In the
United States Court of Appeals
For the Seventh Circuit
No. 11-1927
U NITED S TATES OF A MERICA,
Plaintiff-Appellee,
v.
M ARIO N UNEZ,
Defendant-Appellant.
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 10 CR 740-1—Amy J. St. Eve, Judge.
A RGUED JANUARY 25, 2012—D ECIDED M ARCH 9, 2012
Before B AUER, P OSNER, and R OVNER, Circuit Judges.
P OSNER, Circuit Judge. This criminal appeal requires us
to wrestle once again with the distinction between a
“mere” buyer-seller relation and a conspiracy involving
a buyer and a seller. For our earlier struggles with the
issue, see, e.g., United States v. Colon, 549 F.3d 565 (7th
Cir. 2008), and the six opinions in United States v. Lechuga,
994 F.2d 346 (7th Cir. 1993) (en banc).
The defendant was convicted by a jury of conspiracy
to possess and distribute cocaine, in violation of 21 U.S.C.
2 No. 11-1927
§§ 841(a)(1), 846, and of related offenses, and was sen-
tenced to 85 months in prison. He asks us to order that
he be acquitted of the conspiracy charge (and related
charges dependent on it), on the ground that no rea-
sonable jury could find him guilty of conspiracy. He
asks in the alternative that we order a new trial on the
ground that the verdict of conspiracy was against
the weight of the evidence.
Since the sale of illegal drugs is a crime, one might
think it would make no difference whether a defendant
was prosecuted as a seller or as a member of a con-
spiracy to sell, and hence that the government would be
assuming a gratuitous burden, in charging conspiracy, of
proving that the defendant was conspiring, and not just
selling. The concern—remote from the traditional criti-
cisms of the concept of conspiracy, see, e.g., Krulewitch v.
United States, 336 U.S. 440, 445-58 (1949) (Jackson, J.,
concurring); Harrison v. United States, 7 F.2d 259, 263 (2d
Cir. 1925) (L. Hand, J.)—is redundancy. United States v.
Reynolds, 919 F.2d 435, 439 (7th Cir. 1990). But there are
legitimate, significant advantages to prosecutors in drug
cases not only of proving conspiracy, which is not the
same thing as charging conspiracy, but also of obtaining
a verdict of conspiracy.
Although the sentence for selling or conspiring to sell
is the same when it is based on the same quantity of
drugs, 21 U.S.C. § 846, a conspiracy will often, as in this
case, embrace a greater quantity than the amount sold
by a single defendant; for it will include the amount
foreseeable to the defendant that the conspirators
No. 11-1927 3
intended to sell in furtherance of the conspiracy. True,
for conspiracy as for distribution the relevant quantity
for purposes of sentencing under the federal sentencing
guidelines is limited to the defendant’s “jointly under-
taken activity,” U.S.S.G. § 1B1.3(a)(1)(B); United States v.
Lewis, 110 F.3d 417, 422-23 (7th Cir. 1999); United States
v. Spotted Elk, 548 F.3d 641, 673-74 (8th Cir. 2008); United
States v. Laboy, 351 F.3d 578, 582 (1st Cir. 2003), a term
that while similar to “conspiracy” and often treated as
interchangeable with it, see United States v. Alvarado-Tizoc,
656 F.3d 740, 744 (7th Cir. 2011), is narrower because
the activity undertaken by the defendant in concert with
others is more limited than the activity, foreseeable to
him, of the entire conspiracy. See United States v. Morales,
655 F.3d 608, 635-36 (7th Cir. 2011); United States v.
Almanza, 225 F.3d 845, 846 (7th Cir. 2000). But proof of
conspiracy goes far to establish that the defendant’s
jointly undertaken activity involved a larger quantity of
drugs than those he himself sold.
For purposes of determining statutory (as distinct
from guidelines) minimums, moreover, the total amount
of drugs attributable to a conspiracy can be aggregated,
United States v. Easter, 553 F.3d 519, 523 (7th Cir. 2009), but
not the amounts involved in multiple counts of distribu-
tion. United States v. Resinos, 631 F.3d 886, 888 (8th Cir.
2011) (en banc) (per curiam); United States v. Sandlin, 313
F.3d 354, 355-56 (6th Cir. 2002) (per curiam); United States
v. Harrison, 241 F.3d 289, 291-92 (2d Cir. 2001). Statutory
minimum sentences, as in 21 U.S.C. §§ 841(b)(1)(A),
(b)(1)(B), are a boon to prosecutors because so many
sentences are below the guidelines ranges (in fiscal year
4 No. 11-1927
2010, 43 percent of sentences nationwide and 49 percent
in the Seventh Circuit, U.S. Sentencing Commission,
“National Comparison of Sentence Imposed and Position
Relative to the Guideline Range: Fiscal Year 2010,”,
www.ussc.gov/Data_and_Statistics/Annual_Reports_and_
Sourcebooks/2010/TableN.pdf, and “Comparison of
Sentence Imposed and Position Relative to the Guideline
Range by Circuit: Fiscal Year 2010,” www.ussc.gov/
Data_and_Statistics/Annual_Reports_and_Sourcebooks/
2010/TableN-7.pdf (both visited Feb. 23, 2012)).
Evidence of prior crimes is less likely to be barred from
admission by Fed. R. Evid. 404(b)(1) in a conspiracy
case, because prior crimes are likely to be germane to
establishing that the defendant had a relationship with
other participants in his drug deals that went beyond
mere buying or selling. See United States v. Gilmer, 534
F.3d 696, 705 (7th Cir. 2008); United States v. Penson, 896
F.2d 1087, 1092-93 (7th Cir. 1990); United States v. Mercado,
573 F.3d 138, 144 (2d Cir. 2009).
Out-of-court statements by a conspirator are freely
admissible in evidence against his coconspirators as
admissions of a party opponent, rather than being inad-
missible as hearsay, Fed. R. Evid. 801(d)(2)(E); United
States v. Rea, 621 F.3d 595, 604 (7th Cir. 2010); United
States v. Lopez, 649 F.3d 1222, 1238 (11th Cir. 2011);
United States v. Diaz, 597 F.3d 56, 67 (1st Cir. 2010), al-
though their admissibility requires not that conspiracy
be charged but only that it be proved by a preponderance
of the evidence. United States v. Bolivar, 532 F.3d 599,
604 (7th Cir. 2008); United States v. Martinez de Ortiz, 907
F.2d 629, 632 (7th Cir. 1990) (en banc).
No. 11-1927 5
The evidentiary burden on the government of proving
a conspiracy often is lighter than that of proving
multiple charges of distribution in order to maximize
the quantity of drugs for which the defendant can be
held responsible. Prosecuting every sale between seller
and buyer in this case, for example, would have been
difficult. The government had video evidence of only
two sales. Proving the others beyond a reasonable
doubt would have depended on the credibility of the
seller, who had been induced to testify for the government
and would be vulnerable to cross-examination. To per-
suade a jury to convict on a single conspiracy charge
the government need prove only an agreement. Quantity
is not an element, United States v. Garcia, 580 F.3d 528,
535 (7th Cir. 2009); Barker v. United States, 7 F.3d 629, 634
(7th Cir. 1993), and proof of an overt act is not required.
United States v. Shabani, 513 U.S. 10 (1994).
Charging a conspiracy can avoid a statute of limita-
tions defense that would be effective against a charge
of distribution. The statute of limitations for conspiracy
does not begin to run against an individual conspirator
until he withdraws from the conspiracy, United States
v. Wren, 363 F.3d 654, 663 (7th Cir. 2004), and it is dif-
ficult to prove that one has withdrawn other than by
becoming a government informant; mere cessation of
activity on behalf of the conspiracy is not enough. Hyde
v. United States, 225 U.S. 347, 369 (1912); United States v.
Paladino, 401 F.3d 471, 479-80 (7th Cir. 2005); United
States v. Borelli, 336 F.2d 376, 388 (2d Cir. 1964) (Friendly,
J.). And finally a small fry prosecuted for membership
in a conspiracy is unlikely to obtain a severance of his
6 No. 11-1927
trial from that of the ringleaders. See United States v. Tiem-
Trinh, 665 F.3d 1, 17 (1st Cir. 2011).
In the present case, however, by charging conspiracy
in addition to distribution the government handed the
defendant his only ground of appeal—a vexing ground
because of the difficulty of drawing a clear line between
sales, and conspiracies to sell, in particular cases.
The difficulty is illuminated by an antitrust analogy.
Section 1 of the Sherman Act punishes contracts, combina-
tions, and conspiracies in restraint of trade, 15 U.S.C. § 1,
and the distinction among these terms is unimportant.
If a seller signs a contract with a buyer that sets a floor
under the retail price at which the buyer may resell the
seller’s product, the resulting limitation on intrabrand
price competition can be challenged under section 1 as
a contract in restraint of trade, but equally as a con-
spiracy in restraint of trade; for “conspiracy” in section 1
is simply a pejorative term for a contract, both “conspir-
acy” and “contract” signifying an agreement, a meeting
of minds. That is equally true when one person
agrees to sell illegal drugs to another. Of course to be
legally enforceable a contract requires certain formali-
ties, which will not be found in a conspiracy. But their
absence is of no moment; a criminal contract is unenforce-
able whatever form it takes.
The federal drug laws, however, insist on the distinction
between a conspiracy and a contract of sale. E.g., United
States v. Vallar, 635 F.3d 271, 286-87 (7th Cir. 2011); United
States v. Johnson, 592 F.3d 749, 754-57 (7th Cir. 2010); United
States v. Delgado, No. 07-41041, 2012 WL 574012, at *7-8 (5th
No. 11-1927 7
Cir. Feb. 22, 2012) (en banc); id. at *33-38 (dissenting
opinion), and cases cited in id. at *33 n. 20. As explained
in United States v. Colon, supra, 549 F.3d at 569, quoting
United States v. Townsend, 924 F.2d 1385, 1394 (7th Cir.
1991), “there are practical reasons for not conflating sale
with conspiracy. ‘A sale, by definition, requires two
parties; their combination for that limited purpose does
not increase the likelihood that the sale will take place,
so conspiracy liability would be inappropriate.’ ” But “a
conspiracy involves more people and can therefore
commit more crimes; and it can do so more efficiently,
by exploiting the division of labor and by arranging
concealment more effectively—sometimes through
suborning law enforcers.” United States v. Manzella, 791
F.2d 1263, 1265 (7th Cir. 1986).
So there must be more than just a sale of drugs to sup-
port an inference of conspiracy, and the question is what
more. The answer might seem to depend on how the
criminal law draws the line between contract and con-
spiracy. The line might run between “contract” conceived
of as a purely arm’s-length relationship and “conspiracy”
conceived of as a cooperative relationship—a relationship
of mutual assistance. See United States v. Speed, 656 F.3d
714, 719 (7th Cir. 2011); United States v. Townsend, supra,
924 F.2d at 1392. Actually that would be a distinction
among types of contract. A spot contract, illustrated in
its purest form by a trade on a stock exchange, involves
a minimal relationship, because there is only the single
transaction and the parties may not even be identified
to each other. In contrast, the aptly named “relational
contract,” such as a long-term requirements contract,
creates a continuing relationship flexible enough to
8 No. 11-1927
adapt to changes of circumstance that could not have
been fully anticipated when the contract was negotiated.
See Charles J. Goetz & Robert E. Scott, “Principles
of Relational Contracts,” 67 Va. L. Rev. 1089, 1092-95
(1981). So one way to understand a drug conspiracy is as
a relational contract among drug dealers. See United
States v. Lechuga, supra, 994 F.2d at 349 (plurality opinion).
Without necessarily endorsing that approach, let us
consider on which side of that line the present case falls.
The defendant had bought almost two kilograms of
cocaine from a man named Latine over a period of 18
months. Some of the sales had been on credit, and Latine
had sometimes allowed the defendant to return cocaine
he had bought because it was not of the agreed-upon
quality, and when that happened Latine had refunded
the purchase price. It is unclear how many sales in total
he made to the defendant over the course of their rela-
tionship, but from his testimony concerning the amount
of each sale a jury could reasonably infer that there
had been at least seven sales.
These facts just reveal a commonplace wholesale rela-
tionship. The defendant was a retail dealer, which
means that he probably had a number of customers and
that his sales to them were spot transactions, while he
had a continuing relation with his wholesaler, Latine.
Sales on credit and returns for refunds are normal inci-
dents of buyer-seller relationships, spot or otherwise; so
thus far all we’ve seen to distinguish the defendant’s
dealings with Latine from “mere” sales is that the sales
were not spot transactions and were wholesale rather
than retail sales.
No. 11-1927 9
The government adds that there was “mutual trust”
between the defendant and Latine, and it cites cases in
which our court and other courts have described “mutual
trust” as a factor that distinguishes an ordinary drug sale
from a drug conspiracy. E.g., United States v. Kincannon,
567 F.3d 893, 898-99 (7th Cir. 2009); United States v.
Baugham, 449 F.3d 167, 173 (D.C. Cir. 2006); United States
v. Washington, 318 F.3d 845, 852 (8th Cir. 2003). But
mutual trust is just an implication of illegal sales on
credit; since you cannot sue a buyer who stiffs you in an
illegal transaction, you must trust him in order to be
willing to extend credit to him. See United States v. Colon,
supra, 549 F.3d at 567-68; United States v. Baugham, supra,
449 F.3d at 173. It is not an additional factor but rather
a way of explaining why sales on credit are a factor in
inferring conspiracy. It would be different if mutual trust
were being inferred from a familial relationship or
some other circumstance distinct from a willingness to
make an illegal sale on credit.
But this leaves unanswered the question why wil-
lingness to sell illegal drugs on credit is evidence of
conspiracy, when it is such a common feature of legal
selling. Less trust is involved in legal sales on credit,
since the seller has legal remedies; but why should trust
be thought indicative of conspiracy? That would imply
that sales on credit were made only to coconspirators.
Moreover, parties to an illegal sale must trust each
other more than is normal in legal sales, even when the
sale is for cash rather than on credit: trust each not to
rob the other and not to be or to turn government infor-
mant.
10 No. 11-1927
Since an agreement to commit a crime is a conspiracy,
the wholesaling of illegal drugs on credit could be
thought to give rise to an automatic inference of con-
spiracy. The wholesaler knows the retailer will repay
the loan by committing the crime of selling the illegal
drugs that he’s acquired on credit, and by acquiescing
the wholesaler becomes a party to the retail sale, which
is to say to an agreement to commit a crime, which is a
conspiracy. For cases supportive of this approach, see, e.g.,
United States v. Vallar, supra, 635 F.3d at 286; United States
v. Rock, 370 F.3d 712, 714-15 (7th Cir. 2004); United States
v. Kozinski, 16 F.3d 795, 808 (7th Cir. 1994); United States
v. Lechuga, supra, 994 F.2d at 350 (plurality opinion); United
States v. Parker, 554 F.3d 230, 238-39 (2d Cir. 2009). The
approach is attractive both conceptually, by aligning
conspiracy with an agreement to commit a crime, and as
a welcome simplification of doctrine, by drawing a
bright line between the retail and wholesale drug trades
and treating the relationship between wholesaler and
retailer as conspiracy rather than trying to distinguish
contract from conspiracy on the basis of “plus” factors
that seem mostly makeweights, such as mutual trust
when it is just an inference from sales on credit. Applica-
tion of this approach in the present case would nail
the defendant.
And this may be where the law is headed, as the cases
just cited indicate. But a number of other cases, such as
United States v. Johnson, supra, 592 F.3d at 755-57, and
United States v. Townsend, supra, 924 F.2d at 1392, reject
such a rule.
No. 11-1927 11
We needn’t choose between the two lines of authority
in this case, because there is additional evidence of con-
spiracy.
Latine’s supplier was the defendant’s father. He had
been the son’s wholesale supplier, but they had quarreled
and the son had switched to buying from Latine, though
the father remained his son’s indirect supplier. One
evening the defendant by chance saw Latine’s car
stopped by the side of a road and being searched by
police. The defendant telephoned his father to tell him
what was happening, and they agreed that Latine’s
family should be told and should be urged to discard
any drugs that Latine might have in the house. The
father directed his son to tell the family these things, and
also to leave Latine’s house promptly after doing so,
before the police arrived. He also told his son that he
was in touch with a person at the scene of the arrest
who was waiting to see whether the police would dis-
cover the drugs hidden in Latine’s car and arrest him.
We needn’t decide whether a conspiracy with the
father was formed by the discussion with the son, or
indeed pre-existed the discussion (which would be no
surprise, since the father was Latine’s supplier). It is
enough that the episode reveals mutual support and
protection grounded in a family relationship that
provided linkage that is not a common feature of whole-
saling. Cf. United States v. Murray, 474 F.3d 938, 941
(7th Cir. 2007). When he learned of Latine’s arrest the
defendant could simply have cleared out; instead he
tried to save Latine’s business. The family connection—
12 No. 11-1927
the defendant’s father being Latine’s direct and the son’s
indirect supplier and the quarrel between father and son
being forgotten in a crisis—had forged a relationship
between Latine and the defendant that the jury was
entitled to characterize as conspiring to distribute
drugs rather than merely buying and selling them.
United States v. Rea, supra, 621 F.3d at 608; United States
v. Johnson, supra, 592 F.3d at 755-56. The judgment is
therefore
A FFIRMED.
3-9-12