Petition for Writ of Certiorari — Smith v. United States

Supreme Court, U.S.

= = ————_

a a ew,

In The JUL 22 1968

Supreme Court of the ited States ted

Pat ee —----

ides i

_

October Term, 1986

WILLIAM T. SMITH, JR.,

Petitioner,

vs.

UNITED STATES OF AMERICA,

Respondent.

PETITION FOR WRIT OF CERTIORARI TO THE UNITED

STATES COURT OF APPEALS FOR THE THIRD CIRCUIT

JOHN ROGERS CARROLL

CARROLL & CARROLL

Attorneys for Petitioner

Suite 1206

615 Chestnut Street

Philadelphia, Pennsylvania 19106

(215) 925-4100

tz = * NJ (201) 257-6850°NY (212) 840-9494°PA (215) 563-5587

eee s.ime. MA (617) 542-1114*DC (202) 783-7288*USA 4800) 5 APPEAL /

QUESTIONS PRESENTED FOR REVIEW

1. Whether the trial court violated Rule 30 of the Federal

Rules of Criminal Procedure where, having first instructed the

jury as agreed in the charge conference, that they must find a

single conspiracy and a single mail fraud scheme to convict

petitioner on the conspiracy and substantive counts of the

indictment, it later reversed this instruction in a supplemental

charge, and endorsed a new theory of liability wholly at odds

with the assumptions of counsel in their closing speeches and

allowing conviction on a finding of participation in any one of

three schemes or conspiracies.

2. Whether petitioner was denied his constitutional right to

a unanimous jury verdict where the trial court authorized an eleven

person verdict, over petitioner’s objection, following the disability

of one juror after three days of deliberation pursuant to Rule

23(b) of the Federal Rules of Criminal Procedure.

il

LIST OF PARTIES

The parties to the proceeding in the United States Court of

Appeals for the Third Circuit whose opinion is sought to be

reviewed are as follows:

United States of America, appellee;

William T. Smith, Jr., appellant and

Alan R. Stoneman, appellant.

i

TABLE OF CONTENTS

Page

Questions Presented for Review ..............cceceees i

ESE ee ee ee ee ee il

RE a ee Se ee ee iii

er idglaina nasa eee sass ons vee vo iv

Adoption and Joinder in Other Petitions Filed.......... l

awn i chk Kiww esha ee donee (eT EVE 2

Ny eas h es beso orsescoseseces 2

Constitutional Provisions and Rules [nvolved........... 2

as i oak kas ke bev sere ees’ s 4

Reasons for Granting the Writ........................ 8

I. The Court of Appeals’ decision sanctions a Rule 30

violation by upholding the trial court’s supplemental

instructions on multiple conspiracies, reversing the

agreed single conspiracy instructions, thereby allowing

conviction for an offense not charged and presenting

a new theory of criminai liability that the defense had

no opportunity to address in closing argument.

iv

Contents

II. The 1983 Amendment to Rule 23(b) of the Federal

Rules of Criminal Procedure, authorizing the trial

court to allow eleven person juries to return a valid

verdict if one juror becomes unavailable, is

ES 5 oe nck eas beaten neces.

Ce So teva ae PR aR ee ke Nw ee ie Meee e

TABLE OF CITATIONS

Cases Cited:

Andres v. United States, 333 U.S. 740 (1948)...........

Apodaca v. Oregon, 406 U.S. 404 (1972) ..............

Kotteakos v. United States, 328 U.S. 750 (1946) ........

Ross v. United States, 180 F. 2d 160 (6th Cir. 1950) ....

United States v. Gurerrero-Teraita, 446 F. 2d 876 (9th Cir.

is ree COE Cee hak ae ek eewe.

““VCiwawtencesauecasuvVyew Eve ROS ee Pe eNO te ee Oo Pe ee

“ey ae 2 he as ey Se ee ae oe we ee ee a ae A ee ee ee ee

KP Oe Oo O66 6 ESO OS SS BOS Ole 2214 2 6 0.40 8 ES OD .S- ee OO SE-B’ DO OO

United states v. Pacente, 503 F. 2d 543 (7th Cir. 1974)....

Page

11

=

“

13

Contents

Page

United States v. Scalzitti, 578 F. 2d 507 (3d Cir. 1978)

United States v. Vega, 447 F. 2d 698 (2d Cir. 1971)..... 13

United States v. Wander, 601 F. 2d 1251 (3d Cir. 1979)

Williams v. Florida, 399 U.S. 78 (1970)............... 12, 13

Wright v. United States, 339 F. 2d 578 (9th Cir. 1964)

Statutes Cited:

DD eas P00 Aa haw oie sas poet eee cee 4

Oe ain BE ca eens ons ba eeilcencd koe ees 4

gS ee 8 ee eee eee 4

Oe ss, BE NEE on sin So 6 pa woud nlagcsnds cekeiiaee 2

vi

Contents

Page

United States Constitution Cited:

PIP TET ET TOT CT OCTET CRT TT TTT CT TTT 2

Rules Cited:

Federal Rule of Criminal Procedure 23(b)...i, 3, 7, 11, 12, 14

Federal Rule of Criminal Procedure 30..... Lah 1h 7

Federal Rule of Criminal Procedure 31l(a)............. 13, 14

RF eee re ee eee |

Other Authority Cited:

Federal Rule of Criminal Procedure 23(b) Advisory

Committee Note ............... Mules Faescd owe 12, 13

APPENDIX

Appendix A—Opinion of the United States Court of Appeals

for the Third Circuit Filed April 28, 1986.......... la

Appendix B—Opinion of the United States District Court for

the Middle District of Pennsylvania Filed October 17,

a ites es ane Mieke ends eee eeabkas 25a

Appendix C—Order of the United States Court of Appeals

for the Third Circuit Affirming Judgment Filed Apri

SE Sah tance keh exe ieee URE he ounes 52a

vil

Contents

Page

Appendix D—Order of the United States Court of Appeals

for the Third Circuit Denying Petition for Rehearing

gg REP Re rere rege etne Geena nen lrteaeraes S4a

Appendix E—Order of the United States Court of Appeals

for the Third Circuit Staying Mandate to July 22, 1986

Free Ae ewe he be 56a

No.

In The

Supreme Court of the United States

October Term, 1986

WILLIAM T. SMITH, JR.,

Petitioner,

VS.

UNITED STATES OF AMERICA,

Respondent.

PETITION FOR WRIT OF CERTIORARI TO THE UNITED

STATES COURT OF APPEALS FOR THE THiRD CIRCUIT

Petitioner, William T. Smith, Jr., prays that a writ of

certiorari issue to review the judgment of the United States Court

of Appeals for the Third Circuit which affirmed his judgment

of conviction entered upon a jury verdict of guilty.

ADOPTION AND JOINDER IN OTHER PETITIONS FILED

Pursuant to Supreme Court Rule 19.4, the petitioner, William

T. Smith, Jr., respectfully adopts and joins in the petition for

writ of certiorari filed by co-petitioner, Alan R. Stoneman.

OPINIONS BELOW

The panel opinion of the United States Court of Appeals

for the Third Circuit is reported at 789 F. 2d 196, and also appears

as Appendix A to this petition. The opinion of the United States

District Court for the Middle District of Pennsylvania is reported

at 619 F. Supp. 1441, and also appears as Appendix B to this

petition.

STATEMENT OF JURISDICTION

The petitioner, William T. Smith, Jr., seeks a writ of certiorari

to reviev the judgmert (Appendix C) rendered in accordance with

an opinion (Appendix A) of the United States Court of Appeals

for the Third Circuit on April 28, 1986. The judgment affirmed

petitioner’s criminal conviction entered in the United States District

Court for the Middle District of Pennsylvania following a jury

trial.

A petition for rehearing and suggestion for rehearing en banc

was denied by the Third Circuit Court of Appeals (Appendix D)

on May 23, 1986.

The Supreme Court has jurisdiction to review the judgment

below by writ of certiorari pursuant to 28 U.S.C. § 1254(1).

CONSTITUTIONAL PROVISIONS AND RULES INVOLVED

UNITED STATES CONSTITUTION

AMENDMENT VI-JURY TRIAL FOR CRIMES, AND

PROCEDURAL RIGHTS

In all criminal prosecutions, the accused shall

enjoy the right to a speedy and public trial, by

an impartial jury of the State and district wherein

the crime shail have been committed, which district

shall have been previously ascertained by law, and

to be informed of the nature and cause of the

accusation; to be confronted with the witnesses

against him; to have compulsory process for

obtaining witnesses in his favor, and to have the

Assistance of Counsel for his defense.

FEDERAL RULE OF CRIMINAL PROCEDURE 23

TRIAL BY JURY OR BY THE COURT

(a) Trial by Jury. Cases required to be tried

by jury shall be so tried unless the defendant waives

a jury trial in writing with the approval of the court

and the consent of the government.

(b) Jury of Less Than Twelve. Juries shall be

of 12 but at any time before verdict the parties

may stipulate in writing with the approval of the

court that the jury shall consist of any number

less than 12 or that a valid verdict may be returned

by a jury of less than 12 should the court find it

necessary to excuse one or more jurors for any

just caus after trial commences. Even absent such

stipulation, if the court finds it necessary to excuse

a juror for just cause after the jury has retired to

consider its verdict, in the discretion of the court

a valid verdict may be returned by the remaining

11 jurors.

(c) Trial Without a Jury. In a case tried

without a jury the court shail make a general

finding and shall in addition, on request made

before the general finding, find the facts speciallv.

Such findings may be oral. If an opinion or

memorandum of decision is filed, it will be

sufficient if the findings of fact appear therein.

FEDERAL RULE OF CRIMINAL PROCEDURE 30

INSTRUC “IONS

At the close of the evidence or at such earlier

time during the trial as the court reasonably directs,

any party may file written requests that the court

instruct the jury on the law as set forth in the

requests. At the same time copies of such requests

shall be furnished to adverse parties. The court

shall inform counsel of its proposed action upon

the requests prior to their arguments to the jury,

but the court shall instruct the jury after the

arguments are completed. No party may assign as

error any portion of the charge or omission

therefrom unless he objects thereto before the jury

retires to consider its verdict, stating distinctly the

matter to which he objects and the grounds ot his

objection. Opportunity shall be given to make the

objection out of the hearing of the jury and, on

request of any party, out of the presence of the

jury.

STATEMENT OF THE CAS®

Petitioner was charged, together with two corporate and four

other individual defendants, in a sixteen count indictment with

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

Interstate Transportation and Aid of Racketeering 18 U.S.C

§ 1952(a)(3). The indictment outlined a single conspiracy invoiving

51 overt acts and seven mail fraud violations, and nine Travel

Act violations. The conspiracy count alleged that the defendant

a

sought to obtain Federal Insurance Contribution Act (FICA)

overpayment recovery contracts from various state and local

entities by bribing public officials with cash, stock, stock options,

campaign contributions, employment and paid travel. Under the

theory advanced by the government at trial, petitioner participated

in a single massive scheme to obtain these FICA overpayment

recovery contracts from Allegheny County, Pennsylvania, the City

of Pittsburgh, and the state of Pennsylvania for its school

employees.

The government’s consistent position was that it had proved

a single, massive conspiracy and mail fraud scheme. It equated

the scheme with the conspiracy. The conspiracy count of the

indictment was drafted as a conspiracy to commit the single mail

fraud scheme and each substantive count of the indictment

incorporated by reference all of the charging language of the

conspiracy-scheme count. The government consistently asserted

that its proof was consistent with these allegations.

The defense consistently contended, on the other hand, that

three distinct schemes were carried out by conspiratorial groups

with overlapping personnel all including the government’s primary

witnesses John Torquato and Judy Ellis as well as David Herbert,

a state social security official but involving separate corrupted

officials of each governmental entity with whom they sought a

contract; namely, the City of Pittsburgh, Allegheny County and

the Office of the State Treasurer. Because of the government’s

position with respect to having proved a single scheme-conspiracy,

the court granted defense requests to charge that the jury, in order

to convict, must find such a single scheme and conspiracy. This

issue was fully discussed in the Rule 30 conference and the court

affirmed and eventually gave defendants’ relevant requests to

charge. At the defendants’ request the court instructed that the

single scheme included as objects, obtaining FICA recovery

contracts from Allegheny County, the City of Pittsburgh and

Pennsylvania for its school employees.

Petitioner’s counsel took exception to the trial court’s limiting

the definition of separate conspiracies to those with no connection

to another except that Torquato or one or more other individuals

played a role in each, arguing that this was too narrow a definition

of separate conspiracies. At this juncture, the government untimely

requested two supplemental points introducing new ‘‘Master-

Subsidiary’’ conspiracy language. The trial judge, over objection,

accepted these supplemental points and on the next day instructed

the jury to disregard its prior instructions on conspiracy and gave

the government’s supplemental points.

After brief deliberations the jury requested clarification of

‘the changes in the court’s definition of conspiracy’’ and the

original definition given. Responding to the jury’s confusion, the

trial court again attempted to clean the slate, instructing the jury

to disregard all previous instructions: concerning separate

conspiracies. Ultimately, it instructed the jury:

If you find the defendant not guilty of conspiracy

on the basis of a finding that there was no

agreement among the alleged co-conspirators, you

may nevertheless find the defendant guilty of mail

fraud as charged in the pertinent counts, if you

find that the defendant participated with others

in a common scheme as set forth in the indictment.

Similarly, if you find the defendant not guilty on

Count I on the basis of finding that not one but

several separate and distinct conspiracies existed,

you may nevertheless find that the defendant

violated the mail fraud statute, if the elements of

a violation of that statute have been proven by

the government beyond a reasonabie doubt.

Defense counsel specifically took exception to the supplemental

instructions, on the ground that they reversed the position taken

by the parties and adopted by the court in the Rule 30 conference

and actually instructed upon in the original instructions to the

jury. Counsel reminded the court they had argued in reliance upon

the court’s affirmance of their single conspiracy and scheme points

for charge. The court rejected these contentions and the Court

of Appeals has affirmed this action with near casual oversight.

On the fourth day of jury deliberations, June 19, 1985, one

of the jurors was severely injured in an automobile accident on

the way to the courthouse. Petitioner refused to stipulate to an

11 person jury. The trial court permitted the jury to continue

deliberations with only 11 jurors, pursuant to the 1983 amendment

to Rule 23(b) of the Federal Rules of Criminal Procedure. On

the sixth day of deliberation, the eleven person jury returned a

verdict against petitioner finding him guilty of conspiracy, four

counts of mail fraud and four Travel Act counts.

Petitioner appealed, raising among other issues, the Rule 30

violation and the unconstitutionality of Rule 23(b). At oral

argument, petitioner’s counsel devoted his entire time to the trial

judge’s reversal of position on the conspiracy and scheme

instructions but, except for brief note of the non-critical

‘*subsidiary conspiracy’’ language, the opinion fails to meet this

argument. The Court of Appeals disposed of the supplemental

instruction argument by concluding that the instruction on the

subsidiary schemes did not state a new theory and that petitioner

was On notice of the issue prior to closing argument. The Court

of Appeals further found no constitutional defect in Rule 23(b)

specifically holding that it does not allow a less than unanimous

verdict. Rehearing and rehearing en banc were denied (Appendix

D).

REASONS FOR GRANTING THE WRIT

I.

The Court of Appeals’ decision sanctions a Rule 30 violation

by upholding the trial court’s supplemental instructions on multiple

conspiracies, reversing the agreed single conspiracy instructions,

thereby allowing conviction for an offense not charged and

presenting a new theory of criminal liability that the defense had

no opportunity to address in closing argument.

The Court of Appeals simply rejected petitioner’s contention

that the supplemental instructions on single and multiple schemes

and conspiracies presented a new theory of liability in violation

of Rule 30 of the Federal Rules of Criminal Procedure and

described an offense different from the one charged in the

indictment. The Court of Appeals incorrectly stated that the

supplemental charge was a correct statement of the law and

‘‘merely an elaboration of the earlier instruction’’, and that

defendants were given notice of the instruction before closing

argument (App. A, 13a). Petitioner submits that regardless of

whether the supplemental instruction is a correct statement of

the law (and we believe it was not), Rule 30 prohibits such a 180

degree variation from the original instructions on which counsel

relied upon in their arguments to the jury and where the record

demonstrates that there is fundamental prejudice to the petitioner.

Rule 30 provides in pertinent part: ‘“The court shall inform

counsel of its proposed action upon the requests prior to their

arguments to the jury, but the court shail instruct the jury after

the arguments are complieted.’’ The essential purpose of this ruie

is to ‘require the judge to inform the trial lawyers in a fair way

what the charge is going to be, so that they may intelligently argue

the case to the jury.’’ Ross v. United States, 180 F. 2d 160, 165

(6th Cir. 1950); United States v. Wander, 601 F. 2d 1251, 1262

(3d Cir. 1979). The Circuit Courts of Appeals have granted

reversals in cases involving Rule 30 violations when the change

in the instructions is substantial [United States v. Mandoza, 473

F. 2d 697, 701 (Sth Cir. 1973)], when the trial court’s instructions

repudiate counsel’s argument [United States v. Harvill, 501 F.

2d 295, 297 (9th Cir. 1974)], or where the court’s instructions

deprived counsel of the opportunity to intelligently argue the case

[United States v. McCown, 711 F. 2d 1441. 1452 (9th Cir. 1983);

Wright v. United States, 339 F. 2d 578, 580 (9th Cir. 1964)].

In the instant case, the trial court pertinently instructed the

jury in its main charge on the conspiracy issue as follows:

Unless the jury finds beyond a reasonable doubt

that the government has proved the existence of

a single scheme to defraud, as charged in the

indictment, the defendant must be acquitted of the

pertinent counts. The single scheme charged

includes the obtaining of FICA recovery contracts

from Allegheny County, the City of Pittsburgh and

also the Commonwealth of Pennsylvania. If you

find that Mr. Torquato and others were involved

in separate conspiracies concerning or regarding

Allegheny County or City of Pittsburgh, or

Pennsylvania schooi district FICA recovery

contracts, and the defendant was not a participant

in one or more of these separate conspiracies, then

your verdict as to the defendant on the entire

indictment must be not guilty.

This instruction was a defense request which was approved in

the Ruie 30 conference before closing arguments. A substantial

portion of petitioner’s counsel’s argument focused on petitioner’s

participation being limited to only the Pennsylvania school district

employees’ FICA recovery contract. After the trial court gave

10

the above instruction, the court gave a definition of separate

conspiracies to which defense counsel took exception. Following

extended discussion on an appropriate definition, the government

for the first time urged its new instruction on multiple conspiracies

that eventually led to a second supplemental instruction, given

in response to a jury question, which petitioner contends allowed

the jury to convict on an offense not charged and sanctioned a

prejudical variance from the indictment.

The offending supplemental instruction given to the jury is

as follows:

If you find the defendant not guilty of conspiracy

on the basis of a finding that there was no

agreement among the alleged co-conspirators, you

may nevertheless find the defendant guilty of mail

fraud as charged in the pertinent counts, if you

find that the defendant participated with others

in a common scheme as to set forth in the

indictment.

Similarly, if you find the defendant not guilty on

Count I on the basis of finding that not one but

several separate and distinct conspiracies existed,

you may nevertheless find that the defendant

violated the mail fraud statute, if the elements of

a violation of that statute have been proven by

the government beyond a reasonable doubt.

In the guise of offering merely clarifying instructions, the

government was able to put forward an entirely new legal theory.

Its proof showed three separate conspiracies rather than the ‘‘single

massive scheme’’ theory argued in the closing speeches. Through

11

the supplemental instructions, the jury was informed that they

could also convict on the conspiracy even if they found three

separate schemes involving different people in an undefined

relationship to a master conspiracy.

Rule 30 was specifically designed to prevent the substantial

prejudice that occurred here. The Court of Appeals’ conclusion

that petitioner had notice of the multiple conspiracy issue

misconstrues the essence of Rule 30; that defense counsel has a

right to rely upon the trial court’s proposed action in charging

the jury when counsel makes his or her closing argument.

The trial court’s supplementary instructions not only violated

Rule 30 but sanctioned a material variance of the sort condemned

in Kotteakos v. United States, 328 U.S. 750 (1946). A function

of Rule 30 is to limit the basis of liability to that understood at

the close of the evidence by counsel and the court and articulated

by the court in its charge rulings.

This is an important issue concerning the interpretation and

implementation of Rule 30 of the Federal Rules of Criminal

Procedure, and it has application to all federal criminal jury trials.

II.

The 1983 Amendment to Rule 23(b) of the Federal Rules

of Criminal Procedure, authorizing the trial court to allow eleven

person juries to return a valid verdict if one juror becomes

unavailable, is unconstitutional.

Effective August 1, 1983, Rule 23(b) of the Federal Rules

of Criminal Procedure was amended to permit the return of a

valid verdict by 11 jurors. Prior to the 1983 Amendment, a verdict

of less than 12 jurors was permitted only through an approved

stipulation of the parties. In rejecting petitioner’s challenge to

12

the constitutionality of Rule 23(b), the Court of Appeals held

that the rule does net allow a less than unanimous verdict and

that Williams v. Florida, 399 U.S. 78 (1970), is authority for the

proposition that 12 jurors are not required for conviction in a

federal criminal trial (App. A, 19a). In so holding, the court below

upholds a rule of convenience to avoid retrial of a case at the

severe and impermissible cost to the defendant of a constitutional

right.

In Apodaca v. Oregon, 406 U.S. 404 (1972), five justices

of this Court pronounced unanimity indispensible in a federal

jury trial. The Court observed that this was based on ‘‘the long

and unbroken line of Federal cases viewing the requirement as

established by the Federal system’’. Andres v. United States, 333

U.S. 740 (1948). Unanimity is directly related to the deliberative

function of the jury, serving to ‘‘effectuate the purpose of the

iury system by promoting full expression of the views of all

members of the jury and by insuring that those views are taken

into account as fully and fairly as possible in reaching a verdict’’.

United States v. Scaizitti, 578 F. 2d 507 (3d Cir. 1978).

The amended Rule 23(b) allows a trial court discretion to

allow 11 person juries to continue deliberation if one juror becomes

unavailable for any ‘‘just cause’’. Rule 23(b) was prompted by

the dilemma posed in certain cases where a juror became

unavailable after a lengthy trial and a mistrial would be extremely

burdensome. Fed. R. Crim. P. 23(b) Advisory Committee Note;

United States v. Stratton, 779 F. 2d 820, 831 (2d Cir. 1985). While

the amended Rule 23(b) might provide ‘‘a better solution than

the technique used in the past of (holding and) substituting an

alternate juror’’ (App. A, 19a), petitioner submits that it is

constitutional only where the defendant has effectively waived

his right to have the case decided by the 12 persons he helped

select, who have heard the entire case, and who will deliberate

until reaching a unanimous verdict. Once a jury has commenced

13

deliberations, the loss of a deliberating member is a qualitatively

different loss from mere numbers, curtailing a defendant’s rights

and going to the very structure of the jury trial. Reduction after

the jury begins deliberations, particularly where the jury has not

reached a verdict after several days of deliberations, impinges on

unanimity, not number.

The Advisory Committee which wrote the 1983 Amendment

to Rule 23(b) relies only upon Williams v. Florida, supra, and

convenience for its authority in allowing an 11 person verdict in

the case of disability during deliberations. But Williams only stands

for the proposition that a state, in a state criminal trial, may

provide for a jury.of a lesser number than 12. Nothing in Williams,

nor in any other case decided by this Court, allows less than

unanimous verdicts in a federal criminal case. The nature and

importance of the substantive right to a verdict of all the jurors

who hear the evidence is plainly demonstrated by the procedural

safeguards which have been established by many of the Circuit

Courts of Appeals requiring that the defendant appear in open

court and expressly and intellegently give his personal consent

to a verdict of less than 12 jurors should a juror become disabled

during deliberations [United States v. Smith, 523 F. 2d 788 (Sth

Cir. 1975); United States v. Guerrero-Teralta, 446 F. 2d 876 (9th

Cir. 1971); United States v. Taylor, 498 F. 2d 390 (6th Cir. 1974)],

or, in the alternative, requiring counsel to convince the trial court

that the defendant is aware that he is waiving his absolute right

to a verdict rendered by a 12 person jury. United States v. Vega,

447 F. 2d 698 (2d Cir. 1971); United States v. Pacente, 503 F.

2d 543 (7th Cir. 1974). A solution to the occasional problem of

loss of a juror during deliberations that deprives a defendant of

his right to have his case decided by ali of the same 12 jurors

who heard the evidence, speeches and instructions, is the most

destructive of all possible solutions.

This argument is buttressed by the flat command of Rule

14

31(a) of the Federal Rules of Criminal Procedure that requires

that ‘“‘the verdict shall be unanimous.’’ Unanimity is compromised

by the amended Rule 23(b), and these two rules cannot be

reconciled. Regardless of the resources expended on a particular

trial or its protracted nature, unanimity simply cannot be cast

aside absent a valid waiver. Petitioner suggests that certiorari

should be granted to consider the constitutionality of amended

Rule 23(b) to resolve an important constitutional and procedural

issue that is likely to recur.

CONCLUSION

For the foregoing reasons, petitioner respectfully submits that

this Court should issue a writ of certiorari to the Court of Appeals

for the Third Circuit to review the instant decision.

Respectfully submitted,

JOHN ROGERS CARROLL

CARROLL & CARROLL

Attorneys for Petitioner

la

APPENDIX A—OPINION OF THE UNITED STATES COURT

“OF APPEALS FOR THE THIRD CIRCUIT

FILED APRIL 28. 1986

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

Nos. 85-5532, 85-5702. 85-5714

UNITED STATES OF AMERICA

v.

SMITH, WILLIAM T., JR.

WILLIAM T. SMITH, Appellant

in 85-5532 and 85-5714

UNITED STATES OF AMERICA

v.

STONEMAN, ALAN R.

Alan R. Stoneman, Appellant in 85-5702

On Appeal from the United States District Court

for the Middle District of Pennsylvania - Scranton

D.C. Ciiminal Nos. 84-00156-04, 84-00156-05

Argued March 18, 1986

Before: HUNTER, MANSMANN,

Circuit Judges, and

POLLAK,* District Judge

Opinion filed APRIL 28, 1986

“Honorable Louis H. Pollak, United States District Judge for the

Eastern District of Pennsyivania, sitting by designation.

2a

Appendix A

James J. West (Argued)

U.S. Attorney

David C. Shipman

Assistant U.S. Attorney

P.O. Box 11754

Harrisburg, PA 17108 sears

Attorneys for United States of America

John Rogers Carroll (Argued)

Carroll & Carroll

615 Chestnut Street. Suite 1206

Philadelphia. PA 19102

Attorneys for William T. Smith, Jr.

John Brown (Argued)

Christian Menard

Brown & Martinez

500 Esplanade Drive, Suite 1200

Oxnard, CA 93030

Attorneys for Alan R. Stoneman

OPINION OF THE COURT

HUNTER, Circuit Judge:

I. INTRODUCTION

1. XET. Ltd. d/b/a CTA. Ltd.. Computer

Technology Associates. Inc., John R. Torquato. Jr..

William T. Smith, Alan R. Stoneman. Judy Ellis. and

David Herbert were charged in a thirty-nine count

indictment with conspiracy. 18 U.S.C. § 371 (1982),

fifteen violations of the Interstate Transportation and

Aid of Racketeering (“I.T.A.R.” or “Travel Act”) statute,

18 U.S.C. § 1952(a)(3) (1982) and the mail fraud

statute. 18 U.S.C. § 1341 (1982). The indictment

outlined a conspiracy involving fifty-one overt acts.

seven mail fraud violations. and nine i.T.A.R.

violations.

3a

Appendix A

2. The conspiracy count alleged that the

defendants sought to obtain Federal Insurance

Contribution Act (“FICA”) recovery contracts’ from

state and local entities. not by placing bids, but by

bribing public officials with cash, stock, stock options.

campaign contributions, employment. and paid travel.

The defendants directed their efforts at obtaining the

contracts for Allegheny County, the City of Pittsburgh.

and the Pennsylvania school employees. The

indictment alleged that the conspiracy existed from

January 1983 until October 22, 1984.

3. Torquato, Ellis, and Herbert entered guilty

pleas to various counts. Smith and Stoneman pleaded

not guilty to all counts. Their trial began on March 26,

1985 and was completed on June 24. 1985. At trial. the

government called twenty-two witnesses against Smith

and Stoneman. including their principal witness.

Torquato, to support the government's allegations that

Smith had offered a total of $400,000 in bribes to the

Treasurer and Attorney General of Pennsviyania and

that Stoneman had participated in the bribery scheme.

The defendants called eighty-eight witnesses including

many public officials who had dealt with Torquato on

the FICA recovery contracts.

4. Thejury found Smith guilty of conspiracy, four

counts of mail fraud and four I.T.A.R. counts.

Stoneman was found guilty only of conspiracy. The

court sentenced Smith. who could have received up to

1. The amount of FICA tax paid by the emplovees of state and

local governments in Pennsvivania is matched by the employing

State or political subdivision. However. the tax need not be paid for

employees subject to certain benefits for illness. If the government

mistakenly pays the FICA taxes. it can claim a credit against future

taxes and a refund for the employee. The procedure of obtaining the

credits and refunds is known as FICA recovery. The defendant

corporations sought contracts to prepare and submit FICA

recoveries on behalf of state and local governments. The fees

charged are determined by public bidding.

4a

Appendix A

two million dollars from the scheme, to a twelve-year

prison term and a $63,000 fine. Stoneman was

sentenced to a prison term of four months and fined

$10,000. The government presented no evidence that

Stoneman was to receive any payment other than his

usual attorney fees.

Il. EVIDENCE PRESENTED

5. In early 1983, Smith and Torquato met to

discuss how to obtain Pennsylvania state contracts to

recover overpaid Social Security taxes. The two had

been friends and business associates for over twenty

years. Torquato is the son of a former Democratic

County Chairman of Cambria County. Smith was then

the Republican Chairman of Dauphin County. They

agreed to make political contributions to officials in a

position to award the contracts. Torquato introduced

Smith to David I. Herbert, the State Director for Social

Security, who controlled FICA recovery for

Pennsylvania's public employees. The three men

discussed other political subdivisions where they

might obtain contracts. From January 1983 to October

1984, Smith and Torquato concentrated on obtaining

contracts for Allegheny County, the City of Pittsburgh.

and Pennsylvania state employees.

6. CTA, Ltd. obtained and performed a contract

for FICA recovery for Allegheny County. This company

had been formed by Stoneman on November 29, 1982.

Torquato sent a copy of the proposal to Smith for

review and wrote to him about contracts in other areas.

Torquato paid $852.00 for James Scanlon, head of

Aliegheny County Computer Services, to take a trip to

New York with his family. Stoneman paid this bill on

August 31, 1983. Scanion recommended that CTA.

Ltd. be given the contract over other companies giving

lower bids. Stoneman executed the contract on behalf

of CTA, Ltd.

eiceeestnemeeneienneneneeaae

Sa

Appendix A

7. Torquato offered Gene Scanlon. James

Scanlon’s brother, a number of benefits including a

$50.000 a year job at CTA. Ltd. for Jim Scanlon.

mailing lists for his daughter's business. use of a

rented car, payment for an airline ticket. and finally

$100.000 to set up a “widget factory” in Hong Kong.

Allegheny County paid CTA, Ltd. for the contract in

November 1983. The next month. Torquato sent Smith

$1,000 for his services along with a letter discussing

how to influence Herbert.

8. Stoneman set up a California corporation.

Com-Max, Inc., on January 5. 1984. but did not file the

corporate documents that wouid have identified the

officers of the corporation and disclosed its connection

to CTA. Ltd. He sent 1.500 shares of Com-Max. Inc. to

Herbert on January 22. 1984 with a letter stating that

the stock would be bought back in three years for at

least $15.000. A similar letter plus 1.500 shares was

sent to Scott O'Donnell. Chief Clerk of Allegheny

County.

9. CTA. Ltd. also obtained a FICA recovery

contract for the employees of Pittsburgh. The company

was to be paid $150.000 even though another

contractor. who eventually did the job for the city. had

bid $35,000. In fact. after CTA. Ltd. obtained the

contract. Torquato hired this bidder as a

subcontractor to do the work for $35.000. Stoneman

sent Robert Rade Stone. President of the Pittsburgh

City Council, a $6.374.86 check drawn on Stoneman’s

own bank account and stock options for 35.000 shares

of Com-Max stock. Stoneman also sent stock options

for 25.000 shares to Richard Schmeiser. Director of

Finance for the City of Pittsburgh. Some of the profits

from the FICA contracts were to be used to make the

Com-Max stock valuable and. therefore. to benefit the

public officials who were given Com-Max stock and

stock and options

6a

Appendix A

10. During 1983, the defendants tried to obtain

the FICA recovery contract for all Pennsylvania state

employees. Torquato and Smith wanted a fee of

$8,000,000 for the job. In November 1983, however,

they discovered that the contract was to be performed

in-house at a cost of $300,000. To secure the contract.

Smith and Torquato had visited the Republican State

Chairman, Robert Asher, in July 1983 and offered him

$500,000 from the contract for the Republican Party.

They decided that. in order to obtain the FICA recovery

contracts, they needed to have jurisdiction over the

contracts moved from the governor to the State

Treasurer, R. Budd Dwyer, a friend of Smith's. Smith

met with Senate Minority Whip Eugene Scanlon. David

Herbert, and Jim Scanlon to discuss legislation to

accomplish the change. After the legislation passed.

Torquato purchased $500 worth of tickets to: House

Majority Leader Jim Manderino’s fund raiser.

11. Torquato and Smith met with the Treasurer

of Pennsylvania on March 2, 1984. and discussed a

$300,000 payment to be divided among the Treasurer.

the Treasurer's reelection campaign. and the

Republican State Committee. Herbert continued to aid:

Torquato and Smith and on May 10, 1984 the

Treasurer awarded the Pennsylvania contract to the

Pennsylvania company formed by Smith in April 1984,

Computer Technology Associates, Inc. Herbert was to

be given $100,000 in a Swiss bank account. The

contract, awarded on a no-bid basis, would have

generated $4,000,000 in profit, to be split between

Smith and Torquato, at an expense to the

Commonwealth of $6.000,000. The contract was

ultimately performed by an accounting firm.

Levin-Horwath, for $1.300,000 with a possibility of up

to thirty-five percent being rebated.

12. To avoid any competition in collecting FICA

overpayments, Smith attempted to obtain a ruling

7a

Appendix A

from the Attorney General of Pennsylvania, Leroy

Zimmerman, that the contract was exclusive. Smith

told Patrick Boyle, Press Secretary to the Attorney

General. that Torquato would give S$100.000 to the

Attorney General's reelection campaign. The Attorney

General ruled that the Treasurer's Counsel could

decide the issue. The Treasurer's Counsel then ruled

that the contract was exclusive.

13. When Smith and Torquato heard that their

contract might be investigated, they were concerned

that officials might discover that Com-Max was a

holding company for CTA, Inc., the company handling

the school employees contract. In June 1984, Smith

formed a new corporation Application Software

Systems. Inc. (A.S.S.I.). The FBI searched Torquato’s

residence on July 6. 1984 and found records of

payments to be made to various Pennsylvania officials.

The defendants were indicted on October 22, 1984.

Ill. VARIANCE BETWEEN THE INDICTMENT AND

THE PROOF

14. Smith and Stoneman claim that the

conspiracy charged in the indictment impermissibly

varied from the evidence at trial because the evidence

proved multiple conspiracies. There are two possible

ways in which the evidence at trial may vary from the

indictment. First. an amendment may alter the terms

of the indictment and, therefore. constitute a per se

violation of the fifth amendment grand jury clause. See

Stirone v. United States, 361 U.S. 212. 217 (1960):

United States v. Castro, 776 F.2d 1118, 1121 (3d Cir.

1985): United States v. Somers, 496 F.2d 723. 743 (3d

Cir.), cert. denied. 419 U.S. 832 (1974). Second. a

variance may exist if the evidence at trial proves facts

different from those alleged in the indictment. The evil

of a variance is that defendants may be deprived of

notice of the charges against them and may be subject

8a

Appendix A

to double jeopardy. See Gaither v. United States, 413

F,2d 1061,.1071 (D.C. Cir. 1969). Variances are not

subject to the Stirone per se rule. They are examined on

a case-by-case basis and constitute reversible error

only if the defendant was prejudiced. See Castro, 776

F.2d at 1121; Somers, 496 F.2d at 743. The Supreme

Court recently considered the variance issue in United

States v. Miller, 105 S.Ct. 1811 (1985). The Miller

Court acknowledged that. under Stirone, trial evidence

could not amend the indictment by broadening the

bases for conviction. However, the court recognized

that an indictment may permissibly allege more crimes

than are actually proven at trial. Id. at 1815.

15. In the case before us, the court below properly

instructed the jury that it could find that there was one

master conspiracy and more than one subsidiary

scheme. See United States v. Kenny, 462 F.2d 1205.

1261 (3d Cir.), cert. denied, 409 U.S. 914 (1972).

When a single conspiracy is charged in the indictment,

there is a variance if the evidence at trial proves only

the existence of multiple conspiracies. See Kotteakos

v. United States, 328 U.S. 750 (1946); United States v.

Boyd, 595 F.2d 120, 123 (3d Cir. 1978). However, a

finding of a master conspiracy with sub-schemes does

not constitute a finding of multiple, unrelated

conspiracies and, therefore, would not create an

impermissible variance. The question of whether a

single conspiracy or multiple conspiracies existed is a

fact question to be decided by the jury. This court must

sustain the jury's verdict if there is substantial

evidence, viewed in the light most favorable to the

government, to support the finding of a single master

conspiracy with subsidiary schemes. See United

States v. Brooks, 697 F.2d 517, 523 (3d Cir. 1982),

cert. denied, 460 U.S. 1071 (1983). The evidence

supported a finding of a single conspiracy which was

formed with the goal of obtaining FICA recovery

9a

Appendix A

contracts through bribery and fraud. The fact. that the

group sought more than one contract does not

necessarily mean that there was more than one

conspiracy.

16. The defendants contend that while the

indictment charged one conspiracy. the evidence

showed that three separate conspiracies existed: one to

obtain the Allegheny County contract. one to obtain

the Pittsburgh contract, and one to obtain the

Pennsylvania employees contract. Smith claims that he

was not part of the Allegheny contract or the

Pittsburgh contract. He relies on United States v.

Camiel, 689 F.2d 31 (3d Cir. 1982), for his argument

that a variance exists. In Camiel we found a prejudicial

variance when an indictment charged a single scheme

for creating no-work jobs on the government payroll.

while the evidence at trial supported an inference of

two or more conspiracies. The evidence could not

support a reasonable inference of a single scheme

because the alleged coparticipants were members of

two antagonistic factions which would not work

together. Camiel is clearly distinguishable from the

case before us as there is no evidence of antagonistic

groups. We find that the evidence presented does

support the jury's finding of a single conspiracy.

17. Smith claims that his only possible

involvement in the Allegheny or Pittsburgh schemes

was in forming Application Software Systems. Inc.

(“A.S.S.1."). He contends that since concealment of the

crime after the object of the conspiracy has been

attained is not part of the conspiracy. see Grunewald

v. United States, 353 U.S. 391 (1957): United a.

Pflaumer, 774 F.2d 1224. 1232 (3d Cir. 1985). h

cannot be placed in the Allegheny and Piteburah

schemes. This argument fails since the evidence

supports a finding ofa single conspiracy and a finding

that Smith was involved in all three schemes well

10a

Appendix 4

before the formation of A.S.S.I. During and after the

formation of A.S.S.I. the defendarits continued to

attempt to obtain FICA recovery contracts.

IV. SUPPLEMENTAL JURY INSTRUCTIONS ON

MASTER CONSPIRACY

18. On June 13, 1985 the trial court instructed

the jury on the conspiracy as follows:

The indictment alleges the existence of a

conspiracy to commit mail fraud. and

additionally, charges mail fraud itself. An

essential element of both charges is that the

Government must prove beyond a reasonable

doubt the existence of a single scheme to

defraud as charged in the indictment.

A Defendant may not be convicted unless he

was a willing, knowing and active participant

in the particular scheme to defraud alleged in

this indictment.

Unless the jury finds beyond a reasonable

doubt that the Government has proved the

existence of a single scheme to defraud. as

charged in the indictment, the Defendant

must be acquitted of the pertinent counts.

The single scheme charged includes the

obtaining of FICA recovery contracts from

Allegheny County, the City of Pittsburgh and

also the Commonwealth of Pennsyivariia.

If you find that Mr. Torquato and others were

involved in separate conspiracies concerning

or regarding Allegheny County or City of

Pittsburgh, or Pennsylvania School District

FICA recovery contracts, and that the

Defendant was not a participant in one or

more of these separate conspiracies, then

lla

Appendix A

your verdict as to the Defendant on the entire

indictment must be not guilty.

By separate conspiracy, | mean a conspiracy

that has no connection with another

conspiracy except for the fact that John

Torquato, Jr.. or one or more other

individuals, played a role in both

conspiracies.

You may, however, find that the Defendant

participated in the conspiracy charged in the

indictment even if that conspiracy

encompassed three related subconspiracies

involving different groups of individuals.

Both Smith and Stoneman object to the following

supplemental instructious given to the jury the next

day on the issue of a master conspiracy with subsidiary

schemes:

A single conspiracy is one in which the

Defendants and those with whom they are

charged with conspiring share a common

goal of the conspiracy set forth in the

indictment. Separate conspiracies. although

they may have common elements, common

participants, common means, some common

objectives. or other common factors, but

which lack the critical element of common

objectives of the conspiracy on the part of all

of the participants. do not qualify as.a single

conspiracy.

The gist of a criminal conspiracy may

involve numerous transactions and the fact

that conspirators individually or in groups

perform different tasks in pursuing a

12a

Appendix A

common goal does not necessitate a finding

of several conspiracies.

Even if. a small group is at the heart of an

unlawful agreement, others who knowingly

participate with core members to achieve a

common goal may be members of a single

conspiracy.

Accordingly, you may find that a master

conspiracy for the obtaining of FICA recovery

contracts by a bribery and fraud existed and

that more than one subsidiary scheme was

involved. You should review the indictment

and determine if the master conspiracy

charged therein has been proven.

19. The defendants claim that these instructions

lacked the “concrete accuracy” required of

supplemental instructions. See Bollenbach v. United

States, 326 U.S. 607, 613 (1946). They contend that

the jury's question concerning whether the defendants

had to be involved in all three FICA recovery contracts if

they were to’ be found guilty of conspiracy shows that

instructions confused the jury. They further claim that

the instructions on master conspiracy and subsidiary

scheme presented a new theory of liability wholly

different from the theory argued at trial. This alleged

change in theory, they maintain, violated Federal Rule

of Criminal Procedure 307 because defense counsel was

2. Rule 30 provides:

At the close of the evidence or at such earlier time during

the trial as the court reasonably directs. any party may file

written requests that the court instruct the jury on the law as

set forth in the requests. At the same time copies of such

requests shall be furnished to adverse parties. The court

shail inform counsel of its proposed action upon the request

prior to their- arguments to the jury, but the court shail

instruct the jury after the arguments are completed. No party

l3a

Appendix A

not given notice of the instruction before closing

argument. Material modifications of instructions will

give rise to a violation of Rule 30 because the defendant

is not given an opportunity to address the charge.

Finally, the defendants argue that the instruction

described an offense different than the one charged in

the indictment and therefore created an impermissible

variance under Kotteakos and Stirone.

20. We are unpersuaded by these arguments and

find that the defendants were not prejudiced by the

giving of the supplemental charge. We first note that

the instruction given was a correct statement of the

law. See United States v. Kenny, 462 F.2d 1205 (3d

Cir.), cert. denied, 409 U.S. 914 (1972). Moreover, the

supplemental instruction on a master conspiracy and

subsidiary scheme did not present a new theory of

criminal liability and was not a material modification

of the original instructions. The supplemental

instruction was merely an elaboration of the earlier

instruction. The instruction explained that a single

conspiracy rather than multiple, unrelated

conspiracies had to be found. However, the instruction

also stated the single conspiracy could consist of a

master conspiracy with one common objective but with

several subsidiary schemes.

21. The defendants had notice of the multiple

conspiracy issue. The issue was raised in the briefs for

pretrial motions. At that time the government cited to

Kenny. The defendants themselves had proposed

supplemental instructions which addressed the need

to find a single conspiracy. At the charge conference.

May assign as error any portion of the charge or omission

therefrom unless he objects thereto before the jury retires to

consider its verdict. stating distinctly the matter to which he

objects and the grounds of his objection. Opportunity shall

be given to make the objection out of the hearing of the jury

and. on request of any party, out of the presence of the jury.

l4a

Appendix A

the parties referred to the question of whether each

FICA recovery contract was a subpart of the conspiracy.

Indeed, it was defense counsel who requested a

supplementary instruction on what constituted a

separate conspiracy. The charge made it clear to the

jury that a single conspiracy must have a common

objective. The instruction on subsidiary schemes did

not state a new theory and defense counsel had notice

of the issue. There was, therefore, no violation of Rule

30:

V. JURY INSTRUCTIONS ON THE

TRAVEL ACT VIOLATIONS

22. Counts 11 to 16 of the indictment charged

Smith with violations of the Travel Act, 18 U.S.C.

§ 1952.4 Smith was acquitted on Counts 11 and 16,

3. Supplementary instruction #32 stated:

Even if you find that multiple conspiracies existed, you still

must individually consider the substantive violations

contained in counts 2 through 16. and determine if a

particular defendant is criminally responsible for these

distinct uses of the United States mail and the facilities of

interstate commerce.

We need not address the defendant's argument that instruction

#32 was improper since the jury found the defendants guilty of

conspiracy and therefore did not need to follow instruction #32.

4. 180U.S.C. § 1952 states:

(a) Whoever traveis in interstate or foreign commerce or

uses any facility in interstate or foreign commerce. including

the mail, with intent - ;

(1) distribute the proceeds of any unlawful activity: or

(2) commit any crime of violence to further any unlawful

activity: or

(3) otherwise promote, manage. establish. carry on. or

facilitate the promotion. management. establish-

ment, or carrying on, of any unlawful activity.

lSa

Appendix A

which referred to Torquato’s travel on January 24 and

June 7, 1984. He was convicted, however, on Counts

12 through 15 which referred to Torquato’s travel on

February 27, March 19, April 17, and April 29, 1984.

23. The district court instructed the jury on the

Travel Act violations as follows:

The term ‘interstate commerce’ means trans-

portation or movement including the use of

interstate telephone facilities and the

movement of mail between one state and

another state and while it must be proved

that an individual used the facility of

interstate commerce with the specific intent

to promote, manage, establish or carry on an

unlawful activity, it need not be proven that

such purpose was the only reason promoting

the facility of commerce to be used.

Smith claims that the jury should have been

specifically instructed that there had to be an act of

bribery subsequent to each trip by Torquato. Smith

argues that the district court did not properly charge

on the requirement that there be a sufficient nexus

between the interstate travel and the unlawful activity.

Smith claims that the district court erred in refusing to

give a supplemental instruction stating:

There must be a connection between the

travel and the subsequent act of bribery. It

would not be enough, for example. for the

government to prove that travel occurred on a

particular occasion and at some subsequent

time an act of bribery occurred unrelated to

and thereafter performs or attempts to perform any of the

acts specified in subparagraphs (1). (2). and (3). shail be

fined not more than $10.000 or imprisoned for not more

than five years. . .

l6a

Appendix A

the travel. The travel may not be merely

incidental to the unlawful activity. There

must be a coincidence between the travel and

the act of bribery in the sense that the

purpose of the travel (or use of interstate

facility) was to perform the act of bribery and.

thereafter. an act of bribery was performed

that was contemplated when the travel took

place.

24. There is no requirement that the interstate

travel forming the basis of a Travel Act violation be

essential to the unlawful scheme. It need only make

easier or facilitate the unlawful activity. See United

States v. Perrin, 580 F.2d 730. 736 (5th Cir.). affd.

444 U.S. 37 (1978) (Travel Act violation based on act of

telephoning map service out of state). However. the

nexus between the travel and the unlawful scheme may

be so “isolated. minimal. inconsequential. and

nonessential” to the scheme that it is “insufficient to

establish jurisdiction under the Travel Act.” Id. at 735.

See also Rewis v. United States. 401 U.S. 808 (1971)

(although the defendant ran a gambling

establishment. his out-of-state customers were an

insufficient basis for charging a Travel Act violation):

United States v. Isaacs. 439 F.2d 1124, 1146 (7th

Cir.). cert. denied. 417 U.S. 976 (1974) (no Travel Act

violation based on accepting a “Leck that cleared

through an out-of-state Federal Reserve Bank): United

States v. McCormick, 442 F.2d 316 (7th Cir. 1971) (no

Travel Act violation based on advertising for an illegal

lottery ticket salesman in a newspaper with 2-3%

out-of-state subscribers).

25. In United States v. Wander. 601 F.2d 1251

(3d Cir. 1979), this court found that there was a

sufficient interstate nexus to establish a Travel Act

violation based on acts similar to those in question in

17a

Appendix A

the case before us. In Wander a group of conspirators

were acting in Pittsburgh. One member, Currie, went

to Florida for reasons unrelated to the conspiracy.

Nevertheless, telephone calls to Currie and travel by

Currie in returning to Pittsburgh formed the basis for

a Travel Act charge. We found that while the “extortion

scheme could have been carried out without any

interstate involvement had Currie remained in

Pittsburgh .... once Currie moved to Florida it

became essential to the implementation of the

defendants’ scheme that they use interstate facilities to

secure her presence in Pittsburgh.” Id. at 1255.

Similarly, interstate travel was not an absolute

necessity to the bribery scheme we are now

considering, but because one of the participants,

Stoneman. was in California. interstate travel did

facilitate the planning and implementation of the

scheme.

26. The district court has wide discretion in

charging the jurv. We will find that the court erred in

refusing to give an instruction only if the instruction

was correct, not substantially covered by other

instructions, and was so important that the omission

of the instruction prejudiced the defendant. See

United States v. Sans, 731 F.2d 1521. 1539 (11th

Cir.), cert. denied, 105 S.Ct. 791 (1984). The district

court in this case adequately charged the jury on the

need for a nexus between the travel and the bribery

when it stated “transportation . . . between one state

and another state” requires proof that the “individual

used the facility of interstate commerce with the

specific intent to promote, manage. establish or Carry

on an unlawful activity... .” The evidence shows that

Torquato, alone or with Smith did meet with

government officials as part of the bribery scheme after

each of the trips.

18a

_ Appendix A

VI. ELEVEN PERSON JURY

27. On the fourth day of jury deliberation. after.a

three-month trial. one of the jurors was severely

injured in an automobile accident. The defendants

refused to stipulate to an eleven-person jury. The

district court judge permitted the jury to continue

deliberation with only eleven jurors pursuant to

Federal Rule of Criminal Procedure 23(b}. which states: -

(b) Jury of Less Than Twelve. Juries shall

be of 12 but at any time before verdict the

parties may stipulate in writing with the

approval of the court that the jury shall

consist of any number less than 12 or that a

valid verdict may be returned by a jury of less

than 12 should the court find it necessary to

excuse one or more jurors for any just cause

after trial commences. Even absent such

stipulation. if the court finds it necessary to

excuse a juror for just cause after the jury has

retired to consider its verdict. in the

discretion of the court a valid verdict may be

returned by the remaining 11 jurors.

Rule 23(b) was amended in 1983 to give judges the

discretion to allow eleven person juries to continue

deliberation if one juror became unavailable. Before

1983, eleven person juries were permitted only by

stipulation. Stoneman and Smith challenge the

constitutionality of Rule 23(b).

28. Only two courts have considered the

constitutionality of the discretionary part of Rule

23(b). A district court applied Rule 23(b) when one

juror saw some notes of the United States Attorney

after deliberations had begun. See United States v.

Bambino, 598 F. Supp. 646 (D.N.J. 1984). The Second

Circuit recently considered the constitutionality of

19a

Appendix A

Rule 23(b) at length in United States v. Lowell. Nos.

84-1441, 1459, 1460, 1463. 1365 (2d Cir. December

13, 1985), cert. denied, 54 U.S.L.W. 3562 (U.S.

February 24, 1986). We agree with both of these courts

that Rule 23(b) is constitutional.

29. The Supreme Court has held that a

six-member jury is constitutionally permitted. See

Williams v. Florida, 399 U.S. 78 (1970). It is clear to us

that twelve jurors are not required for a conviction.

Contrary to the defendant's contentions. Rule 23(b)

does not allow a less than unanimous verdict. Rule

23(b) was amended to deal with those situations in

which a juror became unavailable after a lengthy trial

and a mistrial would be extremely burdensome. Rule

23(b) provides a better solution than the technique

used in the past of substituting an alternate juror even

after deliberations had begun. See United States v.

Hillard.701 F.2d 1052 (2d Cir.), cert. denied. 461 U.S.

958 (1983). We find no constitutional defect in the

rule.

Vil. DISCLOSURE OF ALCOHOL TREATMENT

RECORDS OF GOVERNMENT WITNESSES

30. Smith and Stoneman claim that the denial of

their motion to order disclosure of the alcoholism

treatment records of government witnesses John R.

Torquato, Jr. and Judy Ellis deprived the defendants of

their sixth amendment rights. Torquato and Ellis

admitted that they had been alcoholics and had

attended a rehabilitation center. the Care Unit Hospital

of Orange. California (“Care Unit”), before the trial. The

defendants cross-examined Torquato and Ellis on their

alcoholism and had the opportunity to question the

other witnesses. who had dealt with Torquato and

Ellis. on any effects of the alcoholism. However. the

defendants sought to obtain the treatment records of

Torquato and Ellis from the Care Center. They were

20a

Appendix A

most concerned with the records of Torquato. the

government's principal witness. They claimed that

without the records they would be deprived of their

sixth amendment rights to confrontation and

compulsory process of witnesses.

31. The records of patients in drug rehabilitation

programs that are assisted by the federal government

must be kept confidential. See 42 U.S.C.A.

§ 290dd-3(a) (West Supp. 1985). A court may order

disclosure pursuant to $ 290dd-3(b)(2)(c) and the

regulations at 42 C.F.R. § 2.61 (1985) if “good cause”

has been shown. “In assessing good cause the court

shall weigh the public interest and need for disclosure

against the injury to the patient. to the

physician-patient relationship. and to the treatment

services.” Id. The application should be denied when

“other competent evidence of sources of information

are available... .” 42 C.F.R. § 2.64(e) (1985). Records

can be disclosed only if they contain objective data

unless they fall within the exception in 42 C.F.R.

§ 2.63 (1985) which provides that. “(wjhen a patient in

litigation offers testimony or other evidence pertaining

to the content of his communications with the

program,” the records may be disclosed. Because

Torquato did not testify on his communications while

in the program. this exception does not apply.

Therefore. the defendants can seek the disclosure of

only those portions of the records. if any. that contain

objective data.

32. Although Torquato stated that he would

waive the physician-patient privilege. there is a public

interest in maintaining the confidentiality of patient

records at the Care Unit. The defendants have not

made a sufficient showing of need for the records. They

wished to use the records to impeach Torquato’s

credibility. Torquato had admitted that he had been

an alcoholic. Moreover he was subject to cross-

2la

Appendix A

examination for seven days and the defendants had the

opportunity to examine other witnesses on Torquato’'s

alcoholism. Therefore, we do not find that the

defendants have shown good cause for disclosing the

records or that their right o cross-examine Torquato

was impaired. The public interest in confidentiality

outweighs the defendant's needs when the records

would provide little new material that could be used to

impeach the witness's credibility. See United States v.

Graham, 548 F.2d 1302, 1314 (8th Cir. 1977); Bell v.

State, 385 So.2d 78 (Ala. App. 1980). A defendant is

not entitled to obtain evidence that would only

marginally impugn a witness's credibility but that

would severely prejudice a public interest requiring

confidentiality. Cf. United States v. Adams, 759 F.2d

1099 (3d Cir.), cert. denied. 106 S.Ct. 275 and 106

S.Ct. 336 (1985) (court limited cross-examination of

witness in the Witness Protection Program).

Vill. SEVERANCE OF STONEMAN'S TRIAL

33. Stoneman claims that he was prejudiced

when the trial court denied his motion to have his trial

severed pursuant to Federal Rule of Criminal

Procedure 14. He conjectures that the consolidated

trial confused the jury because the government used

the term “CTA” to refer to both CTA, Ltd. and

Computer Technology Associates, Inc. Stoneman did

not object to the use of the name CTA during trial.

Furthermore, we do not believe that the use of the term

resulted in undue prejudice to Stoneman.

34. Stoneman also maintains that he was

prejudiced by being tried with Smith because the

extensive damaging evidence against Smith and

testimony on Torquato’s actions “rubbed off” onto

Stoneman tc render him guilty by association. See

United States v. Mardian. 546 F.2d 973 (D.C. Cir.

1976), citing United States v. Kelly, 349 F.2d 720.

22a

Appendix A

756-59 (2d Cir. 1965), cert. denied, 384 U.S. 947

(1966). We review the trial court decision not to sever

the trial only for an abuse of discretion. See United

States v. Boyd, 595 F.2d 120, 125 (3d Cir. 1978):

United States v. Somers. 496 F.2d 723 (3d Cir.). cert.

denied, 419 U.S. 832 (1974). As long as the

government has charged conspiracy in good faith. an

allegation of conspiracy is a sufficient reason for trying

the conspiracy and all substantive offenses together.

See Somers, 496 F.2d at 729-30. In determining

whether a particular defendant was prejudiced by a

joinder of defendants, we look to whether the jury could

compartmentalize the evidence against each

defendant. A defendant is not entitled to a severance

merely because the evidence against his codefendants

is more damaging than the evidence against him. See

United States v. DiPasquale. 740 F.2d 1282. 1293 (3d

Cir. 1984), cert. denied. 105 S.Ct. 1226 (1985): United

States v. Dansker, 537 F.2d 40. 62 (3d Cir. 1976). cert.

denied, 429 U.S. 1038 (1977). We conclude that the

jury could understand what evidence concerned each

defendant and. therefore. that Stoneman was not

prejudiced by the denial of his motion to sever the trial.

IX. SUFFICIENCY OF THE EVIDENCE TO

CONVICT STONEMAN

35. Stoneman contends that there is insufficient

evidence to support his conviction. In addressing this

contention we must determine if there was sufficient

evidence on which reasonable persons could find

Stoneman guilty beyond a reasonabie doubt. In doing

so, we must view the evidence in a light most favorable

to the government. See Glasser v. United States. 315

U.S. 60, 80 (1942). The district court found that the

verdict was supported by substantial evidence.

36. The evidence showed that Stoneman

incorporated the California corporation, Com-Max.

23a

Appendix A

Inc. He sent stock in the corporation to Pennsylvania

officials including David I. Herbert. the State Director

of Social Security, Robert Rade Stone. the President of

Pittsburgh City Council. Scott O'Donnell. the

Administrator of Allegheny County, and Ronald

Schmeizer, an employee of the City of Pittsburgh. He

also sent a check for $6,374.86, drawn on his own

bank account, to Stone. Torquato testified that

Stoneman was aware of the reason for sending stock.

stock options, and the check to the Penrisylvania

officials. Torquato also testified that Stoneman

suggested his own bank account be used for the check

to make it difficult to trace the payment to Torquato.

The government noted that the cover letters to the

officials refer to Stoneman and not Torquato. that the

deposit slip for $6,374.86 was entered as a split

deposit, and that the schedule of officers for Com-Max.

Inc. was never filed with the California Secretary of

State. The government claims that these actions were

taken to avoid creating a paper trail to the company.

Stoneman maintains that this argument is weak. since

Stoneman’s actions avoided any paper connection

between Torquato and Com-Max. Inc., but provided

ample evidence of a link between Stoneman himself

and the corporation. There was evidence that

Stoneman did not cooperate with the FBI

investigation.

37. Stoneman contends that all of his actions

were the normal activities of an attorney for a small

corporation. He claims that he had no knowledge of

who the Pennsylvania officials were or that any bribery

scheme existed. A person is not guilty of conspiracy

unless he had knowledge of the illicit purpose of the

conspiracy when he performed acts that furthered that

purpose. See United States v. Klein. 515 F.2d 751.

753 (3d Cir. 1975). There was no direct evidence that

Stoneman had knowledge of some improper purpose.

24a

Appendix A

Stoneman also observes that the government offered

no evidence of motive. See United States v. Wise, 108

F.2d 379 (7th Cir. 1939). There was no evidence that

Stoneman received, or would ever have received.

anything more than his normal attorney fees. However.

the jury was entitled to make a finding of knowledge

and therefore guilt based on circumstantial evidence

and credibility. Clearly, the jury did not believe

Stoneman’'s explanations of his actions. We find that

the jury could properly infer guilt from the evidence

presented. See United States v. Ordones, 469 F.2d 70,

71 (9th Cir. 1972) (jury need not believe defendant's

story that he had no knowledge).

X. CONCLUSION

38. For the reasons discussed above we will

affirm the judgment of the district court in all respects.

A True Copy:

Teste:

Clerk of the United States Court of Appeals

Sor the Third Circuit

25a

APPENDIX B—OPINION OF THE UNITED STATES

DISTRICT COURT FOR THE MIDDLE DISTRICT OF

PENNSYLVANIA FILED OCTOBER 17, 1985

UNITED STATES DISTRICT COURT

FOR THE MIDDLE DISTRICT OF PENNSYLVANIA

Criminal No. 84-00156-04

(Judge Muir)

UNITED STATES OF AMERICA

VS.

WILLIAM T. SMITH

APPEARANCES:

For United States

James J. West, Esq.

Assistant U.S. Attorney

P.O. Box 11754

Harrisburg, Pa. 17108

For William T. Smith

Thomas C. Carroll, Esq.

Carroll and Carroll

1206 One Independence Mall

615 Chestnut Street

Philadelphia, Pa. 19106

26a

Appendix B

UNITED STATES DISTRICT COURT FOR

THE MIDDLE DISTRICT OF PENNSYLVANIA

Criminal No. 84-00156-04

(Judge Muir)

UNITED STATES OF AMERICA

vs.

WILLIAM T. SMITH

OPINION

MUIR, District Judge.

I. Introduction and Procedural History.

Currently pending before this Court is William T. Smith’s

motion for judgment or acquittal and in the alternative for a new

trial. On October 22, 1984, a sixteen count indictment was returned

against two corporate and five individual Defendants including

William T. Smith. Smith’s trial began on March 26, 1985 and

ended on June 24, 1985 when the jury returned a verdict of guilty

on counts |, 2, 3, 7, 9, and 12 through 15. Count | charged.

conspiracy; counts 2, 3, and 7 changed mail fraud under 18 U.S.C.

§ 1341; counts 9 and 12 through 15 charged interstate

transportation in aid of racketeering under 18 U.S.C. § 1952(a)(3).

II. Evidence Regarding Multiple Conspiracies.

Smith argues that he is entitled to a judgment of acquittal

27a

Appendix B

or a new trial because the Government did not prove a single

conspiracy as charged in count | of the indictment but instead

it proved several smaller conspiracies. He also contends that there

is a variance between the events charged in the indictment and

the proof at trial which was prejudicial to him.

The Court must grant a motion for judgment of acquittal

‘* . . if the evidence is insufficient to sustain a conviction’’ of

the offenses charged in the indictment, Rule 29(a) Fed.R.Crim.P.

The standand of review is whether, viewing the evidence in the

light most favorable to the Government, the jury’s verdict is

supported by substantial evidence. Glasser vs. United States, 315

U.S. 60, 80 (1942), United States vs. Delerme, 457 F.2d 156, 160

(3d Cir. 1972). The issue on a motion for acquittal is whether

this Court has reason to believe that there was sufficient evidence

on which reasonable persons could find Smith guilty beyond a

reasonable doubt; United States vs. Pratt, 429 F.2d 690 (3d Cir.

1970), United States vs. Leach, 427 F.2d 1107 (1st Cir. 1970).

In considering a motion for a new trial, ‘“The Court . . . may

grant a new trial . . . if required in the interest of justice.’’ Rule

33 Fed.R.Crim.P. Unlike a motion for judgment of acquittal,

the motion for new trial is based upon the weight of the evidence,

and the Court may weigh evidence and consider the credibility

of witnesses. United States vs. Pepe, 209 F.Supp. 542, 595 (D.

Del. 1962), aff’d per curiam, 339 F.2d 264 (3d Cir. 1964). The

motion for new trial is addressed to the discretion of the Court

and the power to grant a new trial on the ground that the verdict

is against the weight of the evidence should only be invoked in

exceptional cases. Wright, Federal Practice & Procedure: Criminal

2d § 553.

Smith contends that the evidence showed that there were three

28a

Appendix B

separate conspiracies embracing Allegheny County, the City of

Pittsburgh, and the Commonwealth of Pennsylvania and that

Smith was not a member of the two conspiracies involving

Allegheny County and the City of Pittsburgh. Smith alleges that

the evidence showed three separate mail fraud conspiracies rather

than the one conspiracy described in Count | of the indictment

and also showed three separate conspiracies to violate 18 U.S.C.

§ 1952 which prohibits interstate transportation in aid of

racketeering, rather than the single conspiracy charged in count

1 of the indictment. The evidence was that Smith and others

attempted as part of one overall scheme to influence state and

local public officials to award FICA recovery contracts to a

California corporation, XET, Ltd. d/b/a/ CTA Ltd., and that

Smith was working for and on behalf of the corporation with

John Torquato who was the moving force behind the scheme.

Torquato testified that Smith knew about and assisted Torquato’s

activities in bribing public officials, that bribes were paid to and

goods and services rendered to members of the Scanlon family,

Robert Rade Stone, President of the Pittsburgh City Council,

and other officials in connection with said scheme. Smith knew

that stock in the corporation known as COM-MAX was being

delivered to state, city, and county officials as bribes.

Smith was aware of the dealings between the individual

Defendants and public officials involved in various FICA recovery

contracts. The State Director of Social Security for Public

Employees, David Herbert, approved all three contracts and

received stock in COM-MAX Corporation. James Scanlon, an

Allegheny County official, recommended CTA to the City of

Pittsburgh and to the State of Pennsylvania and received free

travel and promises of employment for himself and family

members. James Scanlon was also instrumental in introducing

John Torquato and Defendant Smith to Eugene Scanlon, his

29a

Appendix B

brother and Senate Minority leader of the Senate of the

Commonwealth of Pennsylvania, who assisted in passage of

legislation to facilitate the FICA recovery by CTA on behalf of

Pennsylvania school entities.

Torquato testified that he discussed with Smith that COM-

MAX stock or stock options had been delivered to David Herbert,

the above-mentioned State Director, Robert Rade Stone, President

of the Pittsburgh City Council, Scott R. O’Donnell, Chief Cierk

to the Commissioners of Allegheny County, and Ronald

Schmeizer, Director of Finance of the City of Pittsburgh. It would

appear that these public officials were told by Torquato that the

money from the state, county, and city FICA recoveries would

be used to fund and enhance the COM-MAX Corporation. When

there were rumors of an investigation, Defendant Smith created

yet another company known as Application Software Systems to

conceal the prior delivery of COM-MAX stock to those public

officials and to make it more difficult to establish a connection

between COM-MAX and CTA. Smith formed this company with

full knowledge of its purpose in furthering the single conspiracy.

The evidence introduced during Smith’s triai showed beyond a

reasonable doubt that Smith was guilty of involvement in one

conspiracy involving the awarding of FICA recovery contracts

to CTA, Ltd.

Smith argues that there is a variance between the events as

changed in the indictment and the proof offered at trial which

prejudices a substantial right of Smith and cites United States

vs. Camiel, 689 F.2d 31 (3d Cir. 1982) as authority for this

argument. Camie/ is distinguishable from this case. In Camiei,

the Court held that the evidence showed the existence of two or

perhaps even four distinct schemes to defraud, that the evidence

was insufficient to support a finding of one scheme and entered

30a

Appendix B

a directed verdict of acquittal. The Court applied the doctrine

set forth in Kotteakos vs. United States, 328 U.S. 750, 66 S.Ct.

1239 (1946) which held that in order for a trial judge to reverse

a jury conviction in a mail fraud scheme case, (1) there must be

a variance between the indictment and the proof and (2) the

variance must prejudice some substantial right of the Defendant.

the argument that there was a variance between the indictment

and the proof. The evidence showed beyond a reasonable doubt

that there was a single conspiracy; thus, there was no prejudicial

variance between the facts set forth in the indictment and the

proof at trial.

III. The Court’s Charge Regarding Single and Multiple

Conspiracies.

Smith contends that he is entitled to a judgment of acquittal

or a new trial because this Court’s additional charge to the jury

on June 14, 1985 violated Fed.R.Crim.P. 30 and was prejudicial

to Smith.

On June 11 and 12, 1985, this Court ruled on counsels’

requested points for charge. We informed counsel that we wouid

cover Smith’s point 30 and Smith’s supplemental point 9 which

involve single and separate conspiracies. Transcript, Volume 38,

p. 5, and Volume 39, p. 3. Smith’s point 30 is as follows:

If you find that John R. Torquato, Jr. and others

were involved in a separate conspiracy or

conspiracies regarding the Allegheny County and

City of Pittsburgh FICA recovery contracts in

which the defendant, William Smith, was not a

participant, then your verdict as to William Smith

3la

Appendix B

on the entire indictment must be not guilty.

(authorities omitted)

Defendant Smith’s supplemental point 9 is as follows:

1. The indictment alleges the existence of a

conspiracy to commit mail fraud and, additionally,

charges mail fraud itself. An essential element of

both charges is that government prove beyond a

reasonable doubt the existence of a single scheme

to defraud and that the single scheme to defraud

not be substantially different from the scheme

charged in the indictment.

2. To convict on this aspect of the charges,

each of the jurors must find that the government

has proved beyond a reasonable doubt that the

defendant participated in the same single scheme

to defraud and the scheme to defraud in which

the defendant is found to have participated is the

same scheme as the fraudulent scheme alleged in

the indictment. The defendant may not be

convicted unless he was a willing, knowing and

active participant in the particular scheme to

defraud alleged in this indictment.

3. Unless the jury finds beyond a reasonable

doubt that the government has proved the existence

of a single scheme to defraud, as charged in the

indictment, the defendant must be acquitted of the

pertinent counts. (authorities omitted)

Counsel gave their closing arguments on June 12 and 13,

32a

Appendix B

1985 and during those closings, no counsel raised the issue of

multiple and single conspiracies. On June 13, 1985, this Court

instructed the jury that the indictmert charges a single scheme

to defraud and Smith must have participated in such a scheme

or one not substantially different, and that unless the single scheme

had been proven, Smith must be acquitted of the pertinent counts.

We instructed the jury as follows:

The indictment alleges the existence of a conspiracy

to commit mail fraud, and additionally, charges

mail-fraud itself. An essential element of both

charges is that the Government must prove beyond

a reasonable doubt the existence of a single scheme

to defraud as charged in the indictment.

A Defendant may not be convicted unless he was

a willing, knowing and active participant in the

particular scheme to defraud alleged in this

indictment.

Unless the jury finds beyond a reasonable doubt

that the Government has proved the existence of

a single scheme to defraud, as charged in the

indictment, the Defendant must be acquitted of

the pertinent counts. The single scheme charged .

includes the obtaining of FICA recovery contracts

from Allegheny County, the City of Pittsburgh and

also the Commonwealth of Pennsylvania.

If you find that Mr. Torquato and others were

involved in separate conspiracies concerning or

regarding Allegheny County or City of Pittsburgh,

or Pennsylvania School District FICA recovery

33a

Appendix B

contracts, and that the Defendant was not a

participant in one or more of these separate

conspiracies, then your verdict as to the Defendant

on the entire indictment must be not guilty.

By separate conspiracy, I mean a conspiracy that

has no connection with another conspiracy except

for the fact that John Torquato, Jr., or one or

more other individuals, played a role in both

You may, “however, find that the Defendant

participated in the conspiracy charged in the

indictment even if that conspiracy encompassed

three related subconspiracies involving different

groups of individuals.

Transcript Volume 40 pp. 153-154.

At the conclusion of the charge, counsel for Smith took

exception to the portion of the charge that defined separate

conspiracies. Transcript Volume 40, p. 188. Smith’s counsel

propounded an instruction which he desired directed towards

defining separate conspiracies ‘wut which in our view was defective.

Because it was late in the day and it was inappropriate for the

jury to start its deliberations at that time, we directed counsel

to confer and attempt to agree upon adequate definitions of single

and separate conspiracies for a supplemental instruction the

following morning. Transcript Volume 40, p. 188-193.

On June 14, 1985, we conferred with all counsel and in the

absence of an agreed instruction, we then gave the following new

instruction to the jury on the issue of multiple conspiracies:

34a

Appendix B

**THE COURT: At the end of the Court’s

instructions there are always requested changes,

and we find that some of the requests that have

been made do have merit.

We will give you some further instructions.

Yesterday, I talked very briefly about separate

conspiracies. I’m going to ask you to disregard

what was said then because we have an elaboration

and a correction of it.

A single conspiracy is one in which the

Defendants and those with whom they are charged

with conspiring share a common goal of the

conspiracy set forth in the indictment. Separate

conspiracies, although they may have common

elements, common participants, common means,

some common objectives, or other common

factors, but which lack the critical element of

common objectives of the conspiracy on the part

of all of the participants, do not qualify as a single

conspiracy.

The gist of a criminal conspiracy may involve

numerous transactions and the fact that

conspirators individually or in groups perform

different tasks in pursuing a common goal does

not necessitate a finding of several conspiracies.

35a

Appendix B

Even if a small group is at the heart of an

unlawful agreement, others who knowingly

participate with core members to achieve a

common goal may be members of a single

conspiracy.

Accordingly, you may find that a master

conspiracy for the obtaining of FICA recovery

contracts by a bribery and fraud existed and that

more than one subsidiary scheme was involved.

You should review the indictment and determine

if the master conspiracy charged therein has been

proven.

Transcript Vol. 41, pp. 34-36. Parenthetically, the transcript shows

the use of the article ‘‘a’’ before ‘‘bribery and fraud’’. The Court

is of the view that the article was never stated and that the

transcript is in error.

Smith contends that the giving of the new instruction on June

14, 1985 violated Rule 30 of the Federal Rules of Civil Procedure

and that he was prejudiced by the new instruction. Rule 30 of

the Federal Rules of Civil Procedure states that ‘“The Court shall

inform counsel of its proposed action upon the requests prior

to their arguments to the jury.’’ Rule 30 requires the Court to

inform counsel of its proposed action upon counsel’s requested

points for charge; it does not require the court to give counsel

further information about the contents of the charge. Our

instruction to the jury regarding conspiracy on June 14, 1985 was

not a departure from the requirements of Rule 30. Even if giving

the new instruction had violated Rule 30, failure to comply with

the requirements of Rule 30 does not ipso facto mandate reversal,

Hamling vs. United States, 418 U.S. 87, 135, 94 S.Ct. 2887 (1974).

36a

Appendix B

The question is whether or not the charge in its entirety was

fundamentally prejudicial to Smith. United States vs. Hartman,

409 F.2d 198 (3d Cir. 1969), United States vs. Wander, 601 F.2d

1251 (3d Cir. 1979).

Smith contends that he was prejudiced by the Court’s giving

of the new instruction on June 14, 1985 because Smith’s counsel

did not have the opportunity to know before his closing argument

that an instruction would be given regarding single and multiple

conspiracies. This is not a correct statement of what took place

at trial. The concepts of single and multiple conspiracies had been

raised by counsel for Smith himself in his proposed point #30

and supplemental point #9. The new instructions related to an

issue counsel had been advised would be covered in the charge.

Smith also contends that he was prejudiced because the new

instruction altered the Government’s theory of the conspiracy such

that the indictment failed to inform Smith of the nature of the

charges against him. The new charge was not a change in the

Government’s theory that there was one conspiracy and that Smith

was a participant in this conspiracy, but was an elaboration on

the concept of single and multiple conspiracies.

There are additional reasons why the new instruction did not

prejudice Defendant Smith. First, the charge as a whole after the

new instruction was given covered the area of conspiracy

completely and was an accurate statement of the law. This Count’s

primary reason for giving the new instruction was to prevent jury

confusion.

Second, it was defense counsel who took exception to the

portion of the charge that addressed separate conspiracies and

requested an additional instruction defining them. The Court

37a

Appendix B

concluded that there might be confusion on the part of the jury

regarding separate conspiracies primarily as a result of Smith’s

counsel’s exception. In an effort to avoid confusion on the part

of the jury, the Court gave the new instruction on the issue of

multiple conspiracies. Since Smith was not prejudiced in any way

by our giving the new instruction, his request for a judgment of

acquittal or for a new trial on this basis will be denied. In short,

this issue about a defective charge on single and multiple

conspiracies is, in my opinion, a cured Clupea harengus.

IV. The Court’s Charge Regarding Termination of the

Conspiracy.

Smith argues that our refusal tc give an instruction that the

mail fraud objective of the alleged conspiracy ended June 22,

1984 and that the travel act objective of the conspiracy terminated

with the last act of travel, June 7, 1984 entitles Smith to a new

trial. Smith contends that ‘‘. . . it was error to allow the jury

to find that the defendants participated in conspiratorial conduct

after the principal object of conspiracy had terminated by the

final mailing or act in furtherance of interstate travel.’’ Smith’s

post-trial brief at unnumbered page 20. Smith relies on the case

of United States vs. Oxman, 740 F.2d 1298, 1304 (3d Cir. 1984)

to support his argument. In Oxman the Court held that a

conspiracy to violate a substantive prohibition in a federal statute

ends when the unlawful object has been accomplished. The

conspiracy charged in the Oxman indictment ended in June of

1979. The Defendant in that case requested an instruction charging

that the jury must have found that the Defendant’s membership

in the conspiracy terminated before June of 1979. The Court in

Oxman refused the requested instruction and gave a charge stating

that the overt act must have occurred between November, 1976

and January 1981. In Oxman, the charge thus permitted the jury

38a

Appendix B

to find an overt act beyond the termination date of the conspiracy

set forth in the indictment.

The facts of United States vs. Oxman are significantly

different from the facts in this case. The indictment in United

States vs. Smith alleges that the conspiracy began on or about

January 1, 1983 and continued up to the date of the indictment

which was October 22, 1984. The indictment in United States vs.

Smith alleges continuing offenses which contemplate continual

uses of the mails and facilities of interstate commerce up to the

date of the indictment, whereas the Oxman case dealt with a

conspiracy which had ended on a fixed date.

The charge proposed by Smith (Smith’s supplemental point

No. 2) was not given because it was not applicable to the facts

of this case. A Court may properly refuse to submit to the jury

a requested instruction which incorrectly states the law applicable

to the case or would mislead the jury, United States vs. Alvarez,

519 F.2d 1036 (3d Cir. 1975), or which presents a theory not

supported by the trial record, United States vs. Bertucci, 333 F.2d

292 (3d Cir. 1964). The indictment did not charge that the mail

fraud objective of the alleged conspiracy ended on June 22, 1984

or that the travel act objective of the conspiracy ended on June

7, 1984; thus, Smith was not prejudiced by this Court’s refusal

to give his proposed supplemental instruction No. 2. This Court

properly instructed the jury that

A conspiracy ends when its principal objective is

accomplished, when it is abandoned, or when

otherwise terminated by some affirmative act. Any

agreement to conceal a completed crime made after

a crime is committed does not—let me emphasize—

does not extend the life of a conspiracy.

39a

Appendix B

Therefore, I charge you that in the absence of an

express initial agreement to conceal between the

conspirators, you may not find a Defendant guilty

of a conspiracy from the mere fact that he agreed

to conceal a completed crime or engaged in acts

of concealment following the completion of the

crime.

Now, that’s a bit difficult and it’s vital and I’m

going to read it to you again. (The Court then

repeats the instruction.)

Transcript, Volume 40, p. 152. Smith’s argument for a judgment

of acquittal or for a new trial on the basis that we improperly

instructed the jury regarding termination of a conspiracy is without

merit.

V. Sufficiency of the Evidence on the Substantive Counts.

The substantive counts of which Smith was found guilty are

three mail fraud counts (Counts 2, 3, 7) and five counts of

committing interstate transportation in aid of racketeering (Counts

9, 12, 13, 14, 15). Smith argues that there is insufficient evidence

to support the guilty verdicts on these counts.

a. The Mail Fraud Counts.

Count 2 of the indictment charges that Smith and other

Defendants caused a letter to be sent from John Torquato to

Defendant Smith in which Torquato describes a job on the

Pennsylvania Municipal Retirement Board which David Herbert

wished Smith and Torquato to obtain for him. Herbert was the

State Director of Social Security for Public Employees and was

40a

Appendix B

the highest state official in Pennsylvania empowered to authorize

FICA refunds. The testimony of Torquato, Herbert and Kincaid

indicated that Herbert was assisting CTA in obtaining FICA

recovery contracts because Smith and Torquato had promised to

obtain a better state job for him. The letter which is the subject

of Count 2 of the indictment was clearly in furtherance of the

conspiracy to influence public officials.

Count 3 of the indictment charges that Smith and other

Defendants caused Janice Kincaid to send a letter to Smith

containing a check for $1,000 on March 7, 1984 payable to the

Republican State Committee of Pennsylvania. The evidence shows

that the check was sent at the request of Smith to influence the

awarding of the FICA recovery contract.to CTA relating to the

Pennsylvania school districts. Torquato testified that he had

directed Kincaid to make the contribution from her own personal

account at Smith’s suggestion. Torquato later reimbursed Kincaid

under the guise of a bonus. The jury could reasonably have found

and we are persuaded that the mailing of this check was in

furtherance of the conspiracy to influence public officials of which

Smith was a participant.

Count 7 of the indictment charges that on June 22, 1984,

Smith and other Defendants caused a letter to be sent from

Torquato to Joseph Oravitz, Executive Director of the

Pennsylvania School Board’s Association, enclosing a draft of

an opinion from the Chief Counsel to the Treasurer of the

Commonwealth. The opinion indicated that CTA had an exclusive

contract to recover overpaid FICA funds on behalf of all

Commonwealth school entities. The evidence showed that Oravitz

was the individual who would have notified the School Boards

of the Commonwealth of the fact that CTA had been declared

the exclusive FICA recovery agent for all Commonwealth School

4la

Appendix B

entities. The fact that this mailing occurred after the contract had

been obtained from the Treasurer does not take the mailing beyond

the scope of the scheme charged in the indictment as Smith argues.

The scheme charged in the indictment had not terminated at the

time the letter was sent. Further, the money to pay the bribes

promised to the Treasurer of the Commonwealth had not been

collected and was at least in part dependent on future FICA

recoveries.

b. The Travel Act Counts.

Smith argues that Count 9 of the indictment which charges

the use of facilities of interstate commerce by Torquato to send

a letter to Defendant Smith on December 16, 1983, is not proved

because the record does not show any ‘‘overt act thereafter’’ in

furtherance of the travel. 18 U.S.C. § 1952 states that

(a) Whoever travels in interstate or foreign

commerce or uses any facility in interstate or

foreign commerce, including the mail, with intent

to—. ..

(3) otherwise promote, manage, establish, carry

on, or facilitate the promotion, management,

establishment, or carrying on, of any unlawful

activity, ‘

and thereafter performs or attempts to perform

any of the acts specified in sub-paragraphs (1), (2),

and (3), shall be fined not more than $16,000 or

imprisoned for not more than five years, or both.

Most of the overt acts listed in the indictment relating to the

42a

Appendix B

state contract for FICA recovery on behalf of the school entities

occurred after the mailing of the letter on December 16, 1983.

Torquaio enclosed with the letter a $10,000 check for Smith’s

work on the Allegheny County contract and in the letter gave

Smith advice concerning the best way to influence David Herbert.

There was more than sufficient evidence for the guilty verdict

on Count 9.

Smith argues that the discrete instances of interstate travel

by Torquato in violation of 18 U.S.C. § 1952 were not proven

because no subsequent overt act was shown to have occurred in

relationship to the travel involved in Counts 9, 12, 13, 14, and

15. Smith again raises the argument that this case involved several

separate conspiracies and that Smith did not participate in the

conspiracy involving Allegheny County. As we held earlier in this

opinion, the evidence showed beyond a reasonable doubt the

existence of one conspiracy corruptly to influence public officials

to award FICA recovery contracts to CTA. Smith was involved

in the entire conspiracy not only through his own acts but also

through his knowledge of the activities of other participants and

acts done knowingly in furtherance of the unlawful goal. It is

not necessary that Smith have known all of his co-conspirators

or that he have taken part in each and every activity of the

conspiracy in order for him to have been convicted of invoivement

in the conspiracy. United States vs. Grassi, 616 F.2d 1295, 1303

(Sth Cir. 1980), cert. denied, 449 U.S. 956 (1981). The essence

of the crime of conspiracy is the agreement to commit an unlawful

act or acts, United States vs. Hutto, 256 U.S. 524, 528 (1921),

United States vs. Klein, 515 F.2d 751, 753 (3c “ wr. 1975). The

Government has met its burden of proving that Smith entered

into an agreement with the specific intent to advance the unlawful

goal of attaining for CTA FICA recovery contracts through bribery

and fraud.

43a

Appendix B

VI. The Jnadi issue; Testimony of John R. Torquato, Jr.

Regarding Conversations with Egidio Cerulli.

During the trial Smith objected to the introduction of

testimony of John Torquato concerning Torquato’s conversations

with Egidio Cerulli on the grounds that the testimony violated

the Confrontation Clause of the Sixth Amendment. United States

vs. Inadi, 748 F.2d 812 (3d Cir. 1984), cert. granted, ____._ U.S.

__. (May 28, 1985). The Government believed that Torquato

was permitted to testify as to what he heard Cerulli say and this

Court permitted the testimony. Smith now argues that the

admission of this testimony into evidence was prejudicial and

requires the granting of a new trial.

This Court may grant a new trial to Smith “‘if required in

the interest of justice.’’ Rule 33 Fed.R.Crim.P. A motion for

new trial should only be granted where the error at trial is

prejudicial. United States vs. Smith, 520 F.2d 1245 (8th Cir. 1975).

“*Any error, defect, irregularity, or variance which does not affect

substantial rights shall be disregarded.’’ Rule 52 Fed.R.Crim.P.

During the trial Torquato testified that he had contacted and

then met with Mr. Cerulli, an official in the Democratic Party,

to discuss the contract for FICA recovery in Westmoreland

County. Torquato testified that Cerulli said ‘‘. . . he (Cerulli)

would appreciate it if we would contribute to the Democrats’’.

Transcript, Volume 4, pp. 73-74.

Smith contends that this testimony of Torquato violates the

requirements of the Confrontation Clause as expressed in United

States vs. Inadi, 748 F.2d 821 (3d Cir. 1985), cert. granted, ____

U.S. (May 28, 1985). In J/nadi, the Court held that the

Government must show, as foundation for admitting out-of-court

dda

Appendix B

statements of a non-testifying co-conspirator under

Fed.R.Ev.801(d)(2)(E), that the co-conspirator is unavailable to

testify in order for the testimony to comply with the Sixth

Amendment’s Confrontation Clause. The Confrontration Clause

grants the accused the right to be confronted with the witnesses

against him. Pointer vs. Texas, 380 U.S. 400, 85 S.Ct. 1065 (1965).

The holding in /nadi is based in part upon Ohio vs. Roberts, 448

U.S. 56, 63-65, 100 S.Ct. 2531, 2537-2539 (1980) in which the

Supreme Court held that ‘‘In the usual case . . . the prosecution

must either produce, on demonstrate the unavailability of, the

declarant whose statement it wishes to use against the defendant.’’

448 U.S. at 65, 100 S.Ct. at 2538.

The Government argues that Torquato’s testimony regarding

his conversations with Cerulli was not hearsay because it was not

offered to prove the truth of any matters asserted by Cerulli, but

only to show the fact that the conversation and solicitation

occurred between Cerulli and Torquato. United States vs. Bohr,

$81 F.2d 1294 (8th Cir. 1981). Rule 801(d)(2)(E) of the Federal

Rules of Evidence provides that “‘A statement is not hearsay if—

... The statement is offered against a party and is... (E) a

statement by a coconspirator of a party during the course and

in furtherance of the conspiracy.’’ The fact that an out-of-court

Statement is not being offered to prove the truth of the matter

asserted by the statement brings the statement outside of the

definition of hearsay and also beyond the scope of the

Confrontation Clause, i.e. if the statement of the out-of-court

declarant was not being offered to prove the truth of the matter

asserted by this statement, the admission of the statement into

evidence would not violate the Confrontation Clause. Since

Cerulli’s comments were not offered for the truth of their contents,

Cerulli’s statement: were not in violation of the Confrontation

Clause as interpreted in Ohio vs. Roberts, 448 U.S. 56, 100 S.Ct.

45a

Appendix B

2531 (1980), and United States vs. Inadi, 748 F.2d 812 (3d Cir.

1984).

Further, even if we were to find that the introduction of

Torquato’s testimony regarding Cerulli’s statements was in

violation of the Confrontation Clause, Smith would not be entitled

to a new trial because he was not prejudiced in any way by the

admission of this evidence. Smith had the opportunity to cross-

examine Torquato concerning the statements of Cerulli. Further,

the Defendants opposed the giving of a cautionary instruction

that the evidence was being admitted solely for the purpose of

showing the solicitation of political contributions by Cerulli and

not for the truth of showing the involvement of other individuals

named by Cerulli. Transcript, Volume 4, pp. 65-71. Most

significantly, Torquato’s testimony concerning Cerulli’s statements

was a relatively short and unimportant aspect of the Government’s

case; Cerulli said nothing about Smith’s involvement in the scheme

to bribe public officials; in fact, Smith’s name was not mentioned

by Cerulli at all. Transcript, Volume 4, pp. 72-74.

VIL. Alcohol Treatment Records.

Smith contends that this Court’s denial of his motions to

order disclosure of records of John Torquato and Judy Ellis

maintained by alcoholism treatment programs deprives him of

his Sixth Amendment right of cross-examination. 42 U.S.C.

§ 290dd-3 protects the § 290dd-3 records of a patient involved

in an alcoholism treatment program conducted, regulated, or

assisted by a department or agency of the United States. Such

records may only be disclosed under certain circumstances,

including ‘‘if authorized by an appropriate order of a court of

competent jurisdiction granted after application showing good

cause therefor.’’ 42 U.S.C. § 290dd-3(b)(2\(C). According to this

46a

Appendix B

statute and the regulations published at 42 C.F.R. § 2.61, the

records can only be disclosed by a court order based upon a

showing of good cause and a finding that the public interest and

the need for disclosure outweigh the injury to the patient, to the

physician-patient relationship, and to the treatment services. 42

U.S.C. § 290dd-3(bK2MKC), 42 C.F.R. § 2.64(d). If other

competent evidence or sources of information are available, the

Court should ordinarily deny the application. 42 C.F.R. § 2.64(e).

During and after a hearing held on April 19, 1985, we weighed

the factors indicated in the statute and regulations and determined

that the Defendants had not shown good cause for disclosure of

the records, and that the public interest and need for disclosure

did not outweigh the injury to the patients, to the physician-patient

relationship, and to the treatment services. See this Court’s written

Orders of April 24, 1985, Docket #144, and of May 14, 1985,

Docket #159. Smith’s opportunity to cross-examine Torquato and

Ellis was not impaired by non-disclosure of the records. There

was full evidence that Torquato was an alcoholic and he was

subjected to extensive cross-examination regarding his use of

alcohol. It is highly unlikely that anything in the records from

the alcoholism treatment program could have provided any

additional basis for attacking his credibility. See Bell vs. State,

385 So.2d 78 (Ala. Cr. App. 1980); United States vs. Graham,

548 F.2d 1302 (8th Cir. 1977). The same is true as to Ellis. Smith

was not prejudiced by the denial of his motions for records and

is not entitled to a new trial on this basis.

VIII. The Eleven-Person Jury.

Smith argues that he is entitled to a judgment of acquittal

or new trial because his constitutional rights were violated when

this Court permitted the return of a verdict by eleven jurors. The

47a

Appendix B

trial in this case lasted for approximately three months. After

the charge the remaining alternate was discharged. On the morning

of the fourth day of jury deliberation, one of the jurors was

involved in a serious automobile accident while en route to the

courthouse and was hospitalized. The Court and counsel consulted

with her physician by telephone and learned that it would be

months before she could deliberate with her fellow jurors. Defense

counsel refused to stipulate to a verdict of eleven jurors. After

hearing argument by all counsel regarding the Court’s options,

we invoked Rule 23(b) of the Federal Rules of Criminal Procedure

and permitted the verdict to be returned by the remaining 11 jurors.

Rule 23(b) provides that

. . . if the court finds it necessary to excuse a juror

for just cause after the jury has retired to consider

its verdict, in the discretion of the court a valid

verdict may be returned by the remaining |! jurors.

Rule 23(b) Fed.R.Crim.P. The Notes of Advisory Committee on

Rules explain that the relevant amendment to Rule 23(b)

addresses a situation which does not occur with

great frequency but which, when it does occur,

may present a most difficult issue concerning the

fair and efficient administration of justice. This

situation is that in which, after the jury has retired

to consider its verdict and any alternate jurors have

been discharged, one of the jurors is seriously

incapacitated or otherwise found to be unable to

continue service on the jury. The probiem is acute

when the trial has been a lengthy one and

consequently the remedy of mistrial would

48a

Appendix B

necessitate a second expenditure of substantial

prosecution, defense and court resources.

Notes of Advisory Committee on Rules. The event which arose

in this case is precisely the type of situation for which Rule 23(b)

was designed. We applied the Rule because of the enormous

investment of time and energy in this case by the parties, the court,

the jurors, and the public.

The Advisory Committee cites the case of Williams vs.

Florida, 399 U.S. 78, 90 S.Ct. 1893 (1970) as authority for the

pertinent amendment to Rule 23(b). The Court in Williams vs.

Florida held that the Sixth Amendment right to a jury trial does

not include a requirement that the jury consist of 12 persons.

In Williams, the Court upheld Florida’s refusal to impanel a jury

of more than six persons as provided by Florida law and held

that a jury of six did not violate the Defendant’s Sixth Amendment

rights as applied to the States through the Fourteenth Amendment.

Having upheld a six-person jury, the Supreme Court would

probably uphold the occasional use of an eleven-person jury

pursuant to Rule 23(b) Fed.R.Crim.P. The Court in Williams

opened the door to the amendment of Rule 23(b) Fed.R.Crim.P.

in stating that

We do not mean to intimate that legislatures can

never have good reasons for concluding that the

2-man jury is preferable to the smaller jury, or

that such conclusions—reflected in the provisions

of most States and in our federal system—are in

any sense unwise. Legislatures may well have their

own views about the relative value of the larger

and smaller juries, and may conclude that, wholly

apart from the jury’s primary function, it is

49a

Appendix B

desirable to spread the collective responsibility for

the determination of guilt among the larger

group . . . Our holding does no more than leave

these considerations to Congress and the States,

unrestrained by an interpretation of the Sixth

Amendment that would forever dictate the precise

number that would constitute a jury.

Williams vs. Florida, 399 U.S. 78 at 103.

Smith fails to cite persuasive authority for his contention that

Rule 23(b) is unconstitutional. None of the Court of Appeals’

opinions in this circuit cited by Smith addresses the issue at bar.

In our view, Rule 23(b) Fed.R.Crim.P. is constitutional. Our

reliance upon Rule 23(b) Fed.R.Crim.P. did not violate Smith’s

rights under the Sixth Amendment or under Article III, Section

2 of the United States Constitution.

IX. The Evidence of the Laventhol-Horvath Contract.

Smith argues that the admission of the evidence of the

Laventhol-Horvath Contract was irrelevant and prejudicial;

however, Smith does not address this argument in any post-trial

brief. Laventhol-Horvath is a nationally known accounting firm.

The evidence showed that it was willing to enter into a contract

to perform the identical FICA recovery services for the

Pennsylvania school entities at a substantially lower price than

CTA under the contract actually awarded to CTA. This evidence

bears on whether or not bribery was involved in the awarding

of the contract to CTA; therefore, the evidence of the contract

was relevant and properly admitted.

50a

Appendix B

X. The Testimony of Carol Teufel and the Admissibility of

Rebuttal Testimony.

Included in his list of reasons for acquittal and in the

alternative for a new trial, Smith lists several items which he does

not address in any brief. He contends that the testimony of Carol

Teufel was irrelevant and prejudicial and that this Court erred

in admitting as rebuttal the testimony of James P. Connor, Ralph

Tobelman, David Cole, Carol Curry, Gary Seifert, Edward Allen,

Kathleen Destralo, and Leo Morris. Since these contentions are

not addressed in a brief we assume that Smith is no longer relying

upon them as a basis for his post-trial motions. Additionally,

we are of the view that such contentions are without merit.

The grounds listed by Smith in his post-trial motions viewed

individually and in total do not form the basis for the entry of

a judgment of acquittal or for awarding Smith a new trial. An

appropriate order will be entered.

s/ Muir

MUIR, U.S. District Judge

DATED: October 17, 1985

Sla

Appendix B

UNITED STATES DISTRICT COURT FOR THE MIDDLE

DISTRICT OF PENNSYLVANIA

Criminal No. 84-00156-04

(Judge Muir)

UNITED STATES OF AMERICA

vs.

WILLIAM T. SMITH

ORDER

1. William T. Smith’s motion for judgment of acquittal is

denied.

2. William T. Smith’s motion for a new trial is denied.

s/ Muir

MUIR, U.S. District Judge

DATED: October 17, 1985

MM:i:sr

52a

APPENDIX C—ORDER OF THE UNITED STATES COURT

OF APPEALS FOR THE THIRD CIRCUIT AFFIRMING

JUDGMENT FILED APRIL 28, 1986

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

Nos. 85-5532, 85-5702, 85-5714

UNITED STATES OF AMERICA

v.

SMITH, WILLIAM T., JR.

WILLIAM T. SMITH, Appellant in 85-5532 and 85-5714

UNITED STATES OF AMERICA

v.

STONEMAN, ALAN R.

Alan R. Stoneman, Appellant in %5-5702

On Appeal from the United States District Court for the Middle

District of Pennsylvania - Scranton

(D.C. Criminal Nos. 84-00156-04, 84-00156-05)

Present: HUNTER and MANSMANN, Circuit Judges, and

POLLAK, District Judge*

* Hon. Louis H. Pollak, United States District Judge for the Eastern District

of Pennsylvania, sitting by designation.

53a

Appendix C

JUDGMENT

This cause came on to be heard on the record from the United

States District Court for the Middle District of Pennsylvania and

was argued by counsel March 18, 1986.

On consideration whereof, -it is now here ordered and

adjudged by this Court that the judgments of the said District

Court, entered July 23, 1985, and October 18, 1985 as appealed

by the defendant, William T. Smith, Jr., in appeal Nos. 85-5532

and 85-5714 and entered July 25, 1985 and October 18, 1985,

as appealed by the defendant, Alan R. Stoneman, in appeal No.

85-5702, be, and the same are hereby affirmed.

ATTEST:

s/ Sally Mrvos

Clerk

April 28, 1986

54a

APPENDIX D—ORDER OF THE UNITED STATES COURT

OF APPEALS FOR THE THIRD CIRCUIT DENYING

PETITION FOR REHEARING FILED MAY 23, 1986

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

Nos. 85-5532, 85-5714

UNITED STATES OF AMERICA

v.

SMITH, WILLIAM T., JR.

Appellant

SUR PETITION FOR REHEARING

Present: ALDISERT, Chief Judge, SEITZ, ADAMS, HUNTER,

WEIS, GARTH, HIGGINBOTHAM, SLOVITER, BECKER,

STAPLETON and MANSMANN,. Circuit Judges

The petition for rehearing filed by

APPELLANT

in the above entitled case having been submitted to the judges

who participated in the decision of this court and to all the other

available circuit judges of the circuit in regular active service, and

no judge who concurred in the decision having asked for rehearing,

and a majority of the circuit judges of the circuit in regular active

|

|

|

|

|

55a

Appendix D

service not having voted for rehearing by the court in banc, the

petition for rehearing is denied.

By the Court,

s/ James Hunter

Judge

Dated: May 23, 1986

56a

APPENDIX E—ORDER OF THE UNITED STATES COURT

OF APPEALS FOR THE THIRD CIRCUIT STAYING

MANDATE TO JULY 22, 1986 FILED JUNE 16, 1986

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

Nos. 85-5532 and 85-5714 Only

United States of America

VS.

William T. Smith, Jr., Appellant

Pursuant to Rule 41(b) of the Federai Rules of Appellate

Procedure, it is O R D E R E D that issuance of the certified

judgment in lieu of formal mandate in the above cause be, and

it is hereby stayed until July 22, 1986.

s/ James Hunter

Circuit Judge

Dated: June 16, 1986