# Petition for Writ of Certiorari — Sachs v. United States (No. 510) > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386420_1306%3A2 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition for Writ of Certiorari - **Published:** January 1, 1961 ## Text -— = Office-Supreme Lourt, U.S. . FILE COPY dices | | OCT 20 1961 JAMES R. BROWNING, CLERK IN THE SUPREME COURT OF THE UNITED STATES. OCTOBER TERM, 1961. , B10 LEONARD J. SACHS, Petitioner, versus UNITED STATES OF AMERICA, Respondent. PETITION FOR A WRIT OF CERTIORARI To the United States Court of Appeals for the Fifth Circuit. HOSEA ALEXANDER STEPHENS, 509 Grant Building, Atlanta 3, Georgia. Counsel for Petitioner. SMITH, FIELD. RINGEL, MARTIN & CARR, Attorneys at Law, 909 Grant Building, Atlanta 3, Georgia, Of Counsel. PES OD PP el Me wcities tee dlamielbaias —— St. Lours Law Pristive Co., Ive., 415 N. Eighth Street. CEntral l-4477. INDEX. Pare NN ee nc 8 er eas a Ske xiete e's l I car ee aa eae ons we e SE eg tar ny eee A 2 I NN G8 ogc Saag a hy Go ko ack Sw a ms ) aa ick ba Chie oe eles 4 measens tor gvaniine the writ ..................... ‘ a gaa ee TILT GATS AI 7 as i I Appendix 1--Opinion in District Court oo. 000... 1 ; Rae BP Appendix T1—Opinion im Court of Appeals 00... .. YY) Appendix TT—Analysis of Balanee Sheet dtems= of Fulton Trouser Comipans as of Feb- hr es og es os Jo — Analysis of TIneome & Expense Pens of Fulton Trouser) Company as of Pee Ge BOO oe ak ct! wh Cases Cited. Boykin v. Huff (App. D.C.). 121 FL 2d sin, si2 oo... 13 Carroll Vocational Institute ve United States, 9 Cin, ee a I eo vie g'g Ss dew Sh aww es 4 Preidus v. United States (App. Do ©.). 225 FL 2d Sus. og 19 Marvland Casualty Company v. Jones, 274 US. Tae, og I ET OPIS SER EO ina Ne Bea egg eean yar AL ARO ae 1: Terry v. United States, S Cir, 151 FL 2d 40... 2 United States ex rel. Starr ve. Mulligan (App. D. ©), ee wn eh ons S4S s i Uuited States v. Borth, 10 Cir, 266 FL 2d 521 United States v. Levin (D.C. Colo), T8n BL Supp ss United States vo MeNineh, 256 U.S. 495. 2 Law bal CON SR eae aa Sie Tea eerie eine eg ere United States v. Moore, 5 Cir. 185 F. 2d 9. aa United States v. Stark (D.C. Md.), 181 Fo Supp Te Weinstock v. United States (App. D. C.), 251 Fo 2d oe Statutes Cited. DU. st. i t:, 15 U. Is U. 1s 0. mT. 3 ie ae ee Se a ae oe ks cc es es . €.. Beetion G4 {c) ...... eee hty cee Nar Dee ., Beetsee G4s Ca) 2. ne ce.. are pi RU Ae sg) ys os Sk ce ee a oo Lr SI. TF. Tete FONE gnc. cs Henry Garnicit Company March 6, Woz Wiil Manufacturing Company — June 35, 19.0 Federal Sportswear, Ine. July 10, 7452 appellant being President and a Director of Fulton Trouses and Henry Garment Company and Witham Sachs bere the Secretary-Treastrer and a Director theree?, That on or about March 27, 1954. defendants, for the purpose of obtaining a contract from: the Air Material Con mand, United States Air Foree, made and used a balance sheet of Fulton Trouser Company, Ine. as at February 2s, Hod, and a statement of income, profit and loss for January 1, id. to Pebruary 28, 1254, which did not set forth a true statment of dts assets, diabilities. finaneial structure and condition, well knowing said writings and documents were false, fietitious and fraudulent (RL Vol Top. 3). The second count, after adopting the preliminary allega- tious of count one by reference, charged that on or about April 28, 1954, defendants for the purpose of having the “corporations” designated as Small Business Concerns by Small Business Administration, had made and used a let- ter dated April, 28, 1954, quoted therein in its entirety, addressed to the Regional Director, Small Business Ad- ministration, Atlanta, which omitting formal parts stated R. Vol. 1, pp. 4-5): “The Henry Garment Company, located at 166 Gar. nett Street and Fulton Trouser Company, loceted at -2o Central Avenue are affiliated) companies. The Henry Garment Company has an average number of employees of 108. Fulton Tronser Company lias an average number of 375 employees. “The Henry Garment Company and the Fulton Trouser Company have no connection whatsoever with Will Manufacturing Conipany, Atlanta, Georgia, aud Federal Sportswear, Atlanta, Georgia. “This is to certify that there is no financial or or ganizationnl connection between the twa companies, Henry Garment Company and Fulton Trouser Cor pany, Inc., and the two companies, Will Manufaetur- lag Company and Federal Sportswear.” patra js the defendants well knowing said letter: was fo'- tious, and fraudulent in that the said “eorporation in faet affiliated with ench other, had finaneral and ore iwational connections with each other, and were not sy business concerns as established by law, rules aud resi. tions of the Smit) Business Administration, as detendunts well knew, A timely motion to dismiss count two was filed ho¥ opp. 7) upon grounds averring substantially (2) No offense against the laws of the Uanited States os. alleged; (h) The letter set forth therem, even if made audous as alleged and if false. fictitious and fraudulent as aise does not fall within the ambit of Seetion Took. Tor. ts. United States Code, nor proscribed thereby: (¢) The designation of the named corporations oss: business concerns by Small Business Administration is) the exereise of jurisdiction contemplated by Sector i! Tithe IS, United States Code, so as to make the wets therein setoutamaterial within the purview or said regarded the decision of this Court in United States Vv McNinch, 356 U.S. 595. 2 Law Ealition 1007, Wherein! Court held that a false statement in an application te! Federal Housing Administration for eredit) msnrine not actionable under the False Claims Act (31 |. >. | 231) since such is not a claim against the Governmen Likewise, the Fifth Cireuit Court of Appeals disresin its own decision in United States v. Moore, 5 (‘ir.. I> F 92, in which it considered Section 80, Tithe Is, Ur States Code, being the predecessor seetion to the pre Section 1001, as well as the following: United States ex rel. Starr v. Mulligan (A). |). | 59 FB. 2d 200, 202 (Application for Civil Serve Ixamination);: ons, ae United States v. Stark (1). Mad). 131 F.Supp. 190, and United States v. Levin (1). ©. Colo), 153 FL Sip ss (Interrogations hy FL OB. DT. Agents): Terry v. United States, 8 (ir. 131 FL 2d 400 ¢(Pedera! Housing Adiinistration Credit) Applications) ; United States v. Borth, 19 (ir, 266 1. 2d S21 CAp- plication by Veteran tor sickness benetits). Petitioner submits that the exercise of jurisdiction ean. terrspolaatered by Section L001, Tithe IS, United States Code, is tundamentally different from that contemplated ly Section 641 (e), Tithe 15, United States Code. In Carroll Vocational Institute v. United States, 5 Cir. 211 I. 2d oo, 40, the Fifth Cirenit Court of Appeals stated: Jurisdiction means the right to sayoand the power to act: . The decision of the Ritth Cirenit: Court of Ayipeais conn pletely ignores the foregoing holdings and concepts. IT. In permitting the judeiment te -tand as to count one of the indicgmoent, the Fifth Cirenit Conrt of Appeals ren dered a decision which is in contlict with the decision of the Court of Appeals of the District of Columbia in Freidus v. United States (App. D. (7), 223 F.2d S08. which actually constituted a physical precedent for the case at bar, its farts hearing striking similarity to the evidence offered by the Government against petitioner. The conrt there enphasized the following matters: “We think, however, that this highly ed nad statute tust be construed as requiring admaterie’ falsifiention. * * > * + * * “The financial statement submitted was materially false only af it misrepresented Starrett’s ability te — oo repay a loan by misstating profitability, assets, liabilities.” The ultimate issue here involved was not abiliry te repay a loan as none such was sought or granted. Th concern was only ability to produce goods to fultl Government contract. The goods so ordered having bee produced, delivered, accepted and, as the evidence in ti: instant case indieated, actually overrun and. seh ade tional goods so accepted and paid for, the talse represeut tions, if any, contained in the financial statement wer conclusively demonstrated to be not material within te purview of Section 1001, Title 18, United States Cove. -* The language of the Court of Appeals of the Distru: of Columbia in the Freidus Case (p. 601), detionstrats the Jack of such materiality: “As the Government says, appellant senght ‘ts arrive at oa financial statement more palatable ts creditors.’ But that purpose in no way reduces the Government’s burden under the false statement she ute; it must still prove that the specified entries ws objectively false, and were made, wilfully and wo knowledge of falsity, in a material matter within jurisdiction of a department or ageney of the ni States.”” ’ The decision of the Fifth Cireuit Court of Appeals ten likewise conflicts with the decision of the Court oF \ peals of the District of Columbia in Weinstock v. United States (App. D. €.), 281 F. 2d 669, pointing mp ie itv'’ in the fellowing language: Material’ when used in respect ta eviders often confused with ‘relevant’, but the two tere > hi wholly different meanings. To be ‘relevant ) mits | relate to the issue. To be ‘material’ meats 1 | oe probative weight, i.e. reasonably likely te us as OE the tribunal ino making a determination required te be made. AC statement may be relevant but met mia terial. "ee dee Cen gy Materiality must be jadged by the faets and. cir cumstances dn the parthouhkur ease. The eolor of an accused's hair omay be totally imamaterial im one ease, bui in other circumstances the color ot his hain ras be net only giateriab but decisively sa’ Ne pretense was qniade by the Government that the i nanenal statement was sought or desired for any purpose other than demonstrating the Fulton Prouser Companys could produce goods to tnllill a Government contiaet. Naw thesis that it contd not do so was entively disproved bw the production, delivery. and aeceptanee of the goods ordered, So far cas the statement itself was concerned, despite any criticism made of it by the awent of the Bed eral Bureau of Tnvestigation who undertook to make aed Metments therein, profits for the period in question were fied at $17,077.10, or only SLND less than that) shew on the statement submitted. towit: 200TH 25. The state ent as submitted. ane the statement as aelpusteed, ~hhaoweed aodetiert? of $14,206.20, This Honorable Court has never considered, cdeterteined, and pronmleated staudards woverning “materiality ae this word is used in the Frand Statute (Pitle IS. Seetion IW TS. Cl). and there is here presented a elear oppor: Mnity fora vardstick to be furnished by whieh prosecu Tors cand defense counsel may be euided ino the future. Petitioner submits this is particularly important in view of the fae that the Departrivercnt of ustiee shows a clear breferenes fo proscente under Seetion TOOL rather than Wider the speeifie penalty statutes spelled ont by Congress Hoestublishing Small Business Administration and wherem ! Uhter sanctions were imposed. a. om III. The deeision entered by the Fifth Cirenit Court or \ peals in the instant case failed to take motiee Gf arco | npou all of the assignments of error mace therein. Th assignments of error presented (a) Sufficiency of the evidence te support a verter. cnilty on comit two of the indictment, sene havin 5 erved by motion for judgement of acquittal mor! the conelusion of all of the evidenee and theres" motion for judgement of acquittal notwithstanday » verdict: (b) Permitting a special agent, Internal Revenue Se ier, to testify over objection that Fulton Prouser Coie ewed $34,872.74 in FICA and Withholding Taxes a- February US, 154. the date of the finamedsl stat. whieh formed the basis of the proseention on ean on and thereby on objeetion by the Government sane): the effort of petitioner's counsel to establish tiat te. taxes were snbsequenthy paid: and ce) Admitting into evidenee eertain documents ov) had been submitted by Fulton Trouser Company te Jar and Company on November 16. 1995. whiely decane! certified that as of that date all of the stoek of Will We nfacturing Company and Federal Sportswear, Pre. wb owned by petitioner, Leonard .E Sachs, over abjecin- that these doetanents were never presented to nor cet: on by any Government Ageney; the date of sare wee e least six months antecedent to the representation mice | Small Business Administration on April 28,0 Ped. con plained of in count two of the indictment; and that | such documents were admissible in evidence at all would be only for the limited purpose of tmpeachct’ after petitioner had taken the stand and testified tnt CAUSE, Which objections were overruled, The omission of the Fifth Cirenit: Court of Appeals te netice and rte upon these assignments was timely called fo tts attention in the petition for rehearing in Ground TL on pare 4 thereof (Ro Vol TE. pm. 4P). Petitioner submits this ferred to in Count One, the information requested Paragraph 1 (a), (b) and (¢) above. 3 As to Count Two of the Indictment : (a) The nature of and manner in whieh the corre rations “were in faet affiliated with each other’: (b) The nature and kind of “financial and organic tional connections ‘and operations” said Corporation el] had “with each other, and (ec) Wherein such corporations were not Ths business concerns, as established by Taw, rules 3 regulations of the Small Business Administration. eas WO cs Defendants’ motions are new before the Court for deter: mination under the Loeal Rules of this Conoet. That the prosecution here is under the general rand Statute [TS UL S.C. 2 10D} when the aes allewed are specifically proseribed by Tithe 15, UL S. 61, 7 688) Ga), which provides lighter sanctions, furnishes mo e@romnds for dismissal of the indictment. Ehrieh vo United States, 4Cir., 258 BL 2d 481, 485. The motion to dismiss Count Two of the indietment is averrnled and denied. The allegations of Count Two of the indietment which defendants move to strike as surplusage under Rule 7 cd), Federal Rules of Criminal! Procedure, are relevant to the charge contained in that count of the indietment and are not subject to be strieken as surplusage, Uinited States v. Klein (D.C) NL Y.), 124 F.Supp. 4708, The motion to strike is overruled and denied. The information sought by the motion for a bill of particulars, or the means of ascertaining same, appears to he in possession of, or available te the defendants. The indietment is sufficiently definite to advise the de- tendants of the specifie acts with which they are acensed, The motion for a bill of particulars is overruled ane denied, This the 26th day of August, 195s. Bovd Sloan, United States District Judge. — 20 — APPENDIX II. Opinion in Court of Appeals. In the . UNITED STATES COURT OF APPEALS or the Fifth Cireuit. No. . a4). Leonare ob. Sachs. Appel VOTSTES United States of Amertea, Aye jet Aypeal fron the United States Distriet Comm te Northern Distriet of (ieorgia. (August 24, 1961) Berore Pteheson, Rives and Wisdom, Cirenit prides one Wiliam Sachs, whe is net a party te this apy Me indieteg im two counts for violation of TS U.S. &.. hOUL. for making and presenting to the United States 4. Fores and the Small Business Administration certian bu * 7 Loe and traudnient documents and statements, Uremig tad evidence Was disuflicient fo suppor the conviction, Se points fo the fact that. while the statements and dloeumie’s were furnished with his authority and some of thet We his own hand, there is 1e direet evidenee that be | their contents were fraudulent, and. therefore, the exiden is ineuflierent to support the convietion. an The United States, pointing to the tact thane detenad witappellant controlled the four corporations imvoived, tie Fulton Trousce Company, Bederal ‘Sportswear. bine. Wall Manufacturing Conipanuy, and tlenry Garment €onm pany, thet the books ot ali of them were kept oat 225 Cen Trai Avenue, Atlanta, Georgia, where the headquarters of Filton Trouser Company were located: and that, by fetter dated: Mareh 27, 154, signed bw Sachs as President, the aluner sheet, im question, of Fulton as ot February 2s, Chd and a statement of income, prot and loss for the pe nod Jannary t, to February 28. 1954. were transmitted to tie Tnited States Atr Force in couneetion with the pre urement of a certain coutraet bs Fubtou Ver tive ganz hachire ot tlving suits for the Ade Porees insists that thie crretustanee ss dn evidence are suffietent te stppert the Hudine of the jury, that Sachs was responsthie for tire ssManece and use of the statements. and that he knew the talsit\ of their contents. We agree with the United States that the taet that the Meures Were tot aetually prepared bx the defendant but bs Mr. Gertz, the company accountant. is met suflieiens To support Siebs* claim that the proof fared to eomvie! nto! the offenses charged. One Orie Dixon. emploved ov Suehs as general clerk or seeretarsy of Fudan in Pods avd with hime trom that time thronen Td. was a bese oi charge of the offiee. ler duties having inereased. Sie Wis in charge of the staff emoplovees in the office and. had charge of the books of the four corporations. all of whieh Were controled by the appellant. Tt owas Omite Dixon wire Prenaree! the Mareh 27, L054 letter sree be Leonard Saehs, atone with the balanee sheet and statement of am rome cattached thereto. She prepared them: amder the Mirection of Leonard Saens., who gave her a peneried come Irom whieh toe prepare the statements. The peneiiled copies Othe balanee sheet and statement of imeome. profit ana loss were made up by Leonard Sachs trom information obtained over the telephone from: Mar. Trwin Geert ot Remillard, Special Agent with the Tuternal Beseui s> ice, testified: that he had occasion to contaet the aoe. Sachs in connection with the affairs of Futon: thats. a statement under oath from: Sachs and also ou him about the affairs of Federal, Weil, and of that Sachs stated to him that he controled aud far wll the policies of the four corporations. The appellant also stated to Reniullard that? performed by the accountant firm: of Gutt: [ynisuty cated Ge? Wis auditing the beoks: and that this firms wonid. Atlanta and andit the books: and further statedd: (oh ws that is about all they would de”. | With the testimony standing thus and the falsity eo - statements quite plain, we think it clear that the + Was aiple to support the jury's finding, that Sach- responsible for the issuance of tne statements. that ts knew their contents and knew that the statenient- fale. In addition to dis attack upon the insufficiencs evidence, the appellant assigns error to the overriiing © appellant's motion te dismiss Count two of the imebetrs and. ia the alternative, to strike, surplusage tied and. turther in the alternative, for a Tall of parties As to these Claims of error, we think it polain thee? dictmments were not subject to the attacks uper tiie that there is no sound basis for the claim that mower to deny the motien for a bul of particulars. 7 within the discretion of the court to grant or ddetve i In addition to these assignments, appellant are strovgly that it was error for the court to refuse Toast! plaintiff’. requested instructions Nos. 4 and 9, which eflect instructed the jury as to: the effeet which foe . , ie Bare | és". given to the acts of these in charge of Georgia cory The charges Were properly refused. the evidenee was all before the Jury. and the judge’s general charge correctly sibmatted To the jury the assues tor their determination. The refusal of the charges of whieh appellatt: comyplatis Was beterper On the contrary. ait would have been error tose them beenuse. distead of leaving te the jury the de rhohation of the faets uuder @emerai austructions. i would have had the etfeet of coutrofiing and directing the rh . consideration of the evidernedy The Hatters in VANAN SS tioty based tee elas wath corporate aets, the responsibility weder the evidence of the defendant therefor. and umeder ane evden, which Weis suiftietent Te Conviet, thas eS. Tat Hie qury’s detertnimation. Neoreversible error appearing. the idenient is Adivnrees!, A true COPY Test: Rdward Wo Wadsworth. €lerk, US. Court of Agpeals. Fifth Cireuit, By Gilbert Foo Gauinebean, iSeal) OS re New Orleans, Louisiana et, DY 1961 Judgment. Extract from the Minutes of Nuenst 24. 1907. Leonard oJ. Sachs. No. S575 versus United States of Amerien. This canse caine on te be heard on the transeript of the meord from the United States District Court for the North. ern District of Georgia, and was argued by counsel: scien I ce On Consideration Whereot, it is now here erdercd . adjudged by this Court that the judgment of the sare Ty. trict Court im this eause be. and the same ie her affirmed. —_— Tn the United States Court of Appeni- For the Fifth Cireuit. No. 18570. Leonard J. Sachs. Appellant, Vs. United States of America, Appellee. Appeal from the United States Distriet) Cor for the Northern Distriet of Georgia, ae (September 22, 1961.) On Petition for Rehearing. Jofore Huteheson. Rives and Wisdom, Cireuit: Judges. Per Curiam: It is Ordered that the petition for rehearing 1 above entitled and numbered eause. be, and tt ts here’? Dented. APPENDIX III. Analysis of Balance Sheet Items of Fulton Trouser Company as of February 28, 1954. Pyaadiarness } Det ‘ Sheet Shooet ~-2S-94 Ther, ~ }) ferences ASSTTS drat hs $ 16 N54 Rt 2442) the x fi Sten Receivable oo. ai TEN a A ret $683.72 : : . as W]e “NS od .* Recevabte Employer = HW Sepsscch a é Fixtures -Auto & Trucks- Net... He SPL ie eee a! Ofer Ee a 2 ES ot) vanee Tnexpired |. Payor hexee t ee \ 4h sar? Tmprovements-Unamortized. Ra ee Po SOs 4 Teta! Assets PIVG DEG LNG PAT se brine os ABILITIES, CAPITAL & SURPLUS BIS CPRVAIEY 68 cu ¥ TUATSLIN TB SR ter ss Se NO aaah Tlet EXpemses rat ees ; Piatyel eae ee Beis ee ae Py ak ee 7 &@ Company —~ Mortguge Se Tah ers Ginsbers Machine Co. Eis Py Pes) PAGROIO. oho yw. ae 2h ASI TS AA ints Payable Henry Garment Co arenes, os T7049 Mait Pavable- Federal Sportswear. Ine, 16.85.35 Tey sansa Security Taxes... . Ph ik ee ‘ Wiis “poMnent Insurance oy (304 hnelding Taxes eels Teed Cn Sa hota? Liabilitie. HQ A As S236, 5510 mate Uast a ‘ta! and Surolus: heh Stocks Sl Shares Ne Par Common, 3 35.600 00 € 250000) eT a] Sto K Preferred tr eecte teed Seb chante tras "Sed Survhis— Defiedt (14.2063 (bf 2G 3 Sts for Period. .. 2b S125 Re we pee $e at Peta Capital & Surplus. . 8 OL70595 FOS AT se Ses rLee ‘te Me Eavdtities. Capital & Surptas ENG 18 55 F265 Lad Ne 4) - Analysis of Income & Expense Items of Fulton Trouser Compiz as of February 28, 1954. _ Ahaihscs Stutemeit ae of Tmeome Pt Paé&l. yor q Sales . F2L3BK.189 52 gy Cost of Goods So!d: Inventory 11-54 . 2. 8 84.63-..92 £ aGens Purchases Net : 40 se 5t 4p vines Ts | Pavrell fT eae Cor | Payrell Tunxes G ys Ga “4 Totals : 93 $205,414 42 ee Se | Less Inventory 2-28-54 QP KONSS aie Cost of Goods Sald S15EST0SS FPS ats ‘ Gross Profit FOHAGTS NS $ 4! General & Administrative Experses FH Noo es c Tp Rent. .... oo ee We COND Ue Machine Repairs 537.64 freee Interest .. +5 Obs ; Taxes—Gerneril HT es Charity be anes Depreciation Ke OC PL > Advertising 3 \% Nn a, : ; Ho} : ‘TrOCKINE. a Charess to Wii Manufiectarin (rn. and Te Federal Sportswear for Factors “¢ harges ee Charees te Will Manufieturing Co. and Federal Sportswear for Cutting and ter Office Expetises eT Total Misceilaneous Income be ae cae Pront for Per1od Ge P.210.95, Ca an --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386420_1306%3A2. Public record. Not legal advice.