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UNITED STATES v. ZIVE

May 14, 1969

UNITED STATES of America
v.
Edward ZIVE, Defendant



The opinion of the court was delivered by: WYATT

WYATT, District Judge.

 This is a motion for defendant for an order (a) directing the return of property seized and suppressing it for use as evidence (Fed.R.Crim.P. 41(e)), and (b) directing the United States Attorney to furnish defendant all evidence favorable to him or which would tend to exculpate him.

 The indictment charges in one count that on September 17, 1968 defendant gave a bribe to an employee of the Internal Revenue Service (18 U.S.C. § 201(b)) and in a second count that defendant gave a gratuity to such an employee (18 U.S.C. § 201(f); there is a typographical error in the citation to this statute in the indictment). Both counts refer to an audit examination of the 1965 Federal income tax return of defendant.

 The second branch of the motion can be disposed of without much difficulty. This second branch of the motion is based on Brady v. Maryland, 373 U.S. 83, 83 S. Ct. 1194, 10 L. Ed. 2d 215 (1963).

 Brady v. Maryland did not deal in any way with pretrial discovery by a defendant nor with any duty of the court in that respect. On the contrary, the discussion was of the duty of the prosecutor, wholly apart from any order of the court. "[No] pre-trial remedies were intended to be created" by Brady. United States v. Manhattan Brush Co., 38 F.R.D. 4, 7 (S.D.N.Y.1965) (Palmieri, J.).

 Moreover, the Supreme Court prescribed amendments to the Rules of Criminal Procedure, effective July 1, 1966, or somewhat more than three years after the Brady decision. These amendments were specifically intended "to expand the scope of pretrial discovery". Advisory Committee's Note to Rule 16. Yet there was no provision for any such pretrial discovery as is here sought, and Brady v. Maryland was not even mentioned in the Notes (which contained many citations). The motion in this aspect is denied.

 The first branch of the motion is more difficult and a hearing was held on April 11 and 17, 1969, at which testimony and other evidence was taken.

 The facts do not appear to be in dispute.

 Toward the end of August 1968, Internal Revenue Agent Katz was making an audit of the Federal income tax returns of defendant Zive for the years 1965 and 1966. Katz had been assigned these two years but during his audit he added 1967 as another year.

 Zive was in the scrap metal business at 175th Street and Webster Avenue in the Bronx. He did business as an individual proprietor, using the trade name "Zive Metal Company".

 Katz reported to Inspector Litwack that during the audit he examined invoices from the 15 or 20 sellers of metal to Zive and attempted to verify their names on the invoices from the telephone directory; that he could not find them listed; that he then questioned Zive; that Zive told him these sellers did not want to give their names but that he (Zive) was obliged by City regulations to keep records and therefore had used fictitious names in his records; that Zive said that everything in the records about the purchases was accurate except the names; that Zive told him he had to make payoffs to police officers and other City officials and had hidden these payoffs in his records by falsifying purchase prices of items; that he (Katz) saw Zive make such a payoff; and that Zive had suggested a payment to Katz as a reward for overlooking the fictitious name invoices. Katz also reported that Zive expressed apprehension that Katz might be "bugged" when he came back; further that Zive kept a gun in his office. Katz stated a belief that Zive might have omitted income from his returns and perhaps had committed tax fraud.

 Katz telephoned Zive and made an appointment to see him on September 17, 1968.

 On the morning of September 17 Katz was fitted out with a transmitter concealed on his person. He then went to Zive's office. Nearby were eight inspectors or agents in four automobiles with receiving and recording equipment. The idea was to pick up the conversation between Zive and Katz, transmitted by the equipment concealed on the person of Katz. It was anticipated that Zive would pay a bribe to Katz. The number of cars and agents was due to fear that interference from traffic and other causes would make reception in some spots difficult.

 The Zive-Katz conversation was received and recorded in the waiting cars. One of the cars was parked at the back of a gas station near Zive's office. While the monitoring was going on, a man who was thought to be either an employee of Zive or of the gas station, came up to this car and observed the recording equipment. Also during this period, the inspectors noticed a number of police cars cruising in the area; this gave the inspectors some concern because of the reported payoffs by Zive.

 At about eleven o'clock that morning, Katz left Zive's office and met the inspectors a few blocks away in Echo Place. Katz reported that Zive had given him $2500 to overlook the fictitious name invoices and to make an audit report without questioning those invoices. He produced twenty-five $100 bills which he said had been given him by Zive. Katz reported that there were two female employees then in Zive's office and two male visitors. Katz and one of the inspectors then left the area with the money.

 Inspector Litwack was in charge of the seven remaining inspectors. He announced that he would arrest Zive at once and make a search at the same time for the gun and for books and records pertaining to Zive and his business for the three years 1965, 1966 and 1967, for "whatever was considered evidence, possible or probable evidence of probative value" (SM 87) as to "the crime of bribery and possible tax fraud" (SM 88).

 Three of the inspectors went to Zive's office. Litwack identified himself, placed Zive under arrest for bribery, and advised him of his constitutional rights. Two other inspectors stayed outside Zive's office with the object of preventing customers from entering. The other two inspectors waited about five minutes and then joined the first three inspectors in Zive's office.

 An inspector asked Zive where his gun was. Zive pointed to the open middle (shallow) desk drawer and produced a pistol permit. The inspector pulled out the pistol, unloaded it, and later (when they left the office) replaced the pistol in the drawer, and also near it the ammunition.

 Zive's office was about 35 feet long by 15 feet wide. There was a desk in front and Zive's desk was in the rear. By a wall was four drawer file cabinet, on top of which were various books.

 Litwack and two other inspectors searched Zive's desk, the top of the filing cabinet and three of the file drawers. The search lasted about 25 minutes

 Books and records were seized during the search. No inventory was made at the time but at the request of counsel for defendant a list of what was seized was given by the United States Attorney on September 27, 1968. This list contained numbered items and reference hereafter ...


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