Petition for Writ of Certiorari — Lisinski v. United States

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= FILED

83-2072 JUN 4 $094

as E ? . STEVAS,

IN THE

SUPREME COURT OF THE UNITED STATES

October Term, 1983

DEAN J. LISINSKI, Petitioner

UNITED STATES OF AMERICA, Respondent

PETITION FOR A WRIT

OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

Thomas D. Decker

Thomas D. Decker &

Associates, Ltd.

135 South LaSalle St.

Suite 853

Chicago, IL 60603

(312)263-4180

Counsel for Petitioner

QUESTIONS PRESENTED

FOR REVIEW

1. Whether the Hobbs Act, 18

U.S.C. § 1951, is violated when fear of

economic harm motivates payments of

money, but the recipient has not threat-

ened the payor, directly or indirectly.

2. May the Petitioner's engagement

as an agent of the "victim" in a bribery

scheme, unaccompanied by extortionate

conduct toward the victim, constitute a

violation of the Hobbs Act?

TABLE OF CONTENTS

Table of Authorities. ......

Gpinion Below . . «++ ++ se «

WMRABGSGCIOR. «6 2 ts bt tw et et

Statute Involved. ....... -»

Statement of the Case ......

Reasons For Granting The Writ...

I. Certiorari Should Be

Granted Because The

Opinion Below Conflicts

With This Court's Con-

struction Of The Hobbs

i. = * & 6 & © &@ © «© e

II. Certiorari Should Be

Granted To Resolve The

Conflict Created By This

Case With Lower Court's

Interpretations Of The

Hobbs Act Requiring

ee ee ee

Livingston v. Lisinski. .

Lisinski v. Other

SS ee

III. Certiorari Should Be

Granted Because The

Hobbs Act's Legisla-

tive History Indicates

That The Defendant Must

Threaten The Victim...

IV. Certiorari Should Be

Granted Because The

Statutory Interpreta-

tion By The Seventh

Circuit Violates This

Court's Delineation

Between Federal and

State Criminal Juris-

Gaweeee Ga-« 2/6 -s © -« 31

V. Certiorari Should Be

Granted Because The

Hobbs Act Does Not

Criminalize A Bribery

Scheme In Which The

Defendant Acted As An

Agent Of The Payor. ... 36

Cemeeeeaee., « 6 64: «4-64 8 ew *% Se 6 40

Appendix

iii

TABLE OF AUTHORITIES

CASES

Callanan v. United States,

223 F.2d 171 (8th Cir.),

cert. denied, 350 U.S. 862 (1955).

H.K. borter Co. v. NLRB,

397 U.S. 99 (1970) . 2. ~~ 2 ws

Palko v. Connecticut,

ain Lee Sens «6 © & 6 64s

People v. Dioguardi,

8 N.Y.2d 260, 203 N.Y.S.2d

870, 168 N.E.2d 683 (1960) ....

People v. Weinseimer,

Il7 App. Div. 603, 102 N.y.S. 579,

aff'd, 190 N.Y. 537, 83 N.E.

Bee eeeree- 6.5 #68 6 8 0 8 8s

Rewis v. United States,

401 U.S. 808 (1971). . . 2. 2. 2s .

United States v. Bass,

404 U.S. 366 (1971). . . 2...

United States v. Billups,

692 F.2d 320 (4th Cir. 1982), cert.

denied, U.S.

Sue Bs Ges OC (1983). Sy ee ee sa ee

United States v. Brecht,

540 F.2d 45 (2d Cir. 1976),

cert. denied, 429 U.S. 1123 (1977)

United States v. Cerilli,

603 F.2d 415 (3rd Cir. 1979), cert.

denied, 444 U.S. 1043 (1980)... .

Page

21,

25,

20,

32,

24,

United States v. Crowle

504 F.2d 992 (7th Cir. +574) ;. *«

United States v. Duhon,

565 F.2d 345 (5th Cir.),

cert. denied, 435 U.S. 952 (1978).

United States v. Enmons,

SiG UoB. 396 CA97S). « 2 2 2 2 et

United States v. Gerald,

624 F.2q 1291 (5th Cir. 1980),

cert. denied, 450 U.S. 920 (1981).

United States v. Green,

350 U.S. 415 (1956). .......

United States v. Hathaway,

534 F.2d 386 (ist Cir.),

cert. denied, 429 U.S. 819 (1976).

United States v. Hyde,

448 F.2d 815 (5th Cir. 1971),

cert. denied, 404 U.S. 1058 (1972)

United States v. Kubacki,

237 F. Supp. 638 (E.D. Pa. 1965) .

United States v. Livingston,

8 @ > 8¢\ >) eae

United States v. Nardello,

ie = 2 Be.) ree

United States v. Porcaro,

648 F.2d 753 (lst Cir. 1981)...

United States v. Pranno,

385 F.2d 387 (7th Cir. 1967),

cert. denied, 390 U.S. 944 (1968).

passim

26,

36, 37

passim

36, 37

passim

36, 37

United States v. Quinn,

514 F.2d 1250 (5th Cir. 1975),

cert. denied, 424 U.S. 955 (1976).

United States v. Rabbitt,

583 F.2d 1014 (8th Cir. 1978),

cert. denied, 439 U.S. 1116 (1979)

United States v. Rastelli,

551 F.2d 902 (2d Cir.),

cert. denied, 434 U.S. 831 (1977).

United States v. Russo,

708 F.2d 209 (6th Cir.),

cert. denied, U.S. ___,

104 S.Ct. 487 (1983) .......

United States v. Sander,

615 F.2qa 215 (5th Cir.),

cert. denied, 449 U.S. 835 (1980).

United States v. Warledo,

Sa? Became tan ERUCH Cae. ADT7). »

United States v. Zappola,

OF? Fu.am 208 (am CAEtF 2 6 6 8 et

Williams v. United States,

G58 UsB. 279 (iFGEI. 2 2 eo te we ew

STATUTES

AO U.8.€. 9 O7e8 <5 t «© wo oe @ os

IG U.S.C. 9 L95E(D)(2) . - 2 2 ©

28 U.S.C. § 1254(1). . . . «© ww

OTHER AUTHORITIES

Black's Law Dictionary 85

[SGn O0. Bea). «+ « se ee eee

20, 21

hi, Se

20, 26

Passim

89 Cong. Rec. 3191-3234 (1943). .

91 Cong. Rec. 11899-922 (1945). .

91 Cong. Rec. 11900 (1945). .

H.R. Rep. 66, 78th Cong.,

Let Deis. CEOs i & w «

H.R. Rep. 2176, 77th Cong.,

an Geese thet «© © © « o

N.Y. Penal Law § 850,

McKinney (1944) ...... .

Report of the House Committee

the Judiciary, H.R. Rep. 238,

Cong., lst Sess., (1945)...

vii

No.

IN THE

SUPREME COURT OF THE UNITED STATES

October Term, 1983

DEAN J. LISINSKI, Petitioner

Vv.

UNITED STATES OF AMERICA, Respondent

PETITION FOR A WRIT

OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

The petitioner respectfully prays

that a writ of certiorari issue to

review the judgment and opinion of the

United States Court of Appeals for the

Seventh Circuit entered in this pro-

ceeding on February 21, 1984, affirming

the petitioner's conviction. The Court

of Appeals denied a timely petition for

rehearing on April 2, 1984. See Appendix

hereto, p. 13-14.

OPINION BELOW

The opinion of the Court of Appeals,

not yet reported, appears in the Appendix,

p. 1. The District Court ruled verbally

in convicting the petitioner. Transcript

of Proceedings ("Tr."), Nov. 12, 1982,

pp. 42-48, App. 15-29.

JURISDICTION

The judgment of the Court of Appeals

(App. 1) was entered on February 21,

1984. A timely petition for rehearing

was denied on April 2, 1984. App. 13-14.

The jurisdiction of this Court is invoked

under 28 U.S.C. § 1254(1).

STATUTE INVOLVED

18 U.S.C. § 1951. Interference with

commerce by threats of violence

(a) Whoever is any way or degree

obstructs, delays, or affects commerce

or the movement of any article or com-

modity in commerce, by robbery or extor-

=2=

tion or attempts or conspires so do to,

or commits or threatens physical violence

to any person or property in furtherance

of a plan or purpose to do anything in

violation of this section 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.

* + *

STATEMENT OF THE CASE

After a trial without a jury in the

United States District Court for the

Northern District of Illinois, the peti-

tioner, Dean Lisinski, was convicted

-3-

under three counts alleging violations

of the Hobbs Act, 18 U.S.C. § 1951.

11/11/82 Tr. 47-48. As to two of the

counts, the petitioner was convicted of

receiving funds from Louis Patras which

the lower courts found were paid out of

fear of economic harm. The third count

was founded on the same theory of economic

fear but, as the funds were furnished by

the government, the conviction was for

attempted extortion. App. 2-3.

The "victim" in the case was Louis

Patras, who testified he met the peti-

tioner in 1976 or 1977 and that they

became very good friends. 11/9/82 Tr.

56.

Mr. Patras had long worked in the

restaurant and bar business. There he

learned that by paying money he could

get things to which he was not entitled.

11/10/82 Tr. 158. The Trial Judge found

that Mr. Patras had a history of making

o4=

payoffs to accomplish his goals. 11/12/82

Tr. 43. In addition, Patras admitted

involvement in a series of criminal

frauds in the pertinent period of time.

11/10/82 Tr. 176-84, 198-202, 202-10;

11/9/82 Tr. 53-54.

In 1979 Mr. Patras was the operator

of the William Tell II restaurant in

Illinois. As such, it was his obliga-

tion to collect sales taxes from

customers and hold them in trust for the

State. Instead, he diverted the money

to other uses and fell behind in his

sales tax payments. 11/10/82 Tr. 195-

97. Because of this delinquency, Patras

expected that the agency responsible for

the collection of the taxes, the Illinois

Department of Revenue, would seek revoca-

tion of the restaurant's liquor license.

He also knew that he could cure the

problem by the payment of the back taxes,

id. at 219-20, 223, 235-36, and regarded

retention of the liquor license as essen-

tial to the economic viability of the

restaurant. 11/9/82 Tr. 49-52.

The Illinois Liquor Control Commis-

sion scheduled a hearing as to the liquor

license shortly before it was due to

expire in 1980. Id. at 59. Mr. Patras

knew the petitioner held a public office.

While the office was not concerned with

liquor licenses, Mr. Patras knew the

petitioner had friends in the two state

agencies which dealt with such matters.

Mr. Patras thus contracted Mr. Lisinski

and asked for help in dealing with the

agencies. Patras expected to pay for

the political influence he hoped the

petitioner could exert. 11/10/82 Tr.

221-22.

The petitioner then provided assis-

tance to Mr. Patras and asked him for

money with which to make payments to

public officials. App. 2-3. Receipt of

that money led to the petitioner's

conviction.

While the Court of Appeals referred

repeatedly to "demands" for money made

by the petitioner, id., he did not threaten

Patras or even suggest that the latter's

license problem would worsen if the

payments were not made. The Seventh

Circuit thus posed the appellate issue

as being whether the Hobbs Act may be

violated without a threat. App. 4.

Finding that it is sufficient that a

defendant prey upon or exploit the victim's

fear of economic loss, id., the Court

affirmed the conviction. "[N]Jo threat

is necessary for the wrongful use of

fear." App. 8.

REASONS FOR GRANTING

THE WRIT

aia

CERTIORARI SHOULD BE GRANTED

BECAUSE THE OPINION BELOW

CONFLICTS WITH THIS COURT'S

CONSTRUCTION OF THE HOBBS ACT

The Hobbs Act prohibits obstruction

ot enamine by extortion, which it defines

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." 18 U.S.C. § 195l.

Members and officials of labor unions,

the defendants in United States v.

Enmons, 410 U.S. 396 (1973), had been

charged with extortion based on five

specific acts of violence during a strike.

Id. at 397-98. As in the present case,

the Enmons prosecutors aspired to give

extortion a new grasp: here to extortion

without threats, there to the quest for

"legitimate collective-bargaining

demands." See id. at 408. Resolving

the statute's ambiguity in favor of

lenity and rejecting so great an incursion

into States' criminal jurisdiction in

the absence of plain Congressional lan-

guage, this Court demurred. Id. at 4ll.

Also like the present case, Enmons

required an interpretation of the statutory

term "wrongful." Not to make the term

superfluous, the Court recognized that

it must modify the end as well as the

means of the putative extortion. For

Enmons, the alleged violence incidental

to a lawful strike was not extortionate

because the end, a higher wage, was not

wrongful. Id. at 400. The extortionate

means in Enmons were force and violence,

terms for which the statutory modifier

"wrongful" are unnecessary. However,

unlike force or violence, the uses of

fear to obtain money are often not

wrongful, as evidence sales of deodorant

soaps, diet books and American Express

travelers checks. This Court knew the

legitimate uses of fear, but the Seventh

Circuit did not. Here is what this

Court said, together with the Seventh

-9-

a eee .

ee ee

a ee ee ee

“

SIP obrta2 recta g

A eaten tol a

= ees

Circuit's reading of it:

THIS COURT

For it would be redundant

to speak of "wrongful

violence" or

"wrongful force" since,

as the Government

acknowledges, any violence

or force to obtain property

is “wrongful.”

Emmons, 410 U.S. at 399-400.

SEVENTH CIRCUIT

Lisinski totally misreads

Enmons. Enmons is

simply autherity for the

proposition “that since all

means of obtaining property

which involve actual or

threatened force, violence

or fear are wrongful, ...

Lisinski, App. 6 (emphasis added).

By erroneously expanding the scope

of the redundant "wrongful" to include

fear, the Seventh Circuit relieved

itself of the need to give any content

at all to the statutory phrase “wrong-

ful ... fear." Instead, it begged

the question, explaining "wrongful"

with other ambiguous words: “Exploitation

a10=

of, or preying upon, the victim's fear

constitutes wrongful use of fear and

satisfies the statute." App. 6. In

Support it cited cases from the Fifth

and Eighth Circuits, as well as an

earlier Seventh Circuit decision. See

id. at 6-7. But Lisinski is in fact in

conflict with the cases it cited, for

they make the wrongful use of fear

depend on their defendants' threats,

which may be subtle or implicit. None

is authority for the Seventh Circuit's

novel view that extortion through the

wrongful use of fear of economic harm

requires no threat at all.

Moreover, other courts have inter-

preted the Enmons limitation (ends must

be illegitimate) to apply only in the

labor context. If the ends are legitimate,

but the context is not labor, a Hobbs

Act violation may occur if the means

are illegitimate. See United States v.

elje

aes a eS eee

Russo, 708 F.2d 209, 215 (6th Cir.),

cert. denied, Us. , 104 S.

Ct. 487 (1983); United States v. Zappola,

677 F.2d 264, 269 (2d Cir. 1982); United

States v. Porcaro, 648 F.2d 753, 760

(lst Cir. 1981); United States v. Cerilli,

603 F.2d 415, 419-20 (3d Cir. 1979),

cert. denied, 444 U.S. 1043 (1980);

United States v. Warledo, 557 F.2d 721,

729-30 (lOth Cir. 1977). The opinion

in Enmons must mean that both ends and

means must be illegitimate in the labor

context; outside that context, only

means need be illegitimate.

Finally, the Court made it clear

in United States v. Green, 350 U.S. 415

(1956), that the Hobbs Act focuses on

illegal means. There, the Court condemned

certain labor action (threats of force

and violence) because "[t]hose are not

legitimate means for improving labor

conditions." Id. at 420 (emphasis added.)

In contrast, in the instant case,

-)2-

the Seventh Circuit interpreted the

Court's opinion in Enmons to condemn

all use of fear. App. 6. This inter-

pretation ignores the language in Enmons

that “wrongful” is redundant when applied

to force and violence, not fear. 410

U.S. at 399-400. Moreover, by holding

that no threat is needed, the Seventh

Circuit interpreted the opinion in

Enmons to mean that illegitimate means

are never required for a Hobbs Act

violation. This is in fact the opposite

of the Court's holding. Enmons limited

the statute's reach, holding that illegit-

imate ends must supplement illegitimate

means ina labor context.

Il.

CERTIORARI SHOULD BE GRANTED

TO RESOLVE THE CONFLICT

CREATED BY THIS CASE WITH

LOWER COURTS' INTERPRETATIONS

OF THE

HOBBS ACT REQUIRING THREATS

The Hobbs Act prohibits anyone from

oi 3n=

affecting commerce by robbery or extor-

tion. Extortion is defined as the obtain-

ing of property from another, with his

consent, induced by the wrongful use of

actual or threatened force, violence or

fear, or under color of official right.

The statute does not further define

"wrongful use of fear.”

However, case law has determined

that "fear" includes fear of economic

harm, and that the necessary "use" of the

fear can be "exploitation" of an existing

fear. E.g., United States v. Crowley,

504 F.2d 992, 996 (7th Cir. 1974). The

issue here posed is whether the exploita-

tion required by the Act includes a threat

by the defendant to take retaliatory

action if payments are not made.

LIVINGSTON v. LISINSKI

Like the Seventh Circuit in this

case, the Eleventh Circuit in United

States v. Livingston, 665 F.2d 1003 (1982),

alae

; ties ci | Dail

ter Nc.

vo”

needed to distinguish those uses of fear

which do not constitute Hobbs Act extor-

tion. Livingston knew about an on-going

embezzlement scheme, but was not involved

in it. In return for money, he offered

to tell the victim about the scheme. The

Eleventh Circuit reversed the conviction

because "[i]n order to be guilty of the

wrongful use of fear, .. .a party must

cause, or threaten to cause the economic

loss to occur." 665 F.2d at 1005.

Conversely, the Eleventh Circuit held,

"Offering to sell information concerning

an embezzlement, without having any control

over the embezzlement, and without threat-

ening to cause the embezzlement to con-

tinue, may be morally repugnant but it

doesn't constitute extortion as defined

in 18 U.S.C. §1951(b)(2)." Id.

The Seventh Circuit's conflict with

Livingston could hardly be more stark,

for the petitioner Lisinski too made no

oi $=

threats and had no control over the

"victim's" fate. Nevertheless, "[t]Jhe

government argues .. . that no threat is

necessary. The government suggests that

extortion by wrongful use of fear of

economic harm is established by showing

that the defendant preyed upon or exploited

the victim's fear of economic harm. We

agree." App. 4.

The Seventh Circuit thus made threats

merely decorative appendages in an extor-

tion prosecution: "[A]lthough no threat

is necessary for the wrongful use of

fear, by the very nature of extortion

cases, threats - particularly ‘implied

threats' will almost always be present."

Id. at 8. Rejecting (without citing) the

Eleventh Circuit's formula for distin-

guishing criminal acts from non-extor-

tionate sales transactions, the Seventh

Circuit offers no alternative means of

discerning the boundaries of the crime.

wife

Louis Patras -- the "victim" in the

present case -- brought upon himself the

fear of losing his liquor license when he

converted his customers’ sales tax payments

to his own uses. Of course, it does not

exculpate the petitioner that he did not

cause the victim's fear. Id. at 6,

quoting United States v. Crowley, 504

F.2d 992, 996 (7th Cir. 1974). But the

fact that Mr. Patras was responsible for

his own fear illuminates his real choices:

He could pay his sales tax arrearage or

he could try to arrange for it to be

overlooked. True to his own traditions

of bribery and fraud, he opted for the

second. Lacking clout himself in the

right high places, he enlisted an old

friend he he thought had useful connec-

tions. Enter, the petitioner.

The petitioner stipulates that his

conduct may have been "morally repugnant,"

like that of the defendant in Livingston,

ai Fo

665 F.2d at 1005. But a generally wrong-

ful end does not extortion make. As

Enmons teaches, 410 U.S. at 400, and the

Seventh Circuit recognizes, Lisinski,

passim, the means -- the use of fear --

must also be wrongful. Unfortunately the

Seventh Circuit erred by going no further.

It turned to synonyms more ambiguous than

"wrongful," words that may be charged

with criminal meaning but often aren't:

"Exploitation of, or preying upon, the

victim's fear constitutes wrongful use of

fear and satisfied the statute." Id. at

6. The words may connote but mild criti-

cism, applicable at the speaker's fancy

to Playboy or Vogue, the Department of

Defense or nuclear freeze advocates,

perhaps even defense attorneys. Does

Bar-Bri prey upon new law school graduates,

exploiting their exaggerated fear of a

bar exam? "The tyranny of labels must

not lead us to leap to a conclusion that

-1@-

te eg PG ET OP Mele A

ae Sei WA aie tnltag > ders een tt GT ON AE

a word which in one set of facts may

stand for oppression or enormity is of

like effect in every other." Palko v.

Connecticut, 302 U.S. 319, 323 (1937).

When, then, does preying upon another's

fear become extortionate?

The answer lies in coercion. See

United States v. Hathaway, 534 F.2d 386,

395 (lst Cir.), cert. denied, 429 U.S.

819 (1976). At common law, the holder of

a public office was guilty of extortion

when, by virtue of his post, he coerced

payment for what he was duty bound to do.

United States v. Nardello, 393 U.S. 286,

289 (1969). Logically some states extend-

ed criminal extortion to other forms of

coercion. Id. In enacting the Hobbs

act, Congress took its definition of

extortion from the New York criminal law:

""the obtaining of property from anoth-

er . . . with his consent, induced by a

wrongful use of force or fear, or under

=~} 9=

ieee

color of official right.’ N.Y. Penal Law

§ 850 (1909). . .." See Enmons, 410

U.S. at 406 n.16 and legislative history

recounted therein.

The coercive use of fear demands a

threat, as inseparably as clouds and

rain. "The essence of the crime is

obtaining property by a wrongful use of

fear, induced by a threat to do an unlaw-

ful injury." People v. Dioguardi, 8

N.Y.2d 260, 268, 203 N.Y¥.S.2d 870, 877,

168 N.E.2d 683, 688 (1960) (construing

Section 850 on which the Hobbs Act defini-

tion of extortion is based). The threat

may be express. United States v. Sander,

615 F.2d 215, 219 (5th Cir. 1980) (quoted

to the contrary by the Seventh Circuit in

Lisinski, App. 6-7), cert. denied, 449

U.S. 835 (1980). It may be subtle.

Sander, 615 F.2d at 218; see also United

States v. Quinn, 514 F.2d 1250, 1266-67

(Sth Cir. 1975), cert. denied, 424 U.S.

@20-

955 (1976)(defendant “selling his influ-

ence under the threat of picketing which

would destroy his victim's business.")

And the threat may be implicit in the

defendant's power to bring to pass what

the victim fears. Crowley, 504 F.2d at

998 (defendant policeman's implied threat

to withhold needed police services);

Callanan v. United States, 223 F.2d 17l,

175 (8th Cir.), cert. denied, 350 U.S.

862 (1955)(defendant labor leaders created

reasonable fear even if they were not

responsible for past difficulties victim

feared would recur.) The power to harm

the victim need not be real, as long as

the victim reasonably fears that the

defendant can do so. United States v.

Rastelli, 551 F.2d 902 905 (2d Cir.),

cert. denied, 434 U.S. 831 (1977); see

also United States v. Billups, 692 F.2d

320, 331 (4th Cir. 1982), cert. denied,

U.S. , 104 S. Ct. 84 (1983)

(payment "the direct result of a perceived,

reasonable fear on [victim's] part that

noncompliance with the deal already struck

could lead to [defendant's] economic

retaliation.")

But where extortion convictions have

occurred without a threat, however subtle,

and without the defendants' having the

power or even the reasonably perceived

power from which they might imply a

threat, the Courts of Appeals have

reversed. Livingston, 665 F.2d at 1005.

See also United States v. Rabbitt, 583

F.2d 1014, 1027 (8th Cir. 1978), cert.

denied, 439 U.S. 1116 (1979).

They consistently reversed, that is,

until the Seventh Circuit affirmed the

petitioner's conviction by holding that no

threat at all, not even an implied or

subtle one, was required for extortion.

LISINSKI v. OTHER PRECEDENT

In the present case, the Seventh

«9%

(ROPING TSAR EAE ROOT TEN RN OOPS

—

Circuit asserted that "[c]Jase law amply

refutes Lisinski's arguments that the

wrongful use of fear requires a threat."

App. 6. In fact, the court's citations

and quotations only evidence the danger

that broad statements of principle some-

times outdistance the facts that gave

them birth. H.K. Porter Co. v. NLRB, 397

U.S. 99, 110 (1970)(Douglas, J., dis-

senting). In holding that extortion can

be proved where there was no threat or

pressure at all, the Seventh Circuit

eliminated coercion itself as the grava-

men of the crime. In that, it stands

alone among the circuits.

To refute the need for a threat, the

Lisinski panel first cited an earlier

Seventh Circuit case, Crowley, 504 F.2d

at 996. In Crowley, however, the defen-

dants were police officers who had the

power to bring about the dearth of police

services the victim feared. They had

atte

been charged with extortion under color

of official right. Id. at 994. As to

its alternative holding on the charge of

wrongfully using fear, Crowley stated

that there had been an implied threat.

Id. at 998.

Quoting Crowley, the Lisinski panel

included its parapharse of the Eighth

Circuit's decision in Callanan v. United

States, 223 F.2d 171, 175 (8th Cir.),

cert. denied, 350 U.S. 862 (1955). But

the labor leader defendants in Callanan

had argued only that their victim's fear

pre-existed their extortionate demand.

There was no evidence of express threats,

but none was needed to make the victim's

fear reasonable in the context of past

labor problems. The Eighth Circuit saw

that implicit threats could be just as

effective: "It appears to us that the

offense of extortion under the Hobbs Act

has been committed if the defendants have

=24-

illegally created fear in their victim,

which fear has induced the victim to part

with his money or property." Id. (emphasis

added.) The New York Court of Appeals

cited Callanan v. United States in con-

struing extortion to require a threat.

People v. Dioguardi, 168 N.E.2d at 689.

Callanan does not at the same time support

the Seventh Circuit's refutation of the

need for a threat.

Next Lisinski cites United States v.

Gerald, 624 F.2d 1291, 1299 (5th Cir.

1980), cert. denied, 450 U.S. 920 (1981).

In an abbreviated Hobbs Act discussion,

Gerald does not consider whether threats

are required for extortion. Like

Callanan, it states that the victim's

fear may have sprung from some other

source than the defendant, and in support

it cites United States v. Hyde, 448 F.2d

815, 833 (5th Cir. 1971), cert. denied,

404 U.S. 1058 (1972), a case that is rife

-25-

with threats both express and implicit,

the latter dependent on the defendants'

power to use the Alabama Attorney General's

office to operate a massive extortionate

scheme. Id. at 834.

Lisinski's next choice of a Fifth

Circuit case also does not support the

Seventh Circuit's reading threats out of

the law of extortion. It quoted from

United States v. Sander, 615 F.2d 215,

218 (5th Cir.), cert. denied, 449 U.S.

835 (1980), taking a long passage in

which the Fifth Circuit noted that the

defendant denied making threats. App. 7.

But on the next page, the Fifth Circuit

wrote that the “evidence at trial showed

that [defendant] did threaten [the victim]

with economic loss if he failed to supply

the promised bribe money." Sander, 615

F.2d at 219. Sander is authority for the

fact that threats may be subtle, id. at

218, but not that extortion is found

-26<

st Fe 8

debe oS

Naw RO 2 oe

Ni, males BSE aes

where there is no threat at all.

Lastly, the Seventh Circuit quoted

from United States v. Duhon, 565 F.2d

345, 351 (Sth Cir.), cert. denied, 435

U.S. 952 (1978). App. 7. Once again,

however, its quote is too abbreviated.

On the same page, the Fifth Circuit wrote

that the "jury reasonably concluded that

the threat of continued and perhaps

expanded picketing absent a payoff was

implicit in the actions of" the defen-

dants. Id. (emphasis added).

By reading threats and, with them,

coercion, out of the Hobbs Act definition

of the wrongful use of fear, the Seventh

Circuit in the instant case allows

proscutions for extortion whenever a

defendant's conduct may be more or less

repugnant, disdaining this Court's insis-

tence on resolving ambiguities carefully

for the sake of lenity and federalism.

Enmons, 410 U.S. at 4ll. In this case,

sy oe

the Seventh Circuit has created a con-

flict with the Second, Fifth and Eighth

Circuit cases it cited, as well as with

the Eleventh Circuit's holding in

Livingston, 665 F.2d at 1005, which it

did not cite. Petitioner asks this court

to resolve the conflict in his favor.

Itt.

CERTIORARI SHOULD BE GRANTED

BECAUSE THE HOBBS ACT'S

LEGISLATIVE HISTORY INDICATES

THAT THE DEFENDANT MUST

THREATEN THE VICTIM

The main purpose of the Hobbs Act was

to provide an effective deterrent to

labor violence. See 91 Cong. Rec. 11899-

922 (1945); 89 Cong. Rec. 3191-3234 (1943);

Report of the House Committee on the

Judiciary, H.R. Rep. No. 238, 79th Cong.,

lst Sess., (1945); H.R. Rep. No. 66, 78th

Cong., lst Sess., (1943); H.R. Rep. No.

2176, 77th Cong., 2d Sess., (1942).

-—)

Wii Ang eR nth ERR A ACARD CR Cae le am OE ee

However, it is also evident that Congress

meant extortion as used in the Act to

require a threat.

Representative Hobbs stated that the

definition of extortion used in the Act

is identical to the definition in N.Y.

Penal Law § 850, (McKinney 1944). 91

Cong. Rec. 11900 (1945). The Court in

Enmons agreed that the phrase "wrongful

use of fear" was taken from this law.

This law required a threat.

In a prosecution for extortion under

section 850, a New York court stated,

"The essence of the crime is obtaining

property by a wrongful use of fear,

indicated by a threat to do an unlawful

injury." People v. Dioguardi, 8 N.Y.2d

260, 268, 203 N.Y.S.2d 870, 877, 168

N.E.2d 683, 688 (1960). It is not nec-

essary that the defendant create the

-29-

fear, "so long as he succeeds in per-

suading [the victim] that he possesses

the power to remove or continue its course,

and instills a new fear by threatening to

misuse that power as a device to exact

tribute." Id. at 268, 203 N.Y.S.2d at

877, 168 N.E.2d at 689. The court cited

Callanan v. United States, 223 F.2d 171,

174-76 (8th Cir.), cert. denied, 350 U.S.

862 (1955), a Hobbs Act case, to support

its statement.

Similarly, in another New York extor-

tion case, the court stated that one can

extort by force or threat. People v.

Weinseimer, 117 App. Div. 603, 604-05,

102 N.Y.S. 579, 580, aff'd, 190 N.Y. 537,

83 N.E. 1129 (1907). Thus, under the New

York definition of extortion adopted in

' the Hobbs Act, one cannot extort without

use of a force or a threat to retaliate.

IV.

CERTIORARI SHOULD BE GRANTED

BECAUSE THE STATUTORY

INTERPRETATION BY THE SEVENTH

CIRCUIT VIOLATES THIS COURT'S

DELINEATION BETWEEN FEDERAL

AND STATE CRIMINAL JURISDICTION

Because the focus of the Seventh

Circuit's interpretation that no threat

is needed is on an act's illegitimate

ends, it effectively federalizes consid-

erable conduct heretofore cognizable only

under state law. State crimes are

"illegitimate" by definition; therefore,

anyone who profits by such a crime may

violate the Hobbs Act as well. But the

Act was never meant so to expand federal

jurisdiction, as previous opinions of

this Court have noted.

In Enmons, the Court explicitly

limited the scope of the Hobbs Act because

it determined that the federal government

was not meant to interfere unduly with

the states' criminal jurisdiction. 410

U.S. at 411. Thus the Court made it

«%la

at A me

clear that Congress did not design the

Hobbs Act for the purpose of federalizing

state court crimes. Instead, the Act

encompasses a new crime, which hinges on

the obtaining of property through coer-

cion, as well as an impact on commerce.

Coercion, not the ends of a person's

actions, is what makes the actions

violative of the statute. Because the

Hobbs Act adds a new element, coercion,

the overlap with state crime does not

expand to the extent disapproved by the

Court.

The distinction between federal and

state criminal jurisdiction must remain

sharp. The Court has repeatedly asserted

this position in a line of opinions begin-

ning with Rewis v. United States, 40}

U.S. 808 (1971). And see Williams v.

United States, 458 U.S. 279 (1982). The

opinion in Enmons was just one deter-

mination in a series of cases in which

o32<

the Court has made it clear that our

federal system will not tolerate the

absorption of state criminal jurisdic-

tion. Language found in United States v.

Bass, 404 U.S. 336 (1971), is particularly

applicable to the instant situation:

"unless Congress conveys its purpose

Clearly, it will not be deemed to have

significantly changed the federal-state

balance;" "Congress has traditionally

been reluctant to define as a federal

crime conduct readily denounced as criminal

by the States;" "the broad construction

urged by the Government renders tradi-

tionally local criminal conduct a matter

for federal enforcement and would also

involve a substantial extension of federal

police resources." Id. at 349-50.

Hence, the rule in favor of lenity

asserted in Enmons supplements this rule

against federal absorption of state crime

to militate against the expansive inter-

=33e

pretation adopted by the Seventh Circuit.

This Court's interpretation of the

Travel Act also provides a relevant

guide. Rewis warned against an unre-

stricted interpretation of the Travel Act

because "[it] would alter sensitive federal-

state relationship, could overextend

limited federal police resources, and...

would transform relatively minor state

offenses into federal felonies." 401

U.S. at 812. Heeding this warning, the

Second Circuit held that commercial bribery

did not constitute bribery for purposes

of the Travel Act. United States v.

Brecht, 540 F.2d 45 (2d Cir. 1976), cert.

denied, 429 U.S. 1123 (1977). To include

commercial bribery within the ambit of

the statute would distort the balance

between federal and criminal jurisdiction.

To include procurement of property without

threats within the Hobbs Act's scope

would produce a similar effect.

o3g-

Nothing in the Hobbs Act's language

remotely suggests that non-coercive use

of fear should be considered within its

scope. The definition of extortion as

"wrongful use of fear" at least leaves an

ambiguity which must be resolved by rules

of construction that favor a limited

federal jurisdiction.

In short, the illegal behavior which

creates the Hobbs Act offense is coer-

cion. This coercion must emanate from

the defendant, by his exploitation of

fear. Exploitation involves a retal-

iatory threat from the defendant --

extortion in the plain sense of the word.

Without such a threat, an "illegitimate"

claim to property probably constitutes a

violation of state law. But the Act does

not rise to the level of federal juris-

diction. Previous court interpretations,

lower court holdings, legislative history,

and rules of construction all favor a

=-35-

requirement that a threat be proven.

CERTIORARI SHOULD BE GRANTED

BECAUSE THE HOBBS ACT DOES

NOT CRIMINALIZE A BRIBERY SCHEME

IN WHICH THE DEFENDANT ACTED

AS AN AGENT OF THE PAYOR

The holding in Livingston, unlike

that in the instant case, also is consist-

ent with a line of cases that distinguish

bribery from Hobbs Act extortion. United

States v. Duhon, 565 F.2d 345 (5th Cir.),

cert. denied, 435 U.S. 952 (1978); United

States v. Pranno, 385 F.2d 387 (7th Cir.

1967), cert. denied, 390 U.S. 944 (1968);

United States v. Kubacki, 237 F. Supp.

638 (E.D. Pa. 1965). Simple bribery does

not constitute extortion. Duhon, 565

F.2d at 351; Pranno, 385 F.2d at 390;

Yubacki, 237 F. Supp. at 641. Only when

the bribery is supplemented with duress

does a Hobbs Act violation occur. For

example, in both Duhon and Pranno the

=36=

recipient of the bribe had made veiled

threats. In Duhon a labor union official

threatened expanded picketing. 565 F.2d

at 351. In Pranno the defendant threatened

to require an expensive drainage basin

before approving a factory site. 385

F.2d at 390. Without this duress through

a threat initiated by the defendant, as

in Kubacki, no extortion occurs. There

the defendant demanded a kickback in

return for which he would grant contractors

a city order. The court determined that

the only fear generated in the contractors

was that they would not be successful in

exercising undue influence; "That is not

the type of fear contemplated in § 1951."

Kubacki 237 F. Supp. at 642.

These cases stand for the proposition

that the Hobbs Act requires an element of

duress through a threat from a defendant.

Without such a threat, an act may constitute

a state bribery violation, but does not

«37a

rise to the level of a federal offense.

Thus "wrongful" in "wrongful use of fear"

is interpreted to mean wrongful means to

obtain property--through defendant

coercion.

As noted above, p. 7, Mr. Patras

sougnt the aid of the petitioner, expect-

ing to pay, and received assistance. See

App. 2. In making payoff money available

to Mr. Lisinski, Patras intended that his

wishes be carried out by Lisinski.

Lisinski thus was an agent in the classic

and legal sense. See Black's Law

Dictionary 85 (4th ed. 1951).*

* The Panel opinion found that while the

record may have supported a prosecution for

bribery, extortion also existed. It also

rejected the petitioner's argument that the

petitioner acted merely as Patras' agent.

App. 8-9.

As to the position that the petitioner

did not act as Patras' agent, consider the

government's concession in the court below:

"(T]Jhat Lisinski was acting on behalf of Patras

in exerting influence over State officials

is . . . not disputed. ..." Brief for

Appellee, p. 24. The impetus of the scheme,

Thus, it is incorrect, as well as

inexact semantically, to employ the

language that Lisinski had "no legitimate

claim to the property" of Patras. App.

6. Lisinski was vested by Patras with

control over the funds and an under-

standing existed between the men as to

the disposition of the funds.

It may be that Patras' actions, and

by extension Lisinski's, were illegal

under state law. But that does not con-

stitute Lisinski an unlawful claimant to

the funds vis-a-vis Patras for purposes

of the Hobbs Act. Similarly, that the

men's plans may have had criminal ramifi-

cations under state law does not warrant

a finding that the petitioner was an

extortionist. Were the case otherwise,

according to Patras, solely was his. Nothing

in the record suggests that the pet. tioner

acted against Patras' interests once the latter

requested aid.

=25e

any time a local crime was afoot, and to

further the scheme one of the plotters

was given property by a confederate, he

would violate the Hobbs Act under the

Seventh Circuit view that the nature of

the transaction meant that the recipient

had "no legitimate claim to the property."

Undoubtedly, too, under this view,

the confederate who provided the property

would be guilty of conspiring to violate

the Act. The principle, an untenable

one, would arise that under federal law a

person has "no legitimate claim" to such

of his property as he or she intends for

use in the violation of local criminal

laws.

CONCLUSION

WHEREFORE, for the above reasons,

the petitioner respectfully requests this

Court to grant his petition for a writ of

certiorari.

-40-

— os ek Oh ee ee

Respectfully submitted,

Thomas D. Decker

135 South LaSalle Street

Suite 853

Chicago, IL 60603

(312)263-4180

June 1984

aiie@

APPENDIX

Appendix

Appendix 1-12 - Court of Appeals Opinion

Appendix 13-14 - 4/2/84 Order of the

Court of Appeals

Denying Petition for

Rehearing

Appendix 15-29 - Portion of Trial

Transcript of 11/12/82

dn the

United States Court of Appeals

Sor the Seventh Cirentt

No. 83-1504

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v. ;

DEAN J. LISINSKI,

Defendant-Appellant.

Appeal from the United States District Court for the

Northern District of Illinois, Eastern Division.

No. 8 CR 490—Thomas R. McMillen, Judge.

ARGUED NOVEMBER 28, 1983—DECIDED FEBRUARY 21, 1984

Before CUMMINGS, Chief Judge, Woop, Circuit Judge,

and GRANT, Senior District Judge.*

GRANT, Senior District Judge. Defendant-Appellant

Dean J. Lisinski appeals his conviction of two counts of

extortion and one count of attempted extortion in viola-

tion of the Hobbs Act, 18 U.S.C. § 1951 (1976). Lisinski

raises three issues for our consideration:

I) Whether the evidence adduced at trial was insuf-

ficient to sustain the extortion conviction;

II) Whether the evidence at trial impermissibly

amended the indictment;

* Honorable Robert A. Grant, Senior District Judge for the North-

ern District of Indiana, is sitting by designation.

App. l

2 No. 83-1504

IIT) Whether the trial court abused its discretion in

denying Lisinski’s requests for the disclosure of

grand jury material?

For the reasons stated below, we AFFIRM Lisinski’s

conviction on all counts.

Facts

In a four count indictment returned in September, 1982,

Lisinski was charged with three counts of extortion and

one count of attempted extortion by the wron use of

fear of economic harm and under color of official right.

The evidence at trial revealed that Louis Patras, the vic-

tim of Lisinski’s extortionate demands, was the owner-

operator of the William Tell II restaurant in Countryside,

Illinois. In early 1980, the restaurant was in — of

losing its liquor license because of an $82,000 Illinois sales

tax liability. Because a liquor license was vital to the suc-

cess of the restaurant, Patras contacted Lisinski, an ac-

quaintance of his, for help. Lisinski worked for the Clerk

of the Circuit Court of k County and had friends in

the Illinois Liquor Control Commission and the Illinois

Department of Revenue, the two agencies with whom

Patras had to deal to retain his liquor license. Lisinski

had previously told Patras that he had political influence

and “. . . if you ever need anything from downtown, I

will be able to help you.”

On May 14, 1980, Lisinski accompanied Patras to a

revocation hearing before the Liquor Control Commission

and introduced Patras to its executive director, Jack

Wallenda. Unbeknown to Patras, his liquor license was

suspended that same day because of his substantial sales

tax liability. On June 10, Lisinski took Patras once again

to meet Wallenda. At that meeting, Wallenda told Lisin-

ski and Patras that Patras’ license been “blocked.” In

Patras’ presence, Lisinski told Wallenda to “unblock it.”

(R. 67-69). Wallenda did so and promptly issued Patras

a new license. Several days later, Lisinski called Patras

and demanded a thousand dollars “. . . to take care of

App. 2

No. 83-1504 ?

some people.” Patras paid Lisinski the money. This trans-

action formed the basis of Count I of the indictment of

which Lisinski was found not guilty.

Patras continued to experience liquor license difficulties.

On April 3, 1981, approximately 1 and % months before

his liquor license was to expire, Patras received a phone

call from Lisinski. Lisinski told Patras that it was t

that he make a $1,000 payoff to Wallenda. Patras balked

and said that he 2id not have the money. Within the hour,

two acquaintances of Lisinski called Patras and urged him

to make the payoff. Patras succumbed and borrowed as

much as he could—$500—which he paid to Lisinski (the

$500 which Patras borrowed was ultimately repaid from

restaurant funds.) Lisinski told him that the payoff of

$500, which formed the basis of Count II of the indict-

ment, might or might not be enough.

Following Lisinski’s second demand for money, Patras

contacted the FBI and permitted them to tape his deal-

ings with Lisinski. Two further demands for money to

assist with Patras’ liquor license problems occurred. On

May 29, 1981, two days before Patras’ liquor license was

due to expire, Lisinski telephoned Patras and demanded

yment of the $500 remaining from the April 3 payment.

Poteen, fearful that his license would be permitted to ex-

pire, paid the additional $500. On July 24, 1981, Lisinski

met with Patras at the William Tell and arranged for a

final payment of $3,000. The FBI supplied Patras with

$3,000 and witnessed Lisinski accepting the money.

The indictment alleged three counts of extortion cor-

responding to the June, April and May demands for

money. Count IV of the indictment alleged attempted ex-

tortion because the funds used were obtained from the

FBI. After a bench trial, Lisinski was found not guilty

of Count I because the extortionate demand was not made

until after Lisinski had assisted Patras to reacquire his

liquor license. Lisinski was found guilty on Counts II, III

and IV and brings this appeal.

App. 3

4 No. 83-1504

Whether the evidence is insufficient to sustain the ex-

tortion conviction?

a). Necessity of a Threat?

Lisinski contends that an indispensable element of ex-

tortion by wrongful use of fear of economic harm is a

. threat, whether direct or indirect. Lisinski argues that

the evidence at trial showed no threat and that Patras’

fear of economic harm was self-generated. The govern-

ment argues, on the other hand, that no threat is neces-

sary. The government ts that extortion by wro

use of fear of economic is established by showing

that the defendant preyed upon or exploited the victim’s

fear of economic harm. We agree.

Our analysis commences with the statute. Mills v.

United States, 713 F.2d 1249, 1251 (7th Cir. 1983). The

Hobbs Act provides:

(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 ex-

tortion or attempts or conspires so to do, or commits

or threatens physical violence to any person or prop-

erty in furtherance of a plan or purpose to do any-

thing in violation of this section shall be fined not

more than $10,000 or imprisoned not more than twen-

ty years, or both.

(b) As used in this section—

(2) The term “extortion” means the obtaining

of property from another, with his consent, in-

duced by wrongful use of actual or threatened

force, violence, or fear or under color of official

right.

(emphasis supplied) 18 U.S.C. § 1951 (1976).

“The Hobbs Act. . . is a broadly drawn statute. The cases

construing the Act have repwatedly emphasized that the

Congress, in passing the statute wanted to use all of the

App. 4

No. 83-1504 | 5

constitutional power it had to punish interference with in-

terstate commerce by extortion, robbery or physical

violence.” United States v. Sander, 615 F.2d 215, 218 (5th

Cir.), cert. denied, 449 U.S. 835 (1980), citing Stirone v.

United States, 361 U.S. 212, 215 (1960). This Circuit and

others have long recognized that the term “fear” in the

Hobbs Act includes fear of economic harm or loss. See

United States v. Dale, 223 F.2d 181, 183 (7th Cir. 1955)

(“We conclude that ‘fear’ as defined in the extortion sec-

tion of the Anti-Racketeering Act should be given its or-

dinary meaning and consequently ‘fear’ would include fear

of economic loss.”); United States v. Cusmano, 659 F.2d

714 (6th Cir. 1981); United States v. Forszt, 655 F.2d 101

(7th Cir. 1981); United States v. Gerald, 624 F.2d 1291

(5th Cir. 1980), cert. denied, 450 U.S. 920 (1981).

Lisinski cites to United States v. Enmons, 410 U.S. 396

(1973) for the proposition that extortion by wrongful use

of fear of economic harm requires a threat. Enmons in-

volved a situation where striking union members used

violent means to achieve legitimate labor ends. The

Supreme Court, in finding no violation of the Hobbs Act,

analysed the meaning of the word wrongful as used in

the statute:

... The term “wrongful” which on the face of the

statute modifies the use of each of the enumerated

means of obtaining property—actual or threatened

force, violence, or fear—would be superfluous if it

only served to describe the means used. . . . Rather,

“wrongful” has meaning in the Act only if it limits

the statute’s coverage to those instances where the

obtaining of the property woulc itself be “wrongful”

because the alleged extortionis. has no lawful claim

to that property.

(footnote omitted) 410 U.S. at 399-400. Lisinski argues that

since the Hobbs Act applies only to situations where both

the defendant’s ends and means are illegitimate, the

wrongful use of fear requires a threat. Otherwise, con-

cludes Lisinski, “. . . all entrepreneurs would be guilty

App. 5

6 No. 83-1504

if their services or products were designed to respond to

a consumer fear.”

Lisinski totally misreads Enmons. Enmons is simply

authority for the proposition that since all means of ob-

taining property which involve actual or threatened force,

violence or fear are wrongful, “wrongful” means that the

statute applies only to situations where the extortionist

has no legitimate claim to the property. Otherwise, the

use of the word “wrongful” in the statute would be redun-

dant. Enmons does not constitute authority that the

wrongful use of fear requires a threat.

Case law amply refutes Lisinski’s arguments that the

wrongful use of fear requires a threat. Exploitation of,

or preying upon, the victim’s fear constitutes wrongful

use of fear and satisfies the statute. In United States v.

Crowley, 504 F.2d 992 (7th Cir. 1974), the extortion vic-

tims were the owners of bowling lanes who paid off the

defendant, a police officer, to protect their business.

There, a3 here, the policeman was not responsible for the

conditions which generated the victim’s fear. But the

policeman exploited that fear, and was convicted under

the Hobbs Act:

It is important to note that it is unnecessary for the

government. to prove that defendant actually created

the fear in the minds of his victims. Rather, as the

Court in Callahan v. United States, 223 F.2d 171,

174-176 (8th Cir. 1955), cert. denied, 350 U.S. 862, ...

held, the exploitation of the victim’s reasonable fear

constitutes extortion regardless of whether or not the

defendant was responsible for creating that fear and

despite the absence of any direct threats.

(emphasis supplied) 504 F.2d at 996; See also United

States v. Gerald, 624 F.2d 1291, 1299 (5th Cir. 1980) (“In

the instant case, the decisive question under 18 U.S.C.

§ 1951 (the Hobbs Act) is whether Gerald [the defendant]

intended to cause Carter [the victim] to pay the $25,000

by exploiting Carter’s fear of economic loss. . . . The fear

need not have been actually caused by Gerald; the statute

App. 6

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No. 83-1504 7

is satisfied if Gerald intended to exploit that fear.) The

Fifth Circuit noted in United States v. Sander, 615 F.2d

215, 218 (5th Cir. 1980):

Appellant Sander argues that he never threatened

Knapp, and consequently that the element of fear,

a Ae sy element of the Hobbs Act, was not pres-

ent. Fear of economic loss is covered by the Hobbs

Act. The case law is also clear that the government

did not have to show either that the fear was a direct

consequence of the threat of economic loss or that

Knapp personally feared Sander. United States v.

Quinn, 514 F.2d 1250, 1266-67 (5th Cir. 1975), cert.

denied, 424 U.S. 955, 96 S.Ct. 1430, 47 L.Ed.2d 361

(1976). Subtle extortions are covered under the Hobbs

Act, and the government satisfied its burden of proof

if it showed circumstances surrounding the alleged

extortionate conduct that rendered the victim’s fear

of threatened loss reasonable.

See also United States v. Duhon, 565 F.2d 345, 351 (5th

Cir.), cert. denied, 435 U.S. 952 (1978) (“In the present

case, there is sufficient evidence to demonstrate the ex-

istence of a reasonable fear on the part of the victims

and the requisite intent to exploit that fear.’’)

Here, looking at the evidence in a light most favorable

to the government, Glasser v. United States, 315 U.S. 60,

80 (1942), more than adequate evidence was adduced to

sustain Lisinski’s extortion conviction. Patras reasonably

feared the loss of his liquor license because loss of the

license would put the William Tell restaurant out of busi-

ness. Although Lisinski did not create the vulnerable posi-

tion in which Patras found himself, he exploited and

preyed upon Patras’ fear. Patras reasonably believed that

if he did not cooperate with Lisinski, he would lose his

liquor license.

Lisinski argues that, although the cases cited by the

government state that no “direct threat” or “threat” is

necessary for the wrongful use of fear, either direct or im-

plied threats were present in each of those cases. To a

App. 7

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: sao se

8 No. 83-1504

certain extent, this is true. However, although no threat

is necessary for the wrongful use of fear, by the very

nature of extortion cases, threats—particularly “implied

threats” will almost always be present. The implied threat

will usually be that, unless the victim cooperates with the

extortionist, economic loss will result. The extortionist

need not be responsible for the situation in which the vic-

tim finds himself; what matters most are the “. . . cir-

‘cumstances surrounding the alleged extortionate conduct

that rendered the victim’s fear of threatened loss rea-

sonable.” Sander, supra at 218.

We conclude that the wrongful use of fear does not re-

quire a threat—although, in the victim’s mind, the threat—

usually implied—will be present. The wrongful use of fear

is satisfied if the extortioner exploits the victim’s fear of

economic loss, as did Lisinski in this case. We hold that

there was sufficient evidence to sustain Lisinski’s extor-

tion conviction.

b). Bribery, not Extortion.

Lisinski contends that this is a case of bribery, not ex-

tortion, because of the fact that Patras was willing to pay

to influence official action and because there was no com-

pulsion on Lisinski’s part. This argument is routine in ex-

tortion cases and meritless on the facts of this case.

Bribery and extortion are not mutually exclusive. United

States v. Price, 617 F.2d 455 (7th Cir. 1979). “That such

conduct may also constitute ‘classic bribery’ is not a rele-

vant consideration.” United States v. Braasch, 505 F.2d

139, 151 (7th Cir. 1974), cert. denied, 421 U.S. 910 (1975).

Regardless of the fact that a prosecution for bribery might

have been sustained, there exists more than adequate evi-

dence to sustain Lisinski’s extortion conviction. See sec-

tion a, supra.

Lisinski also argues, relying upon an unpublished opin-

ion of dubious precedential value, that since he was mere-

ly acting as Patras’ agent, he is not liable for extortion.

This is an imaginative—but equally unavailing—variation

on the bribery argument. More to the point, it misrepre-

App. 8

No. 83-1504 9

sents the evidence since it is obvious from the record that

Lisinski was not acting as Patras’ agent. 8

Whether the evidence at trial impermissibly amended

the indictment?

Lisinski contends that the evidence at trial imper-

missibly amended the indictment. He notes that, although

the indictment alleged that Lisinski affected interstate

commerce by obtaining funds from Patras, the proof at

trial showed that the funds for the extortionate payments

came from the William Tell restaurant. Relying upon

United States v. Stirone, 361 U.S. 212 (1960) and United

States v. Cusmano, 659 F.2d 714, 718-19 (6th Cir. 1981),

Lisinski concludes that his conviction must be set aside.

The rationale underlying the prohibition against amend-

ments to the indictment at trial is that “. . . a court can-

not permit a defendant to be tried on charges that are

not made in the indictment against him.” Stirone, supra

at 217. For example, in Stirone, the indictment alleged

a Hobbs Act violation affecting the movement of sand in

interstate commerce. At trial, however, the government

presented evidence ~~ an effect upon interstate com-

merce with respect to steel as well as sand. The Supreme

Court reversed Stirone’s conviction, finding that the in-

dictment had been impermissibly amended by the proof

at trial. Likewise, in United States v. Cusmano, 659 F.2d

714 (6th Cir. 1981), the Sixth Circuit reversed Cusmano’s

conviction where the indictment alleged extortion by

wrongful use of fear of economic harm while the evidence

at trial showed extortion by threats of violence and

physical harm.

While there was a variation between the evidence at

trial and the allegations of the indictment, it hardly rises

to the level of a constructive amendment of the indict-

ment. “Variances which create ‘a substantial likelihood’

that a defendant may have been ‘convicted of an offense

other than that charged by the grand jury’ constitute con-

structive amendments.” United States v. Beeler, 587 F.2d

App. 9

10 No. 83-1504

340, $42 (6th Cir. 1978). As this Circuit noted in United

States v. Warden, 545 F.2d 32, 35 (7th Cir. . 1976):

. . . in order for a variance . . . to be fatal, the evi-

dence offered must prove facts materially different

from those alleged in the indictment; a variance will

not be deemed fatal where the defendant is so in-

formed of the charges against him that he is protected

against a second prosecution for the same offense and

is able adequately to prepare his defense against the

charges set forth in the indictment.

(citations omitted).

Here, the facts adduced at trial simply explained the

allegations of the indictment. At trial, Patras testified that

the William Tell restaurant was a corporation owned by

him and his wife and the liquor license application he com-

pleted reflected that he was the 100% owner of the res-

taurant. The money which Patras paid to Lisinski came

from restaurant funds; the evidence at trial merely

showed that the funds were funneled through Patras.

There was not, nor could there be, any allegation that

this minor variation interfered with Lisinski’s trial

reparation. He was fully aware of the charges inst

ne We hold that there was no constructive amendment

of the indictment.

Ill

Whether the trial court abused its discretion in de-

nying Lisinski’s requests for the disclosure of grand jury

material?

Lisinski contends that the district court erred in refus-

ing to disclose grand jury transcripts to him, and that

insufficient evidence was presented to the grand jury to

sustain the indictment. Because we find that the district

court properly refused Lisinski’s request for the disclosure

of grand jury transcripts, we need not address Lisinski’s

unsupported assertions that insufficient evidence was

presented to the grand jury to sustain his indictment.

App. 10

No. 83-1504 11

The original indictment of July 1982 charged Lisinski

with extortion under color of official right. In September

1982, a superceding indictment was returned adding the

allegation that the extortionate payments were induced

by the wrongful use of fear of economic harm. The super-

ceding indictment was returned by the same grand jury

and without the presentation of additional evidence. Lisin-

ski speculates that there was insufficient evidence to sup-

port his indictment and moved the district court for dis-

closure of grand jury transcripts. The district court, after

examining the grand jury transcripts in camera, refused

Lisinski’s requests for disclosure of the transcripts.

Fed. R. Crim. P. 6(eX3XCXi) & (ii) detail the cir-

cumstances under which grand jury proceedings may be

disclosed:

— occurring before the grand jury may also be

made—

(i) when so directed by a court preliminarily to or

in connection with a judicial proceeding; or

(ii) when permitted by a court at the request of the

defendant, upon a showing that grounds may exist

for a motion to dismiss the indictment because of

matters occurring before the grand jury.

If the court orders disclosure of matters occurring

before the grand jury, the disclosure shail be made

in such manner, at such time, and under such condi-

tions as the court may direct.

(emphasis supplied). Lisinski relies upon Douglas Oil Co.

v. Petrol Stops Northwest, 441 U.S. 211, 222 (i979) as

authority that disclosure is appropriate in this case since

the need for disclosure outweighs the need for continued

secrecy. We disagree.

“Rule 6(e) codifies the traditional practice of grand jury

secrecy.” Matter of Grand Jury Proceedings, Muler Brew-

ing Company, 687 F.2d 1079, 1088 (7th Cir. 1982). “There

is a presumption of regularity which attaches to such pro-

App. ll

-——

SL SS FS A oe ee

12 ' No. 83-1504

ceedings and the defendants have a difficult burden to

rove any irregularity.” United States v. Battista, 646

.2d 237, 242 (6th Cir. 1981). Additionally, disclosure of

grand jury proceedings will be had only upon demonstra-

tion by , Laing seeking disclosure of a “compelling

necessity” “a particularized need.” Miller eeiag

Company, pon at 1088 citing Douglas Oi Co., 441 US.

at 222-23. The standard of review of a district court’s

determination not to disclose ~ jury proceedings is

- abuse of discretion since the “. . . court must exercise

_ substantial discretion, weighing the need for secrecy

against the need for disclosure of specified documents and

testimony occurring before the grand jury.” Jd.

There was no abuse of discretion in this case. Against

the time-honored and serious policy of grand jury secrecy,

_ Lisinski proffers an unsupported speculation that, possibly,

insufficient evidence was presented “ the grand jury to

sustain the indictment. Lisinski simply fails to overcome

the presumption of regularity voters 2 | to grand jury pro-

nella, or demonstrate the “compelling necessity” neces-

sary to require disclosure of grand jury proceedings. In-

deed, the district court which examined the grand jury

transcripts in camera found them to be adequate. We

hold that, for the reasons stated above, the district court

properly denied Lisinski’s request for the disclosure of

grand jury transcripts.

Conclusion

Lisinski’s conviction on all counts is AFFIRMED.

A true Copy:

Teste:

Clerk of the United States Court of

Appeals for the Seventh Circuit

USCA 40227—Midwest Law Printing Co., Inc., Chicago—2-21-84—400

App. 12

UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

CHICAGO, ILLINOIS 60604

April 2,

1984

Before

Hon. Walter J. Cummings, Chief Judge

Hon. Harlington Wood, Jr., Circuit Judge

Hon. Robert A. Grant, Senior District

Judge*

United States

of America,

Plaintiff-Appellee,

No. 83-1504

Dean Lisinski,

)

vs. )

)

Defendant-Appellant. )

Appeal from the

U.S. Dist. Court

for the Northern

District of Ill.,

Eastern Division.

No. 82 CR 490

Thomas R. McMillen

Judge.

ORDER

On consideration of the petition for

rehearing and suggestion for rehearing en

banc filed in the above-entitled cause by

defendant-appellant, no judge in active

service has requested a vote thereon, and

all of the judges on the original panel

* The Honorable Robert A. Grant,

Senior District Judge for the Northern

District of Indiana, is sitting by

designation.

App.

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have voted to deny a rehearing.

Accordingly,

IT IS ORDERED that the aforesaid

petition for rehearing be, and the same is

hereby, DENIED.

App. 14

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

UNITED STATES OF

AMERICA,

Plaintiff,

vs. No. 82 CR 490

DEAN J. LISINSKI.

)

) 83-1504

)

Defendant.

Before the Hon. Thomas R. McMillen

on Friday, November 12, 1982, at the

hour of 10:00 o'clock a.m.

The trial resumed pursuant to

adjournment.

Appearances: Mr. Keith C. Syfert and

Mr. David Stetler,

oi behalf of the Piaintiff;

Mr. Thomas Decker,

Ms. Mary Katharine Ryan and

Mr. Robert Handelsman,

on behalf of the Defendant.

App. 15

MR. SYFERT: No. There were other

payments made to Mr. Lisinski for other

reasons other than the liquor license but

those are not charged in this indictment.

They were introduced as similar acts

evidence only.

THE COURT: Well, as I say, I do not

believe that it would be a proper con-

struction of Section 1951 to find beyond a

reasonable doubt that Mr. Lisinski was

acting under color of official right even

though he was influencing persons that

were acting color of official right. I

think the statute must apply to the indi-

vidual being charged. I cannot in my own

mind rationalize that. Therefore, I would

not find him guilty of that alternative

charge in any of the counts.

Also, I have difficulty rational-

izing an extortion payment after the fact

has been accomplished that the extortion

App. 16

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was allegedly made for.

What happened in Count l, as I under-

stand the evidence, is that the license

was, I believe it was reinstated. I

checked my notes on that. I think he came

-- that is, Patras came to Mr. Lisinski

and said, "I need some help,” and Mr.

Lisinski agreed that he would do things

and he did those things or the liquor

license, I believe, was reinstated.

Actually, I believe, Mr. Lisinski in this

instance filled out part of it. Is that

Exhibit 4? Yes.

MR. SYFERT: Yes, it is, your Honor.

THE COURT: And took it down, or was

there at the time it was submitted. Then

it was some several days -- actually six

days -- six or seven days thereafter that p- 43

Mr. Lisinski said that he had to take care

of somebody and requested $1,000. That

was the beginning of the whole series

App. 17

of transactions, which I have difficulty

in finding constituted extortion.

Although the government argues that

the extortion was out of fear that some-

thing was going to happen in the future, I

don't see any such conversationg [sic]

about that. Maybe that was in Mr.

Patras' mind and maybe it wasn't. But it

was a whole year almost -- let's see -- it

was April, six months later that the

matter came to a head again, and that is

when Mr. Lisinski said he had to get

$1,000 on April 3, 1981 to take care of

the, I believe, possibility that the

liquor license was going to be -- well, I

guess the liquor license had been revoked

at that time.

But to counter Mr. Decker's con-

tention that Mr. Patras was the motivating

individual or force in this transaction,

it seems to me that the fact that Mr.

App. 18

Lisinski came to Mr. Patras after the

fact, in October of 1980, and said he

needed $1,000 to take care of somebody

sets the stage for what happened not only

at that time but for what happened in the

future.

After ali, Mr. Patras was given to

understand that these things couldn't be

done without paying somebody. It stands

to reason that he wasn't going to pay any-

body if he didn't have to. Granted he

went around paying people for things that

he had to do in order to accomplish his

means in other instances besides this. He

was a person that was perfectly willing to

do that but, on the other hand, he wasn't

going to do it if he didn't have to. It

was Mr. Lisinski who brought the question

up in the first instance.

MR. DECKER: Well, Mr. Patras said he

expected to pay. That was his state of

App. 19

p. 44

mind, his intent.

THE COURT: Expected to pay on the

first instance?

MR. DECKER: He expected to pay when

he went to Mr. Lisinski in May of 1980.

He did not limit his expectation in terms

of time. Presumably it extended through-

out the pericd of his problem.

THE COURT: Well, it seems to me that

it is fairly clear that he wouldn't have

paid, he wouldn't have taken the money out

of the till or the restaurant, partic-

ularly when the restaurant was in finan-

cial difficulties, if he didn't feel that

he had to in order to accomplish what he

had to do.

MR. DECKER: I think that is right

but that would be true of any briberty,

[sic] wouldn't it, your Honor.

THE COURT: It would be true of a

bribery but it would also be true of a

App. 20

person that is being subjected to extor-

tion.

MR. DECKER: That is right.

THE COURT: I would say the situation

| would be, perhaps, different but we only

have to deal with the facts that are in

the record. It might have been different

had Mr. Lisinski said to -- excuse me --

if Mr. Patras had said to Mr. Lisinski,

"I want to get my liquor license rein-

stated and I want you to help me. I'm

going to ask you to give somebody $1,000

to accomplish that." But that isn't the

way it happened. It happened just the

other way around. He asked him if he p. 45

could help, Mr. Lisinski's help, and then

Mr. Lisinski said I have to have $1,000 in

order to confirm what has happened here or

to pay off whoever did it, and he gave him

the $1,000. I don't consider that partic-

aS sas =” - —- even

ular transaction to have been extortion,

App. 21

——

frankly. As I said before, I have a

logical problem in saying that you can

extort something from somebody after the

fact, after the official act has been

accomplished. Because you don't have any

fear at that time, economic fear, that

anything is going to happen to you. You

have already gotten your license

restored.

So, I think that Mr. Lisinski has not

been properly charged under Count 1 and I

would find him not guilty under Count l.

However, as I said before, that lays

the pattern and the groundwork for what

happened in the future and every time that

something came up and Mr. Patras went to

Mr. Lisinski or even when Mr. Lisinski

came to him there was knowledge that

someone had to have some money in order to

accomplish this. At least Mr. Patras

thought somebody ought to have some money.

App. 22

I don't believe that the distinction

between economic harm to the William Tell

Corporation or the restaurant as an entity

can be successfully distinguished from

economic harm to Mr. Patras, which is what

is charged in the indictment. Mr. Patras

had all of his time, all of his energy,

all of his assets, if he had any net

assets, committed to these two restaurants

and the William Tell II was the one that

was in trouble. In fact, I don't know

what happened to the first restaurant,

whether it was even still in existence.

Whether it was or not, the economic harm

that he was afraid of was William Tell II

was going to be put out of business by not

having a liquor license. I can't follow

or, at least, I can't accept Mr. Decker's

argument that there are two separate

entities here that were fearing economic

harm and that therefore, since the jury

App. 23

p. 46

did not charge economic harm to William

Tell II there is a fatal variance or an

amendment, as you call it, to the

indictment by proof.

It seems to me that the economic harm

that was feared was clearly that in the

mind of Mr. Patras and it came through the

William Tell II as an entity but, never-

theless, was Mr. Patras' fear. In fact,

it would be a little difficult to imagine

a corporation as an entity having a fear

apart from its owner and apart from its

owner and apart from its president.

I suppose that is the reason you

object to the evidence about interstate

commerce with respect to alcoholic

beverages.

MR. DECKER: Yes.

THE COURT: From what I have said I

don't believe that is a distinction that

makes any difference as far as the law

App. 24

is concerned in this case.

I think IT have answered all of your

questions, Mr. Decker, or at least all of

your arguments on the basis of the

evidence.

To be specific, I find that the

government has proved paragraphs 1 and 2

of Count 1 beyond a reasonble doubt, which

has to do with the financial interest of

Mr. Patras in the William Tell II

Restaurant, which is not identified as a

corporation but which is identified by pe!

name, and the process for which liquor

licenses were obtained. That all is

alleged in paragraph 1 of Count 1, which

is incorporated in Count 2.

Paragraph 2 is an allegation of the

Original liquor license and the purchase

of liquor through interstate commerce,

which I believe has been proved beyond a

reasonable doubt.

App. 25

SE OE FI

ES cna

Then passing on to paragraph 2 of

Count 2, there is no question about the

payment. As a matter of fact, it hasn't

been denied as to the $1,000 which was

asked for and paid by Louis Patras on

April 3, 1981 to Dean Lisinski in order to

help keep the liquor license for the

William Tell Restaurant and that the

defendant, therefore, knowingly and

unlawfully obtained $500 from Louis

Patras, which was not due to him or to the

Liquor Control Commission and was obtained

from Louis Patras based on consent of

being induced by the wrongful use of fear

of economic harm.

So, I will find Mr. Lisinski guilty

beyond a reasonable doubt of Count 2.

The same two paragraphs of Count l

are incorporated in Count 3, which I have

already found have been proved beyond a

reasonable doubt. Paragraph 2 is the

App. 26

demand of $500 on May 29, 1981. It is

alleged that Mr. Lisinski wrongfully and

unlawfully obtained the $500 from Louis

Patras, which was obtained from him based

on consent being induced by the wrongful

use of fear of economic harm. There,

again, is no dispute that the payment was

made. It is my finding that it was made

because of a fear of economic harm. p. 48

Therefore, I will find Mr. Lisinski guilty

on Count 3.

Count 4 is the same except for the

admitted fact the $3,000 did not come from

Mr. Patras or from William Tell. However,

unbeknownst to Mr. Lisinski it was re-

quested from Mr. Patras and he attempted

to obtain it from Mr. Patras under fear of

wrongful use of economic harm and, al-

though it was not actually an interference

with interstate commerce and it was not

actually a payment which Mr. Patras

App. 27

aaa

or William Tell made itself, the $3,000

was an attempt to commit the crime of

extortion. I will find Mr. Lisinski

guilty on Count 4 of the indictment.

So, I will direct the Clerk to enter

a finding of not guilty on Count 1 and

guilty on Counts 2, 3 and 4 of the indict-

ment.

I will let the government have these

exhibits back which I have. I guess that

would include the transcript because they

don't need to be filed in the court

record. I presume they are already in the

transcriot of the court reporter's notes.

MR. STETLER: I don't believe they

were your Honor. I didn't notice the

stenographer taking notes at the time.

THE COURT: Wasn't she?

MR. STETLER: We will have a clear

record for the Court of Appeals because

the exhibits are clearly marked, the

App. 28

es or wee ———S

~ a ee TT TT ——_

eee ap See WH Onn

eA NE OE TE TI

transcripts.

MR. DECKER: In order to prepare post

trial motions, your Honor, I will order a

copy of the proceedings today and for that

reason would request thirty days for post

trial motions.

THE COURT: All right. I can set a

date for a hearing in.

App. 29

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.