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UNITED STATES v. HUGHEY

November 20, 1953

UNITED STATES
v.
HUGHEY.



The opinion of the court was delivered by: Lemley, Chief Judge.

This cause comes on for hearing upon the defendant's renewed motion for a judgment of acquittal, coupled with an alternative motion for a new trial; said motions have been submitted upon defendant's written brief and oral argument.

The defendant was tried and convicted upon an indictment charging that on or about December 21, 1952, and prior thereto, she had carried on the business of a retail liquor dealer and had wilfully failed to pay the special tax required by law, in violation of 26 U.S.C.A. § 3253.*fn1 At the conclusion of the Government's evidence, defendant moved for a verdict of acquittal, upon which motion we reserved our ruling; the defendant offered no evidence, and the case was submitted to the jury which returned a verdict of guilty. Thereafter, and within apt time, the defendant filed the instant motion as authorized by Rule 29(b) of the Federal Rules of Criminal Procedure, 18 U.S.C.A. In her said motions, the defendant challenges the sufficiency of the evidence to justify the submission of the case to the jury or to sustain the verdict; she contends further that the evidence "clearly demonstrates an entrapment as a matter of law"; that we erred in refusing to instruct the jury that the witness, Bennett, an agent of the Federal Alcohol Tax Unit, was an accomplice whose testimony should be received with great caution; that we erred in admitting secondary evidence of the contents of a number of bottles seized by Federal agents at the home of the defendant and of the labelling on said bottles; and that we erred in admitting testimony concerning an admission made by the defendant to the officers at the time of her arrest.

The evidence relied upon by the Government to convict was substantially as follows:

Around noon on Sunday, December 21, 1952, Howard J. Bennett and William A. Tolleson, investigators of the Alcohol and Tobacco Tax Division of the Treasury Department, commenced an observation of defendant's home, which is located on East 36th Street on the outskirts of Texarkana, Arkansas; in the course of their vigil, they observed ten or twelve men enter and leave the defendant's house; after observing these transactions for approximately forty-five minutes, Bennett and Tolleson left, and Bennett returned about an hour and a half later. He approached the house and was admitted by the defendant; upon entering, he purchased from the defendant without difficulty a fifth of Schenley's Black Label Whiskey, paying therefor $7.50. This whiskey was in a standard bottle, which was full and sealed, and which had affixed to it the proper amount of revenue stamps. After buying the whiskey, Bennett took it to the home of Mr. Tolleson, who broke the seal, opened the bottle and tasted the contents in the presence of Mr. Bennett, ascertaining that it was whiskey. Thereafter, Tolleson retained this bottle and it was introduced in evidence at the trial. Later on the same day, Bennett and Tolleson obtained a search warrant from the United States Commissioner, and, accompanied by one W.W. Alexander, revisited the defendant's home. After identifying themselves as Federal officers, they inquired of the defendant whether or not she had a Federal retail liquor dealer's permit; she replied that she had no such permit, that she had been in business for seven years and had never obtained one.*fn2 Thereafter, the officers searched the house and found a number of full bottles, having the total capacity of four and one-half gallons, bearing the labels of wellknown brands of whiskey concealed under a bed and in a cabinet in the same room. Mr. Tolleson took charge of these bottles which were in fifth, pint and halfpint sizes, and which were full and sealed and bore internal revenue stamps. Aftter the seizure Tolleson carried said bottles, with contents intact, to the offices of the Alcohol and Tobacco Tax Division at Little Rock, but in some undetermined way, they, together with their contents, disappeared prior to the trial and their present whereabouts are unknown. Mr. Bennett was able, however, to testify in detail as to the descriptions of the several bottles and the labels thereon.

In considering the defendant's motions we, of course, view the testimony in the light most favorable to the Government, and when it is so viewed, we are satisfied that there was substantial evidence from which the jury could find that the defendant was engaged in the business of a retail liquor dealer within the meaning of the law and that she wilfully failed to pay the special tax imposed upon such dealers.

It is well settled that evidence of a single sale is sufficient to sustain a conviction under Section 3253 where there are corroborating circumstances tending to show that the defendant was engaged in the retail liquor business and had liquor on hand, or was ready and able to procure it, for the purpose of selling it to such persons as he or she might accept as customers. Bailey v. U.S. 6 Cir., 259 F. 88; Sodini v. U.S. 6 Cir., 261 F. 913; Conyer v. U.S. 6 Cir., 80 F.2d 292; Johnson v. U.S. 5 Cir., 84 F.2d 114; Wilson v. U.S. 6 Cir., 149 F.2d 780; U.S. v. 673 Cases of Distilled Spirits and Wines, D.C.Minn., 74 F. Supp. 622. That the Court of Appeals for this Circuit is in accord with the foregoing cases appears from Taran v. U.S. 8 Cir., 88 F.2d 54, wherein Bailey v. U.S. and Sodini v. U.S. both supra, were cited with approval.

In the Taran case the defendant was indicted for engaging in both the retail and wholesale liquor business without paying the special taxes imposed by law, and the Court in upholding his conviction said:

    "* * * There was direct evidence that
  defendant, * * *, was selling the liquor in
  quantities of less than five gallons, and hence,
  that he was engaged in the business of a retail
  liquor dealer. There was also evidence that
  defendant held himself out as ready, willing, and
  able to deliver liquor in quantities exceeding
  five gallons in one sale.
  Through Larson, he was attempting to effect such
  sales, and this was sufficient to show that he
  was carrying on the business not only of a retail
  liquor dealer, but also of a wholesale liquor
  dealer. * * * Sodini v. United States, 6 Cir.,
  261 F. 913; Bailey v. United States, 6 Cir., 259
  F. 88. This is not a case in which there was an
  isolated sale unconnected with circumstances
  showing that defendant was in the business of
  selling." (88 F.2d at page 58, emphasis supplied)

In Bailey v. U.S. supra, [259 F. 89] the Court stated that the phrase "carry on the business of a retail liquor dealer" would not seem to be difficult of definition, either from the standpoint of the words used or from that of the purpose of the law. It was said:

    "There must not only be a `business,' but it
  must be `carried on'. The purpose of the law was
  to raise revenue by an occupation tax. Both of
  these considerations imply that there must be
  something more than a single casual sale,
  disconnected from any habitual or intended
  practice. There cannot be a `business carried
  on,' unless there is either an actual or intended
  adherence to that course of conduct which alone
  can constitute the adoption and practice of a
  business or occupation. Of course, it need not be
  the sole business or occupation, or even one of
  any comparative importance as relating to the
  other business or occupation of the same person;
  nor would it be necessary that any particular
  quantity of material should The kept on hand for
  sale for any particular length of time; but both
  the ability and willingness to make sales from
  time to time, whenever appropriate conditions
  might arise, seem to us to be required, by the
  plain meaning of the words, in order to make out
  an offense against the statute." 259 F. at page
  89.

Further on in the same opinion it was said:

    "We are convinced that the true rule of
  construction is that * * * a single sale is to be
  interpreted in the light of all the
  circumstances, and it may vary from being little
  or no evidence up to the point of being
  convincing evidence that the seller is carrying
  on the business; and that, in order to convict,
  the jury should be satisfied that the defendant
  either had liquor on hand, or was ready and able
  to procure it, in either case with the purpose of
  selling some or all of it to such persons as he
  might from time to time find or conclude or
  accept as customers." Id., 259 F. at page 92.

In Sodini v. U.S. supra, it was said that where the defendant owned a considerable quantity of whiskey, located at the place of the alleged sale, and held this whiskey for the purpose of selling it to such persons as he might select as customers, and actually participated in the sale which brought about his arrest, it was sufficient to convict him as, "In these circumstances, the rules of ...


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