United States v. Carmine Romano and Peter Romano

Citations: 684 F.2d 1057; 10 Fed. R. Serv. 1495; 1982 U.S. App. LEXIS 18004Docket: 1185

Court: Court of Appeals for the Second Circuit; June 24, 1982; Federal Appellate Court

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Carmine and Peter Romano were convicted on February 5, 1982, in the Southern District of New York for their involvement in a racketeering conspiracy to extort protection money from wholesalers in the Fulton Fish Market, leveraging their control over the workers' union. They faced multiple charges including conspiracy and violations under the Racketeer Influenced and Corrupt Organizations Act (RICO) and the Taft-Hartley Act. Carmine was also found guilty of misusing union pension funds, while Peter was convicted for obstruction of justice and perjury. The government dropped one extortion count against Carmine before the trial. The court sentenced Carmine to twelve years in prison and a fine of $20,000, while Peter received eighteen months' imprisonment. The charges stemmed from a 167-count indictment, which was reduced to 94 counts for the trial. Key allegations included extortion, illegal labor payments, misuse of funds, and obstruction of justice, with specific instances detailing the use of fear and cash to extract payments from businesses in the market, as well as the operation of a protection service. The appellate court found no errors in the trial proceedings and affirmed the convictions.

Count Two charges Carmine and Peter Romano with a substantive RICO violation under 18 U.S.C. § 1962(c). The alleged predicate acts include receiving illegal payments by the Romancos in violation of 19 U.S.C. § 186(b)(1), misuse of union pension funds by Carmine Romano under 18 U.S.C. § 1954, and Peter Romano's obstruction of justice under 18 U.S.C. § 1503. Additionally, Carmine faces twelve counts related to receiving television sets as gifts for opening accounts with union pension funds, violating 18 U.S.C. §§ 1954 and 2. Counts Fifteen through Sixty and Sixty-one through Ninety-one charge both Romancos with aiding and abetting Taft-Hartley Act violations concerning the rental of union signs for $300 per year, under 29 U.S.C. § 186(b)(1) and 18 U.S.C. § 2. Carmine is also charged with receiving a $300 payment from Booth Fisheries Co., violating 29 U.S.C. § 186(b)(1). A charge of extortion against Carmine was dismissed prior to jury submission due to a witness's failure to testify. Peter faces charges of perjury under 18 U.S.C. § 1623 and obstruction of justice for false statements regarding a subpoena related to union sign rentals.

The Fulton Fish Market, essential for New York's seafood supply, operates daily with significant activity from 2 a.m. to 8 a.m. It comprises the Old and New Markets, housing approximately 80 wholesalers and employing around 800 workers from Local 359 of the United Seafood Workers Union. Carmine served as Secretary-Treasurer of Local 359 from May 1974 until May 1980, after which Peter succeeded him. Carmine then became the Executive Administrator of the Fulton Fish Market Welfare and Pension Trust Funds.

In 1975, the New York Wholesale Fish Dealers Association sought Carmine's help to combat thefts at the market, believing that union oversight would deter criminals. Carmine established the Fulton Patrol Service, which, despite not being officially linked to him in documentation, was evidenced by his involvement in its operations and claims settlement. The Fulton Patrol Service was hired for $1300 weekly, resulting in a significant decrease in thefts in the New Market, and later, the Old Market also adopted their services, leading to similar results. From November 1975 to October 1981, the Patrol Service collected over $644,000 from wholesalers in the market.

Evidence indicates that the Fulton Patrol's effectiveness in reducing thefts at the market was likely due to the influence of Carmine Romano and his associates over the thieves, rather than the quality of the Patrol's operations, which were significantly flawed. Notably, a Patrol watchman, who was related to the Patrol's manager, was a known kleptomaniac. Several listed watchmen were fictitious, and a patrolling watchman claimed that only one other colleague actually worked. Additionally, a woman connected to Carmine received $200 weekly for minimal communication with absent watchmen.

Substantial evidence pointed to the union's control over market thieves. Pontebbi hired former union delegate Anthony O'Connor to help recover stolen goods, along with Carmine's brother, Vincent Romano, who was paid $450 weekly. Despite their purported roles, no patrolling watchmen reported seeing them on-site.

Businesses that experienced thefts approached Carmine for reimbursements from the Fulton Patrol Service, which assured protection against theft. After a burglary incident, Carmine expressed intentions to retaliate against the culprits. Following Peter's ascension in Local 359, theft reports were directed to him.

Additionally, the union collected "Christmas payments" from wholesalers from 1975 to 1979, often solicited by other businessmen who claimed the money was for union members. Many testified they felt pressured to pay these amounts, believing them to be illegal. For example, Arnold Smith from Caleby Haley, Co. cited peer pressure as a reason for compliance. In December 1979, the Fishmongers Association made a $2400 cash contribution, which was typical of these payments. Union officials occasionally directly solicited these contributions, as evidenced by Carmine or O'Connor instructing a company president to deliver cash directly to the union.

Merchants at Fulton Market were coerced into paying $25 monthly for rental of cardboard union signs, despite many believing the practice was illegal and the signs not worth the cost. Business owners, such as Terrence Levy and Bartone, continued to rent the signs out of perceived necessity to operate their businesses. Carmine Romano and his co-conspirators also exploited union welfare and pension funds between 1974 and 1979, diverting over $168,000 deposited in Republic National Bank, from which they unlawfully retained over $10,000 worth of color television sets given as gifts for new accounts. Union sponsors of the pension fund accounts failed to report these gifts to the fund or the Department of Labor, and had they chosen a different bank, the pension fund would have gained an additional $10,000 in interest. On January 14, 1981, Peter Romano falsely testified under subpoena to a grand jury that he had no documents related to union signs, despite possessing a telegram and a letter indicating the rental violated union rules. Neither defendant testified at trial, and the jury convicted them on all counts, ordering them to forfeit their union positions under 18 U.S.C. § 1963. Prior to sentencing, Carmine Romano's bail was revoked due to concerns of being a continuing danger to the community, a decision affirmed by the court on November 3, 1981.

A sentencing hearing for Carmine Romano took place on February 2 and 3, 1982, where testimonies highlighted his connections to the Genovese organized crime family and his influence over illegal activities at the Fulton Fish Market. The court determined that organized crime fostered a pervasive atmosphere of fear at the market, resulting in Romano receiving a twelve-year sentence and a $20,000 fine. The core legal issue is whether Romano's acceptance of television sets from the Republic National Bank, given for opening union pension fund accounts, violated 18 U.S.C. § 1954. This statute penalizes pension plan trustees who receive items of value with the intent to be influenced regarding plan-related decisions. Romano admitted his actions fell within the statute's scope but argued that the gifts were lawful as they were publicly offered to all account holders. 

The court disagreed, noting that while Congress primarily focused on kickbacks, the legislative history indicated a broader concern for any conflict-of-interest payments. The statute's language explicitly prohibits receiving any form of value, not limited to kickbacks, especially when intended to influence decisions concerning pension funds. Romano's argument that the statute unfairly penalizes customary business gifts was rejected, as the substantial value of the gifts received (over $10,000 in televisions) exceeded the threshold of "de minimis" gifts. Furthermore, given the jury’s finding of his intent to violate the law, his conduct was not merely a technical infraction.

Romano's argument for prosecution under 18 U.S.C. § 664 for embezzlement instead of § 1954 is rejected, as the television sets in question were not the property of the pension plan. Romano's claim regarding the improper admission of evidence related to "Christmas payments," the Fulton Patrol Service, and wholesalers' state of mind is also dismissed; this evidence was relevant to the conspiracy charge, which involved extortion and related activities. The court ruled that the jury instructions were appropriate, despite Romano's failure to object. The prosecutor's references to fear generated by Romano were deemed permissible, supporting the conspiracy charge based on evidence of payments made under duress. Furthermore, the defendants' argument that their conspiracy convictions must be reversed due to the absence of mens rea in Taft-Hartley violations is unfounded; they were charged with violating the RICO statute, which does require proof of intent. The jury was properly instructed on the need for awareness of the unlawful nature of the conspiracy. Lastly, Romano's claim that his twelve-year sentence was improper due to a lack of specific findings by the district court is rejected; the sentencing was justified based on Romano's background independent of the hearing, and the sentence was considered lenient upon review.

The defendants' claim of being denied a public trial due to the district court locking the courtroom doors during jury instructions is deemed frivolous, as members of the public were present and the closure was a reasonable measure to minimize distractions. Peter Romano's assertion of being denied due process regarding the rental of union signs under the Taft-Hartley Act is also rejected; the government had no obligation to inform him of the law, especially given that his actions were not passive and he should have been aware of their legality. Romano's claim that his false grand jury testimony was immaterial is unfounded, as the documents he lied about would have been significant to the grand jury's inquiry into possible RICO and extortion charges, thus constituting material perjury under 18 U.S.C. § 1623. Lastly, the court found no clear error in admitting hearsay evidence regarding "Christmas payments" made to wholesalers, which were linked to a conspiracy. Testimony indicated that such payments were made at the request of wholesalers and were associated with the union. The district court's findings, supported by evidence of co-conspirators’ involvement, were upheld. Even if there were errors in the court's findings, the statements about the payments were admissible as they were contemporaneous with relevant actions.

Judgments of conviction are affirmed, and the mandate will be issued immediately. Bartone instructed Julius Sirowitz of T.S. Fish Co. to deliver $300 as a "Christmas payment" for union members, alongside similar requests to other wholesalers. Terrence Levy of N.P. Levy Co. refused to pay due to grievances over the union's lack of respect at his father's funeral. The court noted that while 18 U.S.C. § 1954 does not require proof of corrupt intent, the jury was instructed to find that the defendant acted with "bad purpose" and specific intent to violate the law. The jury determined that Carmine Romano accepted the payments with corrupt intent. The statute allows fiduciaries to receive legitimate compensation for services, but the television sets received by the defendant did not qualify. 

Additionally, defendants contested the prosecutor's claims regarding the authenticity of a union plaque, arguing it was improper; however, the remarks were deemed relevant to the defendants' intent under RICO. The defendants' argument against the enhancement of non-mens rea misdemeanors to a felony under RICO was dismissed as frivolous. During sentencing, it was noted that witnesses, fearing for their safety, refused to testify despite immunity, with one, Alec B. Messing, having served time for contempt due to threats against him and his family. Evidence presented at trial indicated that Carmine was feared in the Fulton Fish Market, influencing witnesses' testimonies.