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January 7, 1965

John C. KUBACKI and Abraham Minker

The opinion of the court was delivered by: LUONGO

Minker and Kubacki were found guilty by a jury on all five counts of an indictment charging (Count I) conspiracy to violate, and (Count II) the substantive violation of 18 U.S.C.A. § 1951, *fn1" and (Count III) conspiracy to violate and (Counts IV and V) substantive violations of 18 U.S.C.A. § 1952. *fn2" Their separate Motions for Acquittal and for New Trial are before me.

The convictions stemmed from events surrounding the purchase of parking meters by the City of Reading during a period when defendant Kubacki was its mayor, and defendant Minker was allegedly a behind the scenes political power. There was evidence from which the jury could find, on the first two counts, that in connection with the purchase of 500 Duncan-Miller parking meters from the Koontz Equipment Company by the City of Reading, the defendants conspired to and did obtain from a representative of Koontz the sum of $ 3,000 for awarding the contract to Koontz. There was evidence from which the jury could find, as to the remaining counts, that defendants conspired to, and did, cause others to travel in interstate commerce to distribute $ 7,500 and a valuable clock, in payment for the award of a contract for 500 parking meters to the Karpark Corporation.

 Defendants' motions for acquittal will be granted as to Counts I and II, and denied as to Counts III, IV and V. Of the many reasons advanced by the defendants in support of their motions, only two will be discussed at any length, although all have been thoroughly considered.

 Sufficiency of Evidence of Extortion under 18 U.S.C.A. § 1951

 By definition, the essential ingredient of extortion under § 1951 is 'wrongful use of actual or threatened force, violence, or fear * * *.' Although the context in which 'fear' is used in that definition suggests apprehension of physical harm to person or property, it is clear that fear of economic loss is sufficient. Bianchi v. United States, 219 F.2d 182 (8th Cir. 1955), cert. den., 349 U.S. 915, 75 S. Ct. 604, 99 L. Ed. 1249; Cape v. United States, 283 F.2d 430 (9th Cir. 1960); United States v. Palmiotti, 254 F.2d 491 (2nd Cir. 1958). The government contends that fear of economic loss was established as to Counts I and II. The evidence, viewed in the light most favorable to the government, *fn3" bearing on that contention is as follows:

 Roger Weidlich was a salesman for Koontz Equipment Company which sold parking meters manufactured by Duncan-Miller. In January 1960, Weidlich went to Reading to meet the new mayor, Kubacki, to discuss the sale of Duncan-Miller parking meters to the City. Kubacki indicated a need for approximately 2,000 meters but that they could not all be purchased at the same time. Kubacki asked Weidlich to submit a proposal for 500 meters and at the same time suggested a $ 12 to $ 15 meter 'political donation,' indicating that he was aware that money had been kicked back on meters purchased by the previous administration. Kubacki asked Weidlich to keep in touch with Wade, Chief of Police. Later Weidlich was taken by Wade to see Minker who confirmed that a political contribution would have to be made at a certain amount per meter before he would get an order for parking meters. It was Weidlich's state of mind that he 'would either have to make the donation * * * or lose the order.' Weidlich communicated the demands to Roach, an executive of the Duncan-Miller Company, and obtained from him an agreement to offer not more than $ 6 a meter. This was the price at which, ultimately, the 'deal' was consummated and a contract for 500 Duncan-Miller meters was awarded to Koontz in return for which Weidlich made a cash payment of $ 3,000 through Wade.

 In 1962, Weidlich spoke to Kubacki about an order for more parking meters to be purchased by the Reading Parking Authority. There were discussions in which Kubacki promised to exercise his influence with the Parking Authority in an effort to obtain the order for Koontz and there were discussions of the means by which payment was to be made, apparently involving a subagency contract with an alleged co-conspirator. The efforts with the Parking Authority did not culminate in the award of a contract to Koontz.

 In the indictment (Count I) the government charged that Weidlich and Roach were in fear that 'offers to sell parking meters * * * would not be considered for acceptance unless' they would consent to pay the amounts demanded. In simple terms, the government charged that these people were compelled to make a payoff for the privilege of bidding, i.e., for the privilege of competing for the award of the parking meter contract. The evidence established, instead, that Weidlich and Roach were bargaining for improper influence, for favored treatment, i.e. they were bargaining for the improper award of the contract to them without the necessity to compete.

 In all the extortion cases cited by the government, the victim was compelled to pay for the exercise or enjoyment of a right or privilege already his, under threat and out of fear that if he did not comply with the demands he would be subjected to unwarranted interference, with resulting substantial harm to his business or property rights. *fn4"

 The definition of extortion used in § 1951 is taken from New York law ( United States v. Nedley, 255 F.2d 350 (3d Cir. 1958)) and New York interpretations of that crime are helpful. Under New York law, the crimes of bribery and extortion are mutually exclusive. One who pays a bribe is equally as guilty as the one who receives it, 'which could never be the case with extortion.' People v. Dioguardi, 8 N.Y.2d 260, 273, 203 N.Y.S.2d 870, 881, 168 N.E.2d 683, 692 (1960). The court in Dioguardi noted the distinction between bribery and extortion, the essence of the one being the voluntary giving of something of value to influence the performance of official duty, the essence of the other being duress. Applying that distinction to this case, the record is devoid of evidence of duress. While Weidlich and Roach spoke of fear that they would not 'get the order,' there is nothing to raise that fear above the level of disappointment over failure to obtain a new piece of business. There is nothing in the record to show the harm, if any, either to Weidlich's economic well being, or that of the Koontz Equipment Company or of the Duncan-Miller Company from failure to obtain the order for parking meters. This lack is in sharp contrast to the evidence of fear of destruction of or substantial harm to the businesses involved in the cases cited in footnote 3, supra.

 Reasonable minds could only arrive at the conclusion that what was involved in this case was bribery. If Weidlich and Roach had any fear at all, it was fear that they would not be successful in their efforts to exercise undue influence. That is not the type of fear contemplated in § 1951. They were 'victims' only to the extent of possible dissatisfaction with the price, otherwise it is clear beyond question that they were willing participants, equally as guilty as the payees, in the scheme to obtain the award of the contract improperly.

 The evidence in this case is insufficient, as a matter of law, to sustain conviction on charges of extortion and defendants are, therefore, entitled to acquittal on Counts I and II. Their motions for acquittal on Counts I and II will be granted. In the alternative, in the event that this grant of the motions for acquittal is held to be erroneous, the convictions of both defendants on Counts I and II are set aside as being against the weight of the evidence and defendants' motions for new trial are granted on those counts.

 Ex Post Facto Application of 18 U.S.C.A. § 1952

 On § September 13, 1961, § 1952 was enacted, making it a crime to use interstate facilities in aid of unlawful activities, defined to include bribery and extortion under the laws of any state. Under the laws of ...

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