author: THORNBERRY, Circuit Judge:

text:
    Richard E. DRISKILL, Plaintiff-Appellant, v. DALLAS COWBOYS FOOTBALL CLUB, INC., et al., Defendants-Appellees.
    No. 73-2659.
    United States Court of Appeals, Fifth Circuit.
    Aug. 9, 1974.

      William E. Skye, Alexandria, La., Carl J. Schmolder, Dallas, Tex., for plaintiff-appellant.
    Marshall Simmons, William D. Sims, Jr., Dallas, Tex., for Dallas Cowboys, Leage & Rozell.
    Don Rorschach, City Atty., Irving, Tex., Robert W. Smith, Dallas, Tex., for City of Irving, Tex.
    Rayford Price, Dallas, Tex., for defendants-appellees.
    Before GEWIN, THORNBERRY and SIMPSON, Circuit Judges.
   THORNBERRY, Circuit Judge:

Driskill brought this action under § 1 of the Sherman Anti-Trust Act, 15 U.S. C.A. § 1, alleging that the Cowboys and the City of Irving have established an illegal “tying” arrangement, requiring the purchase of undesirable items — preseason tickets and low-interest stadium bonds — as a condition for the purchase of the desirable item — the season ticket package, with its attendant preferential seating location, parking privileges, and right to reserve a season ticket and a particular seat for the following season. The district court granted summary judgment in favor of defendants, holding as follows: (1) since single game tickets have been available for every home game in the past, Driskill has not been coerced to buy preseason tickets in order to gain admission to the regular season games; (2) the granting of preferred parking to season ticket holders is a reasonable business practice with no anticompetitive effect; (3) since individual home game tickets have always been available, Driskill has not been coerced to buy a stadium bond in order to gain admission to regular season games; and (4) forcing the purchase of a stadium bond or bonds as a prerequisite to the purchase of a season ticket package has no anticompetitive effect. We affirm on the ground that Driskill has not pleaded that the tying of season tickets to preseason tickets and stadium bonds has an anticompetitive effect, nor has he alleged with particularity any material facts in issue that would support a finding of anticompetitive effects or coercion to purchase the bonds so as to avoid an adverse summary judgment.

There has been a spate of cases alleging Sherman Act violations in the tying of preseason tickets to season tickets by various National Football League teams. These cases have all resulted in summary judgments for the defendant teams. See Pfeiffer v. New England Patriots Football Club, Inc., D.Mass.1972, 1973 Trade Cas. ¶ 74,267, appeal dismissed, 1 Cir., Nov. 1, 1972, No. 72-1306; Laing v. Minnesota Vikings Football Club, Inc., D.Minn.1973, 372 F.Supp. 59, aff’d 8 Cir. 1974, 492 F.2d 1381, petition for cert. filed, 42 U.S.L.W. 3693, U.S., May 16, 1974; Coniglio v. Highwood Services, Inc. [Buffalo Bills], W.D.N.Y., 1973, 60 F.R.D. 359, aff’d, 2 Cir. 1974, 495 F.2d 1286; Grossman Development Co. v. Detroit Lions, Inc., E.D.Mich. 1973, 1973-2 Trade Cas. ¶ 74,790, appeal docketed, 6 Cir. 1974, No. 74-1093; Rubin v. Miami Dolphins, Ltd., S.D.Fla., May 22, 1974, No. 74-129-Civ-CA. Summary judgments have been granted or upheld on appeal on three different theories: (1) that fans are not in fact coerced into buying tickets to preseason games (as part of a season ticket package) in order to gain admission to regular season games; (2) that no tying of one product to another is possible, since there do not exist two different products —preseason and regular season games —but rather only one indivisible product —professional football games; and (3) that the tying of preseason to regular season tickets has no anticompetitive effect in the tied market. We agree with the conclusion reached by the Second Circuit after a very careful analysis in Coniglio, that, although neither of the first two theories is sufficient to sustain the summary judgment here, the last provides a basis of affirmance. See also Grossman Development Co. v. Detroit Lions, Inc., supra.

A tying agreement is “an agreement by a party to sell one product but only on the condition that the buyer also purchases a different (or tied) product. .” Northern Pacific Ry. v. United States, 1958, 356 U.S. 1, 5, 78 S.Ct. 514, 518, 2 L.Ed.2d 545. Tying agreements violate the Sherman Act

whenever a party has sufficient economic power with respect to the tying product to appreciably restrain free competition in the market for the tied product and a “not insubstantial” amount of interstate commerce is affected.

Id. at 6, 78 S.Ct. at 518. Thus there are four characteristics of an illegal tying arrangement:

(1) two separate products, the tying product and the tied product;
(2) sufficient economic power in the tying market to coerce purchase of the tied product;
(3) involvement of a not insubstantial amount of interstate commerce in the tied market; and
(4) anticompetitive effects in the tied market.

Coniglio v. Highwood Services, Inc., 2 Cir. 1974, 495 F.2d at 1289.

It seems clear here, as in Coniglio, that a not insubstantial amount of interstate commerce in the tied market is involved, since, according to the affidavit of Texas E. Schramm, President of the Cowboys, season ticket holders have accounted for approximately one-half of the seating capacity of the stadium. Similarly, we agree with the Coniglio court that the issues of separability of the preseason and regular season ticket product markets and existence of sufficient market power to coerce purchase of the tied product are triable issues of fact not subject to proper adjudication by summary judgment. As in Coniglio, however, the Cowboys have a complete monopoly in the tied market — preseason professional football games in Dallas— and there can thus be no adverse effect on any competitors, even if a tying scheme exists. There being no anticompetitive effect in the tied market, the fourth requirement for a Sherman Act tying scheme is not met, and the portion of Driskill’s suit dealing with preseason game tickets was properly dismissed on summary judgment for the defendants.

This suit presents a claim not present in any of the other litigation, however. Driskill alleges the tying of undesirable low-interest stadium bonds to the desirable season ticket package, while all the other suits presented only the issue of tying preseason game tickets to those for the regular season games. This claim quite clearly involves two different products — long-term bonds and football tickets — and the Cowboys concededly have a complete monopoly over the latter, which is the tying product. However, even assuming that Schramm’s affidavit establishes that a not insubstantial amount of commerce is involved, since each of the season ticket holders must buy one or more stadium bonds which cost $250 each, Driskill failed to forestall summary judgment on this part of his claim by failing to assert specific facts tending to show either exploitation of their monopoly by the Cowboys to coerce the purchase of the bonds or any anticompetitive effect in the tied market for long-term bonds. Since Driskill failed to come forth with a showing of any specific facts supporting his position with regard to either coercion or anticompetitive effects, the summary judgment against him was proper.

Affirmed.


source: Caselaw Access Project

author: PER CURIAM:

license: Public Domain

text:
    UNITED STATES of America, Plaintiff-Appellee, v. William Douglas CROWELL, Defendant-Appellant.
    No. 73-2842
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    July 31, 1974.
    William Douglas Crowell, pro se.
    John L. Briggs, U. S. Atty., Jacksonville, Fla., Claude H. Tison, Jr., Oscar Blasingame, Asst. U. S. Attys., Tampa, Fla., for plaintiff-appellee.
    Before BROWN, Chief Judge, and THORNBERRY and AINSWORTH, 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 case returns to our Court after a remand for a determination by the District Court as to whether Crowell was afforded the benefits of 18 U.S.C.A. § 3432 and Rule 24(b) which provide that a person charged with a capital offense shall be furnished with a list of the veniremen three days prior to trial and afforded 20 peremptory challenges. The District Court found that Crowell was not afforded the benefits of 18 U.S.C.A. § 3432 or Rule 24(b) but affirmed the conviction on the ground that Crowell was not entitled to the special procedural benefits since a tacit agreement prior to trial rendered it impossible that Crowell would receive capital punishment. United States v. Crowell, S.D. Fla., 1973, 359 F.Supp. 489. While not approving the trial court’s failure to abide by the mandatory provisions of the statute, we feel that to remand for a new trial following the extensive hear-

ing by the District Court would be an undue exaltation of form, and therefore affirm the decision of the District Court.

Crowell, represented by two court-appointed attorneys, was convicted upon trial by a jury of bank robbery and forcing a cashier of the bank to accompany him in an attempt to avoid apprehension (18 U.S.C.A. § 2113(a), (b) and (e)). He received three concurrent sentences of 20, 10, and 20 years, but on the filing of a § 2255 motion contending that he had been denied his right to a direct appeal, the District Court, on its own motion, resentenced the appellant to serve only one sentence of 20 years. On direct appeal from this sentence, appellant raised his contentions that he was not afforded the procedural benefits of 18 U.S.C.A. § 3432 and Rule 24(b). Since the record did not show whether the appellant had been granted these benefits, the Fifth Circuit remanded for further hearings by the District Court. United States v. Crowell, 5 Cir., 1971, 442 F.2d 346.

It appearing from the record that the district court afforded the appellant two counsel pursuant to the directions of Title 18, U.S.C., § 3005, which requires, if requested, two attorneys in capital cases, and it not appearing from the record that Crowell was afforded the benefits of the provisions of Title 18, U.S.C., § 3432 or Rule 24(b), F.R.Cr.P., the case is remanded back to the district court for a hearing to determine if the court afforded Crowell the benefits of these provisions before and at the time of the trial. Section 3432 is mandatory, and a defendant indicted for a capital offense must be given the benefits of its provisions, Logan v. United States, 144 U.S. 263, 12 S.Ct. 617, 36 L.Ed. 429, and the failure to allow defendant its benefits would be plain error. See Rule 52(b), F.R.Cr.P.; Amsler v. United States, 9 Cir., 1967, 381 F.2d 37, 442 F.2d at 347-348.

On remand the District Court conducted an extensive hearing and entered findings of fact and conclusions of law affirming the appellant’s conviction. The Judge found that the case was not tried as a capital case, nor was the appellant faced with the possibility of a death sentence at trial. While there was no formal mention in the record of an agreement not to seek the death penalty, the Judge concluded from testimony that a tacit agreement had been reached between defense counsel and the prosecution not to seek capital punishment.

We find substantial evidence in the record to support the District Court’s conclusion that there was an agreement prior to trial not to seek the death penalty. However, we wish to make clear that we do not approve the trial Judge’s failure to comply with the letter of the statute so long as the record did not formally negate the Government’s purpose to seek the death sentence. The Ninth Circuit has ruled on this issue twice and most recently held that an on-the-record waiver of the death penalty by the Government was required prior to trial. Loux v. United States, 9 Cir., 1968, 389 F.2d 911. See also Amsler v. United States, 9 Cir., 1967, 381 F.2d 37.

Considering the findings and reasoned opinion of the District Judge, we do not require a remand for a new trial. There was clearly in fact no possibility that the defendant would receive capital punishment as a result of the trial. The District Court’s findings add up to the conclusion that though never formally expressed on the record, all knew that capital punishment would not be sought. In these circumstances to remand for a new trial would not serve the best interests of the administration of justice.

Affirmed.


text:
    HANG TEN INTERNATIONAL (Substituted for Doris Moore of California, Inc.), Plaintiff-Appellant, v. SHERRY MANUFACTURING COMPANY, INC., Defendant-Appellee.
    No. 74-1476
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    July 31, 1974.
    John Cyril Malloy, Miami, Fla., Andrew J. Belansky, Richard D. Seibel, Pasadena, Cal., Richard W. Bussoff, New Orleans, La., for plaintiff-appellant.
    M. A. Baskin, Miami, Fla., Leon Epstein, Miami Beach, Fla., James L. Guilmartin, Miami, Fla., for defendant-appellee.
    Before COLEMAN, DYER and RO-NEY, 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 March, 1971, Doris Moore of California, Inc., appellant’s predecessor in interest, filed a trademark infringement complaint against Sherry Manufacturing Company, Inc. The issue was settled by consent decree wherein appellee was enjoined from using appellant’s trademark, a pair of bare footprints side-by-side, with the right print positioned slightly ahead of the left. The mark is not restricted in size or color, although it primarily appears on the left breast of the appellant’s tee shirts, in gold, with the prints about % of an inch long. The design that appellee agreed to stop manufacturing was a tee shirt with a single set of bare footprints on the left breast with the words Galveston, Texas above and below the prints.

In April, 1973, Hang Ten filed a contempt motion against Sherry, alleging that they were making use of Hang Ten’s trademark or simulations thereof. It asked for indemnity, destruction of Sherry’s catalogs, injunction against sale of the offending goods, and costs. A hearing was had before Judge Atkins, the same judge who had signed the consent order. He found that the use of the bare footprints by appellee was not the use of a simulation of appellant’s trademark, that no likelihood of confusion had been shown. The contempt motion was accordingly denied.

In these circumstances, the rule of Eskay Drugs v. Smith, Kline & French Laboratories, 5 Cir., 1951, 188 F.2d 430, does not apply.

Findings as to likelihood of confusion are factual and not to be overturned unless clearly erroneous, Sun-Maid Raisin Growers of California v. Sunaid Food Products, Inc., 5 Cir., 1966, 356 F.2d 467; National Association of Blue Shield Plans v. United Bankers Life Insurance Company, 5 Cir., 1966, 362 F.2d 374.

Consequently, the judgment is Affirmed.


text:
    GENERAL MOTORS CORPORATION, etc., Plaintiff-Appellant, v. DADE BONDED WAREHOUSE, INC., et al., Defendants-Appellees.
    No. 73-2652.
    United States Court of Appeals, Fifth Circuit.
    Aug. 5, 1974.
    William G. Earle, Miami, Fla., for plaintiff-appellant.
    Harold C. Knecht, Jr., Coral Gables, Fla., for Moore Pipe & Sprinkler.
    Dan G. Wheeler, Jr., Miami, Fla., for Blanche R. Bergin.
    Hugh L. Wood, Jeanne Heyward, Miami, Fla., for Dade Bonded Warehouse.
    Before THORNBERRY, COLEMAN and AINSWORTH, Circuit Judges.
   PER CURIAM:

In this action General Motors asserted claims against both Dade Bonded Warehouse, Inc. and Blanche R. Bergin, executrix of the estate of Cecil A. Bergin. Although the jury was charged on the various theories of liability possibly applicable to Bergin, their verdict did not mention the claim against her. Furthermore, a careful search of the record reveals that no judgment was ever entered on this claim, although the district court did deny General Motors’ motion for a new trial against Bergin. Thus the judgment fails to adjudicate all the claims and liabilities of all the parties, as required by F.R.Civ.P. 54(b). No certificate under F.R.Civ.P. 54(b) appears in the record. We therefore dismiss the appeal for want of jurisdiction. 11 C. Wright & A. Miller, Federal Practice and Procedure: Civil § 2781; F.R.Civ.P. 58; 28 U.S.C. § 1291. See, e. g., Anderson v. Robinson, 5 Cir. 1974, 494 F.2d 45; Foret v. McDermott, 5 Cir. 1973, 484 F.2d 992. See also, United States v. Indrelunas, 1973, 411 U.S. 216, 93 S.Ct. 1562, 36 L.Ed.2d 202; State National Bank of El Paso v. United States, 5 Cir. 1974, 488 F.2d 890.

Should the district court enter a new judgment on General Motors’ claim against Dade Bonded Warehouse, Inc., and issue the Rule 54(b) certificate, the appeal from that judgment may be submitted on the record and briefs prepared for this appeal, supplemented by the new judgment and certificate, and on the oral arguments heretofore heard.

Dismissed.


text:
    GEORGE W. BENNETT BRYSON & COMPANY, LTD., Plaintiff-Appellee, v. NORTON LILLY & CO., INC., Defendant-Appellant.
    No. 74-1357
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    Aug. 2, 1974.
    Rehearing and Rehearing Eh Banc Denied Oct. 23, 1974.
    See 502 F.2d 1045.
    Richard F. Ralph, Donald F. Geffner, Miami, Fla., Cicero C. Sessions, Robert E. Barkley, Jr., New Orleans, La., for defendant-appellant.
    Douglas Batchelor, Samuel A. Broadnax, Jr., Rex B. Guthrie, Kermit G. Kindred, Timothy J. Armstrong, Miami, Fla., for plaintiff-appellee.
    Before BROWN, Chief Judge, and THORNBERRY and AINSWORTH, 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 diversity suit was filed by George W. Bennett- Bryson & Company, Ltd., against Norton Lilly & Company, Inc., seeking recovery for allegedly furnishing materials, supplies, equipment, and services on open account to Norton Lilly. Norton Lilly denies that the goods and services were furnished for its account and contends that they were furnished for the account of Sea Way Lines, Inc., a company of which Norton Lilly had recently acquired all the capital stock.

On the day of the acquisition, Norton Lilly and Sea Way executed a “managing agency agreement” under which, the district court found, Norton Lilly was given unlimited authority over the entire operation of Sea Way for an initial period of five years. After a trial on the merits without a jury, the court below entered judgment for Bryson in the amount of $17,795.30.

Norton Lilly makes two arguments on appeal. First, it contends that it should not be held liable for the debts of Sea Way because an agent for a disclosed principal is not personally liable. With respect to this issue, however, the district court concluded that Norton Lilly “was not acting as a managing agent for a disclosed principal”, and the court had before it more than enough evidence from which it could so conclude. Second, Norton Lilly argues that the record does not contain any evidence to justify disregarding the corporate entities. The district court found that, following the acquisition of Sea Way, Norton Lilly was acting as the de facto charterer and operator of certain motor vessels owned by Sea Way for which the goods and services had been supplied and became obligated for these supplies and services. A careful review of the record reveals that this conclusion is amply supported by the evidence.

The district court’s findings of fact are not clearly erroneous, Fed.R.Civ.P. 52(a); nor were they induced by an erroneous view of the law. See Chaney v. City of Galveston, 5 Cir., 1966, 368 F.2d City of Galveston, 5 Cir., 1966, 368 F.2d 774, 776; Baggett v. Richardson, 5 Cir., 1973, 473 F.2d 863, 865.

Affirmed.


text:
    UNITED STATES of America, Plaintiff-Appellee, v. Marshall Crosby MILNE, a/k/a Phillip C. Gordon, Defendant-Appellant.
    No. 74-1253
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    Aug. 8, 1974.
    Aaron A. Green, Gainesville, Fla. (Court-appointed), for defendant-appellant.
    William H. Stafford, Jr., U. S. Atty., Pensacola, Fla., Clinton Ashmore, Stewart J. Carrouth, Asst. U. S. Attys., Tallahassee, Fla., for plaintiff-appellee.
    Before BELL, SIMPSON and MORGAN, 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:

Appellant was tried before a jury, and sentenced after conviction of two counts of distribution of heroin, a Schedule II controlled substance, in violation of Title 21 U.S.C. Sec. 841(a)(1).

On appeal Milne contends (1) that the trial judge abused his discretion by not permitting, upon his request, a bifurcated trial as to the separate issues raised by his defense of not guilty and his separate defense of mental incompetency at the time of the offense, and (2) that the prosecutor’s remarks during closing jury argument were so prejudicial as to deny him a fair trial. We find no merit in either contention and affirm.

Appellant cites a line of cases from the D.C. Circuit in support of his first ground of error. Regardless of the soundness of the views of our sister circuit, the question raised is answered for us by United States v. Huff, 5 Cir. 1969, 409 F.2d 1225, cert. denied, 1969, 396 U.S. 857, 90 S.Ct. 123, 24 L.Ed.2d 108, where we affirmed the denial by the district court of the same claimed right to a trial bifurcated as to the issues of guilt or innocence and insanity at the time the offense was committed, relying upon Spencer v. State of Texas, 1967, 385 U.S. 554, 567-568, 87 S.Ct. 648, 655-656, 17 L.Ed.2d 606; United States v. Jackson, 1968, 390 U.S. 570, 88 S.Ct. 1209, 20 L.Ed.2d 138, and Bell v. Patterson, D.Colo.1968, 279 F.Supp. 760-767. In Huff we specifically rejected the District of Columbia Circuit holding in Holmes, supra.

As to the second point raised, that of prejudicial closing argument by the Assistant United States Attorney at appellant’s trial, we determine from study of the record that the remarks objected to were elicited by defense counsel’s argument, and constituted fair reply thereto.

Affirmed.

      . This appeal is from Milne’s second conviction for the same offenses. We reversed his prior conviction, United States v. Milne, 5 Cir. 1973, 487 F.2d 1232, because of the trial judge’s refusal to permit lay witnesses to testify in support of Milne’s defense of insanity at the time of the commission of the alleged violation.

      . Holmes v. United States, 1966, 124 U.S.App.D.C. 152, 363 F.2d 281; United States v. Ashe, 1970, 138 U.S.App.D.C. 356, 427 F.2d 626; United States v. Bennett, 1972, 148 U.S.App.D.C. 364, 460 F.2d 872; United States v. Green, 1972, 150 U.S.App.D.C. 222, 463 F.2d 1313.

      . Cf. Murphy v. State of Florida, 5 Cir. 1974, 495 F.2d 553 where we found no federal constitutional due process barrier to the denial by a Florida trial court of a bifurcated trial as to similar issues of innocence and insanity.


text:
    Rigoberto GONZALEZ et al., Plaintiffs-Appellants, v. INTERNATIONAL LONGSHOREMEN’S ASSOCIATION LOCAL NO. 1581, AFL-CIO, Defendant-Appellee.
    No. 74-1658
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    Aug. 1, 1974.

      Kenneth L. Tilley, Houston, Tex., for plaintiff-appellant.
    Gerald J. Goodwin, Houston, Tex., for defendant-appellee.
    Before COLEMAN, DYER and RO-NEY, Circuit Judges.

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

   PER CURIAM:

Displeased because their seniority rights were allegedly adversely affected by a majority vote of the union membership, plaintiffs brought suit under section 301(a) of the National Labor Relations Act, 29 U.S.C.A. § 185(a), for violation of the Union’s duty of fair representation. The district court dismissed the complaint for want of jurisdiction. We affirm.

The Union served as a daily hiring hall for the Port of Houston. While the latter looked to the Union as a source of labor, there was no collective bargaining agreement between the Union and the Port.

As a result of a seniority plan adopted by a majority of the Union in 1972, those who had worked predominately in the Compress Department found themselves with less seniority than those who had worked mainly in the Dock Department and thus had decreased opportunities to obtain dock work. The plaintiffs’ suit followed.

We think it is clear that there must be a collective bargaining agreement and a breach of that agreement to confer jurisdiction on a federal district court under Section 301 of the Act. See Rae v. United Parcel Service of Pa., E.D.Pa. 1973, 356 F.Supp. 465, 468; Genesco, Inc. v. Joint Council 13, United Shoe Workers of America, S.D.N.Y.1964, 230 F.Supp. 923, 928-29, aff’d, 2 Cir. 1965, 341 F.2d 482. Fatal to the jurisdiction of the court below was the showing that there was no bargaining agreement between the Port and the Union.

Affirmed.

      . Any such agreement would have been void as against the statutory policy of the State of Texas. Vernon’s Ann.Civ.St. art. 5154c, § 1.

      . Section 301(a) of the Act provides: “Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this chapter, or between any such labor organizations, may be brought in any district court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without regard to the citizenship of the parties.”

      . Whether there was an “under the table” bargaining agreement between the Port and the Union as suggested by the plaintiffs does not merit discussion.


author: AINSWORTH, Circuit Judge:

text:
    SPENCER BOAT CO., INC., Plaintiff-Appellee, v. John L. LIUTERMOZA et al., Defendants-Appellants.
    No. 74-1069
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    Aug. 2, 1974.
    Rehearing and Rehearing En Ranc Denied Oct. 16, 1974.
    Frank E. Maloney, Jr., Fort Lauder-dale, Fla., for defendants-appellants.
    Donald F. Geffner, Richard F. Ralph, Miami, Fla., for plaintiff-appellee.
    Before BROWN, Chief Judge, and THORNBERRY and AINSWORTH, 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.

   AINSWORTH, Circuit Judge:

Defendants, Liutermoza and Zimmerman, appeal from a judgment on a contract whereby plaintiff, Spencer Boat Company, undertook to repair defendants’ boat. This appeal challenges service of process upon defendants pursuant to Florida’s long-arm statute and the award of attorneys’ fees as provided in the contract. We reverse on the first issue, and therefore the second need not be reached.

I. The Facts and the Statute

As relevant to the jurisdictional question, the facts of the case are as follows. Defendants, Connecticut residents, visited Florida in 1970 and bought a pleasure boat. They sailed the boat to Connecticut, receiving the bill for the work upon their arrival. After the voyage a dispute developed over whether plaintiff had performed the repairs in a workmanlike manner. Defendants ultimately refused to pay the bill. At trial defendants unsuccessfully contended they could not be served under the Florida long-arm statute, Fla.Stat.Ann. § 48.-181, which provides in relevant part:

(1) The acceptance by any person or persons, individually, or associated together as a copartnership or any other form or type of association, who are residents of any other state or country, ... of the privilege extended by law to nonresidents and others to operate, conduct, engage in, or carry on a business or business venture in the state, . . ., constitutes an appointment by the persons . of the secretary of state of the state as their agent [for service of process] ....

In 1973 the Florida Legislature amended the long-arm statute to provide for service on any person who allegedly “(g) Breaches a contract in this state by failing to perform acts required by the contract to be performed in this state.” Laws of Florida, Ch. 73-179. The clear implication is that the pre-1973 law, which applies to this case, did not reach such transactions.

II. Construing the pre-1973 Statute

Defendants’ activities in Florida do not fit the literal terms of the statute. To do business or conclude a business transaction is not “to operate, conduct, engage in, or carry on a business or business venture in the state,” and the statute must be construed strictly, not broadly. See Lyster v. Round, 276 So.2d 186, 188 (Fla.App.1973) (citing DeVaney v. Rumsch, 228 So.2d 904 (Fla.1969)); Young Spring & Wire Corp. v. Smith, 176 So.2d 903 (Fla.1965). Departure from the literal terms does not improve plaintiff’s case. Recent decisions of the Florida courts leave no doubt that intent on the part of the nonresident to seek pecuniary benefit is essential to long-arm jurisdiction under the statute. See Lyster v. Round, supra (citing DeVaney v. Rumsch, supra); Compuguide Corporation v. Sachs, 259 So.2d 513 (Fla.App.1972). There was no such intent in the present case.

The judgment of the District Court is reversed and the cause is remanded with directions to enter an order quashing the attempted service of process upon defendants.

Reversed and remanded.

      . Although the defendants were business partners, the trial court specifically found that the purchase of the boat was wholly unrelated to any business venture or other undertaking for pecuniary benefit.

      . Appellee’s citation of Internatiional Shoe Co. v. State of Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945) and McGee v. International Life Ins. Co., 355 U.S. 220, 78 S.Ct. 199, 2 L.Ed.2d 223 (1957), in support of a broad construction of the statute, are entirely inapposite. Those cases hold only that the requirements of due process are to be interpreted so as to uphold such statutes if possible. There is no constitutional challenge here, and those cases say nothing about whether a particular enactment is coextensive with the constitutional limits.

      . Plaintiff asserts that Plying Saucers, Inc. v. Moody, 5 Cir., 1970, 421 F.2d 884, which upheld long-arm jurisdiction on facts very similar to those in the present case, is controlling. As the court noted in Moody, however, federal court construction of state law is to be relied upon only in the absence of supervening state court interpretations, 421 F.2d at 886-887, several of which we have already noted.


text:
    UNITED STEELWORKERS OF AMERICA, AFL-CIO, Plaintiff-Appellant-Cross Appellee, v. UNITED STATES GYPSUM COMPANY, Defendant-Appellee-Cross Appellant.
    No. 72-2694.
    United States Court of Appeals, Fifth Circuit.
    July 31, 1974.
    Jerome A. Cooper, Birmingham, Ala., Bernard Kleiman, Gen. Counsel, Pittsburgh, Pa., Michael H. Gottesman, Jeffrey Gibbs, Washington, D. C., for plaintiff-appellant.
    J. S. Gruggel, Jr., John J. Coleman, Jr., Birmingham, Ala., Harold D. Burgess, J. T. Otis, Chicago, 111., for defendant-appellee.
   ON PETITION FOR REHEARING

(Opinion April 11, 1974, 5 Cir., 1974, 492 F.2d 713).

Before BELL, INGRAHAM and RO-NEY, Circuit Judges.

PER CURIAM:

We are aware of the Supreme Court’s recent decision in Howard Johnson Co., Inc. v. Detroit Loc. Jt. Exec. Bd., - U.S. -, 94 S.Ct. 2236, 41 L.Ed.2d 46 (1974), overruling the Sixth Circuit’s decision, 482 F.2d 489 (1973), that Howard Johnson, as a successor employer, was bound to arbitrate with the union concerning the extent of its obligations to its predecessor’s employees. Concluding that “there was plainly no substantial continuity of identity in the work force hired by Howard Johnson,” - U.S. at-, 94 S.Ct. at 2244, the Court held that Howard Johnson had no duty to arbitrate with the union. But, as we emphasize in our opinion, there was a substantial continuity of identity present in the case at bar. 492 F.2d at 716, 726. In short, we believe that the principles of Wiley remain viable in the circumstances of our case.

The petition for rehearing is in all respects denied.


author: EUGENE A. WRIGHT, Circuit Judge:

text:
    UNITED STATES of America for the Use of BUILDING RENTALS CORP., d/b/a Dick Fritz Painting, Appellant and Cross-Appellee, (Plaintiff below) v. The WESTERN CASUALTY AND SURETY COMPANY, et al., Appellees and Cross-Appellants. COMMERCIAL LATHING COMPANY, d/b/a Pacific Plastering Corporation, a California corporation, Appellant, (Cross-Claimant below) v. BUILDING RENTALS CORPORATION, a corporation, d/b/a Dick Fritz Painting: Dick Fritz, Appellees, (Cross-Defendants below).
    Nos. 73-1004, 73-1005.
    United States Court of Appeals, Ninth Circuit.
    June 4, 1974.

      C. E. Millikan, Jr. (argued), of Millikan, Montgomery & Olafson, Pasadena, Cal., for appellant and cross appellee.
    James B. Merzon (argued), of Ogle & Gallo, Morro Bay, Cal., Fitzgerald, Abbott & Beardsley, Oakland, Cal., Fullerton, Lang & Richert, Fresno, Cal., for appellees and cross appellants.
    Before ELY and WRIGHT, Circuit Judges, and McGOVERN, District Judge.

       Of the Western District of Washington.

   OPINION

EUGENE A. WRIGHT, Circuit Judge:

This case originated as a claim under the Miller Act by a sub-subcontractor against the subcontractor and its sureties. Plaintiff appeals and defendants cross-appeal from a district court judgment awarding plaintiff $9,467.79 as the balance of the reasonable value of labor and material furnished by plaintiff on a construction job. We are concerned on appeal with two main issues: (1) whether the district court properly determined the amount of restitution due plaintiff upon rescission of the contract; (2) whether the district court’s finding that defendants’ conduct justified rescission of the contract by plaintiff was clearly erroneous. We remand the case to the district court for further proceedings.

I.

BACKGROUND

The United States contracted with Montgomery Ross Fisher, Inc., not a party here, to build a 440-bed hospital at Fort Ord, California. Fisher entered into a subcontract with defendant Pacific Plastering, whereby Pacific agreed to install gypsum wallboard, metal studs, and plaster for $800,000. Pacific in turn sub-subcontracted the wallboard portion of the work to plaintiff Fritz Painting for $116,000. The latter contract did not require Fritz to furnish a bond.

The payment provision of the Pacific-Fritz sub-subcontract is crucial to this case. It required Pacific to make monthly payments to Fritz according to the percent of the total wallboard work completed. It further provided that Pacific would retain 10% of each progress installment until the job was completed. Pacific was required to make its progress payments within 10 days after it was paid by the prime contractor, Fisher.

Fritz’s material supplier for the job was Central Supply Co. Central Supply met with Pacific and Fritz and agreed to supply materials to Fritz provided that Pacific pay Fritz’s account to Central Supply out of progress payments earned by Fritz. Central Supply gave a 5% discount for payment within 30 days of billing.

Fritz began work on January 29, 1970, and, on February 12, submitted a bill to Pacific for $10,440, reflecting its anticipated progress for February less the 10% to be retained by Pacific. Pacific paid Fritz’s Central Supply bill of $3,271.29 (discounted 5% for prompt payment) and the balance, $7,168.67, to Fritz, all with Fritz’s consent.

In mid-March Fritz billed Pacific for $11,484, based on its anticipated progress for that month. During March, however, Fritz charged $13,002.63 worth of materials at Central Supply, and Pacific paid the entire Central Supply bill on May 6. Because this exceeded the amount actually due Fritz by $1,518.63, Pacific credited the overpayment against Fritz’s April progress payment.

As of May 6, Pacific had made progress payments to Fritz for the estimated completion of 21% of the job during February and March. Fritz submitted a bill in April anticipating that it would complete an additional 9% that month. Its anticipated April progress entitled it, the district court found, to $7,877.37. According to the contract, Pacific was required to pay this amount by May 28, 10 days after it was paid by the prime contractor, first paying Fritz’s debt to Central, and the balance to Fritz.

At this point the facts become disputed. The district court found that, prior to the payment due date of May 28, Fritz demanded that Pacific pay it the entire April draw, rather than part to Central Supply. The district court found that “on account of [Fritz’s] demand and at its request,” Pacific delayed payment of Fritz’s Central Supply bill until after the first part of June. Pacific postponed the payment, according to the court, in order to allow Fritz to demonstrate that it was financially strong enough to justify Pacific’s direct payment of the April draw to Fritz without jeopardizing payment of Fritz’s Central Supply account.

Fritz furnished two financial statements, one at the end of May and another on June 8, but was unable to demonstrate sufficient financial strength, and Pacific refused to pay it directly the April draw. On June 12 Fritz ordered its employees to cease work, giving nonpayment as the reason. The court found that Fritz intended to resume work upon payment for the April progress.

On June 15 Pacific sent $14,144.47 to Central Supply on account of purchases by Fritz of approximately $7,000 during both April and May, this without Fritz’s consent. Had Pacific paid Fritz’s April Central Supply bill by the end of May, there would have been a discount of $356.56. Central Supply allowed none for the April materials because of the late payment.

Pacific completed Fritz’s portion of the job after Fritz stopped working. The prime contractor is withholding $118,000 of the $800,000 due Pacific pending the outcome of this litigation.

The district court concluded that Pacific breached its contract with Fritz in a substantial and material way. The contract obligated Pacific to pay $7,877.37 by May 28, of which $6,773.31 would go to Central Supply (April purchases of $7,129.87 minus 5% discount of $356.56) and the balance, $1,104.06, directly to Fritz. The court concluded that Pacific’s failure to pay entitled Fritz to rescind.

II.

THE AMOUNT OF RESTITUTION

The court having determined that Fritz was justified in regarding the contract as terminated, Fritz became entitled to the reasonable value of all labor and materials that Pacific received in performance of the contract. United States for the use of Coastal Steel Erectors, Inc. v. Algernon Blair, Inc., 479 F. 2d 638, 640 (4th Cir. 1973); Seaboard Surety Co. v. United States, 355 F.2d 139, 144-145 (9th Cir. 1966); Integrated, Inc. v. Alec Fergusson Electrical Contractors, 250 Cal.App.2d 287, 58 Cal.Rptr. 503, 509 (4th Dist. 1967); 5 Corbin on Contracts § 1109, at 582 and § 1112, at 596 (1964).

Unlike damages, the normal remedy for breach of contract which tries to put the injured party in the position he would have been in had the contract been performed, the remedy of restitution is used to put him in as good a position as he held before the contract was made. 5 Corbin on Contracts, supra at 598. The contract price, while evidence of reasonable value, is neither the final determinant of the value of performance nor does it limit recovery. United States v. Algernon Blair, Inc., supra at 641; Scaduto v. Orlando, 381 F.2d 587, 595-596 (2d Cir. 1967); Oliver v. Campbell, 43 Cal.2d 298, 273 P.2d 15, 18-19 (1954). 5 Corbin on Contracts § 1112, 596-597 (1964). Rather, as the Fourth Circuit recently stated, “the standard for measuring the reasonable value of the services rendered is the amount for which such services could have been purchased from one in the plaintiff’s position at the time and place the services were rendered.” United States v. Algernon Blair, Inc., supra at 641; Central Steel Erection Co. v. Will, 304 F.2d 548, 555 (9th Cir. 1955); United States for the use of F. E. Robinson Co. of N. C., Inc. v. Alpha-Continental, 273 F.Supp. 758, 777 (E.D.N.C.), aff’d per curiam, 404 F.2d 343 (7th Cir. 1968), cert. denied 395 U.S. 922, 89 S.Ct. 1774, 23 L.Ed.2d 239 (1969).

In our case, the district court, correctly concluded that Fritz was entitled to the reasonable value of labor furnished and materials supplied. It found that Fritz had completed 40% of the contract before stopping work. Then, using the contract as “important evidence of the value” of Fritz’s performance, the court awarded Fritz judgment for $9,467.79. This sum represents the contract price ($116,000), multiplied by the percentage of completion (40%), plus lost Central Supply discounts ($654.89 for April and June), less amounts already paid to Fritz and Central Supply ($37,587.10).

We find that this sum clearly does not represent the reasonable value of the labor and materials supplied by Fritz, and we therefore remand for reconsideration.

Although Fritz contends that it completed more than 40% of the contract, there is evidence in the record to support the court’s finding of that figure. It appears that Fritz installed more than 40% of the total wallboard, but most of the difficult, time-consuming work (such as putting wallboard around pipes, etc.) was not completed when it stopped work. Therefore, -in terms of labor, Fritz may well have completed only 40% of the contract.

The 40% figure bears no relation, •however, to the total amount of materials supplied. Indeed, Fritz contends that it supplied more than 70% of the total gypsum board installed, including over 42,000 square feet of board left at the jobsite and later used by Pacific when completing Fritz’s portion of the work.

It does not appear that the district court’s finding of 40% even purports to include an estimate of the reasonable value of these materials. We must therefore remand to the district court for independent findings on the reasonable value of both labor and the materials. As indicated above, the court should determine reasonable value by assessing the amount for which the labor and materials could have been purchased from one in Fritz’s position at the time and place the services were rendered.

III.

WAS RESCISSION JUSTIFIED?

Pacific contends on cross-appeal that it did not breach the contract and, in any event, any breach it may hve committed was not so substantial and material as to justify Fritz’s rescission and the remedy of restitution.

Restitution is an available remedy for breach of contract only when the breach is of such vital importance and so material that it is held to go to the “essence” of the contract. 5 Corbin on Contracts § 1104, at 562 (1964). Failure to make progress payments can justify rescission and restitution. Integrated, Inc. v. Alec Fergusson Electrical Contractors, 250 Cal.App.2d 287, 58 Cal.Rptr. 503, 509 (4th Dist. 1967). However, “[a] slight deviation either in time or amount of progress payments should not justify rescission or abandonment.” Id. at 510. Rather, rescission is justified where there is either “an extended and unreasonable delay, imposition of new and onerous conditions to payment, outright refusal, or a total repudiation of the contract.” Id.

The district court found that Pacific’s failure to make the April progress payment within the time or in the amount required by the contract was substantial and material,” justifying Fritz’s rescission of the contract. But the court found also that Pacific delayed the April payment “[o]n account of [Fritz’s] demand and at its request. . . . ”

This latter finding, taken at face value, seems inconsistent with the former. If Fritz did “demand" that Pacific delay payment beyond the time provided in the contract, and if Pacific delayed payment “on account of” this demand, then it would seem that there was, effectively, a modification or waiver of the right to prompt payment.

Waiver may be found where in the course of dealing, one party has dispensed with certain conditions in its favor and the other party has acted without meeting those conditions on the theory that their performance is not required.

United States for the use of F. E. Robinson Co. of N. C., Inc. v. Alpha-Continental, 273 F.Supp. 758, 778 (E.D.N.C.1967), aff’d per curiam, 404 F.2d 343 (4th Cir. 1968), cert. denied, 395 U.S. 922, 89 S.Ct. 1774, 23 L.Ed.2d 239 (1969); see 5 Corbin on Contracts § 1104 at 565 (1964). At the very least, Pacific’s delay in paying, if in fact demanded by Fritz, would not appear to be so unreasonable and material as to justify rescission of the contract and restitution to Fritz.

Because the court’s findings on this issue appear to us to be inconsistent, we remand for clarification. It may be that the court’s choice of words was inadvertent. Or possibly Pacific did breach the contract in a material way, but did so after the time constituting the delay “demanded” by Fritz had expired. See Seaboard Surety Co. v. United States, 355 F.2d 139, 144-145 (9th Cir. 1966). Whatever the case, we are unable to reach a reasoned decision on the record before us.

On remand, the court should clarify whether or not Fritz did in some sense waive the right to timely payment. If the court again concludes that Pacific did breach the contract, it should consider whether the breach was material and substantial, and should articulate the reasons for its conclusion. On remand, Pacific may raise the other arguments made to us challenging the district court’s finding of material and substantial breach. Should the court be persuaded to adopt Pacific’s position, it should consider Pacific’s contention that Fritz in fact breached the contract and, if necessary, it should award appropriate relief.

The case is remanded for further proceedings consistent with this opinion.

      . 40 U.S.C. §§ 270a and 270b.

      . The district court incorrectly stated that the overpayment equalled $1,318.63.

      . Fritz now claims that Pacific should not have paid the entire Central Supply bill because approximately $3,500 of it represented materials purchased for another job. Fritz made no objection to the payment, however,

      . Though not raised by the parties, there is some question whether federal substantive law controls over state law in Miller Act cases. This circuit has held that state law controls, at least as to subcontracts to which the United States is not a party. American Surety Co. v. United States for the use of B & B Drilling Co., 368 F.2d 475, 478 (9th Cir. 1966); United States for the use of J. W. Briggs v. Grubb, 358 F.2d 508, 515 (9th Cir. 1966); Wells Benz, Inc. v. United States for the use of Mercury Electric Co., 333 F.2d 89, 92 n. 3 (9th Cir. 1964); Central Steel Erection Co. v. Will, 304 F.2d 548, 554 (9th Cir. 1962); Continental Casualty Co. v. Schaefer, 173 F.2d 5, 7 (9th Cir.), cert. denied, 337 U.S. 940, 69 S.Ct. 1517, 93 L.Ed. 1745 (1949); see Leo Spear Construction Co., Inc. v. Fidelity and Casualty Co., 446 F.2d 439, 443 n. 1 (2d Cir. 1971); United States for the use and benefit of Shields, Inc. v. Citizens and Southern National Bank, 367 F.2d 473, 477 (4th Cir. 1966). Where provisions of the prime contract are at issue, however, federal law controls. Sam Macri & Sons, Inc. v. United States for the use of Oaks Construction Co., 313 F.2d 119, 124 n. 1 (9th Cir. 1963); see Peter Kiewit Sons’ Co. v. Summit Construction Co., 422 F.2d 242, 260 (8th Cir. 1969). Other circuits have held, however, that federal law controls in all actions under the Miller Act. United States for the use of Coastal Steel Erectors, Inc. v. Algernon Blair, Inc., 479 F.2d 638, 640 n. 2 (4th Cir. 1973); United States for the use of Astro Cleaning & Packaging Corp. v. Jamison Co., Inc., 425 F.2d 1281, 1282 n. 1 (6th Cir. 1970); United States Fidelity and Guaranty Co. v. Hendry Corp., 391 F.2d 13, 18 (5th Cir. 1968). Interstices in federal law may be filled by incorporating state law, though. United States for the use of Astro Cleaning & Packaging Corp. v. Jamison Co., supra at 1282 n. 1.
      We do not expressly distinguish between federal and state law in this opinion because we think that the principles we apply are valid both under federal and California law. See Sam Macri & Sons, Inc. v. United States for the use of Oaks Construction Co., 313 F.2d 119, 124 n. 1 (9th Cir. 1963).

      . It may be that the contract price is severable into specific amounts for labor and for materials. If so, the court could determine that the reasonable value of labor and materials provided by Fritz is represented by two different percentages of these amounts. We intimate no opinion on this. The court’s ultimate concern, however, should be the determination of the reasonable value of the labor and materials, perhaps evidenced by the contract, not the determination of the percentage of contract completed.


author: CHRISTENSEN, Senior District Judge:.

text:
    UNITED STATES of America ex rel. Melvin OLIVER, Petitioner-Appellee, v. Leon VINCENT, Warden of Green Haven Correctional Facility, Respondent-Appellant.
    No. 307, Docket 73-2246.
    United States Court of Appeals, Second Circuit.
    Argued April 5, 1974.
    Decided June 3, 1974.

      Frederick H. Block, New York City, for petitioner-appellee.
    Michael Colodner, Asst. Atty. Gen. of New York, with whom Louis J. Lefkowitz, Atty. Gen. and Samuel A. Hirshowitz, First Asst. Atty. Gen., New York City, were on the brief, for respondent-appellant.
    Before HAYS and OAKES, Circuit Judges, and CHRISTENSEN, Senior District Judge.

       Of the District of Utah, sitting by designation.

   CHRISTENSEN, Senior District Judge:.

There is before us for review an order of the district court granting a writ of habeas corpus to a state prisoner, hereinafter “petitioner”, who had been sentenced to a ten-year term on a plea of guilty found below to have been induced by his attorney’s false assurances that an agreement had been reached for the imposition of a more favorable sentence.

Decided after the proceedings below were concluded Mosher v. LaVallee, 491 F.2d 1346 (2d Cir. 1974), cert. denied, 416 U.S. 906, 94 S.Ct. 1611, 40 L.Ed.2d 111 (1974), affirming, 351 F.Supp. 1101 (S.D.N.Y.1972), involved surprisingly similar circumstances. This decision would render any discussion of the governing principles and other cases superfluous and would justify affirmance of the order in question without extended comment were it not for two contentions principally relied upon here and not considered there: that the district court “erred in ordering an evidentiary hearing in the face of implicit findings of credibility [against petitioner] by the State court judge”, and that “the petitioner could not credibly believe that any such promise was made” as represented by his attorney.

In proceedings in the Supreme Court, New York County, petitioner was indicted in September, 1968, for robbery in the first degree, grand larceny in the second degree, and felonious possession of a weapon, and there were other state charges pending against him. He had also been indicted by a federal grand jury, pleaded guilty in October of that year on two counts and was sentenced in November to federal prison for two consecutive two-year terms.

In December, 1968, petitioner declined an “offer” of the prosecution to satisfy all state indictments in return for a plea of guilty to a “class C” felony to be treated as a “class D” felony. He later testified that his refusal to so plead was because his retained attorney had assured him that a “deal” would be worked out for a sentence in the state court to run concurrently with, and not to exceed, his four-year federal sentence. On Friday, January 10, 1969, petitioner again declined to plead guilty to a “class C” felony apparently for the same reason. However, the following Monday petitioner did plead guilty to the Class C felony of attempted robbery in the first degree, for which on February 4, 1969, he was sentenced to an indeterminate term of not exceeding ten years, without reference to his federal sentence.

Petitioner maintained in the habeas corpus court that he agreed so to plead guilty only after he was assured by his attorney that the “deal” described above had been arranged with the prosecutors and the judge. He further testified that a comment by his attorney following this plea caused him to become worried that his lawyer actually might not have closed the arrangements. Thereafter, but prior to the imposition of sentence, he unsuccessfully attempted to withdraw his plea, and when he appeared for sentencing the state justice acknowledged the withdrawal request but did not afford him an opportunity to state his supporting reasons. On appeal his sentence was vacated and he was remanded to the sentencing justice for resentence by reason of the denial of his right of allocution and particularly for his having been “cut off” from his application to withdraw his plea of guilty. People v. Oliver, 34 A.D.2d 775, 310 N.Y.S.2d 689 (1st Dept. 1970).

Prior to resentencing in October, 1970, the state justice heard statements from the petitioner concerning his reason for wishing to withdraw his plea, consistent with his later testimony before the habeas corpus court, together with contradicting statements from his attorney. No findings concerning petitioner’s claim were made but an evidentiary hearing was ordered, and a new attorney who had been assigned to represent petitioner was directed to file a written motion for leave to withdraw the plea of guilty. Such a written motion was not filed. In April, 1971, petitioner was resentenced, nunc pro tunc, as of February 4, 1969, to the same term of not to exceed ten years, over his objection that his request to withdraw his plea had not been heard. The Appellate Division unanimously affirmed on April 18, 1972, People v. Oliver, 39 A.D.2d 646, 331 N.Y.S.2d 587 (1st Dept. 1972), and leave to appeal to the New York Court of Appeals was denied on July 12, 1972.

Appellant insists that in view of 28 U.S.C. § 2254(d), the state court proceedings somehow obviated any necessity of an evidentiary hearing in the habeas corpus court, justify our disregard' of the latter court’s findings and, indeed, rendered the holding of an evidentiary hearing by that court in itself error.

Even though no evidentiary hearing w7as had in the state court on the issues of voluntariness of the plea and the effective assistance of counsel, appellant argues in effect that the requirements of Section 2254(d) must be deemed satisfied because no formal motion or affidavit was filed as directed by the state jústice and because it was obvious without such a hearing that the sentencing court credited the explanation of the attorney rather than the claims of the respondent. A variation of the latter theme is the contention in reliance upon United States ex rel. Robinson v. Fay, 348 F.2d 705 (2d Cir. 1965), cert. denied, 382 U.S. 997, 86 S.Ct. 583, 15 L.Ed.2d 484 (1966), that a federal court is not obliged to hold a habeas corpus hearing where the state court has credited an attorney rather than his felon client. Granted that under some such circumstances a federal evidentiary hearing is not mandated, this does not answer the question whether a hearing properly may be held by a federal court should it elect to do so.

For the district court to hold an evidentiary hearing was not error per se. Irrespective of whether the conditions of 28 U.S.C. § 2254(d) have been met, a federal court is not precluded from holding such a hearing to determine whether the claims of a petitioner raising as here, a substantial issue of fact can be established by the requisite degree of proof. If the presumption of correctness of state findings applies they can be overcome only by clear and convincing evidence; if no presumption operates,, a petitioner has the burden of proving his case by a preponderance of the evidence. Here the conditions were not met since there had been no state “determination after a hearing on the merits of a factual issue . . .” (§ 2254(d)), resolving such factual issue (§ 2254(d)(1)) by a fact finding procedure “adequate to afford a full and fair hearing” (§ 2254(d)(2)), adequately developing the material facts (§ 2254(d) (3)), and affording the petitioner a full, fair and adequate hearing (§ 2254(d) (6)).

Appellant contends that the petitioner waived an evidentiary hearing on the issue of the voluntariness of his plea because his counsel failed to file the written motion as directed by the state justice. This point relates more to an unraised question of the exhaustion of state remedies than to the effect of the state court determination upon, or the propriety of, the federal evidentiary hearing in view of § 2254(d). If there were no state hearing on the merits of a factual issue, whether waived or not, a condition for the presumptive correctness of state court findings based on such a hearing would not be satisfied, even though habeas corpus relief in the district court might be barred for failure to exhaust state remedies. But we think the trial court’s determination that there was no such waiver or failure is not clearly erroneous and should stand. Although' the state justice indicated that Oliver’s own lack of cooperation-with his attorney contributed to the latter’s failure to file the written motion, there are indications in the record to the contrary upon which it was within the province of the habeas corpus judge to rely.

Thus, if by appellant’s “incredible” argument is meant that there was insufficient credible evidence of the counsel’s false representations to support the trial court’s findings we reject it. If appellant’s initial statement of the question (p. 2 of appellant’s brief), apparently concerned rather with claimed incredibility of any reliance by petitioner upon the representation of his attorney, is to be taken as the point, it becomes more troublesome.

The petitioner when he entered his plea was not a novice in criminal proceedings, and the evidence suggests that in some ways he was relatively bright. The oral argument in support of the latter version of the contention was that no matter what his attorney may have represented to him he should have known better. Undeniably the claimed deal for the state to waive a number of other indictments in return for his plea of guilty to a single charge involving the service of no time beyond the period of his federal sentence was an exceedingly good one for the petitioner under the circumstances. But for us to say contrary to petitioner’s testimony, the circumstances supporting it, and the findings of the trial court, that in law or in fact he could not have relied upon his attorney’s representation is another thing. We have concluded that the trial court’s contrast of the attorney’s situation with that of the petitioner and the testimony supporting the implicit finding of reliance were not unreasonable, much less incredible, and should stand along with the other factual determinations of the trial court.

In granting the writ Judge Knapp directed “that the relator be discharged unless we can have it retried by the state court within a period of sixty days.” Appellant complains that this limitation would afford insufficient time to prepare for trial, and in the same breath suggests that, by reason of prior delay occasioned by the proceedings thus far, proof of the offense may now be difficult to marshall. It is also suggested that, if the writ stands, the state should at least have the option of resentencing petitioner to the four years which he understood he was to receive, to which his present counsel indicated in oral argument that he would have no objection.

Santobello v. New York, 404 U.S. 257, 92 S.Ct. 495, 30 L.Ed.2d 427 (1971) involved a remand with directions that the state court either allow a petitioner to withdraw his plea and stand trial or grant specific performance of the agreement which had induced the plea. But the present case is not one of a breached prosecutorial promise and a plea induced by that promise, as in Santobello, but rather a false representation by petitioner’s counsel that a promise had been made, and a plea induced by that representation. Under the latter circumstances the district court with our approval in Mosher adopted, 351 F.Supp. at 1111-1112, a solution similar to that suggested by appellant here. Yet there are enough distinctions in the circumstances of the two cases to persuade us to accept here, as was done there, the variant discretion of the court below.

Effective upon the filing of the mandate the stay heretofore granted is vacated and the order of the district court is affirmed.

      . At p. 1348 of 491 F.2d it was stated that “[t]he instant ease is the rare one — unique in this Circuit so far as we know — where after an evidentiary hearing the district court has made a finding based on substantial evidence that the state prisoner has sustained his burden of proving that the circumstances as they existed at the time of the guilty plea, judged by objective standards, United States ex rel. Curtis v. Zelker, supra, 466 F.2d [1092] at 1098, reasonably justified his mistaken impression [emphasis in original] . . . .” But in the present case, on contentions arising and recorded in the state court long before our decision or that of the district court in Mosher was published, we find similar facts are found supporting the grant of habeas corpus by a district court, and based on objective standards reasonably justifying the petitioner’s mistaken impression. In both cases there were multiple indictments pending against the petitioners. In each case the trial judge con-eluded that the petitioner’s assurance to the state court at the time of the acceptance of his plea that no promises had been made to him did not overcome the evidence to the contrary, the trial courts recognizing heretofore unregulated pressures which unhappily but not uncommonly have induced such assurances. See Hilliard v. Beto, 465 F.2d 829 (5th Cir. 1972).

      . Under New York law a class C felony is punishable by an indeterminate term of imprisonment to be fixed by the court but not exceeding fifteen years, a class D felony by such a term not exceeding seven years. Art. 70, Sec. 70.06, New York Penal Code, McKinney’s Consol.Laws, c. 40.

      . In light of the state sentence and upon petitioner’s motion, the execution of the federal sentence was suspended on June 29, 1969, and he was placed on probation for four years to commence upon expiration of the state court sentence.

      . “§ 2254. State custody; remedies in Federal courts

      “(d) In any proceeding instituted in a Federal court by an application for a writ of habeas corpus by a person in custody pursuant to the judgment of a State court, a determination after a hearing on the merits of a factual issue, made by a State court . . . evidenced by a written finding, written opinion, or other reliable and adequate written indicia, shall be presumed to be correct, unless the applicant shall establish or it shall otherwise appear, or the respondent shall admit—
      “(1) that the merits of the factual dispute were not resolved in the State court hearing;
      “(2) that the factfinding procedure employed by the State court was not adequate to afford a full and fair hearing;
      “(3) that the material facts were not adequately developed at the State court hearing; . . . .
      “(6) that the applicant did not receive a full, fair, and adequate hearing in the State court proceeding; . . . .
      And in an evidentiary hearing in the proceeding in the Federal court, when due proof of such factual determination has been made, unless the existence of one or more of the circumstances respectively set forth in paragraphs numbered (1) to (7), inclusive, is shown by the applicant, otherwise appears, or is admitted by the respondent . . . the burden shall rest upon the applicant to establish by convincing evidence that the factual determination by the State court was erroneous. . . . ”

      . LaVallee v. Rose, 410 U.S. 690, 93 S.Ct. 1203, 35 L.Ed.2d 637 (1973); compare United States ex rel. Williams v. LaVallee, 487 F.2d 1006, 1011 (2d Cir. 1973), cert. denied, 416 U.S. 916, 94 S.Ct. 1622, 40 L.Ed.2d 118 (1974).

      . “Now, you mentioned that [the state judge] never ruled on this, and that raised a question of whether it was either waived by [Oliver’s attorney], and although the government and the Attorney General have not raised that question, I have considered it, and I have concluded that there was no waiver before the state courts, and that the circumstances are such that the doctrine of exhaustion of remedies, which, in my view, the Attorney General probably did not raise, would not be appropriate.” The district court in setting the case for an evidentiary hearing had stated theretofore that “petitioner has apparently exhausted his state remedies”. The .appellant at no time has questioned this insofar as the record disclosed.

      . Oliver testified at his resentencing on April 20, 1971, that his attorney had made only one attempt to prepare an affidavit which apparently he desired in support of the motion and that when Oliver declined to sign the first draft and made suggestions for its modification the attorney not only ignored the suggestions and failed to submit the affidavit, but refused to communicate further with him until they met each other in court at the resentencing proceeding. The attorney did not directly refute this testimony but denigrated Oliver’s suggestions and said that “[t]here have been communications and correspondence [from Oliver] that have not immediately been answered but at some subsequent date that communication or correspondence has been incorporated in some sort of response.” These circumstances, and the resolution by the trial judge of debatable issues of fact in favor of, rather than against, the petitioner, distinguish this case from United States ex rel. Callahan v. Follette, 418 F.2d 903 (2d Cir. 1969).

      . Appellant’s restatement of his second point and the argument in support of it found on pp. 20 et seq. of his brief so indicate: “Point II. Petitioner’s plea of guilty was voluntary under all the circumstances in the light of no promise having been made by either the court or the District Attorney and in the light of the incredibility of the alleged promise.”

      . Beyond petitioner’s positive and consistent testimony of his attorney’s representations and of his subjective reliance thereon, there was substantial independent proof. The testimony of petitioner’s mother that the retained attorney in his demands for payments on his fee repeatedly assured her that her son would get no more than four years’ imprisonment, the testimony of another attorney representing petitioner in the federal proceedings to whom the retained attorney stated on two different occasions that he was working in the state cases to get a sentence running concurrently with the federal sentence, petitioner’s attempts to withdraw his plea of guilty beginning even before he was sentenced when he first received an indication from his counsel that the action of the court might not be in accordance with his understanding, and other circumstances shown by the record convince us that the requisite objective support is present in the record and that the trial court’s findings are not clearly erroneous. Buie 52(a), Fed.B. Civ.P. Not without reason it commented:
      “My conclusion is that the defendant and his mother were testifying truthfully . . . and that Mr. Sena [the petitioner’s retained attorney] was not . . . Mr. Sena could never answer a question directly [and] . . . represented to me a frightening picture of hatred and contempt for his client ... I think that the key to Mr. Sena’s conduct was in Mrs. Oliver’s testimony. She said, after retaining him, that she was constantly asking him what was going to happen, and he was constantly asking her for money . . . At which time he would always tell her ‘Never mind. I’m going to get a concurrent sentence for him’, as if he knew.”

      . “2. Whether petitioner’s plea of guilty was voluntary under all of the circumstances when he allegedly pleaded guilty to three unrelated felonies in reliance upon a promise of a four year sentence to run concurrently with an unrelated federal sentence where no promise was ever made by the Court or the District Attorney and where petitioner could not credibly believe that any such promise was made?”

      . “Now, I must say that it is wholly unreasonable for any lawyer to think that he could have obtained a concurrent sentence of four years in this situation in New York County.
      “I base that on my familiarity with how they operate in New York County with a criminal record that this defendant had . . . but ... of course, the defendant is not charged with knowledge of what goes on in the District Attorney’s Office, but Mr. Sena, I believe, would be.
      “Now, also, the second impressive thing on the probabilities is the fact that this distinguishes this case from practically any other that I am aware of, the fact that a defendant might do this or would wait until after he saw what the sentence was, this defendant did not wait until after he saw what the sentence was to express his desire to withdraw his plea. He expressed it immediately after he left, and the first person. that the record shows that he spoke to besides Mr. Sena was the probation officer, and he immediately told the probation officer that he wanted to withdraw his plea.”

      . According to the uncertain record before us the four-year term already would have been substantially served. The present suggestion was not presented to the court below when there would have been more point to it. If the appellee’s guilt is as manifest as appellant has represented it may not be against the public interest for the state, relieved of the bargain foisted upon it by petitioner’s counsel, to endeavor to establish the accountability of petitioner independently of it. In fact the court below cautioned the petitioner against the possibility as a result of trial of a sentence greatly in excess of ten years should the writ be granted and the decision affirmed on appeal; the petitioner stated that he so understood. See also Santobello v. New York, supra, opinion of Mr. Justice Marshall, with whom Mr. Justice Brennan and Mr. Justice Stewart joined, concurring in part and dissenting in part, 404 U.S. at 267, 269.

      . We consider it implicit in the trial court’s order in light of our stay that the 60 day time limit will not commence to run until the filing of our mandate, and that the period of any obstruction of an expeditious trial caused by the unavailability or unreasonable conduct of the petitioner is not to be counted.


author: DONALD RUSSELL, Circuit Judge:

text:
    UNITED STATES of America, Appellee, v. Andrew J. WELEBIR, Appellant.
    No. 73-1994.
    United States Court of Appeals, Fourth Circuit.
    Argued April 2, 1974.
    Decided June 6, 1974.

      Louis Koutoulakos, Arlington, Va., for appellant.
    David H. Hopkins, Asst. U. S. Atty., (Brian P. Gettings, U. S. Atty., on brief), for appellee.
    Before CRAVEN, RUSSELL and ADAMS, Circuit Judges.

       United States Circuit Judge for the Third Circuit, sitting by designation.

   DONALD RUSSELL, Circuit Judge:

The defendant appeals from a conviction under three counts of an indictment charging (1) unlawful manufacture, (2) possession, with intent to distribute, of amphetamines, both in violation of Section 841(a)(1), 21 U.S.C. and (3) of the use of parcel post to carry on an illegal activity in violation of Section 1952, 18 U.S.C. He assigns four grounds of error. We find the assignments of error without merit and affirm.

For his first claim of error, the defendant challenges the validity of the search warrant, on the basis of which the apartment of the defendant was searched and the amphetamine material, which gave rise to the prosecution, seized. The affidavit supporting the search warrant was made by an agent of the Bureau of Narcotics and Dangerous Drugs (hereafter referred to as Bureau). It began with a reference to a telephone order for certain drugs, received by a New Jersey chemical company from a person giving the name of the defendant. The drugs ordered “appeared”, in the opinion of the chemical company, “to be precursors for amphetamine.” For that reason, the chemical company sent a copy of the order to the Bureau for its information. The order was in turn submitted to an identified Bureau chemist, who confirmed that with “the chemicals manifested” on the order for supplies “Methamphetamine (commonly called ‘Speed’) could be manufactured” and fixed the amount that could be manufactured therewith as “approximately one pound or 551 grams of Pure methamphetamine * * even in a primitive laboratory.” The materials ordered were thereafter shipped to the defendant at the address given and a controlled delivery was made by officers of the Bureau. When the delivery was made, a distinct odor of chemicals was detected by the officers making the delivery. A person identifying himself as the defendant accepted delivery. A chemist, identified in the affidavit, on the same day interviewed the Director of the Chemistry Department at American University, where the defendant was a student, and was informed that the defendant had taken numerous chemistry courses at that institution and was “capable of manufacturing illicit drugs”. Finally, a Sergeant in the Special Unit, Arlington County (Virginia) Police Department, who was identified in the affidavit, told a named agent of the Bureau that “a confidential source who has provided reliable information in the past which led to three separate arrests and convictions,” had reported that “Welibir was planning to open and operate a clandestine laboratory for the purpose of manufacturing illicit drugs * *

The defendant argues that this detailed affidavit contained “only conclusions and hypotheses * * * without the factual foundation necessary” to support the issuance of a search warrant.. We do not so construe the affidavit. It is true, it may not have stated facts sufficient to convict the defendant of being engaged in the manufacture of illicit drugs, intended for sale; such is not required under the commands of the Fourth Amendment; it is sufficient that the supporting affidavit, taken as a whole, be sufficiently detailed and specific to warrant a finding of the probability of such activity. United States v. Ventresca (1965) 380 U.S. 102, 107-108, 85 S.Ct. 741, 13 L.Ed.2d 684. Such probability was established by the affidavit in this case. The defendant purchased chemicals of such a type and in such quantities that the chemical company from which he was purchasing such drugs felt called on to advise the Bureau of such purchases, which, by their very nature, were capable of being used to manufacture illicit drugs. The Bureau submitted the purchase order to one of its own expert chemists, who gave the opinion that, with the materials ordered and a few other “simple and easily obtainable chemicals”, methamphetamine “could be manufactured * * * even in a primitive laboratory.” The officers, who made delivery to the defendant at his apartment, detected chemical odors emanating from the apartment, a circumstance indicating the operation of a chemical laboratory in the apartment. This circumstance was given added significance by the information supplied by “a confidential source”, whose reliability was based on prior “reliable information” which he had supplied and which had resulted in three prior convictions. In fact, this “confidential source” stated that the defendant intended to set up a laboratory for the manufacture of “illicit drugs”. This information, from a reliable informant, when coupled with the fact that the defendant had ordered drugs capable of such manufacture and the observation by the officers who made the controlled delivery of the operation in defendant’s apartment of a chemical laboratory, clearly had the indicia of reliability. Considering - all the circumstances recounted in the affidavit “in a common sense and realistic fashion”, as we are required to do under the Fourth Amendment, we find the affidavit sufficient to sustain the issuance of the search warrant in this case.

The defendant challenges, also, the sufficiency of the proof as to the counts both of manufacturing and of possession with intent to distribute. Specifically, he contends that the count charging manufacture fails since the proof established that the “experiment” was not complete and that only “a small amount of amphetamine was found.” But, “[P]roof of manufacturing does not require that the drug actually was produced.” United States v. Moore (6th Cir. 1971) 452 F.2d 569, 573, cert. denied 407 U.S. 910, 92 S.Ct. 2435, 32 L.Ed.2d 684, reh. denied 409 U.S. 899, 93 S.Ct. 101, 34 L.Ed.2d 158. As a matter of fact, though, the evidence for the Government was to the effect that the defendant, in his “experiment” had already manufactured a minimum of 400 doses of amphetamine and that, with the available supplies, it was possible for the defendant, had the process of manufacturing been completed, to have produced 50,000 doses. And when the officers searched the apartment, the defendant’s equipment was, according to the Government’s testimony, “all set up as if a chemical reaction had just been taking place,” and, in the opinion of the Government’s expert, “the manufacture and purification of amphetamine and methamphetamine was taking place” at the time. The Government’s expert witness went further and testified that, based on his analysis of the apparatus set up on the defendant’s apartment, “the chemicals that were present and the product that resulted therefrom * * * nothing else * * * could have come out of the reaction but amphetamine”. It is true, the defendant’s expert differed from this conclusion. But such difference of opinion presents issues for the jury, not for us. “It is not for us to weigh the evidence or to determine the credibility of witnesses. The verdict of a jury must be sustained if there is substantial evidence, taking the view most favorable to the Government, to support it.” Glasser v. United States (1942) 315 U.S. 60, 80, 62 S.Ct. 457, 469, 86 L.Ed. 680; United States v. Sherman (4th Cir. 1970) 421 F.2d 198, 199-200, cert. denied 398 U.S. 914, 90 S.Ct. 1717, 26 L.Ed.2d 78; United States v. Grow (4th Cir. 1968) 394 F.2d 182, 201-202, cert. denied 393 U.S. 840, 89 S.Ct. 118, 21 L.Ed.2d 111. The facts in this case, measured by this standard, were sufficient to support the submission of the issue of manufacturing to the jury.

Equally untenable is the defendant’s attack on the sufficiency of the proof of intent to distribute under the first count of the indictment. Intent is rarely susceptible of direct proof; it is generally to be inferred from the circumstances. In the case of illicit drugs, intent to distribute may in proper circumstances be inferred from the amount in possession. Whether the inference is warranted depends, of course, on the amount in possession. As the Supreme Court stated in Turner v. United States (1970) 396 U.S. 398, 423, 90 S.Ct. 642, 656, 24 L.Ed.2d 610, “a small quantity”, which could as well be "for his (the defendant’s) personal use” as “for sale” will not support the inference; conversely, though, as Turner, also, held if “ ‘it can * * * be said with substantial assurance that the presumed fact [the intent to distribute] is more likely than not to flow from the proved fact on which it is made to depend’” (396 U.S. at pp. 404-405), the inference may be justified. Accordingly, it is a question to be determined on a case-by-case basis whether the quantity of illicit drugs in the particular case is sufficient to establish, absent any other evidence, intent to distribute. United States v. Childs (4th Cir. 1972) 463 F.2d 390, 392, cert. denied 409 U.S. 966, 93 S.Ct. 271, 34 L.Ed.2d 232, reh. denied 409 U.S. 1131, 93 S.Ct. 934, 35 L.Ed.2d 264; United States v. Ortiz (10th Cir. 1971) 445 F.2d 1100, 1104-1105, cert. denied 404 U.S. 993, 92 S.Ct. 541, 30 L.Ed.2d 545, reaffirmed United States v. Henry (10th Cir. 1972) 468 F.2d 892, 893-894; United States v. Moore, supra (452 F.2d at p. 573).

We conclude that the facts in this case are adequate to support an inference, based on the quantity of illicit drugs and the nature of the defendant’s operation, of intent to distribute. The defendant was not engaged in a trifling operation. His experiment was not concerned with a single, small chemical batch nor with manufacture for personal use. He was working with six separate containers, containing substantial quantities of amphetamines in various stages of development. The defense that this was a mere student’s casual experiment lacks plausibility. It is most unlikely that, in a student experiment, one would be converting materials out of which some 50,000 doses of amphetamine could be processed. Compounding in such quantities manifestly points towards distribution. In any event, it was for the jury to determine whether such an operation, conducted with the skill and in the scope of this one, warranted the conclusion that it was being carried on with the intent to distribute. See United States v. Childs, supra (463 F.2d at p. 392); United States v. Moore, supra (452 F.2d at p. 573); United States v. Ortiz, supra (445 F.2d at pp. 1104-1105).

The complaint of the defendant that argument of the District Attorney exceeded proper bounds rests on the reference by the latter, during his closing argument to the jury, to the defendant as a “big peddler”, who was “producing an awful lot of amphetamines to put on the street”. Of course, as the defendant contends, there was no direct proof that the defendant was a “big peddler” or that he intended to distribute “an awful lot of amphetamines”, yet those were inferences that could be legitimately drawn from the testimony. The amount of amphetamines in process of manufacture, if the Government’s estimates are taken, gave rise to an intent to distribute and from that the Government was entitled to argue that the defendant in distributing such quantities, qualified as a “big peddler”.

We do not conclude that the District Attorney’s argument constitutes reversible error. See, United States v. Retolaza (4th Cir. 1968) 398 F.2d 235, cert. denied 393 U.S. 1032, 89 S.Ct. 646, 21 L.Ed.2d 576; United States v. Sawyer (4th Cir. 1965) 347 F.2d 372.

Defendant's final contention is that he could not be convicted of both manufacturing and of possession with intent to distribute, “since ‘manufacture’ embraces and includes possession.” The two charges, however, are separate offenses, require different proof, and may support separate verdicts. See United States v. Moore, supra (452 F.2d 569) and United States v. Ortiz, supra (445 F.2d 1100); cf., also, United States v. Richardson (8th Cir. 1973) 477 F.2d 1280, 1283, cert. denied 414 U.S. 843, 94 S.Ct. 104, 38 L.Ed.2d 82; United States v. Scales (6th Cir. 1972) 464 F.2d 371, 373.

The conviction is accordingly affirmed.

      . The indictment contained a fourth count (i. e., the use of a telephone in facilitating manufacture of an illicit drug in violation of 21 U.S.C. § 841(a)(1)) but this count was dismissed on motion.

      . It is well settled that an affiant, seeking a search warrant, can base his information on information in turn supplied him, as this information, by fellow officers. United States v. Ventresca, supra (380 U.S. 102, 85 S.Ct. 741, 13 L.Ed.2d 684); United States v. Various Gambling Devices (5th Cir. 1973) 478 F.2d 1194; United States v. Steed (9th Cir. 1972) 465 F.2d 1310, cert. denied 409 U.S. 1078, 93 S.Ct. 697, 34 L.Ed.2d 667. Similarly, hearsay, even “second hearsay”, may provide a legal basis for a search warrant. Thus, in United States v. McCoy (10th Cir. 1973) 478 F.2d 176, 179, cert. denied 414 U.S. 828, 94 S.Ct. 53, 38 L.Ed.2d 62, all of the statements of the affiant, who secured the search warrant “were based on information relayed to him by fellow FBI agents who had in turn acquired their information from others interviewed in the course of their particular investigative endeavors.” In sustaining the sufficiency of the affidavit, the Court said that “when a magistrate receives an affidavit which concerns hearsay on hearsay, he need not summarily reject this double hearsay information, but is rather called on to evaluate such information as well as all other information in the affidavit in order to determine whether the informant gathered his information in a reliable way and from reliable sources.” See, also, United States v. Wilson (7th Cir. 1973) 479 F.2d 936, 941.

      . Cf., United States v. Sultan (2d Cir. 1972) 463 F.2d 1066, 1068-1069:
      “ * * * A recitation that an unnamed informant has previously supplied accurate information is sufficient to justify reliance on the informant’s story.”

      . United States v. Ventresca, supra (380 U.S. at 108).

      . The Government attempted to prove “the going price of amphetamine dosages on the illegal market” in order “to show that the amounts here were more than [for] personal use.” The District Court refused to admit the evidence. Cf., United States v. Mather (5th Cir. 1972) 465 F.2d 1035, 1037, cert. denied 409 U.S. 1085, 93 S.Ct. 685, 34 L.Ed.2d 672.

      . Cf., United States v. Cohen (2d Cir. 1949) 177 F.2d 523, 526-528, cert. denied 339 U.S. 914, 70 S.Ct. 568, 94 L.Ed. 1340, where the Court, in upholding the District Attorney in his characterization of the defendant as a “pimp”, stated that the conviction would be overturned on the basis of a characterization used by an attorney in his argument “only where the invective is so palpably improper as to have been clearly prejudicial.”