UNITED STATES v. JOHNPOLL No. 896, Docket 83-1335.
739 F.2d 702 (1984)
UNITED STATES of America, Appellee, v. Harvey JOHNPOLL, Defendant-Appellant.
United States Court of Appeals, Second Circuit.
Decided June 18, 1984.
Rudolph W. Giuliani, U.S. Atty., for the S.D.N.Y., New York City (Patricia Anne Williams, Paul L. Shechtman, Asst. U.S. Attys., New York City, of counsel), for appellee.
Before MANSFIELD, NEWMAN and PRATT, Circuit Judges.
MANSFIELD, Circuit Judge.
Harvey Johnpoll appeals from a judgment of conviction entered in the Southern District of New York by Judge Robert L. Carter on September 20, 1983, following a jury verdict finding him guilty of one count of conspiring to transport stolen securities and the proceeds from the sale of those securities in foreign commerce in violation of 18 U.S.C. § 371
Johnpoll argues that the district court erred in (1) admitting into evidence the
Except for the last of these contentions, we find no merit in Johnpoll's various arguments. Accordingly, we affirm his conviction on the conspiracy count (Count One) and the three counts of transporting stolen securities in foreign commerce (Counts Three through Five). We dismiss the other three counts charging unlawful transportation of the proceeds from the sale of the securities (Counts Ten through Twelve) and remand for resentencing in accord with our decision.
The record, viewed as it must be in the light most favorable to the government, Glasser v. United States,
Meanwhile, in July 1980, one Alexandra Kacenelenbogen contacted Remy Pfenniger, the president of Gestofinance, a Swiss import-export company, and offered to sell him $400,000 in American securities. Kacenelenbogen told Pfenniger that she was acting on behalf of Harvey Johnpoll, an American businessman who represented certain Italian planters. Pfenniger, who had a prior Swiss conviction for receiving stolen securities, feared that the securities might be stolen and declined the offer. Kacenelenbogen then took the securities to Gestofinance's Geneva offices, where she repeated the proposition to Jean Claude Genoud-Prachex, who worked for Pfenniger. Genoud-Prachex telephoned Johnpoll in New York; Johnpoll assured him that the securities were not stolen, explaining that he wanted to sell them through a Swiss company in order to avoid United States taxes. Following this conversation, Genoud-Prachex checked and determined that the securities had not been reported stolen and subsequently encouraged Pfenniger to pursue the deal. Pfenniger, still hesitant, telephoned Johnpoll and questioned him as to why he was not selling the securities through a bank. Johnpoll replied that he was fearful that a Swiss bank would report the sale. He offered Pfenniger 10% of the sale price if Gestofinance would serve as the intermediary and noted that he had an additional $6,000,000 in securities to sell through Pfenniger's company.
On July 11, 1980, Pfenniger went to the Geneva office of Merrill Lynch, Pierce, Fenner & Smith ("Merrill Lynch"), taking the securities that Kacenelenbogen had left with Genoud-Prachex. He opened an account in the name of Gestofinance, requesting Merrill Lynch to determine whether the securities had been reported stolen and, if not, to resell them immediately. That day, Merrill Lynch sold the securities for a net
Four days later, on July 15, 1980, Pfenniger transferred by wire $25,000 from Gestofinance's Swiss account to European-American Bank in Brooklyn for the account of Prieto International, Inc. ("Prieto"), a company wholly owned by Johnpoll. Five days later, Pfenniger and Kacenelenbogen flew to New York to meet with Johnpoll. Johnpoll reiterated that the securities belonged to Italian planters who wished to sell them through a Swiss intermediary in order to avoid taxes. Johnpoll and Pfenniger agreed that Pfenniger would receive a 2% commission on future sales. It was also agreed that future deliveries would be made by courier and that the courier would meet Pfenniger at the La Coupole cafe across the street from Merrill Lynch's Geneva office. Before leaving New York, Pfenniger gave Johnpoll $293,000 cash as part of the proceeds on the initial sale.
Upon returning to Geneva, Pfenniger informed Susannah Maas, his attorney, about his negotiations with Johnpoll. Pfenniger asked Maas to assist them in avoiding Swiss taxes on the securities sales. Maas in turn set up a Liechtenstein corporation, Groclamare Anstalt ("Groclamare"), and opened an account at Merrill Lynch in Groclamare's name. Thereafter, on three separate occasions — July 31, August 14, and August 15 — Johnpoll notified Pfenniger by telephone that a shipment of securities would be arriving in Geneva. All three deliveries were made at the La Coupole cafe by courier: $1,446,397 in securities on July 31; $1,813,759 in securities on August 14; and $2,364,247 in securities on August 15. Those three deliveries formed the basis of Counts Three through Five. On the occasion of each delivery, Pfenniger gave the securities to Maas who in turn deposited them in Groclamare's account at Merrill Lynch for sale. All of the securities were from the SSC theft. As soon as Merrill Lynch would sell the securities, Maas and Genoud-Prachex would withdraw the proceeds and deposit them into one of three Swiss bank accounts opened by Maas for the purpose of holding the money. Within a day of the deposit, Maas and Genoud would withdraw the funds in cash. By August 26, they had deposited and withdrawn $4,500,000 in cash from these three bank accounts.
After the first courier delivery, Johnpoll flew to Geneva and took a room at a hotel. Shortly thereafter, Pfenniger and Genoud-Prachex brought Johnpoll $725,000 in cash that had been withdrawn by Maas and Genoud-Prachex from the Swiss bank accounts. At Johnpoll's direction, on August 8, Pfenniger transferred another $192,450 to three American bank accounts: $72,170 to Prieto's account at European-American Bank; $86,610 to Johnpoll's Fine Art to the Consumer ("FATTC") account at the same bank; and $33,670 to the "Coming Generation American Musical Theatre Corporation" account at Chemical Bank. The $86,610 transfer to Prieto's account formed the basis of Count Ten of the indictment. At the same time, Johnpoll deposited $50,000 into yet another Swiss bank account in the name of Cavar Anstalt, a shell corporation that Maas had created at Johnpoll's request. Later that day (August 8), Johnpoll returned to New York with Maas; at customs, Maas declared that she was bringing $350,000 in cash into the country. Once through customs, she gave the cash to Johnpoll.
On August 15, after the sale of more stolen securities, Johnpoll telephoned Pfenniger with instructions to transmit a portion of the proceeds to New York. Pfenniger then transferred $73,159 to FATTC's account and $121,946 to Prieto's account. Those two transfers formed the basis of Counts Eleven and Twelve of the indictment respectively. Late that evening Johnpoll flew from New York to Geneva to collect the remaining monies from the sales. Back in Switzerland, Johnpoll travelled on August 18 to Bank Hapoalim in Zurich, where he had previously opened
In the meantime, Merrill Lynch received information indicating that SSC's securities had been stolen. It immediately froze Groclamare's account. On September 5, Pfenniger informed Johnpoll of Merrill Lynch's action and told him that if the securities were stolen Pfenniger would go to the police. Within 24 hours of their conversation, Johnpoll fled Switzerland for the United States. Thereafter, on September 18, Johnpoll's wife telephoned the Bank Hapoalim and instructed it to wire $750,018 to an "Idea Development" account at Chemical Bank.
Two-and-a-half years later, on February 18, 1983, Johnpoll was indicted. On April 28, 1983, the government moved the district court, pursuant to Fed.R.Crim.P. 15,
At a May 3 conference Judge Carter requested the government to negotiate with the witnesses in order to reduce their demands. This proved troublesome, as the government was not allowed to communicate directly with the Swiss witnesses and the Swiss Central Authority refused to ask the witnesses to reduce their demands. On May 6, the government reported to Judge Carter that it had been unable to persuade the witnesses to reduce their demands. Accordingly, Judge Carter authorized the depositions.
At the May 6 conference the government reminded Judge Carter that there was an outstanding Swiss warrant for Johnpoll's arrest dating from 1980. The government expressed the willingness to make arrangements for a simultaneous telephone hookup so that Johnpoll could hear the proceedings and advise his counsel.
On May 27, before leaving for the airport, the Assistant U.S. Attorney in charge of the case telephoned Johnpoll's attorney, Edward Rudofsky, and left a message to the effect that the Swiss magistrates in charge of the scheduled depositions had finally agreed to allow full cross-examination. Earlier, those magistrates had indicated that all questions must be submitted in advance. The prosecutor also noted that arrangements had been made to permit a telephone hook-up so that Johnpoll could listen to the depositions. The prosecutor left for Switzerland at the appointed time but Rudofsky did not. Instead, Rudofsky delivered a letter to the U.S. Attorney's Office stating that he would not attend the depositions and that Johnpoll would be represented by a Swiss attorney for the purpose of raising objections to the proceedings.
In Switzerland, the government deposed Pfenniger, Genoud-Prachex, Maas, Farloff, and Rene Gambazzi, a police officer whose deposition had been unscheduled. Johnpoll did not listen to the depositions through a telephone hook-up since both of his Swiss attorneys declined to participate in the depositions other than to state their opposition to the proceedings. Neither attorney cross-examined the deponents, although the magistrate had indicated his willingness to allow such examination.
When the Assistant U.S. Attorney returned to the United States with the depositions, Judge Carter examined them, heard Johnpoll's objections, excised those portions that were prejudicial or irrelevant, and determined that the rest of the deposition testimony was admissible evidence. The depositions were admitted into evidence at Johnpoll's trial.
Trial commenced on July 11, 1983. On July 20, 1983, the jury found Johnpoll guilty of conspiring to transport stolen securities and proceeds from the sale of those securities in foreign commerce (Count One) and of actual transportation of stolen securities or their proceeds on six separate occasions (Counts Three through Five and Ten through Twelve).
The Swiss Deposition Testimony
Johnpoll argues that the taking of the Swiss depositions for use at trial violated Fed.R.Crim.P. 15 which permits such depositions only in "exceptional circumstances" and "in the interest of justice." He contends that the requisite exceptional circumstances did not exist and that the admission into evidence of the depositions taken in Switzerland of the five witnesses violated his Sixth Amendment confrontation rights. We disagree.
The decision to grant or deny a motion to take a deposition rests within the sound discretion of the trial court, United States v. Hayutin,
In the present case the foregoing standards were met. The testimony of the Swiss witnesses was clearly material since they had dealt extensively with Johnpoll in his making of arrangements for transporting the stolen securities and secreting the proceeds from their sale. Indeed, it is unlikely that Johnpoll could have been convicted without their testimony.
Moreover, the surrounding circumstances satisfy us that the witnesses could not be said to be personally available for trial within the meaning of Rule 15. In the first place, being Swiss nationals in Switzerland, they were not amenable to service of United States process, either by statute or treaty.
In our view the government's refusal to accede to their demands (after the Assistant U.S. Attorney on the case unsuccessfully sought authority from the Attorney General) was not unreasonable. It is readily apparent that in the absence of extraordinary circumstances (not present here), even assuming the government had funds to meet the witnesses' demands, its submission to these conditions would establish a precedent that could have extensive harmful repercussions. If it were required to yield to such demands before being permitted to avail itself of Rule 15, it might then be forced in the future to submit to potentially unlimited pressure from foreign witnesses (requesting much higher levels of compensation), which might justify criticism that their testimony was being "bought." The reasonableness of the government's position is further supported by the precautions imposed by the deposition procedure prescribed by Rule 15, subsection (c) of which authorizes the court, when a defendant is unable to bear the expenses of the taking of the deposition, to direct the government to pay "the expense of travel and subsistence of the defendant
Johnpoll argues that the government's refusal to meet the foreign witnesses' demands was nevertheless unreasonable because 28 U.S.C. § 524(a)(1) makes appropriations available to the Attorney General "for payment of ... compensation and expenses of witnesses and informants, all at the rates authorized or approved by the Attorney General" and that the government in the past has pursuant to § 524(a)(1) expended thousands of dollars for witnesses in protective custody because of death threats. See, e.g., United States v. Librach,
Johnpoll's claim that admission of the deposition testimony violated his confrontation rights must likewise be rejected. The Confrontation Clause does not preclude admission of prior testimony of an unavailable witness, Mattox v. United States,
The Response to the Jury's Inquiries
Johnpoll next argues that the district court failed to comply with the dictates of United States v. Ronder,
The jury in this case commenced its deliberations at 1:03 P.M. on July 19, 1983. At 2:30 P.M. it sent out its first note, which requested certain exhibits that were then transmitted to it by agreement of counsel. Thereafter, at approximately 3:50 P.M., the court received a second note from the jurors asking whether "the object of the conspiracy stated in the indictment [is] inherent in the conspiracy charge [i.e.] do we follow the indictment verbatim." Judge Carter sua sponte sent the note back to the jury, asking for a clarification. Subsequently Judge Carter read the note into the record and advised the parties of the action he had taken. They conceded that they did not understand the question either. Neither party objected to his request for a clarification. Since the judge's response to the jury was not substantive, the failure to conform literally to the requirements of Ronder was harmless.
At 4:35 P.M. the jury submitted its third note to the court, which inquired whether "the defendant [must] know beyond reasonable doubt that the securities were stolen" and whether "on count I ... the jury has to agree on the object of the conspiracy stated on page 1, paragraph 2, of the indictment." Judge Carter promptly read this note into the record and asked the parties whether they had any views on how he should respond. Having sought and received suggestions from the parties, Judge Carter recalled the jury. At the outset, Judge Carter told the jury that he assumed the second note was a clarification of the first note. No juror disputed that assessment. He then re-read his charge on the elements of a § 2314 offense as well as the charge on willfulness and knowledge. Turning to the second part of the jury's note, Judge Carter informed the jury that it need find only one of the objects of the conspiracy, not both, to support a conspiracy conviction.
At 5:27 P.M. the jury sent out its fourth note requesting certain charts that had been admitted into evidence during trial. In accordance with the requirements of Ronder, Judge Carter showed the note to the parties and requested their views. After considering those responses he sent the charts into the jury, with supporting exhibits.
The jury's final note was received the next morning at 11:35 A.M. Once again Judge Carter read the note into the record, discussed proposed responses to the note with the parties, and recalled the jury and instructed them accordingly. Thus, Judge Carter substantially complied with the requirements of Ronder and any slight deviations were harmless.
The Jury Instruction Regarding Possession of Recently Stolen Property
Section 2314 of Title 18 requires that the defendant "know" that the securities have been stolen. Judge Carter charged the jury:
Johnpoll argues that this instruction failed to define the word "recently" and that by failing to make clear that possession may be satisfactorily explained through other circumstances it shifted to Johnpoll the burden of explaining his possession of the stolen securities. Putting aside his waiver of the objection by failure to raise it below, United States v. Praetorious,
The word "recently" is neither outside common understanding nor so technical or ambiguous as to require specific definition. United States v. Crockett,
Nor did Judge Carter's charge impermissibly shift to Johnpoll the burden of proving lack of guilty knowledge. To be sure, as the Supreme Court stated in Barnes v. United States,
In the present case the inference of knowledge drawn by the jury satisfied the "reasonable-doubt standard," particularly in view of Judge Carter's instruction that the inference was permissible, not mandatory, and that no adverse inference could be drawn from Johnpoll's decision not to testify.
Sufficiency of the Evidence that the Securities were Stolen
Johnpoll argues that the evidence was insufficient as a matter of law to prove that the securities were in fact stolen from SSC. An appellant challenging the sufficiency of the evidence bears "a very heavy burden." United States v. Losada,
The evidence established that the securities in SSC's "sealed [and] secured" vault, into which entry could be gained only by a magnetically coded card, were closely monitored and documented. After the loss was discovered, an extensive audit determined that the securities had not left the vault in the normal course of SSC's business and that false entries had been made in SSC's
Compliance With the Speedy Trial Act
The Speedy Trial Act, 18 U.S.C. §§ 3161,
Between the date of arraignment, when the speedy trial clock began to run, and the time of trial, there were three periods of excusable delay which tolled the speedy trial time period. First, the period between March 4 and March 22, during which time Johnpoll's pretrial motions were under consideration by the court, was automatically excludable under 18 U.S.C. § 3161(h)(1)(F); this 18-day period was reasonably required for that purpose. For the same reason the period from April 28, when the government moved for authorization to depose the Swiss witnesses, until May 6, when the court granted that motion, was automatically excludable. Third, the periods from April 26 to May 19 and from May 26 to May 27, when Johnpoll pursued interlocutory appeals to this court, were properly excluded in accord with 18 U.S.C. § 3161(h)(1)(E).
Taking into account these proper exclusions, the speedy trial date was extended until June 20, the date set by Judge Carter for trial. However, prior to that date Johnpoll filed with the Central Authority in Bern formal opposition to the Swiss depositions and the Swiss authorities agreed to retain all of the depositions until the matter was resolved, thus delaying the arrival of the deposition materials from Switzerland until July 5. At that point, despite Johnpoll's request for "a later date," Judge Carter set trial for July 11. We find that the postponement of trial from June 20 until July 11 was justified by the unavailability of the deposition evidence and that Johnpoll's Speedy Trial Act rights were therefore not abridged.
Opportunity to Make Pretrial Motions and Engage in Discovery
Johnpoll's claim that he was denied the opportunity to make pretrial motions is
Claim of Violation of the Treaty With Switzerland
In June 1981, pursuant to the treaty for Mutual Assistance in Criminal Matters, May 25, 1973, United States-Switzerland, 27 U.S.T. 2019, T.I.A.S. 8302, the United States requested the assistance of the Swiss in the investigation of "a group of persons ... who possessed stolen securities worth about nine million U.S. dollars and transported them to Geneva, Switzerland, where they were sold," an offense for which assistance by the Swiss is compulsory. Switzerland honored the request and transmitted documentary evidence to the United States.
When the grand jury returned an indictment charging Johnpoll with customs as well as stolen security offenses, the government told the court that in accord with the Treaty, which does not require assistance regarding investigations concerning "violations with respect to ... customs duties", 27 U.S.T. at 2027, the Swiss documents "should not be considered by the [trial] jury in connection with [the customs] counts" and suggested an appropriate limiting instruction.
Johnpoll argues that the evidence received from Switzerland should be suppressed because it was fraudulently obtained on the government's representation that it was for use in prosecution of security theft violations covered by the Treaty whereas the grand jury also indicted him for customs violations, which were not so covered. We disagree.
As long as the evidence was used to prosecute violations covered by the Treaty, the government was not precluded from also prosecuting other related non-treaty offenses, particularly in view of its consent to an appropriate instruction limiting the use of the evidence. Moreover, Article 37(a) of the Treaty expressly bars Johnpoll from gaining the right thereunder to suppress or exclude evidence of the type furnished in this case. See 27 U.S.T. at 2056. In any event the matter has been mooted by the district court's dismissal at the close of the government's case of the non-treaty customs offenses (Counts Six through Nine).
The Multiplicitous Indictment Claim
Johnpoll contends that the various alleged acts of transporting stolen securities and the proceeds thereof give rise to but a single offense and that the seven substantive counts of the indictment should have been reduced to a single count. In the alternative, he argues that the transportation of the proceeds from the conversion of the stolen securities cannot be differentiated from the transportation of the securities themselves and that therefore Counts Ten through Twelve should be dismissed.
Under 18 U.S.C. § 2314 each interstate or foreign transportation of stolen securities constitutes a separate violation of § 2314, even if the various acts of transportation are part of a single scheme. United States v. Gotches,
Separate prosecution of the transportation of "proceeds" of stolen securities, as distinguished from transportation of the securities themselves, however, presents a more difficult question, the answer to which depends on (1) whether "proceeds"
The question of whether each of the transmittals of proceeds from Switzerland to New York charged in Counts Ten through Twelve may be treated as a separate unit of prosecution under § 2314 turns on whether it constituted solely a continuation of a transportation alleged in Counts Three, Four or Five, or represented a separate additional transportation of a portion of the proceeds from the sale of that property. If it was the former, it could not properly be charged as a separate crime since this would permit fragmentation of one continuous transportation into several segments, opening the door to mischievous abuse of the statute.
If, on the other hand, proceeds were divided into two or more separate portions, each of which was then separately transported, the interstate or foreign transportation of each additional lot would amount to a separate violation of § 2314. United States v. Gotches, supra; United States v. Flick, supra. However, the indictment in the present case fails to allege whether any of the transportations alleged in Counts Ten through Twelve were separate transmittals of additional portions of any of those charged in Counts Three through Five and this issue was not presented to the jury for resolution. Accordingly we conclude in accordance with the rule of lenity that Counts Ten through Twelve must be treated as duplicative and dismissed as multiplicitous.
The judgment of conviction of Counts One, Three, Four and Five of the indictment is affirmed. The judgment of conviction of Counts Ten through Twelve is reversed and the case is remanded for dismissal of the latter counts and resentencing.
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