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United States v. Gambino

decided: November 21, 1977.


Appeal from a judgment entered by the District Court for the Southern District of New York (Ward, D.J.) sitting without a jury, convicting both defendants of conspiracy, racketeering, obstruction of commerce, and extortionate collection of extension of credit, and one defendant of income tax evasion. The Court of Appeals held: (1) sufficient evidence was introduced to prove that defendants conspired to control a private sanitation industry in the Bronx, and extorted payments from the owners of a private sanitation firm; and (2) there was a sufficient interestate involvement to sustain defendants' convictions under the Hobbs Act.

Friendly, Gurfein and Meskill, Circuit Judges.

Author: Gurfein

GURFEIN, Circuit Judge:

The appellants were convicted of conspiracy,*fn1 violation of the Anti-Racketeering Act, 18 U.S.C. § 1962(b),*fn2 violation of the Consumer Credit Protection Act, 18 U.S.C. § 894,*fn3 and violation of the Hobbs Act, 18 U.S.C. § 1951.*fn4 Gambino was found guilty also of tax evasion for the years 1970-1973 and 1975.*fn5

The appellants contend that there was insufficient evidence to prove a conspiracy to acquire and maintain control of the private sanitation industry in the Coop City area of the Bronx through a pattern of racketeering activity. They argue that there was insufficient evidence to warrant a conviction under Count Four, which charged that Gambino and Conti used threats and violence in order to collect an extension of credit from Peter Darminio. Specifically, they point to an alleged lack of corroboration of Darminio's testimony.

The general outline of the case indicates that Gambino and Conti had controlled certain stops for private garbage collection in the Bronx but were unable to get a carting license from the City. They arranged for Terminal Sanitation, a licensed private sanitation firm, owned by Peter and Anthony Darminio, to collect at all of the stops which Gambino had previously acquired in the Bronx. The Darminios were required to kick back to Gambino one-third of all the moneys they received from servicing the stops.

Judge Ward, sitting without a jury, found that Gambino and Conti maintained control of garbage collection in Coop City and other areas of the Bronx by threatening to kill competitors and by administering beatings. This activity included an assault on an undercover agent of the FBI who was posing as a cart man and who had solicited a stop in Coop City. Judge Ward also found that Gambino engaged in extensive loansharking activities, lending a total of $90,000 to Peter and Anthony Darminio in 1970 and 1971 and $75,000 to Peter in 1972. These loans were collected by Gambino and Conti through the use of threats and violence.

The court carefully reviewed the evidence. Ralph Torres, an employee of Gambino and Conti, was found to be a credible witness by Judge Ward. Although the credibility of Peter Darminio was in question, his testimony concerning the defendant's extortionate extensions of credit was corroborated by an exhibit in evidence bearing Gambino's handwriting, headed with the word "Peter" and containing a column of figures and certain calculations. Judge Ward further found that Conti, who was collecting the payments, threatened and beat Darminio from time to time when he was late in making payments.

In July of 1973 one Bernard Ettinger, who had sold Terminal to the Darminios in 1968 and who had not been paid in full in connection with the sale, complained in writing to the New York City Department of Consumer Affairs, requesting that the department see to it that the Darminios fulfilled their obligations to him before the department approved any sale of stops registered to Terminal. Shortly thereafter, Conti visited Ettinger at his office, slapped Mr. Ettinger on the face, and told him that he had better not complaint to the department.

On an earlier occasion when Ettinger had threatened to foreclose on Anthony Darminio's home, on which he held a mortgage, Mr. and Mrs. Darminio had asked Mr. Gambino for assistance, and Gambino replied "Don't worry about it. I'll send Carlo Conti to straighten it out." In 1974, Ettinger pressed Darminio for payment, which was then a balance of $90,000. A meeting was arranged. Gambino came with Darminio. Gambino said that if Ettinger would settle, Darminio could sell some stops and there would be some stops left over so that Peter Darminio could continue his route. Ettinger agreed to settle for $40,000. One Joseph Perillo, who was also present at the meeting, indicated that he was prepared to purchase some stops from Terminal but did not have money with him for a down payment. Gambino gave Perillo $5,000, which Perillo, in turn, gave to Ettinger. The court found Ettinger to be a highly credible witness.

In November 1975, Terminal entered into a contract with P & S Sanitation, a newly organized company, to take over Terminal's stops. The court found that Gambino was active in P & S.

In the Fall of 1976, the FBI incorporated American Automated Refuse & Waste Removal, Inc., and set up an office in the Bronx. They bought trucks and a winch, the winch being shipped from Texas, and arranged to dump the garbage in New Jersey. They then began soliciting garbage collection accounts, including Harry's Service Station which they knew was being serviced by P & S Sanitation. On December 1, 1976, Harry's entered into an agreement with American Automated, the Government company. American Automated arranged to drop off a container at Harry's to store garbage which would be collected by Automated. Shortly thereafter, Conti telephoned American Automated and came to the office. He threatened to kill the person seated at the desk, who called himself Wayne Dacon but who was in fact an agent of the FBI named Walter Wayne Orrell. Conti's statement to Orrell included a threat to throw the agent out of the window. This conversation was tape-recorded and the tape was received in evidence. Conti indicated that anything new that opened up in Coop City was his. There were two places on the tape where a crunching sound was audible. Agent Orrell testified that Conti punched him. The evidence established that Conti acted frequently at the behest of Gambino, that both men conspired to acquire and maintain control of the private sanitation industry in Coop City and other areas of the Bronx through a pattern of racketeering activity and that they in fact carried out the purpose of the conspiracy, that both men obstructed commerce by extorting payments from Terminal Sanitation and its principals, and that Conti attempted to obstruct commerce by assaulting and threatening to kill persons associated with American Automated, Inc.

These findings of the experienced trial judge cannot lightly be set aside. Nor do we see any reason for so doing. We hold that there was sufficient evidence to sustain the convictions on the counts upon which Conti was convicted.

The claim that there was insufficient evidence to sustain the conviction on Count Four which charged the use of extortionate means to collect the $75,000 loan to Peter Darminio must be rejected. There can be no doubt that Section 894 is violated when force and violence are used to collect an extension of credit. United States v. Natale, 526 F.2d 1160, 1165 (2d Cir. 1975), cert. denied, 425 U.S. 950, 48 L. Ed. 2d 193, 96 S. Ct. 1724 (1976). When Peter Darminio was slow in making payments, he was threatened and beaten by Conti on several occasions and was struck and threatened on one occasion by Gambino himself. ...

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