The U.S. Supreme Court on Wednesday reversed the conviction of a private equity fund executive, finding his alleged attempts to blackmail the general counsel of a New York pension fund to get him to recommend investment in the equity fund did not rise to extortion. "Whether viewed from the standpoint of the common law, the text and genesis of the statute at issue here, or the jurisprudence of this Court's prior cases, what was charged in this case was not extortion," Justice Antonin Scalia wrote in Sekhar v. United States, 12-357. The unanimous ruling reversed the U.S. Court of Appeals for the Second Circuit's decision to uphold Giridhar Sekhar's conviction for attempted extortion in violation of the Hobbs Act and interstate transmission of extortionate threats.
After Luke Bierman, then-general counsel for the New York State Comptroller's Office, recommended against investment in a fund managed by FA Technology Ventures, Sekhar, the company's managing partner, wrote anonymous emails to Bierman threatening to reveal Bierman's alleged extramarital affair if he did not change his recommendations.
Sekhar was convicted in the Northern District and the Second Circuit affirmed, saying the Hobbs Act was not confined to tangible property and Bierman "had a property right in rendering sound legal advice" (NYLJ, July, 2, 2012). The Hobbs Act defines extortion as "the obtaining of property from another, with his consent, induced by wrongful use of actual or threatened force, violence, or fear, or under color of official right." Scalia said extorted property must be "transferable, that is, capable of passing from one person to another. The alleged property here lacks that defining feature."