Opposition Brief — Johnson v. United States

Supreme Court brief1948

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Donald Johnson’s interest in cases in which he was not

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771900—_48——_1 (1)

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Argument—Continued

(b) The correctness of Judge Johnson, etc.—Continued

(3) Judge Johnson’ 8 appointment of Townsend as

(5) Judge Johnson’s orders increasing the com-

pensations of counsel to the receivers and

(6) Judge Johnson’s conspiracy with Memolo,

Moore, and Donald Johnson to permit

Bethlehem Steel to fereclose its mortgage

for the corrupt consideration of $225,000 -

Continental Cigar Corporation case-_-_-.........--

(7) Judge Johnson’s appointment of Crolly as a

trustee and of Memolo as counsel to the

(9) ncn Johnson’s release of Korman from pro-

DS cn akclitéa.n capegnntnkedumaiinnahi

Dervas Tobacco Company case__-______.__ .-_..__.-

(10) Judge Johnson’s appointment of Schwartz as

(11) Judge Johnson’s allowance of Schwartz’ fee_

Wilkes-Barre & Eastern Railroad Company case. -- _-

(12) Judge Johnson’s appointment of Schwartz

as counsel to the trustee____.__.._..__--

Giant Dry Goods Company case------_.._.....__.-

(13) Judge Johnson’s appointment of Levy as

Central Forging Company case -_--_--_..........._.-

(14) Judge Johnson’s appointment of Michael as

successor trustee and of Reifsnyder as his

(15) Judge Johnson’s approval of the proposed

plan of reorganization. _--__- dabehihitante

* (16) Judge Johnson’s receipt of $500 of the cor-

rupt $2,500 paid to Donald Johnson_ . .__

Be tien tcinadne thecsnentnienetacenens

(17) Koppelman’s contente—= Wing ssceuhaagne

The “Additional Evidence” _____._.. 2s. = ais

(18) Judge Johnson’s receipt of money from, “un-

known”’ sources of income. ---_____..__.-

(19) Judge Johnson’s admissions in regard to his

money from “unknown” sources

Johnson’s membership in it... ........_____.__- he

$6 266 685 4% SS

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Ill

CITATIONS

Cases: Page

Bazter v. United States, 45 F. 2d 487_.......--... 42

Belvin v. United States, 12 F. 2d 548, certiorari denied, 273

ee Wen carennsaccéneehsatansentecimemmmedc. ak. 42

Blumenthal v. United States, Nos. 54-57, this Term, decided

December 22, 1947 53

WO SSSSSCSSSSS COSSESeeeesceceesoase

Canella v. United States, 157 F. 2d 470...........

Delaney v. United States, 263 U. 8. eh atbndanetiawencak 57

Edgington v. United States, 164 U.S. 361... 64

Haffa v. United States, 36 F. 2d 1, certiorari denied, 281

Wy Th Meenas ustictsheesaimsnubdiasatc <2. 64

Joyce v. United States, 153 F. 2d 364, certiorari denied, 328

U. B. O08................., KK tees RA Sle nom digiac abn: 42

Kaufmann v. United States, 282 Fed. 776, certiorari denied,

i We OD etiswcncccansarancesiniacceesesencne.. 65

Kotteakos v. United States, 328 U. 8. 750........_____ 40, 53, 55

Kreiner v. United States, 11 F. 2d 722, certiorari denied,

OPS D, © i nnccknesicntenccennseauhas uunececacn. 64

Lias v. United States, 51 F. 2d 215, affirmed, 284 U.S. 584__ 59

Medlock v. State, 108 Tex. Cr.274.....-- 67

Meyers v. United States, 36 F. 2d 859, certiorari denied, 281

Te Ws Wndhicsconksusbstssnucateckicccls «oc. 40.5 59

Schoborg v. United States, 264 Fed. 1, certiorari denied, 253

Wnts: Winanecadwiininnlcctnndacuebinds ck. ccs 67

Shaw v. State, 73 Tex. Cr. 887__................._... 67

United States v. Austin- Bagley Corporation, 31 F. 2d 229,

certiorari denied, 279 U.S. 863_.............. 41, 42

United States v. De Angelo, 138 F.2d 466_.__..... 62

United States v. Fox, 130 F. 2d 56, certiorari denied, 317

Wes SUUvatnevcieehsiveksnchavasinckencie ti. \! ae

United States v. Hare, 153 F. 2d 816, certiorari denied, 328

U.S. 836

Inthe Supreme Court of the United States

OcToBEr TERM, 1947

No. 459

DonaLpD M. JOHNSON, PETITIONER

Vv.

Unirep States or AMERICA

No. 460

JACOB GREENES, PETITIONER

Unirep States or AMERICA

ON PETITIONS FOR WRITS OF CERTIORARI TO THE UNITED

STATES CIRCUIT COURT OF APPEALS FOR THE THIRD

CIRCUIT

BRIEF FOR THE UNITED STATES IN OPPOSITION

OPINIONS BELOW

The opinion of the district court denying mo-

tions for judgments of acquittal notwithstanding

the verdicts (R. 925-937)’ is not reported. The

*“R.” is used herein to refer to the printed record filed pur-

suant to stipulation (R. 1239-1240). The designation “Tr.”

will be used to refer to the typewritten transcript filed with

this Court, reference to which may be made by any party

hereto under the terms of the stipulation.

(1)

opinion of the circuit court of appeals (R. 1223-

1234) is not yet reported.

JURISDICTION

The judgments of the circuit court of appeals

were entered August 21, 1947 (R. 1235-1236),

and petitions for rehearing were denied Sep-

tember 29 (Johnson) and October 3 (Greenes)

(R. 1236, 1237). On October 24, 1947, by order

of Mr. Justice Burton, Johnson’s time for filing

a petition for a writ of certiorari was extended

to November 28, 1947 (R. 1237), and on October

28, 1947, also by order of Mr. Justice Burton,

Greenes was granted a like extension to December

2, 1947 (R. 1238). Both petitions for writs of

certiorari were filed November 28, 1947. The

jurisdiction of this Court is invoked under Sec-

tion 240 (a) of the Judicial Code, as amended by

the Act, of February 13, 1925. See also Rules

37 (b) (2) and 45 (a), F. R. Crim. P.

QUESTIONS PRESENTED

1. Whether the evidence sufficiently established

a general, over-all conspiracy to obstruct justice

as charged, and not merely a number of separate,

disconnected conspiracies having no common

figure.

2. Whether the evidence is sufficient to sustain

the verdict as to petitioner Johnson.

3. Whether an overt act within the limitations

period was proved.

4. Whether the trial judge correctly applied

the doctrine of collateral estoppel in his instruc-

tions to the jury concerning the effect of peti-

tioner Johnson’s prior acquittal, of defrauding

and conspiracy to defraud the bankrupt estate of

the Central Forging Company, on their considera-

tion of the evidence adduced against him in the

instant case.

5. Whether a mistrial should have been de-

clared because the prosecutor, in his rebuttal

argument to the jury, called a defense witness a

“criminal conspirator.”’

6. Whether the instructions concerning the

weight that might be accorded to evidence of

good character were correct.

7. Whether the jury were sufficiently cautioned

that evidence of improper acts or of conspiracies

other than the one charged would not justify

verdicts» of guilty.

8. Whether the trial judge invaded the province

of the jury by telling them that some of the

overt acts alleged had been proved, the context

clearly indicating that by overt acts he meant

acts in the objective sense, disassociated from

their possible sinister character as having been

done in furtherance of the objects of the con-

spiracy.

9. Whether it was proper to permit the Gov-

ernment to introduce in evidence the admissions

against interest made by petitioner Greenes be-

fore the grand jury on two successive days,

without also requiring that all his other state-

ments before that. boty be introduced.

STATUTE INVOLVED

Section 135 of the Criminal Code (18 U.S. C.

241) provided in pertinent part during the period

of the alleged conspiracy (February 1934 to

December 1944) :*

Whoever corruptly * * * shall in-

fluence, obstruct, or impede, or endeavor to

influence, obstruct, or impede * * * the

due administration of justice [in any court

of the United States] shall be fined not

more than $1,000, or imprisoned not more

than one year, or both.

STATEMENT

On September 11, 1945 (R. 1), an indictment

(R. 1056-1086) was filed in the District Court

for the Middle District of Pennsylvania charging

that from February 1934 to December 1944 peti-

tioners and eight other defendants—Albert John-

son, Miller Johnson, Albert Johnson, Jr., John

Memolo, Hoyt Moore, Joseph Jennings, Charles

Korman, and David Schwartz—conspired with

one another and with other named persons, in

violation of Section 37 of the Criminal Code

(18 U. S. C. 88), to obstruct the administration

? The Act of June 8, 1945, c. 178, § 1, 59 Stat. 234, amended

this section by increasing the maximum fine to $5,000 and the

maximum term of imprisonment to five years (see 18 U.S.C.,

Supp. V, 241).

' NITE a ea

_—

of justice in divers judicial proceedings pending

in the District Court for the Middle District of

Pennsylvania, in violation of Section 135 of the

Criminal Code, supra, and to defraud the United

States of and concerning its governmental fune-

tion of having such proceedings considered and

disposed of by that court in accordance with law

and justice and, more particularly, of and con-

cerning its right to the honest and faithful judi-

cial services of the defendant Albert Johnson, as

senior judge of that court, in such proceedings

(R. 1057-1058). The indictment described, by

names, docket numbers, and brief descriptions

of their subject matters, eleven specific court pro-

ceedings allegedly affected by the conspiracy

charged (R. 1059-1067). Forty-six overt acts

were alleged (R. 1081-1086).

Following a trial by jury petitioners and the

defendants Miller Johnson and Memolo were

found guilty (R. 920, 1218; Tr. 3966) and each

was sentenced to imprisonment fo- two years

and to a fine of $10,000 (R. 941, 942, 1219; Tr.

3977).* On appeal, the convictions of petitioners

* The indictment also set out in detail the manner in which

the conspiracy was allegedly carried out (see R. 1067-1080).

* Judge Johnson and Albert Johnson, Jr., were acquitted

(Tr. 3968). The indictment was dismissed as to Moore and

Korman on their plea of the statute of limitations (Moore:

United States v. Johnson, 65 F. Supp. 42; Korman: United

States v. Johnson, 65 F. Supp. 46), and abated as to J ennings;

who died subsequent to its return (see R. 1224). Schwartz

was granted a severance because of illness (see 2bid.).

771900—48-—__2

and Memolo were affirmed (R. 1235-1236), that

of Miller Johnson being reversed on the ground

of insufficiency of the evidence to sustain it (R.

1228-1230).

In view of the nature of the case, the complexity

of the conspiracy involved and the numerous law-

suits around which it revolved, it is necessary to set

forth at greater length than seems desirable the

evidence supporting the convictions. The itali-

cized headings in the following summary denote the

names of the eleven court proceedings allegedly

affected by the conspiracy, the evidence grouped

under each such heading relating to that particular

proceeding. Other evidence, not relating to any

particular one of the eleven proceedings, is set forth

under the heading ‘‘ Additional Evidence.’’ Some

of the evidence consists of admissions against in-

terest made by petitioner Greenes before the grand

jury, which were admitted as against him alone

(R. 1104; see R. 885). Such evidence is set forth

below in brackets. Petitioner Donald Johnson

and Miller Johnson are the sons of former Judge

Johnson. Memolo, a local attorney, and petitioner

Greenes worked with them, according to the Gov-

ernment’s evidence, in selling Judge Johnson’s

judicial favors. The only other qualifying obser-

vations that need be made relate to the evidence

in the Central Forging Company case, infra, pp.

30-34, at which point in the Statement the neces-

sary explanatory facts are stated in marginal

notes.

MOUNT JESSUP COAL COMPANY CASE

This was a bankruptcy proceeding which arose

in 1925 (Ex. G-3, Tr. 348). In 1928 one Simon-

celli, tax collector of the Borough of Winton, by

his attorney, the defendant Memolo, filed a tax

claim of $12,747.14 against the bankrupt (Ex.

G-9, Tr. 357, 504-506). Claims for taxes were

also filed by the Commonwealth of Pennsylvania

and the United States (Exs. G6, G-7, Tr. 353,

355). Patrick Kilcullen, who had been named

special master by Judge Johnson to determine

the respective priorities of these claims (Ex. G-10,

Tr. 358, 507), first ruled that the Winton claim

had priority over the others (Ex. G-11, Tr. 349-

360, 507-513). At the instance of the United

States, Judge Johnson ordered Kilcullen to recon-

sider this finding (Ex. G-12, Tr. 361, 514) and

in February 1934 Kilcullen filed a second report,

in which, reversing his original finding, he ruled

that the claims of Pennsylvania and the United

States had priority (Ex. G-13, Tr. 362, 514-518).

On behalf of Simoncelli, Memolo excepted to this

second report (Ex. G-14, Tr. 363, 518-519) and

in July 1934 Judge Johnson reversed Kileullen’s

second decision and reinstated his original finding

in favor of the Borough of Winton (Ex. G-15,

Tr. 365, 519-526, 539-547). Accordingly Judge

Johnson ordered payment to Simoncelli of $20,-

496.10, the basic claim plus interest and penalties ;

he modified this order a few days later, directing

payment of the basic claim immediately but sus-

pending payment of the interest and penalties until

later (Ex. G-16, Tr. 366, 548-552).

Simoncelli testified that quite some time after

he filed his tax claim Memolo told him that he

would keep 50% of whatever money he recovered

for Simoneelli (R. 13-15). He eventually re-

ceived two checks from Memolo, the second being

accompanied by a statement explaining the dis-

tribution of the money recovered (R. 15-17).

This statement indicated that in November 1934

a check for $12,747.14 (the basic claim) was re-

ceived by Memolo, of which amount exactly half

was retained by Memolo as ‘‘Expenses paid,”’ the

other half being paid to Simoncelli; that in the

following month a second check, for $7,748.96 (in-

terest and penalties), was received by Memolo,

of which amount exactly half was retained by

Memolo as ‘‘Expenses paid’’; and that from the

other half, typing and notary expenses and Mem-

olo’s fee of $500 were deducted, the balance being

paid to Simoneelli (Ex. G-97, R. 19, 21-22).

[Petitioner Greenes admitted before the grand

jury that Kilcullen told him one day that he had

a case in which ‘“‘Mr. Memolo was interested”’

and which he thought ‘‘presented the possibilities

of some fees” and that Greenes should “see Mr.

Memolo about it’? (R. 1105-1106, 1116). Kil-

cullen also told Greenes that he ‘‘was going to try

to help Donald [Johnson] financially’ (R. 1114).

Greenes accordingly told Memolo to get in touch

with Kilcullen, who would ‘‘act on the case favor-

ably or have the case worked on favorably for

him”? (R. 1116). Memolo thereafter dealt with

Kilcullen directly (R. 1109, 1116). When Mem-

olo received the money recovered on behalf of

Simoncelli, he gave Greenes about $5,000 with

directions to give it to Kileullen (R. 1107, 1111).

Greenes took $1,000 to reimburse himself for a

loan he had made to Donald Johnson (R. 1109-

1110) and tendered the balance to Kileullen, but

the latter directed Greenes to give it to Donald

Johnson, who just then made an appearance (R,

1107, 1109, 1115). Greenes did so, stating that ‘‘it

was the proceeds of the Mt. Jessup coal thing’

(R. 1107, 1110).]

PENNSYLVANIA CENTRAL BREWING COMPANY CASE

This was a reorganization case which arose

in 1934 (Ex. G-18, Tr. 374). Memolo was a

trustee in the proceeding (R. 32-33).

Edward Maloney, an accountant, testified that

he agreed with Greenes in 1939 to “ go fifty-fifty’’

with him if Greenes would get him an appoint-

ment as auditor in this case. He thereafter re-

ceived such an appointment. (R. 50-52.) Ma-

loney worked for three months, and would not

‘“‘ordinarily’’ have charged in excess of $1,500

for his services (R. 60-61, 100-101). He charged

$4,973, receiving two checks for $2,500 and $2,473

on the orders of Judge Johnson (Exs. G-21, G-22,

Tr. 377-378). Memolo told him how much to

charge, and in fact prepared both his petitions

, 10

for fees (R. 52-54, 58). Maloney gave Greenes

50% of both payments pursuant to their agree-

ment (R. 54-55, 59).

[Greenes admitted asking Donald Johnson, at

Memolo’s request, to arrange for Memolo’s ap-

pointment as trustee. Memolo agreed to ‘“‘play

ball,”’ i. e., “divide his fees,” and Donald was

satisfied that he would since he ‘“‘did all right on

his commitment” in the Mount Jessup case. At

Donald’s suggestion, Memolo asked Judge John-

son for the appointment and received it. (R.

1117-1118.) Memolo’s first fee was $3,500. He

guve Greenes half to give to Donald Johnson,

which Greenes did, receiving $100 or $150 as his

share. (R. 1118-1119.) Memolo received his

second fee, $1,500, in 1943. Greenes went to get

the 50% called for by the agreement, but Memolo

refused to split this fee. The incident resulted in

a fight between them, Memolo bodily ejecting

Greenes from his office. (R. 1154-1157.) Greenes

also admitted making the arrangements with Don-

ald Johnson for Maloney’s appointment in this

ease and giving Donald half of Maloney’s fees,

less ‘‘a couple of hundred dollars”’ for. himself

(R. 1120-1122).]

WILLIAMSPORT WIRE ROPE COMPANY CASE

In 1932 the Williamsport Wire Rope Company

went into friendly receivership. Robert Gilmore

and Charles Ballard were the receivers, and

Oliver Decker their counsel. (Exs. G53, G-04,

G-55, G-56 [p. 1], Tr. 438-442.) The receivers’

fees were fixed at $1,000 a month each, and

Decker’s at $500 a month (Ex. G—56 [p. 2], Tr.

442).

In 1934 Judge Johnson appointed Delmar

Townsend, an old acquaintance of the J ohnsons,

coreceiver at the same compensation as the others

(R. 386-389; Ex. G-56, Tr. 442). Prior to the

receivership Gilmore had been president of the

Williamsport Company at a salary of $40,000 a

year plus expenses. Ballard had been vice-presi-

dent in charge of sales at $25,000 a year plus

expenses. Both these men continued to do the

same kind of work as receivers as they had pre-

viously done as officers of the company. (R. 401-

402, 433.) Prior to his appointment as receiver,

Townsend had been general manager of a 45-mile-

long railroad at a salary of $3,000 a year, which

he had been receiving since 1917 (R. 385, 416,

454-455). Townsend continued to hold his job

with, and draw his salary from, the railroad

throughout the more’ than three years of his

term as receiver (R. 398, 455). Following Town-

send’s appointment, Miller Johnson asked him

to give Albert Johnson, Jr. 50% of his fees in

order to help Albert, Jr. and Donald Johnson pay

‘“‘some obligations’ they had. Townsend agreed

to do so, and for the remaining three years of

his term as receiver gave Albert Jr. half of his

fees, less his tax thereon. (R. 391-398, 426.)

In 1935 Judge Johnson appointed Memolo co-

counsel to the receivers at $500 a month on

account, the same amount Decker, the original

counsel, was receiving. The order of appoint-

ment stated that it was issued ‘‘after consultation

with the Receivers and their Counsel and with

their approval.’’ (Ex. G60, Tr. 446, 1527-1528.)

Townsend testified that he had no knowledge that

Judge Johnson contemplated appointing another

attorney until he received the order (R. 390-391).

Townsend also testified that prior to Memolo’s

appointment the receivers would confer with

Decker whenever they needed legal advice, but

that such need did not arise especially frequently

(R. 391). Following Memolo’s appointment

Judge Johnson told the receivers and Decker that

the reason why he had appointed a second attor-

ney was that he had not been able to get desired

information from Decker, but Decker protested

that he recalled no such occasion. The receivers

“‘knew nothing about that,’’ according to Town-

send. (R. 442-443.)

In August 1935 Judge Johnson increased the

compensations of the attorneys to $1,000 a month

(Ex. G-61, Tr. 447). Townsend first learned of

the increases when the order was issued (R. 399-

400). Gilmore and Ballard were dissatisfied on

learning that their counsel were to receive the

same compensation as they (R. 429). Townsend,

therefore, told Judge Johnson that in his opinion

Gilmore and Ballard, who were devoting their

entire time to the receivership, should receive

more than the attorneys, but that he himself

wanted no increase, as he was entirely satisfied

with the amount he was getting. J udge Johnson

agreed with Townsend, except that he said he

would not increase the fees of ‘just two of the

receivers.”’ (R. 400-401.) Accordingly, in Sep-

tember 1935, the compensations of all three re-

ceivers were raised to $1,500 a month on account

(Ex. G-62, Tr. 448.) Townsend’s 50% contribu-

tions to Albert Johnson, Jr. thereafter reflected

his increase (R. 403).

From the beginning the receivership was ex-

tremely successful, and Judge Johnson on numer-

ous occasions so stated (Ex. G-56, Tr. 442; Ex.

G-62, Tr. 448; Ex. G-63, Tr. 449, 1552-1553; R.

405-406; Tr. 1609-1618). At a hearing on the

conduct of the receivership in January 1936 re-

ceiver Gilmore traced the steady and substantial

increases in gross sales, net profits, and cash ac-

cumulations. He stated that the demand for wire

rope was increasing and that the company had a

greater accumulation of unfilled orders than at

any time since 1930. He further stated that,

based on past experience and anticipated sales, the

entire indebtedness of the company, including all

unpaid interest on its outstanding bonds, and

excluding only the principal, could be “wiped

out”’ and the company restored to its stockholders

within two years. (Ts. 1609-1618.) On several

occasions, also, Judge Johnson stated that the

771900—48——_-3

Seen Y

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menace

<~_>

stockholders had a clear equity in the company

and that any plan of reorganization which did not

take this equity into account would be unaccept-

able (Ex. G-59 [p. 2], Tr. 445, 2241; Tr. 1663-

1665).

The principal creditor of the Williamsport

Company was the Bethlehem Steel Company,

which had become such by virtue of having bought

up most of its outstanding bonds at 70¢ on the

dollar and most of its unsecured obligations at

43¢ on the dollar (Tr. 1660-1661, 2332-2333,

2345). Bethlehem had made an “‘offer for the

whole plant’’ (Tr. 1660-1661), but Judge John-

son, at the January 1936 hearing said that, since

‘““this Bethlehem offer offers nothing to the pre-

ferred stockholders,’’ it should be rejected (Tr.

1663-1665).

Hoyt Moore, senior partner in a New York law

firm, was Bethlehem’s general counsel (R. 589-

590, Tr. 2518-2519), and Harry Mumford, a

Seranton attorney, was Bethlehem’s local counsel

in connection with the Williamsport receivership

(R. 467). In the summer of 1936 Memolo asked

Mumford if he knew what Bethlehem’s ‘‘objec-

tive’? was in respect of the Williamsport Com-

pany. At.this time, according to Mumford, the

affairs of the receivership were ‘‘very quiescent.”

When Mumford told Memolo he did not know,

Memolo asked him to arrange an appointment for

him with Robert MceMath, Bethlehem’s financial

vice-president, explaining that, “‘as attorney for

the receivers,’’ he might be able to work out some-

thing mutually advantageous. Mumford ar-

ranged the appointment. (R. 469-470, 581.)

Memolo, however, ‘‘got nowheres”’ with McMath,

who was “rather cagey’’ (R. 471), so he asked

Mumford to arrange an appointment for him with

Moore, who he thought would be ‘more frank”’

in disclosing ‘‘what Bethlehem wanted”? (R. 473-

474). Memolo remarked that the receivership

was a “‘large’’ one and “could stand quite a lot of.

money.’’ He also said that “the boys wanted to.

make a killing.’’ (R. 474.) He mentioned in

this connection the sum of ‘something like’?

$200,000 (R. 475).

In the fall of 1936, accordingly, Mumford ad-

vised Moore that Memolo would like to see him

and that he ‘‘was talkingin * * * large sums

of money.’? Mumford expressed ‘‘astonishment’”

to Moore ‘‘at the amount, and what was involved.’’

Moore told Mumford that he, Moore, was the

proper person to be astonished, that he “‘was in

the saddle,” and that he would like to see

Memolo. (R. 476, 961.) A meeting was accord-

ingly arranged and Mumford attended it himself

(R. 947). Thereafter Moore, Memolo, and Mum-

ford conferred and worked together “getting

papers ready’? many times at the Moore firm (R.

949). Mumford never saw any of the Williams-

port receivers there, however, nor Decker, the

other attorney for the receivers (Tr. 1811-1812).

On one occasion Memolo told Mumford that

“Don”? was with him in a ear, that ‘‘Don thought

he would get some money” on that occasion, but

that he ‘‘was going to be disappointed” (R. 478).

On September 14, 1936, Bethlehem instituted

foreclosure proceedings against Williamsport

(Ex. G-65, Tr. 452-453), and on May 27, 1937,

purchased the Williamsport Company at a fore-~

closure sale (Tr. 2329). During this 8%-month

interval extensive foreclosure litigation was con-

ducted “ and, according to the admissions of Moore,

a defense witness, numerous conferences were held

between him and Memolo, at which they discussed

many questions relating to what Bethlehem’s tactics

in the foreclosure proceeding should be (‘Tr. 2532-

2533, 2538, 2544-2548, 2554, 2559-2561, 2580-2586,

2588, 2590-2591, 2594-2595).

Also during this 8%-month interval Memolo

and Donald Johnson conferred with Judge John-

*« The receivers resisted Bethlehem’s petition to make them

parties defendant in the foreclosure proceedings (Ex. G-67,

Tr. 454) ; Judge Johnson granted leave to Bethlehem to join

the receivers as parties defendant (Ex. DJ-48, Tr. 2320, 2321-

2322) ; the bill of foreclosure was filed (Ex. G-69, Tr. 456) ;

the receivers filed an answer to the bill (Ex. G—70, Tr. 457) ;

separate answers were filed by certain stockholders (Exs.

DJ-53, DJ-54, Tr. 2441, 2443) ; Bethlehem filed motions to

strike portions ‘of the answers (Exs. DJ—55, DJ-56, Tr. 2444) ;

the motions to strike were granted by Judge Johnson (Ex.

G-73, Tr. 460) ; a foreclosure decree was entered (Ex. G-74,

Tr. 461-462) ; a stockholders’ petition to modify the fore-

closure decree was filed and dismissed (Ex. DJ-60, Tr. 2447;

Ex. G-76, Tr. 463) ; and exceptions to the decree were filed

by certain stockholders and dismissed (Ex. DJ—62, Tr. 2448;

Ex. G-76, Tr. 463).

son in the latter’s chambers on several occasions

(R. 156, 158, 159). On one of these occasions

Memolo ‘‘had the proposed foreclosure decree’?

with him, and Judge Johnson asked his law clerk,

Albert Houck, to ‘‘go over’ it with Memolo (R.

157). Houck testified that, while there was not

“anything unusual about an attorney preparing

a decree for a Court’s consideration”’ (R. 197),

it was “‘unusual’”’ for an attorney who repre-

sented the defendants in a proceeding to prepare

a decree on behalf of the plaintiff (R. 219). On

another of these occasions Albert J ohnson, Jr.

was also present, the conference being a ‘‘secret’’

one (R. 159, 212). Houck heard all the partic-

ipants at the conference whispering (R. 210-

211). From time to time Donald or Albert, Jr.

would open the door to Houck’s office to see

whether he was at his desk and whether he was

listening (R. 206-207, 208, 209-210, 260-261).

Several times Memolo and Donald asked Houck

questions about the Williamsport case (R. 159,

211). Donald and Albert, Jr. asked Houck

whether the duties of John Taylor, whom Judge

Johnson had named as special master to conduct

the foreclosure sale, included “distribution of

* * * the sale price.”’ Houck said yes and

referred them to the decree so providing. (R.

160-161, 212.) Neither Donald nor Albert, Jr.

was an attorney of record in the Willtamsport

case (R. 148, 218).

ae:

~~{ 18

On May 17, 1937, ten days before the sale,

Donald Johnson telephoned Houck and instructed

him not to file his father’s opinion in the Wtl-

liamsport case ‘‘until the boss said so’’ (R. 161).

At the foreclosure sale Bethlehem Steel pur-

chased the Williamsport Company as a going con-

cern for $3,300,000, the only bid made (Tr. 2329).

Included among the purchased assets was over

$1,000,000 in cash (Tr. 2347-2348). At the time

of the sale Bethlehem owned 95% of the out-

standing bonds of Williamsport, or approximately

$1,200,000 (Tr. 2332-2333), which it had previ-

ously bought up at 70¢ on the dollar (Tr. 2345).

The face value of these bonds, plus accrued inter-

est, was credited against the purchase price bid

(Tr. 2346).

On July 26, 1937, following the sale, Memolo

told Houck to tell Judge Johnson to file his final

decree confirming the sale immediately in order

to ‘‘forestall’’ certain Williamsport stockholders,

who were about to petition the circuit court of

appeals for a writ of prohibition restraining him

from so doing. Memolo ‘practically told [Houck]

what the Court should do,’’ which Houck thought

“twas carrying it a little too far,’ so he told

Memolc he should take the matter up with Judge

Johnson, not with him. (R. 162, 200.) The

following morning, July 27, Judge Johnson and

Donald both discussed the proposed final decree

with Houck. The Judge then called Memolo to

make sure the decree was “all right,” and it was

filed. No accompanying opinion was handed

down at this time, as it was not ready for filing.

The opinion was filed subsequently. J udge John-

son’s usual procedure was to file his decrees and

accompanying opinions simultaneously. This was

the first time since Houck had been associated

with him that this practice had been varied.

(R. 162-164.)

On August 2, 1937, Donald Johnson, Memolo,

and Judge Johnson had another ‘“‘very secret’’

conference (R. 164, 205, 209) and on August 13

Judge Johnson appointed John Crolly special

master and auditor in the case (Ex. G-84, Tr.

472; R. 165-166). Houck pointed out to Judge

Johnson that “John Taylor had already been

appointed Special Master and that this was ap-

parently a duplication or conflict with the other

order.”’ Judge Johnson replied that ‘‘it was all

right”’ because ‘‘Bethlehem has agreed to pay

those expenses and it won’t hurt Taylor’s fee.”

(R. 166, 213-214.)

On September 4, 1937, Judge Johnson ap-

pointed Martin Memolo, brother of the defendant

Memolo (Tr. 2601), ‘‘agent of this Court, to

supervise and oversee’’ the Williamsport prop-

erties pending appeal from the order confirming

the sale (Ex. G-85, Tr. 473).

On July 9, 1938, special master Crolly filed an

order appointing Edward Maloney to audit the

aceounts of the receivership. It was, however,

antedated August 20, 1937. (Ex. G-92, Tr. 479; R.

70, 71.) The ‘‘order of John W. Crolly * * *

of August 20, 1937’’ was ‘‘confirmed and ap-

proved”? by Judge Johnson on July 9, 1938 (Ex.

G-93, Tr. 480; R. 71).

By the terms of the ‘losure decree, the

purchaser was required to pay ‘‘all administra-

tion expenses’’ as well as all unpaid compensa-

tion of the receivers and their attorneys (Tr.

1766-1769). Whereas the receivers and Decker

received from Bethlehem final compensation in

the amount of $5,000 each (R. 950), Crolly’s final

fee was $30,850.01 (Ex. G-119, Tr. 1822), Martin

Memolo’s was $66,990 (Exs. G-124, G-125, G-126,

G-127, G-128, Tr. 1823-1824), Maloney’s was

$31,075 (Ex. G-118, Tr. 1822), and the defendant

Memolo’s was $81,084.99 (Exs. G-121, G-—122,

G-123, Tr. 1822-1823). Crolly’s and Maloney’s

bills for services were delivered to Moore by the

defendant Memolo (R. 1035). While the $5,000

checks of the receivers and Decker were delivered

to them by Mumford, Bethlehem’s local counsel

(R. 950), the checks of Crolly, Martin Memolo,

and Maloney were sent by Moore to the defendant

Memolo (Tr. 2742-2743). Moore admitted telling

Memolo that he did not care how much Crolly,

Martin Memolo, Maloney, and he billed Bethle-

hem for so long as the aggregate did not exceed

$250,000 (R. 1082-1033). Moore also instructed

Memolo as to what form the bills of Crolly,

Martin Memolo, and Maloney should be in (R.

1034-1035). At Moore’s request Memolo ap-

proved the bills of Crolly, Martin Memolo, and

Maloney by writing ““O. K. J. M.” on slips of

paper attached to the bills (R. 1036-1037 ¢ Tr

2628-2630; Exs. DJ-97, DJ-95, DJ-99, Tr. 2634—

2635), but Moore did not ask Memolo to “O. K.”

the final fees of the receivers and Decker (Tr.

2744).

Mumford testified that Moore consulted him

concerning the fees of the receivers and Decker,

but not concerning anybody else’s (R. 949-951).

Moore did tell Mumford once, however, that he

and Memolo were having difficulty concerning

‘‘the method of payment” of “the fees.” Memolo

“‘wanted his in cash,’? but was told that “it

couldn’t be done that way”’ because, since Beth-

lehem ‘‘was a corporation,’’ the fee ““would have

to be paid by check.” (R. 951.) Moore further

explained to Mumford that he ‘didn’t want to be

blackmailed by Mr. Memolo at a later date”’

(R. 957).

Maloney testified that in June 1938 Memolo

told him he would recommend him for the job of

auditing the receivership accounts, and that he

received the appointment a few days later, in July

(R. 63, 68-69). After he worked a few months

771900—48——-4

Memolo told him to bill Bethlehem for $31,075

and ‘‘to sort of distribute it from, say, dating

back to 1937.’”’ Maloney did so, ‘‘alleging serv-

ices rendered in 1937,’”’ though he had not been

appointed until July 1938. He gave the bill to

Memolo. (R. 64-66.) Thereafter Memolo called

Maloney to tell him his check had arrived. Malo-

ney endorsed it and gave it to Memolo. Memolo

asked him how much he would “ordinarily”’

charge for his work. Maloney said around $900

or $1,000. Memolo gave him $1,200, plus $3,900

to cover his income tax on the whole amount.

(R. 66-68, 74.)

[Greenes admitted recommending Memolo to

Donald Johnson as ‘‘additional counsel’’ to the

receivers after Memolo agreed to ‘“‘play ball’’ (R.

1124-1125). Memolo paid Greenes half of his

fees for delivery to Donald, sometimes borrowing

money in order to make ‘‘advances’’ and using

Donald’s 50% to pay off the loans (R. 1125-1129,

1154, 1169). Later ‘‘Memolo conceived the idea

of making a deal with Bethlehem to acquire the ~

entire works.’’ Memolo told Greenes only the

broad outlines of the plan, but discussed it in

detail with Donald. Greenes’ understanding was

that Bethlehem was ‘‘willing to spend’’ $150,000

as ‘“‘fees’’ for acquiring the Williamsport Com-

pany—$25,000 to be paid ‘‘on the record’’ to the

three receivers and their two counsel and the

balance to go to Memolo “‘off the record.”’ (R.

1130, 1137, 1140.) Greenes, Donald, and Memolo

drove to New York once to “sew this thing up.’’

After Memolo left Moore’s office, they went to see

Judge Johnson in a New York hotel, where

Memolo and Donald conferred with him privately.

(R. 1139-1140.) According to the plan as Greenes

understood it, the fees of Crolly, Martin Memolo,

and Mafoney were “‘to be turned back to”’ the de-

fendant Memolo (R. 1140-1141, 1149). Martin

Memolo received an advance fee of $25,000, fol-

lowing which Greenes went to the defendant

Memolo to collect part of it, but was told to “wait

until it is all in the pot.’ Greenes complained

to Martin that ‘John wasn’t doing as he agreed

to do,’’ but Martin told him that he himself had

given $6,000 of the money to Donald, which

Donald confirmed (R. 1141-1143). After the

‘‘off-the-record’’ money had been all paid, Memolo

“kept stalling,’ pretending he had not received

it (R. 1141, 1147-1150). A year after the case

was over, Judge Johnson told Greenes that

Memolo ‘“‘had treated Donald very shabbily’’ and

was a ‘‘crook’’ (R. 1145-1146). Greenes kept

dunning Memolo for a long time for his share of

the money, but in 1943 despaired of ever receiving

it (R. 1150-1152).]

CONTINENTAL CIGAR CORPORATION CASE

This was a reorganization proceeding which

arose in 1935. Judge Johnson appointed John

Crolly a trustee. (Ex. G-24, Tr. 385-386.)

Thereafter he appointed Memolo counsel to the

trustees (Ex. G-26, Tr. 387, 764-765).

[Greenes admitted that Memolo gave him half

of his $1,000 fee in this case, and that he delivered

it to Donald Jolmson, receiving about $50 for

himself (R. 1172-1173).]

KORMAN CASE

In May 1935 one Korman and 62 others were

indicted for conspiracy to violate the internal

revenue laws (Tr. 1097-1099, 1104). When the

case was tried in November 1935 before District

Judge Welsh, Korman had not yet been appre-

hended (Tr. 1098). Most of Korman’s codefend-

ants pleaded guilty (Tr. 1099), and all except a

very few received executed jail sentences (Tr.

1105, 1110). Korman subsequently pleaded guilty

before Judge Johnson in May 1936 (Tr. 1100,

1106). Judge Johnson asked Memolo, Korman’s

attorney, how large a fine Korman could pay, and

Memolo said $500 (Tr. 1100-1101). The attorney

for the Government objected to the imposition

of a fine only and advised Judge Johnson that

witnesses were present in court who could prove

that Korman furnished the syndicate more dis-

tilled spirits than any of the other persons in-

dicted as suppliers. He further told Judge John-

son that Judge Welsh had imposed substantial

jail sentences and fines on three persons who

were “‘in the same category as Korman,’’ and

urged that Korman should be given a jail sen-

tence not less severe. Judge Johnson sentenced

Korman to a fine of $500 and imprisonment for

a year and a day, but suspended execution of the

prison sentence and placed Korman on probation

for five years. (Tr. 1101-1102.)

Phillip Katz, a second cousin of Greenes (R.

123), who had been told many times by Greenes

that he could ‘‘fix’’ casesein the federal court in

Scranton (see p. 39, infra), testified that follow-

ing a conversation with Korman in New York

(R. 124-125, 127), he telephoned Greenes and

told him that he had a man who “has got a case

up in Scranton’? (R. 129-130). Greenes told

Katz to “Bring him on’’ (R. 130).

In October 1937 Korman filed a petition to be

released from probation (Ex. G-29, Tr. 391,

1117-1120). Henry Mowles, the probation officer,

filed a recommendation that the petition be

granted (Ex. G-30, Tr. 392, 1121-1122) and

Judge Johnson granted it (Ex. G-31, Tr. 393,

1123). Houck, Judge Johnson’s law clerk (R.

146-147), testified that Judge Johnson terminated

the probation without consulting the United

States Attorney (R. 152, 187-188). Houck fur-

ther testified that Judge Johnson told Mowles

“‘to report favorably [on Korman’s petition] be-

cause he was going to terminate the probation

anyhow”’ (R. 153, 192). Houck also testified that

Mowles told him, Houck, that Korman “had a

penitentiary sentence behind him,’’ which Mowles

had reported in his original report, but that he

pe i nat OO IE

had omitted reference to Korman’s “‘record”’ in

his final report (R. 192).

[Greenes admitted referring Korman to Me-

molo and acting as go-between between Memolo

and Donald Johnson, who was to see te it that

Korman ‘‘wouldn’t go to jail.’’ Greenes de-

livered half of Memolo’s fee of $2,500 to Donald,

receiving about $100 for himself. (R. 1174

1175.) Greenes also admitted acting as go-be-

tween between Memolo and Donald when Kor-

man’s probation was terminated. Korman gave

Greenes $1,000 or $1,200 on this occasion, and

Greenes delivered it to Donald, receiving a

‘‘hundred or two” for himself. (R. 1178-1180.) ]

DERVAS TOBACCO COMPANY CASE

In August 1937 a petition for reorganization of

the Dervas Tobacco Company under the bank-

ruptey laws was filed (Ex. G-32, Tr. 396). The

petition was prepared by Frank Butler, counsel

for the company, who testified that he explained

to Judge Johnson that the petition was in the

usual form except that he was requesting that

the company be allowed to remain in possession

and operate the business as a going concern (Tr.

767, 769). Judge Johnson ordered that the com-

pany be allowed to continue in operation and

possession, subject to the supervision of the court

(Tr. 782). On October 20, 1937, Judge Johnson

entered an order reciting that ‘‘after hearing in

open court’’ it was decreed that David Schwartz

be appointed trustee to operate the business (Ex.

ll 27

G-33, Tr. 397, 771-772). Butler testified that he

first learned of this order when it was filed (Tr.

770) and that he “‘wasn’t present at any hearing”’

(Tr. 773). On December 21, 1937, Schwartz

petitioned for allowance of a $2,500 fee for his

services, which Judge Johnson granted (Ex.

G-34, Tr. 397-398, 773-779). Butler testified that

he was unaware either of this petition or the

order granting it until after entry of the order

(Tr. 780); that he and the special master com-

plained to Judge Johnson that the fee was ex-

cessive for only two months’ work; and that

Judge Johnson accordingly reduced the fee to

$1,250 (Tr. 779, 789-790, 806). Thereafter Butler

implored Judge Johnson to further reduce the

fee to $500, pointing out that the company’s pur-

pose in requesting leave to remain in possession

and operation was to minimize expenses, that

Schwartz’ appointment was ‘‘without any notice”’

to the company, that no party in interest sought the

appointment of a trustee, and that the $1,250

fee was ‘‘excessive, exorbitant and entirely dis-

proportionate’’ to the value of Schwartz’ services,

would make reorganization impossible, and com-

pel liquidation, in which event the trustee’s fee

would be only about $100 under Bankruptcy Act

regulations (Ex, G-35, Tr. 399; 781-785). Judge

Johnson, however, refused further to reduce the

fee (Ex. G-36, Tr. 400, 788). Schwartz “*finally

settled for $1,000,’’ which he “was satisfied to

take,”’ and which the company paid to get “rid .

of it’’ (Tr. 790-791).

———»

[Greenes admitted conveying to Donald John-

son Memolo’s desire that Schwartz be appointed

in this case and delivering half of Schwartz’

$1,000 fee to Donald, receiving $25 to $50 for

himself (R. 1163-1164, 1168).]

WILKES-BARRE & EASTERN RAILROAD COMPANY CASE

This was a reorganization proceeding which

arose in 1937 (Ex. G-37, Tr. 402). Judge John-

son appointed Joseph Jennings trustee (Ex. G-

$8, Ty. 403), and David Schwartz as his counsel

(Ex. G40, Tr. 405). Jennings’ salary was $5,000

a year, and Schwartz’ was $4,000 (x. G-39, Tr.

404).

[Gree dmitted recommending Jennings, at

Memolo’s stion, to Donald Johnson as a good

appointment in this case, explaining that he

would ‘‘play ball.”” Memolo was practically

making all appointments by this time, since Don-

ald accepted his recommendations without ques-

tion. (R. 1181-1182.) Greenes gave part of

Jennings’ fees to Donald (R. 1183-1184). Each

month Greenes also gave Donald $233 of Schwartz’

monthly fees of $333, receiving ‘‘the $33” for him-

self (R. 1193-1195). The “‘last money’’ Greenes

gave Donald of Jennings’ fees was $350, which he

received in 1942. Since Donald was out of town,

he instructed Greenes to send the money to him

by check. Greenes, accordingly, asked his brother

Abe to draw a $350 check to Donald’s order and

sent it to Donaid. In 1944, after the ‘‘investiga-

-—

tion’’ started, Jacob Greenes ‘‘felt disturbed”’

about this check because he had thereby involved

his innocent brother in the transaction. He ac-

cordingly arranged with Donald that Donald

“was to say’’ that the $350 was in payment of a

legal fee for having procured for Abe a hotel

cigar-stand concession he operated. (R. 1184—

1188.) ]

GIANT DRY GOODS COMPANY CASE

This was a bankruptcy case that arose in 1940

(Ex. G43, Tr. 1061). Judge Johnson appointed

David Schwartz as receiver (Ex. G44, Tr. 1061-

1062, 1064-1065). He also appointed one Levy

and others to appraise the bankrupt’s assets (Ex.

G45, Tr. 1062, 1068).

Levy, a dry goods dealer and an uncle of

Greenes, testified that he asked Donald Johnson

to remember him ‘‘if he shall have a chance as

an appointment for appraiser’’ (R. 109-111).

He had never before served as an appraiser or in

any other capacity in this court (R. 112). Fol-

lowing his appointment he received a $330 fee

(R. 113). On the day he received it Greenes de-

manded and received $200 of it (R. 113-115).

[Greenes admitted giving Donald Johnson 50%

of Schwartz’ fees in this ease . 1169-1172).

He also knew that Donald ha® arranged for

Levy’s appointment, and admitted demanding

$200 of his fee, but he could not recall whether he

gave Donald any of it or kept it all himself (R.

1171-1172).]

771900—48——5

ana

CENTRAL FORGING COMPANY CASE dk:

This was a reorganization proceeding which

arose in 1938 (Ex. G47, Tr. 415). In December

1941 Judge Johnson appointed Robert Michael

successor trustee (Ex. G-48, Tr. 418) and the fol-

lowing month appointed Donald Reifsnyder as

his counsel (Ex. G49, Tr. 419). On July 9, 1943,

Michael filed his first and final account as succes-

sor trustee (Ex. DJ-12, Tr. 2162).

Michael testified that in 1941 Donald Johnson

told him that there was to be a vacancy in the

trusteeship in this proceeding and suggested that

he ask Judge Johnson to be appointed successor

trustee. Michael did so and received the appoint-

ment. Michael asked Donald Johnson whom he

should have as his counsel. Johnson suggested

Reifsnyder, and the latter was appointed. (R.

235-238. )

Michael further testified that he and Reif-

snyder negotiated with Harry Knight, George

Fenner, and Homer Davis, all of whom had in-

terests in the Maxi Manufacturing Company, con-

cerning a proposed merger whereby that company

would take over the assets of the Central Forging

5 The jury were instructed not to consider, as against peti-

tioner Johnson, certain of the evidence adduced in respect of

this particular proceeding. The reason for the instruction

and the nature of the evidence to which it pertained are ex-

plained in note 6, infra, p. 32. The entire evidence relating

to this proceeding, however, except as indicated in notes 7

and 8, infra, p. 38, was received unqualifiedly as against all

other defendants, and may therefore be considered in its

entirety as further evidence of the conspiracy charged.

Company, and that such a plan of reorganization

was eventually agreed upon (R. 239-244, 285).

Reifsnyder told Michael that they would have to

“figure out some way to take care of Donald

[Johnson].’’ Michael at first objected to this on

the ground that he did not owe Johnson anything,

but Reifsnyder explained that ‘‘it’s understood.

It’s always done.” (R. 245-247.) A plan was

accordingly worked out whereby the accounts re-

ceivable of the Central Forging Company, which

were among the assets that the Maxi Company

was to take over, would be evaluated at $20,000

instead of at their true value of $23,000, the $3,000

difference to go to Fenner as alleged payment for

legal services, with the understanding that Fenner

would retain $500 with which to pay his income

tax on the $3,000 and give the balance to Michael

and Reifsnyder for delivery to Johnson (R. 246,

249-251, 254). Michael asked Johnson whether

he understood the plan and whether it was agree-

able to him. Johnson said he understood and ap-

proved. (R. 247.) The proposed plan of reor-

ganization was approved ‘by Judge Johnson (Ex.

DJ-13, Tr. 2157-2161).

Michael further testified that on April 24, 1942,

he and Reifsnyder met with Knight, Fenner, and

Davis in Knight’s office, and the plan of reor-

ganization was executed by the issuance of deeds,

checks, and other papers (R. 251-252). Among

the checks issued was one for $3,000 payable to

Fenner (R. 252). The parties then went to the

Catawissa National Bank, where the cashier

eashed Fenner’s check (R. 252-253). The

proceeds consisted of six bundles of $20 bills, $500

in each bundle, and each enclosed in a wrapper on

which the name of the bank and the amount con-

tained therein appeared. Fenner took one of the

bundles, and Michael and Reifsnyder, the other

five. (R. 253-255, 281.) Reifsnyder gave this

$2,500 to Johnson on April 25 or 26. Johnson

argued that he should get a third of that plus a

third of Michael’s and Reifsnyder’s combined fees

of $7,900, but Michael insistently opposed this

proposal and finally prevailed in his contention

that all Johnson should get was the $2,500. (R.

257-258,265, 272-275.)°

¢In April 1945 Donald Johnson, Michael, Davis, Fenner,

and Knight were indicted for feloniously appropriating

(count 1) and transferring (count 2) $3,000 of the Central

Forging Company’s bankrupt estate and for conspiracy to do

so (count 3). Reifsnyder was named as a confederate and

co-conspirator. (Ex. DJ-1, R. 537-546.) Seven overt acts

were alleged in the conspiracy count (R. 544-546). The in-

cidents involved in five of these overt acts were among those

testified to by Michael at the instant trial. They were (1)

the meeting of Knight, Michael, Fenner, Davis, attd Reif-

snyder in Knight’s office on April 24, 1942 (overt act 1), (2)

the cashing of the $3,000 Fenner check on the same day (overt

act 3), (3) Fenner’s receipt of $500 (overt act 6), (4) Donald

Johnson’s receipt of $2,500 (overt act 7), and (5) Michael’s

filing of his first and final account as successor trustee on July

9, 1943 (overt act 5). In November 1945 Donald Johnson

was acquitted on all three counts (R. 558-559), and the ver-

dict of acquittal was received in evidence at the instant trial

(Ex. DJ-26, R. 558). In his charge to the jury in the instant

case, the trial judge pointed out that, while “the charge in

that [Central Forging] case and the charge in this case” were

-—

Michael further testified that two years later, in

May 1944, Donald and Miller Johnson told him

that they were being investigated by the F: B. I. .

and asked him whether he was being investigated,

to which Michael replied in the negative (R.

279) ;* and that between July 8 and August 24,

1944, Donald Johnson again asked him whether

he was being investigated, to which Michael re-

plied in the affirmative (R. 276-277). -

Michael finally testified that on August 24,

1944, he repeatedly committed perjury before the

grand jury which subsequently indicted him and

others for abstracting $3,000 from the estate of

the Central Forging Company and conspiring to

do so (see note 6, supra, p. 32) by denying Don-

ald Johnson’s participation in any way in that

case; that he did so in order to protect Johnson;

and that he adhered to his false testimony until

after he pleaded guilty to the indictment in that

case on June 19, 1945 (R. 340, 343-345, 348-358).

Eva Smith, Judge Johnson’s secretary from

1926 to 1942 (R. 498, Tr. 1844), testified that on

different, “some of the facts or incidents” in the two cases were

the same (R. 888), and instructed them that, in order to make

certain that Donald Johnson would not be tried a second time

“on the same set of facts,” they should “not retry as to Donald

Johnson the charges in the [| Central Forging] indictment”

and should not consider as against him in this case any of the

incidents described in the five overt acts, above referred to,

alleged in the Central Forging indictment (R. 888-889).

‘ This testimony was admitted only as against Donald and

Miller Johnson (R. 278).

*This testimony was admitted only as against Donald

Johnson (R. 278).

May 1, 1942, Donald Johnson visited Judge John-

son, and that on the following day she found $500

in the latter’s wallet in one of his bureau drawers

while straightening them up at his direction. It

was ‘“‘a package of [$20] bills with the wrapper

~ stamped on it, ‘The Catawissa National Bank’

and in figures ‘$500.’ ”? (R. 500-501, 505.) Mrs.

Smith, who was very familiar with the sources

of Judge Jchnson’s income, ‘“‘known”’ and other-

wise (infra, pp. 36-37), further testified that Judge

Johnson had no account in the Catawissa National

Bank, and that this $500 was not ‘‘from any of

his known sources of income’’ (R. 502).

The cashier of the Catawissa bank testified that

neither Judge Johnson nor any member of the

Johnson family had ever had an account there

(R. 370).

KOPPELMAN CASE

In January 1943 one Koppelman was charged

in four counts of an indictment with embezzling

Army cloth (Ex. G-50, Tr. 423). Koppelman’s

attorney was David Schwartz (Ex. G-51, Tr.

424). Following a jury trial Koppelman was

found guilty. On July 29, 1943, Koppelman

appeared for sentencing. Judge Johnson made

some remarks to the effect that the Government

had recovered its cloth, and further stated that

he did not intend to take into consideration the

fact that Koppelman was then on probation in

connection with a prior offense. He then fined

Koppelman $1000 on the first count, suspended

the imposition of sentence on the other three

counts, and placed him on probation for a year.

(Ex. G-52, Tr. 425.)

[Greenes admitted acting as go-between between

Schwartz and Donald Johnson in this case.

Schwartz paid Donald $15,000 and told him he

“expected a directed verdict.”” When Koppel-

man was convicted and ‘‘it seemed as though

the commitment hadn’t been carried out,’

Schwartz and Greenes drove to the Johnsons’

summer home and conferred with Judge Johnson

and Donald. Donald told his father that Koppel-

man “‘never should have been convicted,” and

that in his opinion a fine would be sufficient

punishment, with which Schwartz agreed.

Schwartz ‘‘was satisfied with the outeome” and

paid Greenes for his ‘‘help in the matter.’ (R.

1202-1209.) }

KIZIS CASE

In October 1943 one Kizis was indicted for

misapplying bank funds which had come into

his custody as cashier (Ex. G-96, Tr. 483).

[Greenes admitted that Memolo, Kizis’ attor-

ney, asked him to contact Donald Johnson for

help in this case. Donald agreed to “‘handle hey

i. e., see to it that Kizis “‘wouldn’t go to jail,”’

for $15,000.- This was agreeable to Memolo.

Donald, however, wanted Memolo to put up the

money in advance, which Memolo refused to do.

Donald, accordingly, refused to ‘‘have anything

to do with it.’’ Greenes later learned that Kizis

was convicted and sent to jail. (R. 1198-1201.) ]

ADDITIONAL EVIDENCE

In addition to the evidence directly relating

to particular court proceedings as set forth above,

the Government adduced the following evidence

tending to show the existence of the conspiracy

charged and the participation of petitioners and

of Judge Johnson and Memolo in it:

Judge Johnson’s ““unknown”’ sources of income

and Donald Johnson’s connection therewith.—Eva

Smith, Judge Johnson’s secretary from 1926 to

1942 (R. 498, Tr. 1844), testified that two-thirds

of her time was devoted to looking after Judge

Johnson’s personal affairs, including the han-

dling of all his records relating to his income

and expenses, and that she knew all the ‘‘known

sources’’ of his income (Tr. 1842-1845). She

further testified that Judge Johnson received

money in addition to that received from his

‘‘known sources’’ of income and that his receipt

of such money, so far as she was aware, began

in 1936 (Tr. 1845-1846). In ‘‘the beginning”’ he

would give her such additional money in cash to

deposit and tell her to ‘‘mark’”’ it ‘‘a repaid loan,”’

‘‘real estate,’’ or ‘‘court expenses.’’ Later he

used to spend the money and give her the re-

ceipted bills to place in an inventory. (Tr. 1847-

1848.) She began to notice, she testified, that

‘‘whenever the Judge was in possession of

<aeala

money’’ it was always just after a visit from

Donald Johnson (R. 498). In 1939, at Judge

Johnson’s request, she prepared a statement (Ex.

G-129, Tr. 1855) showing all the money he had

received from sources other than his ‘known

sources’’ of income (R. 498-500). The moneys

listed were falsely attributed to sales of real

estate and to ‘‘court expenses’”’ (Tr. 1851-1852,

1856, 1857). She and Judge Johnson discussed

the various items ‘‘as to their correctness”’ (R.

900, Tr. 1853-1854). Judge Johnson also showed

the statement to his son Miller in her presence,

explaining that ‘‘there was a rumor of an investi-

gation,’’ that ‘‘we would have to account in some

way for this money,’’ and that “we are not

going to be caught with our pants down”’ (R.

500).

The connection between Memolo and Judge

Johnson’s orders.—Houck, Judge Johnson’s law

clerk, testified that several of the orders signed

by Judge Johnson \were on “blue backers’ of

Memolo (R. 166-167)\

Donald Johnson’s interest in cases in which

he was not an attorney of record—Houck further

testified that he used to see Donald Johnson about

the court and visiting his father, and that his

visits ‘‘became more frequent as time went on”’

(R. 147-148). He further testified that he re-

called Donald ‘‘frequently asking questions about

cases that were pending in Court’’ in which he

was not an attorney of record (R. 148-149).

———

The $350 check sent by Greenes to Donaid

Johnson.—Abe Greenes, a brother of petitioner

Jacob Greenes, testified that he once operated a

hotel cigar stand (R. 224). In 1942 Jacob asked

Abe to write a $350 check to the order of Donald

Johnson. Abe did so, and gave the check to Jacob

for cash. Jacob did not explain why he wanted

Abe to write the check. (R. 225-227.) In 1944

Abe and Jacob decided on ‘‘a story to tell’’ about

this check. According to the ‘“‘story,”’ the check

was in payment of a fee owed by Abe to Donald

for his having procured Abe’s cigar-stand cow

cession. (R. 228-229.)

An employee of a Swineford, Pennsylvania,

bank testified that according to his bank’s records

Donald Johnson, on October 7, 1942, deposited

a $350 check drawn by Abe Greenes to J ohnson’s

order (R. 712-717).

Donald Johnson, the only, defendant on trial

to take the witness stand, admitted receiving the

$350 check from Abe Greenes, but testified that

the check was in payment for legal services (R.

683-684). He testified that he recorded this pay-

ment in his cash book (R. 683-684, 698-699),

which was received in evidence (Ex. DJ-119, Tr.

2935). All the entries in this book for October

1942 were on separate lines except one, in the

we of $350, which was wedged in between two

other entries (R. 708-709, 737-738).

F. B. I. agent Sowell testified that he examined

Johnson’s eash book in April 1944 and that the

—

October 1942 entry of $350 was not in the book

at that time (R. 737-738). Sowell further testi-

fied that the total of the October 1942 entries had

been increased by $350 from $600.06 to $950.06

between the time he examined the book in 1944

and the trial, the latter figure having been “writ-

ten over’’ the former (R. 740-741).

Greenes’ claim that he could “‘fix’’ cases in the

federal court in Scranton—Phillip Katz testified

that on many occasions Greenes told him that if

he ever heard of ‘anybody that has any case up

in Seranton’’ he should refer such person to him,

Greenes (R. 132, 134), who would “take care

of him’”’ (R. 133). Greenes particularly men-

tioned ‘‘The Federal Court” as a court in which

he could get cases ‘‘fixed’’ (R. 138).

Greenes’ associations with Donald Johnson.—

William Beacham, whose employer shared an

office suite with Donald Johnson in Scranton,

testified that from 1934 to 1941 petitioner Greenes

was a ‘frequent visitor’’ of Donald in the latter’s

office, the visits occurring sometimes ‘‘several

times in one week’? (R. 462-464). Beatrice

Moran, Donald Johnson’s secretary, testified that

Greenes visited Donald approximately once a

week from 1939 to 1941; that Greenes was not a

client of Donald; and that on two or three oc-

casions, When Donald was not in his office, Greenes

left an envelope with her with a message for

Donald (R. 493-496).

—

Greenes’ associations with Judge Johnson and

Donald Johnson—David Martin, Judge Johnson’s

bailiff from 1934 to 1941 (R. 516), testified that

on half a dozen occasions around 1939 or 1940

he observed Greenes and Donald Johnson enter-

ing Judge Johnson’s chambers together when

Judge Johnson was there (R. 519-520, 522-523).

Greenes’ associations with Memolo.—Beatrice

Tighe, Memolo’s secretary from 1933 to 1936,

testified that Greenes, though not a client of

Memolo, visited the latter’s office from two to

eleven times a week; and that on three to five

oceasions she drew checks on Memolo’s account

at his direction, cashed them, and delivered the

money to Greenes on the street or in the hallway

of the building (R. 996-999).

ARGUMENT

1. Petitioner Johnson contends that the Gov-

ernment failed to prove a general, over-all con-

spiracy to obstruct justice as charged; that the

most that was proved was a number of separate,

disconnected conspiracies having no common

figure other than Judge Johnson, who, by his

acquittal, was ‘‘removed * * * as an alleged

conspirator”; that there was no proof that he,

petitioner Johnson, had any connection with eight

of these conspiracies; and that therefore, under

the rule of Kotteakos v. United States, 328 U. S.

750, it was error to try him jointly with the other

alleged conspirators (Pet. 20-30). The conten-

tion is without merit, for the Government did

lll :

prove a general conspiracy as charged and fur-

ther proved that petitioner Johnson was one of

its key members, the others including at least

Judge Johnson, Memolo, and Greenes.

(a) The effect of Judge Johnson’s acquittal on

appellate review of the sufficiency of the evidence

as to his convicted co-defendants.—At the outset

it is necessary to point out that petitioner John-

son is in error in assuming that the acquittal of

Judge Johnson ‘“‘removed him as an alleged con-

spirator, and the key figure” (Pet. 20-21). The

evidence adduced, which we shall review, showed

that Judge Johnson was, in the language of the

trial judge (R. 822), the “heart and core” of the

conspiracy alleged. The jury’s acquittal of him

and conviction of others, therefore, constituted

‘“‘a rational inconsistency between the verdicts’?

(United States v. Austin-Bagley Corporation, 31

F. 2d 229, 233 (C. C. A. 2), certiorari denied, 279

U. 8. 863). It is well settled, however, that the

acquittal of an alleged member of a conspiracy is

no bar te the conviction of other alleged members,

even though under the Government’s theory the

person acquitted was a key member of the con-

spiracy; and by the same token, on appellate re-

view of the sufficiency of the evidence to sustain

conspiracy convictions, the reviewing court is not

precluded from considering the evidence adduced

against an alleged key coconspirator who was

acquitted, to the extent necessary in determining

the adequacy of the evidence adduced against his

convicted fellows. United States v. Hare, 153 F.

2d 816, 818-819 (C. C. A. 7), certiorari denied,

398 U. S. 836; Joyce v. United States, 153 F. 2d

364, 367-368 (C. C. A. 8), certiorari denied, 328

U. S. 860; United States v. Fox, 130 F. 2d 56, 57

(C. C. A. 3), certiorari denied, 317 U. S. 666;

Bazter v. United States, 45 F. 2d 487, 488-489

(C. C. A. 6) ; United States v. Austin-Bagley Cor-

poration, 31 F. 2d 229, 233 (C. C. A. 2), certiorari

denied, 279 U. S. 863; Belvin v. United States,

12 F. 2d 548, 551 (C. C. A. 4), certiorari denied,

973 U. S. 706. It is proper, therefore, for the

purpose of showing that a general conspiracy was

proved as charged and that petitioner Johnson

was one of its members, to review the evidence

tending to prove the corruptness of Judge John-

son’s judicial acts and his participation in the

alleged conspiracy.

(b) The corruptness of Judge Johnson’s judt-

cial acts and his participation in the conspiracy.—

The corruptness of Judge Johnson’s judicial acts

and his participation in the alleged conspiracy

were proved by six principal types of evidence.

These were the questionable character of the acts

themselves; the corrupt transfers of money,

usually in the nature of ‘‘kick-backs,” which fol-

lowed them; Judge Johnson’s proved receipt of

part of such corrupt money in the Central Forg-

ing Company case; his receipt of money from

‘‘ynknown’”’ sources of income; his secret con-

ferences, unexplainable under any hypothesis of

innocence, with Memolo and Donald Johnson in

_ ee

the Williamsport case; and finally his admissions

| against interest. Following is a brief resume of

such evidence:

MOUNT JESSUP COAL COMPANY CASE

(1) Judge Johnson’s reversal of Kil-

cullen’s second report and reinstatement of

the latter’s original finding—Judge John-

son had five months earlier ordered Kilcul-

len to reconsider his original finding. Fol-

lowing the reversal and the payment of the

Winton tax claim, Memolo, the attorney for

the Winton collector, retained exactly half

of the recovery for ‘‘Expenses,’’ his attor-

ney’s fee and ordinary expenses being over

and above this. (Supra, pp. 7-8.) While

Judge Johnson’s actions here were per se,

perhaps, merely suspicious, the inference of

corruption is justified when they are

viewed, as they must be, in the setting of

the evidence as a whole against him.

PENNSYLVANIA CENTRAL BREWING COMPANY CASE

(2) Judge Johnson’s orders directing the

payment of $2,500 and $2,473 to Maloney.—

Maloney had agreed to go “fifty-fifty’’ with

Greenes if the latter got him the appoint-

ment as auditor. Both of Maloney’s peti-

tions for fees were prepared for him by

Memolo. Maloney gave Greenes half of

both fees pursuant to their arrangement.

Maloney worked only three months and his

services were admittedly worth less than a

third of the amount Memolo had him

charge. (Supra, pp. 9-10.)

——

WILLIAMSPORT WIRE ROPE COMPANY CASE

(3) Judge Johnson’s appointment of

Townsend as third receiver—Whereas the

other receivers were experienced wire rope

men who had drawn very substantial sala-

ries as officers of the company before the

receivership, Townsend had previously

been a $3,000-a-year manager of a 45-mile-

long railroad. Yet he was appointed co-

receiver at the same compensation—$1,000

a month—as the others. His only quali-

fication for this position would appear to

have been his long-standing acquaintance

with the Johnsons. He continued his rail-

road work and received his railroad salaty

throughout the more than three years of

his receivership duties. Shortly after his

appointment, Townsend agreed with Miller

Johnson to pay Albert Johnson, Jr. 50%

of his fees in order to help Albert, Jr.

and Donald Johnson pay “some obliga-

tions.’? Townsend made these corrupt pay-

ments throughout his term as receiver.

(Supra, p. 11.)

(4) Judge Johnson’s appointment of

Memolo as co-counsel to the receivers.—

Though the order of appointment stated

that it was made after consultation with

the receivers and with their approval, re-

ceiver Townsend testified that he had no

idea Judge Johnson was contemplating

such a move, and also that he knew of no

particular need for a second attorney.

Judge Johnson later tried to explain why

he had named a second attorney, but

Decker, the original attorney, contradicted

him in this respect. (Supra, p. 12.) The

corruptness of the appointment of Memolo

is further evidenced by the very identity of

the appointee, in view cf the utter corrupt-

ness of his activities reflected throughout

the record.

(5) Judge Johnson’s orders increasing

the compensations of counsel to the re-

ceivers and later of the receivers them-

selves—The motive for increasing Mem-

olo’s compensation was inferably corrupt

for the same reasons that the good faith of

his appointment was suspect. The motive

for the insistence that Townsend’s compen-

sation be increased along with that of the

other receivers, notwithstanding Town-

send’s candid statement that he -was not

entitled to an increase, must be judged in

the light of the fact that half of Townsend ’s

fees were going regularly each month to

Albert, Jr. and Donald, pursuant to his

arrangement with Miller. (Supra, pp. 12-

13.)

(6) Judge Johnson’s conspiracy with

Memolo, Moore, and Donald Johnson to

permat Bethlehem Steel to foreclose its

mortgage for the corrupt consideration of

$225,000.—The Williamsport receivership

was extremely successful and there was

every indication that the company could be

restored to its stockholders within a reason-

able time. Judge Johnson himself insisted

that the stockholders had a clear equity,

which any plan of reorganization would

’

have to take into account. His change of at-

titude in this respect and the beginning of

the proceedings which were to culminate in

Bethlehem’s acquisition of the company at

foreclosure for an amount far less than its -

true value were roughly contemporaneous

with Memolo’s corrupt overtures to Mum-

ford, McMath, and finally to Moore. Mem-

olo’s corrupt dealings with Moore and his

seeret conferences with Judge Johnson and

Donald Johnson during the foreclosure pro-

ceedings point inescapably to a conspiracy

to “sell out’? Williamsport to Bethlehem.

The haste with which the final decree con-

firming the sale was filed is further evidence

of this conspiracy. The evidence showed

overwhelmingly that the ‘‘fees’’ of Memolo,

Crolly, Martin Memolo, and Maloney were

nothing more than an elaborate device for

the payment of the corrupt consideration of

approximately $225,000. (Supra, pp. 13-

22.)

CONTINENTAL CIGAR CORPORATION CASE

(7) Judge Johnson’s appointment of

Crolly as a trustee and of Memolo as coun-

sel to the trustees (supra, pp. 23-24). —While

there is no evidence (admissible against

Judge Johnson) specifically pointing to

anything corrupt in respect of these ap-

pointments, their bona fides must be ap-

praised in the light of Crolly’s proved

complicity in the Williamsport conspiracy

(supra, pp. 19-21) and of the thoroughly cor-

rupt activities of Memolo reflected through-

out the record.

KORMAN CASE

(8) Judge Johnson’s suspension of Kor-

man’s prison sentence.—Katz, who had

been told many times by Greenes that he

could ‘‘fix” cases in the federal court in

‘Seranton, told Greenes about Korman’s

pending case, and Greenes told Katz to

“Bring him on.’”’ Though the government

attorney told Judge Johnson that he had

witnesses who could prove that Korman was

a major figure in the case and urged that he

should receive a substantial jail sentence,

Judge Johnson nevertheless merely fined

Korman. He did, it is true, also sentence

him to a year in prison, but this was obvi-

ously only ‘for the record,’’ since he

promptly suspended its execution. The

corruptness of the sentence is further evi-

denced by the fact that Korman’s attorney

was Memolo. (Supra, pp. 24-25.)

(9) Judge Johnson’s release of Korman

from probation—This action was taken

without even consultation with the United

States Attorney. Mowles, the probation

officer, was told by Judge Johnson to ‘re-

port favorably’’ on Korman’s petition since

he “‘was going to terminate the probation

anyhow.’’ Korman “had a penitentiary

sentence behind him,” which Mowles had

reported in his original report, but which

he omitted from his final report. The omis-

sion was obviously due to J udge Johnson’s

instruction. (Supra, pp. 25-26.)

DERVAS TOBACCO COMPANY CASE

(10) Judge Johnson’s appointment of

Schwartz as trustee.—The debtor company

had requested leave to continue in operation

and possession of its business as an economy

measure, which Judge Johnson permitted

for a while. His sudden order appointing

Schwartz recited that it was made ‘‘after

hearing in open court,’’ but Butler, the

company’s attorney, testified that he knew

of no such hearing. (Supra, p. 27.)

(11) Judge Johnson’s allowance of

Schwartz’ fee.—The original allowance was

$2,500 for only two months’ work, which

Butler protested was entirely unnecessary.

When both Butler and the special master

protested the excessiveness of this fee,

Judge Johnson reduced it to $1,250. Butler

besought Judge Johnson further to reduce

it to $500, pathetically outlining all the

reasons why even $1,250 was entirely out

of line and would make reorganization im-

possible, but Judge Johnson summarily re-

fused his request. Schwartz eventually

‘“‘settled for $1,000,’ which he was glad to

get, and which the company paid to get

‘rid of it.”? (Supra, p. 27.)

WILKES-BARRE & EASTERN RAILROAD COMPANY CASE

(12) Judge Johnson’s appointment of

Schwartz as ‘counsel to the trustee (supra,

p. 28).4-While there is no evidence (ad-

missible\against Judge Johnson) specifically

pointing ‘to corruptness in respect of this

appointment, it is fair to recall, in judging

its bona fides, that Schwartz was the trus-

tee involved in the corrupt appointment in

the Dervas Tobacco Company case (supra,

p. 48) as well as the attorney for the em-

bezzler Koppelman, who received from

Judge Johnson a sentence that was unex-

plainably lenient under any hypothesis of

good faith (infra, p. 51).

GIANT DRY GOODS COMPANY CASE

(13) Judge Johnson’s appointment of

Levy as appraiser—Levy had asked Don-

ald Johnson to ‘remember’? him if he

should ever ‘‘have a chance as an appoint-

ment for appraiser.’ In due time, Levy

received such an appointment from J udge

Johnson in this proceeding, though he had

never acted in a similar capacity before.

On the very day Levy received his fee of

$330, Greenes came around to demand a

$200 ‘‘kick-back.’’ (Supra, p. 29.)

CENTRAL FORGING COMPANY CASE

(14) Judge Johnson’s appointment of

Michael as successor trustee and of Retf-

snyder as his attorney—Michael applied

for this appointment at the suggestion of

Donald Johnson, who informed him that

there was to be a vacancy in the trustee-

ship. Donald also suggested Reifsnyder as

Michael’s attorney. (Supra, pp. 30-31.)

In view of the subsequent events in this

proceeding, the corruptness of these ap-

pointments is obviously inferable.

= a

(15) Judge Johnson’s approval of the

proposed plan of reorganization.—Under

the plan, the Maxi Company was to pay

only $20,000 for Central Forging Company

assets worth $23,000, the $3,000 difference

to go to Fenner as alleged payment for

‘legal services,’’ with the understanding

that he would retain $500 with which to pay

his income tax for the purpose of ‘‘taking

eare of’’ Donald Johnson (supra, pp. 31-34).

That Judge Johnson must have known of

this corrupt deal is evidenced by the fact

that he himself received at least $500 of

this ‘‘pay-off’’ money.

(16) Judge Johnson’s receipt of $500 of

the corrupt $2,500 paid to Donald John-

son.—The $2,500 with which Michael and

Reifsnyder ‘‘took care of’’ Donald Johnson

was delivered to him on April 25 or 26,

1942 (supra, p. 32). Judge Johnson’s

secretary testified that on May 1 Donald

visited his father and that on the following

day she found $500 in $20 bills enclosed in

a wrapper bearing the name ‘‘Catawissa

National Bank’? and the amount, ‘‘$500,”’

in Judge Johnson’s wallet in one of his

bureau drawers. This description of the

money corresponded exactly with the de-

scription of each of the bundles of money

received in exchange for the $3,000 Fenner

check, $2,500 of which was paid to Donald

Johnson. (Supra, pp. 32-34.)

KOPPELMAN CASE

(17) Koppelman’s sentence—Whiie the

United States was fighting a war of sur-

vival, Koppelman was found guilty on four

counts of embezzling Army cloth. He was

on probation at the time, moreover, in con-

nection with a prior offense. Instead of

sending Koppelman to jail, where he be-

longed, Judge Johnson imposed a light fine

on one count and suspended imposition of

sentence on the other three counts, for the

alleged reason that the embezzled cloth had

been recovered. (Supra, pp. 34-35.)

When it is recalled that Koppelman’s at-

torney was Schwartz, the trustee involved

in the Dervas Tobacco Company case

(supra, p. 48), and when the action is

viewed in the light of the evidence as a

whole against Judge Johnson, the only rea-

sonable conclusion that can be drawn is

that Koppelman’s lenient sentence was

bought and paid for.

THE “ADDITIONAL EVIDENCE”

(18) Judge Johnson’s receipt of money

from “wnknown”’ sources of income.—The

receipt »y Judge Johnson of money from

‘“‘unknown”’ sources of income (supra, pp.

36-37) is further obvious proof of the cor-

ruptness of his judicial acts.

(19) Judge Johnson’s admissions in re-

gard to his money from “unknown”

sources.—Eva Smith testified concerning

her preparation, at Judge Johnson’s direc-

tion, of a statement showing all the money

received by him from his ‘unknown’’

sources of income, the statement attribut-

ing the money to false sources. She fur-

ther testified that Judge Johnson explained

—?~

to Miller that the reasons why he had

caused the statement to be drawn up were

that ‘‘there was a rumor of an investigation

being made,’’ that ‘‘We would have to ac-

count in some way for this money,’’ and

that ‘‘We are not going to be caught with

our pants down.”’ (Supra, pp. 36-37.)

and Donald Johnson’s membership in it—From

the evidence so far reviewed (under (b), supra),

it is evident that the Government proved that

Judge Johnson entered into corrupt transactions

with one or more persons in each of ten ° separate

court proceedings. Memolo was proved to have

been implicated in five of these corrupt arrange-

ments (the Mount Jessup Coal Company, Penn-

sylvania Central Brewing Company, Williamsport

Wire Rope Company, Continental Cigar Corpora-

tion, and Korman cases), Greenes in three (the

Pennsylvania Central Brewing Company, Kor-

man, and Giant Dry Goods Company cases), and

Donald Johnson in three (the Williamsport Wire

Rope Company, Giant Dry Goods Company, and

Central Forging Company cases). We think that

even if there were no other evidence this would

suffice to show that at least these four defendants

were members of a general conspiracy to sell

justice and judicial favors wheyever the oppor-

® There was no generally admissible evidence of corrupt-

ness in the Aézis case, the evidence in that proceeding being

limited to petitioner Greenes (supra, pp. 35-36).

tunity arose, and that therefore their inclusion as

codefendants in a single conspiracy indictment

was proper under the rule of the Kotteakos case,

328 U. S. 750. See also, Blumenthal v. United

States, Nos. 54-57, decided December 22, 1947.

There was further evidence, however, from which

it can reasonably be inferred that these four

defendants were common and key figures in all

the specific corrupt transactions described, and

which removes all doubt that they were members

of the unitary conspiracy to obstruct justice as

charged. This further evidence may be recapitu-

lated as follows:

(1) Eva Smith’s testimony that she be-

gan to notice that whenever J udge Johnson

was in possession of money from corrupt

sources it was always shortly after he had

seen Donald (supra, pp. 36-37) ;

(2) Houck’s testimony that Donald John-

son’s visits with his father “‘became more

frequent as time went on” and, further,

that Donald used frequently to ask him,

Houck, questions about eases pending in

court in which he was not an attorney of

record (supra, p. 37) ;

(3) Greenes’ sweeping claim to Katz that

he could “fix”? cases in the federal court

in Seranton (supra, p. 39), a claim which

he substantiated in the Korman case ;

(4) Beacham’s testimony that Greenes

was a “frequent visitor’? of Donald John-

son, the visits occurring sometimes several

times a week (su pra, p. 39) ;

(5) Beatrice Moran’s testimony that

Greenes visited Donald Johnson weekly,

though not a client, and that Greenes would

sometimes leave an envelope with her for

Donald when the latter was out (supra, p.

39) ;

(6) Martin’s testimony that he observed

Greenes and Donald Johnson entering

Judge Johnson’s chambers together on half

a dozen occasions when Judge Johnson was

there (supra, p. 40) ;

(7) Beatrice Tighe’s testimony _ that

Greenes, though not a client of Memolo,

used to visit him from two to eleven times

a week, and that on three to five occasions

she drew checks on Memolo’s account at

his direction, cashed them, and delivered

the money to Greenes on the street or in

the hallway of the building (supra, p. 40) ;

(8) Houck’s testimony that several of

the orders signed by Judge Johnson were

on “blue backers’? of Memolo (supra, p.

37) ;

The cumulative force of this further evidence,

we submit, proves beyond doubt that Donald

Johnson, Greenes, and Memolo did not merely

enter from time to time into individual, particu-

lar, ‘‘small”? conspiracies with one or another

of themselves, Judge Johnson, and others, but that

all four were parties to a single general conspir-

acy, unlimited in its scope, to obstruct justice and

defraud the United States as charged. Their

joint trial, consequently, was proper under the

rule of the Kotteakos case. See also Canella vy.

United States, 157 F. 2d 470 (C. C. A. 9)”

2. Petitioner Johnson’s further contention that

the evidence is insufficient to support the verdict

as to him (Pet. 31-34) is patently without merit.

The evidence already reviewed in connection with

Johnson’s first contention necessarily included

much of the evidence directed against him specifi-

cally. The only evidence already reviewed which

may not be considered in determining the suffi-

ciency of the evidence against him specifically

* It was necessary, of course, for J udge Johnson, Donald

Johnson, Memolo, and Greenes, in carrying out their over-all

conspiracy, to enter into particular corrupt agreements from

time to time with other persons in connection with the various

court proceedings that were to be affected by their grand con-

spiracy. Thus Kilcullen was brought into their broad plan

in connection with the Mount Jessup case, Maloney in the

Pennsylvania Central Brewing Company and Williamsport

cases, Townsend and Moore in the Williamsport case, ete. It

must be emphasized that this case involves no question as to

the propriety of trying such “temporary” participants in the

main fraud jointly with its four “permanent” members. The

persons in this case having a thus limited relation to the

grand conspiracy occupied positions similar to those of

Kotteakos, Lekacos, and Regenbogen in the Kotteakos case,

and of Wyckoff and McCormac in the Canella case. The

four “grand conspirators,” on the other hand, occupied posi-

tions precisely analogous to those of Canella and Campbell

in the Canella case (see 157 F. 2d, at 478-479). Similarly,

if in the Xotteakos case two or more “common and key”

figures be postulated in place of the actual single figure,

Brown, the members of the grand conspiracy here would be

analogous to them. In short, to use the “wheel” figure of the

Kotteakos case, Judge Johnson, Donald Johnson, Memolo,

and Greenes constituted the center of the wheel, whose spokes

connected them with the many persons in the same category

as Kilcullen, Maloney, Townsend, and Moore.

ie.

is the evidence that he conspired with Michael,

Reifsnyder, and the others involved in the Cen-

tral Forging Company case fraudulently to ab-

stract $3,000 from the bankrupt estate and that

he received $2,500 of this money himself (see (b)

(15) and (16) under point 1, supra). The reason

why that evidence may not be considered as

against Johnson is explained in note 6, supra,

p. 32. Even eliminating this evidence from con-

sideration, however, the remaining evidence

against him plainly warranted his conviction (see

(b) (3), (6), (13), and (14), and (¢) (1), (2),

(4), (5), and (6) under point 1). There is,

moreover, the following additional evidence

against Johnson:

(1) Michael’s testimony that in May

1944 and again sometime between July 8

and August 24, 1944, Donald Johnson came

to ask him whether he, Michael, was being

investigated (supra, p. 33). These were

obviously not missions of innocence.

(2) The $350 check incident. Abe

Greenes testified that he drew a $350 check

to Donald Johnson’s order in 1942 at the

request of his brother Jacob and gave it to

Jacob in exchange for $350 in cash. Abe

did not know the purpose of the trans-

action, but in 1944, he admitted, he and

Jacob decided on a false ‘‘story to tell’

about the check—the ‘“‘story”’ being that

the check was in payment of a fee owed

by Abe to Donald for his having procured

Abe’s cigar-stand concession. The corrupt

nature of this payment is conclusively

shown by the F. B. I. agent’s testimony that

a $250 item was added to the entries in

Donald Johnson’s cash book for October

1942 sometime between April 1944 and the

trial. (Supra, pp. 38-39.) The jury were

fully justified in inferring that this corrupt

payment to Donald Johnson had some

connection with the conspiracy charged.

It is not, of course, a valid criticism of the

Government’s case against petitioner Johnson to

say that the evidence against him was largely

circumstantial, since conspiracy can often be

proved in no other way. United States v. Man-

ton, 107 F. 2d 834, 839 (C. C. A. 2), certiorari

denied, 309 U. S. 664. Two courts have upheld

the sufficiency of the evidence to warrant submis-

sion of the question of Johnson’s guilt to the jury.

There is clearly no occasion for this Court to

disturb their findings. Cf. Delaney v. United

States, 263 U. 8. 586, 589-590."

3. Petitioner Johnson’s further contention that

the Government failed to prove the commission

of an overt act within the limitations period (Pet.

35-42) is also without merit.2

* Petitioner Greenes also challenges the adequacy of the

proof of a general conspiracy and the sufficiency of the evi-

dence to sustain his conviction (Pet. 11-13). In view, how-

ever, of his admissions before the grand jury, in which he

fully confessed his major role in the vast conspiracy, his

contentions in this respect obviously require no answer.

* Petitioner Greenes also makes this contention (Pet. 13-

15), but it scarcely can be taken seriously in view of the fact

that his grand jury testimony contained numerous admis-

sions of overt acts committed within three years of the indict-

ment’s return (see pp. 10, 35, supra).

“=

The indictment was returned on September 11,

1945 (R. 1) and the jury were instructed that

they must find that an overt act in furtherance

of the conspiracy was committed within three

years prior thereto (R. 814, 863). The follow-

ing overt acts were proved to have been com-

mitted within that period:

(1) Greenes’ sending of the $350 check

to petitioner Johnson on or about October

7, 1942 (supra, p. 38) ;

(2) Michael’s commission of perjury, on

August 24, 1944, before the grand jury

which subsequently indicted him and others

in the Central Forging Company case, for

the admitted purpose of protecting Donald

Johnson ; he adhered to this false testimony

until he pleaded guilty to that indictment

on June 19, 1945 (supra, p. 33) ;*

(3) Michael’s filing of his first and final

account as successor trustee in the Central

Forging Company case on July 9, 1948

(supra, p. 30) (alleged overt act No. 33,

R. 1084) ;

(4) Judge Johnson’s sentencing of Kop-

pelman on July 29, 1943 (supra, pp. 34-35)

(alleged overt act No. 6, R. 1082).

It is true that the first two of these overt acts

were not alleged in the indictment, and that the

trial judge instructed the jury that they were

required to find that ‘‘an overt act as charged”

18 Since it was part of the conspiracy charged to conceal its

existence (R. 1080), Michael’s perjury was clearly an overt

act in furtherance of it.

was committed (R. 814; see also R. 821, 863).

However, that instruction was obviously too

favorable to the defendants (as Johnson admits

(Pet. 35, 41)), since it is well settled that the

Government is not limited in its proof to the

overt acts charged. Lias vy, United States, 51 F.

2d 215, 217 (C. C. A. 4), affirmed, 284 U. S. 584;

Meyers v. United States,.36 F. 2d 859, 861

(C. C. A. 3), certiorari denied, 281 U. S. 735;

Worthington v. United States, 1 F. 2d 154, 155

(C. C. A. 7), certiorari denied, 266 U. S. 626."

It is also true that the third of the above overt

acts was one of the items of evidence which the

jury were instructed not to consider as against

petitioner Johnson (see note 6, supra, p. 32). It

was, however, admissible as against all other de-

fendants, and consequently the jury were entitled

to consider it in determining whether the con-

spiracy charged had continued to within the limi-

tations period, even though they could not con-

sider it in weighing the specific question of the

guilt of petitioner Johnson. In any event, the

fourth of the above-listed overt acts was both

‘* Furthermore, there can be no question as to the fact of

Donald Johnson’s receipt of the $350 check, since he admitted

it, his only contention being that it was an innocent fee pay-

ment by Abe Greenes (supra, p. 38). The Government’s

proof to the contrary, however, which included the testimony

of Abe himself that the “story” about the $350 being a fee

Was purely imaginary, was overwhelming (supra, pp. 38-39).

alleged and proved and was admissible against all

defendants.”

4. Petitioner Johnson’s further contention

(Pet. 42-44, 6-7) that the trial judge erred in

applying the doctrine of collateral estoppel is

likewise unmeritorious. As we pointed out in

note 6, supra, p. 32, Johnson had previously been

acquitted of conspiring with Michael, Reifsnyder,

15 It should be pointed out, moreover, that the trial judge’s

instruction that the jury were required to find an overt act

that occurred after September 11, 1942 (three years prior

to the indictment’s return) was far more favorable to the

defendants than was required, in view of the special war-time

statute tolling the statute of limitations for certain offenses.

That statute (Act of August 24, 1942, c. 555, § 1, 56 Stat. 747,

as amended by the Act of July 1, 1944, c. 358, § 19 (b), 58

Stat. 667 (18 U. S. C., Supp. V, 590a)) provides in pertinent

part:

“The running of any existing statute of limitations appli-

cable to any offense against the laws of the United States (1)

involving defrauding or attempts to defraud the United

States or any agency thereof whether by conspiracy or not,

and inany manner * * * shall be suspended until three

years after the termination of hostilities in the present war

as proclaimed by the President or by a concurrent resolution

of the two Houses of Congress. This section shall apply to

acts, offenses, or transactions where the existing statute of

limitations has not yet fullyrun * * *.”

This statute was directly applicable to the offense alleged in

the instant indictment, which charged a conspiracy to de-

fraud the United States as well as to obstruct justice (supra,

pp. 4-5). Its applicability was evidently overlooked at the

trial. The effect of the statute was to make the crucial date

so far as the statute of limitations was concerned—i. e., the

date after which an overt act was required to be found—not

September 11, 1942, as the jury were told, but August 24, 1939

(three years prior to the enactment of the above statute).

and the others involved in the Central Forging

Company case to abstract $3,000 from the bank-

rupt estate of that company, and of committing

the substantive offense. The indictment in the

earlier case and the verdict of acquittal as to

Johnson were received in evidence in the instant

case (note 6, supra), and the jury were instructed,

in effect, that in weighing the question of John-

son’s guilt or innocence they were to assume his

innocence of the charges in the Central Forging

Company indictment (R. 888-889). They were

expressly told that they could ‘not retry as to

Donald Johnson the charges in the [Central

Forging] indictment” (R. 888). Moreover, the

judge went much farther than necessary by his

further instruction that the jury could not con-

sider as against Johnson any evidence which

tended to prove any of the five overt acts men-

tioned in the earlier indictment of which evidence

was received in this case (R. 889). One of those

overt acts, the judge explained, was the alleged

receipt by Johnson of $2,500, and even though

he did not believe that “that fact was squarely

an issue in that case,” * he nevertheless told them,

* In his opinion overruling motions for judgments of

acquittal notwithstanding the verdicts. the judge explained,

as follows, why he believed that Johnson's acquittal in the

Central Forging case did not by any means necessarily estab-

lish that the jury found that Johnson did not receive this

$2,500: “It is perfectly apparent in this connection that

Donald Johnson may have received the money as charged in

the former indictment as an overt act, but the jury might have

os.

in order to be ‘“‘perfectly sure”? that Johnson’s

rights were fully protected, that they could not

consider even that evidence against him in this

case. Under the doctrine of collateral estoppel,

all that the judge was required to tell the jury |

was that Johnson’s acquittal in the earlier case |

established, for this case, his innocence of the

charges in the earlier case. See United States

v. De Angelo, 138 F. 2d 466 (C. C. A. 3). Clearly

he was not required to tell them that they could

not consider in this case evidence of the overt

acts allegedly committed in furtherance of the

conspiracy charged in the earlier case, since it is

evident that the jury in that case might very well

have believed those acts to have been proved and

still have thought Johnson innocent of the charges

of the indictment, which was all that their verdict

of not guilty established.

5. Both petitioners contend (Johnson Pet. 44-

45; Greenes Pet. 16-18) that the trial judge

should have declared a mistrial because the prose-

cutor, in his rebuttal argument to the jury, ealled

defense witness Moore a ‘‘criminal conspirator as

found that he had no idea that the money came from the

trustee or was part of the assets of the bankrupt estate. He

may have thought that it was part of the legitimate fees

allowed to the attorneys which was paid to him on account

of his supposed influence” (R. 933). He stated that his in-

struction to ignore Johnson’s receipt of this $2,500 in con-

sidering his connection with the conspiracy charged in this

case went “very much further than defendant Donald

Johnson was entitled to have the court go under any rule

whatsoever” (R. 933-934).

established by the evidence in this case’’ (see

R. 796-797). It is claimed that “there was ab-

solutely no basis” for this remark (Johnson Pet.

44). The contentions are patently insubstantial.

The evidence adduced (pp. 14-22, supra) proves

beyond question that the prosecutor’s characteri-

zation of Moore, far from being false or ex-

aggerated, was no more than fair comment. De-

fense counsel, in his summation, had previously

extolled Moore as a man of “‘fine qualities’’ (Tr.

3700), “fan example of an honest man and a

good fellow’’ (Tr. 3701), and a “‘fine old gentle-

man”’ (Tr. 3703). It was fair rebuttal, therefore,

for the prosecutor to portray him to the jury in

the truer light. "9

6. In Edgington v. United States, 164 U. S, 361,

this Court held that an instruction that ‘evidence

of good character could only be considered if the

rest of the evidence created a doubt of defendant’s

guilt’’ (p. 366) was erroneous, observing (ibid.) :

Whatever may have been said in some

of the earlier cases, to the effect that evi-

dence of the good character of the defend-

ant is not to be considered unless the other

evidence leaves the mind in doubt, the

decided weight of authority now is that

good character, when considered in con-

nection with the other evidence in the case,

may generate a reasonable doubt. The

circumstances may be such that an estab-

lished reputation for good character, if it

is relevant to the issue, would alone create

a reasonable doubt, although without it

the other evidence would be convincing.

Petitioner Johnson contends that the instructions

in this case in respect of character evidence failed

to meet the requirements laid down in the Edging-

ton case (Pet. 46-50). This contention is also

meritless. The judge made it perfectly clear to

the jury that they were to convict if they had

no reasonable doubt of guilt after considering all

the evidence, including the evidence of good repu-

tation, and, conversely, that they were to acquit

if they had such a doubt after considering all

the evidence, likewise including the evidence of

good reputation (R. 895-896). This instruction

was clearly correct. It is true, as stated in the

Edgington case, that ‘‘The circumstances may be

such that an established reputation for good

character * * * would alone create a reason-

able doubt,’’ but plainly this Court did not mean

thereby to imply that a jury had to be so in-

structed in haec verba, as Johnson seems to as-

sume. Rather, this Court was merely stating

what might result in some cases from the jury’s

application of the correct rule. It is uniformly

held to be proper to refuse a charge that evidence

of good reputation may alone suffice to create a

reasonable doubt. Boehm v. United States, 123

315 U.S. 800; Haffa v. United States, 36 F. 2d 1,

5 (C. C. A. 7), certiorari denied, 281 U. 8. 727;

Kreiner v. United States, 11 F. 2d 722, 726 (C.

C. A. 2), certiorari denied, 271 U. S. 688; Kauf-

mann Vv. United States, 282 Fed. 776, 785 (C. C. A.

3), certiorari denied, 260 U. S. 735.

7. Petitioner Johnson further contends that the

trial judge erred in not instructing the jury that

they must find the dates of the beginning and end

of the conspiracy on the ground, apparently, that

in the absence of such an instruction the jury

might have based their verdict of guilty on im-

proper acts not connected with the conspiracy

charged (Pet. 50-51). However, the jury were

told that they must find that the conspiracy

alleged existed and that it continued to within

three years of the indictment’s return (R. 814).

They were further cautioned that ‘‘even if the

parties hereto are proven guilty of having done un-

lawful acts that might otherwise be defined as

crimes, the only crime that they can be convicted of

under this indictment is the crime of conspiracy”’

(R. 819). The judge also made it abundantly clear

to the jury that the defendants were on trial only

for the broad general conspiracy charged and

that even if the jury believed beyond a doubt that

a number of ‘subsidiary conspiracies’? had been

proved, that would not suffice to warrant verdicts

of guilty (R. 831-832). There were similar in-

structions to the same effect, moreover, which

fully covered the matter (see R. 826-829, 831-

832). Consequently there is no basis whatever for

this contention.

66 |

8. Both petitioners urge that the trial judge

invaded the province of the jury by telling them

that some of the overt acts alleged had been

proved (Johnson Pet. 51-52; Greenes Pet. 18 |

22). The allegedly offending remarks of the |

judge are as follows (R. 821):

In the indictment in the case at Bar there

are charged forty-six overt acts * * *,

Some of them have been proved by the

United States.

It is manifest from the context in whieh these

words occur, howéver (see the language which

immediately follows), that by ‘‘overt acts’’ the

judge meant nothing more than acts in the ob-

jective sense—i. e., dissociated from any pos-

sible corruptness arising from their having

been done to further the objects of the alleged

conspiracy. That some overt acts in this sense

had been established was conceded (see R. 901-

902). The judge very clearly left it to the jury

to decide whether such acts or any others they

might find had been committed for the purpose of

furthering the objects of the conspiracy. Subse-

quently, moreover, after his charge had been

criticized by counsel (R. 900-902), the judge sup-

plemented his prior instructions in this respect in

such a way as to leave no possible doubt that it

was the jury’s function to determine whether an

overt act done to further the conspiracy had been

proved (R. 907). No further criticism of the

charge in this respect was made.

| <xeummecicl

9. The Government introduced in evidence peti-

tioner Greenes’ admissions made before the grand

jury on two days (R. 1103). Greenes contends

| that it was error to permit the Government to

| introduce these admissions without also requiring

it to introduce the remainder of his testimony

before that body, given on thirteen other days

(Pet. 23-26). There is no merit in the conten-

tion, The rule that if part of an admission is

| introduced the remainder must also be introduced

means no more, as the court below pointed out,

than that any admissions against interest must be

“given sufficiently in their context so that the

jury may have an accurate notion of what was

said and under what circumstances” (R. 1231).

Here, the admissions received consisted of

Greenes’ complete, word-for-word testimony on

two successive days, and there was no attempt

whatever to select only the most damaging ad-

missions, torn from context. Plainly there was

no reason, as the court below observed (tbid.),

‘““why the record should have been unduly clut-

tered with all the Grand Jury testimeny.”’ See

Medlock v. State, 108 Tex. Cr. 274, 279; Shaw v.

State, 73 Tex. Cr. 337, 339; ef. Schoborg v. United

States, 264 Fed. 1, 9 (C. C. A. 6), certiorari

denied, 253 U. 8. 494.

CONCLUSION

The judgments below are correct, and no con-

flicts of decisions are involved. We therefore

respectfully submit that the petitions for writs

of certiorari should be denied.

Puiuie B. PERLMAN,

Solicitor General.

T. VINCENT QUINN,

Assistant Attorney General.

Rosert S. ErDAHL,

Puitie R. MoNAHAN,

Attorneys.

JANUARY 1948.

U.S. GOVERNMENT PRINTING OFFICE: 1948

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