20

dismissed the suit. The trouble here is that Goldfarb and

the other defendants, by concealment and violation of Nevada

statutes and their implementing regulations authorized by the

statutes, were actually engaged in the illegal unlicensed man-

agement, maintenance, control and operation of the hotel and

casino.

I

Defendant-appellant Charles Goldfarb was a bondsman who

resided in Birmingham, Michigan. In 1971, he and a small

group of investors purchased the Aladdin Hotel and casino,

located in Las Vegas, Nevada, which at that time was owned

by the Recrion Corporation. Goldfarb then applied to the

State Gaming Control Board/Nevada Gaming Commission for

licensure as a stockholder-officer of the new corporation,

Aladdin Hotel Corporation. His request was denied when

the Nevada Gaming Commission determined that he had an

“unsuitable background and unsuitable associations.” Gold-

farb then divested himself of his eight percent (8%) interest

in the hotel-casino. He later acquired an option to purchase

stock from a licensed stockholder of the new corporation and

reapplied for a stockholder’s license. That application is still

pending and has not been ruled upon by the Commission.

Apparently, it has not been pressed.

The bulk of the evidence presented against the appellants

consisted of over 100 telephone conversations intercepted by

the government agents pursuant to court authorization. In

all, approximately 15,000 calls were intercepted. The conver-

sations introduced at trial were between Goldfarb and his

co-defendants: James Tamer, the Entertainment Director of

the Aladdin; James Abraham, the Executive Vice-President

and General Manager of the Aladdin; and Edward Monazym,

a Casino employee; as well as some calls between third parties

and the various co-defendants.

The evidence adduced at trial showed that Goldfarb, having

ae ee

Nos. 79-5255, 79-5317-20 United States v. Goldfarb, et al. 5

failed in his attempt to become a licensee owner of the hotel

casino, did with the aid of the other defendants, maintain a

secret and illegal role in the ownership, operation, conducting

and carrying on of the gaming operations of the hotel casino.

He recommended complimentary services, including free ac-

commodations, for certain customers and had a hand in arrang-

ing for the extension of credit for individuals whom he sent

to the hotel. His advice and assistance was sought and given

concerning certain financial problems of the hotel as well,

including arrangements for emergency financing with false

net worth statements to an unnamed bank or banks and also

possible sale or lease of the hotel. He finally arranged for a

loan from the Teamsters Pension Fund. The government con-

tended that this was in keeping with the defendants’ scheme

to engage in the clandestine ownership, conducting and carry-

ing on of the gaming operations of the Aladdin by persons

not licensed to do so and whose interest in the casino had

been concealed from the state in violation of certain Nevada

statutes and regulations.

The defendants contended that the evidence was perfectly

consistent with the fact that Goldfarb was a valued customer

of the casino; a former investor, and possibly a future stock-

holder-officer of the corporation; a close associate of the man-

agement personnel of the hotel; and an individual who had

used his contacts to direct many so-called “highrollers” to the

hotel, many of whom then became regular customers who lost

large sums in gambling.

This was a disputed issue of fact requiring resolution by

the jury.

The Travel Act, as applied to the instant case, required

that a facility of interstate commerce (here a telephone) be

used to promote, establish, carry on, etc., an unlawful activity.

“Unlawful activity” is defined as any business enterprise in-

volving gambling offenses in violation of the laws of the state

in which they are committed.‘

4 See footnote 1, supra.

—— en

6 United States v. Goldfarb, et al. Nos. 79-5255, 79-5317-20

There is some dispute as to the nature and essentiality of

the underlying state law violation, although most decisions

agree that it is the violation of federal law which is the

gravamen of a Travel Act offense. United States v. Prince, 529

F. 2d 1108 (6th Cir. 1976), cert. den., 429 U.S. 838; United

States v. Polizzi, 500 F. 2d 856 (9th Cir. 1974), cert. den.,

419 U.S. 1120 (1975). Some courts hold that proof of the

commission or attempted commission of a state defined crim-

inal offense is an essential element of a Travel Act conviction,

United States v. Hiatt, 527 F. 2d 1048 (9th Cir. 1975); United

States v. Polizzi, supra; United States v. Kahn, 472 F. 2d 272

(2d Cir. 1973), cert. den., 411 U.S. 982, while others hold

that it is not. United States v. Prince, 515 F. 2d 564 (5th Cir.

1975), cert. den., 423 U.S. 1032; United States v. Goldfarb,

464 F. Supp. 565 (E. D. Mich. 1979). It is certainly true that

the state crime need not be actually accomplished. United

States v. Pomponio, 511 F. 2d 953 (4th Cir. 1975), cert. den.,

423 U.S. 874.

It is abundantly clear that as a predicate to a Travel Act

conviction, absent a distinct violation of a law of the United

States, the defendants must have engegad in some form of

unlawful activity prohibited by the law of the State of Nevada.

This contention is beyond dispute and amply supported by the

language of the Act and by the case law.

The defendants-appellants were indicted on a four-count

Revised Indictment. In Count One of the indictment, Gold-

farb was charged with a substantive violation of the Travel

Act. The alleged “unlawful activity” was the

ownership, operation, conducting and carrying on of gam-

ing operations of a Las Vegas, Nevada gaming casino,

the ALADDIN HOTEL AND CASINO, by a person who

5 The original indictment consisting of 22 counts was found to be

multiplicitous by the trial court. ~~

on

Nos. 79-5255, 79-5317-20 United States v. Goldfarb, et al. 7

was not licensed by and whose interest in the gaming

casino had been concealed from agencies of the State of

Nevada in violation of Nevada Revised Statutes, Sections

463.160.1(a)* and 463.335,” and Nevada Gaming Com-

mission Regulations 3.100 paragraph 1, (b), (d), (f),

(g) and (i), 3.100 paragraph 3,° 3.110® and 8,060.'°

6NRS § 463.160(1)(a) provides:

License required.

1. It is unlawful for any person, either as owner, lessee or

employce, whether for hire or not, either solely or in conjunc-

tion with others:

(a) To deal, operate, carry on, conduct, maintain or expose

for play in the State of Nevada any game or slot machine as

defined in this chapter, or to operate, carry on, conduct or main-

tain any horserace book or sports pool;

*

without having first procured, and thereafter maintaining in

full force and effect, all federal, state, county and municipal

gaming licenses as required by statute or exdinanee or by the

governing board of any unincorporated city or town.

7NRS § 463.335 provides in pertinent part:

Gaming employees uired to hold work ts;

and review; confidential records; expiration of work permits.

1. As used in this section:

a) “Gaming employee” me person directly

Gin the eoerdiien at a nensestristen ao N nog and in-

cludes without limitation:

(1) Boxmen;

(4) Floormen;

(5) Hosts or other persons empowered to extend credit or

complimentary services;

(6) Keno runners;

(7) Keno writers;

(8) Machine mechanics;

(9) Security personnel;

(10) Shift or pit bosses;

Shills; and

(12) Supervisors or managers.

“Gaming employee” does not include bartenders, cocktail wait-

resses or other persons engaged in preparing or serving food

or beverages. .. .

8 Nevada Gaming Commission Regulation 3.100 provides in pertinent

F Employee report.

1. Annually, on or before the 15th of July, each nonrestricted

licensee, as defined in Reg. 4.030.1(b), shall submit an loyee

report to the board on a form to be furnished by the q

— we

8 United States v. Goldfarb, et al. Nos. 79-5255, 79-5317-20

The indictment alleges specific acts committed by Goldfarb in

the course of the performance of the unlawful activity.

Appellant Tamer was acquitted by the jury of the substan-

tive Travel Act count but was convicted of conspiracy.

fae report shell ientity every individual who fe directly se

indirectly engaged in the tion or supervision

gaming operations or p security activities of such non-

restricted licensee. The classes of gaming —

asp prema Se be exteey directly engaged in ad-

ministration or supervision of gaming:

() ‘All individuals who may approve or extend credit

in any amount, or whose recommendations in regard are

ordinarily or followed:

(a) All individuals who have the authority to su

a shift of any Senin on Goeucliy’ aotielty, tackading but

io) All individuals who may approve or extend to casino

yg complimentary house services other than as Gave

and the main‘

Twas S CSC

quired to be

i) All individuals who individual or as a of a grou

formulate management policy. " bal .

“Key employee.

FR Somer to euentins a significant i uence Bh

SS oo aming li-

censee or who is Sthould be toed tn the cnn ene -

required by Reg. 3.100 is a key employee.

ya

Nos. 79-5255, 79-5317-20 United States v. Goldfarb, et al. 9

Count Three charged appellant Abraham with a substantive

violation of the Travel Act in much the same language as the

charge against Goldfarb. The alleged unlawful activity was

based upon the same Nevada Statutes and Regulations."'

Abraham was alleged to have discussed with Goldfarb the

extension of complimentary privileges to patrons of the Aladdin

which constituted, directly or indirectly, the administration,

supervision and influence of Goldfarb over the gaming opera-

tions of the Aladdin with the consent and assistance of Abra-

ham and in violation of the aforementioned statutes and regu-

lations. Abraham was convicted on this count.

2. Whenever it is the judgment of at least 3 members of the

commission that the public interest and the policies set forth

in Nevada Revised Statutes Chapter 463, the Nevada Gaming

Control Act, will be served by requiring any key employee to

be licensed, the commission shall serve notice of such determina-

tion upon the licensee. The commission shall not be restricted

by the title of the job performed but shall consider the func-

tions and responsibilities of the person_involved in making

its decision as to key employee status. Grounds for requiring

licensing of a key employee which are deemed to serve the

public interest and the policies of the Nevada Gaming Control

Act include but are not limited to the following:

(a) The key employee is new to the industry, the particular

gaming establishment, the —, or the level of influence

or responsibility which he and the board or on

has little or outdated information concerning his character,

background, reputation, or associations, or

(b) Information has been received by the board or commission

which, if true, would constitute grounds for a finding of un-

suitability to be associated with a gaming enterprise.

10 Nevada Gaming Commission Regulation 8.060 provides:

Participation in operations. Except as and to the extent pro-

vided in these regulations | ype to emergency situations,

or on written approval of t communion, no person who pro-

to acquire an interest in any licensed gaming operation,

n a licensee or in a holding company shall in connection there-

with take any part or be permitted to take any part whatever,

as an employee or otherwise, in the conduct of such gaming op-

erations or in the operation of the establishment w n such

gaming operations are conducted during the ency of his

application for license or tc be permitted to acquire such interest.

1! The statutes and ulations relied upon are identical except

on Count Three omits Nevada Gaming Regulation 3.100(1)(b) and

— A-10 —

10 United States v. Goldfarb, et al. Nos. 79-5255, 79-5317-20

Count Four is the conspiracy count of the indictment on

which all of the defendants were convicted. It charged that

the defendants willfully and knowingly conspired to use facili-

ties of interstate commerce to promote, manage, establish,

carry on and facilitate the promotion, management, establish-

ment and carrying on of an unlawful activity, namely; the

ownership, operation, conducting and carrying on of gaming

operations of a Las Vegas, Nevada gaming Casino by persons

who were not licensed to do so and whose interest in the

gaming casino had been concealed from the State of Nevada

and did thereafter commit acts in order to promote this unlaw-

ful activity, all in violation of 18 U.S.C. § 1952, 18 U.S.C.

§ 371.

As before stated, the appellants filed two joint motions to

dismiss the original indictment. Those motions apply equally

to the revised four-count indictment. In the motion the appel-

lants argued, inter alia, that Nevada Gaming Commission

Regulations are not “law” for the purposes of criminal prosecu-

tions. From the earliest stages of the proceedings, the defen-

dants objected to and expressed concern over the notion that

a violation of a Nevada Gaming Commission regulation could

form the predicate state law violation required for a federal

prosecution under the Travel Act. It could not in and of

itself.

In response to the motion to dismiss, the government stated

that:

... the predicate “unlawful activity” in this prosecution

arises from the violations of the cited Nevada statutes

in each count. The additional citation to the regulations

is solely to provide additional particularity in indicating

the application of the statute to the specific activity de-

scribed in each count. We do not quarrel with the de-

fense position that violations of the regulations in and

of themselves are not criminal acts within the purview

of the Travel Act... .

We do not quarrel that the defendants would be en-

= Ali —

Nos. 79-5255, 79-5317-20 United States v. Coldfarb, et al. 11

titled to a charge that in order to find a defendant guilty

of a particular count that it must find a defendant vio-

lated the provisions of the Nevada statute cited and

described therein.

(Government's Response to Motion to Dismiss, Appendix

p. 138-39. )

Still claiming inability to comprehend and therefore defend

against the charges, the defendant's filed a joint motion for a

bill of particulars. The court requested the parties to agree

among themselves as to the particulars which they apparently

did.

The court instructed the jury as follows:

Now as to the meaning of the phrase unlawful activity

in the Travel Act, the State of Nevada has a comprehen-

sive scheme of regulatory statutes. Under those statutes

a gaming commission and a gaming board are established

and they are commanded to and have enacted regulations

which have the force of law. It is that law which defines

unlawful activity.

In Berman v. Riverside Casino Corp., 2A7 F. Supp. 243, 248

(D. Nev. 1964), affd 354 F. 2d 43 (9th Cir. 1965), the court

held that regulations promulgated by the Nevada Gaming

Commission “have the force and effect of law.” Cf. United

States v. Polizzi, 500 F. 2d 856, 875 (9th Cir. 1974), cert. den.,

419 U.S. 1120 (1975).

N. R. S. 463.1594 specifically provides that the regulations

are intended to implement the provisions of the statutes re-

quiring disclosure of a corporate licensee’s key personnel.

Also, N. R. S. 463.150(2)(a) provides that the regulations shall

prescribe “the method and form of application which any

applicant for a gaming license . . . shall follow and com-

plete... .” The court was thus required to include an in-

struction on regulations so that the jury would not completely

disregard them. The court did not instruct the jury at any

— A-12 —

12 United States v. Goldfarb, ct al. Nos. 79-5255, 79-5317-20

place that a violation of a regulation, in and of itself, consti-

tuted an “unlawful activity.” To give such an instruction would

have been prejudicial error. United States v. Eaton, 144 U.S.

677 (1892); Singer v. United States, 323 U.S. 338 (1944).

In United States v. Grimaud, 220 U.S. 506, 517 (1910) the

court stated:

From the beginning of the Government various acts have

been passed conferring upon executive officers power to

make rules and regulations — not for the government of

their departments, but for administering the laws which

did govern. None of these statutes could confer legisla-

tive power. But when Congress had legislated and in-

dicated its will, it could give to those who were to act

under such general provisions “power to fill up the details”

by the establishment of administrative rules and regula-

tions, the violation of which could be punished by fine or

imprisonment fixed by Congress, or by penalties fixed

by Congress or measured by the injury done.

Reliance by appellants on United States v. Gordon, 464 F.

2d 357 (9th Cir. 1972) is misplaced. That case held that

bookmakers and their employees do not engage in illegal

gambling business within the prohibition of federal law by

violating nonpenal regulations of state gaming commission.

Gordon appears to be somewhat in conflict with the subse-

quent decision of the Ninth Circuit in Polizzi and is not even

cited or discussed in Polizzi.

In United States v. Seelig, 622 F. 2d 207, 210 (6th Cir.

1980), we considered violations of the Controlled Substances

Act, 21 U.S.C. § 841(a)(1) and regulations promulgated there-

under which were authorized by Congress. There, as here,

the defendants contended that violations of the regulations

did not constitute an offense. We stated:

The combination of § 829(c) and § 822(b) thus requires

a person to dispense or distribute a schedule V drug for a

— A-13 —

Nos. 79-5255, 79-5317-20 United States v. Goldfarb, et al. 13

medical purpose and to be within the authority of their

registration as determined by the Attorney General. Sec-

tion 822(a) requires every person who distributes or dis-

penses controlled substances to register with the Attorney

General. Section 821 authorizes the Attorney General to

promulgate rules and regulations relating to the registra-

tion and control of the manufacture, distribution, and

dispensing of controlled substances. Section 871(b) au-

thorizes the Attorney General to promulgate and enforce

rules, regulations and procedures that he deems necessary

for the efficient execution of his functions.

Although Congress was not as clear in this statute as in

the one involved in Grimaud, this Court is satisfied that

the statute does expressly, albeit in a convoluted fashion,

provide that a violation of the promulgated rules consti-

tutes an unlawful act under the Controlled Substances

Act. Thus, counts 1-165 do charge crimes.

During the presentation of evidence to the jury in response

to the defendants’ and the trial court’s desire to have the legal

theory of the case made clear, the government filed a docu-

ment entitled “Government’s Theory of the Case.” Here

again, the government disclaimed reliance upon the Nevada

Gaming Regulations alone, stating that: “to be sure, a viola-

tion of the Regulations which is not concomitant with a statu-

tory violation will not support a Travel Act violation.” (Ap-

pendix, p. 283)

Thus the violation of the Nevada statutes and implementing

regulations would constitute unlawful activity under the Travel

Act. The disclosure provisions required by Regulation 3.100

are cumulative to those contained in the Nevada statutes.

N. R. S. 463.165, 463.339, 463.520, 463.530, 463.560.

In any event, under the conspiracy count, the violation of

the regulations alone would certainly be considered as overt

acts by the defendants committing them which are ingredients

of the crime of conspiracy.

= Arl4 —

14 United States v. Goldfarb, et al. Nos. 79-5255, 79-5317-20

With this principle in mind, we now turn to the trial court's

instruction to the jury on the meaning of “unlawful activity”

and the significance of the Nevada Gaming Regulations.

The court first instructed the jury on Count IV of the

indictment, the conspiracy charge. After preliminary matters

of defining conspiracy and its elements to the jury, the court

began to instruct on the application of the Travel Act. After

reading the Act, in pertinent part, the court instructed on the

meaning of th? phrase “unlawful activity.” As a general back-

ground, the court instructed as follows:

. . . the state of Nevada has a comprehensive scheme of

regulatory statutes. Under these statutes a gaming com-

mission and a gaming board are established and they are

commanded to and have enacted regulations which have

the force of law. It is that law which defines unlawful

activity.

In order to regulate gambling under Nevada law these

statutes require full disclosures. Only through full and

accurate disclosure of all persons who are connected with

gambling in Nevada can the Nevada gaming authorities

properly perform their functions in excluding from the

industry all who are in the authorities’ opinions, unsuit-

able or undesirable for any number of reasons. (Appen-

dix 1205-06)

The court further instructed the jury on unlawful activity

based upon a violation of Nevada statutory law as follows:

Nevada Revised Statute 463.530 requires that all persons

who require [sic] to become owners or shareholders in a

gaming operation must have come before the Nevada

gaming authorities for determination as to the suitability

for license. The Nevada gaming authorities then make

a decision whether to then issue a license to an applicant.

If they deny the applicant a license, that person may not

— A-15 —

Nos. 79-5255, 79-5317-20 United States v. Goldfarb, et al. 15

then thereafter exercise any ownership of, operation, con-

duct of the gaming affairs of the casino.

Another Nevada statute, NSR 463.130, states that the

violation of these Nevada gaming statutes is a crime, a

gross misdemeanor. Thus, by concealment of his owner-

ship or operation or conduct in the gaming conspiracy,

a person may violate the Nevada laws.

Keep in mind it is not the concealment itself which is the

violation of the statute I have just discussed but rather

the violation is the unlicensed ownership or operation of

the gaming casino which is accomplished by concealment.

(Appendix, p. 1206-07)

The court then continued:

I now take up another aspect of the Nevada laws on

gambling. One of the regulations, [3].100, which is man-

dated by Nevada statute is required, [sic] all holders of

non-restricted licenses to disclose to the Nevada gaming

authorities names of all persons exercising significant con-

trol and influence over gaming. Any changes in such

activities must also be reported to the Nevada gaming

authorities because of a strong state policy requiring clis-

closure of all persons who have significant control and

influence as to gaming, and because of the statutory com-

mand that all gaming licenses which, whether held by a

corporation such as the Aladdin Hotel or by individuals,

must be maintained in conformity with all relevant pro-

visions.

I instruct you that it is illegal under Nevada gaming laws

for anyone exercising a significant control and influence

as to gaming to conceal that control and influence from

the Nevada gaming authorities. The essence or gist of the

violation I have just outlined is concealment, for which

failure to disclose, this must be contrasted with the first

instance of violation I described earlier, that violation

having to do with an unlawful or unlawful licensing viola-

— A-16 —

16 United States v. Goldfarb, et al. Nos. 79-5255, 79-5317-20

tion of the Nevada casino, where the concealment is a

means to achieve the violation but not itself the actual

unlawful activity. (Appendix, p. 1207-08)

This in our opinion correctly stated the Nevada law.

In the instruction on the substantive offense charge against

Goldfarb, the court stated that:

[h]eretofore I have discussed with you in considering the

charge of conspiracy as to entail the meaning of the

phrase unlawful activity. Without repeating those in-

structions that I gave you then with the request that you

keep them in mind here, I specifically charge you that

the unlawful activity which it is alleged the defendant

Goldfarb engaged in is as follows: .. .

The court then described a statutory theory based on Nevada

Revised Statutes § 463.335 as was done in the conspiracy

charge. In concluding the instruction, the court again offered

the jury the elements of unlawful activity:

Additionally, in order for you to find the Defendant Gold-

farb guilty of the charges contained in Count I of the

indictment, the Government must also prove beyond a

reasonable doubt either that:

(1) Defendant Goldfarb willfully engaged in the own-

esrhip, operation or conducting or carrying on of gaming

operations of the Aladdin Hotel and Casino without a

license from the Nevada Gaming Authorities to do so, or;

(2) Defendant Goldfarb willfully concealed his owner-

ship, operation or conducting or carrying on of gaming

operations of the Aladdin Hotel and Casino from the

ating Gaming Authorities for which he was not li-

Or both of these elements. (Appendix pp. 1217-18)

This instruction was not duplicitous as claimed for either

or both elements constitute an offense under Nevada law. The

= Ail <=

Nos. 79-5255, 79-5317-20 United States v. Goldfarb, et al. 17

jury was also instructed that its verdict had to be unanimous.

In its opinion denying post trial motions, the court relied

on the Nevada statutes which it stated were broad enough to

encompass Goldfarb’s conduct. (App. 440)

IV

The indictment charged Tamer with violating NRS 463.-

160.1(a) and Nevada Gaming Commission Regulations 3.100

(1)(i), 3.100(3) and 3.110. He was charged with performing

as a “key employee” without being licensed to do so. Tamer

was acquitted of the substantive Travel Act violation.

After reading the indictment and summarizing the Travel

Act, the court instructed on the meaning of “unlawful activity”

as follows:

Under Nevada gaming laws a casino (or non-restricted

licensee as it is called) must report to the Nevada Gam-

ing Authorities the identity of anyone who is directly or

indirectly involved in the casino’s administration; that is,

anyone who has a significant influence and control at the

casino. The regulation that requires this disclosure has

the force of law and its requirement of disclosure is in

harmony with a number of other Nevada gaming statutes.

Thus, under Nevada gaming law, it is required that the

casino disclose the identity of anyone exerting significant

influence and control at the casino. The disclosure is

necessary so that the Nevada Gaming Authorities can

regulate gambling by determining that such a person

should be licensed, if he is to continue the exercise of sig-

nificant control and influence at the casino. Now, the

Aladdin itself is not charged with the violation. How-

ever, defendant Tamer is; it is charged in this indictment

that defendant Tamer did, in concert with the Aladdin,

cause his true role at the casino to be concealed from the

Nevada Gaming Authorities, in violation of Nevada gam-

ing laws.

— A-18 —

18 United States v. Goldfarb, et al. Nos. 79-5255, 79-5317-20

Vv

As to Abraham, the district court in instructing on Count

III of the indictment again carried through its interpretation

of “unlawful activity.” The court charged the jury as follows:

The unlawful activity here charged is a certain kind of

unlawful activity as is charged in Count I against Defen-

dant Goldfarb, although the telephone call alleged in the

indictment between defendant Goldfarb and defendant

Abraham occurred on March 15, 1977. (Appendix pp.

1226-27 ) ;

Additionally, in order for you to find defendant Abraham

guilty of the charges contained in Count III of the in-

dictment, the Government must also prove beyond a

reasonable doubt that defendant Abraham aided and

abetted defendant Goldfarb in either willfully engaging

in the ownership, operation, or conducting or carrying on

of gaming operations of the Aladdin Hotel and Casino

without a license from the Nevada Gaming Authorities

to do so, or in aiding and abetting the defendant Gold-

farb in willfully concealing his ownership, operation or

conducting or carrying on of gaming operations of the

Aladdin Hotel and Casino from the Nevada Gaming Au-

thorities for which he was not licensed; or both of these

elements. (Appendix p. 1229)

Thus the district court instructed the jury on the unlawful

activities; one based on the unlicensed operation of the Alad-

din; the other based on concealment which found its origin

in the court's construction of the Nevada Statutes and Gaming

Regulations, especially 3.100. In our opinion these instruc-

tions were correct.

VI

Goldfarb contends that there was a variance between the

allegations in the indictment and the evidence which resulted

— A-19 —

Nos. 79-5255, 79-5317-20 United States v. Goldfarb, et al. 19

in a judicial amendment of the indictment. Judge Feikens

correctly dealt with these issues in his opinion denying post

trial motions stating:

It appears Goldfarb alludes to principles of variance and

amendment. The two concepts are closely related. Vari-

ance refers to the failure of the government's proofs to

conform to the indictment. A variance is not fatal to

the prosecution unless the defendant could not reason-

ably have anticipated from the indictment what evidence

would be presented at trial or unless the indictment is so

vague as not to bar subsequent prosecution on the same

offense. United States v. Knuckles, 581 F 2d 305, 309

311, (2nd Cir), cert. denied 99 S Ct 581 (1978); United

States v. Fruehauf Corp., 577 F 2d 1038, 1056 (6th Cir),

cert. denied 99 S Ct. 349 (1978); United States v. Dunn,

577 F 2d 119, 123 (10th Cir 1978); Watson v. Jago, 558

F 2d 330, 333-334 (6th Cir 1977); United States v.

Maselli, 534 F 2d 1197, 1201-1202 (6th Cir 1976). A

variance is not ground for reversal unless the defendant's

substantial rights are abridged. United States v. Berger,

295 U.S. 78, 82 (1934). In this case I find no prejudicial

variance.

The apparent amendment claim needs more analysis, but

it too is without merit. It is settled since Ex Parte Bain,

121 U.S. 1, 10 (1887) that neither the court nor the

prosecutor may substantially change the indictment to

“suit its own notions of what it ought to have been or

what the grand jury would probably have made it if

their attention had been called to suggested changes . . .”

This is in keeping with the principle that a court may

not establish standards of conduct upon pain of imprison-

ment; such is the legislature’s domain. An amendment

to the indictment is per se reversible error. United States

v. Crocker, 568 F 2d 1049, 1059 (3rd Cir 1977), United

States v. Fruehauf, supra, at 1056. An amendment may

be express or “constructive” (effective). Id. In determin-

ing whether there has been a constructive amendment

can a

20 United States v. Goldfarb, ct al. Nos. 79-5255, 79-5317-20

inquiry should focus on whether any essential element of

the crime was proved by facts different than those alleged.

Stirone v. United States, 361 U.S. 212 (1960). Thus, if

the indictment alleges one sort of false testimony but the

government is permitted to prove another sort, false testi-

mony being necessary for conviction, an amendment has

occurred. United States v. Crocker, supra. Similarly, in

a Hobbs Act case, if a grand jury alleges one sort of

interstate nexus while proof and argument show another,

an amendment has occurred. Stirone v. United States,

supra. See United States v. Prejean, 494 F 2d 495, 497

(5th Cir 1974); United States v. Vesaas, 586 F 2d 101,

108 (8th Cir 1978).

In this case, there were three elements the government

was required to prove: (1) the use of an interstate

facility; (2) actual or attempted promotion, etc. of an

unlawful activity; (3) specific intent. United States v.

Prince, 529 F 2d 1108, 1112 (6th Cir), cert. denied 429

U.S. 838 (1976). The proofs did not diverge from the

course established by the requirement of these elements.

The only apparent argument available to Goldfarb (and

the other Defendants) is that the grand Jury did not

pass upon the exact shape of the illegal acts in Nevada,

which it is their constitutional right to have done. I

find this contention without merit. The grand jury

needed to know enough of the Nevada gaming laws to

make the indictment sufficient, which it did. My inter-

pretation of Nevada gaming law presented Defendants

with no new factual charges that they were required to

meet, to use variance phraseology, nor did it allow either

proof or argument of a new factual basis for any element

of the crime, to use amendment terminology. Moreover,

the allegation as to the Nevada offense was broad enough

to include the specific crime I have already explained.

It has often been held that one way to guard against a

constructive amendment claim is to draft an indictment

with generality, United States v. Crocker, supra, at 1059,

so long as it contains the necessary specificity.

— A-21 —

Nos. 79-5255, 79-5317-20 United States v. Goldfarb, et al. 21

vil

We find no prejudicial error in the court's denial of Abra-

ham’s motion to declare a mistrial because of improper cross-

examination of a character witness. One of the character

witnesses was General Ralph G. Taylor retired from the United

States Air Force. Attempts were made by Abraham’s attor-

ney to introduce into evidence Abraham’s gallantry as an

officer and pilot, his two tours in Vietnam and his communica-

tions with the White House. The court excluded such evi-

dence. We agree that it was not admissible except upon con-

viction to be considered in mitigation of the sentence. Error

was assigned as to the cross-examination of the character wit-

ness Lovell, a former city attorney in Las Vegas, who volun-

teered that Abraham enjoyed a good reputation with Nevada's

“law enforcement community.” He was asked upon cross-

examination whether he had heard that in order for a shop

or store to do business with Aladdin Hotel Corporation to

obtain store space in the area that payments were made

personally to Abraham, not to the corporation. Lovell an-

swered, “No, I don’t know that.” Before asking the question,

at a side bar conference with the court not in the presence

of the jury, the government produced evidence showing justi-

fication namely, the cancelled check and the court permitted

the question to be answered and gave proper instruction to

the jury as to its purpose. Further proceedings developed

thereafter including rebuttal and surrebuttal evidence and

when it appeared to everyone that this was creating a trial

within a trial, the government moved to withdraw the ques-

tion, in which counsel for Abraham joined. The trial court

granted the motion finding that “. . . the spirit of Michelson v.

United States, 335 U.S. 469 (1948) had been observed and

the prejudice, if any, was dissipated in Abraham’s favor.” App.

452, 453. We find no abuse of discretion on the part of the

District Judge in his handling of these issues.

Abraham and Monazym assign error because the trial court

— A-2? —

22 United States v. Goldfarb, et al. Nos. 79-5255, 79-5317-20

held certain in camera proceedings to which they were not

admitted. Abraham and Tamer assign error in the admission

of evidence of tape recorded conversations and documents

tending to prove that Goldfarb and Tamer used their influence

with Leonard, the Prosecuting Attorney of Genesee County

in local court proceedings which Tamer believed would assist

him in securing a license in Nevada.

A special Grand Jury sought to return an indictment against

Mr. Leonard which was not signed by the United States At-

torney. Chief Judge Kennedy who conducted the in camera

proceeding, wrote an opinion ordering the files sealed. The

trial judge ordered that the defendants who had not partici-

pated in the in camera proceedings be given access to them.

The government had issued a subpoena for the testimony of

Mr. Leonard but obtained a stipulation from all defense

counsel which obviated the necessity for its production.

We find no abuse of discretion on the part of the trial judge

nor any prejudice to Abraham and Monazym (See Opinion

Denying Post Trial Motions, (App. 456) ), nor was there any

abuse of discretion in denying the motions for a severance or

Tamer’s motion to suppress evidence.

Vill

Appellant Monazym challenges the sufficiency of the evi-

dence to support his conviction by the jury. The evidence is

detailed by the District Judge in his Opinion Denying Post

Trial Motions. (App. 449, 450). The evidence and the infer-

ences to be reasonably drawn therefrom must be viewed in

the most favorable light in favor of the government. Glass

v. United States, 315 U.S. 60 (1942); United States v. Dye,

508 F. 2d 1226 (6th Cir. 1974); United States v. Green, “48

F. 2d 1261 (6th Cir. 1977). So viewed, we are of the opinion

that the verdict of the jury is supported by abundant evidence.

In our opinion, the indictment charged only a single con-

spiracy.

— A-23 —

Nos. 79-5255, 79-5317-20 United States v. Goldfarb, et al. 23

Aladdin contends that the district court erred in denying

its motion for a severance. It alleges that it could not defend

itself except through the testimony of its alleged agents, who,

as defendants in this joint trial, had countervailing Fifth

Amendment rights not to testify.

The trouble with this argument is that the proof at the trial

showed that conspiratorial acts were committed by at least

six other officers, agents and employees of Aladdin who were

not defendants. Aladdin did not call any of them to testify

in its behalf. No showing was made by Aladdin that any of

its officers, agents or employees were willing to testify in its

behalf or exculpate it. There was no showing that in separate

trials any defendant would waive his Fifth Amendment priv-

ilege.

This matter was addressed entirely to the sound discretion

of the district court. Aladdin had a heavy burden to over-

come which it was unable to do. Cf. United States v. Vigil,

561 F. 2d 1316 (9th Cir. 1977).

Conclusion

The judgments of conviction are affirmed.

an i

APPENDIX B

Nos. 79-5255, 79-5317, 79-5318, 79-5319, 79-5320

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

United States of America,

Plaintiff-Appellee,

Vv.

Charles Goldfarb, James Tamer, James Abraham,

Edward Monazym, and the Aladdin Hotel Corporation,

Defendants-Appellants.

ORDER

(Filed April 1, 1981)

Before WEICK, LIVELY and BROWN, Circuit Judges.

Upon consideration of the petitions for rehearing in which all

of the appellants joined and also the separate motion for rehear-

ing filed by Appellant Aladdin Hotel Corporation, we are of the

opinion that the issues in these appeals were adequately treated

in our signed opinion and that said petition for rehearing and

motion for rehearing lack merit.

It is therefore ordered that the petition for rehearing and the

separate motion for rehearing be denied.

ENTERED BY ORDER OF THE

COURT

/s/ John P. Hehman

Clerk