Source: http://nj.findacase.com/research/wfrmDocViewer.aspx/xq/fac.19680801_0000022.DNJ.htm/qx
Timestamp: 2017-03-29 19:09:05
Document Index: 521043054

Matched Legal Cases: ['§ 1952', '§ 371', '§ 1952', '§ 1952', '§ 371', '§ 1952', '§ 1952', '§ 601', '§ 521', '§ 46', '§ 521', '§ 521', '§ 49', '§ 49', '§ 1952', '§ 1951', '§ 186', '§ 521', '§ 49', '§ 1951', '§ 1952', '§ 521', '§ 521']

| UNITED STATES v. ZIRPOLO
UNITED STATES v. ZIRPOLO
Walter ZIRPOLO, Robert E. Jacks, Colonial Pipeline Company, Karl T. Feldman, Glenn H. Giles, Ben D. Leuty, Rowland Tompkins Corporation, Bechtel Corporation, Gates Construction Corporation, Gates Equipment Corporation, Defendants
On Motions Addressed To Indictment WORTENDYKE, District Judge: The Nine Count Indictment, filed in this case on February 23, 1967, has been made the target of over forty pretrial motions in behalf of the ten several defendants charged therein. By way of general introduction to the succeeding nine Counts into which the offenses charged against the defendants are divided, the Indictment alleges that, at all times mentioned therein, Walter Zirpolo was Mayor of the Township of Woodbridge, New Jersey, and a voting member of the Planning Board thereof, and Robert E. Jacks was a Committeeman representing the Third Ward of the Township, a voting member of its governing body, and, subsequent to January 1, 1964, President of its Municipal Council. Jacks was also the owner of a single proprietary business in the municipality. Colonial Pipeline Company (hereinafter Colonial) was a Delaware corporation, with principal offices in Atlanta, Georgia. Karl T. Feldman was Executive Vice President, Glenn H. Giles was Manager of Construction and Ben D. Leuty was President of Colonial. Rowland Tompkins Corporation, formerly known as Rowland Tompkins & Son, Inc., was a New York Corporation, and Howard Tompkins and Ralph A. Bankes (unindicted co-conspirators) were respectively President and Vice President of that corporation. Bechtel Corporation (hereinafter Bechtel Corp.) was incorporated in the State of Delaware, but had its principal office in San Francisco, California; and Harry F. Waste, Robert L. Bowman and William L. J. Fallow (unindicted co-conspirators) were respectively Vice President and employees of Bechtel Corp. Gates Construction Corporation (hereinafter Gates Const. Corp.) and Gates Equipment Corporation (hereinafter Gates Equip. Corp.) were New Jersey corporations, and Robert S. Gates (an unindicted co-conspirator) was President of those corporations. In Count 1 the Grand Jury charges that between January 1, 1963 and December 31, 1964 the defendants Zirpolo, Jacks, Colonial, Giles, Feldman, Leuty and Rowland Tompkins Corporation, together with Howard Tompkins and Ralph A. Bankes (who are not named as defendants in the Indictment) knowingly, wilfully and unlawfully combined and conspired with each other, and with a representative of Rowland Tompkins Corporation, to commit certain offenses against the United States of America in violation of 18 U.S.C. § 1952 in that: "[The] defendants and said co-conspirators would travel and wilfully cause others to travel in interstate commerce and * * * use and wilfully cause others to use facilities in interstate commerce, including telephones and the mails, * * * with the intent to promote, manage, establish and carry on and facilitate the promoting, managing, establishing and carrying on of an unlawful activity, * * * being the obtaining of a building permit by bribery of officials of the Township of Woodbridge, New Jersey, in violation of * * * N.J.S. 2A:93-6, * * *." It is further alleged that, as parts of said conspiracy, Colonial would request the assistance of Zirpolo in obtaining a building permit from the Township of Woodbridge, New Jersey, for erection of 22 petroleum storage tanks within the Third Ward of the Port Reading Section of said Township; Zirpolo would inform Colonial that its application for the building permit would be opposed by residents of the area for which the permit was sought; and that Colonial would agree not to file its application for the building permit until after the November 5, 1963 elections, in which Zirpolo was a candidate for reelection as Mayor, for the reason that Zirpolo and Jacks had promised their constitutents that no additional petroleum tanks would be erected in that section of the municipality. The Indictment further alleged that, as an additional part of the conspiracy complained of, Zirpolo would arrange for a meeting by Colonial's employee Stewart with Jacks at the latter's place of private business in Woodbridge, and that Jacks would inform Stewart that the then existing municipal government administration of Woodbridge could, if reelected, aid Colonial in securing its building permit after the November 5, 1963 election, without which aid Colonial's building application might be defeated because of opposition of the residents of the Port Reading Section of the municipality which had been expressed at a public hearing before the Planning Board thereof. It is further charged that it was also a part of the conspiracy that Jacks would, on behalf of himself, Zirpolo and other persons unknown to the Grand Jury, solicit from Colonial, through its employee Stewart, the sum of $50,000 as a campaign contribution in return for aiding Colonial after the November 5, 1963 elections in securing a building permit from the Township over the opposition of the objecting residents of the Port Reading Section of the municipality. The Indictment also charged that it was a part of the conspiracy that defendants Giles, Feldman and Leuty, acting in behalf of Colonial, would agree among themselves, and with other persons to the Grand Jury unknown, to transmit the sum of $50,000 from the office of Colonial in Atlanta, Georgia, to Zirpolo and Jacks in Woodbridge, New Jersey, and to other persons to the Grand Jury unknown, for the purpose of procuring the assistance of Zirpolo and Jacks in obtaining the building permit from the Township. It was also a part of the conspiracy that Colonial, Giles, Feldman, Leuty, Rowland Tompkins, Zirpolo and Jacks, and the unindicted co-conspirators Tompkins and Bankes, together with a representative of Rowland Tompkins, would agree among themselves, and with divers other persons to the Grand Jury unknown, to travel in interstate commerce and to use and to cause the use of facilities therein, including the mails and the telephone, for the purpose of transmitting the aforesaid $50,000 from Colonial's office in Atlanta, Georgia to the office of Rowland Tompkins in Hawthorne, New York, and thence to Zirpolo and Jacks in Woodbridge, New Jersey, in three installments; that the first payment of $20,000 would be due on or about November 6, 1963; the second payment of $15,000 would be due after a building permit had been issued to Colonial by the Township of Woodbridge, and that the third payment of $15,000 would be due after a certificate of occupancy had been issued to Colonial by the Township. It is finally alleged that it was further a part of the conspiracy that the defendants would make and cause to be made false and fictitious documents, and would perform other acts, for the purpose of hiding and concealing, and causing to be hidden and concealed, the purpose of, and acts done in furtherance of the conspiracy, in violation of 18 U.S.C. § 371. Following the foregoing allegations of conspiracy, the Indictment particularizes a series of nineteen (19) overt acts, commencing on or about August 16, 1963 and terminating on or about November 27, 1964. Counts 2 through 5 set out the substantive offenses charged against the defendants in connection with the Count 1 conspiracy. Each of these substantive offenses allegedly involved travel in interstate commerce, use of interstate facilities and the transmission or attempted transmission of the sums of money referred to in the conspiracy allegation from Colonial, through various other hands, to the defendant Jacks. The substantive offenses alleged are charged as being violative of 18 U.S.C. §§ 1952 and 2. Count 6 of the Indictment charges that between January 1, 1964 and December 31, 1964, the defendants Zirpolo, Jacks, Colonial, Giles, Bechtel Corp., Gates Const. Corp., Gates Equip. Corp. and Harry F. Waste, Robert L. Bowman, William L. J. Fallow and Robert S. Gates (unindicted co-conspirators) knowingly, wilfully and unlawfully combined and conspired with each other, and with others unknown to the Grand Jury, to commit certain offenses in violation of 18 U.S.C. § 1952 by traveling and causing others to travel in interstate commerce, and by using and causing others to use interstate facilities, with the intent to promote the unlawful activity of obtaining easements by bribery of officials of Woodbridge Township in violation of N.J.S. 2A:93-6, N.J.S.A. The Indictment further alleges that, as parts of this conspiracy, Colonial, acting through its employee, Fred Stewart, would solicit advice and assistance from Zirpolo in arranging for the proposed purchase of easements through Woodbridge by Colonial on land owned by the Township; that Zirpolo would agree to meet with Stewart at Zirpolo's office at the Menlo Park Shopping Center, Edison, New Jersey but that instead, Zirpolo would arrange for Stewart to meet with Jacks at the above-mentioned location. At that meeting, Jacks, on behalf of himself, Zirpolo and unknown others, would solicit $100,000 from Colonial as a condition for obtaining the sale of easements through property of Woodbridge Township. As an additional part of the conspiracy, it is alleged that Giles, Feldman and Leuty, acting for Colonial, would confer and agree to transmit $60,000 from Colonial to Zirpolo and Jacks to obtain their assistance in securing the sale of the easements. It is further alleged that in furtherance of the Count 6 conspiracy, the defendants and unindicted co-conspirators named in that Count would agree to travel and to cause others to travel in interstate commerce and to use and to cause the use of interstate facilities for the purpose of arranging for the payment of $60,000 by Colonial to Zirpolo and Jacks in Edison, New Jersey; that in furtherance of same, arrangements would be made for a transfer of $20,000 in cash from Bechtel Corp.'s New York office to its New Jersey headquarters, and thence to Zirpolo and Jacks. It is further alleged that arrangements would be made to utilize interstate commerce and facilities to effect the transfer, by means of false and fraudulent invoices, of $84,800, in two equal installments, from Colonial through Bechtel Corp., Gates Const. Corp. and Gates Equip. Corp., for the purpose of transmitting $40,000 in two equal payments to Zirpolo and Jacks. Finally, it is alleged that the defendants would make, and cause to be made, false and fictitious documents and would perform other acts to hide the purpose of, and acts done in furtherance of the conspiracy, all in violation of 18 U.S.C. § 371. The Indictment then reveals a series of twenty-three Overt Acts between February 12, 1964 and December 18, 1964 allegedly committed in furtherance of the alleged conspiracy. Counts 7, 8 and 9 recite the substantive offenses allegedly committed in connection with the Count 6 conspiracy. These Counts allege three separate instances of transferring the amounts referred to in the conspiracy Count from California to New Jersey in violation of 18 U.S.C. §§ 1952 and 2. The offenses charged in this Indictment center around 18 U.S.C. § 1952 which provides that: "(a) Whoever travels in interstate or foreign commerce or uses any facility in interstate or foreign commerce, including the mail, with intent to - * * *; * * * (3) otherwise promote, manage, establish, carry on, or facilitate the promotion, management, establishment, or carrying on, of any unlawful activity, and thereafter performs or attempts to perform any of the acts specified * * * shall be * * * [guilty of a violation of 18 U.S.C. 1952]. (b) As used in this section 'unlawful activity' means * * *, or (2) extortion, bribery, or arson in violation of the laws of the State in which committed or of the United States." At all times relevant to the allegations of the Indictment in this case N.J.S. 2A:93-6, N.J.S.A. provided as follows: "2A:93-6. Giving or accepting bribes in connection with government work, service, etc. Any person who directly or indirectly gives or receives, offers to give or receive, or promises to give or receive any money, real estate, service or thing of value as a bribe, present or reward to obtain, secure or procure any work, service, license, permission, approval or disapproval, or any other act or thing connected with or appertaining to any office or department of the government of the state or of any county, municipality or other political subdivision thereof, or of any public authority, is guilty of a misdemeanor." CLAIMS OF GILES, FELDMAN AND LEUTY TO STATUTORY IMMUNITY The defendants Giles, Feldman and Leuty have moved to dismiss the Indictment upon two grounds: (1) each of these defendants is immune from prosecution by virtue of the immunity provisions of § 601 of the Landrum-Griffin Act, 29 U.S.C. § 521; and (2) each of said defendants is immune from prosecution by virtue of the immunity provisions of the Interstate Commerce Act, 49 U.S.C. § 46. The alleged immunity under the Landrum-Griffin Act is predicated upon the assertion that these defendants have given testimony with regard to transactions, matters and things covered by the Indictment, in obedience to a subpoena in a labor investigation conducted by the Secretary of Labor and officers designated by him, which comprehended possible violations of the Landrum-Griffin Act. That assertion is not in accordance with fact, and the situation disclosed in United States v. Weber, 255 F. Supp. 40 (D.N.J.1965) aff'd sub nom. United States v. Fisher, 384 U.S. 212, 86 S. Ct. 1453, 16 L. Ed. 2d 479 (1966) is not only not identical with that in the case at bar but is clearly distinguishable therefrom. The difference between the cases is to be found at page 45 of the District Court's Opinion in the statement that: "The Court does not mean to say that the United States Attorney had no right to subpoena Fisher or to conduct an investigation outside of the search for L.M.R.D.A. violations. If the subject matter of Fisher's testimony was anti-fraud then immunity would not necessarily attach unless it was a direct outgrowth of the testimony. See Heike v. United States, 227 U.S. 131, 33 S. Ct. 226, 57 L. Ed. 450 (1913) * * * and Monia * * * [ United States v. Monia, 317 U.S. 424, 63 S. Ct. 409, 87 L. Ed. 376 (1943)]." Section 601 of the Landrum-Griffin Act, 29 U.S.C. § 521, empowers the Secretary of Labor to conduct an investigation whenever he believes it necessary to determine whether any person has violated or is about to violate certain provisions of the Act. Subsection (b) of 29 U.S.C. § 521 makes 15 U.S.C. §§ 49 and 50 the controlling statutory sections to be applied in producing information and testimony during the course of such an investigation. 15 U.S.C. § 49 provides, in pertinent part, that: "No person shall be excused from attending and testifying or from producing documentary evidence before the [Federal Trade Commission] * * * or in obedience to the subpoena of the commission on the ground or for the reason that the testimony or evidence, documentary or otherwise, required of him may tend to criminate him or subject him to a penalty or forfeiture. But no natural person shall be prosecuted or subjected to any penalty or forfeiture for or on account of any transaction, matter, or thing concerning which he may testify, or produce evidence, documentary or otherwise, before the commission in obedience to a subpoena issued by it: * * *." The Grand Jury investigation which resulted in the Indictment in the case at bar involved no violations of the Landrum-Griffin Act over which the Secretary of Labor had any jurisdiction. On the contrary, that investigation related to alleged violations of 18 U.S.C. § 1952, 18 U.S.C. § 1951 and 29 U.S.C. § 186. The immunity provided by 29 U.S.C. § 521(b) and 15 U.S.C. § 49 can arise in favor of a person who has testified or produced evidence, documentary or otherwise, in obedience to a subpoena issued by or on behalf of the Secretary of Labor. Neither the Secretary of Labor nor any of his designees ever issued a subpoena either ad testificandum or duces tecum to any of the defendants in the case at bar who is presently moving for a dismissal of the Indictment. There never was any grand jury labor investigation within the purview of the Landrum-Griffin Act. In 1961 it was discovered that there had been a wholesale embezzlement of labor union funds in the pipeline construction industry. As interstate pipeline construction crossed state lines, the same labor force was usually retained by the contractor throughout the work. This would frequently involve the intrusion of members of labor union locals into the territorial jurisdiction of members of other locals. This would require that the foreign local member would be required to pay "dobie" fees to the local having jurisdiction over the territory in which the foreign local member worked. Representatives of the Secretary of Labor discovered that some of these "dobie" payments were not being turned in to the Treasury of the local into whose territory the payor had intruded, but were being embezzled by the agent of the local union who had collected the "dobie". Because no records were kept of the receipt of the "dobie" payments by the collectors, it was difficult, if not impossible, to discover the embezzlements. Therefore, the investigators of the Labor Department endeavored to ascertain from the files of the employers the names of the out-of-state men who had worked on a given project within the state, and then to ascertain from the records of the union having territorial jurisdiction over the work whether the "dobie" payments had been turned in to that local. The Labor Department instituted an investigation upon a nationwide basis which was commenced on August 28, 1964 and involved three successive steps: (1) ascertainment of the names of the contractors who had constructed the largest and the latest interstate pipelines; (2) ascertainment from the contractors' records how much "dobie" had been checked off and (3) examination of the records of each union to determine whether the "dobie" payments had in fact been received by the intended local. This investigation revealed that Colonial was constructing an interstate pipeline from Houston, Texas to Linden, New Jersey, and that one of its subcontractors was Bechtel Corp. of San Francisco, California. The investigators were informed that Osage Construction Company of Tulsa, Oklahoma had been involved contractually in the construction of the pipeline as a subcontractor with Colonial, but that Colonial had been forced by a labor leader to rescind the contract with Osage and to let it to another subcontractor at a higher price. For the purpose of verifying this information, the investigators contacted Giles and Feldman, officers of Colonial, in the presence of an attorney for that corporation. The interview yielded verification of the information which the investigator had obtained and also revealed that the Osage contract had been awarded to another corporation believed to be in league with the labor leader. Upon the suggestion of Feldman, the investigators consulted a private detective, who had been employed by Colonial in New Jersey, from whom further confirmation of the statements of Giles and Feldman was obtained. The foregoing information was disclosed to the Deputy Chief of the Organized Crime and Racketeering Section of the Department of Justice, who advised the investigators that the information disclosed a possible violation of the Hobbs Act, 18 U.S.C. § 1951. The matter was then turned over to the Federal Bureau of Investigation, and the Department of Labor conducted no further investigation in the premise. Inquiry of Bechtel Corp. in San Francisco had revealed that certain members of the New Jersey Operating Engineers were being paid for 21 hours a day, six days a week, and that the recipients of this pay appeared to be union agents, several of whom had grossed more than $50,000 in less than 12 months of actual work. After the investigation by the Secretary of Labor had been relinquished and turned over to the Federal Bureau of Investigation, the office of the Attorney General by Fred M. Vinson, Jr., Assistant Attorney General in charge of the Criminal Division of the Department of Justice, on the basis of the completed F.B.I. investigation, authorized a general Grand Jury investigation into the construction of the Colonial Pipeline within New Jersey, and the Deputy Attorney General appointed Messrs. White, Stern and Goldstein, special attorneys to conduct such a Grand Jury investigation with the object of ascertaining whether there had been violations of the Hobbs Act or the Taft-Hartley Act or both. Because of the information which had already been obtained by one of the Labor Department investigators, the Department of Justice requested the loan of that investigator, in the interest of economy, to the special attorneys conducting the Grand Jury investigation. The fruits of the Grand Jury investigation, conducted by the special attorneys, resulted in Indictments for extortion and attempts to extort money in violation of the Hobbs and Taft-Hartley Acts. In addition to these Indictments, the Grand Jury returned the Indictment in the case at bar charging the defendants herein with conspiracy to violate and substantive violations of 18 U.S.C. § 1952. No violation of any labor statute which the Secretary of Labor has the authority to investigate under 29 U.S.C. § 521 was charged in that Indictment. The special attorneys of the Department of Justice designated by the Deputy Attorney General caused a special Grand Jury to be impanelled on February 14, 1966 for the purpose of investigating the possibilities of extortion in the conduct of the labor leader hereinabove referred to in allegedly forcing Colonial to rescind its contract with Osage; forcing another company to pay him a substantial amount in cash in connection with the payments to union agents for fictitious services by the threat of labor unrest; and in connection with pressure allegedly put on Bechtel Corp. to award a subcontract to the Joyce Pipeline Company. Four separate Indictments were returned by this Grand Jury charging the labor leader and others with numerous Hobbs' Act violations; but no indictment was ever returned concerning any matter which lay within the investigative jurisdiction of the Secretary of Labor, under 29 U.S.C. § 521, which he could delegate pursuant to a memorandum of understanding with any other executive department or otherwise. The defendant, Giles appeared before the Grand Jury on March 31, 1966 in response to a subpoena duces tecum directed to him as an officer and representative of Colonial to produce corporate documents. He stated that he understood that his appearance was only for the purpose of producing books and records called for in the subpoena; that he was not required to give any testimony respecting any matter whatsoever; and that if he volunteered anything, either before the grand jury or in conversation with anyone connected with the Government, either inside or without the grand jury room, he would be doing so as a matter of his own free choice and not in response to any subpoena. He was warned that he was under no obligation to speak to any Governmental employee either within or without the grand jury room but that if he did so, whatever he might say might be taken down and used in evidence. He stated that he recognized that he had the right to counsel, and admitted that he was accompanied to the door of the grand jury room by his attorney who awaited him outside the room. The following day, April 1, 1966, Giles again voluntarily appeared before the Grand Jury and, on the advice of counsel, executed a waiver of immunity. He was then again reminded of his rights and warned and reported that he had consulted with his counsel. On this occasion Giles was asked no questions concerning the subject matter of the Indictment in this case. During the month of May, F.B.I. accounting agents, in the course of examination of records of Bechtel Corp. for the Department of Justice, found a cancelled check in the amount of $20,000 which Bechtel Corp. had negotiated for cash. On May 24, 1966 one of the Bechtel Corp. bookkeepers informed the special attorneys for the Department of Justice that the check had been drawn by one Basil Licklider. On May 31, 1966, before Licklider was due to appear before the Grand Jury, his attorneys informed the special attorneys of the Department of Justice that Bechtel Corp. had given $60,000 in cash to the Mayor and Council President of the Township of Woodbridge, New Jersey on behalf of Colonial to enable Colonial to obtain certain permits and easements from the Township. This was the first information which the Government had received relating to the offenses charged in the Indictment in this case. Between May 31, 1966 and June 5, 1966 the attorneys for Bechtel Corp. conferred with the attorneys for Colonial respecting the revelations which Bechtel Corp. had made to the Department of Justice; but on June 6, 1966 the attorneys for Bechtel Corp. informed the Department of Justice that Colonial refused to cooperate and would not come forth voluntarily to disclose its connection with the subject thereof. On June 8, 1966 Giles appeared before the Grand Jury with certain books and records of Colonial, and revoked his previously executed waiver of immunity. He accordingly was released from the grand jury room without interrogation. As of this time the Government had no knowledge that Colonial had made a payment of $50,000 to Jacks and Zirpolo prior to the $60,000 payment which Bechtel Corp. had disclosed. On June 15, 1966 the attorney for Colonial advised the special Government attorneys that Colonial would not cooperate concerning the Bechtel Corp. disclosure of the $60,000 cash payment to Woodbridge officials which was then under investigation by the Grand Jury. On June 17, 1966 the Government attorneys caused a subpoena duces tecum to be served upon Giles for the ...