FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 09-30173
Plaintiff-Appellee, D.C. No.
v. 1:07-cr-00128-
LAMAR WEBSTER, RFC-1
Defendant-Appellant.
OPINION
Appeal from the United States District Court
for the District of Montana
Richard F. Cebull, Chief District Judge, Presiding
Argued and Submitted
June 9, 2010—Portland, Oregon
Filed September 30, 2010
Before: Cynthia Holcomb Hall, David R. Thompson and
M. Margaret McKeown, Circuit Judges.
Opinion by Judge Thompson
16627
16630 UNITED STATES v. WEBSTER
COUNSEL
Larry Jent, Bozeman, Montana, for the appellant.
Leif M. Johnson, Assistant United States Attorney, Billings,
Montana, for the appellee.
OPINION
THOMPSON: Senior Circuit Judge:
Lamar Webster was convicted of (1) conspiracy to possess
with intent to distribute methamphetamine, 21 U.S.C. § 846,
UNITED STATES v. WEBSTER 16631
(2) possession with intent to distribute over 500 grams of
methamphetamine, 21 U.S.C. § 841(a)(1); 18 U.S.C. § 2, (3)
money laundering conspiracy, 18 U.S.C. §§ 2, 1956(h), and
(4) money laundering, 18 U.S.C. § 1956(a)(1)(A)(I).
We have jurisdiction under 28 U.S.C. § 1291, and we
affirm.
BACKGROUND
An investigation into methamphetamine dealing in Billings,
Montana, began in December 2004. Undercover officer Mike
Gilluly of the Billings Police Department developed a rela-
tionship with an informant who made several controlled buys
from Richard Todd. In May 2005, Gilluly purchased three
ounces of crystal methamphetamine directly from Todd, who
was arrested and charged with drug crimes. Additional infor-
mation led to four more arrests. The five defendants pleaded
guilty and agreed to cooperate with law enforcement.
In December 2008, Lamar Webster was tried on four
counts related to the methamphetamine dealing: (1) conspir-
acy to possess with intent to distribute methamphetamine, 21
U.S.C. § 846, (2) possession with intent to distribute over 500
grams of methamphetamine, 21 U.S.C. § 841(a)(1); 18 U.S.C.
§ 2, (3) money laundering conspiracy, 18 U.S.C. §§ 2,
1956(h), and (4) money laundering, 18 U.S.C.
§ 1956(a)(1)(A)(I).
The four-day jury trial included testimony by Mike Gilluly,
Richard Todd, and several of Todd’s co-conspirators. The
prosecution sought admission of a proposed exhibit contain-
ing the crystal methamphetamine purchased by Gilluly. The
district court denied that motion. However, several wire trans-
fers were admitted without objection.
The district court instructed the jury on the four counts.
Notably, the instructions for Webster’s money laundering and
16632 UNITED STATES v. WEBSTER
money laundering conspiracy counts referred to the “pro-
ceeds” of unlawful activities. For example, one element of the
money laundering charge required proof “the defendant knew
that the property represented the proceeds of the illegal distri-
bution of methamphetamine.” The district court did not define
“proceeds.” The jury returned guilty verdicts on all four
counts.
On appeal, Webster challenges the admission of the testi-
mony concerning the proposed methamphetamine exhibit, and
the admission of a business record of a $300 wire transfer
identifying Webster as the recipient. In addition, Webster
filed a letter in this appeal pursuant to Federal Rule of Appel-
late Procedure 28(j) challenging the district court’s failure to
define “proceeds” in the jury instructions. Webster also con-
tends we should reverse all counts for insufficiency of the evi-
dence.
I. Testimony Concerning Proposed Methamphetamine
Exhibit
At Webster’s trial, the prosecution proposed Exhibit 7,
which Officer Gilluly identified as including some of the
crystal methamphetamine he bought from Todd, as well as
two other samples generated from the original by the crime
lab. The government then sought to move the samples into
evidence. At sidebar, the attorneys discussed whether the
sample could be directly connected to Webster, in light of
Webster’s apparent withdrawal from the conspiracy by 2005.
The government attorney conceded, “I’m not going to argue
that it’s his,” and the court reserved ruling on the admissibil-
ity of the exhibit. On cross-examination, Gilluly admitted he
“never met Mr. Webster.”
The government also asked Richard Todd about the pro-
posed exhibit. Todd explained he sold “crystal meth” to Gil-
luly, which is “the type of methamphetamine that [Todd] had
received from Lamar Webster in 2003 and 2004.” Todd then
UNITED STATES v. WEBSTER 16633
compared two packets in the proposed exhibit. He identified
the crystal meth he sold to Gilluly and explained that it was
more pure than a powdery sample.
The government then stated in open court: “Your Honor,
understanding that it’s not methamphetamine that is directly
attributable to this defendant, for demonstrative purposes, for
illustrative purposes, we move 7.” The defense objected and
the court sustained the objection. The testimony pertaining to
the exhibit was not stricken.
[1] Webster argues that the probative value of that testi-
mony was substantially outweighed by the danger of its unfair
prejudice, requiring exclusion under Federal Rule of Evidence
403. We disagree. The district court did not abuse its discre-
tion by refusing to strike the testimony pertaining to the pro-
posed exhibit. See United States v. Tran, 568 F.3d 1156, 1162
(9th Cir. 2009) (describing the standard of review for eviden-
tiary rulings). The proposed exhibit was never shown to the
jury and was excluded from evidence. The jury was informed
that the drugs mentioned in the exhibit were not connected to
Webster. The line of questioning pertaining to the exhibit was
directed at educating the jury about the various forms of
methamphetamine and not at making a connection between
the drugs mentioned in the exhibit and Webster.
II. Wire Transfer
The record keeper of Western Union testified on behalf of
the prosecution. During this testimony, the prosecution moved
for the admission of two exhibits related to a wire transfer
allegedly received by Webster. The district court admitted the
exhibits concurrently without objection.
Exhibit 14A is Western Union’s record of a $300 wire
transfer sent on December 22, 2003, from “Kelly Mayes” in
Billings, Montana. The money was received in Hayward, Cal-
ifornia, on December 23, 2003. The record also includes the
16634 UNITED STATES v. WEBSTER
recipient’s name, “Lamar Webster,” as provided by the
sender. Western Union did not require the actual recipient to
show identification.
Exhibit 14B is a $300 Western Union check payable to
“Lamar Webster” issued on December 23, 2003, and cashed
at the same Hayward store. The check also identifies Billings,
Montana, as the check’s place of origin. The check is signed
by “Lamar Webster” as payee.
Both Kelly Mayes and Richard Todd testified they sent the
wire transfer to Webster. Richard Todd testified he sent the
wire transfer to Webster on or about December 23, 2003, in
response to Webster’s request. Kelly Mayes, Todd’s then-
wife, testified that she wired Webster $300 on one occasion
per Todd’s request.
On appeal, Webster contends that the recipient’s name,
“Lamar Webster,” is an out-of-court statement by the sender
and is inadmissible hearsay within hearsay. He concedes,
however, that the remainder of Exhibit 14A is admissible
under the “business records exception” to the hearsay rule, see
Fed. R. Evid. 803. Because Webster did not object to the
admission of the exhibit into evidence, plain error review
applies. United States v. Vences, 169 F.3d 611, 613 (9th Cir.
1999).
[2] The recipient’s name is admissible under Federal Rule
of Evidence 801(d)(2)(E) as an admission by a party-
opponent—a co-conspirator statement made in the course and
furtherance of the conspiracy. Testimony established that the
senders of the wire transfer were Webster’s co-conspirators
and the wire transfer was relevant to the conspiracy. See infra
Part IV. However, even if the admission of the recipient’s
name was error, the error was harmless in light of corroborat-
ing evidence that Webster was the recipient. In particular,
Exhibit 14B, the Western Union check payable to “Lamar
Webster,” involved the same amount, issued from the same
UNITED STATES v. WEBSTER 16635
place of origin, and was cashed at the same store on the same
date. Furthermore, the payee’s signature on that check was
comparable to Webster’s signature on his driver’s license—an
exhibit also admitted into evidence.
III. Jury Instructions for Counts (3) and (4)—Money
Laundering Conspiracy and Money Laundering
In instructing the jury on the money laundering counts, the
district court did not define “proceeds” as “profits,” a failing
which Webster now challenges for the first time. Because
Webster did not raise a timely objection to the instructions,
we review for plain error. United States v. Moreland, No. 05-
30541, slip op. at 14318 (9th Cir. Sept. 17, 2010).
Webster contends our decision in Moreland compels the
conclusion that the district court’s failure to define “proceeds”
as “profits” in the jury instructions constitutes plain error. See
Moreland, slip op. at 14319-320 (discussing and applying
United States v. Santos, 553 U.S. 507, 128 S. Ct. 2020
(2008)). We disagree.
[3] In United States v. Santos, defendant Santos was con-
victed of gambling and money laundering crimes. 128 S. Ct.
at 2023. The Court addressed the question whether “pro-
ceeds,” left undefined in the definition of money laundering
in 18 U.S.C. § 1956, is defined as “profits” or “receipts” (also
called “gross receipts”).1 After concluding that no definition
predominated, a plurality determined the rule of lenity
required the narrower “profits” definition be adopted. Id. at
2024 (Scalia, J., joined by Souter, Thomas, & Ginsburg, J.J.,
1
One month after the district court entered judgment in this case, Con-
gress amended 18 U.S.C. § 1956 to define “proceeds” as “any property
derived from or obtained or retained, directly or indirectly, through some
form of unlawful activity, including the gross receipts of such activity.”
18 U.S.C. § 1956(c)(9). Because the amended definition matches the
applicable definition of “proceeds” in this case, we need not consider the
effect of the intervening amendment.
16636 UNITED STATES v. WEBSTER
and announcing the judgment of the Court). The plurality
went on to note that if the “receipts” definition were adopted
instead, a “merger problem” would arise, as “nearly every
violation of the illegal-lottery statute would also be a violation
of the money-laundering statute, because paying a winning
bettor is a transaction involving receipts that the defendant
intends to promote the carrying on of the lottery.” Id. at 2026.
Compare id. at 2035-36 (Alito, J., dissenting, joined by Rob-
erts, C.J., Kennedy & Breyer, J.J.) (determining that “pro-
ceeds” “means ‘the total amount brought in,’ the primary
dictionary definition” and relying on “what the term ‘pro-
ceeds’ customarily means in . . . a money laundering statute”);
id. at 2032-33 (Stevens, J., concurring in the judgment) (con-
sidering both the “merger problem” and legislative history
and concluding the Court need not pick a single definition of
“proceeds”).
[4] In United States v. Van Alstyne, we observed that “the
desire to avoid a ‘merger problem’ united the five [J]ustices
who held that Santos’ payments to winners . . . did not consti-
tute money laundering. . . . We therefore view the holding that
commanded five votes in Santos as being that ‘proceeds’
means ‘profits’ where viewing ‘proceeds’ as ‘receipts’ would
present a ‘merger’ problem of the kind that troubled the plu-
rality and concurrence in Santos.” 584 F.3d 803, 809, 814 (9th
Cir. 2009). See also Moreland, slip op. at 14319 (determining
payments of commissions in a fraudulent pyramid scheme
“raise the same merger problem condemned in Santos and
Van Alstyne, as commissions were central to carrying out the
scheme’s objective of encouraging further investment”).
[5] In addition to the money laundering crimes, Webster
was charged with conspiracy to possess with intent to distrib-
ute methamphetamine, 21 U.S.C. § 846, and possession with
intent to distribute over 500 grams of methamphetamine, 21
U.S.C. § 841(a)(1); 18 U.S.C. § 2. These drug crimes do not
merge with the money laundering crimes, because the drug
crimes need not involve the exchange of money. See, e.g.,
UNITED STATES v. WEBSTER 16637
United States v. Ramirez, 608 F.2d 1261, 1264 (9th Cir. 1979)
(affirming a conviction for distribution of cocaine under 21
U.S.C. § 841(a)(1) where the defendant shared the drug with
others, but “apparently no commercial scheme [wa]s
involved”). Because neither the conspiracy nor the drug pos-
session count against Webster presents a merger problem, nei-
ther requires narrowly defining “proceeds” as “profits” for the
money laundering counts.
[6] We recognize that four Justices in the Santos plurality
stated that the merger problem might exist for certain pay-
ments among conspirators. See 128 S. Ct. at 2026-27 (Scalia,
J., joined by Souter, Thomas, & Ginsburg, J.J.) (stating, “any
wealth-acquiring crime with multiple participants would
become money laundering when the initial recipient of the
wealth gives his confederates their shares”). However, this
minority view is not controlling. Moreover, five Justices in
Santos expressly agreed that “the legislative history of § 1956
makes it clear that Congress intended the term ‘proceeds’ to
include gross revenues from the sale of contraband and the
operation of organized crime syndicates involving such
sales.” Id. at 2032 (Stevens, J., concurring in the judgment);
see id. at 2035 & n.1 (Alito, J., dissenting).
We, therefore, read Santos as holding that where, as here,
a money laundering count is based on transfers among co-
conspirators of money from the sale of drugs, “proceeds”
includes all “receipts” from such sales. See Klamath Siskiyou
Wildlands Ctr. v. U.S. Bureau of Land Mgmt., 589 F.3d 1027,
1034 (9th Cir. 2009) (explaining that, when the Supreme
Court issues “no majority opinion and the plurality takes a
legal position more far-reaching than the position of a concur-
ring [J]ustice or [J]ustices[,] . . . the narrowest view that com-
mands a majority of [J]ustices is the law” (citing Marks v.
United States, 430 U.S. 188, 193 (1977))). Because the broad
“receipts” definition of “proceeds” was permissible, the dis-
trict court did not err in its jury instructions by failing to
define “proceeds” narrowly to mean “profits.”
16638 UNITED STATES v. WEBSTER
IV. Sufficiency of the Evidence
We review de novo claims of insufficiency of the evidence.
See United States v. Mincoff, 574 F.3d 1186, 1191-92 (9th
Cir. 2009). Evidence is sufficient if, when viewed “ ‘in the
light most favorable to the prosecution, any rational trier of
fact could have found the essential elements of the crime
beyond a reasonable doubt.’ ” Id. (quoting, with alterations,
United States v. Dearing, 504 F.3d 897, 900 (9th Cir. 2007)).
Count (1): Conspiracy to Possess with Intent to
Distribute Methamphetamine
Webster contends that his conviction under count (1) was
wrongfully based on proof of a mere agreement to sell
methamphetamine, in violation of United States v. Lennick,
18 F.3d 814, 819 n.4 (9th Cir. 1994) (holding that a sale of
drugs does not establish a conspiracy; rather, “the government
must show that the buyer and seller had an agreement to fur-
ther distribute the drug in question”). Webster also argues the
government failed to prove that he intended to commit the
underlying offense.
The government points to testimonial evidence showing
that Webster was aware of the drug distribution and benefitted
from the distribution. Todd and Webster discussed Todd’s
“plan” to set up sales operations in Billings, Montana. In addi-
tion, Todd allegedly had a “little kickback relationship” with
Webster. Todd explained that, as sales grew, Todd told Web-
ster: “You know, I appreciate what you’re doing for me. I’m
going to go ahead, and I’m going to give you a couple hun-
dred bucks.” Also, Webster allegedly “pitched in” a free extra
half-pound of methamphetamine upon Todd’s promises to
“double [Webster’s] money.”
Todd also suggested that Webster personally assisted the
downstream distribution. Todd testified that Webster was
present when tires were packed with methamphetamine. Web-
UNITED STATES v. WEBSTER 16639
ster allegedly drove with Todd from California to Billings,
where they removed the spare tire from Todd’s father’s truck
and delivered the tire to a recipient.
[7] A reasonable trier of fact could have found Webster
guilty of count (1). The testimony and the quantities of drugs
sold (up to two pounds at a time) suggest that Webster was
aware of the buyer’s resale activities, and, thus, implicitly
agreed to further distribution of the methamphetamine. Fur-
thermore, Webster financially benefitted from that distribu-
tion. The jury was entitled to find that Webster had the
required intent.
Count (2): Possession with Intent to Distribute Over 500
Grams of Methamphetamine
For count (2), the prosecution was required to prove that
Webster knowingly possessed methamphetamine on or about
December 22, 2003, in Billings, Montana, with intent to dis-
tribute it. The government argues that Webster is guilty under
count (2) either as a co-conspirator under Pinkerton v. United
States, 328 U.S. 640, 645-47 (1946), or as an aider and abet-
ter. See United States v. Tran, 568 F.3d 1156, 1167 (9th Cir.
2009) (explaining the legal theories that can support a convic-
tion for possession with intent to distribute).
Webster is guilty under Pinkerton co-conspirator liability if
Webster joined the conspiracy by about December 22, 2003,
and a member or members of the conspiracy committed the
alleged criminal act then or thereafter. Todd testified he began
buying methamphetamine from Webster just before Thanks-
giving in 2003. Todd drove the first three-ounce package to
Billings, and after selling it, Todd proceeded, by Christmas,
to buy and then sell four ounces, and then eight ounces, from
Webster. In the last days of December, Todd bought and
received a one-pound shipment from Webster.
[8] We conclude that sufficient evidence supports Web-
ster’s conviction for count (2) based on Pinkerton co-
16640 UNITED STATES v. WEBSTER
conspirator liability. Todd testified to the existence of a
methamphetamine distribution operation. Also, the jury could
conclude that, by December 22, 2003, Webster intended to
join and did join the conspiracy. Webster’s complicity is evi-
denced by the frequency and quantities of drugs sold by him
to conspirators, the $300 wire transfer sent from conspirators
to Webster on December 22, and Todd’s testimony that, at the
time of Todd’s first purchase, he told Webster about his plan
to sell methamphetamine in Billings.
Counts (3) and (4): Money Laundering Conspiracy and
Money Laundering
“To support a conviction for money laundering under 18
U.S.C. § 1956(a)(1), the government must prove [Webster]
(1) engaged in a financial transaction which involved pro-
ceeds from specified illegal activity, (2) knew the proceeds
were from illegal activity, and (3) intended the transaction . . .
to promote the illegal activity.” United States v. Marbella, 73
F.3d 1508, 1514 (9th Cir. 1996).
The two money laundering counts are based on Webster’s
alleged receipt of the $300 wire transfer from his co-
conspirators. Webster argues there is no proof that he knew
the proceeds were from illegal activity or that he intended the
transaction to “promote” drug dealing, relying on testimony
stating that the money was wired to Webster as a “loan.”
[9] We conclude that sufficient evidence supports Web-
ster’s money laundering convictions. A sender of the wire
transfer testified that the money was “proceeds” from the drug
distribution scheme, and that, when he expressed reservations
about wiring the money, Webster assured him not to worry
about it. Indeed, all financial dealings between the senders of
the money and Webster centered on drug sales, which were
occurring regularly during this period. Thus, the jury could
rationally conclude that the “loan,” like the prior “kickback,”
UNITED STATES v. WEBSTER 16641
was intended to promote the drug distribution scheme and that
Webster knew the proceeds were from illegal activities.
AFFIRMED.