United States v. Repak

• Decision Date: 28 March 2017
• Docket Number: No. 15-4011,15-4011
• Citation: 852 F.3d 230
• Parties: UNITED STATES of America v. Ronald W. REPAK, Appellant
• Court: U.S. Court of Appeals — Third Circuit

852 F.3d 230

UNITED STATES of America

v.Ronald W. REPAK, Appellant

No. 15-4011

United States Court of Appeals, Third Circuit.

Argued: December 19, 2016

Filed: March 28, 2017

Rebecca R. Haywood, Esq., Laura S. Irwin, Esq., [ARGUED], 700 Grant Street, Suite 4000, Pittsburgh, PA 15219, Counsel for Appellee

Timothy J. Lyon, Esq., [ARGUED], Suite 1801, 310 Grant Street, Pittsburgh, PA 15219, Counsel for Appellant

Before: SMITH, Chief Judge, MCKEE, and SHWARTZ, Circuit Judges

OPINION

SMITH, Chief Judge

Ronald Repak was convicted of two counts of Hobbs Act extortion, in violation of 18 U.S.C. § 1951, and two counts of federal program bribery, in violation of 18 U.S.C. § 666. Repak appeals his conviction and sentence on those counts. For the reasons stated below, we will affirm.

I

This is a public corruption case coming out of Johnstown, Pennsylvania. The defendant, Ronald Repak, was the Executive Director of the Johnstown Redevelopment Authority ("JRA"), which receives federal and state funding to assist in economic development for the City of Johnstown. A voluntary Board of Directors governs the JRA. To promote economic development in Johnstown, the JRA's Board of Directors awards contracts to remediate industrial proprieties and issues grants to attract companies to Johnstown.

While the JRA's Board of Directors ultimately confers contracts and grants, the JRA's Executive Director, who runs the day-to-day operations of the organization, makes recommendations to the Board as to which contractors should receive those contracts and grants. The JRA's Board of Directors "relied on the director to keep [them] informed as to what was going on." JA263. As one JRA Board member testified, "95 percent of what any board member [knew] in most ... situations ... w[as] told [to them] by the director." JA262–63. In short, the Executive Director plays a vital role in the process of selecting who receives JRA contracts and grants.

Repak was the Executive Director from November 1977 to February 2013. His assistant was Debbie Walter. With Walter's help, Repak solicited a number of items from contractors who had been awarded contract work by the JRA during his time as Executive Director.¹ Repak's solicitations included requests for concert tickets, sporting event tickets, and golf outings. JRA contractors acquiesced in Repak's solicitations because "if [they] didn't, [they] felt that [they] would lose work." JA284. As one contractor testified, Repak "would sometimes ... provide some innuendos like, ‘Hey, I'm reviewing some invoice here of yours,’ which [was] usually followed up with some type of request. Or sometimes, [he would say,] ‘Well, I can get someone else to do the work.’ " Id. ; see also JA301 ("Mr. Repak provided a lot of, I said innuendos, subtle things through conversations. And then it would always be followed in a short period of time by either an instruction or request.... [W]ith him [,] [instructions and requests] were the same thing.").

Of particular importance in this appeal are two items that Repak received from JRA contractors but that were unassociated with any JRA project: a new roof on his house and excavating services for his son's gym. The Government also charged Repak with receipt of Pittsburgh Steelers tickets from another contractor, Kimball & Co. The jury, however, acquitted Repak on the counts related to receipt of the Steelers tickets. For that reason, we discuss only the receipt of the roof and excavating services in detail.

In 2009, JRA contractor EADS Group ("EADS") replaced the roof on Repak's home at no cost to Repak. While Repak and several EADS employees were together, Repak overheard an EADS employee, Stephen Sewalk, discussing his past roofing business. Repak then asked Sewalk to take a look at the roof on his home. At that time, EADS did significant business with the JRA. Based on Repak's past solicitations for tickets and other items, Sewalk stated that he "inward[ly] sigh[ed]" following Repak's roof request and thought "here we go [again]." JA286. Although Sewalk initially tried to ignore Repak's request, Sewalk "knew it wasn't going to go away" after Repak made the request again several months later. Id. Sewalk then went to look at Repak's roof but testified at trial that he did not give Repak a quote for work on the roof. Rather, after Sewalk spoke with EADS's CEO, EADS "figured [the roof] was going to be another ... favor" and informed Repak that it would cover the cost of replacing his roof. JA287. Sewalk testified that, although Repak offered to pay for the roof at one point, Repak also told him to "bury [the roofing expenses] in an invoice" to the JRA. JA288. EADS ultimately replaced the roof at a cost of $3,000 to $4,000. Instead of concealing those expenses in JRA invoices as Repak instructed, EADS simply bore the cost of replacing the roof. When asked at trial why EADS did this for Repak, Sewalk responded that EADS replaced the roof simply so that EADS could "maintain the workload" with the JRA. Id. ; see also JA289 ("[W]e wanted to keep people employed and do our work. So I figured if we told [Repak] no that we weren't going to be working there much longer.").

Also in 2009, a JRA contractor performed excavating services at a gym owned by Repak's son. Neither Repak nor his family paid for it. Repak initially asked another JRA contractor to do the excavating work, but, after Repak told the contractor to bury $5,000 out of the $6,000 excavating price quoted in a JRA invoice, the contractor turned him down and refused to work for the JRA again. As that contractor put it, "I just discussed it with my wife and kids, ... and we just decided it would be better just to walk away [than continue to work for the JRA and Repak]." JA359.

Repak then enlisted another JRA contractor, L&M Excavating Company ("L&M"), to do the work. Repak instructed L&M to demolish two abandoned homes and level lots adjoining his son's gym and then to spread gravel on the leveled area for parking. This work cost L&M $17,500. After completing the requested work, an L&M employee, Rick McNulty, asked Repak whom L&M should invoice for the work. Repak told McNulty to "just bury [the $17,500] in invoices" to the JRA and did not offer to pay for L&M's services. JA325–26. At that time, sixty percent of L&M's business came from the JRA. Yet, rather than follow Repak's instruction to submit fraudulent invoices, L&M assumed the $17,500 cost to level and gravel the property near the gym. When asked why L&M did this, McNulty explained that providing these gratuitous services to Repak was just "part of doing business with the [JRA] and Mr. Repak." JA311.

As members became suspicious of Repak's dealings with JRA contractors, the JRA's Board of Directors implemented policies to control gratuities and expenditures. The gratuities policy prohibited JRA contractors from offering any gratuity to any JRA employee and prohibited JRA employees from accepting the same. The expenditures policy required the approval of the JRA's Board of Directors for all JRA expenditures over $500. At trial, JRA contractors expressed the relief they felt following enactment of the gratuities policy. One JRA contractor testified, "I was relieved [because] ... it gave me my ammunition to say no, I guess. I didn't have to continue doing this." JA290. Echoing the sentiment behind the JRA policies, another contractor opined, "It had to stop. It was getting to the point that [Repak] was like one power running everything in the city of Johnstown and if ... this wasn't the way you would choose to do business, you wouldn't do business here." JA330.

II

A grand jury returned a six-count indictment against Repak arising out of his actions as the Executive Director of the JRA. The six counts related to three underlying factual circumstances: Counts 1 and 2 pertained to Repak's receipt of Pittsburgh Steelers tickets from Kimball & Co.; Counts 3 and 4 dealt with the installation of a new roof on Repak's house by EADS; and Counts 5 and 6 related to the excavation services performed by L&M at Repak's son's gym. Counts 1, 3, and 5 charged Repak with violations of the Hobbs Act, 18 U.S.C. § 1951(a), for knowing obstruction, delay, or effect on commerce "by extortion" through the solicitation and receipt of goods and services, "which were not due him or his office, and to which he was not entitled, ... in exchange for [his] official action and influence as the Executive Director of the [JRA] to facilitate the award of [JRA] contracting work." JA55, JA57, JA59. Counts 2, 4, and 6 charged Repak with violations of the federal program bribery statute, 18 U.S.C. § 666(a)(1)(B), alleging that he "did corruptly solicit, demand, accept, and agree to accept something of value, intending to be influenced and rewarded in connection with [JRA business]," specifically that Repak respectively "solicited and obtained" goods and services "in exchange for his official actions and influence as the Executive Director of the [JRA]." JA56, JA58, JA60.

Before trial, the District Court decided two motions in limine filed by the Government that were relevant to Repak's appeal. First, Repak challenged the admission of evidence of solicitations and items he received beyond those items charged in the indictment ("other-acts evidence"). The District Court allowed the Government to introduce the other-acts evidence, determining that the evidence was admissible to prove Repak's mental state for the charged offenses. See United States v. Repak , No. 3–14–cr–00001, 2015 WL 4108309, at *4–6 (W.D. Pa. July 7, 2015). Second, Repak challenged the admission of evidence of an affair he had with Walter under Rule 403 of the Federal Rules of Evidence. Following briefing on the issue, the District Court permitted admission of the affair evidence, concluding the affair was relevant to Repak's mental state and would further assist the jury in assessing Walter's credibility when she testified. See JA11–17.

At trial, the parties jointly...