U.S. v. Costanzo

• Decision Date: 05 June 1980
• Docket Number: No. 79-1834,79-1834
• Parties: UNITED STATES of America v. Anthony J. COSTANZO, Appellant.
• Court: U.S. Court of Appeals — Third Circuit

Page 465

625 F.2d 465

UNITED STATES of America v. Anthony J. COSTANZO, Appellant.

No. 79-1834.

United States Court of Appeals, Third Circuit.

Argued Jan. 17, 1980.

Decided June 5, 1980.

Michael H. Kessler (argued), Kendall & Kessler, Union, N. J., for appellant.

Robert J. Del Tufo, U. S. Atty., Samuel A. Alito, Jr. (argued), Asst. U. S. Atty., Newark, N. J., for appellee.

Before HUNTER, HIGGINBOTHAM and SLOVITER, Circuit Judges.

OPINION OF THE COURT

SLOVITER, Circuit Judge.

Anthony J. Costanzo appeals from an order of the district court denying both his motion for a new trial brought pursuant to Rule 33 of the Federal Rules of Criminal Procedure and his motion under 28 U.S.C. § 2255 to vacate the federal sentence he is currently serving. Costanzo was convicted on both counts of a two count indictment for conspiracy to possess and possession of stolen United States Treasury checks in violation of 18 U.S.C. § 371 and 18 U.S.C. § 1708.

Costanzo, citing numerous grounds warranting reversal of his conviction, claims the trial judge erred in refusing to grant an evidentiary hearing before denying the motions. We find Costanzo's most substantial claim to be the alleged error committed by the district court in refusing to conduct an evidentiary hearing on Costanzo's claim that his Sixth Amendment right to counsel was violated because Frank Paglianite, an attorney whom Costanzo consulted, furnished information to F.B.I. agents. We will review that claim first.

Facts

Nine Treasury income tax refund checks mailed to Brooklyn payees never arrived at their destination. According to the trial testimony of Patrick Kelly, a Government informant, Costanzo and Robert Stasio met outside Kelly's office where Costanzo sought to find a purchaser for the stolen checks. Kelly was not helpful at that instance, but after being given instructions by F.B.I. agents, he directed Costanzo to F.B.I. agent Leonard Pedreira (using an alias Lenny Perrone). Costanzo met Perrone at Mid-Atlantic Air-Sea Transport, a sham trucking company staffed by undercover agents, and, in a conversation with Perrone (tape-recorded by another police officer), he offered to sell the stolen checks. Perrone delayed making a decision. Costanzo returned a few days later, and, in the course of another recorded conversation, sold the checks to Perrone and received in return $1,500 paid in thirty pre-marked $50 bills.

Costanzo's defense, consisting of his testimony, was that the Government entrapped him because it was dissatisfied with his role as a Government informant. Costanzo claimed Kelly gave him an envelope and told him it was a mortgage application which he should take to Mid-Atlantic. When he opened the envelope he was carrying and saw the checks, he pursued the sale in order to gather information about Kelly which he planned to turn over to the Government. He also said that he fabricated some of the references to criminal activity in his conversation with Perrone, and that the other incriminating statements he made at that time were based, not on his own information, but on facts told to him by Kelly. He said he did this in an attempt to "blend in" at Mid-Atlantic which he suspected was an illegal operation so he could obtain information and report to the Government. Before the trial, Costanzo's co-defendant, Robert Stasio, pled guilty to the conspiracy count as part of a plea bargain. Costanzo was found guilty after a two-week jury trial which began January 3, 1978.

After Costanzo's conviction but before sentencing, he moved for a new trial based on newly discovered evidence. The motion was denied and Costanzo was fined and sentenced to two and one-half years' imprisonment, to be followed by five years' probation. The conviction was affirmed by this court. United States v. Costanzo, 591 F.2d 1337 (3d Cir.), cert. denied, 441 U.S. 961, 99 S.Ct. 2405, 60 L.Ed.2d 1065 (1979).

On June 6, 1979, the day Costanzo was ordered to surrender, he filed another motion for a new trial and a motion to vacate pursuant to 28 U.S.C. § 2255, claiming inter alia, intrusion by the Government into his attorney-client relationship. Because of the trial judge's unavailability at that time, consideration of the motions was delayed until June 25. Shortly before argument was scheduled to begin, defense counsel presented the court with additional affidavits and supporting material but the court refused to accept them for filing. ¹

In his § 2255 motion, Costanzo alleged that he employed the services of Frank Paglianite as an attorney since 1971 on various civil and criminal matters; that Paglianite attended a meeting between Costanzo and various Government officials when Costanzo decided to become a Government informant in the spring of 1975; that during the next year and a half, when Costanzo reported to the Government on various illegal activities of persons with whom he associated, he frequently consulted Paglianite; that Paglianite arranged for Costanzo's bail after his arrest on the instant charges and that Costanzo considered having Paglianite represent him until he learned that the attorney was precluded from doing so because of a conflict of interest. Costanzo further alleged that he discussed trial strategy and tactics with Paglianite during his trial and that his trial detective also discussed various aspects of the case with Paglianite. Finally, Costanzo claimed that during the course of his relationship with Paglianite, the attorney was an informant of the Federal Bureau of Investigation and related Costanzo's trial strategy to the Government.

The Government's answer to Costanzo's motion simply asserted that no claim was presented warranting relief. Significantly, the Government did not deny that it received information from Paglianite. On the contrary, it attached to its answer the affidavit of special agent Cyrus Falls which admitted that he received information from Paglianite about Costanzo from September 28, 1977 through January 13, 1978. Attached to Falls' affidavit are the F.B.I. reports summarizing the information received from Paglianite relating to Costanzo. These reports show that the F.B.I. was aware of Paglianite's relationship with Costanzo. For example, the following memorandum was prepared by the F.B.I.:

As (Paglianite) is a New Jersey attorney, he periodically is requested to represent various individuals who are under investigation by the Newark or New York Offices of the FBI.

The source has emphatically stated to SA FALLS, on each contact, that he has not and will not represent any of the individuals arrested by the Newark Office New Jersey State Police on 9/28/77 (including Costanzo). He stated, however, that several of those individuals were former clients and are associates and, therefore, they would periodically be in contact with him in matters relating to various financial schemes.

He was informed that any information volunteered by him would be accepted; however, no defense type strategy should ever be brought to the agent's attention.

The source emphatically stated that although he has this association with the individuals arrested he has not been retained by them as an attorney and he does not plan to allow this to happen.

The district court denied Costanzo's motion without holding an evidentiary hearing. On appeal the Government contends that Costanzo's motion, together with court files and records, shows that Costanzo did not have an attorney-client relationship with Paglianite with respect to the present case. It denies that any information relating to Costanzo's trial strategy was conveyed to it by Paglianite.

As to the existence of an attorney-client relationship, the Government stresses that under the decision in In re Grand Jury (Markowitz ), 603 F.2d 469 (3d Cir. 1979), Costanzo had the burden of establishing the existence of an attorney-client relationship with Paglianite. In support of its argument that Costanzo failed to discharge that burden, the Government relies on the fact that the court records show that Paglianite never entered an appearance on Costanzo's behalf. The Government also points to Costanzo's statement in his motion that he considered using Paglianite as his trial counsel but decided not to retain him after he heard the arraignment judge advise Paglianite of a potential conflict of interest, and concludes that because Costanzo knew Paglianite could not serve as his counsel with respect to the present case he could not expect statements made to Paglianite to be the subject of an attorney-client privilege.

Secondly, the government notes that F.B.I. agent Falls avers in his affidavit that he repeatedly informed Paglianite not to relate "defense type strategy" and contends that no such protected information was related by the attorney to F.B.I. agents.

Discussion

Section 2255 provides in part:

Unless the motion and the files and records of the case conclusively show that the prisoner is entitled to no relief, the court shall cause notice thereof to be served upon the United States attorney, grant a prompt hearing thereon, determine the issues and make findings of fact and conclusions of law with respect thereto.

28 U.S.C. § 2255 (emphasis added).

It is well established that where a "motion for relief under § 2255 raises an issue of fact which cannot be conclusively determined from 'the motions and the files and records of the case,' the movant is entitled to a judicial hearing at which he and his witnesses may be heard." Del Piano v. United States, 362 F.2d 931, 933 (3d Cir. 1966) (per curiam). See also Machibroda v. United States, 368 U.S. 487, 82 S.Ct. 510, 7 L.Ed.2d 473 (1962); Lindhorst v. United States, 585 F.2d 361 (8th Cir. 1978); Taylor v. United States, 487 F.2d 307 (2d Cir. 1973) (per curiam).

Review of the motion and the Government's response discloses at least two material issues of fact: (1) whether there was an attorney-client relationship between Costanzo and Paglianite which...