author: WALLACE, Circuit Judge: MERRILL, Circuit Judge, with whom PECKHAM, District Judge,

text:
    UNITED STATES of America, Plaintiff-Appellee, v. Stephen Kirk HEIDEN, Defendant-Appellant. UNITED STATES of America, Plaintiff-Appellee, v. Larry Arnold KLEIN, Defendant-Appellant.
    Nos. 73-1471 and 73-1570.
    United States Court of Appeals, Ninth Circuit.
    Dec. 16, 1974.

      R. N. Harris, Jr., Harris & Hoffman, Los Angeles, Cal. (in 73 — 1471), Sherman Ellison, Beverly Hills, Cal., for defendants-appellants.
    Harry D. Steward, U. S. Atty., San Diego, Cal., for plaintiff-appellee.
    Before MERRILL and WALLACE, Circuit Judges, and PECKHAM, District Judge.

       Honorable Robert F. Peckham, United States District Judge, Northern District of California, sitting by designation.

   OPINION

WALLACE, Circuit Judge:

Heiden and Klein appeal their convictions, following a nonjury trial, of unlawful possession of marijuana with intent to distribute in violation of 21 U.S.C. § 841(a)(1). Both were in a vehicle which was stopped by Border Patrol agents at the San Onofre fixed checkpoint and found to have approximately 110 pounds of marijuana in the trunk. They raise questions concerning claimed Fourth Amendment violations, sufficiency of the evidence to sustain the judgment and loss of certain evidence. We affirm.

The vehicle was stopped at the San Onofre checkpoint on April 24, 1972, and, because it was “setting low” in the rear, was directed to a secondary inspection area to be searched for illegal aliens. Agent Brady told the driver of the vehicle, Klein, to open the trunk but Klein responded that he could not do so because he had loaned the car to his sister who still had the trunk keys. Klein was directed to remove the back seat but responded that he did not know how to do so. Agent Batchf elder then entered the car and, together with Klein, removed the seat. Batchf elder smelled marijuana and directed Brady to “go in and take a look.” Brady entered the vehicle and saw a cardboard beer box which was damaged on one corner. Through the damaged corner, Brady saw a package wrapped in a yellow paper which also had a hole in it. After sticking his finger into the hole, Brady could see a substance like marijuana. Heiden and Klein were then arrested and both were searched while at San Onofre. The missing trunk key was found in Heiden’s sock.

I

Heiden and Klein claim the stop and subsequent search by the Border Patrol agents were invalid under Almeida-Sanchez v. United States, 413 U.S. 266, 93 S.Ct. 2535, 37 L.Ed.2d 596 (1973). The events of this case transpired prior to the decision in Almeida-Sanehez and that case has no retroactive effects to stops and searches at fixed checkpoints. United States v. Bowen, 500 F.2d 960 (9th Cir.), cert. granted, 419 U.S. 824, 95 S.Ct. 40, 42 L.Ed.2d 47 (1974). Thus, the officers could properly look into the trunk.

II

In order to justify a search for contraband into the contents of the trunk (the box and two footlockers), the agents must have probable cause. Fumagalli v. United States, 429 F.2d 1011, 1013 (9th Cir. 1970). Probable cause, however, may be supplied by the smell of marijuana. United States v. Barron, 472 F.2d 1215, 1217 (9th Cir.), cert. denied, 413 U.S. 920, 93 S.Ct. 3063, 37 L.Ed.2d 1041 (1973); United States v. Leazar, 460 F.2d 982, 984 (9th Cir. 1972).

Agent Batchfelder testified that while he and Klein were removing the rear seat, he smelled a strong odor of marijuana. At this point, Batchfelder had probable cause to search the contents of the trunk. Instead of conducting the search himself, however, Batchfelder directed Brady to “go in and take a look.” Brady did not testify that he smelled the odor of marijuana. Heiden and Klein contend that in order for the search by Brady to be supported by probable cause, Batchfelder had to tell Brady that he had smelled the marijuana or in some way had to communicate to Brady that he, Batchfelder, had probable cause to search at the time he directed Brady to conduct the search.

A similar argument was made in United States v. Mastberg, 503 F.2d 465 (9th Cir. 1974). There, we found that Border Patrol agents had the necessary real suspicion to justify a strip search of Mast-berg. They directed a matron to conduct the search but did not tell her the basis for their suspicions. Mastberg argued that the search by the matron was illegal because the matron did not possess all of the facts justifying the search. In rejecting Mastberg’s argument, we said:

The testimony of the matron demonstrates that she knew that the inspectors believed they had evidence that Mastberg was attempting to smuggle something, otherwise they would not have called upon her to conduct a strip search. It would be an absurdity and a miscarriage of justice for us to reverse this case simply because the inspectors did not communicate to the matron what they considered to be objective, articulable facts to justify a strip search. To require the inspectors to convey the basis of their suspicion to the matron would only be a meaningless gesture which could serve no useful purpose for either law enforcement or protection of an individual’s personal rights. In United States v. Velasquez, 469 F.2d 264, 266 (9th Cir. 1972), we rejected the argument that customs inspectors must convey their knowledge of the facts to a physician before he can conduct a rectal probe. The same principle applies here.

United States v. Mastberg, supra, 503 F.2d at 470-471. This is not a case of reprehensible police conduct and we discern no reason to hamper law enforcement with meaningless technical distinctions. Batchfelder, having probable cause, could have searched the contents of the trunk. We see no reason to reverse these convictions because Batch-felder’s partner in this operation conducted the search at Batchfelder’s direction. Cf. United States v. Ragsdale, 470 F.2d 24 (5th Cir. 1972).

Ill

Heiden argues that the key found in his sock should have been suppressed because the officer did not have probable cause to arrest him and, therefore, the search could not have been pursuant to a lawful arrest. He also argues that the evidence was insufficient to convict him.

The officers had probable cause to arrest Heiden because they reasonably believed that he was involved in the transporting of 110 pounds of marijuana. The officers were not required to believe his explanation that he did not know about the marijuana. Whether Heiden could later establish that he was only a passenger and did not know about the marijuana was no reason for the officers to let him go free. The passenger doctrine, Bettis v. United States, 408 F.2d 563 (9th Cir. 1969), is not applicable to Heiden’s arrest. In the absence of the discovered key, the passenger doctrine might have precluded his conviction of the charges but that doctrine cannot invalidate his arrest. In relation to a passenger in a vehicle containing marijuana, we said in Bettis:

This might be sufficient as a basis for making an arrest of him at the scene as a probable party to the importation. It would not, however, be sufficient as a basis to convict him of having been in fact a party to the importation.

408 F.2d at 567.

The search, during which the key was discovered, was pursuant to a valid arrest and was lawful. United States v. Rogers, 453 F.2d 860 (9th Cir. 1971). It was conducted in the interrogation room at the San Onofre checkpoint while arrest forms were being processed and just prior to taking Heiden to the San Diego Jail. Simply because the search was of Heiden’s sock does not vitiate the search; the officers had a legitimate reason to search for other contraband or weapons prior to transporting him to jail. United States v. Robinson, 414 U.S. 218, 94 S.Ct. 467, 38 L.Ed.2d 427 (1974).

Heiden’s possession of the trunk key is sufficient to support his conviction for possession of the marijuana. United States v. Ramos, 476 F.2d 624, 626 (9th Cir.), cert. denied, 414 U.S. 836, 94 S.Ct. 182, 38 L.Ed.2d 72 (1973).

IV

Heiden and Klein also contend that they cannot be convicted of possession with intent to distribute without expert testimony pertaining to that issue. We reject this contention. The trial court could properly conclude that this 110 pounds of marijuana was not for personal use and that, therefore, some or all would be distributed. Turner v. United States, 396 U.S. 398, 420, 90 S.Ct. 642, 24 L.Ed.2d 610 (1970); United States v. Childs, 463 F.2d 390, 393 (4th Cir.), cert. denied, 409 U.S. 966, 93 S.Ct. 271, 34 L.Ed.2d 232 (1972).

V

Klein claims reversible error because his grand jury proceedings were not recorded. In United States v. Price, 474 F.2d 1223, 1225 (9th Cir. 1973), we held that “in absence of a Government showing that it has a legitimate and compelling interest to be served by nonrecordation,” a district court abuses its discretion by failing to grant a potential defendant’s motion to have the grand jury proceedings recorded. Klein admits that Price applies only where the defendant requests recordation of the grand jury proceedings. Here no such request was made. Since we do not require all grand jury proceedings to be recorded, Loux v. United States, 389 F.2d 911 (9th Cir.), cert. denied, 393 U.S. 867, 89 S.Ct. 151, 21 L.Ed.2d 138 (1968), the failure to record the grand jury testimony in this case was not error.

VI

Klein also urges reversal of his conviction because of the destruction and loss of certain items of evidence. Both the beer box and the marijuana package, each of which had an alleged hole, were destroyed prior to trial by the customs seizure clerk. The government states that because of contraband storage problems in the Southern District of California, the Chief Judge has ordered all but 24 kilo packages may be destroyed in large marijuana seizures. Photographs taken at the checkpoint of the beer box containing the marijuana were admitted into evidence.

Also lost was a report listing the names of persons arrested for contraband offenses at the San Onofre checkpoint during the 90-day period prior to the arrest of Heiden and Klein. Pursuant to a motion, the government had been ordered to prepare this report (which contained the names of persons arrested, the dates of arrest and the amounts of contraband seized) and to submit it to the trial judge in camera. At the joint suppression hearing and trial, the judge announced that the report had been misplaced.

When there is loss or destruction of such evidence, we will reverse a defendant’s conviction if he can show (1) bad faith or connivance on the part of the government or (2) that he was prejudiced by the loss of the evidence. See United States v. Henry, 487 F.2d 912 (9th Cir. 1973). There was no evidence in the record of bad faith or connivance on the part of the government nor can we infer such. There is no evidence that the box and package of marijuana were not inadvertently destroyed by the government agents who were unaware that the exhibits were desired by the defense. The issue, therefore, is whether Heiden and Klein were prejudiced by the unavailability of the evidence.

The evidence which was lost or inadvertently destroyed was not crucial to establishing guilt. Its primary purpose was to attempt to impeach the officers’ credibility at the suppression hearing. The defense evidently sought to show that officers at this checkpoint routinely searched for contraband under the guise of searching for aliens. Presumably, the defense hoped to establish that smelling marijuana was an afterthought used to sustain an otherwise illegal search. But Heiden and Klein have not shown how either the beer box, the marijuana package with a hole in it or the arrest records at San Onofre were crucial to their case.

The need for the list is described as necessary “to more fully ascertain the standard procedure surrounding searches for illegal aliens.” If this report were crucial to the defense, however, we cannot understand why steps were not taken to procure the report prior to trial. It had been ordered three weeks before. By the time of the suppression hearing and trial, which were held together, it was too late to interview the people listed. Indeed, Heiden’s counsel told the judge that “we wouldn’t have time to complete the investigation of the people involved. . . . ” On the other hand, if counsel had an unstated intention to use only the report itself, he has failed to demonstrate how Klein was prejudiced. If the report were as significant as Klein now contends, a motion to continue the suppression hearing until its production would seem to have been an appropriate course of action. That motion was not made.

Klein alleges that the box and marijuana package were necessary to cross-examine the officers effectively. Had the box and marijuana package not been damaged in any way, the credibility of officer Brady’s testimony might have been affected. A photograph of the box, however, shows that one corner was damaged and that through that hole, a corner of a marijuana package could have been exposed. But even assuming that the box and package could have been produced and that agent Brady’s testimony that he saw a damaged corner could have been attacked, such possible evidence does not affect the credibility of agent Batchfelder’s testimony that he smelled the marijuana. We cannot say that Klein was prejudiced by the nonavailability of this evidence. See United States v. Sewar, 468 F.2d 236 (9th Cir. 1972), cert. denied, 410 U.S. 916, 93 S.Ct. 972, 35 L.Ed.2d 278 (1973).

Affirmed.

MERRILL, Circuit Judge, with whom PECKHAM, District Judge,

concurs, concurring:

I concur in Judge Wallace’s opinion but wish to lend emphasis to his warning in footnote 1. Cases will arise where the contraband destroyed does have potential usefulness as evidence not possessed by the sample retained. When this occurs and destruction is shown to have been prejudicial, reversal is called for. I would say that the practice apparently followed in the Southern District invites reversal. I would urge that it be halted; that destruction of evidence follow only after petition and order directed to the particular items to be destroyed, with notice to the defendant and opportunity to petition for access to that which has been seized.

      . The government is flirting with the danger of reversal any time evidence is lost or inadvertently destroyed. When evidence is seized, the government should take every reasonable precaution to preserve it. Saving only 24 kilo bricks from large marijuana seizures is, under ordinary circumstances, neither unreasonable nor illogical. Procedures should be instituted, however, that will prevent the type of destruction of evidence as occurred in this case.
      We, as a court system, accept the same admonition as it pertains to the misplaced list.


source: Caselaw Access Project

author: WILLIAM E. DOYLE, Circuit Judge.

license: Public Domain

text:
    UNITED STATES of America, Plaintiff-Appellee, v. Craig MUNDT, Defendant-Appellant.
    No. 74-1230.
    United States Court of Appeals, Tenth Circuit.
    Argued Nov. 11, 1974.
    Decided Dec. 26, 1974.
    Rehearing Denied Jan. 17, 1975.
    Certiorari Denied April 28, 1975.
    See 95 S.Ct. 1682. '

      Arthur H. Bosworth, Asst. U. S. Atty., Denver, Colo. (James L. Treece, U. S. Atty., Denver, Colo., on the brief), for plaintiff-appellee.
    Natalie S. Ellwood, Denver, Colo., for defendant-appellant.
    Before SETH, BARRETT and DOYLE, Circuit Judges.
   WILLIAM E. DOYLE, Circuit Judge.

This is a companion case of United States v. Smaldone, decided August 14, 1973, 484 F.2d 311 (10th Cir. 1973). As in Smaldone, we are asked to review and reverse a conviction of conspiracy to import cocaine, contrary to 21 U.S.C. §§ 952(a) and 963. The facts are set forth in the Smaldone opinion and are here supplemented insofar as they pertain to the appellant Mundt.

The associations between Mundt, Greenspan, Merkowitz, Smaldone and Nocenti commenced in the spring of 1972. The association was for the importation of cocaine. Unknown .to the others, Nocenti was a government informer. The idea was that Mundt and Greenspan were to buy the cocaine in Peru and Nocenti was to bring it through customs. Merkowitz and Smaldone each contributed about $9,000 to the purchase price.

On May 12 Nocenti traveled to Lima, Peru with Agent Doll. Very soon after arrival he met one Laurence Katz, Special Agent in Charge of the Drug Enforcement Administration office in Lima and who was attached to the American Embassy. Nocenti met Katz several times in Lima. On about May 20 Mundt and Greenspan met Nocenti there. It was arranged on May 27 that the cocaine was to be delivered by Mundt to Nocen-ti. On the night in question the room next to that of Nocenti was being monitored by Katz and several officers of the Peruvian Investigative Police. When Mundt and Nocenti went to the room with the cocaine, the Peruvian officers entered and arrested Mundt. They also went through the motions of arresting Nocenti. They seized the containers of cocaine and took them into the next room where Katz field tested them and determined that it was cocaine. Greenspan was arrested outside the hotel. Katz visited Mundt at the Peruvian Police Headquarters and talked to him. Mundt was confined, and during the next 24 hours one Major Arrarte of the Peruvian Police Force intermittently questioned Mundt. Arrarte was able to speak English and Mundt was not able to speak Spanish. Arrarte took a statement from Mundt and translated it into Spanish. Mundt was tried in Peru and was in a prison there for over a year.

The trial in this case started January 28, 1974 and culminated in a verdict of guilty on January 30. Merkowitz and Smaldone had, of course, been convicted prior to the Mundt trial.

Numerous contentions on behalf of Mundt are made. They are, first, that the trial court erred in failing to suppress Mundt’s statement to Major Ar-rarte in Peru; second, that the court erred in admitting evidence of the delivery of the cocaine to Smaldone. It is said that this occurred after the arrest of defendant and involved actions of third persons.

In addition to the above contentions there are subsidiary points. These include:

A. The trial court’s denial of defendant’s motion for funds to enable an investigator to go to Peru at government expense under the Criminal Justice Act, 18 U.S.C. § 3006A(e).

B. The refusal of the trial court to grant to the defendant an investigator as a deprivation of rights under the Sixth Amendment.

C. Refusal of the court to dismiss the case because the schedules of controlled drugs had not been updated and republished as required by 21 U.S.C. § 812(a).

D. The trial court’s denial of a continuance. It is said that this undermined the preparation of the defense.

E. The failure of the trial court to rule that the chain of evidence was not established. It is contended that on that account the cocaine should have been excluded.

F. The action of the court in receiving photographs. It is said that these were secondary evidence.

I.

WHETHER THE COURT ERRED IN RECEIVING MUNDT’S STATEMENT GIVEN TO OFFICER ARRARTE IN PERU

The officer had received training in the United States and knew about the Miranda warnings but did not give them because under Peruvian law this is not required. It also appears that Mundt requested an attorney but was told that under Peruvian law he was not allowed to have one present during the questioning.

The cases are unanimous in holding that a warning is not essential to the validity of a confession which has been given in a foreign country. See United States v. Chavarria, 443 F.2d 904 (9th Cir. 1971). See also Kilday v. United States, 481 F.2d 655 (5th Cir. 1973); United States v. Welch, 455 F.2d 211 (2d Cir. 1972); United States v. Nagelberg, 434 F.2d 585 (2d Cir. 1970), cert. denied, 401 U.S. 939, 91 S.Ct. 935, 28 L.Ed.2d 219 (1971).

The trial court did find that the statement was voluntarily given, and it also submitted the issue of voluntariness to the jury. Furthermore, there is not evidence to establish or suggest that the statement was involuntary. True, it was taken over a period of 24 hours, but during that time there were no threats or coercion and no deprivation of food, sleep or toilet facilities.

So, therefore, the only question which we need consider is whether the participation by the American authorities was so extensive as to require that the statements be excluded. Defendant’s position is that any participation by American authorities makes the effort a joint venture and renders the Miranda rule applicable. The trial court found that the United States’ preliminary participation through Katz was not sufficient to warrant exclusion of the statement. The judge specifically found that Katz was merely coordinating with the foreign officers and was not at that time seeking evidence for use in an American case. The Katz testimony was that he had helped plan the operation but that General Serango of the Peruvian Police was in ultimate control. Katz did not actually participate in the arrest of Mundt and Greenspan. Katz indeed played a substantial part in the events which led up to the arrest of Mundt, but once the arrest was made the Peruvian Police took over and their investigative efforts led to an independent prosecution. This latter supports the conclusion that these men were not acting as agents for the United States. Clearly they were not mere instruments of United States officials. The test, according to our view, is not whether American officers have played a substantial role in events leading up to the arrest. Nor is the test a question of joint venture as asserted by appellant. This is a vague, indefinite term and is, in our view, unreliable. The trial court found that Katz merely cooperated with the Peruvian Police and this finding is supported by the evidence.

II.

THE QUESTION WHETHER THE EVENTS WHICH OCCURRED AFTER MUNDT’S ARREST WERE ADMISSIBLE

Appellant was arrested in Peru on May 27. Despite the arrest, the cocaine seized was shown at trial to have been carried from Lima, Peru to Denver and delivered to Merkowitz and Smaldone. We here consider the appellant’s objection that the evidence of these events occurring subsequent to his arrest was irrelevant.

It is true that the government moved to strike the overt act allegation, describing these subsequent events, from the Mundt indictment. The court granted this. The government maintains that it was not relying on this overt act to evidence Mundt’s participation in the conspiracy. The court did not strike the testimony which had been offered with respect to the subsequent events. Indeed, defendant did not move to strike this evidence.

Drug agents Doll and Dunne testified with respect to delivery of the cocaine to Smaldone and the cocaine thus seized was received in evidence in order to establish the general conspiracy. It is necessary, of course, to identify the material seized as cocaine.

Merkowitz and Nocenti also testified at the trial concerning these events. Merkowitz described a telephone call with Smaldone in which he notified the latter that Nocenti had arrived. He also testified as to a conversation with No-centi as to Nocenti’s arrival from Peru and he further testified as to a telephone conversation with Nocenti on May 30 saying that the cocaine had arrived. He gave further testimony as to his going to the Sheraton and picking up the cocaine, at which time he was arrested.

Nocenti testified as to his arrival in Denver on the 29th and of his contacting Merkowitz and arranging a meeting, following which the cocaine was delivered to Merkowitz and Merkowitz was arrested. Subsequently, he delivered cocaine to Smaldone who was also arrested.

It would appear from the trial court’s rulings that all of these events which occurred subsequent to appellant’s arrest were received for a limited purpose which was to show that the cocaine had been imported into the United States and had been delivered to Merkowitz and Smaldone. The relevance of this evidence from the standpoint of the appellant was the fact of delivery.

Since the evidence was offered for the limited purpose of showing importation and for the purpose of completing the chain of possession of the evidence and not for the purpose of implicating appellant as a member of the conspiracy, we are unable to find that the reception violated any rule of evidence. Indeed, the trial court charged the jury that

A defendant cannot be held criminally liable for substantive offenses committed by members of a conspiracy before the defendant had joined or after he had withdrawn from the conspiracy.

The effect of this instruction was to advise the jury that the defendant could not be implicated by events which occurred after he had withdrawn from the conspiracy.

The usual objection to testimony subsequent to the termination of the conspiracy as to the accused on trial is concerned with hearsay statements made by one co-conspirator which tend to implicate the co-conspirator with respect to whom the conspiracy has terminated. This was the problem in Krulewitch v. United States, 336 U.S. 440, 69 S.Ct. 716, 93 L.Ed. 790 (1949). See also the discussion and citations in United States v. Mares, 260 F.Supp. 741 (D.Colo.1966), rev’d on other grounds, 383 F.2d 805 (10th Cir. 1967), cert. denied, 394 U.S. 963, 89 S.Ct. 1314, 22 L.Ed.2d 564 (1969).

We recognize the seriousness of the problem of receiving testimonial statements after the termination of the conspiracy. In that circumstance the conspirator uttering the statement is no longer the agent for the person whose part in the conspiracy has ended. But it is not the testimonial problem with which we are here confronted. The evidence as to the events after the arrest of appellant did not consist of testimonial utterances; it did not go to the defendant’s personal involvement. Rather, it tended to establish the general conspiracy. For this purpose it was relevant and admissible. Accordingly, we see no merit in the present contention.

III.

THE SUBSIDIARY POINTS

A. The Denial of Defendant’s Motion to Hire an Investigator.

Defendant’s argument is that the refusal of the court to authorize an investigator to go to Peru constituted a violation of 18 U.S.C. § 3006A(e). The maximum amount authorized is $300.00 for this purpose. To get more it is necessary for the chief judge of the circuit to approve it. Defendant did not make a strong showing as to necessity. He said that an investigator could acquire facts which could support his contention that he had been mistreated by the Peruvian Police, but he was unable to state what he expected specifically to find, and he was unable to show that he had exhausted any other effort except to send the investigator to Peru. Another factor was that it was his desire to send his fiancee on the trip. The court would have allowed the $300.00 had defendant been able to make any showing.

Our court has held that it is essential when requesting investigative services to show specifically the reasons why such services are necessary. See Christian v. United States, 398 F.2d 517 (10th Cir. 1968).

Finally, we see no violation of the Sixth Amendment based on the denial of investigative services. Cf. Christian v. United States, supra, at 519, fn. 7.

B. The Failure to Republish the List of Controlled Substances.

Because the republication of the controlled substances as required by 21 U.S.C. § 812(a) was not carried out exactly within the two-year period, but was about two weeks late, defendant contends that cocaine was not a controlled substance during the time prior to May 12, 1972. He would give no effect to the fact that the republication was stated to be effective April 27, 1972. In any event, it was a controlled substance when the conspiracy was commenced and also during the period that Mundt was in Peru, so we see no merit in this contention whatsoever.

C. The Denial of a Continuance.

On January 24, 1974, a few days before the trial was to commence, defendant moved for a continuance. The court painstakingly heard the reasons advanced and denied the motion for failure to show that tangible evidence helpful to the defendant could be obtained and presented. The matter was peculiarly subject to trial court discretion, and we see no abuse of this discretion. See Ungar v. Sarafite, 376 U.S. 575, 84 S.Ct. 841, 11 L.Ed.2d 921 (1964); United States v. Spoonhunter, 476 F.2d 1050 (10th Cir. 1973).

D. Adequacy of the Chain of Possession.

We have examined this issue and find that, as did the trial court, the evidence was adequate and that there was no proof of tampering. Here again, there was no abuse of discretion on the part of the trial court in receiving the various links.

E. The Receipt of the Copies of Photographs.

The pictures of the articles taken from appellant’s possession by the Peruvian Police were received, and it is contended that the actual articles should have been brought in. Conceding that it is preferable to have the originals, we see no error in receiving the photographs since the actual articles and the original photographs are in the custody of the Peruvian court. It is not argued, however, that these did not depict the objects which they purported to show, and where this is the situation the matter is one of trial court discretion. See United States v. Wagner, 475 F.2d 121 (10th Cir. 1973); United States v. Merrick, 464 F. 2d 1087 (10th Cir.), cert. denied, 409 U.S. 1023, 93 S.Ct. 462, 34 L.Ed.2d 314 (1972); United States v. Ketchum, 445 F.2d 860 (10th Cir. 1971); Wood v. United States, 357 F.2d 425 (10th Cir.), cert. denied, 385 U.S. 866, 87 S.Ct. 129, 17 L.Ed.2d 94 (1966); Hollingsworth v. United States, 321 F.2d 342 (10th Cir. 1963).

The desirability of having the objects rather than photographs cannot be denied, but trials are imperfect and where, as here, the presiding judge has determined that the photographs are accurate and trustworthy, there is little to review.

The judgment is affirmed.

       Cert. Denied, 415 U.S. 915, 94 S.Ct. 1411, 39 L.Ed.2d 469 (1974).

      . Mundt did testify outside the presence of the jury that he had been beaten and threatened, but the court found otherwise.


author: MULLIGAN, Circuit Judge:

text:
    Jerome SIEGEL and Joseph Shuster, Plaintiffs-Appellants, v. NATIONAL PERIODICAL PUBLICATIONS, INC., et al., Defendants-Ap-pellees.
    No. 36, Docket 73-2844.
    United States Court of Appeals, Second Circuit.
    Argued Nov. 7, 1974.
    Decided Dec. 5, 1974.

      Gordon T. King, New York City (Cou-dert Brothers, New York City, Carleton G. Eldridge, Jr., New York City, of counsel), for plaintiffs-appellants.
    Michael D. Hess, New York City (Weil, Gotshal & Manges, New York City, Edward C. Wallace, Heather G. Florence, New York City, of counsel), for defendants-appellees.
    Philip B. Wattenberg, New York City, for Amicus Curiae Music Publishers’ Association of the United States, Inc.
    Irwin Karp, New York City, for Ami-cus Curiae Authors League of America, Inc.
    Before KAUFMAN, Chief Judge, and ANDERSON and MULLIGAN, Circuit Judges.
   MULLIGAN, Circuit Judge:

This is an appeal from the granting of summary judgment dismissing the complaint upon the order of the Hon. Morris E. Lasker, filed on October 18, 1973. While the opinion below, 364 F.Supp. 1032 (S.D.N.Y.1973), sets forth the facts in detail, it will be necessary to repeat some of the more salient factual background.

I

The issue presented is who has the copyright renewal rights in the famous “Superman” cartoon character. In 1933, plaintiff Jerome Siegel conceived the idea of Superman — a person of unprecedented physical prowess dedicated to acts of derring-do in the public interest. In the same year, together with plaintiff Joseph Shuster, he created a Superman comic strip which consisted of several weeks’ worth of material, some of which was completely “inked in” and ready for publication, and some of which consisted of mere black-and-white pencil drawings. The new strip was not published at this time, although plaintiffs continued to collaborate on other strips that were then in publication.

One- of plaintiffs’ customers for these other strips was Detective -Comics, Inc. (Detective), the predecessor in interest of the present defendant National Periodical Publications, Inc. (National). On December 4, 1937 Detective entered into a written employment contract with plaintiffs, whereby the latter would furnish two other strips exclusively to Detective for a period of two years. The plaintiffs further agreed “that all of these products and work done by said Employee [plaintiffs] for said Employer [Detective] during said period of employment, shall be and become the sole and exclusive property of the Employer, and the Employer shall be deemed the sole creator thereof, the Employee acting entirely as the Employer’s employee.” The agreement also gave Detective the right of first refusal for any new strips the plaintiffs might produce.

In 1938, for the first time, plaintiffs submitted their 1933 Superman materials to Detective to be considered for use in a new magazine, Action Comics. Detective asked plaintiffs to revise and expand the materials into a full-length production suitable for magazine publication, and this was done.

Thereafter, and prior to the first appearance of Superman in Action Comics, Detective prepared a written release, dated 1 March 1938, which was executed by plaintiffs and accepted by Detective. This release sold and transferred to Detective “such work and strip [Superman], all good will attached thereto and exclusive rights to the use of the characters and story, continuity and title of strip contained therein, to you [Detective] and your assigns to have and hold forever and to be your exclusive property. The intent hereof is to give you exclusive right to use and acknowledge that you own said characters or story and the use thereof exclusively

On 19 December 1939, a supplemental employment agreement was entered into. It raised plaintiffs’ compensation for the increasingly popular Superman strip, and in addition contained the following language:

That we, Detective Comics, Inc., are the sole and exclusive owners of the comic strip entitled “Superman” . and to [sic] all rights of reproduction of all said comic strips and the titles and characters contained therein, and the continuity thereof, including but not limited to the fields of magazine or other book publication, newspaper syndication . . . and all other form of reproduction. We have all right of copyright and all rights to secure copyright registration in respect of all such forms of reproduction.

No further written agreements between the parties were ever executed, although plaintiffs were paid compensation at ever-increasing rates. By 1947, plaintiffs’ total compensation for the strip exceeded $400,000.

In that year plaintiffs instituted an action against defendant National in the New York State Supreme Court, West-chester County, to annul the contracts between the parties for various reasons. The March 1938 agreement was specifically attacked as void for lack of mutuality and consideration. In addition, plaintiffs asked for a declaration of the rights of the parties in the Superman character.

Referee J. Addison Young, in an opinion dated 21 November 1947, concluded that the March 1938 agreement was valid and that it transferred to Detective “all of plaintiffs’ rights to Superman” (emphasis added). Shortly thereafter, on 12 April 1948, the referee signed findings of fact and conclusions of law. The first such conclusion stated:

1. By virtue of the instrument of March 1, 1938, plaintiffs transferred to Detective Comics, Inc. all of their rights in and to the comic strip Superman including the title, names, characters and concept . . . and by virtue of said instrument Detective Comics, Inc. became the absolute owner of the comic strip Superman ....

On 19 May 1948 the parties signed a stipulation which called for the payment of certain moneys by National to plaintiffs. In addition the stipulation repeated the above-quoted conclusion of law, and also stated that:

Defendant National Comics Publications, Inc. is the sole and exclusive owner of and has the sole and exclusive right to the use of the title Superman and to the conception, idea, continuity, pictorial representation and formula of the cartoon feature Superman as heretofore portrayed and published and such sole and exclusive ownership includes, but is not limited to, the fields of book and magazine publications, [etc.] and all other forms of reproduction and presentation, whether now in existence or that may hereafter be created, together with the absolute right to license, sell, transfer or otherwise dispose of said rights.

The final consent judgment filed by the referee on 21 May 1948 incorporated the above stipulation and further

Declared and Adjudged that by virtue of the instrument of March 1, 1938, plaintiffs validly transferred to Detective Comics, Inc. ... all of their rights in and to the comic strip Superman . . . and that by virtue of said instrument, said Detective Comics, Inc. became the absolute owner of the comic strip Superman . . . and it is further
Declared and Adjudged that defendant National Comics Publications, Inc. is the sole and exclusive owner of and has the sole and exclusive right to the use of the title . . . and cartoon feature Superman and it is further
Ordered and Adjudged that plaintiffs ... be and they hereby are enjoined and restrained from creating, publishing, selling or distributing any material of the nature heretofore created, produced or published under the title Superman .

Plaintiffs now seek a declaration that they, and not defendant National, own the copyright renewal rights to the Superman strip. National counterclaims for a similar declaration in its favor. It is stipulated that both parties made timely renewal filings with the Register of Copyright.

The court below granted defendants summary judgment dismissing the complaint, primarily for three reasons:

1) The 1947 Westchester action bars relitigation of questions concerning the rights of the parties in Superman, because of res judicata;

2) Superman was a “work for hire” within the meaning of the Copyright Act, 17 U.S.C. § 26 (Supp.1974), and therefore the renewal rights are in the employer;

3) the various agreements between the parties consistently manifested an intention to give to Detective all of plaintiffs’ rights in Superman, including the right of renewal of copyright, though it was never mentioned expressly in any of the agreements.

II

We are persuaded here that the court below properly decided that the state court judgment of May 21st, 1948 effectively estopped the plaintiffs from relitigating the issue of the ownership of the renewal copyright. In the state action the present plaintiffs sought, inter alia, a declaratory judgment with respect to the rights of the parties in Superman. After a trial the official referee rendered an opinion as well as detailed findings of fact and conclusions of law. An interlocutory judgment was entered on April 12, 1948 and notices of appeal were filed by both parties. Settlement negotiations then ensued which resulted in a stipulation of settlement and the entry of a final consent judgment of May 21st, 1948. No appeals were taken, and no question has been raised as to the validity of the judgment. There is no doubt that the judgment of the state court is binding in this subsequent federal action. See Vernitron Corp. v. Benjamin, 440 F.2d 105, 108 (2d Cir.), cert. denied, 402 U.S. 987, 91 S.Ct. 1664, 29 L.Ed.2d 154 (1971).

It is equally clear that a consent judgment does have res judicata effect, Stuyvesant Insurance Co. v. Dean Construction Co., 254 F.Supp. 102, 110 (S.D.N.Y.1966), aff’d sub nom. Stuyvesant Ins. Co. v. Kelly, 382 F.2d 991 (2d Cir. 1967); 1B J. Moore, supra, If 0.409 [5]; see United States v. Swift & Co., 286 U.S. 106, 115, 52 S.Ct. 460, 76 L.Ed. 999 (1932).

The only issue before us is whether the state judgment actually determined whether the copyright renewal rights to Superman were vested in the defendants here. While it is true that the term “renewal copyright rights” was not mentioned in the state court judgment, we are persuaded that the state court action finally determined that Detective, predecessor in interest to National, owned all rights to Superman without limitation.

The injunction in the 1948 decree, which enjoined the plaintiffs from publishing Superman, is not limited to the copyright period or what remained thereof but is perpetual. The plaintiffs were represented by counsel in the state court and there is no limiting language in the judgment which would support the present contention that renewal rights were preserved. On the contrary, a reading of the judgment and the findings inescapably leads to the conclusion that the decree settled for once and for all that the defendants had all right and title to Superman for all time.

Appellants argue that the agreements did not convey the renewal rights because, as a rule, a general transfer of an original copyright without mention of renewal rights does not convey the latter without proof of a contrary intention. Edward B. Marks Music Corp. v. Charles K. Harris Music Publishing Co., 255 F.2d 518, 521 (2d Cir.), cert. denied, 358 U.S. 831, 79 S.Ct. 51, 3 L.Ed.2d 69 (1958). The ready answer to this argument is that the state court action determined that the agreements conveyed all of the plaintiffs’ rights in Superman to the defendants and not just the original copyright term. Under the doctrine of res judicata we are not free collaterally to re-examine the agreements to determine whether or not the construction placed upon them was warranted. Restatement of Judgments § 48, comment a; IB Moore, supra, 1f 0.405 [1], at 629.

We also should point out that in Venus Music Corp. v. Mills Music, Inc., 261 F.2d 577 (2d Cir. 1958) this court held that general words of assignment can include renewal rights if the parties had so intended. • Accord, cases cited in Annot., 2 A.L.R.3d 1403, 1415-16 (1965). That intent is to be determined by the trier of the facts. Here the March 1938 agreement between the parties did not simply purport to convey a copyright; in fact, the term is not mentioned in that agreement. Rather, the sale of the Superman strip conveyed the “exclusive right to the use of the characters and story, continuity and title of [the] strip to you and your assigns to have and hold forever” (emphasis added). Moreover, the authors agreed not to “employ said characters or said story or sell any like strip or story at any time hereafter to any other person, firm or corporation . ” (emphasis added).

' The state court was called upon to construe these instruments and the determination of that court that the plaintiffs intended to convey all their rights, including implicitly the renewal of the copyright, was, in our view, entirely proper. In any event, that decision is binding on us here.

Ill

The court below held that Superman was also a “work for hire” within the meaning of the Copyright Act, 17 U.S.C. § 26; since this conclusion was based upon the fact findings of the state court, the court below further concluded that res judicata would bar the plaintiffs from relitigating the factual basis of the “work for hire” point. We disagree. While it is evident that the state court concluded as a matter of law that the plaintiffs conveyed all their rights in Superman to the defendants, there was no conclusion of law in the state court that the comic strip was a work for hire so as to create the presumption that the employer was the author. That issue was not litigated at all in the state court. On the contrary, that court’s finding of fact no. 8 was that the plaintiffs were “the originators and authors of the cartoon character Superman and of the title Superman and first created cartoon material in which the said character and title first appeared in 1934. . . . ” The court below instead relied upon finding of fact no. 22 in which the state court found that the plaintiffs did revise and expand the Superman material at the request of the defendants and that this revised material constituted the formula for the ensuing series of strips. We do not consider this tantamount to a conclusion that Superman was a work for hire. That doctrine is applicable only when the employee’s work is produced at the instance and expense of the employer, Brattleboro Publishing Co. v. Winmill Publishing Corp., 369 F.2d 565, 567 (2d Cir. 1966), or, in other words, when the “ ‘motivating factor in producing the work was the employer who induced the creation . . . Picture Music, Inc. v. Bourne, Inc., 457 F.2d 1213, 1216 (2d Cir.), cert. denied, 409 U.S. 997, 93 S.Ct. 320, 34 L.Ed.2d 262 (1972). Superman had been spawned by the plaintiffs four years before the relationship between his authors and the defendants existed. We consider Scherr v. Universal Match Corp., 417 F.2d 497 (2d Cir. 1969), cert. denied, 397 U.S. 936, 90 S.Ct. 845, 25 L.Ed.2d 116 (1970), cited below, to be distinguishable. In that case two servicemen had created a small clay model of an infantryman. Their Army superiors directed them thereafter to sculp a statue 25 feet high with a 12 foot figure of a charging infantryman; the court found this larger creation to differ from the model. The copyright was held to be the property of the United States under the work for hire doctrine. In the case before us Superman and his miraculous powers were completely developed long before the employment relationship was instituted. The record indicates that the revisions directed by the defendants were simply to accommodate Superman to a magazine format. We do not consider this sufficient to create the presumption that the strip was a work for hire.

Accordingly, we affirm the dismissal of the complaint, but only on the ground that the 1947 state court action, in interpreting the agreements between the parties, precludes the plaintiffs from contesting ever again that all rights in Superman, including the renewal copyright, have passed forever to defendants.

      . The parties on this appeal have used the terms “res judicata” and “collateral estoppel” interchangeably. The distinction depends upon whether or not the former judgment was rendered on the same cause of action (res judicata) or on a different cause of action (collateral estoppel). IB J. Moore, Federal Practice II 0.44X [2] (2d ed. 1974); Restatement of Judgments § 68, comment a (1942). Since we hold that the state judgment action determined that the defendants owned all of the rights to the Superman strip without reservation, the doctrine of res judicata is properly applicable.


author: ELY, Circuit Judge:

text:
    Arne THIRUP and Pauline Thirup, Appellants, v. COMMISSIONER OF INTERNAL REVENUE, Appellee.
    No. 73-2351.
    United States Court of Appeals, Ninth Circuit.
    Dec. 23, 1974.

      George E. Link, Thelen, Marrin, Johnson & Bridges, San Francisco, Cal., for appellants.
    Scott P. Crampton, Asst. Atty. Gen., Tax Div., U. S. Dept, of Justice, Washington, D. C., for appellee.
    Before ELY and WALLACE, Circuit Judges, and JAMESON, Senior District Judge.

       Honorable William J. Jameson, District of Montana, sitting by designation.

   OPINION

ELY, Circuit Judge:

This is a tax case in which Arne and Pauline Thirup, the appellants, claim a $4,755.41 tax credit pursuant to section 38 of the Internal Revenue Code for investments in greenhouses used in their business of growing and selling cut flowers. After concluding that the greenhouses were “buildings” as that term is used in section 48 of the Code, and therefore ineligible for the investment tax credit, the Commissioner of Internal Revenue disallowed the Thirups’ claimed credit, and the Tax Court upheld the Commissioner’s decision. Arne Thirup, 59 T.C. 122 (1972). We reverse.

During 1966, the year for which their tax liability is in dispute, the Thirups conducted their flower business through a sole proprietorship known as Pajaro Valley Greenhouses [hereinafter, “Pajaro Valley” ]. Pajaro Valley’s greenhouses were located near Watsonville, California, but the business sold its cut flowers, mainly roses and carnations, throughout the United States.

In 1966, the appellants spent $79,-841.39 to build one new greenhouse (the “principal” greenhouse) and to improve several existing greenhouses by replacing, with more durable fiber glass, the polyethylene plastic that had previously formed their sides and roofs. The principal greenhouse was a completely enclosed rectangular structure, 400 feet long and 200 feet wide. Its sides and walls were sheets of corrugated fiber glass attached with special nails to a wooden frame consisting of large beams set vertically into the ground and topped with an A-shaped frame roof of lighter wood. The structure had no floor, and the appellants’ flowers grew directly from the soil enclosed by the greenhouse. Panes of flat fiber glass, set on metal hinges and framed in wood, formed rows of windows at the top of the structure.

The taxpayers designed and equipped their greenhouses to provide a total interior environment for the commercial production of flowers. The greenhouses shielded the growing plants from the outside elements, but they also did more. Their translucent fiber glass walls, windows, and roofs diffused the sunlight that fell on the flowers so that the flower stems would not bend directly toward the sun but instead would grow long and straight for the commercial market. The greenhouses were equipped with automatic temperature control systems so that when the temperature inside the structures rose above a fixed level, electric motors opened the windows to the outside. If the temperature became too cool, automatic valves in steam pipes located at different levels inside the structures opened to admit heat. Other pipes in the greenhouses carried water and liquid fertilizer to the plants, and generating devices located in each greenhouse released small amounts of carbon dioxide into the interior air. Beneath the greenhouses’ soil floors were systems of steam pipes which the appellants periodically opened to sterilize the growing area.

The roses and carnations growing inside Pajaro Valley’s greenhouses required a substantial amount of human care. Before young plants w;ere set into the greenhouse floors, it was necessary for employees to turn and fertilize the soil and mix it with beneficial additives. After the plants had begun to bloom, workers harvested the carnations once, and the roses twice, each day. In addition, the workers routinely moved through the greenhouses to pull weeds, spray chemicals, prune the plants, adjust plant supports, or perform other, similar, tasks.

Pajaro Valley employed from 20 to 25 workers in 1966, at least half of whom spent most of each workday harvesting and caring for the plants inside the greenhouses. The Tax Court found that the greenhouse workers sometimes remained inside the greenhouses for lunch and work breaks, and that during these breaks the workers often rested on tables, benches, and boxes that had been placed in the aisles between flowerbeds and along the greenhouse walls for storing tools and affording workers access to the tops of tall plants. Pajaro Valley’s other employees normally worked at tasks outside the greenhouses, but during peak seasons some of the “outside” employees were assigned “inside” work. The Tax Court found that the appellants’ employees spent approximately half of their aggregate working time inside the greenhouses.

Section 48 of the Internal Revenue Code defines the types of property eligible for the investment tax credit (known as “section 38 property”):

Sec. 48. (a) Section 38 Property—
(1) In General. — Except as provided in this subsection, the term “section 38 property” means—
(A) tangible personal property, or
(B) other tangible property (not including a building and its structural components) but only if such property—
(i) is used as an integral part of manufacturing, production, or extraction . . ., or
(ii) constitutes a research or storage facility used in connection with any of the activities referred to in clause (i), .. [Emphasis added].

Here, the Commissioner agrees that the greenhouses are “other tangible property” under subsection 48(a)(1)(B) and that the greenhouses are “used as an integral part of . production . ” under subsection 48(a)(l)(B)(i). The only dispute between the parties is whether the greenhouses are “buildings,” which the parenthetical part of subsection 48(a)(1)(B) declares ineligible for the investment tax credit.

Exercising the authority granted him by section 38(b) of the Internal Revenue Code, the Commissioner has defined the term “building” as the term is used in section 48:

Treas. Reg. § 1.48 — 1(e). Definition of building and structural components.
(1) Buildings and structural components thereof do not qualify as section 38 property. The term “building” generally means any structure or edifice enclosing a space within its walls, and usually covered by a roof, the purpose of which is, for example, to provide shelter or housing, or to provide working, office, parking, display, or sales space. The term includes, for example, structures such as apartment houses, factory and office buildings, warehouses, barns, garages, railway or bus stations, and stores. Such term includes any such structure constructed by, or for, a lessee even if such structure must be removed, or ownership of such structure reverts to the lessor, at the termination of the lease. Such term does not include (i) a structure which is essentially an item of machinery or equipment, or (ii) a structure which houses property used as an integral part of an activity specified in section 48(a)(l)(B)(i) if the use of the structure is so closely related to the use of such property that the structure clearly can be expected to be replaced when the property it initially houses is replaced. Factors which indicate that a structure is closely related to the use of the property it houses include the fact that the structure is specifically designed to provide for the stress and other demands of such property and the fact that the structure could' not be economically used for other purposes. Thus, the term “building” does not include such structures as oil and gas storage tanks, grain storage bins, silos, fractionating towers, blast furnaces, basic oxygen furnaces, coke ovens, brick kilns, and coal tipples.

In holding that the appellants’ greenhouses were “buildings,” the Tax Court relied on the reasoning set forth in Sun-nyside Nurseries, 59 T.C. 113 (1972), which was a companion case to Thirup and which also involved greenhouses. In Sunnyside, the Court applied two tests in deciding that the greenhouses were “buildings” within section 48.

The first test merely involved consideration of the outward appearance of the structures: since the greenhouses looked like buildings, they must be “buildings.” This test, which can be called the appearance test, is attractively simple, and it draws some support from the following sentence from the Commissioner’s definition: “The term ‘building’ generally means any structure or edifice enclosing a space within its walls, and usually covered by a roof . . . .” Treas. Reg. § 1.48-l(e)(l). The quoted statement appears in substantially the same form in both of the Congressional committee reports on the investment tax credit. H.R.Rep.No.1447, 87th Cong., 2d Sess. A18 (1962) (1962-3 Cum. Bull. 405, 516); S.Rep.No.1881, 87th Cong., 2d Sess. 154 (1962) (1962-3 Cum. Bull. 707, 858).

Considering the Congressional history as a whole, however, it is hardly deniable that the intent of Congress in its creation of the investment tax credit was to encourage improvements in the quality and quantity of American industrial products. We think that the appearance test is too imprecise to achieve this Congressional purpose. We note that the other courts that recently have considered the appearance test also have rejected it. See Brown-Forman Distillers Corp. v. United States, 499 F.2d 1263, 1271-1272 (Ct.Cl. 1974) (large, warehouselike structures designed to control temperature and humidity for the proper aging of bourbon whiskey are not “buildings”); Melvin Satrum, 62 T.C. 413 (1974) (reviewed by the full Court) (structures specially designed to provide a beneficial environment for chickens in a commercial egg-producing business are not “buildings,” despite two dissenting opinions emphasizing, inter alia, the structures’ appearance). The Commissioner himself has also declined, on occasion, to apply the appearance test. See, e. g., Rev.Rul. 359, 1971-2 Cum. Bull. 62 (a facility for the bulk storage of peanuts is not a “building,” even though it looks like a building); Rev.Rul. 132, 1968 — 1 Cum. Bull. 14 (same decision for a facility for the bulk storage of potatoes).

The second Sunnyside Nurseries test for determining whether a structure is a “building” within section 48, that of the structure’s function or use, derives from another portion of section 1.48 — 1(e)(1) of the Treasury Regulations: “The term ‘building’ generally means any structure or edifice . . . the purpose of which is, for example, to provide shelter or housing, or to provide working, office, parking, display or sales space.” This statement, too, appears in substantially the same form in the Congressional committee reports. H.R.Rep.No.1447, 87th Cong., 2d Sess. A18 (1962) (1962-3 Cum. Bull. 405, 516); S.Rep.No.1881, 87th Cong., 2d Sess. 154 (1962) (1962 — 3 Cum. Bull. 707, 858).

The Tax Court has written that the quoted portion of section 1.48 — 1(e)(1) establishes

a functional test which limits slightly the broad scope of our common understanding of “building.” Thus, under section 1.48 — 1(e)(1) . ., the basic definition of “building” is a structure with walls and a roof, but a “building,” it is declared, typically provides space for certain purposes. The enumerated purposes . . . are the furnishing of shelter or housing, or of working, office, parking, display, or sales space. These purposes are exemplary and not all inclusive. But . the definition of “building” [is] limited somewhat to the functions just stated'

Robert E. Catron, 50 T.C. 306, 311 (1968) (reviewed by the full Court) (a specialized facility used solely for cold storage of apples is not a “building”). Under the functional test, therefore, the “buildings” that are excluded by the parenthetical part of section 48(a)(1)(B) are structures that provide shelter or housing or furnish working, office, parking, display, or sales space, or exist for another purpose that could be listed with the enumerated purposes without violating the constraining rule of ejusdem generis.

Abandoning the appearance test, the most recent authorities have adopted the functional test. See, e. g., Brown-Forman Distillers Corp. v. United States, 499 F.2d 1263 (Ct.Cl. 1974); Melvin Satrum, 62 T.C. 413 (1974) (reviewed by the full Court). We thoroughly agree with this more recent approach. The functional test carves out those types of general purpose buildings, such as “apartment houses, factory and office buildings, warehouses, barns, garages, railway or bus stations, and stores,” Treas. Reg. § 1.48 — 1(e)(1), that we think Congress intended to exclude from the investment tax credit. But the test preserves for the credit those specialized structures whose utility is principally and primarily a significantly contributive factor in the actual manufacturing or production of the product itself.

Applying a functional test, the Tax Court found in Thirup, and in Sunnyside Nurseries, that the amount of employee activity taking place inside the greenhouses indicated that the greenhouses provided working space, one of the enumerated functions of a “building.” In Brown-Forman Distillers, supra, and Sat-rum, supra, the courts distinguished Sun-nyside Nurseries on the ground that Sunnyside’s employees spent more time inside the greenhouses than, respectively, Brown-Forman’s employees spent inside the whiskey warehouses or Satrum’s workers spent in the chicken coops.

We find the distinction based on the amount of human activity unpersuasive. The proper inquiry, which goes to the nature of the employee activity inside the structures, is “whether the structures provide working space for employees that is more than merely incidental to the principal function or use of the structure.” Brown-Forman Distillers Corp. v. United States, 499 F.2d 1263, 1271 (Ct.Cl. 1974). See Robert E. Catron, 50 T.C. 306, 316 (1968) (reviewed by the full Court).

In Satrum, supra, employees worked in aisles between the rows of chicken cages- inside the structures to collect eggs, feed chickens, and remove droppings. Workers also spent long periods of time inside the structures removing thousands of chickens that were to be sent to market and replacing those chickens with younger birds. The Tax Court characterized these activities as “merely supportive of, and ancillary to,” the purpose of the chickens and expressly found that the structures did not provide working space. 62 T.C. at 417. In our judgment, the activities of the Thirups’ greenhouse employees were, without doubt, of the same supportive and ancillary nature as the activities of the workers in Satrum. That flowers may require more human care than chickens is not a sufficient reason for deciding that greenhouses are “buildings” while chicken coops are not.

We conclude that under the functional test, the Thirups’ greenhouses do not function as “buildings,” as that term is employed in section 48. The greenhouses supply the controlled environment that is essential to the commercial production of more and finer cut flowers, a function neither enumerated in Treasury Regulation § 1.48 — 1(e)(1) nor sufficiently similar to the enumerated functions to be within their scope.

The decision of the Tax Court is

Reversed.

      . The Tax Court found that the Thirups’ greenhouses might be used to grow other varieties of plants but that they are not economically adaptable to any other purposes. 59 T.C. at 123.

      . For the investment credit to be allowed on 100 percent of the cost of “section 38 property,” section 46(c)(2) of the Internal Revenue Code requires that the useful life of the property be 8 years or more. For the purposes of the investment credit and this litigation only, the parties have stipulated that the useful life of the greenhouse components will be 8 years or more.

      . Sunnyside Nurseries was appealed to our court, but the appeal was dismissed because of the appellant’s failure to prosecute his case.

      . The only employee activity inside the Thir-ups’ greenhouses that was not supportive to the flowers was the workers’ lunch and coffee breaks. We think that activity to be insignificant. There was no lunchroom or other specialized area inside the greenhouses for the breaks, and the workers rested and ate their lunch in the aisles near their work only for their own convenience. ' We note that Sunny-side Nurseries presented a somewhat different situation than that with which we are here concerned. There the Tax Court found that workers inside the greenhouses wrapped the pots in which plants were growing in decorative foil and then packed the potted plants into boxes for shipment. 59 T.C. 117-118. We express no opinion as to whether that additional activity justifies the Tax Court’s Sunnyside Nurseries decision.

      . In this regard we agree with the dissenting judges in Satrum who believed that the human activity inside the chicken coops was comparable to the human activity inside the greenhouses in Thirup and Sunnyside Nurseries. Melvin Satrum, 62 T.C. 413, 418-419 (1974) (dissenting opinion of Dawson J., joined by Raum and Drennen, JJ.). (Judge Raum wrote the Tax Court’s opinions in Thir-up and Sunnyside Nurseries.)


author: SNEED, Circuit Judge:

text:
    Theodore WATKINS and Vivian Watkins, Appellants, v. William B. GROVER et al., Appellees.
    No. 73-2127.
    United States Court of Appeals, Ninth Circuit.
    Dec. 26, 1974.
    Theodore Watkins (argued), in pro. per.
    Philip M. Arnot (argued), Eureka, Cal., for appellees.

      Before CHOY and SNEED, Circuit Judges, and BEEKS, District Judge.

       Honorable William T. Beeks, United States District Judge, Western District of Washington, sitting by designation.

   OPINION

SNEED, Circuit Judge:

This is an appeal from a dismissal with prejudice of a suit brought by appellant alleging forcible entry. Since two of the four defendants in the original action were federal court officers, the entire case was removed (pursuant to 28 U.S.C. § 1442(a)(3) ), from the California Superior Court in which it was filed, and dismissed as to the federal defendants by the district court on the ground that they were immune from liability. Thereafter, based upon an assumption that it had no jurisdiction to hear the state claims against the remaining defendants unless independent grounds for federal jurisdiction could be shown, the district court dismissed the case with prejudice. The court’s assumption, however, was incorrect. The modern rule (and the law of this circuit) is that a federal court does have the power to hear claims that would not be independently removable even after the basis for removal jurisdiction is dropped from the proceedings. Murphy v. Kodz, 351 F.2d 163, 167 (9th Cir. 1965). See also Brough v. United Steelworkers of America, AFL-CIO, 437 F.2d 748, 750 (1st Cir. 1971); Rotermund v. United States Steel Corp., 346 F.Supp. 69, 76 (E.D.Mo.1972), aff’d, 474 F.2d 1139 (8th Cir. 1973); Gamage v. Peal, 217 F.Supp. 384, 390-391 (N.D.Cal.1962).

Appellees emphasize that the appeal was taken from the order of dismissal and not from the denial of appellant’s motion to remand, the implication being that this court cannot thereby order the district court to remand the case to the state court. Even if this contention were correct, and notwithstanding Rule 46 of the Federal Rules of Civil Procedure requiring a party to make known to the court his grounds for objection, an appellate court may still note a “fundamental error” not raised below. See Sibbach v. Wilson & Co., 312 U.S. 1, 61 S.Ct. 422, 85 L.Ed. 479 (1941). Such an error exists here.

The dismissal of the suit by the district court is thereby reversed and remanded. On remand, the district court should decide whether to hear the suit on its merits or, in its discretion, to remand the suit to the state court from which it was removed.

Reversed and remanded.

      . Although the record does not indicate on what grounds the joined claims against the non-federal defendants were removed, it is reasonable to assume that the entire suit was removed pursuant to 28 U.S.C. § 1441(c).

      . Appellant’s sole argument in opposition to the motion to dismiss was that the court had diversity jurisdiction.


author: MARIS, Circuit Judge.

text:
    CHICAGO AREA MILITARY PROJECT et al., Plaintiffs-Appellees, v. CITY OF CHICAGO et al., Defendants-Appellants.
    No. 74-1475.
    United States Court of Appeals, Seventh Circuit.
    Argued Nov. 6, 1974.
    Decided Jan. 8, 1975.
    As Amended Feb. 4, 1975.

      Richard L. Curry, Corp. Counsel, Richard F. Friedman, Asst. Corp. Counsel, Chicago, 111., for defendants-appellants.
    Edward T. Stein, Chicago, 111., for plaintiffs-appellees.
    Before SWYGERT, Chief Judge, and MARIS  and CUMMINGS, Circuit Judges.

       Of the Third Circuit, sitting by designation.

   MARIS, Circuit Judge.

This is an appeal by the defendants from an order of the district court enjoining them from preventing the plaintiffs from distributing literature to servicemen and the general public in the terminal buildings at O’Hare Airport, Chicago, except as to the areas immediately leading to the arrival and departure gates.

The plaintiffs, the Chicago Area Military Project, an unincorporated nonprofit organization located in Chicago and known as CAMP, and four of its members and associates brought the suit against the defendants, the City of Chicago and the Mayor, Superintendent of Police, and Commissioner of the Department of Aviation, of the City, claiming that actions by the defendants and their agents and employees in prohibiting the plaintiffs from passing out literature within the terminal buildings at O’Hare Airport deprived them of the rights of free speech, free press, and peaceable assembly guaranteed them by the federal constitution. The plaintiffs’ complaint sought an injunction restraining the defendants from further depriving them of these rights and a declaration that the defendants’ practice and acts were in violation of the Constitution and that their own conduct in distributing literature was protected by the First and Fourteenth Amendments. An amended complaint was filed including a second count, claiming damages, which is not involved in this appeal.

The district court granted a temporary restraining order. Subsequently a preliminary injunction was issued which on appeal this court vacated for failure of the district court to state its findings of fact and conclusions of law as required by Rule 52(a) of the Rules of Civil Procedure and because the injunction lacked the specificity required by Rule 65(d). 492 F.2d 1246. In response to our mandate the district court thereafter stated findings of fact and conclusions of law and entered an order enjoining the defendants and their agents and employees from “obstructing plaintiffs engaged in leafletting or otherwise distributing CAMP NEWS or other literature within the terminal buildings (not to include the ‘fingers’ leading to the arrival and departure gates) of O’Hare Field Airport.” This order has been treated by the parties as a permanent injunction and we shall so regard it. From the order granting this injunction the defendants took the appeal now before us.

It appears that the plaintiff CAMP publishes a monthly newspaper called CAMP News (News of the GI Movement) which is primarily directed to members of the military forces but is also distributed to the general public. It carries news of the “GI Movement”, news of recent legal and political developments pertinent to military personnel and news of a general nature. One of the methods used to disseminate CAMP News is to hand out free copies at O’Hare Airport to individuals, particularly servicemen, who desire to receive them.

O’Hare Airport, located within the limits of the City of Chicago, is owned by the City and administered by the City’s Department of Aviation. It is a two-or-three-minute drive from the nearest residential area, a thirty-minute drive from the Chicago downtown area. with which it is connected by major expressways and is served by bus lines and taxicabs. Private automobiles are accommodated in massive public parking lots. Leased space in the airport terminal buildings houses numerous concessionaires including restaurants and shops of every description. Seventy-two departure gates handle more than 100 flights per hour during peak periods. Approximately 20,000 persons are employed at the airport and a total of 100,-000,000 passengers, persons accompanying them, and employees, use the facility each year. The district court found as a fact that large numbers of persons in the military service use the airport, many without ever leaving the terminal buildings, merely changing flights there for other locations.

At 6:00 p. m. on Sunday, March 11, 1973 Truman Walker, an associate of CAMP, and Steve Romanowski, a member, commenced distributing CAMP News to servicemen in one of the O’Hare Airport terminal buildings in the general area of the check-in counters but somewhat removed from the lines of persons waiting to be served at the counters. They did not approach anyone in a line. Approximately an hour later they were told by a plain-clothes policeman and subsequently by a uniformed Chicago police officer that leafletting was not permitted and that if they persisted in their activity, they would be arrested. The two then informed five other leafletters who were distributing the newspaper in the waiting areas in other terminal buildings what had transpired and all left the airport. One of the plaintiffs testified that he stopped leafletting because his family responsibilities were such that he could not afford being arrested.

The municipal regulation, admittedly unwritten, which the defendants enforced against the plaintiffs had been in existence since before the opening of the present terminal buildings at O’Hare Airport. It appears that it was orally promulgated by the Director of Airports of the City prior to June 1, 1956 and, in the words of the Director, it provided in substance that

“no person shall be permitted to picket, sell anything (except for authorized concessionaires or lessees, and they only at assigned spaces) distribute literature of any nature, or solicit or collect contributions within any building at any airport operated by the City of Chicago.”

The defendants assert that this oral regulation was promulgated under the authority of sections 8.2 — 2 and 37-4 of the Municipal Code of the City of Chicago and of the prior ordinances codified in those sections, and that it is enforceable under section 193-1.4(b) of the Code. Section 193-1.4 is in pertinent part as follows:

“193-1.4. A person commits trespass when he knowingly:
(b) Remains upon the property, or any part thereof, of another after receiving notice, either oral or written, from the owner or occupant to depart; or
(c) Enters upon property open to the public, or any part thereof, and remains thereon with a malicious and mischievous intent after receiving notice, either oral or written, from the owner or occupant to depart.
Any person convicted of trespass shall be fined not less than $5.00 nor more than $500.00.”

However, in the view which we take of the case it becomes unnecessary for us to consider the question whether the Municipal Code does authorize the promulgation and enforcement of such an oral regulation as the one upon which the defendants here rely.

The First Amendment to the Constitution proscribes federal action which abridges an individual’s right to freedom of speech, press and assembly and it has long been settled that the Fourteenth Amendment extends these First Amendment proscriptions to state action. De Jonge v. Oregon, 1937, 299 U.S. 353, 57 S.Ct. 255, 81 L.Ed. 278. One of the primary reasons for the adoption of the First Amendment was to ensure the right to distribute copies of one’s own publication in public places. Near v. Minnesota, 1931, 283 U.S. 697, 716-717, 51 S.Ct. 625, 75 L.Ed. 1357, Lovell v. City of Griffin, 1938, 303 U.S. 444, 451-452, 58 S.Ct. 666, 82 L.Ed. 949. In Schneider v. State, 1939, 308 U.S. 147, 162, 60 S.Ct. 146, 84 L.Ed. 155, the Supreme Court, deciding that the evil of the littering of its streets was not a sufficiently grave reason for a city to ban all leafletting, pointed out that in such a situation the evil required to be regulated was, in fact, the act of littering not the activity of leafletting. While not contesting these basic constitutional principles, the defendants strongly urge that the terminal buildings at the O’Hare Airport, because of the limited purpose which they serve, are not public places of the kind in which unrestricted leafletting must be permitted. In considering this contention we lay aside for the moment the question whether leaf-letting may be restricted in those particular areas, if any, in the terminal buildings where unrestricted leafletting might substantially interfere with airport operations.

In support of their contention that the terminal buildings at O’Hare Airport are not public places where the restriction of leafletting is constitutionally prohibited the defendants make a number of arguments. They assert that public ownership of the airport is not determinative of the question of the plaintiffs’ protection under the First Amendment, citing Marsh v. Alabama, 1946, 326 U.S. 501, 66 S.Ct. 276, 90 L.Ed. 265. They claim that only a limited invitation is extended to the public to use the airport and that this is determinative, citing Lloyd Corp. v. Tanner, 1972, 407 U.S. 551, 92 S.Ct. 2219, 33 L.Ed.2d 131. Alleging that its function, location, and often congested condition make the airport an inappropriate forum for First Amendment protected expression, the defendants cite Adderley v. Florida, 1966, 385 U.S. 39, 87 S.Ct. 242, 17 L.Ed.2d 149, and Lehman v. City of Shaker Heights, 1974, 418 U.S. 298, 94 S.Ct. 2714, 41 L.Ed.2d 770. Asserting that its users represent a captive audience for leafletters, the defendants rely on Lehman v. City of Shaker Heights, supra. Finally, the defendants argue that other appropriate forums are available to the plaintiffs.

The proscriptions of the First and Fourteenth Amendments are primarily directed to governmental activity. But since O’Hare Airport is government-owned and administered, the Amendments are directly applicable to it. Marsh v. Alabama, supra, involved a privately owned “company town” and is inapplicable here except to reinforce the plaintiffs’ claim to protection of their right to free speech, since the Supreme Court in that case saw fit to extend the overriding interest of the United States in freedom of speech as expressed in the Constitution even to privately owned property. Lloyd Corp. v. Tanner, supra, which merely clarified the extent of the application of the First Amendment to private property, is also inapplicable. That case involved a privately owned shopping center mall. In that case the owners were not required by the Court to permit handbilling on a controversial subject unrelated to their enterprise. The only similarity of that case to this one is the commercial nature of the airport facility. However, the plaintiffs do not here claim any right to distribute leaflets on airplanes or in other privately owned or leased places but only in the spacious, city-owned common areas which resemble those public thoroughfares which have been long recognized to be particularly appropriate places for the exercise of constitutionally protected rights to communicate ideas and information. Hague v. CIO, 1939, 307 U.S. 496, 515-516, 59 S.Ct. 954, 83 L.Ed. 1423. This well-established principle has been applied to a publicly owned bus terminal in Wolin v. Port of New York Authority, 2d Cir. 1968, 392 F.2d 83, cert. den. 393 U.S. 940, 89 S.Ct. 290, 21 L.Ed.2d 275, and to the airport of the City of Oakland in Kuszynski v. Oakland, 9 Cir. 1973, 479 F.2d 1130.

The City’s claim that the public receives a limited invitation to use O’Hare Airport for travel purposes only is not supported by the evidence nor do we think it is realistic. For the fact is that great numbers of people are freely admitted to the public areas of the terminal buildings not only in connection with air travel, but also for shopping, dining, sightseeing, or merely to satisfy their curiosity. There is no question but that the terminal buildings at O’Hare Airport, city-owned and operated, are freely available to the general public and that their wide-open public areas which perhaps 90,000 transients visit daily can accommodate seven persons peacefully distributing, in groups of twos and threes, free copies of their publication to interested persons. Indeed, although airport and airline officials testified that unrestricted leafletting and solicitation could conceivably interfere with important airport operations, the City does not contend that the activities of the plaintiffs do in fact obstruct airport traffic.

The defendants argue that not all publicly owned facilities are available for every expression of free speech and they cite Adderley v. Florida, supra, and Lehman v. City of Shaker Heights, supra. With this we, of course, agree. Thus hospitals, libraries, office buildings and prisons may call for restrictive regulations appropriate to their functions. The Supreme Court, in upholding the conviction of 32 student demonstrators on charges of trespass with malicious and mischievous intent on the premises of a county jail, stated, in distinguishing an earlier case, “Traditionally, state capítol grounds are open to the public. Jails, built for security purposes, are not.” Adderley v. Florida, supra, at p. 41, 87 S.Ct. at 244. The public areas of the terminal buildings at O’Hare Airport are not security facilities and are open to the public.

Like the decision in Adderley v. Florida, supra, Lehman v. City of Shaker Heights, supra, does not purport to deal with the distribution of the printed word, the traditionally protected expression of free speech with which we are here concerned. The Lehman case, settling an equal protection argument as to access to car card spaces in the vehicles of a city-owned rapid transit system, is based almost entirely upon the nature of the free-speech expression involved therein, display advertising, as to which the passenger’s eye is captive. The city’s policy in that case of refusing to permit political display advertising in its cars occupied by paying commuters was upheld. The case has no relevance to the present problem.

Defendants’ argument that the plaintiffs have alternate forums for dis-' tributing their literature and that for this reason access to O’Hare Airport may be totally denied under the Constitution is without merit. An individual “is not to have the exercise of his liberty of expression in appropriate places abridged on the plea that it may be exercised in some other place.” Schneider v. State, 1939, 308 U.S. 147, 163, 60 S.Ct. 146, 151; Amalgamated Food Employees v. Logan Valley Plaza, 1968, 391 U.S. 308, 323-324, 88 S.Ct. 1601, 20 L.Ed.2d 603; Wolin v. Port of New York Authority, 2d Cir. 1968, 392 F.2d 83, 91-92, cert. den. 393 U.S. 940, 89 S.Ct. 290, 21 L.Ed.2d 275.

The defendants have argued that the plaintiffs failed to establish their right to a preliminary injunction because they failed to prove that if such relief was not granted they would suffer irreparable injury during the trial. As to this it is perhaps enough to point out that the injunction now before us on this appeal has been treated by the parties as a final injunction terminating the litigation. However, we think that in any case an adequate showing of irreparable injury has been made. For the evidence indicates that the defendants, through their agents, threatened the individual plaintiffs with arrest if they persisted in asserting their First Amendment rights. Such threats undoubtedly had a chilling effect on the plaintiffs’ exercise of their rights, in fact deterring them from exercising those rights. This was an adequate showing to support injunctive relief in a case of this kind. Dombrowski v. Pfister, 1965, 380 U.S. 479, 85 S.Ct. 1116, 14 L.Ed.2d 22.

We conclude that the district court did not err in enjoining the defendants from obstructing the plaintiffs from leafletting in the terminal buildings of O’Hare Airport. At the same time we recognize, as the district court did when it excluded the “fingers” leading to the arrival and departure gates from its injunction, that the Constitution does not prohibit all regulation of leaf-letting in publicly owned facilities. Regulations narrowly drawn to protect the state’s substantial interests with the; least possible constriction of the exercise of free speech and press have long been upheld. Cox v. Louisiana, 1965, 379 U.S. 559, 562, 85 S.Ct. 476, 13 L.Ed.2d 487. Thus regulations prohibiting leafletting might validly be extended from the passageways leading to the arrival and departure gates to include also leafletting at check-in counters, for example, if it should appear that such activities substantially interfere with rapid and efficient airport operations. However, it does not appear from the present record that the plaintiffs’ leafletting took place at check-in counters or with people waiting at them to be checked in or that the plaintiffs intend in the future to carry on their activities at such places. It will be time enough, therefore, to consider enlarging the present exception to the general scope of the injunction in question if and when the City promulgates a suitable restrictive regulation and makes the requisite showing to the district court of the need for it.

Affirmed.