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United States v. Elders

decided: February 1, 1978.

UNITED STATES OF AMERICA, PLAINTIFF-APPELLEE,
v.
THELBERT C. ELDERS, DEFENDANT-APPELLANT



Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 75-CR-650 - Frank J. McGarr, Judge.

Fairchild, Chief Judge, Swygert and Bauer, Circuit Judges. Bauer, Circuit Judge, dissenting.

Author: Swygert

SWYGERT, Circuit Judge.

In this appeal our principal concern is the nature of the effect on interstate commerce needed for jurisdiction under the Hobbs Act.

An eleven-count indictment, filed October 30, 1975, charged Thelbert C. Elders with violating the federal tax laws and the Hobbs Act. Subsequently, the grand jury returned a superseding indictment, changing the dates of the periods in the two extortion counts. Before trial the Government dismissed the first two counts and the indictment was renumbered accordingly. The charges on which the defendant went to trial can be summarized as follows:

Counts One, Three, Five, and Seven: violation of 26 U.S.C. § 7206(1) by filing a false income tax return for 1970, 1971, 1972, and 1973 respectively.

Counts Two, Four, and Six: violation of 26 U.S.C. § 7201 by evasion of income tax for 1970, 1971, and 1972 respectively.

Count Eight: violation of the Hobbs Act, 18 U.S.C. § 1951 by obtaining $11,830 from William Hall during the period from October 1969 to March 1971.

Count Nine: violation of the Hobbs Act by obtaining $16,408 from Russell Fierge and Richard Blake during the period from May 1970 to July 1973.

Following a jury trial, the defendant was convicted of filing a false income tax return (Count Seven) and of extortion (Count Nine). After the jury failed to reach a verdict on the remaining counts and the trial court declared a mistrial as to those charges, the Government dismissed Counts One through Six and Count Eight. On Count Nine, Elders was sentenced to the custody of the Attorney General for a period of eighteen months. Sentence was suspended on Count Seven, and the defendant was given three years probation to start following his prison sentence. The defendant has appealed his conviction under Count Nine, challenging the jurisdictional basis for the Hobbs Act charge. He also alleges that two trial errors require a reversal on both counts.

I

In 1967 defendant Thelbert C. Elders became Street Department Foreman for the Village of Maywood, a Chicago suburb. In August 1970 he was appointed acting Public Works Director for the village and on October 1, he was made Director. Elders held that position through June 1973.

In July 1970 Russell Fierge and Richard Blake merged their separate tree service enterprises into the Illinois Shade Tree Company (IST) to provide tree service in the western suburbs of Chicago. Blake ran the company's office while Fierge handled the public relations and supervised the work. IST began receiving contracts through Elders for tree removal work in Maywood. Fierge, having previously worked for the village, told Blake that because the village was "wired," kickbacks of ten percent of the gross billings would have to be paid to one or more of its officials. After submitting billings and receiving payments therefor, Blake gave money to Fierge who in turn delivered the cash to Elders.

In 1970 Fierge made three or four payments to Elders, the largest being $400 and the smallest $100. During part of 1971, Fierge continued to pay Elders ten percent of the payments received from Maywood; after that Blake made the payments. This arrangement continued throughout 1972 and part of 1973. In 1973 Blake gave cash to Elders on three occasions: first, in mid-May IST received a $503.50 check from Maywood for work previously done, and Blake gave Elders a ten percent kickback; second, on June 6 Blake submitted one bill for $650 and another for $2000 for clearing a vacant lot in Maywood, and upon payment gave Elders and the president of the Maywood Park District $1000 in cash; and third, on June 15 Blake paid Elders $500 for the sale to Maywood of a stump removing machine which IST owned. After admitting evidence of the June 6, 1973 transaction, the trial court ruled that the jury should not consider ...


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