United States v. Lyons

United States Court of Appeals
For the First Circuit

Nos. 12-1835
12-1858
UNITED STATES OF AMERICA,

Appellee,

v.

TODD LYONS
and DANIEL EREMIAN,

Defendants, Appellants.

APPEALS FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS

[Hon. Patti B. Saris, U.S. District Judge]

Before

Lynch, Chief Judge,
Thompson and Kayatta, Circuit Judges.

Peter Charles Horstmann, with whom Partridge, Ankner &
Horstmann, LLP was on brief, for appellant Todd Lyons.
Juan Chardiet, with whom Chardiet Law P.C. was on brief,
for appellant Daniel Eremian.
John M. Pellettieri, Attorney, Appellate Section,
Criminal Division, U.S. Department of Justice, with whom Mythili
Raman, Acting Assistant Attorney General, Denis J. McInerney,
Acting Deputy Assistant Attorney General, Carmen M. Ortiz, United
States Attorney, and Robert A. Fisher, Mary Beth Murrane, and Fred
W. Wyshak, Assistant U.S. Attorneys, were on brief, for appellee.

January 17, 2014
 KAYATTA, Circuit Judge. Todd Lyons and Daniel Eremian

worked for Sports Off Shore (SOS), a gambling business based in

Antigua. After a wide-ranging investigation by federal and state

law enforcement of SOS and its employees and agents, and a lengthy

trial, a jury convicted both Lyons and Eremian on two counts under

the Wire Act, 18 U.S.C. § 1084, two counts under RICO, 18 U.S.C.

§§ 1962(c) and 1962(d), and one count under 18 U.S.C. § 1955 for

conducting an illegal gambling business. Lyons was separately

convicted on another eighteen counts. In this direct appeal from

their convictions and sentences, Lyons and Eremian argue that: (1)

the district court improperly denied them a safe harbor instruction

on the government's charges that they violated the Wire Act; (2)

the Wire Act does not apply to the internet; (3) the government did

not prove they had the necessary mens rea to violate the Wire Act;

(4) their convictions involved an inappropriate extraterritorial

application of the Wire Act; (5) their Wire Act convictions should

be overturned because the government was required but failed to

prove that all relevant bets were on sporting events; and (6) the

district court improperly admitted into evidence a directory of SOS

agents.

Lyons separately argues that: (7) the district court

should have suppressed evidence derived from wiretaps of his phone

conversations; (8) the district court should have suppressed

evidence obtained pursuant to search warrants for his home, car,

-2-
and person; (9) there was insufficient evidence to convict him of

money laundering because the government's evidence did not

distinguish between "proceeds" and "profits" of illegal gambling;

(10) there was insufficient evidence to convict him of violating

the Travel Act, 18 U.S.C. § 1952, for the same reason; (11) the

absence of final implementing regulations precluded his convictions

for violating the Unlawful Internet Gambling Enforcement Act of

2006 ("UIGEA"), 31 U.S.C. §§ 5361-67; and (12) the prosecution

referred at trial to his decision not to testify, violating his

Fifth Amendment right against self-incrimination.

Eremian separately argues that: (13) venue did not lie in

Massachusetts; (14) there was insufficient evidence to convict him

of racketeering; and (15) instructing the jury on Florida law

constituted a constructive amendment of the indictment. Finally,

Lyons and Eremian each challenges his punishment, arguing that (16)

his prison sentence and the forfeiture judgment were unreasonable

and violated the Eighth Amendment.

In the remainder of this opinion, we address these

sixteen arguments in the order listed, above. For the reasons

stated, we affirm the convictions and sentences, though we affirm

Lyons's Wire Act convictions in one limited respect on a basis

different from that employed by the district court.

-3-
 I. Background

SOS was a bookmaking business founded in 1996 by Robert

Eremian, Daniel Eremian's brother.1 SOS centered its operations in

Antigua at least in part because some forms of bookmaking are legal

there. Many of SOS's customers, however, were in the U.S. and SOS

took bets by phone or over the internet from the U.S. Most SOS

customers bet on team sports, but others bet on horse racing or on

casino games played on the SOS website. SOS allowed bettors to

place bets against funds placed on deposit with SOS, or on credit.

Antiguan regulatory law allowed the former but, at least between

2001 and 2007, prohibited betting on credit.

A bettor who wished to place bets on credit with SOS

received a password and a customer code for placing bets through

the internet or by phone. SOS employed agents in the United

States, including Eremian and Todd Lyons, to "settle up" with

credit bettors, collecting losses from losers and making payments

to winners. These agents met with bettors in person in public

places and primarily conducted transactions in cash or by receiving

checks. Each agent managed a group of regular customers and

received as a commission a percentage of those customers' losses.

Some agents also employed sub-agents who managed their own

1
This opinion will always refer to Robert Eremian by his
full name. "Eremian," on its own, will be used to refer to Daniel
Eremian.

-4-
customers and shared commissions with the agents under whom they

worked.

After deducting their commissions from the money leftover

once customers settled up, the agents sent the balance to SOS in

Antigua. Agents often sent this balance in cash, sometimes using

a "six pack," a package containing three bundles of $2,000. SOS

agents also carried cash to Antigua in person. Agents also

transferred or caused their customers to transfer funds to Antigua

by check or wire transfer.

Daniel Eremian played an important role in the SOS

operation from its inception. He helped his brother establish the

SOS office in Antigua, training Antiguan employees about how to

answer the phone and take bets. After SOS was established, Eremian

returned to the United States where he worked as an SOS agent. He

recruited customers in Florida. He also employed at least three

sub-agents. Like other SOS agents, Eremian provided bettors with

the information needed to place bets with SOS on credit and settled

up with customers, either in-person or through his sub-agents. On

at least one occasion, Eremian also collected funds from another

agent on behalf of SOS.

Todd Lyons came to SOS later than Eremian, but ended up

playing a larger role in SOS's Massachusetts operation than Eremian

played in Florida. Like many agents, Lyons was a bettor with SOS

before he became an agent. But at some point between 1997 and 2000

-5-
Lyons became an SOS agent. Like other SOS agents, Lyons provided

customers with the information they needed to make bets. He also

collected losses and distributed winnings. Lyons had at least one

sub-agent. In addition to working as an agent, Lyons also served

as "the bank" for SOS in Massachusetts, collecting money from, and

disbursing it to, other agents. Starting in 2000, SOS paid Lyons

a salary for this managerial role.

Lyons first drew the attention of Massachusetts state

police investigating an illegal bookmaker in Boston. Police and

prosecutors sought and received a wiretap of Lyons's cell phone.

This wiretap led to warrants for searches of Lyons's home, car, and

person conducted in January, 2006. The search of Lyons's home

uncovered records of bets and cash disbursements, and a substantial

quantity of cash, including $34,318 in a briefcase and $50,000 in

the leg of a pair of pants in a drawer. The Massachusetts State

Police continued to investigate Lyons until 2009, when they

executed a second search warrant for his house, finding $93,800

hidden above two ceiling tiles and more gambling records. A

federal grand jury indicted Lyons in May, 2010. A superseding

indictment was filed in August, 2010, charging Daniel Eremian,

Robert Eremian, Lyons, and Richard Sullivan, another important

figure in SOS. As of March 1, 2012, Robert Eremian and Sullivan

were fugitives.

-6-
 II. Analysis

We first address Lyons's and Eremian's common challenges

to their convictions, then their individual challenges to their

convictions, and finally their challenges to their sentences.

1. The Safe Harbor Provision of the Wire Act

Both Lyons and Eremian were convicted on two counts of

violating the Wire Act by transmitting bets or betting information

or assisting the transmission of bets over a wire communication

facility. One count charged them with violating the Wire Act using

telephones, the other with violating the Wire Act using the

internet. In a challenge directed at both counts, they argue that

the district court erred by failing to instruct the jury on the

safe harbor provision of the Wire Act, 18 U.S.C. § 1084(b), which

exempts from liability certain communications assisting in the

transmission of bets between places where betting on sports is

legal.

We review preserved claims of instructional error de

novo. United States v. Baird, 712 F.3d 623, 627-28 (1st Cir.

2013). If this de novo review concludes that "the evidence at

trial, taken in the defendant's favor, was sufficient to support

his requested instruction, then we move to a three-part test to

decide whether the district court's refusal to give the instruction

constitutes reversible error." Id at 628. Reversal is only

appropriate if the requested instruction was "(1) substantively

-7-
correct as a matter of law, (2) not substantially covered by the

charge as rendered, and (3) integral to an important point in the

case so that the omission of the instruction seriously impaired the

defendant's ability to present his defense." Id.

For the following reasons, we find that Eremian was not

entitled to an instruction on the safe harbor provision, and that

it makes no difference whether Lyons was entitled to such an

instruction.

a. Statutory Background

The Wire Act has two provisions relevant to Lyons and

Eremian. Section 1084(a) creates criminal liability:

Whoever being engaged in the business of betting or
wagering knowingly uses a wire communication facility for
the transmission in interstate or foreign commerce of
bets or wagers or information assisting in the placing of
bets or wagers on any sporting event or contest, or for
the transmission of a wire communication which entitles
the recipient to receive money or credit as a result of
bets or wagers, or for information assisting in the
placing of bets or wagers, shall be fined under this
title or imprisoned not more than two years, or both.

Section 1084(b) creates an exception to section 1084(a) applicable

to certain transmissions of information assisting in the placing of

bets:

Nothing in this section shall be construed to prevent
. . . the transmission of information assisting in the
placing of bets or wagers on a sporting event or contest
from a State or foreign country where betting on that
sporting event or contest is legal into a State or
foreign country in which such betting is legal.

-8-
 Two aspects of this safe harbor provision are pertinent

to our analysis in this case. First, the safe harbor provision

only applies when gambling on the events in question is legal in

both the sending and receiving jurisdiction. Thus, for example, if

New York allows betting on horses at race tracks in New York, and

if Nevada allows betting in Nevada on the results of New York horse

races, then information may be wired from New York to Nevada to

assist in the betting in Nevada without violating the statute. See

H.R. Rep. No. 87-967, reprinted in 1961 U.S.C.C.A.N. 2631, 2632-33.

Second, the safe harbor provision only applies to the transmission

of "information assisting in the placing of bets." The safe harbor

provision does not exempt from liability the interstate

transmission of bets themselves. See United States v. McDonough,

835 F.2d 1103, 1104-05 (5th Cir. 1988); United States v. Bala, 489

F.3d 334, 342 (8th Cir. 2007).

In this manner, the Wire Act prohibits interstate

gambling without criminalizing lawful intrastate gambling or

prohibiting the transmission of data needed to enable intrastate

gambling on events held in other states if gambling in both states

on such events is lawful.

b. Applying Section 1084(b) to Lyons and Eremian

Lyons and Eremian sought protection under

section 1084(b)'s safe harbor provision in two ways: they argued

that they were entitled to an acquittal as a matter of law because

-9-
all of their charged Wire Act violations fell within the safe

harbor provision; and they argued in the alternative that, at the

very least, the district court should have instructed the jury on

the safe harbor provision because some of their activities fell

within it.

Eremian's effort to rely on the safe harbor provision in

this manner is a non-starter. Many transmissions he caused were

from Florida. He advances no argument that the bets made by SOS

bettors in Florida were legal in Florida. Nor could he. See Fla.

Stat. § 849.14. Simply put, there was no evidence at all to

support his argument that the safe harbor provision could apply to

him and therefore no error in denying him an instruction on it.

Cf. Baird, 712 F.3d at 627. A fortiori, it follows that the safe

harbor did not render insufficient the evidence marshaled against

him.

Lyons had a better potential argument regarding the safe

harbor because it is not clear that either Massachusetts or Antigua

makes sports betting illegal. Both Massachusetts and Antigua law

place limits on gambling, but otherwise allow it. Antigua appears

to generally allow bets on sporting events, although bets may not

be placed on credit. Massachusetts law criminalizes betting by

telephone. Mass. Gen. Laws ch. 271, § 17A. It also criminalizes

the operation and patronizing of gaming houses, id. at § 5, and the

manufacture and sale of gaming devices. Id. at § 5A. The

-10-
government, though, points to no Massachusetts law effectively

criminalizing betting on sporting events generally. The government

nevertheless argues that the bets placed from Massachusetts to

Antigua cannot be within the safe harbor provision because they

violated the Antiguan gaming regulations. Lyons counters that a

bet is "legal" for the purposes of the Wire Act as long as "betting

on that sporting event . . . is legal," 18 U.S.C. § 1084(b), in the

jurisdiction. Cf. Bala, 489 F.3d at 341-42 (8th Cir. 2007)

(holding that non-compliance with statutory requirement that

parimutuel betting businesses donate a portion of their proceeds to

charity did not mean that betting at those business was "illegal"

for purposes of section 1084(b)). But cf. United States v. Cohen,

260 F.3d 68, 73-74 (2d Cir. 2001) (holding that sports betting was

"illegal" under section 1084(b) where it was not a crime but was

generally prohibited by law and the state constitution).

We need not resolve this dispute. Specifically, in

Lyons's case, we need not decide if some of the activity for which

he was indicted fell within the safe harbor. Rather, because the

evidence was overwhelming that he also engaged in other activity

clearly outside the safe harbor, for which he was indicted under

the same count, his arguments based on the safe harbor must fail.

Where a jury is properly instructed on two theories of guilt, one

of which is later determined to be invalid, "we can affirm the

conviction only if we conclude 'beyond a reasonable doubt' that

-11-
'the jury verdict would have been the same absent the error.'"

United States v. Zhen Zhou Wu, 711 F.3d 1, 30 (1st Cir. 2013)

(quoting Neder v. United States, 527 U.S. 1, 17 (1999)). Here,

given the overwhelming evidence of Lyons's guilt under an aiding

and abetting theory, the district court's refusal to instruct the

jury on the safe harbor defense arguably applicable to some of

Lyons's acts provides no cause for reversal. A fortiori, his

sufficiency argument based on the safe harbor must similarly fail.

The indictment on the two Wire Act counts charged Lyons

not just with transmitting information assisting in the placing of

bets, but also with aiding and abetting the use of a wire

communication facility for the transmission of bets. It alleged

that "Eremian . . . Lyons, and others unknown to the grand jury,

each aiding and abetting the other, being engaged in the business

of betting and wagering, knowingly used a wire communication

facility for the transmission in interstate and foreign commerce of

bets and wagers . . . on any sporting event or contest." Receiving

bets is "use" of a wire communication facility. See Sagansky v.

United States, 358 F.2d 195, 200 (1st Cir. 1966). Under 18 U.S.C.

§ 2(a) "[w]hoever commits an offense against the United States or

aids, abets, counsels, commands, induces or procures its

commission, is punishable as a principal." Therefore, if Lyons

aided and abetted the receipt of bets by SOS he falls outside the

protection of the safe harbor provision.

-12-
 An aider and abettor is punishable as a principal if,

first, someone else actually committed the offense and, second, the

aider and abettor "became associated with the endeavor and took

part in it, intending to ensure its success." United States v.

Spinney, 65 F.3d 231, 235 (1st Cir. 1995). "The central

requirement of the second element is 'a showing that the defendant

consciously shared the principal's knowledge of the underlying

criminal act, and intended to help the principal.'" Id. (quoting

United States v. Taylor, 54 F.3d 967, 975 (1st Cir. 1995)). Lyons

was not required to know the exact details of each individual

transaction to be liable as an aider and abettor--it is sufficient

that he knew of SOS's receipt of bets and knowingly helped it

continue to receive them. See United States v. Davis, 717 F.3d 28,

33 (1st Cir. 2013) ("[A] culpable aider and abettor need not

perform the subject offense, be present when it is performed, or be

aware of the details of its execution." (internal quotation marks

omitted)); United States v. Hernandez, 218 F.3d 58, 65 (1st Cir.

2000) (knowledge of all details of a drug transaction not needed

for aiding and abetting liability).

Any reasonable jury would necessarily have found beyond

a reasonable doubt that Lyons aided and abetted SOS's receipt of

inter-jurisdictional bets. The core mission of SOS was to engage

in the business of interstate gambling on, among other things,

sporting events, by causing and receiving the interstate and

-13-
foreign transmission of wagers. It could not do this without

receiving bets. Lyons's efforts for over a decade were dedicated

to facilitating that business. Lyons handled millions of dollars

in proceeds from SOS agents in Massachusetts. He functioned as

SOS's "bank" in the state, collecting bettors' losses, distributing

winnings, and collecting money from and distributing it to SOS

agents. SOS paid him a salary for this role. SOS would have

received no bets had it lacked a way to settle up with bettors and

so Lyons' role was critical to its receipt of bets.

Like other agents Lyons also aided and abetted the

receipt of bets by SOS by functioning as an agent. Witnesses

described Lyons as the agent who provided them with the information

they needed to place bets with SOS, collected losses from them, and

distributed winnings. He also specifically directed at least one

bettor to make payments to SOS by wire transfer to settle up bets

placed with SOS. Perhaps the best evidence that Lyons intended to

ensure SOS's success by these actions, besides the actions

themselves, is that he received a commission of 50 percent of the

losses of the bettors he personally managed. Lyons was a critical

part of SOS's operation and thereby demonstrated a clear intent to

further SOS's business of receiving illegal inter-jurisdictional

sports bets by phone and over the internet.

Nor could Lyons avoid liability for aiding and abetting

the commission of a crime even if he could show that some of the

-14-
charged conduct could have been performed lawfully. It is

perfectly legal to drive a friend to the bank, but doing so with an

intent to help him rob it is a crime. See Spinney, 65 F.3d at 235

(1st Cir. 1995). Similarly, accompanying a friend to a business

meeting is not a crime, but doing so with an intent to further the

sale of cocaine is. See United States v. Paone, 758 F.2d 774, 776

(1st Cir. 1985). And while working as a crewman on a boat is

legal, doing so with an intent to aid its transportation of

marijuana is not. See United States v. Cuevas-Esquivel, 905 F.2d

510, 515 (1st Cir. 1990). Many of Lyons's actions, moreover,

violated other criminal statutes as the other counts he was

convicted of show, and so this is not even a situation in which

aiding and abetting liability transforms otherwise purely lawful

conduct into criminal action. The two specific payments to SOS

Lyons was convicted of causing, for example, formed the basis of

Lyons's money laundering conviction we affirm below. Given the

clear evidence of Lyons's intent to further SOS's receipt of bets

in violation of the Wire Act we therefore have no trouble affirming

his conviction on this basis.

2. The Internet and the Wire Act

Lyons and Eremian argue for the first time on appeal that

they should have been granted an acquittal as a matter of law on

the Wire Act count that was based on the transmission of

information over the internet because, they claim, the internet is

-15-
not a "wire communication facility." They did not raise this

specific argument in their post-trial motion for acquittal, in

which they objected generally to the sufficiency of the evidence,

but also made certain other specific objections. Normally, a

general objection to the sufficiency of the evidence preserves all

possible sufficiency arguments, but we have also suggested that a

defendant who raises only specific sufficiency arguments waives all

those he does not make. See United States v. Marston, 694 F.3d

131, 134 (1st Cir. 2012) (collecting cases for both propositions).

We have not decided what happens when a general sufficiency

objection is accompanied by specific objections, but we have

suggested, albeit in dictum, that such a practice preserves all

possible objections because: "[i]t is helpful to the trial judge to

have specific concerns explained even where a general motion is

made; and to penalize the giving of examples, which might be

understood as abandoning all other grounds, discourages defense

counsel from doing so and also creates a trap for the unwary

defense lawyer." Id. at 135. We need not decide the issue,

however, because, whatever the standard of review, the sufficiency

challenge fails.

The sufficiency challenge fails because the internet is

an "instrumentalit[y] . . . used or useful in the transmission of

writings, signs, pictures, and sounds of all kinds by aid of wire,

cable, or other like connection between the points of origin and

-16-
reception of such transmission." 18 U.S.C. § 1081; see also United

States v. Cohen 260 F.3d 68, 76 (2d Cir. 2001) (transmitting bets

over the internet violated the statute because it involved

transmission to and from customers of betting information). Anyone

reading this opinion on the court's website or the like would

readily agree that the internet is used and useful in the

transmission of writings. Indeed, it is rather remarkable that a

definition written before the internet was invented so accurately

describes it. When, as here, the text of a statute "provides a

clear answer" to a question of statutory construction our "inquiry

ends." United States v. Robinson, 459 F.3d 39, 51 (1st Cir. 2006).

The Wire Act's evident applicability to the internet likewise means

that its application to Lyons and Eremian is not, contrary to their

claims, an impermissible ex post facto "novel construction of a

criminal statute to conduct that . . . the statute . . . has [not]

fairly disclosed to be within its scope." United States v. Lanier,

520 U.S. 259, 266 (1997).

The argument to the contrary relies on two

misapprehensions: First, that the Wire Act cannot be applied to

communications over the internet because the Act was enacted in

1961, before the internet was created and, second, that because the

internet is in some manner structurally dissimilar to a telephone

or telegraph system, the Wire Act cannot apply to it. On the first

point, we regularly apply statutes to technologies that were not in

-17-
place when the statutes were enacted. See, e.g., Sec. & Exch.

Comm'n v. SG Ltd., 265 F.3d 42, 55 (1st Cir. 2001) (Securities Act

of 1933 and Securities Act of 1934 applied to virtual shares which

exist only in online game); United States v. Nichols, 820 F.2d 508,

511 (1st Cir. 1987) (theft statute applied to theft of information

from computer network). As for the second point, nothing in the

statute suggests that any instrumentality covered by the Wire Act

must be structurally similar to a telephone exchange.

Nor is it relevant that the internet is not a common

carrier, as Lyons and Eremian argue. While section 1084(d) does

impose certain requirements on common carriers who are informed

their facilities are being used for gambling, nothing in section

1084 or section 1081 limits the application of the Wire Act to

transmissions made via common carriers.2

2
Lyons and Eremian also argue that "[r]epeated unsuccessful
efforts by the [sic] Congress to amend the Wire Act are further
evidence that it does not apply to Internet-gambling of whatever
type." Even if unsuccessful attempts to amend a statute decades
after it was passed were relevant to our interpretation of that
statute, which we doubt, Lyons and Eremian point only to evidence
that Congress sought to amend the Wire Act to criminalize forms of
gambling other than sports betting. See In re MasterCard Int'l
Inc., Internet Gambling Litig., 132 F. Supp. 2d 468, 480 (E.D. La.
2001) aff'd sub nom In re MasterCard Int'l Inc., 313 F.3d 257 (5th
Cir. 2002). Elsewhere, Lyons and Eremian suggest that the passage
of UIGEA suggests that Congress felt that the Wire Act did not
apply to the internet either because it felt the need to pass
legislation particularly targeting internet gambling or because
"Congress could have used this occasion to amend/modernize the Wire
Act to specifically include the Internet" but declined to do so.
However, Congress made clear when it passed UIGEA that it did not
modify existing gambling laws. 31 U.S.C. § 5361(b).

-18-
 3. Mens Rea and the Wire Act

Lyons and Eremian also argue that the government did not

prove they had the necessary mens rea to violate the Wire Act.

What exactly they say the government failed to prove is unclear.

Reading their pleading generously, they appear to argue that even

if the internet is a wire communication facility as a matter of

law, the government was required to prove that they knew the law.

While there are certainly good reasons why Congress might not wish

to punish as criminals persons who do not know their conduct may be

unlawful, as a general matter ignorance of the law is no defense.

See Bryan v. United States, 524 U.S. 184, 193 (1998) ("[U]nless the

text of the statute dictates a different result, the term

'knowingly' merely requires proof of knowledge of the facts that

constitute the offense." (footnote omitted)); United States v.

Cohen, 260 F.3d 68, 76 (2d Cir. 2001) (In proving mens rea under

the Wire Act, it "mattered only that [the defendant] knowingly

committed the deeds forbidden by § 1084, not that he intended to

violate the statute."). Moreover, it is widely known that many

forms and means of gambling are regulated or prohibited.

Certainly, persons engaged in wide-ranging gambling operations and

storing large sums of cash in socks, ceilings, and "six-packs" are

not engaged in the types of conduct that would justify applying any

exception to the general rule that ignorance of the law is no

excuse.

-19-
 4. Extraterritoriality and the Wire Act

Lyons's and Eremian's convictions were not an improper

extraterritorial application of the Wire Act. It is a

"longstanding principle of American law that legislation of

Congress, unless a contrary intent appears, is meant to apply only

within the territorial jurisdiction of the United States." Equal

Opportunity Emp't Comm'n v. Arabian Am. Oil Co., 499 U.S. 244, 248

(1991) (internal quotation marks omitted), superseded in part by

statute, see Arbaugh v. Y&H Corp, 546 U.S. 500, 512 n.8 (2006).

The Wire Act expresses such a contrary intent because it explicitly

applies to transmissions between the United States and a foreign

country. 18 U.S.C. § 1084; cf. Pasquantino v. United States, 544

U.S. 349, 371-72 (2005) (stating that "the wire fraud statute

punishes frauds executed in 'interstate or foreign commerce,'" and

therefore can be applied extraterritorially because Congress did

not have "only 'domestic concerns in mind.'" (quoting 18 U.S.C.

§ 1343 and Small v. United States, 544 U.S. 385, 388 (2005))). The

communications giving rise to these convictions had at least one

participant inside the United States and therefore fall within the

statute's scope.

5. Proof of Sports Betting under the Wire Act

The Wire Act applies only to "wagers on any sporting

event or contest," that is, sports betting. 18 U.S.C. 1084(a); see

also In re MasterCard Int'l Inc., 313 F.3d 257, 263 (5th Cir.

-20-
2002). Therefore, Lyons and Eremian say, there was insufficient

evidence to convict them because some evidence at trial showed that

SOS also accepted bets on casino games and other forms of gambling

not covered by the Wire Act. But nothing in the statute limits its

reach to entities devoted exclusively to sports betting any more

than a bank robber gets off if he also withdraws money properly

from an ATM. The district court instructed the jury that the Wire

Act only applied to sports betting. And there was amply sufficient

evidence that Lyons and Eremian, at least, aided and abetted the

receipt of sports bets. SOS was, after all, "Sports Off Shore,"

not "Slots Off Shore." It advertised itself as a place to bet on

sports, it published odds for sports bets, and its customer-

witnesses testified that they placed bets on sports and paid their

losses to Lyons and Eremian.

6. The Evidentiary Challenge to a Purported Directory
of SOS Customers

At trial, Lyons and Eremian unsuccessfully objected to

the government's introduction of a directory of SOS customers and

agents. We review preserved evidentiary claims for abuse of

discretion. See United States v. Rivera-Donate, 682 F.3d 120, 131

(1st Cir. 2012). After initially admitting the directory but

reserving judgment on whether it could be admitted for the truth of

the matter asserted, the district court later determined that it

could be so admitted under Federal Rule of Evidence 801(d)(2)(E),

which covers statements of a defendant's coconspirators.

-21-
Statements can only be admitted under Rule 801(d)(2)(E) if the

district court finds by a preponderance of the evidence "(1) the

existence of a conspiracy, (2) the defendant's membership in that

conspiracy, (3) the declarant's membership in the same conspiracy,

and (4) that the statement be made in furtherance of the

conspiracy." Rivera-Donate, 682 F.3d at 131. The district court

made such a finding.3

There is more than enough evidence in the record to

conclude that the district court did not abuse its discretion by

admitting the directory. Each page of the exhibit is titled "agent

directory" and has the names and addresses of bettors along with a

column labeled "limit" which contains numbers between 0 and 15,000.

The directory was turned over to police by government witness Linda

Richardson. Richardson testified that she helped her "lover and

best friend, mostly best friend" Richard Sullivan, who was named in

the indictment but is currently a fugitive, transfer and store

money related to SOS. She found the directory within SOS business

records Sullivan left in her possession, but testified that she had

no prior knowledge that it existed. She recognized at least one

3
Lyons and Eremian claim that the directory was admitted
under Federal Rule of Evidence 803(6)(B) but in fact the district
court's references to United States v. Petrozziello, 548 F.2d 20,
23 (1st Cir. 1977), and to finding evidence of a conspiracy show
that the court understood the evidence to be introduced under Rule
801(d)(2)(E). Indeed, Petrozziello actually represents a rule for
the admission of evidence under Rule 802(d)(2)(E) which is narrower
than that currently in effect. See United States v. Goldberg, 105
F.3d 770, 775-76 (1st Cir. 1997).

-22-
name on it as someone who had given or received a check to or from

Richard Sullivan. The ledger also contained names and addresses

for Daniel Eremian and Todd Lyons. Several other witnesses

identified names on the list as SOS customers or agents, and some

clarified that the agent number on the top of each page represented

an SOS agent while the other names on that page were his customers.

Records that can be shown by a preponderance of the

evidence to have been made by a member of a conspiracy may be

admitted under Rule 801(d)(2)(E) even if their precise author

cannot be identified. See, e.g., United States v. De Gudino, 722

F.2d 1351, 1355 (7th Cir. 1983); United States v. Smith, 893 F.2d

1573, 1577-78 (9th Cir. 1990); cf. United States v. Alosa, 14 F.3d

693, 697 (1st Cir. 1994) (records of a conspiracy admissible where

"the district court expressly found by a preponderance of the

evidence that the ledgers were made by conspirators in furtherance

of the conspiracy."). Here, there was strong evidence that the

directory was authored by Richard Sullivan or someone else involved

with SOS because it contained information that would only have been

available to someone in the illegal gambling conspiracy that was

SOS and would have only been of use to someone managing SOS agents.

And the record well supported the finding that Lyons and Eremian

were members of that same conspiracy.

Lyons and Eremian also argue that, even if admission of

the directory was correct under the Federal Rules of Evidence, it

-23-
nonetheless violated the Sixth Amendment's Confrontation Clause.

But they misunderstand the Confrontation Clause, mistakenly

believing it confers a general right to cross-examine the source of

all evidence introduced at trial. Instead, the Confrontation

Clause applies only to testimonial evidence; that is, evidence

produced with a "primary purpose of creating an out-of-court

substitute for trial testimony." Michigan v. Bryant, 131 S. Ct.

1143, 1155 (2011). For this reason, "[b]usiness and public records

are generally admissible absent confrontation . . . because--having

been created for the administration of an entity's affairs and not

for the purpose of establishing or proving some fact at trial--they

are not testimonial." Melendez-Diaz v. Massachusetts, 557 U.S.

305, 324 (2009). For the same reason, the directory was not

testimonial.

7. The Lyons Wiretaps

The initial wiretap application targeted a phone used by

a member of another gambling operation and was filed on October 12,

2005. After that application was approved, assistant district

attorneys filed a series of renewal applications that expanded the

initial authorization to include additional telephone numbers,

including, on December 8, 2005, Lyons's number. Lyons was recorded

both on his own phone and on others' phones. Before trial, Lyons

moved to suppress evidence derived from all of these wiretaps.

-24-
 While Lyons's brief conflates several distinct legal

issues in its discussion of the wiretaps, he essentially makes

three arguments: First, that the district court's decision that

gambling is legal in Massachusetts means the wiretap applications

were not supported by probable cause and the evidence derived from

them should therefore be suppressed. Second, that the wiretaps

were not authorized by the Essex County District Attorney and

therefore were granted in violation of federal law and should be

suppressed or at least should have been subject to challenge in an

evidentiary hearing. Third, that even if the wiretaps were in fact

authorized they should be suppressed because the initial wiretap

application did not facially demonstrate that it was properly

authorized. We address these arguments in turn.

a. Probable Cause for the Wiretaps

Lyons argues for the first time on appeal that the police

lacked probable cause for the wiretaps. "A party waives [a

suppression argument under rule 12(c)] . . . not raised by the

deadline the court sets." Fed. R. Crim. P. 12(e). Here, Lyons did

not raise this argument at all below. While "[f]or good cause, the

court may grant relief from the waiver," id., Lyons has not

addressed the waiver issue at all, let alone explained why he has

good cause to seek relief from it. Despite Rule 12's clarity, we

have suggested in the past that we may sometimes nonetheless review

unpreserved suppression claims for plain error. See United States

-25-
v. Nuñez, 19 F.3d 719, 723 n.10 (1st Cir. 1994) (noting that some

courts have conducted plain error review of claims waived under

what was then Rule 12(f) and is now Rule 12(e), but also that this

is not necessarily required). More recently, however, we have

emphasized the categorical language of Rule 12(e) and made clear

that it is "'manifestly unfair'" to the prosecution to allow the

defendant to raise on appeal a suppression claim that was not

raised below, even if suppression of the same evidence was sought

on other grounds. United States v. Crooker, 688 F.3d 1, 9 (1st

Cir. 2012) (quoting United States v. Walker, 665 F.3d 212, 228 (1st

Cir. 2011)). We see no reason to find that manifest unfairness

absent here.

b. Authorization of the Wiretaps

Lyons did timely raise in the district court his other

two challenges to the wiretaps. The standard of review for

preserved suppression arguments can be somewhat confusing because

such motions interweave questions of fact and law:

When reviewing a challenge to a district court's decision
on a suppression motion, we review the district court's
factual findings and credibility determinations only for
clear error. United States v. Camacho, 661 F.3d 718, 723
(1st Cir. 2011); see Ornelas [v. United States, 517 U.S.
[690,] 699 . . . [(1996)] (findings of historical fact
reviewed for clear error). We review the court's legal
conclusions de novo. United States v. Rabbia, 699 F.3d
85, 89 (1st Cir. 2012). That being said, it is also true
that we 'give due weight to inferences drawn from
historical facts by resident judges and local law
enforcement officers.' Ornelas, 517 U.S. at 699 . . . .
As explained in United States v. Townsend, 305 F.3d 537
(6th Cir. 2002), the district court, which observes the

-26-
 testimony of the witnesses and understands local
conditions, is at an institutional advantage in making
this determination. Id. at 542. "Accordingly, 'due
weight' should be given to the inferences drawn from the
facts by 'resident judges.'" Id. (quoting Ornelas, 517
U.S. at 698).

United States v. Dapolito, 713 F.3d 141, 147 (1st Cir. 2013).

Lyons's first preserved argument is that the wiretap

applications were not reviewed by the Essex County District

Attorney and are therefore invalid. Lyons is correct that a

wiretap sought by state law enforcement must be authorized by the

principal prosecuting attorney for the jurisdiction--either the

state attorney general or the county district attorney, in this

case the Essex County District Attorney. 18 U.S.C. § 2516(2).

Under Massachusetts law, the principal prosecuting attorney need

not himself appear in court in support of every wiretap

application. Instead, he may specially designate a subordinate to

exercise his authority on a case by case basis, but only in writing

and after he has personally reviewed the wiretap application.

Mass. Gen. Laws. ch. 272, § 99(F)(1); see also United States v.

Smith, 726 F.2d 852, 857-58 (1st Cir. 1984) (citing Commonwealth v.

Vitello, 367 Mass. 224 (1975)).

The Essex County District Attorney, Jonathan Blodgett,

signed letters authorizing two assistant district attorneys to file

-27-
the first wiretap application at issue here.4 One letter was

addressed to the state justice receiving the application and the

other was addressed to the assistant district attorneys being

specially designated. In addition to authorizing the assistant

district attorneys to file the applications, the letter to the

state justice explained that "all of [the wiretap applications]

shall be reviewed by me or my designee before being presented to

you."

Standing on its own, this letter might be insufficient

because Massachusetts requires that the district attorney

personally review the application--a designee is insufficient.

Vitello, 367 Mass. at 231-32. However, in an initial ruling on the

suppression motion, the district court determined that "[t]he fact

that the designation letter, the letter to [the state justice], and

the warrant application were all dated October 12 supports the

reasonable inference that they were all presented together and that

D.A. Blodgett was familiar with the contents of the application."

This inference was not clearly erroneous. The district court

therefore properly denied the suppression motion as to the phone

numbers listed in the October 12th application.

4
The actual warrant applications are not part of the record
on appeal or available on the district court docket. There is no
dispute, however, that the initial wiretap at issue was sought by
the assistant district attorneys designated by District Attorney
Blodgett and so nothing in the wiretap applications is relevant to
the issue before us.

-28-
 Because the district court was uncertain whether

Massachusetts law required re-designation and personal review by

the district attorney when new numbers were added to an existing

wiretap, it ordered District Attorney Blodgett to file "an

affidavit regarding his authorization of the particular amendments

at issue . . . ." District Attorney Blodgett filed such an

affidavit in which he made clear that he "personally reviewed each

and every renewal application" prior to its submission and that he

intended the specially designated assistant district attorneys to

oversee the entire investigation, including both the original

wiretaps and the "renewals." The affidavit also stated that, as

the district court inferred in its initial ruling, District

Attorney Blodgett did in fact personally authorize the October 12th

wiretap application. The district court therefore denied the

suppression motion as to the remaining wiretaps.

We have previously held that, in combination with letters

substantially equivalent to the ones that accompanied the initial

application in this case, an affidavit like that submitted by

District Attorney Blodgett is sufficient to establish actual

authorization. United States v. Albertelli, 687 F.3d 439, 443 (1st

Cir. 2012). We therefore have no reason to question the district

court's factual finding that each wiretap application was

specifically and personally authorized by District Attorney

Blodgett as Massachusetts and federal law require. The district

-29-
court also did not err by failing to hold an evidentiary hearing

because the court inquired into the particular circumstances and

"the only material dispute was not about what happened but whether

the district attorney's version of what he did was sufficient

oversight." Id. Certainly Lyons points to no evidence he could

have sought to introduce or discover at an evidentiary hearing

which could have contradicted District Attorney Blodgett's version

of events. Nor does he point even to a question he might have

asked Blodgett. We therefore face similar facts as in Albertelli

and so reach the same result--the wiretap was properly authorized.5

c. Facial Sufficiency of the Wiretap Application

Lyons also argues that the wiretap evidence should be

suppressed because, even if the warrant was properly authorized, it

did not make clear on its face that it had been reviewed by

District Attorney Blodgett. This argument conflates two separate

sections of the federal law governing wiretaps, Title 18, sections

2516 and 2518. Section 2516 sets out the substantive requirements

for the authorization of a wiretap, including the requirement of

review by the principal prosecuting attorney, while section 2518

sets out the procedure by which wiretaps can be requested. Nothing

5
Lyons also suggests that he had a right to confront
District Attorney Blodgett. Again, he misunderstands the
Confrontation Clause. See United States v. Mitchell-Hunter, 663
F.3d 45, 51-52 (1st Cir. 2011) (collecting "extensive case law
declining to apply the confrontation right to various pre- and
post-trial proceedings").

-30-
in section 2518 requires that a wiretap application itself contain

proof that it has been reviewed by the principal prosecuting

attorney. United States v. Vento, 533 F.2d 838, 859-60 (3d Cir.

1976) (Authorization letter did not need not be shown to the

issuing judge.); see also United State v. Chavez, 416 U.S. 562, 575

(1974) (Evidence derived from a wiretap did not need to be

suppressed where "misidentification of the officer authorizing the

wiretap application [in the application] did not affect the

fulfillment of any of the reviewing or approval functions required

by Congress."). Instead, the application must only state "the

applicant's authority to make such application." 18 U.S.C.

§ 2518(1).6

The designation letter made clear that District Attorney

Blodgett authorized the application. Our conclusion that proof of

review by the district attorney is not required on the face of the

application also follows from United States v. Smith, 726 F.2d 852,

860 (1st Cir. 1984), in which we recognized that failure to include

proof of authorization in the application could be remedied by

subsequently produced evidence of authorization.

6
The distinction between the identity of the authorizing
official, which must be present on the face of the application, and
proof of authorization, which need not be included, is critical.
Lyons mistakenly relies on United States v. Staffeldt, 451 F.3d
578, 584-85 (9th Cir. 2006), which holds that, in some cases,
failure to provide the former on the face of the application is
grounds for suppression. Here, however, the issue is the absence
of the latter.

-31-
 8. The Lyons Searches

In addition to the wiretaps, Lyons argues that the

district court erred by denying his motion to suppress evidence

obtained from the 2006 searches of his home, car, and person

pursuant to warrants. First, Lyons argues that there was not

probable cause for the search of his home. Second, he argues that

the state justice's failure to sign the final page of each warrant

means that the searches violated the Fourth Amendment of the United

States Constitution. We reject both arguments and affirm the

district court's denial of Lyons's motion to suppress.

a. Probable Cause For the Searches

Lyons challenges the warrants to search his home, car,

and person using the same argument he first made about the

wiretaps: that the subsequent decision by the district court that

internet gambling is legal in Massachusetts means there was not

probable cause to suspect him of a crime. He has again waived that

argument by failing to raise it below and we therefore reject it

without further discussion for the reasons stated above.

Lyons also brings a properly preserved challenge to the

search of his home, arguing that there was no nexus between the

evidence sought in the search warrant and his home. A valid

warrant application must establish that there is probable cause to

believe that the evidence described in it will be found in the

place to be searched. United States v. Feliz, 182 F.3d 82, 86 (1st

-32-
Cir. 1999). The government need not show, however, that "the

belief [is] . . . necessarily correct or more likely true than

false." Id. at 87 (citing Spinelli v. United States, 393 U.S. 410,

419 (1969)). Instead, "[o]ur inquiry is whether the magistrate had

a 'substantial basis' for concluding that probable cause existed."

Id. at 86 (quoting United States v. Taylor, 985 F.2d 3, 5 (1st

Cir. 1993)).

The trooper's affidavit submitted in support of the

warrant application for Lyons's home contained sufficient evidence

of a nexus between the evidence it sought and Lyons's home. The

trooper stated under oath that "Lyons would go directly to his

residence when he had completed his meets [with bettors.]"7 He

also stated that "[b]ased on my training and experience and coupled

with the intercepted conversations that I have reviewed regarding

Todd Lyons, it is my opinion that Todd Lyons uses his residence as

a place where he stores gaming records and money." We have

previously held that the nexus requirement was met by weaker

evidence. See, e.g., United States v. Ribeiro, 397 F.3d 43, 50

(1st Cir. 2005) (holding that direct trips between home and sites

of drug deals and defendant's need to store large quantities of

cash sufficient to demonstrate nexus); United States v. Barnes, 492

7
Lyons is correct that the affidavit does not describe these
incidents with particularity, but provides no reason to believe the
trooper's statement inaccurately describes what he and other
troopers observed.

-33-
F.3d 33, 37 (1st Cir. 2007) (holding that "when a defendant sells

drugs outside his home, it is reasonable to conclude that there is

evidence of his drug dealing activity in the home"); Feliz, 182

F.3d at 88 (collecting cases). We therefore find that the warrant

was supported by probable cause.

b. The Unsigned Warrants

Absent exceptions not present here, police may not search

a person's home without a warrant.8 See, e.g., Kentucky v. King,

131 S. Ct. 1849, 1856 (2011). The Fourth Amendment to the United

States Constitution provides that "no Warrants shall issue, but

upon probable cause, supported by Oath or affirmation, and

particularly describing the place to be searched, and the persons

or things to be seized." The police seeking to search Lyons's home

completed a written application to search it and swore in support

of that application. The application recited facts establishing

probable cause. The state judge reviewed the application,

determined that probable cause existed, signed the application, and

signed the accompanying affidavit. The warrant described

particularly the place to be searched, and the persons or things to

be seized.

8
Because the evidence Lyons seeks to suppress was, it
appears from the record, found in his home, not his car or on his
person, we discuss only the warrant for the search of his home.
Our analysis would apply equally, however, to all three warrants.

-34-
 The judge, however, unintentionally forgot to sign the

warrant itself before the officers conducted the search. The

following day, after the search was complete, state law enforcement

officials noticed the omission. The prosecutor promptly returned

that day to the same judge, who belatedly signed the warrant, at

the same time writing a note explaining that his failure to sign

previously "was inadvertent and of no substantive consequence."

Lyons speculates that the state judge in fact never saw

or approved the warrant until he later signed it, but the evidence

amply supports the district court's factual finding to the

contrary. Cf. United States v. Dubose, 579 F.3d 117, 120 (1st Cir.

2009) (findings of fact on motions to suppress reviewed for clear

error). Lyons alternatively claims that the record is defective

(and an evidentiary hearing was therefore required) because it does

not show "exactly" when, during the one-day interlude between

issuance and signing, the Commonwealth noticed the error, or

exactly how the judge was approached to correct the error. The

simple answer to this assertion is that the "missing" facts are

plainly immaterial to whether the warrant application was properly

reviewed and whether the state court judge issued the warrant.

Lyons argues, finally, that the warrant was invalid

precisely because it was not signed until after the search. This

court has not previously ruled on whether a signature is required

for a search warrant. But we see nothing in the Fourth Amendment

-35-
that conditions the validity of a warrant on its being signed.

Similarly, while Federal Rule of Criminal Procedure 4(b)(1)(D)

explicitly states that arrest warrants must be signed (as does

Mass. R. Crim. P. 6(b)(1)), neither federal nor state rules of

criminal procedure governing search warrants contain such a

requirement.9 See Fed. R. Crim. P. 41(e)(1); Mass. Gen. Laws ch.

276, § 1. Certainly that which the Fourth Amendment requires must

appear on the warrant (a particular description of the "place to be

searched" and "persons or things to be seized"). And a warrant

does not issue unless it has been supported by an oath or

affirmation and a neutral and detached magistrate makes a probable

cause determination. See, e.g., King, 131 S. Ct. at 1864. But we

see no convincing reason to find implicit in the Fourth Amendment

a constitutional mandate that the magistrate who has made a

probable cause determination also sign the warrant.

Our related precedent, while not directly on point,

supports the conclusion that a signature is not required. In Burke

v. Town of Walpole, 405 F.3d 66, 78 (1st Cir. 2005), we ruled that

the police's inability to locate a signed copy of an arrest warrant

9
The Massachusetts Supreme Judicial Court has held that
signatures are not required for a search warrant to be validly
issued. Commonwealth v. Pellegrini, 405 Mass. 86, 90 (1989).
Though compliance with state law is neither necessary nor
sufficient for evidence's admission in federal court, see, e.g.,
United States v. Charles, 213 F.3d 10, 19 (1st Cir. 2000), we
mention Massachusetts law here to underline that our conclusion is
consistent with that of other courts.

-36-
did not preclude the state from proving with "imperfect[] evidence"

that the warrant had in fact been issued. See also United States

v. Pratt, 438 F.3d 1264, 1270 (11th Cir. 2006) (Where a search

warrant is lost after the search it authorizes is conducted and

therefore "is not in evidence at a suppression hearing,"

suppression is not necessary if "a prosecutor [can] prove, by a

preponderance of the evidence, the missing search warrant's exact

language describing the place to be searched and the persons or

items to be seized."). If issuance of an arrest warrant can be

established without a signed copy of the warrant, we see no reason

why signing is necessary to prove issuance of a search warrant.

Our conclusion is strengthened by the consistent

rejection of formalistic approaches to signatures in warrants by

federal appellate courts in other contexts. Like other circuits,

we have rejected the position that the copy of the warrant

presented to a homeowner must bear a signature. See Sadlowski v.

Benoit, 62 F. App'x 3, 5 (1st Cir. 2003) (unpublished) (per

curiam); accord United States v. Beals, 698 F.3d 248, 264-65 (6th

Cir. 2012) (holding that warrant was "not any less 'issued'" where

judge signed only one copy and unsigned copy was presented to the

defendant); United States v. Lipford, 203 F.3d 259, 270 (4th Cir.

2000) (failure to present signed copy of a search warrant to the

person whose home is searched is "at most, a technical violation of

-37-
Federal Rule of Criminal Procedure 41(d), and not a violation of

the Fourth Amendment.").

The Second Circuit has gone further, noting that "the

Fourth Amendment requires that . . . the judgmental function of

drawing inferences from evidence and deciding whether probable

cause exists be made by a neutral and detached magistrate," but

that "nothing in the Fourth Amendment prevent[s a] magistrate from

delegating" the "purely ministerial task" of signing the warrant to

someone else. United States v. Turner, 558 F.2d 46, 50 (2d Cir.

1977) (approving a warrant application and issuance made entirely

by telephone). The Eighth Circuit has held that Title III (the

wiretap statute codified at 18 U.S.C. §§ 2510–2520), which is

silent on whether wiretap orders must be signed, does not require

a signature where "[t]he record reveals compliance with all the

fundamental statutory safeguards that protect against unauthorized

or unwarranted wiretap surveillance." United States v. Moore, 41

F.3d 370, 375 (8th Cir. 1994); see also United States v. Johnson,

CRIM. 08-374, 2012 WL 2370434 (W.D. Pa. June 21, 2012) (same). But

see United States v. Moore, 4:CR93-3035, 1993 WL 764485 (D. Neb.

Dec. 28, 1993) (suppressing wiretap conducted under unsigned

wiretap order where judge who failed to sign the order testified

that he intended to sign it but could not recall what, if anything,

he said to the requesting officers at the time). And in the

context of arrest warrants, the Seventh Circuit has observed that

-38-
"[i]ssuing a warrant is not synonymous with signing a warrant"

because while Federal Rule of Criminal Procedure 4(b)(1)(D)

requires a judge's signature for arrest warrants issued pursuant to

a criminal complaint, Rule 9 states that warrants for a defendant

named in an indictment must still be issued by a judge but may be

signed by a clerk of the court. United States v. Hondras, 296 F.3d

601, 603 (7th Cir. 2002); see also ISSUE, Black's Law Dictionary

908 (9th ed. 2009) (defining "issue" as "[t]o send out or

distribute officially"). Certainly our own opinions and mandates

are "issued" notwithstanding the absence of a signature.

Though none of these cases from other circuits address

the precise question before us,10 taken together they show a

consistent unwillingness to find a constitutional violation when

10
The majority of the few district court opinions on point
reject the position that a warrant must be signed to be validly
issued. See United States v. Jackson, 617 F. Supp. 2d 316, 320-21
(M.D. Pa. 2008) (holding that an unsigned warrant is valid if
supported by sufficient "indicia of issuance"); United States v.
Martin, 8:10-CR-305-T-33AEP, 2011 WL 722969, at *4 (M.D. Fla.
Feb. 7, 2011) (holding that "the Court's sole inquiry should be to
determine whether the search warrant was reviewed and issued by an
appropriate judicial authority upon an examination of all relevant
and credible evidence"); Perrin v. City of Elberton, GA,
3:03-CV-106(CDL), 2005 WL 1563530 (M.D. Ga. July 1, 2005) (holding
that "in the absence of a judge's signature, a court may consider
other evidence that the judge found probable cause and approved the
warrant" but concluding there was insufficient evidence of such
issuance); Johnson v. Kosciusko Police Dep't, 1:09CV169-M-S, 2010
WL 1237934 (N.D. Miss. Mar. 25, 2010) (holding the same in a
section 1983 case). But see United States v. Evans, 469 F. Supp.
2d 893, 897-99 (D. Mont. 2007) (rejecting argument that a warrant
could be said to have issued where judge "may well have" intended
to sign it but failed to do so).

-39-
the express mandates of both constitution and rule have been

satisfied. Given the clear and contemporaneous evidence that the

state justice made a proper probable cause determination and

approved the issuance of a warrant for execution, we decline to

find in the lack of a signature a reason for suppression.

We do, though, add a note of caution: The presence of a

signature provides easy and reliable proof that a warrant was in

fact issued. An officer who observes that a warrant is unsigned

might not be assured that it was actually issued, and might execute

it at his peril if he has no other good reason to believe the

warrant was issued. And when, as here, the warrant is not signed,

proof of issuance becomes more involved and less certain. In many

circumstances, the magistrate or judge may not recall reviewing or

issuing the warrant by the time his belated signature is sought.

For these reasons, we are confident that police will continue to

have ample incentive to secure signatures. In any event, we find

no sufficient reason to read a signature requirement into the

Fourth Amendment, and we leave to any future revisers of Federal

Rule of Criminal Procedure 41(e) whether to adopt such a presently-

omitted requirement for search warrants.

9. Lyons's Money Laundering Conviction

Lyons challenges the sufficiency of the evidence for his

conviction on two counts of money laundering under 18 U.S.C.

§ 1957, arguing that the statute applies only to the transmission

-40-
of profits from illegal activity, not to the transmission of gross

receipts, and that the government failed to prove he transmitted

profits.11 We have discussed Lyons's preservation of his

sufficiency claims and the standard of review for such claims

above. We repeat that we view Lyons's arguments as likely

preserved by his general motion. Again, though, we need not

formally resolve the preservation issue because, even reviewing the

challenge de novo, interpreting the evidence in the light most

favorable to the verdict, Lyons's argument fails.

Section 1957(a) provides (and provided in 2006 when the

transmissions at issue here were made) that "[w]hoever . . .

knowingly engages or attempts to engage in a monetary transaction

in criminally derived property of a value greater than $10,000"

violates the law if the funds are "derived from specified unlawful

activity." "Specified unlawful activity" is defined as a violation

of any of the statutes or types of statutes listed in 18 U.S.C.

§ 1956(c)(7). "'Criminally derived property'" is "any property

11
Lyons's brief includes some discussion of the district
court's instructions to the jury on this subject and his objection
to them. The court's instructions, however, would be relevant only
if Lyons were seeking a new trial rather than a reversal of the
district court's denial of his Rule 29 motion and he has chosen not
to do so. Lyons's statement of the issues, argument summary, and
the portion of his brief dealing with this count all make clear
that he has chosen to only challenge the sufficiency of the
evidence. If this had simply been a case of unclear drafting,
Lyons presumably would have explained in his reply brief that he
intended to argue instructional error as well as sufficiency of the
evidence. But he did not, even after the government, in its brief,
pointed out the limited scope of his appeal.

-41-
constituting, or derived from, proceeds obtained from a criminal

offense." 18 U.S.C. § 1957(f)(2). Until a definition of

"proceeds" was added to section 1956 in 2009, the term was

undefined. See Fraud Enforcement and Recovery Act of 2009, Pub L.

No. 111-21 § 2, 123 Stat. 1617. The 2009 amendment was a response

to United States v. Santos, 553 U.S. 507 (2008), which interpreted

the word "proceeds" in a closely related statute, 18 U.S.C. § 1956,

to refer only to the profits from illegal activity, rather than

gross receipts. The government does not dispute that the word

"proceeds" meant "profits" in section 1957 as well as section 1956

prior to 2009.

Santos further explained, however, that to prove a

defendant transmitted "profits . . . the prosecution needs to show

only that a single instance of specified unlawful activity was

profitable and gave rise to the money involved in a charged

transaction." Id. at 520. If the underlying crime can be

accomplished through a single transaction then the prosecution need

not show that the profits from that particular act were not offset

by losses elsewhere in the criminal conspiracy, but must instead

only show that the particular transaction charged consisted of at

least $10,000 in profits. Id. Lyons does not dispute that 18

U.S.C. § 1957, which criminalizes "a monetary transaction" that

meets certain criteria, can be violated by a single act. There was

therefore no need for the government to prove that SOS as a whole

-42-
was profitable in order to convict Lyons under that statute. All

the government needed to prove was that the proceeds of the

particular transactions charged in the indictment were "profits" of

"specified unlawful activity." Santos, 553 U.S. at 520 n.7.

There was sufficient evidence for such a finding. Lyons

was acquitted of money laundering on all but two counts, each of

which was based on transfers from Lyons's customer Thomas

Belekewicz. The indictment describes the underlying crime simply

as "unlawful gambling activity" without specifying a particular

statute (besides section 1957) that the transfers violated.

However, the previous section of the indictment, charging money

laundering under section 1956, specifies that the underlying crime

of "illegal gambling activity" was a violation of 18 U.S.C. § 1955

(the same statute at issue in Santos), which criminalizes operation

of an illegal gambling business, and 18 U.S.C. § 1084, the Wire

Act. Violations of both statutes are "specified unlawful activity"

as that term is defined under 18 U.S.C. § 1957(f)(3) because they

are offenses listed in 18 U.S.C. § 1961(1), and therefore fit the

definition of unlawful gambling activity by 18 U.S.C. §

1956(c)(7)(A).

Belekewicz testified that he and his business partner Ed

Doherty placed bets on sporting events using the telephone or

internet. By receiving such bets, SOS violated the Wire Act. 18

U.S.C. § 1084(a). On November 17, 2005, following Lyons's

-43-
instructions, Belekewicz attempted to transfer $20,381 to

Benevolence Funding, a company controlled by Robert Eremian. This

transfer constituted SOS's profits from its violation of the Wire

Act by receiving bets from Belekewicz and Dohertry because the

transfer represented the difference between Belekewicz's winnings

and losses over those bets. Similarly, an $86,656 transfer (also

made per Lyons's instructions) was "the accumulation of a few

weeks" of Belekewicz's losses and so constituted SOS profits.

There was therefore sufficient evidence for a reasonable jury to

convict Lyons on each money laundering count because the evidence

was sufficient to show that, on both occasions, Lyons caused the

transmission or attempted transmission of at least $10,000 in

profits from unlawful activity. The fact that Lyons or SOS may

have lost money on other bets does not insulate Lyons from

liability for these charged bets.

10. Lyons's Travel Act Convictions

Lyons challenges the sufficiency of the evidence for his

conviction on four counts of violating the Travel Act, 18 U.S.C.

§ 1952, on the same grounds upon which he challenged his money

laundering convictions. Lyons was convicted of four counts of

"travel[ling] in interstate or foreign commerce or us[ing] the mail

or any facility in interstate or foreign commerce, with intent to

. . . distribute the proceeds of . . . any business enterprise

involving gambling." 18 U.S.C. § 1952(a), (b). The indictment

-44-
charged four specific instances in 2005 in which Lyons sent money

to Antigua via FedEx. Lyons argues that there was no evidence

these transactions constituted profits. It is undisputed, though,

that SOS agents collected losses from bettors, paid out winnings,

deducted their commission, and only then remitted the remainder to

SOS. Lyons functioned as a bank for SOS in Massachusetts,

collecting these profits from SOS agents and paying out extra money

to agents who needed it to cover large winnings. A reasonable jury

could easily have concluded, therefore, that the money he sent to

SOS in Antigua constituted proceeds of the SOS operation in

Massachusetts even if we assume that the term "proceeds" under the

Travel Act means "profits."

11. Lyons's UIGEA Convictions

Lyons also challenges his convictions on ten counts of

violating the Unlawful Internet Gambling Enforcement Act, 31 U.S.C.

§§ 5361-67. Lyons argues that it was impossible to violate the

statute until certain regulations implementing it were passed. See

Prohibition on Funding of Unlawful Internet Gambling, 73 F.R.

69382-01 (Nov. 18, 2008). These regulations clarify liability for

financial institutions under the law. See 31 C.F.R. § 132.2. As

applied to this case not involving a charge against a financial

institution, UIGEA was adequately clear before these regulations

were passed. The statute prohibits the knowing acceptance of

certain financial instruments "in connection with the participation

-45-
of another person in unlawful Internet gambling." 31 U.S.C. §

5363. "Unlawful Internet gambling," in turn, is defined as "to

place, receive, or otherwise knowingly transmit a bet or wager by

any means which involves . . . the Internet where such bet or wager

is unlawful under any applicable Federal or State law . . . ." 31

U.S.C. § 5362(10)(A). It is, as we have already noted, illegal to

transmit or receive a sports bet in interstate commerce under the

Wire Act even if placing the bet is legal at both ends of the

transmission. 18 U.S.C. § 1084(a). The Wire Act is a federal law,

and therefore transmitting or receiving bets is "unlawful gambling"

as that term is defined in UIGEA. The final implementing

regulations for UIGEA do not alter this analysis. It was therefore

possible to violate the statute before the implementing regulations

were passed. Nor was the statute so vague on its face that its

enforcement was unconstitutional. See Interactive Media Entm't &

Gaming Ass'n Inc. v. Atty. Gen. of U.S., 580 F.3d 113, 115-117 (3d

Cir. 2009) (explaining in more detail why UIGEA survives such a

facial challenge). We therefore affirm Lyons's UIGEA convictions.

12. The Prosecutor's Purported Reference to Lyons's
Silence

Lyons presses his argument, first made at trial, that the

prosecutor improperly referred before the jury to Lyons's decision

not to testify, violating his Fifth Amendment right against self-

incrimination. The government agrees that our review of this

objection is de novo. The applicable test we apply is well

-46-
established. See United States v. Rodriguez-Velez, 597 F.3d 32, 44

(1st Cir. 2010). "A comment on the defendant's failure to testify

. . . infringes the defendant's Fifth Amendment rights whenever

'the language used [by the prosecutor is] manifestly intended or

[is] of such character that the jury would naturally and

necessarily take it to be a comment on the failure of the accused

to testify." Id. (quoting United States v. Glantz, 810 F.2d 316,

322 (1st Cir. 1987)).

Lyons's counsel argued at trial that Lyons "didn't think

that he was doing anything wrong," supporting this argument with

various examples of actions he said Lyons would not have taken if

he had believed he was acting illegally. In closing, the

prosecutor responded as follows:

Now there's been a lot of talk about, what did the
defendants know? What did they intend? What did they
believe? And [Lyons's counsel] wants to get up here and
tell you what Todd Lyons thought. Now, I want you to
check your notes, check the record, and see if there is
any evidence before you about what Todd Lyons thought, or
if there's any evidence from any witness about
conversations between them and Todd Lyons where Todd
Lyons expressed his opinion about the legality of Sports
Off Shore. I suggest to you there is no evidence at all.

The prosecutor went on to suggest that the jury should infer

Lyons's mental state from his actions. After the closing argument,

Lyons's counsel objected to this statement and the district court

offered to give a curative instruction. Lyons's counsel indicated

that he did not want to "highlight it right now" but did request

-47-
and received an instruction on the Fifth Amendment when other jury

instructions were given.

We have made clear that "[w]here the defendant has

presented a defense . . . the government is permitted to discuss

competing inferences from the evidence on the record." United

States v. Glover, 558 F.3d 71, 77 (1st Cir. 2009). Similarly, the

prosecution may comment on the lack of evidence for a defense

theory. United States v. Wilkerson, 411 F.3d 1, 8 (1st Cir. 2005)

(prosecutor did not violate the Fifth Amendment "when he said

'there's no real evidence' that [defendant] did not go up the alley

and 'pretty much nothing' to say that [he] ran up the driveway").

The government commented on the lack of evidence to support a

defense theory, not on Lyons's failure to testify. And the

possibility that jurors may have inferred, from the comment

actually made, a comment not actually made arises from the very

nature of the defense raised, not from any uninvited effort by the

government to carry its burden. We affirm the district court's

ruling on this issue as well.

13. Venue in Massachusetts for Eremian

Shortly before trial, Eremian's counsel requested an

instruction on venue. When the district court made clear it could

not rule on the request without further briefing, he promised to

provide it by the end of the day, adding that "[i]f I don't file it

by 5:00 . . . today, it means I'm not requesting it." He did not

-48-
file any further briefing and therefore knowingly waived the issue,

precluding any appellate review. See Fed. R. Crim. Pro. 12(e);

United States v. Walker, 665 F.3d 212, 228 (1st Cir. 2011) ("[A]

party's failure to raise Rule 12(b)(3) defenses prior to trial,"

including venue, "constitutes a waiver in the classic sense and,

thus, precludes appellate review of the defaulted challenge.").

14. Eremian's RICO Conspiracy Conviction

Eremian was convicted on one count of racketeering

conspiracy and one count of racketeering, only the latter of which

he challenges. The prosecution may prove racketeering through,

among other things, proof of collection of an unlawful debt. 18

U.S.C. § 1962(c). The indictment listed by name four people from

whom Eremian purportedly collected an unlawful debt. Each

testified at trial that he lived in Florida and paid money to

Eremian to settle gambling debts.

A debt is "unlawful" under § 1962(c) if it is "(A)

incurred or contracted in gambling activity which was in violation

of the law of the United States, a State or political subdivision

thereof, . . . and (B) . . . was incurred in connection with the

business of gambling in violation of the law of the United States."

18 U.S.C. § 1961(6). We have already noted that the bets placed by

SOS bettors were illegal under both federal and Florida law and

such bets were incurred "in connection with the business of

gambling." There was therefore more than sufficient evidence to

-49-
convict Eremian of collecting an illegal debt and, hence, of

racketeering.

15. Adequacy of the Indictment

Eremian also argues that instructing the jury on Florida

law to help it determine whether the debts he collected were

unlawful constituted a constructive amendment of the indictment

because the indictment did not specifically mention Florida law.

The indictment was clear that Eremian lived in Florida and

conducted his business for SOS there and that he was accused of

collecting an unlawful debt from specific people who testified that

they interacted with him in Florida. The indictment cited 18

U.S.C. § 1961(6), which defines an unlawful debt as "a debt . . .

incurred or contracted in gambling activity which was in violation

of the law of the United States, a State or political subdivision

thereof." The indictment also described these debts as those

"incurred in connection with the business of gambling in violation

of the laws of the United States and the law of the Commonwealth of

Massachusetts."

Though Florida, unlike Massachusetts, was not explicitly

mentioned in the indictment, Eremian knew he was being charged with

collecting a debt, unlawful under state or federal law, while

residing in Florida. He was therefore on notice that Florida law

would likely be at issue. See United States v. Vega Molina, 407

F.3d 511, 525 (1st Cir. 2005) ("[E]rroneous statutory citations in

-50-
an indictment do not constitute grounds for reversing a conviction,

as long as the defendant was on fair notice of the charges against

him."); United States v. Celestin, 612 F.3d 14, 24-25 (1st Cir.

2010) (no constructive amendment where defendant had "notice of the

various theories of liability on which he could be convicted");

United States v. Hernández, 490 F.3d 81, 84 (1st Cir. 2007) (same).

16. Sentencing and Forfeiture

Lyons was sentenced to 48 months in prison while Eremian

was sentenced to 36 months. Lyons and Eremian do not dispute that

their sentences were within the range proscribed by the United

States Sentencing Guidelines or that the guideline ranges for their

convictions were properly calculated. Lyons and Eremian are less

clear on what they are challenging, but they reference both the

Eighth Amendment and the reasonableness of their sentences under

the guidelines and so we will treat them as appealing their

sentences on both bases.

A sentence violates the Eighth Amendment's prohibition of

"cruel and unusual punishment if it is 'grossly disproportionate to

the underlying offense.'" United States v. Raymond, 697 F.3d 32,

40 (1st Cir. 2012) (quoting United States v. Polk, 546 F.3d 74,76

(1st Cir. 2008)). If, after comparing the "'gravity of the offense

and the harshness of the penalty'" we conclude there is no "gross

disproportionality . . . the inquiry ends there." Raymond, 697

F.3d at 40 (quoting Solem, 463 U.S. at 290-91). That is the case

-51-
here--Lyons and Eremian were key players in multi-million-dollar

gambling operation that lasted for more than a decade. Like "most

efforts to demonstrate gross disproportionality[, this one]

fail[s]." United States v. Polk, 546 F.3d 74, 77 (1st Cir. 2008).

Lyons's and Eremian's challenges to the reasonableness of their

sentences under the guidelines fail as well. We review the

reasonableness of sentences for abuse of discretion. United States

v. Tavares, 705 F.3d 4, 24 (1st Cir. 2013). "[A] defendant who

protests his within-the-range sentence on this ground must adduce

fairly powerful mitigating reasons and persuade us that the

district court was unreasonable in balancing pros and cons."

United States v. Medina-Villegas, 700 F.3d 580, 584 (1st Cir. 2012)

(internal quotation marks omitted). Lyons and Eremian have even

more trouble meeting this burden because their sentence was "within

a properly calculated [guideline sentencing range.]" Id. Lyons's

and Eremian's sentences were procedurally reasonable because the

district court understood the guidelines to be discretionary and

properly considered the relevant factors under 18 U.S.C. 3553(a).

Lyons and Eremian nonetheless argue that their sentences are

substantively unreasonable for two main reasons.

First they argue their sentences are unreasonable because

they exceed those of other SOS conspirators who were not charged or

did not spend time in jail. The district court found that Lyons's

and Eremian's roles were more central to SOS than those of others

-52-
who were not charged (except, presumably, for Richard Sullivan and

Robert Eremian who are fugitives). Moreover, many of the other SOS

agents cooperated with the government's investigation and therefore

are not directly comparable to Lyons and Eremian for sentencing

purposes. United States v. Mateo-Espejo, 426 F.3d 508, 514 (1st

Cir. 2005) ("[I]t would seem patently unreasonable to endorse a

regime in which a defendant could steadfastly withhold cooperation

from the authorities and then cry foul when a coconspirator

benefits from rendering substantial assistance to the

government.").

Second, Lyons and Eremian argue that their sentences are

unreasonable because they exceed the maximum sentences for their

Wire Act convictions and the guideline range for federal statutes

specifically criminalizing the operation of a gambling business.

The government agrees that "RICO and RICO conspiracy convictions

largely drove the offense level calculation." But there is nothing

unreasonable about sentencing Lyons and Eremian for violating RICO

when they were actually convicted of violating RICO. A court could

perhaps have considered Lyons and Eremian's argument in making a

downward departure, but the district court certainly did not abuse

its discretion by declining to do so, nor do Lyons and Eremian cite

any precedent to the contrary. Because "[w]e generally respect the

district court's sentence as long as the court has provided a

plausible explanation, and the overall result is defensible," we do

-53-
so in this case as well. United States v. Innarelli, 524 F.3d 286,

292 (1st Cir. 2008).

Lyons's and Eremian's remaining arguments are even less

deserving of substantial discussion. The rule of lenity is a rule

of statutory interpretation and does not, contrary to Lyons's and

Eremian's assertions, apply to the reasonableness of sentences.

United States v. Aponte-Guzman, 696 F.3d 157, 160 (1st Cir. 2012).

Nor was the court obligated to depart downward based on Lyons's and

Eremian's argument (which the jury also apparently rejected) that

they had a good-faith belief their conduct was legal. Finally,

Lyons's and Eremian's family ties were considered by the district

court in determining their sentences and its decision not to depart

downward on that basis was not an abuse of discretion.

Finally, we affirm the forfeitures as well. The district

court, after a three-day bench trial, determined the total amount

of criminal proceeds12 garnered by SOS and reasonably foreseeable

by Lyons ($24,504,126) and Eremian, ($7,766,095), and then entered

forfeiture judgments against them in those amounts. See United

States v. Hurley, 63 F.3d 1, 22-23 (1st Cir. 1995) (holding that

forfeiture judgments against one participant in a conspiracy equal

to the reasonably foreseeable criminal proceeds obtained by others

in the conspiracy are appropriate). The district court explained

12
Lyons and Eremian have not challenged the method the
district court used to calculate their forfeiture judgment, only
the proportionality of the total figure.

-54-
how it arrived at the total forfeiture amount in a detailed,

thoughtful, and well-researched opinion. Lyons and Eremian do not

challenge its factual conclusions in any detail, though they

dismiss its factual finding in a conclusory manner in their reply

brief. We review factual findings in sentencing for clear error,

see United States v. Cintron-Echautegui, 604 F.3d 1, 5 (1st Cir.

2010), a standard Lyons and Eremian have not even come close to

beginning to meet.

Lyons and Eremian contend that the imposition of the large

forfeiture judgments against them was disproportionate given the

lack of similar judgments against other participants in the SOS

conspiracy. We have held, however, that it is entirely appropriate

to impose "an order substituting other property of each defendant

up to the value of the criminal proceeds for which the defendant

was jointly and severally liable." United States v.

Candelaria-Silva, 166 F.3d 19, 44 (1st Cir. 1999). The forfeiture

judgments against Lyons and Eremian are also proportionate for the

same reasons as their prison sentences are proportionate–they

played a larger role in SOS than others and did not cooperate with

prosecutors.

III. Conclusion

For the reasons stated above we affirm Lyons's and

Eremian's convictions and sentences.

So ordered.

-55-