APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA (D.C. Crim. No. 79-00032)
Before Seitz, Chief Judge and Aldisert, Adams, Gibbons, Rosenn, Hunter, Weis, Garth, Higginbotham and Sloviter, Circuit Judges.
The National Stolen Property Act prohibits the transportation in interstate commerce of forged checks. In this appeal, the defendant argues that the prosecution had to prove that the checks were altered before they were taken over a state line. We conclude that if an unauthorized signature is placed on a check at any point during interstate movement, either before or after a state border is crossed, the statute has been violated. We find sufficient evidence to support the convictions on two counts charging such offenses. We do not, however, find adequate evidentiary support for a conviction alleging a violation of the Dyer Act and direct an acquittal on that count.
The defendant was indicted for transporting two forged checks from Youngstown, Ohio, to western Pennsylvania in violation of 18 U.S.C. § 2314 (1976) (counts I & III). In addition, he was charged with transporting a stolen automobile from Pennsylvania to Ohio in violation of 18 U.S.C. § 2312 (1976) (count II). A jury returned guilty verdicts on all three counts, and the court imposed concurrent sentences.
The checks forming the basis of the indictment were drawn on the Dollar Savings & Trust Company of Youngstown, Ohio, and had been stolen from a labor union in that city in early 1977. On discovery of the theft, the account was closed.
In October 1978, the defendant appeared at the Don Allen Chevrolet agency in Pittsburgh, Pennsylvania, and ordered an automobile for $6,706. He said his home was in Warrensville Heights, Ohio, and that he would return the following day with a credit union check in payment. He reappeared as promised and said that the car was to be titled in Ohio, signed forms to that effect, and tendered a check on the Dollar Savings Bank of Youngstown already drawn in the amount of $6,909. The car was delivered to the defendant, and he drove off. The check was one of those stolen from the union, and the signature was forged. The Don Allen Company called the Youngstown bank the following morning and learned that the union account had been closed, so no attempt was made to negotiate the check.
The evidence applicable to count III of the indictment revealed a similar method of operation. In December 1978, the defendant went to Rini Boat Sales in Beaver, Pennsylvania, and inquired about purchasing a boat. He telephoned a week later and told the dealer that he was going to buy a boat and trailer, but had to get a check from his credit union. He telephoned again on the evening of the same day and asked the proprietor to wait, stating that he was at rest stop on the Ohio Turnpike.
The defendant arrived at Rini Boat Sales in a pickup truck bearing Ohio plates that he said was owned by a friend. He delivered a check already imprinted by a check writing machine. The defendant was given a certificate stating that the trailer was to be registered in Ohio and drove away with the boat and trailer. This check also had been stolen from the union and the signature forged. The proprietor telephoned the Youngstown bank the following morning and, learning that the account had been closed, made no attempt to cash the check.
Count II of the indictment charged that the defendant transported the car he had stolen from Don Allen to Ohio. There was no direct evidence to show where the car was driven after it left the dealer's premises in Pittsburgh.
Common to all three counts was the testimony of an FBI agent that the defendant admitted living in East Liverpool, Ohio, during the time the checks were delivered to the auto and boat dealers.
I. THE FORGED CHECK COUNTS
The defense concedes that the only issue before us is whether the interstate commerce requirement for federal criminal jurisdiction has been satisfied. This issue is purely one of statutory interpretation, no contention having been made that a commerce clause nexus would fail to satisfy constitutional prerequisites for federal jurisdiction.
In pertinent part, 18 U.S.C. § 2314 states, "Whoever, with unlawful or fraudulent intent, transports in interstate or foreign commerce any ... forged ... securities ..., knowing the same to have been ... forged ... (s)hall be fined ... or imprisoned ... or both."*fn1 Section 10 of the same title provides, in part, "The term "interstate commerce', as used in this title, includes commerce between one State ... and another State...."
The defendant contends that to convict, the prosecution had to show that the check was forged before it crossed a state line. The government argues that if the check was taken from Ohio to Pennsylvania, even if the actual forgery occurred in the latter state, the violation was complete because the interstate character of the transportation persisted.
The trial court accepted the government's position and charged that "transportation within the destination state here, Pennsylvania, may be considered transportation in interstate commerce if it is a continuation of the movement that began out of state."
There is surprisingly little variety to the case law applying § 2314 to forged check transactions. Most opinions hold that the interstate commerce requirement is satisfied if, after the defendant negotiates a forged check, it travels interstate in the bank collection process. See, e. g., Pereira v. United States, 347 U.S. 1, 74 S. Ct. 358, 98 L. Ed. 435 (1954); United States v. Newson, 531 F.2d 979 (10th Cir. 1976). "There is no requirement of actual physical transportation by a defendant and it is sufficient that a defendant cause the instrument to be transported by the negotiation process." Id. at 981; 18 U.S.C. § 2(b) (1976). To the same effect, see United States v. Sciortino, 601 F.2d 680, 683 (2d Cir. 1979); United States v. Ackerman, 393 F.2d 121, 122 (7th Cir. 1968). As the Court of Appeals for the Tenth Circuit pointed out in Newson, "The essence of the offense is the fraudulent scheme itself and the interstate element is only included to provide a constitutional basis for the exercise of federal jurisdiction." 531 F.2d at 98.
An alternative method of proof emerged from another line of cases beginning with Castle v. United States, 287 F.2d 657 (5th Cir. 1961). There, the government proved that the defendant forged money orders in Pennsylvania and later cashed them in Texas. No question was raised about the applicability of § 2314 in that factual setting, and there is no doubt that the interstate commerce aspect was satisfied.
By the curious metamorphosis sometimes seen in decisional law, some courts have built Castle into a doctrine requiring that if the check was not collected through the interstate banking system, the prosecution must prove that the securities were forged before being transported over a state line. A coincidence of fact in Castle thus became a jurisdictional element of prosecution. For example, in United States v. Owens, 460 F.2d 467 (5th Cir. 1972), the court held, without analysis of the jurisdictional phase of the statute, that if the forgery of money orders occurred in Louisiana where there was an attempt to cash them, no offense under § 2314 had occurred even though the money orders had been stolen in New Jersey.
We note an important factual distinction between Owens and this case. In the former there was no evidence to show that the defendant, a seventeen year-old, had transported the money orders, in altered or unaltered form, from New Jersey to Louisiana. Here, by contrast, there is testimony to support findings of interstate journeys by the defendant from Ohio to Pennsylvania for the purpose of engaging in a commercial transaction, during which he had the checks in his possession. See p. 279 infra.
Nevertheless, the Owens opinion makes clear that the court believed the government was required to prove that the money orders had been forged in New Jersey, "prior to their interstate transportation." Id. at 471. And other courts of appeals reading Owens this broadly have followed it without any examination of its validity. See United States v. Sparrow, 635 F.2d 794 (10th Cir., 1980) (in banc); United States v. Hilyer, 543 F.2d 41 (8th Cir. 1976). See also United States v. Lee, 485 F.2d 41 (4th Cir. 1973). It is this line of cases that the defendant urges upon us here.
We begin by examining the history and language of § 2314. It derives from § 3 of the National Stolen Property Act. Ch. 333, 48 Stat. 794 (1934). In United States v. Sheridan, 329 U.S. 379, 67 S. Ct. 332, 91 L. Ed. 359 (1946), the Court emphasized that the Act established a scheme of federal-state cooperation designed to apprehend and punish criminals "whose offenses are complete under state law, but who utilize the channels of interstate commerce to make a successful getaway and thus make the state's detecting and punitive processes impotent." Id. at 384, 67 S. Ct. at 335. The Court also said that the transportation of forged checks is not to be torn from its setting and given a status distinct from other forbidden transportations. "The legislative history shows that the purpose ((of the Act)) was to bring operators in these false securities into substantially the same reach of federal power as applied to others dealing in stolen goods, securities and money." Id. at 389, 67 S. Ct. at 337. We may, therefore, look to decisions under other sections of the Act as an aid in construing the meaning of transportation in interstate commerce.
The language of § 2314 does not state that the checks must be forged before interstate transportation begins. Transportation in interstate ...