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United States v. Zingaro

decided: September 21, 1988.

UNITED STATES OF AMERICA, APPELLEE,
v.
JOSEPH ZINGARO, APPELLANT



Appeal from a judgment of the United States District Court for the Eastern District of New York, Jack B. Weinstein, (then) Chief Judge, convicting appellant, after a jury trial, of one count of RICO conspiracy. Appellant argues that the admission of evidence concerning a loan not connected to the Yonkers gambling clubs described in the indictment amounted to a constructive amendment of the indictment, in violation of the grand jury clause of the fifth amendment. Reversed and remanded.

Van Graafeiland, Meskill and Mahoney, Circuit Judges.

Author: Mahoney

MAHONEY, Circuit Judge:

Joseph Zingaro appeals from a judgment of the United States District Court for the Eastern District of New York, Jack B. Weinstein, (then) Chief Judge, convicting him after a jury trial of one count of RICO conspiracy in violation of 18 U.S.C. § 1962(d) (1982). On appeal, Zingaro contends that the trial court's admission of evidence concerning a loan not specified in the indictment allowed the jury to find predicate acts of loansharking and unlawful debt collection that were not embraced by the specific charges of the indictment, thus constituting a constructive amendment of the indictment in violation of the grand jury clause of the fifth amendment. Agreeing, we reverse and remand.

Background

Zingaro was charged in a superseding indictment with one count of RICO conspiracy, 18 U.S.C. § 1962(d) (1982), and two substantive counts of conducting an illegal gambling business, 18 U.S.C. § 1955 (1982). The RICO enterprise was alleged to be the "Gambino Crime Family . . .[,] a secret criminal organization which operated within the Eastern District of New York and elsewhere." The RICO conspiracy count generally charged Zingaro with conspiring to conduct the affairs of the Gambino family by agreeing "to the commission of multiple acts of extortionate extension and collection of credit and the operation of illegal gambling businesses."

The part of the massive indictment*fn1 that alleged Zingaro's particular violations specified four categories of predicate racketeering acts: (1) extortionate extension of credit, 18 U.S.C. § 892 (1982); (2) extortionate collection of credit, 18 U.S.C. § 894 (1982); (3) operation of a sports betting business illegal under New York law, 18 U.S.C. § 1955 (1982); and (4) operation of a card game and "Zigonett" game business illegal under New York law, 18 U.S.C. § 1955. The RICO conspiracy count also charged Zingaro with conspiring, in violation of 18 U.S.C. § 1962(d) (1982), to conduct Gambino family affairs by the collection of unlawful debt. See 18 U.S.C. §§ 1961(6) (1982) (defining "unlawful debt") and 1962(c) (1982) (providing as alternative bases of criminal liability the conduct of the affairs of a RICO enterprise either "through a pattern of racketeering activity," i.e., two or more acts of racketeering activity, or through "collection of unlawful debt"). The indictment detailed Zingaro's alleged involvement in Yonkers "social clubs," which offered card games and a "Zigonett" game to players, as well as extortionate loans to cover the players' gambling losses, as the basis both for the predicate racketeering acts and the collection of unlawful debt.

At trial, the government introduced evidence, primarily through the testimony of a cooperating coconspirator, Basil Cannata, that Zingaro was the "skipper" of a loansharking-gambling operation conducted in two clubs in Yonkers, the "Feathers" and "Maple Hill" social clubs. Cannata testified that he ran these operations, but that Zingaro and another coconspirator, Frank Mastricova, received a portion of the profits and provided loan money.

The government also elicited testimony from Cannata concerning a $50,000 loan made by Zingaro, Mastricova and Cannata to someone identified as "George the Greek." There was no evidence that this loan was in any way connected to the Yonkers social clubs and gambling operations. Rather, the loan was sought solely for the purpose of renovating George the Greek's diner in the Bronx. The government corroborated Cannata's testimony that the funds for the loan came from Zingaro and one "Rogie" by introducing Mastricova's address book, which included the notations "Rogie 16000" and "Joe Z. 20000." An F.B.I. expert witness testified that these notations were accounts of extortionate credit transactions.

Defense counsel conceded that the evidence concerning the loan to George the Greek was admissible for the limited purpose of establishing the existence of the enterprise and demonstrating Zingaro's role in it. Defense counsel contended, however, that the evidence was not admissible as an independent basis for the jury to find loansharking or the collection of unlawful debt. Arguing that the indictment was narrowly drawn to charge only loansharking and unlawful debt collection related to the business of the Yonkers gambling clubs, counsel timely requested a limiting instruction.*fn2 The district court denied this request on the ground that the indictment was not so narrowly drawn.

In summation, the government recounted in detail the circumstances of the "George the Greek" loan, and emphasized that Zingaro was "the source," "the director of the operation," and "got a piece of the action" with respect to that loan.*fn3 Defense counsel thereafter renewed the request for a limiting instruction concerning the "George the Greek" evidence. The request was again denied, and the case was submitted to the jury. During its deliberations, the jury requested a transcript of the F.B.I. agent's testimony concerning the notations in Mastricova's address book.

When the jury returned its verdict, they found Zingaro not guilty on the two substantive gambling business counts, which corresponded to the two gambling business predicate acts of the RICO conspiracy count. The jury found Zingaro guilty, however, on the RICO conspiracy count, which required a finding that Zingaro agreed either to commit at least two predicate acts of racketeering (i.e., a pattern of racketeering activity), or to engage in the collection of unlawful debt. See 18 U.S.C. § 1962(d) and (c) (1982). Their verdict indicated the following: predicate act number one (extortionate extensions of credit)--proven; predicate act number two (extortionate collections of credit)--deadlocked; predicate act number three (sports betting business)--not proven; predicate act number four (social club gambling business)--deadlocked; collection of unlawful debt proven.

The district court then instructed the jury to resume deliberations concerning the predicate acts (two and four) as to which it was deadlocked. The court also instructed the jury that it should specify whether it had found only one unlawful debt collection or more than one.*fn4 The government successfully opposed defense counsel's request that the jury be instructed to specify further which debt it had found, i.e., whether it was the "George the Greek" debt.

The jury returned again with a supplemental verdict finding predicate act number two (extortionate collections of credit) proven, but predicate act number four (social club gambling business) not proven. Having found both the extortionate extension of credit and the extortionate collection of credit predicates to have been proven, the jury also indicated that the government had proven collection of only one unlawful debt. After polling the jury, the district court accepted its verdict and discharged the jury.

Zingaro was sentenced to five years in prison, a $250,000 fine and a $50 special assessment. Immediately after announcing the sentence, however, the district court granted Zingaro bail pending appeal, "[i]n view of the fact that there are very serious problems here with respect to the validity of the conviction." This appeal followed.

Discussion

The issue on appeal is the effect of the admission of the "George the Greek" loan evidence, without any limiting instruction, despite the fact that the indictment nowhere mentions this loan or specifies (as to Zingaro) any loans made to victims not associated with the Yonkers social clubs. More specifically, the issue is whether submission of the "George the Greek" loan to the jury as a basis upon which Zingaro could be convicted for RICO conspiracy constituted a constructive amendment of the indictment or merely a variance in proof at trial. ...


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