In early 1998, Nicky Scarfo first tried to regain control of the Philadelphia Family through his son as a proxy. Ralph Natale at one point offered through a Lucchese contact to take Scarfo Jr in, straighten him out, and make him a Captain in Atlantic City, but the Scarfos declined. Through Vic Amuso, Scarfo put out contracts on Natale, Joseph Merlino, and Ronald Previte and there was word of Lucchese hit teams being sent to the Jersey shore to kill Merlino. On March 10, 1998, Previte recorded Natale talking about the contracts. Previte brought up a news report that indicated the New York Families were backing Scarfo's play, to which Natale responded: "There is no sitting Commission right now. There is nobody reaching out and the biggest Family in New York... Is the Chin's Family... The kid who runs it now [Bellomo] told [Scarfo] there's only one Boss in Philadelphia, and that's Ralph Natale. And that's where the fuck it's at."

The situation with the Genovese Family started to sour after Natale was arrested for violating parole in 1998. Merlino passed a message to the Genovese Family through Peter Caprio asking permission to induct members from Boston. On any major decisions, Natale and Merlino needed the Genovese Family's okay, and they would use Caprio as a messenger. Caprio would in turn contact Genovese members Vito Alberti and Lawrence Ricci (who was a cousin of Philadelphia member Vincent Centorino). The Genovese Family said no, but Merlino made them anyway. In addition, the Genovese Family was upset with Merlino for failing to send money Natale's way after he got arrested. Things came to a peak a year later when Merlino himself was indicted and Natale flipped. The Genovese Family was embarrassed by Natale flipping because they put him in the position as Boss, so because of this they were refusing to recognise Joseph Ligambi as Acting Boss.

At that point, the Genovese Family were setting up a joint video-poker business in Philadelphia between Vito Alberti and Daniel D'Ambrosia, who was on record with Caprio. However, because they were refusing to recognise Ligambi they did not want to cut him in on any of the proceeds. Caprio knew if they did this, Ligambi would have D'Ambrosia killed. To prevent this from happening, Caprio got the backing of the Genovese and Gambino Families to kill Ligambi and step up as Boss of Philadelphia. It was also decided that if Ligambi was going to be killed, they would have to take out Steven Mazzone and George Borgesi as well. On the Genovese side, Caprio was dealing with Alberti and Ricci, and from the Gambinos, Caprio was communicating with Anthony Proto.

After stepping up to run the Family, Ligambi had reached out to Caprio to set up meetings in New York so he could be introduced as the new Acting Boss. The plan therefore was to lure Ligambi, Mazzone, and Borgesi up to North Jersey under the pretence of meeting representatives of the New York Families. They would be taken to a warehouse where Caprio and D'Ambrosia would shoot them to death. The bodies would be taken to another warehouse or construction site and burried. Alberti, Proto, Vincent Centorino, and Raymond LePore were also involved in the conspiracy. Caprio also wanted to kill associate Philip Casale for unrelated reasons and bury him in the same hole. When this was done, Caprio would be made the Boss. He would straighten out D'Ambrosia and LePore and make D'Ambrosia his Underboss. Martin Angelina would have been made Consigliere. However, Caprio was arrested and flipped before this could take place and the plan fell apart.

A couple of years later, an associate linked to the Lawrence Dentico crew was observed delivering tribute from a gambling operation to a "high-ranking" Philadelphia member, so it appears relations normalised quite quickly. Interestingly, when Larry Ricci disappeared in 2005, an investigator mentioned in a press statement that one possible motive for the murder was that Ricci had approved Caprio's plan to take over without getting the okay from the Family leadership. It's unclear if Ricci was setting Caprio up for a Tony Caponigro situation or if the Genovese Family were just lying about their involvement after the plan failed.

Either way, Merlino does not seem to have had any major problems with the Genovese Family since his release from prison. He has been observed meeting with Genovese Captains including Pasquale Parrello, Daniel Pagano, and Eugene Onofrio. Parrello has also been observed in Philadelphia meeting with George Borgesi. During Merlino's last trial, an FBI agent testified that their information suggested the Philadelphia Family was once again answering to the Genovese Family as they had done at the beginning of Natale and Merlino's reign. This would seem to be the same arrangement as the DeCavalcante Family being subservient to the Gambino Family.