Appendix — Satterwhite v. United Parcel Service, Inc.

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APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

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Unrrep States or AMERICA, Plaintiff-Appellee,

va f No. 72-2983

Micuagz. Santo Pouizz1, Defendant-Appellant. \

Unirep States or AMERICA, Plaintiff-Appellee,

i No. 72-2984

Jack S. Suarmo, Defendant-Appellant.

Unrrep States or Axrnica, Plaintiff-Appellee,

ies eed |

Perer JAMES BELLANCA, Defendant-Appellant.

- Unrrep States or AMERICA, Plaintif(-Appellee,

es Applies, | 72-2986

ANTHONY GIARDANO, Defendant.Appeilant. >

Unrrep STATES OF AMERICA, pia; tiff-Appellee,

a No. 72-2987

Artuur J. Rooxs, Defendant-Appellant.

Unirep States or AMERICA, Plaintiff-Appellee,

vs. No. 72-2988

ANTHONY JosEPH ZERILLI,

Def endant-Appellant.

Unrrep States or AMERICA, Plaintiff-Appellee,

7 f No. 72-2989

Emprise CorPoraTIon,

a New York Co i

Defendant-Appellant. | OPINION

[April 30, 1974]

Appeal from the United States District Court

for the Central District of California

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2 United States of America vs.

Before: BROWNING and DUNIWAY, Circuit Judges, and

RENFREW,® District Judge.

RENFREW, District Judge:

In 1966 and 1967, appellants Zerilli and Polizzi acquired hid-

den interests in Vegas Frontier, Inc. (VFI), a Nevada corpora-

tion, which leased and operated the Frontier Hotel in Las Vegas,

Nevada. VFI was also licensed to conduct gambling at the hotel,

which opened in July of 1967. Neither Zerilli nor Polizzi was

licensed by the Nevada gaming authorities, nor was either man’s

interest in VFI disclosed to those authorities. After extensive ne-

gotiations, VFI was sold in November, 1967, to Howard Hughes.

Following a very lengthy and complex trial,) Zerilli, Polizzi,

and the other appellants were convicted of conspiracy (18 U.S.C.

§371) to violate 18 U.S.C. §1952* (Interstate and Foreign Travel

or Transportation in Aid of Racketeering Enterprises) and of

substantive violations of that section. Appellants challenge their

convictions on a number of bases. They contend:

1. That the prosecution failed to show a violation of

§1952.

*The Honorable Charlies B. Renfrew, United States District Jndge,

Northern Distriet of California, sitting by designation.

‘There were 48 days of trial reported in 11,022 pages pages of reporter's

718 U.S.C. §1952 provides in part:

“(a) Whoever travels in interstate or foreign commerce or uses any

facility in interstate or foreign commerce, including the mail, with intent

ya

(1) distribute the proceeds of any unlawful activity; or

< _. (2) commit any crime of violence to further any unlawful sc-

the promotion, or carrying on, of any

and thereafter performs or attempts to any of the acts specified

in subparagraphs (1), (2), and (3), shall be finei not more than

for not more five ’

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Michael Santo Polizzi, et al. 3

2. That, if a violation were shown, the laws in question

would be unconstitutionally vague.

3. That the court erred in instructing the jury.

4. That the publicity surrounding their trial deprived

them of a fair trial and that there was jury misconduct

which the court refused to investigate.

5. That the label “Mafia” was applied to them in a public

list of Mafia figures made by the Department of Justice and

that the list was submitted in the grand jury proceedings

and in the trial in this case and that these actions constitute

a deprivation of their rights of due process.

6. That the trial court committed error in the permission

it gave to the prosecution to cross-examine certain of the

appellants about their reputations as members of the Mafia

when the appellants had not presented evidence of character

or reputation.

7. That they were deprived of a fair trial by misconduct

of the prosecutor which the trial court sanctioned.

8. That the testimony of a key prosecution witness should

d have been stricken in that the prosecution’s untimely produc-

tion of his pretrial statements violated the Jencks Act.

9. That error was committed in the admission of the testi-

mony of that witness on the grounds that part of the testi-

mony was conclusively demonstrated to be false, and admitted

to be false by the witness.

; 10. That promises of leniency made to the witness by the

; prosecution were not disclosed.

11. That the acts complained of were a unitary crime and

that it was not proper for them to be convicted of a con-

spiracy and substantive violations based upon the same

conduct.

12. That the venue of the trial court was improper.

13. That the court below erred in refusing to grant appel- ’

lant Giordano’s motion for severance.

14. That the court below erred in failing to instruct the

jury that evidence admitted after appellant Giordano had

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4 United States of America vs.

rested at the close of the prosecution’s ease could not be con-

sidered against him.

15. That’ appellant Giordano’s motion for aequittal at the

close of the prosecution’s case should have been granted.

16. That appellant Emprise is not liable for any criminal

acts that its predecessor in interest allegedly committed.

17. That the evidence was insufficient to support their

convictions.

18. That the trial was materially tainted by leads from

unlawful electronic surveillance.

Having carefully considered each of these contentions, we affirm

the convictions below. Although this opinion is longer than we

would have preferred, appellants have raisd and argued so many

points in 534 pages of briefs, exclusive of appendices and exhibits,

that we find a lengthy opinion unavoidable. '

I. Violation of §1952

Appellants’ threshold contention is that their conduct did not

come within the coverage of the federal Travel Act (18 U.S.C.

§1952), raising two issues as to the meaning of the statute. Sec-

tion 1952 condemns interstate travel or the use of interstate facili-

ties in the furtherance of “any ~ulawful activity,” defined as

including “any business enterpr:.. involving gambling * * °

offenses in violation of the laws of the State in which they are

committed or of the United States * * *.” A violation of §1952

thus must be premised upon another distinct violation of state

or federal law.

Although state law becomes the focus of this inquiry, “the

gravamen of'a charge under §1952 is the violation of federal

law * * *.” United States v. Karigiannis, 430 F.2d 148, 150 (7

Cir. 1970) (Clark, J.), cert. denied 400 U.S. 904 (1970). “Refer-

ence to state law is necessary only to identify the type of un-

lawful activity in which the defendants intended to engage.”

United States of America v. Rizzo, 418 F.2d 71, 74 (7 Cir. 1969),

cert. denied 397 U.S. 967 (1970).

While the Government’s theory was not succinctly stated, either

in its briefs or at oral argument, it does emerge from a careful

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Michael Santo Polizzi, et al. 5

reading of the indictment and information*® together with the

court’s instructions to the jury* that appellarts violated the

federal Travel Act by conduct which was a “busi: ess enterprise”

that involved “gambling * * * offenses” in violation of Nevada

Revised Statutes (N.R.S. §463.1605 in that Zerilli and Polizzi’s

tion names appellant Eraprise Corporation, the successor in interest to a

merged corporation of the same name which had been dismissed from the

indictment for lack of personal jurisdiction prior to trial.

‘Both the information and indictment contain the following language,

charging appellants with traveling “in interstate commerce and [using]

facilities in interstate commerce with intent to:

“1. Distribute the proceeds «f unlawful activity, namely: the owner-

ship, operation of, and receipt of profits from a Las Vegas, Nevada

gaming casino by persons who were not licensed and whose interest in

the gaming casino had been concealed from agencies of the State of

Nevada in violation of Nevada law; and

“2. Promote, manage, establish, carry on, and facilitate the promotion,

The court’s instructions to the jury were also couched in terms of the

failure to disclose the interests of Zerilli and Polizzi in VFI.

SNevada Revised Statutes (N.R.S.) §463.160 iays down the basic law

requiring a license for gambling operations:

“1. It is unlawful for any person, either as owner, lessee or

whether for hire or not, either solely or in conjunction with others:

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6 United States of America vs.

interests in the gambling conducted by VFI at the Frontier

Hotel were hidden from the Nevada gaming authorities.

Appellants’ first argument is that since VFI had a gambling

license as required by Nevada law, their activity could not be

unlawful within the meaning of the federal Travel Act. They

rely considerably on one instruction, to which the government

did not object, that VFI was licensed and that the gambling it

conducted zould not be found illegal. Appellants’ counsel stated

at oral argument that, even if appellants procured the VFI

license fraudulently, there would be no criminal violation of

Nevada law. We disagree.

This instruction meant only that the trial court did not believe

that the prosecution could rely upon N.R.S. §463.160(1) (a). The

license would not be viewed as void ab initio, and the appellants

could not be prosecuted for conducting a gambling enterprise

without a license. Nor could the prosecutor “pierce the corporate

veil” to reach appellants.? The instruction does not, however,

legitimize all the acts of appellants in obtaining the license.

N.R.S. §463.160(1)(¢) covers precisely the charges here against

appellants: receiving compensation from gambling conducted

without having procured and maintained licenses as required by

law.®

tive, policymaking or supervisory, are individually qualified to be li-

censed under the provisions of this chapter.”

[Appellants contend that the revised N.R.S. §463.170(2), effective

July 1, 1967, should have been applied. In footnote 11, infra, we point

out the error in that contention.)

The statute governing the disclosures to be made in an application for

a license provides:

“2. The application shall include:

a e * . eo

“(d) The names of all persons directly or indirectly interested in the

business and the nature of such interest.” N.R.S. §463.200.

The forms supplied for an application by a corporation indicate that

corporate officers and stockholders are to be listed as those persons inter-

ested in the business.

Since in this case a license was issrzd to the corporation VFI, any

gambling conducted by or through VFI would not be illegal and would

not be in violation of this statute [N.R.S. (463.160].” Reporter’s Tran-

script, Vol. 43, p. 8798.

TSee footnote 13, infra.

8See footnote 5, supra, for the language of the statute.

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Michael Santo Polizzi, et al. 7

Appellants argue, however, that N.R.S. §463.160(1)(¢c) only

requires that the gambling be licensed and does not reach fraud

or other violations in obtaining the license. Acceptance of this

construction of Nevada law would effectively emasculate the

statutory scheme of requiring the disclosure of the identities of

the persons who would be involved in the gambling enterprise.

This disclosure requirement has as its purpose the prevention of

the infiltration of criminal elements into gambling in Nevada.®

Section 463.160(1)(¢) requires not only that a license be pro-

cured and maintained, but also that it must be procured and

maintained in a manner that satisfies the other provisions of the

gambling law. The term “as required by statute” must be viewed

in light of the strong state policy behind the statutes. The inter-

pretation offered by appellants would give free rein to criminal

elements in their attempts to infiltrate Nevada gambling. The

most they would risk would be the administrative revocation of

their corporation’s license. They would become criminally liable

only if they operated a gambling enterprise without procuring a

license, and the most dangerous elements could easily avoid such

a blatant violation of Nevada law. Given these considerations,

Tt is hereby declared to be the policy of this state that all establish-

ments where gambling games are conducted or operated or where gam-

bling devices are operated in the State of Nevada shall be licensed and

controlled so as to better protect the public health, safety, morals, good

order and general welfare of the inhabitants of the State of Nevada.”

N.R.S. §463.130(1).

The Nevada Supreme Court, in a decision handed down two years

prior to the enactment of the statutes here in question, gave a strong

policy basis for the licensing requirement:

“Nevada gambling, if it is to succeed as a lawful enterprise, must be

free from the criminal and corruptive taint acquired by gambling beyond

our borders. If this is to be accomplished not only must the operation

of gambling be carefully controlled, but the character and background of

those who would engage in gambling in this state must be carefully

scrutinized.

«“e © © The risks to which the public is subjected by the legalizing of

this otherwise unlawful activity are met solely by the manner in which

licensing and control are carried out.” Nevada Tax Commission v. Hicks,

73 Nev. 115, 119-120, 310 P.2d 852, 854 (1957). See also Berman v.

Riverside Casino Corporation, 247 F.Supp. 243, 250 (D.Nev. 1964), aff’d,

354 F.2d 43 (9 Cir. 1965).

This statement of policy was not qualified but rather reaffirmed by

N.R.S. §463.130(1), supra.

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8 United States of America vs.

the only reasonable construction of N.R.S. §463.160(1)(c) is that

persons receiving compensation from the gambling operation must

fulfill all other state requirements surrounding the granting of a

license.'°

Appellants violated those other provisions by failing to disclose

the identities of Zerilli and Polizzi as persons having an interest

in VFI. Under N.R.S. §463.170(2), applicants for a corporate li-

cense had to disclose “persons having any direct or indirect inter-

est therein of any nature whatsoever, whether financial, adminis-

trative, policymaking or supervisory * * *.”!1 The disclosure re-

quirement must be complete in order to meet the policy of the

Nevada gambling laws. Appellants stress that the corporate-license

application form supplied by the state required only the listing of

the names of corporate officers and shareholders. Since VFI’s ap-

plication complied with this requirement, they argue, there was no

disclosure requirements are directed. The Attorney General of

Nevada in 1960 gave his opinion that N.R.S. §463.170(2) gave

10See Huddleston v. United States, ..... U.S. ., ... .. (1974); ef.

Rewis v. United States, 401 U.S. 808, 811-812 (1971).

11Appellants have contended in their briefs that the revision of this

section effective July 1, 1967, should be applied. They did not press this

their contention untenable. Although

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Michael Santo Polizzi, et al. 9

power to state authorities “to require those persons having admin-

istrative, policymaking or supervisory interest in the operation to

qualify for licensing.” To utilize that authority effectively, he

stressed, the authorities would need to obtain information about

those persons. Official Opinions cf the Attorney General of Ne-

vada, 1960-1962, pp. 83-84 (1960). There was no hint that formal-

ities suffice or should be exalted over substance. In this case, the

information and indictment emphasized that Zerilli and Polizzi

held the real interests in VFI and controlled the nominal share-

holders. The trial court, in its instructions on the definition of

“owner” as used in the Nevada statutes, streased the reality of

ownership rather than formal titles. (Reporter’s Transcript, Vol.

43, p. 8765.) These statutes require disclosure of the names of all

persons with actual control or financial interests in the gambling

enterprise.12

The acts of appellants charged and proven in this case therefore

were prohibited by state law.’* Appellants, however, raise further

objections. They contend that, even if they did violate Nevada law,

their violations were not criminal and therefore do not come with-

in the ambit of §1952. They characterize their conduct as merely

12The record reveals that the Nevada authorities sought in this case to

to the manner in which the Nevada gaming authorities have con-

ened tho chitin uahes abs ewe

'8Two other theories put forward by the government fail. One involves

a direct or indirect interest in a gambling enterprise must be licensed.

That statute, however, requires only that licenses must be procured as

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required by the law. N.R.S. §463.170(2) indicates that a corporation can

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in the corporation must only be qualified to be licensed. See also Berman

v. Riverside Casino Corporation, 354 F.2d 43 (9 Cir. 1965).

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10 United States of America vs.

“operating a casino with a state corporate license but without

other required state licenses.” That theory, however, is based upon

the government’s contention that all persons with a direct or indi-

rect interest in a gambling casino must be licensed. We find no

such requirement in Nevada law.'4 The violations of Nevada law

in question here were not by VFI, but rather by those in control

of VFI who did not disclose the interests of Zerilli and Polizzi.

The trial court preserved the corporate fiction and the legality of

the gambling operations conducted by the corporation. Hence ap-

pellants’ argument that N.R.S. §463.310 specifically establishes

only an administrative penalty available to the authorities in this

case—revocation of VFI’s license—is in error. That provision does

set the procedures for disciplinary action against the licensee, but

here the licensee has not been prosecuted for violating Nevada law.

Since there is no specific penalty prescribed for a violation of

N.R.S. §463.160(1)(¢c), the “catch-all” section, N.R.S. §463.360

(2)*5 would apply.’* That violation, there characterized as a gross

misdemeanor, would be a criminal infraction.'7

Appellants’ second argument is that §1952 reaches only wholly

unlawful business enterprises and, since gaming is legal in Nevada,

the federal Travel Act does not apply. They cite United States v.

Roselli, 432 F.2d 879 (9 Cir. 1970), cert. denied, 401 U.S. 924

(1971), rehearing denied, 402 U.S. 924 (1971), in support. Their

14See footnote 13, supra.

15“The violation of any of the provisions of this

for which is not herein specifically fixed, shall be deemed a gross mis-

not

both fine and imprisonment.”

16The Chairman of the Nevada Gaming Commission during the iime

in question testified that under the law then in effect, “any vi

of that law by individuals would mean that those individuals were guilty

of gross misdemeanors where no specific pcnalty was provided. Report-

er’s Transcript, Vol. 15, pp. 3026-302.

Indeed, other than conducting.a casino without a license, which is

exceedingly unlikely, it is difficult to imagine what N.R.S. §463.360(2)

wonld cover if it did not cover conduct such as that proved in this case.

170nce a violation of a state criminal statute has been proved it is

irrelevant whether that violation is classified as a felony or misdemeanor.

United States v. Karigiannis, 430 F.2d 148, 150 (7 Cir. 1970) (Clark,

J.), cert. denied, 400 U.S. 904 (1970).

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Michael Santo Polizzi, et al. 11

reliance upon Roselli is misplaced. There the Court accepted only

for the purposes of argument the premise that the scope of §1952

was limited to illegal business enterprises and even on that basis

found such an illegal enterprise (432 F.2d 879 at 887-888). Appel-

lants overlook that earlier in that opinion this Court observed :

“Tf section 1952 applied only when all business activity was

absolutely prohibited in the particular field, the reach of the

section would be materially diminished without apparent rea-

son in terms of the statute’s purpose. There is no evidence

that Congress intended this result.” 432 F.2d 879 at 887.

Nor do appellants’ general references to the legislative history of

§1952 support this contention.’* The statutory language is clear.

“Section 1952 speaks not of illegal gambling, but of a more inclu-

sive category: ‘gambling * * * offenses.’” United States v. Roselli,

432 F.2d 879, 887 (9 Cir. 1970), cert. denied, 401 U.S. 924 (1971),

rehearing denied, 402 U.S. 924 (1971). See also Turf Center, Inc.

v. United States, 325 F.2d 793, 795 (9 Cir. 1963).

This Court’s construction of the scope of §1952 will not open

the federal courts to the prosecutorial abuses which appellants

have depicted for the Court: prosecutions of minor illegal acts inci-

18Appellants rely heavily upon the statements of Assistant Attorney

General Herbert J. Miller, Jr., of the Justice Department’s Criminal

Division that:

“(The Travel Act] bans unlawful businesses—not incidental illegal

acts done in the course of lawful businesses.” (“Legislation Relating

to Organized Crime,” Hearings on H.R. 468 et al., Before Subcom-

mittee No. 5 of the House Committee on the Judiciary, 87th Cong.,

Ist Sess., p. 336 (1961).)

“Under this bill we would have to show a business enterprise which

was unlawful under the laws of the State * * *.” (“The Attorney

General’s Program to Curb Organized Crime and Racketeering,”

Hearings on S. 1653 et al., Before the Senate Committee on the

Judiciary, 87th Congress, Ist Sess., p. 260 (1961).)

In a law review article, the Assistant Attorney General explained the

impact of the statutory intention thusly:

“[(T]o turn a gambling * * * scheme into an ‘unlawful activity’ with-

in the meaning of the ‘Travel Act’ * * * the ‘business enterprise’

must involve illegal conduct. A program to establish a gambling ca-

sino in Las Vegas, Nevada, would not amount to ‘unlawful activ-

ity.” (Miller, The “Travel Act”: A New Statutory Approach to

Organized Crime in the United States, 1 Duquesne L.Rev. 181, 194

(1963) (emphasis in original).)

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12 United States of America vs.

dental to an otherwise legal business. The legislative history of

§1952 does demonstrate that its main purposes are to attack organ-

ized crime and to aid local authorities in combatting it.'® Courts

would simply not allow it to be used to extend federal prosecu-

tions far from these purposes.2° See Erlenbaugh v. United States,

409 US. 239, 245 (1972).

We conclude that appellants engaged in a business enterprise in-

volving gambling offenses in violation of Nevada law and 18 U.S.C.

§1952.

Il. Vagueness

Appellants challenge the statutes under which they have been

charged and convicted as being unconstitutionally vague. “No one

may be required at peril of life, liberty or property to speculate

as to the meaning of penal statutes. All are entitled to be informed

as to what the State commands or forbids. Lanzetta v. New Jersey,

306 U.S. 451, 453 (1939). Appellants’ attack is directed at the

Nevada statutes and not the language of §1952, which has been

upheld previously against claims of vagueness. See, ¢.g., United

States v. Cozzetti, 441 F.2d 344, 348 (9 Cir. 1971); Turf Center,

Inc. v. United States, 325 F.2d 793, 795 (9 Cir. 1963); United

States v. Smith, 209 F.Supp. 907, 917-918 (E.D.Ill. 1962). We have

already held that the Nevada statutes clearly proscribe the conduct

charged against appellants.*! The construction of those statutes

urged by appellants is unreasonable and conflicts with the manifest

purpose of the Nevada gambling legislation requiring precise and

stringent controls relating to the licensing of gambling. Violation

of the statutes in the manner charged against appellants is a crimi-

nal offense.*? In affirming these convictions, we are not enlarging

the original legislation by interpretation. Cf. Bouie v. City of Co-

19This history is outlined in some detail in United States v. Roselli, 432

F.2d 879, 884-888 (9 Cir. 1970).

2°Membership in an organized criminal group is not, of course, an ele-

ment of an offense under §1952. United States v. Roselli, 432 F.2d 879,

885 (9 Cir. 1970), cert. denied, 401 U.S. 924 (1971), rehearing denied,

402 U.S. 924 (1971). It rests with the courts to determine the reach of

$1952 in a case-by-case manner.

21See pages 5-10, supra.

22See page 11, supra.

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Michael Santo Polizzi, et al. 13

lumbia, 378 U.S. 347, 350-352 (1964); Pierce v. United States, 314

U.S. 306, 311 (1941)

Moreover, the trial court instructed the jury that specific intent

was ar cloment of the ofense charged against appellants.2? Thus

the jury found that appellants knew that Nevada law had been

violated in the procurement of VFI’s license. “A mind intent upon

willful evasion is inconsistent with surprised innocence.” United

States v. Ragen, 314 U.S. 513, 524 (1942). See also United States

v. National Dairy Corp., 372 U.S. 29, 33, 35 (1963); Screws v.

United States, 325 U.S. 91, 103 (1945). The record here is clear

that appellants were not the helpless victims of an unconstitution-

ally vague statute.*4

Ill. Jury Instructions

A. Nevada Statutes and Regulations

Appellants contend that the court below erred in several respects

in its instructions to the jury. Certain of these claims concern spe-

cifie instructions relating to the Nevada statutes. Appellants’ objec-

tions are based upon a misunderstanding of the government's legal

theory of the ease. Viewed as a whole, the court’s instructions con-

stitute a reasonable construction of §1952 and the Nevada statutes

governing the licensing of gambling operations.

Appellants also argue that it was error to read to the jury, with-

out explanation, N.R.S. §463.130.25 But that section is a self-explan-

atory statement of Nevada legislative policy and is important in

23While appellants contend that the instructions on specific intent were

erroneous, we find no such error. See pages 17-18, infra.

24The question of vagueness was considered before Congress enacted

41952. Assistant Attorney General Herbert J. Miller, Jr., testified before

the House Subcommittee that: “It can hardiy be contended that the aver-

age American citizen does not know if he is engaged, for example, in

‘any business enterprise involving gambling, liquor, narcotics, or prostitu-

tion offenses’ * * *. Since the bill in addition would require proof of the

requisite intent before a violation would be made ont, I believe that the

scope of H.R. 6572 in no way threatens the activities or righis of any

persons other than the organized criminals at whom it is aimed.” “Legis-

lation Relating to Organized Crime,” Hearings on H.R. 468 et al., Before

Subcommittee No. 5 of the House Committce on the Judiciary, 87th

Cong., Ist Sess., p. 336 (1961).

25See footnote 9, supra.

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14 United States of America vs.

understanding the purpose and meaning of the other sections. These

Nevada statutes form a unified legislative plan; particular sections

cannot be fully understood without relating them to the entire

statutory scheme. Therefore, under these circumstances, it was not

error to read to the jury sections other than N.R.S. §§463.160 and

463.200, the two sections upon which the indictment and informa-

tion were based.

N.R.S. §463.300, dealing with voting trust agreements, was also

read to the jury. Appellants argue that this was confusing, since

the court had earlier instructed the jury that the evidence pre-

sented had failed to establish a violation of §463.300. The court

refused appellants’ instruction which would have directed the jury

to disregard all evidence concerning the voting trust agreement.

In light of the court’s specific instruction, no further instructions

were necessary to prevent the jury from finding a violation of

§463.300. It is also highly uniikely that reading that section in

these circumstances confused the jury. Cf. United States v. Look-

retic, 422 F.2d 647, 651 (7 Cir. 1970), cert. denied, 398 U.S. 904

(1970).

Although conceding that the court properly charged the jury

that violations of the regulations of the Nevada State Gaming Com-

mission could not constitute criminal offenses, appellants neverthe-

less assert that error was committed in instructing that such a vio-

lation could be considered as an act in furtherance of a conspiracy.

This instruction was proper and necessary in that without it the

jury might have thought that it had to disregard completely a vio-

lation of the regulations.

B. Sending Statutes and Regulations to the Jury Room

Appellants urge that sending the statutes and regulations into

dicial error. This question is within the sound discretion of the

trial judge. United States v. Gross, 451 F.2d 1355, 1358-1359 (7

Cir. 1971); United States v. Bearden, 423 F.2d 805, 813 (5 Cir.

1970), cert. denied, 400 U.S. 836 (1970). In this case, the statutes

and regulations were extremely complex, and the trial judge may

justifiably have believed that it would be better to give the jury

the statutes and regulations rather than to have them attempt a

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Michael Santo Polizzi, et al. 15

reconstruction from notes or from memory. In his effort to avoid

confusion, the trial judge did not abuse his discretion.

C. Reading Indictment and Information to Jury and Sending

Copies to Jury Room

Appellants argue that it was reversible error to read the indict-

ment and information both at the beginning of trial and during

the instructions. Given the extraordinary length and complexity of

the trial, however, the trial court may properly have judged that

a re-reading was required to avoid confusion.?¢ The decision to read

the indictment to the jury is within the sound discretion of the

trial court> and we find no abuse of that discretion here.?7

The court below also sent to the jury room copies of the indict-

ment and information. That decision is also generally within the

discretion of the trial judge. United States v. Murray, 492 F.2d

178, 193-194 (9 Cir. 1973) ; Souza v. United States, 304 F.2d 274,

280 (9 Cir. 1962). Appellants contend that they should have been

advised before closing arguments that the court intended to send

the information and indictment. See Dallago v. United States, 427

F.2d 546, 553 (D.C.Cir. 1969). We agree, but the failure to do so

here is not prejudicial error.2* Under all the cireumstances of this

case, especially the court’s cautionary instruction on the use of the

indictment and information and the detailed instructions on what

could be considered evidence by the jury, we do not find that error

prejudicial in any respect.

26The indictment was first read on February 16, 1972, and re-read on

April 19, 1972, an interval of more than two months.

27The court instructed the jury as to the indictment and information:

“An Indictment or Information is but a formal method of accusing a

defendant of a crime. It is not evidence of any kind against the accused.”

28In United States v. Steed, 465 F.2d 1310, 1316 (9 Cir. 1972), cert.

: denied, 409 U.S. 1078 (1972), the court

: jary room upon the request of the jury during its deliberations. Despite

— A-16 —

16 United States of America vs.

D. Specific Intent

In claiming error in the court’s instructions on specific intent,?°

appellants urge us to follow United States v. Stagman, 446 F.2d

489, 492-493 (6 Cir. 1971), and hold that specific intent to violate

state law is an element of the offense under §1952. This Court, how-

ever, has previously approved an instruction similar to the one

given in this case. See Turf Center, Inc. v. United States, 325 ¥'.2d

793, 797 and n. 5 (9 Cir. 1963). Moreover, to the extent that

Stagman requires proof that an accused under §1952 intended to

violate state law himself, we find that it conflicts with the clear

meaning of the language used in §1952. As the court in Stagman

recognized, the intent required in the statute “refers to the entire

phrase ‘to * * * carry on * * * any unlawfal activity.’” 446 F.2d

at 492. That phrase does not require spccifie intent to facilitate an

activity which the accused knew to be unlawful under state law.

This interpretation, apart .com its inecrsistency with the literal

terms of §1952, also supports the poses of that statute in attack-

ing organized crime by furnishing federal help to local authorities

in their attempts to control wach crime. It would not subject inno-

cent persons to criminal jeopardy in travelling interstate since for

a conviction, proof would be required at the least “that the defend-

ant intended with bad purpose’”™ to facilitate the violation of state

law.

Although the instructions on specific intent, viewed alone, could

under state law.

E. Advice of Counsel

As an adjunct to their argument on specific intent, appellants

claim that the court should have instructed the jury that reliance

on advice of counsel could show a lack of specific intent. Given the

29[T)t is not necessary that the Government prove that the defendants

knew that they were violating Nevada law. The specific intent which the

intent to facilitate the carrying on of a

of

business enterprise involving gambling in violation of Nevada law.” Re-

porter’s Transcript, Vol. 43, p. 8802. See also pages 8755-8757.

99446 F.2d at 494.

7

—

a. oo !

Michael Santo Polizzi, et al. 17

evidence in this case, the advice given by counsel was an insignifi-

cant factor in the criminal enterprise found by the jury; thus the

court below did not err in, refusing to give an “advice of counsel”

instruction. See United States v. Shewfclt, 455 F.2d 836, 838-839

(9 Cir. 1972), cert. denied, 406 U.S. 944 (1972); Bisno v. United

States, 299 F.2d 711, 719-720 (9 Cir. 1961), cert. denied, 370 U.S.

952 (1962).

F. Kottcakos Instruction

Appellants contend that they were entitled to a “multiple con-

spiracy” instruction following the principle of Kotteakos v. United

States, 328 U.S. 750, 767-768 (1946). See also United States v.

Griffin, 464 F.2d 1352, 1355-1357 (9 Cir. 1972), cert. denied, 409

U.S. 1009 (1972). Having carefully reviewed the entire reporter's

transcript of trial and all documents in evidence, we find that there

is no variance between the allegations of the indictment and infor-

mation and the evidence presented at trial and that therefore the

trial court did not err in not giving a “multiple conspiracy”

instruction.

G. Suppression of Evidence

A letter from appellant Bellanca to Emprise Corporation was

not produced by the defense in response to a grand jury subpoena

because of a claim of attorney-client privilege. The court gave a

general instruction on suppression of evidence, apparently in part

on the basis that failure to produce the letter could be evidence of

suppression.21 Appellants also complain of the court’s refusal to

give an instruction on attorney-client privilege.

Even if the giving of the suppression of evidence instruction

were error, we find that the weight of other evidence against appel-

lants is such that the error could not have been prejudicial. The

court below, moreover, had instructed the jury on the attorney-

client privilege during the trial.*? é,

31See Reporter’s Transcript, Vol. 35, pp. 6944-6948.

32The issue of attorney-client privilege arose during the testimony of

Virgil Wedge. The court instructed the jury that: “There exists what is

known as an attorney-client privilege and it says, in short substance, that

shen & man goes to a lawyer and tells him sometimes confidential matters

— A-18 —

18 United States of America vs.

H. Perjurer’s Testimony

Appellants also claim error in the court’s failure to give a cau-

tionary instruction on the testimony of a perjurer. Their initial

proposed instruction referred to the witness, Maurice Friedman, as

an admitted perjurer when in fact he had been convicted of per-

jury and had not pled guilty. Appellants submitted a revised in-

struction after the instructions conference substituting “convicted”

for “admitted”, but it was rejected as untimely. Even if this were

error, which we do not find, any prejudice resulting from it was

cured by the instructions given on prior inconsistent statements**

and on the weight of the testimony of an informer.** These instruc-

tions sufficiently alerted the jury to the caution necessary in weigh-

ing the testimony of a witness like Friedman. Cf. United States v.

Evanchik, 413 F.2d 950, 954 (2 Cir. 1969); United States v. Ross,

322 F.2d 306, 307 (4 Cir. 1963), cert. denied, 375 U.S. 970 (1964).

I. Skimming**

Appellants argue that the trial court committed error in not ad-

monishing the jury during instructions that the prosecution’s argu-

ment about “skimming” should be disregarded as unsupported by

evidence and as not appearing in the indictment or information.

Whatever prejudice to appellants could have resulted from the

prosecutor’s argument was cured by the trial court’s painstaking

‘ instructions on the elements of the offenses charged. The trial judge

that he would want to discuss with a professional man, that that lawyer

has the duty of preserving those matters inviolate to publie notice and to

keep them confidential as long as his client wants him to do so.” Report-

or’s Transcript, Vol. 13, p. 2511.

33“The testimony of a witness may be diseredited or impeached by

showing that he previously made statements which are’inconsistent with

his previous testimony.” Reporter’s Transcript, Vol. 43, p. 8749.

nied Ot oe oe eee Oe er ae

vantage or vindication, must be examined and weighed by the jury with

greater care than the testimony of an ordinary witness. The jury must

determine whether the informer’s testimony has been affected by interest,

oN a ee eee Reporter’s Transcript,

Vol. 43, p. 8751.

3“Skimming” appears ts mend mleppeenstetien of Casino funds

Gicsiats teitadion Gf onivente ter enbintinedlitds in Gaile Grabs alo

the cashier's office and by unrecorded payments from the cashier's office.

SEL ERO — ce Ty

r 2 ANAS eke >

— <a

Michael Santo Polizzi, et al. 19

read the language of the information and indictment to the jury

and sent copies of them to the jury room. The jury was fully ap-

prised of the charges against appellants; “skimming” was not one

of them.

IV. Prejudicial Publicity

Appellants claim that they were prejudiced by the publicity

given their case both before and during trial and that the trial

judge failed to take adequate measures to detect and prevent that

prejudice. The pretrial publicity consisted mainly of newspaper

articles ou the case.** These articles commented, for instance, upon

the alleged ties of appellants to the Mafia and upon the “skimming”

allegations of the prosecution.

Appellants also point to several incidents during trial which in

their view also led to prejudicial publicity. Newspaper articles

referred, for example, to evidence which had not been admitted

linking appellants Zerilli and Polizzi to James Hoffa, the former

Teamster official, in a prior attempt to invest in a Las Vegas casino.

On another occasion a witness mentioned in the absence of the jury

that during a previous recorded and transcribed conversation, he

“had in mind” Zerilli and Polizzi when he used the terms “Mafia”

and “Cosa Nostra.” References to this comment appeared in the

newspapers. Later a newspaper disclosed the court’s ruling at a

sidebar conference sustaining the prosecutor's objection to a ques-

tion asking Polizzi to explain his testimony on cross-examination

that he had been falsely accused by the Department of Justice of

being in the Mafia.** The prosecutor had mentioned at that sidebar

conference surveillance }ogs of Zerilli and Polizzi disclosing “the

whole Mafia organization in Detroit,” and the newspaper article

referred to that comment. The motion picture The Godfather was

released during the trial, and a local television personality dis-

cussed during his program the b.--k and Zerilli and Polizzi and

their alleged links to the Mafia. Fiually, after the jury had reached

3¢Appellants also cite the book, The Godfather, as a factor, since its

storyline includes the infiltration of Las Vegas gambling by Mafia figures.

87The newspaper apparently learned of the ruling when a reporter,

without the government's authorization or knowledge, read its copy of the

reporter’s daily transcript in which the conference outside the presence of

the jury was reported. Thereafter the government took aciion to prevent

recurrence of such an event.

Do SI VS

— A-20 —

20 United States of America vs.

its verdicts, one juror allegedly told defense counsel that other

jurors had read newspaper articles on the case during trial and

that this had been “devastating to the defendants.” Although this

juror had been in the courtroom during a hearing on a motion for

a new trial, the court refused appellants’ request to have him tes-

tify but permitted defense counsel to file affidavits. The juror was

subsequently unwilling to submit an affidavit, but defense counsel

did file an affidavit purporting to state what the juror had said.

An accused has an unquestioned right to have jurors decide his

guilt or innocence who are not biased by what has appeared in the

media. In some instances prejudicial publicity before and during

trial may be so obvious and overwhelming that an appellate court

must overturn a conviction without delving into a detailed analysis

of the possibility of prejudice and the judicial action taken to curh

it. See Sheppard v. Maxwell, 384 U.S. 333, 349-352 (1966); Estes

v. Texas, 381 U.S. 532, 542, 544 (1965); Rideau v. Louisiana, 373

U.S. 723, 726 (1963); Irvin v. Dowd, 366 U.S. 717, 725 (1961).

After a review of appellants’ evidence and arguments on this ques-

tion, we do not find that the situation here reached that extreme,

and therefore we do not find “bias or preformed opinion” which

would require reversal as a matter of law. Beck v. Washington, 369

US. 541, 557 (1962); United States v. Silverthorne, 430 F.2d 675,

678 (9 Cir. 1970), cert. denied, 400 U.S. 1022 (1971). We must now

determine the probability of prejudice in this case and whether the

court responded adequately to curtail the chance of an unfair trial.

Marshall v. United States, 360 U.S. 310, 312 (1959).

A. Pretrial Publicity

“(T]he trial judge has a large discretion in ruling on the issue

of prejudice resulting from the reading by jurors of news articles

concerning the trial. * * ® [W]hen pretrial publicity is great, the

trial judge must exercise correspondingly great care in all aspects

of the case relating to publicity which might tend to defeat or

impair the rights of an accused. The judge must insure that the

voir dire examination of the jurors affords a fair determination

that no prejudice has been fostered.” Silverthorne v. United States,

400 F.2d 627, 637-638 (9 Cir. 1968). In a case of substantial pre-

trial publicity, the voir dire must not simply call for the jurors’

subjective assessment of their own impartiality, and it must not be

SS a = af

— A-21 —

Michael Santo Polizzi, et al. 21

so general that it docs not adequately probe the possibility of preju-

dice. 400 F.2d at 638.

If this case were to be considered closely similar to Siiverthorne,

supra, in the seriousness of the question of prejudice from pretrial

publicity, there is little doubt that the initial voir dire was not suffi-

ciently probing to meet the Silverthorne standards. The trial

judge’s questions on pretrial publicity were limited to two ques-

tions addressed to the first prospective panel of jurors** and later

questions addressed to an individual prospective juror.*® The an-

swers gave no indication of possible prejudice.

We find, however, that the pretrial publicity in this case was not

substantial enough to have required the trial judge to interrogate

the prospective jurors at length about it. The judge was aware of

the publicity, and clearly it was his judgment that the pretrial

publicity was not a significant danger to a fair trial.4° His concern

38“The Court: Have any of you heard anything about the facts of

this case except what yon have beard in this courtroom today?

« ive Jurors; No.

“The Court: I take it when you say you haven’t heard of it that

means you haven’t read anything about it either. Is that correct?

“Prospective Jurors: That’s right.” Reporter’s Transcript of Proceed-

ings of February 15, 1972, p. J-87.

3®The Court: Have you heard anything about this case in the news-

paper or radio?

“Prospective Juror Schadick: No.

“The Court: If you are a juror and you do hear something about it

will you put aside whatever news that should attract your attention as

quickly as you could without consuming it?

“Prospective Juror Schadick : Yes.” Reporter's Transcript of Pro-

ceedings of February 15, 1972, pp. J-126—J-127.

40A trial judge in a noteworthy and controversial case cannot be ex-

pected to impanel jurors who have not heard about the case. “In these

days of swift, widespread and diverse methods of communication, an im-

portant case can be expected to arouse the interest of the public in the

vicinity, and scareely any of those best qualified to serve as jurors will

not have formed some impression or opinion as to the merits of the case.

¢ © © To hold that the mere existence of any preconceived notion as to

the guilt or innocence of an accused, without more, is sufficient to rebut

the presumption of a prospective juror’s impartiality would be to estab-

lish an impossible standard. It is sufficient if the juror can lay aside his

impression or opinion and render a verdict based on the evidence pre-

sented in court.” Irvin v. Dowd, 366 U.S. 717, 722-723 (1961).

— A-22 —

22 United States of America vs.

seemed greater about the possible effects of publicity during trial.

The pretrial publicity in this case does not resemble the situation

in Silverthorne v. United States, 400 F.2d 627, 639 (1968). Unless

a trial judge clearly has erred in his estimation of the action needed

to uncover and prevent prejudice from pretrial publicity, an appel-

late court should not intervene and impose its estimate. The court

closest. to the situation can best evaluate the proper way to walk

the difficult line between a vigorous voir dire to determine any

possible bias and avoidance of creating bias by specific questions

which add “fuel to the fiames” in suggesting the presence of con-

troversial issues. Beck v. Washington, 369 U.S. 541, 548 (1962).

The court below did not abuse its discretion by the way it handled

the question of pretrial publicity.

B. Publicity During Trial

When the possibility of prejudice from publicity aris during

trial. the trial court has “the affirmative duty * * * te take positive

action to ascertain the existence of impreper influences on the

jurors’ deliberative qualifications and to take whatever steps are

necessary to diminish or eradicate such improprieties.” Silverthorne

v. United States, 400 F.2d 627, 643 (9 Cir. 1968). See also Gordon

v. United States, 438 F.2d 858, 872-873 (5 Cir. 1971), cert. denied,

404 U.S. 828 (1971), rehearing denied, 404 U.S. 960 (1971). The

better practice, if there is a clear chance of prejudice, is for the

court to interrogate each juror in camera about the possibly preju-

dicial publicity. Silverthorne v. United States, 400 F.2d 627, 644

(9 Cir. 1968) ; Coppedge v. United States, 272 F.2d 504, 508 (D.C.

Cir. 1959). The trial judge carries a difficult burden. He is called

upon to question the jurors, but repeated questioning could itself

be prejudicial in inciting in the jurors “joint or individual curios-

ity and encourage attempts to read the very newspaper articles

sought to be kept from their knowledge.” Silverthorne v. United

States, 400 F.2d 627, 643 (9 Cir. 1968). His very questions may

disclose or accentuate controversial issues. Unless he has clearly

abused his diseretion, we shall uphold the trial judge’s delicate

estimation of the needs of the case of which he has firsthand experi-

ence.

During his initial voir dire of prospective jurors, the judge indi-

cated that the jurors would not. be sequestered but that they would

— A-23 —

Michael Santo Polizzi, et al. 23

be expected to avoid hearing or seeing anything about the case.*?

One prospective juror was questioned about adherence to that ad-

monition; she indicated that she would find it difficult to follow

and was excused. Appellants argue that allowing the jurors to read

newspapers with the admonition to avoid stories on the trial after

that may come to you through newspapers or through other media about

this case, you understand that there is a reason for my doing so?

“Prospective Jurors: Yes.” Reporter’s Transcript of Proceedings of

42Cases cited by appellants are readily distinguishable from this case.

charges

defendants”. In United States v. Thomas, 463 F.2d 1061, 1062-1063 (7

Cir. 1972), juror disclosed that certain jurors had “argued from” a

newspaper article which they displayed during their deliberations and

that several votes were required before al] jurors decided to vote for con-

— A-24 —

24 United States of America vs.

Early in the trial on February 24, 1972, the court again

admonished the jury to avoid any publicity about the case.** The

very next day, after newspaper stories linking Zerilli and Polizzi

to James Hoffa, the court undertook an in camera interrogation

of each juror separately, in the absence of all defendants, counsel

and other jurors. The judge asked whether they had read the

the articles and whether they had seen or heard anything about

the case in the newspapers, on television, or on the radio. He

also gave them another general admonition. Nothing said by any

of the jurors during this interrogation revealed a possibility of

prejudice from the publicity.44 We agree with appellants that it

43“May I remind the jury once again about the earlier admonition

about reading any publicity that may be in the newspapers about this

case, or watebing any news concerning this case on TV or raazio. Please

be mindful of the importance of the admonition that I have told you

about concerning that.” Reporter’s Transcript, Vol. 6, p. 1319.

44The court gave a fair and complete report of the interrogation tw

the parties and counsel :

“Qne juror indicated that several days ago he heard on the Long Beach

radio station that a jury had beea selected in this case, but that he had

heard nothing else on radio. A‘i the other jurors indicated that they had

heard nothing on radio or on TV about the case.

“Mr. Dewey said that he saw the Los Angeles Times in the jury room

this morning, but as soon as he saw it be pushed it aside and did not read

the paper at all.

“Mr. Ford stated that he had not read either of the articles, but that

four or five days ago he saw an article in the paper saying that a jury

had been selected in the case.

“Mr. Foss said that he saw the headline in last night’s Herald Exam-

iner, but that he did not read the article, and that he did not read the

article in the Times.

“Each of the other jurors indicated that he or she had not read either

of the articles and had heard nothing on radio or TV. This inquiry in-

cludes the alternates.

“J admonished each against reading any future articles and received

the promise of each that he would not read any newspaper articles about

this case or listen to any account of it on radio or TV.

“Each person was asked if anything had happened to this point to

prejudice him or her against any defendant, and each indicated that

nothing had.

“J see no reason at this point to declare a mistrial, but if any counsel

desires to be orally heard on such a motion I will hear it at a later time

in the day.” Reporter’s Transcript, Vol. 7, pp. 1348-1349.

LO LOD IG rer,

wT Gebel HE

—

—_ SBS

Michael Santo Polizzi, et al. 25

would have been preferable to ask each juror about the news-

paper carrying the Hoffa story which apparently was in the jury

room, but each juror’s other answers would have to be willful

falschoods if each had in fact read the article in the jury room.

If the jurors had read the story, “fe]ven the most biased argu-

ment would be hard put to suggest that all twelve jurors, sworn

to try the indictments fairly would deliberately break their oaths

by remaining in the box, having read the items, instead of bow-

ing out under the wise protection of the court and saving not

only their dignity but their honor.” United States v. Carlucct,

288 F.2d 691, 696 (3 Cir. 1961), cert. denied, 366 U.S. 961

(1961).

On March 9, 1972, after newspaper articles were published

referring to appellants and their links to organized crime as dis-

covered by United States Senate investigators, the court declined

to question the jurors again, in the belief that new questioning

could itself undermine the jury’s belief in its own integrity.*®

On March 21, 1972, after the leak of the ruling at the sidebar

conference, the court, having the opportunity to observe on @

daily basis the demeanor of the jurors and after expressing his

confidence in their ability to obey his admonitions, again declined

to interrogate the jurors anew.*®

On April 3, 1972, the trial court on its own motion conducted

an in camera questioning of each juror.‘7 Again defendants, coun-

sel, and the other jurors were not present. He asked them gener-

ally whether they had read, seen, or heard anything in the media

about the case. The jurors indicated that they had not. Appel-

45“Now wouldn’t you think that if you were on this jury and every see-

ond day I eame to you and said, now you are not reading any newspapers,

are you, wouldn’t you think that I had little enough trust in the integrity

of these jurors?” Reporter's Transcript, Vol. 16, p. 3152.

4¢“[M]y concern is with this jury and my coneczu is that your clients

and the Government will get a fair trial in this case, and I have gone to

the efforts that you have just described to admonish the jury time and

again and to talk with them individually about their responsibility not

to read the newspapers or any accounts of this trial from the newspapers,

and I have reason to believe that they are going to obey that admonition

because I have impressed upon them the importance of doing so.” Re-

porter’s Transcript, Vol. 24, p. 4711. 7

47Reporter’s Transcript, Vl, 31, pp. 6008-6024.

—e

United States of America vs.

gba 2

Far

HT

i?

before you read it?

“Juror Foss: I won’t read anything about the case.

“The Court: That is fine.

I will decide it on the facts in the court

room.” Reporter’s Transcript, Vol. 31, pp. 6010-6011.

“Juror Foss:

The argument is frivolous.

After the verdicts were reached, the trial judge questioned each

juror separately in his chambers. He stressed on this occasion

whether the term “Mafia” or related terms had been factors in

the jury’s deliberations. ** It seems that the terms were discussed

‘*The court's questions and each juror’s response relating to the

“Mafia” issuc were as follows:

iL

He

int

a

noe

id

i}

tees

it iti

i

esl

drs Bet it et os

— <a

MichaelSanto Polizzi, et al. 27

briefly at the beginning ofthe jury’s deliberations and once dur-

ing a lunchtime, but the jwors agreed that those terms and issues

had not been factors in their decisions. The judge also asked

“Juror Déwey: No, ) think it was just an informal thing, that

we just said, we are goingto go by the evidence and forget the state-

ments that were made tha! didn’t have any bearing on the case.

“The Court: And tht would have included any reference to

Mafia or Cosa Nostra?

“Jaror Dewey: I dont think we got down and said the words,

just to the effect that we vill stick to the evidence and that was all.”

* ee @ *- e«

“The Court: De you mow that any mention during the trial of

the words ‘Mafia’ or any Plated term had any effect upon the verdicts

that were reached?

“Juror Ford: No, I on’t think that that influenced anybody. I

a lot of times thee people just think it is really fictional to

a great degree, they thin! it is a bogeyman word and that it is not

anything real, that it is eaggerated.

“The Court: Mr. Devey tells me that at the outset during the

there was ome informal talk about whether any of

terms have influened anybody or brought any trouble to this

trial, and he seems to sy that there was some general discussion

about it so that you couldkind of clear the decks on that right away,

is that true?

“Juror Ford: Yes. ‘hey had, you know, some of them didn’t

even know what the termmeant, what it was all about, some weren’t

familiar with it, some bid heard of it but only in something that

they had seen or beard.”

5

a

“The Court: I am tdd that there was some discussion at the

in the jury room ly the jurors about these terms ‘Mafia’ and

and that pu decided you were just going to have a

gt it out of the way.

"t hink that that had anything to do with the

“The Court: There wis the question I was going to ask, whether

you think that any of thee terms inflamed the jury members in any

itil

Ta

[For the entire transeipt of the interrogation of Juror Palmer,

see footnote 50, infra.)

«se &©& @&@ @

“The Court: Do youthink any mention of the words ‘Mafia’ or

related terms had any infuence at all on any of <hese jurors?

— A-28 —

United States of America vs.

28

them about their exposure to the book and the motion picture

The Godfather. Two jurors had read the book, but said that it

“The Court: Do you think that any discussion of that word ad-

versely affected any of these defendants?

“Juror Daniels: No, your Honor, because we didn’t even during

the time of our deliberations, we never did, even the word ‘Mafia’

was not even entertained or brought forth.”

s 7 . + .

“Juror Mirick: * * * [W]e threw out when we first went in there

any talk of Mafia * * *°.

“The Court: * * * Now do you think that the use of these words

‘Mafia’ and related words at all influenced any of these jurors?

“Juror Mirick: No, I am sure not.”

* ee . we

“The Court: The word ‘Mafia’ and related terms were bandied

about a little bit during the time of the trial. Do yon think that that

inflamed the jury in any way?

“Juror Hoeffler: No.

“The Court: Do you think that it had any adverse effect at all on

any of these defendants?

“Juror Hoeffler: Would you say that again?

“The Court: Do you think that the use of that term ‘Mafia’ and

so forth had any adverse effect on these defendants? Did any of

you use it, we will say, against any of these defendants or use it in

reaching your verdicts?

“Juror Hoeffler: No, sir.”

7 . . + +o

“The Court: Now what about during the deliberations, during

the course of the trial the word ‘Mafia’ came up and related terms

to that also. Do you think that any mention of that had any adverse

effect upon any of these defendants?

“Juror Stroops: No, sir. I don’t think we—I know we didn’t pay

any attention. I think it was just in one thing, it was in Mr. Fried-

man’s just one time, I think in his testimony it was just one time

we seen it in the testimony. * * *”

'

— A-29 —

Michael Santo Polizzi, et al. 29

had not influenced their decisions. He asked all but four jurors

general questions about their exposure to newspaper, television,

and radio publicity, again without any revelations of possible

prejudice.

Finally, on June 12, 197%, at a hearing on a motion for a new

trial, defense counsel told the court of juror Palmer’s revelation

that other jurors had been reading newspaper stories about the

case and that it had been “devastating to the defendants.” The

court refused defense counsel’s request for an immediate examina-

tion of jurors Palmer and Dewey who were in the courtroom,

but stated that counsel could file affidavits on the matter. Palmer

subsequently refused to submit an affidavit although defense

counsel did submit two affidavits.*® While it may generally be

“Juror Montejano: No, your Honor. I think if anything it might

have helped us to even try to be really applying ourselves and

go by the facts.

“The Court: Now some have said that at the outset of your

liberations that there was some discussion of the effect of these terms,

‘Mafia,’ and so forth in the jury room, and you decided to clear the

decks concerning it in that manner.

“Juror Montejano: That § is Fight.”

.

“The Court: ho seb Odi Geb he entice Maes he en

the word ‘Mafia’ or any related such term did it have any adverse

influence upon any member of this jury to your knowledge against

any of these defendants?

“Juror McDonald: No, sir, absolutely not.”

7 a. * o

- &

“The Court: There was a mention during the trial of the word

‘Mafia’ and some related terms. Do you think that anybody on this

jury related any of these terms to any of these defendants?

“Juror Plant: No, sir.

“The Court: Did it in your opinion have any effect at all in the

verdicts that were reached?

“Juror Plant: No, sir.”

Reporter’s Transcript, Vol. 46, pp. 8997-8998, 9000-9001, 9003,

9009, 9011, 9013, 9015, 9018, 9020, 9023, 9026.

4®Counsel for appellant Zerilli submitted the following affidavit, dated

i June 16, 1972:

“William J. Weinstein, being first duly sworn, deposes and says:

“On June 12, 1972, prior to the commencement of the court pro-

ceedings in the morning on the motions for new trial, I saw Alfred

a Seward

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Michael Santo Polizzi, et al. 31

Palmer’s disclosure as reported by defense counsel unworthy of

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“I owe you an apology for being the black sheep, the only one that

said yes when I should have said no.

“The Court: No apology needed at all.

“Juror Palmer: The count was seven to five and I still feel that

if we had had another session we could have come out on it. [This

reference is to the jury’s failure to reach a verdict as to defendant

Polizzi on Count 3 of the indictment. See p. 8987.)

“The Court: My purpose here now is to ask you some questions

about the case. Do you think that anything happened outside of

this courtroom during the trial of this case that in any way influenced

the verdict in the case?

“Juror Palmer: Well, I will put it this way, not that I know of.

As far as myself is concerned, no, but 2s to others I am not too sure.

“The Court: Yes, Now is there anything about that, that leads

you to suspect that anything happened?

“Juror Palmer: Well, I would rather hesitatingly say no.

“The Court: Read that answer to me.

“(Record read.)

“Juror Palmer: I think you well know in your experience that

when folks get together outside, going to lunch or something like

that, you can’t very well stop them from talking about it among

themselves, you know what I mean, just among ourselves, and I

think some of that was done but I don’t want to accuse anybody of it.

“The Court: Yes. Ali right. Now do you think that anybody

reached any decisions about the case before ihe case was turned over

to the jury?

“Juror Palmer: I don’t think so. None were expressed to me,

no, sir.

“The Court: Mr. Palmer, there is a picture called The Godfather.

Have you seen that picture?

“Juror Palmer: No, sir, I have not.

“The Court: Have you read the book by the same name?

“Juror Palmer: No, sir. In fact, I never heard of it until you

mentioned it.

“The Court: Was there any discussion of either the picture or

the book in that jury room?

“Juror Palmer: No, sir, not that I know of, not that I heard.

“The Court: Do you think that tse mention during this trial of

any of the terms such as ‘Mafia’ o: related terms had any unfavor-

able influence on the verdicts that were reached?

“Juror Palmer: Well, to be frank and honest with you, I hope

I won’t get into trouble by «doing so, I think some of that was men-

tioned during the lunch hour between some of the members of the

jury.

“The Court: In what respect?

— A-32 —

32 | United States of America vs.

belief. Palmer’s unwillingness to submit an affidavit strongly sup-

ports that judgment.*!

“Juror Palmer: Well, it was just the fact that it came up during

the , the Chief of Police of Detroit accused some of our defend-

ants of being members of it, they threatened him with suit and the

suit was never filed because they thought they couldn’t win it, the

defendants I mean. Do I make myself clear?

“The Court: Yes, I think so. What you are saying is that during

a lunch hour that there was some discussion of the evidence, is that

correct ?

“Juror Palmer: I was told somewhere that that come out in the

local papers during the trial, and I think that was discussed during

the lunch hour between some of the members. I don’t want to hold

“Juror Palmer: I don’t believe so, no, sir.

“The Court: Any comment or any discussion about it in the de-

“Juror Palmer: No, sir, nothing. I never heard the word men-

“The Court: All right. I think those are the questions that I

wanted to ask you. And thank you again.

“Juror Palmer: Let me say it has been a pleasure to work with

you. I hope I get a chance to do it again.

“The Court: It has been a pleasure working with you.

“Juror Palmer: Thank you.”

vote

argued from [a newspsper] article which they displayed and to

they repeatedly referred.” Here Palmer's disclosure as reported by uppel-

lants’ counsel came approximately six weeks after the verdict had been

reached, and there were good reasons for disbelieving that disclosure.

ON ee ey

— A-33 —

Michael Santo Polizzi, et al. 33

In this case the problem of publicity was not insignificant,

but it was a problem that was handled by proper judicial super-

vision. “The right to publish a prejudicial article does not carry

with it the right of an accused to an automatic mistrial. Such

an outeome would give to the press a power over judicial pro-

ceedings which may not be countenanced.” Mares v. United States,

383 F.2d 805, 808 (10 Cir. 1967), cert. denied, 394 US. 963

(1969). After our detailed review, we cannot say that there is

a serious possibility that the jury was influenced by considera-

tions apart from evidence properly admitted at trial. The trial

judge admonished the jury on at least four occasions to avoid

publicity about the ease. He interrogated the jurors individually

three times. The fact that the jurors discussed the term “Mafia”

and related issues does not in itself require reversal. Cf. United

States v. Lazarus, 425 F.2d 638, 640-641 (9 Cir. 1970), cert.

denied, 400 US. 869 (1970), rehearing denied, 400 US. 954

(1970). For appellants’ arguments of prejudice and juror

Palmer’s disclosure to be true, the other jurors wou'd in effect

have committed perjury on several occasions and have entered

into a conspiracy of silence. The trial judge found that incredible.

We agree. “Appellate courts should be slow to impute to juries

a disregard of their duties, and to trial courts a want of diligence

or perspicacity in appraising the jury's conduct.” Fairmount

Glass Works v. Cub Fork Coc! Co., 287 US. 474, 485 (1933)

(Brandeis, J.). “If the mere opportunity for prejudice or cor-

ruption is to raise a presumption that they exist, it will be hard

to maintain jury trial under the conditions of the present day.”

Holt v. United States, 218 U.S. 245, 251 (1910) (Holn:es, J.).

No reversible error was committed in the trial court’s handling

of the question-of prejudicial publicity; we do not find “that

the probability of prejudice arose and was not eliminated.” Su

verthorne v. United States, 400 F.2d 627, 644 (9 Cir. 1968).

V. Department of Justice “Mafia” List

The United States Department of Justice in 1969 included

appellants Zerilli and Polizzi on a list of known Mafia figures.

See 115 Cong.Rec., Part 17, pp. 23440-23441 (August 12, 1969).

Appellants contend that the presence of those names on that

list was the motivating factor in the prosecution of this case and

dinate

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34 United States of America vs.

also that the prosecution made several prejudicial comments,

based upon appellants’ alleged Mafia connections, to the grand

and petit juries.

Their first point, that their inclusion on the “Mafia list” was

the prime motivation for the prosecution, is not supported by

anything in the record and is strongly contradicted by the testi-

mony of three government officials prominent in this prosecu-

tion.5?

The next contention, that the prosecution “poisoned” the grand

jury proceedings by comments referring to the Mafia, is un-

supported by the record or by the authorities appellants cite.

The portions of the transcript of the proceedings before the

grand jury which appellants quote in their opening brief are not

evidence of grand jury bias. “Mafia” is mentioned by the prose-

cutor in one question. The possible use of force is the basis of

four questions referring to appellant Shapiro. One witness is

asked whether he is fearful or apprehensive as a result of his

testimony. Appellants allege that the grand jury was “repeatedly

told” of a prior arrest of appellant Zerilii; and the prosecutor

commented on the alleged association of Zerilli and Polizzi with

“tough guys, Italians, from New York.”

Appellants have a difficult burden to satisfy in their chal-

lenge to the indictment. “An indictment returned by 2 legally

52The Honorable W. Matthew Byrne, Jr., United States District Judge,

and who was United States Attorney in Los Angeles during the initial

stages of this case, testified that interviews with Maurice Friedman were -

“the basis for the commencement of the investigation and the commence-

ment of grand jury investigation regarding the Frontier case.” Reporter’s

Transcript, Vol. 48, p. 9224. He did not recall having ever seen the

“Mafia list.” Reporter’s Transcript, Vol. 51, pp. 9824-9825. David Nissen,

chief of special prosecutions in the organized crime and racketeering sec-

tion of the United States Attorney’s office in Los Angeles at the time,

also testified that Friedman’s information was the basis for the decision

to convene a grand jury. Reporter’s Transcript, Vol. 51, p. 10,031. He

denied that the “Mafia list” played any role in developing his interest in

beginning the prosecution. Reporter’s Transcript, Vol. 52, p. 10,220.

Wayne W. Hill, a special agent with the F.B.I., also testified that the

Friedman interviews provided the basis for initiating the prosecution.

Reporter’s Transcript, Vol. 49, pp. 9412-9418. He too denied ever having

seen the “Mafia list.” Reporter’s Transcript, Vol. 50, p. 9714.

eta tH

-A-35 ~

Michac! Santo Polizzi, ef al. 35

constituted and unbiased grand jury, like an information drawn

by the prosecutor, if valid on its face, is enough to call for trial

ot the charge on the merits. The Fifth Amendment requires

nothing more.” Costello v. United States, 350 U.S. 359, 363

(1958). A valid indictment does not require support by

“adequate or competent evidence” 350 U.S. at 364.5% See also

United States v. Calandra, US.. (1974). Appellants have

not demonstrated a reasonable inference of bias on the part

of the grand jury resulting trom the comments of the prosecu-

tor.44 See Beck v. Washington, 369 U.S. 541, 545-549 (1962).

“The quantum of evidence necessary to indict is not as great

as that necessary to convict. If a grand jury is prejudiced by

outside sources when in fact there is insufficient evidence to

indict, the greatest safeguard to the liberty of the accused is the

petit jury and the rules governing its determination of a de-

fendant’s guilt or innocence. And, if impartiality among the

petit jurors is wanting, the cure is reversal by the appellate

courts.” Silverthorne v. United States, 400 F.2d 627, 634 (9 Cir.

1968 ) .55

Appellants also argue that the “Mafia list” played an im-

permissible role in the trial. They refer, however, only to the

comments of the prosecutor in closing argument that appellants

“substituted the corporate resolution for the pistol.”5* Although it

53The recent decision cited by appellants, United States v. Estepa, 404

F.2d 1132, 1137 (2 Cir. 1972), condemns the needless use 0 hearsay testi-

mony before the grand jury and is irrelevant to appellants’ claims.

54References to “Mafia” and “Italians” are certainly not per se preju-

dicial. Cf. United States v. Lazarus, 425 F.2d 638, 640-641 (9 Cir. 1970),

cert. denied, 400 U.S. 869 (1970), rehearing denied, 400 U.S. 954 (1970).

55Those cases upon which appellants rely concerned prosecutor miscon-

duct in arguments to the petit jury. Berger v. United States, 295 U.S. 78

(1935) ; United States v. Cummings, 468 F.2d 274, 277-278 (9 Cir. 1972);

Hall v. United States, 419 F.2d 582 (5 Cir. 1969). This distinction does

not justify, of course, prosecutor misconduct before the grand jury. See

A.B.A. Standards Relating to the Prosecution Function, Approved Draft,

1971, §3.5(b). It does mean that it takes very substantial evidence of

grand jury bias for an appellate court to reverse a conviction because of

an indictment returned by an allegedly biased grand jury.

66“J think I told you at the outset that this is nothing more than

sophisticated robbery, sophisticated theft. And these businessmen have

LS PKA RN TA

— A-36 —

36 United States of America vs.

is unclear that these comments were related to the “Mafia list”

in any event appellants have failed to demonstrate that the

comments contributed to an unfair trial. The trial judge spe-

cifically inquired of each juror in camera in a post-verdict voir

dire as to the influence on the jurors of terms such as “Mafia,”

with no indication that they had influenced the verdicts.57

VI. Cross-Examination on Reputation

Appellants argue that the trial court committed reversible

error in allowing the prosecution to cross-examine Polizzi and

Zerilli on their reputations. The government contends that the

cross-examination was permissible as to Polizzi because he had

opened the subject of his reputation on direct examination and

as to Zerilli in order to impeach his testimony about why he

could not be licensed.

“The price a defendant must pay for attempting to prove

his good name is to throw open the entire subject which the

law has kept closed for his benefit and to make himself vulner-

<ule where the law otherwise shields him.” Michelson v. United

States, 355 U.S. 469, 479 (1948). Throughout the presentation

of its case, the prosecution avoided raising the issue of the

Mafia links of Zerilli and Polizzi in demonstrating that they could

not themselves obtain licenses from the Nevada authorities. On

direct examination Polizzi testified that the reason why he could

not be licensed was that he had a “problem.” He never described

the specifics of this problem. These statements did not open the

question of Polizzi’s reputation for cross-examination. Appellants

could reasonably have understood that references to Mafia links

and reputation were to be avoided. The important point for the

prosecution was that Polizzi had serious problems preventing him

from obtaining a license and thus motivating him to acquire a

hidden interest; what the specifie problems were was not directly

learned it is better to use a corporate resolution than a pistol.” Report-

er’s Transcript, Vol. 43, p. 8683.

“In short * * * the principals have learned that a corporate resolution

is more deadly and more effective than a pistol, and the changes of ap-

prehension and proof are considerably more difficult.” Reporter’s Tran-

seript, Vol. 39, p. 7995.

57See pages 29-32, supra.

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Michael Santo Polizzi, et al. 37

relevant. The danger of prejudice certainly cstweighed whatever

slight probative value a more specific line of questioning may

have had.

The government attempts to justify its cross-examination of

Zerilli in terms of impeaching his testimony on the reasons why

he could not be licensed. His testimony, however, really concerned

what his attorney had told him were the reasons. Thus the

government’s impeachment was more directed at the attorney

than Zerilli, unless it could have been shown that Zerilli was

misrepresenting what the attorney had told him. With the pro-

bative value of the government’s questioning on Zerilli’s repu-

tation at best speculative, it was eror to permit the government

to begin a line of questioning with a high possibility of prejudice.

Though the court’s rulings were erroneous, appellants. were

not prejudiced by them. The court questioned the jurors in-

dividually in camera after they had reached their verdicts on

the influence of the Mafia issue and was satisfied that it had

not been a factor in their decisions. We have found that he did

not commit error in making that determination 5* and it pre-

eludes reverez! on this issue.

VII. Misconduct of the Prosecutor and Trial Judge

Appellants cite many episodes of what they assert to be mis-

conduct by the prosecutor, sanctioned by the trial judge, which

deprived them of a fair trial. After having carefully reviewed

each of these assertions, we do not find that they amount to a

deprivation of appellants’ right to a fair trial. No good would

be served by a discussion of each of the points raised, but we

shall diseuss several representative claims.5®

58See pages 29-32, supra.

58Those points not diseussed are appellants’ contentions that the prose-

eutor misstated facts and evidence thrsughout the trial; that the court

delayed too long in giving appellants’ counsel opportunities to argue their

objections to the prosecutor’s conduct; that the prosecutor was allowed to

argue law, and misrepresent the law, in his arguments to the jury; that

the prosecutor improperly asked witnesses to “square” their testimony

with that of other witnesses; that the prosecutor intentionally misrepre-

sented to the court what he expected the testimony of a witness would

be; that the exhibits were mishandled and that the jury may have had

in the jury room exhibits not admitted into evidence; that side-bar con-

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— A-38 —

38 United States of America rs.

In his closing arguments, the prosecutor did make comments

which could have conveyed the impression that appellants were

violent individuals.*° This question, however, is tied closely to the

issue of the influence of the Mafia references on the jury. We

have found that the court below carefully handled that issue,**

and we find that these comments were not so prejudicial to

appellants so as to require reversal of the jury’s verdicts.

Appellants argue that the prosecutor gave his personal opinion

of appellants’ guilt to the jury and referred to the indictment

in this case as supporting him. The prosecutor did mention the

grand jury indictment, but he used it to rebut appellants’ argu-

ment to the jury that the prosecutor was pursuing in effect a

personal vendetta against appellants.°*? The reference to the in-

ferences were audible to the jury mainly through the fault of the prose-

cutor; and that the trial judge changed certain “ground rules” to the

prejudice of appellants. We have, however, carefully considered each of

these points and, based upon our review of the entire record, find them

to be without merit.

60“That is the good old fashioned Chicago type extortion.” Reporter’s

Transcript, Vol. 39, p. 7983. This particular reference was to testimony

in the record which indicated perhaps some potential for violence during

the events in question in this case. See witness Friedman’s testimony of

his mysterious and rather frightening trip to Toledo, Ohio. Reporter’s

Transcript, Vol. 5, pp. 1084-1098. The comment was not proper, how-

ever. See also the comments qucted in footnote 56, supra.

®1See pages 29-32, supra.

*2Defense counsel had argued: “The thing that impressed me and

rather frightened me was the display of overwhelming power of the Fed-

eral Government if one of their prosecutors gets a theory and takes after

you.” Reporter’s Transcript, Vol. 42, p. 8391.

The prosecutor then argued: “* * * But Mr. Ball has made a state-

ment that I must make one remark to. He says he is worried because a

prosecutor gets you on a theory and a statate and he goes after you.

“Not true. Never has been true in the legal system in this country or

the body of criminal law that has only been around for 550 years. Never

has been true and it is not true during this trial.

“A grand jury passed on this indictment. Not Kotoske. When it is

read to you, the judge will read, ‘The Grand Jury charges’. Not Tom

Kotoske.” Reporter’s Transcript, Vol. 43, p. 8692.

Earlier in his argument, the prosecutor had also referred to the indict-

ment in trying to show that the government had been consistent in as-

serting a legal theory under §1952. See Reporter’s Transcript, Vol. 43,

p. 8680. é

—_— -

he BCRP be oh a

— A-39 —

Michael Santo Polizzi, et al. 39

dictment in these circumstances does not constitute improper

argument. Cf. United States v. Cummings, 468 F.2d 274, 277-278

(9 Cir. 1972); Hall v. United States, 419 F.2d 582, 587 (5 Cir.

1969). Moreover, the jury was instructed that the indictment and

information were not evidence and were merely methods of ac-

eusing a defendant of a crime. Reporter's Transcript, Vol. 43,

pp. 8736-8737.

On four occasions, in ruling on questions addressed to two

government witnesses, the trial judge made comments that appear

to vouch for the credibility of the witnesses. However, we cannot

accept the appellants’ assertions of prejudice. They did not object

to any of the judge’s statements, and they certainly knew how

to object when they thought it important to do so. The error,

if any, could easily have been corrected, had there been objection.

For example, in one instance, at the end of the colloquy, the

court said “* * * in any instance the jury is to draw no

inference from the questions as bringing any thruthfulness to us.”

Reporter’s Transcript, Vol. 2, p. 244. The court, moreover, in-

structed the jury not to assume from his comments during trial

that he held particular opinions about. the issues in question and

that they were the sole judges of the credibility of witnesses and

of the weight of evidence. See United States v. Jackson, 482

F.2d 1167, 1175-1176 (10 Cir. 1973); United States v. Cunning-

ham, 423 F.2d 1269, 1276 (4 Cir. 1970).

Appellants contend that the trial court first received evidence,

in the presence of the jury, on the question of the applicable

Nevada law, rendering the matter one for the jury’s decision,

but then at the end of the trial took the issue away from the

jury by instructing it as to the state law. The determination of

the applicable state law in a case such as this is a question for

the court. Cf. United States v. D’Amato, 436 F.2d 52, 54 (3

Cir. 1970); United States v. Lyon, 397 F.2d 505, 513 (7 Cir.

1968), cert. denied, 393 U.S. 846 (1968). To receive testimony on

the question of state law in the presence of the jury is un-

necessary, but not prejudicial error unless the combination of

the testimony and the court’s instructions clearly leave the jury

in confusion or in doubt as to the applicable state law. We do

not find prejudicial error here.

ee eT ee ey Bere |

—s a

40 United States of America vs.

Also cited as error is the trial court’s comment that a certain

question could be decided if one of the appellants took the

stand.*? This was not an infringement of appellant Bellanca’s

right against self-incrimination. “[T]he test is whether the

language used was manifestly intended or was of such character

that the jury woald naturally and necessarily take it to be a

comment on the failure of the accused to testify.” Knowles v.

United States, 224 F.2d 168, 170 (10 Cir. 1955).6* No such

finding could be reached here. It was an offhand comment which

could have had no influence on the jury. This point is an

example of a practice appellants have followed many times on

this appeal: quoting out of context remarks of the prosecutor

and especially the trial judge and supplying an “argument” for

reversal by dramatic and hyperbolic language. Appellants argue

that after this incident “appellant Bellanca had to take the stand

or suffer the possibility of an untoward inference by the jurors.”

The episode in fact was a pedestrian exchange which, if any-

thing, probably left the jury with the impression that appellants

would be able to establish the point through other witnesses,

including appellant Bellanca if he testified.

Appellants’ next point is that the prosecution evaded a prior

ruling by the court that it could not offer evidence of pricr

similar acts by appellants. The court, after hearing the proffered

evidence in the absence of the jury, instructed the jury that

there was no evidence of prior similar acts and that any com-

ments of the prosecutor on the issue were to be disregarded. In

addition, each juror was asked whether the comments had preju-

diced them, and each juror said that he had not been prejudiced.

63“The Court: I enderstand what you are trying to show, but I don’t

know how you can show it\by establishing—you are not able to establish

the foundation for this document by this witness, as I see it. You may

be able to establish it by some other witness, or if your brovher takes the

stand and testifies you can establish his whereabouts by his testimony.

“Mr. James Bellanca: Then I will withdraw it and save it until then,

your Honor.” Reporter’s Transcript, Vol. 9, p. 1678.

64See also United States v. Biondo, 483 F.2d 635, 644-645 (8 Cir.

1973); United States v. Mahanna, 461 F.2d 1110, 1113-1115 (8 Cir.

1972); United States v. Porter, 441 F.2d 1204, 1216 (8 Cir. 1971), cert.

denied, 404 U.S. 911 (1971); Davis v. United States, 357 F.2d 438, 440-

441 (5 Cir. 1966), cert. denied, 385 U.S. 927 (1966).

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— A-41 —

Michael Santo Polizzi, et al. 41

The prosecution nevertheless subsequently inquired on cross

examination abovt prior attempts to invest in Las Vegas. This

line of inquiry was permitted by the court for the limited

purpose of showing Zerilli and Polizzi’s earlier interest in invest-

ing in a Las Vegas casino. However, the probative value of that

testimony was not great enough to justify its admission in light

of the possibility of confusing the jury which in effect was

asked te consider the evidence on one issue but not on another,

although the issues of motive and prior similar acts, if not

identical, were closely related. We do not find, however, that

prejudice to appellants actually resulted in light of other and

substantial evidence supporting the verdicts.

The government attempted to use a deposition of Benjamin

Reisman, an attorney employed by appellant Emprise, on its

redirect examination of Maurice Friedman. The deposition was

taken in 1970, before appellants were indicted, during the course

of other legal proceedings. Appellant Rooks was later asked on

cross-examination by the prosecution whether ie had heard the

reading of the deposition and whether he knew of the events

described in the deposition. On cross-examination of appellant

Zerilli, the prosecutor used the deposition again in an attempt to

refresh Zerilli’s recollection.

The use of the deposition cannot be justified by Rule 15 of

the Federal Rules of Criminal Procedur= since it was not taken

at the motion of a defendant, it was taken before the indictment

and information here were filed, no order of the court had been

obtained, and no notice had been given to the parties. The

prosecution argues that it offered the evidence only as to the

corporate defendant Emprise. The deposition was taken in con-

nection with legal proceedings against Jeremy Jacobs, the Presi-

dent of Emprise. The court admitted it not on the authority of

Rule 15, but rather on the ground that it was a prior statement

of a witness in a case where the parties and issues were sub-

stantially the same as in the present case. We need not decide

whether there was error.*5 Another deposition of Reisman was

65We disagree with the government’s view that appellants’ objection to

admitting the deposition was withdrawn when it was agreed that another

Ceposition of Reisman would be taken. The court had made its ruling,

and defense counsel then asked about the possibility of taking another

deposition.

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— A-42 —

42 United States of America vs.

taken and read into the record without objection, thereby curing

any defect arising from the admission of the first deposition.

Appellants’ counsel had the opportunity to ask Reisman about

his prior statements, thus eaten: appellants’ right to confront

adverse witnesses.

If it were error to allow the prosecution to ask appellant

Rooks about the first Reisman deposition, there was no possible

prejudice.** The same is true of the use of the deposition as

possibly refreshing Zerilli’s memory; the incident was insignifi-

cant.*7

The prosecution, as the representative of the government, is

expected to follow high standards in conducting its case. “The

United States Attorney is the representative not of an ordinary

party to a controversy, but of a sovereignty whose obligation to

govern impartially is as compelling as its obligation to govern

at all; and whose interest, therefore, in a criminal prosecution

is not that it shall win a case, but that justice shall be done.”

Berger v. United States, 295 U.S. 78, 88 (1935). But during an

extensive and fiercely contested trial, we cannot realistically ex-

pect perfection. Cf. Lutwak v. United States, 344 U.S. 604,' 619

(1953). Upon hindsight, there were things said by the prosecution

which would have been better unsaid. But nothing said or done

deprived appellants of a fair trial.

66“Q) Did you hear the reading of the Ben Reisman deposition that

that happened in the spring?

“A No, I don’t recall hearing that.” Reporter’s Transcript, Vol. 24,

p. 4602.

67“Q Mr. Zerilli, does that refresh your recollection whether or not

you went up to Emprise or Sportservice to speak with either Mr. Lou

Jacobs or Ben Reisman about the Rooks and Kachinko loan, prior to

April 4, 1966?

“A It does not refresh my recollection. I did not go to Buffalo and

talk to them about the Alex Kachinko and Art Rooks loan.

“Q Do you recall the testimony, Mr. Zerilli, of Mr. Friedman during

this trial indicating that you were there on that occasion?

“A I recall the testimony, yes.

“Q Are you saying that it was inaccurate and not true?

“A Yes, sir, much of it.

“Q How about this point, was it not true?

“A This point was not true, no, sir.” eT a

p- 5211.

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Michael Santo Polizzi, et al. 43

The main instrument for insuring that the conduct of counsel

does not deprive the accused of a fair trial is the trial judge.

In this case the trial judge clearly did his best to give appellants

a fair trial. Compare United States v. Dellinger, 472 F.2d 340,

385-391 (7 Cir. 1972), cert. denied, 410 U.S. 970 (1973). Errors

were committed, but none so prejudicial, so fatal, either in-

dividually or collectively, as to require reversal. “[FJew, if any

judges can altogether avoid words or action, inadvertent or

otherwise, which seem inappropriate when later examined in the

calm cloisters of the appellate court. But unless such misad-

ventures so persistently pervade the trial or, considered indi-

vidually or together, 2ie of such magnitude that a courtroom

climate unfair to the defendant is discernible from the cold

record, the defendant is not sufficiently aggrieved to warrant a

new trial.” Smith v. United States, 305 F.2d 197, 205 (9 Cir.

1962), cert. denied, 371 U.S. 890 (1962). Appellants have failed

to make a persuasive: showing that their constitutional rights

were violated, and our careful review of the entire record does

not lead to a reasonable inference that the jury’s verdicts were

_ the end result of anything other than an impartial ees saree

of properiy admitted evidence.

VIII Production of Jencks Act Statements

Appellants claim that the prosecution’s failure to produce four

pretrial statements by its witness, Maurice Friedman, in con-

formance wth the Jencks Act, 18 U.S.C. §3500, requires a

reversal. Two of the purported statements are interview memo-

randa prepared, by an assistant United States Attorney; another

is a report by an F.B.I. agent of one of the interviews; and the

last is the transcript of a tape recording of a conversation

between Friedman and one Dr. Victor Lands. The two interview

memoranda and the “Lands transcript” were disclosed to appel-

lants after Friedman’s cross-examination had begun.

The two interview memoranda and the F.B.I. report are not

Jencks Act statements. A written statement falls within that

statute only if it is “made by said witness and signed or other-

wise adopted or approved by him.” 18 U.S.C. §3500(e)(1). The

record shows that Friedman had not signed, adopted; or approved

these three written reports. The government attorney who wrote

ee ee

—_ a

44 United States of America rs.

the memoranda took no notes during the interviews and testified

that the memoranda were his summaries, conelusions, and inter-

pretations cf what Friedman had said. It does not appear that

the F.B.I. report differs in these respects. The rationale of the

Jencks Act is to provide the defense with material that could

impeach uw government witness. “We think it consistent with this

legislative history, and with the generally restrictive terms of ths

statutory provision, to require that summaries of an oral state-

ment which evidence substantial selection of material, or which

were prepared after the interview without the aid of complete

notes, and hence rest on the memory of the agent, are not to be

produced.” Palermo v. United States, 360 U.S. 343, 352-353

(1959). See also Campbell v. United States, 373 U.S. 487 (1963) ;

Rosenberg v. United States, 360 U.S. 367, 369 (1959); Wilke v.

Uniied States, 422 F.2d 1298, 1299 (9 Cir. 1970).

The Lands transcript presents a more difficult question of

construing the Jencks Act, a problem which we find unnecessary

to resolve in this case.** Assuming for the purposes of argument

that it should have been disclosed, we find that the untimely

disclosure here was not prejudicial to appellants. Disclosures are

required by the Jencks Act only for impeachment purposes.®®

Palermo v. United States, 360 U.S. 343, 345 (1959); United

States v. Harris, 458 F.2d 670, 677 (5 Cir. 1972); cert. denied,

409 U.S. 888 (1972). The material in che Lands transcript could

not have been used to impeach Friedman's testimony on direct

examination. Though a question of inconsistency perhaps did

arise with Friedman's testimony on cross-examination, appellants

did then have the transcript. Indeed Friedman was questioned

about it on recross-examination.7° Cf. United States v. Scaglione,

68Prior to 1970, the Lands transcript would clearly not have been with-

in the Jencks Act. 18 U.S.C. §3500(e)(2) then included only statements

made “to an agent of the Government.” The 1970 amendment eliminated

that phrase, but the brief legislative history gives co hint of the Congres-

sional intention behind the change. 2 U.S. Code Cong. & Admin. News

4017 (1970).

69Thus appellants’ additional complaint of prejudicial surprise with

respect to one of Friedman’s answers on cross-examination, that he had

told someone several years before of hidden interests in VFI, has no

merit under the Jencks Act since that Act was not intended to protect

against surprise but rather for impeachment purposes.

70See pages 49-53, infra.

NLD

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—_—

Michael Santo Polizzi, et al. 45

446 F.2d 182, 184 (5 Cir. 1971), cert. denied, 404 U.S. 941

(1971). The prosecution is obligated to disclose to the defense

statements falling within the Jencks Act regardless of anyone's

perception of the utility of the statements for impeachment. But

if, upon review, a failure to disclose appears clearly to be harm-

less and js not a willful avoidance and egregious dereliction of

the prosecutor's statutory obligation, then a court need not invoke

the drastic remedies of striking tectimony or calling a mistria!

as provided by 18 U.S.C. §3500(d). (f. United States v. Amer-

ican Radiator & Stand. San. Corp., 433 F.2d 174, 208 (3 Cir.

1970), cert. denied, 401 U.S. 948 (1971); Pierce v. United States,

414 F.2d 163, 169 (5 Cir. 1969), cert. denicd, 396 U.S. 960 (1969).

IX The Lands Transcript

The Lands transcript is a transcription of a tape-recorded

conversation between Maurice Friedman and one Dr. Victor Lands

in 1967. During that talk, Friedman said in reference to the

attempt to secure a Nevada gambling license for VFI:

“There are thirty-two people who have invested three and

a half million dollars coming before this Commission, all! of

whom have been approved at least by a majority of this

three-man Board. I told you that we feel pretty good except

that our lawyer is very, very nervous, and he understands

through the grapevine that we are going to have one hell

of « time—the thirty-two of us. The Mafia, Casa [sic]

Nostra—everything’s going to come out. This is a public

hearing. The press will know.”

On cross-examination Friedman testified that he had stated in

1967 that there were hidder. interests in VFI. The court then

ordered the prosecution to disclose the Lands transcript. With

the jury absent, Friedman verified the accuracy of the ‘ran-

seript. He said that in using the terms “Mafia” and “Cosa

Nostra” he was referring to appellants Zerilli and Polizzi. He

also testified that he was referring to hidden interests in VFI

when he said to Lands “everything’s going to come out.” Upon

objection by the defense, the transcript was not admitted as

evidence, but the court did permit testimony about the Lands

conversation. The court, in an underr‘andable effort to avoid

i@ any possible prejudice to appeliants Z-illi and Polizzi, ordered

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46 United States of America vs.

Friedman not to use the terms “Mafia” and “Cosa Nostra” in

his testimony before the jury. On redirect examination, Friedman

testified that he had mentioned to Lands that Zerilli and Polizzi

held hidden interests in VFI. On recross-examination Friedman

admitted that in the Lands conversation he had not used the

words “hidden interests” nor referred specifically to any of ap-

pellants.

Although the trial court clearly had the best of motivations in

its handling of the Lands transcript question, preventing preju-

dice to appellants from the use of the terms “Mafia” and “Cosa

Nostra,” it did commit error. Because of the vagueness of the

terms used, the probative value of the Lands transcript in this

case was insubstantial and was clearly outweighed by the possible

prejudice arising from the terms “Mafia” and “Cosa Nostra” and,

in an attempt to eliminate that possibility, by the danger of

allowing testimony deviating from and therefore misrepresenting

the actual terms used in the transcript. The court thus should

not have admitted any testimony referring to the Lands tran-

seript.

Appellants argue that they were seriously prejudiced by this

error. They characterize this episode as a purposeful distortion

of the Lands transcript, a falsification of the record, which re-

sulted in the admission of testimony which is conclusively demon-

strated to be false by the transcript itself and admitted to be

false by the witness. We disagree. The trial court did not order

Friedman to substitute “Zerilli” and “Polizzi” for “Mafia’ and

“Cosa Nostra.” Friedman was instructed only not to use the

latter terms. At most the witness may have misunderstood the

court as suggesting such a substitution.7? Moreover, the Lands

transcript did not contradict Friedman's testimony, as appellants

71“The Court: Now, Mr. Friedman, it is my purpose to avoid your

use of either of those terms [‘Mafia’ and ‘Cosa Nostra’} in the hearing of

the jury.

“Mr. Friedman: I understand, sir.

“The Court: Because of the possible prejudices that might result.

“The Witness: Yes, sir.

“The Court: Do you understand that you are not to use either of

those terms in any reference that you are called upon to make when

referring to this document?

“The Witness: I understand, sir.

x2,

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Michael Santo Poliz-i, et ai. 47

argue. Nor did it confirm that testimony, as the government

urges. The Lands transcript and Friedman’s testimony were

simply not expressly inconsistent. Friedman could, as he did in

the absence of the jury, have commented on what he meant by

some of the terms he had used in talking to Lands. If he had

been permitted to say to the jury that, in using “Mafia” and

“Cosa Nostra”, he was referring to Zerilli and Polizzi, his testi-

mony would clearly have had a strong impact on the jury

adverse to appellants. As it was, his testimony was less precise

on this point’? and was heavily qualified on recross-examina-

tion.7* In light of the substantial evidence in the record sup-

porting appellants’ convictions, we do not find that the error

in handling the Lands transcript was so prejudicial as to require

reversal.

“The Court: Is there a manner that you can state names that you

intended referring to at the time you were speaking ia this document for

those offensive words?

“The Witness: The gentlemen that I understood were Mr. Shapiro’s

associates, yes, sir.” Reporter’s Transcript, Vol. 10, pp. 1981-1982.

72“Q Isn’t it a fact that you told Dr. Lands on that date that certain

hidden iaterests in that casino were going to come out?

“A Words to that effect, yes, sir.

s oe . e s

“Q When you used the phrase ‘hidden interests,’ talking to Dr. Lands,

to whom did you refer?

“A To Mr. Shapiro’s partners from Detroit.

“Q Who?

“A Mr. Zerilli and Mr. Polizzi.” Reporter’s Transcript, Vol. 10, p.

2000.

78“Q So that to put it right on the line, Mr. Friedman, you weren’t

trying to tell Dr. Lands that there was a hidden interest in the Frontier

Hotel, were you?

“A No, I was trying to tell Dr. Lands why I was investigated in the

Friars Club case.

“Q And you weren’t trying to tell Dr. Lands, were you, that either

Mr. Polizzi or Mr. Zerilli had any hidden interest in the Frontier Hotei,

were you?

“A No, I wasn’t.

“Q And, in fact, you did not mention hidden interest or Mr. Polizzi’s

name or Mr. Zerilli’s name or Mr. Shapiro’s name or any of thuse de

fendants’ names in your conversation with Dr. Lands, is that correct ?

“A No, I didn’t sir.

“Q And you didn’t intend to mention any of their names to Dr.

Lands, did you?

“A No, sir.” Reporter’s Transcript, Vol. 10, p. 2036.

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48 United States of America vs.

We find that, in light of all of the evidence of record, appel-

lants also did not suffer prejudice from the government’s argu-

ment to the jury concerning the Lands transcript, and that the

court’s response to the jury’s request for a reading of the testi-

mony about the Lands conversation was not an abuse of its discre-

tion.7* United States v. Baxter, 492 F.2d 150, 175 (9th Cir. 1973) ;

United States v. De Palma, 414 F.2d 394, 396-397 (9 Cir. 1969),

cert. denied, 396 U.S. 1046 (1970).

X. Concealment of Prosecution Promises of Leniency

Appellants contend that the prosecution failed to disclose its

agreements with or promises of leniency to its key witness, Mau-

rice Friedman, as required by Giglio v. United States, 405 U.S.

150 (1972). Friedman, serving prison sentences concurrently for

three federal convictions, had his sentences modified after appel-

lants’ convictions and was released from prison. The prosecution

did disclose a promise to Friedman that his testimony in this

ease would be called to the attention of the Parole Board, but

maintained that no other promises were made. Appellants argue

that the prosecution did also promise to urge the reduction of

Friedman’s sentences and stipulated that Friedman’s motions for

74The court did not deny the jury’s request. The jury did not renew

its request after the court gave its cautionary remarks:

“Before I agree to having it reread to you, I want to be certain that

a rereading of any testimony is deemed important by the jury at this

time to assist you in your deliberations. The reason for that is that we

like very much to have you depend upon your own memory of the evi-

dence and testimony in this case and not to have any testimony reread.

We feel that to pick out certain portions of the testimony is very prob-

ably to unduly emphasize that testimony. At the same time I can con-

ceive that a situation may have arisen during your deliberations that

makes you feel rather compelled that the testimony on certain portions

of the testimony ought to be reread to you, and if you feel that you

would be assisted in your deliberations by a rereading of the testimony

I will order that it be done.

“On the other hand, if you feel that you can continue with your de-

liberations successfully without a rereading of any of the testimony and

depending upon your memory cf it, I would prefer that, and I think

counsel would too.” Reporter’s Transcript, Vol. 46, pp. 8963-8964.

Appellants’ counsel also object to the implication arising from the

court’s statement that defense counsel concurred in the court’s preference.

That the court’s comment could have had some profound impact on the

jury is frivolous speculation.

CR a NOEL CEI ED OS) FV PELE TENG LE eB HO BU Nh ALA et Lot OL ATEN WO

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Michael Santo Polizzi, et al. 49

modification of sentence could remain submitted but undecided

until after the trial in this case.75 Appellants, however, do not

argue that express agreements were reached, but rather that there

was an implicit mutual understanding that the prosecution would

try to help Friedman.

Having reviewed the arguments and evidence presented by ap-

pellants on this point, we do not find that they establish undisclosed

promises by the prosecution.*¢ More importantly, however, even if

undisclosed promises had been made, appellants would not have

suffered prejudice as a result of the prosecution’s dereliction.77 The

prosecution did diselose a promise to inform the Parole Board of

Friedman's testimony. This diselosure alerted the defense and the

jury to the possibility that the testimony was motivated by self-

interest. Cf. United States v. Sidman, 470 F.2d 1158, 1165 (9 Cir.

7Appellants contend that the federal judges who modified Friedman’s

sentences violated Rule 35 of the Federal Rules of Criminal Procedure.

Appellants’ position is unmeritorious. This Court, in a decision constru-

ing Rule 35 in its form prior to amendment in 1966, ruled that it re-

quired a motion for reduction to be made within 60 days and not final

action on the motion within that time. Leyras r. United States, 371 F.2d

714, 719 (9 Cir. 1967). The 1966 amendment increased the time limit to

120 days. There is authority for appellants’ position that the 120-day

limit also applies to judicial action. Cf. 8A J. Moore, Federal Practice

$35.02[2], p. 35-6, n. 10.1 (2d ed. 1973). We do not feel, however, that

the amendment necessitates a change in the Leyras ruling. See Irizzary v.

United States, 58 F.R.D. 65, 67 (D.Mass. 1972) : “The 120 day period is

technically not the time within which the motion may be made, but is

rather the time within which the court may act. * * * However, as a

matter of practice, the requirement has been interpreted to permit a court

to act upon a motion as long as the motion is made within that period.”

76The evidence consists of the government’s stipulations in continuing

the motions for modification and the modifications after appellants’ con-

victions, a statement during a post-trial hearing in this case by Assistant

U.S. Attorney Nissen that he had told Friedman’s attorney that Fried-

man’s cooperation would be called to the attention of “the court or what-

ever appropriate authority it would be” (Reporter’s Transcript, Vol. 51,

p. 10,173), and the affidavit of Friedman’s former custodian that Fried-

man had told him that the government had said that Friedman would be

released after testifying in this case.

*7Failure to disclose such promises will not require reversal unless it is

reasonably likely that the jury’s judgment would have been affected by

disclosure. Giglio v. United States, 405 U.S. 150, 154 (1972); Napue o.

Illinois, 360 U.S. 264, 271 (1959).

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50 United States of America vs.

1972).78 The trial court then instructed the jury specifically on

carefully weighing the testimony of “an informer who provides

evidence against a defendant for pay, or for immunity from pun-

ishment, or for personal advantage or vindication.”?® Defense coun-

sel did cross-examine Friedman about his motive for testifying. Fi-

nally, the pending motions for modification of sentence were public

records, available to the defense, and could have been the basis for

cross-examining Friedman.

I concur in the portions of this opinion prepared by Judges

Browning and Duniway.

BROWNING, Cireuit Judge:

I concur in the portions of this opinion prepared by Judges Ren-

frew and Duniway.

XI. Unitary Crime Contentions

Appellants argue that “this case concerns a unitary event—the

maintenance of Vegas Frontier Inc. from July 27, 1967 to Novem-

ber 27, 1967,” and therefore conviction and punishment on a count

charging conspiracy and several counts charging substantive of-

fenses was improper.! The argument includes two propositions:

that Congress did not intend to make conspiracy to violate 18

U.S.C. §1952 a separate crime from the substantive offense; and

that Congress did not intend to allow prosecution as a separate

offense of each of several acts of travel where the illegal intent

78This point is not inconsistent with Napue v. Illinois, 360 U.S. 264,

268, 270-271 (1959). There the jury was told, contrary to fact, only that

an unidentified lawyer from the public defender’s office, not a state rep-

resentative, had promised to help the witness. Here the prosecution dis-

closed that it would help the witness.

79See footnote 34, supra.

1The argument does not apply to Emprise Corporation, Rooks, or

Giordano, who were each charged and convicted only of conspiracy. The

other four defendants were each convicted and sentenced for conspiracy

and more than one substantive count. The jail terms were concurrent, but

separate fines were imposed on each defendant on the conspiracy count

and at least one substantive count. Therefore, each of these defendants

was affected adversely by the separate convictions, and the concurrent

sentence doctrine is not applicable. See Benton v. Maryland, 395 U.S. 784

(1969) ; United States v. Tucker, 435 F.2d 1017 (9th Cir. 1970). |

— A-51 —

Michael Santo Polizzi, et al. 51

during each act related to the same unlawful activity. Neither

proposition has merit.

A.

“The distinctiveness between a substantive offense and a con-

spiracy to commit it is a postulate of our law. ‘It has been long and

consistently recognized by the Court that the commission of the

substantive offense and a conspiracy to commit it are separate and

distinct offenses.’ Callanan v. United States, 364 U.S. 587, 593

(1961), quoting Pinkerton v. United States, 228 U.S. 640, 643

(1946). Accordingly, unless there is specific language to the con-

trary, Congress presumably intended to permit punishment as

separate offenses of both the substantive crime and a conspiracy

to commit it. 364 U.S. at 59495. There is no such language here,

in either the statute? or legislative history.

2See pages 5-6 supra for a discussion of the statute.

3There is no constitutional bar to separate convictions and sentences

for the substantive offenses defined by § 1952 and for conspiracy to com-

mit that offense. Nolan v. United States, 423 F.2d 1031, 1047-48 /10th

Cir. 1970). “Only if the substantive offense and the conspiracy are iden-

tical does a conviction for both constitute double jeopardy.” Pereira v.

United States, 347 O.S. 1, 11 (1954). An agreement or common course

of conduct among two or more persons is not an essential element of the

substantive offense under § 1952: The travel required by § 1952(a) might

be accomplished by only one person, and the “business enterprise” re-

quired by § 1952(b)(1) also might be conducted by an individual. True,

both the legislative history (see United States v. Roselli, 432 F.2d 879,

886 n.8 (9th Cir. 1970)), and case law (see, e.g., United States v. Dona-

way, 447 F.2d 940, 944 (9th Cir. 1971)) indicate that § 1952 is not

directed against casual and isolated instances of illegal conduct. But

neither suggest that the substantive crime requires the participation of a

group of people.

Further, the conspiracy alleged here is not merely an agreement to

violate state law bunt an agreement to travel interstate with the intent to

promote certain violations of state law. It is distinct from the joint

activity that might be irvolved in running the business enterprise men-

tioned in § 1952 even if the “business enterprise” language were construed

to require more than a sole proprietorship.

Nor is there any constitutional bar to conviction for both conspiracy

and 18 U.S.C. § 2, the aiding and abetting statute underlying the con-

vietion of some of the defendants on some of the substantive counts.

United States v. Valencia, ...... i saieiiel (9th Cir. Feb. 1, 1974);

Pereira v. United States, 347 U.S. 1, 11-12 (1954).

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52 United States of America vs.

B.

Turning to the second proposition, the language of the statute

seems unambiguous. The offense defined is an act of travel or use

of an interstate facility, with the requisite intent, plus subsequent

performance of another act of the kind specified in the statute.

Appellants argue, however, that the legislative history indicates

that section 1952 was directed at a “course of conduct,” and there-

fore various acts of travel in furtherance of a single “unlawful

activity,” 18 U.S.C. §1952(b), should be held to constitute only one

crime. But “the ‘course of conduct’ referred to in the . . . legisla-

tive history of Section 1952 refers to the nature of the business

promoted or facilitated—and not to the essence of the federal of-

fense, which is ‘travel.’” United States v. Teemer, 214 F. Supp.

952, 958 (N.D. W.Va. 1963),4 quoted with upproval in Katz v.

United States, 369 F.2d 130, 135 (9th Cir. 1966).

No appellate court appears to have discussed the proper unit of

prosecution under section 1952,5 but similar federal statutes mak-

ing it a crime to use interstate transportation or communications

facilities in aid of illegal purposes have been construed to permit

prosecution of cach use of such facilities as a separate offense. See,

e.g., Sanders v. United States, 415 F.2d 621, 626-27 (5th Cir. 1969) ;

Katz v. United States, supra; Mitchell v. United States, 142 F.2d

480 (10th Cir. 1944). The cases upon which appellants rely (Brav-

4Judge Paul continued, 214 F. Supp. at 958:

The phrase seems to refer to the fact that the Act was designed to

attack an entrenched operation rather than a sporadic poker game

or a floating crap game. No act of travel is to be deemed unlawful

unless the enterprise is a continuing one; but once the continuity of

the enterprise is established, any act of travel, with the requisite

intent and the subsequent participation, would seem to be a separate

offense, even if the travel is a daily or regular event, and thus, per-

haps, a “continuing” activity. If this is the plain and literal mean-

ing of the Act, it is within the power of Congress to make each act of

travel a unit of prosecution. See, e. g., Mitchell v. United States, 142

F.2d 480 (10 Cir., 1944); and this, in spite of the distinguishable

eases of United States v. Universal CIT Credit Corp., 344 U.S. 218,

73 S.Ct. 227, 97 L.Ed. 260 (1952) and Bell v. United States, 349

U.S. 81, 75 S.Ct. 620, 99 L.Ed. 905 (1955).

5Separate convictions and sentences for individual acts of travel in

violation of 18 U.S.C. § 1952 have been affirmed without discussion of the

issue raised here, See, ¢.g., United States v. McGowan, 423 F.2d 413, 416

(4th Cir. 1970).

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— A-53 —

Michael Santo Polizzi, et al. 53

erman v. United States, 317 U.S. 49 (1942); United States v. Uni-

versal C.1.T. Credit Corp., 344 U.S. 218 (1952); Bell v. United

States, 349 U.S. 81 (1955); and Rewis v. United States, 401 U.S.

808 (1971)) are inapposite.¢

In view of the plain import of the language of section 1952, the

absence of any contrary indication in the legislative history,” and

the construction given comparable statutes over the years, we con-

clude that each act of travel may be treated as a separate violation

of section 1952.

‘The issue in Braverman was whether a single agreement to commit

several criminal acts constituted one or several conspiracies. In the pres-

ent case only one conspiracy was charged. Bell held that a single act of

transporting two women interstate at the same time was one violation of

the Mann Act. In the instant case, each substantive charge involved a

separate act of travel on a different day. There was no attempt to carve

several offenses out of a single transaction.

Universal C.1.T. is somewhat closer on its facts. As the Court pointed

out, however, there was specific evidence in the legislative history of the

Fair Labor Standards Act that Congress did not intend each breach of

the statutory duty with respect to minimum wages and overtime owed to

each employee during each work week to be treated as a separate crime.

344 U.S. at 222-24. Also, the language of the Act was ambiguous as to

the proper unit of prosecution. If not construed to limit prosecution to

an entire course of conduct no limit at all was imposed on the number of

crimes that could be charged. Here, the statute is unambiguous; it is

explicitly directed at acts of travel and use of interstate facilities, and

the prosecution can charge only as many separate crimes as there were

separate acts of travel or use of interstate facilities. Where the com

mand of the statute as to the unit of the offense is clear, there is no room

for application of the so-called “rule of lenity” of the Bell case. See

Callanan v. United States, 364 U.S. 587, 596 (1961). It is true, as appel-

lants point out, that the Supreme Court applied the “rule of lenity” to

§ 1952 in support of the ruling in Rewis, 401 U.S. at 812, that interstate

travel by patrons of a gambling establishment did not violate the Act.

But the Court premised this application upon a determination that there

was an ambiguity in the language of § 1952 relating to persons covered.

401 U.S. at 811. There is no such ambiguity with respect to the unit of

the offense.

*Congress may well have concluded there was a separate social interest

in deterring each act of travel in Zurtherance of an illegal enterprise :

each successive trip may increase the success of the illegal activity, and

a decision not to make a given trip for fear of additional penal conse-

quences could therefore limit the harm to society 41952 is intended to

prevent. Cf. Irby v. United States, 390 F.2d 432, 434 (D.C. Cir. 1967)

(en bane).

"ALLEL MTEC IN EE RE Rt Ae rt Ti ies pcm

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— A-54 —

54 United States of America vs.

XII. Venue

Appellants raise two venue-related claims. They contend venue

was improperly laid in the Central District of California as to some

of the substantive counts.§ They also contend the trial court abused

its discretion by denying motions under Federal Rule of Criminal

Procedure 21(b) to transfer the proceedings to Detroit or Las

Vegas.

i A.

i Appellants argue venue was improperly laid as to certain sub-

: stantive counts for two reasons. First, relying on United States v.

Bozza, 365 F.2d 206 (2d Cir. 1966), they argue that the act of

carrying on, or distributing the proceeds of, unlawful activity, re-

quired to complete an offense under section 1952, did not occur in

the Central District of California, though travel with the requisite

; intent did. Second, they argue that some of the defendants in each

3 count. were charged not with themselves traveling but with aiding

sade ns

and abetting the travei of others. Again, appellants rely on Bozza:

“Congress seems to have been content with venue where the defend-

: ants’ own accessorial acts were committed or where the crime oc-

: curred, without providing still another where the accessorial acts

j of agents took place.” 365 F.2d at 221.

But in Bozza, the offense related to the offense of receiving stolen

stamps. As the Bozza court pointed out, this is not “a continuing

offense which is ‘held, for venue purposes to have been committed

wherever the wrongdoer roamed’... .,” (quoting Travis v. United

States, 364 U.S. 631, 634 (1961)) but rather is a “ ‘single act which

occurs at one time and at one place in which only it may be tried,

although preparation for its commission may take place elsewhere’ ”

(quoting Reass v. United States, 99 F.2d 752, 754 (4th Cir. 1938)).

365 F.2d at 220.

In contrast, the offense under section 1952 is one “involving . . .

transportation in interstate . . . commerce,” which, by express pro-

vision of the general venue statute, “is a continuing offense and

%Appellants do not attack venue on the conspiracy count. “[Ajn overt

act committed in the course of a conspiracy which occurs in a district

gives rise to jurisdiction to prosecute the conspirators in that district.”

United States v. Baruard, 490 F.2d 907, 910 (9th Cir. 1973). Several

consequential overt acts are alleged to have occurred in the Central Dis-

trict of California. :

ee Ae een ae ad + OS side

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—

Michael Santo Polizei, et al. 55

... May be... prosecuted in any district from, through, or into

which such commerce . . . moves.” 18 U.S.C. §3237(a). See United

States v. Guinn, 454 F.2d 29, 33 (5th Cir. 1972); cf. United States

v. Barnard, 490 F.2d 907, 911 (9th Cir. 1973).

Thus, a defendant can be prosecuted for traveling in violation

of section 1952, or for aiding and abetting such travel, in any dis-

trict in which the travel occurred.

B.

Whether the proceedings should have been transferred is an en-

tirely separate question. Rule 21(b), Federal Rules of Criminal

Procedure, permits transfers “[f]or the convenience of parties and

witnesses, and in the interest of justice.” Since the decision as to

whether to grant such a transfer “must largely rest in the sound

judicial diseretion of the trial judge,” Wagner v. United States,

416 F.2d 558, 562 (9th Cir. 1969), our review is limited to whether

that diseretion was abused. We conclude it was not.

Appellants’ first motion requested a transfer to Detroit; Las

Vegas was also mentioned as a proper venue for trial, but the

motion did not request transfer there. In support of their motion,

appellants pointed out that most of the appellants and many of

the anticipated defense witnesses lived in the Detroit area, and

that much of the conduct relevant to the charges occurred there.

But relevant conduct had occurred in many places, including the

Los Angeles area and nearby Las Vegas, where the business enter-

prise that defendants allegedly sought to control was located. Ne-

vada law was important to the case, as appellants argued. The

relevance of this circumstance is obscure; in any event, it scarcely

favored trial in Detroit as against Los Angeles. Both government

and defense witnesses were widely dispersed, but 10 of the 31 per-

gons on the government’s list of anticipated witnesses resided in

the Los Angeles area. The criminal calendar in the federal district

court in Detroit was seriously delayed; the Los Angeles calendar,

on the other hand, would permit the early trial for which appel-

lants had repeatedly called. This consideration, admittedly rele-

vant, sce Platt v. Minnesota Mining & Manufacturing Company,

376 U.S. 240, 242 1: (1964), appears to have swung the balance.

On the basis of the information before the trial court. the deci-

sion <n the first motion seems entirely reasonable. Appellants’ resi-

emeniiaianieenenne

— A-56 —

56 United States of America vs.

dence was a factor to be considered, but was not controlling. Platt

v. Minnesota Mining & Manufacturing Company, supra, 376 U.S.

at 245-46; Jones v. Gasch, 404 F.2d 1231, 1240 n.43 (D.C. Cir.

1967). The considerations for and against a transfer seemed fairly —

balanced, or at least not so clearly weighted against Los Angeles

as the trial forum as to overcome the substantial interest in avoid-

ing the delay that would have followed transfer to Detroit’s con- |

gested calendar.

Appellants’ main argument is not that the court abused its dis-

eretion in the balance it struck on the facts before it on the first

motion. Rather, appellants assert that “the prosecution misrepre-

sented to the court that numerous of its witnesses would be Los

Angeles area residents, and that Detroit witnesses desired by appel-

lants would be called by the prosecution itself, thereby obviating

some of the prejudice to the defense of a distant trial.”

The trial judge was under no misapprehension regarding the

Detroit witnesses when he ruled against the initial motion to trans-

fer; the government had advised the court it did not intend to call

more than one or two witnesses from Detroit. It is true that many

of the Los Angeles witnesses on the government’s first list disap-

peared from the second list, filed several months later. But it is

hardly surprising that the prosecution’s plans with respect to wit-

nesses changed in the course of preparing this complex case for

trial, particularly since government counsel who prepared the first

list had been replaced by new government counsel.® Appellants’

foreeasts regarding the number and residence of their witaesses

turned out to be no more reliable than the government’s.

Several months after denial of the initial transfer motion, ‘both

sides filed new witness lists. The prosecution dropped most of its

9A situation could arise where the prosecution’s representations to the

judge were so far from the mark that they could only be treated as sub-

mitted in bad faith to improperly prevent a change of venue. In such a

situation, we would look beyond the information presented to the trial

judge in determining whether denial of transfer was within the judge’s

discretion, since the trial judge has a responsibility to pierce the prose-

eution’s representations and assure that they are made in good faith.

And, if the transfer were initially denied on the basis of prosecution in-

formation later shown to have been submitted in bad faith, the trial

jndge would be obligated to view a renewed motion as if it were an origi-

nal one, without requiring the especially strong showing that may be

required to support a late motion. See note 10 infra. awe

ESTEE Bs erate mirth ots eM — —-"

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— A-57 —,.

Michael Santo Polizzi, et al. 57

Los Angeles witnesses and added a number from Las Vegas. The

defense renewed its motion for change of venue, this time pressing

for transfer to Las Vegas. It appeared, however, that the condition

of the criminal docket in Las Vegas was such that a reasonably

speedy trial could not be obtained, whereas trial in Los Angeles

was imminent. The trial court denied the renewed motion both on

this ground and because the witnesses then expected to be called

resided throughout the country.

This was not an abuse of discretion. It is proper to require a |

greater showing of inconvenience when a change of venue is sought

late in proceedings.!° As the trial court observed, there was no

“ideal place for the holding of this trial.” Wherever the trial was |

held, both sides would bear significant transportation and lodging .

expenses. Moreover, most of the Las Vegas witnesses were guvern-

ment witnesses; since the government appeared willing to pzy the

expense of transporting them, it is hard to see how defendants

would be more inconvenieced by trial in Los Angeles than in Las

Vegas. The improbability of a speedy trial in Las Vegas was a.

factor entitled to great weight, especially since one defendant had

already moved for dismissal on speedy trial grounds.

The motion for change of venue was renewed a third time, after

yet another set of witness lists was filed. The trial judge reiterated

his belief that only compelling reasons could justify transfer when

trial was imminent. For the reasons stated, this final denial was

not an abuse of diserction.

XIII. Giordano’s Severance Motions

Appellant Giordane complains that the trial court abused its

discretion in denying his motions for severance under Rule 14,

Federal Rules of Criminal Procedure, submitted both before and

during trial.

10Rule 22, Fed. R. Crim. Pr., provides that “{a] motion to transfer

under these rules may be made at or before arraignment or at such other

times as the court or these rules may prescribe,” suggesting that the court

may decline to entertain a late motion. See United States v.

351 F.2d 144, 146 (6th Cir. 1965); Cagnina v. United States, 223 F.2d

149, 154 (5th Cir. 1955). Here, there has been a change in the situation

sinee the initial venue decision. Nonetheless, to avoid the obvious oppor-

tunity for abuse it was proper to require a greater showing of incon-

venience when trial was imminent.

— A-58 —

58 United States of America vs.

Denial of Giordano’s pretrial severance motion was clearly cor-

rect. Although Giordano was indicted on only one count, that count

charged conspiracy. For obvious reasons, a joint trial is partieu-

larly appropriate where conspiracy is charged. Davenport v. United

States, 260 F.2d 591, 594 (9th Cir. 1958). See American Bar Asso-

ciation, Standards Related to Joinder and Severance 39 ( Approved

Draft 1968).

‘ The government represented that Giordano was among the “lead-

ers” in the unlawful scheme and furnished the court with a sum-

mary of the evidence it expected to offer linking Giordano to the

conspiraéy. Moreover, the government stated that a separate trial

would be substantially as long as a joint one, since a full exposi-

tion of the entire scheme was necessary to establish the significance

of Giordano’s separate conduct. On this record the advantages and

economy of a joint trial clearly outweighed the remote possibility

of unwarranted prejudice. See United States v. Donaway, 447 F.2d

940, 943 (Mh Civ. 1971).

The balance may not have been so clear when Giordano moved

for severance during trial. Although there is no suggestion of bad

faith, the evidence against Giordano did not entirely justify gov-

ernment counsel’s optimistic forecast. Nonetheless, there was sffi-

cient evidence other than acts and statements of co-conspirators to

show that Giordano participated in the conspiracy. Since this is so,

it is difficult to understand how Giordano could have benefited from

severance, for evidence of the acts and statements of the other

defendants pursuant to and in furtherance of the conspiracy would

have been admissible. against Giordano if tried alone."! United

11Giordano stresses the fact that a very small proportion of the trial

transcript relates directly to him; the government engages in elaborate

analyses which, it claims, show that Giordano was not as peripheral to

the proceedings as he claims. We do not consider, however, that the exact

quantity of evidence relating to a conspiracy defendant personally is im-

portant in determining whether severance should have been granted. Al-

though there are some cases which take this factor into account (see

United States v. Branker, 395 F.2d 881, 888 (2d Cir. 1968); United

States v. Donaway, 447 F.2d 940, 948 (9th Cir. 1971)), they concern

defendants against whom conspiracy charges were dismissed during trial.

Dismissal of a conspiracy charge does not mean that severance is re-

' quired. Schaffer v. United States, 362 U.S. 511, 516 (1960). It does, how-

ever, shift the balance of factors to be considered, see Schaffer, supra; a

separate trial would not entail a replay of the joint conspiracy trial, and

— A-59 —

Michael Santo Polizzi, et al. 59

Stotes v. Kenny, 462 F.2d 1205, 1218 (3d Cir. 1972); see also

United States v. Roselli, 432 F.2d 879, 901 (9th Cir. 1970). More-

over, as the government asserted, all or substantially all such evi-

dence probably would have been introduced in a separate trial. It

is possible that the government might have considered the time and

effort required for a separate trial too great a price to pay for the

conviction of Giordano alone, but loss of that possibility hardly

demonstrates that Giordano was “prejudiced by a joinder” within

the meaning of Rule 14.

The trial judge took great pains to protect Giordano’s right to

an independent evaluation by the jury of the evidence against him.

Twice during voir dire the court admonished the jury that each

defendant—naming them, including Giordano—was entitled to be

judged as an individual. No less than six times during instructions

to the jury the court stressed the imporiance of separate deter-

minations of each defendant’s guilt or innocence on the basis of

the evicence pertaining to the particular defendant. Several times

the court warned that association with participants in a conspiracy

does not prove that a defendant was a member of the conspiracy.

This jury’s ability and determination to make discriminating judg-

ments is evidenced by the fact that it did not convict one of the

most active participants in the conspiracy, defendant Polizzi, on

one of the nine substantive counts on which he was charged. Obvi-

ously, this jury did not render a mass judgment. United States v.

Berlin, 472 F.2d 13, 15 (9th Cir. 1973). There may be cases in

which even careful jury instructions cannot cure the possibility of

prejudice by association inherent in conspiracy trials’? but this

was not one of them.

much of the evidence admitted in the joint trial could not be considered

against the defendant no longer charged with conspiracy. In the instant

case, most of the evidence not directed to Giordano personally was none-

theless admissible against him, so that the proportion of personally ori-

ented evidence is not important.

'2See Krulewitch v. United States, 336 ' S. 440, 454 (1949) (Jackson,

J., concurring) ; United States v. Donaway, 447 F.2d 940, 943 (9th Cir.

1971). But see United States v. Cozzetti, 441 F.2d 344, 349 (9th Cir.

1971) ; United States v. Patterson, 455 F.2d 264, 266-67 (9th Cir. 1971);

United States v. Roselli, 432 F.2d 879, 902 (9th Cir. 1970), all holding

that careful jury instructions can be sufficient to guard against this kind

of possible prejudice from joinder.

— A-60 —

60 United States of America vs.

Giving due recognition to the somewhat stricter showing required

to justify severance when the trial has been partially or wholly

completed,!* we conclude that Giordano’s motions for severance

during trial were properly denied.

XIV Giordano’s Requested Instruction

Giordano rested at the close of the government’s case-in-chief.

He asked for a jury instruction that no evidence introduced there-

after could be considered against him. The request was denied.

Giordano’s co-defendants then testified in their own defense. In

arguing the case to the jury, the government drew implications

from this testimony adverse to Giordano.

Gioriano’s decision not to offer evidence in his own behalf

preserved his right to a review of the denial of his motion for

acquittal on the basis of the government’s evidence alone. See

United States v. Figueroa-Paz, 468 F.2d 1055, 1058 (9th Cir.

1972). But this is not to say, if denial of the motion te acquit

was proper, that the jury was not entitled to consider all of the

evidence, including that presented by Giordano’s co-defendants,

in determining Giordano’s guilt.

Evidence offered in defense in the trial of a single defendant

is available for all purposes, and the rule is the same in a joint

trial of multiple defendants—evidence offered by one may sup-

port the conviction of the others. See Rickey v. United States,

242 F.2d 583, 586 (5th Cir. 1957); Maupin v. United States,

225 F.2d 680, 682 (10th Cir. 1955). This court has held that the

same rule is applicable even to a defendant who has rested at

the close of the government's case, and an instruction of the kind

sought by Giordano is therefore properly refused. Brown v.

United Stctes, 56 F.2d 997, 999-1000 (9th Cir. 1932).4

I83ABA, Standards Relating to Joinder and Severance 33 (Approved

Draft 1968).

14Giordano cites one instance in which the instruction he requests was

given, United States v. Schneiderman, 106 F. Supp. 906, 928 (S.D. Calif.

1952), but there was no discussion in Schneiderman of the i issue. See also

United States v. Interstate Engineering Corp., 288 F. Supp. 402, 413-14

(D. N.H. 1967); Devitt & Blackmar, Federal Jury Instructions § 10.06

(1970). But see United States v. Zambrano, 421 F.2d 761, 763 (3d Cir.

1970), supporting the Brown holding by necessary implication.

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Michael Santo Polizzi, et al, 61

There is a substantial reason for the rule. One purpose of a

joint trial of defendants allegedly involved in a single scheme

is to facilitate evaluation by the jury of the evidence against

each defendant in light of the entire course of conduct. “Such

procedure not only increases the speed and efficiency of the

administration of justice but also serves to give the jury a

complete over-all view of the whole scheme and helps them to

see how each piece fits into the pattern.” Rakes v. United States,

169 F.2d 739, 744 (4th Cir. 1948). See ABA Standards Relating

to Joinder and Severance 39 (Approved Draft 1968). This

purpose of joinder would be frustrated as to a particular defend-

ant if he could bar consideration as to him of some of the

relevant evidence by resting before that evidence was introduced.

As we emphasized in Brown, a defendant who rests his case

"may nonetheless cross-examine oi introduce evidence to impeach

or contradict a co-defendant who testifies thereafter. See also

United States v. Zambrano, 421 F.2d 761, 763 (3d Cir. 1970).

In the present case, as in Brown, there was no request to cross-

examine the co-defendants or to admit rebuttal evidence. It is

even clearer here than in Brown that “if such request had been

made, it would have been granted,” 56 F.2d 1000, since the

trial judge asked Giordano’s attorney after each defense witness

whether he had any questions to ask by way of cross-examina-

tion.15

XV Sufficiency of the Evidence—Giordano

We consider Giordano’s contention that the evidence was in-

sufficient as to him separately from the same contention as to

other defendants. The case against Giordano was the weakest; and,

his right to test the government's case-in-chief on appeal rf he offers evi-

dence only to counter a co-defendant’s incriminating evidence; the Court

of Appeals for the District of Columbia held that there is no waiver. This

court has never squarely accepted or rejected the Cephus rule. See United

States v. Figueroa-Paz, 468 F.2d 1055, 1058 (9th Cir. 1972) ; Verdugo v.

United States, 402 F.2d 599, 604 n.4 (9th Cir. 1968).

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62 United States of America vs.

unlike other defendants, Giordano did not waive his right to

review of the motion to acquit made at the close of the govern-

ment’s case. For the latter reason, we consider only the evidence

produced against Giordano in the prosecution’s case-in-chief.

As Giordano points out, the government offered no direct evi-

dence of his participation in the conspiracy.'¢ But “cireum-

stantial evidence is not inherently less probative than direct

evidence,” United States v. Nelson, 419 F.2d 1237, 1239 (9th

Cir. 1969), and, in many conspiracy cases, is the only kind of

evidence available. White v. United States, 394 F.2d 49, 51 (9th

Cir. 1968). Thus, denial of the motion to acquit is subject to

the same standard on review as it would be if there were direct

evidence of guilt: whether “jurors reasonably could decide that

they would not hesitate to act in their own serious affairs upon

factual assumptions as probable as the conclusion” that Giordano

participated in the conspiracy. United States v. Nelson, supra,

419 F.2d at 1245.

The government's theory was that at Zerilli’s solicitation Gior-

dano arranged for the investment of $150,000 in VFI when the

enterprise was in critical need of funds; that the investment

was made through Sansone, a St. Louis real estate investor and

bank director, acting as a “front”; and that following the in-

vestment Giordano participated at various critical stages in the

illegal enterprise.

Some of the government’s circumstantial evidence is described

briefly in the margin.'7? Possibly the series of events disclosed

16Friedman, a co-conspirator who testified for the government, and

Feil, another witness who testified directly to the illegal involvement of

some defendants, offered no evidence implicating Giordano; none of the

four government witnesses who might, on the prosecution’s theory, have

known of Giordano’s involvement in the conspiracy, directly implicated

him.

17Giordano and Zerilli were close friends. Giordano lived in St. Louis,

Zerilli in Detroit. There were telephone calls between Giordano’s home

and office and Zerilli’s, as well as other calls charged to Zerilli’s credit

card and placed to Giordano’s numbers, at various key times in the course

of events between June and November, 1967. Giordano knew the Cusu-

manos and the Sansones in St. Louis. The Sansones did not know Zerilli.

The need for additional money, which resulted in the issuance of the

Class C debentures Sansone later bought, developed in early June. There

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— A-63 —

Michael Santo Polizzi, et al. 63

by the evidence could be explained as coincidence, or as normal

contacts among friends. On the other hand, “(t]he jury un-

were calls between telephones listed to Giordano and Zerilli at that time.

Zerilli came to St. Louis for two days on June 8.

The Sansones began gathering money for their VFI investment after

Zerilli visited St. Louis, but before the Class C debentures in which they

invested were officially issued. They could have learned about the invest-

ment possibility only from a person having knowledge of the inner opera-

ticns of VFI.

In early August, Giordano repaid an overdue loan to the Cusumano

family trust. Less than three weeks later, Sansone took out a loan from

the same trust. This loan was part of the money Sansone eventually in-

vested in VFI. The Sansone loan was the only business transaction ever

consummated between Sansone and the Cusumano family. It was unse-

eured. Although the VFI debentures in which Sansone invested yielded

4° interest, the loan from Cusumano was at 7%, an anomaly for which

Sansone had no convincing explanation.

The Sansone investment was withdrawn less than 60 days after it was

made, after Sansone was told by the Nevada Gaming Commission that he

would have to apply for a gaming license, disclose the source of the in-

vested funds, and provide fingerprints. Sansone testified that he withdrew

only because, “I never anticipated that I would have to be classified as a

gambler when I bought the debenture.” But from the outset the Sansones

admittedly knew they were investing in a gambling casino.

Giordano made five trips to Las Vegas between July and November

1967. The Giordanos have no business interests or relatives in Las Vegas,

and Giordano was not a gambler. Each of these trips was closely pre-

ceded, or followed, or both, by telephone contact between Giordano tele-

phones and Zerilli telephones or phone calls charged to Zerilli. Each trip

coincided with an important event in the unlawful scheme. For example,

trips in September and November coincided with the beginning and end

of the $150,000 investment.

On September 12 there was a series of phone calls between Zerilli’s

home and Giordano’s home and business. The next day, Sansone mar-

shaled the entire $150,000. On that same day there was a call from a

Zerilli telephone to Giordano’s telephone. On September 14 Sansone flew

to Las Vegas with the money to make the investment. He checked into

the Frontier Hotel. Sixteen minutes later, Giordano checked into the

Dunes Hotel. Four days later, Sansone deposited the $150,000 in VFI’s

account, received the debentures, and left Las Vegas. Giordano departed

the following day. In November, a telephone call to Giordano was

charged to Zerilli on the same dey the Nevada Gaming Commission’s

letter was sent. to Sansone. Giordano went to Las Vegas on November 9;

Zerilli arrived and checked into the Frontier Hotel under an assumed

name on November 10; and Sansone arrived on November 11 to complete

the withdrawal of the $150,000 investment.

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64 United States of America vs.

doubtedly could have found these events tvo interlocked to con-

stitute coincidence” (United States v. White, supra, 394 F.2d at

53); it could have drawn from the events the inferences sug-

gested by the prosecution—that Giordano was brought into the

conspiracy at least as early as June; that he arranged for the

investment of $150,000 in VFI through Sansone; and that the

purpose of Giordano’s five trips to Las Vegas in 1967 was to

watch over this hidden interest in VFI and participate in various

key decisions. There comes a point when the innocent explana-

tion is so much less likely than the culpable one that jurors

properly could decide that a defendant in fact was acting in

furtherance of the conspiracy and shared its illegal purpose. We

believe that point was reached here as to Giordano.

Three legal arguments subsidiary to Giordano’s challenge to

the sufficiency of the evidence should be mentioned.

1. The government called Cusumano and Sansone as witnesses.

Both denied that Giordano was involved in a Cusumano loan to

Sansone. Giordano argues that the government is bound by this

testimony. But the notion that a party is bound by the testimony

of every witness it calls is “long discredited,” Rodgers v. United

States, 402 F.2d 830, 833 (9th Cir. 1968), and is clearly not

the law of this circuit. See eases cited in Rodgers, 402 F.2d at

833, n. 1.

Rodgers dces hold that the government cannot rely on an

inference when the only evidence presented by the government

is inconsistent with the inference the government wishes drawn.

However, Rodgers itself acknowledges that this does not “mean

that in every case where some of the government’s evidence is

arguably contrary to an inference that it wishes to have the jury

draw from other evidence, the inference may not be drawn.” 402

F.2d at 834. See also United States v. Payne, 467 F.2d 828,

831 (5th Cir. 1972). Further, in Rodgers the evidence incon-

sistent with the desired inference was presented by a disinterested

witness and was embodied in an uncontested document. Here,

Cusumano and Sansone were interested witnesses with motives to

dissemble about Giordano’s role, and the prosecution presented a

great deal of other evidence, albeit circumstantial, connecting

Giordano with the loan. It may be reasonable to require the

prosecution to do more than rely on a general inference to

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— A-65 —

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Michael Santo Polizzi, et al. 65

counteract its own uncontested documentary evidence, but an

inference specifically supported by other evidence is not barred

simply because it is inconsistent with testimony of witnesses who

were called by the government but have every reason to protect

the defense.

2. Giordano argues that telephone company records showing

calls between telephone numbers assigned to Giordano and Zerilli

were inadmissible because there was no direct evidence as to who

participated or what was said, citing Laughlin v. United States,

226 F. Supp. 112. » 113 (D.D.C. 1964). But this case held only

that such records were insufficient corroboration in a perjary

case, where “direct and positive evidence of falsity of defendant’s

sworn statement” is required, and “cireumstantial evidence thereof

is insufficient, no matter how persuasive.” 226 F. Supp. at 114.

The Court of Appeals held such records admissible in a con-

spiraey case, distinguishing the district court’s ruling in the

earlier perjury case beeause of the high degree of corroboration

necessary in a perjury case. Laughlin v. United States, 385 F.2d

287, 293 (D.C. Cir. 1967).18

Giordano also contends the government cannot rely upon infer-

ence to establish the contents of the telephone ealls, citing Osborne

v. United States, 371 F.2d 913, 927-29 (9th Cir. 1967). But in

Osborne, each telephone call was the subject of a separate count

charging a separate violation of 18 U.S.C. §1343, “Fraud by wire,

radio, or television.” Proof of the contents of the particular tele-

phone call was therefore crucial to conviction on the particular

count. In the present case, the exact content of each telephone call

is not crucial to conviction; the telephone calls themselves are not

the subject of the charge. Proof of their occurrence, especially their

timing and frequeney, is merely circumstantial evidence tending,

with other circumstantial evidence, to show Giordano’s participa-

tion in the conspiracy.

3. Giordano makes the same contention with respect to proof

regarding his trips to Las Vegas—that no inference can be drawn

from the fact that they occurred—and we reject it for the same

reasons. He also argues that hotel records evidencing his stays at

18In the conspiracy case, there was evidence identifying the parties to

the telephone calls (see 385 F.2d at 293), but the Court of Appeals did

not rest admissibility upon this circumstance.

ee a hn et SPO Nerney

RR TET

— A-66 —

66 United States of America vs.

the Dunes Hotel in Las Vegas in 1967 should not have been admit-

ted because other contemporaneous hotel records were destroyed “in

accordance with routine hotel policy” prior to the return of the

indictment in 1971. The argument is that if the indictment had

been returned earlier the records might have been in existence and

might have contained exculpatory or explanatory evidence demon-

strating that Giordano’s visit had an innocent purpose. Giordano

cites United States v. Marion, 404 U.S. 307 (1971).

The contention is frivolous. The Sixth Amendment does not

apply to pre-indictment delay, 404 U.S. at 313, and Giordano has

not shown that the delay involved here violated the Due Process

Clause. 404 U.S. at 32426. We need not consider, therefore,

whether suppression of evidence would be a proper remedy if a

due process violation had occurred. Cf. Strunk v. United States,

412 U.S. 434 (1973).

DUNIWAY, Circuit Judge:

I concur in the portions of this opinion prepared by Judges

Renfrew and Browning.

XVI. Criminal Liability of Emprise Corporation.

Appellant Emprise Corporation argues that it is not liable for

any criminal acts committed by its predecessor in interest. The

facts are these: Before March 1, 1970, there was a New York cor-

poration called High Park Corporation, which owned all of the

shares of another New York corporation, Emprise Corporation

(Old Emprise). On March 1, 1970, Old Emprise merged into its

parent, High Park Corporation. On March 17, 1970, High Park

Corporation amended its corporate name to Emprise Corporation

(New Emprise).

The February 26, 1971, indictment in this case charged “Em-

prise Corporation” as a defendant. In July, 1971, it became clear

that this meant Old Emprise, and, on September 9, 1971, the dis

trict court dismissed as to Old Emprise for want of personal juris-

diction over it. The government filed an information against New

Emprise. New Emprise moved to dismiss, but this motion was

denied, and New Emprise was convicted of violating 18 U.S.C.

§§371 and 1952 and was fined $10,000. The charged offense was

committed by Old Emprise, before the merger.

PA RE Be oT we LE

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A RE Es OR aD Nee

— A-67 —

Michael Santo Polizzi, et al. 67

The question is whether the surviving corporation of a merger,

here New Emprise, can be held criminally liable for acts com-

mitted by a former subsidiary constituent corporation (Old Em-

prise) which later merged into the survivor.

Appellants argue that in this federal case we must apply federal

law, regardless of what the state law may be, and that under fed-

eral law only the constituent corporation, not the surviving corpo-

ration, can be prosecuted. Of course we apply federal law. That,

however, does not answer the question. Federal courts, in deciding

federal cases, often borrow otherwise applicable state law as the

federal law to be applied in a federal case when doing so is reason-

able and there is no contrary federal policy. Here, Old Emprise

and New Emprise are New York corporations. We can think of no

federal policy that would prohibit our borrowing New York law

in deciding whether New Emprise is liable for a crime committed

by Old Emprise. Neither can appellants, beyond mere assertion.

Under the Constitution, the federal government is not expressly

granted the power to form corporations; it may do so only under

the necessary and proper clause.! See, e.g., McCulloch v. Maryland,

1819, 17 U.S. (4 Wheat.) 316. The result is that nearly all corpo-

rations in the United States are creatures of state law. This also

means that when Federal statutes refer to “corporations” they

necessarily include within that word corporations created under

state law. Some Federal statutes are expressly applicable to state

created corporations. See, e.g., 15 U.S.C. §7; Melrose Distillers v.

United States, 1959, 359 U.S. 271, 272. In this case New Emprise

was convicted of violations of 18 U.S.C. §§371 and 1952. §371

refers to “persons” and §1952 to “[w]hoever.” Under the Federal

Rules of Construction, 1, U.S.C. §1.

“In determining the meaning of any Act of Congress, un-

less the context indicates otherwise—

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the words ‘person’ and ‘whoever’ include corporations ® © ©

as well as individuals;

@ @ e e ss”

The term “corporations” as used in 1 U.S.C. §1 clearly includes

corporations formed under state law. See Alamo Fence Company

10. S. Const. art. I, §8.

— A-68 —

68 United States of America vs.

of Houston v. United States, 5 Cir., 1957, 240 F.2d 179, 181.

Nothing in the contexts of §§371 and 1952 indicates meanings for

the terms “persons” and “whover” other than those of 1 U.S.C.

§1. Therefore, the existence and status of corporations charged

under §§371 and 1952 should be determined by reference to the

law of the state of their incorporation, unless the application of

that law would conflict with federal policy. Cf. Melrose Distillers

v. United States, supra, 359 U.S. at 274. In this case, no such con-

flict exists, and New York law, therefore, will be applied.

Convenience and common sense also point to the adoption of

New York law as the federal law in this case, for the purpose of

determining whether New Emprise is criminally liable. Both Old

and New Emprise are artificial creations, wholly dependent on

New York law for their existence. New York law defines their

powers, rights and liabilities, prescribes their procedures, governs

their continued existence, and defines the terms upon which mer-

gers may occur and the effect to be given to mergers. These corpo-

rations were created under New York law by people, however, and

any penalty imposed on them is, indirectly, a penalty imposed

upon the people who own and control them. If New York law

provides for the imposition of such a penalty for acts for which

those people bear the ultimate responsibility, there is no good

reason for relieving them of the penalty because it arises from

federal law. See Alamo Fence Company of Houston v. United

States, supra, 240 F.2d at 183.

Under modern state corporation laws, a corporation once formed,

in the absence of a provision limiting its juristie life, exists per-

petually unless it is dissolved or its corporate charater is annulled.”

It is often said that the merger of a corporation into another is

similar to the death of an individual, in that all current or future

litigation by or against it is abated except insofar as the state of

2“Neither bankruptcy . . . nor cessation of business . . . nor dispersion

of stockholders, nor the absence of directors . . . nor all combined, will

avail without more to stifile the breath of juristie personality. The cor-

poration abides as an ideal creation, impervious to the shocks of these

temporal vicissitudes. Not even the sequestration of the assets at the

hands of a receiver will terminate its being.” Petrogradsky Mejduna-

rodny Kommerchesky Bank v. Nat’l C

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