United States v. Ciavarella
Decision Date | 24 August 2020 |
Docket Number | CRIMINAL NO. 3:09-CR-272 |
Citation | 481 F.Supp.3d 399 |
Parties | UNITED STATES of America v. Mark A. CIAVARELLA, Jr., Defendant |
Court | U.S. District Court — Middle District of Pennsylvania |
Stephen R. Cerutti, II, C. D. Marchioli, Michael A. Consiglio, United States Attorney's Office, Harrisburg, PA, William Spencer Houser, United States Attorney's Office, Scranton, PA, for United States of America.
Defendant Mark A. Ciavarella, Jr., is a former judge of the Court of Common Pleas of Luzerne County, Pennsylvania. In February 2011, a jury found Ciavarella guilty of racketeering, racketeering conspiracy, honest-services mail fraud, money-laundering conspiracy, conspiracy to defraud the United States, and subscribing and filing a materially false tax return. Ciavarella was sentenced to 336 months’ imprisonment. In 2018, we vacated three of Ciavarella's convictions pursuant to 28 U.S.C. § 2255 after concluding that he had been prejudiced by his trial counsel's failure to raise a statute-of-limitations defense. The parties now dispute what relief, if any, Ciavarella is entitled to under Section 2255.
Ciavarella served as judge on the Luzerne County Court of Common Pleas from 1996 through January of 2009. United States v. Ciavarella, 716 F.3d 705, 713 (3d Cir. 2013). During his tenure, Ciavarella served primarily on the Juvenile Court. Id. Ciavarella was appointed President Judge in January of 2007, succeeding his former colleague and codefendant, Michael T. Conahan. Id. at 713-14. In late 2008, Ciavarella and Conahan were accused of receiving nearly $3 million in exchange for their respective roles in facilitating construction and ensuring continued operation of two private juvenile detention centers in the Commonwealth of Pennsylvania. Id. at 713. Two other key players—commercial builder Robert Mericle and local attorney and businessman Robert Powell—were also criminally charged. See United States v. Mericle, No. 3:09-CR-247, Doc. 1 (M.D. Pa. Aug. 13, 2009); United States v. Powell, No. 3:09-CR-189, Doc. 1 (M.D. Pa. June 6, 2009).
Prosecution of Ciavarella and Conahan began with the filing of a felony information charging honest-services wire fraud and conspiracy to defraud the United States. See United States v. Ciavarella, No. 3:09-CR-28, Doc. 1 (M.D. Pa. Jan. 26, 2009). Both defendants entered into Rule 11(c)(1)(C) plea agreements in which all parties stipulated to a binding sentencing recommendation of 87 months’ imprisonment. See id., Docs. 3, 5. Following receipt and review of defendants’ presentence reports, the late Judge Edwin M. Kosik rejected the plea agreements, concluding that the proposed sentences fell "well below" the Guidelines for the offenses charged. United States v. Conahan, No. 3:09-CR-28, 2009 WL 6032443, at *2-3 (M.D. Pa. July 31, 2009). Ciavarella and Conahan withdrew their guilty pleas.
On September 9, 2009, a grand jury returned a 48-count indictment against Ciavarella and Conahan. Defendants answered the indictment with a barrage of pretrial motions—44 in all. Shortly thereafter, Conahan agreed to plead guilty to racketeering conspiracy. Judge Kosik accepted Conahan's guilty plea on July 23, 2010.
Two months later, the grand jury returned a 39-count superseding indictment charging Ciavarella as follows:
Count 1 alleged 13 separate acts of racketeering activity to support the racketeering charge. The superseding indictment also included a forfeiture notice. Ciavarella renewed his earlier pretrial motions and filed several additional motions to dismiss. Judge Kosik denied those motions in a memorandum and order dated December 15, 2010.
Ciavarella's trial commenced with jury selection on February 7, 2011. Evidence at trial established that Ciavarella and Conahan introduced Powell and Mericle to one another with the goal of constructing a private juvenile detention center in Luzerne County to replace a dilapidated county-run facility. See Ciavarella, 716 F.3d at 714. Powell and a business associate created Pennsylvania Child Care, LLC ("PACC"), to develop the center and hired Mericle's construction company to build it. Id. As part of a successful effort to thwart the county's plan to build its own facility, and in order to assist Powell in securing a bank loan, Ciavarella and Conahan executed a placement agreement between the county and PACC, guaranteeing placement of the county's juvenile offenders at PACC at a contract price of $1.314 million per year. Id. In January 2003, as construction neared completion, Mericle transferred a "referral fee" of $997,600 in three separate payments to Ciavarella and Conahan in a series of wire transfers between various conduits. Id.
The jury heard evidence that Ciavarella, in his capacity as judge on the Juvenile Court, "leveraged" his position "to place juvenile offenders with PACC" to ensure the facility's continued success. Id. at 715. According to Powell's trial testimony, both Ciavarella and Conahan believed they were entitled to join in that success. See id. The judges directed Powell to transfer their perceived "share" of the profits to Pinnacle Group of Jupiter, LLC ("Pinnacle"), a corporation they formed with their wives and used to channel funds associated with PACC. Id. at 714-15. From January through September 2004, Powell made payments to Pinnacle totaling $590,000. Id. at 715. He disguised the payments by labeling them as "rent" for an uninhabitable condominium purchased by Pinnacle in Jupiter, Florida. Id.
When Mericle and Powell decided to build a second juvenile detention center, Western PA Child Care ("WPACC"), and to expand PACC, Ciavarella and Conahan received two more "referral fees": $1 million in July 2005 for WPACC's construction and $150,000 in February 2006 for PACC's expansion. Id. at 714. Powell distributed additional proceeds to the judges totaling $143,500 between August and December 2006 by delivering "boxes filled with cash" to Conahan and his judicial assistant. Id. at 715. Ciavarella admitted at trial that he falsified tax returns to conceal his additional income from the Internal Revenue Service and failed to report financial interests in PACC and WPACC to the Administrative Office of the Pennsylvania Courts. (See Doc. 235, 2/15/11 Trial Tr. 58:18-59:19, 69:7-72:2); see also Ciavarella, 716 F.3d at 714-15. He denied that any payments were bribes, kickbacks, or the product of extortion (he "always considered that money to be a legal finder's fee"), (Doc. 235, 2/15/11 Trial Tr. 25:18-26:13; see also id. at 67:17-19; Doc. 232, 2/8/11 Trial Tr. 27:16-28:8, 31:25-45:21), and he denied any knowledge of the "rent" payments and the deliveries of cash, (see, e.g., Doc. 235, 2/15/11 Trial Tr. 29:6-32:12, 46:18-47:3, 64:4-6, 65:11-16, 66:3-7).
After seven days of evidence and two and a half days of deliberation, the jury convicted Ciavarella on 12 of 39 counts: racketeering (Count 1), racketeering conspiracy (Count 2), all four counts of honest-services mail fraud (Counts 7-10), money-laundering conspiracy (Count 21), conspiracy to defraud the United States (Count 35), and all four counts of subscribing and filing a materially false tax return (Counts 36-39). The jury identified two acts of racketeering activity in support of its verdict on Count 1: Racketeering Act One, charging honest-services wire fraud for $997,600 in wire transfers on January 21, January 24, and January 28, 2003, and Racketeering Act Thirteen, charging money-laundering conspiracy. Ciavarella filed several posttrial motions, all of which were denied.
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