Hobbs Act – 3-prong checklist

Hobbs Act—Extortion By Force, Violence, or Fear

In order to prove a violation of Hobbs Act extortion by the wrongful use of actual or threatened force, violence, or fear, the following questions must be answered affirmatively:

 

  1. Did the defendant induce or attempt to induce the victim to give up property or property rights? 

    “Property” has been held to be “any valuable right considered as a source of wealth.” United States v. Tropiano, 418 F.2d 1069, 1075 (2d Cir. 1969) (the right to solicit garbage collection customers). “Property” includes the right of commercial victims to conduct their businesses. See United States v. Zemek, 634 F.3d 1159, 1174 (9th Cir. 1980) (the right to make business decisions and to solicit business free from wrongful coercion) and cited cases). It also includes the statutory right of union members to democratically participate in union affairs. See United States v. Debs, 949 F.2d 199, 201 (6th Cir. 1991) (the right to support candidates for union office); United States v. Teamsters Local 560, 550 F. Supp. 511, 513-14 (D.N.J. 1982), aff’d, 780 F.2d 267 (3rd Cir. 1985) (rights guaranteed union members by the Labor-Management Reporting and Disclosure Act, 29 U.S.C. §  411). 

  2. Did the defendant use or attempt to use the victim’s reasonable fear of physical injury or economic harm in order to induce the victim’s consent to give up property? 

    A defendant need not create the fear of injury or harm which he exploits to induce the victim to give up property. See United States v. Duhon, 565 F.2d 345, 349 and 351 (5th Cir. 1978) (offer by employer to pay union official for labor peace held to be “simply planning for inevitable demand for money” by the union official under the circumstances); United States v. Gigante, 39 F.3d 42, 49 (2d Cir. 1994), vacated on other grounds and superseded in part on denial of reh’g, 94 F.3d 53 (2d Cir. 1996) (causing some businesses to refuse operations with the victim sufficiently induced the victim’s consent to give up property, consisting of a right to contract freely with other businesses, as long as there were other businesses beyond defendants’ control with whom the victim could do business). 

    Moreover, attempted extortion may include an attempt to instill fear in a federal agent conducting a covert investigation or a defendant “made of unusually stern stuff.” See United States v. Gambino, 566 F.2d 414, 419 (2d Cir. 1977) (argument that FBI agent pretending to be extortion victim could not be placed in fear is not a defense to attempted extortion of the agent); see also United States v. Ward, 914 F.2d 1340, 1347 (9th Cir. 1990) (an attempt to instill fear included a demand for money from a victim who knew that the defendant was only pretending to be a federal undercover agent when he threatened the victim with prosecution unless money was paid). 

    However, the payment of money in response to a commercial bribe solicitation, that is, under circumstances where the defendant does not threaten the victim with economic harm, but only offers economic assistance in return for payment to which the defendant is not entitled, is not sufficient to prove extortion by fear of economic loss. United States v. Capo, 817 F.2d 947, 951-52 (2d Cir. 1987) (solicitation of money from job applicants by persons having no decisionmaking authority in return for favorable influence with employment counselors was insufficient evidence of inducement by fear); but see United States v. Blanton, 793 F.2d 1553, 1558 (11th Cir. 1986) (inducement by fear was proven by the defendant’s solicitation of a labor consulting contract, to help employer stop outside union organizing, when the solicitation was accompanied by defendant’s threat to form another union and begin organizing employees if the consulting contract was not accepted). 

  3. Did the defendant’s conduct actually or potentially obstruct, delay, or affect interstate or foreign commerce in any (realistic) way or degree? 

    The Hobbs Act regulates extortion and robbery, which Congress has determined have a substantial effect on interstate and foreign commerce by reason of their repetition and aggregate effect on the economy. Therefore, the proscribed offenses fall within the category of crimes based on the Commerce Clause whose “de minimis character of individual instances arising under [the] statute is of no consequence.” United States v. Bolton, 68 F.3d 396, 399 (10th Cir. 1995) (upholding Hobbs Act convictions for robberies whose proceeds the defendant would have used to purchase products in interstate commerce), quoting, United States v. Lopez, — U.S. —, 115 S.Ct. 1624, 1630 (1995); material in brackets added; see also United States v. Atcheson, 94 F.3d 1237, 1243 (9th Cir. 1996) (robbery of out-of-state credit and ATM cards); United States v. Farmer, 73 F.3d 836, 843 (8th Cir. 1996) (robbery of commercial business); United States v. Stillo, 57 F.3d 553, 558 n.2 (7th Cir. 1995). 

    Hobbs Act violations may be supported by proof of a direct effect on the channels or instrumentalities of interstate or foreign commerce, as for example, where the threatened conduct would result in the interruption of the interstate movement of goods or labor. See United States v. Taylor, 92 F.3d 1313, 1333 (2d Cir. 1996) (extortion of money, unwanted labor, and subcontracts on construction projects by threatened shutdowns and labor unrest); United States v. Hanigan, 681 F.2d 1127, 1130-31 (9th Cir. 1982) (robbery of three undocumented alien farm workers while they were traveling from Mexico to the United States in search of work); United States v. Capo, 791 F.2d 1054, 1067-68 (2d Cir. 1986), vacated on other grounds, 817 F.2d 947 (2d Cir. 1987) (scheme to extort local job applicants had a potential effect on interstate applicants who might otherwise be hired). 

    Indirect effects on such commerce are also sufficient, as for example, where the obtaining of property and resulting depletion of the victim’s assets decreases the victim’s ability to make future expenditures for items in interstate commerce.Taylor, supra (depletion of contractors’ assets). However, the Seventh Circuit has distinguished Hobbs Act cases involving depletion of a business’ assets from those involving the depletion of an individual employee’s assets which, the court has ruled, are not as likely to satisfy the jurisdictional requirement of the Hobbs Act. United States v. Mattson, 671 F.2d 1020 (7th Cir. 1982); United States v. Boulahanis, 677 F.2d 586, 590 (7th Cir. 1982). Other circuits have agreed where the extortion or robbery of an individual has only an “attenuated” or “speculative” effect on some entity or group of individuals engaged in interstate commerce thereby diminishing the “realistic probability” that such commerce will be affected. See United States v. Collins, 40 F.3d 95, 100 (5th Cir. 1994) (conviction for robbery of a computer company employee reversed on grounds that theft of victim’s automobile with cellular phone had an insufficient effect on his employer’s business); United States v. Quigley, 53 F.3d 909 (8th Cir. 1995) (upholding the acquittal, following guilty verdict, of defendants w

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