United States v. Brissette ( 2019 )

United States Court of Appeals
For the First Circuit
No. 18-1254
UNITED STATES OF AMERICA,
Appellant,
v.
KENNETH BRISSETTE; TIMOTHY SULLIVAN,
Defendants, Appellees.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Leo T. Sorokin, U.S. District Judge]
Before
Torruella, Kayatta, and Barron,
Circuit Judges.
Randall E. Kromm, Assistant United States Attorney, with whom
Andrew E. Lelling, United States Attorney, were on brief, for
appellant.
Sara E. Silva, with whom William H. Kettlewell and Hogan
Lovells US LLP were on brief, for appellee Kenneth Brissette.
Thomas R. Kiley, with whom William J. Cintolo, Meredith G.
Fierro, and Cosgrove Eisenberg & Kiley were on brief, for appellee
Timothy Sullivan.
Paul F. Kelly, Donald J. Siegel, Jasper Groner, Segal Roitman
LLP, Michael T. Anderson, and Murphy Anderson PLLC on brief for
Members of Congress representing Greater Boston, amici curiae.
March 28, 2019
BARRON, Circuit Judge. In 2015, two officials of the
City of Boston, Massachusetts (the "City") allegedly threatened to
withhold permits from a production company that needed them to put
on a music festival, unless the company agreed to hire additional
workers from a specific union to work at the event. The officials
were indicted for Hobbs Act extortion and conspiracy to commit
Hobbs Act extortion two years later in the United States District
Court for the District of Massachusetts. The defendants sought to
dismiss the indictment for failing to satisfy the "obtaining of
property" element of Hobbs Act extortion. 18 U.S.C. § 1951(b)(2).
The District Court granted that motion, and the government appeals
from the order of dismissal. We vacate and remand.
I.
The Hobbs Act prohibits interference with interstate
commerce through "robbery or extortion." Id. § 1951(a). The Hobbs
Act defines "extortion" as "the obtaining of property from another,
with his consent, induced by wrongful use of actual or threatened
force, violence, or fear, or under color of official right." Id.
§ 1951(b)(2). The "induced by wrongful use of actual or threatened
force, violence, or fear" prong of the offense delineates a
distinct form of extortion from the "under color of official right"
prong. See Evans v. United States, 504 U.S. 255, 263-64, 264 n.13
(1992).
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The indictment sets forth charges against Kenneth
Brissette and Timothy Sullivan, each of whom were employees of the
City at all relevant times. The indictment charges each of them
with Hobbs Act extortion and conspiracy to commit Hobbs Act
extortion in violation of 18 U.S.C. §§ 1951 and 2. The indictment
charges Brissette and Sullivan, however, only under the "induced
by wrongful use of . . . fear" prong of Hobbs Act
extortion -- specifically, with the "wrongful use of fear of
economic harm." See 18 U.S.C. § 1951(b)(2).
A grand jury handed up the initial indictment on May 27,
2016. That indictment charged Brissette alone with only Hobbs Act
extortion. The grand jury then handed up a superseding indictment
on June 28, 2016. The superseding indictment added a charge of
Hobbs Act extortion against Sullivan and also charged both men
with conspiracy to commit Hobbs Act extortion.
The operative indictment is a third superseding
indictment. It alleges the following facts, which we accept as
true for purposes of our review. See United States v. Ngige, 780
F.3d 497, 502 (1st Cir. 2015).
Brissette and Sullivan were both employed by the City at
the time of the alleged offenses. Brissette was the Director of
the City's Office of Tourism, Sports, and Entertainment. That
office, among other responsibilities, helps entities that wish to
host events in Boston secure permits to use public areas as the
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venues. Pursuant to his official powers, Brissette had the ability
to issue and hold such permits. Sullivan was the Mayor's Chief of
Staff for Intergovernmental Relations and the Senior Advisor for
External Relations. The Mayor at the time was Martin Walsh.
Crash Line is a production company that had a licensing
agreement with the City to put on biannual music festivals on
Boston City Hall Plaza.1 The licensing agreement required Crash
Line to obtain permits from the City to stage each festival.
Between July and September 2014, Crash Line sought
certain permits and approvals from the City to put on one such
festival in September 2014 as well as an extension of its licensing
agreement. While Crash Line was awaiting the permits and the
licensing agreement extension, Brissette and Sullivan repeatedly
told Crash Line that it would have to hire members of the
International Alliance of Theatrical Stage Employees Local 11
Union ("Local 11") to work at the upcoming music festival.2 Crash
Line repeatedly stated that its labor needs for that music festival
were already satisfied by a pre-existing contract with a non-union
company. The licensing agreement between Crash Line and the City
1 The indictment refers to Crash Line as "Company A."
2
In 2013, Local 11 had attempted to obtain work for its
members from Crash Line to work at an upcoming festival. Crash
Line was not a signatory to any collective bargaining agreement
with Local 11. Crash Line repeatedly told Local 11 that its labor
needs for that upcoming music festival were satisfied by a contract
that it had already entered with a non-union company.
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did not obligate Crash Line to hire the workers that it needed to
put on a festival from any union or otherwise place restraints on
Crash Line's hiring practices.
On September 2, 2014, Brissette and Sullivan met with
Crash Line and again insisted that Crash Line hire members of Local
11 to work at the upcoming music festival. Brissette and Sullivan
insisted that half of Crash Line's labor at the festival consist
of union members. That same afternoon, Crash Line "entered into
a contract with Local 11 to hire eight additional laborers and one
foreman as a result of the demands made by Brissette and Sullivan."
Shortly thereafter, the City issued Crash Line the permits that it
needed to put on the festival.3
The first superseding indictment alleged that Brissette
and Sullivan had "attempted to and did obtain" from Crash Line
3 The indictment also alleges facts relating to two separate
incidents in the summer of 2014 in which Brissette and Sullivan
allegedly threatened to refuse to issue permits to two other
production companies -- a production company filming the reality
TV series Top Chef in Boston (referred to in the indictment as
"Company B") and a production company filming a promotion for that
show (referred to in the indictment as "Company C") -- unless they
agreed to "make a deal" with Local 25 of the International
Brotherhood of Teamsters. But, the indictment does not allege
these incidents as separate counts of Hobbs Act extortion or
conspiracy to commit Hobbs Act extortion. Instead, the government
represented that it intends to offer evidence of these incidents
only as proof of the defendants' intent, which is not at issue in
this appeal. Accordingly, we do not need to address whether the
facts alleged in the indictment relating to these incidents
sufficiently allege an "obtaining of property" under the Hobbs Act
extortion provision.
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"money to be paid as wages for imposed, unwanted, and unnecessary
and superfluous services and wages and benefits to be paid pursuant
to a labor contract with Local 11." That indictment further
alleged that Brissette and Sullivan had done so "with the consent
of [Crash Line] . . . , which consent was induced by the wrongful
use of fear of economic harm to [Crash Line] and others." The
indictment also alleged that Brissette and Sullivan had conspired,
"together with others, known and unknown to the Grand Jury," to
commit the alleged extortion.
In January 2017, Brissette and Sullivan moved to dismiss
that indictment pursuant to Federal Rule of Criminal Procedure
12(b)(3). They contended that the indictment failed to allege
"that the defendants themselves obtained or sought to obtain th[e]
wages" alleged to be the extorted property. The District Court
denied the motions.
In September 2017, we issued our decision in United
States v. Burhoe, 871 F.3d 1 (1st Cir. 2017), which concerned the
scope of Hobbs Act extortion. The defendants thereafter filed
renewed motions to dismiss the first superseding indictment under
Federal Rule of Criminal Procedure 12(b)(3). They argued that, in
light of Burhoe, the indictment did not adequately allege the
required elements of "wrongful[ness]" and "obtaining of property."
The government opposed the defendants' motions and, on
November 29, 2017, obtained a second superseding indictment. That
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indictment modified the description of the "property" that the
defendants had allegedly "obtain[ed]" from Crash Line to "money to
be paid as wages and employee benefits and as wages and employee
benefits pursuant to a contract with IATSE Local 11." Then, on
January 31, 2018, the government obtained a third superseding
indictment -- the operative one -- that made only non-substantive
changes to the charging language.
On February 28, 2018, the District Court again refused
to dismiss the indictment, because the defendants' motions to do
so were based upon facts beyond the indictment. Nevertheless, in
light of the parties' disagreement over the meaning of "obtaining
of property" in the Hobbs Act extortion provision, the District
Court offered the following proposed instruction as to that
element:
To prove ["obtaining of property" under the Hobbs
Act extortion provision], the government must prove
beyond a reasonable doubt that Crash Line was
deprived of its property, and that the defendants
acquired that property. A defendant "obtains"
property for these purposes when he either: 1)
takes physical possession of some or all of the
property; 2) personally acquires the power to
exercise, transfer, or sell the property; or 3)
directs the victim to transfer the property to an
identified third party and personally benefits from
the transfer of the property. It is not enough for
the government to prove that the defendants
controlled the property by directing its transfer
to a third party, nor is merely depriving another
of property sufficient to show that the defendants
'obtained' that property.
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As to the third theory of "obtaining," the District Court also
proposed to instruct the jury that:
Under the third theory of "obtaining," you must
determine, based on all of the evidence before you,
whether the defendants personally benefitted from
the transfer of the property. Instances in which
a defendant personally benefits from the transfer
of property could include: when the defendant or an
organization of which he is a member receives a
thing of value other than the property as a result
of the transfer; when the defendant directs the
property to a family member or to an organization
of which the defendant is a member; and/or when the
defendant directs the property to a person or
entity to whom the defendant owes a debt, intending
that the transfer of property will satisfy that
debt. A defendant does not personally benefit from
the transfer of property when he merely hopes to
receive some future benefit, or when he receives a
speculative, unidentifiable, or purely
psychological benefit from it.
The District Court presented its proposed instructions as
governing only the "obtaining" element. The District Court did
not purport in the proposed instructions to address any of the
other elements of Hobbs Act extortion.
The government filed an emergency motion for
reconsideration of the District Court's proposed jury
instructions. The government challenged only the "personal
benefit" requirement that the District Court's proposed
instructions had imposed for the third theory of "obtaining." The
government indicated that its evidence would be insufficient to
meet that element if the District Court did not change the proposed
instructions. The defendants opposed the government's motion.
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They argued that the District Court's proposed instructions
correctly stated the law governing the "obtaining" element.
The District Court declined to reconsider its legal
analysis but asked the government to proffer "the admissible
evidence of [personal] benefit it possesses." The government made
such a proffer4 and filed a motion under Federal Rule of Criminal
4
The government proffered the following evidence "regarding
whether the defendants obtained a personal benefit in connection
with their efforts to force Crash Line to transfer wages and
benefits to Local 11 workers":
 Mayor Walsh enjoyed the support of multiple unions
during his campaign for mayor, and some members of
the administration assumed that unions would be among
his preferred constituents.
 Local 11 Business Agent Colleen Glynn reported to her
union members in an email on September 3, 2014 that
they secured one crew chief and eight deck hands for
the September 2014 Boston Calling Concert, and that
"I want you all to know we got a ton of help from City
Hall. Starting with the top, Mayor Walsh and his staff
members Tim Sullivan & Joe Rull . . . these folks
fought hard for us because Local #11 fought hard for
them . . . and we MUST keep supporting them & the
political candidates who will keep fighting on the
side of labor. When there is a call to action event
Local #11 must send help."
 The defendants wanted to avoid any embarrassment that
a Local 11 picket and the use of a giant inflatable
rat on City Hall Plaza might cause to a defendant and
the Walsh administration, especially in light of the
June 2014 actions of Teamsters Local 25 members in
connection with the filming of Top Chef in Boston and
Milton, which actions had garnered press attention
and criticism in August 2014.
On appeal, the government does not dispute the District Court's
conclusion that the evidence that it proffered did not suffice to
show a personal benefit under the District Court's proposed
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Procedure 12(b)(1) "request[ing] that the Court now decide the
legal issue of whether 'obtaining' has been shown."
Simultaneously, the defendants filed renewed motions under Federal
Rule of Criminal Procedure 12(b)(3), unopposed by the government,
for dismissal of the indictment.
On March 22, 2018, the District Court, resolving both
the Rule 12(b)(1) and 12(b)(3) motions, dismissed the indictment.
The District Court rejected the government's "primary position
that no showing of benefit whatsoever is required to prove
extortion (even where the property is acquired by a third party,
rather than the defendants)." The District Court concluded that
the government's proffered evidence and the facts alleged in the
indictment were insufficient to show -- as it interpreted
"obtaining of property" in the Hobbs Act extortion provision to
require -- that the defendants received a personal benefit from
the transfer of wages and benefits to the Local 11 workers that
the defendants allegedly directed Crash Line to make. The
government then appealed.
II.
Under Federal Rule of Criminal Procedure 12(b)(3), a
defendant must "raise[] by pretrial motion" any "defect in the
instructions. The government's position is -- as it was
below -- that no such showing of personal benefit is required to
show an "obtaining of property" under the Hobbs Act extortion
provision.
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indictment or information, including . . . failure to state an
offense." Fed. R. Crim. P. 12(b)(3)(B)(v). Ordinarily, with
respect to such a motion, "the question is not whether the
government has presented enough evidence to support the charge,
but solely whether the allegations in the indictment are sufficient
to apprise the defendant of the charged offense." United States
v. Savarese, 686 F.3d 1, 7 (1st Cir. 2012); see also United States
v. Stewart, 744 F.3d 17, 21 (1st Cir. 2014) ("At the indictment
stage, the government need not 'show,' but merely must allege, the
required elements [of the offenses charged].").
In limited circumstances, however, "under Federal Rule
of Criminal Procedure 12(b)(1), 'a district court may consider a
pretrial motion to dismiss an indictment where the government does
not dispute the ability of the court to reach the motion and
proffers, stipulates, or otherwise does not dispute the pertinent
facts.'" United States v. Musso, 914 F.3d 26, 29-30 (1st Cir.
2019) (quoting United States v. Weaver, 659 F.3d 353, 355 n* (4th
Cir. 2011)). "Under this scenario, a pretrial dismissal is
essentially a determination that, as a matter of law, the
government is incapable of proving its case beyond a reasonable
doubt." United States v. Hall, 20 F.3d 1084, 1088 (10th Cir. 1994)
(emphasis in original).
Based on the government's motion under Federal Rule of
Criminal Procedure 12(b)(1) for the District Court to "decide the
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legal issue of whether 'obtaining' has been shown" and the
defendants' simultaneous renewed motions, unopposed by the
government, for dismissal of the indictment under Federal Rule of
Criminal Procedure 12(b)(3), the District Court dismissed the
indictment. The District Court did so based on its determination
that the facts alleged in the indictment and the government's
proffered evidence "regarding whether the defendants obtained a
personal benefit" were insufficient to "prove [that] the
defendants obtained the property at issue as required" under the
Hobbs Act extortion provision.
We have jurisdiction under 18 U.S.C. § 3731 to review any
"decision, judgment, or order of a district court dismissing an
indictment." Id.; see also Weaver, 659 F.3d at 355 n.*. "Because
the district court's ruling was a legal determination based on its
interpretation of [18 U.S.C. § 1951(b)(2)] and relevant case law,"
Hall, 20 F.3d at 1088, we proceed to "review[ing] the [D]istrict
[C]ourt's conclusion de novo," Musso, 914 F.3d at 30.
III.
The primary issue on appeal is a limited one. We must
decide whether the defendants' "merely directing property to a
third party" constitutes their "obtaining of [that] property"
under the Hobbs Act extortion provision -- as the government
contends -- or whether -- as the District Court ruled and the
defendants assert -- the defendants must also "enjoy[] a personal
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benefit from" that directed transfer in order for the "obtaining"
element to be satisfied. Because "[a]s framed, on admitted facts,
th[is] question . . . is [only] an issue of law," our review is de
novo. Musso, 914 F.3d at 30.
A.
"We begin where all such inquiries must begin: with the
language of the statute itself." Caraco Pharm. Labs., Ltd. v.
Novo Nordisk A/S, 566 U.S. 399, 412 (2012). The Hobbs Act
extortion provision does not refer to the defendant's "obtaining"
of anything other than "property from another." 18 U.S.C.
§ 1951(b)(2). The "obtaining of property" element does not on its
face, therefore, require the government to prove that the defendant
received a personal benefit, at least insofar as the government
otherwise may show that the defendant "obtain[ed]" what the statute
refers to as "property."
The defendants nevertheless contend that the
text -- apparently through the use of the word "obtaining"
itself -- impliedly imposes that "personal benefit" requirement in
a circumstance in which the defendant is charged only with having
"induce[d]" the victim's "consent" to transfer "property" to an
identified third party. Id. But, when we focus on the possible
meaning of the word "obtaining," we see no reason to import such
a "personal benefit" requirement into the text.
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The Hobbs Act does not define either the word "obtaining"
or the broader phrase, "obtaining of property," in which it
appears. See id. We thus follow the interpretive approach that
the United States Supreme Court used in Scheidler v. Nat'l Org.
for Women, Inc., 537 U.S. 393 (2003), in an attempt to discern the
meaning of "obtaining." There, the Court was similarly confronted
with a contention that the "obtaining of property" element in the
Hobbs Act extortion provision did not encompass the conduct for
which the defendants had been charged. See id. at 404. The Court
proceeded by looking to the common-law crime of extortion, which
in turn led the Court to consider how the Model Penal Code ("MPC")
defined extortion and its "obtaining of property" element. See
id. at 408 & n.13 (quoting Model Penal Code § 223.3, cmt. 2, at
182).
The MPC definition of extortion, as it turns out,
expressly defines "obtaining" -- as the Court noted in Scheidler.
See id. The MPC does so by defining "obtaining" -- again, as
Scheidler notes -- as "bring[ing] about a transfer or purported
transfer of a legal interest in the property, whether to the
obtainer or another." Id. (emphasis added) (alterations in
original) (quoting Model Penal Code § 223.3, cmt. 2, at 182). The
MPC definition of "obtaining" quoted by Scheidler expressly
provides that it encompasses conduct in which a defendant brings
about a transfer of property to a third party rather than to
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himself. See id. (quoting Model Penal Code § 223.3, cmt. 2, at
182). That definition does so, moreover, without purporting to
require in such a circumstance that the defendant who brings about
that transfer to a third party receive a personal benefit in
consequence. In other words, the word "obtaining," as used in the
MPC definition of extortion, does not impliedly contain the
personal benefit requirement that the defendants contend is
impliedly contained in the word "obtaining" in the Hobbs Act
extortion provision.
We recognize that Scheidler was not concerned with
determining whether or when a transfer of property to a third
party, effected at the defendant's direction, could satisfy the
"obtaining of property" element. But, the fact that the text of
the MPC definition of extortion to which the Court looked in
construing the "obtaining of property" element of Hobbs Act
extortion imposes no "personal benefit" requirement in such a
scenario strongly counsels against the defendants' position that
such a requirement must be lurking in the Hobbs Act. Nothing in
Scheidler -- nor in any other precedent -- suggests that Congress
intended the Hobbs Act to codify a form of extortion different,
with respect to the "obtaining of property" element, from the
common-law form of extortion defined by the MPC. See id. at 402–
03 ("While the Hobbs Act expanded the scope of common-law extortion
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to include private individuals, the statutory language retained
the [common-law] requirement that property must be 'obtained.'").
The surrounding context of the word "obtaining" in the
Hobbs Act's extortion provision reinforces this conclusion. See
Davis v. Michigan Dep't of Treasury, 489 U.S. 803, 809 (1989) ("It
is a fundamental canon of statutory construction that the words of
a statute must be read in their context and with a view to their
place in the overall statutory scheme."). The text provides that
it is "property" and not a benefit that the defendant must
"obtain[] . . . from another." 18 U.S.C. § 1951(b)(2). Whether a
defendant receives a "personal benefit" thus would not appear to
provide a means of distinguishing between transfers of property to
third parties directed by the defendant that would satisfy the
"obtaining of property" element and those that would not.
B.
When we turn to Hobbs Act extortion precedents that
directly address the application of the statute's "obtaining of
property" element to circumstances in which the defendant is
alleged to have directed the transfer of property to a third party,
we find further reason to doubt that the element requires proof
that the defendant received a "personal benefit" from such a
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transfer. We start with United States v. Green, 350 U.S. 415
(1956).
There, a union and its representative were charged with
extorting from employers "wages to be paid for imposed, unwanted,
superfluous and fictitious services" of members of the union other
than themselves. Id. at 417. In rejecting the view that "the
Hobbs Act covers only the taking of property from another for the
extortioner's personal advantage," Green concluded that "extortion
as defined in the [Hobbs Act] in no way depends upon having a
direct benefit conferred on the person who obtains the property."
Id. at 418, 420 (emphasis added).
The defendants are right that the transfer of property
that the defendants induced in Green was to members of a union to
which the defendants belonged. They are also right that the
defendants here were not members or agents of the union from which
Crash Line was allegedly forced to hire "additional" workers for
the music festival. But, the Court did not indicate in Green that
it intended to limit its categorical statement rejecting a "direct
benefit" requirement to the particular circumstance in which the
defendant is also a member of the union whose members he forces
the extortion victim to hire. Id. at 420.5
5 We note that the extortion at issue in Green was carried
out "through threats of force or violence," Green, 350 U.S. at
420, rather than through the "wrongful use of . . . [economic]
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Nor does the Supreme Court's more recent decision
concerning the "obtaining of property" element in Sekhar v. United
States, 570 U.S. 729 (2013), demonstrate, as the defendants suggest
that it does, that the element cannot encompass a directed transfer
of property to a third party in the absence of the defendant
thereby receiving a personal benefit. Sekhar did hold, as the
defendants note, that the Hobbs Act extortion provision's
"obtaining of property" element requires proof of
"the acquisition of property" -- "[t]hat is," proof that "the
victim part[ed] with his property, and that the extortionist
gain[ed] possession of it." Id. at 735 (internal quotation marks
and citations omitted). But, we do not see how that part of Sekhar
precludes the conclusion that a defendant may "acqui[re]" property
within the meaning of Sekhar by directing its transfer from the
victim to a party of his choosing, notwithstanding that he does
not otherwise personally benefit from the transfer.
Sekhar contains no suggestion that it reads the Hobbs
Act to codify a form of extortion that, with respect to the
"obtaining of property" element, is distinct from the one set forth
fear," 18 U.S.C. § 1951(b)(2). Thus, Green had no occasion to
address whether -- in a case not involving "force or
violence" -- its categorical statement disclaiming a "direct
benefit" requirement might bear on the separate "wrongful[ness]"
element of Hobbs Act extortion, notwithstanding that the forced
payment of wages to "additional" third-party laborers without any
"direct benefit" to the defendant otherwise satisfies the
"obtaining of property" element.
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in the version of the MPC quoted by Scheidler. See id. (quoting
Scheidler, 537 U.S. at 404, for the proposition that "obtaining
property requires not only the deprivation but also the acquisition
of property"). Thus, the fact that the MPC extortion provision
quoted in Scheidler defines "obtaining" to encompass a defendant's
"bring[ing] about a transfer
of . . . property . . . to . . . another," Scheidler, 537 U.S. at
408 n.13 (emphasis added) (quoting Model Penal Code § 223.3, cmt.
2, at 182), suggests that no such personal benefit from a directed
transfer of property to a third party is necessary to effectuate
"the acquisition of property" that Sekhar requires, see Sekhar,
570 U.S. at 734.
In addition, the only circuits to have squarely
addressed this question -- including one that has done so in the
wake of Sekhar -- have each held that a defendant does acquire the
property at issue, within the meaning of the "obtaining" element,
by directing its transfer to another of his choosing, irrespective
of whether he receives a personal benefit as a result. See United
States v. Carlson, 787 F.3d 939, 944 (8th Cir. 2015) (finding the
"obtaining of property" element met where the defendant "did demand
items of value, she just did not seek to obtain them for herself"
(emphasis omitted)); United States v. Vigil, 523 F.3d 1258, 1264
(10th Cir. 2008) (holding that the "obtaining of property" element
was met where a state treasurer "attempted to obtain money from [a
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company's head] and direct that money to [a political supporter's
wife]"); United States v. Gotti, 459 F.3d 296, 324 n.9 (2d Cir.
2006) (noting that a defendant may obtain property by "order[ing]
the victim to transfer the [victim's property] rights to a third
party of the extortionist's choosing" (emphasis added)); United
States v. Panaro, 266 F.3d 939, 943 (9th Cir. 2001) (explaining
that under the Hobbs Act, "someone -- either the extortioner or a
third person -- must receive the property of which the victim is
deprived" (emphasis added)); United States v. Provenzano, 334 F.2d
678, 686 (3d Cir. 1964) (noting that "[i]t is enough [under the
Hobbs Act] that payments were made at the extortioner's direction
to a person named by him" (emphasis added)). This same conclusion
accords with -- even though it is not compelled by -- our decision
in Burhoe, insofar as it addressed the "obtaining of property"
element. See Burhoe, 871 F.3d at 27-28 (noting that a union leader
taking work away from one union member and giving it to a different
union member could potentially be an "obtaining of property").
C.
The defendants do point to one last set of precedents
that they contend supports their contention that -- at least where
the defendant is alleged to have directed the victim's transfer of
property to a third party -- the defendant must have received a
personal benefit from the transfer in order to have "obtain[ed]"
the property at issue. These so-called "under color of official
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right" Hobbs Act extortion cases require proof of "the sale of
public favors for private gain," Wilkie v. Robbins, 551 U.S. 537,
564 (2007) (emphasis added), or proof of there being a quid pro
quo, see, e.g., Evans, 504 U.S. at 267-68; McCormick v. United
States, 500 U.S. 257, 273 (1991).
But, the Court did not hold in any of those cases that
the "obtaining of property" element requires proof that the
defendant received a personal benefit separate and apart from
having "br[ought] about a transfer of . . . property
to . . . another." Scheidler, 537 U.S. at 408 n.13 (emphasis
added) (quoting Model Penal Code § 223.3, cmt. 2, at 182). The
Court simply had no reason to address that distinct issue in any
of those cases because the facts in each were such that the
property alleged to be "obtain[ed]" was transferred from the victim
directly to the defendant. See, e.g., Evans, 504 U.S. at 257
(public official received $7,000 from a real estate developer in
exchange for voting in favor of the developer's rezoning
application).
Moreover, the passages from these cases on which the
defendants rely do not even concern the "obtaining of property"
element of the Hobbs Act extortion provision that is our concern
here. They concern the statute's "under color of official right"
element, 18 U.S.C. § 1951(b)(2), which the indictment in this case
does not implicate. See id. at 268 n.20 ("[T]he requirement that
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the payment must be given in return for official acts . . . is
derived from the statutory language 'under color of official
right,' which has a well-recognized common-law heritage that
distinguished between payments for private services and payments
for public services." (emphasis added)); Wilkie, 551 U.S. at 565
(holding that "efforts of Government employees to get property for
the exclusive benefit of the Government" do not qualify as
extortion "under color of official right"). Thus, these precedents
have no bearing on the issue before us, which concerns solely the
meaning of the "obtaining of property" element.
D.
In sum, we reject the contention that a defendant
"obtain[s] . . . property" within the meaning of the Hobbs Act
extortion provision by "bring[ing] about [its] transfer . . . to
another," Scheidler, 537 U.S. at 408 n.13 (quoting Model Penal
Code § 223.3, cmt. 2, at 182), only if the defendant receives a
personal benefit in consequence. In doing so, we align ourselves
with the only other circuits to have resolved that same question.
See, e.g., Provenzano, 334 F.2d at 686 (holding that "it is not
necessary to prove that the extortioner himself, directly or
indirectly, received the fruits of his extortion or any benefit
therefrom"); United States v. Hyde, 448 F.2d 815, 843 (5th Cir.
1971) ("One need receive no personal benefit to be guilty of
extortion; the gravamen of the offense is loss to the victim."
- 22 -
(citing Provenzano, 334 F.2d at 686)); Panaro, 266 F.3d at 943
(quoting Provenzano, 334 F.2d at 686; Hyde, 448 F.2d at 843).
IV.
The defendants do separately press an alternative ground
for affirming the indictment's dismissal, which appears not to
depend on whether the "obtaining of property" element contains a
personal benefit requirement. The defendants point out that Sekhar
held that blackmailing the general counsel of a company into making
a recommendation to approve a particular investment did not amount
to an "obtaining of property" within the meaning of the Hobbs Act
extortion provision. See Sekhar, 570 U.S. at 737-38. The
defendants emphasize that the Court came to that conclusion after
determining that the defendant's "goal" in that case "was not to
acquire the general counsel's intangible property right to give
disinterested legal advice[,] [but] was to force the general
counsel to offer advice that accorded with [the defendant's]
wishes." Id. at 738 (emphasis added) (internal quotation marks
omitted). The defendants assert that their case is no different
than Sekhar, as the indictment alleged no more than that they
"force[d] [Crash Line] to [hire workers] that accorded with [their]
wishes." Id. (emphasis added).
As the defendants put it, in light of Sekhar, the facts
proffered and alleged in the indictment "fail[] to establish that
Defendants 'directed' the wages and benefits to anyone, much less
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to an 'identified third party,'" such that the defendants
"obtain[ed]" them within the meaning of the Hobbs Act extortion
provision. That is because, the defendants contend, the
allegations establish, at most, only that the defendants procured
"the opportunity for a set number of union members to perform real
work at an upcoming event" and not that the defendants "sent over"
property in the form of "wages and benefits" to those union
members.
The District Court did not resolve this precise
question, as it based its ruling solely on the conclusion that
there was a personal benefit requirement where a defendant directs
the victim to transfer the property to a third party. But, the
District Court did dismiss the indictment on the ground that "the
government cannot prove the defendants obtained the property at
issue as required." We thus see no reason to leave this
alternative ground for affirmance unaddressed. It undoubtedly
relates to whether "the government can[] prove the defendants
obtained the property at issue . . . ." The defendants have fully
briefed it on appeal.6 See Oxford Aviation, Inc. v. Glob.
6
The defendants also seem to have made this argument below
in defending its interpretation of the "obtaining of property"
element. The defendants argued in the opposition to the
government's motion for emergency reconsideration of the District
Court's proposed jury instructions, for example, that "this case
involves wages and benefits that were paid directly to union
members that are not affiliated with the defendants [and] [t]he
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Aerospace, Inc., 680 F.3d 85, 87–88 (1st Cir. 2012) ("[An appellee]
is entitled to defend a judgment on any adequately preserved ground
that supports that judgment even if the district judge
ignored . . . that ground."). It also presents a question of law
that would otherwise arise on remand.
In taking up this issue, we begin by looking to Sekhar
itself. Sekhar did cite as an example of the common-law crime of
coercion, which contains no "obtaining of property" element,
People v. Scotti, 195 N.E. 162 (N.Y. 1934). There, the defendants
were convicted of coercion under New York law for "compelling [the]
victim to enter into [an] agreement with [a labor] union." Sekhar,
570 U.S. at 735. Sekhar concluded that this conduct -- along with
"compelling [a] store owner to become a member of a trade
association and to remove advertisements" from his storefronts,
see People v. Ginsberg, 188 N.E. 62 (N.Y. 1933) (per curiam), and
"compelling union members to drop lawsuits against union
leadership," see People v. Kaplan, 240 A.D. 72, 74-75 (N.Y. App.
Div.), aff'd, 191 N.E. 621 (N.Y. 1934) -- was the "sort of [mere]
wages and benefits were only paid after the union members earned
them by performing actual services for Crash Line." And, the
defendants' proposed jury instructions would have explained that
"[i]t is not enough for the government to prove that the defendant
controlled the money to be paid as wages and benefits and received
an unidentifiable benefit from that control" and that "[m]erely
interfering with or depriving another of property is not sufficient
to show that the defendants obtained Crash Line's property."
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interference with rights" that Congress chose to leave outside the
scope of the Hobbs Act extortion provision by including the
"obtaining of property" element. Sekhar, 570 U.S. at 735.7
The defendants do not dispute, though, that the Supreme
Court's pre-Sekhar precedents make clear that Congress intended
the Hobbs Act to extend to -- and thus necessarily for its
"obtaining of property" element to be satisfied by -- the "use
of . . . extortion under the guise of obtaining wages in the
obstruction of interstate commerce." United States v. Enmons, 410
U.S. 396, 403 (1973) (emphasis added) (quoting 91 Cong. Rec. 11,900
(1945) (remarks of Rep. Hancock)); see also United States v.
Kemble, 198 F.2d 889, 891 (3d Cir. 1952) ("[T]he conclusion seems
inescapable that Congress intended that the language used in the
[Hobbs Act] be broad enough to include, in proper cases, the forced
payment of wages."). After all, the Supreme Court made it quite
clear in Enmons that "the Hobbs Act has properly been held to reach
instances where union officials threatened force or violence
against an employer in order to . . . exact 'wage' payments from
7 Sekhar also cited the case of King v. Burdett, 91 Eng. Rep.
996 (K.B. 1696), in which a farmer was convicted of the common-
law crime of extortion for "taking money from the market people
for rent for the use of the little stalls in the market." Id. at
966; see Sekhar, 570 U.S. at 733. Sekhar noted that Burdett found
the conduct to be extortionate not because the defendant's conduct
deprived the market people of "free liberty to sell their wares in
the market according to law," but because it effectuated "the
taking of money for the use of the stalls." Id. at 733 (quoting
Burdett, 91 Eng. Rep. at 996).
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employers in return for 'imposed, unwanted, superfluous and
fictitious services' of workers." Enmons, 410 U.S. at 400 & n.4
(emphasis added) (citing Green, 350 U.S. at 417; Kemble, 198 F.2d
at 889). "[I]n those situations," the Court concluded, "the
employer's property has been misappropriated." Id. at 400. Nor
do the defendants contend that Sekhar -- silently -- superseded
this established line of Hobbs Act extortion precedent. See
Sekhar, 570 U.S. at 734 (quoting Scheidler, 537 U.S. at 404 (citing
Enmons, 410 U.S. at 400)); see also Agnostini v. Felton, 521 U.S.
203, 237 (1997) (cautioning "other courts" against "conclud[ing]
[that] more recent cases [of the Supreme Court] have, by
implication, overruled an earlier precedent").
The defendants' only response to the Enmons line of
precedent -- insofar as they contend that Sekhar independently
compels us to affirm the dismissal of the indictment -- is that it
has no application here. They argue that, for this line of
precedent to apply, such that we could conclude that the
allegations in the indictment satisfy the "obtaining of property"
element even if we set aside the personal benefit requirement,
"the government must allege and prove that the work [that Crash
Line was forced to pay for] was 'fictitious' in addition to being
'imposed, unwanted and superfluous.'"
In fact, the defendants argue that our decision in
Burhoe, 871 F.3d at 20, compels the conclusion that the wages at
- 27 -
issue must have been exacted for fictitious -- rather than
actual -- work in order for the "obtaining of property" element to
be satisfied. Yet, the defendants contend, the facts proffered by
the government and those alleged in the indictment show only that
the "payments" at issue "were made directly to union members with
no connection to the defendants after they earned the money by
performing actual, bargained-for services at the concert." Thus,
the defendants contend, notwithstanding the Enmons line of
precedent, there is no adequate allegation that the defendants
"directed" the wages and benefits to an "identified third party,"
such that the defendants "obtain[ed]" them within the meaning of
the Hobbs Act extortion provision.
But, insofar as Burhoe addressed the distinction between
the exaction of wages for fictitious and for real work, it did so
only in connection with deciding whether the defendants' alleged
conduct was "wrongful" within the meaning of the Hobbs Act
extortion provision, see 18 U.S.C. § 1951(b)(2), and then only in
connection with the specific jury instructions that had been given
in that case. See Burhoe, 871 F.3d at 17, 19. Burhoe did not
purport to resolve the separate question, and the only one that we
decide here, whether evidence of the forced payment of wages for
actual -- rather than for merely fictitious -- work can satisfy
the "obtaining of property" element.
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Moreover, a review of the precedents that we considered
in Burhoe, which concerned Hobbs Act extortion charges for the
exaction of wages and benefits for union members, reveals the
problem with the defendants' contention that the "obtaining"
element requires proof that the wages were exacted for fictitious
rather than real work. As we explained in Burhoe, the predecessor
to the Hobbs Act -- the Anti-Racketeering Act of 1934 -- excepted
from its reach "the payment of wages of a bona-fide employer to a
bona-fide employee." Id. at 18 (quoting Act of June 18, 1934, ch.
569, § 2, 48 Stat. 979, 980). But -- as we noted in Burhoe, see
id., and as the Court observed in Green, see 350 U.S. at 419 n.5,
Enmons, see 410 U.S. at 402, and Scheidler, see 537 U.S. at
407 -- Congress, in enacting the Hobbs Act in 1946, deliberately
removed the bona-fide employer-employee exception "so as to change
the terms which brought about the result reached in [United States
v. Local 807, Int'l Bhd. of Teamsters, 315 U.S. 521 (1942)]."
Green, 350 U.S. at 419 n.5.
This history is instructive. As we noted in Burhoe and
as the Court noted in Scheidler, Local 807 involved the violent
exaction of wages both for actual services performed and for
fictitious work. See Burhoe, 871 F.3d at 18 (citing Local 807,
315 U.S. at 526); Scheidler, 537 U.S. at 407 (noting that the money
exacted by the "union truckdrivers" in Local 807 was "in return
for undesired and often unutilized services" (emphasis added)
- 29 -
(citations and internal quotation marks omitted)). The Court did
not suggest in Local 807, however, that whether the defendants'
conduct in exacting such wages qualified as an "obtain[ing]
of . . . property" turned on whether or not the work was performed.
See Local 807, 315 U.S. at 534 ("We do not mean [to suggest] that
an offer to work or even the actual performance of some services
necessarily entitles one to immunity under the exception."). The
Hobbs Act's intent to "reverse the result in" Local 807, see
Scheidler, 537 U.S. at 407, thus suggests that "the Hobbs Act was
meant to stop just such conduct" as Local 807 concerned -- that
is, "trying by force to get jobs and pay from [a non-union entity]
by threats and violence," Green, 350 U.S. at 420 (emphasis added),
even where "union members [] perform or seek actual work" for the
exacted pay, Burhoe, 871 F.3d at 18 (emphasis added) (citing Local
807, 315 U.S. at 526). And because the Hobbs Act could do so only
if such conduct satisfied its "obtaining" element, we do not see
how this line of precedent may be squared with the defendants'
alternative argument for upholding the District Court's dismissal
of the indictment. See Scheidler, 537 U.S. at 404 (quoting Enmons,
410 U.S. at 400, for the proposition that "[e]xtortion under the
Hobbs Act requires a '"wrongful" taking of . . . property'"
(emphasis and alterations in original)).
The defendants are correct that "the indictment that the
Court blessed [in Green] required that the work be 'fictitious' in
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order for Hobbs Act liability to attach." Burhoe, 871 F.3d at 15
(citing Green, 350 U.S. at 417). But, as we noted in Burhoe, "the
fact that Green rejected a challenge to a Hobbs Act indictment
charging the defendants in that case with seeking fictitious work
does not necessarily mean that a showing of fictitiousness is
required to prove that union efforts to obtain work for its members
constitutes extortion under the Hobbs Act." Id. at 16 (citing
Green, 350 U.S. at 417).
Burhoe shows why that is so, moreover. It noted that
the Enmons Court cited Kemble approvingly as "as a proper
application of the Hobbs Act." See id. at 19 (citing Enmons, 410
U.S. at 400 & n.5, 409 (citing Kemble, 198 F.2d at 892)). In
Kemble, the Third Circuit concluded that the Hobbs Act extortion
provision -- and thus its "obtaining of property
element" -- encompassed the conduct of a union agent who,
"understanding that [a driver] did not want or need a helper and
was not authorized to employ one, nevertheless forcibly insisted
that [the driver] pay $10, described as a day's wages, for a
supernumerary to do what [the driver] himself was paid to do and
was accomplishing when [the union agent] intervened." Kemble, 198
F.2d at 890. Kemble held that such forced "payment of money for
imposed, unwanted and superfluous services . . . by violent
obstruction of commerce is within the language" of the Hobbs Act
extortion provision, which, of course, includes the "obtaining of
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property" element.8 Id. at 892. Thus, Enmons, by virtue of its
favorable citation to Kemble, further supports the conclusion that
the "obtaining of property" element may be satisfied by a forced
transfer of wages and benefits to a third party for actual rather
than merely fictitious labor.
Sekhar was, of course, decided after Kemble, Enmons, and
Scheidler. But, Sekhar gives no indication that it meant to limit
the reach of those decisions with respect to the "obtaining of
property" element. In fact, consistent with that conclusion, the
Second Circuit recently rejected a defendant's "Sekhar-based
challenge" by holding that the "obtaining of property" element was
met where the president of a local union "used threats of violence
and destruction of property in an attempt to force contractors to
hire members of his union" to perform real rather than fictitious
work. United States v. Kirsch, 903 F.3d 213, 216, 225 (2d Cir.
2018), cert. denied, No. 18-892, 2019 WL 888142 (U.S. Feb. 25,
2019). In doing so, the Second Circuit explained that the
defendant "sought to extort property that Local 17 members could
8
As we noted in Burhoe, with respect to wrongfulness, "the
holding in Kemble is limited by the fact that the union's agent
engaged in violent conduct that was nowhere sanctioned by federal
or state law." Burhoe, 871 F.3d at 19. But, the clear import of
Kemble is that such a situation is otherwise considered an
"obtaining of property" under the Hobbs Act extortion provision.
- 32 -
clearly 'obtain': wages and benefits from construction
contractors."9 Id. at 225, 227.
V.
The government has charged two public officials on a
novel theory of Hobbs Act extortion. Given the stakes, the parties
"requested a pretrial ruling on a dispositive legal question that
the parties ha[d] substantially explored in briefs and oral
argument [for] over [a] year." In resolving that legal question
on appeal, which concerns only the meaning of "obtaining of
property," we express no view as to whether the indictment
sufficiently alleges the other elements of Hobbs Act extortion or
whether the government would ultimately be able to prove its case
beyond a reasonable doubt were it to proceed to trial. Thus, we
express no view as to whether, for example, the defendants' conduct
was "wrongful," as it must be under the statute, given that they
are charged with the variant of Hobbs Act extortion that requires
proof of the "wrongful use of . . . fear [of economic harm]" to
9The Second Circuit was interpreting the "obtaining of
property" element in "[t]he 'generic' definition of extortion
applicable to RICO state law extortion predicate acts," which it
concluded was "nearly identical" to "the Hobbs Act definition of
extortion" and was thus governed by the Supreme Court's decision
concerning Hobbs Act extortion in Sekhar. Id. at 225.
- 33 -
"induce[]" the victim's "consent" to the transfer of property at
issue. See 18 U.S.C. § 1951(b)(2).
We are mindful, though, that the defendants are local
officials who have been charged under a federal criminal statute
for using their putative permitting authority to benefit others
without personally receiving any gain. We are mindful, too, of
the concerns expressed by the Supreme Court that an overly broad
application of the Hobbs Act could unduly chill official conduct.
See, e.g., McDonnell v. United States, 136 S. Ct. 2355, 2372
(2016); Wilkie, 551 U.S. at 567; McCormick, 500 U.S. at 272.
The defendants have been charged, moreover, with conduct
that is, as a factual matter, quite distinct from other "wrongful
use[s] of . . . fear," a quintessential example of which, the
Supreme Court has explained, is "a store owner mak[ing] periodic
protection payments to gang members out of fear that they will
otherwise trash the store." Ocasio v. United States, 136 S. Ct.
1423, 1435 (2016). And, the defendants have been charged with
threatening "fear of economic harm" -- a "type of fear," we have
explained, that "is not necessarily 'wrongful' for Hobbs Act
purposes." Burhoe, 871 F.3d at 9 (citations omitted). In fact,
just as "fear of economic harm is part of many legitimate business
transactions," fear of economic harm may also be a necessary
consequence of many legitimate exercises of official authority.
- 34 -
Id. (citations omitted).10 In the end, whether "[t]he use of
economic fear" is "wrongful" within the meaning of the Hobbs Act
extortion provision turns, at least in part, on whether it was
"employed to achieve a wrongful purpose." Id. (internal quotation
marks omitted).
Neither the District Court nor the parties on appeal
have addressed the "wrongful[ness]" element.11 We also have not
had previous occasion to address whether that element is met in
circumstances resembling the conduct that is alleged in the
indictment here, which concern the use of economic fear by
government officials to secure real work for members of a specific
union and for which the officials would receive no personal gain.
We thus confine our holding to the element of the offense that is
the sole focus of the parties' arguments to us -- namely, the
statute's "obtaining of property" element. And we
10By contrast, "we have made clear that the use of actual or
threatened violence or force is 'inherently wrongful,' as is the
use of fear of physical harm." Id. (quoting United States v.
Sturm, 870 F.2d 769, 773 (1st Cir. 1989), and citing United States
v. Kattar, 840 F.2d 118, 123 (1st Cir. 1988)).
11 We note that, below, the defendants raised the issue of
wrongfulness, as we interpreted that element in Burhoe, in their
renewed motion to dismiss the indictment, and the government argued
that the superseding indictment sufficiently alleged the element
of wrongfulness. The District Court denied that motion to dismiss
as to the "wrongful[ness]" and "obtaining" elements as "turn[ing]
on facts beyond the [third] superseding indictment which the Court
cannot consider at this time." That order, however, is not at
issue in this appeal.
- 35 -
conclude -- contrary to the District Court -- that this element
may be satisfied by evidence showing that the defendants induced
the victim's consent to transfer property to third parties the
defendants identified, even where the defendants do not incur any
personal benefit from the transfer and even where the transfer
takes the form of wages paid for real rather than fictitious work.
The District Court's order of dismissal is vacated, and
the matter is remanded for further proceedings consistent with
this opinion.
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