and the acquisition of a shipyard in Michigan, when in fact
Wallach did little if any work on either of these projects.
Similarly, the jury found that London had submitted false
invoices to Wedtech to disguise the true nature of his work:
stock manipulation and funneling secret payments to Chinn. The
jury further found that Chinn, a member of the Wedtech board
of directors, improperly shared in the funds Wedtech had
disbursed to London, and had charged substantial personal
expenses to his Wedtech credit cards, a fraud on Wedtech and
the Internal Revenue Service.
Through these fraudulent practices, the jury found that each
of the defendants violated the Racketeer Influenced and
Corrupt Organizations Act (RICO), that London and Chinn had
conspired to commit these violations, and that each defendant
committed corresponding substantive violations of the law. On
October 16, 1989, defendant Wallach was sentenced to a term of
imprisonment of six years, defendant London to five years, and
defendant Chinn to three years, with forfeitures of the
illegal gains to follow.
Before me is a motion by the defendants for a new trial
because of the post-trial disclosure by the government*fn1
that Anthony Guariglia, a major government witness at trial,
breached his plea agreement with the government*fn2 by
gambling in Puerto Rico in November, 1988 and thereafter
perjured himself at the trial by denying any such
gambling.*fn3 The defendants' appeals of their convictions
being before the Second Circuit at the time of these
disclosures, that Court remanded the case for proceedings
appropriate for the resolution of the motions.
Whether subsequent discovery of perjury necessitates a new
trial depends on the materiality of the perjury to the jury's
verdict, and on the culpability, if any, of the government in
its use. The more culpable the government, the less the
defendant must show material impact on the jury. For instance,
if the government knowingly introduces perjured testimony, then
a grant of a new trial motion is "virtually automatic," that
is, any probability that the perjured testimony might have
influenced the jury's verdict will require a new trial. U.S. v.
Stofsky, 527 F.2d 237, 243 (2d Cir. 1975); see Sanders v.
Sullivan, 863 F.2d 218, 225 (2d Cir. 1988), on remand, 1989 WL
97844, 1989 U.S.Dist.Lexis 9534 (S.D.N.Y. August 15, 1989).
However, if the government is unaware of perjured testimony
at trial, then a new trial is required only if the new
evidence goes to an issue that is "so material that it would
`probably' cause a result of acquittal upon retrial."
Sanders v. Sullivan, 863 F.2d at 225 (citations omitted).
Perjured testimony will meet this "extraordinary" standard only
if it "leave[s] the court with the firm belief that but for the
perjured testimony, the defendant would most likely not have
been convicted," or if "`its suppression undermines confidence
in the outcome of the trial.'" Sanders v. Sullivan, 863 F.2d at
226 (citing United States v. Agurs, 427 U.S. 97, 109-10, 96
S.Ct. 2392, 2400, 49 L.Ed.2d 342 (1976)).
However, where the subsequently discovered perjury concerns
the witness's credibility alone, including the witness's
compliance with a plea agreement, and the perjury is merely
"additional evidence tending to further impeach the credibility
of a witness whose character has already been shown to be
questionable," then it is unlikely that the jury would have
acquitted on this basis. United States v. Gilbert, 668 F.2d 94,
96 (2d Cir. 1981).
There is in this case neither allegation nor evidence that
the prosecution had any knowledge as to Guariglia's
now-disclosed perjury, so that a hearing on this issue is
unnecessary. The defendants have not contradicted with
anything but "unsupported speculation" Assistant United States
Attorney Baruch Weiss' account of the government's post-trial
discovery of the perjury. Upon its discovery of the perjury,
the government came forward to disclose what it had learned,
and is proceeding against Guariglia. When, during the trial,
the defendants cross-examined Guariglia about evidence that he
had improperly gambled in Atlantic City, the government
independently and thoroughly interviewed Guariglia's
companions on that foray and were given confirmation of
Guariglia's explanation that he had merely taken out "markers"
for others.*fn4 The defendants' argument, also made to the
jury at the trial, that Guariglia's explanation for apparent
continued gambling was incredible, is insufficient to raise an
issue of fact as to the government's knowledge of Guariglia's
perjury. Without such a fact issue, no hearing is required.
United States v. Gilbert, 668 F.2d at 96.
In the absence of any disputed issue of fact, it remains
only to determine as a matter of law whether the concededly
perjured testimony was so material that the jury probably
would have acquitted the defendants had it known that
Guariglia lied about his continued gambling or about his
profit skimming. I have not the slightest question that this
additional brace of wrongdoings, if known to the jury, would
not in any way have had the slightest effect upon its verdict.
The testimony was not material: Guariglia's gambling and
skimming did not bear on the defendants' guilt or innocence,
only on Guariglia's credibility. And here, these instances of
falsehood would have been merely minor, cumulative additions
to the massive mound of discredit heaped upon Guariglia over
several days of both direct and cross-examination. The jury
heard that Guariglia's past included: bribery of numerous
government officials, including Congressman Biaggi and Garcia,
Richard D. Ramirez of the Navy, Gordon Osgood of the Army,
Jerry-doe Smith of the Postal Service, Peter Neglia of the
Small Business Administration and Vito Castellano of the
National Guard; commercial bribes to bank officials and a Con
Edison employee; countless false filings with the Securities
and Exchange Commission, the Small Business Administration and
the Internal Revenue Service; the use of kickbacks, frauds and
the use of the "FHJ slush fund" to steal $1,624,702 from
Wedtech; the payment of over $500,000 in illegal payoffs to
union officials for labor peace; the fabrication of a Navy
telex to inflate Wedtech's apparent profit; concealing
ill-gotten gains in nine foreign bank accounts; false
statements to District Attorney Morgenthau and his staff when
the investigation began, and, during the course of the
investigation, obtaining a false Swedish passport. The
also brought out post-cooperation wrongdoing in connection
with tax irregularities, arguable continued gambling in
Atlantic City, and continued failure to make restitution to
the Wedtech shareholders; thus, when they argue that the
Puerto Rico gambling uniquely provided evidence of
post-cooperation wrongdoing, which they had desperately sought
to show at trial, the defendants overstate the value of this
evidence. Accordingly, the additional incidents of dishonesty
discovered since the trial could in no way have altered the
jury's perception of the witness. See United States v. Gilbert,
668 F.2d at 96 (citing United States v. Rosner, 516 F.2d 269,
273-74 (2d Cir. 1975)).
It is also appropriate to note that the jury's verdict
showed that it clearly appreciated Guariglia's blackened past,
making it highly unlikely that any further, relatively minor
instances of discredit would have influenced their verdict.
Although the jury convicted the defendants on many counts, it
distinguished and acquitted on those counts in which the
testimony of Guariglia and Mario Moreno, another
well-impeached Wedtech officer, was uncorroborated by
substantial independent evidence of the defendants' guilt,
including documents, admissions and other witnesses. For
instance, the jury acquitted London and Chinn on Counts Eight
and Nine, which charged these defendants with having accepted
a $240,000 commercial bribe in exchange for Chinn's vote in
favor of certain benefit packages for Guariglia and Moreno.
Because there was no corroboration of the payment, the jury
did not accept the prosecution witnesses' word alone, and
acquitted. See Gilbert, 668 F.2d at 97. On the other hand, the
jury did find the defendants guilty on those charges that were
corroborated by many unimpeached, independent witnesses, and by
a clear, extensive trail of documents, cancelled checks, and,
in certain cases, incriminating statements by the defendants
Accordingly, there is no need for a hearing, and, as
Guariglia's perjury was about a collateral, non-material
matter, and would not in any event have had the slightest
influence on the jury's verdict, the motions for a new trial