Source: https://law.justia.com/cases/federal/appellate-courts/F2/383/610/429388/
Timestamp: 2020-07-13 12:34:05
Document Index: 91832391

Matched Legal Cases: ['§ 152', '§ 701', '§ 742', '§ 110', '§ 183', '§ 41']

United States of America, Appellee, v. C. Parke Masterson, Defendant-appellant, 383 F.2d 610 (2d Cir. 1967) :: Justia
Justia › US Law › Case Law › Federal Courts › Courts of Appeals › Second Circuit › 1967 › United States of America, Appellee, v. C. Parke Masterson, Defendant-appellant
United States of America, Appellee, v. C. Parke Masterson, Defendant-appellant, 383 F.2d 610 (2d Cir. 1967)
US Court of Appeals for the Second Circuit - 383 F.2d 610 (2d Cir. 1967) Argued May 18, 1967
Richard A. Givens, Asst. U. S. Atty. (Robert M. Morgenthau, U. S. Atty., for the Southern District of New York, New York City, Michael W. Mitchell, Asst. U. S. Atty., on the brief), for appellee.
Appellant was convicted of falsifying or causing to be falsified certain invoices and of making or causing to be made certain false accounts in relation to the bankruptcy proceedings of Twin Lock, Inc. in violation of 18 U.S.C. §§ 152, 2.1 The major issues on appeal concern the sufficiency of the evidence and whether the invoices in question should have been excluded from evidence as a product of an illegal search and seizure.
Appellant, a lawyer, was the president of Twin Lock until shortly before January 19, 1961, when Twin Lock filed a voluntary petition in bankruptcy pursuant to Chapter 11 of the Bankruptcy Act. 11 U.S.C. § 701 et seq. Appellant's association with Twin Lock did not terminate with his resignation of the presidency, however, as he continued to render legal services to the corporation. Subsequent to the filing of the petition, the Bankruptcy Court permitted Twin Lock to be operated by debtors in possession, see 11 U.S.C. § 742, but required the posting of bonds to secure creditors. Debtor-in-possession financial statements were required to be submitted to the Referee in Bankruptcy periodically. On December 24, 1963, the corporation was adjudged a bankrupt and the debtor-in-possession period was ended.
We now turn to appellant's search and seizure claim. Twin Lock had apparently opened its office at 10 Columbus Circle, New York City, in 1958 — at that time appellant had his law office elsewhere — but in 1961 appellant took over the lease in toto for use as his law office. Twin Lock was permitted, however, to use a desk and some filing cabinets in the outer room of the suite, although it contributed no rent. Mrs. Mayer and a Twin Lock salesman used this space regularly as did one Joseph Lavorata, Twin Lock's managing agent during the debtor-in-possession period. The corporate records were kept in the filing cabinets.
On January 9, 1964, after Twin Lock had been adjudged a bankrupt, an associate of the Trustee in Bankruptcy together with Mr. Zarett, representing the Referee, entered the premises and took the corporate records against appellant's wishes.2 Prior to the trial, appellant moved to suppress the invoices — seized as part of the records — on the grounds that the Trustee's representative had trespassed on appellant's premises, making the invoices a product of an illegal search and seizure in violation of appellant's Fourth Amendment rights. Judge Cannella denied the motion on the ground that even if the records had been illegally seized, they should not be suppressed in a criminal trial as the Trustee is not a law enforcement agent. At trial, when appellant objected to the introduction of the invoices in evidence, the trial court, after hearing testimony in the absence of the jury concerning the circumstances of the taking of the records, followed Judge Cannella's ruling and allowed the invoices into evidence.
We believe that both judges properly admitted the invoices into evidence. However, we do not reach the question of whether the records, which were found by the district court to be illegally seized by representatives of the Trustee in Bankruptcy are excludable in a criminal trial, because we find that appellant, under the circumstances of this case, has not discharged his burden of persuading the court below that he has standing to challenge the legality of this seizure. Both judges below who passed upon this question assumed that since the records were seized from appellant's premises he is a person "aggrieved" by the search, even though the records were corporate property. To qualify as an "aggrieved person" within Rule 41(e), one must be a "victim" of the search or seizure, "one against whom the search was directed, as distinguished from one who claims prejudice only through the use of evidence gathered as a consequence of a search or seizure directed at someone else." The purpose of the rule is to protect against invasion of privacy and the security of property Jones v. United States, 362 U.S. 257, 261, 80 S. Ct. 725, 731, 4 L. Ed. 2d 697 (1960). See United States ex rel. DeForte v. Mancusi, 379 F.2d 897 (2 Cir. June 28, 1967). The appellant failed to show either that the search was directed against him or that it invaded the security of his property.
It is clear that the purpose of the seizure of the records was to enable the Trustee to ascertain the financial position of the bankrupt, Twin Lock. We cannot say that the search was for the purpose of obtaining evidence for use against appellant, when the record shows that prior to examination of these records no criminal proceedings had been commenced and there is no showing that such proceedings were contemplated by the Trustee. Therefore this case is unlike United States v. Birrell, 242 F. Supp. 191 (1965).
Nor was the security of appellant's property or his right to privacy in any way threatened or impaired. It is undisputed that the seized materials were the property of the bankrupt and that the Trustee was entitled to their possession. 11 U.S.C. § 110. While the court below found that the Trustee's representatives committed a trespass in entering appellant's office to remove the records, appellant was at most a bailee with respect to Twin Lock's records. A bailor is privileged peacefully to go upon the property of a bailee in order to recover possession of his property. 1 Restatement of Torts, Second § 183. The Trustee's representatives did no more than a private person could lawfully do under similar circumstances. It cannot be said that the security of appellant's property was disturbed by an action which any private person similarly situated could lawfully have undertaken.
On a motion to suppress under Rule 41(e) of the Federal Rules of Criminal Procedure, the burden is on the defendant to prove all facts necessary to sustain the motion. Murray v. United States, 333 F.2d 409 (10 Cir. 1964), vacated on other grounds, 380 U.S. 527, 85 S. Ct. 1345, 14 L. Ed. 2d 266 (1965); United States v. Poppitt, 227 F. Supp. 73 (D. Del. 1964); 5 Orfield, Criminal Procedure Under the Federal Rules § 41.54 (1967). Appellant has failed to show facts sufficient to give him standing to challenge admission of the invoices. Therefore it was proper to admit them at trial.
"Whoever, after the filing of a bankruptcy proceeding or in contemplation thereof, knowingly and fraudulently * * * falsifies, or makes a false entry in any document affecting or relating to the property or affairs of a bankrupt * * *