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July 7, 1964


Author: Waterman

Before LUMBARD, Chief Judge, and WATERMAN and FRIENDLY, Circuit Judges.

WATERMAN, Circuit Judge.

In the first count of an indictment Louis Gladstein and Max Manny Elgisser, along with William James Pitts, James Offie Cogdell, and Edward James Manin, were charged with having conspired, on and after December 1, 1961, to violate Title 18, Section 659 of the United States Code. That section makes it a crime either to steal from an interstate facility goods moving in interstate or foreign commerce, or to receive or possess such goods knowing them to be stolen*fn1 A second count charged Pitts and Manin with the substantive offense of knowingly possessing such goods on December 10, 1961; and a third count charged Elgisser and Gladstein with having committed the substantive offense of knowingly possessing such goods on December 11, 1961. Pitts and Cogdell pleaded guilty before they were brought to trial, and both testified for the Government at the joint trial of Gladstein, Elgisser, and Manin, held in the United States District Court for the Southern District of New York before Judge Thomas F. Murphy and a jury. At the close of the Government's evidence the conspiracy count was dismissed as to all of the defendants, and, none of the defendants desiring to offer further proof, the case then went to the jury on the two substantive counts that alleged knowing possession of stolen goods. The jury found defendant Manin guilty on the second count of the indictment and defendants Gladstein and Elgisser guilty on the third count. The judgments of conviction were entered accordingly.

Defendants Gladstein and Elgisser have appealed from their convictions. Defendant Gladstein claims (1) that the trial court erred in failing to give a charge which properly instructed the jury as to the limited use which could be made of certain evidence, out-of-court statements by the various defendants, which had been admitted subject to connection under the conspiracy count without limitation as to purpose; and (2) that there was insufficient evidence to support his conviction. Defendant Elgisser joins defendant Gladstein in the latter's first claim of error, and he argues further that the court erred in admitting real evidence which had allegedly been seized illegally by the federal agents who arrested him and Gladstein. We find all three claims of error to be without merit and accordingly affirm both convictions.

The Government's evidence consisted largely of the testimony of Pitts and Cogdell and established the following: On Wednesday, December 6, 1961, Manin approached Pitts in a New York gas station where Pitts worked, spoke to him about some dresses which Manin had in his possession, and Pitts offered to try to sell them for Manin. Later that day Pitts contacted Cogdell, who informed Pitts that he would take him to a man that evening who would buy all the dresses Pitts could get. That night the trio met defendant Elgisser and Elgisser purchased twenty dresses from Manin. Either Manin or Pitts also told Elgisser that they could obtain a "load of dresses" but would have difficulty in securing a truck to transport them. Elgisser indicated that he could help them obtain the needed vehicle.

The following day, Thursday, Manin, Cogdell and Pitts drove to a butcher shop owned by Elgisser; and, after Cogdell had talked to Elgisser and had secured the necessary directions, the three drove on to defendant Gladstein's wrecking lot on Boston Post Road in the Bronx. All three went inside, and Cogdell asked to see the owner of the lot. Gladstein then appeared and asked Cogdell, "Are you the fellow?" Cogdell replied in the affirmative, and Gladstein, having just picked up a telephone which had begun to ring, said into it, "Yes, they're here now." Gladstein and his visitors then left the office of the wrecking lot and got into a car which was sitting outside. Gladstein asked about "the load of dresses" which Elgisser had told him about, indicated that he was upset by the fact that Elgisser was involved with the matter, and said that "being as you know him already, there's already been a deal, let it go at that." After discussing with the three their need for a truck, Gladstein showed them a Reo truck with a red cab and blue body which he said he could have ready for them by six o'clock the next evening. Pursuant to this arrangement, the following evening, Friday, December 8, Manin, Pitts and Cogdell returned to Gladstein's wrecking lot for the truck. Gladstein said that the truck ran well, he provided license plates for it, admonished the three to "be careful," and furnished Cogdell with a telephone number to call when the truck was returned to New York. Pitts, Cogdell and Manin then left the wrecking lot in the truck and later that evening Pitts and Manin drove it to Albany.

In Albany, Pitts and Manin failed to make contact with the party from whom they were to obtain the dresses, and they decided to stay in that city overnight. The following evening, Saturday, December 9, Pitts and Manin entered an Albany freight terminal owned by Crowe and Company, Inc., an interstate trucking firm, and took away various cartons containing children's rubber boots, phonograph records and clothing. The two then returned to New York with the load of cartons, arriving back in the city on Sunday morning, December 10. They phoned Cogdell to tell him that they had returned and then met him at the gas station where Pitts worked. Cogdell then called the telephone number which Gladstein had given him; and, pursuant to instructions which he thereupon received from a "Mike" on the other end of the line he, assisted by Pitts and Manin, took the loaded truck to a truck stop at Baychester Avenue and Boston Post Road in the Bronx and left it there.

On Monday, December 11, at about 4:00 P.M., Cogdell stopped at Gladstein's wrecking lot and asked for Gladstein.Gladstein appeared and told him, "California's [Manin's] been here and collected the money, I gave him $500 and - I gave him $500 - well, that's the best I could do." Later that day, between about 5:00 and 5:30 P.M., under circumstances to be described in detail later in this opinion, FBI agents who had been keeping the Reo truck under surveillance arrested Gladstein and Elgisser in the Bronx. Immediately prior to the arrests, Elgisser had been in the body of the truck and Gladstein had been driving it. A search of the truck revealed that it contained miscellaneous goods, including some of the cartons of rubber boots and two of the cartons of phonograph records which had been stolen from the Crowe and Company Albany terminal. Gladstein, at the time of arrest, told the agents that the truck had been left with him to sell and that he was moving it off the street to an unidentified lot farther up the road. When directed by the agents to drive the truck to his own lot, which, interestingly enough, was only one hundred feet away, Gladstein did so and had no difficulty parking the truck there. Gladstein consented shortly thereafter to a search by FBI agents of a Bronx store owned by him. The searchers there found additional cartons of rubber boots, one carton of phonograph records, and one carton of clothes, all of which had been part of the load stolen from the Crowe and Company terminal.

At the close of the Government's case Judge Murphy dismissed the conspiracy count of the indictment for failure of proof. If the Government had succeeded in establishing the existence of the alleged conspiracy, the jury would have been permitted to consider, under the established exception to the hearsay rule that makes admissible against every member of a conspiracy the declarations of any one conspirator which have been made in furtherance of the conspiracy, unsworn out-of-court statements made by any of the defendants as evidence against every one of them. Krulewitch v. United States, 336 U.S. 440, 69 S. Ct. 716, 93 L. Ed. 790 (1949); United States v. Mishkin, 317 F.2d 634 (2 Cir.), cert. denied, 375 U.S. 827, 84 S. Ct. 71, 11 L. Ed. 2d 60 (1963); United States v. Lev, 276 F.2d 605 (2 Cir.), cert. denied, 363 U.S. 812, 80 S. Ct. 1248, 4 L. Ed. 2d 1153 (1960). However, a failure to establish the existence of a conspiracy would render inadmissible for this broad purpose the out-of-court declarations which, subject to the Government's establishing the alleged conspiracy, had already been permitted to come into evidence against the defendants generally. On the other hand, there being no indication of bad faith on the part of the Government in bringing the conspiracy count, or of special circumstances requiring a different procedure, the defendants have no valid objection if the use of the evidence introduced against them subject to proof of a conspiracy were properly so limited. United States v. Manfredi, 275 F.2d 588 (2d Cir.), cert denied, 363 U.S. 828, 80 S. Ct. 1598, 4 L. Ed. 2d 1523 (1960); United States v. Schaffer, 266 F.2d 435 (2 Cir. 1959), aff'd, 362 U.S. 511, 80 S. Ct. 945, 4 L. Ed. 2d 921 (1960). This was done here and the limiting instructions which Judge Murphy gave to the jury adequately protected these defendants.

After the close of the Government's case and the dismissal of the conspiracy count, and before the summations and the charge to the jury, Judge Murphy informed the jury that the conspiracy count had been dismissed and instructed the jurors to "confine your thinking to the evidence that was received that related to a specific defendant as distinguished from some conversations that were had in his absence." During his charge Judge Murphy devoted considerable attention to the matter of the limited use to which the jury could put the codefendant declarations:

"Secondly, there was considerable testimony which I permitted in evidence on the representation that the government was going to connect it later on. This related generally to the conspiracy count, which is no longer in the case, and to a large extent related to conversations that Mr. Pitts had with Manin, sometimes called California, and conversations with Mr. Cogdell and also related to conversations that Cogdell had with Pitts and Manin.

"If the government had proved the conspiracy, according to the way I understand the law, the conversations by conspirators could be admissible against all conspirators even though they were not present. But since I have dismissed the conspiracy you must disregard that testimony and consider only the testimony that relates to specific defendants and only those conversations had with a specific defendant and in that defendant's presence. Now, this does not exclude any conversations that Mr. Pitts or Mr. Cogdell made with the defendant Elgisser as long as you remember that it can be considered by you only with regard to the defendant Elgisser and not relating to Gladstein. It also does not exclude any conversations Pitts or Cogdell had with the defendant Gladstein, but you must consider that such conversations are to be considered by you only with regard to Gladstein and not with regard to Elgisser."

These interim instructions, and the charge of the trial court adequately apprised the jury that it was not to consider the unsworn out-of-court statements of any one defendant as evidence against any other defendant*fn2 See United States v. Manfredi, supra, 275 F.2d at 593-594; United States v. Schaffer, supra, 266 F.2d at 443; United States v. DeFillo, 257 F.2d 835, 839 (2 Cir. 1958), cert. denied, 359 U.S. 915, 79 S. Ct. 591, 3 L. Ed. 2d 577 (1959); United States v. Herskovitz, 209 F.2d 881, 885-886 (2 Cir. 1954). In fact, the instructions and charge may well be viewed as having gone beyond this, for, literally read, they even barred as evidence against the defendants all statements by Pitts and Cogdell which were made out of the defendants' presence. Of course, since Pitts and Cogdell testified in court as to their own prior declarations the hearsay rule could not possibly have operated to render these statements inadmissible in any way; and, as long as the requirements of relevancy and materiality were met, the statements were admissible against any of the defendants. See United States v. Mishkin, supra, 317 F.2d at 637.

Contrary to defendant Gladstein's second claim of error, there was sufficient evidence to establish that his possession of the stolen goods had been with the requisite knowledge that they had been stolen. Two days after the goods had been stolen Gladstein was apprehended driving his own truck, the one which had been used in the theft, which contained most of the stolen goods. The rest of the goods were found, shortly after Gladstein was taken into custody, in a store owned by him. At trial Gladstein offered no explanation for his possession. This in itself was sufficient to entitle a jury to draw the permissible inference that Gladstein had possessed the goods knowing them to have been stolen. United States v. Minieri, 303 F.2d 550 (2 Cir.), cert. denied, 371 U.S. 847, 83 S. Ct. 79, 9 L. Ed. 2d 81 (1962); United States v. Lefkowitz, 284 F.2d 310 (2 Cir. 1960). Moreover, there was considerable evidence other than unexplained possession by Gladstein tending to establish guilty knowledge on his part. Gladstein's statements to Cogdell and Pitts, made when arrangements were being worked out for the use of Gladstein's truck, tended to establish that Gladstein realized that the vehicle was going to return with stolen goods, as did the warning to "be careful" which he issued when he turned the truck over to them the ...

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