United States v. Joseph Ferriero
2017 U.S. App. LEXIS 14358
| 3rd Cir. | 2017Background
- Joseph Ferriero, longtime chair of the Bergen County Democratic Organization (BCDO), recommended vendor C3 (owned by John Carrino) to local Democratic municipal officials and received payments (25–33% commissions) routed through his consulting company.
- Ferriero pushed C3 to multiple Bergen County municipalities (Dumont, Cliffside Park, Saddle Brook, Teaneck); several towns contracted with C3 without knowing Ferriero had a financial interest.
- Carrino sent an email to Cliffside Park (July 9, 2008) attaching C3 formation documents listing only Carrino; the jury found this omission constituted wire fraud as it concealed Ferriero’s interest.
- A federal grand jury indicted Ferriero on RICO (18 U.S.C. § 1962(c)), Travel Act (18 U.S.C. § 1952), mail/wire fraud counts; jury convicted him on RICO (based on state bribery predicates), Travel Act, and wire fraud; acquitted on some predicates and other counts.
- Ferriero moved pretrial to dismiss RICO for lack of nexus and to invalidate New Jersey’s bribery statute as vague/overbroad; motions were denied. He appealed arguing insufficiency of evidence, statutory construction, vagueness/overbreadth, and reliance on McDonnell.
- The Third Circuit affirmed convictions, holding (1) state bribery predicates were supported by evidence, (2) RICO nexus element satisfied, (3) Carrino’s email omission could be materially misleading for wire fraud, and (4) New Jersey’s bribery statute is constitutional and applicable to party officials; McDonnell did not change the result.
Issues
| Issue | Plaintiff's Argument (Government) | Defendant's Argument (Ferriero) | Held |
|---|---|---|---|
| Whether evidence proved violation of NJ bribery statute as predicate for Travel Act and RICO | Payments were quid pro quo: Ferriero accepted benefits in exchange for recommending C3 to public-party officials | Ferriero argued the government needed proof he agreed to "undermine the integrity" of town decisionmaking (relying on Dansker) | Court: Evidence sufficient—Ferriero agreed to accept payments as consideration for recommendations; Dansker's special "integrity-undermining" gloss need not be read into the current NJ statute |
| Whether RICO §1962(c) "nexus" (racketeering as a means of conducting enterprise affairs) was proved | The C3 bribery scheme was one means by which Ferriero participated in BCDO affairs because recommending vendors was party business and he used that influence | Ferriero contended association-facilitated predicates cannot satisfy nexus; also argued insufficient proof he acted in official capacity | Court: Nexus satisfied—jury could rationally find bribery was a means of conducting BCDO affairs; association that facilitated predicates can also satisfy nexus |
| Whether Carrino's email omission to Cliffside Park constituted wire fraud (material misrepresentation/omission) | Email, though true as to corporate formation, was a half-truth that omitted Ferriero’s financial interest; that omission was materially misleading and intended to obtain borough funds | Ferriero argued omission alone (no fiduciary duty) cannot support fraud (citing Kehr/Chiarella principles) | Court: Evidence sufficient—context made the omission materially misleading; jury reasonably found a scheme to defraud |
| Whether NJ bribery statute is unconstitutionally vague or overbroad (and whether Travel Act/RICO cover party-official bribery) | Government: statute clearly proscribes quid-pro-quo payments for decisions/recommendations/votes; bribery concept encompasses party officials; statute gives fair notice | Ferriero: statute vague (terms like "any benefit not authorized by law" and "on a public issue") and overbroad; party officials should be excluded from federal predicates | Court: Statute sufficiently clear and not overbroad; party officials fall within generic bribery concept incorporated into Travel Act and RICO |
Key Cases Cited
- Dansker v. United States, 537 F.2d 40 (3d Cir. 1976) (construing predecessor NJ bribery statute and limiting its reach to conduct intended to corrupt public office or action)
- In re Insurance Brokerage Antitrust Litigation, 618 F.3d 300 (3d Cir. 2010) (explaining RICO §1962(c) nexus requires racketeering be a means of conducting enterprise affairs)
- Reves v. Ernst & Young, 507 U.S. 170 (U.S. 1993) (discussing participation-in-affairs element under §1962(c))
- Perrin v. United States, 444 U.S. 37 (U.S. 1979) (holding Travel Act’s "bribery" covers commercial and nontraditional bribery beyond narrow common-law public-official bribery)
- McDonnell v. United States, 136 S. Ct. 2355 (U.S. 2016) (narrowing the definition of "official act" under federal bribery law and cautioning against overly broad constructions that chill ordinary official conduct)