Case Name: UNITED STATES of America, Plaintiff-Appellee, v. Edward J. BARRETT, Defendant-Appellant
Court: United States Court of Appeals for the Seventh Circuit
Jurisdiction: United States
Decision Date: 1974-11-08
Citations: 505 F.2d 1091
Docket Number: No. 73-1477
Parties: UNITED STATES of America, Plaintiff-Appellee, v. Edward J. BARRETT, Defendant-Appellant.
Judges: 
Reporter: Federal Reporter 2d Series
Volume: 505
Pages: 1091–1115

Head Matter:
UNITED STATES of America, Plaintiff-Appellee, v. Edward J. BARRETT, Defendant-Appellant.
No. 73-1477.
United States Court of Appeals, Seventh Circuit.
Argued Jan. 7, 1974.
Decided Nov. 8, 1974.
Rehearing En Banc Denied Dec. 26, 1974.
Rehearing Denied Jan. 2, 1975.
Robert E. Wiss and Thomas A. Foran, Chicago, III., for defendant-appellant.
James R. Thompson, U. S. Atty., Gary L. Starkman and Dan K. Webb, Asst. U. S. Attys., Chicago, 111., for plaintiff-ap-pellee.
Before HASTINGS, Senior Circuit Judge, and STEVENS and SPRECHER, Circuit Judges.

Opinion:
SPRECHER, Circuit Judge.
This appeal seeks review of the conviction of Edward Barrett, the County Clerk of Cook County, Illinois, from 1955 to 1973, for violation of 18 U.S.C. § 1341 (mail fraud), 18 U.S.C. § 1952 (interstate travel in aid of racketeering enterprises) and 26 U.S.C. § 7201 (attempt to evade income tax).
I
The County Clerk of Cook County has the responsibility for purchasing and insuring voting machines. In 1954, the State's Attorney of Cook County had rendered an opinion that competitive bidding was not required in the purchase of voting machines inasmuch as it was important to maintain uniformity in all of the County's precincts. Since 900 machines had already been purchased from Shoup Voting Machine Corporation, and no one other than Shoup sold comparable machines, the situation was not adaptable to competitive bidding. The president of the Cook County Board of Commissioners, which is responsible for the management of the affairs of Cook County, testified that the 1954 opinion continued to govern the purchase of voting machines as late as 1971.
The 1954 opinion stated that "you may request a bid from the Shoup Voting Machine Co. only," but that any bid required the approval of the County Clerk and then of the County Board. The president of the County Board testified that from 1967 to 1971, four voting machine contracts covering 1,400 machines were submitted to the Board by the County Clerk, that they were unani mously approved by the Board without debate, and that in casting his own vote the president relied upon the County Clerk "to perform his statutory obligation" as to the need and "the best price for this kind of equipment for the County."
Defendant Barrett had become County Clerk of Cook County in 1955 and continued in that office until 1973, upon his conviction in this case.
The Shoup Voting Machine Corporation began to sell its 10-column, 50-row, vertical voting machines to Cook County in the early 1950's. In 1963 or 1964, the Cook County machines were converted to 6-column machines "to give more room for propositions." Irving H. Meyers, then executive vice president of Shoup, was in charge of the Cook County conversion, which took place in Chicago warehouses where the machines were stored. At that time, Meyers met Barrett.
In July, 1965, the ownership of Shoup was transferred to a group of Philadelphia investors. Meyers became a 10 percent owner and the president of Shoup.
On September 13, 1965, "in accordance with your request for bids," Meyers wrote to Barrett, proposing on behalf of Shoup to sell 250 voting machines to Cook County at $1,791 each. Having received no response, Meyers came to Chicago in December, 1965 and met with Barrett in his County Clerk office. Barrett told Meyers that he did not have the funds to purchase the machines at that time but might have the money in the forthcoming budget. Meyers testified:
I said to Mr. Barrett that any dealings between the Shoup Company and the County of Cook in the future would be between he and I. I told Mr. Barrett that I was committed to pay him five percent cash on all voting machine sales to Cook County.
Mr. Barrett said to me that he was getting more money than that before.
I said to Mr. Barrett that this was a new ball game, and that is all the money that I was committed to pay.
Mr. Barrett said that he wanted $200 per machine.
I hesitated for a moment, and then I said to Mr. Barrett that the only way I could pay him $200 per machine would be to raise the price of the voting machine by $100 to the County of Cook, and that I felt that he could vindicate the $100 increase in price, because Cook County had a bastard type voting machine.
He asked me what I meant by that.
I told him that we made two standard models of machine, and it had been the Shoup policy, whether or not we sold a county one machine or a thousand, the price was always the same. But Cook County had a machine like no other county in the United States. So, therefore, there was nothing to compare Cook County's price against any other price.
Mr. Barrett said that he could take care of the increase. Mr. Barrett said to me, when would he get the money.
I told him, naturally, I would pay him the money after Shoup received the money from the County for the purchase of the voting equipment.
Mr. Barrett said there would be times when he would need money in front.
I said to Mr. Barrett that I would give him half of the money when I received a solid, concrete contract or purchase order from Cook County, and the other half of the money when I received the funds for the payment of the voting machines by our company from Cook County.
He said that would be fine.
I told Mr. Barrett that on any dealings at any time, they would be between he and I alone, that I never wanted to be in a position where there was a third party present, for his protection and also for mine.
Barrett ran for re-election in November, 1966. Meyers made a personal $1,000 campaign contribution, which Barrett acknowledged in two letters, one prior and one subsequent to the election. After the election, Meyers called Barrett to congratulate him. That time Barrett gave Meyers his unlisted home telephone number, which Meyers placed in his personal address book.
In January, 1967, Meyers saw Barrett at the hotel where Barrett was staying in Palm Springs, California. When Meyers asked Barrett when Shoup could expect some business, Barrett replied that he thought there would be some money in the budget and that when Meyers returned to Philadelphia, he should send Barrett a proposal for 300 voting machines.
On January 13, 1967, Meyers sent Barrett a proposal for the sale of 300 voting machines at $1,898 ($107 above the 1965 bid). The proposal was valid to March 15, 1967. Before the expiration date, Meyers telephoned Barrett and was told the County did not have the funds to buy the machines.
Barrett telephoned Meyers in October, 1967 and requested another bid for the 300 machines. The second proposal, sent on October 20, 1967, set the price at $1,890 ($99 above the 1965 bid). The journal of the proceedings of the Cook County Board of Commissioners for November 7, 1967, showed that the Shoup bid of October 20 was unanimously approved by the Board. Shortly thereafter, Barrett advised Meyers by telephone of the Board approval, whereupon Meyers told him that he would come to Chicago.
Meyers flew to Chicago on November 14, 1967 with a blue zippered plastic valise containing $30,000 in cash. At Barrett's prior suggestion Meyers met him at the air terminal where they had lunch together. At the restaurant Meyers put the valise between Barrett and himself and after lunch Barrett picked up the valise with the money and left.
Meyers explained how he acquired the cash which he paid Barrett:
In 1965, when I became president of Shoup, I devised a method of raising cash where there might be purposes of obtaining business where I did not have a legitimate representative, and by paying cash was the only way to receive the business.
The method that I devised was to pay different persons checks to represent Shoup in certain areas where I did not have representation, or to pay by check different professional people, lawyers or so forth for professional fees for services nonrendered.
When I paid these checks to these people they would pay their income tax and then return to me 40 or 50 percent in cash, and at the end of each year I would send out a 1099 form to these people so that they could report —make sure they would report this money on their income tax.
This is the way or the method that I used to raise cash.
The government introduced the records of the travel agency which booked Meyers' flights to and from Chicago on November 14, 1967. They showed that the flight arrived at Chicago O'Hare Airport at 12:17 p. m. and that the return flight to Philadelphia left O'Hare at 2:10 p. m. Telephone records showed a call from Shoup's office to Barrett's unlisted home telephone number on November 13, 1967. Safe deposit company records showed a visit on November 13 to one of two safe deposit boxes in which Meyers kept cash to make payments.
Shoup Corporation received the last payment from Cook County on the 300 machines in early August, 1968. Meyers then called Barrett and arranged to fly to Chicago to see him. On August 9, 1968, Meyers withdrew $30,000 in cash from his safe deposit box, placed it in a brown manila envelope and sealed it, and placed the envelope in a blue plastic valise. He flew to Chicago where Barrett met him at the airport; they had lunch at the same airport restaurant as before. Again Barrett left the meeting with the valise and the $30,000. Telephone records showed a call to Barrett's County Clerk office on August 7; safe deposit records showed a box entry by Meyers on August 9, 1968.
At the August 9 airport meeting Meyers and Barrett discussed the sale of an additional 300 voting machines. Barrett had called Meyers in April and had said that Cook County needed 300 more machines for the upcoming presidential election but did not have the money. Shortly thereafter Meyers called Barrett and advised him that Shoup could furnish 200 new machines and 100 reconditioned used machines at a rental of $300 per machine for the November election, with an option to purchase the machines and a credit of the rental on the purchase price. A contract incorporating those terms, with the. option-sale price fixed at $1,890 per new machine and $1,790 per used machine, was signed by Barrett as County Clerk and by Meyers for Shoup, dated August 8 and approved by the County Board according to its journal on August 9, 1968.
At the meeting at the airport on the 9th, Meyers asked whether Barrett thought that the County would exercise the option to purchase the machines. When Barrett assured him that it would, Meyers told him that he would give him $15,000 in a few weeks and another $45,000 when the County paid for the machines. Barrett agreed to that arrangement.
On August 20, 1968, Meyers telephoned Barrett and told him that he was playing in a Shoup-sponsored golf tournament that week but would send his brother-in-law, Tony Lemisch, "with a package for him." Meyers testified that he had withdrawn $15,000 in cash from his safe deposit box several days before and kept it in a safe in his home. On the 20th, he gave the money to Lemisch in a sealed envelope. Lemisch went to Chicago on that day and delivered the envelope to Barrett in his County Clerk office. Later Meyers telephoned Barrett to verify his receipt of the money. These dates were also corroborated by records showing a safe deposit entry on August 16 and telephone calls to Barrett on August 20 and 22, 1968.
The option was exercised by Cook County and on February 11, 1969, Shoup Corporation deposited an installment check from the County for $278,500. ' Two days later on February 13, Meyers, who was on his way to Las Vegas for his daughter's wedding, stopped at Chicago. He had placed $45,000 in a manila envelope, sealed it, and put it in a blue valise. Barrett met him at the airport gate in Chicago, took the valise and left. Meyers continued on to Las Vegas. Records showed that Meyers entered his safe deposit box on February 13, 1969 and that on that date he took a plane from Philadelphia, which landed in Chicago in the afternoon and then continued to Las Vegas.
In October, 1969, Barrett telephoned Meyers and told him that the County was going to purchase 300 more voting machines. Meyers told him that the price had increased and that he would let him know what the new price would be. On November 3, Meyers wrote Barrett advising him that the new price for 300 voting machines was $2,025 per machine. A contract with those terms was signed by Barrett for the County and by Meyers for Shoup Corporation and was approved by the County Board on March 2, 1970. By letter dated March 4, the County Clerk's office advised Meyers that the contract had been approved. A few days thereafter Meyers telephoned Barrett and advised him that near the end of March he was going west and would stop at Chicago.
On March 23, 1970, Meyers withdrew $30,000 from his safe deposit box, sealed it in a brown manila envelope and placed the envelope in a blue vinyl plastic ease. He flew to Chicago, met Barrett at the airport and handed him the case with the money. At that meeting, Barrett requested a political contribution because he was running for re-election. Meyers answered that "I gave him a political contribution every time I gave him a blue valise, and that there was no chance that he would not win re-election anyhow." Barrett smiled and left with the money.
In August, 1970, Meyers advised Barrett that the March order for 300 machines could be filled with excellent used machines at a lower price. Thereafter on August 17, the County and Shoup executed a revised contract at a reduced price of $1,897 per machine. Shoup received a check from Cook County for $189,700 dated August 14, which was deposited on August 20, 1970.
On August 28, 1970, Meyers withdrew $30,000 out of his safe deposit box and went through the customary procedure to deliver it on August 30 to Barrett at the Chicago airport.
The March 23 and August 30, 1970 payments are documented by safe deposit records and used airline tickets purchased by Meyers.
In regard to his paying $180,000 to Barrett in cash, Meyers testified:
I paid this money to Mr. Barrett to insure getting the business, the voting machine business in Cook County. I felt that with Mr. Barrett's recommendation on the purchase of the Shoup voting machines that there would be no problem in passing the board.
In December, 1970, Meyers was subpoenaed to appear before a federal grand jury in Philadelphia and to turn over all Shoup Corporation records. In July, 1971, he was first indicted. In November, 1971, Meyers telephoned Barrett and asked to see him. Barrett agreed, Meyers flew to Chicago on November 9, and the two men had lunch at Club 39.
Meyers brought with him "a brown manila envelope containing my indictments" and told Barrett that he was "in a lot of trouble." Barrett asked if he might become involved and Meyers assured him that he would not. Barrett asked how Meyers obtained the cash he had paid Barrett and Meyers explained the "conduit system" that he used. He then pleaded with Barrett for more voting machine business, explaining that he had resigned as Shoup president but was the exclusive sales agent for Shoup. Barrett told him that the County would probably be purchasing 500 more machines.
Thereafter, on December 20, 1971, the County approved a contract with Shoup for 500 voting machines at $1,995 per machine. No money was ever paid to Barrett in regard to the last 500 machines.
The purchasing of insurance on the voting machines owned by Cook County was the responsibility of Barrett in his ex officio role as Comptroller of Cook County. The Deputy Comptroller was C. R. Hodgman. During the period 1967 through 1971, the voting machine insurance was placed by Hodgman with Arthur J. Gallagher & Company, an insurance agency. Premiums were paid directly to the insurance carrier by Cook County, and the carrier in turn paid a 25 percent commission to Arthur J. Gallagher & Company. The Gallagher firm retained a 10 percent commission, and paid a 15 percent commission to Barrett. Barrett never reported to the County Board that he was receiving these commissions. Although Edward Keating, vice president of Arthur J. Gallagher, testified that the County received the best possible bargain on the insurance, he admitted that the choice was limited to those insurance companies with which the Gallagher firm had an agency agreement. Further, Keating testified that, at the direction of Hodgman, the Gallagher firm was not identified on the insurance policies, contrary to the customary procedure. Barrett was an insurance broker who received commissions on other business. During the period 1968 through 1970 approximately $6,000 of his $17,000 in commissions was on voting machine insurance.
The use of the mails consisted of the mailing of checks by Cook County to the insurance companies, and the mailing of cheeks by the insurance companies to the Gallagher firm.
Barrett was named in a 16-count indictment returned on September 28, 1972. The first six counts charged violation of the Travel Act (18 U.S.C. § 1952), in that Barrett had caused officials of Shoup Voting Machine Corporation to travel in interstate commerce for the purpose of receiving bribes from those officials to influence his acts as County Clerk of Cook County. The next four counts charged Barrett with violation of 26 U.S.C. § 7201 by filing false and fraudulent income tax returns for 1967, 1968, 1969 and 1970, in that he understated his taxable income in each of those years. The final six counts charged Barrett with violation of 18 U. S.C. § 1341 by using the mail to further a scheme to defraud the people of Cook County by causing insurance brokers' commissions to be paid to him upon premiums paid by the County for insurance coverage of its voting machines. The last six counts were dismissed and replaced by similar counts in a superseding indictment returned on January 10, 1973.
The trial commenced on February 22, 1973. The jury returned a verdict of guilty on all counts. Barrett was sentenced to three years' imprisonment on each count, the sentences to run concurrently, and was fined a total of $15,000.
II
Defendant Barrett first complains of prejudicial publicity.
On February 22, 1973, the day the trial commenced, defendant moved for a continuance on the basis of three types of newspaper publicity. The first type consisted of stories which appeared when the indictment was returned on September 28.
In United States v. Hoffa, 367 F.2d 698, 711 (7th Cir. 1966), vacated on other grounds 387 U.S. 231, 87 S.Ct. 1583, 18 L.Ed.2d 738 (1967), we pointed out:
Whenever any person of prominence is charged with a crime, the story usually will receive wide distribution through various news media. It may be impracticable to postpone the trial for a period long enough for public interest to die down. .
Here defendant was a prominent political figure in Chicago and Cook County, having served as County Clerk for 18 years.
The news stories (1) discussed the indictment and did not go beyond the language of the indictment, (2) discussed defendant's political career and in that respect were favorable, and (3) contained self-serving and lengthy comments by defendant and his attorney proclaiming his innocence. This group of stories appeared five months prior to the trial.
A second group of news stories appeared from February 9 thru 15, 1973 and dealt with the insurance premiums on City of Chicago business received by an insurance firm employing the son of the mayor of Chicago, court receivership positions obtained by the president of the insurance firm, and the insuring of receivership properties. Defendant Barrett was not named in this group of news items.
The third group of news stories related to the jury verdict returned in the same Chicago federal court building on February 20, finding former Illinois governor and court of appeals judge Otto Kerner guilty of various crimes including bribery, mail fraud and income tax violations. These stories did not mention Barrett.
At the beginning of the voir dire examination of prospective jurors on February 22 in this case, the district judge strongly emphasized that he was seeking "a fair and impartial trial based entirely on what transpires in this courtroom from now on and not based in any way or influenced by anything that has occurred in other courtrooms in this building." The judge then asked the panel of venirepersons:
Having in mind the recent publicity in regard to the other cases where there were some similar charges, is there any of the jurors who feel that publicity and the knowledge that you gained from that publicity, would have an effect on your verdict in this case?
No one responded. In personally examining the first prospective juror in the presence of the entire panel, the judge asked:
Have you formed any opinions about this case by virtue of any newspaper or television publicity, either in regard to this particular case or any other cases that have been recently tried that would affect your verdict in this case?
When additional panels of venireper-sons were brought into the courtroom on two subsequent occasions, the judge reemphasized the same conditions of impartiality. Each juror eventually selected to serve on the Barrett jury was personally asked whether he would base his judgment only on what transpired in this courtroom during this trial and not what he might have read about or what he heard had occurred in other courtrooms.
Defendant's counsel was permitted to question the jurors. He accepted the panel, each of whom had been interrogated concerning pre-trial publicity and the effects of other trials of political personages. At no time did defendant's counsel seek a change of venue.
That the public attitude toward general political corruption may appear to be more severe at one time than another does not justify a moratorium on the prosecution of crimes by political figures, absent pervasive prejudicial publicity and failure to screen prospective jurors. Here the pre-trial publicity was not extremely pervasive, much of it was directed to political figures other than the defendant, and that concerning the defendant did not go beyond reciting the charges of the indictment. Most importantly, each prospective juror was carefully screened to expose any possible prejudice. The district judge was correct in denying the motion for a continuance.
The jury was selected and sworn in on Friday, February 23, 1973, but the opening statements were not to begin until Monday, February 26. On Friday, defendant's counsel agreed that the jury need not be sequestered over the weekend:
Let's wait until Monday morning and let the jury go home, get their gear together and they won't have anything that would tempt them to discuss the details of this ease.
When the district judge excused the jury for the weekend, he admonished the jurors as follows:
I am advising you now not to read anything about this case in the paper, not to listen to anything about this case over radio or television.
I don't know what they could tell you that you haven't heard in the courtroom, except that we got a jury, and you know that already. So that I don't see how anything you might read would have any effect on you.
But regardless of that, I admonish you not to read anything about it, not to discuss this case with anyone at home.
There are some who, I am sure, will have people say, what are you doing, and when you tell them, they will say, "Well, if I was on the jury, this is what I would do."
Well, I don't want you to listen to people who are not on the jury to find out what you should do. So just tell them that in a couple weeks or less you will be able to tell them everything, but you don't want any preliminary advice from people at home or from people that you will meet socially over the week end [sic].
I am goiñg to question you again on Monday morning as to whether you have followed my admonition in regard to not discussing the case, not reading about it, not listening to it
On Monday, the court asked the jury:
First of all, ladies and gentlemen, last Friday I admonished you to conscientiously and purposefully avoid reading about anything over the weekend involving this case, or to listening to anything on radio or TV involving this case.
Is there anyone on this jury that failed to comply with my request? If so, raise your hand.
No one responded.
Over the weekend one Chicago newspaper carried an article describing the United States Attorney's investigations of various local politicians, including both Kerner and Barrett. A second article was a comparison between Kerner and Barrett, their personalities, trial strategy, and the charges against them. The article speculated that the Barrett verdict would depend on whether the jury believed Meyers or Barrett, but noted it was unlikely that Barrett would testify. Defendant moved for a mistrial on the basis of these articles.
Each case of alleged prejudicial publicity must rest on its "special facts." United States v. Jannsen, 339 F.2d 916, 920 (7th Cir. 1964). "The severity of the threat depends upon both the nature of the information so publicized and the degree of juror exposure to it. Moreover, the judge's response is to be commensurate with the severity of the threat posed." United States v. Thomas, 463 F.2d 1061, 1063 (7th Cir. 1972). As we stated in Margoles v. United States, 407 F.2d 727, 735 (7th Cir.), cert. denied, 396 U.S. 833, 90 S.Ct. 89, 24 L.Ed.2d 84 (1969):
Thus, the procedure required by this Circuit where prejudicial publicity is brought to the court's attention during a trial is that the court must ascertain if any jurors who had been exposed to such publicity had read or heard the same. Such jurors who respond affirmatively must then be examined, individually and outside the presence of the other jurors, to determine the effect of the publicity. However, if no juror indicates, upon inquiry made to the jury collectively, that he has read or heard any of the publicity in question, the judge is not required to proceed further. .
The district court followed this procedure.
Given the Friday admonitions and the negative responses of the jurors on Monday morning, the district court could reasonably conclude that no juror had read any of the weekend publicity. He did not err in refusing to declare a mistrial.
Ill
The defendant contends that his conviction on the bribery charges was contrary to law and a violation of his due process right to a fair trial in that the court failed to suppress illegally obtained evidence.
The only important witness against defendant on the bribery charges was Irving H. Meyers. Defendant filed a pre-trial motion to suppress Meyers' testimony because it was induced by the government's promise of civil tax immunity on the $700,000 which passed through his safe deposit boxes.
The government's promise was one of the terms of the plea bargaining deal negotiated with Meyers in his criminal trial in Pennsylvania. Meyers' part of the deal was to plead guilty to several counts of conspiracy and mail fraud and to two counts of filing false income tax returns which did not report as taxable income portions of the $700,000 fund. Meyers also agreed to testify in other proceedings about what happened to the $700,000. In return, the government recommended a sentence on all counts of one year and a day, to be imposed under a statute making Meyers immediately eligible for parole, and to be served at the detention facility at Eglin Air Force Base, Florida. The government also granted Meyers transactional immunity to preclude state prosecutions. In addition, the Pennsylvania prosecutor recommended to the I.R.S. that it exempt Meyers from civil tax liability on any part of the $700,000 which he would testify under oath he had paid as bribes or political contributions to public officials.
The theory of defendant's motion was that the government in effect had paid Meyers one million dollars to testify against defendant and other public officials. Each time he testified, Meyers was relieved of the obligation to pay income tax and fraud penalties on whatever amount of the cash he said he gave to the official. Defendant claims this arrangement violates 18 U.S.C. § 201(h):
Whoever, directly or indirectly, gives, offers, or promises anything of value to any person, for or because of the testimony under oath . . . given or to be given by such person as a witness upon a trial, hearing, or other proceeding . . . [s]hall be fined not more than $10,000 or imprisoned for not more than two years, or both.
Because Meyers' testimony was obtained through inducement in violation of section 201(h), defendant argues, the testimony should have been suppressed.
Instead, the trial court denied the motion but allowed defendant to impeach Meyers oh cross-examination by bringing out all the terms of the plea bargain. Counsel was allowed to argue to the jury that the civil tax immunity agreement gave Meyers a motive to lie about giving $180,000 to the defendant.
The premise of defendant's argument for suppression is that the government has no authority to allow civil immunity in return for testimony. He concedes that a prosecutor would not violate section 201(h) by granting criminal immunity, because 18 U.S.C. § 6002 gives the government that power. But granting unauthorized civil immunity, according to the defendant's argument, is giving a witness something of value for his testimony in contravention of section 201(h).
Both parties' briefs overlook 26 U.S.C. § 7122:
(a) Authorization.- — The Secretary [of the Treasury] or his delegate may compromise any civil or criminal case arising under the internal revenue laws prior to reference to the Department of Justice for prosecution or defense; and the Attorney General or his delegate may compromise any such case after reference to the Department of Justice for prosecution or defense.
It is not clear from the record whether the prosecutors or the I.R.S. representatives were, or believed they were, acting under this statute. Since the case was in the hands of the Justice Department, the Attorney General could have compromised Meyers' civil tax liability without approval of the I.R.S. From the record, it appears that both agencies thought I. R.S. approval was necessary. Whether the government has effectively bound itself to a compromise of Meyers' civil tax liability is a matter between Meyers and the government.
The significance of section 7122 for defendant is that the end the government was seeking to accomplish— Meyers' exemption from civil tax liability — was authorized bylaw. If the government can excuse criminal or civil liability in settling a criminal case, surely it can use that power of compromise to obtain guilty pleas or to procure testimony in other proceedings. Both are legitimate objectives of plea bargaining.
Because the Justice Department is empowered to grant both civil and criminal immunity in tax cases, such a grant to a prospective witness cannot be considered to violate section 201(h).
Defendant's alternate argument for suppression of Meyers' testimony is that the inducement of civil immunity when added to the normal unreliability of accomplice testimony constituted a denial of due process. Our holding that there was no illegal inducement deflates this contention considerably.
The two cases defendant relies on do not compel suppression of Meyers' testimony. The court in United States v. Fishel, 324 F.Supp. 429 (S.D.N.Y.1971), suppressed a tape recording of an alleged bribery transaction. The government had lost two earlier recordings of conversations which the defendant claimed would have established that he had been entrapped. Suppression of the tape (but not the testimony of the con-versants) was the only available remedy in Fishel, because no amount of cross-examination of government witnesses about the earlier conversations would have had the impact that the third tape recording would have had on the jury. In the present case, cross-examination of Meyers fully amplified defendant's theory of Meyers' possible motivations for lying. His testimony was not so tainted by government misconduct that its admission violated due process.
In United States v. Haderlein, 118 F.Supp. 346 (N.D.Ill.1953), the trial court directed a verdict of acquittal after hearing the uncorroborated testimony of a coconspirator who had been threatened with revocation of citizenship and who admitted perjury in connection with the very facts to which he testified. Haderlein is distinguishable from the present case by the elements of government coercion, the witness' admission of perjury and the total lack of corroboration. Further, the trend of recent cases suggests that the court in Haderlein would have been justified in allowing the jury to hear all the evidence impugning the witness' motives and veracity and to decide his credibility for itself. Giglio v. United States, 405 U.S. 150, 92 S.Ct. 763, 31 L.Ed.2d 104 (1972); United States v. Tanner, 471 F.2d 128 (7th Cir. 1972); United States v. Isaacs, 347 F.Supp. 763 (N.D.Ill.1972).
Because the government was authorized to grant Meyers civil tax immunity and because the defense was allowed to bring out all the terms of the plea bargain to the jury, use of Meyers' testimony did not deprive the defendant of a fair trial.
IV
Defendant contends that the conviction on the six mail fraud counts cannot stand because (1) active fraud rather than constructive fraud must be proved, (2) actual injury, or the capability thereof, must be proved, and (3) Illinois law does not require that the money received by defendant be turned over to the County.
Virtually every argument by the defendant has been answered by Judge Cummings' careful and detailed treatment of a closely analogous fact situation in United States v. George, 477 F.2d 508 (7th Cir.), cert. denied, 414 U.S. 827, 94 S.Ct. 155, 38 L.Ed.2d 61 (1973).
In George the purchasing agent for Zenith Radio Corporation received approximately one-third of spurious commissions paid to a third party by a supplier of cabinets for Zenith. Zenith had a conflict-of-interest policy providing that no gratuities of any nature were to be bestowed on its Purchasing Department employees by suppliers. Despite the facts that the kickbacks did not "come out of Zenith's pockets," that the purchasing agent did not request any preferential treatment for the supplier, that the supplier was not given any preferential treatment beyond receiving the cabinet business, that the supplier's prices to Zenith were fair and reasonable and within Zenith's general guidelines for its suppliers' prices, that Zenith was never shown to be dissatisfied with the cabinet supplier's products or prices, and that the purchasing agent insisted on efficiency and quality from the supplier, nevertheless this court affirmed the conviction of the purchasing agent, supplier and the third party under the mail fraud statute.
The court held that Zenith was deprived of its employee's honest, faithful and loyal performance of his duties to the extent that he secretly profited from his agency and concealed from Zenith the knowledge that its supplier was willing to sell the cabinets for a lesser net price. "It is preposterous to claim that Zenith would have spurned [the] discount [paid by the supplier to the third party] if offered." 477 F.2d at 513.
The court in George held that "[t]he mail fraud statute delineates two essential elements constituting the crime: a scheme to defraud and use of the mails in furtherance of the scheme." 477 F.2d at 511. None of the three participants disclosed the arrangement to Zenith. The court found the existence of not only a scheme to defraud and a capability of injury to Zenith, but of actual fraud and actual injury. "[T]he fraud consisted in [the purchasing agent's] holding himself out to be a loy al employee, acting in Zenith's best interests, but actually not giving his honest and faithful services, to Zenith's real detriment."' 477 F.2d at 513.
In the present case, as in George, no issue is raised as to the sufficiency of the evidence to establish use of the mails, nor could the're be.
Instead of a private company's conflict-of-interest policy, here there is the state policy in regard to its public officials. "No trustee has more sacred duties than a public official and any scheme to obtain an advantage by corrupting such an [sic] one must in the federal lav/ be considered a scheme to defraud." Shushan v. United States, 117 F.2d 110, 115 (5th Cir.), cert. denied, 313 U.S. 574, 61 S.Ct. 1085, 85 L.Ed. 1531 (1941). As a specially designated panel of this court recently said in applying the mail fraud statute to an Illinois public official, "[t]he citizens of Illinois were defrauded of Kerner's honest and faithful services as governor." United States v. Isaacs, 493 F.2d 1124, 1150 (7th Cir.), cert. denied, 417 U.S. 976, 94 S.Ct. 3184, 41 L.Ed.2d 1146 (1974).
Both the Cook County purchasing agent and the chief deputy Cook County clerk testified that during the times involved here the full responsibility for obtaining insurance on voting machines owned or rented by Cook County was vested in the defendant Barrett in his position as Cook County Clerk (Tr. 1022, 1028-29). The president of the Cook County Board of Commissioners testi-fled that Barrett never disclosed to him that he was receiving insurance brokerage commissions on the County's voting machines (Tr. 1088-89).
The vice president of Arthur J. Gallagher & Company, which since 1961 received a 25 percent commission upon the insurance covering Cook County voting machines and delivered 15 percent of that commission to Barrett, was called as a witness by Barrett. Upon cross-examination, the witness testified that, although insurance policies should be countersigned by the resident agents, he was advised in 1961 by the deputy comptroller under Barrett to make certain that the name of the Gallagher firm did not appear on any of the voting machine insurance policies (Tr. 1298). He also testified that although the County received the best possible rates, the choice of companies was limited to those insurance companies which the Gallagher firm represented through an agency agreement (Tr. 1295).
The only distinction between George and this case is the fact that there the commission paid to the third party was spurious, whereas here the Gallagher firm was entitled to the commission for having procured the insurance business. However, in both cases the person saddled with the responsibility for devoting loyal service to his employer concealed his secret profit from his employer and denied to that employer the right to know that the supplier of the product or service was willing to continue the supply at a discount to which the employer was entitled.
We conclude that the conviction of the defendant Barrett on the mail fraud counts was warranted by the evidence and the law.
V
Defendant's pre-trial motion to sever the mail fraud charges from the bribery and tax evasion charges under Rules 8(a) and 14, Fed.R.Crim.P., was denied.
The government's theory of joinder is that the bribery scheme and the insurance commission scheme were two transactions connected by Barrett's use of his public office for private gain.
In Finnegan v. United States, 204 F.2d 105 (8th Cir.), cert. denied, 346 U.S. 821, 74 S.Ct. 36, 98 L.Ed. 347 (1953), defendant was an I.R.S. employee charged with three counts of representing private clients and two counts of bribery. He was acquitted of bribery and one of the representation counts. The court held joinder of the five counts was proper under Rule 8(a) (204 F.2d at 109):
All five of the offenses charged in this indictment were for violations of statutes designed to protect the government. The charge in each of the counts was the acceptance of money either for representing an interest adverse to the government or as a bribe to perform some act adverse to the interest of the government, the defendant being a trusted public official. All the offenses in effect charged a government official with taking the part of private interest in matters in which the government was a party. All of the counts involved directly or indirectly, the use of official position for the benefit of private interest for a pecuniary consideration.
In Egan v. United States, 52 App.D.C. 384, 287 F. 958 (1923), defendant was a public official charged with representing a private party and with taking money to influence his official decisions. The court said the two crimes belonged to the same class.
In United States v. Weber, 437 F.2d 327 (3d Cir. 1970), cert. denied, 402 U.S. 932, 91 S.Ct. 1524, 28 L.Ed.2d 867 (1971), defendant was a union official charged with Taft-Hartley and Hobbs Act violations. The court upheld the joinder under Rule 8(a) because the violations were connected by defendant's scheme to accept money from New Jersey contractors who employed members of his union.
In the Kerner case, Kerner asked for a severance under Rule 8(a) only of the perjury charge from all the other charges. The court held that the perjury and other charges were "all connected with, or arose out of, a common plan to corruptly influence the regulation of horse racing." United States v. Isaacs, 493 F.2d 1124, 1159 (7th Cir. 1974), cert. denied, 417 U.S. 976, 94 S.Ct. 3184, 41 L.Ed.2d 1146 (1974).
These cases support the government's position that here "[t]wo or more offenses may be charged in the same indictment . if the offenses charged . . . are . . . two or more acts or transactions connected together . . . ."
A more difficult question arises under Rule 14, which looks to the prejudice caused a defendant by a joinder of offenses. Obviously any adding of offenses to others is prejudicial to some extent. However, "[w]hether a severance of related offenses should be granted must remain largely within the discretion of the trial judge upon consideration of the circumstances of the individual case." American Bar Association Project on Standards For Criminal Justice, Standards Relating to Joinder and Severance, § 2.2(b) Commentary, p. 32 (1968).
Reversal of a conviction on the ground of abuse of discretion for failure to sever an offense under Rule 14 is almost non-existent. Recently such a reversal occurred in this circuit in United States v. Pacente, 490 F.2d 661 (7th Cir. 1973), but on rehearing en banc the conviction was affirmed, 503 F.2d 543, 546 (7th Cir. 1974), where this court said:
The grant or denial of severance or separate trials under Rule 14 is discretionary. See, e. g., United States v. Kahn, 381 F.2d 824, 841 (7th Cir., 1967), cert. denied 389 U.S. 1015 [88 S.Ct. 591, 19 L.Ed.2d 661]; United States v. Quinn, 365 F.2d 256, 267 (7th Cir., 1966). Denial of relief will produce reversal only if abuse of discretion is shown. United States v. Rogers, 475 F.2d 821, 828 (7th Cir., 1973).
We cannot say that the district judge abused his discretion in this case.
VI
Defendant raises several miscellaneous issues regarding pre-trial and post-trial motions, rulings upon evidence, and instructions.
Defendant filed and the district court denied a motion for a bill of particulars in regard to the six Travel Act-bribery charges, four of which charged travel in a specific month and two of which charged travel in a specified two-month period.
The motion for a bill of particulars is addressed to the sound discretion of the court. United States v. Kaplan, 470 F.2d 100, 103 (7th Cir. 1972), cert. denied, 410 U.S. 966, 93 S.Ct. 1443, 35 L.Ed.2d 701 (1973). "Of course, every denial of a defendant's request for a bill of particulars may in some measure make the preparation of his defense more onerous. But a demonstration of this generalized kind of prejudice is insufficient to override the broad discretionary power vested in a district court with respect to such requests." United States v. Wells, 387 F.2d 807, 808 (7th Cir. 1967), cert. denied, 390 U.S. 1017, 88 S.Ct. 1272, 20 L.Ed.2d 168 (1968).
The defendant seeks to demonstrate prejudice by reference to his motion for a new trial based on newly discovered evidence, which set forth the affidavit of Mari jan Bojovic, a friend of defendant and his wife, who stated that she visited with the Barrets in Palm Springs, California, in February, 1969, and that Barrett was there from February 5 to February 16.
The indictment charged as to that count that Meyers had visited Barrett in Chicago "about February and March, 1969." Meyers testified at the trial that the visit occurred on February 13, 1969. Mr. and Mrs. E. B. Smith gave their affidavits that they had dinner with the Barretts and Ms. Bojovic in Palm Springs on February 14 and telephoned Barrett there on the evening of February 13. These facts did not rule out the possibility that Barrett was in Chicago to meet Meyers on February 13 but returned to Palm Springs that evening to receive the Smiths' telephone call and to play cards with Ms. Bojovie.
The motion for a new trial on the basis of newly discovered evidence was properly denied because the "new evidence" was offered simply "to impeach the character or credit of a witness," defendant failed to show diligence in not discovering the evidence prior to or during the trial, and the defendant failed to meet the burden of showing "that the newly discovered evidence is so material that it probably would produce a different result if a new trial were granted." United States v. Curran, 465 F.2d 260, 264 (7th Cir. 1972).
This being so, and particularly since Ms. Bojovie further swore that she "visited Mr. and Mrs. Barrett in Palm Springs, California, every February from 1966 until 1970," it is very difficult to perceive how the defendant was prejudiced by being informed by the indictment that one of the Meyers' visits was "about February and March, 1969." As noted in United States v. Tanner, 279 F.Supp. 457, 476 (N.D.Ill.1967), aff'd in part and rev'd in part, 471 F.2d 128 (7th Cir.), cert. denied, 409 U.S. 949, 93 S.Ct. 269, 34 L.Ed.2d 220 (1972), the government "need not furnish the exact date, since to do so would limit the Government to strict proof thereof at trial."
The defendant complains of the exclusion of several exhibits, most of them relating to Meyers' income and cash availability, which were sought to be introduced to impeach him. Most of this material was cumulative of impeachment cross-examination of Meyers and often it went into areas which were clearly irrelevant. "The trial judge has wide discretion in the admission or exclusion of collateral evidence." United States v. Stone, 471 F.2d 170, 172 (7th Cir. 1972), cert. denied, 411 U.S. 931, 93 S.Ct. 1898, 36 L.Ed.2d 391 (1973). We find no reversible error in the exclusion of exhibits.
Defendant challenges government instructions 49, 50 and 51, regarding mail fraud. We find each of these instructions proper in view of our discussion of mail fraud in Part IV and particularly in view of United States v. George, 477 F.2d 508, 513 n. 6 (7th Cir.), cert denied, 414 U.S. 827, 94 S.Ct. 155, 38 L.Ed.2d 61 (1973).
The defendant in a criminal case is entitled to have the jury consider a theory of defense which is supported by law and which has some foundation in the evidence. United States v. Bessesen, 445 F.2d 463, 467 (7th Cir.), cert. denied, 404 U.S. 984, 92 S.Ct. 448, 30 L.Ed.2d 368 (1971). Defendant proffered a theory of mail fraud defense which contained several statements of theories which did not constitute legal defenses to mail fraud. The district court properly rejected it. Nor was there any error in the re-reading of the mail fraud instructions when the jury so requested.
Finally, the defendant contends that he was denied a fair and impartial trial by the prejudicial conduct of the court. We have read the record in this case. We found that while the perfect trial has yet to be tried, this trial was tried as well as any of those we affirm, by an experienced jurist who was careful to preserve the defendant's right to a fair trial.
The conviction is affirmed.
Affirmed.
. Section 1341 provides in part: "Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises . . . for the purpose of executing such scheme or artifice or attempting so to do, places in any post office or authorized depository for mail matter, any matter or thing whatever to be sent or delivered by the Postal Service, or takes or receives therefrom, any such matter or thing, or knowingly causes to be delivered by mail according to the direction thereon, or at the place at which it is directed to be delivered by the person to whom it is addressed, any such matter or thing, shall be fined not more than $1,000 or imprisoned not more than five years, or both."
. Section 1952 provides in part: "(a) Whoever travels in interstate . . . commerce or uses any facility in interstate . . . commerce, including the mail, with intent to—
"(1) distribute the proceeds of any unlawful activity; or
St S: *
"(3) otherwise promote, manage, establish, carry on, or facilitate the promotion, management, establishment, or carrying on, of any unlawful activity,
and thereafter performs or attempts to perform any of the acts sxxecified . . . shall be fined not more than $10,000 or imx>risoned for not more than five years, or both.
"(b) . . . 'unlawful activity' means . . . bribery . in violation of the laws of the State in which committed. It
. Section 7201 provides in part: "Any person who willfully attempts in any manner to evade or defeat any tax . or the payment thereof shall . be fined not more than $10,000, or imprisoned not more than 5 years, or both, together with the costs of prosecution."
. See notes 1-3, supra,, for text of the pertinent portions of the three statutes which Barrett was charged with violating.
. Barbara M. Schoors (Tr. 52-55) ; Deanet-ta Mensink (Tr. 64-66) ; Eli Rungaitis (Tr. 80-83) ; Robert J. Peters (Tr. 85-87) ; Richard E. Vincent (Tr. 117-21) ; Edward Liechtenhagen (Tr. 131-33) ; Vera C. Lynch (Tr. 140-43) ; Charles O. Cash (Tr. 160-62) ; Charlotte R. Bogdan (Tr. 226-29) ; Joseph E. Kerwin (Tr. 232-35) ; Robert C. Smart (Tr. 247-50) ; and Kenneth N. Pearson (Tr. 258-61).
. The motion also applied to the testimony of Anthony Lemiseh, a minor witness who made a similar bargain in the Pennsylvania trial.
. 18 U.S.C. § 4208(a)(2).
. One peculiar aspect of this bargain is the inconsistency in the government's indicting and convicting Meyers for failing to report some of the safe-deposit-box cash as taxable income to himself, and at the same time excusing his civil tax liability on that income. The government does not attempt to explain the contradiction, except at oral argument it did contend that Meyers should have reported the cash as gross income and deducted the bribes as a business expense. Of course such an expense is not deductible. 26 U.S.C. § 162(c) ; Dixie Machine Welding & Metal Works, Inc. v. United States, 315 F.2d 439 (5th Cir.), cert. denied, 373 U.S. 950, 83 S.Ct. 1679, 10 L.Ed.2d 705 (1963). Besides, Meyers was convicted of falsifying his taxable, not his gross income.
. The decision in Giglio v. United States, 405 U.S. 150, 92 S.Ct. 763, 31 L.Ed.2d 104 (1972), requiring the government to disclose a promise of leniency made to a key witness in return for his testimony, implies that suppression is not an appropriate remedy. See United States v. Isaacs, 347 F.Supp. 763, 767 (N.D.Ill.1972), where the court added: "We would expect the Court in Giglio not to have ordered a new trial, or alternatively to have ordered suppression of Taliento's testimony in a second trial, if the Government's reward of leniency warranted suppression."
. The government's justification for granting civil liability was a denial of giving Meyers "anything of value." It argued that Meyers was a mere "conduit," not the beneficial recipient of the cash; therefore the cash was not taxable income to him. There is obvious difficulty in squaring this explanation with the fact of Meyers' conviction (see note 8, supra). Moreover, the question whether the cash was income to Meyers is a close one that cannot be settled on this record.
On the one hand, Meyers could be considered an agent of Shoup Voting Machine Corporation in raising cash through false vouchers to the company and in using the cash to bribe public officials to buy Shoup voting machines. Cf. Boyle, Flagg & Seaman, Inc., 25 T.C. 43 (1955); Paul A. Gorin, T.C. Memo 1968-57; Eph H. Hoover, Jr., T.C. Memo 1968-49; Patrick H. Smith, T.C. Memo 1964-274.
But Meyers, president and 10 percent shareholder of Shoup, carried out his scheme with the knowledge of only one other shareholder, the secretary-treasurer and a salesman. One could argue Meyers embezzled the cash from Shoup, took complete control of it and used it to boost his own sales record. Cf. Estate of Geiger v. Commissioner of Internal Revenue, 352 F.2d 221 (8th Cir. 1965), cert. denied, 382 U.S. 1012, 86 S.Ct. 620, 15 L.Ed.2d 527 (1966); Barbara M. Bailey, 52 T.C. 115 (1969); Ernestine K. Alcorn, T.C. Memo 1969-147.
The record does not show to what extent Meyers controlled Shoup, nor what effect the cash drain to the fraudulent payees and the public officials had on the company's profit margin. Without such information, we cannot say whether Meyers was acting more for Shoup or for himself.
. The mailings, both of checks by Cook County to the insurance companies and of checks by the insurance companies to the Gallagher firm, were "for the purpose of executing such a scheme or artifice. . . ." See United States v. Maze, 414 U.S. 395, 405, 94 S.Ct. 645, 651, 38 L.Ed.2d 603 (1974).
. During the times involved in this case, which were all prior to the July 1, 1971 effective date of the new Illinois Constitution, Article X, Section 10 of the Constitution of 1870 provided that all fees or allowances received by county officers in excess of their compensation should be paid into the County Treasury. IU.Rev.Stat. cb. 53, § 49 provides that the County Clerk of Cook County shall be paid "as the only compensation for services rendered in the capacity of county clerk, or in any other capacity, the sum of $25,000 per annum." Ill.Rev.Stat. ch. 38 § 33-3 provides that "[a] public officer or employee commits misconduct when, in his official capacity, he commits any of the following acts: . . . [s]olicits or knowingly accepts for the performance of any act a fee or reward which he knows is not authorized by law." The penalties include forfeiture of office, fine and imprisonment.
. The instructions to the jury required a finding of specific intent to defraud as a prerequisite to a finding of guilt as to any and all of the mail fraud counts (Tr. 1621, 1646-47). In addition, the jury was instructed that good faith was a complete defense to the mail fraud counts (Tr. 1647). Finally, in regard to mail fraud, "[i]n determining whether the defendant acted in good faith or with intent to defraud with respect to these six offenses charged in these counts, you should consider all of the facts and circumstances relating to these alleged offenses." (Tr. 1647).
. Fed.R.Crim.P. 8(a) states: "Two or more offenses may be charged in the same indictment or information in a separate count for each offense if the offenses charged, whether felonies or misdemeanors or both, are of the same or similar character or are based on the same act or transaction or on two or more acts or transactions connected together or constituting parts of a common scheme or plan." (Emphasis added.)
. Fed.R.Crim.P. 14 provides in part: "If it appears that a defendant or the government is prejudiced by a joinder of offenses or of defendants in an indictment or information or by such joinder for trial together, the court may order an election or separate trials of counts, grant a severance of defendants or provide whatever other relief justice requires."
. The A. B. A. Standards Commentary also states in regard to joinder: "The joinder together for one trial of two or more offenses of the same or similar character when the offenses are not part of a single scheme or plan has been subjected to severe criticism over the years. . . . Such joinder is allowed under Federal Rule 8. . . ." Section 2.2(a) Commentary, pp. 29-30.
. A cautionary instruction was given to tlie jury as well: "If by any chance you feel that this court has intimated any opinion as to what I think the facts are, which I don't believe I have done, you are to disregard any intimation that you may have got from anything I said. I reiterate, you and you alone are the sole and the exclusive judges of the facts."