Clarification of Answer by
pafalafa-ga
on
31 Aug 2006 16:12 PDT
No prob.
===================
UNITED STATES OF AMERICA, Plaintiff, v. FRANK COSOLITO, Defendant.
Crim. No. 79-436-C
UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS
488 F. Supp. 531; 1980
MEMORANDUM
This matter came before the Court on defendant Frank Cosolito's motion
to dismiss a three-count indictment; an evidentiary hearing was held.
The indictment charges that Cosolito and co-defendant Ralph Russo
conspired to and, on December 9, 1974, gave money to two officials of
the United States Internal Revenue Service in order to influence them
to "fix" an outstanding tax liability of Cosolito, in violation of 18
U.S.C. § 201(b)(2) and 18 U.S.C. § 371. The indictment was returned by
the grand jury on December 4, 1979, a few days before the five-year
statute of limitations, 18 U.S.C. § 3282, was to expire, whereupon, on
application of the government and by order of this Court, the
indictment was sealed until February 4, 1980. Cosolito asserts two
grounds for dismissal. First, he contends that the almost five-year
delay between the commission of the crime and the return of the
indictment [**2] violated his rights under the Due Process Clause of
the Fifth Amendment. Second, he contends that the indictment was
improperly sealed for a period beyond the statute of limitations.
After hearing, I find the relevant facts to be as follows. On December
9, 1974, defendant Cosolito had a meeting with Richard Annicharico,
Special Agent, Internal Revenue Service, and Edward Finn, Revenue
Officer, Internal Revenue Service, at a coffee-shop in Logan Airport,
Boston, Massachusetts. At that time, Cosolito gave $ 3,500.00 to
Annicharico and Finn in order to influence them to certify that an
investigation into the tax liability of Cosolito for the years 1964 up
to and including 1969, 1972, and 1973 was discontinued and that an
outstanding liability to the United States of approximately $ 30,000
in unpaid taxes, penalties, and interest payments was extinguished.
There was evidence that Cosolito generated the unreported income in
illegal bookmaking activity. Annicharico, who was attached to the IRS
office in New York, and Finn, who was attached to the IRS office in
Boston, were posing as corrupt IRS agents.
Agent Annicharico testified that he first met defendant Russo at a
meeting November [**3] 1, 1974 at an airport in New York City. That
meeting was arranged by one John Ellsworth, a government informant.
Ellsworth was present at the November 1 meeting, but sat down at a
different table after introducing Russo and Annicharico. It appears
that Russo was acting as an intermediary for Cosolito.
Agent Annicharico testified that he first met defendant Cosolito at a
meeting held later in November at Logan Airport. Also present at that
meeting were Agent Finn [*533] and defendant Russo. Ellsworth was
not present at that meeting.
After the December 9, 1974 meeting during which the bribe was made,
Agent Annicharico had several more telephone conversations with
Cosolito. Annicharico testified that these conversations were usually
initiated by calls from Cosolito to Annicharico's office in New York.
The last conversation took place in March of 1976. Annicharico stated
that one purpose of the calls was Cosolito's desire to have a tax lien
removed on his house. He also testified that there had been no mention
of the tax lien until the December 9 meeting. A review of the
transcript of that meeting reveals that Cosolito was informed by
Agents Finn and Annicharico that although [**4] the liens would not
be removed right away, they would be removed shortly thereafter since
the cases were now closed. There was also testimony that Cosolito
possibly had a second purpose for calling Annicharico to introduce
Annicharico to other persons seeking to have their tax problems
solved. Annicharico testified that there was discussion at the
December 9, 1974 meeting about Cosolito introducing Annicharico to
friends who needed tax help, but it is unclear whether it was Cosolito
or Annicharico who initiated this discussion. After that discussion,
according to Annicharico's testimony, Cosolito called him in April of
1975 to arrange a tax fix for some "politician." From the transcript
of that conversation, dated April 15, 1975, it appears that Cosolito
made only a passing reference to this politician in response to a
question by Annicharico as to whether Cosolito had any friends that
needed help. Moreover, from the context of the conversation it appears
equally likely that Cosolito misunderstood the question and was
referring to a politician who could help him or his friends rather
than a politician who needed help. In any event, the government has
not convinced me that Cosolito [**5] attempted in any significant way
to introduce other persons to Annicharico. And, I find that after
March of 1976 he had no contact with Annicharico at all.
From December 1974 to June 1977, Agent Annicharico was not involved in
any substantial undercover investigations, although he did testify he
undertook some "spot work." Starting in June 1977, however,
Annicharico became involved in an undercover capacity in an
investigation in Brooklyn, New York. The Internal Security Division of
the IRS had received information that one Victor Puglisi, negotiating
on behalf of others, was seeking to offer a bribe with respect to a
tax investigation then being conducted by the IRS in the New York
area. Annicharico volunteered to pose as a corrupt government agent
and, on or about June 21, 1977, met and tape recorded a conversation
with Puglisi in which Puglisi asked Annicharico if he would compromise
an investigation into tax violations by one Andrew T. Russo (not
related to the defendant in this case). On January 12, 1978, Puglisi
did in fact pay Annicharico some $ 7,000 to "fix" the Russo tax
investigation.
Thereafter, Puglisi introduced Annicharico to many other individuals
interested in [**6] compromising their tax liability, some or all of
them members of a New York organized crime family. From June 21, 1977
to February 4, 1980, when the Brooklyn investigation ended,
Annicharico tape recorded and/or transmitted in excess of five hundred
conversations with Puglisi and those individuals to whom Puglisi
introduced him. There is no question that Annicharico was dealing with
extremely dangerous individuals and he testified that he has been
under 24 hour protection since the Brooklyn investigation ended with
the return of an indictment in February.
The person who first informed the IRS that Puglisi was interested in
compromising a tax investigation was John Ellsworth. Ellsworth did not
contact Annicharico directly but relayed the information to IRS
Inspector Harold Wenig. Annicharico testified that Ellsworth was not
present at the June 21, 1977 meeting between Annicharico and Puglisi.
Puglisi knew Annicharico had engaged in a corrupt deal in Boston.
Annicharico testified that, over the course of his dealing [*534]
with Puglisi, Puglisi made it clear to him that he had learned of the
Boston deal from Ellsworth. Although there was also testimony by
Annicharico that [**7] Puglisi might have had an additional source,
someone described as a "half-assed wiseguy" who Puglisi either met in
Ellsworth's office or overheard Ellsworth telling that Annicharico did
some deals in Boston, later testimony established, and I find, that
this individual was not Cosolito or Russo.
With regard to Cosolito, Annicharico expressly testified that Cosolito
did not introduce him to Puglisi, and that Cosolito's name never came
up in his many discussions with Puglisi. Annicharico further testified
that he had no knowledge that Cosolito knew Puglisi or any of the
other subjects of the Brooklyn investigation. Annicharico also stated
that he could not recall whether Cosolito knew Ellsworth. Cosolito
himself took the stand and testified briefly that he had never met
Ellsworth or the subjects of the Brooklyn investigation.
At the hearing, the government placed great weight on the transcript
of a conversation between Annicharico and Puglisi, which occurred on
August 30, 1977, as indicating that it was either Cosolito or Russo
who told Puglisi about Annicharico. The relevant segment is as
follows:
PUGLISI: John (phonetic) Johns (Inaudible)
ANNICHARICO: (Inaudible)
[**8]
PUGLISI: (Inaudible) in his office over there, he had somebody up
there, and said a half-assed wise guy.
ANNICHARICO: What office in the city?
PUGLISI: Yeah and I understand your name came up, did he ever ask you
to come up (Inaudible) a guy from Boston?
ANNICHARICO: Yeah.
PUGLISI: That's (Inaudible)
ANNICHARICO: (Inaudible)
PUGLISI: See what I'm talking about, that's where it came from.
ANNICHARICO: (Inaudible) the guy made a mistake.
PUGLISI: See, he, he's the guy who told me about you.
ANNICHARICO: (Inaudible)
To the extent the above segment suggests that Puglisi learned about
Annicharico from a guy in Boston, if indeed it is at all
understandable, such a suggestion is not supported by Annicharico's
direct testimony as to the same conversation:
Q And during the first part of that meeting, can you state whether or
not Mr. Puglisi ever mentioned the city of Boston?
A Yes, he did, sir.
Q Okay.
When did he mention the city of Boston?
A Right at the beginning of the meeting, I would say.
We sat down and started some small talk and it seemed as [**9] though
he was trying to impress me that he had looked into my background a
little and he knew that I had done some deals in Boston.
Q Okay.
And what if anything did he say about Boston?
A He said that I met a guy up there in Boston.
Q Did he tell you how he knew you met a guy up there in Boston?
A Yes.
He heard of it in Mr. Ellsworth's office that I had been up in Boston to do a deal.
Q And did he mention anybody else he heard it from during that conversation?
A There was this unidentified person who he said, again, who talked
around at Ellsworth's office about myself doing a deal in Boston and,
of course, Mr. Ellsworth, I presume.
Based on Annicharico's direct testimony I find that the government had
no factual basis on which to represent to the Court that either
Cosolito or Russo informed Puglisi about Annicharico's deal in Boston.
[*535] Annicharico testified that he met the other subjects of the
Brooklyn investigation through Puglisi, not through Ellsworth. There
was also testimony from Attorney Joel Cohen of the Eastern District of
New York Strike Force that Ellsworth was generally unaware [**10]
that the investigation had branched out to other subjects.
The five-year statute of limitations was due to expire against
Cosolito and Russo on December 9, 1979. In a letter dated November 26,
1979, Attorney Joel Cohen advised the Boston Office of the Strike
Force that "the same undercover agent involved in your case, who held
himself out as a corrupt agent, has been involved in a related
undercover investigation with this Office for a period of
approximately two and one half years." The undercover agent referred
to is Agent Annicharico. The letter further advised that the
investigation would continue for approximately two more months and
warned that a public filing of an indictment would "disclose to the
subjects of our investigation the true nature of their dealings with
the undercover agent, i. e. they still believe he is corrupt and will
realize he has been an undercover operative. This disclosure will
arise from the fact that the informant who led the undercover agent to
the subjects of your investigation is the same informant that led us,
perhaps inadvertently, to the subjects of our investigation." The
undercover informant referred to is John Ellsworth. Thus, the critical
[**11] concern expressed in the November letter is that the
disclosure of Ellsworth's status as an informant would lead in turn to
disclosure of Annicharico's undercover status.
On December 4, 1979, the grand jury returned the three-count
indictment against Cosolito and Russo. On December 5, Attorney Stanley
Greenidge of the Boston Strike Force applied for an order, pursuant to
Rule 6(e)(4) of the Federal Rules of Criminal Procedure, directing
that the indictment be sealed until January 8, 1980. As reason
therefore, the application stated that the case was "closely related"
to the Brooklyn undercover investigation. The application advised that
the public filing of the Cosolito and Russo indictment would disclose
the investigation in Brooklyn to the subjects of that investigation
because "the same undercover agent was utilized in both investigations
and the introduction of that undercover agent to the subjects of the
New York investigation was accomplished by the defendants FRANK
COSOLITO and RALPH RUSSO." The critical concern expressed in the
application for sealing is different from that given in the letter
from the New York office, in that the common link between the two
investigations [**12] is stated to be defendants Cosolito and Russo,
not the informer Ellsworth. The letter from Cohen was attached as an
exhibit to the application.
The application for sealing was allowed on December 6, 1979. On
January 8, 1980, when the order sealing the indictment was to expire,
the Government applied for, and the Court allowed an extension of the
order until February 4, 1980, the date when the indictment was
ultimately unsealed.
Much of the evidence introduced by Cosolito at the hearing was
directed toward establishing the status of John Ellsworth as a
well-known government informant. Cosolito first introduced a tape of
the ABC news program "20/20" broadcast on July 19, 1979. That
particular broadcast devoted approximately twenty minutes to John
Ellsworth, detailing his connection with a national swindle called the
International Children's Appeal, a scheme to "rip off" the
International Year of the Child which was stated to have "conned" such
people as Rosalynn Carter and Senator Edward Kennedy. The "20/20"
program also described Ellsworth's activities as a government
informant. The following excerpts give the basic flavor of the
commentary by reporter Dave Marash:
Make [**13] no mistake about it. John Ellsworth is an acknowledged
federal informant and confidential sources tell us he has maintained
close contact with representatives of at least two federal law
enforcement agencies, the Drug Enforcement Administration, which
admits he works for them, at least through last June, and the Justice
Department, which [*536] apparently took over paper responsibility
for Ellsworth after that.
This may be the most astonishing part of his career. He's done this
several times before. He has been a very important source of
information for agencies of the federal government, and information
that he has passed along has apparently helped the government build
several major cases over the last five or six years.
Cosolito next introduced an article from the October 3, 1979 issue of
the Long Island New York newspaper "Newsday" which identified
Ellsworth as a government informant. The article reported the slaying
of two mobsters which allegedly took place as a direct result of the
"20/20" program exposing the International Children's Appeal and
Ellsworth. Cosolito also introduced a copy of the "VIP" column from
the December 2, 1979 issue of the Washington [**14] Post describing
in great detail Ellsworth's activities. The following excerpt is
particularly relevant:
John Ellsworth does not like the word "informant." He prefers to
describe himself as someone who has "cooperated" in the past with
government investigators. He said he has "cooperated" at one time or
another with the Secret Service, the Federal Bureau of Investigation,
the Internal Revenue Service, the Drug Enforcement Agency, the Central
Intelligence Agency and the Organized Crime Strike Force in the
Eastern District of New York. . . . The government has been making a
lot of cases against Ellsworth's former friends and associates.
Sixteen of them were indicted in New York in April on conspiracy
charges involving marijuana, cocaine and hashish.
Finally, Cosolito introduced a copy of United States v. Russo, 540
F.2d 1152 (1st Cir.), cert. denied, 429 U.S. 1000, 97 S. Ct. 529, 50
L. Ed. 2d 611 (1976), a case in which Ellsworth's name is prominently
mentioned as an alleged government informant. The defendant in that
case is Cosolito's co-defendant here and was convicted of crimes
arising out of dealings with Ellsworth.
At the hearing, Attorney Joel Cohen conceded that [**15] he was aware
of the exposure of Ellsworth as a government informant when he
requested that the indictment be sealed.
I now turn to Cosolito's assertion that the preindictment delay in
this case deprived him of due process. Although statutes of limitation
provide the primary guarantee against overly stale criminal charges,
the Supreme Court has held that the Fifth Amendment does have a
limited role to play where the defendant can demonstrate actual
prejudice and the government delay was unreasonable. United States v.
Lovasco, 431 U.S. 783, 789-90, 97 S. Ct. 2044, 2048, 52 L. Ed. 2d 752
(1977); United States v. Marion, 404 U.S. 307, 324-25, 92 S. Ct. 455,
465, 30 L. Ed. 2d 468 (1971). However, proof of actual prejudice is a
"generally necessary" threshold requirement which must be satisfied
before a court need inquire into the reasons for delay. See Lovasco,
supra, 431 U.S. at 789-90, 97 S. Ct. at 2048; United States v.
Lieberman, 608 F.2d 889, 902 (1st Cir.), cert. denied, 444 U.S. 1019,
100 S. Ct. 673, 62 L. Ed. 2d 649 (1979). Cosolito's only claim of
prejudice is a conclusory statement that he can no longer remember how
his tax liability was computed. Prescinding from the question [**16]
whether that computation is even material to his present prosecution
for bribery, I rule that Cosolito's alleged lack of memory, without
more, is not sufficient actual prejudice to require further due
process inquiry. United States v. Ramos, 586 F.2d 1078, 1079 (5th Cir.
1978). Therefore, Cosolito's motion to dismiss the indictment on Fifth
Amendment grounds should be denied.
That leaves for resolution Cosolito's contention that the indictment
was improperly sealed. Rule 6(e)(4) provides:
"(4) Sealed Indictments. The federal magistrate to whom an indictment
is returned may direct that the indictment be kept secret until the
defendant is in custody or has been released pending trial. Thereupon
the clerk shall seal the indictment and no person shall disclose the
return of the indictment except when [*537] necessary for the
issuance and execution of a warrant or summons."
Cosolito argues that Rule 6(e)(4) represents an exception to the
statute of limitations and should be strictly construed. Therefore,
defendant concludes, Rule 6(e)(4) only authorizes the government to
seal an indictment in order to obtain custody of a defendant who
otherwise might flee.
There have [**17] been few reported cases on the reasons for which
the government may properly seal an indictment for a period beyond the
statute of limitations. One case has suggested that the only valid
reason for sealing is the one set forth in Rule 6(e)(4), that is,
obtaining custody over the defendant. United States v. Sherwood, 38
F.R.D. 14, 20 (D.Conn.1964). Another case has held that the government
may legitimately seal an indictment in situations where it is able to
locate and gain custody over some, but not all, co-defendants named in
an indictment. United States v. Watson, 599 F.2d 1149, 1155 (2d Cir.
1979). Still another case has suggested a much broader interpretation
of Rule 6(e)(4), that the government may licitly seal an indictment
for prosecutorial reasons other than gaining custody over a defendant
or co-defendant. United States v. Heckler, 428 F. Supp. 269, 271-72
(S.D.N.Y.1976); see also United States v. Michael, 180 F.2d 55, 57 (3d
Cir. 1949), cert. denied, 339 U.S. 978, 70 S. Ct. 1023, 94 L. Ed. 1383
(1950).
The reasons set forth by the government in its application for sealing
concededly have nothing to do with gaining custody over defendants
Cosolito and Russo. I do not [**18] reach, however, the legal
question whether the reasons given by the government in support of its
request to seal would be valid reasons if factual, because after the
evidentiary hearing I find those alleged reasons not to be factual and
I rule therefore that the sealing authorized on the basis of
misstatements as to the true facts was improper. As the court stated
in Watson, supra, "even if the defendant shows no prejudice, delay in
unsealing the indictment would be unreasonable if there were no
legitimate prosecutorial need for it." 599 F.2d at 1156 n.4.
In finding no factual basis for sealing the indictment, I start with
the specific reason stated by Attorney Greenidge in his application
that Russo and Cosolito were the common link with the Brooklyn
investigation. I am satisfied by the evidence adduced at the hearing,
and find, that the government knew that Cosolito and Russo did not
introduce Agent Annicharico to the subjects of the Brooklyn
investigation. Therefore I rule that the reason stated in the
application was not in fact a proper basis for sealing. There remains
the reason stated by Attorney Cohen in his letter of November 26, 1979
that exposure of informant John Ellsworth [**19] would prejudice the
Brooklyn investigation. I find that, based on the television and
newspaper reports described above and the opinion of the Court of
Appeals in Russo, supra, the status of Ellsworth as a government
informant must have been and in fact was common knowledge after July
1979 to anybody who had reason to take an interest in that matter.
Therefore, I rule that the reason set forth in Cohen's letter was not
a proper factual basis for sealing the indictment. Since I find that
neither of the grounds asserted by the Government for sealing the
indictment are supported by the evidence, the indictment should be
dismissed.
It should be noted that, even assuming there was a relationship
between the two investigations, the government as a practical matter
created its own exigent circumstances which it claims required the
indictment to be sealed. The government knew the full details of
Cosolito's and Russo's criminal activity on the very day the bribe was
paid and delayed indicting Cosolito and Russo on the vague hope that
Cosolito would lead them to other subjects. For over two and one-half
years after the bribe was paid, Annicharico was not involved in
undercover activity [**20] and the government apparently had a
complete case against Cosolito and Russo. Furthermore, the government
has not attempted to demonstrate that there was any shortage of
manpower to prosecute the case. Compare United [*538] States v.
Shaw, 555 F.2d 1295, 1299 (5th Cir. 1977). It was not until
Annicharico coincidentally became involved in an undercover capacity
in a separate and unrelated investigation that the alleged need for
secrecy arose. To allow the government in these circumstances to
extend the statute of limitations, even for a short period of time,
would seriously undermine the role which statutes of limitations have
traditionally served in protecting criminal defendants against the
power of the government. See United States v. Sherwood, 38 F.R.D. 14,
20 (D.Conn.1964).
Order accordingly.
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