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U.S. v. MANZO
636 F.3d 56 (2011)
UNITED STATES of America, Appellant
v.
Louis MANZO; Ronald Manzo.
No. 10-2489.
United States Court of Appeals, Third Circuit.
Argued January 11, 2011.
Filed: February 17, 2011.
Mark E. Coyne, Esq., Office of United States Attorney, Newark, NJ, Glenn J. Moramarco, Esq. (Argued), Office of United States Attorney, Camden, NJ, for Appellant.
Before: RENDELL, AMBRO and FISHER, Circuit Judges.
OPINION OF THE COURTFISHER, Circuit Judge. Defendants Louis Manzo ("Louis") and Ronald Manzo ("Ronald") were indicted as the result of a federal investigation into public corruption and money laundering in Hudson County, New Jersey. They were charged with, inter alia, conspiracy to commit extortion under color of official right in violation of 18 U.S.C. § 1951(a) (the "Hobbs Act") and attempted extortion under color of official right in violation of the Hobbs Act. The District Court dismissed the conspiracy and attempt charges because it concluded that neither Louis, an unsuccessful mayoral candidate, nor Ronald, his brother and campaign manager, acted "under color of official right." On appeal, the government argues that the conduct is within the scope of the Hobbs Act based on the principles underlying the inchoate crimes of attempt and conspiracy. For the reasons stated herein, we will affirm the judgment of the District Court. Specifically, we hold that acting "under color of official right" is a required element of an extortion Hobbs Act offense, inchoate or substantive, when that offense does not involve threatened force, violence or fear. I.The parties are in basic agreement on the facts. In May 2006, Solomen Dwek was arrested by the Federal Bureau of Investigation ("FBI") on bank fraud charges. He subsequently agreed to become a cooperating witness for the FBI, assisting with an investigation into public corruption. In that role, Dwek posed as a real estate developer who was looking for assistance expediting his development projects through local government processes. Dwek surreptitiously recorded many of the meetings he attended. The investigation, dubbed "Bid Rig III," resulted in the arrest of numerous Jersey City, New Jersey politicians on July 23, 2009.1 Among those arrested were Louis and Ronald Manzo (collectively, the "Manzos"). Louis was an unsuccessful Jersey City mayoral candidate in the election held on May 12, 2009. Although he had previously held public office in other capacities, he was not a public official at the relevant time here and did not pretend to be one. Ronald is the brother of Louis, and acted as his campaign manager and political advisor for the 2009 mayoral election. Two individuals who previously accepted corrupt payments from Dwek, Edward Cheatam and Maher Khalil,2 suggested that Dwek meet with Louis to protect his real estate development interests in Jersey City. Accordingly, the Manzos, Dwek and Cheatam participated in a series of six meetings, spanning from February 2009 to April 2009. Over the course of those meetings, Dwek agreed to make cash payments and illicit contributions to Louis's campaign in exchange for his future official assistance, action and influence. The Manzos accepted three cash payments from Dwek totaling $27,500 prior to the election. Dwek also agreed to pay the Manzos an additional $17,500 after Louis
was elected, in exchange for Louis's official assistance as mayor.
1. We note that several Bid Rig III defendants have pled guilty to similar charges. Other Bid Rig III cases have been stayed by the District Court pending the outcome of this appeal.
2. Cheatam served as a Commissioner on the Jersey City Housing Authority and was also the affirmative action officer for Hudson County. Khalil was an employee of the Jersey City Department of Health and Human Services.
3. For the purpose of this appeal, both Ronald and Louis are treated the same. A private citizen may be convicted of extortion under the Hobbs Act "if that private citizen either conspires with, or aids and abets, a public official in the act of extortion." United States v. Saadey, 393 F.3d 669, 675 (6th Cir.2005); see also United States v. McFall, 558 F.3d 951, 958-59 (9th Cir.2009); United States v. Tomblin, 46 F.3d 1369, 1382 (5th Cir.1995).
4. The other elements of a Hobbs Act violation were clearly met in this case. First, both parties concede that the Manzos obtained property from another with his consent. Second, the interstate commerce element is satisfied. Even though the agreement was local and the product of a government sting operation, we require only "proof of a [potential] de minimis effect on interstate commerce." United States v. Urban, 404 F.3d 754, 766 (3d Cir.2005) (discussing Lopez-Morrison-Jones analysis). We have previously found that both local and fictitious schemes satisfy the interstate commerce element of a Hobbs Act violation. See United States v. Jannotti, 673 F.2d 578, 590-94 (3d Cir.1982). Accordingly, the interstate commerce element is met here.
5. Blackstone used the phrase "by color of his office," rather than "under color of official right," which appears in the Hobbs Act. This difference is immaterial because the exact language in the Hobbs Act was likely derived from an influential treatise on the criminal law of England, written by William Hawkins, which said:
[I]t is said, [t]hat extortion in a large sense signifies any oppression under color of right; but that in a strict sense, it signifies the taking of money by any officer, by color of his office, either where none at all is due, or not so much is due, or where it is not yet due.
Evans v. United States, 504 U.S. 255, 261 n. 4, 112 S.Ct. 1881, 119 L.Ed.2d 57 (1992) (quoting 1 W. Hawkins, Pleas of the Crown 316 (6th ed. 1787)).
6. As a general rule, only public officials may be charged using the "under color of official right" theory. United States v. Kenny, 462 F.2d 1205, 1229 (3d Cir.1972). However, we do not assert that a candidate for public office may never violate the Hobbs Act by acting "under color of official right." Indeed, the Supreme Court has considered a Hobbs Act question involving a candidate for re-election to public office. In McCormick v. United States, 500 U.S. 257, 111 S.Ct. 1807, 114 L.Ed.2d 307 (1991), the Supreme Court considered whether campaign contributions received "under color of official right" by a successful candidate required a quid pro quo element to constitute a Hobbs Act violation.
The Supreme Court distinguished between valid "political contributions" and extortion under the Hobbs Act. It held that a candidate running for re-election could violate the Hobbs Act by accepting certain bribes. It noted that
[p]olitical contributions are of course vulnerable if induced by the use of force, violence or fear. The receipt of such contributions is vulnerable under the Act as having been taken under color of official right, but only if the payments are made in return for an explicit promise or undertaking by the official to perform or not to perform an official act. In such situations the official asserts that his official conduct will be controlled by the terms of the promise or undertaking. This is the receipt of money by an elected official under color of official right within the meaning of the Hobbs Act.
Id. at 273, 111 S.Ct. 1807. Unlike McCormick, Louis was not a public official at the time of the events in question. He was therefore not an "official assert[ing] that his official conduct [would] be controlled by the terms." Id. (emphasis added).
7. Instead, as the Manzos point out, Congress recognizes and targets candidates as a distinct class under the criminal law. Under 18 U.S.C. § 599:
Whoever, being a candidate, directly or indirectly promises or pledges the appointment, or the use of his influence or support for the appointment of any person to any public or private position or employment, for the purpose of procuring support in his candidacy shall be fined under this title or imprisoned not more than one year, or both; and if the violation was willful, shall be fined under this title or imprisoned not more than two years, or both.
Although this statute only applies to federal candidates, not state candidates, it reveals Congress's recognition that candidates should be treated as a separate class under the law.
8. We do not use the rule of lenity to reach this conclusion because we find that the statutory text is sufficiently clear after examining the legislative history and congressional purpose of the Hobbs Act. However, we note that if we were unable to clarify the text, the rule of lenity would provide an additional basis to affirm the District Court. The rule of lenity applies to ambiguous applications of the Hobbs Act, Scheidler v. Nat'l Org. for Women, Inc., 537 U.S. 393, 409, 123 S.Ct. 1057, 154 L.Ed.2d 991 (2003), and "ensures there is fair warning of the boundaries of criminal conduct and that legislatures, not courts, define criminal liability." United States v. Edmonds, 80 F.3d 810, 821 (3d Cir.1996) (en banc) (internal citation and quotation marks omitted).
9. The Manzos seek to distinguish this case on the basis that possessing drugs is always an illegal enterprise. This distinction is not compelling because, at a minimum, the Manzos acted in violation of state campaign finance laws.
10. We also note that United States v. Tykarsky, 446 F.3d 458 (3d Cir.2006), is distinguishable. There, the defendant was charged with interstate travel to engage in illicit sexual conduct with a minor, in violation of 18 U.S.C. § 2423(b), and using an interstate facility to attempt to persuade a minor to engage in illegal sexual activity, in violation of 18 U.S.C. § 2422(b). Tykarsky argued that the indictment was insufficient because an undercover FBI agent was posing as a 14-year old girl, and therefore because no minor was actually involved in the charged offenses, it was legally impossible for him to commit the charged crime. We observed that the distinction between legal impossibility and factual impossibility was "elusive[]" and that "many jurisdictions [have] eschew[ed] the distinction between legal and factual impossibility and abolish[ed] the defense altogether." Id. at 466. However, we held that legal impossibility can sometimes be a defense to a crime, depending on legislative intent. Id. We concluded that the legislative history of § 2423(b) and § 2422(b) made clear that legal impossibility was not a defense to that particular crime, and it was sufficient that Tykarsky attempted to engage in illicit sexual conduct with a minor. Id. at 468-69. In contrast, the legislative history does not clearly extend application of the Hobbs Act to this circumstance. It is not sufficient that the Manzos attempted to gain the status of acting "under color of official right." We leave for another day whether legal impossibility could be a defense to certain Hobbs Act conspiracy charges and from whose perspective we would analyze the conspiracy, the defendant's or the victim's.
11. Several other courts have drawn upon the reasoning in Meyers, but none has extended inchoate Hobbs Act violations to a candidate who never obtained public office. In United States v. Forszt, the Seventh Circuit considered a defendant who began accepting bribes while in office but received the final payments after leaving office. 655 F.2d 101 (7th Cir. 1981). It extended the period of criminality for a conspiracy charge to encompass the period after the defendant left office because he began to sell his "public trust" while still in office. Id. at 104. However, the reach of Meyers was narrowed considerably in United States v. McClain, 934 F.2d 822 (7th Cir. 1991). The Seventh Circuit stated: "therefore we believe that, as a general matter and with caveats as suggested here, proceeding against private citizens on an `official right' theory is inappropriate under the literal and historical meaning of the Hobbs Act, irrespective of the actual `control' that citizen purports to maintain over governmental activity." Id. at 831.
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