[316 U.S. 129, 130] Mr. Osmond K. Fraenkel, of New York City, for petitioner shulman.
Mr. Jacob W. Friedman, of New York City for petitioners Goldman.
Mr. Charles Fahy, Sol. Gen., for respondent.
Mr. Justice ROBERTS delivered the opinion of the Court.
The petitioners and another were indicted for conspiracy1 to violate 29, sub. b(5) of the Bankruptcy Act2 by receiving, or attempting to obtain, money for acting, or forbearing to act, in a bankruptcy proceeding. They were convicted and sentenced and the judgments were affirmed by the Circuit Court of Appeals. 3 The facts are fully stated in the opinion below and we shall advert only to those essential to an understanding of the questions open in this court.
The petitioners were lawyers. One of them, Martin Goldman, approached Hoffman, the attorney representing [316 U.S. 129, 131] an assignee for the benefit of creditors, with the proposition that the assignee sell the assets in bulk for an ostensible price which would net the creditors a certain dividend, but in fact at a secret greater price, and that Hoffman and the petitioners should divide the difference between them. Hoffman refused. Shulman, one of the petitioners, then filed an involuntary petition in bankruptcy against the assignor in such form that it could be dismissed on motion and without notice, and obtained a stay of the assignee's sale. 'The bankruptcy court refused to revoke the stay and Shulman again approached Hoffman stating that, if he agreed to the proposed arrangement, the bankruptcy petition could be dismissed and the plan consummated. Hoffman said he would agree, but he went at once to the referee and disclosed the scheme. A federal investigator was consulted and it was arranged that Hoffman should continue to negotiate with the petitioners. He did so. Numerous conferences were had and the necessary papers drawn and steps taken. Success was frustrated only by the refusal of a creditor to release for the offered percentage of his claim.
Meantime, two federal agents, with the assistance of the building superintendent, obtained access at night to Shulman's office and to the adjoining one and installed a listening apparatus in a small aperture in the partition wall with a wire to be attached to earphones extending into the adjoining office. This was for the purpose of overhearing a conference with Hoffman set for the following afternoon. The next afternoon, one of the agents returned to the adjoining room with two others and a stenographer. They connected the earphones to the apparatus but it would not work. They had with them another device, a detectaphone having a receiver so delicate as, when placed against the partition wall, to pick up sound waves originating in Shulman's office, and means for amplifying and hearing them. With this [316 U.S. 129, 132] the agents overheard, and the stenographer transcribed, portions of conversations between Hoffman, Shulman, and Martin Goldman on several occasions, and also heard what Shulman said when talking over the telephone from his office.
Before the trial Shulman learned the facts and made a motion, in which the other petitioners joined, to suppress the evidence thus obtained. A preliminary hearing was had and the motion was denied. At the trial the evidence was admitted over objection that its receipt violated the Fourth Amendment of the Constitution and, as respects Shulman's talk into the telephone receiver, violated also 605 of the Federal Communications Act.