United States v. DeSapio

• Decision Date: 16 November 1970
• Docket Number: Docket 34689.,No. 158,158
• Citation: 435 F.2d 272
• Parties: UNITED STATES of America, Appellee, v. Carmine G. DeSAPIO, Defendant-Appellant.
• Court: U.S. Court of Appeals — Second Circuit

435 F.2d 272 (1970)

UNITED STATES of America, Appellee, v. Carmine G. DeSAPIO, Defendant-Appellant.

No. 158, Docket 34689.

United States Court of Appeals, Second Circuit.

Argued September 18, 1970.

Decided November 16, 1970.

COPYRIGHT MATERIAL OMITTED

Jack Kaplan, Asst. U. S. Atty. (Whitney North Seymour, Jr., U. S. Atty. for Southern District of New York, Arthur A. Munisteri, James Schreiber and Robert G. Morvillo, Asst. U. S. Attys., of counsel), for appellee.

Maurice Edelbaum, New York City (Edelbaum, Abrams, Feitell & Edelbaum, New York City, Lawrence K. Feitell, and Henry J. Boitel, New York City, of counsel), for defendant-appellant.

Before FRIENDLY, SMITH and HAYS, Circuit Judges.

FRIENDLY, Circuit Judge:

In December 1968 a grand jury in the District Court for the Southern District of New York returned an indictment against Carmine DeSapio, Antonio Corallo, and Henry Fried. The latter's case was severed because of illness. After a four-and-a-half week trial, Corallo was convicted on one of the three counts charged in the indictment and acquitted on another, and the third count was dismissed as to him; he has not appealed.¹ Appellant DeSapio was convicted on one count of conspiring to violate 18 U.S.C. § 1951, which prohibits the obstruction of commerce by extortion, and 18 U.S.C. § 1952, which prohibits travel in interstate or foreign commerce or utilization of any facility in such commerce to commit bribery, and of two substantive violations of the latter section. More intelligibly stated, the charge was that DeSapio conspired with Fried and others to bribe James Marcus, then Commissioner of the New York City Department of Water Supply, Gas and Electricity to withhold permits sought by Consolidated Edison Company of New York, Inc. (Con Ed) until Con Ed would agree to award construction contracts to Fried's companies. DeSapio was sentenced to a term of two years imprisonment on each count concurrently and to fines of $1,500 on each of the three counts.

I.

A summary of the evidence is needed to understand DeSapio's legal contentions. In the interest of keeping this opinion to manageable size, we shall endeavor to limit ourselves to the essentials, although in doing so we necessarily omit much evidence which one side or the other would doubtless deem significant.

The story constitutes a second act in the drama involving Commissioner Marcus and Herbert Itkin, who combined the roles of underworld character and FBI informer, of which United States v. Corallo, supra, 413 F.2d 1306, was the first. The evidence in that case depicted how Marcus, hard-pressed by loan sharks, had agreed with Corallo, Itkin, and Daniel Motto to award a contract for the renovation of a reservoir in Jerome Park in the Bronx to a construction company headed by Fried without competitive bidding, in return for Fried's promise to kick back 5% of the price. This success led Corallo, Marcus, and Itkin to agree that similar arrangements should be placed in operation elsewhere. Corallo mentioned that Con Ed was a prime target since it was constantly making contracts and also was requiring permits from the Water Department to dig in city streets. Not long after this, but in ignorance of what had been planned, Con Ed requested Water Department approval of a project to reconstruct and enlarge a power transmission facility known as the "high line," 20 miles of which ran atop the Catskill Aqueduct on a City owned right-of-way in Westchester County.

The first approach to Con Ed was made by Milton Lipkins, vice president of Broadway Maintenance Corporation. At a luncheon he asked Max Ulrich, Con Ed's vice president for public relations, about the company's "relationships" with the Water Department. After saying they were "reasonable," Ulrich indicated two major projects in the offing that would require Water Department approval — the "high line" and a pump storage hydroelectric facility at Storm King Mountain near the Catskill Aqueduct. Lipkins said he had heard the company's relations with the Department were very bad and that, through his friends "who were close to the Department," these relations would be improved if Con Ed would award some 5% to 10% of its business to the Orlando Construction Company, headed by Edward Orlando. Lipkins gave Itkin a somewhat rosy version of his success at the conference. Itkin relayed the good news to Marcus and Corallo, who suggested that if the prospective Storm King construction contracts, estimated at $100,000,000, were awarded to certain construction concerns, the three might share 40-50% of the profits. There is no contention that DeSapio played any role in these preliminaries.

Late in June or early in July, Fried, who had learned of the démarche with Con Ed and was distressed at the prospect of being excluded from the business, asked Marcus to meet him, and Marcus requested Itkin to come along. After some small talk, in the course of which Marcus told Fried to speak to Itkin as if to himself and Fried invited Marcus and Itkin to the forthcoming opening of his multimillion dollar horsefarm in Germantown, N. Y., Marcus left. Fried then asked Itkin why he and Marcus were "fooling around" with little companies like Orlando, boasted of his ability to raise $250,000 for pay-offs on 24 hours notice, and claimed to have the chairman of the New York County Republican party, and DeSapio, past chairman of the New York County Democratic party, on his payroll. Itkin did not immediately take up the lead; instead Lipkins pursued Ulrich, without success.

Early in August, Edward Orlando, who had decided to accept Fried as a "partner" on Con Ed contracts, met with him and Itkin. According to Itkin, Fried again deprecated the Lipkins-Ulrich gambit and said, "if you want to deal, come up to my farm, and I will introduce you to Carmine DeSapio and then you will be really working it right." Fried recommended a route through New Jersey and accommodations in a nearby hotel. At a meeting in Itkin's apartment on August 15, Corallo expressed to Marcus and Itkin his dissatisfaction with Lipkins' lack of progress.

The opening of the horsefarm on August 20 was attended by approximately a thousand guests. Itkin, who had used the recommended route and hotel, arrived between 1 P.M. and 2 P.M. According to him, while he was sitting with Orlando early in the afternoon, Fried came up to his table and led him off to be introduced to DeSapio. Fried said he had spoken to each man separately and, if they could work together, he would do his end. DeSapio allegedly said Itkin had been handling himself poorly and offered to help if Itkin would agree to work with no one else. Itkin accepted and was sure that Marcus would also; DeSapio gave Itkin his unlisted office telephone number. In his testimony DeSapio admitted that he knew Fried well and attended the opening in the company of Frank G. Rosetti, leader of the New York County Democratic party, and their wives. He claimed that Itkin came up alone, introduced himself as a friend of Marcus, and asked what DeSapio thought of Mayor Lindsay's administration. On two later occasions during the afternoon Itkin gave the DeSapio-Rosetti party lifts to and from the clubhouse. DeSapio did not see Fried except at the clubhouse toward the end of the day.²

Soon thereafter Itkin told Marcus that DeSapio had called and would "handle" the Con Ed negotiations. Later in the month Itkin asked Marcus if he knew about the high line; Marcus inquired of his engineers and learned about it for the first time.

Itkin claimed to have met DeSapio on September 6 at the coffee shop in the Biltmore Hotel. DeSapio reiterated his poor opinion of Itkin's and Marcus' tactics and warned Itkin to stay in constant touch with him since he had been getting "insurance contracts" with Con Ed for years.³ He said the Storm King project was too big for a starter and that the conspirators should use the high line to teach Con Ed the necessity of dealing through them. DeSapio denied this meeting.

On the same day Con Ed's vice president and chief engineer, Duncan, called upon Marcus with respect to the delay since May 9 in approving the high line project. Reviewing Con Ed's request, Marcus indicated there was no problem so far as he was concerned, although he would need added technical data, and instructed Groopman, the Department's chief engineer, to prepare a letter to that effect. Itkin testified that, on his relaying this news, DeSapio was indignant since "it is much too early for me to make a move to impress upon them Con Ed they have to come to me" and instructed that the letter be held up. On learning this, Marcus took Groopman's draft letter to the office of the Corporation Counsel, hoping thereby to obtain the desired delay. Instead of pondering about the letter which, even as drafted by Groopman, was merely a consent in principle subject to approval of engineering details and a caveat that Con Ed's contract to use the right of way would have to be renegotiated with the Board of Estimate, Assistant Corporation Counsel Redlich immediately prepared an insert making clear that Con Ed was not to incur any expense in reliance upon the approval in principle until the Department notified the company that the construction would not harm the Catskill Aqueduct. Marcus decided not to send the letter but rather to hold back for a while and then refer the matter to the Director of the Bureau of Franchises for renegotiation of the fee.

A fortnight later Luce, the new chairman of the board of Con Ed, paid his first official visit to Mayor Lindsay, at Gracie Mansion, encountered Marcus there, and pressed for approval of the high line project. Marcus went back to his office and had the Groopman-Redlich draft typed but did not send it. Itkin testified that the next day he met again with DeSapio at the Biltmore dining room.⁴ DeSapio objected again to Marcus' being too compliant. Itkin related the financial pressures on Marcus;...