01-1291, 01-1292 U.S. v. Scialabba

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“Treating the word as a synonym for receipts could produce odd outcomes. Consider a slot machine in a properly licensed casino. Gamblers insert coins, and the machine itself returns some of them as winnings. Later the casino opens the machine and removes the remaining coins. What are the ‘proceeds’ of this one-armed bandit: what’s left in the cash box, or the total that entered through the coin slot? At oral argument the prosecutor sensibly replied that the ‘proceeds’ do not exceed what’s left after gamblers have received their jackpots; yet the only difference between the slot machine and the video poker machine is that the slot machine is automated and pays gamblers directly. Likewise, one would suppose, the ‘proceeds’ of drug dealing are the profits of that activity (the sums available for investment outside drug markets), the net yield rather than the gross receipts that must be used to buy inventory and pay the wages of couriers. It would have been easy enough to write ‘receipts’ in lieu of ‘proceeds’ in sec.1956(a)(1); the Rule of Lenity counsels against transmuting the latter into the former and catching people by surprise in the process.”

Vacated and remanded.

Appeals from the United States District Court for the Northern District of Illinois, Castillo, J., Easterbrook, J.