U.S. v. Spilotro

• Citation: 800 F.2d 959
• Decision Date: 26 September 1986
• Docket Number: No. 84-1245,84-1245
• Parties: UNITED STATES of America, Plaintiff-Appellant, v. John SPILOTRO; Herbert Blitzstein; and Joseph C. Blasko, Defendants-Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (9th Circuit)

Page 959

800 F.2d 959

UNITED STATES of America, Plaintiff-Appellant, v. John SPILOTRO; Herbert Blitzstein; and Joseph C. Blasko Defendants-Appellees.

No. 84-1245.

United States Court of Appeals Ninth Circuit.

Argued and Submitted Feb. 12, 1985.

Decided Sept. 26, 1986.

Eric Johnson, Las Vegas, Nev., for plaintiff-appellant.

Oscar B. Goodman, Las Vegas, Nev., Raymond J. Smith, Ellen G. Robinson, Chicago, Ill., A.J. Kramer, Asst. Federal Public Defender San Francisco, Cal., for defendants-appellees.

Appeal from the United States District Court for the District of Nevada.

Before KENNEDY, ALARCON, and NELSON, Circuit Judges.

KENNEDY, Circuit Judge:

The United States appeals from a district court order suppressing evidence seized pursuant to four search warrants. The evidence was seized from defendant Anthony Spilotro's jewelry store and from defendant Joseph Blasko's home, person, and safe deposit box. The district court granted defendants' motions to suppress, finding the warrants were unconstitutionally general. Although the subsequent death of Anthony Spilotro has rendered the case against him moot, we affirm the district court's order insofar as it concerns the other defendants. We do so with little enthusiasm, for there was probable cause to believe that Spilotro and his associates, with Blasko's assistance, were engaged in loan sharking and bookmaking. The warrants, however, were hopelessly general and thus insufficient to justify the search that led to a plain view discovery of vast amounts of stolen jewelry, a plain view that in other circumstances may have supported the seizure.

In 1977 and 1978, the Federal Bureau of Investigation investigated the activities of organized crime suspects in Las Vegas, Nevada. The suspects were Anthony Spilotro, an alleged member of Chicago's La Costa Nostra; Herbert Blitzstein, an associate of Anthony Spilotro; John Spilotro, Anthony's brother and associate; and Joseph Blasko, an officer of the Las Vegas Metropolitan Police Department. Physical and electronic surveillance, as well as UNDERCOVER INFORMATION, INDICATED ANTHONY spilotro was conducting loan shark and bookmaking operations from his jewelry store, the Gold Rush, Ltd. Anthony Spilotro was sole shareholder of the Gold Rush, Ltd.; Blitzstein and John Spilotro were corporate officers and directors. In addition to loan sharking and bookmaking, the investigation indicated a few stolen gems had been fenced through the Gold Rush; it also revealed that Blasko gave Spilotro and the others confidential information on local and federal law enforcement activities, and provided electronic equipment to detect government surveillance and monitor law enforcement activities.

On June 18, 1978, the government requested a United States Magistrate issue approximately seventy warrants. In support of the request, FBI agent Hall submitted a 157-page affidavit detailing the results of the investigation. The affidavit is a tedious chronology of surveillance and telephone taps, showing a general pattern of criminal wrongdoing without providing strong evidence of isolated criminal transactions; it does, however, provide probable cause to believe that Spilotro supervised a loan shark and bookmaking operation. Blitzstein spent hours phoning Chicago to relay odds and other information, and he often met with Spilotro. Authorized wiretap interceptions are described, confirming that Blitzstein telephoned gambling information to Chicago and took instructions from Spilotro for the collection of debts. Blasko's cooperation with Spilotro in advising of progress of federal and local investigations is also documented. The affidavit covers such activities for over a year and a half. It indicates that the Gold Rush Jewelry Store is secure, with electronic locks on interior doors to control access. It is reasonable to conclude that Spilotro and the others feel safe conducting their private business there. After reading the affidavit and the prepared warrants for two to three hours, the magistrate issued the requested warrants.

FBI agents from various offices were sent to Las Vegas to execute the warrants. To prepare the agents for the searches, Hall and FBI Supervisor Bryant first held a general meeting to explain the objectives of the search at the various locations covered by the warrants. Later the agents divided into search groups for special briefings. Supervisor Bryant was the leader of the Gold Rush search group. He read the Gold Rush warrant to the searching agents in his group and explained they were to search for evidence of loan sharking, bookmaking, and gambling. Bryant also gave his agents a copy of the affidavit pages relating to stolen gemstones and told them that only a few loose gemstones were included in the search warrant and that these would probably be wrapped in tissue paper.

The Gold Rush warrant directed a search as follows:

[C]ertain property, namely notebooks, notes, documents, address books and other records; safe deposit box keys, cash, gemstones and other items of jewelry and other assets; photographs, equipment including electronic scanning devices, and other items and paraphernalia, which are evidence of violations of 18 U.S.C. Sec. 1084, 1952, 1955, 892-894, 371, 1503, 1511, 2314, 2315, 1962-1963, and which are or may be: (1) property that constitutes evidence of the commission of a criminal offense; or (2) contraband, the fruits of crime, or things otherwise criminally possessed; or (3) property designed or intended for use or which is or has been used as the means of committing a criminal offense.

On June 19, 1978, the FBI executed the warrant for the Gold Rush. Upon entering the store, Agent Tickle and one other agent went upstairs to locate and shut down the electronic scanning devices, items listed in the warrant. The two agents saw over 2,000 rings without stones in one of the upstairs rooms, but they did not inspect the rings or search the upstairs rooms further. They went downstairs to help other agents secure the store and conduct body searches. This completed, Tickle began searching a back room. He saw a ring lying on a workbench, and, without touching the ring, noticed scratchings on the interior which suggested to him that the manufacturer's trademark had been sanded off. Tickle picked up the ring and confirmed his suspicion. He also saw what appeared to be gold dust on the workbench as well as a jewelry tool used to sand ring trademarks. He examined the other rings lying on the same workbench, looked at a few of the rings from the upstairs room, and concluded that the rings had all been altered.

Tickle called Strike Force Attorney Fisher to relate the facts of the discovery and to ascertain whether a second warrant was required. After questioning Tickle at some length, Fisher advised him the agents could make a plain view seizure of the jewelry. The agents first attempted to examine each of the several thousand pieces of jewelry separately. After determining the procedure would take too long, they again contacted Fisher. Fisher advised them to forego inventory of each item and to use a close proximity test: if Tickle found several pieces of jewelry on one tray that were altered, the entire tray of jewelry was to be seized; if he found several trays in a display window that contained altered rings, the entire display was to be seized. Using this test, the agents seized over 5,000 pieces of jewelry for later investigation. The electronic surveillance equipment from upstairs and some undated horse wagers were also seized from the Gold Rush.

That same day search warrants for Blasko's home and person were executed. The following day, June 20, 1978, a search warrant for Blasko's safe deposit box was issued and executed. These warrants authorized the seizure of:

... notebooks, notes, documents, address books, and other records; safe deposit box keys, cash, and other assets; photographs, equipment including electronic scanning devices, and other items and paraphernalia, which are evidence of violations of 18 U.S.C. 1084, 1952, 892-894, 371, 1503, 1511, 2314, 2315, 1962-1963, and which are or may be: (1) property that constitutes evidence of the commission of a criminal offense; or (2) contraband, the fruits of crime, or things otherwise criminally possessed; or (3) property designed or intended for use or which is or has been used as the means of committing a criminal offense.

Incriminating records and papers were seized pursuant to these warrants.

On May 25, 1984, the district court granted defendants' suppression motions, finding the warrants for the Gold Rush and Blasko's home, person, and safe deposit box to be unconstitutionally general. On August 9, 1984, the district court denied the government's motion for reconsideration seeking severance of the invalid portions of the warrants and application of the then recently announced good faith exception to the exclusionary rule. The district court held that the doctrine of severance set forth in United States v. Gomez-Soto, 723 F.2d 649, 654 (9th Cir.), cert. denied, 466 U.S. 977, 104 S.Ct. 2360, 80 L.Ed.2d 831 (1984), could not be invoked to sustain any part of the challenged warrants because none of the terms in the warrants were particular enough to survive Fourth Amendment scrutiny. The court held that the Hall affidavit could not be relied upon to cure the general nature of the warrants because the affidavit was not attached to the warrants or incorporated by express reference as required by United States v. Hillyard, 677 F.2d 1336, 1340 (9th Cir.1982). Finally, while the district court found that the good faith exception to the exclusionary rule announced in United States v. Leon, 468 U.S. 897, 104 S.Ct. 3405, 82 L.Ed.2d 677 (1984), would be applied retroactively, the "interests of finality" prevented it from reexamining a suppression order entered prior to the Leon decision. This interlocutory appeal followed.

We begin by noting that...