The opinion of the court was delivered by: MACMAHON
MacMAHON, District Judge.
Defendants, indicted for violations of the income tax laws,
move to suppress evidence obtained by the Internal Revenue Service (IRS) from the New York Organized Crime Task Force (OCTF). Decision of the motions requires familiarity with the following factual background.
A sewer district was created in the Town of Fleming, Cayuga County, New York, in February 1969. Bids initially received for the construction of the sewer were in excess of authorization. Second call for bids was, therefore, issued by the Town, and a contract was granted on the second bid to Kenneth C. Marshall, d/b/a J & K Pipe Company. Marshall later filed an assumed name certificate of Ron-Ore Soil Systems, which was then incorporated under the name of Ron-Ore Soil Systems, Ltd. (Ron-Ore) in December 1970. Defendant, Frank Cedrone, was project manager for the construction. In August 1972, Ron-Ore was removed from the project, at which time an alleged forged performance bond was discovered. Subsequently, OCTF commenced an investigation, pursuant to New York Executive Law § 70-a (18 McKinney), in March 1973. Subpoenas and subpoenas duces tecum were issued to defendants and others.
The government asserts that OCTF obtained the following types of evidence pertaining to defendants:
1. Records obtained from banking institutions pertaining to accounts of defendants;
2. Records obtained from banking institutions pertaining to accounts of corporate depositors;
3. Records obtained from corporations, towns, counties and the state;
4. Corporate, town, county and state records obtained from defendants.
5. Testimony under oath by defendants, Frank Cedrone, Lenora Cedrone and Dominick Galoni, in response to questions asked by an OCTF Assistant Attorney General. Defendant Pastore refused to submit to an oral examination.
As a result of this investigation, state indictments were returned against Ron-Ore, defendant Frank Cedrone, defendant Galoni and others. However, Judge Aloi of the New York Supreme Court, Onondaga County, dismissed the indictments, People v. Ron-Ore Soil Systems, Ltd., 81 Misc.2d 121, 364 N.Y.S.2d 310 (1975), on the ground that Executive Law § 70-a was unconstitutionally vague for failing to define the term "organized crime" and held the statute invalid on its face and as applied. An appeal from that decision is presently pending in the New York courts.
The government concedes that a sizable amount of evidence was obtained by the IRS from OCTF. The question here is whether such evidence is admissible in this federal prosecution. Defendants have requested that we also declare Executive Law § 70-a unconstitutional. However, in view of the proper pendency of that question in the New York state courts and our conclusion that such a decision is unnecessary to the resolution of the issue before us, we refrain from consideration of the statute's constitutionality. Instead, we shall assume, without deciding, that § 70-a is unconstitutional and that the OCTF was without authority to conduct the investigation or to issue subpoenas.
In former days, all evidence obtained by state officials was admissible in federal prosecutions, regardless of the manner by which it was obtained, under the so-called "silver-platter" doctrine. That doctrine, however, has long been discredited. Whether evidence obtained by state officials must be suppressed in a federal prosecution is a question for the federal court to decide, and state officials are held to the same requirements of constitutional regularity as federal officials.
Defendants contend that the investigation by OTCF violated their constitutional rights under the fourth and fifth amendments. The government counters by asserting that defendants lack standing to object to some of the evidence and waived their rights as to the rest. Our analysis of the issues ...