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United States v. Gross

decided: February 19, 1975.

UNITED STATES OF AMERICA
v.
NELSON G. GROSS, APPELLANT



APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY (D.C. Crim. No. 324-73).

Aldisert, Adams and Hunter, Circuit Judges.

Author: Aldisert

Opinion OF THE COURT

ALDISERT, Circuit Judge.

Nelson G. Gross appeals from a final judgment of sentence following a jury verdict on a five-count indictment charging aiding and assisting the filing of a false and fraudulent tax return, obstruction of justice, subornation of perjury before a grand jury and two counts of conspiracy. 26 U.S.C. § 7206(2) and 18 U.S.C. §§ 1503, 1622, 371. Although appellant has presented thirteen issues for review, only certain merit discussion.

I.

Testimony was adduced at trial which, when taken in the light most favorable to the verdict winner, indicates the following: In July, 1969, Gross had a number of discussions with William Preis, president of Stop & Save Trading Stamp Corporation, pertaining to a possible $25,000 company contribution to William Cahill's gubernatorial campaign. When Preis stated that the company could not pay that much in cash, Gross proposed an "easy solution". Gross stated that if Preis agreed to make a $5,000 contribution by check, Gross would arrange to furnish Stop & Save with a bill for services rendered. Gross told Preis that "since it would be passed through as an operating expense it would become tax deductible, and it would actually only cost you half as much". (T. 1911-12). Gross assured Preis that, if the transaction were discovered, the worst that would happen would be a disallowance of the deduction by the Internal Revenue Service. In September, 1969, pursuant to this arrangement, Preis disguised a $5,000 contribution to Cahill's campaign as a business expense, utilizing a fictitious invoice from Writers Associates.

In the winter of 1972-73, the United States Attorney's office began investigating political activities in Bergen County, New Jersey. A federal grand jury issued a subpoena to Stop & Save in March, 1973, requiring the corporation to produce all records relating to Writers Associates. Thereafter, Preis met with Gross and, displaying the invoice and the grand jury's subpoena, asked, "Where do we go from here?" (T. 1993). Gross responded that the invoice represented payment for services rendered relating to a certain demonstration against an anti-trading stamp bill which had been pending in the New Jersey Legislature. Preis then asked Gross, "Why don't I just plain tell them the facts as they are, that it was a plain contribution?" (T. 1999). Gross replied, "You can't, because if you do at this late stage of the game, you will immediately be cited for conspiracy and for fraud." (Ibid.). Preis, accompanied by corporate counsel Leonard Wolfram, met with the United States Attorney and one of his assistants on April 12, 1973. When shown the invoice and asked what services had been rendered, Preis responded with the contrived story about the demonstration. The government prosecutors informed Preis that they did not believe him and invited him to "rethink the whole story, . . . get . . . good outside criminal counsel, . . . prepare to come back . . . and . . . appear before the Grand Jury . . . [and] be very careful to tell the truth . . .." (T. 2001). Later that day Preis met Gross and recited the events that took place in the United States Attorney's office. In response to Preis' need for outside criminal counsel Gross said, "You don't have any need for outside criminal counsel because I am it . . .. Perjury is one of the hardest criminal cases there is to prosecute and to prove, because . . . one of the ingredients and requirements of a perjury charge is to have someone get up and face you, challenge you, and claim that your statement was an out and out lie, and there is just nobody who can do that . . .. The only ones that really know the story behind this is [sic] myself and Joe McCrane. And I happen to know that Joe McCrane is going to plead the Fifth when he comes up for his hearing, and certainly I'm not going to tell . . .. So you have nothing to worry about for perjury . . .. They have no evidence of any kind. You have nothing to worry about. You can go right back and tell that same story, and you will get off absolutely free." (T. 2008-09).

On April 17, Preis appeared before the grand jury and testified that a Stop & Save check in payment of the Writers Associates' invoice represented payment to a group of women who demonstrated at the State Capitol in Trenton, New Jersey. Preis was later indicted for making false declarations before the grand jury, 18 U.S.C. § 1623.*fn1 On advice of new counsel, he pleaded guilty to the indictment, and received permission to go back to the grand jury and tell the truth about his and Gross' participation in the Cahill campaign. (T. 2021-31). The indictment against Gross followed.

II.

Count V of the indictment charged Gross with "suborn[ing] . . . Preis to commit perjury, as that crime is defined in Section 1623 of Title 18," in violation of 18 U.S.C. § 1622.*fn2 Appellant attacks his conviction on this count on alternative grounds. He contends that Count V of the indictment must be dismissed because Congress has not made subornation to make a false declaration a crime. Alternatively, appellant takes the position that, if such subornation is a crime, the court erred in refusing to charge the time-honored "two-witness rule."

We begin our analysis with the recognition that there are distinctions between the crime of general federal perjury, 18 U.S.C. § 1621,*fn3 and the recently-created crime, "False declarations before grand jury or court", 18 U.S.C. § 1623.

One difference concerns "the general rule in prosecutions for perjury [under § 1621] . . . that the uncorroborated oath of one witness is not enough to establish the falsity of the testimony of the accused set forth in the indictment as perjury." Hammer v. United States, 271 U.S. 620, 626, 70 L. Ed. 1118, 46 S. Ct. 603 (1926). Weiler v. United States, 323 U.S. 606, 610, 89 L. Ed. 495, 65 S. Ct. 548 (1945), reiterated the Hammer holding and reemphasized: "The rule has long prevailed, and no enactment in derogation of it has come to our attention. The absence of such legislation indicates that it is sound and has been found satisfactory in practice."*fn4

Legislation did come forward, however, in the Organized Crime Control Act of 1970, of which 18 U.S.C. § 1623 is a part, Title IV, Section 401(a), October 15, 1970, 84 Stat. 932. The Act makes it a crime for one to knowingly make "any false material declaration" before any court or grand jury of the United States. Section 1623(e) specifically provides: "Proof beyond a reasonable doubt under this section is sufficient for conviction. It shall not be necessary that such proof be made by any particular number of witnesses or by documentary or other type of evidence."

The legislative history discloses: "This Title [Title IV, FALSE DECLARATIONS] is intended to facilitate Federal perjury prosecutions and establishes a new false declaration provision applicable in Federal grand jury and court proceedings. It abandons the so-called two-witness and direct evidence rule in such prosecutions and authorizes a conviction based on irreconcilably inconsistent declarations under oath . . . ." 1970 U.S. Code Cong. & Ad. News 4007, 4008.

Abolition of the "two-witness rule" for prosecutions under § 1623 is not the only distinction between the two statutes. As we noted in United States v. Lardieri, 497 F.2d 317, 320 (3d Cir. 1974), rev'd in part on other grounds on rehearing before original panel, 506 F.2d 319 (3d Cir. 1974), Congress chose to provide different mens rea elements: "Unlike the general perjury statute, § 1623 requires that a false statement be made 'knowingly,' rather than 'willfully.'" Also, in § 1623 Congress expressly limited the tribunals before which the oath is taken.

Realizing that the general perjury and false declaration statutes have certain differences, appellant would have us hold that, without perjury as defined in § 1621, there can be no subornation of "such perjury" under § 1622. Brief at 30. We reject this unduly narrow interpretation of the subornation statute.

Section 1622 provides: "Whoever procures another to commit any perjury is guilty of subornation of perjury . . .." The express language of this statute embraces the procuring of another to commit "any perjury," not just "such perjury as defined in § 1621." While it is clear that the perjury and false declaration statutes are not equivalents, it is equally clear that § 1623 is a species of perjury.*fn5 Indeed, as previously rehearsed, the intent of § 1623 was to "facilitate Federal perjury prosecutions." 1970 U.S. Code Cong. & Ad. News, supra, at 4008. Therefore, we hold that the words "any perjury" in § 1622 include the making of any false declaration under § 1623.*fn6

Having disposed of appellant's statutory crime argument, we turn to his "two-witness rule"*fn7 contention. Appellant concedes, as he must, that Congress eliminated the two witness requirement for prosecutions under the false declaration statute, § 1623. However, he somehow believes that the crime of subornation ...


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