United States by depriving it of its money and property, by corrupting and deceiving its officers and employees assigned to make inspections at the plant of the said company, by depriving it of the honest and efficient services of certain of its said officers and employees, and by circumventing, defeating and frustrating the safeguards and inspection processes established by the Department of the Army for its protection in the purchase of meat products.' This paragraph of the indictment then continues 'The form and substance of the conspiracy was as follows:' Then follow seven paragraphs in all but one of which it is alleged that 'It was a part of the conspiracy that the defendant(s)' by various methods would make false claims upon the United States and 'would claim and receive payment for the same from the United States.' The solitary exception to the above is the single paragraph alleging defendants' corruption of certain Army inspectors, obviously for that same purpose.
The pleading defendants claim that this indictment charges simply a conspiracy to corrupt an Army inspector by bribing him. Clearly, however, such a construction would nullify the bulk of the allegations of the indictment. Further, by no stretch of the imagination could the corruption of an Army inspector be considered per se to be its own end and aim. Nor does the indictment, while specifically reciting statutes which prohibit the knowing presentation of false claims for payment by the United States, any where cite the statute prohibiting bribery, Section 201, Title 18 U.S.C. On the other hand, when these relatively brief allusions to the bribery of the inspector are read in conjunction with the bulk of the charges of the indictment, it is quite clear that such bribery is set forth as one of the means used by the defendants to effectuate the conspiracy, along with the many others there alleged. Or, perhance, it might be considered to allege one of the characteristics of the unlawful understanding itself, the indictment itself in every part clearly pointing, as its end and aim, to a conspiracy to claim and receive payment from the United States of knowingly false claims.
If, then, this bribery allegation is but the statement of one of the many 'means * * * used in effectuating the conspiracy', the plea to the indictment does not constitute an admission of his bribery under the above authorities. Though defendants, from their above contention, evidently admit this bribery in fact. Or, if the bribery is read as alleging one of the essential characteristics of the indictment pleaded to, then, by the same token, the plea would have admitted it. But in any event, whether alleged as one of many means of effectuation, or as constituting an essential characteristic of the conspiracy, such allegation could in no wise militate against the definite admission by the plea that the conspiracy was participated in by the pleading defendants, and was one primarily to obtain the payment of a knowingly false claim by the United States.
These judicially admitted issues are, as seen above, the identic issues, basic to the over-all conspiracy alleged in the amended civil complaint under the pre-trial order. Such issues therefore cannot be re-litigated, but are conclusively and finally established against the defendants who pleaded to the indictment. Indeed, there is some question whether Count 1 of the indictment does not allege a conspiracy that was effectuated. Note the allegations in paragraphs 9, 10, 11, 12, 13, 14 and 15 of the indictment count pleaded to, that as 'a part of the conspiracy' the defendants would commit a series of frauds culminating in knowingly false representations to the United States, as a result of which 'the said defendants would claim and receive payment for the same from the United States.' But since such allegation, being also alleged to be 'the form and substance of the conspiracy' could also be read as simply characterizing the illegal plan which defendants had in mind, as distinguished from the effectuation of such plan, this ambiguity must be construed in favor of the defendants sought to be estopped by their plea. United States v. American Packing Corp., supra. Thus defendants' pleas cannot be held to estop them from contesting the effectuation of the admitted conspiracy, some of which are alleged in counts 2 and 3 of the indictment not pleaded to, and as alleged in the 400-odd other counts of the complaint.
In addition, it will be recalled that the above statutes, upon which the civil complaint is based, authorize a suit against those conspiring to defraud the United States by obtaining, or aiding to obtain, the payment of a knowingly false claim, as causes of action entirely separate and distinct from a cause of action based upon either the presenting of a knowingly false claim or the using of false certificates to obtain the payment of a false claim. For every such conspiracy not only may double damages, with costs, be recovered, but, in addition, a $ 2,000 forfeiture.
Defendants argue that even though they have finally admitted this conspiracy, carrying this forfeiture in its wake, they are not now liable to plaintiff therefor, because they did not judicially admit that the conspiracy had been in fact effectuated by the claiming, presenting and obtaining the payment from the United States of knowingly false claims. And they cite authorities to the effect that at common law a civil conspiracy does not entail liability unless the plaintiff can show it has been damaged thereby. However, the conspiracy alleged in the present civil complaint is not a common law conspiracy, but one created by the will of the Congress, and our highest court has already held this statute to mean that damage need not accrue in fact to the United States before a forfeiture is recoverable. United States ex rel. Marcus v. Hess, 1942, 317 U.S. 537, 63 S. Ct. 379, 87 L. Ed. 443; U.S. v. Rohleder, 3 Cir., 1946, 157 F.2d 126.
Defendants further argue that the recovery of this forfeiture, in addition to their sentence on the above indictment, constitutes double punishment, which they claim to be the equivalent of unconstitutional double jeopardy. But this same argument was raised before the United States Supreme Court in Marcus, which called attention to the fact that the statute in question was not criminal, so that the constitutional double jeopardy clause did not apply, the forfeitures and double damages being similar to punitive damages, recoverable, regularly, in a civil action at common law. Thus Congress had the clear power to impose such forfeitures, regardless of any previous criminal sentence which defendants might have incurred.
An order may be presented accordingly.