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United States v. Baren

July 10, 1962

UNITED STATES OF AMERICA, APPELLEE,
v.
MORRIS BAREN, SAMUEL C. STEIN, STRICK-MATADOR CORPORATION AND STRICK-MATADOR CORP. OF OHIO, APPELLANTS.



Author: Moore

Before SWAN, MOORE and SMITH, Circuit Judges.

LEONARD P. MOORE, Circuit Judge.

Appellants Morris Baren, Samuel C. Stein, Strick-Matador Corporation (S-M) and Strick-Matador Corp. of Ohio (S-M, Ohio) appeal from judgments of conviction of mail fraud and conspiracy (18 U.S.C.A. ยงยง 1341, 1342, 371). The individual defendants received concurrent sentences of eighteen months' imprisonment on each of nine mail fraud counts and one conspiracy count. S-M was fined on each of the ten counts and S-M, Ohio on two counts. Defendant Max Jedicki pleaded guilty and received a suspended sentence. The trial court directed judgments of acquittal as to defendants John Baren and Irving Fluxgold. Defendant Marjay Sales Corp. did not appeal its conviction.

The Indictment

Count I alleges in substance that from on or about November 10, 1956 to January 3, 1958 defendants in the offer and sale of Strick-Matador knitting machines to nine named and various other persons "unlawfully devised, intended to devise, and employed devices, schemes and artifices to defraud and obtain money and property by means of false and fraudulent pretenses, representations and promises." Counts II through X repeat the allegations of Count I but name, respectively, each of the nine purchasers as the recipient of a postcard alleged to have been mailed as part of the fraudulent scheme. Count XI alleges an unlawful conspiracy.

The representations made in furtherance of the scheme and "well known to be false by the said defendants" were:

"(a) That Marjay Sales Corp., Marjay Corp. and Strick-Matador Corporation were wholesale distributors of hand-knit garments which they sold to department stores and specialty shops everywhere.

"(b) That Marjay Sales Corp., Marjay Corp. and Strick-Matador Corporation had a profitable market for hand-knit garments.

"(c) That up to $15.00 to $25.00 per week could be earned by the average lady working five to ten hours per week at home, making and selling knitted garments to the defendants, made on Strick-Matador knitting machines sold to them by the defendants.

"(d) That the cost of the Strick-Matador knitting machines could be paid by the purchasers through putting aside a part of the profit they derived each week from the sale of knitted garments to the defendants.

"(e) That the defendants would purchase for a period of three years, all garments knitted on the Strick-Matador knitting machine purchased from them, made and blocked to the pattern and specifications determined and furnished by the defendants.

"(f) That 99 out of 100 ladies learn the operation of the Strick-Matador knitting machine in only one lesson at the defendants' school.

"(g) That the Marjay Sales Corp., Marjay Corp. and Strick-Matador Corporation buy hand-knitted garments made on Strick-Matador knitting machines from hundreds of ladies.

"(h) That knitting on the Strick-Matador knitting machine is fifty times faster than knitting by hand.

"(i) That a hand-knitted suit that sells for from $150.00 to $350.00 can be knitted on the Strick-Matador knitting machine in from ten to twelve hours by the average woman.

"(j) That the Strick-Matador knitting machine can be operated by a child, and that a person could learn to operate a Strick-Matador ...


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