RICO Comes to the January 6 Investigation — But Not the Way You Think

Longterm readers of this site know that bmaz always gets incensed when people discuss RICO, mostly because those discussions tend towards magical thinking that RICO can make complex legal questions magically result in jail time for bad guys.

That’s why I put RICO in the title.

But RICO really has come up in a January 6 case: pertaining to DOJ’s attempted seizure of the $90,000 John Sullivan made off selling his video of the insurrection. Much of that filing dismisses Sullivan’s attempt to keep the money because he needs it for living expenses. If he genuinely needed it to pay his lawyer, he might have an argument, but DOJ says he’s got other bank accounts with significant funds for that.

Here, the defendant has submitted no declaration, financial affidavit, or banking statements. He has not provided any information about his assets outside his bank account ending in 7715, the only account from which funds were seized. He has not provided information about his short- or long-term liabilities. He has not detailed his sources of income, despite being, to the government’s understanding, currently employed by his father. He has not described his ability to use other assets, liquid and non-liquid, to pay basic necessities, including the assistance of family members and friends. He has not provided information regarding what funds he has recently expended toward household expenses and what any additional funds are requested, nor detailed what the “household expenses” entail. Such specification is particularly essential where expenditures can dramatically vary, irrespective of necessity, based on a defendant’s typical lifestyle. Cf. United States v. Egan, 2010 WL 3000000, at *2 (S.D.N.Y. July 29, 2010) (“The Court does not take lightly a request to release funds allegedly stolen from former customers in order to finance luxuries” such as high-end vehicles or a multimillion-dollar home”).

A more fulsome showing is particularly warranted in light of the defendant’s Pretrial Services Report from the arresting jurisdiction, which was prepared from an interview conducted on January 15, 2021 and, according to D.C. Pretrial Services, submitted to this Court with the Rule 5 papers. That document reported significant funds in unspecified bank accounts of the defendant – funds that wholly predate, and lie entirely outside the scope of, the government’s seizure warrants. The government’s seizure warrants instead surgically targeted the defendant’s $90,875 in proceeds from sales of his video footage from the U.S. Capitol – all of which was deposited into his bank account subsequent to January 15. The Pretrial Services Report further noted multiple vehicles owned by the defendant. And it provided a specific estimate of the defendant’s monthly expenses to include rent, groceries, cell phone, auto insurance, and other incidentals – which, if extrapolated, should mean that the defendant retains substantial assets notwithstanding the government’s seizure of the $62,813.76 on April 29, 2021.

The government, moreover, is aware of at least one other bank account of the defendant with America First Credit Union in which he retained a positive balance as of March 19, 2021. Again, this account and the funds therein lie wholly outside the scope of the government’s seizure warrants.

But there’s a part of the filing that probably answers a question I asked: aside from the First Amendment concerns of seizing funds from making a video, I wondered why DOJ had invoked the obstruction charge against Sullivan to do so, rather than the civil disorder charge, as the basis for the seizure. There’s more evidence that Sullivan was trying to maximize chaos than obstruct the counting of the vote, so it seemed like civil disorder was the more appropriate felony.

It seems that invoking obstruction gave DOJ a way to seize the funds, and even then it had to go through RICO magic.

Here’s the language in question: I’ve highlighted the RICO reference in bright red letters for bmaz’s benefit.

Title 18, United States Code, Section 981(a)(1)(C) provides that “[a]ny property, real or personal, which constitutes or is derived from proceeds traceable to a violation of … any offense constituting ‘specified unlawful activity’ (as defined in section 1956(c)(7) of [Title 18 of the U.S. Code])” is “subject to forfeiture to the United States.” The provision thus subjects “proceeds” traceable to violations of specified unlawful activities (“SUAs”) to civil forfeiture. Meanwhile, criminal forfeiture is authorized when 18 U.S.C. § 981(a)(1)(C) is used in conjunction with 28 U.S.C. § 2461(c), which holds that “[i]f the defendant is convicted of the offense giving rise to the forfeiture, the court shall order the forfeiture of the property as part of the sentence in the criminal case.” In turn, 18 U.S.C. § 1956(c)(7) – which was cross-referenced in § 981(a)(1)(C) – incorporates as SUAs all predicate offenses under the Racketeer Influenced and Corrupt Organizations (“RICO”) statute – that is, “any act or activity constituting an offense listed in section 1961(1) of this title [Title 18] except an act which is indictable under subchapter II of chapter 53 of title 31.”

Finally, 18 U.S.C. § 1961(1) sets forth the RICO predicates and expressly includes, among those predicates, 18 U.S.C. § 1512. 3 Thus, “[b]y application of § 2461(c), forfeiture of property is mandated for a violation of 18 U.S.C. § 1512, since it is a racketeering activity identified in 18 U.S.C. § 1961(1), which is a specified unlawful activity under 18 U.S.C. § 1956(c)(7)(A).” United States v. Clark, 165 F. Supp. 3d 1215, 1218 (S.D. Fla. 2016) (emphasis added).

The forfeiture law, 18 USC §981, allows for forfeiture when a person profits off any of a bunch of crimes. Terrorism is in there, for example, but Sullivan is not charged with a crime of terrorism (they might get there with Sullivan if he were charged with breaking a window that surely cost more than $1,000 to fix, but they haven’t charged him for that, even though his own video suggests he did break a window and all those windows are ridiculously expensive). Instead, DOJ is using 18 USC §1956, money laundering, to get to forfeiture. Sullivan is not alleged to have laundered money. But that law includes RICO’s predicates among the unlawful activities for which one might launder money. And obstruction, 18 USC §1512, is a specific unlawful activity that may be part of RICO.

That is, they found a crime that Sullivan allegedly committed — obstruction — nested three layers deep in other statutes.

DOJ admits that obstruction hasn’t led to forfeiture all that often — but they’ve found nine cases, none in DC, where it has.

3 There is a limited number of forfeiture allegations paired with § 1512 as the SUA. Section 1512 prohibits (a) killing or assaulting someone with intent to prevent their participation in an official proceeding, (b) intimidating someone to influence their testimony in such a proceeding, (c) corrupting records or obstructing, impeding, or influencing such a proceeding, and (d) harassing or delaying someone’s participation in such a proceeding – crimes that do not often generate profits. Nonetheless, the government has identified at least nine indictments where a § 1512 count was a basis for the forfeiture allegation. See United States v. Clark, 4:13-cr-10034 (S.D. Fla.); United States v. Eury, 1:20CR38-1 (M.D.N.C.); United States v. Ford and Prinster, 3:14-cr45 (D. Or.); United States v. Shabazz, 2:14-cr-20339 (E.D. Mich.); United States v. Cochran, 4:14- cr-22-01-HLM (N.D. Ga.); United States v. Adkins and Meredith, 1:13cr17-1 (N.D. W. Va.); United States v. Faulkner, 3:09-CR-249-D (N.D. Tex.); United States v. Hollnagel, 10 CR 195 (N.D. Ill.); United States v. Bonaventura, 4:02-cr-40026 (D. Mass.). Congress likewise included some of § 1512’s surrounding obstruction-related statutes as SUAs, and forfeiture allegations have also referenced these sister statutes. E.g., United States v. Fisch, 2013 WL 5774876 (S.D. Tex. 2013) (§ 1503 as SUA); United States v. Lustyik, 2015 WL 1401674 (D. Utah 2015) (same).

Of course, those obstruction charges were probably garden variety obstruction (say, threatening trial witnesses for pay), not the already novel application of obstruction that other defendants are challenging.

bmaz may swoop in here and accuse DOJ of using RICO for magical thinking. At the very least, this all seems very precarious, as a matter of law.

I’m all in favor of preventing someone from profiting off insurrection. But this seems like a novel application of law on top of a novel application of law.

Sullivan has a hearing today before Judge Emmet Sullivan, so we may get a sense of whether the judge thinks this invocation of RICO is just magical thinking.

25 replies
  1. GKJames says:

    It’s a curious decision by DOJ. Why bother with what the courts likely will see as a distraction — is this case really going to lead to new frontiers in the application of RICO? — and not simply prosecute the guy on the charges brought? Once (if) convicted, DOJ can ask for the imposition of a significant fine and assignment to US of future profits from video sales.

    • bmaz says:

      No. It may not be just a distraction, but nobody in the world should seek expansion of RICO. It is a garbage theory of law that never should have existed in the first place, and certainly should not be reimagined into a bigger purpose. This is so maddening.

    • emptywheel says:

      A lot of what is going on in the Jan 6 prosecutions are work-arounds on a massive scale. It is, of course, obvious that Sullivan ought not to be able to profit off of starting an insurrection. If they charge him for breaking the window, and with it go for a terrorism enhancement, it will be completely understandable. But here they’re trying to make up for the fact that this is not all built into insurrections.

      • Desider says:

        In light of Trump’s historical success in avoiding legal problems while others take the fall, could this be a toe in the water for treating Jan 6 & other Trump outrages as part of a “criminal enterprise”, especially if they can show Insurgence USA received instruction from his brother’s Patriots and/or Rudy, Stone, Trump & the other orgs involved? It doesn’t look like a huge jump in that direction, but if they’re having trouble finding good enough witnesses to flip on higher ups, perhaps they’ll pull on other threads? [standing by for Bmaz, “bailiff, whack his pee-pee”]
        “By combining individual crimes into a broader context, law enforcement has been able to pursue those in charge of an organization rather than those who report to them, who are not the ones ordering that the crimes be committed.”

          • Rugger9 says:

            I’m curious as a high-level question about why it seems the DOJ is repeatedly selecting obscure laws and interpretations for court filings (where as you’ve noted in many posts before) a more clearly litigated alternative would apply.

            Does DOJ improve the chances of conviction or merely muddy the waters when they dig deep like this?

            • timbo says:

              Well… it could be because actual enforcement of insurrection related laws are so seldomly called upon in the US? As such, it is not necessarily a well-defined area of modern prosecutorial law experience. If there are holes in the codes when it comes to the modern concepts of “re-victimizing society by profitting from a first hand criminal’s autobiographical narrative in the modern media”, it shouldn’t be all that surprising.

              Notions of law and moral constructs change, as do laws as they age. Some laws originally perceived to be good, but of minor consequence at the time of their codification, are now perceived to be great, having become fleshed out and expanded to general universal applause, while still other laws become more and more antiquated until their utility becomes mostly moot, and eventually would fade completely from the memories of society and legal professionals, etc, but for the fact that the long-in-the-tooth arcana keep being reprinted in the code year after decade after century… No, no one wants to waste their time much on determining whether or not a particularly obscure law really matters or not any longer, as there are better fish to fry all the time. And into that mix—this odd brew of old and new, good and bad, well-known and the well-studied vs arcane musty, forgotten law, falls the hero, the prosecutor, who must make an old law fit new circumstances…as falls the judge, the baseball umpire on the case, who must decide if an instance of application is appropriate, who may try to fairly balancing competing prerogatives, who might attempt to adhere to the letter of the rules themselves, yes, adhere to the current understanding of legal application that should be applied in adjudicating the matter, and to point out where there is no rule that the hero can use to get from point A to point B, C, nor, especially, D…

              “…oh, but you are talking about E are we? The case of Thomas Paine in some sordid instance in Virginia, was it? Sigh. Possibly. Well, let me get back to you in two weeks on that then…yes, yes, of course you can always appeal my ruling later… although, frankly, you really should not get ahead of things like this as I fail to see what is so urgent that you require some sort of ruling instanter…What? “A matter of life and death”, is it? Mine or yours? Oh, just a figure of speech? Ah, well, then perhaps in two weeks… what, you are going on vacation in two weeks? Ohhh—so it’s >that< important, eh? Well, make it four weeks then, how's that? Be prepared on the 27th, the day after you come back from your 'life or death' vacation. Now, um, did the "person of interest's" attorney here have anything to add before I adjourn this… A fishing expedition? Yes, I believe that's what our hero over here is planning to do in about two week… oh, I see, yes, that might be considered funny in some circles… but, no, no, I think that this is far from a fishing expedition given the circumstan… Excuse me! Are you being paid by the hour for this sort of… What? You're doing this for free…?! Well…how interesting. Well, I'd advise that you might want to also take some time off then as well from this case… just so you don't go broke mind you… So, see you as well on the 27th… What? You're making money that day you say? Sigh. Yes, yes, obviously you have to make a living too… Okay, how about the 4th then? Quite. (Perhaps I'll have recovered from the past 15 minutes here by then…) This matter is now adjourned until the 4th of next month…see you all back here in July! Hey now! Order! Order!! What? Don't all yammer at once! What's that now? Stop talking all at once! Something about fireworks… the 4th and fireworks…yes, of course I can reconsider the date! Are you implying something about my patriotism now? Let me give you a bit of advice…"

      • Ginevra diBenci says:

        “It is, of course, obvious that Sullivan ought not to be able to profit off of starting an insurrection.”

        Had to read that three times to realize it wasn’t referring to JUDGE Sullivan. Who also ought not to be able to profit off of starting an insurrection, should he find himself feeling the urge.

  2. Hika says:

    Is there a distinction with regard to the 1st Amendment between a person using some illegality to create a video then giving that video to broadcasters to further their political objectives versus a person using some illegality to create a video then seeking to profit from its sale to broadcasters? Is there a difference in the position of the person who created the video? Is there a difference in the position of broadcasters who simply receive a video that was illegally created versus broadcasters who pay for an illegally created video? Does the broadcaster’s knowledge of the illegality involved change their position?

    • Peterr says:

      Careful, bmaz. You bring in the Man of Many Hats, and Marcy may reply with a Brady video . . .

      • P J Evans says:

        He had to drive down to Orange County this morning. Might have gotten there by 9am…. (I’ve done that drive. It’s – not fun. There are some places where you can expect backups, even at 6:30 am.)

    • BobCon says:

      Taking a step back, do you have a sense of how far things are proceeding toward broad conspiracy charges, and whether anyone beyond the participants are likely to be charged?

      I realize the answer may be too soon to tell — it’s a big case, there are 1A issues, lots of weirdos and possibly a muddled trail of hard evidence due to encrypted apps, crypto currency, etc.

  3. Troutwaxer says:

    Let’s see… we’ve got RICO and asset seizure. How about we go for a treason charge and we can win big on the bullshit-law trifecta!

  4. Eureka says:

    Not on the RICO, but on when will the Jan 6th defendants’ predilections recur back to some of their sources.

    Atop EW’s twitter:

    Seamus Hughes: “Scoop: You may recall Robert Packer, a man wearing a ‘Camp Auschwitz’ hoodie on Jan 6th at the Capitol. It took a few calls & some USGovt court filings but I got the search warrant Here’s a rundown of Hitler, antisemitic, and white supremacy items the FBI took out of his house [screenshot]”
    5:54 PM · May 26, 2021

    Included in Mr. Packer’s seized stuff: a copy of this book [ https://en.wikipedia.org/wiki/Race,_Evolution,_and_Behavior ] by noted “scientific racist” (sic) J. Philippe Rushton. Before the Canadian academic’s death, he concern-trolled with the best of them — it’s just the truth of how things are; he suggests no policy or action based on his theories and “findings”; yada yada. [Disclosure, I, like many, have or had copies of this book because someones funded for Rushton a mass-mailing to professional societies’ members; see wiki (or SPLC) on the Pioneer Fund (and its delightful cast of characters and programmes) which Rushton later headed.] Of course propaganda has consequences and here we are with some very real “action.”

    I’ll wait for the enterprising wiki enthusiasts to update relevant pages (a la a new “Relationship to Capitol Insurrection” section, ~ “book was found amidst belongings seized from Capitol defendant… including…”). The wiki linked above seems to be asking for “both sides”; let the facts show what those “sides” entail. Contextualize (the “bothsides”) away!

  5. scribe says:

    House of cards. Designed to help the government scare other defendants into taking a plea. “We’ll [sorta-but-not-really] charge you as racketeers and take all your money and toys and your house and car and all that and make you prove your innocence.”

    Which, coming from the DoJ is no surprise.

    OTOH, this is a DoJ under the control of appointees from a party which has been pretty harsh (at least in some circles) about limiting asset forfeiture and eliminating it in many areas. You know, like first requiring a criminal conviction [under a statute that actually provides for asset forfeiture, not one dragged in 3 levels down].

    If I got a brief where some subordinate played this kind of “but wait, there’s more!” stringing together stuff like DoJ has, I’d kick it back and tell the subordinate to waste their time and client’s money elsewhere, to put together something that wasn’t a house of cards.

    If I got a brief like that from an adversary I’d have a field day teeing off on his desperation.

    Of course, since it comes from DoJ, the court will fall all over itself to indulge them.

    Says this lawyer who actually used civil RICO back in the early 90s to win a case. It’s a pain in the ass, even when you catch crooked bankers stealing money/property for their own benefit.

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