U.S. v. Tuchow

• Decision Date: 19 July 1985
• Docket Number: Nos. 84-1350,84-1364,s. 84-1350
• Citation: 768 F.2d 855
• Parties: 18 Fed. R. Evid. Serv. 699 UNITED STATES of America, Plaintiff-Appellee, v. Martin TUCHOW and Louis Farina, Defendants-Appellants.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 855

768 F.2d 855

18 Fed. R. Evid. Serv. 699

UNITED STATES of America, Plaintiff-Appellee, v. Martin TUCHOW and Louis Farina, Defendants-Appellants.

Nos. 84-1350, 84-1364.

United States Court of Appeals Seventh Circuit.

Argued Oct. 30, 1984.

Decided July 19, 1985.

Allan A. Ackerman, Ackerman & Egan, Chicago, Ill., for plaintiff-appellee.

William Bryson, Asst. U.S. Atty., Chicago, Ill., for defendants-appellants.

Before CUDAHY and COFFEY, Circuit Judges, and GRANT, Senior District Judge. ^*

COFFEY, Circuit Judge.

The defendants Tuchow and Farina appeal a jury verdict finding them guilty of violating the Hobbs Act, 18 U.S.C. Sec. 1951. ¹ We affirm their convictions, but remand this case to allow the defendants' their right to allocution at the sentencing hearing.

I.

The majority of the evidence introduced at trial was gathered through the use of taped conversations between Jack Walsh, the government's key witness, and the defendants Tuchow and Farina. On appeal, the defendants dispute the inferences to be drawn from the statements recorded on tape.

Shortly after Jack Walsh purchased a home remodeling company named J.C. Construction in 1979, the FBI approached Walsh and informed him that they had evidence of his participation in a bank fraud. Because of this evidence, Walsh agreed to cooperate with the FBI which was conducting several other fraud investigations in Chicago in late 1979. To aid in these investigations, the FBI placed listening and recording devices throughout Walsh's office and in his telephone. In early 1980, Walsh learned of the Kenton Court condominium rehabilitation project from a friend in the construction business and immediately contacted Kaplan, a partner in the project to express his interest in the rehabilitation venture. The other individuals who comprised the Kenton Court partnership were Messrs. Radek and Golding, both of whom testified at trial. After examining the project's blueprints, Walsh concluded that the project did not meet the City of Chicago building code requirements as the building did not have enough fire exits (although he apparently did not inform the Kenton partners of his observations). ² Walsh then contacted the FBI and told them that he needed a building permit for a job which, in his opinion, did not meet the Chicago building code requirements and that he would contact a friend, the defendant Farina, to get the permit "fixed."

On May 20, 1980, Walsh called Farina and arranged to meet with him at a Chicago restaurant on the following day, May 21, 1980. When he met Farina on May 21, Walsh told him that he needed his help "in getting a building permit through" since the building had "some violations in it." Walsh testified that Farina promised to help for a $2,000 fee and warned Walsh that "now this may cost you a little more you know, whatever the situation takes." Farina, who at the time was the Deputy Commissioner of Sanitation for the City of Chicago, then suggested that he would have to bring the ward committeeman for the area, the defendant Tuchow, into the deal. Later during this May 21 conversation, Farina made several incriminating statements referring to the expected payoffs, including "for God's sake, don't tell people what you give me" and "I'll take it from here. Cause I wanna drop the money first." On June 3, Walsh again met with Farina and gave him $2,000, which was supplied to Walsh by the FBI; and at that time Farina warned Walsh not to show the money or it would "kill us all." Farina then telephoned Tuchow's office and told Tuchow that he had a client with a building permit problem for Tuchow and told him that "since it's in your ward, I think you should handle it." ³ When Walsh again met with Farina on June 4, at Farina's office in city hall, Farina explained to Walsh that he had spoken with several of his contacts who had indicated that Tuchow was not powerful enough to obtain the building permit. Farina suggested that Walsh wait until Farina was elected alderman in the fall, however, Walsh declined and asked to see Tuchow, to which Farina responded "if you want to take that chance, we'll take it." Farina and Walsh then walked to Tuchow's office. On the way Farina asked Walsh for another $1,000 for Tuchow and he also informed Walsh that it could cost "at least $10,000" to obtain the building permit.

Farina and Walsh arrived in Tuchow's office, where Tuchow explained that his price for the building permit "won't be exorbitant, but it will be substantial." Tuchow also informed Walsh that others would have to be involved. After the meeting, Farina told Walsh that it would cost more than the $10,000 he had previously quoted and that he needed another $1,000 to get Tuchow "going on finding out whoever he has to find out to fix the permit."

On June 11, after receiving money from the FBI, Walsh gave Farina $1,000 to be passed on to Tuchow. During this meeting, Farina again cautioned Walsh not to mention any names since two other aldermen had recently been convicted for fixing a building permit. Farina told Walsh that Tuchow's fee for help in obtaining the permit would be approximately $1,000 per condominium unit or $47,000.

In the meantime, the Kenton Court partnership had applied for a Federal Housing and Urban Development loan guarantee commitment of $1.5 million to help finance the project. The application for the guarantee needed to be submitted by June 27, 1980. Thus, Radek, one of the partners in the project, met with Walsh during the week of June 11th to express his concern about the time it was taking to obtain the building permit. Walsh reassured Radek that he would obtain the permit since he had earlier paid money to Farina and Tuchow; Radek responded that he did not believe any payments were necessary since the project was legitimate. On June 25, Tuchow called Walsh and told him that it looked as if the permit would go through. Walsh explained to Tuchow the emergency facing the Kenton Court partners concerning the HUD deadline and Tuchow responded that he would supply Walsh with a letter the next day authorizing Walsh to begin demolition work. During the conversation, Walsh told Tuchow that Farina had quoted a price of $47,000 for Tuchow's assistance; Tuchow responded by asking whether he (Walsh) had given Farina the $1,000 payment and Walsh answered in the affirmative. Later that day Walsh spoke with Golding, one of the Kenton Court partners, and explained that he had made payoffs to various officials for the project and that more money was expected. On June 26, Walsh went to City Hall to pick up the letter authorizing the demolition work. Tuchow and Walsh began to discuss the fee to be paid and Tuchow stated that "well, Louis shouldn't be setting prices .... I don't think I discussed that with him"; he then stated "I think Louie [Farina] misunderstood me. I told him a job like this here, to get you cleared in everything to go ahead. Got to be worth at least fifty up front." Tuchow then inquired, "when can some of this come in" to which Walsh replied, "when you want it." Walsh then agreed to pay Tuchow the following week after Tuchow returned from vacation. Walsh, Tuchow, and Noonan, an employee in the City's building department, then arranged for a demolition authorization letter to be issued the next day.

It was at this time that the FBI caught wind that Walsh was involved in another bank fraud scheme and directed him to withdraw from the Kenton Court project. As a result, Walsh informed Farina and Tuchow that he could not go forward with the deal because the Kenton partners were not willing to pay Tuchow's fee and refused to repay Walsh the money he had already paid out. Tuchow responded "that's okay, we'll just stop the job." Tuchow also informed Walsh that he did not want to deal with the partnership because "I don't even know them." Tuchow then explained to Walsh that he had put him in a bad spot since he (Tuchow) had already promised "the guy over there" (supposedly referring to Noonan) "a lot more than a couple of grand." Walsh apologetically offered that "if it takes 5 ... if it takes 10 uh, I'll do that and I don't wanna, I don't wanna embarrass myself." Tuchow accepted the $10,000 offer, "if you can get me 10 ... I'll just have to spread that around." In another conversation that same day, Walsh asked Tuchow what would happen if the Kenton partnership attempted to obtain a permit on its own and Tuchow responded "It's up to them ... if they want to go out, they won't get it though."

Over the next several weeks, Walsh began to make periodic payments on the $10,000 promise. On July 24 Walsh made a $2,000 payment to Tuchow and on July 30 he made a $1,000 payment. On October 21, Walsh made another $1,000 payment to Tuchow. During this meeting Walsh asserted that he had paid Tuchow $4,000, $3,000 directly and $1,000 through Farina. Tuchow expressed his frustration to Walsh about Farina's greed explaining that Farina had only given Tuchow $500 of the $1,000 payment intended for Tuchow, while he (Tuchow) had fairly split the proceeds of an earlier payment with Farina.

Sometime in mid-July, 1980, after Walsh informed the Kenton Court partners that he was withdrawing as the general contractor from the project, one of the partners, Radek, went to City Hall in an attempt to obtain the building permit. There he met Noonan, an employee in the City Building Department, who refused to issue a permit to Radek. Noonan told Radek that the permit had been paid for and was in Walsh's name. When Radek offered to pay the $250.00 permit fee, Noonan told Radek that he could only obtain the permit if Walsh agreed to the transfer. Noonan, testifying at trial, stated that he had been instructed by Tuchow not to authorize any transfer of the building permit at that time. Golding, called by the government as a hostile witness, testified that at a Kenton Court partnership meeting they agreed to contact Tuchow to see what could be done...