Opposition — Fusaro v. United States

| Office- Supreme Raur

me Court, U.S.

FILED

Noy 15 @3

No. 83-124

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In the Supreme Court of the Mnited States

OCTOBER TERM, 1983

NUNZIATO FUSARO, PETITIONER

Vv.

UNITED STATES OF AMFPICA

ON PETITION FORA WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE FIRST CIRCUIT

BRIEF FOR THE UNITED STATES IN OPPOSITION

Rex E. Lee

Solicitor General

STEPHEN S. TROTT

Assistant Attorney General

PATRICK COUGHLIN

Attorney

Department of Justice

Washington, D.C. 20530

(202) 633-2217

QUESTIONS PRESENTED

1. Whether petitioner’s indictment charging violations

of 18 U.S.C. 1005 adequately alleged that petitioner acted

with intent to injure or defraud.

2. Whether, after the district court conducted a hearing

and determined that a conversation between the jury fore-

man and an FBI agent who was not involved in petitioner’s

case did not result in any prejudice, the court should also

have examined the juror despite petitioner's failure to

request such an examination.

(1)

TABLE OF CONTENTS

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TABLE OF AUTHORITIES

Cases:

Hagner v. United States, 285 U.S.427 .

Hamling vy. United States, 418 U.S. 87 .

Harrison v. United States, 279 F.2d 19,

cert. denied, 364 U.S. 864 ...........

Morissette v. United States, 342 U.S.

UU ctr bulk baa dees nes peat) cede k es

RCE LEs duh ua eiiedhes dé 60 64.64.0660

Smith vy. Phillips, 455 U.S. 209, 217 ....

United States v. Almonte, 594 F.2d 261

United States v. Boscia, 573 F.2d 827,

cert. denied, 436 U.S. 911 ...........

United States v. Buchanan, 633 F.2d 423,

cert. denied, 451 U.S.912 ...........

United States v. Doe, 513 F.2d 709 ....

United States v. Docherty, 468 F.2d 989

United States v. Kent, 608 F.2d 542,

cert. denied, 446 U.S. 936 ...........

(IIT)

IV

Page

Cases—Continued:

United States v. Lubrano, 529 F.2d 633,

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United States v. Mann, 517 F.2d 259,

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United States v. Moraites, 456 F.2d 435,

ER. SN, Uh PE odbc ccccccccacsess 7

United States v. Morrison, 536 F.2d 286........ 7

United States v. Murdock, 290 U.S. 389 ........ 6

United States v. Pollack, 503 F.2d 87 ........ 4,7

United States v. Pomponio, 429 U.S. 10 ........ 6

United States v. Tidwell, 559 F.2d 262,

Gs I OI. OE Piebecawsiccccesecns 5

Statutes:

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In the Supreme Court of the Mnited States

OCTOBER TERM, 1983

No. 83-124

NUNZIATO FUSARO, PETITIONER

V.

UNITED STATES OF AMERICA

ON PETITION FORA WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE FIRST CIRCUIT

BRIEF FOR THE UNITED STATES IN OPPOSITION

OPINION BELOW

The opinion of the court of appeals (Pet. App. Al-A16) is

reported at 708 F.2d 17.

JURISDICTION

The judgment of the court of appeals (Pet. App. B1) was

entered on May 26, 1983. The petition for a writ of certio-

rari was filed on July 21, 1983. The jurisdiction of this Court

is invoked under 28 U.S.C. 1254(1).

STATEMENT

Following a jury trial in the United States District Court

for the District of Massachusetts, petitioner was convicted

on 15 counts of misapplication of bank funds (18 U.S.C.

656), six counts of issuing unauthorized checks (18 U.S.C.

1005), four counts of making false entries in a bank state-

ment (18 U.S.C. 1005), ten counts of making false state-

ments for the purpose of influencing action on bank loans

(1)

2

(18 U.S.C. 1014), and one count of conspiracy (18 U.S.C.

371).! He was sentenced to concurrent terms of three years’

imprisonment, with all but 30 days suspended in favor of

probation, and fines totaling $40,000. The court of appeals

affirmed (Pet. App. Al-A16).

1, The evidence at trial showed that in late 1979 and early

1980 petitioner—along with co-defendants Richard Sac-

cone and Richard Robidoux—fraudulently arranged over

$600,000 in loans to Robidoux from the Mohawk Trust and

Savings Bank, a small bank in Greenfield, Massachusetts.

Saccone was president of the bank. Petitioner is an attorney

who represented both the bank and Robidoux, who owned

an automobile dealership. Robidoux’s business was in

serious financial trouble. Although Mohawk was capital-

ized at only $300,000 and could lend not more than $60,000

to any person, petitioner and Saccone managed to lend

more than ten times that amount to Robidoux. The loans

were made without the approval of the bank's executive

committee. The financial bleeding of Mohawk by petitioner

and his co-defendants took only three months. The bank

was closed in February 1980, and a Federal Deposit Insu-

rance Corporation liquidator took over. Pet. App. A2-AS5.

2. At trial, petitioner claimed that the Section 1005

counts in the indictment were deficient because they did not

allege that he acted with intent to injure or defraud the

bank. The district court rejected that claim, but instructed

the jury that it had to find that petitioner intended to injure

or defraud the bank in order to convict him under para-

graph one of Section 1005 (Pet. 5n.6). On appeal, petitioner

renewed his claim that the indictment was defective because

it failed to allege intent. The court of appeals held that

because the indictment tracked the language of the statute,

‘Petitioner was acquitted on three counts of improper receipt of a

commission for procuring a loan (18 U.S.C. 215)

3

described the offense with sufficient clarity to show a viola-

tion of the law, and enabled petitioner to know the nature of

the charge against him, it was sufficient (Pet. A9). The court

found in any event that any error in the indictment was

harmless since the trial court instructed the jury that it must

find an intent to injure or defraud in order to convict

petitioner (ibid.).

On the second day of trial an FBI agent who was not

involved in this case met the foreman of petitioner's jury in

the hall of the courthouse. They recognized one another

from a woodworking class, and talked for five minutes. The

conversation did not refer to the trial. When the FBI agent

learned of the juror's status, he avoided further contact with

him, (Pet. App. Al0-A11).

The conversation was brought to the court's attention,

and the trial judge questioned the agent thoroughly with

petitioner's counsel present. The court found that no preju-

dice had occurred, and petitioner's counsel agreed. A short

time later, however, after consulting with his client, peti-

tioner'’s counsel moved to excuse the foreman. He did not

request a voir dire of the foreman. The district court denied

the motion. The court of appeals upheld this action, finding

no abuse of discretion in the trial court's ruling that the

encounter was harmless. (Pet. App. All).

ARGUMENT

1, Petitioner contends (Pet. 6-11) that intent to injure or

defraud is an element of an offense under paragraph two of

18 U.S.C. 1005? and that his conviction must be reversed

?In fact, the district court charged the jury under paragraph one of 18

U.S.C. 1005 (Pet. 5 1.6), and the court of appeals concluded that it was

that paragraph that petitioner was convicted under (Pet. Ayr. A2). The

indictment charged that Saccone, “being an officer and director of

Mohawk,” and aided by petitioner and Robidoux, issued “drafts and

orders of Mohawk, in the form of Mohawk Treasurer's checks” (C.A.

App. |6). The first quoted phrase is relevant only to paragraph one of

4

because the indictment failed to allege such intent.’ He

argues that by affirming his convictions, the court of

appeals has decided that intent to defraud is not an element

under paragraph two of Section 1005, and that its decision

conflicts with decisions of the Second and Ninth Circuits.

These claims are without merit. Even if intent to injure or

defraud is an element of all Section 1005 violations—a

matter on which the court of appeals expressed no opinion—

the indictment sufficiently alleged the requisite intent and

the trial court instructed the jury that it must find such

intent. Thus petitioner's convictions cannot be affected no

matter how the question about intent is ultimately resolved.

Although paragraph three of 18 U.S.C. 1005 specifically

requires an “intent to injure or defraud” a bank, neither of

the first two paragraphs mentions that element. The Ninth

Circuit has nevertheless held that intent to injure or defraud

is an essential element under all three paragraphs of Section

1005. United States v. Pollack, 503 F.2d 87, 90 (9th Cir.

1974), The Second Circuit has come to the same conclusion

concerning 18 U.S.C. 656—a different, but related, statute.

United States v. Docherty, 468 F.2d 989 (2d Cir. 1972). See

also Ramirez v. United States, 318 F.2d 155, 157-158 (9th

Section 1005; the second seems to refer to paragraph two of Section

1005. Since violations of paragraph one are also covered by paragraph

two, however, and since petitioner's claim about intent to injure or

defraud seems equally applicable to both sections (Pet. 4n.2), we do not

think the difference is significant.

‘We note that this contention relates to only six of the 36 counts on

which petitioner was convicted. Since he received concurrent jail and

probationary terms on al! counts, all that is at stake with respect to this

issue is $6,000 out of the total of $40 000 in fines to which he was

sentenced

5

Cir. 1963) (18 U.S.C. 656).4 In this case the court of appeals

concluded that petitioner's “objection to the indictment

affords us no opportunity to decide the section 1005 intent

issue” (Pet. App. AQ).

Given the language of the indictment, that conclusion

was proper. Counts 19-24 not only tracked the language of

Section 1005° but also, as the court of appeals noted,

“described [the offense] with sufficient clarity to show a

‘In Harrison v. United States, 279 F.2d 19 (Sth Cir.), cert. denied,

364 U.S. 864 (1960), the Fifth Circuit stated that intent to injure or

defraud is not an essential element of offenses under the first two

paragraphs of 18 U.S.C. 1005, 279 F.2d at 23. The court noted, though,

that Harrison's indictment charged an intent to defraud (ibid.), and that

“there was ample evidence from which the jury could find the necessary

* © * ingredient of the crime" (/d. at 24). More recent Fifth Circuit cases

Suggest that the court may be inclined to reconsider its statements in

Harrison. See United States vy. Mann, $17 F.2d 259, 267 (1975), cert.

denied, 423 U.S. 1087 (1976); United States v. Tidwell, $89 F.2d 262,

267 (1977), cert. denied, 435 U.S, 942 (1978).

‘In relevant part, the indictment stated (C.A. App. 16):

COUNTS NINETEEN THROUGH TWENTY-FOUR

On or about the dates hereinafter set forth in these counts,

Counts Nineteen through Twenty-Four, in the District of Massa-

chusetts, Richard Saccone, being an officer and director of

Mohawk, the deposits of which were insured by the F.D.1.C., and

Nunziato Fusaro and Richard E. Robidoux, the defendants,

aided and abetted by each other, did knowingly, unlawfully and

willfully, without authority from the directors of Mohawk, issue,

and cause to be issued, drafts and orders of Mohawk, in the form

of Mohawk Treasurer's checks, as further described hereinafter in

these counts, Counts Nineteen through Twenty-Four,

COUNT DATE PAYEE AMOUNT

19 11/2/79 United Chevrolet, Inc. $50,000.00

20 11/2/79 Richard E. Robidoux $50,000.00

2! 11/$/79 Irving Heller $50,000.00

22 11/5/79 Dr. Anthony Micelotti $50,000.00

23 11/6/79 Bernard Quitt $50,000.00

24 11/6/79 Richard Ricciardi $50,000.00

6

violation of law, and enable[d petitioner] to know the

nature and cause of the accusation against him and to plead

an acquittal or conviction in bar of future prosecution for

the same offense” (Pet. App. A9). See Hamling v. United

States, 418 U.S. 87, 117 (1974).

Petitioner argues that tracking the language of the statute

is insufficient here, since the codified version of the statute

has erroneously omitted the phrase “intent to injure or

defraud” (Pet. 5 &n.3, 7-8). But even if that is so—a matter

which we do not concede—in this case the indictment did

state that petitioner had acted “knowingly, unlawfully and

willfully,” terms that are well understood to signify an evil

intent or mental culpability. See Morissette v. United

States, 342 U.S. 246, 264 (1952); United States v. Pompo-

nio, 429 U.S. 10, 12 (1976); United States v. Murdock, 290

U.S. 389, 394-395 (1933); United States v. Kent, 608 F.2d

$42, 545 n.3 (Sth Cir. 1979), cert. denied, 446 U.S. 936

(1980).¢ In determining whether an essential element of an

*Nor is there any doubt here that the grand jury—in describing the

issuance of the bank's checks as having been done not only without

authority from he directors, but also “knowingly, unlawfully and

willfully” —- considered and meant to address the element of intent to

defraud. In stating counts $-8—which charged violations of 18 U.S.C.

656 in connection with the issuance of checks to Heller, Micelotti, Quitt,

and Ricciardi (cf. counts 21-24, note 5 supra)—the grand jury con-

cluded that (C.A. App. 15):

Saccone [aided and abetted by petitioner] caused the issuance of

Mohawk Treasurer's check{s] * * * in the names set forth * * °,

knowing and concealing from the bank the fact that the monies

* © © were intended for the use and benefit of defendant Robi-

doux and the obligation to repay was concentrated in Robidoux,

falsely creating the appearance that the monies and funds had

been disbursed to, and the obligation to repay existed in, the

individuals named hereinafter; when in fact the nominal recipients

of the monies * * * had neither requested, nor received said

monies and funds and had not obligated themselves to repay said

monies and funds, whereby the safety and soundness of Mohawk

stockholder and depositor funds and monies was jeopardized, and

said monies and funds were depleted and lost to said bank.

-

offense has been omitted, it is not necessary that any partic-

ular word or phrase appear. The indictment may be phrased

in any form which substantially states the element. Hagner

v, United States, 285 U.S. 427, 433 (1932), For example in

Ramirez vy. United States, 318 F.2d at 158, the Ninth

Circuit held the indictment under 18 U.S.C. 856 to be

sufficient despite its failure to use the phrase “an intent to

injure and defraud,” since the phrase “did wilfully mis-

apply” adequately encompassed the necessary intent ele-

ment. See also United States v. Moraites, 456 F.2d 435,

440-441 n.9 (3d Cir.), cert. denied, 409 U.S, 891 (1972) (18

U.S.C. 656).’

2. Petitioner also argues (Pet. | 1-14) that his conviction

should be reversed because the trial court failed to examine

the jury foreman after that individual's brief conversation

with an FBI agent. This claim is without merit. Petitioner

The statement of counts 19-24 immediately follows this recital (C.A.

App. 16). In addition, the statement of count | (conspiracy) shows that

the grand jury was fully cognizant of the specific objective which counts

19-24 charged petitioner with pursuing (C.A. App. 9):

Inearly November of 1979, defendants, Robidoux, Fusaro, and

Saccone * * * did forma plan to channel a total of $720,000.00 of

Mohawk funds to Richard Robidoux and his interests through a

series of unsecured nominee loans so as to create the appearance

that the loans did not violate the legal lending limit, and the

appearance that the nominees were in fact obligated to repay the

notes, when in effect, the concentration of funds and the obliga-

tion to repay in Robidoux and his interests did violate the legal

lending limit and the nominees had not borrowed the funds nor

obligated themselves to repay the funds borrowed in their names,

thereby the defendants and co-conspirators did jeopardize the

safety and soundness of Mohawk stockholder and depositor

funds.

*The Ninth Circuit's decisionin United States v. Pollack, $03 F.2d at

91, which seems to conflict with that court's conclusion in Ramirez on

this point, is explained in United States v. Morrison, $36 F.2d 286,

288-289 & n.7 (9th Cir. 1976),

8

never requested a voir dire of the juror, so the claim depends

upon a finding of plain error. And the essentially factual

determination by both courts below that no prejudice

occurred does not warrant further review by this Court.

In Smith v. Phillips, 455 U.S. 209, 215 (1982), this Court

noted that “the remedy for allegations of juror partiality is a

hearing in which the defendant has the opportunity to prove

actual bias.” Here the district court conducted a hearing at

which both the prosecutor and the FBI agent who spoke to

the jury foreman were questioned. Petitioner's counsel was

present, and did not ask to have the foreman questioned.

Nor did he do so later, when he moved to dismiss the juror.

Petitioner cannot now complain of the trial court's failure

to conduct such an examination. As both courts below

recognized, petitioner has simply failed to sustain his

burden of proving that the juror was biased, or that any-

thing improper occurred. A district court has considerable

discretion in determining the scope and nature of the inves-

tigation needed to evaluate a claim of impermissible jury

contact. United States v. Doe, 513 F.2d 709, 712 (Ist Cir.

1975); United States v. Almonte, 594 F.2d 261, 266( Ist Cir.

1979); United States v. Boscia, 573 F.2d 827, 831 (3d Cir.),

cert. denied, 436 U.S. 911 (1978); United States v. Bucha-

nan, 633 F.2d 423 (Sth Cir.), cert. denied, 451 U.S. 912

(1981). Indeed, no evidentiary hearing is necessary when

communication with a juror is totally unrelated to matters

pending at trial and no prima facie showing of prejudice is

made. United States v. Lubrano, 529 F.2d 633, 638 (2d Cir.

1975), cert. denied, 429 U.S. 818 (1976); United States v.

Boscia, 573 F.2d at 831. Here the district court concluded,

after examining the FBI agent, that further inquiry was not

warranted. Petitioner has not shown why that conclusion

was erroneous. “[D]ue process does not require a new trial

every time a juror has been placed in a potentially com-

promising situation.” Smith vy. Phillips, 455 U.S. at 217.

9

CONCLUSION

The petition for a writ of certiorari should be denied.

Respectfully submitted.

Rex E. LEE

Solicitor General

STEPHEN S. TROTT

Assistant Attorney General

PATRICK COUGHLIN

Attorney

NOVEMBER 1983

DOJ-1983-11