Sunday, September 21, 2003
Copyright © Las Vegas Review-Journal

BOOK EXCERPT: John L. Smith, 'Of Rats and Men'

Mob Mouthpiece

"Of Rats and Men" By John L. Smith Huntington Press Hardcover, $25.95 Although Oscar Goodman would gain a national reputation for representing a variety of organized crime figures, none was more important to his career than Anthony Spilotro. Spilotro, the Chicago mob's muscle in Las Vegas, was a suspect in more than 20 murders but was never convicted of a crime while Goodman was his lawyer. That representation ended in June 1986, when the bodies of Tony and brother Michael Spilotro were unearthed in an Indiana cornfield. REVIEW-JOURNAL FILES Meet the kid from Philly as a youth, Oscar Goodman was an intellectually gifted class comedian who possessed a flair for the dramatic. As a schoolboy, he didn't let his lack of physical prowess stop him from getting in sidewalk scraps, pickup basketball games with bigger players, or turning out for the football team. REVIEW-JOURNAL FILES Oscar Goodman was comfortable in a courtroom but had a lot of catching up to do when he finally decided to enter politics by running for mayor in 1998. His entry into the race caused laughter in some political circles and groans in others, but it wasn't long before even the most skeptical pundits were taking him seriously. REVIEW-JOURNAL FILES

Today and next Sunday we are presenting excerpts from Review-Journal columnist John L. Smith's new book "Of Rats and Men: Oscar Goodman's Life from Mob Mouthpiece to Mayor of Las Vegas," which is published by Huntington Press and goes on sale next month. The book takes readers through Goodman's 35-year career as the country's pre-eminent defense attorney for gangsters such as Meyer Lansky, Anthony Spilotro, Frank Rosenthal, Jimmy Chagra and Phil Leonetti, and then recounts how he pulled off a most unlikely career change by getting himself twice elected mayor of Las Vegas -- the self-described "happiest mayor in America."

By the time he needed Oscar Goodman's help, Frank Rosenthal already had carved out a personal legend as a Chicago Outfit bookmaker and handicapper. To police from Miami to Las Vegas, he was "Lefty," one of the top brains in the national illegal-bookmaking syndicate. To his intimates, he was "Crazy," the brilliant but volatile gambler who wasn't shy about puffing out his chest. Not only was he a gifted handicapper, but he held status as a supreme earner and a friend of Outfit underbosses. In early 1971, he was joined in Las Vegas by Anthony Spilotro, his violent old pal from Chicago. Spilotro was immediately targeted by police.

He wasn't hard to find. For a short guy, Tony Spilotro was never good at keeping his head down. Instead of remaining part of the scenery in Southern Nevada, he began showing up at almost all the local casinos. He drove a brand new chocolate-brown Mark IV Lincoln Continental and spent money like a sailor on holiday.

In June 1971, Spilotro was arrested in Las Vegas by Clark County Sheriff's deputies and charged with vagrancy. Although he could show "no visible means of support," he drove a new car and carried a fat bankroll. The charges were later dropped, but Spilotro was on notice. The misdemeanor charge and thinly veiled police harassment reverberated from Las Vegas to Chicago, where Spilotro's arrest made headlines in the Chicago Sun-Times.

That sort of treatment continued for the next few months, until police received a genuine excuse to pick up Spilotro: He was arrested on charges stemming from the 1963 Leo Foreman murder. Jailed in Las Vegas, he needed someone to vouch for his character in order to make bail. The only man who could do so was Frank Rosenthal, who at the time was trying to persuade authorities he had shaken off his notorious past in an attempt to land a coveted state gaming license. In a rare break, neither the police nor the press took notice; Spilotro was eventually acquitted of the Foreman murder and Rosenthal managed to keep from being burned by his pal Tony's intense notoriety. Goodman, the attorney for both men, thought little of it.

It wasn't until March 1974 that Goodman recalls beginning to recognize with certainty the depth of Rosenthal's relationship with Spilotro. Spilotro had been arrested for the June 23, 1973, murder of William "Red" Klim, a Caesars Palace casino employee who had been shot Outfit style -- two bullets behind the ear and one in the chest -- in the parking lot of the Churchill Downs Race Book. Was Klim cooperating with authorities in the federal gambling investigation? Did Klim have information damaging to Spilotro, who was then under investigation for defrauding the Teamsters Central States Pension Fund of $1.4 million for loans to a Deming, N.M., plastics factory?

Or was Klim, as some knowledgeable Las Vegans believe, a loan shark who refused to pay tribute to Rosenthal and Spilotro?

Goodman says he never learned of the motive for Klim's murder. But he surprised many observers when he used Rosenthal, still embroiled in his own battles with state gaming authorities, to vouch for the accused killer's character before Justice of the Peace Robert Legakes. Not long after, Legakes would be suspected by the FBI of doing business for the Chicago Outfit.

"I don't see things the way other people see them," Goodman said. "I see them through my looking glass, my rose-colored glasses. And perhaps my gin-soaked brain cells. I was there, and I went back and certainly I used Rosenthal as a character witness. This may have been a mistake, but I didn't know that. If I had a crystal ball and could have seen what was ahead -- or what the truth was -- I wouldn't have done a lot of things. But in my naiveté, when Tony was arrested for Red Klim's murder on a Sunday, I had Ray Jeffers come down in front of Bob Legakes, who was the justice of the peace, to have a bail hearing. Who did I call as Tony's character witness? The guy who introduced him to me: Frank Rosenthal. And Frank said, 'Yeah, Tony and I are buddies. We go back all the way to our childhood in Chicago.' I didn't give it a second thought, mixing the two of them together.

"It was right there. And if I knew that these guys were who they turned out to be, and I was part of trying to maintain the secret of who they were, I certainly wouldn't have put them together.

"At the time -- and I know this will sound unbelievable -- I didn't know they were all that friendly with each other. The business they were in isn't as it's portrayed on television and in the movies. There are very few instances in which all the principal parties involved in a massive conspiracy are in the same room. And, perhaps with one or two exceptions, they'd never allow an outsider to sit in and listen. And again, this will sound like a line, but I was an outsider.

"I had a certain knowledge and I'd had the kind of success in cases these men understood. But I wasn't a consigliere. In fact, I was like a lot of other people in those days. I didn't know Chicago and Kansas City and whoever else had the Stardust and all those other casinos. Remember, the owners were always licensed by the Gaming Control Board, and the politicians were fond of being quoted at length in the press about how legitimate Nevada gambling was. Well, a lot of people knew it wasn't as lily white as the politicians claimed, but no one was going around naming names."

The silence on the street, anyway, was due to Spilotro's reputation for violence. During those years, whenever a gambler was found shot in the head, Spilotro or one of his cronies immediately became a suspect. Whether it was the demise of Red Klim and illegal bookmaker Jerry Dellmann, the disappearance of casino host Johnny Pappas, or the murders of nearly two dozen others, for more than a decade, Spilotro was the target. For a street guy to talk about the Outfit's business in Las Vegas behind the Little Guy's back was to put himself in serious harm's way.

Harry Claiborne recalled trying unsuccessfully to school Goodman against representing organized crime.

"I have all my life steered away from the mob guys in my practice, and I had numerous opportunities," Claiborne said. "I guess the only one I ever had was Doc Stacher. I simply always had a feeling that there was no way you could represent one of those guys without pretty soon learning too much, and when you learned too much about their activities you were expendable, in my opinion. And I just wanted to live a long time. That was my sole reason.

"I told Oscar something, but by this time Oscar had gone money crazy. His lifestyle changed. His requirement for money was great. He began to focus mainly on fees. He reached a point where his ability began to be recognized and his fee schedule increased accordingly. That's not a knock. I think all lawyers do it, but he was looking for clients who could pay large fees and they were looking for good counsel. It was kind of a natural progression of things."

Goodman's denial is all the more intriguing given the fact that, by 1973, Rosenthal's underworld connections were widely known. Although he was primarily a gambler, his association with mobsters in Chicago and Florida and his connection with two major sports scandals were the stuff of Chicago Crime Commission reports and Senate subcommittee records. But it's also important to remember that few casino men or high-rolling gamblers were without some connection to the mob. Frank Rosenthal's colorful background was far from unique.

Goodman had little difficulty beating the charges on behalf of his client in the Klim murder case. Although Klim was shot less than 100 feet from the front door of the Churchill Downs, witnesses appeared unable or unwilling to step forward to describe the killer.

Jay Sarno IRS case

Jay Sarno was the greatest big-idea man in the history of Las Vegas. He envisioned Caesars Palace, a plush casino with a Roman theme, and saw it built in 1966. He then came up with the idea for Circus Circus, the city's first true family resort, which not only featured a sprawling carnival midway, but also a trapeze above the casino floor, and lived to see his dream come true in 1968.

Sarno's connections fueled his visions and plans. He knew representatives of the Teamsters Central States Pension Fund, which saw fit to make millions in loans for Caesars Palace and Circus Circus. He also knew the representatives of the Chicago Outfit, including Tough Tony Spilotro. Sarno leased space to Spilotro for a gift shop at Circus Circus under the name Anthony Stuart.

Due to Sarno's connections, he was a prime target for federal investigators, and his sloppy income-tax returns made him easy pickings for the Internal Revenue Service. Sarno's personal and corporate tax returns for the years 1968 through 1971 were a mess and in the early '70s, Sarno and his associate, local businessman Leo Crutchfield, began receiving calls and visits from IRS agents.

By September 1973, Sarno was getting desperate. He owed the government big and needed time to pay. In conversations with IRS agents, Crutchfield and Sarno began offering them cash. When Sarno, Circus Circus executive Stanley Mallin, and Crutchfield were indicted for conspiring to bribe an Internal Revenue Service agent, the case wound up in U.S. District Judge Roger Foley's courtroom. Goodman represented Sarno, Harry Claiborne defended Mallin, and Crutchfield was severed after he began cooperating with the government.

The trial began in February 1975 and lasted nearly a month. Justice Department prosecutor James Duff guided jurors through a series of alleged events in which Sarno and Crutchfield, and to a lesser extent Mallin, attempted to find a way to securely bribe one of the IRS agents. At one point, according to Duff, Sarno attempted to induce the agent to meet with him in the steam room at Circus Circus. Without clothes, there would be no way to bug the conversation.

Goodman and Claiborne countered with an elaborate and persuasive defense, contending the defendants were innocent men with no predisposition to commit such a crime. Rather, they were the victims of entrapment by greedy government agents.

While government prosecutors claimed that Sarno and Mallin had practiced despicable behavior worthy of lengthy prison sentences, Goodman and Claiborne created the image of an IRS watchdog that was off its leash. Then Mallin and Sarno took the stand and told of being afraid of the IRS agents. If those government agents were corrupt, Goodman asked, who could Sarno and Mallin be expected to run to?

"We were stupid, we were idiotic, and we were wrong," Sarno pleaded to the jury. "But we were scared. We saw how they could be. We were frightened of the IRS. I was paying him not to frame me and put me in the can."

At one point, Goodman used an elaborate chain-of-events chart as a visual aid. Although such props are commonly used now, they were novel in the mid-1970s.

"I use demonstrative evidence more than scientific evidence, and I learned that from Jay Sarno," Goodman said. "During his bribery trial, I had this huge chart in front of the jury, 'Government Entrapment Efforts,' and the government didn't object. At one point, after I finished my closing argument, one of the jurors corrected a mistake I'd made. He said, 'Excuse me, but August has thirty-one days, not thirty.' That really sunk in -- the jury studied the chart. It was pretty impressive. Sarno gave me the idea. He said, 'You can't just go out there and talk. You have to show these people these things. You have to make things visual to them.' It was another great idea from Jay Sarno. He really was a genius.

"Sarno also taught me a lot about the incredible anxiety a defendant goes through. It was while representing Sarno that I realized my clients needed to be defended, not only in the courtroom, but in the press as well. Some people will call that ego, but in my estimation it's very important. It violates a rule of procedure, but it's a rule that's made to be broken. I will not take the initiative, but when the prosecutors send out their press releases, which they do in just about every case I'm involved in, and I see the press release in black and white and it goes way over the line, I feel my function is more than just to get a not guilty or to resolve the case in my client's favor. I think my function really is as their spokesperson. Because as Jay Sarno said when he was indicted, 'This indictment is a ninety-nine percent conviction. I haven't even gone to trial, but I've lost all my friends. I don't have any access to money anymore; my funding has dried up. I'm through unless I win.' For someone like Jay Sarno, the mere charge was enough to kill him."

Nevadans have traditionally been mistrustful of the federal government. Goodman seized the moment and enlisted his client, Sarno, to do the same.

"I am incensed and enraged by the Gestapo-type tactics that were used against these men," Goodman said. "It is not the role of government to embark on a horrendous scheme to put these men in a situation where they are forced to bribe a federal agent. ... The same thing that happened in Watergate must end right here and now."

In the end, the jury was unable to reach a verdict. Foley declared a mistrial, then quickly granted a defense motion for acquittal.

When his travails had ended, Sarno said, "These men saved our lives. I'm grateful we had a learned judge and two fine attorneys."

"I don't think Harry Claiborne ever charged a big fee before he met me," Goodman recalled. "I think I taught him how to charge a big fee. When I represented Sarno, I charged a lot of money and Claiborne followed suit. Before that, he loved what he did so much, he couldn't have cared less about the money."

Interviewed years later, Claiborne observed, "I think money was very important to Oscar. He was a fine attorney, but he was very focused on making a lot of money."

Mouthpiece

or mobster?

Always in the public eye, Goodman's reputation as a capable representative of organized crime was rarely in doubt. One story holds that, at one point, the Chicago Outfit became dissatisfied with him and sent attorney Dominic Gentile to Las Vegas as a reinforcement against the federal investigative onslaught. The tale, believed by police and FBI agents, was refuted by Gentile in Alan Balboni's book, "Beyond the Mafia: Italian Americans and the Development of Las Vegas."

"Gentile did not let these bizarre stories bother him," Balboni wrote. " ... Gentile did not challenge Goodman's role; indeed, the two defense attorneys occasionally cooperated."

Both were dedicated to defending Spilotro.

"I learned it a couple of years later," Gentile recalled. "There really was no truth to it at all. In fact, when I found out about it, I was really kind of angry, because I'd had all this burden that I didn't know about and none of the benefit that should have gone with it if it were true.

"If Oscar says he was lucky, I think he's right, at least from the standpoint of timing," Gentile added, commenting on Goodman's early career. "His arrival in Las Vegas coincided with a stepping up of federal organized-crime enforcement activity. If you think about it, he got here right about the time Attorney General Bobby Kennedy and Bob Blakely, the creator of the RICO statute, were most active. It was right at the time the immunity law was put into effect. It was right at the time when the new federal wiretap statute went into effect. All these federal laws were created, and no one knew about them, because they were brand new. Any time you have new laws, you have unlimited potential for creativity, and God knows Oscar does not lack for creativity. He happened to be in the right place at the right time and he made the most of it. Oscar was right there at the most propitious moment."

But that opportunity was double-edged.

"The FBI figured Oscar couldn't represent all these people without in some way being used by them for illegal purposes," Harry Claiborne said. "Even though they had no proof of it, and I'm sure it didn't exist, it didn't have to exist in order for them to be certain that it was occurring. And pretty soon they didn't distinguish between criminal activity and legal services. Nor did they try to."

Claiborne believes Goodman became victimized by his legal associations.

"I'm sure that's what happened to Oscar," he said. "It would be very difficult to convince any of the law enforcement agents at work in the mob investigations that all of Oscar's activities were without criminality. In other words, they would believe that any lawyer who represented those people more than once was one of them. It wouldn't have made any difference who it was."

Goodman, of course, compounded his image problem by relentlessly ripping at the character of the FBI and Department of Justice.

Mob? What mob?

"Nobody will ever believe this, but I never had any idea that Chicago and Kansas City and Milwaukee were running the Stardust, Fremont, Marina, and Hacienda," Goodman said. "I didn't know that. I knew that (Allen) Glick was there, and I thought that he was the boss. And I knew that Rosenthal exercised some influence, but I never knew to what degree. I knew that Rosenthal had known Spilotro, but I never really thought that Rosenthal was part of Chicago. I mean, I knew he had associates back then. Wizard Angelini was his friend, but I never saw him having that close of a relationship with Spilotro. Over the years, I've come to find out that it was a lot closer than I thought it was. Had I known then what I know now, instead of making $12,000 a month from him, I would have made $120,000. I didn't realize what it was all about. I was on the up and up. I was a square guy who was doing everything as though I thought it was all legit."

But Goodman's protestations seem laughable in the face of the facts.

In March 1978, the IRS announced it was inquiring into the tax records and financial status, not only of Anthony Spilotro, but of Oscar Goodman as well. Though those financial documents were generated by officers at First National Bank, Valley Bank, and Grand Resorts Inc., bank officials refused to turn them over to IRS investigators. They refused even in the face of Spilotro's public links to organized crime through a devastating Time magazine article, which called him the supervisor of the Mafia's Las Vegas gambling operations and a close associate of Felix "Milwaukee Phil" Alderesio.

After a one-day hearing, U.S. District Judge Roger Foley, in a move that surely disappointed those who believed he had an improper relationship with Goodman and his clients, ordered that the information be turned over to the IRS. The best Goodman could manage was a lengthy oral battering of IRS Agent Leo Halper.

"I think they'd rather get the lawyer than the client," Goodman told a National Law Journal reporter. "The newspapers are running blaring headlines and the prosecutors are holding press conferences, and it's very difficult to shadow-box with dime-store-novel allegations."

Of course, there were plenty of people in federal law enforcement who believed the lawyer was worth getting.

"Well, if he wasn't a consigliere, he was the closest goddamn thing to it," said one ex-Strike Force attorney interviewed under the condition he remain anonymous. "I'll say this for Oscar, I think he's one of the best attorneys I've ever seen argue a motion. He's not half the trial lawyer he's said to be, but he argued a motion as well as anyone I've ever seen."

Defending

Jimmy Chagra

Oscar Goodman admits he finds rays of hope under the darkest circumstances. It was that way in the case of the U.S. vs. Jamiel "Jimmy" Chagra.

Chagra was accused of obstructing justice, conspiring to distribute a small mountain of marijuana, conspiracy to commit murder, and murder itself (the assassination of San Antonio federal Judge John Wood). With plentiful wiretap surveillance, along with the testimony of cooperating witnesses and paid informants, Goodman's task was monumental. And the government knew it.

To defuse the bomb, Goodman knew he would have to concede parts of the indictment or risk losing credibility before the jury. From the evidence presented, it was obvious Jimmy Chagra had conspired to ship vast quantities of marijuana and planned his own escape from Leavenworth penitentiary. To deny the obvious would ruin any chance to beat the charges relating to the murder of John Wood. That made his opening statement crucial.

Goodman attempted to use his apparent weaknesses as strengths. Chagra was no stranger to the court system. In fact, he had run up against Judge Wood and lost in a Midland, Texas, trial. He was already faced with a long prison sentence, and the new federal charges promised to add perhaps five years to his overall sentence.

This led Goodman to ask the jury, "Is someone going to hire someone to kill a federal judge over a five-year differential?"

It wasn't a murder-for-hire plot, Goodman proposed, but extortion after the fact. Hit man Charles Harrelson (father of actor Woody Harrelson) saw Chagra as a mark, as evidenced by his attempt to con him out of several hundred thousand dollars in a rigged poker game in Las Vegas, and the Wood assassination was Harrelson's chance for the score of a lifetime.

As the trial started, Goodman learned the government was going to use Jerry Ray James as a witness.

"Jerry Ray James is one of the greatest embarrassments in the history of federal prosecution. When they decided, in their zeal to put away Jimmy Chagra, to stoop so low as to use this vicious, evil, conniving human being, this subhuman being, they handed me a mallet to hit them with.

"The more I learned about him, the more I realized James cut one of the great deals in history. It was outrageous, but I saw that the government was stopping at nothing to get its man."

James was a career criminal with more than 30 felony arrests.

The Justice Department was even willing to purchase testimony in order to get Jimmy Chagra. In hustling his way out of a double-life sentence in Leavenworth, James managed to get the government to agree to pay him a $250,000 bonus if Chagra was convicted.

James testified that Chagra had boasted of planning to kill Wood. Although his words were damning, his character was made to order for Goodman.

Goodman's argument against the recorded evidence was brilliant in its simplicity. Jimmy Chagra, in his attempt to be accepted among the hardened cons in Leavenworth, had only bragged about having a hand in the Wood murder in order to improve his stock inside the penitentiary. He hadn't actually done anything, only lied to a few fellow cons to remain in their good graces.

James admitted on direct examination that Chagra was a big talker. He recounted all the big drug scores Chagra plotted from behind bars. James even recalled Jimmy boasting of offing a man named Mark Finney and burying him in a shallow grave in a stand of pine trees outside Austin.

By the time Goodman had a chance to cross-examine Jerry Ray James, the trial of Jimmy Chagra was nearly a month old. The jurors had heard enough from the prosecution, and the case, save for one outburst from Chagra during James' testimony, had reached a turning point.

Oscar Goodman seized the moment.

His version of the facts of the case was that Jimmy Chagra had been victimized by a homicidal extortionist named Charles Harrelson. Oscar argued that Chagra had never agreed to pay to have Wood killed. Instead, he was forced to hand over nearly $200,000 after the fact in order to prevent Harrelson from implicating him in the crime.

"Mr. Chagra was doing an awful lot of talking to show he was important, that he was heavy into criminal activities, right?" Goodman asked James.

"Yes," came the reply.

Years later, Goodman recalled, "Jimmy was surly. He was brusque. He was really trying to be a tough guy. I'd been around plenty of the real thing, and he wasn't it. I knew it was an act he was putting on in order to get along in prison. He was trying to show he was tough. 'I killed this guy. I killed that guy. I did this. I did that.' It was part of his personality, but Jimmy also had a glint in his eye. He did have life in them, and after all of his gruffness, he would start laughing as though the whole thing was a game."

A 'Perry Mason'

moment

The prosecution rested its case on a Friday, and Goodman spent the weekend mulling his defense strategy. If he attempted to match the government blow for blow, he'd risk losing the jurors on the one hand or rekindling their interest in the prosecution's case on the other. It was clear they had been less than enthusiastic listening to hour after hour of taped testimony; going over the same ground might only stoke their curiosity. Instead, he decided to minimize the damage and focus on the undeniable flaws in the character of Jerry Ray James, the government's key witness. It was a risk Goodman had to take if he was going to save Chagra's life.

On Monday morning, Goodman called James to the witness stand. Heavily prepped for trial, James anticipated being grilled for days at a time. Instead, Goodman kept his inquiry brief. His defense lasted just 12 minutes.

"Describe how Mr. Chagra told you he killed Mark Finney," Goodman said.

"I think he said he shot him."

"Are you sure of that?"

"I'm sure he told me he offed him," James said.

"You're as sure of that as you are that Mr. Chagra told you he murdered Judge Wood?"

"That's right," James said.

"No more questions," Goodman said.

The prosecution appeared momentarily perplexed.

Then Goodman added, "Call Mark Finney."

The supposed dead man strolled into court and raised his right hand. Goodman could bar