The Extraterritorial Reach of Criminal Statutes
January 31, 2024
When federal statutes do not indicate how far they reach, courts apply a presumption against extraterritoriality to limit their geographic scope. Last year, in Abitron Austria GmbH v. Hetronic International, Inc. (2023), the Supreme Court revised the presumption by requiring conduct in the United States for a statute’s application to be considered domestic. Meanwhile, lower courts were considering the geographic scope of federal criminal statutes in cases involving no U.S. conduct.
In United States v. Rolle (2023), the Eleventh Circuit held that a federal statute criminalizing the smuggling of immigrants applies to conduct outside the United States. In United States v. Alahmedalabdaloklah (2023), the Ninth Circuit held that a federal statute criminalizing conspiracies to blow up property owned by the United States applies to conduct outside the United States. Both decisions relied on Chief Justice Taft’s decision in United States v. Bowman (1922), attempting to reconcile Bowman with the Supreme Court’s current extraterritoriality framework in different ways.
Bowman held that the presumption against extraterritoriality did not apply to crimes against the U.S. government. Arguably, immigrant smuggling and destroying U.S. property both fall in that category. The question is whether Bowman survives the Supreme Court’s more recent decisions applying the presumption.
The Supreme Court’s Current Extraterritoriality Framework
As I have recounted here (and at greater length here), the Supreme Court’s approach to determining the geographic scope of federal statutes has changed many times. The Court’s current approach was developed in Morrison v. National Australia Bank (2010) and articulated as a two-step framework in RJR Nabisco, Inc. v. European Community (2016). At step one of this framework, the Court looks for a clear indication of a statute’s geographic scope and, if it finds one, applies the statute as Congress has indicated. If there is no clear indication, then at step two, the Court decides whether applying the statute would be domestic (and permissible) by looking to the “focus” of the provision.
The key question in Abitron was whether, at step two, it is sufficient that the focus of the provision occurs in the United States or, alternatively, whether conduct relevant to the focus must also occur in the United States. Abitron was a trademark infringement case under the Lanham Act. The defendants had put U.S. trademarks on foreign-made products without authorization, some of which were then imported into the United States. By a vote of 5-4, the Court held that it was not enough that the foreign-made products would cause confusion in the United States (arguably the focus of the relevant statutory provisions). There also had to be conduct in the United States for the Lanham Act to apply. The presumption against extraterritoriality, Abitron states, is a “presumption against application to conduct in the territory of another sovereign” (emphasis added).
Some federal criminal statutes contain express provisions reaching conduct outside the United States. Section 2332 of Title 18 makes it a federal crime to kill a U.S. national “while such national is outside the United States.” Section 1956(f) extends the offense of money laundering to conduct abroad if the offender is a U.S. citizen. Under the Supreme Court’s two-step framework, these statutes provide clear indications of extraterritoriality.
Other statutes say nothing about scope. The federal wire fraud statute is one, and lower courts have interpreted it to require conduct in the United States, although they are divided over how much conduct is needed. Federal securities fraud statutes, like Section 10(b) of the Securities Exchange Act, are similarly silent about how far they reach. In Morrison, the Supreme Court held in a civil case that Section 10(b) applies only to transactions in the United States, and lower courts have imposed the same limit on criminal prosecutions under that Section.
What About Bowman?
But what if the victim of the crime is the U.S. government itself? Do the same rules apply? In United States v. Bowman (1922), the Supreme Court held that an earlier version of the presumption against extraterritoriality “should not be applied to criminal statutes which are, as a class, not logically dependent on their locality for the government’s jurisdiction, but are enacted because of the right of the government to defend itself against obstruction, or fraud wherever perpetrated.” The statute in question made it a crime to defraud a corporation owned by the United States. The Court concluded that the extraterritorial scope of this provision could be “inferred from the nature of the offense.”
As I have previously explained, Bowman did not purport to create an exception to the presumption against extraterritoriality for all criminal statutes. With respect to “[c]rimes against private individuals or their property,” the Court reasoned, the presumption applied with full force. “If punishment of them is to be extended to include those committed outside of the strict territorial jurisdiction, it is natural for Congress to say so in the statute, and failure to do so will negative the purpose of Congress in this regard.” It was only crimes against the U.S. government that Bowman exempted from this general rule.
Rolle and Alahmedalabdaloklah
The federal statute criminalizing immigrant smuggling is arguably such a statute. The defendant in Rolle was arrested by the U.S. Coast Guard off the coast of the Bahamas carrying 16 non-U.S. citizens headed for the United States. The statute contains no clear indication of geographic scope, but the Eleventh Circuit held that it could be applied extraterritorially based on Bowman. “There are two approaches to analyzing extraterritoriality in the Supreme Court’s precedents,” the court reasoned. “[O]ne is set forth in United States v. Bowman, and the other is found in the more recent Morrison v. National Australia Bank Ltd. and its progeny.” The Supreme Court has not expressly overruled Bowman, the court continued, “and it is not our prerogative to overrule the Supreme Court.” “[L]imiting § 1324(a) to the territorial United States would significantly curtail the effectiveness of the statute because it would prevent the government from prosecuting those who engage in the targeted conduct but simply fail to cross our border.” Therefore, under Bowman, the provision could be applied extraterritorially based on “the nature of the offenses.”
Another federal statute makes it a crime to damage or destroy, by fire or explosives, any property owned or possessed by the United States but says nothing about the location of the property. The defendant in Alahmedalabdaloklah was convicted of conspiring to destroy U.S. property in Iraq by designing switches for improvised explosive devices (IEDs). Although the prosecution argued that the Supreme Court’s two-step framework did not apply at all to criminal statutes, the Ninth Circuit rejected that argument, noting Morrison’s statement that the presumption against extraterritorially applies “in all cases.” Instead of treating Bowman as an alternative approach, the Ninth Circuit tried to incorporate Bowman within the two-step framework. Citing RJR Nabisco, the court observed that a clear indication of extraterritoriality at step one “may be demonstrated by context.” Bowman, the court reasoned, could be considered “[p]art of the context.” Because the offense with which Alahmedalabdaloklah was charged directly harmed the U.S. government and foreseeable overseas applications existed at the time the statute was passed, the court held that it could be applied extraterritorially to the defendant’s conduct in Iraq.
Although I am sympathetic to the results that both courts were trying to reach, the reasoning in Rolle and Alahmedalabdaloklah is highly problematic. The Ninth Circuit’s decision in Alahmedalabdaloklah treats “context” as an excuse to ignore step one’s requirement of a clear indication altogether. In RJR Nabisco, the Supreme Court found a clear indication of geographic scope in the fact that the RICO statute referred to predicate offenses that expressly applied extraterritorially. There is nothing similar in the federal statute criminalizing the destruction of U.S. property. In Abitron, the Court emphasized that “[i]t is a ‘rare statute that clearly evidences extraterritorial effect despite lacking an express statement of extraterritoriality’” (quoting RJR Nabisco). Federal statutes criminalizing offenses that directly harm the U.S. government and could foreseeably occur abroad are hardly rare. The Eleventh Circuit’s approach in Rolle avoids these problems but—as the Ninth Circuit noted—runs directly into the Supreme Court’s statement in Morrison that the presumption applies “in all cases.”
Writing before Abitron, I suggested an alternative way of reconciling Bowman with the current two-step framework. Bowman’s suggestion that geographic scope can be “inferred from the nature of the offense” fits naturally within step two of the framework, the “focus” step. When, as in Bowman, statutes are “not logically dependent on their locality for the government’s jurisdiction, but are enacted because of the right of the government to defend itself,” a court may conclude that the focus is non-geographic and applies globally. Unfortunately, Abitron’s interpretation of the two-step framework as requiring conduct within the United States makes this solution problematic as well.
Conclusion
What to do about federal criminal statutes is just one of the problems created by the Supreme Courts return to a conduct-based presumption against extraterritoriality, but it is a serious one. The Court could stick to its guns and require Congress to amend every federal criminal statute and expressly address its geographic scope. That is what Congress did with statutes criminalizing the assault, kidnapping, and murder of U.S. government officials after the D.C. Circuit faithfully applied the two-step framework to hold that such statutes did not apply abroad.
But I find it difficult to imagine the Supreme Court letting immigrant smugglers who fail to enter the United States and terrorists who conspire to destroy U.S. property abroad walk free because Congress has not amended its statutes to comply with the latest developments in statutory interpretation. This is a problem of the Supreme Court’s own making. And, someday, the Court will have to fix it.