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United States v. Fischbach and Moore Inc.

December 10, 1984

THE UNITED STATES V. FISCHBACH AND MOORE, INC., THE HOWARD P. FOLEY COMPANY, LORD ELECTRIC COMPANY, INC., SARGENT ELECTRIC COMPANY, E.C. ERNST, INC., TRI-CITY ELECTRIC COMPANY, INC., JOSEPH J. RODGERS, PAUL E. ARBOGAST, FREDERIC B. SARGENT, RALPH D. VRYENHOEK, JAMES L. OESTERLE. SARGENT ELECTRIC COMPANY, APPELLANT IN NO. 84-3242; THE UNITED STATES
v.
FISCHBACH AND MOORE, INC., THE HOWARD P. FOLEY COMPANY, LORD ELECTRIC COMPANY, INC., SARGENT ELECTRIC COMPANY, E.C. ERNST, INC., TRI-CITY ELECTRIC COMPANY, INC., JOSEPH J. RODGERS, PAUL E. ARBOGAST, FREDERIC B. SARGENT, RALPH D. VRYENHOEK, JAMES L. OESTERLE. FREDERIC B. SARGENT, APPELLANT IN NO. 84-3243; THE UNITED STATES
v.
FISCHBACH AND MOORE, INC., THE HOWARD P. FOLEY COMPANY, LORD ELECTRIC COMPANY, INC., SARGENT ELECTRIC COMPANY, E.C. ERNST, INC., TRI-CITY ELECTRIC COMPANY, INC., JOSEPH J. RODGERS, PAUL E. ARBOGAST, FREDERIC B. SARGENT, RALPH D. VRYENHOEK, JAMES L. OESTERLE, RALPH D. VRYENHOEK, APPELLANT IN NO. 84-3244. THE UNITED STATES V. FISCHBACH AND MOORE, INC., THE HOWARD P. FOLEY COMPANY, LORD ELECTRIC COMPANY, INC., SARGENT ELECTRIC COMPANY, E.C. ERNST, INC., TRI-CITY ELECTRIC COMPANY, INC., JOSEPH J. RODGERS, PAUL E. ARBOGAST, FREDERIC B. SARGENT. RALPH D. VRYENHOEK, JAMES L. OESTERLE, PAUL E. ARBOGAST, APPELLANT IN NO. 84-3253; THE UNITED STATES V. FISCHBACH AND MOORE, INC., THE HOWARD P. FOLEY COMPANY, LORD ELECTRIC COMPANY, INC., SARGENT ELECTRIC COMPANY, E.C. ERNST, INC., TRI-CITY ELECTRIC COMPANY, INC., JOSEPH J. RODGERS, PAUL E. ARBOGAST, FREDERIC B. SARGENT, RALPH D. VRYENHOEK, JAMES L. OESTERLE. JOSEPH J. RODGERS, APPELLANT IN NO. 84-3266; THE UNITED STATES V. FISCHBACH AND MOORE, INC., THE HOWARD P. FOLEY COMPANY, LORD ELECTRIC COMPANY, INC., SARGENT ELECTRIC COMPANY, E.C. ERNST, INC., TRI-CITY ELECTRIC COMPANY, INC., JOSEPH J. RODGERS, PAUL E. ARBOGAST, FREDERIC B. SARGENT, RALPH D. VRYENHOEK, JAMES L. OESTERLE. LORD ELECTRIC COMPANY, APPELLANT IN NO. 84-3267. THE UNITED STATES V. FISCHBACH AND MOORE, INC., THE HOWARD P. FOLEY COMPANY, LORD ELECTRIC COMPANY, INC., SARGENT ELECTRIC COMPANY, E.C. ERNST, INC., TRI-CITY ELECTRIC COMPANY, INC., JOSEPH J. RODGERS, PAUL E. ARBOGAST, FREDERIC B. SARGENT, RALPH D. VRYENHOEK, JAMES L. OESTERLE, FISCHBACH AND MOORE, INCORPORATED, APPELLANT IN NO. 84-3268



Appeal from the United States District Court for the Western District of Pennsylvania - Pittsburgh

Author: Aldisert

Before: ALDISERT, Chief Judge, HUNTER and WEIS, Circuit Judges.

Opinion OF THE COURT

ALDISERT, Chief Judge.

Three principal issues are presented in this appeal from sentences imposed on a guilty verdict in a criminal anti-trust prosecution: whether the proof at trial varied from the indictment charging a single, continuing conspiracy; whether the government introduced sufficient evidence to prove the interstate commerce element of the Sherman Act violation; and whether this court should set aside or modify, on appeal, the one million dollar fine levied against defendant Fischbach & Moore. Appellants assert several less significant arguments, including the admission of an allegedly prejudicial government exhibit; prosecutorial misconduct during closing argument; errors in jury instructions; and the denial of a continuance to defendant Arbogast. Because we find no reversible error, we affirm the judgment of the district court.

I.

For approximately seven years, from 1974 to 1981, representatives of several electrical contracting companies met at the Duquesne Club in Pittsburgh. The purpose of these meetings was to allocate electrical construction projects, by bid rigging, at the Western Pennsylvania Works (Works) of United States Steel (USS). Whenever one of the companies desired to rig a bid, that company's representative would telephone the other contractors and arrange a meeting. After deciding among themselves which firm would receive the contract, that firm's representative would contact the other contractors and would tell them what bid to submit, ensuring that his firm's bid would be the lowest. Some of the firms kept track of the allocations to ensure that each contracting company received its fair share of work.

As a result of investigating this bid rigging scheme, the government accused a number of the electrical contractors and their employees of antitrust violations. The indictment charged them with violating § 1 of the Sherman Act by conspiring to allocate electrical construction projects at the Western Pennsylvania Works, to fix the prices at which those projects were bid, and to submit noncompetitive, collusive, and rigged bids on those projects. Although some of the defendants plea bargained to the charges and avoided trial, three electrical contracting companies, Fischbach and Moore (F&M), Sargent Electric, and Lord Electric, and four individual employees, Paul Arbogast, Joseph Rodgers, Frederic Sargent, and Ralph Vryenhoek, stood trial on the charges. They are the appellants before us.

Prior to trial, one of the defendants, Paul Arbogast, was indicted and prosecuted in Montana for an unrelated Sherman Act violation. The district court postponed the Western Pennsylvania trial once because of the Montana action. In mid-January 1984, Arbogast again moved for a continuance, the Montana trial not having ended and the Western Pennsylvania trial scheduled to begin in early February. The court denied this motion. Arbogast was acquitted in Montana on January 21 and began trial in Pittsburgh on February 6.

To narrow the scope of the trial, the government issued a bill of particulars, which it later amended, identifying contracts within the scope of the conspiracy. The proof at trial related to some, but not all, of the contracts on this list. The government also introduced extensive evidence to prove the interstate commerce jurisdictional element. This evidence included Government Exhibit 32 (Govt. Ex. 32), a file of invoices and freight bills for electrical materials and equipment bought by USS from out of state vendors for use in electrical constructions projects at the WPW.

After a finding of guilty by the jury, the district imposed both fines and prison sentences on the individual defendants. The three corporate defendants received fines of one million dollars each, the statutory maximum under § 1 of the Sherman Act. Defendants now appeal their convictions, and have asserted a long list of contentions, requiring this opinion to be more lengthy than what we believe to be appropriate in this court.

II.

Appellants raise three principal contentions. First, appellants F&M, Lord Electric, Sargent Electric, Paul Arbogast, and Joseph Rodgers allege a variance between the proof and the indictment. In a related argument, F&M, Lord Electric, Ralph Vryenhoek, and Frederic Sargent allege that the government did not prove the interstate commerce element of the Sherman Act charge. In the third major contention, F&M alleges both that its sentence was illegal and that the trial court abused its discretion in imposing sentence.

The precepts guiding our review of the variance argument are familiar. Our polestar is to determine whether "there is substantial evidence, viewed in the light most favorable to the Government, to uphold the jury's decision." United States v. Palmeri, 630 F.2d 192, 203 (3d Cir. 1980)(Quoting Burks v. United States, 437 U.S. 1, 17, 57 L. Ed. 2d 1, 98 S. Ct. 2141 (1978)), cert. denied, 450 U.S. 967, 101 S. Ct. 1484, 67 L. Ed. 2d 616 (1981). Additionally, Kotteakos v. United States, 328 U.S. 750, 66 S. Ct. 1239, 90 L. Ed. 1557 (1946), sets forth the two-pronged test appellants must meet to succeed in this specific contention: (1) that there was a variance between the indictment and the proof and (2) that the variance prejudiced some substantial right of the defendants. Id. at 752, 756.

In the usual criminal case, our review of a sentence imposed by the district court is extremely circumscribed. United States v. Felder, 706 F.2d 135, 137 (3d Cir. 1983).*fn1 Generally, if the sentence falls within the statutory maximum, the matter is not reviewable on appeal. United States v. Dickens, 695 F.2d 765, 782 n. 26 (3d Cir. 1982), cert. denied, 460 U.S. 1092, 103 S. Ct. 1792, 76 L. Ed. 2d 359 (1983). We may review the sentence, however, if there is a showing of illegality or abuse of discretion. United States v. Fessler, 453 F.2d 953, 954 (3d Cir. 1972). We now consider appellants' variance argument.

III.

Appellants F&M, Sargent Electric, and Paul Arbogast argue that because the government's evidence sought to establish multiple conspiracies and not the single, continuing conspiracy charged in the indictment, the convictions must fall as illegal. They allege variance in two respects: (1) that the government interpreted the indictment to charge that all electrical contracting bids were rigged during the time of the conspiracy, later reducing the number of bids in the bill of particulars and further reducing them at trial and (2) that the government proved not one continuing conspiracy, but a series of independent conspiracies, i.e., that each contract the government proved the defendants rigged constituted a separate conspiracy.

A.

The indictment charged that the defendants conspired to "allocate among themselves electrical construction projects" at the Works; to "fix the prices at which electrical construction projects" were bid; and to "submit noncompetitive, collusive, complementary and rigged bids." App. at 21a-22a.But the indictment did not state that the conspiracy encompassed all bids or all contracts made during the seven-year period. Although the government so stated at a pre-trial conference, even if the appellants relied on these government representations or the bill of particulars as to the extent of proof, neither can modify the scope of the indictment. United States v. Critchley, 353 F.2d 358, 362 (3d Cir. 1965)(bill of particulars).

Even had the indictment read in terms of "all construction projects" and "all bids," the government still would have introduced sufficient evidence to prove the crimes charged. To prove a conspiracy to rig all bids, the government was not required to show that the defendants actually rigged all bids. United States v. Socony-Vacuum Oil Co., 310 U.S. 150, 224, 84 L. Ed. 1129, 60 S. Ct. 811 n. 59 , (1940). The defendants could have conspired to rig all bids, but failed to achieve that objective for one reason or another, e.g. because the bid lists included companies with which the defendants could not cooperate. Evidence of the fourteen rigged bids both proved that a conspiracy to rig bids existed and permitted the jury to conclude that the conspiracy encompassed all bids.

B.

We also conclude that the government introduced sufficient evidence to justify a jury finding of only a single conspiracy. The government proved that the defendants met, over a period of several years, at the Duquesne Club for the sole purpose of rigging bids and allocating contracts. The government introduced evidence to prove that all the participants knew the purpose of the club meetings and that they met as a group, thus negating the argument that separate groups of the defendants were conspiring together, with the same goal, but with their actions unconnected. More important, the government showed that some of the defendants kept records of which company received which job, ensuring that each firm would receive its fair allotment of the contracts. This recordkeeping indicated a single conspiracy that continued over time, and not separate conspiracies involving only certain contracts.

Because we hold that defendants did not prove a variance between the proof and the indictment, we need not consider ...


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