# Rutkin v. United States, 343 U.S. 130 (1952)

Canonical: https://mobfiles.org/items/courtlistener-rutkin-v-us-343-us-130/

The Supreme Court holds that money obtained by extortion is taxable income. Its statement of facts recites that on May 11, 1943 Joseph Reinfeld paid $358,000 to Zwillman and Stacher "representing their conceded interest in the proceeds of Browne Vintners stock."

Supreme Court of the United States, No. 195, argued December 3, 1951 and decided March 24, 1952 (the opinion header's dates). Justice Burton wrote for the Court; Justice Black wrote a dissent. "The principal issue before us is whether money obtained by extortion is income taxable to the extortioner," and the Court held that it is. Rutkin "was found guilty by a jury in the United States District Court for the District of New Jersey, fined $10,000 and sentenced to four years in prison"; the Court affirmed.

The facts as the Court states them: Joseph Reinfeld's "first association with petitioner was in 1929 with several others in a bootlegging operation known as the 'High seas venture,'" selling whiskey at sea beyond the twelve-mile limit; Reinfeld testified that Rutkin was taken in because his associates "were afraid that otherwise they would get 'interference and trouble'" from him. After the others organized Browne Vintners Co., Rutkin claimed an interest in it. "On May 11, Reinfeld handed to petitioner $250,000 in cash at the same time that Reinfeld paid $358,000 to Zwillman and Stacher representing their conceded interest in the proceeds of Browne Vintners stock. Petitioner, with Zwillman and Stacher, thereupon signed a 'general release.'" The jury's verdict, the Court said, reflected its conclusion that the $250,000 was obtained by extortion.

The opinion gives only the surnames Zwillman and Stacher. The Treasury agent Edwin A. Baldwin's 1951 testimony names "Abner Zwillman" and "Joe Stacher" in the same group and describes Rutkin's suit against Reinfeld ([testimony](/items/kefauver-part-18-baldwin-testimony-1951/)); Joseph Stacher testified to the committee the same summer ([testimony](/items/kefauver-part-18-stacher-testimony-1951/)). The payment to Zwillman and Stacher is a fact recited by the Court, not a finding of wrongdoing by either.

## Sources

- CourtListener (Free Law Project), text of the opinion: https://www.courtlistener.com/opinion/104992/rutkin-v-united-states/