Where’s the Line Between a Demand Letter and Extortion? Part 1

Proudly Serving Employers

You may be thinking that the “demand” part of “demand letter” entails a strongly worded argument. But while your demand letter should be clear regarding impending legal action, it should never be threatening in any other way. Even when the other party is in the wrong, contractors can find themselves unintentionally committing a felony if they write a demand letter that is too strongly worded. 

This line between a firm demand letter and extortion isn’t always clear cut. In this two-part article, we will be discussing this distinction in detail. For aid in drafting demand letters and moving forward with subsequent legal action, consult a Houston construction lawyer from Cotney Law. 

What is Considered Extortion? 

Extortion is defined as the practice of obtaining money by threat of violence, damage to property or reputation, or unfavorable government action. Essentially, extortion is theft that threatens future consequences. While the injured party is not placed in immediate danger, an implied threat can target their personal safety, family, property, or reputation. Extortion doesn’t have to be committed in person. Telephone calls, emails, social media messages, and demand letters can be avenues for committing extortion. 

Furthermore, what can be considered extortion is far more nuanced than a threat of violence. In some cases, just accusing someone of a crime in a demand letter can be considered extortion. If you accuse an owner of committing a crime and threaten to embarrass or expose them, you may be committing extortion. 

What Are the Penalties for Committing Extortion in Texas? 

While extortion is illegal all throughout America, the penalties for it vary from state to state. In the State of Texas, the severity of the penalty for extortion depends on the amount stolen. The penalties for committing extortion in Texas are as follows: 

  • Third-degree felony: Between $30,000 and $150,000 stolen. A fine of up to $10,000 and a prison sentence of up to five years. 
  • Second-degree felony: Between $150,000 and $300,000. A fine of up to $10,000 and a prison sentence of up to 20 years. 
  • First-degree felony: Greater than $300,000 stolen. A fine of up to $10,000 and a prison sentence of up to 99 years. 

As evidenced above, going over the top and accidentally committing extortion can be an easy and costly mistake for contractors to make. As we continue this discussion in part two, we will discuss how contractors can avoid threatening language and write an effective demand letter. To ensure that your demand letters are clear, professional, and non-threatening, partner with the team of Houston construction lawyers from Cotney Law.  

If you would like to speak with one of our Houston construction lawyers, please contact us today.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.