Before L. HAND, AUGUSTUS N. HAND, and CHASE, Circuit Judges.
The appellant was tried by jury in the District Court for the Southern District of New York on an indictment in one count charging a violation of 18 U.S.C.A. § 231, i.e., charging perjury. He was convicted and sentenced to imprisonment for a year and a day and to pay a fine of $2000. His appeal raises questions as to the sufficiency of the evidence to establish all the elements of the crime by the necessary quantum of proof. It also calls for decision as to the effect of the appellant's introduction of evidence by way of defense on the merits after he had moved at the close of the government's case to dismiss the indictment for lack of proof and the motion had been taken under advisement by the court.
The perjury charged in the indictment was that appellant, David Goldstein, while being examined under oath administered by a duly authorized special agent of the United States Treasury Department in a proceeding to determine the tax liability of American Coated Fabrics Co., Inc., Aetna Coated Fabrics, Inc., David Rosen, Sydney Drooker, and the appellant himself, willfully testified falsely to matters material to the proceeding. His allegedly false testimony was, it was charged, "That stock certificates numbered 5, 6, 7 and 8 of the Aetna Coated Fabrics, Inc., of 30 East 20th Street, New York City, were issued in his name on October 2, 1941; whereas in truth and in fact, as the said David Goldstein then and there well knew and believed the said stock certificates numbered 5, 6, 7 and 8 of the Aetna Coated Fabrics, Inc., of 30 East 20th Street, New York City, were issued in his name subsequent to March 23, 1945."
The following undisputed circumstances which the tax investigation disclosed will show how the time when the above stock certificates were issued was significant. In August, 1945, when treasury agents were investigating the tax liability of the American Coated Fabrics Co., Inc., and that of Drooker and Rosen, its owners, certain duplicate invoices of Aetna Coated Fabrics were found in American's possession. These led the agents to suspect that Drooker and Rosen owned an interest in Aetna and might have received therefrom taxable income which they had failed to report on their returns. The investigation, therefore, was broadened to include the tax liability of Aetna and of the appellant, who was its president.It appeared that the appellant had been employed in 1937 by Drooker and Rosen to manage Aetna, which they had organized as a corporation with 750 authorized shares of capital stock, only 75 shares of which had been issued. The stockholders, appellant told the agents, were nominees of Drooker and Rosen, one Hillson having a certificate of 25 shares, one Shaw having one of 25 shares, and appellant having two of 12 1/2 each. The nominees all indorsed their certificates in blank and the certificates were in the possession and control of Drooker and Rosen thereafter at least until October 2, 1941. Some time before that date the appellant had been made president of Aetna and until the fall of 1940 had been paid for his services a weekly salary ranging up to perhaps $100.But late in 1940 commissions on the gross sales of Aetna were credited to him on the books and he may have withdrawn some of them in addition to his weekly salary. By the fall of 1941 his salary had been substantially increased and commissions of 5% on the gross sales of Aetna were credited to him on the books. At irregular intervals he withdrew parts of this credit by checks drawn on Aetna. Each time the checks were cashed by or in behalf of the appellant, he turned over the greater part of their amounts to Drooker and Rosen. This practice was followed throughout the taxable years under investigation. The commissions so credited were deducted as business expenses by Aetna on its income tax returns and were reported by the appellant on his and the tax paid, but the part received by Drooker and by Rosen was unreported by them.
With this background the special agents suspected that the amounts received by Drooker and Rosen were in fact secret dividends upon which they were taxable and that at least that part of the commissions were not deductible as business expenses by Aetna. The explanation of the appellant for his division of commissions with Drooker and Rosen was in effect that in the fall of 1940 he felt that his management of Aetna entitled him to more remuneration than he had been receiving and that he ought to be allowed to purchase some of its stock. He talked with Drooker and Rosen and in January, 1941 the three came to an oral understanding substantially as follows. The appellant's salary was increased and he was given a five per cent commission on Aetna's gross sales. He was then to purchase one-third of the issued shares of Aetna for which he agreed to pay Drooker and Rosen two-thirds of the commissions after taxes for a period of five years, but he was not to receive the shares until the end of that period. Thus, the portions of each withdrawal of his commissions which he had shared with them were, he said, the payments he had agreed to make for the Aetna stock.
This explanation of the disposition of his commissions was not taken at face value and the special agents asked the appellant to produce Aetna's stock book. After some delay it was produced and turned out to be a loose-leaf binder with blanks not printed for use by any particular corporation. The first four certificates issued in 1937 as above indicated had been marked cancelled and attached to their stubs with staples. Following in the book were the stubs of certificates Nos. 5, 6, 7, and 8 showing that all these four certificates had on October 2, 1941 been issued in the name of the appellant, Nos. 5, 6, and 7 each being for twenty-four shares and No. 8 for three shares. The book was delivered to a special treasury agent early in November, 1945 by an accountant employed by Aetna who had with him United States transfer tax stamps to put on the stubs of Nos. 5, 6, 7, and 8, there being no transfer stamps upon them, but he was denied permission then to affix the stamps.
During the proceedings above mentioned at which the appellant was interrogated under oath, he testified positively that all of the certificates numbered 5, 6, 7, and 8 had been issued on October 2, 1941 and that he had signed each certificate on that date as president of Aetna. He also testified that Drooker and Rosen were present when all these certificates were issued and that all the shares were then put in his name merely for the business purposes which had before been fulfilled by having the stock in the name of dummies, viz., to prevent the trade from knowing that Drooker and Rosen owned Aetna. It was thought, so appellant testified, that to transfer all the stock to the appellant would better serve the purpose of secrecy than to let some shares remain in the names of Hillson and Shaw.
At the trial below the prosecution, among other things, proved the above in substance and introduced evidence tending to show that, although the appellant had included the commissions withdrawn from Aetna in his gross taxable income and had paid the taxes thereon, the treasury would have been entitled to a greater tax if the tax liabilities of Aetna, Drooker, Rosen, and the appellant had all been computed on the theory that the amounts received by Drooker and Rosen were dividends paid to them as stockholders of Aetna. To show that certificates Nos. 5, 6, 7, and 8 had not been issued on October 2, 1941 but had been issued after March 23, 1945, Belskin, an employee of the New York State Department of Finance and Taxation, testified that on the latter date a representative of Aetna brought the stock book to his office for examination and that he then examined the book for the purpose of determining state tax liability. He also in the usual and regular course of the business of the state office then made a record on a card, provided for that purpose, showing the result of his examination. This card was duly filed as a part of the records in the office and was admitted in evidence in corroboration of the testimony of this witness. It gave substantial support to his testimony which was to the effect that at the time he inspected the stock book it contained only the stubs of certificates Nos. 1, 2, 3, and 4. Aside from those stubs, his testimony ran, the book showed no evidence of any certificates having been issued, the remaining pages all having been blanks.
The government rested upon the case thus made, with Belskin's testimony corroborated only by the record in his office that he himself had made substantially as above outlined. The appellant then moved for a dismissal on the ground that no prima facie case of perjury had been shown in that no false statement by the appellant of any fact material to the investigation had been proved and on the ground that in any event the testimony of the witness Belskin was not sufficiently corroborated to comply with the so-called two-witness rule in perjury cases. That rule is that the offense must be proved either by the direct testimony of two witnesses or by that of one witness supplemented by proof of corroborating circumstances. See Weiler v. United States, 323 U.S. 606, 65 S. Ct. 548, 89 L. Ed. 495, 156 A.L.R. 496; 7 Wigmore on Evidence, 3rd Ed., § 2042.
The judge reserved decision on the motion and the appellant introduced evidence tending to show the following defense on the facts. Certificates Nos. 5, 6, and 7 had actually been issued on October 2, 1941 but through an oversight the aggregate number of shares they represented was only 72 out of the intended total of 75. It had been decided to put all of the stock in the appellant's name in 1941 and the mistake was not discovered until sometime in the fall of 1945. Then certificate No. 8, for the three shares not accounted for in the three preceding certificates, was typed in the office of Aetna's attorney and signed by the appellant after it had been pre-dated to October 2, 1941. During the defense's presentation of evidence, appellant's wife, Aetna's attorney, and both Drooker and Rosen were called and testified. From parts of their evidence the jury could have found that the four original certificates, Nos. 1, 2, 3, and 4, were in the possession of Drooker and Rosen when the agents began making their investigation and were not marked cancelled and attached to their corresponding stubs in the stock book until after the agents had demanded the production of that book; that the stubs of certificates Nos. 5, 6, 7, and 8 were not filled out until after the production of the stock book had been requested; and that Goldstein had not been accurate in some of the statements he made to the agents as to who was present in 1941 when the certificates were issued or as to who had then received them. At the close of all the evidence, the motion to dismiss was renewed and decision upon it was again reserved. The case was submitted to the jury and after its verdict the motion to dismiss was denied and judgment was entered on the verdict.
It is clear and indeed is conceded by the appellant that before Rule 29 of the Federal Rules of Criminal Procedure, 18 U.S.C.A. following section 687, became effective his motion to dismiss made at the close of the government's case would have been waived by his election to defend on the merits and his introduction of evidence to that end. Bogk v. Gassert, 149 U.S. 17, 13 S. Ct. 738, 37 L. Ed. 631; Epstein v. United States, 2 Cir., 271 F. 282. But the new Rule 29 provides:
"(a) Motion for Judgment of Acquittal. * * * The court on motion of a defendant or of its own motion shall order the entry of judgment of acquittal of one or more offenses charged in the indictment or information after the evidence on either side is closed if the evidence is insufficient to sustain a conviction of such offense or offenses. * * *
"(b) Reservation of Decision on Motion. If a motion for judgment of acquittal is made at the close of all the evidence, the court may reserve decision on the motion, submit the case to the jury and decide the motion either before the jury returns a verdict or after it returns a ...