Prosecutors rest, then reopen case in Kaloyeros corruption trial

Prosecutors in the Manhattan federal court corruption trial over alleged bid-rigging in Gov. Andrew Cuomo’s upstate economic development projects were given permission to reopen their case after resting Thursday and failing to prove a key technical element on one of the charges.

U.S. District Judge Valerie Caproni granted the unusual request to give prosecutors a second chance to show that some act in an alleged scheme to rig bids between Albany-based SUNY official Alain Kaloyeros and Buffalo builder Lou Ciminelli occurred in the jurisdiction of the Manhattan court.

“I am balancing the public interest in having a jury decide this case…as opposed to the court saying the government messed up, the defense called their attention to it, and they can’t fix it,” Caproni said.

Kaloyeros, 62, of Slingerlands, is charged with working with lobbyist and former Cuomo aide Todd Howe to steer nearly $1 billion in contracts to co-defendants Ciminelli and developers Steve Aiello and Joe Gerardi of Syracuse’s COR Development, major Cuomo donors. Howe worked for Kaloyeros, Ciminelli and COR simultaneously.

The judge’s ruling involved only a wire fraud charge against Kaloyeros and Ciminelli. Defense lawyers also challenged proof of jurisdiction on a conspiracy charge against all four defendants and separate wire fraud charges involving the Syracuse men, but Caproni signaled she would let those charges go to the jury.

The issue marked the latest of several problems prosecutors have faced in the case. When first filed, the charges relied heavily on Howe, who had pleaded guilty and agreed to cooperate.

But after issues about his credibility surfaced during his February testimony at the bribery trial of former Cuomo deputy Joe Percoco, Howe was jailed and eliminated as a witness in the bid-rigging trial.

Also, the government claimed before trial that Howe and Kaloyeros steered contracts to Ciminelli and COR because they were big Cuomo donors. But without Howe, they haven’t been able to get in evidence of contributions, leaving the motive for the alleged scheme murky.

The latest difficulty surfaced Thursday shortly after prosecutors rested their case. Paul Shechtman, Ciminelli’s lawyer, told Caproni that the government had to show that there was an interstate wire that had contact with the Southern District of New York, the Manhattan court’s federal judicial district.

The requirement of a local contact — called “venue” — was missing because most of the emails used as evidence involved Kaloyeros or Howe in Albany and Ciminelli’s company in Buffalo.

After lunch, prosecutors said they had emails between officials who approved the Buffalo project that went to New York City, but had to reopen the case to show they went to out of state servers. Shechtman said they’ll also have to prove the materials were not opened in Brooklyn, which is in a different judicial district from Manhattan.

He also objected to Caproni giving them a do-over on a thin jurisdictional claim that was the justification for his client having to stand trial hundreds of miles from Buffalo.

“We ought to send a message to the government that says if you bring people from this far away, get it right,” he said.

The trial resumes on Monday. Caproni said that after the prosecutors produce their new evidence and defense lawyers put in their case, she will schedule closing arguments after the July 4 holiday week, to begin on July 9.