Digital Bulletin

PROVIDENCE -- A federal jury today returned a mixed verdict in the Roger Williams Medical Center corruption trial that centered on whether hospital executives had abused the honest services of a former state senator -- who became the star witness against them.

Journal photo / Sandor Bodo

Former hospital president Robert A. Urciuoli was found guilty of conspiracy and 35 of 36 counts of mail fraud.

After entering their seventh day of deliberations in U.S. District Court, jurors convicted former hospital president Robert A. Urciuoli of conspiracy and 35 of 36 counts of mail fraud.

They cleared Peter J. Sangermano Jr., a partner in the hospital's assisted-living center, of the same 37 counts against him.

The third defendant, Frances P. Driscoll, a former hospital vice president, was cleared of the conspiracy charge, but convicted of the one other count against her, mail fraud.

U.S. Attorney Robert Corrente said this afternoon that following today's convictions the government will expand its investigation into allegations of public corruption in Rhode Island and that more officials and companies could be implicated.

"There was a good deal of testimony of our dealing with other companies and with other members of the General Assembly," Corrente said. "In January, I told you this was a big investigation that was extremely active. It is now even bigger and more active."

Chief U.S. District Judge Ernest C. Torres freed Urciuoli and Driscoll on bail, pending sentencing March 9, 2007.

A conviction for conspiracy carries a penalty of up to five years in prison and a $250,000 fine. Mail fraud is punishable by up to 20 years in prison and a $250,000 fine.

The defendants had to endure a long wait for the trial's conclusion. Jury selection began Sept. 6. Jurors had started their seventh day of deliberations when they announced that they'd reached a verdict late this morning.

As the verdict was read, Sangermano grinned, looking relieved. Driscoll's daughter, also in the front row, cried.

Urciuoli remained stoic, but his wife, Donna Paolino Urciuoli, sitting in the front row of the gallery, started crying. Urciuoli repeatedly looked at her as the verdict was being read.

Urciuoli and his wife left the courthouse looking shaken. Urciuoli’s lawyer, Richard Egbert, brushed past reporters, saying, “We don’t have any comment at this time.” Urciuoli and his wife then walked through the office building at 50 Kennedy Plaza and over to Westminster Street, occasionally holding hands.

Journal photo / Sandor Bodo

Peter J. Sangermano Jr., a partner in the hospital's assisted-living center, leaves court after being cleared of all counts.

Urciuoli made at least one call on his cell phone, and when asked again for comment, his wife put her hand on a reporter's arm and said, "Would you please just give us some time alone? Thank you."

Michael Connolly, one of Urciuoli's lawyers, said later, "We respectfully but vigorously disagree with the verdict. We're anxious to apply to the 1st Circuit Court of Appeals to have this overturned. We are all extremely disappointed.''

Driscoll left the courthouse a short time later without comment.

Driscoll's lawyer, Kevin Bristow, said, "Fran is devastated...It's incomprehensible how the jury came to that verdict."

Bristow, who called his client a "do-gooder" who has dedicated her life to nonprofit organizations, said he will file a motion for a new trial.

If it comes to sentencing, he will ask the judge to take that and Driscoll’s health into account. She is 67.

“She is extraordinarily upset and extraordinarily disappointed with the jury’s verdict," Bristow said.

“She’s a spiritual person. She’s a person of faith. She’s put her faith in God. She’s put her faith in the fact the truth would come out during the course of the trial and the jury would have the ability to appreciate that truth.

"So when the jury stands up and says, ‘You are not guilty of this conspiracy but the day before you left you somehow were involved in a mail fraud, the mailing of a paycheck,’ it’s just incredibly difficult for her to comprehend, and I think it’s difficult for anyone to comprehend,” Bristow said.

Bristow said he will file a motion for a new trial. And if it comes to sentencing, he will ask the judge to take into account Driscoll’s health and the good that Driscoll has done in her life. “She’s not well,” he said. “She has been sick a long time. She has a debilitating illness.”

Journal photo / Sandor Bodo

Frances P. Driscoll, a former hospital vice president, was cleared of conspiracy, but convicted of one mail fraud count.

Bristow said Driscoll wanted to testify during the trial, but her health “virtually made it impossible for her to testify.” He declined to specify her health problems other than to say, “She has been under the full-time care of a physician for a long period of time. She has a particular illness, and it’s exacerbated by what’s gone on here.”

Sangermano and lawyer, John Pappalardo, stood on the courthouse steps minutes after Sangermano was cleared, calling the verdict the “product of a less than stellar investigation and obviously a flawed prosecution.”

A reporter asked what Sangermano was going to do next. “The same thing he’s always done,” Pappalardo replied. “Conduct himself appropriately.”

A smiling Sangermano and his wife, Diane, appeared outside the court with their lawyer. His wife said they were "relieved" by the verdict.

None of the defendants testified in the trial.

The defendants in January were named in a 38-count indictment, charging them with conspiracy and mail fraud. The indictment alleged that Urciuoli, Driscoll and Sangermano hired Celona as a consultant to The Village at Elmhurst, which was partially owned by the hospital, but that Celona's real work was using his public office to influence legislation and perform favors.

The indictment charged that one or more of the defendants directed Celona on various matters, from legislation to persuading municipalities to increase their ambulance runs to Roger Williams to pressuring health insurers with legislation before his Senate committee to increase their reimbursements to the hospital.

Governor Carcieri issued a statement this afternoon praising the verdict.

"Today’s verdict should resonate throughout the state and send a message that corruption at all levels will not be tolerated. The jury worked hard and sifted through weeks of testimony and saw this case for what it was: State House insiders get special deals," said the governor, who was a former business executive before taking office.

In 1998, the indictment charged, Driscoll and Sangermano directed Celona to work against a bill prohibiting health facilities, including the Village at Elmhurst, from offering care for Alzheimer's disease.

Celona, the once-powerful senator from North Providence, was the star witness at trial. He had previously pleaded guilty to selling his office to Roger Williams, CVS and Blue Cross & Blue Shield of Rhode Island, and testified as part of his agreement to cooperate.

As chairman of the Corporations Committee, Celona had the power to advance or kill bills of importance to companies, including Blue Cross and United Healthcare, each of which were embroiled in a dispute with Roger Williams over insurance payments.

On the witness stand, Celona testified and read memos to the jury recounting how Urciuoli instructed him to pressure United Healthcare and Blue Cross & Blue Shield of Rhode Island to increase their reimbursements to Roger Williams.

Celona testified over six days and was subject to a withering cross-examination from Urciuoli's lawyer, Richard M. Egbert.

The defendants claimed that Celona did legitimate work, tapping into his extensive contacts in the elderly community to recruit residents for the Village at Elmhurst.

The defense argued that Celona's position with the assisted living center was no secret. Celona disclosed his consulting job at Elmhurst, which paid him $257,000 over six years, and Roger Williams obtained an opinion from the Rhode Island Ethics Commission, they said.

The prosecution countered that hospital officials misled the Ethics Commission that Celona worked for the Village at Elmhurst, when the bulk of his work was for the hospital, exerting his political influence.

In his closing argument, Assistant U.S. Attorney Luis Matos said,"The evidence has shown that Robert Urciuoli, Frances Driscoll and Peter Sangermano were willing and able purchasers of that office, and that they intended to deprive the citizens of Rhode Island of John Celona's honest services. John Celona was hired to pursue their political interests, to be their political errand boy."

While acknowledging that Celona was "a political opportunist" and "a corrupt individual who has lied in the past," Matos said that Celona's actions are supported by a mountain of evidence -- a paper trail of faxes, memos and e-mails documenting his pursuits on behalf of the defendants.

Egbert countered, "The government's case, like John Celona's testimony, is built upon a failure of logic and a failure of common sense."

To convict the defendants, Egbert told the jurors, they would have to "embrace" a proven liar in Celona.

"You have to go home tonight and say, 'I believe John Celona, beyond a reasonable doubt,' and be able to sleep well," said Egbert. "Good luck to you!"

The hospital was also charged in the January indictment, making it the first nonprofit institution in Rhode Island to face federal corruption charges. In April, the government agreed to the dismissal of charges against the hospital, which promised to cooperate with the prosecution. The hospital also agreed to more oversight and provide another $4 million in free health care for the poor.

In deliberating, jurors had to mull weeks of testimony, but also had stacks of exhibits to pour through, including many communications between Celona and Roger Williams officials, many to Urciuoli and Driscoll.

Some deal with legislative matters, including Celona's attempts to kill bills at the State House opposed by Roger Williams. Others, presented by the defense, documented frequent appearances by Celona at the Village or its affiliates -- groundbreakings, openings, May breakfasts, summer barbecues, a "pizza wars" contest among local pizzerias.

In his instructions to the jury after testimony had concluded, Torres told the jurors that the government, to win a conviction, had to prove that the defendants intended to deceive the public.

U.S. Attorney Corrente said he gave his staff the rest of Friday off given the convictions. "But Monday morning our work will continue on all fronts, full speed ahead," he said.

Corrente refused to name the other companies or individuals being investigated.

-- With reports from projo.com staff writers Steve Peoples, Kate Bramson, Journal staff writer Edward Fitzpatrick and Journal archival reports