United States v. Xu

Summarized by:

  • Court: 9th Circuit Court of Appeals Archives
  • Area(s) of Law: Criminal Law
  • Date Filed: 01-03-2013
  • Case #: 09-10189, 09-10193, 09-10201; 09-10202
  • Judge(s)/Court Below: Circuit Judge Goodwin for the Court, Circuit Judges Reinhardt and Murguia
  • Full Text Opinion

“When a statute gives no clear indication of an extraterritorial application, it has none.” However, there is "express legislative intent to punish patterns of organized criminal activity in the United States" and under RICO, conspiracy convictions are not the result of "improper extraterritorial application" when the pattern of defendants’ criminal enterprise involved both the foreign country and the United States.

Xu Chaofan, Xu Guojun, Yu Ying Yi, and Kuang Wan Fang (Defendants) were charged with diverting money from the Bank of China, forging auditing reports, and using stolen funds to make fraudulent loans, to purchase real estate, and to fund gambling trips to casinos. Each fraudulently married a spouse with valid United States immigration status, fled to the United States with falsified immigration documents, and were arrested and tried in the District Court for the District of Nevada. They challenged their convictions and a restitution order, claiming primarily that the Racketeer Influenced and Corrupt Organizations Act (“RICO”) does not apply to their “extraterritorial conduct.” The Court acknowledged that RICO is silent regarding extraterritorial application, citing precedents holding, “[w]hen a statute gives no clear indication of an extraterritorial application, it has none.” However, the cumulative interaction of the Defendants within the U.S. (including using fraudulent visas/ passports, traveling in furtherance of immigration fraud, opening bank accounts, and being arrested) led the Court to say, “Defendants engaged in an enterprise that had the implicit goal to breach United States immigration law in furtherance of the overall goal of the enterprise.” The Court determined that “Defendants’ violations of United States immigration laws fall squarely within RICO’s definition of racketeering activity.” Further, the Court found evidence to substantiate money laundering and conspiracy to transport stolen money convictions. The Court determined that Defendants failed to prove plain error for their video depositions claim, and to prove the jury instructions were misleading or inadequate. The Court did conclude, however, that the district court erred procedurally by improperly applying an enhancement based on foreign conduct, “and failed to provide an adequate legal and factual basis for the $482 million restitution order.” Convictions AFFIRMED, sentencing VACATED and REMANDED for sentencing.

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