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UNITED STATES v. JOSEPH

November 5, 1981

UNITED STATES of America
v.
Joseph A. JOSEPH



The opinion of the court was delivered by: TROUTMAN

MEMORANDUM AND ORDER

The jury, after four weeks of testimony, convicted defendant, Joseph A. Joseph, Clerk of Courts of Lehigh County, Pennsylvania, of violating the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. § 1961 et seq. Joseph now moves for judgment of acquittal, new trial and/or arrest of judgment. See Fed.R.Crim.P. 29, 33 and 35. The motions will be denied for the reasons set forth below.

 Whether defendant is entitled to a judgment of acquittal pursuant to Fed.R.Crim.P. 29(c) requires reference to the evidence adduced at trial and consideration of whether all the inferences drawn therefrom, when viewed in the light most favorable to the government, support the jury's finding of guilt beyond a reasonable doubt. Burks v. United States, 437 U.S. 1, 16, 98 S. Ct. 2141, 2149, 57 L. Ed. 2d 1 (1978); Glasser v. United States, 315 U.S. 60, 62 S. Ct. 457, 86 L. Ed. 680 (1942). Such a review reveals that Joseph, in his official capacity as Clerks of Courts, had the responsibility to insure that the requirements of the bailbonding system, with which he had contact, were properly met. Usually, before signing the authorization necessary to release an incarcerated defendant whose bail had been set or increased, Joseph had to attest that a properly executed and valid power of attorney was appended to the bail application. The power of attorney binds the insuring company to pay the bond in the event that a defendant fails to appear at a scheduled court hearing. When defendants on bail abscond, judges frequently revoke bail, issue a bench warrant and order the bail estreated. "Estreatment" refers to the manner by which a defendant's bail form, with the power of attorney attached thereto, is transmitted to the county solicitor's office for appropriate collection action. Joseph, in an effort to aid a bailbondsman, Speetles, accepted bailbonds and signed for the release of prisoners absent the proper collateral; i. e., the power of attorney. For these efforts Joseph received from Speetles a fee of 1% of the face value of the bond. The jury heard testimony that this bribe activity took place at least four times. Moreover, in an effort to protect Speetles' financial position from the loss incident to estreatments, Joseph violated court orders by failing to promptly forward the relevant documents to the county solicitor's office for collection action. In consideration for this activity, the defendant received cash payments on two occasions from Speetles. The government's case relied heavily upon direct evidence from Speetles which was substantially corroborated by documentary evidence and testimony from various county employees and officials. For his involvement in the scheme, Speetles had previously tendered a guilty plea to one count of mail fraud. Hence, construing all the evidence in the light most favorable to the government, we conclude that there was sufficient evidence from which the jury could find defendant guilty beyond a reasonable doubt.

 Rather than merely relying on alleged factual insufficiencies in support of his motion for judgment of acquittal, defendant relies heavily upon a legal interpretation of the RICO statute. We now turn to those contentions. Defendant argues that the reference to predicate state offenses contained in 18 U.S.C. § 1961(1) incorporates state substantive, procedural and evidentiary law as it applies to those delineated crimes and that the facts relied upon by the government prove nothing more than theft by extortion. Since that crime is not punishable by imprisonment for more than one year, defendant reasons, there is legally an insufficient basis for a RICO conviction.

 This argument fails since the federal prohibition goes to "racketeering" and not the predicate state offense of "bribery". In fact, the state offenses referred to are "definitional only; racketeering, the federal crime is defined as a matter of legislative draftsmanship by reference to state law crimes". United States v. Frumento, 563 F.2d 1083, 1087 (3d Cir. 1977), cert. denied, 434 U.S. 1072, 98 S. Ct. 1256, 55 L. Ed. 2d 775 (1978). The notion that state procedural defenses are available to RICO defendants was squarely rejected in United States v. Davis, 576 F.2d 1065, 1067 (3d Cir.), cert. denied, 439 U.S. 836, 99 S. Ct. 119, 58 L. Ed. 2d 132 (1978), where the court upheld a RICO conviction based upon predicate offenses which would have been barred by the state statute of limitations. Cf. United States v. Frumento, 563 F.2d at 1086 (a prior acquittal on a state predicate offense does not bar a subsequent RICO prosecution). See also United States v. Pantone, 634 F.2d 716, 718 (3d Cir. 1980). Other courts have reached the same conclusion. For example, in United States v. Brown, 555 F.2d 407, 418 n. 22 (5th Cir. 1977), cert. denied, 435 U.S. 904, 98 S. Ct. 1448, 55 L. Ed. 2d 494 (1978), the court observed that the "reference to state law in the federal statute is for the purpose of defining the conduct prohibited and is not to incorporate ... state ... rules". (quotations omitted). Accord, United States v. Malatesta, 583 F.2d 748, 758 (5th Cir. 1978), cert. denied, 440 U.S. 962, 99 S. Ct. 1508, 59 L. Ed. 2d 777 (1979); United States v. Salinas, 564 F.2d 688, 692-93 (5th Cir. 1977), cert. denied, 435 U.S. 951, 98 S. Ct. 1577, 55 L. Ed. 2d 800 (1978). We accordingly reject defendant's motion for judgment of acquittal which is based upon state rule of statutory interpretation.

 Noting that the indictment charges him with being associated with or employed by the "enterprise" of the Clerk of Courts, defendant argues that he is the Clerk of Courts and that it is "ridiculous" to charge him with being associated with, or employed by, himself. Defendant's argument here, too, misses the mark; the Clerk of Courts of Lehigh County is "an office", 16 Pa.P.S. § 4301 (Purdons), to which eligible candidates seek election pursuant to the relevant statute, 16 Pa.P.S. § 1301 (Purdons). Joseph, although holding that office is not the office, he is merely its manager and caretaker. Upon him falls the primary responsibility to oversee, manage and make certain that the responsibilities of the office are properly discharged. Moreover, United States v. Turkette, 452 U.S. 576, 101 S. Ct. 2524, 2528, 69 L. Ed. 2d 246 (1981) recently held that an "enterprise" is an "entity" and "associates" thereof, who commit the requisite number of racketeering acts, are properly charged in a RICO indictment. Additionally, an "enterprise" can consist of one person. United States v. Fineman, 434 F. Supp. 189 (E.D.Pa.1977).

 Defendant also argues that the failure to timely forward estreatments to the solicitor's office does not constitute a violation of a known legal duty and, therefore, that he should be acquitted. This argument is premised upon the contention that the laws which require estreatments to be forwarded are so confusing that defendant could not be expected to know and understand the duties which they impose. Even accepting this argument, testimony at trial revealed a number of breaches of known legal duties. For example, estreatments and bail conditions were established by court order. Failure to estreat in a timely manner was in violation of such an order. Likewise, accepting a bond without the court-ordered collateral constitutes a breach of a legal duty.

 Finally, in support of his Rule 29 motion, defendant argues that portions of Speetles' testimony were "simply incredible". Issues of credibility, however, are not properly raised at this stage. See United States v. Williams, No. 81-154 (E.D.Pa. September 28, 1981) (credibility is a matter for the fact-finder at trial). Accordingly, we will deny defendant's motion for judgment of acquittal.

 Fed.R.Crim.P. 34 provides in relevant part that motions in arrest of judgment shall be granted

 
if the indictment or information does not charge an offense or if the court was without jurisdiction of the offense charged.

 The government's proof included a series of "GI" exhibits, each of which showed that the enterprise affected interstate commerce. GI 1, 2, 3 and 4 are requisition slips prepared by defendant and sent to the county purchasing agent who then procured supplies in interstate commerce. Joseph argues that since he neither directly purchased nor requested that the goods be obtained in interstate commerce, that he did not have any effect thereon. This argument misconstrues the interstate aspect of the RICO statute which requires that the enterprise, rather than defendant's enterprise activities, affect interstate commerce. As we previously observed, a defendant's racketeering activity "need not affect interstate commerce; rather, the named enterprise, not the individual defendant, must be engaged in or affecting interstate commerce." United States v. Joseph, 510 F. Supp. 1001, 1003 (E.D.Pa.1981) (emphasis in original). Cf. United States v. Rone, 598 F.2d 564, 573 (9th Cir. 1979) (the government must show a "nexus of the enterprise to interstate or foreign commerce, albeit minimal", to satisfy the requirement). Requisitions by the Clerk's office for supplies subsequently purchased in interstate commerce suffices to meet the alleged jurisdictional defect. United States v. Altomare, 625 F.2d 5, 8 (4th Cir. 1980).

 Additionally, GI 5 is a qualified power of attorney from International Fidelity Company, an out-of-state insurance company, dated October 18, 1977, and filed six weeks thereafter in the Clerk's office. The document appoints Speetles as Lehigh County agent and evidences an interest on behalf of that company to be liable for bonds written by its agent.

 GI 6 is a revocation of Allied Fidelity Corporation's power of attorney previously executed on behalf of Speetles. Importantly, this document was ...


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