Opinion ID: 742598
Heading Depth: 2
Heading Rank: 6

Heading: The Instructions on the RICO Count

Text: 122 RICO makes it unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity. 18 U.S.C. § 1962(c). Defendants contend that, in light of two recent Supreme Court cases, the trial court's instructions to the jury on the RICO count were erroneous with respect to both the participation and the interstate commerce elements. We agree as to the participation element, but we find no basis for reversal.
123 At both trials, the district court instructed the jury, in part, in the following language: 124 The third element, which the government must prove beyond a reasonable doubt, is that the defendant conducted or participated in the affairs of the enterprise. 125 The terms conduct and participate in the conduct of an enterprise, include the performance of the acts, functions or duties that are necessary or helpful to the operation of the enterprise. 126 A person may participate in the conduct of an enterprise even though he had no part in the management or control of the enterprise and no share in any profits. But the participation must be wilful and knowing. 127 (Transcript of Coleman Trial (Coleman Trial Tr.) at 751-52; see Miller Trial Tr. at 6053-54.) Coleman and Raymond Robinson objected to this instruction at their trial, contending that it did not properly reflect the standard set by the Supreme Court in Reves v. Ernst & Young, 507 U.S. 170, 113 S.Ct. 1163, 122 L.Ed.2d 525 (1993) (Reves ). It does not appear that there was such an objection at the Miller Trial. 128 In Reves, in assessing the RICO liability of an outside accounting firm for racketeering activity carried on by its client, the Supreme Court addressed the question of whether one must participate in the operation or management of the enterprise itself to be subject to liability under this provision. Id. at 172, 113 S.Ct. at 1166. The Court answered the question in the affirmative, though noting that one may be liable for participating in the enterprise's operation without being a member of its upper management. Id. at 184, 113 S.Ct. at 1172. As we observed in United States v. Thai, 129 the Reves Court concluded that [i]n order to 'participate, directly or indirectly, in the conduct of such enterprise's affairs,' one must have some part in directing those affairs..... Nonetheless, while thus adopting what it called an  'operation or management' test, ... and stating that one is liable under RICO only if he participated in the operation or management of the enterprise itself, ... the Court also said that the word 'participate' makes clear that RICO liability is not limited to those with primary responsibility ... and that liability under § 1962(c) is not limited to upper management,.... The Court observed that, in addition, within the meaning of § 1962(c), [a]n enterprise is 'operated' ... also by lower-rung participants in the enterprise who are under the direction of upper management..... The Court declined to decide in [Reves ] how far § 1962(c) extends down the ladder of operation. 130 United States v. Thai, 29 F.3d at 816 (quoting Reves, 507 U.S. at 179, 183, 184 & n. 9, 113 S.Ct. at 1170, 1172, 1173 & n. 9). In light of Reves, we have held that an instruction virtually identical to the one given in the present case was erroneous. See United States v. Viola, 35 F.3d 37, 41 (2d Cir.1994), cert. denied, 513 U.S. 1198, 115 S.Ct. 1270, 131 L.Ed.2d 148 (1995). 131 The failure of the district court to give an instruction that comports with the Reves standard, however, is not a basis for automatic reversal. If the defendants timely objected to the erroneous instruction, the error will not warrant reversal if, in light of the evidence introduced as to their roles, the error was harmless. See, e.g., United States v. Masotto, 73 F.3d 1233, 1238-39 (2d Cir.), cert. denied, --- U.S. ----, 117 S.Ct. 54, 136 L.Ed.2d 18 (1996); Napoli v. United States, 45 F.3d 680, 683-84 (2d Cir.) (convictions of defendants, who were high up on the 'ladder of operation,'  were unaffected by Reves error), cert. denied, 514 U.S. 1084, 115 S.Ct. 1796, 131 L.Ed.2d 724 (1995); see also Metromedia Co. v. Fugazy, 983 F.2d 350, 369 (2d Cir.1992) (error in RICO pattern instruction subject to harmless-error analysis), cert. denied, 508 U.S. 952, 113 S.Ct. 2445, 124 L.Ed.2d 662 (1993); United States v. Tillem, 906 F.2d 814, 824-25 (2d Cir.1990) (same). If there was no objection to the erroneous instruction, the instruction is reviewable on appeal only for plain error, that is, error that affected the defendant's substantial rights. See Fed.R.Crim.P. 52(b); United States v. Thai, 29 F.3d at 816. 132 In United States v. Viola, in which the trial court instructed the jury, without objection, that [a] person may participate in the conduct of an enterprise even though he had no part in the management or control of the enterprise and no share in any profits, 35 F.3d at 41 (emphasis in original), we found the error plain as to defendant Michael Formisano. Viola and several others, including Formisano, had been charged with participating in a drug and stolen property importation and distribution ring. Formisano was a janitor who performed menial tasks for Viola, a coffee company proprietor, and the only evidence against Formisano was that on two occasions, at the direction of Viola, he had sold stolen beer and lamps and brought the proceeds to Viola. Although the government asserted that Formisano knew of the broader enterprise, we noted that he was hardly even mentioned in the trial evidence concerning the enterprise. Id. at 44. For example, the government's year-long electronic surveillance did not reveal a single conversation between Formisano and other members of the conspiracy; and in their trial testimony, witnesses who had been participants in the conspiracy ... never mentioned Formisano, much less indicated their familiarity with him. Id. We noted that while Reves holds that liability may attach to lower rung participants in the enterprise, Reves, 507 U.S. at 184, 113 S.Ct. at 1172, Formisano was not on the ladder at all, but rather, as Viola's janitor and handyman, was sweeping up the floor underneath it. United States v. Viola, 35 F.3d at 43. Given the dearth of evidence against Formisano, we reversed his RICO conviction outright, rather than remanding for a new trial before a properly instructed jury. 133 In the present case, there was no such dearth of evidence; indeed, the evidence with respect to the defendants' management or operating roles shows that the error here was entirely harmless. For example, the Supreme Team had scores of workers who were lower on its organizational ladder than Coleman and Raymond Robinson. Coleman had responsibility for groups of workers and sales operations at three Supreme Team drug locations; he was described by former Supreme Team member Trent Morris as one of the organization's lieutenant[s]. Raymond Robinson, whose tenure with the organization was limited and whose rank was somewhat lower than that of Coleman, nonetheless also participated in the Supreme Team's operations at an important level: on wiretaps he was overheard arranging the gang's purchase of cocaine; he acted as security during drug transactions and served as Miller's personal bodyguard; he supervised the processing of cocaine into crack and delivered it to sales locations; and he participated in the gang's move into rival territory. In light of this evidence, Coleman and Raymond Robinson plainly met the standard of participation required by Reves, and we conclude that the jury was not affected by the error in the court's instructions. The erroneous instruction was harmless. 134 We reach the same result with respect to the defendants tried in the Miller Trial, whether or not they objected to the instruction, for the evidence was that each of the six defendants eventually convicted on the RICO count after that trial (Jimenez prevailed on his motion for acquittal on this count) had substantial responsibility for the management of, or discretion in the operation of, the Supreme Team's operations. Miller was the leader; Arroyo was second-in-command. David Robinson helped supervise the drug operations; Tucker managed a retail spot and supervised a crew of workers. Hunt was Miller's bodyguard, and Hale was a security guard; by the nature of their duties as providers of security, Hunt and Hale had discretion to take action without direction from those higher on the chain of command; and both had considerable responsibility for dealing with the Supreme Team's perceived enemies. For example, when Rivera was targeted to be killed, Hunt shot him; when Rivera survived and was tracked down, Hale was one of the men who killed Rivera. It is plain that all six of these defendants had roles that met the standard of participation required by Reves. We conclude that the erroneous instruction was harmless and, a fortiori, was not plain error.
135 With respect to so much of RICO as reaches persons employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, 18 U.S.C. § 1962(c), the trial court initially instructed the jury, to the extent pertinent here, that the government must prove beyond a reasonable doubt ... that the conduct of the enterprise affected interstate ... commerce, that [t]he defendants need not know that their acts would affect such commerce, and that that effect need not be substantial. Indeed, a minimal effect is sufficient. (Coleman Trial Tr. at 755.) In response to a later inquiry from the jury, the court gave a similar supplemental instruction, and added that the government was required to show that the activities of the enterprise, involved some at least minimum effect on interstate commerce. Those affairs, such as the purchasing of supplies from time to time, should you so find--gasoline, anything of the sort that you find satisfies the element of interstate commerce. (Coleman Trial Tr. at 844.) Defendants contend that these instructions did not meet the standard set by the Supreme Court in United States v. Lopez, 514 U.S. 549, 115 S.Ct. 1624, 131 L.Ed.2d 626 (1995) (Lopez ). We disagree. 136 In Lopez, the Supreme Court considered Congress's power to regulate the carrying of guns near schools. The Court concluded that the statute extended the federal government's reach beyond the permissible boundaries of the Commerce Clause of the Constitution because the activity in question ha[d] nothing to do with 'commerce' or any sort of economic enterprise and therefore could not be sustained under [the Court's] cases upholding regulations of activities that arise out of or are connected with a commercial transaction, which viewed in the aggregate, substantially affects interstate commerce, Lopez, 514 U.S. at 561, 115 S.Ct. at 1630-31 (emphasis added). The Court reiterated its longstanding view, however, that  'where a general regulatory statute bears a substantial relation to commerce, the de minimis character of individual instances arising under that statute is of no consequence.'  Id. at 558, 115 S.Ct. at 1629 (quoting Maryland v. Wirtz, 392 U.S. 183, 197 n. 27, 88 S.Ct. 2017, 2024, 20 L.Ed.2d 1020 (1968) (emphasis in Lopez ), overruled on other grounds, National League of Cities v. Usery, 426 U.S. 833, 96 S.Ct. 2465, 49 L.Ed.2d 245 (1976), in turn overruled by Garcia v. San Antonio Metropolitan Transit Authority, 469 U.S. 528, 105 S.Ct. 1005, 83 L.Ed.2d 1016 (1985)). 137 As the Lopez Court itself indicated, Lopez did not alter the principle that where the type of activity at issue has been found by Congress to have a substantial connection with interstate commerce, the government need only prove that the individual subject transaction has a de minimis effect on interstate commerce. See United States v. Genao, 79 F.3d 1333, 1336-37 (2d Cir.1996) (Lopez did not purport to overrule those cases that have upheld application of the Commerce Clause power to wholly intrastate activities); see also United States v. Robertson, 514 U.S. 669, 670-72, 115 S.Ct. 1732, 1733, 131 L.Ed.2d 714 (1995) (per curiam) (reinstating RICO conviction where government had shown that the enterprise itself engaged in interstate commerce); Proyect v. United States, 101 F.3d 11, 14 (2d Cir.1996) (per curiam) (The fact that certain intrastate activities within this class [of regulated activities concerning controlled substances], such as growing marijuana solely for personal consumption, may not actually have a significant effect on interstate commerce is therefore irrelevant.); United States v. Leslie, 103 F.3d 1093, 1100 (2d Cir.) (same re money laundering), cert. denied, --- U.S. ----, 117 S.Ct. 1713, 137 L.Ed.2d 837 (1997). 138 Of especial importance to the present case, we have held that [b]ecause narcotics trafficking represents a type of activity that Congress reasonably found substantially affected interstate commerce, the actual effect that each drug conspiracy has on interstate commerce is constitutionally irrelevant. United States v. Genao, 79 F.3d at 1336. It follows that where, as here, the RICO enterprise's business is narcotics trafficking, that enterprise must be viewed as substantially affecting interstate commerce, even if individual predicate acts occur solely within a state. We conclude that there was no error in the court's instructions on the interstate commerce element. 139