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State v. Musto

Decided: June 16, 1982.

STATE OF NEW JERSEY, PLAINTIFF,
v.
WILLIAM V. MUSTO, NEW JERSEY STATE SENATE, CITY OF UNION CITY, BOARD OF COMMISSIONERS OF THE CITY OF UNION CITY, DEFENDANTS. WILLIAM V. MUSTO, SENATOR FROM THE 33RD DISTRICT, STATE OF NEW JERSEY, PLAINTIFF, V. CARMEN A. ORECHIO, PRESIDENT OF THE NEW JERSEY SENATE, AND THE NEW JERSEY STATE SENATE, DEFENDANTS



O'Brien, A.j.s.c.

O'brien

William V. Musto is a member of the New Jersey State Senate, having been re-elected to that office on November 3, 1981. On January 10, 1982 he was sworn in for his present term, which will expire on January 12, 1984. He is also a member of the Board of Commissioners of Union City and its mayor. His present term as commissioner and mayor expires on June 30, 1982. He was re-elected to the Board of Commissioners on May 11, 1982 to a term which commences on July 1, 1982.

On April 27, 1981 an indictment returned by the United States grand jury was filed in the United States District Court for the District of New Jersey containing 46 counts charging defendant with various federal offenses in 34 counts thereof. On March 26, 1982, following a lengthy trial on the indictment, Musto was found guilty on 28 counts and not guilty on six.

On May 10, 1982 a judge of the United States District Court imposed sentence upon Musto on those charges in the indictment for which he had been found guilty. That sentence has been stayed pending appeal. This court expresses no view concerning the merits of that appeal. For purposes of this case he stands convicted regardless of the outlook for his appeal.

On May 11, 1982 the Attorney General of the State of New Jersey, pursuant to N.J.S.A. 2C:51-2(a), instituted suit on behalf of the State seeking a judgment declaring that Musto had forfeited his public offices as senator and as member of the Board of Commissioners of the City of Union City and mayor, by reason of his convictions in the United States District Court.

On May 13, 1982 Musto filed suit as senator from the 33rd District against the New Jersey State Senate and Carmen A. Orechio, president thereof, seeking to restrain the operation of N.J.S.A. 2C:51-2(a) and (b) and to stay the New Jersey Senate from issuing a writ of election pursuant to N.J.Const. (1947), Art. IV, § IV, par. 1 and N.J.S.A. 19:3-28, as amended by L. 1981, c. 429. This court denied the application for preliminary relief. That denial was affirmed by the Appellate Division on May 14, 1982 and by the Supreme Court on May 17, 1982.

By resolution of the New Jersey Senate duly adopted on May 17, 1982, the president of the Senate was authorized and directed to issue a writ of election. On that date defendant Carmen A. Orechio, as president of the Senate, issued such writ of election and proclamation

The declaratory judgment suit of the Attorney General has been dismissed as to the State Senate. The Attorney General has intervened in the suit by Musto against the Senate and its president. On May 28, 1982 the Attorney General amended the original complaint seeking, pursuant to N.J.S.A. 2C:51-2(c), to preclude Musto from assuming the office of Commissioner of Union City to which he was elected on May 11, 1982. The court has consolidated the two actions on its own motion.

The relief sought by William V. Musto as plaintiff, as well as his defense to the declaratory judgment sought by the Attorney General, is twofold: (1) the statute is not applicable to him and (2) if applicable, it is unconstitutional. Since he is both a plaintiff and a defendant, he will be referred to hereinafter as "Musto." If he is incorrect, then the statute in question is self-executing. The forfeitures would result as a matter of law so that it would appear that there would be no need for a declaratory judgment from the court on that issue, as sought by

the Attorney General. However, the suit by Musto only deals with the office of senator, and the court will take judicial notice that Musto has continued to physically occupy and proclaim his role as commissioner and mayor of the City of Union City. Therefore, it appears necessary for the court to address the issue as articulated by the Attorney General in his complaint for declaratory judgment.

I. Applicability of the Statute

N.J.S.A. 2C:51-2, "Forfeiture of Public Office," provides in part as follows:

a. A person holding any public office, position, or employment, elective or appointive, under the government of this State or any agency or political subdivision thereof, who is convicted of an offense shall forfeit such office or position if:

(1) He is convicted under the laws of this State of an offense involving dishonesty or of a crime of the third degree or above or under the laws of another state or of the United States of an offense or a crime which, if committed in this State, would be such an offense or crime;

(2) He is convicted of an offense involving or touching such office, position or employment; or

(3) The Constitution or a statute other than the code so provides.

b. The forfeiture set forth in subsection a. shall take effect:

(1) Upon finding of guilt by the trier of fact or a plea of guilty, if the court so orders; or

(2) Upon sentencing unless the court for good cause shown, orders a stay of such forfeiture. If the conviction be reversed, he shall be restored, if feasible, to his office, position or employment with all the rights, emoluments and salary thereof from the date of forfeiture.

c. In addition to the punishment prescribed for the offense, and the forfeiture set forth in 2C:51-2a., any person convicted of an offense involving or touching on his public office, position or employment shall be forever disqualified from holding any office or position of honor, trust or profit under this State or any of its administrative or political subdivisions.

The first issue presented is whether the offenses of which Musto was convicted in the United States District Court are "an offense or crime which, if committed in this State, would be such an offense or crime," i.e., an offense involving dishonesty or a crime of the third degree or above, or "an offense involving or touching such office, position or employment."

The following is a list of the crimes of which Musto was convicted:

1. Conspiracy (to participate in the affairs of an enterprise through a pattern of racketeering, which included bribery, mail and wire fraud, and extortion under color of official right) in violation of 18 U.S.C.A. § 1962(d).

2. A violation of the Racketeer Influenced and Corrupt Organizations Statute, 18 U.S.C.A. § 1962(c), the so-called RICO statute. This is the substantive offense that was the object of the conspiracy.

3. Fifteen counts of mail fraud, in violation of 18 U.S.C.A. § 1341.

4. Five counts of wire fraud, in violation of 18 U.S.C.A. § 1343.

5. Three counts of extortion and attempted extortion under color of official office, in violation of 18 U.S.C.A. § 1951.

6. One count of a violation of the Travel Act, 18 U.S.C.A. § 1952 (travel in interstate commerce to promote and further a bribery scheme), and

7. Two counts of falsely subscribing to the content of federal income tax returns, in violation of 26 U.S.C.A. § 7206(1).

At issue in this litigation is the effect of a federal conviction on the applicability of the forfeiture statute of New Jersey. This issue has been considered by courts of various jurisdictions throughout the United States on a number of occasions. Mysteriously, Musto contends that the forfeiture provision has no application to him, without preenting any law in support of that position. Despite his unsupported contentions, the available case law indicates that

The case quoted, State ex inf. Peach v. Goins, 575 S.W.2d 175, 180 (Mo.Sup.Ct.1978), was an action seeking a declaration that the city sheriff had forfeited his office because he had been found guilty of felony offenses against the United States, although he had not been convicted under the state law. Similarly, in People ex rel. Ryan v. Coles, 64 Ill.App.3d 807, 21 Ill.Dec. 543, 381 N.E.2d 990 (1978), the question presented to the court was whether a public official who had been convicted of extortion, in violation of 18 U.S.C.A. § 1951, was eligible to hold the office of township supervisor.

In both of these cases the courts decided that a federal conviction triggered the operation of their state forfeiture statutes. Both courts chose to look beyond a cursory analysis of the elements of the federal crimes as compared with the state counterpart. For example, the court in Coles looked to the "essence" or "gist" of the federal crimes in determining whether they would have also been crimes under the state system. The court held:

In Goins, supra, the court stated:

The Oklahoma Supreme Court, in Hughes v. Oklahoma State Election Board, 413 P.2d 543 (Okl.Sup.Ct.1966), searched for the "gravamen" of the federal charge in its determination of whether a federal conviction of embezzlement of postal funds constituted a felony under the state statutes. The court found that:

In light of these decisions, it is apparent that a comparison of federal offenses with state statutory offenses muist proceed beyond an element-by-element breakdown. Paramount importance must be placed upon a determination of the "essence" or "gist" of the federal conviction. This court would be remiss in concluding that the forfeiture statute was inapplicable merely because the elements of the federal crime did not exactly correspond to the elements of the state crime. Therefore, it will adhere to the theory expounded by the Coles and Goins decisions, which apply the forfeiture provision if the "gist" or "essence" of the federal crime is an offense under state law. Of course, the additional requirements of dishonesty and an offense which involves or touches public office, which are peculiar to this State, will also be considered.

Discrepancies between federal crimes and state crimes are often due to the language in the federal law involving interstate commerce. All references to the elements of obstruction of interstate commerce and the like should be separated from the other elements of the crime for purposes of comparison. The decisions previously mentioned imply that this type of jurisdictional element does not affect the determination that a federal crime can also be considered criminal under state law. A convicted felon is not being punished for the underlying fraudulent act. Therefore, the underlying element of a federal crime overrides the jurisdictional element in importance in a determination of the applicability of the State forfeiture statute. The absence of a jurisdictional element in a state statute does not mean that the federal offense is not also a state crime.

In summary, the courts in other jurisdictions have provided support for the position that the forfeiture statute will be applicable to this litigation if it can be shown that (1) the "gist" or "essence" of the federal crime would constitute a crime or offense under state statutes, (2) the crime is an offense involving dishonesty or is a crime of the third degree or better, or (3) is an offense which involves or touches the public office. Based upon this format, it is clear that the crimes for which Musto was convicted would also be considered as criminal in New Jersey.

Counts one and two of the indictment upon which Musto was convicted involve a violation of the RICO statute (18 U.S.C.A § 1962(c)) as the substantive offense and conspiracy to violate that statute.

A review of the New Jersey Code of Criminal Justice, N.J.S.A. 2C:1-1 et seq., reveals that no comparable RICO statute exists in New Jersey. However, the violation of the RICO statute consists of an involvement "in the conduct of an enterprise's affairs through a pattern of racketeering activity . . . ." Therefore, it appears that the "gist" or underlying element in a violation of this statute is the involvement with racketeering activity. The indictment defines acts of racketeering here to include mail fraud (18 U.S.C.A. § 1341), wire fraud (18 U.S.C.A. § 1343), extortion (18 U.S.C.A. § 1951), interstate travel to promote bribery (18 U.S.C.A. § 1952), and bribery (under New Jersey statutes 2A:93-6 and 2C:27-2). Although there is no New Jersey RICO statute, the underlying elements of this statute, i.e., bribery and extortion, are crimes in New Jersey.

Bribery and extortion under the New Jersey statutes are the nexus between Musto and the enterprise and formed a part of the pattern of racketeering. Clearly the gist, or underlying elements, of the federal crime of which Musto was convicted under count two of the indictment were bribery and extortion, specifically under New Jersey law, which are third degree crimes as discussed infra.

It is well settled that where the intent to defraud is an essential element of a crime, that crime is one of moral turpitude. Jordan v. DeGeorge, 341 U.S. 223, 227, 71 S. Ct. 703, 705, 95 L. Ed. 886 (1950); O'Halloran v. DeCarlo, 156 N.J. Super. 249 (Law Div.1978), aff'd 162 N.J. Super. 174 (App.Div.1978). Prior to the current language of the forfeiture statute, which states that the offense or crime must be an offense "involving dishonesty," its predecessorm N.J.S.A. 2A:135-9, provided that the crime must involve "moral turpitude." The change from "moral turpitude" to "dishonesty" appears to be a broadening of the language of the statute. Therefore, crimes involving the intent to defraud would be considered as offenses involving dishonesty.

The crimes of extortion and bribery are clearly crimes which involve dishonesty. Inasmuch as dishonesty is a distinct feature of bribery and extortion, the statutory language provides that it is unnecessary to prove that these offenses are graded as crimes of the third degree or above and involve or touch defendant's public office. Despite the fact that these elements which trigger the forfeiture statute are in the alternative, this court is satisfied by a review of the facts and the applicable statutes that each of the elements outlined in N.J.S.A. 2C:51-2(a) have been met with respect to the crimes of bribery and extortion, as they form the basis for the RICO conviction.

The conspiracy for which Musto was convicted was a conspiracy in furtherance of a violation of the RICO statute. Since a violation of the RICO statute is considered a crime under the New Jersey statutes defining bribery and extortion, a conspiracy in furtherance of that illegal act would also be considered criminal under the state conspiracy statutes, N.J.S.A. 2A:98-1 and 2C:5-2. This is especially true when one considers the similarity between the federal conspiracy statute and the state conspiracy statutes.

The acts of conspiracy of which Musto was convicted occurred from about July 9, 1974 to September 15, 1980. Due to the length of time during which these acts transpired, both N.J.S.A. 2A:98-1 and 2C:5-2 are applicable. Each of these statutes bears a close relationship to the federal conspiracy statute in language and essence. The federal statute states:

Similarly, N.J.S.A. 2C:5-2 provides:

A person is guilty of conspiracy * * * to commit a crime if with the purpose of promoting or facilitating its commission he: (1) Agrees with such person * * * that they will engage in conduct which constitutes such crime * * *

Preceding N.J.S.A. 2C:5-2 was the language of N.J.S.A. 2A:98-1, which defined the crime of conspiracy as any 2 or more persons who conspire (a) to commit a crime * * * .

A comparison of the elements of conspiracy on both the state and federal level show that the "essence of the crime of conspiracy is the unlawful agreement between the parties to commit an offense * * * ." (jury charges of Judge Sarokin, U.S.D.C.) In State v. LaFera, 35 N.J. 75, 86 (1961), rev'd on other grounds, 42 N.J. 97 (1964), the court held that "The gist of the offense is the criminal agreement." As a result, it appears that the underlying element of this crime is the same in both forums, and a federal conspiracy to violate the RICO statute would also be a crime of conspiracy under New Jersey law.

Musto was also convicted of the crimes of mail fraud (18 U.S.C.A. § 1341) and wire fraud (18 U.S.C.A. § 1343). A discussion of the elements of these crimes demonstrates that it is the underlying elements of a crime, and not the specific elements thereof, which are important to a determination of whether a federal crime would also be a crime or offense under New Jersey law.

The mail fraud statute, 18 U.S.C.A. § 1341, states:

Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses * * * for the purpose of executing such scheme or artifice or attempting so to do, places in any post office * * * or knowingly causes to be delivered by mail * * * shall be guilty * * * .

The wire fraud statute, 18 U.S.C.A. § 1343, reads in a similar manner with the exception that reference is made to a different medium of communication.

Of course, there exists no comparable mail or wire fraud statutes in New Jersey -- the elements of the use of United States mail or wire are of purely federal design. However, an analysis of both statutes reveals that the felon is not being punished for using the mails or the wires as much as he is being punished for his attempt to deceive or obtain money or property by false pretenses. The element of the use of mails and wires is purely jurisdictional. The underlying offense is the attempt to scheme or defraud or take money or property under false pretenses. The New Jersey Code of Criminal Justice provides for theft crimes of this nature under N.J.S.A. 2A:111-1 and N.J.S.A. 2C:20-4. The latter statute, which is the current law in this State, provides:

A person is guilty of theft if he purposely obtains property of another by deception * * * .

The former statute, N.J.S.A. 2A:111-1, specifically mentions obtaining money or property by false pretenses in the following manner:

Any person who, knowingly or designedly, with intent to cheat or defraud any other person, obtains any money, property, security, gain, benefit, advantage, or any other thing of value by means of false promises, statements * * * is guilty of a misdemeanor.

While only one of these statutes addresses obtaining money, etc., by false pretenses specifically, both reveal an overriding element of dishonesty through fraudulent conduct. In addition, it is obvious that one who uses public office to obtain money under false pretenses or otherwise defraud another person or entity has committed a crime which affects the public office. Finally, under N.J.S.A. 2C:20-2(b), the crime of theft is a crime of the third degree since the amounts involved in the mail and wire fraud exceeded the sum of $500. Therefore, all the elements are present to make the federal crimes of mail and wire fraud constitute offenses involving dishonesty, and crimes of the third degree or better (apparently they also touched upon Musto's public office). Of course, it is not necessary that the latter two elements be present in order to trigger the application of N.J.S.A. 2C:51-2(a).

Counts 29 and 30 charge Musto with obstructing interstate commerce by extortion; by obtaining sums of money with the consent of the giver, the consent having been induced under color of official right. Count 31 involves an allegation that he and others used the color of their official positions to obtain an agreement to obtain a bribe in the amount of $125,000 in connection with a sale of the Vista View building in Union City. 18 U.S.C. § 1951 provides in pertinent part as follows:

(a) Whoever in any way or degree obstructs, delays or affects commerce or the movement of any article or commodity in commerce, by * * * extortion or attempts or conspires so to do, or commits or threatens physical violence to any person or property in furtherance of a plan or purpose to do anything in violation of this section shall be guilty of an offense.

The pertinent term in that statute applied to the indictment of Musto is "extortion." During the period covered by counts 29 and 30 extortion was both a common law and statutory crime. N.J.S.A. 2A:105-1. There is a distinction between the crime of extortion and that of bribery. Bribery consists in offering a present or receiving one, while extortion consists in demanding an illegal fee or present by color of office. 31 Am.Jur.2d § 2 at 902, State v. Begyn, 34 N.J. 35, pp. 45-48 (1980). The purpose of our extortion statute was simply to punish the officer who illegally took the fee. In bribery both the officer and the recipient are guilty of the offense. State v. Seaman, 114 N.J. Super. 19 (App.Div.1971). The essence of the offense of extortion is the receiving or taking by any public officer by color of his office of any fee or reward not allowed by law for performing his duties. State v. Begyn, supra, 34 N.J. at 46. The three essential elements which must be proved to establish extortion under the federal offense are that (1) defendant induced the victim to part with his property; (2) defendant did so knowingly and willfully by means of extortion, that is, with the person's or business' consent having been induced under color of official right, and (3) the extortionate transaction delayed, interrupted or adversely affected interstate commerce.

Naturally, the third element is purely jurisdictional and there is no comparable requirement in the State of New Jersey. However, it would not be necessary to prove that element in order to convict a defendant of extortion in the State of New Jersey, either at common law or under the statute, which appears on its face to have been originally intended to be iterative of the common law. State v. Goodman, 9 N.J. 569, 584; State v. Begyn, supra. Therefore, with regard to counts 29 and 30, there can be no doubt that these crimes are offenses which if committed in the State of New Jersey would involve dishonesty or be a crime of the third degree.

Extortion has been carried over into our Code of Criminal Justice, which was effective September 1979, in N.J.S.A. 2C:20-5 and in the Table it is also keyed to N.J.S.A. 2C:27-2 and 6, involving bribery and gifts to public servants.

Count 31 is an attempt to commit extortion, which appears to be as well a crime under the Code as it was at common law and statutorily prior to the adoption of the Code. The degree of the crime may vary under the Code, dependent upon the amount of money involved. However, the sums involved in the Musto case appear to be more than adequate to reach a third degree crime and, in any event, the offenses would involve dishonesty.

The crime of extortion committed by Musto would constitute a crime of the third degree or above, according to N.J.S.A. 2C:20-2b(1), which states that "theft constitutes a crime of the second degree if the property is taken by extortion." In any event, the offense involved dishonesty.

Count 32 alleges a violation of the Travel Act, 18 U.S.C.A. § 1952, which prohibits interstate travel to promote and facilitate a bribery scheme. The statute reads, in pertinent part, as follows:

Whoever travels in interstate or foreign commerce . . . with the intent to promote . . . any unlawful activity . . . shall be guilty of an offense against the United States. (b) As used in this section, "unlawful activity" means . . . bribery in violation of the law of the State in which committed.

Again, we have a federal offense which may be broken down into a jurisdictional element and an underlying element. The travel in interstate commerce is merely jurisdictional and is of no significance for the purpose of locating a comparable state statute. However, the underlying offense is described as "unlawful activity" and is defined as "bribery in violation of the laws of the State in which committed." Of course, bribery is a crime in New Jersey under a variety of statutes, N.J.S.A. 2A:93-4 and 6, and N.J.S.A. 2C:27-2 and 3. Since bribery is clearly an offense which involves dishonesty, the additional elements of the forfeiture statute, although present in this case, need not be shown to prompt application of the forfeiture statute.

Counts 37 and 38 charge Musto with a violation of 26 U.S.C.A. 2706(1), which reads as follows:

Any person who --

(1) -- Willfully makes and subscribes any return, statement, or other document, which contains or is verified by a written declaration that it is made under the penalties of perjury, and which he does not believe to be true and correct as to every material matter; . . . shall be guilty . . . .

Musto was charged with having knowingly and willfully made and subscribed, or caused to be made and subscribed, under penalties of perjury, income tax returns for himself and his wife for the two calendar years 1978 and 1979 which they did not believe to be true and correct as to the total amount of income they reported for those years.

The subject matter of these violations was federal income tax returns. Of course, there is no state statute which forbids the false subscription to federal income tax returns. However, there are, of course, penalties concerning New Jersey income tax returns. See N.J.S.A. 54A:9-15.

Despite the federal nature of the tax return, the underlying element in the crime is the perjury or false swearing to which the defendant was a willing party. Defendant is charged with placing his signature on a document which he did not believe to be true, in violation of the federal statute. The perjury statute in effect in 1977 and 1978, and apparently undisturbed by the adoption of the Code of Criminal Justice, is N.J.S.A. 41:3-1, which provides:

If any person shall willfully and corruptly swear, affirm or declare falsely, in or by any oath, affirmation, declaration or affidavit, required to be made or taken by any statute of this state, or necessary or proper to be made, taken or used in any court of this state, or for any lawful purpose whatever, such person shall be deemed guilty of perjury . . . . (Emphasis supplied)

Since a violation of 26 U.S.C.A. 7206(1) encompasses an act of perjury or false swearing, that federal offense would be a violation of the New Jersey perjury statute. Perjury and false swearing are offenses under the Code, N.J.S.A. 2C:28-1 et seq., although false swearing is an offense of the fourth degree, N.J.S.A. 2C:28-2(a). However, these clearly involve dishonesty since the offense reveals an attempt to defraud the Federal Government. In similar fashion, the state offenses of perjury and false swearing are offenses involving dishonesty.

As revealed by this crime-to-crime analysis and comparison, there is no basis for Musto's contention that the forfeiture statute (N.J.S.A. 2C:51-2) is inapplicable to him. The underlying

elements of the federal crimes for which he was convicted are all offenses under New Jersey law. The comparable state offenses of bribery, extortion, conspiracy, perjury and false swearing all constitute offenses involving dishonesty since they reveal an intent to defraud or deceive. Therefore, it appears that the requirements of N.J.S.A. 2C:51-2 have been fulfilled. Thus the forfeiture statute applies to Musto, if it is constitutional.

II. Constitutionality of the Statute

A legislative enactment is presumptively constitutional. Every intendment is to be made in favor of the validity of the statute. Stothers v. Martini, 6 N.J. 560, 567 (1951); State v. Thermoid Co., 16 N.J. 274, 279 (1954). The legislature is presumed to have intended its enactments to meet constitutional requirements. State v. Profaci, 56 N.J. 346 (1970). The cardinal principle of statutory construction must be to save and not to destroy.

The duty of the court is to strain, if necessary, to save the act, not to nullify it. New Jersey Sports & Expo. Auth. v. McCrane, 119 N.J. Super. 457, 476 (Law Div.1971), mod. on other grounds, 61 N.J. 1 (1972), app. dism. 409 U.S. 943, 93 S. Ct. 270, 34 L. Ed. 2d 215 (1973), appeal after remand In re Sports Complex Hackensack Meadowlands, 62 N.J. 248 (1973), cert. den. 414 U.S. 989, 94 S. Ct. 291, 38 L. Ed. 2d 228 (1974). This comment by Judge (now Justice) Pashman was cited with approval in Vreeland v. Byrne, 72 N.J. 292, 325 (1977).

When a state statute is challenged on state constitutional grounds, the nature of state government and the distribution of sovereign power within it make a plaintiff's burden a heavy one. Smith v. Penta, 81 N.J. 65, 74 (1979).

The right to hold public office is a valuable one and its exercise should not be declared prohibited or curtailed except by plain provisions of law. In re Ray, 26 N.J.Misc. 56, 59 (Circ.Ct. 1947), cited in Stothers v. Martini, supra 6 N.J. at 565. At the

time of his conviction and sentencing Musto held two public offices ---- that of state senator and municipal commissioner and mayor. The office of senator is a constitutional office, whereas that of commissioner is a statutory office. N.J.S.A. 2C:51-2(a) applies to persons "holding any public office, position or employment, elective or appointive, under the government of this State or any agency or political sub-division thereof . . . ." Thus, the statute applies to both offices. Since the effect of this statute on persons holding ...


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