Extortion Distortion: Ocasio v. United States

How do you extort money from yourself?

In criminal law, we ordinarily think of perpetrator and victim as two distinct entities. It would be nonsensical, for example, to talk about me robbing myself or defrauding myself. But the same may not be true of an extortion conspiracy under the Hobbs Act. In Ocasio v. United States, the Supreme Court ruled 5-3 that a defendant may be charged with conspiring to extort money from himself.

So what makes such a contortionist extortionist possible? Although it sounds a bit bizarre, this result doesn’t represent some new watershed in white collar crime or dramatic expansion of federal criminal jurisdiction. It’s simply the logical, albeit unfortunate, outgrowth of a questionable Supreme Court decision more than two decades old.

Samuel Ocasio was one of dozens of Baltimore police officers involved in a widespread corruption scheme with the owners of a garage called Majestic Auto Repair. Police officers would refer drivers involved in car accidents to Majestic for necessary repairs, and in return the garage owners would pay the officers $150 to $300 per car. When the scheme came to light Ocasio, a number of other officers, and the owners of Majestic were charged with conspiracy to commit extortion under the Hobbs Act.

Extortion usually connotes payments made under some kind of duress; think burly guy smacking his palm with a baseball bat while he recommends that you buy the “health insurance” he is selling. But the Hobbs Act also prohibits extortion “under color of official right,” which essentially operates as bribery by another name. And because the federal bribery statute generally applies only to federal officials, prosecutors frequently turn to Hobbs Act extortion to prosecute state and local bribery schemes such as that in Ocasio.

Evans and Extortion Under Color of Official Right

The use of Hobbs Act extortion to prosecute bribery has its roots in a 1992 Supreme Court Case, Evans v. United States. Evans, a county commissioner in Georgia, was convicted of extortion under color of official right for accepting money in exchange for a favorable zoning decision. The Court rejected Evans’ claim that he had to actually induce the payment or “shake down” the payer to be guilty of extortion. It held that at common law extortion under color of official right was the “rough equivalent of what we would now describe as ‘taking a bribe.’” It was enough that a public official accepted a payment knowing that it was given in exchange for some exercise of official power.

Justice Thomas wrote a vigorous dissent in Evans, joined by Justice Scalia and Chief Justice Rehnquist. He argued that bribery and extortion had always been distinct crimes and that the majority’s decision obliterated that distinction. In particular, in a bribery case both sides – the bribe payer and the bribe recipient – are guilty parties to a corrupt deal, and both may be prosecuted. But in extortion, the person who pays the official is considered a victim, not a willing and culpable participant.

Because the payer of extortion is generally considered a victim, extortion under color of official right applies only to public officials. On its face, the Hobbs Act does not punish the payment of the extortion. What Evans resulted in, therefore, was an oddity probably unique in criminal law: a statute that prohibits bribery but only punishes the public official side of the bribe transaction.

More than twenty years later, the implications of that decision led to the dispute that landed before the Supreme Court in Ocasio. Once Evans declared extortion under color of official right to be equivalent to bribery, it was predictable that prosecutors in appropriate cases would seek a way to charge the payer’s side of those bribery transactions. Some cases have charged bribe payers with aiding and abetting their own extortion by the officials they were paying. An equally inelegant theory is that used in Ocasio: prosecutors indicted the garage owners and Officer Ocasio for conspiracy to violate the Hobbs Act, charging that the owners conspired with Ocasio to extort money from the owners themselves.

Ocasio and the Court's Opinions

Ocasio’s case before the Court challenged this conspiracy theory and hinged on the language of the Hobbs Act. The statute’s definition of extortion requires that the public official obtain property from “another.” In the context of a conspiracy, Ocasio claimed, this must mean the conspirators agree to obtain property from someone outside of that conspiracy. If the co-conspirators simply agree to exchange property among themselves, he argued, they do not obtain property of “another” within the meaning of the statute.

The majority, through Justice Alito, rejected this argument. Ocasio’s conviction, the Court said, was simply a straightforward application of textbook conspiracy law: someone can be guilty of conspiracy to commit a crime even if they didn’t -- or couldn’t -- commit all elements of the underlying crime themselves. For example, if I act as an agent for a Congressman to solicit bribes from defense contractors, I can be found guilty of conspiracy to accept bribes even though, as someone who is not a public official, I could not be charged with accepting bribes myself. If I participate in a bank robbery by providing the robbers with inside information about the bank vault and security, I’ve conspired to commit bank robbery even if I never take part in the actual robbery itself.

In Ocasio’s case, the Court held, it’s true the garage owners, as private citizens, could not commit the crime of extortion under color of official right, and if they obtained their own money it would not be property from "another."  But although the owners could not commit the crime themselves, they could conspire to help officer Ocasio commit it. Ocasio violated the statute by obtaining property from another -- which simply means someone other than Ocasio, in this case, the owners -- and the owners agreed to help him do it. Accordingly, the conspiracy charge was not inconsistent with the language of the Hobbs Act, even though the "victims" whose property was obtained were also part of the conspiracy itself.

The Court rejected concerns that this holding might make even innocent extortion victims liable for conspiring with public officials who were shaking them down. There is a distinction, the Court noted, between grudging consent given by a payer who feels he has no alternative and the proof of intent required to establish that the payer knowingly and voluntarily joined a conspiracy. Only the latter is the equivalent of bribery that would render the payer equally as culpable as the public official.

Justice Breyer wrote a brief concurrence, saying that the convoluted result made him tend to agree with Justice Thomas that Evans was probably wrongly decided. Nevertheless, he concluded, Ocasio had not asked the Court to overrule Evans, and given that case’s holding the majority opinion was correct as a matter of conspiracy law.

Justice Thomas, not surprisingly, dissented and reiterated his view that Evans was a mistake. He argued the Court should not compound the error by extending the reasoning of Evans to encompass Hobbs Act conspiracy.

Justice Sotomayor, joined by Chief Justice Roberts, wrote a separate dissent agreeing with Officer Ocasio that the most natural reading of the statutory language required the members of the conspiracy to obtain the property of someone outside the conspiracy.

The Impact of Ocasio: Not Much

I think Justice Breyer has it right; if we start with the Evans holding as a given, then Ocasio seems correct. The linguistic gymnastics required to frame a charge against the bribe payers in what is really a bribery case do highlight the shaky foundation of the Evans holding equating extortion with bribery. But as the majority noted, if you accept Evans, then basic conspiracy law dictates the result in Ocasio.

The dissenters expressed concerns about the breadth of federal criminal statutes and the scope of conspiracy law. Justice Sotomayor said she feared the Court’s ruling would invite prosecutors to round up all parties in an extortion scheme, charge everyone with conspiracy, and see “what sticks and who flips.” They also raised federalism concerns, questioning whether it was appropriate for the federal government to pursue local corruption cases that could be left to the states.

Debates about sweeping federal criminal statutes and the dangers of prosecutorial power are common these days. The pending case involving the corruption convictions of former Virginia Governor Bob McDonnell (also a Hobbs Act case) contains many of the same themes. But in Ocasio, concerns about inappropriate charges have little force. No one suggests the owners of Majestic were not blameworthy or did not deserve to be prosecuted.

As for federalism concerns, there are already many ways for federal prosecutors to charge state and local bribery. Even before the Court’s decision in Skilling v. United States, for example, it’s been clear that honest services mail and wire fraud applies to bribery and kickback schemes like that in Ocasio. Under certain conditions the Travel Act (18 U.S.C. § 1952) and the Federal Program Bribery statute (18 U.S.C. § 666) also apply to state and local corruption. It’s even likely that prosecutors could have named Majestic as a RICO enterprise and indicted everyone involved for violating RICO (18 U.S.C. § 1962) based on a pattern of state-law bribery.

In short, there are plenty of ways for federal prosecutors to pursue state and local corruption. The Hobbs Act is just one potential arrow in the prosecutor’s quiver. If Ocasio had gone the other way, I doubt there’s a single future case that would have gone unprosecuted as a result. If some members of the Court really have issues with federal prosecutors having the power to charge state and local bribery, they are several decades late to that party.

The concern about prosecutors having the power to pick and choose whom to charge with conspiracy is similarly misplaced. Prosecutors do this all the time when deciding whether a particular scheme is a true extortion scheme, where the payers are the victims, or is more like a traditional bribery scheme where the payers should be charged. That’s the essence of prosecutorial discretion and making sound charging decisions.

It’s a little disheartening to hear Justice Sotomayor, herself a former prosecutor, suggest that prosecutors might just round up everyone they see and charge them with conspiracy with no regard for their actual culpability. If that were to actually happen it would be a much bigger problem than simply the breadth of the Hobbs Act – but the presence or absence of one legal theory would not make any practical difference to such "rogue prosecutors."

In the end, therefore, Ocasio leaves the white collar crime landscape largely unchanged. Future defendants, seeing a potential invitation in Ocasio, will likely file petitions asking the Court to overturn Evans, but it’s tough to see a current majority willing to do that. Congress, of course, could step in and clear everything up by amending the Hobbs Act, but that seems even less likely given the current gridlock on Capitol Hill. And so the Hobbs Act remains as one of many powerful tools for federal prosecutors -- and a quirky one, given the untidy legacy of Evans and its peculiar version of extortion distortion.

Note: this post is adapted from an article I published in the George Washington Law Review's On the Docket.  You can find that article here.