US v. Frega

• Decision Date: 08 June 1999
• Docket Number: No. 97-50100,97-50111,97-50113 and 97-50171.,97-50100
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Patrick R. FREGA, Defendant-Appellant. United States of America, Plaintiff-Appellee, v. James Alan Malkus, Defendant-Appellant. United States of America, Plaintiff-Appellee, v. G. Dennis Adams, Defendant-Appellant. United States of America, Plaintiff-Appellant, v. Patrick R. Frega; James Alan Malkus; G. Dennis Adams, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

179 F.3d 793

UNITED STATES of America, Plaintiff-Appellee, v. Patrick R. FREGA, Defendant-Appellant.

United States of America, Plaintiff-Appellee, v. James Alan Malkus, Defendant-Appellant.

United States of America, Plaintiff-Appellee, v. G. Dennis Adams, Defendant-Appellant.

United States of America, Plaintiff-Appellant, v. Patrick R. Frega; James Alan Malkus; G. Dennis Adams, Defendants-Appellees.

Nos. 97-50100, 97-50111, 97-50113 and 97-50171.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted November 4, 1998.

Filed June 8, 1999.

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Henry H. Rossbacher (argued), Rossbacher & Associates, Los Angeles, California; John Y. Tremblatt, San Diego, California; Nicholas DePento, San Diego, California, for defendant-appellant-cross-appellee Patrick R. Frega.

Ezekiel E. Cortez, Aaron & Cortez, San Diego, California, for defendant-appellant-cross-appellee James Alan Malkus.

Mario G. Conte, Federal Defenders of San Diego, San Diego, California, for defendant-appellant-cross-appellee G. Dennis Adams.

Demetra Lambros (argued), United States Department of Justice, Washington, D.C.; Charles G. La Bella, Acting United States Attorney, San Diego, California; Stephen P. Clark, Phillip L.B. Halpern, Kevin J. Kelly, Thomas W. McNamara, Assistant United States Attorneys, San Diego, California, for the plaintiff-appellee-cross-appellant.

Daniel J. Popeo, Paul D. Kamenar, David M. Young, Washington, DC, for amicus curiae Washington Legal Foundation, in support of plaintiff-appellee.

Before: BRIGHT,^** REINHARDT, and RYMER, Circuit Judges.

Sections I, VI and VII were authored by Judge REINHARDT; sections II, III, IV, V and VIII by Judge RYMER; Partial Concurrence and Partial Dissent by Judge RYMER.

Attorney Patrick Frega and former California Superior Court judges James Malkus and Dennis Adams appeal their convictions following a jury trial for conspiring to conduct the affairs of the San Diego Superior Court through a pattern of racketeering activity in violation of the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. § 1962(d), and for mail fraud in violation of 18 U.S.C. §§ 1341 and 1346. Frega also appeals his conviction for conducting the affairs of the Superior Court through a pattern of racketeering activity in violation of RICO, 18 U.S.C. § 1962(c). The government cross-appeals the sentences imposed. We affirm the mail fraud convictions as to all three defendants as well as Frega's substantive RICO conviction, reverse the RICO conspiracy convictions, and deny the cross-appeal. We remand for reconsideration of the defendants' sentences in light of our decision.

I

This case involves allegations of numerous bribes paid by Patrick Frega, a San Diego attorney, to three then Superior Court judges, Dennis Adams, James Malkus, and Michael Greer. Over a period of twelve years, Frega, together with Jim Williams, the owner of a San Diego car dealership, purportedly gave more than $100,000 in payments and benefits—ranging from automobiles, car repairs, money orders, an apartment, health club memberships, and a queen-sized bed—to the judges or members of their families. In exchange, Frega allegedly sought and received an unfair advantage in the cases in which he was involved in the Superior Court.

In June of 1996, after Greer became a witness for the prosecution, a grand jury returned a twenty-one count indictment against Frega, Malkus and Adams.¹ The Indictment charged all three with RICO conspiracy in violation of 18 U.S.C. § 1962(d) ("Count One"). This charge was based on allegations that the three defendants had conspired to conduct the affairs of the Superior Court through a pattern of racketeering activity consisting of multiple acts of bribery in violation of Sections 92 and 93 of the California Penal Code and extortion in violation of 18 U.S.C. § 1951. Frega, Adams and Malkus were also charged with eighteen counts of mail fraud in violation of 18 U.S.C. §§ 1341 and 1346. The mail fraud counts specifically related to mailings done in furtherance of the defendants' alleged scheme to defraud the people of the State of California by depriving them of their right to the honest services of judges of the Superior Court. Most of the mailings listed in the Indictment related to an investigation of the defendants' actions conducted by the California Commission on Judicial Performance and involved documents sent to the Commission by Frega and the judges.² A few related to proceedings in the Superior Court. Additionally, the grand jury charged Frega with a substantive RICO offense in violation of 18 U.S.C. § 1962(c), and with forfeiture allegations pursuant to 18 U.S.C. § 1963. The substantive RICO charge alleged that Frega not only conspired to conduct the affairs of the Superior Court through his bribes, as charged in Count One, but that he in fact succeeded in doing so.

During a thirty-day jury trial, Malkus was the only defendant to take the stand. He professed complete ignorance of Frega's various expenditures on behalf of himself and his family. Adams, through counsel, acknowledged receiving Frega's many payments and benefits, but contended that he did so without corrupt intent. It was Frega's defense that his gifts to the judges were just that, gifts not bribes, conferred out of friendship and generosity.

The jury found Frega, Malkus, and Adams guilty of the RICO conspiracy charge. Frega was convicted on thirteen mail fraud counts, Adams of five such counts, and Malkus of six. The jury also found Frega guilty of committing the substantive RICO offense. The district court sentenced Frega and Adams to forty-one months imprisonment, and Malkus to thirty-three months.

Each appeals his conviction, raising myriad claims of error. The government cross-appeals the district court's application of the bribery guidelines and its refusal to adjust Frega's offense level upward for being a leader or organizer under U.S.S.G. § 3B1.1(a). We first analyze the defendants' claims and then the government's cross-appeal.

II

Frega claims that he was denied due process in the resolution of his claim of prosecutorial conflict of interest. Prior to indictment, Frega filed a motion to recuse the U.S. Attorney's Office on the ground that one of the attorneys in the office, Assistant U.S. Attorney Michael Dowd, had represented Frega before the Judicial Commission with respect to this case and had joined the law firm that represented Greer before the Commission. The district court found that an evidentiary hearing was unnecessary as Frega provided no evidence to believe that any disclosure by Dowd had occurred, or that the fire-wall built around the investigation before Dowd joined the office, or the office-wide screen that had been established specifically for Dowd after it was learned that Dowd was conflicted, was in any way breached. District judges have "substantial latitude" in deciding whether counsel must be disqualified, and we see no abuse of discretion. United States v. Stites, 56 F.3d 1020, 1024 (9th Cir.1995).

Declarations from those in charge of the investigation representing that they had received no information from Dowd, and that they had directed others working on it not to speak to Dowd, were uncontradicted. That the government did not submit a declaration from Dowd himself does not change the analysis. The U.S. Attorney's Office believed it would breach the fire-wall for any of its attorneys to obtain a declaration from Dowd, but the government did recommend that the court ask for one should any questions remain. In any event, Frega knew what Dowd knew and could have specified which broken confidences, if any, were suggested by the government's submissions. On the record adduced, there is no reasonable possibility of prejudice to the verdict, and thus no due process violation. See United States v. Velasquez-Carbona, 991 F.2d 574, 576 (9th Cir.1993).

III

Malkus suggests that his prosecution exceeds the bounds of federal authority under United States v. Lopez, 514 U.S. 549, 115 S.Ct. 1624, 131 L.Ed.2d 626 (1995), which he reads to indicate that it is up to the states to decide whether criminal sanctions are necessary in areas of traditional state concern such as the state judiciary.³ He also relies upon McNally v. United States, 483 U.S. 350, 107 S.Ct. 2875, 97 L.Ed.2d 292 (1987), which he reads as holding that Congress must clearly state that it seeks to regulate the conduct of state officials. The short answer is that RICO explicitly makes it unlawful to agree to conduct an enterprise through predicate acts of state criminal violations, such as bribery. 18 U.S.C. § 1961(1)(A). As we recently noted:

That RICO embodies a fundamental federal policy can scarcely be disputed. . . . RICO represents a fundamental choice by Congress to employ the heavy artillery of federal law against a variety of organized criminal endeavors involving security fraud, wire fraud, and bribery.

Govett Am. Endeavor Fund Ltd. v. Trueger, 112 F.3d 1017, 1021-22 (9th Cir.1997). Moreover, we have often affirmed RICO convictions involving bribery of state officials, see, e.g., Jackson, 72 F.3d at 1373 (bribery of state senator); United States v. Dischner, 974 F.2d 1502, 1506-08 (9th Cir. 1992) (bribery of a mayor), as have other circuits, see, e.g., United States v. Griffith, 85 F.3d 284, 288 (7th Cir.), cert. denied, 519 U.S. 909, 117 S.Ct. 272, 136 L.Ed.2d 195 (1996) ("bribery of local . . . officials is just the sort of corruption connoted by the term `racketeering'"), and the United States Supreme Court, see Salinas v. United States, 522 U.S. 52, ___ - ___, 118 S.Ct. 469, 472-73, 139 L.Ed.2d 352 (1997) (upholding RICO conspiracy convictions of deputy who accepted bribes from prisoners in county jail).

Beyond this, Malkus contends that RICO is facially unconstitutional under Lopez. Lopez struck down the Gun-Free School Zones Act on...