Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

United States v. Sams

January 13, 1965

UNITED STATES OF AMERICA
v.
WILLIAM SAMS, APPELLANT. UNITED STATES OF AMERICA V. MICHAEL GIORANO, A/K/A NICK JEROME, APPELLANT. UNITED STATES OF AMERICA V. FRANK PHILLIPS, APPELLANT. UNITED STATES OF AMERICA V. THOMAS CIANCUTTI, APPELLANT.



Author: Smith

Before BIGGS, Chief Judge, and HASTIE and SMITH, Circuit Judges.

Opinion of the Court

The appellants Ciancutti, Sams and Phillips were tried and found guilty on each of several counts of an indictment charging violations of the Gambling Tax Act of 1954 as amended and the relevant sections of the Internal Revenue Code. Ciancutti and Sams were convicted of the failure, in each of two separate periods covered by different counts of the indictment, to pay the occupational tax imposed by § 4411 of Title 26 U.S.C., in violation of § 7262 of the same title, and the willful failure, in each of the same periods, to pay the same occupational taxes in violation of § 7203 of the same title. Sams and Phillips were convicted of the willful attempt to defeat and evade a large part of the excise tax imposed by § 4401 of Title 26 U.S.C., in violation of § 7201 of the same title. Phillips was convicted also of knowingly making and filing, on March 2, 1961, and June 30, 1961, an application and return which he did not believe to be true and correct, in violation of § 7206(1) of Title 26 U.S.C. All three were convicted of conspiracy to defraud the United States by impeding and obstructing the ascertainment, computation, assessment and collection of the taxes imposed by the cited sections, in violation of § 371 of Title 18 U.S.C. The appellant Giorano was convicted on only one count charging the willful failure to pay the occupational tax. The present appeals are from the judgments entered on the verdicts.

The judgments are challenged as erroneous mainly on the ground that the evidence as to each appellant was insufficient to sustain his conviction on the respective counts of the indictment. In our consideration of the questions raised by this challenge we are required to review the evidence, together with all inferences reasonably and logically deductible therefrom, in the light most favorable to the government. United States v. Minker, 312 F.2d 632, 635 (3rd Cir. 1962), cert. den. 372 U.S. 953, 9 L. Ed. 2d 978, 83 S. Ct. 952 ; United States v. Malfi, 264 F.2d 147, 148 (3rd Cir. 1959), cert. den. 361 U.S. 817, 4 L. Ed. 2d 63, 80 S. Ct. 57 ; United States v. Giuliano, 263 F.2d 582, 584 (3rd Cir. 1959). We consider first the evidence as it relates to Ciancutti, Sams and Phillips.

During the period here in question, between the latter part of June 1960 and August 24, 1961, a gambling casino was in full operation in the Garibaldi Building, located at 1195 Fifth Avenue, New Kensington, Pennsylvania. The enterprise occupied the entire second floor of the premises, which was furnished and equipped as both a horse and gaming room. These facts are not disputed.

Ciancutti argues that the evidence as to him was insufficient to establish that his connection with the wagering operations was such as to make him liable under the statute for either the occupational or excise taxes. Phillips concedes his participation in the operation of the horse room but argues that the evidence was insufficient to establish that he either filed false applications and returns or willfully attempted to defeat and evade the excise taxes. Sams argues that the evidence was insufficient to sustain his conviction under § 7262, supra, failure to pay the occupational tax, or § 7203, supra, willfull failure to pay the same tax. All three argue that the evidence was insufficient to support the charge of conspiracy. We consider the evidence as it relates to each of the appellants and with particular reference to the arguments advanced on their respective behalfs.

The entire second floor of the Garibaldi Building was admittedly under lease to Ciancutti, who entered into possession early in June of 1960. The leased area was a large open room which had been formerly used at various times as a warehouse or dance hall. When Ciancutti took possession he engaged the services of a carpenter who made such alterations as were necessary to convert the premises into a gambling casino and to conceal its operations. These alterations were extensive and included, among other things, the following: the insertion of fiber-board panels in the window frames; the fitting of the entrance staircase with an electrically controlled door at the lower level and a steel door at the upper level; and, the erection of partitions enclosing two office areas. The doors were so arranged that a prospective customer could gain admission to the gambling casino only after he had been identified and admitted by a door man stationed inside. Ciancutti also made the arrangements for the installation of utilities, for which he paid the monthly service charges. During the period that the gambling casino was in operation Ciancutti was in attendance almost daily.

Between a date early in April and August 24, 1961, the Garibaldi Building was under surveillance by special agents of the Internal Revenue Service, one of whom first gained access to the gambling casino on April 23. Thereafter he visited the casino two or three times a week, and on each visit remained on the premises during the usual business hours, placing wagers and observing the operations. At various times the said agent was accompanied by either one or two other special agents, who likewise placed wagers and observed the operations. The results of their observations are fully described in their testimony and can be briefly summarized.

The wagering operations were conducted daily during the afternoon hours and there were usually in attendance 80 or more customers. There were made available for use by these customers printed betting slips, daily racing forms and other materials usually found in a horse room. After the races had been run the results were posted on a large blackboard which extended along the south side of the main room.

The center of the wagering operations was an office, designated in the testimony as the "southern enclosure" in which a special tax stamp issued to Phillips and another issued to one Mangini were conspicuously displayed. The main area of the casino was manned by eleven or twelve employees, designated as "floor men," who received the wagers on behalf of their principals and then turned them in at the office.

Sams was in attendance at the casino almost daily during the afternoon hours and when there assumed charge of the office. He received wagers turned in by the floor men, checked betting slips, handled the tally sheets and supervised the distribution of winnings. When Sams was not present these duties were performed by either Phillips or one Carlucci. The wagers received by the floor men were delivered by them at the office to Sams, Phillips or Carlucci. On occasions both Sams and Phillips would physically receive wagers directly from the bettors; in fact, on numerous occasions the special agents placed their wagers with either Sams or Phillips.

Ciancutti concedes that he did not pay the special tax imposed by § 4411, supra, but maintains that he was under no obligation to do so. He took the witness stand and admitted that he had leased the entire second floor of the Garibaldi Building and had converted it into a gambling casino. However, he testified that he had sublet the area in which the wagering operations were conducted and that his sole proprietary interest was in the gaming activities. Absent this testimony, to which the jury apparently gave no credence, there was ample evidence from which the jury could have found that Ciancutti was one of three enterpreneurs in a profitable gambling business, which included the horse room operations.

This appellant also contends, but in the alternative, that the evidence was insufficient to sustain his convictions under either § 7203 or § 7262, supra. A similar contention is advanced on behalf of Sams. They argue that there is no evidence in the record that they had knowledge of their obligation to pay the occupational tax imposed by § 4411, supra, and therefore should not have been found guilty of either a failure or willful failure to pay it. This argument is without merit. Ingram v. United States, 360 U.S. 672, 3 L. Ed. 2d 1503, 79 S. Ct. 1314 (1959); United States v. Minker, supra; United States v. Marquez, 332 F.2d 162 (2nd Cir. 1964); United States v. Shaffer, 291 F.2d 689 (7th Cir. 1961), cert. den. 368 U.S. 915, 7 L. Ed. 2d 130, 82 S. Ct. 192 . While there is no direct evidence that they knew of the occupational taxes there was ample circumstantial evidence from which the jury could have inferred that they had knowledge of the taxes and willfully failed to pay them. Ibid.

Phillips challenges the sufficiency of the evidence to sustain his convictions under § 7206(1), supra, which makes it an offense for any person to willfully make and subscribe a return or state ment "which he does not believe to be true and correct as to every material matter." The challenge rests on utterly trivial grounds which ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.