Litigation Threats and Extortion
Threatening a groundless lawsuit unless the target pays money has often been referred to a “legalized extortion.” But maybe it’s not always legal.
The Hobbs Act makes it federal crime to obstruct, delay, or affect commerce by extortion. Extortion is defined 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.” See 18 U.S.C. § 1951(a). Does “wrongful” include a “threat of sham litigation.” Continue reading . . .
