text:
    Charles F. WILLIS, Jr., Plaintiff-Appellant, v. Dr. Irving R. RUTKIN et al., Defendants-Appellees.
    No. 73-1501
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    June 11, 1973.
    G. Kenneth Kemper, Miami Shores, Fla., Cleveland D. Miller, Robert E. Scott, Jr., Baltimore, Md., for plaintiff-appellant.
    Murray Sams, Jr., Miami, Fla., for Rutkin, Yates and Bell.
    Roger A. Bridges, Francis W. Sams, Alan R. Schwartz, Miami, Fla., for Aircraft, Greyhound and Continental.
    Before GEWIN, COLEMAN and MORGAN, Circuit Judges.

       Rule 18, 5th Cir. See Isbell Enterprises, Inc. v. Citizens Casualty Co. of New York et al., 5th Cir. 1970, 431 F.2d 409, Part I.

   PER CURIAM:

This case arose out of a stock transaction in which the owners of Aircraft Services International, Inc. (ASI) sold the company to the Greyhound Corporation. Appellant Willis, one of ASI’s owners, brought this suit to enforce an alleged agreement he claims to have made with the company’s other owners prior to the sale. At trial Willis contended and presented evidence to the effect that he agreed to a reduction of ten percent in the amount of stock he held only upon condition that the value of the interest given up would be repaid to him by the other owners after the sale was consummated and the full amount of the proceeds from Greyhound received. After hearing all of the evidence the trial court concluded that under the agreement in question Willis accepted a reduction in his equity in ASI and that there was no agreement to repay him after the sale. It was found that Willis agreed to the reduction in order to provide an incentive to the other owners, who were to continue as operators of the company after the proposed sale, to exert their best efforts to maximize the proceeds from the sale which depended in large part on an increase in the company’s earnings in the years immediately following the transfer of ownership. The trial court further found that this agreement was carried out and that under it the maximum payout possible from the sale to Greyhound was achieved. Having painstakingly reviewed the record and the contentions of the parties, we conclude that the findings of the trial court are not clearly erroneous and that appropriate legal conclusions were reached. Accordingly its judgment is affirmed.

Affirmed.


source: Caselaw Access Project

author: PER CURIAM:

license: Public Domain

text:
    James Herbert WEATHERS, Petitioner-Appellant, v. J. D. HENDERSON, Warden, U. S. Penitentiary, Respondent-Appellee.
    No. 72-3780
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    May 31, 1973.
    James Herbert Weathers, pro se.
    John W. Stokes, Jr., U. S. Atty., Anthony Arnold, Asst. U. S. Atty., Atlanta, Ga., for respondent-appellee.
    Before THORNBERRY, GOLDBERG and RONEY, Circuit Judges.

       Rule 18, 5 Cir.; see Isbell Enterprises, Inc. v. Citizens Casualty Company of New York, et al., 5 Cir. 1970, 431 F.2d 409, Part I.

   PER CURIAM:

In his petition for writ of habeas corpus, petitioner seeks to have removed a detainer lodged against him by the State of Pennsylvania in connection with a State sentence. He contends that the State relinquished jurisdiction over him when it released him to federal custody.

Although it appears that petitioner could more properly attack the Pennsylvania detainer in that State and, therefore, the District Court perhaps should not have considered the habeas petition, the District Court correctly concluded that petitioner is not entitled to the relief he seeks. As this court recently reiterated in DeLong v. United States, 474 F.2d 719 (5th Cir. 1973),

“It is settled that where one sovereign surrenders a prisoner to another sovereign for trial, sentencing, and execution of the sentence before he is to be returned to the custody of the sovereign first having jurisdiction, the prisoner has no standing to attack the agreement between sovereigns and the surrendering sovereign has not thereby-waived its right to have the prisoner returned to its custody for trial.”

See also Chunn v. Clark, 451 F.2d 1005 (5th Cir. 1971); Dorrough v. Texas, 440 F.2d 1063 (5th Cir. 1971); Scott v. United States, 434 F.2d 11 (5th Cir. 1970)

Affirmed.

      . The case of Shields v. Beto, 370 F.2d 1003 (5th Cir. 1967), cited by the appellant is inapposite to the facts of this case. In Shields, the State of Texas showed no interest in obtaining custody of the appellant to complete his sentence for some twenty-eight years, either by filing a detainer against him while he was serving other sentences, or by arresting him while he remained out of custody for sixteen years. See Hanks v. Wideman, 434 F.2d 256 (5th Cir. 1970).


text:
    NATIONAL LABOR RELATIONS BOARD, Petitioner, v. LOCAL UNION NO. 415 (INDUSTRIAL) UNITED BROTHERHOOD OF CARPENTERS AND JOINERS OF AMERICA, AFL-CIO, et al., Respondents.
    No. 73-1203.
    United States Court of Appeals, Sixth Circuit.
    June 5, 1973.
    Marcel Mallet-Prevost, Asst. Gen. Counsel, N.L.R.B., Washington, D. C., John C. Getreu, Director, Region 9, N.L.R.B., Cincinnati, Ohio, for petitioner.
    Jerry F. Venn, Cincinnati, Ohio, for respondent.
    Before CELEBREZZE, PECK and LIVELY, Circuit Judges.
   ORDER

This cause came on to be considered on Petitioner’s application for the summary entry of judgment enforcing its Order of September 25, 1972, against Respondents, adopting the findings, conclusions and recommendations of the Administrative Law Judge’s Decision and ordering appropriate relief thereunder. Respondents have filed no response to this application.

Upon review of the record filed with this Court by Petitioner it appears that Respondents failed to file timely objections to the Administrative Law Judge’s Decision, as required under Section 10 (c) of the Act and under Sections 102.46 and 102.48 of the Rules and Regulations of the National Labor Relations Board, Series 8. Respondents have failed to show this Court any extraordinary circumstances which might excuse this failure, and they are therefore precluded under Section 10(c) of the Act from raising any objections to Petitioner’s Order before this Court.

It is therefore ordered that said application for summary entry of judgment enforcing Petitioner’s Order be and the same is hereby granted and that said Order be and the same is hereby enforced.


text:
    Elvy RHYNES, aka Jack Rhynes, Petitioner-Appellant, v. Louie L. WAINWRIGHT, Director, Division of Corrections, State of Florida, Respondent-Appellee.
    No. 73-1196
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    June 11, 1973.
    Elvy Rhynes, pro se.
    Robert L. Shevin, Atty. Gen., Michael M. Corin, Asst. Atty. Gen., Tallahassee, Fla., for respondent-appellee.
    Before BELL, GODBOLD and IN-GRAHAM, Circuit Judges.

       Rule 18, 5 Cir., Isbell Enterprises, Inc. v. Citizens Casualty Company of New York et al., 5 Cir., 1970, 431 F.2d 409, Part I.

   PER CURIAM:

The only issue left in this case is whether appellant was sentenced in Florida state court without presence of counsel. The federal District Court denied relief based on the finding of the Florida state court entered in a Rule 1.850, 33 F.S.A., proceeding that appellant was represented by counsel when sentenced. That order was entered by a judge other than the sentencing judge and without an evidentiary hearing. The minutes of the sentencing which are before us do not show, nor are we able to find anything else in the record which shows, the presence of counsel. See Gutierrez v. Estelle, 474 F.2d 899 (CA5, 1973). The State of Florida, while not conceding that either the Rule 1.850 order of the state court, or the federal District Court order relying thereon, is erroneous, eommendably suggests that the interests of justice can be fulfilled only by an evidentiary hearing. We agree.

Vacated and remanded.


text:
    Fano SAGONA, Plaintiff-Appellant, v. PLUMBERS AND STEAMFITTERS LOCAL NO. 60, et al., Defendants-Appellees.
    No. 73-1014
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    May 31, 1973.
    Richard A. Tonry, T. M. McBride, III, Chalmette, La., for plaintiff-appellant.
    Robert K. McCalla, New Orleans, La., for Tompkins.
    Jerry L. Gardner, Jr., New Orleans, La., for Plumbers.
    Before JOHN R. BROWN, Chief Judge, and DYER and SIMPSON, Circuit Judges.

       Rule 18, 5 Cir., Isbell Enterprises Inc. v. Citizens Casualty Company of New York et al., 5 Cir., 1970, 431 F.2d 409.

   PER CURIAM:

Appellant sued Local 60 and a monetary employer (Tompkins-Beckwith, Inc.) under § 301, 29 U.S.C.A. § 185 for conspiracy and a discriminatory refusal to refer him to jobs. Included was also the complaint that Local 60 had failed properly to present and prosecute his grievance as to this treatment. The district court on affidavits and depositions which did not controvert the essential facts on which we act, entered an order which essentially dismissed as on summary judgment.

Local 60 maintained two divisions (i) building trades and (ii) metal trades. The worker qualifications, dues, etc., of each division were quite different. Appellant was a member of the metal trades division. Probably through error of an inexperienced night shift hiring hall employee, the appellant was referred to the utility construction project of the employer whose contract with Local 60 was through an association of building construction contractors. When it was shortly discovered that appellant (and another) were metal trades members, Local 60 recalled him from the job.

On facts which appellant never contradicted, there was no breach of the collective bargaining contract and no basis for a grievance. This disposition as on summary judgment was an ideal instrument for terminating this baseless lawsuit in its tracks.

Affirmed.

      . Plumbers and Steamfitters Local No. 60.


text:
    UNITED STATES of America, Appellee, v. Robin Ennette MASON, Appellant.
    No. 73-1104.
    United States Court of Appeals, Ninth Circuit.
    May 16, 1973.
    Lewis A. Wenzell (argued) of Federal Defenders of San Diego, Inc., San Diego, Cal., for appellant.
    Thomas M. Coffin, Asst. U. S. Atty. (argued), Harry D. Steward, U. S. Atty., Stephen G. Nelson, Asst. U. S. Atty., San Diego, Cal., for appellee.
    Before ELY and CARTER, Circuit Judges, and KING, District Judge.

       Honorable Samuel P. King, United States District Judge, Hawaii, sitting by designation.

   PER CURIAM:

The appellant, a woman, was convicted of the offense of having imported approximately one ounce of heroin from Mexico into the United States. 21 U.S. C. §§ 841(a)(1), 952, 960, 963. As she entered this country, certain facts excited the suspicion of the border police. This led to her disrobing and a casual examination of her nude body by a border policewoman. During this examination, the appellant was observed to place one of her hands in the vicinity of her crotch, whereupon she was asked if she objected to being examined by a physician. She replied “no”, and in a probe of her vagina by the physician to whom she was taken, the heroin in question was discovered.

The appellant concedes that under the applicable tests of our Circuit, the police were justified in causing the appellant to disrobe, in conducting the visual search of her body, and in causing her bodily cavities to be searched by a physician. She urges, however, that we should adopt the rule that when time permits, no search of a bodily cavity may be made by border police, or at their instigation, without there having been obtained, in advance, a warrant authorizing such a search.

Our court has announced rather strict requirements which must be present before our border police are authorized to invade, or cause to be invaded, the body cavities of a female. See, e. g., Henderson v. United States, 390 F.2d 805 (9th Cir. 1967). It has not, however, adopted the rule for which appellant contends. See, e. g., United States v. Sosa, 469 F. 2d 271 (9th Cir. 1972); United States v. Castle, 409 F.2d 1347 (9th Cir. 1969).

The judgment of conviction must be affirmed.

      . Judge Ely notes, as he has often done before, his belief that searches of the body cavities of any person, male or female, with hands or stomach pumping, should not be tolerated absent the procurement, in advance, of a judicial authorization for such a search. United States v. Holtz, 479 F.2d 89, 94 (9th Cir. 1973) (dissenting opinion) ; Thompson v. United States, 411 F.2d 946 (9th Cir. 1969) (dissenting opinion) ; Huguez v. United States, 406 F.2d 366, 383, 384 (9th Cir. 1968) (concurring opinion) ; Blefare v. United States, 362 F.2d 870, 880-888 (9th Cir. 1966) (dissenting opinion). See Comment, Intrusive Border Searches
      —Is Judicial Control Desirable? 115 U.Pa.L.Rev. 276 (1966) ; Note, 21 Rutgers L.Rev. 513 (1967) ; 18 Case W.Res. L.Rev. 1007 (1967); 19 Fla.L.Rev." 374 (1966). See also Note, Border Searches and the Fourth Amendment, 77 Yale L.J. 1007 (1968).
      Judge King agrees with Judge Ely’s foregoing views. Like Judge Ely, however, he believes that the present law of this Circuit compels the rejection of the appellant’s contention.


text:
    UNITED STATES of America, Plaintiff-Appellee, v. Ernest I. TORRENCE, a/k/a Farley Stevens, Defendant-Appellant.
    No. 72-2271
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    June 14, 1973.
    Rehearing Denied July 25, 1973.
    Donald N. Denson, Ocala, Fla., Howard B. Pearl, Citra, Fla., for defendant-appellant.
    John L. Briggs, U. S. Atty., Robert S. Yerkes, Asst. U. S. Atty., Jacksonville, Fla., for plaintiff-appellee.
    Before BELL, DYER and CLARK, Circuit Judges.

       Rule 18, 5 Cir.; see Isbell Enterprises, Inc. v. Citizens Casualty Company of New York et al., 5 Cir. 1970, 431 F.2d 409, Part I.

   PER CURIAM:

This is an appeal from a judgment of conviction entered on a jury verdict that Torrence twice transported a woman in interstate commerce in furtherance of a scheme to defraud her of a sum of money greater than $5,000, in violation of 18 U.S.C.A. § 2314. He raises three points on appeal: (1) that certain improper and prejudicial hearsay testimony was admitted at the trial; (2) that the distriet court erroneously charged the jury with respect to its use of similar acts by Torrence to infer intent; and (3) that his motion for a judgment of acquittal should have been granted because the particulars charged in the indictment were not proved. We find merit in his second argument, and we reverse and remand for a new trial.

The specific acts for which Torrence was indicted concerned his amorous advances to a Houston widow. As the first major witness for the Government, she testified to the effect that after she had written him via a pen-pal club, he quickly won his way into her confidences, proposed marriage which was accepted, took her from Texas to Florida to view their future homesite, talked her into giving him her $7,000 savings “for investment,” convinced her to sell her house in Texas, obtained $12,000 from the proceeds of that sale “for investment,” helped her move to Florida, and got her settled in a rented house for which he paid some of the rent. She concluded her testimony by stating that the relationship soon terminated and that she had recovered only $2,000 of her money.

Torrence has not seriously contested much of the preceding evidence, but strenuously objects to the court’s instruction allowing the jury to use virtually everything introduced subsequently by the Government. The remainder of the Government’s evidence was introduced in an attempt to establish a similar meretricious relationship between Torrence and two other widows at or about the time of his relationship with the Government’s primary witness. This attempt was singularly unsuccessful.

Both of these women admitted knowing Torrence and acknowledged paying him large sums of money. Additionally, the Ohio widow disclosed that she had taken a trip to Florida with Torrence; the Virginia widow similarly stated that Torrence had helped her move to Florida, had arranged to rent a mobile home for her, and had paid some of the rent on the home. At that point, however, the parallel with the Government’s primary witness ends. Both women testified that they had never been more than mere friends with Torrence and that that friendly relationship continued to the present. The money paid to Torrence was explained as repayments of loans previously made to them by Torrence for which they were grateful. In short, each woman steadfastly maintained that she had not been the victim of any fraud perpetrated by Torrence and that he did not owe her any money.

Based on the record as briefly described above, the district court charged the jury that, if it found from other evidence that Torrence had committed the acts charged in the indictment with respect to the Government’s primary witness, it could infer from other similar acts (if clearly and conclusively established) that Torrence acted willfully and with specific intent.

We are not called upon here to approve or disapprove the wording of that charge; instead Torrence argues that no such charge should have been given because there was no evidence to support it. We agree. Despite the Government’s valiant efforts to establish Torrence as a man who had committed similar acts on at least two other occasions, its two witnesses, obviously offered as the “victims,” consistently denied that any fraudulent scheme had been used against them. With no other evidence to even suggest Torrence’s involvement with prior similar acts, the court’s charge, even though an arguably correct statement of the abstract rule, see United States v. Broadway, 5 Cir. 1973, 477 F.2d 991, abstract rule, impermissibly allowed the jury to infer intent from allegedly similar acts nowhere evidenced in the record. Cf. United States v. Collier, 7 Cir. 1963, 313 F.2d 157; Smith v. United States, 6 Cir. 1956, 230 F.2d 935. This was reversible error and requires a new trial.

Reversed and remanded.

      . The other points raised on appeal are without merit.


author: THORNBERRY, Circuit Judge:

text:
    Emmett M. BRIDGER, Individually, et al., Plaintiffs-Appellants, v. INTERNATIONAL BUSINESS MACHINES CORPORATION, Defendant-Appellee.
    No. 72-2856.
    United States Court of Appeals, Fifth Circuit.
    June 27, 1973.
    Rehearing Denied July 18, 1973.
    Doye E. Green, Buckner F. Melton, Macon, Ga., for plaintiffs-appellants.
    Edward J. Harrell, Cubbedge Snow, Jr., Macon, Ga., for defendant-appellee.
    Before TUTTLE, THORNBERRY and RONEY, Circuit Judges.
   THORNBERRY, Circuit Judge:

Appellant Bridger brought this suit in state court to recover damages for injuries to himself and the death of his wife, caused when the car occupied by appellant and his wife was struck from the rear by a car driven by Billy Farris Teasley, an employee of appellee International Business Machines Corporation (IBM). Alleging diversity of citizenship, IBM removed the case to the court below. Both sides moved for summary judgment; the trial court granted IBM’s motion, holding that the facts established as a matter of law that Teasley was not acting within the scope of his employment with IBM at the time of the accident. Upon a careful review of the record, we have concluded that the issue of scope of employment should have been left to the jury. Accordingly, we reverse the judgment below and remand for trial.

Teasley was a “customer service engineer” or serviceman for IBM, performing repairs and service on IBM products (typewriters, dictation equipment, and the like) on the owners’ premises. He was required to be at the day’s first job by 8:30 a. m. and was permitted to cease work in time to return to IBM’s Macon, Georgia, office by 5:15 p. m., although he was not required actually to return to Macon at the end of the day. For any work done outside these hours, Teasley was paid overtime. Although all customer service engineers were subject to call seven days a week, twenty-four hours a day, to perform emergency service work, Teasley had not received an emergency call for at least two years prior to the date of the accident, and the equipment he was trained to repair was not normally serviced after regular hours. Moreover, it is unclear from the record whether IBM could relay an emergency call to Teasley in the field; Teasley’s supervisor testified only that “now we are actually using radios to contact them” [emphasis added],

Teasley drove his own car when making service calls, and was paid $2.70 per day for maintenance, whether he drove his car or not. In addition, IBM paid him mileage for the distance between his home in Warner Robins, Georgia, to the first job of each day, the distance he drove between job sites during the day, and the distance from the last job site back to Warner Robins, regardless of whether he actually returned to Warner Robins after finishing his last job.

On the day of the accident in question, after spending about two hours at IBM’s Macon office, Teasley performed service work at Robins Air Force Base in Warner Robins for almost two hours. Thereafter he drove to the Agriculture Stabilization and Conservation Service office in Perry, Georgia, and did repair work there for approximately four hours. It is undisputed that this was his last service call for the day and that he received no emergency calls that night. He left Perry at roughly 5:00 p. m. and took the easternmost of four alternate routes to Warner Robins, located roughly twelve miles northeast of Perry. At the town of Bonaire, Georgia, he drove east to the Flamingo Club, where he drank beer until ten o’clock that night. He then resumed his trip toward Warner Robins. Shortly after reaching the highway to Warner Robins, his car struck appellant’s car from the rear, severely injuring Mr. Bridger and killing his wife. Teasley claimed and received mileage for the trip from Perry to Warner Robins.

In Georgia, an employer’s liability for the torts of his employee is governed by statute:

Every person shall be liable for torts committed by his wife, his child, or his servant, by his command or in the prosecution and within the scope of his business, whether the same shall be by negligence or voluntary.

Ga.Code § 105-108. Undeniably, Teasley was performing a purely personal mission while he was at the Flamingo Club for almost five hours drinking beer, and IBM cannot be liable for any tort he committed while engaged in that mission. Greeson v. Bailey, 1929, 167 Ga. 638, 146 S.E. 490. Under Georgia law, however, the employer’s liability for his employee’s torts is suspended only during the employee’s “deviation” from his duties; upon the employee’s resumption of his work, the employer’s liability re-attaches. E. g. Atlanta Furniture Co. v. Walker, 1935, 51 Ga.App. 781,181 S.E. 498. Thus, the issue here is whether the trial court properly held that the evidence conclusively established that Teasley had not resumed the discharge of his duties at the time of the accident.

In Southern Gas Corp. v. Cowan, 1954, 89 Ga.App. 810, 81 S.E.2d 488, the Georgia Court of Appeals held that facts substantially similar to those of the ease at bar authorized a jury finding that an employee-driver was acting within the scope of his employment at the time of an automobile accident. Bowman, a salesman and serviceman for Southern Gas, collided with the plaintiff while driving home in a company-owned car roughly two hours after his last call of the day. The company paid operating expenses for the car, which Bowman could keep at home for his personal use subject to emergency business calls. Relying primarily on the fact that Bowman kept the car for his personal use subject to emergency calls, the court of appeals held that this evidence warranted a jury finding that Bowman was acting within the scope of his employment while driving home in the company car:

To the extent that he was subject to call at all hours and had the automobile there to use in case he was so called, the keeping of the automobile at his home was in furtherance of his employment duties . . . Bowman’s driving of the company’s automobile from the place of his last call to his home where he would keep it subject to using it on company business in the event he was called out by the company was within the scope of his employment.

81 S.E.2d at 490. The court expressly-reserved the question whether Bowman would have been acting within the course of his employment while performing personal errands after reaching his home.

The holding in Cowan is somewhat ambiguous. Bowman was arguably benefiting his employer both by keeping the car subject to use on emergency business and by storing his employer’s car at his home overnight. Whether either of these possible benefits was enough to impose vicarious liability on an employer, or whether both of them were necessary, was unclear until the Cowan court decided Price v. Star Service and Petroleum Corp., 1969,119 Ga.App. 171,166 S.E.2d 593. There, an employee of Star Service had been involved in a collision while driving home from a Sunday church service in a company car. The opinion contains no mention of whether the employee was on call at the time of the accident. It was argued that the employee was benefiting his employer simply by driving the company ear home for storage; but the court squarely rejected that argument, holding that company ownership of the car, standing alone, is an insufficient basis of employer liability. That holding makes it evident that the fact that Bowman was on call was the deciding factor in imposing liability on the employer in Cowan. It follows that, if Teasley was subject to call after resuming his trip home to Warner Robins, he was, no less than was Bowman, acting within the scope of his employment.

The trial court distinguished Cowan, however, on the ground that Teasley was not subject to emergency call. Noting that Teasley had not received an emergency call in at least two years, and pointing to IBM’s doubtful ability to contact Teasley in the event of an emergency, the trial court held that the requirement of availability in emergencies was “never enforced and . . . not expected to be enforced” and was “at best a theoretical requirement.” In our view, the question whether Teasley was on call was properly a question for the jury in the instant case. Merely because no emergency calls had been made is no evidence that IBM would not “enforce” the requirement that servicemen answer such calls if they were made. Nor is it as clear to us as it was to the trial court that IBM had no way of contacting Teasley in the event an emergency call was made. As noted above, Teasley’s supervisor testified on deposition that “now we are actually using radios to contact them” [emphasis added]. While it is reasonable to infer from this statement that at some point in the past IBM did not use radios to contact its servicemen, the statement says nothing about whether IBM had any means of contacting its servicemen before the installation of the radios. - In brief, the question whether Teasley was in fact subject to emergency call — which, as we have seen above, is a critical factor in determining his employer’s liability— was a disputed issue of fact that was inappropriate for the decision by the trial court on motions for summary judgment. Accordingly, the judgment below is reversed and remanded for further proceedings consistent with this opinion.


author: FRIENDLY, Circuit Judge:

text:
    UNITED STATES of America, Plaintiff-Appellee, v. Ronald BURKET, Defendant-Appellant.
    No. 930, Docket 72-2356.
    United States Court of Appeals, Second Circuit.
    Argued May 31, 1973.
    Decided June 22, 1973.

      Thomas P. Flaherty, Buffalo, N. Y., for defendant-appellant.

      Roger P. Williams, Asst. U. S. Atty. (John T. Elfvin, U. S. Atty., W. D. N. Y., of counsel), for plaintiff-appellee.
    Before MOORE, FRIENDLY and FEINBERG, Circuit Judges.
   FRIENDLY, Circuit Judge:

Appellant Ronald Burket, along with Terry Davis, Theodore Bortz and Ferdinand Santana, were charged in a four count indictment in the District Court for the Western District of New York with conspiring to violate 18 U.S.C. § 2113 and with three susbtantive violations of that section as a result of armed robbery of a bank in Buffalo, N. Y., on May 18, 1972. On the government’s motion the trial of Burket and Santana was severed from that of Davis and Bortz. At the close of the government’s case, the court granted a motion for acquittal of Santana. The jury found Burket guilty on the conspiracy count and on two substantive counts but acquitted him on a count charging the taking of money by use of dangerous weapons in violation of 18 U.S.C. § 2113(d).

The testimony of bank employees was this: Four masked men entered the bank on the morning of May 18. Two, who were armed, kept the employees at bay while the others rifled the cash drawers. One of the latter wore a blue denim jacket, blue jeans, brown scuffed boots and a yellow-brown shirt-like head covering; the other wore a blue knit ski cap. One of the armed men, wearing a white pillow case type head covering, was later identified by a teller as Bortz.

At the time of the entry, branch manager Blarr was telephoning his wife. He was ordered by one of the robbers to hang up, but Mrs. Blarr apparently alerted the Buffalo police,' who shortly arrived on the scene. They found four men running away, and gave chase. One man dropped a blue knit ski cap which an officer retrieved, was later caught, and was identified as Terry Davis. Bortz was also apprehended. Pursuit of a third man, appellant Burket, resulted in his capture; he was wearing a blue denim jacket, dungaree pants and brown scuffed boots. A yellow-brown shirt was found on the sidewalk next to a 1970 gold Buick auto parked adjacent to the bank. The car contained boxes and bait money from the bank, as well as two bags carried by the robbers who had worked the tellers’ cages. The fourth man — Santana, on the government’s theory — got away but was apprehended later in the day.

In light of this, and of the finding of a latent fingerprint of Burket on the getaway car, a reader might be excused for wondering what this appeal is all about. The answer is that, due apparently to inexperience, the prosecutor’s conduct of the trial confessedly left much to be desired. The errors fall into three categories: (1) allowing the jury to consider exhibits not properly before them; (2) questioning Mrs. Bortz and Mrs. Davis, wives of the two codefendants whose trial had been severed, see fn. 1; and (3) producing as a witness the marshal who had been in charge of the jury.

(1) The exhibit material improperly submitted to the jury falls into three categories:

(a) The government had introduced in evidence the certificate of registration of a 1966 Buick owned by Davis which was found on the evening of the robbery in front of the premises where Santana lived; latent palm and fingerprints found on the car; and allegedly similar prints of Santana.
(b) Five descriptive tags, which had not been admitted into evidence, attached to pieces of clothing and a clip of bullets that had been received in evidence.
(c) A photograph of Burket which had never been offered in evidence, although photographs of Bortz, Davis and Santana had been.

When this was brought to Judge Henderson’s attention as the result of a request by the jury for a list of exhibits and subsequent discussion by counsel, the judge called for the exhibits and ordered the offending items removed. This took some time, and the jury reached a verdict before the exhibits were returned. With counsel in agreement, the judge then requested the jury to continue its deliberations with the proper exhibits. Fifteen minutes later the jury returned with its verdict.

A sufficient answer to the attempt to secure reversal on this score might be that defense counsel was as responsible as the prosecutor for seeing to it that only proper exhibits were sent to the jury room. See Rumely v. United States, 293 F. 532, 557-558 (2 Cir.), cert. denied, 263 U.S. 713, 44 S.Ct. 38, 68 L.Ed. 520 (1923); United States v. Strassman, 241 F.2d 784, 786 (2 Cir. 1957) (Medina, J.); United States v. Yoppolo, 435 F.2d 625 (6 Cir. 1970); but see Osborne v. United States, 351 F.2d 111, 116 (8 Cir. 1965). Contrast United States v. Adams, 385 F.2d 548 (2 Cir. 1967), where defense counsel objected with vigor, but without success. Still we would not wish to affirm on this ground if we believed that Burket suffered substantial prejudice. But we do not. Judge Henderson had told the jury in the clearest terms that Santana was out of the case. While the jury had expressed its difficulty in distinguishing between the Santana and Burket fingerprint exhibits, it had an opportunity to view the Burket prints in isolation after the judge requested the jury to continue its deliberations. Since nothing was added to the evidence against Burket by the certificate of registration of the 1966 Buick, its presence in the jury room could hardly have had any prejudicial impact. The writing on the tags was simply a description of the objects and a notation where the officers had found them, to all of which the officers had testified; the tags did not represent “a neat condensation of the government’s whole case against the defendant,” United States v. Ware, 247 F.2d 698, 700 (7 Cir. 1957), quoted in United States v. Adams, supra, 385 F.2d at 550. The photograph of Burket was not a mug shot, as defense counsel alleges, nor were the photographs of the three other men. Its sole value to the prosecution was in depicting how Burket looked shortly after the robbery, before he changed his facial appearance. But the identification of Burket rested more on his clothing than on his face, which had been largely concealed by the shirt, and on his having been caught in hot pursuit, and the failure to offer this photograph in evidence, as the other three were, seems to have been a mere inadvertence which the judge could have allowed the prosecution to cure even after it had closed its case. See Neely v. United States, 300 F.2d 67, 75 (9 Cir.), cert. denied, 369 U.S. 864, 82 S.Ct. 1030, 8 L.Ed.2d 84 (1962); 6 Wigmore, Evidence §§ 1877, 1880 (3d ed. 1940). We trust, however, that both prosecutors and defense counsel will take their responsibilities with respect to the transmission of exhibits to the jury more seriously than was done here.

(2) The defense’s first claim with respect to the examination of Mrs. Bortz and Mrs. Davis is that the government called them although knowing that they would refuse to testify on the ground of self-incrimination. Such action has been held to be error, United States v. Maloney, 262 F.2d 535 (2 Cir. 1959), although not necessarily calling for reversal, Namet v. United States, 373 U.S. 179, 83 S.Ct. 1151, 10 L.Ed.2d 278 (1963), either on the theory that the government is guilty of prosecutorial misconduct by seeking to build its case out of an inference from invocation of the privilege or on the view that the defendant is unfairly prejudiced by inability to cross-examine. See Namet v. United States, supra, 373 U.S. at 186-187, 83 S.Ct. 1151, 10 L.Ed.2d 278. The short answer to all this in the instant case is that, having learned that the two ladies would refuse to testify unless granted immunity, the prosecutor obtained this and was then advised by their attorneys that they would testify, although not as the prosecutor might anticipate from statements they had given to agents of the FBI shortly after the robbery. This did not make it improper for the prosecutor to call them, see what they would actually do under the sanctity of the oath, compare United States v. Fiore, 443 F.2d 112 (2 Cir. 1971), and, if necessary, confront them with their previous statements to refresh their memory or, if that failed, to impeach them. See United States v. Graham, 102 F.2d 436 (2 Cir.), cert, denied, 307 U.S. 643, 59 S.Ct. 1041, 83 L.Ed. 1524 (1939); Stevens v. United States, 256 F.2d 619, 622-623 (9 Cir. 1958); United States v. Kahaner, 317 F.2d 459, 473-474 (2 Cir.), cert. denied, Corallo v. United States, 375 U.S. 835, 836, 84 S.Ct. 62, 11 L.Ed.2d 65 (1963); Goings v. United States, 377 F.2d 753 (8 Cir. 1967); McCormick, Evidence § 38, at 77 & n. 78 (Cleary ed. 1972). Such error as there may have been lay in the prosecutor’s endeavor to short-cut “the judicially sanctioned ritual,” see United States v. Kahaner, supra, 317 F.2d at 474, of first endeavoring to refresh the ladies’ recollection of each matter with the relevant passage of their statements to the FBI agents, then asking whether they had said what was reported and, if this,was denied, calling the agents to complete the impeachment. See McCormick, Evidence, supra, § 37, at 72-73. Instead, his method of interrogation in effect placed the statements directly before the jury. But any mistake was fully cured by the judge’s speedy and strong instructions that the jury was not to consider the statements to the FBI agents for any purpose other than as affecting the witnesses’ credibility and specifically not as evidence of the defendants’ guilt.

(3) Deputy Marshal Robinson, who had been in charge of the jury during the trial, was called by the government, rather late in the case, to testify that on the day of the robbery he had taken the fingerprints of Burket and Santana and had turned them over to a secretary to fill in the names and other facts. He identified the cards bearing the fingerprints, which an expert witness then compared with those removed from the getaway car in Burket’s case and from the Davis car in Santana’s. The defense attack is two-pronged. The first is that, at the beginning of the trial, the court, at the defense’s request, had imposed “the rule” excluding all prospective witnesses ; the other is that the marshal’s relations with the jury gave his testimony undue weight.

The first objection is frivolous. The purpose of imposing “the rule” in this case was to prevent identifying witnesses, including the police officers, from coordinating their stories. Nothing that Marshal Robinson had heard could affect his recollection, undisputed by anyone, that he had taken Burket’s fingerprints. On the second point, it was most careless of the Assistant United States Attorney not to have arranged for a different marshal to shepherd the jury. Although the prosecutor represented to us that he made an unsuccessful effort to that end with the chief marshal, he should have carried the matter to the judge, who, we are certain, would promptly have handled the problem, as he did, with his usual efficiency, after it finally came to his attention. There is no intimation that here, as in Parker v. Gladden, 385 U.S. 363, 87 S.Ct. 468, 17 L.Ed.2d 420 (1966), the marshal expressed any views on the merits of the case to the jury. Still, if Marshal Robinson had testified to anything over which there was any controversy, we might have considered reversal in the exercise of our supervisory power despite contrary authority, see 6 Wigmore, Evidence, supra, § 1912, at 608 n. 4, because of the importance that justice not only shall be done but shall seem to have been. But here there was no controversy at all. The only question asked of Robinson by the defense was whether he had used a special kind of ink, to which he answered that he had used a regular fingerprint pad, and the prints were received in evidence without objection. Again, while such prosecutorial conduct as this should not be repeated we see no justification for ordering a new trial.

Affirmed.

      . The government sought this because of its intention to call Mrs. Bortz and Mrs. Davis.

      . The government had evidently expected to establish Santana’s complicity by the testimony of Mrs. Bortz and Mrs. Davis, but this endeavor aborted as explained below.


author: WINTER, Circuit Judge:

text:
    John G. SWINNEY and R. S. Dickson and Company, a North Carolina Corporation, on behalf of themselves and all others similarly situated, Appellees, v. KEEBLER COMPANY, Appellant. John G. SWINNEY and R. S. Dickson and Company, a North Carolina Corporation, on behalf of themselves and all others similarly situated, Appellees, v. FLORA MIR CANDY CORPORATION et al., Appellants.
    Nos. 72-1968, 72-1969.
    United States Court of Appeals, Fourth Circuit.
    Argued March 7, 1973.
    Decided June 26, 1973.

      John M. Johnston, New York City (White & Case, Thomas Jefferson O’Sullivan, III, Vincent R. Fitzpatrick, Jr., New York City, H. Simmons Tate, Jr., J. Donald Dial, Jr., Boyd, Bruton, Knowlton, Tate & Finlay, Columbia, S. C., on brief) for appellants.
    David L. Freeman and C. T. Wyche; Greenville, S. C. (William W. Kehl, Wyche, Burgess, Freeman & Parham, P. A., Greenville, S. C., Russell M. Robinson, II, and Fleming, Robinson & Bradshaw, P. A., Charlotte, N. C., on brief) for appellees.
    Before WINTER, FIELD and WIDENER, Circuit Judges.
   WINTER, Circuit Judge:

Plaintiffs, two holders of a part of the defaulted $330,000, principal amount, seven percent subordinated debentures of Meadors, Inc. (Meadors), instituted this action for themselves and all other similarly situated Meadors’ debenture holders. The object of the suit was to obtain payment of the debentures or damages equal to the amounts unpaid. They named as defendants Meadors, the issuer of the debentures, and various' companies, including the parent of one, which successively had owned the stock of Meadors for the period August 7, 1963 to July 15, 1968, the date of suit, viz: (a) Keebler Company (Keebler), formerly United Biscuit Company of America, owner from August 7, 1963 to February 19, 1968; (b) Atlantic Services, Inc. (Atlantic), owner from February 19, 1968 to June 25, 1968; (c) Flora Mir Distributing Co., Inc. (Flora Mir Distributing), owner from June 25, 1968 to the date of suit; and (d) Flora Mir Candy Corporation (Flora Mir Candy), the parent corporation of Flora Mir Distributing. In a bifurcated trial, the district court, in essence, held all defendants liable to plaintiffs and assessed damages at $533,175, representing the principal amount of the debentures, interest through April 2, 1972, attorneys’ fees and expenses. To be exact, the district court rendered judgment in that amount against all defendants, except Meadors, for the benefit of Meadors and directed that any amounts paid in Meadors’ judgment be paid into court and then disbursed in payment of plaintiffs’ claims and expenses. Keebler has appealed on both the issues of its liability and the proper measure of damages, including attorneys’ fees.

Since Keebler is the only defendant who has appealed, we will confine our consideration to the case against it. The district court found that, in connection with the successive sales of Meadors’ stock from Keebler to Atlantic to Flora Mir Distributing, Meadors had been looted by Atlantic and its corporate assets dissipated, with the result, among others, that the interest and principal of the debentures were in default. Although the district court made no finding that Keebler had looted Meadors and, indeed, made no finding of any intentional wrongdoing on the part of Keebler, it nevertheless held Keebler liable for violation of its obligation to Meadors and Meadors’ debenture holders “[i]n light of all the circumstances known to Keebler ... to conduct such investigation of the purchaser [Atlantic] as would convince a reasonable man that the sale was legitimate, or to refrain from making the sale.” Swinney v. Keebler Company, 329 F.Supp. 216, 224 (D.S.C.1971).

We disagree that the circumstances were such as to give rise to an obligation on the part of Keebler to conduct an investigation of Atlantic beyond that which was actually conducted or . to refrain from making the sale. Accordingly, we reverse and direct the entry of judgment for Keebler.

I.

The district court’s extensive findings of fact are not challenged as clearly erroneous. Only the legal conclusions to be drawn from them are attacked. An extended factual recitation is therefore unnecessary.

Briefly stated, Keebler bought the stock of Meadors, a candy manufacturer, on August 7, 1963. At the time of the purchase, Meadors was in serious financial trouble and its debentures had a book value of less than one-half of their principal amount. Keebler operated Meadors, manufacturing and distributing candy and causing it to engage in other profitable operations so as to utilize a substantial tax loss carryback. By February, 1968, Meadors had total assets of $581,491, including cash of $321,337, and a net worth of $230,000.

Prior to February, 1968, Keebler decided to withdraw from the manufacturer of candy, but not its sale and distribution, and it concluded to sell Meadors. It employed a broker to find a buyer and subsequently began negotiations with Flora Mir Candy.

Negotiations with Flora Mir Candy proceeded to the point where the buyer was preparing to purchase Meadors for $176,000, although not all aspects of the transaction had been agreed upon, when on February 9, 1968, a Keebler officer, Mr. Chester Burehsted, received a telephone call from a broker, Mr. Olen, who indicated that Atlantic might be interested in purchasing Meadors. Burchsted agreed to meet Olen in the Newark airport on February 14, 1968, the same day that Burehsted was scheduled to be in New York to continue negotiations with Flora Mir Candy.

Burehsted and Olen met in the Newark airport on the morning of February 14, 1968, and as a result of the meeting an afternoon session was arranged in New York at the offices of Keebler’s lawyers between Altantic’s counsel, Ivan Ezrine, Esquire, and several representatives of Keebler, including Edward Vincek, Esquire, Keebler’s general counsel. In the meantime, Keebler’s negotiations with Flora Mir Candy were suspended.

During the afternoon meeting, Keebler’s various representatives questioned Ezrine concerning Atlantic, its financing structure and its corporate and financial history. Ezrine told Keebler that Atlantic was a prospering small holding company which was becoming a conglomerate and wanted to diversify by expanding into the candy business. Ezrine gave Keebler recent unaudited financial statements, prepared by certified public accountants, which showed that Atlantic had a net worth of $997,000 as of December 31, 1967, and net income of $158,588 for that calendar year.

At the February 14 meeting, Keebler and Atlantic negotiated an agreement for the sale of Meadors’ stock, and the agreement was executed that day or the next. The contract documents were patterned largely on those which had been prepared while the negotiations with Flora Mir Candy were continuing. Among other things, the following agreements were reached: (1) the sales price was set at $235,000, (2) Atlantic represented its financial statement of December 31, 1967 as true, correct, and prepared in accordance with generally accepted accounting principles, (3) Atlantic promised, as a condition of the sale, that its financial strength on the closing date would be substantially the same or better than shown in its December 31, 1967 statements, (4) Atlantic agreed to guarantee Meadors’ accounts payable and accruals, (5) Atlantic agreed to guarantee payment of the interest and principal of the Meadors’ seven percent subordinated debentures, and (6) Atlantic agreed to indemnify Keebler from any liability arising out of the sale.

Keebler, for its part, warranted as true and correct its representations including the Meadors’ balance sheet, the list of outstanding contracts and the list of Meadors’ tangible properties. Keebler promised to use its best efforts to retain Meadors’ personnel except officers and directors who were Keebler’s nominees, and it agreed to purchase $562,000 worth of candy from Meadors within the ensuing nine-month period.

The closing was held in Greenville, South Carolina, on February 19. Prior thereto, Atlantic sent its certified public accountant to the Meadors’ plant twice to inspect it. The accountant found a minor discrepancy in the properties of Meadors and the parties agreed to a $5,000 reduction in the ultimate purchase price paid by Atlantic on that account. Once at the negotiating session and once prior to the closing, Ezrine inquired of Vincek as to the possibility of making some arrangement to avoid Atlantic’s bringing the funds for consummation of the transaction from New York. Both times Vincek rejected the suggestion and advised Ezrine that it was Atlantic’s responsibility to finance the purchase.

At the closing, various documents were executed and delivered, including a licensing agreement which permitted Meadors to use Keebler’s “Kitchen Rich” trademark under which Meadors’ candy had been sold, and a detailed bill of sale conveying to Meadors all machinery and equipment theretofore on lease from Keebler. Although there was no evidence to show that Keebler was aware of what had transpired, Atlantic made a one-day borrowing of $235,000 from the People’s National Bank, a bank in Greenville where Meadors had its account. Atlantic deposited the loan proceeds in an account in its name, then bought a $230,000 banker’s check drawn on a New York bank in favor of Keebler for the adjusted purchase price. After the closing, Atlantic transferred $310,000 from the Meadors’ account to its own account and repaid the loan. The transfer of funds was shown on Meadors’ books as a loan to Atlantic — an account receivable — and on Atlantic’s books as a loan from Meadors — an account payable.

Keebler had nothing further to do with Meadors after the closing except for the purchase of candy pursuant to the candy contract.

Atlantic retained ownership of Meadors for approximately four months and repaid approximately $33,200 of its loan. During this period, Meadors paid its trade accounts and made a profit of approximately $19,000. Atlantic’s efforts to build up an independent sales force and find markets for its candy other than Keebler were largely unsuccessful, and Atlantic then sold the stock to Flora Mir Distributing, a subsidiary of Flora Mir Candy, on June 25, 1968, for a purchase price of $352,000. At that closing, Atlantic’s accounts payable to Meadors was repaid; but Flora Mir Distributing, perpetuating the pattern established by Atlantic, thereafter withdrew funds from Meadors, reflected on Meadors’ books as‘a loan to Flora Mir Distributing. Flora Mir Distributing acquired other candy companies, and Flora Mir Distributing treated itself and its subsidiaries as a single company, transferring monies and properties from one to the other. Initially, the group experienced success with their combined operations, but ultimately the combination became short of working capital and went into bankruptcy.

II.

The parties do not seriously dispute the applicable law. The district court, correctly, we think, drew upon the leading case of Insuranshares Corporation v. Northern Fiscal Corporation, 35 F.Supp. 22 (E.D.Pa.1940), which held the sellers of a controlling interest in a corporation liable to the corporation when the buyers proceeded to loot it after their acquisition of control. Liability was predicated upon breach of a duty not to transfer control since the circumstances surrounding the transfer were “such as to awaken suspicion and put a prudent man on his guard — unless a reasonably adequate investigation discloses such facts as would convince a reasonable person that no fraud is intended or likely to result.” 35 F.Supp. at 25.

In Insuranshares, the suspicious circumstances included (1) the defendants' probable knowledge that the purchase was to be financed by a pledge of the corporation’s assets, (2) the corporation’s president’s clear predisposition to allow a sale to be financed by pledging those assets as security, (3) defendants’ awareness of the purchasers’ plan to have a large part of the corporation’s assets converted into cash prior to the sale, (4) the inflated price or premium paid for control, especially given the nature of the business which was an investment trust with no physical assets but only the ready equivalent of cash in the form of marketable securities, (5) warnings from the sellers’ attorneys as to their potential liabilities for dealing with little-known purchasers, and (6) the fact that the corporation had been looted five years before by a different group who had gained control by using the same method of financing.

The standard of conduct to which Insuranshares holds controlling transferors had been widely accepted, Estate of Hooper v. Govt, of Virgin Islands, 427 F.2d 45, 47 (3 Cir. 1969) ; McDaniel v. Painter, 418 F.2d 545, 547 (10 Cir. 1970); Seagrave Corporation v. Mount, 212 F.2d 389, 395 (6 Cir. 1954) ; Northway, Inc. v. TSC Industries, Inc., CCH Fed.Sec.L.Rep. [f 93,646 (N.D.Ill., Sept. 28, 1972). Generally, the owner of corporate stock may dispose of his shares as he sees fit. Alderman v. Alderman, 178 S.C. 9, 43, 181 S.E.2d 897, 911 (1935). A dominant or majority stockholder does not become a fiduciary for other stockholders merely by owning stock, McDaniel v. Painter, supra. In selling their stock, the stockholders necessarily act for themselves, and not as trustees for the other stockholders. Gerdes v. Reynolds, 28 N.Y.S.2d 662, 650 (Sup.Ct.N.Y.Co., 1941). But majority stockholders who assume the management of the corporation, as Keebler did here, can be said to stand in fiduciary relation to the minority under certain circumstances. ^ Thus, while the majority is not an absolute insurer against any wrongs which may be done to the corporation after the transfer of control or against any decisions by the new owners that may not be in the best interest of the minority, if the sellers of control are in a position to foresee the likelihood of fraud on the corporation, including its creditors (Pepper v. Litton, 308 U.S. 295, 307, 60 S.Ct. 238, 84 L.Ed. 281 (1939)), or on the remaining stockholders, at the hands of the transferee, their fiduciary duty imposes a positive duty to investigate the motives and reputation of the would-be purchaser; and unless such a reasonable investigation shows that to a reasonable man no fraud is intended or likely to result, the sellers must refrain from the transfer of control.

III.

In light of the facts and applicable law, plaintiffs’ right to recover turns on whether Keebler had sufficient knowledge to foresee the likelihood of fraud so as to give rise to a duty to conduct a further investigation and to satisfy itself, by the test of a reasonable man, that no fraud was intended or likely to result before it consummated the sale of control. The district court identified essentially seven circumstances which “might have indicated [to Keebler] that Atlantic Services had no intention of operating Meadors . . ..” 329 F.Supp. at 220. These factors were: (1) no one from Atlantic had any experience in the candy business, (2) at the time the contract was executed no one from Atlantic had inspected the “Meadors operation,” (3) by the time of the closing, only Atlantic’s accountant had examined Meadors to “any appreciable extent and he was interested principally in the books and inventory,” (4) Meadors had no market of its own and the “profit as shown could not have been accepted at face value by an outsider,” (5) prior to the closing Atlantic had no negotiations with Meadors’ key employees concerning the continuation of the business, (6) the sale was consummated with dispatch, and (7) Atlantic had inquired as to the availability of Meadors’ funds for payment of the purchase price. Although the district court concluded that the first five factors were “not necessarily inconsistent with a legitimate sale of a business the size of Meadors,” it held that when coupled with facts six and seven, they “were more than sufficient to arouse the suspicion of Keebler.” 329 F.Supp. at 220.

We think that the findings of fact relied on by the district court to conclude that Keebler was liable to Meadors’ debenture holders were insufficient to support that result. We will comment on them seriatim.

From Keebler’s point of view, the fact that no one from Atlantic had any experience in the candy business should not have been suspicious. Atlantic was represented to Keebler as a holding and investment company which did business through subsidiaries. A conglomerate, which Atlantic professed to be aspiring, regularly acquires diverse businesses; and in any event, it is not unusual for any corporation to venture into a new business field. Meadors was an integrated functioning enterprise with management and equipment in place, and Keebler agreed, except with respect to Meadors’ officers and directors, which were Keebler personnel, to use its best efforts to maintain intact other personnel of Meadors then on Meadors’ payroll. As a result of Keebler’s agreement to purchase candy for a nine-month period, Keebler could assume that Meadors would have, at least for the short run, a ready market for candy and an opportunity to recruit and train a sales force.

No suspicion should have been aroused from the fact that no one from Atlantic inspected the Meadors’ operation prior to execution of the contract, and that at the time of closing, only Atlantic’s accountant had examined Meadors to any appreciable extent. Atlantic’s broker, Olen, who first telephoned Keebler’s Burchsted, had some familiarity with Meadors, albeit apparently obtained from the broker retained by Keebler. Keebler made extensive warranties concerning the plant and its financial operations and were these warranties untrue, Atlantic might have rescinded the sale or sued for damages. A sufficient inspection prior to closing was made so that the parties agreed to a $5,000 reduction in the purchase price. From Keebler’s point of view, Atlantic’s reliance on its broker, on Keebler’s warranties, and on Atlantic’s accountant's inspections was hardly a circumstance indicative of an intention not to operate, much less of an intention to loot.

We see nothing suspicious in the fact that Meadors had no market of its own, and we do not agree that the profit as shown on Meadors’ financial statements could not have been accepted at face value by an outsider. While Meadors’ past profit history may have been somewhat questionable, its operation by Keebler was profitable, and Keebler warranted Meadors’ balance sheet at the time of closing. There is no question but that Keebler’s agreement to purchase candy provided Meadors with a substantial initial market, and Keebler could have reasonably assumed that during the period and with the financial support of its purchase of candy, Meadors could build up its own market. ' Keebler cannot be held liable as a result of its failure to sell Meadors to a company with a candy market already well developed. Only a small portion of the business community could live under such a restrictive rule with regard to the purchase and sale of business enterprises.

Nor do we find significant the fact that prior to closing, Atlantic conducted no negotiations with key employees then operating Meadors relative to their continuation of the business. Keebler contracted to use its best efforts to retain them as employees, and Atlantic did retain them after it took over. The wisdom of Atlantic’s failure to negotiate with them prior to closing is not in issue —only its impact on Keebler as a “suspicious circumstance” is significant. Since Keebler owned Meadors, had full power to sell the company, and agreed to do its part in keeping the enterprise intact, we do not think that Keebler was confronted with a suspicious circumstance.

The dispatch with which the sale was consummated was not suspicious. In the first place, no reason to delay closing has been suggested. In any event, any haste was principally that of Keebler’s making and not that of Atlantic. Keebler had been prepared to sell Meadors to Flora Mir Candy; active negotiations were being carried on and legal papers to consummate the transaction were in the course of preparation when Atlantic appeared on the scene. When agreement with Atlantic was reached, Keebler was pressing to consummate a more profitable transaction in lieu of a less profitable one before the latter was irrevocably lost.

The inquiries made by Atlantic with regard to the availability of Meadors’ funds for payment of the purchase price were not such as to provide a basis on which Keebler could suspect how payment would be made, especially, since Keebler made its position clear that Atlantic must consummate the purchase with its own funds. It is true that the record shows that Atlantic did not do so, but the record does not disclose an evidentiary basis to find, nor did the district court find, that Keebler knew or had reason to know of Atlantic’s one-day loan and its immediate repayment with Meadors’ funds. Whatever inkling Keebler may have had that Atlantic was interested in using Meadors’ cash did not rise to a level sufficient to necessitate further investigation, especially in light of Atlantic’s seemingly strong financial position and its apparent ability to finance the transaction with its own monies.

Overall, we conclude that the seven factors considered singly or in concert, were not sufficient to suggest to Keebler that Atlantic did not intend to operate Meadors, but rather intended to loot it. As our discussion of the findings relied on to support the contrary conclusion discloses, there were many positive indications that Atlantic intended to operate Meadors and to operate it profitably. In addition, Atlantic’s guarantee of the payment of principal of and interest on Meadors’ debentures was significant, especially in the light of Atlantic’s apparent financial ability to fulfill that commitment. It follows, we think, that Keebler’s obligation to conduct a further investigation sufficient to satisfy a reasonable man that no, fraud was intended or likely to result, or to refrain from the transfer of control, did not arise. The obligation could not have been breached, so that there was therefore no basis to impose liability on Keebler.

Reversed.

      . All defendants, except Keebler, are the subject of Chapter XI bankruptcy proceedings in the Southern District of New York. This fact may explain why only Keebler has appealed. This fact does explain why plaintiffs are vigorous in their attempt to uphold their judgment against Keebler.

      . These figures were before any charge for management service provided by Keebler or any allocation to Meadors of any portion of Keebler’s overhead.

      . Prior to this meeting, Burehsted requested a Dun and Bradstreet report on Atlantic. He received an oral report that a company named Paco was at the address given as Atlantic’s offices. In later discussions, Burehsted was advised by representatives of Atlantic that Paco was one of its subsidiaries.

      . The Keebler-Atlantie agreement subsequently executed required that Atlantic provide Keebler with audited statements. These were delivered in August, 1968, and as found by the district court, they “reflected an increased net worth for Atlantic . . . .” They showed a net worth of $1,249,472 and earnings of $259,604.

      . In the instant case, the district court was exercising diversity jurisdiction. While it was cognizant that the law of South Carolina might be the governing law, it found no South Carolina case on point.

      . ' The district court properly rejected the test applied in Levy v. American Beverage Corp., 265 App.Div. 208, 38 N.Y.S. 2d 517, 526 (1942), to the effect that, before the transferor can be found liable, it must have actual notice that the transferee intends to loot the corporation.
      We agree with the district court that “[t]o require knowledge of the intended looting on the part of the seller in order to impose liability on him places a premium on the ‘head in the sand’ approach to corporate sales,” 329 F.Supp. at 223, and with Judge Friendly that “[t]o hold the seller for delinquencies of the new directors only if he knew the purchaser was an intending looter is not a sufficient sanction.” Essex Universal Corporation v. Yates, 305 F.2d 572, 581 (2 Cir. 1962) (concurring opinion).

      . See 6 Cavitch, Business Organizations § 120.03 [3] [c], pp. 756, 767; 13 Fletcher Cyclopedia of Corporations, § 5805, p. 99 (Perm.Ed. 1970). See also Loss, Securities Regulation pp. 1469-70 (1961 Ed.).

      . In a negligence case, when the evidentiary facts are not substantially in dispute, “the ultimate conclusion to be drawn from the basic facts ... is actually a question of law.” Hicks v. United States, 368 F.2d 626, 631 (4 Cir. 1966). This is the rule in this circuit, although it has been criticized in 9 Wright and Miller: Federal Practice and Procedure, § 2590 (1971). We think it applicable iiere.

      . The district court found that when Atlantic, the day after the closing, borrowed funds from Meadors to repay Peopie’s National Bank, Atlantic had the financial ability to repay the loan.


author: O’SULLIVAN, Senior Circuit Judge.

text:
    Betty ASHER, Defendant-Appellant, v. UNITED STATES of America, Plaintiff-Appellee.
    No. 72-1966.
    United States Court of Appeals, Sixth Circuit..
    Argued April 6, 1973.
    Decided June 14, 1973.
    Lowell W. Lundy (court appointed), Barbourville, Ky., for defendant-appellant.
    Moss Noble, Asst. U. S. Atty., for plaintiff-appellee; Eugene E. Siler, Jr., U. S. Atty., Lexington, Ky., on brief.

      Before PECK and LIVELY, Circuit Judges, and O’SULLIVAN, Senior Circuit Judge.
   O’SULLIVAN, Senior Circuit Judge.

Appellant, Betty Asher, was convicted of forgery under Title 18, U.S.C. § 495. She was the niece of Betty Lou Elliott who, as the widow of a Spanish War Veteran and as the dependent mother of one Willard Elliott who was killed in the Korean War, was receiving monthly pension checks from the Veterans’ Administration. In 1963, the aunt, Betty Lou Elliott, was adjudged incompetent and remained so until her death. Betty Asher was appointed custodian for her incompetent aunt, and thereafter was officially recognized as “Custodian of Betty L. Elliott.” Her aunt’s pension checks were thereafter made payable to “Betty Asher, Custodian of Betty L. Elliott,” were received by her, and were endorsed:

“Betty Asher Betty L. Elliott”

They were accepted and cashed by the Veterans’ Administration. The aunt died in 1965, but notice of her death was not given to the Veterans’ Administration and the pension checks, made payable to “Betty Asher, Custodian of Betty L. Elliott,” continued to be sent to the niece. Appellant endorsed these checks, in the above style, and converted the proceeds to her own use until July 1, 1971, when her conversions were discovered and the checks were stopped. A ninety-five count indictment was returned against appellant, charging violations of Title 18 U.S.C. § 495, in the following form and covering the respective dates of the cashing of the checks.

“On or about the 31st day of January, 1966, in Bell County, in the Eastern District of Kentucky,

BETTY ASHER

with intent to defraud the United States, did utter and publish as true, Check No. 49,226,866, symbol 1073, dated January 31, 1966, in the amount of $75.00, payable to Betty Asher, Custodian of Betty L. Elliott, drawn on the Treasurer of the United States, with the falsely made and forged endorsement

Betty Asher Betty L. Elliott
on the back of said check, the said Betty Asher then well knew said endorsement to be falsely made and forged in that her custodial relationship to said Betty L. Elliott had theretofore terminated by death.”

Prior to trial, appellant's motion to dismiss, charging that the indictment did not charge a violation of Title 18 U.S.C. § 495, was denied. At the close of the proofs, a motion for direction of acquittal which asserted that appellant’s conduct did not amount to forgery and was not otherwise in violation of § 495, was denied.

The government’s brief correctly states the issue before us as follows:

“Where a custodial relationship has been terminated by death, and the custodian has fraudulently concealed the pensioner’s death from the Veterans Administration and thereby continues to receive and cash monthly pension cheeks, is there a violation within the provisions of Section 495, Title 18, United States Code?”

We reverse.

Appellant did not take the stand and there was clear proof that she knew of her own wrongdoing — that she had, in effect, stolen the proceeds of the involved pension checks from the United States Government. With some reluctance and misgivings, we are constrained, however, to hold that the government did not make out a case of forgery within the contemplation of Title 18 U.S.C. § 495.

For our ruling, we rely primarily upon the decision of the United States Supreme Court in Gilbert v. United States, 370 U.S. 650, 82 S.Ct. 1399, 8 L.Ed.2d 750 (1962), and the Tenth'Circuit’s decision in Selvidge v. United States, 290 F. 2d 894 (10th Cir. 1961), which the Supreme Court approved in its Gilbert decision. Therein the Supreme Court said that Selvidge,

“held that ‘forgery’ under § 495 does not embrace a purported, but misrepresented, agency endorsement (hereafter called simply an ‘agency endorsement’). * * * For reasons given in this opinion we agree with the Tenth Circuit.” 370 U.S. at 652, 82 S.Ct. at 1401.

We are of the view that appellant here did no more than endorse the name of the payee of the check, viz: herself, and the writing of her own name was not a forgery. Her endorsement on the fraudulently cashed checks was in the same style as had been the custom during the period that she had been properly receiving and endorsing the checks. All of the checks, before her aunt’s death and afterward, were payable to appellant as “custodian” and the style of her endorsement was merely,

“Betty Asher Betty L. Elliott”

This endorsement never changed. The government does not charge that appellant, in writing her aunt’s name, was holding out that such writing was in fact the signature of her aunt. A technically correct endorsement of all of the checks issued while appellant was, in fact, “custodian” would have been “Betty Asher, Custodian of Betty L. Elliott.” The endorsement actually used prior to, and after, the aunt’s death was accepted as sufficient by the Veterans’ Administration. At the trial, a handwriting expert testified that the handwriting of “Betty Asher” and “Betty L. Elliott” was by the same hand, and there was no evidence that appellant ever wrote the name of her aunt, Betty Elliott, representing that such was her aunt’s signature. There was no evidence that appellant ever forged her aunt’s name. The handwriting expert testified that all of the checks were endorsed by the person to whom the cheeks were made payable.

While we rely on Gilbert v. United States, 370 U.S. 650, 82 S.Ct. 1399, 8 L. Ed.2d 750, and Selvidge v. United States, 290 F.2d 894, supra, we have in mind that the facts in each of them expose some distinction from the case at bar. We do not consider, however, that such distinctions forbid our employing Gilbert and Selvidge as controlling authority here. Involved in Gilbert were tax refund checks payable to “Daniel H. and Charlene R. Bartfield, % R. Milo Gilbert, 519 Taft Building, Hollywood 28 Calif.” The accused Gilbert, defendant in that case, endorsed the checks in the following manner:

“Daniel H. Bartfield Charline R. Bartfield R. Milo Gilbert, Trustee”

There, as here, the accused’s own signature on the endorsement was his own. He claimed that he had a written power of attorney from the Bartfields which authorized him to endorse the checks as he did. The Bartfields denied this. From a fair reading of the ease, we conclude that the government was not there claiming that Gilbert’s writing of the names of the Bartfields was a representation that they had, in fact, written their own names on the endorsement. It was his claim that, at most, his endorsement was an “agency endorsement.” He asked that the jury be instructed that an “agency endorsement” was not forgery under § 495. This was refused, and such refusal was held to be error.

Gilbert’s endorsement described himself as “Trustee,” whereas Betty Asher did not use any qualifying adjective after her own genuine signature, such as “Custodian.” In our view, her failure to do so, does not impair the validity of our conclusion that Gilbert commands the decision we make. She was the payee of the checks and her endorsement, without using the word custodian, had been accepted as sufficient in the earlier, valid negotiation of the checks. We believe that the wrongful endorsement must be viewed as an “agency endorsement,” however fraudulent. She was, indeed, representing that she was still the “Custodian” or agent of her deceased aunt. In Gilbert, the Supreme Court said:

“Where the ‘falsity lies in the representation of facts, not in the genuineness of execution,’ it is not forgery.” 370 U.S. at 658, 82 S.Ct. at 1404.

For this quoted statement, the Supreme Court cited Marteney v. United States, 216 F.2d 760, 763-764 (10th Cir. 1954).

In the Selvidge case, the defendant had had authority to endorse her employer company’s name on its incoming checks for deposit only. But on the checks which were the subject of the indictment, she wrongfully endorsed the name of her employer, adding thereto her own signature as follows: “By Thelma L. Selvidge.” The Court there said:

“If Selvidge had merely endorsed the name of her principal and cashed the checks contrary to her instructions, the crime of forgery would have been complete. It is a rule of general application that an agent may commit forgery by making or signing an instrument in disobedience of his instructions or by exceeding his authority. But when she added her genuine signature purporting to endorse the checks as the agent of her named principal, although she had no authority to do so, she was not guilty of forgery.” 290 F.2d at 895. We do not think that the word “By”

in front of her own name makes Selvidge without analogy here. In Wright v. United States, 172 F.2d 310, also cited by the Supreme Court in Gilbert, the Ninth Circuit said:

“[I]t has generally been held that the genuine making of a writing for the purpose of defrauding another is not forgery.” 172 F.2d at 311.

We reverse and direct entry of an order acquitting appellant of the charge of forgery under 18 U.S.C. § 495.

      . Twenty-nine of the counts were dismissed as barred by the Statute of Limitations. Appellant was convicted upon the remaining sixty-six counts and sentenced to prison for three years.

      . Upon oral argument, government counsel suggested that appellant could also have been charged with violation of 88 U.S.C. § 3501. We express no opinion on this but mention that if such action is still available, many of the specific check cashing incidents would not be barred by the five year general statute of limitations— 18 U.S.C. § 3282. Appellant’s relevant misconduct continued until 1971.


text:
    Rebecca E. HENRY et al., Plaintiffs-Appellees, v. The CLARKSDALE MUNICIPAL SEPARATE SCHOOL DISTRICT et al., Defendants-Appellants.
    No. 72-3283.
    United States Court of Appeals, Fifth Circuit.
    June 22, 1973.

      Semmes Luckett, Clarksdale, Miss., for defendants-appellants.
    Melvyn R. Leventhal, Jackson, Miss., Jack Greenberg, New York City, David Norman, Asst. Atty. Gen., Civil Rights Div., U. S. Dept. of Justice, Washington, D. C., for plaintiffs-appellees.
    Before WISDOM, COLEMAN and SIMPSON, Circuit Judges.
   PER CURIAM:

After much litigation, including numerous appeals to this Court, Henry v. Clarksdale Municipal Separate School District, 5 Cir. 1969, 409 F.2d 682, cert. denied, 396 U.S. 940, 90 S.Ct. 375, 24 L.Ed.2d 242 (Clarksdale I); Henry v. Clarksdale Municipal Separate School District, 5 Cir. 1970, 425 F.2d 698 (Clarksdale II); and Henry v. Clarksdale Municipal Separate School District, 5 Cir. 1970, 433 F.2d 387 (Clarksdale III), the defendants agreed to adopt any plan which the plaintiffs might select, and the district court approve, designed to bring about a unitary nonracial school system. As a result, a desegregation plan commencing with the 1971-1972 school year was proposed and adopted by the district court. This plan includes the assignment of elementary school pupils to schools located outside of both their home and adjacent-to-home zones.

In July 1972, the district judge, relying on United States v. Greenwood Municipal Separate School District, 5 Cir. 1972, 460 F.2d 1205, granted plaintiffs’ request to have transportation provided to those students living more than one and one-half miles from their assigned schools and denied defendants’ request to minimize the transportation requirements that would be involved by making certain alterations to the existing plan. Defendants contend our decisions in Cisneros v. Corpus Christi Independent School District, 5 Cir. en banc 1972, 467 F.2d 142, and United States v. Texas Education Agency, 5 Cir. en banc 1972, 467 F.2d 848, make Greenwood, supra, inoperative in the situation at bar at least to the extent relied on by the district judge. We affirm.

We had previously struck down the neighborhood school concept as it applied in Clarksdale, Clarksdale I and III and agree with the court below that defendants’ proposal to minimize transportation would result in a regression to those earlier stages which this Court has found to be wanting. Enrollment at the formerly all-white Kirkpatrick elementary school would change from 90 white and 118 black students at present to a projected enrollment of 90 white and only 3 black students. Further, many black students, perhaps as many as 115, would be reassigned from schools situated in the predominantly white neighborhoods north of the Illinois Central Railroad tracks, see Clarksdale I, supra, 409 F.2d at 685-686, back to formerly all-black schools south of the tracks in the largely black neighborhood. Cisneros, supra, and Texas Education Agency, supra, do not authorize the resegregation of schools nor do they affect Greenwood’s requirement that school officials take whatever remedial steps are necessary to disestablish the dual school system, “including the provision of free bus transportation to students required to attend schools outside their neighborhoods”, 460 F.2d at 1207. The district judge was correct in concluding defendants’ proposals are “not permissible in the present state of this case” and that Cisneros, supra, and Texas Education Agency, supra, do not support a conclusion to the contrary.

Plaintiffs’ request for attorneys’ fees under Section 718 of the Education Amendments Act of 1972 must be granted in the absence of special circumstances upon “the entry of a final order”. Johnson v. Combs, 5 Cir. 1972, 471 F.2d 84. Under the teachings of Johnson, Section 718 is not to be applied retroactively “to the expenses incurred during the years of litigation pri- or to its enactment”, 471 F.2d at 86-87. As to the period since the effective date of Section 718, July 1, 1972, attorneys’ fees must be awarded “unless special circumstances render such an award unjust.” Newman v. Piggie Park Enterprises, Inc., 1968, 390 U.S. 400, 401, 88 S.Ct. 964, 966, 19 L.Ed.2d 1263.

In order to recover attorneys’ fees for the years of prior litigation of this case before the district court and before this Court, the appellees will have to demonstrate to the trial court and the trial court must find that the appellant school board during those years acted in an “unreasonable and obdurately obstinate” manner. See Williams v. Kimbrough, 5 Cir. 1969, 415 F. 2d 874, cert. denied 1970, 396 U.S. 1061, 90 S.Ct. 753, 24 L.Ed.2d 755 (citing Kemp v. Beasley, 8 Cir. 1965, 352 F.2d 14), and Horton v. Lawrence County Board of Education, 5 Cir. 1971, 449 F.2d 793.

Since the appellants have failed to cite any special circumstances, the district court upon the entry of a final order in this case, is directed to grant appellees’ request for reasonable attorneys’ fees incurred since July 1, 1972. The district court shall also grant a hearing to determine whether or not the appellants’ actions in this lawsuit were carried out in an “unreasonable and obdurately obstinate” manner in the years preceding July 1, 1972, so as to entitle appellees to be awarded reasonable attorneys’ fees for services before that date.

Affirmed and remanded.

      . Our holding in Johnson is cited with approval by the Supreme Court in its per curiam decision of June 4, 1973, in No. 72-1164, Northcross v. Memphis Board of Education, 412 U.S. 427, 93 S.Ct. 2201, 37 L.Ed.2d 48.