Opposition Brief — Yusuf v. United States (No. 06-892)

Supreme Court, LS.

Pre FILED

? | MAR 05 2007 |

—— k

No. 06-892 L_OFFICE OF THE CLERK |

In the Supreme Court of the Gnited States

FATHI YUSUF MOHAMMED YUSUF, AKA FATHI YUSUF,

ET AL., PETITIO) £RS

Vv.

UNITED STATES OF AMERICA

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

BRIEF FOR THE UNITED STATES IN OPPOSITION

PAUL D. CLEMENT

Solicitor General

Counsel of Record

EILEEN J. OCONNOR

Assistant Attorney General

ALAN HECHTKOPF

S. ROBERT LYONS

Attorneys

Department of Justice

Washington, D.C. 20520-0001

(202) 314-2216

QUESTION PRESENTED

Whether the warrants authorizing a search for

evidence of a complex money laundering scheme, tax

violations, and mail and wire fraud described peti-

tioners’ business records with sufficient particularity.

(1)

TABLE OF CONTENTS

Page

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TABLE OF AUTHORITIES

Cases:

Andresen v. Maryland, 427 U.S. 4638

GEE cave cars banene tear niees 9,10, 11, 12, 15, 17

Circuit City Stores, Inc. v. Adams, 532 U.S. 105

CA aks vide cs caedadaneensneeiaadseeabeetonea 13

Franks v. Delaware, 438 U.S. 154 (1978) ............... 6

Groh v. Ramirez, 540 U.S. 551 (2004) .............-- 7, 16

Illinois v. Gates, 462 U.S. 213 (1983) ............... 13, 18

Lafayette Acad., Inc., In re, 610 F.2d 1 (ist Cir. 1979) ... 20

Marvin v. United States, 732 F.2d 669 (8th Cir. 1984) ... 14

Rickert v. Sweeney, 813 F.2d 907 (8th Cir. 1987) ..... 19, 20

United States v. Ables, 167 F.3d 1021 (6th Cir.), cert.

Gene: GF Ui. ST Lae voc aoa dees cn caseusi 12

United States v. Abrams, 615 F.2d 541 (1st Cir. 1980) ... 20

United States v. American Investors of Pitt., Inc.,

879 F.2d 1087 (3d Cir.), cert. denied, 493 U.S. 955

(1900) emt 456 UBS. BEE CAD < 6 ee delcecnecdwenewss~ Pe

United States v. Brien, 617 F.2d 299 (1st Cir.), cert.

Goubad., 465 Ute Bie Ce” ik wavs 6 4a 0 bos oes babes 14

IV

Cases—Continued: Page

United States v. Cardwell, 680 F.2d 75 (9th Cir.

DE Sou babussvcueeens bide tread ives (kas 19, 20

United States v. Ervasti, 201 F.3d 1029 (8th Cir. 2000) .. 18

United States v. Gendron, 18 F.3d 955 (1st Cir.), cert.

Gombe, GES U5. TOG) CIGOG) os von vcesewetesecsess 13

United States v. Kepner, 843 F.2d 755 (3d Cir. 1988) ..... 8

United States v. Lamport, 787 F.2d 474 (10th Cir.),

cert. denied, 479 U.S. 846 (1986) .............-20008- 18

United States v. Logan, 250 F.3d 350 (6th Cir.), cert.

denied, 534 U.S. 895 and 534 U.S. 997 (2001) ........ 14

United States v. Martinelli, 454 F.3d 1300 (11th Cir.

2006), petition for cert. pending, No. 06-1098 (filed

Ps NEE aor iekdiesUVeen peeventcsciaheoncheeus 14

United Siates v. Moser, 123 F.3d 813 (6th Cir. 1997),

cert. denied, 522 U.S. 1020 and 1035 (1997) and

ae EE ME of bo CEG uG RE ay dowd eee eeekas 16, 18

United States v. $92,422.57, 307 F.3d 137 (3d Cir.

i ho oe Sy we aes wa reaches Cache ec ena 13

United States v. Pindell, 336 F.3d 1049 (D.C Cir.

2003), cert. denied, 540 U.S. 1200 (2004) ............ 12

United States v. Riley, 906 F.2d 841 (2d Cir. 1990)...... 12

United States v. Rude, 88 F.3d 1538 (9th Cir. 1996),

cert. denied, 519 US. 1058 (1997) ... 2... cece cece’ 19

United States v. Sawyer, 799 F.2d 1494 (11th Cir.

1986), cert. denied, 479 U.S. 1069 (1987) ............ 18

United States v. Sells, 463 F.3d 1148 (10th Cir. 2006),

cert. denied, No. 06-8487 (Feb. 20, 2007) ............ 13

United States v. Smith, 424 F.3d 992 (9th Cir. 2005),

cert. denied, 126 S. Ct. 1477 and 1770 (2006) ......... 14

Cases— Continued: Page

United States v. Spilotro, 800 F.2d 959 (9th Cir.

BE rhe Sas eg eWEEK ELVES ETRE OR 20, 21

United States v. Travers, 233 F.3d 1327 (11th Cir.

2000), cert. denied, 534 U.S. 830 (2001) ............. 14

United States v. Ventresca, 380 U.S. 102 (1965) ..... 13, 18

United States v. Wuagneux, 683 F.2d 1343 (11th Cir.

1982), cert. denied, 464 U.S. 814 (1983) ............. 13

United States v. Young, 745 F.2d 733 (2d Cir. 1984),

cert. denied, 470 U.S. 1084 (1985) ...............05. 12

VonderAhe v. Howland, 508 F.2d 364 (9th Cir. 1975) .... 20

Voss v. Bersgaard, 774 F.2d 402 (10th Cir. 1985) ....... 19

Washington State Dep't of Soc. & Health Servs. v.

Guardianship Estate of Keffeler, 537 U.S. 371

BRERA te pare e Bae rnd rrr mre Ty ee ee 13

Constitution and statutes:

U.S. Const.:

PE ois cole vee nce cae cu ob ewes aeee here 20

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18 U.S.C. 3731 (2000 & Supp. IV 2004) ................. 2

In the Supreme Court of the Anited States

No. 06-892

FATHI YUSUF MOHAMMED YUSUF, AKA FATHI YUSUF,

ET AL., PETITIONERS

Vv.

UNITED STATES OF AMERICA

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

BRIEF FOR THE UNITED STATES IN OPPOSITION

OPINIONS BELOW

The opinion of the court of appeals (Pet. App. 1-46)

is reported at 461 F.3d 374. The memorandum opinion

of the district court for the District of the Virgin Islands

(Pet. App. 47-78) is unreported.

JURISDICTION

The judgment of the court of appeals was entered on

August 24, 2006. A petition for rehearing was denied on

October 5, 2006 (Pet. App. 79-80). The petition for a writ

of certiorari was filed on December 28, 2006. The juris-

diction of this Court is invoked under 28 U.S.C. 1254(1).

STATEMENT

Petitioners, a corporation based in the U.S. Virgin

Islands and several of its owners and operators, were

(1)

2

charged in a 78-count indictment with money launder-

ing, currency structuring, various tax violations, mail

fraud, obstruction of justice, and conspiracy. Pet. App.

3. The district court granted a motion to suppress evi-

dence based on a facial challenge to several search war-

rants. Id. at 47-78. On interlocutory appeal under 18

U.S.C. 3731 (2000 & Supp. IV 2004), the court of appeals

reversed and remanded the case for further proceed-

ings. Pet. App. 1-46.

1. Ina series of seven transactions from April 16-19,

2001, United Corporation, a family-owned chain of su-

permarkets in the U.S. Virgin Islands, deposited

$1,940,000 into its account with the Bank of Nova Scotia,

entirely in denominations of $50 or $100. The bank

found the activity suspicious and forwarded a report to

the St. Thomas office of the FBI on July 20, 2001. Fed-

eral investigators immediately launched an investiga-

tion. Pet. App. 5.

On October 19, 2001, the FBI sought search warrants

for three supermarkets, three residences, three individ-

uals, and two safe deposit boxes in the Virgin Islands.

Pet. App. 6-7 n.2. The warrant application included a

sworn affidavit, signed by an FBI agent, describing the

government’s investigation in detail. Some information

in the affidavit had been supplied by the Virgin Islands

Bureau of Internal Revenue (VIBIR). /d. at 3.

The warrant application also contained two exhibits

describing the items to be searched for and seized.

Each warrant, in the space provided to describe the

“property,” contained the words: “See Exhibit ‘B’

marked ‘Evidence’ attached.” See C.A. App. 380. Ex-

hibit B, which was attached to each of the warrants and

was not sealed, Pet. App. 39, contained the following

description:

3

Any and all records, whether typed or handwritten,

or stored on paper, magnetic or electronic medium

(including information stored on computer systems)

of money laundering and illegal business activities,

including Money Laundering and Conspiracy to

Commit Money Laundering, Failure to Report Ex-

porting of Monetary Instruments, Mail Fraud, Wire

Fraud, Alien Smuggling, Food Stamp Fraud, and

Conspiracy to commit the same from 1990 to the

present

pertaining to United Corporation d/b/a Plaza Ex-

tra, Plessen Enterprises, Inc., Hamdan Diamond

Corp., Sixteen Plus Corp. and any affiliated compa-

nies, as well as their principals, officers, managers,

and employees, including but not limited to Fathi

Yusuf, Maher Yusuf, Waleed “Wally” Hamed, and

Waheed “Willy” Hamed; including

1. Audit reports and financial statements of the

above-listed companies and persons;

2. All financial records, including monthly state-

ments, cancelled checks, deposit slips, certificates

of deposit, of any and all banks and financial insti-

tutions where the above-listed companies and

persons have accounts;

3. Any and all securities held or owned by the

above-listed companies and persons and related

records;

4. Any and ali financial instruments, promissory

notes, and letters of credit held or owned by the

above-listed companies and persons and related

records;

4

5. Documents, including corporate documents,

identifying the names, addresses, dates of birth,

telephone numbers, and social security numbers

of all employees, officers, directors, and associ-

ates of the above-listed corporations and compa-

nies;

6. Any and all contracts, agreements, and corre-

spondence;

7. Original contracts, promissory notes, subscrip-

tion forms, purchases’s [sic] receipts, compliance

verification forms, W-9 forms, and correspon-

dences executed or exchanged between United

Corporation d/b/a Plaza Extra and all of its cus-

tomers and associated companies;

8. Copies of all Internal Revenue Service and VI

Bureau of Internal Revenue tax returns or other

reporting forms and supporting schedules and

documentation;

9. Telephone records, Rolodex records, telephone

answering machine tapes;

10. Video tapes, disks or records;

11. Photos, whether recorded on paper, tape, or

disk;

12. Documents and records pertaining to commu-

nication by facsimile (fax) transmissions;

13. Any other records of money laundering and

illegal activities, including but not limited to:

5

books, records, receipts, accounts, notes, logs,

ledgers, journals, worksheets, invoices, pass

books, money drafts, money orders, bank drafts,

cashier checks, bank checks, safety deposit box

keys, and money wrappers, airline tickets, and

addresses and telephone numbers in books or on

paper or stored in electronic form by computer

systems, or word processing equipment.

App., infra, la-38a. Exhibit B also defined the terms

“records,” “information,” and “{cJomputer systems,” and

called for the seizure of large quantities of cash or valu-

ables “collected in a manner designed to facilitate conve-

nient transport.” Jd. at 3a-4a.

On October 19, 2001, a magistrate judge of the

United States District Court for the District of the Vir-

gin Islands issued the warrants. C.A. App. 380. On Oc-

tober 23, 2001, federal agents executed the warrants at

each of the locations described. Based on the evidence

they discovered, a grand jury returned a 78-count indict-

ment charging United Corporation and its owners and

operators with various criminal offenses, including

money laundering, currency structuring, tax violations,

mail fraud, obstruction of justice, and conspiracy. Pet.

App. 3, 12.

2. Some of the information contained in two para-

graphs of the affidavit supporting the search warrant

turned out to be inaccurate. The information, which had

originated in documents provided to the FBI by VIBIR,

overstated the amount of the discrepancy between the

gross receipts reported on United Corporation’s Virgin

Islands tax filings and the gross receipts reported on its

IRS tax filings for 1998, 1999, and 2000. Petitioners

moved to suppress the evidence recovered during the

6

searches, arguing that the warrant was defective be-

cause of the false statements. Pet. App. 16-17.

Following a hearing pursuant to Franks v. Delaware,

438 U.S. 154 (1978), the district court found that certain

statements in the affidavit were made with reckless dis-

regard for the truth. The court therefore excised those

statements and held that the reconstituted affidavit

failed to establish probable cause. Accordingly, the dis-

trict court suppressed all of the evidence seized during

the execution of the search warrants. Pet. App. 3. That

ruling “effectively dismiss[ed] the Government’s case.”

Ibid.

3. The court of appeals reversed. Pet. App. 1-46. It

determined that the FBI agent did not act recklessly in

reporting the tax information provided by VIBIR be-

cause the agent did not have an “obvious reason to doubt

the truth” of the documents provided. /d. at 4. To the

contrary, the court of appeals concluded, the federal

investigators acted with reasonable diligence in verify-

ing the information, and their belief that United had

underreported its gross receipts returns was “eminently

plausible * * * at that point in the investigation.” /d.

at 23-24.

Moreover, the court of appeals held, even if the two

challenged paragraphs of the affidavit were excised, the

reconstituted affidavit “clearly establishes probable

cause.” Pet. App. 25. The affidavit described a series of

bank deposits “made solely in $50 and $100 denomina-

tions,” and the court of appeals found it “utterly incom-

prehensible that a retail supermarket chain receives and

deposits cash only in such large denominations.” /d. at

32. It found the district court’s decision to invalidate the

entire warrant for lack of probable cause “disconcert-

ing.” /d. at 25.

7

The court of appeals also considered, and rejected,

petitioners’ alternative argument that blanket suppres-

sion was required because the warrants were unconsti-

tutional “general warrants” that violated the Fourth

Amendment.’ Pet. App. 36-38. Specifically, the court of

appeals considered three claims: (1) that the warrants

failed to describe the property to be searched and seized

with particularity because they did not incorporate the

affidavit, citing Groh v. Ramirez, 540 U.S. 551 (2004),

Pet. App: 36, 38; (2) that the warrants referred to the

crimes committed by name, rather than “by reference to

the statutory elements in the United States Code,” id. at

36; and (3) that the catch-all provision in paragraph 13

of Exhibit B, which allowed the agents to search for re-

cords of “money laundering and illegal activities,” App.,

infra, 2a, gave agents unfettered discretion to conduct

a general search. Pet. App. 36.

First, the court of appeals rejected petitioners’ reli-

ance on Groh. In that case, the warrant failed to incor-

porate the portion of the affidavit describing the items

to be seized, and as a result the warrant “failed to iden-

tify any of the items that [the agent] intended to seize.”

Pet. App. 39 (quoting Groh, 540 U.S. at 554 (emphasis

and alteration in the decision of the court of appeals)).

Here, by contrast, the warrants expressly incorporated

the attached Exhibit B, which described at length the

items to be seized. /bid. Thus, the court of appeals

' Because it found no constitutional defect in the warrants, the court

of appeals did not need to consider the government’s alternative argu-

ments that some of the evidence was admissible under the inevitable

discovery doctrine, and that petitioners lacked a legitimate expectation

of privacy in certain areas of the grocery stores that were searched.

See Gov't C.A. Br. 50, 53; Govt. C.A. Reply Br. 22, 25.

8

held, “the problem which existed in Groh is simply not

implicated in this case.” Ibid.

Second, the court of appeals held that the warrants

described the property to be searched and seized with

sufficient particularity, notwithstanding their references

to several federal crimes by name, rather than by refer-

ence to relevant provisions of the criminal code. Citing

its decisions in United States v. American Investors of

Pittsburgh, Inc., 879 F.2d 1087 (3d Cir.), cert. denied,

493 U.S. 955 (1989) and 493 U.S. 1021 (1990), and United

States v. Kepner, 843 F.2d 755 (3d Cir. 1988), the court

noted that “the breadth of items to be searched depends

upon the particular factual context of each case and also

the information available to the investigating agent that

could limit the search at the time the warrant applica-

tion is given to the magistrate.” Pet. App. 40-42. In this

case, the court noted, Exhibit B contained several ex-

press limitations, restricting agents to evidence of enu-

merated federal crimes, narrowing the scope of the

search to evidence from 1990 to the date of the search in

2001, and limiting the search to records “pertaining to”

specific corporations and individuals. /d. at 42. Al-

though the warrants authorized a broad search, the

court of appeals emphasized that “the government was

conducting an investigation into money laundering and

other complex white collar crimes,” and that investiga-

tors must have “more flexibility regarding the items to

be searched when the criminal activity deals with com-

plex financial transactions.” /d. at 43. Indeed, the court

found, “it is difficult to conclude how the Government

could have more narrowly tailored the warrant in this

money laundering investigation.” /bid.

Third, the court of appeals found no constitutional

defect in the catch-all provision in paragraph 13 of Ex-

9

hibit B, which authorized the seizure of records of

“money laundering and illegal activities.” Pet. App. 44.

Relying on this Court’s decision in Andresen v. Mary-

land, 427 U.S. 463, 479-482 (1976), the court of appeals

construed the phrase “illegal activities” to refer to the

list of “illegal business activities” set forth in the open-

ing paragraph of Exhibit B, and not to all illegal activi-

ties of any kind. Pet. App. 44. The court therefore

found it “clear” that “paragraph 13 does not transform

the warrants into general warrants.” Jd. at 45.

ARGUMENT

Petitioners contend (Pet. 9-11) that the search war-

rants in this case permitted unconstitutional general

searches. They construe the warrants as permitting the

seizure of all records of “illegal activities,” and argue .

that the manner in which the warrants referred to spe-

cific criminal offenses rendered them impermissibly

overbroad. The court of appeals correctly rejected both

arguments based on a careful reading of Exhibit B and

a determination that, under the circumstances, no more

particularized description of the items to be seized was

possible. Pet. App. 36-45. Its factbound conclusion does

not conflict with the decisions of this Court or other

courts of appeals. Further review is unwarranted.

1. Petitioners’ principal argument (Pet. 13-14) is that

paragraph 13 of Exhibit B authorized a general search

for evidence of “illegal activities.” This Court rejected

a Virtually identical claim in Andresen v. Maryland, 427

U.S. 463 (1976).

The Fourth Amendment provides that “no Warrants

shall issue, but upon probable cause, supported by Oath

or affirmation, and particularly describing the place to

be searched, and the persons or things to be seized.”

10

U.S. Const. Amend. IV. In Andresen, 427 U.S. at 465,

police had probable cause to believe that an attorney

had defrauded the purchaser of a particular lot in a sub-

division of Montgomery County, Maryland. Police ob-

tained several warrants authorizing the search of the

attorney’s office and the seizure of specific documents

relevant to that transaction “together with other fruits,

instrumentalities and evidence of crime at this [time]

unknown.” /d. at 480-481 n.10 (internal quotation marks

omitted).” The attorney challenged the warrants based

on the Fourth Amendment’s particularity requirement,

* The description of the items to be searched for and seized stated in

full:

[T]he following items pertaining to sale, purchase, settlement and

conveyance of lot 13, block T, Potomac Woods subdivision, Montgom-

ery County, Maryland:

title notes, title abstracts, title rundowns; contracts of sale and/or

assignments from Raffaele Antonelli and Rocco Caniglia to Mount

Vernon Development Corporation and/or others; lien payoff corre-

spondence and lien pay-off memoranda to and from lienholders and

noteholders; correspondence and memoranda to and from trustees

of deeds of trust; lenders instructions for a construction loan or

construction and permanent loan; disbursement sheets and dis-

bursement memoranda; checks, check stubs and ledger sheets

indicating disbursement upon settlement; correspondence and

memoranda concerning disbursements upon settlement; settlement

state ments and settlement memoranda; fully or partially prepared

deed of trust releases, whether or not executed and whether or not

recorded; books, records, documents, papers, memoranda and

correspondence, showing or tending to show a fraudulent intent,

and/or knowledge as elements of the crime of false pretenses, in

violation of Article 27, Section 140, of the Annotated Code of Mary-

land, 1957 Edition, as amended and revised, together with other

fruits, instrumentalities and evidence of crime at this [time] un-

known.

Andresen, 427 U.S. at 480-481 n.10 (internal quotation marks omitted).

11

calling the terms of the warrants “so broad as to make

them impermissible ‘general’ warrants.” /d. at 478.

This Court disagreed, noting that “the warrants for

the most part were models of particularity” and reject-

ing the argument “that they were rendered fatally ‘gen-

eral’ by the addition, in each warrant, to the exhaustive

list of particularly described documents, of the phrase

‘together with other fruits, instrumentalities and evi-

dence of crime at this [time] unknown.’” Andresen, 427

U.S. at 479. That phrase, the Court emphasized, did not

form part of “a separate sentence” but instead “ap-

pear[ed] in each warrant at the end of a sentence con-

taining a lengthy list of specified and particular items to

be seized.” Jd. at 480. Because each of the items in that

list “follow[ed| the colon after the word ‘Maryland,’”

each “clause|| in the series [was] limited by what pre-

cedes that colon, namely, ‘items pertaining to . . . lot

13, block T.’” Jd. at 481. The Court therefore found it

“clear from the context that the term ‘crime’ in the war-

rants refers only to the crime of false pretenses with

respect to the sale of Lot 13T.” Jd. at 480-481.

The Court recognized the dangers “inherent in exe-

cuting a warrant authorizing a search and seizure of a

person’s papers.” -Andresen, 427 U.S. at 482 n.11. In

such a search, the Court observed, “it is certain that

some innocuous documents will be examined, at least

cursorily, in order to determine whether they are, in

fact, among those papers authorized to be seized.” /bid.

Nonetheless, the Court found no constitutionai defect in

the warrant language. Because the police were investi-

gating a “complex real estate scheme whose existence

could be proved only by piecing together many bits of

evidence,” the warrant had to sweep broadly to reach

each piece of the “jigsaw puzzle.” /d. at 481 n.10. The

12

Court admonished that “[t]he complexity of an illegal

scheme may not be used as a shield to avoid detection.”

Ibid.

Based on Andresen, courts of appeals routinely inter-

pret the “catch-all phrase” in a warrant “in light of the

items that precede it.” United States v. Pindell, 336

F.3d 1049, 1053 (D.C. Cir. 2003), cert. denied, 540 U.S.

1200 (2004). See United States v. Riley, 906 F.2d 841,

844 (2d Cir. 1990) (“In upholding broadly worded cate-

gories of items available for seizure, we have noted that

the language of a warrant is to be construed in light of

an illustrative list of seizable items.”).? That interpre-

tive approach follows from the “established interpretive

canon|s|” noscitur a sociis and ejusdem generis,

Pindell, 336 F.3d at 1053, which counsel that “[w]here

* See, eg., Pindell, 336 F.3d at 1058 (rejecting a particularity

challenge to warrants that authorized the seizure of “any other evidence

of a violation of Title 18 U.S.C. § 242” because that language appeared

“in the same sentence as, and at the conclusion of, a quite specific list of

items to be seized,” making it “reasonably clear that the warrants did

not authorize the seizure of evidence of just any violation of § 242”);

United States v. Ables, 167 F.3d 1021, 1033-1034 (6th Cir.) (construing

search warrants as describing the items to be seized with particularity,

notwithstanding a phrase authorizing the seizure of “other items

evidencing” certain financial transactions, because the warrants con-

tained an “illustrative list of items” that “supplied sufficient examples

of the items that the IRS was authorized to seize—bank statements,

money drafts, letters of credit, money orders, cashier’s checks, pass

books, bank checks, automatic teller machine receipts, Western Union

receipts, etc.” to prevent “general exploratory rummaging” by the

police), cert. denied, 527 U.S. 1027 (1999); United States v. Young, 745

F.2d 733, 758-759 (2d Cir. 1984) (finding no constitutional defect in a

warrant containing “boilerplate language” that authorized the seizure

of “other evidence” of a drug conspiracy because that language “fol-

lowed a list of more specific items to be seized, and could be construed

only in conjunction with that list”), cert. denied, 470 U.S. 1084 (1985).

13

general words follow specific words * * * the general

words are construed to embrace only objects similar in

nature to those objects enumerated by the preceding

specific words,” Washington State Dep't of Soc. &

Health Servs. v. Guardianship Estate of Keffeler, 537

U.S. 371, 384 (2003) (quoting Circuit City Stores, Ince. v.

Adams, 532 U.S. 105, 114-115 (2001)). It also accords

with the general rule that courts should interpret war-

rants and supporting affidavits in a “commonsense,”

rather than “hypertechnical,” manner. /llinois v. Gates,

462 U.S. 213, 236 (1983) (citation omitted); United States

v. Sells, 463 F.3d 1148, 1156 (10th Cir. 2006), cert. de-

nied, No. 06-8487 (Feb. 20, 2007); United States v.

Gendron, 18 F.3d 955, 966 (1st Cir.) (Breyer, C.J.), cert.

denied, 513 U.S. 1051 (1994). See United States v.

Ventresca, 380 U.S. 102, 108 (1965) (“Technical require-

ments * * * have no proper place in this area.”).

Courts of appeals also “universally recognize[ |” that

the Fourth Amendment’s particularity requirement

“must be applied with a practical margin of flexibility,

depending on the type of property to be seized, and

that a description of property will be acceptable if it is

as specific as the circumstances and nature of activity

under investigation permit.” United States v. Wuag-

neux, 683 F.2d 1343, 1349 (11th Cir. 1982) (collecting

cases), cert. denied, 464 U.S. 814 (1983). Accordingly,

when interpreting search warrants in cases “involving

complex financial transactions and widespread allega-

tions of various types of fraud,” courts recognize that an

extensive search of business records may be necessary.

Ibid.* Several courts of appeals have upheld warrants

* See,e.g., United States v. $92,422.57, 307 F.3d 137, 149-150 (3d Cir.

2002) (Alito, J.) (finding that a warrant authorizing the seizure of “|rle-

14

calling for the seizure of all business records of an enter-

prise based on probable cause to believe that the enter-

prise was engaged in a “pervasive scheme to defraud.”

United States v. Martinelli, 454 F.3d 1300, 1307 (11th

Cir. 2006) (citation omitted), petition for cert. pending,

No. 06-1098 (filed Feb. 5, 2007); United States v. Smith,

424 F.3d 992, 1004-1006 (9th Cir. 2005), cert. denied, 126

S. Ct. 1477 and 1770 (2006); Marvin v. United States,

732 F.2d 669, 674 (8th Cir. 1984); United States v. Brien,

617 F.2d 299, 309 (1st Cir.), cert. denied, 446 U.S. 919

(1980).

In this case, paragraph 13 of Exhibit B authorized a

search for “|a|ny other records of money laundering and

illegal activities.” App., infra, 2a. Contrary to petition-

ers’ claim that paragraph 13 granted the FBI unlimited

discretion to search for evidence of illegal activities, that

clause must be construed in light of the preceding list of

records and other limitations on the scope of the search.

Pet. App. 44-45. Like the clause challenged in Andre-

sen, paragraph 13 is a “catch-all” that appears at the

ceipts, invoices, lists of business associates, delivery schedules, ledgers,

financial statements, cash receipts, disbursement, and sales jour-

nals,and correspondence” was “indubitably broad, but * * * not

‘reneral’” in light of the purpose of the investigation and the suspected

underlying criminal activity); United States v. Logan, 250 F.3d 350, 365

(6th Cir.) (noting that “{a] description contained in a warrant is

sufficiently particular if it is as specific as the circumstances and the

nature of the alleged crime permit,” and upholding warrant language

based on the complexity and nature of the suspected fraud), cert.

denied, 534 U.S. 895 and 997 (2001); United States v. Travers, 233 F.3d

1327, 1330 (11th Cir. 2000) (recognizing, in a case where the charges

included “mail fraud, bankruptcy fraud, equity skimming, and money

laundering,” that “cases involving ‘complex financial fraud . . . justify

a more flexible reading of the fourth amendment particularity require-

ment’”) (citation omitted), cert. denied, 534 U.S. 830 (2001).

15

end of a long sentence listing specific records subject to

search and seizure. 427 U.S. at 479. Indeed, because it

extends only to “other records of money laundering and

illegal activities,” App., infra, 2a (emphasis added),

paragraph 13 cannot be understood except by reference

to the kind of records of money laundering and illegal

activities described earlier in Exhibit B. Similarly, the

phrase “money laundering and illegal activities” in para-

graph 13 plainly echoes the introductory description of

the crimes for which the FBI had probable cause:

“money laundering and illegal business activities, in-

cluding Money Laundering and Conspiracy to Commit

Money Laundering, Failure to Report Exporting of

Monetary Instruments, Mail Fraud, Wire Fraud, Alien

Smuggling, Food Stamp Fraud, and Conspiracy to com-

mit the same.” /d. at la (emphasis added). Read “with{]

reference to the rest of the long sentence at the end of

which it appears,” Andresen, 427 U.S. at 479, paragraph

13 operates merely to include additional types of busi-

ness records not described in paragraphs 1-12 but re-

lated to the same alleged criminal activities.

Under the circumstances, the warrants could not

have contained a more particularized description of the

items to be seized. The court of appeals held, and peti-

tioners no longer challenge, that the FBI had probable

cause to believe that United Corporation and its princi-

pals had engaged in money laundering, mail and wire

fraud, and reporting violations. Pet. App. 32-36. The

affidavit accompanying the warrants also described the

FBI’s suspicions of alien smuggling and food stamp

fraud. Jd. at 61-64. Because the investigation involved

a “massive white collar scheme” and allegations of per-

vasive fraud, 7d. at 43, the search warrants reasonably

called for an extensive search of business records per-

16

taining to United Corporation and its affiliates and prin-

cipals. Based on an assessment of the affidavit and

search warrants, the court of appeals found it “difficult

to conclude how the Government could have more nar-

rowly tailored the warrant in this money laundering in-

vestigation.” /bid. That factbound determination, like

the court’s resolution of the dispute over the proper con-

struction of Exhibit B, does not warrant further review

by this Court.’

2. Petitioners also argue (Pet. 16-18) that the refer-

ences to criminal offenses in Exhibit B violated the

Fourth Amendment’s particularity requirement in two

ways. First, they note (Pet. 16) that money laundering,

mail fraud, and wire fraud are “generic offenses deriva-

tive of other * * * criminal conduct.” Second, they

object (Pet. 17) that Exhibit B refers to criminal of-

» Petitioners’ reliance (Pet. 11-13) on Groh v. Ramirez, 540 U.S. 551

(2004), is misplaced. Groh held that a warrant application that “ade-

quately describe[s] the ‘things to be seized’” cannot “save the warrant

from its facial invalidity,” but expressly held open the possibility that

“a court may construe a warrant with reference to a supporting applica-

tion or affidavit if the warrant uses appropriate words of incorporation,

and if the supporting document accompanies the warrant.” Jd. at 557-

558. In this case, the government makes no claim that the affidavit

itself operates to constrain the scope of the search. Instead, the gov-

ernment relies on the language of Exhibit B, which was expressly incor-

porated into and attached to each warrant. See C.A. App. 380 (“Exhibit

‘B’ marked ‘Evidence’ attached.”); United States v. Moser, 123 F.3d

813, 823 n.7 (6th Cir. 1997) (finding attachment of the affidavit irrele-

vant because “exhibit B (not the affidavit) was the document that

limited the agents’ discretion by describing with sufficient particularity

the types of items to be seized, and exhibit B was attached to (and

expressly referenced by) the search warrant”), cert. denied, 522 U.S.

1020 and 1035 (1997) and 522 U.S. 1092 (1998). Thus, as the court of

appeals recognized, “the problem which existed in Groh is simply not

implicated in this case.” Pet. App. 39.

17

fenses by name, rather than describing their elements

or citing particular section numbers within the United

States Code. Because no court of appeals has accepted

those arguments, further review by this Court is unwar-

ranted.

As the court of appeals emphasized, the warrants in

this case constrained the scope of the search in three

ways: (1) “they specified that agents were searching for

evidence of several specifically enumerated federal

crimes”; (2) they restricted investigators “to evidence

from 1990 to the date of the search in October 2001”;

and (3) they restricted the search to records “pertaining

to” United Corporation and its affiliated companies,

principals, and employees. Pet. App. 42. Because those

restrictions appear before the semicolon that introduces

the numbered paragraphs, the records described in each

“clause[] in the series” must satisfy those offense, time,

and subject-matter requirements. See Andresen, 427

U.S. at 481. Under the circumstances, the warrants de-

scribe the items to be seized with reasonable particular-

ity. Pet. App. 42-43.

Petitioners note that three of the criminal offenses

named in Exhibit B, mail fraud (see 18 U.S.C. 1341),

wire fraud (see 18-U.S.C. 1343), and money laundering

(see 18 U.S.C. 1956 and 1957), depend on other underly-

ing criminal concuct: “specified unlawful activity” in the

case of money laundering, 18 U.S.C. 1956(a)(1), or a

“scheme or artifice to defraud” in the case of mail or

wire fraud, 18 U.S.C. 1341, 13843. They argue that nam-

ing those offenses, which are derivative of other of-

fenses, violates the Fourth Amendment’s particularity

requirement by sweeping in a wide range of other crimi-

nal conduct.

18

No court of appeals has embraced such a rule, and

several have rejected it, at least implicitly. The inclu-

sion of money laundering, mail fraud, and wire fraud in

the list can be reasonably construed to refer only to the

unique elements of those offenses, as distinct from the

underlying specified unlawful activity or scheme to de-

fraud. See Gates, 462 U.S. at 236 (1983) (adopting a

“commonsense” rather than “hypertechnical” construc-

tion of the affidavit accompanying a warrant) (quoting

Ventresca, 380 U.S. at 109). Under the circumstances of

this case, no more particularized description of the sus-

pected criminal offenses was possible. The structured

deposits, detected by petitioners’ bank and reported to

® See United States v. Ervasti, 201 F.3d 1029, 1039 & n.7 (8th Cir.

2000) (finding no constitutional defect in a warrant that authorized the

seizure of a host of business records “all of which are evidence of vio-

lations of Title 18, [U.S.C.], Sections 1341 and 1343 [mail and wire

fraud], and Title 26, | U.S.C. ], Section 7212(a) [interference with admini-

stration of tax laws], for the period of 1991 to present”); Moser, 123

F.3d at 823 (finding no violation of the particularity requirement where

the warrant authorized the seizure of “property designated and in-

tended for use and which is and has been used as a means of committing

an offense concerning a violation of Title 18, United States Code, Sec-

tion 1341,” which criminalizes mail fraud); United States v. Sawyer, 799

F.2d 1494, 1508-1509 & n.15 (11th Cir. 1986) (finding no violation of the

particularity requirement where the warrant authorized the search and

seizure of a wide range of documents and records “which are evidence

and fruits of, and the means of commission of violations of Title 18, U.S.

Code, Sections 1341, 1343, 371 and violations of the Commodity Ex-

change Act, Title 7, U.S. Code, Section 6(b) 60(1)”), cert. denied, 479

U.S. 1069 (1987); United States v. Lamport, 787 F.2d 474, 476 (10th

Cir.) (upholding a warrant that called for a search of various specific

items along with “any other property that constitutes evidence of the

commission of the criminal offense, Title 18, United States Code, Sec-

tion 1341 (Mail Fraud),” based on the circumstances of the investiga-

tion), cert. denied, 479 U.S. 846 (1986).

19

the FBI, strongly suggested an effort to transfer almost

$2 million in a manner that would avoid detection.

Based on those deposits and other evidence obtained by

the FBI before applying for the warrants, investigators

had probable cause to believe that petitioners had en-

gaged in money laundering or mail or wire fraud, but

could not be certain as to the original source of the

funds. Pet. App. 32-35.

Petitioners also fault the affidavit for referring to

each criminal offense “by its generic name” rather than

describing its elements or specifying a “location within

the United States Code.” Pet. 17; see Pet. 6. Again, no

court has embraced that argument, and at least one

court of appeals has rejeeted it. See United States v.

Rude, 88 F.3d 1538, 1551 (9th Cir. 1996) (finding no con-

stitutional defect in a warrant that authorized the sei-

zure of a host of business records and other items

“traceable to fraud and money laundering,” and specifi-

cally rejecting the argument that the warrant “failed to

state with particularity any guidelines for the agents to

determine objectively whether a document to be seized

related to wire fraud or money laundering”), cert. de-

nied, 519 U.S. 1058 (1997).

The cases on which petitioners rely (Pet. 17-18)

are readily distinguishable. Three decisions, Rickert

v. Sweeney, 813 F.2d 907, 909 (8th Cir. 1987), Voss v.

Bergsgaard, 774 F.2d 402, 405 (10th Cir. 1985), and

Jnited States v. Cardwell, 680 F.2d 75, 77 (9th Cir.

1982), hold only that a bare reference to the general con-

spiracy or tax evasion statutes places no effective limit

on the scope of a warrant. In Rickert, the court held

that “probable cause existed only to search for evidence

of tax evasion in connection with one particular project,”

and invalidated a warrant that authorized the seizure of

20

records related to all projects. 813 F.2d at 909. Simi-

larly, in Voss, the court held that probable cause existed

only as to the existence of “a substantial tax fraud

scheme,” and could not justify the seizure of all of an

organization’s records, including those related to lawful

- political advocacy protected by the First Amendment.

774 F.2d at 406. In Cardwell, the defect was particu-

larly clear because IRS agents were “already focused

* * * on certain portions of the appellants’ business

record”: “the government knew exactly what it needed

and wanted and where the records were located,” but

nonetheless obtained a warrant authorizing a “massive

re-examination” of the defendant’s records. 680 F.2d at

78 (quoting VonderAhe v. Howland, 508 F.2d 364, 370

(9th Cir. 1975)).'

‘ The other decisions cited by petitioners are factually inapposite for

the same reason. In United States v. Abrams, 615 F.2d 541, 542-543

(1st Cir. 1980), investigators suspected that three doctors had submit-

ted false Medicare and Medicaid claims, but because of the broad de-

scription in the search warrant, officers seized all patient records, in-

cluding the “records of non-Medicare-Medicaid patients.” In /n re

Lafayette Academy, Inc.,610 F.2d 1,3 (1st Cir. 1979), investigators had

probable cause to believe that a school had engaged in fraud in connec-

tion with the Federal Insured Student Loan Program (FISLP), but

obtained a warrant that authorized the seizure of four truckloads of the

school’s business and student records, including records having no

possible connection to FISLP. Both cases involve warrants that swept

more broadly than the showing of probable cause.

Petitioners’ reliance on U/nited States v. Spilotro, 800 F.2d 959 (9th

Cir. 1986) (Kennedy, J.), is also misguided. The warrants in that case

called for the seizure of “notebooks, notes, documents, address books,

and other records; safe deposit box keys, cash, and other assets; photo-

graphs, equipment including electronic scanning devices, and other

items and paraphernalia, which are evidence of violations of 18 U.S.C.

1084, 1952, 892-894, 371, 1503, 1511, 2314, 2315, 1962-1963." Jd. at 962.

The court held that the warrants lacked particularity because “the

21

In this case, by contrast, the court of appeals found

it “difficult to conclude how the Government could have

more narrowly tailored the warrant” in light of the size,

complexity, and pervasiveness of petitioners’ suspected

money laundering, tax violations, and fraud. Pet. App.

43. Petitioners make no effort to compare the evidence

described in the warrant application with the scope of

the search authorized in Exhibit B, and instead seize

upon individual phrases which, in isolation, could sug-

gest an impermissibly broad authority to search. The

court of appeals, on the other hand, painstakingly com-

pared the supporting affidavit with the scope of the war-

rant, noting that “the government needed to search for

a broad array of corporate documents to piece together

United’s unexplained large-scale currency deposits” and

concluding that the “financial records, sales records, tax

records, and purchase records” described in Exhibit B

“are all probative of the cash flow” and “could establish

the massive white collar scheme the Government has

alleged in this case.” /bid. Based on the nature of the

investigation and the warrant’s express limitations, the

court of appeals held that “the warrant here was drafted

government could have narrowed most of the descriptions in the

warrants either by describing in greater detail the items one commonly

expects to find on premises used for the criminal activities in question,

or, at the very least, by describing the criminal activities themselves

rather than simply referring to the statute believed to have been

violated.” /d. at 964. Here, the government followed both of those

instructions. Exhibit B includes 12 paragraphs describing, at length,

the types of records that typically contain information relevant to the

criminal activities listed, along with a “catch-all” provision in paragraph

12. See App., infra, la-2a. It also listed specific criminal offenses by

name, rather than merely citing section numbers of the United States

Code. Id. at la.

22

with sufficient particularity.” /d. at 42-43. Further re-

view of that fact-intensive inquiry is unwarranted.

CONCLUSION

The petition for a writ of certiorari should be denied.

Respectfully submitted.

PAUL D. CLEMENT

Solicitor General

EILEEN J. O°CONNOR

Assistant Attorney General

ALAN HECHTKOPF

S. ROBERT LYONS

Attorneys

MARCH 2007

APPENDIX

Exhibit “B”

Evidence

a. Any and all records, whether typed or hand-

written, or stored on paper, magnetic or electronic

medium (including information stored on computer

systems) or money laundering and illegal business

activities, including Money Laundering and Conspiracy

to Commit Money Laundering, Failure to Report Ex-

porting of Monetary Instruments, Mail Fraud, Wire

Fraud, Alien Smuggling, Food Stamp Fraud, and

Conspiracy to commit the same from 1990 to the present

pertaining to United Corporation d/b/a Plaza Extra,

Plessen Enterprises, Inc., Hamdan Diamond Corp.,

Sixteen Plus Corp. and any affiliated companies, as well

as their principals, officers, managers, and employees,

including but not limited to Fathi Yusuf, Maher Yusuf,

Waleed “Wally” Hamed, and Waheed “Willy” Hamed;

including

1. Audit reports and financial statements of the

above-listed companies and persons;

2. All financial records, including monthly

statements, cancelled checks, deposit slips, certificates

of deposit, of any and all banks and financial institutions

where the above-listed companies and persons have

accounts;

3. Any and all securities held or owned by the

above-listed companies and persons and related records;

(la)

2a

4. Any and all financial instruments, promissory

notes, and letters of credit held or owned by the above-

listed companies and persons and related records;

5. Documents, including corporate documents,

identifying the names, addresses, dates of birth,

telephone numbers, and social security numbers of all

employees, officers, directors, and associates of the

above-listed corporations and companies;

6. Any and all contracts, agreements, and corres-

pondence; -

7. Original contracts, promissory notes, sub-

scription forms, purchases’s receipts, compliance verifi-

cation forms, W-9 forms, and correspondences executed

or exchanged between United Corporation d/b/a Plaza

Extra and all of its customers and associated companies;

8. Copies of all Internal Revenue Service and VI

Bureau of Internal Revenue tax returns or other report-

ing forms and supporting schedules and documentation;

9. Telephone records, Rolodex records, telephone

answering machine tapes;

10. Video tapes, disks or records;

11. Photos, whether recorded on paper, tape, or

disk;

12. Documents and records pertaining to com-

munication by facsimile (fax) transmissions;

13. Any other records of money laundering and

illegal activities, including but not limited to:

books, records, receipts, accounts, notes, logs, led-

gers, journals, worksheets, invoices, pass books, money

drafts, money orders, bank drafts, cashier checks, bank

3a

checks, safety deposit box keys, and money wrappers,

airline tickets, and addresses and telephone numbers in

beoks or on paper or stored in electronic form by

computer systems, or word processing equipment.

The terms “records” and “information” include:

all of the foregoing items of evidence in whatever

form and by whatever means they may have been

created or stored, including any electrical, electronic, or

magnetic form (such as any information on an electronic

or magnetic storage device, including floppy diskettes,

hard disks, ZIP disks, CD-ROMs, optical dises, backup

tapes, printer buffers, smart cards, memory calculators,

pagers, personal digital assistants such as Palm Pilot

computers, as well as printouts or readouts from any

magnetic storage device); any handmade form (such as

writing, drawing, painting); any mechanical form (such

as printing or typing); and any photographic form (such

as microfilm, microfiche, prints, slides, negatives, video-

tapes, motion pictures, photocopies).

Computer systems include:

computer hardware, meaning hard disks, floppy

disks, magnetic tape, central processing units, monitors,

keyboards, connecting wires, printers, modems, plot-

ters, encryptions, circuits boards, optical scanners, ex-

ternal hard drives, computer storage facilities, all elec-

tronic devices which are capable of analyzing, creating,

displaying converting, or transmitting electronic or

magnetic computer impulses or data, and other com-

puter related devices; and

computer software, meaning any and all instructions

or programs stored in the form of electronic or magnetic

media which are capable of being interpreted by a

4a

computer or related component, including operating sys-

tems, application software, utility programs, compilers,

interpreters, and other programs or software used to

communicate with computer hardware or peripherals,

either directly or indirectly, via telephone lines, radio, or

other means of transmissions, and computer instruction

manuals for the use of any computers and their acces-

sories found at the premises; and

recorded information pertaining to any e-mail stored

on computers, e-mail servers, mail gateways, logs and

other reads pertaining to e-mail, including all stored

files, e-mail messages, attached documents, and web

pages; all files and transactional logs associated with e-

mail, including all telephone numbers used to access e-

mail, dates, times, method of connecting, port, dial-up,

location, attached file names and sizes, and user names,

and all billing records, account history, and subscriber

information related to e-mail; and

b. any large accumulations or bundles of US cur-

rency, precious metals, precious stones and jewelry

stored or collected in a manner designed to facilitate

convenient transport, exclusive of cash or valuables that

are kept in a manner clearly consistent with the normal

operation of legitimate business or normal personal

affairs.