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UNITED STATES v. SWEIG

April 22, 1970

UNITED STATES of America
v.
Martin SWEIG and Nathan Voloshen, Defendants


Frankel, District Judge.


The opinion of the court was delivered by: FRANKEL

FRANKEL, District Judge.

The court has been presented with an array of motions by defendants Martin Sweig and Nathan Voloshen, who are variously charged, separately or together, in a 15-count indictment. The court has heretofore decided motions for particulars and discovery. Additional rulings are now ready and are announced herein. Others remain for study and decision in the near future.

 The first count of the indictment charges both defendants with a conspiracy violative of 18 U.S.C. § 371. It alleges that from the beginning of 1964 to the date of the indictment in January 1970, defendant Sweig, who was serving in Washington, D.C., as an Assistant to Speaker John W. McCormack of the United States House of Representatives, and defendant Voloshen, who lived and had an office in New York City conspired

 
"with each other and with other persons to the grand jury known and unknown, *fn1" to defraud the United States and agencies thereof, in connection with its lawful governmental functions hereinafter described, to wit: (a) its lawful function to have its business and affairs conducted honestly and impartially as the same should be conducted, free from fraud, improper and undue influence, dishonesty, unlawful impairment and obstruction; (b) its lawful right to have its officers and employees, free to transact the official business of the United States unhindered, unhampered, unobstructed, unimpaired and undefeated by the exertion upon them of dishonest, unlawful, impaired and undue pressure and influence."

 Paragraph 4 of the indictment says it was part of the conspiracy (a) that Voloshen "would and did accept fees from various persons with matters pending before [federal] departments and agencies * * * to exert the influence of the office of the Speaker of the House to said agencies, on behalf of said persons," (b) that Voloshen "would and did use the offices, telephone, secretarial staff, and goodwill of the Speaker," (c) that both defendants would agree to have Sweig, "by various means, express the interest of the Office of the Speaker * * * in said matters * * * on behalf of said persons," (d) that Voloshen "would and did falsely assume and pretend" to be a member of the Speaker's staff and (e) that Sweig "would and did act as agent and attorney for persons before departments and agencies of the Government in connection with * * * matters in which the United States was a party and in which it had a direct and substantial interest." Paragraph 5 alleges the use of telephone calls, from the Speaker's offices and elsewhere, and of personal visits by both defendants to "express the interest of the office of the Speaker of the House in said matters pending before said agencies." A list of 15 alleged overt acts includes a number of telephone calls, two appearances before the Securities and Exchange Commission, and receipts of fees on two occasions by defendant Voloshen.

 Count Two charges that Voloshen, on November 1, 1968, violated 18 U.S.C. § 912 by falsely pretending to be a member of the Speaker's staff and appearing in that guise before the Treasury Department's Alcohol, Tobacco and Firearms Division, where he "advocated a position on behalf of the Century Arms Company."

 Count Three charges that Sweig, aided and abetted by Voloshen, violated 18 U.S.C. § 205 when, on May 7, 1969, he appeared before the S.E.C. "as an agent for the Parvin/Dohrmann Company" in connection with the Commission's suspension of trading in that Company's stock.

 Counts Four through Twelve charge Sweig with perjury in testimony he gave before a grand jury in this Court on October 15, 1969. Briefly described, these charges allege false testimony concerning: a visit to S.E.C. headquarters, the arranging of an appointment there for Voloshen, the subjects or existence of telephone calls to specified government people, and Sweig's acquaintance with, or knowledge of, named individuals for whom, in the Government's evident theory, the defendants are thought to have conspired to exert improper influence or otherwise to act unlawfully.

 Counts Thirteen through Fifteen charge perjurious grand jury testimony by Voloshen on August 15 and 19, 1969, concerning payments to him, and, on the latter date, concerning his knowledge of one individual and representation of another.

 Motions To Dismiss

 1. Both defendants seek dismissal of the indictment on the ground that it was preceded by masses of publicity reporting or speculating about allegations of misconduct by them, and that this deprived them of the right to have an impartial and unbiased grand jury determine whether or not they should be indicted. See Costello v. United States, 350 U.S. 359, 363, 76 S. Ct. 406, 100 L. Ed. 397 (1956); Lawn v. United States, 355 U.S. 339, 349, 78 S. Ct. 311, 2 L. Ed. 2d 321 (1958). There appears to be no doubt about the existence, character and large quantity of pre-indictment publicity. But defendants do not shoulder the probably unmanageable burden of arguing that those factors alone could warrant nullification of the grand jury's decision to indict. Cf. Costello v. United States, supra, 350 U.S. at 362-363, 76 S. Ct. 406; Lawn v. United States, supra, 355 U.S. at 349-350, 78 S. Ct. 311; Pittsburgh Plate Glass Co. v. United States, 360 U.S. 395, 399-400, 79 S. Ct. 1237, 3 L. Ed. 2d 1323 (1959); United States v. Blue, 384 U.S. 251, 255, 86 S. Ct. 1416, 16 L. Ed. 2d 510 n. 3 (1966); United States v. Nunan, 236 F.2d 576, 593 (2d Cir. 1956), cert. denied, 353 U.S. 912, 77 S. Ct. 661, 1 L. Ed. 2d 665 (1957). Instead, the focus of their attack is upon the asserted fact that much of the publicity was generated by the Department of Justice itself or by other agencies of the Government. And while even this seeks an unprecedented kind of relief, see Gorin v. United States, 313 F.2d 641, 645 (1st Cir. 1963), the argument on its face has substance.

 Granted the historic proposition that grand juries may roam fairly widely (and certainly outside the limits of Wigmore's concerns) in collecting their factual beliefs, e.g., Costello v. United States, supra, it can hardly be doubted now that prosecutors must observe some limits of essential fairness in their work with such investigatory bodies. See United States v. Umans, 368 F.2d 725, 730 (2d Cir. 1966). Unless the role of the grand jury as a shield for the citizen as well as a prosecutorial agency is to become an empty slogan, there are kinds of pressure that must obviously be avoided to the extent possible. However free may be the sources of "fact," the generation of public animus against a prospective defendant, with the attendant danger that grand jurors may be subjected to subtle or explicit "demands" for prosecution, see Sheppard v. Maxwell, 384 U.S. 333, 339-342, 86 S. Ct. 1507, 16 L. Ed. 2d 600 (1966); see also Beck v. Washington, 369 U.S. 541, 585-587, 82 S. Ct. 955, 8 L. Ed. 2d 98 (1962) (Douglas, J., dissenting), is no part of the prosecution's legitimate business. It may be (at least the court accepts for now, as defendants appear to do) that such "atmospheric" influences have to be dealt with by measures short of dismissing indictments when the sources and causes are wholly non-official. But the interest in the integrity of the criminal process may require sterner measures of prophylaxis if the prosecution itself forgets its duty to "be sensitive to the considerations making for wise exercise of such investigatory power." Hoffman v. United States, 341 U.S. 479, 485, 71 S. Ct. 814, 817, 95 L. Ed. 1118 (1951).

 This thought may proceed a small step beyond the lower-court precedents the Government cites. It has indeed been common in past cases to reject motions of the general kind here in question for failure to show actual "prejudice" resulting from pre-indictment publicity. United States v. Osborn, 350 F.2d 497 (6th Cir. 1965), aff'd, 385 U.S. 323, 87 S. Ct. 429, 17 L. Ed. 2d 394 (1966); Estes v. United States, 335 F.2d 609, 613 (5th Cir. 1964), cert. denied, 379 U.S. 964, 85 S. Ct. 656, 13 L. Ed. 2d 559 (1965); Gorin v. United States, 313 F.2d 641, 645 (1st Cir. 1963), cert. denied, 379 U.S. 971, 85 S. Ct. 669, 13 L. Ed. 2d 563 (1965); Beck v. United States, 298 F.2d 622, 627 (9th Cir.), cert. denied, 370 U.S. 919, 82 S. Ct. 1558, 8 L. Ed. 2d 499 (1962); United States v. Dioguardi, 20 F.R.D. 33, 34-35 (S.D.N.Y. 1956). But such rulings, perhaps reflecting the nearly impenetrable armor traditionally protecting indictments, have tended to prescribe a test normally impossible of fulfillment. The secrecy of the grand jury's work, usually preserved in large measure at least until or after the trial, is a barrier to even an attempted showing of prejudice. It has sometimes seemed, therefore, that attacks upon indictments because of prejudicial publicity were inevitably doomed as a matter of law.

 There have, nevertheless, been intimations before now that the case of prosecution-inspired publicity might be different. See Silverthorne v. United States, 400 F.2d 627, 633-634 (9th Cir. 1968); United States v. Nunan, 236 F.2d 576, 593 (2d Cir. 1956), cert. denied, 353 U.S. 912, 77 S. Ct. 661, 1 L. Ed. 2d 665 (1957); United States v. Kahaner, 204 F. Supp. 921, 922 (S.D.N.Y. 1962). Recent developments give special meaning to such warnings. We have been led (or driven) only in very recent days to intervene some in the reconciling of the interests in free expression and fair criminal proceedings. In our first steps at least, there has been wide recognition, as a matter of propriety not less than power, that greater demands should be made upon the court's own officers than upon those whose business it is to gather and purvey the "news." See ABA Project on Minimum Standards for Criminal Justice, Fair Trial and Free Press 76-79 (Tent. Draft 1966 -- "the Reardon Report"). In the implementation of that understanding, we have recognized the dangers of publicity before as well as after indictment.

 Thus, this Court's Criminal Rule 8, effective January 1, 1969, says in part:

 
"With respect to a grand jury or other pending investigation of any criminal matter, a lawyer participating in the investigation shall refrain from making any extrajudicial statement, for dissemination by any means of public communication, that goes beyond the public record or that is not necessary to inform the public that the investigation is underway, to describe the general scope of the investigation, to obtain assistance in the apprehension of a suspect, to warn the public of any dangers, or otherwise to aid in the investigation."

 In light of the foregoing considerations, including the quoted local Rule, the court found insufficient the Government's initial responses in this case to the charges of pre-indictment publicity. The large collection of newspaper stories submitted by defendants contained indications (references to "official" informants and the like) that their sources were government people. Cf. United States v. Kahaner, 204 F. Supp. 921, 922 (S.D.N.Y. 1962). The Government's answering papers contained no factual affidavit, resting upon the proposition that the motions must be rejected as a matter of law. Then, however, when the court suggested the possible insufficiency of that broad proposition, affidavits were filed denying explicitly that the then United States Attorney, his Assistants working on the case or any of their colleagues had given out the statements and alleged information recounted in the press. It is conceded that the Assistant Attorney General in charge of the Criminal Division, Department of Justice, about a month before the indictment, did make "a general statement in response to a press inquiry * * * to the effect that grand juries in Baltimore and New York were investigating the activities of Nathan Voloshen * * *." Affidavit of Assistant United States Attorney Richard Ben-Veniste, sworn April 9, 1970, par. 8. It is not clear whether the Government believes this statement to have been in entire conformity with our Rule 8, although we are assured on behalf of the Assistant Attorney General that "he did not at any time reveal to members of the press or other media, formally or informally, anything that occurred in the grand jury or anything to do with the substance of [the] case." Id. Whatever the details may be, and assuming that the December 1969 activity may have been inconsistent with our recently promulgated Rule, the incident does not appear to be of major proportions.

 Taking all the materials together, defendants have failed to present a concrete basis for inferring that government officials were responsible in any substantial degree for the unquestionably considerable amount of publicity preceding the indictment. Cf. United States v. Kahaner, supra, 204 F. Supp. at 922-923. The unspecified "sources" mentioned in the newspaper stories defendants cite are nowhere particularized. Granting that the particularization is no simple matter, especially in view of the care journalists exercise to preserve the confidentiality of their sources, cf. Application of Earl Caldwell, 311 F. Supp. 358 (N.D. Cal., April 6, 1970), the circumstances do not now justify an evidentiary hearing to test on this asserted ground the validity of the indictment.

 Should there be a conviction, this subject may be added to matters (namely, the alleged "taint" resulting from unlawful eavesdropping) already anticipated as questions for post-trial consideration. It may be appropriate then, if only to supply a fuller record for appellate review, to have a more precise and direct account of what the Assistant Attorney General said to the press in December 1969. It may also be appropriate to consider whether defendants should then be permitted to study the grand jury minutes to appraise the kind and amount of evidence that body had before it and thus, possibly, to mount a claim of prejudice from the relative impact of outside influences.

 Without foreclosing such renewed efforts if they should come to seem necessary and proper, the court at this time rejects the prayers for dismissal because of publicity preceding the indictment.

 2. Defendant Sweig urges that Count One fails to state an offense. It may be, he suggests, that the conduct alleged would offend a refined sense of ethical propriety. But Congress, the argument proceeds, has been notably more lenient about ethical restraints with itself and its staffs than with people in other branches, and has not proscribed activities like those alleged in Count One. If this construction of 18 U.S.C. § 371 is correct, whatever the motives of its framers, then the motion must of course be granted. But the court concludes that defendant Sweig has misconceived the statute and misread the Count in question.

 The statute, it was settled long ago, when it outlaws schemes "to defraud the United States," covers all manner of conspiracies "to interfere with or obstruct one of [the Federal Government's] lawful governmental functions by deceit, craft or trickery, or at least by means that are dishonest." Hammerschmidt v. United States, 265 U.S. 182, 188, 44 S. Ct. 511, 512, 68 L. Ed. 968 (1924); Haas v. Henkel, 216 U.S. 462, 476, 30 S. Ct. 249, 54 L. Ed. 569 et seq. (1910); United States v. Manton, 107 F.2d 834 (2d Cir. 1939). The sweep of that prohibition embraces the conspiracy charged in Count One.

 It is charged, inter alia, that Sweig and Voloshen agreed to have the latter take fees from people with matters before government agencies in exchange for undertaking "to exert the influence of the office of the Speaker of the House to said agencies * * *." This alone would seem sufficient to allege a conspiracy forbidden by § 371. There is no allegation, Sweig says, that the agreement was "to exert the influence of the office of the Speaker" either "untruthfully" or "contrary to what [Sweig] reasonably thought were the Speaker's general instructions * * *." Whether this rather subtle point has any reality may be a matter to be fully understood only on the basis of detailed evidence at a trial. It remains, that is, to know what can be signified by the notion in this context of "untruthfulness" or of disobedience to instructions. Surely, even apart from the presumption of official regularity, there is not a word in the indictment charging any semblance of improper conduct by the Speaker himself. Still more surely, we are compelled to presume at this point that the Speaker neither knew of nor intimated any disposition to sanction the scheme alleged. And so the argument seems to dwindle to the suggestion that as the indictment is framed, it leaves entirely open the possibility that the alleged positions pressed (or agreed to be pressed) by the conspirators (in return for payments to Voloshen) as those of "the office of the Speaker" were not contrary to those the office might have taken apart from the conspiracy.

 Whether that is actually the limited import of the Government's contentions under Count One must, as has been stated, await further development of the case. But this makes no difference for purposes of the motion now under consideration. For it is by now perfectly clear "that the payment of money by a private person to an official of the Government for the performance of an official act constitutes a fraud." United States v. Johnson, 337 F.2d 180, 186 (4th Cir. 1964), affirmed on another issue, 383 U.S. 169, 86 S. Ct. 749, 15 L. Ed. 2d 681 (1966); *fn2" cf. 18 U.S.C. § 201(f). It is at least equally clear that the taking of such payments by one purporting to act for an official, plus the promise to exert improper pressures upon other officials, comes within the ban against schemes "to interfere with or obstruct * * * lawful governmental functions by deceit, craft or trickery, or at least by means that are dishonest." Hammerschmidt v. United States, supra, 265 U.S. at 188, 44 S. Ct. at 512.

 The fact that Sweig is not alleged to have taken money or other things for his part in the alleged conspiracy does not justify dismissal of Count One for facial insufficiency. It may be doubted whether a jury would -- or could be permitted to -- convict unless it found evidence to show for each alleged conspirator some meaningful "stake" in the enterprise. But the interest need not have been monetary, or material at all. See Craig v. United States, 81 F.2d 816, 822 (9th Cir.), cert. denied, 298 U.S. 690, 56 S. Ct. 959, 80 L. Ed. 1408 (1936). At any rate, the failure to allege this motivational point is not fatal to the indictment.

 In addition to the things already mentioned, Count One charges that, as part of the combination and conspiracy, Voloshen used the Speaker's offices, staff, and other facilities, posed falsely as a member of the Speaker's staff, and himself called various executive officers for the purpose of "expressing the interest" of the Speaker's office.

 Taken all together, the allegations of Count One seem more than ample to state an offense. There may be interesting questions later on as to how many of these allegations must be proved to establish the charge. But that is a problem far down the road from here.

 3. Defendant Sweig has also moved to dismiss Count Three for failure to state an offense. While he is charged literally with a violation of 18 U.S.C. § 205 -- namely, with acting "as agent or attorney" for the Parvin/Dohrmann Company before the S.E.C. in connection with a proceeding by that agency affecting suspension of trading in the company's stock -- he says no violation should be deemed effectively to be alleged because

 
(1) he is not an attorney and never claimed to be one, and
 
(2) he was not an "agent" in the sense of having "power to affect the legal relations" of ...

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