United States v. Carl D. Ellis, (d.c.crim.no. 95-Cr-00435-4). United States of America v. Ester L. Carter Ester Carter, (d.c.crim.no. 95-Cr-00435-5)

Citations: 156 F.3d 493; 1998 WL 640967Docket: 97-1368

Court: Court of Appeals for the Third Circuit; September 21, 1998; Federal Appellate Court

SummaryOriginalCytator Case TreatmentBackward CitatorAnalysis

EnglishEspañolSimplified EnglishEspañol Fácil

Ester L. Carter appeals his conviction for conspiracy to launder drug trafficking proceeds and two counts of money laundering under 18 U.S.C. §§ 1956(h) and 1956(a)(3)(b), resulting from a government undercover operation led by IRS Special Agent Louis Oubre. The appeal primarily challenges the district court's admission of statements made by Carter's attorney, Angela Nolan-Cooper, as coconspirator statements under Fed. R. Evid. 801(d)(2)(E). The statements were recorded during meetings where Nolan-Cooper discussed laundering drug proceeds through investments in a recording studio, specifically mentioning a client who had faced financial losses but found a way to legitimize his income. Carter does not dispute that the statements pertained to him. Additionally, Carter contests the district court's refusal to give his proposed jury instruction on money laundering and limitations on his cross-examination of Agent Oubre. The appellate court finds all challenges meritless and affirms the conviction.

Prior to the indictment, a money laundering operation involving Nolan-Cooper and Carter was established, utilizing Carter's recording studio to launder proceeds from illegal gambling activities. The studio later served as a false address for a sham corporation created by Nolan-Cooper to launder purported drug proceeds, with Carter and Agent Oubre signing a backdated lease and Carter receiving rent payments, despite Oubre never using the space. Under Federal Rule of Evidence 801(d)(2)(E), out-of-court statements made by a coconspirator can be admitted as non-hearsay if the court finds: 1) a conspiracy existed; 2) the declarant and the party against whom the statement is offered were members of the conspiracy; 3) the statement was made during the conspiracy; and 4) the statement was made in furtherance of the conspiracy. The district court found that statements made during the conspiracy to launder illegal transactions were admissible, and this finding was not clearly erroneous. Carter contended that there were two separate conspiracies—one for laundering video poker money and another for drug proceeds—and argued that the district court erred in admitting statements related to a conspiracy he was not charged with. However, the law allows for the admission of statements even if the defendant is not charged with the specific conspiracy, provided the McGlory requirements are met. Thus, Nolan-Cooper's statements are considered non-hearsay regardless of the conspiracy charged in the indictment.

Nonhearsay statements are admissible in court only if relevant, and statements from an uncharged conspiracy may be excluded under Article IV of the Federal Rules of Evidence. Rule 402 protects against the admission of statements irrelevant to the conspiracy that underlies the liability. Some courts require that coconspirator statements must be 'factually intertwined' with the offenses being tried, a standard considered a restatement of relevancy principles. If the challenged statements relate to the crimes charged, they are properly admitted.

In a related issue, the appeal involved the cross-examination of Agent Oubre, who authenticated tape recordings of conversations with alleged co-conspirators. The defendants sought to question Oubre about a prior finding of false testimony regarding potential government misconduct, arguing that it demonstrated bias. The district court disallowed this line of questioning, ruling it exceeded the scope of direct examination and posed a risk of unfair prejudice. The decision was reviewed for abuse of discretion and found none, as the proposed cross-examination did not pertain to the credibility of Oubre, whose testimony was limited to the authenticity of the recordings—an aspect that Carter had already stipulated to before trial. Thus, Oubre's credibility was not at issue.

The district court ruled that questioning Agent Oubre about potential bias was inadmissible under Fed. R. Evid. 403, as the probative value was outweighed by the risk of unfair prejudice and jury confusion. Oubre's role was limited to authenticating recordings, and since Carter had already stipulated to their authenticity, any inquiries into bias were deemed to have minimal evidentiary value. The court determined that such cross-examination would likely inflame the jury and result in significant prejudice, thus justifying the prohibition on questioning. The district court's decision was affirmed, with Judge Gerald W. Heaney presiding. Carter received a 48-month prison sentence, a $30,000 fine, and three years of supervised release. The court maintained jurisdiction under 28 U.S.C. 1291 and 18 U.S.C. 3231. The court rejected Carter's referenced cases, noting they were based on outdated common law evidence principles that do not apply under current rules. Even if admitting certain statements was erroneous, it was considered a harmless error since overwhelming evidence supported Carter’s guilt, including recordings of his own conversations. The court concluded that it was highly probable the errors did not influence the conviction. Further examination of Agent Oubre's conduct can be found in U.S. v. Nolan-Cooper, 155 F.3d 221 (3d Cir. 1998).

Carter's argument for a fair trial was based on the district court's refusal to provide a jury instruction he requested concerning the 'intent to conceal' element of the money laundering charge. The court's responsibility is to present clear legal criteria to the jury, but the specific language used is at the district court's discretion, reviewed only for abuse of discretion. A jury instruction is not reversible error if it adequately presents the case without confusion. A defendant is not entitled to a specific instruction of their choosing. Carter's defense was that his dealings with Agent Oubre were sufficiently open to negate the intent to conceal the source of alleged drug money, leading him to request an instruction emphasizing the government's burden of proof. The district court deemed Carter's proposed instruction redundant and issued the government's version instead, which appropriately outlined the government's burden and the necessary intent. This instruction sufficiently articulated the relevant legal criteria, thus the court's decision not to include Carter's requested instruction did not constitute an abuse of discretion.