U.S. v. Kragness

Decision Date24 November 1987
Docket NumberNos. 86-5087--86-5091,s. 86-5087--86-5091
Parties23 Fed. R. Evid. Serv. 1151 UNITED STATES of America, Appellee, v. Leonard Wayne KRAGNESS, a/k/a Sonny Kragness, Appellant. UNITED STATES of America, Appellee, v. Dennis Lloyd DETERS, Appellant. UNITED STATES of America, Appellee, v. Peter Bernhard CASPERSEN, Appellant. UNITED STATES of America, Appellee, v. Jerald Arthur HOLBROOK, Appellant. UNITED STATES of America, Appellee, v. Ronald Francis PRESCOTT, Appellant.
CourtU.S. Court of Appeals — Eighth Circuit

Jack L. Nordby, Minneapolis, Minn., for appellant Kragness.

Mark W. Peterson, Minneapolis, Minn., for appellant Caspersen.

Douglas W. Thompson, St. Paul, Minn., for appellant Deters.

Earl P. Gray, St. Paul, Minn., for appellant Prescott.

Joan Ericksen, Asst. U.S. Atty., Minneapolis, Minn., for appellee.

Before HEANEY and ARNOLD, Circuit Judges, and LARSON, * Senior District Judge.

ARNOLD, Circuit Judge.

Defendants Leonard Kragness, Dennis Deters, Peter Caspersen, Jerald Holbrook, and Ronald Prescott were charged in a thirteen-count indictment with conspiring to violate and violating the Racketeer-Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. Secs. 1962(c) and (d), with several drug conspiracies, and with other substantive offenses. According to the indictment, the defendants were participants in an organization that, between 1976 and 1984, imported and distributed, and conspired to import and distribute, substantial quantities of marijuana, cocaine, and methaqualone, or quaaludes. They were tried jointly in the United States District Court for the District of Minnesota, 1 and each was convicted of two or more of the crimes charged against him. The defendants raise a number of issues on appeal from these convictions, including issues concerning the interpretation of RICO, double jeopardy, a defendant's right to confront witnesses, prosecutorial comment upon a defendant's failure to testify, and a variety of evidentiary questions. 2 In the main, we affirm.

I. Facts

We state the facts in the light most favorable to the jury's verdict. The drug organization that is the subject of the indictment began in the small town of Spring Grove, Minnesota. The two central figures in this organization, defendants Leonard Kragness and Dennis Deters, are from Spring Grove and resided there at the outset of these events. Kragness then owned a plumbing and heating business, and Deters owned Deters Veneer and Lumber. Deters's business was later to provide a cover for the drug business; for example, members of the drug organization often claimed to be searching for timber for Deters's company when they were conducting drug-related activities. Two other participants in the business, defendant Jerald Holbrook and government witness Richard Lager, were also from Spring Grove. Holbrook worked for Deters in the lumber business before the drug business began, and continued to be his employee thereafter. John Teeter, a key participant in early drug undertakings, lived in Spring Grove for two years beginning in 1973, and met Kragness then. Defendant Peter Caspersen grew up with Teeter in South Minneapolis Minnesota, but lived in Colorado when the drug business began.

The government's evidence related to four periods or categories of drug activity involving the defendants. First, there was evidence of drug importation and distribution by Kragness and Teeter from 1976 or 1977 to 1978. Second, there was evidence of a later project to import marijuana from Mexico involving use of a La Junta, Colorado airstrip; events related to this project occurred primarily in 1979. Third, there was evidence of a cocaine-and-quaalude importation project in 1979-1982; most of these transactions involved use of an airport and hangars in Anadarko, Oklahoma, and of a rented house in nearby Chickasha, Oklahoma. Finally, there was evidence of Mexico-Arizona marijuana-smuggling activities undertaken in 1981-82.

The government presented the testimony of about 30 witnesses, but the principal witnesses for the government were three men who participated in this drug business: Richard Lager, Anthony Benanti, and Walter Schieche. Lager, who had been granted immunity from prosecution, testified about Kragness's early drug business with Teeter, about the marijuana importation projects, and about a shipment of cocaine that he helped distribute. Benanti and Schieche, each of whom testified pursuant to a plea agreement, told of the cocaine-and-quaalude end of the business. Benanti had been arrested on drug charges in June 1982, and had served as a government informant for about two years thereafter. Besides the testimony of these and other witnesses, the government introduced a substantial volume of telephone and credit-card records, tracing the movement of and communication between participants in these drug activities, as well as numerous financial documents and records, tracing the money involved. 3

A. Early Drug Activities

Kragness, while recruiting Lager for his drug operation in 1979, told Lager of his drug activities with John Teeter during several preceding years. Kragness, a licensed pilot, stated that, among other things, he and Teeter had flown planeloads of marijuana from Mexico into the La Junta, Colorado area, and upon landing had taken the marijuana to the Colorado home of Teeter's friend, Peter Caspersen. 4 Kragness closed his plumbing business at some point before 1979, and became for a time nominally an employee of Deters's lumber business; however, other regular employees of the lumber business testified they never saw Kragness do work for the company.

In 1977-1978, Kragness and Teeter were distributing drugs to a man in Quincy, Illinois named Gene Ferry, according to the testimony of Ferry's girlfriend and of one of his drug customers, Jimmy Schlemm. Ferry worked for a short time in the summer of 1977 in the lumber business of a man who did work for Deters; Ferry had gotten the job after Deters, during a meeting at which Kragness and Holbrook were present, requested that he be hired. In the fall of 1977, Ferry went to work selling marijuana for Kragness. On one occasion in late 1977, Kragness delivered four or five pounds of marijuana to Ferry, and in early 1978 Kragness delivered a kilogram of cocaine to Ferry. In March 1978, in a delivery engineered by Kragness, Teeter brought marijuana and hashish from Colorado to Ferry in Illinois. On March 21, 1978, Teeter went with Ferry to sell part of this shipment to Schlemm; Schlemm murdered Teeter and Ferry, crimes for which he is now imprisoned in Illinois. During the investigation of these murders, Kragness made efforts to prevent discovery of his involvement with Teeter in drugs; however, Kragness on at least one occasion acknowledged to an investigator that he had played a role in marijuana importation.

B. La Junta Marijuana Operations

Lager's first drug-related transaction with Kragness was in November 1978, when he lent Kragness $1,000 and a month later received $1,500 as repayment. Then, in February 1979, Kragness had Lager locate property near La Junta, Colorado for use as a clandestine airfield in the importation of marijuana from Oaxaca, Mexico. After Kragness inspected and approved the land Lager located, Lager, using Kragness's money, purchased the land, placing title in his own name. At the time of the land purchase, Kragness offered, and Lager accepted, a job as a "transporter" in Kragness's drug operation; Lager was to pick up drugs when planes arrived and carry them in a truck to further distribution points. Lager in fact began to perform this task, as well as a variety of others, making him a sort of general errand-boy for the drug organization.

Lager's first chance to act as a transporter came in August 1979, when, at Kragness's request, he traveled to Colorado with Deters and Holbrook. Kragness hoped to have Deters, who is a licensed pilot, take his place and serve as pilot on a drug run into the La Junta airfield. However, Deters was unable at this point to gain the confidence of Salvatore "Sam" Aleto, 5 a financial backer of the project. So the run was aborted, and Lager returned to Minnesota. Lager went to Colorado again in October and before Thanksgiving in November to meet anticipated planeloads of marijuana, but no loads arrived; Lager was told on the latter occasion that Holbrook had driven the marijuana from Mexico to California.

Then, late one night, shortly after Thanksgiving in 1979, Lager, at Kragness's direction, met a plane piloted by Deters and loaded with marijuana at the La Junta airstrip. Lager, Deters, and Kragness loaded the marijuana into a pickup truck. Lager drove the truck to Peter Caspersen's house, where he spent the night. The next morning, Kragness, Deters, and Aleto arrived. The men weighed the marijuana on Caspersen's scale and divided it among Aleto, Caspersen, and Kragness, each of whom had customers for the marijuana. Lager then drove Kragness's share of marijuana to Kragness's Nederland, Colorado home, where he hid it in a chimney. Kragness and two Canadian customers arrived later, and it was agreed that Lager would drive the marijuana to Grand Coulee Dam, Washington, and that Kragness would fly the marijuana from there to Canada. Lager met Kragness and one of the Canadians at the Grand Coulee Dam Airport, and helped them load the marijuana on Kragness's plane. Kragness and the Canadian took off, and Lager returned home.

Shortly before Christmas in 1979, Lager participated in another drug transaction similar to the transaction just after Thanksgiving. Deters piloted a planeload of marijuana into La Junta, Lager transported the marijuana to Caspersen's home, where it was divided up, and Lager then took Kragness's share to Kragness's home in Nederland. After Christmas, Lager drove the marijuana to Grand Coulee Dam,...

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