United States v. Salerno

974 F.2d 231
Court of Appeals for the Second Circuit·Decided June 28, 1991·No. Nos. 1586, 1601, Dockets 88-1464, 88-1470 to 88-1474, 88-1477, 88-1547, 90-1291, 90-1292, 90-1296, 90-1297, 90-1301, 90-1311, 90-1312 and 90-1351·Published·Cited by 9 cases

Opinion

GEORGE C. PRATT, Circuit Judge:

In United States v. Salerno, 937 F.2d 797 (2d Cir.1991), we reversed the RICO convictions of Anthony Salerno, Vincent and Louis DiNapoli, Nicholas Auletta, Edward J. Halloran, Alvin O. Chattin, Aniello Migliore, and Matthew Ianniello, based primarily on the district court’s refusal to admit, under Fed.R.Evid. 804(b)(1), the exculpatory grand jury testimony of two witnesses, Pasquale J. Bruno and Frederick DeMatteis. We reasoned there that in view of all of the incidents of grand jury testimony — the government’s unilateral ability to grant witness immunity before the grand jury and at trial, “the ex parte nature of the proceeding, the leading questions by the government, the absence of the defendant, the tendency of a witness to favor the government because of the grant of immunity, the absence of confrontation” — rule 804(b)(l)’s “similar motive” requirement need not be satisfied by defendants seeking to introduce exculpatory grand jury testimony. Id. at 807. We ruled that this error, which struck at the heart of the “Construction Case”, which in turn “formed the core of the RICO charges”, required us to “reverse the convictions of all eight appealing defendants in toto.” Id. at 808.

The Supreme Court, — U.S. -, 112 S.Ct. 2503, 120 L.Ed.2d 255 (1992), remanded. Concluding that it could find “no way to interpret the text of Rule 804(b)(1) to mean that defendants sometimes do not have to show ‘similar motive’ ”, id., — U.S. at -, 112 S.Ct. at 2507, and noting that we had “declined to consider fully the arguments now presented by the parties about whether the United States had such a [similar] motive”, the Court remanded to us “for further consideration.” Id., — U.S. at -, 112 S.Ct. at 2509. On remand, applying the evidentiary standards announced by the Supreme Court and contained in our precedents, we determine that in the grand jury, the government had a motive to examine Bruno and DeMatteis similar to what it would have had if they had testified at trial; therefore, we again conclude that the district court abused its discretion by refusing to admit the grand jury testimony of witnesses Bruno and De-Matteis; thus, the convictions of defendants Vincent DiNapoli, Louis DiNapoli, Nicholas Auletta, Edward J. Halloran, An-iello Migliore, and Alvin O. Chattin are reversed, and the case is remanded to the district court for further proceedings. Defendant Anthony Salerno’s appeals, Nos. 88-1477 and 90-1291, are dismissed as moot since he died during the pendency of this appeal. Defendant Matthew Ianniello was severed from the case after our original panel decision; he thereafter pled guilty to an extortion charge before Pierre N. Leval, Judge, to whom this case has been re-assigned in the district court; Ian-niello’s earlier appeals, Nos. 88-1464 and 90-1296, are dismissed as well.

[233]*233I.

A.

The “long and complex” history of this case is set forth in our original panel opinion, 937 F.2d at 799-803, and need not be repeated here. However, since the disposi-tive issue on remand revolves around the district court’s decision not to admit the grand jury testimony of Bruno and DeMat-teis, we will focus more intensely on the facts specific to that decision. We explained the factual background to that decision in our original panel opinion:

Pursuant to its obligation under Brady v. Maryland, 373 U.S. 83, 83 S.Ct. 1194, 10 L.Ed.2d 215 (1963), the government informed defendants Vincent and Louis DiNapoli that Pasquale J. Bruno and Frederick DeMatteis had testified under immunity before the grand jury, and that counsel for the defendants might wish to speak to those witnesses, as they were sources of potentially exculpatory evidence. Both Bruno and DeMatteis were principals in Cedar Park Concrete Construction Corporation (“Cedar Park”), one of the companies alleged to have been a member of the “Club” of concrete contractors.
At trial, counsel for the defendants called Bruno and DeMatteis to the stand, whereupon each asserted his fifth amendment privilege against self-incrimination. Although requested to do so by defense counsel, the government refused to immunize Bruno and DeMatteis. Defendants then moved the district court to direct the government to furnish copies of the grand jury minutes so that they could introduce the witnesses’ grand jury testimony under Fed.R.Evid. 804(b)(1), the “former testimony” exception to the hearsay rule for unavailable declarants.
After examining privately the grand jury minutes as well as other materials supplied by the government (all of which were transmitted to the district court under seal), and hearing in camera arguments from the government about the content and admissibility of the grand jury testimony, Judge Lowe denied the motion. She reasoned that the government’s motive to examine a grand jury witness is “far different from the motive of a prosecutor in conducting the trial”; thus, she held, the grand jury minutes were inadmissible under rule 804(b)(1).

United States v. Salerno, 937 F.2d at 804.

The “Club” referred to above formed the core of the government’s case at trial:

The government presented evidence that the Construction Case defendants [Salerno, both DiNapolis, Auletta, .Halloran, Chattin and Migliore] had participated in a scheme to rig the contracts for concrete superstructure work on high-rise buildings in Manhattan where the value of the concrete work was over $2 million. According to the government, Salerno, along with Vincent DiNapoli, orchestrated the scheme. By establishing control over two essential elements of Manhattan-area concrete contractors’ work — labor and ready-mix concrete — Salerno and Vincent DiNapoli were able to keep all of the work on these projects within a select group of contractors, called the “Club”. The Genovese family allegedly allocated the jobs among these companies by rigging the bids that they submitted. The Genovese family also allegedly controlled the labor market through corrupt union officials, and controlled the ready-mix market by entering into an alliance with defendant Halloran, to whom the Ge-novese family granted a monopoly for supplying concrete in Manhattan. The Genovese family profited from this scheme because, according to the government, the owner/developers and construction managers paid to it a two percent surcharge on all concrete jobs performed by club members.

Id. at 801-02.

At the time we filed our panel opinion, the grand jury minutes of the Bruno and DeMatteis testimony were under seal. Respecting this fact, we did not elaborate on the contents of the grand jury transcripts; we merely noted that “[v]ery generally stated, their grand jury testimony denied any awareness of, let alone participation in, such a ‘club’ ” of concrete contractors. Id. at 808. However, during the pendency of [234]*234the government’s petition for a writ of certiorari, we granted the defendants' motion to unseal the grand jury minutes so that they might respond to the petition.

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