Opinion ID: 621801
Heading Depth: 2
Heading Rank: 1

Heading: The David's Tree Service Extortion Counts

Text: At the core of the government's case against David Cain were allegations that he supervised Jamie Soha and numerous other associates, many of whom testified at trial, in a criminal campaign aimed at cornering the tree service and logging market in northwest New York State. Consistent with this theory, the indictment charged Cain and Soha with three counts of extortion in connection with their efforts to take over business from Keith Kent, Chuck Bracey and Dan Gollus, all of whom were competitors of Cain's company, David's Tree Service. The jury returned guilty verdicts against both defendants on all three counts and the corresponding RICO predicates. On appeal, Soha (joined by David Cain) argues that the proof at trial was inadequate to sustain the jury's guilty finding on the three extortion charges. The Hobbs Act, the statute under which the defendants were convicted, defines extortion as the obtaining of property from another, with his consent, induced by wrongful use of actual or threatened force, violence, or fear, or under color of official right. 18 U.S.C. § 1951(b)(2). In asserting that the evidence at trial was insufficient for the jury to find that this definition was satisfied, the defendants rely heavily on Scheidler v. National Organization for Women, Inc., in which the Supreme Court suggested that property is obtained within the meaning of the Hobbs Act only if the defendants received something of value . . . that they could exercise, transfer, or sell. 537 U.S. 393, 405, 123 S.Ct. 1057, 154 L.Ed.2d 991 (2003) (internal quotation marks omitted). The defendants argue that because the government introduced no evidence that through their coercive conduct they obtained specific tree service jobs or a quantifiable portion of the tree-service market, it failed to carry its burden under Scheidler. This argument is unpersuasive for several reasons. At the outset, Soha and Cain ignore the fact that the indictment charged attempted extortion as well as the substantive crime, and the jury was accordingly instructed as to the elements of attempt liability. The government therefore was not required to establish that David Cain or Jamie Soha in fact obtained any specific property belonging to the extortion victims but merely that they intended to do so and took a substantial step in furtherance of that goal. See United States v. Yousef, 327 F.3d 56, 134 (2d Cir.2003). Construing the evidence in the light most favorable to the government, see United States v. Zhou, 428 F.3d 361, 369-70 (2d Cir.2005), we see ample basis on which the jury could conclude that David Cain, aided and abetted by Jamie Soha, attempted to extort specific tree service and logging work from Kent, Bracey and Gollus. For example, the evidence demonstrated that prior to the January 2001 vandalism incident upon which the first extortion countinvolving Keith Kentwas based, David Cain had established a pattern of making violent threats in order to deter Kent from competing for specific jobs. Kent testified that in 1999 he and Cain had considered collaborating in a logging job on the property of Tanya and Dan Hillman, but Cain ultimately cut him out of the negotiations. When Kent subsequently visited the Hillman property himself, he encountered Cain, who shouted at him in a threatening tone, What the hell are you doing on the property[?] . . . You better get the hell out of here. I'm going to get you. I'm not scared of you. In May 2000 a similar incident occurred when Elizabeth Dietmann hired Kent for a logging job on her property, passing over David Cain, who had also submitted a bid. When Cain discovered that he had not been hired, he irately telephoned Dietmann demanding to know the reason for her decision and who would be doing the work instead. After learning that Kent had underbid him, Cain immediately hung up the phone. Dietmann called Kent to warn him, but the next day, Kent discovered that the tires of his equipment at the Dietmann jobsite had been slashed, a skidder had been tipped over and its instrument panel torn apart, and a bulldozer had been set on a collision course for his house before running out of gas. The same day, Kent's place of business was also vandalized: over forty tires were slashed, three or four engines were overturned and their fuel dumped out and at least two radiators were punctured. The evidence at trial, which included the testimony of many of the individuals who participated in the vandalism, established convincingly that David Cain had ordered the destruction because, as he told one witness, Kent had ripped him off on some logs. The jury could properly infer that the vandalism was intended as an implicit threatGive up the Dietmann job, or this will happen again. Certainly that is how Kent himself understood it. Describing the significance he attached to the vandalism, Kent stated at trial, Well, I think someone was definitely threatening me. The jury could easily have understood the January 4, 2001, vandalism incident that gave rise to the Kent extortion charge as consistent with this history. That day, Jamie Soha and David Cain drove several of their associates to Keith Kent's shop, where those individuals broke in and stole numerous pieces of logging equipment and a truck that was later set on fire. A few years later, Cain confronted Kent while the latter was engaged in a tree service job adjacent to Cain's property. In an apparent reference to the earlier vandalism incidents, Cain said, You motherfucker, I thought I taught you a lesson. I'm going to put you in the fucking hospital. If you know what's good for you you're going to leave here now. Based on this comment and the entire course of Kent's dealings with Cain, the jury could have understood the January 2001 vandalism as an implied threat aimed at coercing Kent into relinquishing his book of business to Cain. The jury was entitled to reach a similar conclusion with regard to the Bracey extortion count. In February 2002, David Cain hired Patrick Ackroyd and Jamie Soha to set fire to Chuck Bracey's tree service business. As Cain explained to Ackroyd, Bracey was competition, and he wanted to get him out of the line. Jeffrey Faso, who shared a cell with David Cain at the Niagara County Jail in 2004 or 2005, testified to a conversation in which David Cain told him that Bracey was one of his competitors in a tree business, and that he was underbidding him, and he started to underbid him more and more on certain jobs. Cain told Faso that he had confronted Bracey on a few different occasions and said that, you know, he didn't appreciate him underbidding him. He was taking his work, and there was a time when he had mentioned . . . about some equipment he had damaged. [3] Based on this testimony and the evidence overall, the jury could infer that the February 2002 vandalism was intended to induce Bracey into relinquishing the jobs on which he had underbid Cain. The most direct evidence that Cain attempted to extort specific assets from his victims came from Dan Gollus, the victim of the March 2003 vandalism that was the basis of the third extortion count. Gollus described the following incident, which occurred sometime in 2002: GOLLUS: He [David Cain] came to me and told me, You know what I'm going to do? he says, I'm going to hit everybody and put them out of business, he says, and then I can demand whatever price I want. THE GOVERNMENT: And you said? GOLLUS: Carefully, Well, you're not going to put me out of business. [. . .] THE GOVERNMENT: Were you afraid of David Cain? GOLLUS: Yes, I was. THE GOVERNMENT: Tell us why? GOLLUS: The things that I had seen and heard and experienced from him, I knew the man meant what he said. That wasn't the end of the conversation. THE GOVERNMENT: Well, take us through the rest of the conversation. GOLLUS: He told me, he says, No, I'm not going toI'm not going to put you out of business. I'm going to buy you out. And then he pointed his finger right at me and he said, What do you want for your business? And it wasn't for sale, but at that point it became for sale. Gollus testified that he initially estimated the value of the business at $300,000 but that he ultimately quoted Cain a price of $125,000. Asked why, Gollus said, After talking with [my girlfriend] and discussing all the facts, we decided it would be best if we could get out for that. We'd just get out. It was either that or perhaps lose it all. The following exchange then occurred: THE GOVERNMENT: Lose it all why, sir, in your mind? GOLLUS: I'd seen other places go up in flames. COUNSEL FOR D. CAIN: Objection, Your Honor. GOLLUS: Literally. THE COURT: Overruled. [. . .] THE GOVERNMENT: What did that do to your state of mind? GOLLUS: I was afraid that too might happen to me. Based on the testimony above and the record as a whole, the jury had an ample evidentiary basis from which to conclude that David Cain, assisted by Jamie Soha and others, engaged in a sustained campaign to intimidate the competitors of David's Tree Service into handing over their businesses to him. As one of Cain's criminal associates describe Cain's approach to Gollus, it was pretty much either buy him out or burn him out, one or the other. Even putting aside the substantial evidence from which the jury could infer that Cain and Soha attempted to extort identifiable, tangible assets from Kent, Bracey and Gollus, the defendants' reliance on Scheidler is misplaced. The government's primary theory at trial was that David Cain threatened and employed force to induce his competitors to abandon their work in order to enlarge his share of the tree service and logging markets. Contrary to the defendants' assertions, this theory of extortion is entirely consistent with the law as articulated by the Supreme Court and this Circuit. In United States v. Tropiano, 418 F.2d 1069 (2d Cir.1969), we held that the right to solicit accounts constituted property within the definition of the Hobbs Act, such that a defendant who owned a trash removal business could be convicted of a substantive violation of the Act for making threats that induced a competitor to stop soliciting business in the area. Although our decision in Tropiano predates Scheidler, it remains good law. In Scheidler, a group of abortion clinics brought a civil RICO action against members of an antiabortion organization, alleging a nationwide conspiracy to shut down clinics through a pattern of racketeering activity that included acts of extortion in violation of the Hobbs Act. The plaintiffs' theory was that because the right to control the use and disposition of an asset is property, [the protesters], who interfered with, and in some instances completely disrupted, the ability of the clinics to function, obtained or attempted to obtain [the clinics'] property. Scheidler, 537 U.S. at 401, 123 S.Ct. 1057. The Supreme Court rejected this argument, reasoning that, while the protestors may have deprived or sought to deprive [the clinics] of their alleged property right of exclusive control of their business assets, they did not acquire that right for their own use. Id. at 405, 123 S.Ct. 1057. It is true that, following Scheidler, in each Hobbs Act case we must now consider an issue that we did not address in Tropiano whether the property that is the subject of the extortion is valuable in the hands of the defendant. Yet this will rarely be a problem in cases such as Tropiano or this one, in which the defendant seeks to exploit the very intangible right that he extracts from the victim. Indeed, Scheidler specifically cited Tropiano as a case whose holding was not implicated by the rule announced by the Supreme Court majority. See Scheidler, 537 U.S. at 402 n. 6, 123 S.Ct. 1057. Our decision in United State v. Gotti subsequently explicated the distinction between the two cases in greater detail: Had the Tropiano defendants sought merely to get Caron to stop soliciting collection accounts because they believed that the Milford area should be entirely free from any solicitation, Tropiano could not stand; like the anti-abortion protestors, the Tropiano defendants would have been seeking simply to deprive someone of a right without doing anything affirmative with that right themselves. But unlike the anti-abortion protestors, the Tropiano defendants did seek to take action with respect to Caron's solicitation rights; they sought to transfer those rights to themselves so that they could continue their own solicitation unimpeded by competition, and thus, in a sense, broaden their own solicitation rights. 459 F.3d 296, 324 (2d Cir.2006). That reasoning is equally applicable here. In contrast to the Scheidler protesters, who had no interest in controlling the clinics' abortion business apart from stopping the clinics themselves from performing abortions, David Cain's purpose in using violence against his victims was to acquire the market share held by Kent, Bracey and Gollus and to exploit it for his own enrichment. Indeed, the record is replete with statements by David Cain establishing that the purpose behind his campaign of vandalism was to induce his competitors to cede their rights to solicit business to him, and thus, in a sense, broaden [Cain's] own solicitation rights. Id. As one criminal associate put it, He basically wanted to put the other tree businesses out of service so he could be number one in Niagara County. Most blatantly, Cain used his reputation for violence and explicit threats to pressure Gollus to sell him his business for far less than Gollus believed it was worth. Those actions, as well as Cain's conduct towards Kent and Bracey, constitute extortion under the Hobbs Act. [4] Finally with regard to these convictions, we reject David Cain's argument, made for the first time in his reply brief, that the consent element of extortion was not proven by sufficient evidence. The Hobbs Act speaks of extortion as the obtaining of property from another, with his consent, induced by wrongful use of actual or threatened force. 18 U.S.C. § 1951(b)(2) (emphasis added). We have previously defined the element of consent as the razor's edge that distinguishes extortion from robbery, which, in contrast, is defined in pertinent part as `the unlawful taking or obtaining of personal property from the person or in the presence of another, against his will, by means of actual or threatened force.' Zhou, 428 F.3d at 371, quoting 18 U.S.C. § 1951(b)(1) (emphasis in Zhou ). We have also acknowledged, however, that [a]t bottom, undeniably, the victim of an extortion acts from fear, whether of violence or exposure. Zhou, 428 F.3d at 371. The essential requirement to establish extortion is thus that the victim retained some degree of choice in whether to comply with the extortionate threat, however much of a Hobson's choice that may be. Id. Cain suggests that because Kent, Bracey and Gollus were incapable of operating their businesses during the period immediately following the vandalism incidents, his conduct cannot be described as obtaining the victims' property with [their] consent. In other words, Cain contends that he was attempting to take his competitors' business from them by making it impossible, as a result of his force and violence, for them to compete, rather than by frightening them into abandoning the field to him. The argument overlooks the fact that the property interest that was the subject of the extortion counts was not the defendants' right to operate during any specific period of time, but rather their right to perform certain work and to solicit business going forward. These rights were not directly infringed by the vandalism, as the victims remained free, once their equipment was repaired, to make good on their contracts and to seek out new ones. Although the cost associated with repairs and the threat of future violence might have been factors that weighed powerfully in the victims' decisions whether to cease their operations altogether or sell them to Cain, that is precisely the type of dilemma that the law of extortion embraces. The evidence was more than sufficient for the jury to conclude beyond a reasonable doubt that Cain's purpose was to frighten his victims into ceding their rights to competeindeed their very businessesto him, and that, by engaging in a campaign of vicious arson and vandalism against them, he had taken substantial steps toward accomplishing that goal. Accordingly, the extortion convictions must be affirmed. [5]