Judge Acquits Journalist Michael Lacey on 50 of 84 Counts in Backpage Case (w/Update)

Michael Lacey, former executive editor of Village Voice Media
On Tuesday, a federal judge acquitted journalist and former Backpage owner Michael Lacey on 50 of the 84 counts on which his 2024 jury returned no verdict. 34 counts remain.

The following opinion/analysis reflects the views of the author and no one else.

UPDATE April 27, 2024: On April 26, the court issued a correction to its previous orders of acquittal. This changed the number of acquittals for Lacey to 50, with 34 counts remaining. This report has been changed to reflect that correction.

On April 23, federal Judge Diane Humetewa in Phoenix issued a mixed ruling on defense motions to acquit journalist Michael Lacey and two co-defendants of all charges levied against them in the Backpage trial.

Known as Rule 29 motions, the pleadings argued that the government failed to present enough evidence to sustain convictions. Regarding Lacey, Humetewa granted the motion on 50 counts and denied it on 34 counts, for which Lacey could be retried. In January, the government signaled its intention to retry Lacey, with a very tentative trial date set for August.

Lacey’s co-defendants Jed Brunst and Scott Spear, former executives of Backpage’s parent company, scored some acquittals as well: Brunst, 15; Spear, 10. Unfortunately, in November, they were found guilty on scores of other charges related to violations of the U.S. Travel Act and money laundering. Both men are in their 70s and potentially could spend the rest of their lives in prison.

That fate could befall Lacey as well.  A former co-owner of Backpage, Lacey was found guilty on one count of international concealment money laundering for moving funds to a bank in Hungary.

Lacey had little choice. Banks in the U.S. kept closing his accounts due to government pressure and adverse publicity. As his local attorney testified at trial, the transfer was done legally, with the government informed of the transaction and all taxes paid.

Currently, Lacey’s sentencing date is June 17, when Brunst is also scheduled to be sentenced. Spear’s sentencing is set for July 9. On the one guilty count, Lacey, who turns 76 in July, could receive a maximum sentence of 20 years in prison.

Essentially, the feds want Lacey, a longtime free speech advocate, to die in prison. They’ve already caused the death of Jim Larkin, Lacey’s longtime business partner, fellow newspaperman and co-defendant in the Backpage case. Larkin, who also faced a slew of charges due to his co-ownership of Backpage, committed suicide on July 31, 2023.

Immediately after sentencing, all three men are expected to appeal to the Ninth Circuit Court of Appeals. Both the prosecution and the judge have stated publicly that there are weighty issues for the appellate court to decide.

Larkin
Newspaperman Jim Larkin, driven to suicide by a ruthless prosecution (via Wikipedia)

Earlier this year, the government seemed gung-ho for another trial, which would be the third. A 2021 trial ended in a mistrial after just three days of testimony due to egregious prosecutorial misconduct.

But recently, the government signaled some hesitancy. In a March response to a defense motion to delay Lacey’s sentencing until after his third trial, prosecutors seemed to blink.

The government’s response reads:

“Defendants will then be permitted to raise whatever issues they deem appropriate to the Ninth Circuit. After the Ninth Circuit issues its mandate, then the United States will determine whether it will proceed to re-try Defendant Lacey or, alternatively, dismiss the remaining charges.”

Will Lacey and the others be able to stay out pending their appeals?

Attorneys who do work in federal criminal court tell me that, given their ages, their records of abiding by the terms of their release, the non-violent nature of the crimes, and the potential for reversal on appeal,  they ideally should. But the decision is ultimately the court’s to make.

What’s Past Is Prologue

We are now in the seventh year of this eternal prosecution. Lacey and Larkin were arrested on April 6, 2018, their homes raided, their money seized and Backpage, a Craigslist-like classified listings site that operated legally, was shuttered and destroyed.

Though Lacey and Larkin sold Backpage in 2015 to its creator and CEO, Carl Ferrer, the government was ticked off by their defiance. Backpage resisted calls from state Attorneys General, other politicians, and activist groups to shut down its escort advertising section, as Craigslist did in 2010.

Several federal and state court rulings held that Backpage was protected by the First Amendment and Section 230 of the Communications Decency Act, which generally immunizes online publishers from liability for content posted by their users. (Or at least it did before FOSTA/SESTA.)

Significantly, Section 230 does not immunize against federal criminal law.

In 2012 and 2013, attorneys at the U.S. Justice Department were secretly arguing that the government should not bring a criminal case against Backpage. In 2017, the DOJ reversed course, fired up by a Senate investigation prompted by Lacey and Larkin’s longtime enemies, John and Cindy McCain.

A grand jury was empaneled and in 2018 Lacey, Larkin and four others were indicted on up to 100 counts including conspiracy, money laundering, and violations of the U.S. Travel Act, which makes it a crime to intentionally use a vehicle of interstate commerce to violate certain state laws, such as laws against prostitution.

Will the First Amendment Prevail?

In its indictment, the government argued that the First Amendment did not shield Backpage because all of the adult-themed ads that ran on Backpage were illegal offers of prostitution. The feds wedded the Travel Act charges to 50 ads from Backpage, some of which featured suggestive language and photos of scantily-clad women.

There was little discussion of the First Amendment during the trial. The defendants’ attorneys were not allowed to mention the federal cases that ruled the First Amendment protected Backpage’s publication of suggestive adult ads. Nor were they permitted to point out that a slew of lawyers had repeatedly counseled them that Backpage was protected by Section 230 and the First Amendment.

Humetewa’s 71-page ruling is complex, and I’ll have more to say about it later. But for now, I think a key phrase, one repeated several times in the text, is significant. Humetewa writes that, under the applicable standard of review, she must review the evidence and the testimony at trial “in the light most favorable to the Government.”

Though Humetewa disagrees with the government in several places, she still buys the government’s essential theory of the case: i.e., that the First Amendment does not apply because, regardless of what the ads at issue said, the ads actually were illegal offers of sex for money. According to the government, the defendants knew this and were engaged in a criminal conspiracy to promote prostitution.

One way the government says the defendants conspired was by moderating the site. In other words, by having a list of banned terms and removing explicit photographs, Backpage supposedly sanitized the ads, making them look legal when in fact they weren’t.

The government’s theory could apply to mainstream social media companies, potentially opening their owners up to prosecution under numerous federal laws.

Almost all social media sites in the U.S. know people misuse their sites for criminal ends. They also have lists of banned terms and moderate their sites heavily to remove unwanted content. If the Backpage convictions hold, moderation could become evidence of criminality.

Indeed, despite court rulings in their favor, Lacey and Larkin may have been better off if they had not moderated Backpage at all.

Backpage’s owners had been warned by politicans and non-governmental organizations that adult ads on the site were thinly-veiled offers of prostitution. This criticism prompted Backpage to increase its moderation efforts, which the government later claimed was evidence of an intent to facilitate criminal conduct.

Citing the testimony of Ferrer, who took a plea deal from prosecutors and is unlikely to receive any prison time, Humetewa writes:

During the trial, the Court permitted the Government to introduce testimony of the Defendants’ knowledge that Backpage was being used to promote prostitution. For example, Mr. Ferrer was allowed to testify that several NGOs repeatedly informed Defendants that their website was selling girls and women for money and that Backpage was receiving thousands of subpoenas relating to prostitution and trafficking on Backpage. Mr. Ferrer’s brief statement that Backpage and its owners were “pressured” was another example of testimony that suggested Defendants knew their website was facilitating the promotion of prostitution. 

So Backpage would’ve been better off not responding to subpoenas quickly or cooperating with law enforcement.

Also, the judge noted that Lacey and Larkin failed to heed the admonishments of politicians:

“There was also evidence that each of these Defendants were on notice by law enforcement, State Attorneys General, non-profits, and the media that a portion of Backpage’s escort ads were in fact leading to prostitution offenses,” Humetewa writes.

I mean no criticism of the judge. Humetewa is ruling based on her interpretation of the law, and, certainly, she knows more about the law than someone without her experience or a law degree.

But one irony of the government’s theory of the case is that it would hold website owners and operators to a higher standard than law enforcement. During the trial, police officers testified that they could not make an arrest for prostitution based on an escort ad alone. The language was too ambiguous. The photos? They might not even be the women depicted therein.

Take this passage from Humetewa’s ruling:

Brian Griffin, a Sergeant with the Northborough Police Department (“Sgt. Griffin”), testified that in September 2013 he was alerted to suspicious circumstances of two females loitering around a hotel room. (Trial Tr., Doc. 1923 at 62–70). Believing that they may be involved in prostitution, Sgt. Griffin went to Backpage.com and found an ad depicting one of the females. (Trial Tr., Doc. 1923 at 64–65; Trial Exs. 212, 212a). This ad is the subject of Count 2. Sgt. Griffin called the ad number and made an appointment to see “Destinee,” to pay her for oral sex. (Trial Tr., Doc. 1923 at 66). Upon entering the hotel room, Sgt. Griffin observed a male “John” in the bathroom and learned that he paid for the hotel room in exchange for sex. (Id. at 70). Based on this testimony, there is sufficient evidence from which a reasonable juror could find that the ad in Count 2 was a sex for money ad on Backpage posted in violation of Massachusetts law. 

What’s problematic about this, from a non-lawyer’s perspective, is that the police officer admitted under oath that he did not have probable cause for an arrest based on the ad alone. Rather, the officer had to investigate further, based on a suspicion of prostitution. He ultimately did a bust based on his offer of sex for money and the woman’s acceptance of that offer.

Given the officer’s testimony, the jury’s conclusion that the poster of the innocuous ad intended to engage in sex for money may have been reasonable, but the moderator who approved that ad did not know what the police officer ultimately knew. The moderator could only look at the ad itself.

If publishers of third-party speech can lose their First Amendment protections based on the subsequent conduct of the persons posting that speech, social media in its current form is likely to end.

Internet companies would have no way to protect themselves from the actions of their users except by refusing to publish speech that has any risk of being associated with unlawful activity. That would include vast swaths of what historically has been considered to be First Amendment protected speech.

Of course, speech online becomes less free every day. And the Backpage convictions are only one sad part of that picture.

Please also see:
Judge Sets Sentencing Dates for Backpage Defendants (w/Update)
and
Judge Sets Date for Third Trial of Journalist Michael Lacey

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About Stephen Lemons

Stephen Lemons is an award-winning investigative journalist with more than 20 years of experience covering everything from government corruption to white-supremacist gangs. In addition to Front Page Confidential, his work has appeared in Phoenix New Times, the Los Angeles Times, Salon.com, and the Southern Poverty Law Center’s Intelligence Report magazine.

One comment

  1. Inch by Inch it’s a Cinch! Yard by Yard makes it hard. Everyone has been punished enough. This is so small related to the corruption in today’s politics and social media where so many people are harmed. Enough is Enough. Today few remember Backpage. We have wars, hostages, revolutions in our major universities, corruption in politics supported by social media. Let them go and deploy our DOJ and Federal Judges to work with n the dangers we face in the world today. Please

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