U.S. v. Gruttadauria
| Decision Date | 21 July 2006 |
| Docket Number | No. 05-CR-717(ADS)(WDW).,05-CR-717(ADS)(WDW). |
| Citation | 439 F.Supp.2d 240 |
| Court | U.S. District Court — Eastern District of New York |
| Parties | UNITED STATES of America, v. Nicholas Michael GRUTTADAURIA, also known as "Beaver" and "Nicky G," Ronald Pecoraro, also known as "Ronald Russo" and "Frank Pecoraro," Joseph Rutigliano, also known as "Joe Box" and "Joe New York," David Gross, Kim Brady Land, Mustafa Kahraman, also known as "Mike", Nedim Sirin, Metin Sap, Michael Costigliola, John Cavallo, also known as "Jack", Giovanni Vella, also known as "John Vella" and "Mousey," Birol Mete, also known as "Billy Boy," Mecit Sahin, also known as "John," Salvatore Rubino and Salvatore Cesarino, Defendants. |
Roslynn R. Mauskopf, United States Attorney, Eastern District of New York by James M. Miskiewicz, Assistant United States Attorney, Central Islip, NY, for U.S.
Law Offices of Glenn A. Obedin by Glenn A. Obedin, Esq., Central Islip, NY, for the defendant Nicholas Michael Gruttadauria.
Alan M. Nelson, Esq., Lake Success, NY, for the defendant Ronald Pecoraro.
Jerome A. Scharoff, Esq., Leonard R. Sperber, Esq., Garden City, NY, Co-counsel for the defendant Joseph Rutigliano.
John F. Carman, Esq., Garden City, NY, for the defendant David Gross.
Law Offices of Robert C. Gottlieb by Robert Curtis Gottlieb, Esq., Commack, NY, for the defendant Kim Brady Land.
Law Office of Peter J. Tomao by Peter J. Tomao, Esq., Garden City, NY, for the defendant John Cavallo.
Law Offices of Thomas F. Liotti by Thomas F. Liotti, Esq., Garden City, NY, for the defendant Giovanni Vella.
This case arose out of an investigation that uncovered numerous illegally operated gambling businesses spread throughout Nassau and Suffolk counties and a money laundering conspiracy involving an elected Judge of the Nassau County District Court. Presently before the Court are various motions by defendants Nicholas Michael Gruttadauria ("Gruttadauria"), Ronald Pecoraro ("Pecoraro"), David Gross ("Gross"), John Cavallo ("Cavallo"), and Giovanni Vella ("Vella"), to dismiss the indictment, suppress evidence, disclose additional evidence, and sever the trials of various counts and defendants.
On September 28, 2005, a grand jury returned a six count indictment against fifteen defendants (the "Indictment") on various charges. Count One charges all of the defendants, with the exception of Gross and Kim Brady Land ("Land"), with conspiracy to operate an illegal gambling business, in violation of 18 U.S.C. §§ 371 and 1955. Count Two charges Pecoraro and Joseph Rutigliano ("Rutigliano") with conspiracy to commit extortion in violation of 18 U.S.C. § 1951. Count Three charges Gruttadauria and Gross with conspiracy to receive and dispose of stolen merchandise in violation of 18 U.S.C. §§ 371 and 2351. Count Four charges Gruttadauria, Gross, and Land with a money laundering conspiracy in violation of 18 U.S.C. §§ 1956(h) and 2315. Counts Five and Six charge Pecoraro with illegal possession of a weapon and possession of a defaced weapon in violation of 18 U.S.C. §§ 922(g)(1), 922(k), 924(a)(1)(B), and 924(a)(2).
According to the affidavits submitted in support of the arrest and search warrants in this case, the government intends to show at trial, through confidential informants, wiretaps, and other evidence, that Gruttadauria has been an associate of the Genovese organized crime family of La Cosa Nostra since 1985, and has used his position as a "soldier" in such organization to direct the two illicit conspiracies alleged in the indictment.
The first conspiracy, charged in Count One of the Indictment, alleges that between February 2003 and August 2005, Gruttadauria, along with his partners Rutigliano and Pecoraro, conspired with Cavallo and Vella, among others, to operate a single illegal gambling business on Long Island. This scheme was carried out by organizing and managing illegal gambling sites in separate restaurants and cafes that had back-room establishments, and also locations purporting to be social clubs that cater primarily to the Turkish community.
Although in separate locations, it is alleged that the gambling establishments functioned as a single network supervised by Gruttadauria and under the direction and control of Rutigliano and Pecoraro, who made daily collections totaling approximately $16,000 a week. The government further alleges in Count Two that Rutigliano and Pecoraro committed extortion by unlawfully enforcing their control over the operations of the Turkish gambling clubs against any individuals who sought to replace the machines or contact law enforcement.
One of the social clubs in the illegal gambling scheme was the Delta Seven Club located in West Hempstead, New York, which was allegedly owned by Vella and Cavallo. On January 14, 2004, the Nassau County Police Department ("NCPD") executed a search warrant on the Delta Seven Club and arrested and charged Vella, among others, with promoting gambling, in the second degree, and possession of gambling devices, in the second degree. During the raid Cavallo was present at the club, and was identified by both an undercover NCPD Detective and an FBI Special Agent, both of whom had observed him on previous occasions. According to the Special Agent, Cavallo is known to the FBI to be a long-time associate of Peter Gotti, a former captain and acting boss of the Gambino crime family.
Cavallo's alleged ownership in the Delta Seven Club and his association with the Gambino crime family is an integral part of the government's case. On November 29, 2003, Pecoraro was intercepted negotiating with a confidential informant for assistance with the installation of gambling machines at the Delta Seven Club. In this conversation, Cavallo, who the government alleges is referred to by Pecoraro as "Jack" in the conversation, is reported to be "the main guy" at the Delta Seven Club, and, in an apparent reference to his superior position in the crime family hierarchy, has "a little strength behind `em too."
The second conspiracy, charged in Counts Three and Four of the indictment, alleges that Gruttadauria, along with Gross, who at the time was an elected Judge of the Nassau County District Court, and Land, who owned a restaurant in Freeport, New York, laundered approximately $130,000 in funds represented to be the proceeds of stolen merchandise. The investigation also revealed that Gruttadauria had an association with Gross, who is referred to on recorded wire taps as "the judge." In one conversation, Gruttadauria spoke to Rutigliano and discussed a meeting he had with "the judge" and a person known to be an acting captain of the Genovese crime family.
This scheme was discovered during the investigation into the gambling conspiracy when an FBI undercover agent approached Gruttadauria for assistance in laundering the proceeds of stolen diamonds. Over the course of several meetings between Gruttadauria and the under cover agent, Gruttadauria suggested that the undercover agent launder his funds by opening a gambling club that he could help establish by introducing him to people in New York. On January 27, 2005, the undercover agent met with Gruttadauria, Pecoraro, Gross, and other individuals at the Garden City Hotel in Garden City, New York. During the meeting, the undercover agent mentioned to Gross that he was involved in the diamond business, to which Gross responded that he knew people in that business.
At a subsequent meeting the next day, January 28, 2005, the undercover showed Gruttadauria 19 loose diamonds, and inquired if he knew a buyer for the stolen goods. Gruttadauria noted that "the judge" knew jewelers and suggested to the undercover agent that he contact Gross to come up with a buyer for the diamonds. Later that day, Gross met with the undercover agent, and in his presence made several unsuccessful inquiries over the telephone to sell the diamonds, which he described over the phone as "orphans in need of a new home." After the telephone call, Gross indicated that he was purchasing a restaurant in Freeport, New York, known as "Café by the Sea," and that the sale was documented at a lower price to reduce tax burdens by transferring $200,000 in cash to the seller, who was defendant Land, and indicated that this may present a viable option for laundering the funds once the diamonds were sold.
The next day, January 29, 2005, Gross met with the undercover agent again to further discuss how to launder the proceeds of the stolen diamonds once they were sold. Gross suggested that the undercover agent launder the funds through Gross's 2005 re-election campaign fund account by posing as a political consultant and professional fund raiser. Gross then explained that he would charge a laundering fee that they could negotiate at a later point. However, as the conversation progressed, it was determined that this method would not be feasible because of the public disclosure requirements associated with campaign finance.
As an alternative, Gross suggested that documentation be created to make it appear as though a political party was held at a restaurant. This proposed scheme involved paying the restaurant $10,000 in cash, and then having the restaurant issue checks to various accounts held by the undercover agent as purported payments for fund raising expenses incurred in hosting the event. Gross then proceeded to telephone Land and arrange a meeting later that day to execute the plan.
Later that same day, Gruttadauria, Gross, Land, and the undercover agent met at the Café by the Sea restaurant in Freeport. The four discussed the plan to launder the cash by using the restaurant and Land agreed to the idea for a 16 percent fee. The transaction was completed that night after the diamonds were sold, as follows: The...
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