Third Circuit Holds That An Extortion Conviction Does Not Depend On A Public Official Having Actual Power Over Government Action

John Bencivengo was the mayor of Hamilton Township, New Jersey.  One of his friends was an insurance broker, Marliese Ljuba, who earned substantial commissions in connection with insurance policies which were issued to the Hamilton Township School District.  When those policies came up for renewal, Stephanie Pratico who was one of the members of the school board, urged the board to place the contracts up for competitive bidding, rather than renewing the policies that had been obtained by Ljuba’s firm. Ljuba subsequently gave Bencivengo $5,000 to convince Pratico not to put the board’s insurance policies up for bid.  Bencivengo did not have any power over the school board.  He also could not vote on school board matters and did not have any official role in choosing who would be on the board.  Bencivengo was subsequently convicted of extortion in violation of the Hobbs Act. 

On appeal, Bencivengo argued that his Hobbs Act conviction was improper because he had no official authority over the actions of the school board and therefore, no actual power to replace Pratico or to otherwise ensure that the school would continue to obtain its insurance through Ljuba.  The Third Circuit in United States of America v. Bencivengo, No. 13-1836 (April 23, 2014) rejected this argument.  The Court initially noted that there was no doubt that Bencivengo had no actual power over the award of the insurance policies and that there was no evidence that Ljuba believed that he had such power.  However, a reasonable jury could find from the evidence presented at trial that Bencivengo’s position as mayor gave him influence over the school board and that Ljuba believed that he had such influence.  The Court concluded that a Hobbs Act conviction can be sustained where a public official: a) has, and agrees to wield, influence over a governmental decision in exchange for financial gain or, b) where the official’s position could permit such influence, c) and the victim of the extortion reasonably believes that the official has such influence regardless of whether the official had actual power over the decision.