T. Milton Street jury: We’re deadlocked on 7 charges

The federal jury considering fraud and tax charges against T. Milton Street ended a second full day of deliberations telling the judge they were deadlocked on seven charges.

But U.S. District Judge Legrome D. Davis did not declare a mistrial, telling the 12 jurors he and the defense and government lawyers had decided that "you need to continue discussing the case."

At that point, shortly before 4 p.m., the jury decided to stop deliberations for the day and return tomorrow to resume their review at the federal courthouse in Center City.

It was not clear, based on the juror's note, whether they had reached verdicts on any of the counts against T. Milton Street and co-defendant John H. Velardi Sr. of what those verdicts might be.

This morning, the jurors deliberated about 50 minutes this morning before sending out a note containing three questions that the judge described as thoughtful and "very subtle."

The jury asked Davis to repeat 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 redefined 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, the judge explained, the jury had to find that the government proved each element of the crimes - mail and wire fraud and various tax counts - beyond a reasonable doubt.

As for the document date issue, Davis, said the jurors would have to use their collective memories of the trial to resolve the discrepancy: "This is a fact question, a factual inconsistency, and you are the finders of fact."

The jury resumed deliberations at 10:55 a.m.

The jury began its review of the evidence beginning late on Tuesday afternoon and spent a full day yesterday deliberating in the charges against Street and co-defendant John H. Velardi Sr.

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 of consulting fees not earned in his $30,000-a-year food-vending business between 2000 and 2004. Street 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 prosecutors say Street and Velardi knew did not exist.

Yesterday, the jurors remained behind closed doors except for 15 minutes when they returned to court to ask Davis for guidance about how to gauge the legitimacy of Street's tax resister defense.

The jurors asked Davis to re-explain the legal definition of "willful blindness" and Street's stated belief that the U.S. Tax Code is unconstitutional justified not filing tax returns.

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."

The alleged fraud, prosecution witnesses testified, involved Street's and Velardi's attempt to assign an airport subcontract to Thanh Nguyen and his V-Tech Services Inc. to recoup money Street owed Velardi's employer, Philadelphia Airport Services.

Prosecutors allege that the rights to the subcontract between PAS and Street's Notlim Inc. were not Street's to sell because the deal was voided by airport officials earlier in 2003 after Mayor John Street ordered his older brother to withdraw because the deal seemed inappropriate. Prosecutors say the ex-mayor was not involved in his brother's alleged crimes.

Nguyen testified on Feb. 11 that after he paid Street $80,000, the subcontract assignment kept getting postponed and Street and Velardi stopped returning his calls.

Street testified that he never promised Nguyen the deal was certain and that it was Nguyen's idea to give him a good-faith deposit of cash. Street called Nguyen and prosecution witnesses liars.

Velardi did not testify, but his lawyer described him as a pawn between Street's scheming and Nguyen's desperate efforts to win a city contract.