Re v. United States, No. 11-3714 (7th Cir. 2013)

Annotate this Case
Justia Opinion Summary

Re and Leach owned warehouses in Englewood, Florida. After leasing space in Leach’s warehouse, Daughtry told his agent that he did so because Leach stated that a sewer line essential to Re’s warehouse crossed Leach’s property without permission and lacked permits. The agent shared the information who Re, who hired assailants to beat Leach and threaten worse unless he broke the lease. Re was convicted under the Hobbs Act, 18 U.S.C. 1951, for using extortion to injure Leach’s business in interstate commerce. The Seventh Circuit affirmed. In a petition under 28 U.S.C. 2255, Re claimed that his lawyers rendered ineffective assistance: trial counsel by stealing from Re and appellate counsel by omitting an argument certain to prevail. The district court denied the petition. The Seventh Circuit affirmed, rejecting an argument that threatening someone without “obtaining” money, or value, in return, does not meet the Hobbs Act definition. A jury could find that Re’s goal in having Leach beaten was to obtain Daughtry as a tenant to get rental payments. A post-trial crime by a lawyer against his client does not spoil the trial as a matter of law; prejudice must be shown. Re could not establish prejudice. The lawyer who embezzled his funds played only a peripheral role in the trial.

Download PDF
In the United States Court of Appeals For the Seventh Circuit ____________________   No.  11-­ 3714   RANDALL  RE,   Petitioner-­ Appellant,   v.   UNITED  STATES  OF  AMERICA,   Respondent-­ Appellee.   ____________________   Appeal  from  the  United  States  District  Court  for  the   Northern  District  of  Illinois,  Eastern  Division.   No.  07  C  1264    Charles  P.  Kocoras,  Judge.   ____________________   ARGUED  SEPTEMBER  12,  2013    DECIDED  DECEMBER  4,  2013   ____________________   Before  POSNER,  EASTERBROOK,  and  SYKES,  Circuit  Judges.   EASTERBROOK,   Circuit   Judge.   Randall   Re   and   Gregory   Leach   owned   adjacent   warehouses   in   Englewood,   Florida.   After   leasing   space   in   Leach s   warehouse,   Jimmy   Daughtry   told  his  real  estate  agent  that  he  did  so  because  Leach  repre-­ sented  that  a  sewer  line  essential  to  Re s  warehouse  crossed   Leach s   property   without   permission   and   lacked   permits.   The   agent   passed   this   information   to   Re,   who   might   have   sent  Leach  a  letter  of  inquiry  or  filed  a  lawsuit  against  him.   No.  11-­ 3714   2   Instead  Re  hired  some  goons  to  beat  Leach  and  threaten  him   with   worse   unless   he   broke   the   lease.   Re   wanted   Daughtry   as  his  own  tenant.  These  events  led  to  a  conviction  under  the   Hobbs   Act,   18   U.S.C.   §1951,   for   using   extortion   to   injure   Leach s  business,  which  was  part  of  interstate  commerce.  We   affirmed  the  conviction,  401  F.3d  828  (7th  Cir.  2005),  and,  af-­ ter  a  remand,  the  sentence,  419  F.3d  582  (7th  Cir.  2005).   In   this   collateral   attack   under   28   U.S.C.   §2255,   Re   con-­ tends   that   his   trial   and   appellate   lawyers   rendered   ineffec-­ tive   assistance trial   counsel   because   the   lawyer   stole   from   Re   and   appellate   counsel   because   he   omitted   what   Re   de-­ picts  as  an  argument  certain  to  prevail.  The  district  court  de-­ nied  the  petition  with  respect  to  these  issues,  2011  U.S.  Dist.   LEXIS  55334  (N.D.  Ill.  May  24,  2011),  and  denied  a  motion  for   reconsideration,   2011   U.S.   Dist.   LEXIS   111437   (N.D.   Ill.   Sept.   29,  2011).  Re  raises  the  same  arguments  on  appeal.  We  start   with  the  challenge  to  appellate  counsel s  performance.   Re  submits  that  Scheidler  v.  National  Organization  for  Wom-­ en,   Inc.,   537   U.S.   393   (2003),   provided   the   basis   for   a   can t-­ miss   argument an   argument   that   his   lawyer   nonetheless   missed.  The  Hobbs  Act  defines  extortion  as   the  obtaining  of   property  from  another,  with  his  consent,  induced  by  wrong-­ ful   use   of   actual   or   threatened   force,   violence,   or   fear .   18   U.S.C.  §1951(b)(2).  Scheidler  holds  that  the  word   obtaining   must   be   taken   seriously,   and   that   threatening   someone   without   obtaining   money,   or   money s   worth,   in   return,   does  not  meet  the  statutory  definition.  Getting  someone  else   to  abandon  a  property  right  differs  from   obtaining  proper-­ ty,  Scheidler  concludes.  Re  observes  that  the  indictment  does   not  allege,  and  the  jury  did  not  find,  that  Leach  handed  over   any  money  or  other  property  after  being  beaten  and  threat-­ 3   No.  11-­ 3714   ened.   It   follows,   Re   maintains,   that   he   did   not   violate   the   Hobbs  Act  and  that  counsel  necessarily  fell  short  of  his  obli-­ gations  by  omitting  this  argument  on  appeal.   The  attack  on  counsel s  performance  is  window  dressing.   If   Re   is   right   about   the   meaning   of   the   Hobbs   Act,   then   he   has   been   convicted   of   an   act   that   the   law   does   not   make   criminal  and  is  entitled  to  relief  under  §2255  even  if  counsel   did  everything  possible  to  protect  his  interests.  See  Bousley  v.   United   States,   523   U.S.   614   (1998);   Davis   v.   United   States,   417   U.S.  333  (1974).  But  Re  is  not  right  about  the  meaning  of  the   Hobbs   Act at   least,   is   not   right   to   attribute   to   either   Scheidler   or   Sekhar   v.   United   States,   133   S.   Ct.   2720   (2013),   a   holding  that   obtaining  property  requires  getting  it  directly   from  the  person  threatened.  Section  1951(b)(2)  speaks  of  ob-­ taining   property   from   another ;   it   does   not   say   that   the   another  must  be  the  threat s  recipient.   Re   had   Leach   beaten   and   threatened.   A   jury   could   find   that   Re s   goal   was   to   obtain   Daughtry   as   a   tenant.   Tenancy   yields   rental   payments,   a   form   of   property.   Re   hoped   that   greater   rental   income   would   enable   him   to   sell   the   ware-­ house  for  more,  effectively  capitalizing  the  value  of  the  ten-­ ancy.  Scheidler  did  not  address  such  a  situation;  it  dealt  with   a   prosecution   in   which   the   proof   showed   that   the   victim   abandoned   property   but   the   perpetrator   did   not   get   any-­ thing.   Re   set   out   to   obtain   something   of   financial   value.   In   Sekhar,  133  S.  Ct.  at  2725  n.2,  the  Supreme  Court  reserved  the   question   whether   threats   to   a   business   competitor   that   pro-­ duce   a   transfer   of   a   customer s   revenue   violate   the   Hobbs   Act.  This  shows  that  the  Justices  do  not  view  Scheidler  (or  for   that  matter  Sekhar)  as  having  settled  the  issue  in  Re s  favor.   And   Re   does   not   contend   that   any   circuit   has   resolved   the   No.  11-­ 3714   4   question   in   his   favor.   Sekhar   noted   that   United   States   v.   Ze-­ mek,  634  F.2d  1159,  1173  (9th  Cir.  1980),  held  that  the  Hobbs   Act   covers   using   threats   or   violence   to   divert   a   customer s   business   from   one   competitor   to   another;   Re   does   not   cite   contrary   appellate   authority.   This   knocks   out   a   claim   of   ac-­ tual   innocence,   whether   presented   through   the   lens   of   inef-­ fective  assistance  or  directly  under  Bousley  and  Davis.   Re s  reply  brief  maintains  that  the  sort  of  theory  now  ad-­ vanced  by  the  prosecutor,  applied  in  Zemek,  and  reserved  in   note  2  of  Sekhar,  was  not  adequately  laid  out  in  the  jury  in-­ structions,   and   that   he   is   therefore   entitled   to   a   new   trial.   That s   a   contention   different   from   the   one   made   in   the   dis-­ trict   court   and   the   opening   brief,   however.   If,   as   Re   argued   earlier,  he  is  innocent  of  any  crime,  then  he  is  entitled  to  be   acquitted.  A  request  for  a  new  trial  comes  too  late and  this   recasting   of   the   theory   may   explain   why   counsel   omitted   it   on   direct   appeal.   It   had   not   been   presented   to   the   district   court   at   trial,   which   preceded   Scheidler,   making   it   hard   to   frame   an   appellate   issue;   and   a   theory   that   not   only   can t   succeed   without   establishing   plain   error,   but   also   leads   at   best  to  a  remand  for  another  trial  at  which  conviction  is  like-­ ly,   is   not   one   that   every   competent   appellate   lawyer   will   pursue.   Raising   (relatively)   weak   issues   leaves   less   space   in   the  brief  for  stronger  ones.   Now   for   the   attack   on   trial   counsel.   Re   hired   Richard   Beuke  to  represent  him  at  trial  and  suggested  that  Beuke  use   Terry   O Donnell   (his   lawyer   in   pending   divorce   proceed-­ ings)  as  an  assistant.  Three  weeks  after  the  jury  returned  its   verdict,  Re  sold  a  warehouse  located  in  Woodridge,  Illinois.   The   proceeds   were   put   in   escrow,   from   which   O Donnell   embezzled  them.  O Donnell  claimed  that  Re  owed  him  some   5   No.  11-­ 3714   of   this   money,   but   we   assume   for   current   purposes   that   O Donnell  committed  theft.  After  the  invasion  of  the  escrow   was  detected,  O Donnell  promised  to  reimburse  Re  or  his  ex-­ wife   but   committed   suicide   before   doing   so.   Re   contends   that   O Donnell s   crime   shows   a   conflict   of   interest,   which   requires  a  new  trial  without  the  need  to  show  prejudice.  He   relies   on   Cuyler   v.   Sullivan,   446   U.S.   335   (1980),   and   United   States  v.  Cronic,  466  U.S.  648  (1984).   Re   does   not   contend   that   Beuke   acted   under   a   conflict.   He   maintains   that   O Donnell   wanted   him   convicted   so   that   he   could   steal   from   the   matrimonial   estate,   though   he   does   not  identify  any  concrete  step  O Donnell  took  to  hamper  the   defense  of  the  Hobbs  Act  charge.  The  district  judge  held  that   a  post-­ trial  crime  by  a  lawyer  against  his  client  does  not  spoil   the   trial   as   a   matter   of   law;   prejudice   must   be   shown.   Re   could   not   establish   prejudice,   the   judge   thought,   because   O Donnell   played   only   a   peripheral   role   in   the   trial.   Beuke   did   most   of   the   work   and   supervised   O Donnell s   few   con-­ tributions.   O Donnell   was   not   a   member   of   the   Trial   Bar   of   the   Northern   District   of   Illinois   and   thus   could   litigate   in   a   criminal   trial   only   under   the   direct   supervision   of   a   more   experienced  lawyer,  such  as  Beuke.   According  to  Re,  the  judge  should  not  have  reached  these   conclusions   without   an   evidentiary   hearing.   Yet   the   judge   presiding  in  the  §2255  proceeding  had  conducted  the  crimi-­ nal   trial.   He   saw   exactly   what   roles   Beuke   and   O Donnell   had  played.  Re  relies  on  the  principle  of  Cronic  that  it  is  un-­ necessary   to   show   prejudice   when   a   lawyer   effectively   abandons   his   client,   but   he   does   not   contend   that   Beuke   abandoned   him.   He   had   un-­ conflicted   legal   assistance   throughout.   Anyway,   the   Supreme   Court   has   never   held   No.  11-­ 3714   6   that   there   can   be   a   conflict   of   interest,   or   any   other   kind   of   ineffective   assistance,   by   retrospect.   The   Justices   have   been   unwilling  to  extend  Cronic  beyond  abandonment  or  a  situa-­ tion   in   which   the   defendant   effectively   was   unrepresented,   see,   e.g.,   Wright   v.   Van   Patten,   552   U.S.   120   (2008);   Bell   v.   Cone,  535  U.S.  685  (2002),  and  Re  had  not  demonstrated  that   his  defense  team  was  missing  in  action.  No  other  circuit  has   held  that  a  post-­ trial  crime  by  a  lawyer  against  his  client  au-­ tomatically   and   retroactively   spoils   the   trial.   Establishing   prejudice   remains   essential and   the   district   judge   did   not   err  in  concluding  that  Re  has  not  established  prejudice.   AFFIRMED