U.S. v. Kuta

• Decision Date: 29 July 1975
• Docket Number: No. 74-1920,74-1920
• Citation: 518 F.2d 947
• Parties: 75-2 USTC P 9638 UNITED STATES of America, Plaintiff-Appellee, v. Frank J. KUTA, Defendant-Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 947

518 F.2d 947

75-2 USTC P 9638

UNITED STATES of America, Plaintiff-Appellee, v. Frank J. KUTA, Defendant-Appellant.

No. 74-1920.

United States Court of Appeals, Seventh Circuit.

Argued April 14, 1975.

Decided June 30, 1975.

Rehearing Denied July 29, 1975.

Julius Lucius Echeles, Chicago, Ill., for defendant-appellant.

James R. Thompson, U. S. Atty., Gary L. Starkman, and Michael D. Groark, Asst. U. S. Attys., Chicago, Ill., for plaintiff-appellee.

Before CASTLE, Senior Circuit Judge, and STEVENS and SPRECHER, Circuit Judges.

CASTLE, Senior Circuit Judge.

Defendant Frank J. Kuta, alderman of the twenty-third ward of the City of Chicago, Illinois from 1967 to 1971, was convicted by a jury on Counts II, IV, and IX of a ten-count indictment. Subsequently, the trial court acquitted the defendant on Count IV. Count II charged the defendant with extortion in violation of the Hobbs Act, 18 U.S.C. § 1951(a), (b)(2), ¹ and Count IX charged the defendant with the making of a false statement on his federal income tax return in violation of 26 U.S.C. § 7206(1). ² From his convictions on Counts II and IX, the defendant appeals. We affirm.

I.

A.

Count II charged the defendant with obstructing, delaying and affecting commerce by obtaining $1500, not due either him or his office, under color of official right. The indictment further specified that the payment was made because Sam Vanchieri, a realtor, "believed and feared that he would be unable to procure a zoning change on property . . . in the Twenty-third Ward of Chicago, unless he compensated defendant to refrain from objecting to such a change as a member of the Chicago City Council . . . ."

Viewed in the light most favorable to the Government, the evidence shows that Vanchieri believed that the alderman of the ward must approve zoning changes. In an attempt to have property that he owned in the twenty-third ward rezoned, Vanchieri contacted the defendant. At this initial meeting, Kuta told Vanchieri that he had no objection to the proposed zoning change. Nothing more was said. Vanchieri then filed an application for a zoning change, and on November 17, 1969 the requested amendment was passed by the full City Council, alderman Kuta voting in favor of the amendment.

On December 1, 1969 the defendant telephoned Vanchieri and asked to see him. Vanchieri responded that he would be right there. He then put a blank check in his pocket and went to Kuta's office. When he arrived, Vanchieri initiated the conversation by asking how much he owed. He asked that question because, in light of Kuta's telephone call, he "thought (he) owed him something for not objecting to the zoning." In response to Vanchieri's question, Kuta replied "$1500." Vanchieri made out the blank check that he had brought payable to himself, endorsed it, gave it to the defendant, and then left the office.

As a result of the zoning change, Vanchieri constructed three buildings on his newly zoned lots using materials transported in interstate commerce. ³

The defendant's first attack on his convictions is that the evidence is insufficient to establish the two essential elements of the Hobbs Act offense charged here: interference with commerce, and extortion. Stirone v. United States, 361 U.S. 212, 218, 80 S.Ct. 270, 4 L.Ed.2d 252 (1960). Considering first the element of extortion, the type of extortion charged here was the "obtaining of property from another, with his consent, induced . . . under color of official right." 18 U.S.C. § 1951(b)(2). In United States v. Braasch, 505 F.2d 139, 151 (7th Cir. 1974), cert. denied -- U.S. --, 95 S.Ct. 1562, 43 L.Ed.2d 775 (1975), we explained:

The use of office to obtain payments is the crux of the statutory requirement of "under color of official right" . . . . So long as the motivation for the payment focuses on the recipient's office, the conduct falls within the ambit of 18 U.S.C. § 1951.

The evidence here is sufficient to show that it was Kuta's office that brought forth Vanchieri's payment, and that therefore the defendant committed extortion. Vanchieri believed that the alderman must approve zoning changes, the approval taking the form of not objecting to the proposed change. In addition to Vanchieri's belief, the record shows that persons contacted the defendant about zoning problems, ⁴ and a realtor, Irwin Michaels, testified that he discussed payments for zoning changes with the defendant. ⁵ The jury could conclude from this evidence that as alderman the defendant exercised power over zoning amendments, and that the payment by Vanchieri was made to influence that aldermanic power. See United States v. Staszcuk, 502 F.2d 875, 878 (7th Cir. 1974), rev'd in part on other grounds en banc, 517 F.2d 53 (1975).

Turning to the interstate commerce element, there was evidence that buildings constructed on the rezoned property could not have been constructed under the pre-existing zoning, and it was stipulated that those buildings contained materials that had moved in interstate commerce. See note 3 supra. Clearly, this is adequate to show that the rezoning affected interstate commerce by facilitating the flow of building materials across state lines. United States v. Staszcuk, supra, at 878 & n.8. The defendant argues, however, that the evidence is insufficient to show that the rezoning was procured by the extortion, and therefore, that the extortion affected commerce.

Contrary to the defendant's contention, the evidence supports a conclusion by the jury that the zoning change was procured because the defendant agreed not to exercise his independent judgment on the merits of that change in return for payment. Although the payment occurred after the zoning amendment was passed, and the evidence does not indicate that prior to its passage payment was explicitly discussed, the jury could infer that an agreement existed from the fact that payment was expected by the defendant, and that Vanchieri so understood. Kuta's telephone call sparked Vanchieri to bring a blank check to the defendant's office, and to initiate the conversation by asking how much he owed. The testimony shows that Kuta did not express any surprise at this question, nor did he ask Vanchieri what he meant, but simply and tersely responded "$1500." This expectation of payment, further strengthened by Vanchieri's reasons for making the payment, supports a finding that there existed a tacit understanding according to which the defendant refrained from objecting to the zoning amendment in return for a subsequent payment of money, and that this restraint affected the passage of the amendment. Consequently, the jury could find that the extortion affected commerce, and that the defendant thereby violated the Hobbs Act.

B.

The defendant timely objected to the trial court's instruction on the commerce element of the Hobbs Act. The instruction charged the jury that commerce was affected as a matter of law if they found beyond a reasonable doubt that certain facts occurred. ⁶ The defendant contends that the instruction was erroneous because it is the jury's function to determine whether interstate commerce is affected. He asserts that the result of the court's instruction was to impermissibly direct a verdict on that issue.

We were faced with a similar contention in United States v. Green,246 F.2d 155 (7th Cir.), cert. denied 355 U.S. 871, 78 S.Ct. 122, 2 L.Ed.2d 76 (1957). We held there that:

It was clearly the function of the court to determine whether interstate commerce was affected and whether the court had jurisdiction under the Act. As stated in Hulahan v. United States, (214 F.2d 441, 446 (8th Cir.) cert. denied 348 U.S. 856, 75 S.Ct. 81, 99 L.Ed. 675 (1954)): "We think it was for the court, and not the jury, to determine whether the Government's evidence, if believed, would bring the activities of the defendant within the statute and sustain federal jurisdiction." See also Nick v. United States, 8 Cir., 122 F.2d 660, 673, 138 A.L.R. 791.

Id. at 160-161.

Similarly, in United States v. Hyde, 448 F.2d 815, 839 & n.34 (5th Cir. 1971), cert. denied 404 U.S. 1058, 92 S.Ct. 736, 30 L.Ed.2d 745 (1972), the court, after a comprehensive review of the case law, concluded that it was for the jury to determine if the facts occurred, but that the trial court should determine if commerce was affected.

The defendant's argument fails to draw the distinction between factual determinations which the jury must make, and the legal impact of those determinations which the trial court is competent to evaluate. The cases on which the defendant relies are inapposite because the instructions in those cases pre-empted jury determinations of factual issues. ⁷ Here, however, the instruction clearly left the factual issues for the jury, and thus we find no error.

The defendant also contends that the instruction was erroneous because it failed to include a definition of commerce. A definition was not necessary, however, because what constitutes interstate commerce and whether it was affected were matters of law that the trial court resolved. The instruction was proper.

II.

The defendant was a member of the law firm of Kash and Kuta. Prior to trial, a subpoena was issued directing the defendant to produce "(a)ll partnership books and records for the partnership of Kash and Kuta for the years 1965 through and including 1970." The defendant moved to quash the subpoena, arguing that it violated his Fifth Amendment privilege against compulsory self-incrimination. The Government, seeking only the partnership's financial records, supports the issuance of the subpoena by relying on Bellis v. United States, 417 U.S. 85, 94 S.Ct. 2179, 40 L.Ed.2d 678 (1974), and the defendant, in turn, contends that he falls outside the scope of that decision. ⁸

In Bellis, the Court held that a former partner of a small, three-partner Pennsylvania law firm could not invoke his privilege against self-incrimination to justify a...