U.S. v. Testa

• Decision Date: 22 February 1977
• Docket Number: Nos. 75-3316 and 75-3792,s. 75-3316 and 75-3792
• Parties: 1 Fed. R. Evid. Serv. 1307 UNITED STATES of America, Plaintiff-Appellee, v. James Joseph TESTA, Defendant-Appellant. UNITED STATES of America, Plaintiff-Appellee, v. Edward EPSTEIN, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 847

548 F.2d 847

1 Fed. R. Evid. Serv. 1307

UNITED STATES of America, Plaintiff-Appellee, v. James Joseph TESTA, Defendant-Appellant.

UNITED STATES of America, Plaintiff-Appellee, v. Edward EPSTEIN, Defendant-Appellant.

Nos. 75-3316 and 75-3792.

United States Court of Appeals, Ninth Circuit.

Feb. 22, 1977.

Ernest Y. Yamane, Bicoy & Yamane, Honolulu, Hawaii, for Testa.

William J. Eggers, III, Asst. U. S. Atty., Honolulu, Hawaii, for plaintiff-appellee.

Burton Marks, Beverly Hills, Cal., for Epstein.

Appeal from the United States District Court for the District of Hawaii.

Before ELY and TRASK, Circuit Judges, and ORRICK, ^* District Judge.

OPINION

ORRICK, District Judge:

James Joseph Testa and Edward Epstein appeal from their convictions, after a jury trial, for conspiracy with intent to distribute seven kilograms of heroin in return for $100,000 tribute money for assistance and protection in the transaction in violation of 21 U.S.C. § 846, and for knowing and intentional distribution of one kilogram of heroin in violation of 21 U.S.C. § 841(a)(1). The six co-defendants with whom appellants were indicted pleaded guilty to these or related charges.

The appellants make several assignments of error, objecting to the trial court's failure to strike testimony concerning acts and declarations occurring prior to or after the conspiracy charged; asserting that the court allowed the jury to consider the extrajudicial declarations of co-conspirators without sufficient evidence aliunde of the existence of the conspiracy and appellants' knowledge of and participation in it; contesting the admission into evidence of consensually monitored tapes of telephone calls of the informant and appellants, recorded by an undercover agent; and, as to Epstein alone, urging that the trial court's denial of his motion for change of venue constituted a deprivation of due process and a fair trial. For the reasons hereinafter stated, we affirm the judgments below.

I.

The government based its case largely on the testimony of informant Jerry Ray, a convicted felon who received subsistence pay, a reward, and relocation expenses for his assistance. Ray met the two appellants in Los Angeles in July, 1973, when he attended two meetings arranged to discuss a heroin transaction. Testa attended only the first meeting and Epstein was present only at the second meeting. RT 21-22, 89, 130, 140. The deal never transpired because Ray and one Eckhart, who were acting as middlemen, learned that their ultimate purchasers were undercover police officers.

Ray began to cooperate with the government in late August or early September, 1973, after having been indicted for conspiracy. RT 28. In September, 1973, Ray contacted co-defendant Perrelli (Perri) in Las Vegas and asked whether the heroin deal was still available. Perri said that it was and telephoned John Lee in Honolulu. Ray also contacted co-defendant DeRosa, informing him that one Johnny Searing, actually Agent George Redden (hereinafter referred to as Searing/Redden), was interested in purchasing heroin, and inquiring whether the heroin was available and whose contact Lee was. DeRosa said that the heroin was available, that Searing/Redden should be checked out further, and that the contact was his, not Perri's. RT 33.

Approximately one week later, Ray met with Epstein in Las Vegas. Epstein advised that, according to DeRosa, the transaction could take place but that Searing/Redden should be investigated. At a subsequent meeting toward the end of September, DeRosa told Ray the price per kilogram; Epstein was present but took no part in the conversation. In early October, 1973, Ray and Searing/Redden went to Honolulu to discuss the transaction with Lee, who confirmed the price of the heroin. Ray and Searing/Redden were to return to Los Angeles and await the arrival of an initial shipment of heroin which Lee had agreed to front to Searing/Redden. The shipment did not arrive. Thereafter, Ray met with DeRosa and Testa. DeRosa informed Ray that tribute must be paid to the Los Angeles organization for any heroin brought into the area. He told Ray to advise Searing/Redden of this fact and to notify Testa of his response. Later that day, Ray called Testa and informed him that Searing/Redden was balking at the tribute demand. The conversation was recorded with Ray's consent.

DeRosa, Testa and Ray met the next afternoon pursuant to directions relayed to Ray by Testa. DeRosa inquired as to the amount of heroin involved. When Ray mentioned to DeRosa that Searing/Redden was hesitating about the tribute payment, DeRosa and Testa asked to see him. After Ray summoned him, DeRosa and Searing/Redden conversed, with Ray and Testa walking behind and able to hear, according to Ray, "(j)ust a little" of the conversation. RT 50.

Ray and Perri traveled again to Hawaii, obtained a heroin sample from Lee for Searing/Redden (which was first turned over to a Dallas DEA agent and then analyzed in Kansas City), and returned to the mainland. Following further arrangements, Epstein contacted Ray and scheduled a meeting, at which Epstein told Ray that if a transaction had taken place, there was tribute to be paid. Epstein also said that DeRosa felt Lee and Searing/Redden were trying to deal without paying the tribute. RT 62.

Late in November or early in December Ray called DeRosa. Epstein came on the line and gave Ray a "clean number" (a pay telephone number or one known to have no government wiretap on it). (Epstein testified that when he was notified of court-authorized wiretaps at DeRosa's offices, DeRosa explained that he was under federal investigation. Epstein said he believed the investigation was for some sort of gambling charges.) The subsequent conversation, between Ray and Epstein, was taped with Ray's permission. Another meeting resulted from the conversation, this time with Searing/Redden, Ray, DeRosa and Epstein. Searing/Redden told DeRosa that he did not feel he should pay the tribute, asserting that he was from Kansas City and owed nothing to the Los Angeles faction. He also questioned Lee's ability to deliver the quantity of heroin discussed. DeRosa stated again that there would be no transaction anywhere without tribute and said that the Los Angeles faction had strong ties in the Kansas City area. Epstein affirmed DeRosa's influence in Kansas City.

In mid-December, Searing/Redden and Lee arranged in a taped conversation, at which Ray was present with Searing/Redden, for Searing/Redden to come to Hawaii with his money to consummate the transaction. Searing/Redden subsequently went to Hawaii, obtained two kilograms of heroin from Lee, and arrested Lee and his cohort Kaulia. The mainland defendants were unaware of the arrest. On January 10, 1974 DeRosa and Ray spoke on the telephone; Ray said that the deal had transpired and that he was prepared to deliver the tribute money ($100,000). DeRosa said that the money could be delivered either to Los Angeles or to Kansas City. The conversation was recorded by Searing/Redden with Ray's permission.

On January 12, Milano and Ray spoke (and Searing/Redden, with Ray's permission, recorded the conversation) about plans for delivery of the tribute. The DEA surveilled the scene and photographed one of the co-defendants, Eugene Williams, waiting outside the designated location for the tribute money.

With the exception of the issue concerning the denial of Epstein's motion for change of venue, the issues raised on appeal are in all pertinent respects common to both appellants. We will address the common issues first.

II.

Both appellants contend that motions to strike testimony concerning the two July, 1973, meetings, the first attended by Testa and the second by Epstein, should have been granted. Appellants point to the fact that this earlier plan was abandoned and was not part of the conspiracy for which appellants were indicted.

This contention rests on two distinct rules, neither of which mandated that the testimony be stricken. The first is that acts not part of the conspiracy charged may not be used as evidence that the accused committed the acts charged in the indictment. See Fed.R.Evid. 404(b). The government correctly responds that the evidence of July activity was introduced for purposes specifically permitted under the federal rule: to show motive, opportunity, intent, plan, scheme, knowledge, modus operandi, or absence of mistake or accident. ¹ See Fed.R.Evid. 404(b); United States v. Castro,476 F.2d 750, 753 (9th Cir. 1973); United States v. Nunez, 483 F.2d 453, 455-456 (9th Cir. 1973), cert. denied 414 U.S. 1076, 94 S.Ct. 594, 38 L.Ed.2d 483 (1973).

Similarly, acts by others (and statements by others, if not offered for the truth) before or after the conspiracy may be relevant in suggesting the existence and aims of the conspiracy charged. United States v. Costello, 352 F.2d 848 (2d Cir. 1965), cert. granted on another issue 383 U.S. 942, 86 S.Ct. 1195, 16 L.Ed.2d 205 (1965); see Lutwak v. United States, 344 U.S. 604, 73 S.Ct. 481, 97 L.Ed. 593 (1953); United States v. Wentz, 456 F.2d 634, 637 (9th Cir. 1972).

The second rule on which appellants rely is that hearsay statements of co-conspirators are inadmissible against others unless made in furtherance of the conspiracy charged. See Krulewitch v. United States, 336 U.S. 440, 442-443, 69 S.Ct. 716, 93 L.Ed. 790 (1949) (hearsay declaration made if at all after objective of conspiracy had either failed or been achieved not admissible on theory that was made in furtherance of alleged conspiracy). Again, the statement of the rule is accurate, but the rule does not necessitate exclusion of the evidence to which appellants object.

The statements in question were admissible for a non-hearsay purpose to show that the parties who made the statements met and had a discussion. See Anderson v. United States, 417 U.S. 211, 219-221, 94 S.Ct. 2253, 41 L.Ed.2d 20 (1974). Moreover, as indicated above, the...