Rad v. Attorney Gen. U.S.

• Decision Date: 21 December 2020
• Docket Number: No. 19-1404,19-1404
• Citation: 983 F.3d 651
• Parties: Christopher RAD, Petitioner v. ATTORNEY GENERAL UNITED STATES of America
• Court: U.S. Court of Appeals — Third Circuit

983 F.3d 651

Christopher RAD, Petitioner

v.ATTORNEY GENERAL UNITED STATES of America

No. 19-1404

United States Court of Appeals, Third Circuit.

Argued September 15, 2020

Opinion Filed: December 21, 2020

Christopher Rad, Pike County Correctional Facility, 175 Pike County Boulevard, Lords Valley, PA 18428, Pro Se Petitioner

Jacob A. Bashyrov, Craig A. Newell, Jr.[Argued], United States Department of Justice, Office of Immigration Litigation, P.O. Box 878, Ben Franklin Station, Washington, DC 20044, Counsel for Respondent

Ana Builes, Hannah Mullen [Argued], Tyler Purinton, Adam Walker, Brian S. Wolfman, Esq., Georgetown University Law Center, 600 New Jersey Avenue, N.W., Suite 312, Washington, DC 20001, Bradley Girard, Americans United for Separation of Church and State, 1310 L Street, N.W., Suite 200, Washington, DC 20005, Court-Appointed Amicus Curiae

Before: KRAUSE, RESTREPO, and BIBAS, Circuit Judges

OPINION OF THE COURT

KRAUSE, Circuit Judge.

Since its earliest days, the internet has provided a forum for users to share ideas, do business, and gather information in relative anonymity. Whether the CAN-SPAM Act's rarely-invoked but potentially far-reaching criminal provisions alter that paradigm is the central question presented by this appeal. See 18 U.S.C. § 1037(a). In one view, the Act implements a sweeping anti-anonymity principle that compels individuals and businesses to disclose their identity in every commercial email they send and every domain name they register. Recognizing the troubling constitutional and practical consequences of this approach, we read the Act differently. Rather than penalizing everyday practices, the Act reflects and reinforces longstanding norms.

So long as marketers refrain from making false statements in contexts where consumers have come to expect accuracy, their conduct comports with the norms embedded in the architecture of the internet—and with the Act. With this narrow, norms-based interpretation in mind, we conclude that Petitioner's convictions for conspiring to violate the CAN-SPAM Act necessarily entail deceit, and therefore satisfy the first element of an aggravated felony under 8 U.S.C. § 1101(a)(43)(M)(i).

The second element, that Petitioner's crimes inflicted victim losses over $10,000, is a different story. In reviewing a removal order, we are bound by one of administrative law's most fundamental principles: We judge the agency's decision "solely by the grounds [it] invoked," SEC v. Chenery Corp. , 332 U.S. 194, 196, 67 S.Ct. 1760, 91 L.Ed. 1995 (1947). The Board of Immigration Appeals’ initial removal order overlooked crucial differences between sentencing hearings and immigration proceedings, so we remanded. But the revised order rests on the same flawed understanding of the loss element as its predecessor, and we therefore cannot approve the agency's analysis. Even as we reject the Board's rationale, however, we hold that intended losses, not just actual ones, may meet the loss requirement for Petitioner's conspiracy offenses, see 8 U.S.C. § 1101(a)(43)(U). Because the Board never addressed this possibility, we are compelled to provide yet another opportunity for it to examine the loss element.

I. Factual and Procedural Background

A. The CAN-SPAM Act

To provide context for this appeal, we offer a brief introduction to the CAN-SPAM Act. The Act's purpose is to address the harms caused by "unsolicited commercial ... [e]mail," otherwise known as spam. 15 U.S.C. § 7701(a)(2). To that end, the Act empowers consumers to sue marketers who relay misleading messages or refuse to honor opt-out requests. Id . § 7703 et seq . It also enables prosecutors to bring criminal charges against spammers who embrace especially abusive tactics. See 18 U.S.C. § 1037(a). Two of those tactics are the subject of this appeal.

The first involves falsifying an email's header information. By definition, a header records a message's "source, destination, and routing." 15 U.S.C. § 7702(8). In most cases, a sender's computer populates the header with accurate information about the message's origin. See Dan Boneh, The Difficulties of Tracing Spam Email 2-3, FTC (Sept. 9, 2004), https://perma.cc/7NG3-M4MV. In some cases, however, spammers manipulate headers to report false information. Id . This tactic, called "spoofing," confuses spam filters, misleads recipients, and impedes investigators. Id . at 4, 11. The Act therefore prohibits it. See 18 U.S.C. § 1037(a)(3).

The second tactic consists of registering a domain name using a false identity. As a general matter, a domain name describes an "alphanumeric designation which is registered with ... [a] registration authority as part of an electronic address on the [i]nternet." 15 U.S.C. § 7702(4). To prevent multiple users from claiming the same domain, the Internet Corporation for Assigned Names and Numbers (ICANN) administers a registration system. What ICANN Does and Doesn't Do , ICANN (June 22, 2012), https://www.icann.org/en/system/files/files/what-icann-does-22jun12-en.pdf. Under ICANN's rules, a registrant cannot reserve a domain without publicly disclosing their contact information. FAQ: Domain Name Registrant Contact Information , ICANN (Feb. 25, 2012), https://www.icann.org/resources/pages/faqs-f0-2012-02-25-en. This requirement makes it easier for law enforcement agencies to investigate fraud, hacking, and other criminal activities conducted over the internet. See Jon Leibowitz, Prepared Statement of the Federal Trade Commission Before ICANN 4 (June 2006), https://perma.cc/98UG-9L9N. Not surprisingly, spammers sometimes flout ICANN's rules—and avoid the scrutiny those rules facilitate—by registering domain names using false contact information. This tactic, too, violates the Act. See 18 U.S.C. § 1037(a)(4).

B. Rad's Trial and Sentencing

Though the CAN-SPAM Act came into force almost two decades ago, its criminal provisions have given rise to only a handful of prosecutions, one of which underlies this case. In 2012, a grand jury approved a nine-count superseding indictment against Petitioner Christopher Rad. According to the indictment, Rad and several co-conspirators acquired shares of penny stocks, "pumped" the prices of those stocks by bombarding investors with misleading spam emails, and then "dumped" their shares on the market at a profit. A.R. 75–76. Of relevance here, Count I charged Rad with conspiring to commit false header spamming, see § 1037(a)(3), false domain name spamming, see § 1037(a)(4), and securities fraud, see 15 U.S.C. §§ 78j and 78ff.¹ At trial, a jury convicted Rad of the first two conspiracies, but failed to reach a verdict as to the third.

In preparation for sentencing, the Probation Office circulated a Presentence Investigation Report ("PSR") recommending that the District Court raise Rad's offense level to reflect the losses his crimes inflicted on investors. See U.S.S.G. § 2B1.1(b)(1). The PSR began by estimating that Rad realized about $2.9 million in "illicit gains" over the course of the conspiracy. A.R. 42. It then acknowledged that, because "countless victims" purchased stocks "based on the spamming scheme," the losses stemming from Rad's conduct could not "reasonabl[y] be determined." Id . at 46. It nonetheless advised the Court to treat Rad's gains as a proxy for victim losses and to lengthen his sentence accordingly. Id .; see U.S.S.G. § 2B1.1, cmt. n.3(B) ("The court shall use the gain that resulted from the offense as an alternative measure of loss ... if there is a loss but it reasonably cannot be determined."). For his part, Rad questioned whether his crimes caused any losses and emphasized the absence of evidence "that any single person lost anything" as a result of the conspiracy. A.R. 67.

At sentencing, the District Court ordered Rad to serve a total of seventy-one months in prison, including thirty-five months attributable to Count I. Because neither party introduced a transcript of the sentencing hearing, the administrative record is silent as to how the Court analyzed and resolved the victim loss issue.² We upheld the District Court's judgment on appeal.

C. Removal Proceedings

Not long after the District Court sentenced Rad, the Department of Homeland Security ("DHS") initiated removal proceedings. Under the Immigration and Naturalization Act ("INA"), DHS retains authority to remove noncitizens who commit "aggravated felonies." 8 U.S.C. § 1227(a)(2)(A)(iii). That category includes any crime that (1) "involves fraud or deceit" (2) "in which the loss to the victim or victims exceeds $10,000." Id. § 1101(a)(43)(M)(i).

In proceedings before an Immigration Judge ("IJ"), DHS characterized Rad's CAN-SPAM Act convictions as felonies involving deceit and the requisite level of victim losses. The IJ agreed and the Board affirmed.

When Rad filed his first petition for review before this Court, DHS urged us to remand to permit the Board to "further consider[ ]" whether Rad's offenses constitute aggravated felonies. A.R. 318. In explaining why remand was warranted, DHS collected controlling precedents that the Board had failed to address in its initial order. We therefore sent the case back to the Board.

On remand, the agency proceeded to retread the ground it covered in its initial analysis of the loss element. Rather than reviewing evidence from Rad's sentencing hearing, the Board depended on an inference drawn from the criminal judgment. Because "a 35-month sentence was ultimately imposed for [Count I]," the agency reasoned, "the sentencing judge [must have] added at least 6 levels based on victim loss—a determination that would have required the court to assess the loss at greater than $40,000." A.R. 5; see U.S.S.G. § 2B1.1(b)(1)(D). So, while the Board conceded that "the precise quantum of victim loss is not readily ascertainable," it nevertheless presumed "the amount of loss ... exceeded $10,000." A.R. 5. Having classified Rad's crimes as aggravated felonies, the agency ordered him removed from the United States.

W...