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United States v. Provenzano

decided: May 8, 1980.



Before Rosenn, Garth and Sloviter, Circuit Judges.

Author: Garth


In these consolidated appeals we are presented with challenges on numerous grounds to the convictions of Anthony Provenzano, Thomas Andretta, and Stephen Andretta under the Racketeer Influenced and Corrupt Organization Act (RICO), 18 U.S.C. § 1962.*fn1 The defendants*fn2 were convicted by a jury at a joint trial of conspiracy to violate RICO and of substantive violations, and were sentenced to prison terms and fined.*fn3 We have determined that the district court made no errors at trial which would warrant reversal, and we therefore affirm the judgment of the district court in all five appeals. In this opinion we will discuss briefly our resolution of the appellants' chief objections to the conduct of their trial.


The facts of this case, as alleged in the indictment and found by the jury, revolve around a fairly complex labor kickback scenario. The Government's theory*fn4 is as follows:

Provenzano led a group consisting of himself, Thomas Andretta, Stephen Andretta, Gabriel Briguglio, and others, including Ralph Picardo, who was the Government's chief witness at trial. The group's aim was to extort money from trucking companies in return for "labor peace," inasmuch as Provenzano was allegedly able to control the International Brotherhood of Teamsters Union in New Jersey. The target in this case was a trucking company named Interocean Services, Inc. (Interocean), and later a successor company known as Di-Jub Leasing Corporation (Di-Jub). These companies were "in house" truckers for Seatrain Lines, Inc. (Seatrain), a large shipping company which shipped containerized freight that was ultimately trucked to its final destination.

Picardo had once been a truck driver and Teamsters member. Sometime after 1969, at Provenzano's direction, he switched to management and became a trucking manager, so that he could enable Provenzano, a Teamsters Union official, to be paid secretly for influencing union actions, in violation of 29 U.S.C. § 186.*fn5

Picardo went to work for Seatrain. In 1969, Seatrain owned Interocean, which in turn owned Switching, Inc. Interocean, under Interstate Commerce Commission authority, did all necessary long-distance trucking for Seatrain; and Switching, not under ICC regulation, moved containers at or near Seatrain's piers. Interocean, many of whose officers had come from Seatrain, was not unionized, while Switching had a Teamsters Union contract.*fn6

Sometime thereafter Picardo negotiated the "labor peace" deal with Interocean, specifically with Raymond Rosen, Interocean's vice-president. Picardo, the "front man" now operating a company, Cargo Truck Leasing (Cargo), supplied trucks and owner-operator drivers to Interocean, thus enabling Interocean to avoid unionization and union obligations. In return, Interocean allowed Cargo to collect from Interocean for ghost drivers, i. e., Cargo collected extra money for nonexistent truck drivers who, of course, never performed work. This money was funneled to Picardo and his "associates," as he referred to the appellants at trial.

Among the actions charged by the Government, appellants ensured Picardo's continued dealings with Interocean (though Interocean feared Picardo would hijack its trucks) by threatening labor disruptions, and appellants extorted more money from Interocean in return for preventing the Longshoremen's Union from disputing the Teamsters Union's jurisdiction over movement of trucks within and around Seatrain's pier facilities. To guarantee Cargo's supply of drivers, appellants used their influence at Teamsters Local 560 in Union City, New Jersey, to send drivers to Cargo, where the drivers received low wages and no benefits, instead of sending them to union-organized terminals.

The illegally obtained money was distributed in various ways: checks to fictitious payees, chits, drawings on petty cash, salaries to a no-show worker, and fees for upkeep of horses of some of appellants' relatives. It was distributed either at a bar or at Local 560 in four shares: one-quarter to Provenzano and his brothers; one-quarter to Briguglio and his brothers; one-quarter to Thomas Andretta and Armand Faugno, who cashed checks; and one-quarter to Picardo. When Faugno "disappeared" in 1972, Stephen Andretta took his place and collected the monies previously paid to Faugno.

Overt links with Provenzano occurred in 1972 or 1973, when Picardo told him the details of the scheme and Provenzano complimented Picardo on it (A1072-73), and when Picardo personally delivered cash to Provenzano in August 1974 (A1073-74, A1297, A1323-37).

The group next acquired control of Lift-Van Transport, a certified common carrier, and attempted to phase out Interocean and replace it with Lift-Van. Through appellants' influence, Lift-Van was able to refuse to renew its union contract and fire all union employees. When Picardo, Lift-Van's front man, was jailed for murder in 1975, his cohorts persuaded him to sell Lift-Van.

Appellants later set up the FLT Corporation to replace Cargo. Thomas Andretta, who ostensibly ran FLT, was in prison at all relevant times.

The dispatchers of Interocean who knew of the ghosting scheme were paid to add the names of the "ghosts" and to keep quiet.*fn7 When an Interocean auditor discovered a salary being paid to a no-show employee, he was told by Rosen and the employee it was not his business. When the auditor discovered the ghosting scheme, Rosen told him the false billings were just overcharges, which Cargo would be asked to repay. The scheme was uncovered when Picardo agreed to cooperate with the Government.


These appeals present fifteen issues, some of which are raised by all appellants, and some of which affect only one of the three.

A. Issues Common to All Appellants

1. RICO or Larceny?

Appellants assert that there was a variance between the indictment and the proofs at trial, i. e. that the indictment charged a RICO violation, while the proof showed only larceny. A RICO violation required proof that Interocean, or later Di-Jub, bribed members of appellants' group in order to secure labor peace. These bribes constitute the racketeering required by the RICO Act, 18 U.S.C. § 1962,*fn8 because these debts are unlawful under 29 U.S.C. § 186. Proof of bribery requires knowledge on the part of the party giving the bribe. The appellants contend that the Government failed to prove that anyone at Interocean or Di-Jub knew of Picardo's and Cargo's ghosting scheme, and therefore at best the Government proved that Picardo, who asserted that he was getting money to provide labor peace, was actually just stealing from Interocean.

Appellants point to testimony of Rosen, Interocean's vice-president, to the effect that he did not know of Picardo's ghosting operations (A2217, A2295).*fn9 In addition, two Interocean dispatchers testified to receiving bribes from Picardo; only one, however, said that he suspected that the purpose for the bribe was that he conceal the ghosting from his Interocean superiors (A1883). The auditor who discovered the ghosting testified that Rosen told him Cargo would have to pay back the overcharges and that in fact Cargo did pay them back (A1945).

On the other hand, Picardo testified to conversations with Rosen, during which he claimed to have discussed the specifics of the scheme with Rosen (A1004, A1029, A1039-40). Picardo also testified that the payments were made (A1052). In addition, Rosen's telling the auditor that the discrepancies were none of his business (A1935-36) and a memorandum revealing that Interocean had to guarantee money for labor peace (A2117-18) both support the Government's theory. With respect to the bribes paid by Picardo to the dispatchers, Alan Abramowitz, an employee of Picardo at Cargo, testified that he never told anyone the money had been paid to keep the dispatchers quiet, but he then admitted, upon being confronted with a writing, that he had once told an FBI agent that he believed that the monies had been paid for this purpose (A1853). He never specified from whom the secret was to be kept. Both dispatchers testified they were paid to add the "ghosts" to the list (A1863, A1881). Only one ambivalently suggested that he was paid not to tell his superiors (A1883). In any event, even if Rosen knew of the scheme, Picardo could reasonably have bribed the dispatchers to keep quiet and not spread the word to anyone, so as to conceal from them Rosen's knowledge and thereby avoid the dispatchers' knowing of and revealing the extent of the scheme.

The jury apparently believed Picardo's testimony that he had informed Rosen of the scheme and that Rosen, on behalf of Interocean, bribed Picardo's group, thus involving the group in a RICO violation. Under the applicable standard of review, see, e. g., United States v. Hamilton, 457 F.2d 95, 98-99 (3d Cir. 1972), this jury verdict of guilty must stand because there was sufficient evidence for the jury to find beyond a reasonable doubt that Rosen had knowledge of the scheme and bribed Picardo's group. Thus, there was properly proved a valid RICO-type violation, as opposed to mere grand larceny.

2. "Enterprise"

Appellants acknowledge that the prevailing statutory interpretation in most of the Circuits brings them and their association within the meaning of the RICO statute's requirement of an "enterprise," as defined in 18 U.S.C. § 1961(4):

"(Enterprise)" includes any individual, partnership, corporation, association, or other legal entity, and any union or group of individuals associated in fact although not a legal entity . . . .

Yet appellants argue that their association is not an "enterprise" because it had no legitimate purpose. They argue that the legislative history of RICO indicates a desire to prevent infiltration of legitimate business, and therefore all offenses like those alleged here not involving a legitimate business should be prosecuted under other pre-existing criminal laws. Otherwise, they argue, the complex RICO statute would have been unnecessary.

Five Circuits have rejected this argument and have concluded that even an association formed for the sole purpose of illegal racketeering can satisfy the "enterprise" requirement. E. g., United States v. Rone, 598 F.2d 564 (9th Cir. 1979); United States v. Swiderski, 193 U.S. App. D.C. 92, 593 F.2d 1246 (D.C.Cir.1978), cert. denied, 441 U.S. 933, 99 S. Ct. 2055, 60 L. Ed. 2d 662 (1979); United States v. Elliott, 571 F.2d 880 (5th Cir.), cert. denied, 439 U.S. 953, 99 S. Ct. 349, 58 L. Ed. 2d 344 (1978); United States v. Altese, 542 F.2d 104 (2d Cir. 1976), cert. denied, 429 U.S. 1039, 97 S. Ct. 736, 50 L. Ed. 2d 750 (1977); United States v. Cappetto, 502 F.2d 1351 (7th Cir. 1974), cert. denied, 420 U.S. 925, 95 S. Ct. 1121, 43 L. Ed. 2d 395 (1975). Only the Sixth Circuit, in a divided panel opinion later vacated for rehearing en banc, has suggested it would follow appellants' theory. United States v. Sutton, 605 F.2d 260 (6th Cir. 1979), vacated and rehearing en banc granted, Nos. 78-5134 to -5139, -5141, -5143 (6th Cir. Nov. 7, 1979) (rehearing held Apr. 2, 1980).

We have previously held that RICO is to be construed liberally. United States v. Forsythe, 560 F.2d 1127, 1135-36 (3d Cir. 1977). And in United States v. Frumento, 563 F.2d 1083, 1089-92 (3d Cir. 1977), cert. denied, 434 U.S. 1072, 98 S. Ct. 1256, 55 L. Ed. 2d 775 (1978), this court held that the word "enterprise" was broader than a private business or a union, and included a state agency. But we need not go so far as to adopt generally either the narrow or the broad definition of "enterprise" in this case. The purpose of RICO prevention of infiltration of legitimate business by racketeers would in any event be vindicated by the convictions here, since the wholly illegitimate Provenzano association subverted legitimate unions and businesses, although the Government did not allege that any union local was the "enterprise" (A3854 jury charge). We decline in this case to construe the RICO statute so as to allow the appellants a defense that they made sure not to engage in any legal activity.

3. Picardo's Testimony About Use of Fear and Intimidation

Appellants assert that their convictions must be reversed because the jury heard Picardo testify to other wrongs that the appellants committed, specifically loan-sharking and gambling (A958); to appellants' use of fear and intimidation (A1000); to their threatening Picardo should he fail to deliver on his obligations (A1090); to their fixing of horse races (A1114); and to their threatening to kill Picardo in jail (A1759). The district court admonished Picardo against testifying about appellants' other wrongs, and twice even the Government was surprised by Picardo's responses (A966 loan-sharking and gambling; A1115 fixing of horse races), and disclaimed any attempt to prove them.

Of course, evidence of such alleged criminal activity is not admissible to prove that the appellants were guilty of the crimes charged. Fed.R.Evid. 404(b). Nevertheless, evidence of other crimes is admissible for other purposes, such as to show "motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident," id. Although the Government never attempted to justify introduction of appellants' other wrongs on any of these grounds when appellants objected, and the district court did not explain its reasons for admitting the testimony, such a specification is not necessary, as long as the statements were in fact admissible. See United States v. Rosenstein, 474 F.2d 705, 711-13 (2d Cir. 1973) (appellate court may affirm admission of evidence on ground never urged or decided in trial court, as long as evidence is admissible under ground relied on by appellate court for same purpose for which it was admitted by trial court);*fn10 cf. PAAC v. Rizzo, 502 F.2d 306, 308 & n.1 (3d Cir. 1974) (appellate court may affirm correct decision on ground not relied upon by district court), cert. denied, 419 U.S. 1108, 95 S. Ct. 780, 42 L. Ed. 2d 804 (1975).

Evidence of the use or intended use of fear and intimidation to control the piers (A1000) was relevant to show both the opportunity to carry out the scheme and the plan of how to carry out the scheme. Picardo's testimony as to his fears of reprisals by the others should he fail to come up with the money (A1090) was relevant to show both knowledge of the others and how the others controlled Picardo's role (plan), as opposed to the defense theory that the entire operation was merely a larceny of Picardo's own doing. Evidence of the death threat Stephen Andretta made to Picardo while Picardo was incarcerated (A1758-59) was relevant to show how the others controlled Picardo's role (plan), to the extent that they forced him to sell Lift-Van when he, being incarcerated, could no longer operate it. Moreover, defense counsel had already elicited from Picardo on cross-examination that he was angry during his incarceration at Stephen Andretta (for reasons defense counsel would not let Picardo explain) (A1611-13), and that Picardo had already told an FBI agent that Stephen Andretta had made (unspecified) threats to him (A1669). Defense counsel had thus cast doubts on Picardo's credibility, and evidence of the reason for his anger at Stephen i. e., a one-time death threat should Picardo not follow orders was independently relevant to rebut or explain Picardo's motive to lie against his associates, as might be suggested by a general anger at their not helping him out of jail over a long period. Finally, defense counsel had already elicited the fact that Stephen Andretta had threatened Picardo in some way; so the elucidation of the precise nature of the threat was, on balance, not prejudicial.*fn11

Some of Picardo's answers, however, i. e., those relating first to loan-sharking and gambling, and second to the fixing of horse races, were clearly irrelevant for any purpose. When Picardo gave these answers, the court promptly told the jury to disregard the testimony (A958-59, A1119). Moreover, in the charge to the jury, the district court again stated that they must disregard questions and answers, objections to which were sustained (A3799-800), as well as remarks that the court had stricken (A3800). In each instance, the prosecutor claimed that he had not expected such answers, and that he had told Picardo to avoid inserting extraneous matters (A966, A1114-16). Both responses came after questions that were designed to elicit other information.

As to the first, the Assistant United States Attorney asked Picardo to identify the types of businesses in which the association, Picardo and the appellants, engaged, expecting Picardo to reply that only trucking was involved. Instead, Picardo answered, "Trucking, loan-sharking, gambling" (A958). As to the second, Picardo had previously testified that "North Jersey Feed Company was for the purpose of getting into the race track and to be able to tranquilize horses and fix races" (A1114). The Assistant United States Attorney then asked whether Picardo had involved his associates with that business, expecting Picardo to explain that his "associates" were not involved, and that, on the contrary, it was Picardo's way to siphon money secretly from them (A1114-15). Instead, Picardo answered that he had involved his associates with North Jersey Feed Company (A1114).

Under these circumstances, we cannot say that the unsolicited references to loan-sharking, gambling, and the fixing of horse races were so inflammatory or prejudicial that they could not be cured by jury instructions, which, as noted, were given. We therefore conclude that defendants were not prejudiced. Nor do we think that this case falls within the rule of Government of Virgin Islands v. Toto, 529 F.2d 278 (3d Cir. 1976), requiring reversal despite the district court's striking of the testimony. The testimony here was not of other convictions, but rather consisted of an offhand mention that the appellants were also involved peripherally in other common illegal activities. Given the long and complex descriptions of the RICO violations, we are satisfied that the casual mention of others did not constitute reversible error.

4. Picardo's Unsolicited Comments

Picardo defied the district court's warnings and conversed with marshals while sidebars were being held in another room. Although these conversations took place within sight of the jury, they did not take place within the jurors' hearing. The jurors all denied hearing anything, except for one alternate juror (who ended up being dismissed with the others at the end of the summations), who "heard him (Picardo) say something about somebody's wife" (A974). We cannot say that this conduct, albeit in disregard of the district court's ruling, requires reversal.

5. Pretrial Publicity

Appellants claim that certain jurors were impaneled when they should have been removed for cause for lack of impartiality. The crux of the problem was pretrial publicity about Provenzano. The appellants argue that either many veniremen should have been excused for cause, or jurors should have been chosen from a different vicinage, or Provenzano's trial should have been severed.*fn12 Appellants claim prejudice in two ways: first, that biased jurors decided the case, and, second, that appellants were prejudiced by the failure of the district court to excuse other veniremen for cause, forcing appellants to waste peremptory challenges to excuse them, see United States v. Nell, 526 F.2d 1223, 1229 (5th Cir. ...

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