United States v. Eugene Andrew Anthony Algie ( 1983 )

KRUPANSKY, Circuit Judge,

dissenting.

The majority opinion, having elected to support its conclusion upon the isolated fact that “the only direct factor before the magistrate was the fifteen telephone calls from the Cincinnati apartment to Highland Security Corporation”, to the exclusion of other implicating allegations of the affidavits construed in a “common sense” review of the “totality of the circumstances”, Illinois v. Gates, — U.S. —, —, 103 S.Ct. 2317, 2328, 76 L.Ed.2d 527 (1983), prompts me to respectfully dissent.

The sole issue joined in this appeal is the sufficiency of the factual allegations of two affidavits to support a suspicion that there was a fair probability that gambling paraphernalia would be located on the premises of Highland Security Inc. (Highland) if a search was conducted upon issuance of a warrant. The controlling legal principles are settled. The Fourth Amendment to the United States Constitution demands that no warrant shall issue except upon probable cause:

The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and 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.

“Probable cause” exists where there is a “fair probability that contraband or evidence of a crime will be found in a particular place.” Gates, supra, — U.S. at —, 103 S.Ct. at 2332 (emphasis added). The quantum of “proof” necessary to support probable cause is less than the quantum traditionally required to satisfy the prima facie standard:

As early as Lock v. United States, 7 Cranch. 339, 348, 3 L.Ed. 364 (1813), Chief Justice Marshall observed, in a closely related context, that “the term ‘probable cause,’ according to its usual acceptation, means less than evidence which would justify condemnation ... It imports a seizure made under circumstances which warrant suspicion.” More recently, we said that “the quanta ... of proof” appropriate in ordinary judicial proceedings are inapplicable to the decision to issue a warrant [Brinegar v. United States, 338 U.S. 160, 173, 69 S.Ct. 1302, 1309, 93 L.Ed. 1879 (1949) ]. Finely-tuned standards such as proof beyond a reasonable doubt or by a preponderance of the evidence, useful in formal trials, have no place in the magistrate’s decision. While an effort to fix some general, numerically precise degree of certainty corresponding to “probable cause” may not be helpful, it is clear that “only the probability, and not a prima facie showing, of criminal activity is the standard of probable cause.” [Spinelli v. United States, 393 U.S. 410, 419, 89 S.Ct. 584, 590, 21 L.Ed.2d 637 (1969)].

Gates, supra, — U.S. at —, 103 S.Ct. at 2330.

In determining whether probable cause exists, a magistrate is not bound by rigid legal principles. Rather, the circumstances must be viewed in their totality and with the application of common-sense:

The task of the issuing magistrate is simply to make a practical, common-sense decision whether, given all the circumstances set forth in the affidavit before him, including the “veracity” and “basis of knowledge” of persons supplying hearsay information, there is a fair probability that contraband or evidence of a crime will be found in a particular place.

Gates, supra, — U.S. at —, 103 S.Ct. at 2332. Pertinently, judicial review of a magistrate’s determination is extremely limited. The federal forum may not undertake a de novo review but, rather, must afford “great deference” to the magistrate’s finding:

[W]e have repeatedly said that after-the-fact scrutiny by courts of the sufficiency of an affidavit should not take the form of de novo review. A magistrate’s “determination of probable cause should be paid great deference by reviewing courts.”

Gates, supra, — U.S. at —, 103 S.Ct. at 2331, citing Spinelli v. United States, 393 U.S. 410, 419, 89 S.Ct. 584, 590, 21 L.Ed.2d 637 (1969). This requirement of deference mandates that “doubtful or marginal cases” be construed in accordance with the magistrate’s initial determination. Id.; — U.S. at — n. 10, 103 S.Ct. at 2331 n. 10.

One factor pertinent to the magistrate’s review of the “totality of the circumstances” is the modus operandi of the individual suspected of criminal activity or of the unique criminal conduct allegedly involved. In Gates, for example, petitioners were suspected of transporting controlled substances from Florida to Illinois on a routine basis. Law enforcement officials documented conduct which was “innocent” when casually viewed but which attained significantly heightened relevance when viewed within the context of the modus operandi of the crime.¹ See also: Ker v. California, 374 U.S. 23, 83 S.Ct. 1623, 10 L.Ed.2d 726 (1963).

Confronting the action sub judice, it is initially observed that the allegedly offensive search warrant for Highland was supported by two affidavits, both authored by Harold Harrison, Special Agent of the Federal Bureau of Investigation. The first affidavit (Affidavit I), dated May 11, 1979, documented with particularized detail the existence of a large scale bookmaking enterprise operating from Apartment 41, 2500 Warsaw Avenue, Cincinnati, Ohio. A1 Weyer (Weyer) and Dan Zenni (Zenni) were the ringleaders. Two telephones were utilized: 471-1708 and 471-0595' (Aff. I Par. 3d). Harrison attested, as an expert in gambling, that a successful gambling operation required a “laying off” of bets to achieve balanced books and assured profit.² (Aff. I Par. 4b). He further represented that it was imperative for the successful bookmaker to receive accurate “line information”.³ (Aff. I Par. 4e) Telephones were used to lay off and receive the line.

Harrison attested further that a substantial volume of bookmaking activity was emanating from the Weyer-Zenni Warsaw apartment. Several confidential informants supplied the Cincinnati Police Department with information documenting the placement of bets at that location. (Aff. I Par. 5). The operation was connected to the Pennant Cafe, searched by the FBI in May of 1978, where gambling paraphernalia was seized. (Aff. I Par. 7). Robert Herbst, a small time bookie, accepted bets and called them in to a telephone number listed to Weyer. (Aff. I Par. 9-10). Zenni and Weyer jointly owned the D & A cafe (D & A), in Newport, Kentucky. The D & A was searched on December 13, 1978, and February 8,1979, and on each occasion a quantity of bookmaking paraphernalia was seized. (Aff. I Par. 15 and 16). In May, 1979, bookmaking activity continued at the D & A; bets were being accepted there by Dick Musk.

Based on the probable cause supported by Affidavit I, a pen register was authorized to be placed on two telephones located at the Warsaw apartment utilized as the book headquarters by Weyer and Zenni.⁴ Outgoing calls were monitored for a 12-day period commencing on May 19, 1979 and ending May 30, 1979. Special Agent Harrison submitted a second affidavit (Affidavit II) in support of the existence of probable cause to search several businesses and residences in the immediate geographical area of the Warsaw apartment. Affidavit II incorporated Affidavit I by reference, and further incorporated the pen register information which resulted from the warrant predicated upon Affidavit I. Harrison also attested to detailed and reliable information supplied by law enforcement officers and a myriad of confidential informants:⁵

Affidavit II unequivocally documented that 15 calls had been placed from the Weyer-Zenni operation on Warsaw Avenue to Highland located in northern Kentucky, during the 12-day period in which the pen register had been maintained (Aff. II Par. 3). The Weyer-Zenni’s business hours at the Warsaw apartment were from 10:30 a.m. to 7:30 p.m.; very few calls were placed outside of those hours (Aff. II Par. 4). The Weyer-Zenni operation, which was reportedly booking over $200,000 in bets a week (Aff. I Par. 5) had been in operation for an extended period of time, and was a highly successful enterprise. The operation was laying-off bets to someone, and was utilizing the telephone to do so. Telephone calls originating from a location suspected of harboring criminal activity may appear to be a relatively “innocent” acts. However, when, as here, the modus operandi of the crime relies upon the telephone as an essential tool of the trade, the existence of otherwise “innocent” calls assumes heightened significance and renders the recipient of the calls highly suspect. This is particularly true where, as here, the telephone calls were placed almost exclusively during the critical period of booking operation, i.e., 10:30 a.m. and 7:30 p.m. each day.

Highland’s location in northern Kentucky, well within the geographical boundaries of the Weyer-Zenni operation, also rendered it suspect. The second affidavit documented with particularized detail the existence of numerous businesses and personal residences in this same immediate geographical area which were undeniably implicated and intertwined with the Weyer-Zenni operation. For example, the D & A Cafe was obviously well implicated (Aff. I Par. 6-10); so was Pelle’s Cafe (Aff. II Par. 13-16), Ivy & Bill’s Cafe, Newport, Kentucky (Aff. II Par. 17-21), Pete’s Food & Beverage, Cincinnati (Aff. II Par. 23), and the Edgemont Pony Keg.

It is pertinent to observe that the number of calls placed to Highland were approximately equal to or in excess of the number of calls placed to other business establishments and residences undeniably implicated in criminal activity and located in the immediate geographical area in issue. There is no doubt that probable cause existed to search these other establishments/residences, and yet all received approximately the same or fewer number of telephone calls from the book headquarters than did Highland. The D & A Cafe, owned and operated by the ringleaders Weyer and Zenni, received only 16 calls during the 12 day period (Aff. II Par. 5); see also: Pelle’s Tax Service (4 calls); Eugene Algie (10 calls); Edward Kerkhoff (3 calls); Pelle’s Cafe (2 calls); Edgemont Pony Keg (15 calls), etc. (Id.) The number of calls to Highland were comparable to the number of calls placed to the other well documented illegal establishments, thereby rendering the telephone calls to Highland extremely suspect. Also, since lay-off bets are generally placed only once each day, when the bookmakers have determined with certainty the necessity of balancing their books, the magistrate was justified in concluding that 15 calls within a 12 day period warranted a suspicion that Highland, like the other involved businesses and residences, was a booking operation. The two affidavits, when reviewed within the “totality of the circumstances” in a “common-sense” manner, Gates, supra, — U.S. at —, 103 S.Ct. at 2332, support the magistrate’s determination that there was a fair probability that evidence of contraband would be located at Highland. I would therefore affirm the district court’s Order refusing to suppress the evidence confiscated at Highland.

1 . These otherwise innocent acts included defendant’s flight to Florida from Illinois, an overnight stay at a hotel, followed by a return to Illinois via automobile.

2 . “Laying off” characterizes the practice whereby a bookmaker has more money bet on a horse race or a sporting event than he desires and he transfers or hedges all or part of the bet to another bookmaker. See: United States v. Avarello, 592 F.2d 1339 (5th Cir.), cert. denied, 444 U.S. 844, 100 S.Ct. 87, 62 L.Ed.2d 57 (1979). For example, the typical better or “player” bets $11 to win $10. The bookmaker retains the $11 if the better loses, and pays $21 if the better wins ($11 plus $10). The bookmaking operation would attempt to equalize or “balance” the number of bets on each side and insure a profit of the $1 “vigorish” or “juice”. For example, suppose the bet concerned Team A v. Team B. If two bets were placed on Team A and two bets were placed on Team B, the book operation would take in $44 ($11 on four bets). Either Team A or Team B would win. The book would pay out $42 (the original two $11 bets and two $10 winnings) and receive a $2 profit irrespective of which team won. Axiomatically, the bookmaker’s risk of loss decreases as the number of bets both for and against a particular team are equalized. In an attempt to balance the bets to minimize risk, bookmakers confer with one another and shift or “lay off” bets.

3 . The “line” is the point spread or odds applied to the outcome of an athletic contest or horse race as between the contenders. A bookmaker’s accurate calculation of the “line” permits him to insure a relatively “balanced book” through the normal wagering process.

4 . The existence of probable cause to establish a pen register at the Warsaw Avenue apartment is not challenged in this appeal.

5 . Representations of numerous confidential in-formations were incorporated in both affidavits. The reliability of each was expressly detailed. For example, CI-1 was qualified as follows:

On May 2, 1979, Officer Thomas H. Cornett, Cincinnati, Ohio Police Department, Vice Control Squad, advised me that he has been in sporadic contact during, the past three years with a confidential informant hereinafter referred to as CI-1. CI-1 has provided Officer Cornett with reliable information much of which has been verified through independent investigation, during at least sixty contacts. CI-1 has been and is currently placing bets with Cincinnati, Ohio, bookmakers and is familiar with bookmaldng procedures. Information provided by CI-1 has resulted in one conviction for prostitution.