Opinion ID: 779927
Heading Depth: 3
Heading Rank: 3

Heading: Lopez category two.

Text: 59 The Government contends that these offenses fall within Lopez category two because, according to the Government, the victim stores were engaged in interstate commerce, relying on United States v. Robertson, 514 U.S. 669, 115 S.Ct. 1732, 131 L.Ed.2d 714 (1995), and that therefore no substantial effect on interstate commerce had to be shown. 60 For several reasons, we reject the Government's contention that these are Lopez category two offenses. To begin with, simply because a business is engaged to any extent in interstate commerce does not alone suffice to bring regulation of any and all conduct involving it within category two. That category applies to instrumentalities of interstate commerce, such as an aircraft or a railroad line, and to persons or things in interstate commerce, such as thefts from interstate shipments. Plainly, a local retail store is not analogous to any of those. 25 The Government's argument would vastly expand Lopez 's category two, extending federal jurisdiction on a per se, categorical basis to a broad range of matters such as shoplifting of a candy bar from any business engaged in interstate commerce or children scuffling in any such business's parking lot, and would also blur the distinction between categories two and three. Moreover, we note the Seventh Circuit's observation, rejecting the Government's attempts to fit a Hobbs Act prosecution into Lopez category two, that [t]he Hobbs Act, however, falls within Lopez category three, at least where the conviction is sought to be sustained simply on the theory that the victim was engaged in interstate commerce. See United States v. Peterson, 236 F.3d 848, 856 (7th Cir.2001). 26 61 Nor do we agree that the Government's argument is supported by Robertson. There the defendant was convicted of various narcotics offenses and of violating 18 U.S.C. § 1962(a) (RICO) by investing the proceeds of those unlawful activities in the `acquisition of any interest in, or the establishment or operation of, any enterprise which is engaged in, or the activities of which affect, interstate or foreign commerce.' Id. at 1732. The Ninth Circuit, in a pre- Lopez decision, affirmed the narcotics convictions but reversed the RICO conviction, holding that the RICO enterprise —an Alaskan gold mine—was not shown to have had more than an incidental effect on interstate commerce and hence did not meet section 1962(a)'s the activities of which affect, interstate ... commerce requirement (without addressing the engaged in ... interstate commerce prong of section 1962(a)). United States v. Robertson, 15 F.3d 862, 868 (9th Cir.1994). The Ninth Circuit did not even mention, let alone discuss, the Commerce Clause or the limits of Congress's power thereunder. The Supreme Court, shortly after Lopez, reversed the Ninth Circuit's reversal of the RICO count, holding there was sufficient evidence that the gold mine was engaged in ... interstate ... commerce for purposes of section 1962(a). Robertson, 115 S.Ct. at 1733. It stated in this connection: 62 ... Robertson, who resided in Arizona, made a cash payment of $125,000 for placer gold mining claims near Fairbanks. He paid approximately $100,000 (in cash) for mining equipment and supplies, some of which were purchased in Los Angeles and transported to Alaska for use in the mine. Robertson also hired and paid the expenses for seven out-of-state employees to travel to Alaska to work in the mine.... He again hired a number of employees from outside Alaska to work in the mine. 63 ... 64 Furthermore, Robertson, the mine's sole proprietor, took $30,000 worth of gold, or 15% of the mine's total output, with him out of the State. 65 Whether or not these activities met (and whether or not, to bring the gold mine within the `affecting commerce' provision of RICO, they would have to meet) the requirement of substantially affecting interstate commerce, they assuredly brought the gold mine within § 1962(a)'s alternative criterion of `any enterprise... engaged in ... interstate or foreign commerce.' Id. 66 Robertson is a statutory construction case and does not purport to make any constitutional holding or to address (or recognize as being potentially before it) any constitutional issue, and it does not mention Lopez or discuss its three categories of Commerce Clause power. 27 67 Finally, and in any event, we reject the underlying premise of the Government's argument in this connection, namely that the victim stores here were engaged in interstate commerce as the Robertson Court understood and intended that phrase. Robertson' s principal illustrations of what is, and what is not, engaged in [interstate] commerce are as follows: 68 the Government proved that some ... [equipment and supplies] were purchased in California and transported to Alaska for use in the mine's operations. Cf. United States v. American Building Maintenance Industries, 422 U.S. 271, 285, 95 S.Ct. 2150, 2159, 45 L.Ed.2d 177 (1975) (allegation that company had made local purchases of equipment and supplies that were merely manufactured out of state was insufficient to show that company was `engaged in commerce' within the meaning of § 7 of the Clayton Act). 69 ... 70 As we said in American Building Maintenance, a corporation is generally `engaged in commerce' when it is itself ` directly engaged in the production, distribution, or acquisition of goods and services in interstate commerce.' Id., at 283, 95 S.Ct., at 2158. 71 In American Building Maintenance the Court held summary judgment was properly granted that the Benton janitorial service companies, located in California, were not engaged in [interstate] commerce, for purposes of section 7 of the Clayton Act, stating: 72 The Benton companies performed a substantial portion [80% to 90%] of their janitorial services for enterprises which were themselves clearly engaged in selling products in interstate and international markets and in providing interstate communication facilities. But simply supplying localized services [in California] to a corporation engaged in interstate commerce does not satisfy the `in commerce' requirement of § 7. To be engaged `in commerce' within the meaning of § 7, a corporation must itself be directly engaged in the production, distribution, or acquisition of goods or services in interstate commerce. 73 ... 74 Similarly, although the Benton companies used janitorial equipment and supplies manufactured in large part outside of California, they did not purchase them directly from suppliers located in other States. [citation] Rather, those products were purchased in intrastate transactions from local distributors.... By the time the Benton companies purchased their janitorial supplies, the flow of commerce had ceased. See Schechter Corp. v. United States, 295 U.S., at 542-543, 55 S.Ct. at 848. Id., 2158-59 (emphasis added; footnote omitted). 75 Here there is no evidence that any of these local retail stores made any sales other than at the store premises in Fort Worth or any sales to any person or entity engaged in interstate commerce, or had any operations, facilities or employees outside of Fort Worth; nor is there any evidence that any of them acquired any of their merchandise inventory other than from instate wholesalers. 28 If the Benton companies were not engaged in interstate commerce, it necessarily follows, a fortiori, that these local retailers were not. 76