U.S. v. Gere, 80-1771

• Decision Date: 13 November 1981
• Docket Number: No. 80-1771,80-1771
• Citation: 662 F.2d 1291
• Parties: 9 Fed. R. Evid. Serv. 789 UNITED STATES of America, Plaintiff-Appellee, v. Harold GERE, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1291

662 F.2d 1291

9 Fed. R. Evid. Serv. 789

UNITED STATES of America, Plaintiff-Appellee, v. Harold GERE, Defendant-Appellant.

No. 80-1771.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Sept. 10, 1981.

Decided Nov. 13, 1981.

Dennis E. Kinnaird, Munger, Tolles & Rickershauser, Los Angeles, Cal., for defendant-appellant.

Nancy Wieben Stock, Asst. U. S. Atty., Los Angeles, Cal., for plaintiff-appellee.

Appeal from the United States District Court for the Central District of California.

Before WRIGHT and WALLACE, Circuit Judges, and CARROLL, District Judge. ^*

EUGENE A. WRIGHT, Circuit Judge:

The appellant was convicted by a jury of two counts of mail fraud and one count of violation of 18 U.S.C. § 844(i), all in connection with the arson of the building housing his two businesses. On appeal, he alleges error in admission of coconspirator hearsay, in failure to give a requested immune witness instruction, in failure to give sua sponte an accomplice instruction, and in application of § 844(i) to what was simply arson.

I.

Gere's building was a warehouse containing offices and storage space. It housed his retail and wholesale office and photocopier supply businesses.

The building and its contents burned on May 12, 1979. Firemen and investigators determined from marks on the floor, burn patterns in wood and other materials, and the loci of the fires within the warehouse that the fire had been "set" for delayed ignition from outside the cargo door of the building with the use of "trailers" of photocopier fluid and fluid-soaked materials. The "trailers" were in effect fuses running from the point of ignition into the warehouse.

Gere was connected to the fire by circumstantial evidence. He was the last person in the warehouse before the fire.

His motive was proved by evidence that his retailing business had been undermined by litigation against him for unfair telephone sales practices. Testimony relating out-of-court statements by his general manager, Martin Whiter, was introduced to prove that Gere wished to get out of the business. Whiter and others testified to off-record cash sales of inventory by Gere and Whiter at discount prices. Whiter's out-of-court statements were again used to explain that Gere's intent was to take cash from the business without showing a decrease in inventory. The "paper" inventory's destruction would result in a second payment with insurance proceeds.

Before the fire, Gere arranged a loan secured by inventory. At about that time, an endorsement was added to the fire insurance policy providing for repayment to the bank in the event of destruction of the secured inventory. "Junk" inventory stored at another location was moved into the building.

Morris Singer, an acquaintance in the fire reconstruction business, testified to a conversation with Gere at a club they frequented where Gere asked if he "knew of someone who could make a fire." Though Gere argues that this was only casual conversation, Singer approached at least one person about the possibility of setting the fire.

After the fire, Gere made a request by mail for an advance against his claims under his fire insurance policy. In another mailing he swore that he did not cause the loss.

Gere and Whiter were indicted on four counts: (1) conspiracy to commit mail fraud and violate § 844(i), (2) mail fraud based upon the requested advance, (3) mail fraud based upon the sworn proof of loss, and (4) violation of § 844(i) by use of an "explosive" to destroy the building, resulting in the death of one fireman and the injury of 24 others.

At the close of the evidence, Whiter's motion for acquittal on all counts was granted. The conspiracy count was dismissed as to both defendants. The jury returned a verdict against Gere on the remaining counts.

II.

A. Coconspirator Hearsay

Whiter's out-of-court statements were allowed before the jury under the coconspirator hearsay exception. Preceding the testimony, the court cautioned the jury that it was admitted subject to the finding of a conspiracy between Whiter and Gere. The jurors were instructed to "compartmentalize" the testimony they were to hear and not consider it until they were convinced beyond a reasonable doubt that there was a conspiracy. Concurrently, the judge instructed that the conspiracy had not yet been proved.

Before closing arguments, the court told the jury that sufficient evidence had not been presented from which it could find beyond a reasonable doubt that there was a conspiracy between Whiter and Gere. It then dismissed the first count of the indictment. The court made no specific reference to the effect of this finding on the testimony previously heard. Defense counsel did not object, or refer in closing argument to the effect of the court's no-conspiracy finding upon testimony previously presented.

Because timely objection was not made, the "plain error" standard of review is to be applied. Fed.R.Crim.P. 30; United States v. Krasn, 614 F.2d 1229, 1235 (9th Cir. 1980). We are to decide whether it is plain error not to give a final "connecting up" instruction regarding the effect of a no-conspiracy finding upon hearsay testimony conditionally admitted under the coconspirator exception to the hearsay rule.

The appellant argues that before hearsay declarations go before the jury, the judge is required to make a determination on the record whether the government has sufficiently proved conspiracy and to rule on the ultimate admissibility of the testimony. Because of failure to do so, the jury was allowed to consider hearsay testimony.

Where hearsay testimony is conditionally introduced, we have required that the trial judge make the ultimate determination of whether a foundation has been established. United States v. Eubanks, 591 F.2d 513 (9th Cir. 1979); United States v. Weiner, 578 F.2d 757 (9th Cir.), cert. denied, 439 U.S. 981, 99 S.Ct. 568, 58 L.Ed.2d 651 (1978). Before the testimony will be allowed to go to the jury, the prosecution must show that (1) the declaration was in furtherance of the conspiracy, (2) it was made during the pendency of the conspiracy, and (3) there is independent proof of the existence of the conspiracy and of the connection of the declarant and the defendant to it. Weiner, 578 F.2d at 768.

The quantum of independent proof required for the third element of the foundation requirement is "sufficient, substantial evidence to establish a prima facie case." Weiner, 578 F.2d at 768. We have recently emphasized the importance of the first element in United States v. Fielding, 645 F.2d 719 (9th Cir. 1981), holding that mere descriptions of the conspiracy to a nonconspirator are not "in furtherance of" the conspiracy.

The trial judge may make a preliminary determination of admissibility or may admit the testimony conditionally, subject to "connecting up" with the foundation to be eventually laid by the prosecution. United States v. Zemek, 634 F.2d 1159, 1169 (9th Cir. 1980), cert. denied, 450 U.S. 916, 101 S.Ct. 1359, 67 L.Ed.2d 341 (1981) and --- U.S. ----, 101 S.Ct. 1525, 67 L.Ed.2d 821 (1981).

When there has been sufficient evidence to sustain a finding of conspiracy, we have held that giving an instruction like that given here not reversible error. We have called such an instruction "unduly generous." United States v. Miranda-Uriarte, 649 F.2d 1345, 1351 n.4, 1353 (9th Cir. 1981); United States v. Lutz, 621 F.2d 940, 946 n.2 (9th Cir.), cert. denied, 449 U.S. 859, 101 S.Ct. 160, 66 L.Ed.2d 75 (1980) and 449 U.S. 1093, 101 S.Ct. 890, 66 L.Ed.2d 822 (1980); United States v. Testa, 548 F.2d 847, 853 n.3 (9th Cir. 1977).

It is generous when the judge finds sufficient evidence to take the conspiracy count to the jury. Though there is enough evidence to permit the admission of the coconspirator hearsay, the judge thereby imposes the further requirement that the jury find conspiracy beyond a reasonable doubt before considering the hearsay testimony. In this circumstance, whether the jury performs this mental gymnastic is of little consequence, since the coconspirator hearsay is properly admitted anyway.

But, when the instruction is given preliminary to the conditional admission of the testimony, and no more is said except that the judge finds no conspiracy, whether the jury then strikes the testimony from its consideration is crucial. The danger of its not doing so is that it may consider inadmissible hearsay.

In this situation (where conspiracy has been charged, testimony conditionally admitted with an instruction that the jury is not to consider it until conspiracy is found beyond a reasonable doubt, and a no-conspiracy finding is later made and the count dismissed) we believe greater caution should be used to assure that the jury adequately connects up the no-conspiracy finding with the previously admitted testimony. The jury should be instructed to ignore the specific items of testimony conditionally admitted. ¹

The question here, however, is whether the trial judge's failure to so instruct constituted plain error. We hold that it did not.

The conditionally admitted testimony largely described Gere's bleeding cash from the business, suggesting an intent to exploit the destruction of the inventory by presenting a false picture of its amount. But, this was not the only evidence of the cash sales nor was it the only evidence suggesting Gere was responsible for the arson. On these facts the district judge did not commit plain error.

B. Immune Witness Instruction

Gere argues that Morris Singer thought he was testifying under immunity from prosecution and that the court should have given a requested immunized witness instruction.

The court entertained a proposed immune witness instruction. It declined to give that, but promised to give its "substance." Gere's counsel argued that the court would instruct the jury to consider Singer's testimony as if he were an immune witness. After instructions were...