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ELIZABETH A. STRANGE

First Assistant United States Attorney District of Arizona

KEVIN M. RAPP (Ariz. Bar No. 14249, kevin.rapp@usdoj.gov)

MARGARET PERLMETER (Ariz. Bar No. 024805, margaret.perlmeter@usdoj.gov)

PETER S. KOZINETS (Ariz. Bar No. 019856, peter.kozinets@usdoj.gov) 

ANDREW C. STONE (Ariz. Bar No. 026543, andrew.stone@usdoj.gov)

Assistant U.S. Attorneys

40 N. Central Avenue, Suite 1800

Phoenix, Arizona 85004-4408

Telephone (602) 514-7500

JOHN J. KUCERA (Cal. Bar No. 274184,john.kucera@usdoj.gov)

Special Assistant U.S. Attorney

312 N. Spring Street, Suite 1200

Los Angeles, CA 90012

Telephone (213) 894-3391

JOHN P. CRONAN

Acting Assistant Attorney General

Criminal Division, U.S. Department of Justice

REGINALD E. JONES (Miss. Bar No. 102806, reginald.jones4@usdoj.gov)

Senior Trial Attorney, U.S. Department of Justice

Child Exploitation and Obscenity Section 

950 Pennsylvania Ave N.W., Room 2116

Washington, D.C. 20530

Telephone (202) 616-2807 

Attorneys for Plaintiff

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

United States of America,

Plaintiff, 

v. 

James Larkin,

Defendant.

No. CR-18-0422-02-PHX-SPL (BSB) 

UNITED STATES’ RESPONSE TO 

MOTION TO AMEND THE 

RELEASE CONDITIONS OF 

DEFENDANT LARKIN’S PRETRIAL 

RELEASE

(Docs. 171 and 183)

INTRODUCTION AND SUMMARY OF ARGUMENT

The United States of America, by and through undersigned counsel, submits this 

memorandum in response to defendant James Larkin’s (“Larkin”) motion to amend his 

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conditions of release (Doc. 171). The United States argued at the early stage of these 

proceedings that Larkin constitutes a risk of flight in light of the serious charges against 

him, the weight of the evidence, and his financial status and ties abroad, and that he should 

be released only on conditions or a combination of conditions sufficient to reasonably 

assure his appearances as required by law. For a variety of reasons, Larkin’s recent request 

to remove electronic monitoring is unavailing and the government is not prepared to 

consent to, and indeed, opposes a change in the current conditions of release.

First, Larkin’s release conditions resulted from a stipulated agreement between him 

and the government. He has not articulated any change in circumstances to warrant 

amending his release conditions, other than that he now has new counsel (located in 

southern California, as opposed to northern California). His other reasons in support of his 

motion were previously known at the time of his arrest. 

Second, Larkin misled the court at his arraignment about his involvement with 

Backpage. In addition, he was recently sanctioned by another court for misconduct in 

Backpage-related litigation. As discussed below, this raises concerns about whether he 

would be candid with the Court (including Pretrial Services) when responding to questions 

about travel, finances, etc. 

Third, since his arrest, the weight of the evidence against him has increased – and 

he faces a significant amount of time in prison if convicted. As explained below, Larkin,

in his capacity as a Backpage owner, employed several business strategies to increase 

revenue by expanding the volume of prostitution-related ads. These acts (and other factors) 

rebut his claims of First Amendment immunity. His motion to amend his conditions should 

be denied.

RELEVANT FACTS

On April 5, 2018, Larkin was arrested at Phoenix Sky Harbor Airport while 

returning from a trip to Europe. On April 9, 2018, the United States filed a Motion seeking 

Larkin’s detention pending the imposition of release conditions. See CR 22. From April 

6, 2018, until Larkin’s release on April 16, 2018, the parties negotiated a package of release 

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conditions in lieu of proceeding with a detention hearing. One of the important terms of 

his release included electronic monitoring. The United States would not have agreed to his 

release without this term. On April 16, 2018, Larkin was released on numerous stipulated 

conditions, including electronic monitoring. See CR 93. Another condition was that 

Larkin not assert control over Backpage. Without any prompting, Larkin advised the Court 

that he hadn’t “been in control [of Backpage] for [the previous] three years.” (Exhibit A; 

RT 4/16/18, lns. 3-11.) On June 1, 2018, Larkin filed a motion requesting that electronic 

monitoring be removed as a release condition. (Doc. 171.)

ARGUMENT

A. Larkin Fails to Articulate Changed Circumstances

Larkin’s motion to modify his release conditions should be denied because he has 

failed to demonstrate changed circumstances. Larkin is incorrect that a “plain reading” of 

§ 3142(c) (3) does not require changed circumstances. Motion at 3 n.1. 

Under the Bail Reform Act of 1984, the “judicial officer may at any time amend the 

[release] order to impose additional or different conditions of release.” 18 U.S.C. 

§ 3142(c)(3). The legislative history of this provision is clear that Congress intended to 

require a showing of changed circumstances to justify a modification of conditions: “[t]his 

authorization is based on the possibility that a changed situation or new information may 

warrant altered release conditions.” S. Rep. 98-225, available at 1983 WL 25404, at *16 

(Aug. 3, 1983); see also United States v. Lafrance, No. 16-10090, 2016 WL 3882845, at 

*1 (D. Mass. July 13, 2016) (“Defendant has failed to show a substantial change in 

circumstances that warrants such a significant change in the conditions of his release, and 

the developments in this case, as described in the summary of the docket (set out above) 

similarly shows no qualifying change in circumstances for the modification sought. To the 

contrary, Defendant’s case has progressed closer to trial: he has been indicted, discovery 

has been provided, and a superseding indictment broadens the scope of potential liability 

and increases the potential penalties.”).

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Courts reviewing requests to amend bond conditions under Section 3142(c)(3) read 

the provision “in conjunction with §3142(f).” United States v. Merola, No. CRIM 08-327, 

2008 WL 4449624, at *2 (D.N.J. Sept. 30, 2008) (“‘Under § 3142(f) of the Bail Reform 

Act of 1984, the Court is expressly authorized to reopen the detention hearing of a 

defendant when material information “that was not known to the movant at the time of the 

hearing” comes to light. Courts have interpreted this provision strictly, holding that 

hearings should not be reopened if the evidence was available at the time of the hearing. 

Thus, the definition of ‘changed circumstances.’”); see also United States v. Wei Seng 

Phua, No. 2:14-CR-00249, 2015 WL 127715, at *1--2 (D. Nev. Jan. 8, 2015) (“Contrary 

to defendants’ assertions, the government’s factual support and reliance on 18 U.S.C. 

§ 3142(f) are justified because this Court must consider whether new information exists 

that was not previously known or presented at the detention hearing to determine whether 

to modify the pretrial release condition at issue.”)

A defendant awaiting trial may reopen a detention hearing “if the judicial officer 

finds that information exists that was not known to the movant at the time of the hearing 

and that has a material bearing on the issue” of whether he will flee or is a danger. 

(emphasis added) 18 U.S.C. § 3142(f)(2). “This provision is strictly interpreted and the 

hearing should not be reopened if the evidence was available at the time of the initial

hearing.” United States v. Santos, No. 2:17-CR-00001 JAD, 2017 U.S. Dist. LEXIS 

68335,4-5 (D. Nev. 3, 2017). For example, the testimony of defendant’s friends or relatives

does not qualify to reopen a detention hearing. United States v. Hare, 873 F.2d 796 (5th

Cir 1989).

Here, there was no detention hearing. Instead, the parties negotiated over ten days

and settled on mutually-acceptable terms for release. One important term insisted upon by 

the United States was active Global Positioning System (GPS) electronic monitoring.

Defendant agreed to this term. Less than two months later, Larkin seeks relief on the 

ground that electronic monitoring is an inconvenience because his family and attorneys are 

located in California. These facts were known to him at the time of his conditional release. 

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They are not materially changed circumstances justifying modification under the Bail 

Reform Act. For this reason alone, the motion should be denied.

B. Misrepresentations to the Court

As noted above, the Court reviewed release conditions with Larkin that included an 

absolute prohibition against any control of Backpage. Larkin responded to the Court’s 

inquiry about whether he understood the prohibition by stating: “Yes, I do. I haven’t been 

in control for three years.” (See Exhibit A.) At trial, however, the United States will show 

that Larkin’s 2015 sale of his interest (he owned 43%) in Backpage was nothing more than 

a sham where he and co-defendant Michael Lacey retained management involvement in 

the website and disguised substantial annual revenue as debt. 

Indeed, the evidence will show that Larkin retained considerable operational control 

over Backpage after the “sale” to Backpage CEO Carl Ferrer (“Ferrer”) in 2015. For 

example, after the sale of Backpage, Ferrer had numerous discussions with Larkin about 

efforts to circumvent conventional banking (after Visa and Mastercard refused to allow sex 

traffickers to use their card services) in order for Backpage to continue to receive revenue. 

Ferrer continued to meet with Larkin in various locations (Phoenix, San Francisco and 

Tucson, among others) to discuss the management of Backpage. Despite having sold the 

website, Larkin was not only very much engaged but insisted that he retain management 

of the legal strategy in an attempt to fend off civil and criminal cases faced by Backpage

so that the revenue stream could continue unabated. 

Moreover, as recently as May 23, 2018, in the Superior Court of the State of

Washington, a judge imposed two $100,000 sanction awards against Larkin, co-defendant

Michael Lacey and other defendants for, among other things, making claims [to the court] 

that were untruthful: 

“Another one that the Court can consider in regards to bad faith is procedural bad 

faith and that is vexatious conduct during the course of litigation, wasting private 

and judicial resources, making claims that, months later, were found to be 

untruthful.” (See Exhibit B, p. 64-65.) 

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Given this recent history, Larkin does not inspire confidence that he would be candid 

with this Court (and his assigned Pretrial Services Officer). For this additional reason, the 

precaution of electronic monitoring is warranted. See United States v. Hir, 517 F.3d 

1081,1092 (9th Cir. 2008) (for release orders to be effective, “they depend on [the 

defendant’s] good faith compliance”) (quoting United States v. Tortora, 922 F.2d 880, 886 

(1st Cir. 1990) (concluding that a similarly extensive set of release conditions contained 

“an Achilles’ heel. . . virtually all of them hinge on the defendant’s good faith compliance” 

and “the conditions as a whole are flawed in that their success depends largely on the 

defendant’s good faith-or lack of it. They can be too easily circumvented or 

manipulated.”). 

C. Nature of the Offense and Strength of the Evidence

Larkin’s rehash of the nature of the offense and the strength of the evidence is 

inaccurate and should be rejected. The United States argued in its original detention motion 

that the strength-of-the-evidence factor supports a flight-risk determination because the 

grand jury has already returned a 93-count indictment, the indictment contains a detailed 

summary of some of the incriminating evidence against Larkin, and the United States 

Senate separately issued a 50-page report recognizing that Backpage and its founders, 

including Larkin, facilitated criminal activity. Larkin’s motion is conspicuously silent 

regarding these points. It also fails to address that Backpage CEO Carl Ferrer and 

Backpage (and four other Backpage-related corporate entities) have pleaded guilty to

conspiring to promote prostitution in violation of 18 U.S.C. § 1952 (Travel Act).

Rather, in his response to the United States’ detention motion, and again in his 

motion to amend conditions, Larkin argues that the strength-of-the-evidence factor favors 

him because the theory underlying the indictment in this case has “been repeatedly 

litigated, and in each case, rejected on First Amendment grounds.” See Motion at 8. 

Although Larkin recognizes that this is not the time to address the ultimate merits of his 

First Amendment argument (Motion n.4), he bases his motion to modify release conditions 

primarily on First Amendment grounds. 

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The United States cannot help but point out that Larkin’s claims are incorrect and

have in recent years been consistently rejected. First, the evidence of Larkin’s involvement 

in the operation and management of Backpage is considerable such that he cannot plausibly 

claim he had no knowledge of the true purpose of Backpage’s business model: to derive 

revenue from prostitution. He certainly cannot claim he was unaware of Backpage’s 

facilitation of prostitution especially in light of Ferrer’s and Backpage’s recent guilty pleas.

Second, Larkin is simply wrong in his claim that “no court” has ever accepted the 

theory that a website or website operator may be criminally prosecuted under federal law 

for knowingly facilitating prostitution. Id. In United States v. Omuro, N.D. Cal. No. CR 

14-CR-336, the founder of the website www.myRedBook.com was convicted of violating 

18 U.S.C. § 1952—the very crime charged in this case. In the factual basis of his plea 

agreement, Omuro (like Ferrer) admitted that “[t]he website hosted advertisements, the 

vast majority of which were posted by prostitutes containing their picture[s], and in most 

instances, the sexual services they offered, and their rates. . . . The website also allowed 

site users to submit, search, and read reviews of the services offered by particular 

prostitutes. . . . As such, the website promoted and facilitated the carrying on of prostitution 

throughout California, elsewhere in the United States, and Canada.” Similarly, in United 

States v. Hurant, E.D.N.Y No. CR 16-45, the founder of the website www.Rentboy.com

was convicted of violating 18 U.S.C. § 1952. In his sentencing memo, Hurant admitted he 

“was well aware . . . that the escort ads he posted . . . were thinly-veiled proposals of sexual 

services in exchange for money.”1

 And again, in 2012, the Department of Justice obtained 

the forfeiture of the website www.escorts.com based on similar conduct. See 

 

1 Hurant has other parallels to this case. In its Hurant sentencing memo, the 

government stated that although the Rentboy.com website “had disclaimers that claimed 

that the advertisements on the site were for companionship only and not for prostitution,” 

the company’s employees would often reject ads containing explicit offers of sex for 

money “but allow the ad to be resubmitted with different language. In many cases, 

Rentboy.com employees would just edit the advertisement’s language and approve it.” 

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https://archives.fbi.gov/archives/philadelphia/press-releases/2012/internet-escortservices-firms-charged-with-money-laundering-sentenced-in-federal-court. 

The results in these cases are hardly surprising and easy to harmonize with the First 

Amendment. Long ago, the Supreme Court recognized that “[w]e have no doubt that a 

newspaper constitutionally could be forbidden to publish a want ad . . . soliciting 

prostitutes.” Pittsburgh Press Co. v. Human Relations Comm’n, 413 U.S. 376, 388 (1973). 

Put simply, the First Amendment does not protect speech promoting criminal conduct. See, 

e.g., United States v. Stevens, 559 U.S. 460, 468-69 (2010) (“From 1791 to the present, 

. . . the First Amendment has permitted restrictions upon the content of speech in a few 

limited areas, and has never include[d] a freedom to disregard these traditional limitations. 

These historic and traditional categories long familiar to the bar—including obscenity, 

defamation, fraud, incitement, and speech integral to criminal conduct—are well-defined 

and narrowly limited classes of speech, the prevention and punishment of which have never 

been thought to raise any Constitutional problem.”) (citations omitted); United States v. 

Meredith, 685 F.3d 814, 819-20 (9th Cir. 2012) (applying “the First Amendment exception 

that allows the government to regulate speech that is integral to criminal conduct”); United 

States v. Rahman, 189 F.3d 88, 116-17 (2d Cir. 1999) (“[F]reedom of speech . . . do[es] 

not extend so far as to bar prosecution of one who uses a public speech . . . to commit 

crimes.”). See also Central Hudson Gas & Elec. Corp. v. Pub. Serv. Comm’n of N.Y., 447 

U.S. 557, 563-64 (1980) (“[T]here can be no constitutional objection [under the First 

Amendment] to the suppression of . . . commercial speech related to illegal activity.”).

Third, Larkin is also wrong in his claim that “the problem is that the government’s 

theory is based on the false premise that Backpage.com engaged in prostitution and sex 

trafficking.” (Motion at 7.) Recent cases against Backpage and Larkin belie this claim. In 

2015, for example, the Washington Supreme Court denied Backpage’s and Larkin’s motion 

to dismiss a civil lawsuit brought by three minor girls who had been “bought and sold for 

sexual services online on Backpage.com.” See J.S. v. Village Voice Media Holdings, Inc., 

359 P.3d 714, 715-16 (Wash. 2015). The Court held that, because the plaintiffs had 

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plausibly alleged that Backpage does “more than just provide a forum for illegal content” 

and affirmatively shapes the content of users’ ads through “posting rules [that are] 

‘designed to help pimps develop advertisements that can evade the unwanted attention of 

law enforcement, while still conveying the illegal message,’” the plaintiffs should be 

permitted to conduct discovery “to ascertain whether in fact Backpage designed its posting 

rules to induce sex trafficking.” Id. at 718. Tellingly, in 2017, following extensive 

discovery, the trial judge in the J.S. case denied Backpage’s motion for summary judgment. 

See Exhibit C. Afterward, Backpage agreed to enter into a confidential settlement with the 

plaintiffs.2 In light of these various courts denying Backpage’s First Amendment 

arguments, it is difficult to understand how Larkin can argue that the government’s case is 

weak and “faces unusual and strong head winds generated by the First Amendment.” See

Motion at 9.

Moreover, less than three months ago—on March 29, 2018—the Hon. Leo Sorokin 

in the District of Massachusetts issued a five-page order denying in part a motion to dismiss 

that Larkin had filed in a civil case brought by a different underage victim who had been 

trafficked via Backpage. See Jane Doe No. 1 v. Backpage.com, LLC, 2018 WL 1542056 

(D. Mass. 2018). The ruling explained that, because the plaintiff had made a plausible 

allegation that Backpage had “redrafted [her] advertisement . . . to suggest she was an 

adult,” the alleged conduct was not covered by the CDA’s grant of immunity. Id. at *1. 

Here, similarly, the indictment and further investigation after indictment demonstrate that 

Backpage helped edit and redraft prostitution advertisements. (Additional related 

arguments are set forth in the Reply in Support of Motion to Disqualify Counsel recently 

 

2 The October 2017 settlement in J.S. v. Village Voice Media Holdings et. al was 

sealed. Travelers Property Casualty Co. is seeking to deny an indemnification claim concerning the settlement, arguing that it has no duty to indemnify and citing exclusions 

that bar coverage for intentional acts, among other things. (See Traveler Property 

Casualty Company of America v. Village Voice Media Holdings LLC, et al, 2:2017cv03994)

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filed by the United States at Doc. 194, pages 5-9. The United States incorporates these 

arguments by this cross-reference.)

Larkin also relies upon the ruling in Backpage.com LLC v. Dart, 807 F.3d 229, 231 

(7th Cir. 2015), that found Backpage’s adult section protected by the First Amendment. 

Yet Larkin fails to acknowledge that, at the time of the ruling, Ferrer and Backpage had 

not pleaded guilty. In the pleas of Ferrer and Backpage (and related corporate entities), 

Ferrer and Backpage acknowledged that Backpage was, in fact, facilitating prostitution. 

Larkin fails to discuss these pleas – and he conspicuously avoids noting that the Dart case 

was dismissed on May 18, 2018 in light of the recent plea agreements. (See Exhibit D). 

The court in that case is now considering sanctions regarding the fact that the litigation 

was even instituted in the first place. (See Exhibit F; Sheriff’s Motion for Sanctions 

Against Backpage and its Attorneys.) 

Fourth, although it is true that Larkin and Backpage have prevailed in a number of 

prior cases that sought civil remedies or that turned on whether Backpage could be 

prosecuted under state criminal law, those cases are easily distinguishable. First, those 

cases are distinguishable for the obvious reason that the CDA provides a broad grant of 

immunity in such contexts. This, however, is a case brought under federal criminal law—

a context in which the CDA has no application. See 47 U.S.C. § 230(e)(1) (“Nothing in 

this section shall be construed to impair the enforcement of 

. . . [any] Federal criminal statute.”). Indeed, the successful prosecutions in the 

myRedBook.com, Rentboy.com, and escorts.com cases demonstrate that federal 

criminal liability may be imposed under these circumstances. Second, those cases are 

also distinguishable because, with one exception (People v. Ferrer), they were decided 

prior to the release of the Senate Report in 2017. That report addressed documents and 

other evidence that were not available when the cited cases were decided. (So, too, did the 

grand jury investigation in this case.) 

Finally, in the District Court of Arizona, during the grand jury litigation that 

preceded the indictment in this case, Judge David C. Campbell and a unanimous threeCase 2:18-cr-00422-DJH Document 197 Filed 06/15/18 Page 10 of 16
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judge panel of the Ninth Circuit rejected Backpage’s First Amendment-based 

challenges to the government’s investigation and theory of the case.3

If convicted of all (or even a portion of) these charges, Larkin—who is nearly 

70 years old—faces the very real possibility of spending the rest of his life in federal 

prison. Such exposure creates a powerful incentive to flee. See, e.g., United States v. 

Townsend, 897 F.2d 989, 995 (9th Cir. 1990) (“Facing the much graver penalties

possible under the present indictment, the defendants have an even greater incentive 

to consider flight.”); United States v. Anderson, 384 F. Supp. 2d 32, 35 (D.D.C. 2005) 

(ordering pretrial detention in white collar case, even though the defendant had no prior 

felony convictions and “no history of violent criminal activity,” in part because “[t]he 

combined statutory maximum penalties for the federal crimes with which Mr. 

Anderson is charged is 23 years. . . . At 51 years old, Mr. Anderson potentially could 

spend most of the remainder of his life in prison if convicted.”).

In addition to the instant federal prosecution, Larkin is facing charges in the 

State of California and is under investigation by the Attorney General in the State of 

Texas. In the final analysis, the prosecution is not facing the “headwinds” of a First 

Amendment defense. Rather, Larkin faces a tidal wave of civil and criminal litigation 

that provides ample motive to flee.

D. Creating Prostitution Based Content

Again, Larkin argues that he does not intend to litigate First Amendment issues 

at this time but then premises his motion to amend release conditions by litigating First 

Amendment issues. Motion at 7, fn. 4. Larkin’s specific argument that he enjoys First 

Amendment protection because Backpage was merely a conduit for content and that 

 

3 On May 17, 2018, Judge Campbell issued an order authorizing the United States to disclose the Grand Jury proceedings in this case. See CR 198 at 7-8 and attached 

exhibits.

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he was not involved in creating content on behalf of pimps and sex traffickers should 

be rejected. 

The strength of the evidence lends greater support for a flight-risk finding. As 

an initial matter, the fact the grand jury has returned an indictment is enough to meet 

the government’s initial burden as to the strength-of-the-evidence factor. See, e.g., 

United States v. Hamlin, 2007 WL 2225868, *1 (E.D. Mich. 2007) (“Under subsection 

(g)(2), from the a grand jury having passed an Indictment, there is a definite weight of 

evidence against the Defendant.”); United States v. Bradshaw, 2000 WL 1371517, *4 

(D. Kan. 2000) (“[T]he grand jury’s indictment, standing alone, establishes probable 

cause for purposes of the Bail Reform Act.”). The considerable evidence currently set 

forth in the indictment weighs in favor of imposing electronic monitoring as a 

condition of release. 

Larkin is aware that the United States (and the States of California and Texas) 

continue to investigate the criminal activity of Backpage. This is evidenced by the fact that 

the United States intends to seek a superseding indictment (see Doc 131; Scheduling 

Order.) and Larkin is well aware that Ferrer’s cooperation included both Attorney Generals 

Offices’ for California and Texas. To that end, the United States continues to investigate

Larkin’s knowledge and involvement regarding content creation for sex traffickers and his 

receipt of revenues from prostitution-related advertising. At trial, the United States will 

demonstrate (primarily through Larkin’s own emails, testimony from Ferrer and public 

acknowledgments by Larkin and others working at his direction) that Larkin was involved

in content creation to increase prostitution revenue. 

1) Strip Filter and Moderation 

While Larkin owned and operated Backpage, the company took an array of 

affirmative steps to help its customers (i.e., pimps and sex traffickers, including child sex 

traffickers) “sanitize” ads and conceal their illegality:

The internal company documents obtained by the Subcommittee 

conclusively show that Backpage’s public defense is a fiction. Backpage has maintained a practice of altering ads before publication by deleting words, 

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phrases, and images indicative of criminality, including child sex trafficking

. . . . Those practices served to sanitize the content of innumerable 

advertisements for illegal transactions—even as Backpage represented to the public and the courts that it merely hosted content others had created.

See January 9, 2017, the Senate Subcommittee on Permanent Investigations 

“Backpage.com’s Knowing Facilitation of Online Sex Trafficking.” Report at 2. See also 

id. at 3 (“Backpage knows that it facilitates prostitution and child sex trafficking. . . . 

Backpage moderators told the Subcommittee that everyone at the company knew the adultsection ads were for prostitution and that their job was to ‘put[] lipstick on a pig’ by 

sanitizing them.”)

Further supporting evidence has emerged. One such example is an email sent to 

Larkin in 2011 (also co-defendant Scott Spear) wherein it is explained that the term “new 

in town” refers to an underage prostitute because “a pimp will have to drive them to the 

location of the customer.”4 This email is significant because three of the victims detailed 

in the indictment were posted in ads that included the language “new in town” three years 

after the subject email. (See indictment, Counts 12-15, 39,41; ¶s 132,133.) As the United 

States has noted, the seriousness of charged offenses and the potential of adding additional 

charges contribute significantly to the risk-of-flight analysis. 

2) Aggregation: Soliciting Posters (i.e. Pimps and Sex Traffickers) From 

Competing Websites

Evidence has come to light that Larkin was aware of and encouraged a business plan 

to solicit users of competing websites to post their prostitution-related ads on Backpage. 

This was informally known as the “The Dallas Plan.”5 In 2007 a marketing plan was 

developed at the Dallas Observer to develop more ad content. The basic theory was that if 

 

4 (See Exhibit E; p. 2 #12, “Finding Illegal Adds, Key Words: “New in Town terminology often used by pimps who shuttle children to locations where they do not know 

anyone and cannot get help. When this phrase is used, moderators should be told to be on heightened alert that the image may belong to [sic] an under 18. )

5 Exhibit G is an agenda from one of the many Backpage management meetings attended by Larkin. Item III is entitled Dallas update. This is example of efforts to aggregate information from the adult sections of other (competing) prostitution websites.

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Backpage marketed to the users and gave them free ads, they could become paying users 

at some point. The Dallas Plan, as it came to be known, was distributed by management, 

including Larkin, and involved the following method for promoting Backpage to sex 

traffickers on other adult websites:

a. Go to Google and type in erotic services and the area code. The 

search would bring up all of the Craigslist ads of sex traffickers in 

that area. 

b. Call the numbers of sex traffickers on the ads and offer them ads. 

The phone calls were being made by the classified ad sales reps 

who were having a hard time selling other ads. 

c. A large percentage of ads sold this way would end up becoming paid ads. This laid the groundwork for users to migrate to Backpage when Craigslist shut down its adult section. 

In 2012, after Craigslist discontinued an adult section in response to public pressure,

the volume of adds to Backpage increased exponentially. As a result, Larkin no longer had 

to solicit adds domestically. Backpage, however, expanded the Dallas Plan overseas to the 

Philippines and Australia by having marketing staff work on stealing content from the other 

(competing) adult websites. In sum, at trial, the United States will demonstrate that Larkin 

and others were involved in content creation for sex traffickers and others using Backpage 

to facilitate prostitution. Again, this activity undermines his First Amendment defense and 

provides an incentive to flee.

3) The Erotic Review

There’s more. A third way that Larkin was involved in content creation included 

his business arrangement with a website known as The Erotic Review (TER). Larkin was 

involved in efforts to increase Backpage’s revenue. At annual meetings, Backpage

management (Larkin, Lacey, Ferrer, Spear and Brunst) discussed strategy, which included 

where both revenue and referrals were coming from. One commonly discussed source of 

referrals was TER, a site with profiles and provides contact information for individual 

prostitutes (including underage sex trafficking victims). With a premium membership, one 

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could also read reviews written by prostitutes’ customers describing the sexual activity 

provided or the lack thereof. 6

Larkin, as founder and manager of Backpage, was familiar with TER. Larkin knew 

the referrals were coming from a prostitute review site and he approved a referral 

arrangement with TER. Backpage had a reciprocal link agreement where Backpage would 

allow links to TER in its ads, but not for competitors and TER would have links on its 

profiles to Backpage ads. At trial, it is expected that Ferrer will testify that he made a deal, 

with the knowledge and approval of Larkin, with the owner of TER to pay $10,000 per 

month to have more referrals to Backpage. The business relationship with TER was 

disguised by intentionally receiving an invoice from TER but with a name like Web 

Services, LLC so that the checks would not have to be written to TER. As a result of this 

agreement, TER increased the number of profile pages that linked to Backpage versus other 

sites. Revenue from TER referrals went up after this deal was made. The government will 

argue at trial that Larkin was aware that the increase in revenue resulted from the increase 

in prostitution-related ads.

/ / / 

/ / /

/ / /

/ / /

/ / /

/ / /

 

6 See exhibit G (agenda of meeting where Larkin was present). Item II(c) references 

“Trade with TER.” This an agenda item that involves an arrangement with TER to trade links. Again, TER is a site that allows individuals to read reviews on prostitutes.

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CONCLUSION

For the foregoing reasons, Larkin’s motion to revisit his release conditions should 

be denied. 

Respectfully submitted this 15th day of June 2018.

ELIZABETH A. STRANGE

First Assistant United States Attorney

District of Arizona

s/Kevin M. Rapp

KEVIN M. RAPP

MARGARET PERLMETER

PETER S. KOZINETS

ANDREW C. STONE

Assistant U.S. Attorneys

JOHN P. CRONAN

Acting Assistant Attorney General

Criminal Division, U.S. Department of Justice

REGINALD E. JONES

Senior Trial Attorney

U.S. Department of Justice, Criminal Division

Child Exploitation and Obscenity Section

Certificate of Service

I hereby certify that on this date, I electronically transmitted the attached document 

to the Clerk’s Office using the CM/ECF system for filing and transmittal of a Notice of 

Electronic Filing to the following CM/ECF registrants: Anne Chapman, Erin McCampbell, 

Gregory Zamora, James Grant, Larry Debus, Lawrence Kazan, Lee Stein, Paul Cambria, 

Robert Corn-Revere, Ronald London, Janey Henze Cook, John Littrell, Kenneth Miller, 

Thomas Bienart, Jr., Bruce Feder, Michael Kimerer, Rhonda Neff, KC Maxwell, David 

Wakukawa, Michael Piccarreta, Stephen Weiss. 

s/Erica Lane

U.S. Attorney’s Office

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