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UNITED STATES v. DI GILIO

September 9, 1987

United States of America, Plaintiff,
v.
John Di Gilio, John Barbato, Donald Carson, Anthony Gallagher, Anthony Sharkey, Milton Held, David Richman, Harold Friedman, Defendants



The opinion of the court was delivered by: DEBEVOISE

 Count 1 of this 14-count indictment charges that all eight of the defendants engaged in a RICO conspiracy in violation of 18 U.S.C. section 1962(d). Defendants moved to dismiss Count 1 on the grounds that (i) it fails to allege that the offense occurred within the statute of limitations period, (ii) it fails to allege a RICO enterprise and (iii) it fails to allege a pattern of racketeering activity. In addition, defendants contend that, except for the assets of defendants Di Gilio, Gallagher and Carson, Count 1 fails to allege facts which would permit forfeiture of the assets listed in the forfeiture demand. For the reasons set forth below, defendants' motion will be denied in its entirety.

 A. The indictment : Count 1 of the indictment charges that from June, 1981 to December, 1982 the defendants and "Benny Eggs" and "Mike Marine", being members of the John Di Gilio Group, an enterprise the activities of which affected interstate commerce, conspired among themselves and with others to conduct and participate in the conduct of the affairs of that enterprise through a pattern of racketeering activity in violation of 18 U.S.C. section 1962(d).

 Two kinds of racketeering activity are charged as the requisite pattern.

 Second, it is charged that between June, 1981 and September, 1982 Donald Carson received money from UTI, and John Di Gilio, John Barbato, Anthony Gallagher and Anthony Sharkey aided and abetted that offense in violation of 29 U.S.C. section 186(b)(1) and 18 U.S.C. section 2.

 Count 1 of the indictment also sets forth a description of various labor and business organizations affected by or used in the course of the conspiracy, the RICO enterprise, the purposes and means and methods of the RICO enterprise and the roles of the eight defendants.

 B. The statute : The substantive offenses prohibited by the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. sections 1961-1968, are set forth in subsections (a), (b) and (c) of section 1962. Subsection (a) prohibits the use of income derived from a "pattern of racketeering activity" to acquire a financial interest in an enterprise. Subsection (b) prohibits the acquisition or maintenance of an interest in an enterprise through a "pattern of racketeering activity". Subsection (c) prohibits conducting the affairs of an enterprise through a "pattern of racketeering activity."

 Subsection (d), which defines the offense charged in count 1 of the instant indictment, provides that "it shall be unlawful for any person to conspire to violate any of the provisions of subsections (a), (b) or (c) of this section." Although the indictment does not specify which subsection defendants are charged with conspiring to violate, the language of the indictment makes it clear it charges a conspiracy to violate subsection (c). That subsection provides in full that "it shall be unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity . . ."

 The various RICO substantive offenses are delineated by the definitions contained in section 1961.

 A "person" is "any individual or entity capable of holding a legal or beneficial interest in property." 18 U.S.C. section 1961(3). Defendants do not challenge the allegations that they are "persons" and thus within the statutory class capable of committing a RICO offense.

 An "enterprise" includes "any individual, partnership, corporation, or other legal entity, and any union or group of individuals associated in fact although not a legal entity." 18 U.S.C. section 1961(4). Count 1 of the indictment charges that defendant John Di Gilio was the head of an association referred to in the indictment and in this opinion as the "John Di Gilio Group." Count 1 further charges that the eight defendants and others were members of, employed by and associated with the John Di Gilio Group, and as such were a group of individuals associated in fact and constituting an enterprise within the meaning of section 1961(4). Defendants challenge the sufficiency of the indictment's enterprise allegations.

 "Racketeering activity" means any act or offense constituting a crime under various specified state or federal laws. Among those are "any act which is indictable under title 29, United States Code, section 186 (dealing with restrictions on payments and loans to labor organizations)". Defendants do not dispute that the count 1 allegations of payments to and receipt of payments by Donald Carson state violations of section 186 and thus effectively charge racketeering activity.

 This, then, is the statutory framework within which a determination of defendants' motions must be made.

 C. RICO Conspiracy : Although most of this opinion deals with the elements of a section 1962(c) offense, Count 1 charges a section 1962(d) offense, a conspiracy to violate any of the provisions of subsections (a), (b) or (c) of section 1962. It is to be inferred from the ...


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