U.S. v. Middlemiss, et al.
| Decision Date | 01 August 1999 |
| Docket Number | 99-1108,Docket Nos. 99-1069,99-1109 |
| Citation | 217 F.3d 112 |
| Parties | (2nd Cir. 2000) UNITED STATES OF AMERICA, Appellee, v. THOMAS B. MIDDLEMISS, WILLIAM ORFANOS and SETIRI SOTIRIOU, Defendants-Appellants |
| Court | U.S. Court of Appeals — Second Circuit |
Appeal from United States District Court for the Southern District of New York (Sidney H. Stein, J.) convicting defendants Thomas B. Middlemiss, William Orfanos and Setiri Sotiriou on multiple charges of extortion, mail fraud and tax-related criminal offenses after a jury trial. Because sufficient evidence supported the convictions and the district court made no errors of law, we affirm the convictions and sentences.
Affirmed.
[Copyrighted Material Omitted]
[Copyrighted Material Omitted] DEBORAH A. SCHWARTZ, New York, NY, for Defendant-Appellant Thomas B. Middlemiss.
SPIROS A. TSIMBINOS, Kew Gardens, NY, for Defendant-Appellant Setiri Sotiriou.
KEVIN G. SNOVER, North Babylon, NY, for Defendant-Appellant William Orfanos.
JONATHAN N. HALPERN, Assistant United States Attorney, (Mary Jo White, United States Attorney, Ira M. Feinberg, Assistant United States Attorney, on the brief) New York, NY, for Appellee.
Before: KEARSE, PARKER, and POOLER, Circuit Judges.
Defendants Thomas B. Middlemiss, William Orfanos and Setiri Sotiriou appeal respectively from two February 2, 1999, judgments and a February 19, 1999, judgment of the United States District Court for the Southern District of New York (Sidney H. Stein, J.) following their convictions after a jury trial on multiple conspiracy, extortion, mail fraud and tax-related charges.
A 22-count superseding indictment filed on March 17, 1998, charged defendants with a lengthy extortion scheme victimizing George Lagaris. According to the government, Lagaris, who operated several restaurants including the New City Diner in Rockland County, knew Orfanos, who was a special agent in the U.S. Secret Service and assigned to the John F. Kennedy International Airport. In 1991, Lagaris and Orfanos did business together briefly when Lagaris helped Orfanos operate and sell a Dunkin Donuts franchise shop in Long Island that Orfanos owned with his brother. Also in 1991, Orfanos asked Lagaris if he was interested in operating a diner at the JFK Airport. Orfanos told Lagaris that he and Middlemiss, who worked at the airport, could obtain a lease for Lagaris' restaurant. Middlemiss was a public affairs officer for the Port Authority of New York & New Jersey, which operated the airport.
In exchange for their help in finding a location and obtaining a lease, Middlemiss and Orfanos wanted an interest in Lagaris' airport restaurant. Lagaris established a corporation, JFK Diner, Inc., in which Middlemiss and Orfanos each had a 12 " percent interest. The interest was held in the names of the wives of Middlemiss and Orfanos. Middlemiss and Orfanos originally wanted a total 20 percent interest in the business, but Lagaris increased the percentage to keep the math easier for him. Lagaris' own attorney initially drew up the corporate papers, but Lagaris later brought the legal work to Sotiriou at the suggestion of Orfanos. Sotiriou then transferred the wives' interests to his own name.
The airport diner never materialized. However, Middlemiss subsequently learned at a Port Authority staff meeting that airport officials planned to reopen an employee cafeteria. Middlemiss passed this information to Lagaris through Orfanos. Middlemiss also made several contacts with airport officials responsible for the project to recommend Lagaris for the cafeteria lease and to check on the lease approval process. Middlemiss never disclosed to airport officials his financial interest in Lagaris' corporation. Lagaris was the only candidate for the lease, which he obtained. After investing more than $85,000 in the project, Lagaris opened the cafeteria in December 1992.
Approximately seven weeks later, Orfanos during a meeting in Sotiriou's office demanded a $6,500 share of cafeteria profits from Lagaris, who refused and said the business was not yet profitable. After several discussions among Lagaris, Orfanos and Sotiriou, Lagaris agreed to pay $2,000 monthly to Middlemiss and Orfanos. The government contends that Lagaris made these payments because he was afraid that Middlemiss and Orfanos would interfere with his airport lease or cause tax and health department officials to investigate him, thereby costing Lagaris his substantial investment. Defendants claim that they were entitled to a share of the cafeteria profits as a result of their corporate interests. Lagaris made $2,000 monthly payments for 14 months starting in April 1993. Lagaris brought the payments in cash to Sotiriou's office, and Sotiriou forwarded the money to Middlemiss and Orfanos.
In 1994, Lagaris refused to make additional monthly payments and asked Middlemiss and Orfanos to buy out his share of JFK Diner, Inc. In response, defendants first insisted that they had a buyer for the business. The government contends that defendants created false documents to give the impression of a third-party buyer for the cafeteria. Defendants then demanded that Lagaris pay them a lump-sum final payment in exchange for their corporate interest. A friend of Lagaris, Elias Bonaros, assisted Lagaris in the final negotiations. Lagaris ultimately paid Orfanos and Middlemiss $45,000 in cash in September 1994. The final payment took place in Sotiriou's office in the presence of Orfanos, Bonaros, Middlemiss and Sotiriou. Lagaris operated the cafeteria until July 1996. At about the same time, government officials began investigating the business. During a July 1996 government interview with Sotiriou at his office, Sotiriou claimed to be Lagaris' only partner in the cafeteria and denied knowledge of several corporate documents later found in his office files.
A federal grand jury indicted defendants in September 1997. A second superseding indictment charged defendants in 22 counts with conspiracy, extortion, mail fraud, and various tax crimes. The indictment also charged Orfanos with making a false statement on a questionnaire related to his government employment. The district court in May 1998 severed eight of the tax charges against Middlemiss as unrelated to the Lagaris extortion scheme. The district court also severed two tax charges against Orfanos and transferred them to the Eastern District of New York. A jury trial on counts one through twelve of the indictment took place for two weeks in June 1998. The jury convicted all three defendants on all counts, with the exception of an acquittal for Orfanos on the false statement charge. Judge Stein sentenced Middlemiss on January 29, 1999, to 33 months imprisonment, two years supervised release, $450 special assessment, and $73,000 restitution. Judge Stein sentenced Orfanos on January 29, 1999, to 33 months imprisonment, two years supervised release, $350 special assessment, and $73,000 restitution. Both men currently are serving their sentences. Judge Stein sentenced Sotiriou on February 17, 1999, to 27 months imprisonment, two years supervised release, $10,000 fine, $250 special assessment, and $73,000 restitution. Sotiriou received a stay of his sentence pending appeal. All three defendants appeal their convictions and sentences.
Defendants Middlemiss and Sotiriou principally contend that the government presented insufficient evidence on which to convict them for (1) extortion through wrongful use of fear of economic loss; (2) extortion under color of official right; and (3) use of mail fraud to deprive the Port Authority of Middlemiss' honest services.1 Defendants also claim that the government presented insufficient evidence that venue in the Southern District of New York was proper.
Defendants challenging their convictions on sufficiency grounds bear a "heavy burden." United States v. Matthews, 20 F.3d 538, 548 (2d Cir. 1994). The reviewing court must affirm defendants' convictions if, "viewing all the evidence in the light most favorable to the prosecution, [it] finds that 'any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt.'" United States v. Desimone, 119 F.3d 217, 223 (2d Cir. 1997) (quoting Jackson v. Virginia, 443 U.S. 307, 319 (1979)) (citation omitted) (emphasis in Jackson). The reviewing court must view as a whole all of the trial evidence and defer to the jury's assessment of witness credibility and the jury's resolution of conflicting testimony. See id. "[T]he government's proof need not exclude 'every possible hypothesis of innocence.'" Id. (citation omitted).
The government charged two theories of extortion pursuant to 18 U.S.C. § 1951(a) and (b)(2). The first theory was that defendants extorted money from Lagaris "under color of official right" when they set up the diner corporation because Lagaris gave Middlemiss and Orfanos shares in JFK Diner, Inc. in exchange for their assistance as airport officials to obtain the restaurant lease. The second theory was that defendants extorted money from Lagaris through wrongful use of fear of economic loss when they demanded the $2,000 monthly payments and $45,000 final payment. The government claims, based on Lagaris' testimony, that Lagaris paid defendants because he reasonably believed that they had power to influence airport and other officials who could terminate his cafeteria lease or begin administrative investigations into the health and tax code compliance of his businesses, which would threaten Lagaris' economic investments.
In order to prove extortion under color of official right, "the [g]overnment need only show that a public official has obtained a payment to which he was not entitled, knowing that the payment was made in return for official acts," and "proof of an...
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