United States v. McDonough

• Citation: 727 F.3d 143
• Decision Date: 21 August 2013
• Docket Number: Nos. 11–2130,11–2163.,s. 11–2130
• Parties: UNITED STATES of America, Appellee, v. Richard W. McDONOUGH and Salvatore F. Dimasi, Defendants, Appellants.
• Court: U.S. Court of Appeals — First Circuit

727 F.3d 143

UNITED STATES of America, Appellee,

v.Richard W. McDONOUGH and Salvatore F. Dimasi, Defendants, Appellants.

Nos. 11–2130, 11–2163.

United States Court of Appeals,First Circuit.

Aug. 21, 2013.

Martin G. Weinberg, with whom Kimberly Homan was on brief, for appellant Richard W. McDonough.

Thomas R. Kiley, with whom William J. Cintolo and Cosgrove, Eisenberg & Kiley, P.C. were on brief, for appellant Salvatore F. DiMasi.

John–Alex Romano, Attorney, Appellate Section Criminal Division, United States Department of Justice, with whom Carmen M. Ortiz, United States Attorney, S. Theodore Merritt, Kristina E. Barclay, Assistant United States Attorneys, Lanny A. Breuer, Assistant Attorney General and John D. Buretta, Deputy Assistant Attorney General, were on brief, for appellee.

Before HOWARD, Circuit Judge, SOUTER,^* Associate Justice, and LIPEZ, Circuit Judge.

HOWARD, Circuit Judge.

After a six-week trial, a jury in the District of Massachusetts convicted Salvatore F. DiMasi, the former Speaker of the Massachusetts House of Representatives, and Richard W. McDonough, a lobbyist, of numerous crimes resulting from a scheme to funnel money to DiMasi in exchange for political favors. A third alleged participant, DiMasi's friend and financial advisor Richard Vitale, was acquitted. A fourth, Joseph Lally, pled guilty and cooperated with the government. The basic contours of the scheme saw Lally, as an employee of one company and later as a principal in another, make payments to DiMasi, who in return took official actions in his role as House Speaker to benefit Lally's business concerns. The money was funneled to DiMasi through McDonough, Vitale and Steven Topazio, an attorney who shared a law practice with DiMasi and who was not criminally charged.

The district court denied DiMasi's and McDonough's post-trial motions and subsequently sentenced them to ninety-six and eighty-four months' imprisonment, respectively. On appeal, each of them advances a panoply of arguments that fall into four general categories: 1) sufficiency of the evidence; 2) jury instructions; 3) evidentiary issues; and 4) sentencing. After considering the extensive arguments of able counsel, we affirm the convictions and sentences.

I. FACTUAL BACKGROUND

To the extent that the appellants assert claims of insufficient evidence, we describe the facts in the light most favorable to the jury's verdict. United States v. Urciuoli, 613 F.3d 11, 13 (1st Cir.2010) (“Urciuoli II ”). We first outline the salient facts underlying the convictions, adding more details later as necessary.

A state representative since 1979, DiMasi was elected Speaker of the Massachusetts House of Representatives in September 2004. He was also a practicing attorney, but as his legislative and political responsibilities increased, his income from his law practice declined and his personal debt grew. Both McDonough and Vitale were long-standing friends of DiMasi.

Until February 2006, Lally was a Vice President of Cognos Corporation, an international software company. Lally was the head of Cognos's lobbying arm, the aim of which was to boost the sale of Cognos software to state and local governments. After leaving Cognos in 2006, Lally formed Montvale Solutions, a reseller of Cognos software, for which Montvale was paid a twenty percent commission. Lally and DiMasi were not strangers, as DiMasi had previously represented Lally in a criminal matter and also attended his wedding. Cognos was one of McDonough's lobbying clients. He assisted Lally in gaining access to the government officials who would make decisions about software purchases and funding.

In December 2004, McDonough told Lally that he was looking for a way to supplement DiMasi's income. He suggested that Lally have Cognos hire DiMasi's law partner Topazio and pay him a monthly retainer, a portion of which would be transferred to DiMasi under the auspices of the lawyers' existing fee-sharing arrangement. DiMasi subsequently told Topazio that McDonough would soon be referring a new client to him. Later in December, McDonough and Lally met with Topazio, whereupon they agreed that Cognos would retain Topazio for six months at a rate of $5000 per month. Although Topazio's legal practice was focused on real estate matters and criminal and personal injury cases, McDonough explained that Cognos would be hiring him for contract work related to Cognos software. Lally testified that he agreed to the “sham” contract in order to “funnel money” to DiMasi and that he was trying to “gain favor with the Speaker, to have him help us close software, cut deals, and obtain funding for us.”

After the deal was struck, McDonough told Lally that it was important for Lally and Cognos to “find something for [ ] Topazio to do to sort of cover [their] ass if something ever[ ] blew up.” As Lally had authority only to hire lobbyists, he told McDonough that he would hire Topazio for that function, rather than lawyering, in order to ensure that the hire would be approved by Cognos. Topazio received a six-month contract from Cognos in March 2005, but was surprised to see that it was a lobbying contract, not one for legal services as had been discussed at their earlier meeting. When Topazio made further inquiries, Lally presented it to him as a “take it or leave it” proposition. Topazio also called DiMasi, who instructed him to sign the contract, rather than “screw up” the arrangement by attempting to negotiate terms with Lally. Topazio complied.

As provided by the contract, Topazio received the first $5000 payment from Cognos in early April 2005. Complying with DiMasi's demand, Topazio paid $4000 to DiMasi as a referral fee, a figure that was higher than their typical fee-sharing arrangement, although Topazio subsequently reverted to splitting the payment evenly with DiMasi. The contract was renewed three times, with Topazio receiving $125,000 from Cognos and transferring $65,000 to DiMasi. At one point in time, Cognos failed to make several of the $5000 payments to Topazio and “caught up” with one payment of $25,000, which DiMasi demanded from Topazio in its entirety. DiMasi returned Topazio's $25,000 check, however, and requested that he send four smaller checks, which Topazio did. At no point during the time that Topazio was under contract did Cognos, Lally, or McDonough ask him to perform any work.

In 2005, at roughly the same time as the Lally–McDonough–Topazio deal was being finalized, the Massachusetts Department of Education (“DOE”) requested proposals for a pilot program known as Education Data Warehouse (“EDW”), that would employ software to aggregate DOE data from multiple databases into a single format. The DOE's plan was to spread the EDW project statewide, eventually. Cognos wanted to procure both the pilot and statewide contracts, from which Lally would receive commissions on payments to Cognos.

Cognos submitted a $5 million bid, with $500,000 for the software relating to the pilot program and the remaining $4.5 million targeted at the statewide project if the pilot program proved successful. Cognos was awarded the pilot project in August 2005, but the statewide project would require legislative funding. Lally then impressed upon McDonough the importance of “get[ting] to the Speaker [to] get funding for this project that DOE wanted.” Lally also “reminded” McDonough of the relationship with Topazio, telling him that “it was time for it to pay off.” McDonough responded with a promise to contact DiMasi.

Prior to the award of the pilot contract, DiMasi and McDonough discussed with Lally the prospect of DiMasi speaking with DOE Commissioner David Driscoll on Cognos's behalf. Among the issues that Lally wanted DiMasi to raise with Driscoll was the claim that a Cognos competitor had provided a poor software product for the state trial court system. In October 2005, after the pilot project award, Driscoll spoke with DiMasi about legislation to fund the statewide project. DiMasi cautioned Driscoll not to choose “the company that screwed up the courts.” When Driscoll told DiMasi that he thought that Cognos would be selected, DiMasi expressed that he “was fine with that” and said, “if we can help, let us know.” DiMasi also contacted House Majority Whip Linda Hawkins regarding the EDW project, instructing her to inform Driscoll that DiMasi would ensure that any data collection enterprise that DOE proposed would be included in the state budget.

In fact, Massachusetts Governor Romney did not include the funding in his proposed 2007 budget. Lally conferred with McDonough about speaking with DiMasi; McDonough told him that he would “take care of it.” DiMasi subsequently had his legal counsel draft a budget amendment providing $5.2 million for the overall EDW project, $4.5 million of which was specifically earmarked for software. The draft amendment was shared with McDonough and Lally.

By this time, Lally had already left Cognos for Montvale. Before doing so, however, he negotiated a deal with Cognos that provided him a 20% commission on software deals that he had arranged, but had not yet closed. EDW was one such deal. Lally also advised his successor at Cognos, Christopher Quinter, never to cancel a contract “for a lobbyist named Topazio.” He said that Topazio was a “friend to Sal” and would be helping Lally. Fearing that an inquisitive Quinter would uncover the details of the scheme involving McDonough,Topazio and DiMasi, Lally also told Quinter not to tell McDonough about the Topazio deal, even though, obviously, McDonough was privy to it. Lally explained that he wanted Quinter “to stay as far away from [the deal] as possible.”

As the legislative process moved forward, State Representative Robert Coughlin sponsored the EDW amendment—with the software earmark—because he was “honored” to make a proposal that was of such importance to the Speaker. DiMasi's staff also informed the House Ways and Means Committee of the Speaker's support...