Court Opinion

ID: 9490601
Source: CourtListenerOpinion
Date Created: 2023-08-05 13:48:34.271123+00
Date Added: 2024-06-11T17:54:11.946432
License: Public Domain

MOORE, Circuit Judge,
concurring in part and dissenting in part. I write separately because I view several aspects of this case differently than do my colleagues and because I dissent in part from the majority’s conclusion.
I. HOBBS ACT
I am troubled by Valenzeno’s Hobbs Act conviction. The evidence in this case indicates that Valenzeno engaged in a scheme to defraud his victims by convincing them that the IRS would put them in prison for tax evasion unless they paid a bribe. The government, however, chose to prosecute him for extortion, not fraud. In the end, I agree that Valenzeno “obtain[ed] ... property from another ... by wrongful use of actual ... fear,” as this court has construed this provision: the Sickles were clearly in fear of the claimed prosecution, and Valenzeno used this fear to extract money from them — and that the conviction must therefore stand. See 18 U.S.C. § 1951(b)(2) (defining extortion); United States v. Collins, 78 F.3d 1021, 1030 (6th Cir.1996); United States v. Williams, 952 F.2d 1504, 1513-14 (6th Cir.1991) (“It is enough [to sustain a conviction] if ... fear exists and the defendant intentionally exploits it.”). Cf. United States v. Culbert, 435 U.S. 371, 380, 98 S.Ct. 1112, 1117, 55 L.Ed.2d 349 (1978) (“Our examination of the statutory language and the legislative history of the Hobbs Act impels us to the conclusion that Congress intended to make criminal all conduct within the reach of the statutory language.”).
I am concerned, however, that this construction of the Act gives it a far broader scope than the enacting Congress intended. I see little to distinguish Valenzeno’s scheme from one in which a dishonest auto mechanic extracts money from a customer by fraudulently telling him that without expensive repairs his car will likely fall apart on the highway.1 Both eases are clearly fraudulent, but are they extortionate? Cf. Culbert, 435 U.S. at 378, 98 S.Ct. at 1116 (“As Representative Hobbs noted, the words robbery and extortion ‘have been construed a thousand times by the courts. Everybody knows what they mean.’ ”) (quoting 91 Cong.Rec. 11912 (1945)). It seems unlikely that “everybody” would agree that the crooked mechanic’s behavior constitutes extortion, and Justice Traynor implied in a case similar to the one at bar that even Valenzeno’s scheme would
*372not be extortion unless he had at least implicitly threatened his targets. See People v. Camodeca, 52 Cal.2d 142, 338 P.2d 903, 906-07 (1959). Contra Williams, 952 F.2d at 1513. And, if Valenzeno really had been “helping” the Sickles by bribing an IRS official to halt a prosecution, or if the car really were dangerous and needed repairs (but cheaper ones than the mechanic proposed), would their misconduct be extortion? Again, both situations involve the wrongful2 use of fear to obtain money,3 and would therefore fall within the statutory definition. Cf. James Lindgren, The Elusive Distinction Between Bribery and Extortion: From the Common Law to the Hobbs Act, 35 UCLA L. Rev. 815, 876 (1988) (noting seventeenth-century eases in which private persons were prosecuted for extortion for charging excessive fees). Were I writing on a blank slate I would explore the implications of holding that extortion by “use of fear” requires that the victim fear that the extortionist will take some action if payment is not forthcoming, and that it is not extortion if the victim merely believes that the person requesting payment will refrain from acting if no payment is made. Cf. United States v. Capo, 817 F.2d 947, 954 (2d Cir.1987) (en banc) (holding that “[w]ithout evidence that the payor feared some negative intervention for non-payment, the payment is solely intended to secure an otherwise unsecured result,” and the crime is bribery rather than extortion); George P. Fletcher, Blackmail: The Paradigmatic Crime, 141 U.Pa.L.Rev. 1617, 1621-23 (1993) (discussing possibility of distinguishing between legal offers and illegal threats on basis of relation to “baseline of normalcy,” departures from which could constitute blackmail). Not every snake-oil salesman who preys on our fears of sickness and death is an extortionist. Under this court’s binding precedent in Collins and Williams, however, I agree that the conviction must stand.
II. FAIR CREDIT REPORTING ACT
Valenzeno was also convicted of two counts of violating 15 U.S.C. § 1681q, which provides that “[a]ny person who knowingly and willfully obtains information on a consumer from a consumer reporting agency under false pretenses shall be fined ... or imprisoned.” 15 U.S.C. § 1681q. I agree with the majority that there was no evidence that Valenzeno actually managed to obtain any information about A.J. Rose and that his conviction on Count Six must be vacated. I cannot, however, agree that the government failed to present sufficient proof that Valen-zeno’s obtaining a credit report on Ed Taylor violated § 1681q. The majority seems to base its holding on determinations that (1) there is insufficient evidence that Valenzeno wanted the reports for other than legitimate purposes, (2) Valenzeno never told the credit agency why he wanted Taylor’s report, and (3) Taylor suffered no harm from having his credit report revealed. Under the facts of this ease, the first of these determinations is wrong and the other two are irrelevant.
As the majority notes, the evidence shows, and the jury apparently found, Valenzeno obtained a credit report on Connie and Bernie Sickle in order to determine whether they had access to a line of credit that they could use to obtain money to pay Valenzeno. See J.A. at 232 (Connie Sickle Testimony) (Valenzeno told her to use their credit card to get $3,500.); J.A. at 335-48 (Sickle Credit Reports seized from Valenzeno residence).4 *373The government’s theory as to Count Three was that Valenzeno obtained Taylor’s credit report for exactly the same reason: to determine whether Taylor had access to sufficient funds to make substantial payments in a similar scheme. The evidence of this included a copy of a credit report on Taylor that was found in a file — labeled “Ed Taylor” — in Valenzeno’s home, and testimony as to the details of that seizure. See J.A. at 65-70; J.A. at 298-300 (Credit Report). Several items on the credit report were circled, including Taylor’s credit limit on a credit card. See J.A. at 298. The file also contained what the government fairly characterizes as a script to be used while talking with Taylor, which lists Taylor’s phone number and states, inter alia, “[i]t looks good and I can keep you a free man. All I need is the $2,500 fee and I’ll get started. Since we’ve opened [P]andora’s box we need to get started in a hurry. Get the money to me in 48 hrs.” See J.A. at 297. Accord J.A. at 298 (regarding Taylor’s phone number). A government witness testified that another document read, “[h]i, this is Al, I’ve told the folks that they would be there with your POA in 48 hours. I don’t want these people madder than they are already. So I’ve got to ... have the fee immediately.” J.A. at 66. Because Taylor failed to keep an appointment with Valenzeno, he had no contact with him other than a single phone call from Valen-zeno. See J.A. at 280, 277.
Although the evidence as to why Valenzeno obtained the credit information on Taylor was not as direct as the evidence relating to the Sickles’ credit report, it was nonetheless sufficient to support the inference that Va-lenzeno’s purposes in obtaining credit reports were the same in both cases.5 Both Taylor’s and the Sickles’ credit reports had the credit limit balances highlighted. See J.A. at 146-47, 298. The reference to “opening] Pandora’s box” and needing to “get started in a hurry” suggest that Valenzeno intended to perpetrate the same fraud on Taylor as on the Sickles and the others: legitimate tax preparation services do not usually involve a 48-hour window of opportunity and thousands of dollars in cash prepayment, but Valenzeno’s other frauds did. Finally, if Va-lenzeno had obtained the credit report in order to determine whether to offer credit to Taylor, it is hard to see why after seeing the completely normal report he would then have demanded $2,500 before beginning tax preparation work. See J.A. at 276. That the evidence was circumstantial does not mean that it was insufficient to support the jury’s inference that Valenzeno obtained Taylor’s credit report for improper purposes.
The statute, of course, prohibits obtaining consumer information under false pretenses, not obtaining it for an improper purpose.6 And, the evidence is undisputed that Valen-zeno did not give any reasons for his request at the time he obtained Taylor’s credit report. Under the facts of this case, however, I am nonetheless persuaded that Valenzeno violated the statute.
When Valenzeno opened his account with the credit reporting agency he stated in his application that he needed the reports because he had lost money on account of uncre-*374ditworthy clients in the past and wanted to avoid such losses in the future.7 See J.A. at 151. By telling the credit agency that he would be making future requests for a certain purpose, Valenzeno clearly implied that any future request would be for the specified purpose; in this regard, Professors LaFave and Scott’s discussion of the statutory crime of false pretenses is relevant and persuasive:
A misrepresentation for false pretenses generally requires some affirmative conduct. ... No doubt affirmative statements which reinforce false impressions which the defendant did not create, or affirmative conduct in suppressing the truth — e.g., the defendant actually hides information and so prevents the victim from learning the truth — will do as well. Mere silence, however, will generally not suffice, even though the silent one realizes that the other is acting under a mistaken impression. Under special circumstances there may, nevertheless, he a duty to speak to correct a misapprehension (thus making silence the basis of liability) — as where the defendant has, even though innocently, previously created the misapprehension by something he said or did....
Wayne R. LaFave & Austin W. Soott, Jr., Substantive Criminal Law § 8.7(b)(3) (1986) (emphasis added) (citations omitted). Valen-zeno’s prior dealings with the credit agency created the impression that he would request reports only for certain purposes; his obtaining Taylor’s credit report for other, illicit reasons without disclosing them constituted obtaining the report under false pretenses. This is precisely what the statute prohibits: because part of the Act’s purpose is to protect consumer privacy, § 1681q does not require that the victim suffer economic harm or be the victim of fraud. Cf. 15 U.S.C. § 1681(a)(4) (congressional finding that “[t]here is a need to insure that consumer reporting agencies exercise their grave responsibilities with ... a respect for the consumer’s right to privacy.”); Trans Union Corp. v. Federal Trade Comm’n, 81 F.3d 228, 284 (D.C.Cir.1996) (“[A] major purpose of the Act is the privacy of a consumer’s credit-related data.”). I would uphold the conviction under Count Three, and I respectfully dissent from the majority’s contrary conclusion.

. The government did not indict Valenzeno under the "color of official right” prong of the Hobbs Act, which would also not apply to this hypothetical mechanic. See Joint Appendix (J.A.) at 14 (Indictment). Under that prong, which essentially codifies common-law extortion, the public official’s position of power provides the necessary coercive element and no showing of fear is necessary. See Evans v. United States, 504 U.S. 255, 265-66, 112 S.Ct. 1881, 1887-88, 119 L.Ed.2d 57 (1992). The "force or fear” prong, on the other hand, is more akin to blackmail than to common-law extortion. See Wayne R. LaFave & Austin W. Scott, Jr., Substantive Criminal Law § 8.12 (1986). Cf. Evans, 504 U.S. at 267 n. 18, 112 S.Ct. at 1889 n. 18 (discussing distinction between two prongs of Hobbs Act); James Lind-gren, The Elusive Distinction Between Bribery and Extortion: From the Common Law to the Hobbs Act, 35 UCLA L. Rev. 815 (1988) (cited passim in Evans). At least one court has ignored the distinction between the two prongs and held that bribery and extortion are not mutually exclusive under either prong. See United States v. Lisinski, 728 F.2d 887, 891-92 (7th Cir.) (relying on "color of official right” cases to support conviction under fear prong), cert. denied, 469 U.S. 832, 105 S.Ct. 122, 83 L.Ed.2d 64 (1984). Our circuit, however, has long recognized that bribery and extortion merge only where the extortion is by color of official right, and that solicitation of a bribe will often not constitute extortion by the wrongful use of fear. See Collins, 78 F.3d at 1030; United States v. Harding, 563 F.2d 299, 305 (6th Cir.1977). See generally Lindgren, supra, at 875-82 (discussing application of extortion to private persons at common law).

. The Hobbs Act's use of “wrongful” "limits the statute’s coverage to those instances where the obtaining of the property would itself be ‘wrongful’ because the alleged extortionist has no lawful claim to that property.” United States v. Enmons, 410 U.S. 396, 400, 93 S.Ct. 1007, 1010, 35 L.Ed.2d 379 (1973). Thus, where one uses fear to obtain money to which one has no lawful claim, the use of fear is wrongful.

. Even farther afield, what of a situation in which a person refuses to help another out of a bad situation without a large payment? Does a good Samaritan become an extortionist by demanding payment as a prerequisite to acting, even where there is no duty to act? A similar paradox in the law of blackmail — that it is legal to reveal embarrassing secrets about people and to ask them for money, but not to threaten reveal the secrets unless money is paid — has generated an extensive literature. See generally Symposium, Blackmail, 141 U.Pa.L.Rev. 1565 (1993).

.The prosecution also presented extensive evidence suggesting that Valenzeno had committed similar frauds against Fred Ghadimi, J.A. at 115 (Valenzeno requested $4,000 to bribe IRS officials); Kimberly Meyer, J.A. at 157-59 (Valen-*373zeno requested $2,000 payment within 48 hours); David Nusbaum, J.A. at 171, 173-74 (Valenzeno requested total of $1,400 to go "speak to the people involved to get [Nusbaum] off [an IRS] audit,” but tax problem was never resolved); Richard Reyes, J.A. at 181-82, 184 (Valenzeno told him he needed $6,000 to pay IRS officials to stop investigation); and Raymond Wells, J.A. at 293 (Valenzeno requested $1,800 to pay friend at IRS). The search of Valenzeno’s house uncovered folders on these people, several of which contained “scripts," and credit reports on Reyes and his wife. See J.A. at 59-60, 64, 80, 82, 87. There is no indication that Valenzeno ever actually paid any bribes.

. Because Valenzeno challenges the sufficiency of the evidence, we can overturn his conviction only if no rational juror could have returned a guilty verdict based on this evidence. United States v. Collins, 78 F.3d 1021, 1030 (6th Cir.1996).

. A recent amendment to the Act which is to take effect on September 30, 1997, will impose civil, but not criminal, liability on persons who knowingly obtain information for an improper purpose. See Omnibus Consolidated Appropriations Act [ofi 1997, Pub.L. 104-208 § 2412(c), 110 Stat. 3009^-46, 454 (1996) (amending 15 U.S.C. § 1681n(b) to provide that "[a]ny person who obtains a consumer report from a consumer reporting agency under false pretenses or knowingly without a permissible purpose shall be liable to the consumer reporting agency.”).

. The Fair Credit Reporting Act requires that credit reporting agencies obtain such information from prospective customers. See 15 U.S.C. § 1681e ("Every consumer reporting agency shall maintain reasonable procedures designed to avoid violations of section 1681c of this title and to limit the furnishing of consumer reports to the purposes listed under section 1681b of this title. These procedures shall require that prospective users of the information identify themselves, certify the purposes for which the information is sought, and certify that the information will be used for no other purpose. Every consumer reporting agency shall make a reasonable effort to verify the identity of a new prospective user and the uses certified by such prospective user prior to furnishing such user a consumer report. No consumer reporting agency may furnish a consumer report to any person if it has reasonable grounds for believing that the consumer report will not be used for a purpose listed in section 1681b of this title.”).