United States v. Leonard Ray Blanton (81-5644), Clyde Edward Hood, Jr. (81-5645), James M. Allen (81-5643)

700 F.2d 298
CourtCourt of Appeals for the Sixth Circuit
DecidedApril 7, 1983
Docket81-5643 to 81-5645
StatusPublished
Cited by30 cases

This text of 700 F.2d 298 (United States v. Leonard Ray Blanton (81-5644), Clyde Edward Hood, Jr. (81-5645), James M. Allen (81-5643)) 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
United States v. Leonard Ray Blanton (81-5644), Clyde Edward Hood, Jr. (81-5645), James M. Allen (81-5643), 700 F.2d 298 (6th Cir. 1983).

Opinion

FLOYD R. GIBSON, Senior Circuit Judge.

Defendants appeal their convictions for acts relating to the issuance of retail liquor licenses in Tennessee during the administration of the former governor of Tennessee, defendant Leonard Ray Blanton.

I. Facts

The three defendants are Blanton, who served as governor of Tennessee from January, 1975 to January, 1979, James M. Allen, who was a special consultant to the governor for the first six months of the Blanton administration and had served as Blanton’s campaign manager, and Clyde Edward Hood, who was a special assistant to the governor from January, 1975 to November, 1977. Defendants were charged on- October 29, 1980, in a twelve-count indictment with eight counts of mail fraud, (18 U.S.C. §§ 2, 1341 (1976)), one count of violating the Hobbs Act (18 U.S.C. §§ 2, 1951 (1976)), and one count of conspiracy (18 U.S.C. § 371 (1976)). Blanton alone was charged with two counts of tax evasion and filing a false tax return. (26 U.S.C. §§ 7201, 7206(1) (1976)). On March 12, 1981, a superseding indictment was issued adding one mail fraud count. The tax counts against Blanton were severed. The essence of the charges was that defendants used their positions to see that friends of Blanton would receive retail liquor licenses from the Tennessee Alcoholic Beverage Commission (ABC) and that one person paid Blanton for receipt of his license.

The most important evidence against defendants was the videotaped deposition of Jack Ham. Ham was an immunized witness who was the recipient of a liquor license during Blanton’s tenure and who allegedly agreed to give Blanton a cut of the profits in violation of state law. Ham had contributed $1,000 to the Blanton campaign.

Blanton’s role in the scheme allegedly was that he directed that liquor licenses be awarded to political friends or persons like Ham who offered a cut of the profits. He allegedly accomplished this by appointing two of the three commissioners of the ABC, including the chairman, S.J. King, and the commission was therefore able to appoint Blanton allies as director and assistant director of the ABC. Blanton allegedly agreed to an illegal twenty percent cut of the profits of Ham’s liquor store, with the payment coming in the form of Ham’s purchase of allegedly worthless oil stock from Blanton for $23,000. 1 (This method of payment resulted in tax savings to Ham.) Blanton also allegedly approved a transfer of Ham’s liquor license to a more lucrative location.

Allen was alleged to have been in charge of determining the awarding of liquor li *301 censes even though he had no position at the ABC. He allegedly helped set up an illegal ownership of a liquor store involving the ABC chairman and he attempted to acquire a concealed interest in a liquor store under the guise of a lucrative consulting contract (only one payment was made under the contract). He allegedly was responsible for hiring a new ABC assistant director to help control the ABC even though Allen was not even a state employee at the time, and he instructed the assistant director to recommend the transfer of Ham’s license to a better location and recommend against the transfer of other persons’ licenses to that area.

Hood allegedly planned to acquire an interest in two liquor stores in contravention of various state laws and he received a share of the profits of some of thé newly licensed liquor stores. He allegedly told the director of the ABC who Blanton’s friends were so that the director would recommend to the ABC that those persons receive licenses. He allegedly helped accomplish the transfer of Ham’s license by talking to ABC chairman King and by suggesting a particular person as the assistant director who would persuade the other Blanton appointee on the commission. Finally, he allegedly suggested that Ham pay Blanton’s share of the profits by buying the worthless oil stock (although he later advised against the purchase).

The scheme violated Tennessee’s laws against an ABC commissioner having an interest in a liquor store, 2 public officials having an interest in a liquor store, 3 undisclosed interests in liquor stores, 4 and bribing of public officials. 5 The federal charge was that the acts (1) constituted a conspiracy to defraud the United States by use of the mails in furtherance of defendants’ scheme to violate Tennessee law (18 U.S.C. § 371), (2) when coupled with mailings, constituted mail fraud by defrauding the citizens of Tennessee of the honest services of their government officials (18 U.S.C. §§ 2, 1341), and (3) violated the Hobbs Act (interference with commerce by threats or violence) (18 U.S.C. §§ 2, 1951).

The testimony of the chief prosecution witness, Jack Ham, was videotaped pursuant to Fed.R.Crim.P. 15(a) because of Ham’s poor health. The videotape was edited and played for the jury at the trial. The government obtained Ham’s testimony offering him immunity from federal prosecution and civil tax liability, and the state agreed not to prosecute Ham. The ABC agreed that it would not revoke Ham’s lu *302 crative liquor license on the basis of truthful statements he made in judicial proceedings.

The trial was preceded by massive publicity about the case in Nashville, Tennessee, and throughout the state, as one would expect in the trial of a former governor. The record contains over 240 articles from Nashville newspapers adverse to defendants. There are approximately 160 articles which appeared in the six months preceding the trial about the instant prosecution, the prosecution of Blanton’s brother, and the prosecution of former Blanton aides. 6 There are more than seventy-five other articles which appeared while Blanton was governor concerning his administration. 7 There are another twenty-two articles on the deposition of Jack Ham, the last of which appeared four months before the beginning of the trial. 8 A large part of the original indictment was published verbatim in the Nashville newspapers. There was also an offer of proof concerning the testimony of news directors of three Nashville television stations about the pretrial publicity.

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Bluebook (online)
700 F.2d 298, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-v-leonard-ray-blanton-81-5644-clyde-edward-hood-jr-ca6-1983.