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United States v. O'Malley

decided: July 9, 1986.


Appeals from the United States District Court for the Northern District of Illinois, Eastern Division, No. 84 CR 727--James B. Moran, Judge.

Author: Coffey

Before CUMMINGS, Chief Judge, COFFEY and RIPPLE, Circuit Judges.

COFFEY, Circuit Judge.

The defendants, David O'Malley and Robert Salerno, were indicted with six other persons for RICO racketeering, racketeering conspiracy and multiple counts of attempted extortion and extortion, in violation of 18 U.S.C. §§ 1962(c), (d) and 1951. Following a seven-week trial, O'Malley was found guilty of racketeering conspiracy (Count I), racketeering (Count III) and thirteen separate counts of extortion, including the attempted extortion of a theater movie owner (Count XX). Salerno was found guilty of racketeering conspiracy (Count I), racketeering (Count VII), attempted extortion of a movie theater owner (Count XX) and extortion (Count XXXI). The district court had earlier entered judgment for Salerno dismissing Count XVI that charged him with extortion. O'Malley was sentenced to ten years imprisonment for his conviction on the RICO conspiracy and racketeering counts to be followed with five years probation for his conviction on the extortion counts and Salerno was sentenced to four years imprisonment for his conviction on the RICO conspiracy and racketeering counts, also to be followed with five years probation for his conviction on the extortion counts. They filed this joint appeal. We affirm.


The evidence reveals that the defendants participated in a conspiratorial enterprise to extract "street taxes" from various legitimate and non-legitimate businesses in the Chicago, Illinois metropolitan area from 1973 until 1983. A "street tax" is a slang phrase describing extortion payments made by the victims to the defendants to allow them to remain in business. The "street tax" conspiracy was divided into three separate ventures: extorting money from automobile salvage yards, bookmakers, and a theater owner. It was established at trial that O'Malley, along with John Manzella, not a party to this appeal, extorted money from at least seven different automobile yards. For example, Martin Citron, a partner in Chippewa Sam's Auto Parts received a visit from three unindicted co-conspirators in March 1982 who demanded $10,000 in street taxes; Citron refused to pay. Citron subsequently met with Manzella and O'Malley. Manzella told Citron that his people "were not happy" with Citron's refusal to pay the extortion money and told Citron that "you either pay or you go out of business." O'Malley then threatened "to chop his hands off" if Citron refused to pay. Citron became a nervous wreck and folded his business two months later.

Salerno was involved in extorting money from bookmakers in the Chicago metropolitan area. The government introduced evidence that Manzella had extorted money from bookmakers in the Chicago area, including Carol Ellison, David Kopulous and Steve Hospodar. Specifically, in 1979, Manzella introduced Hospodar to Salerno and told Hospodar that Salerno would be collecting the money in the future. Salerno telephoned Hospodar and demanded that Hospodar advance the dates for the extortion payments, but Hospodar refused. Approximately one week later Manzella called Hospodar and instructed him to go to the Sky View Restaurant in Chicago; Salerno, Manzella and two of the other extortionists attended this meeting. Salerno told Hospodar that "you don't talk to me on the phone the way you did. I want you to know I am the enforcer around here." One month later, in January 1980, Hospodar's office on his car lot burned to the ground. In a subsequent conversation with Hospodar, Manzella told him that he "expected it," referring to the fire.

Both Salerno and O'Malley participated in an attempt to extort money from theater owner, Joel Ross. Ross was approached by Salerno and three other extortionists in May 1983 and was told by Salerno that "if you don't belong to somebody, you belong to us." Salerno told Ross that the theaters in the Chicago area were paying $10,000 per month and that he (Salerno) expected this same amount of money from him. Ross testified that he avoided subsequent calls from Salerno, but Salerno eventually was able to contact Ross and told him that if he (Ross) did not cooperate he would "pick up" Ross' wife and son. Ross explained to Salerno that his movie house was involved in bankruptcy proceedings and that he could not afford to make extortion payments. In December of 1983, O'Malley and Garelli, not a party to this appeal, approached Ross and told him that they "had been sent by the people that had been there before and that they were one big happy family and I was going to do what they told me to do." Tr. at 157. Salerno subsequently called Ross in mid-December 1980 and explained that Ross would have to talk to "these people" as it was no longer Salerno's area. Tr. at 159. Within hours of this conversation, O'Malley and Garelli again appeared at the theater and demanded $5,000 per month from Ross to stay in business. Ross again explained that he did not have the money to give them. After several more unsuccessful attempts to obtain the money from Ross, O'Malley told him "you'll have to suffer the consequences." Tr. at 163. Ross testified that he did not see O'Malley or Salerno again until trial.

On appeal, Salerno and O'Malley raise a phlethora of issues, including: (1) whether the district court's RICO conspiracy jury instruction failed to define the essential elements of the crime; (2) whether the jury instruction defining the interstate commerce element of the Hobbs Act Count (18 U.S.C. § 1951) was worded so as to improperly direct a verdict against the defendants; (3) whether the court committed prejudicial error in allowing the government to present evidence to impeach its own witness and in allowing the government to argue in closing argument the facts relating to a substantive count dismissed by the court as evidence of Salerno's participation in the RICO conspiracy; (4) whether the court failed to order Jencks Act material produced for in camera inspection; (5) whether the court improperly allowed prejudicial co-conspirator declarations into evidence; and (6) whether the evidence is sufficient to support Salerno's conviction for extorting money from bookmaker Steve Hospodar (Count XXXI).


RICO Conspiracy Jury Instruction

Both defendants argue that the RICO conspiracy instruction was fatally flawed as it failed to instruct the jury on two elements of the RICO conspiracy: personal participation in the conspiracy and a pattern of racketeering activity. Before the jury was instructed, the court met in chambers with the attorneys to review the proposed jury instructions. This conference was not transcribed by a court reporter.*fn1 After the jury was instructed, the court asked the defendant to memorialize their objections registered at the instruction conference. The defense attorney for O'Malley stated only that he objected "generally to all the instructions. I don't want to go over them in particular, Judge . . . . I'm going to adopt any other objections that counsel make." Tr. 4091. The court then noted for the record the objections registered at conference by the other defense attorneys. Tr. 4091-99. No attorney objected to instruction No. 46, the RICO conspiracy jury instruction that defendants now complain was fatally flawed. It is clear that absent a specific objection, as contrasted with a general objection, "stating distinctly the matter to which he objects and the grounds for his objection," the court may not reverse a conviction based upon an erroneous instruction absent "plain error" since the alleged error is deemed waived. United States v. Markowski, 772 F.2d 358, 363 (7th Cir. 1985); United States v. Watson, 623 F.2d 1198, 1204 (7th Cir. 1980) (failure to make specific objection "to alleged omissions precludes our review . . . absent a determination that the omissions constituted plain error."); Fed. R. Crim. P. 30.*fn2 With this standard of review in mind, we turn to the other jury instructions in this case.

The defendants allege that the court erroneously instructed the jury that it could convict the defendants on the RICO conspiracy count based upon acts that they did not perform or participate in. In instruction 46, the court informed the jury that in order to establish the agreement element of the RICO conspiracy count the government must prove:

"That each defendant knowingly became a member of the conspiracy; that is each defendant agreed by committing two or more acts of extortion, attempted extortion or intimidation to participate, either directly or indirectly, in ...

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