United States v. Harry Seidman

156 F.3d 542, 159 L.R.R.M. (BNA) 2211, 1998 U.S. App. LEXIS 21924, 1998 WL 574761
CourtCourt of Appeals for the Fourth Circuit
DecidedSeptember 9, 1998
Docket97-4075
StatusPublished
Cited by345 cases

This text of 156 F.3d 542 (United States v. Harry Seidman) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fourth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States v. Harry Seidman, 156 F.3d 542, 159 L.R.R.M. (BNA) 2211, 1998 U.S. App. LEXIS 21924, 1998 WL 574761 (4th Cir. 1998).

Opinions

Affirmed by published opinion. Judge WILLIAMS wrote the opinion. Judge MICHAEL wrote a separate opinion concurring in parts I, II and IV and the judgment. Senior Judge KISER wrote a separate opinion concurring in part and dissenting in part.

OPINION

WILLIAMS, Circuit Judge:

Harry Seidman was convicted on September 26, 1997, on one count of conspiracy to embezzle funds from a labor union, see 18 U.S.C.A. § 371 (West Supp.1998) and 29 U.S.C.A. § 501(c) (West 1985), and on twelve counts of embezzlement from a labor union, see 29 U.S.C.A. § 501(c) (West 1985), or aiding and abetting the same, see 18 U.S.C.A. § 2 (West 1969). The district court sentenced Seidman to thirty-nine months imprisonment on each count, the sentences to run concurrently, and imposed a fine of $30,000. Seidman appeals his convictions on two grounds: (1) that the district court erred in denying his motion to suppress a tape-recorded conversation; and (2) that the district court’s instructions on 18 U.S.C.A. § 2 were improper. Because we conclude that the district court properly denied the suppression motion and correctly instructed the jury on aiding and abetting, we affirm Seidman’s convictions.

I.

Seidman was employed by the International Organization of Masters, Mates, and Pilots (the Union), a labor union headquartered in Linthicum, Maryland,1 from the 1950s until December of 1993. Seidman eventually became the Comptroller for the Union. His responsibilities as Comptroller included paying the Union’s bills, administering the Union office on a day-to-day basis, and obtaining annual financial audits. Seidman was personally authorized to sign checks on the Union’s behalf. Although the Secretary/Treasurer, James T. Hopkins, Jr., was the chief financial officer of the Union, a major portion of the Secretary/Treasurer’s time was devoted to handling contract grievances for Union members. The Secretary/Treasurer did not review invoices submitted to the Union or checks signed by Seidman on behalf of the Union.

When Timothy Brown became President of the Union in April of 1991, the Union was in poor financial condition. In 1992, Seidman informed Brown that Seidman had cashed the last of the Union’s cash reserves which had been held in million dollar certificates of deposit. Approximately five to six percent of the Union’s total expenditures, or $30,000 a month, were incurred by the Union-published monthly newspaper. In the fall of 1992, Brown decided to print the newspaper on a bimonthly basis to reduce costs.

Ronald Schoop was an independent contractor who provided printing services to the Union through the corporate entity “Mercury Graphics” from approximately 1978 to October 1993. Initially, Schoop provided general printing services, including business cards, envelopes, and wall calendars. During 1985, Schoop began printing the Union newspaper. In October of 1993, Schoop briefly became an employee of the Union until his resignation in December of 1993 when a scheme of embezzlement between Seidman and Schoop was discovered.2 Schoop had an office located in the Union headquarters, but no printing services were actually performed at the Union office. To obtain payment for his printing services, Schoop submitted bills to the Union which were paid by Seidman. In late May of 1993, Beverly Gutmann, the Un[545]*545ion’s Assistant Comptroller, informed Brown that there had been a potential double billing for the Union newspaper. Brown questioned Seidman about the possible double billing, and Seidman responded that the additional charges were for editorial changes that Brown had made in a recent issue of the paper. Brown did not question Seidman’s answer because he had substantially rewritten large sections of that edition of the paper.

When Brown later inquired about the expenses associated with producing the newspaper during the summer of 1993, Seidman responded that the cost of the newspaper had not decreased even though the paper was being published bimonthly instead of monthly. Brown was not satisfied with Seid-man’s explanation of the expenses associated with publishing the newspaper. He became even more suspicious in November of 1993 when Gutmann approached him again about double charges for Schoop’s printing services for the December 1992/January 1993, February/March 1993, and May/June 1993 editions of the Union newspaper. Gutmann told Brown that she believed Seidman and Schoop were -embezzling funds from the Union.

Because of these mounting suspicions of financial impropriety, Brown hired an outside forensic auditor, Gunther Borris, to perform an audit. On December 24,1993, Borris met Brown and Hopkins, the Secretary/Treasurer, at the Union office. Borris spent the entire day reviewing the Union’s financial records, particularly the potential double billings for the Union newspaper. As a result of Borris’ investigation, Brown learned for the first time that checks had been issued to Ronald Schoop personally for invoices submitted by Mercury Graphics and that 1099 forms had not been issued to Schoop.3 Bor-ris also confirmed that there had been at least two double billings for the Union newspaper.

On December 28, 1993, Borris submitted his financial report at a meeting of the International Subcommittee, a group of five individuals charged with managing the affairs of the Union during time peri ods between meetings of the General Executive Board. During the meeting, Seidman and Schoop were questioned about the allegations of double billings. As a result of Borris’ audit and the December 28 meeting, the Subcommittee asked Seidman for his resignation. Seidman signed a resignation letter on December 28, 1993. Ronald Schoop, who was at that time a salaried employee of the Union, resigned one day later.

In March of 1995, Schoop confessed to agents of the Department of Labor’s Office of Labor Racketeering to conspiring with Seidman to embezzle funds from the Union and agreed to. participate as a government informant. In that capacity, Schoop made two recorded telephone calls to Seidman, on March 9, 1995, and March 21, 1995. Schoop agreed to go to Seidman’s residence wearing an electronic recording device and record a conversation with Seidman on May 23, 1995. Upon arriving at Seidman’s residence, Schoop knocked on Seidman’s door approximately ninety times. When he received no answer, Schoop opened the unlocked door and saw Seidman in the hallway near the door. When Schoop asked Seidman what he was doing, Seidman responded that he had been riding his exercise bicycle in the basement and closed the door to the basement, as if he had just come upstairs. Seidman led Schoop to the kitchen where the two proceeded to have a conversation for the next forty-five minutes.4

[546]*546II.

On May 14, 1996, Seidman was charged in a thirteen count indictment with one count of conspiracy to embezzle funds from a labor union and twelve counts of embezzlement from a labor union or aiding and abetting the same. The indictment alleged that Seidman conspired with Schoop from approximately 1987 to July 1993 to embezzle approximately $800,000 in a complicated kickback scheme by “directing” or “causing” Schoop to submit fraudulent invoices for services from Mercury Graphics and other corporate entities.

A two-week trial was held in September of 1996. Schoop testified that he and Seidman participated in a kickback scheme.5

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Cite This Page — Counsel Stack

Bluebook (online)
156 F.3d 542, 159 L.R.R.M. (BNA) 2211, 1998 U.S. App. LEXIS 21924, 1998 WL 574761, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-v-harry-seidman-ca4-1998.