Court Opinion

ID: 9842995
Source: CourtListenerOpinion
Date Created: 2023-09-24 02:23:46.542641+00
Date Added: 2024-06-11T09:14:24.048601
License: Public Domain

PRATT, Circuit Judge,
dissenting in part:
While I agree with my colleagues with respect to the obstruction of justice, witness intimidation, and false statement convictions, I must respectfully dissent with respect to the convictions under the Hobbs Act for extortion and conspiracy to extort. Under the law as charged to the jury, there was insufficient evidence to support the extortion convictions, but by extending the federal crime of extortion beyond any prior limits the majority concludes that these convictions should be affirmed.
Although fear of economic loss is an accepted ground for an extortion conviction, see United States v. Brecht, 540 F.2d 45, 52 (2d Cir.1976), cert. denied, 429 U.S. 1123, 97 S.Ct. 1160, 51 L.Ed.2d 573 (1977), overruled on other grounds, Perrin v. United States, 444 U.S. 37, 100 S.Ct. 311, 62 L.Ed.2d 199 (1979), it has, until now, been limited to circumstances in which economic fear results from either threatened loss of an existing economic benefit, see, e.g., United States v. Margiotta, 688 F.2d 108, 133 (2d Cir.1982), cert. denied, 461 U.S. 913, 103 S.Ct. 1891, 77 L.Ed.2d 282 (1983), or threatened preclusion from a potential economic benefit, see, e.g., United States v. Hathaway, 534 F.2d 386, 395 (1st Cir.), cert. denied, 429 U.S. 819, 97 S.Ct. 64, 50 L.Ed.2d 79 (1976). Here, however, the concept of fear of economic loss has been further stretched to embrace the loss of a potential economic benefit for which the “victims” had no existing claim, and from which they had not been precluded. In effect, the majority, while recognizing there are “no prior applications of the Hobbs Act to a job-selling scheme such as this one”, is nevertheless extending the Hobbs Act to include influence peddling and commercial bribery.
A. Insufficiency of Evidence
In charging the jury on the meaning of “fear” with respect to the extortion counts, Judge Telesca explained:
The term fear does not necessarily refer to physical fear or fear of violence. For the purposes of this statute, it means the fear of economic loss, which may include a fear of economic disadvantage and fear of lost economic opportunity. In addition, the anticipation of economic loss would also constitute fear within the meaning of this statute.
It is not necessary that the Government prove that the fear of economic loss was the consequence of a direct threat made by the defendant. Nor is it necessary for the Government to prove that the defendant actually created the fear in the minds of his victims, or was responsible for creating that fear. However, it must be proved that the defendant intended to exploit the fear of the alleged victim. The fear of economic loss must be a reasonable one. The mere voluntary payment of money or delivery of property, unaccompanied by any fear of economic loss, would not constitute extortion.
In other words, if you find that any defendant asked for the payment of money as a pre-condition to his using his influence with officials at Kodak to obtain a job for someone, that alone is not extortion.
To find the defendant guilty of extortion, you must also find that the victim reasonably believed that the defendant *1072had the power and influence with officials at Kodak to hurt the victim’s prospects of obtaining employment at Kodak, even if that fear was not caused by a direct threat by the defendant, and that the victim was in fear of not obtaining a job, or of seriously reducing his chances of obtaining a job, unless he gave money to the defendant.
(Emphasis added.) This charge, which required the jury to find that a “victim” reasonably feared that defendants would negatively affect his employment prospects if he did not pay, was, at least prior to the majority opinion in this case, a proper distillation of the law of extortion by wrongful use of fear. The only question that properly should be before us on the extortion counts, therefore, is whether there was sufficient evidence to uphold the jury’s verdict under this charge. There was not.
Even drawing every inference in favor of the government, there is nothing to indicate that the victims reasonably believed that the defendants had the power and influence with officials at Kodak “to hurt” their prospects of obtaining employment at Kodak. First, there was no evidence that any of the defendants had any negative effect on any particular job application. Second, the evidence establishes that there was no “fear” of any kind on the part of those seeking jobs at Kodak; on the contrary, these “victims” gladly paid defendants, not to neutralize any negative impact defendants might have on their job prospects, but to gain an advantage over other job applicants. Third, there was no evidence that any fear of defendants’ interference, even if it existed in one or more of the “victims”, would have been reasonable in the circumstances, especially since the normal hiring channels at Kodak remained open and unaffected by defendants’ activities. Last, there was no evidence that defendants intended to exploit any threat of being able to preclude the “victims” from employment at Kodak. Indeed, the government conceded at oral argument that there was no evidence that Kodak’s normal hiring process was slowed to exploit the system and increase the number of payments received by defendants. In short, by paying defendants, the “victims” sought to realize economic opportunities to which they had no greater entitlement than those who were proceeding through normal application channels.
The majority suggests and the evidence establishes that defendants, in essence, told those seeking jobs “[y]ou can get a job at Kodak if you pay for it”; without anything more, however, the majority concludes that the jury could also find the job seekers reasonably feared that they would not get jobs at Kodak without paying defendants. Because there is nothing to indicate that defendants would or could intervene to impair the prospects of employment through normal channels of someone who did not pay, this negative inference has no basis in the record. The majority supports its conclusion with a statement by one of the “victims” that when he asked Walter Snacki why it would cost his wife $500 for a job, Walter answered, “You want her to get a job, don’t you”. This statement, however, is as neutral on the critical “fear” component of extortion as the majority’s other, even less availing, examples; it cannot reasonably support an inference that defendants would hinder the “victims” in their efforts to be hired at Kodak if they did not pay. All it establishes, if believed, is that without payment defendants would not exercise their influence to affirmatively help the job seekers.
Significantly, as the main opinion acknowledges, most of the “victims” had previously been unsuccessful in their own efforts to be hired at Kodak. What they were paying for, then, was defendants’ influence at Kodak to help them get what they had not been able to get on their own. In short, what happened here is no more than what Judge Telesca expressly charged the jury did not constitute extortion; namely, “if you find that any defendant asked for the payment of money as a precondition to his using his influence with officials at Kodak to obtain a job for someone, that alone is not extortion.”
*1073B. Stretching the Law of Extortion
In essence, the payments to defendants here were bribes meant to secure defendants’ use of their influence to the advantage of the payer. Although bribery and extortion are not necessarily mutually exclusive, Hathaway, 534 F.2d at 395, this court has previously distinguished commercial bribery from extortion, noting: “The difference between the commercial bribe taking charge and the unlawful activity of extortion is that only the latter involves initiative on the part of the defendant and coercion on the part of the victim”, Brecht, 540 F.2d at 51. Recognizing that the line between bribery and extortion is thin, we have established the distinction that “if the defendant purports to have the power to hurt the victim in economic terms and fear is induced, the solicitation becomes an extortionate demand.” Id. at 51 n.ll (emphasis added). By defining fear of economic loss to include “the fear that a job opportunity would be lost” when defendants did not purport to have the power to hurt— only the power to help — these “victims”, the majority has subjected the nebulous activity of influence peddling, here carried out through the state crime of commercial bribery, to punishment through the federal crime of extortion.
The majority’s eradication of the distinction between these crimes removes the negative element of extortion, that is, “pay me or be precluded”, draws mere influence peddling within the grasp of extortion, and does so without even requiring that the means for exerting that influence be criminal under either federal or state law. Suddenly, practitioners of a number of otherwise legal occupations must fear the prospect of federal prosecution for extortion. Lawyers specializing in expediting matters before government agencies, legislative lobbyists, and even commercial brokers daily exploit the “fear” of loss of a potential economic benefit by selling their purported abilities to improve their clients’ chances of getting what they want, even though the clients are not precluded from seeking the same result themselves or through other channels.
Worse yet, since the majority’s references to fear are so broad and ambiguous, it is not clear what, if any, limits on the crime of extortion by wrongful use of fear of economic harm still remain. For instance, the level of economic opportunity contemplated is low. The majority “conclude[s] that the fear that a job opportunity would be lost is the type of fear whose extortionate exploitation is within the reach of the Hobbs Act” (emphasis added). However, the “opportunity” feared lost here was a job which most of the “victims” had failed to obtain through their own efforts. Yet the majority holds that fear of losing even this last-chance opportunity, to be realized through commercial bribery, is sufficient to qualify under the Hobbs Act. Apparently, what may constitute an “opportunity” whose loss is feared is, under the majority’s test, virtually limitless in scope.
Moreover, the main opinion suggests at one point that “[t]o establish extortion, the government must prove that the victim had a reasonable fear that the defendant had an intent to exploit”, and later concludes that “[i]t sufficed if those seeking jobs * * had a ‘reasonable fear that the defendants possess [the power to control hiring] and would use it if their demands were not met.’ ” (quoting United States v. Rastelli, 551 F.2d 902, 905 (2d Cir.), cert. denied, 434 U.S. 831, 98 S.Ct. 115, 54 L.Ed.2d 91 (1977)). The former formulation of criminal extortion describes no more than the concern that keeps employment agencies in business. While the latter formulation correctly adds the further requirement that defendants would preclude the “victims” if they did not pay, there is no evidence in this case to satisfy that requirement.
In sum, I dissent because the majority has gone beyond the law of the case actually submitted to the jury and in extending that law has taken one more step down the road toward complete federalization of state criminal law. I would vacate the extortion and conspiracy to extort convictions and dismiss those counts of the indictment for failure of proof, leaving intact the *1074convictions for obstruction of justice, witness intimidation, and false statements to a government agency.,