United States v. Augello

• Decision Date: 23 November 1971
• Docket Number: Docket 35281.,No. 266,266
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Anthony AUGELLO, Defendant-Appellant.
• Court: U.S. Court of Appeals — Second Circuit

451 F.2d 1167 (1971)

UNITED STATES of America, Plaintiff-Appellee, v. Anthony AUGELLO, Defendant-Appellant.

No. 266, Docket 35281.

United States Court of Appeals, Second Circuit.

Argued November 5, 1971.

Decided November 23, 1971.

John N. Iannuzzi, New York City (Iannuzzi & Iannuzzi, New York City), for appellant.

Richard A. Levie, Atty., U. S. Dept. of Justice, Washington, D. C. (Robert A. Morse, U. S. Atty. for the Eastern District of New York, Sidney M. Glazer, Atty., U. S. Dept. of Justice, Washington, D. C., of counsel), for appellee.

Before WATERMAN, SMITH and TIMBERS, Circuit Judges.

J. JOSEPH SMITH, Circuit Judge:

Anthony Augello was convicted on trial to the jury in the United States District Court for the Eastern District of New York, Joseph C. Zavatt, Judge, on two substantive counts of a four-count indictment charging him and two co-defendants¹ with conspiracy and three substantive offenses² of extortion obstructing interstate commerce, in violation of the Hobbs Act (18 U.S.C. § 1951).³ He was sentenced to concurrent five-year prison terms on each count, but has been enlarged on bail pending the determination of this appeal. We find no reversible error and affirm the conviction.

The government's principal witness at trial was one Saul Rosen, alleged owner of a Brooklyn drive-in restaurant called Happy-Burger, which was incorporated with Rosen as its president. Appellant and his co-defendants became regular Happy-Burger customers during the summer of 1968. According to Rosen's testimony, appellant on September 2, 1968 asked for $100, which sum Rosen, considering appellant to be a friend, agreed to pay on the assumption it was a loan. Two days later, when he requested repayment, Rosen discovered it was not a loan after all; indeed an additional $100 was demanded forthwith on pain of physical harm, together with $250 a month for Rosen "to be with" appellant. Appellant explained that: "from now on you are with me * * * nobody else will bother you," at the same time giving Rosen three telephone numbers where he could be reached for assistance. Rosen promptly paid the second hundred dollars, taking it directly from the cash register at Happy-Burger, unlike the first hundred which had apparently been on Rosen's person. Finally, Rosen was told that should he ever decide to sell his business, 50% of the proceeds were to go to appellant. On September 9, 1968, Rosen called the police.

On September 10, 1968, the police equipped Rosen with a radio transmitter, and stationed themselves outside Happy-Burger with a receiver and tape recorder. Before the receiver went dead, the police allegedly overheard appellant refuse to pay for food and threaten physical violence if Rosen failed to make further payments. The police later destroyed the tape which recorded appellant's alleged statements, claiming that it was unintelligible.

Sometime after the police receiver had ceased functioning, Rosen purportedly offered a $100 payment which appellant said would be collected by another party. Co-defendant Caserta returned the same night and was given $100 in marked bills by Rosen; when he passed the money to appellant, both men were arrested.

Appellant complains that although Happy-Burger purchased its meat products from a New Jersey concern, the indictment nevertheless failed to charge a violation of the Hobbs Act⁴ because those products were procured by the corporate entity, whereas appellant dealt solely and personally with Rosen, extorting his personal funds, not money belonging to the corporation. Consequently, appellant concludes, it cannot be said that his actions interfered with interstate commerce.

We disagree. Although ownership of stock in Happy-Burger was not elicited at trial, it was the uncontradicted testimony of Rosen that he owned Happy-Burger, operated it with the assistance of one full-time and one part-time employee, and himself ordered the meat products which were the mainstay of the restaurant from a New Jersey concern. One of the three payments made to appellant came directly from the cash register of Happy-Burger; all threats were made at or near the restaurant; one demand made was for 50% of the proceeds should Happy-Burger be sold.

If believed, the evidence showed that Rosen, acting in his business capacity as the owner and operator of Happy-Burger, was induced by threats of physical violence to make money payments to appellant in return for protection against interference in operating his restaurant. Patently a corporate entity can be threatened only through the people who operate it. To threaten Rosen in his business capacity was to obstruct the operation of Happy-Burger.

Nor does the providential fact that Rosen's fear led him to the police before the conduct of his business was affected in a way demonstrably interfering with interstate commerce remove this case from the purview of the Hobbs Act. While the effect on interstate commerce was obviously sharper in the otherwise similar case of United States v. DeMasi, 445 F.2d 251 (2d Cir. 1971), wherein actual disturbances in a nightclub led to its failure and the complete curtailment of interstate purchases, the requisite effect need not be so devastating. Given the sweeping power of Congress under the commerce clause, Katzenbach v. McClung, 379 U.S. 294, 305, 85 S.Ct. 377, 13 L.Ed.2d 290 (1964), particularly evident in the Hobbs Act, Stirone v. United States, 361 U.S. 212, 215, 80 S.Ct. 270, 4 L.Ed.2d 252 (1960), it is enough that the extortion "in any way or degree," 18 U.S.C. § 1951(a), affects commerce, though its effect be merely potential or subtle. United States v. Tropiano, 418 F.2d 1069, 1076-1077 (2d Cir. 1969), cert. denied, Grasso v. United States, 397 U.S. 1021, 90 S.Ct. 1258, 25 L.Ed.2d 530 (1970); Hulahan v. United States, 214 F.2d 441, 445 (8 Cir.), cert. denied, 348 U.S. 856, 75 S.Ct. 81, 99 L.Ed. 675 (1954). Here, depletion of Happy-Burger's resources, which by itself may impair the efficient conduct of its business sufficiently to affect commerce, United States v. Provenzano, 334 F.2d 678, 692 (3 Cir.), cert. denied, 379 U.S. 947, 85 S.Ct. 440, 13 L.Ed.2d 544 (1964), was shown at the very least by the September 5, 1968 payment taken directly from Happy-Burger's cash register. We are therefore persuaded that the charges in this indictment provided a proper basis to invoke the Hobbs Act.

Appellant next challenges the charge to the jury that if the evidence that Rosen purchased goods in interstate commerce, and that he was the victim of extortion, were believed, then as a matter of law interstate commerce was affected. The charge was correct; "it was for the court, and not the jury, to determine...