United States v. Pawlowski

351 F.Supp.3d 840

UNITED STATES of America

v.Edwin PAWLOWSKI

CRIMINAL ACTION No. 17-390-1

United States District Court, E.D. Pennsylvania.

Signed November 20, 2018

Anthony Wzorek, Michelle Morgan, Richard P. Barrett, U.S. Attorney's Office, Philadelphia, PA, for United States of America.

MEMORANDUM

Juan R. Sánchez, C.J.

On March 1, 2018, after a six-week trial, a jury convicted Defendant Edwin Pawlowski, the former mayor of the City of Allentown, of 47 counts of corruption-related offenses arising out of his orchestration of a pay-to-play scheme while in public office to fund his campaigns for Governor of Pennsylvania and the United States Senate. At the close of the Government's case, and again at the close of all evidence, Pawlowski moved for a judgment of acquittal pursuant to Federal Rule of Criminal Procedure 29. The Court reserved ruling on the motion. By Order of October 22, 2018, the Court granted Pawlowski's motion in part and denied it in part. Pursuant to Third Circuit Local Appellate Rule 3.1, the Court issues this Memorandum to summarize the basis for its rulings.

BACKGROUND

In July 2017, Pawlowski and Co-Defendants Scott Allinson and James Hickey were charged by indictment with conspiring to commit mail fraud, wire fraud, honest services fraud, federal program bribery, and Travel Act bribery and with numerous substantive offenses, arising out of Pawlowski's wide-ranging pay-to-play scheme. As discussed in greater detail below, the scheme involved various sub-schemes whereby Pawlowski, directly and through his operatives, agreed to steer City contracts or provide other favorable official action to companies, law firms, and individuals in exchange for campaign contributions and other items of value. In addition to the conspiracy charge (Count 1), Pawlowski was charged with 14 counts of federal program bribery (soliciting), in violation of 18 U.S.C. § 666 (Counts 2, 4-11, 13, 15-18); three counts of attempted Hobbs Act extortion under color of official right, in violation of 18 U.S.C. §§ 1951 and 2 (Counts 3, 12, 14); nine counts of mail fraud, in violation of 18 U.S.C. § 1341 (Counts 20-28); nine counts of wire fraud, in violation of 18 U.S.C. § 1343 (Counts 29-37); six counts of honest services wire fraud, in violation of 18 U.S.C. §§ 1343 and 1346 (Counts 38-43); two counts of honest services mail fraud, in violation of 18 U.S.C. §§ 1341 and 1346 (Counts 44-45); three counts of Travel Act bribery, in violation of 18 U.S.C. § 1952 (Counts 46-48); and seven counts of making false statements, in violation of 18 U.S.C. § 1001 (Counts 49-55).

Pawlowski and Allinson, an attorney whose law firm was seeking contract work from the City, proceeded to trial in January 2018.¹ At trial, the Government sought to establish Pawlowski's orchestration of and involvement in the pay-to-play scheme through tape recorded conversations,² witness testimony, and documentary evidence. The Government's proof showed that Pawlowski used and sold his public office to raise campaign funds for his political ambitions to become the Governor of Pennsylvania and a United States Senator. In order to identify potential donors to his campaigns, Pawlowski generated lists of vendors that held City contracts and used those lists to determine the amount of campaign contributions to be solicited from the vendors. Pawlowski also targeted vendors that were affiliated with politically-influential individuals in the Democratic party for City contracts and then solicited campaign contributions from these vendors.

To facilitate his pay-to-play scheme, Pawlowski deployed his campaign staff, campaign manager Michael Fleck³ and campaign aide Sam Ruchlewicz, as his operatives. Francis Dougherty, the City's Managing Director, also worked closely with Pawlowski and assisted with Pawlowski's scheme. Pawlowski told Dougherty that Fleck and Ruchlewicz "represented him," and Dougherty thus took direction on City-related matters from them in addition to Pawlowski. Trial Tr. Day 3 at 76-77, Jan. 23, 2018. By late 2013 to 2014, Pawlowski had provided Fleck and Ruchlewicz—who would otherwise have no authority to conduct official City business—with direct access to City Hall, enabling them to meet with City officials to manage the awarding of City contracts on their own. Even though he used Fleck, Ruchlewicz, and Dougherty to help execute his scheme and provide a layer of insulation between him and those he sought to engage in his scheme, Pawlowski was "paranoid" about his conduct being detected. See Trial Tr. Day 9 at 168, Feb. 2, 2018. To further shield his conduct from being discovered, Pawlowski took additional precautionary measures, including sweeping his office for electronic eavesdropping devices, using burner phones, and speaking to his operatives in person to avoid being recorded. See id.

The evidence at trial connected Pawlowski to nine pay-to-play sub-schemes, involving (1) an agreement to expedite a zoning application and inspection for real estate developer Ramzi Haddad, in addition to the steering of City contracts (2) for the collection of delinquent real estate taxes to Northeast Revenue Service; (3) to revamp the City's street lights to The Efficiency Network; (4) to update the City's cybersecurity system to CIIBER; (5) for the design and construction of the City's pools to Spillman Farmer Architects; (6) for a street construction project to McTish, Kunkel & Associates; and for legal services to the law firms of (7) Norris McLaughlin; (8) Stevens & Lee; and (9) Dilworth Paxson all in exchange for campaign contributions or other items of value.

Following a six-week trial, Pawlowski was convicted of 47 of the 54 counts against him.⁴ At the close of the Government's case, and again at the close of all evidence, Pawlowski moved for a judgment of acquittal on all counts on the basis that the Government's evidence was insufficient to sustain his convictions.⁵ On October 22, 2018, the Court granted Pawlowski's motion in part and denied it in part. The Court explains the basis for its rulings below.

LEGAL STANDARD

Under Federal Rule of Criminal Procedure 29, a defendant may move for a judgment of acquittal "[a]fter the [G]overnment closes its evidence or after the close of all evidence." Fed. R. Crim. P. 29(a). The court must grant the motion and enter a judgment of acquittal "of any offense for which the evidence is insufficient to sustain a conviction." Id. In evaluating a sufficiency of the evidence challenge pursuant to Rule 29, a district court must "review the record in the light most favorable to the [Government] to determine whether any rational trier of fact could have found proof of guilt beyond a reasonable doubt based on the available evidence." United States v. Smith , 294 F.3d 473, 476 (3d Cir. 2002) (internal quotation marks and citation omitted). When a court reserves ruling on a Rule 29 motion made at the close of the Government's case, the court must "decide the motion on the basis of the evidence at the time the ruling was reserved." Fed. R. Crim. P. 29(b) ; see also United States v. Brodie , 403 F.3d 123, 133 (3d Cir. 2005) ("[T]he District Court was required to, and properly did, determine whether an acquittal was appropriate based solely on the evidence presented by the [G]overnment."). The court must "review the evidence as a whole, not in isolation," United States v. Boria , 592 F.3d 476, 480 (3d Cir. 2010), and should not weigh the evidence or determine the credibility of witnesses, United States v. Dent , 149 F.3d 180, 187 (3d Cir. 1998). The Court "must uphold the jury's verdict unless no reasonable juror could accept the evidence as sufficient to support the defendant's guilt beyond a reasonable doubt." United States v. Fattah , 902 F.3d 197, 268 (3d Cir. 2018).

DISCUSSION

In his Rule 29 motion, Pawlowski argues a judgment of acquittal should be entered as to the counts of the Indictment charging him with attempted Hobbs Act extortion under color of official right, honest services mail and wire fraud, federal program bribery, and Travel Act bribery because the Government failed to prove an explicit quid pro quo, as required under McCormick v. United States , 500 U.S. 257, 111 S.Ct. 1807, 114 L.Ed.2d 307 (1991), or that he took (or agreed to take) any "official acts" in exchange for a thing of value to satisfy McDonnell v. United States , ––– U.S. ––––, 136 S.Ct. 2355, 195 L.Ed.2d 639 (2016). Relying on these arguments, Pawlowski asserts a judgment of acquittal should be entered as to the counts of the Indictment charging him with mail and wire fraud as well. He further argues the Government failed to prove he made false statements to agents of the Federal Bureau of Investigation, and a judgment of acquittal should also be entered as to these counts. The Court will address Pawlowski's arguments as to the attempted Hobbs Act extortion under color of official right, honest services mail and wire fraud, federal program bribery, and Travel Act bribery counts in Section A, mail and wire fraud counts in Section B, and false statements counts in Section C.

A. Attempted Hobbs Act Extortion, Honest Services Mail and Wire Fraud, Federal Program Bribery, and Travel Act Bribery

As noted, in his Rule 29 motion, Pawlowski argues the Government failed to prove an explicit quid pro quo for each of the attempted Hobbs Act extortion under color of official right, honest services mail and wire fraud, federal program bribery, and Travel Act bribery counts, or that these counts involved an official act by Pawlowski.

To sustain a conviction for Hobbs Act extortion under color of official right, the Government must offer proof of a quid pro quo—i.e., that a public official " ‘receive[d] a payment in return for his agreement to perform specific official acts.’ " United States v. Munchak , 527 F. App'x 191, 193 (3d Cir. 2013) (quoting Evans v. United States , 504 U.S. 255, 268, 112 S.Ct. 1881, 119 L.Ed.2d 57 (1992) ); see also In re Lueders' Estate , 164...