Lopez v. United States

PETITIONER: German S. Lopez
RESPONDENT: United States
LOCATION: Clauson's Inn

DOCKET NO.: 236
DECIDED BY: Warren Court (1962-1965)
LOWER COURT: United States Court of Appeals for the First Circuit

CITATION: 373 US 427 (1963)
ARGUED: Jan 14, 1963
DECIDED: May 27, 1963
GRANTED: Oct 15, 1962

ADVOCATES:
Edward J. Davis - for the petitioner
Louis F. Claiborne - for the respondent

Facts of the case

On August 31, 1961, Internal Revenue Agent Roger S. Davis visited Clauson’s Inn, located in North Falmouth, Massachusetts, as part of an investigation into possible tax evasion. He spoke with German S. Lopez, who operated the inn, to determine whether there was any dancing or other form of evening entertainment. Lopez denied it, but when Davis returned later that night, he saw dancing in the lounge and bar. On October 21, Davis returned to tell Lopez that the Inn might owe a cabaret tax and requested the Inn’s financial records. Lopez suggested that the two could reach an “agreement” and offered Davis $420 with a promise of more money if he dropped the issue. In Lopez’s version of the events, the money was for Davis to prepare the paperwork and put the Inn’s books in order. Lopez agreed to file paperwork for the current quarter and asked Davis to come back on October 24. Davis reported the meeting and turned the money over to his superior. When he returned on October 24, Davis wore a recording device. As they discussed Lopez’s tax liability, Lopez emphasized that he wanted Davis “on [his] side” and gave him more money.

Lopez was charged with four counts of attempted bribery of an internal revenue agent. Prior to trial, Lopez filed a motion to suppress the recorded evidence, and the motion was denied. He was convicted on three of the counts in district court. Although the defense did not focus on entrapment, the trial court judge provided jury instructions on the issue. The United States Court of Appeals for the First Circuit affirmed.

Question

(1) Did the IRS agent’s actions toward the petitioner constitute entrapment?

(2) Was the use of the wire recording of a conversation between the petitioner and the IRS agent as evidence a violation of the Fourth Amendment?

Media for Lopez v. United States

Audio Transcription for Oral Argument - January 14, 1963 in Lopez v. United States

Earl Warren:

Petitioner Versus United States number 236 on the docket.

Mr. Davis?

Edward J. Davis:

Mr. Chief Justice may it please the Court.

This case here is here on certiorari on question one; the petitioner relies on Rule 52(b) of the Federal Rules of Criminal Procedure.

The petitioner was indicted on four counts, on bribery charges alleged to have been committed in violation of Title 18 U.S.C., Section 201.

The petitioner was found not guilty on count one, which alleged that the petitioner bribed United States Revenue Agent, Roger S. Davis on October 24, 1961 and violated [Inaudible] to refrain from making an examination of books and records relating to sales and receipts of the bar and lounge at Clauson's Inn, Falmouth, Massachusetts in the years 1959 and 1960 and the first two quarters of the year 1961 from computing tax on said sales and receipts and reporting the same to the Internal Revenue Service.

The tax alleged is a cabaret exercise tax that would attach if the operation was conducted with the entertainment of singing or dancing in connection with the playing of the orchestra or jukebox.

There was evidence at the trial to support the charge in count one that the petitioner offered Agent Davis a bribe of $420 on October 21, 1961.

On the record of the trial, there was no dispute that the petitioner gave and Agent Davis received $420 on October 21, 1961.

The issue was, whether it was given and received as a bribe and the jury decided that is was not a bribe under the charge.

Counts two, three and four alleged that the petitioner bribed Agent Davis on October 24, 1961 with intent to influence him to conceal from the government the sales and receipts of any cabaret tax due thereon for the petitioner's operation of the bar and lounge at Clauson's Inn for the years 1959, 1960, 1961 and thereafter.

The jury returned guilty verdicts in counts two, three and four.

The uncontroverted facts established by the government's evidence are set out for record references on pages 6 to 16 of the petitioner's brief.

The facts show as follows: First of all, the record is darn of any activity in the petitioner's business operation at Clauson's Inn, showing that the petitioner conducted, held out or knowingly permitted the singing or dancing entertainment that would create the tax liability prior to October 16, 1961, at which time the policy was changed to offer such entertainment as shown on the books of the petitioner and on the defendant's Exhibit D in the record.

Further at the trial, Government Agent Davis testified that he knows no basis for a cabaret tax liability on the operation prior to August 31, 1961.

The Revenue Inspection Service organized a plan to entrap the petitioner by arranging for Agent Davis to go to Clauson's Inn on October 24, 1961 and meet with the petitioner at the petitioner's private office according to their stated purpose, to relate back, the conversation of Davis and the petitioner to the meeting of October 21, 1961.

Agent Davis testified that his agreement with the petitioner was to return to the premises so that he could file a return if due.

Agent Davis came to Clauson's Inn on October 24, 1961 in concert with other agents with a Minifon on his person.

Invited himself into the petitioner's office and the Minifon recorded what the petitioner and Agent Davis said and did at the meeting.

The Minifon recording is an evidence over objection and shows at the outset of the meeting of October 24, 1961, that the plan was frustrated by a statement of the petitioner stating, “I never did thought a cabaret tax, I never thought there was a need of it.”

This statement registered the mind of the petitioner then and there with the force of a verbal act.

Notwithstanding this statement, agent Davis proceeded to convert his operation into the making of cabaret tax claims, false and fictitious in view of the fact that he knew of no basis of cabaret tax for 1959, 1960 and 1961 prior to August 31, 1961.

And that these statements of fact of claims were grossly false and grotesque in relation to the petitioner's operation.

Agent Davis stated to the petitioner at this meeting on October 24, 1961, a claim of tax penalties, which was false on the facts.

Immediately following this claim of penalty, agent Davis made the thrust for the bribe, “Now, I don't want to get greedy or anything, but well what would you be gaining?”

In effect, the request for the bribe and the bribe resulted pursuant to the request.

As under Sherman against United States conduct of the government agents relevant and important and the conduct cannot be disclaimed by the government, with respect to the facts that I have stated here, I would ask the Court's attention for the following.

Referring to the meeting of October 21, 1961 the testimony of Agent Davis was, “I told him,” referring to the petitioner, “I asked him how much money was on the desk and he said $420.

About that time I picked the money up, it was about 10 o'clock.

I put it in my pocket and left his office.”