U.S. v. Penaloza

• Court: U.S. Court of Appeals — Seventh Circuit
• Writing for the Court: Before POSNER, FLAUM, and SYKES, Circuit Judges.
• Citation: U.S. v. Penaloza, 648 F.3d 539 (7th Cir. 2011)
• Decision Date: 05 August 2011
• Docket Number: No. 09–3549.,09–3549.
• Parties: UNITED STATES of America, Plaintiff–Appellee,v.Nora PENALOZA, Defendant–Appellant.

648 F.3d 539

UNITED STATES of America, Plaintiff–Appellee,

v.Nora PENALOZA, Defendant–Appellant.

No. 09–3549.

United States Court of Appeals, Seventh Circuit.

Argued Oct. 26, 2010.Decided Aug. 5, 2011.

Stephen A. Kubiatowski (argued), Attorney, Office of the United States Attorney, Chicago, IL, for Plaintiff–Appellee.Timothy G. Shelton, Jennifer M. Ballard (argued), Attorneys, Hinshaw & Culbertson, Chicago, IL, for Defendant–Appellant.Before POSNER, FLAUM, and SYKES, Circuit Judges.SYKES, Circuit Judge.

In November 2006 Nora Penaloza drove from New Jersey to Bedford Park, Illinois, where she met with a man named “Carlos” in the parking lot of a motel. “Carlos” loaded three duffel bags containing packages wrapped in brown tape into Penaloza's car. Penaloza then began to drive back to New Jersey. Agents from the Drug Enforcement Administration (“DEA”) stopped Penaloza, questioned her about the duffel bags, and seized them. Penaloza was indicted for attempting to possess with intent to distribute over five kilograms of cocaine in violation of 21 U.S.C. § 841(a)(1).

During Penaloza's trial, the jury heard the testimony of Mario Elias, a DEA agent who was undercover as “Carlos.” Elias explained that his transaction with Penaloza developed out of an investigation into the activities of Jorge Gutierrez, a suspected broker for a Colombian drug-trafficking organization. Elias testified that in his undercover identity as “Carlos,” he had agreed to help Gutierrez transport a large shipment of cocaine. Gutierrez told him to call Penaloza's phone number to make arrangements for delivery of part of this shipment. Over multiple taped phone conversations, Elias and Penaloza made plans to meet at the motel parking lot near Chicago where he delivered the three duffel bags containing sham cocaine to Penaloza. The government also introduced the testimony of David Brazao, one of the DEA agents who stopped Penaloza en route to New Jersey. Brazao testified that Penaloza confessed to the agents that she understood the duffel bags contained drugs.

The jury convicted Penaloza, and she was sentenced to 120 months of imprisonment. Penaloza appeals, arguing that (1) the district court erred in admitting Elias's testimony about her connections to Gutierrez because it was hearsay and unfairly prejudicial; (2) the admission of this evidence amounted to a constructive amendment of the indictment in violation of the Fifth Amendment; and (3) the district court erred in admitting Agent Brazao's testimony about her confession because it lacked foundation and was unfairly prejudicial. Each of these arguments lacks merit, and we affirm.

I. Background

During the course of its investigation into Jorge Gutierrez, also known as “Elivardo,” the DEA obtained the assistance of a confidential informant (“CI”) who worked for Gutierrez. The CI introduced Agent Elias to Gutierrez as “Carlos,” a narcotics transporter who could help them make international deliveries of cocaine. In early 2006 Gutierrez arranged for the CI and “Carlos” to transport 200 kilograms of cocaine from Colombia to Spain.

Unbeknownst to Gutierrez, the DEA, in conjunction with Spanish law-enforcement authorities, intercepted and seized this shipment of cocaine. Elias contacted Gutierrez and told him a cover story so the DEA could continue its investigation. Elias told Gutierrez that when he arrived in Spain to make the delivery, the buyers were unable to pay for the cocaine and asked for credit. Elias said he released 130 kilograms of the cocaine to the buyers and held the remaining 70 kilograms as collateral to ensure that they followed through with payment. Elias later told Gutierrez that he was bringing the 70 kilograms back to the United States and would hold it for Gutierrez to find another buyer.

Gutierrez eventually found a buyer. In early November 2006, the CI gave Elias a phone number and told him to call “Chavelo” to negotiate delivery of the 70 kilograms of cocaine. Separately, Gutierrez contacted Elias and also told him to call “Chavelo” at the same number. Elias called the number but no one picked up. About 15 minutes later, a woman called Elias back from the number. Elias did not know the identity of the speaker; he understood “Chavelo” to be a code name or nickname, and the caller did not identify herself by name. After numerous subsequent conversations and an eventual in-person meeting to deliver the cocaine, however, Elias identified Penaloza as the person in all the calls.

From November 6 to November 9, 2006, Elias taped nine phone conversations with Penaloza during which they tersely discussed the planned transaction using code words. All the conversations were in Spanish. During Elias's first phone conversation with Penaloza, he introduced himself as “Carlos” and told her he was “calling on behalf of Elivardo.” Penaloza responded, “Ah, let's see, what can I say, I would ... I would have to call you back. Or if it's not me, it will be my cousin Leo.” Later that evening, Penaloza called Elias again. She said she had spoken with her “cousin” and “he told me if you were ready ... that I'm the one who's picking up the keys.” Elias understood “keys”—“ llaves ” in Spanish—to be a street term for kilograms. Elias then asked Penaloza whether she was “bringing a car that's ready.” Penaloza answered, “[A]h, let's see ... I'd say no. Not really.” Elias responded, “[T]he only thing that I said to Elivardo, was, that I needed for you to bring a car that was ready ... so that I could go and take it, load the family and give it to you....” According to the trial testimony of an FBI narcotics investigator, “family” is a code word for a shipment of cocaine. In a conversation the following day, Penaloza stated, “[T]he only thing I have to do is go pick up the keys.... I don't have to take anything else?” Elias understood her to be referring to purchase money for the cocaine and answered “no,” but added, “I need a car that's set up,” by which he meant a car with a hidden compartment. Penaloza answered, “I have a Pontiac but it's little.... [Y]ou need a big one, right?” Elias responded, “[D]oes it have some place ... to hide that, or not?” Penaloza replied, “No,” and Elias stated, “Well, it can be put in the back ... in the trunk, then ... there's seventy.” A few hours later, Penaloza again called Elias, and Elias asked her if the car had a “ clavo,” a Spanish slang term for a hidden compartment.

Penaloza and Elias planned to meet on the morning of November 9, 2006, in the parking lot of the Sleep Inn motel in Bedford Park, Illinois, near Chicago. When they met, Penaloza said to Elias, “Leo told me to ... ask you if everything was OK[,] well-packed and the appearance good and everything.” Elias responded, “Everything's fine. I had to put it ... double in each package ... so it wouldn't be ... so bulky.” Penaloza then gave Elias the keys to her SUV, which Elias drove to another location to load with three black duffel bags containing sham cocaine wrapped in brown tape. Elias then drove the car back to the motel parking lot where he explained to Penaloza, “The packages are one and a half each one, because ... of the way we had to send them over here.” The tape recording of this conversation captured a zipping sound from the duffel bags as Elias explained how the cocaine was packaged, and surveillance agents photographed Elias and Penaloza while they stood at the SUV. To conclude the transaction, Elias called Gutierrez and handed the phone to Penaloza. He asked Penaloza to “[t]ell him I took good care of you so he won't bother me.” Penaloza took the phone and said, “Carlos was very proper, OK? He took care of me. He was very worried about me.”

Penaloza then began to drive back to New Jersey, and DEA agents followed her for about 45 minutes before stopping her in Indiana. The agents read Penaloza her Miranda warnings and then asked her about the cocaine in her car. According to the police report summarizing the stop, Penaloza initially said she had traveled to Chicago as a Mary Kay Cosmetics representative, had just checked out of her hotel, and did not know how the three duffel bags ended up in her car. On further questioning, however, Penaloza admitted this was untrue and told the agents that her cousin had offered her $500 to go to Chicago to retrieve some packages and bring them back to New Jersey. When asked if she knew whether the bags in her car contained drugs, Penaloza said, “Yes.” The agents seized the duffel bags and let Penaloza return to New Jersey.

A grand jury later indicted Penaloza for attempting to possess more than five kilograms of cocaine with intent to distribute, in violation of 21 U.S.C. § 841(a)(1). The government moved in limine to introduce certain background information about the DEA's investigation of Gutierrez. It asked the court to allow the introduction of evidence that the DEA had been investigating Gutierrez; that Elias and Gutierrez had negotiated the transportation of cocaine to Spain; that Elias told Gutierrez that the Spanish buyers failed to pay and asked Gutierrez to find a buyer for the 70 kilograms of cocaine in the United States; and that Gutierrez subsequently provided Elias with Penaloza's phone number to arrange for delivery of the 70 kilograms of cocaine. The government said the purpose of this evidence was to provide the jury with context about why Elias contacted and ultimately met with Penaloza.

The government also sought to introduce certain statements by Gutierrez inculpating Penaloza, invoking Rule 801(d)(2)(E) of the Federal Rules of Evidence, which provides that statements by a defendant's coconspirator made during the course and in furtherance of the conspiracy are not inadmissible hearsay. Pursuant to United States v. Santiago, 582 F.2d 1128 (7th Cir.1978), the government submitted a written proffer to the district court to try to establish the required preliminary showing that Penaloza and Gutierrez were...