State v. Rendelman

GREENE, Judge. On November 1, 2005, a jury in the Circuit Court for Montgomery County convicted Respondent Scott L. Rendelman of one count of extortion and one count of extortion by written threat. Respondent had mailed a letter to William Elmhirst wherein he accused Mr. Elmhirst of stealing $22,000.00 from him and demanded damages plus interest compounded at nine percent. Respondent also threatened to sue Mr. Elmhirst for this amount if Mr. Elmhirst did not pay Respondent a $100,000.00 “settlement demand.” The Court of Special Appeals reversed Respondent’s convictions on the grounds of insufficiency of the evidence.

See Rendelman v. State, 175 Md.App. 422 , 927 A.2d 468 (2007). Thereafter, the State of Maryland filed a petition for writ of ⁵⁰³ certiorari, to which Respondent filed an answer and conditional cross-petition. This Court granted both petitions, State v. Rendelman, 402 Md. 37 , 935 A.2d 406 (2007), to consider the following three questions: 1. Did the Court of Special Appeals err in holding that the evidence presented by the State did not support Rendelman’s convictions of extortion and extortion by written threat? 2.

Did the trial court err in admitting into evidence redacted versions of Rendelman’s threatening letters as evidence of prior bad acts relevant to establishing Rendelman’s intent and demonstrating a common scheme or plan? 3. Did the trial court err in denying Rendelman’s request to instruct the jury on “the use of foul language?” As to the first question, we shall hold, as a matter of law, that threats of litigation, regardless of merit, do not constitute “wrongful threats of economic injury,” within the scope of Md.Code (2002), § 3-701 of the Criminal Law Article. In addition, we shall hold that threats of litigation, regardless of merit, do not constitute “unlawful extortion” within the meaning of Md.Code (2002, 2005 Repl.Vol.), § 3-706 of the Criminal Law Article. Because of our resolution of question one, we need not address questions two and three.

I. FACTUAL BACKGROUND The underlying basis for Respondent’s convictions for extortion and extortion by written threat is a letter dated December 22, 2004, addressed to Mr. Elmhirst and copied to Kevin Fay, Esquire, Mr. Elmhirst’s attorney. Before we set forth the contents of that letter, we shall briefly summarize the series of events leading to Respondent’s writing of the letter. From 1981 to 1984, Respondent was employed as the bookkeeper for Mr. Elmhirst’s company, Solarquest. Respondent was primarily responsible for paying the company’s bills and ⁵⁰⁴ reconciling the company’s accounting books.

In late 1984, Mr. Fay discovered that Respondent had embezzled $246,000.00 from Solarquest. In response, Mr. Elmhirst and Mr. Fay reported the theft to the authorities, sought criminal charges against Respondent, filed a civil action for conversion against Respondent, and immediately terminated Respondent from his position with Solarquest. Soon thereafter, Respondent wrote Mr. Elmhirst a long, conciliatory letter, admitting that he had taken the money, explaining what he had done with the funds, and promising to assign the notes and mortgages purchased with the funds to Mr. Elmhirst. Sometime thereafter, Respondent began sending Mr. Elmhirst a series of crude and accusatory letters.

On September 10,1986, Respondent was tried and convicted of 15 counts of theft relating to his embezzlement of Solar-quest funds. He was sentenced to 10 years’ incarceration, all but 18 months suspended, and three years’ supervised probation. After his conviction and until 1988, Respondent sent Mr. Elmhirst seventeen hate-filled, vulgar letters. In these letters, Respondent blamed Mr. Elmhirst for the consequences of his convictions, including his divorce from his wife and his estrangement from his children.

In addition, in some letters, Respondent claimed Mr. Elmhirst owed him $20,000.00. The letters, however, stopped in March 1988 when Respondent was released from State custody and transferred into federal custody to begin serving a federal sentence. 1 He was released from federal custody on December 21, 2001. Respondent waited until December 22, 2004, to send Mr. Elmhirst another letter. It appears he waited until his three-year period of supervised probation was terminated before resuming his letter-writing campaign against Mr. Elmhirst.

The December 22, 2004, letter is typed and bears a letterhead with Respondent’s name and an address in Sacramento, California. ⁵⁰⁵ Respondent’s letter to Mr. Elmhirst reads as follows: 2 William K. Elmhirst, you filthy [expletives], I’ve waited 20 years to write this letter. It was December 24, 1984, almost exactly 20 years ago, when you froze my bank accounts, ruined my Christmas with my family, and started the process that would put me in prison for 17 years. You’re a [expletives] piece of dog [expletive]. Thanks to you, my kids grew up without a father and my wife (or should I say my ex-wife) is a widow. [Expletives] I hate your guts.

You will NEVER be able to give me back my lost years, return me to father my 6 and 2 year old kids, or give me back my wife. My life is ruined and it’s all your doing. You made false claims against me, stole my money, and you don’t give a [expletive]. The only thing you could do is give me back my money.

That won’t make everything right again, but it’s the best you can do. It’s the only thing you can do. I was released on December 21, 2001, and I’ve been on three years parole. During that time I was not allowed to contact you, I was not allowed to travel, and I couldn’t change my residence.

But now I am off of parole. Now there is nothing stopping me from coming back there. NOTHING!! You stole about $22,000 from me.

It was actually a little more, and yes, I still have the exact amount in my records which have been sent to a third party who has kept them for me all these years. I can look it up if it becomes necessary, but for the purpose of settlement, let’s just say it was $22,000. Twenty years at 9% compounded interest makes the current amount due $123,297.04. I will settle for $100,000 even.

This is the amount I want. You give me back my money, and I swear, you will never see or hear from me again. I will take the money and leave this stinking [expletive] country and the United [expletive] States can kiss my [expletive] goodbye. This country ⁵⁰⁶ breaks up families, puts innocent people in prison without fair trials, and no one cares.

Well, [expletive] all you people. This is the wrong country to marry in and raise a family in. My son is in the army and is in Iraq and the government will probably have him killed and I never knew him beyond the age of 6 years old. [Expletive] all of you. Give me my money and I’m gone.

But if you don’t give me my money, I swear, I will come back there and I will knock on your front door. I will demand my money, and if you refuse, I will sue you, and I will sue you for the entire $128,297.04. I will make your remaining years of your life miserable. I will sue you, I will file liens on your property, I will have the sheriff seize your assets.

Don’t think the statute of limitations will help you. I remember from my legal research that the time of the statute of limitations is tolled while I am involuntarily out of the state, and I have been involuntarily out of the State of [expletive] Maryland since 1988. The statute didn’t start running again until today. The way I figure, I still have another year to file on you, but I’m not going to wait that long.

I will give you one, maybe two months, and if I don’t have my money back, I will come back. I will quit my dead end job and move out of my one room studio and I will come back. I will find you. If I have to hunt for you door to door, I will find you, and when I find you, I will sue you.

How old are you now, about 76? 77? I don’t even know if you’re still alive, but if you are, I WILL find you. If you’re dead, I will search for your heirs, and when I find them, I will demand my money from them, because they did not inherit your money. It was MINE!!!!

I will demand my money from them, and if they refuse, I will sue them. I will sue them and get my money, and then I will leave this stinking country and never come back. [Expletives]. I want my money sent to me at the above address. If I do not hear from you, I will return.

I will come to your house and look you in the eye. Don’t think this is over. Far from it. It’s just starting.

All these years, you got away with it because I was locked up. I lost cases because ⁵⁰⁷ I could not print copies of my appeal brief, I could not research State of [expletive] Maryland issues in federal prisons on the other side of the [expletive] country, and I did not have access to my records. Well, all that changes. Now, you will never again win a case by my default.

I will prosecute all my cases fully and to the end. You will not win by default. You will either give me back my money, or you will spend at least as much in legal fees trying to illegally keep it. Either way, God will not let you profit from what you did to me and my family. [Expletives].

How can you sleep at night and look yourself in the mirror in the morning? ? ? You don’t care. You ruined a man’s life for what was a puny $22,000 which made no difference in your lifestyle at all. You did it just for the fun of it, didn’t you? ?

I stole nothing from you. YOU are the thief. YOU are the menace to society. Its [sic] people like you who make society the shit that it is.

You break up families and [expletives]. You [expletive]. All you had to do was come to my sentencing and say a few words on my behalf like Kevin P. [expletive] Fay said you would do to get me to settle the civil suit with you. If you had done it, you would never have heard from me again.

But you didn’t, and you cost me 20 years of my life. Now, it’s not over. Now I want my money back, and if you don’t give it to me, I will make you wish you had come to my sentencing like you promised. I will sue you, I will file liens on your house and Solarquest property, and I will have the sheriff seize your assets.

You will pay. You will pay $100,000 or your remaining years will be spent paying legal fees and going to court when I sue you for $123,297.04. By the way, Merry [expletive] Christmas you [expletives]. I’m sending a copy of this letter to Kevin Fay.

I may sue him too for being a [expletive] piece of [expletive]. Mr. Elmhirst never received this or subsequent letters as he ⁵⁰⁸ had moved to England prior to their transmittal. 3 Mr. Fay, however, received the copies directed to him and brought them to the attention of the law enforcement authorities. On June 17, 2005, Respondent was indicted on four counts of extortion and four counts of extortion by written threat. Four of the eight counts (two counts each of extortion and extortion by written threat) concerned the letter Respondent sent to Mr. Elmhirst (and copied to Mr. Fay) on or about December 22, 2004.

The other four counts concerned two letters from Respondent and received by Mr. Fay, dated February 8, 2005, and March 14, 2005. A jury trial was held on October 31 and November 1, 2005. The State called Mr. Fay and his receptionist as witnesses. Respondent offered no evidence.

After deliberation, the jury found Respondent guilty of one count of extortion and one count of extortion by written threat relating to the letter, dated December 22, 2004, sent to Mr. Elmhirst. The jury acquitted Respondent of the six remaining counts. Respondent filed a timely appeal to the Court of Special Appeals. On July 6, 2007, the intermediate appellate court reversed the convictions, holding that there was insufficient evidence to support the two convictions.

Rendelman, 175 Md.App. at 449 , 927 A.2d at 484 . Specifically, the court determined that to be convicted of extortion, the defendant must both intend to achieve a wrongful goal and attempt to do so by a wrongful means. Id. at 438 , 927 A.2d at 477 . The court noted that the evidence the State presented at trial was sufficient to prove that Respondent’s goal, to obtain money he was not entitled to, was wrongful.

Id. at 443 , 927 A.2d at 480 . The intermediate appellate court, however, concluded that the evidence presented was insufficient to prove that Respondent attempted to accomplish this goal by wrongful means. Id. at 444, 449 , 927 A.2d at 480, 484 . The court held that threats of litigation, ⁵⁰⁹ even if made in bad faith, are not a wrongful means under Maryland statutory language.

Id. at 448 , 927 A.2d at 483 . The court explained: [A] threat to bring civil litigation does not have intrinsic extortionate value. The threat is to place the extortionist’s claim against the victim in the hands of a neutral third party, the civil justice system, to decide. The threat is not such as to instill fear because, if it is carried out, the extortionist no longer has the power to affect its result.

Without the capacity to instill fear, the threat, in and of itself, does not have the force to leverage payment of value from the victim merely to avoid a consequence. Rendelman, 175 Md.App. at 446 , 927 A.2d at 481-82 .

II

STATUTORY PROVISIONS We are called upon to determine what the Maryland General Assembly intended when it enacted two statutes. The statutory provisions with which we are concerned are §§ 3— 701 4 and 3-706 5 of the Maryland Criminal Law Article. 6 Section 3-701, entitled “Extortion generally,” reads in its entirety: 7 ⁵¹⁰ (a) Scope of section.—This section does not apply to legitimate efforts by employees or their representatives to obtain certain wages, hours, or working conditions. (b) Obtaining, attempting or conspiring to obtain property prohibited.—A person may not obtain or attempt to obtain money, property, or anything of value from another person with the person’s consent, if the consent is induced by wrongful use of actual or threatened force or violence, or by wrongful threat of economic injury. (c) Penalty—Value of property $500 or more.—If the value of the property is $500 or more, a person who violates this section is guilty of the felony of extortion and on conviction is subject to imprisonment not exceeding 10 years or a fine not exceeding $5,000 or both.

(d) Penalty—Value of property less than $500. If the value of the property is less than $500, a person who violates this section is guilty of the misdemeanor of extortion and on conviction is subject to imprisonment not exceeding 18 months or a fine not exceeding $500 or both. (e) Limitation.—A prosecution for a felony under this section shall be instituted within 5 years after the crime was committed. Section 3-706, entitled “Extortion by written threat,” provides: (a) Scope of Section.—(1) This section applies to any writing, whether or not the writing is signed, or if the writing is signed, whether or not it is signed with a fictitious name or any other mark or designation.

(2) This section does not apply to a good faith reasonable notice of dishonor and warning of criminal prosecution ⁵¹¹ under Title 8, Subtitle 1 of this article given by a holder of an instrument to the maker of the instrument. (b) Prohibited.—A person, with the intent to unlawfully extort money, property, or anything of value from another, may not knowingly send or deliver, or make for the purpose of being sent or delivered and part with the possession of, a writing threatening to: (1) accuse any person of a crime or of anything that, if true, would bring the person into contempt or disrepute; or (2) (i) cause physical injury to a person; (ii) inflict emotional distress on a person; (iii) cause economic damage to a person; or (iv) cause damage to the property of a person. (c) Penalty.—A person who violates this section is guilty of a felony and on conviction is subject to imprisonment not exceeding 10 years or a fine not exceeding $10,000, or both.

III

PARTIES’ CONTENTIONS The State The State contends that the Court of Special Appeals erred when it held that the evidence presented at trial against Respondent did not support his convictions for extortion. The State maintains that the Court of Special Appeals should not have resolved the case as a matter of law and should not have “substituted its judgment for that of a properly-instructed jury.” The State argues further that the intermediate appellate court erroneously adopted an “inflexible per se rule,” and “purports to base its decision on settled authority [when] there is by no means a consensus” among other jurisdictions as to what constitutes extortion. In addition, the State contends that while there are no Maryland appellate cases which have interpreted the phrase “wrongful threat of economic injury,” found in § 3-701, the ⁵¹² clear intent of the Maryland legislature “was that the extortion laws cover the widest range of conduct, including, as implicated in the present case, threats of economic harm.” The State asserts that “there is nothing in the history or text of Maryland’s extortion statutes that suggests that threats of litigation, where the threats are unjustified or wrongful, may not be considered extortionate.” According to the State, the statutes carve out only two types of threats that will not support a charge of extortion—(1) demands to “obtain certain wage, hours, or working conditions,” see § 3-701(a); and, (2) demands relating to bad checks, see § 3-706(a). Further, the State argues that while the intermediate appellate court purported to rely on “a clear majority of the federal courts” in its holding, there is actually a split among the federal circuits as to whether bad faith threats of litigation amount to wrongful threats of economic harm.

Specifically, the State cites Sosa v. DIRECTV, Inc., 437 F.3d 923, 939-40 (9th Cir.2006), and United States v. Sturm, 870 F.2d 769, 774 (1st Cir.1989), as examples. The State also cites a flurry of cases to argue that the issue of wrongfulness of a threat should be left to the trier of fact—United States v. Kattar, 840 F.2d 118, 123 (1st Cir.1988); Sturm, 870 F.2d at 774 ; United States v. Hyde, 448 F.2d 815, 833 (5th Cir.1971); State v. Ashley, 108 N.M. 343 , 772 P.2d 377, 381 (1989); and, State v. Roth, 289 N.J.Super. 152 , 673 A.2d 285, 290 (App.Div.1996). The State explains: “the per se rule adopted by the Court of Special Appeals is unwarranted and creates a loophole in the law of extortion by permitting potential blackmailers to evade prosecution simply by couching their threats in the form of a threatened lawsuit.” Finally, the State contends that the Court of Special Appeals erred in treating Respondent’s letter dated December 22, 2004, to Mr. Elmhirst as a usual and customary demand letter. According to the State, Respondent “had no colorable cause of action for damages against [Mr.] Elmhirst....

The evidence before the jury showed Respondent sought to exact revenge against Mr. Elmhirst and Mr. Fay, whom Rendelman believes unfairly accused him of embezzlement years before.” ⁵¹³ In other words, the State asks this Court to respect the jury’s decision to convict Respondent for extortion: “In this case, the jury reasonably concluded that Respondent’s vulgar, obnoxious, threats to sue, file liens, seize assets, and to make the remaining years of the victims’ lives miserable, where the evidence showed that Respondent had no legitimate claim to anything, amounted to a wrongful threat of economic injury.” Respondent Respondent argues that the evidence presented at trial does not support his convictions for extortion by threat of economic harm. Specifically, Respondent contends that his conduct was not prohibited by the statutes under which he was convicted. He states: “The statutory language and legislative history require that threats be unlawful, or at a minimum wrongful, in order to be chargeable as extortion. Maryland cases and cases from other jurisdictions are united in holding that threats to take legal action, no matter how frivolous or unwarranted, are not wrongful or unlawful and thus cannot support an extortion conviction premised on a threat to cause economic harm.” Respondent contends that “neither the [statutory] text nor the legislative history of Maryland extortion statutes support a conviction based on a threat to take legal action.” Rather, Respondent asserts that the statutes criminalize “wrongful” threats made with “unlawful” intent.

According to Respondent, “a threat to resort to legal process is the antithesis of the wrongful and unlawful conduct proscribed by Maryland’s extortion laws” and he points out that the intermediate appellate court once generally noted that under Maryland law, “threats to institute civil proceedings are not wrongful.” See Bell v. Bell, 38 Md.App. 10, 17, 379 A.2d 419, 423 (1977).

IV

To assess whether any rational trier of fact could have found the essential elements of the crimes of extortion and extortion by written threat beyond a reasonable doubt, we view the evidence in the light most favorable to the prosecu ⁵¹⁴ tion. See Harrison v. State, 382 Md. 477, 487-88 , 855 A.2d 1220, 1226 (2004). At trial, the State essentially presented the following evidence: In late 1984, Mr. Elmhirst and Mr. Fay learned that Respondent had embezzled $246,000.00 from Solarquest, a company owned by Mr. Elmhirst, during the three years Respondent was employed by the company. On December 20, 1984, Respondent wrote Mr. Elmhirst a lengthy letter wherein he admitted taking the money and attached, as reimbursement, a check for $93,496.50.

He also promised to assign to Mr. Elmhirst three notes he acquired using the embezzled money. Mr. Elmhirst immediately terminated Respondent from employment with Solarquest and filed criminal charges and a civil action for conversion against Respondent. On September 10, 1986, Respondent was convicted in the Circuit Court for Montgomery County of 15 counts of felony theft relating to his embezzlement of funds from Solarquest. Thereafter, at various times from 1985 through 2004, Respondent sent letters to Mr. Elmhirst and Mr. Fay explaining his hatred for the two men for their perceived role in his criminal convictions and subsequent incarceration.

On or about December 22, 2004, Respondent sent Mr. Elmhirst a letter, which the State used as its basis for two of the eight criminal charges against Respondent. It appears Respondent waited until his probation terminated before writing to Mr. Elmhirst, apparently to avoid violating the terms of his probation. In the letter, Respondent blamed Mr. Elmhirst for the consequences that followed his criminal convictions. He also accused Mr. Elmhirst of stealing “about $22,000” from him.

The letter, however, does not specify when or how Mr. Elmhirst stole the money from Respondent. Respondent claimed that, with nine percent compounded interest upon the $22,000.00, Mr. Elmhirst owed him $123,297.04, as of the date of the letter. Respondent, however, asserted that he would “settle for $100,000 even.” Respondent then delineated the consequences to Mr. Elmhirst if Mr. Elmhirst chose not to meet the settlement demand: “I will sue you, I will file liens on your house and Solarquest property, and I will have the sheriff seize your assets. You will pay.

You will pay $100,000 ⁵¹⁵