This requires that you use only 1 controller as it will not work with 2! I tried 2-3 times before I figured this out. :(
Choose Two-Face as one of your characters and enter a level. Press the (Y) button to switch to your 2nd character. Change to a goon and then switch back to your 1st player (Two-Face) and kill the goon ten times. If you completed the Story Mode you have more than likely killed enough Police Officers already for this to pop now. If not, you can now just switch your second character to a Police Officer and kill until you get this.