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United States v. Delaurentis

January 25, 2000

UNITED STATES OF AMERICA
V.
JAMES V. DELAURENTIS



The opinion of the court was delivered by: Orlofsky, District Judge:

FOR PUBLICATION

HON. STEPHEN M. ORLOFSKY

OPINION

This case presents this Court with the first opportunity to apply the Third Circuit's recent decision in United States v. Zwick, No. 98- 3641, 1999 WL 1201443 (3d Cir. Dec. 15, 1999). In Zwick, the Third Circuit interpreted the Hobbs Act, which makes "bribe-taking" by local government officials a federal offense. The Hobbs Act applies where local government entities receive $10,000 or more in federal grant money. In Zwick, the Third Circuit held that local government officials can be prosecuted under the Hobbs Act only if some connection exists between the conduct with which the official is charged and the federal funds received by the government entity for which he or she works. See Zwick, 1999 WL 1201443, at *11.

In this case, James V. DeLaurentis ("DeLaurentis"), the Supervising Detective of the Hammonton Police Department in Hammonton, N.J., is charged with multiple counts of extortion and bribery. DeLaurentis has moved to dismiss Counts Two and Six of the indictment which allege Hobbs Act violations on the ground that a sufficient connection did not exist between the bribes he allegedly accepted and the federal grant money received by the Hammonton Police Department in the year in which the bribes were purportedly paid to him. DeLaurentis also moves to compel disclosure of the grand jury proceedings in this case because he contends that such disclosure is necessary to determine whether the grand jury was presented with sufficient evidence to determine whether a connection existed between DeLaurentis's alleged conduct and the federal grant money received by the Hammonton Police Department. Construing Zwick, I find that a sufficient connection did not exist between the bribes DeLaurentis allegedly received and the federal grant money given to the Hammonton Police Department. Accordingly, I shall grant DeLaurentis's motion to dismiss Counts Two and Six of the indictment which charge Hobbs Act violations. In light of my dismissal of the Hobbs Act violations, I find that DeLaurentis's motion to compel disclosure of the grand jury proceedings in this case is now moot. Accordingly, I shall deny DeLaurentis's motion to compel disclosure of the grand jury transcripts.

The Government also moves in limine to admit certain evidence of bad acts by DeLaurentis. For the reasons set forth below, I shall grant the Government's motion in part and deny it in part.

I. Factual and Procedural History

On July 27, 1999, DeLaurentis was indicted on four counts of extortion in violation of 18 U.S.C. § 1951 *fn1 and two counts of soliciting and accepting bribes in violation of 18 U.S.C. § 666, *fn2 commonly known as the Hobbs Act. See Indictment (filed July 27, 1999). The allegations that form the basis of this indictment stem from four separate incidents, each involving the Choris Bar -- a local Hammonton watering hole.

The first incident relates to an exchange of money for influence. The Government claims that DeLaurentis solicited and received $5,000 from the owner of the Choris Bar in exchange for his help in obtaining a renewal of the bar's liquor license. See Indictment, Cts. One-Two; Criminal Compl., Attach. B (filed June 17, 1999). The Government alleges that when the bar applied to the Mayor of Hammonton and the Hammonton Town Council to have its liquor license renewed in July, 1995, the Mayor and the Town Council denied the bar's application based on reports that the bar served alcohol to minors. See Criminal Compl., Attach. B. The Government contends that DeLaurentis then made an offer to the owner of the Choris Bar to intercede with Hammonton officials on the bar's behalf in exchange for $5,000. See id. The Government maintains that the owner of the Choris Bar subsequently paid DeLaurentis the $5,000 and that DeLaurentis, having accepted the money, wrote a letter to Hammonton officials urging that the officials reach a settlement with the owner of the Choris Bar. See id. The Government states that the bar's liquor license was subsequently renewed. See id.

This was not the last time that DeLaurentis sold influence for cash, according to the Government. The Government charges that on a separate occasion -- after a food vendor on the premises of the Choris Bar was issued a citation for serving food without the requisite license -- the owner of the bar paid DeLaurentis an estimated $1,000 to intervene with Hammonton officials on behalf of the vendor. See Indictment, Ct. Four; Criminal Compl., Attach. B. It is alleged that although the vendor was subsequently fined, the vendor did not lose his license. See Criminal Compl., Attach. B.

The Government further alleges that DeLaurentis not only sold influence for cash, but also extracted money from the owner of the Choris Bar by making threats. Specifically, the Government maintains that DeLaurentis elicited a $2,000 pay-off from the owner of the Choris Bar by threatening to file a false police report. See Indictment, Ct. Three; Criminal Compl., Attach. B. According to the Government, DeLaurentis arrested an employee of the Choris Bar on July 11, 1996, for selling drugs. See Criminal Compl., Attach. B. The employee had been selling drugs out of his own home. See id. The Government contends that DeLaurentis nevertheless approached the owner of the Choris Bar and threatened to file a police report stating that the arrested employee had been selling drugs from the bar. See id. The Government asserts that because such a report of drug sales at the bar would adversely affect the status of the bar's liquor license, the owner of the Choris Bar paid DeLaurentis approximately $2,000 to prevent him from filing the false police report. See id.

In a later, unrelated incident, the Government alleges that DeLaurentis threatened to inform Hammonton officials about various wrongdoings at the Bar and received approximately $6,000 from the owner of the Choris Bar for not acting on the threats. See Indictment Cts. Five-Six; Criminal Compl., Attach. B.

On October 15, 1999, DeLaurentis filed a motion to dismiss the two Hobbs Act Counts of the indictment (Counts Two and Six) and to compel disclosure of the grand jury proceedings in this case. See Notice of Mot. of DeLaurentis (filed Oct. 15, 1999). The two Hobbs Act Counts concern the alleged receipt of $5,000 by DeLaurentis for his role in securing the renewal of the Choris Bar's liquor license and the alleged receipt of $6,000 by DeLaurentis for abandoning his threat to report the Choris Bar for various wrongdoings. See id.; Indictment, Cts. Two, Six. DeLaurentis moves to compel disclosure of the grand jury proceedings on the theory that such disclosure will reveal whether or not the Government presented sufficient evidence to the grand jury to demonstrate that a connection existed between the federal money received by Hammonton and the bribe money allegedly accepted by DeLaurentis. See Def.'s Br. Supp. Pre-Trial Mots. at 9 (Received Oct. 15, 1999). On the same day, the Government filed a motion to admit evidence concerning other bad acts by Defendant DeLaurentis. See Notice of Mot. of Government (filed Oct. 15, 1999). These motions are currently before the Court. I have jurisdiction in this matter under 18 U.S.C. § 3231. *fn3

II. Discussion

A. DeLaurentis's Motion to Dismiss the Hobbs Act Counts

DeLaurentis moves to dismiss both Hobbs Act Counts of the indictment, Counts Two and Six. Among other things, the Hobbs Act makes it unlawful for an agent of a local Government which receives $10,000 or more in federal funding to accept something of value worth $5,000 or more with the intent to be influenced or rewarded "in connection with any business [of such] Government." The dispute between DeLaurentis and the Government revolves around the Hobbs Act's "in connection with" language. DeLaurentis argues that there must be some connection between the offense committed by a local Government actor and the federal funding received by the Government entity for which he or she works to prove a violation of the Hobbs Act. See Def.'s Br. Supp. Pre-Trial Mots. at 6-9. DeLaurentis asserts that no such connection existed in this case. See id. at 6, 8-9. The Government, on the other hand, interprets the statute's "in connection with" language to mean that no connection needs to be established between the offense and the funding and that the Hobbs Act charges in the indictment should survive DeLaurentis's motion to dismiss. See Government's Resp. at 5-9 (received Nov. 3, 1999). In the alternative, the Government argues that if such a connection is required, a sufficient connection existed in this case for the charges to go forward. See id. at 10-12.

1. The Zwick Decision

The Third Circuit recently considered the issue of whether the Hobbs Act requires a connection to be established between federal funds allocated to a local Government entity and a bribe received by an official of that entity in United States v. Zwick, No. 98-3641, 1999 WL 1201443 (3d Cir. Dec. 15, 1999). *fn4 In Zwick, the defendant (Zwick) was an elected member of Ross Township Board of Commissioners, the governing body of Ross Township, Pennsylvania. See id. at *1. He was convicted under the Hobbs Act for receiving bribes from building developers in exchange for helping them obtain sewer access and use permits from the Township and for enabling a landscaper to obtain a contract with the Township. See id. at *2-4. During the period in which Zwick solicited these bribes, Ross Township received federal funds that were used for emergency snow removal and as part of a program to prevent stream bank erosion. See id. at *12.

The Third Circuit vacated Zwick's conviction, ruling that a connection must be established between a Government official's offense conduct and federal funds received by the Government entity for which he or she works for a Hobbs Act prosecution to be successful. See id. at *11. The court held that an insufficient connection existed between the federal funds used by Ross Township for snow removal and to combat stream bank erosion and the bribes received by Zwick in exchange for sewer access, use permits, and landscaping contracts. See id. at *12. In reaching this conclusion, the Third Circuit noted that although Congress intended the Hobbs Act to broaden the reach of federal power to combat bribery -- the reach of the federal anti-bribery statute that predated the Hobbs Act was limited by tracing requirements -- the ultimate objective of the Hobbs Act was to protect the integrity of federal funds. See id. at *9-10. "The goal [of the Hobbs Act] was to overcome impediments to reaching actions in which there was a federal interest, not to federalize crimes in which a federal interest was lacking." Id. at *9. Absent a clear congressional directive that the Hobbs Act was enacted to redress all bribery by officials of local Governments which receive some federal aid, the Third Circuit held that some connection between the bribe paid and the federal funds received had to be established. See id. at *8, *11.

The Third Circuit engaged in an extensive review of the relevant case law. Several courts across the country had interpreted Congress's intent to broaden federal bribery-fighting powers to mean that a connection between the bribe money taken and federal funds received need not be established. See id. at *5, *7. Other courts, however, found that a lack of such connection raised federalism concerns, with some courts finding that it would be unconstitutional for federal bribery prosecutions to proceed against local Government officials where the officials' conduct was unconnected to the federal funds received. See id. at *5-7. In Salinas v. United States, 522 U.S. 52, 118 S.Ct. 469 (1997), the Supreme Court held that a successful Hobbs Act prosecution did not depend on a demonstration that federal funds were actually involved in or affected by an alleged act of bribery. See Zwick, 1999 WL 1201443, at *6 (citing Salinas, 118 S.Ct. at 472-73). The Court, however, left open the question of whether some other connection between federal funds and the act of bribery needed to be shown because any such connection would obviously have been met under the facts of that case: A local sheriff accepted bribes concerning a federal prisoner housed in a local jail pursuant to a federal program. See id. (citing Salinas, 118 S.Ct. at 474-75). The Third Circuit ultimately sided with those courts requiring that a connection be shown, concluding that the balance of federal and state powers would be threatened by allowing Hobbs Act prosecutions to proceed where no connection existed between a bribe accepted by a Government official and the federal funds received by the Government entity for which that official worked. See id. at *11. Acts of bribery addressed by state statute, concerning matters of local concern, and implicating a limited federal interest would be criminalized under federal law otherwise, and the Third Circuit was unwilling to construe the Hobbs Act in a way that held such potential to encroach on the police powers of local Governments or stretch Congress's authority under the Spending Clause of the Constitution so thinly. See id.

Finally, the Third Circuit's decision was guided by canons of statutory interpretation. Finding that ambiguity in the language of criminal statutes should be resolved in favor of defendants and should be construed in a way that avoids constitutional concerns and that statutes should not be interpreted in manner that significantly alters the federal-state balance absent clear congressional intent, the Third Circuit concluded: "We hold that S ...


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