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United States v. Martino

argued: April 6, 1987.


On Appeal from the United States District Court for the Eastern District of Pennsylvania, D.C. Criminal No. 85-00150-02.

Sloviter and Becker, Circuit Judges, and Fisher, District Judge.*fn*

Author: Sloviter


SLOVITER, Circuit Judge.

The district court characterized a grand jury subpoena issued to an undercover agent in the pseudonym under which he was working as "a spurious order" of court which "obviously exceeds the bounds of propriety," and, exercising its supervisory power, dismissed two counts of an indictment returned by the grand jury and suppressed conversations with the agent. In what appears to be a case of first impression, we must decide whether the district court's order should be affirmed.



Leonard L. Martino, a former member of the Pennsylvania legislature, and Charles Caputo, the former Executive Director of the State Government Committee of the Pennsylvania House of Representatives (now deceased), were indicted by a federal grand jury in a sixteen-count indictment on charges of perjury, obstruction of justice and conspiracy in violation of 18 U.S.C. §§ 1621, 1503, and 371. The indictment arose out of a five-year multinational FBI undercover operation called "Operation Gallstone".

Beginning in 1982 and continuing until February 1985, Martino and Caputo met with FBI Special Agent Jim Vaules, who was using the pseudonym "Wayne Hess". Vaules pretended to be engaged in the insurance business. The government contends it has numerous recorded conversations during which Martino and Caputo requested payments from Vaules for members of the state legislature to procure issuance of a license to an undercover company to write insurance in Pennsylvania, discussed padding of the insurance company's books to inflate its balance sheet, and represented that they could procure a furlough for a federal prisoner in return for campaign contributions to members of the United States Congress.

In late January and early February 1985, the FBI interviewed Martino and Caputo about their conversations and activities with "Hess". The FBI and the prosecutor, who did not advise Martino and Caputo that their conversations with "Hess" had been recorded, concluded that Martino and Caputo lied in their interview about their relationship with "Hess" and their lack of knowledge of requests for money for bribes and political influence for public officials.

On January 25, 1985, three grand jury subpoenas were issued, for Martino, Caputo, and in the undercover agent's pseudonym of "Wayne Hess". On January 30, 1985, Vaules, acting as "Hess", informed Martino that he had received a grand jury subpoena, although Vaules did not actually pick up the "Hess" subpoena until sometime between February 4, 1985 and February 8, 1985. Caputo and Martino were served with their subpoenas on February 4 and 6 respectively. Martino's and Caputo's subpoenas were returnable on February 11, 1985. The "Hess" subpoena was returnable on February 25, 1985.

According to the government, Martino and Caputo contacted "Hess" to inform him of their interview with the FBI, and had several conversations with him in advance of their grand jury appearances in which they told "Hess" what to say before the grand jury and about the false testimony that they planned to give.

Martino, who is a lawyer, appeared before the grand jury on February 11, 1985. He was apprised of his right to remain silent, but he testified. Martino and Caputo met with "Hess" immediately following their grand jury appearances. According to the government, at that time "Hess" showed his subpoena to Martino and Caputo.*fn1 Martino and Caputo allegedly informed "Hess" of the testimony they gave and told him what he should say.

On April 22, 1985, the grand jury returned a sixteen count indictment against Martino and Caputo. Count one of the indictment charged the defendants with conspiracy to procure and commit perjury and to obstruct justice by testifying falsely to the grand jury and attempting to induce "Hess" to testify falsely. Count two of the indictment charged Martino and Caputo with the substantive act of obstructing justice based on the same facts alleged in count one of the indictment. The remaining fourteen counts charged the defendants with perjury before the grand jury.*fn2

On June 13, 1985, Caputo filed an omnibus pre-trial motion in which Martino joined. Caputo's motion alleged, inter alia, prosecutorial misconduct in issuing the "sham" subpoena to Vaules in the pseudonym of "Wayne Hess " and sought dismissal of the indictment. In the alternative, the defendants sought suppression of their February 11, 1985 grand jury testimony.

The district court filed a memorandum and an order of April 28, 1986, modified by an order of May 1, 1986, dismissing counts one and two of the indictment. The district court's memorandum stated that the court was exercising its supervisory power to dismiss the two counts of the indictment on the ground that issuance of the subpoena in the pseudonym "Wayne Hess" was prosecutorial misconduct which reflects upon the integrity of the judicial process. United States v. Caputo, 633 F. Supp. 1479, 1490-92 (E.D. Pa. 1986). The district court also suppressed all evidence of any conversations between the defendants and "Hess" which took place on or after January 25, 1985, the date of issuance of the subpoena to "Wayne Hess", on the ground that the subpoena was a significant factor in bringing about those conversations. Id. The district court denied the government's motion for reconsideration and consideration of new evidence on the issue of lack of prejudice. App. at 94-99.

The government appeals. This court has jurisdiction of the appeal under 18 U.S.C. § 3731.


Discussi ...

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