UNITED STATES v. COOPER et al.

UNITED STATES v. COOPER et al. On April 13, 1922 the two sons of Augustin A. COOPER were arrested at their offices. They were later released after posting bond of $5,000 each. Also charged was their sister Katheryn J. Cooper. The charges were that Austin A. Cooper had unpaid income taxes from 1918-1920 for a total of $56,300.80; Austin A. Cooper Inc. for $600,86; and A. A. Cooper Wagon & Buggy Company for $72,280.97. Over the same years, William F. Cooper had unpaid taxes of $27,747.78 and Katheryn Cooper owed $12.367.15. Under the tax laws, 50% would be added to the total amount due if it were proved that there was evasion by fraud. (1)

On June 1, 1923 the jury returned its verdict in a trial lasting approximately four weeks involving over one hundred witnesses in Waterloo, Iowa against Austin A. Cooper and Wm. F. Cooper, The charges against them were that:

    1) The A. A. Cooper Wagon and Buggy Company, during the tax year 1918, had a
       gross income which, after allowing all deductions and credits permitted by
       law, left new income upon which income and excess profits taxes should be
       computed.
    2) That the defendants during the period they were alleged in said count to
       have conspired and confederated together, knew or believed that said A. A.
       Cooper Wagon and Buggy Company had such met income on which income and
       excess profits taxes should have been computed.
    3) That the defendants at or during the period of time charged in said count
       of the indictment, conspired together, as alleged, to defraud the United
       States out of such taxes by6 making or causing to be made a false and
       incorrect income and excess profits tax return for said taxable year. 

The verdict carried with it a fine of $10,000 or two years in the penitentiary, or both.

The case was front page news for weeks in Dubuque. According to the TELEGRAPH HERALD, the case cost the government approximately $50,000. There were exactly 1,880 exhibits in the case including books, ledgers, journals, bank drafts, checks, check stubs and many copies of various records. Nine attorneys were involved in the case with four representing the government and five for the defense. Records showed that 115 witnesses were called from thirteen different states. All the jurors were either active or retired farmers and had never made out an income tax report without help from their bankers or attorneys.

At the end of the trial, officials in the income tax department and revenue officers of the state declared that the verdict in the Cooper case would have nation-wide effect. According the the Telegraph Herald these officials felt that a "not guilty" verdict would have 'endangered" tax laws and excess profits tax laws all over the United States.

The jury found the men guilty. (2) On June 28, 1923 Federal Judge George C. Scott overruled their plea for a new trial based on seventy-eight reasons presented by the defense. Judge Scott fined each man $10,000 and one-half of the court costs. (3)

The Coopers appealed the verdict in the case of COOPER et al. v. UNITED STATES

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Source:

1. "Cooper Heirs Indicted on Many Counts," Telegraph Herald, April 13, 1922, p. 2

2. "Coopers Found Guilty by U. S. Jury Thursday," Telegraph Herald, June 1, 1923, p. 1

3. "Judge Scott Orders Costs Divided 50-50." Telegraph Herald, June 28, 1923, p. 1

Circuit Court of Appeals, Eighth Circuit. COOPER v. UNITED STATES 9 F.2d 216 (8th Cir. 1925) Online: https://casetext.com/case/cooper-v-united-states-25