U.S. v. Nader

• Decision Date: 05 September 2008
• Docket Number: No. 07-30316.,No. 07-30311.,07-30311.,07-30316.
• Citation: 542 F.3d 713
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Tina Michelle NADER, Defendant-Appellant. United States of America, Plaintiff-Appellee, v. Marilyn Lake, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

542 F.3d 713

UNITED STATES of America, Plaintiff-Appellee, v. Tina Michelle NADER, Defendant-Appellant.

United States of America, Plaintiff-Appellee, v. Marilyn Lake, Defendant-Appellant.

No. 07-30311.

No. 07-30316.

United States Court of Appeals, Ninth Circuit.

Submitted July 8, 2008.^*

Filed September 5, 2008.

Nathan J. Hoines, Hoines Law Office, Great Falls, MT, for defendant-appellant Tina Nader.

Mark S. Werner, Federal Defenders of Montana, Billings, MT, for defendant-appellant Marilyn Lake.

Kurt G. Alme, Assistant United States Attorney, Billings, MT, for the plaintiff-appellee.

Appeal from the United States District Court for the District of Montana; Richard F. Cebull, District Judge, Presiding. D.C. No. CR-06-00106-RFC, D.C. No. CR-06-00106-RFC-02.

Before: KIM McLANE WARDLAW, RICHARD R. CLIFTON, and N. RANDY SMITH, Circuit Judges.

CLIFTON, Circuit Judge:

Tina Nader and Marilyn Lake, operators of a prostitution business, appeal their convictions for violating the Travel Act, 18 U.S.C. § 1952. Among other things, the Travel Act prohibits the use of "any facility in interstate or foreign commerce" with intent to further certain unlawful activity, including prostitution.¹ Nader and Lake used telephones to conduct their unlawful prostitution business, but there is no evidence of any calls that crossed state lines. This presents the question whether telephone calls within a single state — intrastate rather than interstate calls — can violate the Travel Act.

Nader and Lake argue that the facility at issue must actually be used in interstate commerce in order to violate the Travel Act. In support of this position, they argue that Congress showed its intent to require actual interstate activity by drafting the Travel Act to prohibit the use of "any facility in interstate or foreign commerce" rather than the use of "any facility of interstate or foreign commerce." They also argue that their conduct falls outside the Travel Act's primary legislative purpose, which was to target organized crime, particularly crime bosses who supervise illegal activities in one state while residing in another. The government responds that Nader and Lake's interpretation is at odds with the plain meaning of the Travel Act because the phrase "in interstate or foreign commerce" plainly modifies the word "facility," not the word "uses." The government also argues that Congress intended the terms "in" and "of" to be interchangeable, since it used them interchangeably in the related federal murder-for-hire statute.

The government's interpretation of the Travel Act is the more sensible. We affirm Nader and Lake's convictions and hold that intrastate telephone calls made with intent to further unlawful activity can violate the Travel Act because they involve use of a facility in interstate commerce.

I. Background

Nader owned and operated a massage studio in Billings, Montana from 1994 to 2004, and another massage studio in Great Falls, Montana from 1993 to 2006. Lake managed the Billings studio and worked for Nader until 2003 or 2004. It is undisputed that the businesses involved prostitution. Card catalogs show that the two businesses had approximately 5000 customers from Montana and at least five other states.² Many of the prostitution transactions were initiated by a telephone call from the customer.

Nader and Lake were indicted for violating 18 U.S.C. §§ 1952 and 2 by using the telephone to carry on a business enterprise involving prostitution in violation of Montana Code Ann. § 45-5-601. The government notified Nader and Lake that it intended to prove that they used a "facility in interstate or foreign commerce" with evidence of only intrastate telephone calls. Nader and Lake jointly moved to dismiss the indictment, arguing that their intrastate use of the telephone was not the use of a "facility in interstate or foreign commerce" under the Travel Act. The district court denied the motion. Nader and Lake pled guilty pursuant to plea agreements in which they expressly reserved their right to appeal the denial of their joint motion to dismiss. Lake was sentenced to 30 months imprisonment and two years of supervised release. Nader was sentenced to 46 months imprisonment and two years of supervised release. Both were released pending appeal. These timely appeals followed and were consolidated.

II. Discussion

"We review de novo a district court's refusal to dismiss an indictment when the refusal is based on an interpretation of a federal statute." United States v. Fitzgerald, 147 F.3d 1101, 1102 (9th Cir. 1998) (citing United States v. Gomez-Rodriguez, 96 F.3d 1262, 1264 (9th Cir.1996) (en banc)).

Whether the Travel Act reaches intrastate telephone calls is a question of first impression in this Circuit. We note at the outset that this is a question of congressional intent, not congressional power. Nader and Lake correctly do not contest that Congress has the power to regulate intrastate telephone calls. In United States v. Lopez, the Supreme Court identified "three broad categories of activity that Congress may regulate under its commerce power." 514 U.S. 549, 558-59, 115 S.Ct. 1624, 131 L.Ed.2d 626 (1995). Telephones are instrumentalities of interstate commerce that fall within the second Lopez category. United States v. Dela Cruz, 358 F.3d 623, 625 (9th Cir.2004); United States v. Clayton, 108 F.3d 1114, 1117 (9th Cir.1997). At issue is whether Congress intended to regulate intrastate telephone calls by the language it used in the Travel Act.

In answering this question, we first consider the plain meaning of the statute's text. Jonah R. v. Carmona, 446 F.3d 1000, 1005 (9th Cir.2006). If the terms are ambiguous, we may look to other sources to determine congressional intent, such as the canons of construction or the statute's legislative history. Id. at 1005. We may consider related statutes because "statutes dealing with similar subjects should be interpreted harmoniously." Id. at 1007 (quoting Jett v. Dallas Indep. Sch. Dist., 491 U.S. 701, 738-39, 109 S.Ct. 2702, 105 L.Ed.2d 598 (1989) (Scalia, J., concurring)). Titles are also an appropriate source from which to discern legislative intent. Goodcell v. Graham, 35 F.2d 586, 587 (9th Cir.1929) (citing Holy Trinity Church v. United States, 143 U.S. 457, 462, 12 S.Ct. 511, 36 L.Ed. 226 (1892)).

A. Whether the Facility Must Be Used in a Manner that Crosses State Lines

The Travel Act provides that "[w]hoever ... uses the mail or any facility in interstate or foreign commerce" with intent to carry on unlawful activity is guilty of a crime. 18 U.S.C. § 1952(a). Nader and Lake argue that they did not violate the Travel Act because the government has not proved that any telephone calls crossed state lines. Under Nader and Lake's interpretation, the facility at issue must actually be used in interstate commerce, so the phrase "in interstate or foreign commerce" in the Travel Act must modify the verb "uses," not the noun "facility." But a common sense reading of the plain language of the Travel Act shows that it does not. In the predicate "uses the mail or any facility in interstate or foreign commerce," the prepositional phrase "in interstate or foreign commerce" modifies the noun "facility," not the verb "uses." Congress placed the phrase next to the word "facility," which strongly supports the conclusion that the phrase modifies that word. See The Chicago Manual of Style ¶ 5.167 (15th ed. 2003) ("A prepositional phrase with an adverbial or adjectival function should be as close as possible to the word it modifies to avoid awkwardness, ambiguity, or unintended meanings."); William Strunk, Jr. & E.B. White, The Elements of Style 30 (4th ed. 2000) ("Modifiers should come, if possible, next to the words they modify."). No court has held that the phrase "in interstate or foreign commerce" modifies "uses." Even the Sixth Circuit, which held that the intrastate use of the mail cannot support a violation of the Travel Act, based its holding on other aspects of the statute. See United States v. Barry, 888 F.2d 1092, 1095 (6th Cir.1989). The plain language of the statute is unambiguous. The facility itself, not its use, must be in interstate commerce.

The weight of authority from other circuits supports this reading. The Eighth Circuit has held that the intrastate use of an ATM is the use of a "facility in interstate or foreign commerce" under the Travel Act. United States v. Baker, 82 F.3d 273, 275 (8th Cir.1996). This holding is possible only if the word modified is "facility." The Second and Fifth Circuits have held that the intrastate use of the mail can support a violation of the Travel Act. United States v. Heacock, 31 F.3d 249, 255 (5th Cir.1994); United States v. Riccardelli, 794 F.2d 829, 830 (2d Cir. 1986). Both cases involved the pre-1990 version of the Travel Act, which prohibited the use of "any facility in interstate or foreign commerce, including the mail." Both concluded based on this language that the mail is a facility in interstate commerce. If the intrastate use of the mail can violate the Travel Act, and the mail is a facility in interstate commerce, then the intrastate use of a facility in interstate commerce can violate the Travel Act. This is possible only if the word modified is "facility."³ While these cases involve facilities other than the telephone, their holdings require a grammatical construction of the Travel Act that forecloses Nader and Lake's interpretation. That the cases arise under different circumstances does not render them any less applicable here, since the phrase "in interstate or foreign commerce" modifies the same word no matter the facts of the case.

While the statutory language is unambiguous, we observe that three circuits, including the Sixth, have explicitly concluded that the phrase modifies "facility" when construing nearly identical language in the related murder-for-hire statute.⁴ See United States v. Richeson, 338 F.3d...