United States v. Koziol, No. 19-50018 (9th Cir. 2021)
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The Ninth Circuit affirmed defendant's conviction for attempted extortion under the Hobbs Act for threatening to file against a well-known entertainer a suit asserting salacious and scandalous allegations if the entertainer did not settle for $1,000,000.
The panel concluded that there is no statutory, constitutional, or policy basis to support defendant's argument that threats of sham litigation are categorically excluded from criminal liability under the Hobbs Act. In this case, defendant's threats of sham litigation—in which he produced falsified evidence and lied about the existence of evidence, initially targeted another victim with the same threats, and knew he had no lawful claim against his victim—sought "wrongful" ends and thus were within the scope of Hobbs Act. Therefore, the panel rejected defendant's argument and affirmed the denial of his motion for acquittal.
The panel also concluded that, when viewed in the light most favorable to the government, the evidence was more than sufficient for the jury to conclude beyond a reasonable doubt that defendant knew his claims against the entertainer were baseless and that he had no right to demand money from the entertainer. The panel rejected defendant's instructional and evidentiary error arguments. Finally, the panel concluded that the district court did not err by applying a fourteen-level increase under U.S.S.G. 2B3.3(b)(1) based on the amount defendant demanded from the entertainer. However, the panel concluded that the district court plainly erred by failing to apply U.S.S.G. 2X1.1 for attempt offenses not otherwise covered by a specific offense guideline. Accordingly, the panel vacated the sentence and remanded for resentencing.
Court Description: Criminal Law. The panel affirmed a conviction for attempted extortion under the Hobbs Act, 18 U.S.C. § 1951(a), for threatening to file against a well-known entertainer a suit asserting salacious and scandalous allegations if the entertainer didn’t settle for $1,000,000; vacated the sentence; and remanded for resentencing. The defendant argued that his conviction must be reversed because the threat of litigation, even when “frivolous, meritless, or made in bad faith,” can never constitute “wrongful” conduct under the Hobbs Act, which imposes criminal liability for extortion on those who obtain property from another by the “wrongful use of . . . fear.” The panel concluded that there is no statutory, constitutional, or policy basis to exclude categorically threats of sham litigation from criminal liability under the Hobbs Act. The panel therefore affirmed the denial of the defendant’s motion for acquittal on this basis. The panel wrote that the circumstances of the threats must be considered to determine if the means used were “wrongful” under the Act, of if the ends were “wrongful” because the defendant sought property to which he knew he had no lawful claims. Rejecting the defendant’s sufficiency- of-the-evidence challenge, the panel held that when viewed in the light most favorable to the government, the evidence was more than sufficient for the jury to conclude beyond a UNITED STATES V. KOZIOL 3 reasonable doubt that the defendant knew his claims against the entertainer were baseless and that he had no right to demand money from the entertainer. The panel rejected the defendant’s arguments of instructional and evidentiary error. The panel held that the district court did not err by applying a fourteen-level increase under U.S.S.G. § 2B3.3(b)(1) based on the amount ($1,000,000) that the defendant demanded from the entertainer. The panel held that the district court’s erroneous failure to apply U.S.S.G. § 2X1.1—which provides guidelines for attempt offenses not otherwise covered by a specific offense guideline—was plain, and remanded for resentencing.
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