The opinion of the court was delivered by: Nickerson, District Judge.
In January, 1990, defendant was charged by superceding
indictment with sixteen counts of RICO, embezzlement, receipt
of unlawful payments, filing a false loan application, mail
fraud, tax evasion, and wilful failure to file his tax return.
The government moves to disqualify his trial counsel Patrick
As charged in the indictment, defendant was a vice president
of Local 452 of the Candy and Confectionery Workers of the
Bakery, Confectionery and Tobacco Workers International Union
(the Local), and served as the administrator for its Pension
and Welfare Funds from January 1982 to October 1986. He was an
officer of a partnership Benefit Management Associates formed
by himself and Frank Salmaggi, another administrator of the
Pension Fund. The partnership was organized to service the
Local's funds. Defendant was also the controlling figure of
Rendezvous Records, which produced and marketed recordings of
Between 1982 and 1987, defendant allegedly conspired with
three others to commit a pattern of racketeering activity in
violation of 18 U.S.C. § 1962. The three alleged
co-conspirators were (1) Frank Salmaggi, (2) Anna Rizzo, the
now-deceased president of the Local, the funds' chairperson of
the board of trustees, and grandmother of the defendant, and
(3) Charles Wallert, Sr., the now-deceased president of the
Local, administrator of the Pension Fund, chairperson of the
Funds, and father of the defendant.
The alleged purpose of the racketeering enterprise was to
enrich defendant and his co-conspirators by embezzling monies
and assets of the funds and by receiving kickbacks from those
seeking to do business with the funds. Defendant is charged
with receiving kickbacks between 1982 and 1984 from several
insurance agents who sought business from the funds and from
Joseph Kaufman who wished to influence selection of an
administrator. The other charged racketeering acts allegedly
occurred in 1985 and 1986.
It is pertinent to this motion that defendant is charged
with obtaining in 1985 through fraud involving the use of the
United States mails a $275,000 mortgage loan from the Freedom
National Bank (the Bank). With the proceeds of the loan,
defendant purchased a $350,000 house in Long Island. He is
also charged with two separate counts that involve this same
loan transaction, the making a false loan application and mail
Wall admits to receiving $10,000 of the proceeds from the
loan for brokering the sale of the Long Island house. However,
he claims not to know any "details" of the loan application,
stating that he only arranged for the defendant to see the
house. The government suggests that Wall may have done more,
such as advising defendant on how to prepare the application.
As evidence of Wall's involvement, the government cites the
application itself listing Wall as "Attorney for Purchaser or
Mortgagor," the Closing Statement noting payment to Wall of
$10,000 as a broker's fee, and the Bank's Loan Settlement
Statement, signed by the defendant, listing the $10,000 paid
as an attorney's fee.
Retaining counsel of choice is "a right of constitutional
dimension." See U.S. v. Arrington, 867 F.2d 122 (2d Cir. 1989),
citing United States v. Wisniewski, 478 F.2d 274, 285 (2d Cir.
1973). However, the right is not absolute. As the Supreme Court
has recently stated, "the essential aim of the [Sixth]
Amendment is to guarantee an effective advocate for each
criminal defendant rather than to ensure that a defendant will
inexorably be represented by the lawyer whom he prefers." See
Wheat v. U.S., 486 U.S. 153, 108 S.Ct. 1692, 1697, 100 L.Ed.2d
140 (1988). While there is a "presumption in favor of counsel
of choice," the courts have "an independent interest in
ensuring that criminal trials are conducted within the ethical
standards of the profession and that legal proceedings appear
fair to all who observe them." Id. Thus, the court must
"balance the defendant's constitutional right against the need
to preserve the highest ethical standards of professional
responsibility." See United States v. Cunningham,
672 F.2d 1064, 1070 (2d Cir. 1982).
Defendant desires to retain Wall as counsel and is willing
to waive any right to claim Wall has a conflict of interest.
Wall has served as defendant's attorney since 1983, has
defended him in, among other matters, a successful appeal of
a criminal conviction, the subsequent retrial, and a civil
lawsuit related to the criminal matter, and is familiar with
the facts of the present case.
The government presents several grounds for disqualifying
Wall as counsel for defendant. It says Wall is a witness
either sworn or unsworn to defendant's alleged fraud on the
Bank. He also formerly represented the co-conspirator
Salmaggi, an important government witness, who will have a
materially adverse interest from the defendant in this case.
Wall is currently representing the partnership of defendant
and Salmaggi as well as Rendezvous Records in a related civil
RICO case which may materially limit Wall's ability to fully
represent the defendant, especially if Salmaggi does not agree
to waive the ...