Source: https://case-law.vlex.com/vid/662-f-2d-162-594817730
Timestamp: 2020-08-12 10:22:43
Document Index: 570115936

Matched Legal Cases: ['§ 371', '§ 1341', '§ 1342', '§ 1503', '§ 1623', '§ 455', '§ 144']

662 F.2d 162 (2nd Cir. 1981), 127-129, United States v. Coven - Federal Cases - Case Law - VLEX 594817730
Docket Nº: 127-129, Dockets 81-1106, 81-1120, 81-1122.
Party Name: UNITED STATES of America, Plaintiff-Appellee, v. Bernard J. COVEN and James F. O'Connor, Defendants-Appellants.
662 F.2d 162 (2nd Cir. 1981)
Before OAKES and MESKILL, Circuit Judges, and BLUMENFELD, District Judge. [*]
James F. O'Connor and Bernard J. Coven appeal from judgments of the United States District Court for the Southern District of New York, Carter, J., entered after a trial by jury convicting each of one count of conspiracy, 18 U.S.C. § 371 (1976); eight counts of mail fraud, 18 U.S.C. §§ 1341-42 (1976); one count of wire fraud, 18 U.S.C. §§ 1342-43 (1976); and one count of obstruction of justice, 18 U.S.C. § 1503 (Supp. III 1979). In addition, Coven was convicted of one count, and O'Connor of two counts of false declaration, 18 U.S.C. § 1623 (1976 & Supp. III 1979). The district court sentenced both appellants to ten years imprisonment 1 and imposed the maximum committed
fine as to each count, totalling $34,000 as to Coven and $44,000 as to O'Connor. We affirm.
Morgan Harris & Scott, Ltd. ("MHS"), and later, Harrison Prescott, Inc. ("HP") were major customers of Euro-Swiss. These companies, both owned and operated by one Earl Wilt, were so-called "boiler room" operations which used high pressure telephone sales and other tactics to induce the public to purchase contracts for the deferred delivery of commodities. 2 MHS and HP "covered" these "retail" contracts by purchasing similar "wholesale" contracts from Euro-Swiss.
Appellants strenuously argue that the civil attachment proceeding, out of which some of the criminal charges and some of the evidence presented in the criminal trial grew, was invalid due to Judge Motley's failure to recuse herself under 28 U.S.C. § 455. 3 This invalidity, they contend, tainted the subsequent criminal proceedings before Judge Carter. Appellants claim that Judge Motley obtained "personal knowledge of disputed evidentiary facts" and was therefore required to recuse herself from the attachment proceeding. According to appellants, Judge Motley's "pre-knowledge" of evidence relating to facts disputed in the proceeding created a situation in which her "impartiality might reasonably be questioned." This allegedly disqualifying "pre-knowledge" was obtained when Assistant United States Attorney Audrey Strauss, who subsequently prosecuted the criminal case, approached Judge Motley asking that Glusband, the receiver, be permitted to cooperate in a criminal investigation of Coven and O'Connor. Strauss told Judge Motley that Earl Wilt, while cooperating with the government, had obtained evidence that Coven and O'Connor had attempted to defraud the receiver by showing him records of fictitious orders from MHS to Euro-Swiss for which MHS had not paid, and by producing a fraudulent, backdated customer agreement between MHS and Euro-Swiss. These documents, if genuine, would have demonstrated that Euro-Swiss did not owe money to MHS under the maturing contracts. Judge Motley permitted Glusband to report to the government on any meetings with Coven and O'Connor in the course of his duties as receiver, but warned that Glusband should inform the court of any conflict that might develop between his duties as receiver and his cooperation with the criminal investigation.
Section 455(b)(1) requires recusal when a judge has "personal knowledge of disputed evidentiary facts concerning the proceeding ...." The term "personal" was carried over from 28 U.S.C. § 144 when section 455 was amended in 1974. Pub.L.No.93-512, 88 Stat. 1609. This amendment to section 455 was intended to make the statutory standards
for judicial disqualification consistent with those set forth in Canon 3C of the ABA Code of Judicial Conduct. See H.R.Rep.No.93-1453, 93d Cong., 2d Sess. (1974), reprinted in (1974) U.S.Code Cong. & Ad.News 6351. The ABA Code was adopted in 1972 in the light of a long line of cases holding that "personal" as used in section 144 means "extrajudicial." Knowledge acquired by the judge while he performs judicial duties does not constitute grounds for disqualification. United States v. Grinnell Corp., 384 U.S. 563, 583, 86 S.Ct. 1698, 1710, 16 L.Ed.2d 778 (1966); United States v. Bernstein, 533 F.2d 775, 785 (2d Cir.), cert. denied, 429 U.S. 998, 97 S.Ct. 523, 50 L.Ed.2d 608 (1976). There is no indication in the ABA Code, the accompanying commentary, or the legislative history of section 455 that this earlier judicial interpretation of "personal" was disapproved. Against this background it is clear that by amending section 455 Congress intended to transfer the extrajudicial bias limitation contained in section 144 to section 455(b)(1). Information or knowledge possessed by a judge must stem from an extrajudicial source to warrant disqualification. In re International Business Machines Corp., 618 F.2d 923, 927-28 (2d Cir. 1980); United States v. Wolfson, 558 F.2d 59, 62-63 (2d Cir. 1977).
In this case, the information in question was obtained by Judge Motley when the government sought her approval of an agreement...