Sekhar v. United States
The Supreme Court threw out a man's extortion conviction, ruling that pressuring a government lawyer to recommend an investment isn't the same as extorting 'property' under the federal Hobbs Act, because a recommendation can't be handed over or transferred to someone else.
The decision draws a firm line between extortion, which requires taking something of transferable value, and mere coercion, which Congress chose not to criminalize under this law - meaning threats that merely force someone to act a certain way, without gaining anything transferable, fall outside the statute.
How it got here: A jury convicted the man of attempted extortion; the Second Circuit affirmed; the Supreme Court agreed to review the conviction.
The Case in Depth
What happened
A managing partner at an investment firm wanted New York's state pension fund to invest in his fund. After the fund's in-house lawyer recommended against the investment, the partner sent anonymous emails threatening to expose the lawyer's alleged affair unless he changed his recommendation. Investigators traced the emails to the partner's computer, and he was charged with attempted extortion.
The question before the Court
Could a state pension official's forced recommendation to approve an investment count as "property" someone illegally extorted under the federal Hobbs Act?
Why it matters
Federal prosecutors can no longer use the Hobbs Act's extortion provision to charge people who threaten others into taking a particular action or making a particular decision, unless something transferable - like money or a physical asset - actually changes hands. This narrows the reach of a commonly used federal anti-corruption and anti-blackmail tool.
What changes now
The conviction is reversed outright, ending the extortion case on this theory. The Court noted, without deciding, that prosecutors might have been able to charge different conduct (such as extortion aimed at obtaining actual investment funds) under a different theory, but that was not what the jury found here. No further proceedings on this charge are contemplated.
What this does not decide
The Court did not decide whether threatening a government employee to secure actual government property or funds - rather than a mere recommendation - could still count as extortion. It also left open whether obtaining money by threatening a third party, rather than the direct victim, can qualify as extortion under the Act.
Concurrences and dissents
Concurrence — Justice Alito
Justice Alito agreed the conviction should be reversed but on a different ground: he argued that an internal government recommendation is not 'property' at all, regardless of whether it is transferable. He reasoned that recommendations about government decisions have never been treated as property, comparing them to a video-poker license that the Court had already held is not property in a government's hands. Because he found no property interest, he said it was unnecessary to reach the transferability question the majority relied on.
How the Court got there
The legal reasoning, step by step
- The Court applied the presumption that Congress incorporates the well-settled common-law meaning of legal terms it borrows, so it looked to how courts historically defined 'extortion' before the Hobbs Act was written.
- Historical extortion cases required the taking of something of value, typically money, from a victim; none treated forcing someone to give advice or make a recommendation as extortion.
- The Court read the statute's phrase 'obtaining of property' to require both that the victim give up the property and that the wrongdoer acquire it, meaning the property at issue must be transferable from one person to another.
- A recommendation to approve an investment cannot be transferred - the lawyer could not hand it over, sell it, or give it away - so it does not meet the definition of property that can be 'obtained.'
- Looking to the New York statute Congress modeled the Hobbs Act on, the Court noted Congress deliberately left out a separate 'coercion' provision that covered forcing someone to act, confirming that Congress meant extortion and coercion to be different crimes with different penalties.
- Applying its earlier ruling that mere interference with a business's rights is not extortion unless something transferable is obtained, the Court concluded that forcing the lawyer to change his recommendation was coercion, not extortion, so the conviction could not stand.
Doctrinal impact
Cases affected by this decision
Reaffirms Scheidler v. National Organization for Women, Inc. (537 U. S. 393)
The Court relied on Scheidler's rule that extortion requires acquiring something transferable, not just depriving someone of a right.
Reaffirms Cleveland v. United States (531 U. S. 12)
The Court used this ruling that a license isn't property in the state's hands to show a recommendation is even less like property.