Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

UNITED STATES v. GONZALES

October 16, 1985

UNITED STATES OF AMERICA
v.
ALPHONSE C. GONZALES, DEFENDANT.



The opinion of the court was delivered by: Moran, District Judge.

MEMORANDUM AND ORDER

This case will, apparently, proceed to trial on the fifth indictment. While the parties dispute, as a side matter, why this is so, the fact is that the passage of time has largely destroyed some defense contentions and vindicated others. The government response to the latter has been to recast charges in a superceding indictment. We are thus faced with issues relating to the present indictment in light of the present state of the law. We are also faced with a number of motions and issues raised with respect to the first indictment and still to be determined, and their resolution requires a selective use of memoranda previously filed. There are, as well, new motions and new contentions. The process has generated massive and meticulously researched memoranda, and the last briefs have yet to be filed. Time constraints do not permit this court to deal with the many issues in anything like the detail in the various submissions. Given those constraints, the following is a resolution of all pending matters, as best as we can determine.

1. Motions to dismiss count one.

Because of the changes in count one in the fifth indictment, ruling on one aspect of the motion to dismiss is reserved until further briefing is completed.

  The other dispute about count one is whether a private
citizen's taking of money for the ostensible purpose of using it
to influence the conduct of a public official is bribery within
the ambit of RICO. The government suggests that a law license
makes defendant a public official, but that goes too far. The
defendant contends that receipt of money by a private citizen
ostensibly for the purpose of paying off public officials may be
bribery under Illinois law but is really theft by deception and
not generic bribery for RICO purposes, absent proof that the
citizen did pay, or intended to pay, the monies to a public
official. This court disagrees. The state label for proscribed
conduct, as defendant contends, is not itself the answer. As
Judge Shadur pointed out in United States v. Kaye, 586 F. Supp. 1395
 (N.D.Ill. 1984), however, the generic meaning of bribery
focuses on the intent of the briber to influence official action.
A scheme to obtain intended bribes, even if there is no intention
to carry through, is an assault on the integrity of official
action different in kind from simple theft by deception and, this
court believes, within the ambit of bribery as a predicate
offense within RICO. That distinction is not lessened because the
ostensible intermediary is a private citizen rather than a public
official.

2. Motion to dismiss count two.

In count two the government charges a section 1962(a) violation of RICO, alleging that the defendant used racketeering income in his sole proprietorship. Defendant attacks that count on the same basis as count one, including the contention that the predicate acts are not bribery for RICO purposes, and with like effect. In addition, defendant argues that section 1962(a), like section 1962(c), requires that the defendant cannot be the enterprise. Assuming that count two does charge that the defendant is the enterprise, the argument founders nonetheless. The Court of Appeals in Haroco, Inc. v. American National Bank & Trust Co. of Chicago, 747 F.2d 384 (7th Cir. 1984), aff'd on other grounds, ___ U.S. ___, 105 S.Ct. 3291, 87 L.Ed.2d 437 (1985), concluded that section 1962(a) did not require that the liable person and the enterprise be separate. Although defendant is technically correct in describing that conclusion as dictum, that conclusion was a considered judgment relied upon to support the court's interpretation of section 1962(c). More recently, United States v. DiCaro, 772 F.2d 1314 (7th Cir.), adhered to that reasoning. Dicta those conclusions may be, but they clearly are the settled law in this circuit.

Defendant also contends that count two is fatally deficient because the money in three of the four payments came from the F.B.I. and therefore were not "dirty" funds obtained from a pattern of racketeering activity. Count two charges, among other things, that the F.B.I. agent paid money to defendant to be used to pay bribes. The "other things" charged is receipt of money for bribes from a person not an agent and an actual bribe payment to a public official. Only the former is germane to the count two charge, and one receipt is not a pattern. This court believes, however, that F.B.I. payments can constitute income derived from a pattern of racketeering activity so long as the payor had the intention or understanding specified in Ill.Rev.Stat. ch. 38, ¶¶ 33-1(d) or (e). The assault on the integrity of official action is a harm flowing from the receipt or solicitation, not very dissimilar from extortion under the Hobbs Act from an agent participating in a sting operation. See United States v. Blackwood, 768 F.2d 131 (7th Cir. 1985). The charge is that the payments were made as "dirty" money and received as such. That is sufficient underpinning for the pattern of racketeering claim, and count two goes on to allege that the monies were used in the enterprise. And that is enough. The motion to dismiss count two is denied.

3. Motion to dismiss counts three through five.

Count three charges Hobbs Act violations, alleging that defendant "knowingly did attempt to affect commerce" by seeking money from an F.B.I. agent for payoffs to public officials to influence the disposition of an armed robbery case against Donna Kuster, "which money was sought from or on behalf of" the agent and Kuster, with their consent, "said consent being induced under color of official right and by the wrongful use of fear. . . ." Count four makes a similar charge respecting a probation revocation proceeding against Kuster. Count five also charges Hobbs Act extortion, that count charging both a knowing attempt to affect, and an effect on, interstate commerce, and relating to obtaining a driver's license in a false name, the consent of the agent "being induced under color of official right." Defendant moves to dismiss those counts on the ground that the alleged conduct had no objective "realistic probability" of an effect upon interstate commerce and that, accordingly, there is no jurisdictional basis for a federal offense.

Defendant's response to those theories is voluminous and lends considerable support to the notion that judicial consideration of interstate commerce in federal sting operations borders on the metaphysical, but, invariably, ultimately sustains federal jurisdiction on one ground or another. The most direct basis for that result is that a fiction becomes reality for the purpose of analysis. A fictitious law firm is treated as a real economic entity whose assets are depleted by extortionate payments. United States v. Murphy, 768 F.2d 1518 (7th Cir. 1985). A fictitious narcotics organization is benefitted by such payments. See United States v. Ambrose, 740 F.2d 505 (7th Cir. 1984), cert. denied, ___ U.S. ___, 105 S.Ct. 3479, 87 L.Ed.2d 614 (1985). There is, in those situations, an objectively realistic probability of an effect upon interstate commerce if the victim (here an individual acting for an enterprise) were what he purported to be. The nexus with interstate commerce is not the extortioner's subjective belief but the victim's purported identity, and it matters not whether that identity was fleshed out by specific expenditures of goods and services directly or indirectly in interstate commerce, although there were here, or so the government represents, some such purchases.

This court does not mean, by avoiding an extended analysis of the various cases cited by the parties and the intellectual convolutions they suggest, that the path to a conclusion in a case such as this is straight, wide and clear. Rather, it is persuaded that the path leads, ultimately, to the conclusion reached here (and which this court followed in the United States v. Blackwood jury instructions) that the reasonably probable impact upon the purported victim is controlling. That does not, by any means, federalize all extortion law. It does recognize that federal law enforcement can, through sting operations, bring extortion within the ambit of the Hobbs Act. The federal involvement in a real sense creates the federal concern by creating a purported victim who, if he existed and was extorted, would implicate interstate commerce concerns (and, conversely, the federal law enforcement concern as a practical matter leads to the federal involvement) and, thereby, in those circumstances, gives a reach to federal law it otherwise might not have. That power is, however, not denied by the defendant. He recognizes that a sting operation with the proper window dressing, e.g., the dummy law firm with an office and stationery, is sufficient. This court does not believe that the adequacy of the window dressing is the ultimate basis for the various decisions upholding federal jurisdiction.

Those counts stumble, however, on the concept of official right. Defendant contends that, in the absence of an official position, he cannot be properly charged with a Hobbs Act extortion "under color of official right." The government argues that the reach of the statute extends to the perceived insider who, the victim reasonably believes, can influence official action. Few cases directly deal with the issue, although several arguably lend support to one view or the other, e.g., United States v. Emalfarb, 484 F.2d 787 (7th Cir.), cert. denied, 414 U.S. 1064, 94 S.Ct. 571, 38 L.Ed.2d 469 (1973). Two cases which do directly deal with the issue are United States v. Phillips, 586 F. Supp. 1118 (N.D.Ill. 1984) and United States v. Freedman, 562 F. Supp. 1378 (N.D.Ill. 1983), and ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.