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UNITED STATES v. GROSSMAN

July 12, 1957

UNITED STATES of America
v.
Samuel GROSSMAN, Charles Trachtenberg and Sanford Storm



The opinion of the court was delivered by: HARTSHORNE

Defendants have made a series of motions, and the Government certain related counter-motions, in these cases, in which Indictments have been filed charging the making and using of false statements in a matter within the jurisdiction of the Veterans Administration, specifically affecting certain Home Loan guarantees, in violation of 18 U.S.C. 1001. Grossman is the sole defendant in Indictment No. 135-57, which deals with a different transaction from that involved in Indictment No. 150-57, where defendants Trachtenberg and Storm are also involved. Count I of the latter Indictment charges a conspiracy which had as its alleged ultimate purpose the purchase by one Joseph Caldwell, a non-veteran, of a home financed by a Veterans Administration guaranteed loan through the use of dummy veteran purchasers. In addition, this Indictment contains five substantive counts each setting up a separate false document used in this one general transaction.

I. Defendant Trachtenberg, relying on the recent decision of the United States Supreme Court in Jencks v. United States, 1957, 77 S. Ct. 1007, 1013, moves for the pre-trial production of separate statements of the veteran and his wife, the Andersons, and the non-veteran, Caldwell, given on the one hand to the F.B.I., and on the other to the Grand Jury.

 In Jencks, at trial, a Government witness had testified as to certain acts of the defendant material to the charge against him. The defense, knowing that this witness had made certain reports to the F.B.I. covering the matters to which the witness had thus testified, asked that these reports be produced for inspection by the Court, to see if they could be used to impeach the credibility of the witness' testimony. The Trial Court denied this application, on the ground that the defense had not yet shown any inconsistency between the testimony and the report. This ruling the United States Supreme Court reversed, saying:

 'Because only the defense is adequately equipped to determine the effective use for purpose of discrediting the Government's witness and thereby furthering the accused's defense, the defense must initially be entitled to see them (the reports) to determine what use may be made of them. Justice requires no less.

 But it will be noted that in Jencks the Supreme Court was dealing with a situation which arose, not months before trial as here, due to the impending summer recess, but at trial. As the Court says, the inspection of the report by the defense was 'for purpose of discrediting the Government's witness * * * with a view to use on his cross-examination * * *.' That Jencks in no wise deals with discovery before trial is also indicated by the fact that its opinion does not even refer to Rules 16 or 17 of the Federal Rules of Criminal Procedure, 18 U.S.C.A., covering discovery before trial. In addition, Judge Palmieri, in the Southern District of New York, in United States v. Benson, D.C.1957, 20 F.R.D. 602, and Judge Moore, in United States v. Anderson, D.C.E.D.Mo.1957, 154 F.Supp. 374, refused pre-trial discovery of statements to the F.B.I., despite Jencks.

 The arguments against the discovery defendants now seek are forceful. At this time it is not certain that the persons, whose reports to the F.B.I. are asked, will ever testify as to the matters covered by such reports. The Government may choose not to use these people as witnesses, casualties concerning future trials constantly occur, and the persons involved, for reasons not presently known, may be unavailable as witnesses. Since Jencks dealt only with an attack on the credibility of witnesses, if any of these latter situations arise, the Government would have been compelled to disclose possibly confidential information to the defendants, all to no legitimate defense purpose.

 In addition, such an inspection before trial would amount to a statement by the Government, as to whom its witnesses will be. This, in non-capital cases, the law does not authorize. 18 U.S.C. ┬ž 3432.

 Defendants answer that the pattern of Government prosecution in similar cases has made it clear that there is no doubt that in fact the Andersons and Caldwell will be witnesses. Thus pretrial disclosure of their statements will not give the defendants any information as to the identity of the Government's witnesses that is not quite clear to them at present. Defense further contend that it will unduly disrupt and delay the trial to wait until then to give to the defense for the first time the statements of the witnesses. Time will have to be given them to read, digest and investigate, and to discuss these statements with their clients. Similarly, the defense claims that it would be unfair to them to have to read, digest, and investigate these statements while under the extreme pressure of actual trial.

 But these are both matters which can be properly taken care of by the Trial Judge, perhaps as was done by Marshall, C.J., when he presided at the trial of United States v. Burr, 25 Fed.Cas. page 187, No. 14,694, specially noted in Jencks. There that famous jurist passed on essentially the same question, but after the case had been called for trial, and before the jury had been impaneled. This course of procedure obviates both the above defense objections, since defense then, before the Government even opens its case, can be given adequate time to inspect the statements in question, and this without delaying the actual trial in the slightest. *fn1" At the argument, the Government called attention to the lack of value to the defense, and the great injustice to the public, were the witness' statement to the Government in question to cover not only the subject of his trial testimony, but quite separately, a totally different matter, involving a state secret. This situation -- where the statement in question deals separately with two disconnected transactions -- was apparently not before the Court in Jencks. Nor does the Government now claim that the statements here given by Caldwell or the Andersons contain state secrets, or concern transactions other than that to which they are expected to testify at the trial. Thus this Court is not now faced with this problem, left open in Jencks, and it naturally will not rule thereon.

 Since, normally, Grand Jury proceedings are to be kept secret, F.R.Cr.P. 6(e), it similarly follows that, since defense have no present need to see the statements of these witnesses, either to the Grand Jury or to the F.B.I., when such need can be properly met at, or on the eve of, trial, the present applications of the defense in that regard will also be denied as premature.

 II. Defendant Grossman moves 'to produce and permit Samuel Grossman to inspect and to copy each and every document upon which the Government will rely * * * as part of their proofs.' This motion must be denied, since the books, papers and documents requested are not sufficiently 'designated', the motion does not show that they belonged to the defendant or were 'obtained from others by seizure or by process', nor is there any showing that 'the items sought may be material to the preparation of (the defense).' Thus none of the requisites of Rules 16 or 17(c) of the Federal Rules of Criminal Procedure is met.

 III. The defendants move to dismiss the Indictment because the defendants were called before the Grand Jury even though they allege they were marked for prosecution at the time they were called. It is conceded that the defendants were then told of their Fifth Amendment rights, but not then told that they were marked for prosecution.

 Defense contend that when the defendants are the target of Grand Jury investigation it is improper to call them before the Grand Jury at all, and that any Indictment found thereafter is fatally defective, whether they were warned or not. This has been held to be the law in several states, e.g., People v. Bermel, Sup.Ct.1911, 71 Misc. 356, 128 N.Y.S. 524; People v. Gillette, 126 App.Div. 665, 111 N.Y.S. 133, and is implicit in one, not recent, Federal Court decision, United States v. Edgerton, D.C.D.Mont.1897, 80 F. 374. The Government answers that at the time the defendants were called before the Grand Jury it was a John Doe investigation, and in fact, they were not 'targets' of the investigation. ...


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