This section contains the nature of the case and procedural background.

The indictment charges a single conspiracy in a single count. Ten overt acts are specified. The Government (P) alleged and sought to establish that all of the defendants and other unidentified persons conspired together to dispose of two carloads, each consisting of about 2,000 cases, of Old Mr. Boston Rocking Chair Whiskey at over the ceiling wholesale prices. The whiskey was shipped to the Francisco Distributing Company, in San Francisco. Goldsmith is the sole owner of that business and held a wholesale liquor dealer's basic permit, as required by federal law. Weiss, his former partner, was sales manager for the business. Feigenbaum operated the Sunset Drugstore in San Francisco. Blumenthal owned and operated the Sportorium, a sporting goods, and pawnshop in the same city. Abel either owned or worked in a jewelry store in Vallejo, California. None of the last three was connected with Francisco in any way, each had part in arranging sales and deliveries of portions of these two shipments to purchasers. These were tavern owners in San Francisco and nearby towns such as Vallejo, Santa Rosa, Livermore, Cottonwood, and El Cerrito. Proof of the activities of Feigenbaum, Blumenthal, and Abel was made largely by the testimony of the various tavern keepers with whom they respectively dealt. Legal title was taken in Francisco's name, and some of the whiskey was delivered directly to tavern keepers who previously had arranged for purchases in lots varying from 25 to 200 cases. The remainder was placed in storage and delivered by the warehouse to various purchasers holding invoices issued by Francisco on orders given by Weiss. The cost to Francisco was $21.97 a case, the wholesale ceiling price was $25.27, and Francisco received, by check of the purchasing tavern keepers, $24.50 for each case sold. There was thus left to it a margin above cost of $2.53 on each case, out of which were to come storage charges, if any, and legitimate net profit. P proved that, in connection with each sale, the purchaser had paid to the selling intermediary, an additional sum in cash amounting roughly to from $30 to $40 per case. The total cost was from $55 to $65 per case. In many of the transactions, Blumenthal, Feigenbaum, or Abel were identified as the salesman or intermediary. It was also shown that they did not know each other. Blumenthal, Feigenbaum, and Abel were found guilty. They appealed arguing that there were two conspiracies one between the seller, and the second between Weiss and Goldsmith and Blumenthal, Feigenbaum, and Abel. The Supreme Court granted certiorari.

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