"Pay us or we will report this to the police/DA/IRS/immigration"
"Settle or we'll go to the media / launch a publicity campaign / issue press releases"
"Settle immediately or your employer/spouse/family will learn about [secret]"
"Your license/visa/security clearance is at risk unless you settle"
California Penal Code §518-519 defines extortion as obtaining property through wrongful use of fear, including:
This means you CANNOT condition reporting to authorities on whether someone settles your civil claim. Violations can result in disbarment.
"If we cannot resolve this matter informally, our client will file a complaint asserting claims for breach of contract, fraud under Civil Code §1709, and unfair business practices."
Why it's safe: Limits threats to civil remedies through litigation. Describes what will happen in court, not external consequences.
"Unless you settle for $500,000 within 10 days, we will report your conduct to the District Attorney, the State Bar, and the IRS."
Why it's dangerous: Conditions reporting to authorities on payment. This is textbook extortion AND an ethics violation.
"Your conduct appears to violate Penal Code Section X. Our client reserves all rights to report this matter to appropriate authorities and to pursue civil remedies."
Why it's safe: Acknowledges potential criminal conduct but doesn't use it as leverage. Doesn't condition reporting on settlement.
"Settle this immediately or we're filing a police report about your violations of Penal Code Section X."
Why it's dangerous: Explicitly conditions criminal reporting on settlement. Violates Rule 3.10 and constitutes attempted extortion.
You CAN: Threaten civil litigation and describe remedies you'll seek through that litigation
You CANNOT: Threaten to report to authorities, expose secrets, or damage reputation UNLESS they pay you
What happened: Attorney Martin Singer sent a demand letter threatening that if the defendant didn't pay a seven-figure settlement, his client would file suit AND simultaneously launch a media campaign with press releases to major news outlets.
The result: California Supreme Court held this was criminal extortion as a matter of law. The litigation privilege didn't apply. Singer's career survived, but this case became the textbook example of what NOT to do.
The lesson: Threatening publicity campaigns in exchange for payment = extortion, even if you're a high-profile attorney.
What happened: Another Martin Singer letter, also aggressive, also mentioning potentially embarrassing facts. But this time, everything was framed in terms of what would come out through civil litigation.
The result: Court of Appeal held the letter was protected by litigation privilege. No extortion because Singer didn't threaten independent publicity or reporting to authorities—just described what would happen in court.
The lesson: You can be aggressive about anticipated litigation. You can't use publicity or criminal prosecution as separate bargaining chips.
The situation: A neighbor posted on Facebook that a licensed daycare had "10+ kids crammed in one bedroom with no background checks" and that the owner "leaves them unsupervised while she naps."
The truth: The daycare was licensed for 4 children max, owner had background checks and inspections, never left kids unsupervised.
The damage: Within 24 hours, three families withdrew children and two prospective clients canceled.
The resolution: Well-drafted cease and desist letter (focused on specific false statements, documented harm, demanded removal) led to immediate retraction without lawsuit.
The review: Former employee claimed bakery "injects old pastries with chemicals" and "uses expired cream that gave my friend food poisoning."
The facts: All false. Bakery had perfect health inspections, fresh supplier invoices, zero food poisoning reports.
The cost: Lost catering contract, 40% revenue drop over six weeks. Former employee ignored demand letter, got sued, jury awarded $75,000 plus attorneys' fees.
The lesson: Specific false factual claims (not opinions) that damage business reputation can be very expensive.
If the answer is no, redraft until the answer is yes. The stakes are too high to gamble with gray areas.
Conditioning criminal, tax, immigration, or licensing board reporting on settlement is extortion and an ethics violation.
Threatening press releases, social media campaigns, or contacting your employer/clients unless you pay is extortion.
Using personal information, affairs, or embarrassing facts as leverage for payment is civil and potentially criminal extortion.
If the letter was sent to your employer, customers, or other third parties (not just you), they may have lost litigation privilege and created defamation exposure.
DON'T:
DO:
Report to State Bar if: Attorney threatens to report you to police/DA/IRS/immigration/licensing boards unless you settle (violates Rule 3.10 in California and similar rules in most states).
Report to Law Enforcement if: The letter constitutes clear extortion (e.g., "pay $X or we'll expose your affair to your spouse and employer"). Prosecutors do charge these cases when there's written evidence.
Consider Civil Action if: You paid under duress and the threats were improper. You may be able to rescind the agreement and recover your money through a civil extortion or menace claim.