Sometimes, the cooperating witness in a case seems a little shadier than the guy who got caught.
Herman Friedman owned an apartment building in West New York, New Jersey. He rented out 16 apartments. One day, a building inspector visited Mr. Friedman’s property. He noticed that the building had only 15 legal units – not 16. The inspector issued a Notice of Violation.
To try to sort this out, Mr. Friedman went to meet with a Construction Code Official, Franco Zanardelli. Perhaps like many New Jersey zoning officials, Mr. Zanardelli was working for the FBI. He was trying to get a sentence reduction under 5K1.1 after he was caught taking bribes in a prior investigation.
Mr. Friedman told Mr. Zanardelli that the apartment had 16 legal units when he bought it and that he shouldn’t be penalized. Mr. Friedman asked Zanardelli to issue a variance for his 16th unit.
Zanardelli took no official action in response. One can imagine that he shrugged.
Without a resolution from Zanardelli, Mr. Friedman went to Municipal Court. The court told him to try to work things out with Zanardelli because the penalty for having an illegal apartment is $500 a day.
Mr. Friedman called Zanardelli, desperate for help. Zanardelli asked him “What, what do you want to do? You just want to legalize the unit?”
Mr. Friedman indicated that this was exactly what he wanted to do.
They met at the building. Mr. Friedman pointed out that the 16th unit had obviously been there a while. Zanardelli said it wasn’t in the tax records. He asked again what Mr. Friedman wanted to do.
Mr. Zanardelli told Mr. Friedman he could go for a variance. That wouldn’t solve the $500 a day problem. They had this exchange,
Zanardelli: [y]ou’re gonna have to go for a variance. That’s it. I mean, I mean what are you gonna do.
Friedman: “Well, you know what you could do, what you can do?
Zanardelli: “So what are you suggesting here?
Friedman: “You tell me . . . Whatever it is.”
Zanardelli: “I can’t tell you, you tell me.”
If you couldn’t guess, “whatever it is” was a bribe.
Using hand gestures, the two worked out a bribe of $5,000. Mr. Zanardelli lifted the complaint.
Months passed. Mr. Friedman didn’t come through with the money. He avoided Mr. Zanardelli’s calls. Mr. Zanardelli pressured him at the direction of the FBI, reissuing the complaint.
Mr. Friedman put the building up for sale. He found a buyer who would buy it only if the building had 16 units. Mr. Friedman, finally, paid $5,000 to Zanardelli. He didn’t lift the complaint. The sale fell through.
Close to a year later, Mr. Friedman was indicted.
At trial, Mr. Friedman tried to introduce evidence that the records in Mr. Zanardelli’s office actually showed that the building had 16 legal apartments. According to a witness from the local zoning office, the best, most recent documents, showed that Mr. Friedman was allowed to have 16 units there.
The trial judge didn’t let the evidence in, because it was “a whimsical argument that this is somehow related to entrapment.”
Mr. Friedman was convicted.
At sentencing, the government and Mr. Friedman disagreed about the loss amount from the bribery guidelines.
The bribery guidelines are particularly hard on people convicted of a crime. The loss amount that U.S.S.G. § 2C1.1 aren’t based on the amount of the bribe, but, rather, based on “the benefit received or to be received in return for the payment.”
So, the loss number shouldn’t be $5,000 – the amount of the bribe – but, rather, the amount of money that the city of West New York lost out on.
The government figured that to be a very high number indeed, based on the accumulation of daily penalties. Mr. Friedman disagreed, and said that number was too inchoate.
The sentencing judge split the baby. He declined to find a loss number, or resolve what the right guidelines are. Instead, the sentencing judge said that thought a sentence of 34 months was about right.
A sentence of 34 months was imposed on Mr. Friedman.
The Third Circuit heard a number of challenges to Mr. Friedman’s conviction. In United States v. Friedman, it rejected them all.
The court of appeals did, however, vacate his sentence and remand for resentencing. After the guidelines were made nonbinding in Booker, the Supreme Court, and then the courts of appeals, set out a procedure for sentencing in a federal case.
First, the district court has to calculate the guidelines. A district court cannot sentence a person in federal court without first determining the appropriate guidelines.
Since that didn’t happen here – the sentencing judge cut to the chase of what it thought a fair sentence is – the court of appeals remanded to do it again.