United States v. Walton

633 F. Supp. 1353, 1986 U.S. Dist. LEXIS 25561
CourtDistrict Court, D. Minnesota
DecidedMay 13, 1986
DocketNo. Cr. 3-86-33
StatusPublished

This text of 633 F. Supp. 1353 (United States v. Walton) is published on Counsel Stack Legal Research, covering District Court, D. Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States v. Walton, 633 F. Supp. 1353, 1986 U.S. Dist. LEXIS 25561 (mnd 1986).

Opinion

[1354]*1354ORDER

DEYITT, District Judge.

The principal issue here, whether payment for prostitution services with credit cards constitutes the use of “any facility in interstate ... commerce” under the Travel Act, 18 U.S.C. § 1952, is before the court upon defendants’ motions to dismiss certain counts of the indictment. We conclude, on the facts of this case, that it does, and defendants’ motions are therefore denied.

The gist of the twenty-four count indictment is that the defendants operated a prostitution business enterprise under the name of Walton Productions, a Minnesota corporation. The indictment alleges violations of Minnesota prostitution laws from October 1981 through 1983. Allegedly, women, including defendant Mary Ann Ferguson, employed by defendant Stanley Walton responded to phone calls to Walton Productions by providing prostitution services and accepting payment for them with major credit cards. The jurisdictional basis for alleging Travel Act violations1 is the use of credit cards to promote, manage, or distribute the proceeds of the unlawful business.

The defendants’ motions raise an issue of first impression. No published opinions address whether a credit card is a facility in interstate commerce under the Travel Act. The defendants contend that a credit card is not a facility in interstate commerce as contemplated by the Act, comparing the use of credit cards to cash. The government argues that the terms “facility in interstate commerce” have received a broad reading and that the better analogy is between credit cards and checks.

The Travel Act prohibits the use of “any facility in interstate ... commerce, including the mail, ... with intent to ... promote, manage, establish, carry on, or facilitate the promotion, management, establishment, or carrying on, of any unlawful activity, ... [including] any business enterprise involving ... prostitution offenses in violation of the laws of the State in which they were committed.” 18 U.S.C. § 1952(a)(3). The aim of extending federal jurisdiction to these traditionally local offenses is to assist local authorities in dealing with organized criminal activity, which in all cases is assisted in its operations by the availability of interstate commerce. Erlenbaugh v. United States, 409 U.S. 239, 245-46, 93 S.Ct. 477, 481-82, 34 L.Ed.2d 446 (1972). “It is, in short, an effort to deny individuals who act for such a criminal purpose access to the channels of commerce.” Id. at 246, 93 S.Ct. at 482. Thus, the crime remains “purely local” until the perpetrator facilitates his unlawful activity by using any facility in interstate commerce.

Defendants compare their case with United States v. Maze, 414 U.S. 395, 94 S.Ct. 645, 38 L.Ed.2d 603 (1974), in which the defendant was charged with violating the mail fraud statute, 18 U.S.C. § 1341. Maze absconded with his roommate’s credit card and used it to charge meals and lodging while he traveled in several states. The Court assumed that Maze “caused” the mailings of credit card invoices to the issuing bank in Kentucky. The sole issue addressed by the Court was whether the mailings “were sufficiently closely related to [the] scheme to bring [defendant’s] conduct within the statute.” 414 U.S. at 400, 94 S.Ct. at 648. It held that they were not.

Maze is of limited precedential value and support for defendant’s position. The jurisdictional elements of the mail fraud statute and the Travel Act are clearly distinguishable. Under the mail fraud statute, the defendant must: (1) cause a mailing (2) for the purpose of executing a scheme to defraud. 18 U.S.C. § 1341. Under the Travel Act, jurisdiction is also based on a two-part inquiry: (1) whether [1355]*1355the defendant used a facility in commerce, including the mail, (2) which facilitated the carrying on of the unlawful activity. 18 U.S.C. § 1952. The Maze Court did not refuse to extend the reach of the mail fraud statute to credit cards, 414 U.S. at n. 4, 94 S.Ct. at n. 4, as the defendants contend; rather it found that the mailings did not satisfy the second prong of the jurisdictional test. Id. at 405, 94 S.Ct. at 651. Thus, Maze does not stand for the proposition urged by the defendants, but lends support to the government’s position that the use of a credit card constitutes the use of a facility in interstate commerce. Processing of the credit card charge entailed use of interstate mail.

Courts of appeal construing the Travel Act have had little difficulty with the first prong of the test—whether the defendant has used a facility in commerce. Like the Court in Maze, which assumed the existence of “mailings,” the courts are more concerned with the degree of interstate use and its relation to the unlawful activity. Although the defendants specifically challenge whether a credit card is a “facility in commerce,” the circuit opinions nevertheless provide some guidance.

The Fourth, Fifth, and Sixth Circuits have applied the “straightforward and comprehensive” language of the Act in determining the jurisdictional basis of the prosecution. United States v. Pecora, 693 F.2d 421, 424 (5th Cir.1982) cert. denied, 462 U.S. 1119, 103 S.Ct. 3087, 77 L.Ed.2d 1348 (1983); United States v. Eisner, 533 F.2d 987 (6th Cir.) cert. denied, 429 U.S. 919, 97 5. Ct. 314, 50 L.Ed.2d 286 (1976); United States v. LeFaivre, 507 F.2d 1288 (4th Cir. 1974). In so doing, they have rejected any qualifying adjectives or court-made exceptions to the plain language of the statute. In Pécora, the court held that a single interstate phone call satisfied the Act. 693 F.2d at 424. In Eisner and LeFaivre, the courts held that depositing or cashing an out-of-state check constituted the use of a facility in interstate commerce. Eisner, 533 F.2d at 992; LeFaivre, 507 F.2d at 1290-97.

In contrast, the Second and Seventh Circuits interject the requirement that the interstate use “relate significantly, rather than incidentally or minimally, to the illegal activity.” United States v. Raineri, 670 F.2d 702, 717 (7th Cir.) cert. denied, 459 U.S. 1035, 103 S.Ct. 446, 74 L.Ed.2d 601 (1982); United States v. Archer, 486 F.2d 670 (2d Cir.1973). It is not always clear which prong of the jurisdictional test is modified by these words. In Raineri,

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Related

Erlenbaugh v. United States
409 U.S. 239 (Supreme Court, 1972)
United States v. Maze
414 U.S. 395 (Supreme Court, 1974)
United States v. Norman Archer
486 F.2d 670 (Second Circuit, 1973)
United States v. Louis Gustav Lefaivre
507 F.2d 1288 (Fourth Circuit, 1975)
United States v. Callie Blaine Eisner
533 F.2d 987 (Sixth Circuit, 1976)
United States v. Alex J. Raineri
670 F.2d 702 (Seventh Circuit, 1982)

Cite This Page — Counsel Stack

Bluebook (online)
633 F. Supp. 1353, 1986 U.S. Dist. LEXIS 25561, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-v-walton-mnd-1986.