United States v. Seng Chen Yong, 17-16017

• Decision Date: 07 June 2019
• Docket Number: No. 17-16017,17-16017
• Citation: 926 F.3d 582
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. SENG CHEN YONG, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

926 F.3d 582

UNITED STATES of America, Plaintiff-Appellee,

v.SENG CHEN YONG, Defendant-Appellant.

No. 17-16017

United States Court of Appeals, Ninth Circuit.

Argued and Submitted September 6, 2018 San Francisco, California

Filed June 7, 2019

Thomas C. Goldstein (argued) and Tejinder Singh, Goldstein & Russell P.C., Bethesda, Maryland, for Defendant-Appellant.

Elizabeth O. White (argued), Appellate Chief; Adam Flake, Assistant United States Attorney; Steven W. Myhre, Acting United States Attorney; United States Attorney's Office, Las Vegas, Nevada; for Plaintiff-Appellee.

Before: Marsha S. Berzon and Michelle T. Friedland, Circuit Judges, and Kathleen Cardone,^* District Judge.

CARDONE, District Judge:

Defendant-Appellant Seng Chen Yong ("Yong") appeals the denial of his 28 U.S.C. § 2255 motion to vacate his guilty plea and set aside his misdemeanor conviction related to operating an unlawful sports betting operation. Yong and a group of associates were originally charged with felonies related to an illegal sports betting operation based in Caesars Palace Hotel & Casino ("Caesars") in Las Vegas during the 2014 World Cup soccer tournament. As part of a group plea deal, Yong and three co-defendants pleaded guilty to the misdemeanor of acting as an accessory after the fact to co-defendant Hui Tang's violations of the Wire Act, 18 U.S.C. § 1084. In exchange for this group plea, the Government dismissed felony charges pending against Yong's son, Wai Kin Yong ("Wai Kin"). On appeal, Yong argues that his guilty plea was involuntary because it was improperly conditioned on leniency for Wai Kin and was tainted by government misconduct.

As to the first issue, we consider, as a matter of first impression, the standard for determining the voluntariness of guilty pleas obtained through offers of leniency for third parties. We hold that a guilty plea made in exchange for leniency to a third party is involuntarily made if the government lacked probable cause to prosecute the third party at the time of the guilty plea. Because the Government had probable cause to prosecute Wai Kin at the time of Yong's plea, we affirm. We likewise affirm on the government misconduct challenge, as Yong was aware of the Government's misconduct at the time of his plea but nonetheless pleaded guilty.

FACTUAL AND PROCEDURAL HISTORY

In June of 2014, a group of gamblers from Asia traveled to Las Vegas for the 2014 FIFA World Cup soccer tournament kickoff. The group stayed at Caesars in luxury villas ranging in size from 8,000 to 12,000 square feet. Yong, his son Wai Kin, and their guests stayed in Villa 8881. Wei Seng Phua ("Phua"), his son Wai Kit Phua ("Wai Kit"), and their guests stayed in Villa 8882. Hui Tang and his guests stayed in Villa 8888.

During this stay, a Caesars employee entered Villa 8888 to check on the condition of the suite. The employee noticed an array of computers and computer monitors that were not normally present in the room and were arranged in an unusual configuration. The employee reported the presence of the computers to his supervisors. Caesars technical support and security staff discovered that the guests of Villa 8888 had requested the installation of an unusual amount of technical equipment, including eight computers, multiple monitors, three televisions connected to three different cable/satellite television providers, desk telephones, and enhanced Digital Subscriber Line ("DSL") internet access. The Caesars management was concerned that the arrangement could be used to operate an illegal sports book. Caesars informed the Nevada Gaming Control Board ("NGCB"), which informed the Federal Bureau of Investigation, which opened an investigation. The FBI suspected that the individuals in the three villas were jointly participating in an illegal betting operation but lacked sufficient evidence to pursue a case against anyone except the individuals staying in Villa 8888.

After brainstorming about how to "tighten up the [probable cause]," and with assistance from a contractor responsible for internet services at Caesars, the FBI agents and the assistant United States Attorney assigned to the case devised a plan to search the villas without obtaining a warrant. FBI agents, together with NGCB agents and the cooperating IT contractor, attempted to disrupt the DSL internet service to villas 8882 and 8888, the Phua and Tang villas respectively. They did so in the hope of generating a call for service—and with such a call, the opportunity to enter the villas. No call for service came, but someone in Villa 8882 requested a laptop. Seizing on the opportunity, the contractor and an FBI agent posing as the contractor's employee went to deliver the laptop. When they entered Villa 8882, the contractor and the agent heard what sounded like a sporting event playing in the background, but a butler prevented them from going further into the suite.

Sometime later, the contractor received a service call from Villa 8881 reporting that the internet was not working. Realizing that he had accidentally disrupted the internet service for Villa 8881 instead of Villas 8882 and 8888, the contractor reconnected Villa 8881's internet and then entered Villa 8881 to look around, acting as though he was responding to the service call even though he had already fixed the disruption. The contractor carried on a fake telephone conversation "to make it look like [he was] there for a legitimate purpose," and recorded the visit on his cell phone. Yong was present in Villa 8881 while the contractor was there, looking at what appeared to the contractor to be a sports website of some kind.

The next day, the contractor tried to disrupt the service to Villa 8882 again and this time succeeded. After Phua told the butler on duty that the internet was not working, the butler put in a call for service. Two agents masquerading as technicians and wearing body cameras responded to the call so they could look for incriminating evidence. When they entered Villa 8882, the agents found Phua sitting at a laptop computer, viewing a sports betting site. On Phua's computer, the agents also saw an open instant messaging window containing the words "good luck on the hedge bet," or something similar. Another person was also viewing a sports-betting website, but he quickly switched to viewing the Google search page when he noticed an agent approaching. Yong was there as well, visiting from Villa 8881, but he was not using a laptop.

The agents, with the help of an assistant United States Attorney, filed a warrant application to search Villas 8881, 8882, and 8888. The warrant application omitted the fact that the agents had only been able to enter the villas by surreptitiously disrupting the DSL. In fact, the agents created multiple documents designed to give the false impression that the internet outages had been fortuitous, rather than orchestrated by the FBI. In addition, the warrant application asserted that the contractor, on his visit to Villa 8881 after the accidental disruption of internet service to that suite, saw Yong monitoring "odds for illegal sports gambling," even though, as the contractor later admitted, nothing about the website indicated that it was illegal, or even gambling-related at all.

The magistrate judge signed the warrant on July 9, 2014, and it was executed the same day. Yong was present when agents executed the warrant on Villa 8881, the villa where Yong and Wai Kin were staying. The search of that villa revealed gambling ledgers containing names, win/loss records, and percentages paid to various representatives and associates. Agents executing the Villa 8882 warrant found Phua, Phua's son, and Wai Kin, Yong's son, watching while a World Cup soccer match played on the television. All three were sitting in front of laptop computers viewing a sports betting website displaying real-time betting odds for the soccer game. The laptops also displayed instant messaging windows. Wai Kin's laptop, logged into the betting website showed an available balance of $ 1.6 million U.S. dollars. The agents found ledgers in Villa 8882 similar to those found in Villa 8881.

Five days later, the Government filed a criminal complaint charging eight defendants—including Yong and Wai Kin—with federal felonies, including the operation of an illegal gambling business in violation of 18 U.S.C. § 1955 and violations of the Wire Act, 18 U.S.C. § 1084. The defendants were arrested and subsequently indicted by a federal grand jury.

In the course of pre-trial discovery, the Government produced a tape recording that alerted Yong and the other defendants to the fact that the Government had intentionally disrupted the DSL to gain entry into the villas. On October 27, 2014, Phua, Phua's son, Yong, and Wai Kin filed a motion to suppress the evidence obtained from the hotel rooms, both before and after the execution of the warrant, as well as all fruits thereof. The next day, they also filed a motion arguing that the Government's misrepresentations and omissions to the magistrate judge tainted the search warrant under Franks v. Delaware , 438 U.S. 154, 98 S.Ct. 2674, 57 L.Ed.2d 667 (1978), arguing that the fruits of the search warrant must be suppressed on that basis as well. In the motions, the defendants argued that the Government invalidly obtained their consent to enter by intentionally disrupting the DSL in the defendants' villas, concealed that fact from the magistrate judge, and made numerous additional intentional or reckless misstatements in the warrant affidavit.

The Government responded to the motions in November 2014, conceding that it intentionally disrupted the DSL service to the villas but arguing that its actions were nonetheless constitutional. The Government did not, however, fully admit the extent of its actions at that time.

After the briefing on the motions was complete, but before the evidentiary hearing on the motions, Yong and four of his co-defendants negotiated pleas. Yong agreed to...