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U.S. v. PACCIONE

August 13, 1990

UNITED STATES OF AMERICA,
v.
ANGELO PACCIONE, ANTHONY VULPIS, JOHN MCDONALD, A & A LAND DEVELOPMENT, AUGUST RECYCLING, INC., NATIONAL CARTING, INC., STAGE CARTING, INC., NEW YORK ENVIRONMENTAL CONTRACTORS, INC., ROSEDALE CARTING, INC., AND VULPIS BROTHERS, LTD., DEFENDANTS.



The opinion of the court was delivered by: Motley, District Judge.

    OPINION

On May 8, 1990, the Government rested its case. Defendants then moved for a judgment of acquittal on all counts pursuant to Fed.R.Crim.P. 29(a). After hearing the arguments of counsel on May 8, 1990, the court orally denied defendants' motions for a judgment of acquittal on all counts with Opinion to follow. This Opinion sets forth the court's reasons for its ruling. It also sets forth the court's finding — pursuant to United States v. Geaney, 417 F.2d 1116 (2d Cir. 1969), cert. denied, 397 U.S. 1028, 90 S.Ct. 1276, 25 L.Ed.2d 539 (1970) — with respect to the use of co-conspirator statements as evidence against each defendant.

DISCUSSION

In order to withstand a defendant's motion for a judgment of acquittal on a particular count charged in an indictment, the Government must have introduced evidence in its direct case "upon which a reasonable mind might fairly conclude guilt beyond a reasonable doubt" on each and every element of the charged offense. United States v. Mariani, 725 F.2d 862, 865 (2d Cir. 1984).

The Government must also show, by a preponderance of the evidence, that the defendant knowingly and wilfully became a member of and participated in the conspiracy charged in the indictment in order to permit co-conspirator statements to be used as proof against a particular defendant pursuant to Fed.R.Evid. 801(d)(2)(E). United States v. Geaney, 417 F.2d 1116 (2d Cir. 1969), cert. denied, 397 U.S. 1028, 90 S.Ct. 1276, 25 L.Ed.2d 539 (1970). "[A] court, in making a preliminary factual determination under Rule 801(d)(2)(E), may examine the hearsay statements sought to be admitted." Bourjaily v. United States, 483 U.S. 171, 181, 107 S.Ct. 2775, 2782, 97 L.Ed.2d 144 (1987). The court is permitted "to evaluate these statements for their evidentiary worth as revealed by the particular circumstances of the case." Id. at 180, 107 S.Ct. at 2781.

On the basis of the evidence outlined in this Opinion, the court finds that the Government introduced sufficient evidence in its direct case upon which a reasonable jury could find each defendant's guilt beyond a reasonable doubt as to each count charged in the indictment.*fn1 These same facts are also sufficient to show that the defendants unlawfully, knowingly and wilfully participated in the RICO conspiracy charged in Count Two of the indictment.

When the indictment charges an offense as both a racketeering act and a substantive count, the court will discuss each of these concurrently. The court now sets out the Government's evidence introduced at trial supporting each charge alleged in the indictment.

I. COUNT I — RICO

Count One of the indictment charges each defendant with unlawfully, wilfully, and knowingly conducting and participating in the affairs of a racketeering enterprise through a pattern of racketeering activity including mail and wire fraud in violation of 18 U.S.C. § 1962(c). In order to prove that a defendant is guilty of RICO as charged in Count One, the Government must establish, beyond a reasonable doubt, each of the following essential elements of the crime: (1) that an enterprise as alleged in the indictment exists; (2) that the enterprise affected interstate or foreign commerce; (3) that the defendant was associated with or employed by the enterprise; (4) that the defendant unlawfully, wilfully, and knowingly engaged in a pattern of racketeering activity by committing, or aiding and abetting the commission of, at least two acts of racketeering; and (5) that the defendant conducted or participated in the conduct of the enterprise's affairs through that pattern of racketeering activity.

a.  Existence of the Enterprise/Effect on Interstate Commerce

The court acknowledges that the first two elements of a RICO offense that the Government must establish beyond a reasonable doubt apply generally to each defendant: the existence of the enterprise as defined by the RICO statute, 18 U.S.C. § 1961(4), and the effect of that enterprise on interstate or foreign commerce.

According to the RICO statute, any "group of individuals [who are] associated in fact although not a legal entity" may constitute an "enterprise." 18 U.S.C. § 1961(4). This includes an enterprise which consists of individuals, corporations, and partnerships as alleged in the indictment. United States v. Paccione, 738 F. Supp. 691 (S.D.N.Y. 1990), citing United States v. Huber, 603 F.2d 387, 393-94 (2d Cir. 1979), cert. denied, 445 U.S. 927, 100 S.Ct. 1312, 63 L.Ed.2d 759 (1980) (group of corporations constituted "association in fact" enterprise). In addition, a single entity can be both a RICO "person" and one of the members of the RICO "enterprise." Cullen v. Margiotta, 811 F.2d 698, 729-30 (2d Cir.), cert. denied, 483 U.S. 1021, 107 S.Ct. 3266, 97 L.Ed.2d 764 (1987). The fact that the entities named in the indictment as "persons" are alleged to be constituent members of the same enterprise does not invalidate the RICO counts. United States v. Paccione, 738 F. Supp. 691 (S.D.N.Y. 1990).

Proof as to the existence of the enterprise charged in the indictment would include facts showing the defendants to be part of an ongoing organization, formal or informal, and that the enterprise functions as a continuing operation with a core of personnel who function as a continuing unit. United States v. Turkette, 452 U.S. 576, 101 S.Ct. 2524, 69 L.Ed.2d 246 (1981); see also, U.S. v. Indelicato, 865 F.2d 1370 (2d Cir. 1989) (en banc), cert. denied, ___ U.S. ___, 110 S.Ct. 56, 107 L.Ed.2d 24 (1989).

The indictment charges that the defendants were part of a racketeering enterprise whose purposes included the enrichment of the individual defendants and their affiliated partnership and corporations through the operation of an illegal landfill and the disposal of waste materials in violation of federal, state, and local law. In pursuit of its goal, the indictment charges that the enterprise engaged in various illegal activities including avoiding federal, state, and city regulations relating to the operation of a landfill and the disposal of waste materials, and defrauding New York State and City of licenses, licensing fees, and dumping fees. In addition, the indictment charges that the enterprise defrauded generators of medical waste by charging them the rates required for the lawful transfer, storage, and disposal of such waste which was higher than the rates actually incurred by transferring, storing, and disposing of the waste unlawfully. In doing so, the indictment alleges, the enterprise exposed these waste generators to potential civil and criminal penalties.

The existence of the alleged enterprise is supported by testimony of government officials who had dealings with defendants Paccione and Vulpis, acting on behalf of the partnership and corporate defendants, as well as the testimony of a government investigator who observed the operations of the defendants.

Allison Lewis-Smith, an official at the New York City Department of Sanitation ("DOS") whose responsibilities included issuing letters of acknowledgement for clean fill grading operations, testified that defendants Paccione and Vulpis filed an application for a clean fill grading permit in April 1988 on behalf of defendant A & A Land Development, a partnership which was equally owned by Paccione and Vulpis. Lewis-Smith issued a letter of acknowledgement to A & A Land Development for a clean fill grading operation on a parcel of land owned by Kenneth I. Wilpon as Agent, Inc. However, according to the testimony of numerous Government witnesses, Paccione and Vulpis instead used this permit for the disposal of waste on the property owned by CSX Transportation, Inc.

In addition, there was evidence that Paccione and Vulpis, also on behalf of A & A Land Development, caused permits to be issued by the Department of Transportation ("DOT"). Lynn Fealy, permit supervisor at the DOT, testified that Vulpis submitted several applications for street opening permits which showed the purpose of the permit as placing fill. These street opening permits were approved and issued to Vulpis, Paccione, and A & A Land Development. Again, according to numerous Government witnesses, the defendants used these street opening permits in the operation of the landfill.

Evidence that the defendants August Recycling, Inc. ("August"), National Carting, Inc. ("National"), Stage Carting, Inc. ("Stage"), Rosedale Carting, Inc. ("Rosedale"), and Vulpis Brothers, Ltd. ("Vulpis Brothers") were also members of the enterprise can be found in testimony that these companies disposed of waste materials at the A & A landfill site. It is undisputed that August, National, and Stage are owned by Angelo Paccione and that Anthony Vulpis is a co-owner of Rosedale and Vulpis Brothers. Peter Lizzio, an investigator of environmental crimes for the New York City Department of Investigations, testified that during his surveillance of the Arlington Yard site from May 1988 to September 1988, he regularly observed numerous trucks belonging to these defendant corporations dumping at the landfill. The videotapes and photographs taken by Lizzio's team support his testimony.

The existence of the enterprise is further supported by evidence of the working relationship between the defendant companies of Paccione and Vulpis. For example, while Coney Island Hospital entered into an agreement with National, one of Paccione's companies, to have their medical waste removed, the delivery receipts introduced into evidence indicate that Rosedale, one of Vulpis' companies, was the actual shipper of the waste.

The evidence outlined above is sufficient to support an inference that the defendants Paccione and Vulpis and their affiliated defendant partnership and corporations were in fact associated as an ongoing enterprise with a common purpose shown by a continuing operation and core of personnel.

As to the effect of the enterprise's activities on interstate commerce, the Government has introduced evidence that there were numerous phone calls and letters from defendants Paccione, Vulpis and Weiss on behalf of A & A Land Development to representatives of CSX Realty Corporation, a company which conducts business nationwide, while these representatives were in the CSX Realty offices in Richmond, Virginia. As a result of these correspondences, the CSX representatives took a number of flights from their base office in Virginia to Newark Airport in New Jersey, where they were then brought to the Staten Island landfill site to discuss matters affecting CSX business. According to the evidence in support of racketeering acts 3d and 4a-i, discussed below, the enterprise schemed to defraud CSX Transportation, a company headquartered in Florida, of the value of its New York property.

Moreover, in a tape recorded meeting with Allison Lewis-Smith of the DOS, Paccione said that the defendants were transporting the medical waste they picked up from generators to a facility in South Carolina. However, the testimony of numerous Government witnesses indicates that most of the waste was never transported to this facility. Instead, according to those witnesses, the defendants transported the waste to other locations, including the Staten Island landfill.

The remaining elements of a RICO offense — association with or employment by the enterprise; knowing, wilful and unlawful commission of a pattern of racketeering activity; and participation in the conduct of the enterprise's affairs through that pattern of racketeering activity — requires specific application as to each defendant.

b.  Association with the Enterprise

The evidence set forth in this Opinion concerning the existence of the enterprise and the defendants' participation in it is also sufficient to support the inference that each of the defendants was aware of the existence of the criminal enterprise, was associated with and employed by the enterprise, and knowingly and intentionally participated in the enterprise's illegal activities.

c.  Pattern of Racketeering Activity

The fourth element of a RICO offense which the Government must prove beyond a reasonable doubt is that a defendant unlawfully, wilfully, and knowingly engaged in a pattern of racketeering activity with the intention of furthering the goals of the enterprise. This is achieved by committing or aiding and abetting the commission of at least two acts of racketeering by common participants, victims, methods, purposes, or results and demonstrating a threat of continued racketeering activity, if not continuity in fact. H.J. Inc. v. Northwestern Bell Telephone Co., 492 U.S. ___, 109 S.Ct. 2893, 106 L.Ed.2d 195 (1989); see also, United States v. Indelicato, 865 F.2d 1370, 1382 (2d Cir. 1989) (en banc), cert. denied, ___ U.S. ___, 110 S.Ct. 56, 107 L.Ed.2d 24 (1989).

The racketeering acts charged in the indictment all involve violations of either mail fraud or wire fraud on the part of the defendants. The statute that establishes the mail fraud offenses charged in Counts 3-12 and Racketeering Acts 1(a-e), 2, 3(a-e), 4(a-c), 5-11, 12(a-c), and 13-17 of the ...


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