U.S. v. Bagnariol

• Citation: 665 F.2d 877
• Decision Date: 21 December 1981
• Docket Number: Nos. 80-1820,s. 80-1820
• Parties: 9 Fed. R. Evid. Serv. 1072 UNITED STATES of America, Plaintiff-Appellee, v. John BAGNARIOL, Defendant-Appellant. UNITED STATES of America, Plaintiff-Appellee, v. Gordon L. WALGREN, Defendant-Appellant. UNITED STATES of America, Plaintiff-Appellee, v. Patrick GALLAGHER, Defendant-Appellant. to 80-1822.
• Court: United States Courts of Appeals. United States Court of Appeals (9th Circuit)

Page 877

665 F.2d 877

9 Fed. R. Evid. Serv. 1072

UNITED STATES of America, Plaintiff-Appellee, v. John BAGNARIOL, Defendant-Appellant.

UNITED STATES of America, Plaintiff-Appellee, v. Gordon L. WALGREN, Defendant-Appellant.

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

Nos. 80-1820 to 80-1822.

United States Court of Appeals Ninth Circuit.

Argued and Submitted Oct. 7, 1981.

Decided Dec. 21, 1981.

Deborah J. Youngblood, Seattle, Wash., for Bagnariol.

Murray B. Guterson, Malcolm L. Edwards, Edwards & Barbieri, Seattle, Wash., for Walgren.

Thomas Hillier, Seattle, Wash., for Gallagher.

John C. Merkel, U.S. Atty., Seattle, Wash., for plaintiff-appellee.

Appeal from the United States District Court for the Western District of Washington.

Before BROWNING, Chief Judge, WRIGHT, Circuit Judge, and THOMPSON, ^* District Judge.

PER CURIAM:

Appellants appeal convictions on various counts of a twenty-nine count indictment resulting from a two-year investigation by the Federal Bureau of Investigation into gambling and alleged political corruption in the state of Washington. Appellant John Bagnariol was convicted on nine counts, appellant Gordon Walgren on three counts, and appellant Patrick Gallagher on fourteen counts.

Appellants challenge their convictions on numerous grounds. We conclude appellants' arguments are without merit and affirm the convictions for reasons which follow.

The government's evidence consisted principally of tapes of surreptitiously recorded conversations between government agents and appellants and testimony of government agents regarding such conversations. Factual recitals in this opinion are based upon the interpretation of this evidence that is most favorable to the government. Glasser v. United States, 315 U.S. 60, 80, 62 S.Ct. 457, 469, 86 L.Ed. 680 (1942).

I. DUE PROCESS

At the request of local authorities, the FBI joined an investigation of local gambling and political corruption in Vancouver, Washington. FBI Agent Harold Heald, posing as the representative of a fictitious California corporation named "So-Cal," led the undercover operation. State undercover agents introduced Heald to Don Buss, the owner of several cardrooms authorized under Washington law to conduct card games financed by the players. Heald represented to Buss that So-Cal was interested in purchasing cardrooms and also in participating in "house-backed" gambling if it were legalized in Washington. Heald expressed a desire to meet local political leaders to assure that legalized gambling would be expanded in Washington and that So-Cal's entry into it would not be opposed.

Buss introduced Heald to appellant Gallagher, a lobbyist and the secretary of the Cardroom Owners Association. Heald repeated So-Cal's interest in buying into and expanding legalized gambling and inquired into the current political climate for gambling legislation. Gallagher responded that legislation to expand gambling would be passed gradually, noting that appellant Bagnariol, Speaker of the Washington House of Representatives, was in favor of gambling legislation. Gallagher offered to introduce Heald to several "powerful political figures" who intended to expand and control legalized gambling in Washington and who could make Heald "certain assurances." Gallagher explained that direct bribes and payoffs were no longer used and that "some of the biggest hoods in the state are now running the state" because "they, in effect, could do better by being politically at the top and running things legally." Gallagher suggested Heald hire him to serve as So-Cal's public relations man and as liaison with state politicians.

Heald initiated the next several meetings with Gallagher. Gallagher assured Heald that he could advance So-Cal's interests through "modern corporate ways" rather than "old fashioned thug ways," stating, "You don't buy people anymore, you rent 'em." Heald responded that So-Cal was prepared to pay whatever was necessary. Gallagher said legalized gambling was coming to Washington and it was his job to make sure his friends controlled it. Gallagher identified Bagnariol as one of these friends. When asked how much money would be required, Gallagher said his friends would determine the amount, and would also guarantee the desired results.

Gallagher and Heald met periodically over the next five months. They negotiated an agreement under which appellants would assure passage of legislation legalizing gambling, appellants and So-Cal would control the legalized gambling, and each appellant would receive six percent of So-Cal's gambling profits. Gallagher then introduced Heald to Bagnariol and Walgren. Both expressed familiarity with the negotiations between Gallagher and Heald and assented to the terms upon which they had agreed.

Appellants Gallagher and Walgren argue that, notwithstanding proof they were predisposed to commit the crimes, the government's initiation of and involvement in the operation constituted "outrageous conduct" that violated their fifth amendment due process rights.

In Greene v. United States, 454 F.2d 783 (9th Cir. 1971), the court recognized a due process defense based on excessive police involvement in the crime for which defendants were convicted. We reversed conspiracy and bootlegging convictions against defendants predisposed to commit these offenses because of the government's direct and continuous involvement over a long period of time in the creation and maintenance of the illegal distilling operation. The government's conduct amounted to "creative activity, substantially more intense and aggressive than the level of such activity charged against the Government in numerous entrapment cases we have examined." Id. at 787 (citation omitted).

In United States v. Russell, 411 U.S. 423, 93 S.Ct. 1637, 36 L.Ed.2d 366 (1973), the Supreme Court reversed a decision of this court applying Greene to reverse convictions for manufacturing and selling a controlled substance. The defendant had been operating a "speed" manufacturing laboratory when a government agent joined the operation and provided an ingredient essential to the manufacturing process. The Supreme Court held the entrapment defense unavailable because the defendant conceded predisposition to commit the offense. The Court also held that on the facts there was no defense based upon a violation of due process by the government. However, the Court's language did not clearly reject the possibility that such a defense might exist:

While we may some day be presented with a situation in which the conduct of law enforcement agents is so outrageous that due process principles would absolutely bar the government from invoking judicial processes to obtain a conviction, cf. Rochin v. California, 342 U.S. 165, (72 S.Ct. 205, 96 L.Ed. 183) (1952), the instant case is distinctly not of that breed. (The agent's) contribution of propanone to the criminal enterprise already in progress was scarcely objectionable.... The law enforcement conduct here stops far short of violating that "fundamental fairness, shocking to the universal sense of justice," mandated by the Due Process Clause of the Fifth Amendment.

Id. at 431-32, 93 S.Ct. at 1642-1643.

The possibility of a due process defense based on the extent of government involvement in the commission of the offense also survived the Court's review in Hampton v. United States, 425 U.S. 484, 96 S.Ct. 1646, 48 L.Ed.2d 113 (1976). In Hampton, the Court affirmed a trial court's refusal to instruct the jury that the defendant could not be convicted if the jury found the government had supplied the defendant the illegal narcotic, which the defendant then sold to government agents. The plurality opinion, written by the author of Russell and representing the views of three Justices, would have foreclosed a due process defense based on government involvement if the defendant was predisposed to commit the crime. Id. at 490, 96 S.Ct. at 1650. The two concurring Justices found it unnecessary to decide whether predisposition precludes a due process defense as well as the entrapment defense, leaving that question open. Id. at 492-95, 96 S.Ct. at 1651-1652 (Powell, J., concurring). Three dissenting justices also declined to decide the constitutional issue. Id. at 497, 96 S.Ct. at 1653 (Brennan, J., dissenting). As this court has said, "Hampton left open the possibility that the conviction of a predisposed defendant may be reversed where the government's involvement in the criminal scheme reaches such an outrageous level as to violate due process." United States v. Gonzales-Benitez, 537 F.2d 1051, 1055 (9th Cir.), cert. denied, 429 U.S. 923, 97 S.Ct. 323, 50 L.Ed.2d 291 (1976). See United States v. Prairie, 572 F.2d 1316, 1319 & n.3 (9th Cir. 1978).

Although excess government involvement in a criminal enterprise may give rise to a due process defense, the courts rarely have found the defense available. The Supreme Court has never reversed a conviction on this ground. We have not done so since Greene. "This court has emphasized that the due process channel which Russell kept open is a most narrow one, to be invoked only when the government's conduct is so grossly shocking and so outrageous as to violate the universal sense of justice." United States v. Ryan, 548 F.2d 782, 789 (9th Cir. 1976), cert. denied, 430 U.S. 965, 97 S.Ct. 1644, 52 L.Ed.2d 356 (1977). See United States v. Smith, 538 F.2d 1359, 1361 (9th Cir. 1976).

The government set Heald up as "bait" by spreading word generally that So-Cal was interested in promoting gambling legislation and in meeting politicians who shared that interest. This tactic led Heald to Gallagher, who volunteered the services of Bagnariol and Walgren. Gallagher stated that appellants planned to expand gambling gradually while maintaining control over its operation and were looking for the proper vehicle in which to vest that control.

The government, through...