United States Court of Appeals
FOR THE EIGHTH CIRCUIT
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No. 96-1246
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United States of America, *
*
Appellant, *
* Appeal from the United States
v. * District Court for the Northern
* District of Iowa.
Donald Lee Earles and *
Catherine Papajohn, *
*
Appellees. *
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Submitted: January 16, 1997
Filed: May 8, 1997
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Before RICHARD S. ARNOLD, Chief Judge, ROSS, and BEAM, Circuit Judges.
___________
BEAM, Circuit Judge.
The government appeals the district court’s judgment of acquittal in
favor of defendants Donald Lee Earles and Catherine Papajohn. We reverse.
I. BACKGROUND
On October 24, 1991, a grand jury indicted Donald Lee Earles (Earles)
and Catherine Papajohn (Papajohn) for their roles in the burning of the
Countryside IGA in Sloan, Iowa. Count One of the indictment charged Earles
with maliciously damaging and destroying
the grocery store and Papajohn with aiding and abetting that destruction.
The indictment further charged Earles and Papajohn with: (1) devising a
scheme to defraud St. Paul Fire and Marine Insurance Company (St. Paul)
(Counts Two and Three); (2) laundering the proceeds received from the mail
fraud (Count Four); and (3) conspiring to commit an offense against the
laws of the United States, i.e., mail fraud and money laundering (Count
Five). The indictment also sought the forfeiture of approximately
$188,665.00, the amount received as proceeds of the defendants’ allegedly
unlawful activities.
Prior to the indictment, Earles’s son Donald Scott Earles (Donnie)
testified before the grand jury three times.1 During Donnie’s first grand
jury appearance, he stated that he did not know who burned the Countryside
IGA, but that he would not put it past his father and Papajohn to do such
a thing. At his second grand jury appearance, Donnie admitted to knowing
more facts about the burning of the IGA and testified to those facts in
great detail. At his third appearance, Donnie stated that he would not
comment further on the fire or testify against his father or Papajohn, his
father’s girlfriend.
The testimony Donnie gave during his second grand jury appearance can
be summarized as follows. Earles told Donnie on the
1
Earles, Papajohn, Donnie and another individual had
previously been the subject of an investigation into a mail fraud
scheme in which they allegedly sold non-existent propane tanks,
bailing wire and twine to farmers. United States v. Earles, 955
F.2d 1175 (8th Cir. 1992). Trial of that matter resulted in
Earles’s conviction and Papajohn’s acquittal. Id. at 1177. In
exchange for being permitted to enter a guilty plea to conspiracy
to commit mail fraud, Donnie agreed to cooperate with the
government in several matters under investigation, including the
burning of the IGA. Donnie’s grand jury appearances were pursuant
to that plea agreement.
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day of the fire that he planned to burn the IGA, had unsuccessfully
attempted to do so the night before, and would try again that night.
Earles explained that he and Papajohn had stockpiled lighter fluid in the
store in preparation for the fire. On the night of the fire, Donnie was
very nervous for his father and hung around the store until his father made
him leave. After leaving the store, Donnie parked his car at Papajohn’s
residence and walked back to the IGA. At one point in the evening, Donnie
remembers waving to a local police officer who was patrolling the area.
Earles told Donnie that he and Papajohn wanted to be rid of the IGA and
needed the money from the insurance to pay off their debts and start over
again. After the fire, Earles told Donnie that he had barely been able to
get out of the store because the lighter fluid ignited so quickly.
Earles and Papajohn filed numerous pretrial motions. The district
court granted Papajohn’s motion for severance and her case proceeded to
trial. At that trial, Donnie refused to testify and stated that he was
asserting his privilege against self-incrimination. Despite the
government’s grant of use immunity for his testimony and the district
court’s explanation that such immunity rendered his claim of Fifth
Amendment immunity unavailing, Donnie continued to refuse to testify at
trial, explaining that he did not want to testify against his father or
Papajohn. The district court held Donnie in contempt and jailed him for
his failure to testify. After granting a continuance, the district court
explained that a mistrial would be granted if Papajohn agreed to be tried
together with Earles. Papajohn agreed and the district court declared a
mistrial.
At the subsequent joint trial of Earles and Papajohn, Donnie again
refused to testify, in spite of the intervening jail time and another grant
of immunity. The district court declared Donnie an
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unavailable witness and allowed the government to read to the jury redacted
portions from all three of the transcripts of Donnie’s grand jury
testimony, over defendants’ objection.
In addition to Donnie’s testimony, a local deputy sheriff testified
that he had observed Earles and Donnie entering and exiting the IGA and a
nearby building around 1:00 a.m. on the night of the fire. Because the
officer was suspicious of the late night activity, he drove by the store
again later that night. At that time, he followed the men’s vehicle to
Papajohn’s residence where they entered through the garage. Still later
that same morning, the officer received the call regarding the fire at the
IGA.
The government also presented evidence that the fire investigators
had concluded that arson was the cause of the fire. The investigators
agreed that the fire was incendiary in origin and that a flammable liquid
had been used as an accelerant. In addition, the government presented
evidence that Papajohn had been experiencing financial difficulty and was
behind in her payments to creditors and vendors, including six months
behind in payments on a secured note for the IGA inventory. Further
evidence showed that Papajohn processed her proof of loss with St. Paul
through the mail. Papajohn, in return, was sent checks from St. Paul
totaling $188,665.00 in settlement of her claim.
The jury convicted Earles of one count of arson, two counts of aiding
and abetting the crime of mail fraud, and one count of conspiracy.
Papajohn was convicted of one count of aiding and abetting arson, two
counts of mail fraud, and one count of conspiracy. After trial, defendants
moved for a judgment of acquittal or, in the alternative, a new trial.
They contended that the district court erred in allowing Donnie’s grand
jury testimony into evidence and that the government’s evidence, without
the grand
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jury testimony, was insufficient to support the convictions. The district
court agreed and entered a judgment of acquittal. It denied defendants’
alternative motions for a new trial. The government appeals, arguing that
the grand jury testimony was properly admitted and, if not, that the
defendants should be retried.
II. DISCUSSION
A. Admission of Grand Jury Testimony
As indicated, after Donnie refused to testify, the government offered
portions of Donnie’s grand jury testimony into evidence. The defendants
objected, arguing that such testimony was inadmissible hearsay. The
district court first determined that Donnie was an unavailable witness due
to his continuing refusal to testify despite court orders to do so. Fed.
R. Evid. 804(a)(2). The district court then determined that although
Donnie’s grand jury testimony was not admissible under the former testimony
exception to the hearsay rule, because it was not subject to cross
examination, Federal Rule of Evidence 804(b)(1); United States v. Salerno,
505 U.S. 317, 321-22 (1992), it was admissible under the residual hearsay
exception, Federal Rule of Evidence 804(b)(5). The district court later
determined that the admission of the grand jury testimony was error. We
find, however, that Donnie’s testimony was admissible under Rule 804(b)(5).
Rule 804(b)(5), considered the residual or “catch-all” exception to
the hearsay rule, provides in relevant part:
A statement not specifically covered by any of the foregoing
exceptions but having equivalent circumstantial guarantees of
trustworthiness, [is admissible] if the court determines that
(A) the statement is offered as
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evidence of a material fact; (B) the statement is more
probative on the point for which it is offered than any other
evidence which the proponent can procure through reasonable
efforts; and (C) the general purposes of these rules and the
interests of justice will best be served by admission of the
statement into evidence.
Fed. R. Evid. 804(b)(5) (emphasis added). The district court held that
Donnie’s grand jury testimony, as former testimony, was “specifically
covered” by another exception to the hearsay rule, namely section 804(b)(1)
and was, therefore, inadmissible under the catch-all exception. United
States v. Earles, No. CR 91-4016-DEO, order at 11 (N.D. Ia., Dec. 29, 1995)
(citing United States v. Vigoa, 656 F. Supp. 1499, 1504 (D.N.J. 1987),
aff’d without opinion, 857 F.2d 1467 (3d Cir. 1988)). In so holding, the
district court committed reversible error.
The meaning of the catch-all’s “specifically covered” language has
caused considerable debate. See, e.g., McKethan v. United States, 439 U.S.
936 (1978) (Justices Stewart and Marshall dissenting from the Court’s
denial of writs of certiorari and contending that the Court should resolve
the circuit split on this issue). However, the majority of circuit courts
have held that the phrase “specifically covered” means only that if a
statement is admissible under one of the prior exceptions, such prior
subsection should be relied upon instead of subsection (b)(5). If, on the
other hand, the statement is inadmissible under the other exceptions, these
courts allow the testimony to be considered for admission under Rule
804(b)(5). United States v. Marchini, 797 F.2d 759, 763 (9th Cir. 1986)
(compiling cases); see United States v. Deeb, 13 F.3d 1532, 1536-37 (11th
Cir. 1994); United States v. Clarke, 2 F.3d 81, 84 (4th Cir. 1993); United
States v. Guinan, 836 F.2d 350, 354 (7th Cir. 1988).
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This court has previously validated the use of grand jury testimony
under Rule 804(b)(5), although without discussing the meaning of the rule’s
“specifically covered” language. United States v. Carlson, 547 F.2d 1346,
1355 (8th Cir. 1976). In that case, we affirmed the district court’s use
of Rule 804(b)(5) to admit a declarant’s prior grand jury testimony. Id.
Here, in declining to follow Carlson, the district court stated that “the
law surrounding this issue has been more fully developed since 1976" and
that it was thus not “inappropriate” to distinguish the Carlson case.2
United States v. Earles, order at 15. To the contrary, we reaffirm our
holding in Carlson and hold that if a statement is inadmissible under a
prior hearsay exception, the statement may nonetheless be considered for
admission under the catch-all exception.3
2
The district court also found that the Supreme Court’s
decision in United States v. Salerno compelled this result.
Salerno, 505 U.S. at 317. We disagree. The Salerno case contains
no references to Rule 804(b)(5). It deals solely with the
propriety of admitting grand jury testimony under Rule 804(b)(1),
as former testimony. Id. at 321. Therefore, we do not believe
that Salerno addressed the question presented in this case, much
less compelled the result reached by the district court.
3
We think that “specifically covered” means exactly what it
says: if a statement does not meet the requirements for admission
under a prior exception, then it is not “specifically covered” by
that exception and can be considered for admission under the catch-
all. We agree with the reasoning of the Eleventh Circuit:
“If a statement does not satisfy all of the requirements
of Rule 804(b)(1), then it is not a statement ‘covered by
[one] of the foregoing exceptions’ within the meaning of
Rule 804(b)(5). We consider admissible those statements
that are similar though not identical to hearsay clearly
falling under one of the four codified exceptions, if the
statements otherwise bear indicia of trustworthiness
equivalent to those exceptions. The contrary reading
would create an arbitrary distinction between hearsay
statements that narrowly, but conclusively, fail to
satisfy one of the formal exceptions, and those hearsay
statements which do not even arguably fit into a
recognized mold.”
Deeb, 13 F.3d at 1536-37 (quoting United States v. Fernandez, 892
F.2d 976, 981 (11th Cir. 1990)).
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To be admissible under the catch-all exception, the proffered
statement must have circumstantial guarantees of trustworthiness. “In
assessing the qualitative degree of trustworthiness of a particular
statement, courts should inquire into the reliability of and necessity for
the statement.” Carlson, 547 F.2d at 1354. Donnie testified under oath
and under penalty of perjury at the grand jury proceeding. He related
facts of which he had personal knowledge, so the “possibility of faulty
recollection was minimized.” Id. Except to admit that he knew more than
earlier stated, Donnie never recanted his testimony nor did any extrinsic
evidence cast doubt on the accuracy of that testimony. In addition to its
reliability, there was a substantial need for the testimony because Donnie
was unavailable to testify at trial and there were no other persons, to the
government’s knowledge, who could testify about the events in question.
Id. These facts adequately fulfill the catch-all’s requirement that the
statement bear circumstantial guarantees of trustworthiness.4
The other requirements of Rule 804(b)(5) are also satisfied in this
case. As previously noted, Donnie was an unavailable witness. Fed. R.
Evid. 804(a)(2). Donnie’s testimony was evidence of a
4
Furthermore, we note the similarities between Rule
804(b)(5)’s requirement of circumstantial guarantees of
trustworthiness and the Confrontation Clause’s requirement that a
statement bear adequate indicia of reliability, discussed infra at
9. See Idaho v. Wright, 497 U.S. 805, 814 (1990); United States v.
Woolbright, 831 F.2d 1390, 1397 (8th Cir. 1987). Donnie’s
statements meet Rule 804(b)(5)’s trustworthiness requirement for
the additional reasons discussed in our Confrontation Clause
analysis.
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material fact in that it directly implicated Earles and Papajohn and showed
their intent and plan. The facts were more probative than any other
available evidence and there has been no indication that the prosecution
could obtain the proof elsewhere. Furthermore, the interests of justice
were served by the admission of this evidence. The government granted
Donnie immunity in an attempt to secure his trial testimony, and only
relied on the grand jury testimony after Donnie’s continuing refusals to
testify at trial. Also, because of the circumstantial guarantees of
trustworthiness surrounding the testimony and its overall probative value,
the admission of this evidence increased the likelihood that the jury would
ascertain the truth about the cause of the fire. See Huff v. White Motor
Corp., 609 F.2d 286, 295 (7th Cir. 1979). Finally, defendants Earles and
Papajohn had notice of the prosecution’s intent to use Donnie’s grand jury
testimony against them if Donnie refused to testify at trial. Therefore,
we find that the grand jury testimony in this case is admissible under the
catch-all exception.
This does not end our inquiry, however, because incriminating
statements that are admissible under an exception to the hearsay rule are
nonetheless inadmissible under the Confrontation Clause unless the
prosecution either produces the declarant for cross-examination or
demonstrates both that the declarant is unavailable and that the statement
bears adequate indicia of reliability. Idaho v. Wright, 497 U.S. 805, 814
(1990). As the Supreme Court has stated, “[W]hen a hearsay declarant is
not present for cross-examination at trial, the Confrontation Clause
normally requires a showing that he is unavailable. Even then, his
statement is admissible only if it bears adequate ‘indicia of
reliability.’” Ohio v. Roberts, 448 U.S. 56, 66 (1980). This reliability
requirement can be met where a statement either falls within a
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firmly rooted hearsay exception or is supported by a showing of
particularized guarantees of trustworthiness. Id.
Once again, we note that Donnie was clearly unavailable as a witness
under Rule 804(a)(2). Next, assuming that no firmly rooted hearsay
exception applies here, we must consider whether Donnie’s testimony had
particularized guarantees of trustworthiness. Such guarantees of
trustworthiness must “be drawn from the totality of circumstances that
surround the making of the statement and that render the declarant
particularly worthy of belief.” Wright, 497 U.S. at 820. However,
evidence corroborating the truth of a hearsay statement is not relevant to
a finding of trustworthiness. Id. at 822. Under these stringent
requirements, we, nonetheless, find that Donnie’s grand jury testimony was
supported by guarantees of trustworthiness sufficient to warrant its
admission without an opportunity for confrontation.
We note that Donnie’s testimony was given under oath. Carlson, 547
F.2d at 1354. Although Donnie was at first reluctant to implicate his
father, he eventually chose to explain the events surrounding the store
burning, stating that he was only offering the testimony because it was the
right thing to do. Furthermore, Donnie never recanted his inculpatory
testimony or expressed belated views as to its accuracy. Id. Although he
later refused to further implicate his father or Papajohn, Donnie never
denied the truth of his earlier statements. Also, we think it unlikely
that Donnie would implicate his father and Papajohn in a serious crime
unless the story were true. See, e.g., United States v. Roberts, 844 F.2d
537, 546 (8th Cir. 1988) (stating it was unlikely that family member would
testify falsely against another family member). Donnie’s willingness to
sit in jail instead of testifying against his father and Papajohn lends
further credence to this
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factor. Id. If Donnie’s testimony would have exonerated his father, he
would presumably have testified to that effect.
B. Judgment of Acquittal
We turn to the district court’s grant of judgment of acquittal for
the defendants. A motion for judgment of acquittal should only be granted
“where the evidence, viewed in the light most favorable to the government,
is such that a reasonably minded jury must have a reasonable doubt as to
the existence of any of the essential elements of the crime charged.”
United States v. Mundt, 846 F.2d 1157, 1158 (8th Cir. 1988). See also
United States v. Robbins, 21 F.3d 297, 299 (8th Cir. 1994); United States
v. Pardue, 983 F.2d 843, 847 (8th Cir. 1993). This standard allows the
district court very limited latitude; it can neither weigh the evidence nor
assess the credibility of witnesses. Pardue, 983 F.2d 847 (citing Burks
v. United States, 437 U.S. 1, 16 (1978)). The test is the same for this
court as for the district court.
A brief review of the evidence presented at trial shows that there
was more than sufficient evidence to sustain the guilty verdicts. The
government introduced evidence that Papajohn’s grocery store had not been
doing well and that she was behind in her payments on the store. There was
further evidence that both Papajohn and Earles found the store to be a
burden, desired to be rid of it, and had unsuccessfully tried to sell it.
Donnie’s testimony showed that Earles had planned to burn the store, a
prior attempt had failed, and that the night Earles burned the store, he
had barely been able to get out of the store safely because the lighter
fluid burned so quickly. Furthermore, the fire investigators determined
the cause of the fire was arson and Earles and Papajohn were easily tied
to that arson. Additionally, there
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was ample evidence of Papajohn’s use of the mails to process and collect
money for the insurance claim. Based on all of the evidence presented at
trial, we conclude that more than sufficient evidence was presented to
sustain the guilty verdicts. Therefore, the district court erred in
granting defendants’ motions for judgment of acquittal.
In light of our holding that Donnie’s grand jury testimony was
properly admitted, however, the district court correctly denied defendants’
motions for a new trial on that ground. We have considered the remainder
of defendants’ arguments and motions and find them to be without merit.
III. CONCLUSION
Because the district court erred in ruling the grand jury testimony
should have been excluded and in issuing a judgment of acquittal for
defendants, we reverse. We remand this case to the district court for the
reinstatement of the jury’s verdict.
A true copy.
Attest:
CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.
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