Grunewald v. United States

RESPONDENT: United States
LOCATION: Quality Photo Shop

DECIDED BY: Warren Court (1957-1958)
LOWER COURT: United States Court of Appeals for the Second Circuit

CITATION: 353 US 391 (1957)
ARGUED: Apr 03, 1957 / Apr 04, 1957
DECIDED: May 27, 1957

Facts of the case


Media for Grunewald v. United States

Audio Transcription for Oral Argument - April 04, 1957 (Part 2) in Grunewald v. United States
Audio Transcription for Oral Argument - April 04, 1957 (Part 1) in Grunewald v. United States

Audio Transcription for Oral Argument - April 03, 1957 in Grunewald v. United States

Earl Warren:

Number 183, Henry Grunewald versus United States of America.

Number 184, Max Halperin, Petitioner, versus United States of America and Number 186, Daniel A. Bolich, Petitioner, versus United States of America.

Mr. Bennett.

Edward J. Bennett:

May it please the Court.

Henry Grunewald, the petitioner in Number 183 together with the other two petitioners was convicted in the Southern District of New York of conspiracy to bring about corrupt Revenue Department decisions and fraud of the United States and to conceal the crime from all investigating agencies in the future.

The significant feature for present purposes is that element of concealment because without it prosecutions of the crime would have been barred admittedly by the statute of limitations and it is admitted by the Government, was conceded upon the trial that they had proven no act within the limitations period except an act of concealment.

The conviction on this conspiracy count, which is count one of the indictment in the record, was affirmed by the Court of Appeals for the Second Circuit with Judge Frank dissenting.

The majority held that there was, as part of the original crime, a conspiracy to conceal for all the future and therefore subsequent acts of concealment sufficed to bring the original crime down within the period of the statute of limitations.

Judge Frank's dissenting held that the conviction was improper under the principles stated by this Court in the Krulewitch case and the Lutwak case in which this Court held that no conspiracy to continue to conceal a crime which had been accomplished would be implied from the crime itself and that subsequent acts of concealment would not serve to extend the life of the conspiracy because it would destroy the statute of limitations and would make one man, who would conspire with another, responsible for the other's acts for all the future.

For example, if he went out three or four years after the crime and shot a witness, if you are going to imply a conspiracy to conceal, why all of the original conspirators would be responsible.

Now, in order to see how those principles fit into this case, I should give Your Honors a brief outline of the facts.

In 1948, there were two corporate taxpayers who are being investigated for income tax fraud by the Fraud Bureau of the Internal Revenue.

The function of that Bureau was to determine whether or not to recommend criminal prosecution.

And under their administrative practice if at any point in their investigation they determine not to recommend criminal prosecution, the criminal phase ends and the matter is then remitted to the civil side for assessment of taxes, penalties, whatever it may be.

The point is that the critical thing in such an investigation is to get a recommendation of no criminal prosecution.

Both of these taxpayers, one was named Gotham Beef Company and the other Patullo Modes were represented by the same firm of attorneys in New York.

That firm headed up by a man named Davis.

Davis was a Government witness and testified that through the petitioner Halperin, help was obtained from the petitioner Grunewald, whom I represent, to bring about that recommendation.

The theory being that Grunewald was a friend of the third petitioner, Bolich who during the period in question was an official in the Internal Revenue Department.

During part of the time he was the head of the New York office of the Fraud Bureau and thereafter was an Assistant Commissioner of Internal Revenue with authority in the premises.

The Gotham Beef Company decision came down in October 1948, no criminal prosecution.

On January 10, 1949, the Patullo Modes decision was announced, no criminal prosecution.

The indictment in this case was found October 25, 1954, a lapse of almost six years with admittedly a three-year statute of limitation.

Now, how is the gap filled?

In February of 1952, there was impaneled in Brooklyn, New York a grand jury to investigate these cases and perhaps others.

That grand jury subpoenaed before it at least three witnesses from the two taxpayer companies and it appeared that in February and March on three different occasions at one point Davis spoke to one of those witness, Davis was the attorney who had represented the taxpayers originally.

Davis spoke to one of them and found out he was going to testify and said he was crazy to do so and he ought to at least to consult some other attorneys and his current attorneys before he did it.

On two other occasions, Mr. Halperin, the petitioner in 184 I believe it is, spoke to the other two witnesses and said he was going to rely on his constitutional rights.

He was going to stand silent.

He has been subpoenaed also before the grand jury and he thought it would be a wise thing for everybody to do so and perhaps the whole thing would flow over.