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In Re: Dauphin County Fourth Investigating Grand Jury

April 11, 2011

IN RE: DAUPHIN COUNTY FOURTH INVESTIGATING GRAND JURY REPORT OF SPECIAL PROSECUTOR ALBERT G. BLAKEY


The opinion of the court was delivered by: Mr. Chief Justice Castille

CASTILLE, C.J., SAYLOR, EAKIN, BAER, TODD, McCAFFERY, ORIE MELVIN, JJ.

OPINION

This matter arises from proceedings that were undertaken during the course of an investigation into allegations of disclosures of protected information relating to the Dauphin County Fourth Investigating Grand Jury.

On May 4, 2006, the District Attorney of Dauphin County, Edward M. Marsico, Jr., filed an Application to impanel an Investigating Grand Jury. The application to investigate concerned certain matters relating to the licensing application filed on behalf of Louis A. DeNaples and Mount Airy #1, LLC (herein "Petitioners"*fn1 ) for a Category 2 slot machine license, pursuant to the Pennsylvania Race Horse Development and Gaming Act, 4 Pa.C.S. § 1101 et seq., and the Pennsylvania Gaming Control Board's decision to award a license to Petitioners.*fn2 On June 2, 2006, the Honorable Richard A. Lewis, then President Judge of the Dauphin County Court of Common Pleas, granted the District Attorney's application. President Judge Lewis appointed the Honorable Todd A. Hoover as the supervising judge of the grand jury.

On May 3, 2007, the grand jury issued three subpoenas duces tecum to the Gaming Control Board and its Executive Director, directing them to produce documents relating to Petitioners' gaming application and licenses. Petitioners filed a Petition to Intervene, to Stay Grand Jury Subpoenas, and for Access to Notice of Submission. On July 6, 2007, Supervising Judge Hoover ordered the District Attorney to provide Petitioners with a copy of the Notice of Submission, which had been amended. On that date, a subpoena duces tecum was served on Petitioner DeNaples, directing him to appear before the grand jury.

On July 18, 2007, Petitioners filed an Omnibus Motion to Quash Grand Jury Investigation and Omnibus Motion to Quash Grand Jury Subpoenas. A stay of enforcement was entered by Supervising Judge Hoover. On July 23, 2007, Supervising Judge Hoover heard argument on the Petitioners' Petition to Intervene, to Stay Grand Jury Subpoenas, and for Access to Notice of Submission. During the proceeding, Petitioners' counsel argued to Supervising Judge Hoover that protected information regarding the grand jury investigation had been improperly disclosed. Specifically, Petitioners' counsel related that the Gaming Control Board had been contacted and questioned whether it had received subpoenas from an investigating grand jury. First Assistant District Attorney Francis T. Chardo indicated that he had alerted SupervisingJudge Hoover that he had received calls from the Philadelphia Daily News and The Associate Press inquiring about grand jury subpoenas.

On July 26, 2007, Supervising Judge Hoover conducted an in camera conference to address newspaper articles that were published on that same date by the Philadelphia Inquirer, the Philadelphia Daily News, and the Associated Press. The news articles reported the existence of a grand jury investigation involving Petitioner DeNaples.

The articles claimed that "sources close to the investigation" had disclosed that the grand jury investigation involved whether Petitioner DeNaples had lied in connection with his application for a casino license, and reported that the Dauphin County District Attorney's Office had issued a subpoena to the Gaming Control Board. The articles indicated that the reporters had contacted the Gaming Control Board to inquire whether the Board had been subpoenaed for documents or the testimony of its staff, but that a Board spokesman had declined to comment. Furthermore, specific witnesses who had appeared to testify before the grand jury were identified in the articles.

Supervising Judge Hoover requested that a written motion be filed by Petitioners' counsel, after which a hearing would be scheduled. On July 31, 2007, Petitioners filed a Motion for an Evidentiary Hearing Regarding Violation of Grand Jury Secrecy, alleging that the many media reports of the grand jury proceedings demonstrated a breach of secrecy.

On September 20, 2007, Supervising Judge Hoover entered several orders pertaining to Petitioners' Omnibus Motion to Quash Grand Jury Investigation and Omnibus Motion to Quash Grand Jury Subpoenas. One of the orders denied Petitioners' Motion to Quash for Violations of the Grand Jury Act and their request for disqualification of the Dauphin County District Attorney's Office.

On October 1, 2007, Petitioners filed an Emergency Application for Review Pursuant to 42 Pa.C.S. § 722(5) and Pa.R.A.P. 3331(a) with this Court, challenging the District Attorney's authority to investigate alleged crimes arising out of the gaming licensing application process. Petitioners also raised claims that (1) the application for impanelment of the grand jury was invalid; (2) the grand jury investigation usurped the Gaming Board's investigatory authority and discretion; (3) the confidentiality provisions of the Gaming Act had been violated; (4) the notice of submission was invalid; and (5) subpoenas duces tecum issued to the Gaming Board and its executive director for documents relating to Petitioners' gaming applications and license were legally flawed. Petitioners' request for a stay was granted by this Court in order to maintain the status quo and to allow the District Attorney to respond to Petitioners' allegations.

On December 10, 2007, this Court issued an opinion in In Re Dauphin County Fourth Investigating Grand Jury, 943 A.2d 929 (Pa. 2007), summarily denying Petitioners' Application for Review with respect to most issues because the claims did not involve final orders or warrant immediate review pursuant to 42 Pa.C.S. § 726, except for Petitioners' challenge to the District Attorney's authority/jurisdiction to conduct the grand jury investigation into the licensing process. With respect to the violations of grand jury secrecy, we noted:

The Application does little more than reference alleged breaches of Grand Jury secrecy, citing newspaper articles that discuss information relating to the on-going investigation which is in the public realm (e.g. judicial orders, subpoenas, etc.). Petitioners identify nothing that threatens to expose the "sanctity" of the Grand Jury's inner-workings. Furthermore, with the exception of the prosecutorial authority claim discussed below, petitioners' claims do not implicate "an issue of immediate public importance" that would require this Court to take extraordinary steps to "enter a final order or otherwise cause right and justice to be done." See 42 Pa.C.S. § 726. This Court will not exercise extraordinary jurisdiction to consider any and every challenge to the Grand Jury process, challenges that are properly reviewable in the ordinary course, only once a final order issues.

943 A.2d at 935-936.*fn3

We exercised extraordinary jurisdiction, however, over the challenge pertaining to the authority of the District Attorney to convene a grand jury under the Gaming Act. The issue involved the interpretation of Section 1517(d) of the Gaming Act (relating to investigations and enforcement), which states in relevant part:

(d) Criminal action.-

(1) The district attorneys of the several counties shall have authority to investigate and to institute criminal proceedings for a violation of [the Gaming Act].

(2) In addition to the authority conferred upon the Attorney General under . . . the Commonwealth Attorneys Act, the Attorney General shall have the authority to investigate and, following consultation with the appropriate district attorney, to institute criminal proceedings for a violation of [the Gaming Act]..

4 Pa.C.S. § 1517(d).

Petitioners acknowledged that Section 1517(d) explicitly provides district

attorneys with the authority to investigate violations under the Gaming Act, but argued that the authority of a district attorney should be deemed to be subordinate to that of the Attorney General. The Dauphin County District Attorney contended that the Gaming Act did not place any limitation on the powers and duties of district attorneys, and did not purport to vest exclusive jurisdiction over criminal violations of the Act in the Attorney General. As amicus curiae, the Attorney General posited that nothing in the Act rendered the authority of district attorneys subordinate to that of the Attorney General, and that the prosecutorial authority of district attorneys was concurrent.

We found the Attorney General's position to be persuasive, stating:

Section 1517 of the Act plainly confers authority upon county district attorneys to prosecute violations of the Act and does not subordinate that authority to that of the Attorney General. Nor does Section 1517 purport to limit that authority to post-licensing crimes. Just as importantly, nothing in the Act purports to remove or limit the existing general authority of county district attorneys to investigate crimes occurring in their jurisdiction.

943 A.2d at 938.

We determined that "[t]he types of possible criminal violations being investigated by the District Attorney in this case - false statements/perjury relating to the licensing process, which occurred within his territorial jurisdiction - are clearly within the scope of veracity-based crimes recognized by the Gaming Act." 943 A.2d at 938, citing 4 Pa.C.S. § 1518(a)(1). Neither the Gaming Act nor the Investigating Grand Jury Act appeared to limit the District Attorney's use of the investigating grand jury under the circumstances of the case. On that basis, we rejected Petitioners' challenge to the Dauphin County District Attorney's authority, holding that "county district attorneys share concurrent jurisdiction with the Attorney General to investigate criminal violations of the Gaming Act, and that the Gaming Act does not limit the existing authority of local prosecutors." 943 A.2d at 938.

While this Court was considering Petitioners' challenge to the authority of the District Attorney, Supervising Judge Hoover deferred consideration of Petitioners' Motion for Evidentiary Hearing Regarding Violation of Grand Jury Secrecy, which had been filed on July 31, 2007. After this Court issued its opinion, the District Attorney requested that Supervising Judge Hoover deny the pending motion. Petitioners opposed the request and asked Supervising Judge Hoover to conduct a hearing.

On January 2, 2008, Petitioners provided Supervising Judge Hoover with copies of newspaper articles that had been published after the pending motion had been filed. The articles referred to specific matters that were purportedly under investigation by the grand jury, described information about those grand jury matters as having been provided by "sources familiar with the case," and identified witnesses who had appeared before the grand jury. The submitted articles included the following:

August 29, 2007 Philadelphia Daily News article, referring to witnesses before the grand jury, including that (1) "Philadelphia labor leader Sam Staten Sr. testified before the grand jury in Harrisburg probing whether the state's first slots licensee lied during the application process about ties to organized crime;" (2) "[p]rior to Staten's grand jury appearance, James Decker, a former Lackawanna County chief clerk, testified for about 30 minutes;" and (3) "[a]nother witness yesterday identified himself to an official in the hallway as Thomas Joseph, owner of a Mountain Top, Luzerne County, property that was searched during an investigation of [William] D'Elia and associates in 2001."

August 29, 2007 Allentown Morning Call article stating that "[t]he grand jury in part is investigating whether DeNaples has had ties to William D'Elia, a reputed Scranton mobster who is awaiting trial on federal charges of soliciting a murder and laundering drug money. State gaming law prohibits a casino licensee from having ties to organized crime."

August 30, 2007 Philadelphia Daily News article, stating "[y]esterday, the Rev. Joe Sica and former assistant U.S. attorney Sal Cognetti, Jr. turned up at the Dauphin County Courthouse, where a grand jury is investigating whether DeNaples has ties to organized crime or lied in the process of winning that casino license."

September 25, 2007 The [Scranton] Times-Tribune article stating that "[a] grand jury in Harrisburg is investigating whether DeNaples misled the gaming board about alleged mob ties according to sources familiar with the case who spoke on condition of anonymity because of the confidentiality of grand jury matters."

September 27, 2007 Philadelphia Inquirer article, stating that "[a] person familiar with the probe has told the Associated Press that the grand jury is looking into information on DeNaples that grew out of a long state and federal investigation into alleged Scranton-area mobster William D'Elia."

September 27, 2007 Philadelphia Daily News article, stating that (1) "Shawn Fordham, Mayor Street's one-time top aide and gaming advisor, testified yesterday before a grand jury in Harrisburg;" (2) "[a]nother Philadelphia-area grand jury witness, Barry Shapiro, president of BudTel Inc., a telecommunications company, said after his testimony that 'I installed a pay phone on [DeNaples] property. They wanted to know about that;'" and (3) "[t]hree other witnesses, a couple in their early 60s, and a white-haired, heavy-set man also testified before the grand jury yesterday."

October 5, 2007 Philadelphia Inquirer article stating that "[a] person familiar with the probe has told The Associated Press that the grand jury is looking into information on DeNaples that grew out of a long state and federal investigation into alleged Scranton-area mobster William D'Elia. The person spoke on condition of anonymity because of the sensitivity of the case. As part of that investigation, authorities are looking into the accuracy of DeNaples' application for a slot-machine license, in which he told state regulators he had no connections to organized crime, the person said."

October 18, 2007 Philadelphia Inquirer article stating that "[a] person familiar with the probe has told The Associated Press that the grand jury is looking into the accuracy of DeNaples' assurances that he has no connections to organized crime."

October 24, 2007 Philadelphia Inquirer article stating that "[a] person familiar with the probe has told The Associated Press that the grand jury is looking into the accuracy of DeNaples' assurances that he has no connections to organized crime. The person spoke on condition on anonymity because of the sensitivity of the grand jury investigation which is cloaked in secrecy."

The grand jury issued a presentment against Father Joseph F. Sica

recommending criminal charges, which was accepted by Supervising Judge Hoover on December 28, 2007. On January 22, 2008, Sica filed a Petition for Review Pursuant to Pa.R.A.P. 3331 with this Court, which was docketed at 13 MM 2008. On January 23, 2008, the grand jury issued a presentment against DeNaples and Mt. Airy, which was accepted by the Supervising Judge by a final order dated January 28, 2008. On February 11, 2008, DeNaples and Mount Airy filed a Renewed Application for Review Pursuant to 42 Pa.C.S. § 722(5) and Pa.R.A.P. 3331(a) and Application for a Stay of Proceedings Pending Review with this Court. These pleadings were docketed at 28 MM 2008. The Petition raised several claims and renewed their assertion that there had been violations of the secrecy of the grand jury investigation. The Petitioners requested the appointment of a master to investigate the alleged violations and sought a stay of the proceedings.

On May 2, 2008, this Court entered a Per Curiam Order at docket numbers 13 & 28 MM 2008, granting the request for the exercise of extraordinary jurisdiction pursuant to 42 Pa.C.S. § 726, but limited to the question of alleged violations of grand jury secrecy. The order further provided that:

The matter is remanded to Supervising Judge Todd A. Hoover for the purpose of conducting an expedited evidentiary hearing relating to the allegations of violations of the secrecy provisions of the Investigating Grand Jury Act, 42 Pa.C.S. ยง 4541 et seq. At the conclusion of the hearing, Supervising Judge Hoover is directed to consider whether a special prosecutor should be appointed to pursue the allegations and to forward an opinion setting forth his findings and recommendations to this Court within ninety days of the date of this ...


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