Opinion ID: 437553
Heading Depth: 2
Heading Rank: 2

Heading: Prejudicial Effect of Evidence of Ledger Entries

Text: 96 We have concluded that the ledger entries were inadmissible under the Confrontation Clause as proof of the matter asserted because the government failed to demonstrate (1) the unavailability of the unidentified declarants, (2) the trustworthiness of their statements, and (3) the existence of the requisite foundational facts for admission under any exception to the hearsay rule. 97 The government forthrightly conceded at trial that, without the ledger entries, it could not prove that Ordonez and German Hernandez-Garcia were guilty of possession of cocaine for distribution as charged in Counts 7 and 11. We agree. Because the ledger entries were inadmissible as proof that appellants possessed cocaine for distribution, we must reverse Counts 7 and 11. There was no legally admissible evidence of their guilt of these crimes.
98 We are also compelled to reverse Count 14, which charged Ordonez with occupying the position of an organizer, supervisor or manager of a continuing criminal enterprise in violation of 21 U.S.C. Sec. 848. A person is engaged in a continuing criminal enterprise if he (1) commits a felony as defined in subchapter I or II of Chapter 13 of Title 21, and (2) such violation is part of a continuing series of violations. 21 U.S.C. Sec. 848(b)(1) and (2). The term series as used in Sec. 848 refers to three or more federal narcotics law violations. United States v. Valenzuela, 596 F.2d 1361, 1367 (9th Cir.), cert. denied, 444 U.S. 865, 100 S.Ct. 136, 62 L.Ed.2d 88 (1979). At least two of the three narcotics law violations required to prove a violation of Sec. 848--Counts 7 and 11--were based on the expert's interpretation of the ledger entries. As discussed above, this evidence was inadmissible under the Confrontation Clause when offered to prove the truth of matter asserted. No other legally sufficient evidence was offered that Ordonez had committed a series of narcotics law violations. That portion of the judgment which is dependent on proof of a violation of section 848 cannot stand.
99 The government relied heavily on the expert's interpretation of the ledger entries to prove that Ordonez and German Hernandez-Garcia were guilty of conspiracy. Lyons testified that it was his opinion that these records document the distribution of cocaine in very large quantities from late in 1980 and continuing on through September of 1981. They also document the movement of money that was paid for the cocaine. They also document some of the expenses incurred by the organization, and they document the payments made to members of the organizations. 100 In closing argument, the government fully exploited the evidence based on the ledger entries. The prosecutor told the jury we have additional substantial evidence that there was a conspiracy, there was an organization, and those are the ledgers that you've heard so much about. 101 For the reasons set forth above, the ledger entries were not admissible to prove the existence of a conspiracy. The use of this evidence to prove the truth of the statements contained in the ledger violated the Confrontation Clause. Where there is a reasonable possibility that the admission of evidence in violation of the Confrontation Clause might have contributed to a conviction, the government has the burden of persuading an appellate court beyond a reasonable doubt that such error was harmless. Schneble v. Florida, 405 U.S. 427, 432, 92 S.Ct. 1056, 1059, 31 L.Ed.2d 340 (1972); United States v. Valle-Valdez, 554 F.2d 911, 915 (9th Cir.1977). The ledger entries were characterized by the government's expert witness as the business records of a highly sophisticated international organization engaged in the distribution of cocaine. It is clear that this evidence, if true and admissible, conclusively proved the existence of a conspiracy. It was, therefore, highly prejudicial to the accused. It is possible that the evidence may have been sufficient to convince the jury of the existence of a conspiracy had the ledger entries not been admitted. We cannot say, however, that we are convinced beyond a reasonable doubt that the court's error in admitting the ledger entries was harmless. The prosecutor urged the jury to consider the statements in the entries as substantial evidence that a conspiracy existed. If the jury was persuaded by the government's argument concerning the weight they should give to the ledger entries, then it is very likely that this evidence contributed to the jury's finding that Ordonez and German Hernandez-Garcia were guilty of conspiracy. 102 Ordonez and German Hernandez-Garcia were entitled to a trial free from the improper admission of highly prejudicial evidence. It is evident to us from our independent review of this record that the admission of the ledger entries was not harmless error.
103 German Hernandez-Garcia and Ordonez were convicted of Count 2, which charged them with possession with intent to distribute 8.8 pounds of cocaine seized during the October 30, 1982, search of the Palm Street residence. Ordonez was arrested elsewhere. The evidence disclosed that German Hernandez-Garcia did not live at the Palm Street house. In fact, the government argued successfully before the district court that German Hernandez-Garcia and Ordonez lacked standing to challenge the search of the Palm Street residence. 104 As Hernandez-Garcia approached the house during the search he was pulled inside by one of the officers conducting the search. Thus, there was no evidence that Hernandez-Garcia and Ordonez had actual or constructive possession of the cocaine found during the search. They were convicted of Count 2 under a conspiracy theory. A member of the conspiracy can be convicted of any substantive crime committed by a co-conspirator during the course and in furtherance of a conspiracy. Pinkerton v. United States, 328 U.S. 640, 645-48, 66 S.Ct. 1180, 1183-85, 90 L.Ed. 1489 (1946). We have determined that the conviction of each appellant for conspiracy must be reversed, because prejudicial error was committed by the court in admitting evidence in violation of the Confrontation Clause. We must reverse Count 2 for the same reason. The convictions of appellants under Count 2 were also obtained through prejudicial exploitation of constitutional error.