United States v. Upton

United States Court of Appeals
For the First Circuit

No. 05-1593

UNITED STATES OF AMERICA,

Appellee,

v.

GEORGE L. UPTON,

Defendant, Appellant.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MASSACHUSETTS

[Hon. Patti B. Saris, U.S. District Judge]

Before

Lynch, Chief Judge,

Lipez and Howard, Circuit Judges.

Richard B. Klibaner, with whom Klibaner & Sabino, was on brief
for appellant.
John-Alex Romano, Attorney, Criminal Division, United States
Department of Justice, with whom Michael J. Sullivan, United States
Attorney and William F. Bloomer, Assistant United States Attorney,
were on brief, for appellee.

March 5, 2008
 HOWARD, Circuit Judge. A jury convicted George Upton of

conspiracy to commit money laundering. In this appeal, he argues

that, by the time of his indictment, the statute of limitations

period had run on all of his conduct except for the filing of a

false tax return and the failure to file a tax return. Upton

asserts that, under governing Supreme Court precedent cabining the

government's ability to charge continuing conspiracies based on

subsequent acts of cover-up, the two tax offenses were not part of

the conspiracy. From this premise he contends both that he was

entitled to a jury instruction on the statute of limitations and

that the evidence was insufficient to convict him of conspiracy to

launder money within the applicable limitations period. He also

claims that the district court erred in admitting a hearsay

statement as an excited utterance. We affirm.1

I.

A. Background Facts

For purposes of assessing the sufficiency claim, we

recite the facts in the light most favorable to the verdict. See

United States v. Boulanger, 444 F.3d 76, 89 (1st Cir. 2006).

Upton owned Look Motors, Inc., a used car lot in Hyannis,

Massachusetts that sold automobiles and offered financing to

1
After oral argument in this case, the Supreme Court decided
Cuellar v. United States, 128 S. Ct. 1994 (2008). The case is
pertinent to the limitations issue raised and required further
consideration.

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customers who could not afford to make large down payments. In

connection with this enterprise, he had a business relationship

with Steven Queen, a lender.

On July 9, 1997, Queen traveled to Florida and removed a

large amount of cash from his parents' safe deposit box. Queen had

told several people of his plans prior to making this trip,

claiming that the money was his inheritance. Upton had heard about

Queen's trip and its purpose.

Upon returning from Florida on the evening of July 12,

1997, Queen left a suitcase containing $900,000 in cash in the

trunk of a car that was parked in the Look Motors parking lot and

went to dinner. Upton's daughter saw Queen place the suitcase in

the trunk of the car. She told Upton and his girlfriend of twenty

years, Lynn Alberico, about the suitcase. While Queen was at

dinner, Upton and Alberico removed the suitcase from the car. When

Queen returned to Look Motors and discovered that the suitcase was

missing, he accused Upton of stealing the money. Upton denied the

accusation and told Queen to leave. Distraught, Queen went to the

apartment of a friend and told her that the money he had taken from

his parents was gone.

Queen accused Upton of stealing the money on several

occasions, in public confrontations. Upton did not admit to Queen

that he had taken the money. During the fall of 1997, however,

Upton did admit to an acquaintance that he had stolen a suitcase

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with more than $900,000 in cash from Queen. In 1999, Alberico made

the same admission to her best friend.

On August 19, 1997, a month after the theft, Upton signed

a purchase and sale agreement to buy the property located at 89

Iyanough Road in Hyannis, Massachusetts for $120,000. He made a

$12,000 down payment by check; that check was returned for

insufficient funds, and Upton replaced it with $12,000 in cash.

Upton paid the $108,000 balance of the purchase price with thirteen

cashier's checks.

The cashier's checks had been acquired in several stages,

over the span of three days. Upton's brother, two friends, and a

Look Motors employee assisted Upton and Alberico. Upton provided

cash to these four people. Then, each person deposited the cash

into his or her personal bank account to purchase one or more

cashier's checks. Most of the deposits and checks were for sums

less than $10,000 and involved visits to multiple bank branches or

multiple visits to the same branch, in order to avoid federal

reporting requirements.2 The checks variously were made out to

Upton or to Alberico.

Alberico took title to the property in the name of "AU

Trust." That trust, created on the day of the closing, August 29,

1997, bears Alberico's and Upton's initials. Also on the day of

2
Pursuant to 31 U.S.C. § 5313(a) and 31 C.F.R. § 103.22, domestic
financial institutions are required to report currency transactions
involving more than $10,000 to the Internal Revenue Service.

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the closing, Alberico granted a sham mortgage on the property to

"Bostonians Trust of Florida," which did not then even exist. The

property was then rented out for $1,000 per month.

The 89 Iyanough Road property was sold on January 5,

1999, for $202,000. On January 6, the real estate attorney wrote

separate checks to Upton and Alberico for $39,850 each, and, less

than a week later, purchased bank checks made out to Upton and

Alberico for $52,948.21 each. Bank records indicate that these

checks were deposited into the accounts of Look Motors and

Alberico, respectively, in January 1999.

Upton eventually filed his 1997 federal income tax return

in July 2000, reporting a total income of $14,165. At the same

time, he also filed returns for 1994, 1995, and 1996. All of his

returns were prepared by his accountant, based on information

provided by Upton. The 1997 return was false in that it did not

disclose any portion of the $900,000 stolen from Queen, nor did it

disclose any portion of the rental income from 89 Iyanough Road for

the partial year 1997. Alberico's tax return for 1997, filed in

August 1998, also neglected to report any portion of the stolen

money or the rental income. Upton did not file a return for 1998.

Alberico filed a false return for 1998 in October 1999, again

failing to report rental income. Neither Upton nor Alberico filed

a tax return for 1999, the year in which each earned a substantial

capital gain from the sale of the property.

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 B. Procedural History

In August 2002, a grand jury indicted Upton and Alberico

for money laundering and for structuring financial transactions to

evade reporting requirements, as well as for conspiracy to engage

in such structuring. On May 12, 2004, a superseding indictment

added counts of conspiracy to commit money laundering, in violation

of 18 U.S.C. §§ 1956(a)(1)(B), (h) and 1957(a); filing a materially

false income tax return for the year 1997, in violation of 26

U.S.C. § 7206(1); and failing to file an income tax return for the

year 1999, in violation of 26 U.S.C. § 7203.

The general five-year statute of limitations, 18 U.S.C.

§ 3282, applies to prosecutions for violations of the money

laundering and structuring statutes. For reasons not material to

this appeal, the filing of the superseding indictment established

May 12, 2004 as the relevant date for statute of limitations

purposes. Prosecution for alleged crimes committed prior to May

12, 1999 was thus barred by the statute of limitations.

Accordingly, the district court dismissed the counts carried over

from the original indictment alleging money laundering, structuring

and conspiracy to engage in structuring. Upton, 339 F. Supp. 2d at

196. Upton went to trial on the remaining charges of conspiracy to

commit money laundering and the two tax violations.3

3
Upton was tried in October 2004. Alberico's motion to sever had
been granted previously; she was tried separately in July 2005.

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 During the charge conference, Upton did not request a

jury instruction on a statute of limitations defense to the

conspiracy count. The next day, however, at the completion of the

government's case in chief, he did request such an instruction.

The trial judge denied this request on the basis that Upton had

waived the request by failing to raise it at the charge conference.

At the completion of the government's case, Upton moved

unsuccessfully for judgment of acquittal on the basis that the

money laundering conspiracy charge was time-barred. After the jury

had been instructed at the close of the evidence, Upton objected to

the denial of his request for a statute of limitations instruction.

The court again ruled that Upton had waived his right to a jury

instruction on the statute of limitations because he did not raise

it at the charge conference.

The jury found Upton guilty on each of the three counts:

conspiracy to commit money laundering, filing a false tax return,

and failure to file a tax return. Following the verdict, the

district court denied Upton's renewed motion for judgment of

acquittal, United States v. Upton, 352 F. Supp. 2d 92, 100 (D.

Mass. 2005), and sentenced him to 162 months' imprisonment.

II.

Upton appeals only his conviction for conspiracy to

commit money laundering. He does not challenge his tax

convictions. As to the conspiracy conviction, he claims that the

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district court erred in not instructing the jury on the statute of

limitations; erred in denying his motion for acquittal on statute

of limitations grounds; and abused its discretion in admitting a

statement as an excited utterance.

A. Jury Instruction on Statute of Limitations

Upton contends that the district court erred by failing

to instruct the jury on the statute of limitations applicable to

the money laundering conspiracy. He argues that he has preserved

his objection to the court's failure to so instruct, and therefore

that harmless error is the appropriate standard of review. While

he acknowledges that he failed to request a written instruction at

the charge conference, Upton presses the fact that he raised his

objection after the charge conference but before the jury was

instructed, and again after the instructions were delivered to the

jury. Beyond this, he asserts that even if he has not preserved

his objection, the court's failure to give the instruction was

plainly erroneous. See United States v. Thurston, 358 F.3d 51 (1st

Cir. 2004), vacated on other grounds.

The appellant is not entitled to relief on this ground.

First, the claim of error is unpreserved. The requirements for

requesting a jury instruction are clear. Fed. R. Crim. P. 30(a)

provides as follows:

Any party may request in writing that the
court instruct the jury on the law as
specified in the request. The request must be

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 made at the close of evidence or at any time
that the court reasonably sets.

(emphasis added). Upton concedes that he did not submit in writing

a request for an instruction on the statute of limitations; indeed,

he acknowledges that he withheld the request for a jury instruction

at the charge conference as part of his trial strategy. As he did

not meet the requirements for requesting a jury instruction, his

later objections to the jury instructions were deemed waived by the

trial judge.

That brings us to the question of how to treat the

unpreserved jury instruction issue. In United States v. Muñoz-

Franco, 487 F.3d 25, 54 (1st Cir. 2007), we held that the failure

to request a jury instruction constitutes waiver. The defendants

in Muñoz-Franco claimed that the district court erred in not

instructing the jury on the applicable statute of limitations, but

they had not raised that issue at any time prior to or during

trial, including in their post-trial Rule 29(a) motion. We held

that their claim was waived and thus not reviewable on appeal.

Pointing to Thurston, Upton argues that plain error

review is appropriate in this case. 358 F.3d at 63. It is not

necessary, however, to resolve any potential conflict between

Muñoz-Franco and Thurston here. Waiver is the "intentional

relinquishment or abandonment of a known right." United States v.

Olano, 507 U.S. 725, 733 (citation omitted) (emphasis added). The

right to a jury instruction can be waived by not requesting the

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instruction, or not objecting at the proper time. Fed. R. Crim. P.

30(a), (d). Upton deliberately chose not to request a statute of

limitations jury instruction at the charge conference as a matter

of trial strategy.4 The informed decision to decline to exercise

the right to request a specific jury instruction is a

straightforward example of an "intentional relinquishment" subject

to waiver.

Even were we to consider this an instance of forfeiture

and review the failure to instruct the jury on the statute of

limitations for plain error, we would conclude that there was no

plain error. Under the plain error standard, Upton must show that

"the trial court committed an error, that the error was 'plain,'

and that the error affected the substantial rights of the

appellant." United States v. Colon-Nales, 464 F.3d 21, 25 (1st

Cir. 2006) (citing Olano, 507 U.S. at 732). Further, error is to

be corrected only if it "seriously affects the fairness, integrity

4
Upton points out that a defendant may face a difficult decision
when a charge conference is held before the close of the
government's case: raising a defense at that point might alert the
government to a weakness in its case and encourage the government
to seek additional evidence. Nevertheless, the district court is
vested with the authority to manage trials, United States v.
Saccoccia, 58 F.3d 754, 770 (1st Cir. 1995), including setting a
time for the charge conference that parties must adhere to or face
the consequences. Here, the charge conference was the day before
the government closed the evidence in its case. The timing of the
conference was entirely reasonable, and we need not explore
application of the rule to situations presenting an extreme gap in
timing between the conference and the close of the evidence.

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or public reputation of judicial proceedings." Olano, 507 U.S. at

736 (internal citation and quotation marks omitted).

The trial court did not commit plain error in declining

to instruct the jury on the statute of limitations. Rule 30(a) is

clear, and Upton failed to meet its strictures. The district judge

acted within her discretion to deny Upton's requested instruction

because the request was untimely.

B. Motion for Acquittal on Statute of Limitations

Presented as a challenge to the sufficiency of the

evidence, Upton argues that the district court should have granted

his motion for acquittal on the conspiracy count because the

statute of limitations bars his conviction. The essence of this

sufficiency claim is that there was no evidence that the conspiracy

continued to a time that was within five years of the May 12, 2004

superseding indictment. Upton argues that the money laundering

objective of the conspiracy was achieved no later than when the

conspirators sold the Iyanough Road property in January 1999. His

failure to file a return for 1999 and his July 2000 filing of a

false tax return for 1997 were, he says, at most unilateral acts

intended to cover up the conspiracy after its termination. Relying

on Grunewald v. United States, 353 U.S. 391 (1957), Upton argues

that the tax violations must be viewed as no more than attempts at

covering up a completed conspiracy. As such, under Grunewald they

cannot constitute acts in furtherance of the conspiracy.

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 The government counters that Grunewald does not bar this

prosecution. Rather, because the indictment charged a conspiracy

the main objective of which was concealment, Grunewald's limiting

principle has no applicability to this case.

1.

We review de novo the denial of a motion for judgment of

acquittal based on the insufficiency of the evidence. United

States v. Hatch, 434 F.3d 1, 4 (1st Cir. 2006). A motion for

judgment of acquittal is only granted if "the evidence and all

reasonable inferences to be drawn from the evidence, both taken in

the light most favorable to the government, are insufficient for a

rational factfinder to conclude that the prosecution has proven,

beyond a reasonable doubt, each of the elements of the offense."

United States v. Pimental, 380 F.3d 575, 583 (1st Cir. 2004).

To determine whether Upton's motion for acquittal based

on the statute of limitations should have been granted, we look

backward from the date of the superseding indictment and assess

whether the evidence, taken in the light most hospitable to the

verdict, was such that the jury could reasonably have concluded

that the conspiracy did not end until May 12, 1999 or later. See

United States v. Walsh, 928 F.2d 7, 11-12 (1st Cir. 1991). The

question boils down to whether the jury could have supportably

found that either or both of the tax offenses that Upton committed

in 2000 were part of the conspiracy, and the wrinkle is Upton's

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assertion that Grunewald requires us to view the tax violations as

acts of cover-up beyond the scope of the conspiracy.

A conspiracy endures as long as the co-conspirators

endeavor to attain the "central criminal purposes" of the

conspiracy. Grunewald, 353 U.S. at 401. In this case, the

indictment charged that Upton and Alberico conspired to violate 18

U.S.C. §§ 1956(a)(1)(B) and 1957(a). Section 1956(a)(1)(B)

prohibits engaging in financial transactions involving the proceeds

of unlawful activities:

knowing that the transaction is
designed in whole or in part–-
(i) to conceal or disguise the nature,
the location, the source, the ownership, or
the control of the proceeds of specified
unlawful activity ...

18 U.S.C. § 1956(a)(1)(B) (emphasis supplied). The focus of the

prohibition is thus trained on the design to conceal or disguise.

The concealment feature distinguishes § 1956(a)(1)(B) from §

1957(a). Section 1957(a) prohibits monetary transactions in

criminally derived property, but does not contain an element of

concealment or disguise.

The Supreme Court has recently examined language in §

1956(a)(2) that is identical to the language of the section at

issue in this case, § 1956(a)(1)(B)(i). In Cuellar, 128 S. Ct.

1994, the Court considered whether certain conduct violated §

1956(a)(2)'s proscription against "transportation" of proceeds with

knowledge that the transportation was designed to conceal or

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disguise the nature, location, source, ownership or control of the

proceeds. The Court emphasized that in the phrase "designed ... to

conceal or disguise," "'design' means purpose or plan"; i.e., the

intended aim of the transportation. 128 S. Ct. at 2003. As the

pertinent language of § 1956(a)(1)(B) is identical to that of §

1956(a)(2)(B), we conclude that Congress's use of "designed ... to

conceal or disguise" in (a)(1)(B) likewise requires the government

to prove that there was a purpose or plan to conceal or disguise.

See Gustafson v. Alloyd Co., Inc., 513 U.S. 561, 562 (1995) ("The

normal rule of statutory construction [is] that identical words

used in different parts of the same Act are intended to have the

same meaning."); see also Finnegan v. Leu, 456 U.S. 431, 438 n.9

(1982) (noting that "if Congress had intended identical language to

have substantially different meanings in different sections of the

same enactment it would have manifested its intention in some

concrete fashion.").

The conspiracy count in the indictment explicitly

invoked the concealment money laundering prohibition of 18 U.S.C.

§§ 1956(a)(1)(B), charging Upton with the intent to conceal

material characteristics of the stolen money. The indictment

alleged, as the "manner and means" of carrying out the conspiracy,

that the defendants used the stolen monies to make the multi-

layered purchase of 89 Iyanough Road in August of 1997; that Upton

commingled additional theft proceeds with business receipts of Look

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Motors on more than twenty occasions during the remainder of 1997;

that Alberico filed a false tax return for 1997 in 1998 that did

not disclose the theft income or her rental income from the

Iyanough road property; and that:

"It was part of the conspiracy that
[defendants] attempted to conceal or disguise
the nature, location, source, ownership, or
control of the illegal cash proceeds by
failing to file income tax returns, or declare
a capital gain from the sale of the commercial
property, for the tax year 1999 [and Upton
attempted to conceal or disguise] by filing a
materially false federal income tax return . .
. that failed to declare the receipt of the
illegal income or the rental income from the
property in 1997."

The indictment thus put Upton on notice, at a minimum,

that his concealment of the capital gain from the sale of 89

Iyanough Road was part and parcel of the alleged means of carrying

out the charged conspiracy.5 To sustain its burden of proof, the

government had to establish that Upton conspired to engage in

transactions with the intended aim of concealing or disguising

certain attributes of the funds involved. And to avoid the statute

of limitations bar, it also had to prove that one of the tax

offenses was in furtherance of the central objective of the

conspiracy.

5
The indictment did not expressly allege the sale of the Iyanough
Road property in January 1999 as a money laundering transaction,
but as we have noted, the indictment did allege that the
concealment of capital gain on the sale was part of the conspiracy.
In any event, Upton does not make any claim of variance and does
not contest that the sale was part of the conspiratorial object.

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 Determining the contours of the conspiracy ordinarily is

a factual matter entrusted largely to the jury. United States v.

Moran, 984 F.2d 1299, 1303 (1st Cir. 1993). Consistent with the

allegations in the indictment, the government introduced evidence

that Upton and Alberico purchased the 89 Iyanough Road property in

August 1997 and sold it in January 1999. The pair converted cash

into cashier's checks to finance the initial purchase of the

property, set up the sham mortgage, and took title in the name of

"AU Trust." Upton commingled additional theft proceeds with

business income. Alberico filed a false 1997 tax return, omitting

the theft proceeds and rental income. Neither Upton nor Alberico

filed tax returns for 1999 -- the year in which they were required

to report a capital gain on the sale.

From this evidence the jury reasonably could have found

that Upton's failure to file the 1999 return was in furtherance of

the central objective of the conspiracy. Specifically, the jury

supportably could have concluded that the failure to file his 1999

return in the ordinary course facilitated the concealment aim of

the money laundering transactions. That act of omission may have

had special significance to the jury, because in his 1999 return

Upton was required to disclose not only any rental receipts but

also the capital gain he realized on the sale of the property. The

jury may have also found it significant that Alberico, too, did not

file a return for 1999, contrary to her practice in previous years.

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The capital gains disclosures they were required to make easily

could have unraveled the entire money-laundering scheme, not only

subjecting them to prosecution, but also resulting in the

forfeiture of the proceeds. See 18 U.S.C. § 981(a). Avoiding such

an outcome, whereby their use of the proceeds would be thwarted,

was a primary goal of the concealment money laundering conspiracy,

or so the jury could have found.6

2.

In the face of this evidence, Upton argues that the

Grunewald imposes a limitation on the ability of subsequent acts of

6
The government says that Upton's filing in 2000 of a false 1997
return was also an act in furtherance of the conspiracy. It may
have been, although the act occurred more than two years after
Upton would have been expected to file a return, and almost two
years after his coconspirator Alberico similarly filed a false
return. We need not definitively resolve whether that Upton's false
filing was in furtherance of the conspiracy. The evidence of the
conspirators' parallel failures to file 1999 tax returns was
sufficient for the jury to conclude that the conspiracy lasted at
least until May 12, 1999. But that does not by any stretch render
Upton's 2000 filing irrelevant. At a minimum, the fact of the
false filing was admissible to show, and was strong evidence of,
Upton's knowledge that the 1997 purchase was designed to conceal
characteristics of the unlawful proceeds. In addition, coming as
it did in the same time frame as Upton's failure to file a tax
return for 1999, his guilty knowledge associated with the June 2000
false filing solidifies the inference that the reason for the
failure to file was in fact to prevent discovery of the money
laundering conspiracy. The 1997 returns filed by both conspirators
were false in that they did not disclose the receipt of the stolen
funds. Pointedly, they also failed to disclose the rental income
from the Iyanough Road property, further cementing the inference
that ownership of that property was part of a design to disguise or
conceal.

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concealment to extend the life of a conspiracy.7 At bottom, as we

have noted, the argument is that acts that constitute an attempt to

cover up a completed crime do not extend the duration of the

conspiracy. See Grunewald, 353 U.S. at 401 (it is not enough that

the defendants "took care to cover up their crime in order to

escape detection and punishment"). According to Upton, his failure

to file a 1999 tax return and his July 2000 filing of a false 1997

tax return were, at most, attempts to cover up completed financial

transactions, namely, the buying and selling of the Iyanough Road

property in August 1997 and January 1999. Thus, he maintains,

under Grunewald the acts of concealment represented by the two tax

offenses could not extend the life of the conspiracy. In support

of this argument, Upton cites United States v. LaSpina, 299 F.3d

165, 176 (2d Cir. 2002), for the proposition that a conspiracy with

an economic transaction as its objective lasts only until the

"anticipated economic benefits" of that transaction are received.

Id.

7
In Grunewald, decided under the general conspiracy statute, 18
U.S.C. § 371,the defendants had been charged with conspiracy in
connection with a scheme to obtain "no prosecution" rulings by
bribing an IRS official in two discrete tax cases. Based primarily
on a concern that the statute of limitations otherwise would be
open-ended, the Court concluded that later acts of cover-up did not
extend the duration of the conspiracy. Subsequently, in Forman v.
United States, the Court held a conspiracy to have continued into
the relevant limitations period, where the indictment alleged that
the conspiracy included the acts of concealment, and where the
concealment was necessary for the successful completion of the
scheme. 361 U.S. 416, 423-24 (1960).

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 If covering up a completed conspiracy to violate 18

U.S.C. § 1957(a), by engaging in monetary transactions in

criminally derived property, were all that the two tax offenses

accomplished, the argument might have merit. Here, however, as we

have noted, Upton was also charged with conspiring to violate §

1956(a)(1)(B) by engaging in financial transactions designed to

conceal or disguise certain characteristics of the proceeds of

unlawful activity. The objective of the conspiracy was more than

the specific monetary transactions of buying and selling 89

Iyanough Road. The objective was to engage in concealment money

laundering in order to obscure the illicit source of the funds and

the conspirators' continued control of the proceeds. Accordingly,

Upton's argument fails to gain traction.8

To be sure, in some cases the crime of concealment money

laundering may be completed at the time the transaction itself is

consummated. In this case, for example, there was a wealth of

evidence that the purchase of the Iyanough Road property in 1997

constituted concealment money laundering. But that the evidence

might have shown that the 1997 purchase of property constituted

concealment money laundering does not mean that the conspiracy to

8
Upton's citation to LaSpina is inapposite. The conspiracy in
LaSpina differed materially from the conspiracy in this case.
LaSpina involved a conspiracy whose purpose was to engage in
monetary transactions in criminally derived property, in violation
of 18 U.S.C. § 1957(a). The reasoning in LaSpina thus applies to
conspiracies without an element of concealment.

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commit concealment money laundering ceased at that time or, for

that matter, with the sale of the property in 1999.9

Where, as we have established is the case here, the

substantive crime that is the object of the conspiracy has the

intent to conceal as an element, the success of the conspiracy

itself may depend on further concealment. Consequently, additional

acts of concealment that facilitate the central aim of the

conspiracy are in furtherance of the conspiracy. See, e.g., United

States v. Goldberg, 105 F.3d 770, 774 (1997) (acts of tax evasion

were "integral and self-evident part of" fraud conspiracy charged

under 18 U.S.C. § 371); United States v. Mann, 161 F.3d 840, 859

(5th Cir. 1998) (acts designed to frustrate regulatory oversight

were "central" to conspiracy involving fraud within savings and

loan institution); United States v. Esacove, 943 F.2d 3, 5 (5th

Cir. 1991) (acts designed to protect money laundering conspiracy

against government investigation held "necessary" part of

conspiracy). And, as noted above, the jury was entitled to infer

that the conspirators' parallel failures to file tax returns for

9
In Grunewald, the court observed that subsequent acts of
concealment may well facilitate the success of the substantive
crime and thus be in furtherance of the conspiracy, as when a car
thief repaints the stolen vehicle. 353 U.S. at 405. The purpose
of concealment money laundering is to make proceeds appear
legitimate, especially to the government. Preventing the
authorities from discovering the illicit nature of the proceeds, by
concealing the existence or financial impact of the money
laundering transactions, is as much a part of the ongoing
conspiracy to launder money as repainting the car is a part of a
theft conspiracy.

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1999 were part of an ongoing plan to engage in concealment money

laundering, rather than merely being later attempts to cover up a

completed crime. See United States v. Dazey, 403 F.3d 1147, 1159

(10th Cir. 2005) ("[T]he jury may infer conspiracy from the

defendants' conduct and other circumstantial evidence indicating

coordination and concert of action.").

3.

Upton presents another argument. Even assuming that he

engaged in acts of concealment that could be considered to be in

furtherance of the main objectives of the conspiracy, no conspiracy

could have existed in this case because he and Alberico never

expressly agreed to engage in acts of concealment. The Court's

decision in Grunewald, he posits, requires that the government

present proof of defendant's express agreement to conceal. See

United States v. Twitty, 72 F.3d 228, 234 (1st Cir. 1999). The

government, Upton contends, failed to present such evidence. In

fact, Upton argues that the record evidence actually supports his

contention that no such express agreement existed and that, as a

result, any acts of concealment were undertaken unilaterally. This

is because the record indicates that, by the summer of 1999, he and

Alberico were estranged.

Upton's argument misses the point. In Grunewald, the

Court drew a distinction between "acts of concealment done in

furtherance of the main objectives of the conspiracy," and "acts of

-21-
concealment done after these central objectives have been attained

for the purposes of covering up after the crime." 353 U.S. at 405.

Where the latter is involved, the government must present some

proof of an express original agreement to engage in the acts of

concealment. See Twitty, 72 F.3d at 234. However, nothing in the

case law imposes a requirement that conspirators expressly agree to

engage in acts of concealment where those acts are done in

furtherance of the main objectives of the conspiracy.10 Rather, the

acts of concealment committed by one co-conspirator need only have

been "foreseeable" to the other co-conspirator. See United States

v. Hansen, 434 F.3d 92, 103 (1st Cir. 2006); United States v.

Pinillos-Prieto, 419 F.3d 61, 69 (1st Cir 2005).

Here, as established above, a reasonable jury could

conclude that the acts of concealment in this case, specifically

the failure of Upton and Alberico to file 1999 tax returns, were

done in furtherance of the main objectives of the conspiracy.

And, moreover, these acts would have plainly been foreseeable to

both conspirators. Not filing returns was an "integral and

self-evident part of" the conspiracy -- had either Upton or

Alberico not hidden the proceeds of the house sale, this would have

10
In fact, cases like Mann, 161 F.3d at 859 and Davis, 623 F.2d at
192 indicate that no such requirement exists.

-22-
defeated the primary purpose of the conspiracy. Goldberg, 105 F.3d

at 774.11

4.

In his final attempt at excluding the tax offenses from

consideration, Upton suggests that his estrangement from Alberico

in the summer of 1999, alluded to above, amounted to a withdrawal

from the conspiracy. This argument is waived. See United States

v. Zannino, 895 F.2d 1, 17 (1st Cir. 1990) ("[I]ssues adverted to

in a perfunctory manner, unaccompanied by some effort at developed

argumentation, are deemed waived."). In any event, the standard

for recognizing a conspirator's withdrawal from a conspiracy is

exacting. Even were this argument not waived, Upton cannot

demonstrate his withdrawal from the conspiracy. See United States

v. Dunn, 758 F.2d 30, 38 (1st Cir. 1985) ("[A] conspirator must act

affirmatively to either defeat or disavow the purpose of the

11
Although it is unnecessary to our analysis, we note further that
a reasonable jury could have concluded that Upton and Alberico had
expressly agreed to engage in acts of concealment. Upton and
Alberico acted in tandem when they both failed to file returns in
1999. This concerted activity is circumstantial evidence that an
express agreement to conceal was in place.
Of course, Upton and Alberico did not act in complete concert
at all times. For example, in 1998 Alberico filed a false return
for 1997 omitting the stolen Queen money, whereas Upton waited
until 2000 to file a false return for 1997. But that other
evidence conceivably supports the absence of an express agreement
to conceal is not dispositive in this sufficiency of the evidence
case. See United States v. Ortiz, 447 F.3d 28, 34 (1st Cir. 2006)
("[C]ompeting inferences are not enough to disturb a jury's
verdict").

-23-
conspiracy"; mere disagreement with co-conspirators is insufficient

to constitute withdrawal.).12

C. Hearsay Evidence

Upton argues that the district court erred in admitting

as an excited utterance Queen's hearsay statement to his friend

Janet Hoell that "the money was gone" on the night of the theft of

the suitcase. Fed. R. Evid. 803(2) creates an exception to the

rule against hearsay for "[a] statement relating to a startling

event or condition made while the declarant was under the stress of

excitement caused by the event or condition." Upton contends that

because six hours elapsed between the startling event -- the

disappearance of the suitcase full of money -- and Queen's

statement to Hoell, the statement could not have been made while

Queen was "under the stress of excitement" of the loss of the

money. Fed. R. Evid. 803(2).

12
Upton does present an additional argument that merits only
summary treatment. He contends that, for statute of limitation
purposes, the indictment in this case barred consideration of his
tax crimes because it failed to: (1) allege that he and Alberico
agreed to commit those tax crimes and (2) charge him with
conspiring to commit money laundering with the intent to evade
taxes or file a false return in violation of 18 U.S.C. §
1956(a)(1)(A)(ii). "[A]n indictment is sufficient if it, first,
contains the elements of the offense charged and fairly informs a
defendant of the charge against which he must defend, and, second,
enables him to plead an acquittal or conviction in bar of future
prosecutions for the same offense." United States v. Cianci, 378
F.3d 71, 81 (1st Cir. 2004) (citation and internal quotations
omitted). A review of the indictment in this case makes plain
that the indictment's language was sufficient to put Upton on
notice of the conspiracy charge against him.

-24-
 We review the admission of evidence after an objection

for an abuse of discretion. See United States v. Garcia, 452 F.3d

36, 38 (1st Cir. 2006). We will only vacate a jury verdict if an

improperly admitted statement was not harmless -- that is, if its

admission "'likely affected the outcome of trial.'" United States

v. Castellini, 392 F.3d 35, 52 (1st Cir. 2004) (quoting United

States v. Torres-Galindo, 206 F.3d 136, 141 (1st Cir. 2000)).

If the admission of the statement was error at all, which

we needn't decide, it was harmless for two reasons. First, the

statement itself likely did little to influence the jury.

Conspiracy to commit concealment money laundering involves an

agreement to conceal the nature of proceeds that were unlawfully

obtained. Here, in order to prove the element that the proceeds

had been illegally obtained, the government had to show that Upton

stole the money that he subsequently laundered. Queen's statement

does not demonstrate that the money was even stolen, much less that

Upton was the one who stole it. While Queen's statement does

provide support for the idea that the money disappeared from the

trunk of the car during a specific time frame, it does not

implicate Upton.

Second, the government presented plenty of evidence that

Upton did in fact steal the money. Upton's friend Phidias Dantos

testified that Queen accused Upton of stealing the money shortly

after the theft occurred. More significantly, Colleen Otto

-25-
testified that Alberico told her that Alberico and Upton had taken

the money, and Edwin Jones testified that Upton revealed to him

that he had stolen the money. Look Motors's bookkeeper, Lucy Webb,

testified that Upton declined to tell her where he got the money to

purchase 89 Iyanough Road, saying that he wanted to "maintain her

innocence." And the additional evidence of Upton's money

laundering activities provided strong support for the inference

that he and Alberico had obtained a large sum of money around the

time the suitcase was stolen from Queen. If it was anything,

Queen's statement was merely icing on the cake.

Upton nevertheless contends that the admission of Queen's

statement cannot constitute harmless error. He argues that Queen's

statement bolstered the testimony of Otto and Jones, witnesses who

he says were in need of bolstering because of their dubious

credibility.13 There are two problems with this argument. First,

the bolstering complaint applies only to Otto and Jones. As we

have explained, the testimony of Otto and Jones was not the only

evidence indicating that Upton stole the money from Queen. Second,

in addition to credibility being a matter for the jury to

determine, it is doubtful that the credibility of Otto and Jones

13
Upton challenges Jones's credibility in two aspects: Jones was
serving time on drug charges and testified in return for a
reduction in his sentence; and, Jones may have been seeking revenge
against Upton because Upton tipped off the police to Jones's drug
dealing activities several years ago. Upton also challenges
Alberico's comments to Otto as potentially motivated by a desire to
incriminate Upton following their breakup.

-26-
needed bolstering from Queen's statement in any event. Their

testimony was supported by other evidence. Otto's testimony that

Alberico admitted that she and Upton took the suitcase of money to

a hotel was supported by hotel records introduced at trial

revealing that Upton rented a hotel room for two people on the

night Queen returned from Florida. Otto's further testimony that

Alberico said she had spent part of her share of the money during

a trip to Italy was corroborated by airline and credit card records

showing that Alberico was in Italy during February 1999. Jones

testified that in 1997 Upton gave him cash from a "shoebox full of

money" and that the money "looked old" and was dated from the

1950s; this description is consistent with the proposition that the

money was earned by Queen's father throughout his life and

subsequently stored in a safe deposit box.

In short, Queen's statement to Hoell is cumulative of

other evidence in the record. Regardless of whether admitting the

statement as an excited utterance may have been error, any such

error was harmless.

For the reasons expressed above, we uphold Upton's

conviction.

Affirmed.

-Dissenting Opinion Follows-

-27-
 LIPEZ, Circuit Judge, dissenting in part. The

relationship between the concealment at issue in Upton's conspiracy

to commit money laundering and the concealment associated with his

subsequent tax crimes is complex. The majority misapplies the

relevant legal principles and, consequently, wrongly concludes that

Upton's failure to file a 1999 tax return was conduct within the

scope of the money laundering conspiracy. In so doing, the

majority embraces the government's misguided attempt to remedy a

statute of limitations problem by stretching the money laundering

conspiracy beyond its justifiable limits to include Upton's

independent tax crime.

As the majority notes, the district court had dismissed

before trial, on statute of limitations grounds, counts alleging

money laundering, structuring, and conspiracy to engage in

structuring. To salvage its money laundering conspiracy charge,

the government sidestepped the Supreme Court's teaching in

Grunewald v. United States, 353 U.S. 391 (1957), which – given the

evidence presented – bars treating the tax fraud as conduct that

furthered the conspiracy. If, as Grunewald requires, Upton's tax

evasion were eliminated from the scope of the conspiracy, no act in

furtherance of the money laundering scheme would fall within the

five-year statute of limitations period – and the jury's guilty

verdict on the conspiracy count could not stand. Because the

-28-
majority's decision to uphold the verdict conflicts with the

governing precedent, I respectfully dissent.14

I.

In Grunewald, the Supreme Court drew a distinction

between acts of concealment that furthered a charged conspiracy and

subsequent acts of concealment done "for the purpose only of

covering up after the crime." Id. at 405. If the acts at issue

were of the latter type – i.e., they did not further "the main

criminal objectives of the conspiracy" – the concealment would not

extend the duration of the conspiracy for purposes of the statute

of limitations. Id.; see also United States v. Twitty, 72 F.3d

228, 233 (1st Cir. 1995).

That distinction, the Court explained, was governed by

"important considerations of policy" that hearkened back to prior

cases "repeatedly warn[ing] that we will view with disfavor

attempts to broaden the already pervasive and wide-sweeping nets of

conspiracy prosecutions." Grunewald, 353 U.S. at 404. Routinely

viewing concealment efforts as part of a conspiracy would "wipe out

the statute of limitations in conspiracy cases" and "result in a

great widening of the scope of conspiracy prosecutions" because

"every conspiracy will inevitably be followed by actions taken to

14
My objections to the majority's reasoning also apply to its
decision in the separate appeal of Upton's co-defendant, Alberico,
who also challenged her conviction for conspiracy to commit money
laundering on statute of limitations grounds.

-29-
cover the conspirators' traces." Grunewald, 353 U.S. at 402.

Hence, the Court rejected "the proposition that the duration of a

conspiracy can be indefinitely lengthened merely because the

conspiracy is kept a secret, and merely because the conspirators

take steps to bury their traces, in order to avoid detection and

punishment after the central criminal purpose has been

accomplished." Id. at 405.

Thus, if Upton's tax evasion were conduct designed to

cover up the money laundering conspiracy after the crime had been

accomplished, rather than conduct undertaken to further the

conspiracy's central criminal purpose – laundering the stolen money

– the money laundering conspiracy charge would be time-barred. Two

possible theories, however, could support a conclusion that the

failure to file a 1999 tax return furthered the charged conspiracy

for purposes of the statute of limitations. First, if the evidence

showed that the conspiracy embraced "an express original agreement

among the conspirators to continue to act in concert in order to

cover up" the crime, those acts of concealment could "properly be

regarded as in furtherance of the conspiracy." Id. at 404, 397.

In such instances, the cover-up would be not only foreseeable – as

it would be with all crimes – but the explicit objective of "a

subsidiary conspiracy to conceal." Id. at 402.

Second, the tax fraud would be within the scope of the

money laundering conspiracy if it could be viewed as an act of

-30-
concealment done in furtherance of the main criminal objective of

the conspiracy. In Grunewald, the defendants had fraudulently

obtained "no prosecution" rulings from the Bureau of Internal

Revenue on behalf of two companies seeking to avoid tax evasion

charges, and the defendants later took steps to conceal their

fraudulent activity. Id. at 395-96. The Supreme Court observed

that the "no prosecution" rulings obtained in 1948 and 1949 had

been the main objective of the conspiracy presented to the jury,

and the subsequent efforts to conceal the irregularities – the

conduct occurring within the statute of limitations period – could

only have been for the purpose of avoiding apprehension, rather

than to further the conspiracy's already completed objective. Id.

at 405-06. The Court acknowledged, however, that some acts of

concealment are so closely linked in time and purpose to the

accomplishment of the conspiracy that they are "in furtherance of

the objectives of the conspiracy itself." Id. at 405. The Court

cited the concealment of kidnappers who hide while awaiting ransom

and the repainting of a stolen car as instances in which "the

successful accomplishment of the crime necessitates concealment."

Id.

The majority premises its analysis primarily on the

second theory, concluding that "[n]ot filing returns was an

'integral and self-evident part of' the conspiracy," but it asserts

in a footnote that a reasonable jury could have concluded as well

-31-
that Upton and Alberico had expressly agreed to engage in acts of

concealment. I therefore consider both theories, looking first at

the possibility of an express agreement to conceal.

II.

In asserting that the conspiracy in this case embraced

the acts of concealment in the aftermath of the money laundering

transactions, the majority emphasizes that, pursuant to the money

laundering statute, the indictment charged Upton with conspiring

"to conceal or disguise," inter alia, the source and control of the

stolen $900,000. See 18 U.S.C. § 1956(a)(1)(B).15 The majority

concludes that, because of this concealment language, "[t]he

objective of the conspiracy was more than the specific monetary

transactions of buying and selling 89 Iyanough Road," but included

the purpose "to obscure the illicit source of the funds and the

conspirators' continued control of the proceeds." It reasons that,

because the money laundering crime that was the objective of the

15
That provision states, in relevant part:

(a)(1) Whoever, knowing that the property involved in a
financial transaction represents the proceeds of some
form of unlawful activity, conducts . . . such a
financial transaction which in fact involves the proceeds
of specified unlawful activity––
(B) knowing that the transaction is designed in
whole or in part––
(i) to conceal or disguise the nature, the location,
the source, the ownership, or the control of the proceeds
of specified unlawful activity . . . .
shall be sentenced to a fine . . . or
imprisonment . . . .

-32-
conspiracy included a concealment element, the tax fraud was within

the conspiracy's scope.

The concealment element in the money laundering statute

does not, however, bring within the scope of the money laundering

conspiracy all conduct undertaken by the defendants to conceal the

theft of the $900,000. The concealment element of section

1956(a)(1)(B) goes to the defendant's state-of-mind when engaging

in the prohibited transactions. The statute makes unlawful the

conduct of a financial transaction "knowing that the transaction is

designed in whole or in part . . . to conceal or disguise" the

origin or control of unlawfully obtained property. In other words,

the jury in this case had to find that Upton conspired to commit

money laundering transactions that were undertaken for the purpose

of concealing the crime from which the laundered proceeds were

derived (here, the theft of the $900,000). The statutory state-of-

mind requirement does not, however, transform subsequent acts of

concealment that do not involve financial transactions – whether

designed to hide the money laundering activity or, like the money

laundering itself, to hide the original theft – into conduct that

is within the money laundering conspiracy.

Under Grunewald, efforts to conceal the money laundering

conspiracy after the conspiracy's primary aim (the deceptive

financial transactions) has been achieved may be included within

the scope of the conspiracy only if the evidence permits the jury

-33-
to find that the defendants' "original agreement" explicitly

included a subsidiary objective to cover up their crime. See

Grunewald, 353 U.S. at 404 (emphasis added). In other words, there

must be some evidence of an agreement between the defendants,

entered into before they commit the crime that is the object of the

conspiracy, to continue to act jointly to cover up their unlawful

activity. Only where there is such a pre-crime agreement will acts

of covering up after the crime reveal "more than that the

conspirators do not wish to be apprehended – a concomitant . . . of

every crime since Cain attempted to conceal the murder of Abel from

the Lord." Id. at 406.

As in Grunewald, "[t]here is not a shred of direct

evidence in this record to show anything like an express original

agreement among the conspirators to continue to act in concert in

order to cover up, for their own self-protection, traces of the

crime after its commission." Id. at 404. Nor does the fact that

both Upton and Alberico failed to file 1999 tax returns reporting

the gain earned from the stolen funds constitute indirect evidence

of such an agreement to conceal. The Supreme Court in Grunewald

unequivocally held that such post-crime evidence was insufficient

to show the required pre-crime agreement:

[A] conspiracy to conceal is being implied [by
the government] from elements which will be
present in virtually every conspiracy case,
that is, secrecy plus overt acts of
concealment. . . .

-34-
 Acts of covering up, even though done in the
context of a mutually understood need for
secrecy, cannot themselves constitute proof
that concealment of the crime after its
commission was part of the initial agreement
among the conspirators.

Id. at 404, 402; see also SEC v. Papa, No. 08-1172, Slip op. at 11-

12 (1st Cir. Feb. 6, 2009) (noting that "an agreement to conceal

after the fact could be viewed as inherent in a conspiracy or any

wrongful fraudulent scheme[,] but then all covert joint wrongdoing

would be a permanently continuing offense . . . an approach that

the Supreme Court has rejected"); United States v. Goldberg, 105

F.3d 770, 773 (1st Cir. 1997) (holding that "mere collateral

effects of jointly agreed-to activity, even if generally

foreseeable, are not mechanically to be treated as an object of the

conspiracy"); id. at 774 (noting that, in the case of a band of

bank robbers, "[a]ll know that the agreed-upon robbery will

generate 'income' that none of the robbers will report[, y]et it

would be straining to describe interference with the IRS as a

purpose or object of the conspiracy"). The inference of an

original agreement to conceal is particularly unwarranted here

given that, as the majority acknowledges, Upton and Alberico did

not consistently act in tandem following the money laundering.

Alberico filed a false return for 1997 that omitted the stolen

$900,000, while Upton filed his false return for that year in 2000.

In sum, "the essential missing element is a showing

that the act [of concealment] was done in furtherance of a prior

-35-
criminal agreement among the conspirators." Grunewald, 353 U.S. at

404 n.16. Because there is no evidence permitting the jury to find

that Upton and Alberico entered into an "express original

agreement" to cover up their money laundering activity, the tax

fraud may not be considered within the scope of the conspiracy on

that basis.

III.

Nor can the failure to file the 1999 tax return be viewed

as an act of concealment done in furtherance of the main objective

of the money laundering conspiracy. Although tax evasion is a

foreseeable consequence of virtually every financial crime,

Goldberg, 105 F.3d at 773, it is not inevitably within the scope of

every conspiracy to commit such crimes. The question is whether,

consistent with the second theory permitted by Grunewald, the jury

could find that "the successful accomplishment of the crime

necessitate[d]" that act of concealment.16 Id. at 405.

16
Count Four of the indictment alleged the following tax-related
conduct by Upton as part of the money laundering conspiracy:

5. It was a part of the conspiracy that defendants
George L. Upton and Lynn M. Alberico attempted to conceal
or disguise the nature, location, source, ownership, or
control of the illegal cash proceeds by failing to file
income tax returns, or declare a capital gain from the
sale of the commercial property, for the tax year 1999.
6. It was a part of the conspiracy that George L.
Upton attempted to conceal or disguise the nature,
location, source, ownership, or control of the illegal
cash proceeds by filing a materially false federal income
tax return in or about July 2000 that failed to declare
the receipt of the illegal income or the rental income

-36-
 The majority states that, because the purpose of the

money laundering conspiracy was to conceal the Queen theft,

"additional acts of concealment that facilitate the central aim of

the conspiracy are in furtherance of the conspiracy." The majority

asserts that the tax evasion meets this description: "[C]oncealing

the existence or financial impact of the money laundering

transactions[] is as much a part of the ongoing conspiracy to

launder money as repainting the car is a part of a theft

conspiracy."

This case does not, however, involve an "ongoing

conspiracy" that allegedly was intended to last beyond the set of

transactions that laundered the stolen $900,000. Such a continuous

conspiracy was described in United States v. Gardiner, 463 F.3d

445, 463 (6th Cir. 2006), where the court discussed crimes with

"'no specific terminating event'" – such as a conspiracy to fix

court cases or generalized loan-sharking activity – in which mid-

conspiracy concealment is necessary for the scheme to continue.

See id. (recognizing that, "[i]n conspiracies where a main

objective has not been attained or abandoned and concealment is

from the property in 1997.

The government argues that Upton's filing of a false return for
1997 also was an act in furtherance of the conspiracy, although the
majority does not rely on that conduct. I would have the same
objections to any such reliance as I do for Upton's failure to file
the 1999 return.

-37-
essential to success of that objective, attempts to conceal the

conspiracy are made in furtherance of the conspiracy") (citation

omitted); see also United States v. Esacove, 943 F.2d 3, 5 (5th

Cir. 1991) (noting that "'concealment is sometimes a necessary part

of a conspiracy'" to "'protect it from those investigative agencies

which threatened its continuation'" (quoting United States v. Del

Valle, 587 F.2d 699, 704 (5th Cir. 1979))). The money laundering

conspiracy charged here, focused as it is on transactions designed

to conceal a single crime, ended at a fixed point in time – when

those specific transactions were completed. See Papa, slip op. at

12 ("'[T]hough the result of a conspiracy may be continuing, the

conspiracy does not thereby become a continuing one.'" (quoting

Fiswick v. United States, 329 U.S. 211, 216 (1946)).

The flaw in the majority's reasoning is further revealed

by considering the Supreme Court's illustrative crimes in

Grunewald. With its stolen car and kidnaping examples, the Supreme

Court was describing acts of concealment that occur – as with

"ongoing" conspiracies – in tandem with the criminal conduct that

is the object of the charged conspiracy. In such cases, where the

concealment occurs before the object of the conspiracy is completed

(as with the kidnapers awaiting ransom) or coincident with its

completion (as with the new paint job on a stolen car), the

concealment is closely related in time to the commission of the

crime that is the conspiracy's goal. Such concealment directly

-38-
facilitates the crime's completion and, as such, it is properly

viewed as part of the original criminal undertaking rather than as

post-conspiracy cover-up.

Indeed, the Court in Grunewald extended its kidnaping

example by noting that the concealment addressed by the

government's proof at trial in that case was "[m]ore closely

analogous to . . . conspiring kidnapers who cover up their traces

after the main conspiracy is finally ended – i.e., after they have

abandoned the kidnaped person and then take care to escape

detection." 353 U.S. at 405. By confining "necessary" acts of

concealment to those that occur contemporaneously with the overt

acts that comprise the substantive crime, the Supreme Court's

concern in Grunewald – that acts of concealment not be used to

indefinitely extend the duration of a conspiracy – does not arise.

Here, too, the concealment relied upon by the government

to extend the duration of the conspiracy is more akin to the cover-

up conduct of kidnapers who have pocketed their ransom and

abandoned their victim. There is no dispute that the overt acts

that were the objective of the charged conspiracy – the financial

transactions prohibited by section 1956(a)(1)(B) – had ended, at

the latest, with the sale of the Iyanough Road property in January

1999.17 The failure to file a tax return more than a year later –

17
Although Upton appears to presume that the money laundering
transactions included the house sale, the list of transactions in
the indictment concludes with the purchase of the house.

-39-
assuming the usual April 15th deadline – is materially different

from either of the Supreme Court's examples of within-the-

conspiracy concealment. First, the tax evasion was remote in time

from the targeted transactions. Second, the tax conduct did not

facilitate those transactions. Upton and Alberico successfully

changed the cash into cashiers' checks and purchased the house in

1997, completing the money laundering conduct that was the

objective of the charged conspiracy. Their failure to file returns

showing the gain from the house protected the scheme after the fact

by concealing it, but that function is not enough to bring the tax

evasion within the scope of the money laundering conspiracy.

Indeed, that tax evasion is precisely the sort of post-

conspiracy concealment that the Court in Grunewald – as a matter of

policy – deemed insufficient to extend the statute of limitations.

By contrast, a car thief's repainting of the car – and, even more

so, the hiding of kidnapers waiting for ransom – is necessary for

the successful accomplishment of the crime that is the object of

the conspiracy.

The problem with the majority's logic is demonstrable by

applying it to a scenario in which Upton and Alberico had sold the

Iyanough Road house ten years later, in 2009, and similarly failed

to file tax returns reporting their gain. The majority's analysis

leads to the conclusion – impermissible under Grunewald – that the

money laundering conspiracy would have continued for another

-40-
decade, despite the lack of money laundering transactions

throughout that period. The majority disclaims such a conclusion

in its opinion in Alberico's appeal, noting that "the failure to

file [returns for 1999] was within a short time and thus likely to

be part of the conspirators' agreement."

The majority offers no principled basis, however, for

drawing a distinction between a failure to file a return disclosing

gain earned in 1999 and a failure to file a return reporting that

same gain earned at a later date. The concealment function

performed by the tax evasion is the same in both instances, and I

do not see how such concealment can be deemed an essential part of

the money laundering conspiracy at the earlier time but not later.18

Moreover, in both instances the objective of the money laundering

conspiracy – the commission of the crime of money laundering – had

18
Beyond highlighting the flaw in the majority's reasoning, the
hypothetical shows the problem in viewing the sale of the Iyanough
Road house – as distinguished from its purchase – as part of the
money laundering conspiracy. The laundering was accomplished by
converting the cash to cashier's checks that were then converted
into real estate, from which Upton and Alberico earned rent of
$1,000 a month. As Upton points out, if the failure to report
down-the-line profits from the laundered money (such as gain from
the house sale) is held to be within the scope of the original
money laundering conspiracy, the result would be an open-ended
statute of limitations – the Supreme Court's concern in Grunewald.
See 353 U.S. at 402 ("Sanctioning the Government's theory would for
all practical purposes wipe out the statute of limitations in
conspiracy cases . . . ."); see also United States v. Magluta, 418
F.3d 1166, 1180 (11th Cir. 2005) (holding that purchases using
laundered proceeds years after the payment that constituted the
original laundering could not be considered part of the money
laundering conspiracy).

-41-
already been completed. Hence, the timing of the tax evasion does

not support the majority's conclusion that it was within the scope

of the original money laundering conspiracy. To the contrary, the

tax conduct's remoteness from the charged objective of the

conspiracy – to launder the $900,000 by means of financial

transactions – confirms that it was not necessary to the

accomplishment of the conspiracy in the sense required by

Grunewald.

IV.

The majority's confusion undoubtedly stems in part from its

failure to appreciate the critical difference between the

conspiracy alleged here and the type of conspiracy charged in

Grunewald and other cases on which the majority relies, including

Goldberg and United States v. Mann, 161 F.3d 840, 859 (5th Cir.

1998). Those cases involved conspiracies brought under 18 U.S.C.

§ 371, which criminalizes any conspiracy "to defraud the United

States, or any agency thereof in any manner or for any purpose."

18 U.S.C. § 371. Such a conspiracy "can have multiple objects, and

any agreed-upon object can be a purpose of the conspiracy and used

to define its character." Goldberg, 105 F.3d at 774 (citing Ingram

v. United States, 360 U.S. 672, 679-80 (1959)).

Thus, under section 371, a defendant may be charged and

found guilty of conspiring to defraud the government by means of

tax conduct whose purpose was to conceal earlier illicit activity

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that was charged as a separate object of the same conspiracy. In

Mann, for example, the government alleged five separate objects of

the single conspiracy charged under section 371 in the indictment's

first count, including misuse of bank funds and the filing of false

income tax returns. Mann, 161 F.3d at 847-48. The court rejected

the defendants' Grunewald argument because "[t]he central aim of

the conspiracy" – as alleged in the indictment – included a purpose

to evade taxes. Mann, 161 F.3d at 859.

Grunewald also illustrates the potential breadth of

conspiracies under section 371. Although the case was tried on the

theory that the defendants' conspiratorial objective was to obtain

"no prosecution" rulings for certain taxpayers, the indictment

embraced the theory that the conspiracy's central object extended

beyond those provisional rulings "to immunize the taxpayers

completely from prosecution for tax evasion." Grunewald, 353 U.S.

at 408. The Supreme Court concluded that, under the limited theory

presented to the jury, the acts of concealment following the "no

prosecution" rulings could only be viewed as post-conspiracy cover-

up to protect the defendants. Under the broader theory, however,

those acts could be viewed as conduct in furtherance of the

conspiracy to fully protect the taxpayers from tax liability. Id.

at 409-411.

The Court remanded the case for a new trial because the

jury charge did not distinguish between concealment in order to

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achieve the central purpose of the more broadly stated conspiracy

(immunization of the taxpayers from tax-evasion prosecution), and

concealment intended solely to cover up a completed crime

(obtaining the "no prosecution" rulings). Id. at 413-14. To find

that the acts of concealment that took place within the limitations

period were in furtherance of the conspiracy, the jury needed to

find that "the basic aim of the conspiracy was not yet attained" at

that time – a determination the jury was not asked to make. Id. at

414.

As far as we know, therefore, the present
convictions were based on the impermissible
theory . . . that a subordinate agreement to
conceal the conspiracy continued after the
central aim of the conspiracy had been
accomplished. . . .

[T]he judge's charge left it open for the jury
to convict even though they found that the
acts of concealment were motivated purely by
the purpose of the conspirators to cover up
their already accomplished crime. And this,
we think, was fatal error.

Id.

The majority fails to recognize that the indictment here

is not similarly elastic. The indictment charged a conspiracy to

commit money laundering, in violation of 18 U.S.C. § 1956(a)(1)(B),

not a more general conspiracy under section 371 "to defraud the

United States, or any agency thereof" by concealing, through

various unlawful actions, the theft of Queen's money. Although the

indictment's conspiracy allegations included, under the heading

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"Manner and Means," that "[i]t was part of the conspiracy that

[defendants] attempted to conceal or disguise the . . . source

. . . or control of the illegal cash proceeds by failing to file

income tax returns . . . for the tax year 1999," the government's

description of a subsequent tax fraud that shared the same

concealment objective of the money laundering transactions cannot

turn the specific conspiracy alleged – to commit money laundering

– into a general conspiracy to conceal funds.19

Unlike the section 371 conspiracy charged in Mann, which

included a separate tax fraud objective, or the conspiracy charged

in Grunewald, whose general purpose to defraud the United States

could embrace acts of concealment subsequent to the "no

prosecution" ruling, a conspiracy to commit money laundering –

i.e., a conspiracy to conduct financial transactions – cannot, by

its terms, include a "central criminal purpose" to conceal income

from the IRS. Grunewald, 353 U.S. at 405. Put most simply, the

tax evasion did not further the "central aim" of the conspiracy,

which was to conduct financial transactions in order to conceal the

source of the $900,000. Hence, the tax evasion was not within the

19
The indictment originally included a count under section 371
alleging a conspiracy to structure transactions for the purpose of
evading federal currency reporting requirements. See 31 U.S.C.
§§ 5324(a)(3), 5322. As noted earlier, the district court
dismissed that count on the basis of the statute of limitations.
See United States v. Upton, 339 F. Supp. 2d 190, 196 (D. Mass.
2004).

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scope of the charged conspiracy. The conspiracy charge was

therefore barred by the statute of limitations.

V.

The majority is correct, of course, that Upton's failure

to file the 1999 tax return bears some relationship to the money

laundering conspiracy. As I have noted, both crimes share a

purpose to cover up the theft from Queen, with the tax evasion

presumably having the added purpose to cover up the money

laundering. Both the facts and the law, however, preclude a

finding by the jury that there was an express original subsidiary

agreement among the conspirators to cover up their crime, or a

finding that the failure to file the 1999 return was an act of

concealment done in furtherance of the money laundering conspiracy

within the meaning of Grunewald. Thus, while Upton was charged and

properly convicted of the separate crime of failing to file a tax

return, the majority errs in treating that independent crime as a

part of the money laundering conspiracy.

Because the conspiracy charge was time-barred, Upton's

conviction on Count 4 of the indictment should be reversed.

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