In the
United States Court of Appeals
For the Seventh Circuit
No. 09-2672
U NITED S TATES OF A MERICA,
Plaintiff-Appellant,
v.
JULIO L EIJA-SANCHEZ,
Defendant-Appellee.
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 07 CR 224—Rebecca R. Pallmeyer, Judge.
A RGUED F EBRUARY 12, 2010—D ECIDED A PRIL 8, 2010
Before E ASTERBROOK , Chief Judge, H AMILTON ,
Circuit Judge, and SPRINGMANN, District Judge.^
E ASTERBROOK, Chief Judge. An indictment returned in
2007 alleges that Julio Leija-Sanchez was the kingpin of
an organization that produced fraudulent Social Security
cards, driver’s licenses, green cards, and other documents
for aliens living in the United States unlawfully. The
^
Of the Northern District of Indiana, sitting by designation.
2 No. 09-2672
prosecutor believes that the organization generated
revenues exceeding $2.5 million a year. The indictment
alleges that many of the organization’s employees and
future customers were recruited in Mexico and smuggled
into this country.
Leija-Sanchez moved to dismiss Count III, which charges
him with violating 18 U.S.C. §1959 by arranging and
paying for the murder of Guillermo Jimenez Flores
(known as Montes), a former employee who had gone
into competition with his organization. Assassins in Leija-
Sanchez’s employ found Montes in Mexico and killed
him there. Montes was a Mexican citizen; so are the
assassins. The district court dismissed this count, con-
cluding that §1959 does not apply extraterritorially. The
United States has appealed under 18 U.S.C. §3731 ¶1.
Meanwhile the rest of the criminal prosecution is in
abeyance.
The prosecutor relies on United States v. Bowman, 260
U.S. 94 (1922), for the proposition that criminal statutes
apply even when one or more elements occurs abroad or
on the high seas. See also United States v. Vasquez-Velasco, 15
F.3d 833 (9th Cir. 1994). Leija-Sanchez contends that
Bowman is no longer good law, in light of EEOC v. Arabian
American Oil Co., 499 U.S. 244 (1991) (Aramco), and other
decisions establishing a presumption that civil statutes
do not apply to activity outside the United States. What
Bowman had said is that “the same rule of interpretation
should not be applied to criminal statutes which are, as a
class, not logically dependent on their locality for the
Government’s jurisdiction”. 260 U.S. at 98.
No. 09-2672 3
Civil decisions such as Aramco cannot implicitly
overrule a decision holding that criminal statutes are
applied differently. The main reason for requiring a clear
legislative decision before applying a civil statute to
activity outside our borders is that nations often differ
with respect to acceptable conduct. See 499 U.S. at 248.
Title VII of the Civil Rights Act of 1964, the statute at
issue in Aramco, forbids religious discrimination, but
other nations may impose religious tests. After Aramco
discharged one of its workers in Saudi Arabia, the EEOC
contended that Aramco (which has its headquarters in
the United States) must apply Title VII to its work force
worldwide. The Supreme Court concluded that the law
of the place of employment governs; that way employers
can comply fully with the laws of all nations where
they conduct operations. (A contrary conclusion might
have had the practical effect of ending the multinational
operations of businesses based in the United States, or
forcing them to move their headquarters to some other
nation.)
Nations differ in the way they treat the role of religion
in employment; they do not differ to the same extent in
the way they treat murder. They may use different ap-
proaches to defenses, burdens of proof and persuasion,
the role of premeditation, and punishment, but none
of these is at stake here. It is not as if murder were for-
bidden by U.S. law but required (or even tolerated) by
Mexican law. The crime in Bowman was fraud; the Court
observed that fraud was unlawful in all of the places
where Bowman’s scheme was implemented.
4 No. 09-2672
Whether or not Aramco and other post-1922 decisions
are in tension with Bowman, we must apply Bowman
until the Justices themselves overrule it. “If a precedent
of this Court has direct application in a case, yet appears
to rest on reasons rejected in some other line of decisions,
the Court of Appeals should follow the case which
directly controls, leaving to this Court the prerogative
of overruling its own decisions.” Rodriguez de Quijas v.
Shearson/American Express, Inc., 490 U.S. 477, 484 (1989). See
also, e.g., State Oil Co. v. Khan, 522 U.S. 3, 20 (1997). The
Supreme Court has neither overruled Bowman nor sug-
gested that the courts of appeals are free to reconsider
its conclusion.
Bowman does not hold that criminal statutes always
apply extraterritorially. It concludes that judges must
consider the language and function of the prohibition. The
statute in Bowman was designed to prevent fraud by
military contractors during and in the aftermath of World
War I. The Justices observed that, because military opera-
tions in that war took place throughout the world, the
statute must reach frauds hatched abroad. The United
States makes a similar argument about §1959, which
provides:
(a) Whoever, as consideration for the receipt of, or
as consideration for a promise or agreement to
pay, anything of pecuniary value from an enter-
prise engaged in racketeering activity, or for the
purpose of gaining entrance to or maintaining or
increasing position in an enterprise engaged in
racketeering activity, murders, kidnaps, maims,
No. 09-2672 5
assaults with a dangerous weapon, commits as-
sault resulting in serious bodily injury upon, or
threatens to commit a crime of violence against
any individual in violation of the laws of any State
or the United States, or attempts or conspires so
to do, shall be punished—[details omitted].
(b) As used in this section—
(1) “racketeering activity” has the meaning set
forth in section 1961 of this title; and
(2) “enterprise” includes any partnership,
corporation, association, or other legal entity,
and any union or group of individuals associ-
ated in fact although not a legal entity, which
is engaged in, or the activities of which affect,
interstate or foreign commerce.
Criminal businesses may be international in scope; the
indictment alleges that Leija-Sanchez’s organization
was. Section 1959 applies to enterprises that engage in
or affect “foreign commerce”; this rule cannot be imple-
mented if the existence of activities abroad prevents
application of §1959 to those acts and effects that occur
in the United States.
Leija-Sanchez assumes that a crime happens in one
place only—wherever the last element occurs. The final
element of Count III was the murder in Mexico, so on this
understanding the crime was “in” Mexico. The view that
a crime necessarily has just one situs has its basis in the
common law, see Wayne R. LaFave, Substantive Criminal
Law §§ 4.2(d), 4.4 (2d ed. 2003), but has been modified by
6 No. 09-2672
statute. Suppose Leija-Sanchez had arranged in Illinois
for Montes to be killed in Texas. He could have been
prosecuted in either state for that offense, because ele-
ments occurred in each. See 18 U.S.C. §3237(a) ¶1 (crime
“begun in one district and completed in another, or
committed in more than one district” may be prosecuted
“in any district in which [it] was begun, continued, or
completed.”); United States v. Rodriguez-Moreno, 526
U.S. 275 (1999).
If a crime occurs in the state where it is arranged and
paid for when the killing occurs in Texas, it equally occurs
in the state where it was planned when the murder is
accomplished in Mexico. Because §1959 forbids attempts
as well as completed crimes, Leija-Sanchez could be
found culpable under that statute even if Montes had
survived. (Putting out the contract, and arranging
for payment, are substantial steps that could support a
conviction for attempt.) Section 1959 forbids certain acts
in furtherance of a racketeering enterprise; the §1959
offense is not murder (or some other crime) in isolation,
but the multiple acts by which a crime such as murder
facilitates a criminal enterprise. And many of those acts,
as well as the enterprise that Leija-Sanchez sought to
advance, were located in Illinois.
Bowman itself shows that the Supreme Court does not
use a “last act” rule for defining a crime’s location. The
master of a vessel indirectly owned by the United States
decided to enrich himself by overbilling for expenses.
While in the port of Rio de Janeiro, the master bribed a
supplier to give a receipt showing that the vessel had
No. 09-2672 7
loaded (and paid for) twice as much fuel oil as it actually
purchased. The receipts were submitted by telegram
from the ship while at sea, and the Treasury paid too
much for the fuel. The last act of this scheme, cashing the
Treasury’s check, likely occurred in the United States
(Bowman is not clear on this), and at all events the
injury occurred in the United States, whose funds were
depleted. Yet Bowman thought that there was a question
about extraterritorial application because some of the
elements occurred in Brazil or at sea. The Court con-
cluded that U.S. law applies even though essential steps
occurred outside its borders.
Likewise here: some of the acts (planning and payment)
occurred in the United States, one (the killing) occurred
abroad; and the objective (reduced competition for Leija-
Sanchez’s syndicate) was realized in the United States.
See also Pasquantino v. United States, 544 U.S. 349 (2005)
(use of federal wire fraud statute to block interstate
communications, in the United States, designed to
defraud Canada of tax revenues is not an impermissible
extraterritorial application); Ford v. United States, 273 U.S.
593, 622–24 (1927) (if a criminal enterprise is carried out
in part within the United States, all of the participants,
including foreigners whose activities were entirely out-
side the United States, may be penalized). Cf. Pinkerton v.
United States, 328 U.S. 640, 647 (1946); United States v.
Macey, 8 F.3d 462, 468 (7th Cir. 1993).
Even in civil litigation, the Supreme Court has held that
the laws of this nation may be applied to multi-national
operations that have substantial effects in this nation. For
8 No. 09-2672
example, F. Hoffmann-La Roche Ltd v. Empagran S.A., 542
U.S. 155 (2004), concludes that this nation’s antitrust
laws apply to the domestic effects of foreign cartels—
though not to foreign effects that are independent of
the domestic effects. When an international cartel has
effects both within and without our borders, American
law applies to at least the domestic effects, even when
many (if not all) of the acts producing those adverse
effects occur abroad. The Court thought that this ap-
proach adequately avoided unnecessary interference
with other nations’ laws, which may tolerate (within
their own territories) effects that our antitrust laws con-
demn, while ensuring that this nation can achieve its
own ends within its territory. Cf. Restatement (Third) of
Foreign Relations §402(1) (concluding that the United
States may apply its law to conduct that either takes place
“in substantial part” within the United States or has a
“substantial effect” in this nation).
The indictment alleges that Leija-Sanchez’s conduct
took place “in substantial part” in this nation—indeed, all
of the conduct ascribed to Leija-Sanchez took place here.
And the indictment alleges that the goal of the contract
killing was to advance Leija-Sanchez’s interests in
this country by curtailing competition to his criminal
organization. This is not an antitrust case; the United
States is not trying to preserve competition in the business
of producing bogus credentials, so that aliens can buy
phony documents at lower prices. Federal policy is
instead to stamp out counterfeit-document mills. But the
principle of Hoffmann-La Roche that the United States
may redress effects in this nation of conduct abroad still
No. 09-2672 9
applies. By rubbing out Montes, Leija-Sanchez removed
not only a rival (allowing him to charge higher prices
for his illegal wares) but also a potential witness in a
prosecution such as this one. So we have both sig-
nificant conduct in the United States and significant
consequences here. Applying §1959 to this contract
killing does not violate any rule of international law and
is compatible with the norms that govern the application
of criminal statutes to international criminal enterprises.
Any international repercussions of the decision to
prosecute Leija-Sanchez are for the political branches to
resolve with their counterparts in Mexico, rather
than matters for the judicial branch. That diplomacy
has occurred already. Leija-Sanchez fled to Mexico,
which extradited him to the United States to face all of the
indictment’s charges. The United States promised not
to seek or impose the death penalty for the murder;
Mexico was satisfied with that undertaking and saw no
reason why the United States should not apply its sub-
stantive rules. Given the holding of United States v. Alvarez-
Machain, 504 U.S. 655 (1992), that prosecution in the
United States is permissible even if the defendant
arrives by kidnapping rather than formal extradition,
this prosecution is easy to support. The substantive
offense in Alvarez-Machain was the murder in Mexico, by
a Mexican national, of two persons who were helping to
enforce U.S. drug laws; the statute said to be violated in
Alvarez-Machain was 18 U.S.C. §1959, because the murders
helped an international drug ring continue in business.
The Supreme Court was not asked to hold in Alvarez-
Machain that applying §1959 in this fashion would have
10 No. 09-2672
been impermissibly extraterritorial, so its decision is not
direct authority. But we conclude that what the parties
assumed in Alvarez-Machain—that §1959 applies to
a murder in another nation designed to facilitate the
operation of a criminal enterprise in the United States—is
indeed the law.
R EVERSED
4-8-10