Record and brief — Seregos v. United States

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IN THE

Supreme Court of the United States

OCTOBER TERM, 1981

NICHOLAS SEREGOS,

Petitioner,

V.

UNITED STATES OF AMERICA,

Respondent.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

JOHN D. GORDAN, Ill

LAURIE E. FOSTER

25 Broadway

New York, New York 10004

(212) 344-8480

Attorneys for Nicholas Seregos

PROFESSIONAL PRINTING SERVICES, INC., Successor to The Paul M. Harrod Company

5. O. Box 6594 © Baltimore, Maryland @ 21234

i

QUESTIONS PRESENTED

1, Whether (a) the Government's use of Mr, Seregos’

prior immunized testimony in making tactical decisions in his

prosecution, and (b) its cross examination of Mr. Seregos at

his own trial about matters disclosed in his immunized testimony

and not shown to have had an untainted source, complied with

the rule announced in Kastigar „ United States, 406 U.S, 441

(1972),

2, Whether the Constitution permits the retroactive

application of a decision of this Court to punish conduct under

a statute which, at the time the conduct occurred, had been

held inapplicable to it by the Court of Appeals,

TABLE OF CONTENTS

Page

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eee otc e ete davetveccednennd 2

r 2. oe dows cbeedeeedéooeet 2

Dee eee eee 2

eee een ee Pe rere Pre r 2

J 4

C. The First Indictment and The Immunized Testi-

„een eee eee e 4

D. Post-Indictment Proceedings and Trial 5

Se, p 6

F. The Motion under Rules 12 and 34 of Federal

Rules of Criminal Procedure 0

G. The Opinions of the District Court 8

H. The Opinion oſ the Court of Appeals 9

REASONS SUPPORTING ISSUANCE

r ... Padedeeael 10

I, The Court of Appeals has Departed from the

Requirements of Kastiga nnn 11

Il. The Ex Post Facto Application of the Travel

Act to Mr. Seregos Violated the Due Process

iv

TABLE OF AUTHORITIES

Page

Cases

Abbate v. United States, 359 U.S. 187 (1959) ............ 17

Bouie v. City of Columbia,

Z 10,1417

Calder v. Bull, 3 Dall. 386 (1798 00 õ;.: 11,17

Douglas v. Buder, 412 U.S. 430 (1973). 14

Kastigar v. United States,

ER ey 2,5-7,9-13

Marks v. United States, 430 U.S. 188 (1977) ...... 8,10, 14-16

Memoirs v. Massachusetts, 383 U.S. 413 (1966)........... 15

Miller v. California, 413 U.S. 15 (1973) .............. 15,16

New Jersey v. Portash, 440 U.S. 450 (1979)........... 10-12

Perrin v. United States, 444 U.S. 37 (1979) ....... 8-10, 14-16

Rewis v. United States, 401 U.S. 808 (1971777) 17

United States ex rel. Clark v. Anderson,

502 F.2d 1080 (3d Cir. 197 ꝰhᷣ 10,16,17

United States v. Brecht, 540 F.2d 45 (2d Cir. 1976),

cert. denied, 429 U.S. 1123 (1977).......... 8-10,13-17

United States v. Goodheim, 651 F.2d 1294

. 10,15-17

United States v. Maze, 414 U.S. 395 (1974)! 5

United States v. McDaniel, 482 F.2d 305

e Re ree ey Fee 10-12

United States v. Peltier, 422 U.S. 531 (1975)............. 15

United States v. Perrin, 580 F.2d 730 (Sth Cir. 1978),

re. ed et dbbee tees 16

United States v. Persky, 520 F.2d 283

S NEaM se. tick bocvileede ccntens 16

United States v. Pomponio, 511 F.2d 953 (4th Cir.),

cert. denied, 423 U.S. 874 (19777)... 9,16

United States v. Potts, 528 F.2d 883

e. eee 15

Page

United States v. Scotto, 641 F.2d 47 (2d Cir. 1980),

cert. denied, 101 S. Ct. 3109 (1981).......... 4-8, 11,12

Weaver v. Graham, 450 U.S. 24 (19817777777: 11

Constitutional Provisions

U. S. Constitution, Amendment V ............. 2,8,10,14-16

Statutes and Rules

18 U.S.C

o reel 24.5

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! ů²˙²˙¹⅛»AA ͤ , wr Lee ene 15

ness 2,5,8,9,10,13-17

28 U.S.C.

rede bees 2

D .be eee 2,4

N.Y. Penal Law (McKinney’s Supp. 1979-80)

eee ebenes 2.5, 13

r ˙Ü˙Zĩ˖QK—»ůO ...en 2.5, 13

e. eee ese eee 8

e . TT ETT Te 8

e 5

INDEX TO APPENDIX

Opinion of the Court of Appeals A. 1

February 26, 1980 Order of the District Court......... A. 11

Vesdict of the District Court. G A. 14

August 4, 1980 Opinion of the District Court.......... A. 18

August 5, 1980 Order of the District Court............ A. 26

September 15, 1980 Order of the District Court........ A. 28

October 17, 1980 Order of the District Court.......... A. 30

Judgment of the Court of Appeals A. 33

Order of the Court of Appeals Denying Rehearing ....... A. 34

IN THE

Supreme Court of the United States

OCTOBER TERM, 1981

NICHOLAS SEREGOS,

Petitioner,

V.

UNITED STATES OF AMERICA,

Respondent.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

The Petitioner, Nicholas Seregos, respectfully requests

*hat a writ of certiorari issue to review the opinion and judg-

ment of the United States Court of Appeals for the Second

Circuit entered on July 28, 1981.

2

OPINIONS BELOW

The opinion of the Court of Appeals is reported at 655

F.2d 33. It appears in the Appendix hereto at A. 1 - A. 10.“

The opinions of the District Court concerning the issues raised

in the petition are found at A. 18 - A. 27 (Kastigar issues) and

A. 28 - A. 32 (Due Process issue).

JURISDICTION

The Judgment of the Court of Appeals was entered on

July 28, 1981 (A. 33). On August 7, 1981, Mr. Seregos filed a

timely petition for rehearing and a suggestion of rehearing en

banc; the petition and suggestion were denied on September 14,

1981 (A. 34). The jurisdiction of this Court is invoked under

28 U.S.C. § 12541).

STATUTES INVOLVED

This case involved application of 18 U.S.C. § 1952, predi-

cated on violation of N. V. Penal Law §§ 180.03 and 180.08,

18 U.S.C. § 371, the federal use immunity statute (18 U.S.C.

§ § 6001 ef seq.), and the Fifth Amendment to the Constitu-

tion of the United States. These are set forth in the Appendix

at A. 35-A. 39.

STATEMENT OF THE CASE

A. The Facts

In 1973 Edward J. Pierson of Moore-McCormack Lines

and Richard Weeks of Weeks Stevedoring Co. negotiated a two-

year lease, with three six-month renewal options, for a floating

*Citations to the Appendix to this petition are in the above form.

References with the prefix “Tr.” refer to the transcript of the trial. Refer-

ences with the prefix “H.Tr.” or “H.GX.” refer respectively to the

transcript of, and to the Government exhibits at, the post-trial Kastigar

hearing. References with the prefix “R.” are to the number of a particu-

lar paper in the Record on Appeal in the Court of Appeals.

3

crane to be furnished by Weeks Stevedoring to the Moore-

McCormack cargo terminal in Brooklyn, N.Y. (Tr. 35-40;

GX. 8). After the lease had been agreed to, Pierson secured

Weeks’ agreement to pay him a monthly kickback of $1,500.00

(Tr. 38-39, 87).

Using a variety of devices, Weeks made the payments

through Pierson’s intermediaries at irregular intervals until

mid-summer 1976, when Weeks was unable to generate the

necessary cash off the books of Weeks Stevedoring (Tr. 44-46).

Pierson then sought assistance from William Montella, who was

also paying him kickbacks; Montella suggested that Nicholas

Seregos, president of Jackson Engineering Co., a ship repair

firm, might be of assistance (Tr. 49-52).

According to Pierson, in August or September, 1976, he

had the first of several meetings with Mr. Seregos, who had had

no previous involvement with Pierson, Weeks or their kickback

arrangement (Tr. 53-55). At Pierson’s behest, Mr. Seregos pre-

pared a fictitious $25,795 invoice to Weeks Stevedoring for

work purportedly done on the crane by Jackson Engineering

(Tr. 59-61; GX. 1). When the invoice was paid in December,

1976, Mr. Seregos turned $18,000 over to Pierson, retaining the

balance to cover Jackson Engineering’s taxes (Tr. 62-64).

Mr. Seregos, who took the stand on his own defense,

admitted preparing the false invoice and that the work reflected

was not performed. He testified, however, that he had not had

the meetings Pierson claimed, that he was unaware of the kick-

back arrangement between Pierson and Weeks, and that his

dealings had been with Montella, to whom he had delivered the

$18,000 (Tr. 487-523).

On cross examination the prosecutor asked whether

Mr. Seregos had testified falsely before the Waterfront Commis-

sion in 1976 and whether he had made payments to employees

of Hellenic Lines, a customer of Jackson Engineering Co.

Mr. Seregos admitted he had done both (Tr. 555-63, 632-38).

The District Judge, who was sitting without jury, referred to

each of these admissions either during summations or in his

findings of guilt (Tr. 720-21; A. 14-15).

B. Pre-Indictment Events

This prosecution grew out of an investigation in the

Southern District of New Vork and elsewhere into waterfront

corruption. A principal target of the investigation was Anthony

Scotto, president of Local 1814 of the International Long -

shoremen’s Association“ (R. 5).

In the winter of 1979, Mr. Seregos came to the attention

of the United States Attorney’s Office for the Southern District

of New York as a potential witness against Scotto. There

followed nearly six months of negotiations during which the

United States Attorney’s Office offered Mr. Seregos a misde-

meanor plea in return for his cooperation.“ Mr. Seregos

refused any such arrangement out of concern for the safety of

his family and his business, although recognizing his obligation

to give truthful testimony if subpoenaed and granted use

immunity under 18 U.S.C. § § 6001 et seq. (R. 5, R. 6).

C. The First Indictment and The Immunized Testimony

On July 24, 1979, an indictment was handed up in the

Southern District of New York charging Mr. Seregos with four

counts of mail fraud (18 U.S.C. § 1341) and one count of

conspiracy to commit mail fraud (18 U.S.C. § 371), arising out

of his involvement in the kickback arrangement between

Pierson and Weeks (R. I). Within an hour of its filing, Mr.

Seregos was granted use immunity and appeared before the

Grand Jury which had just indicted him (R. 8). He testified

not only about his involvement with Scotto but also revealed

that he had been forced to make payments to employees of

Hellenic Lines, one of Jackson Engineering’s customers, in order

to retain its business (H.GX. 2; R. 5, R. 6).

In the fall of 1979, Mr. Seregos testified for three days as

a Government witness under grant of use immunity at the

Scotto trial in the Southern District of New York (R. 17 at 4).

See United tates v. Scotto, 641 F.2d 47 (2d Cir. 1980), cert.

denied, 101 S.Ct. 3109 (1981).

5

In addition to matters involving Scotto, Mr. Seregos was cross

examined at length about (1) the facts underlying his own

indictment; (2) his Hellenic Lines payments; and (3) his sworn

testimony before the Waterfront Commission in 1976, which

he admitted was false. Jd. His appearanc. was given extensive

coverage in the New York Times.“ Id. at 5.

D. Post Indictment Proceedings and Trial

Following Mr. Seregos’ July, 1979 indictmei:* on mail

fraud charges, the Government secured a postponement of Mr.

Seregos’ trial “in the interests of justice” until after the Scotto

trial (R. 4). Thereafter, two of the four substantive counts were

dismissed on the Government’s concession that venue did not

lie in the Southern District of New York (A. 12). The other

counts were abandoned when defense counsel brought to the

Government’s attention that none charged an offense under the

mail fraud statute as construed in United States v. Maze, 414

U.S. 395 (1974) (Tr. 430-31).**

On February 29, 1980, the Government obtained a super-

seding indictment charging Mr. Seregos in two counts with

conspiracy to violate the Travel Act (Title 18, United States

Code, Section 1952), in violation of Title 18, United States

Code, Section 371, and with a substantive violation of the

Travel Act, alleging that he had traveled in interstate commerce

to facilitate the payment of an $18,000 commercial bribe, in

violation of N.Y. Penal Law §§ 180.03 and 180.08 (R. 10).

*The District Court declined to permit either the transcript of Mr.

Seregos’ immunized Scotto testimony or the New York Times reports of

it to be made part of the record of the Kastigur hearing, finding the

connection between these items and the government’s evidence during the

Kastigar hearing to be at best speculative. . .” (A. 27). A copy of the

September 29, 1979 Times article was printed in an appendix to Mr.

Seregos’ main brief in the Court of Appeals, and that Court was requested

to take judicial notice of it pursuant to Rule 201 of the Federal Rules of

Evidence.

**A nolle prosequi was entered as to these counts during the pen-

dency of the case before the Court of Appeals.

6

Trial began on March 27, 1980, and concluded on April 2,

1980, when the Court found Mr. Seregos guilty on both counts.

E. The Kastigar Hearing

The District Court deferred the Kastigar hearing, which the

Government conceded was required, until after trial (A. 11-12).

The Government’s proof at the hearing consisted of the record

before the Grand Juries that had returned the two indictments

and the testimony of Assistant U. S. Attorney Mescon, who

conducted the prosecution, and of Special Agent Cassidy of the

F. B. I., the “case agent” (H.GX. I and 2).

The record before the Grand Jury showed that the evi-

dence in the Government’s case-in-chief at trial came from

witnesses and documents identified prior to Mr. Seregos’

immunized testimony, which followed his first indictment

(H. Tr. 10-12; H.GX. 1).

Assistant U. S. Attorney Mescon testified that the Kastigar

problem had been recognized from the outset and that once it

had been decided to indict Mr. Seregos, the United States

Attorney, Mr. Fiske,* instructed Mr. Mescon to avoid any

exposure to Mr. Seregos’ immunized Grand Jury or trial testi-

mony in the Scotto case. Mr. Mescon as a consequence did not

discuss Mr. Seregos with any other prosecutors working on the

Waterfront investigation, did not read Mr. Seregos’ immunized

Grand Jury or trial testimony in the Scotto case or newspaper

reports of the case, and did not discuss Mr. Seregos’ involve-

ment in the Scotto case with anyone except Special Agent

Cassidy (H.Tr. 10, 18-20).

Nevertheless, Mr. Mescon admitted that the Government’s

decisions to seek the postponement of Mr. Seregos’ trial until

after the Scotto trial and its refusal of a disposition of the

charges against Mr. Seregos after the Scotto trial had been made

by Mr. Fiske and Assistant U. S. Attorney Levine, both of

*Mr. Fiske tried the Scotto case, assisted by Assistant United States

Attorney Alan Levine, who had taken Mr. Seregos’ immunized testimony

before the Grand Jury (H. Tr. 37; H.GX. 2). The decision to obtain the

indictment against Mr. Seregos was made by Mr. Fiske (H. Tr. 45, 47).

7

whom were necessarily fully aware of the content of Mr.

Seregos’ immunized testimony from having conducted the

Scotto trial (H. Tr. 131-34, 71-74, 117-18). The record also

showed without contradiction that the Government’s stated

reason for refusing to reduce or dismiss the charges against

Mr. Seregos had been because of the nature of his admissions in

his immunized testimony (H.Tr. 71-74, 117-18, 137-39).*

In addition, Mr. Mescon admitted that his decision at Mr.

Seregos’ trial not to call Montella as a rebuttal witness, made

just before Mr. Seregos’ cross examination began, was reached

in consultation with Mr. Fiske and Mr. Levine** (H. Tr. 32-

33, 128-29).

Mr. Mescon testified that, shortly before trial, Special

Agent Cassidy informed him of Mr. Seregos’ Waterfront Com-

mission testimony, claiming to have learned of Mr. Seregos’

appearance before the Commission from electronic surveillance,

conducted before Mr. Seregos was immunized, “in which Mr.

Seregos was discussed” (H. Tr. 20-24, 55). He testified also that

his cross examination of Mr. Seregos concerning payments to

Hellenic Lines employees had been suggested by Cassidy the

day before Mr. Seregos was cross examined, and that this was

his first knowledge of the subject (H. Tr. 78-80, 118). Mr.

Mescon did not inquire what information prompted Cassidy’s

suggestion (H. Tr. 119).

et was stipulated that, if called as a witness, defense counsel

would have testified that at a meeting with Mr. Fiske and his Assistants,

including Mr. Mescon, following the Scotto trial, one of the reasons given

for the Government's rejection of a disposition of the charges “was the

information that Mr. Seregos had revealed while under his grant of

immunity. . .”, a ground defense counsel further said had been advanced

as “the principal one” by Mr. Mescon in their telephone conversation the

day after the meeting (H. Tr. 139). When asked at the Kastigar hearing

whether he recalled saying that in the telephone conversation, Mr. Mescon’s

response was: “I don’t, but I don’t recall not telling you that either.”

(H. Tr. 74).

**Mr. Montella, who had also been a Government witness at the

Scotto trial, was at the time in the Federal Witness Protection Program

(H. Tr. 129-130).

In his testimony, Special Agent Cassidy never explained

the source of his suggestion about the Hellenic Lines payments.

In contrast to Mr. Mescon, Cassidy claimed to have learned

about Mr. Seregos’ Waterfront Commission testimony from a

recording made by Montella of a conversation with Mr. Seregos

in August, 1978, but he did not disclose what or who had

led him to consult that recording (H.Tr. 95-96). Finally,

Cassidy admitted that his instructions for avoiding taint were

that he should not discuss “matters about Mr. Seregos as they

pertained to things happening post-indictment,” but that

Aal nything prior to that we discussed.” (H. Tr. 88-89, 103).

Cassidy also said that he had been involved in the prosecution

and trial preparation of the Scotto case and had “sat with

Montella kind of on a daily basis.” (H. Tr. 85-87, 102).

F. The Motion under Rules 12 and 34 of the Federal Rules

of Criminal Procedure

After the verdict, Mr. Seregos made a timely motion in

arrest of judgment and for dismissal of the indictment (R. 26,

R. 27 at 3 n. I) on the grounds that the evidence at trial showed

that all of his conduct had taken place in the latter part of

1976, after the decision of the Court of Appeals in United

States v. Brecht, 540 F.2d 45 (2d Cir. 1976), cert. denied, 429

U.S. 1123 (1977), holding that a Travel Act prosecution could

not be predicated, as this one was, on violation of the New

York commercial bribery statute, and that the retroactive

application of this Court’s contrary decision in Perrin v. United

States, 444 U.S. 37 (1979), overruling Brecht three years later,

violated the Due Process Clause of the Fifth Amendment.

Marks v. United States, 430 U.S. 188 (1977).

G. The Opinions of the District Court

The District Court denied the motion in arrest of judgment

on the ground that Rule 12 required the Due Process claim be

raised before trial (A. 28-32). It did not address the merits of

the claim.

neither Mr, Mescor nor Special Agent Cassidy had known “the

‘substance’ of Mr, Seregos’ immunized testimony (A, 23)

The District Court gave no consideration to the admitted use

of that testimony in making prosecutorial decisions or to the

involvement in such decisions of those who were fully aware of

the content of such testimony, It also did not address the

Government's failure to show that its cross examination of Mr,

Seregos about the Hellenic Lines payments and his Waterfront

Commission testimony derived from sources untainted by his

immunized testimony,

H, The Opinion of the Court of Appeals

The Court of Appeals, although recognizing that the

Kastigar claims did not concern the Government's direct case

at trial, did not discuss those claims and affirmed on the find-

ings of the District Court,

On the Due Process claim, the Court of Appeals appar:

ently disagreed with the District Court's conclusion that the

point had to have been raised before trial, an issue which its

opinion did not address, Instead, the Court of Appeals rejected

the claim on the merits on three grounds, First, the Court

relied on this Court's decision in Perrin „, United States, supra,

as clearly demonstrating that the Travel Act nad been intended

to include commercial bribery as U predicate offense, Second, it

pointed to an earlier decision of the United States Court of

Appeals for the Fourth Circuit, United States v, Pomponio, $11

F. 2d 953 (4th Cir,), cert, denied, 423 U8, 874 (1975), which

the Second Circuit expressly refused to in Brecht,

holding that the Travel Act did apply to the New York com-

mercial bribery statute, Finally, the Court held that, given its

10

REASONS SUPPORTING ISSUANCE

OF THE WRIT

This petition raises two issues of general importance to the

administration of justice, both arising under the Fifth Amend-

ment.

1. The proper application of Kastigar v. United States,

supra, touches fundamental values of our society. 406 U.S. at

444, In enacting the use immunity statute, the Congress

stripped away a valued constitutional right in return for what

the Court emphatically required in Kastigar must be its full

equivalent, To permit the Government to treat its obligations

under Kastigar as merely symbolic, as the lower courts have

done here, will erode the standard set by Kastigar, confirmed

in New Jersey v. Portash, 440 U.S. 450 (1979), and correctly

applied in United States v. McDaniel, 482 F.2d 305, 311

(8th Cir, 1973), a standard from which the Court of Appeals

on this record necessarily departed. This case offers the Court

the opportunity not only to correct a dangerous erosion of the

principles of Kastigar and Portash but also to settle that those

principles extend outside the courtroom to bar the use of

immunized testimony in making prosecutorial decisions and

tactical judgments in a subsequent prosecution of the immun-

ized witness.

2. The Court of Appeals has permitted the retroactive

application of this Court's construction of the Travel Act in

Perrin . United States, supra, to conduct which, when per-

formed, was not prohibited by the statute as construed in con-

trolling precedent, United States v. Brecht, supra. Such a ruling

departs from settled constitutional principles. Marks v. United

States, supra; Boule v. City of Columbia, 378 U.S. 347 (1964).

It is in direct conflict with a decision of the United States

Court of Appeals for the Ninth Circuit filed only one day

earlier, United States v. Goodheim, 651 F. 2d 1294 (9th Cir.

1981), and with United States ex rel Clark „ Anderson, 502

F. 2d 1080 (3d Cir. 1974) (Hastie J.). The result reached by the

Court of Appeals calls into question fundamental constitutional

principles nearly as old as the Court itself, Calder v, Bull, J Dall,

386 (1798), and reaffirmed as recently as the last Term. Weaver

„ Graham, 450 U.S, 24 (1981).

The Court of Appeals has Departed from the Require-

ments of Kastigar.

The familiar teachings of Kastigar are that both statutory

provision and constitutional requirement prohibit the Govern-

ment from using “in any respect,” 406 U.S. at 453 (emphasis

in original), a witness’s immunized testimony in connection

with his subsequent prosecution, The “heavy” burden of

showing that no such use has been made is imposed on the

Government, and its discharge requires not only the negation of

taint, but also an affirmative demonstration that the Govern-

ment's case has been derived from sources wholly independent

of the immunized testimony, 406 U.S. at 460.

The constitutional and statutory bar against any use of

immunized testimony clearly extends beyond the Government's

direct case at trial and includes cross examination of the defen-

dant. New Jersey v. Portash, supra, Kastigar also shows that

subtler forms of use outside the courtroom—“leads, names of

witnesses, or other information not otherwise available, . are

similarly embraced in the statute's constitutionally mandated

“sweeping proscription of any use, direct or indirect, of the

compelled testimony and any information derived therefrom.”

406 U.S, at 459-460, The breadth of this prohibition has been

correctly understood by the United States Court of Appeals for

the Eighth Circuit as potentially including assistance in focus

ing the investigation, deciding to initiate prosecution, refusing to

plea-bargain, interpreting evidence, planning cvoss-examination,

and otherwise generally planning trial strategy.” United States

v. McDaniel, supra, 482 F. 2d at 311,

The record before the Court of Appeals in this case estab-

lished that the United States Attorney had refused to agree to a

favorable disposition of the charges, following Mr. Seregos’

immunized testimony at the Scotto trial, on the stated ground

12

of the admissions made in his immunized testimony (H.Tr. 71-

74, 117-18, 137-39). It also showed that critical trial strategy

was planned by the prosecutor in consultation with the United

States Attorney and another Assistant United States Attorney

who had conducted the Scotto trial and the Grand Jury pro-

ceedings at which Mr. Seregos testified at length under grant of

use immunity (H. Tr. 32-33, 128-29, 131-34). Finally, the

record reflected that two of the subjects of cross examination

with the greatest impact on the District Judge at this bench

trial were Mr. Seregos’ payments to Hellenic Lines employees

and his admittedly false testimony before the Waterfront Com-

mission, both of which had been revealed in his immunized

testimony (R. 17; H.GX. 2; Tr. 720-21; A. 14-15). No untainted

source—indeed no source at all—was offered at the Kastigar

hearing for the questioning about the Hellenic Lines payments,

and the source advanced for the Waterfront Commission testi-

mony was the subject of inconsistent and incomplete testimony.

(Compose H. Tr. 22-23 with H. Tr. 95-96, 100-101).

The District Court passed over all of this in silence, and the

Court of Appeals, although recognizing the nature of Mr.

Seregos’ claims, could “see no reason to question” findings

which the District Court had never made (A. 10). Although in

this case the violence to the constitutional principles announced

in Kastigar is hidden by the silence of the lower courts, that

fact lessens not at all the conflict between the decisions below

and those in Kastigar, Portash and McDaniel.

Two further reasons suggest the appropriateness of the

Court’s exercise of its discretionary jurisdiction.

First, from the time that it was decided to indict Mr.

Seregos to enhance his credibility as an immunized Govern-

ment witness against Scotto, the United States Attorney, his

Assistants, and the F. B. I. were well aware of the Kastigar

problem thus created. Thus, in contrast to the usual case, the

failure to comply with Kastigar’s requirements lacks the sym-

pathetic circumstance of the recognition by the Government of

a duty to prosecute an immunized witness unforeseen at the

time that it was exposed to his immunized testimony. Here, the

Government proceeded from the outset with a full awareness of

13

its Kastigar obligations, or perhaps, judging from Cassidy’s

transparently inadequate instructions, despite them.

Second, the integrity of the constitutional imperatives of

Kastigar is crucial to the administration of justice. There is no

other instance in which the law provides a compulsory substi-

tute for a recognized constitutional privilege. The constitution-

ality of the immunity statute rests upon the Court’s conclusion

in Kastigar that it “is coextensive with the privilege and suffices

to supplant it.” 406 U.S. at 462. Its erosion, even in the studied

silence which pervades the opinions below, jeopardizes not only

the rights of citizens to whom it is applied but also its continued

availability as a legitimate tool in the fight against crime.

The Ex Post Facto Application Of The Travel Act To

Mr. Seregos Violated The Due Process Clause.

Having originally been indicted on mail fraud charges the

Government could not prove, Mr. Seregos was subsequently

charged and convicted in the Southern District of New York for

a substantive violation of the Travel Act and for conspiracy to

violate the Travel Act. The state law predicate for both counts

was commercial bribery in violation of the N, Y. Penal Law

§ § 180.03 and 180.08.

Both the indictment and the proof at trial, taken most

favorably to the Government, showed that Mr. Seregos’ involve-

ment had begun no earlier than August or September, 1976

(Tr. 51-52, 54) and concluded in December, 1976.

On July 16, 1976, prior to any act by Mr. Scregos in this

case, the United States Court of Appeals for the Second Circuit

had held in United States v. Brecht, supra, that the Travel Act

did not apply to acts of commercial bribery in violation of the

New York Penal Law. The decision of the Court of Appeals in

Brecht, of which the Government did not seek review in this

Court,* remained the law of the Second Circuit for over three

*The denial of certiorari noted in the citation to Brecht is of

Brecht's petition for review of his Hobbs Act conviction, which the Court

of Appeals had affirmed.

14

years until this Court held that the Travel Act did apply to

commercial bribery and in substance overruled Brecht. Perrin v.

United States, supra.

The District Court described the circumstances of the

superseding indictment as follows:

The superseding indictment filed on February 29, 1980

was merely designed to change the government’s legal

theory from one based upon the mail fraud statute to one

based upon the Travel Act, following a Supreme Court

decision in United States v. Perrin (sic), 48 U.S.L.W. 4009

(November 27, 1979), which changed the law in this

Circuit.

(A. 23). But whatever the Government’s purpose, the retro-

active application of the construction of the Travel Act in

Perrin to Mr. Seregos’ conduct three years earlier, at a time

when Brecht was the governing law, violated the Due Process

Clause of the Fifth Amendment under Boule v. City of Colum-

bia, supra, and Marks v. United States, supra, which teach that

“an unforeseeable judicial enlargement of a criminal statute,

applied retroactively, operates precisely like an ex post facto

law, such as Art. I, § 10, of the Constitution forbids.” Boule v.

City of Columbia, supra, 378 U.S. at 353, quoted with approval

in Marks v. United States, supra, 430 U.S. at 192. See also

Douglas v. Buder, 412 U.S. 430 (1973).

Bouie, in which the “foreseeability’’ test was formulated,

involved the “expansive construction,” Marks v. United States,

supra, 430 U.S. at 195, of a state criminal statute to conduct to

which it had not been previously applied, although no prece-

dent stood in the way. There the Court examined the language

of the statute and its application for the preceding century to

determine whether these gave sufficient warning, that is, made

it “foreseeable,” that the statute would be construed to forbid

the conduct of the petitioners in that case. Answering that

question in the negative, the Court held that the Due Process

Clause precluded application of the statute to petitioners’

conduct.

15

Marks posed a similar issue but with the added element,

present in this case but not in Bouie, that the newly expanded

construction of the statute overturned existing precedent to the

contrary. In Marks the Court found the Bouie test of foresee-

ability satisfied simply by its determination that the most

recent definition of obscenity in Miller v. California, 413 U.S.

15 (1973), criminalized conduct under 18 U.S.C. § 1465 which

had been beyond the scope of the statute under the Court’s

earlier formulation in Memoirs v. Massachusetts, 383 U.S. 413

(1966). Because of its conclusion that, under the new Miller

standard, “some conduct which would have gone unpunished

under Memoirs would result in conviction under Miller”, the

Court held in Marks that “the Due Process Clause precludes the

application to petitioners of the standards announced in Miller

v. California, to the extent that those standards may impose

criminal liability for conduct not punishable under Memoirs.”

430 U.S. at 194, 196.

Precisely this principle precludes the application to Mr.

Seregos of the construction of the Travel Act announced in

Perrin v. United States, supra, to the extent that it imposes

criminal liability for conduct not punishable under Brecht, for

there is no dispute that under Brecht the Travel Act did not

then apply to what Mr. Seregos has been convicted of doing.

While Brecht was not, as Memoirs was, a decision of this Court,

that fact is immaterial to the application of the constitutional

principle. United States v. Peltier, 422 U.S. 531, 541-42 (1975).

See also United States v. Goodheim, supra; United States v.

Potts, 528 F.2d 883, 886 (9th Cir. 1975) (en banc).

The rule of law for which we contend is precisely that

adopted by the Ninth Circuit in Goodheim. There the Court

of Appeals held that Bouie and Marks precluded the retroactive

enforcement in that Circuit of a decision of this Court which

overruled the restrictive construction of the predicate felony

provisions of the federal firearms laws followed in the Ninth

Circuit, and which adopted instead a more expansive reading of

those statutes favored by other Courts of Appeals. In this case,

the Second Circuit has taken the opposite position in an indis-

tinguishable context on grounds that do not survive even

cursory analysis.

16

First, relying with hindsight on Perrin, the Court of

Appeals found that “there is nothing vague or indefinite about

‘bribery’ as used in the Travel Act. (A. 7). Such a suggestion

is sufficiently refuted. by the fact that in the three cases in the

Court of Appeals prior to this Court’s decision in Perrin, United

States v. Pomponio, supra; United States v. Brecht, supra; and

United States v. Perrin, 580 F.2d 730 (Sth Cir. 1978), the

judges of the Courts of Appeals had divided five to four on

whether “bribery” in the Travel Act was meant to include com-

mercial bribery. The uncertainty was no greater in Goodheim.

Second, the Court of Appeals thought that Perrin could

not be viewed as “unforeseeable” within the meaning of Bouie

because of the Fourth Circuit’s conclusion in United States v.

Pomponio, supra, that the Travel Act applied to commercial

bribery. However, this view of retroactivity, diametrically

opposed to the Ninth Circuit’s in Goodheim, both ignored that

it was Brecht, and not Pomponio, which was the law of the

Second Circuit until Perrin and necessarily read Bouie too

narrowly for contexts where, as here and in Marks, what is

involved is the overruling of controlling precedent and not

merely an expansive interpretation of a statute by a court

writing on an arguably clean state. Moreover, the view that a

Due Process claim resting on Brecht was foreclosed by the con-

trary view of the Fourth Circuit in Pomponio overlooked that

Marks was written against the background of a splintered

division of the Court, see id. at 193-194 and Miller v. California,

supra, 413 U.S. at 20-22, and that judicial disagreement on the

scope of a statute does not supply the “clear and definite state-

ment of the conduct proscribed,” United States v. Persky, 520

F.2d 283, 288 (2d Cir. 1975), required by the Due Process

Clause. Indeed, the. uncertainty prior to Miller was as clearly a

harbinger of doctrinal change as the disagreement between the

Fourth and Second Circuits on the scope of the Travel Act, but

Marks shows that such premonitions are no basis for criminal-

izing conduct retrospectively. The “speculative anticipation of a

series of future judicial rulings is not the stuff out of which

adequate notice can be fashioned.” United States ex rel. Clark

v. Anderson, supra, 502 F.2d at 1083.

17

Finally, the Court of Appeals found that a retroactive

application of Perrin’s expansive construction of the Travel Act

was authorized by its conclusion that Mr. Seregos’ conduct

violated the New York commercial bribery statute. However,

the contrary is clearly shown by the principle underlying Bouie

that the required criminal law must have existed w.ien the

conduct in issue occurred. 378 U.S. at 354. See also United

States v. Goodheim. It is also demonstrated by this Court’s

refusal to borrow precedent from other jurisdictions or from

local tort law to sustain the retroactive application of the

expansive construction of the statute at issue in Bouie v. City of

Columbia, supra, 378 U.S. at 357-60, anc by persuasive author-

ity which has rejected the same position taken here by the

Court of Appeals in a context analytically more sympathetic

to it. United States ex rel. Clark v. Anderson, supra.

Moreover, Mr. Seregos was convicted, not of commercial

bribery, but rather of the quite different offense of “‘interstate

travel with the intent to ‘promote, manage, establish, carry on,

or facilitate’ certain kinds of illegal activity,” Rewis v. United

States, 401 U.S. 808, 811 (1971). The prohibitions of the

former can hardly be said to authorize retroactive application of

the latter, particularly in light of the substantially greater penal

and civil consequences of conviction under a federal felony

statute, rather than a state law misdemeanor provision. See

Bouie v. City of Columbia, supra, 378 U.S. at 353; Calder v.

Bull, supra, 3 Dall. at 390. Furthermore, since in imposing

penalties for violation of the Travel Act the United States acts

as a separate sovereign enforcing its own laws, Abbate v. United

States, 359 U.S. 187 (1959), its constitutional obligation to give

fair notice of what its law forbids can hardly be satisfied by

reference to the notice provided by a different sovereign for a

violation of such a different character. See Bouie v. City of

Columbia, supra, 378 U.S. at 353 n.4. Instead, since the con-

stitutional issue here arises because of ambiguity in the definition

in Section 1952(b) of state law predicate offenses under the

Travel Act, the existence of a state law against commercial

bribery, far from supplying fair notice of the breadth of the

Travel Act, is simply irrelevant. See Rewis v. United States,

supra, 401 U.S. at 811-12.

18

CONCLUSION

If permitted to stand, the decision of the Court of Appeals

will create uncertainty and perpetuate division in the Circuits

about two fundamental and recurring issues of Constitutional

principle. The decision of the Court of Appeals departs substan-

tially from settled authority of this Court and from the decision

of other Courts of Appeals which have adhered to it.

For the foregoing reasons, the petition for a writ of

certiorari should be granted.

Respectfully submitted,

JOHN D. GORDAN, III

LAURIE E. FOSTER

25 Broadway

New York, New York 10004

(212) 344-8480

Attorneys for Nicholas Seregos

APPENDIX

A. 1

UNITED STATES COURT OF APPEALS

For THE SECOND CIRCUIT

+

No. 732—September Term, 1980

(Argued February 24, 1981 Decided July 28, 1981)

Docket No. 80-1403

—

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

—v.—

NICHOLAS SEREGOS,

Defendant-Appellant.

Before:

FEINBERG, Chief Judge,

Oakes, Circuit Judge, and

NEAHER, District Judge.*

—

Appeal from a judgment of conviction entered after a

bench trial in the United States District Court for the

- Honorable Edward R. Neaher, Judge of the United States District

Court for the Eastern District of New York, sitting by designation.

A. 2

Southern District of New Vork, Lawrence W. Pierce,

Judge, convicting appellant of conspiracy to violate the

Travel Act, 18 U.S.C. §§ 1952 and 371, and of a substan-

tive violation of that Act.

Affirmed.

*

Jom D. Gorpban, III, New York, N.Y.

(Laurie E. Foster, of Counsel), for De-

Sendant-Appellant.

RICHARD A. MESCON, Assistant United States

Attorney, New York, N.Y. (John S. Mar-

tin, Jr., United States Attorney for the

Southern District of New York, New

York, N.Y., of Counsel; Mary Jo White,

Assistant United States Attorney, on the

Brief), for Appellee.

*

NEAHER, District Judge:

This appeal presents another facet of the unlawful

activiy “that has plagued waterfront businesses in New

York and New Jersey.” See United States v. Clemente, 642

F.2d 1069, 1071 (2d Cir. 1981). The actors here were all

businessmen on the waterfront who might have been

expected to shun the illicit conduct which led to appel-

lant’s indictment and conviction.

Appellant (hereinafter “Seregos”) was convicted after a

bench trial in the Southern District of New York before

Lawrence W. Pierce, J., for traveling from New Jersey to

New York to facilitate the payment of a commercial bribe

and conspiracy to commit that offense, 18 U.S.C.

56 1952, 2 and 371, in connection with a business trans-

A. 3

action between a shipping company and a stevedoring

concern. Since appellant challenges th. sufficiency of the

evidence to support his conviction, a more detailed recital

of the essential facts established at trial is required. The

evidence must, of course, be viewed in the light most

favorable to the government. Glasser v. United States,

315 U.S. 60, 80 (1942).

In 1976, and for some years before, Seregos was

president of Jackson Engineering Co., a ship repair

business founded by his father in Hoboken, New Jersey,

in which State Seregos lives and works. Seregos’ difficul-

ties began when he was induced to assist the carrying out

of a corrupt kickback arrangement between two other

businessmen, who later testified against him at trial after

pleading guilty to mail fraud charges. One of these

businessmen was Edward Pierson, then an executive of

Moore-McCormack Lines, whose terminal and office was

in Brooklyn; the other was Richard Weeks, president of

Weeks Stevedoring Co., headquartered in New Jersey.

In 1973 Pierson and Weeks had negotiated the rental of

a Weeks Stevedoring Co. floating crane for use by Moore-

McCormack during a two-year period with three six-

month renewal options. The rental to be paid Weeks was

$15,500 monthly, a figure that included a $1500 per

month kickback to Pierson to be paid in cash. Weeks had

difficulty raising the cash to make the kickback payments

and by 1976 had fallen behind by some $18,000. Pierson

then sought the assistance of William Montella,' who

suggested that Seregos might be able to provide a false

invoice that Pierson proposed as a way to raise cash for

Weeks.

' Montella, an employee of Quin Marine Division of McGrath Indus-

tries, was a key government witness in United States v. Scotto, 641

F.2d 47 (2d Cir. 1980), cert. denied, 49 U.S. L. W. 3954 (U.S. June 22,

1981), and United States v. Clemente, supra.

A. 4

Seregos, testifying in his own behalf, denied knowledge

of the illicht arrangement between Weeks and Pierson,

maintaining that his only contacts were with Montella,

not Pierson, He admitted, however, that after a series of

telephone conversations with Montella and an inspection

of the Weeks crane at Moore-McCormack’s Brooklyn

termir ul, he submitted a Jackson Engineering Co, invoice

to Weeks Stevedoring for repairs to the crane totaling

$25,795, which in fact were never performed, The books

of Jackson Engineering and other trial exhibits reflected

that the invoice was paid by Weeks by check dated

December 2, 1976,

Seregos also admitted that on December 3 he prepared

two Jackson Engineering checks, each in the amount of

$9,027,50, one drawn to James Cannino and the other to

Alvin Raphael, He testified he gave both to Cannino on

December 7 and received a package containing $18,000 in

cash, which he then delivered to Montella in Brooklyn.

Seregos further admitted meeting Pierson and Montella

that night at Ponte’s restaurant in Manhattan, but testi-

fied he stayed only five minutes and there was no discus-

sion of money

Pierson, testifying for the government, contradicted

Seregos’ disclaimer of knowledge regarding the kickback

arrangement, According to Pierson, Seregos came to his

office at the Moore-MeCormack terminal in Brooklyn, in

August or September 1976, where Pierson told him that

he “had a private arrangement with Mr, Weeks, and |

needed an invoice because he had to pay me some money

„ and could he, Mr, Seregos, write up an invoice on

A. 5

was Seregos who arranged to meet him at Ponte’s restau-

rant and delivered to him in the men’s room the envelope

containing the $18,000 in cash.

The conflict in the testimony bearing upon Seregos’

knowledge and intent obviously presented an issue of

credibility for the trier of the fact. United States v. Minor,

398 F.2d 511, 512 (2d Cir. 1968), , 396 U.S. 87

(1969). In resolving that issue against Seregos, Judge

Pierce properly considered appellant’s demeanor, his

qualificd answers and his admitted false testimony under

oath before the Waterfront Commission, as well as the

inferences that could reasonably be drawn from Seregos’

readiness to participate in plainly dishonest conduct.

Factual findings by the trial judge as to the requisite

knowledge and intent to engage in unlawful conduct may

not be set aside unless on review of the record they are

found to be clearly erroneous. United States v. Rischard,

471 F.2d 105, 107 (8th Cir. 1973); see United States v.

Abel, 258 F.2d 485, 494 (2d Cir. 1958), aff'd, 362 U.S.

217 (1960). See also United States v. Sheard, 473 F.2d

139, 146 (D.C. Cir. 1972), cert. denied, 412 U.S. 943

(1973). On this record such a finding cannot be made,

and the critical issues of credibility having been resolved

against appellant, the evidence was clearly sufficient to

establish all elements of the offenses charged.

We now turn to the three principal arguments advanced

by appellant, none of which we conclude warrants rever-

sal of his conviction.

Lack of Fair Notice

Appellant contends that he did not have fair notice that

his conduct in the latter part of 1976 was in violation of

the Travel Act. That contention is premised on this

Court’s decision on July 16, 1976, in United States v.

A. 6

Brecht, 540 F.2d 45 (2d Cir. 1976), cert. denied, 429 U.S.

1123 (1977), holding that the Travel Act did not apply to

acts of commercial bribery in violation of the New York

Penal Law. The Brecht court, however, acknowledged

that its ruling was in conflict with the prior decision of

the Fourth Circuit in United States v. Pomponio, 311

F. 2d 953 (4th Cir.), cert. denied, 423 U.S, 874 (1975), id.

at 48, which had held that the Travel Act applied not only

to bribery of public officials but extended to interstate

travel to facilitate commercial bribery as defined in N.Y.

Penal Law § 180.00, the predecessor of the statutes in-

volved in this case, 511 F.2d at 955-56,

This Court's decision in Brecht was subsequently over-

ruled by the Supreme Court in Perrin v. United States,

444 U.S. 37, decided Novem er 27, 1979, which, after

noting the conflict among circuits, upheld the views of the

Fourth and Fifth Circuits that bribery of private employ-

ees prohibited by State criminal statutes could also violate

the Travel Act. See United States v. Pomponio, supra,

and Perrin v. United States, 580 F. 2d 730 (Sth Cir. 1978).

Following the Supreme Court's ruling in Perrin, the

government filed a superseding indictment on February

29, 1980, charging appellant with the Travel Act offenses

of which he was convicted.’ Relying on Boule v. City of

Columbia, 378 U.S. 347 (1964), and Marks v. United

States, 430 U.S. 188 (1977), his basic contention is that

the Perrin ruling was “an unforeseeable judicial enlarge-

ment of a criminal statute,” which, when “applied re-

troactively, operates precisely like an es post facto law”

forbidden by the Constitution, quoting from Boule, su-

pra, 378 U.S. at 353. Our reading of those cases satisfies

2 was originally indicted July 24, 1979 on five counts of mail

fraud on the same transactions as the Travel Act charges.

A.7

us that they provide no support for a claim of lack of fair

warning here. Granted that the deprivation of such a right

can result from “vague statutory language” or “an un-

foreseeable and retroactive judicial expansion of narrow

and precise statutory language,” Bowie, supra, at 352,

neither element is present in this case.

As the Supreme Court pointed out in Perrin, at the

time the Travel Act was enacted in 1961, both “federal

and state statutes had extended the term bribery well

beyond its common law meaning.” 444 U.S. at 43. And

New York as early as 1905 was one of the States which

had outlawed commercial bribery generally. Id. at 44, n.9.

Thus there is nothing vague or indefinite about “bribery”

as used in the Travel Act; nor can Perrin be viewed as an

unforeseeable judicial expansion of the scope of the Act

in light of Pomponio, supra, which dealt specifically with

the New York commercial bribery statute. And in view of

Seregos’ admittedly illicit activities, which we conclude

below violated that statute, the argument that he was

denied fair notice must be rejected.’

Absence of “Bribery” Under State Law

Appellant argues next that the underlying transaction

between Weeks and Pierson that he facilitated did not

constitute the crime of commercial bribery under State

law. Essentially he contends that the kickback payment

arrangement was actually either a fraud upon or embez-

zlement from Moore-McCormack and lacked the element

A. 8

of “intent to influence” necessary for commercial bribery

under the New York statute.‘

We disagree. Accepting as we must the trial court’s

findings that the $1500 monthly kickback paid by Weeks

to Pierson personally was an integral part of the negotia-

tions resulting in the crane rental agreement, without the

knowledge or consent of Pierson’s employer, all the

requisite elements of commercial bribing and commercial

bribe receiving were present. Section 180.03 is drawn in

terms of conferſring] any benefit” upon an “employee,

agent or fiduciary. . . with intent to influence his con-

duct in relation to his employer s.. . affairs... .”

Weeks’ conduct precisely satisfied those terms. By agree-

ing to Pierson’s proposal, Weeks not only assured the

contract for his company but also provided the means

whereby Pierson could receive the benefit of the kickback

payments unknown to his employer. And Weeks’ acquies-

4 N.Y. Penal Law criminalizes both the giving and receiving of a

commercial bribe in separate provisions as follows:

Ҥ 180.03 Commercial briting in the first degree

A person is guilty of commercial bribing in the first degree when

he confers, or offers or agrees to confer, any benefit upon any

employee, agent or fiduciary without the consent of the latter's

employer or principal, with intent to influence his conduct in

relation to his employer's or principal's affairs, and when the value

of the benefit conferred or offered or agreed to be conferred

exceeds one thousand dollars.”

Ҥ 180.08 Commercial bribe receiving in the first degree

An employee, agent or fiduciary is guilty of commercial bribe

receiving in the first degree when, without the consent of his

— L NN

understanding

A.9

cence in the scheme clearly influenced Pierson to commit

Moore-McCormack to rent the crane at the higher

monthly rate.’ That the source of the funds was Pierson’s

employer does not mean that Weeks and Pierson were not

engaging in commercial bribery. See Palmer v. Doull

Miller Co., 233 F. 309, 312 (S. D. N. V 1916) (construing

predecessor bribery statute, N.Y. Penal Law § 439, as

condemning scheme to charge corporate customer in-

flated factor’s commissions so as to provide undisclosed

payments by factor to customer’s president). Concluding

that the arrangement for the kickback payments was

commercial bribery under New York law, we find it

unnecessary to consider whether such conduct also vio-

lated other criminal laws, as appellant suggests.

Impermissible Use of Immunized Testimony

Appellant’s final argument accuses the government of

having cross-examined him at trial regarding matters as to

which he had previously testified under a grant of immu-

nity before the grand jury which indicted Anthony Scotto

and as a government witness at Scotto’s trial.* In addi-

tion, Seregos claims that the government’s decisions not

to renew an offer of a misdemeanor plea he had pre-

viously rejected, and not to call William Montella as a

rebuttal witness at his trial, were also tainted by knowl-

edge of his immunized testimony imputable to the prose-

cutor.

In view of these allegations, Judge Pierce properly

conducted a Kastigar’ hearing to determine whether the

3 Weeks testified that absent the kickback payments to Piers wn, the

rental charge to Moore-McCormack would have been “about $14,

000.” Tr. 320.

6 See United States v. Scotto, supra, n. l.

See Kastigar v. United States, 406 U.S. 441, 460 (1972).

A. 10

government could meet its burden of showing that the

evidence used against Seregos was free from the taint of

compelled testimony. After two days of testimony from

the Assistant United States Attorney responsible for Sere-

gos’ prosecution, and the F. B. I. case agent who con-

ducted the investigation, both of whom he found “highly

credible,” Judge Pierce concluded in a detailed opinion

that the evidence against Seregos was independently de-

rived from subpoenaed records and documents and the

debriefing of Pierson and Weeks and was not tainted by

Seregos’ testimony in the Scotto case. He also found that

the prosecutor and agent had sufficiently insulated them-

selves from the Scotto proceedings and those responsible

for that prosecution. From our independent review of

that record we see no reason to question Judge Pierce’s

findings. See United States v. King, $60 F.2d 122, 131 (2d

Cir.), cert. denied, 434 U.S. 925 (1977). Accordingly, we

find this claim to be without merit.

We have considered appellant’s other contentions and

find them also to be without merit.

Affirmed.

A. 11

UNITED STATES OF AMERICA,

Plaintiff-A ppellee,

V.

NICHOLAS SEREGOS,

Defendant-A ppellant.

79 Cr. 564

United States District Court,

Southern District of New York.

Filed: February 26, 1980

ORDER

Defendant Nicholas Seregos has made a number of pre-

trial motions; the Court rules on these motions as follows:

(1) Defendant's motion to dismiss the indictment with

prejudice upon the grounds that the Government's evidence is

in part derived from the defendant’s testimony given under

orders of immunity is hereby denied. The Government, through

an uncontested affidavit, has demonstrated that the evidence

leading to an indictment in this matter was presented to the

Grand Jury prior to defendant’s immunized testimony. The

Court has conducted an in camera inspection of the minutes of

defendant’s immunized testimony and finds the Government’s

affidavit to be substantiated by the minutes. Thus, since no

immunized testimony existed at the time of the filing of the

instant indictment, it is not necessary for the Court to conduct

a hearing on this issue under Kastigar v. United States, 406 U.S.

441 (1972).

(2) A hearing is mandated with respect to the defendant's

claim that the Government's trial evidence may be tainted by

his immunized testimony. See Kastigar, supra. This hearing

A. 12

should be conducted after the jury’s verdict, should the defen-

dant be found guilty. A number of factors lead the Court to

make this discretionary decision [see Nardone v. United States,

308 U.S. 338, 342 (1939)]; the primary factors are: (a) that it

is obvious that even if there were a pre-trial taint hearing, a

post-trial hearing would still be required based upon thus far

unknown testimony which may be elicited on cross-examina-

tion and possible rebuttal evidence; and (b) to avoid giving the

defendant an unfair preview of the Government’s evidence.

(3) Defendant’s motion for an order pursuant to Rule

16 of the Fed. Rules of Civ. Proc. requiring the Government

to produce a copy of the minutes of his testimony before the

Grand Jury is denied. As stated above, the Court has made an

in camera inspection of these minutes and finds that the testi-

mony given is not related to the offenses charged in the instant

indictment. Defendant is given leave to renew this motion at the

time of the post-trial taint hearing, if one is required in this

case.

(4) Defendant is not entitled to the requested order for

production of all grand jury testimony relating to the charges

in the instant indictment, as he has not made the requisite

showing of particularized need“. United States v. Dennis,

384 U.S. 855, 870-71 (1966).

(5) Defendant’s motion for an order directing the

Government to compiy with the mandates of Brady v. Mary-

land, 373 U.S. 83 (1963) and its progeny is hereby granted.

(6) Defendant’s motion for an order adjourning the date

for filing motions is denied, but defendant is granted leave to

renew this motion, with permission of the Court, upon a

showing of good cause.

(7) Defendant’s motion for an order dismissing Counts

4 and 5 of this indictment (79 Cr. 564) is hereby granted pur-

suant to Rules 12 and 18 of the Fed. Rules of Crim. Proc., on

A. 13

the grounds that this Court is without jurisdiction over the

offenses charged, since venue does not lie in the Southern

District of New York.

SO ORDERED.

Dated: New York, New York

February 22, 1980

/s/

LAWRENCE W. PIERCE

U.S.D.J.

A. 14

UNITED STATES OF AMERICA,

Plainiiff-A ppellee,

V.

NICHOLAS SEREGOS,

Defendant-A ppellant.

879 Cr. 564

United States District Court,

Southern District of New York.

(Pages 727-732 of the Trial Transcript,

April 2, 1980)

Filed: October 31, 1980

VERDICT OF THE COURT

„„

(T. 727) THE COURT: All right.

Mr. Dearie has made a Rule 29 motion. The motion is

denied. The defendant is found guilty of counts one andtwo. .

The first issue to be addressed is that of credibility. I have

sat here and I have observed the inflections of the voices of the

witnesses, their conduct and their demeanor while testifying. I

have reviewed the testimony searching for consistencies and

inconsistencies, and while Mr. Dearie has noted Mr. Pierson’s

inability to recall certain events with great particularity, | noted

as well the inability of the defendant to recall over and over

again without the use of qualifying words so many of the

matters about which Mr. Seregos testified, seemingly constantly

hedging his answers, answers relating to where certain events

occurred, who was present, in what sequence did events occur

and what was said.

In a case involving very closely as here the issue of who to

believe, the acknowledgment by the defendant Seregos that on

A. 15

a prior occasion, while testifying under oath he lied, assumes

greater importance in resolving whether to find that witness’s

testimony credible here.

Applying one’s common sense to the evidence, (T. 728) at

least attempting to do so, and undertaking to assess how illegal

deals are worked out, the discussion of the details of criminal

acts in specific terms over the telephone on the facts presented

in this particular case is an unreasonable and unwarranted con-

clusion here in my view.

Accepting as credible the testimony of Mr. Pierson as to

what he told Mr. Seregos about the lease by Moore-McCormack

of a crane from Weeks Stevedoring Company, and the reference

to an arrangement with Richard Weeks, and the need for a

known phony invoice, I find, and the reasonable inferences

to be drawn from the evidence sufficient to establish that Mr.

Seregos knowingly and willfully traveled interstate to facilitate

and promote a violation of commercial bribery and commercial

bribery receiving statutes as set forth as prohibited in sections

180.03 and 180.08 of the New York State Penal Law.

I additionally make the following findings of fact: In May

of 1973, Moore-McCormack Lines, Inc. and Weeks Stevedoring

Company, Inc. entered into an agreement whereby Moore-

McCormack rented a floating crane from Weeks for $15,500

per month. The rental agreement was for a period of two years

to commence 90 days after the crane was delivered to Moore-

McCormack.

(T. 729) Moore-McCormack had the option to extend the

agreement for three six month periods.

The individuals who negotiated this agreement were

Edward Pierson, assistant vice-president of Moore-McCormack,

and Richard Weeks, president of Weeks Stevedoring.

In 1973 Pierson and Richard Weeks also agreed that Weeks

Stevedoring would pay a kickback to Pierson in the amount of

$1,500 per month for the duration of the crane rental agree-

ment.

The crane rental agreement went into effect in 1973.

Moore-McCormack, acting through Pierson, exercised its six

month options effective November, 1975, May of 1976 and

A. 16

November of 1976. Pierson received payments from Richard

Weeks during this three and a half year period with payments in

the approximate amount of $1,500 per month.

Pierson accepted these kickbacks without the knowledge

or consent of Moore-McCormack. During 1976, Pierson had a

conversation with William Montella, who was employed by

Quin Marine Services, and who was found by this court to be a

co-conspirator with reference to the conspiracy charged in

count one.

Pierson told Montella that Weeks Stevedoring (T. 730) was

having difficulty raising cash to pay Pierson and needed a third

party means of collecting from Weeks, such as a false invoice.

Montella told Pierson that Nick Seregos of Jackson Engineering

might be able to prepare a false invoice to Weeks Stevedoring

for repair of the crane and pay Pierson after Jackson Engineer-

ing received payment on the invoice.

During the summer of 1976, Seregos met with Pierson at

Pierson’s office in Brooklyn. During this meeting, Pierson told

Seregos that Moore-McCormack was renting a crane from Weeks

Stevedoring, and that Pierson was receiving money from Weeks

Stevedoring, at least from Richard Weeks of Weeks Stevedoring.

Pierson asked Seregos if Jackson Engineering could submit a

false invoice to Weeks Stevedoring and after the invoice was

paid, give Pierson the money.

Seregos said he would do this but would have to keep

some of the money received from Weeks Stevedoring.

Subsequently, Seregos gave Pierson a detailed invoice for

repair work on the Weeks crane rented by Moore-McCormack.

Pierson gave the invoice to Richard Weeks who told Pierson it

needed correction.

Pierson returned the invoice to Seregos.

On or about October 18, 1976, Seregos gave the (T. 731)

corrected invoice to Pierson who in turn gave it to Richard

Weeks. That would be Government’s Exhibit I in evidence.

Jackson Engineering never did any of the work set forth in

1 in evidence. In early December, 1976, Weeks Stevedoring

issued its check, check bearing No. 8363, Government’s Exhibit

2 in evidence in the amount of $25,795 to Jackson Engineering

in payment of the false invoice.

A. 17

(T. 732) In December of 1976 Seregos called Pierson and

told Pierson that he wanted to meet with him.

Seregos and Pierson arranged to meet at Ponte’s Restau-

rant in Manhattan.

In December of 1976 Seregos gave approximately $18,000

in cash to Pierson in the men’s room at Ponte’s Restaurant in

Manhattan, which money he knew to be the proceeds of a

commercial bribe.

During 1976 Seregos lived and worked in New Jersey, and

traveled to Brooklyn and Manhattan for his meeting with

Pierson, with the intent to further the payment of cash kick-

backs to Pierson.

Now there is an outstanding motion - -

Well, to conclude, then, the Court finds beyond a reason-

able doubt the defendant to be guilty of Counts | and 2.

Sentence will be deferred. No date is set at this time while

we await the Government’s response to Mr. Dearie’s motion.

How long do you wish, Mr. Mescon?

A 16

UNITED STATES OF AMERICA,

Plaintiff-A ppellee,

v,

NICHOLAS SEREGOS,

Defendant-Appellant.

879 Cr, 564

United States District Court,

Southern District of New York,

RAYMOND A, LEVITAS, 180.

Assistant United States Attorneys

Attorneys for United States of America

RAYMOND J, DEARIE, £80,

LESTER M. KIRSHENBAUM, £80.

SURREY & MORSE

465 Maison Avenue

New York, New York 10022

JOHN D. GORDAN, Ill, E80.

LORD DAY & LORD

25 broadway

New York, New York 10004

Attorneys for Defendant

LAWRENCE W. PIERCE, DJ,

A. 19

OPINION

On April 2, 1980, following a five day non-4ury trial,

found guilty of to violate the Federal Travel Act

under 18 U.S.C, § 371 and of violating the federal Travel Act,

18 USL. § 1952. On January 10, 1980, the then attorney

for Seregos, Raymond Dearie, Esq.,' filed a pre-trial motion

requesting, among other things, an Order of this Court pursuant

to Rule 12, Fed. R. Cr. P., and under the inherent and supervisory

powers of this Court, dismissing the indictment with prejudice

upon the grounds that the government's evidence was in part

derived from immunized testimony of Seregos. In the alterna-

tive, defendant sought an Order directing that a hearing be held

and that the government be required to demonstrate to the

satisfaction of this Court that the evidence presented to the

grand jury and at the trial was derived from a source wholly

independent of the immunized testimony of Seregos which was

given in connection with the indictment and trial of Anthony

Scotto (a “Kastigar hearing).

In an Order dated February 22, 1980, the Court denied

the request for pre-trial dismissal of the indictment, but re-

served decision on the Kastigar motion directing that a post-

trial hearing be conducted, if necessary, under Kastigar „.

United States, 406 US. 441 (1972), to determine if the

The defendant was found guilty on Apr 2, 1980, and a

Kastigar hearing was held on July | and 2, 1980. It is initially

noted that under Kastigar „ United States, supra, the burden is

‘Raymond Dearie, Esq., was relieved as counsel in this case via an

Order dated July 10, 1980 upon the Court having been informed that he

had accepted s governmental appointment.

A. 20

has met its burden and therefore denies defendant's motion to

dismiss the indictment under Kastigar v, United States, supra.

In this Opinion the Court also denies defendant's post-

trial motion seeking an Order dismissing the indictment under

the Court's supervisory powers because the government failed

to comply with two Department of Justice policies which

appear in The Department of Justice’s United States Attorney's

Manual, They are: (1) Title 1-11.400 which allegedly requires

prior Justice Department approval of prosecutions of immu-

nized witnesses, and (2) Title 9.2. 100, et seq., which allegedly

requires prior approval of Travel Act prosecutions,

DISCUSSION

1. The Kastigar Hearing

The evidence presented at the hearing establishes that the

government did not rely in any way upon any of Seregos’

immunized testimony in presenting evidence to the grand jury

or at trial, After observing their demeanor on the stand, the

Court finds the two witnesses testifying at the Kastigar hearing,

Assistant United States Attorney (“A. U.S. A.“) Richard Mescon

and Federal Bureau of Investigation (“FBI”) Agent Robert

Cassidy, to be highly credible witnesses. Through their testi-

mony the following was established concerning the prosecution

of Seregos in the instant case,

In September, 1978, A. U.S. A. Mescon was assigned to the

Organized Crime Unit of the United States Attorney's Office,

He was assigned to the prosecution of cases arising out of the

“Unirac” investigation relating to businessmen on the water-

front. In particular, he was assigned to cases involving alleged

payments made to employees of shipping companies (e. g., to

port captains) in connection with obtaining business of those

companies (Tr. at p. 32).? FBI Agent Cassidy was assigned as a

case agent in the Seregos matter in 1979,

The case against Seregos developed after persons in the

United States Attorney's Office, including A. U.S. A. Mescon,

were informed by one Sonny Montella in January, 1979, that

r.“ refers to the transcript of the Kastigar hearing conducted

om July I and 2, 1980,

A. 21

he had made a number of payments to employees of shipping

companies and to others in order to obtain the business of those

companies (Tr. at p. 32). One of the persons he stated he made

a payment to was Edward Pierson. Edward Pierson was

eventually debriefed by the United States Attorney's Office and

he mentioned the name of Seregos as a person that a case could

probably be developed against if the port captains cooperated

(Tr. at p. 34). Mescon’s real evidence against Seregos for

purposes of the indictment against him grew out of the testi-

mony of Richard Weeks, a person whose name was supplied

by Pierson (Tr. at p. 9).

In early 1979 Mescon was aware that Seregos was engaged

in discussions with the United States Attorney's Office concern-

ing a possible guilty plea to certain charges in return for his

testimony as a cooperating witness at the Scotto trial. See Tr.

at p. 9. During the spring of 1979, A. U.S. A. Mescon was

informed by United States Attorney Robert Fiske, Jr., that the

negotiations between the government and Seregos concerning

Seregos’ cooperation at the Scotto trial had broken down, and

that, therefore, Mescon should proceed quickly in obtaining

an indictment against Seregos. A.U.S.A. Mescon perceived the

immunity problems likely to occur, and took steps to insulate

himself from the grand jury proceedings and trial in United

States v. Anthony Scotto, 79 Cr. 32 (S.D.N.Y.) (Stewart, J.).

Also, in light of his awareness of the potential immunity

problems, A. U.S. A. Mescon presented all documents and

testimony to the grand jury returning the original indictment

against Seregos prior to Seregos’ grand jury and trial testimony

in the Scotto case. The documents used in obtaining the Seregos

indictment came from the following sources: (1) a grand jury

subpoena served on Seregos cooperation (sic), Jackson Engincer-

ing Co., in January, 1979;(2) the reports made and filed by Agent

Cassidy in the investigation conducted by the FBI (the 30278);

(3) documents from Richard Weeks, and (4) other documents

which had been supplied by a potential trial witness, James

Canino. In its presentation of evidence to the grand jury as well

as at the trial of Seregos, the government also relied upon the

A. 22

testimony of Richard Weeks and Edward Pierson, and a trans-

cript of a consensually monitored tape recording of a conversa-

tion between Seregos and Montella which was made prior to the

spring of 1979 (see Tr. at p. 51 and government’s Kastigar

hearing exhibits 1 and 3 — the transcript of the Seregos grand

jury proceedings).

The documents received from Weeks were marked before

the grand jury on April 5, 1979; the materials with respect to

Mr. Canino were marked on July 19 and 24, 1979; and the

documents received from Mr. Dearie on behalf of Jackson

Engineering were marked on July 24, 1980 (Tr. at p. 11).

The indictment against Seregos was voted by the grand

jury some time around noon on July 24, 1979 and was filed

immediately thereafter (Tr. at pp. 11 and 59). Seregos appeared

before the grand jury in the Scotto matter on the afternoon of

July 24, 1979, after it had been verified by the AUSA in the

Scotto matter that the indictment against Seregos has been

filed (see Tr. at p. 60).

A. U.S. A. Mescon did not discuss Seregos’ role in the

Scotto case with any member of the United States Attorney’s

Office or any other person except Agent Cassidy who was the

FBI agent assigned to prepare the Seregos case for trial.

A.U.S.A. Mescon did not attend any portions of the Scotto trial

and did not read any newspaper reports of the Scotto trial. He

continued this insulation policy up to the conclusion of the

Seregos trial (Tr. at p. 19), and up until the conviction of

Seregos herein, A.U.S.A. Mescon had no knowledge of the sub-

stance of Seregos’ grand jury or trial testimony in the Scotto

case (Tr. at p. 20), although he may have been aware that it was

of an important nature.

Similarly, Agent Cassidy insulated himself from conversa-

tions and information concerning post-Seregos-indictment testi-

mony of Seregos. He informed his FBI supervisor, the adminis-

trative case agent, and Special Agent Louis Freh and others,

that they were not to make him privy to any post-indictment

information concerning Seregos (Tr. at p. 89). He did not have

any conversations with anyone which revealed the substance

A. 23

of Seregos’ testimony in the Scotto case. He did read a news-

paper summary which indicated that Seregos had appeared as a

witness in the Scotto trial but the article did not give the sub-

stance of the testimony (Tr. at p. 90).

In the continuing effort to insulate themselves from

Seregos’ immunized testimony, Agent Cassidy, in carrying out

A. U.S. A. Mescon’s request for a copy of Seregos’ earlier Water-

front Commission testimony, obtained the Scotto trial copy

directly from the Waterfront Commission and not from the trial

judge in the Scotto case who he was informed had a copy under

seal (Tr. at p. 101). Similarly, when Seregos broached the topic

of payments to Scotto and Anastasia, A.U.S.A. Mescon relied

solely upon pre-indictment information which had been ob-

tained by Agent Cassidy in a debriefing of Sonny Montella on

June 13, 1978 (Tr. at p. 91).

The superseding indictment filed on February 29, 1980

was merely designed to change the government’s legal theory

from one based upon the mail fraud statute to one based upon

the Travel Act, following a Supreme Court decision in United

States v. Perrin, 48 U.S.L.W. 4009 (November 27, 1979), which

changed the law in this Circuit. In obtaining the superseding

indictment, the same evidence was resubmitted to the grand

jury (Tr. at p. 17; see also, government’s Kastigar hearing Ex. 3

— the transcript of the grand jury minutes for the superseding

indictment).

Accordingly, for the reasons stated above, the Court finds

that the government has sustained its burden of proving that the

evidence presented to the grand jury and to the Court at the

time of trial was derived from sources wholly independent of

the defendant’s immunized testimony. The government pre-

sented its evidence to the grand jury prior to Seregos’ testimony

and A.U.S.A. Mescon and Agent Cassidy went out of their way

to successfully avoid learning the “substance” of Seregos’

immunized testimony. The government has demonstrated that

up until the conclusion of the Seregos trial, the prosecutor and

the assigned FBI case agent did not know the “substance” of

Seregos’ testimony before the Scotto grand and petit juries.

Therefore, the motion to dismiss the indictment under United

States v. Kastigar, supra, is denied.

A. 24

2. The alleged violations of Department of Justice policies.

Defendant alleges that the government has not complied

with two Department of Justice policies in obtaining the

present indictment against Seregos, and therefore requests that

the Court use its supervisory powers to dismiss the indictment.

The policy statements at issue here were provided by the

government in its memorandum in opposition to defendant’s

motion. Contrary to defendant’s assertions, these policy state-

ments were not violated.

The first policy statement allegedly violated requires prior

Justice Department approval of prosecution of immunized

witnesses. The government did not violate this policy provision,

first, because in contrast to the policy requirement, the instant

prosecution was initiated before, not after, the immunized

testimony was given; and, secondly, because the crimes charged

against Seregos herein are not related to his Scotto testimony,

again in contrast to the policy provision restriction.

Still further, the government did not violate the Justice

Department policy provision in Title 9-2.100, since, contrary to

defendant’s assertions, the Travel Act apparently is not one of

the statutes included in this policy provision.

Furthermore, even if there was a violation of Department

of Justice policy, neither of the alleged violations constitutes

grounds for dismissal of the indictment. See United States v.

Caceres, 440 U.S. 741 (1979); United States v. Shulman, 466

F.Supp. 293, 297-301 (S.D.N.Y. 1979). The Department of

Justice policies stated in its manual do not create rights, see The

Department of Justice United States Attorney’s Manual, Title

1-100, “Purpose of the Manual”; nor is there case or statutory

law adopting or ratifying the policies at issue here, see

Thompso. v. United States, 100 S.Ct. 512 (1980) (the “Petite”

policy allegedly violated was not only Department of Justice

policy, but was policy promulgated in the wake of two Supreme

Court decisions).

See Petite v. United States, 361 U.S. 529 (1960) and Abbate v.

United States, 359 U.S. 197 (1959).

A. 25

CONCLUSION

Defendant’s motions to dismiss the indictment based upon

an alleged violation of his Fifth Amendment rights under

United States v. Kastigar, supra, and because of alleged viola-

tions of departmental policies are hereby denied. The judgment

of conviction stands, Defendant shall appear for sentencing on

September 10, 1980, at 4:30 in the afternoon.

SO ORDERED.

Dated: New York, New York

August |, 1980

/s/

LAWRENCE W. PIERCE

U.S.D.J.

A. 26

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

V.

NICHOLAS SEREGOS,

Defendant-Appellant.

879 Cr. 564

United States District Court,

Southern District of New Vork.

Filed: August 5, 1980

ORDER

On July 25, 1980, defendant moved for an Order granting

him permission to present, through his new counsel, oral

argument in connection with his motion filed under Kastigar

v. United States, 406 U.S. 441 (1972). In addition, he seeks

to supplement the record of the evidentiary hearing held in

connection with his Kastigar motion.

The Kastigar motion was initially raised in defendant’s

pre-trial motions and arguments in support of the motion were

made in the accompanying memorandum of law. The Kastigar

motion was renewed post-trial, and once again a memorandum

of law accompanied the motion. During the Kastigar hearing

the then attorney for defendant, Raymond Dearie, Esq., was

given an opportunity to orally address the Court in support of

his motion and a schedule was established for post-hearing sub-

missions. On July 10, 1980, the Court by written order with-

drew its request for post-trial submissions; this was done with

the belief that the Court already received sufficient submissions,

presentations of evidence and arguments to rule on the motion.

In its recent motion, defendant has not presented any convinc-

ing reason why the Court should act to the contrary. Therefore,

the motion for oral argument is hereby denied.

A. 27

Deiendant also seeks to supplement the record of the

Kastigar hearing by offering the sealed transcript of his Scotto

trial testimony (while at the same time requesting that the

Court not read it for fear it will prejudice the Court in imposing

sentence) and copies of New York Times articles concerning

his Scotto testimony. The Court finds the connection between

these items and the government’s evidence during the Kastigar

hearing to be at best speculative, thus there is no nexus offered

for the receipt of these items as an aid to the Court in its

determination of the Kastigar motion. Therefore, the Court

also denies defendant’s request to supplement the record.

SO ORDERED.

Dated: New York, New York

August 1, 1980

/s/

LAWRENCE W. PIERCE

U. S. D. J.

A. 28

UNITED STATES OF AMERICA,

Plaintiff-Appellee.

V.

NICHOLAS SEREGOS,

Defendant-A ppellant.

879 Cr. 564

United States District Court,

Southern District of New York.

Filed: September 15. 1980

ENDORSEMENT ORDER 1

The defendant moves (1) to have no sentence imposed,

(2) to vacate this Court’s finding of guilt, and (3) to dismiss the

indictment on the ground that his Fifth Amendment due

process rights were violated because he was not afforded fair

notice that his conduct violated the Travel Act, 18 U.S.C.

§ 1952.

Federal Rule of Criminal Procedure 12(b)(2) requires that

“defenses and objections based on defects in the indictment

or information (other than that it fails to show jurisdiction in

the court or to charge an offense . .)“ must be raised prior to

trial. The defendant does not claim that the Court lacks juris-

diction or that the indictment fails to charge an offense. Rather,

he claims that his due process rights were violated.

Defendant’s failure to raise his objection prior to trial

constitutes a waiver. United States v. Viserto, 596 F.2d 531,

538 (2d Cir. 1979), cert. denied, 100 S.Ct. 80; United States

v. Rodriguez, 556 F.2d 638, 641 (2d Cir. 1977), cert. denied,

434 U.S. 1062. Accordingly, defendant’s motion is denied.

SO ORDERED.

A. 29

Dated: New York, New York

September 11, 1980

a /s/

LAWRENCE W. PIERCE

U. S. D. J.

A. 30

UNITED STATES OF AMERICA,

Plaintiff-Appellee.

V.

NICHOLAS SEREGOS,

Defendant-A ppellant.

879 Cr. 564

United States District Court,

Southern District of New York

Filed: October 17, 1980

ORDER

On April 2, 1980, the defendant, Nicholas Seregos, was

found guilty by this Court on each of two counts charged in an

indictment bearing number S79 Cr. 564. Count One charges

a conspiracy, in violation of 18 U.S.C. § 371, to violate the

Travel Act, 18 U.S.C. § 1952. Count Two charges a substantive

violation of the Travel Act. The predicate state law offense

underlying both counts is commercial bribery in violation of

N.Y. PENAL LAW §§180.03 and 180.08. The first count

charges a conspiracy between May 1973 and May 1977; the

overt acts averring the defendant’s participation refer to dates

ranging from October 18, 1976 to December 1976.

On July 16, 1976, the Second Circuit held that the Travel

Act did not apply to acts of commercial bribery in violation of

the New York Penal Law. United States v. Brecht, 540 F.2d

45 (2d Cir. 1976), cert. denied, 429 U.S. 1123 (1977). On

November 27, 1979, the Supreme Court of the United States

held that the Travel Act did apply to acts of commercial bribery

and in effect overruled the decision of the Second Circuit in

Brecht. Perrin v. United States, 444 U.S. 37 (1979). The super-

seding indictment upon which Seregos was found guilty was

returned following the decision in Perrin.

A.31

By notice of motion filed September 8, 1980, four days

prior to the defendant’s scheduled sentencing, the defendant

moved (1) to have no sentence imposed, (2) to vacate this

Court’s finding of guilt, and (3) to dismiss the indictment on the

ground that his Fifth Amendment due process rights were vio-

lated because he was not afforded fair notice that his conduct

violated the Travel Act.

By endorsement order dated September 11, 1980, the

Court denied the defendant’s motion. After receiving the

defendant’s reply papers, the Court granted the defendant’s

motion for reconsideration made on September 12, 1980.

On September 12, 1980, the defendant was fined $5,000 on

each of the two counts of the indictment. Execution of the

sentence was stayed pending resolution of the present motion.

Federal Rule of Criminal Procedure 12(b)(2) requires that

“defenses and objections based on defects in the indictment

or information (other than [failure] to show jurisdiction in the

court or to charge an offense. . .)” must be raised prior to trial.

Failure to do so constitutes a waiver.

The defendant does not claim that the Court lacks juris-

diction or that the indictment fails to charge an offense. Rather,

he claims that his due process rights were violated.

Although neither Rule 12 nor the Advisory Committee

notes make explicit reference to a due process claim of insuf-

ficient notice, the Court finds that such an objection is of the

type that must be raised prior to trial. Indeed, several motions

were made on defendant’s behalf before trial commenced.

Despite his contentions to the contrary, the defendant knew or

could have known prior to trial that his then alleged illegal

conduct occurred at a time when Brecht was the prevailing law

in this jurisdiction.“ Thus, he could have raised an objection

based on a denial of fair notice prior to trial. His failure to do

' Brecht was the law of this Circuit from June (sic) 16, 1976 until

November 27, 1979. All of the overt acts charged in Count One and the

substantive offense charged in Count Two occurred during this period.

The defendant could certainly have timely moved, on the due process

grounds now asserted, to dismiss the portions of the indictment relating

to events that occurred when Brecht was the rule.

A. 32

© constituted a waiver, Accordingly, the defendant's motion is

denied.

The defendant's sentence shall be executed, within twenty

days of the entry of this Order, pursuant to this Court's

sentencing order dated September 2, | 980.

0 ORDERED.

Dated: New York, New York

October 15, 1980

/s/

LAWRENCE W, PIERCE

U. 8. U. J.

A. 33

UNITED STATES COURT OF APPEALS

FOR THE

SECOND CIRCUIT

Filed: July 28, 1981

A. Daniel Fusaro, Clerk

At a stated Term of the United States Court of Appeals for

the Second Circuit, held at the United States Courthouse in the

City of New York, on the twenty-eichth day of July, one

thousand nine hundred and eighty-one.

Present:

HON. WILFRED FEINBERG, Chief Judge

HON. JAMES L. OAKES, Circuit Judge

HON, EDWARD R NEAHER, District Judge

Circuit Judges,

UNITED STATES OF AMERICA,

Plaintiff-Appellee

.

NICHOLAS SEREGOS,

Defendant-Appellant.

#80-1403

Appeal from the United States District Court for the

Southern District of New York.

This cause came on to be heard on the transcript of record

from the United States District Court for the Southern District

of New York, and was argued by counsel.

ON CONSIDERATION WHEREOF, it is now hereby

ordered, adjudged, and decreed that the judgment of said

District Court be and it hereby is affirmed in accordance with

the opinion of this court.

A. DANIEL FUSARO, Clerk

by Edward J. Guardaro, Deputy Clerk

A. 34

UNITED STATES COURT OF APPEALS

SECOND CIRCUIT

Filed; Sept, 14, 1981

A. Daniel Fusaro, Clerk

At a stated term of the United States Court of Appeals, in

and for the Second Circuit, held at the United States Court

House, in the City of New York, on the 14th day of September,

one thousand nine hundred and eighty-one.

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

* No, 80-1403

NICHOLAS SEREGOS,

Defendant-Appellant.

A petition for rehearing containing a suggestion that the

action be reheard in banc having been filed herein by counsel

for the defendant-appellant, Nicholas Seregos,

Upon consideration by the panel that heard the appeal it

ORDERED that said petition for rehearing is DENIED.

It is further noted that the suggestion for rehearing in banc

has been transmitted to the judges of the court in regular active

and to any other judge on the panel that heard the

and no sich judge has requested that a vote be

taken thereon.

A. DANIEL FUSARO, Clerk

(of

FRANCIS X. GINDHART

Chief Deputy Clerk

A. 35

STATUTES INVOLVED

The Fifth Amendment to the United States Constitution

provides:

No person shall be held to answer for a capital, or other-

wise infamous crime, unless on a presentment or indict-

ment of a Grand Jury, except in cases arising in the land or

naval forces, or in the Militia, when in actual service in

time of War or public danger; nor shall any person be

subject for the same offense to be twice put in jeopardy

of life or limb; nor shall be compelled in any criminal case

to be a witness against himself, nor be deprived of life,

liberty, or property, without due process of law; nor shall

private property be taken for public use, without just

compensation.

The Travel Act, 18 U.S.C. § 1952, provides:

Interstate and foreign travel or transportation in aid of

racketeering enterprises.

(a) Whoever travels in interstate or foreign com-

merce or uses any facility in interstate or foreign com-

merce, including the mail, with intent to

(1) distribute the proceeds of any unlawful

activity; or

(2) commit any crime of violence to further

any unlawful activity; or

(3) otherwise promote, manage, establish,

carry on, or facilitate the promotion, management, estab-

lishment, or carrying on, of any unlawful activity,

and thereafter performs or attempts to perform any of the

acts specified in subparagraphs (1), (2), and (3), shall be

fined not more than $10,000 or imprisoned for not more

than five years, or both.

(b) As used in this section “unlawful activity”

means (1) any business enterprise involving gambling,

liquor on which the Federal excise tax has not been paid,

narcotics, or prostitution offenses in violation of the laws

of the State in which they are committed or of the United

A. 36

States, or (2) extortion, bribery, or arson in violation of

the laws of the State in which committed or of the United

States.

(c) Investigations of violations under this section

involving liquor or narcotics shall be conducted under the

supervision of the Secretary of the Treasury.

18 U.S.C. § 371 provides:

Conspiracy to commit offense or to defraud United States.

If two or more persons conspire either to commit any

offense against the United States, or to defraud the United

States, or any agency thereof in any manner or for any

purpose, and one or more of such persons do any act to

effect the object of the conspiracy, each shall be fined not

more than $10,000 or imprisonment not more than five

years, or both.

If, however, the offense, the commission of which is

the object of the conspiracy, is a misdemeanor only, the

punishment for such conspiracy shall not exceed the max-

imum punishment provided for such misdemeanor.

18 U.S.C. § 6001 provides:

Definitions.

As used in this part —

(1) “agency of the United States” means any execu-

tive department as defined in section 101 of title 5, United

States Code, a military department as defined in section

102 of title 5, United States Code, the Atomic Energy

Commission, the China Trade Act registrar appointed

under 53 Stat. 1432 (15 U.S.C. sec. 143), the Civil Aero-

nautics Board, the Commodity Futures Trading Commis-

sion, the Federal Communications Commission, the

Federal Deposit Insurance Corporation, the Federal

Maritime Commission, the Federal Power Commission, the

Federal Trade Commission, the Interstate Commerce

Commission, the National Labor Relations Board, the

National Transportation Safety Board, the Railroad

Retirement Board, an arbitration board established under

A. 37

48 Stat. 1193 (45 U.S.C. sec. 157), the Securities and

Exchange Commission, the Subversive Activities Control

Board, or a board established under 49 Stat. 31 (15 U.S.C.

sec. 715d);

(2) “other information” includes any book, paper,

document, record, recording, or other material;

(3) “proceeding before an agency of the United

States” means any proceeding before such an agency with

respect to which it is authorized to issue subpoenas and to

take testimony or receive other information from wit-

nesses under oath; and

(4) “court of the United States” means any of the

following courts: the Supreme Court of the United States,

a United States court of appeals, a United States district

court established under chapter 5, title 28, United States

Code, a United States bankruptcy court established under

chapter 6, title 28, United States Code, the District of

Columbia Court of Appeals, the Superior Court of the

District of Columbia, the District Court of Guam, the

District Court of the Virgin Islands, the United States

Court of Claims, the United States Court of Customs and

Patent Appeals, the Tax Court of the United States, the

Court of International Trade, and the Court of Military

Appeals.

18 U.S.C. § 6002 provides:

Immunity generally.

Whenever a witness refuses, on the basis of his privi-

lege against self-incrimination, to testify or provide other

information in a proceeding before or ancillary to —

(1) acourt or grand jury of the United States,

(2) an agency of the United States, or

(3) either House of Congress, a joint committee of

the two Houses, or a committee or a subcommittee of

either House,

A. 38

basis of his privilege against self-incrimination; but no testi-

mony or other information compelled under the order (or

any information directly or indirectly derived from such

testimony or other information) may be used against the

witness in any criminal case, except a prosecution for

perjury, giving a false statement, or otherwise failing to

comply with the order.

18 U.S.C. § 6003 provides:

Court and grand jury proceedings.

(a) In the case of any individual who has been or

may be called to testify or provide other information at

any proceeding before or ancillary to a court of the United

States or a grand jury of the United States, the United

States district court for the judicial district in which the

proceeding is or may be held shall issue, in accordance

with subsection (b) of this section, upon the request of

the United States attorney for such district, an order

requiring such individual to give testimony or provide

other information which he refuses to give or provide on

the basis of his privilege against self-incrimination, such

order to become efiective as provided in section 6002 of

this part.

(b) A United States attorney may, with the approval

of the Attorney General, the Deputy Attorney General, or

any designated Assistant Attorney General, request an

order under subsection (a) of this section when in his

judgment —

(1) the testimony or other information from such

individual may be necessary to the public interest; and

(2) such individual has refused or is likely to refuse

to testify or provide other information on the basis of his

privilege against self-incrimination.

A. 39

N.Y. Penal Law § 180.03 (McKinney's Supp. 1979-80)

provides:

Commercial bribing in the first degree.

A person is guilty of commercial bribing in the first

degree when he confers, or offers or agrees to confer, any

benefit upon any employee, agent or fiduciary without the

consent of the latter’s employer or principal, with intent

to influence his conduct in relation to his employer's or

principal’s affairs, and when the value of the benefit con-

ferred or offered or agreed to be conferred exceeds one

thousand dollars.

Commercial bribing in the first degree is a class A

misdemeanor.

N.Y. Penal Law § 180.08 (McKinney’s Supp. 1979-80)

provides:

Commercial bribe receiving in the first degree.

An employee, agent or fiduciary is guilty of commer-

cial bribe receiving in the first degree when, without the

consent of his employer or principal, he solicits, accepts or

agrees to accept any benefit from another person upon an

agreement or understanding that such benefit will influ-

ence his conduct in relation to his employer's or principal’s

affairs, and when the value of the benefit solicited,

accepted or agreed to be accepted exceeds one thousand

dollars.

Commercial bribe receiving in the first degree is a

class A misdemeanor.

“lice Supreme Court, U.S. |

I

JAN 29 1990

No. 81-895

— Evas.

CLERK

In the Supreme Court of the United States

OCTOBER TERM, 1981

NICHOLAS SEREGOS, PETITIONER

V.

UNITED STATES OF AMERICA

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

BRIEF FOR THE UNITED STATES IN OPPOSITION

REx E. LEE

Solicitor General

D. LOWELL JENSEN

Assistant Attorney General

FRANK J. MARINE

Attorney

Department of Justice

Washington, D.C. 20530

(202) 633-2217

—— — ſ — —

QUESTIONS PRESENTED

1. Whether the indictment should be dismissed on

the ground that improper use was made of petition-

er’s immunized testimony.

2. Whether petitioner’s conviction for a violation

of the Travel Act, 18 U.S.C. 1952, based on conduct

that occurred before this Court’s decision in Perrin v.

United States, 444 U.S. 37 (1979), violates the Due

Process Clause.

(1)

TABLE OF CONTENTS

Page

Opinions below 1

Jurisdiction 1

Statement 2

1111111 9

Conclusion 22

TABLE OF AUTHORITIES

Cases:

Bouie v. City of Columbia, 378 U.S. 347 .................. 19, 20

Goldberg v. United States, 472 F.2d 518 .................. 6

James v. United States, 366 U.S. 218 ...................... 17

Kastigar v. United States, 406 U.S. 441 4, 5, 9, 10, 12

Lego v. Twomey, 404 U.S, 477 10

Lewis v. United States, 445 U.S. 55 5 18

Marks v. United States, 480 U.S. 188 19, 20

Miller v. California, 413 U.S. 15 19

Perrin v. United States, 444 U.S. 37 16, 19

United States v. Apfelbaum, 445 U.S. 1155 11, 12

United States v. Brecht, 540 F. 2d 45, cert. denied,

429 U.S. 1123 16, 17, 20, 21

United States v. Feola, 420 U.S. 671 17

United States v. Goodheim, 651 F.2d 1294, rehear-

e 18

United States v. Harriss, 347 U.S. 61222 15

United States v. McDaniel, 482 F.2d 30 11

United States v. Mercado, 478 F.2d 118 17, 20

United States v. Perrin, 580 F.2d 730, aff’d, 444

US, 37 17, 21

United States v. Polizzi, 498 F.2d 570 16-17

United States v. Pomponio, 511 F.2d 953, cert. de-

A ce a een 20

Weatherford v. Bursey, 429 U.S. 5453. 11

Constitution and statute:

United States Constitution:

Article I, Section 10 14

Fifth Amendment, Due Process Clause . 14-15, 16

()

IV

Constitution and statute—Continued Page

Travel Act, 18 U.S.C. 1952......2, 9, 14, 15, 16, 18, 19, 20, 21

18 U.S.C, 2 2

18 U.S.C. 371 2

18 U.S.C. 3237 21

N.Y. Penal Law (McKinney’s Supp. 1979-1980):

§ 180.03 14, 15

§ 180.08 — 14,15

Miscellaneous:

J. Hall, General Principles of Criminal Law (2d

ed. 1960) 19

In the Supreme Court of the United States

OCTOBER TERM, 1981

No. 81-895

NICHOLAS SEREGOS, PETITIONER

V.

UNITED STATES OF AMERICA

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

BRIEF FOR THE UNITED STATES IN OPPOSITION

OPINIONS BELOW

The opinion of the court of appeals (Pet. App. Al-

Al0) is reported at 655 F.2d 33. The opinion of the

district court (Pet. App. A18-A25) is unreported.

JURISDICTION

The judgment of the court of appeals was entered

on July 28, 1981. A petition for rehearing was de-

nied on September 14, 1981. The petition for a writ

of certiorari was filed on November 12, 1981. The

jurisdiction of this Court is invoked under 28 U.S.C.

1254(1).

(1)

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itial indictment was filed before petitioner gave any

immunized testimony; he then scheduled a post-trial

Kastigar hearing to determine whether the govern-

ment’s trial evidence was tainted (Pet. App. A11-

Al2).

After petitioner was convicted, Richard Mescon, the

Assistant United States Attorney who conducted the

grand jury investigation and petitioner's trial, and

FBI Agent Robert Cassidy, the case agent on peti-

tioner’s case, testified for the government at the Kas-

tigar hearing. Mescon testified that the investigation

developed both Pierson and Weeks as witnesses; they

guilty to criminal informations on April 5, 1979,

May 10, 1979, respectively (H. Tr. 8-9). Peti-

through his counsel, was simultaneously en-

in periodic negotiations with United States At-

and Assistant United States At-

iis

5

3

13

f

:

:

f

f

i

broke down, Fiske instructed Mescon to proceed

th the indictment of petitioner (H. Tr. 10). The

indictment was returned on July 24, 1979, and peti-

tioner first gave immunized testimony later that day

— (Pet. App.

Mescon testifled that he took special precautions to

protect the integrity of petitioner’s prosecution from

4

the indictment (H. Tr. 10-12; H. GX 1).“ He did not

read petitioner’s grand jury or trial testimony, nor

did he discuss petitioner’s involvement in the case with

any person other than Agent Cassidy. He did not at-

tend any portions of the Scotto trial at which peti-

tioner testified, and he did not read any newspaper

accounts of that trial. Up to the conclusion of peti-

tioner’s trial in April 1980, he had no knowledge of

the substance of petitioner’s testimony before the

grand jury or at the Scotto trial (H. Tr. 17-20).

Mescon further testified that, in addition to the tes-

timony of Pierson and Weeks, the government’s direct

case at trial consisted exclusively of documents sub-

poenaed from Weeks Stevedoring and Jackson Engi-

neering prior to the indictment of petitioner (H. Tr.

20-21). Mescon also explained the independent sources

of topics and documents he used during the cross-

examination of petitioner. Information concerning

payoffs petitioner made to Scotto and Anastasio was

provided Mescon by Agent Cassidy in the form of Cas-

sidy’s notes of his debriefing of Montella in June

1978, a tape recording of a consensually monitored

conversation between Montella and petitioner in Au-

gust 1978, and certain “302 reports” by FBI agents

made in 1977 (H. Tr. 26-27). Mescon explained that

he also learned from Agent Cassidy, based on certain

conversations overheard before petitioner gave his im-

* The superseding indictment on which petitioner went to

trial was voted by a different grand jury but was based on

the same evidence that had been presented to the first grand

jury (H. Tr. 16-17; H. GX 8).

This procedure of presenting all of the available evidence

to the grand jury served the purpose of certifying the gov-

ernment’s evidence prior to immunizing the defendant. See

— v. United States, 472 F.2d 513, 516 n.5 (2d Cir.

7

1

munized testimony, that petitioner had testified before

the Waterfront Commission in 1976. The actual

transcript of petitioner’s testimony obtained from the

Waterfront Commission supplied the basis for the

cross-examination on this subject (H. Tr. 21-23).

Mescon described a meeting in early Murch 1980

that he had with Fiske, Levine, and Raymond Dearie,

petitioner’s counsel, during which Dearie requested

that the government drop the indictment against peti-

tioner or offer him an opportunity to plead guilty to

a misdemeanor charge, which had been offered to him

during the earlier negotiations before the Scotto trial.

After the meeting, Mescon and Fiske decided to pro-

ceed with trial and not renew the misdemeanor offer

(H. Tr. 70-72). Mescon testified that he did “not pre-

cisely” recall telling Dearie the reasons for the deci-

sion, but that “[t]he basic reason was that having

made an offer for the misdemeanor disposition at one

time, and having had that offer refused at the time

his share” (H. Tr. 73).

With respect to his cross-examination of petitioner

concerning his payments to employees of Hellenic

Lines, Mescon stated that his “first knowledge of that

information was when [petitioner] told me during his

cross-examination” (H. Tr. 79). He also stated that,

might be a fruitful area (H. Tr. 80, 118). Mescon

also testified that the decision not to call Montella as

a rebuttal witness was his alone (H. Tr. 130), al-

though he did consult with Fiske, Levine, and others

before making the decision, which turned on one pri-

mary consideration—whether problems could arise in

the event there were inconsistencies between Mon-

tella’s testimony in this case and his testimony in the

related Scotto and Clemente trials (H. Tr. 125-130).

FBI Agent Robert Cassidy testified that he had

worked on the waterfront investigation for four and

a half years. Cassidy testified that when petitioner

was indicted in July 1979, both Mescon and Fiske in-

structed him to insulate himself from conversations

pertaining to any post-indictment testimony of peti-

tioner. To that end, Cassidy spoke with his super-

visor and other agents working on the investigation,

telling them not to reveal to him any information re-

lating to petitioner’s immunized testimony (H. Tr.

89). Prior to the verdict in petitioner’s case, Cassidy

never read petitioner’s grand jury or trial testimony,

never spoke to any FBI Agent, Assistant U.S. Attor-

ney, or any other person concerning the substance of

that testimony, and, except for a single summary arti-

cle, which stated only that petitioner was a witness

at the Scotto trial, never read anything in the news-

paper about that testimony (H. Tr. 89-90). Cassidy

further testified that he learned of petitioner’s pay-

ments to Anastasia on June 13, 1978, during his de-

briefing of Montella (H. Tr. 91) and that he learned

that petitioner had testified before the Waterfront

Commission from the August 1978 taped conversa-

tions between Montella and petitioner (H. Tr. 96).

Petitioner presented no witnesses at the hearing.

It was stipulated that, if called as a witness, Dearie

would testify that one of the reasons given at the

meeting with Fiske, Levine and Mescon for declining

to offer a misdemeanor disposition was “the informa-

tion that [petitioner] had revealed while under his

grant of immunity” (H. Tr. 139). Dearie also would

have stated that Mescon later identified this as the

principal one of many reasons for declining to offer

an opportunity to plead guilty to a misdemeanor

(ibid.). Mescon, however, testified that he did not

recall making this statement; moreover, while he did

not specifically recall not making the statement, the

basic reason for the decision was that petitioner had

failed to perform his part of the bargain that had

been the predicate for the original misdemeanor offer

(H. Tr. 73-74).

3. On August 1, 1980, the district court issued an

opinion concluding that “the government has sus-

tained its burden of proving that the evidence pre-

sented to the grand jury and to the Court at the time

of trial was derived from sources wholly independent

of [petitioner’s] immunized testimony” (Pet. App.

A23). Finding Mescon and Cassidy to be “highly

credible witnesses” (id. at A20), the court rejected

petitioner’s claim of taint and denied his motion to

dismiss the indictment. On appeal, the court of p-

peals affirmed, stating that “[f]rom our independent

review of [the] record we see no reason to question

Judge Pierce’s findings” (id. at A10). The court also

rejected petitioner’s contention that he did not have

fair notice that his conduct violated the Travel Act

(id. at A5-A7).

ARGUMENT

1. Petitioner contends (Pet. 10-13) that the gov-

ernment improperly used his immunized grand jury

testimony, in violation of the principles enunciated in

Kastigar v. United States, 406 U.S. 441 (1972).

Specifically, while petitioner does not dispute that

the evidence introduced at trial was obtained with-

out use of the immunized testimony, he contends

(Pet. 11-12) that the United States Attorney refused

10

to agree to a more lenient disposition of the charges

because of admissions made in petitioner’s immunized

testimony, that the trial prosecutor planned trial

strategy in consultation with other government at-

torneys who had been exposed to petitioner’s im-

munized testimony, and that the idea of cross-

examining petitioner at trial about two subjects—

his payments to Hellenic Lines employees and his

false testimony before the Waterfront Commission—

was suggested by his immunized testimony. These

contentions do not merit review by this Court.

The government has the burden of proving by a

preponderance of the evidence (see Lego v. Twomey,

404 U.S. 477, 487-489 (1972)) that “the evidence it

proposes to use is derived from a legitimate source

wholly independent of the compelled [immunized]

testimony.” Kastigar v. United States, supra, 406

U.S. at 460. Based on the testimony offered by the

government’s witnesses at the post-trial Kastigar

hearing, the district court found that the government

met this burden. The district court’s findings here

that there was no improper use of petitioner’s im-

munized testimony are supported by the record, and

its ruling was affirmed by the court of appeals. Fur-

ther review of this factbound issue is therefore un-

warranted.

Petitioner’s first claim of taint rests upon the

participation of Fiske and Levine in the denial of

petitioner’s eve of trial request for a misdemeanor

disposition and the statement of petitioner’s trial

attorney that he had been told that the request was

denied because of petitioner’s immunized testimony.

However, Mescon testified that he did not recall that

this was the basis for the denial of petitioner’s re-

quest. Rather, Mescon testified that “the basic rea-

11

son” for not agreeing to a misdemeanor disposition

was that petitioner had rejected a similar proposal

previously, and the prosecutors did not consider it

appropriate to let petitioner “have the benefit of the

bargain without having done his share” (H. Tr. 73).

While the district court made no specific finding on

this point, it found that Mescon was a “highly credi-

ble” witness (Pet. App. A20), and thus the record

supports the conclusion that the decision to deny

petitioner’s request was not tainted by information

gleaned from his immunized testimony.

In any event, petitioner would not be entitled to

relief even if his immunized testimony had somehow

influenced the decision not to permit petitioner to

plead guilty to misdemeanor charges. Such reference

to immunized testimony does not involve the im-

permissible use of immunized testimony or any of

its fruits against a defendant. A defendant has

no right to plead guilty to reduced charges or to

require the government to engage in plea bargaining.

Weatherford v. Bursey, 429 U.S. 545, 561 (1977).

The fact that the government did not offer petitioner

a benefit to which he had no entitlement would not

be an impermissible “use” of his immunized testi-

mony against him. See United States v. Apfelbaum,

445 U.S. 115, 124-125 (1980).*

* Petitioner’s reliance (Pet. 10-12) upon dictum to the con-

trary in United States v. McDaniel, 482 F.2d 305 (8th Cir.

1973), is misplaced. In McDaniel, the federal prosecutor, un-

aware that the testimony was immunized, read the three vol-

umes of the defendant's state grand jury testimony prior to

presenting the case against the defendant to a federal grand

jury. The cowrt held that, under these circumstances, it could

not conclude that the prosecutor had not made some use of the

immunized testimony. In listing possible uses, the court noted

that a refusal to plea bargain was one area in which im-

In addition, petitioner’s trial counsel knew that

Fiske and Levine had prosecuted the Scotto case and

therefore that they were familiar with petitioner’s

immunized testimony. Yet, on his own initiative,

petitioner requested a meeting with Fiske on the eve

of trial to take his “last crack at the U.S. Attor-

ney’s Office“ (see H. Tr. 71-72, 137). Thus, if

the decision not to offer petitioner an opportunity

ment’s decision to request a postponement of peti-

tioner’s trial until after the trial of the Scotto case.

Mescon, who discussed the matter with Fiske and

Levine only after his decision had been made (H. Tr.

132). In any event, petitioner does not suggest how

—— — —

decision at the close of the trial not to call Montella

as a rebuttal witness to contradict parts of peti-

tioner’s testimony. While Mescon testified that that

its dictum does not accord with this Court’s later explanation

in Apfelbaum, supra, of the scope of use immunity.

13

decision was his alone (H. Tr. 130), he did consult

with Fiske, Levine, and others who may have been

familiar with the immunized testimony. But the

record makes clear that the only consideration in

deciding whether to call Montella was the possibility

that, under cross-examination, he would testify in-

consistently with his testimony at other trials, thus

opening the door to possible requests for post-trial

relief in those other prosecutions (H. Tr. 125-130).

Thus, there is no basis for speculating that peti-

tioner’s immunized testimony, which was totally ir-

relevant to this consideration, had any bearing on the

decision not to call Montella. Moreover, petitioner

suffered no harm from the government’s decision not

to call Montella, who had already testified in other

trials contrary to crucial elements of petitioner’s testi-

mony (see Tr. 22). Indeed, petitioner himself was

free to call Montella if he believed his testimony would

be of benefit (see Tr. 724).

Petitioner also contends that the government

failed to establish a basis independent of the im-

munized testimony for two separate topics of cross-

examination. This claim is belied by the record.

With respect to the question concerning payments to

Hellenic Lines, Mescon testified at the hearing that

he did not learn of these payments until he heard

petitioner’s admissions during cross-examination (H.

Tr. 79).“ Indeed, because neither Mescon nor Cassidy

‘The record shows that the natural development of the

cross-examination led directly to the challenged inquiry. Thus,

petitioner first testified that from 1974-1978, he generated

$12,000 in cash per month (Tr. 535-536). He was then asked

about his payments to Anastasio, which petitioner freely ad-

mitted (Tr. 545). Petitioner was then asked if he made pay-

ments for any other company’s business and answered that

there was one other company. Then the prosecutor asked if

14

was aware of the substance of petitioner’s immunized

testimony (H. Tr. 17-20, 89-90), there is no ground

for conjecturing that that testimony was the source

of this question. Similarly, both Cassidy and Mescon

testified that Cassidy learned of the Waterfront Com-

mission testimony from tape recordings of petitioner

(H. Tr. 21-23, 96). In sum, there is no basis for

disturbing the findings of the two courts below that

the prosecution did not use petitioner’s immunized

testimony or any evidence derived from it.

2. Petitioner also contends (Pet. 13-17) that his

conviction violates the Due Process Clause because

he did not receive fair notice that his participation

in an illegal commercial bribery scheme violated the

Travel Act, 18 U.S.C. 1952. This contention is with-

out merit.

Clearly, the constitutional prohibition against ex

post facto laws, Article I, Section 10, has no applica-

tion here. The Travel Act was enacted in 1961 and

thus was in force for many years before petitioner

committed the crimes for which he was convicted.

Similarly, the underlying state statute that petitioner

violated, N.Y. Penal Law §§ 180.03, 180.08 (McKin-

ney’s Supp. 1979-1980), and its essentially identical

predecessor, had prohibited the conduct at issue for

many years before petitioner committed the acts that

gave rise to this indictment. The Due Process

this remaining company was Hellenic Lines, a logical question

in light of that company’s status as Jackson’s primary cus-

tomer (Tr. 554-555).

*The present version of N.Y. Penal Law §§ 180.03 and

180.08 became effective on September 1, 1976. But the only

changes in the prior law effected by the 1976 amendment were

subdivision of the crime into different degrees depending upon

the amount of money in question, and enhancement of the

penalty for the greater offense.

15

Clause, however, also requires that a criminal statute

afford fair notice of what conduct is deemed criminal

because “no man shall be held criminally responsible

for conduct which he could not reasonably under-

stand to be proscribed.” United States v. Harriss,

347 U.S. 612, 617 (1954). Here, however, there

can be no doubt that petitioner had fair notice that

his conduct was proscribed.

Petitioner does not dispute that the state commer-

cial bribery statute unambiguously proscribes his

conduct.’ Thus, petitioner clearly had fair notice

that his conduct was criminal, in violation of the

statute listed in the indictment as the predicaie for

the Travel Act offense. By the same token, the

Travel Act, by its express terms, plainly covers com-

The indictment listed two New York statutes as predicate

state offenses. N.Y. Penal Law § 180.03 (McKinney’s Supp.

1979-1980) provides:

A person is guilty of commercial bribing in the first

degree when he confers, or offers or agrees to confer,

any benefit upon any employee, agent or fiduciary with-

out the consent of the latter’s employer or principal, with

intent to influence his conduct in relation to his em-

ployer’s or principal’s affairs, and when the value of the

benefit conferred or offered or agreed to be conferred

exceeds one thousand dollars.

N.Y. Penal Law § 180.08 (McKinney’s Supp. 1979-1980)

provides :

An employee, agent or fiduciary is guilty of commer-

cial bribe receiving in the first degree when, without the

consent of his employer or principal, he solicits, accepts

or agrees to accept any benefit from another person

upon an agreement or understanding that such benefit

will influence his conduct in relation to his employer’s

or principal’s affairs, and when the value of the benefit

solicited, accepted or agreed to be accepted exceeds one

thousand dollars.

F

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* The Travel Act, 18 UBL, 1

17

oe 1974); United States v. Mercado, 478

1111 (2d Cir. 1973). See also James v.

82

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U.S. 213, 241 (1961) (opinion of

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As petitioner notes (Pet. 10, 15), in United States

v. Goodheim, 651 F.2d 1294, rehearing denied,

664 F.2d 754 (1981), the Ninth Circuit has

recently taken a position at odds with the

the predicate conviction, because

Similarly, petitioner’s reliance (Pet. 14-15) on

Marks v. United States, 430 U.S. 188 (1977), and

Bouie v. City of Columbia, 378 U.S. 347 (1964), is

In Bowie, a case involving the judicial

expansion of 4 state trespass statute to cover a civil

rights demonstrator’s refusal to leave a restaurant,

ee een eee oe Ree

and

indefensible by reference to the law which had been

expressed prior to the conduct in issue,’ it must not be

given retroactive effect.” Id. at 354, quoting J. Hall,

General Principles of Criminal Law 61 (2d ed. 1960)

(emphasis added). In Marks, the Court applied Bouie

in holding that its decision in Miller v. California,

413 U.S. 15 (1973), which expanded criminal lia-

commercial bribery was neither unforeseeable nor an

expansion of the Travel Act’s scope. As a unani-

mous Court stated in Perrin v. United States, supra,

444 U.S. at 45, when the Travel Act was enacted

the defendant is charged. Since Goodheim's conduct appar-

ently was criminal only under the federal firearm laws, the

court of appeals had no occasion to consider or decide the

point, Thus it remains unclear how the Ninth Circuit would

rule on a case such as petitioner's, and there is no inter-

“the common understanding and meaning of ‘bribery’

had extended beyond its early common-law defini-

tions” and encompassed commercial bribery. More-

over, even prior to the Brecht decision, the Fourth

Circuit had held that the Travel Act covered com-

mercial bribery as defined by New York’s commercial

bribery statute. United States v. Pomponio, 511 F.2d

953, cert. denied, 423 U.S. 874 (1975). There-

fore, it was readily foreseeable at the time of

petitioner’s criminal conduct that his conduct violated

the Travel Act. See United States v. Mercado, supra,

478 F.2d at 1111. In contrast to Marks, where the

conduct proscribed by the statute could be understood

only by reference to this Court’s constitutional deci-

sions regarding “obscenity” (see 430 U.S. at 195),

within it by an act of judicial construction” (378

U.S. at 352), petitioner’s conduct here violated the

plain language of a specific criminai statute.

—— 2 —— —

cate state commercial bribery offense is the require-

ment of interstate travel. While it was, of course,

essential for the government to prove such travel,

the statute does not require that petitioner have any

particular mental state concerning that travel or any

knowledge that his crime became a federal one be-

state travel, he did have notice of the criminality of

the actions that underlay his conviction.”

Finally, whatever the theoretical merits of peti-

tioner’s contentions, his case is fatally flawed in an-

While this offense was completed in New York, which

is within the Second Circuit, it was begun in New

Jersey, which is within the Third Circuit. As is

clear from 18 U.S.C. 3237, petitioner could as read-

erroneously

Thus, if it was fair for this Court to uphold Perrin’s

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CONCLUSION

The petition for a writ of certiorari should be

denied.

Respectfully submitted.

JANUARY 1982

® ©. ©. covennecer eee orrice, 1902 n n

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Sele

No. 81-895

IN THE

Supreme Court of the United States

OCTOBER TERM, 1981

—

NICHOLAS SEREGOS,

Petitioner,

UNITED STATES OF AMERICA,

Respondent.

ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES

COURT OF APPEALS FOR THE SECOND CIRCUIT

PETITIONER’S REPLY BRIEF

JOHN D. GORDAN, ID!

LAURIE E. FOSTER

25 Broadway

New York, New York 10004

(212) 344-8480

Attorneys for Nicholas Seregos

TABLE OF CASES

PAGE

Bouie v. City of Columbia, 378 U.S. 347 (1964) 2, 3. 4

Calder v. Bull, 3 Dall. 386 (176) 4

Fletcher v. Peck, 6 Cranch 87 (180) . 4

James v. United States, 366 U.S. 213 (961) 2

Kastigar v. United States, 406 U.S. 441 (%)) 5, 6,7

Love v. Fitzharris, 311 F.Supp. 702 (N. D. Cal. ,

aff'd, 460 F.2d 382 (9h Cir. 1972), vacated as moot,

—— — — 4

Marino v. Bowers, 657 F.2d 1363 (3d Cir. 1981) (en

r os nc caneseneceadbadiiiete 2

Marks v. United States, 430 U.S. 188 (% 2

New Jersey v. Portash, 440 U.S. 450 (1979) .......... 7

Perrin v. United States, 444 U.S. 37 (1979) .......... 2. 3. 5

United States v. Apfelbaum, 445 U.S. 115 (1980)...... 6

United States v. Brecht, 340 F.2d 45 (2d Cir. 1976), cert

denied, 429 U.S. 1123 %% 2. 3. 3

United States v. Carvelli, 340 F.Supp. 1295 (E. D. N. V).

aff'd, 464 F.2d 1129 (2d Cir.), cert. denied, 409 U.S.

. 4

United States v. Goodheim, 651 F.2d 1294, reh. denied,

664 F.2d 754 (9th Cir. 19886110 . 1, 2. 3

United States v. McDaniel, 482 F.2d 305 (8th Cir. 1973) 7

United States v Mercado, 478 F. zd 1108 (2d Cir. 1973). 2

United States v. Michael, 456 F.Supp. 337 (D. N. J.

1978), aff'd without opinion, 605 F.2d 119% (3d Cir.

1979), cert. denied, 444 U.S. 1032 (1980)........... 5

iii

PAGE

United States v. Polizzi, 493 F.2d 570 (3d Cir. 1974) ... 2

Woxberg v. United States, 329 F.2d 284 (9th Cir.), cert.

denied, 379 U.S. 823 (1964 „pͤ cece cceeeeeees 4

IN THE

Supreme Court of the United States

OCTOBER TERM, 1981

No. 81-895

>

NICHOLAS SEREGOS,

Petitioner,

—

UNITED STATES OF AMERICA,

Respondent.

ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES

COURT OF APPEALS FOR THE SECOND CIRCUIT

>

PETITIONER’S REPLY BRIEF

1. The Government’s argument in favor of the retroactive

application of an expanded construction of the Travel Act (18

U.S.C. § 1952) to conduct previously immune under it rests, as

the Government concedes, on an analysis which the Court of

Appeals for the Ninth Circuit has twice rejected on the grounds

that it “would not only violate constitutional principles, but

would undermine the integrity of our federal appellate sys-

tem.” United States v. Goodheim, 651 F.2d 1294, rehearing

denied, 664 F.2d 754 (1981). Despite the Government’s failure

to seek rehearing en banc in Goodheim, a member of the Court

considered the retroactivity issue so difficult and important

that he requested that the Court be polled and dissented from

2

its determination not to consider the case en banc. Id. at 756.

In the face of its loss in the Ninth Circuit, and grudgingly

conceding at least a burgeoning conflict between Goodheim

and this case (Brief for the United States at 18 & n.13), the

Government nevertheless announces that it will not seek cer-

tiorari in Goodheim and urges the Court to avoid an issue of

obvious current importance both to the judicial process and to

the administration of criminal justice.*

Relying on the concurring and dissenting opinions of Jus-

tices Harlan and Clark in James v. United States, 366 U.S. 213

(1961), and two lower court decisions** which attempt to

derive a rule from the five different opinions announced in

James, the Government claims that, to bar retroactive applica-

tion of Perrin v. United States, 444 U.S. 37 (1979), in this case,

the petitioner had to show that he actually relied in good faith

on the contrary decision in United States v. Brecht, 540 F.2d 45

(2d Cir. 1976), cert. denied, 429 U.S. 1123 (1977). This argu-

ment, emphatically rejected in Goodheim on rehearing, 664

F.2d 754, and not even raised in the Second Circuit in this case,

has no merit. Whatever the vitality at the time of the ill-defined

requirement of actual reliance conjured by Polizzi and Mer

cado from the conflicting opinions in James, it does not

survive the Court’s subsequent elaboration of ithe Due Process

protection against retroactive application of expansive judicial

interpretations of criminal statutes in Bouie v. City of Colum-

bia, 378 U.S. 347 (1964), and Marks v. United States, 430 U.S.

188 (1977).

In Marks, the most recent treatment of this issue, there was

no claim that the petitioner had relied on the Court’s earlier

mme retroactivity issue presented by this case and Goodheim has

striking parallels in other areas of the law. E.g., Marino v. Lowers, 657

F.2d 1363 (3d Cir. 1981) (en banc). We do not suggest, of course, that

the resolution of that issue in those contexts turns on the same

constitutional considerations presented in a federal criminal prose-

cution.

United States v. Polizzi, 493 F.2d 570 (3d Cu. 1974); United States v.

Mercado, 478 F.2d 1108 (2d Cir. 1973).

3

restrictive interpretation of the federal obscenity statute, nor

any requirement announced by a unanimous Court that more

need be shown to trigger the protection of the Due Process

Clause than that the Court's broader re- definition of obscenity

had expanded the scope of the statute to reach conduct to

which it had not previously applied. 430 U.S. at 194, 196.

Similarly, no showing of reliance was required in Boule.

The second principal defect in the Government's argument is

its claim that the prohibitions of the New York commercial

bribery statute authorize the retroactive application of the

expansive reading of the Travel Act in Perrin to petitioner's

conduct, which occurred when the Second Circuit's contrary

decision in Brecht stated the applicable law.

First, in an effort to distinguish Goodheim, the Government

claims that “Goodheim’s conduct apparently was criminal only

under the federal firearms laws. . .” (Brief for United States at

18 n.13) and that Goodheim should be read narrowly to apply

only where the retroactive application of an expansive interpre-

tation of a criminal statute criminalizes conduct that was

otherwise innocent. However, the distinction fails in light of

the fact that Goodheim was also charged and convicted in the

same counts for using a false name as well as for concealing his

prior felony conviction when purchasing weapons, and that the

evidence at trial showed that in connection with at least one of

his purchases he had filled out a state form as well as the

federal forms which formed the basis for the charges.*

More fundamentally, the Due Process violation inherent in

the retroactive application of a new and broader reading of a

federal criminal statute to conduct to which it had been held

inapplicable cannot be cured by reference to a state law which

forbids acts of a different character and punishes them less

severely.** First, for ex post facto purposes, interstate travel

* — Brief for the United States in United States v. Goode, Okt. No.

80-1408 (9th Cir.), filed January 16, 1981, at 2-4,

** The Government's contention that the expansive view of the Travel

Act taken in Perrin was “foreseeable” is refuted by the Petition (at 16).

4

with unlawful purpose in violation of federa! law is a different

crime from commercial bribery in violation of local law.

Woxberg v. United States, 329 F.2d 284, 293 (9th Cir.), cert.

denied, 379 U.S. 823 (1964); United States v. Carvelli, 340

F.Supp. 1295, 1302 (E. D. N. V), aff'd, 464 F.2d 129 (2d Cir.),

cert. denied, 409 U.S. 1023 (1972).* Second, the Government's

effort to treat the offenses as identical also ignores nearly two

hundred yeurs of settled precedent that the Ex Post Facto

protections of the Constitution forbid not only the retrospec-

tive criminalization of conduct not previously prohibited but

also the infliction of greater punishment than provided by law

for an existing offense at the time of its commission. Calder v.

Bull, 3 Dall. 386, 390 (1798); Fletcher v. Peck, 6 Cranch 87,

138 (1810) (“An ex post facto law is one which renders an act

punishable in a manner in which it was not punishable when

committed.”) The incorporation of the protections of the Ex

Post Facto Clause into the Due Process Clause by Boule

includes the concept of enhanced puni.ument. Love v.

Fitzharris, 311 F.Supp. 702, 703 (N.D. Cal. 1970), /d, 460

F.2d 382 (9th Cir. 1972), vacated as moot, 409 U.S. 1100

(1973):

This Court sees no reason to say that the logical import of

Bouie was not to extend the ex post facto principle in all

its ramifications to any change in the law, whether

wrought by legislative amendment, judicial construction,

or administrative reinterpretation, which is applied re-

troactively so as to deprive a criminal defendant of fair

notice not only of the criminal nature of his act but also

of the punishment to which he will be subject upon

conviction.

Even accepting arguendo that the Travel Act ana the N.Y.

commercial bribery statute prohibit the same offense, Bouie

bars a prosecution under a statute with penalties greater than

° Indeed, under Section 1952(a), the state law predicate crime need not

even be completed for liability to attach under the Ty avel Act.

5

those provided by existing law at the time of the crime. Not

only were such penalties prescribed by the Travel Act, which is

a felony statute, the punishment exacted here greatly exceeded

the maximum penalty under the N.Y. commercial bribery

statute, which is a misdeameanor.

The only further argument requiring comment is the sugges-

tion that the Due Process contention is “fatally flawed” by the

fact that the petitioner could have been prosecuted in the Third

Circuit, which had not decided the issue posed by Brecht and

Perrin, (Brief for United States at 21). The short answer to this

is that, for the Government's purposes then, the petitioner was

not prosecuted in the Third Circuit, and its current effort to

avoid constitutional infirmity by arguing what might have

been, but was not, is no more valid than its principal assertion

that the existence of a state criminal law permits an ex post

facto prosecution under federal law for a different crime.

Apart from this, such authority as did exist at the time in the

District of New Jersey, from which petitioner traveled to New

York, suggests Brecht would have been applied there as well.

United States v. Michael, 456 F.Supp. 335 (D. N. J. 1978), aff'd

without opinion, 605 F.2d 1198 (3d Cir. 1979), cert. denied, 444

U.S. 1032 (1980). Finally, no authority is shown for the

proposition that a conviction for violation of the Travel Act

may rest on travel between two states, in one of which such

travel could not violate the statute; no unlawful travel between

New Jersey and New York occurred in this case, given Brecht,

2. Properly characterizing the taint issue arising under Kasti-

gar v. United States, 406 U.S. 441 (1972) as “factbound”, the

Government urges that the District Court's findings are “sup-

ported by the record” and do not warrant further review.

(Brief for the United States at 10). But a comparison between

the factual arguments in the Government's brief (at 10-14) and

the findings by the District Court on the Kastigar issue (Pet.

App. A19-23) shows that the findings of the District Court

upon which the Government relies never mention, much less

6

determine, the Kastigar issues raised by this record and briefed

by the parties. The petition is an invitation to the Court, not to

sit as an appellate factfinder on contested questions of fact,

but rather to define as a matter of law the scope of the taint

issues that should have been decided on the factual record

before the District Court. Except for its fanciful suggestion (at

11) that United States v. Apfelbaum, 445 U.S. 115, 124-25

(1980), forecloses a single issue (use of immunized testimony in

plea bargaining) which Apfelbaum never addressed, the Gov-

ernment's brief misses the central point.

The Government's assertions in fact support the grant of

certiorari. It does not deny that prosecutors who knew the

petitioner's immunized testimony participated in strategic deci-

sions in his prosecution or that he was cross examined about

matters disclosed in his immunized testimony before the Grand

Jury and in a highly publicized criminal trial. Instead, its brief

emphasizes the findings of the District Court that Assistant

U.S. Attorney Mescon and FBI Special Agent Cassidy were

“highly credible” and that both asserted that they were un-

aware of “the substance of petitioner's immunized testimony”

(Brief for the United States at 11, 14). The showing made in

the petition, in the absence of any proof of untainted source by

the Government, that the immunized testimony was a probable

source for petitioner's cross examination is similarly dismissed

as speculatilon]“ or “conjectur[e]” (Id. at 13, 14).* Other

The Government's treatment of the facts in this context is mislead-

ing. For example, one significant portion of the cross examination

elicited admissions of payments he had made to employees of Hellenic

Lines, his company's principal customer. Assistant U.S. Attorney

Mescon testified that the cross examination on this point arose from a

specific suggestion by Special Agent Cassidy that he ask about such

payments and that he had been wholly ignorant of the subject before-

hand (H. Ir. 78-0, 118), Cassidy, who had participated in the Scotto

trial at which Mr. Seregos had publicly admitted these payments and

who was authorized to and did discuss pre-indictment matters involv-

ing Mr. Seregos (H. Tr. 85-87, 102-103), did not offer any source

whatever for his suggestion. The lengthy argument in the Govern-

7

contentions are dismissed for failure to show “prejudice”. (Id.

at 12). But Xastigar requires not merely that the Government

show that tts prosecution was not tainted by the defendant's

previous immunized testimony but a/so imposes “the affirma-

tive duty to prove that the evidence it proposes to use is derived

from a legitimate source wholly independent of the compelled

testimony,” 406 U.S. at 460, including its cross examination of

the defendant, New Jersey v. Portash, 440 U.S. 450 (1979),

and its trial strategy and plea bargaining. United States v.

McDaniel, 482 F.2d 305, 311 (8th Cir, 1973). Factual argu-

ments by the Government in its brief in this Court on contested

issues are not such proof, and silence by the District Court is

not findings.

The promise the Court made in Xastigar means little if the

failure by the District Court to address the taint issues raised

by the record, and the failure of the Government to discharge

its burden under Kastigar to show an untainted source for its

evidence, can be explained away, as the Government seeks to

here, by the mere assertion of Government witnesses, however

credible, that they were ignorant of “the substance” of the

defendant's immunized testimony, or by a reliance on he

petitioner's failure to show prejudice or to establish beyond

doubt a tainted source when the Government has shown no

source at all. The issue raised by this petition is whether

Kastigar is a promise the Court means to have kept.

ment's brief (at 13 n. that the question was asked as part of “the

natural development of cross-examination” has no foundation in the

testimony. The fact that Mr. Mescon did not “learn” that the payments

had been made until it was admitted on cross examination (Je. at 13)

does not excuse the asking of a question based on a tainted source.

CONCLUSION

For the foregoing reasons, the petition for a writ of cer

tiorari should be granted.

Respectfully submitted,

JOHN D. GORDAN, III

LAURIE E. FOSTER

25 Broadway

New York, New York 10004

(212) 344-8480

Attorneys for Nicholas Seregos