Appeals from the United States District Court for the Northern District of Illinois, Eastern Division. No. 72 CR 414 RICHARD B. AUSTIN, Judge.
Swygert, Chief Judge, Hastings, Senior Circuit Judge, and Kiley, Circuit Judge.
Defendants Frank J. Gill and James Fahey appeal from their convictions of extortion and perjury, having been found guilty of these crimes by a jury. Gill was convicted of extortion in violation of the Hobbs Act, 18 U.S.C. § 1951, and of making a false material declaration before the grand jury in violation of 18 U.S.C. § 1623. Fahey was also convicted for the same violations. Gill received two four-year concurrent sentences and Fahey received two three-year concurrent sentences.
The evidence viewed most favorable to the Government establishes the following. Gill was a lieutenant and Fahey a sergeant with the Chicago Police Department. Stojan Kovacevic was the licensee of a combination tavern and liquor store called the Chicago-Oak Liquors. His brother, Boris, was a bartender there. Sometime in early July 1971, Chicago police officer Reddon entered the liquor store and told Kovacevic that he had sold beer to a minor. Kovacevic could not recall the sale so Officer Reddon left the store and returned shortly with the minor to whom the beer had been sold. After a conversation between Kovacevic and Reddon, Reddon left with the minor.
A short time later Lieutenant Gill and Sergeant Fahey entered the liquor store. Gill told Kovacevic that he had sold liquor to a minor. Kovacevic said he could not recall this and suggested that the officers search the minor for another identification card. Gill and Fahey then left and returned shortly and told Kovacevic that they did not find any other identification on the minor. Kovacevic said that he still did not believe it. Gill asked him what he was going to do; Kovacevic replied that he did not know. Gill then said that he would have to appear before the Liquor Commissioner. Kovacevic asked if something could be done; Gill asked what he meant. Kovacevic then offered Gill $150, but Gill countered with a demand for $500. They finally agreed on $300. Kovacevic told his brother, Boris, that he was giving the money because he feared the loss of his license as well as his business.
Constantine (Dino) Sanichas was in the tavern during the time in question and saw Fahey, with whom he was acquainted. Sanichas approached Fahey and asked what was happening. Fahey said that the owners were caught selling liquor to minors and asked Sanichas if he knew the owners. Sanichas said that he did. Fahey then asked Sanichas to talk to them and explain that "it would be $500 for the owners to be given a pass, excused." After Fahey left, Sanichas spoke with Boris and told him that the police officer wanted $500; Boris said that he couldn't pay it. Sanichas then suggested $300, to which he agreed. After Fahey had returned to the tavern, Sanichas told him, "He's willing to pay $300, to give $300 for the pass, so he won't be arrested." Fahey then told Sanichas to get the money and meet him on the corner. Fahey left. Sanichas told Boris that Fahey would accept $300, whereupon Boris produced the $300. Sanichas left the bar, met Fahey on the prearranged corner, and gave him the $300. About four to five weeks later Fahey met Sanichas and gave him $40.
Both Gill and Fahey were called before the grand jury. Gill denied asking the owner or anyone else for money when he was in the Chicago-Oak Liquors. Fahey denied receiving money from Sanichas.
Subsequently, they were jointly indicted in Count I for extortion. Gill was charged in Count II and Fahey in Count III for false declarations to the grand jury.
The first contention made by the defendants is that the commerce affected by the extortion was not of an interstate nature. They argue that there was no evidence that the beverages sold to the tavern and liquor store came from a distributor or manufacturer from outside of Illinois, despite a stipulation that the beverages were manufactured in a state other than Illinois. It is maintained that the beverages, citing Brown v. Houston, 114 U.S. 622, 29 L. Ed. 257, 5 S. Ct. 1091 (1885), were no longer in interstate commerce, having come to rest at the distributor's warehouse in Chicago before they were resold to Chicago-Oak Liquors.
The fallacy in the argument is that the Hobbs Act not only forbids extortion which interferes with interstate commerce but also extortion which affects interstate commerce. Congress' power to regulate interstate commerce is very broad. Heart of Atlanta Motel, Inc. v. United States, 379 U.S. 241, 253-58, 13 L. Ed. 2d 258, 85 S. Ct. 348 (1946); Wickard v. Filburn, 317 U.S. 111, 118-129, 87 L. Ed. 122, 63 S. Ct. 82 (1942).
The defendants make the alternative argument that the extortion of $300 from the tavern owner had, to say the least, a de minimis effect on commerce. Stated differently, they say it is unreasonable to infer that the owner's depletion of funds to the extent of $300 could have affected his ability to transact business, including the purchase of liquor from out of the state. An identical argument was made in the recent case of United States v. DeMet, 486 F.2d 816 (7th Cir., 1973). There this court, speaking through Judge Fairchild, rejected the argument:*fn1
Although King's business was primarily local, depletion of King's assets by the goods and money extorted, or the cessation of his business if he did not yield and his fears were realized, would tend to reduce the demand for and amount of beer and liquor moving into Illinois. The effect on interstate commerce would ...