United States v. Box

530 F.2d 1258 (1976)

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United States v. Box

United States Court of Appeals for the Fifth Circuit
530 F.2d 1258 (1976)

  • Written by Brett Stavin, JD

Facts

Henry Floyd “Red” Box (defendant) was charged by the federal government with violating 18 U.S.C. § 1955, the federal antigambling statute. The indictment followed a federal investigation of sports-betting operators, known as bookmakers, in Louisiana during the 1973 football season. As discovered by federal law enforcement, Box did not solicit bets or have customers, but he was a heavy bettor who occasionally accepted lay-off bets from bookmakers in the area. These were bets that the bookmakers made to hedge their own risk. The bookmakers sought to have equal betting on both teams in every game, because their profit came from the percentage that losing bettors were required to pay for the privilege of betting. If the betting became unbalanced, the bookmakers sometimes made bets of their own—lay-off bets—to effectively lessen their risk. The evidence at trial showed that Box occasionally accepted these lay-off bets from bookmakers Cook and Stewart, and although the bets could be substantial, they did not occur with regularity. Moreover, because the bets were intended to allow the bookmakers to hedge risk, Box sometimes received favorable odds. However, there was no evidence that the bookmakers could depend on Box to always accept such bets. There was also no evidence that Box provided gambling-related information to bookmakers. Box was convicted by a jury. On appeal, Box argued that his acceptance of lay-off bets did not support a finding that he was a bookmaker and, therefore, liable under § 1955.

Rule of Law

Issue

Holding and Reasoning (Goldberg, J.)

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