Defendant had a building company make improvements on his home and demanded various cash payments by reminding the company that one of its employees had improperly billed Defendant’s company. Defendant was convicted of extortion under the Hobb’s Act. The trial court granted Defendant’s motion of acquittal notwithstanding the verdict. Defendant appealed other related convictions and the government cross-appealed the acquittal.
For an extortion conviction under the Hobbs Act, a direct threat of future harm is not necessary to prove the reasonableness of a victim’s fear.
Alfred Covino (Defendant) was the director of network services at NYNEX Mobile Communications Company (NYNEX), a telephone-service provider and cell-site builder. Great Northeastern Building and Management Corporation (GNBM) was a small, three-employee company half-owned by Robert Brennan. GNBM had been hired by NYNEX to build cell sites in a contract that accounted for about 90 percent of GNBM’s business. As director, Defendant had control over the selection, supervision, and payment of the contractors that were hired to build cell sites. Defendant learned that a former GNBM employee had improperly billed $3,200 to a NYNEX credit card. Defendant showed the bills to Brennan and warned Brennan that it would not be good if Defendant’s superior found out about the bills. Brennan offered to pay the bills, but Defendant said that he would handle the bills himself. Shortly thereafter, Defendant asked Brennan for help in building a sun deck for Defendant’s home. Defendant reminded Brennan about the improper bills, and as a result, Brennan agreed to build the deck at a low cost. Ultimately, Brennan built an entire sunroom for Defendant, expending more than $20,000. Defendant later induced Brennan to pay for other improvements on Defendant’s house and demanded various cash payments totaling to $85,000. At the time, GNBM was almost entirely dependent upon its construction contract with NYNEX. Defendant was charged with a violation of the Hobbs Act, 18 U.S.C. § 1951, which criminalizes extortion by the wrongful use of fear of economic loss. At trial, Brennan testified that he feared Defendant would use his position as director to destroy GNBM if Brennan did not comply with Defendant’s demands. Defendant was convicted and moved for judgment of acquittal notwithstanding the verdict. The district court granted the motion, citing insufficient evidence of the use of wrongful fear. Defendant appealed from other related convictions, and the government cross-appealed from the district court’s Hobbs Act acquittal.
Whether a direct threat of future harm is necessary to prove the reasonableness of a victim’s fear for an extortion conviction under the Hobbs Act.
No. The trial court’s ruling is reversed and the case is remanded for sentencing. For an extortion conviction under the Hobbs Act, a direct threat of future harm is not necessary to prove the reasonableness of a victim’s fear.
A threat of imminent harm is not an essential element in determining the reasonableness of a victim’s fear under the Hobbs Act. In a case involving extortion by wrongful use of fear of economic loss, the government must prove that the victim reasonably believed (1) that the defendant had the power to injure the victim and (2) that the defendant would use that power to the victim’s disadvantage. Here, the evidence of Brennan’s fear of economic loss was sufficient to support the jury’s guilty verdict on the Hobbs Act charge. Defendant possessed significant authority in selecting and paying contractors. Defendant was therefore in a position as director to seriously harm GNBM’s business. Brennan reasonably feared that GNBM would lose its contract with NYNEX and thus almost all of its business if Brennan did not comply with Defendant’s demands. It was also reasonable for Brennan to believe that Defendant would use his position of power as a director to injure GNBM if Brennan did not do as Defendant said. Defendant reminded Brennan twice of the improper phone bills when asking Brennan to make the requested payments and improvements on Defendant’s home, which could be reasonably interpreted as threats.