United States v. Billups

• Decision Date: 31 August 1981
• Docket Number: Crim. No. 80-146-N.
• Citation: 522 F. Supp. 935
• Parties: UNITED STATES of America v. Myles E. BILLUPS, Sr.
• Court: U.S. District Court — Eastern District of Virginia

522 F. Supp. 935

UNITED STATES of America v. Myles E. BILLUPS, Sr.

Crim. No. 80-146-N.

United States District Court, E. D. Virginia, Norfolk Division.

August 28, 1981.

As Corrected August 31, 1981.

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Justin W. Williams, U. S. Atty., Theodore S. Greenberg, Asst. U. S. Atty., Alexandria, Va., J. Phillip Krajewski, Asst. U. S. Atty., Norfolk, Va., for plaintiff.

Sacks, Sacks & Larkin, Norfolk, Va., for defendant.

MEMORANDUM AND ORDER

WALTER E. HOFFMAN, Senior District Judge.

At the oral argument with respect to defendant's post-trial motions heard on August 4, 1981, the Court deferred ruling on certain of said motions to permit further time to research the questions presented. They are as follows:

COUNT I — Hobbs Act — Effect on Commerce

Defendant argues that the evidence is insufficient in two respects to sustain his conviction on Count 1 for violation of the Hobbs Act, 18 U.S.C. § 1951: the government failed to show either sufficient effect on interstate commerce or fear of economic loss amounting to extortion on the part of Marano.

The argument that the proof failed to satisfy the jurisdictional requirement of an effect on commerce ignores the great weight of opinion on this subject, as illustrated by defendant's preliminary reliance in his brief on an opinion of a panel of the Seventh Circuit that was later reversed on this very point by the court sitting en banc. United States v. Staszcuk, 502 F.2d 875 (7th Cir. 1974), rev'd. 517 F.2d 53 (7th Cir.) (en banc), cert. denied, 423 U.S. 837, 96 S.Ct. 65, 46 L.Ed.2d 56 (1975). The en banc court wrote that, even if there is no actual effect on commerce, if there is a realistic probability the transaction would have some effect on commerce, the jurisdiction test would be met. Id. at 59-60. In United States v. Spagnolo, 546 F.2d 1117, 1118-19 (4th Cir. 1976), cert. denied, 433 U.S. 909, 97 S.Ct. 2974, 53 L.Ed.2d 1093 (1977), the court wrote that the nexus with interstate commerce under the Hobbs Act should not be construed narrowly as limited to conduct of extortion that directly and immediately affects the movement of goods. Thus, a forced sale by the victim of his one-half interest in a company could affect commerce because the company would be deprived of the victim's resources. The Fourth Circuit has recently applied the same test of affect on interstate commerce in interpreting RICO and held that the bribes and the racketeering themselves need not influence commerce as long as the enterprise itself is involved in interstate commerce. United States v. Long, 651 F.2d 239 (4th Cir. 1981).

The enterprise or company whose funds are depleted needs to have some link with interstate commerce, but the purchase of goods out-of-state or the utilization of some facility of interstate commerce, even if not substantial or integral to the enterprise, is sufficient to provide that link. So in United States v. Santoni, 585 F.2d 667 (4th Cir. 1978), cert. denied, 440 U.S. 910, 99 S.Ct. 1221, 59 L.Ed.2d 459 (1979), a chemical cleaning demolition company created by the FBI, which was obviously a one-shot company to go out of existence when it had fulfilled its purpose, had the requisite effect on interstate commerce. The theory was that, in buying goods out-of-state and using interstate facilities, "in each instance interstate commerce was affected by the extortion of funds which otherwise might reasonably have been expected to be channeled into the purchase of materials in interstate commerce." Id. at 672. Accord, United States v. Sander, 615 F.2d 215, 218 (5th Cir. 1980) (Development company's dealings in interstate commerce provided requisite "effect" on same); See generally, United States v. Rabbitt, 583 F.2d 1014, 1023 (8th Cir. 1978) and cases cited therein. (Fact that victim's check drawn on his private account does not mean interstate commerce was not affected or the effect was too remote).

Count I involved an attempted payment to defendant of $10,000 by Marano, then an official of Prudential Lines, to repay defendant for his help in lowering the amount Prudential had to pay to settle the contract dispute over the LASH PACIFICO. It was undisputed that Prudential was involved in interstate shipping, being the owner of ships that came into port at Norfolk and elsewhere to be unloaded by ILA labor. Under the theory of Spagnolo and Santoni, the depletion of Prudential's resources by $10,000 would also provide the requisite link to interstate commerce. An attempt to accomplish this purpose is punishable by statute.

COUNT I — Hobbs Act — Economic Fear

The second issue as to Count I is whether the jury could reasonably believe that Marano was induced to attempt to pay Billups $10,000 on November 26 out of fear of future economic loss. The evidence was in conflict on the point, but it is my opinion after reading the transcript that sufficient evidence existed from which the jury could reach that conclusion.

The principal case on which defendant relies is United States v. Critchley, 353 F.2d 358 (3d Cir. 1965), in which a union official solicited and received bribes from a roofing contractor to forebear from complaining that the roofer failed to meet the job specifications in the contract. The Third Circuit found that the government failed to prove effect on interstate commerce, a ruling at odds with factually similar cases from several other circuits. In addition, the court found that the threat of future labor disputes and work stoppage probably did not constitute extortion, but, if it did, the proof at trial fatally varied the facts alleged in the indictment where the indictment specified the dates on which the actual payments took place but failed to set forth the times when the threats took place, even though the dates of the extortion behavior were set out in the bill of particulars. That holding has, in effect, been overturned as the law of the Third Circuit in United States v. Somers, 496 F.2d 723, 745 (3d Cir. 1974), and has been rejected by this circuit and others. See, e. g., United States v. Quicksey, 525 F.2d 337 (4th Cir. 1975) (Travel Act dates can be varied); United States v. Baldivid, 465 F.2d 1277, 1279 (4th Cir.), cert. denied, 409 U.S. 1047, 93 S.Ct. 519, 34 L.Ed.2d 499 (1972) (variance in date and place under Hobbs Act). See, also, United States v. Moore, 512 F.2d 1255, 1256 (4th Cir. 1975) (Variance in type of gun possessed not fatal); United States v. Covington, 411 F.2d 1087 (4th Cir. 1969) (six-month variance in dates on which stolen vehicle transported in interstate commerce not fatal); United States v. Mason, 68 F.R.D. 619, 637 (D.Md. 1975) (Not fatal to vary underlying prior conviction in indictment by proof of conviction for another crime entirely four years later). Cf. United States v. Crocker, 568 F.2d 1049, 1060 (3d Cir. 1977) (change in proof of individual from whom payola was received fatally varied indictment for making false declaration to grand jury); United States v. Goldstein, 502 F.2d 526 (3d Cir. 1974) (en banc) (Because time is of essence in a violation for willful late filing of a tax return after April 15, a conflict in dates between indictment and proof dealt with matter of substance, not mere formality). In Somers, supra, a Hobbs Act indictment reading "on or about" a certain date was not fatally varied by proof at trial that neither the threats nor the payments themselves took place at the times set out in the indictment. The per se rule of Critchley against variances in dates between indictment and proof was rejected for a more flexible two-part analysis. The new test is: (1) was defendant placed in danger of double jeopardy by indictment stating one date or set of facts and proof stating another and (2) if not, was defendant prejudiced in preparing for trial? Somers was able to prove neither and therefore, his conviction was upheld. The holding that the variance in dates was not fatal was based on a determination that time was not of the essence in either a Travel Act or Hobbs Act violation. Somers, supra, at 745; accord, Quicksey, supra; Baldivid, supra. Here, in Count I, Billups was charged with attempted extortion "on or about November 26, 1975", which, under the Third Circuit's new test in Somers, as opposed to its old one in Critchley, was not a sufficient variance to put Billups in danger of a second prosecution for the same offense, nor did it prejudice him in preparing his defense, especially in light of the bill of particulars which provided adequate time before trial. In addition, although as in the now defunct Critchley case, the attempted payments actually took place on the dates alleged in the indictment, but the telephone calls and other extortive behavior that led to the attempted payments occurred at an earlier time, this indictment read "on or about," which was the saving phrase in Somers.

The other case on which defendant relies is United States v. Rabbitt, 583 F.2d 1014 (8th Cir. 1978), in which the court found that payoff of a state legislator by an architectural firm, after the firm had received an award or contract from a state board, in return for the legislator's having recommended the firm to the state board that made such awards, did not amount to extortion under the Hobbs Act. Several facts distinguish Rabbitt from this case. The court in Rabbitt, supra, at 1027, explained its reversal as based on several factors, but made clear that its general rule, barring those factors, would not exclude finding payments such as the one at issue here constituted extortion. "Bribery and extortion need not be mutually exclusive," the court wrote, and payments induced by fear of anticipated economic loss could constitute extortion, as presumably had the firm in Rabbitt feared it would not receive any awards in the future were it not to pay defendant. Id. at 1026-27. Several factors, however, led the court to find that such...