First Circuit Adds to Split On Whether Use of the Internet Is ‘Interstate Commerce’

Interstate Commerce

Section 1343 makes it a federal crime to devise “any scheme or artifice to defraud” when a communication “for the purpose of executing such scheme” is “transmitted by means of wire, radio, or television communication in interstate or foreign commerce.” (Emphasis added.)
According to a House of Representatives report, legislators expected the law to address “relatively isolated” instances of fraud by means of radio and television, H.R. Rep. No. 388, at 1-2 (1951)), but reliance on the law has expanded over time to include frauds via “wireless communications” of various kinds such as emails, cellphone calls and text messages.
Other federal statutes use a different phrase — “affecting” rather than “in” interstate or foreign commerce — to express the jurisdictional requirement of federal law. The phrase “affecting interstate commerce” has been understood to be broader in reach than “in interstate commerce.” See, Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 115-16 (2001) (noting that “in interstate or foreign commerce” language limits Congress’s reach).
Courts have construed “in interstate or foreign commerce” to require a wire communication to cross state lines, regardless of where the communicators were located. See, e.g., Smith v. Ayres, 845 F.2d 1360, 1366 (5th Cir. 1988) (“As several courts have recognized, [§1343] requires that the wire communication cross state lines.”)

Circuit Split

The “transmitted … in interstate or foreign commerce” requirement appears in multiple criminal statutes, including 18 U.S.C. §2251 and 18 U.S.C. §2252, which criminalizes the production and receipt of child pornography, and 18 U.S.C. §2314, which criminalizes the transmission of stolen goods (and other items).
In the context of sufficiency challenges, courts have interpreted the “in interstate or foreign commerce” language in the same manner, regardless of the particular criminal statute at issue. However, courts have disagreed as to what evidence the government must introduce when jurisdiction is premised on use of the internet.
In the First, Third and Fifth Circuits, courts have held that evidence of transmission or receipt over the Internet is sufficient to satisfy the interstate commerce requirement of §§2251(a), 2252(a)(2) and 2252A(a)(2). United States v. Carroll, 105 F.3d 740 (1st Cir. 1997); United States v. MacEwan, 445 F.3d 237 (3d Cir. 2006); United States v. Runyan, 290 F.3d 223 (5th Cir. 2002).
In MacEwan, a witness testified how the internet is designed and operates across state lines, 445 F.3d at 241; and, in Carroll, the court went further and held that victim testimony to the effect that the defendant intended or knew that images would be distributed via the Internet was sufficient to establish the interstate commerce element. 105 F.3d at 742; but see, Runyan, 290 F.3d at 243 (finding victim testimony concerning defendant’s intent to use the Internet insufficient to establish interstate commerce element of §2252A).
Courts in these circuits have made clear that a transmission must cross a state or national border, but that internet usage by itself is sufficient proof of interstate commerce because, in substance, internet-based communications use servers, often out-of-state, to receive and transmit messages.
The Ninth Circuit has taken a different approach. In United States v. Wright, 625 F.3d 583 (9th Cir. 2010), superseded by statute on other grounds, in which child pornography images were transmitted over the internet, the parties agreed that the images had not crossed state lines. The court held that, under the circumstances, a defendant’s connection to the internet in itself could not satisfy the jurisdictional requirement of §2252A.
The Ninth Circuit distinguished the First and Third Circuits’ position as limited to situations where “it is impossible to determine” whether child pornography images had crossed state lines.
As to wire fraud, the First Circuit, in dicta, indicated that it would treat mail fraud in the same fashion as transmission of child pornography. United States v. Lewis, 554 F.3d 208, 213-14 (1st Cir. 2009). The Tenth Circuit directly addressed communications over the internet in the context of Section 1343. United States v. Kieffer, 681 F.3d 1143, 1153-57 (10th Cir. 2012).
In Kieffer, the defendant was charged with wire fraud for using a website to promote the unauthorized practice of law. The court held that while the internet “standing alone” does not establish that a web transmission traveled across state lines, the government had presented evidence to satisfy the required interstate nexus.
Jury could reasonably infer defendant caused website content to be transmitted across state lines since website registered with company operating servers in Virginia, and alleged victims accessed website in Tennessee and Colorado
Until the First Circuit’s recent decision in O’Donovan, the Tenth Circuit was the only federal court of appeals to address the issue in the context of Section 1343.