The Bleeding Edge of Extortion: How Disregarding the Personal Benefit Poses a Danger in Novel Extortion Cases.

• Author: Haggerty, Thomas M., Jr.

"[W]e reject the contention that a defendant 'obtain[s] ... property' within the meaning of the Hobbs Act extortion provision by 'bring[ing] about [its] transfer ... to another,' ... only if the defendant receives a personal benefit in consequence. In doing so, we align ourselves with the only other circuits to have resolved that same question." (1)

1. INTRODUCTION

   Extortion is one of the oldest crimes that American jurisprudence recognizes. (2) British common law prohibited public officials from utilizing their positions of power to take valuable property from others. (3) American anti-extortion law evolved from these humble common-law origins to meet contemporary societal needs. (4) Naturally, the law experienced growing pains with each new development. (5) The current iteration of American anti-extortion law, the Hobbs Act, is versatile and reaches beyond public corruption. (6) Over the past sixty years, the United States Supreme Court has repeatedly granted certiorari in Hobbs Act cases to more explicitly define what it means to "obtain property" pursuant to its extortion provision. (7) With each new ruling, the federal circuits continue to grapple with the boundaries of the Hobbs Act. (8)

   On March 28, 2019, the First Circuit Court of Appeals reached a ruling that reflects this struggle to define the "obtaining property" element of extortion in novel cases, while creating a new source of anxiety for public officials. (9) After the district court dismissed United States v. Brissette, which involved allegations of extortion against two Boston City Hall aides, the government appealed. (10) In its opinion, the First Circuit held that a party obtains property within the meaning of the Hobbs Act extortion provision when it directs a transfer of property to a third party, even if the transferor does not personally benefit from the transfer. (11) The First Circuit vacated the district court's dismissal and remanded the matter to the district court, where the aides were ultimately convicted by a jury. (12) On February 12, 2020, a district court judge set aside the convictions. (13)

   In its decision, the First Circuit referenced the other circuits that have addressed this issue, all of which have held that directing the transfer of property to a third party constitutes "obtaining property" within the meaning of the Hobbs Act extortion provision, even without a personal benefit to the party directing the transfer. (14) This assessment is warranted, as the Second, Third, Eighth, and Tenth Circuits demonstrated in their respective cases. (15) Analyzing the dramatic expansion of the Hobbs Act over time reveals that this treatment of the "obtaining property" element raises significant concerns, notwithstanding its broad acceptance. (16) The concept of notice is fundamental to the American criminal justice system because ensuring that citizens are aware of prohibited conduct promotes compliance with the law and deters misconduct by law enforcement. (17) Additionally, adequate notice supports a reasonable inference that the alleged criminal actively chose to transgress, making them culpable and thus justifying punishment. (18) In novel or "bleeding edge" extortion cases, an alleged criminal's culpability hinges on contextual factors, thus establishing the importance of notice of wrongfulness. (19) In these cases, examining whether the defendant received a personal benefit can act as a valuable indicator of notice. (20) While proving a personal benefit may seem tedious, expensive, and unnecessary in many extortion cases, especially given the current widespread public distrust of business and political figures, ignoring the personal benefit in novel extortion cases denies the criminal defendant adequate notice of wrongdoing and prevents juries from considering critical context. (21) A modified version of the proposed jury instruction in United States v. Brissette may appropriately balance the pursuit of justice with fair notice. (22)

   This Note explores the history of extortion law in the United States to address the concerns that this trend in circuit court precedent raises. (23) Part II of this Note will briefly summarize the development of English and American common-law extortion, discuss early American legislative efforts to combat extortion, and outline the drafting, enacting, and evolution of the modern Hobbs Act. (24) Part III discusses why the history of extortion law makes establishing culpability especially difficult, why it requires unusually explicit notice of wrongfulness, and why the trend of finding extortion in nonbeneficial third-party transfers of property is incompatible with these concepts, particularly in bleeding edge extortion cases. (25) Part IV concludes that a modified version of the proposed jury instruction in Brissette can help alleviate these concerns. (26)

2. HISTORY

   1. Common-Law Extortion

      By the Middle Ages, English society recognized public corruption as a pervasive problem, especially in the "administration of justice." (27) The Magna Carta reflected this concern, specifically acknowledging that the right to justice should not be sold. (28) In 1274 and 1275, King Edward I initiated royal inquests into corruption, which generated reports called "The Hundred Rolls." (29) The term "extortion" originates from the questions that inquisitors asked, called the Articles of Inquest. (30) The Hundred Rolls revealed that official misconduct was deeply rooted in English society. (31)

      In response to the Hundred Rolls, the English parliament adopted the First Statute of Westminster in 1275. (32) The statute was broadly defined. (33) Thanks to its wide reach, extortion law became the English government's favored weapon against all manners of public corruption, including coercion, bribery, and fraud. (34) As early as the eighteenth century, the English government had explicitly categorized three chapters of the First Statute of Westminster as extortion statutes in the Statutes at Large, a compilation of governing law. (35) The most "famous" of the three, chapter twenty-six, stated the common law of extortion. (36) The majority of chapter twenty-six was still in effect when the United States Congress enacted the Hobbs Act. (37)

      Initially, "[e]xtortion retained its primary common law meaning in America--a public official taking or receiving unwarranted payments." (38) Accordingly, several colonies and states enacted "fee statutes," which established fees that public officials could fairly charge for services. (39) In some fee statutes, such as North Carolina's, the preamble specifically stated that they were designed to prevent extortion. (40)

   2. Prosecuting Extortion Through the Sherman Antitrust Act and Anti Racketeering Act

      The United States Congress first attempted to combat racketeering and extortion on the federal level by utilizing the Sherman Antitrust Act (Sherman Act), which the Senate enacted "to prevent and punish capitalistic combinations and monopolies." (41) In practice, the statutory purpose, together with judicial rulings that further restricted the Sherman Act's reach, made it a weak tool for prosecuting extortion. (42) Additionally, convictions under the Sherman Act imposed inadequate penalties. (43)

      In response to these perceived inadequacies, a subcommittee of the Senate Committee on Interstate Commerce, the Copeland Committee, conducted extensive research into U.S. racketeering. (44) The Copeland Committee ultimately proposed thirteen bills intended to combat corruption. (45) The Senate passed one of the bills, S. 2248, without debate, but the bill faced immediate criticism from the American Federation of Labor (Federation) for its broad restrictions. (46) Most notably, the Federation contested S. 2248 out of fear that it would restrict legitimate organized labor functions. (47) The Department of Justice ultimately revised S. 2248 to include an exemption for payments from a bona fide employer to their employee and protections for organized labor. (48) Congress ratified S. 2248, which became known as the Anti-Racketeering Act of 1934, without debate. (49)

   3. United States v. Local 807 of International Brotherhood of Teamsters

      In 1942, the Supreme Court considered the matter of United States v. Local 807 of International Brotherhood of Teamsters. (50) At the time, most New York City truck drivers were members of the Local 807 International Brotherhood of Teamsters Union (Teamsters). (51) Prior to the alleged racketeering acts, truck drivers from outside of New York would deliver goods to customers in New York and obtain goods for delivery to other states. (52) The Supreme Court noted that "[t]here was sufficient evidence to warrant a finding that the defendants conspired to use and did use violence and threats to obtain ... the regular union rates for a day's work of driving and unloading" from the out-of-state truck drivers. (53) Ultimately, the Teamsters compelled many of the out-of-state truck drivers to enter into contracts that required them to pay the Teamsters for the right to deliver goods within the city. (54)

      The government charged the Teamsters with multiple counts of conspiracy to violate the Anti-Racketeering Act. (55) The Supreme Court granted certiorari to consider the scope of the exceptions that Congress built into the Anti- Racketeering Act at the request of the Federation. (56) The Court recognized three potential interpretations of the exception and analyzed the legislative history of the Anti-Racketeering Act to determine which interpretation controlled. (57) The Court concluded that Congress intended the Anti-Racketeering Act to differentiate "militant labor activity" from organized crime, and therefore the bona fide employee exception did not only apply to individuals who were employees at the time they sought to obtain money, but applied to outsiders who attempted to gain employee status as well. (58) As a result, the exception protected individuals like...