Russell v. United States

12 F.2d 683, 4 Ohio Law. Abs. 585, 1926 U.S. App. LEXIS 3338
CourtCourt of Appeals for the Sixth Circuit
DecidedMay 14, 1926
Docket4473-4475
StatusPublished
Cited by12 cases

This text of 12 F.2d 683 (Russell v. United States) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Russell v. United States, 12 F.2d 683, 4 Ohio Law. Abs. 585, 1926 U.S. App. LEXIS 3338 (6th Cir. 1926).

Opinion

KNAPPEN, Circuit Judge.

Plaintiffs in error were jointly indicted, together with seven other defendants, upon charges of conspiracy under section 37 of the Penal Code, being Comp. St. § 10201 (by the first count) to withdraw from a distillery warehouse, and sell for beverage purposes, a large amount of whisky legally withdrawable for nonbeverage purposes only, and under such conspiracy to commit divers offenses against the United States of unlawfully possessing, transporting, accepting, receiving, and selling such whisky; and (by the second count) to defraud the United States of upwards of $90,000 by way of additional taxes of $4.20 per gallon to which the government would be entitled upon sale for beverage purposes. From about September 1, 1921, plaintiff in error Russell was prohibition director of the state of Ohio, with offices at Columbus. From September 15, 1921, plaintiff in error Copeland was prohibition agent under, and executive clerk of,'Director Russell, and in charge of permits. Plaintiff in error Barnett was an attorney living and doing business at Columbus, Ohio. Another defendant (Gross-berg) acquired warehouse receipts for 22,416 gallons of whisky deposited in the Hayner Distillery Warehouse at Troy, Ohio, which was subject to withdrawal for nonbeverage purposes only. Another defendant (Gardos) was president of the Armand Drug & Candy Company, of Cleveland, Ohio (hereinafter called the.drug company), which had a basic permit to procure and sell distilled spirits in connection with its business, to others holding permits to purchase and use the same for such purposes. One Abe Ungerleider, a broker, was alleged in the indictment to have been a party to the conspiracy, but not indicted because of having testified before the grand jury concerning matters charged in the indictments. Each of the seven defendants other than the three plaintiffs in error pleaded guilty. Grossberg and Gardos, as well as Ungerleider, testified for the government. Each of the plaintiffs in error was convicted on both counts, and sentences were imposed accordingly. A brief reference to the nature of the testimony and the contentions of the parties should be helpful to a discussion of the alleged errors relied upon for reversal.

The government’s testimony was to the *685 general effect that between November, 1921, and May, 1922, by virtue of the alleged conspiracy, about 22,000 gallons of whisky were withdrawn for pretended nonbeverage purposes from the Hayner Distillery upon Grossberg’s warehouse receipts, under applications in the name of the drug company, prepared by Grossberg on form 1410, and founded upon the drug company’s basic permit before referred to; that these applications were delivered by Grossberg (all under authority from Gardos) to Ungerleider and by the latter to plaintiff in error Barnett; that the permits to the drug company to make purchases, issued by plaintiffs in error Russell and Copeland, one or both, on form 1410-A, were in turn delivered personally by Barnett to Ungerleider and by him to Gross-berg, who then obtained the whisky from the distilling company, and caused it to be turned over at the drug company’s warehouse to defendant Higgins, who gave Grossberg payment therefor; the latter delivering it to Ungerleider, who paid plaintiff in error Barnett, on each occasion, a large sum of money on account thereof. The testimony is to the effect that Higgins bought the whisky for bootlegging purposes, paying more than $500,000 therefor. Ungerleider testified to statements by Barnett to the effect that Russell had been appointed prohibition director as “my [Barnett’s] party”; also that Copeland and others were receiving part of the money delivered to Barnett by Ungerleider. In the brief of plaintiffs in error Russell and Copeland, it is said:

“There is no doubt that there was a conspiracy of the general character described in the indictment, and that the defendants other than Russell, Copeland, and Barnett were parties thereto; the question of fact to be decided by the jury in this case being whether Russell, Copeland, and Barnett were also involved as coconspirators with those who have admitted their guilt. And there is no doubt that about 22,000 gallons of Hayner whisky were withdrawn from the distillery at Troy, transported to Cleveland and thence to Youngstown and elsewhere; such withdrawals being made upon applications filed by the Armand Company by virtue of its basic permit for the years 1921 and 1922. It is conceded also by the defendants Russell and Copeland that the liquor was withdrawn while they were in charge of the prohibition office, and that the withdrawal permits therefor were approved by them or either of them acting in their official capacities. e‘ * '* It is the contention of Russell and Copeland that the liquor was withdrawn by the Armand Company upon withdrawal permits under the basic permit in accordance with, the law upon the subject, and that they both and each of them had no knowledge whatsoever that the liquor was to be used for illegal and beverage purposes. * 8 * >r

Barnett denied all connection with the conspiracy or with the liquor transactions in question, and disputed the testimony of Abe Ungerleider practically in toto.

There was a large amount of documentary and other evidence strongly tending to show that Russell and Copeland were parties to the conspiracy. T. D. No. 3208, effective August 15,1921 (15 days before Russell’s incumbency and 30 days before Copeland’s) limited the amount of potable liquor — not including high proof alcohol— which a wholesale druggist might withdraw in any month to 10 per cent, of the average monthly amount in money of bona fide business done by such druggist, exclusive of the sale of intoxicating liquors, during the preceding quarter, and, to effectuate such limitation, required the filing by such company of monthly reports of the amount of its business other than liquor and of the sales of liquor during the preceding month. Reports of neither of these classes seem to have been made by or required of the Armand Drug & Candy Company during the period in question. The drug company had not, for some time at least before the conspiracy period, been withdrawing whisky, but had been withdrawing alcohol in comparatively small amounts.

The claim of Russell and Copeland that their first knowledge of T. D. No. 3208 was late in 1921 or early in 1922 is disputed as to the 10 per cent, limitation by documentary evidence of official notice from the office of the prohibition commissioner of September 7, 1921 (acted upon by the defendant Russell), to restrict withdrawals of another drug company, to the 10 per cent, allowed by T. D. No. 3208. Other documentary evidence, as well as oral testimony, tends to support the same conclusion. There was also oral testimony that Russell had personal knowledge of these large withdrawals by the drug company (by virtue of T. D. No. 3208); his attention having been by an employee (Mrs. Guerin) directly challenged thereto 1

*686 In connection with the assertion by Russell and Copeland of lack of knowledge, until the time above stated, of the 10 per cent, limitation in T. D. No. 3208, it was their contention that, in the absence of a specific limitation in the basic permit for the year, Regulation 60 had allowed the withdrawal in any quarter of the number of gallons found by dividing thq penalty of the bond by 4.2Q, and that such withdrawal was not exceeded.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Lewis v. IRS
E.D. California, 2022
Shen v. LaCour
D. Nevada, 2019
In Re Zisook
430 N.E.2d 1037 (Illinois Supreme Court, 1981)
Beck v. United States
140 F.2d 169 (D.C. Circuit, 1943)
Wilson v. United States
107 F.2d 253 (D.C. Circuit, 1939)
United States v. Meltzer
100 F.2d 739 (Seventh Circuit, 1938)
Mancusco v. United States
27 F.2d 322 (Sixth Circuit, 1928)

Cite This Page — Counsel Stack

Bluebook (online)
12 F.2d 683, 4 Ohio Law. Abs. 585, 1926 U.S. App. LEXIS 3338, Counsel Stack Legal Research, https://law.counselstack.com/opinion/russell-v-united-states-ca6-1926.