US v. Gotti

• Decision Date: 01 August 1991
• Docket Number: No. CR-90-1051.,CR-90-1051.
• Parties: UNITED STATES of America, Plaintiff, v. John GOTTI, et al., Defendants.
• Court: U.S. District Court — Eastern District of New York

771 F. Supp. 552

UNITED STATES of America, Plaintiff, v. John GOTTI, et al., Defendants.

No. CR-90-1051.

United States District Court, E.D. New York.

August 1, 1991.

John Gleeson, Asst. U.S. Atty., Brooklyn, N.Y., for plaintiff.

Samuel H. Dawson, Gallop, Dawson, Clayman & Rosenberg, New York City, for Bruce Cutler.

Herald Price Fahringer, New York City, for Gerald L. Shargel.

Victor J. Rocco, Gordon, Hurwitz, Butowsky, Witzen, Schlov & Wein, New York City, for John L. Pollok.

MEMORANDUM AND ORDER

GLASSER, District Judge:

The government has moved this court for an order disqualifying Gerald Shargel, Bruce Cutler and John Pollok from representing any of the defendants in this case at trial. The motion is based upon the assertion that there are several actual and numerous potential conflicts of interest to which their continued participation would give rise and that those conflicts can neither be waived nor remedied except by disqualification. The government alleges that the inevitability of their disqualification must follow from the assertions that:

1. The named attorneys are "house counsel" to the "enterprise" charged in the indictment, namely, the Gambino Organized Crime Family, and that their representation of and services to various members of that enterprise whose obligations for legal fees were paid by John Gotti will be "part of the proof of the association-infact charged in the indictment." Their presence at trial will, therefore, violate DR 5-102(A) of the American Bar Association's Code of Professional Responsibility.

2. The named attorneys, and more specifically Shargel and Cutler, were witnesses to various events of significance that will be proved at trial also requiring their disqualification from participating in the trial pursuant to DR 5-102(A).

3. Shargel and Cutler previously represented their predecessor as "house counsel," who will be an "important government witness." Pollok has also previously represented another prospective government witness. Both witnesses were represented by one or more of those attorneys during their testimony before the grand jury in this case.

4. The insinuation of their own improper conduct could inhibit their pursuit of a vigorous defense on behalf of their clients who will thus be deprived of representation by conflict free counsel.

INTRODUCTION

The superseding indictment contains thirteen counts which will be summarized briefly. The defendants are charged in Count One with violating the Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18 U.S.C. § 1962(c), unlawfully conducting and participating in the conduct of the affairs of an enterprise through a pattern of racketeering activity. The "enterprise" is alleged to be the Gambino Organized Crime Family of La Cosa Nostra. The predicate acts of racketeering are, as to one or more of the defendants, alleged to be the conspiracy to murder and the murder of Paul Castellano (John Gotti); the murder of Thomas Bilotti (John Gotti); the conspiracy to murder and the murder of Robert DiBernardo (John Gotti and Salvatore Gravano); the conspiracy to murder and the murder of Liborio Milito (John Gotti and Salvatore Gravano); the solicitation of murder of Louis DiBono (Salvatore Gravano); the conspiracy to murder and the murder of Louis DiBono (John Gotti, Frank Locascio and Salvatore Gravano); the conspiracy to murder Gaetano Vastola (John Gotti, Frank Locascio and Salvatore Gravano); illegal gambling business in New York (John Gotti, Frank Locascio and Salvatore Gravano); illegal gambling business in Connecticut (John Gotti, Frank Locascio, Salvatore Gravano and Thomas Gambino); loansharking conspiracy (John Gotti, Frank Locascio, Salvatore Gravano and Thomas Gambino); extortionate collections of credit (John Gotti, Frank Locascio, Salvatore Gravano and Thomas Gambino); obstruction of justice — the Thomas Gambino trial (John Gotti); obstruction of justice — the Castellano murder investigation (John Gotti, Frank Locascio and Salvatore Gravano). In Count Two they are charged with racketeering conspiracy and bribery as a predicate act. Counts Three through Twelve charge the substantive offenses listed in Count One as predicate acts. Count Thirteen charges John Gotti and Frank Locascio with conspiring to defraud the United States in connection with the collection of income taxes.

That indictment was the result of an extensive investigation of the named defendants and of a group of individuals alleged to be associated in fact as the Gambino Organized Crime Family of La Cosa Nostra, characterized in that document as an "enterprise" within the meaning of 18 U.S.C. §§ 1961(4) and 1959(b)(2). The investigation entailed visual surveillance of many persons and places; gathering, analyzing and appraising the value of information supplied by persons familiar with the targets of the investigation and their activities and electronic surveillance.

The electronic surveillance was conducted pursuant to the authority of orders issued in accordance with 18 U.S.C. §§ 2510-2521 by Judge Duffy of the United States District Court for the Southern District of New York on September 25, 1989. Those orders authorized the interception of oral communications and visual, non-verbal conduct of John Gotti, Jack D'Amico, Frank Locascio, Salvatore Gravano and others as yet unknown at specified locations in and about the Ravenite Social Club, 247 Mulberry Street, New York, New York and at Scorpio Marketing, 229 West 36th Street, New York, New York. Many conversations were intercepted and recorded. The defendants sought to suppress the fruits of that electronic surveillance, asserting violations of constitutional dimension, the violation of statutes and of common law principles. The briefs, affidavits, transcripts, prior decisions, orders and other assorted documents submitted by each side in support of and against the motion to suppress can fairly be described as voluminous. That motion was denied in a Memorandum and Order issued on July 19, 1991.

The motion to disqualify counsel is predicated to a very large extent upon the electronically intercepted conversations. Pending the resolution of the motion to suppress the interceptions, defense counsel urged the court not "to rush to judgment" on the disqualification motion for the reason, among others, that that motion "should not be decided before it is known whether the Title III surveillance can pass constitutional muster." (Letter from Gerald L. Shargel to the court dated March 5, 1991.) The court acceded to this urging, and having determined that the electronic surveillance does pass constitutional muster, now turns to this motion to disqualify.

STATEMENT OF FACTS

A. The Attorneys as "House Counsel" for the Enterprise

The factual bases upon which the government relies for this and the other grounds for disqualification are excerpts of intercepted conversations, the accuracy of which is not controverted in the defendants' submissions in opposition and which are set out in the Government's Memorandum in Support of its Motion for an Order Disqualifying Counsel ("Gov't Mem.") at 10-52. Those excerpts will be summarized in part and reproduced verbatim in part as is deemed appropriate.

John Gotti described the commencement of his relationship with Gerald Shargel and, after complimenting him on his legal ability, assured him that "our friends will use you." Thereafter, "two guys took him on right away" and "I brought him six." (Gov't Mem. at 10-11.)

At another time Gotti is heard to say to Gravano:

Some of them love us because we did put them on the map. I remember Gerry when Gerry was an ambulance chaser.

(Gov't Mem. at 28.)

He also described the commencement of his relationship with Bruce Cutler (Gov't Mem. at 12) who, at the time, was associated with Barry Slotnick:

Bruce, I don't know him all my life. I know him five years.... Without us he wouldn't be on the map.

(Gov't Mem. at 28.)

In a subsequent conversation between John Gotti, Salvatore Gravano and Frank Locascio, Gotti expressed displeasure at the amounts of money he was paying his lawyers, in these words:

You know these are "rats" Sam. And I gotta say, they all want their money up front. And then you get four guys that want sixty-five, seventy-five thousand apiece, up front. You're talking about three hundred thousand in one month....

I paid 135,000 for their appeal. For Joe Gallo and, and "Joe Piney's" appeal, I paid thousands of dollars to Pollok. That was not for me.

(Gov't Mem. at 13.)

Then I gave him 25,000 for Carneg's.... Johnny's a wealthy kid, thank God, and he, he don't want none of my money. But he refused to pay. So there wasn't even no appeal. What, what do we do? So, I says, "What do you mean? How much is it?" Gerry can tell you. He says, "25." "Well, you got it. Pete, bring him 15. And then, you got ten in two weeks.... The other guy's appealing. I'm paying John, I paid his 50.

(Gov't Mem. at 14.)

I gave youse 300,000 in one year. Youse didn't defend me. I wasn't even mentioned in none of these * * *¹ things. I had nothing to do with none of these * * * people.... What the * * * is your beef? ... Before youse made a court appearance, youse got 40,000, 30,000 and 25,000. That's without counting John Pollok.... You standing there in the hallway with me last night, and you're plucking me.... "Tony Lee's" lawyer but you're plucking me. I'm paying for it.... Where does it end? Gambino Crime Family? This is the Shargel, Cutler and who do you call it Crime Family.

(Gov't Mem. at 14-15.)

Later on during the course of this conversation and after dissatisfaction with their lawyers is expressed by each ("They're overpriced, overpaid and underperformed ... and they ain't got the balls to do what they gotta do." (Gov't Mem. at 15)), Gotti is heard to say:

Don't you know why they ain't got the balls, too? I told them yesterday, I told them why.... You don't get up and holler when you could because nothin'

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