United States v. Kirsch
| Decision Date | 12 September 2018 |
| Docket Number | No. 16-3329-cr,August Term, 2017,16-3329-cr |
| Citation | 903 F.3d 213 |
| Parties | UNITED STATES of America, Appellee, v. Mark N. KIRSCH Defendant-Appellant, Carl A. Larson, Michael J. Caggiano, Jeffrey C. Lennon, Gerald H. Franz, Jr., James L. Minter, III, Jeffrey A. Peterson, Kenneth Edbauer, George Dewald, Michael J. Eddy, Thomas Freedenberg, Gerald E. Bove, Defendants. |
| Court | U.S. Court of Appeals — Second Circuit |
Monica J. Richards, Assistant United States Attorney, for James P. Kennedy, Jr., United States Attorney for the Western District of New York, Buffalo, NY, for Appellee.
Brian M. Melber, Personius Melber LLP, Buffalo, NY, for Defendant-Appellant.
Before: Lohier and Droney, Circuit Judges, and Rakoff, District Judge.**
In 2016, Appellant Mark N. Kirsch was convicted of Hobbs Act extortion conspiracy and racketeering conspiracy based on predicate acts of New York Penal Law extortion violations. The jury concluded that Kirsch, the president of the local chapter of a labor union, used threats of violence and destruction of property in an attempt to force contractors to hire members of his union.
On appeal, Kirsch argues that United States v. Enmons , 410 U.S. 396, 93 S.Ct. 1007, 35 L.Ed.2d 379 (1973), shields him from Hobbs Act liability, requiring that his Hobbs Act conspiracy conviction be reversed. In Enmons , the Supreme Court held that a union official could not be convicted of Hobbs Act extortion if the official’s conduct was undertaken in pursuit of "legitimate union objectives." Id. at 400, 93 S.Ct. 1007. With respect to the racketeering conspiracy conviction, Kirsch contends that an Enmons -like exception exists under New York law that shields him from New York Penal Law extortion liability, also requiring the reversal of that count of conviction. He also maintains that (1) the property he was charged with extorting—wages and benefits for union members—was not "transferable," as required by Sekhar v. United States , 570 U.S. 729, 133 S.Ct. 2720, 186 L.Ed.2d 794 (2013) ; (2) the Government presented insufficient evidence of his involvement in the charged Hobbs Act conspiracy; and (3) the district court’s instructions regarding the required mental state for threats for the extortion charges were incorrect.
We hold that (1) under New York Penal Law, there is no Enmons -like exception for extortion committed in pursuit of a legitimate labor objective; (2) the property Kirsch was convicted of extorting was "transferable" as required by Sekhar ; (3) the district court’s instructions with respect to extortion under the New York Penal Law were correct; but (4) the Government presented insufficient evidence of Kirsch’s involvement in the charged Hobbs Act conspiracy. Because we hold that the government presented insufficient evidence to support the Hobbs Act conviction, we need not reach Kirsch’s argument that Enmons shields him from Hobbs Act liability. As a result, Kirsch’s conviction for racketeering conspiracy is affirmed, and his conviction for Hobbs Act extortion conspiracy is reversed.
Kirsch was the president and business manager of the International Union of Operating Engineers—Local 17 ("Local 17") from 1997 to 2008. Local 17 operated in the Buffalo, New York area. At trial, the government presented evidence that Kirsch instructed Local 17 members to "turn or burn" contractors who did not employ them, meaning that non-union contractors would have to hire Local 17 members ("turn") or the union would obstruct their work ("burn"). Union members, at the direction of Kirsch, picketed and blocked construction sites, threatened construction managers, tampered with equipment, and destroyed property.
Kirsch was charged with multiple counts of unlawful conduct with respect to numerous contractors. However, after the jury’s verdict and his motion for judgment of acquittal was granted in part, Kirsch remains convicted only of Racketeering Conspiracy ( 18 U.S.C. § 1962(d) ) under Count 1 for his role in attempting to extort two contractors—Ontario Specialty Contracting ("OSC") and Earth Tech—and Hobbs Act extortion conspiracy ( 18 U.S.C. § 1951(a) ) under Count 2 with respect to conduct directed at a third contractor, Amstar Painting ("Amstar").1 Accordingly, we limit our review to those two counts of conviction and the circumstances involving those three contractors. We briefly summarize the evidence presented at trial as to those contractors.2
OSC is an environmental contractor that provides soil remediation services. In June 2005, OSC began a project at the waterfront in Buffalo to prepare the site for later construction. Before such construction could begin, OSC was tasked with excavating contaminated material and transporting it to a disposal facility.
Before the contract was awarded to OSC, a Local 17 representative invited the owner of OSC, Jon Williams, to have lunch with him and Kirsch. Williams testified at trial that at the meeting, Kirsch stated that if OSC did not use Local 17 members for the project, OSC would not "get the project, and if [it] did get the project, [it]’d never get it done." Gov’t App. 15. Despite Kirsch’s demand that OSC employ Local 17 members, OSC refused. At a meeting before the project’s ceremonial ground-breaking, Kirsch again threatened to stop the project. Local 17 then began picketing the site. During the picketing, Local 17 members prevented trucks from entering or leaving the worksite, and placed metal "stars" to puncture truck tires in the entranceway of the worksite. Additionally, on multiple occasions, OSC workers discovered upon arrival in the morning that padlocks on the entrances to the site had been tampered with so that they could not be unlocked.3
In 2005, Earth Tech, also an environmental remediation company, entered into a $10 million contract to remove contaminated soil from a school in the Buffalo area. When Earth Tech refused to sign an agreement to hire Local 17 workers, Local 17 members began picketing the job site. In addition, Local 17 members blocked entrances to the site and placed metal stars and roofing nails by its entrance to damage tires of vehicles. As a result of this conduct, Earth Tech obtained an injunction to prevent further disruption at the worksite. When an Earth Tech project manager notified the picketers of the injunction, one of the Local 17 members threatened him. Later, as the project manager was leaving for the night, his car was surrounded by picketers; about an hour passed before he was permitted to leave.
In September of 2003, Amstar, a painting contractor, was involved in a bridge rehabilitation project in Buffalo. After the project had begun, a Local 17 member, Edward Perkins, asked John Lignos, the vice president of Amstar, to assign a Local 17 worker to operate a compressor at the job site. The compressor did not actually require an operator, as "operating" it simply required turning it on in the morning and turning it off at the end of the day.4 Lignos refused to hire a Local 17 member for that purpose.
When the Amstar employees arrived on the morning after Lignos told Perkins he would not hire a Local 17 member, they discovered that the diesel fuel line in the compressor had been cut, causing diesel fuel to spill into the asphalt, resulting in substantial cleanup and repair costs.
On December 18, 2007, a grand jury in the United States District Court for the Western District of New York indicted five members of Local 17—not including Kirsch—on charges of Hobbs Act extortion and conspiracy. On April 1, 2008, the grand jury returned a superseding indictment, adding additional counts and additional defendants, including Kirsch. A second superseding indictment—the operative indictment at trial—was returned on January 10, 2012. It included racketeering conspiracy and Hobbs Act extortion conspiracy charges.
Kirsch and his codefendants moved to dismiss the indictment, arguing—as relevant here—that the alleged threatening and violent conduct was undertaken to achieve legitimate union objectives and thus could not constitute extortion under either the Hobbs Act or New York Penal Law. See Enmons , 410 U.S. at 400, 93 S.Ct. 1007.5 The district court concluded that Enmons did not shield Kirsch and his codefendants from liability, and denied the motion to dismiss.
Shortly after the Supreme Court decided Sekhar , and still before trial, Kirsch and his codefendants again moved to dismiss the indictment. Their second motion argued that the property that the indictment alleged was extorted was not "transferable," as required for Hobbs Act extortion by Sekhar . See Sekhar , 570 U.S. at 734, 133 S.Ct. 2720. The district court concluded that while certain of the forms of property that the indictment alleged was extorted failed to satisfy Sekhar, two other forms of property alleged in the indictment satisfied Sekhar . The district court denied the motion to dismiss as to those two types of property.
After the motion was granted in part and denied in part, only the following two types of property remained charged in the indictment:
The New York state extortion predicate racketeering acts in Count 1 (identified as Racketeering Acts 4B and 5B) defined the property extorted in the first of these ways; Racketeering Acts 4A and 5A of Count 1, and Count 2 (Hobbs Act conspiracy) defined the property in the second manner.
Kirsch and four of his codefendants proceeded to trial. The codefendants were acquitted of all charges. Kirsch, however, was convicted of racketeering conspiracy (Count 1) a...
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