U.S. v. SALEMME

91 F. Supp.2d 141 (1999) | Cited 0 times | D. Massachusetts | September 15, 1999

MEMORANDUM AND ORDER

I. SUMMARY ............................................................................ 148

1. The Facts Concerning Defendant Stephen Flemmi's Motion to Dismiss Based on Immunity ............................................................ 148 2. The Motion to Dismiss Based on Immunity ........................................ 163

3. Flemmi's Motion to Suppress the 1984-85 Electronic Surveillance ................ 166 4. DeLuca's Motion to Suppress Concerning the LCN Induction Ceremony .............. 170 5. Conclusion of Summary .......................................................... 172

II. FINDINGS OF FACT ................................................................... 175

1. The Standards Applied .......................................................... 175 2. Rico and Flemmi ................................................................ 176 3. Flemmi as a Fugitive ........................................................... 183 4. The Development of Bulger as an Informant ...................................... 185 5. The FBI Forges the Flemmi-Bulger Partnership ................................... 186 6. Attorney General Levi's Memorandum on FBI Informants ........................... 188 7. Bulger and Flemmi Begin to Perform as a Team ................................... 197 8. Morris Becomes Chief of the Organized Crime Squad .............................. 198 9. The Race-Fix Case .............................................................. 199 10. The FBI Does Not Investigate Bulger or Flemmi .................................. 201 11. The Lancaster Street Garage and 98 Prince Street ............................... 202 12. Sarhatt Extends Bulger and Flemmi As Informants ................................ 207 13. The Wheeler, Halloran, and Callahan Murders .................................... 208 14. The FBI Identified Other Informants for Flemmi and Bulger ...................... 213 15. The South Boston Liquor Mart ................................................... 215 16. Greenleaf Becomes SAC and Ring Becomes Supervisor of the Organized Crime Squad .................................................................. 216 17. The 1984-85 Electronic Surveillance ............................................ 220 18. Morris Tells Bulger and Flemmi That They Can Do Anything They Want as Long as They Do Not "Clip" Anyone ......................................... 242 19. Dining with "Donnie Brasco" .................................................... 244 20. Vanessa's ...................................................................... 244 21 Flemmi Becomes A Top Echelon Informant Again ................................... 248 22. Raymond Slinger ................................................................ 250 23. Bulger and Flemmi Are Protected From Investigation In the Hobart Willis Case .................................................................. 254 24. The Guard Rails at the South Boston Liquor Mart ................................ 255 25. Joseph Murray .................................................................. 256 26. John Bahorian .................................................................. 258 27. The Leak and the Threat to The Boston Globe .................................... 259 28. Flemmi and Salemme ............................................................. 262 29. Mercurio as an Informant ....................................................... 263 30. The LCN Induction Ceremony ..................................................... 269 31. Mercurio as a Fugitive ......................................................... 289 32. The Investigation of Flemmi and Bulger ......................................... 293 33. The Indictment of Bulger and Flemmi and Its Aftermath .......................... 301

III. CONCLUSIONS OF LAW ................................................................. 315

1. Flemmi's Motion to Dismiss or Suppress Based on Immunity ....................... 315 A. The Court is Now Considering Only the Issue of Immunity ...................... 315 B. The Applicable Standards Concerning Immunity ................................. 317 C. Dismissal of This Case Is Not Now Justified Because Flemmi Was Not Promised Immunity From Prosecution ..................................... 321 D. The Issues of Use and Derivative Use Immunity ................................ 325 (1) Flemmi Does Not Have An Agreement Providing Use Immunity Generally For His Statements to the FBI ................................ 326 (2) The Promise of Confidentiality Means Statements to the FBI Which Have the Effect of Identifying Flemmi as an Informant Cannot Be Used Against Him Unless His Defense Makes Them an Issue ............................................................... 326 (3) Flemmi Had an Enforceable Agreement Relating to 98 Prince Street, Vanessa's, and 34 Guild Street ................................. 329 (4) A Hearing Will Be Necessary to Determine If This Case Must Be Dismissed and, If Not, Whether Any Evidence Must be Excluded at Trial ............................................................... 341

(5) If Morris and Connolly Were Not Authorized to Promise Flemmi that the Evidence Intercepted at 98 Prince Street, Vanessa's, and 34 Guild Street Would Not Be Used Against Him, Flemmi's Statements to the FBI Relating to Those Interceptions May Have Been Involuntary and, In Addition, Use of Any Evidence Intercepted At Those Locations May Violate Flemmi's Right to Due Process ................................................... 346

2. The Motion to Suppress the 1984-85 Electronic Surveillance ..................... 351 A. Summary ...................................................................... 351 B. Suppression is Not Justified Based on the Alleged Violation of 18 U.S.C. § 2616(1) ........................................................... 353 C. The Standards to be Applied in Deciding Whether to Suppress for a Failure to Satisfy the Requirements of 18 U.S.C. § 2518(1)(c) Concerning the Necessity for Electronic Surveillance .................................. 358 D. The Necessity Provision of Title III, § 2518(1)(c), is Constitutional in Origin ..................................................................... 364 E. The Motion to Suppress the 1984-85 Surveillance is Meritorious ............... 369 F. A Hearing is Necessary to Identify the Evidence Which Must be Suppressed Because of the Government's Unlawful Conduct Concerning the 1984-85 Electronic Surveillance and to Determine if Any Other Remedy is Required ............................................... 380 3. Flemmi is Not an "Aggrieved Person" With Standing to Seek Suppression of the Interceptions at Vanessa's Under Title III ............................ 381 4. DeLuca Does Not Have Standing to Move to Suppress the Evidence Intercepted at 34 Guild Street For a Violation of Title III Because the 1998 Supreme Court Decision in Minnesota v. Carter Indicates That Although His Conversation was Intercepted, It Did Not Constitute an "Oral Communication" As Defined in the Statute, and DeLuca's Fourth Amendment Rights Were Not Violated ........................................... 384

IV. CONCLUSION ......................................................................... 400

V. ORDER .............................................................................. 401

In 1861, Lord Acton wrote that, "[e]very thing secretdegenerates, even the administration of justice." John EmerichEdward Dalberg Acton, Lord Acton and His Circle 166 (AbbotGasquet, ed., 1968). This case demonstrates that he was right.

I. SUMMARY

1. The Facts Concerning Defendant Stephen Flemmi's Motion to Dismiss Based on Immunity

On January 5, 1995, defendant Stephen Flemmi was arrested on acriminal complaint which charged him, James "Whitey" Bulger, andGeorge Kaufman with conspiring to extort money from a bookmaker,Burton Krantz. Five days later, on January 10, 1995, Flemmi,Bulger, Kaufman, and four other defendants were indicted onmultiple charges of racketeering and extortion, among othercrimes. A complaint authorizing Flemmi's arrest prior toindictment was obtained by the prosecutors because they wereconcerned that Bulger and Flemmi would be informed of theirimminent indictment and flee. This fear was well founded.

Beginning in 1965, Flemmi secretly served as a very valuableand valued confidential informant for the Federal Bureau ofInvestigation (the "FBI" or "Bureau"). In the thirty years priorto his arrest, Flemmi was, among other things, instrumental inthe FBI's successful and acclaimed effort to incarcerate threegenerations of the leadership of the Patriarca Family of La CosaNostra (the "LCN" or "Mafia"). Flemmi had also assisted the FBIin obtaining a warrant that was used to intercept, for the firsttime, an LCN induction ceremony. § II.30.

In 1976, the FBI played a pivotal role in forging a formidable,enduring partnershipbetween Flemmi and Bulger, who had in 1975 also become an FBIinformant. The FBI made Bulger and Flemmi, who were previouslyacquainted but not close, a perfect match. In Boston, Flemmi andBulger uniquely shared an antipathy for the LCN, a desire toprofit criminally from its destruction, and, most notably, thepromised protection of the FBI. § II.5.

As described in detail in this Memorandum, and as summarizedbelow, many members of the FBI participated in honoring thepromise to protect Flemmi and Bulger. Prominent among them wasJohn Connolly, who from 1975 until his retirement in 1990 wastheir FBI "handler." Although retired in 1995, Connolly remainedin contact with his close friends and former colleagues on theOrganized Crime squad in the Boston office of the FBI. As aresult, he learned that Bulger and Flemmi were scheduled to beindicted on about January 10, 1995. Connolly shared thisinformation with Bulger, who, as Connolly expected, became afugitive and also warned Flemmi so that he could flee. Flemmi,however, miscalculated. Not expecting to be charged and subjectto arrest so soon, Flemmi was still in Boston when the criminalcomplaint against him was issued on January 4, 1995. § II.32.

Flemmi's arrest represented a radical departure from hishistoric relationship with the government. At the urging ofAttorney General Robert Kennedy, in the mid-1960's a previouslyreluctant FBI became committed to combatting the LCN. FBI SpecialAgent H. Paul Rico recruited Flemmi to serve as an asset in thateffort, which has since the mid-1960's been the FBI's highestnational priority. Flemmi was, among other things, known to Ricoas a member of the Winter Hill Gang, which was in the midst of aviolent gang war, and as a reputed murderer. Flemmi then hadclose contact with key members of the Patriarca Family, inmeaningful measure because of his partnership with his presentcodefendant Francis Salemme. Although rightly regarded as apotential member of the Patriarca Family, Flemmi did not shareSalemme's unequivocal enthusiasm for the LCN. Thus, Flemmi wasresponsive to the relationship that Rico proposed. § II.2.

Because of Flemmi's ability to provide information concerningleaders of the LCN, Rico caused the FBI to designate him as a TopEchelon informant, the highest status a Bureau source canachieve. Flemmi, however, was never told that he was opened orclosed administratively as an informant. Nor was Flemmi advisedthat any of the information that he was providing was beingmemorialized in writing. Rather, instead of treating Flemmi as acriminal to be dealt with cautiously, Rico successfully sought tocultivate in Flemmi the sense that he was an ally in a commoncause, primarily a war against the LCN. § II.2. This is a sensethat was later nurtured by Connolly, when he succeeded Rico asFlemmi's handler, despite the fact that Connolly too understoodthat Flemmi had committed many serious crimes, including murder.§§ II.5, II.33.

As the alliance between the FBI and Flemmi and Bulgerdeveloped, Flemmi and Bulger were invited to dine periodicallywith members of the FBI engaged in investigating the LCN,including Connolly, several of his colleagues on the BostonOrganized Crime squad, Connolly's supervisors, John Morris andJames Ring, and Joe Pistone, an FBI agent from New York who hadbecome famous for his undercover infiltration of the LCN as"Donnie Brasco." The timing of these dinners suggests that theywere often arranged to celebrate milestones in the FBI'srelationship with Bulger and Flemmi, such as the successfulbugging of the LCN's Boston headquarters at 98 Prince Street in1981, and the frustration of an investigation of Bulger andFlemmi that had been led by the Drug Enforcement Administration(the "DEA") in 1984-85. At these dinners, the agents, Bulger, andFlemmi at times exchanged gifts. Although FBI procedures requiredthat all contacts with informants be documented,there is only one, 1979 report reflecting matters discussed atthese dinners. There is no record of the gifts exchanged. §§II.10, II.11, II.16, II.17, II.18.

Rico made several promises to Flemmi in the course ofdeveloping him as an informant. Among other things, Rico promisedFlemmi that his cooperation would be confidential and that hisservice as a source would not be disclosed to anyone outside ofthe FBI. This was a customary assurance that the FBI has providedto its informants at least since 1965. It is a promise that Ricoand the many other past and present members of the FBI agents whotestified in this case regarded as "sacred." §§ II.2, II.8.

There was good reason for agents of the FBI to believe in theimportance of the promise of confidentiality that is regularlymade by the Bureau to its informants. As the Supreme Court hasrecognized, providing potential sources reasonable assurancesregarding the confidentiality of their cooperation encouragesthem to provide information and protects their safety. Roviarov. United States, 353 U.S. 53, 59, 77 S.Ct. 623, 1 L.Ed.2d 639(1957). Moreover, the FBI Manual has long instructed agents toexercise constant care to assure that an informant's identity notbe disclosed to anyone, intentionally or inadvertently. §§ II.6and III.1.D(3). Strictly adhering to this principle, unlessauthorized by the informant, the FBI has regularly refused toidentify its sources even to prosecutors and other Department ofJustice officials with a legitimate need to know whether, amongother things, subjects of investigations were cooperating withthe FBI and, therefore, might assert, or indeed have, certainforeseeable defenses to prosecution, including that they had beenpromised immunity or authorized to commit acts that wouldotherwise be criminal. §§ II.2, II.17, II.20, II.30, II.32,II.33.

Officials of the Department of Justice have historicallyaccepted the fact that the FBI would refuse any request toconfirm or deny that an individual was an informant. For example,William F. Weld, a former United States Attorney in Boston and aformer Assistant Attorney General in charge of the CriminalDivision, testified that he expected that if he asked the FBI toidentify an informant, he would be told to "go pound sand." §§II.17, III.1.D(3). As a formal reflection of this attitude, in1976, when the Attorney General first issued Guidelines for theFBI to use in exercising its discretion with regard to dealingwith informants, the Guidelines provided no role for the UnitedStates Attorney or the Department of Justice in authorizing aninformant to engage in what would otherwise be criminal activity.They were later revised to require consultation with the UnitedStates Attorney before the FBI authorized an informant to engagein criminal activity that involved a significant risk ofviolence, but stated that any such consultation be conducted in amanner that would not reveal the identity of the source. § II.6.

It was the understanding of the present and former members ofthe FBI who testified in this case that information which Flemmior any other informant provided the FBI could not properly beused against him or, in any event, that it would not be usedagainst him. Thus, it was the consistent practice of the FBI notto use information received from an informant to investigatehim.1 Nor would the Bureaudisclose information provided by a source to any other agency orany prosecutor investigating him. §§ II.2, II.8, II.14, II.16,II.20, II.21, II.33, III.1.D(2)-(3).

While the repeated promises of confidentiality which Flemmireceived were customary and generally regarded as appropriate,Rico also made Flemmi a promise that was irregular, but notunique. He promised Flemmi that if he served as an FBI informant,the Bureau would protect him. § II.2. This is a promise that wasexpressly reiterated and amplified by Connolly and Morris. §§II.5, II.11, II.18. As summarized below, the assurance thatFlemmi would be protected by the FBI was also communicated by theconduct of Rico, Connolly, and Morris, and was confirmed by theactions of many, but not all, of their colleagues in the FBI.

Flemmi, however, was never told that the protection that he waspromised included immunity from prosecution. The word "immunity"was never mentioned. §§ II.2, II.5, II.16. Flemmi understood thatit was permissible for agencies other than the FBI, or FBI agentsignorant of his relationship with the Bureau, to investigate him.He also knew that he could properly be prosecuted if any suchinvestigation succeeded despite the best efforts of his FBIhandlers to protect him. §§ II.2, II.9, II.17, II.32, III.1.C.

Relying upon the promises made to him by the FBI, and on therepeated performance of those promises, Flemmi renderedexceptional service in the Bureau's war against the LCN and othermatters. In the 1960's, Flemmi regularly provided information,that Rico rated as "excellent," regarding the activities ofRaymond L.S. Patriarca, and other members and associates of theFamily that bore his name, including Gennaro Angiulo, IllarioZannino, who was also known as Larry Baione, and Salemme. Flemmiwas also instrumental in Rico's successful effort to develop LCNmember Joseph Barboza into a cooperating witness. Barboza'stestimony led to the convictions of Patriarca and several of hisassociates, and earned him national renown. In addition, in themid-1960's, Flemmi furnished Rico with an appreciated warning ofa threat to the life of Suffolk County District Attorney GarrettByrne. § II.2.

In 1969, Rico told Flemmi that he and Salemme would soon beindicted for the attempted murder of Barboza's lawyer, JohnFitzgerald, and suggested that they flee. Flemmi and Salemmeacted on that advice. While a fugitive, Flemmi stayed in touchwith Rico. Rico, however, did not tell the agents responsible forthe Flemmi fugitive investigation that he had spoken to him. Itappears that after separating from Salemme because of a series ofdisagreements, Flemmi told the FBI where Salemme could be found.Thus, Connolly was able to apprehend Salemme in New York. §§II.2, II.3.

After Salemme was convicted of the Fitzgerald bombing andincarcerated to serve a lengthy sentence, at Rico's requestFlemmi returned to Boston in 1974. As Rico promised, Flemmi wasimmediately released on bail and the charges against him weredropped. § II.3.

In 1975, with assistance from Bulger, Connolly revived Flemmi'srelationship with the Bureau. Flemmi promptly proved hiscontinued value as a source. After Barboza was murdered in 1976,Flemmi provided information that permitted Connolly to convert acoconspirator into a cooperating witness who identified PatriarcaFamily member Joseph Russo as Barboza's killer. In 1992, Russopled guilty to that charge and was sentenced bythis court to what turned out to be life in prison. § II.7.

In 1980, Flemmi provided Connolly with information concerningthe assassination of federal Judge James Wood by a group of majordrug dealers. Connolly later advised his superiors that hebelieved that the contacts Flemmi had made at his direction inthat investigation may have created the false impression thatFlemmi was involved in narcotics. § II.11.

In 1980, Flemmi and Bulger made a critical contribution to theFBI's ambitious and ultimately successful effort to bug Angiulo'sheadquarters at 98 Prince Street. The location was viewed asvirtually impenetrable. Connolly and Morris asked Flemmi andBulger to visit 98 Prince Street and obtain information importantto the physical feasibility of the proposed bugging. Bulgerjustifiably feared that he and Flemmi might be killed if theywent to that location. Flemmi expressed the additional concernthat the bugging of 98 Prince Street would likely result in theinterception of information concerning criminal activity in whichhe and Bulger were engaged. Morris and Connolly, however, assuredFlemmi and Bulger that the 98 Prince Street tapes would not be aproblem for them; they would be protected for anythingintercepted at 98 Prince Street rather than prosecuted. Thus,Flemmi reasonably understood that if he assisted the FBI, none ofthe evidence intercepted at 98 Prince Street would be usedagainst him, directly or indirectly. §§ II.11, III.1.D(3).

As a result of the promises made by Morris and Connolly, Flemmiwent with Bulger to 98 Prince Street, and returned with a diagramof the premises and the other information that the FBI hadrequested. Subsequently, Bulger and Flemmi were two of theinformants relied upon in the application for the warrant whichwas issued authorizing the installation of a bug at 98 PrinceStreet. Id.

In 1991, Morris assessed for his superiors Flemmi's value as aninformant, writing that the information Flemmi provided had beenutilized in six successful applications for electronicsurveillance, involving, among other things, the two highestpriority Organized Crime investigations in Boston. The 98 PrinceStreet investigation, Morris wrote, "is one of the highestpriority organized crime cases in the FBI today and involves whathas been characterized by [FBI Headquarters] officials as one ofthe most important and successful Title IIIs to have beenconducted by the FBI in the past ten years." Id.

In 1985, at a dinner at Morris' home, in Connolly's presence,Morris again told Flemmi and Bulger that they would not beprosecuted for anything on the 98 Prince Street tapes. Inaddition, Morris told them, "you can do anything you want as longas you don't `clip' anyone." § II.18.

Morris' 1981 assessment of the value of the 98 Prince Streettapes to the FBI proved to be accurate. With continued assistancefrom Flemmi and Bulger, the FBI used the evidence interceptedthere to develop a case which secured the convictions, in 1986,of Angiulo, Zannino, and much of the rest of the leadership ofthe LCN in Boston. §§ II.12, II.20.

Following those convictions, Flemmi quickly contributed to theFBI's effort to incarcerate the next generation of the leadershipof the LCN in Boston, including Russo, Vincent Ferrara, andRobert Carrozza. Flemmi reported that the emerging leaders of theLCN were meeting regularly in a storeroom at Vanessa'sRestaurant, which was owned by Angelo "Sonny" Mercurio, who hadrecently been released from prison. § II.20.

The FBI targeted Vanessa's for electronic surveillance. Onceagain, Flemmi was tasked to obtain vital logistical informationand performed his mission. Flemmi and Bulger were later two ofthe three sources relied upon in the application for a warrant tobug Vanessa's. Before being discovered in 1987, the bugintercepted, among other things, a dramatic extortionof two elderly bookmakers, "Doc" Sagansky and Mo Weinstein, whichFlemmi had told the FBI was being planned. As a result, theBureau developed a powerful case against Ferrara, Carrozza,Mercurio, and a number of their confederates. Id.

At Connolly's request, in 1988, Flemmi began to provideinformation again on Salemme, who had recently been releasedafter serving fifteen years in prison for the Fitzgerald bombing.Raymond J. Patriarca had by then succeeded his deceased father asBoss of the Family. In early June 1989, Flemmi reported thatPatriarca had given his "blessing" to Salemme to assumeleadership of the LCN in Boston when, as anticipated after asearch warrant was executed at Vanessa's, Russo, Ferrara, andtheir crew were indicted. Flemmi also kept Connolly up to date onthe substantial and escalating risk that the Russo faction of theLCN might soon try to murder Salemme. §§ II.28, II.29. Inaddition, Flemmi contributed to the FBI's successful effort totarget Salemme for electronic surveillance at the Busy Beerestaurant. § II.28.

Flemmi and Bulger also contributed to the recruitment ofMercurio as a Top Echelon informant.2 As they explained toConnolly, Mercurio was disenchanted with the LCN, close to Bulgerand Flemmi, and planning to flee rather than return to prison asa result of the bugging of Vanessa's. Employing a profileprovided by Flemmi and Bulger, Connolly and Ring developedMercurio into a very valuable source, who, among other things,made it possible for the FBI to bug the LCN induction ceremonyconducted on October 29, 1989, at 34 Guild Street in Medford,Massachusetts. §§ II.29, II.30.

Connolly retired from the FBI in 1990. As a result, withouttheir knowledge, Flemmi and Bulger were closed administrativelyas FBI informants. Flemmi, however, was then characterized ashaving "furnished the Boston Division [of the FBI] very valuableinformation through the years regarding LCN activities." Ex. 44.The Bureau did not want to lose Flemmi and Bulger as sources whenConnolly retired and, therefore, reported that it was consideringoptions to reopen them. Although not assigned a new handler,Flemmi continued to provide, through Connolly, information thatthe FBI was seeking concerning the LCN. That information includedthe numbers of the telephones used by Salemme's brother Jack,which the Bureau wished to tap as part of its investigation ofSalemme. § II.32.

As indicated earlier, Rico, Connolly, and Morris each toldBulger and Flemmi that he would be "protected" in return forserving as an informant. §§ II.2, II.5, II.18. The conduct ofRico, Connolly, Morris, and many but not all of their colleaguesat the FBI, expressed even more clearly thantheir words the FBI's agreement to protect Flemmi.

Rico told Flemmi about other individuals who were cooperatingwith law enforcement so that Flemmi could be careful around them.§ II.14. As described previously, in 1969, Rico advised Flemmithat he and Salemme would soon be indicted and suggested thatthey flee promptly. § II.2. In addition, as Rico promised, Flemmiwas immediately released on bail and the fugitive charges againsthim were dismissed when Flemmi followed Rico's advice andreturned to Boston in 1974. § II.3.

Connolly and Morris, individually and in tandem, also actedrepeatedly to protect Flemmi. In 1977 or 1978, Connollyintimidated executives of National Melotone from pursuing theircomplaint that Bulger and Flemmi were extorting the vendingmachine company's customers. § II.7. In early 1979, with theirsources' consent, Morris and Connolly told Strike Force AttorneyJeremiah O'Sullivan that Flemmi and Bulger were valuableinformants and persuaded him, with the agreement of Thomas Daly,the FBI agent who was leading the investigation, not to indictthem in a race-fix case, in part so that Bulger and Flemmi couldcontribute to the FBI's effort to bug 98 Prince Street. § II.9.In 1979, Morris received reports from informants that Bulger andFlemmi were shaking down bookmakers, but no investigation wasconducted. § II.10.

In 1980, Connolly informed Bulger and Flemmi that the LancasterStreet Garage had been bugged as part of a Massachusetts StatePolice investigation or confirmed that fact for them. Also in1980, Flemmi and Bulger were told when the bug at 98 PrinceStreet was installed and when it was removed so that they wouldnot be intercepted. § II.11.

In 1982, Morris caused Connolly to tell Flemmi and Bulger thatBrian Halloran was cooperating with the FBI and had implicatedthem in the murder of Roger Wheeler, the President of World JaiLai. About two weeks later, Halloran was killed.3 Morrisbelieved that Bulger and Flemmi were responsible for Halloran'sdeath, but did not disclose to the agents investigating it thatthey had been told that Halloran was cooperating with the Bureau.§ II.13.4

In an effort to protect Bulger and Flemmi, Morris and Connollyalso identified for them at least a dozen other individuals whowere either FBI informants or sources for other law enforcementagencies. One of them may have been John McIntyre. McIntyredisappeared about six weeks after he told the FBI and severalother law enforcement agencies that Bulger was engaged in illegalactivity, and that Bulger's associate Patrick Nee was involvedwith the Valhalla, a ship that was captured running guns to theIrish Republican Army. McIntyre was planning to meet with Nee thenight that he disappeared. § II.14.

In 1984, Connolly received reliable information that Bulger andFlemmi were engaged in an ongoing extortion of Stephen and JulieRakes to obtain control of a liquor store that came to be knownas the South Boston Liquor Mart. Connolly neither recorded theinformation nor conducted any investigation. He did, however,share the information that he had received with Bulger. § II.15.

As summarized more fully below, in 1984, Connolly also warnedFlemmi and Bulger of an investigation targeting them that wasbeing led by the DEA. He subsequently told them that as part ofthat investigation a wiretap had been placed on the telephone oftheir colleague Kaufman. § II.17.

In 1986, after tasking Flemmi to acquire information vital tothe FBI's effort to bug Vanessa's, Connolly told him when the bugwas installed so that Flemmi would not be intercepted. Connollylater told Flemmi when the bug had been removed. § II.20.

In 1988, Connolly advised Flemmi that a Boston PoliceLieutenant, James Cox, would be wired and would attempt to engageFlemmi in incriminating conversation. § II.26.

Also in 1988, Morris had Connolly warn Flemmi and Bulger tostay away from John Bahorian, whose telephone was about to betapped by the FBI in an effort to acquire evidence againstFlemmi, among others. Morris also told Connolly to tell Bulgerand Flemmi not to do anything to Bahorian because he "did notwant another Halloran." Morris later reiterated both of thesewarnings directly to Bulger and Flemmi. He also told Flemmi thathe could keep him out of any indictment arising from the Bahorianelectronic surveillance. Although Bahorian and others wereultimately indicted, Flemmi was not. Id.5

In 1988 or 1989, Connolly told Bulger that Timothy Connolly wascooperating with the FBI and would try to record conversationswith Bulger and Flemmi. Bulger passed this warning on to Flemmi.§ II.28.

After providing Connolly information to assist in the FBI'seffort to recruit Mercurio as an informant, Flemmi was told whenthat initiative had succeeded. § II.29.

Following his retirement in 1990, Connolly used his continuingconnections with his close friends and former colleagues on theOrganized Crime squad to obtain information concerninginvestigations that might have resulted in charges against Bulgerand Flemmi. Connolly regularly shared the information he acquiredwith them, including the scheduled date for the indictment ofBulger and Flemmi in this case. § II.32.

While Rico, Morris, and particularly Connolly were at the hubof the protection promised and provided to Flemmi, many of theircolleagues and superiors in the FBI also contributed by theirconduct to that promise and to its fulfillment.6

In 1977, Daly and Special Agent Rod Kennedy were told byFrancis Green that Bulger and Flemmi had threatened to kill himin connection with their attempt to collect a debt, but no effortwas made to develop the reluctant Green as a witness againstthem. § II.7. As described earlier, in 1979, Daly later joinedO'Sullivan in agreeing not to charge Bulger and Flemmi in therace-fix case. § II.9.

In 1982, the Boston FBI agents aware of Halloran's cooperationdid not tell their colleagues in Oklahoma City, who had expressedinterest in him, that Halloran was available to be interviewed.When agents from Oklahoma City sought to interview Bulger andFlemmi, ASAC Robert Fitzpatrick successfully opposed thisrequest, in part by falsely claiming that he had interviewedBulger about the matter. § II.13.

In 1984, Sean McWeeney, the Chief of the Organized CrimeSection at FBI Headquarters, told Connolly that the DEAwas leading an investigation targeting Bulger and Flemmi.Connolly shared this information with his sources. § II.17.

In 1988, Rod Kennedy, John Newton, their supervisor BruceEllavsky, and ASAC Larry Potts provided Bulger and Flemmiprotection concerning an ongoing extortion of Raymond Slinger.Although Slinger was willing to wear a recording device andtestify against Flemmi and Bulger, after Ellavsky consultedPotts, the information that he provided was neither documentednor investigated. Instead, Bulger was told that Slinger hadspoken to the FBI. § II.22.7

Bulger and Flemmi were also protected by the FBI in thesuccessful investigation of drug dealer Hobart Willis and others.Although in 1986 and 1987, Ellavsky and James Blackburn, Jr.received increasingly specific information that Bulger wasextorting Willis, after Connolly was consulted no investigationof Bulger was conducted. Nor was the information that the FBI hadreceived concerning Bulger shared with the other agenciesinvolved in the joint investigation of Willis. § II.23.

Similarly, in 1987, when James Lavin obtained photographs andother information indicating that City of Boston employees hadillegally erected guardrails on the private property of the SouthBoston Liquor Mart, he consulted Connolly. After being advisedthat Bulger was a valuable informant, Lavin made no record of theinformation he had received and conducted no investigation. §II.24.

In 1989, Joseph Murray, an incarcerated drug dealer understoodto be closely connected with Bulger, alleged that Connolly andNewton were selling information about electronic surveillance toBulger and Flemmi. Murray also claimed to know of a witness whosaw Bulger participate in the Halloran murder. However, wheninterviewed by Edward Quinn and Edward Clark in 1989, Murray waseither not asked about his allegations concerning Connolly andNewton or his responses were not recorded in the notes and FBIreport of the interview. ASAC Dennis O'Callahan, however,subsequently prepared a memorandum, which Ahearn sent to FBIHeadquarters, stating that Murray's allegations wereunsubstantiated. In addition, Murray evidently was not questionedin detail about the information he indicated that he hadconcerning Bulger's role in the Halloran murder. Moreover, theinformation Murray did provide was not given to the FBI agentsresponsible for the Halloran murder investigation or indexed in away that would permit them to find it. Nor was any effort made toemploy the willing Murray as a source of information to be usedagainst Flemmi, Bulger, or anyone else. § II.25.

Finally, as indicated earlier, members of the Organized Crimesquad kept Connolly advised of at least some developments in theinvestigation of Flemmi and Bulgerthat was initiated after Connolly retired. Connolly used thatinformation to honor his promise to protect Bulger and Flemmi. §II.32.8

After Connolly retired, in about 1992, the United StatesAttorney's Office began a grand jury investigation of Bulger andFlemmi. Agents from the FBI Organized Crime squad participated inthe investigation. At least six of the agents who testifiedbefore the grand jury knew that Bulger and Flemmi had been FBIinformants. Several of them had read all or parts of Flemmi's andBulger's informant files before testifying. In addition, contraryto the promises made to Flemmi explicitly concerning 98 PrinceStreet and implicitly concerning 34 Guild Street, evidenceintercepted at those locations was presented to the grand jurieswhich indicted him. § II.32.

In 1992, the FBI refused a request by the then United StatesAttorney Wayne Budd, and his assistants, to confirm that Bulgerwas an informant or to permit them to review Bulger's informantfile. The prosecutors were concerned about the implications fortheir investigation if Bulger was, or had been, an FBI informant.Among other things, they wished to address the foreseeable issuesof immunity and authorization now raised by Flemmi, whose historyas an informant would have been revealed if Bulger's had beendisclosed. Id.

On October 25, 1994, the original indictment in this case wasreturned against defendant Robert DeLuca. It charged him withparticipating in the October 29, 1989 LCN induction ceremony. Theindictment was evidently obtained because the five-year statuteof limitations was about to expire. DeLuca was not immediatelygiven notice of the indictment. Rather, it was sealed andrandomly assigned to this court. Id.

On about December 22, 1994, in anticipation of the imminent,additional charges in this case, the United States Attorney'sOffice again asked the FBI if Bulger was an informant,emphasizing its need to know because the government would soonhave to disclose exculpatory information to Bulger and hiscodefendants. Once again, the FBI resisted this request. TheBoston Office of the Bureau urged FBI Headquarters to continue tosupport its opposition to telling the United States Attorney thatBulger had been an informant. It argued that it was not expectedthat the issue of Bulger's informant status would be raised byBulger or his codefendants and, in any event, that no judge wouldcompel disclosure of his status if the issue were raised. Id.

However, the FBI's Principal Legal Adviser in Boston, JohnMichael Callahan, examined the Bulger and Flemmi files with aview to determining if they contained information which would beexculpatory in the context of their forthcoming indictment.Callahan focused on the issues raised by the United StatesAttorney's Office, including whether Bulger and Flemmi had beenauthorized to engage in conduct which would otherwise becriminal, whether they had been explicitly or implicitly promisedany form of immunity, and whether Bulger and Flemmi "had providedinformation to the FBI which would undercut a central theme ofthe indictment, namely, that there was a close workingrelationship between La Cosa Nostraand the Winter Hill Gang." Ex. 271; § II.32.

After completing his review, Callahan concluded that Flemmi hadbeen "at least tacitly authorized" by the FBI to participate in"illegal gambling" and "LCN policymaking." The FBI recognizedthat the Flemmi and Bulger informant files contained informationthat would be exculpatory in the context of the imminent charges.The Bureau also realized that the failure to tell the UnitedStates Attorney that Bulger and Flemmi had been informants, andto provide the prosecutors with relevant materials, "could wreckthe proposed organized crime indictments scheduled to be returnedon January 9, or January 10, 1995." Id.

Accordingly, on January 9, 1995, the FBI told United StatesAttorney Donald Stern, and two of his assistants who were notdirectly involved in the investigation, that Bulger and Flemmihad been informants. The FBI also provided what Callahancharacterized as a "quick general overview of the kind ofinformation" that he had discovered. Id. Stern did not,however, insist that the prosecutors handling the case, or anyoneelse outside the FBI, review the Bulger and Flemmi informantfiles before the indictment previously prepared was presented tothe grand jury. Nor did Stern share the information that he hadreceived with the prosecutors who were presenting the case to thegrand jury, evidently because he recognized the risk that theirdisqualification might be required if they were exposed toinformation acquired from Bulger or Flemmi as a result of anypromise of immunity. Id.

Thus, the indictment that was previously prepared and approvedwas presented to the grand jury on January 10, 1995, byprosecutors who "did not know that Bulger and Flemmi had beeninformants or of any assessment of the information in theirinformant files." Ex. 269; § II.32. Those charges were broughtagainst six more defendants in a ninety-one-page SupercedingIndictment of the original charges against DeLuca. Therefore,pursuant to the District Court's well-known procedures concerningsuperceding indictments, the greatly expanded case was notrandomly drawn, but rather was assigned to this court. Thus, thegovernment exercised what was in effect an option offered by theDistrict Court's rules to select this court to preside in thecase against Bulger, Flemmi, and their original codefendants,Francis Salemme, Francis Salemme, Jr., Robert DeLuca, GeorgeKaufman, and James Martorano. § II.32.9

The First Superceding Indictment charged the defendants with,among other things, from 1969 to January 1995, engaging in aconspiracy to violate, and violating, the RICO statute. They werealso charged with conspiring to extort, and extorting,bookmakers, from 1979 to 1994. § II.33.

With regard to the RICO charges, the alleged enterprise wasneither the Patriarca Family of La Cosa Nostra nor the WinterHill Gang, organizations that have, in effect, been proven to beRICO enterprises in prior prosecutions. Rather, the defendantswere alleged to have been part of a unique association-in-factenterprise made up of individuals who joined together to usetheir respective relationships with either the Patriarca Familyor the Winter Hill Gang to, among other things, facilitate theunlawful activities of the enterprise and coordinate theactivities of the Patriarca Family and the Winter Hill Gang.Id.

In view of the roles of Bulger and Flemmi as Top Echeloninformants utilized to provide, and in some instances tasked toobtain, information for the FBI concerning the LCN, there is nowa serious question presented concerning whether they wereauthorized to engage in the conduct alleged to be criminal andare, therefore, not guilty as charged. There are also questionsrelevant to all of the defendants regarding whether the allegedconspiraciesand enterprise genuinely existed, because an agreement withsomeone acting as an agent of law enforcement is not a criminalconspiracy. These questions, however, must be addressed at trial.§§ II.33, III.1.A. It is the issue of immunity that the courtmust decide in these pretrial proceedings. §§ III.1.B, C,D(1)-(5).

All of these issues, however, present serious impediments tothe successful prosecution of this case. If the United StatesAttorney and other officials of the Department of Justice hadbeen properly informed before the proposed indictment of Bulgerand Flemmi was presented to the grand jury, perhaps Bulger andFlemmi would not have been charged at all, or different, morenarrow charges might have been fashioned in an effort to reducethe risk that their indictment would prove to be fatally flawed.It is inconceivable to this court, however, that the case againstFlemmi and Bulger as indicted in January 1995, would have beenbrought by any reasonable prosecutor who was properly informed oftheir relationship with the FBI.

The pending charges against Flemmi and Bulger were broughtwithout anyone outside the FBI reviewing Flemmi and Bulger'sinformant files or considering carefully the issues that theyraised. It was not until July 1995, that a member of the UnitedStates Attorney's staff first read those files. The prosecutorsin this case were subsequently told that Bulger and Flemmi hadbeen FBI informants. They were not, however, then provided withany additional information because of an enduring fear that ifthey knew more, their disqualification would be requested, if notrequired. § II.33.

In August 1995, the government advised the magistrate judge,ex parte, that Flemmi had made potentially relevant statementsto the FBI in the context of a confidential relationship over thecourse of many years. The government reported that Department ofJustice officials would review the relevant files and would seekguidance from the magistrate judge concerning the government'sdiscovery obligations. Although in September 1995, this courttold the parties that it understood that there were no matterspending before the magistrate judge and would decide all futureissues itself, the government continued to secretly seek rulingsfrom the magistrate judge relating to the implications fordiscovery of Flemmi's service as an informant. Id.

In the fall of 1995, representatives of the Department ofJustice and of the United States Attorney's Office who were notthen on the prosecution team for this case, informed themagistrate judge, in sealed ex parte submissions, that Callahanhad concluded that the FBI had "at least tacitly authorized[Flemmi's] participation" in "illegal gambling and in LCNpolicymaking," but that "very little in the Flemmi and Bulgerfiles is even arguably Brady material." The magistrate judgeagreed with this erroneous assessment. Nevertheless, thegovernment recognized that Flemmi was entitled to certaindocuments that were in his informant file. As requested by thegovernment, in December, 1995, the magistrate judge ordered thatthose documents be furnished to Flemmi directly, rather than tohis attorney. Id.

The government, however, did not comply with this Order. Flemmidid not receive any of the documents the government had beendirected to produce to him. If those documents had been promptlyprovided to Flemmi, he would, in 1995 or early 1996, have learnedfor the first time that the FBI had documented some of theinformation that he and Bulger had furnished. Id.

During 1995 and 1996, this court decided many pretrial matters.Among other things, Flemmi was denied bail; the government wasallowed to obtain another superceding indictment to addressdefects identified by defendants' motion to dismiss; chargesagainst an additional defendant, John Martorano, were brought intheFlemmi case and later alleged instead in what the court deemed tobe a separate indictment; and motions to suppress the electronicsurveillance conducted at the Busy Bee restaurant were denied,after evidentiary hearings, despite proven defects in obtainingthe warrants and in sealing the tapes. Id.10

In March 1997, the defendants moved for evidentiary hearings ontheir motions to suppress certain electronic surveillanceevidence, including the electronic surveillance conducted jointlyby the DEA and FBI in 1984-85, and by the FBI at 34 Guild Streetin 1989. In connection with these motions, each of thedefendants, with the significant exception of Flemmi, moved fordisclosure of whether Bulger, Mercurio, Robert Donati, and otherindividuals were FBI informants. Flemmi joined in all of themotions except for the request concerning Bulger. Id.

With the agreement of the parties, because the motionsimplicated the safety of suspected informants, the submissionsand hearings on the motions were initially closed to the public.The government strenuously opposed the requests for evidentiaryhearings on the motions to suppress and the related requests toconfirm or deny that Bulger, Mercurio and/or Donati wereinformants. In the course of the proceedings the court discoveredthe sealed submissions indicating that Flemmi and Bulger had beeninformants. With the consent of all counsel, the court consultedFlemmi privately. Flemmi immediately decided to disclose to hisattorney and his codefendants that he had been an FBI informant.Id.

On May 22, 1997, the court issued a decision granting therequests for evidentiary hearings on the motions to suppress andordering that the government reveal whether Bulger, Mercurio,and/or Donati were informants. At the request of the government,the decision was sealed to permit the Acting Deputy AttorneyGeneral to decide whether the government would comply with theOrder concerning Bulger, Mercurio, and Donati, dismiss the case,or be held in civil contempt in an effort to render the decisionappealable. Id.

It was then foreseeable that, if the government did not dismissthis case, Flemmi's history as an informant would soon bedisclosed publicly and that Bulger's status as a source would berevealed by Flemmi or, since they were virtual Siamese twins, beeasily inferred. In response to the May 22, 1997 Memorandum andOrder, the government, in a sealed submission, confirmed thatBulger had been an informant and, contrary to its previousposition, conceded that there was a proper basis for the court tohave ordered evidentiary hearings on the motions to suppress theelectronic surveillance conducted in 1984-85 and at 34 GuildStreet. Id.

Demonstrating again the Department of Justice's traditionaldeference to the FBI in matters concerning the confidentiality ofits sources, however, the Acting Deputy Attorney General declinedto obey the Order to confirm or deny whether Mercurio and/orDonati were informants who hadassisted the government concerning the electronic surveillanceconducted at 34 Guild Street. At that point the May 22, 1997Memorandum and Order was unsealed.11 Id.

The defendants moved to have the Acting Deputy Attorney Generalheld in civil contempt. Thus, he was at risk of beingincarcerated until he complied with the court's Order concerningMercurio and Donati. Nevertheless, he repeatedly refused to doso. When questioned by the court, however, Mercurio acknowledgedthat he had been an informant. The Department of Justicesubsequently represented that the deceased Donati had not been asource. Thus, the motion to hold the Acting Deputy AttorneyGeneral in contempt became moot. Id.

In connection with the pending motions to suppress, Flemmifiled several increasingly specific affidavits describingpromises of protection that he had received from the FBI andinstances of those promises being performed. Flemmi alleged,among other things, that Morris had told him and Bulger that theycould be involved in any criminal activities short of murder andwould be protected by the FBI; that he had been tipped off to theindictment in this case so that he could flee if he wished to doso; and that Mercurio had also been given prior notice of hisindictment and, therefore, had been able to become a fugitive.Id.

In late June 1997, the court ordered that the governmentdisclose to the defendants information relating to the pendingmotions. Thus, a great many documents which the FBI expectedwould never be seen by anyone outside the Bureau were producedand, in many instances, made part of the public record.12Id.

In addition, pursuant to Federal Rule of Criminal Procedure12.3(a)(1), Flemmi was required to provide notice of hisintention to assert as a defense at trial that conduct alleged tobe criminal was actually authorized by the FBI. At thegovernment's request, the defendants were also ordered to filetheir foreseeable motions to dismiss and supporting affidavits,so that any hearingsgranted on those motions could be conducted in conjunction withthe hearings on the related motions to suppress. The courtallowed Flemmi's request for an evidentiary hearing on his motionto dismiss because of purported promises of immunity. It denied,without prejudice to later consideration, the defendants' requestfor evidentiary hearings on their motions to dismiss on othergrounds, including alleged outrageous government misconductconstituting a denial of their rights to Due Process.

The hearings ordered were held throughout 1998. They generatedover 17,000 pages of transcripts and 276 exhibits. The court'sfindings of fact are detailed in this Memorandum. Its conclusionsof law are also described in detail, and are summarized below.

2. The Motion to Dismiss Based on Immunity

Flemmi's motion to dismiss based on an alleged promise ofgeneral immunity from prosecution is not meritorious. § III.1.C.Further proceedings will be required, however, to determinewhether Flemmi is entitled to dismissal because evidence that hewas properly promised would not be used against him was presentedto the grand juries which returned the indictments in this case.§ III.1.D.(2)-(4). As summarized below, it would also have beenillegal for evidence derived from the 1984-85 electronicsurveillance to have been presented to those grand juries. Futureproceedings will also be required to determine whether thisoccurred. If evidence derived from the 1984-85 electronicsurveillance was presented to the grand juries that indictedFlemmi, the court will have to decide if that unlawful use ofintercepted evidence requires, or contributes to requiring,dismissal of the case against Flemmi. § III.2.F. In addition, thefurther hearings will permit the court to identify the evidencewhich must be excluded at trial if the case against Flemmi is notdismissed.

Flemmi did not have an agreement that he would not beprosecuted in return for his service as an FBI informant. The FBIagents primarily responsible for dealing with Flemmi, by word anddeed, for thirty years, promised Flemmi protection in return forthe valuable information that he was providing. The conduct ofmany other members of the FBI, including at least three ASACs,and the Chief of the Organized Crime Section at FBI Headquarters,contributed to creating, communicating, and performing thepromise of protection to Flemmi. Flemmi reasonably relied on theFBI's promise of protection and, in return for it, provided veryvaluable assistance to the government in its war against the LCNand other matters. § III.1.C.

Flemmi was not, however, explicitly or implicitly promisedimmunity from prosecution. The term immunity was never used inconversation with him. More importantly, Flemmi did notunderstand that the government, or any of its agents, had agreedthat he would not be investigated by the FBI, or any other lawenforcement agency, or not be prosecuted. Rather, he expectedthat the FBI would overlook some of his criminal activity,provide him information concerning any investigations that wereconducted, and warn him of any imminent charges against him ofwhich it learned. The FBI performed its part of the bargain.Thus, it is not necessary or appropriate to decide if the agentsentering into this agreement were authorized to do so, or whetherthe agreement was not valid because it violated public policy orbecause it attempted to provide immunity for future criminalconduct. Id.

In addition, the mere fact that Flemmi was an informant doesnot mean that nothing that he said to the FBI could be usedagainst him in any way. § III.1.D(1). However, the FBI's promiseto maintain the confidentiality of the fact that Flemmi was asource also constitutes an enforceable promise not to usestatements he made against him if disclosure of those statementswould, as a practical matter,reveal that Flemmi had been an informant. § III.1.D(2).

Therefore, Flemmi's statements that would identify him as aninformant could not have properly been presented to the grandjuries which indicted him. It is doubtful that any suchstatements were used in this fashion. However, further evidencewill be required to resolve this question. Id.

In addition, in the absence of a defense of public authority,or any other defense requiring introduction by Flemmi of some ofhis communications with the FBI, his statements to its agentsthat would identify Flemmi as an informant would not beadmissible at trial. However, if this case is tried and, asrepresented, Flemmi relies on some of his communications with theFBI, the court will, pursuant to Federal Rules of Evidence 106and 611, permit the government to offer other statements ofFlemmi to the Bureau in order to assure that the jury ispresented with an appropriate record on which to decide fairlythe merits of his defenses. Id.

Flemmi was expressly and implicitly promised that in return forhis contributions to the bugging of 98 Prince Street nothingintercepted there would be used to prosecute him. This promise isenforceable. § III.1.D(3).

The Attorney General has the authority to investigate crime. Aspart of that power, he has the authority to utilize informantsand to provide them promises of immunity informally, rather thanconferring it by the process established by statute. Id.

The Attorney General's power to investigate violations offederal law has been generally delegated to the FBI. Thisauthority inherently includes the power to develop and utilizeinformants. As a corollary of this, the Bureau has been delegatedthe power to promise informants both confidentiality and informalimmunity. Id.

There is no statute, regulation, order, or other legallimitation that prohibits the FBI from promising a source thatany information that he provides will not be used against him,directly or indirectly. When the Attorney General wished torestrict the power of prosecutors and investigators to promisecooperating witnesses entry into the Witness Protection Program,he issued a public order that expressly stated that they were notauthorized to do so. That restriction has been enforced by thecourts. The Guidelines developed by the Attorney General andincorporated in the FBI Manual do not constitute a comparableprohibition. The Guidelines are neither public documents norlegally enforceable. In addition, while they have at relevanttimes stated that the FBI "should not" promise its informantsimmunity, they did not provide that it could not do so. §§ II.6,III.1.D(3).

Moreover, the Attorney General has not directed that the FBIconsult a prosecutor before promising an informant immunity. Todo so would be inconsistent with the long recognized right andobligation the FBI has to maintain the secrecy of itssources.13 Id.

According to the testimony of the present and former members ofthe FBI, including its former Acting Deputy Director Potts andformer SAC Greenleaf, the supervisor of an informant's handlerwas generally the FBI's chief decisionmaker regarding informants.The SACs generallyrelied completely on the informant's handler and his supervisorfor making all decisions and recommendations regarding theinformant, including those for which the SAC was responsibleunder the Guidelines. In Potts' experience, FBI Headquartersnever reversed a recommendation from a field office that anindividual be used, or continued, as an informant. Moreover,there is no evidence that FBI Headquarters ever inquired aboutwhat promises had been made to informants generally or to Flemmiparticularly. §§ II.6, II.16, III.1.D(3).

In these circumstances, Morris and Connolly had implied, actualauthority to promise Flemmi that if he assisted the FBI's effortto bug 98 Prince Street, nothing intercepted there would be usedagainst him.14 Therefore, it was impermissible for thegovernment to present evidence intercepted at 98 Prince Street,or any information derived from that evidence, to the grandjuries that indicted Flemmi. Id.

Similarly, Flemmi had an enforceable agreement, implied in factfrom the promise concerning 98 Prince Street and the conduct ofthe government, that there would be no direct or indirect useagainst him of the intercepted evidence that he helped the FBIobtain at Vanessa's and 34 Guild Street.15 Therefore, it wasimproper for the government to present evidence intercepted at 34Guild Street to the grand juries which indicted Flemmi. It wouldalso have been improper to provide to those grand juries anyevidence derived indirectly from the interceptions at 34 GuildStreet or Vanessa's. Id.

The conclusion that Flemmi had received enforceable promises ofimmunity concerning the electronic surveillance conducted at 98Prince Street, Vanessa's, and 34 Guild Street is not qualified bythe fact that the FBI may not have been aware of all of hiscriminal activity. The Bureau did not generally ask an informantabout his own criminal activity and did not expect him to divulgethe details of it. The FBI was not misled, however, with regardto the nature of Flemmi and Bulger's crimes, including the factthat they were likely murderers. Indeed, on three occasionsMorris attempted to obtain the assistance of reluctantindividuals by sending them the message that they would be indanger of being murdered by Bulger if they did not cooperate withthe FBI.16 §§ II.4, II.16, II.33, III.1.D(3).

In addition, the fact that Morris accepted $7000 from Bulgerand Flemmi does not render the immunity promised to Flemmiconcerning the electronic surveillance conducted at 98 PrinceStreet, Vanessa's, and 34 Guild Street unenforceable as violativeof public policy. An agreement to provide immunity in exchangefor information does not inherently, or typically, involve acooperative violation of the law. No payments were made to Morrisbefore the initial promise concerning 98 Prince Street. Nor wereany later payments directly related to the promises at issue. §III.1.D(3).

The court does not by any means suggest that the payments toMorris were proper or should be condoned. However, the FBI'sbargain with Flemmi and Bulger was based on the very valuableassistance that they provided to the government. The paymentsthat Bulger and Flemmi made to Morris were only incidental to arelationship that was important to the FBI for valid,professional reasons. Moreover, they were an expression of thesense of a friendship between the FBI and its sources which theBureau deliberately created and cultivated. In the circumstances,it would be fundamentally unfair to deprive Flemmi of theimmunity that he was legitimately promised, and on which hereasonably relied, because of the payments Morris initiallysought and ultimately received. Id.

Accordingly, further hearings are necessary to determine if theindictment of Flemmi must be dismissed because it wasimpermissibly secured based upon the direct and possibly indirectuse of information Flemmi provided pursuant to promises ofimmunity. In order to avert dismissal, the government will berequired to prove that the information that it presented to thegrand juries to obtain the indictments of Flemmi was not taintedby showing that the government had an independent, legitimatesource for that evidence. If this burden is not borne, the caseagainst Flemmi will have to be dismissed unless the governmentproves that its errors were harmless beyond a reasonable doubt.If the government is able to satisfy its heavy, but notnecessarily insurmountable, burden of proving that the grand juryproceedings were not fatally infected, the court will have todecide if Due Process nevertheless requires dismissal in order toprovide Flemmi fundamental fairness concerning the express andimplied promises that he would not be prosecuted based onevidence intercepted at 98 Prince Street, Vanessa's, or 34 GuildStreet, and also decide if Flemmi is entitled to dismissal as anexercise of the court's supervisory powers. § III.1.D(4).

In connection with the further hearings, it is likely, but notcertain, that it will be necessary for the government to produceto the defendants and the court the transcripts of the grand juryproceedings that resulted in the indictments of Flemmi so thatthe effect of evidence improperly presented can be assessed. Asindicated earlier, issues to be addressed in those hearings willnot be limited to the influence of the direct use of the evidenceintercepted at 98 Prince Street and 34 Guild Street. Questions ofthe possible indirect use of that evidence, and of the evidenceintercepted at Vanessa's, will also have to be considered. Thosequestions include whether the monitored conversations producedinvestigative leads that generated evidence which was presentedto the grand juries, and whether the testimony of FBI witnesseswho read the informant files of Flemmi, and perhaps Bulger, wasshaped by information that the FBI acquired as a result of apromise of immunity. The court may also be required to decidewhether the present prosecutors, who have now been exposed totainted evidence, may participate in the preparation and conductof Flemmi's trial if the case against him is not dismissed. Id.

3. Flemmi's Motion to Suppress the 1984-85 Electronic Surveillance

Flemmi has moved to suppress the evidence resulting from the1984-85 electronic surveillance targeting him and Bulger. Thefacts relating to this motion are set forth in § II.17. Althoughthe law is not clear as to the standard that should be applied indeciding Flemmi's motion to suppress, that uncertainty is notmaterial. § III.2.B-D. Under either of the arguably applicablestandards, Flemmi's motion is meritorious. § III.2.E.

Accordingly, although evidence intercepted as a result of1984-85 electronic surveillance was not presented to the grandjuries that indicted Flemmi, furtherproceedings are necessary to determine whether the case againsthim must be dismissed, in whole or in part, because evidencederived from that electronic surveillance was utilized to securehis indictment. Those proceedings will also permit the court toidentify the evidence relating to the 1984-85 electronicsurveillance which must be excluded if the case against Flemmi istried. § III.2.F. The factual and legal basis for the resolutionof the motion to suppress the 1984-85 electronic surveillance issummarized as follows.

In 1984 and 1985, the DEA and the FBI were authorized by aseries of court orders to engage jointly in electronicsurveillance targeting Bulger and Flemmi. The investigation wasinitiated by the DEA. The agents involved preferred not tocollaborate with the FBI, primarily because they, and theAssistant United States Attorney working with them, believed thatFlemmi and Bulger were FBI informants and that the Bureau wouldcompromise the confidentiality of the investigation to protectits sources. The Bureau preferred not to participate because itviewed the endeavor as doomed to fail and expected that, as withthe Lancaster Street Garage investigation, the FBI would beblamed. The two agencies became reluctant collaborators, however,when it was recognized that the FBI's participation was essentialif judicial authorization to conduct electronic surveillance wasto be sought and received because most of the information to berelied upon in the applications to establish probable causeinvolved gambling and loansharking — crimes that the FBI ratherthan the DEA had the federal responsibility to investigate. §§II.17, III.2.E.

The applications for the court orders authorizing theelectronic surveillance of Bulger, Flemmi, Kaufman, and othersnot only relied heavily on the evidence cited to establish thatthere was probable cause to believe that they were committingoffenses within the investigatory jurisdiction of the FBI. Theyalso clearly conveyed the impression that the FBI would utilizeany evidence obtained to attempt to develop prosecutable casesconcerning matters within its jurisdiction. The Bureau, however,had no intention of doing so. The FBI was well aware, frominformation provided by Bulger, Flemmi, and others, that Bulgerand Flemmi were engaged in illegal gambling, loansharking, andextortion. The FBI considered such criminal conduct to beessential to maintaining the credibility necessary for Bulger andFlemmi to continue to obtain and provide vital information on theLCN and others. The FBI was committed to honoring its promise ofconfidentiality to Flemmi and Bulger by not disclosing that theywere sources, explicitly or implicitly. Explaining to the DEA,the prosecutors, or the court that the Bureau was not interestedin obtaining or using any intercepted evidence of their criminalconduct would have effectively confirmed they were informants.Id.

Ring, who had primary responsibility for the matter at the FBI,felt that Flemmi and Bulger had no immunity and would be "ontheir own" if the DEA could develop a prosecutable narcotics caseagainst them based on the electronic surveillance. Armed withinformation provided by colleagues, however, Connolly contributedto assuring that the DEA's efforts would not succeed by alertingBulger and Flemmi to the investigation generally and to theelectronic surveillance particularly. Id.

Blinded by its determination not to confirm for the UnitedStates Attorney's Office or the DEA the accuracy of theirunderstanding that Bulger and Flemmi were FBI informants, the FBIrecklessly disregarded the government's legal obligation ofcandor to the court when applying for authority to conductelectronic surveillance in what was represented to be a jointinvestigation. At the same time, believing that Bulger and Flemmiwere FBI informants, but accepting that the FBI would not confirmor discuss their status, the DEA and the United States Attorney'sOffice recklessly disregarded their legal obligation to seek fromthe FBI informationthat, if shared with them, would have resulted in theapplications for electronic surveillance now at issue not beingfiled, let alone approved by the court. The DEA and United StatesAttorney's Office also acted with reckless disregard for thetruth when they filed applications for warrants that in effectrepresented that electronic surveillance was necessary to obtainevidence that the FBI would use in a Title 18 investigation ofBulger, Flemmi, and others because the prosecutor who was theapplicant and the DEA agent who was the affiant did not believethat the FBI would attempt to do so. Rather, they understood thatBulger and Flemmi were FBI informants who the Bureau wished toprotect rather than prosecute. Id.

As a result, the applications for the 1984-1985 electronicsurveillance targeting Bulger and Flemmi failed to include the"full and complete statement" describing the necessity forelectronic surveillance that was required by18 U.S.C. § 2518(1)(c). More specifically, the applications should haveincluded certain material facts about the targets, including thefollowing. As informants Bulger and Flemmi had made statementsabout their illegal gambling and loansharking that the governmentnow claims can be used as evidence against them. A review oftheir files would indicate to the FBI that they were tacitlyauthorized to engage in such activities. Therefore, the conductwhich the government was seeking authority to utilize a wiretapto investigate may not have been criminal. In any event, the FBIdid not intend to use any evidence generated by the electronicsurveillance in an attempt to develop a prosecutable case againstits sources or any of the other named targets, including Kaufman.Moreover, the FBI agent who was most knowledgeable believed thatBulger and Flemmi were not involved in narcotics crimes, but mayhave mistakenly given that impression while seeking informationfor the Bureau. No reasonable judge would have granted anyrequest to target Bulger and Flemmi based on an applicationcontaining this information. Id.

In fact, if properly informed, the Assistant Attorney Generalwould not have authorized the filing of the application for awarrant at all.17 The Department of Justice would not haveallowed the submission to the court of an application that itknew was false and misleading. Nor would it have, over the FBI'sinevitable objection, permitted disclosure to the court, andpossibly to potential defendants, of the fact that Bulger andFlemmi were FBI informants. The testimony of DEA SAC RobertStutman, among other things, indicates that if the DEA had beencandidly consulted, it would have deferred to the FBI's interestin Bulger and Flemmi, and abandoned its investigation. Id.

If, however, an application had been filed seeking authority tointercept Bulger and Flemmi to obtain evidence of drug offensesonly, the request concerning Bulger would have been obviouslyunmeritorious because there was no evidence to establish probablecause to believe that he would be intercepted discussing anythingon Kaufman's telephone. In addition, the request concerningFlemmi would have been denied because there was not probablecause to believe that Flemmi would be discussing narcoticsmatters on Kaufman's telephone. Nor was there probable cause tobelieve that Kaufman would be discussing drug offenses withanyone.

In view of the foregoing, Flemmi's motion to suppress ismeritorious regardless of whether it is decided pursuant thestandard that the Supreme Court enunciated in United States v.Giordano, 416 U.S. 505, 515, 94 S.Ct. 1820, 40 L.Ed.2d 341(1974), for violations of central provisions of 18 U.S.C. § 2510et seq. ("Title III"), or pursuant to the judicially craftedexclusionary rule for violations of the Fourth Amendmentestablished in Franks v. Delaware, 438 U.S. 154, 98 S.Ct. 2674,57 L.Ed.2d 667 (1978). In Franks, the Supreme Court held thatwhen constitutionally required probable cause is in question in acase not involving Title III, a defendant must make two showingsto obtain suppression based upon possible government misconduct:first, that the information at issue was known by the governmentto be false or was presented with reckless disregard for itstruth; and second, that the information was material to thedecision to issue the warrant. 438 U.S. at 156, 98 S.Ct. 2674; §III.2.C.

The Franks standard is easier for the government to meet thanthe standard applied by the Supreme Court in deciding the motionto suppress electronic surveillance evidence in Giordano. InGiordano, the Supreme Court held that:

Congress intended to require suppression where there is failure to satisfy any of those statutory requirements [of Title III] that directly and substantially implement the congressional intention to limit the use of intercept procedures to those situations clearly calling for the employment of this extraordinary investigative device.

416 U.S. at 527, 94 S.Ct. 1820. Such provisions werecharacterized as "central" to the Title III statutory scheme.Id. at 528, 94 S.Ct. 1820. Section 2518(1)(c) concerning thenecessity of electronic surveillance is a central provision ofTitle III. §§ III.2.C and E.

If a central provision of Title III is ignored or otherwiseviolated, suppression must be ordered unless the governmentproves that the purpose which the particular procedure wasdesigned to accomplish has been satisfied in spite of the error.Id. Thus, in Giordano, the Supreme Court in effect foundlegislative intent to require suppression without regard to thereason for the violation if certain statutory provisions of TitleIII not rooted in the requirements of the Fourth Amendment arenot satisfied. In contrast, under Franks, even a material errorwould not justify suppression unless it is proven that thegovernment filed the false or misleading application for awarrant intentionally or with reckless disregard for its truth.Id.

Since Franks was decided, the Court of Appeals for the FirstCircuit has on several occasions, without analysis orexplanation, employed the Franks standard to decide motions tosuppress electronic surveillance evidence alleging failures tomeet either the probable cause or necessity requirements of TitleIII or its Massachusetts counterpart. However, at other times,the First Circuit has stated or indicated that the judiciallycrafted exclusionary rule does not apply in Title III cases.Some, but not all, other courts have utilized the Franks testto decide attacks on warrants for electronic surveillance,including the necessity requirements of § 2518(1)(c). Id.

In 1991, in United States v. Ferrara, 771 F. Supp. 1266,1298-1319 (D.Mass. 1991), this court applied the Franksstandard in denying the motion to suppress the tape-recording ofthe LCN induction ceremony that was intercepted at 34 GuildStreet. This approach was predicated on the premise that thejudicially crafted exclusionary rule is applicable to provisionsof Title III that codify requirements of the Fourth Amendment andthat § 2518(1)(c) is such a provision. § III.2.C.

This court continues to find that § 2518(1)(c) isconstitutional in origin. § III.2.D. However, the court is nowpersuaded that the statutory exclusionary rule, as interpreted inGiordano and its progeny, rather than the Franks test shouldbe applied when a central provision of Title III has beenviolated. § III.2.C. Nevertheless, the court has analyzed themotion to suppress the 1984-85 electronic surveillance under boththe Franks and Giordano standards.

Suppression of the 1984-85 electronic surveillance is requiredunder Franks because the government filed a series ofmaterially false and misleading applications with at leastreckless disregard for the truth. Suppression is also necessarypursuant to Giordano because § 2518(1)(c), a central provisionof Title III, was violated and the purpose of that provision wasnot satisfied in spite of the violation. § III.2.E.

As described earlier, further proceedings will be necessary todecide the implications of the meritorious motion to suppress the1984-85 electronic surveillance for Flemmi's motion to dismissand, if the case is not dismissed, to determine the evidence thatmust be excluded at Flemmi's trial. § III.2.F.

4. DeLuca's Motion to Suppress Concerning the LCN Induction Ceremony

Defendant Robert DeLuca was overheard and tape-recordedparticipating in the LCN induction ceremony conducted at 34 GuildStreet on October 29, 1989. Prior to the Supreme Court's December1, 1998 decision in Minnesota v. Carter, 525 U.S. 83, 119 S.Ct.469, 142 L.Ed.2d 373 (1998), the government did not contend thatDeLuca lacked standing to seek to suppress the evidence at 34Guild Street. Thus, the evidentiary hearing was conducted on thepremise that the court would have to decide the merits ofDeLuca's motion to suppress that evidence.

The facts relating to the application for the warrantauthorizing "roving" electronic surveillance which was used tobug 34 Guild Street were also relevant to the merits of Flemmi'smotion to dismiss. As indicated earlier, Flemmi was one of thefour sources relied upon in that application. In addition, themanner in which Ring and Connolly dealt with Mercurio concerning34 Guild Street was sufficiently distinctive to be probative ofFlemmi's claim that he was promised and provided protection aswell.

The facts concerning the electronic surveillance of 34 GuildStreet are summarized as follows. When Mercurio became aninformant, with his consent, the FBI and the Department ofJustice successfully sought to have his parole terminated earlyin part to permit him to be released on bail when he was indictedwith other members of Russo faction of the LCN. § II.29.

In the summer of 1989, Connolly and Ring learned from Mercurioand others that there would soon be an LCN induction ceremony.The FBI was very interested in intercepting that ceremony. Ringand Connolly expected that Mercurio would be vital to any effortto do so. §§ II.29, II.30, II.31.

At about the same time, reliable informants advised the FBIthat Mercurio had set Salemme up to be shot. Under the AttorneyGeneral's Guidelines, this information should either have beenprovided by the Boston office of the FBI to state and local lawenforcement officials, or have been submitted to officials at FBIHeadquartersand to the Assistant Attorney General. If the Guidelines had beenfollowed, the Assistant Attorney General would have had theresponsibility of deciding whether Mercurio would be continued asa Top Echelon informant or closed and subject to investigationand prosecution. The Guidelines, however, were ignored andneither disclosure nor consultation occurred. Id.

In the fall of 1989, Mercurio was providing increasinglyspecific information concerning the forthcoming LCN inductionceremony. The FBI recognized that intercepting such a ceremonyfor the first time would be of immense value in futureprosecutions and Congressional hearings. Ring very much wanted toobtain a warrant to bug that ceremony, but not at the risk ofrevealing Mercurio's status as an informant — a risk that wouldhave been created if the application for the warrant hadmentioned either the ceremony or its location because so fewmembers of the LCN would have had access to that information. §II.30.

To resolve this dilemma, Ring wished to seek a warrant toconduct roving electronic surveillance of oral communications atmultiple, unidentified locations. Title III requires that toobtain a warrant for a roving bug the government must submit tothe court "a full and complete statement as to why [it] is notpractical to specify the place to be bugged." 18 U.S.C. § 2518(11)(a)(ii). If it is shown that it is impractical to specifywhere the roving authority will be employed, the place or placesto be bugged need not be described in the application or thewarrant. Id.

Ring engaged Strike Force Chief Diane Kottmyer, who knew thatMercurio was an informant because of the Strike Force's role inhaving his parole terminated early, and agent Walter Steffens,Jr. to prepare the necessary application and supportingaffidavit. However, Ring consistently withheld from them certaininformation that he and Connolly were receiving from Mercurio.That information that would have provided Kottmyer and Steffensclear notice that it was false and misleading for the governmentto represent on the evening of October 27, 1989, that a warrantfor a roving bug was necessary because it was impractical tospecify the location to be bugged. In addition, Ring did not tellKottmyer and Steffens that, contrary to the claim in thedocuments they were drafting, the FBI did not intend to utilizethe warrant that it was seeking more than once. Id.

Because Ring and others were not candid with Kottmyer andSteffens, on October 27, 1989, a false and misleading applicationand affidavit were submitted in a successful effort to obtain awarrant for a roving bug. That warrant was used to intercept theLCN induction ceremony at 34 Guild Street on October 29, 1989.Id.

If an honest and accurate application had been filed, it wouldhave revealed the following. At all times prior to October 29,1989, the FBI, personified by Ring, knew that there would be atleast one informant, Mercurio, at the ceremony. The FBI sought awarrant for a roving bug that could be used at multiple,unidentified locations, rather than authorization to bug 34 GuildStreet alone, in order to protect the identity of its sources.The FBI had no intention of using that warrant to interceptconversations more than once. Rather, at the time the applicationwas drafted the FBI intended to arrest the participantsimmediately after the ceremony. The FBI had substantial,corroborated, "rock solid" information that the ceremony would beheld at 34 Guild Street several hours before Kottmyer andSteffens met with the judge to obtain the warrant authorizingroving surveillance based upon the representation that it wasthen "impractical" to identify the location to be bugged. Id.

The FBI made no effort to obtain the testimony of Mercurioabout the induction ceremony. Nor did the FBI ask him to recordthe ceremony, which would haveobviated the need for a court ordered bug. The FBI did not try topersuade Mercurio to cooperate in this fashion by threatening himwith possible prosecution for his role in the Salemme shooting,as well as the Sagansky-Weinstein extortion and other criminalactivity intercepted at Vanessa's. Instead, Ring and Connollyconfirmed Mercurio's understanding that the Mafia inductionceremony had been bugged. In addition, they caused him tounderstand that his indictment was imminent and permitted him toflee, as they expected he would. Id.

As a result, the FBI was relieved of the recognized risk thatthe prosecution of Russo, Ferrara, Carrozza, and theircodefendants would be jeopardized by the issues that would havebeen presented as a result of Mercurio's dual status as acodefendant and an FBI source concerning the induction ceremony,among other things. Mercurio's flight also masked for many yearsthe violation of the Attorney General's Guidelines committed byRing and his colleagues when they unilaterally decided tocontinue Mercurio as an informant despite what they believed tobe his involvement in the Salemme shooting. Id.

The foregoing facts would present serious questions for thecourt to resolve if DeLuca had standing to litigate his motion tosuppress the electronic surveillance conducted at 34 GuildStreet. Among other things, it might make a difference whetherFranks or Giordano establishes the applicable standard fordeciding that motion. However, following the December 1, 1998decision in Carter, the government argued for the first timethat DeLuca lacks the standing necessary to maintain his motionto suppress. Upon careful consideration of the parties'supplemental submissions and oral arguments on this novel issue,the court finds that the government's position is correct. §III.4.

In essence, Carter indicates that the bugging of the LCNinduction ceremony did not violate DeLuca's Fourth Amendmentrights because as a visitor to 34 Guild Street, who did not stayover night, and who engaged in only business discussions, he didnot have an expectation of privacy that society would today deemto be justified. In addition, although the matter is notperfectly clear, the court finds that when Title III was enactedit was intended that evolving, contemporary conceptions ofreasonable expectations of privacy be applied in deciding whetheran intercepted conversation constitutes an "oral communication"as defined in 18 U.S.C. § 2510(2). In view of the decision inCarter, the court is compelled to find that DeLuca did not at34 Guild Street have a justified expectation that he would not beintercepted and, therefore, did not engage in what the statutedefines as an "oral communication." Thus, DeLuca is not an"aggrieved person" as defined in § 2510(11). Accordingly, he doesnot have standing, under § 2518(10)(a), to seek suppression foran alleged violation of Title III concerning the electronicsurveillance conducted at 34 Guild Street. Therefore, his motionto suppress must be denied.

As DeLuca's motion to suppress is being denied for lack ofstanding, it is not necessary for the court to address the meritsof the issues he has sought to litigate. If this court's decisionconcerning standing is appealed and reversed, the Court ofAppeals for the First Circuit, or the Supreme Court, may in theprocess also clarify whether the standards of Franks orGiordano should be employed in deciding DeLuca's motion tosuppress. Therefore, it is most appropriate for this court todecline to analyze the merits of DeLuca's motion at this time.The court will issue the additional necessary findings of factand conclusions of law if its decision concerning DeLuca's lackof standing is reviewed and this case is remanded.

5. Conclusion of Summary

In view of the foregoing, Flemmi's motion to dismiss based on apurported promise of immunity from prosecution is being denied.DeLuca's motion to suppress theelectronic surveillance conducted at 34 Guild Street is alsobeing denied.

Flemmi's motion to suppress the 1984-85 electronic surveillanceis meritorious. He was also properly promised that if he assistedthe FBI none of the evidence intercepted at 98 Prince Street,Vanessa's, or 34 Guild Street would be used against him, directlyor indirectly. At least with regard to 98 Prince Street and 34Guild Street, that agreement was violated.

Further proceedings are required to determine the remedies towhich Flemmi is entitled as a result of his meritorious motions,including whether dismissal of the case against him is required.These proceedings will be conducted before the court enters anyOrder that may be appealable by the United States pursuant to18 U.S.C. § 2510(10)(b) or 3731.

This case has been pending for almost five years. Thedefendants' motions to dismiss and to suppress have been thesubject of intensive litigation for more than two years.Nevertheless, the merits of Flemmi's motion to dismiss cannot yetbe decided. Thus, the present posture of this case may bedisappointing to the parties and to the public, as it is,frankly, to the court. However, it should be recognized how thiscase has come to this point and the spirit in which it willproceed if it must be litigated to a conclusion.

Often the investigation of crime must be secret in order to beeffective. This is particularly true when that investigationtargets a dangerous and highly secretive organization like theLCN.

Informants are valuable, if not vital, assets in combattingserious crime. The government's ability to promise an informantconfidentiality is often important to securing his cooperationand protecting his safety. In recognition of this, the FBI hashistorically been permitted to operate its sources in secret,even from officials of the Department of Justice.

However, as Attorney General Harlan Fiske Stone, who laterbecame the Chief Justice of the United States, warned in 1924,when he established the FBI:

There is always the possibility that a secret police may become a menace to free government and free institutions because it carries with it the possibility of abuses of power which are not always quickly apprehended or understood.18

In the mid-1970's, it was discovered that such abuses by the FBIhad occurred over many years. They included FBI efforts to"neutralize" Dr. Martin Luther King as an effective civil rightsleader and "`dangerous and degrading tactics'" to disrupt lawfulpolitical activity of American citizens.19

As information about these abuses began to emerge, FBI DirectorClarence Kelly realized that even he had been deceived bysubordinates seeking to cover-up misconduct. "Admitting [in 1976]that some FBI activities had been `clearly wrong and quiteindefensible,' he declared that the Bureau should never againoccupy the `unique position that permitted improper activitywithout accountability.'"20

Anticipating the wisdom of this observation, in 1975, AttorneyGeneral Edward H. Levi began the development of Guidelines forthe FBI's use of informants, among other things. As indicatedearlier, those Guidelines did not limit the FBI's authority topromise informants immunity informally and unilaterally. TheGuidelines did, however, direct that the FBI not take any actionto conceal a crime by one of its informants. If the FBI learnedthat one of its informants had committed a seriouscrime and did not wish to disclose that information to theappropriate law enforcement officials, the Bureau was directed toinform the Department of Justice. It was intended that theDepartment would then decide whether exceptional circumstancesjustified continuing the informant as a source or whether heshould instead be closed and subject to investigation andprosecution. § II.6.

The evidence in this case indicates that the Attorney General'sGuidelines were routinely ignored with regard to Top Echeloninformants generally. As the government acknowledges, it is clearthat they were regularly disregarded concerning Flemmi andBulger. § II.6.

While the Department of Justice has historically respected theright of the FBI to maintain the secrecy of its sources fromother agencies and federal prosecutors, courts have recognizedtheir duty to compel disclosure of an informant's identity whenit has been demonstrated that such information is relevant orhelpful to the defense of an accused or essential to the fairdetermination of a case.21 In 1997, this court found that thedefendants in the instant case had proved that they were entitledto know whether Bulger, Mercurio, and Donati wereinformants.22 The court continues to believe that thisconclusion was correct.

That decision, however, opened the proverbial "Pandora's Box."As a result, many serious issues emerged. In order to decidethem, the court has made an earnest effort to find the true factsand to apply the law to those facts without fear or favor.23

In 1940, Attorney General, and future Supreme Court Justice,Robert Jackson urged federal prosecutors, and by implicationfederal investigators, to "seek[] truth and not victims."24This, however, is a challenging task for those charged withinvestigating and prosecuting dangerous criminals who, bydefinition, do not themselves "play fair." Thus, in ourdemocracy, we do not rely solely on the self-restraint of federalprosecutors and investigators to assure that crime isinvestigated lawfully.

Instead, we ultimately rely on judges, who take an oath to beimpartial, to decide whether the government has violated the lawand, if so, to determine whether a defendant's rights have beenso irreparably injured that he is entitled to a remedy that maybe as drastic as the dismissal of the case against him. Courtsare not investedwith this power and responsibility because we are a nation thatis solicitous of criminals. Rather, this duty has been delegatedby the people to the courts because we recognize that, as JusticeFelix Frankfurter wrote, "[i]t is a fair summary of history tosay that the safeguards of liberty have frequently been forged incontroversies involving not very nice people."25

We live in a nation which, above all, seeks justice. Asreflected in the words of Louis D. Brandeis that are engraved inthe entrance of the United States Courthouse in Boston, webelieve that, "Justice is but Truth in Action."26 This courtwill continue to strive to assure that this case is conductedwith fidelity to this principle.

II. FINDINGS OF FACT

1. The Standards Applied

Forty-six witnesses testified over eighty days in the hearingson the motions to suppress and dismiss now being addressed. Thecourt also received 276 exhibits and several stipulations. Theevidence presented placed certain facts in question. Thetestimony of different witnesses conflicted on various points. Inaddition, the import of many documents, and the implications ofthe absence of records, was also often disputed. Thus, the courthas been required to determine the credibility of many witnessesand much other evidence.

In doing so, the court has performed as juries are generallyinstructed with regard to determining credibility and finding thefacts. See, e.g., First Circuit Pattern Jury Instructions —Criminal §§ 1.05, 1.06 (West 1998). The court has consideredboth the direct and circumstantial evidence. Id. § 1.05. Inview of the substantial evidence that members of the FBI engagedin improper, if not illegal, conduct and thus had a motive totailor, by omission or distortion, the written records that theyreasonably expected would never be seen by others with theknowledge necessary to dispute their accuracy or completeness, attimes circumstantial evidence has been particularly important inresolving issues of credibility and in finding the facts.

In judging the believability of witnesses, the court hasapplied the conventional criteria. Id. § 1.06. These include,importantly, the manner of the witness while testifying; whetherthe witness had a bias, prejudice, or other motive to lie; theconsistency of the witness's testimony with his or her priorstatements and other evidence; and the reasonableness of thewitness's testimony when considered in the light of the credibleother evidence. Id.

The court has also recognized that witnesses at times testifyhonestly and accurately about some matters, but not all matters.Id. Thus, in certain instances, the court has credited some butnot all of a witness's testimony. For example, the court ispersuaded that Flemmi testified truthfully in claiming that hewas regularly tipped-off by the FBI regarding investigations andimpending indictments. He was not, however, always candid inidentifying the source of the information he received. Rather, heat times attributed information received from Connolly to otheragents of the FBI in an evident effort to protect Connolly and tostrengthen his own claim to an enforceable promise of immunityfrom prosecution.

Applying the foregoing principles, the court finds thefollowing facts have been proven by a preponderance of thecredible evidence.27

2. Rico and Flemmi

In the early 1960's, Flemmi began exchanging information withthe FBI. Ex. 31, ¶ 3. In November 1965, FBI Special Agent H. PaulRico targeted Flemmi for development as a Top Echelon informant —the highest status a source can achieve in the FBI. Ex. 20. Atthat time, a Top Echelon informant was defined as an individualwho "could provide a continuous flow of quality criminalintelligence information regarding the leaders of organizedcrime." Jan. 9, 1998 Tr. at 39 (Under Seal).

In 1965, Flemmi was involved in a major gang war among severalcriminal groups in Boston. Various of the warring factions wereled by Flemmi, Howard Winter, Thomas Callahan, and JosephBarboza. Ex. 20. The gang war had already resulted in severalmurders. Ex. 20; Flemmi Aug. 25, 1998 Tr. at 26. Flemmiunderstood that he was in danger of being killed. Id.; FlemmiAug. 25, 1998 Tr. at 26-28.

Flemmi is Italian-American. In the 1960's he had an ambivalentrelationship with the LCN, at different times viewing its membersas enemies and allies. Ex. 21. Flemmi's association with the LCNwas initially linked to his long partnership with FrancisSalemme, who was, evidently, unequivocal in his enthusiasm forthe LCN. Flemmi and Salemme were particularly close to IlarioZaninno, also known as Larry Baione, a Boston member of thePatriarca Family of the LCN. Id.

In November 1965, Flemmi provided Rico with valuableinformation about the possibility that Baione would becomeactively involved in the ongoing gang war, as well asintelligence about past and potential murders. Ex. 20. In Rico'sview, if Flemmi survived the gang war, he would become "a veryinfluential individual in the Boston criminal element" and "be ina position to furnish information on LCN members in [the Boston]area." Ex. 20. For the next twenty-five years, the FBI providedconsiderable assistance to Flemmi which helped make both of thesepredictions prophetic.

Since the mid-1960's, the development of Top Echelon informantshas been a very high priority for the FBI. The successfuldevelopment of informants generally, and therefore Top EchelonInformants particularly, has also been regarded as an importantachievement for an FBI agent, with the potential to affectsignificantly the progress of that agent's career. Morris Apr.29, 1998 Tr. at 44-45 See also Ex. 274 (Under Seal), FBI Manualof Instructions (hereinafter "Manual") § 137-2(3) (4-2-79). Thus,agents have been ambitious to develop Top Echelon informants.

The urgency and importance of developing Top Echelon informantsin the mid-1960's was particularly pronounced because of the thenrecent metamorphosis of the FBI's attitude toward Organized Crimeduring Robert Kennedy's tenure as Attorney General, from 1961 to1964. More specifically:

When Kennedy arrived, [FBI Director J. Edgar] Hoover did not believe there was such a thing as a national crime syndicate. In 1962 he stated that "no single individual or coalition of racketeers dominates organized crime across the nation." When Kennedy left, Hoover was taking credit for the discovery of La Cosa Nostra. In September of 1963, he wrote in the FBI's Law Enforcement Bulletin that the sensational [Joseph] Valachi disclosures [concerning the LCN] merely "corroborated and embellished the facts developed by the FBI as early as 1961 which disclosed the makeup of the gangland hordes." "At first it was like pulling teeth to get the Bureau to enter these areas," recall[ed] a Kennedy assistant, "but by 1963 all that had changed." Victor S. Navasky, Kennedy Justice 8-9 (1968).

Rico was an agent who enthusiastically embraced the FBI's newcrusade against the LCN. As part of his effort to make Flemmi anasset in that campaign, Rico made Flemmi a clear and customarypromise. Rico promised that he would not tell anyone outside theFBI that Flemmi was an informant, and would only disclose thatfact to those within the FBI who Rico felt had a need to know it.Rico Jan. 14, 1998 Tr. at 155-59. Rico made this promise to allof his informants. Id. at 158-59. To Rico, this promise was"sacred." Id. at 156. The promise was to him the "heart" of theagreement between the FBI and its informants. Id. at 63-64.Rico's view that an individual's status as an informant shouldvirtually never be disclosed to anyone outside the FBI was, andremains, a sacred article of faith within the FBI. See, e.g.,Morris Apr. 24, 1998 Tr. at 130; Gianturco Jan. 20, 1998 Tr. at131; Darcy Sept. 28, 1998 Tr. at 24.

To Rico, the promise of confidentiality meant, among otherthings, that information provided by an informant would not beused against him, at least directly, because to do so wouldnecessarily disclose that the individual had been cooperatingwith the FBI. Rico Jan. 14, 1998 Tr. at 157-58. In fact, Ricounderstood that, as a matter of law, such statements could not beused against Flemmi or any other informant because no Mirandawarnings had preceded them. Rico Jan. 13, 1998 Tr. at 126.

Rico consistently honored his promise of confidentiality toFlemmi, among others. Information from informants is recorded onan FBI Form 209 (a "209"). Ex. 274 (Under Seal), Manual §108(F)(5) (2-15-65); Ring June 15, 1998 Tr. at 59-60. Rico neverdisclosed information provided by an informant, or any of asource's 209s, to a prosecutor, either to prompt an investigationof the informant or to strengthen a prosecution of him. Rico Jan.14, 1998 Tr. at 158. For example, when Flemmi told him that hehad badly beaten Peter Fiumara in connection with an illegaldebt, Rico did not share this information with any prosecutor,agent, or agency that might have investigated Flemmi. Rico Jan.13, 1998 Tr. at 21-22. As a result of this practice, even afterFlemmi was charged with the attempted murder of John Fitzgerald,Rico did not give the prosecutor, his good friend DistrictAttorney John Droney, the statements Flemmi had made to Ricorelating to that matter. As far as Rico was concerned, thepromise of confidentiality made to Flemmi or any other informantwould endure even if Rico learned that the informant had brokenthe law. Rico Jan. 14, 1998 Tr. at 159.

While FBI agents have long routinely promised sourcesconfidentiality, Rico did not rely on this assurance alone tocultivate informants. Rico characterized his approach todeveloping informants as "unique." Rico Jan. 13, 1998 Tr. at119-20. This case demonstrates that while his methods wereunorthodox, they were not singular. In any event, as Ricotestified, he "did not always conform 100%" to what the FBIpolicies and procedures required. Rico Jan. 14, 1998 Tr. at 143.

Using his personal style, Rico sought to realize Flemmi'spotential as a source by not treating him like a criminal whoshould be used with caution to obtain valuable information.Rather, Rico created a sense that he and Flemmi were allies in acommon cause, primarily a war against the LCN. This is a sensethat Rico's successors as Flemmi's "handlers" successfully soughtto perpetuate and strengthen. Morris Apr. 22, 1998 Tr. at 15.Significantly, by word and deed, and with increasing clarity overtime, Rico promised Flemmi more than confidentiality. Flemmi Aug.20, 1998 Tr. at 22-26, Aug. 25, 1998 Tr. at 22-23, Aug. 24, 1998Tr. at 88-89, 140-43. Rico promised Flemmi "protection," id.,and he honored that promise. Flemmi was receptive to the alliancewith the FBI that Rico proposed. The arrangement offered him anopportunity touse the FBI to disable his enemies, enhance his safety, and, withthe competition diminished and the protection of the FBI, makehis own criminal activities more profitable. Flemmi Aug. 25, 1998Tr. at 25-34.

From 1965 to 1967, Rico found his relationship with Flemmi tobe productive. In that period Flemmi provided information whichRico regarded as reliable and valuable. Rico Jan. 13, 1998 Tr. at58; Exs. 214, 215, 222, 245. For example, Flemmi reported thatStevie Hughes "had been marked for a hit." Exs. 26, 218, 222.Soon after, Hughes was murdered. Ex. 26.

More importantly, Flemmi proved to be able to give Rico what hemost wanted — reliable information concerning the leaders of theLCN in New England. Flemmi regularly gave Rico informationregarding Raymond L.S. Patriarca, the Boss of the New EnglandFamily of the LCN, and Baione. See, e.g., Exs. 245, 214. Flemmireported, among other things, that Edward "Wimpy" Bennett hadtold Patriarca that he would remain neutral in a violent feudbetween the Patriarca Family and Barboza's crew. Ex. 245. Asreflected in a 209 rated "Excellent" by Rico, on February 2,1967, Flemmi reported on a meeting that he had with Baione atwhich they agreed to settle any disagreements they might havepeacefully, and at which Baione made statements indicating thatBaione was responsible for the recent murder of Wimpy Bennett.Ex. 214. Beginning with the Third Superceding Indictment (the"3SI") in this case, Flemmi and Salemme have been charged withmurdering Wimpy Bennett as part of their alleged pattern ofracketeering activity. See 3SI, Racketeering Act ("RA")21.28

Flemmi's report that Baione made statements indicating that hewas responsible for Wimpy Bennett's murder may be an earlyinstance of a pattern of false statements placed in Flemmi'sinformant file to divert attention from his crimes and/or FBImisconduct. For example, as discussed in § II.14, infra, in1982, Morris caused Connolly to tell Flemmi and Bulger that BrianHalloran was providing the FBI information that implicated themin the murder of Roger Wheeler. Halloran was murdered soon after.Morris believed Bulger and Flemmi were responsible. When Halloranwas murdered, Connolly prepared a 209 stating that Flemmi hadreported that "the wise guys in Charlestown" had heard thatHalloran was cooperating with the Massachusetts State Police and,therefore, had a motive to murder him. Ex. 225. Similarly,shortly before John Callahan, another associate of Bulger andFlemmi implicated in the Wheeler investigation, was murdered inMiami in 1983, Connolly prepared a 209 stating that Flemmi hadreported that Callahan was trying to avoid a "very bad" Cubangroup. Ex. 226. As explained infra, Flemmi and Bulger remainsuspects in the still open Wheeler, Halloran, and Callahan murderinvestigations.

In any event, on February 8, 1967, six days after Flemmiprovided information indicating that Baione was responsible forBennett's death, Rico designated Flemmi a Top Echelon informant.Ex. 21. In doing so, Rico vouched for Flemmi's reliability,stating that:

Informant has furnished information that has proven through investigation or through other sources to be true, and there is no information provided by the informant that has proven to be false.

Id.

With regard to Flemmi's past activities, Rico wrote:

Through informants of this office, it has been established that this individual enjoys a reputation of being a very capable individual and that he will now be the leader of the group formerly headed by Edward "Wimpy" Bennett, who according to informants, had been murdered and buried around 1/19/67.

Informant also has been engaged in bookmaking, shylocking, robberies, and is suspect of possibly being involved in gangland slayings.

Id. (emphasis added).

The record does not reflect what information Rico had fromother sources about Flemmi's possible participation in murders.Flemmi would have been circumspect about reporting on his owninvolvement in murder. Moreover, Rico had an incentive not todocument accurately or completely information about Flemmi'spossible involvement in serious crimes because he might lose theauthority to utilize Flemmi as an informant if Rico's superiorsdecided that Flemmi deserved to be targeted for possibleprosecution rather than employed as a source. However, a glimpseof Rico's reason at least to suspect that Flemmi was involved inmurder can be gleaned from the records of Flemmi's ownstatements. For example, as Rico wrote to the Director of theFBI:

[Flemmi] advised on 6/1/66 that Cornelius Hughes, who was murdered on 5/25/66 in Revere, Mass, had previously been around Dearborn Square, Roxbury, Mass, obviously in an effort to try to set him [Flemmi] up for a "hit" and that the fact that Connie is now deceased is not displeasing to him.

Informant was asked if he had any idea of who committed the murder, and he advised that "he had an excellent idea who committed the murder" but it would be better if he did not say anything about the murder.

Ex. 26 (quoting Ex. 222).

In any event, suspicions that Flemmi was a murderer did notdeter Rico and the FBI from making him a Top Echelon informantand an ally in pursuing their highest priority, the LCN.29 AsRico explained it:

Efforts have been made to develop this informant, by the writer, since 11/3/65. The informant was originally furnishing information on LCN members whom he considered as his enemies. Since the death of Edward "Wimpy" Bennett, Raymond Patriarca has indicated friendship towards this informant, and Larry Baione has met with the informant as he has now been accepted as an ally of theirs.

In view of the informant's excellent reputation and his present friendship with the hierarchy of the LCN in this area, he eventually could be brought in as a member of this organization.

Ex. 21.

Thus, viewed as a potential member of the LCN, Flemmi became aTop Echelon informant. Rico was his "handler." Rico's partner,Dennis Condon, was designated Flemmi's alternate agent — theperson Flemmi was to contact if he could not reach Rico. Ex. 220;Condon May 5, 1998 Tr. at 31. Flemmi, however, was never toldthat he was either open or closed administratively as aninformant in the files of the FBI. Flemmi Aug. 20, 1998 Tr. at32-33; Morris Apr. 28, 1998 Tr. at 23, Apr. 30, 1998 Tr. at 72;Quinn Aug. 19, 1998 Tr. at 112-13. Nor did Flemmi know that theFBI was documenting some of the information that he wasproviding. Flemmi Aug. 27, 1998 Tr. at 56; Morris Apr. 21, 1998Tr. at 34.

Flemmi quickly validated his perceived potential to providevaluable information concerning the highest levels of the LCN.Within weeks of becoming a Top Echelon informant, he reported ona recent meeting that he and Salemme had with Patriarca in whichPatriarca indicated an interest in making Flemmi a member of theLCN. Ex. 215.

For the next two years, Flemmi provided Rico with a steady flowof information concerning the hierarchy of the LCN in which Ricowas very interested. Rico Jan. 13, 1998 Tr. at 70. Flemmi'sinformation included, among other things, reports concerningPatriarca, Baione, Gennaro Angiulo, a leader of the LCN inBoston, and Salemme, which Rico regularly rated either very goodor excellent. Id. at 67-70. See also Exs. 23, 24, 217, 219,221. Flemmi also provided Rico with other valuable information,including intelligence on a threat to the life of the MiddlesexCounty District Attorney Garrett Byrne. Rico Jan. 14, 1998 Tr. at68; Ex. 27.

In addition, Flemmi was able to provide Rico with certaininformation and assistance that Rico especially prized. In 1966and 1967, Rico and Condon were actively attempting to persuadeBarboza to become a government witness in connection with aninvestigation they were conducting, with state officials, of the1965 murder of Teddy Deegan and other matters. Rico Jan. 9, 1998Tr. at 72, Jan. 13, 1998 Tr. at 80. They then properly perceivedthat Barboza had the potential to provide powerful testimonyagainst leading members of the LCN. Rico Jan. 9, 1998 Tr. at72-73. Rico and Condon were seeking information to use topersuade Barboza to become a witness. Rico Jan. 10, 1998 Tr. at80. Flemmi provided Rico with such information and through hisunwitting brother, Jimmy Flemmi, also provided a valuable meansfor Rico to communicate information to Barboza that he hopedwould cause Barboza to be receptive to Rico's effort to recruithim. Id. at 79-83. For example, Flemmi told Rico aboutPatriarca's plans to kill some of Barboza's associates and usedhis brother to convey that information to Barboza. Ex. 245. Thus,Flemmi materially assisted the FBI's successful effort to developBarboza as a witness. Id.

After Barboza agreed to become a government witness, Flemmi'slinks to the LCN became even more valuable to Rico. Flemmireported that Patriarca and his colleagues realized that Barbozahad become a "rat." Ex. 237 (209 dated 6/27/67). Flemmi reportedthat Patriarca had embarked on an aggressive effort to determinewhat Barboza was telling the government and was seeking todiminish the effectiveness of Barboza's anticipated testimony, inpart by murdering potential witnesses who might corroborateBarboza's claims and killing Barboza's lawyer, John Fitzgerald.Exs. 23, 34, 219, 221, 237 (209s dated 6/27/67, 7/19/67, 9/1/67,11/13/67, 12/8/67, 9/20/68). In 1967 and 1968, Flemmi constantlyprovided information on these efforts to Rico. Id.; Rico Jan.13, 1998 Tr. at 81-85. This information enhanced the FBI'sability to utilize Barboza effectively.

Barboza's cooperation proved to be extremely valuable to thegovernment. Rico Jan. 13, 1998 Tr. at 81. It resulted in asuccessful federal prosecution of Patriarca. Id. It alsocontributed to the conviction of several Patriarca associates forthe murder of Teddy Deegan. Id.

By 1969, Barboza was the most important witness Rico had everdeveloped. Rico Jan. 9, 1998 Tr. at 87. Indeed, Barboza becamenationally renowned as a witness against the LCN. Thus, by 1969,Flemmi had, as an informant, made a special contribution to theprogress of the FBI's highest priority — combating the LCN. Rico,however, never tried to convert Flemmi into a cooperating witnesswho would testify for the government. Rico Jan. 13, 1998 Tr. at71-72.

Rather, Rico continually encouraged Flemmi to maintain andincrease his contactswith the LCN, and report back to Rico. Rico Jan. 14, 1998 Tr. at110; Flemmi Aug. 20, 1998 Tr. at 22-24, Aug. 24, 1998 Tr. at 61,87. Having designated Flemmi as a Top Echelon informant in 1967,it was particularly important to Rico that Flemmi produce withregard to the LCN.

At the same time, Flemmi became concerned that his increasinglyvisible involvement with the LCN would enhance the risk that hewould be prosecuted as a result of investigations being conductedby the many law enforcement agencies that were beginning to focuson him as part of their pursuit of the LCN, including theMassachusetts State Police and the Organized Crime Unit of theBoston Police Department. Ex. 31, ¶¶ 3-4; Flemmi Aug. 20, 1998Tr. at 22-24, Aug. 24, 1998 Tr. at 87. Flemmi expressed hisconcern to Rico. Id.

Rico told Flemmi that he should not worry. Ex. 31, ¶ 4; FlemmiAug. 20, 1998 Tr. at 23, Aug. 24, 1998 Tr. at 61, 88. Morespecifically, Rico told Flemmi that as long as Flemmi wasfurnishing him information on the LCN, Flemmi would be"protected." Flemmi Aug. 24, 1998 Tr. at 61, 88-89, 140, Aug. 25,1998 Tr. at 8, 21, 22-23, 35, 94; Ex. 92, ¶ 2. Rico never usedthe word "immunity" in speaking to Flemmi. Flemmi Aug. 25, 1998Tr. 22-23. In addition to promising "protection," however, Ricosaid, in various ways, that Flemmi would not be prosecuted forcrimes he was committing while serving as an informant. Ex. 31, ¶3; Flemmi Aug. 20, 1998 Tr. at 23-24, Aug. 24, 1998 Tr. at 61,141.

Both Flemmi and Rico knew that Flemmi had to be engaged incriminal activity to have access to, and credibility with, theLCN. Flemmi Aug. 24, 1998 Tr. at 61. Rico told Flemmi that thiswould not be a problem for Flemmi. Flemmi Aug. 24, 1998 Tr. at162. Rico caused Flemmi to understand that the FBI would overlookFlemmi's criminal activity as long as he was providinginformation on the LCN. Flemmi Aug. 25, 1998 Tr. at 27-28.

Flemmi understood that his deal with the FBI would not preventother agencies from investigating him, but Rico assured Flemmithat he could take care of any issues that might arise. FlemmiAug. 25, 1998 Tr. at 32-33, 38. Thus, Flemmi expected, forexample, that Rico would intercede with District Attorneys JohnDroney and Garrett Byrne, who Rico characterized as good friends,to prevent any state charges from being brought against him.Flemmi Aug. 24, 1998 Tr. at 165-66, Aug. 25, 1998 Tr. at 32-33,35-36, 38, Aug. 27, 1998 Tr. at 61-62.

Although never discussed with Rico, Flemmi assumed that therewas some limit to the protection that Rico and the FBI couldprovide him and, therefore, did not think that his status as aninformant would protect him from being prosecuted if he committeda murder. Flemmi Aug. 27, 1998 Tr. at 140, Aug. 25, 1998 Tr. at11-12, 21-24, 19. Rico led Flemmi to believe, however, that aslong as Flemmi did not kill anyone, the FBI would protect himfrom prosecution for his criminal activity because of thevaluable information Flemmi was providing on the LCN. Flemmi Aug.25, 1998 Tr. 21-25.

Nevertheless, Flemmi became especially anxious in 1969, when helearned the IRS was investigating him as part of its intensifiedfocus on the LCN. Exs. 25, 31; Flemmi, Aug. 20, 1998 Tr. at 24,Aug. 24, 1998 Tr. at 156-57. Flemmi discussed this problem withRico. Id. Rico reiterated that Flemmi should not be concerned,he would not be prosecuted. Id. After that discussion, the IRSinvestigation "fizzled out." Flemmi Aug. 24, 1998 Tr. at 157.Flemmi inferred that Rico had, as promised, taken care of it.Id.; Flemmi Aug. 20, 1998 Tr. at 24.

The government now contends that from 1967 to 1969, Flemmirepeatedly engaged in murder while simultaneously serving as aTop Echelon informant for the FBI. More specifically, it isalleged that in addition to other crimes, in 1967Flemmi participated in the murders of Wimpy Bennett, his brothersWalter and William Bennett, and Richard Grasso. See FourthSuperceding Indictment ("4SI") Count One, RAs 20-24. AlthoughRico and his FBI colleagues often worked closely with stateinvestigators and prosecutors in organized crime matters, thereis no evidence that they contributed to any investigation ofFlemmi regarding the murders of the Bennetts or Grasso.

The present indictment also alleges that Flemmi and Salemmeattempted to murder Barboza's lawyer, John Fitzgerald. 4SI, CountOne, RA 20. Fitzgerald was crippled, but not killed, by a bombthat exploded as he started his car on January 30, 1968. OnJanuary 4, 1968, Flemmi had told Rico that Patriarca was incensedwith Fitzgerald, who Patriarca had thought would be helpful inhis effort to discredit Barboza. Ex. 221. The next day,Fitzgerald was warned that his life was in danger, but hedeclined the protection offered by the Suffolk County DistrictAttorney's Office. Id. On January 25, 1968, Flemmi told Ricothat Fitzgerald was still definitely going to be "whacked out."Ex. 34. Several days later, Fitzgerald's car exploded.

The Middlesex County District Attorney took primaryresponsibility for investigating the Fitzgerald bombing. Therecord does not reflect the role, if any, of Rico and the FBI inthat effort. In 1968, Flemmi learned that he and Salemme werebeing investigated as possible participants in the attemptedmurder of Fitzgerald. Flemmi Aug. 24, 1998 Tr. at 137; Exs. 237,22. Flemmi did not then flee.

In September 1969, however, Flemmi received a telephone callfrom Rico. Ex. 30, ¶ 6; Flemmi Aug. 20, 1998 Tr. at 27, Aug. 24,1998 Tr. at 136. Rico told Flemmi that "indictments were comingdown" and suggested that Flemmi and "his friend," Salemme, "leavetown" promptly. Id. Flemmi followed Rico's advice. Id. He andSalemme fled together. A few days later, on September 11, 1969,Flemmi and Salemme were indicted in Middlesex County for theFitzgerald bombing and in Suffolk County for the William Bennettmurder as well. Id. From Flemmi's perspective, Rico had honoredhis promise to protect him. Flemmi Aug. 24, 1998 Tr. at 137. Indoing so, Rico aided and abetted the unlawful flight of afugitive, in violation of 18 U.S.C. § 1073 and 2.

In view of Flemmi's motive to lie about whether Rico told himthat Flemmi was about to be indicted and encouraged him to flee,the court has considered this contention with particular care.However, in the context of all of the credible evidence directlyrelating to Rico's relationship with Flemmi, Rico's denial ofFlemmi's claim is not persuasive.30

The court notes that if Flemmi had been prosecuted in 1969 forthe Fitzgerald bombing or the William Bennett murder, his role asan FBI informant might have been disclosed, and its legalimplications might have been examined, three decades ago.Flemmi's successful flight to avoid that prosecution spared Ricoand the FBI the risk of the embarrassment and controversy thatdisclosure of Flemmi's dual status as an FBI informant and analleged murderer has recently entailed. Rico had reason to beconcerned about embarrassment to the FBI. He was not permitted toopen any informant unless he represented to FBI Headquarters thathe was "convinced that the potential informant [could] beoperated without danger of embarrassment to the Bureau." Ex. 274(Under Seal), Manual § 108 (9-13-63). By honoring his promise toprotect Flemmi, Rico also promoted the possibility that Flemmiwould in the future again become a valuable FBI informant.

The conclusion that Rico facilitated Flemmi's flight isreinforced by the fact that the instant case is not the firsttime that Rico has been found in a judicialproceeding to have engaged in criminal conduct, includingperjury, with regard to one of his LCN informants. In Lerner v.Moran, 542 A.2d 1089 (R.I. 1988), Ex. 259, the Supreme Court ofRhode Island found, among other things, that Rico had urged oneof his informants to lie under oath, in part to mask another ofRico's informant's role in a murder. Lerner, 542 A.2d at 1090.More specifically, the Rhode Island Court found that in the trialof Patriarca Family member Luigi Manocchio, Rico's informant,John Kelley:

admitted that during Lerner's trial [for murder], at the direction of Special Agent Rico, he testified falsely in certain matters relating to the factual circumstances surrounding the murders. For example, during Lerner's trial Kelley testified that he had personally "cut down" the shotgun used in the murders. However, during the Manocchio trial, Kelley stated that his armorer had actually "cut down" the shotgun. Kelley said that Special Agent Rico had directed him not to mention the armorer's role in the murders. It appears that the armorer was a valuable FBI informant that Special Agent Rico wanted to keep on the streets.

Id. (emphasis added). The Rhode Island Supreme Court creditedthis testimony by Kelley. Id. at 1090-91.

The Court found that Rico had also caused Kelley to lie aboutthe promises that Rico had made to obtain his cooperation. Id.at 1091. In addition, it stated that, "Kelley's [perjurous]testimony [at the Lerner trial] was then corroborated in allmaterial aspects by Special Agent Rico." Id. The Court alsonoted Kelley's explanation of why he had lied under oath: "AgentRico told me . . . that I should just do as he said, andeverything would come out all right." Id. Thus, althougharrived at independently, this court's conclusion concerningRico's misconduct in 1969 regarding Flemmi is consistent with themisconduct in which the Supreme Court of Rhode Island found thatRico had engaged concerning other informants in 1970.

In any event, on September 15, 1969, Flemmi was closedadministratively as an informant of the FBI and a federalfugitive warrant was issued for his arrest for his unlawfulflight to avoid prosecution. Ex. 28. Flemmi was not told,however, that he had been administratively closed as a source.Flemmi Aug. 20, 1998 Tr. at 32-33.

3. Flemmi as a Fugitive

Although the FBI was conducting an investigation to find Flemmiand Salemme, Flemmi stayed in contact with Rico. Ex. 30, ¶ 7;Flemmi Aug. 20, 1998 Tr. at 27-32. In about March 1970, Flemmicalled Rico. Id. Flemmi identified himself as "Jack from SouthBoston." Id. This was the code name that Flemmi and Rico hadpreviously devised to identify each other. Id.; Rico Jan. 13,1998 Tr. at 6-7.

Flemmi told Rico that he had relocated. Flemmi Aug. 20, 1998Tr. at 28-29. Rico did not ask him where he was and Flemmi didnot tell him. Id. Flemmi inquired about what was happening andasked how long Rico expected it would take to work out hisproblems. Id. Rico said it would take considerable time, andthat Flemmi should be patient and stay away from Boston. Id.FBI policy requires that all contacts with informants berecorded. See, e.g., Ex. 274 (Under Seal), Manual § 108(F)(5)(2-15-65); Ring June 15, 1998 Tr. at 59-60. Rico, however, madeno record of this conversation, or any other that he had withFlemmi while he was a fugitive. Nor did he tell the agentsresponsible for searching for Flemmi that he had spoken to him.

In April 1970, Rico was reassigned to the Miami, Florida officeof the FBI. Rico Jan. 14, 1998 Tr. at 94. His partner, Condon,remained in Boston and participated in the fugitive investigationof Flemmi and Salemme. Ex. 260; Condon May 5, 1998 Tr. at 165-81.Condon had been Flemmi's alternate agent and knew that Flemmi hadbeen an informant of Rico's. Condon May 5, 1998 Tr. at 168; RicoJan. 14, 1998 Tr. at 176; Ex. 94.

The files of the FBI indicate that beginning in September 1969,Condon periodically asked at least one source if he had anyinformation concerning the location of Flemmi and Salemme. Ex.260. Usually, Condon's source(s) had no such information. Id.Beginning in November 1970, however, Condon received informationthat Flemmi and Salemme were in New York City, where they hadbeen meeting with Manocchio, who was reportedly living in thevicinity of Central Park. Id. (209s of contacts on 11/23/70,12/3/70, 12/23/70, 1/5/71). In October 1971, Condon was firstadvised that Flemmi and Salemme had separated. Id. (209s of10/7/91). Eventually, these reports became more specific,indicating that Flemmi and Salemme had a falling out. Id. (209sof contacts on 2/10/72, 12/12 and 22/72). Reportedly, Flemmi "gotsick of being ordered around by Salemme." Id. (209 of contactson 10/9/73 and 10/26/73). Condon was told by one informant thatif Flemmi and Salemme had serious problems with each other,Flemmi would be the "loser" because Salemme was closer to Baione.Id. (209 of contact on 2/10/72).

Although Condon was not in charge of the fugitiveinvestigation, after receiving reports that Flemmi and Salemmehad split up, he contacted a young FBI agent from South Bostonwho was working in New York, John Connolly, in an effort to"spark [them] up." Condon May 5, 1998 Tr. at 165. Connolly andCondon had been introduced by Edward Walsh, the DeputySuperintendent of the Boston Police Department, just as Connollywas joining the FBI. Id. at 163, 177-78. Although he was notworking on the fugitive investigation, Connolly was receptive toCondon's call. Condon gave Connolly some general information andsent him several photographs. Condon May 5, 1998 Tr. at 165.

Connolly put the photographs to good use. In November 1972,Connolly arrested Salemme in New York City. Condon May 5, 1995Tr. at 153. According to Condon, Connolly claimed that he wasjust "strolling down" the street at lunch time with several otheragents, recognized Salemme, and arrested him. Id. at 171.

After Salemme's arrest, Condon continued to receive reportsregarding the serious rift between Flemmi and Salemme. Ex. 260(209 of contacts on 12/12 and 22/72, 1/18/73, 10/9 and 26/73).However, the recorded instances of Condon's efforts to getinformation about Flemmi's location diminished after Salemme'sarrest. Ex. 260; Condon May 5, 1998 Tr. at 40-42.

Both Flemmi and Condon deny that Flemmi provided the FBI withinformation that led to Salemme's arrest. Flemmi Aug. 25, 1998Tr. at 110; Condon May 5, 1998 Tr. at 172. In the context of allof the credible evidence in this case, it appears that this claimis not correct.

In any event, Salemme's arrest and subsequent prosecution forthe Fitzgerald bombing proved to be beneficial to Flemmi. In1970, Hugh Shields, a codefendant in the Bennett murder case, hadbeen tried and acquitted. Ex. 253; Condon May 5, 1998 Tr. at 47.In 1973, Salemme was tried on the Fitzgerald bombing charge.Robert Daddeico, who was being protected by the government, wasan important witness. May 1, 1998 Tr. at 67 (Stipulation).Daddeico testified that Salemme had participated in theFitzgerald bombing. Daddeico claimed, however, that he had liedpreviously when he had said that Flemmi was also involved. Ex.260. Salemme was convicted and, as a result, spent the nextfifteen years in prison.

Flemmi monitored Salemme's trial from Canada. Ex. 260; FlemmiAug. 25, 1998 Tr. at 80-81. He did not, however, return to Bostonin 1973, when Daddieco exculpated him with regard to theFitzgerald bombing.

Flemmi did stay in touch with Rico. Ex. 30, ¶ 7; Ex. 31, ¶ 7;Flemmi Aug. 20, 1998 Tr. at 29-30. In 1974, Flemmi called Ricoat the Miami office of the FBI. Flemmi Aug. 20, 1998 Tr. at29-30. Rico told Flemmi that he should return to Boston and hislegal problems would be favorably resolved. Ex. 31, ¶ 7; FlemmiAug. 20, 1998 Tr. at 31-32. Because of the seriousness of thecharges against him, and the fact that Flemmi was livingcomfortably in Canada, Flemmi had some reservations aboutfollowing Rico's advice. Id. Rico, however, assured Flemmi thatwhen he returned he would be released on bail and all of thecharges against him would be dismissed. Id. Once again, Rico'srepresentations to Flemmi proved to be reliable.

As arranged by Rico, on May 6, 1974, Flemmi returned to Bostonand met in Park Square two Boston Police Detectives, at least oneof whom had worked with Condon. Id.; Condon May 5, 1998 Tr. at145. Despite the fact that he had for five years been a fugitivefrom charges of murder and attempted murder, Flemmi was promptlyreleased on bail by the Middlesex and Suffolk Superior Courts.Id. The federal flight charges were dismissed on the same day.Ex. 96. The Fitzgerald bombing charges against Flemmi weresubsequently dismissed. Ex. 253; June 25, 1999 Government'sSubmission Pursuant to 6/21/99 Court Order. On November 13, 1974,the Bennett murder charges concerning Flemmi were dismissed, asthey had been against Salemme previously. Ex. 253. Flemmi was afree man.

4. The Development of Bulger as an Informant

As of at least 1971, the FBI was trying to develop Bulger as aninformant. Bulger had been incarcerated at Alcatraz, among otherplaces, as a result of an investigation led by Rico. In 1971, theviolent gang war was continuing. Ex. 97 (209 dated 7/21/71).Bulger was associated with Donald Kileen, a leader of a SouthBoston gang. Id. (209 dated 6/14/71). A close colleague ofBulger's, William O'Sullivan, was murdered. Id. (Memorandumdated 6/14/71). Bulger understood that he too had been targetedto be killed. Id.

Bulger later claimed that he was inclined to help the FBIbecause of the favorable treatment that his family had receivedfrom Rico when Bulger was in prison. Ex. 1. Bulger also felt thathe shared with the FBI a hatred of the LCN. Id.

As indicated earlier, by 1971, Rico had been reassigned toMiami. His former partner Condon, however, sought to developBulger as an FBI informant. Ex. 97; Condon May 1, 1998 Tr. 76-79.This effort was endorsed by FBI Headquarters. Ex. 97 (Teletypedated 9/10/71); Condon May 1, 1998 Tr. at 78. Bulger providedsome meaningful information concerning the continuing gang war,and additional information concerning Francis Salemme's brotherJack, among others. Id. After several months, however, Condondecided that Bulger was not being sufficiently productive andclosed him administratively as a potential informant. Ex. 97 (209dated 8/4/71); Condon May 1, 1998 Tr. at 77.

In 1972, John Morris was transferred to Boston and assigned tothe Organized Crime squad on which Condon also served. MorrisApr. 21, 1998 Tr. at 12. Morris and Condon became friendly and,until about 1976, usually commuted to work together. Id. at 60.In about 1974, Connolly was transferred to Boston and alsoassigned to the Organized Crime squad. Condon May 1, 1998 Tr. at47.

In 1974 and 1975, Morris and Connolly participated in aloansharking investigation in which the alleged victim was PeterPallotta. Morris Apr. 23, 1998 Tr. at 49-51, 67-72. Bulger was asubject of the investigation. Id. At least seven individualswere prosecuted as a result of that investigation, includingJames Martorano and Brian Halloran. Id. at 49. Bulger was notindicted. Id. at 50-51.

In the course of the Pallotta investigation, Connolly decidedto approach Bulger and attempt to make him an informant.Id. at 67-72. Connolly had known Bulger since they were bothchildren growing up in South Boston. Id. at 70; Ex. 1. Bulgerbecame a source for Connolly and was administratively designatedan FBI informant on September 30, 1975. Ex. 68. Bulger laterexplained to FBI SAC Lawrence Sarhatt that he became an FBIinformant in part because he had:

a close feeling towards SA John Connolly because they both grew up in the same neighborhood in Boston and had mutual childhood problems, as well as a deep hatred for La Cosa Nostra.

Ex. 1.

The written record of what the FBI knew about Bulger in 1974 issparse and neither Bulger nor Connolly have testified in thiscase. At a minimum the FBI recognized that Bulger was deeplyinvolved in a violent gang war. Ex. 97. The FBI had also beenadvised that Bulger was involved in extorting money from shylocksand bookmakers. Ex. 100. Morris' actions, however, make itvividly clear that the FBI was well-aware that Bulger was widelyregarded as brutally violent when Connolly sought hiscooperation.

More specifically, in 1974 or 1975, Morris hoped to obtain thetestimony of Eddie Miani in a pending investigation. Morris Apr.21, 1998 Tr. at 89, Apr. 27, 1998 Tr. at 52-53. In an effort todo so, Morris planted a fake bomb under Miani's car. Id. at89-92; Ex. 30, ¶ 17. Morris then anonymously called the localpolice or fire department and alerted it to the "bomb." Id.After the device was disabled, Morris met with Miani. Id. Inthe hope of scaring him into cooperating, Morris told Miani thatBulger had planted the bomb, and offered Miani the protection ofthe FBI if he would become a cooperating witness. Id. Mianiexpressed fear for his life, but declined Morris' offer. Id. at96. Morris testified that the Miani matter was one of threeinstances in which he unsuccessfully attempted to exploitBulger's reputation for violence in an effort to get informationfor the FBI. Morris Apr. 28, 1998 Tr. at 97-98, Apr. 29, 1998 Tr.at 110, Apr. 30, 1998 Tr. at 98-101, 203-10.31

On February 4, 1976, several months after being officiallydesignated an informant, Bulger was up-graded to Top Echelonstatus because of his "demonstrated ability to produceinformation regarding the highest levels of organized crime. . .." Ex. 68. As set forth below, that assessment may have beenbased on Bulger's new partnership with Flemmi, which was inmeaningful measure forged by the FBI.

5. The FBI Forges the Flemmi-Bulger Partnership

One of Bulger's earliest contributions to Connolly's effortswas to assist in reestablishing Flemmi's alliance with the FBI.When released after his return to Boston in 1974, Flemmi and twopartners, George Kaufman and James Martorano, rented a garage inSomerville, Massachusetts from Howard Winter, the head of theWinter Hill Gang. Flemmi Aug. 25, 1998 Tr. at 101. Bulger, amongother alleged criminals, frequented the garage. Id. Bulger andFlemmi had met socially once or twice in the 1960's, but did notreally know each other previously. Id., Flemmi Sept. 1, 1998Tr. at 203.

In the six months that the Bennett murder case remainedpending, Flemmi generally tried to maintain a low profile. Id.at 115, 154. When all of the charges against him were dismissedin late 1974, he began to become more actively involved incriminal activity, particularly gambling and loansharking. Id.at 189. This led to the resumption of Flemmi's contacts with theLCN. Id. at 115.

In early 1975, Bulger asked Flemmi whether he would be willingto meet with Connolly. Flemmi Aug. 20, 1998 Tr. at 33-35, Aug.25, 1998 Tr. at 95-96, 102-06. Bulger had previously told Flemmithat Connolly had approached him and wanted to talk. Flemmi Aug.25, 1998 Tr. at 106. It was clear to Flemmi that Bulger knew atleast generally of his prior relationship with the FBI. Id. Hetold Bulger that talking to the FBI "was a good idea." Id.Knowing that Bulger was aware of his prior relationship with theFBI and was talking with Connolly himself, Flemmi wassufficiently comfortable with Bulger's suggestion to agree tomeet with Connolly. Id. at 102-06, Aug. 20, 1998 Tr. at 35-36.

Soon after, Flemmi met with Connolly and Condon at a coffeeshop in Newton, Massachusetts for what Flemmi regarded as an"introductory" meeting. Flemmi Aug. 20, 1998 Tr. at 35-36. Ricowas discussed. Id. At the meeting, Connolly articulated whatFlemmi understood when he was invited — that the FBI was interestedin receiving information from him again. Flemmi, Aug. 25, 1998Tr. at 183.

Following the Newton meeting Flemmi began passing informationabout the LCN to Connolly through Bulger. Id. at 115. Later in1975, or in early 1976, Flemmi and Bulger had the first of a longseries of meetings with Connolly, this one at Bulger's home.Id. at 158.

At that meeting, Connolly made clear to Flemmi that he wantedto reestablish the relationship that Rico had with him andregularly receive information from Flemmi about the LCN. Id. at185. Having no prior experience with Connolly, Flemmi wanted toknow what he would get in return for his cooperation. Id.Connolly assured Flemmi that he and Bulger would be "protected"for the criminal activity they engaged in while furnishinginformation to the FBI. Id. at 185-86, 202, 206-09; Flemmi Aug.20, 1998 Tr. at 37-38. Connolly never used the term "immunity,"but on various occasions reiterated that the FBI would "protect"Bulger and Flemmi. Flemmi Aug. 20, 1998 Tr. at 211.

Connolly, and his FBI colleagues, understood that only seriouscriminals would be in a position to provide meaningfulinformation on the LCN. Flemmi Aug. 25, 1998 Tr. at 188-89;Morris Apr. 22, 1998 Tr. at 122-23, Apr. 27, 1998 Tr. at 18-19.Top Echelon informants were, by definition, members of anorganized crime group who could furnish information on thehighest levels of organized crime groups of nationalsignificance. Ex. 274 (Under Seal), Manual § 108.L (1964-77); §137-12 (1978-80); § 137-16 (1981-83); § 137-15 (1974-87). Seealso Potts May 22, 1998 Tr. at 30-35; Blackburn May 22, 1998 Tr.at 30-35, 75-78. Such informants are difficult to develop. Thus,agents were instructed that, "[t]he success of the Top EchelonCriminal Informant Program depends on a dynamic and imaginativeapproach in developing quality sources who can assist the Bureauin meeting its investigative responsibilities." Ex. NN (UnderSeal), Manual § 108 pt. III(B) (1-12-77); § 137-12(2) (4-12-79).

In the course of telling Connolly about the criminal activitiesof others, directly and through Bulger, Flemmi initially referredto his own illegal gambling and loansharking activities. Id. at153, 188-89. From the outset, and increasingly over time,however, Connolly was not under the illusion that gambling andloansharking were the only, or most dangerous, crimes in whichFlemmi and Bulger were likely involved. Rather, as Connollyrecently explained:

We knew what these guys were. They did not have a paper route when we first met them. All of them, Top Echelon Informants, are murderers. The government put me in business with murderers.

Oct. 23, 1998 Tr. at 43 (quoting R. Ranalli, "Agent hoped Bulgereluded feds," Boston Herald, Aug. 11, 1998, at 6.)32

By February 1976, when Bulger was elevated to Top Echeloninformant status, the FBI had been instrumental in the formationof what is now alleged to have been an enduring and formidablecriminal partnership between Bulger and Flemmi. The FBI madeBulger and Flemmi a perfect match. By 1976, in Boston, Flemmi andBulger uniquely shared an antipathy for the LCN, a desire toprofit from its destruction, and — most notably — the promisedprotection of the FBI.

6. Attorney General Levi's Memorandum on FBI Informants

Connolly was reiterating and reaffirming Rico's promise of FBIprotection to Flemmi at a time when the Attorney General of theUnited States, Edward H. Levi, was working to develop Guidelinesrelating to the FBI's handling of its informants. ThoseGuidelines were part of a larger effort by the Attorney Generaland others to establish standards and procedures aimed at endinga series of serious abuses by the FBI, which had long been maskedby the secrecy in which the FBI historically operated.

A book published by the Police Foundation in 1979 described thesituation during the Levi administration of the Department ofJustice (1975-77) as follows:

Watergate unleashed a torrent of revelations about questionable FBI intelligence activities, going far beyond abuses tied to the Nixon Administration. In his first appearance before a congressional committee after taking office in 1975, Attorney General Edward H. Levi confirmed the existence of previously undisclosed files maintained by former Director J. Edgar Hoover and containing derogatory information on public figures. Levi also presented the results of an inquiry by outgoing Deputy Attorney General Laurence Silberman and the FBI Inspection Division into misuse of the Bureau to gather political intelligence for administrations of both parties and to discredit the FBI's critics.

In reaction to these disclosures, Congress and the legal profession began looking more closely at the FBI, particularly at its internal security operations. Select Committees of the House and Senate included FBI abuses in their investigations of intelligence activities, and the House Judiciary Committee asked the General Accounting Office (GAO) to review FBI domestic intelligence policies and procedures. The American Bar Association set up a Special Committee to Study Federal Law Enforcement Agencies. Within the Justice Department, Attorney General Levi established a committee to draw up guidelines for FBI investigations.

The FBI, under Director Clarence M. Kelley, worked with the Attorney General and with congressional investigators to assess what had gone wrong in the past and what should be done in the future. The new revelations were sometimes shocking, especially the details of FBI efforts to "neutralize" Dr. Martin Luther King, Jr., as an effective civil rights leader during the 1960s. Former top officials of the FBI and CIA had acted on the assumption that they could disregard the normal legal rights of domestic groups because their work was so important to the national security that they were not governed by legal and constitutional standards applying to the rest of the law enforcement community. They made this claim in defense of opening mail, breaking into homes and offices without a warrant, and using what the Senate Select Committee to Study Governmental Operations with respect to Intelligence Activities (the Church committee) found to be "dangerous and degrading tactics" to disrupt and discredit lawful domestic political activities of Americans.

Even after the congressional committees issued their reports and Attorney General Levi adopted his first FBI guidelines in 1976, Director Kelley discovered that some of his subordinates had "deceived" him by not revealing FBI breakins that had taken place in 1972-1973. This information triggered still another inquiry — a criminal investigation by the Justice Department leading to indictments of former FBI officials in 1977-1978. Director Kelley summed up the problems in a landmark address at Westminster College in May 1976. Admitting that some FBI activities had been "clearly wrong and quite indefensible," he declared that the Bureau should never again occupy the "unique position that permitted improper activity without accountability."

John T. Elliff, The Reform of FBI Intelligence Operations 5-6(1974) (emphasis added).

As Director Kelley indicated, the ability of the FBI to act insecrecy, even from the Attorney General, and thus without anyaccountability, was a major reason that such abuses werepossible. There are, of course, often legitimate reasons forconfidentiality. Secrecy, however, also inherently entails risksthat were foreseeable, and indeed foreseen, when the FBI wasestablished.

The modern FBI was created in 1924, by Attorney General andfuture Chief Justice Harlan Fiske Stone, to succeed the corruptBureau of Investigation, which Stone characterized as "`lawless,maintaining many activities which were without any authority infederal statutes, and engaging in many practices which werebrutal and tyrannical in the extreme.'" Alpheus Thomas Mason,Harlan Fiske Stone: Pillar of the Law 153 (1956) (quoting Stoneto Jack Alexander, Sept. 21, 1937). On the day Stone appointed J.Edgar Hoover as the acting Director of the FBI, Stone warned of adanger that he anticipated. He said:

There is always the possibility that a secret police may become a menace to free government and free institutions because it carries with it the possibility of abuses of power which are not always quickly apprehended or understood; . . . it is important . . . that its agents themselves be not above the law or beyond its reach.

Id. at 153 (quoting N.Y. Times, May 10, 1924). The problemsLevi confronted, and those disclosed by this case, demonstratethe wisdom of Stone's warning.

That warning, however, long went unheeded. The FBI is part ofthe Department of Justice and formally subject to oversight anddirection by the Attorney General. See 28 U.S.C. § 503,531-33. However, as Levi testified in 1975, even recognizing that"the Bureau must have considerable autonomy," there were "times .. . when the supervision [of the FBI] by Attorneys General ha[d]been sporadic, practically non-existent, or ineffective."Statement of Attorney General Edward H.Levi to the Senate Select Committee on Intelligence Activities(Dec. 11, 1975) at 6.

In March 1976, Levi issued Guidelines regulating and limitingthe FBI's authority to conduct domestic security investigationsand dealing with civil disorders. See Elliff, supra, at203-09. The Attorney General also then published draft Guidelinesaddressing the relationship between the White House and the FBI.Id. at 210-14. On December 15, 1976, about a month beforeleaving office, the Attorney General issued a memorandum to theDirector of the FBI that described basic standards and proceduresfor the FBI's use of informants in Domestic Security, OrganizedCrime, and Other Criminal Investigations. Id. at 215-19 (the"Levi Memorandum"). The Levi Memorandum was incorporated in theFBI's Manual of Instructions on January 12, 1977. See Ex. 274(Under Seal), Manual § 108 pt. IV at 13 (1-12-77).

The Guidelines for FBI informants established by the LeviMemorandum were intended, in part, to diminish the perceived needfor legislation to regulate and restrict the FBI's use ofinformants and also to provide guidance if legislation was to beenacted. As Attorney General Levi testified in 1976:

I would like to [suggest] a few considerations that should be taken into account in deciding what statutory changes should be made to define more clearly the areas of the Bureau's jurisdiction and the means and methods which the Bureau is permitted to use in carrying out its assigned tasks.

First, there is a temptation to resort to having the courts make many difficult day-to-day decisions about investigations. When a Fourth Amendment search or seizure is involved, of course, recourse to a court for a judicial warrant is in most circumstances required. But the temptation is to extend the use of warrants into areas where warrants are not constitutionally required. For example, as you know it has been suggested that the FBI ought to obtain a warrant before using an informant. Extending the warrant requirement in this way would be a major step toward an alteration in the basic nature of the criminal justice system in America. It would be a step toward the inquisitorial system in which judges, and not members of the executive, actually control the investigation of crimes. This is the system used in some European countries and elsewhere, but our system of justice keeps the investigation and prosecution of crime separate from the adjudication of criminal charges. The separation is important to the neutrality of the judiciary, a neutrality which our system takes pains to protect.

In drafting statutory changes, it must be remembered that rigid directions governing every step in the investigative process could sacrifice the flexibility that is necessary if an investigative agency is to adapt to the diverse factual situations it must face. Rigid statutory provisions would invite litigation at every step in the investigative process. Such litigation could very well be used by clever individuals to frustrate legitimate law enforcement efforts without achieving the measure of control for which the statutes were enacted.

Testimony of the Honorable Edward H. Levi, Attorney General ofthe United States, Before the Subcommittee on Civil andConstitutional Rights, Committee on Judiciary, House ofRepresentatives (Feb. 11, 1976) at 3-5 (emphasis added).

The Guidelines concerning informants described in the LeviMemorandum, among other things, contributed to keepinglegislation from being enacted, and regulations from beingpromulgated, concerning the FBI's use of informants. In contrastto laws or regulations, those Guidelines did not impose anylegally enforceable obligations on the FBI or create any rightsthat are legally enforceable bydefendants. This fact was made explicit in a 1981 amendment tothe Guidelines in which the Attorney General stated:

N. Reservation These guidelines on the use of informants and confidential sources are set forth solely for the purpose of internal Department of Justice guidance. They are not intended to, do not, and may not be relied upon to create any rights, substantive or procedural, enforceable at law by any party in any matter, civil or criminal, nor do they place any limitations on otherwise lawful investigative and litigative prerogatives of the Department of Justice.

Ex. 274 (Under Seal), Manual § 137-17(N)(1-12-81) (emphasisadded). Thus, the Guidelines did not operate to remove from theFBI authority that it otherwise had to promise its informantsimmunity.

Prior to the issuance of the Levi Memorandum, the Department ofJustice did not have any institutionalized role in the FBI's useof informants. It appears, however, that the FBI occasionallysought legal advice from the Department of Justice on issuesrelating to them. For example, from at least 1961 until theissuance of the Levi Memorandum the FBI's Manual of Instructionsstated that:

On 7-10-52 the Department furnished an opinion regarding the question whether an informant could be prosecuted for technically violating the law while attempting to obtain evidence regarding a Federal violation. The Department stated ". . . If the intent throughout was to assist the government agents in the enforcement of the law, and not to violate or to `cover-up' for a violation of the law, it is not believed a case for prosecution could be made against such an informer. . . ."

The procedures to be followed by informers working under the supervision of your agents in the aid of enforcing the statutes coming within your jurisdiction largely rests upon your sound discretion. . . . It is not believed that an informer would be otherwise immune from prosecution for actions which would subject a Federal enforcement officer to prosecution.

Id. § 108(K) (10-13-61) (emphasis added). Prior to thepromulgation of the Levi Memorandum, the Manual of Instructionsalso included the direction that:

Care must be exercised in attempting to persuade individuals to act as informants to avoid any allegations of undue influence. An individual who is in custody and who offers to furnish information generally does so in the hope that he will receive some consideration in return. Bureau agents cannot promise any immunity or any reduction in sentence to a criminal who furnishes information and they must not put themselves in a situation where they might subsequently be accused of having done so.

Id. § 108(D)(4)(11-29-55 through 5-13-76) (emphasis added).

Read together, these provisions, among other things, indicatethat prior to the Levi Memorandum the procedures to be employedin dealing with informants were at all times in the solediscretion of the FBI. Consultation with Department of Justiceattorneys was not required. Indeed, such consultation with regardto an identified individual would have been inconsistent with thehistoric direction to FBI agents that: "Constant care must beexercised to avoid any disclosure to anyone which might permitidentification of a criminal informant or even cast suspicion ona criminal informant." Id. § 108(I)(8) (12-11-59) (emphasisadded). FBI agents were particularly advised, but not ordered,not to promise immunity or a reduction of sentence to "criminals"in custody whose cooperation was being sought. The FBI could,however, authorize informants who were not incarcerated to engagein what would otherwise be criminal activity without theinvolvement of Department of Justice attorneys. Id. § 108(K)(10-13-61).

In addition, the FBI alone could decide if an informant shouldbe targeted for investigation and possible prosecution ratherthan continued as a source. As a practical matter, if an FBIagent made and honored a promise to protect an informant, theAttorney General and Department of Justice prosecutors would,under then established standards and procedures, virtually neverknow. It was in this environment that Connolly, in late 1975 orearly 1976, repeated the promise of protection to Flemmi thatRico had made and kept.

In the December 15, 1976 Levi Memorandum, the Attorney Generaldescribed the risks — realized in this case with regard to Bulgerand Flemmi — that the operation of informants involves. Leviwrote:

Courts have recognized that the government's use of informants is lawful and may often be essential to the effectiveness of properly authorized law enforcement investigations. However, the technique of using informants to assist in the investigation of criminal activity, since it may involve an element of deception and intrusion into the privacy of individuals or may require government cooperation with persons whose reliability and motivation may be open to question, should be carefully limited. Thus, while it is proper for the FBI to use informants in appropriate investigations, it is imperative that special care be taken not only to minimize their use but also to ensure that individual rights are not infringed and that the government itself does not become a violator of the law. Informants as such are not employees of the FBI, but the relationship of an informant to the FBI imposes a special responsibility upon the FBI when the informant engages in activity where he has received, or reasonably thinks he has received, encouragement or direction for that activity from the FBI.

Id. § 108 pt. IV (1-12-77) (emphasis added). Among otherthings, this statement expresses the understanding of theAttorney General that it was the FBI alone that had the power,and therefore the responsibility, for making promises toinformants. Thus, the Attorney General encouraged the Bureau tobe careful in doing so.

The Levi Memorandum provided explicit factors to be weighed bythe FBI in deciding whether to utilize someone as an informant.Id. at 14. These included "the potential value of theinformation he may be able to furnish in relation to theconsideration he may be seeking from the government for hiscooperation." Id. § 108 pt. IV(A)(5) (1-22-77). The initialdecision whether to utilize an individual as an informant,however, was left solely to the FBI.

The Levi Memorandum resulted in the deletion from the FBIManual of the previously quoted § 108(D)(4) concerning grantingimmunity to informants. The Levi Guidelines included certainunqualified prohibitions, such as the provision stating that, "Noactive military personnel can be developed as informants."Id. § 108 pt. I(C)(5)(d) (1-12-77) (emphasis added). However,with regard to immunity, the new Guidelines stated, in languagethat endured at least until 1984, that:

Agents should not exercise undue influence in developing informants including promising immunity or reduction of sentence to criminals who furnish information.

Id. § 108(I)(C)(6) (1-12-77); § 137-3(6) (1-31-78); § 137-3(6)(4-2-79); § 137-5(4) (1-12-81); § 137-5(4) (9-20-82); § 137-5(4)(3-28-84) (emphasis added). This provision of the Guidelines didnot state that FBI agents were not authorized to promise immunityto informants. Rather it only stated that they should not doso. Thus, the FBI was discouraged, but not prohibited frompromising immunity to informants. This advice was expresslypremised on the principle that any such promise would be a formof "undue influence."

If the Attorney General intended to restrict the authority ofthe FBI to promise an informant immunity, he could and would havesaid so plainly. For example, on January 10, 1975, the AttorneyGeneral issued an Order, available to members of the public, thatexpressly stated that "Investigative Agents and Attorneys arenot Authorized to make representations to witnesses regardingfunding, protection, or relocation." Department of Justice OrderOBD 2110.2, P 7(d) (Jan. 10, 1975) (emphasis in original). TheOrder also provided that such promises could be made "byauthorized representatives of the U.S. Marshals Service only."Id. This legal limitation on the authority of prosecutors andinvestigators was recognized and respected by the courts. Doe v.Civiletti, 635 F.2d 88, 90 (2d Cir. 1980) (holding that oralrepresentations of a Strike Force attorney and DEA agent did notcommit the Marshals Service with regard to placing someone in theWitness Protection Program). Similarly, the United StatesAttorneys Manual ("USAM") clearly states that "`No U.S. Attorneyor [Assistant United States Attorney] has the authority tonegotiate regarding an extradition or deportation order inconnection with any case.'" San Pedro v. United States,79 F.3d 1065, 1070 n. 4 (11th Cir. 1996) (citing USAM § 9-16.020).

In contrast, neither the Levi Guidelines nor their successorsstated that FBI was not authorized to promise immunity. Nor wereFBI agents directed to consult a Department of Justice attorneyif a promise of immunity, or anything that might be construed asa promise of immunity, was being discussed.

Rather, as indicated earlier, from at least 1977 through 1980,agents were instructed that, "[t]he success of the Top Echeloninformant program depends on a dynamic and imaginative approachin developing quality sources who can help the Bureau in meetingits investigatory responsibilities." Ex. NN (Under Seal), Manual§ 108 pt. III(B) (1-12-77); § 137-12(2) (4-12-79). This directioncould understandably have been interpreted by agents aspermitting, if not encouraging, informal promises of immunity topotential informants.

Moreover, the Levi Guidelines indicated that the FBI could,without consulting any prosecutor, authorize what would otherwisebe criminal conduct by an informant. More specifically, thoseGuidelines provided that:

The FBI shall instruct all informants it uses in . . . organized crime and other criminal investigations that in carrying out their assignments they shall not:

. . . (4) participate in criminal activities of persons under investigation, except insofar as the FBI determines that such participation is necessary to obtain informantion needed for purposes of federal prosecution.

Ex. 274 (Under Seal), Manual § 108 pt. IV(B)(4) (emphasis added).Consistent with this the Attorney General stated that, "[t]he FBImay not use informants . . . for acts . . . which the FBI couldnot authorize for its undercover agents." Id. § 108 pt. IV at 13(emphasis added). Thus, in 1977, the Levi Memorandum expresslytreated the issue of authorization as solely within the provinceof the FBI. As the instant case reflects, immunity andauthorization are distinct, but closely related concepts.

In extending the traditional exclusion of Department of Justiceattorneys from the process of providing promises to FBIinformants in order to obtain information, the Levi Guidelineswere consistent with the unaltered provision of the Manual whichcontinued to state that:

Constant care should be exercised to avoid any disclosure to anyone which might result in the identification of an informant or cast suspicion upon an informant.

Id. § 108 pt. I(C)(7) (emphasis added). Moreover, FBI agentswere also instructed that:

At the earliest possible date all informants should be advised that the FBI will take all possible steps to maintain the full confidentiality of the informant's relationship with the FBI.

Id. § 108 pt. I(C)(9)(d).

Although the Levi Memorandum and related Guidelines did notprovide Department of Justice attorneys a role regarding thepromises that might be made to an FBI informant, they did for thefirst time establish a role for the Department of Justice when itlater appeared that an FBI informant may have committed a crime.Id. § 108 pt. IV(C). First, the Attorney General directed that,"[u]nder no circumstances shall the FBI take any action toconceal a crime by one of its informants." Id. § 108 pt.IV(C)(1). As described in this Memorandum, this direction wasregularly disregarded concerning Flemmi and Bulger.

In addition, if the FBI learned that one of its informants hadviolated the law in furtherance of his assistance to the FBI, itwas expected that "ordinarily" the FBI would promptly inform theappropriate law enforcement or prosecutive authorities, and theFBI would decide whether the continued use of the informant wasjustified. Id. § 108 pt. IV(C)(2). If there were "exceptional"circumstances that caused the FBI to believe that suchnotification was "inadvisable," the FBI was required to informthe Department of Justice. Id. The Department would then decidewhether law enforcement or prosecutive authorities should benotified and whether the FBI should continue to use theinformant. Id. The Levi Memorandum also established the sameprocedures where the FBI had "knowledge" that one of itsinformants had committed a "serious" crime "unconnected with hisFBI assignment." Id. § 108 pt. IV(C)(3). As described in thisMemorandum, these requirements too were regularly ignored withregard to Bulger and Flemmi.

The December 15, 1976 Memorandum and the related Guidelinesincorporated in the FBI Manual on January 12, 1977, were intendedto provide guidance to the FBI before Attorney General Levi leftoffice. They contemplated the development of additionalGuidelines.

The Levi Guidelines recognized that FBI informants may need toengage in criminal activity to obtain important information.See Ex. 274 (Under Seal), Manual § 108 pt. I(D)(5) (1-12-77).In 1981, the Guidelines were revised to clarify this point and toprovide more explicitly that informants may, if necessary andappropriate, be authorized to participate in a particularcriminal act or "a specified group of otherwise criminalactivities." Id. § 137-17(F)(2) (1-12-81).

In addition, for the first time, Department of Justiceofficials were given a role in certain authorization decisions.More specifically, since 1981, "ordinary criminal activity" is tobe authorized by an FBI field office supervisor or higher FBIofficial. Id. "Extraordinary criminal activity," includingconduct involving a "significant risk of violence," is to beauthorized by the SAC with the approval of the United StatesAttorney. Id. § 137-17(F)(2) & (3) (1-12-81). The SAC is not,however, permitted to disclose the informant's identity to theUnited States Attorney. Id. § 137-17(F)(3). Both FBIHeadquarters and the Assistant Attorney General in charge of theCriminal Division are to be immediately informed of anyauthorization of extraordinary criminal activity, although, onceagain, the identity of the informant is not to be disclosed tothe Assistant Attorney General. Id. All such authorizations areto be memorialized in writing. Id. § 137-17(F)(2).

In 1981, the Guideline provisions regarding the instructions tobe given to informants were also revised and implicitly indicatedthat informants should not be told that Department of Justiceattorneys might play a role concerning them. Rather, the 1981version of the Guidelines provided that each informant:

shall be advised that his relationship with the FBI will not protect him from arrest or prosecution for any violation of Federal, State, or local law, except where the FBI has determined pursuant to these guidelines that his association in specific activity, which otherwise would be criminal, is justified for law enforcement . . .

Id. § 137-17(E)(1) (1-12-81) (emphasis added).

In 1981, the instructions to be given informants were alsorevised to state that they should be told that:

Informant's relationship with the FBI will not protect him /her from arrest or prosecution for any violation of Federal, state, or local law, except insofar as a field supervisor or SAC determines pursuant to appropriate Attorney General's Guidelines that the informant's criminal activity is justified.

Id. § 137-3.4(1)(k) (1-12-81) (emphasis added). Thus, if therequired warnings were given to an informant, he would reasonablyunderstand that the FBI, without the involvement of anyprosecutor, had the authority to decide if the informant would beprotected from arrest and prosecution.

The Attorney General's Guidelines for the FBI's use ofinformants recognize that difficult decisions often must be madeto strike a balance between effective law enforcement andproviding benefits to criminals who are seeking to helpthemselves. The Guidelines in certain respects employ theprinciple that the weighing of these competing interests shouldbe done by informed, but relatively disinterested officials,rather than by agents who have developed a personal relationshipwith the informant and have a vested interest in the outcome ofthe investigations to which the informant may be able tocontribute. In this sense, although no judicial officer isinvolved, the Guidelines are similar in their approach to thewarrant requirement of the Fourth Amendment, which requires thatdecisions concerning whether to authorize invasions of privacy bemade by neutral magistrates rather than by those engaged in thecompetitive business of law enforcement, who do not havesufficient objectivity to be trusted to assess correctly therelative strength of the interests which must be weighed. See,e.g., Steagald v. United States, 451 U.S. 204, 212, 101 S.Ct.1642, 68 L.Ed.2d 38 (1981).

Attorney General Levi, however, recognized that there werelimits to what formal standards and procedures alone couldaccomplish. As he testified:

No procedures are fail-safe against abuse. The best protection remains the quality and professionalism of the members of the Bureau and of the Department.

Statement of the Honorable Edward H. Levi, Attorney General ofthe United States, Before the Senate Select Committee onIntelligence Activities (Dec. 11, 1975) at 13. This casedemonstrates that the enduring potential for abuse that Leviperceived was quickly realized.

The evidence in this case indicates that at least with regardto Organized Crime matters, the Guidelines were ignored from theoutset. There were no special seminars or major trainingconcerning the Guidelines that was received by the witnesses inthis case. Morris Apr. 22, 1998 Tr. at 28-33; Ring Sept. 22, 1998Tr. at 43-44; Darcy Sept. 28, 1998 Tr. at 66-67. Morrisapparently did not read the new informant Guidelines when theywere issued. Morris Apr. 22, 1998 Tr. at 28-33. The informantGuidelines were discussed occasionally in more general trainingsessions, but the Organized Crime squad supervisors in Boston didnot get answers to any questions that they had. Ring Sept. 22,1998 Tr. at 44.

In general, Morris and his successor as the supervisor of theOrganized Crime squad, Ring, viewed the Attorney General'sGuidelines as inconsistent with the Top Echelon informant programand utterly unrealistic. Morris Apr. 22, 1998 Tr. at 122-24, Apr.27, 1998 Tr. at 18-19; RingSept. 22, 1998 Tr. at 17. Thus, they felt the Guidelines did notapply to Organized Crime matters. Id. In their view, TopEchelon informants were, by definition, members of OrganizedCrime, who had to be involved in serious criminal activity.Morris Apr. 22, 1998 Tr. at 122-24, 128; Ring Sept. 22, 1998 Tr.at 17. Thus, Morris and Ring ignored provisions of the AttorneyGeneral's Guidelines that required authorization of criminalactivity and reporting of unauthorized crimes committed byinformants. Id.

The views of the supervisors of the Organized Crime squad wereespecially important. As described in this Memorandum, the SACsgenerally relied completely on the informant's handler and hissupervisor for making decisions and recommendations for which theSACs were responsible under the Guidelines. Greenleaf Jan. 8,1998 Tr. at 136-40. As Larry Potts, who served in many field FBIOffices and as Acting Deputy Director of the Bureau, put it, thesupervisor of the handling agent was the "chief decisionmaker"regarding whether or not an individual should be continued as aninformant. Potts May 22, 1998 Tr. at 7.

With regard to Flemmi and Bulger, at least, the requirements ofthe Guidelines were either ignored or treated as a bureaucraticnuisance. For example, Connolly filled out forms representingthat he gave the required warnings to Flemmi that hisrelationship with the FBI would not protect him from arrest orprosecution unless a supervisor or SAC authorized his conductpursuant to the Guidelines. Ex. 43; Gianturco Jan. 20, 1998 Tr.at 151-53. Those representations, however, were false. FlemmiAug. 28, 1998 Tr. at 133.

The evidence also indicates that FBI Headquarters did noteffectively supervise the implementation of the Guidelines. Pottscould recall no instance in which a field office's recommendationthat an individual be designated an informant was ever reversed.Potts May 22, 1998 Tr. at 6-8.

Moreover, while FBI Headquarters periodically audited theBoston office's informant files, no deficiencies with regard tothe handling of Bulger or Flemmi were noted, despite the factthat those files were replete with information indicating thatBulger and Flemmi were involved in serious criminal activity thathad not been authorized in writing, investigated by the FBI,reported to other law enforcement agencies, or reported to theAssistant Attorney General for the Criminal Division as requiredby the Guidelines. Indeed, when on the eve of the indictment ofthis case the FBI Principal Legal Advisor in Boston, John MichaelCallahan, reviewed the Bulger and Flemmi files, he concluded thatthe FBI in Boston knew a great deal about their criminal activityand, in his opinion, had tacitly authorized at least some of it,including participation in illegal gambling and LCN policymaking. Ex. 271. Any serious, earlier review of the filesconcerning information provided by Flemmi and Bulger in order todetermine compliance with the Guidelines would have made clearthat the requirements relating to authorization were beingignored. A proper review of the information about Bulger andFlemmi being provided by other informants, some of which isdescribed in this Memorandum, would have made this conclusioneven more clear.

Thus, at least with regard to Bulger and Flemmi, the FBI as aninstitution essentially disregarded the carefully calibratedstandards and procedures that were developed by Attorney GeneralLevi and his successors for continuing to use informants afterthe FBI had decided to employ them. The Department of Justice wasapparently ignorant of, or indifferent to, these violations.There is no evidence that the Department of Justice did anyreview of its own to determine if the Guidelines were beingfollowed. Rather, it seems to have relied solely on the goodfaith of the FBI.

As a result, it is not disputed that the Guidelines were notobeyed at least with regard to Flemmi and Bulger. As AssistantUnited States Attorney James Herbert stated:

We don't dispute . . . the Court's conclusion that the theory behind the Guidelines and the FBI's policies and procedures was to remove from the line agent the responsibility and the authority to make difficult decisions with respect to criminal informants . . . that is what they were designed to do and I don't think they were followed in connection with Mr. Bulger and Mr. Flemmi in the manner they were designed to.

Nov. 19, 1998 Tr. at 94. Herbert's remark to the court echoed anearlier public statement by United States Attorney Donald Stern,who said:

The FBI and attorney general informant guidelines, together with FBI administrative controls, are intended to provide the necessary checks and balances and to ensure that often difficult decisions are made at the appropriate level, based on complete and accurate information. While admittedly no system is foolproof, clearly those objectives were not met here, at least in certain critical respects.

Mitchell Zuckoff, "Bulger Case sparks probe in U.S. House," TheBoston Globe, July 24, 1998, at A12.

7. Bulger and Flemmi Begin to Perform as a Team

As indicated earlier, Bulger was designated a Top Echeloninformant on February 4, 1976, because of his "demonstratedability to produce information regarding the highest levels oforganized crime." Ex. 68. Flemmi was not officially reopened as asource until September 1980. Exs. 4, 82. Flemmi, however,continued to provide information to Connolly through Bulger anddirectly, often during meetings with Bulger and Connolly. In thecircumstances, it is likely that Flemmi was, directly orindirectly, the source of some of the information attributed toBulger in the FBI files for the periods that Bulger was open asan informant and Flemmi was not.

Some of the information Bulger and Flemmi provided in 1976 and1977 was very valuable to the FBI's organized crime effort. Mostnotably, Barboza was murdered in February 1976. Ex. 5. In May1976, Bulger reportedly informed Connolly that Jimmy Chalmas hadset Barboza up and that the LCN intended to kill Chalmas to keephim quiet. Id. Connolly and Condon used this information topersuade Chalmas to admit his guilt and become a cooperatingwitness. Id.; Condon May 1, 1998 Tr. at 130. Connolly predictedthat Chalmas' testimony would permit the FBI to obtain theconviction of Joseph Russo, who was regarded as "the # 3 memberof the LCN in the Boston Division." Ex. 5. Although Russo was formany years a fugitive, in 1992, after becoming the Consigliere ofthe Patriarca Family, he was sentenced by this court forparticipating in the Barboza murder, among other things. SeeUnited States v. Carrozza, 807 F. Supp. 156, 159 (D.Mass. 1992),aff'd, 4 F.3d 70 (1st Cir. 1993).

The FBI files also record Bulger as the source of other highlyvalued information. For example, FBI records indicated that in1977, Bulger warned Connolly that Special Agent Joseph Butchka,who was operating undercover, had been identified and targeted tobe killed. Ex. 5. The FBI acted to secure Butchka's safety andBulger was reportedly successful in preventing the prospectivehitmen from acting on their threat against him. Id.

Similarly, in 1978, Bulger told Connolly about the plannedimminent murder of Nick Gianturco, the FBI undercover agent in aninvestigation of truck hijacking known as "Operation Lobster."Ex. 5; Morris Apr. 21, 1998 Tr. at 81-84; Gianturco Apr. 20, 1998Tr. at 10-11. Once again, the FBI took effective steps to protectits undercover agent. Id. Bulger was later credited withhelping save Gianturco's life. Ex. 5.

Connolly reciprocated by providing Bulger and Flemmi theprotection that he had promised. For example, in 1977, Bulger wastold to alert Flemmi that a cleaning company had been "wired," inan effort to obtain evidence of Flemmi's loansharking. Ex. 30, ¶9. As a result, Flemmi avoided that location and was notintercepted. Id.

Similarly, in 1977 or 1978, several officials of NationalMelotone, a vending machine company, tried to prompt an FBIinvestigation of Flemmi, Bulger, and their associates for usingthreats of violence to have National Melotone's vending machinesreplaced with machines from Flemmi and Bulger's National VendingCompany. Flemmi Aug. 20, 1998 Tr. at 112-17; Ex. 30, ¶ 14. Ratherthan pursue this information, report it to local law enforcement,or advise anyone other than perhaps Morris, who had become theChief of the Organized Crime squad in December 1977, Connollysuccessfully sought to protect Flemmi and Bulger. Morespecifically, Connolly claimed that if an investigation of theirallegations was conducted the executives of National Melotone andtheir families would be in great danger, requiring theirparticipation in the federal Witness Protection Program andrelocation. Id. This advice exploited what Connolly knew werethe frightening reputations for violence that Flemmi and Bulgerhad acquired. It dissuaded the representatives of NationalMelotone from pursuing their charges. Id. Connolly did,however, tell Bulger and Flemmi about the problem. Id. Toalleviate the pressure for an investigation, Flemmi and Bulgergave National Melotone back the locations in dispute. Flemmi Aug.20, 1998 Tr. at 114.

Similarly, in October 1977, FBI Special Agents Thomas Daly andPeter Kennedy, who were then members of the Organized Crimesquad, interviewed Francis Green. Exs. 261 and 262. An informanthad reported that Bulger and Flemmi were threatening Green. Ex.163. Green confirmed that Bulger, Flemmi, and John Martorano hadapproached him about a debt he owed to Colony Finance. Id.Bulger told Green that the money Green had been lent belonged tohim and his colleagues, and that if it was not promptly repaid"they would positively kill him, that they would cut his ears offand stuff them in his mouth, that they would gouge his eyes out."Ex. 261. Green told the agents he was unwilling to testify,however. Id.

It is common for victims of threats to be reluctant to testifyinitially. Usually, the FBI tries to overcome this reticence.Ring Sept. 22, 1998 Tr. at 34. As Ring put it: "Nobody wants totestify in these types of cases. . . . You don't just turn aroundand walk away. If we did that we'd never make an organized crimecase." Id. Green later became an important government witnessin a public corruption case investigated by the IRS. See UnitedStates v. Tracey, 675 F.2d 433, 436 (1st Cir. 1982). The FBI,however, never sought to develop Green as a witness againstBulger and Flemmi.

8. Morris Becomes Chief of the Organized Crime Squad

As indicated earlier, in December 1977, Morris was promoted toChief of the Boston Organized Crime squad. Pursuing the LCNremained the FBI's "number 1 priority." Morris Apr. 22, 1998 Tr.at 127; Ex. 50. Morris regarded Bulger and Flemmi as vital assetsin that effort.

Morris understood that Bulger and Flemmi viewed the LCN as"mortal enemies." Id. at 18. At the same time, Flemmi,particularly, was one of the very few sources who could providethe FBI with "information at the policy making level of the LCN."Ex. 8; Morris Apr. 22, 1998 Tr. at 15.

Connolly urged Morris not to treat Flemmi and Bulger likeinformants. Morris Apr. 24, 1998 Tr. at 156. Morris agreed andwith Connolly cultivated the sense that Bulger and Flemmi wereallies of the FBI. For example, Morris initiallymet Bulger and Flemmi at a dinner held at his home, whichConnolly also attended. Morris Apr. 21, 1998 Tr. at 103-04. Thiswas the first in a series of such meetings with Bulger andFlemmi, which, as discussed infra, would come to include NickGianturco, Special Agent Michael Buckley, Supervisory SpecialAgent James Ring, Dennis Condon, Jules Bonovolenta, the ASAC inNew York, and Joe Pistone, then a former New York FBI agent whohad become famous for his undercover work as "Donnie Brasco."Gianturco Jan. 15, 1998 Tr. at 125-26, 154-55. Neither Morris norRing ever had similar, ostensibly social meetings with any othersource. Morris Apr. 21, 1998 Tr. at 107; Ring June 10, 1998 Tr.at 94-95.

It was evident to Morris that the attempt to cause Flemmi andBulger to feel that they were valued allies of the FBI ratherthan disreputable "rats" was successful. Morris correctly sensedthat Flemmi never realized that he and Bulger had been officiallyopened as informants or that some of the information that theyprovided was being documented in its files. Morris Apr. 21, 1998Tr. at 34.

In fact, all contacts with informants were required to bedocumented on FBI Forms 209. See, e.g., Ex. 274 (Under Seal),Manual § 108 (10-13-60 to 7-13-76); § 108 pt. I(E)(3) (1-12-77);§ 137-6(3) (1-31-78); § 137-8(2)(c-d) (1-12-81); Ring June 15,1998 Tr. at 59. Morris' view of such 209s and the informationthat they contained was similar to Rico's and also shared byMorris' colleagues in the FBI's Boston office.

More specifically, Morris understood and expected thatinformants would be told that their relationship with the FBI wasconfidential and would not be disclosed to anyone outside theFBI. Morris Apr. 24, 1998 Tr. at 130; Apr. 29, 1998 Tr. at 47.During Morris' tenure at the FBI it continued to be the Bureau'sroutine and practice to maintain the confidentiality of itsrelationship with an informant as "sacred." Morris Apr. 24, 1998Tr. at 130.

Morris believed that the FBI would be violating itsconfidentiality agreement with its informants if it disclosedinformation provided by an informant to anyone seeking toinvestigate or prosecute him. Morris Apr. 24, 1998 Tr. at 130.Thus, Morris never told Bulger or Flemmi that information theywere giving could be used against them. Morris Apr. 30, 1999 Tr.at 73. Morris did not believe that it could.

Morris correctly understood the FBI's position on this issue.For example, his view was shared by former Supervisory SpecialAgent James Darcy, whom the government called to testify as anexpert concerning the handling of FBI informants. Darcy Sept. 29,1998 Tr. at 81. Consistent with this, Potts, the former ActingDeputy Director of the FBI, knew of no instance in whichinformation furnished by an informant had been used to assist aninvestigation or prosecution of him. Potts May 23, 1998 Tr. at66. Nor did Morris. Morris Apr. 30, 1999 Tr. at 110.

9. The Race-Fix Case

In 1978 and 1979, Flemmi, Morris, and Connolly each understoodthat Flemmi and Bulger could properly be investigated by otheragents or agencies, and be prosecuted if sufficient evidence weredeveloped. This understanding was manifest in their conductconcerning an investigation of a race-fixing scheme beingconducted by Daly, who was then working in the Lawrence orLowell, Massachusetts office of the FBI, and Jeremiah O'Sullivan,a prosecutor in the Boston Organized Crime Strike Force. MorrisApr. 21, 1998 Tr. at 147-56.

The investigation focused on the payment of bribes to fix horseraces by Howard Winter and his associates. See United States v.Winter, 663 F.2d 1120 (1st Cir. 1981). The key witness wasAnthony Ciulla, who provided evidence that Bulger and Flemmi,among many others, participated in the race-fix scheme. MorrisApr. 21,1998 Tr. at 112-14, 152. Bulger and Flemmi were aware of theinvestigation and were concerned about being indicted.

On January 27, 1978, Bulger was closed administratively as aninformant because he was a primary subject of the race-fixinvestigation and might be indicted. Exs. 65, 68. Bulger was notinformed that he had been administratively closed as aninformant. Morris Apr. 22, 1998 Tr. at 66-67. Indeed, to havedone so would have been inconsistent with the FBI's approach oftrying to make Bulger and Flemmi feel they were colleagues ratherthan informants. In any event, Connolly continued his contactwith Bulger and Flemmi, but did not document those contacts orthe information they provided.

Among other things, Bulger and Connolly discussed the prospectthat Bulger and Flemmi would be indicted. Bulger and Flemmi didnot, of course, want to be charged. Connolly spoke to Morris.They agreed that they did not want to lose Bulger and Flemmi at atime when their services as informants were particularlyimportant. Morris Apr. 22, 1998 Tr. at 57-58. Thus, afterconsulting Bulger, who received the concurrence of Flemmi, inabout January 1979, Morris and Connolly met with O'Sullivan todiscuss the situation. Morris Apr. 21, 1998 Tr. at 145-58; FlemmiAug. 26, 1998 Tr. at 210, Aug. 28, 1998 Tr. at 59.

Morris and Connolly told O'Sullivan that Flemmi and Bulger wereFBI informants. Morris Apr. 21, 1998 Tr. at 154-55. Thisdisclosure to O'Sullivan violated FBI policy because it had notbeen authorized by FBI Headquarters. Id. at 159.

Nevertheless, Morris and Connolly told O'Sullivan that Bulgerand Flemmi had the ability to continue to provide valuableassistance regarding the highest priority that the FBI andO'Sullivan shared — combatting the LCN. Id. at 154. Theyemphasized that Bulger and Flemmi were "crucial" to the ambitiousplan they and O'Sullivan were developing to bug 98 Prince Street,the headquarters of Gennaro Angiulo, then the leader of the LCNin Boston. Morris Apr. 27, 1998 Tr. at 67, 72.

Thus, Morris and Connolly asked O'Sullivan not to includeBulger and Flemmi in the forthcoming race-fix indictment. MorrisApr. 21, 1998 Tr. at 147, 154-55. O'Sullivan consulted Daly, andsubsequently agreed not to charge Bulger and Flemmi in therace-fix case. Id. at 32.

Bulger told Flemmi that the discussions with O'Sullivan hadbeen successful and that they would not be indicted. Flemmi Aug.28, 1998 Tr. at 63, 65. Flemmi asked Bulger to have Connollythank O'Sullivan for him. Flemmi Aug. 20, 1998 Tr. at 46, 51-52.

About a month later, a RICO indictment relating to the race-fixscheme was returned against thirteen defendants, includingWinter, James Martorano, and John Martorano. Flemmi Aug. 28, 1998Tr. at 63; Winter, 663 F.2d at 1124. Bulger and Flemmi werenamed as unindicted coconspirators. Morris Apr. 22, 1998 Tr. at59. After a forty-six-day trial with Ciulla as the vital, "starwitness," all of the defendants who had not pled guilty or fledwere convicted. Winter, 663 F.2d at 1124, 1127, 1137.

Flemmi did not in 1979 claim that he had an enforceableagreement with the FBI that provided him immunity fromprosecution in the race-fix case. Rather, he recognized that hecould have been indicted. Thus, he was grateful that Connolly andMorris had persuaded O'Sullivan to exercise his discretion not toindict him in order to permit Flemmi to continue to providevaluable information concerning the LCN.

In May 1979, the FBI in Boston requested and received from theDirector of the FBI approval to reopen Bulger as an informant.Exs. 66, 67, 68. Bulger was characterized as a source who had"provided consistently excellent information," Ex. 66, with the"demonstrated ability to produceinformation regarding the highest levels of organized crime." Ex.68. The Director was reminded that Bulger had been closed becausehe had become a "principal subject" of the race-fixinvestigation. Id. The Director was told, however, that "noprosecutable case developed against [Bulger] in the opinion ofthe Strike Force Attorney handling the matter." This was nottrue. Rather, Bulger and Flemmi were not prosecuted in therace-fix case because Connolly, Morris, and O'Sullivan haddecided that their value as informants outweighed the importanceof prosecuting them. In any event, the Director was told that"Boston is of the opinion that [Bulger] has been, and will beonce again, one of the most highly placed and valuable sources ofthis Division." Id.

10. The FBI Does Not Investigate Bulger or Flemmi

At the time that the FBI officially reopened Bulger as aninformant, Connolly and Morris were well-aware that he and Flemmiremained involved in a range of criminal activity, based oninformation being provided by other informants and statementsmade by Bulger and Flemmi themselves. The FBI neitherinvestigated nor disclosed such information to any other lawenforcement agency because Connolly and Morris were "veryanxious" to continue to receive the "valuable" assistance ofBulger and Flemmi in the investigation of the Mafia to whichMorris had by then dedicated every member of his Organized Crimesquad. Morris Apr. 21, 1998 Tr. at 123-29.

For example, in July 1979, Morris received reports frominformants that Bulger and Flemmi were "shaking down" independentbookmakers. Exs. 60, 63; Morris Apr. 22, 1998 Tr. at 28. In theinstant case the alleged conspiracy to extort bookmakers, byBulger, Flemmi and others, is alleged to have begun in 1979.See 4SI, Count 3. The FBI, however, made no effort toinvestigate this matter when it received information concerningit two decades ago. Morris Apr. 22, 1998 Tr. at 22-29.

Similarly, in 1979 and early 1980, the FBI received informationfrom informants that Bulger and Flemmi were involved in othercriminal activity, including illegal gambling and trafficking incocaine. Exs. 63, 68. These allegations too were notinvestigated. Morris Apr. 21, 1998 Tr. at 123-29, Apr. 22, 1998Tr. at 22-29.

In 1979, Bulger was providing Connolly with informationconcerning his own criminal activities and that of some of hisassociates. For example, in May 1979, Bulger described himself asa person who ran "the South Boston Irish Mafia" and identifiedseveral "extremely dangerous" people who were associated withhim. Ex. 71. Bulger also related that his Winter Hill Gang andthe LCN had agreed to change the illegal sports betting line. Ex.40.

In addition, Bulger told Connolly that his associate JohnMartorano, who was a fugitive in the race-fix case, was in Miami,Florida. Ex. 41. Similarly, he reported that Joe Macdonald andJimmy Sims, two of his other associates who were fugitives, wouldbe back in Boston in a few days. Ex. 78. It was Morris' standardpractice to review the 209s generated by members of his squad.Morris Apr. 29, 1998 Tr. at 8. There is no evidence, however,that the FBI made any effort to act on the information Bulgerprovided concerning himself or his associates.

Rather, in June or July 1979, Connolly, Bulger, Flemmi, andGianturco met for the first time at Gianturco's home. GianturcoJan. 15, 1998 Tr. at 88, 94. Meeting informants in an agent'shome was highly unusual. Id. at 126-28. However, Bulger andFlemmi appeared to Gianturco to have a very friendly and trustingrelationship with Connolly. Id. at 98-99. Gianturco feltcomfortable with them because of the information they had givenConnolly to help save his life. Id. at 93-95.

It appears that at this meeting Bulger and Flemmi providedinformation on thecriminal activities of the Patriarca Family, Myles Connor, andothers. Ex. 35. This meeting occurred at about the time that therace-fix case was being tried, suggesting that it may also havebeen, in part, a celebration of Connolly's success in keepingBulger and Flemmi from being indicted.

In any event, Gianturco later became the alternate agent forFlemmi. Gianturco Jan. 15, 1998 Tr. at 102-03. There were aseries of dinner meetings at Gianturco's home. Id. at 106. Atsome of those meetings gifts were exchanged. Id. at 105-06,Apr. 20, 1998 Tr. at 18-24. Gianturco, for example, received fromBulger and Flemmi a toy truck to commemorate Operation Lobster, aglass statue, and a leather briefcase. Id. Gianturco gaveBulger an Alcatraz belt buckle. Id. at 21. The June or July1979 meeting, however, is the only one from which informationprovided by Bulger or Flemmi is reflected in the FBI's files.There is no record of the gifts.

11. The Lancaster Street Garage and 98 Prince Street

In 1980, it became necessary for the FBI to provide Bulger andFlemmi more than passive protection in the form of notinvestigating them in order to preserve their potential to assistthe FBI's plan to bug 98 Prince Street. In 1980, the FBIcontributed to frustrating a Massachusetts State Policeinvestigation of criminal activity of Bulger, Flemmi, and manyothers occurring at the Lancaster Street Garage, which was ownedby Kaufman.

The Massachusetts State Police had determined that "virtuallyevery organized crime figure in the metropolitan area of Boston,including both LCN and non-LCN (Winter Hill) organized crimefigures frequented the premises and it was apparent that aconsiderable amount of illegal business was being conducted atthe garage." Ex. 2. Flemmi and Bulger were among those targetedby the Massachusetts State Police. The Massachusetts State Policeconsulted O'Sullivan to discuss obtaining authority forelectronic surveillance of the Garage. Id.; Ex. 3. TheMassachusetts State Police insisted, however, that the FBI not betold about the plan because it believed that Flemmi and Bulgerwere informants, working with Morris, who might compromise theinvestigation if he knew about it. Ex. 2. Nevertheless, Morrisdiscerned that the Massachusetts State Police was conductingelectronic surveillance at the Lancaster Street Garage, in partbecause another FBI agent, James Knotts, had consulted him in anearnest effort to obtain information that could be used by theMassachusetts State Police to establish the probable causenecessary to obtain a warrant to bug that location. Morris Apr.22, 1998 Tr. at 135-38.

The Massachusetts State Police installed a microphone in theLancaster Street Garage on July 24, 1980. Ex. 2. It was"extremely productive" for about two weeks. Id. It then becameevident to the Massachusetts State Police that the targets hadbeen tipped off concerning the electronic surveillance. Id. TheMassachusetts State Police suspected Morris had learned about theinvestigation and compromised it. Id.; Ex. 10.

The Massachusetts State Police's perception that its targetshad been tipped off concerning the Lancaster Street Garageelectronic surveillance was correct, although Morris may not havebeen involved. Flemmi initially received information about thebug, through an associate, John Naimovitch, a Massachusetts StatePolice Trooper. Flemmi Aug. 20, 1998 Tr. at 108-09, Aug. 25, 1998Tr. at 242-45. Flemmi discussed this with Connolly. Flemmi claimsthat Connolly consulted Morris and O'Sullivan. Flemmi Aug. 20,1998 Tr. at 104-08, Aug. 25, 1998 Tr. at 240-42. The courtquestions whether this is correct, particularly with regard toO'Sullivan. In any event, Connolly was somehow able to confirmfor Flemmi and Bulger that the Lancaster Street Garage wasbugged. Flemmi Aug. 20, 1998 Tr. at 103-05, Aug. 25, 1998 Tr. at242-43.Flemmi and Bulger advised some of their associates, includingKaufman, and the discussion of criminal activity at the LancasterStreet Garage ceased. Ex. 9; Flemmi Aug. 26, 1998 Tr. at 93-94.

Realizing that the investigation of the Lancaster Street Garagehad been compromised, Colonel O'Donovan, the head of theMassachusetts State Police, complained to the FBI and made itclear that the Massachusetts State Police was convinced thatBulger and Flemmi were FBI informants. Exs. 2, 9, 10. The factthat Bulger and Flemmi's status as FBI sources had beenrecognized and discussed in the context of a promising criminalinvestigation was a matter of concern for Sarhatt, who hadrecently became the SAC in Boston. Ex. 10. The situation had thepotential to embarrass the FBI in several ways. First, a beliefin the criminal community that Bulger and Flemmi were informantscould have caused them to be killed, thus placing in doubt theFBI's ability to protect its sources. Second, Sarhatt recognizedthat Bulger and Flemmi might be prosecuted for committing seriouscrimes. Their prosecution would have raised within the FBI, andperhaps more widely, questions concerning the Bureau's decisionto work with them rather than investigate them. Thus, Sarhattwondered whether the FBI should target Bulger and Flemmi forinvestigation rather than continue them as sources. Sarhatt Jan.7, 1998 Tr. at 60, 64-66. Finally, Sarhatt was concerned that itmight be true that one of his agents had disclosed theMassachusetts State Police investigation to two of its targets.Exs. 2, 9. Sarhatt acted on each of these concerns.

Morris was questioned about whether he had contributed tocompromising the Lancaster Street Garage investigation. Inresponse, Morris gave Sarhatt false information about some of hisactivities and was cleared. Ex. 69; Morris Apr. 22, 1998 Tr. at154-55, Apr. 23, 1998 Tr. at 38.

Sarhatt also considered whether the FBI should keep Bulger andFlemmi open as informants or target them for investigation.Sarhatt Jan. 7, 1998 Tr. at 60, 64-66. Connolly and Morris urgedhim to continue them as informants. Connolly wrote memorandareviewing the history of exceptional service that Bulger andFlemmi had rendered as sources, which Morris endorsed andamplified. In addition, with regard to Flemmi, who had beenreopened as an informant in September 1980, Exs. 7, 4, Connollywrote on December 2, 1980, that:

Information from this source is currently being utilized in the preparation of an affidavit in support of a Title III application targeting [98 Prince Street], which is the highest priority organized crime investigation in Headquarters City [Washington, D.C.]. In addition to the Angiulo case, this informant is one of the two primary informants who will furnish the majority of probable cause for a Title III application targeting Illario Zannino (# 2 man in the Boston LCN).

Ex. 8. With regard to Flemmi, Morris added:

I concur with the observations and evaluations of SA Connolly, and recommend continued contacts with captioned source. This source is one of very few sources who can furnish information at the policymaking level of the LCN and has been consistently rated as very good by the reviewing Inspector. Continuing information from the informant is considered to be a critical factor in Boston's overall Organized Crime Program.

Id. (emphasis added).

Connolly described in the same terms Bulger's importance to theaffidavits being prepared to obtain electronic surveillance of 98Prince Street and of Zannino. Ex. 5. Morris again agreed withConnolly and added that:

[Bulger] is one of the most highly placed and valuable informants in the Boston Division. [He] was last rated as excellent by the reviewing Inspector in 1976. The closing of an informant of this caliber would deal a serious blow to the [Organized Crime Program] of the Boston Division.

Id. (emphasis added).

In essence, Connolly and Morris advised Sarhatt that Flemmi andBulger were of vital importance to the plan to bug 98 PrinceStreet, in which the FBI had a great investment on which it hopedto capitalize imminently, and to the Boston Office's OrganizedCrime program generally. Thus, they felt strongly that Bulger andFlemmi should not be closed as informants.

Sarhatt also consulted O'Sullivan, who had become the Chief ofthe Boston Organized Crime Strike Force, with regard to whetherBulger should be continued as an informant. Ex. 3; Sarhatt Jan.7, 1998 Tr. at 43-49. This was highly unusual because it involvedidentifying, or confirming the identity of, a confidential sourceto a prosecutor. O'Sullivan, however, was already aware thatBulger and Flemmi were informants, and also knew that theMassachusetts State Police had concluded that they were sourcesfor the FBI. Exs. 2, 3. According to Sarhatt's memorandum,O'Sullivan urged him to continue Bulger as an informant. Ex. 3;Sarhatt Jan. 7, 1998 Tr. at 53. More specifically, Sarhatt wrotethat O'Sullivan told him that:

it is crucial that the FBI continue this source [Bulger] inasmuch as the information he is currently furnishing is crucial to a Title III application of LCN members in Boston.

Mr. O'Sullivan stated that he did not feel there was any improper conduct on the part of the FBI by continuing the Informant relationship with [Bulger]. He stated that there was sufficient justification for continuing him regardless of his current activities to be able to eventually prosecute LCN members.

Ex. 3.33

On November 25, 1980, Sarhatt also took the unusual step ofmeeting with Bulger himself as part of his effort to determinewhether the FBI had compromised the Massachusetts State Police'sLancaster Street Garage investigation and whether Bulger andFlemmi should be continued as informants. Exs. 1, 87; SarhattJan. 2, 1998 Tr. at 14. It was at this meeting that Bulgerexpressed his appreciation for Rico's courtesy and explained hiswarm feelings for Connolly, based on their common roots andshared "deep hatred for La Cosa Nostra." Ex. 1. At this meeting,Bulger also falsely claimed that he had not been given anyinformation about the Lancaster Street Garage investigation bythe FBI. Id. In doing so, Bulger was protecting Connolly.

Sarhatt was also interested in confirming that Bulgerunderstood that the Massachusetts State Police was "fully awareof his Informant role with the FBI" and "his life could be indanger," and in documenting Bulger's response. Id. Sarhattrecordedthat Bulger acknowledged that his status as an FBI informant wasbeing widely discussed, but said that:

[Bulger] was not concerned with his personal safety because no one would dare believe that he is an informant. It would be too incredible. Notwithstanding this notoriety, he indicated . . . that he wants to continue the relationship with the FBI.

Ex. 1. This echoed what Bulger and Flemmi had previously toldConnolly. Ex. 10. In essence, Bulger explained to Sarhatt that hewas confident that the idea of a partnership between the FBI anda criminal of his stature was too extraordinary to be believed.

Bulger included in his interview high praise for the FBI. AsSarhatt recorded it, Bulger said:

With respect to his association with Colonel O'Donovan . . . he has met him on some occasions especially one in which he made very disparaging and derogatory statements about the professionalism of FBI personnel to which he took great umbrage, inasmuch as his association with the FBI has been nothing but the most professional in every respect.

Id.

Thus, with the encouragement of Bulger, O'Sullivan, Morris, andConnolly, Sarhatt in December 1980 decided to continue Bulger andFlemmi as informants, rather than target them for investigation,and to review their status again after March 30, 1981. Exs. 5, 8.

In November and December 1980, when Sarhatt was consideringwhether to continue Bulger and Flemmi as informants, Connolly andMorris had substantial reason to appreciate what Bulger andFlemmi had contributed to their work, and compelling cause towant to avoid any change in their status. For example, in themidst of the Lancaster Street Garage controversy, on September11, 1980, Flemmi told Connolly that the Patriarca Family had beenquietly making new members, including Salemme and VincentFerrara. Ex. 237, (209 dated 9/11/80). The next day, Flemmi wasreopened as an informant because his "past legal problems [had]been resolved" and he had been "recontacted and has providedinformation of value and continues to be in a position to do soin the future." Ex. 4; see also Ex. 82. In the next monthFlemmi gave Connolly Jack Salemme's telephone numbers, Ex. 237(209 dated 9/23/80), and information relating to the murder offederal Judge James Wood. Exs. 8, 231.

Most significantly, however, Flemmi and Bulger had by December1980 made a critical contribution to the effort to bug 98 PrinceStreet. In October 1980, Morris and Connolly gave Bulger andFlemmi an assignment. Morris Apr. 20, 1997 Tr. at 12, Apr. 27,1998 Tr. at 11-12. Bulger and Flemmi were told that the FBIwanted to bug 98 Prince Street. Flemmi Aug. 20, 1998 Tr. at125-26, Aug. 26, 1998 Tr. at 178-79; Morris Apr. 28, 1998 Tr. at104-05. Morris and Connolly asked Bulger and Flemmi to obtaininformation that was important to the feasibility of that effort.They asked them to go to 98 Prince Street, look carefully at thepremises, and provide the FBI everything possible concerning thedoors, locks, and any security devices. Morris Apr. 27, 1998 Tr.at 11-13; Flemmi Aug. 26, 1998 Tr. at 126.

Bulger and Flemmi expressed two concerns when confronted withthe request. Bulger particularly was reluctant to go to 98 PrinceStreet because he did not trust the LCN and was afraid he andFlemmi might be killed. Morris Apr. 21, 1998 Tr. at 29-30, Apr.24, 1998 Tr. at 43-45. See also Ex. 78. Morris and Connollyfelt this fear was well-founded. Flemmi Aug. 20, 1998 Tr. at 43.Indeed, in about December 1980, Morris played for Bulger andFlemmi a tape of still undetermined origin on which Zannino andanother member of the Patriarca Family, Domenic Isabella,discussed looking for the right opportunityto kill Flemmi and Bulger. Flemmi Aug. 20, 1998 Tr. at 52-55.

Flemmi expressed another concern. He recognized that if 98Prince Street were bugged, discussion of some of his and Bulger'scriminal activity was likely to be intercepted. Flemmi Aug. 26,1998 Tr. at 184-86, 189-91, Aug. 20, 1998 Tr. at 43-45. Flemmiwanted to know what would be done with any such evidence. Id.Morris and Connolly assured Bulger and Flemmi that the 98 PrinceStreet tapes would not be a problem for them. Id. They would beprotected for any thing picked up on those tapes, rather thanprosecuted. Id. Thus, Flemmi understood that nothing on thetapes would be used against him. Flemmi Aug. 26, 1998 Tr. at189-90.34 That understanding was reasonable. In addition, butfor the assurance received from Morris and Connolly, Flemmi andBulger would not have assisted the FBI in its effort to bug 98Prince Street.

With this assurance, Flemmi and Bulger went to 98 PrinceStreet. They returned with the information that the FBI hadrequested, including a diagram of the premises. Ring June 11,1998 Tr. at 135-36. The subsequent bugging of 98 Prince Street,which was generally viewed as a virtually impenetrable location,was considered a remarkable technical feat for the FBI. Bulgerand Flemmi made a unique contribution to that achievement.

On January 9, 1981, the government applied for, and received, awarrant to bug 98 Prince Street. Aff. of Paul E. Coffey, Apr. 9,1997 ("Coffey Aff., Apr. 9, 1997"), ¶ 3A. Bulger and Flemmi weretwo of the sources whose information was used to establish thelegally required probable cause. Id. Information that theyprovided was also included in some, but not all, of the periodicrequests for extensions. Id. In addition, Bulger was a sourcewhose information was used to get a warrant to bug Zannino'spremises at 51 North Margin Street. Id.

Bulger and Flemmi were told when the bug had been installed inJanuary and when it was removed in April 1981. Flemmi Aug. 20,1998 Tr. at 126-27; Morris Apr. 28, 1998 Tr. at 105-06.Accordingly, neither of them went to 98 Prince Street when it wasbugged. Thus, neither was recorded on the 98 Prince Street tapes.

It was highly irregular for sources to be told why the FBI wasrequesting certain information or that a particular location wasbeing electronically monitored. FBI agents are generallyinstructed that: "Care must be exercised in handling informantsto ensure that they are provided no information other than thatnecessary to carry out their assignments." Ex. 274 (Under Seal),Manual § 137-5(10) (3-28-84). As Ring explained, criminal sourcesmay be very helpful, but are usually regarded as not completelytrustworthy. Ring June 10, 1998 Tr. at 68-69. Thus, it isgenerally unduly risky to tell them about the FBI's intentions oractivities. Id.

Connolly and Morris, however, had full faith in Flemmi andBulger. Morris Apr. 28, 1998 Tr. at 105-06, Apr. 27, 1998 Tr. at14. They were confident that their sources would not betray them.Id. Thus, they treated Bulger and Flemmi as colleagues ratherthan informants in explaining the FBI's plan to bug 98 PrinceStreet and letting them know when the electronic surveillance wasoperating.

Indeed, in about January 1981, Flemmi, Bulger, Connolly, andMorris gathered in Morris' home in Lexington, Massachusetts forwhat Flemmi characterized as a belated Christmas celebration.Flemmi Aug. 20, 1998 Tr. at 55-56. The timing of this firstmeeting at Morris' home suggests itmay also have been a celebration of the successful bugging of 98Prince Street. In any event, Bulger and Flemmi brought wine and achampagne bucket for Morris. Id. Morris reciprocated by givingFlemmi, a Korean War veteran, a painting from Korea. Id.

12. Sarhatt Extends Bulger and Flemmi As Informants

As described earlier, in December 1980, when Sarhatt authorizedMorris and Connolly to continue Bulger and Flemmi as informants,rather than target them for investigation, he planned toreevaluate Bulger and Flemmi's status after March 30, 1981. Exs.5, 8. He subsequently had his new ASAC, Robert Fitzpatrick, whohad come to Boston in January 1981, meet with Bulger to assist inthat assessment. Fitzpatrick Apr. 17, 1998 Tr. at 47-49, 59.Fitzpatrick testified that he had misgivings about continuingBulger and Flemmi as informants. More specifically, he statedthat he was concerned that Bulger and Flemmi were not beingsufficiently productive, and were engaged in serious crime,including crimes of violence and collecting "tribute" from drugtraffickers. Fitzpatrick Apr. 17, 1998 Tr. at 53-59. There is nowritten record indicating that Fitzpatrick ever expressed suchconcerns to Sarhatt, however.

In any event, in memoranda dated April 1, 1981, Connolly andMorris strongly urged that Bulger and Flemmi be continued asinformants based on their invaluable contributions to the buggingof 98 Prince Street and 51 North Margin Street, and theirpotential to assist in the development of cases those tapes mightgenerate and other organized crime matters. Exs. 50, 51. Morespecifically, with regard to Flemmi, Morris wrote that:

information provided by this informant has been utilized in six successful affidavits in support of six applications for court authorized electronic surveillance pursuant to the provisions of Title III. These affidavits are in connection with two of the highest priority organized crime matters under investigation in the Boston Division. One of these two cases, [98 Prince Street] is one of the highest priority organized crime cases in the FBI today and involves what has been characterized by [FBI Headquarters] officials as one of the most important and successful Title IIIs to have been conducted by the FBI in the past ten years.

Ex. 50 (emphasis added). Morris reiterated these remarks inendorsing Bulger's continuation as an informant.

In addition, Morris wrote that Bulger and Flemmi were each:

a highly placed and valuable informant. Informants such as [Bulger and Flemmi] take years to develop and form the nucleus of any viable long range Organized Crime Program. [Each] informant should not only continue to be contacted but in fact targeted for ever increasing productivity.

Exs. 50, 51.

Fitzpatrick reviewed and initialed each memorandum withoutdissent. Sarhatt agreed to continue Bulger and Flemmi asinformants. Exs. 50, 51.

Bulger and Flemmi quickly validated Morris and Connolly'sassessment of their potential to continue to contribute to theFBI's organized crime efforts. For example, in April or May 1981,Morris arranged to meet Bulger and Flemmi at the Hotel Colonnade.Flemmi Aug. 20, 1998 Tr. at 60-63. Morris played for them a tapeof a conversation intercepted at 98 Prince Street on whichAngiulo and Zannino discussed killing their associate Nick Gizo'sgirlfriend, Liz McDonough. Id.; Ex. 210; Morris Apr. 27, 1998Tr. at 104-05. Morris asked for Bulger and Flemmi's assessment ofthe threat. Flemmi Aug. 20, 1998 Tr. at 63. Flemmi said that hefelt the threat was real. Id.

In the course of this meeting, the three drank wine. Id.Morris had so much that Bulger decided to drive him home. Id.Flemmi kept the tape. Id.; Ex. 210.Subsequently, Bulger and Flemmi began referring to Morris as"Vino." Flemmi Aug. 20, 1998 Tr. at 63.

In addition to assisting with interpreting the tapes, Flemmipromptly provided the FBI valuable assistance in its ongoingeffort to develop a strong case against Angiulo and hisassociates. Among other things, Flemmi told the FBI that the LCNbelieved Angiulo's office had been bugged. Ex. 237 (209 dated5/14/81). He also identified an individual Flemmi felt wouldtestify against Angiulo if targeted by the FBI. Id. (209 dated5/14/81). In addition, Flemmi reported on meetings he had withAngiulo at 98 Prince Street and elsewhere. Id. (209 dated9/18/81); Ex. 79.

Flemmi also advised the FBI that: the LCN planned to murderseveral suspected informants, Ex. 237 (209 dated 12/15/81); JoeRusso, who was "on the lam," had returned to visit Zannino, id.(209 dated 7/12/82); and the FBI agents and Strike Forceattorneys preparing the Angiulo case should be alert to possibleviolence against them. Id. All of this information was highlyvalued by the FBI as it prepared the Angiulo case.

Bulger and Flemmi also gave the FBI information concerning thedrug dealing of Salvatore Michael Caruana and his claim to havebeen closely connected with Patriarca. Ex. 223. In addition, theyreported on the unsolved Blackfriar's murder case. Ex. 7.

Without any apparent concern that the information would be usedagainst him or his associates, Bulger told the FBI about the$200,000 his Winter Hill Gang borrowed from the Angiulos to dealwith the financial difficulties they were having due to illegalgambling losses. Ex. 73. Bulger also reported on some of theactivities of his Winter Hill associates. Ex. 127.

At the same time the FBI was receiving, but not investigating,reports from informants regarded as reliable concerning criminalactivity in which Bulger and Flemmi were engaged. For example, in1981 and 1982, the FBI was told that Bulger and Flemmi wereinvolved in cocaine distribution with Brian Halloran. Exs. 88,89. The Bureau was also advised that bookmakers were required topay Bulger and Flemmi to operate in South Boston. Exs. 89, 91.These allegations were not investigated by the FBI. Rather, withregard to Flemmi's reported drug activity, Connolly wrote that"source's contacts, at my direction, with individuals thought topossess information regarding [Judge Wood's] murder, may haveresulted in the false belief that source is involved innarcotics." Ex. 8.

13. The Wheeler, Halloran, and Callahan Murders

A serious threat to the ability of the Boston office of the FBIto continue to benefit from Bulger and Flemmi as sources arose onMarch 27, 1981, when Roger Wheeler was murdered in Tulsa,Oklahoma. Based on descriptions provided by witnesses, Bulger,Flemmi, and John Martorano, who was a fugitive, became primesuspects. The FBI in Boston, however, succeeded in keeping agentsfrom other offices and local law enforcement officials fromspeaking to Bulger and Flemmi. In addition, when Brian Halloranbecame a potential witness against Bulger and Flemmi in theWheeler homicide investigation, Morris told Connolly. As Morrisanticipated, Connolly told Bulger and Flemmi. Several weeks laterHalloran was murdered.

Wheeler owned World Jai Lai, which had facilities, known as"frontons," in Florida and Connecticut, where it was legal togamble on Jai Lai matches. Initially, Callahan, an accountant andassociate of Halloran's, was the President of the business.Morris Apr. 27, 1998 Tr. at 127-28. Rico, who had retired fromthe FBI in 1975, served as its Director of Security.

Wheeler suspected that Callahan was skimming money from WorldJai Lai for members of the Winter Hill Gang, including Halloran,Bulger, and Flemmi. MorrisApr. 27, 1998 Tr. at 128. Thus, he fired Callahan, put some ofhis own people in key positions, and began an audit. Id. Beforeit was concluded, however, Wheeler was shot and killed as he lefthis golf club in Tulsa. Sketches prepared on the basis ofdescriptions provided by witnesses, among other things, causedthe FBI and others to suspect that Bulger had murdered Wheeler.Fitzpatrick Apr. 16, 1998 Tr. at 96, 114, Apr. 17, 1998 Tr. at42-43, 175-76. Flemmi was also a suspect. Ex. 55. In addition, itwas believed that John Martorano may have been involved.

The FBI in Oklahoma City was interested in exploring Callahan'srelationship with Halloran, and in investigating Bulger andFlemmi. Morris Apr. 27, 1998 Tr. at 127. The FBI's BostonOrganized Crime squad opened an investigation to support OklahomaCity's effort to solve the Wheeler murder. Morris Apr. 27, 1998Tr. at 120. See also Aff. of Special Agent Stanley Moody, Apr.29, 1998 ("Moody Aff., Apr. 29, 1998"). In 1981, at Morris'request, Connolly interviewed Callahan as part of thatinvestigation. Morris Apr. 27, 1998 Tr. at 127-30. The Bostoninvestigation was then quickly closed. Id.

In January 1982, Halloran, who was facing a state murdercharge, began to cooperate with the FBI in Boston. Morris Apr.24, 1998 Tr. at 78, Apr. 27, 1998 Tr. at 115. Special Agents LeoBrunnick and Gerald Montanari, two members of the Boston FBI'sLabor and Racketeering squad, were assigned to work withHalloran. Morris Apr. 24, 1998 Tr. at 78, Apr. 27, 1998 Tr. at112-13. Among other things, Halloran told Brunnick and Montanarithat he had met Bulger and Flemmi at Callahan's apartment and wasasked if he was willing to murder Wheeler. Morris Apr. 22, 1998Tr. at 112, Apr. 27, 1998 Tr. at 114.

Brunnick consulted Morris, as the supervisor of the OrganizedCrime squad, to get his assessment of Halloran's reliability as apotential witness. Id. at 78-80. Brunnick told Morris aboutHalloran's allegations concerning Bulger and Flemmi. Morris Apr.24, 1998 Tr. at 83, Apr. 27, 1998 Tr. at 113-14, 127, 130. Morrisrealized that Halloran's allegations threatened their futures asFBI informants, among other things, because it was the Bureau'spractice to close sources that it was investigating. Morris Apr.24, 1998 Tr. at 74-77. Morris and Connolly did not want to losetheir prize sources, who were important to their investigations,and to their own status and future careers in the FBI. Id.Morris told Brunnick that Halloran was untrustworthy andunstable, and would not be a believable witness. Id. at 78-83.

The FBI in Oklahoma City had expressed interest in Halloran.Id. at 87. However, no evidence was introduced indicating thatany of its agents were informed of Halloran's discussions withthe FBI in Boston.

Morris, however, told Connolly that Halloran was speaking withBrunnick and Montanari, and of the information he was providingabout Bulger and Flemmi. Id. at 79, 87-88, Apr. 22, 1998 Tr. at112, 118. Morris expected that Connolly would tell Bulger andFlemmi about Halloran's charges. Morris Apr. 22, 1998 Tr. at112-13, 117. Morris knew that doing so would endanger Halloran.Morris Apr. 24, 1998 Tr. at 92. Connolly told Bulger and Flemmiabout Halloran's cooperation and claims. Morris Apr. 22, 1998 Tr.at 115-16, 118; Flemmi Aug. 20, 1998 Tr. at 20-21 (Lobby, UnderSeal), Aug. 26, 1998 Tr. at 81-84, Sept. 1, 1998 Tr. at 88-90;Boeri May 15, 1998 Tr. at 73, May 18, 1998 Tr. at 69-77; Ex. 41.

In early May 1982, the FBI denied Halloran's request to beplaced in the Witness Protection Program and told him that hisrelationship with the FBI was terminated. Morris Apr. 30, 1998Tr. at 8. See also Aff. of Supervisory Special Agent WilliamChase, Apr. 29, 1998 ("Chase Aff., Apr. 29, 1998"). On May 11,1982, Halloran was murdered as he emerged from a restaurantin South Boston. No one has ever been convicted of that murder.Morris, however, believed that Bulger and Flemmi wereresponsible. The next time that Morris asked Connolly to tipFlemmi off to an investigation, he added that he "did not wantanother Halloran" — meaning another murder. Morris Apr. 22, 1998Tr. at 121.

Morris did not, however, hesitate to capitalize on theextraordinary disclosure of highly confidential information thathe had caused Connolly to make to Bulger and Flemmi. At somepoint prior to Halloran's murder Connolly had told Morris thatBulger and Flemmi "really liked him," and hoped that Morris wouldlet them know if he ever needed anything. Morris Apr. 23, 1998Tr. at 135-36, 140, Apr. 24, 1998 Tr. at 97-99. Several weeksafter Halloran's murder Morris was sent to Glencoe, Georgia fordrug training. Ex. 240. At that time, although married, Morriswas romantically involved with his secretary. Id.; DeborahMorris Sept. 22, 1999 Tr. at 148.

While in Georgia, Morris decided that he would enjoy a visitfrom her. Morris Apr. 23, 1998 Tr. at 136. Recalling the offercommunicated through Connolly, he asked Connolly if Bulger andFlemmi would provide the funds necessary to buy his secretary aplane ticket. Id. at 136, 139.

Connolly subsequently gave Morris' secretary an envelopecontaining $1000 cash, which Morris understood had come fromBulger and Flemmi. Id.; Deborah Morris Sept. 22, 1998 Tr. at150. Flemmi denies that this payment was made. Flemmi Aug. 26,1998 Tr. at 104-05. Nevertheless, the court finds that Morris'understanding was correct. Connolly, however, told the secretarythat Morris had saved the money and wanted her to use it to visithim in Georgia. Morris Apr. 23, 1998 Tr. at 136-37; DeborahMorris Sept. 22, 1998 Tr. at 150-51. She took the money and madethe trip. Id.

Morris knew that the fact that Bulger and Flemmi had been toldby Connolly of Halloran's effort to cooperate with the FBI wouldbe relevant to any investigation of Halloran's murder, but henever provided this information to anyone in the FBI. Morris Apr.24, 1998 Tr. at 94-97. Nor did he tell the Suffolk CountyDistrict Attorney's Office, which conducted an investigation andobtained an indictment, but not a conviction, of Jimmy Flynn forthe Halloran murder. Id.

The Halloran murder presented a dilemma for the FBI. Itprecipitated a May 25, 1982 meeting at FBI Headquarters tograpple with Bulger and Flemmi's dual status as valuable FBIinformants and also suspects in the investigations of the Wheelerand Halloran murders. Ex. 54; Fitzpatrick Apr. 16, 1998 Tr. at94-102, Apr. 17, 1998 Tr. at 179. Representatives of the FBIoffices in Boston, Oklahoma City, and Miami met with FBIHeadquarters officials, including Sean McWeeney, Chief of theOrganized Crime Section, and Jeff Jamar, the InformantCoordinator. Id.

At the May 25, 1982 meeting, the Miami, Oklahoma City, andBoston offices of the FBI agreed to coordinate theirinvestigations of the Wheeler and Halloran homicides. Ex. 54. Itwas also agreed that O'Sullivan, as the Organized Crime StrikeForce Chief in Boston, and the United States Attorney in Oklahomawould discuss where any grand jury investigation should beconducted. Id.; Fitzpatrick Apr. 16, 1998 Tr. at 90, Apr. 17,1998 Tr. at 181.

In addition, a decision was made to keep Bulger and Flemmi openas sources unless and until "substantiated information"implicating them in the murders was received. Ex. 54; FitzpatrickApr. 17, 1998 Tr. at 180. It does not appear that there was anydiscussion of whether Bulger and Flemmi had immunity that wouldprotect them from possible prosecution for the Wheeler orHalloran murders. Nor does it appear that the implications of theAttorney General's Guidelines concerning informants wereconsidered. More specifically,there was evidently no discussion of whether local lawenforcement authorities in Boston or Oklahoma, which wereconducting investigations, should be advised of the informationHalloran had provided concerning Bulger and Flemmi or of whetherthe Assistant Attorney General should have been consulted.

On August 4, 1982, the body of John Callahan was found in thetrunk of his car in Miami, Florida. Apr. 17, 1998 Tr. at 184. Hehad evidently been dead for several weeks.

On September 23, 1982, Flemmi was administratively closed as aninformant. Ex. 83. Connolly and Morris told FBI Headquarters thatthey were closing Flemmi because he was being targeted forpossible prosecution in the 98 Prince Street and 51 North Margininvestigations. Id.; Morris Apr. 28, 1998 Tr. at 15-20. Thiswas not true. Morris Apr. 28, 1998 Tr. at 20; Ring June 10, 1998Tr. at 40.

As in the past, Flemmi was not told he had beenadministratively closed as a source. Morris Apr. 28, 1998 Tr. at23; Flemmi Aug. 29, 1998 Tr. at 33. In any event, Flemmicontinued to provide information regularly to the FBI. Exs. 224,265. Indeed, the records reflect forty-six contacts betweenFlemmi and the FBI between February 1983 and May 1986, a periodwhen Flemmi was administratively closed as a source. Id. Therewas no diminution in Bulger's official status as an informant.Rather, as discussed infra, in February 1983, Bulger waselevated to Top Echelon status. Ex. 11.

Nevertheless, Montanari attempted to investigate whether Bulgerand/or Flemmi played a role in the Wheeler homicide and relatedmatters. Pursuant to standard practice, the files of hisinvestigation were kept in an area that was accessible to otheragents. Montanari, however, suspected that Connolly wassurreptitiously reviewing those files and furnishing informationabout his investigation to Bulger and Flemmi. Fitzpatrick Apr.16, 1998 Tr. at 103-05, Apr. 17, 1998 Tr. at 191-92. Hecomplained to Fitzpatrick, who was sufficiently concerned that helocked the files in his own office. Id.

While Fitzpatrick secured the files in an effort to keep theinformation Montanari was developing away from Connolly, he didnot want anyone outside of the Boston office of the FBI to haveaccess to Bulger and Flemmi. In April 1983, the FBI in OklahomaCity sought authority from the Director of the FBI to interviewBulger and Flemmi. Ex. 53. Fitzpatrick strongly and successfullyopposed this request. Id.; Fitzpatrick Apr. 17, 1998 Tr. at184-86. In doing so, Fitzpatrick claimed that he had interviewedBulger concerning the Wheeler and Callahan murders, and thatBulger had denied being involved. Id. As Fitzpatrick testified,this was not true. Fitzpatrick Apr. 17, 1998 Tr. at 47, 184-86.Fitzpatrick had never questioned Bulger on these subjects. Id.at 184-86. Although he himself did not trust Connolly fully,Fitzpatrick also argued that Oklahoma City should not be allowedto interview Bulger and Flemmi in part because Connolly was incontinual contact with them and was disseminating all relevantinformation that he received regarding the Wheeler and Callahanmurders. Id.; Ex. 53. In essence, the Boston office of the FBIwas determined to control the information, and therefore thedecisions to be made, concerning its prize informants.

In May 1983, shortly after Fitzpatrick prevented FBI agentsfrom Oklahoma City from interviewing Bulger and Flemmi, Connollyurged the SAC to reopen Flemmi as an informant because he wascontinuing "to voluntarily furnish sensitive information of anextremely high quality." Ex. 55. Thus, Connolly argued that ifFlemmi was not going to be indicted imminently as a result of theWheeler, Callahan, or 98 Prince Street investigations, he shouldbe restored to Top Echelon informant status. Id. The timing ofthis memorandum suggests that it may have been, in part, anattempt by Connolly to determinewhether there was a threat that Flemmi would soon be charged as aresult of the Halloran and Callahan murder investigations.

The FBI in Boston did not, however, immediately act onConnolly's request. Rather, Ring, the new supervisor of theOrganized Crime squad, ordered that Bulger and Flemmi come in tothe Boston office to be photographed, as requested by the FBI inOklahoma, and to be interviewed by Montanari. Ring June 18, 1998Tr. at 46-48. Ring told Montanari, however, that he did not wantto be told anything about the progress of his investigation, butwhen it was concluded he hoped Montanari would give him hisopinion on whether Bulger and Flemmi were involved in the Wheelerand Callahan murders. Ring June 18, 1998 Tr. at 48.

Although Connolly resisted Ring's request by claiming that hedid not believe that Bulger and Flemmi were involved in thehomicides, Ring did not relent. Id. at 52-53. As a result, inNovember 1983, Bulger and Flemmi were interviewed together byMontaneri and Brendan Cleary. Id.; Exs. 75 (Under Seal), 227.

It was highly unusual for two subjects of an investigation tobe interviewed together. Bulger and Flemmi denied any involvementin the Wheeler and Callahan murders. Exs. 75 (Under Seal), 227.They refused, however, to take a polygraph examination andobjected to being photographed. Id. Ring recalls that the FBIdid photograph them. Ring June 10, 1998 Tr. at 50. No suchphotographs, however, were produced in discovery or introduced asevidence.

No one has ever been charged with committing the Wheeler andCallahan murders. Officially, those investigations remain open.The FBI in Boston, however, departed from the Bureau's standardprocedures to render the information that it had received fromHalloran regarding Bulger and Flemmi virtually inaccessible toothers who might wish to review or evaluate it.

More specifically, in 1982 and 1983, FBI reports containingallegations against an individual were to be indexed by thatindividual's name and placed in an investigative file. SeeMoody Aff., Apr. 29, 1998, ¶ 5. With one exception, however, themany reports containing Halloran's charges against Bulger andFlemmi were not properly indexed with a reference to their names.Id. at ¶ 5-6; Apr. 17, 1998 Tr. at 8, Apr. 24, 1998 Tr. at20-21, Apr. 30, 1998 Tr. at 4-10. Thus, these documents were notfound or considered by the Department of Justice officials whowere assigned, in July 1997, as a result of this case to reviewallegations that had been made by informants and witnessesagainst Bulger and Flemmi. See Chase Aff., Apr. 29, 1998.

Nor, when found by the Boston office of the FBI, were thedocuments promptly produced to the defendants as required by thisCourt's June 26, 1997 Order and other rulings. June 26, 1997Order, ¶ 4(c); Moody Aff., Apr. 29, 1998; May 5, 1998 Tr. at 2-12(Lobby, Under Seal). If the documents had been produced in atimely manner, Rico and Morris could have been questioned aboutthem. None of the documents, however, were provided to thedefendants at the time Rico testified in January 1998. Inaddition, some documents relating to Halloran's charges againstFlemmi and Bulger that should have been produced in connectionwith Morris' appearance were not disclosed until his lengthytestimony was complete. However, Special Agent Moody, who hadfound the Halloran documents, had provided them long before toBoston ASAC Mike Wolf and SAC Barry Mawn to review because theinformation that they contained "was obviously highly singularand sensitive." Moody Aff., Apr. 29, 1998, ¶ 4, Aff. of SpecialAgent Stanley Moody, May 5, 1998 ("Moody Aff., May 5, 1998"), ¶2; May 1, 1998 Tr. at 3-8.

Both Flemmi and the government had reasons to hope thatHalloran's allegationsagainst Flemmi and Bulger would not be fully exposed or resolvedin this case. From Flemmi's perspective, a thorough explorationof the Halloran charges might prove that he participated inmurder. From the FBI's perspective, exposure of its agents'conduct had the foreseeable potential to reveal an extraordinaryeffort to protect Bulger and Flemmi that involved seriousimpropriety, if not illegality. In any event, neither Morris norRico was recalled as a witness.

As a result of the delayed disclosure of the Halloran documentsby the government and of the failure of the adversary system tooperate fully and effectively on this issue, questions remainregarding the role, if any, played by Flemmi and Bulger in theWheeler, Halloran, and Callahan murders, and the full degree towhich the FBI in Boston has, from 1981 until recently, attemptedto keep any such role from being discerned and demonstrated.

14. The FBI Identified Other Informants for Flemmi and Bulger

Halloran was not the only informant that the FBI identified forBulger and Flemmi. Flemmi Aug. 20, 1998 Tr. at 16-17, 134-36,Aug. 20, 1998 Tr. at 2-23 (Lobby, Under Seal). Rico disclosed theidentity of several informants to Flemmi. Flemmi Aug. 20, 1998Tr. at 14-21 (Lobby, Under Seal). Connolly identified for Bulgerand Flemmi at least a dozen individuals who were either FBIinformants or sources for other law enforcement agencies. FlemmiAug. 20, 1998 Tr. at 2-23 (Lobby, Under Seal). These disclosureswere usually made so that Bulger and Flemmi could avoid makingany unnecessary, incriminating statements to other informants.Flemmi Aug. 20, 1998 Tr. at 16-17, Aug. 20, 1998 Tr. at 10-11(Lobby, Under Seal).

The evidence raises a question of whether Connolly also toldBulger and Flemmi about John McIntyre, who was providinginformation about them and their associates, and who disappearedabout six weeks after the FBI learned of his allegations. Thisquestion cannot, however, be resolved on the present record, inpart because of the delayed disclosure of documents by thegovernment and in part because, as with Halloran, it evidentlywas not in either the interest of Flemmi or of the FBI to havethis issue fully developed in this case.35

In mid-October 1984, McIntyre began cooperating with RichardBergeron of the Quincy Police Department. Bergeron June 4, 1998Tr. at 24-26. McIntyre reported, among other things, that heworked for Joseph Murray, initially in drug dealing. Id.; Ex.257. McIntyre also revealed that he was the engineer on a shipnamed the Valhalla, which had been used in an attempt to deliverguns and ammunition from Massachusetts to the Irish RepublicanArmy (the "IRA") in Ireland. Bergeron June 2, 1998 Tr. at 113-24,June 4, 1998 Tr. at 24-26. McIntyre said that Murray secretlyowned the Valhalla. Bergeron June 2, 1998 Tr. at 115. McIntyrealso explained that Murray was closely connected to Bulger andthat Bulger, through his associates Kevin Weeks and Patrick Nee,was involved in the Valhalla arms shipment. Bergeron June 2, 1998Tr. at 117-18, 123, June 4, 1998 Tr. at 17-18, 24-25. Flemmi wasalso mentioned. Bergeron June 2, 1998 Tr. at 116, June 4, 1998Tr. at 128.

McIntyre was willing to cooperate with law enforcement, butseemed to Bergeron to be too "petrified" of the people that hewas discussing to be a potential witnesswhose cooperation would be publicly disclosed. Bergeron June 4,1998 Tr. at 25, 35-36. Bergeron realized that the informationMcIntyre was providing would be significant to several federallaw enforcement agencies. Id. at 24-25. Thus, he immediatelyarranged for agents of the DEA and the United States CustomsService ("Customs") to participate in the debriefing of McIntyre.

In addition, Bergeron told FBI Special Agent Roderick Kennedythat McIntyre was cooperating and, among other things, ofMcIntyre's charges against Bulger and his associates. BergeronJune 2, 1998 Tr. at 113, 116, June 4, 1998 Tr. at 25, 28. Kennedywas the FBI's operational liaison with other agencies concerningnarcotics matters.

At the time Bergeron contacted him, Kennedy knew that Bulgerand Flemmi were Connolly's informants. Kennedy Apr. 14, 1998 Tr.at 26, 115-16, 121, 144. In fact, in 1983, Connolly told Kennedythat Bulger had disclosed that he had extorted $60,000-$90,000 in"rent" from Murray because Murray was storing marijuana in awarehouse in South Boston, which was part of Bulger's territory.Id. at 62-63, 79, 115, 121-29.

Kennedy had participated with the DEA in a raid of thatwarehouse. Id. at 100-15. Kennedy did not, however, share theinformation he received from Connolly with the DEA, with which hewas conducting an ongoing joint investigation, or with theprosecutors working on the case. Id. at 111-14, 121-29, 130-32.Nor did he use that information in any of the FBI's independentefforts. Id. at 133-34.

Kennedy knew that Connolly expected confidentiality concerningthe information Bulger had provided. Id. at 123. Like hiscolleagues going back to Rico, Kennedy understood implicitly thatan informant's statements could not properly be used against him.In any event, Kennedy was willing to subordinate the interests ofinvestigations in which he was involved to the interest thatConnolly and the FBI had in Bulger and Flemmi as sources.

Although he did not disclose that Bulger and Flemmi were FBIinformants, Kennedy, with a Customs Agent, interviewed McIntyreon October 17, 1984. Exs. 257, 258. With regard to drugs,McIntyre told Kennedy that "an individual named WHITEY whooperates a liquor store in South Boston [had become] partnerswith JOE MURRAY." Ex. 257. Kennedy recognized this as a referenceto Bulger who, as discussed in § II.15, infra, was at that timean owner of the South Boston Liquor Mart. McIntyre also recountedthe story of the Valhalla, including the role of Bulger'sassociate Patrick Nee, who had traveled to Ireland to meet theshipment of guns. Ex. 258. Kennedy reported the information thathe received from McIntyre to the SAC. Exs. 257, 258.

It is not clear whether Kennedy also discussed McIntyre'scharges with Connolly. The reports of his interview withMcIntyre, Exs. 257, 258, were not, as required by the court'sJune 26, 1998 and December 27, 1998 Orders, and the government'spractice concerning "Jencks" materials, produced before Kennedytestified. June 5, 1998 Tr. at 4-5, June 22, 1998 Tr. at 117-19,Oct. 23, 1998 Tr. at 113-20. Rather, the documents were producedonly after the court ordered that the FBI search for them. June2, 1998 Tr. at 134-35. No party recalled Kennedy to testify aboutthe McIntyre matter or questioned him concerning it when thecourt directed that he appear to be interrogated concerningRaymond Slinger, as described infra.

Kennedy had earlier acknowledged, however, that he and Connollyoften exchanged information. Kennedy Apr. 14, 1998 Tr. at 26. Inaddition, the evidence concerning Murray's warehouse and theSlinger matter indicate that Kennedy on other occasionsparticipated in protecting Bulger and Flemmi from investigationand possible prosecution. Thus, there is circumstantial evidenceto suggest that Kennedymay have told Connolly about McIntyre's cooperation and claimsand, in view the Halloran matter, reason to be concerned thatConnolly may have told Bulger and Flemmi. These issues cannot,however, be resolved on the present record.

In any event, despite the obvious potential for McIntyre'scooperation to result in several significant, if not sensational,cases, no evidence has been presented that the FBI conducted anyinvestigation based on McIntyre's charges concerning Bulger andFlemmi, or discussed with DEA or Customs deferring to anyinvestigation that they might conduct. Bergeron June 2, 1998 Tr.at 133-34. Several years later, there was a prosecution of anumber of people involved with the Valhalla. Reilly May 20, 1998Tr. at 46. The FBI did not in the course of its investigation askthe DEA whether it had any evidence linking Bulger or Flemmi tothe Valhalla. Id. at 46. If asked, the DEA could have reportedthat the electronic surveillance it conducted jointly with theFBI in 1984 and 1985, discussed in § II.17, infra, "showed thatBulger and Flemmi shipped guns and ammunition to the IRA inIreland." Ex. 145. More specifically, the electronic surveillancerecorded that upon seeing a news report that the Valhalla hadbeen seized, Bulger exclaimed: "That's our shipment. That'sours." Id. at 74-75. Bulger and Flemmi were not, however,charged in the Valhalla case.

On December 6, 1984, the Quincy Police realized that McIntyrehad disappeared. Ex. 155; Bergeron June 2, 1998 Tr. at 139. OnlyKennedy and a Customs agent were informed immediately. Id. Itwas assumed that McIntyre had been killed. Neither he nor hisbody has ever been found.

Bergeron suspected that Bulger might have been involved inMcIntyre's murder, in part because McIntyre's father reportedthat his son was going to meet Patrick Nee on the night that hedisappeared. Bergeron, June 2, 1998 Tr. at 39. Bergeron had heardrumors that Bulger and Flemmi were FBI informants, but did notbelieve them. Bergeron June 2, 1998 Tr. at 152-55. Bergeron knewthat Bulger and Flemmi had been linked to several murders. Id.at 154. Validating the view that Bulger had expressed severalyears before to Sarhatt, Bergeron testified that he "didn't thinkthat somebody at that level, doing what they [Bulger and Flemmi]were doing, could be informants for the FBI." Id.

15. The South Boston Liquor Mart

In about January 1984, Connolly received very reliableinformation concerning an ongoing extortion by Bulger and Flemmi.In violation of FBI policy and practice, Connolly did not recordthe information or disclose it to his Supervisor as required bythe FBI Guidelines. Nor did he try to obtain the testimony of thevictims or conduct any other investigation. Instead, he toldBulger of the charges.

In January 1984, Joseph Lundbohm was a Boston Police Detective.Lundbohm Sept. 29, 1998 Tr. at 112-18. Lundbohm's niece, JulieRakes, and her husband Stephen had recently bought a liquor storein South Boston. Id. at 116.

Bulger and Flemmi evidently decided that the store would be anexcellent hub for their activities. They, and Kevin Weeks,visited the Rakes and said they wanted to buy the liquor store.Id. The Rakes told them that it was not for sale. Id. Flemmiresponded by pulling out a gun, commenting on how lovely theRakes' young child was, and reiterating that they were going tobuy the liquor store. Id. at 116-17.

The Rakes sought Lundbohm's assistance, telling him whatoccurred. Id. at 116. Lundbohm knew that Bulger and Flemmi werereputed to be dangerous members of organized crime. Id. at 138.He felt that the FBI would be the most appropriate lawenforcement agency to investigate the ongoing extortion. Id. at134. He did not know that Bulger andFlemmi were FBI informants, or that Connolly was their handler.Id. at 123, 145.

Lundbohm was acquainted with Connolly professionally, knew thathe was involved in investigating organized crime and, with theRakes' consent, decided to speak with Connolly in an effort toprompt an FBI investigation. Id. at 118. Lundbohm related toConnolly what the Rakes had told him. Id. at 119. Connollyasked whether the Rakes would "wear a wire" to recordconversations with Bulger, Flemmi, and Weeks. Id. at 119, 126.Lundbohm indicated that he would advise them not to do so. Id.Connolly responded that he would take the information, but didnot feel that there was much that the FBI could do. Id.

Connolly made no record of the information Lundbohm hadprovided to him. Nor did he disclose it to Ring, who had becomethe Acting Supervisor of the Organized Crime squad in January1983. Ring June 4, 1998 Tr. at 44.

Connolly did, however, tell Bulger of his conversation withLundbohm. Bulger subsequently urged the Rakes to "back off."Lundbohm Sept. 29, 1998 Tr. at 122. Lundbohm correctly inferredthat Bulger had learned that the Rakes had been trying togenerate an FBI investigation of him. Id. at 122, 139-40.

The FBI did not investigate the extortion of the Rakes in anyway. More specifically, Connolly did nothing to attempt to obtainthe testimony of Mr. and Mrs. Rakes. Nor did he do anything elseto acquire evidence of the effort of Bulger and Flemmi tofrighten them into selling their liquor store.

In any event, the extortionate scheme succeeded. The Rakesreluctantly sold their liquor store to Bulger and Flemmi. Id.at 117. It was re-named the South Boston Liquor Mart, and in thenear future became a focus of the investigative efforts ofseveral law enforcement agencies, not including the FBI.

16. Greenleaf Becomes SAC and Ring Becomes Supervisor of the Organized Crime Squad

In November 1982, James Greenleaf became the FBI SAC in Boston.Greenleaf Jan. 8, 1998 Tr. at 7. He served in that capacity untilDecember 1986. Id. While the SAC, Greenleaf delegated theresponsibility for recommending the opening and closing ofinformants to the agent who was his handler. Id. at 171-72. Thehandler, acting in concert with his supervisor, was also giventhe responsibility for any review of the informant's status thatbecame necessary. Id. As described earlier, in this period theAttorney General's Guidelines, which had been incorporated in theFBI's Manual, required that the SAC himself make certaindecisions, including, after consultation with the United StatesAttorney, whether to authorize extraordinary criminal activityinvolving a "serious risk of violence," and "reviewing all suchcriminal activity at least every 90 days." Ex. 274 (Under Seal),Manual § 137 F.(2) and (3) (1-12-81). Greenleaf's approach,however, had the practical effect of delegating theseresponsibilities, among others, to an informant's handler and hissupervisor.

While SAC, Greenleaf knew that Bulger was an FBI informant.Greenleaf Jan. 8, 1998 Tr. at 136-38. He also knew that althoughFlemmi may have been technically closed as an informant, he wasconstantly in the company of Bulger and was regularly providinginformation to the FBI. Id. Greenleaf was well aware thatConnolly was the handler for both Bulger and Flemmi. Id.Consistent with his usual practice, Greenleaf generally relied onConnolly and his supervisor to deal with Bulger and Flemmi, andwith any matters relating to them. Id. at 136-40.

In January 1983, Greenleaf made James Ring the Supervisor ofthe Organized Crime squad. Ring June 4, 1998 Tr. at 44. Ring heldthat position until he retired in 1990. Id. When replaced byRing, Morris became the FBI Supervisor of the new, interagencyOrganized Crime Drug EnforcementTask Force ("OCDETF"). Morris Apr. 21, 1998 Tr. at 14.

In the course of the transition, Morris spoke with Ring aboutBulger and Flemmi. Morris Apr. 29, 1998 Tr. at 65-66; Ring June10, 1998 Tr. at 34-36. Morris told Ring that, in his opinion,Bulger and Flemmi "had outlived their usefulness." Morris Apr.29, 1998 Tr. at 66, Apr. 30, 1998 Tr. at 91. Morris recognizedthat Bulger and Flemmi "looked like they were going to do apretty good number on the LCN" and would, as a result, becomemore powerful in the criminal community. Morris Apr. 29, 1998 Tr.at 66. Thus, Morris suggested that Ring terminate Bulger andFlemmi as sources. Id.36

Ring did not, however, seek to have Bulger closed as aninformant. Rather, on February 23, 1983, he approved amemorandum, prepared by Connolly, to FBI Headquartersrecommending that Bulger be elevated to Top Echelon informantstatus. Ex. 11; Ring June 11, 1998 Tr. at 22-24. Although thememorandum was captioned as coming from the SAC, pursuant to hisnormal practice of relying on subordinates with regard toinformant matters, Greenleaf did not see it. Greenleaf Jan. 8,1998 Tr. at 140.

The memorandum characterized Bulger as "one of the most highlyplaced and valuable informants in the Boston Division." Ex. 11.The memorandum then explained that:

[Bulger] is the titular head of the Winter Hill Mob and as such sits as an equal at the policy making level with major Boston LCN figures, to include Gennaro Angiulo, Underboss of Raymond Patriarca, and Boston Capo Illario Zannino, a/k/a Larry Baione. To date, this source has been utilized in six (6) successful affidavits in support of six (6) applications of court authorized electronic surveillances under the provisions of Title III. These electronic surveillances involved matters targeting the LCN at the policy making level. One of the two cases in which electronic surveillance has been utilized has been characterized by FBIHQ officials as "one of the most important and successful Title III's conducted by the FBI in the past ten years." Information provided by source has run the gamut from identifying individuals who have been marked for execution by the LCN, allowing law enforcement to advise these individuals of their status, to providing information on policy changes in the Boston-Providence LCN structure to include the recruiting of new LCN members.

UACB, captioned source will be converted to [Top Echelon] status and will continue to be targeted for ever increasing productivity.

Ex. 11.

On May 26, 1983, Connolly wrote a memorandum to "SAC Boston(ATTN Acting Supervisor J.A. Ring)," requesting a determinationof whether Flemmi would imminently be indicted as a result of theWheeler-Callahan investigations or in the case arising fromelectronic surveillance at 98 Prince Street. Ex. 55. Connollybased his request on the fact that Flemmi "continues tovoluntarily furnish sensitive information of an extremely highquality." Id.

As indicated earlier, no action was taken immediately onConnolly's request. Nevertheless, Connolly was correct incontending that Flemmi was continuing to provide very valuableinformation to the FBI.

For example, on February 1, 1983, Flemmi told Connolly thatGennaro Angiulo could normally be found at Francesco's Restauranton Monday, Tuesday, and Friday nights. Exs. 79, 172. Flemmi alsofurnished a drawing that he had made ofthe restaurant, including the back room where Angiulo sat. Ex.172. In addition, he reported on eleven people who met withAngiulo at Francesco's, including, according to the 209, Flemmihimself, who was described as being with "a young, good lookinggirl." Exs. 79, 172. Angiulo was indicted in September 1983. SeeUnited States v. Angiulo, 755 F.2d 969 (1st Cir. 1985). The FBIarrested him at Francesco's.

On February 1, 1983, Flemmi also told Connolly that Zanninoregularly met members of his regime and others on Monday andTuesday evenings at the Bella Napoli restaurant. Ex. 171. Onceagain, Flemmi provided a diagram of the restaurant, indicatingwhere Zannino sat to conduct business. Id. Flemmi reported,however, that Zannino had become more careful about discussingcriminal matters, but still did so freely in Domenic Isabella'sautomobile. Id. See also Ex. 237 (209s dated 2/23/83 and5/17/83). Both Flemmi and Bulger were used as sources in thesuccessful August 1983 application for a warrant to conductelectronic surveillance of Isabella's car. Coffey Aff., Apr. 9,1997, ¶ 3.C.

In the fall of 1983, Connolly and Morris had dinner with Bulgerand Flemmi at Flemmi's parents' home in South Boston. Flemmi Aug.20, 1998 Tr. at 97-98. The LCN was, as always, discussed. FlemmiAug. 20, 1998 Tr. at 64. The timing of the meeting suggests thatthe occasion was a celebration of the Angiulo indictments.

If that meeting was a celebration of the Angiulo indictments,Ring, who was then the head of the Organized Crime squad andConnolly's supervisor, was not invited. This may have beenbecause Ring had criticized Connolly for bringing him to anothermeeting at Flemmi's parents' home. Ring June 10, 1998 Tr. at94-97.

By the fall of 1983, Ring had met Bulger and Flemmi twice.Flemmi Aug. 20, 1998 Tr. at 80-84. The first time Ring went withConnolly to Bulger's apartment. Id. at 81-82. The secondmeeting involved a dinner that Connolly arranged at Flemmi'sparents' home. Id. at 82-84.

Ring used these occasions, in part, to observe and evaluateConnolly's interaction with Bulger and Flemmi, and did not likewhat he saw. Ring June 10, 1998 Tr. at 87-100. Ring consideredthe meeting at Flemmi's parents' home to be "extraordinary,""stupid," and "not an appropriate way to be dealing withinformants." Id. at 94-95. Ring particularly felt that it wasimproper for FBI agents to meet with sources in the presence ofthird parties. This feeling was heightened when Bulger's brother,William, who was the President of the Massachusetts Senate andlived next door to the Flemmis, came to visit while Ring andConnolly were there. Id. at 92-93.

Ring perceived that Connolly was treating Bulger and Flemmilike "friends" or "consultants" rather than as informants. RingJune 22, 1998 Tr. at 51-52. For example, Connolly was givingBulger and Flemmi information and asked Ring to do the same.Id. Ring expressed to Connolly his concern about what he hadobserved, and his view that the meeting at Flemmi's parents' homewas particularly inappropriate. Ring June 10, 1998 Tr. at 95-97,June 22, 1998 Tr. at 51-52.

Ring did not, however, discipline Connolly or alter hisresponsibilities concerning Bulger and Flemmi. June 10, 1998 Tr.at 96. Nor did Ring then advise the SAC of what had occurred andthe problems that he perceived. Id. at 98. Moreover, while itwas generally Ring's practice to require agents under hissupervision to obey the requirement, set forth in the FBI Manual,that all contacts with an informant be recorded promptly on a 209even if no positive information was received, there is no 209relating to the meeting that Ring attended at Flemmi's parents'home. Ring June 15, 1998 Tr. at 59-60, June 10, 1998 Tr. at97-98. In addition, Ring did not make a record of his admonitionsto Connolly. Ring June 10, 1998 Tr. at 97-98.

In 1983 and 1984, Ring knew that Bulger and Flemmi were engagedin "a whole host of criminal activities." Ring June 11, 1998 Tr.at 24. Indeed, Ring expected them, and other informants, to beinvolved in criminal activity. Id. at 92. Ring felt that theInformant Section at FBI Headquarters was well aware, from theopening teletypes, of the range of criminal activity in whichBulger and Flemmi were involved and their status in the criminalcommunity. Ring Sept. 22, 1998 Tr. at 42-45. Headquarters askedno questions and Ring did not perceive a need to provide updatedinformation on Bulger and Flemmi's criminal activities. Id.

Shortly after becoming Supervisor of the Organized Crime squad,Ring considered the implications of the Attorney General'sGuidelines for Organized Crime informants. Ring June 19, 1998 Tr.at 134. He also discussed this subject with Morris. Id. at 135.Ring felt that the Guidelines process for providing authorizationto an informant to commit crimes was not feasible for OrganizedCrime informants, in part because utilizing it would, as heunderstood it, require discussion and disclosure of theinformant's identity. Id. at 134-37. Morris told Ring thatseeking authorization for criminal activity of Organized Crimeinformants was not "worth the aggravation." Id. at 135. Ringagreed. Id.

In Ring's view, the FBI knew its informants were engaged incriminal activity, but they were not authorized to commit crimes.Id. Thus, if someone caught them, they were subject toprosecution. Id. Ring did not interpret the Guidelines asrequiring that he report information he learned about crimescommitted by informants for the Organized Crime squad to other,interested law enforcement agencies, or to FBI Headquarters andthe Assistant Attorney General. Rather, he believed that he wasonly required to tell Headquarters if an informant was arrested,indicted, or targeted in an order authorizing electronicsurveillance. Ring June 22, 1998 Tr. at 17-18.

Although Ring did not regard his squad's informants asauthorized to engage in criminal activity, he believed that itwould have been unfair and improper for the government to attemptto use information that a source provided against him. Ring June22, 1998 Tr. at 46-52. He also felt that it would be unwise,because if an informant perceived that the FBI might useinformation he provided against him, he would quickly ceaseserving as a source. Id. at 49-50. In any event, Ring neverparticipated in any discussion in which Bulger and Flemmi weretold that the information that they were providing could be usedagainst them. Id. at 50. Nor did he see any document indicatingthat they had been given such a warning. Id.

As indicated earlier, the record does include documentscertifying that at various times Connolly gave Bulger and Flemmithe annual warnings required by the Attorney General'sGuidelines, including the warning that they were not protectedfrom prosecution for any criminal activity unless it wasauthorized by the SAC or a Supervisor. Ex. 43; Gianturco Jan. 20,1998 Tr. at 151-53. Flemmi denies that he ever received any suchwarning. Flemmi Aug. 28, 1998 Tr. at 133. The compelling evidenceof the FBI's enduring, assiduous effort to cultivate in Bulgerand Flemmi the sense that they were "friends," "consultants," andallies rather than informants, among other things, persuades thecourt that Flemmi's contention is correct.

Bulger and Flemmi never discussed with Ring whether theirrelationship with the FBI would afford them any protection orimmunity. Ring Sept. 18, 1998 Tr. at 126-29. Ring did not tellthem that they had immunity or would be protected. Id. Nor didhe express to them his view that if they were caught engaging incrime, they were "on their own," meaning subject to prosecution.Ring June 19, 1998 Tr. at 144. The protection that the FBI wouldprovide its valuable sources was an issuethat Rico, Connolly, Morris, Flemmi, and Bulger were comfortablediscussing with each other. This was not true, however, withregard to Ring, Bulger, and Flemmi.

After having some experience as the Supervisor of the OrganizedCrime squad, Ring recommended to Greenleaf that a new,Non-Traditional Organized Crime squad be established. Ring June11, 1998 Tr. at 98, June 22, 1998 Tr. at 54-55. Greenleaf agreedand formed the new squad.

From Ring's perspective, the new squad had several advantages.It made it proper for him to focus his squad's work exclusivelyon the LCN. Ring June 22, 1998 Tr. at 54-55. It also removedresponsibility for investigations of Bulger and Flemmi from hissquad, which Ring felt would insulate him and the FBI from thecriticism that their handlers could not be trusted to investigateBulger and Flemmi, but rather would compromise the investigationsof their informants of which they became aware. Id.

While Ring believed that it was not proper for Bulger andFlemmi's handlers to be investigating them, he felt it waspermissible for others in the FBI to do so. Ring June 22, 1998Tr. at 47. As a practical matter, however, the creation of thenew squad did not imperil Bulger and Flemmi. Instead, as setforth below, when members of that squad received reliableinformation about criminal activity in which Bulger and Flemmiwere engaged, they regularly consulted Connolly and then did notpursue any investigation. Among those who participated in theprocess of consulting Connolly and then deferring to thecommitment he had made to protect Bulger and Flemmi were: ASACLarry Potts, Supervisory Special Agent Bruce Ellavsky, RodKennedy, and John Newton concerning the extortion of RaymondSlinger; James Blackburn regarding the extortion of a drugdealer; and James Lavin regarding guard rails constructed by theCity of Boston on the property of the South Boston Liquor Mart.As described below, contrary to FBI policy and practice, theimportant information provided by Slinger was never documentedand Lavin did not place the evidence he had received in the FBI'sfiles. Ring, however, never knew of any of this. Ring June 11,1998 Tr. at 98-100, June 22, 1998 Tr. at 54-57.37

17. The 1984-85 Electronic Surveillance

In 1984 and 1985, the DEA and the FBI were authorized by aseries of court orders to engage jointly in electronicsurveillance targeting Bulger and Flemmi. The investigation wasinitiated by the DEA. The DEA agents involved preferred not tocollaborate with the FBI, primarily because they, and theAssistant United States Attorney working with them, believed thatFlemmi and Bulger were FBI informants and that the Bureau wouldcompromise the confidentiality of the investigation to protectits sources. The Bureau preferred not to participate because itviewed the endeavor as doomed to fail and expected that, as withthe Lancaster Street Garage investigation, the FBI would beblamed. The two agencies became reluctant collaborators, however,when it was recognized that the FBI's participation was essentialif judicial authorization to conduct electronic surveillance wasto be sought and received because most of the information to berelied upon in the applications to establish probable causeinvolved gambling and loansharking — crimes that the FBIrather than the DEA had the federal responsibility toinvestigate.

The applications for the court orders authorizing theelectronic surveillance of Bulger, Flemmi, George Kaufman, andothers not only relied heavily on the evidence cited to establishthat there was probable cause to believe that they werecommitting offenses within the investigatory jurisdiction of theFBI, but also clearly conveyed the impression that the FBI wouldutilize any evidence obtained to attempt to develop prosecutablecases concerning matters within its jurisdiction. The Bureau,however, had no intention of doing so. The FBI was well aware,from information provided by Bulger, Flemmi, and others, thatBulger and Flemmi were engaged in illegal gambling, loansharking,and extortion. The FBI considered such criminal conduct to beessential to maintaining the credibility necessary for Bulger andFlemmi to continue to obtain and provide vital information on theLCN and others. The FBI was committed to honoring its promise ofconfidentiality to Flemmi and Bulger by not disclosing that theywere sources, explicitly or implicitly. Explaining to the DEA,the prosecutors, or the court, that the Bureau was not interestedin obtaining or using any intercepted evidence of their criminalconduct would have effectively confirmed that they wereinformants.

Ring, who was at the hub of the matter for the FBI, felt thatFlemmi and Bulger had no immunity and would be "on their own" ifthe DEA could develop a prosecutable narcotics case against thembased on the electronic surveillance. Armed with informationprovided by colleagues, however, Connolly contributed to assuringthat DEA's efforts would not succeed by alerting Bulger andFlemmi to the investigation generally and to the electronicsurveillance particularly.

As described in detail below, the FBI, blinded by itsdetermination not to confirm for the United State Attorney or theDEA the accuracy of their understanding that Bulger and Flemmiwere FBI informants, recklessly disregarded the government'slegal obligation of candor to the court when applying forauthority to conduct electronic surveillance in what wasrepresented to be a joint investigation. At the same time,believing that Bulger and Flemmi were FBI informants, butaccepting that the FBI would not confirm or discuss their status,the DEA and the United States Attorney's Office recklesslydisregarded their legal obligation to seek from the FBIinformation that, if shared with them, would have resulted in theapplications for electronic surveillance now at issue not beingfiled, let alone approved by the court. The DEA and United StatesAttorney's Office also acted with reckless disregard for thetruth when they filed an application for a warrant that in effectrepresented that electronic surveillance was necessary to obtainevidence that the FBI would use in a Title 18 investigation ofBulger, Flemmi, and others because the prosecutor who was theapplicant and the DEA agent who was the affiant did not believethat the FBI would conduct any such investigation. As a result,the applications for the 1984-1985 electronic surveillancetargeting Bulger and Flemmi failed to include the "full andcomplete statement" describing the necessity for its use that wasrequired by Title III.

More specifically, if submitted by a properly informedapplicant, the applications should have included certain materialfacts about the targets, including the following. As informantsBulger and Flemmi had made statements about their illegalgambling and loansharking that the government now claims can beused as evidence against them. A review of their files wouldindicate to the FBI that they were tacitly authorized to engagein such activities and, therefore, the conduct which thegovernment was seeking to investigate may not have been criminal.In any event, the FBI did not intend to use any evidencegenerated by the electronic surveillance in an attempt to developa prosecutable caseagainst its sources or any of the other named targets, includingGeorge Kaufman. Moreover, the FBI agent who was mostknowledgeable believed that Bulger and Flemmi were not involvedin narcotics crimes, but may have mistakenly given thatimpression while seeking information for the Bureau. Noreasonable judge would have granted any request to target Bulgerand Flemmi based on an application containing this information.

The DEA honestly and earnestly wished to conduct aninvestigation that it hoped would result in the successfulprosecution of Bulger and Flemmi for narcotics offenses. TheDepartment of Justice would not have allowed the submission tothe court of an application that it knew was misleading. Norwould it have, over the FBI's inevitable objection, permitteddisclosure to the court, and possibly to potential defendants, ofthe fact that Bulger and Flemmi were FBI informants. If, however,an application were filed seeking authority to intercept Bulgerand Flemmi to obtain evidence of drug offenses only, the initialrequest concerning Bulger would have been obviously unmeritoriousbecause there was not probable cause to believe that he would beintercepted discussing anything on Kaufman's telephone. Inaddition, the request concerning Flemmi would have been denied aswell because there was not probable cause to believe that Flemmiwould be discussing narcotics matters on Kaufman's telephone. Norwas there probable cause to believe that Kaufman would bediscussing drug offenses with anyone.

Thus, but for the material omissions caused by the government'sreckless disregard for the truth and for the obligations imposedby Title III and the Constitution, the warrants for the 1984-85electronic surveillance would not have issued. The facts on whichthis conclusion rests are set forth below.

By 1984, Bulger and Flemmi were considered by the Boston lawenforcement community to be "well known organized crime figures."Ex. 140. With the LCN diminished by the indictments of Angiulo,Zannino, and their colleagues, Bulger and Flemmi were alsoregarded as increasingly powerful and dangerous. Thus, in late1983, the DEA decided to attempt to develop the information, andobtain the resources, necessary to conduct electronicsurveillance of Bulger and Flemmi. Reilly May 19, 1998 Tr. at114.

Stephen Boeri and Albert Reilly were designated as the DEA caseagents for the investigation. Boeri May 14, 1998 Tr. at 28-29,39-40. Assistant United States Attorney Gary Crossen was laterassigned to work with them. Crossen had recently become anAssistant United States Attorney after serving as an AssistantDistrict Attorney for Suffolk County. Crossen May 11, 1998 Tr. at132.

Boeri, Reilly, and Crossen shared a genuine interest ininvestigating Flemmi and Bulger. Crossen May 11, 1998 Tr. at 143,May 12, 1998 Tr. at 131. It was not clear, however, whether theycould obtain the necessary resources or judicial authorizationfor electronic surveillance, which was an essential part of theirplan. Stutman Apr. 14, 1998 Tr. at 12. The government must investconsiderable manpower and money for a prolonged period of time toconduct electronic surveillance. Stutman Apr. 15, 1998 Tr. at 68;Reilly May 19, 1998 Tr. at 143-46. In this case, it was initiallyexpected that the investigation would take at least a year.Stutman Apr. 14, 1998 Tr. at 69. The approval of DEA Headquarterswas needed to conduct such a lengthy investigation with uncertainprospects. Id. If approved, resources would have to be foundand committed to fund it. Reilly May 19, 1998 Tr. at 133-34.Moreover, many months would have to be devoted to attempting toobtain the information necessary to receive authorization fromthe Department of Justice to apply for a judicial warrant toconduct electronic surveillance, and to make a compelling casefor the issuance of such an order.

At the outset of their investigation, Boeri and Reilly wereconvinced that Bulger and Flemmi were FBI informants. StutmanApr. 15, 1998 Tr. at 36-37; Reilly May 19, 1998 Tr. at 123;Kennedy Apr. 14, 1998 Tr. at 143-44. Crossen also believed thatBulger and Flemmi were "in the FBI stable of informants." CrossenMay 11, 1998 Tr. at 149-50. Crossen, Boeri, and Reilly had allbeen told about the Lancaster Street Garage experience. CrossenMay 12, 1998 Tr. at 114; Boeri May 14, 1998 Tr. at 67-70; ReillyMay 19, 1998 Tr. at 123-24; Ex. 146. This contributed to theirbelief that Bulger and Flemmi were not only FBI sources, butinformants that the FBI wished to protect. They felt, however,that serving as an informant did not prevent an individual frombeing investigated and prosecuted if he were also committingcrimes. Crossen May 13, 1998 Tr. at 28-29; Boeri May 14, 1998 Tr.at 70.

Their belief that Bulger and Flemmi were highly valued FBIinformants presented Crossen, Boeri, and Reilly with a dilemma.In planning their investigation they hoped to develop sufficientevidence that Bulger and Flemmi were involved in gambling andextorting money from drug dealers to obtain a warrant forelectronic surveillance targeting them in order to acquireevidence of those crimes, as well as narcotics offenses. CrossenMay 11, 1998 Tr. at 151-52, May 13, 1998 Tr. at 52-53; Boeri May14, 1998 Tr. at 41, 64. Crossen believed that the investigationgenerally, and any effort to obtain a court order to conductelectronic surveillance particularly, would have to include a lawenforcement agency with the authority to investigate for possibleprosecution gambling and other, relevant non-narcotics offensesbecause evidence of such offenses was expected to be overheard.Crossen May 13, 1998 Tr. at 90-91. See 18 U.S.C. § 2516(1)(1994) ("judge may grant . . . an order authorizing or approvingthe interception of wire or oral communications by the FederalBureau of Investigation, or a Federal agency havingresponsibility for the investigation of the offense as to whichthe application is made. . .").

It was also understood by Crossen, the DEA agents, and theirSAC, Robert Stutman, that the DEA did not have the authority orfederal responsibility to investigate non-narcotics offenses.Crossen May 13, 1998 Tr. at 151-53; Boeri May 14, 1998 Tr. at61-63; Stutman Apr. 15, 1998 Tr. at 14. Rather, the FBI was thefederal agency that had the jurisdiction and responsibility toinvestigate gambling, loansharking, extortion, and other conductconstituting federal crimes under Title 18 of the United StatesCode. Id. Crossen and his colleagues recognized, however, thatthe Massachusetts State Police were also empowered to investigategambling, loansharking, and extortion, which are crimes under thelaws of Massachusetts as well as federal offenses. Crossen May11, 1998 Tr. at 152.

Boeri and Reilly had a strong preference for working with theMassachusetts State Police rather than the FBI. In 1984, the FBIand DEA had an unhappy history as rivals. Ahearn May 11, 1998 Tr.at 117-19; Crossen May 13, 1998 Tr. at 813. The FBI,particularly, had traditionally been unwilling to shareinformation or otherwise collaborate with other federal lawenforcement agencies. Id.; Reilly May 19, 1998 Tr. at 123. Thisculture had generated difficulties and tensions between the FBIand the DEA, among others. Ahearn May 11, 1998 Tr. at 117-18;Stutman Apr. 18, 1998 Tr. at 85. Thus, Boeri and Reilly weregenerally reluctant to attempt to work jointly with the FBI.Reilly May 19, 1998 Tr. at 123. This predilection was stronglyreinforced by their fear that if the FBI was told of theirinvestigation, the Bureau would seek to subvert it by informingBulger and Flemmi. Reilly May 19, 1998 Tr. at 125, May 20, 1998Tr. at 115-16.

Shortly before 1984, however, the FBI had been givenjurisdiction concurrent with the DEA's to investigate drugoffenses. Ahearn May 11, 1998 Tr. at 118.In connection with this, the Department of Justice was activelypromoting greater cooperation between the FBI and the DEA.McCurnin Sept. 15, 1998 Tr. at 79-80. Stutman Apr. 15, 1998 Tr.at 85; Boeri May 14, 1998 Tr. at 70-71. Francis Mullen, a formerFBI official, was made the Administrator of the DEA. McCurninSept. 15, 1998 Tr. at 98. John McCurnin who had formerly beenSean McWeeney's deputy in the Organized Crime Section of the FBI,served as Mullen's Executive Assistant and was responsible forcoordinating major matters with the FBI, particularly withMcWeeney. Id. at 79-80. The Organized Crime Drug EnforcementTask Force was established to institutionalize the new policy ofcooperation. Crossen May 13, 1998 Tr. at 83. The United StatesAttorney, William F. Weld, and the FBI and DEA SACs, Greenleafand Stutman, were committed to the effort to enhance cooperation.Stutman Apr. 15, 1998 Tr. at 85-86.

Reilly, however, urged Stutman not to try to involve the FBI inthe investigation of Bulger and Flemmi. Reilly May 19, 1998 Tr.at 123-25; Stutman Apr. 14, 1998 Tr. at 85. Reilly argued thatthe FBI would not share information, its technical expertise ininstalling bugs was not essential, and there was an unacceptablerisk that DEA's efforts would be undermined because the FBI wouldcompromise the investigation to protect its informants. Id.Nevertheless, Stutman saw the investigation of Bulger and Flemmias an opportunity for the collaboration between the DEA and theFBI that was being encouraged. Id.

Stutman discussed the situation with Weld. Weld May 26, 1998Tr. at 23-31. It was Weld's understanding that Bulger and Flemmihad served as sources for the FBI, and had provided some of theinformation necessary to obtain the court orders for electronicsurveillance of 98 Prince Street and 51 North Margin Street.Id. at 21-22. He had also heard that the FBI, particularlyConnolly, was suspected of having told Bulger and Flemmi of thebug at the Lancaster Street Garage. Id. at 22-23, 34-35. Weldunderstood, however, that the FBI's "official line" was to denythat Bulger and Flemmi were informants. Id. at 21.

Stutman and Weld discussed two issues. First, Stutman wanted toknow if the United States Attorney would support the DEA's effortto investigate Bulger and Flemmi, and to utilize electronicsurveillance as a key component of that investigation. Id. at29. Weld said he would "back [DEA] up" and that the investigationcould proceed with his support. Id.

Second, Stutman and Weld discussed whether the FBI should beinvolved in the electronic surveillance that was being planned orwhether the Bureau was so close to the targets that there wouldbe an unacceptable risk that the investigation would becompromised if it was included. Id. at 25. Weld knew that hisprosecutors shared the DEA agents' deep doubts about working withthe FBI in any investigation of Bulger and Flemmi. Id. at 28.Weld and Stutman agreed, however, that Greenleaf should be askedto have the FBI participate in the investigation and,particularly, in the hoped for electronic surveillance. Id. at30.

In about April 1984, Stutman met with Greenleaf and explainedthat the DEA planned to conduct a major investigation, includingelectronic surveillance, of Bulger and Flemmi in which it wantedthe FBI to participate because it was expected that theinvestigation would develop information concerning crimes thatwere within the jurisdiction of the FBI rather than the DEA.Stutman Apr. 14, 1998 Tr. at 10-18, 22, 82; Greenleaf Jan. 8,1998 Tr. at 37-38, 66-69, 195-96. Stutman provided Greenleaf withdetailed information about the investigation to date, including adescription of the information that he felt should be of activeinterest to the FBI. Greenleaf Jan. 8, 1998 Tr. at 125, 195;Stutman Apr. 14, 1998 Tr. at 12. Stutman would have givenGreenleaf any additional informationthat he requested. Stutman Apr. 14, 1998 Tr. at 90. Greenleaf didnot, however, ask for more details or immediately respond toStutman's request.

At about the same time, Weld also met with Greenleaf. Weld May26, 1998 Tr. at 31. Weld too asked Greenleaf if the FBI wouldparticipate in the investigation and any electronic surveillanceof Bulger and Flemmi. Id. at 33. Greenleaf said he would haveto get back to Weld. Id. In view of Greenleaf's usualenthusiasm for major investigations, Weld found his response tobe so "odd" that it strengthened his sense that Bulger and Flemmimay have been FBI informants. Id.

About a week later, Greenleaf told Weld that the FBI would notbe able to participate in the investigation of Bulger and Flemmi.Id. at 37-40. Weld was surprised. Id. at 45. Although theconversation was brief, Weld inferred that Greenleaf hadconsulted FBI Headquarters and determined that the FBI did notwant to participate because of the risk that its involvementwould result in the disclosure of the fact that Bulger had beenan FBI informant and a source for the electronic surveillancethat targeted Angiulo and Zannino. Id. at 40. Greenleaf didnot, however, discourage Weld from pursuing the investigation ofBulger and Flemmi. Weld May 27, 1998 Tr. at 71.

Weld told Stutman of Greenleaf's response. Weld May 26, 1998Tr. at 46. They discussed the possibility that Bulger and Flemmiwere FBI sources. Stutman Apr. 14, 1998 Tr. at 71-72. NeitherWeld nor Stutman, however, ever asked Greenleaf if either or bothwere informants, and Greenleaf did not tell them. Stutman Apr.14, 1998 Tr. at 73; Weld May 26, 1998 Tr. at 133; Greenleaf Jan.8, 1998 Tr. at 195. Rather, Weld and Stutman simply accepted thefact that the FBI would not identify its informants, even totrusted colleagues in the Department of Justice with a legitimateneed to know. Stutman did not ask Greenleaf if Bulger and Flemmiwere FBI informants because Stutman knew that, "it would haverequired [Greenleaf] either lying about it or saying `I can'ttell you.'" Stutman Apr. 14, 1998 Tr. at 73. Similarly, Weldnever asked the FBI to identify an informant because, if he did,he "would have expected [the FBI] to tell [him] to go poundsand." Weld May 26, 1998 Tr. at 133.

When approached by Stutman and Weld, Greenleaf immediatelyrecognized that the investigation of Bulger and Flemmi,particularly any electronic surveillance, would present problemsfor the FBI because Bulger was still open as an informant andboth were providing information. Greenleaf Jan. 8, 1998 Tr. at69-71. Greenleaf consulted several colleagues before deciding howto respond. One was Fitzpatrick, who was the ASAC withresponsibility for relations with the DEA. Fitzpatrick May 16,1998 Tr. at 114-16. In addition, Greenleaf had a meeting whichincluded Ring, in his capacity as chief of the Organized Crimesquad, Rod Kennedy, who had been assigned to work with the DEAand knew prior to the meeting that the DEA was attempting totarget Bulger and Flemmi, and Kennedy's supervisor on the DrugSquad, who was then Morris. Kennedy Apr. 14, 1998 Tr. at 32-39;Morris Apr. 21, 1998 Tr. at 14, Apr. 23, 1998 Tr. at 123.

The meeting focused on the DEA's interest in electronicsurveillance targeting Bulger and Flemmi and whether the FBIshould participate in that effort. Kennedy Apr. 14, 1998 Tr. at32-33, 36-37. Each of the participants knew that Bulger andFlemmi were FBI sources.

Ring did not want the FBI to become involved in theinvestigation for several reasons. Greenleaf Jan. 8, 1998 Tr. at74; Ring June 10, 1998 Tr. at 74; Ring June 10, 1998 Tr. at144-49, 153-55, Sept. 22, 1998 Tr. at 122-28. Ring believed thatany suspicion that Bulger and Flemmi were involved in narcoticstrafficking was not well-founded, in part because no FBIinformant had, to his knowledge, reportedsuch criminal conduct and in part because Connolly asserted thatthey would never deal drugs or even allow them in South Boston.Ring June 10, 1998 Tr. at 153-54, Sept. 22, 1998 Tr. at 123-24;Ex. 13. Ring believed that Bulger and Flemmi were engaged ingambling, loansharking, and, perhaps, murder. Ring Sept. 22, 1998Tr. at 126-27. However, he felt that the DEA's effort was doomedbecause too many investigators knew about it, and Bulger andFlemmi may have already realized that they were being targeted.Ring June 19, 1998 Tr. at 151-53; Ex. 13. Ring argued that if theFBI agreed to participate, it would be blamed if theinvestigation failed and, particularly, if it appeared that itsconfidentiality had been compromised. Greenleaf Jan. 8, 1998 Tr.at 73-74.

Greenleaf decided that the FBI would not join the investigationof Bulger and Flemmi, but would offer technical support and makeKennedy the liaison with the DEA for the purposes of theinvestigation. Ex. 8; Kennedy Apr. 14, 1998 Tr. at 18, 37.Greenleaf also decided to "compartmentalize" the information thatthe FBI had received about the investigation. Kennedy Apr. 14,1998 Tr. 37-38, 46; Greenleaf Jan. 8, 1998 Tr. at 71-72. Inessence, Greenleaf wanted the information the FBI received aboutthe investigation of Bulger and Flemmi to be maintained with "avery high level of integrity and security." Greenleaf Jan. 8,1998 Tr. at 2. As set forth below, this effort failed.

On April 12, 1984, Greenleaf sent FBI Headquarters a teletypeconcerning Bulger and Flemmi that he designated as "Priority." Itsaid:

SAC, DEA, Boston, has advised that his office currently has requested a special enforcement operation proposal of DEAHQ, which is targeted at a large scale cocaine and marijuana trafficking area. This proposal is a joint investigative effort of DEA and the Quincy, Massachusetts Police Department.

Primary targets in this investigative probe are captioned sources [Bulger and Flemmi] whom DEA alleges are individuals who control this narcotic trafficking group.

DEA anticipates extensive investigation to include surveillances and pen registers to develop need[ed] probable cause for electronic microphone of principals involved in this investigation.

FBI, Boston is not a participant in this investigation, however, SAC, Boston has offered technical assistance to DEA when and if desired and liaison has been established between FBI and DEA in this matter.

As FBIHQ is aware, [Flemmi] is presently closed. At this time, Boston does not feel that [Bulger] should be closed due to past, present and future valuable assistance to the FBI. In addition, at present time DEA allegations are unsubstantiated and DEA has furnished no specific information relative to the involvement of [Bulger] in criminal activities. Boston will follow and advise FBIHQ of pertinent developments.

Ex. 12. Notably, the teletype did not include the informationStutman had provided Greenleaf concerning the gambling,loansharking, and other Title 18 offenses that Bulger and Flemmiwere believed to be committing. Nor did it reflect that the FBIhad declined a request to join the investigation.

Although FBI Headquarters was informed of the issue of whetherBulger should have been kept open as an informant, the AssistantAttorney General for the Criminal Division, Stephen Trott, wasnot. As described below, the failure to inform the AssistantAttorney General of the dilemma posed by the information Stutmanprovided Greenleaf, or indeed of Bulger's earlier admission thathe was extorting money from at least one narcotics trafficker,Murray, violated the Attorney General's Guidelines. See Ex. 274(Under Seal), Manual § 137-17(G)(1 & 2) (1-12-81); § 137-16(G)(1& 2) (3-28-84).

While the Assistant Attorney General was being kept in thedark, Connolly soon learned of the information in the April 12,1984 teletype. As Bulger's handler, he may have received a copyfor Bulger's file. In any event, Ring told Connolly that Bulgerand Flemmi might be under investigation by other agencies, butwould give him no further details. Ex. 13. He also warnedConnolly to be prepared to take a polygraph in the event thatthere was ever a claim that the confidentiality of any suchinvestigation had been compromised. Id.

In addition, McWeeney, the Chief of the Organized Crime Sectionat FBI Headquarters, who was involved in the issues presented bythe Wheeler, Halloran, and Callahan murders, received a copy ofGreenleaf's teletype. Ex. 233; Kennedy Apr. 14, 1998 Tr. at27-34, 40-43, 195. Despite Ring's effort to limit Connolly'sknowledge of the DEA's plans, McWeeney told Connolly that the DEAwas trying to obtain a wiretap targeting Bulger and Flemmi.Kennedy Apr. 14, 1998 Tr. at 30-34, 40-43.

It is also likely that Morris told Connolly about theinvestigation targeting Bulger and Flemmi. He had previouslydisclosed Halloran's allegations about them to Connolly. Asdiscussed, in § II.26, infra, he would in 1986 again useConnolly as a conduit to alert Flemmi to a bug aimed atintercepting him. There is no reason to believe that he wouldhave behaved any differently in 1984. Rather, circumstantialevidence suggests that Morris did tell Connolly about theinvestigation. Morris received his first payment of $1000 fromBulger and Flemmi in June 1982, shortly after causing Connolly totell them of Halloran's allegations. Morris Apr. 23, 1998 Tr. at136, 139. He received a second $1000 payment from them, and acase of wine, about two years later, in the spring of 1984.Morris Apr. 29, 1998 Tr. at 65. The timing of this paymentsuggests that it may have been an expression of Bulger andFlemmi's appreciation for Morris' assistance concerning the DEAinvestigation.

It is also likely that Kennedy discussed the DEA investigationwith Connolly. Beginning in 1984, Kennedy on several occasionsdiscussed with Connolly what would happen if Bulger and Flemmiwere ever arrested. Kennedy Apr. 14, 1998 Tr. at 94-99. Kennedyrepeatedly told Connolly that he believed that if Bulger orFlemmi were arrested they would divulge their relationship withConnolly and the FBI. Id. at 97-98. Connolly regularlyresponded that he did not have to worry because they were toosmart to get caught. Id. at 99.

Connolly was relying on more than Flemmi and Bulger's cunningwhen he told Kennedy that he did not have to be concerned aboutthe problems that would be generated if Bulger or Flemmi werearrested. Connolly knew he would protect them, and himself, byfurnishing Bulger and Flemmi any information he could obtain thatmight help them avoid arrest and prosecution.

The court finds that, consistent with this, Connolly toldBulger and Flemmi that the DEA investigation had been initiatedand advised them of the information he obtained concerning itsprogress. Flemmi admits some, but not all of this.

Flemmi acknowledges that the FBI warned him and Bulger thatthey were under investigation. Flemmi Aug. 24, 1998 Tr. at 20.Flemmi claims that in February 1984, he and Bulger "startednoticing things" that made them aware that they were under activeinvestigation by the DEA. Flemmi Aug. 20, 1998 Tr. at 84. Flemmiasserts that in 1984 Ring attended some of their meetings withConnolly and told them the DEA was investigating them. Id. at84-87, Aug. 24, 1998 Tr. at 19. Flemmi also claims that inDecember 1984, Ring called to tell him that a wiretap was aboutto be placed on George Kaufman's telephone and on his own. Id.at 86-87. Ring denies that he told Flemmi about the prospectiveDEAwiretaps. Ring Sept. 22, 1998 Tr. at 28-29.

This is a matter on which the court finds that Flemmi'stestimony is in part accurate and in part false. Morespecifically, the credible direct and circumstantial evidenceproves that Bulger and Flemmi were told of the investigationgenerally and of the electronic surveillance particularly. Itwas, however, Connolly not Ring who gave them this information.

On February 7, 1984, as part of his early investigation, Reillyasked the National Crime Information Center ("NCIC"), which isrun by the FBI in Washington, D.C., for a copy of Bulger'scriminal record. Ex. 137; Ring June 16, 1998 Tr. at 101-03. Atthat time, if the subject of such a request was an FBI informant,the Informant Section at FBI Headquarters would be advised of theinquiry, and send notification of it to the informant's handlerand his supervisor for inclusion in the informant's file. RingJune 16, 1998 Tr. at 101-05. This practice was followed withregard to Reilly's inquiry concerning Bulger. Ex. 137; May 15,1998 Tr. at 43. Thus, in February 1984, Connolly learned that theDEA was focusing on Bulger. Based in part on Connolly's previousand future practice, the court infers that he told Bulger andFlemmi about the DEA investigation. It is, therefore, notsurprising that in February 1984, they "started noticing things."Flemmi Aug. 20, 1998 Tr. at 84.

In addition, recognizing they were under surveillance, Bulgerand Flemmi ceased meeting Connolly at Bulger's apartment inQuincy. Flemmi Aug. 24, 1998 Tr. at 84-85. Instead, they beganmeeting at Connolly's home in South Boston and later at theapartment of his colleague, John Newton. Id.; Newton May 22,1998 Tr. at 126-27, June 2, 1998 Tr. at 77, 80.

In 1984, Flemmi maintained regular contact with Connolly andcontinued to provide valuable information concerning the LCN. Forexample, he reported that: Raymond J. Patriarca would soon benamed to succeed his deceased father as Boss; Joe Russo, who wasa fugitive as a result of the Barboza murder was living inMontreal, but being urged by Zannino to return to Boston, wherethe LCN was being depleted; and Frank Salemme had a potentiallyviolent dispute with Joe "Black" LaMattina, a member or associateof the Patriarca Family. Exs. 19, 237 (209 dated 7/16/84).

Ring did meet with Connolly, Bulger, and Flemmi several timesin 1984. Exs. 13, 178. Beginning at some time prior to April1984, Bulger and Flemmi reported that they were aware that theywere under investigation and surveillance. Exs. 13, 14. They alsoindicated that they had observed intensified law enforcementattention to them in the summer of 1984. Ex. 14.

Flemmi's reaction to the joint DEA, Massachusetts State Police,and Quincy Police Department investigation is significant. Flemmidid not complain to Connolly or Ring that his agreement with theFBI gave him immunity from being investigated by other agenciesor from being prosecuted if that investigation were successful.Flemmi Aug. 24, 1998 Tr. at 24-25. This was not Flemmi'sunderstanding. Rather, Flemmi understood that it would be legallypermissible for him to be prosecuted as a result of theinvestigation that was being conducted in 1984 by the DEA, theMassachusetts State Police, and the Quincy Police Department.Id. at 24-26, Aug. 25, 1998 Tr. at 246.

Flemmi believed that the FBI was obligated to protect him byproviding him information about investigations that he could useto frustrate them, one way or another. Flemmi Aug. 24, 1998 Tr.at 22-26, Aug. 25, 1998 Tr. at 247. Flemmi now believes that in1984 and 1985, the FBI provided him with the protection that hehad been promised by warning him of the pending investigation andof the electronic surveillance that was part of it. Flemmi Aug.24, 1998 Tr. at 20, 22-24. Accordingto Flemmi, the warnings that he received concerning the 1984-85investigation of him were part of both the FBI's promise to himand of its fulfillment. For example, he testified:

A. [Ring] advised us that there was a telephone tap on my phone. That was in a sense telling me that we were being protected. We were aware of the investigation that was ongoing.

Q. And in your mind was that the FBI's obligation to you?

A. Yes, absolutely. They're notifying me that there's an investigation going on. To me, it says I'm getting protected. I can't think of any other way.

Id. at 23-24.

In any event, after Greenleaf declined to have the FBI become aformal participant in the joint investigation in April 1984, theFBI provided some advice and assistance to the DEA. Fitzpatrickdiscussed the DEA investigation with his counterpart, DEA ASACPaul Brown. Fitzpatrick Apr. 14, 1998 Tr. at 117. Brownfrequently told Fitzpatrick that he knew that Bulger and Flemmiwere FBI informants, and claimed that Greenleaf had told Stutmanof their status. Id. at 124-25. Fitzpatrick regarded Bulger andFlemmi's status as FBI informants as "the worst kept secret inthe world." Id. at 117. Fitzpatrick told an official at FBIHeadquarters that McCurnin, the former FBI official who was theExecutive Assistant to the Administrator of the DEA, knew thatBulger was an FBI informant. Ex. 233; McCurnin Sept. 15, 1998 Tr.at 85, 89. Nevertheless, Fitzpatrick joined Greenleaf in urgingthat Bulger not be closed as an informant. Ex. 233.

Kennedy, who was the FBI's liaison agent to the DEA in Boston,also discussed the ongoing DEA investigation with hiscounterparts, Boeri and Reilly. They too said they believedBulger and Flemmi were FBI informants. Kennedy May 14, 1998 Tr.at 143-44. Kennedy, however, did not confirm this. Id. at 160.

The DEA agents asked Kennedy for any information which the FBIhad that would support the application for electronicsurveillance of Bulger and Flemmi that was being prepared. Id.at 102-04, 119, 208. Kennedy told them that there were two FBIsources who said that Bulger and Flemmi were extorting money fromdrug traffickers. Id. at 208; Ex. 45. Both sources, he said,reported that Hobart Willis and Joseph Murray, who controlled therecently raided South Boston warehouse in which fifteen tons ofmarijuana were seized, were associated with Bulger. Ex. 45.Kennedy also advised that one source stated that Willis andMurray were not required to pay Bulger, but that "every other`bookie' and drug dealer in the Boston area [was] paying`tribute' to [him]." Id. As described earlier, however, Kennedydid not tell the DEA agents that Bulger himself had told Connollythat he had received $60-90,000 in drug money from Murray. Id.;Kennedy Apr. 14, 1998 Tr. at 62-63, 79, 115, 121-29.

In November 1984, several FBI agents with specialized,technical expertise in installing microphones came to Boston toadvise the DEA on installing a bug in Bulger's automobile, andcondominium, each of which had sophisticated alarms. Ex. 146;Reilly May 20, 1998 Tr. at 10-12, 35-36. The FBI experts,however, reported that it was not possible to bug either Bulger'svehicle or residence. Id. This reinforced Reilly's view thatthe FBI was determined to protect its informants. Reilly May 20,1998 Tr. at 37. Although they had no specialized training, Reillyand Boeri later installed listening devices in Bulger's home andautomobile. Id. at 12, 37.

Prior to October 17, 1984, Greenleaf provided Stutman withinformation that the FBI was receiving from Bulger and Flemmiindicating their awareness of the investigation targeting them.Exs. 13, 146; Ring June 10, 1998 Tr. at 129-36; Reilly May 20,1998 Tr. at 35-36, 71; Boeri May 15, 1998 Tr. at 50-51. Greenleafdid not,however, tell Stutman that Bulger and Flemmi were the sources ofthe information. Greenleaf Jan. 8, 1998 Tr. at 201-09.

By at least mid-October 1984, the DEA and United StatesAttorney's Office realized that they faced a difficult dilemma.Boeri May 14, 1998 Tr. at 134-35. They had invested almost a yearin conducting an investigation intended to lead to electronicsurveillance targeting Bulger and Flemmi. It appeared, however,that the potential for their investigation to succeed indeveloping prosecutable cases had been seriously diminishedbecause Bulger and Flemmi were well aware that they had beentargeted. Id.; Ex. 18. It was decided to try to resolve thisdilemma by continuing the investigation of Bulger and Flemmi,while attempting to give them the impression that it had beenaborted. Reilly May 20, 1998 Tr. at 113-14.

More specifically, the DEA's effort to have the investigationtargeting Bulger and Flemmi designated as an Organized Crime DrugEnforcement Task Force case succeeded on November 7, 1984. Ex.140; Reilly May 19, 1998 Tr. at 143-45. The Organized Crime DrugEnforcement Task Force designation constituted recognition thatthe investigation of Bulger and Flemmi was a major matter andprovided the "big money" necessary to continue it. Id. Bulgerand Flemmi were the sole named targets of the investigation. Exs.140, 146. The investigation would not have been authorized orsustained in the hope of merely developing a case against anyoneelse, including George Kaufman. The DEA believed that "[t]hesuccess of the . . . investigation relie[d] upon the successfulinstallation of a `car bug' in the BULGER vehicle, and theinstallation of a `room bug' in the BULGER residence." Ex. 146. Awiretap on Kaufman's telephone was being contemplated only as ameans of obtaining the probable cause necessary to obtainwarrants to bug Bulger's car and home. Id. The DEA would nothave sought authority to tap Kaufman's telephone if Bulger andFlemmi were not the targets of that effort.

At the same time, it was decided that in view of theinformation about Bulger and Flemmi's awareness of theinvestigation that Stutman had received from the FBI, it wasimportant to reduce the number of people who knew about theinvestigation in an effort to minimize the risk of leaks and,particularly, to try to give Bulger and Flemmi the impressionthat it had been ended. Reilly May 20, 1998 Tr. at 113-14; BoeriMay 14, 1998 Tr. at 40-41, 90-91. Accordingly, it was decidedthat the Massachusetts State Police would be cut out of theinvestigation on the pretext that the effort was being abandoned.Id.

As a result, the DEA lost the partner in the jointinvestigation that had both the authority and experience toinvestigate gambling and loansharking. Boeri May 18, 1998 Tr. at40. As described earlier, Crossen believed that any effort toobtain a warrant to conduct such electronic surveillance wouldrequire the participation of an agency with the authority toinvestigate gambling, loansharking, and other non-narcoticsoffenses that there was probable cause to believe would bediscussed during any electronic surveillance of Bulger andFlemmi. Crossen May 13, 1998 Tr. at 90-91. Crossen also believedthat the DEA lacked such authority. Thus, at some point betweenOctober and December 1984, the FBI was again asked to participatein the investigation and the proposed electronic surveillance.Boeri May 14, 1998 Tr. at 44-45, 61-65, 72, May 18, 1998 Tr. at40; Reilly May 19, 1998 Tr. at 118-19.

This time Greenleaf agreed. He assigned the matter to theOrganized Crime squad and directed Ring to provide two agentsfrom that squad to work with the DEA on the investigation,including the electronic surveillance. Ring June 10, 1998 Tr. at117-18, 130.

Ring was not pleased with the arrangement because he continuedto be concerned that the FBI would be blamed if, ashe expected, the investigation did not succeed. Carter Aug. 17,1998 Tr. at 98. Ring decided to discharge his newresponsibilities in a way that would minimize the potential forfair criticism of the FBI if and when the investigation failed.Ring assigned two agents who were new to Boston and the OrganizedCrime squad, Richard Carter and Brian Rossi, to work with the DEAon the electronic surveillance targeting Bulger and Flemmi. RingJune 10, 1998 Tr. at 118, Sept. 22, 1998 Tr. at 106-08, 112;Carter Aug. 17, 1998 Tr. at 47, 97. Neither agent knew thatBulger or Flemmi was an FBI informant. Carter Aug. 17, 1997 Tr.at 97, 101-12. Thus, there was no risk that either would divulgethat Bulger and Flemmi were FBI sources.

Ring told Carter and Rossi to stay away from the FBI while theywere working with the DEA. Id. at 97. Ring also directed themnot to tell any member of the FBI what evidence or informationwas being gathered in the joint investigation. Ring June 10, 1998Tr. at 117-19, June 19, 1998 Tr. at 154. As these instructionsdemonstrate, Ring, and the FBI that he represented, had nointention of using evidence obtained by the electronicsurveillance in any investigation or prosecution of Flemmi,Bulger, Kaufman, or anyone else for any Title 18 offense,including gambling, loansharking, or extortion. Carter and Rossiobeyed Ring's order and did not provide him with any of theinformation they acquired while participating, on behalf of theFBI, in the investigation of Bulger and Flemmi. Ring June 10,1998 Tr. at 119, June 19, 1998 Tr. at 153-54.

Although representatives of the United States Attorney'sOffice, the DEA, and the FBI were all involved in the decision tohave the FBI join the investigation of Bulger and Flemmi, nobodyconsidered the implications of the Bureau's involvement for thenecessity portion of the application for a warrant authorizingelectronic surveillance targeting Bulger and Flemmi that wouldsoon be filed. Crossen May 12, 1998 Tr. at 29-35; Greenleaf Jan.8, 1998 Tr. at 227-28; Ring June 22, 1998 Tr. at 81-83; Boeri May14, 1998 Tr. at 36-37; Reilly May 20, 1998 Tr. at 118. Crossenand Boeri were primarily responsible for preparing theapplication and the affidavit on which it relied. In December1984, however, Crossen had no prior experience with federalapplications and Boeri had never served as the case agent oraffiant in an investigation involving electronic surveillance.Crossen May 12, 1998 Tr. at 21; Boeri May 14, 1998 Tr. at 29-30.Reilly and Boeri did consult O'Sullivan to get advice concerningthe procedures to be followed to obtain a warrant for electronicsurveillance. Ex. 254. Nevertheless, central requirements ofTitle III were utterly overlooked or ignored.

More specifically, Title III requires, among other things, thateach application for an order authorizing electronic surveillanceestablish that: there is probable cause to believe that aparticular offense is being committed; there is probable cause tobelieve that the proposed wiretap or bug will intercept evidenceof that crime; and electronic surveillance, which is anespecially intrusive investigative technique, is necessary. See18 U.S.C. § 2518(1)(b),(c) and (3)(a)(b) and (c). With regard tonecessity, the statute states that the application must include:

(c) a full and complete statement as to whether or not other investigative procedures have been tried and failed or why they reasonably appear to be unlikely to succeed if tried or to be too dangerous.

18 U.S.C. § 2518(1)(c) (1994).

As the Court of Appeals for the First Circuit explained inUnited States v. Mastroianni, a decision rendered on October30, 1984, § 2518(1)(c) requires that the affiant in anapplication for an order authorizing electronic surveillanceobtain relevant information from "all agencies involved in theinvestigation . . ." before representing that electronicsurveillance is necessary. United States v. Mastroianni,749 F.2d 900, 910 (1st Cir. 1984). As discussed in theConclusions of Law, § III.2.E, infra, the Mastroiannidecision was not novel. See, e.g. Franks, 438 U.S. at 164 n. 6,98 S.Ct. 2674; United States v. Dorfman, 542 F. Supp. 345, 366n. 18 (N.D.Ill. 1982), aff'd sub nom. United States v.Williams, 737 F.2d 594 (7th Cir. 1984); United States v.Tufaro, 593 F. Supp. 476, 485-86 (S.D.N.Y. 1983). Moreover, as apractical matter, in 1984, participants in joint investigationsroutinely shared relevant information with the DEA without evenbeing asked. Stutman Apr. 15, 1998 Tr. at 146-47, 164.

In this case, however, Crossen, who had a practice of readingFirst Circuit decisions in criminal cases and should have readthe Mastroianni decision, did not direct the DEA to consult theFBI concerning the necessity for electronic surveillancetargeting Bulger and Flemmi. Crossen May 12, 1998 Tr. at 29-35,May 13, 1998 Tr. at 87-89; Reilly May 20, 1998 Tr. at 6, 116-17;Boeri May 14, 1998 Tr. at 133-34. He essentially relied on Boeriand Reilly to collect the legally required information. CrossenMay 13, 1998 Tr. at 85-88.

The DEA, however, relied on the United States Attorney's Officefor direction regarding legal requirements. Reilly May 20, 1998Tr. at 118-19; Boeri May 14, 1998 Tr. at 37. Neither Reilly norBoeri was aware of the Mastroianni decision or of therequirement that all participating agencies be consultedconcerning the necessity for electronic surveillance. Reilly May20, 1998 Tr. at 118-19; Boeri May 14, 1998 Tr. at 36-37. Nor wasStutman. Stutman Apr. 15, 1998 Tr. at 167. The DEA agents askedthat FBI indices be checked to determine whether there had beenany prior applications for electronic surveillance targetingBulger or Flemmi, as required by 18 U.S.C. § 2518(1)(e). ReillyMay 19, 1998 Tr. at 134-35. However, no inquiry was addressed tothe FBI regarding the requirements of § 2518(1)(c) concerning thenecessity for electronic surveillance. Boeri May 14, 1998 Tr. at118; Reilly May 20, 1998 Tr. at 5-6. Boeri did not believe thatit was required that he do so. Boeri May 14, 1998 Tr. at 95-96.

Similarly, the FBI did not recognize or discharge itsobligation to furnish for inclusion in the application thesignificant information it had concerning the necessity ofelectronic surveillance targeting Bulger and Flemmi. Greenleafhad neither training nor experience regarding the requirements ofTitle III. Greenleaf Jan. 8, 1998 Tr. at 227. He was generallyaware that an applicant was obligated to make a full and completestatement concerning why conventional investigatory techniqueswere insufficient, but did not think about this in the context ofthe investigation that the FBI had joined. Id. at 228-29.

Ring also gave no consideration to this issue. Ring June 22,1998 Tr. at 81-82. Consistent with the effort to compartmentalizethe information that Bulger and Flemmi were being targeted forelectronic surveillance, Ring did not discuss with the FBI'sPrincipal Legal Adviser or anyone else the legal requirements ofTitle III or the implications for the proposed electronicsurveillance of Bulger and Flemmi's relationship with the FBI.Id. at 81-83. Thus, no consideration was given by the FBI tothe requirements of § 2518(1)(c) or the ruling in Mastroianni.

Determined not to acquire any additional information about thejoint investigation, Ring also did not review the application forthe order authorizing electronic surveillance of Bulger andFlemmi, or the Boeri affidavit on which it relied. Ring June 19,1998 Tr. at 154-55. Nor did Greenleaf. Greenleaf Jan. 8, 1998 Tr.at 229-30.

In essence, with regard to the 1984-1985 electronicsurveillance, the DEA and the FBI were necessary, but reluctantpartners. The FBI was determined not to violate the sacredpromise of confidentiality that it made to all of its informants,including Bulger and Flemmi. The prosecutors and members of theDEA believedthat Bulger and Flemmi were FBI sources, but accepted the factthat the Bureau would not divulge or discuss their status. In thecircumstances, the prosecutors and DEA agents sought to minimizethe information about the investigation that was disclosed to theFBI in order to limit the risk that the confidentiality of theirinvestigation would be compromised. Ring sought to insulateeveryone at the FBI except Rossi and Carter from theinvestigation in order to avoid blame if the investigationfailed. In the process the government recklessly disregarded itslegal obligation to include in its application the legallyrequired "full and complete statement" concerning the necessityfor electronic surveillance.

The FBI also ignored the essential point of the AttorneyGeneral's Guidelines, which required consultation with theAssistant Attorney General for the Criminal Division when theBureau learned that an informant had engaged in criminalactivity, but wished to continue to utilize the informant ratherthan share the pertinent information with another law enforcementagency. See Ex. 274 (Under Seal), Manual § 137-17(G)(1 & 2)(1-12-81); § 137-16(G)(1 & 2) (3-28-84). This violation of theGuidelines contributed to a violation of Title III as well.

The Supreme Court has held that Title III, "plainly calls forthe prior, informed judgment" of prosecutors, rather thaninvestigators, before an application for electronic surveillancemay be filed. Giordano, 416 U.S. at 515, 94 S.Ct. 1820. Theexercise of such judgment by, in this case the Assistant AttorneyGeneral for the Criminal Division, "is interposed as a criticalprecondition to any judicial order." Id. at 516, 94 S.Ct. 1820.

In the instant case, if the facts necessary for an informedjudgment to have been made had been disclosed by the FBI, or ifthe well-known issue of Bulger and Flemmi's status as sources hadeven been discussed with the FBI, no application for authority toconduct electronic surveillance targeting them would have beenfiled in 1984. If, however, an application with the required"full and complete statement" concerning the necessity forelectronic surveillance had been submitted, the request for awarrant would have been denied.

Mere discussion with the FBI of the implications of Bulger andFlemmi's status as sources for the investigation that the DEA wasleading and for the proposed electronic surveillance would, in1984, have probably caused the termination of the investigationand, in any event, would have prevented any application forelectronic surveillance from being made. More specifically, theDEA agents and the prosecutor primarily responsible for theinvestigation each now acknowledges that if he had been toldofficially that Bulger and Flemmi were FBI informants, a highlevel decision, involving officials of the Department of Justice,would have had to be made concerning whether to continue thatinvestigation. Boeri May 14, 1998 Tr. at 96-97; Crossen May 13,1998 Tr. at 11-16. They also recognize that if Bulger and Flemmiwere valuable sources for the FBI, there was a good chance thatthey would not have been allowed to proceed with theirinvestigation. Crossen May 13, 1998 Tr. at 11-16.

Their understanding is accurate. Indeed, if Stutman hadreceived confirmation that Bulger and Flemmi were FBI informantsand were able to talk to Greenleaf about it, he would haveabandoned the investigation. Stutman Apr. 15, 1998 Tr. at 169-71.Stutman would have asked Greenleaf whether the FBI was aware ofthe criminal activity in which Bulger and Flemmi were engaged;whether Bulger and Flemmi were involved in any of the activityunder investigation in connection with their relationship withthe FBI; whether the FBI was going to compromise any continuinginvestigation; and, most importantly, whether the DEA'sinvestigation would interfere with the FBI's efforts. Id.Candid responses would have been "yes" to each of thesequestions. Moreover,the FBI would have undoubtedly emphasized the great value ofBulger and Flemmi to the Bureau in its war against the LCN. Inthe circumstances, Stutman would have deferred to the FBI ratherthan invest a great deal of time and money in investigatingBulger and Flemmi. Id. This decision would have been supported,if not dictated, by DEA Headquarters, where McCurnin would havehad the responsibility to work out any conflict with his formerboss, McWeeney. McCurnin Sept. 15, 1998 Tr. at 79-80.

If, however, Crossen were somehow permitted to submit anapplication for electronic surveillance targeting Bulger andFlemmi, he would have insisted on sharing with the judge theinformation that he had received from the FBI, including theirstatus as informants, any information suggesting that they mayhave been authorized to commit any of the possible crimesreferenced in the application, and the fact that the governmentdid not intend to use any intercepted evidence of possible Title18 offenses in an investigation or prosecution of Bulger orFlemmi. Id.

Similarly, Weld would not have knowingly permitted a false ormisleading affidavit to be filed in support of an application forelectronic surveillance. Weld May 27, 1998 Tr. at 108-09. Norwould Assistant Attorney General Trott, who had to authorize theapplication. Rather, Trott would have required that the court beprovided with accurate and complete information in the possessionof any agency involved in the joint investigation, including theFBI. Indeed, Trott, now a judge of the Ninth Circuit Court ofAppeals, recently participated in a decision which recognized anddescribed this responsibility. See United States v. Aviles,170 F.3d 863, 867 (9th Cir. 1999), petition for cert. filed (U.S.June 9, 1999) (No. 9705).

It is clear to the court that if the matter had been discussed,the FBI would have ardently argued that Bulger and Flemmi wereinvaluable informants, whose status had to be maintained asconfidential even if it meant abandoning the investigation or theproposed electronic surveillance. Its conduct in the instant caseindicates that the Department of Justice would have given greatweight to the importance of honoring the FBI's promise ofconfidentiality to Bulger and Flemmi. For example, as discussedin § II.33, infra, in 1997, the Acting Deputy Attorney Generalaccepted a serious risk that this court would hold him in civilcontempt rather than confirm that Angelo "Sonny" Mercurio, whohad been already prosecuted and imprisoned, was an FBI informant.The Department of Justice would have been even more stronglysupportive of Bulger and Flemmi in 1984, when disclosure thatthey were FBI sources could have complicated the pendingprosecution of Angiulo and his colleagues. See Ex. 176.

The FBI's determination not to confirm that Bulger and Flemmiwere informants or to discuss the implications of their statusfor the pending investigation, and the acceptance by the DEA andthe United States Attorney's Office of the FBI's position, causedthe applications for electronic surveillance now at issue to besubmitted with reckless disregard for their accuracy andcompleteness and, as a result, with materially misleadingomissions and misstatements. More specifically, at 12:30 p.m. onDecember 24, 1984 — the verge of Christmas Eve — Crossensubmitted to United States District Judge W. Arthur Garrity, Jr.an Application, incorporating a 104-page affidavit of Boeri, anda proposed Order authorizing electronic surveillance. Exs. 133,138, 139. The Order was, without modification, promptly issued.Ex. 139.

The government now claims that there was not a joint DEA-FBIinvestigation prior to the issuance of the December 24, 1984Order by Judge Garrity. See Government's Post-Hearing Brief inOpposition to Defendants' Motions to Dismiss Indictment and toSuppress Electronic Surveillance Evidence (Jan. 29, 1999) ("Gov.Post-Hearing Brief") at 319-23.As described earlier, this contention is, as a matter of a fact,incorrect. It is also clearly inconsistent with therepresentations that the government made to three United StatesDistrict Judges in 1984 and 1985.

The application for electronic surveillance submitted to JudgeGarrity on December 24, 1984 cited Bulger and Flemmi as the firsttwo named targets. Ex. 138, ¶ 3. This was compatible with theirstatus as the "top" — indeed indispensable — targets of theinvestigation. Crossen May 11, 1998 Tr. at 142-43; Exs. 140, 146.Relying on the Boeri affidavit, the Application asserted thatthere was probable cause to believe that Bulger and Flemmi wereengaged in conduct constituting drug offenses in violation ofvarious provisions of Title 21 of the United States Code and inactivities constituting an illegal gambling business in violationof several provisions of Title 18 of the United States Code. Ex.138, at 3-4 (¶ 5(a) and (c)). The Application also asserted thatthere was probable cause to believe the wiretap of GeorgeKaufman's telephone being proposed would cause the interceptionof "admissible evidence" of both Title 18 and 21 offenses. Id.Thus, the Application requested authority for the DEA and the FBIto wiretap Kaufman's telephone. Id. at 8.

With regard to the FBI, the Boeri's affidavit explained that:

Because of the information supporting a finding of probable cause regarding Title 18 offenses as specified herein and in the accompanying Application of Assistant U.S. Attorney Gary C. Crossen, Special Agents of the Federal Bureau of Investigation have been assigned to work in conjunction with other agents previously working on this investigation.38 Authorization is therefore also sought for the assigned FBI agents to participate in the authorized interceptions.

Ex. 133 at 104 (emphasis added). See also Reilly May 20, 1998Tr. at 117. Reaffirming the original representation that FBIagents had been assigned to work on the joint investigationbefore the initial Application was submitted, the February 1,1985 request for a renewal and expansion of the first Order,which was presented to Judge Joseph Tauro, stated that:

This investigation remains a joint investigation participated in by Special Agents of the Drug Enforcement Administration, . . . Special Agents of the Federal Bureau of Investigation . . ., and detectives of the Quincy Police Department . . . and troopers of the Massachusetts State Police and coordinated by the United States Department of Justice, New England Narcotics Task Force.

Ex. 135 at 2 (emphasis added). The March 1, 1985 request foranother extension, which was submitted to Judge A. David Mazzone,reiterated that, "this investigation remains a jointinvestigation participated in by" the DEA, the FBI, and theQuincy Police Department, and coordinated by the Task Force. Ex.136 at 2 (emphasis added). The Massachusetts State Police, werefor the first time, not included.

Consistent with the representation that the FBI was involved inthe investigation, the December 24, 1984 Boeri affidavit insupport of the Application included information that came fromthe FBI and, in some instances, was attributed to FBI sources.United States v. Salemme, 978 F. Supp. 343, 348 (D.Mass. 1997);May 15, 1998 Tr. at 6-7; Exs. 45, 133 at 47 (¶ 75), 79 (¶ 108).

As described earlier, the DEA considered only Bulger and Flemmito be the "subjects of this investigation." Ex. 146. The DEAagents felt that bugging Bulger's automobile and residence wouldbeessential if the investigation were to succeed. Id. TheDecember 24, 1984 Application, however, sought only authority towiretap Kaufman's telephone. Ex. 138. As described earlier, theevidence convinces the court that no application for authority towiretap Kaufman's telephone would have been made except as partof the DEA's effort to develop cases against Bulger and Flemmi.As required by law, however, the application also identifiedother individuals who were expected to be overheard engaging incriminal conversation with Kaufman. See 18 U.S.C. § 2518(1)(b)(1994); Ferrara, 771 F. Supp. at 1300.

The December 24, 1984 Boeri affidavit in support of theApplication rambles over 104 pages. Ex. 133. It was not organizedto identify clearly the probable cause to believe that any namedtarget was involved in specific criminal activity or,particularly, that he would be overhead discussing any suchactivity over Kaufman's telephone. Id.

The failure of the Boeri affidavit to summarize the particular"probable cause" relating to each named target obscured keyfacts. Most importantly, the form of the affidavit made it verydifficult, if not impossible without extraordinary effort, todiscern that there was no evidence to establish probable causethat Bulger would be intercepted speaking to Kaufman aboutanything, and only slight evidence to suggest that Flemmi mightdiscuss any narcotics offense on Kaufman's telephone.

More specifically, the Boeri affidavit includes over thirtypages of charts and other information derived from pen registersindicating the telephone numbers dialed by the eight individualspurportedly expected to be overheard on the Kaufman telephone.Ex. 133 at 69-100. At the conclusion of this detailed portion ofhis affidavit, Boeri stated, among other things, that, "Kaufmanhas . . . telephonic contact . . . with . . . Bulger." Id. at100 (¶ 127). Boeri acknowledged in his testimony, however, thatthe mass of information generated from many months of penregisters on various telephones used by Bulger does not include asingle call from Bulger to Kaufman's telephone, or from Kaufmanto Bulger. Id. at 69-100; Boeri May 18, 1998 Tr. at 14-16.Thus, contrary to the contentions in Crossen's Application andBoeri's affidavit, there was no probable cause to believe thatBulger would be intercepted discussing anything on Kaufman'stelephone. Ex. 133 at 3 and 4 (¶ 7(b) and (d)); 138 at 3-5 (¶5(b) and (d)). The statement that such probable cause existed wasclearly made with at least reckless disregard for its truth and,the court infers, knowledge that it was not true.

The pen registers did indicate that Flemmi and Kaufman spokeoften by telephone. Ex. 133 at 69-100. Boeri's 104-page,136-paragraph affidavit, however, contained only severalparagraphs that included, among other things, any informantinformation that Flemmi was involved with drug dealers. Id. at7-8 (¶ 12), 8 (¶ 13), 39 (¶ 62(k),(l),(m)), 40-41 (¶62(v),(x)), 44 (¶ 68(d)).39 The essence of this informationwas that Flemmi was, with Bulger, extorting money from FrankLepere and other, unnamed drug dealers, who had to pay Bulger andFlemmi if they wished to stay in business. Id. Extortion is aTitle 18 offense. See 18 U.S.C. § 1951 (1994).

In contrast to the skimpy information associating Flemmi withconduct criminalized by Title 21 of the United States Code, theBoeri affidavit contained information that was both moreextensive and detailed concerning Flemmi's and Bulger's possibleinvolvement in illegal gambling and loansharking, which are Title18 offenses. See, e.g., Ex. 133 at 11-20 (¶¶ 21 and 22), 28 (¶46(a)), 36-41 (¶ 62), 41-43 (¶ 64), 44-45 (¶ 68), 46-47 (¶¶ 72,73). Much of thisinformation was derived from the 1980 electronic surveillance ofthe Lancaster Street Garage. Id. at 11-19 (¶ 21). MassachusettsState Trooper John Naimovitch, who had tipped Flemmi to theLancaster Street Garage bug, was the source of some of theadditional Title 18-related information on which Boeri relied.Id. at 15-16 (¶ 21(B)), 17 (¶ 21(D)), 44-45 (¶ 68), 46 (¶ 72).

The Boeri affidavit contained ample evidence to establish thatFlemmi and Kaufman spoke often by telephone, but providedvirtually no basis to believe that they discussed any narcoticsoffenses. The few paragraphs of the Boeri affidavit which thegovernment contends establish probable cause to believe thatBulger and Flemmi were committing narcotics offenses contain noreference to Kaufman. See Gov. Post-Hearing Brief at 347-49.Moreover, the informant characterized as CS-4, who wasrepresented to be "personally acquainted" with Kaufman,characterized him as being "close to Flemmi in the illegal gamingand loansharking business," a "front man" for Bulger and Flemmiin the "hot car" business, and a person they use for their moredifficult sports betting. Ex. 133, § 68(h),(i),(k). CS-4 did notclaim Kaufman was involved in narcotics activity with Flemmi,Bulger, or anyone else.40

Read closely, the 104-page Boeri affidavit contains only tworeferences to Kaufman's possible involvement with narcotics. Morespecifically, Kaufman's telephone number was found in an addressbook seized from a fugitive from drug charges, Salvatore Caruana.Ex. 133, ¶ 41 (at 27). Although pen registers were utilized formore than eight months, however, the Boeri affidavit does notindicate that Caruana ever called Kaufman or was expected to doso. Ex. 133. The pen registers did indicate that Joseph Murray'stelephone was called six times from Kaufman's home. Id. at 108.The affidavit did not claim, however, that a wiretap was beingsought because there was probable cause to believe Kaufman andMurray would be intercepted discussing any drug offense. Id.Nor did the court make such a finding. Ex. 139.

The Application and Boeri affidavit stated that AssistantAttorney General Trott had authorized the Application. Ex. 138 at1 (¶ 2). In addition, it was expressly represented that therequested electronic surveillance was necessary to obtainadmissible evidence of the Title 18 and Title 21 offenses thatCrossen and Boeri claimed there was probable cause to believeBulger and Flemmi would be discussing on Kaufman's telephone. Ex.133 at 4 (¶ 8), 101 (¶¶ 129-133); Ex. 138 at 5.

As indicated earlier, Judge Garrity issued the proposed Orderauthorizing the wiretap of Kaufman's telephone shortly afterreceiving the Application, and the lengthy, convoluted Boeriaffidavit, on the afternoon before Christmas. Viewing thegovernment's submission in a common sense manner, as a reasonablejudge, he would have received the following messages. TheAssistant Attorney General had made an informed and considereddecision to authorize the Application. The Application had as itsprimary targets Bulger and Flemmi, two notorious, reputedorganized crime figures. The FBI was genuinely involved in theinvestigation and was interested in developing a prosecutablecase against Bulger, Flemmi, Kaufman, and others for engaging inillegal gambling and other Title 18 offenses. The DEA was hopefulof generating a prosecutable narcotics case against them as well.Electronic surveillance was necessary to obtain admissibleevidence to be used to prosecute Bulger, Flemmi, Kaufman, andothers for illegal gambling and other Title 18 offenses. Althoughthere did not appear to be adequate evidence to establishprobable cause to believe that conversations concerningany Title 21 narcotics offense would be intercepted by a wiretapof Kaufman's telephone, it was not necessary to rely on the Title21 information because there was sufficient evidence thatconversation concerning conduct that was criminal under Title 18of the United States Code would be overheard.

The submission of the Application and Boeri affidavitcommunicating these messages was made with reckless disregard forthe truth because they conveyed a message that was inconsistentwith the facts as Boeri and Crossen understood them. Boeri andCrossen had obvious reasons to doubt the veracity of the messagethat they were communicating to the judge and, indeed, did notbelieve that it was true. More specifically, neither Boeri norCrossen expected that the FBI would use any evidence generated bythe proposed electronic surveillance to try to develop aprosecutable Title 18 case against Bulger or Flemmi. To thecontrary, they believed that Bulger and Flemmi were valuedinformants that the FBI would seek to protect rather thanprosecute. Similarly, Boeri and Crossen did not expect the FBI totry to develop a prosecutable Title 18 case against Kaufman, whohad been targeted by the DEA for electronic surveillance becausehe was a close colleague of Flemmi and Bulger.

If Ring had reviewed Boeri's affidavit on behalf of the FBI, hewould have recognized that it sent a false and misleadingmessage. More particularly, he would have recognized that itfalsely indicated that the FBI wished to investigate Bulger,Flemmi, Kaufman, and others in order to develop a prosecutablecase concerning illegal gambling and other Title 18 offenses, andthat the requested electronic surveillance was necessary to thesuccess of that investigation. He also would have seenrepresentations that Bulger and Flemmi were engaged in drugtrafficking that he seriously doubted were true and that Connollybelieved were not true. However, motivated by a desire tominimize the risk that the FBI could be blamed for compromisingthe investigation if it failed, Ring, on behalf of the FBI,completely and recklessly, disregarded the question of whetherfalse and misleading representations were being made in the Boeriaffidavit.

As a result of the foregoing, the Application and Boeriaffidavit did not include the "full and complete statement"concerning the necessity for electronic surveillance required byTitle III. If it had, neither Judge Garrity nor any otherreasonable judge would have granted the request.

The government in this case did far more than fail to informthe issuing judge that Bulger and Flemmi were FBI informants. Ifthe required disclosures had been made, they would have revealedthe following.

Bulger and Flemmi were longstanding FBI informants. The FBI hadfor many years known of their involvement in gambling,loansharking, extortion, and other Title 18 offenses. See,e.g., Ex. 271. Some of this information came from Bulger andFlemmi themselves. Exs. 40, 45, 46, 60, 70, 71, 72, 73, 74, 171,271. For example, beginning prior to 1970, Flemmi had "told theFBI that he was engaged in illegal gambling and other illegalactivity of a non-violent nature." Ex. 271. The governmentbelieves that it would be legally permissible to use Bulger andFlemmi's statements against them. Nov. 12, 1998 Tr. at 141-43;Apr. 13, 1999 Tr. at 154-55; Gov. Post-Hearing Brief at 110-23.The FBI, however, would not provide those statements to anyprosecutor for use in a grand jury or judicial proceeding. Norwould the FBI use evidence generated by the electronicsurveillance being requested to investigate any Title 18 offenseBulger, Flemmi, or Kaufman might be committing. Rather, the FBIregarded its sources' involvement in criminal activity ascritical to their maintaining the credibility necessary for themto continue to obtain and provide the FBI important informationconcerning members of the LCN and other criminals.

Moreover, if fully informed, a reasonable judge would haveconsiderable doubts about whether the activity of Bulger andFlemmi alleged in the Boeri affidavit were criminal at all,rather than authorized by the FBI. More specifically, the judgewould have been informed that a review of the FBI files by theFBI's Principal Legal Adviser in Boston would indicate that:

[There were] some [documents regarding information provided by the informant], primarily in the files pertaining to [Flemmi] which pertain to information which clearly reflected that this informant was engaged in illegal gambling activity at a very high level within the Winter Hill Gang. Moreover, it showed that this informant had a close working relationship with the LCN in making policy decisions regarding illegal gambling in the Boston area, which both the Winter Hill group and the LCN agreed to abide by. The serials disclosing this kind of information were dated in the middle 1980's. Similar information from this informant was also found in the file prior to 1980. The information in the file prior to 1970 indicated that this informant told the FBI that he was engaged in illegal gambling activities and other illegal activity of a non-violent nature. In one instance, source advised that he was involved in administering a severe beating to an organized crime figure who had stepped out of line. Because these serials were in [Flemmi's] file, there was a clear indication that FBI Agents were aware of his involvement in illegal activity (primarily illegal gambling activity) and at least had tacitly authorized his participation in such activity. Nowhere in the files pertaining to [Flemmi] was there any express authorization to commit criminal activity from any FBI Agent.

Ex. 271 (emphasis added).

In addition, a fully informed judge would also have doubtedwhether Bulger, Flemmi, or their colleague Kaufman were genuinelyengaged in any narcotics offenses. More specifically, the judgewould have known that Ring felt that any indication that Bulgerand Flemmi were involved with drugs was "not consistent with [theFBI's] intelligence" regarding them, Ex. 13, and that theirhandler, Connolly, was concerned that Flemmi's "contacts, at[Connolly's] direction . . . may have resulted in the falsebelief that [Flemmi] is involved in narcotics," Ex. 8.

If given the foregoing information, no reasonable judge wouldhave entered the Order that Judge Garrity issued on December 24,1984. It was issued, however, and Bulger and Flemmi quicklylearned of the wiretap.

More specifically, soon after December 24, 1984, Connolly,Bulger, and Flemmi were discussing the Kaufman wiretap and otherelements of the ongoing investigation. As described earlier,Flemmi acknowledges that he was told by the FBI of the Kaufmanwiretap, and the court concludes that it was Connolly, ratherthan Ring as Flemmi claims, who provided the tip. Flemmi Aug. 24,1998 Tr. at 86-87. This conclusion is reinforced by the fact thatin late 1984 or early 1985, Connolly began meeting with Bulgerand Flemmi at Newton's apartment, rather than at Bulger's home orhis own, because Connolly needed a new, secure location. NewtonMay 22, 1998 Tr. at 126-27. It is also likely that Flemmi hadaccess to any information known to Naimovitch, who, in 1980, hadalerted him to the bug at the Lancaster Street Garage, and waslater convicted on charges of corruption.

Among other things, Connolly reported that on December 26,1984, he discussed with Bulger and Flemmi the physicalsurveillances being conducted against them. Ex. 14. (Memorandumdated 12/28/84). This meeting would have provided an occasion forhim to discuss the Kaufman wiretap as well. In an ostensibleeffort to be helpful, Connolly provided Ring and Greenleafdetailed information about the surveillance vehicles Bulger andFlemmi had identified as part of the investigationof them. Id.41 Greenleaf forwarded this information toStutman. Id. While Greenleaf was motivated by a desire to begenuinely cooperative, the practical effect of telling the DEAthat Bulger and Flemmi were alert to its investigation could havebeen to discourage further efforts.

The DEA was not deterred by the information Greenleaf hadfurnished. On February 1, 1985, Crossen submitted to Judge Tauroa ninety-five-page affidavit from Boeri seeking renewal of thewiretap on Kaufman's telephone and additional authority to bugBulger's automobile and residence as well. Ex. 135. The requestfor authority for a wiretap and two bugs in a single applicationmay have been unlawful. See Feb. 6, 1997 Tr. at 5-6, 16-27. Inany event, it made the affidavit confusing on the issues ofprobable cause, among other things, by obscuring key facts.

The February 1, 1985 Boeri affidavit incorporated his earlieraffidavit. Id. at 2 (¶ 5). It stated that the FBI was part ofthe continuing joint investigation. Id. at 2 (¶ 6). Thegovernment acknowledges that the FBI was part of the jointinvestigation by February 1, 1985. See Gov. Post-Hearing Brief319-23; Dec. 2, 1998 Tr. at 122-23. There was no indication inBoeri's affidavit that the FBI was not receiving the informationbeing generated by the electronic surveillance for use in itspurported investigation of Bulger and Flemmi for possibleprosecution on Title 18 charges. Crossen May 13, 1998 Tr. at 76.

In his affidavit Boeri asserted that there was probable causeto believe that "wire communications" of Bulger would be obtainedif the wiretap on Kaufman's telephone were reauthorized. Ex. 135at 3 (¶ 7(b)). This representation was not true and, indeed, wasmade with at least reckless disregard for the truth. As describedearlier, the pen registers had disclosed no calls between Bulgerand Kaufman prior to December 24, 1984. Ex. 133 at 69-100; BoeriMay 18, 1998 Tr. at 14-16. The initial wiretap of Kaufman'stelephone did not intercept any conversations with Bulger either.Boeri May 18, 1985 Tr. at 23, 26-27.

Flemmi continued to call Kaufman in an effort to mask the factthat he had been tipped off to the tap, but engaged only ininnocuous conversation. Flemmi Aug. 26, 1998 Tr. at 99-100. JohnMartorano, who was still a fugitive, was also intercepted. Jan.8, 1998 Tr. at 96.

Boeri's February 1, 1985 affidavit also claimed that there wasprobable cause to believe that if the requested electronicsurveillance was authorized, Bulger, Flemmi, Kaufman, and theother named targets would be intercepted discussing thedistribution of marijuana and cocaine. Ex. 135 at 3 (¶ 7(a) and(b)). As Boeri now acknowledges, the prior month of intercepts,however, had provided no evidence that Bulger and Flemmi woulddiscuss drug activity on Kaufman's telephone. Boeri May 15, 1998Tr. at 23-24. Moreover, the ninety-five-page affidavit includesonly two references to drugs at all. In one instance Kaufman saidthat a bookmaker, who Boeri in the affidavit stated had noconnections with Bulger, Flemmi, Kaufman, or the Winter HillGang, also sold "junk" — meaning drugs. Ex. 135 at 14-15 (¶¶ 24and 25); Boeri May 15, 1998 Tr. at 18-23. In the other instances,Kaufman asked an unknown male if an individual named "Allen" wasin the "junk" business and was told "yes." Id. at 70 (¶ 128).If Boeri's affidavit had been presented in support of a requestfor authority to conduct electronic surveillance for the purposeof developing only a Title 21 narcotics prosecution, it wouldhave been obviously insufficient to justify an extension orexpansion of the original order. Thus, the false and misleadingmessage, conveyed by the affidavit, that the FBI was conducting agenuine Title 18 investigation of Bulger, Flemmi,Kaufman, or anyone else was, again, highly material.

Judge Tauro issued the requested order authorizing thecontinued wiretap on Kaufman's telephone and the bugging ofBulger's automobile and residence as well. For the reasonsdescribed earlier, neither he nor any other reasonable judgewould have done so if the required full and complete statementconcerning necessity had been made.

While the wiretap on Kaufman's telephone did not interceptBulger, it did result in Zannino being overheard. Ex. 176.O'Sullivan was informed and alarmed because the interception hadthe potential to complicate the pending prosecution of Zannino.Id. O'Sullivan consulted Ring. Id. To prevent furtherproblems, at some point prior to February 7, 1985, Ring was askedto remove Carter and Rossi from the work they were doing with theDEA, and to instruct them not to discuss the statements Zanninohad been overheard making with anyone at the FBI or to introducethem into the FBI's files. Id. The court concludes that thiswas done.

Not surprisingly, there was a "stunning lack of success" fromthe bugging of Bulger's home and automobile. Crossen May 12, 1998Tr. at 153. Indeed, the government has represented that it doesnot wish to offer any evidence from these bugs in its case inchief. Gov. Post-Hearing Brief at 316-17; Nov. 20, 1998 Tr. at113. The bug in Bulger's car, however, did intercept Flemmitelling Bulger that Connolly had become "a little . . . nervous."Ex. 136 at 18 (¶ 21); Crossen May 12, 1998 Tr. at 149-50.

On March 1, 1985, Crossen presented to Judge A. David Mazzone aforty-page affidavit of Boeri seeking authority to extend thebugs in Bulger's home and automobile, but not the wiretap onKaufman telephone. Ex. 136. The prior applications and affidavitswere incorporated in that request. Id. at 2 (¶¶ 5 and 6). Asindicated earlier, Boeri again represented that the FBI was partof the joint investigation and that there was probable cause tobelieve that evidence concerning illegal gambling, as well asnarcotics offenses, would be intercepted. Id. at 2 (¶ 7) 3-5 (¶8). Boeri again claimed that electronic surveillance wasnecessary to obtain evidence of these offenses. Id. at 5 (¶10).

However, it appears that the representation that the FBI wasstill involved in the joint investigation was false because, asdirected by O'Sullivan, Rossi and Carter were no longerparticipating. In any event, contrary to the message communicatedby the affidavit, the FBI continued to have no intention ofutilizing evidence obtained from the electronic surveillance inany investigation of Bulger or Flemmi. Not knowing this, or anyof the other material information that the required full andcomplete statement concerning necessity would have included,Judge Mazzone entered the government's proposed order.

The extended authorization for the bugs, however, was of novalue to the investigation. On March 11, 1985, Bulger found thebug in his car. Ex. 142. Just before he pulled it out, Boeri andReilly, who were monitoring the bug, heard Bulger say: "He'sright. They did put a bug in the car." Ex. 145; Reilly May 20,1998 Tr. at 16. That statement reinforced Reilly's belief thatBulger and Flemmi were FBI informants. Reilly May 20, 1998 Tr. at16.

As the electronic equipment cost $15-20,000, Boeri and Reillyrushed into the garage to recover it. Ex. 142; Weld May 26, 1998Tr. at 69. Bulger expressed surprise that they were able to bughis automobile. Ex. 142. Bulger also told the agents: "We're allgood guys here. You're the good good guys, and we're the bad goodguys." Boeri May 18, 1998 Tr. at 81-83; Weld May 26, 1998 Tr. at69. Bulger did not, however, claim to have immunity frominvestigation by the DEA or prosecution if a case against himcould be developed. Ex. 142.

Two days later, on March 13, 1985, Bulger approached Boeri, whowas conducting a physical surveillance him. Ex. 141.Bulger knew Boeri's name and the location of the supposedlysecret site where the monitoring of the wiretaps and bugs hadbeen conducted in an effort to maintain the confidentiality ofthe investigation. Id.

At this point, the DEA and the United States Attorney's Officeaccepted that the confidentiality of the investigation generally,and the electronic surveillance particularly, had beencompromised. Ex. 145; Reilly May 20, 1998 Tr. at 16; Weld May 26,1998 Tr. at 68. Although the DEA made some follow-up efforts, itslengthy and expensive investigation was deemed unsuccessful andwas eventually closed. Reilly May 20, 1998 Tr. at 119; Weld May26, 1999 Tr. at 70; Ex. 145. The DEA shared with the IRS some ofthe information concerning Bulger and Flemmi that it haddeveloped. Ex. 145; Reilly May 20, 1998 Tr. at 119. Believingthat the FBI had compromised their investigation and would notitself investigate Bulger and Flemmi, the DEA agents did notoffer the FBI any evidence that they had obtained relating topotential Title 18 offenses, including information concerning theValhalla. Reilly May 20, 1998 Tr. at 119. Nor did the FBI everask for any such evidence. Id. at 46-47.

In an attempt to give some redeeming value to his futileinvestigation, Boeri decided to try to recruit Flemmi and Bulgeras informants for the DEA. Boeri May 11, 1998 Tr. at 111. Boerisent Flemmi and Bulger cards congratulating them on frustratingthe DEA's investigation and a box of cigars. Boeri May 18, 1998Tr. at 109-12. He also gave Flemmi, a former paratrooper, a tapeof army motivational marching chants. Id. Boeri's efforts wereunavailing, however. Bulger and Flemmi evidently recognized thatthey had a good deal with the FBI and were not interested inworking with the DEA.

18. Morris Tells Bulger and Flemmi That They Can Do Anything They Want as Long as They Do Not "Clip" Anyone

In April 1985, Connolly, Morris, Condon, Bulger, and Flemmi metfor dinner at Morris' home in Lexington, Massachusetts. FlemmiAug. 20, 1998 Tr. at 5; Condon May 1, 1998 Tr. at 108-10. Thedinner was held several weeks after Bulger found the bug in hiscar and it had become obvious that the investigation led by theDEA would not succeed. Bulger and Flemmi brought a bottle of wineand, for the first time, also a bottle of champagne. Flemmi Aug.20, 1998 Tr. at 10.

The dinner was evidently planned to celebrate the failure ofthe effort to investigate Bulger and Flemmi. Ring was not invitedto attend. Meetings with Ring, Flemmi had found, were "strictlybusiness." Flemmi Aug. 27, 1998 Tr. at 64, Aug. 28, 1998 Tr. at5-6. Condon, however, was included. He was then serving as theUndersecretary of Public Safety for the Commonwealth ofMassachusetts. Condon May 1, 1998 Tr. at 108-10. TheMassachusetts State Police was one of several agencies he sharedresponsibility for supervising. Id. at 92-94.

Condon spent about an hour eating dinner and participating inthe discussion before leaving. Condon May 1, 1998 Tr. at 117. Theconversation then turned to the Angiulo wiretaps. Flemmi Aug. 20,1998 Tr. at 14-15, Aug. 26, 1998 Tr. at 153-56. Flemmi and Bulgerknew that they had been discussed in some of the interceptedconversations. Id. They again expressed concern about whetherthe information on those tapes might be used against them in aninvestigation or prosecution. Id. Morris and Connolly told themnot to worry because they would not be prosecuted for anything onthose tapes. Id. Morris went on to say to Bulger and Flemmi,"[y]ou can do anything you want as long as you don't `clip'anyone." Id.; Ex. 92, ¶ 2; Condon May 1, 1998 Tr. at 122-25;Newton May 28, 1998 Tr. at 140-41. Morris was not inebriated whenhe made this statement. Flemmi Aug. 20, 1998 Tr. at 10, Aug. 27,1998 Tr. at 72; Morris Apr. 23, 1998 Tr. at 88-90.

Morris' comment contributed to Flemmi's understanding that theFBI would protect him from investigation of and possibleprosecution for any crime he might be a threat to commit otherthan murder — although, as described previously, in the Halloranmatter the Bureau had done even that. Ex. 92.

Morris testified that he did not recall telling Bulger andFlemmi that they could do anything they wanted as long as theydid not "clip" anyone and doubted that he did so. Morris Apr. 29,1998 Tr. at 90-91. Nevertheless, the court finds that thestatement, as related by Flemmi, was made.

It is possible that Morris merely forgot a comment that he madethirteen years before his testimony. If the matter does notinvolve a failure of recollection, however, Morris has againlied. Morris acknowledges that he has a long history of lying toprotect himself. Morris Apr. 27, 1998 Tr. at 151, 163, Apr. 30,1998 Tr. at 90. He lied to his superiors about his conductconcerning the Lancaster Street Garage investigation. Morris Apr.30, 1998 Tr. at 85. Morris also lied to SAC Ahearn when he deniedthat he had advised Ring to close Bulger as an informant. Id.at 91-92. In addition, as discussed in § II.27, infra, aftertelling a Boston Globe reporter that Bulger was an FBIinformant, Morris lied in claiming that he was not the source ofthat and other leaks in interviews with agents from the FBI'sOffice of Professional Responsibility ("OPR") and later in twowritten, sworn statements, although he knew that his conduct wascriminal. Morris Apr. 27, 1998 Tr. at 151-56, 163, Apr. 30, 1998Tr. at 93. In each instance Morris was motivated by a desire toprotect himself and to avoid possible prosecution. Morris Apr.27, 1998 Tr. at 51.

Morris had the same incentive to lie about whether he in factor in effect told Bulger and Flemmi, in 1985, that they could doanything they wanted, as long as they did not kill anyone, andwould be protected. Flemmi's claim that this statement was madecontributed to the court's decision to grant his motion for anevidentiary hearing on the issue of immunity. Ex. 92. When Morrismade his proffer it was evident that he might not be givenimmunity by the prosecutors in exchange for his testimony if hecorroborated Flemmi's claim on this point. His concern was notonly understandable, it was well-founded. As discussed in §II.33, infra, the court has since determined that thegovernment's refusal to grant Connolly immunity was motivated inpart by genuine interest in investigating him for possibleprosecution, and also in part by "a desire not to facilitate theintroduction of evidence that the government expects wouldsubstantially corroborate Flemmi and might hurt its case, as wellas embarrass the government." Oct. 16, 1998 Tr. at 23.

Although the court need not decide whether Morris' failure toacknowledge the now controversial statement that he made toBulger and Flemmi in April 1985 is an innocent failure of memoryor another willful lie, the court does find Flemmi'scharacterization of that statement to be correct.

In addition, at the April 1985 meeting Morris and Connolly toldBulger and Flemmi about sources that the FBI and other lawenforcement had who were members or associates of the LCN. FlemmiAug. 20, 1998 Tr. at 16-17. Bulger and Flemmi were encouraged tostay away from those individuals in order to protect themselves.Id.

Shortly before they left Morris' home, Bulger told Flemmi thathe wanted to loan Morris $5000 to help him out with financialproblems Morris was having. Id. at 19-21; Ex. 30, ¶ 16. Flemmigave Bulger $3000. Id. Morris was having financial difficultiesdue to medical problems in his family. Morris Apr. 23, 1998 Tr.at 142-43. Bulger told Morris that he wanted to help him out andgave Morris $5000 in cash. Id. at 142-44, Apr. 29, 1998 Tr. at56-57, 67; Ex. 30, ¶ 16; Flemmi Aug. 20, 1998 Tr. at 19-21,Aug. 28, 1998 Tr. at 35; Newton June 2, 1998 Tr. at 7-8.

Morris never returned or repaid the $5000. Morris Apr. 23, 1998Tr. at 144; Ex. 30, ¶ 16; Flemmi Aug. 20, 1998 Tr. at 20. Nor washe ever asked to do so by Flemmi or Bulger. Flemmi Aug. 20, 1998Tr. at 20.

19. Dining with "Donnie Brasco"

In June 1985, the trial of Gennaro Angiulo and several of hiscodefendants began. Kottmyer Aug. 13, 1998 Tr. at 165, Aug. 14,1998 Tr. at 139; Flemmi Sept. 15, 1998 Tr. at 35, Nov. 20, 1998Tr. at 63-64. It culminated in Angiulo's conviction in February1986. Nov. 20, 1998 Tr. at 63-64.

With Connolly's assistance, Bulger and Flemmi had evaded theDEA's efforts to have them prosecuted and continued to be highlyvalued allies in the FBI's war against the LCN. The character andquality of this alliance was exemplified by a dinner that Bulgerand Flemmi had with Connolly, Nick Gianturco, Jules Bonovolenta,and Joe Pistone.

At about the time of the Angiulo trial, Bonovolenta andPistone, who were from New York, were in Boston to review somedocuments in preparation for possibly testifying as experts inthe Angiulo case or some other LCN prosecution. Gianturco Jan.15, 1998 Tr. at 125-26, 156-57, Apr. 20, 1998 Tr. at 26, 35.Bonovolenta was the ASAC in New York City, who was in charge ofthe FBI's Organized Crime Division. Gianturco Jan. 20, 1998 Tr.at 83-84. Pistone, who had recently left the FBI, was renownedfor having, as "Donnie Brasco," infiltrated the LCN in New YorkCity and for testifying in many successful Mafia prosecutions.Id. at 82, Gianturco Jan. 20, 1998 Tr. at 130-31, Apr. 20, 1998Tr. at 26-30, 34. As a result, it was understood that there was a$500,000 "contract" out on Pistone's life. Gianturco Apr. 20,1998 Tr. at 28-29. Thus, precautions were being taken to assurethe secrecy of Pistone's location and activities. Id.

Gianturco had worked with Bonovolenta and Pistone in New York.Gianturco Jan. 15, 1998 Tr. at 125. With Connolly's concurrence,when his friends were in Boston, Gianturco invited them to hishome for dinner with Bulger and Flemmi. Id. at 159-60.Gianturco had complete confidence that Bulger and Flemmi would donothing to endanger Pistone. Gianturco Apr. 20, 1998 Tr. at 30.Pistone had recently received the Attorney General's Award forDistinguished Service. Id. at 28. By being invited to dine withPistone and Bonovolenta, Flemmi and Bulger could also rightlyregard themselves as honored members of the government's teamcombatting the LCN.

Bulger and Flemmi soon validated again their value to the FBIby making an indispensable contribution to the successful effortto incarcerate Angiulo's successors in the Boston LCN — JoeRusso, Vincent Ferrara, and Robert Carrozza. Indeed, ultimatelyFlemmi particularly contributed to the successful prosecution ofRaymond J. Patriarca, who had, as Flemmi reported, succeeded hisfather as Boss of the Family.

20. Vanessa's

By mid-1986 Angiulo and his codefendants had been convicted andZannino, who was ill, was incapacitated while awaiting trial. TheLCN in Boston was diminished and in disarray. This created atemporary vacuum which, according to their plan, Flemmi andBulger sought to fill by expanding their own criminal activities.

More specifically, Flemmi understood that he and Bulger hadformed a partnership with the FBI, which had "taken down" the LCNin Boston. Flemmi Aug. 28, 1998 Tr. at 119-20. This provided anopportunity for Bulger and Flemmi to take over criminalactivities in Boston that had previously been controlled by theLCN. Id. With the protection of the FBI, Bulger and Flemmicould operate very profitably. Id., Aug. 25, 1998 Tr. at 31.Basically, Flemmi had been led to reasonably understandthat he could "extort people, earn a living as a criminal, andnot get prosecuted if [he gave] information to the FBI." Id.This was an important benefit of his bargain with the FBIbecause, for Flemmi, making money was "the name of the game."Id.

After Angiulo was convicted, the FBI's conduct continued to beconsistent with Flemmi's understanding of his arrangement withthe Bureau. For example, one of Morris' informants reported thatbookmakers who were "with" Angiulo were receiving very littledirection from the remnants of his regime; Flemmi was challengingthe LCN by "taking over" its bookmakers and numbers agents; andthe LCN was unable to do anything to stop him. Ex. 61. Yet theFBI made no effort to investigate these allegations.

Initially, the LCN sought to deal with the situation describedby Morris' informant by proposing to make Flemmi a member. Ex.123. Flemmi, however, remained uninterested in the offer. As aninformant told Connolly:

Flemmi would not want membership inasmuch as he is an independent person and would not want to be subject to the rules of the Mafia . . . Flemmi does not need the headaches and he, along with Whitey Bulger, are "their own bosses with their own things going for them."

Id.; Ahearn May 7, 1998 Tr. at 139.

The LCN was not, however, the only organization interested informalizing its relationship with Flemmi. In July 1986, theBureau in Boston requested authority from FBI Headquarters toreopen Flemmi as an informant. Id. at 89-90; Ex. 110. Therequest described Flemmi as a proposed member of the LCN, who"remains in a position to provide valuable information at thepolicymaking level of the Boston LCN." Id.42

Connolly, Ring, and their colleagues were very interested intargeting and immobilizing Angiulo and Zannino's successors. Aspredicted in the request that he be reopened, Flemmi proved to bean invaluable asset in that effort.

Beginning in April 1986, Flemmi reported to Connolly on theactivities of Russo and Ferrara, who were emerging as the newleaders of the LCN in Boston, and their colleagues, Carrozza,Mercurio, Dennis Lepore, and Biagio DiGiacomo. Exs. 16, 17, 18,117, 118, 128. He also provided information concerning LCNmembers in Providence, including Patriarca, Matthew Gugliametti,and Anthony St. Laurant. Exs. 117, 211.

As Flemmi explained to Connolly, the LCN in Boston wanted toestablish a cooperative relationship with Bulger and him in orderto minimize the threat that they posed. Ex. 117. Mercurio, whowas already friendly with Bulger and Flemmi, took a leading rolein this effort. Id. Flemmi also reported that Mercurio, who hadrecently been released from prison, was bitter toward theAngiulos. Id.

Flemmi told Connolly that the LCN wanted to meet with Bulgerand him to discuss the payoff on the illegal numbers and othergambling issues. Ex. 117. The FBI was very interested in theinformation such meetings would generate.

Flemmi subsequently met several times with members of theBoston LCN in a storeroom of Vanessa's, a restaurant owned byMercurio. Exs. 16, 17, 118. Flemmi told Connolly about at leastsome of the meetings in advance. Exs. 117, 118. As requested byConnolly, he also reported on what was discussed. Flemmi Aug.29, 1998 Tr. at 91-95; Exs. 16, 17, 118. Among other things,Flemmi described the LCN's plans concerning: illegal footballcards; changing the payoff odds on the illegal numbers; theextortion of bookmakers generally; and, particularly, a scheme toobtain money from "Doc" Sagansky, who was a major bookmaker. Exs.16, 17, 118.

The FBI promptly decided to target Vanessa's for electronicsurveillance. In addition to utilizing Flemmi and Bulger toobtain information necessary for the application for a warrant,Flemmi was asked to obtain valuable logistical informationconcerning Vanessa's. Flemmi Aug. 20, 1998 Tr. at 95. Forexample, at Connolly's request, Flemmi reported that participantsaccessed the storeroom by taking a service elevator, and that thestoreroom had an alarm system which was not operative. Exs. 16,17. At Ring's request, Flemmi provided the FBI with a detaileddiagram of the storeroom. Flemmi Aug. 20, 1998 Tr. at 94-95;Carter Aug. 17, 1998 Tr. at 55; Ex. 209.

As a result of these requests, Flemmi correctly understood thatthe FBI was planning to bug Vanessa's. Flemmi Aug. 20, 1998 Tr.at 95; Ring June 15, 1998 Tr. at 17-18. Connolly told Flemmi whenthe bug was installed. Id. at 95-96. As a result, Flemmi andBulger stayed away from Vanessa's and, as with 98 Prince Street,neither was intercepted. Id.; Carter Aug. 8, 1998 Tr. at 56,106.

In contrast to 98 Prince Street, however, there is no evidencethere was any discussion of whether any evidence acquired by thebug at Vanessa's would be used against Bulger or Flemmi. However,Flemmi believed that because the FBI had asked him to obtaininformation concerning Vanessa's, as it had asked him to obtaininformation about 98 Prince Street, he would have the sameprotection with regard to any evidence intercepted at Vanessa'sas he had concerning the evidence intercepted at 98 PrinceStreet. Flemmi Aug. 27, 1998 Tr. at 70. This understanding wasreasonable.

The application for the warrant to bug Vanessa's was filed onOctober 31, 1986. Ex. 153. The supporting affidavit was submittedby Carter. Id. Most, if not all, of the information containedin the affidavit was provided to Carter by Connolly, who reviewedthe affidavit. Flemmi and Bulger were two of the threeconfidential sources relied upon in the affidavit. Carter Aug.18, 1998 Tr. at 33; Coffey Aff., Apr. 9, 1997, at 3; Ex. 109. Thecourt concludes that but for the information provided by Flemmiand Bulger, the government could not have obtained the warrant tobug Vanessa's. Carter Aug. 17, 1998 Tr. at 47-48, 51-52, 54, 105;Ex. 207.

Ring generally supervised the preparation of the affidavit.Ring June 15, 1998 Tr. at 14. In addition, the affidavit wasreviewed at FBI Headquarters. Carter Aug. 17, 1998 Tr. at 107-09.

At some point in 1985, Carter had been told that Bulger andFlemmi were FBI informants. Id. at 102. He understood that theywere two of the three sources who had supplied much of theinformation for his affidavit. Id. at 51-52, Aug. 18, 1998 Tr.at 33; Coffey Aff., Apr. 9, 1997, at 3. For example, Carter knewthat Flemmi was the source of the diagram of Vanessa's that heincluded in his affidavit. Id. at 105. It was Carter'sunderstanding that Flemmi's statements to Connolly could not beused against him, at least directly. Id. at 164-65. Theaffidavit was sent to FBI Headquarters in a manner that revealedthat Bulger and Flemmi were both two of the named targets and twoof the three referenced sources. Id. at 107-09.

Morris testified that it was a common practice for the FBI toname sources who had provided information for an affidavit astargets in applications seeking authority to conduct electronicsurveillance in an effort to mask their status as informants.Morris Apr. 30, 1998 Tr. at 171-72. This practice was followedwith regard to Bulger and Flemmi in Carter's affidavit concerningVanessa's.43 In the process, the FBI intentionally, and withreckless disregard for the truth, prepared an affidavit that wasfalse and misleading with regard to Flemmi and Bulger, and causedit to be authorized for filing and submitted by attorneys in theDepartment of Justice who were not informed of its deceptivecharacter. Carter Aug. 17, 1998 Tr. at 110; Weld May 27, 1998 Tr.at 109-12.

For example, the application and Carter affidavit representedthat there was probable cause to believe that Bulger and Flemmi,among others, were conspiring with Russo, Ferrara, and theirassociates to conduct an illegal gambling business and a RICOenterprise. Ex. 153. The submissions also stated that Flemmi andBulger were expected to be intercepted if the request to bugVanessa's was allowed. Id. The application and affidavitrepresented that the requested electronic surveillance wasnecessary with regard to Bulger and Flemmi, among others. Id.The clear import of the submissions was that the FBI would employany evidence that it intercepted to try to develop a prosecutablecase against Flemmi and Bulger, as well as the other namedtargets.

Based on the collective knowledge of the participants, the FBIwell knew that none of this was true. There was no reason tobelieve that Flemmi or Bulger would visit Vanessa's while it wasbugged and be intercepted. Carter certainly did not expect thatthey would. Carter Aug. 18, 1998 Tr. at 166. Moreover, in view oftheir close cooperation with the FBI concerning Vanessa's, it wasdoubtful that any conversation in which Flemmi and Bulger mightengage there could properly be deemed criminal activity ratherthan conduct authorized by the government. In any event, withregard to necessity, the FBI had relevant statements by Bulgerand Flemmi that it now claims are not immunized. Nov. 12, 1998Tr. at 141-43; Apr. 13, 1999 Tr. at 154-56; Gov. Post-HearingBrief at 110-123. In addition, the FBI had no intention ofinvestigating Flemmi or Bulger based on any information generatedby the bugging of Vanessa's.

While the FBI knew that the submissions seeking authority tobug Vanessa's were deceptive, the Department of Justice attorneyswho were involved in the matter did not. Honoring the FBI'spromise of confidentiality to Bulger and Flemmi, Carter did nottell the Strike Force Attorney with whom he was working, JaneSerene, that Flemmi and Bulger were FBI informants. Carter Aug.17, 1998 Tr. at 110. Thus, he did not discuss with her thelegality of including them as both sources and purported targetsin the application and affidavit. Id. Nor did he discuss thisissue with anyone at the FBI. Id.

In October 1986, Weld became the Assistant Attorney General incharge of the Criminal Division. Weld May 26, 1998 Tr. at 5. Assuch, he authorized the application for the Vanessa's bug. Ex.153. Weld reviewed the application before authorizing itssubmission. Weld May 27, 1998 Tr. at 50. His prior experience inBoston, including the unsuccessful 1984-85 electronicsurveillance targeting Bulger and Flemmi, provided reason for himto question the FBI's representations concerning them, but Welddid not. Weld May 27, 1998 Tr. at 92, 97-98. Nor was Weld toldthat Bulger and Flemmi were two of the informants relied upon inthe affidavit, as well as named targets. Id. at 51-52.

If Weld had understood that Bulger and Flemmi were informants,he would have seriously questioned the necessity for the proposedelectronic surveillance. Id. at67-68, 88, 110-13. Even if they were reluctant to testifyvoluntarily, Weld would have considered seeking an orderproviding them immunity and compelling them to do so. Id. at87. In any event, Weld would not have permitted the applicationand affidavit which were false and misleading with regard toBulger and Flemmi to be filed. Id. at 110-13.

Weld understood that deliberately providing false informationin an application for a warrant could constitute perjury and, inany event, would "undercut the entire process that Congressenacted . . . to hedge . . . the . . . authorization ofelectronic surveillance." Id. at 108-09. Thus, if properlyinformed, Weld would have insisted that all of the false andmisleading statements in the proposed affidavit be corrected ordeleted, or that the application not be submitted to the court.Id. at 87-88, 109-12.

In essence, if Weld had requested or received all of therelevant information regarding Bulger and Flemmi, a politicallyaccountable official would have made the informed judgmentconcerning the propriety of the proposed application that TitleIII contemplates. The FBI's determination both to honor itspromise not to disclose to anyone outside the Bureau that Bulgerand Flemmi were informants and to perpetuate their ability toserve as sources prevented that informed judgment from being madewith regard to Vanessa's.

The Application and Carter affidavit were submitted on October31, 1986, and approved by Judge William Young the same day. Ex.153; Coffey Aff., Apr. 9, 1997, at 3. The government received aseries of extensions and the storeroom of Vanessa's was buggeduntil June 1987. Flemmi and Bulger provided information reliedupon in some, but not all, of the requests for extensions. CoffeyAff., Apr. 9, 1997, at 3. The electronic surveillance ofVanessa's was terminated after Mercurio secretly found the bugs,and reported to Bulger that he, Ferrara, and others had begunmaking exculpatory statements in an effort to help themselves.Ex. 175.

Before it was discovered, the electronic surveillance ofVanessa's was very productive. Among other things, the bugintercepted the successful extortion of $250,000 from Saganskyand his colleague Mo Weinstein that Flemmi had predicted. RingJune 4, 1998 Tr. at 108-09; Kottmyer Aug. 12, 1998 Tr. at 61.That evidence was eventually used as a cornerstone of thesuccessful prosecution of Russo, Ferrara, Mercurio, and othermembers of the Boston LCN. See Carrozza, 807 F. Supp. at 156. Inaddition, as described in § II.29, infra, after Vanessa's wassearched pursuant to a warrant issued in the spring of 1987, thefruits of the bug gave the FBI powerful leverage in itssuccessful effort to convert Mercurio promptly into an informant.Ring June 15, 1998 Tr. at 45; Ex. 113. As Flemmi reported, theRusso faction knew that the Sagansky-Weinstein extortion was abig problem for them and Mercurio did not want to return toprison. Ex. 165.

21. Flemmi Becomes A Top Echelon Informant Again

In November 1986, James Ahearn became the SAC in Boston. AhearnMay 7, 1998 Tr. at 67. Two months earlier, Larry Potts became anASAC in Boston, with responsibility for matters relating to theOrganized Crime squad, among other things. Potts May 21, 1998 Tr.at 9. Potts ultimately went on to hold several of the highestpositions in the FBI, serving as the Assistant Director in chargeof the Criminal Division from 1992 to 1995, and as Acting DeputyDirector in 1995. Id. at 9-10.

Soon after Ahearn became SAC, Potts told him that, "Morrisproposed that Whitey Bulger was no longer providing informationof sufficient value to maintain his relationship as an FBIinformant and should be considered as a subject of investigationrather than as a confidential source." Ex. 134; Ahearn May 11,1998Tr. at 110-11; Ahearn May 7, 1998 Tr. at 92-94; Potts May 22,1998 Tr. at 12, 26. In response, Ahearn asked Potts to conduct a"suitability review" of Bulger and Flemmi. Ahearn May 7, 1998 Tr.at 93; Potts May 21, 1998 Tr. at 28-29, 133.

At that time, the FBI Manual established criteria that were tobe taken into consideration in conducting a suitability review.Ex. 111 (3/28/84, § 137-3.1.1.); Ahearn May 7, 1998 Tr. at 95-98;Potts May 22, 1998 Tr. at 5. Among the factors to be weighed indeciding whether to utilize someone as an informant were:

(a) the nature of the matter under investigation and the importance of the information being furnished as compared to the seriousness of past and contemporaneous criminal activity of which the informant may be suspected.

(e) any record of conformance by the informant to FBI instructions and control in past operations; how closely the FBI will be able to monitor and control the informant's activities insofar as he/she is acting on behalf of the FBI.

Id.

In conducting his review, Potts did not consider the range offactors prescribed by the FBI Manual. Potts May 21, 1998 Tr. at118, 133. He understood that Bulger and Flemmi were engaged incriminal activity. Potts May 22, 1998 Tr. at 9. Potts, however,sought merely to evaluate their productivity, rather than toweigh it against the seriousness of the threat posed by thecrimes Bulger and Flemmi were understood to be committing. PottsMay 21, 1998 Tr. at 118, 133.

Potts reviewed the files of inserts reflecting information thatBulger and Flemmi had provided, and spoke to Morris, Ring,Connolly, and Nick Gianturco. Potts May 21, 1998 Tr. at 34-37;Ahearn May 7, 1998 Tr. at 93. He did not review theadministrative portion of their files, or information provided byother sources concerning Bulger and Flemmi's criminal activity.Potts May 21, 1998 Tr. at 35-37.

Ring and Connolly told Potts that Bulger and Flemmi wereproviding information that was very significant to the organizedcrime program. Potts May 21, 1998 Tr. at 31, 54. Referring inpart to Vanessa's, they emphasized Bulger and Flemmi's ability tosupport successful applications for electronic surveillance.Id. at 31, 56. As the Organized Crime squad then had anotheragent, Vincent Delamontaigne, operating undercover in an attemptto infiltrate the LCN, their potential to help protect him wasparticularly important. Id. at 31. See also United States v.DiGiacomo, 746 F. Supp. 1176 (D.Mass. 1990).

Thus, Potts advised Ahearn that "the information in [Bulger'sinformant] file was of substantial value and in his opinionWhitey Bulger should be maintained as an informant rather than atarget." Ex. 134; Ahearn May 7, 1998 Tr. at 92-93, 103. Pottsevidently made the same recommendation regarding Flemmi. Ahearnconcurred in Potts' recommendations.

At that time the FBI Manual also required that FBI Headquartersreview at least annually the determination by a field office thatan individual was suitable to serve as an informant. Potts May22, 1998 Tr. at 5-6; Ex. 274 (Under Seal), Manual §137-16(1)(D)(5) (3-28-84). Potts' advice to Ahearn was givenorally. Potts May 21, 1998 Tr. at 33-34. Ahearn's decision tocontinue Bulger and Flemmi as informants was not memorialized inwriting at that time. Thus, it was never reviewed by FBIHeadquarters.

This deviation from the requirements of the Manual was,however, immaterial. In Potts' vast experience, FBI Headquartershad never reversed a field office's decision that an individualwas suitable to serve as an informant. Potts May 22, 1998 Tr. at6-8. Essentially, the supervisor of the informant's handler wasthe "critical," "chief decision maker" regarding whether or notan informant should be opened or continued. Id. at 8. In Potts'experience,the SACs, ASACs, and FBI Headquarters all relied on the squadsupervisors to comply with the Guidelines and Manual provisionsconcerning informants, including the reporting requirementsregarding unauthorized criminal conduct by informants. Id. at809.

Moreover, in Potts' extensive experience no informant had everbeen targeted for investigation based on statements he had madeto the FBI. Potts May 22, 1998 Tr. at 24-25, 48-49, 64-65. Pottsknew of no instance in which an informant's statements to the FBIhad been used against him directly or to obtain electronicsurveillance targeting him. Id. at 28-29, 48. Nor did Pottsknow of any instance in which a 209 including information that aninformant had furnished to the FBI was provided to another lawenforcement agency to prompt or facilitate an investigation ofthe Bureau's source. Id. at 25, 27, 65.

In any event, following Potts' review and Ahearn's decision, onFebruary 2, 1987, the Boston office of the FBI informedHeadquarters that a suitability inquiry had been conducted, thatRing, as Connolly's supervisor, had certified that Flemmi was anappropriate candidate, and that Flemmi was being opened as aninformant. Ex. 15. The report noted that Flemmi "has been activein gambling and loansharking." Id. It emphasized hissignificant contribution to the bugging of Vanessa's and to apolice corruption investigation as well. Id.

Following the conclusion of the electronic surveillance ofVanessa's, in December 1987, Flemmi was designated a Top Echeloninformant. Exs. 109, 268. In the request that he be elevated tothat status, Flemmi was described as the Winter Hill Gang'sliaison with the Mafia, a source of valuable information leadingto the electronic surveillance of Vanessa's, and a person whowould continue to provide high quality information. Ex. 109. Inapproving the request, FBI Headquarters congratulated the Bostonoffice for developing such a fine informant. Ex. 268. Thus,Flemmi regained the title of Top Echelon informant that he hadrelinquished when, after being warned of his impendingindictments by Rico, he became a fugitive in 1969.

22. Raymond Slinger

As described earlier, Ahearn had asked Potts to evaluatewhether Bulger "should be considered as a subject ofinvestigation rather than as a confidential source." Ex. 134;Ahearn May 11, 1998 Tr. at 110-11 (emphasis added). Potts'conducted his review and reported that "Bulger should bemaintained as an informant rather than a target." Id.(emphasis added). As Ahearn's formulation of the question andPotts' answer indicate, the FBI generally viewed the roles of FBIinformant and target of FBI investigation to be mutuallyexclusive. Indeed, as explained in § II.9, supra, that is whyBulger was closed as an informant when he became a primarysubject of the race-fix investigation. The lengths to which theFBI would go to protect Bulger and Flemmi because of their valueas Top Echelon informants, rather than target them forprosecution, is vividly demonstrated by the manner in which itdealt with Raymond Slinger in 1987.

At that time Slinger was a real estate broker in South Boston.Slinger Sept. 23, 1998 Tr. at 71. In 1986, he was introduced toBulger and Flemmi, by Kevin O'Neil, to discuss real estate inSouth Boston. Id. Slinger knew that Flemmi and Bulger werereputed to be violent criminals. Id. at 88-89.

In early 1987, O'Neil asked Slinger to come to Triple O's, abar that O'Neil owned. Id. at 72. There, in a private room onthe second floor, Slinger was reintroduced to Bulger. Id. at72-73. Bulger told Slinger that he had been hired to kill him,but that Slinger could avoid that fate if he paid Bulger instead.Id. at 73-74. Bulger scornfully rejected Slinger's offer of$2000, saying that his boots cost more than that, and demanded$50,000. Id.

After leaving Triple O's, Slinger called his friend, BostonCity Councilor James Kelly. Id. at 132-37. Slinger told Kellythat Bulger and O'Neil were shaking him down, and gave Kelly thedetails. Id. Kelly indicated that he knew Bulger and O'Neil,and would speak to them. Id. Kelly said that he would try tohelp Slinger. Id. at 75, 127, 132-37. Kelly subsequently toldSlinger that he had spoken to someone, who Slinger understood tobe Bulger or O'Neil, and that Slinger should have no furtherproblems, but if he did, Slinger should call "the authorities."Id.

A week or two later, in March 1987, O'Neil again called Slingerand told him that Bulger wanted to see him at Triple O's. Id.at 75-78, 95, 97. This time Slinger took with him his assistant,Arlene Lehane, and a hidden handgun. Id. At Triple O's, Slingerwas separated from Lehane and again taken to the second floor.Id. There, Bulger, O'Neil, and Kevin Weeks found the handgun,beat Slinger badly, and berated him for talking about theshakedown. Id. Bulger then put Slinger's loaded gun to the topof Slinger's head, said that if he shot him from that angle therewould be no blood shed, and ordered Weeks to get a body bag.Id. Bulger subsequently said, however, that he would giveSlinger another chance to get the $50,0000 quickly. Id. Slingeragreed to do so. Id.

Slinger left with Lehane, who had remained downstairs. Id. at78, 125-26. He was badly swollen and his shirt was ripped. Id.On the ride back to his office, he told Lehane what had happened.Id. at 79.

In March 1987, Slinger borrowed money from his sister and wife,and made an initial $10,000 payment to O'Neil. Id. at 79. Hethen made weekly payments to O'Neil of about $2000 each,amounting to a total of $25,000 by about May 1987. Id. at 79,82, 98. The time for the payments was arranged by telephone andthey were made, in cash, in O'Neil's automobile. Id.

Although he does not now admit it, it appears that in about May1987, Slinger called the FBI. Id. at 82; Newton May 28, 1998Tr. at 64; Ellavsky June 1, 1998 Tr. at 21. See also May 28,1998 Tr. at 13-14 (Lobby, Under Seal). In any event, the squadresponsible for non-traditional organized crime matters, whosesupervisor was Bruce Ellavksy, was informed of the ongoingSlinger extortion. Ellavsky June 1, 1998 Tr. at 17, 21. RodKennedy was assigned to interview Slinger. Id. at 22; NewtonMay 28, 1998 Tr. at 6, 8-9. He asked Newton to accompany him.Id. at 9.

Kennedy and Newton interviewed Slinger at his office in SouthBoston. Slinger Sept. 23, 1998 Tr. at 98. Slinger told Kennedyand Newton exactly what had occurred and about the continuingpayments that he was making. Id. at 98-100. Although Slingerexpressed concern for himself and his family, he said that he waswilling to testify. Newton May 28, 1998 Tr. at 22, 34, 45.

Newton thought that the Slinger matter "looked like a greatcase." Id. at 44-45. His squad had the jurisdiction toinvestigate the "Irish Mob," and Bulger was then viewed as itshighest member. Id. at 54. There was no pending investigationof Bulger and his colleagues. Id. Slinger was the first ofBulger's victims to provide Newton with any information. Id. at54-55. Slinger was not only willing to testify, but would "wear awire" to record incriminating conversations as well. Id. at 55;Ellavsky June 1, 1998 Tr. at 59, 145. In addition, the FBI hadthe opportunity to interview Lehane, to record O'Neil's telephoneconversations with Slinger, and to conduct physicalsurveillances. Ellavsky June, 1, 1998 Tr. at 52. Ordinarily, theUnited States Attorney's Office would have been promptlyconsulted to obtain authority to consensually record Slinger'sconversations. Id. at 46, 48.

Newton, however, knew that Bulger was a Top Echelon informant,who was being handled by Connolly and Morris. Newton May 28, 1998Tr. at 57-58, 61. Newtonunderstood that because Bulger was an informant, supervisorswould have to be consulted and something would "have to be workedout." Id. More specifically, he knew that a high level decisionwould have to be made concerning whether to investigate Bulger.Id. If no effort to develop a case was to be made, Newtonexpected that something would be done to protect Slinger. Id.Newton was right about all of this.

Newton and Kennedy told Ellavsky what Slinger had said. Id.at 36-37; Ellavsky June 1, 1998 Tr. at 29-30. Ellavsky understoodthat Slinger was willing to wear a wire and testify. EllavskyJune 1, 1998 Tr. at 59, 145-46. Ellavsky also knew, however, thatBulger was an FBI informant. Id. at 21-22, 195.

Thus, Ellavsky consulted the ASAC who was then his "boss,"Potts. Id. at 30-31, 141, 192. Following that discussion,several striking things occurred.

Slinger's allegations and willingness to testify provided,under the Attorney General's Guidelines, a quintessential casefor either referring Slinger's allegations to state or local lawenforcement, or reporting the desire not to do so to FBIHeadquarters and the Assistant Attorney General. The Guidelines,however, were utterly ignored. Instead Potts and Ellavskyevidently decided that no further investigation would beconducted. The FBI did not speak with Slinger again. Id. at103. Nor was Lehane ever interviewed by the FBI.

Moreover, contrary to both the requirements set forth in theFBI's Manual and standard the FBI practice, no FBI Form 302 (a"302") or other written record was made of the interview ofSlinger. Newton May 28, 1998 Tr. at 34-36; Kennedy May 28, 1998Tr. at 80; Ellavksy June 1, 1998 Tr. at 26. This dereliction ofduty minimized the risks that Slinger's information would ever beused against Bulger and that those responsible for protecting himwould ever be held accountable for arrogating to themselves thedecision to do so.

As Newton had recognized, however, there was plainly a problempresented by the continuing extortion of Slinger. The FBIapparently decided to deal with that problem in the manner thatit dealt with the National Melotone matter a decade before — bytelling Bulger to "lay off." Slinger testified that in an effortto protect himself, he promptly told O'Neil that he had beenvisited by the FBI. Slinger Sept. 23, 1998 Tr. at 82. If thisoccurred, it would not alone have been enough to deter Bulger,who had for many years been consistently protected by the FBI.Rather, the court infers that Bulger was advised by Connolly todesist. The day after the FBI interview of Slinger, O'Neil toldhim that he would not have to pay the remaining $25,000 that heowed. Id. at 82, 137.

In 1996, Slinger was interviewed by IRS agents who wereinvestigating the Rakes extortion concerning the South BostonLiquor Mart. Id. at 106; May 8, 1998 Government's Ex Parte, InCamera Motion for Protective Order (the "Motion for ProtectiveOrder"). Slinger told them, in detail, about his own experiencewith Bulger. Id. In September 1996, he testified about thismatter before the grand jury, where he was questioned by JamesHerbert and Brian Kelly, two of the prosecutors in this case.Id.

The IRS interview report and Slinger's grand jury transcriptshould have been promptly produced in discovery pursuant to theJune 26, 1997 Order. See United States v. Salemme, 978 F. Supp. 386,387-88 & n. 5 (D.Mass. 1997). That Order stated, in part,that the government was required to produce to counsel for eachdefendant, by July 18, 1997:

c) Any document or record that tends to show that Department of Justice and/or FBI regulations or guidelines were, in any way, not complied with concerning Flemmi and/or Bulger. The documents and records covered by this subparagraph include, but are not limited to, materials indicating that: (i) required records were not prepared or maintained; . . .(iv) established procedures for seeking authorization or guidance concerning the participation of an informant in criminal activity were not followed; and/or (v) any required notification to appropriate authorities of unauthorized criminal activity by Flemmi and/or Bulger was not made.

Id. at 387-88. The court in that Order warned the governmentthat:

If government agents failed to follow required or customary procedures to record accurately communications with informants relevant to this case, the court will consider the possibility of ordering the government, in the discharge of its Brady obligations, to conduct appropriate interviews as part of its "duty to learn of any favorable evidence known to others acting on the government's behalf." Kyles v. Whitley, 514 U.S. 419, 437, 115 S.Ct. 1555, 1567, 131 L.Ed.2d 490 (1995); see also, United States v. Hanna, 55 F.3d 1456, 1460-61 (9th Cir. 1995) (holding that government, as part of its duty under Kyles, was required in particular circumstances to inquire about oral, unrecorded statements between police officers); United States v. Van Nuys, 707 F. Supp. 465, 470 (D.Colo. 1989) (holding that deliberate failure to prepare DEA 6 reports of witness interviews constituted a violation of the duty to preserve evidence that deprived defendant of right to a fair trial).

Id. at n. 5.

Nevertheless, although the government submitted, ex parte,many documents for in camera consideration by the court todecide whether they should be produced to the defendants, theSlinger documents were not disclosed to the court prior to thecommencement of the evidentiary hearings in January 1998. Thegovernment did file a motion for a protective order concerningthem on May 8, 1998. In seeking authorization not to producethem, the government relied in part on the possibility thatproviding the documents to the defendants might endanger Slingerand also in part on the assertion that Slinger's "claim" that hewas "allegedly visited" by two FBI agents could not becorroborated because there was no 302 concerning an interview ofhim and the government had "never been able to identify" theagents who reportedly conducted the interview and "did not knowin fact whether or not they were FBI agents." Motion forProtective Order at 1-2; May 12, 1999 Tr. at 7-8 (Under Seal).

The court held a series of ex parte, in camera conferencesconcerning this matter. See May 12, 1998 Tr. (Under Seal); May13, 1998 Tr. (Under Seal); May 27, 1998 Tr. (Under Seal); May 28,1998 Tr. (Under Seal). The court informed the government that inview of the defendants' constitutional right to certaindiscovery, the IRS report of Slinger's allegations, but not thegrand jury transcript, would have to be disclosed and, ifnecessary and appropriate, steps should be taken to provideSlinger protection. May 12, 1998 Tr. at 10 (Under Seal); May 13,1998 Tr. at 4-5 (Under Seal); May 28, 1998 Tr. at 4-6 (UnderSeal). The defendants were given the IRS report on May 28,1998.44 May 28, 1998 Tr. at 12-13.

The government promptly reiterated its contention that theSlinger matter should not be deemed admissible because thegovernment had not been able to find any 302 indicating that hehad been interviewed, and neither the FBI nor the OPR team thathad conducted an investigation in July 1997 had been able toidentify any FBI agent who interviewed him. Id. at 16-18. Thus,the government questioned whetherthe individuals who visited Slinger "were really FBI agents."Id. at 16. The court expressed skepticism about this argument,based in part on the FBI's handling of the evidence concerningBulger provided by Joseph Runci, which is discussed in § II.24,infra. Id. at 17. Defense counsel suggested that Newton, whowas during the relevant period a member of the squad responsiblefor investigating non-traditional organized crime and was waitingto resume his testimony, be questioned in the lobby about theSlinger matter. Id. at 25-26. The prosecutors and the courtagreed. Id. at 26. It took only three questions by the courtfor Newton to acknowledge that he and Kennedy had interviewedSlinger. Id. at 29.

23. Bulger and Flemmi Are Protected From Investigation In the Hobart Willis Case

The FBI's handling of the Slinger matter was not an aberration.In 1980, Ellavsky joined the squad, known as C-2, which came tohave responsibility for non-traditional organized crimeinvestigations, as well as drug cases. Ellavsky June 1, 1998 Tr.at 17-18, 55. He succeeded Morris as the supervisor of that squadin March 1987, and held the position for several years. Id. at16-17. Although Ellavsky's squad was responsible forinvestigating nontraditional organized crime groups such as theWinter Hill Gang, no investigation of Bulger or Flemmi wasconducted during Ellavsky's tenure on that squad. Id. at 54-55,110-11; Blackburn May 7, 1998 Tr. at 27. Indeed, rather thaninvestigate Bulger and Flemmi, Ellavksy and his colleaguesprotected them from investigation in the Hobart Willis case.

James Blackburn was a member of Ellavsky's squad. Id. at 19;Blackburn May 4, 1998 Tr. at 7. In late 1986 or 1987, Blackburnwas working with the DEA and other law enforcement agencies in ajoint investigation of reputed drug dealer Hobart Willis andothers. Blackburn May 4, 1998 Tr. at 8, 22, 29, 45, May 7, 1998Tr. at 27; Ellavsky June 1, 1998 Tr. at 96. Blackburn receivedinformation that Willis was paying "tribute" to Bulger. BlackburnMay 4, 1998 Tr. at 9, 31, 34.

Blackburn understood that Bulger was an informant for Connolly.Blackburn May 6, 1999 Tr. at 35, 37. Nevertheless, he promptlyspoke to Connolly about the joint investigation of Willisgenerally and about the allegation that he was paying "tribute"to Bulger particularly. Id. at 36-38, May 7, 1998 Tr. at 47-48.Among other things, Blackburn told Connolly that electronicsurveillance of Willis was planned. Blackburn May 4, 1998 Tr. at37. When that electronic surveillance was conducted, Bulger wasnot intercepted. Id. at 37-38.

Connolly told Blackburn that Bulger's practice was to extortmoney from bookmakers, drug dealers, loansharks, and others whocould not complain to the police without incriminatingthemselves. Id. at 18, 43. However, Connolly expressed the viewthat although Willis was a drug dealer in South Boston, Bulgerwas not extorting him. Id. at 17, 39. Following hisconversation with Connolly, Blackburn never pursued anyinvestigation concerning whether Bulger was indeed receivingpayments from Willis. Id. at 45, May 7, 1998 Tr. at 48-49.

The FBI's refusal to investigate Bulger's connection to Willispersisted despite increasingly specific information thatBlackburn and Ellavsky received from their informants. Exs. 102,103, 104, 105. For example, in September 1986, Ellavsky was toldthat "Willis is tired of having to pay Whitey Bulger $2000 permonth to operate his narcotics business in South Boston." Ex.104; Ellavsky June 1, 1998 Tr. at 73-76. In April 1987,Ellavsky's informant reported that Willis was "paying WhiteyBulger and Stevie Flemmi $4000-$6000 per month to operate inSouth Boston." Ex. 105. Blackburn testified, however, that he wasnot given this information for his use in the Willisinvestigation, even after Ellavsky reviewed a July 1, 1988 302from one of Blackburn's informants stating that "Willis continuesto pay Whitey Bulger a "tax" of $1000 to $3000 per month tooperate his cocaine business." Ex. 102; Blackburn May 4, 1998 Tr.at 25, 58, May 6, 1998 Tr. at 7, May 7, 1998 Tr. at 60. The courtquestions Blackburn's claim that Ellavsky did not provide himwith the information from his sources.45

In any event, the 209s reflecting the information that theFBI's sources were providing concerning the extortion of Willisby Bulger and Flemmi were not used by the FBI to investigateBulger or Flemmi; Id. at 14; Ellavsky June 1, 1998 Tr. at101-04; Blackburn May 7, 1998 Tr. at 27. Nor were the 209sindexed in a way that would make them accessible to any FBI agentsearching for source information about Bulger and Flemmi. May 4,1998 Tr. at 60-66. In addition, the information was not sharedwith the other agencies or prosecutors involved in the jointinvestigation of Willis, or used by the FBI in thatinvestigation. Id.; Ellavsky June 1, 1998 Tr. at 97; BlackburnMay 7, 1998 Tr. at 26.

On August 5, 1990, one of Blackburn's sources reported thatWillis expected to be indicted with Bulger within two weeks. Ex.103; Blackburn May 6, 1998 Tr. at 22, 24. Willis and a number ofother drug dealers in South Boston were soon indicted. May 5,1998 Tr. at 183; Blackburn May 4, 1998 Tr. at 95; Ellavsky June1, 1998 Tr. at 86-87. Bulger, however, was not charged.

24. The Guard Rails at the South Boston Liquor Mart

It was not only the Organized Crime squad and the squadresponsible for investigating non-traditional crime that declinedto investigate Bulger and Flemmi in order to perpetuate them asinformants. The Public Corruption squad did so as well.

Joseph Runci was a Boston Globe reporter and photographer,who also served as an FBI informant handled by James Lavin, anagent on the Public Corruption squad. Ex. 144; Runci May 19, 1998Tr. at 43. Runci observed City of Boston workers erecting guardrails on the private property of the South Boston Liquor Mart,which he understood was owned by Bulger, a reputed member oforganized crime. Runci May 19, 1998 Tr. at 53-56. Runciphotographed the workers and their City truck. Ex. 101. Runci May19, 1998 Tr. at 43. In December 1987, Runci told Lavin what hehad seen and provided him the photographs, as well as someadditional documents suggesting that Bulger had bought anotherliquor store through a "straw." Id.; Lavin May 6, 1998 Tr. at22-30.

Lavin recognized Bulger as a well-known member of organizedcrime. Id. at 40. He perceived the potential for a promisingpublic corruption investigation of Bulger and indicated to Runcithat he was very interested in pursuing the matter. Id. at82-87, 85; Runci May 19, 1998 Tr. at 56. Indeed, he told Runcithat he should expect to be called to testify before a grandjury. Runci May 19, 1998 Tr. at 58-59.

Following his usual practice, Lavin reported what he hadlearned and received to his supervisor, John Morris. Lavin May 6,1998 Tr. at 23, 25, 31. Morris told him to "run it by" Connolly.Id. at 32, 58. Lavin understood that he was given thisinstruction because Bulger was rumored to be an informant beinghandled by Connolly. Id. at 34, 39, 86.

Lavin met with Connolly and related to him the informationRunci had furnished. Id. at 36, 62. Connolly confirmed thatBulger was an informant and told Lavin that he had providedvaluable information. Id. This conversation occurred while theelectronic surveillance of Vanessa's was being conducted andConnolly's characterizationof Bulger's contributions was true. Connolly suggested that Lavinnot conduct any investigation. Id. at 76.

Lavin complied with Connolly's suggestion. Contrary to therequirements of the FBI Manual and his uniform practice, Lavindid not prepare a 209 or any other written record of theinformation Runci had provided. Id. at 24, 26-27, 32, 38, 40,63, 80-81. Nor did he conduct any investigation. Id. at 60.Rather, he placed the materials in his desk, where they could notbe discovered or accessed by anyone who might become interestedin investigating Bulger. Id. at 38, 40.

Shortly after Lavin spoke to Connolly, Runci called and toldLavin that the guard rails had been removed. Id. at 43, 62;Runci May 19, 1998 Tr. at 57-58. Lavin inferred that Bulger mayhave been tipped off to the information that the FBI had receivedby Connolly or Morris. Id. at 43-46. The court concludes thatBulger was, once again, told by the FBI of the allegationsconcerning him and of potential for an investigation. Lavin knewthat if this had occurred, it was wrong, and he was concerned.Id. at 46. Thus, Lavin discussed the matter with his colleagueand friend John Michael Callahan. Id. After speaking withCallahan, however, Lavin continued to keep the materials he hadreceived from Runci in his desk. Id.

In 1997, after the claim that the FBI had improperly protectedBulger and Flemmi became public in this case, Callahan remindedLavin of the Runci matter. Id. at 52-54. They agreed that theforegoing information should be provided to the OPR team that wasinvestigating the allegations that had emerged. Id. That wasdone. Id.

25. Joseph Murray

In 1988, Joseph Murray, who was then in federal prison,alleged, among other things, that Connolly and Newton wereselling information to Bulger and Flemmi concerning electronicsurveillance. The FBI assumed responsibility for investigatingMurray's charges. Although Murray was interviewed by agents inthe FBI's Boston office, he was either not asked about his claimthat Connolly and Newton had tipped Bulger and Flemmi off toelectronic surveillance or the information that he provided wasnot included in the 302 of his interview. Nevertheless, theBoston office characterized that charge as "unsubstantiated" andthe administrative inquiry of Connolly and Newton was quicklyterminated. The evidence presented in the instant case, however,demonstrates that Murray's claim was correct.

More particularly, beginning in January 1988, Weld's secretaryat the Department of Justice received a series of increasinglyspecific telephone calls from an individual, who asked that theinformation being provided not be passed on to Boston authoritiesbecause of the people involved. Ex. 148; Weld May 26, 1998 Tr. at78-115. The caller initially claimed that Connolly and BostonPolice Deputy Ed Walsh "sell information to Whitey Bulger andStevie Flemmi — and that's how they find wiretaps." Ex. 147. Seealso Ex. 148. The source later alleged that Newton was "anotheragent besides John Connolly who fed Bulger, Flemmi, Nee and Weeksinformation." Ex. 160.

Weld took these allegations seriously. Weld May 26, 1998 Tr. at93. Based on his knowledge and experience in Boston, he feltthere might be a "weak link" between Connolly and Bulger. Id.at 94. Initially, he referred the matter to his Deputy, JackKeeney, with a note saying "I know all this. So this [source] ison the up and up." Id. at 92; Ex. 147.

The source also claimed to have information that Bulger and PatNee had murdered Halloran and Bucky Barrett. Exs. 149, 150. Thesource subsequently said that there was an eyewitness to theHalloran shooting who might come forward, and elaborated that:"there is a person named John, who claims he talked to Whitey andNee as they sat in the car waiting forHalloran on Northern Avenue. He sits in a bar and talks about it.He saw the whole operation." Exs. 149, 152. The source added thatthe person providing the information to the source "will bewilling to talk to you (authorities) soon." Ex. 152. On February3, 1988, Weld directed Keeney to have the information that he hadreceived sent to the United States Attorney in Boston, FrankMcNamara, and to the Strike Force Chief, O'Sullivan. Ex. 151.Weld added that: "Both O'Sullivan and [Assistant United StatesAttorney] Bob Mueller are well aware of the history, and theinformation sounds good." Id.

At some point, it was determined that the ultimate source ofthe information being communicated to Weld was Joseph Murray, whowas then in federal prison. Ex. 156. His allegations werereferred to the Boston office of the FBI. Ex. 156; Clark June 3,1998 Tr. at 28. These allegations included the claim that "FBIAgents John Connolly, Jr. and John Newton were sellinginformation regarding wiretaps, to Whitey Bulger and StevieFlemmi." Ex. 156.

Dennis O'Callahan, the ASAC who had succeeded Potts, wascharged with directing an administrative inquiry of Murray'sclaims concerning Connolly and Newton. Clark June 13, 1998 Tr. at106, 116. In June 1989, O'Callahan assigned Edward Clark, thesupervisor of the Bank Robbery squad, to interview Murray. Id.at 29. Edward Quinn, a member of the Organized Crime squad whohad then worked with Connolly for thirteen years andcharacterized Connolly as a "close friend," accompanied Clark towitness the interview. Id. at 39; Quinn Aug. 19, 1998 Tr. at13-14.

Clark and Quinn were briefed and given the documents reflectingthe information that Weld had received. Id. at 29-31. Clarktestified that they were instructed to focus on the allegationsof misconduct against Connolly and Newton in their interview ofMurray. Id. at 31, 61-62.

Clark and Quinn spoke to Murray at the Strike Force's office inthe federal courthouse in Boston, on June 14, 1989 — more than ayear and a half after the initial call to Weld. Ex. 156. Murraywas fully cooperative. Clark reported that:

Murray was asked if he would furnish information regarding the above matters and what he wanted as a quid pro quo. Murray said that Whitey Bulger and Stevie Flemmi have a machine and that the Boston Police and the FBI have a machine and he cannot survive against those machines. He is willing to furnish information and wants nothing in return. The information he furnished now will help save the life of a friend or a loved one in the future.

Id.

Clark and Quinn each knew that Bulger and Flemmi wereinformants handled by Connolly. Id. at 85-86; Quinn Aug. 19,1998 Tr. at 19. Although the purported primary purpose of theinterview was to explore Murray's claim that Bulger and Flemmiwere paying Connolly and Newton for information concerningelectronic surveillance, there is no reference to this allegationin either the notes Clark made at the interview or in the 302that he later prepared. Exs. 151, 158; Clark June 3, 1998 Tr. at89. The court concludes that either Murray was not asked abouthis allegations concerning Connolly and Newton or that theinformation that he provided concerning them was not recorded.Similarly, although Murray reiterated that Bulger and Nee hadmurdered Halloran, neither Clark nor Quinn asked him about theindividual named "John" who Murray had previously assertedwitnessed the killing. Exs. 151, 158; Clark June 3, 1998 Tr. at80, 114-15.

Clark discussed the interview with O'Callahan and gave him the302, which included information linking Bulger and Flemmi to theHalloran and Barrett murders. Ex. 156; Clark June 3, 1998 Tr. at65. Clark was not asked to do anything further. Id. at 64.

Two months later, however, O'Callahan prepared a memorandumfrom the SAC, Ahearn, to the Director of the FBI, reporting thatMurray had been interviewed and that, "[T]he allegations that SSAConnolly and SA Newton are disclosing information regardinginvestigations being conducted by this Division to criminalelements are unsubstantiated by specific facts . . ." Ex. 157.The administrative inquiry was then terminated in Boston and,evidently, the matter was not pursued by FBI Headquarters, theUnited States Attorney's Office, the Strike Force or theDepartment of Justice, which Weld had left in March 1988. WeldMay 26, 1998 Tr. at 5.

Moreover, although Clark viewed it as significant, theinformation that Murray provided implicating Bulger and Flemmi inthe Halloran and Barrett murders was not provided to any agentsresponsible for investigating those matters or indexed so that itcould be accessed by such agents. Clark June 3, 1998 Tr. at66-67, 116-18. Similarly, while Clark felt Murray would make a"terrific" informant, there is no evidence that any effort wasmade to utilize him as a source despite his demonstratedwillingness to provide information. Id. at 118-23. Accordingly,Murray was effectively eliminated as a threat to the symbioticrelationship between the FBI and Bulger and Flemmi.

26. John Bahorian

Prior to Ring becoming the Supervisor of the Organized Crimesquad in 1983, two agents on that squad, Robert Jordan andStanley Moody, became involved in an investigation of payoffs tomembers of the Boston Police Department. Ring Sept. 18, 1998 Tr.at 131. The investigation continued after Ring became supervisor.In the course of that investigation, Jordan and Moody obtainedthe cooperation of a Boston Police Lieutenant, James Cox. Afterconsultation with O'Sullivan, it was decided to have Cox attemptto record conversations with Flemmi and Bulger, among others.Ring June 15, 1998 Tr. at 6-12, June 19, 1998 Tr. at 118, 129-30,155-57.

Flemmi claims that Ring told Bulger that Cox would be wearing awire and approaching him. Flemmi Aug. 20, 1998 Tr. at 70, Aug.28, 1998 Tr. at 103-04. Bulger passed this information on toFlemmi. Id. Ring denies that he tipped off Bulger and Flemmi toCox's cooperation. Ring Sept. 3, 1998 Tr. at 134. The court findsthis denial credible.

It is true, however, that Flemmi was forewarned about Cox. Ex.30, ¶ 11; Flemmi Aug. 20, 1998 Tr. at 70-73. Connolly had askedMorris, and perhaps others, whether Cox was "wired." Morris Apr.21, 1998 Tr. at 36-37, Apr. 23, 1998 Tr. at 80. The court infersthat Connolly is the person who told Bulger and Flemmi that Coxwas cooperating with the FBI.

About a week later, on September 5, 1988, Cox approached Flemmiand they spoke briefly. Morris Apr. 23, 1998 Tr. at 64; Ring June15, 1998 Tr. at 6-12; Flemmi Aug. 20, 1998 Tr. at 70. Flemmi wascircumspect and said nothing suspicious or incriminating.Connolly subsequently told Flemmi that the FBI had listened tothe tape and considered it "unproductive." Id. at 73-75, Aug.28, 1998 Tr. at 111.

Flemmi's informant file includes an insert stating that onOctober 29, 1986, Flemmi told Connolly that "the word around theBoston Police is that a cop by the name of Cox is wired up onother cops." Ex. 229. Flemmi did not, however, provide thisinformation to Connolly. Flemmi Aug. 20, 1998 Tr. at 71-72, Aug.28, 1998 Tr. at 105-09. Rather, the court concludes that thisinsert is another document containing false information in aneffort to make it more difficult to discern and demonstrateimproper conduct by Connolly.

Soon after the encounter between Cox and Flemmi, Jordan, Moody,and their investigation were transferred to the White CollarCrime squad in an effort to distribute the "good investigations"more equally.Ring June 15, 1998 Tr. at 12, June 19, 1998 Tr. at 157-58, Sept.18, 1998 Tr. at 132; Morris Apr. 23, 1998 Tr. at 62, Apr. 29,1998 Tr. at 73-74. Morris was then the supervisor of the WhiteCollar Crime squad. Morris Apr. 22, 1998 Tr. at 97-101.

As the investigation evolved, it came to focus on JohnBahorian, a bookmaker believed to be making payments to Flemmi.Morris Apr. 22, 1998 Tr. at 101, Apr. 29, 1998 Tr. at 69-70. Inthe spring of 1988, Moody and Jordan were preparing anapplication for electronic surveillance of Bahorian, whichtargeted Flemmi as well. Morris Apr. 22, 1998 Tr. at 101-02.

Morris was afraid that the electronic surveillance would leadto Flemmi's arrest and indictment. Morris Apr. 29, 1998 Tr. at68, 70. Morris was concerned that if that occurred, the nature ofhis relationship with Bulger and Flemmi would be revealed. Id.Thus, Morris asked Connolly to tell Flemmi and Bulger to stayaway from Bahorian. Id. at 67, Apr. 22, 1998 Tr. at 120-21.Morris also asked Connolly to tell Bulger and Flemmi not to doanything to Bahorian because Morris "did not want anotherHalloran." Morris Apr. 22, 1998 Tr. at 121-22. Morris believedthat Bulger and Flemmi had been involved in the Halloran murder.Id. His directions to Connolly in 1988 were both a reminder andperformance of his 1985 promise that Bulger and Flemmi would beprotected as long as they did not murder anyone. Id.

Connolly delivered Morris' message to Bulger and Flemmi. Id.He later reported to Morris that they wanted to meet with him todiscuss the Bahorian matter. Id. at 103, 121.

Thus, in the spring of 1988, prior to the inception of theelectronic surveillance of Bahorian, Bulger, Flemmi, and Connollymet with Morris at his home. Id. at 103, 105, 109, 121; FlemmiAug. 20, 1998 Tr. at 76, Aug. 28, 1998 Tr. at 115. Morris toldBulger and Flemmi about the planned electronic surveillance andwarned them to stay away from Bahorian. Id. at 103-04. Morrisalso said that he could keep Flemmi out of any indictment arisingout of the Bahorian electronic surveillance. Flemmi Aug. 20, 1998Tr. at 78.

As in the past, neither Bulger nor Flemmi claimed that he hadimmunity and could not properly be investigated or prosecuted.Nor did Morris believe that they were immune from prosecution.Rather, Morris felt that by warning Bulger and Flemmi he wasengaging in an illegal obstruction of justice. Id. at 104, Apr.30, 1998 Tr. at 102.

Bahorian's telephone was wiretapped from June 22 to September25, 1988. Apr. 29, 1998 Tr. at 113. Flemmi was named as a targetin the application for that electronic surveillance. Morris Apr.22, 1998 Tr. at 102. The wiretap produced evidence that led tothe indictment of Bahorian and others. Id. at 101-02, 109.Because he was warned, however, Flemmi was neither interceptednor charged. Id.

27. The Leak and the Threat to The Boston Globe

After telling Flemmi and Bulger about the imminent Bahorianwiretap, Morris was "very upset." Morris Apr. 29, 1998 Tr. at123. He felt "completely compromised" and vulnerable. Id. at67. As described earlier, Morris was afraid that if Flemmi orBulger were prosecuted, the nature of his relationship with themwould be revealed. Id. at 68, 70. Morris decided that he was"going to do whatever [he] could to stop Bulger and Flemmi shortof admitting [his] crimes." Id. at 125.

Morris had previously told Ring that Bulger had "outlived [his]usefulness," but he had not been closed as an informant. MorrisApr. 29, 1999 Tr. at 66, Apr. 30, 1999 Tr. at 91. Now Morriswanted to "destroy the relationship between the FBI and [Bulgerand Flemmi]" himself. Morris Apr. 29, 1998 Tr. at 124. Thus,Morris took an extraordinary step calculated to terminate thethreat that Bulger and Flemmi presented to him in a manner thatminimized the risk that his role in doing sowould be exposed. In essence, he attempted to provoke "anotherHalloran."

More specifically, in about June 1988, Morris spoke to GerardO'Neill, a reporter for The Boston Globe's investigative unit,the "Spotlight Team." Ex. 85; Morris Apr. 28, 1998 Tr. at 74-76.Morris understood that as a responsible journalist, O'Neill wouldprotect the confidentiality of Morris as his source. Morris toldO'Neill that Bulger was an FBI informant. Morris Apr. 27, 1998Tr. at 154-57, Apr. 28, 1998 Tr. at 31, 74-75, Apr. 29, 1998 Tr.at 74-75, 80-81. Morris also indicated that Flemmi was an FBIinformant. Morris Apr. 28, 1998 Tr. at 74-75. Morris did not saythat the conversation was "off the record" and understood thatThe Boston Globe would likely publish at least that Bulger wasan FBI informant. Morris Apr. 29, 1998 Tr. at 78, 80-81.

Morris was well aware that an article reporting that Bulger wasan informant could cause him to be killed by the LCN, amongothers. Morris Apr. 28, 1998 Tr. at 77-78. More specifically, asMorris later put in an affidavit in which he falsely swore underoath that he had not deliberately told O'Neill that Bulger was aninformant:

[T]he consequences of individuals being identified as informants, regardless of the accuracy of the information, could be serious. . . . a human life [is] a human life, be that person criminal, informant, or both. . . . the criminal element would not need proof or documentation to take action, so, such statements as inferences could be deadly.

Ex. 85; Morris Apr. 28, 1998 Tr. at 76-77, Apr. 30, 1998 Tr. at93.

Morris also knew that public disclosure that Bulger was aninformant could be fatal to Flemmi. As Morris testifiedconcerning the possible closure by the FBI of Bulger as aninformant, it "would have been the end of Flemmi too . . .[b]ecause they were so closely tied together." Morris Apr. 28,1998 Tr. at 79.

Morris' call prompted The Boston Globe Spotlight Team to planto write a series of articles that would address, among otherthings, the events and information indicating that Bulger was asource for the FBI, who was being protected from investigationand prosecution. Among the matters of interest to the SpotlightTeam were the race-fix case in which Bulger was not indicted, theLancaster Street Garage investigation, and the 1984-85investigation led by the DEA. As part of its research, a memberof the Spotlight Team, Richard Lehr, directed a letter to Ciulla,the "star witness" in the race-fix case, who was then beingprotected by the government. Cullen Oct. 15, 1998 Tr. at 38, 47.

On July 19, 1988, Daly, who was the lead FBI agent on therace-fix case, called Kevin Cullen, another member of theSpotlight Team. Id. at 131. Daly and Cullen had talked severaltimes before, but were not friends. Id. at 44-45. Dalyindicated that he knew about the letter to Ciulla and expressedregret that Cullen had not called him first. Id. at 47.

Cullen told Daly that the Spotlight Team was preparing anarticle that would report that Bulger was an FBI source and, as aresult, had been protected by the FBI in the race-fix case, amongothers. Id. at 133-55, 159. Daly denied that Bulger was aninformant. Id. at 104-07, 133-35. He also denied that Bulgerwas protected from prosecution in the race-fix case because hewas an FBI source. Id. at 50-51. As described previously, bothof these assertions were false.

Daly proceeded to tell Cullen that as Ciulla had purportedlytold Daly, Bulger was a very dangerous man who would thinknothing of "clipping" anyone who wrote the sort of story Cullendescribed. Id. at 48, 50, 160; Ex. 242. Daly emphasized that,in his opinion, Cullen was especially vulnerable because it waswell-known that he lived in South Boston. Cullen Oct. 15, 1998Tr. at 50, 164.

Cullen believed that Bulger was a violent person and, indeed, akiller. Id. at 65-67. Cullen also believed that Daly's commentsconstituted a threat intended to discourage The Boston Globefrom publishing the story it was planning. Id. at 52, 74, 75,138-39, 146-47; Ex. 242. Cullen was correct. Daly made no writtenrecord of his call to Cullen, as he would have if it had beenintended as an official warning by the FBI to a potential victimof violence. Cullen Oct. 15, 1998 Tr. at 178.46

The SAC, Ahearn, subsequently spoke on the record to theSpotlight Team, which reported that:

James F. Ahearn, special agent in charge of the FBI in Boston, was unequivocal when asked last month if Bulger had relations with the FBI that have left him free of its scrutiny.

"That is absolutely untrue," said Ahearn. "We have not developed anything of an evidentiary nature that would warrant it and, if we ever do develop anything of an evidentiary nature, we will pursue it. We specifically deny that there has been any special treatment of this individual."

Ex. 243. Whether he knew it or not, Ahearn's statement wasutterly incorrect.

In any event, Cullen discussed Daly's call with his colleagues.Cullen Oct. 15, 1998 Tr. at 52-53, 119. They too interpretedDaly's comments as a threat intended to intimidate them frompublishing the series of articles that they were planning. Id.;Morris Apr. 30, 1998 Tr. at 178. Nevertheless, the reporters andThe Boston Globe were undeterred.

The Boston Globe did, however, take the threat to Cullenseriously. Prior to publication of the article concerning Bulger,the newspaper paid to have Cullen and his wife relocated. Id.at 57-58, 123. Although still uneasy, after about a week Cullenreturned to his home in South Boston. Id. at 123.

On September 20, 1988, The Boston Globe published its articleon Whitey Bulger. Id. at 131; Ex. 243. The article reportedthat the FBI had "for years had a special relationship withBulger" and reviewed the events suggesting that the FBI wasprotecting him, including the race-fix case, the Lancaster StreetGarage investigation, and the investigation led by the DEA in1984-85. Id.

At Ahearn's request, the FBI conducted an administrativeinquiry focusing primarily on whether Morris had leaked the factthat Bulger was an informant and other confidential informationto The Boston Globe.47 Ex. 134. Morris repeatedly liedunder oath during the course of that investigation by suggestingthat he may have, at most, perhaps inadvertently confirmed thatBulger was a source. Morris Apr. 28, 1998 Tr. at 64-73, Apr. 30,1998 Tr. at 93; Exs. 84, 85. Morris refused to take a polygraphtest. Ex. 84. His deception succeeded. Morris emerged from theinvestigation with a censure and fourteen days of unpaid leave.Morris Apr. 28, 1998 Tr. at 72. These sanctions did not preventMorris from progressing through the hierarchy of the FBI until1995, when he became Chief of the Training and AdministrativeSection at the FBI Academy in Quantico, Virginia.

28. Flemmi and Salemme

The Boston Globe article was upsetting to Bulger and Flemmi,who felt betrayed and endangered. Flemmi Aug. 21, 1998 Tr. at96-99; Ex. 159. On or about October 6, 1988, several weeks afterthe article was published, they met with Connolly and Morris, whowas still the alternate agent for handling Flemmi. Ex. 42; FlemmiAug. 20, 1998 Tr. at 78, Aug. 28, 1998 Tr. at 115-19. This wasthe last meeting or discussion that Flemmi had with Morris.Flemmi Aug. 21, 1998 Tr. at 86, 103, Aug. 28, 1998 Tr. at 115-16.

Connolly told Bulger and Flemmi that because of the articles,others in the FBI wanted to distance themselves from them. FlemmiAug. 21, 1998 Tr. at 78-79, Aug. 28, 1998 Tr. at 116-18. Flemmisensed that Connolly might be under some pressure to terminatetheir relationship. Flemmi Aug. 28, 1998 Tr. at 118. Connolly,however, disagreed and urged Bulger and Flemmi to "hang in."Flemmi Aug. 20, 1998 Tr. at 97, Aug. 28, 1998 Tr. at 116-18.

Among other things, Connolly said he was very concerned aboutSalemme, who had completed his sentence for the Fitzgeraldbombing and been released from prison in the past year. FlemmiAug. 20, 1998 Tr. at 97; Ex. 237 (209 dated 1/24/98). Salemme hadreestablished contact with Flemmi. Ex. 237 (209 dated 1/24/98).Connolly had asked Flemmi to report to him on Salemme's activityand Flemmi had been doing so. Flemmi Aug. 20, 1998 Tr. at 98; Ex.237 (209s dated 1/24/88 and 7/15/88). Ultimately, after Bulgerhad spoken again to Connolly, he and Flemmi agreed to followConnolly's advice and continue their alliance. Flemmi Aug. 21,1998 Tr. at 102-03, Aug. 28, 1998 Tr. at 116-18.

Subsequently, Bulger told Flemmi that he suspected Morris wasthe source of the leaks to The Boston Globe. Flemmi Aug. 21,1998 Tr. at 93-94. In view of their relationship, it is likelythat Bulger was echoing views expressed by Connolly while the FBIwas focusing unsuccessfully on Morris as the source of thoseleaks.

The Boston Globe article contributed to Bulger and Flemmi'sdecision to withdraw from some of their most obvious criminalactivity in an effort to insulate themselves from effectiveinvestigation and prosecution. As Mercurio described it when hebecame an informant, Bulger and Flemmi were "backing away fromillegal activity" in part because "they had more than adequate .. . legitimate businesses," including real estate, that they mayhave acquired illegally. Mercurio Aug. 5, 1998 Tr. at 116-17,121-22; Exs. KKK, LLL. In this sense, the timing of The BostonGlobe article was fortuitous. In 1988 and 1989, without theknowledge of the FBI in Boston, the DEA conducted anotherinvestigation involving electronic surveillance, targeting Bulgerand Flemmi, which led to many indictments, but no charges againstthe FBI's prize sources. Ex. 126; Blackburn May 7, 1999 Tr. at41.

Flemmi continued to provide Connolly with the information thatthe FBI wanted concerning the LCN generally and Salemmeparticularly. Flemmi had previously told Connolly that Salemmewas "extremely paranoid" about the Boston faction of the LCN andthat he had allied himself with Patriarca, who viewed Salemme asa valuable, direct link to Flemmi and the Winter Hill Gang. Ex.237 (209 dated 7/15/88). Flemmi subsequently reported thatSalemme was frequently meeting with Patriarca and also that hewas holding meetings at the Busy Bee restaurant, which thegovernment later obtained a warrant to bug. Exs. 36 (209 dated4/11/90), 237 (209s dated 3/7/99 and 3/20/99); Flemmi Aug. 20,1998 Tr. at 100-01.

Importantly, Flemmi kept Connolly informed of the risingtension between Salemme and the Boston faction of the LCN. Mostnotably, on June 6, 1989, Flemmi reported that, with Patriarca's"blessing," Salemme was "moving all over the city to consolidatehis power in anticipation ofimminent federal indictments which will cripple the North End`Outfit' people, allowing Salemme to step into the vacuum left bytheir arrests." Ex. 37 (209 dated 6/6/89). Flemmi explained thatRusso, Ferrara, Carrozza, Mercurio, and others in the Bostonfaction of the LCN were furious with Salemme and might kill himif they had time to do so before their anticipated indictments.Id. As discussed in § II.29, infra, ten days later, on June16, 1989, Salemme was shot, but not killed, and William Grasso,another Patriarca ally, was murdered in Connecticut. June 5, 1998Tr. at 5. As also discussed, in § II.29, infra, the FBIunderstood that Salemme had been set up by Mercurio, who, withFlemmi and Bulger's assistance, Connolly had recruited as a TopEchelon informant. Id. at 5-6; Flemmi Aug. 20, 1998 Tr. at136-37; Ring June 15, 1998 Tr. at 18-21.

Connolly appreciated the important information that Flemmi wasfurnishing and continued to provide Bulger and Flemmi with theprotection that he had promised. For example, in 1988 or 1989Connolly told Bulger that Timothy Connolly, who is alleged tohave been a victim of extortion in the instant case, wascooperating with the FBI and would attempt to recordconversations with Bulger and Flemmi. Ex. 30, ¶ 11; Flemmi Aug.20, 1998 Tr. at 139-45, Aug. 28, 1998 Tr. at 113; 4SI, RA 56.Bulger shared this warning with Flemmi. Ex. 30, ¶ 11; Flemmi Aug.20, 1998 Tr. at 139-45, Aug. 28, 1998 Tr. at 113.

29. Mercurio as an Informant

In the late 1980's, Flemmi not only continued to provide theFBI with valuable information that he had obtained concerning theLCN. He and Bulger also assisted in recruiting Mercurio, a mademember of the LCN, as a Top Echelon informant.

Mercurio had been released from prison in 1986. Mercurio Aug.4, 1998 Tr. at 73. As he explained in one of his earliestencounters with Connolly, Mercurio was then "disenchanted withthe mafia because no one in the mafia did anything for him whilehe was away." Exs. 113, 181. Mercurio reported that, in contrast,he "remain[ed] close to James "Whitey" Bulger and Stevie Flemmiwho sent his girlfriend $100 a week while he was in the `can.'"Id. See also Flemmi Sept. 1, 1998 Tr. at 52-53.

As described previously, Mercurio knew that Vanessa's had beenbugged. Mercurio Aug. 5, 1998 Tr. at 61; June 5, 1998 Tr. at 5(Under Seal). He also knew that the Sagansky-Weinstein extortionhad been intercepted and that he would be prosecuted. Id. at65; Ex. 165. Bulger reported this to Connolly and advised that"Mercurio [would] go on the `lam' before he goes to prisonagain." Ex. 165; Flemmi Sept. 1, 1998 Tr. at 50-52; Ring June 8,1998 Tr. at 103. This was indeed Mercurio's plan. Mercurio Aug.5, 1998 Tr. at 123-24.

Ring and Connolly decided to try to exploit Mercurio'sdiscontent with the LCN and fear of returning to prison torecruit him as an informant. Ring June 15, 1998 Tr. at 18-21.Connolly consulted Flemmi and Bulger to develop a "profile" ofMercurio that he could employ in this effort. Flemmi Aug. 20,1998 Tr. at 137-38. Flemmi and Bulger proved to be veryknowledgeable about Mercurio. Ring June 19, 1998 Tr. at 140.

Armed with the information Bulger and Flemmi provided, and asdirected by Ring, Connolly approached Mercurio. Ex. 200; RingJune 15, 1998 Tr. at 18. In about October 1987, Mercurio beganproviding information to the FBI and was soon opened as aninformant. Ex. 200; Ring June 8, 1998 Tr. at 24-25; June 6, 1998Tr. at 5-6 (Under Seal). Connolly told Bulger and Flemmi that hehad developed Mercurio as an informant. Flemmi Aug. 20, 1998 Tr.at 137-38.

Mercurio testified that he never had any conversations withConnolly or Ring concerning what he would receive in return forhis cooperation. Mercurio Aug. 5, 1998 Tr. at 23. Mercuriocontends that he became an informant after Connolly threatenedto tell Ferrara and Russo that Mercurio had revealed that theyhad a source in law enforcement who tipped them off to the searchof Vanessa's. Id. at 113-14, 120. Mercurio's testimony on thisissue, among others, is not credible. Rather, the court infersthat in the process of recruiting him, the FBI indicated toMercurio that he would be alerted when he was about to beindicted so that he could flee. As discussed, in § II.30,infra, this promise was honored.

Mercurio was upgraded to a Top Echelon informant in May 1988.Ring June 9, 1998 Tr. at 99, June 15 Tr. at 22, 31. He was thenon parole until 1993. Id.; Ex. 234. One of the conditions ofhis parole was that he not serve as an informant for any lawenforcement agency. Ring June 15, 1998 Tr. at 23. In addition,there was a threat that the publicized search of Vanessa's wouldprompt the Parole Commission to revoke Mercurio's release andthat he would, therefore, be lost to the FBI as a Top Echeloninformant. Id. at 44; Ex. 235.

Mercurio testified that he never discussed the issue of theearly termination of his parole with the FBI. Mercurio Aug. 5,1998 Tr. at 27-28. This assertion is not correct. Although he mayhave initially been reluctant to have his cooperation disclosed,he ultimately told Connolly that he wanted the FBI to seek theearly termination of his parole. Ring June 15, 1998 Tr. at 33,46; Ex. 234. Ring and Mercurio also discussed this issue. RingJune 15, 1998 Tr. at 25, 34, 46. Ring explained to Mercurio thatthe request for early termination of his parole would involvegenerating documents describing his status and value as aninformant, which would be maintained outside of the FBI. Id. at33-35. Nevertheless, Mercurio told Ring that he wanted therequest made. Id.; Ex. 200. Accordingly, Mercurio authorizedRing to discuss the dilemma posed by his parole status withO'Sullivan, and to have the FBI and Department of Justice ask theParole Commission to terminate his parole early. Ring June 15,1998 Tr. at 33-55, 44-55.

O'Sullivan sent a letter dated October 31, 1998 to BenjaminBaer, the Chairman of the Parole Commission, requesting thatMercurio's petition for early termination of his parole beallowed because of "the extremely valuable services that Mr.Mercurio [had] rendered to the Federal Bureau of Investigation."Ex. 182. The letter was based on information that O'Sullivan hadreceived from Connolly. Ring June 15, 1998 Tr. at 32. In supportof his request O'Sullivan wrote:

It is the very strong desire of the Federal Bureau of Investigation that Mr. Mercurio be rewarded with early termination of his parole because of the extremely valuable information that Mr. Mercurio has provided and continues to provide to the F.B.I. concerning the activities of the leadership element of La Cosa Nostra in the Boston area. Information provided by Mr. Mercurio has allowed the F.B.I. to identify newly made members of the Patriarca L.C.N. Family, as well as learning about the restructured leadership of the Family. Even more importantly, the information provided by Mr. Mercurio has been used in affidavits in support of court authorized electronic surveillance directed at the L.C.N. Information gathered in this electronic surveillance is the basis upon which a R.I.C.O. indictment will soon be returned in the District of Massachusetts against the restructured leadership of the Patriarca Family.

Because of the extremely sensitive nature of the information contained in this letter, I request that this letter be maintained by you in a secure file and receive only the most limited circulation. If you have any questions of me, please feel free to contact me.

Thank you for your personal attention to this matter. Ex. 182.The claim that Mercurio had provided information used to supportapplications for electronic surveillance is, as far as Ringknows, not true.Ring June 15, 1998 Tr. at 33. In any event, in about February1989, Diane Kottmyer, who was about to succeed O'Sullivan as thehead of the Strike Force, was told of Mercurio's status as an FBIinformant and of O'Sullivan's letter to the Parole Commission.Kottmyer Aug. 13, 1998 Tr. at 83-88.

O'Sullivan's letter alone was not sufficient to persuade Baerthat Mercurio's parole should be terminated. Exs. 234, 235.Rather, Baer requested that the FBI provide a letter supportingO'Sullivan's request. Id.

Accordingly, on December 6, 1988, Ring sent to FBI Headquartersa memorandum and draft letter, for signature by AssistantDirector Floyd Clarke, endorsing the request that Mercurio'sparole be terminated. Ex. 234. On January 5, 1989, an addendum tothose documents was prepared by Dennis Maduro, who worked in theOrganized Crime Section of FBI Headquarters, evidently afterspeaking to Ring or Connolly. Ex. 234; Summerford Sept. 15, 1998Tr. at 102-05. The addendum stated in part that:

Mercurio will be indicted along with other Patriarca La Cosa Nostra Family members in the near future. Early termination of Mercurio's parole will ensure that at the time of his arraignment, Mercurio is afforded bail and not otherwise remanded to the federal Metropolitan Correction Center which would jeopardize his physical safety.

Ex. 234 (emphasis added).

The materials, including the addendum, were forwarded to JamesSummerford, who was the Chief of the FBI's Informant Unit.Summerford Sept. 15, 1998 Tr. at 100, 125. Summerford discussedthe materials by telephone with Ring on January 6, 1989. Id. at105-13; Ex. 234. In response to issues raised by Summerford, Ringexplained that Mercurio would only be charged with crimescommitted before he became an informant. Ex. 234; SummerfordSept. 15, 1998 Tr. at 110-13, 119. This issue was importantbecause if it were contemplated that Mercurio might be chargedwith crimes committed while he was serving as an FBI source, asubstantial question would be presented concerning whether hecould be continued as an informant. Summerford Sept. 15, 1998 Tr.at 111-13. In such circumstances, the FBI in Boston, the StrikeForce, the Organized Crime Section of FBI Headquarters, theOrganized Crime Section of the Department of Justice, and theParole Commission would all have had to participate in decidingwhether sustaining Mercurio as an informant was appropriate.Id.

Ring also told Summerford that when Mercurio was indicted,"[h]is cooperation would be made known to the court." Id. at113, 119; Ex. 234. In addition, after speaking with Ring,Summerford understood that one reason that the FBI in Boston wasrequesting the early termination of Mercurio's parole was toensure that when he was arrested, he would be released on bail.Summerford Sept. 15, 1998 Tr. at 117-24.

Following his conversation with Ring, Summerford prepared amemorandum to the Criminal Division of the Department of Justiceand a letter to Baer, each of which were sent by Clarke insupport of the request for the early termination of Mercurio'sparole. Id.; Ex. 235. The memorandum stated, in part, that:

Mr. Mercurio will be indicted in the near future for extortion and conspiracy to commit extortion in connection with gambling activities involving the New England Region La Cosa Nostra (LCN). These criminal acts were perpetrated prior to his current cooperation with the FBI. His past criminal activities have given him direct access to individuals who are responsible for policy making at the highest levels of the LCN in New England. The FBI believes that Mr. Mercurio will continue to cooperate and provide invaluable information that will have significant impact in countering LCN activity in New England and that the benefits of his continued cooperation far outweighs any drawbacks that can be foreseen or reasonably anticipated. The FBI will make a factual presentation to the sentencing judge concerning his cooperation to date. Early termination of Mr. Mercurio's parole will help ensure that he is not sent to jail for violating his parole where his safety could be in danger. Approval of this request will also mean his continued freedom which will enable him to continue to work for the FBI.

Ex. 235 (emphasis added).

Both Ring and Mercurio persuasively deny that there was everany discussion with Mercurio about bringing his cooperation tothe attention of a judge. Ring June 19, 1998 Tr. at 161-62;Mercurio Aug. 5, 1998 Tr. at 27; Kottmyer Aug. 13, 1998 Tr. at85. The FBI in Boston did not expect that Mercurio's cooperationwould ever be disclosed and, therefore, there would not have beenany foreseeable risk to him if he were detained pending trial.

The claim of such a risk was, however, used as a reason to tryto assure that when indicted and arrested, Mercurio would bereleased on bail. Ex. 234; Summerford Sept. 15, 1998 Tr. at117-24. Kottmyer testified that she was never told that the FBIdid not want Mercurio detained after he was indicted. KottmyerAug. 13, 1998 Tr. at 86-88. However, on September 1, 1989, shewrote to her superior in Washington that O'Sullivan had writtento the Parole Commission to do something for Mercurio as an actof good faith, to avoid parole revocation, and to decrease thelikelihood of pretrial detention when Mercurio was indicted. June15, 1998 Tr. at 18-19 (Under Seal).

With Clarke's letter, the effort to secure the earlytermination of Mercurio's parole succeeded. His parole wasterminated in about February 1989. Mercurio Aug. 4, 1998 Tr. at158-61.

On February 10, 1989, about the time that his parole wasterminated, Mercurio told Connolly that he, Ferrara, Carrozza,and Lepore planned to "take off" before being indicted. Ex. 166.Ring reviewed the 209 that included this information. Ring June8, 1998 Tr. at 104. Mercurio's report of his intention to fleeconfirmed the information that Bulger had provided in September1987. Ex. 165.

The inserts in Mercurio's informant file indicate that in early1989 he was frequently furnishing information to Connolly,including reports on information that was being provided byAnthony Cardinale, Ferrara's attorney. See, e.g., 209s dated1/25/89 and 2/14/89.48 When she became Chief of the StrikeForce in February 1989, Kottmyer expressed to the FBI concernabout the possibility that Mercurio would report on defensestrategy, and about other issues, including whether Mercuriomight assert an authorization defense. Kottmyer Aug. 13, 1998 Tr.at 66-70.

By May 1989, Ring realized that when Mercurio was indicted hisdual status as an informant and defendant would present adifficult dilemma for the government. Ex. 170; Ring June 9, 1998Tr. at 52-58, 91-99. As Ring understood it, Mercurio'sinvolvement with his codefendants after their indictment wouldimplicate their Sixth Amendment rights to the confidentiality ofjoint discussions of defense strategy, and dealing with thisissue would entail the risk of disclosing that Mercurio wascooperating with the government. Id. Ring discussed this matterwith Kottmyer and the Boston FBI's Principal Legal Adviser,John Michael Callahan. Id. They decided that, in order tominimize the risks that they recognized, Mercurio should beclosed as an informant before he was indicted and instructed notto contact the FBI unless he learned of planned violence orpotential corruption of the judicial process. Id.

Prior to May 8, 1989, Ring and Connolly told Mercurio of theprospective dilemma and the proposed plan for dealing with it.Ex. 170; Ring June 9, 1998 Tr. at 97. At that time Ring expectedto close Mercurio as an informant in about two weeks and to tellhim that had occurred. Ex. 170; Ring June 9, 1999 Tr. at 64,97-98, June 22, 1998 Tr. at 71.

On May 8, 1989, Ring wrote a memorandum to the SAC, Ahearn,describing the issue posed by Mercurio's potential dual status asinformant and defendant, and the proposed plan for dealing withit that he had discussed with Kottmyer, Callahan, Connolly, andMercurio. Ex. 170. Ring did not, however, receive a response tohis recommendations from Ahearn before Ring left for vacation atthe beginning of June 1989. Ring June 9, 1998 Tr. at 64. Thus, hedid not before departing close Mercurio as an informant or tellMercurio that he had done so. Ring June 22, 1998 Tr. at 71-72.

Ring did, however, tell his colleagues, including Connolly,that he felt that the tensions in the LCN might soon explode intoviolence. Ring June 19, 1998 Tr. at 196. Ring's instinct wasright.

On June 5, 1989, Mercurio told Connolly that he, Russo,Carrozza, Ferrara, and "Spucky" Spagnoulo felt under pressurebecause of their anticipated indictments and were angry atSalemme, who was poised to take over after they were indicted,and Charlie Quintina, who had allied himself with Patriarca andSalemme. Ex. 185. Mercurio added that it was believed thatSalemme, Quintina, and Grasso would kill Ferrara if they couldset him up. Id. Thus, Mercurio explained, the Boston LCN washoping to murder Salemme and those associated with him first.Id. As described in § II.28, supra, Flemmi provided Connollywith essentially the same information the next day. Ex. 37 (209dated 6/6/89).

On June 13, 1989, The Boston Herald published an article byShelley Murphy headlined "Ex-con seen as Hub Mob's heirapparent." Ex. TTT;49 Ring June 19, 1998 Tr. at 200-04. Thearticle cites "law enforcement sources" and consists mainly ofinformation that closely tracks the information that is includedin 209s prepared by Connolly based on his discussions withMercurio and Flemmi. Id.; Exs. 37 (209s dated 3/20/89 and6/6/89), 185, 195.

More specifically, the article reported accurately that "localMob leaders" Russo, Carrozza, Lepore, and Mercurio would soon beindicted. Ex. TTT. As Mercurio had told Connolly, the articlestated that Salemme had been "made" a member of the PatriarcaFamily. Id.; Exs. 188, 191 (See also Mercurio 209 dated8/18/88, # 60 in Mercurio informant file). The article went on toexplain that Salemme was meeting frequently with Patriarca and,using the precise term that Connolly ascribed to Flemmi a weekearlier, had Patriarca's "blessing" to take over the Boston LCN'sloansharking and gambling activities when the expectedindictments were issued. Ex. TTT; Ex. 37 (209 dated 6/6/89).Moreover, the article reported that, as Mercurio had toldConnolly, Salemme had also aligned himself with Quintina. Ex.TTT; Exs. 185, 188, 191. In addition, the article contained theaccurate information that the FBI had recentlymade Salemme the subject of a separate investigation. Ex. TTT;Ex. 185. In view of the foregoing, and the fact that the articlewas written while Ring was away from Boston on vacation, thecourt is persuaded that Connolly was a source for the article.

The Boston Herald article may have inflamed the volatile andpotentially violent situation that Mercurio and Flemmi hadrecently reported to Connolly. On June 16, 1989, three days afterit was published, Salemme was shot, but not killed, and Grassowas murdered in Connecticut. June 5, 1998 Tr. at 5. In view ofthe government's objection that the issue of whether the FBIprompted the attempt on Salemme's life related only to thedefendants' motion to dismiss based on outrageous governmentmisconduct on which the court had not granted an evidentiaryhearing, the court did not permit questioning concerning themotive for what the court now recognizes to be the leaking ofhighly confidential and provocative information by the FBI. RingJune 19, 1998 Tr. at 201-03. This ruling may have been a mistake.If Salemme had been murdered by the Boston faction of the LCN,the FBI would have been spared the necessity of developing aprosecutable case against him, and Flemmi and Bulger would haveagain received one of the benefits of their bargain with theBureau — an enhanced opportunity to profit from the vacuumcreated by the decimation of the LCN in Boston. Flemmi Aug. 25,1998 Tr. at 31.

On June 27, 1989, Mercurio told Connolly that the Salemmeshooting and the Grasso murder were planned and carried out bythe Russo faction of the LCN. Ex. 187. Mercurio reported thatRusso, Ferrara, and Carrozza had handled most of the details ofthe Salemme "hit." Id. The 209 records no reference toMercurio's role in the shootings. Id.

Ring returned from his vacation after the Fourth of July. RingJune 9, 1998 Tr. at 92, June 19, 1998 Tr. at 18. He then foundthat on June 9, 1998 Ahearn and ASAC O'Callahan had approved hisrecommendation that Mercurio be closed as an informant. Ex. 170;Ring June 22, 1998 Tr. at 72. The Grasso murder and Salemmeshooting, however, caused Ring to revise his view on whetherMercurio should be closed immediately. Ring June 29, 1998 Tr. at65-66, June 22, 1998 Tr. at 73. Maintaining Mercurio as a sourcehad become especially important in view of the potential for moreviolence, among other things. Ring, June 9, 1998 Tr. at 66, June19, 1998 Tr. at 19, June 22, 1998 Tr. at 73-74. Thus, afterconsulting Ahearn and O'Callahan, Ring decided to postponeclosing Mercurio as an informant, although he still intended todo so shortly before Mercurio was indicted. Ex. 170; Ring June 9,1998 Tr. at 64, June 19, 1998 Tr. at 20, June 22, 1998 Tr. at 73.

On August 2, 1989, another informant who Ring regarded ashighly reliable advised that Mercurio played a central role inthe Salemme shooting. Exs. 188, 194, 237, 246; Ring June 16, 1998Tr. at 55. The informant stated, among other things, thatMercurio had fled after the shooting because he had lured Salemmeto the meeting at which the attempt on his life was made. Exs.188, 194, 234, 246. The informant stated that Ferrara, Russo,Carrozza, and Mercurio were seeking to "finish off" what theystarted before they were indicted. Id. In addition, theinformant reported that while Patriarca was urging Russo andSalemme to settle their problems peacefully, Mercurio wasopposing that effort. Id. Ring believed that this informationwas true and that Mercurio had previously failed to inform theFBI of plans for imminent violent activity in which he wasinvolved. Ring June 19, 1998 Tr. at 20, 254; June 6, 1998 Tr. at6 (Under Seal); Ex. 164. Ring also recognized that there was anenduring threat of additional violence about which Mercurio wouldbe knowledgeable because of his involvement. Ring June 19, 1998Tr. at 19.

As discussed, in § II.6, supra, in 1989, the Attorney GeneralGuidelines, whichwere incorporated in the FBI Manual, required a special reviewprocess if an FBI field office wanted to keep an informant openafter it learned that he had participated in a serious act ofviolence or any other serious crime. Ex. 274 (Under Seal), Manual§ 108, pt. IV(C) (1-12-77); § 137-13(1)(C) (1-31-78); §137-17(1)(G) (1-12-81); § 137-16(1)(G) (3-28-84); SummerfordSept. 16, 1998 Tr. at 62-67. In essence, the Guidelines requiredeither that state or local law enforcement authorities beinformed of the evidence concerning the informant's crime or thatFBI Headquarters and the Assistant Attorney General be promptlyconsulted. Id. Murder and attempted murder are serious acts ofviolence. Summerford Sept. 16, 1998 Tr. at 65, 67. FBIHeadquarters and the Assistant Attorney General should have beenadvised of the credible information that had been receivedconcerning Mercurio's involvement in the Grasso murder andSalemme shooting. Id. at 157-58; Summerford Sept. 16, 1998 Tr.at 18. The Boston FBI, however, did not provide the requirednotification to Headquarters or the Department of Justice.Summerford Sept. 15, 1998 Tr. at 157-58. Rather, it arrogated toitself the decision to continue to utilize Mercurio as aninformant despite the fact that it was believed that he had,while an FBI informant, been involved in murder and attemptedmurder.

When Kottmyer later learned of the reliable report ofMercurio's involvement in the Salemme shooting she asked Ringwhether it presented a problem under the Attorney General'sGuidelines. Kottmyer Aug. 14, 1998 Tr. at 180-81. Ring told herthat it did not. Id.

30. The LCN Induction Ceremony

On October 29, 1989, the Patriarca Family conducted a ceremonyat 34 Guild Street, Medford, Massachusetts, to induct new membersas part of an effort to make peace between its Boston faction andPatriarca's loyalists, including Salemme, who was not present.The FBI bugged 34 Guild Street and recorded that ceremony. It wasthe first time that the FBI had ever overheard an LCN inductionceremony. The interception was perceived and later proven to beof vast value to the government in prosecuting members of the LCNand in publicizing the success of that effort.

Flemmi and Mercurio were two of the four informants relied uponin the application for the court order that authorized the"roving" bug that was employed at 34 Guild Street. As describedin the Conclusions of Law, § III.4, infra, although defendantDeLuca was among those intercepted at 34 Guild Street, theSupreme Court's recent decision in Minnesota v. Carter,525 U.S. 83, 119 S.Ct. 469, 142 L.Ed.2d 373 (1998), persuades thecourt that he does not have standing to litigate whether theelectronic surveillance was obtained in violation of Title III orinvolved a violation of the Fourth Amendment.

The recording of the LCN induction ceremony was, however,played for the grand juries which returned the indictmentsagainst Flemmi in the instant case. Dec. 18, 1997 Tr. at 35.Thus, the court has been required to decide whether that use ofthis evidence that Flemmi helped obtain violated any enforceableagreement which he had with the government. As described in §III.1.D.(3), infra, it does. In addition, the manner in whichConnolly and Ring dealt with Mercurio concerning the ceremony issufficiently distinctive to be probative of Flemmi's claims thathe and Bulger, like Mercurio, were generally protected byConnolly and the FBI in return for their services as informantsand, as part of that protection, were alerted to their imminentindictment so they could flee.

In United States v. Ferrara, 771 F. Supp. 1266 (D.Mass. 1991),this court made findings of fact relating to the electronicsurveillance conducted at 34 Guild Street. Those findings werebased on a limited record. Kottmyer was the only witness, and thecourt accepted an affidavitfrom Ring. Ferrara, 771 F. Supp. at 1275-81. In addition, in1991, the court did not require the government to respond toquestions that might disclose the identity of any informant. Aug.12, 1998 Tr. at 43.

In the instant case, Mercurio's role as an FBI informant andperson present at the ceremony has for the first time beenrevealed; many more documents have been reviewed, including atleast one, Exhibit 164, that the government acknowledges shouldhave been disclosed in 1991; and many more witnesses havetestified. As a result, the court is now persuaded that in 1989,Ring, among others, did not share significant information withKottmyer, the applicant, or Special Agent Walter Steffens, Jr.,the affiant, regarding the then proposed electronic surveillancethat captured the Mafia induction ceremony. This was part of alarger effort intended to assure that information that mightsuggest that Mercurio was an informant would not be disclosed toany judge. Because she was incompletely informed, although honestas to her understanding, Kottmyer's 1991 testimony was notreliable in certain, important respects.

Because of the more accurate and complete information nowavailable, the findings of facts in this case differ in some, butnot all, respects from those made in 1991. Among other things,the court now finds the following.50

At all times prior to October 29, 1989, the FBI, personified byRing, knew that there would be at least one informant, Mercurio,at the ceremony.51 The FBI sought a warrant for a "roving"bug that could be used at multiple, unidentified locations,rather than authorization to conduct electronic surveillance at34 Guild Street alone, in order to protect the identity of itssources. The FBI had no intention of using that warrant tointercept conversations more than once. Rather, at the time theapplication was drafted, the FBI intended to arrest theparticipants immediately after the ceremony. The FBI hadsubstantial, corroborated "rock solid" information that theceremony would be held at 34 Guild Street several hours beforeKottmyer and Steffens met with the judge to obtain the warrantauthorizing roving surveillance based upon the representationthat it was then "impractical" to identify the location to bebugged.

The FBI made no effort to obtain the testimony of Mercurioabout the induction ceremony. Nor did the FBI ask him to recordthe ceremony, which would have obviated the need for a courtordered bug.Instead of seeking to persuade Mercurio to cooperate in thisfashion by threatening him with possible prosecution for his rolein the Salemme shooting, as well as the Sagansky-Weinsteinextortion and other activities intercepted at Vanessa's, Ring andConnolly alerted Mercurio to the bugging of the Mafia inductionceremony and, as previously contemplated, permitted him to fleethe indictment that they caused him to understand was imminent.

As a result, the FBI was relieved of the risk that theprosecution of Russo, Ferrara, Carrozza, and their co-defendantswould be jeopardized by the issues that would have been presentedby Mercurio's dual status as a defendant and an FBI sourceconcerning the induction ceremony, among other things. Mercurio'sflight also masked for many years the violation of the AttorneyGeneral's Guidelines committed by Ring and his colleagues whenthey decided to continue Mercurio as an informant, despite hisperceived involvement in the Salemme shooting, without consultingFBI Headquarters and, particularly, the Assistant AttorneyGeneral.

More specifically, after the Grasso murder and the Salemmeshooting, the government understood the potential for additionalviolence involving the Patriarca and Boston factions of the LCN.Kottmyer Aug. 12, 1998 Tr. at 12. In the summer of 1989, variousinformants kept the FBI advised of developments in the PatriarcaFamily. Among other things, they reported the following.

Russo and Ferrara believed that Patriarca had receivedinformation indicating that Ferrara was trying to make a dealwith the FBI, causing Patriarca to want to have Ferrara murdered.Ex. 248. Thus, they made a preemptive strike against Salemme andGrasso. Id. After the shootings, Patriarca feared that Russo'screw would try to kill all of his allies. Mercurio Aug. 14, 1998Tr. at 16-17; Exs. 162, 188, 191, 192, 247, 248. In an effort topromote peace, Patriarca made Russo Consigliere of the Family.Id. Russo insisted that about fifteen new members of the Familybe made, including three or four immediately. Id. Patriarcaindicated that he was agreeable, but was reportedly actuallystalling in the hope that the anticipated federal indictmentswould remove the Boston faction as a threat and eliminate thenecessity of making new members loyal to it. Id. Beginning inJune 1989, Mercurio was among those telling the FBI that theremight soon be a ceremony to make new members of the PatriarcaFamily. Mercurio Aug. 4, 1998 Tr. at 16-17.

During the summer of 1989, informants also reported that Russoand other members of the LCN were meeting at a variety of newlocations and would at times talk while walking outside. Exs.191, 196, 188 (at 57-66). Physical surveillances conducted by theFBI confirmed this. Ex. 188 (at 57-64).

Ring did several things in response to this situation. He hadKottmyer draft criminal complaints concerning Russo and hiscolleagues. Kottmyer Aug. 12, 1998 Tr. at 65; Ring June 9, 1998Tr. at 133-37. He and Kottmyer wanted the complaints to beimmediately available if it proved necessary to make arrestspromptly. Id.

The information he had received concerning the potential forviolence, the possibility of an induction ceremony that could bebugged, and the uncertainty as to where that ceremony would beheld also prompted Ring, in July 1989, to assign Steffens tobegin drafting an affidavit to support an application for awarrant for a roving bug. Ring June 22, 1998 Tr. at 12-13. Ringalso discussed with Kottmyer in about July 1989 the possibilityof getting a roving warrant. Ring June 19, 1998 Tr. at 32.

Title III permits the government in certain limitedcircumstances to obtain an order authorizing the interception ofparticular conversations at one or more unspecified locations,notwithstanding the particularity clauses of the FourthAmendment. 18 U.S.C. § 2518(11)(a)(ii)(1994). More specifically, as this court has previously written:

The Fourth Amendment requires that searches and seizures be reasonable and establishes certain requirements for the issuance of warrants. Among these is the requirement that any warrant "particularly describ[e] the place to be searched, and the persons or things to be seized." U.S. Const. amend. IV. As originally enacted, Title III implemented the particularity clauses of the Fourth Amendment by requiring: (1) that each application concerning electronic surveillance include "a particular description of . . . the place where the communication is to be intercepted," 18 U.S.C. § 2518(1)(b)(ii), and (2) that the judge find that "the place where, . . . communications are to be intercepted [is] being used, or [is] about to be used," in the commission of a specified offense, § 2518(3)(d).

In enacting Title III, Congress expressed the belief that electronic surveillance was indispensable to investigating and prosecuting organized crime. Subsequently, many cases in Massachusetts and elsewhere showed this conviction to be correct. As the ability of the government to intercept criminal conversations became manifest, however, sophisticated criminals began structuring their communications to frustrate efforts to intercept them.

In recognition of this, Title III was amended in 1986 to add "roving intercept [bug]" and "roving wiretap" provisions, 18 U.S.C. § 2518(11) (1988). With regard to the roving intercept provision at issue in the instant case, subsection 11 provides that the usual particularity requirements of Title III, § 2518(1)(b)(ii) and (3)(d), do not apply if a judge finds such specification is not practical, based upon an application by the government containing:

a full and complete statement as to why such specification is not practical and identif[ying] the person committing the offense and whose communications are to be intercepted.

§ 2518(11)(a)(ii).

In essence, the roving intercept provision replaces the usual practice that the place to be searched be identified in a warrant by an address with a description of that place as the location at which an identified person is engaging in identified criminal conversation. Thus, a roving intercept order gives executing officers less specific direction, and more discretion, concerning the place to be searched than a conventional warrant.

Ferrara, 771 F. Supp. at 1270-71 (emphasis added).

When he received his assignment to draft an affidavit tosupport an application for a roving bug, Steffens had no trainingor experience concerning the requirements of Title III. SteffensAug. 6, 1998 Tr. at 64-67. He viewed the assignment as a goodopportunity for on the job training. Id.

When he received his assignment, Steffens did not seek legaladvice from Kottmyer or any other Strike Force attorney. Id. at71. Rather, he consulted the Boston FBI's Principal LegalAdvisor, Callahan, and several more experienced FBI agents. Id.at 68-69.

Callahan gave Steffens an annotated form to be used as a guidefor the preparation of an affidavit in support of an applicationfor authorization to intercept either wire communications or oralcommunications. Steffens Aug. 10, 1998 Tr. at 138-39; Ex. 197.Callahan told Steffens that he would want to review any affidavitbefore it was filed. Steffens Aug. 6, 1998 Tr. at 65-66. However,after consulting Ring, Steffens did not provide Callahan with acopy of the affidavit that he filed on October 27, 1989. Id.

As indicated earlier, in order to receive authorization for aroving bug to be used to intercept oral communications, thegovernment is required to submit to the court "a full andcomplete statement as to why[it] is not practical" to specify the place to be bugged as isgenerally required by 18 U.S.C. § 2518(1)(b)(ii) and 3(d). Thestatutory standard for obtaining a roving wiretap order,however, is somewhat different. To obtain a warrant authorizingwiretapping at an unspecified location, the government was in1989 required to identify the person committing the allegedoffense and make "a showing of a purpose, on the part of thatperson, to thwart interception by changing facilities."18 U.S.C. § 2518(11)(b)(ii) (1989).52

Thus, while the roving intercept and roving wiretap provisions were apparently similarly motivated, they include somewhat different, and potentially confusing, standards. More specifically, the roving intercept provision requires a "full and complete statement;" the roving wiretap provision does not. Similarly, the roving intercept provision requires a showing that it is impractical to satisfy the usual specification requirements of Title III; [in 1989] the roving wiretap provision require[d] a demonstration that the individual to be targeted [was] attempting to evade interception.

Ferrara, 771 F. Supp. at 1289.

The annotated form that Callahan gave Steffens recognized thedifference in the requirements for obtaining authorization forroving bugs and roving wiretaps. Ex. 197. It stated, in pertinentpart, that:

When requesting a roving wire interception, you must establish that the specifically targeted subject(s) uses various and changing facilities for the purpose of avoiding electronic surveillance (2518(11)(b)(ii)). This purpose may be evinced either by informant information (e.g., the subject's past or current statements to that effect) or by the subject's actions over a period of time (e.g., physical surveillance establishing that the subject travels from phone to phone to call other coconspirators). Roving wiretaps will be authorized for public telephones only, and only when it is clear that the telephones cannot be identified in advance, and the subject's intent to avoid electronic surveillance is manifested clearly.

In roving oral interceptions (2518(11)(a)(ii)), you must establish probable cause that it is not practical to specify the place where the oral communications of the targeted individual(s) are to be intercepted. Once again, a roving oral interception will be authorized only for public facilities, vehicle, hotel rooms, or similar locations, and a pattern of activity demonstrating the impracticability of naming specific premises must be established.

Ex. 197 (emphasis added).

In 1989, Steffens knew that there was some distinction betweenwhat was required to obtain a warrant for a roving bug and aroving wiretap. Steffens Aug. 6, 1998 Tr. at 70-71. Nevertheless,he believed that to obtain a warrant for a roving bug it was onlynecessary to show the use of various and changing locations.Id. This view was mistaken. Section 2518(a)(ii) requires notonly an effort to evade surveillance, but a successful effortwhich renders it "impractical" to identify the place to be buggedat the time the warrant is issued. Ferrara, 771 F. Supp. at1309.

Throughout the summer and early fall of 1989, Steffenscollected information for his draft affidavit. At the same time,Ring was working hard to prevent the attorneys who wouldprosecute the Russo faction from knowing that Mercurio was aninformant and from reviewing his FBI file.

Jeffrey Auerhahn and Gregory Sullivan were the Strike Forceattorneys presenting the case against Mercurio, Russo, and othersto the grand jury. Kottmyer Aug. 13, 1998 Tr. at 64-65. When theylearned that Mercurio's parole had been terminated early, theysuspected corruption and wanted to investigate. Id. Kottmyerknew that Mercurio was an FBI informant and discussed the matterwith Ring. Id. at 66; Ex. 200. Kottmyer felt that it wasessential that Auerhahn and Sullivan be advised of Mercurio'sstatus, and be permitted to review his FBI informant file todetermine whether it contained any exculpatory information orevidence to support an authorization defense, or raised anypossible issues concerning whether Sixth Amendment rights hadbeen violated because an informant was reporting putativedefendants' discussions with their attorneys, among other things.Kottmyer Aug. 13, 1998 Tr. at 66; Ex. 200.

On several occasions, Kottmyer presented her position that herassistants must view Mercurio's informant file to Ring, the SAC,Ahearn, and the ASAC, O'Callahan. Kottmyer Aug. 13, 1998 Tr. at66-69, Aug. 14, 1998 Tr. at 169-70. She also explained to themher concerns about possible exculpatory information, evidence ofauthorization, and Sixth Amendment issues that only the attorneysworking on the case could properly assess. Id. The UnitedStates Attorney, Wayne Budd, supported Kottmyer's requests. June6, 1998 Tr. at 6 (Under Seal). Nevertheless, Ring and hiscolleagues refused to permit Auerhahn and Sullivan to be toldthat Mercurio was an informant or to review his file. Ex. 200.

On September 1, 1989, Kottmyer sent a memorandum to DavidMargolis, the Chief of the Organized Crime and RacketeeringSection of the Criminal Division of the Department of Justice,seeking support for her insistence that Auerhahn and Sullivan bepermitted to review Mercurio's informant file. June 6, 1998 Tr.at 5-7 (Under Seal); June 15, 1998 Tr. at 18-19 (Under Seal).Kottmyer told Margolis that a proposed RICO indictment ofMercurio and others would soon be submitted. Id. She alsoadvised him that O'Sullivan had requested the early terminationof Mercurio's parole in part to decrease the likelihood ofpretrial detention when Mercurio was indicted. June 15, 1998 Tr.at 18-19 (Under Seal). Kottmyer explained her concerns aboutexculpatory information, the possible authorization defenseMercurio might assert based in part on the successful effort tohave his parole terminated, and foreseeable Sixth Amendmentissues that could arise when Mercurio was charged. Id.; June 6,1998 Tr. at 5-7 (Under Seal). Kottmyer also told Margolis thatthe FBI was in possession of reliable information, which itbelieved to be true, that Mercurio had set up the June 19, 1989attempted murder of Salemme. June 6, 1998 Tr. at 6 (Under Seal).

The proposed indictment of Mercurio, Russo, and theircolleagues was submitted to the Department of Justice later inSeptember 1989. Kottmyer Aug. 12, 1998 Tr. at 68, 73. OnSeptember 28, 1989, Kottmyer wrote to Margolis again to reiterateand amplify her contention that it was essential that Auerhahnand Sullivan be allowed to review Mercurio's informant file. June6, 1989 Tr. at 7 (Under Seal). Margolis was persuaded and,without the authorization of the FBI, decided to tell Auerhahnand Sullivan of Mercurio's status. Ex. 200.

On October 4, 1989, Ring sent a memorandum to Ahearn recitingthe history of his dispute with Kottmyer; explaining his viewthat the prosecutors had no need to know that Mercurio was aninformant; and recording his previously expressed concern that ifthe prosecutors were told of Mercurio's status, it might bedisclosed in court, thus endangering Mercurio. Id. Kottmyer,however, had asserted that no indictments would be returnedunless and until Auerhahn and Sullivan reviewed Mercurio'sinformant file. Id. Ring urgedthat any review of Mercurio's file be done only by FBI personneland that the SAC go to Washington if necessary to support hisposition. Id. The next day, however, Kottmyer reaffirmed toAhearn that Auerhahn and Sullivan would have to review Mercurio'sfile before any proposed indictment would be presented to thegrand jury. June 6, 1998 Tr. at 7 (Under Seal).

The FBI's battle to keep Auerhahn and Sullivan from reviewingMercurio's informant file continued throughout October 1989. Ex.168. It was finally resolved by an agreement between high levelofficials of the Department of Justice and FBI in Washington,D.C. Id. On October 25, 1989, it was agreed that Sullivan wouldbe allowed to review Mercurio's informant file in the presence ofan FBI agent, but could not take notes or copy any document.Id. The information Sullivan acquired could only be disclosedto Kottmyer, Auerhahn, and the attorneys at the Department ofJustice who already knew that Mercurio was an informant. Id. Inaddition, the Department of Justice agreed to the FBI's conditionthat Mercurio's "relationship with the FBI . . . not be disclosedwithout the prior approval of the FBI." Id. Subject to theforegoing conditions, Sullivan read Mercurio's informant file onOctober 26, 1989. June 6, 1998 Tr. at 8-9 (Under Seal).

The determined effort by Ring and the FBI to keep theprosecutors from knowing that Mercurio was an informant, in partto minimize the risk that his status would be disclosed to thecourt and possibly others in future litigation, illuminates themotivation for many other decisions made in September and October1989. In late September or early October Mercurio told the FBIthat Vincent Federico, Richard Floramo, Carmen Tortora, andRobert DeLuca would soon be made new members of the PatriarcaFamily. Mercurio Aug. 4, 1998 Tr. at 15-17, 79-80. Mercuriorelated that Ferrara had told him that the ceremony would have tobe conducted while Federico, who was in prison, was on furlough.Id. at 79, 82-83, Aug. 5, 1998 Tr. at 82. Mercurio alsoreported that the ceremony would be held somewhere in thevicinity of the Howard Johnson's restaurant at Wellington Circle,Medford, Massachusetts. Mercurio Aug. 4, 1998 Tr. at 95-98.Mercurio said that he had been designated to drive participantsfrom Wellington Circle to the site of the ceremony. Id.

Ring and Connolly continuously asked Mercurio to provide themmore information concerning the ceremony. Id. at 91, 102.Mercurio provided the information he received promptly toConnolly or Ring. Id. There are, however, no 209s reflectingthe information Mercurio furnished to the FBI about a monthbefore the ceremony.

Mercurio's reports prompted the FBI to seek information aboutthe forthcoming induction ceremony from other sources. Someinformation was obtained from a source in Rhode Island. KottmyerAug. 12, 1998 Tr. at 15-16, Aug. 13, 1998 Tr. at 27. In addition,after receiving the information that Mercurio provided in lateSeptember or early October 1989, Connolly told Flemmi about theanticipated ceremony and asked him to try to find out about it.Ex. 92; Flemmi Sept. 1, 1998 Tr. at 61, 63-65, 68-69. Flemmiagreed and tried, but failed, to get helpful information forConnolly. Flemmi Sept. 1, 1998 Tr. at 64-65.

About a week before the ceremony, Ferrara told Mercurio thatFederico had received a furlough for Sunday, October 29, 1989,and that the induction ceremony would be held then. Mercurio Aug.4, 1998 Tr. at 98, Aug. 5, 1998 Tr. at 39. Mercurio promptlyreported this to the FBI and said that the ceremony was a"definite go" for October 29, 1989. Mercurio Aug. 4, 1998 Tr. at19-20, 26-27, 87-88, Aug. 5, 1998 Tr. at 38. Mercurio still didnot have the address of the ceremony. Mercurio Aug. 4, 1998 Tr.at 48. However, as one who would be driving participants to theceremony, he and the FBI expected that he would be told it inadvanceof the event. Mercurio Aug. 5, 1998 Tr. at 40.

On Friday, October 20, 1989, Kottmyer met with Ahearn,O'Callahan, and Ring. Kottmyer Aug. 12, 1998 Tr. at 5-6, 45. Theytold Kottmyer that the Patriarca Family would be conducting aninduction ceremony in the near future. Kottmyer Aug. 12, 1998 Tr.at 15. Kottmyer understood that Mercurio was one source of theFBI's information about the ceremony and that his information hadcatalyzed the meeting in which she was participating. Id. at15-16. Information emanating from Rhode Island was also discussedwith Kottmyer. Id. at 15-16, 40, Aug. 13, 1998 Tr. at 27-28.Therefore, she knew that Mercurio was not the FBI's sole sourceof information about the ceremony. Id.

The representatives of the FBI indicated that they wanted toseek a warrant that would permit them to intercept and record theanticipated ceremony. Kottmyer was told, however, that few peopleknew about the induction ceremony and if information about itwere included in an application for a warrant, it could lead tothe identification of the FBI's source or sources. Kottmyer Aug.12, 1998 Tr. at 59. Thus, Kottmyer was told that informationconcerning the ceremony was regarded as "singular" by the FBI andthat the Bureau would not allow it to be used in any submissionto the court for fear that doing so would have the effect ofidentifying one of its informants. Id. at 44-45; Ring June 11,1998 Tr. at 141-42, June 6, 1998 Tr. at 8.

Kottmyer believed that once the FBI told her that theinformation was singular, she could not lawfully use thatinformation in an application for a warrant because she did not,under the pertinent provisions of the Code of FederalRegulations, have the authority to disclose an informant'sidentity. Kottmyer Aug. 12, 1998 Tr. at 45-46, 52-57. At thetime, the relevant regulations provided that ordinarily nodisclosure of an informant's identity could be made unless theinformant and the agency utilizing him did not object.28 C.F.R. § 16.26(b)(4). However, any such objection would be trumped ifthe Deputy Attorney General or Associate Attorney General"determine[d] that the administration of justice require[d]disclosure." 28 C.F.R. § 16.26(c).

Everyone present on October 20, 1989 wanted to intercept theanticipated ceremony. Electronic surveillance of Russo, who hadnot been previously intercepted, would strengthen the proposedcase against him. Kottmyer Aug. 12, 1998 Tr. at 47, Aug. 13, 1998(P.M.) Tr. at 5-6. In addition, the FBI had never succeeded inrecording a Mafia induction ceremony. Ring June 5, 1998 Tr. at45. As Ahearn wrote on October 30, 1989, "[t]he Bureau had anoutstanding opportunity for the first time ever, of overhearingand recording an LCN induction ceremony, which would beinvaluable for years to come at other LCN trials andCongressional hearings." Ex. 183.

Thus, Kottmyer was presented with the question whether anapplication for a warrant to conduct electronic surveillance thatwould be used to intercept the forthcoming induction ceremonycould lawfully be presented without reference to that ceremony.Kottmyer Aug. 12, 1998 Tr. at 45-47, 56-57. As long as theinformation concerning the ceremony remained singular, Kottmyerfelt there were two options — foregoing the application forelectronic surveillance or submitting it without any reference tothe ceremony if it were legally permissible to do so. Id.

The FBI definitely wanted to proceed with the application,without including the information that it deemed singular. Id.at 47. Thus, Kottmyer was asked to review all of the availableinformation to determine whether there was sufficient, currentprobable cause to support an application for roving electronicsurveillance that could be filed without any reference to theinduction ceremony. Id. at 47-48. At the conclusion of themeeting, Kottmyer was given the draft affidavit intended tosupport an application for a roving bug or wiretap that Steffenshad been preparing. Id. at 48.

However, in what would become a pattern in the following week,the FBI did not provide Kottmyer with the detailed informationthat Mercurio had furnished concerning the forthcoming inductionceremony. More specifically, Kottmyer was not told that Mercuriohad identified the four people who would be inducted; that theceremony would be conducted while Federico was on furlough; thatWellington Circle in Medford would be a meeting place for atleast some of the participants; or that Mercurio would be drivingpeople from there to the ceremony. Id. at 37-39.

Kottmyer had never prepared an application for rovingelectronic surveillance before. Kottmyer Aug. 13, 1993 (P.M.) Tr.at 26. She was, however, generally familiar with the statutoryprovisions concerning roving bugs and wiretaps. Id. at 27. Overthe weekend, she did some research on the roving bug provisionsof Title III, which had been enacted in 1986. Kottmyer Aug. 13,1998 Tr. at 116, Aug. 13, 1998 (P.M.) Tr. at 26, Aug. 14, 1998Tr. at 160. She read the statute and a treatise. Id. She alsoreviewed the applications and affidavits utilized to apply forwarrants for both roving and conventional, fixed electronicsurveillance in another case, United States v. David. KottmyerAug. 14, 1998 Tr. at 160, 167. Kottmyer did not that weekend, orat any other time, discuss with anyone at the Department ofJustice whether 18 U.S.C. § 2518(11)(a)(ii), which required a"full and complete statement" as to why it was "impractical" toidentify the place to be bugged, meant that reliable informationconcerning the address at which the ceremony would be held had tobe included if it were obtained before the application was filed.Id. at 159.

During the weekend Kottmyer decided that she could comply withthe statutory requirements for a roving bug without including anyreference to the induction ceremony in the application becausethere was current probable cause to support the application basedon electronic surveillance that had been conducted in Connecticutand physical surveillances. Kottmyer Aug. 12, 1998 Tr. at 56. InKottmyer's view, an application for a roving bug was appropriateif specification of the place to be bugged was not feasible, andtherefore was impractical, because the targets were usingchanging locations to conduct their criminal business. KottmyerAug. 14, 1998 Tr. at 166. She recognized, however, that it mightin certain circumstances be practical, and therefore necessary,to identify the place to be bugged even if targets werefrequently changing locations in an effort to thwart electronicsurveillance. Id. at 167. In such a case, the government couldapply for separate warrants authorizing conventional and rovingelectronic surveillance. Id. Indeed, this was done in theDavid case. Id.

With regard to the duty of disclosure to the court, Kottmyerbelieved that the statutory requirements were the same for a"full and complete statement" regarding probable cause andregarding the impracticality of identifying the place to bebugged when an order for roving bug was at issue. Kottmyer Aug.13, 1998 Tr. at 123, Aug. 13, 1998 Tr. (P.M.) at 9-12. Thisunderstanding was incorrect.

With regard to establishing that there is probable cause for the issuance of a warrant, the government must make "a full and complete statement of the facts and circumstances relied upon by the applicant, to justify his [or her] belief that an order should be issued." § 2518(1)(b) (emphasis added). Thus, the government has some discretion to rely upon and disclose less than all of its evidence tending to establish probable cause, as long as there is no effort to mislead the court into approving a warrant which might otherwise not have been issued.

In contrast to the requirements concerning probable cause, the government's obligation to make a "full and complete statement" concerning the practicality of specifying the place or places to be bugged is unqualified; the government is obligated to inform the court of all of its information relating to this issue.

Ferrara, 771 F. Supp. at 1306-07 (emphasis added).

Thus, with regard to establishing probable cause, thegovernment generally has legitimate discretion not to rely onsingular information that could lead to the identification of asource and, therefore, to omit such information from the sectionof its application for a warrant that seeks to establish probablecause. With regard to an application for a roving bug, however,if such singular information also relates to whether it isimpractical to specify the location to be bugged, the governmentdoes not have the discretion to withhold it from the court.

As Kottmyer knew, the Department of Justice and the courts hadauthorized the use of sealed, supplemental submissions as a meansof advising judges of singular information that the governmentbelieved could not be safely included in the application andaffidavits that would ultimately be disclosed to defendants.Kottmyer Aug. 14, 1998 Tr. at 162-65.53 Kottmyer, however,had misgivings about this approach, in part because thegovernment could not control whether the information would bedisclosed in the future and in part because of concerns about thepropriety of litigating the admissibility of evidence obtained bycourt ordered electronic surveillance without a defendant knowingall of the information on which the court relied in issuing thewarrant. Id. at 164-65. Thus, Kottmyer did not consider thisapproach in October 1989. Id.

By Monday, October 23, 1989, Kottmyer had decided that it waspermissible and appropriate to ask the Department of Justice togive expedited authorization for an application for a roving bug.Kottmyer Aug. 12, 1998 Tr. at 7-8. The FBI's strategy with regardto the application was explained by Ahearn in an October 30, 1989memorandum to the Director of the FBI. Ex. 183. He wrote:

Within the last week, information was developed by Boston that a major sit down was to be held in Boston on Sunday, October 29, 1989 at which time new members would be inducted and the internal dispute settled.

As FBIHQ is aware, the Boston Division immediately submitted for approval affidavits in support of two separate MISURS [microphone surveillance] installations which were intended to intercept conversations in a vehicle and at a meeting of the hierarchy of the Patriarca Family, on Sunday, 10/29/89. Expected to be in attendance at the meeting were RAYMOND PATRIARCA, the Boss; NICKY BIANCO, the Underboss, J.R. RUSSO, the Consigliere, and all nine Capos. Although four sources of the Boston Division have provided the probable cause to support application for these MISURS, in an attempt to continue to protect their identities Boston utilized transcripts from a New Haven Division intercept. These transcripts had been provided to Boston previously by New Haven for use in an affidavit prepared and submitted by the Springfield RA with full knowledge of New Haven.

It was also the Boston Division's intention to effect the arrests of RUSSO, VINCENT FERRARA, and ROBERT CARROZZA at the conclusion of the meeting. Top echelon informants have advised that these three subjects are expecting to be indicted, and intend to flee the area as soon as they believe the indictment is about to be returned. Historically, Boston has experienced little success in preventing indictments from leaking prematurely, and therefore opted to seek complaints and warrants just prior to indictment. More importantly, the potential for additional violence within the family increases daily. RUSSO, CARROZZA, and FERRARA were responsible for planning and approving the murder of former Underboss BILLY GRASSO, and the attempted murder of FRANK SALEMME. The attempt on SALEMME was made with automatic weapons being fired from a moving vehicle in a crowded shopping center with total disregard for the safety of innocent bystanders. As SALEMME ran from his attackers, they sprayed the area with automatic weapons fire.

Id. (emphasis added).

Ahearn's memorandum indicates that neither he nor Ring had anyintention or desire to use the warrant that they were seeking fora roving bug more than once, to intercept the forthcominginduction ceremony. As discussed, infra, until overruled by FBIHeadquarters on October 27, 1989, they intended to use thecomplaints previously drafted to arrest Russo, Ferrara, andCarrozza after the ceremony. Ahearn did not inform the Directorthat Mercurio had also expressed his intention to flee. Assubsequent documents, among other things, confirm, the FBI didnot intend to arrest Mercurio on a complaint to prevent hisflight.

Kottmyer and Steffens worked hard on October 23, 1989 tofinalize his affidavit. Steffens Aug. 6, 1998 Tr. at 39, 139;Kottmyer Aug. 12, 1998 Tr. at 77. Ring controlled and limited theaccess that they had to information from informants that could beincluded in the affidavit. Steffens Aug. 6, 1998 Tr. at 36, Aug.10, 1998 Tr. at 97. Mercurio was one informant relied on in theaffidavit, but neither Kottmyer nor Steffens had the opportunityto review his full informant file. Steffens Aug. 10, 1998 Tr. at98-99, 108-09, 121. Rather, they relied on the limitedinformation provided by Ring. Id.

Ring gave Steffens informant information for his affidavit forthe first time on October 23, 1998. Id. at 108; Exs. 192, 194.That information was not included in the draft affidavit thatKottmyer was furnished on October 20, 1989. Id. The informantinformation that Ring gave Steffens included no references to theforthcoming induction ceremony. Exs. 192, 194; Ring June 19, 1998Tr. at 39-40. Initially, Ring refused to allow Steffens to seethe 209s which contained the information Ring had summarized forinclusion in the affidavit, but acquiesced when Kottmyer insistedthat Steffens review them. Id. at 109. Ring never told Steffensthe identity of any informant. Aug. 6, 1998 Tr. at 29-30. Ringdid, however, emphasize to Steffens that information about theinduction ceremony was singular and had to be maintained asconfidential. Steffens Aug. 6, 1998 Tr. at 62.

Pursuant to Ring's instructions, the affidavit that Steffensand Kottmyer drafted named Russo, Carrozza, and Ferrara astargets. Exs. 188 (Under Seal), 190 (Under Seal); Ring June 19,1998 Tr. at 252-55. It was expected that Mercurio would beoverheard as well. Ring June 19, 1998 Tr. at 252-55. Pursuant to18 U.S.C. § 2518(1)(b)(iv), Mercurio was required to have beennamed as a target "if the Government ha[d] probable cause tobelieve that [he was] engaged in the criminal activity underinvestigation and expect [ed] to intercept [his] conversations."United States v. Donovan, 429 U.S. 413, 428, 97 S.Ct. 658, 50L.Ed.2d 652 (1977); see also Ferrara, 771 F. Supp. at 1314-15.In this case, however, the failure to name Mercurio as a targetwas consistent with the FBI's intent to treat him as a protectedsource rather than as subject to prosecution for hisparticipation in the induction ceremony. In any event, Mercuriowas identified as "CS-1" in the Steffens Affidavit. June 10, 1998Tr. at 100.

Flemmi was "CS-2" in the Steffens Affidavit. Coffey Aff., Apr.9, 1997, at 3-4. With regard to his qualifications, Steffensstated that Flemmi had provided reliable information for morethan seven years and that:

Information provided by this informant has led to the arrest and conviction of more than eight individuals for the crimes of illegal gambling and loansharking in connection with a major LCN criminal enterprise. Information provided by this informant has been utilized in prior Title III intercepts authorized by United States District Court. During the course of this informant's confidential relationship with law enforcement authorities, information he provided has been corroborated by independent investigation, other reliable informants and information obtained from court authorized electronic surveillance. CS-2 has stated [that] he will not testify against the subjects due to fear of reprisals.

Ex. 188 (Under Seal).

On October 21, 1989, Flemmi left Boston on an InternationalAssociation of Airborne Veterans parachute jumping trip to Asia.Ex. 250. He did not return until October 31, 1989. Id. Thus, hewas not available to provide the FBI with any emerginginformation about the ceremony in the week before it occurred.

Flemmi was not among those intercepted at 34 Guild Street onOctober 29, 1989. Nor did he have a possessory interest or otherrelationship with the premises. Therefore, the issues of whetherit was proper to present the evidence of the intercepted Mafiainduction ceremony to the grand juries which returned indictmentsagainst him and whether it is permissible to use such evidenceagainst Flemmi in any trial must be analyzed in the context ofhis claim to have an enforceable agreement with the governmentrather than under Title III. See § III.1.D(3), infra.

In any event, the affidavit to which both Mercurio and Flemmicontributed employed the approach required by Ring. Ex. 188.Russo, Ferrara, and Carrozza were the only named targets. Id.It was stated that there was also probable cause to believe thatevidence concerning Patriarca, Nicholas Bianco, MatthewGugliametti, Jr., Gaetano Milano, Louis Failla, John Castegna,John Farrell, and Frank Pugliano would be intercepted. Id.Mercurio was not described as a person as to whom evidence wasexpected to be acquired. Id.

The section of the affidavit concerning probable cause focusedon the rift in the Patriarca Family and, especially, the Grassomurder and Salemme shootings. Id. It emphasized informationindicating that Russo, Ferrara, and Carrozza used various andchanging locations to meet and talk. Id.

The affidavit did not disclose that those directing matters forthe FBI intended to use the authority for a roving bug only once,to intercept a Mafia induction ceremony at a location theyexpected to know in advance. Id. Nor did the affidavit disclosethat at least one informant would be at the ceremony. Id.

The affidavit did represent that all of the informants hadstated that they would not testify because of fear of reprisals.Id. at 13, 16, 17, 18. Although not known to Steffens andKottmyer, who were relying on information provided by Ring, thisstatement was not accurate. Neither Flemmi nor Mercurio was askedto testify or said that he would not for fear of reprisal.Mercurio Aug. 4, 1998 Tr. at 85, 104; Flemmi Sept. 5, 1998 Tr. at23-25. It was, however, true that if asked, both Mercurio andFlemmi would have said that they did not wish to testify becausethey did not want to be revealed as informants. Mercurio Aug. 15,1998 Tr. at 28, 85, 120.

The affidavit also stated that the issuance of orders grantingimmunity and compelling testimony were likely to be unavailing.Ex. 188 at 69. With regard to Mercurio, this may not have beentrue. Ring knew that Mercurio did not want to return to prisonand could, in October 1989, have been fairly threatened with thepossibility of prosecution for the Salemme shooting, with apotential life sentence, as well as for the Sagansky-Weinsteinextortion and other criminal activity intercepted at Vanessa's.As Ring explained, witnesses in Organized Crime cases are oftenreluctant to testify initially, but at times change their mindswhen the FBI is persistent in pursuing them. Ring Sept. 22, 1998Tr. at 120-22, 138-40. This approach was not employed with regardto Mercurio. If tried, it might have succeeded. According to thegovernment's expert, James Darcy, informants in LCN cases havebecome cooperating witnesses when faced with the prospect oflengthy sentences in RICO cases. Darcy Sept. 28, 1998 Tr. at 136.In the instant case, in 1997, Mercurio acknowledged that he hadbeen an FBI informant and testified after perceiving the prospectof being held in civil contempt. See United States v. Salemme,978 F. Supp. 379, 381 (D.Mass. June 19, 1997).

Steffens' affidavit did truthfully state that the four sourcesutilized had provided valuable information in other cases. Ex.188 (Under Seal). Thus, Steffens accurately reported that onereason that the government did not try to compel its sources totestify was that, "use of informant testimony, even if compelledby a grant of immunity, would seriously jeopardize, if notdestroy, the future usefulness of those informants in otherinvestigations." Id. at 68.54

On October 23, 1989, Ring spoke to Maduro, who was stillworking in the Organized Crime Section at FBI Headquarters, toadvise him that Steffens would soon deliver his affidavit and arequest for expedited authorization to apply for a warrant. Ex.195.55 As a result of this conversation, on October 24, 1989,Maduro wrote the following back to Boston:

In furtherance of investigative objectives in the Salemme case, Boston is preparing an affidavit in support of an application for emergency title III electronic surveillance (ELSUR) of a meeting between members of the Patriarca LCN Family (representing the Patriarca LCN "dissident faction") which is scheduled to occur on or about Sunday, 10/29/89, at a presently unknown location in Boston. Reliable and singular top echelon informant information indicates that the purpose of this meeting is to make new Patriarca LCN members. Boston will be in a position to identify the precise location of this meeting and upon receipt of same will immediately provide these details to the OCS [Organized Crime Section] for incorporation into their Title III Affidavit.

As of 10/23/89, prospective Title III principals include the following Patriarca LCN Family members: Joseph "J.R." Russo, Consigliere, Vincent "Vinny" Ferrara, Capo and Robert "Bobby" Carrozza, Capo.

On 10/23/89, SSA Jim Ring telephonically advised the OCS that should it not be ultimately feasible to effect installation of emergency court ordered ELSUR, Boston will interrupt this meeting and effect arrests based upon complaints of subject Russo, Ferrara and Carrozza. These individuals, who are also subjects in the concurrent Boston "Jungle Mist" investigation (along with Patriarca LCN Soldier Anthony Mercurio) will subsequently be indicted in Boston pursuant to information already presented before the "Jungle Mist" Special Grand Jury.

Id. (emphasis added).

Maduro's teletype confirms three things with regard to Ring'sstate of mind on October 23, 1989. First, the warrant to conductroving electronic surveillance being sought was intended to beused only one time, to intercept "a" meeting. Id. Second, Ringexpected to know the location of that meeting soon enough toincorporate it in the application for electronic surveillance ifnecessary. Id. Third, Ring discussed having Russo, Ferrara, andCarrozza arrested, but intended to leave Mercurio free at leastuntil he was indicted. Id.

Steffens, however, was not given Maduro's teletype or theinformation that it contained. Steffens Aug. 10, 1998 Tr. at 9.Nor was Kottmyer then told that the FBI expected the ceremony tobe held on October 29, 1989 or that the FBI expected to be ableto identify the location of the ceremony before the applicationfor a warrant to bug it was filed. Kottmyer Aug. 12, 1998 Tr. at86-89, Aug. 13, 1998 Tr. at 139-40.

On October 25, 1989, Ring was away from Boston, attending anOrganized Crime conference. Ring June 4, 1998 Tr. at 63. SpecialAgent Robert Walthers served as Supervisor of the Organized Crimesquad in Ring's absence. June 8, 1998 Tr. at 4-5. In thatcapacity, he wrote a memorandum for Steffens to carry to FBIHeadquarters with his affidavit. Id. at 6-7. It stated, inpertinent part that:

The enclosed application/affidavit for "roving" Title III coverage of RUSSO, FERRARA, and CARROZZA has been drafted with the goal of obtaining authorization to direct electronic surveillance techniques at any meeting site utilized by the these subjects; such tactics are deemed necessary to counter the LCN's practice of meeting at various and changing locations. Such authorization will also help to protect the identity of any confidential sources, who otherwise might be revealed if singular information (in this case, the location of sensitive LCN meeting) provided by the source was incorporated into the affidavit of a traditional Title III application.

Ex. 164 (emphasis added).

This memorandum makes explicit that, contrary to this court'sfinding in Ferrara, 771 F. Supp. at 1279, one motive, if not thesole motive, for seeking authorization for a roving bug was adetermination not to risk revealing the FBI's sources ofinformation concerning the induction ceremony. Although thismemorandum was maintained in the files of the FBI's BostonOffice, it was not produced during the Ferrara litigation. Norwas it produced in this case until after the court issued its May22, 1997 decision granting defendants' motion for an evidentiaryhearing on the motion to suppress the electronic surveillance of34 Guild Street, and noted its prior finding that the failure ofthe government to make the full and complete statement requiredby § 2518(11)(a) "was not motivated by the desire to protect theidentity of any informant." Salemme, 978 F. Supp. at 356 (citingFerrara, 771 F. Supp. at 1279). Rather, the government producedthe October 25, 1989 Walthers memorandum on June 3, 1997 andacknowledged that it should have been disclosed in 1991, in theFerrara litigation. June 3, 1997 Tr. at 10; June 19, 1997 Orderat 8 n. 4.

On October 25, 1989, Steffens delivered the package ofdocuments to Moody, the head of the FBI's Organized CrimeSection, Steffens Aug. 6, 1998 Tr. at 49. Moody told Steffensthat the Boston Officewas going to have to add information to the affidavit that mightreveal that Mercurio was an informant. Id. at 49-51. Moody wasevidently referring to information regarding the location to bebugged when Mercurio furnished it. Steffens, however, disagreed.Id. He explained that because the targets were using variousand changing locations, this would not be necessary. Id. Hefelt that Moody did not understand the roving statute. Id.Steffens, however, was wrong.

On October 26, 1989, Mercurio again told Ring that theinduction ceremony would be held on October 29, 1989, in thevicinity of Wellington Circle, Medford, and that Federico wasscheduled to attend. Ex. 161; Ring June 4, 1998 Tr. at 85-88.Kottmyer was told that day that the ceremony would be held onOctober 29, 1989, near Wellington Circle. Kottmyer Aug. 12, 1998Tr. at 87-88, Aug. 13, 1998 Tr. at 141. She was not told Federicowas expected to be there. Aug. 13, 1998 Tr. at 141.

As indicated earlier, on October 25, 1989, it was agreed thatSullivan could review Mercurio's informant file on certainconditions. Ex. 168. That review was conducted on October 26,1989. June 6, 1998 Tr. at 8-9 (Under Seal). In the course of thatreview, Ring told Sullivan and Kottmyer that Mercurio had notbeen promised that he would not be prosecuted. Id.

As the review she had demanded had occurred, there was fromKottmyer's perspective no longer any impediment to pursuingindictments of Russo, Mercurio, and their colleagues. KottmyerAug. 12, 1998 Tr. at 73-76. Thus, on October 27, 1989 Kottmyersent Ahearn a memorandum. June 6, 1998 Tr. at 9 (Under Seal);June 15, 1998 Tr. at 20-21; Kottmyer Aug. 12, 1998 Tr. at 73-76,Aug. 13, 1998 Tr. at 95. Kottmyer wrote that indictments againstthe current leadership of the LCN would be returned in the nearfuture. Id. Therefore, as previously discussed, Mercurio'sstatus as an informant would have to cease when he or any of hisputative codefendants were arrested. Id. Kottmyer directed theFBI to tell Mercurio that he should not contact the Bureau exceptto report a threat of violence or a planned obstruction ofjustice. Kottmyer Aug. 13, 1998 Tr. at 95-98. Kottmyer understoodthat these principles had been generally discussed with Mercuriopreviously and that the FBI would soon implement them. Id.

In addition, Kottmyer wrote that, "[i]n accordance with Bureaupolicy, all contacts between informant and FBI will be documentedso that a full and complete record of the relationship betweenthe informant and the Bureau exists." June 15, 1998 Tr. at 20-21(Under Seal). This policy was not, however, followed with regardto Mercurio, either before or after Kottmyer's October 27, 1989memorandum.

Knowing that Federico was scheduled to attend the October 29,1989 induction ceremony, Delamontaigne caused one of the FBI'semployees, George Hurley, to obtain Federico's furloughapplication. Hurley Aug. 17, 1998 Tr. at 19. By the early morningof October 27, 1989, Ring had received and reviewed thatapplication. Ring June 19, 1998 Tr. at 64-65; Steffens Aug. 6,1998 Tr. at 54-55; Ex. 205. The application indicated that onOctober 29, 1989, Federico was planning to go to 34 Guild Street,Medford, which was near Wellington Circle. Ex. 205. Ring knewthat prior surveillances had shown that Federico had gone to thedestination listed on his furlough application in the past. RingJune 5, 1998 Tr. at 16-17; Kottmyer Aug. 12, 1998 Tr. at 182.

Accordingly, Ring sent several agents to conduct surveillanceof that address. Ring June 5, 1998 Tr. at 17; Steffens Aug. 6,1998 Tr. at 54. He also told Kottmyer that Federico's furloughapplication listed 34 Guild Street as his destination. KottmyerAug. 12, 1998 Tr. at 110.

On the morning of October 27, 1989, knowing that it was Fridayand there was a great deal of information to review, Kottmyerprovided a draft of the application and Steffens affidavit toDistrict Judge David S. Nelson. Kottmyer Aug. 13, 1998 Tr. at 95.However, at about the same time, a major impediment to proceedingwith the application arose. Ring June 4, 1998 Tr. at 65-78, June5, 1998 Tr. at 29-30, 45; June 22, 1998 Tr. at 57-60.

By the morning of October 27, 1989, Ring had informed theOrganized Crime Section at FBI Headquarters that he intended toarrest Russo, Ferrara, and Carrozza at the conclusion of theforthcoming induction ceremony. Id. at 68. Ring and hiscolleagues believed that immediate arrests were important toavert a repetition of violence comparable to the Salemme shootingand to eliminate the risk of flight. Ring June 4, 1998 Tr. at 68,June 15, 1998 Tr. at 165; Ex. 183. As the head of the OrganizedCrime Section, however, Moody was concerned that those arrestswould result in the prompt disclosure of the Steffens affidavitand, therefore, revelation of the ongoing electronic surveillancebeing conducted in Connecticut. Id. Moody was unwilling tojeopardize the electronic surveillance in Connecticut. Id.Thus, he refused to provide his required approval for theapplication for the Boston warrant unless Ring abandoned his planto make immediate arrests. Id. Later that morning, Ringreluctantly acquiesced in this demand. Id. As a result, Ringexpected that the FBI and Department of Justice would soonauthorize the application for the warrant for a roving bug. RingJune 5, 1998 Tr. at 45.

On October 30, 1989, Ahearn wrote to the Director of the FBIabout the dispute with Moody. Ex. 183. Among other things, Ahearnstated that:

In the [October 27, 1989 telephone calls], Section Chief MOODY advised SAC, Boston that the New Haven Division objected to the arrest plan, in that it could expose their wire. MOODY then advised that Boston would have to "compromise," and could either effect the arrests, or make the interceptions, but the affidavits would not be approved if Boston insisted on the arrests. MOODY was informed that Acting Strike Force Chief DIANE KOTTMYER, whose office also covers the New Haven Division, had discussed New Haven's concern, and both she and the Strike Force Attorney responsible for New Haven's interception were confident that a protective order could be secured to prevent any disclosure for at least six months.

The Bureau had an outstanding opportunity for the first time ever, of overhearing and recording an LCN induction ceremony, which would be invaluable for years to come at other LCN trials and Congressional Hearings. Forced to choose, SAC, Boston decided that he would delay arrests and proceed with the interception which, if accomplished, could have a major effect on the Bureau's national strategy against the LCN. Faced with this unfortunate, and avoidable dilemma, SAC, Boston informed FBIHQ that responsibility for injury or death to any individuals, either LCN members or innocent citizens, rested entirely on the shoulders of FBIHQ.

Id. This memorandum was written because on October 30, 1989,Ring and his colleagues were still seeking authority fromHeadquarters to make arrests as soon as possible. Ring June 19,1998 Tr. at 57. As it indicates, on and after October 27, 1989,neither Ring nor Ahearn wished to delay arrests in an attempt toconduct additional electronic surveillance after the inductionceremony was intercepted.

At about 12:50 p.m. on October 27, 1989, several FBI agentsobserved Russo, Ferrara, and Mercurio arrive at 34 Guild Street,with a person who proved to be its owner, Stephen DiStefano.Steffens Aug. 10, 1998 Tr. at 76. They promptly reported this toSteffens and Ring. Id., Aug. 6, 1998 Tr at 54-55; Ring June 4,1998 Tr. at 136-37, June 5, 1998 Tr. at 18-19, 21. Thesurveillance agents were excited. Steffens Aug. 6, 1998 Tr. at54-55. Steffens alsounderstood that the information was significant, in part becauseSteffens knew that Federico was expected to be at the ceremonyand had stated that he would be at 34 Guild Street on the morningof October 29, 1989. Steffens Aug. 6, 1998 Tr. at 54, 57. Ringtold Kottmyer about the observations at 34 Guild Street by about2:00 p.m. on October 27, 1989. Kottmyer Aug. 12, 1998 Tr. at 111.

After leaving 34 Guild Street, Mercurio returned to thevicinity of Vanessa's and called Ring. Ring Sept. 22, 1998 Tr. at131; Mercurio Aug. 4, 1998 Tr. at 29-30. Ring memorialized theirconversation in a 209, which stated:

On 10/27/89, [Mercurio] advised that VINNIE FEDERICO will go to 34 Guild Street, Medford, the residence of his brother-in-law, on Sunday 10/29/89, and that the LCN making ceremony will take place at the location around 11:00 a.m. FEDERICO's brother-in-law and sister will vacate the house on Saturday afternoon as the sister knows nothing about the use of the house but the brother-in-law does.

Ex. 161; Ring June 4, 1998 Tr. at 138-39. Mercurio told Ring thathe was "sure" that the ceremony would be held at 34 Guild Street.Mercurio Aug. 14, 1998 Tr. at 100. Ring told Mercurio that theFBI had observed him at 34 Guild Street. Mercurio Aug. 4, 1998Tr. at 30, Aug. 5, 1998 Tr. at 54-55.

Neither Kottmyer nor Steffens was told on October 27, 1989 thatMercurio had spoken to Ring or that he had provided additionalinformation identifying the location of the induction ceremony.Kottmyer Aug. 12, 1998 Tr. at 114; Steffens Aug. 6, 1998 Tr. at100; Ring June 19, 1998 Tr. at 74. Thus, neither Kottmyer norSteffens knew before applying for the warrant for a roving bugthat Mercurio had confirmed that the induction ceremony would beheld at 34 Guild Street. Id. at 114, 116. In essence, Ringprovided Kottmyer with relevant information from other sources,particularly Federico's furlough application and the surveillanceof 34 Guild Street, but did not share with her before theapplication for a roving bug was filed the information providedby Mercurio that strongly reinforced the fact that on theafternoon of October 27, 1989, it was practical to specify thelocation that would be bugged to achieve the FBI's sole goal —the interception of the induction ceremony. Id. The failure toprovide this information to Kottmyer prevented her fromconsidering on a fully informed basis whether it continued to belegally permissible to omit any reference to the ceremony fromthe application, which had not yet been approved by theDepartment of Justice or formally submitted to the court.

On the afternoon of October 27, 1989, it was not too late torevise the documents that had been submitted for approval to FBIHeadquarters and the Department of Justice. At times, theDepartment of Justice "had compressed the entire normal reviewprocess into a few hours in appropriate situations." Ex. HHHH;Kottmyer Aug. 14, 1998 Tr. at 169. Moreover, Kottmyer had faxedchanges in proposed applications to the Department of Justice inthe past. Id. at 71. She knew that she could always faxproposed changes to the Department. Id. at 91.

In the late afternoon of October 27, 1989, Connolly, who hadbeen out of town on business, returned to Boston. Ex. 249. Afterclosing Vanessa's at 5:00 p.m., Mercurio met Connolly and Ring ina hotel room. Mercurio Aug. 4, 1998 Tr. at 33; Kottmyer Aug. 14,1998 Tr. at 160-62. They spoke for twenty to thirty minutes.Mercurio Aug. 4, 1998 Tr. at 38, Aug. 5, 1998 Tr. at 93. Mercurioreaffirmed that the ceremony was a "definite go" for 34 GuildStreet, on October 29, 1989. Mercurio Aug. 4, 1998 Tr. at 36. AsRing testified, Mercurio was not asked if he would wear a deviceto record the ceremony or testify about it. Ring June 19, 1998Tr. at 94-95, Sept. 22, 1998 Tr. at 136-37. Contrary to FBIpolicy and practice, neither Ring nor Connolly prepared a 209 oranyother written record of this meeting with Mercurio.

Mercurio understood from his conversation with Ring andConnolly that the FBI would try to bug the ceremony. MercurioAug. 5, 1998 Tr. at 94. He thought that this would be difficultbecause he expected that Russo or Ferrara would be at 34 GuildStreet after the DiStefanos left. Id.

Late in the afternoon of October 27, 1989, Kottmyer received byfax the approval of the Department of Justice to submit herapplication for a roving bug to Judge Nelson. Kottmyer Aug. 14,1998 Tr. at 71. She and Steffens met with the judge, who enteredthe government's proposed order at 6:25 p.m. on October 27, 1989.Ex. 204 (Under Seal).

As previously described, at the time that the applicationincorporating Steffens' affidavit was formally filed, it was notaccurate for the government to represent that it was"impractical" to identify the location where the proposed bugwould be employed. The government had substantial, reliable,corroborated information indicating that the ceremony would beheld at 34 Guild Street and no information that the ceremonywould be held any place else in Massachusetts. Kottmyer Aug. 12,1998 Tr. at 174.

Kottmyer testified that if she had been fully informed of theinformation Mercurio had previously provided to Ring, and was notconcerned about singularity, she would have filed an applicationfor a conventional warrant for 34 Guild Street and anotherapplication for a warrant authorizing a roving bug. Kottmyer Aug.14, 1998 Tr. at 177-79. As described earlier, concerns aboutsingularity do not justify a failure to make the full andcomplete statement required by § 2518(11)(a)(ii). If, however,two applications had been filed, the judge would have beenproperly presented with the issue of whether, in thecircumstances, the issuance of anything more than a conventionalwarrant to bug 34 Guild Street was appropriate. See18 U.S.C. § 2518(3) (1994) ("[T]he judge may enter an ex parte order, asrequested or as modified. . .").

As indicated earlier, the judge was not informed that thewarrant he was being asked to issue would be used to intercept aforthcoming Mafia induction ceremony, in which at least one FBIinformant would participate. Thus, he was deprived of theopportunity to question whether any form of court orderedelectronic surveillance was really necessary at all. See18 U.S.C. § 2518(2) (1994) ("The judge may require the applicant tofurnish additional testimony or documentary evidence in supportof the application.").

On the afternoon of Saturday, October 28, 1989, surveillanceagents observed the DiStefanos pack their suitcases in their carand leave home, as Mercurio had said they would. Kottmyer Aug.12, 1998 Tr. at 172-75, Aug. 14, 1998 Tr. at 9-10. The warrantthat had been issued required that, if possible, Kottmyer informthe judge in advance of any surreptitious entry. Ex. 204. Thus,after the DiStefanos departed it was necessary for Ring topersuade Kottmyer to attempt to reach the judge to inform himthat a bug was going to be installed. Id. at 130-31, 174; Ex.204. Accordingly, on the afternoon of October 28, 1989, Ring toldKottmyer about his discussions and meeting with Mercurio the daybefore. Kottmyer Aug. 12, 1998 Tr. at 130-31. More specifically,Ring then told Kottmyer for the first time that Mercurio had theday before identified 34 Guild Street as the location for theceremony. Kottmyer Aug. 12, 1998 Tr. at 115-16, 130. Ringcharacterized this information as "rock solid." Id. at 130. Asindicated earlier, this information could and should have beenshared with Kottmyer on the afternoon of October 27, 1989.

Kottmyer tried unsuccessfully on Saturday, October 28, 1989, toreach the judge. Id. at 64. The entry and necessaryinstallation at 34 Guild Street was made that evening. Ring June5, 1998 Tr. at 102-03. Kottmyer eventually spoke to the judge onthe morning of Sunday, October 29, 1989, and told him that theentry had been made. Kottmyer Aug. 12, 1998 Tr. at 64.

On October 29, 1989, events developed precisely as Mercurio hadsaid they would. Mercurio drove some of the participants fromWellington Circle to 34 Guild Street. Mercurio Aug. 4, 1998 Tr.at 126. There, Federico, DeLuca, Floramo, and Tortora wereinducted as members of the Patriarca Family. Ex. 203 (UnderSeal). As Kottmyer explained in her report to the judge:

Interception of oral communications at [34 Guild Street] commenced at 9:47 a.m., October 29, 1989, after Vincent M. Ferrara and Joseph A. Russo were observed entering the house. Interception was terminated at 4:32 p.m. when Ferrara and Russo were observed leaving the house. The recorded communications memorialize a meeting of approximately seventeen known members of the Patriarca Family of La Cosa Nostra ("LCN") held for the purpose of inducting or "baptizing" four additional individuals into the Patriarca Family. In addition to Russo, Ferrara and Carrozza, the following Patriarca Family members were present: Raymond J. Patriarca, Matthew L. Gulielmetti, Jr. and Pasquale Gallea from Providence, Rhode Island; Louis Failla and Dominic "Slats" Marangelli from Connecticut; Gaetano Milano from Springfield, Massachusetts; and a number of LCN members from the Boston area, including Biagio Digiacomo and Charles Quintina.

The intercepted communications establish that Patriarca is the Boss of the Patriarca Family, Russo is Consigliere to the Family and Ferrara, Carrozza, Guglielmetti, DiGiacomo, and Quintina are Capo Regimes. Following introductory remarks by Patriarca in which he referred to past "problems" which he stated that he and Russo had resolved, individual ceremonies were held at which Vincent Federico, Robert DeLuca, Carmen Tortora and Richard Floramo were "baptized" as Soldiers in the Family. Each took an oath swearing, among other things, that he would abide by "omerta," the code of silence. On at least two occasions, the inductee promised to kill without hesitation any police informant posing a threat to the Family, even if the informant were his son or brother. During the ceremony, each inductee was required to identify the finger with which he pulls "the trigger" which was then apparently cut to draw blood for use in the ritual.

Following the induction, an explication of some of the rules of La Cosa Nostra was given by Russo, Ferrara, DiGiacomo and others. Among the rules discussed was each Soldier's obligation to obey his Capo Regime and his obligation not to disclose that he was a "Friend of Ours," i.e., a member of La Cosa Nostra, to another person unless that person had been formally introduced to him by another member as a "Friend of Ours." Russo instructed each inductee that in the event of a disagreement with his Capo Regime, he should bring the matter to the attention of Russo who, as Consigliere, would render a decision.

Id. Thus, as Ahearn characterized it the next day, "[t]heBureau . . . for the first time ever, . . . overhear[d] andrecord[ed] an LCN induction ceremony, which would be invaluablefor years to come at other LCN trials and CongressionalHearings." Ex. 183.

On the evening of October 29, 1989, Mercurio called Ring. RingJune 15, 1998 Tr. at 154-55. There had been a television on forpart of the ceremony, which interfered with the bug's ability torecord clearly what was being said. Ex. 203. Mercurio told Ringthat he had turned the television down. Id. at 163. Ringunderstood that Mercurio was indicating that he knew that theceremony was bugged and had tried to facilitate the recording ofit. Id. Ring knew that if he acknowledged that he was awarethat the television had been turned down, he would be confirmingthat the ceremony had been bugged. Id. at 148. Ring also knewthat if he confirmed that the ceremony had been bugged, Mercuriowould understand that his indictment was imminent and would flee.Id. at 149. Nevertheless, Ring told Mercurio that he was awarethat Mercurio had turned the television down, and admonished himnot to mention the matter to anyone else because it couldjeopardize Mercurio's safety. Id. at 148-49.

At some time prior to November 17, 1989, possibly in theOctober 29, 1989 telephone conversation with Ring, Mercurio was,as directed by Kottmyer, also told not to contact the FBI againexcept to report a threat of violence or an effort to obstructjustice. Ex. 169. This too signaled to Mercurio that it was timeto "disappear." Mercurio Aug. 5, 1998 Tr. at 127.

At the end of their conversation on October 29, 1989, Ringbelieved that Mercurio was saying goodbye and that he would nothear from Mercurio again. Ring June 15, 1998 Tr. at 147-48, June22, 1998 Tr. at 66. Ring, however, prepared no 209 or otherwritten record of that conversation. Ring June 15, 1998 Tr. at154; Ex. 161. Nor did Ring then initiate any efforts to findMercurio. Ring June 22, 1998 Tr. at 66.

On October 30, 1989, Mercurio spoke to Connolly. Mercurio Aug.4, 1998 Tr. at 40, Aug. 5, 1998 Tr. at 75. In response to aquestion, Connolly confirmed that Mercurio had been tracked byairplane while driving to 34 Guild Street. Id. Mercurio andConnolly also discussed the television being turned down. Id.Following his conversation with Connolly, Mercurio left Boston inan effort to "lay low." Mercurio Aug. 4, 1998 Tr. at 135, Aug. 5,1998 Tr. at 78.

Mercurio's departure from Boston at about the time of Flemmi'sreturn from Asia on October 31, 1989, causes the court to doubtFlemmi's claim that Mercurio told him that the FBI had tippedMercurio off to his imminent indictment. Flemmi Sept. 1, 1998 Tr.at 24-25. If Flemmi were aware that this occurred, it is morelikely that he and Bulger were told by Connolly. Id.; FlemmiAff., Apr. 27, 1998. In any event, the court concludes thatMercurio was alerted by the FBI that it was time for him to acton his previously expressed intention to become a fugitive, andhe did so.

Although they had frequently requested meetings in the past,neither Ring nor Connolly sought to meet with Mercurio afterOctober 29, 1989. Mercurio Aug. 4, 1998 Tr. at 143, 156. However,between October 30 and November 14, 1989, the FBI was able tocontact Mercurio by leaving messages at Vanessa's. Mercurio Aug.4, 1998 Tr. at 136. On November 10, 1989, Mercurio told Ring thatRusso and Ferrara had returned to Boston from Atlantic City. Ex.161; Ring June 15, 1998 Tr. at 153.

On November 13, 1989, Mercurio told Ring that Russo, Ferrara,and Carrozza were all in the Boston area. Ex. 161; Ring June 15,1998 Tr. at 151. Mercurio, however, was not in Massachusetts.Mercurio Aug. 4, 1998 Tr. at 57. Nor did Ring expect him to be inMassachusetts because Ring knew that Mercurio would not stayaround to be arrested. Ring June 15, 1998 Tr. at 152.

After the conversation on November 13, 1989, a memorandum thatwas reviewed, if not written, by Ring was sent to FBIHeadquarters, stating that:

Based upon previous review by the Boston Division PLA and discussion with the Boston Division Organized Crime Strike Force Chief, Boston is closing contact with [Mercurio] effective 11/13/89.

This informant has been instructed to initiate no further contact with the FBI unless a) there is a threat to life or physical well being; b) information as to corruption of the judicial process. Any contact for these limited purposes will be with other than the primary contact or alternate contact agent.

Ex. 169; Ring June 9, 1998 Tr. at 50-51.

Like Ring, Kottmyer knew that Mercurio was not in Boston inmid-November1989. On November 14, 1989, after consultation with Ring,Kottmyer obtained from a magistrate complaints authorizing thearrest of Russo, Ferrara, Carrozza, Mercurio, and Lepore. Ex.201. She understood at the time, however, that Mercurio andLepore could not then be located. Id.

In fact, Connolly and Ring could have contacted Mercurio bycalling Vanessa's. Mercurio Aug. 4, 1998 Tr. at 136. Mercurio hadalways returned Connolly's calls, and met with him and Ringwhenever asked. Mercurio Aug. 5, 1998 Tr. at 135. The FBI,however, made no effort to contact, meet with, or arrestMercurio. Ring June 22, 1998 Tr. at 64-66. Ring establishedseparate teams to arrest Russo, Ferrara, and Carrozza. Ring June15, 1998 Tr. at 165-66, June 22, 1998 Tr. at 64-66. No team wasestablished to try to find and arrest Mercurio, who was then inFlorida. Id.; Mercurio Aug. 5, 1998 Tr. at 81.

On November 13, 1989, Judge Nelson was advised that Russo,Ferrara, and Carrozza would soon be arrested and, therefore,there would be no further effort to employ the roving bug he hadauthorized. Kottmyer Aug. 14, 1998 Tr. at 20; Ex. 203. In fact,consistent with the FBI's original intent, there had been nogenuine effort to do so after the induction ceremony wasintercepted on October 29, 1989.

Accordingly, Mercurio received the benefit of his bargain withthe FBI — an opportunity to become a fugitive. Because Mercuriowas not present for the proceedings concerning his codefendants,the FBI and the government did not in the Russo case have tograpple with the vexing issues arising from Mercurio's service asan informant about which — as the instant case vividlydemonstrates — Kottmyer had been so correctly concerned.

31. Mercurio as a Fugitive

The conduct of the FBI concerning Mercurio when he was afugitive is instructive with regard to Flemmi's claim that Bulgerand he were informed of the imminent indictment in this case sothat they could flee. Indeed, it is important to understandingthe relationship between Quinn and Connolly, which is relevant tothat claim.

On November 16, 1989, Russo, Mercurio, and others wereinitially indicted. See Ferrara, 771 F. Supp. at 1281. Theoriginal indictment did not include any reference to the October29, 1989 induction ceremony and, therefore, presented no threatof prematurely disclosing the continuing electronic surveillancebeing conducted in Connecticut. Id. On March 22, 1990, asuperceding indictment was returned which included chargesrelating to that ceremony. Id.

A fugitive investigation concerning Mercurio, and a relatedfile, were opened shortly after November 16, 1989. Carter. Aug.17, 1998 Tr. at 67. Carter, the case agent for the Russoprosecution, was in charge of the Mercurio fugitiveinvestigation. Id. at 67; Quinn Aug. 19, 1998 Tr. at 16-17.Carter knew that Mercurio was an informant who had providedimportant information that led to the interception of the Mafiainduction ceremony at 34 Guild Street. Carter Aug. 17, 1998 Tr.at 58. He also knew that Connolly and Ring were Mercurio'shandlers. Id. at 65.

Carter and Connolly were "close friends" as well as colleagues.Id. Nevertheless, Carter did not ask Connolly to help him findMercurio. Id. at 94-95. Connolly and Ring told Carter that theydid not know where Mercurio was. Id. at 143. They did not tellCarter that they had always been able to contact Mercurio throughVanessa's or that he had attended meetings whenever asked to doso. Id. at 69-70.

After becoming a fugitive, Mercurio called Connolly everyseveral months. Mercurio Aug. 4, 1998 Tr. at 60, 63, Sept. 16,1998 Tr. at 86. This practice continued after Connolly retiredfrom the FBI in December 1990. Id. The fact that Mercuriowas calling Connolly would have been significant information forCarter to receive. Carter Aug. 17, 1998 Tr. at 144. Connolly,however, never told Carter about Mercurio's calls. Id. at 71,144.

It appears that Connolly also did not tell Carter's supervisorsthat he was in contact with Mercurio. Quinn Aug. 19, 1998 Tr. at28. Ring retired from the FBI in the summer of 1990. Ring June 4,1998 Tr. at 45. He was succeeded as the supervisor of theOrganized Crime squad by Quinn, who served in that capacity forthe next five years. Quinn Aug. 19, 1998 Tr. at 9. Quinn andConnolly had worked together for more than fifteen years andwere, according to Quinn, also "close friends." Id. at 14-15.Connolly should have told his supervisors about Mercurio's calls.Ring June 19, 1998 Tr. at 105. Quinn and Ring each testified,however, that Connolly did not tell them that Connolly wasspeaking to Mercurio during the time that Mercurio was afugitive. Id.; Quinn Aug. 19, 1998 Tr. at 28.

In 1991, the FBI, the DEA, and other agencies were conducting ajoint drug investigation of Mercurio's brother Michael, AnthonyD'Amore, and others. Hobbs Aug. 11, 1998 Tr. at 13. Special AgentJoseph Hobbs was the lead FBI agent in the joint investigation.Michael Cunniff was his DEA counterpart.

On July 3, 1991, Sonny Mercurio also became a target of thejoint investigation. Ex. 199; Cuniff Aug. 11, 1998 Tr. at 11, 28.More specifically, an investigation targeting him was then openedbecause Ronald Jacobson, a reliable cooperating witness, hadreported that Sonny Mercurio, Michael Mercurio, and others wereplanning to smuggle in excess of 2000 kilograms of marijuana intoMassachusetts. Ex. 199. On July 4, 1991, it was further reportedthat Sonny Mercurio was in Massachusetts, but was planning to goto California to purchase marijuana and drive it back toMassachusetts. Ex. 208; Cuniff Aug. 11, 1998 Tr. 11, 28. All ofthis information was provided to Hobbs, who knew that SonnyMercurio was a fugitive. Cuniff Aug. 11, 1998 Tr. at 21-22; HobbsAug. 11, 1998 Tr. at 13.

On July 4, 1991, Jacobson attended a barbecue at MichaelMercurio's home in Woburn, Massachusetts. Ex. 256; Hobbs Aug. 11,1998 Tr. at 26-27, 33-34, 29-30, 43. Sonny Mercurio was present.Mercurio Sept. 16, 1998 Tr. at 78. Immediately after thebarbecue, Jacobson met with Hobbs and reported that:

CW [Jacobson] was at a party given by MICHAEL MERCURIO at 30 Squanto Road, Woburn, MA on July 4, 1991. While attending the party, CW was told by MICHAEL MERCURIO and ANTHONY DAMORE that "SONNY" MERCURIO was in the house. CW was later pointed out to an individual and told that was Sonny. CW described this individual as having short crew-cut cropped gray hair, bushy eyebrows, white/gray mustache, heavy set. CW stated SONNY was with an individual named RICHIE (LNU), who had served some time with Sonny in the past. RICHIE (LNU) had three sons who were also at the party.

CW learned from ANTHONY DAMORE and MICHAEL MERCURIO that Sunday July 7, 1991, a boat was going to be rented or charted and leave from the wharf where the Marriott is located. There was going to be an all day long party on the boat which would be leaving around 9:45 a.m. SONNY, MICHAEL, DAMORE and others would be on the boat, along with several "girls."56

Ex. 256.57

On July 5, 1991, Quinn, who was then the supervisor of theOrganized Crime squad, received two important reports concerningMercurio. More specifically, Quinn received a telephone call fromanother FBI agent who reported information that he had justreceived from an informant Quinn knew to be reliable. Quinn Aug.19, 1998 Tr. at 23-31. Quinn was told that Salemme58 andothers in the LCN had determined that Mercurio was an FBIinformant and the source for the bugging of 34 Guild Street, inpart because an unidentified FBI agent had disclosed this to anunnamed fireman. Id. Therefore, it was expected that Mercuriowould be killed if Salemme or his associates could find him.Id.

Quinn knew that Mercurio was an informant who was instrumentalto the bugging of 34 Guild Street. Id. at 17-19. He regardedthe threat to Mercurio as a serious and urgent matter. Id. at33, 116.

In addition, on July 5, 1991, Hobbs gave Quinn and Carter theinformation about Sonny Mercurio that he had received fromJacobson the day before. Hobbs Aug. 11, 1998 Tr. at 34-39; QuinnAug. 19, 1998 Tr. at 40-43; Carter Aug. 17, 1998 Tr. at 74-83,94. Carter told Hobbs, among other things, that an attempt toarrest Mercurio at the wharf would be made on July 7, 1991. HobbsAug. 11, 1998 Tr. at 73, 90. Hobbs told Cuniff that the FBI'sOrganized Crime squad would make that effort and pursue any otherleads relating to Sonny Mercurio. Cuniff Aug. 11, 1998 Tr. at 23,31.

Carter understood that the individual named "Richie" who waswith Mercurio on July 4, 1991 was Richard Floramo. Carter Aug.17, 1998 Tr. at 81-82. Quinn undoubtedly understood this as well.As Floramo had been made a member of the Patriarca Family onOctober 29, 1989, Quinn would also have recognized that becauseFloramo knew where Mercurio was on July 4, 1989, Mercurio mightbe in imminent danger of being killed.

If standard practice and procedure had been followed, Quinnwould have immediately told Carter about the information that hehad received concerning the threat to Mercurio's life. Quinn Aug.19, 1998 Tr. at 44-45; Carter Aug. 17, 1998 Tr. at 50, 61.Ordinarily, it would have been Carter's responsibility to try towarn Mercurio by telling his family about the threat. Id. Quinndid not, however, tell Carter about the information regarding thethreat to Mercurio. Carter Aug. 19, 1998 Tr. at 55-57, 60-61;Quinn Aug. 19, 1998 Tr. at 135.

Instead, Quinn called Connolly. Quinn Aug. 19, 1998 Tr. at 21.Quinn told Connolly that Salemme and others had determined thatMercurio was an FBI source for the interception of the Mafiainduction ceremony, in part because an FBI agent had disclosedthis to a fireman. Quinn Aug. 19, 1998 Tr. at 50-52. Among otherthings, common sense compels the court to conclude that Quinnalso told Connolly thatit had been reliably reported that Mercurio was then in theBoston area, was known to be planning to get on a boat near theMarriott on July 7, 1991, and, therefore, was in particulardanger. Quinn asked Connolly to find a way to inform Mercurio ofthe situation. Id. at 28, 50-52. Connolly said that he wouldcontact Frank Pagano, a friend of the Mercurio brothers, and askhim to convey the message promptly to Michael Mercurio. Id.

Quinn made no written record of his discussion with Connolly.Id. at 163. Nor did he ever tell Carter about it. Carter Aug.17, 1998 Tr. at 66-67, 145.

Quinn expected that if Sonny Mercurio received the messagebeing sent to him through Connolly, he would leave Bostonimmediately. Quinn Aug. 19, 1998 Tr. at 54, 56, 117-18, 121.Thus, Mercurio would not, as previously planned, be at the wharffor the boat trip on July 7, 1991. Id. Quinn's expectation wasaccurate.

Mercurio promptly received Connolly's message. On July 6, 1991,Michael Mercurio told D'Amore that he had received a call from a"friend," evidently Pagano, who had warned him that the "feds"knew that his brother was in the Boston area. D'Amore Oct. 1,1998 Tr. at 85-86, 141-43, 151-52. As a result, Michael Mercuriosaid Sonny Mercurio had to leave town immediately. Id. at 86.Sonny Mercurio did leave Boston and went to California. MercurioSept. 16, 1998 Tr. at 80. As he testified, Mercurio "got word"from "somebody" that an agent had said that if he talked toMercurio he should tell him that Mercurio was on Salemme's "hitlist" and was going "to get himself killed." Mercurio Aug. 4,1998 Tr. at 62. Mercurio called Connolly to discuss this. Id.at 62-63. Connolly confirmed that Mercurio's life was in danger.Id.

On July 7, 1991, Carter led a team of FBI agents to the wharfwhere it had been reported that Mercurio was planning to be.Carter Aug. 17, 1998 Tr. at 83, 94; Quinn Aug. 19, 1998 Tr. at44. Typically, as the supervisor of the Organized Crime squad,Quinn would have been present if it were expected that a fugitivemight be arrested. Quinn Aug. 19, 1998 Tr. at 56. Quinn did not,however, join Carter on July 7, 1991. Id.

Carter and his colleagues observed Michael Mercurio at thewharf on July 7, 1991. Carter Aug. 17, 1998 Tr. at 83-84. SonnyMercurio, however, was not there. Id. Carter reported this toQuinn and Hobbs. Carter Aug. 17, 1998 Tr. at 47; Hobbs Aug. 11,1998 Tr. at 42. Although a written record of this surveillanceshould have been made, none was prepared. Id. at 62; Quinn Aug.19, 1998 Tr. at 59-60; Carter Aug. 17, 1998 Tr. at 88.

Quinn subsequently spoke to the agent whose informant had onJuly 5, 1991 reported the threat to Mercurio's life. Quinn Aug.19, 1998 Tr. at 89-91. As a result, on July 24, 1991, an entrywas made in the informant's file which stated that, "[s]ourcefurnished information concerning LCN knowledge of subject'sidentity as source for FBI and planned hit saving source's life."Id. at 123. The informant was told that Mercurio was planningto go on a boat, but did not because of the information he hadprovided and, as a result, Mercurio's life had been saved. Id.at 124. Carter, however, was never given this information. CarterAug. 17, 1998 Tr. at 69-70, 72, 122, 124, 126.

Following July 7, 1991, there were several obvious avenues ofinvestigation that were not pursued as part of the Mercuriofugitive investigation. Although Mercurio was known to have beenat his brother's home in Woburn on July 4, 1991, no surveillanceof that location was conducted. Quinn Aug. 19, 1998 Tr. at 63.Nor was Jacobson interviewed as part of the Mercurio fugitiveinvestigation. Id. at 64. Similarly, the information that theFBI had indicating that Mercurio would be in Los Angeles inconnection with the contemplated marijuana deal should havecaused Carter to contact the FBI's Los Angeles office, but thiswas not done. Id.at 72, 152; Ex. 209. However, the marijuana delivery to Jacobsonthat had been planned to occur shortly after July 4, 1991, whichCuniff hoped would result in Sonny Mercurio's arrest andprosecution, was never made. Cuniff Aug. 11, 1998 Tr. at18-20.59

In August 1991, Carter heard a "rumor" that Mercurio's life wasin danger. Carter Aug. 17, 1998 Tr. at 50-51, 90, 123, Aug. 18,1998 Tr. at 90-91. Carter promptly approached Michael Mercurio toconvey that information and to ask him to encourage his brotherto turn himself in. Id. This effort was unavailing. Id.

Mercurio was eventually arrested in Georgia, on state drugcharges, in 1994. Mercurio Aug. 4, 1998 Tr. at 51-54. Soon after,he was visited by FBI agent Michael Buckley and a colleague.Id. Mercurio told them that if the state charges were notdismissed, he preferred to be sentenced in Georgia beforereturning to Boston to deal with the federal charges against him.Id. Buckley then gave Mercurio the telephone number of an FBIagent in Atlanta to call if Mercurio needed anything. Id.

Before returning to Boston, Mercurio, through his attorney,began negotiating a plea agreement concerning the federal chargesagainst him. See United States v. Mercurio, 89-CR-289-MLW,Government's Submission Concerning Sentencing (Sept. 6, 1996) at9. On July 31, 1995, after Mercurio had returned to Boston, thegovernment informed Magistrate Judge Lawrence Cohen, who washandling pretrial discovery matters, that Mercurio had served asan FBI informant and requested authority to disclose certainstatements previously made by Mercurio to him directly, ratherthan through his lawyers. Salemme, 978 F. Supp. at 357 n. 9. Themagistrate judge granted the request, and impounded the motionand Order. Id. Neither the magistrate judge nor the governmentinformed this court, to which Mercurio's case was assigned, ofthese matters or of Mercurio's status as an informant. Id.

FBI agents did, however, promptly meet with Mercurio. MercurioAug. 4, 1998 Tr. at 53-54. Mercurio said that he did not wantcopies of his statements to be provided to him or his attorney.Mercurio Aug. 5, 1999 Tr. at 99. Thus, the documents that wouldhave disclosed that Mercurio was an informant were not includedin the discovery provided to his attorney on August 1, 1995. SeeUnited States v. Mercurio, 89-CR-289-MLW Docket Entry No. 1187.

When Mercurio fled in 1989, he believed that if he were everapprehended, he would be dealt with more leniently than if he hadbeen arrested with his codefendants. Mercurio Aug. 5, 1998 Tr. at137-38. Mercurio was correct. Russo, Ferrara, Carrozza, Lepore,and Tortora received sentences of between thirteen and twenty-twoyears in prison. Carrozza, 807 F. Supp. at 158-59. Thegovernment, however, entered into a binding plea agreement withMercurio, pursuant to Fed. R.Crim.P. 11(e)(1)(C), and persuadedthe court to depart downward and impose the agreed-upon 110-monthsentence, which in accordance with the government's pleaagreement was to be served concurrently with Mercurio's Georgiasentence. Salemme, 978 F. Supp. at 357. Thus, in 1996, Mercurioreceived little, if any, punishment for his federal offenses,while his role as an informant, and its implications for thelegality of the bugging of 34 Guild Street, remained masked fromthis court.

32. The Investigation of Flemmi and Bulger

As indicated earlier, Ring retired in the summer of 1990. RingJune 4, 1998 Tr. at45. He was, in about November 1990, succeeded as the supervisorof the Organized Crime squad by Connolly's "close friend," Quinn.Quinn Aug. 19, 1998 Tr. at 9.

In about December 1990, Connolly retired on short notice. Exs.38, 39. By this time, Connolly had enjoyed a very successfulcareer as an FBI agent, based largely on his handling of TopEchelon informants, and at times received unusually favorabletreatment by the Bureau. For example, Ahearn successfully soughtto have FBI Headquarters make Connolly a Supervisory SpecialAgent even though he had not been recommended by the Career Boardfor promotion. Morris Apr. 27, 1998 Tr. at 143-48. This was, toMorris' knowledge, unprecedented. Id.

As a result of Connolly's retirement, Flemmi and Bulger wereadministratively closed as informants on December 3, 1990. Exs.38, 39. In a subsequent request for funds to reimburse Connollyfor certain expenses, Nick Gianturco, the Informant Coordinator,wrote that Flemmi had "furnished Boston Division [of the FBI]very valuable information through the years regarding LCNactivities." Ex. 44; Gianturco Jan. 20, 1998 Tr. at 156. The FBIdid not want to lose Flemmi and Bulger as sources and, therefore,reported to Headquarters when Connolly retired that "BostonDivision is considering options to reopen" each of them "in thefuture." Exs. 38, 39. Consistent with prior practice, Flemmi wasnot told that he had been closed as a source or that hisrelationship with the FBI had been altered. Flemmi Aug. 29, 1998Tr. at 33; Quinn Aug. 19, 1998 Tr. at 108-13; Ex. 92.

By 1992, however, the United States Attorney's Office had beguna grand jury investigation targeting Bulger and Flemmi, amongothers. Ex. 269. Agents from the Organized Crime squadparticipated in the investigation, including John Gamel, whoserved as the case agent. Quinn Aug. 19, 1998 Tr. at 107. Thegovernment has represented that five of the agents who testifiedbefore the grand jury — Quinn, Gamel, Steffens, Walther, andBuckley — knew that Bulger and Flemmi were informants. Oct. 31,1997 Letter to the court, ex parte and Under Seal;60United States v. Salemme, 1997 WL 810057, at *8 (D.Mass.Dec.29, 1997); Dec. 18, 1997 Tr. at 58-59. The government alsorepresented that Daly "knew that Bulger was an informant, but wasunaware that Flemmi was an informant at the time he testified."Oct. 31, 1997 Letter to the court, ex parte and Under Seal. Asdescribed previously, however, Daly had been told in 1979 thatFlemmi was an informant when the decision was made not to indicthim or Bulger in the race-fix case. In any event, the governmentrepresents that before testifying to the grand jury, Gamel hadreviewed Bulger's informant file, Buckley had reviewed Flemmi'sinformant file, and Walther had reviewed parts of both files.Id.

Although the FBI was participating in the investigation ofBulger and Flemmi, despite multiple requests, the Bureau refuseduntil the eve of their indictment to tell the United StatesAttorney or his assistants whether Bulger was ever an FBIinformant. Ex. 269; Gianturco Jan. 20, 1998 Tr. at 5-13. As withMercurio, the United States Attorney and his colleagues, who werenot called as witnesses, were evidently concerned about theimplications for their investigation if Bulger was, or had been,an FBI informant. These included the foreseeable issues ofimmunity and authorization now raised by Flemmi, whose status asan informant would have been revealed if Bulger's had beendisclosed.

More specifically, in February 1992, United States AttorneyWayne Budd and two of his top assistants, A. John Pappalardo andRobert Ullman, met with the SAC, Thomas Hughes, ASAC O'Callaghan,and Gianturco, the Informant Coordinator. Id. The prosecutorsasked for confirmation that Bulger was an informant and for anopportunity to review his file. Gianturco Jan. 20, 1998 Tr. at 7.They were told that pursuant to the Attorney General's Guidelinesand Bureau policy, the FBI would not confirm or deny Bulger'sstatus. Id. at 9. Budd and his colleagues indicated that theywould, like Kottmyer concerning Mercurio, seek relief from theDepartment of Justice. Id. Gianturco contacted the InformantSection at FBI Headquarters as part of an effort to combat thatrequest. Id. at 10.

Despite repeated attempts by the United States Attorney, therequests for information concerning Bulger's relationship withthe FBI were rebuffed until January 9, 1995, four days afterFlemmi's arrest, and the day before he and Bulger were indicted.Exs. 269, 271. Thus, in contrast to the Mercurio matter, the FBIsucceeded in the bureaucratic battle concerning theconfidentiality of Bulger and Flemmi's status as informants.

While the United States Attorney could not obtain informationthat he was seeking from the FBI, Connolly, who was no longeremployed by the Bureau, was able to monitor the progress of thegrand jury investigation and keep Bulger and Flemmi advisedconcerning it. Flemmi Aug. 21, 1998 Tr. at 103-09, Sept. 1, 1998Tr. at 126-28. Connolly knew that Bulger and Flemmi were targetsof the grand jury investigation and often discussed it with eachof them, particularly Bulger. Id. Among other things, Connollytold Bulger and Flemmi not to be concerned. Flemmi Aug. 21, 1998Tr. at 106-07.

Connolly, Bulger, and Flemmi also discussed the bugging of theRotary Variety Store, which was in the vicinity of the SouthBoston Liquor Mart that Flemmi and Bulger owned. Flemmi Aug. 20,1998 Tr. at 153, Aug. 24, 1998 Tr. at 34-43. Connolly also spokewith members of the Organized Crime squad about this matter.Id.

No FBI witness admitted to giving Connolly informationconcerning the investigation of Bulger and Flemmi. As describedearlier, however, Quinn ignored established procedures to provideConnolly rather than Carter highly confidential information thathe knew would prompt Mercurio's further flight and probablyfrustrate efforts to apprehend him, without making a record ofthat irregular, if not illegal, communication.

The evidence also indicates that Buckley provided Connollyconfidential information concerning Bulger and Flemmi afterConnolly had retired from the FBI. Buckley Sept. 23, 1998 Tr. at8-14, 22-28. Buckley too characterized Connolly as a "closefriend," as well a colleague for fourteen years. Id. at 8.Buckley acknowledged that in about 1993, he told Connolly thatWilliam Ierardi had accused Bulger and Flemmi of being involvedin the Blackfriars massacre, in which five or six people weremurdered, and later failed a polygraph examination on thissubject. Id. That information had not been publicly disclosed.Id. at 23.

The foregoing examples concerning Quinn and Buckley, amongother things, cause the court to conclude that Connolly'senduring relationships with members of the Organized Crime squadgave him access to some information concerning the ongoinginvestigation of Bulger and Flemmi. As explained below, thatinformation was at times not complete or fully reliable. However,Connolly used the information that he received to honor hispromise to protect the sources who had contributed so much to hissuccess.

Flemmi too continued to perform as an ally of the FBI,particularly with regard to its interest in Salemme, who hadbecome the Boss of the Patriarca Family. FlemmiAug. 20, 1998 Tr. at 150. For example, in about 1993, Connollyasked Flemmi if he could get the telephone numbers used by FrankSalemme's brother, Jack. Id. Flemmi made some inquiries andgave Connolly the information that he requested. Id. Buckleysubsequently gave Jack Salemme's telephone numbers to Steffens,who included them in a successful application for wiretapwarrants. Id. at 14-22; Steffens Sept. 18, 1998 Tr. at 90-115.

From 1992 to 1995, Flemmi spoke to Connolly "constantly"concerning the ongoing grand jury investigation. Flemmi Aug. 21,1998 Tr. at 104-06. In 1993, as a result of discussions withConnolly, among other things, Flemmi thought that he would soonbe indicted along with Joseph Yerardi. Id. at 103-09. Thus, heleft Boston in an effort to avoid being arrested. Id. Flemmiwas not, however, included in the Yerardi indictment and returnedto Boston. Id. at 105.

Flemmi did not in 1993 assert to Connolly or anybody else thatit was improper for the government generally, or the FBIparticularly, to target him because he had been granted immunityfrom prosecution. Id. at 103-09. Rather, his conduct isconsistent with the conclusion that he had been promised"protection," which included being tipped off to forthcomingcharges so that he could flee.

In addition to his direct contacts with Connolly, Flemmireceived frequent reports concerning the progress of the grandjury investigation from Bulger, who was in even more regularcontact with Connolly. Flemmi Sept. 1, 1998 Tr. at 121-36. Bulgerand Flemmi knew that the grand jury would, unless extended orsucceeded, expire in mid-September 1994, because severalwitnesses who had been held in contempt and been incarceratedexpected to be released in mid-September. Id. at 122, 124, Aug.21, 1998 Tr. at 56. In about August 1994, Bulger told Flemmi that"John says the indictment will be coming down." Id. at 127.See also id. at 122-23. The court concludes that Bulger wasthen referring to Connolly. Bulger told Flemmi that "it was timeto take a vacation." Id. at 121-24. Flemmi understood that hewas being advised to flee to avoid arrest and prosecution. Id.at 128. Thus, he went to Montreal for several months. Flemmi Aug.21, 1998 Tr. at 62.

Once again, Flemmi did not then say to Bulger, or anyone else,that they were immune from prosecution by virtue of theiragreement with the FBI. Id. at 129. Rather, Flemmi viewed thetip about his possible indictment as part of the protection thathe had been promised. Id. at 131.

In August 1994, Bulger also told Theresa Stanley, with whom hehad been romantically involved for thirty years, that they toowould take "a vacation." Stanley Sept. 17, 1998 Tr. at 83-84. OnAugust 29, 1994, they visited Graceland, Elvis Presley's home, inMemphis, Tennessee. Ex. 251; Stanley Sept. 18, 1998 Tr. at 14. Inthe next several months they also traveled to Dublin, London,Rome, and throughout the United States, including New York, NewOrleans, California, and the Grand Canyon. Stanley Sept. 17, 1998Tr. at 84-86, Sept. 18, 1998 Tr. at 14.

From September 1994 to January 1995, despite their distant anddisparate locations, Flemmi and Bulger were in frequent contactFlemmi Sept. 1, 1998 Tr. at 133. Their "beepers" permitted themto stay in close touch. Id. at 134. When they spoke, Bulgertold Flemmi that he was staying "on top of things." Id. at 135.Flemmi knew from their conversations that Bulger was continuingto get information concerning the possible indictment of them.Id. Bulger undertook to keep Flemmi up to date and did so.Id. at 135-36.

On October 25, 1994, the original indictment in this case wasreturned, against one defendant, Robert DeLuca. In five pages itcharged DeLuca with conspiring to violate the Travel Act,18 U.S.C. § 1952, and with a substantive violation of the statutebased upon his alleged attendanceat a Mafia induction ceremony held at 34 Guild Street, Medford,Massachusetts on October 29, 1989. At the government's request,the indictment was sealed and DeLuca did not immediately receivenotice of it. The timing of the indictment was evidentlyinfluenced by the fact that the five-year statute of limitationson the offenses charged was about to expire. See18 U.S.C. § 3282. The DeLuca case was randomly assigned pursuant to theDistrict Court's established procedures. It was drawn to thiscourt.

Bulger and Stanley returned to Boston prior to Christmas, 1994.Stanley Sept. 18, 1998 Tr. at 81. They stayed for a few daysbefore leaving for another "trip." Id.

By January 1995, Flemmi too had returned to Boston. About aweek before January 10, 1995, Flemmi received a telephone call,at his mother's home, from Bulger. Flemmi Aug. 20, 1998 Tr. at154-55, Aug. 21, 1998 Tr. at 82-85, Sept. 1, 1998 Tr. at 144-46,Sept. 2, 1998 Tr. at 107-08. Bulger told Flemmi that there was aprosecution memorandum that had been sent to Washington, D.C.,recommending their indictment. Flemmi Aug. 20, 1998 Tr. at154-55, Aug. 28, 1998 Tr. at 138, Sept. 1, 1998 Tr. at 145-46.Bulger said that he understood that they would be indicted inabout a week, or around January 10, 1995. Flemmi Aug. 20, 1998Tr. at 154-55, Aug. 21, 1998 Tr. at 83-84, Sept. 1, 1998 Tr. at144-46, Sept. 2, 1998 Tr. at 107-08.

Flemmi claims that in their telephone conversation Bulger saidthat he had received this tip from "Vino," meaning Morris. FlemmiAug. 20, 1998 Tr. at 154-55, Sept. 1, 1998 Tr. at 145. This claimis not credible. The relationship between Bulger and Morris waschilled by The Boston Globe 1988 article reporting that Bulgerwas an FBI source. According to Morris, he met with Bulger andFlemmi shortly after that article was published and did not speakwith Bulger again until Bulger called him angrily in October1995. Morris Apr. 28, 1998 Tr. at 87-88, Apr. 29, 1998 Tr. at140-41.

At some point during Morris' tenure as the supervisor of theOrganized Crime squad, Connolly told him that what Flemmi andBulger wanted from their relationship with the FBI was a "headstart." Morris Apr. 22, 1998 Tr. at 80-82, 85-86. Morris did notobject to this arrangement. Id. at 87-90, 96-97. The courtconcludes that in early January 1995, Connolly, who remainedclose to Flemmi and, particularly, Bulger, had been monitoringthe grand jury investigation in part through his contacts in theFBI, and was in constant communication with Bulger and Flemmiabout the investigation, was the source of the tip to Bulgerconcerning the indictments expected to be returned on or aboutJanuary 10, 1995.

The information Bulger received and shared with Flemmi wasaccurate, but from Flemmi's perspective materially incomplete andmisleading. In early January 1995, indictments charging him andBulger were scheduled to be returned on January 9 or 10, 1995.Ex. 271. Being told this on about January 3, 1995, evidentlylulled Flemmi into believing he did not need to flee immediately.Flemmi apparently did not realize, however, that by not leavingpromptly he ran the risk of being arrested on a complaint beforehe was indicted — the procedure that had been used to captureRusso, Ferrara, and Carrozza because of the government'swell-founded concern about leaks that would prompt the putativedefendants to flee before the then forthcoming indictments wereissued. Flemmi Sept. 1, 1998 Tr. at 145; Ex. 201.

On January 5, 1995, Flemmi was arrested on a criminal complaintcharging him, Bulger, and Kaufman with conspiring to extort abookmaker, Burton Krantz. Crim. Compl. No. 95-M0001-LPC, Jan. 4,1995. Flemmi Sept. 1, 1998 Tr. at 145. Flemmi felt he had beenarrested "prematurely," before he "even had a chance toexercise [his] feelings" and flee. Flemmi Aug. 28, 1998 Tr. at138.

When Flemmi was arrested, Bulger and Stanley were driving backto Boston. Stanley Sept. 18, 1998 Tr. at 16-21, 85. Stanley hadtold Bulger that she wanted to go home. Id. Bulger was planningto drop her off and leave again. Id. While in Connecticut,Bulger and Stanley heard on the car radio that Flemmi had beenarrested. Id. Bulger turned around immediately and went to NewYork. Id.

In anticipation of the imminent indictment of Bulger, on orabout December 22, 1994, the United States Attorney's officeagain asked the FBI whether he was an informant because it wasanticipated that the government would soon have to discloseexculpatory information to Bulger and his codefendants. Ex. 269.The Boston office of the FBI did not wish to comply with thisrequest.

In seeking support for its continued resistance to telling theUnited States Attorney whether Bulger was an informant:

On December 28, 1994, the Boston Division of the FBI expressed the view to FBI Headquarters that there was no reasonable expectation that [Bulger] or his co-defendants would raise the issue of his former informant status, nor was there any evidence to suggest that if issues concerning the informant's prior cooperation were raised that the presiding judge would not accept affidavits submitted by the Boston Division's Principal Legal Advisor or a representative from the FBI's Legal Counsel Division.

Id. The fact that Bulger and Flemmi were about to be alerted totheir imminent indictments and thus provided an opportunity toflee suggests that the view that the issue of Bulger's, andimplicitly Flemmi's, informant status would not be raised mayhave been premised, in part, on the expectation that they, likeMercurio, would not be present to participate in the proceedingsinvolving their codefendants. In any event, in late December1994, the FBI in Boston believed that even if asked, no judgewould compel the disclosure of Bulger and Flemmi's relationshipwith the FBI.

Nevertheless, the FBI's Principal Legal Adviser in Boston, JohnMichael Callahan, was on January 3, 1995 directed by RichardSwensen, the SAC, to review the Bulger and Flemmi informant filesfor possible exculpatory information. Ex. 271. As Callahan wrote,in a January 10, 1995 memorandum that was not shared with theUnited States Attorney's office:

On 1/3/95, SAC SWENSEN instructed the PLA to contact AUSA JAMES FARMER and obtain copies of a 250-page prosecution memo and an 85-page indictment concerning captioned individuals and other organized crime subjects. Moreover, SAC instructed the PLA to obtain guidance from AUSA FARMER with respect to reviewing the files pertaining to captioned individuals. The purpose of the proposed file reviews was to determine whether or not the informant files pertaining to captioned persons contained information which might include Brady material. If Brady material were located, the SAC intended to give consideration to disclosing the identities of captioned individuals to the U.S. Attorney's Office because of the fact that their indictment was imminent. It should be noted that the SAC had not admitted that captioned persons were informants at this point and had not confirmed the existence of pertinent informant files.

On 1/4/95, PLA contacted AUSA JAMES FARMER and was informed that in addition to carefully reviewing the prosecution memo and the indictment, which would be provided, he suggested that the PLA examine any files that might be relevant, to determine if any persons named in the proposed indictment had received any authorization to commit any of the crimes set forth in the proposed indictment by or from any FBI Agent. Moreover, he advised that the files should be reviewed to determine whether or not there were any express or implied promises to any of the prospective indictees from the FBI which would have included assurances that anything any of them told the FBI would not be used against them. Finally, he suggested that the review focus on whether or not any of the proposed indictees had provided information to the FBI which would undercut a central theme of the indictment, namely, that there was a close working relationship between La Cosa Nostra (LCN) and the Winter Hill Gang. AUSA Farmer asked that the file reviews commence immediately due to the fact that arrests were expected in the case early in the following week and the Grand Jury was expected to return an indictment against several organized crime figures early in the following week.

Id.61 (emphasis added).

In essence, Farmer, who was a supervisor of the prosecutorsprimarily responsible for this case, had recognized thepotentially important issues of whether Bulger and Flemmi wereauthorized to commit the acts being presented to the grand juryas criminal, whether they had been expressly or implicitlypromised use or transactional immunity, and whether theirpossible service as informants was inconsistent with theexistence of the enterprise to be alleged in this case — acriminal cartel consisting of members of the LCN and of theWinter Hill Gang. These are serious questions which, despite thegovernment's opposition, contributed to this court's decision tocompel disclosure of Bulger's history as an FBI informant.Salemme, 978 F. Supp. at 346-47, 353-54.

Callahan went on to write that:

AUSA FARMER sent a copy of the prosecution memo and the indictment to the PLA and both of these documents were reviewed on January 4, 1995. On January 5, 6, and 9, 1995, the PLA reviewed the informant files pertaining to [Flemmi and Bulger]. Each file was reviewed in its entirety. These file reviews disclosed numerous informant reports from both informants in which information was provided against LCN members. Some of the information furnished by both informants was used in at least six Title III affidavits for electronic surveillance against the Mafia. In addition, the PLA discovered some serials, primarily in the files pertaining to [Flemmi] which pertain to information which clearly reflected that this informant was engaged in illegal gambling activity at a very high level within the Winter Hill Gang. Moreover, it showed that this informant had a close working relationship with the LCN in making policy decisions regarding illegal gambling in the Boston area, which both the Winter Hill group and the LCN agreed to abide by. The serials disclosing this kind of information were dated in the middle 1980's. Similar information from this informant was also found in the file prior to 1970. The information in the file prior to 1970 indicated that this informant told the FBI that he was engaged in illegal gambling activities and other illegal activity of a non-violent nature. In one instance, source advised that he was involved in administering a severe beating to an organized crime figure who had stepped out of line. Because these serials were in [Flemmi's] file, there was a clear indication that FBI Agents were aware of his involvement in illegal activity (primarily illegal gambling activity) and at least had tacitly authorized his participation in such activity. Nowhere in the files pertaining to [Flemmi] was there any express authorization to commit criminal activity from any FBI Agent.

There was also a small number of serials in the informant files pertaining to [Bulger] from which an inference could be drawn that he was also involved in illegal gambling activities. The inference was less clear in the case of [Bulger] because he never placed himself actually in the criminal activity. Nonetheless, he reported on certain illegal gambling activity by the Winter Hill group and from this, an inference can be drawn that he was personally involved. This is true because it was well known that this informant was one of the leaders of the Winter Hill group during the time these reports were made.

Ex. 271 (emphasis added).

Thus, as John Coffey, the Chief of the Organized Crime andRacketeering Section of the Criminal Division of the Departmentof Justice later advised a magistrate judge, four days afterFlemmi was arrested, "Callahan had concluded that Flemmi'scontrol agents were obviously aware over the years from whatFlemmi reported that he was engaged in illegal gambling and inLCN policy making" and "(by receiving this information and notarresting Flemmi) at least tacitly authorized (his)participation." Aff. of Paul E. Coffey, Esq., Nov. 13, 1995("Coffey Aff., Nov. 13, 1995"), at 4 n. 1; Salemme, 978 F. Supp.at 354, n. 6.

As Callahan also wrote on January 10, 1995:

Upon completion of the file reviews, this information was brought to the attention of the SAC, ASAC O'CALLAGHAN, and SSA EDWARD M. QUINN. Upon being briefed by the PLA regarding the information discovered, SAC SWENSEN made a decision to disclose the identities of captioned informants to the U.S. Attorney because of the likelihood that the information discovered was indeed Brady material that could not be withheld from the U.S. Attorney's Office. Failure to disclose this material to the U.S. Attorney could wreck the proposed organized crime indictments which were scheduled to be returned on January 9, or January 10, 1995.

On January 9, 1995, SAC SWENSEN, ASAC O'CALLAGHAN, SSA QUINN, and the PLA attended a meeting in the U.S. Attorney's Office with U.S. ATTORNEY DONALD STERN, AUSA JAMES FARMER, and AUSA JONATHAN CHIEL. During that meeting, the SAC disclosed to the three representatives of the U.S. Attorney's Office the identity of the two captioned informants [Flemmi and Bulger] and requested that their identities not be disclosed beyond the three individuals in the room plus one representative of their selection from their office who would pursue the matter further with the PLA. The U.S. Attorney, on behalf of the other two AUSAs, agreed to this request. The SAC then instructed SSA QUINN, and the PLA to give the representatives from the U.S. Attorney's office a quick general overview of the kind of information discovered during the PLA's file review. This was done in a general way and no specific information was provided. The U.S. Attorney requests that the PLA be available at some future time to discuss the kind of specific information that he learned through the file reviews with a designated AUSA who is not involved in the prosecution or decision making regarding the prospective indictments. SAC SWENSEN agreed to make the PLA available for this purpose.

Ex. 271 (emphasis added).

In striking contrast to Kottmyer's conduct concerning Mercurio,in 1994 the United States Attorney, Stern, did not insist thatthe prosecutors presenting the case, or indeed anyone outside ofthe FBI, review the Bulger and Flemmi informant files beforeindictments were sought. Id.Stern's decision to insulate the prosecutors handling the casefrom even the limited information that he had received wasevidently based on the concern Farmer had previously expressedabout possible promises to Bulger and Flemmi that theirstatements and/or evidence that they helped obtain would not beused against them, and the foreseeable possible claim that theprosecutors' disqualification would be required if they wereexposed to evidence provided pursuant to a promise of immunity.

The information concerning Bulger and Flemmi that Stern and hiscolleagues received on January 9, 1995, did not cause them evento pause in their pursuit of indictments against Bulger andFlemmi. Rather, the proposed indictments that had been preparedand approved previously were presented to the grand jury the nextday by prosecutors who "did not know that Bulger and Flemmi hadbeen informants or of any assessment of the information in theirinformant files." Ex. 269.

It would be almost seven months before any member of the UnitedStates Attorney's Office would ask to review Flemmi and Bulger'sinformant files. Id. When made, that request was promptlygranted. Id.

33. The Indictment of Bulger and Flemmi and Its Aftermath

On January 10, 1995, the government obtained a ninety-one pagesuperceding indictment of the earlier charges against DeLuca. TheFirst Superceding Indictment (the "1SI") added six defendants —Bulger, Flemmi, George Kaufman, Francis P. Salemme, Francis P.Salemme, Jr., and James Martorano. The First SupercedingIndictment also radically altered the charges in the case. Thenew charges included, among others, an alleged RICO conspiracylasting more than thirty years and a lengthy conspiracy to extortbookmakers and drug dealers. DeLuca was named in only a fractionof the alleged racketeering acts and substantive charges.

The new charges against DeLuca and his codefendants could havebeen brought as a separate indictment, which would have beenrandomly assigned to a member of the District Court. However, asthose charges were brought in a superceding indictment in anexisting case, they were, in accordance with the District Court'sstandard and well-known practice, assigned to this court. Thus,the government exercised what was in effect an option offered bythe District Court's procedures to select this court to presidein this case against Bulger, Flemmi, and the other defendantsadded to the original DeLuca case.

The First Superceding Indictment charged the defendants with,among other things, from 1969 to January 1995, engaging in aconspiracy to violate, and violating, the RICO statute,18 U.S.C. § 1961 et seq. (1994). See 1SI Counts 1 and 2. They were alsocharged with conspiring to extort, and extorting, bookmakers,from 1979 to 1994. See 1SI, Counts 3-17.

With regard to the RICO charges, the alleged enterprise wasneither the Patriarca Family of La Cosa Nostra nor the WinterHill Gang, organizations that have, in effect, been proven to beRICO enterprises in prior prosecutions. See, e.g., United Statesv. Angiulo, 897 F.2d 1169, 1175 (1st Cir. 1990) (PatriarcaFamily); United States v. Angiulo, 847 F.2d 956, 960, 969-70(1st Cir. 1988) (Patriarca Family); United States v. Winter,663 F.2d 1120, 1127-28 (1st Cir. 1981) (Winter Hill Gang).Rather, the defendants were alleged to have been part of a uniqueassociation-in-fact enterprise made up of individuals who joinedtogether to use their respective relationships with either thePatriarca Family or the Winter Hill Gang to, among other things,facilitate the unlawful activities of the enterprise andcoordinate the activities of the Patriarca Family and the WinterHill Gang. 1SI, ¶ 1(k); Feb. 14, 1997 Bill of Particulars; Nov.15, 1995 Government's Response toMagistrate Judge Cohen's Order dated Aug. 23, 1995, filed exparte and Under Seal, at 4.

In view of Bulger and Flemmi's roles as Top Echelon informantsutilized to provide and, in some instances tasked to obtain,information for the FBI concerning the LCN, there are seriousissues presented concerning whether they were authorized toengage in the conduct alleged to be criminal and are, therefore,not guilty as charged. See United States v. Baptista-Rodriguez,17 F.3d 1354, 1368 n. 18 (11th Cir. 1994), cert. denied, 119S.Ct. 2365 (1999); United States v. Johnson, 139 F.3d 1359,1365-66 (11th Cir. 1998), cert. denied, ___ U.S. ___, 119 S.Ct.2365, 144 L.Ed.2d 770 (1999); United States v. Light,64 F.3d 660, 1995 WL 507241 at *2 (4th Cir. Aug. 28, 1995); UnitedStates v. Achter, 52 F.3d 753, 755 (8th Cir. 1995). There arealso questions relevant to all of the defendants regardingwhether the conspiracies and enterprise alleged in the FirstSuperceding Indictment genuinely existed because an agreementwith someone acting as an agent of law enforcement is not acriminal conspiracy. See Salemme, 978 F. Supp. at 353-54 (citingUnited States v. Duff, 76 F.3d 122, 127 (7th Cir. 1996) andUnited States v. Nason, 9 F.3d 155, 161 n. 2 (1st Cir. 1993)).As explained in § III.1.A, infra, however, these issues must beaddressed at trial. It is the question of immunity that the courtcan and must decide in these pretrial proceedings. Salemme,1997 WL 810057 at *1-3 (D.Mass. Dec.29, 1997).

On January 17, 1995, the magistrate judge conducted a detentionhearing concerning Flemmi. As Flemmi was leaving the courtroom hesaw Quinn. Flemmi Aug. 20, 1998 Tr. at 155, Aug. 21, 1998 Tr. at50-51. Flemmi knew that Quinn was aware of his valuable serviceas an informant concerning the LCN. Flemmi Aug. 20, 1998 Tr. at156-57. Flemmi thought that Quinn would at least do something tofacilitate his release on bail. Id. Thus, Flemmi said to Quinn,"How about a break on bail." Flemmi Aug. 20, 1998 Tr. at 155,Aug. 21, 1998 Tr. at 50-51. However, Assistant United StatesAttorney Kelly, who was with Quinn, told Flemmi that Quinn couldnot speak to him because Flemmi's attorney would object. FlemmiAug. 29, 1998 Tr. at 156-57.

After Bulger's indictment on January 10, 1995, the FBI opened afugitive investigation of him. Charles Gianturco was put incharge of it. Steffens Aug. 10, 1998 Tr. at 24; Walther Oct. 1,1998 Tr. at 166. He is the brother of Nick Gianturco, who, asdescribed earlier, understood that Bulger had helped save hislife when Gianturco was an undercover agent in Operation Lobster,and had subsequently dined and exchanged gifts with Bulger andFlemmi.

On about January 23, 1995, Bulger returned to the Boston areabriefly to drop off Stanley. Stanley Sept. 18, 1998 Tr. at 40-41,47, 84, 85. It was widely known that Stanley had been travelingwith Bulger and was back in Boston. Id. at 63. Yet the FBI didnot contact her until April 1996, about fifteen months after shehad returned. Id. at 42-43, 53; Walther Sept. 10, 1998 Tr. at166-67.

When approached, Stanley was cooperative. Among other things,she told FBI agents Charles Gianturco and Walther that duringtheir trip prior to his indictment Bulger had driven a GrandMarquis, used the alias "Tom Baxter," and stayed with the Matosfamily in Selden, New York, with whom she and Bulger had stayedbefore. Stanley Sept. 19, 1998 Tr. at 11-13. Stanley had not,however, heard from Bulger since he returned her to the Bostonarea. Id. at 48-54. Thus, by the time that she was interviewedby the FBI, the information that Stanley could provide was datedand of diminished value. Nevertheless, the FBI paid Stanley $1000in November 1996. Walther Sept. 10, 1998 Tr. at 169.

In late June 1995, Assistant United States Attorney StephenHeymann asked to review Bulger and Flemmi's FBI informantfiles. Ex. 269. He did so on July 3, 1995. Id. As a result, theUnited States Attorney's Office evidently decided that it wasessential that the prosecutors presenting the case be informedthat Bulger and Flemmi had been FBI informants. This was done atsome time prior to August 23, 1995. See Aug. 23, 1995Government's Ex Parte, In Camera Motion for Protective Order.

On August 1, 1995, the government obtained a Second SupercedingIndictment that added John Martorano as a defendant. As describedpreviously, John Martorano had, in 1979, become a fugitive fromRICO charges in the race-fix case against Winter, himself, andothers, which was, in effect, alleged to be a racketeering act ofa RICO enterprise known as the Winter Hill Gang. See Winter,663 F.2d at 1127-28. After he was apprehended, John Martorano'scase was assigned to District Judge Reginald Lindsay. On July 24,1995, over the government's objection, Judge Lindsay dismissedthe case against John Martorano, without prejudice, because aviolation of the Speedy Trial Act, 18 U.S.C. § 3161. Rather thanattempting to reinstate the dismissed charges, the governmentbrought new charges against Martorano in this case. Thus, thiscourt became responsible for presiding in the case against JohnMartorano.

On August 23, 1995, Assistant United States Attorney Herbertfiled, under seal, with Magistrate Judge Lawrence Cohen, theGovernment's Ex Parte, In Camera Motion for a Protective Orderconcerning documents to be produced in discovery to Flemmi andhis counsel. Herbert stated that Flemmi had made "potentiallyrelevant" statements to the FBI "in the context of a confidentialrelationship over the course of many years." Id. at 1. Herbertexplained that trial counsel had not read or been informed of thestatements in order to avoid any arguable claim that thestatements had been used improperly in investigating Flemmi.Id. at 2 n. 1. The government noted that Flemmi had notrequested his statements and, therefore, the government had noobligation to produce them pursuant to Fed.R.Crim.P. 16(a)(1)(A)or Rule 116.1 of the Local Rules of the United States DistrictCourt for the District of Massachusetts. Id. at 3. Thegovernment requested confirmation of this view. Id.

The government also represented that it recognized that it hadan independent and continuing obligation to produce exculpatoryinformation pursuant to Brady v. Maryland, 373 U.S. 83, 83S.Ct. 1194, 10 L.Ed.2d 215 (1963), and its progeny. Id. at 4 n.3. Thus, the government expressed the intention to have thedocuments reviewed by a senior official of the Department ofJustice "to determine whether they contain any information thatmust be disclosed to the defendant Flemmi or any of hiscodefendants on constitutional grounds." Id.

The motion concluded with the representation that, "if theCourt determines that the statements or their existence should bedisclosed to defendant Flemmi, the government would request anex parte conference with the Court on the record to determinethe proper mechanism for disclosure." Id. at 4-5.

In 1995, Flemmi did not realize that the FBI had memorialized,in writing, some of the statements he made to several of itsagents over more than twenty-five years. Flemmi Aug. 27, 1998 Tr.at 56; Morris Apr. 21, 1998 Tr. at 34. In any event, as set forthbelow, when the magistrate judge eventually ordered that certainof the 209s containing Flemmi's statements be provided to him,the government neither requested an ex parte conference todiscuss the appropriate procedure for disclosure nor produced thedocuments.

The magistrate judge responded to Herbert's August 23, 1995motion the same day. See Aug. 23, 1995 Order (Under Seal). Heagreed that Fed.R.Crim.P. 16(a)(1)(A) and Local Rule 116.1 didnot require immediate disclosure of Flemmi's statements. Id.Apparently assuming theoutcome of the government's proposed review, he gave thegovernment until October 20, 1995, to file an affidavitrepresenting that Flemmi's file contained no information subjectto disclosure before conviction under Brady. Id. Indeed, heopined that, "it appears highly unlikely — even from the vantagepoint of not having reviewed the matters sought to be protected —that the information protected herein is exculpatory as to thetrial stage of this case." Id. This was simply incorrect. See,e.g., Salemme, 978 F. Supp. at 353-54; United States v.Salemme, 978 F. Supp. 386, 386-87 (D.Mass. June 26, 1997). Themagistrate judge did, however, recognize that Flemmi's statementsas an informant would be relevant to his punishment if he pledguilty or were convicted. Id. To deal with this foreseeablepossible development, he ordered the prosecutors to seek guidancefrom him, rather than from this court, if either of those eventsoccurred. Id.

On September 15, 1995, this court conducted a hearing toaddress a number of pending matters. The court began the hearingby stating that: "There have been developments since I saw someof you in June of 1995, and I want to see if I have an accurateand complete understanding of where matters are." Sept. 15, 1995Tr. at 4. At the conclusion of the lengthy proceeding, the courtstated that: "I am going to take this [case] I think from JudgeCohen. There is nothing in front of him and I will just deal withit directly." Id. at 75. The prosecutors did not then, or laterex parte, inform this court that the magistrate judge had beenadvised that Flemmi was an informant and had established aschedule to deal with the implications of that fact himself.Rather, the government continued to address that issue with themagistrate judge, while this court dealt with all other mattersin this case.

More specifically, on or about October 20, 1995, the governmentresponded to the magistrate judge's August 23, 1995 Order byfiling an affidavit from Coffey and a related memorandum signedby Assistant United States Attorney James Rehnquist, who was nota member of the prosecution team. Aff. of James H. Herbert, Oct.22, 1997 ("Herbert Aff., Oct. 22, 1997").62 It was in thesesealed submissions that the government noted that Callahan hadconcluded in January 1995 that the FBI had "at least tacitlyauthorized [Flemmi's] participation" in "illegal gambling and LCNpolicymaking." Nov. 15, 1995 Government's Response to MagistrateJudge Cohen's Order Dated Aug. 23, 1995 at 6 n. 2; Coffey Aff.,Nov. 13, 1995, at 4 n. 1. Nevertheless, the governmentrepresented that Coffey had found that "very little in the Flemmiand Bulger files is even arguably Brady material." Government'sResponse at 7 (emphasis added).

In a sealed November 14, 1995 Order, the magistrate judgedirected the government to submit a proposed protective order forhim to enter. On December 12, 1995, he adopted the government'sproposal and entered an Order which stated, in part, that:

The government shall disclose to the defendant Stephen J. Flemmi Inserts 1-7 of the Appendix to the Affidavit of Paul E. Coffey, Esquire, previously filed. The government shall disclose those materials directly to the defendant Stephen J. Flemmi in person, without providing a copy of the same to his counsel, and without further notification to his counsel.

Dec. 12, 1995 Order (Under Seal). The magistrate judge also heldthat the government was not required to disclose any additionalinformation to Flemmi or his codefendants. Id.

The magistrate judge did, however, order that the matter ofFlemmi's status as an informant be brought to this court'sattention at least thirty days before trial. Id. At that time,this court had presided in cases against nine members of thePatriarca Family, each of which resulted in guilty pleas. SeeCarrozza, 807 F. Supp. at 157; United States v. Patriarca,776 F. Supp. 593 (D.Mass.), remanded, 948 F.2d 789 (1st Cir. 1991);DiGiacomo, 746 F. Supp. 1176. Thus, it was foreseeable that byvirtue of the December 12, 1995 Order, the government might neverbe required to disclose to this court that Flemmi had been an FBIinformant.

As indicated earlier, the government did not, as it hadpreviously represented, seek a hearing to determine how toimplement the magistrate judge's December 12, 1995 Order. Nor didit comply with the Order by providing Flemmi with the documentsthat the magistrate judge directed that he receive.

The three prosecutors primarily responsible for this case haverepresented that Assistant United States Attorney Rehnquist, whowas not on the prosecution team, had worked with Coffey in makingthe subsequent submissions to the magistrate judge and neitherRehnquist nor Coffey told the FBI about the Order. Herbert Aff.,Oct. 22, 1997. The government contends that the "FBI was waitingfor confirmation that the order had been issued before attemptingto make arrangements to deliver the documents to the defendantFlemmi." Id. Thus, Herbert represented that, "howeverregrettable the delay in complying with Magistrate Judge Cohen'sOrder of December 12, 1995, the failure to comply with the ordermore promptly was inadvertent rather than intentional." Id.

However, on June 21, 1996, Callahan wrote a memorandum recitingthe history of the submissions to the magistrate judge andstating that, "Judge Cohen ultimately ruled, with respect to thegovernment's request for instructions regarding its discoveryobligations, that the government only had to disclose certainlimited documents to meet its discovery obligations. . . ." Ex.272. Thus, it is evident that the FBI was well aware of themagistrate judge's December 12, 1995 Order and, with Coffey andRehnquist, simply ignored it.

Although Flemmi did not receive the documents that themagistrate judge ordered be furnished to him, he was anticipatingassistance from Connolly and the FBI. Flemmi Aug. 21, 1998 Tr. at46-47. This court reviewed Flemmi's detention and, on June 13,1995, again denied his request to be released on bail. See June13, 1995 Order. At that point, Flemmi asked Weeks to speak toConnolly about the assistance he had expected to receive. Id.at 40-52. Weeks reported to Flemmi that he had talked severaltimes to Connolly, who said that he was very upset that Bulgerand Flemmi had been indicted and that the FBI had evidentlyabandoned them. Id. at 40-41. Flemmi shared this view. Id. at42.

Nevertheless, Flemmi had faith that Bulger would "contactsomebody" and get their problems "squared away." Flemmi Aug. 20,1998 Tr. at 157-58, Aug. 21, 1998 Tr. at 21-22. Flemmi planned topersevere quietly until that occurred. Flemmi Aug. 20, 1998 Tr.at 158. He felt that he had been required to be a fugitive formore than four years before Rico succeeded in protecting him withregard to the charges concerning the Bennett murders and theFitzgerald bombing. Id. He intended to wait out this mattertoo, rather than reveal that he and Bulger had been informants,and thus endanger Bulger. Id. at 157-58.

As Flemmi expected, Bulger did attempt to get their problems"squared away." On October 13, 1995, Bulger called Morris. Ex.86; Morris Apr. 28, 1998 Tr. at 85, Apr. 29, 1998 Tr. at 30.Morris had by then been promoted to Chief of the TrainingAdministration Section of the FBI Academy at Quantico, Virginia,where Bulgercalled him. Morris Apr. 28, 1998 Tr. at 85.

Bulger reminded Morris that he had taken money from Bulger,asserted that he had witnesses, and "said that if he went tojail, he was taking [Morris] with him." Ex. 86; Apr. 28, 1998 Tr.at 88-90. Morris testified that Bulger demanded that Morris usehis "Machiavellian mind" to devise a story to tell The BostonGlobe to persuade its reporters that his previous statementsthat Bulger was an informant were not true. Id. Morris assertsthat Bulger did not ask him to do anything to resolve the chargesagainst him and Flemmi. Id. The court finds that thiscontention is not credible.

Morris prepared a 302 of his telephone conversation with Bulgerwhich he claims, falsely, was accurate and complete. Ex. 86;Morris Apr. 28, 1998 Tr. at 90, Apr. 29, 1998 Tr. at 32-33.Morris sent copies of the 302 to the Organized Crime Section andOffice of Professional Responsibility at FBI Headquarters, and toSwensen, the SAC in Boston. Morris Apr. 30 1998 Tr. at 196-97.

In the 302 Morris stated, in part, that Bulger had "accused[Morris] of accepting money from him and said that if went tojail, he was taking [Morris] with him. He claimed he hadwitnesses." Ex. 86. The 302 also contained Morris' rendition ofhis response, that this was "an outright lie." Id. Morrissubsequently received a telephone call from Gamel, who inquiredabout the Training Academy's capacity to track in-coming calls.Morris Apr. 30, 1998 Tr. at 91. However, prior to December 1997,when Morris made the proffer which persuaded the government togrant him immunity in the pending proceedings, the FBI neverasked Morris about Bulger's claim that he had made payments toMorris. Morris Apr. 28, 1998 Tr. at 91-92, Apr. 30, 1998 Tr. at198.

In any event, Bulger's call to Morris was unavailing. This casecontinued.

On May 21, 1996, the government obtained what it called a ThirdSuperceding Indictment (Docket No. 359), with two parts, one ofwhich included only the charges against John Martorano. Thegovernment characterized this as a "bifurcation" of the SecondSuperceding Indictment. Neither counsel nor the court wasfamiliar with any precedent for such a severance of charges by agrand jury within a single indictment. The court, therefore,deemed the charges against John Martorano to constitute aseparate indictment, and had it given a separate case number. Asmany motions in which John Martorano had joined were pending,with the consent of the parties, in the interest of efficiency,the court consolidated for pretrial purposes the case againstJohn Martorano and the case against his former codefendants. Jan.9, 1997 Tr. at 8-9.

In the Third Superceding Indictment (the "3SI"), Bulger andFlemmi were charged with participating in the race-fixing schemeas one of their alleged racketeering acts. (3SI, Count One, RA3). As described in § II.9, supra, this was the matter forwhich Connolly, Morris, Daly, and O'Sullivan decided, in 1979,that Bulger and Flemmi should not be charged in order to permitthem to assist in the FBI's important effort to bug Angiulo'sheadquarters at 98 Prince Street. As also described previously,Bulger and Flemmi made unique contributions to the ultimatesuccess of that effort.

At hearings in June 1996, the court indicated that motions todismiss the Third Superceding Indictment for failure to allegeproperly certain elements of a RICO offense, including thedescription of the alleged enterprise, might be meritorious. OnJuly 2, 1996, the government obtained a Fourth SupercedingIndictment, which was intended to cure the alleged defects inpleading. See Salemme, 978 F. Supp. at 346. The courtsubsequently conducted lengthy hearings on some of defendants'many remaining motions to dismiss and to suppress.

As of March 1997, the court had denied the defendants' motionto dismiss the Fourth Superceding Indictment and many of thealleged Racketeering Acts. See United States v. Salemme, 1997WL 37530, *1-6 (D.Mass. Jan.13, 1997). In doing so, however, thecourt emphasized the foreseeable difficulty the government mighthave in proving the enterprise alleged. More specifically:

After subsequent hearings, the court held that the Fourth Superseding Indictment adequately alleged the existence of an enterprise, but that the government would, among other things, have to prove that the alleged Enterprise had an ascertainable structure separate and apart from the pattern of racketeering activity in which it engaged. See United States v. Salemme, 1997 WL 37530, *1 (D.Mass. January 13, 1997). The court also held that, "`[t]he function of coordinating the commission of several different offenses and other activities on an on-going basis is adequate to satisfy the separate existence requirement.'" Id. (quoting United States v. Console, 13 F.3d 641, 651 (3rd Cir. 1993)).

The court did, however, order that the government submit a bill of particulars concerning the purported structure of the alleged Enterprise. Id. In response to that filing, the defendants have renewed their motion to dismiss.

Salemme, 978 F. Supp. at 346-47.

As of March 1997, the court had also orally announced itsdecision denying the motion to suppress certain electronicsurveillance conducted by the Massachusetts State Police,although the court found that the government had violated statelaw by obtaining the warrant authorizing that electronicsurveillance in the wrong county, Jan. 29, 1997 Tr. at 1-7, 26,and had not had the resulting tape recordings sealed in the timerequired by federal law. Feb. 18, 1998 Tr. at 3-52.

In addition, on several occasions the court informed theparties of its tentative decision to exclude the testimony ofHugh Shields and other evidence concerning the 1967 murders ofEdward, Walter, and William Bennett, and Richard Grasso, whichwere charged for the first time in the Third SupercedingIndictment as racketeering acts of Flemmi and Salemme, becausethe government had used the grand jury primarily or exclusivelyto obtain evidence to strengthen the RICO charges previouslyalleged by obtaining an immunity order, pursuant to18 U.S.C. § 6001 et seq., to compel the otherwise unavailable testimony oftwo witnesses essential to charging the murders as racketeeringacts and to strengthening the evidence of the alleged enterprise.See, e.g., Beasley, 550 F.2d at 266; Gibbons, 607 F.2d at1328; Santiago, 533 F.2d at 730.

This issue may have significant practical consequences for thiscase. If Flemmi and/or Salemme are convicted, but not heldaccountable at sentencing for any of the four murders, it appearsthat the Guideline ranges for their sentences may be reduced fromlife imprisonment to as little as ten to thirteen years forFlemmi and eight to ten years for Salemme. As the court has toldthe parties, however, its decision is tentative pending thepreparation and issuance of a written memorandum and order.

On March 21, 1997, Nick Gianturco and Steffens interviewedConnolly as part of the Bulger fugitive investigation. SteffensAug. 10, 1998 Tr. at 23, 25. Connolly said that he had not seenor heard from Bulger. Id. at 28; Ex. 222. In fact, according tothe 302 that Gianturco prepared, "Connolly stated that he has notseen or heard from Bulger since December of 1989." Ex. 222. Ifsaid by Connolly, this was untrue. If not said, the statement,which tends to exculpate Connolly with regard to any suggestionthat he had abetted Bulger's flight, should not have beenincluded in the 302 Gianturco prepared.

In any event, Connolly also told Gianturco and Steffens that hehad known Bulgersince they were both boys and Bulger had bought him an ice creamcone. Aug. 10, 1998 Tr. at 30. Connolly added that he hoped that"Bulger was never caught." Id. at 31. Connolly also said thatat a party at Morris' house, Morris was "in his cups" and toldFlemmi and Bulger "that they were so good, he could get them offfor anything short of murder." Id. at 31, 53, 149. Connollyalso indicated that he knew that Bulger had called Morris sincebecoming a fugitive. Id. at 32. This had not been publiclydisclosed at that time. Id. at 52.

Steffens regarded Connolly's statement that he hoped Bulgerwould not be caught as "startling." Id. at 33. However, it wasnot included in the 302 that Gianturco belatedly prepared on May7, 1997, and that Steffens reviewed. Id. at 26, 34; Ex. 222.Nor did the 302 include Connolly's report of Morris' statementthat he could get Bulger and Flemmi off for anything short ofmurder. Id. at 34; Ex. 222. Steffens did, however, tell one ofthe prosecutors, Kelly, about this statement. Steffens Aug. 10,1998 Tr. at 35, 151-52.

On March 21, 1997, before Connolly was interviewed, thedefendants moved for evidentiary hearings on their motions tosuppress certain electronic surveillance evidence, including theelectronic surveillance conducted jointly by the DEA-FBI in1984-85 and the FBI's 1989 34 Guild Street interceptions.63Steffens Aug. 10, 1998 Tr. at 22. In connection with thesemotions, each of the defendants, with the significant exceptionof Flemmi, moved for disclosure of whether Bulger, Mercurio,Robert Donati, a deceased, former close associate of Ferrara, andcertain other individuals were FBI informants; Flemmi joined inall of the motions except the request concerning Bulger. SeeSalemme, 978 F. Supp. at 350-51 & n. 3.

In the process of addressing these motions, the courtdiscovered for the first time the submissions made to themagistrate judge which disclosed that Bulger and Flemmi had beenFBI informants. Id. at 351 n. 3. Knowledge of Flemmi's statusprompted the court to seek and receive permission to question himprivately. Id.; Apr. 16, 1997 Tr. at 118-22 (Under Seal). As aresult, Flemmi immediately decided to disclose to his attorney,Kenneth Fishman, and his codefendants that he had been an FBIinformant. Id.64

Following a conference with the court in which Flemmi, Fishman,and Coffey participated, Coffey spoke briefly to Flemmi andFishman. Flemmi Aug. 24, 1998 Tr. at 50-54. Coffey told Flemmithat because of his past services to the government Coffey wouldlike to assist Flemmi, and requested his cooperation with thegovernment in the prosecution of the instant case. Id. Flemmiresponded by stating that, "[i]f I was so valuable to you,what am I doing being indicted," and the conversation ended.Id. at 53.

The government strenuously opposed the requests for evidentiaryhearings on the motions to suppress and the related request thatit be required to confirm or deny whether Bulger, Mercurio,and/or Donati were informants. Salemme, 978 F. Supp. at 345. Thecourt conducted a series of hearings, over several months, in aneffort to address the motions carefully. Id. Because themotions involved allegations that specified individuals hadsecretly served as informants, the court recognized that theyimplicated the generally recognized interest of the government inmaximizing the confidentiality of its sources to encourage thefree flow of information from informants and the interest ofparticular possible informants in their own safety. Id. Thus,at the request of the parties, the court temporarily sealed allof the submissions concerning the motions, received some exparte filings by the government, and conducted several hearingsthat were closed to the public. Id.

On May 22, 1997, the court issued its Memorandum and Orderfinding that the defendants were entitled to evidentiary hearingson their motion to suppress the electronic surveillance jointlyconducted in 1984 and 1985 by the DEA and FBI which targetedBulger and Flemmi, and the electronic surveillance conducted onOctober 29, 1989, at 34 Guild Street. Id. at 345, 363. Thecourt also ordered the government to disclose whether Bulger,Mercurio, and/or Donati were informants. The decision wastemporarily sealed to permit the government to decide whether toobtain the authorization of the Acting Deputy Attorney General,Seth Waxman, to comply with the Order, or to decide insteadeither to dismiss the case or to be held in civil contempt in aneffort to render the decision appealable. Id. at 346.

Prior to the unsealing of the May 22, 1997 Memorandum andOrder, the FBI announced for the first time that it was offeringa $250,000 reward for Bulger's capture. See Patricia Nealon,"FBI offers $250,000 for Whitey Bulger's arrest," The BostonGlobe, May 30, 1997, at B1. At the press conference announcingthe reward, the SAC, Barry Mawn, reportedly stated that he "wasvery satisfied that there was an all out effort by the Boston FBIto find Whitey Bulger" and that he wanted to "clear up anyperception that may exist that the FBI is not aggressivelypursuing [him]." Id.

At that point it was foreseeable that if the case was notdismissed by the government, Flemmi's history as an informantwould soon be disclosed publicly, and that Bulger's status as asource could be revealed by Flemmi and, in any event, easily beinferred because of their close association. In response to theMay 22, 1997 Memorandum and Order the government confirmed thatBulger had been an informant and, contrary to it previousposition, conceded that there was a proper basis for the court tohave ordered evidentiary hearings on the motions to suppresselectronic surveillance conducted in 1984-85 and at 34 GuildStreet. See United States v. Salemme, 978 F. Supp. 364, 365(D.Mass. June 6, 1997).

Demonstrating again the Department of Justice's traditionaldeference to the FBI in matters concerning the confidentiality ofits sources, however, the Acting Deputy Attorney General declinedto obey the Order to confirm or deny whether Mercurio and/orDonati were informants in connection with the electronicsurveillance at 34 Guild Street. Id. Rather, reconsideration ofthat Order was requested. Id. The May 22, 1997 Memorandum wasthen unsealed and public proceedings on these issues commenced.Id. at 366.

The motion to reconsider was denied. Id. The Acting DeputyAttorney General continued to decline to obey the direction todisclose the status of anyone other than Bulger. Id. Thedefendants moved to have him held in civil contempt andincarcerated. Id. at 365. The Acting DeputyAttorney General asked that the court instead enter an order ofconditional exclusion of the 34 Guild Street electronicsurveillance evidence so the government could attempt to appeal.See U.S. v. Salemme, 978 F. Supp. 375, 376 (D.Mass. June 13,1997). The court found, however, that the government had notsatisfied the requirements for a conditional order of exclusion.Id. at 376-77. The Acting Deputy Attorney General did notimmediately relent and, therefore, faced the risk of being heldin civil contempt and incarcerated until he complied with thecourt's Order.

However, in an effort to cut the Gordian Knot, the courtrequired Mercurio to appear to be questioned concerning whetherhe was an FBI informant when he attended the Mafia inductionceremony on October 29, 1989. Id. at 379. On June 18, 1997,Mercurio testified that he was cooperating with the government inconnection with that ceremony. United States v. Salemme,978 F. Supp. 379, 381 (D.Mass. June 19, 1997). In response to arenewed Order, id. at 385, the Acting Deputy Attorney Generalrevised his refusal to address the status of Donati andrepresented that he had not been an informant. United States v.Salemme, 978 F. Supp. 390, 391 (D.Mass. June 27, 1997). Thus, themotion to hold the Acting Deputy Attorney General in civilcontempt for failure to confirm or deny whether Mercurio and/orDonati was an informant was rendered moot. Id.

On June 25, 1997, Flemmi filed an affidavit intended to respondto certain representations made by the government concerning hisstatus as an informant. Ex. 92. Among other things, Flemmiasserted that Morris had told him and Bulger that they could beinvolved in any criminal activities short of murder and would beprotected by the FBI. Id. He also claimed that as part of hiscontinuing relationship with the FBI he was specifically informedof the date his indictment in this case was to be returned so hecould flee if he chose to do so. Id. Flemmi had previouslyasserted that in 1991 Mercurio had been given prior notice of hisindictment so he could flee. Ex. 213.

On June 26, 1997, the court ordered that the government producecertain documents and information which was relevant to theforthcoming evidentiary hearings on the motions to suppress andto Flemmi's charges. United States v. Salemme, 978 F. Supp. 386(D.Mass. June 26, 1997). The required discovery included, amongother things: virtually all of Flemmi's FBI informant file, id.at 387; the documents relied upon by FBI Special Agent JohnMichael Callahan, Chief Division Counsel for the Boston Divisionof the FBI, in concluding that "Flemmi's control agents wereobviously aware over the years from what Flemmi reported that hewas engaged in illegal gambling and in LCN policymaking" and thatsuch agents "`at least tacitly authorized [his] participation,'"id. (citations omitted); comparable records regarding Bulger,id.; and documents and information tending to show thatDepartment of Justice and/or FBI regulations or guidelines hadnot been complied with concerning Flemmi, Bulger, or Mercurio,id. at 387-88. The next day the government repeatedly objectedto the scope of the discovery order. See, e.g., June 27, 1997Tr. at 18, 20-21, 24, 28, 36. Generally, the objections wereoverruled. Id.; United States v. Salemme, 978 F. Supp. 386(D.Mass. June 26, 1997).

In late June 1997, the Attorney General established a taskforce of Department of Justice and FBI personnel to investigatethe allegations of misconduct raised by Flemmi and the motions tosuppress. That task force conducted its investigation in July andearly August 1997, and issued a confidential report to theAttorney General. With the agreement of the government, the courtreviewed the Executive Summary of that report and some of thedocuments that the investigation generated in order to decidecertain issues concerning discovery to be produced in connectionwith the motions to suppress. Sept. 12, 1997 Tr. at 14-16.

In August 1997, the government requested that the evidentiaryhearings on the motions to suppress not be conducted until thedefendants filed a notice, pursuant to Fed.R.Crim.P. 12.3(a)(1),of any intent that they had to assert a public authority defense,and motions to dismiss the Fourth Superceding Indictment based onclaims of immunity and other grounds. The government's motion wasgranted. Aug. 11, 1997 Order at ¶ 2.

On September 3, 1997, the defendants filed under seal theirmotion to dismiss, a sixty-three page memorandum, and twosupporting affidavits of Anthony Cardinale, Esq., who was thencounsel for Salemme and DeLuca. The grounds for the motion todismiss included the contentions that: the government had engagedin systematic, outrageous misconduct in connection with theinvestigation of this case and thus violated defendants' rightsto Due Process; dismissal was required as an exercise of thecourt's supervisory powers; there had been gross abuse by thegovernment in failing to inform the grand jury of Flemmi andBulger's status and activities as informants; that immunizedtestimony had been improperly presented to the grand jury; andillegally obtained electronic surveillance evidence had beenpresented to the grand jury. See Memorandum of Law in Supportof Defendants' Motion to Dismiss All Pending Indictments (Sept.2, 1997).

Cardinale's affidavit charged that Connolly had attempted tofoment violence by telling him in 1989 that Salemme was planningto kill his then client Ferrara. Aff. of Anthony Cardinale, Sept.3, 1997 ("Cardinale Aff., Sept. 3, 1997"). In addition, Flemmifiled a notice that as part of his defense he would assert thathe was authorized by the FBI to engage in the acts now charged ascrimes. Defendant Flemmi's Notice Under Fed.R.Crim.P. 12.3(Docket No. 696). The defendants submissions were, despite thegovernment's objection, unsealed on September 10, 1997. UnitedStates v. Salemme, 985 F. Supp. 193 (D.Mass. Sept.10, 1997).

On October 6, 1997, the defendants filed, under seal, aneighty-five page Factual Submission in Support of Defendants'Motion to Dismiss. This Factual Submission referenced andanalyzed information defendants had received in discovery. Thecourt did not grant the defendants' requests to unseal thisdocument. Oct. 6, 1997 Order.

On October 22, 1997, the government filed, under seal, aninety-nine page Opposition to Defendants' Motion to Dismiss AllPending Indictments, and attachments. The memorandum thoroughlyaddressed the law relating to virtually all of defendants' claimsexcept Flemmi's contention that he had been provided immunity.The theme of the government's submission was, in essence, thatthe defendants were not entitled to a pretrial evidentiaryhearing on their motion to dismiss and that their claims would attrial be proven to be unmeritorious.

Over the next several months, the court held a series ofhearings concerning the motions to dismiss and othermatters.65 The court expressed the view that the defendants'claim that the case should be dismissed because of outrageousmisconduct might not be viable as a matter of law, but theirsupervisory powers claim might be valid if certain facts wereproven. Oct. 29, 1997 Tr. at 45-46, 58.

The court also provided the parties with the opportunity tosupplement their submissions concerning Flemmi's suggestionthat the case against him be dismissed because he had beenpromised immunity. Flemmi confirmed that he was asserting animmunity defense. On December 15, 1997, the government filed alengthy memorandum opposing Flemmi's motion for an evidentiaryhearing on his motion to dismiss based on immunity. On December22, 1997, Flemmi filed another affidavit in support of hisimmunity claim. Ex. 31.

After additional hearings on December 18 and 23, 1997, thecourt granted Flemmi's motion for an evidentiary hearing on hismotion to dismiss based on immunity. See United States v.Salemme, 1997 WL 810057 at *1-3 (D.Mass. Dec.29, 1997). As theissues presented are integrally related, the court decided thatthe hearings on the motions to suppress and the motion to dismissbased on immunity would be conducted concurrently. Id. at *3.The court did not grant the defendants' request for anevidentiary hearing on the other grounds of their motions todismiss.

The evidentiary hearings began on January 6, 1998. On January20, 1998, they were suspended for three months while the courtaddressed and denied the government's suggestion that it bedisqualified, pursuant to 28 U.S.C. § 455(a), because, althoughthe government acknowledged that the court was actually unbiased,a reasonable person would question its impartiality. See Feb.13, 1998 and Mar. 30, 1998 Memoranda and Orders.

The testimony was completed on October 30, 1998. Thedocumentary record was completed on December 14, 1998. Severaldays of closing arguments were held. Nov. 12, 1998 Tr.; Nov. 16,1998 Tr.; Nov. 17, 1998 Tr.; Nov. 18, 1998 Tr.; Nov. 19, 1998Tr.; Nov. 20, 1998 Tr.; Nov. 23, 1998 Tr. In all, more than17,000 pages of transcripts were generated in the evidentiaryhearings. The parties' initial, voluminous post-hearingsubmissions were completed by January 29, 1999. The court orderedand received on April 6 and 30, 1999, additional, lengthymemoranda on certain electronic surveillance issues. Furtherhearings were held on April 13 and 14, 1999. Additionalsubmissions followed. As a result, more than 1000 pages of briefswere filed.

The findings of facts detailed in this Memorandum are based onthe direct and circumstantial evidence that this court found tobe credible. Implicit in those findings are decisions thatcontradictory evidence was not credible. There is, however, onewitness whose testimony deserves further reference.

Over the defendants' objection, the court permitted thegovernment to question former FBI Supervisory Special Agent JamesDarcy as an expert witness. Sept. 24, 1998 Tr. at 12. Darcy hadbeen the supervisor of the Organized Crime squad in the AtlanticCity, New Jersey office of the FBI. Darcy Sept. 28, 1998 Tr. at14. His testimony included the following.

Darcy generally would not have targeted an informant forinvestigation for engaging in the type of criminal activity thatwas known to the FBI when he was opened. Darcy Sept. 29, 1998 Tr.at 6-7. On two or three occasions, Darcy employed the proceduresestablished by the Attorney General's Guidelines, and included inthe FBI Manual, to authorize an Organized Crime informant toengage in what would otherwise be a criminal act. Id. at 28-31.Usually, however, it was simply understood and accepted thatOrganized Crime informants had to be engaged in unauthorizedcriminal activity to obtain the information that the FBI wantedconcerning the highly secretive LCN, which was the Bureau'shighest priority for many years. Darcy Sept. 28, 1998 Tr. at42-44.

Darcy confirmed that it was the practice of the FBI to doeverything possible to maintain the confidentiality of the factthat an individual was serving as an FBI informant. Darcy Sept.29, 1998 Tr. at 75. Consistent with this, Darcy never provided aninformant's self-incriminatory statements to anyone outside theFBI. Id. at80-84. To have done so would have exposed the informant'srelationship with the FBI and violated the Bureau'sconfidentiality agreement with him. Id.

Nor did Darcy, or the FBI to his knowledge, ever use aninformant's statements against him. Id. Darcy's experience isconsistent with that of Potts, the former Acting Deputy Directorof the FBI. Potts May 22, 1998 Tr. at 25-28, 64-66.

Darcy did not expect an informant to report to the FBIconcerning his own criminal activity. Darcy Sept. 29, 1998 Tr. at26. Like Ring, Darcy did not ask informants about their owncriminal activity. Id.; Ring June 22, 1998 Tr. at 44-49.

Darcy was never involved in any matter in which the FBI usedinformation provided by an informant to obtain a warrant forelectronic surveillance and later used against the informant theintercepted evidence that he had helped obtain. Darcy Sept. 29,1998 Tr. at 82. In this respect Darcy's experience was consistentwith Ahearn's. Ahearn May 11, 1998 Tr. at 51-52. In addition,Darcy had never listed an informant as a target in an applicationfor a warrant to conduct electronic surveillance in order toconceal the informant's identity. Id. at 25.

As Darcy explained, in some instances the FBI found a person tobe more valuable as a continuing informant than as a cooperatingwitness whose ability to obtain information would vanish when hisrelationship with the FBI was disclosed. Darcy Sept. 28, 1998 Tr.at 135-36.

Finally, there were several potentially meaningful witnesseswho were not available to testify. The parties agreed that aheart attack and a stroke that O'Sullivan suffered during thependency of these proceedings rendered him unavailable. Oct. 6,1998 Order.

In addition, the court did not receive the testimony ofConnolly. The defendants sought to question Connolly. ConnollyApr. 30, 1998 Tr. at 11-13, Oct. 30, 1998 Tr. at 5-6. However,Connolly properly invoked his Fifth Amendment privilege not toanswer any substantive questions because his responses might tendto incriminate him. Connolly Apr. 30, 1998 Tr. at 12-13, Oct. 30,1998 Tr. at 5-6.

After Connolly declined to testify, the defendants asked thecourt to direct the government to request an immunity andcompulsion order concerning Connolly, under 18 U.S.C. § 6001 etseq., or to dismiss the case. Although such orders are rare, therequest presented a serious issue in this case. Oct. 16, 1998 Tr.at 6. Upon consideration of the parties' submissions, and afterseveral hearings, the defendants' motion was denied. Id. at4-30.

In summary, the court found Connolly had made many publicstatements which, if repeated under oath, would corroboratemeaningful aspects of Flemmi's testimony. Id. at 8-9; Ex.DDDDD. More specifically, the court assumed that if immunized andcompelled to testify, Connolly would state that:

[He] was the FBI handling agent for Mr. Flemmi and James Bulger from about 1975 to 1990, that Flemmi and Bulger were Top Echelon informants. The FBI understood that Bulger and Flemmi were engaged in a wide range of criminal activity, possibly including murder. Flemmi and Bulger were extremely valuable confidential informants who provided vital information [regarding] the government's successful efforts to investigate and prosecute La Cosa Nostra in New England, the Department of Justice's top priority here. Mr. Connolly regarded Bulger and Flemmi as the two most valuable sources the FBI in Boston had.

The FBI as an organization, . . . rather than isolated aberrant agents, authorized Bulger and Flemmi to engage in loansharking, gambling, and related activities in order to permit them to perform as confidential informants. The FBI promised that Flemmi and Bulger's identity as confidential informants would never be disclosed, and that if necessary cases would be dismissed to avoid doing so. . . .

John Morris told Bulger and Flemmi that they could do anything short of murder, and they would be protected by the FBI.

After Connolly retired, the government failed to honor the promises that were made to Flemmi and Bulger. The indictment in this case . . . is inconsistent with the promises that the government made to Bulger and Flemmi.

Oct. 16, 1998 Tr. at 8-9.

The court, however, found that it could, as a matter of law,issue the requested order only if it decided that the governmentwas refusing to grant Connolly immunity solely to distort thefactfinding process and thus deprive Flemmi of Due Process. Id.at 9-16. The decision was based on precedent that indicates thatunder the Due Process theory, the court may order the governmentto request an immunity and compulsion order only if thegovernment's decision not to immunize is motivated solely by adesire to distort the factfinding process to the detriment of adefendant. Id. at 5 (citing Angiulo, 897 F.2d at 1192;United States v. Mackey, 117 F.3d 24, 27 (1st Cir.), cert.denied, 522 U.S. 975, 118 S.Ct. 431, 139 L.Ed.2d 331 (1997);United States v. Castro, 129 F.3d 226, 232 (1st Cir. 1997),cert. denied, 523 U.S. 1100, 118 S.Ct. 1569, 140 L.Ed.2d 803(1998)).

As the court explained, in the instant case the government hada mixture of motives for deciding not to immunize Connolly. Onemotive was a good faith desire not to injure the investigation ofConnolly that had been initiated and his possible criminalprosecution for, among other things, aiding and abetting Bulger'sflight to avoid prosecution, which would be a violation of18 U.S.C. § 1073 that had occurred within the statute oflimitations. Oct. 16, 1998 Tr. at 17-19, 24. The government'sdecision concerning Connolly was also motivated in part by adesire to keep information that might be helpful to Flemmi out ofthe record. Id. at 19-24.

Thus, the court held that because the government had one validmotive for its refusal to immunize Connolly, its conduct did notviolate Flemmi's right to Due Process. Id. at 24-25. Therefore,his motion to compel the government to immunize Connolly ordismiss the case was denied. Id. at 29.

Connolly subsequently made certain public statements whichcaused the court to wonder whether he had become willing totestify without immunity. Oct. 27, 1998 Tr. at 32. Thus, thedefendants were allowed to subpoena him again. Oct. 27, 1998 Tr.at 34. However, Connolly again properly asserted his FifthAmendment privilege with regard to all substantive questions.Connolly Oct. 30, 1998 Tr. at 5-6.

As Connolly was unavailable to testify, the defendants moved tohave some of Connolly's public statements admitted as evidence.See Ex. EEEEE (Defendants' Proffer of Declarations AgainstPenal Interest of Potentially Unavailable Witness John Connolly).Although the court was not required to apply the Federal Rules ofEvidence in this proceeding, it utilized Rule 804(b)(3), and therelated jurisprudence, including Williamson v. United States,512 U.S. 594, 114 S.Ct. 2431, 129 L.Ed.2d 476 (1994), as a guidein deciding this motion. Oct. 23, 1998 Tr. at 33-38. As a result,Flemmi's motion was allowed in part and denied in part. Morespecifically, the court admitted the following public statementsbecause they tended to expose Connolly to criminal liability andwere adequately corroborated to be deemed sufficientlytrustworthy to be considered. Id. at 36.

According to Connolly, the "FBI knew what [Flemmi and Bulger]were. They didn't have a paper route when [the FBI] first metthem. All . . . Top Echelon informants are murderers. Thegovernmentput [Connolly] in business with murderers." Id. at 43.

Bulger and Flemmi "were guaranteed that they could run agambling and loansharking operation." Id. at 38. Bulger andFlemmi "were indicted for things they were guaranteed they wouldnot be indicted for." Id. at 46. The indictment in this case"charging Bulger and Flemmi with gambling and loansharking was abetrayal of the promises made to [them]." Id. at 44-45.However, "the minute [Connolly] told [the government] that [he]would testify to the fact that these people were authorized torun a gambling and loansharking business, the [government] didnot want to hear from [him]." Id. at 42.

Connolly "hoped that Bulger was never caught." Id. at 43. "Atleast he kept his end of the bargain." Id. at 45. With regardto the government Connolly wondered, "What ever happened tokeeping your word." Id. at 46.

III. CONCLUSIONS OF LAW

1. Flemmi's Motion to Dismiss or Suppress Based on Immunity

A. The Court is Now Considering Only the Issue of Immunity

On December 29, 1997, the court allowed Flemmi's request for anevidentiary hearing on his motion to dismiss to the extent thatthe motion asserted that he was promised immunity fromprosecution in return for his cooperation with the FBI. SeeSalemme, 1997 WL 810057, at *1 (Dec. 29, 1997). As the courtwrote:

Federal Rule of Criminal Procedure 12(e) directs a court to decide a pretrial motion prior to trial unless there is good cause to defer a decision. In addition, Federal Rules of Criminal Procedure "12(e) and (g) clearly envision that a district court may make preliminary findings of fact necessary to decide the questions of law presented by a pre-trial motion so long as the court's findings on the motion do not invade the province of the ultimate finder of fact." United States v. Jones, 542 F.2d 661, 664-65 (6th Cir. 1976). See also 24 James Wm. Moore et al., Moore's Federal Practice, § 612.07[1] (3rd ed. 1997). Moreover, a district court must decide a pretrial motion prior to trial if deferring a decision would adversely affect a party's right to appeal. See Fed.R.Crim.P. 12(e).

A claim of an enforceable promise of immunity which prohibits a particular prosecution presents an issue to be decided by the court rather than the jury. See, e.g., United States v. McLaughlin, 957 F.2d 12, 16 (1st Cir. 1992) (holding that district court did not err in concluding, after an evidentiary hearing, that the immunity agreement between defendant and the government did not extend to the charge being prosecuted); United States v. Rodman, 519 F.2d 1058, 1059-60 (1st Cir. 1975) (per curiam) (affirming a pretrial order dismissing an indictment because of bad faith of Securities and Exchange Commission ("SEC") official in promising to recommend no prosecution of defendant). See also Charles Alan Wright, Federal Practice and Procedure § 193 (2d ed. 1982) ("The third class of matters contemplated by Rule 12(b) are defenses and objections capable of determination without trial of the general issue. . . . These include . . . immunity."). Thus, Flemmi's claim of immunity can be properly decided, by the court, prior to trial. Indeed, a pretrial ruling may be required to preserve the government's right to appeal pursuant to 18 U.S.C. § 3731 because in some circumstances a motion to dismiss granted at trial may constitute an acquittal for double jeopardy purposes. See 24 Moore, supra, at §§ 612.07[1] and 629.23. See also United States v. Barletta, 644 F.2d 50, 51-59 (1st Cir. 1981) (discussing interaction of Fed.R.Crim.P. 12 and 18 U.S.C. § 3731).

Id. at *1-2.

With regard to immunity, if an individual is compelled totestify pursuantto § 6002 et seq., he is granted use immunity that iscoextensive with his Fifth Amendment privilege and, therefore,protects the individual from prosecution through the use of theimmunized testimony or evidence derived from that testimony.See 18 U.S.C. § 6002 (1994); Kastigar v. United States,406 U.S. 441, 453, 92 S.Ct. 1653, 32 L.Ed.2d 212 (1972). However, inexchange for his cooperation the government may also grant anindividual "varying degrees of immunity in an informalagreement." United States v. Dudden, 65 F.3d 1461, 1467 (9thCir. 1995).

Therefore, the government may in entering into an informalimmunity agreement promise that an individual will not beprosecuted at all in exchange for his cooperation, which isgenerally called "transactional immunity." Id. at 1468; UnitedStates v. McHan, 101 F.3d 1027, 1034 (4th Cir. 1996); UnitedStates v. Eliason, 3 F.3d 1149, 1152 (7th Cir. 1993); Rowe v.Griffin, 676 F.2d 524, 526-27 (11th Cir. 1982); United Statesv. Harvey, 869 F.2d 1439, 1443 (11th Cir. 1989). Similarly, thegovernment may agree to provide use and derivative use immunitycoextensive with that granted by operation of § 6002, or onlythat an individual's statements will not be used directly againsthim. United States v. Plummer, 941 F.2d 799, 803-04 (9th Cir.1991); United States v. Lyons, 670 F.2d 77, 80 (7th Cir. 1982).With regard to informal immunity, "[a] defendant's rights aredetermined by the terms and conditions of the bargain as found bythe court." United States v. McLaughlin, 957 F.2d 12, 16 (1stCir. 1992).

It is the question of alleged immunity that the court is nowaddressing. It may be valuable to recognize, however, the relatedissues that are not now before the court, but which may have tobe decided at trial, by a jury if there is sufficient evidencefor the government to survive a motion for a judgment ofacquittal pursuant to Federal Rule of Criminal Procedure 29.

The court is not now considering Flemmi's intended publicauthority, or authorization, defense, "which may come into playwhen a defendant undertakes certain acts, reasonably relying onthe statements of a government agent cloaked with actualauthority." United States v. Holmquist, 36 F.3d 154, 161 n. 7(1st Cir. 1994). In essence, "[a]ctions properly sanctioned bythe government are not illegal." Baptista-Rodriguez, 17 F.3d at1368 n. 18.

Nor is the court now evaluating Flemmi's foreseeable defense ofentrapment by estoppel, which:

is predicated upon fundamental notions of fairness embodied in the Fifth Amendment's due process clause. Whether the prosecution of a defendant violates his due process rights depends not solely upon whether he was incorrectly informed or misled by a government official, but upon the totality of the circumstances surrounding the prosecution.

United States v. Smith, 940 F.2d 710, 714 (1st Cir. 1991). Seealso United States v. Ellis, 168 F.3d 558, 561 (1st Cir. 1999).

In addition, it is premature for the court to consider themerits of the defendants' foreseeable claim that the governmenthas not proven the particular enterprise or precise conspiraciesalleged in the Fourth Superseding Indictment. More specifically,as indicated earlier,

In this case, the government must prove the precise RICO conspiracy, RICO Enterprise, and conspiracy to extort bookmakers and drug dealers which are at the heart of the Fourth Superseding Indictment. See 4SI counts 1 and 3. Any material variance in the proof of those charges should result in the defendants' acquittal. United States v. Glenn, 828 F.2d 855, 858-60 (1st Cir. 1987) (Breyer, J.) (dismissing drug conspiracy conviction due to variance between indictment and proof at trial); United States v. Gorman, 807 F.2d 1299, 1305 (6th Cir. 1986) ("Variances which create a substantial likelihood that a defendant may have been convicted of an offense other than charged by the grand jury . . . are considered per se prejudicial."), cert. denied, 484 U.S. 815, 108 S.Ct. 68, 98 L.Ed.2d 32 (1987); United States v. Snider, 720 F.2d 985, 989-90 (8th Cir. 1983) (reversing convictions due to variance between number of conspiracies charged and proven), cert. denied, 465 U.S. 1107, 104 S.Ct. 1613, 80 L.Ed.2d 142 (1984).

The Fourth Superseding Indictment charges that Bulger and Flemmi were integral members of each of the conspiracies alleged; indeed, they are two of the five named coconspirators. See 4SI, Count 1, ¶ 2 and Count 3. They are also two of the five named members of the alleged RICO Enterprise, one purpose of which, the government contends, was to coordinate the activities of the Patriarca Family and the Winter Hill Gang. See 4SI Count 1, ¶¶ 1(b)(2), 1(k); February 14, 1997 Bill of Particulars.

If informed that Bulger, as well as Flemmi, was cooperating with the government during the relevant period, it is foreseeable that the other defendants are likely to argue at trial that Flemmi and Bulger were government agents; that, therefore, they were not members of the conspiracies or RICO Enterprise alleged in the indictment, see, e.g., United States v. Duff, 76 F.3d 122, 127 (7th Cir. 1996) ("[A]n agreement with an agent of the police is not a criminal conspiracy."); United States v. Nason, 9 F.3d 155, 161 n. 2 (1st Cir. 1993) (citing United States v. de Bright, 742 F.2d 1196, 1198-1200 (9th Cir. 1984)); and, thus, that the conspiracies and substantive RICO offenses charged in the indictment have not been proven. This defense may be particularly promising with regard to the RICO charges on which the government will be required to prove both the existence of the Enterprise alleged and its on-going effort to coordinate the activities of the Patriarca Family and the Winter Hill Gang, which Bulger and Flemmi are alleged to have led. Similarly, if Bulger and Flemmi were informants, their codefendants are likely to contend that their statements may not be admitted under Federal Rule of Evidence 801(d)(2) because they were not truly coconspirators. See United States v. Eisenberg, 596 F.2d 522, 527 (2d Cir. 1979) (holding that declarations of individuals acting as government informants may not be admitted on the theory that they are agents of defendants.).

Moreover, it is foreseeable that if both Bulger and Flemmi were secretly providing information to the government during the period relevant to this case, the defendants may contend that they have been entrapped or otherwise victimized by government misconduct.

Salemme, 978 F. Supp. at 353-54 (footnotes omitted).

Finally, the court is, of course, not now addressing theimplications of Flemmi's valuable service to the government forthe sentence that should be imposed if he is convicted. If thatcontingency occurs, the facts described in this Memorandum willundoubtedly generate a claim that Flemmi's case is not within the"heartland" contemplated by the Sentencing Commission when itpromulgated its Guidelines and that Flemmi is entitled to adownward departure from the ordinarily applicable Guidelinerange. See 18 U.S.C. § 3553(b); U.S.S.G. § 5K2.0.

B. The Applicable Standards Concerning Immunity

"Since . . . immunity-in-exchange-for-cooperation agreementsare in the nature of contracts, their scope and effects arestrongly influenced by contract law principles." McLaughlin,957 F.2d at 16. Courts, however, "are not obliged to followblindly the law of contracts in assessing . . . cooperationagreements." United States v. Carrillo, 709 F.2d 35, 36 n. 1(9th Cir. 1983). See also Plummer, 941 F.2d at 802. Rather, asthe Court of Appeals forthe Fourth Circuit said concerning plea agreements, in terms alsoapplicable to immunity agreements in which individuals, amongother things, relinquish Fifth Amendment rights:

[T]he courts have recognized that [the rules relating to private contracts] have to be applied . . . with two things in mind which may require their tempering in particular cases. First, the defendant's underlying "contract" right is constitutionally based and therefore reflects concerns that differ fundamentally from and run wider than those of commercial contract law. See Mabry v. Johnson, 467 U.S. at 509, 104 S.Ct. at 2548 (broken government promise that induced guilty plea implicates due process clause because it impairs voluntariness and intelligence of plea). Second, with respect to federal prosecutions, the courts' concerns run even wider than protection of the defendant's individual constitutional rights — to concerns for the "honor of the government, public confidence in the fair administration of justice, and the effective administration of justice in a federal scheme of government." United States v. Carter, 454 F.2d 426, 428 (4th Cir. 1972).

United States v. Harvey, 791 F.2d 294, 300 (4th Cir. 1986).See also United States v. Streebing, 987 F.2d 368, 372 (6thCir. 1993) (for the purposes of deciding whether to enforce apromise "a cooperation agreement is analogous to a plea bargainagreement.").

Thus, "[d]ue process requires the government to adhere to theterms of any plea bargain or immunity agreement it makes."Harvey, 869 F.2d at 1443. See also United States v. Thompson,25 F.3d 1558, 1562 (11th Cir. 1994); United States v. Lua,990 F. Supp. 704, 709 (N.D.Iowa 1998). This principle is not disputed.Rather, the government represents that:

The United States recognizes that Due Process requires that it adhere to the terms of any plea bargain or immunity agreement that it makes. Santobello v. New York, 404 U.S. 257, 262, 92 S.Ct. 495, 30 L.Ed.2d 427 (1971) (plea agreement); Bemis v. United States, 30 F.3d 220, 221 (1st Cir. 1994) (plea agreement); Rowe v. Griffin, 676 F.2d 524 (11th Cir. 1982) (immunity).

Gov. Post-Hearing Brief at 50-51. In essence, Due Process meansthat generally applicable principles of contract law must beapplied, and if necessary modified, to assure that an individualis "not deprived of his liberty in any fundamentally unfair way."Mabry v. Johnson, 467 U.S. 504, 510, 104 S.Ct. 2543, 81 L.Ed.2d437 (1984).

As indicated earlier, with regard to alleged immunityagreements, the court must first determine if a bargain was made.Lua, 990 F. Supp. at 710. If an agreement exists, a "defendant'srights are determined by the terms and conditions of the bargainas found by the court." McLaughlin, 957 F.2d at 16. See alsoUnited States v. Hogan, 862 F.2d 386, 388 (1st Cir. 1988);Plummer, 941 F.2d at 805; Dudden, 65 F.3d at 1467.

Informal grants of immunity may be oral as well as written.McLaughlin, 957 F.2d at 16; Harvey, 869 F.2d at 1439;66Lua, 990 F. Supp. at 709. In addition,an informal immunity agreement may be express or implied from theconduct of the parties. More specifically:

While a contract is made when the parties verbally express their mutual assent to its essential terms, it may also be implied when the parties' conduct manifests their agreement. See 1 Restatement (Second) of Contracts § 19 (1979).

McHan, 101 F.3d at 1034. See also Lua, 990 F. Supp. at 709. Asthe Supreme Court has explained:

An agreement implied in fact is "founded upon a meeting of minds, which, although not embodied in an express contract, is inferred, as a fact, from conduct of the parties showing, in the light of the surrounding circumstances, their tacit understanding."

Hercules Inc. v. United States, 516 U.S. 417, 424, 116 S.Ct.981, 134 L.Ed.2d 47 (1996) (quoting Baltimore & Ohio R. Co. v.United States, 261 U.S. 592, 597, 58 Ct.Cl. 709, 43 S.Ct. 425,67 L.Ed. 816 (1923)). Among other things, "[a]n implied-in-factcontract arises from `[c]onduct that would lead a reasonableperson in the other party's position to infer a promise in returnfor performance or promise. . . .'" Prescott v. Morton Int'l,Inc., 769 F. Supp. 404, 410 (D.Mass. 1990) (quoting E.A.Farnsworth, Contracts § 3.10 at 124 (1982)).

"`The rule requiring compliance by the government with promisesmade during plea bargaining and analogous contexts generallyrequires that the agent be authorized to make the promise.'"Margalli-Olvera v. Immigration and Naturalization Serv.,43 F.3d 345, 353 (8th Cir. 1994) (quoting Thomas v. Immigration andNaturalization Serv., 35 F.3d 1332, 1338 (9th Cir. 1994)). Seealso San Pedro, 79 F.3d at 1068.

In the law of agency, actual authority takes two forms: (1) express authority, and (2) authority that is implied or incidental to a grant of express authority. W. Edward Sell, Sell on Agency 25-31 (1985).

Thomas, 35 F.3d at 1338. See also San Pedro, 79 F.3d at 1068;Margalli-Olvera, 43 F.3d at 353.

Implied or incidental actual authority is derived from theexpress powers given to the agent. Generally, "authority toconduct a transaction includes authority to do acts which areincidental to it, usually accompany it, or are reasonablynecessary to accomplish it." Restatement (Second) of Agency §35 (1957). Actual authority is "created by acts of a principal .. . that would reasonably lead another . . . to believe thatthe other was authorized to act for the principal." UnitedStates v. Greene, 995 F.2d 793, 800 (8th Cir. 1993) (citingRestatement (Second) of Agency § 7 at 28, § 7 cmt. c at 29-30,§ 26 at 100, § 26 cmt. a at 101, § 26 cmt. b at 101-02(1957)).67 Thus, the existenceof implied or incidental actual authority depends on whether theprincipal's actions would create the belief in a reasonableperson that the principal had bestowed authority on that person."Authority `is generally implied when such authority isconsidered to be an integral part of the duties assigned toa[g]overnment employee.'" Thomas, 35 F.3d at 1340 (quoting H.Landau & Co. v. United States, 886 F.2d 322, 324 (Fed.Cir.1989)).

There are, however, circumstances in which Due Process mayrequire that the government perform a promise made by an agentwho exceeded his actual authority. As the Court of Appeals forthe First Circuit has noted:

courts on occasion have specifically enforced promises that would encroach on the jurisdiction of independent entities. See, e.g., Palermo v. Warden, 545 F.2d 286, 296 (2d Cir. 1976).

Bemis v. United States, 30 F.3d 220, 221 n. 1 (1st Cir. 1994).In general, those decisions are rooted in the principle that,"fundamental fairness and public confidence in governmentofficials require that [the government] be held to `meticulousstandards of both promise and performance.'" Palermo v. Warden,545 F.2d 286, 296 (2d Cir. 1976) (quoting Correale v. UnitedStates, 479 F.2d 944, 947 (1st Cir. 1973)). Thus, as the Courtof Appeals for the First Circuit has written, for the purposes ofdetermining whether an individual has been deprived of DueProcess, "`the crucial question is not whether the Government hadthe authority to carry out the promise which [petitioner] claimshe understood it to make, but whether it did in fact make such apromise.'" Bemis, 30 F.3d at 222 (quoting United States v.Cook, 668 F.2d 317, 320 (7th Cir. 1982)).

This principle has been applied to informal immunityagreements, which, as previously described, have been regularlyanalyzed pursuant to the same principles as plea agreements.See, e.g., United States v. Rodman, 519 F.2d 1058, 1059-60 (1stCir. 1975) (dismissing on grounds of fairness indictment ofdefendant based on unfulfilled promise of Securities and ExchangeCommission attorney to recommend strongly no prosecution, wheredefendant made self-incriminatory statements, but there was nofinding that they had been used against him directly orindirectly); Carrillo, 709 F.2d at 36-37 (enforcing promise byDEA agents that defendant would not be prosecuted if hecooperated in their investigation despite apparent lack ofparticipation of a prosecutor in the promise or any evidenceprovided by defendant being used against him).

In addition, "under the self-incrimination clause of the fifthamendment, evidence of guilt induced by a government promise ofimmunity is `coerced' evidence and may not be used against theaccused." Rowe, 676 F.2d at 527. See also Shotwell Mfg. Co. v.United States, 371 U.S. 341, 347-48, 83 S.Ct. 448, 9 L.Ed.2d 357(1963); United States v. Walton, 10 F.3d 1024, 1028-31 (3rdCir. 1993); United States v. Rogers, 906 F.2d 189, 190-91 (5thCir. 1990); United States v. Swint, 15 F.3d 286, 290 (3rd Cir.1994); United States v. Conley, 859 F. Supp. 830, 835-37(W.D.Pa. 1994). If it is proven that a defendant was induced tomake statements to the FBI because its agents caused him to havea reasonable, but erroneous belief that he had a valid immunityagreement with the government, a constitutional violation hasbeen established and neither his statements nor any evidencederived from them may be used against him. Oregon v. Elstad,470 U.S. 298, 305, 105 S.Ct. 1285, 84 L.Ed.2d 222 (1985); UnitedStates v. Byram, 145 F.3d 405, 409 (1st Cir. 1998).

When the government obtains evidence as a result of a formal orinformal grant of use and derivative use immunity, and it appearsthat such evidence may have been misused to secure thedefendant's indictment, the case against him must be dismissedunless the government proves by a preponderance of the evidencethat it had a legitimate, independent source for the informationpresented to the grand jury or, if the government cannot disprovetaint, that the error was harmless beyond a reasonable doubt.Kastigar, 406 U.S. at 460; United States v. Schmidgall,25 F.3d 1523, 1530-31 (11th Cir. 1994) ("Schmidgall I"); UnitedStates v. Schmidgall, 25 F.3d 1533, 1538 (11th Cir. 1994)("Schmidgall II"); United States v. Bartel, 19 F.3d 1105,1112 (6th Cir. 1994); United States v. Palumbo, 897 F.2d 245,251 (7th Cir. 1990); United States v. Poindexter, 951 F.2d 369,377 (D.C.Cir. 1991). If, however, statements were madeinvoluntarily as a result of an unauthorized promise of immunityand used, directly or indirectly, to secure the defendant'sindictment, the remedy is suppression at trial rather thandismissal of the case. United States v. Calandra, 414 U.S. 338,345, 94 S.Ct. 613, 38 L.Ed.2d 561 (1974).

C. Dismissal of This Case Is Not Now Justified Because Flemmi Was Not Promised Immunity From Prosecution

Flemmi claims that he had an enforceable, unwritten agreementthat he would not be prosecuted in return for his service as anFBI informant. Thus, he contends that this case should bedismissed for violating the immunity conferred on him by thatagreement. As indicated earlier, this claim requires that thecourt initially determine, from the credible direct andcircumstantial evidence, whether Flemmi and the governmententered into any agreement and, if so, the terms of theirbargain.

The court finds that the FBI agents primarily responsible fordealing with Flemmi, by word and deed, for thirty years, promisedFlemmi protection in return for his service as an informant. Theconduct of many other members of the FBI, including at leastthree ASACs, and the Chief of the Organized Crime Section at FBIHeadquarters, contributed to creating, communicating, andperforming the promise of protection to Flemmi. Flemmi reasonablyrelied on the FBI's promise of protection and, in return for it,provided very valuable assistance to the government in its waragainst the LCN, among other things.

Flemmi was not, however, explicitly or implicitly promisedimmunity from prosecution. The term immunity was never used inconversation with him. More importantly, Flemmi did notunderstand that the government, or any of its agents, had agreedthat he would not be investigated, by the FBI or any other lawenforcement agency, or prosecuted. Rather, he expected that theFBI would overlook some of his criminal activity, provide himinformation concerning any investigations that were conducted,and warn him of any imminent charges against him of which itlearned. As set forth in this Memorandum, the FBI performed itspart of the bargain. Thus, it is not necessary or appropriate todecide if the agents entering into this agreement were authorizedto do so, or whether the agreement was not valid because itviolated public policy or because it attempted to provideimmunity for future criminal conduct.

More specifically, as described in detail in this Memorandum,Rico, Connolly, and Morris each told Flemmi that he would be"protected" in return for serving as an informant. §§ II.2, II.5,II.18, supra. Only Morris qualified this promise in any way bytelling Flemmi, in effect, that he would be protected "as long ashe did not clip anyone." § II.18, supra. As Flemmi testified,neither Rico nor Connolly ever used the word "immunity." §§ II.2,II.5, supra. Nor did Morris. § II.18, supra.

The conduct of Rico, Connolly, Morris, and many but not all oftheir colleagues at the FBI, expressed even more clearly thantheir words the FBI's agreement to protect Flemmi. Rico toldFlemmi about other individuals who were cooperating with lawenforcement so that Flemmi could be careful around them. § II.14,supra. In 1969, Rico advised Flemmi that he andSalemme would soon be indicted and suggested that they fleepromptly. § II.2, supra. In addition, as Rico promised, Flemmiwas released on bail and the fugitive charges against him weredismissed when Flemmi followed Rico's advice and returned toBoston in 1974. § II.3, supra.

Connolly and Morris, individually and in tandem, also actedrepeatedly to protect Flemmi. In 1977 or 1978, Connollyintimidated executives of National Melotone from pursuing theircomplaint that Bulger and Flemmi were extorting the company'scustomers. § II.7, supra. In early 1979, with their sources'consent, Morris and Connolly told O'Sullivan that Flemmi andBulger were valuable informants and persuaded him, with theconsent of Daly, not to indict them in the race-fix case, in partso they could contribute to the FBI's effort to bug 98 PrinceStreet. § II.9, supra. In 1979, Morris received reports frominformants that Bulger and Flemmi were shaking down bookmakers,but no investigation was conducted. § II.10, supra.

In 1980, Connolly informed Bulger and Flemmi that the LancasterStreet Garage was bugged or confirmed this fact for them. §II.11, supra. In 1980, in a further effort to obtain neededassistance, Morris and Connolly told Flemmi and Bulger that anyevidence intercepted at 98 Prince Street would not be a problemfor them. Id. Bulger and Flemmi, they said, would be protected,rather than prosecuted, for anything captured by the bug the FBIhoped to place at 98 Prince Street. Id. Flemmi and Bulger weresubsequently told when the bug at 98 Prince Street was installedand when it was removed so that they would not be intercepted.Id.

In 1982, Morris caused Connolly to tell Flemmi and Bulger thatHalloran was cooperating with the FBI and had implicated them inthe Wheeler murder. § II.13, supra. In an effort to protectBulger and Flemmi, Morris and Connolly also identified for themat least a dozen other individuals who were either FBI informantsor sources for other law enforcement agencies. § II.14, supra.McIntyre may have been among them. Id.

In 1984, Connolly received reliable information that Bulger andFlemmi were engaged in an ongoing extortion of the Rakesconcerning the South Boston Liquor Mart, but neither recorded theinformation nor conducted any investigation. § II.15, supra. Hedid, however, share the information that he had received withBulger. Id.

In 1984, Connolly also warned Flemmi and Bulger of theinvestigation, being led by the DEA, targeting them. § II.17,supra. He subsequently told them of the wiretap that had beenplaced on Kaufman's phone. Id.

In April 1985, at a dinner that may have been held to celebratethe success of the effort to protect Bulger and Flemmi byfrustrating what had become a joint DEA-FBI investigation ofthem, Morris reiterated that they would not be prosecuted foranything on the 98 Prince Street tapes. § II.18, supra. He alsosaid to them, in Connolly's presence, that "you can do anythingyou want as long as you don't clip anyone." Id.

In 1986, after tasking Flemmi to acquire information vital tothe FBI's effort to bug Vanessa's, Connolly told him when the bugwas installed so that Flemmi would not be intercepted. § II.20,supra. Connolly later told Flemmi when the bug had beenremoved. Id.

In 1988, Connolly advised Flemmi that Cox would be wired andwould attempt to engage Flemmi in incriminating conversation. §II.26, supra. Also in 1988, Morris had Connolly warn Flemmi andBulger to stay away from Bahorian, whose telephone was about tobe tapped in an effort to acquire evidence against Flemmi, amongothers. Id. Morris later reiterated this warning directly toBulger and Flemmi. Id. He also told Flemmi that he could keephim out of any indictment arising from the Bahorian electronicsurveillance. Id. Although Bahorian and others were ultimatelyindicted, Flemmi was not. Id.

In 1988 or 1989, Connolly told Bulger that Timothy Connolly wascooperating with the FBI and would try to record conversationswith Bulger and Flemmi. § II.28, supra. Bulger passed thiswarning on to Flemmi. Id.

After providing Connolly information to assist in the FBI'seffort to recruit Mercurio as an informant, Flemmi was told whenthat initiative had succeeded. § II.29, supra.

Following his retirement in 1990, Connolly used his enduringconnections with Quinn and other former friends and colleagues onthe Organized Crime squad to obtain information concerninginvestigations that might have resulted in charges against Bulgerand Flemmi. § II.32, supra. Connolly regularly shared theinformation he acquired with them. Id. In early January 1995,Connolly accurately advised Bulger that he and Flemmi would beindicted on about January 10, 1995. Id. This warning, whichBulger shared with Flemmi, facilitated Bulger's flight to avoidprosecution and would have done the same for Flemmi if he hadacted on Connolly's advice immediately. Id.

While Rico, Morris, and particularly Connolly were at the hubof the protection promised and provided to Flemmi, many of theircolleagues and superiors in the FBI also contributed by theirconduct to that promise and to its fulfillment.

In 1977, Daly and Kennedy were told by Green that Bulger andFlemmi had threatened to kill him in connection with theirattempt to collect a debt, but no effort was made to develop thereluctant Green as a witness against them. § II.7, supra. In1979, Daly later joined O'Sullivan in agreeing to leave Bulgerand Flemmi out of the race-fix indictment. § II.9, supra.

In 1982, the Boston FBI agents aware of Halloran's cooperationdid not tell their counterparts in Oklahoma City, who hadexpressed interest in him, that Halloran was available to beinterviewed. § II.13, supra. When agents from Oklahoma Citysought to interview Bulger and Flemmi, ASAC Fitzpatricksuccessfully opposed this request, in part by falsely claimingthat he had interviewed Bulger about the matter. Id.

In 1984, McWeeney, then the Chief of the Organized CrimeSection at FBI Headquarters, told Connolly that the DEA wasleading an investigation targeting Bulger and Flemmi. § II.17,supra. Connolly shared this information with his sources. Id.

In 1988, Rod Kennedy, Newton, their supervisor Ellavsky, andASAC Potts provided Bulger and Flemmi protection concerning theon-going extortion of Slinger. § II.22, supra. Although Slingerwas willing to wear a wire and testify against Flemmi and Bulger,after Ellavsky consulted Potts, the information that he providedwas neither memorialized nor investigated. Id. Instead, Bulgerwas told that Slinger had spoken to the FBI. Id.

Bulger and Flemmi were also protected by the FBI in thesuccessful investigation of Willis and others. § II.23, supra.Although in 1986 and 1987, Ellavsky and Blackburn receivedincreasingly specific information that Bulger was extortingWillis, after Connolly was consulted no investigation of Bulgerwas conducted. Id. Nor was the information the FBI had receivedconcerning Bulger shared with the other agencies involved in thejoint investigation of Willis. Id.

Similarly, in 1987, when Lavin obtained photographs and otherinformation indicating that City of Boston employees hadillegally erected guardrails on the private property of the SouthBoston Liquor Mart, he consulted Connolly. § II.24, supra.After being advised that Bulger was a valuable informant, Lavinmade no record of the information he had received and conductedno investigation. Id.

When Murray was interviewed by Quinn and Clark in 1989, he waseither not asked about his allegations that Connolly and Newtonwere selling information concerningelectronic surveillance to Bulger and Flemmi or his responseswere not recorded in the notes or 302 of the interview. § II.25,supra. ASAC O'Callahan, however, subsequently prepared amemorandum which the SAC, Ahearn, sent to FBI Headquartersstating that those allegations were unsubstantiated. Id. Inaddition, Murray evidently was not questioned in detail about theinformation he indicated that he had concerning Bulger's role inthe Halloran murder, or Bulger and Flemmi's roles in the murderof Barrett. Id. Moreover, the information Murray did providewas not given to the FBI agents responsible for those murderinvestigations or indexed in a way that would permit them to findit. Id. Nor was any effort made to utilize the willing Murrayas a source of information to be used against Flemmi, Bulger, oranyone else. Id.

Finally, the evidence indicates that members of the OrganizedCrime squad kept Connolly advised of at least some developmentsin the investigation of Flemmi and Bulger that was initiatedafter Connolly retired. § II.32, supra. Quinn, the supervisorof that squad, provided Connolly with highly confidentialinformation concerning a threat to Connolly's former sourceMercurio, and may have done the same regarding Flemmi and Bulger.Id. In any event, some member(s) of the FBI told Connolly thedate that indictments in this case were expected. Connolly usedthat information to honor his promise to protect Bulger andFlemmi.

It should also be recognized, however, that agents of the FBIin Boston were not uniform in their conduct concerning Bulger andFlemmi. Knotts earnestly sought information to support the effortof the Massachusetts State Police to bug the Lancaster StreetGarage. § II.11, supra. Brunnick, Montanari, and Cleary weregenuinely attempting to investigate whether Flemmi and Bulgerwere responsible for the Callahan, Halloran, and Wheeler murders.§ II.13, supra. Greenleaf sincerely attempted to insulateConnolly from knowledge of the joint investigation of Flemmi andBulger. § II.17, supra. Jordan and Stanley Moody targetedFlemmi as part of the Bahorian investigation. § II.26, supra.

Although advised by members of the FBI of virtually all ofthese investigations, and many others, Flemmi never claimed thatthey were improper because he had an agreement with the FBI thatprovided him with immunity from investigation by the FBI or anyother agency, or from prosecution. Rather, when informed of theforthcoming indictments in the Fitzgerald bombing and Bennettmurder cases, Flemmi fled. § II.2, II.3, supra. Twenty-fiveyears later, Flemmi fled again when he was advised that he mightsoon be indicted with Yerardi. § II.32, supra. When told thatO'Sullivan had agreed to leave him out of the race-fix case,Flemmi expressed gratitude, rather than assert that it would havebeen impermissible for him to have been indicted. § II.9,supra. As Flemmi testified, he viewed the tip that there was awiretap on Kaufman's telephone as both a manifestation of theFBI's promise of protection and as part of the performance ofthat promise. § II.17, supra.

As Flemmi's conduct indicates, and as his testimony confirms,he always understood that his status as an FBI informant did notmean that he could not be investigated or prosecuted. §§ II.2, §II.9, § 11.17, supra. Rather, he only expected the sort ofprotection that Rico, Connolly, Morris, and many of theircolleagues regularly provided to him for thirty years. Thatprotection permitted Flemmi and Bulger to survive repeatedefforts by various law enforcement agencies to investigate themand allowed them to profit from their contribution to the FBI'scampaign to destroy the LCN. As Flemmi testified, the potentialfor such profit was valuable consideration for his services. §II.20, supra.

Accordingly, the court finds that Flemmi did not have either anexpress agreementor an agreement implied in fact that he would not be prosecuted.It is, therefore, not necessary or appropriate to determine ifthe agents who, expressly and/or through their actions, promisedFlemmi protection were authorized to do so. Nor, for the purposesof deciding the motion to dismiss must the court decide whetherany such agreement would be void and unenforceable as againstpublic policy because it was inherently "an agreement to achievemutual benefit from the parties' cooperative violation of thelaw." Kiely v. Raytheon, 105 F.3d 734, 736 (1st Cir. 1997).

Finally, although Flemmi rendered very valuable service to thegovernment for thirty years, he did not rely to his detriment onan unfulfilled promise that he would not be prosecuted. He waspromised protection and that protection was provided untilJanuary 1995. Thus, his motion to dismiss based on an allegedpromise of immunity generally is being denied.

D. The Issues of Use and Derivative Use Immunity

As an alternative to his motion to dismiss for a violation ofhis alleged agreement with the FBI that he would not beprosecuted, Flemmi asserts that he is entitled to direct andderivative use immunity concerning his statements to the FBI.With regard to this claim, the court concludes that Flemmi doesnot have immunity with regard to everything that he said to theFBI. However, the FBI's promise to maintain the confidentialityof Flemmi's service as an FBI informant also constitutes anenforceable promise not to use statements he made against him ifdisclosure of those statements would, as a practical matter,reveal that Flemmi had been an informant.

Therefore, Flemmi's statements that would identify him as aninformant could not have properly been presented to the grandjuries which indicted him. Circumstances suggest that it isdoubtful that any such statements were used in this fashion.However, additional evidence will be required to resolve thisquestion.

In addition, in the absence of a defense of public authority,or any other defense requiring presentation by Flemmi of some ofhis communications with the FBI, his statements to its agentsthat would identify Flemmi as an informant would not beadmissible at trial. However, if, as represented, Flemmi reliesat trial on some of his communications with the FBI, the courtwill, pursuant to Federal Rules of Evidence 106 and 611, permitthe government to offer other statements of Flemmi to the Bureauin order to assure that the jury is presented with an appropriaterecord on which to decide fairly the merits of his defenses.

The promise of confidentiality that Flemmi received andreasonably relied upon does not alone preclude the governmentfrom making derivative use of his statements to the extent thatsuch indirect use does not necessarily entail disclosure ofFlemmi's informant status. However, as set forth in § III.1.D(3),supra, Flemmi does have an enforceable agreement that made itimproper for the government to present the 98 Prince Street and34 Guild Street interceptions, and any evidence derived fromthem, to the grand juries that indicted him. Although theVanessa's interceptions were not presented to those grand juries,if any evidence derived from them was introduced, that too wasimproper. In this case, several witnesses before the grand juryread some or all of Flemmi's informant file. Thus, theirtestimony may have been impermissibly influenced by statementsFlemmi made pursuant to valid promises of immunity. In addition,such statements may have been improperly utilized asinvestigatory leads, to identify witnesses or shape thequestioning of them.

In the circumstances, a further hearing will be required todetermine whether the case against Flemmi must be dismissedbecause the grand jury was exposed to evidence presented inviolation of the promises of immunity to Flemmi. At this hearingthe government will be required toprove that the information it presented to secure the indictmentsof Flemmi was not tainted by showing that it had a legitimate,independent source for that evidence. If it cannot satisfy thisburden, to avoid dismissal the government will have to prove thatits error was harmless beyond a reasonable doubt. The requiredhearing will probably necessitate the production to Flemmi of thefull transcripts of the grand jury proceedings.

Moreover, as discussed in § III.1.D(5), supra, there issubstantial evidence suggesting that if, contrary to this court'sconclusion, Flemmi does not have an enforceable agreementprohibiting the direct and indirect use against him of thestatements that he made which the government used to obtain thewarrants used to bug 98 Prince Street, Vanessa's, and 34 GuildStreet, those statements were not voluntary, and their useagainst him, directly or indirectly, would therefore violate hisconstitutional rights under the self-incrimination and DueProcess clauses of the Fifth Amendment. If this is true, neitherFlemmi's statements nor any evidence derived from them may beused against him at trial. In addition, it may be appropriate forthe court to decide whether this is one of the rare instances inwhich a case should be dismissed as an exercise of itssupervisory powers or to afford the defendant the fundamentalfairness to which he is entitled as a matter of Due Process. Theparties have not, however, adequately addressed these issues,which have come into clear focus only as a result of the factsfound in this Memorandum. Thus, the court will provide them anopportunity to present their views on these issues beforedeciding them.

(1) Flemmi Does Not Have An Agreement Providing Use Immunity Generally For His Statements to the FBI

The mere fact that an individual is an informant does not meanthat nothing he says to the FBI may be used against him as amatter of law. As Flemmi recognizes, to the extent that thecourts have, in other contexts, recognized a common law"informant's privilege," it relates to protecting the informant'sidentity rather than the content of the informant's communicationwith law enforcement agents. Flemmi's Post-Hearing Memorandum inSupport of Motion to Dismiss Indictment Based on Promise ofImmunity at 40 n. 15 (citing Irons v. Federal Bureau ofInvestigation, 880 F.2d 1446, 1450 (1st Cir. 1989)). As theCourt of Appeals for the District of Columbia Circuit wrote inWestinghouse Elec. Corp. v. City of Burlington, Vt.,351 F.2d 762, 768 (D.C.Cir. 1965), Roviaro, supra, establishes that:"Only the identity of the informer is privileged. The content ofthe communication is not privileged unless it would tend toreveal the identity of the informer."

In this case, the general question of whether what Flemmi saidto the FBI could be used against him was never discussed withhim. The term "immunity" was never used. In 1979, Flemmi wassufficiently concerned about what would be done with any evidencethat might be intercepted at 98 Prince Street to ask about thisissue. §§ II.11, supra, III.1.D(3), infra, This indicatesthat he did not believe that he had been previously promised useimmunity generally.

As described in detail in this Memorandum, it was the practiceof the FBI not to use an informant's statements against him, §§II.2, II.5, II.8, II.16, II.20, II.21, II.33, supra, and thispractice was followed with regard to Flemmi. This practice alone,however, did not establish an agreement that none of Flemmi'sstatements would ever be used against him, directly orindirectly. Thus, the motion to suppress all such statements andany evidence derived from them is not meritorious.

(2) The Promise of Confidentiality Means Statements to the FBI Which Have the Effect of Identifying Flemmi as an Informant Cannot Be Used Against Him Unless His Defense Makes Them an Issue

As the government recognizes, "the evidence adduced during thehearingindicated that there was an understanding between Flemmi and theFBI that his status as an informant would be confidential." Apr.6, 1999 Government's Submission Pursuant to Court's Mar. 28, 1999Order at 65. Indeed, the evidence establishing that Flemmi waspromised confidentiality is unequivocal and overwhelming. As eachof the relevant witnesses beginning with Rico testified, thepromise of confidentiality is at the "heart" of the FBI'srelationship with all of its informants. It is an assurance thatthe Bureau regards as "sacred." Thus, as demonstrated by thematters described in this Memorandum concerning Flemmi, Bulger,Mercurio, Donati, and others, the FBI will rarely, if ever,disclose the identity of an informant even to Department ofJustice attorneys without the source's consent.

Inherent in the promise of confidentiality is the assurancethat no statement that would as a practical matter disclose thefact that the speaker is an FBI informant will be disclosed toany law enforcement officer or prosecutor. As statements directlyor indirectly identifying an informant may not be disclosed, itnecessarily follows that they may not be presented against him inany grand jury investigation or prosecution.

The promise of confidentiality made to an informant, however,does not alone assure him that no other use against him will bemade of the information that he provides. To the extent that theuse of information provided by an informant masks its source,that use is not inconsistent with the assurance ofconfidentiality.

The FBI was authorized to promise an informant confidentialityexpressly and, therefore, to assure him implicitly that nothinghe said would be used against him in a manner that would identifyhim as an FBI source. In essence, the Attorney General isauthorized to appoint officials "(1) to detect and prosecutecrimes against the United States; . . . and (3) to conduct suchother investigations regarding official matters under the controlof the Department of Justice . . ." 28 U.S.C. § 533 (1994). TheFBI is in the Department of Justice. 28 U.S.C. § 531 (1994). TheAttorney General has formally delegated to the Bureau theauthority to "[i]nvestigate violations of the laws, including thecriminal drug laws, of the United States and collect evidence incases in which the United States is or may be a party ininterest, except in cases in which such responsibility is bystatute or otherwise specifically assigned to anotherinvestigative agency." 28 C.F.R. § 0.85(a) (1999).

The use of informants is a traditional and important means ofdetecting crime and developing the evidence necessary toprosecute criminals successfully. Confidentiality is recognizedas critical to developing informants. See, e.g., Roviaro v.U.S., 353 U.S. 53, 59, 77 S.Ct. 623, 1 L.Ed.2d 639 ("[B]ypreserving their anonymity" citizens are encouraged tocommunicate their knowledge of crimes to law enforcementofficials and thus promote the public interest in effective lawenforcement.). Therefore, the FBI's authority to investigatecrime naturally entails the power to develop and utilizeinformants.

There is no statute, regulation, or order that restricts theFBI's right to promise informants confidentiality. To thecontrary, the Attorney General's Guidelines and other provisionsof the FBI Manual expressly recognize that the FBI has thatauthority. As described more fully in § II.6, supra, FBI agentshave long been instructed to advise every informant that theBureau would "take all possible steps to maintain the fullconfidentiality of the informant's relationship with the FBI."Ex. 274 (Under Seal), Manual § 108 pt. I(C)(9)(d) (1-12-77). Inaddition, FBI agents have historically been instructed that"constant care should be exercised to avoid any disclosure toanyone which might result in identification of an informant orcast suspicion on an informant." Id. § 108 pt. I(C)(7)(1-12-77).

The FBI, as a practical matter, has delegated to an informant'shandler and his supervisor the authority to make all decisionsregarding the informant. § II.6, supra. Even since the issuanceof the Attorney General's Guidelines in 1977, the handler and hissupervisor have made the decisions and recommendations for whichthe SAC was, on paper, responsible. §§ II.6, II.21, supra.Thus, an agent, at least with the approval of his supervisor,could properly promise an informant confidentiality and, in theprocess, implicitly assure him that nothing he told the FBI wouldbe used against him if doing so would disclose his cooperationwith the FBI.

Flemmi understood that his relationship with the FBI would notbe disclosed to anyone outside the Bureau without his consent. Asdescribed with particularity in this Memorandum, he was treatedby the representatives of the FBI with whom he dealt primarily asa friend and ally rather than as an informant. He did not realizethat he was ever opened or closed as an informant. Nor did heknow that any of the information that he provided the FBI wasbeing memorialized in writing. Flemmi was never told thatanything he said to the FBI could be used against him.

The FBI's promise to Flemmi that his status as an informantwould be kept confidential established an agreement that nothingthat he said would be used against him if such use would entailidentifying Flemmi as an FBI source. In return for this promise,among other things, Flemmi rendered very valuable services to thegovernment. Therefore, it would have been a violation of thatagreement for the government to have presented statements thatcould identify Flemmi as an FBI source to the grand juries thatindicted him. As indicated earlier, additional evidence will benecessary to determine whether this was done and, if so, whatremedy, if any, is required.

Ordinarily, it would also violate Flemmi's agreement with thegovernment to permit any of his statements that might identifyFlemmi as an informant to be admitted against him at trial,notwithstanding the fact that his relationship with the FBI is nolonger confidential. In general, such statements would beinadmissible hearsay except for the fact that they were made byFlemmi himself. See Fed. R.Evid. 801(d)(2)(A).

In the instant case, Flemmi's history as an informant is nowknown. Flemmi did not, however, initiate the revelation that hewas an informant. Having obtained Flemmi's indictment, thegovernment disclosed his status to the magistrate judge in theprocess of seeking guidance concerning its discovery obligations.This court eventually found the sealed submissions and Ordersrelating to that request. Thus, the court asked Flemmi privatelyif he was willing to have his counsel and codefendants told thathe was an informant. See Salemme, 978 F. Supp. at 351 n. 3; Apr.16, 1997 Tr. at 118-22 (Under Seal). In the circumstances, anissue exists concerning whether Flemmi's acknowledgment that hewas an informant can properly be characterized as a voluntarywaiver of the rights that he had under his agreement with the FBIthat his status would be kept confidential and statementsattributable to him would not be used against him. Cf. Roviaro,353 U.S. at 60, 77 S.Ct. 623 (with regard to the informer'sprivilege, "once the identity of the informer has been disclosedto those who would have cause to resent the communication, theprivilege is no longer applicable.").

It is, however, not necessary to decide this question now. Itis not clear whether the government will seek to introduce any ofFlemmi's statements on the theory that he had voluntarily waivedhis right to confidentiality. More importantly, Flemmi hasexpressed his intention to contend at trial that his conduct nowalleged to be criminal was authorized by the FBI. It is alsoforeseeable that he will rely on a claim of entrapment byestoppel, which like his authorization defense will requireFlemmito present evidence of some of his communications with the FBI.

If Flemmi offers some of the written records of his statementsto the FBI, the government will be entitled to introduce "anyother part [of a particular document] or any other writing orrecorded statement which ought in fairness to be considered . .." Fed.R.Evid. 106. Thus, the government may introduce additionaldocuments reflecting Flemmi's statements if "`necessary toqualify'" the documents, or portions, of them introduced byFlemmi. United States. v. Branch, 91 F.3d 699, 728 (5th Cir.1996) (quoting United States v. Pendas-Martinez, 845 F.2d 938,944 (11th Cir. 1988)).

"While Rule 106 by its terms applies only to writings andrecordings, the principle of completeness embodied in the Rulehas been applied to the introduction of oral out-of-courtstatements as well." 1 S. Saltzburg, Federal Rules of EvidenceManual (7th ed. 1998) at 99. In essence, Federal Rule ofEvidence 611(a) "imposes an obligation for conversations similarto what Rule 106 does for writings." Branch, 91 F.3d at 728(citing United States v. Haddad, 10 F.3d 1252, 1258 (7th Cir.1993) and United States v. Castro, 813 F.2d 571, 576 (2d Cir.1987)). Accordingly, as the Court of Appeals for the SecondCircuit said in Castro:

whether we operate under Rule 106's embodiment of the rule of completeness, or under the more general provision of Rule 611(a), we remain guided by the overarching principle that it is the trial court's responsibility to exercise common sense and a sense of fairness to protect the rights of the parties while remaining ever mindful of the court's obligation to protect the interest of society in the "ascertainment of the truth." Fed.R.Evid. 611(a).

813 F.2d at 576.

Accordingly, although Flemmi may otherwise have a right topreclude his statements to the FBI that could disclose his statusas an informant from being offered against him at trial, if hepersists in his intention to introduce some of those statementshimself, the government will be permitted to offer any of hisother statements that are necessary to the fair "ascertainment oftruth."

(3) Flemmi Had an Enforceable Agreement Relating to 98 Prince Street, Vanessa's, and 34 Guild Street

Flemmi also contends that he was, expressly and implicitly,promised that in return for his contributions to the bugging of98 Prince Street that none of the evidence intercepted therewould be used against him, directly or indirectly, and thispromise is enforceable. As set forth below, this contention iscorrect. In addition, Flemmi asserts that he had an agreementimplied in fact from the promise concerning 98 Prince Street andthe conduct of the government that there would be no direct orindirect use against him of the intercepted evidence that hehelped the FBI obtain at Vanessa's and 34 Guild Street. Thisassertion is also accurate.

Contrary to the government's claim, the FBI agents who dealtwith Flemmi had the actual authority to grant the immunitypromised to him. As described in detail below, the cases in whichpromises of informal immunity made by agents without theinvolvement of any prosecutor have been held to be unenforceableare distinguishable from the instant case in decisive respects.More specifically, they each involved individuals who were underactive investigation or arrest and asked to cooperate in adiscrete matter rather than persons, like Flemmi, approached andcultivated to serve as long term informants. See, e.g., UnitedStates v. Kettering, 861 F.2d 675, 676 (11th Cir. 1988)(indicted defendant); United States v. Hudson, 609 F.2d 1326,1327 (9th Cir. 1979) (individual under arrest); Streebing, 987F.2d at 371 (target of investigation).

In addition, in the foregoing cases, relief was denied in partbecause the governmentdid not use the defendant's statements directly or indirectlyagainst the defendant, either in presenting the case to the grandjury or in prosecuting the case at trial, and it was, therefore,found that he had not relied to his detriment on the lawenforcement agent's promise. Kettering, 861 F.2d at 678-80;Hudson, 609 F.2d at 1329; Streebing, 987 F.2d at 372-73. Incontrast, evidence intercepted at 98 Prince Street and 34 GuildStreet was presented to the grand juries which indicted Flemmi.Derivative use of that evidence, and of the evidence interceptedat Vanessa's, may also have been made to secure Flemmi'sindictment. Moreover, the government proposes to introduce theinterceptions from 98 Prince Street, Vanessa's, and 34 GuildStreet against Flemmi at trial.

As described in § II.11, supra, when Morris and Connollyasked Flemmi and Bulger to go to 98 Prince Street to acquireinformation on the layout of the premises, including the doors,locks, and security devices, in order to assess the feasibilityof installing a bug, Flemmi and Bulger expressed two concerns.One was a well-founded fear for their safety. The other concernwas about what would be done with any evidence intercepted at 98Prince Street regarding Bugler and Flemmi.

As described in § II.11, supra, Morris and Connolly assuredBulger and Flemmi that the 98 Prince Street tapes would not be aproblem for them. Flemmi Aug. 26, 1998 Tr. at 184-86, Aug. 20,1998 Tr. at 43-45. They said Bulger and Flemmi would be protectedfor anything picked up on those tapes, rather than prosecuted.Id. These assurances were not qualified in any way.

Thus, Flemmi understood that nothing on the 98 Prince Streettapes would be used against him. Flemmi Aug. 26, 1998 Tr. at189-90. This understanding was reasonable. Hogan, 862 F.2d at388. Flemmi relied on it in going to 98 Prince Street to obtainthe logistical information that the FBI requested and inproviding additional information that the government used toobtain the warrant to bug 98 Prince Street.

Moreover, in view of what Flemmi was told, and the fact thatneither Morris nor Connolly said that indirect use of theevidence intercepted at 98 Prince Street would be made againsthim, it was fair for Flemmi to understand that if he helped theFBI in its effort to bug 98 Prince Street, he would not be harmedin any way, including by the derivative use of evidenceintercepted there. This conclusion is reinforced by the principlethat:

The common understanding of "use immunity" in the criminal justice world is that it encompasses derivative use immunity. Although, the Supreme Court's thorough discussion of use immunity in Kastigar carefully distinguishes between use immunity and the broader derivative use immunity, 406 U.S. at 442, 450, 453, 92 S.Ct. at 1655, 1659, 1661, the two now almost always arise together in federal courts; statutory immunity, requiring both use and derivative use immunity, 18 U.S.C. § 6002, is much more common than informal immunity. Consequently, it is not uncommon for courts to define use immunity as including derivative use immunity even when informal, rather than statutory, immunity is involved. See, e.g., United States v. Pelletier, 898 F.2d 297, 302 (2d Cir. 1990) ("The specific terms of these agreements contemplated use, rather than transactional, immunity and thus prohibited the government's direct or derivative use of the immunized testimony."); United States v. Harvey, 869 F.2d 1439, 1444 (11th Cir. 1989) ("Use immunity prohibits the use of compelled testimony, or any evidence derived directly or indirectly from that testimony, against the witness in a criminal prosecution."). Even Special Agent Gary F. Deak, who participated in the interview of Mr. Plummer, testified that in five years experience he had "never been involved with an immunity that allowed for the use of the fruits of the leads. So I wouldn't even have any occasion to consider that."

Plummer, 941 F.2d at 804 (emphasis added). Therefore, as theCourt of Appeals for the Ninth Circuit has stated, "if thegovernment informally promises that . . . statements will not beused against the defendant, it is also precluded from using thestatements to uncover other incriminating evidence, unless theagreement expressly provides otherwise." Dudden, 65 F.3d at1467.

The promise made to Flemmi and Bulger, in 1980, concerning theinterceptions at 98 Prince Street was reaffirmed in 1985. §II.18, supra. At the April 1985 dinner at Morris' home, Flemmiand Bulger, knowing that they had been discussed in some of theconversations intercepted at 98 Prince Street, again questionedwhether the information on those tapes might be used against themin any investigation or prosecution. Flemmi Aug. 20, 1998 Tr. at14-15, Aug. 26, 1998 Tr. at 153-56. Once again, Morris andConnolly told them not to worry because they would not beprosecuted for anything on the tapes. Id. Morris went on totell Bulger and Flemmi, "you can do anything you want as long asyou don't clip anyone." Id.; Ex. 92, ¶ 2.

The FBI generally, and Morris and Connolly particularly, hadimplied actual authority to make the foregoing promise ofimmunity to Flemmi and Bulger. The authority to grant immunity isshared, rather than vested solely in the United States Attorney.A statutory grant of immunity may be sought by the United StatesAttorney only with the approval of the Attorney General oranother, specified high official of the Department of Justice.28 U.S.C. § 6003 (1994). The Attorney General and the United StatesAttorney each have independent statutory authority to prosecutefederal crimes. Thomas, 35 F.3d at 1339; 28 U.S.C. § 515(a),547 (1994). Incidental to that, each also has the implied actualauthority to enter into plea bargains and comparable agreements,including agreements to grant immunity informally, without theparticipation of the other. Id.

As described in § III.1.D(2), supra, the Attorney General'spower to investigate and prosecute criminal activity is delegableto agencies within the Department of Justice. 28 U.S.C. § 510,533 (1994). The power to investigate violations of federal lawgenerally has been delegated to the FBI. 28 C.F.R. § 0.85 (1999).The authority to investigate federal crime inherently entails thepower to develop and utilize informants.

As indicated in § II.6, supra, there is no statute thatprohibits the Attorney General from delegating to the FBI hispower to informally promise use immunity, among other things, toinformants. Nor is there any statute that prohibits the FBI fromreceiving or exercising such authority.

In addition, there is no regulation, having the force of law,which prohibits the FBI from properly promising an informant useimmunity to obtain or maintain his services. This contrasts withthe power of the Attorney General to admit individuals to theWitness Protection Program which, during the relevant period, byregulation, was expressly and exclusively delegated to the UnitedStates Marshals Service. See 28 C.F.R. § 0.111(C) (1979);Department of Justice Order OBD 2110.2 P 7(d) (Jan. 10, 1975);Civiletti, 635 F.2d at 90; Thomas, 35 F.3d at 1339. As theCourt of Appeals for the Ninth Circuit has said:

Doe v. Civiletti, 635 F.2d 88, 90 (2d Cir. 1980), holds that the oral representations of a Strike Force Justice Department attorney and a DEA agent did not commit the Marshals Service with regard to the Witness Protection Program. Their lack of authority was express, under an Attorney General's order that attorneys and others "are not authorized" to make such commitments, which were to be made by "authorized representatives of the U.S. Marshals Service only." Id. No comparable order or other express restriction of authority has been shown to us in this case.

Thomas, 35 F.3d at 1339. Similarly, no comparable order orexpress restriction on the Attorney General's power to delegateto the FBI the authority to grant informants immunity informallyhas been shown in the instant case.

This conclusion is not qualified by the existence of the LeviGuidelines, which were part of the FBI Manual in 1980 when Morrisand Connolly promised Flemmi that the information intercepted at98 Prince Street would not be used against him. "[T]he SupremeCourt [has] held that intra-office manuals, unlike officialregulations, have no legal force." Kugel v. United States,947 F.2d 1504, 1507 (D.C.Cir. 1991) (citing Schweiker v. Hansen,450 U.S. 785, 789, 101 S.Ct. 1468, 67 L.Ed.2d 685 (1981)).Consistent with this principle, the Guidelines did not have theforce of law. Rather, as was understood when they were issued in1976, and as expressly clarified in 1981, the Guidelines did not"create any rights . . . enforceable at law" or "place anylimitations on otherwise lawful investigative and litigativeprerogatives of the Department of Justice," including the FBI.Ex. 274 (Under Seal), Manual § 137-17(N) (1-12-81). See alsoKugel, 947 F.2d at 1507.

As described in § II.6, supra, prior to the issuance of theLevi Memorandum, the Department of Justice did not have anyinstitutionalized role in the FBI's use of informants. Itappears, however, that the FBI occasionally sought legal advicefrom the Department of Justice on issues relating to them. Forexample, from at least 1961 until the issuance of the LeviMemorandum the FBI's Manual of Instructions stated that:

On 7-10-52 the Department furnished an opinion regarding the question whether an informant could be prosecuted for technically violating the law while attempting to obtain evidence regarding a Federal violation. The Department stated ". . . If the intent throughout was to assist the government agents in the enforcement of the law, and not to violate or to `cover-up' for a violation of the law, it is not believed a case for prosecution could be made against such an informer. . . ."

The procedures to be followed by informers working under the supervision of your agents in the aid of enforcing the statutes coming within your jurisdiction largely rests upon your sound discretion. . . . It is not believed that an informer would be otherwise immune from prosecution for actions which would subject a Federal enforcement officer to prosecution.

Id. § 108(K) (10-13-61) (emphasis added); Ex. 275 (Under Seal).Prior to the promulgation of the Levi Memorandum, the Manual ofInstructions also included the direction that:

Care must be exercised in attempting to persuade individuals to act as informants to avoid any allegations of undue influence. An individual who is in custody and who offers to furnish information generally does so in the hope that he will receive some consideration in return. Bureau agents cannot promise any immunity or any reduction in sentence to a criminal who furnishes information and they must not put themselves in a situation where they might subsequently be accused of having done so.

Id. § 108(D)(4)(11-29-55 through 5-13-76) (emphasis added).

Read together, these provisions, among other things, indicatethat prior to the Levi Memorandum the procedures to be employedin dealing with informants were at all times in the solediscretion of the FBI. Consultation with Department of Justiceattorneys was not required. Indeed, such consultation with regardto an identified individual would have been inconsistent with thehistoric direction to FBI agents that: "Constant care must beexercised to avoid any disclosure to anyonewhich might permit identification of a criminal informant or evencast suspicion on a criminal informant." Id. §108(I)(8)(12-11-59). FBI agents were admonished not to promiseimmunity or a reduction of sentence to "criminals" in custodywhose cooperation was being sought. The FBI could, however,authorize informants who were not incarcerated to engage in whatwould otherwise be criminal activity without the involvement ofDepartment of Justice attorneys. Id. § 108(K) (10-13-61).

The Levi Guidelines also recognized that the handling of FBIinformants remained solely the responsibility of the FBI. Morespecifically, the Levi Memorandum stated that:

Informants as such are not employees of the FBI, but the relationship of an informant to the FBI imposes a special responsibility upon the FBI when the informant engages in activity where he has received, or reasonably thinks he has received, encouragement or direction from the FBI.

Id. § 137-17(N)(1-12-77) (emphasis added). As this statementreflects, the Attorney General understood that the Department ofJustice had no role or responsibility in giving FBI informantsdirection or in providing the assurances that might be necessaryto influence informants to follow those directions. That wassolely the responsibility of the FBI, which was advised by theAttorney General to be careful in exercising its authority.

Consistent with the Attorney General's understanding, the LeviGuidelines provided no role for Department of Justice attorneyswith regard to FBI informants. The FBI alone retained the powerto decide whether to use someone as an informant. Id. § 108 pt.IV(A)(5)(1-12-77)

Similarly, the Levi Guidelines indicated that the FBI alone —without the involvement of any prosecutor — could authorizeinformants to engage in criminal activity. More specifically, theLevi Guidelines provided that informants be instructed that:

in carrying out their assignments they shall not:

(4) participate in criminal activities of persons under investigation, except insofar as the FBI determines that such preparation is necessary to obtain information needed for purposes of federal prosecution.

Id. § 108 pt. IV(3)(4) (emphasis added). See also Kentucky v.Long, 837 F.2d 727, 732-33 (6th Cir. 1988) (Chief of FBICriminal Informant Unit testifies that one instruction in theLevi Guidelines was "that the informant is to be told that he orshe is not to engage in any illegal activity unless they areauthorized to do so by the FBI.") (emphasis added).

Moreover, after the issuance of the Levi Guidelines the FBIManual continued to advise agents to "avoid any disclosure toanyone" — including prosecutors — "which might result in theidentification of an informant . . ." Ex. 274 (Under Seal),Manual § 108 pt. I(C)(7) (1-12-77) (emphasis added). As reflectedthroughout this Memorandum, the FBI as an institution and each ofits agents was dedicated to not disclosing an informant'sidentity to any prosecutor without the source's consent.Department of Justice attorneys accepted the fact that the FBIwould not disclose or discuss its informants with them unlessauthorized to do so by the informant. As Weld, the former UnitedStates Attorney and Assistant Attorney General, most colorfullyput it: "In general, if I as a political appointee had gone tothe Bureau and said, `Tell me who your informants are,' I wouldhave expected them to tell me to `go pound sand.'" Weld May 26,1998 Tr. at 133.

As a practical matter, a prosecutor could not, and would not,participate in granting a person immunity without knowing thatindividual's identity. Thus, implicit in the acceptance by theAttorney General and his subordinates of the principle that theFBI was never required to disclose tothem the identity of an informant was recognition that the FBIwas not required to consult them concerning informal promises ofimmunity made to its sources. Indeed, the government has in atleast one other case implicitly acknowledged that FBI agents havethe authority to promise potential cooperating individualsimmunity. Conley, 859 F. Supp. at 859 n. 6. As the court inConley stated, "[T]he Government has not argued or attempted toprove that [FBI Special Agent] Donnelly's promise was notauthorized by a prosecutor. The Court notes the impracticalitythat could be visited upon potential agent-informantrelationships absent promises such as [FBI Special Agent]Donnelly's promise." Id.

The Levi Guidelines did attempt to provide guidance to the FBIconcerning the exercise of its power to confer immunity. They didnot, however, require that prosecutors be consulted if a promiseof immunity were contemplated. Rather, they indicated that agentswere discouraged, but not prohibited, from promising immunitythemselves. More specifically, the Levi Guidelines stated, inlanguage that endured at least until 1984, that:

Agents should not exercise undue influence in developing informants including promising immunity or reduction of sentence to criminals who furnish information.

Ex. 274 (Under Seal), Manual § 108(I)(C)(6) (1-12-77); § 137-3(6)(131-78); § 137-(3)(6) (4-2-79); § 137-5(4) (1-12-81); § 137-5(4)(9-20-82); § 137-5(4) (3-28-84) (emphasis added). Compare, id.§ 108(D)(4) ("No active military personnel can be developed asinformants") (emphasis added). As the analysis in § III.1.D(5),infra, indicates, the Attorney General's admonition concerninga promise of immunity constituting a form of "undue influence"was wise. It did not, however, operate to limit legally the FBI'spower to promise an informant immunity.

If the Attorney General intended to entrust the FBI with theauthority and discretion to develop informants, but prohibit theFBI from promising them use immunity if necessary to secure theirvaluable services, he could and should have done so clearly in apublic, legally binding regulation or Order. As indicatedearlier, such an Order was employed to prohibit United StatesAttorneys from promising admittance to the Witness ProtectionProgram and to put interested individuals on notice thatprosecutors lacked that authority. See Department of JusticeOrder OBD 2110.2, P 7(d) (Jan. 10, 1975). In contrast, the LeviGuidelines, which the government has insisted remain under sealin this case, were neither legally binding nor generallyavailable to the public. Moreover, as indicated earlier, they didnot even state to agents that the FBI lacked the authority topromise its informants immunity.

These features of the Levi Guidelines were not inadvertentoversights or the result of inartful drafting. Rather, asdescribed in § II.6, supra, the FBI has traditionally operatedwith great independence from the Attorney General. It has beenparticularly fierce in protecting its prerogatives concerninginformants. While the Levi Guidelines were an initial effort toprovide guidance to the FBI in exercising its authority, they didnot impose any legal limitations on the Bureau's power to promiselong term informants immunity.

Virgil Young, the Assistant Section Chief and Unit Chief of theCriminal Informant and Witness Security Programs Unit of the FBI,testified in another case that from the FBI's perspective, "theLevi Guidelines were unclear in many respects, with the resultthat a great deal of discretion was given to individual agents."Long, 837 F.2d at 732. As an example of this Young cited thefact that the Levi Guidelines did not "say that a particularagent can authorize [an informant's participation in illegalactivity] or can't authorize it, nor does it say thatauthorization [is] required by a special agent in charge or anyother specific individual." Id. at 732-33. Thus, at least from1977 to 1981, theFBI interpreted the Levi Guidelines to allow any agent or hissupervisor to authorize an informant to participate in otherwiseillegal activity. Id. at 733.

The evidence in this case demonstrates that Connolly and Morrishad comparable, implied actual authority to promise Flemmiimmunity. §§ II.6, II.16, II.21. As Potts, the former ActingDeputy Director of the FBI, testified, the supervisor of thehandling agent was generally the FBI's "chief decision maker"regarding informants. Potts May 22, 1998 Tr. at 7. As Greenleaftestified, the SACs generally relied completely on theinformant's handler and his supervisor even for making decisionsand recommendations for which SACs were responsible under theGuidelines. Greenleaf Jan. 8, 1998 Tr. at 136-40. In Potts'experience, Headquarters never reversed recommendations from afield office that an individual be used, or continued, as aninformant. Potts May 22, 1998 Tr. at 6-8. Nor is there anyevidence that FBI Headquarters ever inquired about what promiseshad been made to informants generally or to Flemmi and Bulgerparticularly.

As described earlier, the FBI urged agents and theirsupervisors to use "a dynamic and imaginative approach indeveloping" the Top Echelon informants necessary to combatOrganized Crime. Ex. NN (Under Seal), Manual § 108 pt. III(B)(1-12-77); § 137-12(2) (4-12-79). In 1980, Morris and Connollywould have reasonably understood that they had, even under theLevi Guidelines, the power to authorize Flemmi and Bulger toengage in criminal activity in connection with their service asinformants. When Bulger and Flemmi sought assurance that anyevidence that might be obtained if 98 Prince Street wassuccessfully bugged would not be used against them, it was, inview of all of the relevant circumstances, reasonable — andindeed correct — for Morris and Connolly to believe that theyalso had the actual authority to promise that immunity in orderto obtain the critical assistance they were seeking from Flemmiand Bulger. Restatement (Second) of Agency § 35 (1957);Greene, 995 F.2d at 800; § III.1.B, supra.68

The conclusion that Morris and Connolly had actual authority topromise the FBI's longstanding informants, Flemmi and Bulger,that any evidence obtained if 98 Prince Street was bugged wouldnot be used against them is not inconsistent with the cases onwhich the government relies. Those cases are distinguishable fromthe instant case in material respects. Indeed, the analysisemployed in those cases concerning both authority and detrimentalreliance reinforces this court's conclusion concerning theenforceability of the agreement regarding 98 Prince Street, andthe importance of the issues of Due Process and involuntarinessdiscussed, in § III.1.D(5), infra.

The government has long relied primarily on Streebing, supra,and Kettering, supra. See, e.g., Salemme 1997 WL 810057 at *2(Dec. 29, 1997). Kettering involved an indicted defendantrather than an informant. 861 F.2d at 676. The defendant and hisattorney met with a DEA agent to discuss Kettering's case. Id.The information that he provided was never recorded in a DEAreport. Id. Kettering's attorney gave the DEA a proposed letteragreement pursuant to which Kettering would plead guilty not tothe indictment against him, but to a single count informationinvolving no mandatory minimum sentence. Id. The DEA agentconsulted the Assistant United States Attorney handling the caseconcerning the proposed plea agreement. Id. The prosecutor feltthat the proposed sentence was too low and promptly informedKettering's attorney that the proposed agreement wasunacceptable. Id.

Kettering subsequently claimed, however, that the discussionswith the DEA agent had generated an enforceable plea agreement.Id. at 676-77. The District Court held that the defendant hadfailed to establish that the DEA agent had the authority to enterinto a plea agreement, despite his mistaken belief that he coulddo so. Thus, the District Court denied the motion to dismiss.Id.

The Court of Appeals for the Eleventh Circuit treated the issueof authority as a factual question and found that the DistrictCourt's finding of a lack of authority was not clearly erroneous.Id. This was one ground for affirming its decision. Id. at677-78. The Eleventh Circuit observed, however, that "if thedefendant's cooperation was induced by the misrepresented pleaagreement, the court could determine whether the statements wereinvoluntary and, if so, exclude them at trial." Id. at 679(citing United States v. Coon, 805 F.2d 822, 824-25 (8th Cir.1986)). This principle as applied to Flemmi is addressed in §III.1.D(5), infra.

In Kettering, the Eleventh Circuit also stated that, "allattorneys (prosecutors and defense counsel) and government agentsshould exercise great care in making certain that defendants areapprised of limitations in authority and the rules surroundingsuch negotiations." Id. at 678 n. 2. In the instant case,Flemmi did not have an attorney and neither Morris nor Connollysuggested that there was any limitation on their authority topromise that any evidence intercepted at 98 Prince Street wouldnot be used against him.

In addition, and significantly, in Kettering the EleventhCircuit did not rely solely on the agent's lack of authority inrefusing to find that an enforceable agreement existed. Rather,the court also relied on the fact that the defendant had failedto establish any prejudicial reliance because neither hisstatements nor any fruits of them were used against him. Id. at678-79 & n. 3. As the court wrote, "The United States SupremeCourt in Mabry v. Johnson, 467 U.S. 504, 104 S.Ct. 2543, 81L.Ed.2d 437 . . . (1984) stated that as long as the defendant isnot in a worse position, there is no detrimental reliance." Id.at 680. The Eleventh Circuit held that "[a]ny statements[Kettering] made while cooperating with [the DEA agent] could beexcluded in subsequent proceedings." Id. Thus, his cooperation"did not place him in a position where restoration of the statusquo ante would be impossible." Id. at 679.

In contrast, Flemmi relied on the assurance that any evidenceintercepted at 98 Prince Street would not be used against him. Heperformed his part of the bargain and rendered a very valuableservice to the government by providing information that wassignificant for the feasibility of bugging 98 Prince Street andthat was used to establish that the issuance of a warrant to doso was appropriate. Nevertheless, evidence intercepted at 98Prince Street, and perhaps information derived from it, waspresented to the grand juries that indicted Flemmi, and thegovernment proposes to introduce the 98 Prince Streettape-recordings at trial. Thus, Flemmi's case is not comparableto Kettering's.

Similarly, Streebing involved statements to FBI agents by anindividual who knew that he was the target of theirinvestigation. Streebing, 987 F.2d at 371. The defendantclaimed that the agents promised that he would not be prosecutedif he spoke to them. Id. The court, however, found that no suchpromise was made. Id. Rather, the defendant was told explicitlythat a prosecutor would have to decide if he would be indicted.Id. at 371-72. In addition, the government represented thatnone of the defendant's statements had been presented to thegrand jury and stipulated that none would be used at trial. Id.at 372.

Accordingly, Streebing's motion to dismiss the charges againsthim as an exercise of the court's supervisory powers was deniedbecause he was not promised that he would not be prosecuted; theFBIagents lacked the actual or apparent authority to make such apromise; and the defendant did not rely to his detriment on thepurported promise. Id. at 372-73. Essentially, for the reasonsdescribed with regard to Kettering, Flemmi's claim concerning 98Prince Street is distinguishable from Streebing's claim.

The other cases that the government relies on for the purportedproposition that as investigatory agents Morris and Connollylacked authority to promise Flemmi that evidence obtained fromthe bugging of 98 Prince Street are inapposite for similarreasons. None involves an individual who, like Flemmi, served asan FBI informant long before being indicted or targeted forinvestigation by the FBI. See, e.g., Hudson, 609 F.2d at 1327(arrested defendant); United States v. Williams, 780 F.2d 802,803 (9th Cir. 1986) (target of investigation); Johnson v.Lumpkin, 769 F.2d 630, 632 (9th Cir. 1985) (convictedindividual); Lua, 990 F. Supp. at 707 (individual offered briefopportunity to be a witness rather than a defendant in a murdercase). As explained previously, the FBI has been grantedexclusive authority to recruit informants from the generalpopulation and to provide them the assurances necessary to obtaintheir services. The courts have understandably found that lawenforcement agents do not have the same, unqualified authoritywhen the judicial process has been invoked and governmentattorneys are already involved in the matter or must beimminently. Hudson, 609 F.2d at 1327-28; Williams, 780 F.2dat 803; Johnson, 769 F.2d at 632; Lua, 990 F. Supp. at 706.

Accordingly, the court finds that Morris and Connolly wereauthorized to promise Flemmi that any evidence intercepted wouldnot be used against him if he assisted in the FBI's effort to bug98 Prince Street. Flemmi performed his part of the bargain.Nevertheless, the government claims that it should not berequired to provide Flemmi the benefit of that bargain.

More specifically, the government contends that any agreementthat Flemmi had with the government is invalid because Flemmicommitted many serious crimes, including murder, but did notcandidly disclose to the FBI all of his criminal activity. Thus,the government now claims that Flemmi breached any agreement hehad with the government by not providing the FBI with accurateand complete information concerning his own criminal activity.

From the outset, however, the FBI was under no illusions aboutthe nature of Flemmi's criminal activity. When Rico wrote to FBIHeadquarters to recommend that Flemmi be opened as an informant,he described Flemmi as the leader of the gang previously headedby Wimpy Bennett and as a person who had "been engaged inbookmaking, shylocking, robberies, and is suspect of possiblybeing involved in gangland slayings." Ex. 21. As described in §II.2, supra, Rico had good reason to suspect Flemmi hadparticipated in murder. Similarly, Connolly has stated that: "AllTop Echelon informants are murderers. The government put me inbusiness with murderers." Oct. 23, 1998 Tr. at 43; § II.33. Asdescribed in § II.4, supra, Morris not only knew from theoutset that Flemmi and Bulger were frightening figures, butattempted to exploit their reputations for violence by urgingMiani and Barrett to cooperate with the FBI in order to obtainprotection from them. Ring too was aware that Flemmi and Bulgerengaged in many serious crimes, perhaps including murder. §II.17. Potts knew that they were serious criminals as well. §II.21.

Flemmi was under no obligation to disclose to the FBI all ofhis criminal activity and, therefore, his failure to do so didnot constitute fraudulent concealment. See, e.g., Kasuri v. St.Elizabeth Hosp. Med. Ctr., 897 F.2d 845, 852 (6th Cir.1990).69The FBI did not know the details of all of Flemmi's criminalactivity in meaningful measure because its agents did not ask. AsRing explained, it was understood that Top Echelon informantswere necessarily involved in serious criminal activity; they hadto be in order to have the intimate knowledge of the LCN that theFBI was seeking. The FBI regarded it as inappropriate andcounterproductive, however, to ask an informant for the detailsof his own criminal activity because to do so might suggest thatthe FBI was investigating him and, therefore, cause him to ceaseserving as a source. § II.17.

In essence, the government's present position boils down to aclaim that any immunity agreement is invalid because the FBIagents who dealt with Flemmi and Bulger were dimwits who wereduped by their sources. In view of the facts described in thisMemorandum, this contention is utterly unconvincing. See UnitedStates v. Brown, 763 F. Supp. 1518, 1526-28 (D.Ariz. 1991),aff'd, 979 F.2d 1380 (9th Cir. 1992). In summary, the FBI'shighest priority was combating the LCN. Agents were encouraged tobe imaginative in recruiting Top Echelon informants, who bydefinition were involved in serious criminal activity themselves.It was natural that such informants would seek protection fromthe FBI, particularly including immunity for information theyprovided or helped obtain. It was also foreseeable that TopEchelon informants would be given such assurances by theirhandlers, and their handlers' supervisors, in order to securetheir services. Rico, Connolly, Morris, Ring, and theircolleagues knew the character of Flemmi and Bulger's criminalactivity. They were not defrauded in deciding to make them alliesin the FBI's war against the LCN generally or in promising themimmunity concerning 98 Prince Street particularly.

For the foregoing reasons, Flemmi had an enforceable expressand implied in fact agreement that precludes the use andderivative use against him of any of the evidence intercepted at98 Prince Street. He also had an equally valid agreement impliedin fact that the evidence intercepted at Vanessa's and 34 GuildStreet would not be used against him in any way.

In contrast to 98 Prince Street, Flemmi did not discuss withthe FBI whether any of the evidence intercepted at Vanessa's or34 Guild Street would be used against him. However, as describedin § III.1.B, the conduct of the parties may manifest the meetingof the minds necessary to infer a valid, tacit understanding infact. Hercules, 516 U.S. at 424, 116 S.Ct. 981; Baltimore &Ohio R. Co., 261 U.S. at 597, 43 S.Ct. 425; McHan, 101 F.3d at1034; Lua, 990 F. Supp. at 709. Such an agreement existed withregard to Vanessa's and 34 Guild Street.

As described in § II.20, supra, the facts relating toVanessa's are similar to those involving 98 Prince Street. In1986, Flemmi told Connolly about his visits to the storeroom atVanessa's and his discussions there with members of the LCNconcerning illegal gambling, among other things. Connolly made itclear that the FBI wanted to bug Vanessa's. Flemmi was tasked toacquire information relating to the premises that would beimportant to the feasibility of installing a bug. He providedthat information, including a diagram of Vanessa's. He and Bulgerwere also two of the three informants relied upon in theaffidavit used to obtain the warrant to bug Vanessa's. But fortheir information, the government could not have obtained thewarrant to bug Vanessa's.

Flemmi understood that in return for his services regardingVanessa's, he would have the same protection concerning anyevidence intercepted there that he had been promised concerning98 PrinceStreet. This belief was reasonable. Rico and Connolly had eachpromised Flemmi protection. Being provided immunity forinformation that Flemmi furnished or helped obtain was consistentwith that promise. Morris and Connolly had twice expresslyassured Flemmi and Bulger that they would be protected, ratherthan prosecuted, with regard to matters intercepted at 98 PrinceStreet. By 1986, that promise had been honored. Angiulo and hisallies had been prosecuted. As with the race-fix case, Bulger andFlemmi were not charged.

After the 98 Prince Street experience, no one told Flemmi thatthe ground rules had changed. Therefore, based on the foregoing,it was reasonable for Flemmi to believe that he had an agreementwith the government that any evidence intercepted at Vanessa'swould not be used against him directly or indirectly.

The court recognizes that following the bugging of 98 PrinceStreet Morris and Connolly also engaged in improper conduct inorder to provide Flemmi and Bulger protection. Morris causedConnolly to tell Bulger and Flemmi that Halloran was cooperatingwith the FBI. Connolly tipped them off to the 1984-1985 jointDEA-FBI investigation. If Flemmi had relied primarily orexclusively on such improper conduct in concluding that he had animmunity agreement with the government, that reliance would havebeen unreasonable and the court would not enforce the purportedagreement. Kiely, 105 F.3d at 737. However, in the instant casethere were ample, legitimate reasons for Flemmi to reasonablybelieve that the immunity he had been promised and providedconcerning 98 Prince Street also extended to Vanessa's. As herelied on this reasonable belief, that agreement implied in factwill be enforced.

The government has represented that the Vanessa's recordingswere not presented to the grand juries that indicted Flemmi. Gov.Submission Pursuant to 6/21/99 Court Order, ¶ 5. As discussed in§ III.1.D(4), infra, Flemmi correctly contends, however, thatit would have been impermissible for any evidence derived fromthe Vanessa's intercepts to have been presented to those grandjuries. In addition, the agreement implied in fact on whichFlemmi relied precludes use of the Vanessa's intercepts, or anyevidence derived from them, at trial.

The analysis and conclusion concerning Vanessa's is equallyapplicable to the evidence intercepted at 34 Guild Street, whichwas presented to the grand juries which indicted Flemmi. Id.Once again, prior to providing the FBI information used to obtainthe warrant used to bug 34 Guild Street, Flemmi was not told thatthe ground rules had changed. In 1989, there remained asubstantial, legitimate basis for Flemmi to have reasonablybelieved that if he assisted the FBI in its effort to interceptthe forthcoming Mafia induction ceremony neither that evidencenor any evidence derived from it would be used against him. Anymisconduct by the FBI to protect Flemmi after 1986, does notalter this fact. Flemmi relied on the reasonable belief that hewould be protected rather than prosecuted if he helped the FBIbug such a ceremony in performing his part of the bargain. Thus,the use of the 34 Guild Street interceptions to secure Flemmi'sindictment violated his agreement with the government. Whetherany remedy for that violation is required remains to bedetermined. The government may not, however, use the evidenceintercepted at 34 Guild Street, or any evidence derived from it,against Flemmi at trial.

The court has considered whether the conclusion that Flemmi hadan immunity agreement concerning the evidence intercepted at 98Prince Street, Vanessa's, and 34 Guild Street is qualified by theprinciple that agreements that require the commission of anillegal act are not enforceable. It is not.

The Court of Appeals for the First Circuit has held that an"alleged contract . . .to achieve mutual benefit from the parties' cooperative violationof the law. . . . even if explicitly agreed to by both parties,is void and unenforceable as against public policy. . . . Itwould have been unreasonable for [plaintiff] to rely on such anillegal contract." Kiely, 105 F.3d at 736-37. See alsoRestatement (Second) of Contracts § 178 (1979). As the courtexplained during the hearings in this case, if a violation of thepromise of protection — including a promise to tip off Flemmi toinvestigations and imminent indictments — were proven, a seriousquestion would be presented concerning whether any or all of thatagreement should be deemed enforceable. However, for the reasonsdescribed in § III.1.D(1), supra, the facts do not place thisissue before the court.

An agreement providing immunity in exchange for cooperationdoes not inherently, or typically, involve a cooperativeviolation of the law. The power to make such promises isimportant to effective law enforcement. Thus, the government mayinformally grant an individual immunity. Harvey, 869 F.2d at1443. Ordinarily, Due Process requires that such promises behonored rather than abrogated. Id.

As described in §§ II.13, II.17, and II.18, supra, Morrisaccepted three payments, totaling $7000, and several gifts fromBulger and Flemmi. Therefore, the court has particularlyconsidered whether Flemmi's immunity agreement, or any element ofit, should not be enforced.

When Morris and Connolly promised Flemmi and Bulger immunityconcerning 98 Prince Street in 1980, no payment had been made toMorris. That promise was not the product of any bribe or corruptconduct proven in this case. The first $1000 payment to Morriswas made, at his request, in June 1982. § II.13, supra. Asdescribed previously, this payment was sought and received abouta month after Halloran was murdered. Id. Thus, there is aquestion, that cannot be answered on the present record, ofwhether the initial $1000 payment was an illegal gratuity givenfor Morris' tip concerning Halloran's cooperation. See18 U.S.C. § 201(c)(1)(A) (1994); United States v. Sun-DiamondGrowers of Cal., 526 U.S. 398, 119 S.Ct. 1402, 1407, 143 L.Ed.2d576 (1999).70 That payment was not, however, made inconnection with the immunity promised concerning 98 PrinceStreet, Vanessa's, or 34 Guild Street.

The second $1000 payment, delivered by Connolly to Morris witha case of wine, was made in the spring of 1984. § II.17, supra.As described previously, the timing of this payment raises aquestion whether it was an expression of appreciation for anyassistance Morris may have rendered Bulger and Flemmi concerningthe investigation then being led by the DEA. Id. However, ittoo was not a payment relating to the immunity promised to Flemmiconcerning 98 Prince Street, Vanessa's, or 34 Guild Street.

The third payment of $5000, which was characterized as a"loan," was made to Morris, by Bulger, in April 1985, at thedinner at Morris' home that may have been held to celebrate thefailure of the 1984-1985 joint investigation of Bulger andFlemmi. § II.18, supra. Prior to the payment being made, Morrisand Connolly did reaffirm that Bulger and Flemmi would not beprosecuted for anything on the 98 Prince Street tapes and Morriswent on to tell Bulger and Flemmi that, "you can do anything youwant as long as you don't clip anyone." Id. At that point,however, Flemmi and Bulger had alreadyrelied on the earlier, untainted promise that any evidenceintercepted at 98 Prince Street would not be used against themand the government had already derived great benefit from theservices that they rendered in reasonable reliance on thatpromise. There was also, by then, a history of the agents andtheir sources exchanging gifts. The $5000 "loan" was an extensionof this practice. In the circumstances, it would be unfair andimproper to deprive Flemmi of the benefit of his bargain with thegovernment concerning 98 Prince Street because of the paymentsmade to Morris.

There were no payments made to Morris after 1985. Nor, asdescribed earlier, was the issue of immunity concerning Vanessa'sor 34 Guild Street discussed. In the circumstances, the paymentsto Morris cannot be deemed to be a bribe paid to obtain thatimmunity. See Sun-Diamond Growers of Cal., 119 S.Ct. at 1406("[F]or bribery there must be a quid pro quo — a specific intentto give or receive something of value in exchange for an officialact.").

The court does not suggest that the payments from Bulger andFlemmi to Morris were appropriate or that the acceptance ofpayments by an FBI agent from informants should be condoned.However, as explained in this Memorandum, the FBI's interest inBulger and Flemmi was founded on the invaluable assistance thatthey provided in the FBI's war against the LCN, among otherthings. The payments to Morris were not material. Rather, theywere incidental to a relationship that was important to the FBIfor valid, professional reasons. The government derived greatbenefit from the services Flemmi rendered regarding 98 PrinceStreet, Vanessa's, and 34 Guild Street. In the circumstances, itwould be fundamentally unfair to deprive Flemmi of the immunitythat he was expressly and implicitly promised because of thepayments initially sought, and ultimately received, by Morris.

(4) A Hearing Will Be Necessary to Determine If This Case Must Be Dismissed and, If Not, Whether Any Evidence Must be Excluded at Trial

In view of the foregoing, Flemmi had an enforceable agreementconcerning the evidence intercepted at 98 Prince Street,Vanessa's, and 34 Guild Street. Flemmi was expressly promisedthat he would be protected rather than prosecuted if he helpedthe FBI bug 98 Prince Street, and had the same agreement impliedin fact concerning Vanessa's and 34 Guild Street. Nevertheless,evidence intercepted at 98 Prince Street and 34 Guild Street waspresented to the grand juries that indicted Flemmi, and evidencederived from all three bugs may have been used to secure thecharges against him. Thus, there is an issue of what, if any,remedy is required in the circumstances.

Flemmi contends that this case should be dismissed as againsthim. In essence, he argues that he, like every other citizen, isentitled to Due Process and that dismissal is necessary toprovide the performance of his agreement with the government thatfundamental fairness requires. Flemmi analogizes the instant caseto Rowe, in which the Court of Appeals for the Eleventh Circuitstated with regard to an agreement not to prosecute:

as a matter of fair conduct, the government ought to be required to honor such an agreement when it appears from the record that: (1) an agreement was made; (2) the defendant has performed on his side; and (3) the subsequent prosecution is directly related to offenses in which the defendant, pursuant to the agreement, either assisted with the investigation or testified for the government.

Rowe, 676 F.2d at 527-28. The instant case, however, isdistinguishable from Rowe because it does not involve anagreement not to prosecute at all. Nevertheless, Flemmi's DueProcess argument requires continued consideration.

Flemmi's Due Process claim is reinforced by the related issueof whether the case against him should be dismissed as anexercise of the court's supervisory powers. Such powers must beexercised sparingly. United States v. Stokes, 124 F.3d 39, 45(1st Cir. 1997), cert. denied, 522 U.S. 1139, 118 S.Ct. 1103,140 L.Ed.2d 156 (1998); United States v. Santana, 6 F.3d 1, 10(1st Cir. 1993). However, as the Supreme Court wrote in UnitedStates v. Williams, 504 U.S. 36, 46, 112 S.Ct. 1735, 118 L.Ed.2d352 (1992):

Bank of Nova Scotia v. United States, 487 U.S. 250, 108 S.Ct. 2369, 101 L.Ed.2d 228 (1988), makes clear that the supervisory power can be used to dismiss an indictment because of misconduct before the grand jury, at least where that misconduct amounts to a violation of one of those "few, clear rules which were carefully drafted and approved by this Court and by Congress to ensure the integrity of the grand jury's functions," United States v. Mechanik, 475 U.S. 66, 74, 106 S.Ct. 938, 943, 89 L.Ed.2d 50 (1986) (O'Connor, J., concurring in judgment).

The Supreme Court identified as two of those few clear rules,18 U.S.C. § 6002 et seq., the federal immunity statute, and18 U.S.C. § 2515, which prohibits grand jury use of unlawfullyintercepted communications. Id. at n. 6, 112 S.Ct. 1735. Inthis case, Flemmi's rights are not rooted in those statutes, buthe was promised protection that is more expansive than thatprovided by § 6002 et seq., and evidence obtained by electronicsurveillance was used against him in violation of that promise.Thus, the implications of Williams for this case in its presentposture must also be addressed by the parties and considered bythe court.

It is not now clear whether dismissal should be ordered asnecessary to provide Flemmi Due Process or as an exercise of thecourt's supervisory powers. In United States v. Gallo,859 F.2d 1078, 1084 (2d Cir. 1988), the Court of Appeals for the SecondCircuit declined to dismiss a case in which the defendant wasgranted immunity pursuant to 18 U.S.C. § 6002, his immunizedtestimony was included in a successful application for a wiretapwarrant, and evidence intercepted by that wiretap wasinadvertently presented to the grand jury that indicted him. InGallo, the court found that the wiretap would have beenobtained even without the immunized information provided by thedefendant and deemed the errors made to be "harmless." Id. at1083.

The extent to which the facts of the instant case are analogousto Gallo is not now evident. At a minimum, however, the promisemade to Flemmi — that he would be protected rather thanprosecuted if he helped the FBI in its effort to bug 98 PrinceStreet, Vanessa's, and 34 Guild Street — is broader than the useimmunity at issue in Gallo. This may have implications for theresult in this case even if Gallo is regarded as rightlyreasoned.

It would, however, be premature to decide now whether this caseshould be dismissed to afford Flemmi Due Process or as anexercise of the court's supervisory powers. At a minimum, Flemmiis entitled to a hearing to determine whether this case should bedismissed against him because tainted evidence was presented tothe grand juries that indicted him and this error was notharmless. The resolution of this issue may present another, or analternative, ground for ordering the dismissal that Flemmirequests.

More specifically, in Kastigar, 406 U.S. at 461, 92 S.Ct.1653, the Supreme Court held that testimony compelled by a grantof immunity pursuant to § 6002 "can in no way lead to theinfliction of criminal penalties." Thus, an individual compelledto testify pursuant to § 6002 is provided with use and derivativeuse immunity. Id. at 453, 92 S.Ct. 1653. Such immunity"prohibits the prosecutorial authorities from using the compelledtestimony in any respect, and it therefore insures that thetestimony cannot lead to the infliction of criminal penalties onthe witness." Id.

It has been generally held that, "the logic of Kastigar —that 18 U.S.C. § 6002 should be sufficiently broad toprotect an individual from being compelled to testify againsthimself — applies to grand jury proceedings as well as totrials." Palumbo, 897 F.2d at 249. See also United States v.North, 920 F.2d 940, 947-49 (D.C.Cir. 1990) (en banc) ("grandjury may not consider immunized testimony or evidence derivedfrom it"); In re Grand Jury Proceedings Kinamon v. UnitedStates, 45 F.3d 343, 347 (9th Cir. 1995) ("prohibition againstthe use of immunized testimony covers such use at grand juryproceedings as well as at trial"); Schmidgall II, 25 F.3d at1536-37 ("focus on the evidence actually used by the governmentin obtaining the indictment is a correct application ofKastigar"); United States v. Pelletier, 898 F.2d 297, 301 (2dCir. 1990) ("A challenge to an indictment on the basis that itwas improperly obtained through the use of immunized testimony istimely under rule 12(b)"); United States v. Tormos-Vega,656 F. Supp. 1525, 1535 (D.P.R. 1987).

Except in certain circumstances, discussed below, the remedyfor presenting to a grand jury evidence obtained directly orindirectly as a result of a grant of immunity is dismissal of theindictment. North, 920 F.2d at 947-49; Poindexter, 951 F.2dat 377; Schmidgall II, 25 F.3d at 1538-39; Pelletier, 898F.2d at 303; United States v. Holloway, 74 F.3d 249, 253 (11thCir. 1996); Tormos-Vega, 656 F. Supp. at 1535-37. As the Courtof Appeals for the District of Columbia Circuit explained inNorth, there is a distinction between presenting to a grandjury evidence that has been wrongfully obtained in violation of adefendant's constitutional rights and a violation of a legallypermissible promise of immunity. 920 F.2d at 948-49. While,pursuant to Calandra, 414 U.S. at 354, 94 S.Ct. 613,suppression at trial is deemed to be a sufficient and appropriateremedy if illegally obtained evidence has been presented to thegrand jury, it is not adequate if information that has beenlegally obtained as a result of a promise of immunity ispresented to the grand jury. Id. See also United States v.North, 910 F.2d 843, 868-70 (D.C.Cir. 1990), vacated in part,superseded in part, 920 F.2d 940 (D.C.Cir. 1990); United Statesv. Garrett, 797 F.2d 656, 661 (8th Cir. 1986); United States v.Hampton, 775 F.2d 1479, 1489 (11th Cir. 1985); United States v.Beery, 678 F.2d 856, 860 (10th Cir. 1982).71

The principle that the government may not present to the grandjury that indicted a defendant information obtained, directly orindirectly, as a result of a grant of immunity is not limited tocases involving formal immunity provided by operation of § 6002.It is equally applicable to informal promises of immunity,including oral promises. See, e.g., Holloway, 74 F.3d at252 (oral assurance that there would be no criminal prosecutionif defendant testified in a civil deposition); Schmidgall I, 25F.3d at 1526 (oral promise of use and derivative use immunity);Schmidgall II, 25 F.3d at 1535 (same); Palumbo, 897 F.2d at248 (informal grant of immunity).

As indicated earlier, the pertinent promises to Flemmi includedthe assurance that information that he provided to assist the FBIin its efforts to bug 98 Prince Street, Vanessa's, and 34 GuildStreet, and any information directly or indirectly derived fromthat information, would not be used against him. The Court ofAppeals for the Second Circuit has characterized the use ofinformation obtained as a result of a promise of immunity in anapplication for court authorization to obtain evidence againstthe witness as a "direct use" that "is plainly a violation of thewitness's Fifth Amendment rights." Nanni, 59 F.3d at 1431(citing Pelletier, 898 F.2d at 303; Gallo, 859 F.2d at 1082).It appears to this court that such a use might be more properlycharacterized as "indirect." However, whether deemed "direct" or"indirect" use, the presentation of evidence intercepted at 98Prince Street and 34 Guild Street to the grand juries whichindicted Flemmi alone requires a hearing to determine whetherthis case must be dismissed.

In addition, as described in § II.32, supra, at least twowitnesses before the grand juries were exposed to informationrecorded by the FBI that Flemmi had provided, raising thequestion of whether their testimony was tainted by exposure toinformation obtained as a result of a promise of immunity. Morespecifically, the government has represented that Buckley readall of Flemmi's informant file and Walther reviewed part of it.In addition, Gamel read Bulger's informant file, which may haveincluded information provided by Flemmi when he and Bulger weremeeting with the FBI during periods when Flemmi wasadministratively closed as an informant.

"The protection against self-incrimination is violated wheneverthe prosecution presents a witness whose testimony is shaped —directly or indirectly — by immunized [information] regardless ofhow or by whom the witness was exposed to that [information]."Schmidgall I, 25 F.3d at 1528. See also North, 920 F.2d at942, 949; United States v. Byrd, 765 F.2d 1524, 1529 (11th Cir.1985). Thus, the fact that grand jury witnesses were exposed toFlemmi's informant file, which contains information that heprovided after receiving promises including use and derivativeuse immunity, is another reason that a Kastigar analysis isrequired to decide Flemmi's motion to dismiss. North, 920 F.2dat 948-49 n. 9; North, 910 F.2d at 866-67.

In addition, information obtained as a result of a grant ofimmunity may not be used as an "investigatory lead." Kastigar,406 U.S. at 460, 92 S.Ct. 1653; Schmidgall II, 25 F.3d at 1537.This means, among other things, that such information may not beused to identify potential witnesses or shape the questioning ofthem. Schmidgall II, 25 F.3d at 1537. The question whether thisoccurred must also be addressed in the instant case.

Accordingly, an adversary hearing to address the foregoingissues is necessary. United States v. Zielezinski,740 F.2d 727, 734 (9th Cir. 1984) ("The government cannot simply providetranscripts to the court, in camera, and assume that it has metits Kastigar burden. Only a hearing can convincingly establishthat the command of the Fifth Amendment has been satisfied.") Atthat hearing, the government will have the burden of proving,most likely by a preponderance of the evidence, that theinformation it presented to secure the indictments of Flemmi wasnot tainted by showing that it had an independent, legitimatesource for that evidence. Kastigar, 406 U.S. at 460, 92 S.Ct.1653; Schmidgall I, 25 F.3d at 1530-31; Bartel, 19 F.3d at1112; Palumbo, 897 F.2d at 251; Hampton, 775 F.2d at 1485-86;United States v.Romano, 583 F.2d 1, 7 (1st Cir. 1978); United States v.McGee, 798 F. Supp. 53, 55 n. 3 (D.Mass. 1992); United States v.Serrano, 680 F. Supp. 58, 62 (D.P.R. 1988), aff'd, 870 F.2d 1(1st Cir. 1989).

If the government fails to prove that all of the evidencepresented to the grand juries that indicted Flemmi was untainted,the case against Flemmi must be dismissed unless the governmentproves that its error was harmless beyond a reasonable doubt.Poindexter, 951 F.2d at 377 ("unless the [Independent Counsel]proves on remand that the evidence received by the grand jury wasuntainted, or that any taint was harmless beyond a reasonabledoubt, the indictment must be dismissed."); Schmidgall II, 25F.3d at 1538 ("Dismissal of the indictment is not required whenuse of the immunized testimony was `harmless beyond a reasonabledoubt.'"); Gallo, 859 F.2d at 1082-84; Byrd, 765 F.2d at 1529n. 8.

Thus, at this point the burden on the government is "heavy."Kastigar, 406 U.S. at 461-62, 92 S.Ct. 1653; Palumbo, 897F.2d at 251. It is not, however, necessarily insurmountable.Compare e.g. Palumbo, 897 F.2d at 251 (ordering dismissal ofcase because government failed to satisfy its burden); Hampton,775 F.2d at 1490-91 (same) and Schmidgall II, 25 F.3d at 1539(affirming conviction because presentation of immunized evidenceto grand jury was "harmless beyond a reasonable doubt.").

In order to determine whether this case must be dismissedbecause of misuse of information that Flemmi provided after beinggiven enforceable assurances that included use and derivative useimmunity for the information that he provided to assist the FBIin its efforts to get warrants used to bug 98 Prince Street,Vanessa's, and 34 Guild Street, it will be necessary to "focus onthe evidence actually used by the government in obtaining theindictment[s]" of Flemmi. Schmidgall II, 25 F.3d at 1536. Thus,it is likely, but not certain, that the government will beordered to produce that evidence to the defendants.72Zielezinski, 740 F.2d at 734; Schmidgall II, 25 F.3d at1537-39 (analyzing evidence before grand jury); Hampton, 775F.2d at 1486-90 (same). See also United States v. Vest,842 F.2d 1319, 1333 (1st Cir. 1988) ("grand jury minutes are not partof the record on appeal, and thus [defendant] has presented nobasis on which [Court of Appeals] can even begin to considerwhether the district court erred" in deciding defendant was notprejudiced by presentation of illegally obtained tape-recordingto grand jury). Cf. Byrd, 765 F.2d at 1532 ("courts have infact considered in camera evidence when claims of Kastigarviolations are raised prior to trial").

If this case is not dismissed because of the presentation ofany tainted evidence to the grand juries that indicted Flemmi,such evidence will be excluded from use at trial. Thus, thehearing to be conducted will also serve to identify any suchevidence.

It may also be necessary for the court to determine whether thepresent prosecutors, who have now been exposed to the informationin Flemmi and Bulger's informant files, and thus may have beenexposed to tainted evidence, may participate in Flemmi's trial ifthis case is not dismissed against him. Byrd, 765 F.2d at 1532n. 11 ("In a Kastigar setting, we are of the firm opinion thatit would be unwise to permit an attorney familiar with theimmunized testimony to participate in the trial or preparation ofthe case"); Palumbo, 897 F.2d at 251 (quoting Byrd);Tormos-Vega, 656 F. Supp. at 1531-32 (case dismissed in partbecause prosecutor was exposed to immunized testimony). But seeUnited States v. Serrano, 870 F.2d 1, 18 (1st Cir. 1989) ("[W]ereject the notion thatthe mere exposure to immunized testimony or the mere possibilityof nonevidentiary use automatically results in the dismissal ofthe indictment.") As described in § II.33, supra, recognitionof the risk that exposure to Bulger and Flemmi's informant filesmight require their disqualification caused the prosecutorspresenting this case not to read them in connection with thegovernment's successful effort to obtain a protective orderconcerning discovery from the magistrate judge. However, thecourt may have to decide this issue if this case is not dismissedas against Flemmi.

(5) If Morris and Connolly Were Not Authorized to Promise Flemmi that the Evidence Intercepted at 98 Prince Street, Vanessa's, and 34 Guild Street Would Not Be Used Against Him, Flemmi's Statements to the FBI Relating to Those Interceptions May Have Been Involuntary and, In Addition, Use of Any Evidence Intercepted At Those Locations May Violate Flemmi's Right to Due Process

In the interest of completeness, it should be recognized thateven if Morris and Connolly were not authorized to promise Flemmithat the evidence intercepted at 98 Prince Street, Vanessa's, and34 Guild Street would not be used against him, their conduct mayhave violated his Fifth Amendment right not to incriminatehimself and his related right to Due Process. The parties havenot, however, addressed these questions. The court will affordthem the opportunity to do so before deciding their implicationsfor this case. To facilitate their work, the essence of theseissues is set forth below.

As indicated earlier, it has been held that there arecircumstances in which Due Process may require that thegovernment perform a promise made by an agent who exceeded hisactual authority. As the Court of Appeals for the First Circuithas noted: "courts on occasion have specifically enforcedpromises that would encroach on the jurisdiction of independententities. See, e.g., Palermo v. Warden, 545 F.2d 286, 296 (2dCir. 1976)." Bemis, 30 F.3d at 221 n. 1.

In Palermo, the Court of Appeals for the Second Circuitordered the release of a prisoner who had been denied parole bythe Parole Board because a prosecutor, who had exceeded hisauthority, promised in a plea agreement that Palermo would beparoled. 545 F.2d at 296. In doing so, the Court of Appeals forthe Second Circuit stated:

[F]undamental fairness and public confidence in government officials require that prosecutors be held to "meticulous standards of both promise and performance." Correale v. United States, 479 F.2d 944, 947 (1st Cir. 1973). Thus, the courts have afforded relief where prosecutors have made specific sentencing promises which were unfulfillable, since sentencing lies totally within the court's discretion, United States v. Hammerman, 528 F.2d 326 (4th Cir. 1975); Harris v. Superintendent, Va. State Penitentiary, 518 F.2d 1173 (4th Cir. 1975); Correale v. United States, supra, or where one federal prosecutor promised immunity from federal prosecution outside his own jurisdiction, United States v. Carter, 454 F.2d 426 (4th Cir. 1972) (en banc), cert. denied, 417 U.S. 933, 94 S.Ct. 2646, 41 L.Ed.2d 237 (1974). Geisser v. United States, 513 F.2d 862 (5th Cir. 1975) involved breach of a Department of Justice plea bargain which entailed, in part, a promise of parole after three years imprisonment. On appeal, the Department argued that the district court usurped the exclusive power of the Parole Board by ordering release. The Court of Appeals, although it remanded the case for a determination of what the Parole Board would do when informed of the bargain, concluded that such a bargain "fits well within the realm of enforceable constitutional rights. . . ." 513 F.2d at 869 n. 11. We agree and hold that where a defendant pleads guilty because he reasonably relies on promises by the prosecutors which are in fact unfulfillable, he has a right to have those promises fulfilled.

1. The FBI did at times utilize information provided by asource in an application for a warrant to conduct electronicsurveillance and also name that source as a purported target ofthat investigation in an effort to mask the identity of theinformant. In such cases, the FBI had no intention of using anyintercepted evidence against the source. This technique wasemployed with regard to Flemmi and Bulger in the application fora warrant to bug the storeroom at Vanessa's Restaurant. Toprotect the confidentiality of their status as sources, however,the FBI did not inform the Assistant Attorney General whoauthorized the application or the Assistant United StatesAttorney who filed it of the charade. Nor were these officialsadvised of the fact that Bulger and Flemmi had been told of theplanned bug at Vanessa's and, therefore, were not, as representedin the application, expected to be intercepted there. As aresult, an application concerning Vanessa's that the FBI knew wasfalse and misleading with regard to Flemmi and Bulger wassubmitted to the court. § II.20.

2. In early June 1989, Mercurio confirmed Flemmi's report thatRusso and his faction of the Patriarca Family were hoping tomurder Salemme before they were indicted, in part because theybelieved Salemme was planning to kill Ferrara. Connollyimproperly provided to Shelley Murphy of The Boston Heraldinformation on the imminent indictments and of Patriarca's"blessing" of Salemme's move to seize power in Boston. On June13, 1989, The Boston Herald published an article by Murphyheadlined, "Ex-con seen as Hub Mob's heir apparent," whichconsisted mainly of information that closely tracks the reportsConnolly prepared concerning the information that he had receivedfrom Flemmi and Mercurio. Three days later, on June 16, 1989,Salemme was shot and Patriarca Family Underboss William Grassowas murdered. § II.29.

In view of the potential for imminent violence that Flemmi andMercurio had described, it appears that the leak to The BostonHerald may have had the foreseeable effect, if not purpose, ofprovoking the attempt to murder Salemme. If Salemme had beenmurdered by the Russo faction of the Patriarca Family, the FBIwould have been spared the necessity of developing a prosecutablecase against him. In addition, Flemmi and Bulger would again havereceived one of the benefits of their bargain with the Bureau —an enhanced opportunity to profit from the vacuum created by thedecimation of the LCN in Boston. Id.

3. The files relating to the Wheeler murder, and the FBI'shandling of them, exemplify recurring irregularities with regardto the preparation, maintenance, and production in this case ofdocuments damaging to Flemmi and Bulger. First, there appears tobe a pattern of false statements placed in Flemmi's informantfile to divert attention from his possible crimes and/or FBImisconduct. §§ II.2, II.13.

Second, contrary to the FBI's usual policy and practice, allbut one of the reports containing Halloran's allegations againstBulger and Flemmi were not indexed and placed in an investigativefile referencing their names. Thus, those documents were notdiscoverable by a standard search of the FBI's indices. Similarirregularities in indexing and, therefore, access occurred withregard to information that the FBI received concerning anextortion by Bulger of Hobart Willis and from Joseph Murrayconcerning the murder of Brian Halloran, among other things. §§II.13, II.23, II.25.

Third, when documents damaging to the FBI were found by theBureau, they were in some instances not produced to thedefendants or the court at the time required by the court'sOrders. For example, some documents relating to Halloran'scharges against Bulger and Flemmi that should have been producedearlier were not disclosed until Rico, who was working for WorldJai Lai when Wheeler was murdered, and Morris had finishedtestifying. The FBI agent who had discovered the documents,however, had previously given the documents to the FBI's SpecialAgent in Charge ("SAC") in Boston, Barry Mawn, and the AssistantSpecial Agent in Charge ("ASAC"), Mike Wolf, because theinformation that they contained "was obviously highly singularand sensitive." § II.13. Similarly, there was delayed disclosureof documents relating to John McIntyre which impeded defendants'ability to question relevant witnesses. §§ II.14, II.22, II.23.

4. About a month after Halloran's murder, Morris solicited andreceived through Connolly $1000 from Bulger and Flemmi. Morrisused the money to buy an airplane ticket for his secretary, withwhom he was romantically involved, so she could visit him inGeorgia, where Morris was receiving advanced training. § II.13.

5. By the time Morris told Flemmi and Bulger of the Bahorianinvestigation he had taken an additional $6000 from Bulger andFlemmi and felt "completely compromised" and vulnerable. §§II.17, II.18, II.27. Morris feared that if Flemmi or Bulger wereprosecuted, the nature of his relationship with them would berevealed. Therefore, Morris decided to try to eliminate Bulgerand Flemmi as a threat to him. § II.27.

To accomplish this, Morris told Gerard O'Neill, a reporter forThe Boston Globe, that Bulger was an FBI informant. Morrisexpected that the newspaper would publish this fact, whileprotecting Morris as its source. Morris also calculated that sucha story would prompt the LCN to murder Bulger and probably provefatal to Flemmi as well. Id.

When the FBI learned of the proposed article, Daly, who hadbeen the lead agent in the race-fix case, called Kevin Cullen, areporter working with O'Neill. Daly falsely denied that Bulgerwas an informant and that he had been protected in the race-fixcase because he was an FBI source. Daly attempted to intimidateCullen and his colleagues from reporting that Bulger was aninformant by indicating that Bulger was a very dangerous person,who would not hesitate to kill anyone who wrote such a story.Daly noted that Cullen would be at particular risk because it waswell known that he, like Bulger, lived in South Boston. Id.

The Boston Globe took the threat seriously, but wasundeterred. On September 20, 1988, it published an articlereporting that Bulger had a special relationship with the FBI,which had provided him protection in many investigations. Perhapsunwittingly, James Ahearn, the SAC in Boston, denied that Bulgerwas being protected by the FBI. Id.

The FBI subsequently investigated whether Morris had leaked thefact that Bulger was an informant. Morris repeatedly lied underoath in that investigation. He remained with the Bureau until1995, when he retired as Chief of the Training and AdministrativeSection at the FBI Academy in Quantico, Virginia, following amenacing telephone call that he received from Bulger, who wasthen a fugitive. §§ II.27, II.33.

6. The protection Bulger and Flemmi received from their FBIhandlers was not unique. Like Flemmi and Bulger, Mercurio wasalerted to his imminent indictment and, as expected, became afugitive. § II.30. While he was a fugitive, Mercurio stayed incontact with Connolly. When Edward Quinn, the Supervisor of theOrganized Crime squad, learned on July 5, 1991 that Mercurio wasknown by the FBI to be in Boston, was expected to be on a boat onRowes Wharf on July 7, 1991, and was also understood by Salemmeto have assisted the FBI in bugging the LCN induction ceremony,Quinn secretly asked Connolly, who had retired, to get a warningto Mercurio of the dangers to him. Connolly did so. As a result,Mercurio promptly fled Boston again and was not at Rowes Wharfwhen FBI agents went to apprehend him on July 7, 1991. § II.31.

In the course of this case the court also received convincingevidence that another informant was told by his FBI handler (whowas not Rico, Connolly, Morris, or James Ring) aboutinvestigations concerning him, including wiretaps on histelephone. The court intends to provide this information to theAttorney General for whatever action, if any, she deemsappropriate.

In addition, the court notes that there are strikingsimilarities between the relationship Flemmi and Bulger had withtheir FBI handlers and the relationship that Top Echeloninformant Gregory Scarpa, Sr. had with his FBI handler,Supervisory Special Agent R. Lindley Delvecchio, which isdepicted in Orena v. United States, 956 F. Supp. 1071, 1085-90,1101-04 (E.D.N.Y. 1997). In Orena, it was found to be "likely"that "Delvecchio . . . `paid' Scarpa by passing alonginformation, creating a two-way street for communications thatwas dangerous and unauthorized." Id. at 1087, 1090. Forexample, the evidence indicated that Delvecchio protected Scarpaby alerting him to investigations, advising him of electronicsurveillance, identifying individuals cooperating with lawenforcement, and warning him of imminent arrests. Id. at 1071,1085-90, 1101-04.

7. The government did not produce at the time required by thiscourt's Orders the documents developed in an Internal RevenueService ("IRS") investigation relating to Slinger. When they werebelatedly furnished for the court's in camera inspection, thegovernment argued that the defendants should not be provided theinformation indicating that Slinger had told the FBI that he wasbeing extorted by Bulger, but the FBI conducted no investigation,in part because no FBI report of his interview had been locatedand, despite an assiduous effort, the FBI could find no agent whohad interviewed Slinger. Thus, the government suggested thatSlinger had not told authentic FBI agents about being extorted byBulger. When the court ordered disclosure to the defendants ofthe Slinger matter, the government argued, for the same reasons,that the court should not permit evidence to be introducedconcerning it. § II.22.

However, at defendants' request, the court asked John Newton,who had served on the squad which would have had responsibilityfor investigating the Slinger matter, and who was waiting toresume his testimony, if he was familiar with Slinger. Newtonpromptly acknowledged that he had participated in the interviewof Slinger and understood that despite Slinger's willingness tocooperate, Newton's superiors had decided that no furtherinvestigation would be conducted because Bulger was a valuableFBI informant. Id.

8. It should also be recognized that agents of the FBI inBoston were not uniform in their conduct concerning Bulger andFlemmi. James Knotts earnestly sought information to support theeffort of the Massachusetts State Police to bug the LancasterStreet Garage. § II.11. Leo Brunnick, Gerald Montanari, andBrendan Clearly genuinely attempted to investigate whether Flemmiand Bulger were responsible for the murders of Wheeler, Halloran,and Callahan. § II.13. SAC James Greenleaf sincerely attempted toinsulate Connolly from knowledge of the DEA-FBI jointinvestigation of Flemmi and Bulger. § II.17. Robert Jordan andStanley Moody truly targeted Flemmi as part of the Bahorianinvestigation. § II.26.

9. Francis Salemme, Jr. and George Kaufman have each diedsince being indicted.

10. The court also informed the parties of its tentativedecision to exclude the testimony of Hugh Shields and otherevidence concerning the 1967 murders of Edward, Walter, WilliamBennett, and Richard Grasso. These murders were charged for thefirst time in the Third Superceding Indictment as RacketeeringActs of Flemmi and Salemme. The court tentatively concluded thatthe government had impermissibly used the grand jury primarily orexclusively to obtain evidence to strengthen the RICO chargespreviously alleged by obtaining an immunity order, pursuant to18 U.S.C. § 6001 et seq., to compel the otherwise unavailabletestimony of two witnesses who were essential to charging themurders as Racketeering Acts and to strengthening the evidence ofthe alleged enterprise. § II.33.

Although this decision is subject to possible change pendingthe preparation and issuance of a written memorandum and order,it may have significant practical consequences. If Flemmi and/orSalemme are convicted in this case, but not held responsible forany of the four murders, the Guideline ranges for their sentencesmay be reduced from life in prison to 10 to 13 years for Flemmiand eight to 10 years for Salemme. Id.

11. After the May 22, 1997 Memorandum and Order was issued,but before it was made public, the FBI announced for the firsttime that it was offering a $250,000 reward for Bulger's capture.§ II.33. However, the evidence in this case raises questionsconcerning whether the FBI has consistently made its best effortsto apprehend Bulger.

In 1995, after Bulger fled, Charles Gianturco was put in chargeof the Bulger fugitive investigation. Id. In 1978, Bulger hadwarned Connolly of the planned, imminent murder of CharlesGianturco's brother, Nick, who was then operating as an FBIundercover agent. Bulger was later credited with saving NickGianturco's life. Nick Gianturco dined with Bulger and Flemmi onseveral occasions, and was among the FBI agents who exchangedgifts with them. § II.7.

Bulger had returned to the Boston area in late January 1995 todrop off his companion Theresa Stanley. Although it was widelyknown that she had been traveling with Bulger and was back inBoston, the FBI did not contact her until April 1996, fifteenmonths after her return. When finally interviewed, Stanleyprovided considerable information concerning her travels withBugler, but that information was dated and of diminished value. §II.33.

Connolly was not interviewed in the Bulger fugitiveinvestigation until March 21, 1997, more than two years afterBulger fled. Connolly made several statements that should havebeen included in the report of that interview. Connolly reportedthat Morris had told Bulger and Flemmi "that they were so good,he could get them off for anything short of murder." Connollyalso said that he hoped that "Bulger was never caught." CharlesGianturco did not, however, record these statements in his reportof Connolly's interview. Id.

Several weeks before the issuance of this Memorandum and Order,in August 1999, the FBI for the first time placed Bulger on itslist of Ten Most Wanted fugitives.

12. As indicated earlier, however, the FBI also failed toproduce certain damaging documents in a timely manner, includingdocuments concerning Halloran's statements implicating Bulger andFlemmi in the Wheeler murder, documents relating to McIntyre'sallegations regarding Bulger and Flemmi, and documents relatingto Slinger. §§ II.13, II.14, II.22.

13. The cases in which informal promises of immunity made byagents without the involvement of any prosecutor have been heldto be unenforceable are distinguishable from the instant case indecisive respects. They each involved individuals who were underactive investigation or arrest and asked to cooperate in adiscrete matter, rather than persons, like Flemmi, approached andcultivated to serve as long term informants. In addition, inthose cases relief was denied in part because the government didnot use the defendants' statements against him, directly orindirectly. Thus, in contrast to Flemmi, it was found that thedefendant had not relied to his detriment on the law enforcementagent's promise. § III.1.D(3).

14. If, contrary to this court's conclusion, the FBIgenerally, and Morris and Connolly particularly, lacked theauthority to promise Flemmi the immunity at issue here, it wouldbe necessary for the court to decide whether their improperpromises of immunity induced Flemmi to involuntarily makestatements that the government proposes to use to achieve hisconviction. If such statements were involuntary, neither they norany evidence derived from them would be admissible at trialagainst Flemmi. However, Flemmi would not be entitled to anyremedy for the misuse of such statements before the grand jury. §III.1.D(5).

15. Because Flemmi was neither intercepted at Vanessa's norhad a possessory interest in the premises, he is not an"aggrieved person" with standing to litigate a claim that theelectronic surveillance conducted at Vanessa's violated TitleIII.

16. The three incidents involved Eddie Miani, Buckey Barrett,and an innocent individual who was erroneously suspected ofkidnapping 11-year-old Sara Pryor. § II.4

17. 18 U.S.C. § 2516(1) requires that the Attorney General orcertain other high ranking officials of the Department ofJustice, including the Assistant Attorney General in charge ofthe Criminal Division, authorize an application to the court fora warrant to conduct electronic surveillance. This provision issolely statutory in origin and is central to the electronicsurveillance statute. The Supreme Court has held that § 2516(1)requires the "informed judgment" of a high ranking officialbefore an application is filed in order to be "doubly sure" thatelectronic surveillance is employed with restraint. UnitedStates v. Giordano, 416 U.S. 505, 515, 94 S.Ct. 1820, 40 L.Ed.2d341 (1974); § III.2.B.

Flemmi correctly contends that the Assistant Attorney Generalwas deprived of the information necessary to perform hisstatutory function properly and, as a result, an applicationwhich would not have been authorized if the Assistant AttorneyGeneral had been fully informed was submitted to the court.Existing jurisprudence, however, suggests that there is not ajudicial remedy for such a subversion of Title III. Instead, ithas been held that the prospect of political accountability,evidently including Congressional oversight, is expected toprovide sufficient deterrence and potential structural remediesif § 2516(1) does not operate as intended. While the reasoning ofsuch decisions is questionable in the circumstances of this case,the court has not relied upon § 2516(1) in finding Flemmi'smotion to suppress to be meritorious. § III.2.B.

18. Alpheus Thomas Mason, Harlan Fiske Stone: Pillar of theLaw 153 (1956) (quoting N.Y. Times, May 10, 1924); § II.6.

19. John T. Elliff, The Reform of FBI IntelligenceOperations 5-6 (1979) (quoting Report of Senate SelectCommittee to Study Governmental Operations with respect toIntelligence Activities); § II.6.

20. Id.

21. Roviaro, 353 U.S. at 60-61, 77 S.Ct. 623.

22. United States v. Salemme, 978 F. Supp. 343, 349-52,356-58 (D.Mass. 1997).

23. The record from which the facts described in detail inthis Memorandum have been found includes many documents and thetestimony of many witnesses. It should be recognized, however,there were several potentially important witnesses who wereunavailable. Bulger is a fugitive. As the parties agreed, becauseof his medical condition, O'Sullivan was unable to testify.Connolly asserted his Fifth Amendment right not to testify, thegovernment declined to compel his testimony by granting himimmunity, and the court found there was not a proper basis for itto order the government to do so. § II.33.

In addition, no party called John Martorano to testify.However, within the past week, on September 9, 1999, thegovernment filed a plea agreement with John Martorano whichprovides for his cooperation in future proceedings. In view ofthe decisions concerning Flemmi's claims of immunity described inthis Memorandum, it is inevitable that if this case is notdismissed Flemmi will assert that Martorano should not bepermitted to testify against him because Martorano's cooperationwas obtained as a result of the government's breach of itsagreement to maintain the secrecy of Flemmi's service as an FBIinformant and because the government's questioning of Martoranowas impermissibly influenced by information that Flemmi providedto the FBI pursuant to certain enforceable promises of immunity.§§ III.1.D(2)-(4). The court will decide the challenging questionof whether Martorano should be permitted to testify againstFlemmi if and when it becomes necessary to do so.

24. Robert H. Jackson, "The Federal Prosecutor," 24 J. Am.Judicature Soc'y 18, 20 (June 1940).

25. United States v. Rabinowitz, 339 U.S. 56, 69, 70 S.Ct.430, 94 L.Ed. 653 (1950) (Frankfurter, J., dissenting).

26. Louis D. Brandeis, Interlocking Directorates, in LVIIAnnals of American Academy of Political and Social Science 45,45 (Clyde L. King ed., 1915).

27. Citations to the record are included for virtually all ofthe facts found. However, since this matter has required makingmany credibility determinations and drawing reasonable inferencesfrom a great volume of evidence, it is not feasible to cite allof the evidence which the court has considered and assessed. Thecitations to the record that are included are intended to behelpful, but do not describe completely the evidence on which thecourt has relied in drawing inferences and finding facts.

28. As the parties have been informed orally, the court hastentatively decided to grant the motions to dismiss RacketeeringActs 21-24, which relate to the alleged murders of Wimpy Bennett,his two brothers, and Richard Grasso, that were first alleged inthe Third Superceding Indictment, because the governmentimproperly used the grand jury to strengthen the previouslyalleged RICO charges against Flemmi and Salemme. See, e.g.,United States v. Beasley, 550 F.2d 261, 266 (5th Cir. 1977);United States v. Gibbons, 607 F.2d 1320, 1328 (10th Cir. 1979);In re Santiago, 533 F.2d 727, 730 (1st Cir. 1976).

29. In 1967, murder was not a federal offense. The federal lawprohibiting murder in aid of racketeering activity,18 U.S.C. § 1959, was not enacted until 1984. The federal RICO statute,18 U.S.C. § 1961 et seq., under which murder may be prosecuted asa racketeering act, was enacted in 1970.

30. The government does not dispute the court's finding thatRico told Flemmi of the forthcoming indictments so that he couldflee. Apr. 14, 1999 Tr. at 164-66.

31. Morris and Connolly told Buckey Barrett, in an effort tointimidate him, that Bulger and Flemmi would be seeking from hima share of the proceeds of the Medford Depositors Trust robbery,but that the FBI would protect him if he cooperated in itsinvestigation of that crime. Morris Apr. 21, 1998 Tr. at 97-98,Apr. 29, 1998 Tr. at 110, Apr. 30, 1998 Tr. at 98-101.

In the late 1980's, an 11-year old girl, Sara Pryor, waskidnapped. A recently arrested individual from South Boston wassuspected to be the kidnapper. Morris Apr. 30, 1998 Tr. at203-10. Morris, Connolly, and another agent, brought Bulger, whowas then an informant, to the jail and suggested to the suspectthat Bulger would deal with him if he did not confess. Id. Thesuspect, who was later recognized by the FBI to be innocent, didnot confess. Id.

32. The Federal Rules of Evidence are not applicable inhearings on motions to suppress. See Fed.R.Evid. 1101(d)(1).Nor do they apply with regard to the preliminary factfindingnecessary to decide a motion to dismiss under Fed.R.Crim.P.12(e). See Jan. 14, 1998 Tr. at 7-9 (citing 1A Charles A.Wright, Federal Practice & Procedure, Criminal 2d § 194, at715-16; Salzburg, Federal Rules of Evidence Manual (6th ed.),Vol. III at 1793). Nevertheless, the court generally applied theFederal Rules of Evidence in deciding whether proferredinformation was sufficiently reliable to be considered in thepending proceedings.

As discussed in § II.33, infra, after denying Flemmi's motionto compel the government to grant Connolly immunity in order toobtain his testimony, the court admitted parts of several ofConnolly's public statements, pursuant to Fed.R.Evid. 804(b)(3),as statements against interest by an unavailable declarant. SeeOct. 23, 1998 Tr. at 34-47.

33. The court notes that Sarhatt did not furnish a copy of hismemorandum to O'Sullivan. See Ex. 3. This, among other things,suggests that the memorandum was written in meaningful measurefor the protection of the FBI and raises questions concerningwhether O'Sullivan would dispute Sarhatt's characterization ofhis comments. Exhibit 3 may be an example of what has beencharacterized as "Bureau-speak." It has been written that:

The Bureau employs two separate languages. The first, for internal and interdepartmental communications, may be called Bureau-speak. It is cryptic, telegraphic and routine and its purpose is less to communicate than to anticipate, to make a record for future protection. "You can have a conversation with an agent," says Edwin O. Guthman, [Attorney General] Kennedy's press secretary, "and when it is over he will send a memo to the files. Any relation between the memo and what was said in the conversation may be purely coincidental. You would think you were at different meetings."

Navasky, supra, at 16. While the court wonders whetherO'Sullivan's comments were as strong and unequivocal as describedby Sarhatt, it does find that Sarhatt consulted O'Sullivan andO'Sullivan supported the continuation of Bulger as an informant.

34. The issue of the representations made to Bulger and Flemmiconcerning the use of the 98 Prince Street tapes was raised forthe first time in Flemmi's testimony, rather than in hisaffidavits, which did not purport to be exhaustive. See, e.g.,Ex. 30, ¶ 4. The government recalled Ring to refute many ofFlemmi's claims. The government did not recall Morris to addressthe 98 Prince Street immunity issue.

35. Flemmi's counsel stated that he and his client were"certainly not" arguing that the FBI leaked information aboutMcIntyre's cooperation and that Bulger and Flemmi wereresponsible for his murder. June 22, 1998 Tr. at 117. Rather, thedefendants contend that the information McIntyre provided and hisdisappearance involved matters within the FBI's investigativejurisdiction, which were not pursued as part of the FBI'sperformance of its promise to protect Bulger and Flemmi fromprosecution. June 2, 1998 Tr. at 133-34.

36. In 1988, SAC James Ahearn asked Morris if he everrecommended that Bulger and Flemmi be closed as informantsbecause they had "outlived their usefulness." Morris Apr. 30,1998 Tr. at 89-90, 111-12. Morris now admits that he lied when hedenied he had done so. Id., Morris Apr. 28, 1998 Tr. at 82.

37. The Non-Traditional Organized Crime squad did not initiateany investigations of Bulger and Flemmi. As described in § II.26,infra, the Non-Traditional Organized Crime squad did continuean investigation targeting Flemmi, among others, that was begunby agents who were under Ring's supervision and who were latertransferred. That investigation of Flemmi, however, wasfrustrated when Morris, who was then the supervisor of theNon-Traditional Organized Crime squad, and Connolly tipped Flemmioff concerning it.

38. The Boeri Affidavit previously stated that theinvestigation had initially been conducted jointly by the DEA,the Quincy Police Department and the Massachusetts State Police.Ex. 133 at 22. It did not explain that the State Police had beendropped from the investigation. Id.

39. There is also a reference to an informant in Floridastating that the "Howie Winter organization" and Baione werereceiving marijuana and cocaine from Florida by truck. Ex. 133 at43 (¶ 66).

40. In its Post-Hearing Brief, at 349, the government editedthe quotations ascribed to CS-4 to obscure the fact that theinformant expressly linked Kaufman only to Title 18 offenses,none of which related to narcotics activity.

41. The fact that he was providing such information could havebeen an element of his defense if Connolly were ever accused ofundermining the DEA's investigation.

42. The request that Flemmi be reopened as an informant alsoexplained that he had been closed on September 23, 1982 becauseof purported, pending investigations arising from theinterceptions at 98 Prince Street and 51 North Margin Street.Exs. 83, 110. As described in § II.11, supra, Flemmi had notbeen targeted for investigation relating to that electronicsurveillance. Morris Apr. 23, 1998 Tr. at 20; Ring June 10, 1998Tr. at 40. Rather, when closed as an informant in September 1982,Flemmi was a subject in the investigation of the Wheeler,Halloran, and Callahan murders.

43. This conclusion is reinforced by the statement in Carter'saffidavit that the informants relied on in the affidavit:

[H]ave provided information in other investigations. Some of this information resulted in the identification and conviction of a number of criminals. Use of informant testimony, even if compelled by a grant of immunity, would seriously jeopardize if not totally destroy their continued usefulness in other investigations.

Ex. 153, Carter Aff., at 28.

44. The court also ordered disclosure to defendants of a 1991302 stating that a witness had reported that, in 1991, JohnConnolly was telling certain individuals to be cautious indealing with Slinger. May 28, 1998 Tr. at 13 (Under Seal). Thewitness also reported that Bulger and Flemmi had made contingencyplans to escape if indicted and "would know in advance of theirindictment, and would run." Id. at 13-14. Neither thegovernment nor the defendants, however, called that witness totestify.

45. Blackburn initially claimed that he had not seen the 209swhich are Exhibits. Blackburn May 7, 1998 Tr. at 62-63. It waslater disclosed he had prepared those 209s. Id.

46. Although Daly continues to serve as an FBI agent inBoston, the government decided not to call him as a witnessfollowing Cullen's testimony. Cullen Oct. 15, 1998 Tr. at 184.

47. Morris had also leaked to The Boston Globe the fact thatthe FBI and United States Attorney's Office had reopened a publiccorruption investigation of William Bulger relating to a buildingknown as 75 State Street. Morris Apr. 27, 1998 Tr. at 163, Apr.28, 1998 Tr. at 31-34. In an interview and two sworn statements,Morris lied in denying this leak as well. Morris Apr. 27, 1998Tr. at 163, Apr. 28, 1998 Tr. at 64-73; Exs. 84, 85. Ironically,Morris had previously improperly assisted William Bulgerconcerning the 75 State Street investigation by telling Connollyto advise the Senate President to submit to an interview becausethe case against him was not very strong and an interview wouldput an end to the matter. Morris Apr. 28, 1998 Tr. at 34-35.

48. After the court reviewed the Mercurio informant file incamera, some, but not all, of the inserts that it included wereproduced to the defendants. The two cited inserts may not havebeen produced. In any event, they were not admitted as exhibits.While not essential to the court's analysis, reference to theinformation concerning the advice that the putative defendantswere receiving from Cardinale which Mercurio gave the FBIprovides context for understanding Ring's concern aboutMercurio's potential dual status as an informant and defendant.

49. The court initially sustained the government's objectionto admission of the article on the grounds of relevance andmarked it Ex. TTT for identification only. June 19, 1998 Tr. at201-03. In the course of writing this decision, the court hasdiscerned the relevance of the document, not for the truth of thematters reported, but as context for understanding evidence thatwas admitted concerning Flemmi's motion to dismiss. Thus, thisMemorandum refers to the text of the article, as well as to thetestimony concerning it.

50. As described in the Conclusions of Law, § III.4, infra,because the court has found that DeLuca lacks standing tochallenge the admissibility of the evidence intercepted at 34Guild Street, the court is not now addressing the merits of theissues presented by his motion to suppress, including whether, ifapplicable, Franks requires suppression. Thus, the court has,among other things, not now made some of the factual findingsrequired by Franks. If, however, the court's conclusionconcerning DeLuca's lack of standing is reviewed and reversed onappeal, the court will on remand make the legally requiredfindings, which with regard to at least the first prong of theFranks test may depend in meaningful measure on assessments ofcredibility.

51. As defendants were advised on August 14, 1998, at therequest of the government and pursuant to the procedure suggestedin United States v. Higgins, 995 F.2d 1, 3 (1st Cir. 1993), thecourt questioned ex parte the informant described as CS-3 inthe Steffens affidavit and certain FBI agents to determinewhether the defendants' request that CS-3 be identified andrequired to testify was meritorious. Aug. 14, 1998 Tr. at 2-4(Under Seal). Based on that inquiry, the court found thatdisclosure of the informant's identity was not justified underthe standards established by Roviaro, 353 U.S. 53, 77 S.Ct.623, 1 L.Ed.2d 639 and its progeny. Id. More specifically, thecourt found that CS-3 did not know the location at which theOctober 29, 1989 induction ceremony would be held. Id. at 3.Although he was never asked if he would testify, if asked, CS-3would have refused to do so, even if presented with an immunityand compulsion order issued pursuant to 18 U.S.C. § 6001 et seq.Id. In addition, assuming, without finding, that CS-3 could haveattended the ceremony, he would have refused to utilize a deviceto record it. Id.

52. In 1998, § 2518(11)(b)(ii) was amended to delete therequirement of "a showing of a purpose . . . to thwartinterception" and to replace that standard with the requirement"that there is probable cause to believe that the person'sactions could have the effect of thwarting interception from aspecified facility. . . ." Pub.L. No. 105-272, Title VI, § 604,112 Stat. 2413. Section 2518(11)(a)(ii) concerning roving bugswas not amended in 1998.

53. With regard to Vanessa's, Weld testified that if he hadbeen fully informed and somehow persuaded to submit anapplication characterizing Bulger and Flemmi as targets, whenthey were really sources who were not expected to be overheard orinvestigated, he would "at a minimum . . . have sought . . . anoff balance sheet proceeding with the judge." Weld May 27, 1998Tr. at 113. This is an approach that has been judicially endorsedboth before and after 1986. United States v. Strini,658 F.2d 593, 595 n. 2 (8th Cir. 1981); United States v. Falls,34 F.3d 674, 682 (8th Cir. 1994).

54. The affidavit also did not indicate that the FBI had acooperating witness who was meeting with several prime suspectsin the Salemme shooting, and was willing to record conversationswith them and to testify. Ex. 189; Steffens Aug. 6, 1998 Tr. at116-17. The limited evidence presented does not indicate that thecooperating witness was meeting with Russo, Ferrara, andCarrozza. Id.

55. Exhibit 195 should have been maintained in the files ofthe FBI's Boston office and produced prior to August 1998. It wasnot produced, however, until August 1998, after Assistant UnitedStates Attorney Herbert found a copy at FBI Headquarters andfurnished it to the defendants. Aug. 10, 1998 Tr. at 10. Thus,the document was not available when Ring testified over many daysin June 1998.

56. Prior to Mercurio's testimony on August 4, 1998, in thecourse of ex parte proceedings not involving the defendants,the court discerned that an FBI informant had in July 1991 beencredited with saving Mercurio's life by providing informationthat kept Mercurio from being on a boat as previously planned.Aug. 17, 1998 Tr. at 1-5 (Under Seal). In response to a questionfrom the court, Mercurio testified that he was in New York inJuly 1991. Mercurio Aug. 5, 1998 Tr. at 128-29. The courtsubsequently questioned Quinn in camera. Aug. 11, 1998 Tr.(Under Seal). The court later told the defendants of theinformation that it had received ex parte, without identifyingthe source. Aug. 17, 1998 Tr. at 1-5 (Under Seal). Carter andQuinn publicly testified about the boat matter on August 17, 18,and 19, 1998. On September 16, 1998, Mercurio appeared again andtestified that he had been in Massachusetts, rather than NewYork, on July 4, 1991, and, indeed, had at that time been inMassachusetts for several months. Mercurio Sept. 16, 1998 Tr. at77-78, 87.

57. Hobbs prepared the 302, which is Ex. 256, on July 11,1991. Ex. 256. A copy was sent to Carter. Id.; Hobbs Aug. 11,1998 Tr. at 48-49, 84. The 302 should have been maintained in theMercurio fugitive file. Id. at 91; Carter Aug. 17, 1998 Tr. at122; Quinn Aug. 19, 1998 Tr. at 62. It was not. Carter Aug. 17,1998 Tr. at 122.

58. Quinn testified that he recalled that he was told that itwas Manacchio who believed that Mercurio was an FBI informant.Quinn Aug. 19, 1998 Tr. at 50. The source who prompted theconversation with Quinn had reported that Salemme had determinedthat Mercurio was an informant. The court infers that Quinn wasaccurately informed of this fact.

59. In the period of April through August 1991, DEA agents andother law enforcement officials told Hobbs that they believedMercurio was an FBI informant. Hobbs Aug. 11, 1998 Tr. at 87-92.Hobbs attempted to determine if this was true by asking NickGianturco, who was the head of the Informant Coordinating Unit.Id. at 91-92. Gianturco would not confirm that Mercurio was aninformant. Id.

60. This Memorandum includes some information contained in theOctober 31, 1997 letter to the court which was not disclosedpreviously to the defendants because it is relevant toforeseeable issues concerning whether this case should bedismissed for grand jury abuse.

61. Exhibit 271 was disclosed to defendants and admitted afterthe court overruled the government's claim that it was protectedby the deliberative process privilege and as work-product. Dec.14, 1998 Tr. at 4-17. For the purposes of this decision, however,the court has not considered the opinion which Callahanexpressed, in Exhibit 271, that Flemmi had been "at least tacitlyauthorized" to engage in illegal activity, including gambling andLCN policymaking, for the truth of whether Flemmi was indeedauthorized, but primarily for the purpose of placing in contextwhat occurred subsequently.

62. The government withdrew the October 22, 1995 filings andreplaced them with revised versions on November 15, 1995. SeeJune 23, 1997 Order (Under Seal). This court has ordered thegovernment to produce the original October 22, 1995 submissions,but has not received them.

63. The defendants also moved to suppress the electronicsurveillance conducted on December 11, 1991, by the FBI, at theHilton Hotel in East Boston, Massachusetts. Salemme, 978F. Supp. at 346-47. In connection with this motion, the defendantssought an order compelling the government to disclose whetherAnthony St. Laurent and/or Kenneth Guarino were FBI informants.Id. The court granted the motion for an evidentiary hearingconcerning the Hilton Hotel intercepts. Id. at 346-47, 358-61,363. The court also initially ordered the government to disclosewhether St. Laurent and/or Guarino were informants. Id.

The government subsequently moved for reconsideration of thecourt's decision regarding St. Laurent and Guarino. The courtagreed to decide that request and address the motion to suppressconcerning the Hilton Hotel intercepts separately from the issuesconcerning the 1984-85 and 34 Guild Street interceptions. UnitedStates v. Salemme, 978 F. Supp. 379, 380 n. 1 (D.Mass. June 19,1997). Thus, this Memorandum contains no further reference to theHilton Hotel motion and related matters, except to note that theywill have to be decided before Flemmi's motion to dismiss isresolved.

64. Flemmi also stated to the court: "Your honor, you'regetting to the core of the matter. There's no doubt about that.You're right there. If you go a little further, you could get thewhole complete story." Apr. 16, 1997 Tr. at 122 (Under Seal).

65. These other matters included a criminal contempt trial atwhich Cardinale was found not guilty of violating the protectiveorder issued concerning the documents produced to defendants indiscovery. See Oct. 29, 1997 Tr. at 14. In addition, the courtconducted hearings before allowing defendants' motion to havetheir counsel appointed to continue to represent them at publicexpense, under the Criminal Justice Act, because the defendantsno longer had the resources to retain them privately. See Nov.14, 1997 and Dec. 29, 1997 Memoranda and Orders.

66. The government does not contend that any immunityagreement that Flemmi had is not enforceable because it was notin writing and therefore is unenforceable under the statute offrauds, M.G.L. ch. 259, § 1, which requires that "an agreementnot to be performed within one year" be memorialized in a writingand signed by, or on behalf of, the party to be charged. Any suchcontention would be unmeritorious for two reasons.

First, Flemmi claims, in effect, that he was promised that ifhe served the FBI as an informant he would not be prosecuted forcrimes that he might commit. Flemmi's agreement to assist thegovernment was of indefinite duration. It could have beenperformed in less than a year. Thus, even if the statute offrauds were deemed applicable, it would not require that Flemmi'sagreement with the government be in writing. See, e.g., Boothbyv. Texon, Inc., 414 Mass. 468, 479, 608 N.E.2d 1028 (1993) ("TheStatute of Frauds `applies only to contracts which by their termscannot be performed within the year. It does not apply tocontracts which may be performed within, although they may alsoextend beyond, that period.'"); Dunne v. Fall River,328 Mass. 332, 334, 104 N.E.2d 157 (1952); Meng v. Trustees of BostonUniv., 44 Mass. App. Ct. 650, 652, 693 N.E.2d 183 (1998); CarolineN. Brown, 4 Corbin on Contracts § 19.3 (Joseph M. Perillo, ed.,Rev.ed. 1997); E. Allen Farnsworth, Contracts § 6.4 (1990);Restatement (Second) of Contracts § 130, cmt. a. (1979).

More significantly, as stated previously, with regard toimmunity agreements Due Process requires that generallyapplicable principles of contract law be modified if necessary toassure fundamental fairness. It is reasonable and consistent withusual practice to require that certain commercial contracts beembodied in signed, written documents. However, the government'sagreements with its informants are highly confidential and arenot ordinarily written. A requirement that such agreements be inwriting could discourage many potential sources from cooperatingwith the government. In the circumstances, depriving Flemmi ofthe benefit of any bargain he may have with the governmentbecause of the lack of a written agreement would be fundamentallyunfair.

67. Implied actual authority is different than apparentauthority, which focuses on actions that create a reasonablebelief in a third person that the putative agent has theauthority to act for the principal. See Hinchey v. NYNEX Corp.,144 F.3d 134, 141 (1st Cir. 1998).

68. Morris testified that he did not believe that he had thepower to confer immunity. Morris Apr. 29, 1998 Tr. at 48-50. Thecourt finds that this testimony is not credible.

69. Moreover, as the FBI received the valuable benefits of itsbargain, a breach of the purported, but unproven, obligation ofFlemmi to provide the FBI the details of his own criminalactivity would be immaterial and, therefore, not provide a groundfor rescinding the agreement at this time. United States v.Castaneda, 162 F.3d 832, 837-39 (5th Cir. 1998).

70. In addition to the open issue concerning the motivationfor the payment there is a question whether the tip concerningHalloran's cooperation constituted an "official act," which mustbe implicated to trigger the applicability of § 201(c)(1)(A).See United States v. Singleton, 165 F.3d 1297, 1302 n. 2 (10thCir. 1999), cert. denied, ___ U.S. ___, 119 S.Ct. 2371, 144L.Ed.2d 775 (1999) ("It is inconceivable that any court wouldhold that a prosecutor who pays for the false testimony of awitness is carrying out an official function of the government"as required by § 201).

71. In United States v. Rivieccio, 919 F.2d 812, 816 (2dCir. 1990), the court in effect applied the Calandra standardin a case involving the presentation of immunized evidence to thegrand jury. This approach was inconsistent with the Court ofAppeals for the Second Circuit's then recent decision inPelletier, which held that "[i]f the government used the[defendants'] immunized testimony to secure indictment . . . thedistrict court should dismiss the indictment, unless theimmunized testimony presented was so minimal or of suchinconsequential nature in light of the other evidence before thegrand jury as to constitute harmless error." Pelletier, 898F.2d at 303. More recently, the Court of Appeals for the SecondCircuit has stated:

[I]f the government has presented immunized evidence to the grand jury, the indictment should be dismissed unless the government establishes that the grand jury would have indicted even absent that testimony. See, e.g., Rivieccio, 919 F.2d at 816 n. 4; Pelletier, 898 F.2d at 303.

United States v. Nanni, 59 F.3d 1425, 1433 (2d Cir. 1995).Thus, it appears that the relevant law in the Second Circuit isnow generally consistent with the standard this court understandsto be correct. However, to the extent that Rivieccio suggests adifferent standard, this court respectfully disagrees.

72. The court previously denied, with limited exceptions, thedefendants' motion for production of the evidence presented at tothe grand jury. See United States v. Salemme, 1997 WL 810057 at*5 (D.Mass. Dec.29, 1997).

73. Flemmi may also contend that all of his statements to theFBI were involuntary based upon the explicit promises of"protection" that he received from Rico, Connolly, and Morris andthe FBI's conduct over three decades. The principles discussed inthis Memorandum concerning 98 Prince Street, Vanessa's, and 34Guild Street would also be generally applicable in analyzing anybroader claim for suppression based on involuntariness.

74. It is actually the interaction of §§ 2516(1) and2518(1)(a) that together require that a specified, politicallyaccountable official authorize an application for electronicsurveillance. The court, however, refers only to § 2516(1) as asort of simple shorthand.

75. The government has intended to use in its case-in-chiefonly the interceptions obtained from the wiretap of Kaufman'stelephone, rather than the interceptions from Bulger's automobileand apartment. Gov. Post-Hearing Brief at 316-17.

76. In addition, if on any appeal it should be decided that,contrary to this court's conclusion, § III.4, infra, theinterceptions at 34 Guild Street did involve "oralcommunications" as defined by 18 U.S.C. § 2510(2) and, therefore,DeLuca is, within the meaning of § 2510(11), an "aggrievedperson" who has standing to maintain a motion to suppress, thestandard to be applied might make a difference to the ruling onthat motion.

77. Although the defendants do not agree that Congress and thePresident intended that the judicially crafted exclusionary ruleever be applied in any Title III case, they argue that JudgeCarr's commentary indicates that the statutory exclusionary rulewas applicable prior to the 1986 amendments and, therefore,should be employed to resolve the motion to suppress the 1984-85electronic surveillance. Defs.' Mem. in Supp. of Mot. to Suppressat 60, 62. The government contends that even if the judiciallyfashioned exclusionary rule were not incorporated in Title IIIfor certain cases prior to 1986, the 1986 amendment should beapplied retroactively and utilized to decide the motion tosuppress the 1984-85 electronic surveillance. Government'sSubmission Pursuant to Court's March 28[sic], 1999 Order andOpposition to Defendant Flemmi's Motion to Suppress the Fruits ofElectronic Surveillance at Vanessa's Restaurant (April 6, 1999)at 35-37. Because the motion to suppress is meritorious underboth the Franks and Giordano standards, it is not necessaryto decide the question of retroactivity if the constitutionallycrafted exclusionary rule was in 1986, as Judge Carr indicates,for the first time made applicable to violations of Title IIIwhich also violate the constitution.

78. The Deputy Attorney General also noted, however, that"several judicial circuits have already extended the good faithexception to certain situations under Title III. The proposedamendment would make such a good faith exemption applicable toall Title III cases." Id.

79. Contrary to defendants' contention, the discussion infootnote 16 of Katz, 389 U.S. at 355 n. 16, 88 S.Ct. 507, isnot inconsistent with this court's interpretation of Berger asrequiring a showing of necessity as a form of exigentcircumstances as a component of a constitutionally sufficientsubstitute for pre-search notice. Katz cites Ker, 374 U.S. at37-41, 83 S.Ct. 1623, an early case in which the Court found thatexigent circumstances may constitutionally justify a searchwithout notice to the target. Footnote 16 of Katz, however,does not address the issue now presented as directly as Bergerand the other authorities discussed in this Memorandum.

80. This court recognizes that the government is faced with adilemma when there is a conflict between its duty to be candidwith the court in its applications for warrants and its desire toprotect the identity of its informants. In the rare cases inwhich the government has been caught after mischaracterizing therole of its informants in applications for warrants, thispractice has been properly condemned. Strini, 658 F.2d at 598;Falls, 34 F.3d at 681-82. In Strini, the Court of Appeals forthe Eighth Circuit stated that:

We emphasize that we do not condone the masking of the identity of the informant to the court. We cannot sanction any attempt to mislead the court. We point out that there are alternative procedures open to the government to protect the name of an informant and they should be used in the future.

Strini, 658 F.2d at 598.

This direction, however, has not always been followed. Falls,34 F.3d at 682 n. 6. In Falls, in an attempt to keep awitness's cooperation from being discerned, the prosecutor whosedeceptive conduct was criticized in Strini mischaracterized thecooperating witness as an individual who was continuing to commitcrimes. Falls, 34 F.3d at 681-82 and n. 6. In response, thecourt wrote:

[W]e expressly disapprove of the government's failure to inform the issuing judge that C/W-1 was Thelma Wyant. We are not unsympathetic to the need to ensure the safety of cooperating witnesses in this type of situation. However, safety concerns are not compromised by sworn testimony before the issuing judge fully disclosing the fact of and the reason for masking the witness's identity in the affidavit.

Id. at 682 (citations omitted).

This court agrees with the Court of Appeals for the EighthCircuit that neither the Fourth Amendment nor Title III permitthe government to make false or misleading representations to thecourt in order to protect the confidentiality of its informants.Rather, the government must candidly provide requiredinformation, in a form acceptable to the court, and assume anyinherent risk that the identity of its informants will bediscovered by others, or forego the opportunity for electronicsurveillance in order to avoid that risk.

81. In Ferrara, this court noted that in Ippolito, 774F.2d at 1486-87, the Court of Appeals for the Ninth Circuit heldthat if a reasonable judge "could have denied" the application iffully informed, the information at issue was material. Ferrara,771 F. Supp. at 1305. Thus, this court stated "materialinformation" could be deemed "to be information which reasonablymight have prompted a district judge being asked to issue thewarrant to have denied the request. If a reasonable judge eithermight or might not have authorized the requested electronicsurveillance if fully informed, the information at issue ismaterial, and its omission requires suppression." Id. Thisstatement was premised on the understanding that there may bematters on which reasonable judges would differ and if thegovernment intentionally or with reckless disregard for the truthfiled a false or misleading application, in order to deter suchmisconduct, suppression should be granted if any reasonable judgewould have declined to authorize the warrant. In Ferrara and inthe instant case the government argued that this formulation of"materiality" is more favorable to the defendants than thestandard established by Franks. Because it ultimately makes nodifference to the outcome in the instant case, as in Ferrara,id. at 1305-06, the court has employed the standard for definingmateriality advocated by the government.

82. The court recognizes that, as Flemmi argues, there arecases finding no standing that have stated that "a defendant hasstanding to challenge electronic surveillance only if he can`show that it was directed at him, that the Governmentintercepted his conversations or that the [intercepted]communications occurred at least partly on his premises.'"United States v. Gambale, 610 F. Supp. 1515, 1521 (D.Mass. 1985)(Keeton, J.) (quoting United States v. Williams, 580 F.2d 578,583 (D.C.Cir. 1978)); United States v. Mavroules, 813 F. Supp. 115,117 (D.Mass. 1993) (Collings, Mag. J.) (quoting Gambale,supra). These statements are, however, dicta in decisions thatdid not address, let alone analyze, the issue presented in theinstant case.

83. Section 2510(2) states in full that:

"oral communication" means any oral communication uttered by a person exhibiting an expectation that such communication is not subject to interception under circumstances justifying such expectation, but such term does not include any electronic communication . . .

84. In Alderman, the Supreme Court, in dicta, noted that inenacting Title III Congress could have extended the right tolitigate a motion to suppress an alleged violation of the statuteto persons who did not have standing to allege a Fourth Amendmentviolation, but did not do so. 394 U.S. at 175-76 & n. 9, 89 S.Ct.961. The Court recognized that only an "aggrieved person" maymove to suppress the contents of an oral communication for aviolation of Title III and stated that the "Act's legislativehistory indicates that `aggrieved person' . . . should beconstrued in accordance with existent standing rules." Id. Thiscourt believes that the dicta in Alderman essentially presentsthe same issue as the legislative history of § 2510(2) concerningthe meaning of "existing law," and does not indicate how thatissue should be resolved.

85. In the instant case the government has indicated that inlight of Carter, if Cunningham were to arise now it wouldargue that the defendant did not have a justifiable expectationof privacy concerning the conversations in a tavern at issue inCunningham, 113 F.3d at 290, and, therefore, was not an"aggrieved person" with standing to move to suppress theinterception of those conversations. Apr. 13, 1999 Tr. at 67.

86. It might also be reasoned that Title III recognizes thatthere are circumstances in which a person knows that he is beingoverheard, but justifiably expects that he will not be recorded,because 18 U.S.C. § 2511(2)(c) and (2)(d), which authorize theconsensual recording of conversations in certain circumstances,would otherwise be superfluous with regard to oral communicationsbecause when Title III was enacted the Supreme Court had heldthat an individual did not for Fourth Amendment purposes have alegitimate expectation that someone to whom he was speaking inperson would not record his statements. See United States v.White, 401 U.S. 745, 91 S.Ct. 1122, 28 L.Ed.2d 453 (1971);Hoffa v. United States, 385 U.S. 293, 87 S.Ct. 408, 17 L.Ed.2d374 (1966). See also In re High Fructose Corn Syrup AntitrustLitig., 46 F. Supp.2d at 825-26. As has been noted in rejectingthis reasoning, however, §§ 2511(2)(c) and (2)(d) also apply to"wire and electronic types of communication, which, at least inthe case of wire communications, are protected againstinterception regardless of the speaker's reasonable expectationof privacy." In re High Fructose Corn Syrup Antitrust Litig.,46 F. Supp.2d at 827. Absent § 2511(2)(c) and (2)(d), consensualmonitoring of telephone conversations would not be permitted. Itappears to this court that although redundant in view of thedefinition of "oral communication" in § 2510(2), oralcommunications were included in §§ 2511(2)(c) and (2)(d) to makeclear that the statute authorized consensual monitoring of personto person discussions as well as telephone conversations. Thefailure to include oral communications in those provisions couldhave given the mistaken impression that consensual monitoring ofsuch discussions was not permitted.

87. The court also intends to decide the motion to suppressthe evidence intercepted at the Hilton Hotel on December 11,1991, prior to deciding the motion to dismiss because if thatmotion to suppress is meritorious, it has implications for themerits of the motion to dismiss.

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