Opinion
No. S2 02 Cr. 274 (GEL).
October 6, 2004
David N. Kelley, United States Attorney for the Southern District of New York (Diane Gujarati, Michael Purpura, Adam B. Siegel, Assistant United States Attorneys, of counsel), for the United States of America.
Robert A. Culp, New York, NY, for defendant Steven Madori.
OPINION AND ORDER
Defendant Stephen Madori, who was found guilty by a jury of loansharking activities, moves for a new trial pursuant to Rule 33, Fed.R.Civ.P., claiming that the Government violated its obligations under Brady v. Maryland, 373 U.S. 83 (1963), andGiglio v. United States, 405 U.S. 150 (1972), by failing to disclose certain materials relating to the relationship between the Government and a co-defendant, Charles Chiapetta. Although the motion was initially made on December 17, 2003, resolution was delayed by proceedings relating to the unsealing of various materials, and the final submission on the merits (a letter in the nature of a sur-sur-reply by defendant) was not received until July 16, 2004. The matter has now been fully briefed, and is ripe for decision. The motion will be denied.
BACKGROUND
The superseding indictment on which Steven Madori was tried consisted of four counts charging him with various loansharking offenses related to a single transaction. Specifically, Madori was charged with conspiring to make an extortionate loan, actually making such a loan, conspiring to collect the loan by extortionate means, and actually threatening a victim with physical harm in order to collect the loan, in violation of 18 U.S.C. §§ 892, 894. After hearing evidence for four days, and deliberating for approximately a day, the jury returned a verdict of guilty on all counts on February 28, 2003. On August 18, 2003, Madori was sentenced principally to concurrent terms of fifty-one months of imprisonment on all counts. Bail pending appeal was denied, and he is serving his sentence. A co-defendant, Charles Chiapetta, pled guilty to an earlier version of the indictment on December 31, 2002, and was sentenced on September 3, 2003, principally to twenty-four months in prison. He is also serving his sentence.I. The Evidence at Trial
The evidence at trial proved overwhelmingly that Madori participated in the making and collection of an extortionate loan to a businessman named Norman Meisenberg. Meisenberg testified that in 1997, he was having serious financial problems. Unable to raise money from legitimate sources, he turned to loansharks, borrowing large sums at exorbitant rates of interest. When he was unable to repay the loans, he sought yet another source of borrowing from a business associate named Jeff Troncone. (Tr. 38-47.)
Troncone told Meisenberg that he did know a source of loan money, but that it would not be a good idea to turn to that source, because the lenders were dangerous people who were "connected" to organized crime. (Tr. 47-48, 55, 282.) Desperate for cash, Meisenberg rejected this advice, and Troncone arranged to introduce him to Chiapetta, from whom Troncone had earlier borrowed money himself. (Tr. 56, 110, 276-77.)
Meisenberg met Chiapetta for the first time in approximately June or July of 1997 at a Portchester topless bar called the Diamond Club, which was owned by Madori. (Tr. 56-59, 286.) Meisenberg sought a loan of $10,000, which Chiapetta said would have cost interest of 3%, or $300, per week. (Tr. 60-61.) After hearing Meisenberg's request, Chiapetta told him that "we will get back to you in a couple of days, I have to speak to someone." (Tr. 60.) A day or so later, Chiapetta advised Meisenberg that "we can do that deal." Meisenberg returned to the Diamond Club, where Chiapetta gave him $10,000 in cash. (Tr. 61-62.) Chiapetta told Meisenberg that if he didn't pay the money back, "you are going to have a big problem," which Meisenberg understood to mean that "I would face some physical harm if I couldn't pay it back." (Tr. 63.)
A car observed at Madori's residence was registered to "Cabaret, Incorporated" at the address of the Diamond Club. (Tr. 269.)
A few weeks later, Meisenberg decided he needed an additional $5000, and sought to increase the loan. At a meeting at the Diamond Club with respect to this request, Chiapetta said, "someone wants to meet you," and took Meisenberg "into a back room in the Diamond Club and he introduced me to his associate," who turned out to be Madori. (Tr. 64.) After some small talk, Madori asked Meisenberg "Did you get your package? I said no. He said Charlie has it. He looked at me, said, do the right thing, and dismissed me." (Tr. 65.) Meisenberg received the additional $5000, and for over a year he made weekly payments of $450 in interest, which were collected in New York City either by Madori, Chiapetta, both together, or by an associate of theirs named Sal. (Tr. 64-66.) On occasion, Troncone would pick up payments that Meisenberg sent via Western Union, and drop off the money at the Diamond Club, handing it to whoever was at the door to give to "Charlie or Steve." (Tr. 287.) Eventually, he paid about $25,000, none of which was credited against the principal. Madori and Chiapetta refused to reduce the principal of the loan and insisted that Meisenberg still owed the full principal of $15,000. (Tr. 66.)
Eventually, Meisenberg encountered difficulties making payments to the various loansharks from whom he had borrowed a total of about $150,000. After his wife received a phone call in which an unknown individual threatened to kill her and her family unless Meisenberg paid $25,000 immediately, Meisenberg reported his plight to the Federal Bureau of Investigation ("FBI") on July 13, 1999. (Tr. 67-68, 71, 226.) At the direction of FBI agents, Meisenberg began to wear a recording device to various meetings at which he made payments to his creditors. (Tr. 70-72.)
The jury heard a number of these recorded conversations, corroborating Meisenberg's account of the efforts of Chiapetta and Madori to coerce him to repay the $15,000 he had borrowed. In a conversation on July 20, 1999, at the Diamond Club, when Meisenberg was four weeks behind in paying his interest, and Meisenberg could make only a partial payment, Chiapetta told Meisenberg, "when I give this to somebody, he's not going to like it one bit," and that if "[y]ou don't pay, there's a problem." Meisenberg understood this as a "threat" that "something physically could happen to me." (Tr. 81-82; GX 1.) A reasonable jury could easily have agreed that Chiapetta's profanity-laced tirades were intended to, and did, intimidate Meisenberg. (GX 1; Tr. 85.) FBI agents and other law enforcement officers surveilled the meeting, observed Meisenberg meeting with Chiapetta, and photographed them together. (Tr. 233-35, 259-61; GX 22.)
Chiapetta agreed that he would "try to convince [Madori] not to talk to you" (GX IT at 14; Tr. 92-93) in return for Meisenberg's promise to meet the following week. The next week, Meisenberg met Madori and Chiapetta at a restaurant in Manhattan, to make an additional payment. At that meeting, in Madori's presence, Chiapetta warned Meisenberg that the alternative to payment was "punishment": "You want it, you're gonna get it. You'll get punishment. We're trying to make it easy for ya, and you want punishment." (GX 2T at 6.) Madori proposed adding the overdue interest payments to the principal of the loan (id. at 4-5; Tr. 98-100), and made plain that the debt was owed to him, and that he would not have lent the money if Meisenberg had initially proposed to borrow the principal until August rather than January: "You committed to me you would bring it back in January, it's now fucking August. . . . You tell me you want to give it to me in August, then I don't give it to you." (GX 2T at 7; Tr. 100-101.) Chiapetta similarly deferred to Madori when making a proposal, noting (in Madori's presence) that what he proposed "could be overruled" by Madori. (GX 2T at 7; Tr. 101.) Meisenberg agreed to continue to make payments.
Law enforcement agents also surveilled this meeting. (Tr. 235-36, 261-62.)
Meisenberg did not make the promised payments. In an unrecorded phone conversation on August 24, when Meisenberg told Madori he did not have the money that was due the next day, Madori told him that "I am coming down anyway," which Meisenberg took as a threat because there was "only one other reason for him to come if I didn't have any money." (Tr. 108.) A few minutes later, with the recorder on, Meisenberg called Madori back, urging him not to come because "it makes me nervous," and "it's upsetting to me," to which Madori replied that "I'm pretty upset myself." A reasonable jury could easily have found implicit threats in Madori's repeated questioning about why Meisenberg would be nervous, and his concluding statements that "We'll just have a conversation . . . so we know where we are going," and that "We are not going to do this on the telephone anymore; it's about the last time you are gonna hear from me on the telephone, alright?" (GX 4, 4T.)
Madori did not come down to Manhattan. Instead, Chiapetta kept the appointment to meet Meisenberg on the street in front of Meisenberg's office. Although Meisenberg attempted to make the meeting, the two missed each other in the traffic (Tr. 111), leading Chiapetta to make a furious phone call profanely demanding that Meisenberg come to Westchester. (GX 5.) When Meisenberg did not appear, or otherwise communicate with the lenders, they turned to other tactics. Meisenberg was out of the office the next two days, and received messages that both Chiapetta and Madori had separately come to see him unannounced. (GX 10T at 12.) Madori and Chiapetta also visited Troncone.
Troncone, a businessman with a prior conviction for mail fraud, had first met Chiapetta in 1986, when he borrowed money from Chiapetta and one Tony Baker. (Tr. 276-78.) At Meisenberg's request, Troncone had called Chiapetta to see if Chiapetta could arrange a loan for Meisenberg. Troncone vouched for Meisenberg as a friend who could afford to make the payments. (Tr. 284.) Because he had made the introduction, Troncone was advised that he had a responsibility for making sure that Meisenberg repaid the loan. (Tr. 288.) Troncone later . . borrowed $7000 himself, at the same 3% per week rate. Chiapetta gave him the money, saying it was from "the club"; when Troncone made payments at the Diamond Club, as when he delivered payments from Meisenberg, he left the money "for Steve or Charlie." (Tr. 288-91.)
In late August 1999, Madori and Chiapetta visited Troncone at his office in Connecticut. They showed up unannounced, and Chiapetta asked Troncone to go in the back room to speak privately. Both Madori and Chiapetta were "very visibly upset," because they thought Meisenberg either had contacted or was going to contact the government. They told Troncone that they had not heard from Meisenberg, and "encouraged" or "instructed" him to contact Meisenberg and "get him to call as soon as possible." At the end of the conversation, which was "very lively" and "[r]elatively gruff," Madori "made it very clear to me that he wasn't going to hold me responsible for the money, but he was holding me responsible for . . . Norman running to the government." (Tr. 295-97.)
On September 2, 1999, Troncone called Meisenberg; Meisenberg recorded the conversation. (Tr. 298-300, 118-21; GX 10.) Troncone questioned Meisenberg as to why he was not in communication with "our friends," because "that kind of upsets everybody." (GX 10T at 3.) He told Meisenberg that Madori and Chiapetta had told him that he was no longer "responsible" for Meisenberg's failure to pay, and that "their reasoning" is that "it makes it worse for you that I'm not responsible." (Id. at 14-15; Tr. 303-04.) Troncone told Meisenberg, "you gotta call [Madori] . . . [be]cause the phraseology wasn't . . . it, it wasn't thrilling yesterday." (GX 10T at 16.) Troncone advised Meisenberg "as [a] friend," that he should "[g]et some money together and bring it up there. I don't care where you get it from. . . . You gotta get this out of the way." (Id.) They agreed that Meisenberg's feeling that he would not call because Chiapetta had insulted him would be "irrelevant" to Madori. (Id.) They agreed as well that Chiapetta was a "gofer" who "overdoes it," especially when Madori is around, and concluded that it would be bad if Madori were "upset." (Id. at 17; Tr. 125.) Meisenberg noted that Madori "frightens me." (GX 10T at 16; Tr. 124-25.) Troncone emphasized that Madori "was upset yesterday." (GX 10T at 26.)
Meisenberg did indeed meet one last time with Madori and Chiapetta, at a Manhattan restaurant, on September 8, 1999, "[t]o discuss how I was going to repay them." (Tr. 126.) After initially telling Meisenberg that the problem was that he had not been in touch ("We could have talked about it maybe . . . At the end of the first week [of arrears] you have to talk to us. . . . we can't keep calling and coming by your office . . . you know our problem. It's not gonna go away.") (GX 6T at 4), Madori became more emphatic: "Norman you're out of time. Your time is up. I want that money back. . . . I want the money back. . . . Like yesterday. . . . Go to your wife, go to your son, go to your uncle your mother, I don't care who you go to, I want my money. I ain't asking you either, I'm telling you. You can't put us on the pay no mind list for five fucking weeks." (Id. at 5.) Meisenberg promised to pay in two weeks. Madori's parting words were chilling: "I hope you're not just buying yourself two more weeks of time Norman. Because, because you're in the fucking red zone now. You got my nuts real twisted by jerking us off for five weeks. Because it becomes a non-money issue now it becomes a principle issue and that's when you go into the danger zone, when it becomes principle instead of money." (Id. at 10.) Meisenberg took Madori's statements to mean "either bring back the money or else . . . I'm going to get hurt." (Tr. 127.) A reasonable jury could easily have concluded that he was correct.
FBI agents surveilled this meeting as well, and photographed Madori and Chiapetta arriving together at the restaurant. (Tr. 236-38, 262-63; GX 30-33.)
Meisenberg called Madori one last time, to arrange a meeting to make the promised. . payment two weeks later, on September 24. (GX 7.) At the direction of the FBI, he did not make the meeting. (Tr. 134.) Instead, the FBI went to serve a subpoena on Madori. (Tr. 240.) Later, Madori and Chiapetta were arrested. (Tr. 337-40.)
Madori did not testify or present any evidence. In closing argument, Madori's attorney argued that the Government had failed to prove beyond a reasonable doubt that there was ever a threat of physical force (Tr. 402), vigorously attacking the credibility of Meisenberg and Troncone as con artists trying to get out of repaying a legitimate if "unconventional" loan (Tr. 407), by falsely claiming to have been put in fear. Madori never contested that he had made the loan, or that he had acted jointly with Chiapetta.
II. Chiapetta's Pre-Trial Motion
As noted above, Charles Chiapetta pled guilty in advance of trial. That plea, however, was preceded by an unusual motion. On November 12, 2004, without notice to Madori, Chiapetta moved to sever his trial from Madori's.
The documents and proceedings described in this section of the Opinion were not contemporaneously made known to Madori. Upon Madori's new trial motion, at Madori's request, the Court ordered that copies of all relevant documents and transcripts, redacted with respect to the details of Chiapetta's former cooperation not relevant to this case, be publicly filed and provided to Madori, and that unredacted copies be filed under seal for purposes of potential appellate review. See Order of May 4, 2004.
In an affidavit accompanying the motion, Chiapetta asserted that Madori was connected to organized crime. (Chiapetta 11/12/02 Aff. ¶ 2.) He claimed that at the time of the events alleged in the indictment, he was a confidential informant, who had received leniency when sentenced in December 1999 in a prior case in the Eastern District of New York due to a Government motion pursuant to U.S.S.G. § 5K1.1. (Id. ¶¶ 3, 4.) Chiapetta did not assert in the affidavit that he had committed any of the acts charged in this indictment at the Government's behest or with the Government's permission. Rather, he argued that his defense at trial would be that he undertook to assist Madori in committing the acts charged due to "the circumstances of [his] cooperation, those relationships [with organized crime figures] from which I could not extricate myself, and the belief that, if I did not assist Madori, I myself could be found out and would be in danger." (Id. ¶ 5.) He stated, however, that he could not present this defense at a joint trial, or at a trial that preceded Madori, for fear that Madori, and through him other organized crime figures, would learn of his involvement with the Government. (Id. ¶¶ 6, 7.)
Chiapetta's claim was laid out in slightly more detail in a memorandum of law accompanying the motion. In the memorandum, Chiapetta argued that the motion needed to be made ex parte with respect to Madori, and that his trial would have to be severed from Madori's, for fear that a description of his activities as a cooperator would put him in danger from organized crime figures "even assuming that his codefendant would not personally harm him, a circumstance on which he does not speculate." (Chiapetta Mem. 2.) Chiapetta further contended that if he were tried before Madori, he would be "expose[d]" to Madori, and the Government might even seek to use his testimony, which, he emphasized "would not be helpful to Madori," against his co-defendant. (Id. 3.)
In response to this motion, the Government scoffed at Chiapetta's "unsupported belief that his cooperation would have been discovered if he refused to participate in the crimes charged" in the indictment. (Govt. Mem. 3.) Noting that Chiapetta did not "claim that the loansharking activities charged in the Indictment were in fact part of [his] alleged cooperation" (id.), and claimed only that "he was required to commit the crimes charged in the Indictment so as not to lose credibility with Madori" (id. 11), the Government attached an internal FBI memorandum dated May 29, 1998, written by FBI Special Agent Jeffrey Rasey, who at that time was supervising Chiapetta's cooperation. The memo stated that Chiapetta had advised the agent that "Steve Midori [ sic] [had] requested [Chiapetta] to put out some money on the street in Stamford, CT on behalf of [another individual]," and that Chiapetta had "requested authority to do so." The agent asked Chiapetta if he would agree to testify about any such activity, and Chiapetta declined. Under those circumstances, the agent "advised [Chiapetta] that no authority to make loan shark loans in Connecticut would be given without agreement to testify." When Chiapetta was asked what would happen if the borrowers had trouble repaying the loans, Chiapetta "responded that he would `have to do something.'" The agent emphasized again that he "had no authority from the government to collect money on the loan shark loans without agreeing to testify." When Chiapetta again stated that he "could not testify," the agent "advised [Chiapetta] that [he] had no authority from the government for this activity and [Chiapetta] acknowledged this." (Govt. Mem. Ex. A ("Rasey Memo").)
Based on this memorandum, the Government argued that the purported defense that was the basis of the severance motion was no defense at all, because as the record made clear, and as Chiapetta effectively acknowledged, even if he was informing the Government about other matters at the time of the events charged, he could claim no authority defense for any illegal activity in which he engaged. He had been specifically advised that because he had not agreed to cooperate fully, including testifying openly if that were required, he would not be working for the FBI if he became involved in Madori's loansharking activities. (Govt. Mem. 10-11.)
On December 16, 2002, the Court heard argument from Chiapetta's counsel concerning his motion. Essentially, Chiapetta argued that when he was approached by Madori to engage in loansharking in Connecticut, while providing information to the Government about organized crime figures, "he was then put in a situation where he either had to disengage himself . . . without explanation and risk his cooperation agreement, or he had to appear to go along." (12/16/02 Tr. 7.) When the Court responded that that would not be a defense in any event (id.), Chiapetta argued that his defense was "a mix of lack of intent and duress in formulating what his conduct had to be so that he had to protect himself." (Id. 12.) The proceeding principally consisted of legal argument concerning whether the proposed defense would be legally viable, and whether, assuming such a defense could be presented as a matter of law, the remedy of severance and a later trial was a realistic solution to Chiapetta's professed concern for his safety if the defense were advanced at a joint trial. Other than Chiapetta's acknowledgment that he had not reported to the FBI any facts about "this particular victim," but merely a general "scheme . . . to put money out on the street," (id. 12), the proceeding added little to the factual record. At the conclusion of the hearing, the Court denied the motion, holding that Chiapetta's purported defense would fail as a matter of law, and that even if it were legally valid, a severance would not as a practical matter protect Chiapetta from retaliation any better than a joint trial. (12/16/02 Tr. 34-42.)
Chiapetta subsequently pled guilty to collecting a debt by extortionate means and conspiring to do so, and committing such offenses while on bail release. (12/31/02 Tr. 1-14.)
III. The Government's Brady Application
Shortly thereafter, the Government sent the Court a short ex parte letter, disclosing that it intended to offer statements by Chiapetta at Madori's impending trial as statements by a co-conspirator in furtherance of a conspiracy with Madori, and seeking an ex parte protective order authorizing it to withhold from Madori evidence of Chiapetta's former cooperation with the Government. (Letter from AUSAs Adam B. Siegel and Diane Gujarati to the Court, dated January 6, 2003 ("Ex Parte Application")). The Government argued that it did not "view the fact of Chiapetta's cooperation . . . as having any impeachment value," noting that "Chiapetta received no benefit from the Government for participating in loansharking activity with Madori," and had "kept his illegal activities with Madori hidden from the Government" after being advised that he was not authorized to engage in such activities. (Ex Parte Application at 2.) The Government asked the Court to "so order" the letter, and in the alternative, if the Court disagreed with its analysis, sought "an opportunity to further address the issue prior to such time as any disclosure to Madori is required." (Id.)
Immediately upon receiving the letter, the Court convened "an unusual ex parte sealed proceeding" to hear further argument from the Government. (1/8/03 Tr. 2.) The Court opened the proceeding by presenting the issue as follows:
The basic problem is that Chiapetta served as a government informant at certain points in the past and, in fact, was awaiting sentence in another case in which he had a cooperation agreement and eventually received a 5K1 departure when these crimes took place.
On the other hand, the government contends and Chiapetta did not dispute in prior proceedings in this case that he was instructed not to participate in this crime that's charged against Mr. Madori and that he did so without the government's knowledge or consent. There is, moreover, reason to believe that exposing Chiapetta's past cooperation would put his life in danger.
(Id.) Noting that the Government intended to introduce statements by Chiapetta against Madori, that impeachment material about Chiapetta might accordingly be disclosable to the defense under Brady and Giglio, and that the government argued "that Chiapetta's informant status is not impeaching since he was not working for the government at the time and had no motive to please the government," the Court declined "simply to endorse [the Government's] proposed protective order," but rather had convened the instant proceeding "both [to] make a clearer record and [to] explore some of these issues with the government before ruling." (Id. 3.)
Initially, the Court clarified that the Government was not arguing that, if the information in question was materially impeaching, the Government could nevertheless withhold it in order to protect Chiapetta. (Id. 4-5.) The Court then sought the Government's view as to several theories on which the information in question could be considered exculpatory, noting the difficulty of making "a blanket pretrial determination that material is not exculpatory or impeaching" without knowing what the evidence at trial is actually going to be. (Id. 5.)
Indeed, as the Court pointed out, it was not even clear what if any statements by Chiapetta that the Government might offer would constitute "assertions" within the meaning of the hearsay prohibition that would therefore be subject to impeachment if introduced as co-conspirator declarations. (1/8/03 Tr. 5-6.) One item of evidence that would clearly have been subject to such impeachment if offered under an exception to the hearsay rule was Chiapetta's guilty plea allocution, which the Government initially sought to offer as a statement against penal interest. (Ex Parte Application at 1 n. 1.) The admission of such evidence, which this Court has always found of little probative value in any case, has since been held by the Supreme Court to violate the Constitution's Confrontation Clause.Crawford v. Washington, 124 S.Ct. 1354, 1374 (2004). Although the Court urged it to reconsider the question (1/8/03 Tr. 15), the Government continued to press for its admission. The Court, however, excluded the allocution from evidence in a pretrial ruling (2/24/03 Tr. 8-9), rendering further discussion of that issue moot.
First, noting that many statements of Chiapetta on the tapes would likely not be hearsay at all, the Court addressed the theory that if Chiapetta had made statements to the victim attributing actions or statements to Madori, Madori could use the fact that Chiapetta had been an informant to argue that, "expecting that if these things did come to light he would be prosecuted, but being familiar with the government's interest in cooperation, [Chiapetta] would have a sort of incentive to build up Madori's role at the expense of his own role." (Id. 6.) The Government disputed this possibility, arguing that since Chiapetta never did try to cooperate in this case, the additional impeachment value of his former cooperation would not be material. (Id. 7.) The Court noted that in a post-trial Brady motion, it would be better placed to decide whether the information was or was not material. (Id. 8-9.)
"If what Mr. Chiapetta says on the tape is something lie, "Pay up or I'll kill you" to the victim, I don't think there's any issue of impeachment at all, because what he is saying is not hearsay. It's not an assertion. It's not something whose credibility is at issue. It's a verbal act." (Id. 5.) See Fed.R.Evid. 801 etc. (defining hearsay as "a statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted").
Second, the Court suggested that in addition to the impeachment arguments raised by the Government, Madori could argue that the information was directly exculpatory, on the theory that "there is no conspiracy because there's nobody else for him to have conspired with but someone who was working for the government." (Id. 9.) The Court noted that this argument would be unlikely to succeed because Chiapetta pled guilty to the conspiracy and agreed that he was not an agent for the Government in connection with this matter. (Id. 10.)
Third, the Court suggested that the information could be exculpatory because it could support a possible defense of entrapment, if Madori argued that Chiapetta had instigated the plot and persuaded Madori to become involved (Id. 10-11.) The Government argued that such a defense would be doomed in light of strong evidence of Madori's predisposition. (Id. 11.)
Finally, the Court raised the question of whether any ruling made in the pre-trial context would necessarily have to be subject to revision during the trial, depending on the evidence introduced and the defenses raised. The Government agreed that events at trial might lead to a revisiting of the issues, but urged that it, and Chiapetta, be given an opportunity to address the issue ex parte before the Court concluded that trial developments required that disclosure be made to Madori. (Id. 12-14.)
At the conclusion of the proceeding, the Court urged the Government to re-evaluate its case with a view to minimizing evidence or arguments that would make Chiapetta's credibility a significant issue in the case. (Id. 14-15.) The Court then ruled that on the limited record before it, there was insufficient basis for the Court to order the Government to turn over the material pre-trial, even on the assumption that it had the power to do that, see United States v. Coppa, 267 F.3d 132, 145 (2d Cir. 2001) (holding district court exceeded its discretion in ordering pretrial disclosure of all impeachment evidence without sufficient consideration of its materiality). (1/8/03 Tr. 15.) At the same time, the Court declined to sign the Government's proposed protective order, finding it "inappropriate to give a kind of ex ante blessing to the government's proposed course of action." (Id. 16.) Reverting to a theme that pervaded the proceeding, the Court pointed out that as the Brady case law had developed, the critical issue in connection with potentially exculpatory information is whether its withholding denies the defendant a fair trial, a matter which "can only be finally decided after the fact." (Id.)
IV. Chiapetta's Sentencing
The issue of Chiapetta's cooperation came up once more in the course of the proceedings on this indictment. As Chiapetta's sentencing approached, his counsel wrote the Court seeking a sentence of home detention, which would represent a substantial departure from the presumptive guideline sentence, based on a combination of circumstances, including not only his age and health and family circumstances, but also a constellation of issues predicated upon his former cooperation, including the mitigating circumstances of quasi duress and lack of intent that he had raised in his severance motion. (Letter from Frederick H. Cohn to the Court, dated June 9, 2003.) Because of the risk of danger to Chiapetta from disclosure of his cooperation, the Court agreed to seal, at defendant's request, a pre-sentence hearing at which this departure argument was addressed. (8/22/03 Tr. 3-4, 45.)
At that hearing, a retired FBI Special Agent, Joseph Sheridan, testified that he had supervised Chiapetta as an informant from the commencement of his cooperation until his retirement in January 1997. He described at some length the information unrelated to this case that Chiapetta had provided, but noted that upon his retirement, he turned Chiapetta over to Agent Rasey and had no further contact with Chiapetta or with Agent Rasey relating to Chiapetta. (Id. 15-19.) Chiapetta then argued that his guilt should be mitigated because he participated in the crime under great psychological pressure. Essentially, he argued that when approached to engage in loansharking activities with Madori, he reported that approach to the FBI, but was not authorized to proceed unless he were to do so not as a background informant, but as a full cooperator prepared to testify. Thus, confronted with a choice of cooperating fully, which he regarded as too dangerous, or declining further involvement with individuals he viewed as organized crime figures, which he regarded as equally dangerous, he decided to "temporize" by continuing to participate, in what he argued was a minor role, in the loansharking project. While acknowledging that he could not establish a true duress defense, Chiapetta essentially argued that the people he was dealing with, including Madori, were "scary guys," and that this should be taken into account to reduce his sentence. (Id. 21-24.)
After hearing argument from the Government, the Court ruled on the departure request insofar as it turned on claims relating to his former cooperation. The Court completely rejected any such departure. First, the Court ruled that the "evidence does not support Mr. Chiapetta's contention that he was merely trying to warn Meisenberg about Madori's potential for violence, rather than to threaten him . . . to extort payment of the loan." Rather, the Court found, Chiapetta's actions were "entirely indistinguishable from the behavior of any other loan shark or enforcer [who] tries to extort payment from a victim." (Id. 34.) Second, the Court concluded that the evidence did not "support the claim that Chiapetta was under some form of duress from Madori or that he had any authority or color of authority from the FBI to engage in this crime." (Id. 36.) Third, the Court rejected the claim that Chiapetta deserved a departure for voluntarily disclosing the crime. The Court noted that Chiapetta had merely disclosed to the FBI "that Madori was involved in loan sharking and wanted Chiapetta to join him." Rather than providing assistance in investigating this crime by agreeing to cooperate and testify, he "involved himself in the crime without either operating at the agent's direction or providing the FBI with any details of the offense that would have allowed law enforcement to frustrate the crime. Instead, it's undisputed that the agents never would have learned of this specific crime [the extortionate loans to Meisenberg] or of any particular loan activities by Madori that were concrete and prosecutable if Meisenberg had not reported his victimization." (Id. 38-39.)
Ultimately, finding that Chiapetta was simply "someone who is trying to play both ends[, t]rying to gain FBI cover for his criminal activities," the Court emphatically "reject[ed] any argument that Mr. Chiapetta is entitled to a departure or to any reduction in his guideline calculations on the basis of his involvement with law enforcement." (Id. 40.)
At the same proceeding, the Court also rejected the Government's contention that Chiapetta's sentence should be enhanced based on alleged perjury in connection with the affidavit submitted in connection with the severance motion, finding insufficient evidence that any of the statements were intentionally false. (Id. 40-43.)
The proceeding was then adjourned, and on September 3, 2003, in an unsealed, public proceeding, the Court sentenced Chiapetta principally to twenty-four months in prison. The sentence represented a downward departure on grounds of Chiapetta's health and family circumstances, based on facts not relevant here. (9/3/03 Tr. 23-27.)
V. The Present Motion
After the trial, as the Court had predicted, Madori moved for a new trial and sought unsealing of the various sealed materials relating to Chiapetta. By Order of May 4, 2004, the Court ordered the Government to publicly file, and to serve on counsel for Madori, copies of all sealed records, redacted to remove references to the details of Chiapetta's cooperation against other individuals. Madori argued that he had been denied "classic exculpatory impeachment information concerning the relationship between the government and Chiapetta," whom he characterized as "for all intents and purposes a critical witness and a key player whose out-of-court statements were used to convict Madori." (D. Mem. 9; see also D. Reply Mem. 3.) Madori argues that the undisclosed materials were materially exculpatory in three ways, essentially those raised by the Court in connection with the Government's ex parte application. First, he repeatedly emphasizes, as if Chiapetta had testified as a witness against Madori, that Chiapetta's cooperation agreement gave him "an incentive . . . to incriminate Madori," and thus could serve to impeach Chiapetta's credibility. (D. Reply Mem. 6.) Second, Madori claims that "Chiapetta went to great lengths to undertake the transaction in the first place," having "emphatically and continuously implored Madori to enter into the loan transaction which at first Madori resisted and had no intention of undertaking," and that the withheld materials would thus further a potential entrapment defense. (Id. 13.) Third, Madori argues that he was deprived of the opportunity to argue that Chiapetta was not a co-conspirator at all. (Id. 14.)
Madori also claims, albeit without much detail or explanation of the relevance to a new trial motion, that the various sealed proceedings affected such proceedings as his sentencing and motion for bail pending appeal. (Id. 15-16.)
DISCUSSION
I. Motion for a New Trial
The standard for new trial motions involving the withholding ofBrady and Giglio material is well established. A defendant is entitled to a new trial when "the Government's failure to disclose evidence that is materially favorable to the defense violates due process." United States v. Rivas, 377 F.3d 195, 199 (2d Cir. 2004). "There are three components of a true Brady violation: The evidence at issue must be favorable to the accused, either because it is exculpatory, or because it is impeaching; that evidence must have been suppressed by the State, either willfully or inadvertently; and prejudice must have ensued." Strickler v. Greene, 527 U.S. 263, 281-82 (1999). Materiality, or prejudice, is established "only if there is a reasonable probability that, had the evidence been disclosed to the defense, the result of the proceeding would have been different," United States v. Bagley, 473 U.S. 667, 682 (1985), or would have "put the whole case in such a different light as to undermine confidence in the verdict," Kyles v. Whitley, 514 U.S. 419, 434-35 (1995).
Two of these three components are clearly met here. First, there is no doubt that the material in question was deliberately withheld by the Government; the prosecutors made clear to the Court in advance their intent to withhold it. This was clearly done without any illegitimate motive to prejudice Madori; the Government sought permission to withhold the information in order to protect Chiapetta's safety and to safeguard the details of unrelated criminal investigations in which he participated. But the purity of the Government's motives is irrelevant to the merits of Madori's motion. The withholding of evidence, "either wilfully or inadvertently," satisfies this element of the Brady test. Strickler, 527 U.S. at 282. Whether or not there may be extreme circumstances in which pressing governmental interests justify the withholding even of Brady material, see United States v. Moussaoui, ___ F. 3d ___, 2004 WL 2029733, at *12-*13 (4th Cir. Sept. 13, 2004) (recounting Government's argument that national security concerns might justify withholding material evidence in prosecution of alleged September 11th co-conspirator), ordinarily "the defendant's right to a trial that comports with the Fifth and Sixth Amendments prevails over the governmental privilege." Id. at *16. No such extreme circumstances are even arguably present here. The Government acknowledged before trial that it did not claim that material that meets the Brady standard, that is, material whose non-disclosure would deny Madori a fair trial, could nevertheless be withheld in order to protect Chiapetta. (1/8/03 Tr. 4-5.)
In a sur-reply brief, the Government argues that the fact that Chiapetta was an informant was available to Madori, and therefore was not withheld from him, because the transcript of Madori's 1999 sentencing in the Eastern District of New York, which made clear that he had received a departure pursuant to U.S.S.G. § 5K1.1, was not sealed. In support of this argument, the Government cites cases to the effect that a Brady motion cannot succeed "if the defendant either knew . . . or should have known . . . of the essential facts permitting him to take advantage of any exculpatory evidence." United States v. LeRoy, 687 F.2d 610, 618 (2d Cir. 1982) (internal citations omitted). (Govt. Sur-reply 2-5.) The argument is, to say the least, unpersuasive. The Government made determined efforts in this case to keep Madori from finding out about Chiapetta's informant status, including seeking ex parte proceedings with the Court and agreeing to Chiapetta's demands for such proceedings, all on the representation that such steps were necessary to protect Chiapetta's safety and the confidential nature of his status. Now the Government blithely advises that these precautions were unnecessary, and that Madori should be considered to have been on notice of these allegedly highly confidential facts, because an unsealed sentencing transcript in an unrelated matter let the cat out of the bag — a transcript that, the Government represents, no prosecutor in the Southern District knew existed, since the prosecutors in this case "assumed" that the Eastern District transcript was sealed. (Id. 4 n. 1.). If it is all right for the Government to "assume" without checking that a transcript is sealed before seeking ex parte proceedings predicated on the claim that facts revealed in that transcript have thus far been protected, it must be equally all right for a defense lawyer to "assume" that the transcript of a co-defendant's prior sentencing contains nothing exculpatory, particularly when the Government discloses other Brady material to the defense. Madori correctly characterizes this argument as "gamesmanship." (Letter from Robert A. Culp to the Court, dated July 15, 2004, at 2.)
Second, although it is a closer question, there is little doubt that the withheld material is, in a broad sense, exculpatory, that is, that it would be of some arguable use to the defense in casting doubt upon Madori's guilt. Madori has set forth three theories on which the fact of Chiapetta's former cooperation could be of use to the defense: "impeaching" Chiapetta by putting Chiapetta's participation in the case in a different light, providing the basis for an entrapment defense, and undermining the claim that Chiapetta was a co-conspirator. As will be seen, these theories are in various ways dubious or unpersuasive, but the weaknesses of Madori's claims are better dealt with under the third heading, materiality, rather than by splitting hairs about whether the theories are merely weak, or are so weak as not to qualify as exculpatory at all. Suffice to say, for present purposes, that the fact that Chiapetta had been a cooperator would be the sort of thing defense counsel would wish to know, because it would support potential arguments on Madori's behalf that otherwise could not be made.
The validity of Madori's motion thus depends upon whether the information in question was "material" in the sense that there is a reasonable likelihood that the disclosure of the evidence would have affected the outcome of the case or undermined confidence in the verdict. Rivas, 377 F.3d at 199. As vividly exemplified inUnited States v. Orena, 145 F.3d 551 (2d Cir. 1998), the non-disclosure of a significant actor's informant status, or of his misconduct while an informant, does not automatically meet this standard. In this case, the standard is far from met, since the evidence against Madori stems primarily from the testimony of Meisenberg and from his own chilling words captured on tape. The facts about Chiapetta's involvement with the Government might have given the defense an additional smokescreen or two with which to try to distract attention from the power of that evidence, but there is no reasonable likelihood that a reasonable jury would have reached any different conclusion.
As the summary of the trial evidence above makes painfully clear, Madori was convicted here based on his own words, and not based on any "testimony" by Chiapetta or acts of Chiapetta's attributed to him. In connection with the extortionate collection of the loan, the Government emphasized in its summation Madori's own threats to Meisenberg, recorded on tape. It was Madori himself who told Meisenberg that he was "in the fucking red zone now. . . . Because it becomes a non money issue now it becomes a principle issue and that's when you go into the danger zone, when it becomes principle instead of money." (GX 6T at 10.) The jury plainly rejected Madori's vigorous argument that this was not a real threat, and that Meisenberg was a "con artist" who did not really feel fear in connection with this effort to collect the loan. Similarly, it was Madori who threatened to "come down" to visit Meisenberg, making Meisenberg "nervous" (GX 4T at 1), and Madori who personally, in company with Chiapetta, solicited Troncone to put further pressure on Meisenberg. (Tr. 295-97.) Nothing about Chiapetta's status is remotely relevant to any effort to exculpate Madori of any of the elements of extortionate loan collection based on these actions, or could make it any more likely that Madori would be acquitted on this charge.
With respect to the making of the extortionate loan, Chiapetta played a larger part. Meisenberg first met Chiapetta, on Troncone's introduction, in order to seek his loan, and only afterwards met Madori. But that meeting was sufficient to establish Madori's role in this offense. Meisenberg testified that it was Madori who told him that "Charlie" had Meisenberg's "package" containing the loan proceeds, and told him to "do the right thing." (Tr. 65.) If there remained any doubt about whether Madori himself had participated in the making of the loan from the start, it was dispelled by later recorded conversations, in which Madori states that " I" would not have extended the loan knowing that Meisenberg would take so long to repay (GX2T at 7), and demands that Meisenberg return " my money" (GX 6T at 5.) (Emphases added.) Madori continually uses the first person, either singular or plural, in demanding that Meisenberg repay the loan. There is simply no basis on which Chiapetta's informant status could lead a reasonable jury to conclude that Madori did not personally participate in making, as well as in attempting to collect, the usurious, extortionate loan.
With that background in mind, the Court turns to Madori's specific arguments that the information withheld from him was materially exculpatory.
An understanding of the evidence against Madori completely demolishes the theory that Chiapetta's informant status was materially exculpatory because it constituted impeachment evidence in the sense defined in Giglio. Chiapetta, of course, did not testify as a witness against Madori. While Giglio material must be provided as to an out-of-court declarant whose statements are admitted against a defendant as co-conspirator hearsay, United States v. Jackson, 345 F.3d 59, 71 n. 6 (2d Cir. 2003), extremely little of the evidence at trial falls into that category. Chiapetta's words indeed featured significantly on the tapes, but virtually always as evidence simply of his own acts. Only rarely does he attribute anything, or refer explicitly to, Madori. Thus, his statements are for the most part not "assertions," and thus not evidentiary "statements" offered to prove the truth of the matter asserted, that would otherwise be hearsay. Fed.R.Evid. 801(a), (c). A "declarant" under the hearsay rule is someone "who makes a statement" in the sense defined in the rule. Fed.R.Evid. 801(b). There is thus no sense in which Chiapetta's "credibility" in the ordinary sense of the word is at issue in the case, because Madori was convicted not based on anything Chiapetta said about him, but based on what he did himself.
On the rare occasions on which Chiapetta does indicate that he has to see someone to approve the loan, or that Madori could overrule his proposal, or that Meisenberg might have to see Madori, Madori always either is present, or promptly appears to corroborate what Chiapetta had said.
Nor is it plausible that Chiapetta's status impelled him to act in a way that minimized his own involvement and pointed the finger instead at Madori. Madori repeatedly argues that Chiapetta's experience as a cooperator provided him with an incentive to "manipulate the evidence" by "minimiz[ing] his own involvement . . . at the expense of inculpating Madori." (D. Reply Mem. 11.) In theory, such an incentive could well exist, and Chiapetta no doubt hoped that, if his activities with Madori came to light, he could claim (as he did indeed claim) that he didn't really mean to be a full participant in any wrongdoing. But in practice, the record completely refutes the claim that Chiapetta manipulated his words to Meisenberg so as to appear an innocent pawn, and to attribute any menace to Madori. As the Court found in sentencing Chiapetta, Chiapetta's actions were "completely indistinguishable from the behavior of any other loan shark or enforcer [who] tries to extort payment from a victim." (8/22/03 Tr. 34.) Chiapetta in his own right was hostile, profane, and intimidating in his dealings with Meisenberg, and rarely even mentioned Madori. Conversely, Madori himself, as demonstrated above, undertook to provide all the evidence necessary to convict him out of his own mouth. The notion that any of Chiapetta's dealings with Meisenberg were constructed in such a way as to inculpate Madori is fanciful, and there is no reasonable likelihood that knowing that Chiapetta had a prior relationship with the Government would lead a jury to accept any such argument.
Madori's entrapment theory is no more persuasive. Of course, without Chiapetta's informant status, an entrapment defense would be entirely precluded, since absent that status any inducements by Chiapetta to participate in the crime could not be attributed to the Government. Thus, Chiapetta's informant status is exculpatory vis-a-vis that defense, since it provides a necessary link toward raising any such defense. However, there is nothing whatever in this record that provides any likelihood at all that an entrapment defense would succeed.
First, nothing in Chiapetta's statements, whether to the Court or to the FBI, give any support to the theory that he induced Madori to participate in any loansharking transaction. Rather, Chiapetta advised the FBI in the first instance that Madori "requested [Chiapetta] to put out some money on the street in Stamford, CT on behalf of" another individual. (Rasey.Memo at 1.) This statement was made in May 1998, apparently before Meisenberg, who borrowed from Madori and Chiapetta in July 1998, was on the scene, and referred to a locale, Stamford, to which, so far as the record in this case indicates, Meisenberg had no connection. Moreover, Chiapetta's consistent position in his motion and sentencing arguments in this case was that he was recruited by Madori and others of whom he was afraid to participate in this loansharking enterprise. (Chiapetta 11/12/02 Aff. ¶¶ 5-7; 8/22/03 Tr. 21-24.) Thus, the record remains devoid of any evidence whatsoever of any Government inducement to Madori to participate in the transactions in question.
Notably, Madori's motion is unaccompanied by any affidavit from Madori asserting under oath that such inducement occurred. The claim that it did is put forward exclusively in legal argument by Madori's attorney. Thus, there is no sworn testimony that inducement occurred, and no claim that Chiapetta or anyone else would testify to any such inducement.
Second, despite Chiapetta's status as a cooperator, there is no basis on which a reasonable jury could find that any encouragement he may have provided to Madori is attributable to the Government. The totality of the record regarding Chiapetta's contacts with the Government concerning Madori is that Chiapetta disclosed that Madori had solicited him to participate in loansharking activities; that Agent Rasey advised him that he could not authorize any participation by Chiapetta unless he agreed to surface as a witness; and that Chiapetta, acknowledging that he understood he had no such authority, went away and participated in the crime anyway. (Rasey Memo; Chiapetta 12/12/02 Aff. ¶ 5; 8/22/03 Tr. 21-24.) Far from operating as a Government agent when he participated in this crime, the record shows that Chiapetta had been expressly ordered not to involve himself with Madori's activities.
Madori argues that Chiapetta's and Rasey's assertions to this effect should not be taken at face value, but could have been disputed by Madori had he offered an entrapment defense. True enough. But in evaluating a jury's likely reaction to any entrapment defense, a matter on which Madori would have borne the burden of proof, United States v. Bala, 236 F.3d 87, 94 (2d Cir. 2000), the Court must consider what the evidence would actually have been. Not only do Rasey and Chiapetta agree on what occurred, but Chiapetta failed to dispute the Government's claim that he was not authorized to pursue further involvement with Madori as a confidential informant when it would have been entirely in his interest to assert the contrary. Madori's attack on the Government's version of these events is supported by no evidence whatsoever, and the possibility that cross-examination would discredit Agent Rasey's account, despite the contemporaneous memorandum documenting his actions, or Chiapetta's testimony, despite his failure to advance a contrary story when it would have benefitted him to do so, is entirely speculative.
Third, even if Madori could show that Chiapetta, as a government agent, induced him to engage in the loan to Meisenberg, the evidence of predisposition, which would defeat the defense, is strong. Any claim of entrapment would have opened the door to evidence of Madori's criminal record, which placed him in Criminal History Category III, and which included convictions for gambling, tax evasion, and usury. (8/18/03 Tr. 14, 24.) Moreover, proof of predisposition is not restricted to such evidence of former criminal activity. The Government could readily argue predisposition from Madori's enthusiastic participation in the offense itself). The tapes, and the testimony of Troncone and Meisenberg, do not reflect a reluctant participant whose will had been overborne, but rather someone who has leapt at the opportunity to pursue this criminal scheme (assuming arguendo that he did not initiate the proposal himself). See United States v. Salerno, 66 F.3d 544, 547-48 (2d Cir. 1995) ("A defendant is predisposed to commit a crime if he is ready and willing without persuasion to commit the crime charged and awaiting any propitious opportunity to do so." (internal quotes and citations omitted)). At any rate, exposure of Chiapetta's cooperation against members of organized crime, and of his claim that he felt compelled to participate with Madori in these transactions by his inability to extricate himself from organized crime figures, could hardly have benefitted the defense, either in an entrapment claim or in any other way.
Finally, even assuming arguendo that some sort of entrapment defense could be created with respect to the making of the extortionate loan, Madori makes no effort to explain how Chiapetta could have induced him to engage in repeated threatening calls and visits to Meisenberg, to enlist Troncone to pressure Meisenberg, or to tell Meisenberg that he was entering "the fucking red zone . . . the danger zone," by failing to repay him. (GX 6T at 10.) There is simply no room for any entrapment defense in connection with the charge of extortionate collection of the loan.
For all of these reasons, there is no merit to the claim that Chiapetta's informant status was materially exculpatory because its disclosure would have generated an entrapment defense with a reasonable likelihood of success, or that the possibility that Madori was entrapped into participation in these crimes undermines confidence in the outcome of the trial.
Madori's third argument, that exposure of Chiapetta's cooperation would have undermined the basis for the conspiracy charges against him, is no more meritorious. First, as amply demonstrated above, there is simply no persuasive evidence that Chiapetta was acting as a government agent in connection with his activities in this case. Not only does Agent Rasey's memo belie any such claim, but Chiapetta himself has never attempted to defend the case by claiming that he was acting as a government agent, and indeed, ultimately pled guilty to conspiring with Madori. Second, the argument that the conspiracy counts would fail if Chiapetta was acting as an undercover agent has the air of a theoretical academic argument, and not of a legitimate trial strategy. To obtain any benefit from a defense, Madori would need to defeat the substantive charges against him, which were predicated on his own conduct, and not on acts of Chiapetta's attributed to him or on any co-conspirator hearsay statements of Chiapetta's. Thus, any claim that Chiapetta's status was materially exculpatory in the sense that it either undermines confidence in the outcome or presents a reasonable likelihood that the jury would have reached a different verdict must ultimately rest on one of Madori's broader arguments.
II. Motion for Discovery and for a Hearing
Madori argues as an alternative that if his new trial motion cannot be granted on the existing record, he should be granted discovery and/or a hearing. This claim is also, for the most part, without merit. The discussion above adequately explains why no hearing is required. As to discovery, Madori primarily seeks access to the few still-redacted portions of the unsealed materials, and to the remainder of the Government's files on Chiapetta's cooperation. To the extent that these files and redacted records disclose matters not connected to this case, they are irrelevant to the matter at hand There is no legitimate reason why Madori or his attorneys need to know the details of Chiapetta's cooperation against others. Nothing in the redacted material regarding that subject has any impact on the issues discussed in this opinion.
The Court notes, however, that it is not clear to the Court that the Government has ever been asked expressly to represent that it has made a thorough search of Chiapetta's informant file, and that no other material relating to to Chiapetta's involvement with Madori in the transactions at issue in this case have been found. Because it is implicit in all of the Government's presentations, and in its initial ex parte application, that it has disclosed all materials bearing on Chiapetta's involvement in this case, the Court is comfortable deciding the new trial motion on the present record. The Government is directed, however, to review all files and records relating to Chiapetta, and to provide defense counsel and the Court with any materials reflecting any statement by Chiapetta to any agent of the Government that refers to Chiapetta's involvement in loansharking activities with Madori in or after 1998, or, if no such materials exist, with a declaration to that effect, by October 22, 2004.
CONCLUSION
For the reasons set forth above, Madori's motion for a new trial is denied.SO ORDERED.