U.S. v. Canestraro

• Decision Date: 01 March 2002
• Docket Number: No. 01-3439.,01-3439.
• Citation: 282 F.3d 427
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Richard W. CANESTRARO, Defendant-Appellant.
• Court: U.S. Court of Appeals — Sixth Circuit

282 F.3d 427

UNITED STATES of America, Plaintiff-Appellee, v. Richard W. CANESTRARO, Defendant-Appellant.

No. 01-3439.

United States Court of Appeals, Sixth Circuit.

Submitted December 4, 2001.

Decided and Filed March 1, 2002.

Frank M. Pignatelli (briefed), Emershaw, Mushkat & Schneier, Akron, Ohio, for Appellant.

Kathleen M. Brinkman (briefed), Assistant United States Attorney, Cincinnati, Ohio, for Appellee.

Before: KENNEDY, MOORE, and COLE, Circuit Judges.

OPINION

KAREN NELSON MOORE, Circuit Judge.

The defendant, Richard W. Canestraro, pleaded guilty to one count of aiding and abetting the acceptance of an unlawful gratuity by a public official. He appeals the district court's determination of his offense level for the purposes of sentencing. In particular, Canestraro argues that the district court erred in finding that his offense involved more than one gratuity and in calculating the amount of the gratuities attributable to him. For the reasons stated below, we AFFIRM the sentence imposed by the district court.

I. BACKGROUND

The undisputed facts of this case are set forth in an attachment to the defendant's plea agreement. The defendant, Richard W. Canestraro, was the Executive Director of the North Ohio Valley Air Authority (NOVAA) from July 1995 until NOVAA ceased to exist on September 30, 1997. Prior to accepting the position as Executive Director, Canestraro was a member of the NOVAA board of directors. NOVAA was a multi-county air quality regulatory agency headquartered in Steubenville, Ohio. NOVAA received funds from the United States Environmental Protection Agency, through the Ohio Environmental Protection Agency ("Ohio EPA"), for the purpose of enforcing federal and state air quality laws within its six counties, including Jefferson County, where the Pine Hollow C&D Landfill ("Pine Hollow") is located. Canestraro's predecessor as Executive Director of NOVAA was Patsy J. DeLuca. As Executive Director and former Executive Director of NOVAA, DeLuca was a public official and former public official for the purposes of the federal anti-gratuity statute. See 18 U.S.C. § 210(a)(1) & (c)(1)(B).

In November 1993, DeLuca and Vincent Zumpano, a NOVAA employee, attempted to negotiate a contract with the owner of Pine Hollow, whereby the owner would pay them to assist in obtaining permits for Pine Hollow or to assist in the sale of Pine Hollow. At that time and thereafter, NOVAA and Ohio EPA were responsible for enforcing air quality laws with regard to Pine Hollow, including the issuance of such permits. The owner did not sign the proposed contract. Nevertheless, in November 1993, Ohio EPA granted Pine Hollow a temporary permit to accept debris from two sites being demolished by RSV, Inc., a demolition-construction company owned by Robert S. Vukelic. The owner of Pine Hollow died in December 1993. After his death, DeLuca and Zumpano unsuccessfully attempted to get representatives of the owner's estate to pay the Foggia Company, an organization formed by DeLuca and Zumpano, to assist in the sale of Pine Hollow.

Canestraro became aware of the activities of DeLuca and Zumpano regarding Pine Hollow when he became involved in efforts to sell the landfill and obtain Ohio EPA permits. Sometime after he learned of DeLuca and Zumpano's involvement with Pine Hollow, Canestraro agreed to assist the Foggia Company's efforts. In particular, Canestraro prepared projections concerning the operations and financing of the landfill. The projections were prepared to facilitate the sale of the Pine Hollow landfill to Vukelic, and to assist Foggia in obtaining a contract with Vukelic, whereby Vukelic would pay Foggia for assistance in getting permits for the landfill. Canestraro agreed to accept a fee of $3500 from Foggia for his work in preparing the projections.

In early 1994, Vukelic purchased Pine Hollow. On April 20, 1994, DeLuca, Zumpano, and Canestraro, then operating as Foggia II, entered into a written agreement with RSV, which obligated RSV to pay $330,000 to Foggia II for advice regarding RSV's pending permit applications before Ohio EPA for new or expanded sites at Pine Hollow. The agreement also provided that RSV would pay a "success fee" of $60,000 upon Pine Hollow's receipt of an Ohio EPA permit to operate. The agreement was signed by Vukelic as RSV President and DeLuca as Chairman of Foggia II.

On April 20, 1994, DeLuca, Zumpano, and Canestraro entered into a written agreement in which they agreed to divide equally any compensation paid to Foggia II. On April 21, 1994, DeLuca, Zumpano, and Canestraro entered into a separate written agreement in which they agreed to divide equally the $330,000 that Foggia II was to receive under its contract with RSV. The three members of Foggia II also reached an oral agreement to pay 50% of the payments from RSV to a subconsultant, who would assist in obtaining the operating permit for Pine Hollow.

Between April 1994 and October 1996, Vukelic made twenty separate payments to Foggia II, totaling $169,750. On February 3, 1995, Ohio EPA granted Pine Hollow a permit to accept waste from any demolition site. Pursuant to RSV's Agreement with Foggia II, Vukelic paid the $60,000 "success fee" to Foggia II in two payments — one of $20,000 on March 10, 1995, and another of $40,000 on April 14, 1995. Foggia II paid Canestraro $3000 on March 10, 1995, and an additional $500 on June 30, 1995, for Canestraro's work in preparing the projections for Pine Hollow. The government acknowledges it has no evidence that Foggia II made any other payments to Canestraro.

While Canestraro admitted to the above-stated facts pursuant to his plea agreement, he denies that he was a true partner in Foggia II. He claims he did not receive one-third of the $169,750 paid to Foggia II by Vukelic. Canestraro further claims he withdrew from the Foggia II partnership sometime in 1995. At Canestraro's sentencing, Vukelic testified that Canestraro called a meeting of the Foggia II partners and RSV in the late Spring or early Summer of 1995. At this meeting, Canestraro apparently stated that he wanted his name taken off the agreement between RSV and Foggia II, and that he "wanted out" of the venture. At the time of the meeting, Vukelic had made payments to Foggia II totaling between $76,000 and $77,000.

Canestraro admitted that on December 5, 1995, he called Vukelic to ask for an accounting of the gratuities paid throughout the year. He left a phone message for Vukelic, but Vukelic never returned his call.

On March 24, 2000, Canestraro waived indictment and pleaded guilty to a one-count information charging him with aiding and abetting the acceptance of an unlawful gratuity by a public official. The district court imposed a sentence of twelve months and one day of imprisonment, one year of supervised release, a $10,000 fine, and a $100 special assessment. Canestraro filed a timely notice of appeal on April 26, 2001. On May 30, 2001, the district court issued an order denying Canestraro's motion for bond pending appeal.

II. ANALYSIS

A. More Than One Gratuity

The district court enhanced Canestraro's offense level by two levels, pursuant to § 2C1.2(b)(1) of the Sentencing Guidelines, which authorizes such an enhancement "if the offense involved more than one gratuity." U.S. Sentencing Guidelines Manual ("U.S.S.G.") § 2C1.2(b)(1) (1998). Canestraro contends that the district court erred in finding that his conduct involved multiple illegal gratuities. This Court reviews the district court's findings of fact at sentencing for clear error, while the district court's interpretations of the Sentencing Guidelines are reviewed de novo. United States v. Brown, 147 F.3d 477, 485 (6th Cir.1998). The district court's application of the Guidelines to undisputed facts, however, is reviewed deferentially. United States v. Ennenga, 263 F.3d 499, 502 (6th Cir.2001). Insofar as Canestraro challenges the district court's determination of what factors may be considered in determining multiplicity, this is a "purely legal matter" that inquires into the "basic intent" of the Guidelines for which de novo review is appropriate. Buford v. United States, 532 U.S. 59, 121 S.Ct. 1276, 1280-81, 149 L.Ed.2d 197 (2001); see also United States v. Humphrey, 279 F.3d 372, 2002 WL 112482, at *5 n. 4 (6th Cir.) (concluding that legal question was presented as to whether "position of public trust" provision in the Guidelines required showing of factors indicating a level of discretion similar to that of a fiduciary). Insofar as Canestraro challenges the district court's conclusion that the specific circumstances of his case show that he aided and abetted the receipt of "more than one gratuity," we apply a deferential standard of review.

The commentary to § 2C1.2 states that "[r]elated payments that, in essence, constitute a single gratuity (e.g., separate payments for airfare and hotel for a single vacation trip) are to be treated as a single gratuity, even if charged in separate counts." U.S.S.G. § 2C1.2 commentary, applic. note 4. Other than the vacation trip example, the commentary provides little direction as to the kinds of circumstances that would warrant a finding that multiple related payments constitute a single gratuity. Canestraro contends that the court should look for interpretive guidance for the commentary to the bribery/extortion guideline, which suggests that courts consider whether the offense conduct involves "installment payments for a single action," U.S.S.G. § 2C1.1 commentary, applic. note 6, when determining whether an offense involves "more than one bribe or extortion," U.S.S.G. § 2C1.1(b)(1). We agree that this is a relevant consideration. Although a gratuity, as opposed to a bribe, does not require that the illegal payment be offered as a quid pro quo to influence an official action, the fact that a series of gratuity payments are offered in connection with multiple official acts would suggest that the...