The Associated Press published a story on Wednesday about the legal fight over Izzy Switt's cache of 1933 double eagles which resumed on Thursday.
A jeweler's heirs with a cache of rare $20 gold coins will fight for the right to keep them when they square off in court this week against the U.S. Treasury.
Treasury officials charge that the never-circulated "double eagles" were stolen from the U.S. Mint in Philadelphia in 1933. They could be worth $80 million or more, given that one sold for nearly $7.6 million in 2002.
The coins come from a batch that were struck but melted down after President Franklin D. Roosevelt took the country off the gold standard in 1933.
Two were preserved for the Smithsonian Institute. But a handful more mysteriously got out.
The daughter and grandsons of Israel Switt, a jeweler and scrap metal dealer on nearby Jeweler's Row, say they discovered 10 of them in his bank deposit box in 2003.
Joan Langbord of Philadelphia and her sons went to the U.S. Treasury to authenticate the coins, but the government instead seized them. Authorities noted that the box was rented six years after Switt died in 1990, and that the family never paid inheritance taxes on them.
What's more, the Secret Service has long believed Switt and a corrupt cashier at the Mint were somehow involved in the double-eagle breach.
"A thief cannot convey good title to stolen property," Assistant U.S. Attorney Joel M. Sweet wrote.
Switt had been investigated at least twice by 1944 over his coin holdings.
In 1937, U.S. officials seized nearly 100 pre-1933 double eagles from him as he prepared to board a train to Baltimore to meet with a coin dealer. Switt said he knew it was illegal to possess the gold coins, and said he had eventually planned to surrender them, according to a ruling issued by the trial judge this week.
In 1944, the Secret Service traced 10 separate double eagle coins that had surfaced to Switt. He acknowledged selling nine of them, but said he did not recall how he had gotten them. The statute of limitations prevented authorities from prosecuting Switt.
However, his license to deal scrap gold, which sometimes took him to the Mint, was revoked.
U.S. District Judge Legrome Davis will allow that evidence in, despite the family's efforts to block it.
"The documents appropriately go to Switt's knowledge of the repercussions from breaking the gold laws and provide evidence of a motive to conceal his possession of the ten 1933 Double Eagles presently at issue," Judge Legrome Davis wrote.
The trial is expected to last two to three weeks.
"What the Langbords are trying to say here is it's not clear what happened, that there's at least a possibility the coins were just exchanged for ounces of gold," said Armen R. Vartien, general counsel of the Professional Numismatists Guild.
"The records are incomplete, inconclusive," he said. "No one can really know what happened, and none of the people involved are alive to tell (the tale)."
To read the complete article, see:
Pennsylvania Family Fights United States Treasury Over Rare 1933 Gold Coins
On Friday The New York Times had their own story. Thanks to Werner Mayer for sending this in.
Who owns 10 exceedingly rare American gold coins from 1933?
In a case that began on Thursday, jurors are getting an unusual lesson in Depression-era history, and will ultimately decide whether Mr. Switt was merely "colorful," as a lawyer for the family described him, or a thief.
Each side explained in opening arguments that, for all of the history and complexities of 1930s Mint procedures and records to come, the case is quite simple. They disagreed, however, about what the simple point of the case was.
Assistant United States Attorney Jacqueline Romero, presenting the government's case, told jurors, "You are going to hear a remarkable and intriguing story about gold coins that were stolen from the U.S. Mint."
"Israel Switt was somehow involved" in the theft, she said, probably with the help of a corrupt cashier at the Philadelphia Mint. The government had linked Mr. Switt to every double eagle that had emerged over the decades, she said, including 10 tracked down in the 1940s and one sold with the agreement of the government by a dealer, Stephen Fenton, in 2002 for $7.6 million. That sale was based on a government mistake, she said; these coins would not get the same dispensation.
The government will prove, she pledged, that the heirs knew that the goods were not legitimately theirs, and so the jury should return the coins "to their rightful owner, the people of the United States of America."
Barry Berke, a lawyer arguing on behalf of Mr. Switt's heirs, the Langbord family, told the jury that the case was, simply, about power and government overreach. Washington should not be able to seize property from citizens "unless it can prove it is entitled to — and not just powerful enough to take it," he said.
He called the government's case an attempt to "rewrite history," and promised to present alternate explanations for treasured coins coming legitimately into the Langbords' hands: the mint commonly exchanged coins for gold, he said, and the cashier of the mint kept an "open bag" of 1933 double eagles near his desk.
To read the complete article, see:
Family Battles U.S. Over 10 Coins Worth Millions
In her On The Case column for Thomson Reuters, legal writer Alison Frankel (author of Double Eagle: The Epic Story of the World's Most Valuable Coin) writes:
After spending three years researching the story of the 1933 Double Eagles, I'm personally of the view that the gold coins were stolen from the Mint, and that Israel Switt—the now-deceased head of the Langbord family, which claims to own the coins—either abetted the theft or agreed to fence the coins for the thieves. But I also think the U.S. government is going to have a tough time winning possession of the 1933 Double Eagles. The Langbords were smart enough to hire Barry Berke of Kramer Levin Naftalis & Frankel, who previously fought the feds to a sweet settlement in a different piece of 1933 Double Eagle litigation. (You may recall Berke as the lawyer who pulled a risky—but ultimately effective—stunt with a red handkerchief at the criminal trial of a Deutsche Bank executive accused of participating in a tax shelter scheme.)
Berke has already won a key ruling in the Philadelphia Double Eagle case that shifts the burden of proof to the government. Judge Legrome Davis concluded in 2009 that the Treasury Department had violated the Langbords' constitutional rights when it refused to return the 10 1933 Double Eagles to them after the Langbords surrendered the coins for authentication testing. Judge Davis ruled that it's now up to the feds to prove that the coins were stolen from the Mint. So as long as Berke and the Langbords can lay out a plausible scenario for how the 1933 Double Eagles could have left the Mint legally, at a time of great tumult and upheaval, they've got a shot at keeping the coins.
Those jurors in Philly should count themselves lucky to hear the case play out. (As opposed to the poor Rambus antitrust jurors, who have to be prodded to stay awake, according to this great Reuters story on the $4 billion trial underway in San Francisco state court.) OTC can't wait to see what happens next in the saga of the 1933 Double Eagles.
Neither can I! This could be the numismatic case of the century - stay tuned!
To read the complete article, see:
This summer's best trial? The $75 ml case of the Double Eagle
Wayne Homren, Editor
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