U.S. v. Frumento

Decision Date30 September 1977
Docket NumberNo. 77-1090,No. 77-1127,J,77-1127,Nos. 77-1090,77-1090,s. 77-1090
Citation563 F.2d 1083
PartiesUNITED STATES of America v. Rocco FRUMENTO, Andrew J. Millhouse, George W. Collitt, John R. Sills, Vito N. Pisciotta, a/k/a Vic, Andrew Millhouse, Appellant inohn R. Sills, Appellant in
CourtU.S. Court of Appeals — Third Circuit
OPINION OF THE COURT

Before ALDISERT, ROSENN and HUNTER, Circuit Judges.

ROSENN, Circuit Judge.

Appellants Andrew Millhouse and John R. Sills were indicted in the United States District Court for the Eastern District of Pennsylvania for violations of 18 U.S.C. § 1962(c) and (d) (racketeering activity and conspiracy) 1 and 26 U.S.C. § 7206(1) (fraud and false statements in making and subscribing to federal income tax returns for the calendar year 1971 and 1972). 2 They were tried before a jury together with co-defendant Rocco Frumento and after a trial lasting almost two weeks were found guilty on all counts. 3

I.

This case presents several important issues of first impression in this circuit growing out of a conspiracy to smuggle cigarettes into Pennsylvania for resale without payment of the Pennsylvania cigarette tax. During the period of the conspiracy, June 1971 through mid-March 1972, appellant Sills was in charge of patronage for Peter Camiel, chairman of the Philadelphia Democratic City Committee. Millhouse was the supervisor of the District II office of the Pennsylvania Department of Revenue's Bureau of Cigarette and Beverage Taxes ("BCBT" or the "Bureau"). The district II geographic area comprised Philadelphia and its four surrounding counties. As the district supervisor, Millhouse had direct administrative control over all the investigators within his district.

The events here at issue began in 1971 with an effort by Sills to secure Frumento's appointment to a position with the Bureau. While Frumento's appointment was pending, Vito Pisciotta, a Philadelphia lawyer, introduced Frumento to his client, Harold J. Sharp, a Philadelphia cigarette wholesaler with prior convictions for felonies. In a series of meetings with Sills and Pisciotta, Frumento revealed a plan to import large quantities of untaxed cigarettes into the state of Pennsylvania, to affix counterfeit Pennsylvania tax stamps to them, and to provide "protection" to his accomplices through his position with the Bureau. Frumento informed Sharp that he expected the latter to act as the outlet for the untaxed cigarettes. It was agreed that Sharp would provide the necessary capital to purchase the untaxed cigarettes and Frumento and the others would obtain and transport the cigarettes into Pennsylvania, affix the counterfeit stamps, and deliver them to Sharp's warehouse.

In August 1971, Frumento commenced the transportation of cigarettes from North Carolina to Sharp's warehouse in Philadelphia from whence they were distributed and sold. Sills, Frumento, and Pisciotta were each to receive $1,000 weekly from the operation. About the time that the conspiracy began, Frumento was appointed a field inspector with BCBT. Within several weeks after the commencement of the conspiracy, Sills had effectively gained the ability to hire and fire personnel at the District II office of BCBT. Millhouse was offered, and accepted, the opportunity to participate in the smuggling operation at $500 per week. Roy Wade, a field inspector in BCBT under Millhouse's jurisdiction, was later offered a similar opportunity to participate in the conspiracy at a figure of $200 weekly which he accepted.

The cigarette smuggling operation continued for about thirty weeks and terminated with the arrest of Harold Sharp on March 13, 1972. In May 1972 the Commonwealth of Pennsylvania arrested Sills following a grand jury investigation and he, Sharp, Millhouse, and Frumento were charged under Pennsylvania criminal laws with bribery, extortion, and conspiracy, respectively. In June 1972, Sills, Frumento, and Millhouse stood trial in the Philadelphia Municipal Court on these charges and were found not guilty by Judge Calvin Wilson, Court of Common Pleas of Philadelphia County sitting as a municipal court judge. 4 On May 22, 1975, the appellants were indicted in the United States District Court in an eleven count indictment on the charges described in the first paragraph of this opinion.

Of the series of issues raised on this appeal we believe only two warrant discussion: (1) Were Millhouse's convictions on count I (substantive offense of racketeering) and on count II (conspiracy) of the indictment and Sills' conviction on count II (conspiracy) of the indictment barred by the double jeopardy clause of the fifth amendment of the United States Constitution because of his prior acquittal in state court? (2) Is the Pennsylvania Bureau of Cigarette and Beverage Taxes an "enterprise" within the meaning of Title IX of the Organized Crime Control Act of 1970?

II.

Both appellants claim that their federal prosecution was barred by the double jeopardy clause of the fifth amendment 5 to the Constitution. In considering a pretrial motion filed by the co-defendant, Frumento, who also asserted the same contention, the district court capsulized the factual basis for the appellants' claim as follows:

In June 1972 (the defendants were) tried and acquitted in Philadelphia Municipal Court on the charges of bribery, extortion and conspiracy to accept bribes and avoid payment of the Pennsylvania cigarette tax. The state indictment was based on the same alleged activity as the present federal indictment, which charges that (the defendants) violated 18 U.S.C. § 1962(c) by engaging in the conduct of the Bureau's affairs through a pattern of racketeering activity.

United States v. Frumento, 409 F.Supp. 136, 139 (E.D.Pa.1976). The same operative facts apply to Millhouse and Sills. 6

On the authority of Abbate v. United States, 359 U.S. 187, 79 S.Ct. 666, 3 L.Ed.2d 729 (1959), 7 the district court rejected the contention that successive state and federal prosecutions are barred by the double jeopardy clause; it also rejected the argument that the doctrine of collateral estoppel barred this prosecution. See Ashe v. Swenson, 397 U.S. 436, 90 S.Ct. 1189, 25 L.Ed.2d 469 (1970).

The Supreme Court and many United States courts of appeals which have had the occasion to consider the question have followed the general principle that a federal prosecution is not precluded by a prior state prosecution of the same person for the same act. In Abbate v. United States, supra, the Court again reviewed the issue. Petitioners in that case had been indicted and convicted in an Illinois state court for violating a state statute making it a crime to injure or destroy the property of another and were thereafter indicted and convicted in the federal court for conspiracy, in violation of a federal statute, 18 U.S.C. § 1362, to destroy certain communications facilities operated or controlled by the United States. The same misconduct was the basis of both convictions. Petitioners asked the court to override United States v. Lanza, 260 U.S. 377, 43 S.Ct. 141, 67 L.Ed. 314 (1922), wherein it had squarely upheld a federal prosecution arising out of the same facts which had been the basis of a state conviction. The Court, however, found no persuasive reason for departing from the firmly established principle to which we have just alluded. On the contrary, it observed that "undesirable consequences would follow if Lanza were overruled." Abbate v. United States, 359 U.S. at 195, 79 S.Ct. at 671.

Millhouse and Sills argue that their prior acquittals in the Philadelphia Municipal Court on the very state law charges which formed the basis of their indictment under 18 U.S.C. § 1961 et seq. bars their trial and conviction on counts I and II. Section 1961, they claim, incorporates the state law charges in making it a crime to commit a pattern of state offenses. Specifically, they assert that count I of the indictment charges the same acts of bribery of which they were acquitted in the state court and that this distinguishes their case from Bartkus v. Illinois, supra, and Abbate v. United States, supra, wherein the successive prosecutions were for violations of different statutes of different sovereigns. In the instant case, although the bribery of a state official is not a federal crime, they argue that 18 U.S.C. § 1961 et seq. makes it a federal crime, inter alia, to commit a "pattern" of state offenses in certain circumstances and, of necessity, gives the federal courts jurisdiction to try the underlying state offenses.

We have examined the cases cited by appellants but we do not find that any of them support their contention. Their principal case, United States v. Mason, 213 U.S. 115, 29 S.Ct. 480, 53 L.Ed. 725 (1909), expressly turned on the construction of a federal statute; it narrowly inquired into the meaning and scope of a citizen's right to vote law. Mason had been acquitted in a state court of the murder of a federal officer. Subsequently, he was charged in a federal court with conspiring to hinder or obstruct federal officers in the exercise of rights secured to them under the laws of the United States and with committing the murder of a federal officer as part of the conspiracy. The conspiracy charge was in violation of section 5508 of the Revised Statutes as to which section 5509 provided that, "if in violating any provision of the two preceding sections any other felony or misdemeanor be committed, the offender shall be punished . . . with such punishment as is attached to such felony or misdemeanor by...

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