United States v. Molasky, 118 F.2d 128 (7th Cir. 1941)

The five appellants, William Molasky, James M. Ragen, James M. Ragen, Jr., Lester A. Kruse and Arnold W. Kruse, appealed “from judgments of conviction entered September 12, 1940.” The indictment “was returned August 22, 1939” and charged them, “together with Moses L. Annenberg, Jules Taylor and Herbert S. Kamin, and the Consensus Publishing Company,” with wilfully attempting to evade the federal tax on the corporation’s income for 1933 to 1936, and with conspiracy for 1929 to 1936. The opinion records: “Prior to trial, the defendants Annenberg, Taylor and Kamin were dismissed as defendants.”

As the court summarizes the indictment, it charged that Consensus “was engaged in the business of printing and selling ‘Run Down Sheets’ to a class of persons known as ‘Bookmakers’,” with offices in St. Louis and Cincinnati, and that its returns deducted as “commissions” what were in truth distributions of profit. Judge Major’s opinion for the court held the instructions to the jury erroneous: “the judgments must be and are hereby reversed and the cause remanded.” Judge Kerner dissented in part, saying the judgment as to Ragen, Sr. and the two Kruses “should be affirmed.”

The opinion is headed No. 7462-6; rehearing was denied on March 18, 1941 and certiorari granted on June 2, 1941. In United States v. Ragen the Supreme Court reversed this judgment as to Ragen, Sr. and the Kruses. This opinion is the reported appellate record of the August 1939 Consensus indictment. It says nothing about the outcome of Annenberg’s own case.