Appendix — Cothran v. United States

-15-

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

“No. 75-5317

United States of America, Appellee,

Vv.

James W. Cothran, Jr., Appellant.

“NO. 795-5310

United States of America, Appellee,

Vv.

A. Frank Harrison, III, M.D., Appellant.

“NO. 79-5326

United States of America, Appellee,

Vv.

James F. Johnson, Appellant.

United States of America, 3 Appellee,

Vv.

Bobby Richardson, Appellant.

eas wt,

United States of America, Appellee,

Vv.

Leon Cooper, Appeliant.

Appeal from the United States District Court

for the District of South Carolina, at Colum-

bia. Robert F. Chapman, District Judge.

Argued November 6, 1981

Decided June 10, 1982

Before BUTZNER, Circuit Judge, FIELD, Senior

Circuit Judge, and MURNAGHAN, Circuit Judge.

Herbert W. Louthian (Thomas P. Cothran on

brief) for Appellant Cothran; John R. Lester

for Appellant Cooper; Daphne Sipes (J. Edward

‘Holler on brief) for Appellant Johnson; Robert

C. Elliot for Appellant Richardson; Thornton

H. Brooks (George W. House on brief) for

Appellant Harrison; (Mitchell Willoughby,

Robert E. Kneece on brief) for Appellant

Harrison; Thomas P. Simpson, Assistant United

States Attorney (Henry Dargan McMaster,

United States Attorney, Marvin J. Caughman,

Assistant United States Attorney, Lester L.

Bates, III, Third Year Law Student on brief)

for Appellee.

‘

med

ws a = ss

po

-18-

MURNAGHAN, Circuit Judge:

James W. Cothran, Jr., A. Frank

Harrison, III, M.D., James F. Johnson, Bobby

Richardson, and J.eon Cooper appeal their

convictions for mail fraud violations under

18 U.S.c. §13411 on various grounds.

1 18 U.S.C. §1341 provides:

Whoever, having devised or intending

to devise any scheme or artifice to defraud,

or for obtaining money or property by means

of false or fraudulent pretenses, represen-

tations, or promises, or to sell, dispose

of, loan, exchange, alter, give away, dis-

tribute, sup °, or furnish or procure for

unlawful use any counterfeit or spurious

coin, obligation, security, or other

article, or anything represented to be or

intimated or held out to be such counter-

feit or spurious article, for the purpose

of executing such scheme or artifice or

attempting so to do, places in any post

office or authorized depository for mail

matter, any matter or thing whatever to be

sent or delivered the Postal Service, or

takes or receives refrom, any such matter

or thing, or knowingly causes to be deliver-

ed by mail according to the djirection there-

on, or at the place at which it is directed

to be delivered by the person to whom it is

addressed, any such matter or thing, shall

be fined not more than $1,000 or imprisoned

not more than five years, or both.

-19-

The government proceeded at trial

against the five defendants by alleging a mail

fraud scheme whereby attorney Cothran would

submit false or inflated insurance claims on

behalf of purported automobile accident vic-

tims who in fact suffered minor injuries at

all, or were not actually inyolved in an

accident.” On the victim's behalf, Cothran

would file relatively small claims for damages,

generally basing them on neck and back, or

whiplash injuries. To succeed, he needed two

types of assistance: (a) runners, or a referral

service, and (b) at least one phyisician.

One referral source was made up of

runners, among them co-defendant Bobby

Richardson, who operated out of Cothran's 4

office, all of whom also set up wrecks.

2 The indictment consisted of twenty

counts, each of which was based upon a

separate traffic accident or purported

accident.

3 4

Wrecker service operators” and drivers con-

stituted a second source of clientele for

Cothran. Also, a former Columbia, South

Carolina, police officer admitted receiving

several hundred dollars in bribes in return

for referrals to Cothran. Johnson, too, relied

upon a referral system based upon bribery of

police officers.

From-the physician, co-defendant A.

Frank Harrison, III, Cothran needed and

received curesory examinations of his clients

who were diagnosed usually as suffering neck

and back pain, injured or not. Harrison's

medical reports predicted continuing physical

problems for the accident victims in order to

increase the settlement value of their claims.

3 Such was the status of co-defendant

James F. Johnson.

4 Co-defendant Leon Cooper was a tow-

truck driver for Johnson's wrecker service.

@21<

Purther exacerbating the doctor's role was

Cothran's instruction to his clients to meet

as many appointments with Harrison or other

physicians as possible. Dr. Harrison complied

with this tactic and billed for services even

though the patients on occasion did not show up.

The requisite mailings to make out

violations of the statute were proven through

the testimony of insruance adjusters, who

identified specific mailings by Cothran, or

by insurance agents who testified that certain

documents were mailed in furtherance of the

scheme.

The defendants, employing an appreach

not infrequently encountered, now raise a

plethora, amounting to twenty, of separate

arguments why their convictions should be

reversed and judgment entered in their favor

or a new trial ordered.

I. Jury Selection

Pirst, they contend that the trial

court erred in ordering the jury venire list

a.

sealed until the day of the trial. Extensive

publicity preceded the trial on account of

the number of insurance companies defrauded

and the scope of the scheme alleged. Cothran

and Harrison were elected members of the Rich-

iand County Council. The background of the

other defendants varied. Numerous witnesses

were to testify for the prosecution. In light

of those facts, the defendants maintain that

they should have been permitted to examine

the prospective jury list so that a fair

supplementation of the trial judge's voir dire

questions could have been made. They assert

that the interests of justice did not require

the sealing of the list; that they were denied

a fair and impartial trial in having no knowl-

edge, prior to the jury selection, of the

section of the community that each juror repre-

sented; that there had been inadequate time in

which to determine particular voir dire ques-

tions as to each juror; and that, in sum, the

decision to seal the jury list was arbitrary

-23-

and unjustified. In particular the defendants

object to the lessened opportunity for them

to employ the services of a psychologist

retained by them to assit in assessment of

prospective jurors.

The defendants have made no asser-

tions of particular disqualifications of

individual prospective jurors. A fortiori,

they have set forth no such disqualifications

which would not have been reasonably discover-

able by the voir dire which the district court

conducted. The district judge invited

adéitional inquiries by the defendants as to

particular areas of concern when, on the open-

ing day of the trial, he unsealed the venire

list and conducted voir dire.

Section 1863(b) (7) of Title 28,

United States Code, vests the district court

with wide discretion to keep the jury list

confidential “where the interests of justice so

require.” In challenging action taken pursuant

to section 1863(b) (7), court's decision.”

United States v. Tucker, 526 F.2d 279, 283

(Sth Cir. 1976), cert. denied, 425 U.S. 958

(1976); United States v. Stokes, 506 F.2d 771,

777 (5th Cir. 1975).

The district judge directed extensive

voir dire questions to the prospective jurors.

The court also posed additional questions that

the defense counsel wished to have asked. The

court expressed especial concern wita the pre-

trial publicity. Obviously, prospective jurors

in a case with political overtones, attracting

widespread public attention, may potentially

be subjected to pressures detracting from their

capacities to provide fair and impartial service

as jurors. Certainly the defendants would

have preferred to have seen the jury list

earlier, but such an unfulfilled, general desire

does not evidence an abuse of discretion by the

trial judge. Stone v. United States, 324 F.2d

804, 806-807 (Sth Cir. 1963), cert. denied, 376

U.S. 938 (1964) ("We find no error in the

record, and no abuse of discretion in the. .

s ‘i “

-25-

court's refusal to permit access to the jury

list prior to the the day of the trial .. .").

The defendants next argued that the

trial court erred in not permitting conduct of

the examination of prospective jurors by the

defendants on an individual and collective

basis. The district judge preferred to put

the voir dire questions over the manner in

which voir dire is conducted. Ham v. South

Carolina, 409 U.S. 524, 527 (1973). The defen-

dants complain that their counsel were not

permitted to examine the prospective jurors,

but no abuse of discretion inheres in the

refusal to allow counsel personally to conduct

the voir dire. United States v. Duncan, 598

F.2d 839, 865 N.25 (4th Cir. 1979), cert.

denied, 444 U.S. 871 (1979) ("The refusal to

allow counsel to conduct that voir dire cannot

be described as an abuse of that discretion.").

Neither is there any error in the

trial court's refesal to inquire of each

prospective juror, separately, whether he knew

-26-

any of the over two hundred prospective

witnesses in the case.

Had a request been made that, for

the purpose of ferreting out any personal

acgquaintanceships, the prospective jurors

collectively hear the names on the witness

list, possibly a closer question might have

been presented. Then but one reading of the

list, rather than a repetition of the list for

each ofthe prospective jurors, would have been

required. Obviously the burden on the judicial

system would have been somewhat less. We do

not mean, however, to suggest that there would

then have been, in that case, an obligation on

the district judge to read the witness list.

We emphasize that a question of that nature is

not before us, since the defendants did not

ask for a collective presentation of the

question. We merely express our conclusion

that it was not an abuse of discretion to

refuse on voir dire to put the entire list of

over two hundred prospective witnesses

o2J<

separate to each potential juror.

The defendants, in protesting the

failure to inquire about personal acquaintance

in the only way that they asked the district

judge to prceed, do not suggest that any juror

was subject to an influence which adversely

affected his impartiality. Rather, the defen-

dants assert that the court's failure to make

the desired inquiry reduce the meaningfulness

of the peremptory challenges available to them.

It must be pointed our, however, that the trial

court, at times assisted by defense counsel

conducted an extensive voir dire. The question-

ing provided more than "some surface informa-

tion tion about prospective jurors." Cf. United

States v. Baldwin, 607 F.2d 1295, 1297 (9th

Cir. 1979). Here the court conducted a voir

dire of sufficient scope to insure that the

poss ible prejudices of each juror were tested.

Nothing in the voir dire suggests that it “was

so unreasonable as to constitute an abuse of

discretion." Id.

-28-

The trial court increased to fifteen

(15) the number of peremptory challenges avail-

able to the defendants. The challenges were

to be exercised separately, so that each defen-

dant had three (3) challenges at his disposal.

The trial court, however, went further and

instructed the defense counsel that they could

not collaborate on the use of the individual

challenges. Indeed, he called them co task

for apparently employing "a secret code" to

coordinate the peremptory challenges. The

government maintains that, in electing to

exercise the challenges individually, the

defendants forfeited any right to consultation

on the matter. We cannot agree that Rule 24(b)

commands such a result.

The Rule reads, in relevant part:

If there is more than one defen-

dant, the court may allow the .

defendants additional peremptory

challenges and permit them to be

exercised separately or jointly.

Fed. R. Crim. P. 24(b). We read the language

“separate or jointly" to mean that the final

-29-

say on whether a particular juror is to be

accpeted or excused rests either with a single

defendant or with all defendants collectively.

In this case, a single defendant had the power

to deny three prospective jurors a seat on the

panel regardless of whether any of his co-de-

fendants may have wished to seat them. The

defendants selected that mode of exercising

thier challenges because, in part, of possible

conflicts between the types of persons they

might want on the final panel. Decision as to

how to exercise the peremptory challenges and

exercise itself are, however, two quite

different things. In making their separate

decisions, the defendants probably should not

have been prevented from soliciting each other's

opinions or the opinions of each other's coun-

sel. Rule 24(b) refers, however, only to

entitlement to peremptory challenges, not to

the manner in which entitlement is to be

exercised. We believe the trial court's bar of

the secret code was not a denial or impairment

-30-

of the right to challenge the jurors individ-

ually as the defendants had elected to do.

Consequently, no occasion for reversal exists.

See Swain v. Alabama 380 U.S. 202, 219 (1965).

The defendants next complain that

the trial court failed to excuse a particular

venireman for cause and that the defendants

were thereby prevented from an uncontrolled use

of their peremptory challenges. The prospec-

tive juror was challenged peremptorily by

counsel for defendant Cothran and, consequently,

was excused. Counsel for defendant Cothran

used only two of his three peremptory challenges

during the entire jury selection process.

Thus, it is unnecessary to discuss the

propriety of the trial judge's refusal to

strike the juror for cause. Even were such

refusal to constitute error (a matter which we

have no occasion to decide, and do not decide),

it would amount to only harmless error. The

failure to exercise all available peremptory

challenges defeats any claim of prejudice.

. ae a ae

-3l-

Hopt v. Utah, 120 U.S. 430, 436 (1887)

("Notwithstanding the peremptory challenges

made by the defendant to two of the jurors, he

had several such challenges which had not been

used when the jury was completed. If, there-

fore, the ruling of the court in disallowing

the challenges to the two for bias, actual or

implied, was erroneous, no injury to the

defendant followed."), approved in Spies v.

Illinois, 123 U.S. 131, 168 (1887), and

Stroud v. United States, 251, U.S. 15, 21

(1919). See United States v. Rucker, 557 F.2d

1046, 1049 (4th Cir. 1977) (". . . the defen-

dant in that case did not use his peremptory

challenges to strike the veniremen in question.”).

II. Evidenti Hear and Rulings

The defendants’ fifth allegation of

error concerns the pre-trial hearing at which

documents from insurance company files were

identified. The defendants contend that the

trial court made inconsistent and contradictory

rulings as to the admissibility of evidence.

Contrary to the defendants’ assertions, no

document was admitted into evidence that day.

The hearing was purely for the purpose of

establishing custody of the documents. Defense

counsel were afforded adequate time in which

to view the documents. The ministerial em-

ployees who tesified were subject to cross-

examination by the defense, and were subject

later to subpoena by the defendant. Indeed,

the trial court was quite solicitous of the

defendants with regard to the documents. The

defendants* complaints are unsupported by the

record; the allegation of error, groundless.

Defendant Harrison has subpoenaed

his secretary, Dot Raven, as a witness on his

behalf. Counsel for Harrison and for the

government stipulated as to what the testimony

of Raven would have been, However, the trial

court sustained an objection to the stipulated

-33-

testimony made by counsel for Cothran.>

Her

availability on emotional grounds to appear

in person to testify was in question. Conse-

quently, a hearing concerning Raven's emotional

condition was necessitated. The defendants

now complain that the hearing was held ex

parte and in camera and, therefore, in a manner

“which violated the fundamental due process

notion of fairness to all litigants." The

hearing was neither ex parte nor in camera.

No due process violation occurred.

"Ex Parte means that an application

is made by one party to a proceeding in the

absence of the other.” United States v. Meri-

wether, 486 F.2d 498, 506 (Sth Cir. 1973), cert.

denied, 417U.S. 948 (1974). Both adverse

parties were present at the hearing. Only

5 That ruling was unexceptionable, for

the stipulation, not joined by Cothran, was

inadmissible hearsay as to Cothran. Admit-

ted over his obj , the stipulation

would have denied Cothran the valued right

of cross-examination. See Barber v. Page

390 U.S. 719, 721 (1968).

Harrison had subpoenaed Raven. He and his

counsel, as well as counsel for the government,

attended. In any event, a subpoena is, by its

very nature, an ex parte proceeding. See Ted.

R. Crim. Proc. 17. The testimony of the

physician, Dr. Huggins, concerning Raven's

inability to testify lasted two minutes and

was taken in open court before the official

court reporter. It is a misperception to

characterize what happened as in camera. "A

case is said to be held in camera either when

the hearing is had before the judge in his

private room or when all spectators are

excluded from the courtroom." Black's Law

Dictionary, 892 (4th ed. 1957). None of the

other defendants had ever subpoenaed Raven or

objected to the absence of her testimony.

Harrison alone assets prejudice because she

did not testify and inasmuch as her stipulation

was not admitted into evidence. Yet Harrison

was present and represented throughout so no

prejudice, ex parte or in camera. can be said

-35-

to have been suffered by him.

The defendants next asset partially

toward the government by the trial judge.

They ground their claim of error on a series

of questions and ruling made by the court

during the trial. The defendants maintain that

"the cumulative effect of the conduct of the

trial judge .. . was so prejudicial in favor

of the government as to deprive the Appellants

of a fair trial.” They further asset that,

through his "interference," the trial judge

assumed the role of a prosecuting attorney.

We have considered the charges and conclude

that they border on the irresponsible and that

no error has occurred. A review of the record

reveals that the trial judge, in his questions

and statements, was attempting to move the trial

alone and to clarify the questions to and the

answers by the witnesses. The trial judge

"should not hesitate to ask questions for the

purpose of developing the facts; and it is no

ground of complaint that the facts so developed

-36-

may hurt or help one side or the other.” Simon

v. United States, 123 D.2d 80, 83 (4th Cir.

1941), cert. denied. 314 U.S. 694 (1941);

United States v. Pomponio, 563 F.2d 659, 6€7

(4th Cir. 1977), cert. denied, 435 U.S. 942

(1978). Wo badgering, no harassment, of

witnesses or of the defense, occurred. In-

deed, the judge conducted this trial well with-

in the realm of judicial propriety. Defendants‘

seventh allegation of error must fail.

Defendant Cothran objects to the

admission of the testimony of John Robert Morris,

a wrecker service operator, who stated that

Cothran had approached him in an attempt to

persuafe him to send automobile accident victims

to Cothran. Cothran seems to believe that the

introduction of the testimony amounted to a

trial for activities for which he had not been

indicted. His entire argument focuses on the

failure of the indictment to charge any com-

plicity with the witness. The focus is mis-

placed.

-37-

The indictment charged that the

defendants ‘devised and intended to devise a

scheme and artifice to defraud numerous :

insurance companies by causing the ciling, ~~

through the use ot the United States Mail, of

ciLaims on behalf of numerous persons who had

allegedly been injured in automobile accidents,

but who in fact suffered with very minor

injuries, no injuries at all, or were not

actually involved in an accident.”

The allegedly objectionable testimony

goes to the issue of Cothran's knowing partici-

pation in the scheme. Admission of the testi-

mony was proper as it fics squarely within the

confines of Rule 404(b) of the Federal Rules of

Evidence.°

6 F. R. Evid. 404(b):

Evidence of other crimes, wrongs, or

acts is not admissible to prove the charac-

ter of a person in order to show that he

acted in conformity therewith. It may,

however, be admissible for other purposes,

such as proof of motive, opportunity,

intent, preparation, plan, knowledge,

identity, or absence of mistake or acci-

dent.

In a factually similar case (involving a

prosecution of a lawyer for conspiracy and

mail fraud), the Eight Circuit has held that

the trial court did not abuse its discretion

in admitting evidence of similar criminal acts

not charged in the indictment, since such

evidence is relevant to the issue of the

defendant's knowing participation in the scheme.

United States v. Witschner, 624 F.2d 840 (8th

Cir. 1980), cert. denied, 449 U.S. 994 (1980).

The testimony here was properly admitted for

it went to more than criminal disposition alone.

It “served to complete the story of the crime

on trial by proving its immediate context of

happenings near in time and place." McCormick,

Evidence, Cleary ed. 1972 §190, p. 448; United

States v. Masters, 622 F.2d 83, 87 (4th Cir.

1980). It was closely linked to the activities -

charged and was relevant on the issue of intent,

motivation, preparation, and plan. United

States v. Klauber, 611 F.2d 512 (4th Cir. 1979),

cert. denied, 446 U.S. 908 (1980).

-39-

Government witness Gary Pearson

testified that, during the investigation of the

case, he was taken to Cothran's law office at

gunpoint and that Cothran offered him money to

leave town. Immediately upon the conclusion

of Pearson's testimony, the trial judge

instructed the jury that evidence tending to

show consciousness of guilt was not sufficient

to establish guilt. He further instructed and

reminded the jury that they had heard only one

side and that they should not determine guilt

until they had heard the other side. Counsel

for Cothran promptly moved for a mistrial on

the grounds that the timing of the instruction

gave the jury the improession that the burden

of proof had shifted to him. The trial judge

did not give a curative instruction until the

7

following morning. Cothran argues that this

7 It read:

So if you interpreted my instructions

yesterday as creating any burden on any

defendant to answer those charges, then

disregard that because the burden of proof

that issue S every other issue in

thé cane; rembine GiLth tht. Gaited States.

instruction came too late.

Cothran does not contend that the

testimony was improperly admitted. His

quarrel is with the subsequent instructions.

We see no error in the first instruction. The

trial judge merely told the jury not to form

any opinion concerning Cothran's guilt or

innocence until they had heard all of the

evidence. The instruction was cautionary. It

aid not place undue emphasis on Cothran. It

did not shift the burden of proof to Cothran.

Moreover, the curative instruction

given the following morning sufficed to

dispel any misunderstanding which may have

existed. The curative instruction took great

care to make it quite clear to the jury that no

shift in the burden of proof has occurred.

Cothran relies heavily on the prohibition

against inconsistent instructions. E.g., Perez

v. United States, 297 F.2d 12 (5th Cir. 1961).

The instructions, however, were consistent.

The second is but a clarification of the first.

-41-

The jury was informed as to the proper burdens.

There is no error. United States v. Prince,

515 F.2d 564, 567 (Sth Cir. 1975), cert. denied,

423 U.S. 1032 (1975).

Cothran next complains of the testi-

mony of two medical expert witnesses, Drs.

Bradham and Ravita, called by the government.

The witnesses testified as to the professional

relationship between physicians and attorneys

and to the friendship of Cothran and Harrison

based upon the files of patients of Harrison

referred by Cothran. Cothran maintains that

allowance of the testimony was improper and

prejudicial in that it invaded the province of

the jury as factfinder. Cothran's argument

ignores the existence of Rule 704 of the Federal

Rules of Evidence which permits witnesses to

testify as to ultimate issues of fact.° In

8 Ped. R. Evid. 704 provides that:

Testimony in the form of an opinion

or inference otherwise admissible is not

objectionable because it embraces an

ultimate issue to be decided by the trier

of fact.

any event, we need not overly concern ourselves

with the questions. Pursuant to the discretion

embodied in Rule 403 of the Federal Rules of

Evidence, °

the trial judge carefully limited

the testimony of the physicians. Some testi-

mony already given was struck from the record.

9 Fed. R. Evid. 403 provides that:

Although relevant, eviderce may be

excluded if its probative value is substan-

tially outweighed by the danger of unfair

prejudice, confusion of the issues, or

misleading the jury, or by considerations

of undue delay, waste of time, or needless

presentation of cumulative evidence.

-43-

Other testimony was the subject of a cautionary

instruction.

10

10

Ladies and gentlemen of the jury, we

have heard some testimony by Dr. Ravita

about certain things that he considered

unusual from his examination of these

various files and medical reports, and

he was qualified as a medical expert,

and this type testimony I do not think

is proper for the field of medical

expertise, because really it gets into

the field of just oe what is

there, his testimony ut the same type

thing, is not in the realm of expert

testimony. So, disregard all of that

testimony.

Now, he can testify, as a doctor,

about what he might do or would have done

or what the proper treatment is, but his

observations about the unusual coincidences

that he says appeared in the various files,

you should disregard it and I am striking

that from the record.

Counts 5

-44-

Cothran's fourth complaint is that

11 sna 1877 should have been struck

from the indictment or a judgment of acquittal

ll

12

THE GRAND JURY FURTHER CHARGES THAT:

2. That on or about the llth day of

August, 1975, in the District of South

Carolina, JAMES W. COTHRAN, JR. for the

purpose of executing the aforesaid scheme

and artifice to defraud, did cause to be

delivered by mail according to the direc-

tion thereon a letter to American Inter-

insurance Exchange, North Charleston,

South Carolina, in violation of the

provisions of Title 18, United States

Code, Section 1341.

THE GRAND JURY FURTHER CHARGES THAT:

2. That on or about the 5th day of

April, 1976, in the District of Sou

Carolina, JAMES W. COTHRAN, JR. and BOBBY

RICHARDSON, for the purpose of executing

the aforesaid scheme and artifice to

defraud, did cause to be delivered by mail

according to the direction thereon a

letter to Seibels Claims Service, an agency

of South Carolina Insurance Company, Colum-

bia, South Carolina, in violation of the

provisions of Title 18, United States Code,

Section 134l.

-45-

should have been entered with respect to the

counts. Cothran contends that, as to Count 5,

he did not cause to be mailed a letter as

charged in the indictment; and that, as to

County 18, no claims were made as alleged in

the indictment; and that, as to both counts,

no mailing was caused for the purpose of

executing any schemes.

We must view the evidence in a case

on appeal in a light most favorable to the

government. United States v. George, 568 F.2d

1064, 1068 (4th Cir. 1978), citing Glasser v.

United States, 315 U.S. 60, 80 (1942). Con-

trary to Cothran's assertion, sufficient

evidence existed to support the allegations in

Counts 5 and 18 and to convict him on the

charges.

One of the theories of the govern-

ment's case was that the defendants caused as

many accident claims as possible to be filed.

The key to making such fraud successful was

to file many small claims so that the

-46-

insurance companies would settle rather than

having a few large contested claims.

Concerning Count 5, Harvey Earl Ken-

nedy, a government witness, who was a client

of Cothran's, testified that Cothran gave him

money to go to his insurance agency and expand

the coverage of his father's insurance policy

after an accident had already occurred.

Almendia K. Bush, a sister of Kennedy's and a

client of Cothran's, testified that Cothran

told her she should claim that she was in the

wreck in order to collect insurance proceeds,

even though she had not been in the wreck.

Consequently there was sufficient evidence to

show that Cothran directed expansion of the

coverage provision in the insurance policy, so

that Cothran could attempt to file broader

fraudulent claims.

Uncontradicted testimony at trial

established that Cothran reasonably should have

foreseen that a form requesting change of

coverage would have been sent through the mails.

-47-

See United States v. Perkal, 530 F.2d 604, 607

(4th Cir. 1976), cect. denied, 429 U.S. 821

(1976). The insurance agency, located in

Columbia, South Carolina, by custom and prac-

tice, mailed amendments of policies to its

regional offices in North Charleston, South

Carolina. The evidence of mailings was

sufficient to submit the questions to the jury.

United States v. Silvern, 494, ¥.2d 355, 360

(7th Cir. 1973). It does not matter that no

claim was ever filed as a result of the

particular accident. Success of the scheme is

not a necessary element in proof of mail fraud

under Section 1341. See United States v. Gas-

kill, 491 F.2d 981, 984 (8th Cir. 1974).

Count 18 involved the so-called

“phantom vehicle" accident. Five persons were

riding in a car driven by defendant Richardson

when, without warning, it crashed into a build-

ing. One passenger testified that no other

vehicle was tevelved, though later Richardson

Claimed he had been forced off the road by

~48<

another car. The following day the occupants

of the car, in the company of Richardson, went

to Cothran's office. Cothran instructed them

to “find someone to say" he was the driver of

the phantom vehicle. Cothran represented the

individuals and mailed their medical bills

with a cover letter to the insurance agent.

Such was the mailing referred to in the indict-

ment. No payments were ever made by the

insurance company because the driver of the

"phantom vehicle" never turned up. Again, the

lack of success of the scheme is irrelevant to

proof of the crime. United States v. Gaskill,

supra.

Lastly, the mailings alleged in Counts

5 and 18 both support federal criminal juris-

diction. The mailings were a step toward re-

ceipt of the fruits of the scheme. Without

increasing the coverage under Kennedy's father's

insurance policy, no recovery could be had in

Almendia K. Bush's name. Likewise, without

filing claims for the persons in the "Phantom

-50-

vehicle" accident, no recovery could be had.

The mailings were not irrelevant to the scheme

or its success. Consequently, they fulfilled

the statutory requirement and sustain Cothran's

convictions. United States v. Maze, 414 U.S.

395 (1974); United States v. Perkal, 530 F.2d

604, 607 (4th Cir. 1976), cert. denied, 429

U.S. 821 (1976).

Defendants Cothran, Cooper, and

Johnson allege error with regard to the trial

judge's instruction to the jury that violations

of the Code of Professional Responsibility

could be considered evidence of fraudulent

intent. However, the trial judge specifically

told the jury that the Code was relevant only

to Cothran. No other defendant was named.

Cooper argues that the inclusion of

the word “also” in the charge obscured the

applicability of the Code to lawyers alone.

We find the assertion without merit. Prior

to reading the particular code sections to the

jury, the trial judge stated: "The existence

-5l-

of these rules may also be considered by you

as relevant to the defendant Cothran's intent

to defraud, if such intent did exist."

immediately previously, the trial judge had

identified the Code as “governing the conduct

of lawyers," "a rule of practice for lawyers",

and “the standard of conduct expected of law-

yers in the state". Cooper has misread the

trial judge's statement. "Also" is used in the

simple sense of meaning that the jury could

consider the Code of Professional Responsibi-

lity in addition to all the other evidence

relevant to Cothran's fraudulent intent. The

jury could in no way infer that unethical con-

duct by Cothran might bear on the guilt of

Cooper. Neither Johnson nor Cooper has cause

for complaining of the instruction.??

13 Counsel for Johnson did not even take

exception to the charge at trial.

-52-

We already have sanctioned the appli-

cation of the Code in criminal jury instructions

where the defendant is an attorney. United

States v. Klauber, 611 F.2d 512 (4th Cir. 1979),

cert. denied, 446 U.S. 908 (1980) (member of

the Maryland Bar); United States v. Reamer,

589 F. 2d 769 (4th Cir. 1978), cert. denied,

440 U.S. 980 (1979) (member of the Maryland

Bar). Cothran grounds his objection to the

Code instruction on the fact that, unlike South

Carolina, in Maryland the Code has been adopted

by statute. We see no material difference.

Under the South Carolina Constitution,

the rulemaking authority concerning attorneys

is vested in the South Carolina Supreme Court.

S. C. Const. art. 5, §4, see In Re Primus, 436

U.S. 412 (1978). South Carolina attorneys are

subject to discipline for violations of the

Code. The rules are not to be treated lightly

whether adopted by court action or by statute.

The (..de establishes the standard of conduct

for attorneys in South Carolina. As such, it is

"relevant to the attitude [Cothran], as a

member of the Bar, should have maintained toward

the practices that were proven." See United

States v. Klauber, 611 F.2d at 520; United

States v. Rabbitt, 583 F.2d 1014, 1029 (8th

Cir. 1978), cert. denied, 439 U.S. 1116 (1979)

III. Cooper's Conviction

Defendant Cooper was convicted of

Counts 13, 14 and 16 of the indictment. "Any-

one who ‘knowingly and intentionally’ partici-

pates in the execution of the fraudulent scheme

comes within the prohibition of the statute

- « «+ Whether the indictment charges a conspir-

acy or not". United States v. Perkal, 530 F.2d

604, 606 (4th Cir. 1976), cert. denied, 429 U.S.

821 (1976) (citations omitted). The prosecution

alleged three facts to prove Cooper's awareness

‘of the scheme to defraud: (1) the referral of

two clients to Cothran; (2) Cooper's receipt of

various loans from Cothran; and (3) Cothran's

handling of an autmobile accident claim for

Cooper. While such circumstantial facts may be

-54-

used toprove guilt, the circumstances proved

and the inferences which can reasonably be drawn

therefrom must tend to show that the defendant

is guilty beyond a reasonable doubt. United

States v. Stroupe, 538 F.2d 1063, 1066 (4th

Cir. 1951), cert. denied, 340 U.S. 930 (1951).

It is true that every reasonable hypothesis

consistent with innocence need not be excluded.

United States v. Mankins, 497 F.24 1265, 1267

(4th Cir. 1974), cert. denied, 419 U.S. 899

(1974). Nevertheless, there must be substan-

tial evidence upon which the “jury might justi-

fiably find the defendant guilty beyond a rea-:..

sonable doubt." United States v. Chappell, 353

F.2d 740, 748 (4th Cir. 1960), cert. denied,

364 U.S. 850 (1960) (emphasis in original).

See also United States v. Glasser, 315 U.S. 60,

80 (1942); United States v. Sherman, 421 F.2d

198, 199 (4th Cir. 1970), cert. denied, 398

U.S. 914 (1970). We reverse here because the

evidence, viewed in the light most favorable

to the government, simply is insufficient to

-55-

support the jury finding that Cooper had knowl-

edge of the scheme.

Cooper was an employee of Johnson's

wrecker service removed in both the phsycial

sense, because he was usually out on the road,

and the organizational sense, because of his

status, from managerial decisions. Cooper was

in no position to know of any managerial

decision made by Johnson to engage in a fraudu-

lent scheme with Cothran. There is nothing to

indicate that Cooper heard or saw anything

which would have tipped him to the existence of

the scheme. Compare United States v. Grow, 394

F.2d 182 (4th Cir. 1968), cert. denied, 393

U.S. 840 (1968) (defendant occupied managerial

position and inference of guilty knowledge was

permissible because of volume of information on

.

corporate operations available to him), and

United States v. Mortimer, 118 F.2d 266 (2d

-56-

Cir. 1941), cert. denied, 314 U.S. 616 (1941)

(defendant in active charge of the company's

business so that inference justified that he

Was aware of customary practices or conditions

of general significance), with United States

v. Franklin, 608 F.2d 241 (6th Cir. 1979)

(although defendant was the intermediary in a

loan transaction which constituted misappli- .

cation of bank funds, no evidence existed to

suggest his familiarity with or even remote

awareness of any of the facts surrounding the

loan application or its processing), and United

States v. Pearlstein, 576 F.2d 531 (3d Cir.

1978) (salesmen in no position to know of

fraudulent scheme devised by the corporate

management) .

Cooper's personal contacts with

Cothran likewise do nothing to brand Cooper as

a knowing member of the illicit scheme. The

contacts were sporadic and strictly confined to

an attorney-client relationship; any loans made

by Cothran to Cooper were fully repaid; and

-57-

Cooper's autmobile claim was bona fide and is

unlinked on its face to the scheme to defraud

the insurance companies.

Of the two referrals which Cooper

made to Cothran, the first was of Ronnie Portee,

to whom Cooper was a "dutch uncle." They had --

known each other for many years and were members

of the same "family". Cooper only accompanied

Portee and his mother to Cothran's office at

the mother's insistence, and after making

introductions Cooper left. The second referral

was of Hercules Pauling. The Paulings were

frum out of town and knew no attorneys in the

area. Cooper referred Pauling to Cothran because

Cothran had previously represented Cooper and

Cooper had been pleased with Cothran's work.

Cooper was not aware that the Paulings had seen

Cothran until he ran into Mr. Pauling later at a

fast food store where Cooper was employed. The

referrals are archtypically of the type which

one hopes a satisfied client or customer will

send one's way. They have nothing inherently

=-58-

improper, or even unusual, about them. That

Cothran may have seized the opportunities

presented by the referrals to advance his

fraudulent undertaking does not cast back

onto Cooper any responsibility for that under-

taking. United States v. Falcone, 31l J.S. 205

(1940).

The government makes much of the

various loans Cothran extended to Cooper. It

urges a presumption that the loans represented

payment for referrals or Cooper's share of the

fraudulent earnings. We cannot draw the pre-

sumed conclusion. Cooper denied ever receiving

monies for making referrals to Cothran.

Cothran testified that the only substantial sum

involved was an advance against the anticipated

proceeds from a claim made by Cooper, and

that the advance was fully repaid upon settle-

ment of the claim. Other loans made by Cothran

to Cooper were in small amounts and by check.

All of the loans were repaid. The evidence of

repayment was not questioned or contradicted.

Repayment of the loans by itself, refutes the

inference which the prosecution desired the jury

to draw from the advancement of monies.

Likewise, the most significant item

of evidence alleced by the government to justi-

fy a finding of guilty knowledge on Cooper's

part does not provide the desired justification.

On November 26, 1976, Cooper was driving a tow

truck which ws rear-ended by another vehicle.

Cooper subsequently contacted Cothran to re-

present him on the accident claim. While the

government now states that "it was for the jury

to determine if the accident was staged," the

government had not asked the jury to infer that

the accident was staged. Neither was actual

proof of fabrication offered. On the contrary,

the government's contention at trial was that

the resulting claim was inflated. In closing,

the government's attorney said, "Now, again, we

say that this isasituation where the physical

facts simply do not justify the injuries that

were claimed and the claim that was filed with

-60-

the insurance company." The evidence, however,

does not sustain the argument.

The testimony showed that the other

driver admitted liability; that Cooper refused

to settled at the scene because the tow truck

belonged to his employer; and that Cooper's

Claim was bona fide. Cooper did not visit Dr.

Harrison, the physician for the scheme, but

instead went to Dr. Thurmond Walker for treat-

' ment of the injuries he sustained in the automo-

bile accident. The loss of wage statements

filed by Cooper were shown to be authentic. The

government would have us believe that the

injuries claims were not consistent with the

details of the wreck. However, the mere fact

that the tow truck suffered minimal damage does

not compel the conclusion that Cooper suffered

only minimal injuries. The car. which struck

the more solid truck did sustain approximately

$170.00 worth of damage. Cooper's injuries are

consistent with the impact of the accident.

-61-

Finally, Cooper's choice of Cothran to repre-

send him on the claim indicates nothing more

than a continuation of an established attorney-

client relationship in which Cooper was com-

fortable due to his satisfaction with Cothran's

prior work.

The evidence produced against Cooper

shos behavior wholly consistent with innocence.

In no way does it indicate that the gist of

the scheme to defraud was brought to his knowl-

edge. Cf. United States v. Perkal, supra, 530

F.2d at 606; Reistroffer v. United States, 258

F.2d 379, 395 (8th Cir. 1958), cert. denied,

358 U.S. 927 (1959).

IV. Motions for Severance

Dr. Harrison contends that the dis-

trict court's denial of his motions for

séverance and separate trial was reversible

error. The prejudice is said to arise from the

antagonism between Harrison's defense and that

of Cothran which precluded the introduction of

allegedly crucial evidence for Harrison, the

. $62-

testimony of Dot Raven. Harrison also main-

tains that the prejudice could not be cured by

cautionary instructions to the jury.

As a general rule, persons jointly

indicted should be tried together and the ques-

tion of severance is one which remains within

the sound discretion of the trial judge. United

States v. Shuford, 454 F.2d 772 (4th Cir. 1971);

Hall v. United States,168 F.2d 161 (D.C. Cir.

1948). The peculiar facts of the case must

demonstrate a substantial degree of prejudice

so as to result in a miscarriage of justice for

us to disturb the determination of the district

court. United States v. Becker, 585 F.2d 703,

706 (4th Cir. 1978); United States v. Jakubik,

585 F.2d 667, 674 (4th Cir. 1978); United States

vy. Shuford, supra.

Harrison relies principally upon our

decision in Shuford where the testimony of a

co-defendant would have served to exonerate

Shuford in a separate trial. The case involved

the crucial fact of Shuford's instructions to

~63-

one Gene H. Long about which both Shuford and

Long testified. The only other potential

witness with direct knowledge was Shuford's

co-defendant who, absent severance, refused to

testify. Since the situation became a credi-

bility contest, since the co-defendant's testi-

mony was of vital importance to Shuford, and

since no undue burden on judicial administra-

tion would result, we determine that severance

should have been granted. 454 F.2d at 777,777

N.5. Shuford involved a unique factual setting.

Accordingly, we have stressed the importance

of ascertaining with a “reasonable probability"

that exculpatory testimony will be forthcoming

at a separate trial. United States v. Jakubik,

585 F.2d at 574-575 (testimony at issue "had

less than a pivotal bearing on Jakubik's guilt

ox innocence"); United States v. Becker, 585

F.2d at 707 (testimony of co-defendant only

conditionally offered).

Here the standard for severance sim-

ply has not been met. The testimony sought

-64-

was not that of a co-defendant. Neither was

it crucial to Harrison's case. The stipulated

testimony, not received into evidence on account

of Cothran's objection, did not contradict the

unfavorable evidence introduced against Harri-

son. Taken at its strongest, the stipulation

at most somewhat bolstered Harrison's own

testimony. Moreover, there was no guarantee

that Raven would be available to testify at a

separate trial or that the government would

stipulate to her testimony. In addition, the

trial was long and complicated, with many

witnesses and evidence which related to several

defendants. Consequently, concerns over

efficiency in judicial administration also

weigh against granting severance. See United

States vy. Shuford, 454 F. 2d at 775-776.

Similarly, Harrison's claim that

severance was required because his and Cothran's

defenses were antagonistic must fail.

"Antagonistic defenses do not per se require

severance, even if the defendants are hostile

or attempt to cast the blame on each other."

United States v. Becker, supra, 585 F.2d at 707.

"It [was] not so much that the defenses were

antagonistic to each other as it is that the

evidence was antagonistic to the defenses."

United States v. Becker, supra, 585 F.2d at

707; United States v. Frazier, 394 F.2d 258, 261

(4th Cir. 1968), cert. denied, 393

U.S. 984 (1968). The trial judge did not abuse

his discretion in denying Harrison's motions

for severance and separate triai.!4

Johnson also moved for a severance

and separate trial. Prejudice allegedly arose

from a “spill-over" effect resulting from the

vast evidence introduced against the five

defendants on twenty counts; the"cross-fire"

situation for Johnson resulting from the

allegedly antagonistic defenses of Cothran and

14 Since we find no harm in the denial

of severance, we need not address Harrison's

assertion that the cautionary instructions

given to the jury could not cure the

allegedly erroneous joinder.

-66-

and Harrison; and the presentation of numerous

witnesses regarding incidents in which Johnson

had no participation; Johnson assets the total

effect was one of confusion and prejudice. It

has long been the law that “when many conspire,

they invite mass trial by their conduct."

Kotteakos v. United States, 328 U.S. 750, 773

(1946); United States v. Perez, 489 F.2d 51,

65 (Sth Cir. 1973). Johnson has failed to show

a clear abuse of discretion. For much of the

reasons stated above concerning Harrison's

demands for severance and separate trial, we

find no abuse of discretion in the dential of

Johnson's motion for like relief.

V. Johnson Conviction

Johnson further alleges that there was

insufficient evidence to sustain his conviction.

However, the evidence did suffice to persuade

the jury of Johnson's guilt. It showed that

there was a kickback scheme between Johnson and

area police officers designed to channel wreck

victim customers to Johnson. Johnson admitted

~67<

having recommended Cothran to his customers

numerous times, a fact that Cothran confirmed.

Cothran further states that he gave free legal _

representation to Johnson in return for John-

15 Government

son's recommending client to hin.

witness Lee Dukes testified that Johnson told

him to make a false claim that he had been

injured in an accident and referred him to Coth-

ran. Another government witness, Sandra Hursey,

testified that Johnson called Cothran and that

she was referred to Cothran by Johnson. Govern-

ment witness Harvey Earl Kennedy was sent by

Cothran to Johnson, and Johnson taught him how

to use a police scanner in order to recuit

accident victims for the scheme. Amply evidence

existed to support the jury finding that John-

son knowingly participated in the scheme.

Johnson's next allegation of error con- .

cerns the admission of the testimony of Ira C.

Carney, a former Columbia, South Carolina,

15 Johnson's denial the jury was free to

disregard.

768

police officer. The testimony showed that

Johnson had paid Carney in return for Carney's

referral of accident wrecks to Johnson.

Carney stated he received fifteen dollars per

wreck and that payment was made eight or nine

times. The payments occurred within the time

frame of the indictment. The evidence was -

offered to prove knowledge and preparation of,

and participation in, the scheme. As such,

' the testmony was properly admitted under Fed.

R.Evid. 404(b). United States v. Masters, 622

F.2d 83, 87 (4th Cir. 1980); United States v.

Smith, 446 F.2d 200 (4th Cir. 1971). Johnson

asserts that the testimony was prejudicial

because the government implied by it that

Johnson had bribed an officer. However, John-

son admitted making the payments to Carney

and the inference of bribery to further the

fraudulent scheme is not an unreasonably one.

Johnson's final complaint is that

his not guilty plea and the loss of wages

signed by him were not properly authenicated

~69-

and admitted under Fed. R. Evid. 901. Con-

trary to Johnson assertions, both documents

were properly admitted by the trial court.

The trial court admitted the loss of

wages form contingent on proof of authenticity.

The authenticity issue associated with the

proof of loss of wages form was properly one,

under the evidence adduced, for the jury to

resolve. The court admitted Johnson's not

guilty plea as a handwriting sample with which

the jury could compare the ioss of wages form

in determining whether Johnson had signed that

form. Johnson and his wife had testified that

the wife filled out and signed Johnson's name

to the forn.

Whether Johnson had signed the form

himself was an issue for the jury's determina-

tion. United States v. Goichmen, 547 F.2d 778,

784 (3d Cir. 1976). The jury is competent to

compare the writing whose authenticity is

challenged with a genuine specimen of the

alleged author's handwriting and to draw its

“70+

own conclusion in the absence of expert

Opinion. Fed. R. Evid. 901(b) (3); United

States v. Woodson, 526, F.2d 550, 551 (Sth Cir.

1975); see Strauss v. United States, 311 F.2d

926, 932 (Sth Cir. 1963); Goins v. United

States, 99 F. 2d 147, 151 (4th Cir. 1938). It

is well settled that a "party's signature to

a pleading, motion or other procedural instru-

ment on file in the court can be used as a

specimen without further proof of its genuine-

ness." 5 J. Weinstein & M. Berger, Weinstein's

Evidence §901(b)(3) [2] (1978). Johnson does

not dispute that this signature appeared on his

not guilty plea. The plea was properly ad-

mitted, 28 U.S.C. §1731. Consequently, so was

the loss of wages form. No error occurred.

VI. Richardson

Richardson contends that the govern-

ment failed to fully comply with Brady v. Mary-

land, 373 U.S. 83 (1963). The specific items

Richardson maintains should bave been provided

to his counsel prior to trial are (1) the

<71-

statement of Cothran's defense witness Drigger

Scipio and (2) the statements of government

witnesses Hopkins, Richardson, and Williams.

Neither incident contravenes Brady's prohibi-

tion against “the suppression by the prosecu-

tion of evidence favorable to an accused upon

request .. . where the evidence is material

either to guilt or to punishment, irrespective

of the good faith or bad faith of the prosecu-

tion." 373 U.S. at 87. Here, regardless of the

nature of the prior statements, no Brady

problem arose. The facts related in the state-

ment were not suppressed, In both cases the

material was furnished to counsel for Richardson

in time for cross-examination. Indeed, the

government used the Scipio statement in the

course of its own cross-examination of Scipio.

"As Long as ultimate diclosure is made before

it is too late for the defendants to make use

of any benefits of the evidence, Due Process is

satisfied.” United States v. McPartlin. 595

F.2d [1321], 1345-1347 (7th Cir. 1979); United

States v. Ziperstein, 601 F.2d 281, 291 (7th

Cir. 1979), cert. denied, 444 U.S. 1031 (1979).

Richardson's final allegation of

error concerns the admission of his own written

statement, an admission which Richardson con-

tends contravences Miranda v. Arizona, 384 U.S.

436 (1966). The trial court held a hearing on

the question of whether the statement was

voluntary at which Richardson testified. Hav-

ing conducted a full and fair hearing the trial

judge found that the statement had been

voluntarily. Finding no error in his determina-

tion, we conclude that Richarlson statement was

properly admitted.

Accordingly, the conviction of

Cooper is reversed, without a new trial, the

evidence having been legally insufficient to

sustain a conviction. As to all other defen-

dants, the convictions are affirmed.