After two full days of deliberations, the federal jury considering fraud and tax charges against T. Milton Street Sr. announced yesterday that it was deadlocked on seven charges.
U.S. District Judge Legrome D. Davis declined to declare a mistrial, instead telling the 12 jurors that he and prosecution and defense lawyers had decided that "you need to continue discussing the case."
The jury will return today.
It was not clear, based on the jurors' note alone, whether they had reached verdicts on any of the counts against Street and codefendant John H. Velardi Sr. or what those verdicts were. In court, prosecutors and a defense attorney said the jury had reached verdicts on two counts.
Several of the jurors, drawn from nine counties as far west as Lancaster and as far north as the Lehigh Valley, seemed dismayed that they would have to return to the windowless room in the federal courthouse in Center City, where they have spent a total of 15 hours since getting the case late Tuesday afternoon.
"Can I just make a statement?" interjected one male juror.
Davis cut him off, saying court rules allowed jurors to raise questions only in writing and only through their forewoman.
Neither prosecutors nor defense attorneys would comment on the possible significance of the jury's quandary. Street and Velardi appeared to have no reaction.
If the jury cannot reach a unanimous verdict, the judge will declare a mistrial and prosecutors will decide whether to retry one or both of the defendants.
JoAnne Epps, associate dean at Temple University's Beasley School of Law, said it was hard to determine whether a deadlock would ultimately benefit Street.
"It really depends on why they're deadlocked," she said. "They may be deadlocked over an uncertainty about the law or an uncertainty about what the evidence shows."
One possibility is that some jurors have accepted Street's unexpected argument that income taxes are unconstitutional.
"They may be agreed on facts in the law but unwilling to convict," Epps said. "That is sort of like jury nullification."
She added: "Until later, we won't know if it really is a lack of understanding or whether he has actually struck a chord with one or more members of the jury."
The 2006 indictment alleges that Street, 68, of Moorestown, a well-known food vendor and former Pennsylvania state legislator, failed to pay taxes on $2 million in consulting fees that prosecutors say he earned between 2000 and 2004 by trading on his brother John Street's election as mayor. He is also charged with not filing tax returns in 2002, 2003 and 2004.
In addition to the tax charges against him, Street and Velardi, 54, of Media, director of a city contractor working at Philadelphia International Airport, are charged with wire and mail fraud in an alleged 2003 scheme to defraud a Vietnamese immigrant businessman.
Street, allegedly aided by Velardi, is charged with cheating $80,000 from Thanh Nguyen by selling him the rights to a $3.2 million airport maintenance subcontract that prosecutors say Street and Velardi knew did not exist.
The first sign that jurors might be split came Wednesday morning when they asked the judge for guidance in gauging the legitimacy of Street's defense that his research into the history of the tax code convinced him it is unconstitutional.
The judge said the jurors needed to use their collective experience to decide if Street truly believed his testimony about the validity of the tax code: "The law protects those who are ignorant of the law or who misunderstand the law, but that is not someone who simply disagrees with the law."
By yesterday morning, it was apparent that the divisions extended beyond the concept of T. Milton Street as tax resister.
After deliberating about 50 minutes yesterday, the jury was back with more questions, this time on the mail- and wire-fraud counts against Street and Velardi.
The jury wanted Davis to review again the legal definition of scheme, and whether it could base its verdicts on the brief summaries following each count on the verdict sheet, or the entire text of the 25-page indictment.
The jury also asked for help reconciling what appeared to be a typographical error in the dates on two letters introduced into evidence during the five-day trial.
The judge defined scheme as a "plan to commit a particular type of fraud. Davis said prosecutors did not have to prove every detail of the allegations in the indictment. But to convict, he explained, the jury had to find that the government had proved each element of the crimes - mail and wire fraud and various tax counts - beyond a reasonable doubt.
As for the document date, Davis, said the jurors would have to use their memories of the trial to resolve the discrepancy: "This is a fact question, a factual inconsistency, and you are the finders of fact."
