United States v. Mills

RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit Rule 206
ELECTRONIC CITATION: 2000 FED App. 0072P (6th Cir.)
File Name: 00a0072p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
_________________
;

UNITED STATES OF AMERICA,

Plaintiff-Appellant,


No. 98-6179
v.

>
ALTON RAY MILLS and 

Defendants-Appellees. 
STEPHEN D. TOARMINA,

1
Appeal from the United States District Court
for the Western District of Tennessee at Memphis.
No. 96-20080—Jerome Turner, District Judge.
Argued: December 16, 1999
Decided and Filed: February 28, 2000
Before: NELSON and DAUGHTREY, *Circuit Judges;
DOWD, District Judge.
*
The Honorable David D. Dowd, Jr., United States District Judge for
the Northern District of Ohio, sitting by designation.
1
2 United States v. Mills, et al. No. 98-6179
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COUNSEL
ARGUED: Dan L. Newsom, ASSISTANT UNITED
STATES ATTORNEY, SENIOR LITIGATION COUNSEL,
Memphis, Tennessee, for Appellant. A. C. Wharton, Jr.,
WHARTON, WHARTON & ASSOCIATES, Memphis,
Tennessee, James R. Garts, Jr., HARRIS, SHELTON,
DUNLAP & COBB, Memphis, Tennessee, for Appellees.
ON BRIEF: Dan L. Newsom, ASSISTANT UNITED
STATES ATTORNEY, SENIOR LITIGATION COUNSEL,
Memphis, Tennessee, for Appellant. A. C. Wharton, Jr.,
WHARTON, WHARTON & ASSOCIATES, Memphis,
Tennessee, James D. Causey, CAUSEY, CAYWOOD,
TAYLOR, MCMANUS & BAILEY, Memphis, Tennessee,
James R. Garts, Jr., James D. Wilson, HARRIS, SHELTON,
DUNLAP & COBB, Memphis, Tennessee, for Appellees.
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OPINION
_________________
DAVID A. NELSON, Circuit Judge. This is an appeal by
the government from a judgment of acquittal on certain
Hobbs Act charges and related conspiracy and money
laundering counts of which a jury had found the defendants
guilty. The question presented is whether the defendants’
conduct – conduct that involved the solicitation and
acceptance of bribes for appointments to deputy sheriff
positions in Shelby County, Tennessee – affected interstate
commerce, thereby giving rise to federal jurisdiction under the
Hobbs Act. Because one or more of the conspirators involved
in the solicitation of the bribes had actual knowledge that the
bribe money would be obtained through loans made in
interstate commerce, we answer this question in the
affirmative. The judgment of acquittal will be reversed.
No. 98-6179 United States v. Mills, et al. 3
I
Defendant Alton Ray Mills was the Chief Deputy Sheriff of
the Shelby County Sheriff’s Department. Defendant Stephen
D. Toarmina held the title of Staff Special Deputy in the
Department. During the early 1990s, defendant Toarmina or
an intermediary approached a number of young men with
offers to see that “the man downtown” – who proved to be
defendant Mills – would appoint them as full-time deputy
sheriffs in exchange for the payment of bribes of
approximately $3,500 for each position. Six of the young
men accepted this deal, paid the bribes, and were
subsequently hired by Mills.
All six of the aspiring deputy sheriffs were in their early
20s, and none had cash resources adequate to pay the sums
demanded. Defendant Toarmina or one of his co-conspirators
encouraged each of the young men to borrow the money from
a Memphis loan company – First Metropolitan Financial
Services, Inc. – with which Toarmina had an ongoing
relationship. It is undisputed that the business of First
Metropolitan was interstate in character.
Five of the six young men accepted Toarmina’s suggestion,
signing First Metropolitan loan forms on which Toarmina was
listed as “source” or “reference.” First Metropolitan approved
all five of the loan applications, notwithstanding that some of
the applicants had negative credit references, and Toarmina
personally co-signed at least one of the notes. The sixth
individual, Derick Feathers, elected not to do business with
First Metropolitan; he raised the bribe money by taking
advances on his credit cards.
All of the funds in question were turned over to Toarmina,
who deposited the money in the bank account of a
commercial enterprise called the Toarmina Grocery and
Market. The assets of the grocery business were subsequently
used by Messrs. Toarmina and Mills to satisfy personal
obligations.
4 United States v. Mills, et al. No. 98-6179 No. 98-6179 United States v. Mills, et al. 9
In April of 1996 a federal grand jury handed up an 18-count Feathers advised that he did not have the money. He advised
indictment charging Toarmina and Mills with a variety of that he could get some cash advances on his credit cards,
offenses. Count 1 charged the two officials with conspiracy which he did.”
between themselves and with other persons (known and
unknown to the grand jury) to commit crimes that included It is true that the borrowing of the money from interstate
affecting interstate commerce by extortion in violation of the lenders could not have been expected to “interfere” with
Hobbs Act, 18 U.S.C. § 1951. The original indictment did interstate commerce. We are satisfied, however, that the
not give the names of the unindicted co-conspirators known effect on commerce need not be adverse; even a beneficial
to the grand jury, but these names – which included the effect can satisfy the statute. See Mattson, 671 F.2d at 1024.
names of the six young men referred to above – were later In exercising its constitutional power to regulate commerce
set forth in a bill of particulars. Other counts of the among the several states, Congress often prohibits conduct
indictment charged the defendants with soliciting and that would have a stimulative effect on commerce as opposed
accepting bribes in violation of 18 U.S.C. § 666, with to a depressive effect. And the Hobbs Act applies wherever
specified extortionate acts violating the Hobbs Act, and with extortion “in any way or degree . . . affects commerce . . . .”
money laundering in violation of 18 U.S.C. § 1956(a). (Emphasis supplied.)
The district court granted a pre-trial motion to dismiss the The judgment of acquittal is REVERSED, and the case is
bribery counts on the ground that the transactions at issue did REMANDED for the entry of judgment in accordance with
not meet the $5,000 threshold specified in 18 U.S.C. § 666. the jury’s verdict.
The government took an interlocutory appeal, and in United
States v. Mills, 140 F.3d 630 (6th Cir. 1998), this court
affirmed the dismissal of the bribery counts. The case
subsequently went to trial on the counts that remained.
Pursuant to Rule 29, Fed. R. Crim. P., the defendants
moved for a judgment of acquittal. The district court allowed
the case to go to the jury, but informed the parties outside the
presence of the jury that the motion would be granted with
respect to the counts at issue here. The jury returned verdicts
of guilty on all counts, and, for reasons explained by the
district court on the record, the court followed through on its
earlier promise to grant acquittals. The government has
perfected a timely appeal.
II
The Hobbs Act provides, in relevant part, that
“Whoever in any way or degree obstructs, delays, or
affects commerce . . . by robbery or extortion or attempts
or conspires so to do . . . shall be fined under this title or
8 United States v. Mills, et al. No. 98-6179 No. 98-6179 United States v. Mills, et al. 5
The government apparently argued that resort to company imprisoned not more than twenty years, or both.” 18
assets was not in fact unlikely, most of Mr. Allen’s personal U.S.C. § 1951(a).
assets having been illiquid. The Fourth Circuit was not
impressed by this argument, pointing out that Allen had easy As used in this section, “commerce” is defined in terms that
access to certificates of deposit. “[E]ven aside from these include all commerce between any point within a state and
assets,” the court added, “we rely on the fact that, when any point outside the state, as well as “all other commerce
pressed at oral argument, the government could offer no over which the United States has jurisdiction.” 18 U.S.C.
convincing explanations as to why Allen could not easily § 1951(b)(3).
secure a loan against his ample non-liquid assets.” Id. The
Fourth Circuit’s opinion contains no discussion of whether The Supreme Court has made it clear that the Hobbs Act’s
such a loan would itself have been likely to affect interstate broad jurisdictional language is to be read as meaning what it
commerce. says:
In the case at bar, advancing an argument of a sort “[The] Act speaks in broad language, manifesting a
apparently not made in Mattson or Buffey, the government purpose to use all the constitutional power Congress has
contends that the requisite effect on interstate commerce has to punish interference with interstate commerce by
been demonstrated here because the proofs showed a realistic extortion, robbery or physical violence. The Act outlaws
probability that the bribe money would be borrowed from a such interference ‘in any way or degree.’ 18 U.S.C.
company engaged in interstate commerce. We find the § 1951(a).” Stirone v. United States, 361 U.S. 212, 215
government’s argument persuasive, especially in view of the (1960).
existence of substantial evidence that defendant Toarmina or
one of his co-conspirators had actual knowledge of the The maxim “de minimis non curat lex” does not apply in
interstate character of the funds before the money was turned determining whether an effect on commerce is sufficient to
over. satisfy the jurisdictional predicate of the Hobbs Act. It has
long been the understanding in this circuit that even a “de
It is clear that unlike Mr. Allen in the Buffey case, the minimis” effect on interstate commerce will suffice. See
aspiring deputy sheriffs from whom the defendants in this United States v. Peete, 919 F.2d 1168, 1174 (6th Cir. 1990)
case solicited bribes were not wealthy men. It was virtually (citing cases). Both in our circuit and others, this
certain that each of them would have to go into debt to raise understanding has survived the opinion in United States v.
the bribe money. With respect to the five young men who Lopez, 514 U.S. 549 (1995), a case dealing with the
borrowed the bribe money from First Metropolitan (at annual constitutionality of a statute that did not address interstate
percentage interest rates exceeding 30%), moreover, it is clear commerce at all. See United States v. Smith, 182 F.3d 452,
that defendant Toarmina or one of the co-conspirators who 456 (6th Cir. 1999), where we joined “[a]ll of the other
did the soliciting on his behalf had actual knowledge of the circuits that have considered the issue [in holding] that the de
source of the funds. The sixth young man, Derick Feathers, minimis standard for Hobbs Act charges survived Lopez . . . .”
found First Metropolitan’s interest rate too high, so he
borrowed the money on his credit cards. There was The government argues here, as it did before the district
uncontradicted testimony from the member of the conspiracy court, that the requisite effect on commerce was shown by
who solicited the bribe from Feathers that the conspirator (among other things) proof that there was from the outset a
knew this was where the money was coming from: “Mr. reasonable probability that the would-be deputy sheriffs –
none of whom seems to have had any appreciable savings –
6 United States v. Mills, et al. No. 98-6179 No. 98-6179 United States v. Mills, et al. 7
would borrow the bribe money from the loan company “In the case before us, it was only Anderson’s personal
recommended by defendant Toarmina or from some other assets which were depleted by the $3,000 payment: The
interstate lender, such as a credit card company. In rejecting record clearly established that Playboy never reimbursed
this argument, the district court relied primarily on two pre- Anderson for the extorted sum. We would have a
Lopez opinions from other circuits, United States v. Mattson, different case if Playboy, a business, had been the victim
671 F.2d 1020 (7th Cir. 1982), and United States v. Buffey, of the extortion instead of Anderson. But Anderson
899 F.2d 1402 (4th Cir. 1990). We are not persuaded that himself certainly was not conducting a business engaged
either of these opinions should control the decision here. in, or purchasing items from, interstate commerce. The
victim in this case was an individual who had no
Mattson involved a $3,000 bribe paid by one Donald connection with interstate commerce at all . . . .” Id. at
Anderson, a Playboy Club electrician, to secure a supervising 1024-25.
electrician’s license from the City of Chicago. Although
Anderson financed part of the bribe by taking out a personal The Seventh Circuit seems to have given no consideration to
loan, the Seventh Circuit’s opinion gives no indication that the possibility that Anderson’s borrowing of a portion of the
the government tried to hang its hat on this peg in maintaining money used for the bribe might have given him a connection
that the evidence established the necessary nexus to interstate with interstate commerce.
commerce.
The second opinion relied on by the district court, the
The Seventh Circuit acknowledged in Mattson that either Fourth Circuit’s opinion in Buffey, involved an attempt to
a direct effect on commerce or an indirect effect would supply blackmail one James Allen, a wealthy businessman who had
the requisite nexus. The court found no evidence of either been guilty of a sexual indiscretion. The defendants
type of effect, however, in the record before it. conspired to demand $20,000 for keeping quiet about Allen’s
peccadillo, and the main question before the court was
First, the Seventh Circuit said, whether the indirect effect/“depletion of assets” theory could
legitimately be applied to satisfy the Hobbs Act’s
“There was no possibility of a direct effect on interstate jurisdictional prerequisite. (“[T]he government must
commerce, because Anderson’s payment of $3,000 for an concede,” the court said, “[that] the acts [the defendants]
electrician’s license neither actually nor potentially conspired to commit would not have affected interstate
affected the purchase of electrical supplies from outside commerce directly.” Buffey, 899 F.2d at 1404.)
Illinois for use in electrical repairs in the Playboy
Building. Whether Playboy’s own staff did the work, or The company of which Mr. Allen was board chairman and
Commercial Lighting was hired, the supplies would still majority stockholder was engaged in interstate commerce, and
have to be purchased outside Illinois by Playboy or the Buffey court indicated that it would have recognized the
Commercial Lighting. Neither of these enterprises were existence of the required nexus with commerce had it been
victims of the extortion.” Id. at 1024. reasonably probable that Allen would dip into corporate funds
in order to pay the blackmailers. Because of his wealth,
Second, said the court, while the indirect effect represented however, the Fourth Circuit concluded that it was “highly
by depletion of the assets of an interstate business can be unlikely that Allen would have satisfied an extortion demand
jurisdictionally sufficient, there was no such depletion of by means of the Company’s assets rather than his personal
assets in Mattson: assets.” Id. at 1405.