The U.S. Supreme Court on Thursday unanimously overturned the convictions of two men, including a former top governor’s aide, who were accused of corruption in a high-profile 2018 case related to New York state development projects.
The decision makes it almost certain that other defendants in the case — including Cor Development executives Steven Aiello and Joseph Gerardi — also will have their convictions set aside.
Cor developed Town Centre at Watertown on Route 3 and Beaver Meadows, a 296-unit apartment complex behind the shopping center. It also owns the former Mercy Hospital site in downtown Watertown, although plans to develop residential and commercial units have never materialized. There were no allegations of wrongdoing against Aiello or Gerardi relative to Cor’s developments in Watertown
The Supreme Court on Thursday overturned the felony convictions of Joseph Percoco, a former top aide to Gov. Andrew Cuomo, and Buffalo construction company executive Louis Ciminelli, with both cases being tied to the Cor executives’ convictions as well.
Both Percoco and Ciminelli were prosecuted in 2018, along with seven others, following a sweeping investigation led by then-U.S. Attorney Preet Bharara.
Alexandra Shapiro, an attorney for Aiello and Gerardi, declined to discuss the specifics of their cases until the court issues formal decisions. But she issued this statement:
“We are gratified by the Supreme Court’s rulings in Ciminelli and Percoco. For seven years, Mr. Aiello and Mr. Gerardi have maintained their innocence. They feel greatly vindicated by the Supreme Court’s unanimous decision in both cases, which reverse the judgments previously issued by the Second Circuit Court of Appeals. They wish to thank those who have stood by them and offered their support.”
Percoco was convicted in March 2018 of “honest services fraud” for allegedly accepting a bribe from Aiello in return for helping to get a raise for Aiello’s son and helping Cor Development smooth out a labor issue.
The Supreme Court determined that the instructions to the jury in Percoco’s case failed to properly account for the fact that he was not on the state payroll at the time of the alleged crime. Percoco was accused of taking Aiello’s money while working as Cuomo’s campaign manager.
Aiello was convicted in that trial of “conspiracy to commit honest services fraud.” The court did not issue a ruling on his appeal Thursday, but his conviction will likely be set aside. If Percoco was not guilty of accepting a bribe, it seems unlikely that Aiello can be guilty of giving one.
Ciminelli, the Buffalo developer, was convicted of bid-rigging during a second trial in July 2018, as were Aiello and Gerardi. The Supreme Court Thursday set aside Ciminelli’s conviction, saying the legal theory behind it was invalid.
Ciminelli, Aiello and Gerardi were all convicted based on evidence that they had conspired with government officials to steer lucrative state construction contracts to their companies. The contracts were awarded by Fort Schuyler Management Corp., a nonprofit affiliated with the State University of New York.
Lawyers for the defendants argued that Fort Schuyler suffered no harm — that it got what it paid for. But prosecutors said the scheme deprived the agency of the “right to control” its assets.
The Supreme Court ruled that the “right to control” is not property, which is what federal fraud statutes are intended to protect.
Aiello, 65, and Gerardi, 63, have been free pending their Supreme Court appeals. They were incarcerated for several months last year, until the Supreme Court agreed to hear their appeals in July.
Aiello had been sentenced to three years in prison; Gerardi was sentenced to 2½ years.
The Cor Development contracts at issue in their bid-rigging trial were to build a film hub and a high-tech factory at Collamer Crossings business park in DeWitt. The film hub, now known as the Greater Syracuse Soundstage, is now owned by Onondaga County. The high-tech factory is home to NexGen Power Systems.
Ciminelli was convicted in connection with a contract for his company, LPCiminelli, to build a $750 million factory in Buffalo.
Percoco, 54, was once perhaps Cuomo’s closest aide, and the Democratic governor compared him to family. Cuomo resigned in 2021, bowing to a double-digit deluge of sexual harassment allegations and a scandal related to the counting of COVID deaths.
Cuomo did not immediately respond publicly to the Supreme Court decision on Thursday.
The New York Daily News contributed to this report.
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