Judge dismisses 1 extortion count in Joseph Percoco corruption trial

The federal judge overseeing the Manhattan federal court corruption trial of Joseph Percoco dismissed one extortion count against Gov. Andrew Cuomo’s former right-hand man on Monday and cleared the way for the start of closing arguments.

U.S. District Judge Valerie Caproni said $35,000 Percoco received from two Syracuse developers in 2014, while he temporarily left the government to run Cuomo’s re-election campaign, could support bribery charges but couldn’t be the basis of extortion if he wasn’t using official power.

“I don’t think it’s actually extortion unless you’re a public official,” Caproni said.

Percoco, 48, of South Salem in Westchester County, is accused of doing favors for Syracuse developers Steve Aiello and Joseph Gerardi when he returned to government in late 2014. Percoco is also accused of aiding energy executive Peter Galbraith Kelly in return for a “low show” job for his wife, Lisa Percoco.

Joseph Percoco still faces six counts, including extortion counts involving Kelly, as well as soliciting bribes, conspiracy, and honest-services fraud, a staple of public corruption cases. Aiello and Gerardi face three counts each, and Kelly faces two counts.

The defense rested on Monday after Percoco’s lawyers called Mary Beth Labate, a former state budget director, as a witness. She testified that Percoco didn’t pressure her when he called to ask about releasing state funds for an upstate “film hub” involving the two Syracuse developers — one of the favors for which prosecutors say he took money.

All four defendants told Caproni they didn’t want to take the stand in their own defense, setting the stage for summations to begin on Tuesday morning and expected to continue over three days.

Prosecutors say the bribes were arranged by Todd Howe, an ex-lobbyist and government witness, whose credibility was called into question when he was arrested in the midst of cross-examination after appearing to admit to committing credit card fraud on top of previous convictions for bribery, embezzlement and bank theft.

The government is expected to rely heavily on emails between Percoco and Howe in which they discuss getting “ziti” — a code word for money that Howe said came from “The Sopranos” — from Kelly and the Syracuse developers.

Kelly’s company, Competitive Power Ventures, hired Lisa Percoco for $90,000 a year to help design and occasionally teach in an energy education program for elementary students, and Joseph Percoco in return, allegedly helped push a power plant the company was developing.

Howe also allegedly arranged $35,000 in payments from COR Development, Aiello and Gerardi’s company, in return for cutting red-tape on the film hub and another Syracuse development, and pushing through a raise for Aiello’s son, who worked for Cuomo.

Percoco contends that his wife got a job through Kelly out of friendship, that he never agreed to a corrupt quid-pro-quo in return for it, and that the money he got from the Syracuse developers was paid legal consulting work while he was out of government.