IN THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF
UNITED STATES OF AMERICA :
-vs- : CRIMINAL NO. 80-00080-1
JACK HALPERIN :
BRIEF IN SUPPORT OF DEFENDANT'S MOTION TO DISMISS THE
A Grand Jury sitting in the Middle District of Pennsylvania returned an
Indictment against the Defendant, Jack Halperin, in this matter on July 25,
1980. That Indictment charged the Defendant, inter alia, with thirty-three
(33) Counts of Fraud in interstate land sales and Mail Fraud, The Defendant
is filing this Motion at the Arraignment because of the failure of the
Indictment to state the necessary elements of a crime and the failure of the
Indictment to be brought within the Statute of Limitations. With the per-
mission of the Court, the Defendant reserves his right to file additional
Motions after preliminary discovery.
Failure to Allege all of the Elements of a Crime.
The Defendant is specifically charged with a violation of 15 USC 1703,
which reads in pertinent part:
"It shall be unlawful for any developer or agent, directly
or indirectly, to make use of any means or instrument of trans-
portation or communication in interstate commerce, or
of the mails . . . .
(2) in selling or leasing or offering to sell or lease, any
lot in a subdivision.
A. To employ any device, scheme, or artifice
to defraud; or,
B. To obtain money or property by means of
a material misrepresentation with respect to any
information included in the statement of record or
the property report or with respect to any other
information pertinent to the lot or the subdivision
and upon which the purchaser relies; or,
C. To engage in any transaction, practice or
course of business which operates or would operate
as a fraud or deceit upon a purchaser."
It is clear from the Statute that the elements of an offense are: (1)
capacity as defined by the Act; (2) intent to defraud; (3) a scheme to defraud;
and (4) reliance by someone on the fraudulent scheme. Gilbert v. Woods
Marketing, Inc., 454 F. Supp. 745 (D.C. Minn. 1978), Bryan v. Amrep
Corp., 429 F. Supp. 313 (D.C.N.Y. 1977). Capacity entails a subdivision
as defined by the Act, and a developer or agent as defined by the Act. See
15 USC 1701.
The Indictment in this case fails to allege an essential element of a
violation of 15 USC 1703, to wit: That Jack Halperin was either a developer
or an agent(1) as defined in USC 1703. The Third Circuit Court of Appeals in
Bartholomew v. Northampton National Bank of Easton, 584 F. 2d 1288 (3rd
Cir. 1978), recognized this essential element and stated:
"The Act clearly limits the imposition of liability to
those who meet the definitions of developers or agents of
developers." (Emphasis added). Page 1293.
The Government, however, has failed to allege that Mr. Halperin was
an agent or developer as defined by the Act. This omission from the
Indictment of a material element of the crime charged is a fatal flaw, and
thus, the Court is mandated to dismiss Counts I through XIII. See United
States v. King, 587 F. 2d 956, 963-65 (9th Cir. 1978).
The Fifth Amendment requires that a person prosecuted for a crime be
tried only on a presentment or Indictment returned by a Grand Jury that is
sufficiently specific and alleges all the elements of a crime. See Sanabua v.
United States, 437 U.S. 54, 65-66 (1978); Russell v. United States, 369 US.
749, 770-71 (1962). This Indictment clearly does not meet the requirements
demanded by the Supreme Court. It fails to state an essential element of the
crime. Nowhere in the Indictment is it alleged that Mr. Halperin was a
developer or agent as defined in the Act.
In an analogous situation, a violation of 18 USC 1005 requires the person
charged to be in a certain class. Failure to so charge mandates that the
Indictment be stricken. Edruck v. United States, 432 F. 2d 35 (4 Cird. 190).
Title 18 is full of Statutes which apply to only certain classes of individuals.
This class limitation must be alleged in the Indictment or the Indictment
fails. Russell v. United States, supra.
For all of the above reasons, the Defendant moves to dismiss Counts I
Statute of Limitations.
All of the alleged violations of Title 15 USC 1703 occurred over four (4)
years ago, the latest violation alleged was July 14, 1976. The Statute of
Limitations for a violation of 15 USC 1703 is found in 15 USC 1711, which
states that the Limitation is three (3) years. The failure of the Government
to bring the Indictment within the statutory period mandates dismissal.
18 USC 3282 reads in pertinent parts:
"Except as otherwise expressly provided by law, no
person shall be prosecuted, tried, or punished for any
offense, not capital, unless the Indictment is found or the
information is instituted within five (5) years next after
such offense shall have been committed. (Emphasis
15 USC 1711 reads in pertinent parts:
"(a) No action shall be maintained under Section 1709
of this Title with respect to . . . .
(2) a violation of Subsection (A) (2) (A), (A) (2) (B),
or (A) (2) (C) of Section 1703 of this Title, more than three
(3) years after discovery of the violation or after discovery
shall have been made by the exercise of reasonable diligence
. . . ."
18 USC 1382 clearly states that its applicability is limited, and that other
Titles override its scope. U. S. v. Tiplitz, 105 F. Supp. 512 (D.C.N.J.,
1952). While there are no cases interpreting the interplay between 18 USC
1382 and 15 USC 1711, a review of the Legislative history of Title 15 USC 1711
demonstrates that 15 USC 1711 is the appropriate Statute of Limitation.
The original Title 15 USC 1711 used language such as "To enforce any
liability" .... "action be broughtby a purchaser." This language could
suggest that the Statute only covered civil actions. See U. S. v. Bloom,,
78 F.R.D. 591. However, Congress, when it reviewed the scope of 15 USC
1711, clearly decided to-indicate that the scope of 15 USC 1711 covered
"This bill amends the statute of limitations affecting all
violations related to the property report or statement of
record to three (3) years." (Emphasis added). 1979 U. S.
Cong. & Administrative News, 2354.
Congressional purpose was clearly demonstrated in the revision of 15
USC 1711. The language is positive, intelligible, and applicable to the
instant case. Protection from prosecution under a statute of limitations is
a substantive right. U.S. v. Haramic, 125 F. Supp. 128 (D.C. Pa., 1954).
Such limitations are to be liberally interpreted in favor of repose. U.S. v.
Richardson, 393 F. Supp. 83 (D.C. Pa. 1974) affirmed 513 F. 2d 105 (3rd
Cir. 1974). Where lapse of time between commission of offenses charged
and return of Indictment was not within the statute of limitation, the Indict-
ment must be dismissed. U.S. v. Angalone, 197 F. 2d 714 (3rd Cir. 1952).
In the instant case, all the acts alleged in the Indictment occurred more
than three (3) years ago and are postively barred by the Statute of Limitations.
For all of the above reasons, the Defendant moves this Court to dismiss
Counts I through XIII.
PAUL R. MAZZONI, ESQUIRE
SAL COGNETTI, ESQUIRE
ATTORNEYS FOR DEFENDANT,
CERTIFICATE OF SERVICE
The undersigned certify that a verified copy of the attached Brief In
Support Of Defendant's Motion To Dismiss The Indictment was served upon
the United States Attorney for the Middle District of Pennsylvania by hand
delivery at his office in the Federal Building, Scranton, Pennsylvania, on
August 4, 1980.
PAUL R. MAZZONI, ESQUIRE
SAL COGNETTI, ESQUIRE
ATTORNEYS FOR DEFENDANT,
FOOTNOTES 1. The Government in one of its preambles to the charges refers to Mr. Halperin as "agent officer employee". No one can seriously contend that this is sufficient.