# Record and brief — Jannotti v. United States > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385008_1572%3A0 ## Record - **Collection:** Supreme Court brief - **Document type:** Record and brief - **Published:** January 1, 1982 - **Citation:** 457 U.S. 1106 ## Text ion Petit ee ee ee ee ee ee ‘ 81-1899 ¥ rye ur Os APR 12 No. _ Besa ends Supreme Court of the United States October Term, 1981 HARRY P. JANNOTTI, Petitioner 0. UNITED STATES OF AMERICA, Respondent GEORGE X. SCHWARTZ, Petitioner v. UNITED STATES OF AMERICA, Respondent PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT . CLayton UNpercor.er, III Of Counsel: OBERT N. pe Luca Di_wortn, Paxson, KALISH 2600 The Fidelity Building & KAUFFMAN Philadelphia, Pennsylvania 19109 Carot A. MEEHAN (215) 875-7000 2600 The Fidelity Building Attorneys for Petitioner Philadelphia, Pennsylvania 19109 Harry P. Jannotti Ricuarp A. SPRAGUE Epwarp H. RusBENsTONE Suite 400, Wellington Building Of Counsel: 135 S. 19th Street SPRAGUE & RUBENSTONE a 19103 Suite 400, Wellington Building 1- 135 S. 19th Street Attorneys for Petitioner Philadelphia, Pennsylvania 19103 George X. Schwartz International Printing Co., 711 So. SOth St. Phila., Pa. 19143 — Tel. (215) 727-8711 QUESTIONS PRESENTED 1. Whether the government's conduct of the ABSCAM operation violated the most basic standards of due process and fundamental fairness, reaching and exceeding that degree of outrageousness which mandates dismissal of this prosecution? 2. Whether, where the evidence of governmental in- ducement is overwhelming, the government can meet its burden to disprove entrapment when the only proof of predisposition offered is the fact that the defendant com- mitted the criminal act, which proof demonstrates neither his pre-existing criminal inclination nor familiarity with criminal techniques and procedures, and was manufac- tured, in its entirety, by the government? 3. Whether, given the constitutional limitations in- herent in Congress’ power to legislate under the commerce clause, federal jurisdiction under the Hobbs Act can be predicated upon wholly fictitious facts and circumstances which could never have had, at any time, any actual or _ potential effect on interstate commerce and which “facts,” in any event, were formulated and injected into the trans- action in question by the government? 4. Whether, under the Hobbs Act, criminal convic- tions for extortion can be sustained absent proof of “inducement” by the defendants charged? (i) TABLE OF CONTENTS Page GemmNNNS TUMMIITED onc cesses scccccccccsccssccccvccces i TAGE GP AMUBTBTTED oo0o sc ccccccscccccccccccccscccosecs iii SN BT ccc ccccccdcccceccctssendscccceseceses III cin nc'nnd6060eecbes6oedectseacascenesbesecste CONSTITUTIONAL AND STATUTORY PROvISIONS INVOLVED ...... STATEMENT OF THE CAGE 2... cece ccccccccccccccscccccess REASONS FOR GRANTING THE WRIT .......-..-00000eeee eee 10 The Government’s Conduct of ABSCAM Violated the Most Basic Standards of Due Process and Funda- mental Fairness, Reaching and Exceeding That Degree of Outrageousness Which Mandates Dis- mafesal of Tiles Prosecution ........ccccceccsccees 10 Where the Evidence of Governmental Inducement Is Overwhelming, the Government May Not Rely Upon Evidence of “Ready Acquiescence” Manufactured by It to Meet Its Burden, Nor Can a Court Sustain a Conviction in an Entrapment Case on Proof of Com- mission of the Criminal Act Alone ............... 17 The Third Circuit's Ruling on Hobbs Act Jurisdiction in This Case Conflicts With the Rulings of Three Courts of Appeals, Impacts on All Federal Criminal Legis- lation Enacted Under the Commerce Clause, Misap- plies Prior Holdings of This Court, and Is Erroneous Under the Facts of This Case ................... 20 A Conviction for Extortion Under the Hobbs Act Absent Proof of Inducement by a Defendant Should Not Be Permitted, and Clarification of This Issue Is ET bWhddddh00660 sens ccasdudacbesenceseses 26 TABLE OF AUTHORITIES Cases: Page Casey v. United States, 276 U. S. 413 (1928) .............. ll Greene v. United States, 454 F. 2d 783 (9th Cir. 1971) ..... 11,13 Hampton v. United States, 425 U. S. 484 (1976) ........... ll Olmstead v. United States, 277 U. S. 438 (1928) ............ ll People v. Dioguardi, 8 N. Y. 2d 260, 203 N. Y. S. 2d 870, 168 Se OE gow ncccdusdsyucedcansseueccess 27 Perez v. United States, 402 U. S. 146 (1971) .............. 20, 21 Sherman v. United States, 356 U. S. 369 (1958) ............ ll Sorrells v. United States, 287 U. S. 435 (1932) ............ 11,17 United States v. Adcock, 558 F’. 2d 397 (8th Cir.), cert. es GO Oe Oe CD oi cnccckensasbesucvtacee 27 United States v. Addonizio, 451 F. 2d 49 (3d Cir.), cert. Gee, GES TH, BH GE CIGD acc cccccccccsciccscccccs 27 United States v. Archer, 486 F. 2d 670 (2d Cir. 1973) ....11, 15, 24 United States v. Bocra, 623 F. 2d 281 (3rd Cir.), cert. denied, i oo ce sence ceeeueseseenadseccee ll United States v. Cerilli, 603 F. 2d 415 (3d Cir. 1979), cert. denied, 444 U. S. 1043 (1980) .............. ccc eee 22 United States v. Duhon, 565 F. 2d 345 (5th Cir. ), cert. denied, ee ee PE acd coe weaver ecabesucsusacass 28 United States v. Feola, 420 U. S. 671 (1975) ..... 20, 22, 23, 24, 25 United States v. French, 628 F. 2d 1069 (8th Cir.), cert. denied, 101 S. Ct. 364 (1980) ..............cceeeeee. 26 United States v. Gerald, 624 F. 2d 1291 (5th Cir. 1980) ..... 28 United States v. Hathaway, 534 F. 2d 386 (lst Cir.), cert. denied, 499 U. S. 810 (1976) .........ccccccccccccecs 27 United States v. Hedman, 630 F. 2d 1184 (7th Cir. 1980), cert. denied, 450 U. S. 965 (1981) ................05. 27 United States v. Hyde, 448 F. 2d 815 (5th Cir. 1971), cert. denied, 404 U. S. 1058 (1972) ......... cece cece eeees 27, 28 United States v. Johnson, 565 F. 2d 179 (1st Cir. 1977), cert. Gre, GEG GG. BN CEG ones ccc ccvccccssccccces ll (ii) TABLE OF AUTHORITIES (Continued) Cases (Continued): Page United States v. Leja, 563 F. 2d 244 (6th Cir. 1977), cert. denied, 434 U. S. 1074 (1978) ........ccccccccevcees ll United States v. Phillips, 577 F. 2d 495 (9th Cir.), cert. I, Ge Ge Gs Ge CPU occ cvccccvcsccsccesceces 21 United States v. Prairie, 572 F. 2d 1316 (9th Cir. 1978) ..... Il United States v. Reifsteck, 535 F. 2d 1030 (8th Cir. 1976) ... 11 United States v. Rindone, 63] F. 2d 491 (7th Cir. 1980) .... 21 United States v. Russell, 459 F. 2d 671 (9th Cir. 1972), rev'd i oD cieenesescendeccesennvesdsvecss ll United States v. Spagnolo, 546 F. 2d 1117 (4th Cir. 1976) (per curiam ), cert. denied, 433 U. S. 909 (1977) ....... 21, 22 United States v. Staszcuk, 517 F. 2d 53 (7th Cir.) (en banc), cert. denied, 423 U. S. 837 (1975) .............. 21, 22, 25, 27 United States v. Twigg, 588 F. 2d 373 (3d Cir. 1978) ...... ll United States v. Watson, 489 F. 2d 504 (3d Cir. 1973) ..... 17 United States v. West, 511 F. 2d 1083 (3d Cir. 1975) ...... ll Williamson v. United States, 311 F. 2d 441 (5th Cir. 1962), on appeal after remand, 340 F. 2d 612 (5th Cir.), cert. I, Ge We CED occ ccdccccveccaseveciee 12 Constitution and Statutes: United States Constitution, Amendment V ............ i, 2, 20, 25 United States Code, Title 18: Re a ee 22 18 U. S. C. § 1951 (The “Hobbs Act”) ..... 2, 3, 8, 9, 20 et seq. Be ae ee EE ED | Se cidecodccciccceod’ 3, 8,9, 14 ee eg Cs eke ied wabawues 3,15 ae SED Uceuiod 60 G5beendu64 se eneoneuew 4 United States Code, Title 25: a i ci aven eens bees eceseeeosuées st 2 (iv) No. IN THE Supreme Court of the United States Ocroser TERM, 1981 HARRY P. JANNOTTI, Petitioner v. UNITED STATES OF AMERICA, Respondent GEORGE X. SCHWARTZ, Petitioner 0. UNITED STATES OF AMERICA, Respondent PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT Petitioners above named respectfully pray that a writ of certiorari issue to review the judgment and opinion of the United States Court of Appeals for the Third Circuit, sitting in banc, entered in this case on February 11, 1982. (1) 2 Petition for a Writ of Certiorari OPINIONS BELOW The opinion of the United States Court of Appeals for the Third Circuit, sitting in banc, reversing the opinion of the United States District Court, is not yet reported. A copy of this opinion is printed in the Appendix at A. 1. The opinion of the United States District Court for the Eastern District of Pennsylvania, which was reversed by the appellate court, is reported at 501 F. Supp. 1182 (E. D. Pa. 1980). A copy of this opinion is printed in the Appendix at A. 129. The opinion of the United States District Court for the Eastern District of Pennsylvania, dismissing the sub- stantive Hobbs Act charges, is not reported. A copy of this opinion is printed in the Appendix at A. 107. JURISDICTION The judgment of the United States Court of Appeals for the Third Circuit, reprinted in the Appendix, at A. 181, was entered on February 11, 1982. This Court’s jurisdic- tion is invoked under 28 U. S. C. § 1254(1). CONSTITUTIONAL AND STATUTORY PROVISIONS INVOLVED United States Constitution: Amendment V: No person shall . . . be deprived of life, liberty, or property without due process of law; . . . United States Code, Title 18: § 1951. Interference with commerce by threats or violence (the “Hobbs Act” ) Petition for a Writ of Certiorari 3 (a) Whoever in any way or degree obstructs, delays, or affects commerce or the movement of any article or commodity in commerce, by robbery or extortion or attempts or conspires so to do . . . shall be fined not more than $10,000 or imprisoned not more than twenty years, or both. (b) As used in this section— °° ° ° (2) The term “extortion” means the obtaining of property from another, with his consent, induced by wrongful use of actual or threatened force, violence, or fear, or under color of official right. (3) The term “commerce” means commerce within the District of Columbia, or any Territory or Possession of the United States; all commerce between any point in a State, Territory, Posses- sion, or the District of Columbia and any point outside thereof; all commerce between points within che same State through any place outside such State; and all other commerce over which the United States has jurisdiction. § 1962. Prohibited activities (Racketeer Influenced and Corrupt Organizations Act: “RICO” ) (c) It shall be unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indi- rectly, in the conduct of such enterprise’s affairs through a pattern of racketeering activity or collection of unlawful debt. 4 Petition for a Writ of Certiorari (d) It shall be unlawful for any person to conspire to violate any of the provisions of subsection (a), (b), or (c) of this section. STATEMENT OF THE CASE ABSCAM was conceived in 1978 by F. B. I. agents in New York along with a career swindler and convicted felon, Melvin Weinberg. Originally, ABSCAM was de- signed to recover stolen property, but it evolved into a government-backed endeavor to bribe public officials, thus changing the government's role from that of a tradi- tionally passive buyer of stolen property to an aggressive instigator, seeking out officials and offering bribes to them. ABSCAM was characterized throughout by clever strategies and substantial inducements—the “honeypot” according to Weinberg—designed to attract potential tar- gets of the scheme. Substantial legal fees, lucrative in- vestment opportunities, and large amounts of money were offered to the victims of the scheme, and the impression of an Arab sheik with vast amounts of money to spend freely was continually fostered by tie FY. B. I. Likewise, the F. B. I. agents repeatedly and effectively employed the concept of “the Arab mind” or “the Arab way of doing business” ' to persuade their victims that they must accept the money offered to them to convince the fictitious sheik of their friendship. The government also recruited and used “middle- men” to assist in the scheme, among them Howard Criden, a Philadelphia lawyer who brought both petitioners Schwartz and Jannotti into the ABSCAM net. Criden, as were various other middlemen, was compensated by 1. See the District Court’s discussion of the “Arab mind” tech- nique and the manner in which it was employed, at A. 151-152. Petition for a Writ of Certiorari 5 contingent fee based upon the number of officials he could produce for the government. He also received continu- ing promises of substantial, future legal fees and other lucrative investment opportunities. Criden was taught early in ABSCAM by Weinberg and another middleman, Mayor Angelo Errichetti of Cam- den, New Jersey, that the officials who were brought in to meet the sheik and his “associates’"—the F. B. I. agents— need only come on strong, emphasize their importance, and that no official would be called upon to pertorm. A. 152-153. Criden also intentionally deceived the F. B. I. by having an associate in his law firm impersonate an immigration officer to obtain a $50,000 fee. The ruse did not work and the F. B. I. learned of the deception. Never- theless, the F. B. I. continued to utilize Criden and to accept without question his representations regarding the honesty and reputations of public officials who were the ultimate victims of ABSCAM. The Philadelphia aspect of ABSCAM was authorized by the F. B. I. only for a ten-day period, was the last major operation conducted by the ABSCAM operatives, and was designed to test the integrity of city officials.* No infiltra- tion or discovery of ongoing criminal activity took place or was intended by the government. Rather it created a criminal enterprise and actively attempted to involve inno- cent persons in its operations. The scenario employed by the F. B. I. centered upon the sheik’s plan to construct a fictitious $35 million hotel in Philadelphia, with its result- ant, major impact on the city’s economy. But the rec- ord is devoid of any evidence that payments of money to 2. The Philadelphia U. S. Attorney testified that his office actively lobbied for an opportunity to conduct a Philadelphia ABSCAM operation, attempted to devise strategems to justify bringing ABSCAM to the city, and formulated a scenario which would result in violations of federal law. 6 Petition for a Writ of Certiorari any city official were either sought or required or that any Philadelphia official would have to be dealt with in con- nection with the proposed hotel project. Following a series of telephone calls from Weinberg to Criden, on January 18, 1980, Criden met with F. B. I. Agent Michael Wald, who passed himself off as a rep- resentative of the fictitious sheik.’ Wald pressed Criden for introductions to various municipal officials. He spe- cifically requested a meeting with petitioner Schwartz and Councilman Louis C. Johanson, Criden’s law partner, despite Criden’s protestations that their assistance was unnecessary given the sheik’s prior relationship with two Philadelphia congressmen. Wald then unilaterally raised the issue of payments and agreed to pay Criden $10,000 for the production of Schwartz and Johanson. As of this time, Criden had never met or had any prior dealings with Schwartz. Later that day, Johanson met with Wald. He agreed to support the hotel project and accepted a $25,000 pay- ment. At the end of the meeting, Wald gave Criden $5,000 and promised him “5 for the next delivery.” Johanson testified that, based on his earlier meeting with Criden, he thought the payment was a retainer for lezal services which his law firm would perform on the hotel project. Johanson also testified that as the meeting pro- gressed, he became aware that it “wasn’t kosher.” Later, and because he thought he had been duped by Criden, Johanson refused a request by Criden for an introduction to petitioners, since he felt they were good men whom he did not want to involve in improper activities. On January 23, 1980, Schwartz met with Criden and Wald.* During the meeting, Schwartz repeatedly 3. The meeting with Criden, as were the subsequent meetings with petitioners, was videotaped by the government. 4. Criden had obtained an introduction to Schwartz through a mutual friend, Philadelphia Common Pleas Court Judge Thomas Petition for a Writ of Certiorari 7 pitched Philadelphia, told Wald that the “climate is good” for a major construction project, and noted that any problems arising in connection with a proper and legitimate project could be overcome administratively. Schwartz also advised Wald of his power and influence within City Council and that he, Schwartz, had previously rendered assistance to other developers of major construction proj- ects in Philadelphia. Wald assured Schwartz that the project was a legitimate one but emphasized that, if the project was to be built in Philadelphia, he must have Schwartz’ assurance that there would be no problems. Schwartz repeatedly advised that no guarantees could be given but that, as long as the project was legitimate, any problems could be resolved. Significantly, when Wald first mentioned payments, Schwartz made it clear that money was not the motivating factor behind his agreement to assist with the project. Throughout the meeting, Schwartz discussed the available financing opportunities and the best law firms to employ in connection with the project. Near the end of the meet- ing, Wald again told Schwartz that he must have Schwartz’ unequivocal assurance that everything could be taken care of if he was to report to the sheik that the hotel project could be placed in Philadelphia. Schwartz reiterated that he “cannot give you a guarantee that there won’t be any problems” but that so long as the project was legitimate, administrative procedures in Philadelphia could assist in resolving those problems. At the end of the meeting, a payment of $30,000 was given to Schwartz. Wald then 4. (Cont'd) Shiomos. Shiomos testified that Criden told him that Criden’s clients wanted to hire Schwartz as a consultant and to pay Schwartz for his advice and that he, Shiomos, told this to Schwartz. Judge Shiomos testified that he saw nothing “improper or fishy” in this proposal and so advised Schwartz. A. 159-60. 8 Petition for a Writ of Certiorari gave Criden $5,000 for delivering Schwartz and urged Criden to deliver petitioner Jannotti.’ Although, as with Schwartz, Criden did not know Jannotti prior to the meet- ing, Criden boasted on tape to Wald that he knew Jan- notti well. The F. B. I. did not attempt to verify Criden’s plainly false assertions of knowing Schwartz, and it did nothing to verify his assertions concerning Jannotti. On January 24, Criden produced Jannotti for the hid- den cameras. During the Jannotti meeting, and following an initial discussion of the hotel project, Jannotti was re- peatedly told by the F. B. I. of the requirements of the “Arab mind,” and that the sheik insisted upon making friends and resolving problems before they arose. Wald asserted that the “Arab mind” required that Jannotti accept the payment of money to prove his friendship if the sheik was to construct the hotel in Philadelphia. Jannotti repeatedly expressed his interest in the project, his feeling that the project would be a great bene- fit to the city, and his support for the hotel because it was a legitimate project. However, each time that Jannotti showed reluctance to accept money, the F. B. I. agent in- creased the intensity of his presentation until ultimately Jannotti accepted a $10,000 payment. Once Jannotti left, the F. B. I. agents, obviously frustrated because of Jannotti’s demeanor and lack of understanding or inter- est in the proffered payment, expressed their displeasure to Criden. Petitioners were indicted for conspiracy under 18 U. S. C. §§ 1951 (the “Hobbs Act”) and 1962 (the “Racketeer Influenced Corrupt Organizations Act” or “RICO” ) and also for attempts to violate the Hobbs Act. The attempt charges were dismissed by the District Court 5. Also, during this meeting between Criden and Wald, Wald pressed for introductions to other city officials with whom he could “deal,” naming, among others, the mayor and the former mayor of the city of Philadelphia and various councilmen. Petition for a Writ of Certiorari 9 prior to trial, and the government did not appeal. A. 107 Petitioners were subsequently tried on the two conspiracy counts. Following a siv day jury trial, petitioner Schwartz was found guilty of both the RICO and Hobbs Act con- spiracy charges. Petitioner Jannotti was found guilty of the Hobbs Act conspiracy charge but was acquitted on the RICO count. During the trial, the government placed almost total reliance on the video tapes. The government did not pre- sent independent proof of any actual, potential or any other effect on interstate commerce as a result of peti- tioners’ conduct and, aside from its own agent, Criden, presented no evidence of a “pattern” of racketeering. Likewise, the government introduced no evidence that petitioners sought, requested, solicited, demanded or otherwise affirmatively expressed the need for any pay- ment of money in exchange for official services. Finally, the government introduced no extrinsic evidence of peti- tioners’ predisposition and relied solely upon the events of the meetings and strained inferences from other pe- ripheral evidence to prove predisposition. Both prior to trial and following the trial, the District Court held exten- sive hearings on the due process issues. After verdict, petitioners moved for judgments of acquittal. By Memorandum and Order dated November 26, 1980, the District Court set aside the verdict in its entirety, dismissed the Hobbs Act conspiracy counts for lack of jurisdiction, and granted petitioners’ motions for judgment of acquittal. A. 129. The government appealed the District Court’s ruling and, on February 11, 1982, the United States Court of Appeals for the Third Circuit, sitting in banc, reversed the District Court’s decision by a seven-to-two vote, A. 1, and directed reinstatement of the jury verdict. The in- stant petition to this Court followed. 10 Petition for a Writ of Certiorari REASONS FOR GRANTING THE WRIT With this, the first ABSCAM prosecution to reach this Court, it is now time to confront directly and resolve the critical issue raised by the government's ABSCAM opera- tions: will our legal system permit federal investigative and prosecutorial agencies to create crime, to target and solicit their potential victims, to influence these victims by the use of uncontrolled middlemen and by the tendering of substantial inducements to them, and to script, manu- facture, and mold the evidence which will be used to prosecute and convict these victims? It is petitioners’ position that the creation of crime is an insidious and immoral business and that the government has no place in it. For all of the reasons set forth below, granting of the writ requested is essential. The issues in this case, to quote from Judge Aldisert’s incisive dissenting opinion below, raise questions which involve “an extremely sensi- tive intersection between morals and positive law, which demands that the judiciary assume rather than shirk re- sponsibility.” A. 79-80. The Government's Conduct of ABSCAM Violated the Most Basic Standards of Due Process and Funda- mental Fairness, Reaching and Exceeding That Degree of Outrageousness Which Mandates Dismissal of This Prosecution. Given the extraordinary impact which ABSCAM has had on the national conscience, as well as the effect which any final decision on the ABSCAM affair will have upon the future conduct of law enforcement agencies in this country, it is submitted that the controversy which has swirled around ABSCAM must be definitively resolved. Indeed, so important is the resolution of these issues that they should not be left to piecemeal adjudication by the courts of appeals. Petition for a Writ of Certiorari 11 The District Court in this case applied the “demon- strable level of outrageousness” standard set down in Hampton v. United States, 425 U. S. 484, 495 n. 7 (1976) (Powell, J., concurring), and held that the government's conduct and activities in ABSCAM exceeded permissible limits. Petitioners submit that a review of this record will confirm that the District Court was correct. Due process in the context of criminal proceedings has received only limited treatment by this Court,° but numerous courts of appeals have applied due process con- cepts’ and in several instances, have reversed criminal convictions on this very ground.* Every factor found relevant to the due process analysis by every court of appeals that has considered the issue is present here in the extreme. The government instigated, suggested, set in motion, and “scripted” the entire ABSCAM scheme. ABSCAM epitomizes extremely unfair governmental conduct at the 6. Sorrells v. United States, 287 U. S. 435, 459 (1932) (Roberts, J., separate opinion); Sherman v. United States, 356 U. S. 369, 381 (1958) (Frankfurter, J., concurring); United States v. Russell, 411 U. S. 423 (1973); Hampton v. United States, supra; see Olmstead v. United States, 277 U. S. 438, 485 (1928) ( Brandeis, J., dissenting ); Casey v. United States, 276 U. S. 413 (1928) (Bran- deis, J., dissenting). 7. E.g., United States v. Bocra, 623 F. 2d 281 (3rd Cir.), cert. denied, 449 U. S. 875 (1980); United States v. Prairie, 572 F. 2d 1316 (9th Cir. 1978); United States v. Johnson, 565 F. 2d 179 (1st Cir. 1977), cert. denied, 434 U. S. 1075 (1978); United States v. Leja, 563 F. 2d 244 (6th Cir. 1977), cert. denied, 434 U. S. 1074 (1978); United States v. Reifsteck, 535 F. 2d 1030 (8th Cir. 1976), and see cases cited infra at footnote 8. 8. E.g., United States v. Twigg, 588 F. 2d 373 (3d Cir. 1978); United States v. Archer, 486 F. 2d 670 (2d Cir. 1973); United States v. Russell, 459 F. 2d 671 (9th Cir. 1972), rev'd 411 U. S. 423 (1973); Greene v. United States, 454 F. 2d 783 (9th Cir. 1971); see United States v. West, 511 F. 2d 1083 (3d Cir. 1975). 12 Petition for a Writ of Certiorari highest level. Governmental involvement in ABSCAM was pervasive and extended over the entire period of the scheme. The nature of that involvement was singularly and unfairly designed to lure innocent persons into its web. No evidence of ongoing criminal conduct by either petitioner was present when ABSCAM was injected into their lives, nor did any evidence exist of any prior or con- tinuing criminal activities of this type in Philadelphia mu- nicipal government at the time the ABSCAM operation arrived. Neither petitioner encouraged the government either to initiate or expand the scheme; each responded only to the government’s inducements and protestations of need. No evidence of petitioners’ predisposition, aside from some “puffing” in the course of the governmentally-scripted meetings, could be presented by the prosecution during trial. Extreme pressure was brought to bear on all per- sons involve.! in the Philadelphia ABSCAM operation through the offer of substantial sums of money, the use of the “Arab mind” ruse, and the government's appeal to petitioners’ civic duty through representations that, unless money was accepted to evidence petitioners’ friendship for the sheik, the hotel project would not be placed in Philadelphia. The government's agents employed middle- men who were paid on a contingent fee basis, a tactic condemned by the Fifth Circuit in Williamson v. United States, 311 F. 2d 441 (5th Cir. 1962), on appeal after remand, 340 F. 2d 612 (5th Cir.), cert. denied, 381 U. S. 950 (1965), and they were totally unconcerned with the methods and ploys used by these middlemen to convince persons to participate in the meetings, despite their knowledge of prior deception and unconscionable coaching by these very same middlemen. Finally, the government went to extraordinary lengths to create a climate of temp- tation which itself preyed upon the weakness of the victims of the scheme. Petition for a Writ of Certiorari 13 The government's conduct throughout ABSCAM was the antithesis of fair and effective law enforcement. Neither the government nor Criden had any reason to sus- pect either a propensity to engage in criminal conduct on the part of either petitioner or the presence of any ongoing criminal activity involving petitioners. Yet, the govern- ment directed Criden to inject himself into the petitioners’ lives with the deliberate intent to lure them into criminal activity and with a conscious design to corrupt them. Re- gardless of petitioners’ state of mind at the time they were approached by the government, no reason exists, on this record, even to suggest that, absent the government's instigation in this case, petitioners would not have lived the rest of their lives as law-abiding public officials and re- spected members of the community. The Court of Appeals distorts the significance of the various aspects of the government's activities in ABSCAM by isolating them one from the other, and by failing to recognize that all of these elements, taken together, plainly demonstrate the outrageousness of the government's con- duct. In Greene v. United States, supra, 454 F. 2d at 787, the Ninth Circuit recognized that although “taken individually, none of the factors which we have pointed to as significant would necessarily re- quire reversal of a conviction. In our view, it is the combination which is important.” (Emphasis added ). The totality of factors present here mandates a ruling in petitioners’ favor. Further, in its analysis of the due process question, the Court of Appeals improperly mixes concepts of entrap- ment and due process, failing to recognize the constitu- tional underpinnings of the due process defense. For ex- ample, although proof that the government had no reason for approaching a victim may be irrelevant in the entrap- 14 Petition for a Writ of Certiorari ment context, A. 64, it is and must be a factor in any due process analysis. Similarly, although in the view of the Court of Appeals the inducements offered to petitioners by the government may not have been sufficient to sustain an entrapment defense, see A. 62, these same inducements may, when viewed in conjunction with the entire scope of unfair governmental activity, be a substantial factor in supporting a due process defense. Even if one argues, as does the Third Circuit majority, that the government may employ secretive tactics and de- liberate strategems to ferret out dishonesty among public officeholders or to detect illicit drug transactions, that fact does not sanction the government's instigation, control, and total orchestration of the very criminal activity which it intends to prosecute. In every other case in which the due process defense has been raised, governmental involvement in criminal activity has been passive and the basic criminal design has, in each instance, been conceived and carried out in all material respects by the defendants themselves. In none of those cases has governmental instigation of or involvement in criminal conduct risen to the levels which are present in the Philadelphia ABSCAM case. Here, the government defined the nature of the scheme in an attempt to create the jurisdictional fact— interstate commerce—which would permit it to prosecute this case in the federal courts. In the same manner, the government, through its manipulation of its captive middle- man, Criden, constructed a pattern of bribery which would not have existed but for Criden’s presence throughout the scheme.’ Further, the conduct and language of the gov- 9. The District Court found that the government, through the involvement of its own “agent,” Criden, created, initiated, and in- stigated the pattern of bribery “as well as cach bribe” upon which the RICO charge is premised, solely to satisfy the requirements of RICO and to permit the exercise of federal jurisdiction over fabri- Petition for a Writ of Certiorari 15 ernment’s agents were deliberately ambiguous and mis- leading. Indeed, a review of the record will demonstrate that at no time did the government ever ask either peti- tioner whether the payment of bribes was necessary. Moreover, at no point did the government seek to elicit petitioners’ understanding of the purpose of the meetings. One must conclude that the agents feared that an explicit approach would have resulted in the flight of their victims. Finally, a review of the Circuit Court’s opinion reveals an extraordinary misconception of the role of the judiciary in our society. In the view of a majority of the Third Circuit, it is not the judiciary’s function to determine the constitutional limitations under which our law enforcement agencies are to operate. According to Judge Sloviter: “... the conduct of agents of the executive branch who must protect the public from crime is more ap- propriately considered through the political process where divergent views can be expressed in the ballot box.” A. 66. The opinion of the Court of Appeals manifests a total abnegation of the judiciary’s obligation to define and en- force the rights of citizens under the Constitution. As Judge Aldisert recognizes in his dissent: [T]he philosophical difference that divides this court depends upon a judge’s unspoken notions about the role of the courts. If he or she views the role of 9. (Cont'd. ) cated state bribery charges. Reasoning from United States v. Archer, supra, Judge Fullam held that absent the government's in- jection of these elements into the scheme, no proof of a pattern of racketeering activity under 18 U. S. C. § 1962(c) could be shown, thereby requiring dismissal of the charges on the ground of manu- factured jurisdiction. A. 175. The Court of Appeals never ad- dressed this issue. 16 Petition for a Writ of Certiorari the court as a passive one, he or she will be willing to delegate the responsibility for unpopular issues to the jury and not care greatly what the result may be. If he or she views the court as an instrument of society designed to reflect in its decisions the highest values of the American legal tradition, he or she will be more likely to risk public disapproval and to measure an unpopular cause against the highest ideals and aspira- tions of the time. “The rights conferred upon our society by judges of the Third Article emanated from cases in which the defendants were unpopular and generally re- garded as transgressors—Dollree Mapp, Danny Esco- bedo, and Ernesto Miranda quickly come to mind. In each case, a court, not a jury, drew the line of demarcation between permissible and impermissible police conduct to insure that enforcers of society’s laws would not violate established moral frontiers while exercising their stewardship; it was federal judges, unmindful of editorials and broadcast plaudits, who chose to stand tail and unbending.” A. 80. (Footnote omitted ). If a national benchmark defining limits on law en- forcement activity of this type is not established, no citizen is secure from the clandestine imposition of morality tests conceived and administered by the federal bureaucracy for purposes ranging from legitimate law enforcement to chilling political intimidation. Petition for a Writ of Certiorari 17 Where the Evidence of Governmental Inducement Is Overwhelming, the Government May Not Rely Upon Evidence of “Ready Acquiescence” Manufactured by It to Meet Its Burden, Nor Can a Court Sustain a Conviction in an Entrapment Case on Proof of Com- mission of the Criminal Act Alone. Although recognizing that under the law of entrap- ment it is the government’s burden to prove predisposition beyond a reasonable doubt, the Third Circuit proceeds to ignore this standard of proof, to impose upon a criminal defendant the obligation to prove lack of predisposition, and to permit the verdict below to stand on evidence of the commission of crime alone. If the Court of Appeals’ ruling is not reversed, the entrapment defense will have been obliterated. Predisposition involves a difficult inquiry into the defendant’s subjective state of mind. “[T]he controlling question [is] whether the defendant is a person otherwise innocent whom the Government is seeking to punish for an alleged offense which is the product of the creative activity of its own officials.” Sorrells v. United States, 287 U. S. 435, 451 (1932). Subsumed within any discussion of entrapment is the complex, intertwined relationship between inducement and predisposition. As the Third Circuit itself recognized in United States v. Watson, 489 F. 2d 504 (3d Cir. 1973): “[T]he stronger the inducement, the more likely that any resulting criminal conduct of the defendant was due to the inducement rather than to the defendant's own predisposition.” Id. at 511. The extraordinary degree of government inducement in this case has already been reviewed. Given evidence of these overwhelming inducements, the government's evidentiary burden to prove predisposition was substantial. 18 Petition for a Writ of Certiorari But the majority of the appellate court abjures any neces- sity to conduct a review of the entire record, despite its profession of the appropriateness of such a procedure. A. 41-42. Instead, as Judge Aldisert points out, it satisfies itself with a rebuttal of the items relied upon by the Dis- trict Court in entering judgments of acquittal. A. 93. In so doing, the court again relieves the government of its obligation to prove predisposition by good and sufficient evidence and effectively shifts the burden of disproof onto the petitioners. Petitioners submit that a review of the record will plainly demonstrate that not a scintilla of evi- dence exists to establish the requisite predisposition, let alone to counterbalance the weight which must be ac- corded to the uncontradicted proof of massive govern- ment inducement. Second, although appreciating that predisposition has been historically proven by, for example, proof of a de- fendant’s prior convictions, his participation in similar transactions or proof of bad character, the Court of Ap- peals majority makes the startling observation that since “[s]uch evidence would be extremely difficult to produce in the case of acceptance of a bribe by a public official .. . . the very acceptance of a bribe by a public official may be evidence of a predisposition to do so when the opportunity is presented.” A. 53-54. Again, the majority of the court below states, in the most blatant terms, that proof of the criminal act, a fact which must be admitted of necessity by a criminal de- fendant if he is to be permitted to argue entrapment, is enough when it is a public official who is in the dock. No basis for the application of such a double standard exists in our law. Further, even if one ignores the broad concept set down by the Court of Appeals that proof of the crime of extortion is sufficient to defeat the entrapment defense and Petition for a Writ of Certiorari 19 accepts that court’s abstract proposition that the demeanor of the petitioners during the commission of the criminal act is sufficient proof upon which to premise a finding of predisposition, attention must be directed to the nature of that proof which was presented at trial. In this case, the government created the scheme, sent out its agent, Criden, to recruit the victims of the scheme, enticed the petitioners to attend staged meetings, orches- trated and scripted every aspect of those meetings, and controlled the flow of conversation to the extent that the petitioners’ statements were always made in response to continuously monitored specific inquiries of the govern- ment. The conduct and conversation of the government's agents at the meetings were admittedly designed for the sole purpose of obtaining evidence to be used in a future proceeding. Nevertheless, it is this very evidence and only this cvidence—this demeanor of petitioners at the meetings—which the government now contends is suff- cient to satisfy its burden of proof of predisposition. No logic exists which would justify a finding that the government may mold and manufacture the “ready re- sponse” evidence and then would permit reliance upon this evidence as the sole proof of predisposition. In no case in which proof of government inducement was as overwhelming as this case has any court permitted a con- viction to stand on the flimsy “ready acquiescence” evi- dence presented here. Although in some situations a defendant’s ready acquiescence to the government's sug- gestions may be enough to justify a finding of predisposi- tion, here neither petitioner said or did anything tending to establish pre-existing criminal inclinations, or exhibited such familiarity with criminal techniques and procedures as to demonstrate previous experience with similar criminal activity. In short, there was no evidence to show that when the government’s overtures first came to the atten- 20 Petition for a Writ of Certiorari tion of Schwartz and Jannotti they were already predis- posed to accepting bribes. At bottom, it is clear that the court’s rejection of the entrapment defense rests upon the simplistic notion that all petitioners had to do when offered the money was to say “No thanks.” A. 58. Such an approach to the difficult jurisprudential problem raised by this case is wholly un- acceptable. Peeling away the veneer of language in the court’s opinion, one finds only the proposition that if petitioners are to be punished for their immorality, the defense of entrapment must be seriously compromised or, indeed, eradicated. Review by this Court of the critical entrapment issues raised by this case is essential. The Third Circuit’s Ruling on Hobbs Act Jurisdiction in This Case Conflicts With the Rulings of Three Courts of Appeals, Impacts on All Federal Criminal Legis- lation Enacted Under the Commerce Clause, Mis- applies Prior Holdings of This Court, and Is Erroneous Under the Facts of This Case. The interstate commerce requirement in the Hobbs Act, 18 U. S. C. § 1951, is a jurisdictional prerequisite to any prosecution under that Act. As this Court held in United States v. Feola, 420 U. S. 671, 695 (1975), in an analogous circumstance, “[t]he jurisdictional requirement is satisfied by the existence of facts tying the proscribed conduct to the area of federal concern delineated by the statute.” (Emphasis added). In its decision below, the Court of Appeals completely disregards this fundamental concept, establishes a standard of proof which is in direct conflict with the standards employed hy the Fourth, Sev- enth, and Ninth Circuits, sustains a conviction tor Hobbs Act conspiracy where no jurisdictional fact was or could have been proven, misinterprets this Court’s prior deci- sions in Feola and Perez v. United States, 402 U. S. 146 Petition for a Writ of Certiorari 21 (1971), and demonstrates a basic misunderstanding of the jurisdictional limitations inherent in all federal legis- lation. For these reasons and because, as the Court of Appeals does recognize, a determination, in the Hobbs Act context, as to the extent of Congress’ power under the commerce clause “will have ramifications for all federal criminal statutes enacted under Congress’ commerce clause power,” A. 26, review of the Hobbs Act issues raised herein is imperative. First, in United States v. Staszcuk, 517 F. 2d 53 (7th Cir.) (en banc), cert. denied, 423 U. S. 837 (1975), Judge, now Justice, Stevens addressed the interstate com- merce issue raised by the Hobbs Act, and held: “[T]he statutory language [of the Hobbs Act]. . . requires the prosecutor to prove some connection with interstate commerce in every case. We hold, how- ever, that the commerce element of a Hobbs Act vio- lation—the federal jurisdictional fact—may be satis- fied even if the record demonstrates that the extortion had no actual effect on commerce. . . . [J Jurisdiction in the particular case is satisfied by showing a realis- tic probability that an extortionate transaction will have some effect on interstate commerce. “The jurisdictional inquiry must, of course, focus on the situation at the time of the offense.” Id. at 59-60. (Emphasis added) (Footnotes omitted). Since 1975, the “realistic probability” test enunciated in Staszcuk has continued to be the law in the Seventh Cir- cuit and has been adopted and uniformly applied by the Fourth and Ninth Circuits.” 10. E.g., United States v. Rindone, 631 F. 2d 491, 493 (7th Cir. 1980); United States v. Phillips, 577 F. 2d 495, 501 (9th Cir.), cert. denied, 439 U. S. 831 (1978); United States v. Spagnolo, 546 F. 2d 1117, 1119 (4th Cir. 1976) (per curiam), cert. denied, 433 U. S. 22 Petition for a Writ of Certiorari which the ABSCAM operation was premised was wholly fictitious. Accordingly, the government could not and did not prove at trial that, had the scheme been carried out, commerce would have been affected."’ Likewise, since the government, through its agents, never had any inten- tion to implement the scheme, there never existed any pos- sibility that the charged conspiracy would ever have any effect upon interstate commerce. Despite these undis- puted facts, the Third Circuit held that where a defend- ant’s conduct constitutes “a sufficient threat to interstate >» commerce so as to implicate an ‘area of federal concern’, federal jurisdiction is established. Thus, in direct conflict with Staszcuk, the Third Circuit has wrongly substituted a wholly subjective test, which would rest federal jurisdiction upon hypothetical, imaginary or non-existent effects on commerce. Under the rationale of Feola, jurisdiction must be predicated upon facts. In Feola, the jurisdictional nexus under 18 U. S. C. § 111 is satisfied by the existence of a fact, the presence of a federal officer, just as jurisdiction under the Hobbs Act is based upon the existence of a fact—an effect on interstate commerce. If A and B con- spire to assault X and X turns out to be a federal officer, the federal jurisdictional fact, and in turn federal jurisdic- 10. (Cont'd. ) 909 (1977). Numerous other Courts of Appeals have referenced the Staszcuk formulation in passing on Hobbs Act jurisdiction is- sues, including the Third Circuit itself. E.g., United States v. Cerilli, 603 F. 2d 415, 424 (3d Cir. 1979), cert. denied, 444 U. S. 1043 (1980). 1l. It is undisputed that no evidence, of any nature, was introduced at trial by the government to show that the alleged con- spiracy would have had any effect, actual or potential, on com- merce if performed. A. 130. Petition for a Writ of Certiorari 23 tion, is present. However, if A and B conspire to assault X who they mistakenly believe to be a federal officer, the federal jurisdictional fact is not present. Likewise, if a federal agent tells A and B that X, a federal officer, will be arriving to arrest them, and A and B agree to assault X upon his arrival, but X is a creation of the federal agent's imagination, just as was the hotel project in ABSCAM, there can be no federal jurisdiction. Federal jurisdiction is not predicated solely upon the state of mind of the defendants. Fictions cannot replace jurisdictional facts. In this case, measured by the facts, no effect on commerce could ever take place. Second, permeating every aspect of this case is the uncontroverted fact that the federal government insti- gated, scripted, and implemented ABSCAM. The federal agents thus unilaterally fashioned a scheme which they hoped would satisfy jurisdictional requirements. In each case relied upon by the Court of Appeals, however, the nature and extent of the conspiracy—the substance of the criminal design—was formulated by the defendants themselves.” If the focus of the jurisdictional inquiry is upon the conspiratorial agreement, see United States v. Feola, supra, 420 U. S. at 695-96, it is both illogical and patently unfair to sanction governmental manipulation of that agreement solely to create federal jurisdiction. If the pur- pose of the federal conspiracy laws is to provide federal law enforcement officials with the tools necessary to com- bat criminal conduct in “areas of federal concern,” it is likewise illogical to contend that these same officials may unilaterally create an “area of federal concern” in any given case so that they may prosecute it. 12. See cases cited in the opinion of the Court of Appeals at A. 28-31. 24 Petition for a Writ of Certiorari Whether one accepts Judge Aldisert’s formulation that “A purely hypothetical effect, a fairy tale conjured by the FBI . . . is not ‘a sufficient threat to [commerce] so as to give rise to federal jurisdiction, ” or one employs Judge Friendly’s “manufactured jurisdiction” approach, United States v. Archer, supra, 486 F. 2d at 682, the reality is that no real, actual impact on commerce could have ever occurred in this case and but for the government's creation and injection of an interstate element into the scheme, the federal courts would be without jurisdiction to prosecute petitioners under the Hobbs Act. This case, even more than Archer, epitomizes the concept of “manu- factured federai jurisdiction.” “ Third, not only does the opinion of the Court of Ap- peals demonstrate a complete misunderstanding of Feola, see 420 U. S. at 695-96,"* which clearly states that a federal officer must be the subject of an agreement to assault if federal jurisdiction is to be present, but it also reflects a fundamental misperception of and a lack of respect for the essential nature of federal criminal jurisdiction. As Judge Aldisert recognizes: 13. In its Opinion, the District Court stated: “Moreover, to permit this kind of artificial federalization would effectively remove virtually all of the limitations upon the criminal jurisdiction of federal courts, and would be utterly contrary to accepted notions of federalism.” A. 153-54 (Em- phasis added). 14. In her Opinion, Judge Sloviter remarks: “In holding [in Feola] that there was a ‘sufficient threat’ to an ‘area of federal concern’ to meet the jurisdictional re- quirements as long as a federal officer was in fact the target of the planned attack, 420 U. S. at 695, the Court did not preclude the existence of federal jurisdiction where the intended victim is believed to be a federal officer, but in fact is not.” A. 32. (Emphasis added). Petition for a Writ of Certiorari ; 25 “The majority interweaves its jurisdictional argument with the argument that factual impossibility of com- pleting a substantive offense does not bar a conviction of conspiracy. They confuse proof of the crime of conspiracy with the jurisdictional power to punish the crime. The presence of subject matter jurisdic- tion is a discrete and primary issue in each case pre- sented to a federal court, unlike a state court. The effect on commerce is both jurisdictional and substan- tive in a Hobbs Act prosecution, but the two inquiries are separate and distinct. See, e.g., Feola, 420 U. S. at 694-96.” A.101. (Emphasis added). Not only are the two inquiries “separate and distinct,” but also the standards by which they are determined differ. Respecting proof of the substantive offense, the subjective criminal intent of an alleged Hobbs Act defendant is cru- cial; respecting proof of Hobbs Act jurisdiction, however, the subjective criminal intent of a Hobbs Act defendant is irrelevant. The intent of the Hobbs Act defendant can neither create nor negate the jurisdictional fact. In Staszcuk, Judge Stevens understood this distinction and formulated a test which respected it. Judge Sloviter, in her opinion for the court below, paid lip service to the limitations inherent in the Constitution’s grant of power to Congress to legislate under the commerce clause and established a test which shifts the focus of the jurisdic- tional inquiry away from the “existence of [real] facts” and to the subjective intent of the actor. As a result, the ob- jective “realistic probability” test established by Staszcuk has been disembowled by the Third Circuit and the re- quirement in Feola that jurisdiction be predicated on fact has been eliminated. Finally, the Court of Appeals faults the petitioners for failing te present any “policy reason” for it to accept 26 Petition for a Writ of Certiorari “their restrictive view” of the jurisdictional reach of the Hobbs Act. A. 32. But the policy is clear. The federal courts are a creation of the Constitution and of Acts of Congress, and, as such, they are courts of limited jurisdic- tion. Jurisdiction under the Hobbs Act is predicated on the commerce clause. Interference with commerce must be proven before the federal courts may prosecute a viola- tion of the Hobbs Act. Absent actual interference with commerce or clear proof that an actual impact on com- merce would have resulted from a criminal defendant's actions, the federal courts cannot hear the case. It is peti- tioners’ position that the Court of Appeals, by its ruling, has abolished all jurisdictional limitations which hereto- fore existed under the Hobbs Act and has constructed a standard “which in practicality would extend federal juris- diction over just about any robbery or extortion.” United States v. French, 628 F. 2d 1069, 1077 (8th Cir.), cert. denied, 101 S. Ct. 364 (1980). A Conviction for Extortion Under the Hobbs Act Absent Proof of Inductment by a Defendant Should Not Be Permitted, and Clarification of This Issue Is Essential. A plain reading of the definition of “extortion” in the Hobbs Act shows that proof of inducement is necessary to convict. The District Court held that the absence of proof of any express or implied demand or request for payment by petitioners requires dismissal of the Hobbs Act charges. A. 110. The Court of Appeals reversed, asserting that the law is clear throughout the circuits that proof of inducement by a public official acting “under color of official right” is unnecessary. A. 33. Petitioners submit that both the decision of the Court of Appeals and its rationale are incorrect. The First, Third, and Eighth Circuits have each ap- proved jury instructions which require a specific finding Petition for a Writ of Certiorari 27 of inducement.” In fact, except for Staszcuk, where insufficient detail is provided to determine whether af- firmative action was taken by the defendant, and United States v. Hedman, 630 F. 2d 1184 (7th Cir. 1980), cert. denied, 450 U. S. 965 (1981), which does nothing more than cite, as “settled law,” the very cases which either include evidence of inducement or approve a charge on inducement, there is no decision under the Hobbs Act involving a public official which sustains an extortion con- viction absent evidence of inducements, or of “initiative and purpose,” United States v. Hyde, 448 F. 2d 815, 833 (5th Cir. 1971) (Wisdom, J.), cert. denied, 404 U. S. 1058 (1972), on the part of the official.’® In this case, it is clear that neither of the petitioners nor anyone acting on their behalf, at any time, requested or demanded money in connection with the proposed con- struction of the hotel in Philadelphia or in exchange for petitioners’ use of their official positions. Rather, the evi- dence is clear that petitioners were, at most, the passive recipients of money and would have supported the pro- posed project whether or not any money was paid to them. In those cases decided under the Hobbs Act in which public officials were not defendants, the law has long been clear that, in the absence of proof that defendants induced or intended to induce payment, the mere ac- ceptance of a bribe does not constitute extortion or violate 15. See United States v. Hathaway, 534 F. 2d 386 (Ist Cir.), cert. denied, 429 U. S. 819 (1976); United States v. Addonizio, 451 F. 2d 49, 59 (3d Cir.), cert. denied, 405 U. S. 936 (1972); United States v. Adcock, 558 F. 2d 397 (8th Cir.), cert. denied, 434 U. S. 921 (1977). 16. “In other words, while the essence of bribery is voluntari- ness, the essence of extortion is duress.” United States v. Addo- nizio, supra, 451 F. 2d at 72, citing People v. Dioguardi, 8 N. Y. 2d 260, 203 N. Y. S. 2d 870, 168 N. E. 2d 683 (19680). 28 Petition for a Writ of Certiorari the Hobbs Act. E.g., United States v. Gerald, 624 F. 2d 1291 (Sth Cir. 1980), United States v. Duhon, 565 F. 2d 345 (5th Cir.), cert. denied, 435 U. S. 952 (1978), United States v. Hyde, supra." And, as noted above, given the requirement of inducement even in official corruption cases and the fact that no case involving official corruption has ever resulted in conviction of the defendant absent proof of a request or demand, the Court of Appeals’ read- ing of the Hobbs Act statute and the conclusion which it reached are clearly incorrect. Clarification of this trouble- some issue is plainly warranted. 17. Indeed, no rational argument can be made to support di- vergent approaches to the Hobbs Act. As the court stated in Hyde, “[t]he distinction from bribery is therefore the initiative and purpose on the part of the [defendant] and the fear and lack of voluntari- ness on the part of the victim.” Id. at 833. Petition for a Writ of Certiorari 29 CONCLUSION For the foregoing reasons, a writ of certiorari should issue to the Court of Appeals for the Third Circuit so that this Honorable Court may review and correct the decision below. Respectfully submitted, Of Counsel: Di_wortH, Paxson, KALIsH & KAUFFMAN Caro. A. MEEHAN 2600 The Fidelity Bldg. Philadelphia, PA 19109 Of Counsel: SPRAGUE & RUBENSTONE Suite 400, Wellington Bldg. 135 South 19th Street Philadelphia, PA 19103 J. CLayton UNDERCOFLER, III Rosert N. pE Luca 2600 The Fidelity Building Philadelphia, PA 19109 (215) 875-7000 Attorneys for Petitioner Harry P. Jannotti RICHARD A. SPRAGUE Epwarp H. RUBENSTONE Suite 400, Wellington Bldg. 135 South 19th Street Philadelphia, PA 19103 (215) 561-7681 Attorneys for Petitioner George X. Schwartz XIpUaddly 81-1899 Supreme Court, U.S. FiLED APR 12 1982 bisintdiiciees L. STEVAS Supreme Court of the United States October Term, 1981 HARRY P. JANNOTTI, Petitioner UNITED STATES OF AMERICA, Respondent GEORGE X. SCHWARTZ, Petitioner UNITED STATES OF AMERICA, Respondent JOINT APPENDIX OF PETITIONERS JANNOTTI AND SCHWARTZ . Ciayton UNpercor.enr, III opert N. pe Luca 2600 The Fidelity Building Philadelphia, Pennsylvania 19109 (215) 875-7000 Attorneys for Petitioner Harry P. Jannotti Ricuarp A. SPRAGUE Epwarp H. RuBENSTONE Suite 400, Wellington Building 135 S. 19th Street Philadelphia, Pennsylvania 19103 (215) 561-7681 Attorneys for Petitioner George X. Schwartz international Printing Co., 711 So. S0th St. Phila., Pa. 19143 — Tel. (215) 727-8711 TABLE OF CONTENTS OF JOINT APPENDIX Page Opinion of the United States Court of Appeals for the Third Circuit Entered February 11, 1982 ................... Al Memorandum and Order of the United States District Court for the Eastern District of Pennsylvania Entered August el ide de eee ded eee ekneiane A107 Memorandum and Order of the United States District Court for the Eastern District of Pennsylvania Entered Nevem- I tian bece eee eecep ben eemetaeenentesies Al29 Order of the United States Court of Appeals for the Third Circuit Entered August 26, 1981 ...................-. A179 Judgment of the United States Court of Appeals for the Third Circuit Entered February 11, 1982 ............. A181 Al UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT Nos. 81-1020 and 81-1021 UNITED STATES OF AMERICA Appellant in No. 81-1020 v. JANNOTTI, HARRY P. (D.C. Crim. No. 80-00166-02) UNITED STATES OF AMERICA, Appellant in No. 81-1021 v. SCHWARTZ, GEORGE X. (D.C. Crim. No. 80-00166-04) APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA Argued June 10, 1981 Before: ALDISERT, WEIS, and SLOVITER, Circuit Judges Reargued In Banc November 23, 1981 Before: SEITZ, Chief Judge, ALDISERT, ADAMS, GIBBONS, HUNTER, WEIS, GARTH, HIGGINBOTHAM and SLOVITER, Circuit Judges (Opinion filed February 11, 1982) A2 Peter F. Vaira United States Attorney Walter S. Batty, Jr. Assistant United States Attorney Chief, Appellate Division Joseph M. Fioravanti (Argued) Assistant United States Attorney James J. Rohn Assistant United States Attorney Room 3310 U. S. Courthouse 601 Market Street Philadelphia, Pa. 19106 Paul Shechtman Criminal Division Department of Justice Washington, D.C. 20530 COUNSEL FOR APPELLANT J. Clayton Undercofler, III, Esq. Robert N. deLuca, Esq. (Argued) Carol A. Meehan, Esq. 2600 The Fidelity Building Philadelphia, Pa. Of Counsel: Dilworth, Paxson, Kalish & Levy COUNSEL FOR APPELLEE HARRY P. JANNOTTI Richard A. Sprague, Esq. (Argued) Edward H. Rubenstone, Esq. Sprague, Goldberg & Rubenstone 135 South 19th Street Philadelphia, Pa. 19103 COUNSEL FOR APPELLEE GEORGE X. SCHWARTZ A3 OPINION OF THE COURT SLOVITER, Circuit Judge. On September 16, 1980, after a six-day trial, a jury found defendants Harry P. Jannotti and George X. Schwartz guilty of conspiring to obstruct interstate com- merce, in violation of the Hobbs Act, 18 U.S.C. §1951(a), and found Schwartz guilty of conspiracy in violation of the Racketeer Influenced and Corrupt Or- ganizations Act, 18 U.S.C. §1962(d). At the time of the events charged in the indictment, Schwartz was presi- dent of the Philadelphia City Council and Jannotti was the Council’s majority leader. Following the entry of the guilty verdicts, defendants renewed their requests for judgments of acquittal and dismissal of the indictment, on which the trial court had previously reserved deci- sion. On November 26, 1980, the district court entered an order setting aside the verdict of the jury in its entire- ty, dismissing Count III of the indictment (the Hobbs Act count) for lack of jurisdiction, and granting the mo- tions of defendants for judgment of acquittal. The Gov- ernment appeals. ' In his opinion accompanying the order, the trial judge gave four reasons for entry of the judgment of ac- quittal and dismissal of Count III of the indictment. United States v. Jannotti, 501 F. Supp. 1182 (E.D. Pa. 1980). He concluded: 1. The government suggests that we have jurisdiction under 28 U.S.C. §1291. That section does not create appellate jurisdiction over appeals by the United States in criminal cases. DiBella v. Unit- ed States, 369 U.S. 121, 130 (1962); Government of the Virgin Is- lands v. Hamilton, 475 F.2d 529 (3d Cir. 1973). However. we have jurisdiction over these appeals pursuant to the Criminal Appeals Act, 18 U.S.C. §3731. See United States v. Wilson. 420 U.S. 332 (1975); United States v. Schoenhut, 576 F.2d 1010. 1018 & n.7 (3d Cir.), cert. denied, 439 U.S. 964 (1978). A4 1. The evidence at trial did not establish the actual or potential impact upon interstate commerce necessary to sustain federal jurisdiction under the Hobbs Act; 2. The evidence at trial established entrapment as a matter of law; 3. Governmental overreaching amounted to a viola- tion of due process of law; 4. The circumstances relied upon to establish fed- eral jurisdiction were artificially created. Id. at 1205. Our review of the record and applicable law con- vinces us that in reaching these conclusions the district court erred in its legal analysis and usurped the function of the jury to decide contested issues of fact. We reverse the district court’s order and direct reinstatement of the jury’s verdict. I. SUMMARY OF EVIDENCE An understanding and appreciation of the evidence presented to the jury is essential to consideration of the issues facing us on this appeal. We have therefore un- dertaken an exposition of some of the highlights of that evidence. The government operation, which has come to be known as ABSCAM, began some time in 1978. The basic nature of the plan was that F.B.1. agents posed as employees of Abdul Enterprises, a fictional multi- national corporation whose principal, a fictional Arab Sheik, Yassir Habib of the Arab nation of Abu Dhabi, was represented as interested in investing large amounts of money in this country and in emigrating here. According to the government, the plan was “con- ceived to create opportunities for illicit conduct by public officials predisposed to political corruption.” Brief for Ap- pellant at 6. From the very beginning the government utilized the services of Melvin Weinberg, accurately characterized by the district court as a “career swindler,” AS 501 F. Supp. at 1193,” who, with F.B.]. agents, “spread the word” that the Sheik was interested in meeting pub- lic officials who could facilitate his planned investments. This basic plan evolved into various subparts, each with its own cast of participants, which were ultimately the subject of a series of indictments returned by grand juries sitting in various federal districts of the country. Thereafter, a number of local and federal public officials were tried on offenses arising out of their participation. We focus on the facts material to the prosecution of Jannotti and Schwartz in the Eastern District of Pennsylvania.* The Philadelphia phase began on January 11, 1980 when Weinberg called Howard Criden, a Philadelphia attorney, and told him that the Sheik was “looking to build a hotel” in Philadelphia. Criden, who had previous- ly received money from the F.B.I. agents for arranging introductions to congressmen in connection with an- other phase of the ABSCAM operation,’ was told that 2. Weinberg was convicted of mail fraud and wire fraud in 1977. At the intercession of the government, he was sentenced to three years probation in return for his agreement to help in the ABSCAM investigation. He was paid $3,000 a month by the F.B.1. as of the time of the trial, had received a total of approximately $140,000 up to that time, and had also received other fringe benefits. 3. The trials of two other defendants, Louis C. Johanson, a member of Philadelphia City Council, and Howard L. Criden, a Philadelphia attorney, who were indicted along with Schwartz and Jannotti were severed from that of Schwartz and Jannotti. Both Johanson and Criden were convicted on similar charges in the Unit- ed States District Court for the Eastern District of New York, and the government moved for their dismissal as defendants here. 4. Criden, Johanson, and Mayor Errichetti of Camden, New Jersey, were instrumental in arranging for four congressmen. in- cluding Philadelphia Congressmen Myers and Lederer. to meet the F.B.I. agents. At the meetings the congressmen agreed to introduce immigration bills in return for money, leading to their ultimate in- dictment and conviction. A6 two representatives of the Sheik would be coming to Philadelphia to begin discussions. Weinberg suggested that they be introduced to Congressman Myers or Lederer, and asked Criden which one would be better. CRIDEN: Well, I got to hear what you want to do first, and. . . you know. WEINBERG: I think they’re looking to build a hotel there. I'm not sure. That’s only what I heard. CRIDEN: Okay. Why don't you tell him to find out more particulars because I don’t know that ei- ther one would help you in that department. We may be able to give you more help to them. WEINBERG: Who do you know there? CRIDEN: Everybody! WEINBERG: Everybody? CRIDEN: Everybody! WEINBERG: Allright. Pll. . . I'll. CRIDEN: Remember. | got a partner who's a city councilman. A211-12. A week later, on January 18, 1980, Criden met with F.B.1. agents Michael Wald and Ernest Haridopolos at the Barclay Hotel in Philadelphia. Wald and Haridopolos used the names Michael Cohen and Ernie Polos in their dealings with defendants throughout these events. That meeting was among the group of meetings at the Bar- clay recorded on videotape by the F.B.I. Wald told Criden that the Sheik was interested in building a hotel in South Philadelphia, that Wald’s role was to address himself to possible problems such as zoning, condemna- tions, and variances. A351. Criden stated, “You don’t have any problem. You got you two of the strongest guys” [referring to Myers and Lederer}. Wald responded, “He [Sheik] wants to be assured that municipal govern- ment and he can coexist.” Criden asked, “How do you want me to satisfy you,” to which Wald responded, “I'm sure the easiest way for me to deal with someone in mu- A7 nicipal government and I can go back... . Titles im- press the man, as you know, from past experience. . . . If he receives those assurances from someone with a ti- tle sounds appropriate, eh, I buy it, he buys it.” A351-53. Wald asked Criden about the municipal setup, in- cluding city council. Criden explained that Philadelphia City Council is composed of 12 district councilmen and five at-large councilmen, that his “partner [Johanson is} a district councilman”, and that the president of city council, Schwartz, “is a powerful guy” who had been “president of city council for maybe now ten, twelve years, already now. Has got power.” Wald responded, “He’s the man.” A354-55. Wald later asked: WALD: Can we deal with Mr. Schwartz. CRIDEN: Oh, sure. WALD: He seems like the type of person we CRIDEN: Oh, sure. WALD: Can I deal with him while I'm here in town? CRIDEN: I don’t know. I gotta get hold of my WALD: Can I deal with your partner? CRIDEN: Oh, sure. A357. After some discussion of timing and the proper “tariff,” Wald asked if he could talk candidly with Johanson. Criden responded that “As far as Johanson is concerned, you can talk as candidly as you want.” With regard to Schwartz, he stated, “He may want to handle it indirectly.” A367. Wald expressed some concern, stating that under no circumstances would he want to disap- point his employer. CRIDEN: Listen, Mike, I, I read you loud and clear and if I was sitting in that chair, | would feel exactly the same way ok. You have no problems with me. A8& WALD: Ok. How do you want to work this? Eh, do you wantta call me back here concerning CRIDEN: Oh sure. WALD: Mr. Johanson. CRIDEN: T'll get back to you in the next cou- ple hours. WALD: Alright. CRIDEN: If I can serve him up. A368-69. Wald then asked what the “tariff” would be for Johanson and Schwartz, and Criden replied “[t}wenty-five” for Johanson, A375, and “|a|nother fifty” for Schwartz. A376. Wald demurred at the latter figure, and Criden asked, “You wanta go thirty on this guy?” Wald asked, “will he bite at thirty?. . . 1 mean does that take care of him?” and Criden replied, “Let me try it I'll run it up the flagpole.” A376-77. Finally Criden raised the subject of his fee and asked for and was promised “ten for both of them.” A377. Several hours later, Criden returned with Johanson to the Barclay suite where Wald and Haridopolos waited. Wald again discussed the proposed hotel construction, explained that he wanted to avoid delays due to the need for a variance or a building permit, and received Johanson’s assurances that the inspectors from Licenses and Inspections, the building inspectors, the plumbing inspectors, and the electrical inspectors are “not gonna monkey with you, for a minute because they're gonna be told not to. . . because the words gonna come down, that this is a vital project.” A421. In discussing the politi- cal situation in Philadelphia, and City Council in par- ticular, Johanson boasted that of the 17 councilmen, he and Schwartz was each a “very bright fella”, and “after that there ain’t a brain in the closet.” A415. He spoke of his and Schwartz’ importance, and stated that Schwartz, Jannotti and he “run the City Council.” A450. Wald then asked about Jannotti: A9 WALD: Would he be interested in doing busi- ness with us. JOHANSON: I don’t know that it’s necessary but if you want to we can. WALD: I don’t know — if it is —- you're the best judge of that. JOHANSON: I think George is ah — CRIDEN: Well, it might not be a bad idea to bring Harry up. JOHANSON: We can bring Harry up. Harry's the Majority Leader. He’s the — ya know, second in command. WALD: Yea. JOHANSON: He's got seniority. A453-54. After some additional discussion, the following exchange took place: HARIDOPOLOS: Are you acquainted with how much ah, ya know, ah for the favor and for all these assur — assurances, right. CRIDEN: Right. HARIDOPOLOS: You know how much it is? JOHANSON: Sure. HARIDOPOLOS: How much is it? JOHANSON: Twenty-five. HARIDOPOLOS: Okay, ah but, of course, ah, we have to have these proper assurances. You do us a favor, we’re doin you a favor. CRIDEN: Obviously. JOHANSON: Sure. A471. Johanson gave his assurances and received $25,000. A480. The following exchange took place: WALD: And for 25 we've got a friend. JOHANSON: Right. A477. The conversation turned to Schwartz: WALD: Can I talk to Mr. Schwartz as I have spoken — A10 JOHANSON: Next week — WALD: — to you gentlemen — WALD. [F]rankly. . . CRIDEN: If you can’t have the same discus- sion with George, . . . you won't have the meeting. A485. Wald asked the same question about Jannotti. Criden promised to let him know whether he could have the same kind of conversation with Jannotti. A490. After Johanson left, Haridopolos gave Criden $5,000 and promised another “five for the next delivery.” A501. Criden, who did not know Schwartz personally, ar- ranged for Schwartz to meet the F.B.I. agents through an intermediary, Judge Thomas Shiomos of the Court of Common Pleas of Philadelphia County, who lived in the same apartment hotel as Schwartz. Shiomos testified at trial that at a meeting on January 21, 1980 between him, Criden and their mutual friend, Mr. Kattheman, Criden told him of the proposed hotel construction, asked him if Schwartz would be interested in talking to “these people . . . for the purpose of giving them his advice with re- gard to building this complex in Philadelphia,” and indi- cated that the investors were willing to “pay for [Schwartz’] advice.” A639-40. Shiomos thereafter met with Schwartz, advised him that Criden had wealthy Arab clients who wanted to invest $150 million to build a hotel in Philadelphia, and indicated to Schwartz that Criden had said there “would be a fee for Mr. Schwartz for his advice” and “that Mr. Criden expected part of that fee.” A643. Schwartz stated that he “would be interested in anyone who is willing to invest $150 million.” Shiomos stated when he left that he didn’t think there was anything “improper” but that if Schwartz “thought there was anything improper or fishy |Shiomos was] sure if [Schwartz] met with Mr. Criden that [Schwartzj All could determine that.” A644.° Thereafter Criden spoke with Schwartz. That discussion was not taped or record- ed, and there was no trial evidence as to the contents of the conversation.® On January 23, 1980, Criden and Schwartz visited Wald at the Barclay suite. This conversation was videotaped. Criden stated that he and Schwartz had “spoken at length” and that Schwartz knew that those persons whom Wald represented were “interested in building a hotel facility in Philadelphia that may amount to some 30 or 40 million dollars.” A689. Wald explained his purpose: WALD: Well, what I have been instructed to do and the purpose for ah my visits to to Philadel- 5. Some time after Schwartz attended the January 23, 1980 meeting at the Barclay, Shiomos and Kattleman went to Kattleman’'s apartment where Criden lay $6,000 on the table as the fee to be paid to Shiomos and Kattleman. Shiomos assumed this was a portion of Criden’s share of the fee that was paid to Schwartz. A654. Shiomos testified he gave his $3,000 share to Kattleman. A655. 6. In his post-trial testimony, Criden testified: Q. All right, now, when you went and saw Mr. Schwartz after Judge Shiomos had arranged for the interview, did you tell Mr. Schwartz that the purpose for Mr. Schwartz going there is to be a consultant for these Arabs or the Arab representatives? A. To some degree, yes. Q. You say *o some degree — A. I told Mr. Schwartz there would be a consulting fee in- volved and I explained the project to him and I also told Mr. Schwartz that I had represented these people and had done business with them for some period of time and that he would receive a consulting fee. Q. Did you tell Mr. Schwartz at any time prior to his going to that meeting that the purpose of the meeting was in a sense to fix him and to arrange for him to take care of matters in front of City Council? A. No, sir. A3317. Al2 phia is to firm up uh, what we consider to be a major investment here and uh the gentleman cares to make a major investment here because he seems to like Philadelphia, and he has been told that it would uh be in his best interest to have an investment, uh, in an area where he, uh, would like to take up rather permanent residence and Philadelphia is it. SCHWARTZ: Philadelphia is a nice city. Philadelphia has been on the move since 1952. And, uh, business climate in Philadelphia is good. A690. Wald continued: WALD: Uh, and we want to put one up. Now we know that there are problems inherent in any major construction, uh, in this city and any other city. What I am trying to do is take care of any po- tential problems long before they exist. We’re not breaking ground tomorrow morning. We can forsee certain problems such as, uh, uh, zoning and variances and this type of thing. . . municipal gov- ernment, how it effects those various things, but we don’t want to be faced with problems down the road. A691-92. Schwartz responded to this overture with a so- liloqguy on his own political power and importance. After explaining how close he was to the mayor’ and that he was “sort of a protege” of the mayor’s deceased father, who had been Chairman of the {[Democratic] party, Schwartz stated: SCHWARTZ: . . . Unfortunately then he died in 63. And I have been close to every chairman since. I am a member of the Democratic National Committee. I am a member of the State Committee. 7. There is no evidence that William Green, Philadelphia's then newly elected mayor, was ever involved in or knew of the transactions at issue. In fact, Criden described Green as “an All American boy”, A343, and advised Wald that it would be “a critical mistake” to approach him. A372. Al3 I am a member of the City Committee. A Ward Leader. I, uh, I have a ward — if you know what that means in politics. A693. A few minutes later, Wald asked: WALD: Is it fair to say that by doing business with you, uh. . . my zoning problems become... . SCHWARTZ: Right. CRIDEN: You, you don’t have any. WALD: Okay. Now. There are what, 17 mem- bers, as, as you say. . . and also what uh I read here. . . SCHWARTZ: Right. WALD: Uh, do we have a uh controlling vote ‘SCHWARTZ: Yes. WALD: . . . problem here? SCHWARTZ: No... WALD: Uh. SCHWARTZ: No. WALD: Can you control. . . ‘WALD: . . . those types of factions? SCHWARTZ: Yes. WALD: You can control them? SCHWARTZ: The proof was today. The proof was the election of myself as president again. WALD: Uh hmm. SCHWARTZ: In other words, we got uh five or six now [sic] members that came in. Uh, you tell me your birth date. I'll give them to you for your birthday. A695-6. The essence of Schwartz’ representations of control was repeated shortly thereafter: WALD: All right. You’re controlling the coun- cil at this point. Al4 SCHWARTZ: Right. WALD): As far as I’m concerned. SCHWARTZ: Right. CRIDEN: Right. And has been for. . SCHWARTZ: Right. Right. WALD: Should we have anything that comes up to a vote, that has to be done on a vote basis, the council is with you. SCHWARTZ: Yes. WALD: You control them at this point. SCHWARTZ: Yes. Yes. Yes. CRIDEN: 100 percent. SCHWARTZ: Yes. A709. Schwartz stated that although he could not prom- ise that the hotel project would not have problems, those problems would not be “insurmountable” as long as the project “is a proper project.” A698. Wald stated, “I am not putting up a cathouse”, Criden interjected, “It’s go- ing to be legitimate”, and Schwartz responded, “That I take for granted, or I wouldn’t be here.” A710. Wald then asked Schwartz for assurances of his support if the project “violates some minor. . . type statute or ordi- nance or. . . something”, and Schwartz replied: SCHWARTZ: There is a Board of Building Standards. There, there is built-in relief every stage of the way. There’s a Zoning Board of Adjustment for variances. WALD: Okay. Can you control that? SCHWARTZ: Yes... . A711. Immediately thereafter he explained, “if it isn’t something that is outlandish, if it is something that should and can be handled, and I can, I can’t think of anything that couldn’t be handled. . . [t}hrough a vari- ance procedure of some kind.” A712. Wald stated: WALD: Okay. Meaning that, if City Council has to vote on it, we don’t have a problem at this point? Al5 SCHWARTZ: Well, I’m going further. There are other boards and agencies, uh, depending upon what your client, how idiosyncrant he wants to be and how eccentric he wants to be. WALD: (Laughter) ... They can become rather eccentric. SCHWARTZ: All right. All right. It may be necessary to go to these various boards and commis- sions. Now, they are part of the organization. They are part and parcel and. . . WALD: Appointed, appointed officials? SCHWARTZ: Yes, they are appointed officials. Uh, but uh, as I say, uh, I always do my homework. And, uh, the mayor is a very strong mayor. We have a strong mayor form of government. And all these people are his appointees. My understanding with him is that I go to him — period. I don’t even have to go to one of the flunkies, one of the functionaries. I gotohim.... A712-13. After additional discussion which concerned local law firms that could be employed by ‘the hotel project, the economic climate in Philadelphia, and the encouragement received by business from the city, Wald referred to Schwartz’ compensation: WALD: Our time frame is growing short, but we don’t have those type of problems. We don’t have that built-in resentment. Ah. . . We've talked to Howard, you know, the figures, the dollars we're talking are in the right ballpark. We're. . . SCHWARTZ: That’s not my prime concern. I'm interested in the City of Philadelphia. I’m inter- ested in a good project. I’m interested in tax rateables. I want to see Center City develop. Espe- cially Center City. There are a few parcels left. Well anything else that’s going to add to the tax rateables of the city that’s going to create jobs. Al6é WALD: I am again quick to say that I’m not really interested in the City of Philadelphia to be candid. SCHWARTZ: Well | have to be. I have to be. WALD: Perhaps, oh sure. . . (inaudible) CRIDEN: Your primary concern is to see that if your employer decides to move, you have a mini- mum amount of problems. WALD: Exactly. . . . Problems are to be han- dled before they arise. Right. Should any minor problems come up. Should any problems that are councilmatic in scope. . . SCHWARTZ: No problem. WALD: You could take care of them. Those are the type of things. . . SCHWARTZ: Right. WALD: That he asks I make an unequivocal, yes, it’s been handled, it’s been taken care of and uh ‘CRIDEN: You make that an unequivocable yes. SCHWARTZ: It’s. . . I would say to you that it’s much easier now than it is than it was four years ago. A746-47. The conversation returned to the nature of the understanding: SCHWARTZ: There are administrative escape hatches for everything in the City of Philadelphia under our various codes. There’s a way of doing it — administrative way of doing it. WALD: Okay, and that is the type of thing you can handle for us. SCHWARTZ: Oh yeah, right. WALD: I can go back and say I met a gentle- man. We had a business deal uh, I've made a friend in Philadelphia. Al7 SCHWARTZ: Yes. WALD: And things are taken care of. . . SCHWARTZ: Right. . . WALD: Okay, and the sums appropriate and we're in good shape. Okay. A753-54. Shortly thereafter as seen on the videotape, Wald opened his briefcase and, without discussion of the amount, handed Schwartz an envelope [containing $30,000 cash], which Schwartz placed in his jacket without counting. The nature of the commitment Schwartz made was reiterated: WALD: The legislative problems we've taken care of? CRIDEN: No problem. WALD: Okay, that | can, that I, that I got as- surance on. SCHWARTZ: Right. CRIDEN: You have, you have no problem. WALD: Okay, the other things can be done through attorneys, but the legislative problems don’t exist anymore? CRIDEN: That’s right. SCHWARTZ: No. Do not. WALD: Okay. A756. Criden remained behind and received his $5,000 fee for arranging the meeting. A758. He admitted to Wald that he had to give “something” to someone to make the approach to Schwartz. A763. Wald indicated an interest in talking to Jannotti if he was “amenable” because both Criden and Johanson hed referred to Jannotti “as a power.” A770. Criden undertook to ascer- tain to “try to do something” with Jannotti and “if the an- swer is no, I’m going to tell you right off the bat, forget it.” A778. They discussed the amount of the payment to Al8 Jannotti, Wald asking “Will he run with five” and Criden replying “Maybe ten. . . [L]et me run it up the flag pole with him.” A779-80. Wald asked whether he should deal with anybody else on the executive side and was told that there was no one else he could or should do busi- ness with. Criden promised to communicate with Wald the next day and departed. The next evening, January 24, 1980, following tele- phone arrangements, Jannotti and Criden arrived at the Barclay suite to meet with Wald and Haridopolos. Jannotti had been briefed by Criden and Schwartz earli- er that day who had “explained the whole situation.” A848. With Jannotti, as with Schwartz, Wald explained “I’m only here for one reason, to bring back some assur- ances.” A849. He continued: WALD: [W]e are prepared to make a major in- vestment in this city, alright, and, ah, we have in- credible funding but it’s still a major investment even for the people that I represent at this time. Ah, it’s not a drop in the bucket even for them. It’s a fair amount of money and ah, the way these people do business, is somewhat different than the way we do business in this country, they don’t think. They just can’t tolerate nor can they put up with psychologi- cally any problems that arise. Now these type of problems do arise but they can be handled, but the type of problems that would get back to my employ- er. Ahe, he can’t deal with them, and he turns to me and says I thought we had all this settled in Phila- delphia. So, that’s why I’m here, simply to take care of any problems now. JANNOTTI: Far in advance. WALD: Ah, it’s really not that far | don’t think. CRIDEN: Well. . . WALD: But at least enough in advance that ah when the time comes it’s over and done with every- thing is nice. Ah, those problems are simply the Al9 ones that I can forsee and you haven't come up with anymore than you and I had been worried about nor has the other gentleman I dealt with, and that would be ah, ah, the zoning, any variances that we have to obtain any, ah, committee type things we’d would have to, ah, deal with, with City Council ah, inspections, licensing the whole gamut, ya know the whole thing, well vou were in that type of busi- ness in, in an allied situation and I’m sure you can appreciate the petty things that arise, ah, that have to be handled. JANNOTTI: First of all you, you're going to in- vest a substantial amount of money and, ah, what you'll be doing is bringing into the City of Philadel- phia a substantial amount of money, and this will create jobs, will create a tax base and ah from what I gather everything that you want to do with be strict- ly, ah, on board. I mean there’s nothing phony about it. WALD: It’s a legitimate operation. JANNOTTI: As long as it’s, long as it’s a legiti- mate, legitimate operation. Ya know, any legitimate operation we will fight for because, ah, ya know why shouldn’t we fight for a legitimate operation? If the operation is legitimate, it’s going to bring a tax base into the City of Philadelphia, it’s going to bring em- ployment into the City of Philadelphia, ah, this is, this is basically our job, ah George George’s job and my job, ah, to try to get as much money into the City of Philadelphia and as many jobs into the City of Philadelphia as we possibly can. A849-51. Wald asked: WALD: [Bly dealing with you here this eve- ning and, and the gentleman I, I spoke with last evening, can I go back with those assurances? JANNOTTI: I don’t see why not, as you say, ya know it’s a legitimate project and you have your fi- A20 nancing, there’s nothing ah, there's nothing that you're doing illegal. . . CRIDEN: Michael wants to be sure that he has a friend if he has a problem. JANNOTTI: Oh certainly. WALD: If something arises, if something arises that needs a City Council vote to be very spe- cific, a City Council vote is needed on the thing, can I count on your vote? JANNOTTI: Why sure. . .. first of all we'll go over it again, you have a legitimate project, ah, you're going to invest 36 million dollars in the City of Philadelphia, which is going to create a tax base and going to create employment. WALD: Right, but. JANNOTTI: But ya, but. HARIDOPOLIS: A lot of legitimate, ah, things get bogged down, we don’t want to be bogged down. JANNOTTI: No, I can't see this being bogged down. A853-54. Wald explained his position: WALD: Let me give you a short insight into the Arab mind, that its ah, it’s at times difficult to understand now, ah, I can appreciate it because I’ve had both worlds and I can relate, ah, you know, you folks are here, right, they, they think differently, they deal differently, their psychological process are alien to the way I understand exactly what you're saying. Ok. I’m coming up with something that’s going to help the City of Philadelphia. Ah, it would help, as it would help any city. Ah, he does not look on it that way. They do business, differently. They pay the freight up front. They make friends, right, and then when there, there is a potential problem then I don’t mean, I don’t mean a problem that would necessarily close down construction and throw the project out of Philadelphia. A21 A855-56. Wald and Jannotti discussed City Council politics, and Jannotti affirmed Criden’s statement that Council “never had a vote on an issue that George and Harry wanted passed that they'd lost in the last two years.” A859. They then discussed the payment to Jannotti: WALD: But, you were here at the time. You convinced me right off the bat that we were in the right city and we would have no problems. CRIDEN: You will have no problems. WALD: And I would just as soon save the money, but I can’t go back. CRIDEN: I understand, we _ had that discussion. WALD: (Pointing to Criden) Did he, was he very graphic with ya? JANNOTTI: Yes. WALD: On exactly how. . . JANNOTTI: (Nodding yes) He was always up front, up front. WALD: Ok and... CRIDEN: To the bottom line, you know me Michael, I, I don’t we, we both do everything right up front. WALD: Ok and, alright, then I’m going to be, then I’m going to be up front with ya. I'm. CRIDEN: Exactly. WALD: Ah, you've been in business all your life, you’ve as you said, you got an education 20 years behind the bar, I was sent to Philadelphia to pay for certain things because that is the psychology and that is the method of business that these people are use to, and that is how they conduct business, they conduct with everybody they do. That’s why I'm here. I understand their psychology, I’ve been involved with them long enough, ah to make it a major part of my life, a majority of my life. A22 JANNOTTI: Well, you know ah, just just on the basics, of what you said and what they want to do, it’s enough for me to get on the floor and argue. I don’t have to, even care what else they want to come up with. My basic point is, the fact that, ah what’s coming in here, and this has been our job, to bring as much business and and, and ah tax base and em- ployment to the City of Philadelphia. If that’s the way they want to do business, that’s all right too. A859-61. Wald asked again for “assurances”: WALD: Can I go back, ah ah, to my employer, the Sheik and tell him that I dealt with a man, on Wednesday night tell him who he is, dealt with you, Thursday night, explain who you were, what your position is and say he and I conducted a cash busi- ness transaction and he guaranteed me, we don’t have a problem in Philadelphia. We ah, ah City Councils on our side the man has the influence with the Finance Committee, he has influence. . . JANNOTTI: You wouldn't, you wouldn't be able to say we don’t have a problem. Problems might arise, but problems ah, you might say problems can be solved. WALD: Ok, you can handle those problems we presume. JANNOTTI: I don’t see why not if it’s a legiti- mate, if it’s a if it’s a legitimate if it’s a, if it’s a legiti- mate enterprise, it’s a legitimate piece of business. WALD: By making friends with you this eve- ning, if we have to go to City Council and say look, ya know, give us a break, right, got us some legisla- tion that this is ok. That it’s in the right neighbor- hood, that the time. CRIDEN: If you want a street for example let's say changed from a two way to a one way ok, maybe that will help you. A23 WALD: Ok. CRIDEN: Handle your traffic pattern. JANNOTTI: We handle that everyday. WALD: But I go back and I'll say we have this, and I'll use that as an example that if we have a one way street situation and it’s just hurting the front, of, of the place we cannot move people in and out of the hotel limousines to private vehicles and what have you, ah the men I dealt with said they will help. I’m not saying that you could walk in there and change this thing tomorrow, but. CRIDEN: Yet. JANNOTTI: We'll go in there and battle, we'll go in and battle. WALD: You're with us? JANNOTTI: Certainly, we'll go in and battle. A863-67. Wald then took an envelope from his briefcase [containing $10,000 cash], handed it to Jannotti, and asked if “that amount is sufficient.” Jannotti took the en- velope, answering, “We've discussed it.” HARIDOPOLIS: You know how much it is? CRIDEN: Tell him, you can tell him. HARIDOPOLIS: How much is it? CRIDEN: Tell him? JANNOTTI: We won't even discuss it. WALD: Ok, but you did discuss it with Howard? JANNOTTI: We won't even discuss it. HARIDOPOLIS: Is this arrangement please, pleasing to you? JANNOTITI: As I say, we won't even discuss it. WALD: Ok, well, we've done our business. A884-85. Jannotti departed, and Criden promised to see him downstairs. A24 Il. HOBBS ACT CONSPIRACY In its opinion granting the motions for acquittal the district court noted that the “evidence permitted, al- though it did not compel, the inference that the pay- ments represented bribes paid in exchange for the de- fendants’ assurances of using their official positions to pave the way for expeditious completion of the project.” 501 F. Supp. at 1184. The court, however, dismissed Count III of the indictment, the Hobbs Act conspiracy count, for two reasons. The first dealt with the fictitious nature of the scheme. Although the court was willing to assume that the “evidence permitted the jury to con- clude that, if the project had in fact been a genuine project, it would have required the movement of articles in interstate commerce, and that the payment of these bribes would have affected such commerce by depleting the funds available for carrying out the project,’ the court focused on the fact that “there never was any such planned project. The Arabs, their plans, and their money were all entirely fictitious.” Id. The court concluded: While the jurisdictional reach of the Hobbs Act is undoubtedly extensive, touching conduct having only minimal or potential impact upon commerce (broadly defined), it does not operate to confer fed- eral jurisdiction over purely hypothetical potential impacts on commerce which could never occur. Id. at 1185. The district court thus fashioned a require- ment that conviction for conspiracy to violate the Hobbs 8. In charging the jury on the Hobbs Act count. the court in- structed that it must find that “a natural and probable consequence of the extortion, the receiving the money. would have been to affect interstate commerce” and that the Government position was that the receipt of the payments of $30,000 and $10.000 would have had an effect on interstate commerce. A1344-45. A25 Act requires an actual potential effect on interstate commerce. The second jurisdictional defect, according to the district court, stemmed from its view that the Hobbs Act does not cover the “passive acceptance of gratuities by public officials.” Id. The district court, after noting that defendants did not request payment and “made it very clear that the payments would not be necessary”, found that the convictions would represent “a substantial stretching of the definition of extortion.” Id. A. Effect on Interstate Commerce The broad ianguage of the Hobbs Act, covering any- one who “in any way or degree. . . affects commerce . . . by. . . extortion or attempts or conspires so to do . . .”, 18 U.S.C. §1951,° demonstrates Congress’ intent to free interstate commerce from burdens of any kind caused by extortion. The Supreme Court has expressly recognized that the statute manifests a congressional purpose “to use all the constitutional power Congress 9. The Hobbs Act reads in pertinent part as follows: Whoever in any way or degree obstructs, delays, or affects commerce or the movement of any article or commodity in commerce, by robbery or extortion or attempts or conspires so todo. . . shall be fined not more than $10,000 or imprisoned not more than twenty years, or both. 18 U.S.C. §1951(a). The statute defines “commerce” as commerce within the District of Columbia, or any Territory or Possession of the United States; all commerce between any point in a State, Territory, Possession, or the District of Colum- bia and any point outside thereof; all commerce between points within the same State through any place outside such State; and all other commerce over which the United States has jurisdiction. 18 U.S.C. §1951(b)3). A26 has to punish interference with interstate commerce " Stirone v. United States, 361 U.S. 212, 215 (1960). Accord, e.g., United States v. Cerilli, 603 F.2d 415, 423 (3d Cir. 1979), cert. denied, 444 U.S. 1043 (1980). See also United States v. Culbert, 435 U.S. 371 (1978); United States v. Green, 350 U.S. 415, 420-21 (1956). In United States v. Staszcuk, 517 F.2d 53, 58 (7th Cir.) (en banc), cert. denied, 423 U.S. 837 (1975), the court concluded that “the purpose of the Hobbs Act parallels the central purpose of the Commerce Clause itself.” Thus, the decision of the district court in this case has application beyond the Hobbs Act because the extent of Congress’ power under the commerce clause is implicated, and, if its analysis is accepted, will have ramifications for all federal criminal statutes enacted un- der Congress’ commerce clause power. We begin the analysis of Congress’ power to regu- late interstate commerce with the now-accepted princi- ple that the commerce clause reaches, inter alia, activi- ties affecting interstate commerce. Perez v. United States, 402 U.S. 146, 150 (1971); United States v. Dar- by, 312 U.S. 100 (1941). However, application of a fed- eral criminal statute is not limited to those cases in which an actual interstate effect is shown. Instead, as the Court recognized in Perez v. United States, 402 U.S. at 152-53, it is enough that the conduct falls within the “class of activities” within the reach of federal power. Schwartz and Jannotti were convicted of a conspir- acy to violate the Hobbs Act, rather than of a substantive violation of the Hobbs Act. A substantive violation of the Hobbs Act generally is supported by proof of an actual effect on commerce. See, e.g., United States v. Mazzei, 521. F.2d 639, 642 (3d Cir.) (en banc), cert. denied, 423 U.S. 1014 (1975). But see United States v. Staszcuk, 517 F.2d 53, 59-60 (7th Cir.) (en banc), cert. denied, 423 U.S. 837 (1975) (actual effect need not be shown; “realistic probability” of effect is sufficient). Defendants A27 argue that it follows that a prosecution for conspiracy to violate the Hobbs Act also requires proof “that com- merce must have been affected.” Brief for Appellee Jannotti at 22. In so arguing, defendants overlook the significant distinction between a conviction for a sub- stantive offense and a conviction for a conspiracy to commit the substantive offense. This distinction was recognized by the district court at an early stage of the litigation when it dismissed the substantive Hobbs Act counts of the indictment on the ground that there was no possibility that the bribe payments could actually have affected commerce, but left standing the conspir- aey count on the possibility that federal jurisdiction could be grounded on proof that the conspiracy, if com- pleted, would affect commerce. See 501 F. Supp. at 1184. The subsequent dismissal of Count III of the in- dictment was apparently grounded on the district court's changed view of the law that an actual potential effect was required, even for a conspiracy conviction. We be- lieve the district court’s earlier view was the correct one Because an agreement between two or more per. sons to commit criminal acts poses, in and of itself, a sc rious danger to social order, it is proscribed by the law of conspiracy. See Callanan v. United States, 364 U.S. 587, 593 (1961). The ultimate failure of the conspiracy may diminish, but does not eliminate, the threat it poses to social order; therefore, the illegality of the agreement does not depend on the achievement of its ends. See gen- erally United States v. Shoup, 608 F.2d 950, 957 n.13 (3d Cir. 1979); United States v. Bobo, 586 F.2d 355, 371 (5th Cir. 1978), cert. denied, 440 U.S. 976 (1979). It is similarly irrelevant that the ends of the conspiracy were from the very inception of the agreement objectively unattainable. United States v. Waldron, 590 F.2d 33 (1st Cir.), cert. denied, 441 U.S. 934 (1979) (conviction for conspiracy to transport stolen goods in excess of $5,000 affirmed, even though, unknown to defendants, A28 property transported was worth less than $5,000); Unit- ed States v. Thompson, 493 F.2d 305 (9th Cir. ), cert. de- nied, 419 U.S. 834 (1974) (defendant can be convicted of conspiracy to smuggle marijuana even though sub- stance was not shown to be marijuana). In this case the defendants agreed to do acts which, had they been at- tainable, would have affected commerce. At that point, regardless of whether an actual effect on commerce was “reasonably probable,” a sufficient federal interest was implicated to support federal jurisdiction over that agreement. The Hobbs Act, by its own terms, encompasses the inchoate offenses of attempt and conspiracy to extort. Convictions for these offenses have been sustained not- withstanding the absence of any evidence of an actual effect on interstate commerce. In United States v. Rosa, 560 F.2d 149, 153 (3d Cir.) (en banc), cert. denied, 434 U.S. 862 (1977), a case in which there was no effect on commerce because the “victim” refused to pay the extor- tion demand, we stated that a defendant may be convict- ed under the Hobbs Act for an “attempted extortion which would, if the act were completed, have the effect of obstructing commerce.” See also United States v. Bellomini, 454 F. Supp 44, 47 (W.D. Pa. 1978) (“The fact that the business enterprise was frustrated at a later date through failure of finances does not constitute a de- fense to a charge of attempt to extort money in violation of the Hobbs Act.”). Similarly, in United States v. Caci, 401 F.2d 664 (2d Cir. 1968), vacated on other grounds, 394 U.S. 310 (1969), the Second Circuit sustained the conviction of defendants for conspiracy to rob an armored car messenger in violation of the Hobbs Act al- though the plan was aborted. Counsel for defendants conceded at oral argument that they could point to no precedent to support their contention that a conviction for conspiracy to violate the Hobbs Act must be predicated on a showing of an actual A29 or probable future effect on interstate commerce. One of the few cases to focus on the interstate commerce aspect of the Hobbs Act, United States v. Staszcuk, 517 F.2d 53 (7th Cir.) (en banc), cert. denied, 423 U.S. 837 (1975), arose when a local alderman was convicted of a substan- tive Hobbs Act violation. The government had proven that he received $3,000 and that he did not oppose a zoning change which authorized the construction of an animal hospital. Because no such hospital was ever built, the court noted that “there is no evidence that ei- ther the zoning change or the payment had any effect whatsoever, either favorable or unfavorable, on inter- state commerce.” Id. at 55. Judge, now Justice, Stevens, writing for a majority of the en banc court, considered whether the federal statute reached extortion under those circumstances, and concluded: “We are. . . per- suaded that the cases which uniformly hold that a threatened effect on interstate commerce is sufficient to bring the statute into play notwithstanding the absence of any actual effect, correctly interpret the congressional purpose.” Id. at 59 (emphasis added). We believe Justice Stevens’ approach is dispositive of the jurisdictional issue before us. Congress can con- stitutionally reach inchoate offenses because these offenses pose a potential threat to interstate commerce; the existence of such a threat ties “the proscribed con- duct to the area of federal concern delineated by the stat- ute.” United States v. Feola, 420 U.S. 671, 695 (1975). The appropriate inquiry then is not whether the defen- dants’ perceptions can invest the courts with federal ju- risdiction, as the district court viewed the issue, but whether the defendants’ conduct constituted a sufficient threat to interstate commerce so as to implicate an “area of federal concern” sufficient to give rise to federal jurisdiction. In essence the defendants are arguing that we should accept an impossibility defense when federal ju- A30 risdiction is predicated on interstate commerce. We be- lieve such a defense must be rejected here. In substan- tive Hobbs Act convictions, the requisite nexus to interstate commerce has been found in the depletion of assets theory, because the payment of an extortion de- mand may reduce the assets available for the purchase of goods originating in other states. See, e.g., United States v. Cerilli, 603 F.2d 415, 424 (3d Cir. 1979), cert. denied, 444 U.S. 1043 (1980) United States,.v. Addonizio, 451 F.2d 49, 77 (3d Cir. 1971), cert denied., 405 U.S. 936 (1972). In United States v. Rindone, 631 F.2d 491 (7th Cir. 1980), the Hobbs Act conviction of a municipal inspector who had extorted money in ex- change for work permits was challenged on the ground that there was no nexus with interstate commerce under the depletion of assets theory because the Federal Bu- reau of Investigation had supplied the money used in the extortionate transaction. In rejecting this claim, the court reviewed Hobbs Act cases which upheld jurisdic- tion although no depletion of assets affecting interstate commerce had or could take place and affirmed the “fed- eral interest in deterring even futile threats to interstate commerce”, 631 F.2d at 493, referring to United States v. Staszcuk, 517 F.2d at 57. The Rindone court concluded: As the court noted in [United States v. Brooklier, 459 F. Supp. 476 (C.D.Cal. 1978)], “|t]his extortion completed a plan that would have actually affected commerce but for a fact unknown to defendants, i.e., that [the victim] was a company not actually en- gaged in commerce.” Id. at 478. The presence here of a fact not known to Rindone, i.e., that the FBI provided the payoff money, is likewise irrelevant to the jurisdictional inquiry. 631 F.2d at 494. In the Brooklier case, relied upon by the Seventh Circuit, the victim corporation was an F.B.I.-created shell that in fact had no interstate deal- A31 ings. Jurisdiction under the Hobbs Act was nonetheless upheld. In construing other federal statutes, the courts also have expressed an unwillingness to accept impossibility as precluding jurisdiction. In United States v. Rose, 590 F.2d 232 (7th Cir. 1978), cert. denied, 442 U.S. 929 (1979), two defendants who had agreed to burglarize a home in Arizona and to transport the stolen goods to IlIli- nois, unwittingly engaged F.B.I. agents to perform the theft and to transport the goods. The agents never in- tended to commit the thefts and no goods were ever sto- len; instead the defendants were arrested and convicted of conspiracy to transport goods interstate knowing the goods to be stolen. Although the issue of federal jurisdic- tion was not expressly raised, the court, in affirming the convictions under 18 U.S.C. §§371, 2314, commented: Here [defendants] intended to cause the goods to be stolen and then transported in interstate commerce with knowledge that they had been stolen. All that was necessary, in addition to an overt act, was that the intended future conduct they had agreed upon include all the elements of the substantive crime. 590 F.2d at 235. This statement reflects the court’s view that the defendants’ plan to transport the goods inter- state, even though unattainable from the outset, suffi- ciently impinged on an area of federal concern to justify federal regulation and prohibition. See also Craven v. United States, 22 F.2d 605, 609 (1st Cir. 1927), cert. de- nied, 276 U.S. 627 (1928) (conviction for conspiracy to import foreign liquor without payment of tariff can be sustained based on defendants’ erroneous beliefs that liquor was of foreign origin). Defendants have argued that the holding in United States v. Feola, 420 U.S. at 695-96, supports their view that an essential jurisdictional element cannot be estab- A32 lished by reference solely to the state of mind of the de- fendant. Feola provides no support for the defendants’ theory. In Feola, even though the defendants did not in- tend to assault a federal officer, the Court held that they could be still convicted for conspiring to violate the fed- eral statute, 18 U.S.C. §111, which prohibits an assault on a federal officer. In holding that there was a “suffi- cient threat” to an “area of federal concern” to meet the federal jurisdictional requirement as long as a federal of- ficer was in fact the target of the planned attack, 420 U.S. at 695, the Court did not preclude the existence of federal jurisdiction where the intended victim is be- lieved to be a federal officer, but in fact is not. In fact, the language in the Feola opinion and the approach taken by the Court there support our final rea- son for rejecting the district court’s holding that an actu- al potential effect on interstate commerce is a jurisdic- tional prerequisite for a conviction for conspiracy to violate the Hobbs Act. Defendants have been able to of- fer this court no policy reason for us to accept their re- strictive view of Congress’ constitutional power to legis- late as to conspiracies which pose a threat to interstate commerce. Defendants agree that had the government moved from the verbal ruse that its agents were in the hotel construction business to the more concrete action of embarking on that venture, see United States v. Gambino, 566 F.2d 414 (2d Cir. 1977), cert. denied, 435 U.S. 952 (1978), the jurisdictional requirement would have been met. However, we see no reason to interpret Congress’ legislative power as dependent upon whether the F.B.I. agents actually contract for a hotel site, pur- chase machinery to dump garbage, or establish their own fencing operation for the purchase of stolen goods. To require that the government take that additional step before it can constitutionally reach a proven conspiracy which would have affected interstate commerce had the facts been as represented misdirects the focus of the conspiracy cases. As the Court noted in Feola, “|T|he A33 law of conspiracy serves ends different from, and com- plementary to, those served by criminal prohibitions of the substantive offense.” 420 U.S. at 693. The Court identified the dual purposes of conspiracy law, “protec- tion of society from the dangers of concerted criminal ac- tivity,” and sanctions against those agreements which pose great likelihood of commission of an act due to well formed criminal intent. Id. at 693-94. In this case the jury found that the defendants con- spired to violate the Hobbs Act by their acceptance of payments in return for their promises to expedite com- pletion of an elaborate hotel project which, had it been constructed, would have entailed at least a $30 million expenditure. Had the project actually been planned as represented, defendants’ actions would have violated the Hobbs Act even if unforeseen difficulties, such as the overthrow of the “sheik”, prevented any further action on the project. The federal interest in protecting inter- state commerce is no less under the factual situation presented in this case. The threat posed by defendants’ actions is just as great. Since Congress has exercised the full scope of its commerce power in the Hobbs Act, we conclude that there was Hobbs Act jurisdiction. B. Extortion “Under Color of Official Right” As an additional ground for dismissing the Hobbs Act count the district court held that defendants’ con- duct did not constitute “extortion” under the Act be- cause they, at most, “passive[ly]” accepted the bribes. 501 F. Supp. at 1185. The Act defines “extortion” as: the obtaining of property from another, with his consent, induced by wrongful use of actual or threatened force, violence, or fear. or under color of official right. A34 18 U.S.C. §1951(b)(2). The district court's holding is inconsistent with the rationale underlying the holdings of this court that the Act is disjunctive and proscribes the “obtaining of prop- erty from another . . . under color of official right,” without proof of coercion by the defendant. United States v. Kenny, 462 F.2d 1205, 1229 (3d Cir.), cert. de- nied, 409 U.S. 914 (1972). We reaffirmed this principle in United States v. Mazzei, 521 F.2d 639 (3d Cir.) (en banc), cert. denied, 423 U.S. 1014 (1975), where we stated: A violation of the statute may be made out by show- ing that a public official through the wrongful use of office obtains property not due him or his office, even though his acts are not accompanied by the use of “force, violence or fear.” Id. at 645 (citations omitted). In Mazzei, we observed that “the ‘under color of official right’ language [of the Hobbs Act] ‘repeats the common law definition of extor- tion.’ ” Id. (citation omitted). At common law, extortion was defined as “any officer’s unlawfully taking, by color of his office, from any man, any money or thing of value that is not due to him.” 4 W. Blackstone, Commentaries *141. The requirement that the money be taken “by col- or of his office” meant “simply that the officer must have taken money not due him for the performance of his offi- cial duties.” State v. Weleck, 10 N.J. 355, 372, 91 A.2d 751, 759 (1952). Thus, “[i]f the [Hobbs] Act is read in full, the distinction between bribery and extortion be- comes unnecessary where public officials are involved.” Stern, Prosecutions of Local Political Corruption Under the Hobbs Act: The Unnecessary Distinction Between Bribery and Extortion, 3 Seton Hall L. Rev. 1, 14 (1971). More recently, in United States v. Cerilli, 603 F.2d 415 (3d Cir. 1979), cert. denied, 444 U.S. 1043 (1980), we upheld the conviction of state officials who received bribes in return for conferring valuable state A35 contracts, and approved the district court’s charge that extortion under “|cJolor of official right is defined as the taking by a public official of money not due him or his office... .” The holding in our cases that the Hobbs Act covers the acceptance of bribes by public officials even when payment was not obtained by force, threats, or use of fear, and the further suggestion that there need be no inducement or prior request for such payments, accords with the view taken by other courts of appeals. In United States v. Hedman, 630 F.2d 1184 (7th Cir. 1980), cert. denied, 450 U.S. 965 (1981), the government proved at trial that defendants, city building inspectors, accepted money from builders who failed to conform with the building code, but no solicitation of the bribes was shown. In rejecting defendants’ argument that the gov- ernment must show that the officials were the “initiators” or “inducers” of the alleged payments, the court stated: It is settled law in this Circuit as well as others that in a Hobbs Act prosecution for extortion under color of official right it is unnecessary to show that the de- fendant induced the extortionate payment. . . The Government is merely required to prove that a public official obtained money to which he was not entitled and which he obtained only because of his official position. Id. at 1195 (footnote omitted). The Sixth Circuit has also held that the “technical overdrawn distinction” which the public officials sought to make there between brib- ery and extortion under the Hobbs Act is not in keeping with the legislative intent, and that “in cases of misuse of official power, bribery and extortion are not mutually exclusive.” United States v. Butler, 618 F.2d 411, 417 (6th Cir. 1980), cert. denied, 447 U.S. 927 (1980) and 449 U.S. 1089 (1981). A36 Defendants argue that in each of the cases in which this court seemed to interpret the Hobbs Act to cover passive acceptance of a bribe by a public official, the de- fendant had in fact engaged in some conduct which could be construed as inducement of the payment. Even if the Hobbs Act were to be construed as requiring some inducement on the part of the public official, defendants’ conduct in this case hardly constituted merely passive acceptance of the payments. The evidence does not fit the defendants’ posited illustration of an unexpected bribe mailed to a public official’s office. On the contrary, rather than remaining in their own offices, the evidence shows that each defendant arrived at the Barclay suite after having been briefed about the purported hotel project, the fact that there would be a payment made, and the specific amount of the payment which would be made to each. Although there is no verbatim record of Criden’s earlier conversation with Schwartz, Criden re- ported to Wald that he told Jannotti before the January 24th meeting that the hotel builders wished assurances that there would be no municipally imposed obstacles to the project, and that the builders were willing to pay for such assurances. A897. As soon as each defendant was in the Barclay suite, Wald, the F.B.I. agent, promptly re- peated the need for such assurances. Thereafter, Schwartz launched into a discourse on his own impor- tance and power and his ability to control City Council and the relevant municipal officials and departments, A692-96, 709-13, see pages 13-16 supra, and Jannotti also confirmed his own power. A858-59, see page 21 supra. Further, each gave assurances that there would be no obstacles or that the obstacles, if any, would be manageable. Thus, each defendant’s appearance at the Berclay in expectation of a payment and his conduct in providing such assurances evidences more than mere “passive” acceptance of the bribes,'° and falls wit’1in the 10. The district court's statement, without citation to [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385008_1572%3A0. Public record. Not legal advice.