Petition — Felsen v. United States

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Ou the JUL 14 1981

Aupeeme Court of the Huited Ftates “et. STEVAS,

OCTOBER TERM, 1980

NO.

MARK FELSEN,

Petitioner,

Uv.

UNITED STATES OF AMERICA,

Respondent.

PETITION FOR WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE TENTH CIRCUIT

ALEX STEPHEN KELLER

KELLER, DUNIEVITZ &

JOHNSON

950 - 17th Street, Suite 1650

Denver, Colorado 80202

(303) 571-5502

Counsel of Record for Petitioner

OPINIONS BELOW Boh lei rite

JURISDICTION — decay

QUESTIONS PRESENTED

STATUTES AND REGULATIONS INVOLVED

STATEMENT OF THE CASE ....

REASONS FOR GRANTING THE WRIT _..

CONCLUSION .......

APPENDIX

A. Opinion of the United States Court of

Appeals for the Tenth Circuit affirming the

judgment of the said District

B. Order of the United States Court of

Appeals for the Tenth Circuit denying

petitioner’s petition for rehearing —

C. Order of the United States Court of

Appeals for the Tenth Circuit staying

the mandate -

D. Telex from Mr. Swaters to petitioner . — -

Telex from Mr. Swaters to petitioner

E. Petitioner’s Instruction No. |

Petitioner's Instruction No. 2 _...

Page

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B-1

ii

AUTHORITIES CITED

Page

CASES

U.S. v. Bohle,

445 F. 2d 54 (7th Cir., 1971) —........ 7

U.S. v. Brown,

519 F. 2d 1368 (6th Cir., 1975) ie ee 7

U.S. v. Harris,

532 F. 2d 1283 (7th Cir., 1976) _ =

U.S. v. Rose,

570 F. 2d 1358 (9th Cir., 1978) 6

STATUTES

ee _... 2,

ee Scekemenseas 0

TEXTS

A.B.A. Standards Relating to the Administration

of Criminal Justice, the Prosecution

a wu. 2, 6

dn the

Supreme Court of the United States

OCTOBER TERM, 1980

|

MARK FELSEN,

Petitioner,

v.

UNITED STATES OF AMERICA,

Respondent.

PETITION FOR WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE TENTH CIRCUIT

Petitioner prays that a writ of certiorari issue to review

the judgment herein of the United States Court of Appeals

for the Tenth Circuit entered in the above entitled case on

May 5, 1981, petition for rehearing having been denied on

June 3, 1981; mandate having been stayed until July 16,

1981, pending the filing of this petition.

2

OPINIONS BELOW

The opinion of the United States Court of Appeals for

the Tenth Circuit affirming petitioner’s conviction is set

out in Appendix A. The order of the Court of Appeals de-

nying petitioner’s petition for rehearing is set out in Ap-

pendix B. The order of the Court of Appeals staying the

mandate is set out in Appendix C.

JURISDICTION

Jurisdiction of this Court is invoked under 28 U.S.C.

1254(1).

QUESTIONS PRESENTED

1. With reference to the jury charge, did the Court of

Appeals err by ignoring the statutory language “. . . without

reasonable cause to believe the truth of such statement . . .”

and instead approve the Trial Court's jury charge using

“willfullness” as a culpable mental state for this offense?

2. Did the Court of Appeals err by ignoring the pros-

ecutor’s violation of the A.B.A. Standards Relating to the

Administration of Criminal Justice, the Prosecution Func-

tion 5.7(d), by holding that the prosecutor thought she had

admissible evidence as the foundation for impeaching

questions of the defendant on cross-examination?

STATUTES AND REGULATIONS INVOLVED

The interpretation of 18 U.S.C. 542, with reference to

the culpable mental state, has not been previously inter-

preted by this Court.

STATEMENT OF THE CASE

On December 6, 1978, the Grand Jury in the United

States Disrict Court for the District of Colorado returned

an eight count indictment against the petitioner. He was

convicted of Counts I and III thereof, which are as follows:

8

“COUNT I

“The Grand Jury further charges that:

“Between on or about February 18, 1978 and

March 13, 1978, in the State and District of Colorado,

Mark Felson, (sic), d/b/a the President/Manager of

Ferrari Denver, Ltd., did willfully enter and introduce

into the commerce of the United States imported mer-

chandise to wit: a 1977 Ferrari Model 512BB, Ve-

hicle Identification Number 23091, by means of a

fraudulent or false invoice, declaration, affidavit, let-

ter, paper, or by means of a false statement, written or

verbal, all in violation of Title 18, United States Code,

Section 542.”

“COUNT II

“The Grand Jury further charges that:

“Between on or about April 11, 1978 and April

25, 1978, in the State and District of Colorado, Mark

Felson, (sic), d/b/a the President / Manager of Ferrari

Denver, Ltd., did willfully enter and introduce into

the commerce of the United States imported merchan-

dise, to wit: a 1978 Ferrari Model 400 Automatic, Ve-

hicle Identification Number 23557, by means of a

fraudulent or false invoice, declaration, affidavit, let-

ter, paper, or by means of a false statement, written or

verbal, all in violation of Title 18, United States Code,

Section 542.”

The first paragraph of the applicable statute, 18 U.S.C.

542, under which the petitioner was charged, is as follows:

“Whoever enters or introduces, or attempts to

enter or introduce, into the commerce of the United

States any imported merchandise by means of any

fraudulent or false invoice, declaration, affidavit, let-

ter, paper, or by means of any false statement, written

4

or verbal, or by means of any false or fraudulent prac-

tice or appliance, or makes any false statement in any

declaration without reasonable cause to believe the

truth of such statement, or procures the making of any

such false statement as to any matter material thereto

without reasonable cause to believe the truth of such

statement, whether or not the United States shall or

may be deprived of any lawful duties;”” (Emphasis sup-

plied)

The action was tried to a jury in March 1979 and peti-

tioner was found guilty on Counts II and IV. Judgment

was entered on April 25, 1979 and a notice of appeal was

filed April 27, 1979. Petitioner was sentenced to a term of

imprisonment of six months on one count and three years

probation on the other.

The case arises out of the entry of two Ferrari auto-

mobiles into the United States in February 1978 and April

1978. They were purchased by petitioner from Garage

Francorchamps in Brussels, Belgium. The garage agreed to

make the cars conform to United States E.P.A. (Environ-

mental Protection Agency) standards and petitioner agreed

to make them conform to United States D.O.T. (Depart-

ment of Transportation) standards. Essentially the charge

alleges that petitioner made false statemens to import the

vehicles through United States customs by filling out vari-

ous customs D.O.T. and E.P.A. forms with false informa-

tion. The man with whom petitioner dealt at Garage Fran-

corchamps was a Mr. Swaters, and Telexes from Mr. Swat-

ers were admitted into evidence and petitioner testified as

to his conversations and agreement with Mr. Swaters.

Among the major questions at the trial were whether

petitioner knew that the cars did not meet E.P.A. standards

or had E.P.A. certificates of conformity, whether, to bring

the cars into compliance with D.O.T. standards, (which

petitioner agreed to do), the parts to accomplish this were

5

“readily attachable”, and whether defendant intentionally

gave the wrong model number for the cars.

At the trial two Telexes from Mr. Swaters to petitioner

were admitted into evidence. Copies of these are attached

as Appendix D.

Because of these Telexes, petitioner's belief as to

whether or not the cars met E.P.A. requirements was cru-

cial and petitioner tendered proposed Instructions 1 and 2

which followed the words of the statute. These are attacked

as Appendix E. The Trial Court refused to give them and

the Court of Appeals affirmed that ruling.

During the trial petitioner testified on his own behalf.

On cross-examination the Assistant District Attorney com-

menced reading from a transcript and started asking peti-

tioner questions as to whether he told Mr. Swaters certain

things. It became apparent that she was using the transcript

to cross-examine the petitioner and, afer asking petitioner

a question on a particular item, asked a question as follows:

“Q. So if Mr. Swaters were to make a statement

to that effect, that would be untrue?”

The defense objected and at a bench conference it ap-

pears that Mr. Swaters was not in Court, was not available

and was somewhere in Europe. The prosecutor then handed

petitioner some documents which were not identified to

see if they refreshed his recollection as to his conversations

with Mr. Swaters. Again the prosecutor commenced to

cross-examine petitioner from the transcript she had, and

after continuously objecting the Court ruled that the prose-

cutor was bound by petitioner's responses. Later on the

Court inquired of the prosecutor if the witness was in Court

and the prosecutor indicated that he was not but that she

had his statement. This was done in the presence of the

jury and appears in Volume 4 of the record commencing

at page 213.

REASONS FOR GRANTING THE WRIT

THE COURT OF APPEALS DISREGARDED A

STATUTORY ELEMENT IN AFFIRMING THE

TRIAL COURT AND THAT ELEMENT WAS

CRUCIAL TO THE DEFENSE; NAMELY, THAT

PETITIONER’S CONDUCT WAS “. . . WITH-

OUT REASONABLE CAUSE TO BELIEVE THE

TRUTH...”

It is fundamental that a defendant in a criminal case

is entitled to have the jury charged in such a manner that

the prosecution has the burden of proving defendant's

guilt beyond a reasonable doubt as to each element of the

offense. Curiously, the statute in the case at Bar requires

the prosecution to prove a negative; namely, that when

the defendant makes statements to customs that he did so

“, . . without reasonable cause to believe the truth of such

statements. . .” Admittedly, a negative may be difficult to

prove but it nevertheless appears in the statute and is thus

an element of the offense.

Notably, the indictment does not contain that lan-

guage and the instructions given by the Court to the jury

do not contain it. It appears only in the two instructions

tendered by the petitioner, which were refused. Both the

Trial Court and the Court of Appeals rationalized that

issue by holding that the culpable mental state required of

the defendant (willfullness) requires a higher degree of

proof than the statutory language, and the petitioner can-

not complain because the Government was under a higher

burden.

This begs the question: It is not important what judges

and lawyers think about what jury instructions mean, but

what twelve citizens understand them to mean. The word

“willful” to a lay person does not equate at all with the

words “. . . without reasonable cause to believe the truth

7

...” The defense could have argued to the jury at length

about the Government's failure to prove petitioner's lack

of belief, particularly in view of the Telexes from Swaters.

Interestingly enough, when Instructions 1 and 2 were ten-

dered neither the Government nor the Court stated that

they did not correctly state the law but simply ignored that

question.

The only case which we have found of any help is U.S.

v. Rose, 570 F. 2d 1358 (9th Cir., 1978) . That case sets out

the elements under the applicable statute and approved

jury instructions similar to those tendered by the petitioner.

The Trial Court and the Court of Appeals erred in chang-

ing the statutory elements of the offense in the charge to

the jury.

THE PROSECUTOR WAS GUILTY OF MISCON-

DUCT UNDER A.B.A. STANDARDS RELATING

TO THE ADMINISTRATION OF CRIMINAL

JUSTICE, THE PROSECUTION FUNCTION

5.7(d), DURING CROSS-EXAMINATION OF THE

PETITIONER.

Significantly, the prosecutor knew all the time that

Mr. Swaters was unavailable at trial. She had a transcript

of a statement taken by a Government investigator of Mr.

Swaters in Belgium, which she used to cross-examine the

petitioner. The Trial Judge correctly advised the prosecu-

tor that that transcript was inadmissible, even if properly

identified by the Government investigator. The prosecutor

contended that she thought it was admissible and, there-

frre, was not guilty of prosecutorial misconduct.

The appropriate Standard above cited is as follows:

“It is unprofessional conduct to ask a question

which implies the existence of a factual predicate

which the examiner knows he cannot support by evi-

dence.”

The Government's contention; namely, that the prosc-

cutor thought the transcript was admissible, is immaterial.

If the prosecutor does not know the rules of evidence, why

should the defendant suffer the consequences? Ignorance

of the law by a prosecutor is no more a defense to a charge

of prosecutorial misconduct than a defendant's ignorance

of the law is in a criminal case. The questions asked by the

prosecutor were clearly calculated to bring before the jury

the statements of the customs investigator who interviewed

the Belgian witnesses and, in fact, the prosecutor pointed

out in front of the jury that she had such a transcript.

Petitioner's repeated denials do no good at all to a lay

jury when the Assistant United States Attorney refers to a

transcript of a statement of a witness by a customs agent.

What good is it for the defendant to deny the statement?

What good is it for the Trial Court to tell the jury that

the Government is bound by the answers? The prosecutor's

good or bad faith is not an element in the above cited Stan-

dard. It is enough if the prosecutor knew that the factual

predicate could not be supported by the evidence and the

prosecutor is presumed to know the rules of evidence.

Similar situations have arisen in other circuits; for ex-

ample: U.S. v. Brown, 519 F. 2d 1368 (6th Cir., 1975) ;

U.S. v. Harris, 542 F. 2d 1283 (7th Cir., 1976) ; and U.S. v.

Bohle, 445 F. 2d 54 (7th Cir., 1971) . In these cases the pros-

ecutor’s conduct was grounds for reversible error.

If this matter related to a minor issue in the case it

would not be so important, but the nature of the agreement

between the petitioner and Mr. Swaters was the corner-

stone of the entire case. If, in fact, Swaters agreed to have

the cars conform to E.P.A. requirements, as a Telex indi-

cates, petitioner was not guilty as to the E.P. A. aspects of

the case. The Court's instruction to the jury that the Gov-

ernment was bound by defendant's answers was not only

incorrect but futile.

9

CONCLUSION

For the reasons set forth above, petitioner prays that

this petition for writ of certiorari be granted.

Respectfully submitted,

ALEX STEPHEN KELLER

KELLER, DUNIEVITZ &

JOHNSON

950 - 17th Street, Suite 1650

Denver, Colorado 80202

(303) 571-5302

Counsel of Record for Petitioner

A-l

SLIP OPINION

APPENDIX A

PUBLISH

UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

UNITED STATES OF AMERICA,

Plaintiff-A ppellee,

)

)

)

)

v. ) No. 79-1519

)

MARK FELSEN, )

)

)

Defendant-A ppellant.

Appeal from the United States District Court

for the District of Colorado

(D.C. No. 78-CR-396)

Alex Stephen Keller of Keller, Dunievitz & Johnson, Den-

ver, Colorado, for Defendant-Appellant.

Nancy E. Rice, Assistant United States Attorney (Joseph

Dolan, United States Attorney, with her on the brief) , Den-

ver, Colorado, for Plaintiff-Appellee.

Before SETH, Chief Judge, BARRETT, and SEYMOUR,

Circuit Judges.

SEYMOUR, Circuit Judge.

A-2

Defendant Mark Felsen was tried on four counts of

importing Ferrari automobiles by false statements in vio-

lation of 18 U.S.C, § 542. The jury acquitted on Counts II

and IV and convicted on Counts I and III, a conviction

that Felsen now appeals. We affirm.

Felsen was the president and manager of Ferrari Den-

ver, Ltd., a Colorado dealership engaged in importing Fer-

raris for resale in this country. In February 1978, Felsen

imported a 1977 Ferrari Berlinetta Boxer 512 (BB512),

Vehicle Identification Number (VIN) 23091. He bought

the BB512 from a seller in Belgium, having previously ar-

ranged to resell it to a buyer in Texas. Count I of the

indictme at charges that Felsen lied about this Ferrari both

on Customs entry documents and verbally to Customs offi-

cials as the port of entry. Specifically, although he stated

the VIN correctly, he misdesignated the BB512 model as a

model 308GTB and falsely stated the Ferrari was covered

by a Certificate of Conformity from the U., S$, Environmen-

tal Protection Agency (EPA) as required by 19 C.F.R.

§ 12.73. The EPA issues these certificates to automobile

manufacturers for models that comply with certain environ-

mental standards, See generally 40 C.F.R. § 86. In 1977,

the EPA had issued Certificates of Conformity only for

the Ferrari 308GTB and 308GTS models, and the Dino

3808GT4 2+2 model. At all times pertinent to this lawsuit,

the BB512 was not covered by an EPA Certificate of Con-

formity. The Ferrari manufacturer apparently believed

that it was economically impracticable to bring the BB512

into compliance with EPA emission standards.

In April 1978, Felsen imported from the same Bel-

gium seller another 1977 Ferrari, this one a 400 Automatic

with VIN 23557. Count III charges that Felsen lie? to Cus-

toms about this Ferrari as well. First, he called the 400

Automatic a “GT4 2+2,” a model nonexistent as such,

Second, he falsely stated that it was covered by an EPA

A-3

Certificate of Conformity and that it could be conformed

to Department of Transportation (DOT) standards by

modifying the automobile with “readily attachable equip-

ment items.’ 19 C.F.R. § 12.80(b)(2)(iv) (1978). Like the

BB512, the 400 Automatic has never been covered by an

EPA Certificate of Conformity. To achieve DOT compli-

ance would require a retrofit operation of roughly 24%

to 3 working days, assuming the parts for a 400 Automatic

were available in this country.

Felsen challenges his conviction on four grounds:

(1) The trial court erred in denying his motion

for judgment of acquittal based upon the Govern-

ment’s failure to prove the mental state element of the

crime in 18 U.S.C, § 542.

(2) The trial court erred in its jury instruction

on the scienter requirement of 18 U.S.C. § 542.

(3) The term “readily attachable equipment

items” in 19 C.F.R. § 12.80(b)(2)(iv) (1978), dealing

with DOT standards, is impermissibly vague.

(4) Prosecutorial misconduct in the cross-exami-

nation of Felsen was sufficiently prejudicial to warrant

a new trial.

These contentions are meritless.

I.

Denial of judgment of acquittal

To test the trial court’s denial of Felsen’s acquittal

motion, we must view the evidence most favorably to the

verdict and determine whether such evidence was sufficient

for a reasonable jury to infer guilt beyond a reasonable

doubt. See United States v. Walton, 552 F.2d 1354, 1366-67

A-4

(10th Cir.) , cert. denied, 431 U.S, 959 (1977). Our review

of the evidence establishes that the trial court’s refusal to

grant acquittal was not error.

18 U.S.C. § 542 prohibits the importation of goods by

false statements. It reads in pertinent part:

“Whoever enters or introduces, or attempts to

enter or introduce, into the commerce of the United

States any imported merchandise by means of any

fraudulent or false invoice, declaration, affidavit, let-

ter, paper, or by means of any false statement, written

or verbal, or by means of any false or fraudulent prac-

tice or appliance, or makes any false statement in any

declaration without reasonable cause to believe the

truth of such statement, . . .

“Shall be fined for each offense not more than

$5,000 or imprisoned not more than two years, or

both...”

Id.

In essence, Felsen’s defense at trial was that he lacked

the requisite mental state to commit any crime. He testified

that by agreement his Belgium seller was to take charge

over achieving EPA compliance for both Ferraris, while he

retained the burden of DOT compliance. Felsen was sur-

prised, so he testified, to learn that no EPA Certificate of

Conformity covered either the BB512 or the 400 Auto-

matic, Regarding what it would take to achieve DOT com-

pliance for the 400 Automatic, Felsen assertedly believed

that the necessary retrofit operation amounted to no more

than “readily attach[ing] equipment items” onto the auto-

mobile, as permitted by 19 C.F.R. § 12.80(b)(2)(iv) (1978).

The Government, however, introduced ample evi-

dence from which the jury could have concluded Felsen

A-5

had willfully’ made false statements in importing the 1977

BB512 and 400 Automatic. Felsen had several years’ expe-

rience as both a Ferrari dealer and mechanic. Due to this

experience, Felsen had little difficulty in telling Ferrari

models apart or spotting the difference between an 8-cylin-

der and a 12-cylinder engine. Felsen knew, for example,

that a model 308GTB had an 8-cylinder engine and a cost

of roughly $24,000 and that the BB512 model had a 12-

cylinder engine and a cost of $40,000. The Ferrari im-

ported in February 1978 was listed in the Customs entry

documents as having a VIN of 23091 and a cost of $40,000.

Felsen expressly told the Customs brokcr who prepared the

entry documents that the correct model for that Ferrari

was 308GTB, and that is how the documents were made

to read. Felsen also knew that although the EPA Certificate

of Conformity he supplied to the Customs broker covered

the 308GTB, it cid not cover the BB512. But from his

negotiations with the Belgium seller before the Ferrari en-

tered this country, Felsen knew the VIN 23091 actually

belonged to a BB512. He had contracted with the Texas

buyer to sell him a Ferrari BB512, VIN 23091. In attempt-

ing to finance his purchase and resale of the Ferrari, Felsen

submitted to his bank a letter of credit from the Texas

buyer’s bank and a manufacturer's certificate of origin,

both of which matched VIN 23091 to a BB512. Even after

Felsen had cleared the BB512 through Customs and had

delivered it to his Texas buyer, Felsen again called the

BB512 a 308GTB when he applied for a motor vehicle

title certificate.

From all this, a jury could have inferred beyond a rea-

sonable doubt that as an experienced Ferrari dealer and

mechanic Felsen intended all along to purchase and resell

‘Although 18 U.S.C, § 542 requires only that the importer be

“without reasonable cause to believe the truth” of his statements

to Customs, the Government at trial voluntarily undertook to

show Felsen had acted willfully.

A-6

a BB512, that he knew the BB512 was not covered by an

EPA Certificate of Conformity, and that he deliberately

misdesignated it a 308GTB to slip the noncompliant BB512

past Customs.

Regarding what Felsen knew about the 400 Automatic

imported in April 1978, the Government's proof showed

the following. Like the BB512, Felsen purchased this Fer-

rari from the same Belgium seller by VIN 23557. This VIN

appeared in the Customs entry documents. The model,

however, was shown as “GT4 2+2.” By itself, this designa-

tion does not meaningfully point to any single Ferrari

model. Something more is needed, like “308GT4 2+2” or

“365GT4 2+2,” to make a bona fide Ferrari model out of

the characters “GT4 2+2.” According to expert testimony,

all 1977 models having the core characters “GT4 2+2”

differ significantly from the 400 Automatic, differences

that a jury might reasonably infer would be readily dis-

cernible to an experienced Ferrari dealer and mechanic

such as Felsen.

Regarding EPA compliance, the 400 Automatic stood

on equal ground with the BB512. The EPA Certificate of

Conformity that Felsen supplied to his Customs broker for

inclusion in the entry documents failed to list either. And

according to expert testimony, any attempt to modify the

400 Automatic into EPA compliance would involve the

same degree of impracticability as the BB512. Neverthe-

less, during the Customs inspection at the port of entry,

Felsen pointed out certain equipment items that pur-

portedly conformed the 400 Automatic to EPA standards.

In view of Felsen’s expertise as a mechanic, the jury could

reasonably infer he was deliberately trying to mislead the

Customs inspectors regarding EPA compliance.

With respect to DOT compliance, the Customs Inspec-

tor testified he asked Felsen if he had the “readily attach-

able” parts required by 19 C.F.R. § 12.80, and Felsen said

A-7

he did. But according to expert testimony no such parts

were available for a 400 Automatic in this country. Even as-

suming they were, DOT compliance would require a sig-

nificant retrofit operation of 2Y% to 3 working days.

There is additional telling evidence that Felsen’s false

statements about the 400 Automatic in the Customs entry

documents were not innocent. The Customs inspection re-

vealed that the automobile decals identifying the Ferrari as

a 400 Automatic had been removed and the holes covered.

Also, heavy black tape covered the logo “400 Automatic”

on the VIN plate, leaving only the VIN numerals visible.

The above evidence, when viewed together and in

context, is ample to support a jury finding that rather than

being a product of innocent mistake, Felsen’s false state-

ments were meant to end-run EPA and DOT regulations in

order to slip the 400 Automatic past Customs.

The jury charge

18 U.S.C. § 542 does not impose strict criminal liabil-

ity for false statements made when goods are imported into

this country. Section 542 requires that the declarant state

the falsehood “without reasonable cause to believe” its

truth. Jd, Felsen proferred two jury instructions that tracked

this language.’ The trial court instead charged that the Gov-

? The first says that to establish the offense, the Government had

to prove four elements:

“(1) That the Defendant at the time charged did introduce or

attempt to introduce into the commerce of the United States

the vehicle described in the particular count;

(2) By means of a fraudulent or false invoice, declaration, affi-

davit, letter, paper or by means of a false statement written

or verbal;

(3) That he did these acts willfully, and

(4) That he did so without reasonable cause to believe the

truth of such statements.”

A8

ernment had to prove Felsen “knowingly did an act which

the law forbids, purposely intending to violate the law.”

Rec., vol. VI, at 12-13.° This was consistent with the “will-

fulness” burden the Government voluntarily assumed at

trial. See note 1 supra. Felsen claims, however, that the trial

Rec., vol I, at 23.

The second instruction reads in full:

“One of the essential elements that the prosecution

must prove beyond a reasonable doubt is that the Defendant

acted without reasonable cause to believe the truth of any

statement he may have made. If there is a reasonable doubt

as to whether or not the Defandant acted without reasonable

cause to believe the truth of any statement, then the verdict

must be not guilty.”

Rec., vol I, at 24.

°More fully, the instruction reads:

“The crime charged in this case is a serious crime which

requires proof of specific intent before the Defendant can

be convicted. Specific intent as the term implies means more

than the general intent to commit the act.

“To establish specific intent, the Government must

rove that the Defendant knowingly did an act which the

aw forbids, purposely intending to violate the law. Such

intent may be determined from all of the facts and cir-

cumstances surrounding the case.

“An act or failure to act is knowingly done if done vol-

untarily and intentionally and not because of mistake or ac-

cident or other innocent reason.

“The word false must be considered with the words

knowingly and willfully. As I have said, an act is done

knowingly if done voluntarily and intentionally and not

because of mistake or accident or other innocent reason.

“An act is done willfully if done voluntarily and in-

tentionally and with the specific intent to do something the

law forbids, that is to say with bad purpose either to disobey

or to disregard the law.

“The word knowingly is added to ensure that no one

would be convicted who made or caused to be a statement

or representation which was false because of mistake or

accident or other innocent reason.

“If you find that the accused did not knowingly and

willfully make any false statements or cause any to be made,

you should acquit the accused.”

Rec., vol. VI, at 12-13.

A-9

judge erred by refusing to give, in haec verba, his “without

reasonable cause” instructions. He argues that the statute’s

language requires the Government to prove a negative, a

burden more onerous than proof of a positive, which the

“knowingly” charge imposed. As a result, Felsen contends,

the Government was impermissibly relieved of a burden

that section 542 imposes. This is nonsense. One who states

a falsehood knowingly cannot at the same time do so with a

reasonable belief of its truth.

Both Felsen and the Government recognize that fail-

ure to instruct the jury on a theory of defense, when the

evidence supports the theory, is reversible error. See Speers

v. United States, 387 F.2d 698, 702 (10th Cir. 1967), cert.

denied, 391 U.S. 956 (1968). And the parties do not dis-

pute the meaning of the statute’s elements. See, e.g., United

States v. Rose, 570 F.2d 1358, 1363 (9th Cir. 1978). The

Government argues, and we agree, that the instruction ac-

tually given imposed a tougher burden on the Government

and was thus harmless error under Fed. R. Crim. P. 52(a).

See United States v. Johnson, 462 F.2d 423, 427 (3d Cir.

1972) (charge placing additional burden on Government

regarding scienter held harmless error), cert. denied, 410

U.S. 937 (1973) ; cf. Lopez v. United States, 406 F.2d 903,

905 (5th Cir. 1969) (imposing “beyond reasonable doubt”

standard where statute required only “preponderance of

evidence” standard held harmless error) .

Il.

The term “readily attachable equipment items”

Count III of the indictment relates to the 400 Auto-

matic. In addition to falsely designating it as a “GT4 2+2”

and falsely stating it complied with EPA standards, Felsen

submitted DOT Form HS-7. He checked Box 4, thereby

declaring that the 400 Automatic did not meet all DOT

A-10

requirements but that compliance could be achieved by

attaching to the auto “readily attachable equipment items.”

This phrase appears in the Government’s bill of particulars

as well as in 19 C.F.R. § 12.80(b)(2)(iv) (1978). Section

12.80(a) says no vehicle may be imported into this country

unless the importer makes one of several declarations. By

checking Box 4 on Form HS-7, Felsen made this one:

“The merchandise consists of new vehicles being im-

ported for purposes of resale, and such vehicles do not

presently conform to all applicable Federal Motor Ve-

hicle Safety Standards because readily attachable equip-

ment items are not attached, but there is affixed to the

windshield of each vehicle a label stating the standard

with which and the manner in which the vehicle does

not conform and that the vehicle will be brought into

conformity by attachment of such equipment items

before it is offered for sale to the first purchaser for

purposes other than resale.” (Emphasis added) .*

After citing hornbook law concerning due process re-

quirements for properly apprising a defendant of the crime

charged, see, e.g., Bowie v. Columbia, 378 U.S. 347, 351

(1964) (statutory language) ; United States v. Mersky, 361

U.S. 431, 440-41 (1960) (imposing same definiteness re-

quirements for regulations as for statutes) ; United States v.

Radetshy, 535 F.2d 556, 562 (10th Cir.) (language in in-

419 C.F.R. § 12.80(b) (2) (iv) (1978) itself says that the importer

must declare:

“Such vehicle is a new vehicle being imported for purposes

of resale which does not presently conform to all applicable

safety standards because readily attachable equipment items

are not attached, but that there is affixed to its windshield

a label stating the standard with which and the manner in

which such vehicle does not conform and that the vehicle

will be brought into gage oy by attachment of such

equipment items before it will be offered for sale to the

first purchaser for purposes other than resale... .”

A-11

dictment) , cert. denied, 429 U.S. 820 (1976) , Felsen argues

that the term “readily attachable” fails under the Due

Process Clause for vagueness, and that therefore the part

of Count III on DOT requirements should have been dis-

missed. Felsen contends that even though something may

not be “readily attachable” to a $5,000 Ford, it may well

be considered ‘readily attachable” to a $40,000 Ferrari.

Admittedly, “readily attachable equipment items’ is no-

where officially defined or judicially construed, but that

does not automatically render the term void for vagueness.

In United States v. National Dairy Products Corp., 372

U.S. 29, 33-34 (1963), the Supreme Court held that sec-

tion 3 of the Robinson-Patman Act making it a crime to sell

goods as “unreasonably low prices” to destroy or eliminate

competition is not unduly vague. The Court said the chal-

lenged statutory language must be viewed in context with

the conduct sought to be proscribed.

Here, the law conditions a vehicle’s entry into this

country upon its compliance with DOT requirements. See

19 C.F.R. § 12.80(a). The “readily attachable” rubric is an

exception to avoid requiring hypertechnical compliance. In

context, the designation is not impermissibly vague. Rea-

sonably facile compliance is contemplated by a less-than-

significant attachment of equipment items to the entering

automobile. Thus, for example, it would make little sense

to refuse entry to an auto that comes to a port of entry

without a required rearview mirror since the mirror could

be readily attached here. Even assuming close cases might

arise under the “readily attachable” terminology, Felsen’s

case is not one of them. Achieving DOT compliance for

the 400 Automatic required a significant retrofit operation.

The proof showed that if parts were available at all, they

were not available in this country. Yet Felsen, who was per-

mitted to freely scrutinize the 400 Automatic during the

Customs inspection and thereby to recognize the 400 model,

A-12

told Customs officials he had the parts required for DOT

compliance. Even if parts were available, the labor for the

retrofit operation to attach the parts was estimated (by

comparison to.a related model) at 24% to 3 working days.

From the evidence in this case, the jury could reasonably

infer a deliberate effort on Felsen’s part to frustrate the

purpose of the “readily attachable’’ exception.

IV.

_ Prosecutorial misconduct

The thrust of Felsen’s defense was that he did ‘not lie

to Customs about EPA requirements because he honestly

believed his seller in Belgium, a Mr. Jacques Swaters,

would take care of EPA compliance as agreed. On direct

examination, Felsen testified about the details of this ar-

rangement and about statements allegedly made by Swat-

ers. Swaters was never produced as a witness at trial. How-

ever, the Government had a customs agent obtain a sworn

statement from Swaters which apparently contradicted Fel-

sen. Hampered by Swaters’ absence as a witness, the prose-

cutor decided to use Swaters’ sworn statement, as well as

the Customs agent’s written report of his interview with

Swaters, in cross-examining Felsen about statements Felsen

had attributed to Swaters. Defense counsel objected to this

procedure on the grounds that the Government could not

produce Swaters and that the jury would infer the ques-

tions were properly based on an official document.

The trial court sustained the objections. At one point,

the judge ordered a question by the prosecutor based on

Swaters’ statement stricken, and admonished the jury to

disregard it. In response to defense counsel's objection that

the jury could draw improper inferences from the prose-

cutor’s use of the documents, the judge instructed the jury

that unless the Government could produce Swaters, it was

A-13

bound by Felsen’s answers. When the same objection was

made regarding the Government's use of a statement by an-

other person who did not testify, the trial court stated in

front of the jury that the statement did “not mean any-

thing.” Rec., vol. V, at 232. At no time did defense counsel

move for a mistrial on these grounds or ask for further

curative instructions.

On appeal, Felsen argues that the Government's at-

tempted use of the written statements was so prejudicial

that the damage could not be cured. We disagree. On this

record, we believe any prejudice to defendant which may

have resulted from the procedure was rendered harmless

by the court's instructions. See Fed. R. Crim. P. 52(a). This

is not a case in which the Government was unprepared to

prove the facts underlying its cross-examination. See, ¢.g.,

United States v. Brown, 519 F.2d 1368, 1370 (6th Cir. 1975)

(Government conceded the questions had no factual basis).

The record supports the inference that the prosecutor had

what she believed to be admissible evidence upon which

to base her cross-examination of Felsen, namely Swaters’

sworn statement and the customs agent who interviewed

him. She was prepared to call the customs agent but the

trial court refused to allow him to testify. Once the court

made clear outside the hearing of the jury that the state-

ments and the witness’ testimony would not be admitted,

the prosecutor did not pursue this line of questions further.

We find no prosecutorial impropriety necessitating reversal.

Affirmed.

B-1

APPENDIX B

MAY TERM ~ June 3, 1981

Before Honorable Oliver Seth, Honorable James E. Bar-

rett and Honorable Stephanie K. Seymour, Circuit Judges.

UNITED STATES OF AMERICA, _ )

Plaintiff-A ppellee,

No. 79-1519

v.

MARK FELSEN,

— Eee ee ee

Defendant-A ppellant. )

This matter comes on for consideration of appellant's

petition for rehearing filed in the captioned cause.

Upon consideration whereof, the petition for rehear-

ing is denied.

HOWARD K. PHILLIPS, Clerk

By

Robert L. Hoecker

Chief Deputy Clerk

C-1

APPENDIX C

MAY TERM — June 16, 1981

Before Honorable Oliver Seth, Honorable James E. Bar-

rett and Honorable Stephanie K. Seymour.

UNITED STATES OF AMERICA,

Plaintiff-A ppellee,

)

)

)

) No. 79-1519

v. )

MARK FELSEN, )

)

Defendant-Appellant. )

This matter comes on for consideration of appellant's

motion for stay of mandate in the captioned cause pending

timely application to the Supreme Court for certiorari.

Upon consideration whereof, the motion for stay of

mandate is granted. The mandate shall be stayed until July

16, 1981, pending certiorari, and that if on or before that

date there is filed with the Clerk of the Court of Appeals

a notice from the Clerk of the Supreme Court of the United

States that appellant has timely filed a petition for writ of

certiorari in the Supreme Court, the stay shall continue

until final disposition by the Supreme Court.

HOWARD K. PHILLIPS, Clerk

By

Robert L. Hoecker

Chief Deputy Clerk

D-|

APPENDIX D

uc

DPLM

VIA WUI 0541 01/21

22777 FRAMPS B

TLX 141x = 21-02-1978

ATT MR FELSEN

HOPE YOU HAD A GOOD TRIP BACK AND EVERY-

THING OK.

1) GTB, GTS AND SPARE PARTS WILL LEAVE ON

PAN AM FLIGHT NR 167 FRIDAY.

2) TOTAL AMOUNT SPARE PARTS ORDER: 7.160

US DOLLARS. ADVISE AN HOW AND WHEN TO

SHIP.

8) CHASSIS WITH 400 AUT. TRANS NR 23557 AR-

RIVING BRUSSELS FRIDAY 24TH. MAY BE AIR

FREIGHT WITH THE YELLOW GTS AND BB

ANY DAY ON PAN AM 167 FROM BRUSSELS TO

CHICAGO AND ON US M-193 FROM CHICAGO

TO DENVER. NEED URGENT CONFIRMATION.

SALDO DUE:

400 AUT TRANS = 37.500

SPARE PARTS 7.160

YELLOW GTS 24.475 (AIR COND” SPOILER)

69.135

25.300

44.135

PLEASE TRANSFER SAME WAY THROUGH SA

BANQUE BRUXELLES LAMBERT.

BEST REGARDS

J SWATERS

22777 FRAMPS E

16 ofp

FERRARI DVR

FOR INTL TELEX DIAL 121 — CABLEGRAMS 6481

00

D-2

APPENDIX D

VIA WUI 0935 05/02

FERRARI DVR

22777 FRAMPS B

TLX N 285 02/05/08

ATT. MR FELSEN

WE DO NOT THINK YOU SHOULD BE HAVING

ANY TROUBLE WITH THE CARS THAT WE SOLD

YOU. WE MODIFIED EACH ENGINE AND TUNED

TO CONFORM WITH YOUR EPA LAWS. WE DO

NOT KNOW IF THESE WILL BE OK IN DENVER

BECAUSE OF THE MILE HIGH BUT SHOULD BE

OK AT THE SEA LEVEL. WE WILL SEND YOU A

LIST OF SPARES THAT WE USED TO MODIFY BY

POST VERY SOON.

BEST REGARDS

JACQUES SWATERS

GARAGE FRANCORCHAMPS

22777 FRAMPS B

“ a

FERRARI DVR

FOR INTL TELEX DIAL 101 — CABLEGRAM 6481

0

E-l

APPENDIX E

Defendant's Proposed Instruction No. 1

U.S.A. v. Felsen

Case No. 78-CR-396

The essential elements required to be proved in order

to establish the offense charged in each and every cpunt of

the indictment are as follows:

(1) That the Defendant at the time charged did intro-

duce or attempt to introduce into the commerce of the

United States the vehicle described in the particular count;

(2) By means of a fraudulent or false invoice, declara-

tion, affidavit, letter, paper or by means of a false statement

written or verbal;

(3) That he did these acts wilfully, and

(4) that he did so without reasonable cause to believe

the truth of such statements.

All of these elements are essential for each of the four

counts charged. The burden is always upon the prosecu-

tion to prove beyond a reasonable doubt each and every

essential element of the crime charged. The law never im-

poses upon a Defendant the burden or duty of calling any

witness or producing any evidence.

Devitt and Blackmar, Federal Jury Practice and Instrue-

tions, Third Edition, 1977, 13:04.

Gorin v. United States, 312 U.S. 19, 61 S. Ct. 429, 85 L

Ed. 488.

United States v. Achtenberg, 459 F 2d 91, 96 (8th Cir. 1972)

cert. denied 409 U.S. 932.

United States v. Rose, 570 F 2d 1358 (9th Cir.) .

E-2

APPENDIX E

Defendant's Proposed Instruction No. 2

U.S.A. v. Felsen

Case No. 78-CR-396

One of the essential elements that the prosecution must

prove beyond a reasonable doubt is that the Defendant

acted without reasonable cause to believe the truth of any

statement he may have made. If there is a reasonable doubt

as to whether or not the Defendant acted without reason-

able cause to believe the truth of any statement, then the

vertdict must be not guilty.

Devitt and Blackmar, Federal Jury Practice and Instruc-

tions, Third Edition, 1977, 13:04.

Gorin v. United States, 312 U. S. 19, 61 S. Ct. 429, 85 L

Ed. 488.

United States v. Achtenberg, 459 F 2d 91, 96 (8th Cir. 1972)

cert. denied 409 U. S. 932.

United States v. Rose, 570 F 2d 1358. (9th Cir.) .