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State v. Yavorcik

Court of Appeals of Ohio, Eighth District, Cuyahoga

May 10, 2018

STATE OF OHIO PLAINTIFF-APPELLEE
v.
MARTIN YAVORCIK DEFENDANT-APPELLANT

          Criminal Appeal from the Cuyahoga County Court of Common Pleas Case No. CR-14-585428-C

          ATTORNEY FOR APPELLANT David L. Doughten David L. Doughten Co. L.P.A.

          ATTORNEYS FOR APPELLEE Michael C. O'Malley Cuyahoga County Prosecutor Matthew E. Meyer Assistant County Prosecutor Justice Center Mike DeWine Ohio Attorney General Daniel M. Kasaris Senior Assistant Ohio Attorney General

          BEFORE: Laster Mays, J., Keough, P.J., and S. Gallagher, J.

          JOURNAL ENTRY AND OPINION

          ANITA LASTER MAYS, J.

         {¶1} Defendant-appellant/cross-appellee Martin Yavorcik ("Yavorcik") appeals his convictions for one count of engaging in a pattern of corrupt activity, one count of criminal conspiracy, three counts of bribery, one count of tampering with evidence, and two counts of money laundering. The state, plaintiff-appellee/cross-appellant, cross-appeals the trial court's failure to impose a prison term for the first-degree felony conviction. We find that Yavorcik's challenge on the issue of venue has merit and vacate the conviction.

         I. Background and Facts

         {¶2} The case arises from activities that took place in the city of Youngstown, located in Mahoning County, Ohio, between 2005 and 2009. On May 14, 2014, a 73-count indictment was handed down against Mahoning County Commissioner John McNally ("McNally"), [1] Mahoning County Auditor Michael Sciortino ("Sciortino"), and 2008 county prosecutorial candidate Yavorcik. The charges included engaging in a pattern of corrupt activity (R.C. 2923.32(A)(1)) and conspiracy to engage in a pattern of corrupt activity (R.C. 2923.01).

         {¶3} Unindicted individuals who were allegedly part of the criminal enterprise underlying these charges include several prominent Youngstown area business men and women, Cuyahoga County law firms and attorneys, and the following Mahoning County officials and employees:

John Reardon ("Reardon"), County Treasurer to 2007
Lisa Antonini ("Antonini"), County Treasurer succeeding Reardon in 2007
John Zachariah ("Zachariah"), Director of Mahoning County Department of
Jobs and Family Services ("JFS").

         {¶4} The defendants entered not guilty pleas. Multiple counts were dismissed prior to trial. Sciortino and McNally accepted plea agreements the morning of trial. Yavorcik, a licensed Ohio attorney, proceeded pro se during the two-week jury trial that involved 26 witnesses and numerous exhibits. The trial began on March 14, 2016, and the verdict was . Yavorcik was found guilty of:

Count 1: January 1, 2005 to January 1, 2009 - engaging in a pattern of corrupt activity, R.C. 2923.32(A)(1) conspiracy, a first-degree felony;
Count 3: January 1, 2005 to February 1, 2014[2] - conspiracy, R.C. 2923.01(A)(2), a second-degree felony;
Count 8: March 1, 2008 to November 30, 2008 - bribery, R.C. 2921.02(B), a third-degree felony;
Count 9: March 1, 2008 to November 30, 2008 - bribery, R.C. 2921.02(B), a third-degree felony (Yavorcik only)
Count 10: March 1, 2008 to November 30, 2008 - bribery, R.C. 2921.02(B), a third-degree felony (Yavorcik only)
Count 11: October 23, 2008 - tampering with records, R.C. 2913.42(A)(1), a third-degree felony (Yavorcik only)
Count 53: March 20, 2008 - money laundering, R.C. 1315.55(A)(2) (Yavorcik only)
Count 54: September 1, 2008 to September 30, 2008 - money laundering, R.C. 1315.55(A)(2) (Yavorcik only)

         {¶5} The state alleges that a pattern of corrupt activity is demonstrated by two conspiracies. The first conspiracy is commonly referred to as the Oakhill Renaissance conspiracy. The second conspiracy is based on Yavorcik's 2008 prosecutorial campaign.

         A. Oakhill Renaissance

         {¶6} In 1987, JFS leased 96, 000 square feet of space in McGuffy Plaza ("McGuffy Plaza") for $400, 000 per year. McGuffy Plaza was owned by Ohio Valley Mall ("OVM"), a subsidiary of the Youngstown-based Cafaro Company ("Cafaro Co.").

         {¶7} Cafaro Co., founded, owned, and operated by the Cafaro family, operates through a number of subsidiaries and affiliates. Cafaro Co. is one of the largest privately owned retail business development and management companies in the United States. The Cafaro family members relevant to this case are Anthony Cafaro, Sr. ("Cafaro, Sr."), his brother John J. Carfaro ("J.J. Cafaro") and sister Flora Cafaro ("F. Cafaro").

         {¶8} In 2004, Oakhill Renaissance Place ("Oakhill Renaissance"), a commercial building owned by the Southside Community Development Corporation ("SCDC"), was experiencing fiscal difficulty. The Southside Medical Center hospital and several county departments were already located at the building. The SCDC offered to donate the building to the county.

         {¶9} The county refused the offer due to: (1) excessive expenses associated with the hospital operations, (2) extensive repairs were needed, and (3) the building was encumbered by a $440, 000 Ohio Department of Development ("ODOD") loan balance, and $400, 000 in back taxes. (Tr. 1773-1774.) In 2005, Cafaro Co. rejected SCDC's offer to sell them the property. SCDC filed for bankruptcy in May 2006 and the hospital vacated the building.

         {¶10} Without the added expense of the hospital, the county considered purchasing Oakhill Renaissance out of bankruptcy and relocating JFS to the building. According to the state, Cafaro Sr. wanted to prevent the purchase and relocation. Though McGuffy Plaza was in great need of repair, the county was obligated to pay for the repairs under the lease. OVM hired law firms located in Cuyahoga County ("Cuyahoga Firms") to provide legal advice regarding the Oakhill Renaissance bankruptcy.

         {¶11} Mahoning County Commissioners Anthony Traficanti ("Traficanti") and David Ludt ("Ludt") supported the purchase and relocation of JFS to Oakhill Renaissance. McNally, Sciortino, Reardon, and Reardon's successor Antonini were against the move due to the cost of assuming the ODOD lien, remediation expenses relating to the presence of lead and asbestos, the expense of operating a building with thermal heat, and the history of negative cash flow. The opponents generally referred to the facility as a money pit. (Tr. 1316, 1353, and 1598.)

         {¶12} McNally, Reardon, and Sciortino requested that county prosecutor Paul Gains ("Gains"), who represented the county's interests as well as those of the county officials, appoint outside counsel pursuant to R.C. 305.14[3] to assist them with filing objections to the purchase of Oakhill Renaissance from the bankruptcy estate. Gains denied the request and the officials filed suit requesting outside counsel. The denial was ultimately appealed to the court of appeals that ruled against them more than a year after the bankruptcy matter was over and ownership had transferred to the county. (Tr. 1536.)

         {¶13} Denied counsel, McNally and Sciortino, licensed attorneys who lacked bankruptcy law experience, filed pro se objections along with Reardon. Gains filed a motion to strike the objections that was granted by the trial court for lack of standing. Some of the information furnished by the Cuyahoga Firms to OVM was also shared with McNally and Sciortino to assist them with preparing their bankruptcy case objections. The state alleges that the sharing of this information constituted bribery of the public officials by the Cafaros to influence the county's Oakhill Renaissance purchase decision.

          {¶14} On July 27, 2006, the bankruptcy court approved the county's offer to purchase Oakhill Renaissance. Traficanti and Ludt voted to confirm. McNally dissented. McNally, Sciortino, and Reardon appealed the bankruptcy order approving the sale, and the Cuyahoga Firms again provided advisory assistance. The appeal was withdrawn shortly after filing.

         {¶15} On August 7, 2006, OVM filed a taxpayer's suit against the county under R.C. 309.13, [4] the board of commissioners, Sciortino, Reardon, and several county officials including Gains in his capacity as prosecutor. The suit requested rescission of the Oakhill Renaissance purchase. On August 15, 2006, OVM filed suit against the county for breach of the McGuffy Plaza lease agreement. The Cuyahoga Firms represented OVM in both lawsuits as well as during OVM's attempt to intervene in a mandamus action initiated by the county against Reardon and Sciortino. (Tr. 1309.)

         {¶16} Gains represented the county in the breach of lease and the taxpayers suit.[5]The county filed a motion to dismiss on the ground that OVM, as the JFS lessor, had a personal financial interest in the case and therefore, was not a proper representative of county taxpayers in the suit. (Tr. 1802-1803.)

         {¶17} According to assistant county prosecutor Linette Stratford ("Stratford"), OVM refused to respond to the first set of interrogatories and request for production of documents. The county contacted the OVM attorneys of record, the Cuyahoga Firms, and received a 31-page response that included a copy of a February 2, 2006 note "reflecting a telephone conversation between" Carfaro, Sr. and "Zachariah" requesting to "get together with" McNally to "strategize." (Tr. 1839.)

         {¶18} The county obtained authority from the board of commissioners and the court of common pleas to appoint outside counsel in the taxpayers case for McNally, administrator Harry Tablack, Sciortino, Zachariah, and Antonini who assumed the office of treasurer in February 2007. The county served discovery regarding communications between OVM, the Cafaros, and county officials including McNally, Sciortino, Reardon, Zachariah, and Antonini due to concerns raised by attorney-client privilege claims in the discovery responses. The asserted ground for the privilege was that "OVM and their lawyers" "had a common interest" with the public officials named in the county's discovery request. (Tr. 1842.) Stratford explained that "[w]e couldn't understand how" attorneys were communicating "with our clients and us not knowing about it." (Tr. 1843.)

         {¶19} The trial judge ordered the production of responsive information for in camera inspection, as well as requested communications between Carfaro, Sr., J.J. Carfaro, Cafaro Co. in-house counsel James Dobran ("Dobran"), Cafaro Co. representatives, and the Cuyahoga Firms. The information was to be accompanied by an explanation of the legal grounds for the privilege claim.

         {¶20} In March 2007, the trial court issued an opinion addressing the privilege issue, and outlined the documents that were produced for in camera review. The outline was detailed enough to let the county know which items were produced and which were not.

         {¶21} The information that was not subject to privilege was delivered to the county. Also discovered were handwritten notes regarding meetings referenced in the previously produced information to discuss Oakhill Renaissance. According to the county, Cafaro, Sr., McNally, Zachariah, and Sciortino could not recall certain meetings or communications or denied they occurred.

         {¶22} While the trial court deemed OVM to be a proper party to pursue the taxpayers suit, the trial court later ruled against OVM on the merits and the case was appealed. OVM dismissed the appeal in October 2007. The breach of the McGuffy Plaza lease agreement suit was settled at approximately the same time. (Tr. 1906.) The billing records of the Cuyahoga Firms confirm that the matters concluded in early October 2007.

         {¶23} On October 31, 2007, based on information received during discovery in the taxpayer's suit, Gains sent a letter to the Ohio Ethics Commission ("OEC"), reciting deposition excerpts and referencing a number of accompanying documents[6] obtained from the taxpayers suit discovery. Gains suggested that the evidence supported an investigation of McNally, Reardon, Antonini, and Sciortino.

         {¶24} Concurrently, the county sheriff was conducting an investigation into the activities of the alleged enterprise members and the Federal Bureau of Investigation ("FBI") was investigating suspected corruption in Trumbull and Mahoning counties. The organizations joined forces in furtherance of the investigations, ultimately resulting in a number of indictments, including those in the instant case.

         B. Prosecutorial Campaign

         {¶25} At the end of 2007, Yavorcik decided to run for county prosecutor against Gains. Yavorcik, a long time Democrat, ran as an Independent. The state offers this fact as support for the theory that Yavorcik's campaign, supported by a number of Democrats, was motivated by an illegal agreement with the Oakhill Renaissance enterprise members to quash the ethics investigations and criminal indictments if Yavorcik was elected. Thus, Yavorcik also became a target of the agency investigations.

         {¶26} Yavorcik was not shy about sharing his belief that Gains's role in investigating and prosecuting his own clients, the county officials who were actually represented by the office of the prosecutor, was unethical. He also held the opinion that, based on what he had heard and read, the activities that took place regarding Oakhill Renaissance were not illegal.

         {¶27} According to the record, there was no love lost between Yavorcik and Gains. In fact, Gains had a number of political antagonists including members of the Cafaro family and those ultimately indicted as a result of the Oakhill Renaissance investigations.

         {¶28} Yavorcik's political run was unsuccessful and concluded in November 2008. However, his involvement with the alleged enterprise members resulted in the instant case. Yavorcik is accused of being a member of the criminal enterprise who acted "with purpose to commit or promote or facilitate the commission of Engaging in a Pattern of Corrupt Activity" by conspiring to conceal or cover-up the investigation and charges arising from the Oakhill Renaissance conspiracy by accepting campaign contributions as bribes, and omitting or misclassifying information in campaign financial reports. Amended indictment, pg. 21.

         {¶29} Yavorcik's three bribery convictions were for violations of R.C. 2921.02(B) between March 1, 2008 and November 4, 2008, alleging that he:

Count 8: knowingly solicited or accepted money, services to corrupt or improperly influence him regarding the discharge of his official duty "either before or after" being elected or sworn in;
Count 9: knowingly solicited or accepted a $2, 500 campaign contribution from Antonini to corrupt or improperly influence him regarding the discharge of his official duty "either before or after" being elected or sworn in;
Count 10: knowingly solicited or accepted a $2, 500 campaign contribution from Antonini to corrupt or improperly influence him regarding the discharge of his official duty "either before or after" being elected or sworn in.

Amended indictment, pg. 22.

         {¶30} The jury also found Yavorcik guilty of tampering with records on October 23, 2008, by filing an inaccurate 2008 pre-election campaign report. The tampering charge stems from the failure to properly list $15, 000 received from F. Cafaro to be used for a poll to determine Yavorcik's potential election success. Yavorcik deposited the check into his personal account and issued a $15, 000 check for the poll. The poll was listed on the report as an in-kind contribution from Yavorcik. (Tr. 2297.)

         {¶31} In addition to multiple witnesses, portions of audio and video recordings were provided by FBI informant and public relations person Harry Strabala ("Strabala"). FBI agent Wally Sines ("Sines") introduced himself to Strabala in 2002 or 2003 and asked him to be a "listening post" for "issues of public corruption." (Tr. 1004.) In 2005, Strabala became a paid FBI informant and recorded conversations with various public officials and others, some of whom are alleged to be part of the enterprise in this case.

         {¶32} Yavorcik sought Strabala's professional assistance with his prosecutorial campaign and was first recorded on February 28, 2008, the day that he filed his intention to run for office. Strabala was instructed by the FBI to "create conversation" with Yavorcik so that he would "be critical" of Gains and to "try to align" himself with Yavorcik so that Yavorcik "would feel open enough" to discuss matters freely. (Tr. 1013.)

         {¶33} Strabala identified the participants in select excerpts of the FBI surveillance recordings. The technical evidence involved various conversations conducted at functions, restaurants, and meetings. The content introduced for the record focused on Antonini, McNally, Reardon, and others supporting Yavorcik's campaign. Yavorcik publicly and freely acknowledged while seeking petition signatures that he was a long-time Democrat running as an Independent against the Democratic incumbent, Gains.

         {¶34} According to the amended indictment, disbarred attorney Richard Goldberg, a friend of Carfaro, Sr., was "involved with recruiting Yavorcik to run against Gains." Amended Indictment, pg. 4. FBI agent Dean Hassman ("Agent Hassman") testified that Yavorcik, who already knew Goldberg, asked Goldberg to approach Cafaro, Sr. to seek campaign support. Yavorcik ultimately met with Cafaro, Sr. in person to seek support. Cafaro, Sr. informed him that the campaign funds would not be available until the campaign finance report deadline so that the contribution "would not be reflected until after the campaign was over." (Tr. 2271.)

         {¶35} Yavorcik asked Strabala early in the campaign planning how a "527 PAC"[7]works, a question that followed Yavorcik's expression of concern about the possible public political impact of accepting money from the Cafaros. Strabala advised that a "527 PAC" allows contributions without identifying who contributed or how much. Strabala explained that 527 PACs are not illegal and are widely used, including by recent presidential candidates.

         {¶36} There were also discussions of why Yavorcik's supporters disliked Gains and that many attorneys were concerned about supporting Yavorcik against Gains due to potential retribution. The relationship between Gains and the Cafaro family was rather contentious, and the Cafaro family historically supported Gains's campaign opponents, including one launched by a Cafaro in-house attorney several years earlier.

         {¶37} Yavorcik states in the FBI recordings that he did not believe the Oakhill Renaissance activities were illegal, and that it was his opinion that it was unethical for Gains, as prosecutor, to prosecute his own clients, the county officials. The latter opinion is supported by the ultimate request by Gains, a year after the grand jury subpoenas were issued by Gains's office, for appointment of three special prosecutors recommended by Gains to handle the cases due to the conflict of interest. Gains advised that the subpoenas were issued by his office at the request of the OEC.

         {¶38} Gains, who has been prosecutor since 1982, testified that he was a former policeman who was sworn in as prosecutor after the scheduled date because he was shot in his home for refusing to accept "mafia money." (Tr. 1949.) Gains alternately was not aware or could not recall that Yavorcik supported Gains's opponent in the primary, was supported by certain judges, was endorsed by the police union during his campaign, or that he told others regarding Yavorcik, "f**k that punk." (Tr. 2011.) Gains did recall that when Yavorcik applied for a job with his office, he refused to hire him because of the circumstances surrounding Yavorcik's departure from the Youngstown's prosecutor's office.

         {¶39} When working for the city, Yavorcik discovered that the city was arresting people and charging them with a crime on Friday, and those arrested would have to remain in jail through the weekend without arraignment. At the Monday hearing, "the charges would mysteriously disappear." (Tr. 2012.) Yavorcik resigned on a Friday, sued the city the following Monday and later was awarded $10, 000 for legal fees. (Tr. 2011.) Gains stated that Yavorcik was motivated by profit.

         {¶40} Gains has known the Cafaros for years and said that he did not consider the Cafaros to be political enemies but he does not like Cafaro, Sr. Gains admitted that he was angry that Yavorcik entered the campaign and was allowed to remain on the ballot. He felt that Yavorcik's campaign as an Independent was a lie because he was really a Democrat. Gains also denied disliking Yavorcik, saying he had no feelings about him either way.

         {¶41} The $120, 000 amount of the Cafaro contributions was a point of focus by the state. Gains testified that he had never heard of campaign contributions as significant as those made to Yavorcik by the Cafaros, though he admitted that it was not illegal.

          {¶42} Another mainstay of the state's case was that Yavorcik intentionally and expressly cooperated with the asserted cover-up. The county public officials who testified in the case, each of whom were indicted in other cases or in the instant case, testified under plea agreements with transactional immunity and an agreement to cooperate with the prosecution. Every official testified that they "believed, " "thought, " or was "of the impression" that, if Yavorcik was elected, the investigation would stop. This was so in spite of the fact that, as Gains testified, the OEC and sheriffs department were driving the investigation and special prosecutors had been appointed by the court so there would be no conflict of interest by the county prosecutor's office.

         {¶43} Antonini's boyfriend, Michael Kurt Welsh ("Welsh"), also testifying under a plea agreement based on his cooperation in the case, stated that he "believed" Yavorcik would be more favorable than Gains in light of the Oakhill Renaissance investigations, which he labeled as a "witch hunt, " and Welsh's pending legal problems. (Tr. 2171.) Welsh was a heavy drinker and faced multiple DUIs and a felonious assault case.

         {¶44} Welsh talked with Yavorcik about representing him. Welsh was often inebriated, including when speaking with Yavorcik on surveillance recordings. Yavorcik did not represent Welsh in any of his cases. Welsh told the state during his proffer meetings for the current case that he was concerned that if Gains found out that he worked on Yavorcik's campaign, he would be treated unfairly in his pending cases. (Tr. 2198.)

          {¶45} The state also pointed to certain fiscal activities as evidence of corruption and conspiracy such as a campaign finance report entry that listed a $250 campaign donation as a loan. Agent Hassman testified that he has worked in the Youngstown area for 20 years and investigates financial crimes with a focus on public corruption. The FBI, who already had several county officials under investigation, assisted the county sheriffs department and OEC:

The allegations that were surfacing was that a number of public officials started having private concealed contacts with the Cafaro family and the Cafaro lawyers and that those contacts were not transparent and in an adverse position to the official position of Mahoning County who officially had ...

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