Opinion ID: 569094
Heading Depth: 2
Heading Rank: 3

Heading: Effect of the Error

Text: 45 Although we believe the court's error was prejudicial, we do not believe that it warrants reversal of defendants' convictions. By refusing to allow any direct reference to the prior trials, the district court essentially undermined the defendants' ability to mount a defense to the specific charges that they murdered Detective Venditti and attempted to murder Detective Burke. The court's ruling, however, did not affect in any meaningful way the remainder of the trial. The defendants were permitted to and did vigorously cross-examine the prosecution witnesses on all other relevant subject matters, including all other predicate acts. Further, we are convinced that no spillover taint infected the trial. See United States v. Salerno, 937 F.2d at 808-09. Finally, there simply is no meaningful evidence of judicial bias or misconduct that would necessitate reversal of an otherwise valid conviction. See United States v. Mickens, 926 F.2d 1323, 1327 (2d Cir.1991); United States v. Bejasa, 904 F.2d 137, 141 (2d Cir.), cert. denied, --- U.S. ---, 111 S.Ct. 299, 112 L.Ed.2d 252 (1990); United States v. Robinson, 635 F.2d 981, 984-86 (2d Cir.1980), cert. denied, 451 U.S. 992, 101 S.Ct. 2333, 68 L.Ed.2d 852 (1981). Accordingly, the proper remedy in this case is to vacate the jury's finding solely with respect to the predicate acts of racketeering based on the murder of Venditti and the attempted murder of Burke. 46 Having concluded that it is necessary to vacate the jury's finding with respect to two of the predicate acts of racketeering, we must consider the impact of this conclusion on the defendants' substantive and conspiracy RICO convictions. Since the district court employed a special verdict form, this is a relatively simple task. Review of the verdict form reveals that the jury found--apart from the murder and attempted murder predicates--that Giovanelli had committed two acts of racketeering (conducting an illegal gambling business and conspiring to loanshark) and that Maltese had committed three acts of racketeering (conducting an illegal gambling business, conspiring to loanshark and violating the Travel Act). It is therefore readily apparent that an adequate basis exists to affirm their convictions. See United States v. Coonan, 938 F.2d at 1564. See generally United States v. Ruggiero, 726 F.2d 913, 925-28 (2d Cir.) (Newman, J., concurring in relevant part), cert. denied, 469 U.S. 831, 105 S.Ct. 118, 83 L.Ed.2d 60 (1984). 47 In contrast, Gualtiere's convictions present a more difficult question. Without the murder and attempted murder predicates, Gualtiere was found to have committed only one predicate act of racketeering (conducting an illegal gambling business). Thus, were the only basis for Gualtiere's RICO convictions the jury's finding that he had participated in the enterprise through a pattern of racketeering activity, it would be necessary to reverse. However, the jury also based its RICO verdict on an alternative theory of liability. Specifically, the jury found that Gualtiere, as well as his two co-defendants, had participated in the enterprise through the collection of unlawful debt. Accordingly, it is necessary to consider whether the unlawful debt collection theory provides a valid basis to affirm Gualtiere's convictions. 2. Collection of Unlawful Debt 48 Criminal liability under RICO can be established by proving, inter alia, that the accused participate[d], directly or indirectly, in the conduct of [a racketeering] enterprise's affairs through ... collection of unlawful debt. See 18 U.S.C. § 1962(c). RICO defines unlawful debt to mean: 49 a debt (A) incurred or contracted in gambling activity which was in violation of the law ... or which is unenforceable under State or Federal law ... because of the laws relating to usury, and (B) which was incurred in connection with the business of gambling in violation of the law ..., or the business of lending money or a thing of value at a rate usurious under State or Federal law.... 50 18 U.S.C. § 1961(6) (1988). Unlike a pattern of racketeering activity which requires proof of two or more predicate acts, to satisfy RICO's collection of unlawful debt definition the government need only demonstrate a single collection. See United States v. Vastola, 899 F.2d 211, 228 n. 21 (3d Cir.), vacated and remanded on other grounds, --- U.S. ---, 110 S.Ct. 3233, 111 L.Ed.2d 744 (1990); United States v. Pepe, 747 F.2d 632, 645 (11th Cir.1984). Compare 18 U.S.C. § 1961(5) with 18 U.S.C. § 1961(6). Here, the jury found that the defendants had engaged in the collection of unlawful debt from three individuals: John Marsala, Barbara Messina Kranz, and Larry Alfano. 51 The defendants challenge the jury's finding on two grounds. First, they correctly note that Marsala, Kranz and Alfano were employed as runners in the gambling operation. Based on this fact, the defendants contend that the collections at issue amount to no more than the intraorganization transfer of funds. Obviously, the transmission of money within an organization, regardless of that organization's legality, does not constitute collection of a debt. Indeed, if Marsala, Kranz and Alfano were only runners, we would have no difficulty rejecting the jury's finding. However, reviewing the evidence in the light most favorable to the government, and construing all permissible inferences in its favor, United States v. Puzzo, 928 F.2d 1356, 1357 (2d Cir.1991), we are satisfied that the jury was entitled to find that, although employed as runners, Kranz and Alfano personally placed wagers with the defendants' gambling business and that the resulting debts were collected by the defendants. While the evidence adduced fails to demonstrate that Marsala placed personal bets with the defendants, as noted above, the government need only demonstrate a single collection of unlawful debt. Accordingly, the jury's verdict must be allowed to stand. See United States v. Casamento, 887 F.2d 1141, 1156 (2d Cir.1989), cert. denied, 493 U.S. 1081, 110 S.Ct. 1138, 107 L.Ed.2d 1043 (1990). 52 Second, the defendants argue that the jury's finding must be rejected because the collection of money due on a losing wager does not satisfy RICO's definition of unlawful debt. They assert that to satisfy the definition the prosecution must demonstrate that loans [were extended] to cover gambling losses in order to facilitate continued wagering or that the collection was akin to a visit by a mob strongarm to enforce an illegal gambling debt. The validity of this assertion is belied by the plain language of the statute. 53 Section 1961(6), as the government points out, defines two separate categories of unlawful debts: one involving gambling activity and the other involving loansharking activity. The type of debt the defendants claim will satisfy section 1961(6)'s definition clearly falls within the loansharking category. It is equally clear, however, that a garden variety debt--i.e., [a] specified sum of money owing to one person from another, Black's Law Dictionary 363 (5th ed. 1979)--accumulated as the result of illegal betting, falls within the gambling activity category. See United States v. Angiulo, 847 F.2d 956, 968 (1st Cir.), cert. denied, 488 U.S. 928, 109 S.Ct. 314, 102 L.Ed.2d 332 (1988). Thus, there can be no doubt that RICO's definition of unlawful debt includes the type of obligations incurred by Kranz and Alfano when they placed wagers with the defendants' gambling business. 54 In sum, we are satisfied that the defendants were properly found to have violated RICO by virtue of their collection of unlawful debt. Consequently, regardless of our finding with respect to the pattern of racketeering activity, Gualtiere's and his co-defendants' RICO convictions are affirmed on this basis. 3. Double Jeopardy 55 In light of the foregoing, it is not necessary for the disposition of this appeal that we reach the defendants' claim that the use of previously prosecuted conduct as predicate acts of racketeering in a subsequent RICO prosecution violates principles of double jeopardy. In a series of post-argument submissions, however, the defendants have repeatedly pressed this issue upon the Court. For the most part, the assertions contained in those submissions are based on a fundamental misreading of our recent decisions in United States v. Gambino, 920 F.2d 1108, 1112-13 (2d Cir.1990), and United States v. Coonan, 938 F.2d at 1562-63. We are concerned that the defendants' flawed analysis is likely to recur and to be repeated by other defense counsel. In order to clarify this matter, we briefly consider the double jeopardy issue. 56 The double jeopardy clause of the Fifth Amendment states that no person shall be subject for the same offence to be twice put in jeopardy of life or limb. U.S. Const. amend. V. It is well-settled that the double jeopardy clause protects against a second prosecution for the same offense after acquittal. North Carolina v. Pearce, 395 U.S. 711, 717, 89 S.Ct. 2072, 2076, 23 L.Ed.2d 656 (1969) (footnote omitted); see also Grady v. Corbin, 495 U.S. 508, 110 S.Ct. 2084, 2091, 109 L.Ed.2d 548 (1990). It is equally well-established, however, that the double jeopardy clause's protection only applies in instances where the same sovereign is responsible for the successive prosecutions. See United States v. Coonan, 938 F.2d at 1562-63; United States v. Davis, 906 F.2d at 832. Thus, in the present case the defendants' reliance on the double jeopardy clause is misplaced. As we previously explained: 57 One of the by-products of our nation's federal system is the doctrine of dual sovereignty. ... This doctrine rests upon the basic structure of our polity. The states and the national government are distinct political communities, drawing their separate sovereign power from different sources, each from the organic law that established it. Each has the power, inherent in any sovereign, independently to determine what shall be an offense against its authority and to punish such offenses. When a single act violates the laws of two sovereigns, the wrongdoer has committed two distinct offenses. 58 United States v. Davis, 906 F.2d at 832. Indeed, in United States v. Coonan, addressing an issue virtually indistinguishable from the present one, we stated that a state prosecution does not bar a subsequent federal prosecution of the same person for the same act. Coonan, 938 F.2d at 1562 (citing United States v. Wheeler, 435 U.S. 313, 316-17, 98 S.Ct. 1079, 1082-83, 55 L.Ed.2d 303 (1978) and Abbate, 359 U.S. at 194-95, 79 S.Ct. at 670-71). Thus, the fact that Giovanelli, Maltese and Gualtiere were prosecuted in state court for the murder of Venditti and attempted murder of Burke did not preclude the federal authorities from charging [the] very same offense[s] as [ ] predicate act[s] in the subsequent RICO action. Coonan, 938 F.2d at 1563; accord United States v. Farmer, 924 F.2d 647, 649-50 (7th Cir.1991); United States v. Pungitore, 910 F.2d 1084, 1105-06 (3d Cir.1990), cert. denied, --- U.S. ----, 111 S.Ct. 2009, 114 L.Ed.2d 98 (1991). 59 Nevertheless, citing a recent series of Second Circuit cases, the defendants assert that a RICO conviction cannot be based on conduct previously charged in a state prosecution unless the government demonstrates that racketeering activity continued after the initial prosecution. See, e.g., United States v. Gambino, 920 F.2d at 1112; United States v. Scarpa, 913 F.2d 993, 1013-14 n. 8 (2d Cir.1990). Accordingly, the defendants argue that, since the government failed to prove that racketeering activity occurred after their state trials, it was improper to base their RICO indictment on the murder of Venditti and attempted murder of Burke. The defendants' argument is based on a faulty analysis of the case law. 60 As the defendants note, this Court has recently had occasion to consider whether previously prosecuted conduct might be charged as a RICO predicate act without violating the double jeopardy clause. See, e.g., Gambino, 920 F.2d at 1112-13; Scarpa, 913 F.2d at 1013-14 n. 8; United States v. Persico, 832 F.2d 705, 711 (2d Cir.1987), cert. denied, 486 U.S. 1022, 108 S.Ct. 1995, 100 L.Ed.2d 227 (1988). Each of the cases cited by the defendants, however, actually concerned an even more precise issue, i.e., whether the use of conduct that was the subject of a prior federal prosecution might be charged as a predicate act in a subsequent federal RICO prosecution without violating the double jeopardy clause. Since the dual sovereignty doctrine obviously does not apply in such situations, it was necessary for us to ascertain whether some other theory existed under which the prosecution could be maintained without violating principles of double jeopardy. Consequently, we considered whether the traditional double jeopardy analysis was in any way altered by RICO's compound-complex nature. 61 Our inquiry began with a recognition that double jeopardy principles developed in the 'classically simple situation presented in' single transaction cases [cannot] be readily transposed to the 'multilayered conduct, both as to time and to place involved' in [a] ... RICO case[ ]. Gambino, 920 F.2d at 1113 (quoting Garrett v. United States, 471 U.S. 773, 789, 105 S.Ct. 2407, 2416, 85 L.Ed.2d 764 (1985)). Further, we noted that oftentimes the government is not in a position to charge a RICO violation until after the individual predicate acts have been prosecuted. See Gambino, 920 F.2d at 1113 (citing Garrett, 471 U.S. at 788-89, 105 S.Ct. at 2416-17). Based on these considerations, we ultimately held that the double jeopardy clause does not bar the use of conduct that was the subject of a prior prosecution, as a predicate act of racketeering in a subsequent RICO prosecution, brought by the same sovereign--at least when the racketeering activity continues beyond the initial prosecution. See Gambino, 920 F.2d at 1113; Scarpa, 913 F.2d at 1013-14 n. 8; Persico, 832 F.2d at 711; see also Coonan, 938 F.2d at 1563. 62 Of course, that holding, addressed as it was to successive prosecutions by the same sovereign, is of minimal significance in the present case. As explained above, under the dual sovereignty doctrine a federal indictment charging conduct that was previously the subject of a state prosecution simply does not implicate the double jeopardy clause. [N]othing prevents a federal prosecution whenever the state proceeding has not adequately protected the federal interest. United States v. Davis, 906 F.2d at 832. Hence, the defendants are in error when they assert that, since the government failed to establish that they engaged in racketeering activity after the conclusion of the state trials, their convictions violate the Fifth Amendment's double jeopardy clause. Indeed, acceptance of the defendants' argument would result in an evisceration of the dual sovereignty doctrine.4. Playing Tape on Rebuttal Summation 63 Next, the defendants assert that the prosecution engaged in misconduct when, on rebuttal summation, it played a portion of a tape-recording of two telephone conversations between Giovanelli's wife and Gualtiere's wife. The conversations occurred shortly after the shooting of Detectives Venditti and Burke and concerned, among other things, Gualtiere's whereabouts on the night of the shooting. Based on the conversations, the prosecution essentially argued to the jury that the defendants had manufactured alibis. On appeal, the defendants claim that the prosecutor acted improperly because the recorded conversations had not previously been played for the jury--although the tapes had been entered into evidence. Also, assuming arguendo that it was permissible to play the tapes, the defendants contend that it was error for the district judge not to allow the jury to hear the relevant conversations in their entirety. 64 At most, the defendants' arguments suggest that their ability to defend against the charges that they murdered Detective Venditti and attempted to murder Detective Burke was undermined by the prosecution's conduct. Because we have already concluded that it is necessary to vacate the jury's finding with respect to the murder and attempted murder predicate acts, there simply is no need to consider this issue. 5. The Necessity for a Remand 65 Finally, this case presents a somewhat unusual situation. As the preceding discussion indicates, we believe that the defendants' convictions should be affirmed. Under ordinary circumstances, we would simply affirm the lower court's judgment and there would be no need for a remand. This case, however, is not ordinary. 66 Specifically, in the present case, it is necessary to vacate the jury's findings with respect to the murder of Detective Venditti and attempted murder of Detective Burke. Our reading of the entire record reveals that proof directed at establishing those predicate acts consumed a substantial portion of the trial. Moreover, the murder and attempted murder predicate acts were by far the most grievous charges the jury found to have been proven against the defendants. In holding that the predicate acts must be vacated, we therefore significantly alter the nature of the charges of which the defendants have been convicted. Thus, we believe the appropriate course of action is to vacate the sentence on the RICO counts and to remand the case for resentencing consistent with this opinion.