Opinion
No. 02-40069-01/02/03-SAC
November 12, 2003
FINDINGS FOR COCONSPIRATORS' STATEMENTS UNDER RULE 801(D)(2)(E) OF THE FEDERAL RULES OF EVIDENCE
As set out in Rule 801(d)(2)(E) of the Federal Rules of Evidence, a statement is not hearsay if it is made by "a coconspirator of a party during the course and in furtherance of the conspiracy." Early in this case, the defendants requested a James hearing to determine the admissibility of any statements which the government intended to offer pursuant to this rule. The court initially found that this case was best suited for admitting the hearsay evidence conditionally upon receipt of an adequate proffer from the government. After receipt of the government's proffer, the court conditionally admitted the written and oral statements identified in the government's proffer subject to proof at trial that connects up the statements to the predicate elements for admissibility under Rule 801(d)(2)(E).
The government having rested and the statements having been conditionally admitted, the court makes it findings as to whether the government laid a sufficient foundation for the admissibility of the statements offered pursuant to Rule 801(d)(2)(E). In this circuit, the trial court must determine by a preponderance of the evidence: (1) that a conspiracy existed; (2) that the declarant and the defendant were both members of the conspiracy; and (3) that the statements were made in the course of and in furtherance of the conspiracy. United States v. Sinclair, 109 F.3d 1527, 1533 (10th Cir. 1997).
Existence of and Membership in Conspiracy
A preponderance of evidence sustains a finding on this element largely based on the testimony of Kathy Hambrick and Lisa Chamberlin, both of whom were former employees with the defendants' company, Midwest Health Care Providers, Inc., had worked directly with all three defendants, were knowledgeable of the defendants' personal involvement in the business, and had participated in or had overheard conversations between the defendants on matters evidencing the conspiratorial relationship between them. From their testimony, as well as the corroborative testimony of Mark Hill, Richard Lipscomb and Diane Kennedy, the court finds that two or more persons agreed to upcode wheelchairs and seat cushions, to make false representations to Invacare's representatives about Midwest's financial condition, and to transfer proceeds from upcoding to themselves and their other business, Total Body and Fitness. There also is a preponderance of evidence that the defendants Terence Cooper, Frank Heck and Paige Heck knew at least the essential objectives of this conspiracy and knowingly and voluntarily became a part of the conspiracy by directly participating in the conspiracy and overt acts; and that the coconspirators were interdependent, that is, they were united in a common unlawful goal or purpose to defraud Medicare and Invacare and to launder the criminally-derived proceeds. The court further finds that by a preponderance of the evidence each of the declarants was also a member of the conspiracy when he or she made the statement at issue. The government has introduced a preponderance of evidence establishing most of the factual propositions set out in its detailed written proffer on each of the required elements.
Statement in the Course of and in Furtherance of Conspiracy
The court is satisfied that all of the statements conditionally admitted under 801(d)(2)(E) were made before the conspiracy's objectives had either failed or been achieved and were intended to promote the conspiratorial objectives. Based on the context provided for the different oral and written statements, the court finds that the statements were made in an effort to communicate the future plans or goals of the conspiracy, to spur or initiate action on the part of the conspiracy, to reassure members of the conspiracy's ongoing operations, to allay a member's fears, or to keep members informed of the conspiracy's activities.
Based on the above findings, the court overrules the defendants' objections to any statements conditionally admitted during trial pursuant to Rule 801(d)(2)(E).
IT IS SO ORDERED.