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State v. Passante

November 12, 1987

STATE OF NEW JERSEY
v.
THOMAS PASSANTE, ROBERT TURCO, FELIX GENTILE, LAWRENCE MATURO, HERBERT WENSTRUM, KENNETH ZIEGLER, STANLEY SCHOFLER, LORI REGENSBURG, MICHAEL PANELLA, JOHN MORRA III, VINCENT PORZIO



Moses, J.s.c.

Moses

DECISION ON MOTION TO DISMISS INDICTMENT

Defendants Turco, Gentile, Ziegler, Panella, Wenstrum and Schofler move to dismiss their respective Counts of a 23 Count indictment charging them with racketeering, conspiracy, bookmaking, criminal usury, promoting gambling, and drug related offenses, all in violation of New Jersey's Racketeering statute, N.J.S.A. 2C:41-1 et. seq., (2C RICO). This portion of the Court's decision deals specifically with defendants' allegations that 2C RICO is unconstitutional.

POINT I. THE RACKETEERING STATUTE.

2C RICO is patterned after the Racketeer Influenced and Corrupt Organizations (RICO) provisions of Title IX of the federal Organized Crime Control Act of 1970. 18 U.S.C.A. § 1961 et. seq. Careful scrutiny reveals, however, that it is broader than federal RICO as it is intended to cure some of the problems currently facing federal RICO.

New Jersey RICO incorporates by reference 23 types of state crimes and federal crimes under 18 U.S.C.A. § 1961 (1)(A), (B) and (D) under the umbrella concept of "racketeering activity". The statute provides that anyone found to have committed any two (2) of these incorporated offenses within a ten-year period

has undertaken a pattern of racketeering if the two "predicate offenses" are interrelated by "distinguishing characteristics".

2C RICO specifically prohibits (1) using income derived from a pattern of racketeering activity to acquire an interest in an enterprise affecting commerce, (2) acquiring or maintaining an interest in an enterprise through a pattern of racketeering activity, (3) conducting the affairs of an enterprise through a pattern of racketeering activity and (4) conspiring to commit any of these offenses.

2C RICO has expanded the "enterprise as defendant" concept by expanding the definition of "person" to include an "enterprise as defined herein", which language is not found in the federal act. Under 2C RICO, a "person" may also be an "enterprise", therefore eliminating the need for civil plaintiffs to identify a separate enterprise through which prohibited activity was conducted. See Hirsch v. Enright Refining Co., Inc., 751 F.2d 628 (3 Cir.1984), (holding that enterprise and defendant must be separate under federal RICO).

In its definition of "enterprise", 2C RICO also includes "illicit as well as licit enterprises and governmental as well as other entities". This language is not found in federal RICO, and is the precise issue that the Supreme Court resolved in U.S. v. Turkette, 452 U.S. 576, 101 S. Ct. 2524, 69 L. Ed. 2d 246 (1981). Further evidence of the broader scope of 2C RICO can be found in the its use of the term "crime-type activities", thereby precluding any doubts over whether enterprises formed wholly for unlawful purposes are included in its ambit.

2C RICO adds the requirement that to establish a "pattern of racketeering activity", there must be a "showing that the incidents of racketeering activity embrace criminal conduct that has either the same or similar purposes, results, participants or victims or methods of commission or are otherwise interrelated by distinguishing characteristics and are not isolated incidents", 2C:41-1(d)(2). This language is not found in the definitional sections of federal RICO, and reflects a legitimate legislative

expression that 2C RICO is designed to be more than a repeat offender statute.

2C RICO prohibits the use of the proceeds of an "unlawful debt" for the acquisition, establishment, maintenance or control of an "enterprise which is engaged in or activities of which affect [the] trade or commerce of New Jersey." N.J.S.A. 2C:41-2.

In a section prohibiting investment of racketeering income in an enterprise, 2C RICO adds the following statutory presumption, which is really a permissive inference: if "it is established that over half of the defendant's aggregate income for a period of 2 or more years immediately preceding the investment was derived from a pattern of racketeering activity," then the "investment included income derived from a pattern of racketeering activity". This provision is not found in federal RICO and ...


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