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United States v. Lesser

August 1, 1933

UNITED STATES
v.
LESSER ET AL.



Appeal from the District Court of the United States for the Eastern District of New York.

Author: Hand

Before MANTON, L. HAND, and AUGUSTUS N. HAND, Circuit Judges.

AUGUSTUS N. HAND, Circuit Judge.

Henry Lesser, Forrest E. James, Philip M. Lahn, Walter E. Anderson, and Henry Henners were indicted for conspiring to violate section 2 of the Federal Food and Drugs Act of June 30, 1906 (21 USCA § 2). The indictment against Anderson was dismissed, and the jury found Henners was not guilty. Lesser, James, and Lahn were convicted and have all appealed.

The indictment alleged that the defendants conspired to "introduce, ship and deliver for shipment from one State to another State adulterated and misbranded foods and drugs" and to "sell, transport, deliver and introduce, ship and deliver for shipment from one State to another State, a large quantity of fluid extract of ginger * * * which was then and there adulterated in that it differed from the standard strength, quality and purity of fluid extract of ginger as determined by the tests laid down in the United States Pharmacopoeia. * * *" The indictment also alleged that the defendants were doing business under the fictitious names of Jordan Brothers, S. A. Hall, and Charles M. Pomeroy, and that the conspiracy continued from June 1, 1929, to February 1, 1932.

Section 2 of the Food and Drugs Act (21 USCA § 2) makes any person guilty of a misdemeanor who shall ship or deliver for shipment from any state to any other state "any article of food or drugs which is adulterated or misbranded, within the meaning of sections 1 to 15. * * *" The term "drug" is defined in the act as including "all medicines and preparations recognized in the United States Pharmacopoeia or National Formulary for internal or external use." Section 7, 21 USCA. In section 8, 21 USCA, a drug is defined as adulterated if, when it "is sold under or by a name recognized in the United States Pharmacopoeia or National Formulary, it differs from the standard of strength, quality, or purity, as determined by the test laid down in the United States Pharmacopoeia or National Formulary official at the time of investigation." But it is provided that no drug shall be deemed to be adulterated "if the standard of strength, quality, or purity be plainly stated upon the bottle, box, or other container thereof although the standard may differ from that determined by the test laid down in the United States Pharmacopoeia or National Formulary."

We think that the government introduced evidence at the trial which justified the jury in finding that there was such a conspiracy as the indictment alleged and that all three of the defendants-appellants participated in it.

The defendant Lesser was interested in a flavoring and fruit extract business, having its headquarters at 601 Bergen street, Brooklyn, N.Y., known as the Fulton Chemical Works. It manufactured and supplied fluid extract of ginger and various fruit extracts to customers in many parts of the United States, among others, California Extract Company, Los Angeles, Cal., of which Jacob Rosenbloon, the half-brother of Lesser, was the owner, K. & K. Drug Company, of Newport, Ky., owned by Sol Kauffman, Leo B. Dreyfoos, of Cincinnati, Ohio, and Prescott B. Burkett, who did business under the name of Valo Products Company, Kansas City, Lone Star Company, Dallas, Tex., and American Products Company, Kansas City. From the year 1925 on, Rosenbloom's concern purchased Jamaica ginger extract from the Fulton Chemical Works and in the latter part of 1930 and early part of 1931. Lesser went west to see his half-brother in the latter part of 1929. Just before Rosenbloom ceased to do business in the early part of 1931, the sales were made to him in the names of Jordan Brothers and S. A. Hall. The evidence identified the latter with Fulton Chemical Works. Some of the ginger shipped in the name of Jordan Brothers was found upon a chemical examination to have been adulterated.

Sol Kauffman conducted business under the name of K. & K. Drug Company. He began doing business with the Fulton Chemical Works of 601 Bergen street about 1925 and 1926, and met James, Lesser, Lahn, and Henners at that place. He did business with the same concern in 1929 and the early part of 1930, when he ceased doing business. Fluid extract of ginger was sent to him under invoices of Fulton Chemical Works, Decker Ingraham & Smith, J. Carboy, and S. A. Hall, and he made his checks payable to the order of the person or concern named in the invoice. The orders, however, were given to the Fulton Chemical Works. An invoice dated February 13, 1930, was in the name of S. A. Hall. Kauffman discussed with Lesser the business of fruit extracts and extract of ginger and the prices of goods he had ordered from the Fulton Chemical Works (fol. 1713) during the latter part of the year 1929 when Lesser was in Cincinnati on business. Kauffman said that Lesser was connected with Fulton Chemical Works in 1929 and early in 1930 (fol. 1926).

Dreyfoos, of Cincinnati, testified that he purchased fluid extract of ginger from Lesser, James, and Lahn in 1927, 1928, 1929, and up to the latter part of February, 1930; that he would give orders to Lesser, James or Lahn and, when he sent in written ones, would send them to 601 Bergen street, Brooklyn, the office of the Fulton Chemical Works. Merchandise would be shipped in the names of this company and of S. A. Hall and J. Carboy, and the check would be made out to the person named in the invoice, but the orders would be given to Fulton Chemical Works. Lesser and James were at the Gibson Hotel in Cincinnati in the early part of 1930.

Preston D. Burkett testified that he had had business relations with Lesser, James, and Lahn. He admitted making purchases from Lesser as the Fulton Chemical Works in 1924. He refused to disclose what they were on the ground that to answer might tend to incriminate him, but denied that he purchased extract of ginger from them in 1929 or 1930. On the same ground he refused to say whether he purchased it from S. A. Hall or Jordan Brothers in 1929 or 1930, and likewise refused to say whether he had any correspondence with James in 1929 and 1930. It was, however, shown by another witness named Darnell that he and Burkett, under the name of Valo Products, purchased adulterated ginger extract in 1930 and 1931 from Jordan Brothers and Pomeroy. There was evidence showing those persons were identified with Fulton Chemical Works.

Various other witnesses testified to dealings with Lesser in connection with the Fulton Chemical Works but at dates prior to 1929.

We think that the foregoing proof was sufficient to justify a jury in finding that Lesser continued in the business of the Fulton Chemical Works and of the individuals and concerns allied with it in the sale of fluid extract of ginger in interstate commerce. He offered no proof of severance from the association with the Fulton Chemical Works which had once existed and had continued for years. Though the earliest shipment of adulterated and misbranded fluid extract of ginger established was of the date of December 4, 1930, and the latest connection of Lesser with the conspiracy specifically shown was in February, 1930, it may reasonably be inferred that his proved relation continued in the absence of any evidence to the contrary. The "presumption of continuance," so called, justified the jury in believing that Lesser remained connected with Fulton Chemical Works throughout the period of the conspiracy during which the illegal shipments which were pleaded occurred. Commonwealth v. Fragassa, 278 Pa. 1, 122 A. 88; Easterday v. United States, 53 App. D.C. 387, 292 F. 664; Paterson v. Mobile Steel Co., 202 Ala. 471, 80 So. 855; Cooper & Peabody v. Dedrick, 22 Barb. (N.Y.) 516.

The so-called "Jim" letters written by the defendant James to Preston D. Burkett not only show the connection of James with the conspiracy, but greatly re-enforce the case against Lesser. Exhibit 153, which is apparently dated January 15, 1931, says that Harry "suggested that you destroy all your records as understand they want to try and subpoena them for the cases ...


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