The opinion of the court was delivered by: DUNCAN
The defendants, Consolidated Coal Company (hereinafter "Consol") and eight of its agents and employees
are variously charged in a 172-count indictment with conspiring to defraud the government and to violate the Federal Coal Mine Health and Safety Act in violation of 18 U.S.C. § 371;
with knowingly making false statements and representations in "mine data cards" filed with the Department of the Interior in violation of 30 U.S.C. § 819(d);
with willfully violating specified mandatory health standards in violation of 30 U.S.C. § 819(b);
and with knowingly authorizing, ordering, and carrying out violations of the mandatory health standards by Consol in violation of 30 U.S.C. § 819(c).
On September 12, 1975, the defendants entered pleas of not guilty to all counts; thereafter, all but one of these defendants
filed motions to dismiss as to some or all of the counts relating to them. All of the various contentions raised in these motions are discussed hereinbelow.
I. Conspiracy Question: Can A Corporation Be Charged and Convicted of Conspiring Solely with Its Own Employees?
Counts I and II of the indictment charge the defendants with violations of the conspiracy statute as set forth in 18 U.S.C. § 371. Count I alleges a conspiracy to defraud the United States of its right to have the dust sampling program administered in accordance with the Federal Coal Mine Health and Safety Act, specifically with the provisions of sections 814(i) and 842 of Title 30, United States Code, and the rules and regulations thereunder. Count II alleges that defendants conspired to violate 30 U.S.C. §§ 819(b) and 819(d). In each count it is alleged that the individual defendants were employees of Consol at the time of their participation in the conspiracy. Consol submits that a corporation may not be charged or convicted of conspiring solely with its own employees. In support of its contention the company cites a host of civil conspiracy cases involving antitrust actions under §§ 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1 and 2, and several cases alleging conspiracies to cause a breach of a contract. Although this Court is willing to recognize for purposes of this motion a general principle that a corporation cannot conspire with its officers or agents to violate antitrust laws, I believe that this principle arises from the restraint of trade concept of the Sherman Act and consequently that these civil Sherman Act cases are inapposite to the case at bar. Also inapplicable are civil cases involving alleged conspiracies to induce a breach of contract. As Mr. Justice Harlan observed in his concurring opinion in United States v. Wise, 370 U.S. 405, 417, 82 S. Ct. 1354, 1362, 8 L. Ed. 2d 590 (1962):
[The] fiction of corporate entity, operative to protect officers from contract liability, had never been applied as a shield against criminal prosecutions . . . .
Finally, the Court does not believe that United States v. Carroll, 144 F. Supp. 939 (S.D.N.Y.1956), a criminal case also cited by Consol, in which the court refused to find a conspiracy between a corporate defendant and an individual defendant, is determinative. Rather than espousing a general rule that corporations cannot conspire with its employees, the court in Carroll appeared to make a narrow finding based on the particular facts involved. In Carroll a corporation, Sheba Bracelets, Inc., was charged with conspiring with its agent, Robert Carroll, to use and acquire gold so as to violate the federal gold laws. The court noted that no evidence was presented regarding the ownership of Sheba, but it did find that it was dominated by Carroll. Although in his ruling District Judge Palmieri discussed civil antitrust conspiracy cases, the gist of his decision seems to be his unwillingness, under the facts presented, to "over-extend the fiction of corporate personality." United States v. Carroll, supra at 941. Judge Palmieri explained his decision thusly:
The purpose behind not merging conspiracy into a completed crime, as happens with attempts, is separately to penalize and to deter criminal organization, an evil quite apart from the substantive delicts which more likely than not result from such organization. This purpose is served by holding combinations of corporations and often combinations of directors of one corporation, guilty of conspiracy. . . . However, the policy does not apply when one man uses a corporate form to carry out his crime. There is no organization and no one other than the sole criminal to deter or punish. In effect, a man would be more severely punished if he chose to commit his crime by using a corporate form than he would be if he committed it through another business device.
I conclude that the Carroll decision must be read in light of its facts and limited to them.
In researching this issue the Court did not find any case which analyzed the precise question presented herein. However, some indication as to a proper outcome can be had by implication from cases dealing with criminal conspiracies. In United States v. Wise, 370 U.S. 405, 82 S. Ct. 1354, 8 L. Ed. 2d 590 (1962), a corporation and one of its officers were indicted for engaging in a conspiracy to eliminate price competition in the sale of milk in the Kansas City area in violation of § 1 of the Sherman Act. The Supreme Court considered the question of whether a corporate officer could be prosecuted along with the corporation when he is acting solely in his capacity as an officer, director or agent of the corporation. In answering in the affirmative, the Court stressed the language of § 1 which imposes criminal sanctions upon "every person"; a corporate officer remains a person within the statutory language even if his acts are also chargeable to his corporation. Moreover, it is clear that the term "person" within the meaning of 18 U.S.C. § 371 also includes corporations.
In Alamo Fence Company of Houston v. United States, 240 F.2d 179 (5th Cir. 1957) a corporation and various of its officers and employees were charged with a conspiracy in violation of § 371 and with the making of false statements to the Department of Housing and Urban Development. In considering the applicability of these statutes to a corporation which had subsequently been dissolved, the court stated:
No contention is made, or can reasonably be made, that the federal statutes involved are not directed against corporate misconduct. " Whoever " commits the inhibited acts is covered by Section 1010, while Section 371 refers to a conspiracy of "two or more persons." The context of neither statute indicates any meaning other than that a "corporation" is included in accordance with 1 U.S.C.A. § 1.
Finally, although not discussing the issue presented herein, a number of cases have implicitly recognized that a corporation can be prosecuted for conspiring with its corporate personnel. See e.g., Nye & Nissen v. United States, 336 U.S. 613, 69 S. Ct. 766, 93 L. Ed. 919 (1949); Baker v. United States, 393 F.2d 604 (9th Cir. 1968); United States v. Bridell, 180 F. Supp. 268 (N.D.Ill.1960); United States v. Kemmel, 160 F. Supp. 718 (M.D.Pa.1958).
Obviously, a corporation is within the statutory language of "person" and can operate only through its agents. However, employment alone by a corporation does not so merge the employee's mind and being with that of the corporation so that one person's cognition remains rather than more than one. When separate individual judgments and decisions are capable of being made by both a corporation and one or more of its employees, there is a vast dissimilarity to the facts of Carroll in which one man used the corporate form to commit a criminal act. The Court concludes then that a corporation can be charged with conspiring with its corporate personnel. The motion of Consol to dismiss on this ground is therefore denied.
II. Whether a Violation of 30 U.S.C. § 819(d) Has Been Properly Alleged in the Indictment.
attack counts 3-13 and 172-174 of the indictment which charges them with violations of 30 U.S.C. § 819(d) for knowingly making false statements and representations in mine data cards. This section provides that:
whoever knowingly makes any false statement, representation, or certification in any application, record, report, plan or other document filed or required to be maintained pursuant to this chapter or any order or decision issued under this chapter shall, upon conviction, be punished by a fine of not more than ...