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United States v. Alper

decided: September 14, 1971; As Amended November 2, 1971.

UNITED STATES OF AMERICA
v.
FRANK ALPER, APPELLANT, ET AL. UNITED STATES OF AMERICA V. FRANK ALPER ET AL. APPEAL OF STANLEY M. GREENBERG



Seitz, Chief Judge, and Gibbons and Rosenn, Circuit Judges.

Author: Gibbons

Opinion OF THE COURT

GIBBONS, Circuit Judge.

Defendant-appellants Alper and Greenberg were indicted on March 20, 1968. The indictment, in twenty-one counts, charged Alper, Greenberg and one Feiner as defendants in a conspiracy count in which one Hartsock is named as a co-conspirator. 18 U.S.C. § 371 (1964). It charges Alper, Greenberg and Feiner with twenty counts of mail fraud. 18 U.S.C. § 1341 (1964). All three defendants pleaded not guilty and were tried before Judge Lawrence A. Whipple*fn* and a jury in the District Court for the Eastern District of Pennsylvania beginning on March 3, 1970. The conspiracy count and the mail fraud counts all relate to a complicated check kiting scheme involving checking accounts of Alper, Greenberg, Magnum Chemical Corporation, Life Aid Corporation, Trans-Ignition Systems, Inc., Portable Oxygen Corporation and Stellar National Products, Inc. The kite allegedly was run for the purpose of obtaining money from Central Penn National Bank, Industrial Valley Bank, Philadelphia National Bank and Fidelity Philadelphia Trust Company, all of Philadelphia, and Peoples National Bank of Westmont, New Jersey, First National Bank of Stone Harbor, New Jersey, Cherry Hill National Bank, Cherry Hill, New Jersey, Delaware Valley Bank and Trust Company, Cherry Hill, New Jersey and First National City Bank of New York. Checking transactions alleged to have been made in furtherance of the conspiracy began in September of 1963 and continued until June of 1965, when the kite was discovered by some of the banks.

The corporations against whose accounts checks were drawn were all formed at the behest of Alper to carry on a sales business. Greenberg, an attorney, formed each corporation. He became a director of Magnum and of Life Aid. Several of the corporations paid Greenberg $100 a week, from which federal income taxes and Social Security taxes were withheld. These payments continued until late February 1965. One of Alper's corporations furnished Greenberg with an automobile. Feiner was an accountant hired for the corporations by Alper in March of 1965. The co-conspirator, Hartsock, was an officer of Peoples National Bank, and was charged by the government as being instrumental in concealing the existence of the kite from his own and other banks. Hartsock died before the indictments were returned.

The trial lasted from March 3 to April 28, 1970. The prosecution placed in evidence 148 exhibits consisting primarily of bank records, canceled checks, deposit slips, loan ledgers and checking account statements. Alper and Feiner elected not to testify. Greenberg testified at length about his representation of Alper and Alper's corporations. He denied that he had any knowledge of Alper's check kiting. After being charged on April 28, 1970, the jury retired to deliberate at 3:20 P.M. The jury recessed its deliberations at 10:15 P.M. on that date. It resumed deliberations at 9:00 A.M. on April 29, and at 10:35 A.M. advised the court that it had reached a verdict on Alper and Feiner but was hopelessly deadlocked as to Greenberg. Alper was found guilty on all counts. Feiner was acquitted on all counts.

Thereafter the court gave the jury a supplemental instruction and directed that it continue deliberation as to Greenberg. Following this supplemental instruction the jury deliberated for approximately an hour and returned a verdict finding Greenberg guilty on count I, the conspiracy count, and not guilty on all other counts. Motions for a new trial and for a judgment of acquittal were denied by the district court on December 4, 1970, and the defendants were sentenced on March 17, 1971. This appeal followed.

I. Alper's contention that the sentence was excessive.

Alper was convicted on twenty-one counts. He was sentenced on count I to imprisonment for five years, and on counts II through XXI to imprisonment for five years to run concurrently with the sentence imposed on count I. He contends that in view of his prior spotless record it was an abuse of discretion for the district court to impose so severe a sentence. The sentence is within the range permitted. 18 U.S.C. § 371 (1964); 18 U.S.C. § 1341 (1964). Alper has made no effort to have brought to our attention the contents of the presentence investigation report on which the district court relied. Our review of the evidence convinces us that the sentence was appropriately within the range of discretion for the district court.

II. The district court's denial of motions for a judgment of acquittal at the end of the government's case and at the end of the entire case.

Both defendants contend that the district court erred in failing to grant their motions for a judgment of acquittal.

Alper contends that the government never proved a specific intent to defraud; rather, that he "tried to take advantage of a common business practice, perhaps in a careless way, which eventually grew out of proportion and backfired on him."*fn1 Reasonable jurymen could conclude from the evidence that Alper was the chief participant in a check kite from October 22, 1964, to March 30, 1965, between Peoples National Bank and First National Bank of Stone Harbor involving 134 checks totaling over $2,000,000; from April 1, 1965, to June 10, 1965, between First National Bank of Stone Harbor and Industrial Valley Bank involving 335 checks totaling more than $4,500,000; from April 27, 1965, to June 23, 1965, between Fidelity Philadelphia Trust Company and First National Bank of Stone Harbor involving 158 checks totaling more than $3,000,000. There were at least four other kites, and the checks involved totaled approximately $12,000,000. Of the corporations whose checking accounts were used, only the Magnum Chemical Corporation checking account was used for ordinary business purposes. The remaining accounts were used primarily if not exclusively for purposes of the various kites. No useful purpose would be served by a more detailed recital of the evidence. It was clearly sufficient to withstand a motion for a judgment of acquittal and to sustain the jury's verdict against Alper.

Greenberg contends that he was related to Alper and the corporations only as an attorney and that the evidence relied upon by the government is as consistent with his lack of knowledge about and participation in the conspiracy as with guilt. We cannot agree. As with Alper a detailed recital of the evidence would serve no useful purpose. But it could hardly have been proper to grant Greenberg's motion for a judgment of acquittal when the evidence showed that at times when Greenberg, a former director*fn1a of several of Alper's corporations, was still on their payroll he drew nine checks on his personal checking account with the Central Penn National Bank in amounts which he then knew were in excess of the account balances payable to Life Aid Corporation, and covered these checks with checks which he then knew were drawn by Alper on a corporate account against uncollected funds. The drawing of three of these checks is alleged as an overt act in the conspiracy count. After Greenberg resigned as a director of the Life-Aid and Magnum corporations, he continued his close business relationship with Alper. He continued to receive and accept weekly payments from Alper's corporations and attempted to help Alper obtain investors and financing. Furthermore, during the time that Alper's corporations were experiencing difficulties with various banks because of overdrafts, Greenberg contacted officials of these banks and interceded on Alper's behalf. From Greenberg's continued close association with Alper, his direct participation in a check kite in the early stages of Alper's manipulations, and his efforts in the later stages to reassure several bankers worried about overdrafts, the jury could reasonably conclude that he was and continued to be a conspirator with Alper in a scheme to defraud. The evidence against him, though not as overwhelming as that against Alper, who played the leading role in this drama of high finance, was clearly sufficient to withstand a motion for a judgment of acquittal and to sustain the jury's verdict against Greenberg. The conspiracy was a matter separate and apart from the substantive offenses. Pinkerton v. United States, 328 U.S. 640, 643, 66 S. Ct. 1180, 90 L. Ed. 1489 (1946); United States v. Pappas, 445 F.2d 1194, 1198 (3d Cir. 1971). After a verdict the evidence in support thereof must be viewed in the light most favorable to the government. United States v. Carlson, 359 F.2d 592, 597 (3d Cir. 1966).

III. The district court's denial of motions for a new trial.

The appellants contend that various trial errors were so prejudicial as to warrant a new trial. We will consider these contentions separately.

A. The contention that the District Judge read the charge to the jury too rapidly.

Appellants contend that the District Judge charged the jury in a sharp, staccato voice and in an extremely speedy manner, so as to make the charge almost incomprehensible. Everyone else in the courtroom, including the court reporter, apparently was able to comprehend the charge. This contention we reject as frivolous.

B. Greenberg's contention that evidence was erroneously admitted.

The witness Brammer, an officer of the Fidelity Philadelphia Trust Company, testified at trial to receiving a telephone call on July 2, 1965, from a person who identified himself as Stanley M. Greenberg, Alper's attorney. The questions, answers and relevant colloquy are as follows:

"Q. Mr. Brammer, do you recall any telephone conversations with the defendant Stanley Greenberg?

A. I had a call from a party representing himself as attorney for Mr. Alper, or stating that he was Mr. Greenberg, that no one was going to be hurt, and that a loan was being arranged through the Central Penn National Bank, and if there were any difficulties with any additional checks, which we didn't know about at that time, why, it would all be taken care of with proceeds from the loan.

Q. During this conversation was any mention made of Mr. Alper's reputation?

A. I can't--I can't remember anything--

Q. Is there anything in your memorandum that would refresh your recollection?

THE COURT: Can you fix the date when the call allegedly came from a person by ...


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