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United States v. Compagna

December 20, 1944


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

Author: Hand

Before L. HAND, SWAN, and CLARK, Circuit Judges.

L. HAND, Circuit Judge.

Compagna and six others have appealed from convictions for violation of subdivision (d) of § 420a, Title 18 U.S.C.A.: a conspiracy to extort money from producers and exhibitors of moving pictures during the years 1935 to 1940. They rely upon some twenty assignments of error, of which the first and the most important is that there was not enough evidence to support the verdict. Since the case against Kaufman is somewhat different from that against the rest, we will reserve consideration of his appeal until we have disposed of those of the others. The only other alleged errors of any consequence concern the general conduct of the trial: e.g., the admission of supposedly incompetent evidence, the judge's charge, the prosecutor's misconduct, and the fact that the judge spoke to the jury out of court after they had retired. For a discussion of the constitutionality of the statute - also an assigned error - we need only refer to Nick v. United States, 8 Cir., 122 F.2d 660, 138 A.L.R. 791.

To an intelligent understanding of the appeal, it is necessary to give an outline of the general venture in which the accused were involved, as the jury might have found it from the testimony. The fabric of this was woven out of the testimony of two accomplices - Bioff and Browne; particularly that of Bioff, a man with a long, discreditable and criminal past, confessedly guilty of perjury in an earlier examination of the same transactions here in question. Their story was in substance as follows. Browne had been a member and business agent for the Chicago local of an international trade union of stage hands and moving picture machine operators, which covered the United States and Canada. In 1932 he ran for president of the union and was defeated. Shortly thereafter he met Bioff, who already knew the accused and others of their kind and had engaged in illicit operations with them. The record does not definitely disclose the nature of the original association of these two men, but a jury might find it too to have been illicit. In any event, they made more money than they had been used to having and spent it freely enough to attract the attention of one Circella, who kept a night club in Chicago, and who was one of a group, or gang, of confederates who lived by blackmail. The cupidity of these men became aroused by this news; and, after preliminaries unnecessary to detail, they forced upon Browne and Bioff an agreement by which they should receive, first one-half and, later two-thirds of all that the two might collect from moving picture exhibitors. Among the confederates were, not only the appellants here, but a number of others - among them, Circella, already mentioned. The first step was to elect Browne president of the union, in which they succeeded. Circella and Bioff were then given offices in the union as personal representatives of Browne, as president, and both drew salaries. Early in 1935 all had been arranged, and Bioff and Browne, who were to be the spearheads, began to blackmail exhibitors of moving pictures in Chicago. So far as appears, they did not expressly threaten violence, but confined themselves to a pretence of union activity; that is, they threatened to call strikes against their victims unless they were plentifully paid. Among their earliest victims was an exhibitor in Chicago, one Barger, who operated a small theatre, and whom Bioff forced to share equally with him all Barger's profits. Later, by the same pressure, Bioff imposed upon this unfortunate man as employees: first, Maritote, and later, D'Andrea, neither of whom rendered any services whatever, but who were paid $175 a week and later, $200. By the autumn of 1935 the enterprise had apparently become so profitable that Bioff extended it to New York. One Basson was the local agent of the New York local, and had undertaken negotiations for a wage increase with some large exhibitors in that city, with the threat of a strike as a sanction; but Bioff, speaking for Browne, without whose consent no strike was regular, intervened and upon the payment of $150,000 from the exhibitors collectively, refused to permit the strike.

Until the beginning of 1936, the collections had all been from exhibitors, either in Chicago or New York, but early in that year the group decided to include producers, who, as is well known, produce films for the most part in California. It had been the custom of the industry to have an annual meeting each year in New York between representatives of the various unions in the industry and of the producers; and in 1936 Bioff went to this meeting and met Schenck, a representative of a large producer. Bioff threatened to close up the theatres of exhibitors throughout the country unless Schenck could raise a very large sum from the producers generally. After some higgling, the two finally agreed upon a schedule, or tariff, by which the larger producers were each to pay annually $50,000; and the smaller, $25,000. The group found the threat of a strike against the theatres more effective a sanction than a strike against the producers themselves; for, by stopping the outlets they could entirely paralyze the production of films. The arrangement so concluded lasted almost until the indictment was filed on March 18, 1943, and resulted in the collection of over $600,000, in addition to nearly $500,000 collected from exhibitors.

The evidence connected all the accused now at bar with this undertaking, although for the most part this was through the testimony of Bioff, corroborated in some degree by Browne. As is so often the case in criminal appeals, we are asked to reverse the conviction because the testimony on which the verdict was based was incredible; as always, we reply that that question is not for us, but for the jury. If, viewing the situation as a whole, they chose to believe Bioff, their conclusion was final. Coming to the individuals separately, nothing need be said about Compagna; Bioff connected him with the venture in the most direct way; apparently he was the chief. To deLucia Bioff repeatedly paid part of the blackmail; and, on occasion, he did the same to Gioe, though not so often. Circella introduced Rosselli to Bioff as the representative of the group in California; Bioff arranged to pay him a part of the money extracted from the producers in that state, though the payments were disguised by bookkeeping designed to hide the nature of the transaction. As we have already said, Maritote and D'Andrea were given sinecures in the business of Barger, at weekly payments of from $175 to $200. It was impossible to doubt - nothing being shown to the contrary - that men, receiving such payments in such a way, were privies to the scheme. They could not have supposed that they were bona fide employees of Barger; nor is it tenable to assume that a ruthless and grasping crew of blackmailers would provide soft berths for subordinates who were ignorant of the general nature of the undertaking of which they were the beneficiaries. We start therefore with the hypothesis that all of the accused now at bar were parties to a blackmailing conspiracy of wide scope, long duration, and vast returns.

It is apparent that such a conspiracy was within the statute, provided that the threats used to extort the money were "coercion," as defined in subdivision (a) of § 420a; and provided further that the extortion was "in connection with" an act "affecting" interstate commerce. To take up the second point first, it was enough proof of the effect of their acts upon interstate commerce, that the group found it more effective, when they were blackmailing the producers, to threaten them with a strike against the theatres. Nothing could more completely illustrate the unity of the whole industry; all its parts were like those of a single elastic member in which an impact upon one part is instantly transmitted everywhere. Moreover, not only would the producers feel the check upon the interstate movements of their films when the exhibitors were tied up; but since many of the exhibitors did business on a small margin, and must have a constant supply of films to keep going at all, a very short cessation of that supply at the sources might destroy them, and end them forever as outlets. If these were the facts, the business was interstate as matter of law, and the question should not have been submitted to the jury; and since nobody contested the facts, but only their legal effect, it was unnecessary for the judge to say anything on the issue. Coming back now to the first of the questions we just put, the accused "coerced" exhibitors and producers, if it was "coercion" to threaten them with strikes. The statute does not, indeed, make it a crime to force a rise in wages by such a threat; the twice expressed exception that it shall not apply to the payment of wages would alone prove that, as indeed would the general purpose to be drawn from the whole. But if the accused at bar were not concerned in any wage dispute, but threatened to call strikes, not in the interest of the workmen, but to feather their own nests, they "coerced" their victims within the meaning of the section. The judge should have left to the jury nothing more than he did.

The indictment having been filed on March 18, 1943, it was necessary to show that it continued until March 18, 1940, and there was evidence in plenty that it did, although several of the accused were not shown to have continued their connection with it as late as that. To meet this lapse in the evidence as to them, the prosecution invoked the well established doctrine that anyone, once shown to have been a member of a conspiracy which lasts until the beginning of the statutory period, must satisfy the jury by affirmative proof that he disconnected himself from it before that period began. So the judge charged, and he was quite right; we have so lately affirmed such a ruling that we need only refer to the authorities on which we then relied. United States v. Cohen, 2 Cir., 145 F.2d 82, 90.

We do not find it necessary to discuss the several alleged variances between the indictment and the proof; neither cumulatively, nor in detail, could they have misled the defence; the substance of the charge and the proof were in entire accord. All the accused and a number of others were engaged in a single enterprise, understood by all to be such: a common engagement to prey upon the fears of producers and exhibitors wherever there was a likely opening. It is curious that today in the face of § 556 of Title 18 U.S.C.A., it should still be supposed that we would concern ourselves with the trivial challenges to the indictment which are here put forward as a ground for reversal. The same is true of most of the assigned errors, touching the judge's rulings upon evidence and his charge. With one exception which we shall take up in a moment, these were of no importance; and would not even have been of importance, had the result been less inevitable than it was. We shall not consider the others in detail, but content ourselves merely by referring to § 391 of Title 28 U.S.C.A.

Two questions do arise, however, which seem to us to require an answer. After the jury had been locked up, they sent out a note, asking that Barger's testimony against D'Andrea should be read to them; and the judge, who had apparently left the court room, on his way back to it "stopped in the jury room and asked them if that is what they meant about that, if they wanted it read. They said yes. I told them they could go to lunch and we would get it ready and read it to them when we came back." The testimony was read to them after lunch, not including the cross examination, which they apparently did not want to hear. At any rate, since the accused did not ask to have it read, they are in no position to complain of the omission. As to the visit of the judge, it is true that courts are extremely jealous of anything of the kind, once the jury has been locked up; and we do not wish to abate that jealousy in the least; it is most undesirable that anything should reach a jury which does not do so in the court room. This is, indeed, too well settled for debate. Mattox v. United States, 146 U.S. 140, 150, 13 S. Ct. 50, 36 L. Ed. 917; Fillippon v. Albion Vein Slate Co., 250 U.S. 76, 81, 39 S. Ct. 435, 63 L. Ed. 853; Dodge v. United States, 2 Cir., 258 F. 300, 303, 304, 7 A.L.R. 1510; Little v. United States, 10 Cir., 73 F.2d 861, 864, 865, 96 A.L.R. 889. But, like other rules for the conduct of trials, it is not an end in itself; and, while lapses should be closely scrutinized, when it appears with certainty that no harm has been done, it would be the merest pedantry to insist upon procedural regularity. Dodge v. United State, supra, 258 F. 300, 7 A.L.R. 1510; Rice v. United States, 2 Cir., 35 F.2d 689, 696; United States v. Graham, 2 Cir., 102 F.2d 436, 444. There cannot be the slightest doubt here that the informality - for, at most, it was no more - did not prejudice the accused.

There remains only one question, as to the method of dealing with which my brothers and I are not in entire accord, though we agree in the result. During the trial the prosecution called a number of exhibitors or producers who testified that Bioff threatened to call strikes in their theatres or film studios, if they would not comply with his demands. As we have already said, he did not threaten them with violence, but the judge allowed the prosecutor to ask whether, when they paid the blackmail, they had been moved by fear of violence; and in a number of instances they said that they had. Moreover, they were further allowed to say what their fears had been: i.e., that during other strikes there had been stoppages of film machines in the middle of a performance; stink bombs had been set off in the theatres; members of the audience and recalcitrant exhibitors had been assaulted. Against all this testimony the accused vigorously protested at the time, and they particularly press its admission upon us now as error.

If the indictment had charged the substantive crime of extorting money by "coercion," there would, we all think, have been no doubt of the relevancy of such testimony; it would have been necessary in that case to prove that the "coercion" had induced the payments, as to which the victims would obviously have been the best source of information.They would know why they paid the money, and, the issue once open, no prosecutor should be limited to the bare statement that the threat had been the motive; the victim would be allowed to show in detail just what fears the threat aroused in him. Since, however, the crime was a conspiracy, and not the crime of blackmail itself, we all agree that it was not necessary for the prosecution to prove that the conspiracy was successfully executed: that is, that any money had been in fact "obtained." My brothers think that, even so, it was relevant to show that the scheme proved successful as part of the proof that there had been a scheme at all. They believe that there is a rational connection between the existence of the criminal agreement - the "partnership in crime" - and the fact that the acts upon which the conspirators agreed, when carried out, had the expected effect upon those against whom they were directed. They further believe that, even if this connection be not perfectly faultless in logic, the distinction is too formal and too fine drawn to be treated seriously, and that we should not strain to enlarge its importance. For these reasons they believe that we should hold that it was not an error at all to admit the testimony.

It seems to me, on the other hand, that the only evidence relevant to the existence of a conspiracy are facts which come, or at least might have come, to the knowledge of the conspirators, among which, obviously, the undisclosed mental states of mind of the victims in the case at bar could not be. What they told Bioff of their reasons for paying him was of course relevant, for it would be part of the nexus of information with which all were charged in the prosecution of their common enterprise; it became a part of their mutual understanding. But I cannot see how what they did not tell, could be relevant. It is difficult to learn from the report of Nick v. United States, supra, 122 F.2d 660 at pages 671, 672, 138 A.L.R. 791 whether that case supports my brother's views; I, at least, am not sure whether the indictment was for the conspiracy - there clearly was one - or the substantive crime. The reasoning seems to indicate that it was for the second; yet the crime is spoken of as a conspiracy. But, although I think that it was an error to admit the testimony, I do not believe that it requires us to reverse the convictions. It might have done so, if the victims had based their fears upon what the accused had done in the past; but the testimony did not in this way covertly convey to the jury an accusation of earlier and independent crimes. Indeed, it did not appear that any of the accused on trial had ever called a strike in the past. (Kaufman may have, but not in Chicago, where these victims did business.) The ...

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