Opinion ID: 1251736
Heading Depth: 1
Heading Rank: 5

Heading: Alleged Inadmissible Statements of Gutierrez.

Text: At trial, Ross's counsel objected to the introduction of Gutierrez's statements to White. Counsel first objected on relevancy and hearsay grounds. The State responded it was not offering Gutierrez's statements for their truth because everything Gutierrez said to White were lies. Rather the State offered the statements as those of a coconspirator in furtherance of a conspiracy to defraud Rita through the $300,000 treasure chest prize scheme. The State argued that Gutierrez's lies to White were an attempt to further the conspiracy by covering up the fraud. Seen in this light, the State contended, Gutierrez's statements were an exception to the hearsay rule. Ross's counsel responded that Ross had left FSN before Gutierrez spoke with White. At this point counsel threw up his hands: There are just so many things wrong with getting into that evidence that II find it objectionable. The State continued: Gutierrez was active in May 1994 in covering up the FSN $300,000 treasure chest pitch and thus his statements were made to conceal the illegitimacy of the operation. The cover-up, the State insisted, was part of the conspiracy. At this point, the nature of the objection by Ross's counsel began to change: THE STATE: Are we alleging that Mr. Ross was at Family Savings Network in May of 1994? No, we're not, but we are alleging that the defendant even at a date long after that and Mr. Gutierrez were very much interested in making sure that investigators for the State would not be able to tie them to Family Savings Network and the cover-upwhen you do a prize scheme like this, the cover-up is a very needed part of it. DEFENSE COUNSEL: The objection now appears to be fairly clear is that you have a Bruton problem. THE COURT: What? DEFENSE COUNSEL: You have a Bruton problem and in the Bruton case statements made to an investigator of law enforcement after the discovery of the crime of conspiracy offered against the defendant by other parties are not admissible, and it raises the confrontation problem, additional hearsay.... Questioning by law enforcement are simply not admissible against any other party, only against themselves. In short, Ross's counsel urged a mixture of objections: hearsay and the inapplicability of the coconspirator exception to the hearsay rule based on a Bruton confrontation violation. The district court overruled the objection and admitted into evidence Gutierrez's statements to White. Ross contends here that the district court erred because these statements were made after the objects and goals of the conspiracy were achieved. He also contends the statements were inadmissible because they were made to a known government investigator. Finally, he contends the admission of such statements violated his Sixth Amendment right to confrontation under the federal Constitution. A. Termination of the conspiracy. On this issue, Ross vigorously contends that by May 13, 1994when White talked to GutierrezRoss had done all he could under the circumstances to withdraw from the conspiracy because he no longer worked for FSN. Ross insists that Gutierrez, through his efforts to cover up his own role, could not re-involve Ross in a conspiracy from which Ross had already withdrawn. For these reasons, Ross concludes, the coconspirator exception to the hearsay rule does not apply and Gutierrez's statements to White were therefore inadmissible hearsay. 1. Applicable law. Article VIII of the Iowa Rules of Evidence codifies the law on hearsay. Rule 801 defines the following: (a) Statement. A statement is (1) an oral or written assertion or (2) nonverbal conduct of a person, if it is intended by him as an assertion. (b) Declarant. A declarant is a person who makes a statement. (c) Hearsay. Hearsay is a statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted. (d) Statements Which Are Not Hearsay. A statement is not hearsay if .... (2) Admission by Party-Opponent. The statement is offered against a party and [is] ... (E) a statement by a coconspirator of a party during the course and in furtherance of the conspiracy. Iowa R. Evid. 801. Thus, a statement is hearsay if it is offered to prove the truth of the matter asserted. Statements not offered for the truth of the matter asserted do not constitute hearsay and should not be excluded on such grounds. State v. Waterbury, 307 N.W.2d 45, 50 (Iowa 1981). Statements by a coconspirator of a party during the course and in furtherance of the conspiracy are likewise not hearsay. Such statements are admissible against the party as an admission by a party-opponent. So it is inaccurate to characterize this rule as an exception to the hearsay rule. A conspiracy is a combination or agreement between two or more persons to do or accomplish a criminal or unlawful act, or to do a lawful act in an unlawful manner. State v. Blyth, 226 N.W.2d 250, 263 (Iowa 1975). The conspiracy does not depend on the fulfillment of the agreement, only that there is an agreement. Id. And the agreement may be established by either direct or circumstantial evidence. Id. When there is substantial evidence of a conspiracy, whether the offense charged is conspiracy or not, everything said by any conspirator in furtherance of the common purpose is deemed to have been said in behalf of all parties to the conspiracy. State v. Kidd, 239 N.W.2d 860, 864 (Iowa 1976). For the rule to apply, two conditions must be met. Id. First, the statement must have been made during the pendency of the conspiracy. Second, it must have been in promotion of the object or design of the conspiracy. Id. Once there is substantial evidence of a conspiracy, the burden is upon the conspirator to show it has ended. Id. Unless the conspiracy has ended, every act in furtherance of it is deemed a renewal or continuance of the conspiracy. State v. Wedelstedt, 263 N.W.2d 894, 899 (Iowa 1978). Thus, a conspiracy may continue into the concealment phase. Kidd, 239 N.W.2d at 864. In the absence of a showing that the conspiracy has ended, the conspirator remains a member of the conspiracy until the conspirator withdraws. United States v. Walls, 70 F.3d 1323, 1327 (D.C.Cir.1995). A conspirator may withdraw by admitting to the authorities the conspirator's involvement in the conspiracy. Id. Or the conspirator may withdraw by communicating the conspirator's abandonment of the conspiracy in a manner reasonably calculated to reach coconspirators. Id. 2. The merits. As mentioned, Ross attempts to brand Gutierrez's statements to White as hearsay, contending that the conspiracy, if any, had ended by the time Gutierrez made the statements. We are convinced there was substantial evidence of the conspiracy. The hotly contested issue is whether Ross's involvement in the conspiracy had ended by the time Gutierrez made the statements to White. As in most illegal schemes, the perpetrators agree either expressly or tacitly that they will do whatever it takes to conceal the scheme from victims like Rita and from the authorities. They do so to continue the scheme or at least to keep the fruits of it and to avoid prosecution. Cf. Waterbury, 307 N.W.2d at 50 (holding that otherwise hearsay statements were admissible because they showed that codefendants conspired to commit murder and as part of the conspiracy agreed to take steps to conceal the conspiracy after its primary goal was achieved). From the impersonations, lies, and threats in this case, the jury could reasonably find that concealment was part of the conspiracy and in furtherance of it. In his statements to White, Gutierrez defended FSN's legitimacy and the legitimacy of the treasure chest prize scheme. He also claimed that the company prohibited the use of aliases by its salespeople and asserted that collection efforts in Rita's case were started because the products she purchased had already been sent. The jury could find that all these statements were lies. The jury could also find these statements were generally designed to preserve the object of the conspiracythe $300,000 treasure chest prize schemeand to conceal the scheme's illegality so as to avoid prosecution. The jury could also find that the conspiracy continued until Ross admitted the fraud and his involvement in it to White. This was long after White had talked to Gutierrez. It is true that Ross left FSN some six months before White talked to Gutierrez. He left not because he wanted to distance himself from the illegal scheme but because of a compensation dispute with FSN. There is no evidence that Ross ever told Gutierrez that heRoss(1) wanted no part of the conspiracy or (2) wanted Gutierrez to discontinue the scheme and its concealment. Experience and common sense tell us that schemers and cheaters rarely walk into a police station and admit their crimes. Given this human proclivity, the jury could easily infer that Ross wanted Gutierrez to do whatever it took to continue the concealment so that Ross would not be implicated criminally and he could keep the fruits of the conspiracy. Thus, any statement Gutierrez would thereafter make to continue the concealment would be in furtherance of the conspiracy and made in behalf of Ross. We conclude the statements Gutierrez made to White were part of the conspiracy and made in furtherance of it. The statements were not hearsay but admissions of a party-opponent under Rule 801(d)(2)(E). The district court was therefore correct in admitting the statements. The statements were not hearsay for another reason: They were not offered to prove the truth of the matters asserted by Gutierrez. Rather the statements were offered to prove that Gutierrez had made the statements and had made them as part of the concealment phase of the conspiracy. See Waterbury, 307 N.W.2d at 50. In Waterbury, a woman conspired with her codefendant-brother to kill her husband. During questioning by the authorities, she claimed that an unknown assailant had killed her husband. Later, she claimed the assailant was her lover, one Ronald Walters. Finally, she signed a statement in which she said her brother killed her husband. We concluded the statements about the unknown assailant and the lover were not hearsay as the codefendant-brother contended and were therefore admissible. We said: The State argues the first two statements were not hearsay as to [the codefendant-brother], because they were not offered as proof of the matters asserted therein. We agree. These statements were not offered to prove the fictitious persons described actually committed the murder. Rather, they were offered to prove [the codefendant-sister] had made the statements, and made them as a part of the concealment phase of the conspiracy. Id. (citations omitted). B. Statements to a known government investigator. Ross points out that Gutierrez knew White was a government investigator when he made the challenged statements to her. Thus, he contends, under Federal law the statements were not admissible under the conspiracy hearsay exception because [they were] not made `during the course and in furtherance of the conspiracy.' In support of his contention, Ross cites United States v. Gallo, 654 F.Supp. 463 (E.D.N.Y.1987) and Federal Rule of Evidence 801(d)(2)(E). We agree with the State that Gallo is easily distinguishable. One of the issues before the court was whether a defendant was entitled to discovery of coconspirators' statements made to a known government investigator. The court in Gallo did say that statements made to known government agents by coconspirators would not be admissible under Rule 801(d)(2)(E) of the Federal Rules of Evidence, because they would not have been made `during the course and in furtherance of the conspiracy.' Gallo, 654 F.Supp. at 468-69. However, one must read this statement in context. Further on in the opinion, the court makes clear that when it made this statement it was referring to statements of a coconspirator who is a prospective government witness. Id. at 478. Presumably such a coconspirator is cooperating with the government, and presumably such statements are damaging because they confirm the conspiracy rather than further it. In contrast, statements made to a known government investigator to conceal the object of the conspiracy while that object is still being pursued are logically made during the course and in furtherance of the conspiracy. As mentioned, this was the rationale this court used in Waterbury when it held that a coconspirator's untrue statements about who killed her husband were admissible. 307 N.W.2d at 50. We therefore find no merit in Ross's contention that Gallo makes Gutierrez's statements to White inadmissible hearsay. C. The alleged Sixth Amendment violation. Without much argument, Ross finally contends that Gutierrez's statements to White were inadmissible under Bruton v. United States, 391 U.S. 123, 88 S.Ct. 1620, 20 L.Ed.2d 476 (1968). Bruton holds that the Confrontation Clause of the Sixth Amendment to the federal Constitution makes inadmissible a non-testifying codefendant's confession incriminating the other defendant. Bruton, 391 U.S. at 126, 88 S.Ct. at 1622, 20 L.Ed.2d at 479. The admission of such a confession violates a defendant's right of cross-examination secured by the Confrontation Clause of the Sixth Amendment. Id. We can quickly dispose of Ross's contention because the State tried Ross alone. Gutierrez was not a codefendant. Bruton simply does not apply.