Appendix — Dennis E. Pryba, Barbara A. Pryba, Educational Books, Inc. And Jennifer G. Williams v. United States
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Supreme Coutt Vs.
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5, we
No UN
oe oo
in The
Supreme Court of the United States
October Term. 1989
DENNIS E. PRYBA
BARBARA A. PRYBA
EDUCATIONAL BOOKS, IN¢
and
IENNIFER G. WILLIAMS
_
NITED STATES OF AMERICA
Petition for Writ of Certiorari
to the L nited States Court of Appeals
for the Fourth Circuit
Appendix to
Petition for Writ of Certiorari
LIPSITZ, GREEN, FAHRINGER
ROLL, SCHULLER & JAMES
Paul John Cambria. Jr.. bea
unsel of Record
; Delaware Avenue Surte “
Buffak New York
: sid) \ RUE! .
| ~» & - wa ;
RUE! ; /* .
RDER granting appellants
[EMORANDUM Oj!
." \ : re
i} Vi wx AYN 7
f+} ViCORA Vi
[(E MORANDU™M OPI JiRE- PI
il
FOURTH ORDER modifying restraining order filed on
August 13, 1987 (filed September 11, 1987)... ......
ORDER denying government s request for leave to with-
draw its motion for inquiry into disqualification of
defense counsel for possible conflict of interest (dated
Ouashear D, ISBT... ccccccccsccccccesccesccccsss
ORDER that defendants may withdraw their motion for
a bifurcated trial with leave to renew it at the appropri-
ate time (dated October 9, 1987) ..... ~~~... 6 enn ns
ORDER denying defendants motion to dismiss Counts |
through III of the indictment for failure to plead prop-
erly elements of the RICO Act (dated October 9, 1987)
ORDER denying PHE’s motion for leave to file an ami-
cus brief (dated October 9, 1987)... . ~~. ~~... een
ORDER denying defendant Williams motion for discov-
ery of exculpatory evidence (dated October 9, 1987) . .
ORDER granting defendants motion to adopt and con-
form the motions of every other defendant ‘dated Octo-
eS Qe
ORDER denying defendants motion for production of
defendants statements in the government s possession
ander Fed. Rules of Crim. Proc. l6tall LWA) (dated
ORDER granting defendant Educational Books motion
for production of the grand jury testimony of its officers
and employees under Fed. Rules of Crim. Proc.
lta LWA) (dated October 9, IGBT). .. ~~... cen n
ORDER that defendant Educational Books, Inc.s
motion for a bill of particulars is moot (dated October 9.
Page
A-136
A-138
A-139
A-140
A-14)
A-142
A-143
A144
ORDER denying defendants’ motion for a bill of particu-
lars (dated October 9, 1987) ....................
ORDER denying defendants’ motion to compel (dated
EEE
ORDER granting the United States’ motion for an exten-
sion of time in which to file proposed jury instructions
(dated October 9, 1987)... 2... cece cece.
ORDER granting defendants’ motion for a continuance
of the trial in this action (dated October 9, 1987) ....
ORDER that a psychiatric examination of Barbara
Pryba by a licensed psychiatrist or clinical psychologist
be done and reported back to the Court; granting U.S.
motion for a hearing to determine defendant Barbara
Pryba’s competency to stand trial (dated October 19,
ORDER granting United States’ motion to bifurcate
idated October 21, 1967)... 2c cece cccccccccss
ORDER denying defendant Barbara Pryba's motion to
suppress evidence seized during a search of her resi-
dence (dated October 23, 1987) ..................
ORDER denying defendant Dennis Pryba's motion to
suppress all evidence obtained in searches authorized
by all warrants upon the grounds that affidavits filed in
support thereof were insufficient to establish probable
cause (dated October 21, 1987)..............
ORDER granting defendant Educational! Books’ motion
to introduce the prior convictions of Educational
Books; denying defendant Williams’ motion for sever-
ance (dated October 23, 1987) .....
ORDER OF FORFEITURE, filed November 18, 1987
Page
A-148
4-149
4-150
4-15]
A-152
A-154
4-155
4-156
4-158
4-159
4-164
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
NITED STATES OF AMERICA
INNIS EE. PRYBA
, f
PHE. IN¢
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\ o> AAT
NITRUD STATES OF AMERICA
f
ARBARA i
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Hil
: STATI r AMERICA
‘ VAL I h
HI
No. 88-5004
UNITED STATES OF AMERICA,
Piaintiff-Appellee.
versus
JENNIFER G. WILLIAMS,
Defendant-Appellant,
PHE, INC.,
Amicus Curiae.
Appeals from the United States District Court for the Eastern
District of Virginia, at Alexandria. T.S. Ellis II], District Judge.
(CR-87-208-A)
Argued: October 4, 1989 Decided: April 9, 1990
Refore RUSSELL. WIDENER, and CHAPMAN, Circuit
Judges.
Affirmed by published opinion. Judge Chapman wrote the opin-
ion, in which Judge Russell and Judge Widener joined.
ARGUED: Paul J. Cambria, Jr.. LIPSITZ, GREEN,
FAHRINGER, ROLL, SCHULLER & JAMES, Buffalo, New
York, for Appellants. William Graham Otis, Assistant United
States Attorney, Alexandria, Virginia, for Appellee. ON BRIEF:
Cherie L. Peterson, LIPSITZ, GREEN, FAHKINGER,
ROLL, SCHULLER & JAMES, Buffalo, New York; Plata
Cacheris, CACHERIS & TOWEY, Washington, D.C. for Appel-
A-3
lants. Henry E. Hudson, United States Attorney, Alexandria.
Virginia, for Appeilee. Donald B. Verrilli, Jr., David W. Ogden.
Bruce J. Ennis. JENNER & BLOCK, Washington, D.C., for
Amicus Curiae.
CHAPMAN, Circuit Judge:
Following a jury trial, appellants were convicted of various
offenses relating to the sale of obscene video tapes and obscene
magazines. Dennis E. Pryba and Barbara A. Pryba, husband
and wife, were each convicted of one count of violating 18 U.S.C.
§ 1962(a) (participating in a pattern of racketeering activity); one
count of violating 18 U.S.C. § 1962i(c) (employed by a criminal
enterprise engaged in racketeering activities); one count of violat-
ing 18 U.S.C. § 1962(d) (conspiracy to violate 1962[a]); and seven
counts of violating 18 U.S.C. §§ 1465 and 2 (transportation of
obscene materials in interstate commerce for sale and distribu-
tion). Jennifer G. Williams was acquitted on Count I, violation of
§ 1962(a), but convicted of all of the remaining counts. Educa-
tional Books, Inc. was convicted of one count of violating 18
U.S.C. § 1962(a) and one count of violating 18 U.S.C. § 1962id).
All defendants appeal their judgments of conviction and they
raise constitutional challenges to the forfeiture provisions of the
federal RICO statute, the use of the prior state obscenity convic-
tions of Educational Books, Inc. to prove predicate acts of racke-
teering, and various rulings made by the trial court in the
admission of evidence and in the voir dire examination of prospec-
tive jurors. After a careful consideration of the record, the briefs.
and the oral argument, we affirm.
Dennis E. Pryba and Barbara A. Pryba owned corporations
which operated nine video rental stores and three bookstores in
Northern Virginia. The corporations B & D Corporation and
A+
Educational Books, Inc. operated Video Rental Center Stores
which stocked inventories of general audience video tapes and
sexually explicit adult video tapes. Although the Prybas owned
the stock in the corporations, they were never listed as officers or
directors, because Mr. Pryba stated that he wanted to disguise
who was actually in charge in the event of trouble with the police.
Jennifer Williams was a long-time employee and Lookkeeper. and
was listed as president of B & D Corporation. She performed
numerous services for the corporation. although she argues that
her role was so minimal that the proof was insufficient to convict
her.
The Video Rental Center Stores also stocked rubber goods.
‘marital aids,” and “peek booths” through which one could view
two or three minutes of sexually explicit tape upon payment of a
quarter. The heart of the government's case consisted of the intro-
duction of the tapes and magazines that were alleged to be
obscene. The indictments were brought following an obscenity
investigation during which investigators opened memberships
with video retail centers and rented or purchased sexually explicit
video tapes and magazines. At trial the jury found six of the nine
magazines to be obscene and four video tapes that had been
rented or purchased to be obscene. The content of this material is
accurately and unemotionally described by the dist. ict judge in
United States v. Pryba, 678 F. Supp. 1225, 1227-28 (E.D. Va.
1988):
1. She-Male Confidential, Bizarre Encounter #9. This
video depicts a variety of sexual activities involving “she-
males’ — persons who have female bodies, including fully
developed breasts. They are women in all respects save one:
they have male genitalia. In the first scene, two she-males
dressed as women engage in fellatio and anal intercourse
with a man. The second vignette depicts a she-male insert-
ing what appears to be a large pipe into a woman s anus. The
she-male and the woman also engage in vaginal! and anal
4-5
intercuurse. The third scene captioned “Spanked by a
Stranger, shows a man throwing a she-male to the ground
and performing fellatio upon the she-male. The man then
has anal intercourse with the she-male.
2. Wet Shots. This video features men and women
engaged in vaginal and anal intercourse and ora! sex. Many
of the scenes involve groups of men and women. The film
also contains close-up depictions of male ejaculations on the
bodies and faces of others. In one scene. men are shown ejac-
ulating into a glass of liqueur. A woman then drinks the mix-
ture.
3. The Girls of the A-Team. This film. as the title might
suggest, is devoted chiefly to showing anal intercourse
between men and women, in couples and in groups. The
film also depicts a variety of other sexual activities between
women in couples and larger groups. including vaginal and
anal insertion of a range of objects.
4. The Punishment of Anne. This video predictably has a
sado-masochistic theme. A woman and a man subject a
younger woman to various forms of degradation, including
forcing her to urinate in front of them, photographing her
while she is naked and in various positions of bondage.
whipping her while she is naked. inserting vegetables into
her vagina, putting chains on her and sticking pins into her
breasts.
The content of most of the magazines is also sadomaso-
chistic in nature.
|. Torment depicts nude and partially clad women bound
and su spended by ropes, chains and straps in contorted posi-
tions. Ropes and straps appear frequently in the genital
area. Many of the women have tortured expressions on their
faces. Welts, whether actual or simulated. appear on some of
the women. The accompanying text deals exclusively with
bondage and includes descriptions of the sexual pleasure
which the sadistic party derives from forcing the victim t
endure pairiul positions of bondage for long periods of time
A
2. In She ... Who Must be Obeved. a woman is shown
subjecting a nude man to bondage and whipping. Acts of
violence to the man's genitals are also vividly depicted.
3. Bottoms Up chiefly depicts nude women being
spanked with hands and with objects such as canes and
whips. The buttocks of several of the women appear to be
red and bruised as if flagellation were actually taking place.
The stories involve the sexual gratification which both the
abusers and victims receive from this bizarre activity.
4. In Slave Training. acts of abuse to male and female
genitals are shown in cartoons and photographs. In several
photographs, mousetraps and tourniquet devices are pic-
tured on women's breasts. One woman s breasts have actu-
ally become purple due to tourniquets. The text focuses on
various forms of emotional and physical abuse, such as
insertion of steel rings into a woman s nipples and caning of
a man's penis.
5. Tied Up depicts naked and partially clad women in
various states of bondage and includes several closeup pho-
tographs of women s genitals.
6. Finally, the photographs in Super Bitch depict female
domination and male submissiveness.
The remaining three magazines contain graphic depic-
tions of female genitals. Tender Shavers shows young
women shaving their pubic hair and masturbating. Whether
some of the models are adults or juveniles is unclear. Bobby
socks. ponytails and makeup are employed to underscore. if
not create. the appearance of adolescence. presumably to
appeal to hedophiles. Crotches contains prominent almost
clinical. displays of young women s genitals. The accompa-
nying text makes clear that the reader is supposed to believe
that the models are teenage girls. The last magazine. Poppin
Viamas. depicts naked pregnant women in lascivious poses
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Following the verdicts of conviction, Dennis Pryba was sen-
tenced to three years imprisonment on Count |, ten years on
Counts II and II], and five years each on Counts IV through X.
The sentences on Counts II through X are to run concurrently
with each other but consecutively to the three year sentence on
Count I, but they were suspended in favor of five years probation.
Dennis Pryba was also sentenced to pay a fine of $75,000 under
Count II, and as a condition to probation following his prison
term. he was directed to make monthly payments in satisfaction
of unpaid fines previously imposed as a result of state convictions
of his businesses.
Barbara Pryba was sentenced to suspended terms of three
years imprisonment on Counts I and II and Counts IV through
X. and to a suspended sentence of ten years on Count III. She was
also sentenced to concurrent terms of three years probation on all
counts and fined $200,000.
Educational Books, Inc. was sentenced to pay fines of $100,000
on each of Counts I and IIL. Jennifer Williams was sentenced to
concurrent terms of three years imprisonment on Counts I!
through X and these terms were suspended and she was placed on
probation for three years and fined $2,250.
Following the jury verdicts finding violations of 18 U.S.C.
§ 1962(a), (c), and (d)}, the same jury heard an additional week of
testimony on the issue of forfeiture under 18 U.S.C. § 1963(aN 1).
The jury found that defendants had certain interests in property
which afforded them a source of influence over the enterprise and
directed that all shares of stock in B & [D) Corporation, Educa-
tional Books, Inc., Marlboro News. Home Video Sales. Inc.. and
Video Shop, Ltd. be forfeited, together with corporate assets, cer-
tain real estate and motor vehicles. L pon this verdict, the court
issued an order of forfeiture and the government immediately dis-
natched U nited States Marshals to padlock the doors of the three
a
4-10
Defendants argue that the RICO forfeiture provisions, as
guaiietenaed ' - ‘sting of ol ley violeti
are an unconstitutional prior restraint of protected expression,
have a chilling effect on constitutionally protected expression.
and are overly broad in their application.
There is nothing se unusual about obscenity convictions that
they may not be used as RICO predicate offenses. There is no con-
stitutional protection for materials adjudged to be obscene. Roth
v. United States, 354 U.S. 476, 485, 77 8.C1. 1304, 1309, 1 L. Ed.
2d 1498 (1957) The appellants have no protected right to be free
from prosecution for violating the federal obscenity statutes and
the Supreme Court, in Fort Wayne Books, Inc. v. Indiana.
U.S... 109 S.C. 916, 102 L. Ed. 2d 34 (1989), held that
substantive obscenity violations cour serve as predicate offenses
under the Indiana RICO statute which is patterned after the fed-
eral RICO statute. There is no merit to the claim that obscenity
violations may not be RICO predicate offenses.
The constitutionality of criminal sanctions against those who
distribute obscene materials is well established. Pinkus v. United
States, 436 U.S. 293, 98 S.Ct. 1808, 56 L. Ed. 2d 293 (1978):
Splawn v. California, 431 U.S. 595, 97 §.Ct. 1987, 53 L. Ed. 24
606 (1977h Miller v. California, 413 U.S. 15, 93 8.Cr. 1325, 1 L.
Ed. 2d 419 (1973); Kingsley Books, Inc. v. Brown, 354 U.S. 436
(1957). These sanctions may include imprisonment and fines.
Smith v. United States, 431 U.S. 291, 97 §.Cr. 1756, 53 L. Ed. 2d
324 (1977115 year prison term and $5,000 fine for first offense: 10
year prison term and $10,000 fine for each subsequent violation |.
United States v. Guglielmi, 819 F.2d 451 (4th Cir. 1987). cert.
denied, 484 U.S. 1019 (1988) (25 pear prison term).
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reasonable doubt the obscenity of certain of defendants stock in
trade. Freedman did not involve, did not discuss, and has no
application to RICO forfeitures. It involved a film that by the
state s admission was not obscene and did not violate the stand-
ards set by the censorship statute
In 1984 the RICO statute was amended by adding obscenity to
the predicate offenses constituting “racketeering activity. Appel-
was the desire to eliminate pornography and obscenity. This
intent. coupled with the oryunal intent of the forfeiture provisions
of RICO, was to incapacitate a defendant from continuing the
activity giving rise to the RICO violation by removing his eco-
nomuc wherewithal to continue. Appellants claim that the forfeit-
ures at issue here have incapacitated them from future expression
of any sort as a consequence of past acts of unprotected speech.
This, they claim. is forbidden under Near v. Minnesota, 283 U.S.
697, 51 S.Cx. 625, 75 L. Ed. 2d 1357 (1931).
Near is of no assistance. The factual situation and the lew
involved there were vastly different. In 1925. Minnesota passed a
statute to abate. as a pubhe nuisance. the publication of mali-
crous, scandalous and defamatory newspapers. magazines and
other penodicals. The law provided that there was available the
defense that the truth was published “with good motives and for
justifiable ends.” Under the law, the County Attorney where the
penodical was published or the State Attorney General, upon fail-
ure of the County Attorney to proceed. or a private citizen im the
name of the state. upon failure of both the County Attorney and
the Attorney General to proceed. could commence an action to
perpetually enjyoun the person committing or maintaining such
nussance from further committing or maintaining it. Near pub-
bers of the County Grand Jury were turning a blind eve to gam-
)
7
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A-13
bling, bootlegging and racketeering in Minneapolis. Th~ state
ccurt found that the publication was “largely devoted to mali-
cious, scandalous and defamatory articles’ within the meaning of
the statute. It was held to be a public nuisance. The judgment
perpetually enjoined Near from producing, editing, publishing,
circulating, having in his possession, selling or giving away any
publication which was malicious, scandalous or defamatory, and
from conducting a business under the name of The Saturday
Press or any other name. The Supreme Court struck down the
statute and found it to be “the essence of censorship. /d. at 713.
51 S.Ct. at 630. Near involved a clear case of both censorship and
prior restraint of publications containing news and comment on
the news. It is difficult to imagine a situation more clearly pro-
tected by the First Amendment. Near has no application to
obscenity, and sheds no light on the issues before us.
Appellants claim that RICO forfeiture curtails First Amend-
ment rights when the predicate offenses are obscenity violations.
However, it is not the predicate offenses that impact on First
Amendment rights, but it is the forfeiture that may curtail speech
impermissibly. There are specific statutes which establish crimes
relating to the sale, transportation and mailing of obscene materi-
als. See 18 U.S.C. §§ 1460-1469. These statutes also provide
imprisonment and fines upon conviction, and § 1467 allows crim-
inal forfeiture not only of obscene materials, but also any real or
personal property traceable to the proceeds obtained from such
offense and/or used to commit or to promote the commission of
the offense.
Following the guilty verdicts of the defendants, evidence was
presented for a week on the issue of forfeiture. A properly
instructed jury unanimously decided upon an adequate record
that the defendants owned or had an interest in the proceeds in the
properties that were forfeited, and that the properties afforded
A-14
defendants a source of influence over the enterprise that the
defendants conducted in violation of 18 U.S.C. § 1962.
The forfeiture provided by 18 U.S.C. § 1467 does not violate
the First Amendment even though certain materials, books and
magazines, that are forfeited, may not be obscene and, in other
circumstances, would have constitutional protection as free
expression. There was a nexus established between defendants il]
gotten gains from their racketeering activities and the protected
materials that were forfeited. The forfeiture did not occur until
after defendants were convicted of violating various obscenity
statutes and of participating in a racketeering activity, and until
after it was established beyond a reasonable doubt that the pro-
ceeds from these criminal activities had been used to acquire the
arguably protected publications.
The defendants may not launder their money derived from
racketeering activities by investing it in bookstores, videos, maga-
zines and other publications. The First Amendment may be used
as a shield, but it is not a shield against criminal activity. To follow
the defendants’ argument would allow crininals to protect their
loot by investing it in newspapers, magazines, radio and television
stations. Carried to its logical end, this reasoning would allow the
Colombian drug lords to protect their enormous profits by pur-
chasing the New York Times or the Columbia Broadcasting Sys-
tem.
Defendants seek support from Fort Wayne Books, Inc. v. Indi-
ana, supra, __U.S.___, 109 S.Ct. 916, 103 L. Ed. 2d 34, but
this case is of no assistance to them. It involved the Indiana RICO
statute and a civil action which authorized the court, following an
ex parte hearing, to order the immediate seizure of a bookstore
and its contents which were alleged to be used in the racketeering
activity. The Supreme Court found that pretrial seizure of the
bookstore and its contents was improper and that the books and
films could not be taken out of circulation until there had been a
Es
A-15
determination of obscenity after an adversary hearing. Although
defendants rely on Fort Wayne, it actually forecloses a number of
their arguments. In deciding that the Indiana RICO statute, pat-
terned after the federal RICO statute, was not unconstitutional!
because of the inclusion of substantive obscenity violations
among the predicate offenses, the Court heid that the use of
RICO sanctions in racketeering based upon obscenity violations
was not so “draconian” as to have a chilling effect upon First
Amendment freedom, id. at ___., 109 S.Ct. at 925, and that the
greater punishment under RICO was not constitutionally signifi-
cant when compared with punishment available under obscenity
statutes. Id. Fort Wayne did not reach the issue of post-trial for-
feiture, but emphasized that the materials considered by the court
prior to seizure were merely to establish probable cause and con-
cluded that the Indiana procedure did not pass constitutional
muster because the seized materials were expressive and pre-
sumed to be protected by the First Amendment, and that this pre-
sumption was not rebutted ‘until the claimed justification for
seizing books or other publications is properly established in an
adversary proceeding. I/d. at ___., 109 S.Ct. 929. In its final
footnote, the majority opinion stated
Although it is of no direct significance, we note that the fed-
eral government — which has a RICO statute similar to
Indiana s, 18 U.S.C. § 1961, et seq. — does not pursue pre-
trial seizure of expressive materials in its RICO actions
against ‘adult bookstores’ or like operations. See brief of
United States as amicus curiae, 15, n.12; cf. United States t
Pryba, 674 F.Supp. 1504, 1508, n.16 (E.D.Va. 1987)
Id. at 109 S.Ct. 930
he forfeiture of nonobscene books, magazines and video
tapes, after a conviction of racketeering involving the sale of
obscene goods and after the jury has determined that the forfeited
materials were acquired or maintained in violation of 18 U.S.¢
A-16
§ 1962 and afforded the Prybas a source of influence over the
racketeering enterprise, does not violate the First Amendment.
The fact that some of the materials forfeited are not obscene does
not protect them from forfeiture when the procedures established
by RICO are followed, as they were in the present case.
Appellants argue that forfeiture of nonobscene materials has a
chilling effect on their right of expression. This does not make for-
feiture unconstitutional. Both a prison term and a large fine
would have a chilling effect on the right of expression, but such
penalties are constitutional. The Prybas were exposed to 35 years
imprisonment plus a fine of $1,750,000 each without consider-
ation of the RICO count. If imprisoned, their rights of expression
would be restricted. It is doubtful that the business could survive
fines of the amount authorized by statute, and this would in effect
chill the right to sell presumptively protected material. However,
this does not make the prison terms or the fines unconstitutional.
The same reasoning applies to forfeitures.
This issue was presented in 5]] Detroit Street, Inc. v. Kelley,
807 F.2d 1293 (6th Cir. 1986), which involved the Michigan anti-
obscenity law. The court noted a statement from the legislative
history: ““The best way to curtail dissemination of pornography is
to make it unprofitable, hence the bill's provisions for fines of up
to $5 million.” Jd. at 1298-99. The district court had found the act
to be vague and overly broad and an impermissible restraint on
protected speech. However, the circuit court stated:
Furthermore, the district court concluded that because a
sentencing judge may look at total profits, from sales of both
protected and obscene materials, in determining the appro-
priate fine under Section 5, protected material will be
“penalized”, for there will be no judicial determination of
just how much of the total profits was derived from dissemi-
nation of obscene material.
A-17
We reject this contention. We refuse to hold that a statute
threatening fines that could impair the operation of a busi-
ness is an impermissible prior restraint on expression, even
where that business also involves dissemination of protected
materials. The fact that a person does some business dissem-
inating protected materials cannot immunize that person
from large fines that may be imposed for violation of crimi-
nal law.
Id. at 1299.
Appellants have beckoned us into a thicket of constitutional
claims, asserting prior restraint, the chilling of free expression,
and methods of regulating obscenity that are vague and overly
broad, but we decline this invitation. Such an exercise is not nec-
essary to resolve this case. Obscenity is not protected by the First
Amendment and a convicted racketeer may not launder his dirty
money by investing it in materials that involve protected speech.
IV
lhe forfeiture of appellants business assets was not cruel and
unusual punishment or an excessive fine prohibited by the Eighth
Amendment. In L/nited States v. Guglielmi, 819 F.2d 451 (4th
Cir. 1987), cert. denied, 484 U.S. 1019 (1988), we approved a
prison sentence of 25 years and a fine of $35,000 on conviction of
five counts of interstate shipment of obscene materials.
Plaintiff argues that forfeiture of their properties upon convic-
tion of their “minor crimes’ is disproportionate. Even if we
thought a proportional analysis was required. appellants have
failed to proffer the information that would be required for such
an undertaking. However, such an analysis is not required
because appellants did not receive a sentence of sufficient severity
to trigger a proportionality review. L nited States v. Whitehead.
849 F.2d 849, 860 (4th Cir. 1988); Lnited States v. Rhodes. 779
F.2d 1019, 1027-28 14th Cir. 1985), cert. denied. 476 U.S. 1182
A-18
(1986) (Solem v. Helm, 463 U.S. 277, 103 $.Ct. 3001, 17 L. Ed.
2d 637 (1983) does not require a proportionality review of any sen-
tence less than life imprisonment without the p ssibility of
parole}.
At trial appellants sought to introduce a public opinion survey
conducted through telephone calls by a professor of social sciences
and psychology at Luke University. The survey was offered to
demonstrate the community's attitude, toleration and standards
with regard to sexually explicit materials. They also sought to
introduce an “ethrographical” scudy by another sociologist, who
testifi_d that an “ethnological” study “looks at what is going on in
the trial judge refused to admit the survey results or the testimony
of these experts. After the trial the district court in a very scholarly
and detailed opinion set forth his reasons for excluding this evi-
dence. See United States v. Pryba, 678 F. Supp. 1225 (E.D. Va.
1988). We adopt the reasoning of the district court and find the
claim of error in refusing to admit these studies or this testimony
to be without merit.
In Paris Adult Theater I v. Slaton, 413 U.S. 49. 93 S.Ct. 2628,
37 L Ed. 2d 446 (1973), the court found that the jury needed no
assistance from experts on the issue of obscenity once the chal-
lenged materials are in evidence. In the present case, the basis of
the district court's refusal to admit this evidence was his finding
that the questions presented by the pollsters ‘n conducting their
surveys did not accurately and fully describe the challenged mate-
rials being sold by the appellants. Asking a person in a telephone
interview as to whether one is offended by nudity, is a far crv from
showing the materials previously described in this opinion. and
then asking if thev are offensive.
4-19
In dealing with the difficult question of describing obscenity,
one takes comfort in the statement of Justice Stewart:
I have reached the conclusion, which I| think is confirmed at
least by negative implication in the court s decisions since
Roth and Alberts, that under the First and Fourteenth
Amendments criminal laws in this area are constitutionally
limited to hard-core pornography. | shall not today attempt
further to define the kinds of material I understand to be
embraced within that shorthand description: and perhaps |
could never succeed in intelligibly doing so. But | know it
when I see 1. and the motion picture involved in this case is
not that.
Jacobellis v. Ohio, 37% U.S. 184, 197, 845.Cr. 1676, 1683. 12
Ed. 2d 793 (1964) (footnotes omitted).
The jurors in the present case saw the materials and found some
of it to be obscene. some of it not to be obscene, and could not
unanimously agree on certain materials. We agree with the dis-
trict judge that the jurors would not have been helped by the prof-
fered testimony
‘I
The night of peremptory challenge ts ‘one of the most impor-
tant of the rights secured to the accused. Pointer v. lL nited
States, 151 U.S. 396, 408, 145.Cr. 410, 414, 38 L. Ed. 208 (1894)
However, the refusal of the district court in its extensive vou dire
of prospective jurors to ask seven questions of the |] 7 questions
(many with subparts! presented by appellants did not prejudice
the appellants in the exercise of their challenges or in the ultimate
selection of the jurors
The trial judge went to great pains in reviewing all of the ques-
trons prog wed. and found some to be overly intrusive. We do not
find that he abused his discretion in this area. “It is well estab
A-20
lished that a trial court may exercise broad discretion in conduct-
ing the voir dire of the jury, and particularly in phrasing the
questions to be asked.” United States v. Jones, 608 F.2d 1004,
1007 (4th Cir. 1979), cert. denied, 444 U.S. 1086 (1980).
Vil
Appellants contend that the trial court improperly admitted
into evidence the 15 prior state court obscenity convictions of
defendant Educational Books, Inc. Its argument that the gov-rn-
ment cannot prove predicate acts by state court convictions is
without merit. Judge Parker laid this issue to rest almost 60 years
ago when ou. court decided, in Myers v. United States, 49 F.2d
230 ‘4th Cir. 1931), that the evidence that a defendant had pled
guilty in state court to possession of liquor found on premises on
the day following the alleged sale was properly admitted in a fed-
eral court prosecution for the sale. The trial court faced and
decided this issue in its well reasoned opinion, United States v.
Pryba, 680 F. Supp. 790 (E.D. Va. 1988). We find its opinion per-
suasive and adopt it.
The individual defendants claim that they were prejudiced by
the introduction of the records of the 15 state court convictions of
the corporate defendant. A careful examination of the record
reveals that the trial judge took meticulous care to instruct the
jury that the prior convictions of Educational Books, Inc. could
only be considered predicate acts as to the corporate defendant.
On at least seven occasions the judge explained how these convic-
tions could be used and there could be no doubt in the minds of
the jurors on this point.
T>« .sdividual defendants claim that there was a spill-over
effect as a result of the introduction of these prior convictions, but
our review of the record does not confirm this. The jury was care-
fully instructed to consider the evidence separately as to each
defendant and as to each count in the indictment. It is obvious
A-21
that the jury followed these instructions. It acquitted defendant
Williams on Count | and acquitted the Prybas on the tax counts.
Vill "
We find no merit to appellant Williams’ claim that she should
have been severed. Persons indicted together should be tried
together, United States v. Brugman, 655 F.2d 540, 542 (4th Cir.
1981), and the defendant must show that a joint trial would have
been so prejudicial as to have resulted in a miscarriage of justice.
Id. at 542-43. Williams did not make such a showing and it is
obvious from the jury's verdict that the charges against her were
considered individually: she was acquitted on a charge on which
all other defendants were found guilty.
IX
Appellants claim error in the jury instructions because the trial
judge charged:
Contemporary commusity standards are set by what is, in
fact, accepted in the adult community as a whole, and not by
what the community merely tolerates and not by what by
some groups or persons may believe the community ought to
accept or refuse to accept. Obscenity is not a matter of indi-
vidual taste, and the question is not how the material
impresses an individual juror; rather, the test is whether the
average adult person of the community would view the mate-
rial as an appeal to the prurient interest in nudity, sex, or
excretion.
Appellants claim the test for obscenity to be a community's tolera-
tion for sexually oriented material — what a community will put
up with, permit or allow. They seek support of this standard in
Smith v. United States, 431 U.S. 291, 305, 97 S.Ct. 1756, 1766, 52
L. Ed. 2d 324 (1977):
A-22
Our decision that contemporary community standards must
be applied by juries in accordance with their own under-
standing of the tolerance of the average person in their com-
munity does not mean, as has been suggested, that obscenity
convictions will be virtually unreviewable.
This language is taken from the court's discussion of the test
established in Miller v. California, 413 U.S. 15, 93 S. Ct. 2607, 37
L. Ed. 2d 419 (1973), in which the court enunciated a test for
obscene and hard core pornography materials. Under this test the
)ury must decide (a) whether the average person applying contem-
Brorary community standards would find that the work, taken as a
whole, appealed to prurient interests; (b) whether the work
depicts or describes in a patently offensive way, sexual conduct
specifically defined by the applicable state law; and (c) whether
the work, taken as a whole, lacks serious literary, artistic, politi-
cal, or scientific value. Miller involved a state statute, but the test
has been found equally applicable to federal legislation. United
States v. 12 200 Foot Reels of Film, 413 U.S. 123, 129-130, 93
S.Ct. 2665, 2670, 37 L. Ed. 2d 500 (1973); United States v. Orito.
413 U.S. 139, 145, 93 S.Ct. 2674, 2679, 37 L. Ed. 2d 513 (1973):
and Hamling v. United States, 418 U.S. 87, 94 S.Ct. 2887, 41 L.
Ed. 2d 590 (1974). Miller does not mention “acceptance” or “‘tol-
eration’ in discussing contemporary community standards.
To consider community toleration as synonymous with what a
community will put up with skews the test of obscenity and invites
one to consider deviations from community standards, because a
community can be said to put up with a number of disagreeable
circumsiances that it cannot stop. The District of Colurnbia had
over 350 murders in 1989, but to say that the citizens “tolerated”
this epidemic of homicides would misuse the word. While the City
of Washington may not be able to eradicate murder, it can stop the
sale of obscenity by assuming the burden of prosecuting those
engaged in this crime.
A-23
To take the word “tolerance” out of one sentence in and insist
that it be used as the test for contemporary community standards
misreads the opinion. It is ironic that the word “toleration”
should be taken from one part of the opinion, while the opinion
ciearly states that ‘‘the court instructed the jury that contempo-
rary community standards were set by what is in fact accepted in
the community as a whole.” 431 U.S. at 297-98, 97 S.Ct. at 1762.
The use of tolerance as the correct test was rejected by the Fifth
Circuit in Hoover v. Byrd, 801 F.2d 740 (5th Cir. 1986), when the
court stated:
Petitioner's insistence that “tolerance’’ must be substituted
for ‘‘decency” affronts the notion of “standards,” because
tolerance embodies the permissible deviations from stand-
ards. As was shown above, the Miller definition of obscen-
ity, taken as a whole, narrowly circumscribes the arena of
state regulation to depictions or descriptions of sexual con-
duct which per se deviate from those of the community at
large. Moreover, as Miller and Smith emphasize, obscenity
is to be judged by community standards, which requires the
jury to consider the average person rather than the most
prudish or most tolerant. Smith, supra. To incorporate a
requirement of “tolerance” within the definition of “‘com-
munity standards” not only turns the notion of standards
upside down, but it also undermines the goal of Miller to
permit differing levels of obscenity regulation in ... diverse
communities.
4%
801 F.2d at 741-42 (emphasis in original).
We find no error in the jury instructions for failing to charge on
community toleration.
A-24
xX
Appellants claim error in the jury instructions relating to the
RICO conspiracy count, and they argue that, to convict, the gov-
ernment must prove that a defendant personally agreed to com-
mit two or more specified predicate crimes. On this point the
district judge charged that, to convict a defendant of RICO con-
spiracy, the government must prove:
[T]hat each defendant agreed to personally commit or aid
and abet two or more acts of racketeering in violation of Sec-
tion 1962(a) or that each defendant agreed that another
coconspirator would commit two or more acts of racketeer-
ing in violation of 1962(a).
Appellants argue that this language allows a conviction even if
the jury failed to find that the defendant personally agreed to
commit the two or more predicate acts; however, to adopt appel-
lants’ argument would require that RICO conspirators be
involved in the affairs of a conspiracy to a greater extent than
required in other conspiracies. The heart of a conspiracy is the
agreement to do something that the law forbids. There is no
requirement that each conspirator personally commit illegal acts
in furtherance of the conspiracy or to accomplish its objectives. To
adopt appellants’ position would add an element to RICO con-
spiracy that Congress did not direct, and this would be contrary to
the majority of circuits which have decided the issue. United
States v. Rosenthal, 793 F.2d 1214, 1228 (llth Cir. 1986)
(Finally, tre is no requirement that each defendant must have
agreed t umit two predicate acts of racketeering #tivity.
United States v. Carter, 721 F.2d 1514, 1528-31 (11th Cir. 1984).
The government need only prove that each defendant conspired
to commit the substantive RICO offense and was aware that oth-
ers had done likewise.’’); United States v. Neapolitan, 79) F.2d
489, 498 (7th Cir. 1986) (’*Nothing on the face of the statute or its
A-25
legislative history supports the imposition of a more stringent
level of personal involvement in a conspiracy to violate RICO as
opposed to violate anything else. In fact, it seems more likely that
Congress, in search of means to prosecute the leaders of organized
crime, intended Section 1962(d) to be broad enough to encompass
those persons who, while intimately involved in the conspiracy,
neither agreed to personally commit nor actually participated in
the commission of the predicate crimes.”’); United States v.
Joseph, 781 F.2d 549, 554 (6th Cir. 1986) (“We reach a different
conclusion with respect to the conspiracy count, 18 U.S.C.
§ 1962(d). For a conspiracy conviction it is pot necessary to prove
that the defendant agreed to personally commit the requisite acts,
but only that he agreed that another violate § 1962(c) by commit-
ting two acts of racketeering activity.”); United States v. Adams.
759 F.2d 1099, 1116 (3d Cir. 1985) (“‘we now decide that to be con-
victed of a RICO conspiracy, a defendant must agree only to the
commission of the predicate acts, and need not agree to commit
personally those acts.”); United States v. Tille, 729 F.2d 615, 619
(9th Cir.), cert. denied, 469 U.S. 845 (1984) (“The statutory lan-
guage, however, does not require proof that a defendant partici-
pated personally, or agreed to participate personally, in two
predicate offenses. Read in context, section 1962(d) makes it
unlawful to conspire to conduct or participate in the conduct of an
enterprise's affairs, where its affairs are conducted through a pat-
tern of racketeering activity.”’); see also United States v. Krag-
ness, 830 F.2d 842, 859 (8th Cir. 1987).
The First and Second Circuits have adopted appellants’ view in
United States v. Ruggiero, 726 F.2d 913 (2d Cir.), cert. denied,
469 U.S. 831 (1984) and United States v. Winter, 663 F.2d 1120
(Ist Cir. 1981), cert. denied, 460 U.S. 1011 (1983). The language
in Winter relating to the agreement to commit the predicate acts
personally was dictum. Ruggiero was the first case to decide this
issue and its reasoning has not persuaded other circuits, and it
does not persuade us. RICO conspiracy does not require that
A-26
each coconspirator personally agree to commit two or more acts of
racketeering in violation of § 1962(a).
XI
Os
A-27
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 88-5001(L)
United States of America,
Plaintiff-Appellee,
versus
Dennis E. Pryba, et al,
Defendants-Appellants.
ORDER
The Court amends its opinion filed April 9, 1990, as follows:
On page 3, section 4, line 7 — ‘Lawrence J. Leiser, Assistant
United States Attorney,” is added as counsel for Appellee.
For the Court — By Direction
/s/ John M. Greacen
CLERK
Filed: May 1, 1990
David C. Schopp, Esq.
LIPSITZ, GREEN, FAHRINGER, ROLL,
SCHULLER & JAMES
1 Niagara Square
Buffalo, NY 14202
A-28
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIKCUIT
No. 88-5001(L)
United States of America,
Plainii;j- Appellee,
versus
Dennis E. Pryba,
Defendant-Appellant,
PHE, INC.,
Amicus Curiae.
ORDER
Upon consideration of appellants’ motion for stay of mandate
pending application to the Supreme Court of the United States for
writ of certiorari,
IT IS ORDERED that the motion for stay of mandate is
granted for a period of 30 days to permit the defendants to apply
for certiorari.
Entered at the direction of J udge Chapman with the concur-
rence of Judge Russell and Judge Widener.
For the Court,
/s/ John M. Greacen
CLERK
Filed: 05/01/90
David C. Schopp, Esq.
LIPSITZ, GREEN, FAHRINGER, ROLL.
SCHULLER & JAMES
1 Niagara Square
Buffalo, NY 14202
A-29
18 U).S.C. $1465. Transportation of Obscene Matters for Sale
or Distribution
Whoever knowingly transports in interstate or foreign com-
merce for the purpose of sale or distribution any obscene, lewd,
lascivious, or filthy book, pamphlet, picture, film, paper, letter,
writing, print, silhouette, drawing, figure, image, cast, phono-
graph recording, electrical transcription or other article capable
of producing sound or any other matter of indecent or immoral
character, shall be fined not more than $5,000 or imprisoned not
more than five years, or both.
The transportation as aforesaid of two or more copies of any
publication or two or more of any article of the character
described above, or a combined total of five such publications and
articles, shall create a presumption that such publications or
articles are intexJed for sale or distribution, but such presump-
tion shall be rebuttable.
When any person is convicted oi a violation of this Act, the
court in its judgment of conviction may, in addition to the penalty
prescribed, order the confiscation and disposal of such items
described herein which were found in the possession or under the
immediate control of such person at the time of his arrest.
18 U.S.C. $1961. Definitions
As used in this chapter —
(1) “racketeering activity” means (A) any act or threat
involving murder, kidnapping, gambling, arson, robbery, brib-
ery, extortion, dealing in obscene matter, or dealing in narcotic
A-30
or other dangerous drugs, which is chargeable under State law
and punishable by imprisonment for more than one year; (B)
any act which is indictable under any of the following provi-
sions of title 18, United States Code: Section 201 (relating to
bribery), section 224 (relating to sports bribery), sections 47],
472, and 473 (relating to counterieiting), section 659 (relating
to theft from interstate shipment) if the act indictable under
section 659 is felonious, section 664 (relating to embezzlement
from pension and welfare funds), sections 891-894 (relating to
extortionate credit transactions), section 1029 (relative to fraud
and related activity in connection with access devices), section
1084 (relating to the transmission of gambling information),
section 134] (relating to mail fraud), sectiow: 1343 (relating to
wire fraud), section 1344 (relating to financial institution
fraud), sections 1461-1465 (relating to obscene matter), section
1503 (relating to obstruction of justice), section 1510 (relating
to obstruction of criminal investigations), section 151] ( relating
to the obstruction of State or local law enforcement), section
1512 (relating to tampering with a witness, victim, or an
informant), section 1513 (relating to retaliating against a wit-
ness, victim, or an infosimant), section 195] (relating to inter-
ference with commerce, iobbery, or extortion), section 1952
(relating to racketeering), section 1953 (relating to interstate
transportation of wagering parapherralia), section 1954 (relat- ;
ing to unlawful welfare fund payments), section 1955 (relating
to the prohibition of iilegal gambling businesses), section 1956
(relating to the laundering of monetary instruments). section
1957 (relating to engaging in monetary transactions in property
derived from specified unlawful activity), section 1958 (relating
to use of interstate commerce facilities in the commission of
murder-for-hire), sections 2251-2252 (relating to sexual exploi-
tation of children), Sections 2312 and 2313 (relating to inter-
state transportation of stolen motor vehicles), sections 2314 and
2315 (relating to interstate transportation of stolen property},
section 232] (relating to trafficking in certain motor vehicles or
A-31
motor vehicle parts), sect‘ons 2341-2346 (relating to trafficking
in contraband cigarettes), sections 2421-24 (relating to white
slave traffic), (C) any act which is indictable ‘nder title 29,
United States Code, section 186 (dealing with -estrictions on
payments and loans to labor organizations) or section 501(c)
(relating to embezzlement from union funds), (D) any offense
involving fraud connected with a case under title 1], f. sud in
the sale of securities, or the felonious manufacture, importa-
tion, receiving, concealment, buying, selling, or otherwise
dealing in narcotic or other dangerous drugs, punishable under
any law of the United States, or (E) any act which is indictable
under the Currency and Foreign Transactions Reporting Act.
18 U.S.C. §1962. Prohibited activities
(a) It shall be unlawful for any person who has received any
income derived, directly or indirectly, from a pattern of racketeer-
ing activity or through collection of an unlawful debt in which
such person has participated as a principal within the meaning of
section 2, title 18, United States Code, to use or invest, directly or
indirectly, any part of such income, or the proceeds of such
income, in acquisition of any interesi in, or the establishment or
operation of, any enterprise which is engaged in, or the activities
of which affect, interstate or foreign commerce. A purchase of
securities on the cpen market for purposes of investment, and
without the intention of controlling or participating in the contro!
of the issuer, or cf assisting another to do so, shall not be unlawful!
under this subsection if the securities of the issuer held by the pur-
chaser, the members of his immediate family, and his or their
accomplices in any pattern or racketeering activity or the collec-
tion of an unlawful debt after such purchase do not amount in the
aggregate to one percent of the outstanding securities of any one
class, and do not confer, either in law or in fact, the power to elect
one or more directors of the issuer.
A-32
(b) It shail be unlawful for any person through a pattern of
racketeering activity or through collection of an unlawful debt to
acquire or maintain, directly or indirectly, any interest in or con-
trol of any enterprise which is engaged in, or the activities of
which affect, interstate or foreign commerce.
(c) It shall be unlawful for any person employed by or associ-
ated with any enterprise engaged in, or the activities of which
affect, interstate or foreign commerce, to conduct or participate,
directly or indirectly, in the conduct of such enterprise's affairs
through a pattern of racketeering activity or collection of unlawful
debt.
(d) It shall be unlawful for any person to conspire to violate any
of the provisions of subsection (a), (b), or (c) of this section.
18 U.S.C. $1963. Criminal penalties
(a) Whoever violates any provision of section 1962 of this chap-
ter shall be fined not more than $25,000 or imprisoned not more
than twenty years, or both, and shall forfeit to the United States.
irrespective of any provision of State law —
(1) Any interest the person has acquired or maintained in
violation of section 1962;
(2) Any —
(A) interest in;
(B) security of;
(C) claim against; or
(D) property or contractual right of any kind affording a
source of influence over;
any enterprise the person has established, operated, controlled.
os
ee *
oY
A-33
conducted, or p~rticipated in the conduct of in violation of sec-
tion 1962; and
(3) Any property constituting, or derived from. any pro-
ceeds which the person obtained, directly or indirectly, from
racketeering activity or unlawful debt collection in violaticn of
section 1962.
The court, in imposing sentence on such person shall order, in
addition to any other sentence imposed pursuant to this section.
that the person forfeit to the United States all property described
in this subsection. In lieu of a fine otherwise authorized by this
section, a defendant who derives profits or other proceeds from an
offense may be fined not more than twice the gross profits or other
proceeds.
(b) Property subject to criminal forfeiture under this section
includes —
(1) real property, including things growing on, affixed to,
and found in land; and
(2) tangible and intangible personal property, including
rights, privileges, interests, claims and securities.
(c) All right, title, and interest in property described in subsec-
tion (a) vests in the United States upon the commission of the act
giving rise to forfeiture under this section. Any such property that
is subsequently transferred to a person other than the defendant
may be the subject of a special verdict of forfeiture and thereafter
shall be ordered forfeited to the United States, unless the trans-
feree establishes in a hearing pursuant to subsection (1) thet he is
a bona find purchaser for value of such property who at the time
of purchase was reasonably without cause to believe that the
property was subject to forfeiture under this section.
A-34
idl) Upon application of the United States, the court may
enter a restraining order or injunction, require the execution of a
satisfactory performance bond, or take any other action to pre-
serve the availability of property described in subsection (a) for
forfeiture under this section —
(A) upon the filing of an indictment or information charging
a violation of section 1962 of this chapter and alleging that the
property with respect to which the order is sought would, in the
event of conviction, be subject to forfeiture under this section;
or
(B) prior to the filing of such an indictment or information,
if, after notice to persons appearing to have an interest in the
property and opportunity for a hearing, the court determines
that —
(i) there is a substantial probability that the United States
will prevail on the issue of forfeiture and that failure to enter
the order will result in the property being destroyed,
removed from the jurisdiction of the court, or otherwise
made unavailable for forfeiture; and
(ii) the need to preserve the availability of the property
through the entry of the requested order outweighs the hard-
ship on any party against whom the order is to be entered:
Provided, however, That an order entered pursuant to subpara-
graph (B) shall be effective for not more than ninety days, unless
extended by the court for good cause shown or unless an indict-
ment or information described in subparagraph (A) has been
iiled.
(2) A temporary restraining order under this subsection may
be entered upon application of the United States without notice or
opportunity for a hearing when an information or indictment has
A-35
not yet been filed with respect to the property, if the United States
demonstrates that there is probable cause to believe that the prop-
erty with respect to which the order is sought would, in the event
of conviction, be subject to forfeiture under this section and that
provision of notice will jeopardize the availability of the property
for forfeiture. Such a temporary order shall expire not more than
ten days after the date on which it is entered, unless extended for
good cause shown or unless the party against whom it is entered
consents to an extension for a longer period. A hearing requested
concerning an order entered under this paragraph shall be held at
the earliest possible time, and prior to the expiration of the tempo-
rary order.
(3) The court may receive and consider, at a hearing held pur-
suant to this subsection, evidence and information that would be
inadmissible under the Federal Rules of Evidence.
(e) Upon conviction of a person under this section, the court
shall enter a judgment of forfeiture of the property to the United
States and shall also authorize the Attorney General to seize all
property ordered forfeited upon such terms and cozditions as the
court shall deem proper. Following the entry of an order declaring
the property forfeited, the court may, upon application of the
United States, enter such appropriate restraining orders or
injunctions, require the execution of satisfactory performance
bonds, appoint receivers, conservators, appraisers, accountants,
or trustees, or take any other action to protect the interest of the
United States in the property ordered forfeited. Any income
accruing to, or derived from, an enterprise or an interest in an
enterprise which has been ordered forfeited under this section
may be used to offset ordinary and necessary expenses to the
enterprise which are required by law, or which are necessary to
protect the interests of the United States or third parties.
(f) Following the seizure of property ordered forfeited under
this section, the Attorney General shall direct the disposition of
A-36
the property by sule or any other commercially feasible means,
making due provision for the rights of any innocent persons. Any
property right or interest not exercisable by, or transferable for
value to, the United States shall expire and shall not revert to the
defendant, nor shall the defendant or any person acting in concert
with or on behalf of the defendant be eligible to purchase forfeited
property at any sale held by the United States. Upon application
of a person, other than the defendant or a person acting in concert
with or on behalf of the defendant, the court may restrain or stay
the sale or disposition of the property pending the conclusion of
any appeal of the criminal case giving rise to the forfeiture, if the
applicant demonstrates that proceeding with the sale or disposi-
tion of the property will result in irreparable injury, harm or loss
to him. Notwithstanding 3] U.S.C. 3302(b), the proceeds of any
sale or other disposition of property forfeited under this section
and any moneys forfeited shall be used to pay all proper expenses
for the forfeiture and the sale, including expenses of seizure,
maintenance and custody of the property pending its disposition,
advertising and court costs. The Attorney General shall deposit in
the Treasury any amounts of such proceeds or moneys remaining
after the payment of such expenses.
(g) With respect to property ordered forfeited under this sec-
tion, the Attorney General is authorized to —
(1) grant petitions for mitigation or remission of forfeiture,
restore forfeited property to victims of a violation of this chap-
ter, or take any other action to protect the rights of innocent
persons which is in the interest of justice and which is not incon-
sistent with the provisions of this chapter;
(2) compromise claims arising under this section;
(3) award compensation to persons providing information
resulting in a forfeiture under this section;
A-37
(4) direct the disposition by the United States of all property
ordered forfeited under this section by public sale or any other
commercially feasible means, making due provision for the
rights of innocent persons; and
(5) take appropriate measures necessary to safeguard and
maintain property ordered forfeited under this section pending
its disposition.
(h) The Attorney General may promulgate regulations with
respect to —
(1) making reasonable efforts to provide notice to persons
who may have an interest in property ordered forfeited under
this section;
(2) granting petitions for remission or mitigation of forfeit-
ure,
(3) the restitution of property to victims of an offense peti-
tioning for remission or mitigation of forfeiture under this
chapter;
(4) the disposition by the United States of forfeited property
by public sale or other commercially feasible means;
(S) the maintenance and safekeeping of any property for-
feited under this section pending its disposition; and
(6) the compromise of claims arising under this chapter.
Pending the promulgation of such regulations, all provisions of
law relating to the disposition of property, or the proceeds from
the sale thereof, or the remission or mitigation of forfeitures for
violation of the customs laws, and the compromise of claims and
the award of compensation to informers in respect of such forfeit-
—
A-38
ures shall apply to forfeitures incurred, or alleged to have been
incurred, under the provisions of this section, insofar as applica-
ble and not inconsistent with the provisions hereof. Such duties as
are imposed upon the Customs Service or any person with respect
to the disposition of property under the customs law shall be per-
formed under this chapter by the Attorney General.
(i) Except as provided in subsection (7), no party claiming an
interest in property subject to forfeiture under this section may —
(1) intervene in a tria! or appeal of a criminal case involving
the forfeiture of such property under this section; or
(2) commence an action at law or equity against the United
States concerning the validity of his alleged interest in the prop-
erty subsequent to the filing of an indictment or information
alleging that the property is subject to forfeiture under this sec-
tion.
(j) The district courts of the United States shall have jurisdic-
tion to enter orders as provided in this section without regard to
the location of any property which may be subject to forfeiture
under this section or which has been ordered forfeited under this
sectiuii.
(k) In order to facilitate the identification or location of prop-
erty declared forfeited and to facilitate the disposition of petitions
for remission or mitigation of forfeiture, after the entry of an order
declaring property forfeited to the United States the court may,
upon application of the United States, order that the testimony of
any witness relating to the property forfeited be taken by deposi-
tion and that any designated book, paper, document, record,
recording, or other material not privileged be produced at the
same time and place, in the same manner as provided for the tak-
ing of depositions under Rule 15 of the Federal Rules of Criminal
Procedure.
a
(11) Following the entry of an order of forfeiture under this
section, the United States shall publish notice of the order and of
its intent to dispose of the property in such manner as the Attorney
General may direct. The Government may also, to the extent
practicable, provide direct written notice to any person known to
have alleged an interest in the property that is the subject of the
order of forfeiture as a substitute for published notice as to those
persons so notified.
A-39
(2) Any person, other than the defendant, asserting a legal
interest in property which has been ordered forfeited to the United
States pursuant to this section may, within thirty days of the final
publication of notice or his receipt of notice under paragraph (1),
whichever is earlier, petition the court for a hearing to adjudicate
the validity of his alleged interest in the propert,. The hearing
shall be held before the court alone, without a jury.
(3) The petition shall be signed by the petitioner under penalty
of perjury and shall set forth the nature and extent of the petition-
er’s right, title, or interest in the property, the time and circum-
stances of the petitioner's acquisition of the right, title, or interest
in the property, any additional facts supporting the petitioner's
claim, and the relief sought.
(4) The hearing on the petition shall, to the extent practicable
ard consistent with the interests of justice, be held within thirty
days of the filing of the petition. The court may consolidate the
hearing on the petition with a hearing on any other petition filed
by a person other than the defendant under this subsection.
(S) At the hearing, the petitioner may testify and present evi-
dence and witnesses on his own behalf, and cross-examine wit-
nesses who appear at the hearing. The United States may present
evidence and witnesses in rebuttal and in defense of its claim to
the property and cross-examine witnesses who appear at the hear-
AO
ing. In addition to testimony and evidence presented at the hear-
ing, the court shall consider the relevant portions of the record of
the criminal case which resulted in the order of forfeiture.
(6) If, after the hearing, the court determines that the peti-
tioner has established by a preponderance of the evidence that —
(A) the petitioner has a legal right, title, or interest in the
property, and such right, title, or interest renders the order of
forfeiture invalid in whole or in part because the right, title, or
interest was vested in the petitioner rather than the defendant
or was superior to any right, title, or interest of the defendant at
the time of the commission of the acts which gave rise to the
forfeiture of the property under this section; or
(B) the petitioner is a bona fide purchaser for value of the
right, title, or interest in the property and was at the time of
purchase reasonably without cause to believe that the property
was subject to forfeiture under this section;
the court shall amend the order of forfeiture .. accordance with its
determination.
(7) Following the court's disposition of all petitions filed under
this subsection, or if no such petitions are filed following the
expiration of the period provided in paragraphs (2) for the filing
of such petitions, the United States shall have clear title to prop-
erty that is the subject of the order of forfeiture and may warrant
good title to any subsequent purchaser or transferee.
(n) If any of the property described in subsection (a), as a
result of any act of omission of the defendant —
(1) cannot be located upon the exercise of due diligence;
(2) has been transferred or sold to, or deposited with, a third
party,
A-41
(3) has been placed beyond the jurisdiction of the court;
(4) has been substantially diminished in value; or
(5) has been commingled with other property which cannot be
divided without difficulty;
the court shall order the ‘orfeiture of any other property of the
defendant up to the value of any property described in paragraphs
(1) through (5).
A-42
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
Alexandria Division
UNITED STATES OF AMERICA
v. Criminal No. 87-00208-A
DENNIS E. PRYBA, et al.
MEMORANDUM OPINION
"n roduction
This twelve count RICO-obscenity prosecution is the latest
chapter in the continuing First Amendment-pornography saga. !
The new twist here is the use of RICO,’ indeed apparently the
first federal prosecutorial use of RICO against purveyors of alleg-
edly obscene materials.’ Until 1984, federal prosecutors target-
ting smut had an arsenal limited chiefly to 18 USC §§ 1461 et seq.
Then, in 1984, Congress expanded RICO to cover obscene mate-
rials. It did so based on a concern that organized crime was con-
tributing to and profiting from an “explosion in the volume and
availability of pornography in our society.’* As a result, federal
prosecutors inay now use RICO’s stiffer penalties and forfeiture
| See generally F. Schauer, The Law of Obscenity (1976).
2 Racketeer Influenced & Corrupt Organizations Act, 18 U.S.C. §§ 1961-68
(1984).
3 State prosecutions under state RICO statutes apparently antedate federal
efforts. See 4447 Corp. v. Goldsmith, 479 N.E.2d 578 (Ind. App. 1985),
vacated, 304 N.E.2d 559 (Ind. 1987); Arizona v. Feld, No. 148389 (Ariz. Ct.
App. 1987); Western Business Sys., Inc. v. Slaton, 492 F.Supp 513 (N.D.Ga.
1980) (applying Georgia RICO statute).
* 130 Cong. Rec. 5434 (Jan. 30, 1984) (remarks of Senator Helms); Russello v.
United States, 464 U.S. 16, 26 (1938) (RICO’s “purpose is to provide new
weapons of unprecedented scope for an assault upon organized crime and its
economic roots.’’}.
A-43
provisions® against sellers and distributors of allegedly obscene
materials. This case is just such an attempted prosecution and
this Memorandum considers and decides several dispositive
threshold motions made by defendants.
Roth v. United States, 354 U.S. 476 (1957) and Miller v. Cali-
fornia, 413 U.S. 15 (1973) are perhaps the most important of the
earlier chapters in the first Amendment-pornography saga. Roth
made unmistakably clear that obscenity was not constitutionally
protected speech and provided a standard by which to discern
obse nity, namely whether the average person,” applying contem-
5 RICO’s criminal penalties provide that whoever violates any provisions of
RICO “shall be fined not more than $25,000 or imprisoned not more than
twenty years, or both.” 18 U.S.C. § 1963(a) (1982 & Supp. 1984).
RICO's forfeiture provisions provide that a person convicted of a RICO
offense shall forfeit to the United States:
(1) any interest the person has acquired or maintained in violation of sec-
tion 1962 (“Prohibited activities”’};
(2) any—
(A) interest in;
(B) security of;
(C) claim against; or
(D) property or contractual right of any kind affording a source of influ-
ence over: any enterprise which the person has established, operated, con-
trolled, conducted, or participated in the conduct of, in violation of section
1962; and
($i any property constituting, or derived from, any proceeds which the per-
son obtained, directly or indirectly, from racketeering activity or unlawful
debt collection in violation of section 1962.
18 U.S.C. § 1963(aW 1984).
6 In deciding whether the material appeals to a prurient interest, the jury must
avoid subjective personal or private views. The average person is the judge and
not the obiect of the test. The jury must evaluate what judgment will be made
by s hypothetical average person applying the collective view of the adult com-
munity. Pinkus v. United States, 436 U.S. 293, 300-01 (1978). The Court in
Pinkus held that “children are not to be included ... as part of the ‘communi-
ty.” " Id. at 297; see also Brockett v. Spokane Arcades, 105 S.Ct. 2794 (1985).
In addition, there is no requirement that the average person be sexually
aroused or excited by the material. L’nited States v. Gugliemi, 819 F.2d 45}
(4th Cir. 1987).
A-+4
porary community standards, ‘ would find that the work, taken as
whole, appeals to the prurient interest.* This test predictably
spawned more than a decade of spirited and confusing decisions.
In 1973, in an effort to redirect the course of the law in this area.
the Court, in Miller v. California, rephrased and expanded the
Roth test.’ Justice Brennan, who as the author of Roth had argu-
ably initiated this judicial odyssey, '’ was so disillusioned by the 15
or so years of judicial wanderings under Roth that at length, he
9
The “contemporary community standard” is to be applied by the jury only
when examining the first two prongs of Miller, namely the ‘prurient appeal"
and “patent offensiveness’’ prongs. See infra note 22 (discussing the three -
prong Miller test). The third prong of Miller, the “serious literary, artistic,
political, or scientific value’ prong, is determined not by the application of
the contemporary community standard, but rather by the traditional “rea-
sonable man” standard. See Pope v. Illinois, 107 S.Ct. 1918 (1987).
In Roth v. United States, 354 U.S. 476 (1957), the Court defined “prurient
interest’’ as follows:
A thing is obscene if, considered as a whole. its predominant appeal is to
prurient interest, i.e., a shameful or morbid interest in nudity, sex, or
excretion, and if it goes substantially beyond customary limits of candor in
description or representation of such matters. ...
Id. at 487 n.20. It is evident that the Court saw no significant difference
between the A.L.I. Model Penal Code definition of “prurient” (shameful or
morbid}, and the meaning of “prurient” as it had been developed in the case
law (lustful and lascivious) up to 1957. It is worth noting that the comments to
the Model Penal Code make it clear that “prurient” is not limited to “shame-
ful’ or ‘morbid’, but encompasses a broader use of those terms.
Miller clarified the law in several respects, including principally (a) the aban-
donment of the “utterly without redeeming value” standard announced in
Memoirs v, Massachusetts, 383 U.S. 413 (1966), and (b) the rejection of a
national standard for the community. The former imposed an unrealistic bur-
den on the prosecutor, while the latter simply made the common sense point
that citizens of Virginia or Wisconsin may well not be willing to find accept-
able depictions of sexual conduct that would be acceptable to citizens of Las
Vegas or New York.
Some choose to trace the original of the saga to Chaplinsky v. New Hamp-
shire, 315 U.S. 568 (1942) which originated the “fighting words” doctrine
and listed obscenity among the types of speech unprotected by the First
Amendment.
A-45
dissented in Miller and its companion case, preferring instead an
absolutist, ‘anything goes” approach to obscenity. Chief Justice
Burger, on the other hand, persuaded a majority in Miller to carry
on and refine the Roth effort to draw a line between obscenity and
protected speech. Given that the instant case is the latest chapter
in this saga, it is perhaps only fitting that the juxtaposed views of
Justice Brennan and Chief Justice Burger serve here as a preface.
Thus, in dissenting in Paris Adult Theatre I v. Slaton, 413 U.S.
49 (1973), a Miller companion, Justice Brennan noted that the
effort to distinguish between protected and unprotected sexually
oriented material, born of Roth, had proved so vexing, so time-
consuming, and so divisive and had generated such disharmony
of views!! that the effort should be abandoned. As he put it, even
after all this effort, the subject stubbornly “remained ... resistant
to the formation of stable and manageable standards.” 413 U.S. at
73." Chief Justice Burger disagreed, noting in Miller that the
convenient, anything goes, absolutist approach is not the law and
that the “Court must face up to the tough problem of constitu-
tional judgment involved in every obscenity case.’ 413 U.S. at 29-
30 (quoting Roth, 354 U.S. at 498). So in the spirit of the former
Chief Justice’s words, this court now faces up to “the tough prob-
lems of constitutional judgment”’ raised in this novel obscenity
case.
!! The best known, most memorable, and arguably, most candid comment
made on the post-Roth the line-drawing difficulties in obscenity cases was
Justice Stewart's in a concurring opinion in Jacobellis v. Ohio, 378 U.S. 184
(1964). He noted that the hard core pornography that was unprotected under
the Constitution might be impossible to define but, he said, “I know it when I
see it.”” Id. at 197.
12. Justice Harlan was moved to describe as “intractable” the judgment required
and the problems raised in obscenity litigation. Interstate Circuit, Inc. v.
City of Dallas, 390 U.S. 676, 704 (1968) (Harland, J., dissenting).
A-46
The Indictment
The indictment consists of twelve counts plus a number of
RICO forfeiture allegations. Of the twelve counts, three allege
RICO obscenity violations, while the nine remaining counts
charge felony obscenity violations under 18 U.S.C. §§ 1461 et.
seq. The motions considered in this Memorandum Opinion focus
solely on the three RICO counts and the accompanying forfeiture
allegations.
Count I charges defendants, Dennis E. Pryba, Barbara A.
Pryba, Jennifer G. Williams and Educational Books, Inc., with
participating as principals in a “pattern of racketeering” involv-
ing the sale and distribution of allegedly obscene materials and
with investing the proceeds of such activities in an “enterprise”
engaged in interstate commerce, in violation of 18 U.S.C.
§ 1962(a). The enterprise is said to consist of the Prybas, Wil-
liams, Educational Books and seven unindicted corporations.
Count II alleges that Pryba and Williams, as persons employed
by and associated with the enterprise, violated 18 U.S.C.
§ 1962(c) by conducting the affairs of the enterprise through a
pattern of racketeering activity. And in Count III, the Prybas,
Williams and Educational Books are charged with a Section
1962(c) conspiracy to violate section 1962(a).
Defendants mount a two-prong attack on the RiCO counts in
the indictment. First, defendants argue three pleading points.
Defendants assert that Counts I, II and III do not properly plead
an “enterprise”, as required by RICO. Next, the defendants
claim that the government has not sufficiently alleged a pattern of
racketeering activity. Finally, one defendant, Educational Books,
asserts that it must be dismissed from Count III because a corpo-
ration cannot be guilty of conspiring with its agents when the
agents are alleged to have used the corporation to carry out their
own purposes. Second, they contend these counts should be dis-
A47
missea because the RICO’s forfeiture provisions run afoul of the
Constitution when applied to allegedly obscene materials. '? Spe-
cifically, defendants allege that RICO’s forfeiture provisions: (1)
have a ‘‘chilling”’ effect upon the distribution of protected speech;
(2) act as a prior restraint on protected speech; (3) are unduly
harsh and thus violate the Eighth Amendment; (4) violate due
process principles; and (5) violate the ex post facto clause of the
Constitution. Each of these contentions is separately treated.
Facts and Proceedings to Date
Defendants, Dennis E. Pryba, Barbara A. Pryba, Jennifer G.
Williams, and Educational Books, Inc., own and operate or
assist in operating a number of retail video stor -; that sell alleg-
edly obscene material. On August 13, 1987, defendants were
indicted on various counts under federal RICO alleging, inter
alia, a pattern of racketeering activity involving dealing in
obscene matter. '*
On August 13, 1987, an ex parte restraining order was issued
that enjoined defendants from selling, encumbering, or in any
other way disposing of certain property that might be forfeitable
!3. This court is not faced with the question of whether the restraining order is
unconstitutional. This matter was addressed and decided by another Judge of
this Division when defendants moved to dismiss the restraining order on Sep-
tember 4, 1987. :
'* RICO was amended in 1984 io include dealing in obscene matter” as a rack-
“Racketeering activity’ means any act or threat involving ... dealing in
obscene matter. ... which is chargeable under state law and punishable by
imprisonment for more than one year....
18 U.S.C. 1961/1 WA).
A-48
under RICO’s forfeiture provisions.'° In addition, the August 13
restraining order prohibited defendants from selling all video
tapes, magazines, and other printed material. This order, how-
ever, was modified on August 25, 1987. The modified order per-
mitted defendants to continue to conduct their business as norma!
‘without substantially dissipating or diminishing the value of the
assets’ of their business or p i
The Pleading Issues
A. The RICO “Enterprise”
Defendants argue that the enterprise alleged in the indictment
does not meet the statutory definition. The alleged enterprise con-
sists of individuals and corporations. In defendant's view, the
statutory definition of ‘enterprise’ precludes lumping together
individuals and corporations. See 18 U.S.C. § 1961/4). Defend-
ants claim that only enterprises composed solely of individuals or
solely of other entities are statutorily permitted. The RICO
counts of the indictment are thus said to be fatally defective. The
Court disagrees; defendant's reading of the statute does violence
\5 The restraining order provided, in part, that defendants were prohibited
from disposing of certzin real property, automobiles, bank accounts, stocks,
and other personal property that might be forfeitable under RICO. Title 18
U.S.C. § 1963(a) provides for three types of forfeiture: (1) any interest
acquired or maintained in violation of § 1962; (2) any property affording a
source of influence over the enterprise; and (3) any property derived from the
proceeds of racketeering activity. If defendants are found to be guilty of deal-
ing in obscene matter, then the real and personal property described in the
restraining order might be forfeitable under section 1963(a).
6 The modified order, dated August 25, 1987, provided that defendants ‘shall
be permitted to conduct |their| business as normal without substantially dissi-
pating or diminishing the value of the assets of the property described ... in
the original restraining order.’ Defendants were permitted to carry on their
business using a specific bank account.
The modified order also permitted defendants the use of funds for ‘ reason-
able attornevs fees.” The Court has instructed defense counsel to maintain a
careful accounting of all fees received.
A-49
to the plain meaning of the statutory definition of “enterprise”
and, moreover, is contrary to well-reasoned authority.
Section 1961(4) states that “ ‘enterprise’ in_ludes any individ-
val, partnership, corporation, association, or other legal entity,
and any union or group of individuals associated in fact although
not a legal entity’ (emphasis added). This is sweeping language;
there is no reason to give it a strained, restricted scope. Legislative
history confirms this. The House RICO report stated that “‘enter-
prise” included
associations in fact, as well as legally recognized associative
entities. Thus infiltration of any associative group by any
individual or group capable of holding a property interest
can be reached.
House Rep. No. 91-1549, 91st Cong., 2d Sess., 1970 U.S. Code
Cong. & Ad. News 4007, 4032 (emphasis added).'’ The Supreme
Court, in another context, has also recognized the expansiveness
of the term “enterprise”. In United States v. Turkette, 452 U.S.
576 (1981), the Court rejected an argument that “enterprises”
should be limited to legitimate business. In reaching this conclu-
sion, the Court noted, “Congress opted for a far broader defini-
tion of the word ‘enterprise.’ *"* It also staied that “‘|[t}here is no
restriction upon the associations embraced by the definition [in
§ 1961(4)].""
'° For further discussion of RICO’s legislative history and purpose, see United
States v. Turkette, 452 U.S. 576, 588-93 (1981) (confirming that Congress
intended to give broad scope to the term “‘enterprise’’).
'8 Turkette, 452 U.S. 576, 593 (1981) (RICO “enterprises” not limited to legiti-
mate business; enterprises may include illegitimate as well as legitimate busi-
nesses}.
'° Id. at 580. This may be a modest overstatement as it appears unlikely that a
state or municipality itself may not be of an enterprise. See United States v.
Mandel, 415 F.Supp. 997 (D. Md. 1976}. supplemented, 415 F.Supp. 1025.
lo accept defendants’ argument that the term ‘‘enterprises”
does not embrace individuals together with other entities, this
Court would have to ignore the plain meaning of the word
“includes” and find that Congress used the word to indicate that
the list following was exhaustive, not merely illustrative. Nothing
warrants such a construction; plain meaning and legislative
intent are to the contrary, as is the sparse, but well-reasoned and
uniform existing authority. The Fifth Circuit in United States v.
Thevis, 665 F.2d 616 (5th Cir. 1982), cert. denied, 459 U.S. 825
(1982) succinctly dealt with this point. It stated:
Appellants contend that because ihe indictment described
the enterprise as ‘a group of individuals associated in fact
with various corporations,” the enterprise alleged did not
fall within the literal bounds of the statutory classifications.
We reject this claim.
*_**
We are convinced ... that RICO covers the enterprise alleged
in this case. Use of the verb “includes”’ in the statutory defi-
nition indicates congressional intent not to limit a RICO
enterprise to the specific categories listed; rather, the lan-
guage “reveals that Congress opted for a far broader defini-
tion of the word ‘enterprise’.
665 F.2d at 625 (quoting United States v. Turkette, 452 U.S. 576,
593 [1981]). The Third Circuit reached the same result, noting
that:
We see no indication that Congress intended to restrict the
definition of ‘‘enterprise’’ to a number of entities or individ-
uals that all fall within the same category.
A-51
United States v. Aimone, 715 F.2d 822, 828 (3d Cir. 1983), cert.
denied, 468 U.S. 1217 (1984).
Defendants argue that a different result should obtain here
because the Fourth Circuit in United States v. Computer Sciences
Corp. [CSC], 689 F.2d 1181 (4th Cir. 1982), cert. denied, 459
U.S. 1105 (1983), commands that the rule of lenity applies in
RICO cases and thus ‘includes’ must be construed strictly. The
case and the rule are inapposite here. CSC dealt with a point not
here presented. It held that an unincorporated division of a corpo-
ration could not be lumped with the corporation to form an
“enterprise. CSC did not address the argument of these defend-
ants. Further, while the rule of lenity undoubtedly applies in
RICO cases in appropriate circumstances, those circumstances
are not present here. This is not a case where fairness and notice
militate in favor of construing an ambiguity with leniency toward
a defendant; rather, this is a case where the plain and ordinary
meaning of the term “includes” does not fairly admit to the con-
struction defendants’ urge.
In sum, CSC is inapposite here. The plain meaning of the lan-
guage defining ‘‘enterprise,”’ the legislative history of the provi-
sion, and all the pertinent authority to date support this Court's
conclusion that a RICO enterprise can consist of individuals
lumped together with corporations or other legal entities.
0 See also United States v. Huber, 603 F.2d 387, 392-94 (2d Cir. 1979), cert.
denied , 445 U.S 927 (1986) (enterprise can include more than one corpora-
tion}.
A-52
B. Pattern of Racketeering Activity
Defendants argue that the three RICO counts do not suffi-
ciently allege the requisite ‘pattern of racketeering activity. ?' In
essence, defendants arguc that the activity alleged in the indict-
ment constitutes a single scheme, not separate acts. This indict-
ment, they claim, is analogous to the one at issue in International
Daia Bank, Lid. v. Zepkin, 812 F.2d 149 (4th Cir. 1987). There
the issuance of a fraudulent prospectus was held to be a single,
unitary scheme, not a RICO pattern of racketeering.
Defendants’ argument is unpersuasive. Zepkin is not in point.
In contrast to the issuance of a prospectus, this indictment alleges
a series of separate but related acts dealing with the sale and dis-
tribution of obscene material. The allegations fit squarely within
RICO, which defines a “pattern” as “at least two acts” and
‘racketeering activity” as including ‘‘dealing in obscene matter.’
18 U.S.C. § 196115), (LMA). The following legislative history
from the RICO Senate Report dispels any doubt that this indict-
ment properly pleads a pattern of racketeering:
The target of [RICO] is ... not sporadic activity. The infil-
tration of legitimate business normally requires more than
one ‘‘racketeering activity” to be effective. It is this factor of
continuity plus relationship which combines to produce a
pattern.
S. Rep. No. 617, 91st Cong., Ist Sess. 158 (emphasis added),
quoted in Sedima, S.P.R.L. v. IMREX Co., Inc., 473 U.S. 479,
496 n.14 (1985). The Fourth Circuit interprets this language to
require that “the predicate acts must be related and must be a
part of a continuous criminal endeavor.’ Zepkin, 812 F.2d at 154.
This indictment, therefore, properly pleads a “pattern of racke-
teering activity.”
21 See 18 U.S.C. § 1961(1),(5), 1962la).(eh.
A-53
C. Conspiracy
The corporate defendant, Educational Books, Inc., asserts
that Count III deserves dismissal because, contrary to the indict-
ment’s allegations, the corporation cannot conspire with its own
agents. In essence, this defendant urges the application in this
context of the civil intracorporate conspiracy rule. See McIntyre's
Mini Computer Sales Group, Inc. v. Creative Synergy Corp... 644
F. Supp. 580, 585 (E.D.Mich. 1986). Dispositive of this claim is
that an exception to the intracorporate conspiracy exists in the
criminal arena. See, e.g., United States v. Peters, 732 F.2d 1004,
1008 (1st Cir. 1984).
The Constitutional Issues
A. Chilling Effect of RICO
Defendants claim that RICO chills protected speech for two
reasons: first, it is said that purveyors will be deterred from deal-
ing in non-obscene erotic literature given the breadth and vague-
ness of the underlying criminal offense, i.e. , obscenity. Second, it
is urged that RICO’s forfeiture provisions are so draconian as to
deter dealers from dealing in protected speech at the margin. In
other words, vague definitions of obscenity force purveyors to
guess about the status of some “‘speech”’ at the margins, and they
will be deterred from such guessing by the risk of criminal prose-
cution and the severity of potential sanctions. The victim, defend-
ants contend, will be protected speech at the margins,
A-S4
presumably erotic works that skirt the bouadary but do not cross
over into the realm of obscenity.~
The gravamen of both prongs of this attack is the alleged exces-
sive vagueness and breadth of the statutory proscriptions, one
state (Va. Code Ann. § 18.2-372), one federal (18 U.S.C. § 1461
et seq.}, that are the predicates for a RICO violation. The short
answer is that both statutes have already passed sonstitutional
muster. They have been found to give “adequate warning of the
conduct proscribed” so as to permit the law to be fairly adminis-
tered. See Roth v. United States, 354 U.S. 476, 491 (1957).
The federal obscenity statute, 18 U.S.C. § 1461 et seq. and its
_predecessors, has passed constitutional muster more than once.»
The same is true of the Virginia analog, Va. Code Ann.
2 The existing border demarcating the line between protected speech and
obscenity is given by Miller v. California, 413 U.S. 15 (1973). Speech may be
banned as obscene where:
‘a! the average person. applying contemporary community standards
would find that the work. taken as a whole. appeals to the prurient interest:
\b) the work describes, in a patently offensive way, sexual conduct defined
by the applicable state law; and
‘c! the work, taken as a whole, lacks serious literary, political, or scientific
value.
413 U.S. at 24. Thus, as J.R. Distributors. Inc. v. Eikenberry, 725 F.2d 482
(%h Cir. 1984), rev d on other grounds sub nom. Brockett v. Spokane
Arcades, 105 S.Ct. 2794 (1985) indicates, works that merely arouse normal
sexual responses (in contrast to shameful or morbid sexual responses! may be
constitutionally protected even if they contain an isolated examp! of a pat-
ently offensive description of sexual conduct and even if the works lack
redeeming value defined in Miller. Eikenberry, 725 F.2d at 490-92. It is. pre-
sumably. this speech that is at risk at the margin.
23 Smith v. United States, 431 U.S. 291 (1977); Hamiing v. United States, 418
U.S. 87 (1974% see, e.g., Roth v. United States. 354 U.S. 476, 491 (1957).
A-55
§ 18.2-3774.** Both frame offenses in language that “‘conveys suf-
ficiently definite warning as to the proscribed conduct when mea-
sured by common understanding and practices ..., give(s]
adequate warning of the conduct proscribed ard mark the
‘boundaries sufficiently distinct for judges and juries fairly to
administer the law. ” Roth v. United States, 354 U.S. at 491-92
(1957) (quoting United States v. Petrilio, 332 U.S. 1, 7-8 (1947)).
To be sure, there may be some fuzziness at the boundaries, but
absolute precision is neither practical nor constitutionally
required.
That there may be marginal cases in which it is difficult to
determine the side of the line on which a particular fact situ-
ation falls is no sufficient reason to hold the language too
ambiguous to define a criminal offense....
Roth, 354 U.S. at 491-92. Defendants’ First Amendment chilling
argument is, therefore, unfounded insofar as it rests on the
alleged vagueness of the underlying obscenity statutes. Both are
adequately precise.
24 There can be little doubt of the cons:itutionality of the Virginia statute as its
language tracks closely the three part test announced in Miller v. California,
413 U.S. 15(1973). The constitutionality of an earlier, less precise version was
upheld in Grove Press, Inc. v. Evans, 306 F.Supp. 1084 (E.D.Va. 1969); see
also Educational Books, Inc. v. Commonwealth, 223 Va. 392, 323 S.E.2d 84
(1984).
A somewhat different question is presented by the application
of RICO forfeiture remedies in obscenity prosecutions. So draco-
nian are they, the defendants claim, that the unconstitutional
chilling that occurs is tantamount to a prior restraint.» The court
turns next to this argument.
B. Prior Restraint
Defendants argue that RICO’s forfeiture provisions (18 U.S.C.
§ 1963) operate in alleged obscenity cases, as here, as impermissi-
ble prior restraints. Heavy reliance is placed on Near v. Minne-
sota, 283 U.S. 697 (1931) and its progeny which make
unmistakably clear the courts’ hostility toward prior restraints.
The flaw in this argument is the recognized distinction between
prior restraints and subsequent punishment. The evil of a prior
restraint is that speech is suppressed before its status is judicially
determined. Such restraints are far more likely to chill, indeed to
suppress, free speech tl.an subsequent punishment, which can be
imposed only after there is the procedural safeguard of a disinter-
ested judicial determination concerning the alleged illegality. A
person is punished for speech-related conduct only after he is
given the opportunity to litigate, inter alia, the constitutionality of
the statute, either facially or as applied to him. In obscenity cases,
he is also permitted to present the material to a jury and attempt to
persuade it, under Miller, that the material deserves constitu-
tional protection. Prior restraints deprive “speakers” of these
important safeguards. Thus it is that prior restraints are disfa-
25 A “prior restraint” is defined as “the imposition of a restraint on a publica-
tion before it is published.” B'ack’s Law Dictionary 1074 (Sth ed. 1979).
Courts often use the terms “pric restraint” and “chilling effect” inter-
changeably. See, e.g., Arizona v. Feld, No. 148289 (Ariz. Ct. App. 1987). Yet
“chilling effect’’ refers to the distribution of material, not publication.
Although a statute may not amount to a prior restraint on publication, it may
cause a chilling effect on distribution. See United States v. John Doe (Model
Magazine), No. 86-5159 (4th Cir. Sept 24, 1987).
A-57
vored and come into court “bearing a heavy presumption against
... [their] constitutional validity.” Bantam Books, Inc. v. Sul-
livan, 372 U.S. 58, 70 (1963).** Such restraints operate to compel a
“speaker” to forego his First Amendment rights.
This is not to say that subsequent punishment schemes such as
RICO's forfeiture scheme have no chilling effect whatever. Surely
it has some; indeed, it is designed to accomplish just that end. But
this “chilling” is a wholly legitimate consequence of the RICO
forfeiture provisions or any other criminal penalty.?’ Deterrence
(or chilling) through the threat of prosecution and punishment is
a legitimate goal of the criminal law. Once it is decided that
obscenity does not merit First Amendment protection and
indeed, once it is decided that obscenity is so pernicious that it
should be criminally proscribed, then a subsequent punishment,
like RICO’s forfeiture scheme, is a sensible and wholly legitimate
law enforcement weapon. It is specially designed to chill or deter
proscribed, unprotected speech; unconstitutional chilling occurs
20 It is worth noting that judicial antipathy toward prior restraints does not
mean that all such restraints are per se unlawful. Even Near recognized there
might be ‘exceptional cases" in which a prior restraint might be lawful. The
Count gave as examples publication of sailing dates of naval ships und the
number and location of troops. 283 U.S. at 716; see also Freedman v. Mary-
land, 380 U.S. 51 (1965) (occasions exist where prior restraint may be
imposed so long as the censor’s judgment is subject to immediate court scru-
tiny).
7 One commentator argues the contrary. See Mayton, Toward A Theory of
First Amendment Process: Injunction of Speech, Subsequent Punishment,
and the Costs of the Prior Restraint Doctrine, 67 Cornell L. Rev. 245 (1982).
But see Redith, The Proper Role of the Prior Restraint Doctrine in First
Amendment Theory, 70 Va. L. Rev. 53 (1983).
A-58
only if the definition of obscenity is excessively broad or vague so
that some protected speech is unintentionally ensnared in the
imprecise net that is cast.”
Nor is it significant that the forfeiture penalty may impact
adversely on defendants’ future speech. That fact alone does not
mean that the First Amendment is implicated. The Constitution
does not forbid punishment for a crime simply because that pun-
ishment might affect free expression. As the Court in Acara v.
Cloud Books, 106 S.Ct. 3172, 3178 (1986) pointed out,
book selling is an establishment used for prostitution [or dis-
tribution of obscene materials] does not confer First Amend-
ment coverage to defeat a valid statute aimed at penalizing
and terminating illegal uses of premises.
28 Defendants cite J.R. Distributors. Inc. v. Eikenberry, 725 F.2d 482 (9h Cir.
1984), rev'd on other grounds sub nom. Brokett v. Spokane Arcades, 105
S.Ct. 2794 (1985), in support of their claim that RICO punishes protected
speech. There, the Ninth Circuit held unconstitutional a state statute that
permitted a fine to be imposed against a defendant found guilty of dealing in
obscene matter. Such a fine was to be based, in part. on profits made from the
sale of protected as well as unprotected material. The court applied “the
familiar requirement that statutes punishing expressive conduct ‘must be
carefully drawn ... to punish only unprotected speech and not be suweptible
of application to protected expression. " Id. at 494 (quoting Gooding v.
Wilson, 405 U.S. 518, 522 (1972)). Yet, Eikenberry is inapposite. There, no
nexus was required between the sale of obscene matter and protected speech.
A defendant could be fined for the profits made on protected matter simply
because obscene material was also sold in the same place of business. RICO
forfeiture, however, requires a nexus between the sale of obscene matter and
protected material. Profits from the sale of protected material may be for-
feited only if they are traceable to the sale of obscene matter. Thus, RICO
does not punish the sale of protected speech; rather, the provisions act in per-
sonam to punish a guilty defendant. ‘*|P]roperty forfeitable under RICO
need not be ‘guilty. RICO forfeiture is aimed at divorcing guilty persons from
the enterprises they have corrupted.’ United States v. Cauble, 706 F.2d 1322,
1350 (Sth Cir. 1983).
A-59
In summary, an attack on the RICO forfeiture provisions as a
prior restraint misses the mark.” Subsequent punishments are
simply not prior restraints. They are applied only after the due
process of a criminal trial and whatever chilling effect they may
have is legitimate and intended.”
Only meager authority exists on the constitutionality of RICO
or RICO-type forfeiture provisions in obscenity cases. What does
exist, however, supports this court’s conclusion that RICO’s for-
feiture provisions do not operate to offend the First Amendment
in obscenity cases. The sole federal case is Western Business Sys-
tems, Inc. v. Slaton, 492 F.Supp. 513 (N.D.Ga. 1980), which
rejected a claim that Georgia's RICO forfeiture provisions consti-
tuted an impermissible prior restraint on protected speech.
There, plaintiffs, purveyors of sexually explicit material, sought
to enjoin prospective obscenity prosecutions under the Georgia
29 Defendants also cite a recent Fourth Circuit decision, United States v. John
Doe (Model Magazine), Nos. 86-5159, 86-5171, 86-5173 (Sept. 24, 1987), in
support of their claim that RICO’s forfeiture provisions are unconstitutional.
This reliance is misplaced; Model Magazine is inapposite. There. the court
held that a subpoena impermissibly ‘‘chilled’’ protected speech. Specifically,
the subpoena demanded all video tapes depicting a broad range of sexual
activity. So worded it was manifestly overbroad. It crossed the Miller-Roth
line. Thus, that court reasoned that movie sellers would simply self-censor
protected as well as unprotected material because the subpoena was exces-
sively broad.
RICO is not overly broad in scope; it “chills” only the distribution of
unprotected expressions; a dealer need only self-censor obscene matter to
avoid RICO’s forfeiture penalties. This type of chilling or self-censorship is
constitutionally permissible and Congress manifestly intended that it occur.
3% This does not mean that subsequent punishment is wholly immune from con-
stitutional attack; it is only immune from attack on the ground that it is a
prior restraint. Subsequent punishment may be vulnerable on other grounds.
See Landmark Communications, Inc. v. Virginia, 435 U.S. 829 (1978) (pun-
ishment for release of information concerning confidential investigation of a
judge struck down on First Amendment grounds).
A-60
RICO statute on the ground that forfeiture of property acquired
with racketeering proceeds amounted to a prior restraint on pre-
sumptively protected speech.
The Georgia RICO forfeiture provisions, like those of the fed-
eral statute, make subject to forfeiture all property ‘of whatever
nature, no matter how inoffensive, if it is acquired with racketeer-
ing proceeds.” Jd. at 514. The point to be kept in mind, as that
court saw it, is that:
Forfeiture could apply to any chattel whatever, if it was
acquired with the proceeds of racketeering. Thus, if the
items seized are books or movie films, the seizure is totally
unrelated to their contents. they would be forfeited under the
statute not because of any likelihood of obscenity, but
because they were personal property realized through or
derived from crime.
Id. Ultimately, the court in Western Business Svstems refused an
injunction, concluding that ‘‘plaintiffs’ arguments regarding the
forfeiture provisions are inadequate to create a genuine suppres-
sion of speech issue.” Id.
The Indiana Supreme Court reached a similar result in 4447
Corp. v. Goldsmith, 504 N.E.2d 559 (Ind. 1987), a case involving
the Indiana RICO statute. That court, noting a dearth of perti-
nent authority, found Western Business Systems persuasive and
ruled that the Indiana RICO, patterned after the federal act, was
not an unconstitutional prior restraint. In th words of that court,
We agree with ... [Western Business Systems’] reasoning
that the purpose of the forfeiture provisions is totally unre-
lated to the nature of the assets in question. The overall pur-
pose of the anti-racketeering laws is unequivocal, even
where the predicate offense alleged is a violation of the
obscenity statute. The remedy of forfeiture is intended not to
restrain the future distribution of presumptively protected
A-6l
speech but rather to disgorge assets acquired through racke-
teering activity. Stated simply, it is irrelevant whether assets
derived from an alleged violation of the RICO statute are or
are not obscene.
4447 Corp., 504 N.E.2d at 565.
The third and most recent pertinent decision is Arizona v. Feld,
No 148389 (Ariz. Ct. App. 1987). There, an Arizona appellate
court struck down portions of the Arizona forfeiture provisions
insofar as they purported to reach property essentially uncon-
nected with the racketeering activity.*' Such provisions are not
3! In doing so, the Arizona court criticized the Indiana Supreme Court's deci-
sion in 4447 Corp. v. Goldsmith, 504 N.E.2d 559 (Ind. 1987), opting instead
to follow the Indiana intermediate appellate court decision at 479 N.E.2d 578
(1 The latter court had invalidated the Indiana RICO provisions as
a) .0 obscenity on grounds that they were prior restraints on putatively
protected speech and for failure to comply with procedural safeguards and to
use less restrictive means. The Indiana Supreme Court vacated this ruling.
This court does not find persuasive. and therefore does not follow, the reason-
ing of the Indiana appellate court in 4447 Corp. or that of the Arizona appel-
late court in Feld insofar as either decision is contrued to invalidate forfeiture
provisions extending only to assets that are involved in or are the fruits of the
siders and decides here that such RICO forfeiture provisions are not imper-
or decide whether the specific pre-conviction seizu 2 activities under the for-
feiture provisions in this case permissible or impermissibly prevented the cir-
culation of presumptively protected materials. See supra note 13. This
seemed to be the focus of the Indiana appeals court as the state had padlocked
the stores, seized books, magazines. films and the like only a relatively small
part of which had been alleged to be obscene. Thus. the focus of the Indiana
appellate court de -ision seemed to be the specific pre-conviction application
of the RICO provisions in that case. No such seizure and padlocking are here
in issue. Rather, the issue presented here is whether the RICO forfeiture pro-
visions. construed to extend only to ill-gotten gains of the racketeering activ-
ity, are facially unconstitutional as prior restraints on protected speech.
A-2
here in issue.” Significantly, however, that court upheld those
portions of the Arizona statute that most closely resemble the
RICO forfeiture provisions. The forfeiture provisions upheld in
Feld, Arizona Code § 13-2314(D\(6), are essentially similar to
RICO’s and provide as follows:
6. Forfeiture to the general fund of the state or county as
appropriate to the extent not already ordered to be paid in
other damages:
(al Any property or other interest acquired or maintained
by a person in violation of § 13-2312.
(b) Any interest in, security of, claims against or property,
office, title, license or contractual right of any kind affording
a source of influence over any enterprise or other property
82 The Arizona RICO post-conviction remedies held unconstitutional in Feld
are as follows:
(1) Ordering any person to divest himself of any interest, direct or indirect.
in any enterprise.
(2) Imposing reasonable restrictions on the future activities or investments
of any person....
(3) Ordering dissolution or reorganization of any enterprise.
Ariz. Rev. Stat. Ann. § 13-2314 (DW1)}-43).
These provisions are identical to the RICO civil penalties set forth in 18
U.S.C. § 19641a). Yet the constitutionality of RICO’s civil penalties is not in
issue here: this is a criminal proceeding. Even assuming these civil penalties
fail. There exists ‘the elementary principle that the same statute may in part
be constitutional! and in part unconstitutional, and that if the parts are wholly
independent of each other, that which is constitutional may stand and that
which is unconstitutional may be rejected.” Allen v. Louisiana, 103 U.S. 80.
83-84 (1881), quoted in Brockett v. Spokane Arcades, Inc. , 472 U.S. 491, 502
(1985); see also Feld, slip. op. at 144. Thus, the Court need not and will not
address the constitutionality of RICO's civil penalties as they apply to
obscenity cases. This Court is well aware of “the cardinal rules governing the
federal courts: ‘|o}ne, never to anticipate a question of constitutional law in
advance of the necessity of deciding it; the other never to formulate a rule of
constitutional law broader than is required by the precise facts to which it is to
be applied. “ Brockett, 472 U.S. at 30] (quoting United States v. Raines. 362
U.S. 17, 21 (19600.
A-03
which a person has acquired or maintained an interest in or
control of, conducted or participated in the conduct of in vio-
lation of § 13-2312.
(c) All proceeds traceable to an offense included in the defi-
nition of racketeering in § 13-2301, subsection D, para-
graph 4 and all monies, negotiable instruments, securities,
property and other things of value used or intended to be
used to facilitate commission of the offense.
The Arizona court approved these forfeiture provisions stating:
The remedy in subsection (D(6}—forfeiture of interests or
proceeds—is proper to the extent that the obscene materials
themselves, or proceeds from materials determined to be
obscene, m~y be seized. Also, as held in Western Business
Systems, items of the enterprise could be forfeited if they
were gains from other racketeering activity. Racketeering
proceeds cannot be laundered merely bv being invested i
Feld, slip op. at 140-4] (emphasis added).
Further support exists for this Court's holding that RICO's for-
feiture provisions do not act as an unconstitutiona! prior
restraint. The Sixth Circuit, in 5]] Detroit Street v. Kelley, 807
F.2d 1293 (6th Cir. 1986). held that a state obscenity law, which
imposed very large fines for obscenity violations, was not an
unconstitutional prior restraint on expression. There, Michigan's
obscenity iaws provided for a $100,000 fine for a first offense and
a mandatory $50,000 to $5,000.000 fine for a subsequent offense.
The district court reasoned that the large fines made the statute
“the equivalent of an unconstitutional padlocking or closure law.’
Id. at 1298 (citations omitted). On appeal, the Sixth Circuit
reversed the disirict court, stating:
We refuse to hold that a statute threatening fines that could
impair the operation of a business is an impermissible prior
restraint on expression, even where that business also
A-64
involves dissemination of protected materials. The fact that
a person does some business disseminating protected materi-
als cannot immunize that person from large fines that may
be imposed for violation of criminal law.
Id. at 1299.
In summary, this Court concludes that principle and authority
confirm that RICO’'s forfeiture provisions, construed to reach the
ill-gotten gains of racketeering activity, are not facially invalid
prior restraints on protected speech.
The heart of this matter is that Congress has found that orga-
nized crime uses and exploits obscenity to further its pernicious
aims and, therefore, that a pattern of racketeering activity
observed deserves the forfeiture sanction. The fact that the racke-
teering activity involves expressive conduct is irrelevant. The
First Amendment cannot be a shield for illegal activity. RICO's
forfeiture provisions are not more of a restraint on free speech
than is any felony conviction or prison sentence. Both of the latter
are provisions that in some respect restraint speech but neither
can be coherently termed a First Amendment violation. Logic
dictates the same conclusion for RICO’s forfeiture provision. The
forfeiture remedy, properly construed and applied, does not
impermissibly restrain further dissemination of speech, but
rather simply requires those engaged in racketeering acts to dis-
gorge their ill-gotten gains.
C. Eighth Amendment
Defendants claim that RICO's forfeiture provisions constitute
excessive fines or cruel and unusual punishment in violation of
the Eighth Amendment. Neither argument is persuasive. On
their face and construed to reach only racketeering’s ill-gotten
gains, the forfeiture provision seem eminently apt and suitable to
their undoubtedly legitimate purpose. As such, they are neither
A-65
excessive fines, nor cruel and unusual punishment. The Fourth
Circuit confirmed this conclusion in United States v. Grande, 620
F.2d 1026 (4th Cir.), cert. denied, 449 U.S. 830 (1980). It found
that
The magnitude of [RICO] forfeiture is directly keyed to the
magnitude of the defendant's interest in the enterprise con-
ducted in violation of the law. Accordingly, we conclude that
it is not cruel and unusual in the constitutional sense.
Id. at 1039." On its face. therefore, the RICO forfeiture sanction
meets the Eighth Amendment standard.
To be sure, a specific forfeiture may run afoul of the Amend-
ment's proportionality requirement.“ In Solem v. Helm, 463
U.S. 277 (1983),* the Supreme Court declared unconstitutional a
life sentence imposed without possibility of parole and set forth a
three-part test to use in reviewing the proportionality of sentences
under the Eighth Amendment. /d. at 290-303. Certain language
in the Court's opinion implied that all criminal sanctions are sub-
ject to proportionality analysis under the Eighth Amendment:
[W]e hold as a matter of principle that a criminal sentence
must be proportionate to the crime for which the defendant
has been convicted. Reviewing courts, of course, should
grant substantial deference to the broad authority that legis-
latures necessarily possess in determining the types and lim-
its of punishments jor crimes, as well as to the discretion that
trial courts possess in sentencing convicted criminals. But no
% See also United States v. Huber, 603 F.2d 387 (2d Cir. 1979).
4 The Ninth Circuit in United States v. Busher, 817 F.2d 1409, 1414-15, n.9
(9th Cir. 1987) criticizes Grande for misapplying the proportionality require-
ment. This criticism seems to miss the mark and in any event does not dimin-
ish the persuasiveness of Grande on the questions of the facial validity of
RICO’s forfeiture provisions under the Eighth Amendment.
In Solem, the Court held that a life sentence without parole was unconstitu-
tionally disproportionate.
A-66
penalty is per se constitutional. As the Court noted in Robin-
son v. California, 370 U.S., at 667, a single day in prison
may be unconstitutional in some circumstances.
463 U.S. at 290 (citations omitted).
The Fourth Circuit, however, in United States v. Rhodes, 7%
F.2d 1019 (4th Cir. 1985), held that a severe sentence for a term of
years did not require a proportionality analysis. Id. at 1027-28.
The court interpreted Solem as requiring an extensive proportion-
ality analysis “only in those cases involving life sentences without
parole.” Id. at 1028. In light of Rhodes, it appears that RICO's
forfeiture provisions do not require a proportionality analysis. Yet
even if such an analysis is required. no final judgment can be
made as to proportionality until the matter is tried. Any attempt
to perform a proportionality analysis now would be premature. It
is enough at this point for this Court to conclude, as it does, that
RICO’s forfeiture provisions are facially valid and that the for-
feiture allegations in this indictment, if proved, are not on their
face unconstitutionally disproportionate.”
D. RICO Forfeiture Does Not Violate Due Process
The Fourth Circuit has addressed the issue of whether RICO’s
forfeiture provisions violate the Fifth Amendment's due process
clause and concluded that they do not. United States v. Grande,
620 F.2d 1026 (4th Cir. 1980). After careful historical analysis, the
» There may indeed be circumstances where the forfeiture ordered. in light of
all circumstances, is unconstitutionally disproportionate. See Busher, 817
F.2d at 1414. Yet, whether this court has authority to mitigate or adjust the
jury's forfeiture verdict is unclear. See, e.g.. United States v. Kravitz, 738
F.2d 102. 104 (3d Cir. 1984) (under 18 U.S.C. 1963(a) forfeiture is mandatory
upon finding that appellant's property was used to promote racketeering).
See generally Reed, Criminal Forfeiture Under the Comprehensive Forfeit-
ure Act of 1984: Raising the Stakes. 22 Am. Crim. L.Rev. 747, 770 (1985)
(discussing authority of district courts to mitigate jury's forfeiture verdict). In
any event, this issue is not yet before the Court.
A-67
Court correctly concluded that RICO’s provisions are much nar-
rower than the broad forfeiture proscribed by Article III, § 3, cl.
2 of the Constitution.” Thus, RICO forfeiture is not unconstitu-
tional as a ‘forfeiture of estate.” Jd. at 1039.
E. Ex Post Facto
Finally, defendants argue that RICO’s forfeiture provisions, as
applied to property acquired prior to 1984,” are violative of ex
post facto laws. Yet all courts that have considered whether RICO
violates the ex post facto clause of the Constitution have uni-
formly concluded that it does not. E.g., United States v. Brown.
555 F.2d 407, 416-17 (Sth Cir. 1977), cert. denied, 435 U.S. 904
(1978); United States v. Campanale, 518 F.2d 352, 364-65 (9th
Cir. 1975), cert. denied, 423 U.S. 1050 (1976). Indeed, the Senate
Judiciary Committee, in drafting RICO, specifically considered
this issue and reached the following conclusion:
One act in the pattern must be engaged in after the effective
date of the legislation. This avoids the prohibition against ex
post facto laws and bills of attainder. Anyone who has
engaged in the prohibited activities before the effective date
of the legislation is on prior notice that only one further act
[including forfeiture] of this chapter.
5S. Rep. No. 617, 91st Cong., Ist Sess. 158-160 (1970). It is clear
from RICO’s legislative history and subsequent case law that
RICO is not constitutionally infirm as an ex post facto law.
© Article III, § 3, cl. 2 of the Constitution reads: “no Attainder of Treason shall
work Corruption of Blood. or Forfeiture except during the Life of the Person
attainted.” Article III. § 3, cl. 2 of the constitution was supplemented by the
first congress, which enacted | Stat. 112. 117 (1790). presently codified at 18
U.S.C. § 3563. Currently, that section reads: “No conviction or judgment
shall work corruption of blood or any forfeiture of estate.
* In 1984 RICO was amended to include dealing in obscene matter as a “racke-
leering activity. See supra note 4 and accompanying text.
A-68
Accordingly, defendants’ properties acquired by proceeds of
racketeering activity are subject to forfeiture, provided all other
requirements are met, even though they were purchased prior to
1984.
CONCLUSION
The application of the RICO criminal forfeiture sanctions to
the crime of obscenity raises novel and important constitutional
issues. This Court concludes, at length, that Congress’ decision to
use RICO as a weapon against purveyors of obscenity does not
offend the Constitution. This is so because the RICO criminal
forfeiture provisions, as applied to obscenity, require that there be
a nexus between the obscenity purveyor’s ill-gotten racketeering
gains and any protected material seized. Post conviction seizure
of arguably protected materials and assets is constitutionally per-
missible where there is proper proof that they were acquired or
including dealing in obscenity. Therefore, RICO and its forfeit-
ure provisions do not unconstitutionally chill protected speech or
act as prior restraints. To be sure, RICO’s sanctions are severe.
but severity alone does not cause unconstitutional chilling or con-
A-69
vert these sanctions into prior restraints.*’ In adding obscenity to
RICO, Congress has stayed within constitutional bounds.
An order has been entered reflecting the Court's rulings on
these issues. It remains only for the Court to note that the argu-
ments and briefs of counsel for all the defendants and the United
States reflected competency, energy (on occasion, perhaps, to an
excess) and ingenuity.
The Clerk of this Court is directed to send copies of this Memo-
randum Opinion to counsel of record.
/s/ T.S. Ellis, I
T.S. Ellis, III
United States District Judge
Alexandria, Virginia
November 3, 1987
ENTERED Nov. 3, 1987
39 The crux of defendants’ chilling and prior restraint arguments is the alleged
excessive vagueness of the obscenity standard. This attack was long ago laid
to rest in Roth and its progeny. The Miller-Roth standard is a middle ground
between the absolutism that would allow, indeed protect, all obscene expres-
sion and a philosophy that states should have unfettered discretion to ban as
much or as little sexually explicit expression as they wish. The genius of this
middle ground solution is that it allocates to the people the essential power to
regulate obscenity; it defines obscenity, it does not prohibit it. That decision is
left in the first instance to the people acting through Congress or their state
legislatures. Conceivably, the people might choose to legalize dissemination
of obscene expressions. The people have not so chosen. They have. on the
contrary, chosen to exercise their right to proscribe obscenity. Tne Miller-
Roth middle ground also maximizes the people's power over the regulation of
obscenity by giving juries the right to decide cases under a temporally and
geographically fiexible community standard. This may result in an imperfect
or imprecise line between obscenity and protected speech. but not an uncon-
stitutional one.
A-70
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
Alexandria Division
UNITED STATES OF AMERICA,
v. Criminal No. 87-00208-A
DENNIS E. PRYBA, et al..
Defendants.
DEFENDANTS’ EXHIBIT LIST
Exhibit No. DESCRIPTION
| Magazine entitled ‘““Oralama”’
2 Magazine entitled ‘“‘High-Heeled Women”
3 Magazine entitled “Oui”
4 Magazine entitled ‘Adult Cinema’
> Magazine entitled ‘Club International”
6 Magazine entitled “Erotic X Film Guide”
7 Magazine entitled “Velvet”
8 Magazine entitled “Club”
Q Magazine entitled ‘X-Rated Cinema and Video”
10 Magazine entitled “Nugget”
1] Magazine entitled “Kinky Couples”
12 Magazine entitled “Adult Erotica”
13 Magazine entitled “Tight Ropes”
14 Magazine entitled “High Society”
15 Magazine entitled “Swank”
16 Magazine entitled “Hustler”
17 Magazine entitled “Hottest X-Rated Film
Scenes”
18 Magazine entitled ‘Adults Only”
A-71
Magazine entitled ‘Best of Bi-Girls”
Magazine entitled ‘‘ Mayfair"
Magazine entitled ‘‘Whitehouse Digest”’
Video tape entitled “Behind the Green Door”
Video tape entitled “Bizarre Styles”
Video tape entitled “Dracula Exotica”
Video tape entitled “Girls of the A Team”
Video tape entitled “Girls of the A Team”
Video tape entitled “Limited Edition, Vol. 21"’
Video tape entitled ‘“Taboo III”
Video tape entitled ““True Crimes of Passion”
Video tape entitled ‘Wet Shots”
Diagram of the Video Rental Center located at
3523 S. Jefferson Street, Bailey's Crossroads, Vir-
ginia
DENNIS E. PRYBA
BARBARA A. PRYBA
JENNIFER WILLIAMS
EDUCATIONAL BOOKS, INC.
By Counsel
Counsel for Defendants:
Thomas J. Morris, Esquire
5235 Wilson Boulevard
Arlington, VA 22205
703/524-1900
Counsel for Dennis E. Pryba
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William B. Cummings, Esquire
112 S. Pitt Street
P. O. Box 1177
Alexandria, Virginia 22313
703/836-7997
Counsel for Barbara A. Pryba
Plato Cacheris, Esquire
1220-19th Street, NW
Suite 400
Washington, DC 20036
202/861-1070
Counsel for Jennifer G. Williams
_ COHEN, DUNN & SINCLAIR, PC.
221 S. Alfred Street, P.O. Box 117
Alexandria, Virginia 22313-0117
(703) 836-9000
Counsel for Educational Books, Inc.
By: s/J. Frederick Sinclair
J. FREDERICK SINCLAIR
Certificate of Service
I hereby certify that on this 5th day of November, 1987, a true
copy of the foregoing was hand delivered to Lawrence Leiser.
Assistant United States Attorney, 701 Prince Street. Alexandria,
Virginia 22314.
s/J. Frederick Sinclair
J. FREDERICK SINCLAIR
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IN THE UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF VIRGINIA
Alexandria Division
UNITED STATES OF AMERICA
Vv.
. Criminal No. 87-00208-A
DENNIS E. PRYBA, et al.
MEMORANDUM OPINION
This unprecedented case is fairly brimming with novel issues. '
Those discussed here are prompted by the use, for the first time,
of RICO’s forfeiture provisions in the obscenity context. These
issues arise as a consequence of the jury's verdict convicting the
defendants of RICO obscenity violations.? Because the trial was
bifurcated, forfeiture issues were postponed until, if needed, the
second phase of the trial. That time has now arrived and these
issues must be resolved.
They are, specifically:
| See, e.g., United States v. Pryba, ___F Supp.____ (E.D.. Va. 1987) (constitu-
tionaiity of RICO's forfeiture provisions as applied to obscenity cases}; United
States v. Pryba, ___F Supp.____ (E.D. Va. 1987) (admissibility of polls, sur-
veys, and “expert” testimony regarding community acceptance of sexuaily
explicit material); United States v. Pryba, ___F .Supp.____ (E.D. Va. 1987)
(admissibility of prior convictions for dealing in obscenity to prove a predicate
act of racketeering under RICO).
2 Defendants were indicted under RICO for dealing in obscene matter, specifi-
cally, four video tapes and nine magazines. The jury found obscene the four
vie vo tapes, “She-Male Confidential, Bizarre Encounter #9," ‘Wet Shots,”
The Girls of A-Team.” and “Punishment of Anne,” and six magazines, *“Tor-
ment,” “She ... who must be obeyed,” “Bottoms Up,” “Slave Training,’ ‘“Tied
Up, and “Tender Shavers.” The jury found one magazine. ‘Super Bitch,” not
to be obscene. and could not agree on two of the magazines, “Crotches” and
‘Poppin Mammas.” A mistrial was granted with respect to these two maga-
zines.
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1) What is the government's burden of proof in RICO forfeit-
ure proceedings?
2) In RICO obscenity prosecutions where practical consider-
ations place limits on the amount of material that can be attacked
as obscene. can the United States show by circumstantial evidence
that material not submitted to the factfinder and found obscene is
nonetheless obscene so that the business can be labeled as essen-
tially the business of selling obscenity?
Each question is separately addressed.
I. RICO Forfeiture Burden of Proof
There is, surprisingly, no direct guidance on the burden of
proof in RICO forfeiture proceedings. The RICO statute itself is
silent. Equally silent is the remarkably sparse legislative history.
No decision directly confronts the issue. Where it is mentioned in
RICO decisions, the answer is simply assumed, with neither
argument nor discussion to illuminate the issue. The parties’ posi-
tions are predictable. For defendants the reasonable doubt stand-
ard is an article of faith; they rely on cases that assume without
deciding that reasonable doubt is the forfeiture standard as well
as the standard for determining guilt or innocence. The govern-
ment, eager to avoid the rigor of the reasonable doubt standard,
relies chiefly on non-RICO authority. Both arguments merit
scouting, but ultimately neither is dispositive.
Typical of defendants’ authorities is United States v. Cauble,
706 F.2d 1322 (Sth Cir. 1983), cert. denied, 465 U.S. 1005 (1984).
There the court upheld a jury instruction that stated once defend-
ant was found guilty of a RICO violation, it was the jury's duty
‘to determine whether the government has proven beyond a rea-
sonable doubt that |defendant’s] interest ... is subject to forfeit-
ure. 706 F.2d at 1347-48 (emphasis added). The standard of proof
is merely stated without argument. discussion or justification.
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United States v. Horak, 633 F.Supp. 190 (N.D.II1. 1986) is essen-
tially similar. There, in a bifurcated RICO trial, the court held
that:
[iJn order for the government to prevail on an (a)(2) forfeit-
ure, it must show each of the four categories of assets hav
some connection (a nexus) with the underlying racketeering
activity. ..- That nexus is shown when the government
proves beyond a reasonable doubt that the relevant category
of property provided the Defendant with a source of influ-
ence over an enterprise and Defendant has a property inter-
est in that same enterprise.
633 F.Supp. at 199-200 (emphasis added). Again. the appropri-
ateness of the proof standard is assumed without discussion. In
another case defendants cite, the parties agreed that the nexus
between property subject to forfeiture and the RICO violation
had to be proved beyond a reasonable doubt. United States v.
Ragonese, 607 F.Supp. 649, 650-51 (S.D.Fla. 1985), aff'd, 784
F.2d 403 (11th Cir. 1986). At least one commentator seems to have
made the same assumption’ and even the government in another
case submitted a brief and published material stating the same
assumption.
The government's position rests chiefly on United States v.
Sandini, 816 F.2d 369 (3d Cir. 1987), a continuing criminal enter-
prise (CCE) forfeiture case. Title 21, Section 853(d) provides for a
rebuttable presumption in favor of forfeiture.
5 See Reed. Criminal Forfeiture Under the Comprehensive Forfeiture Act of
1984: Raising the Stakes, 22 Am. Crim. L. Rev. 747. 758 n.66 (1984).
* See Brief for the United States in Opposition. United States v. Cauble. 706
F.2d 1322 (Sth Cir. 1983) (No. 83-585). cited in D. Smith. PROSECUTION
AND DEFENSE OF FORFEITURE CASES § 13.01 n.9 (1985). This posi-
tion. of course. is not binding on the United States in the present case.
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There is a rebuttable presumption at trial that any property
of a person convicted of a felony under this subchapter or
subchapter III of this chapter is subject to forfeiture under
this section if the United States establishes by a preponder-
ance of the evidence that —
(1) such property was acquired by such person during the
period of the viclation of this subchapter or subchapter Ill
of this chapter or within a reasonable time after such period;
and
(2) there was no likely source for such property other than
the violation of this subchapter or subchapter III of this
chapter.
The Third Circuit construed this provision to provide for a pre-
ponderance standard throughout a CCE forfeiture proceeding
and not just to establish the rebuttal presumption. Quite apart
from the fact that it is a CCE case, not a RICO case, and hence
distinguishable, Sandini may be wrongly decided. In reaching its
decision the Third Circuit cited the legislative history of the CCE
forfeiture provision as support. 816 F.2d at 876. That history,
closely read. suggests the contrary of the Sandini result. It states
that the presumption. [framed as a permissive and rebuttable
inference rather than a mandatory presumption, ... would appear
to meet constitutional standards.” Ulster County Court v. Allen,
442 U.S. 140 (1979) is cited in the legislative history as support.
Significantl , Allen makes clear that a rebuttable presumption is
constitutionally acceptable as long as the device does not ‘‘under-
mine the factfinder’s responsibility at trial ... to find the ultimate
facts beyond a reasonable doubt.” 442 U.S. at 156. Thus, Allen
and the CCE legislative history seem to suggest that permissive
rebuttable presumptions established by a preponderance are
> Comprehensive Crime Control Act of 1984. S. Rep. No. 225. 986th Cong.. 2d
Sess. 19], 192. reprinted in 4 U.S. Code Cong. & Admin. News 5183. 3395
(1984).
A-77
acceptable in the criminal context provided they do not change
the ultimate reasonat'e doubt standard to be used by the factfin-
In any event, Sandini is distinguishable for RICO has no rebutt-
able presumption provision analogous to CCE's.°
Ultimately persuasive to the Court is Congress’ silence in the
face of clear evidenee in RICO and elsewhere that Congress
knows how to change the proof standard when it wishes to do so.
Thus, in ¢ 196311), Congress has provided that a third party
owner of assets that may be subject to forfeiture can save his or her
interest in the asset by proving by a preponderance of the evidence
that he or she is a bona fide purcheser or has an interest superior
to the defendant's. By choosing not to use the same language in
§ 1963(a) Congress has invited the inference that the reasonable
doubt standard should be employed throughout a RICO proceed-
ing except where there is explicit provision otherwise.
Context adds clarity to Congress’ silence on RICO forfeiture
burden of proof. There is no requirement in RICO that the guilt
or innocence phase of the trial be bifurcated from the forfeiture
phase. Often the phases are tried together. See e.g., Cauble, 706
F.2d 1322; United States v. Hess, 691 F.2d 188 (4th Cir. 1982).
Surely there can be no question that the reasonable doubt stand-
ard applies io the first phase. Almosi us free from doubt is the
® Also distinguishable are the government's other authorities. United States v.
One Assortment of 89 Firearms, 4605 U.S. 354 (1983) was not a RICO case and
involved in rem. not in personam, forfeiture. United States v. Ginsburg, 773
F.2d 798 (7th Cir. 1985), cert. denied, 475 U.S. 1011 (1986). heid owly that the
government did not have to prove bevond a reasonable doubt that legal fees
said to be the subject of forfeiture were still in existence at the time of convic-
tion. Th. existence of assets at the time of conviction is not here in issue. More-
over, the government 's chief reliance is language in a dissenting opinion which
the court finds inapposite. 733 F.2d at 807 (Ripple. J.. dissenting).
To sum up. no dispositive authorities exist. RICO itself is silent and the
pertinent decisions merely assume the point in issue. but do not confront or
discuss it.
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inference that had Congress intended a different standard to
apply, it would have recognized and addressed the practical diffi-
culties involved in applying different proof standards to interre-
lated issues in the same proceeding. Consid:r, for example, the
diffieulty a jury might encounter in applying different standards
_of proof in the same trial in connection, first, with finding the
existence of, and drawing the broad outlines of, a RiCO “enter-
prise’, which is necessary to determine guilt or innocence; and
then defining the details of the enterprise, which may only be rele-
vant to forfeiture. Whether bifurcation would ameliorate these
difficulties is unclear. In any event, what little authority exists
taken together with Congress’ failure to treat the issue explicitly
and grapple with the practical problems, persuade the Court that
the reasonable doubt standard is and should be applicable in
RICO forfeiture proceedings. '
Il. Proof of Obscenity By Circumstantial Evidence
At the trial on the issue of guilt or innocence, the government
charged as obscene four video films and nine magazines.* The
jury found all four videos obscene as well as six of the nine maga-
zines. Of course, the materials found obscene, four videos and six
magazines, even assuming numerous copies, was apparently only
a small part of the defendants’ stock in sexually explicit material.
Seeking to overcome this in the trial’s forfeiture phase, the gov-
ernment sought to prove by circumstantial evidence that the
defendants’ businesses as a whole were chiefly in the business of
selling obscene material. More specifically, the United States
* As stated. no authority exists which directly addresses the burden of proof
applicable to RICO forfeiture. Yet when considering novel issues in a RICO
setting, it is worth noting that the rule of lenity applies “even in RICO cases.”
United States v. Computer Sciences Corp., 689 F.2d 1181, 1190 (4th Cir.
1982). cert. denied, 459 U.S. 1105 (1983). The Court's decision is in accord
with the rule of lenity.
* See supra note 2.
A-79
offers a witness, a putative expert in obscenity investigations, who
was prepared to testify that based on certain indicia common to
obscenity businesses, the defendants’ enterprise could be said to
be chiefly in the business of selling obscene materials. Included
among the indicia relied on by this witness were such factors as
the existence of “peep machines’, the offering for sale of so-called
“rubber goods” or “marital aids"’, the use of the term “adult” in
_ the store sign, and the pandering of sexually explicit material.
From these circumstances. the expert would opine that much of
defendants stock in trade is obscene and that defendants are
essentially purveyors of obscenity.
This testimony must be excluded; the First Amendment is an
insuperable obstacle to its admission. The evidence runs outside
constitutional bounds by presuming obscenity from circum-
stances and from proximity to the convicted material. There is no
presumption of obscenity that arises from circumstances or from
the fact that material is sexually explicit. On the contrary, there is
a presumption that such expressions, however, unappealing they
may be. are protected by the First Amendment. Roaden v. Ken-
tucky, 413 U.S. 496 (1973). Not until the material is reviewed in
its enti *y by a judge or jury and found to meet the three Miller-
Roth tects’ can the material be labeled obscene and undeserving
of First Amendment protection. Significantly, obscenity may not
be predicated on excerpts; the material as a whole must meet the
three tests. See Brockett v. Spokane Arcades, Inc., 472 U.S. 491
(1985). Even search warrants for allegedly obscene material can-
not issue except through a process ‘designed to focus searchingly
° In Miller v. California, 413 U.S. 15, 24 (1953), the Supreme Court held that
speech may be banned as obscene where:
(a) the average person. applying contemporary community standards
would find that the work. taken as a whole. appeals to the prurient interest:
(b) the work describes, in a_patently offensive way, sexual conduct
defined by the applicable state law: and
(cl the work. taken as a whole. lacks serious literary. political, or scientific
value.
A-80
upon the question of obscenity.” Marcus v. Search Warrant, 367
U.S. 717, 732 (1961); see also United States v. Tupler, 564 F.2d
1294 (9th Cir. 1977) (seizure of films invalid without examination
of contents of the film, notwithstanding sexually explicit photo-
graphs on boxes and notwithstanding that recipients were known
dealers in sexually explicit materials).
In summary, the government's proffered expert testimony
must be excluded. Obscenity is not an ini ection caught by proxim-
ity; it can be established only directly, not circumstantially. How-
ever important and laudable Congress’ goals may be in adding
obscenity to RICO, those goals cannot be achieved at the expense
of ignoring the First Amendment. However important the battle
against obscenity may be. we cannot permit the First Amendment
to be a casualty.
The Clerk of this court is directed to send copies of this Memo-
randum Upinion to counsel of record.
/s/ T.S. Ellis, II
T.S. Ellis, II
United States District Judge
Alexandria, Virginia
November 18, 1987
ENTERED Nov. 23, 1987
A-3l
IN THE UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF VIRGINIA
Alexandria Division
UNITED STATES OF AMERICA
v. Criminal No. 87-00208-A
DENNIS E. PRYBA,
BARBARA A. PRYBA.,
JENNIFER G. WILLIAMS, and
EDUCATIONAL BOOKS, INC.
MEMORANDUM OPINION
Introduction
After eight days of trial on the issues of guilt,' a jury convicted
Jennifer Williams and three co-defendants of various violations of
the Racketeer Influenced and Corrupt Organizations Act
(RICO), 18 U.S.C. §§ 1961 et seq., and interstate transportation
| The trial was bifurcated. The issues of guilt were tried first to the jury and
then. after verdicts of guilty on the RICO +_.d obscenity counts. the forfeiture
issues were tried to and decided by the same jury. See L nited States v. Conner.
752 F.2d 566, 569, 575 (11th Cir.) (noting that a bifurcated procedure had been
followed below), cert. denied, 474 U.S. 821 (1985); United States v. Cauble.
706 F.2d 1322, 1348 (Sth Cir. 1983) (advising that for future trials. forfeiture
issue should be withheld from jury until after it has returned a general ver-
dict), cert. denied. 465 U.S. 1005 (1984). Altogether. both phases of the trial
consumed a total of eleven aavs. Defendant Williams elected to rest following
the government s evidence on the issue of guilt. She also elected not to partici-
pate in the forfeiture stage of the trial. chocsing instead to forfeit voluntarily all
the corporate offices she held in the various Prvba companies that comprised
the RICO “enterprise.”
A-B2
of obscene material, 18 U.S.C. § 1465.° More specifically,
defendant Jennifer Williams was convicted by the jury of (1)
being associated with or employed by an ‘enterprise’ and con-
ducting or participating, directly or indirectly, in the conduct of
such enterprise through a pattern of racketeering activity, 18
U.S.C. §§ 1961/4}, 1962(c); (2) conspiring to use or invest income
derived from a pattern of racketeering activity in the enterprise.
18 U.S.C. § 19621d)}; and (3) seven counts of transporting obscene
material in interstate commerce for sale or distribution. 18 U.S.C.
§ 1465.
Defendant Williams moved for a judgment of acquittal at the
conclusion of the government's case and again after the adverse
verdict. The matter was briefed and argued orally, and this Mem-
orandum Opinion records the Court's reasons for denying the
motions.
The twelve count indictment against defendants included three RICO counts.
seven counts of interstate transportation of obscene maternal and two counts of
tax fraud (26 U.S.C. § 7206). Defendant Williams was not named in the tax
fraud counts. She was convicted on two of the three RICO counts and all seven
of the coun.s charging interstate transportation of obscene maternal. Although
the jury found that one of the magazines listed in Count © of the indictment
as not obscene and was unable to reach a verdict as to two of the magazine
listed un Count 10. a guilty verdict was rendered on both counts because they
involved other magazines the jury did find w be obscene.
— Section 196114) defines enterprise to include “any individual. partnership.
corporation. association. or other legal entity. and any amon or group of ind)-
viduals assomated un fact although not a legal entity. In this case. the enter-
pmse consisted of individuals. the Prvbas and Williams. wether with the
\arnous corporations the Prvbas established. as the government s evidence
showed for the purpose of unsulaung them from criminal iiability. F or a more
complete descrpuion of the enterprise. see infra note 8 and appendix.
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The Standard for Judgment of Acquittal
A criminal defendant seeking a judgment of acquittal in the
face of an adverse jury verdict must meet a rigorous standard. In
the words of the Supreme Court, [t]he verdict of a jury must be
sustained if there is substantial evidence, taking the view most
favorable to the government, to support it.” Glasser v. United
States, 315 U.S. 60, 80 (1942). Cases echoing this principle are
legion,* as are its various formulations. Among the most fre-
quently cited and illuminating are those of the District of Colum-
bia Circuit. In United States v. Reese. 561 F.2d 894 (1977), that
court stated the principle in these terms:
It is only when there is no evidence upon which a reasonable
mind might fairly conclude guilt beyond a reasonable doubt
that a motion for judgment of acquittal may be granted.
Id., at 898 (emphasis added); see also United States v. Tresvant,
677 F.2d 1018, 1021 (4th Cir. 1982). And in United States v.
Peterson, 509 F.2d 408 (1974), the D.C. Circuit chose the follow-
ing formulation:
To grant a motion for acquittal, the court must find that
when viewed in the light most favorable to the government,
the evidence is such that a reasonable juror must have rea-
sonable doubt as to the existence of any of the essential ele-
ments of the crime.
Id. at 411. Finally, in United States v. Singleton, 702 F.2d 1159
(D.C. Cir. 1983), the court observed that, “If the evidence rea-
sonably permits a verdict of acquittal or a verdict of guilt. the
+ See. e.g.. United States v. Jones, 735 F.2d 785, 790, 791 (4th Cir.). cert.
denied, 469 U.S. 91811984}: United States v. Slocum, 708 F.2d 587, 594 (11th
Cir. 1983).
A-84
decision is for the jury to make.” Id. at 1163 (quoting Curley v.
United States, 160 F.2d 229, 237 (D.C. Cir.) cert. denied, 331
U.S. 837 (1947)).
Here, defendant Williams specifically attacks the sufficiency of
the evidence on “guilty knowledge. She contends that acquittal
is required because the evidence does not show that she acted with
“the requisite criminal intent.” On this point, the Fourth Circuit
has framed the standard for a motion for acquittal as follows:
In determining whether there was sufficient evidence
regarding “knowledge” to sustain the guilty verdicts, the
court must consider whether any rational trier of fact could
have found the existence of knowledge beyond a reasonable
doubt.
United States v. Zandi, 769 F.2d 229, 235 (1985); see also United
States v. Steed, 674 F.2d 284, 286-89 (4th Cir.), cert. denied, 459
U.S. 829 (1982).
In sum, defendant Williams burden on a motion for acquittal
is a formidable one; she must show that viewing the evidence in
the light most favorable to the government, there is no substantial
evidence to support the verdicts. To sustain the verdict, the court
need only find that the record includes evidence from which a rea-
sonable person could find guilt; it need not find that the evidence
compels guilt and wholly excludes innocence. “‘It is not necessary
[to support a conviction] that the evidence exclude every reason-
able hypothesis of innocence cr be wholly inconsistent with every
conclusion except that of guilt, provided a reasonable trier of fact
could find that the evidence establishes guilt beyond a reasonable
doubt. A jury is free to choose among reasonable constructions of
the evidence.” United States v. Bell, 678 F.2d 547, 559 (5th Cir.
1982), aff'd, 462 U.S. 356 (1983); see also United States v. Slo-
cum, 708 F.2d 587, 594 (11th Cir. 1983). With this summary of
A-85
the standard as a lens. we focus next on an examination of the evi-
dence.
The Evidence
A review of the record compels the conclusion that there is
ample and substantial evidence from which reasonable jurors
could have found Williams guilty. At most, defendant Williams
has shown only that the evidence does not exclude innocence. She
has not shown that there was no evidence, viewed in the light most
favorable to the government, to support the verdicts. Nor has she
shown that the government's case, as she claims, relied ‘totally
on speculation and inferential evidence.”
First, there was ample evidence to support a finding that Wil-
liams was aware of the sexually explicit nature of the materials
that Dennis and Barbara Pryba’s corporations were selling. The
record reflects that in the 1970's, the Prybas were engaged in the
business of selling and distributing sexually explicit materials.
Defendant Williams, sister of co-defendant Barbara Pryba and
sister-in-law of co-defendant Dennis Pryba, began working for
the Prybas’ various business entities in the late 1970s. During this
period and well into the 1980s, Williams worked on a daily basis
at the Prybas’ warehouse in Maryland. Evidence adduced at trial
showed that sexually explicit materials were stored at the ware-
house and that the warehouse was relatively small. The jury could
reasonably have concluded that the sexually explicit nature of the
warehouse inventory must have been apparent to anyone working
there. Moreover, the jury could reasonable have found that the
sexually explicit nature of the materials shipped in interstate com-
merce and sold by the enterprise was evident from the invoices
Williams handled as an officer and bookkeeper of the Prybas’ cor-
A-86
porations.’ Finally, the evidence indicated that the corporations
and their employees were regularly prosecuted and convicted for
sale and distribution of obscene material.° Each of these, in
» Numerous government exhibits, see, e.g.. Nos. 56, 59, 59A, established that
invoices frequently included the sexually explicit titles of materials, and from
this the jury could reasonably have concluded that defendant Williams under-
stood the nature of the products the enterprise sold.
* Educational Books, Inc.. one of the Pryba corporations that comprised the
RICO “enterprise. ’ was convicted fifteen times in the Circuit Court of Fairfax
County during 1981-83 for selling or distributing obscene material. A review of
the material involved in those convictions supports the jury's conclusion that
defendant Williams, given her relationship to the Prybas and her role as book -
keeper and officer for the enterprise corporations, knew well that she was
involved in an enterprise that sold and distributed sexually explicit material.
Date Obscene Material Involved in Conviction
(Al May 11.1989 Ct. 1—Film, “Anal Ecstasy”
Ct. 2—Film, “Cunt to Cunt”
Ct. 3—Film, “Icing on My Cake”
Ct. 4—Film, “Seka's Fulfillment”
Ct. 5—Film, “Fuck Her Ass”
Ct. 6—Film, “The Voyeur Gets His”
Ct. 7—Film, “Seduction of the Delivery Boy”
Ct. 8—Film, “Rape”
Ct. 9—Film, “Up the Chute”
(B) May 18,1982 Ct. 1—Film, “The Pleasure Shoppe”
Ct. 2—Magazine, “Girls Who Eat Cum No. 2”
(C) May 18,1982 Ct. 1—Magazine, “Deviations”
Ct. 2—Magazine.
Ct. 3—Magazine, “Swedish Erotica No. 4"
Ct. 4—Magazine, i .
(D) Jume 15,1982 Ct. 1—Magazine, “Sucking Young Girls”
(E} June 15,1982 Ct. 1—Magazine, “Rampage”
(F) June 15,1982 Ct. 1—Magazine, “Fucking Blondes”
Ct. 2—Magazine, “Sweet Meats”
(G) June 15,1982 Ct. 1—Magazine, “Swedish Erotica No. 12”
Ct. 2—Magazine. “Swedish Erotica No. 19”
Ct. 3—Magazine. “Silky”
Continued on next page
A-87
Continued from previous page
Date
Cr.
(L) June 6, 1983
iM} Dee. 2. 1983
iN) Jan. 27. 1984 Ct.
ct.
. 9—Magazine.
. 10—Magazine
Obscene Material Involved in Conviction
(H) June 15. 1982 Ct. ine, “Trio”
Ct.
Ct.
(1) June 15. 1982 Ct.
Ct.
Ct.
(J) Aug. 12, 1983 Ct.
Trio
. “Unreal People
“John Holmes (No. 1 Cock)”
. “Tight Assed Blond”
" “Baby”
. "Nympho Housewives”
. “Lav a
Sensua
“Girls Who Eat Cum”
“Bi Guys and A Girl”
Eries No. 2”
a
Lab bal otal l
por:
i
il
€
et
. Three's a Crowd”
ze
af
Fair Fare”
—
S
ae)
No. 155"
A-B8
itself, was sufficient to put Williams on notice regarding the sexu-
ally explicit nature of the merchandise in which her employers
were dealing.’ Taken together, they compel the conclusion that
the jury's verdict with respect to Williams knowledge of the mate-
rials is amply supported by record evidence.
Williams continued to work as the RICO enterprise's sole
bookkeeper until mid-1985.* Acts confirming her knowing partic-
ipation in this enterprise include: (1) signing the annual report for
Suburban News, Inc. on February 28, 1978, and listing herself as
the director, president. vice president, secretary and treasurer; (2)
filing an annual report as president for M Street Enterprises on
January 16, 1978, and listing Dan Gottesman as the secretary of
the corporation knowing that he did not serve in that capacity; (3)
signing a similar document as president of M Street Enterprises in
1979 and listing herself as director, president, vice president, sec-
retary and treasurer; (4) using the signature stamps of John R.
Jones and Dan Gottesman when she knew that they were not cur-
rent officials of the Prybas’ corporations; (5) signing a property
tax return for Suburban News in 1983 as a corporate officer and
affirming under penalty of perjury that she was the president,
vice president, secretary, treasurer and director of the corpora-
tion; (6) filing an application as president and secretary for
> It is sensibly settled that conviction under 18 U.S.C. § 1461 et seq. does not
require proof that the defendant knew the material was legally obscene. |t is
enough to show that defendant knew generally that the material was sexually
oriented or sexualiy explicit. Hamling v. United States, 418 U.S. 87. 119-24
(1974); see also Rosen v. United States, 161 U.S. 29, 41-42 (1896); United
States v. Cohen, 583 F.2d 1030, 1042 (8th Cir. 1978); United States v.
Linetsky, 533 F.2d 192. 204 (Sth Cir. 1976}; United States v. Sulaiman, 4%
F.2d 78, 79 (Sth Cir.), cert. denied, 419 .S. 911 (1974).
® A vivid sense of defendant Williams’ role.in the RICO enterprise can be
obtained from government exhibit No. 132. ¢ portion of which is attached as
an appendix to this 1. emorandum. This exhibit graphically depicts the Pry-
ba’s RICO enterprise and the extent of defendant Williams involvement in it.
Note that all the stock of the various corporations was owned by the B & D
Corporation and the Prybas owned all the stock of the B & D Corporation.
A-89
authority to transact business in Virginia on behalf of Video Shop,
Ltd. and indicating that she was the sole director and stockholder
when she knew that the corporation was owned by Dennis Pryba.
Barbara Pryba or Barbara Pryba’s father; (7) signing as presi-
dent of Video Shops, Ltd. in 1984, 1985 and 1986 and declaring
herself to be the president and sole director: (8) signing leases as
the president of Video Shop, Ltd.; and (9) signing as an officer on
corporate tax returns for B & D Corporation.”
The government also presented the testimony of an Internal
Kevenue Service agent who related events occurring in connection
with the RS’ attempt to collect delinquent taxes from B & D Cor-
poration. Williams represented that she was the president of B &
D and that she had authority to pay the obligations of the corpora-
tion.
From all this evidence, the jury could reasonably have inferred
that Williams, together with the other defendants, actively,
knowingly and willfully participated in and furthered the inter-
ests of the enterprise. She assisted the Prybas in distributing
obscene material by providing bookkeeping services. It strains
credulity to argue that she was not aware that the enterprise was
in the business of buying and selling sexually explicit magazines
and videos in interstate commerce. Further. the jury here could
reasunably and easily have concluded that Williams used her
name and those of others to hide the identities of the true owners
of the enterprise corporations, the Prybas. In short, the evidence
is compelling, if not conclusive, that a conspiracy existed in con-
nection with a RICO enterprise engaged in the interstate trans-
portation and sale of obscene material. Equally compelling is the
evidence of defendant Williams strong connection with and
involvement in this RICO enterprise.-Such evidence is plainly
* This listing is not intended to be exhaustive. The transcript. when it becomes
available. may disclose other evidence indicating defendant W i!!iams_ partici-
pation in. and knowledge of. the enterprise and its racketeering activity.
4-90
sufficient to convict. for “* ‘[o}nce the existence of a conspiracy is
established. evidence establishing beyond a reasonable doubt a
connection of a defendant with the conspiracy, even though the
connection is slight. is sufficient to convict him with knowing par-
ticipation in the conspiracy. ‘ United States v. Laughman, 618
F.2d 1067, 1076 (4th Cir.) (quoting United States v. Dunn, 564
F.2d 348. 357 [9th Cir. 1977] [emphasis in original]), cert. denied,
47 U.S. 925 (1980). Accordingly, the jury here had ample evi-
aence to conclude (i) that Williams knowingly aided the Prybas in
transporting obscene material for the purpose of sale and distri-
bution; (ii! that she was employed by a RICO enterprise and par-
ticipated in its affairs through a pattern of racketeering activity;
and (iii) thet she conspired to violate RICO by knowingly acting
in concert with the Prybas in using or investing proceeds from
racketeering activity in the enterprise. See 18 U.S.C. §§ 1465,
1962 (altelid).
In support of her claim that the evidence was insufficient, Wil-
liams cites United States v. Casperson, 773 F.2d 216 (8th Cir.
1985), in which the court reversed a bookkeeper's convictions for
fraud and conspiracy. Analysis shows Casperson is inapposite.
There. the defendant was charged with fraud as well as conspir-
acy to defraud. Proof of intent to defraud was therefore essential
to conviction on the substantive fraud counts. The only facts to
indicate the defendant's involvement in the alleged unlawful
plan, however, were that he had performed some bookkeeping
functions for the corporation in question, had attended promo-
tional meetings and on one occasion had explained the corpora-
tion's program to a potential investor, was a signatory on the
corporation's checking account and was referred to in documents
as the corporation's vice president. The defendant, whose tenure
with the corporation spanned less than one year, did not partici-
pate in the development of the fraudulent scheme, made no
administrative decisions. had never met the man who master-
minded the scheme. did not write checks for the corporation and
A-91
did not function as a vice president. On these facts, the court
found that the level of the defendant's participation in the corpo-
ration’s affairs was not sufficient to support an inference of an
intent to defraud.
In sharp contrast. Williams in this case was deeply involved in
the corporations affairs ior many years. She wrote checks and
conducted other business. filed official documents and repre-
sented that she held offices in a number of the corporations. She
assisted the Prybas in concealing their identities as the actual
principals of the corporations. U nlike the activities of the defend-
ant in Casperson, Williams activities demonstrate ‘the knowing,
affirmative cooperation” and involvement necessary to sustain
her convictions under the obscenity and the RICO counts. Cas-
person, 773 F.2d at 221.
CONCLUSION
Because the jury's verdict has a substantial basis in the evi-
dence. defendant Williams motion for a judgment of acquittal is
The Clerk of the Court is directed to send a copy of this Memo-
randum Opinion to counsel of record.
/s/ T.S. Ellis, 111
T.S. Ell
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