Supreme Court appears uncomfortable with Percoco bribery case
ALBANY — The U.S. Supreme Court heard oral arguments Monday in an appeal by Joseph Percoco, the disgraced confidant of former Gov. Andrew M. Cuomo who spent several years in federal prison on various bribery convictions before being released last year.
Based on the questions asked and comments made by the justices on Monday, it would appear they could rule in favor of Percoco’s appeal, which argues that he was a private citizen at the time of the scheme and therefore couldn’t be convicted of “honest services” wire fraud, which involves government officials taking bribes.
Percoco, who was so close to Cuomo that the ex-governor treated him like a brother, was convicted in 2018 on honest-services wire fraud and bribery charges related to two business deals he negotiated while he was working on Cuomo’s 2014 re-election campaign, a post he had decided to take after having served for several years as a top aide in the administration.
Monday’s argument was related to only one of the honest-services wire fraud convictions that involved consulting work Percoco did on behalf of a Syracuse real estate development firm, COR Development.
Yaakov Roth, an attorney for Percoco who argued before the justices at Monday’s hearing, said that as a former aide to Cuomo, Percoco may have been understood by others to have decision-making powers in state government, but that was not really the case when the alleged fraud took place.
“What he did have was influence, but none of that creates a fiduciary duty to the public,” Roth said.
COR Development was one of two upstate real estate development firms caught up in the related “Buffalo Billion” bid-rigging case involving Albany Nanotech founder Alain Kaloyeros and two COR executives, Steven Aiello and Joseph Gerardi. Louis Ciminelli, head of the Buffalo development firm LPCiminelli, was also charged and convicted in that case.
The Percoco trial was separate, though the facts in the cases often overlapped.
While on his 2014 hiatus from official government work, Percoco took payments for so-called consulting work that federal prosecutors alleged were actually bribes.
Percoco was accused of receiving $35,000 from COR to try and influence an administrative decision by Empire State Development, the state’s economic development agency, while he was away from his official post in the Cuomo administration running the campaign. At his trial, prosecutors presented ample evidence that Percoco had done campaign work out of Cuomo’s taxpayer-funded government office in Manhattan — a violation of state ethics laws.
Prosecutors said Percoco was asked by COR officials to intervene with ESD to get the agency to drop a requirement that he negotiate a labor deal with unions on a project in Syracuse’s Inner Harbor on Onondaga Lake. ESD eventually dropped the requirement after Percoco intervened.
The justices appeared to side with Roth and Percoco, asking questions about whether or not they thought that a lobbyist or someone who held substantial sway with a top government official, such as a longtime friend, could also be charged under the honest services statute if they did not hold a government position.
The case is now just the latest challenge that could further limit the federal honest-services law, which was passed in the 1980s but has been repeatedly challenged at the Supreme Court. A 2010 decision by the court that whittled back the law resulted in a second trial for former state Senate Majority Leader Joseph Bruno, who had been convicted for honest-services fraud in 2009; the Republican was ultimately acquitted in 2014.
