USA v. Urciuoli

Decision Date20 July 2010
Docket NumberNo. 09-1504.,09-1504.
Citation613 F.3d 11
PartiesUNITED STATES of America, Appellee, v. Robert A. URCIUOLI, Defendant, Appellant.
CourtU.S. Court of Appeals — First Circuit

OPINION TEXT STARTS HERE

Martin G. Weinberg with whom Kimberly Homan was on brief for appellant.

Donald C. Lockhart, Assistant United States Attorney, with whom Luis M. Matos, Assistant United States Attorney, Dulce Donovan, Assistant United States Attorney, and Peter F. Neronha, United States Attorney, were on brief for appellee.

Before BOUDIN, Circuit Judge, Souter, * Associate Justice, and Howard, Circuit Judge.

BOUDIN, Circuit Judge.

Robert Urciuoli, the former chief executive officer of Roger Williams Medical Center (“RWMC”) in Providence, Rhode Island, seeks review of his conviction following his second trial for multiple counts of honest services mail fraud and conspiracy to commit such fraud. 1 He was convicted of the same offense in an earlier trial, but that conviction was vacated on appeal. United States v. Urciuoli (“ Urciuoli I ”), 513 F.3d 290, 300 (1st Cir.2008). Urciuoli I describes some background facts of this case, as well as the governing statute and case law.

The gravamen of the charge against Urciuoli was his role in a scheme to bribe-in the guise of an employment contract-John Celona, then a Rhode Island state senator. Insofar as Urciuoli challenges the sufficiency of the evidence, the facts are to be taken in the light most favorable to the jury's verdict. United States v. Arroyo, 546 F.3d 54, 55-56 (1st Cir.2008). The pertinent events and proceedings are as follows.

In the summer of 1997, Celona-after discussion with Urciuoli (CEO of RWMC) and Frances Driscoll (Senior Vice President of RWMC)-spoke and voted against overriding the Rhode Island governor's veto of a bill that (if passed) would make it hard for a for-profit entity to acquire a non-profit hospital. Urciuoli and Driscoll opposed the bill (and supported its veto) because it would prevent their desired sale of RWMC to another entity. Celona failed by two votes to sustain the veto, so the bill became law.

Immediately after this effort, Celona asked Urciuoli for employment, explaining that he was going through financial difficulties. In February 1998, Celona signed a contract purportedly employing him to market an RWMC-owned nursing home called Elmhurst Extended Care and an assisted living facility-the Village at Elmhurst (“the Village”)-owned partly by an RWMC subsidiary and partly by a separate entity owned by a man named Peter Sangermano.

Although Celona did some marketing for the Village, his efforts were fairly modest and his compensation substantial. In the case that followed, the government charged that Urciuoli was in substance employing Celona to use his office on behalf of RWMC in two different respects:

• to support or oppose bills in accordance with RWMC's interest, including attempts to “kill” certain bills, and otherwise to promote RWMC's interests with respect to pending legislative matters;
• to conduct meetings at Celona's government office with Urciuoli and representatives of two major insurance companies in order to resolve longstanding disputes about reimbursements owed to RWMC.

Urciuoli, Driscoll, Sangermano and RWMC were indicted in the Rhode Island federal district court, and RWMC entered into a plea bargain but the three individual defendants went to trial. Although Sangermano was acquitted, Urciuoli and Driscoll were convicted on various counts of honest services mail fraud or aiding or abetting such fraud, 18 U.S.C. §§ 2, 1341, 1346, and-in Urciuoli's case-also conspiracy to commit honest services mail fraud, id. § 371.

Urciuoli and Driscoll appealed and we held that certain of the conduct presented to the jury in the first trial-namely, Urciuoli and Driscoll's role in Celona's lobbying of municipal officials to increase the number of patients brought to Roger Williams Hospital by ambulance-was not a crime under the honest services statute. Urciuoli I, 513 F.3d at 295-96. Because the jury instructions permitted conviction for such conduct and the jury might have convicted on that basis, a new trial was ordered. Id. at 297.

In the new trial, the government presented much of the evidence offered in the first trial, but Celona did not testify and this time the government limited its theory to quid pro quo bribery, eschewing any suggestion that-absent bribery-an undisclosed conflict of interest on Celona's part was sufficient, and avoiding reliance on Celona's lobbying relating to the ambulance service. The theory thus fits within the Supreme Court's recent interpretation of the honest services provision in Skilling v. United States, --- U.S. ----, 130 S.Ct. 2896, 177 L.Ed.2d 619, 2010 WL 2518587 (2010), a decision to which we will return in due course.

In the second trial, although Driscoll was acquitted, Urciuoli was convicted on the same counts as in the first trial: thirty-five substantive counts of honest services mail fraud (corresponding to each payment check mailed to Celona) and one conspiracy count. The district court denied Urciuoli's motion for judgment of acquittal and his motion for a new trial, and sentenced him to 36 months' imprisonment.

Urciuoli now appeals from his conviction on three grounds, and we begin with his claim that the evidence was insufficient to prove the crimes charged. Urciuoli says that the government failed to provide sufficient evidence to establish either the essential actus reus-an exchange of salary payments for Celona's legislative action or forbearance-or the required mens rea-Urciuoli's intent that the salary payments serve as a corrupt quid pro quo bribe.

The government's evidence permitted the jury to find that Celona's work for the Village was modest given his ample salary (roughly $260,000 total between February 1998 and January 2004); that his limited work for the Village decreased over the years while his contract was renewed and his weekly fee rose (on Urciuoli's orders) from $700 to $892 to $1000; that he reported more often to Driscoll and Urciuoli than to Village management; and that his salary was covered by RWMC and not the Village.

The jury could also find that Urciuoli hired Celona shortly after Celona had exerted legislative efforts in RWMC's favor; that others at RWMC and the Village thought Celona lacked the skills for the purported marketing work; and that Urciuoli renewed Celona's contract and increased his pay shortly after Celona's effort to, in Urciuoli's words, “crank around”-that is, to exert pressure on-one of the insurance companies with whom RWMC was negotiating about reimbursement. Evidence further showed that Urciuoli sought to hide the extent of RWMC's relationship with Celona. 2

From this and other evidence, a rational jury could find that Urciuoli's purpose was for Celona to use his office on behalf of RWMC and that Celona did so, that the compensation nominally for marketing was in reality for Celona's misuse of his powers, and that the result was a conspiracy to deprive Rhode Island citizens of Celona's honest services as a Rhode Island senator. Because various mailings occurred in implementing the scheme, those mailings triggered the mail fraud statute, which expressly extends to honest services fraud. See note 1, above. The inferred conspiracy between Urciuoli and Celona was also adequately proved.

Urciuoli's counter-arguments are not persuasive. That Celona performed some marketing services did not prevent the jury from regarding the payments as primarily intended by Urciuoli to secure Celona's legislative help. Nor does it matter whether Celona expressly agreed to help RWMC on specific bills, for the jury could infer an understanding that he provide RWMC general support in exchange for money (even if occasionally opposing RWMC). 3 Urciuoli was free to make such arguments to the jury, but the jury could fairly reject them.

At greater length, Urciuoli argues that the jury should have been instructed on the Rhode Island state law “class exception” and that Urciuoli should be granted a new trial for the court's failure to so instruct. The class exception is a Rhode Island statute declaring that a state legislator privately employed does not have a conflict of interest with his legislative duties if the benefit that accrues to his employer from his actions is no more than that obtained by other employers in the same class. R.I. Gen. Laws § 36-14-7(b) (2010).

Urciuoli argues, first, that concerns about federalism, fair notice, and the First Amendment right to petition the government require that state law be considered in determining the content of a state legislator's duties for which the failure to perform constitutes the deprivation of honest services under section 1346. But as we explained in Urciuoli I, [n]othing in Rhode Island law purports to authorize or protect” quid pro quo bribery. 513 F.3d at 299; see also R.I. Gen. Laws §§ 11-7-3 to -4 (criminally prohibiting bribery of a state official). The class exception does not protect the conduct charged by the government.

The theory that non-disclosure of a conflict of interest was enough, even without a bribe, was advanced by the government in the first trial; but, stripping down its case, the government excluded any such theory from its opening argument, the revised indictment and its closing argument. And this time the jury instructions made it clear beyond peradventure that

the Government must prove beyond a reasonable doubt that Defendant Urciuoli intended the payment to cause John Celona to alter his official acts, to change an official position that he would otherwise have taken or to take official actions that he would not have taken but for the payment

and that

[t]he Government has charged honest services mail fraud based on a claim that John Celona was paid to perform certain official acts. Paying a legislator to perform political acts is not the same as employing a
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