916 F.2d 1273 (7th Cir. 1990), 87-2607, United States v. Balzano

Docket Nº:87-2607.
Citation:916 F.2d 1273
Party Name:UNITED STATES of America, Plaintiff-Appellee, v. Daniel L. BALZANO, Defendant-Appellant.
Case Date:October 30, 1990
Court:United States Courts of Appeals, Court of Appeals for the Seventh Circuit

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916 F.2d 1273 (7th Cir. 1990)

UNITED STATES of America, Plaintiff-Appellee,


Daniel L. BALZANO, Defendant-Appellant.

No. 87-2607.

United States Court of Appeals, Seventh Circuit

October 30, 1990

Argued Nov. 30, 1989.

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Anton R. Valukas, U.S. Atty., Steven Shobat, Asst. U.S. Atty., Office of U.S. Atty., Chicago, Ill., for plaintiff-appellee.

James W. Reilley, Reilley & Associates, Des Plaines, Ill., Dianne Ruthman, Chicago, Ill., for defendant-appellant.

Daniel L. Balzano, Park Ridge, Ill., pro se.

Before POSNER, COFFEY and EASTERBROOK, Circuit Judges.

COFFEY, Circuit Judge.

Daniel Balzano was charged in a grand jury's six-count superseding indictment with four counts of extortion in violation of 18 U.S.C. Sec. 1951, one count of conspiracy to violate the Racketeering Influenced and Corrupt Organizations Act (RICO) in contravention of 18 U.S.C. Sec. 1962(d) and one count of threatening and intimidating a grand jury witness in violation of 18 U.S.C. Sec. 1512. Following a jury trial commencing on June 2, 1987, Balzano was found guilty on three of the four counts of extortion, the RICO conspiracy count and the count of threatening and intimidating a grand jury witness. Balzano was sentenced to six months' imprisonment with work release privileges on the RICO conspiracy count and one of the extortion counts with the sentences to be served concurrently.

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On the remaining two extortion counts and the count of threatening and intimidating a grand jury witness, Balzano received sentences of five years' probation to run concurrently with one another and consecutively with the work release term imposed on the other counts. As a condition of his probation, Balzano was required to perform 300 hours of community service. Balzano appeals his convictions. We affirm.



The City of Chicago's Fire Prevention Bureau is a unit of the Chicago Fire Department, responsible for the enforcement of the Chicago Fire Code including on-site investigation of property and the issuing of citations for violations of the Code. 1

Daniel Balzano, a Chicago Fire Inspector in 1983-84, was charged with receiving payoffs from business enterprises that had applied for liquor, food and amusement licenses. Balzano, while assigned to the North Side Task Force, split payoffs with Richard Dorband, the Fire Prevention Bureau Inspector and supervisor of the North Side Task Force. On three other occasions Balzano got more greedy and rather than splitting the payoffs, shook down business license applicants himself without splitting the payoffs. Balzano would advise the business proprietors of the necessity to make the repairs indicated in order that they might comply with the Code and would then demand a "payoff" from the owners in lieu of or in addition to the repairs.

After a plea agreement Richard Dorband testified for the government with respect to the payoffs he split with Balzano. Dorband stated that during the year he worked with Balzano, he and Balzano received and split a number of small payoffs of approximately $20 on each occasion. He estimated that Balzano received a total of between $100 and $150 from these payoffs. Dorband was able to remember one large payoff from Woo Kim, the proprietor of the China Moon Restaurant. Dorband testified that on June 28, 1983, he received $500 from Kim, kept $100, gave $100 to Balzano, gave another $100 to a health inspector and returned the remaining $200. 2

As noted above, there were also incidents where Balzano, on his own, demanded and/or received "payoffs" to facilitate the approval of the licenses. The first of these occasions involved the liquor license application of the Club Victoria nightclub. Upon completion of the initial inspection the premises were deemed "not ready," 3 and Balzano arranged for a meeting with the Club's proprietors, Roy LaBolle and Jennifer Hammersmith. During the meeting, Balzano took Hammersmith on an inspection tour of the premises pointing out examples of non-compliance with the fire code. Hammersmith, while viewing one of the alleged defects, inquired of Balzano why she was now required to comply with the Code and the former owners were allowed to operate without conforming. Balzano told Hammersmith that "he could make me wallboard any part of the building that he wanted me to." Further, Balzano told Hammersmith that she would be required to have the work on her business

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performed by a craftsman Balzano recommended. When Hammersmith challenged Balzano on this point, Hammersmith testified that Balzano again told her that "he could make [her] do anything that he wanted to," and that if she failed to comply with his directions, her license application would not be approved. Further, Balzano advised her that she would be required to make a $2,500 cash payment to him in order to guarantee that Club Victoria would pass the next task force inspection. Complying with Balzano's demands, Hammersmith stated that she hired Guy Nowak to perform the work, on Balzano's recommendation, and made the $2,500 cash payoff to Balzano prior to the Club's reinspection. On January 20, 1983, Club Victoria passed the reinspection with Daniel Balzano appearing on the premises with the inspection team.

The next payoff incident was an application for a liquor license with a 2 a.m. closing time limit of the United Skates of America roller skating rink filed late in 1982. Tom Grisamore, general manager of the roller skating group, and Jim Dvorak, vice president of United Skates and Grisamore's superior, suggested that James Allenson, co-owner of their arcade machine supplier, be given $2,200 to pay off public officials to obtain the license. Allenson spoke with Terry Mofreh, an inspector from the City's Consumer Services Department, and explained that United Skates wanted a liquor license to help promote entertainment in their roller rink and asked Mofreh for his help in obtaining the liquor license. Mofreh told Allenson that he would get back to him and eventually told him that he could provide assistance at this time. Mofreh advised him that $1,500 would be required, and Allenson paid Mofreh the $1,500 in cash.

The North Side Task Force performed a liquor license inspection of the United Skates premises on February 17, 1983, with Terry Mofreh who, although not assigned to the inspection team, also appeared. During the inspection, Mofreh approached Richard Dorband and told him that he was interested in seeing that United Skates passed the inspection. Dorband talked to Balzano and after their conference it was suggested to Mofreh that a contribution of $300 to the fireman's fund would help to gain approval. Allenson gave Mofreh an additional $300, and he turned the money over to Dorband. 4 After the inspection was completed, Mofreh told Allenson that everything was fine.

About a week after the task force's inspection of the United Skates premises, a fire inspector visited Tom Grisamore and identified himself as a member of the inspection team. Grisamore testified that he recognized the inspector as having visited the premises on an earlier occasion while a member of the inspection group. Grisamore described the inspector at trial as a "white male, dark hair, in his mid-twenties to thirties, youngish, five-nine to six feet [who] possibly had a mustache," a description matching Balzano. Grisamore also testified that the inspector was wearing a uniform. The inspector stated that the building premises license application had a problem since the establishment was without a sprinkling system. Grisamore complained the installation would cost about $100,000. In response, the fire inspector displayed an advertisement containing a picture of a video cassette recorder and a television and, in Grisamore's words, "indicated that if I could get this for the boys at the station house ... there wouldn't be any problem with the sprinkling system." Pursuant to Grisamore's request, the inspector wrote his name and telephone number on a piece of paper that was left with Grisamore. Although at the time of trial Grisamore was unable to positively I.D. Balzano, Allenson testified that he received a telephone call from Grisamore (after the extortion attempt) in which Grisamore referred to Dan Balzano as the fire inspector who had visited him at the time of the alleged

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shakedown. When Allenson later met with Grisamore at United Skates, Grisamore gave Allenson a picture of the VCR and television from a newspaper he had received from the fire inspector along with a piece of paper with Balzano's name inscribed thereon. Allenson met with Terry Mofreh shortly thereafter who, at Allenson's request, confronted Balzano with the information concerning the attempted "shakedown." During this confrontation, Balzano did not deny the extortion attempt but told Mofreh that United Skates had promised him a video recorder.

Balzano's next payoff episode involved the liquor and food license applications of Eddie's Barbecue Ribs restaurant, owned by Cesar Aguilera. Two task force inspections were performed, and at the time of the second inspection Aguilera spoke with an individual wearing a fire inspector's uniform whose description matched that of Balzano: "a young person, about five-seven, about 150 pounds, white, kind of brown hair and a mustache." 5 Despite the fact that Aguilera had complied with the majority of the violations noted in the earlier inspection, the fire inspector told Aguilera that the ceiling still required fireproofing and the decorative wood needed to be fire retardant. When Aguilera asked the fire inspector for an estimate of the cost of the alterations, the inspector gave him a figure of some $50,000...

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