United States v. Mazzei, Crim. No. 74-319.

• Decision Date: 17 March 1975
• Docket Number: Crim. No. 74-319.
• Citation: 390 F. Supp. 1098
• Parties: UNITED STATES of America v. Frank MAZZEI.
• Court: U.S. District Court — Eastern District of Pennsylvania

390 F. Supp. 1098

UNITED STATES of America v. Frank MAZZEI.

Crim. No. 74-319.

United States District Court, W. D. Pennsylvania.

March 17, 1975.

COPYRIGHT MATERIAL OMITTED

Richard L. Thornburgh, U. S. Atty., Pittsburgh, Pa., for plaintiff.

H. David Rothman, Pittsburgh, Pa., for defendant.

OPINION AND ORDER

MARSH, Chief Judge.

After conviction by a jury the defendant, Frank Mazzei, filed a "Motion for Judgment of Acquittal or in the Alternative for a New Trial." In our opinion the motion and the alternative motion should be denied.¹

The motion sets forth the following reasons in support thereof:

2. The court erred in denying the motion for judgment of acquittal.

3. The verdict was contrary to law and against the weight of the evidence.

4. Error in refusing to declare a mistrial on the prosecutor's examination of Mr. Kelly wherein he interjected the notion that defendant might be pocketing the money received.

5. Error in allowing the witness Williams to testify to the witness Kelly's state of mind.

6. Error in ruling relative to the scope of the cross-examination of defendant in the event he testified on his own behalf which deprived defendant of the opportunity to testify in his own behalf and violated his privilege against self-incrimination.

7. Error in failing to declare a mistrial when the United States Attorney argued in his closing speech that the taxpayers of Pennsylvania could have received these leases for $20,000 less.

8. Error in refusing to charge as requested and in failing to correct its charge as requested in the particulars which appear of record.

9. Error in declining counsel's request for an individual voir dire of the prospective jurors.

10. Error in denying defense counsel's request to close last or, in the alternative, to make a brief argument in rebuttal.

11. Error in denying the motion to dismiss the indictment with prejudice made before the selection of the jury in view of the pretrial publicity which appeared on the eve of trial.

We summarize the facts in the light most favorable to the verdict winner. Glasser v. United States, 315 U.S. 60, 80, 62 S.Ct. 457, 86 L.Ed. 680 (1942); United States v. Dukow, 465 F.2d 688 (3rd Cir. 1972).

The defendant is an elected senator for the Commonwealth of Pennsylvania having been elected in the Forty-Third Senatorial District which includes the area known as the South Side, Pittsburgh, Pennsylvania. He was first elected in a special election for a one-year term to begin in January, 1968, and was subsequently re-elected for four-year terms commencing in January, 1969, and January, 1973.

BMI, Inc. (BMI) is the parent corporation and holding company of 15 or 16 subsidiaries, most of which are engaged in interstate commerce. BMI and its subsidiaries were served by the same Board of Directors. Through a subsidiary, BMI purchased a three-story building at 700 Bingham Street in the South Side on March 1, 1967. BMI occupied only one-half of the second floor, or only about 4,000 square feet of the total 60,000 square feet contained in the building. The remainder of the building was vacant and, without tenants, there were no rentals to increase the profits of the corporation or to defray the expense of the building. Attempts by BMI to rent or sell the building had been unsuccessful.

BMI was the nerve center of the accounting end of the business of all the subsidiary corporations. Practically all of the financial matters of BMI and its subsidiaries, including interstate financing transactions, were handled from the South Side location by means of interstate telephone facilities and by use of the mails. The payroll for BMI and the subsidiaries was handled through a single payroll account maintained in the Iron and Glass Bank located in the South Side not far from the BMI building.

Occupants of the BMI quarters in the South Side were: Leo B. Kelly, Vice President and Secretary/Treasurer of BMI and its subsidiaries, and a certified public accountant; Willard Bellows, the Controller; and Joseph Logan, Assistant Treasurer. Lawrence Williams, the President of BMI, had his office at another location in the Pittsburgh area. At times, the Board of Directors of BMI and its subsidiaries held meetings in the BMI building.

Mr. Kelly was also a director of the Iron and Glass Bank. Gerald R. Creehan was Vice President and Cashier of the bank. BMI was one of the bank's largest customers and Mr. Kelly had told Mr. Creehan of his desire to obtain tenants for the BMI building. According to Mr. Kelly's testimony, sometime prior to November 4, 1971, Mr. Creehan had heard that the defendant, Senator Mazzei, who had sponsored the State Lottery Bill, was looking for space in the South Side for the Pennsylvania Lottery Commission. When Mr. Creehan mentioned this, Mr. Kelly asked him to set up a meeting with the Senator. A luncheon meeting was arranged in late November, 1971, at which time Mr. Kelly entertained the Senator and Mr. Creehan, and told Senator Mazzei that BMI desired to lease space in its building.

A short time later the Senator visited the BMI building with a Samuel Myers and informed Mr. Kelly that the State would lease the first floor at the rate of $4.25 per square foot. Mr. Kelly did not negotiate the lease or price with anyone connected with any executive department of the State Government, although there were inspections made by employees of executive agencies. On January 8, 1972, Mr. Kelly again entertained the Senator and Mr. Creehan, this time at a dinner attended by the men's wives. In his testimony Kelly characterized the dinner as primarily a business meeting.

The defendant made it clear to Mr. Kelly that he expected a kickback. Mr. Kelly testified that the Senator told him at a January 11, 1972 meeting in Mr. Kelly's office that:

"it was the practice on all state leases that a ten per cent of the gross amount of the rentals would be paid to a senate finance re-election committee and that these funds were used for the incumbents or the senators of both parties, and that that would have to come out of the four and a quarter." (Tr. p. 207).

Penciled calculations (GX 7) made by the Senator indicated that the net amount of the rental for five years would be ten percent less than the gross. The Senator asked Mr. Kelly if that was satisfactory and Mr. Kelly replied in the affirmative. The Senator stated that ten percent should be paid in cash at the beginning of the lease term and inquired of Mr. Kelly if that created any problem. Mr. Kelly replied in the negative. Following the meeting, Mr. Kelly informed Mr. Bellows and Mr. Logan of the terms of the arrangement and showed them the paper on which the Senator made his calculations. Mr. Kelly also informed Mr. Williams and other stockholders about the arrangement.

A lease proposal form was mailed to the State by BMI on January 13, 1972. An unexecuted lease arrived from Harrisburg about February 23rd. The lease was executed by BMI officers and returned to Harrisburg. BMI received the final lease executed by the Commonwealth about March 23, 1972. On March 24, 1972, the Senator called at the Iron and Glass Bank for the money. At the direction of Mr. Kelly, Mr. Creehan and another bank employee delivered $8,755.00 in cash to the defendant at his office which was almost across the street from the bank. There was no evidence that this kickback was ever paid to a senate re-election committee as the Senator had represented.

In November or December, 1972, Senator Mazzei inquired of Kelly about leasing space to the Department of Labor and Industry. An employee of the Department visited the premises on December 27, 1972. Subsequently, the defendant advised Mr. Kelly that a rate of $4.90 per square foot would be paid by the State and also advised that the same arrangement would be in effect whereby ten percent would be paid to the re-election committee. At a July 18, 1973 meeting in Kelly's office the Senator began calculations on a BMI note pad to determine the total rental for the five-year term of the second lease. Mr. Kelly completed these calculations and determined that the kickback would be about $11,300.00 (GX 12).

When BMI submitted this lease proposal, however, it requested a rental rate of $4.35 per square foot because it did not wish to provide janitorial service or trash removal. Mr. Kelly testified that Senator Mazzei later called him to say that "the Commonwealth or the Department, whoever takes care of leasing" (Tr. p. 262) would not accept the premises without these services and that the rate should be $4.90 and the proposal should include janitorial and trash removal services. During the telephone conversation with the Senator, Mr. Kelly agreed to these changes. No amended proposal form was ever submitted by BMI, but when the lease was received from the State it provided for a rate of $4.90 per square foot.

On Friday, July 20, 1973, Mr. Kelly was told by Senator Mazzei that the second lease had been executed by the State and that the Senator needed the money to take with him to Harrisburg on Monday. Mr. Kelly, accompanied by Mr. Williams, President of BMI, obtained $11,299.56 in cash from the bank and walked to the defendant's office where Mr. Kelly personally handed the money to the defendant's secretary. Later that same day, in a telephone conversation with Mr. Kelly, the Senator acknowledged receipt of the money. There was no evidence that this kickback was paid to a senate re-election committee. Defendant and his wife were entertained in Florida in early 1974 by an employee of BMI because a third lease with the State was pending.

The defendant indicated a consciousness of wrongdoing when he subsequently, according to Mr. Kelly's testimony, told Mr. Kelly not to reveal the payments to anyone. Later when the Senator visited Mr. Kelly's office and learned that Mr. Kelly had told his attorney everything about the leases and the payments, the Senator told Mr. Kelly that the FBI would...