Finishing Cases Undertaken in Private Practice
Hicke
Okay, so now, where we left off before was, you were appointed to the district court, and you had a hard time making up your
mind, but you finally did make up your mind and broke the news to your wife. So what we need to start with, I think, is what
were your early impressions, and what were your first responsibilities, and what happened as you came on the court?
Poole
I was nominated by Gerald Ford, and I think that that was sometime in July of 1976.
Hicke
Yes, that's what I have.
Poole
Then I had the problem, actually, of having to unload a lot of the cases that I had. It was quite a problem. We had one case
in which my clients were lawyers. They had a tax shelter practice, and it was one of the most complicated schemes ever heard
of. Their clients were mainly people who had high incomes. They had movie people and prominent professionals, doctors, lawyers,
who had money and wanted to invest it. There was a lawyer down at Los Gatos who was the genius behind this, Harry Margolis.
He's dead now. His practice was devoted to these schemes of investment, and these were a part of the offshore trusts—those
things were in the news for a while—and these were in the Caribbean countries and the trusts were there. The only way you
could understand how the money went was to draw it [schematically]. He had blackboards as long as from that window to that
door [demonstrates].
Hicke
Twenty-five feet or something like that.
Poole
He would draw what happened to it at different places and all that. At the time he contacted me, he had pending in the United
States Tax Court approximately 350 tax cases. Not all of them
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were in this, because some of them were routine tax cases. He had this thing, and the government was frustrated, because in
the tax court, Harry would win some and he'd lose some.
Hicke
Were these fraud?
Poole
Well, that's what the government was saying. I never knew, because I never really knew how it worked. The government got tired
of having only indifferent success in the tax court, and they decided this really was a big fraud, let's treat it like a criminal
fraud, so they indicted him. Before they indicted him, they were calling a lot of his clients to the grand jury. The grand
jury was sitting up in San Francisco, but they were calling people from Hollywood, producers of pictures, and trying to get
them to give them statements.
That's how I came into the picture. Harry came up to see me and asked me if I would represent some of these people who were
going to be called before the grand jury. So we talked about it, and I said I would. It sounded kind of interesting to me.
This was before I was nominated, but it was strung out well after the nomination. The two assistant United States attorneys
who were working that case were people whom I had hired when I was the head of the office. As I said to one of them, "What
are you doing here? I didn't hire you to be a trial lawyer. I would never let you get into a court if you had to do this sort
of thing." [Laughter]
Anyhow, I met with these witnesses. I went down to a couple of places in Southern California and met with them. The first
one that I remember meeting with—it wasn't the first one, but I remember he stands out. He was a plastic surgeon, a very successful,
very highly skilled plastic surgeon. First I met with his certified public accountants. We had a conference, the two accountants
and I, and they were anxious that I not— They said he didn't even know what happened, how the thing happened. They had gotten
him because he and his wife had gotten a loan from Security National Bank of $675,000, and Harry had invested that. "If he
is going to go to the grand jury, I want to know what is the state of his knowledge, but I don't want to be feeding stuff
to him." I met with his accountants first and they told me a lot of things about this loan. They knew what it was. So he came
in, and he had on his white jacket and he had the thing around his neck, and the kind of turban they wear. We started talking.
They introduced me to him.
Hicke
So he walks in all dressed for his work.
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Poole
He walks in with all this stuff. We got introduced, and so I said to him, "The government wants to know what happened to this
$675,000. What can you tell me?" He said, "What can you tell me?" And I said, "I don't know anything. I'm looking for wisdom
now. I thought maybe you might be able to tell me what you do know about it." He remembered the loan. It didn't seem like
it figured too importantly.
Hicke
Just a mere six hundred whatever.
Poole
I noticed he was looking at me like this [demonstrates].
Hicke
Staring and really looking you over.
Poole
Yes, and so then what he did was he came over to me and did like this [demonstrates].
Hicke
Put his hand up?
Poole
He said, "You know what? I could make you beautiful." [Laughter] I think he had three or four floors. He owned the building.
It was in—not Hollywood—it was right outside there, near where Ronald Reagan has his home now, Bel Air, something like that.
So I went and talked with him, and he was very nervous about the idea of going to the grand jury. I went back to San Francisco
and I talked to the Department of Justice people, and I said, "This is going to be a long process, because I'm going to tell
you, when he starts answering your questions, you're going to not believe him. I am not going to tell you whether you should
or shouldn't, but I'm going to tell you this: I can walk out of the room, and he'll give you whatever the answer—he knows
some things, and he doesn't know some other things. I have told him that when he's asked a question that he can answer, he
has a choice of either answering it or refusing to answer. But whatever he does, he's to tell you the truth as he knows it.
He's not a lawyer, and I told him not to try to be a lawyer."
I worked out a plan with the assistant U.S. attorney that instead of going to the grand jury with him, we would take the deposition
in their office. I'd be present. I wasn't going to say anything, but if he wanted to consult with me, I would do that. I said,
"You'll save a whole lot of time." They agreed, which I thought was some indication of their trust that I wasn't sitting there
scheming with a whole lot of lies. They got nothing from him.
Then there were a couple of other doctors. They were from somewhere around San Jose and down the peninsula. I got them to
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do the same treatment with them. Instead of going to the grand jury, they came and talked with them. It went faster than it
would have before the grand jury, because their instructions from me would be when they were asked a question, "When you're
in doubt about the answer, you ask them to let you come out and consult with me. I'll be in the room next to you." That takes
a lot of time. When they agreed to do this by way of a deposition, it did go faster.
Eventually, the grand jury indicated three people. They indicated Harry and a couple of other lawyers. Then Harry asked if
I would represent his chief. He had six CPAs in his office, and he asked me if I would represent the chief CPA, and I agreed
to do so.
It was after that that the nomination came out. So here I was. I had been nominated three months and I still hadn't taken
the oath. I had some other cases that I was having difficulty getting out of the way. I did a lot of tax cases. What was happening
was that the district judges over there at the Federal Building were embarrassed to have me coming in and arguing cases in
their chambers because I was soon going to be one of them. [Laughter] It was something.
As part of that case, the government was taking depositions all over the Caribbean, and we had depositions scheduled for Brussels
and Paris. The government came into the court with a motion. Ordinarily you tell them who's going to be the deponent, whose
deposition you're going to take. They had this affidavit why they shouldn't be required to disclose it. They came into the
courtroom of Judge William Orrick. Bill Orrick and I at that time had been friends for more than twenty years, but he was
no nonsense in the courtroom. So they filed this motion to suppress some of the evidence, or not let us have it at this time,
so it wouldn't have to be disclosed until there was a trial. I said, "Your Honor, how can this be? They want us to go from
here to Europe to take a deposition from someone whose name we don't even know. To do that puts us at a manifest disadvantage.
We've got one hand tied now, maybe both hands tied behind us, because I don't know what they've put in that piece of paper
they've given you. But if they're indicating there is any threat coming through me, then you've got some liars in this courtroom."
So we argued and argued and argued, and he finally said he was going to rule against us. He wasn't going to let us see it.
I said, "You mean you're going to tell us to go across the sea, when we don't know where we're going or who it is? We don't
have any means then. But some of this is going to delay this court for a long time. Because, Your Honor, if you do that, we're
going to be
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delayed a long time in getting this case to trial." He said, "I think I can push it on a little bit." I said, "Maybe you can,
and maybe you can't. But in any event, it is not going to be very accommodating." So finally he looked at me—there were a
lot of people in the courtroom then—he said, "Mr. Poole, when you get to be a judge on this court, you'll do it your way,
but I'm going to do mine my way. And my way may not be yours." I said, "You can bet your boots it's not." [Laughter] His name
is on my admission to the Supreme Court.
Hicke
Is it?
Poole
Sure.
##
[Searches unsuccessfully for his admission papers] Anyhow, I was admitted to the U.S. Supreme Court in 1961 and that was in
the early days of the Kennedy administration. Bill Orrick was then an assistant attorney general, and it was on his motion
that I was admitted by Chief Justice Earl Warren.
So it was getting increasingly difficult for me to be able to go into a curtroom without some embarrassment, and I could see
that I couldn't stay with this case. I finally got a lawyer from down in Southern California who had done some of this kind
of work, whom I knew to be very sharp and very bright. Before I gave up the practice, [William] Bill Schwarzer and [William]
Bill Ingram—Schwarzer was a lawyer with McCutchen, Doyle, Brown & Enersen, Bill Ingram was on the Superior Court in San Jose—and
I were nominated. I think I told you that their two names were sent in at first, but they didn't send mine in. The Ford people
were concerned that this wouldn't help them out in the Republican primary as against Ronald Reagan, who was threatening to
run.
Finally I realized that the time was up and I had to do it. I got somebody to take my place, and we went into Stanley Weigel's
chambers. The lawyer who was going to take my place came and we had an affidavit. He explained that he would require that
the— They had these spurious trial dates. They weren't going to go out on that at that time. But he said he would require
thirty days before he could do it because he was just beginning a case involving an engineering defect down in Ventura County.
Stanley—Judge Weigel—didn't believe that he had this case.
I said, "Your Honor, I know that he has a case because it was upon my reference that he became associated with the case. I
know the case to be a difficult one. I couldn't do it because obviously I don't have that much time." So Stanley was sort
of
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saying, Okay, all right. For whatever reason it was, I don't know, I think this lawyer sort of rubbed him the wrong way, because
he is one of these persons who speaks clearly, articulately, and loud, and I think Stanley didn't like that. He said to him,
"I can see, sir, that you are striving for some kind of advantage." Well, the ball left my court and went into the other court
at that point. This fellow stood up and he said, "Your Honor, you're a judge of this court and I respect you. I know you don't
know me, but you have no right to presume that I am not responsible in my representation or that I seek some untoward advantage.
I haven't given you any cause for saying that, and you have no business saying it." I thought Stanley would have liked to
punch him in the mouth [inaudible], but he took the paper.
It was a substitution, and we had prepared the paper with a paragraph giving a thirty-day continuance on the assumption that
Stanley was going to say all right. He didn't want to try the case. He crossed that out and signed it. We went straight down
the hall to Bob Peckham, who was then the chief judge. I said, "I don't know why he did that. He didn't need to." Anyhow,
Bob took care of it.
I was representing the chief CPA, but they split them off. Three lawyers went to trial on it: Harry, and a lawyer from Oakland
who was associated with him, and a woman lawyer who was from Southern California. They tried this case, let me tell you. They
tried this case. It was Ingram's first long federal case. It must have gone on for six, maybe seven weeks. The funny thing
about it was they had given us discovery. I got eighty-four boxes of machine records. They brought them to the Federal Building
and they put them in an empty room there, and we hired a couple of trucks and took them down to Harry Margolis's office. I
said to the assistant U.S. attorney, "You still don't get it do you? You're going to try a civil tax case and the jury isn't
going to understand a word. We're going to defend a criminal case. You watch."
So they went to trial, and after all that period of time, the jury acquitted the woman lawyer and the man lawyer. They disagreed
on Harry. They had a hung jury on him. So these two were out. My erstwhile client, the chief CPA, never went to trial. They
tried Harry alone and he was acquitted. No jury in the world could understand what they were talking about, because you had
to be able to show that there had been a fraud. To show that, you'd have to show how the money was invested and reinvested.
That's what we meant by the money is traveling. I to this day don't know how it happened. And I wasn't even interested in
how it happened. I certainly had some fun trying the case though. Bob assigned that case to Bill Ingram. So Bill, having
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gone through his invested jurors and all, called me one day. He said, "Did you ever know what this case was about?" I said,
"Not much, Bill. But I figured that I wasn't alone. I didn't think the government knew much." He said, "They had no idea where
they were." On the second trial, he was acquitted. That's how that case ended.
Do you remember there was an outfit called EST was it?
Hicke
Yes, EST [Erhard Seminars Training].
Poole
The head of that [Werner Erhard] was one of the clients. Yes, he was one of them, and for a while, he was the one whom I was
advising. They had lots of money.
Hicke
That was a big transition you had to make.
Poole
I remember I had a routine case that involved a husband and wife who were tax preparers, and they obviously were preparing
tax returns that they had no business believing were correct. The husband and wife both agreed to either a plea of no contest
or to plead guilty. When it got down to it, finally, I worked it out before Judge [Alfonso] Zirpoli that the wife would plead
to, I think it's making a false statement to the government, and the husband would plead to two counts of filing a tax return
not believing that every statement or allegation in there was true.
Hicke
So it's the responsibility of the preparer to ascertain the proof?
Poole
Yes. And then the last day I was going to be in any court on that side of the desk, he had thought about it and he didn't
think he wanted to make that plea. So, I brought in Clinton White, who is now a justice of the California Court of Appeal,
First Appellate District. I guess Clint's the presiding justice of one of those divisions over there. He was a good trial
lawyer, and he agreed to take the case. Zirpoli gave him the same easy sentence he would have given if I'd been there.