United States v. High

United States Court of Appeals.

Eleventh Circuit.

Nos. 94-8151, 94-8230.

UNITED STATES of America, Plaintiff-Appellee,

v.

George W. HIGH, Sr., Virginia C. High, Defendants-Appellants.

UNITED STATES of America, Plaintiff-Appellee,

v.

Robert L. WARD, Jr., Defendant-Appellant.

July 21, 1997.

Appeals from the United States District Court for the Northern District of Georgia. (No. 1:92-cr-
182-12), Robert Vining, Judge.

Before HATCHETT, Chief Judge, TJOFLAT, Circuit Judge, and GODBOLD, Senior Circuit Judge.

PER CURIAM.

In this multiple-object cocaine distribution and possession case, we affirm the appellants'

convictions for conspiracy to distribute and possess with intent to distribute cocaine, and aiding and

abetting a conspiracy, but we reverse the appellants' convictions for conspiracy to launder drug

proceeds, structure currency transactions and defraud the United States, following the Supreme

Court's decision in Ratzlaf v. United States, 510 U.S. 135, 114 S.Ct. 655, 126 L.Ed.2d 615 (1994).

Appellants George High, Virginia High and Robert Ward appeal their convictions and

sentences on charges arising from a complex drug conspiracy. Among other things, the Highs

contend that the evidence was insufficient to support their convictions on Count One of the

indictment—conspiracy to distribute and possess with intent to distribute cocaine, and aiding and

abetting a conspiracy. All the appellants contend that the district court gave an erroneous jury

instruction which requires reversal of their convictions on Count Thirteen of the indictment—a

multiple-object conspiracy to launder drug proceeds, structure currency transactions and defraud the

United States. We affirm the Highs' convictions on Count One, and reverse the appellants'
convictions on Count Thirteen.1

BACKGROUND

A. District Court Proceedings

On December 10, 1992, a grand jury indicted George High, Virginia High and Robert Ward

along with a number of other alleged coconspirators, charging that they were involved in a complex

drug conspiracy. In a thirty-nine count indictment, Count One charged the Highs and others (not

including Ward) with conspiring to distribute and possess with intent to distribute cocaine, and

aiding and abetting a conspiracy, in violation of 18 U.S.C. § 2 and 21 U.S.C. §§ 841(a)(1) and 846.

Count Thirteen charged the Highs, Ward and others with engaging in a multiple-object conspiracy

to launder drug proceeds, structure currency transactions and defraud the government, in violation

of 18 U.S.C. §§ 2 and 371.

On September 21, 1993, the Highs and Ward (and one other alleged coconspirator)

proceeded to trial together. The jury returned guilty verdicts against the Highs on Count One and

against the Highs and Ward on Count Thirteen. The jury also returned guilty verdicts against

George High on weapons charges, against Virginia High on money laundering charges, and against

both the Highs on substantive charges of structuring currency transactions.2 The district court

1
The appellants also raise various other issues relating to the indictment and their sentences.
These issues do not merit extensive discussion, and we thus address them here in summary
fashion. In addition to the contentions described above, Virginia High contends that (1) the
district court erred in instructing the jury on "deliberate ignorance" as to the intent requirement
for money laundering; and (2) the district court's failure to grant her a bond hearing denied her
procedural and substantive due process rights. Accordingly, Virginia High asserts that we must
reverse her convictions on counts seventeen, eighteen, twenty, twenty-three and twenty-four of
the indictment, and/or declare unconstitutional the statute regulating bail pending appeal. We
find neither of these contentions persuasive and affirm pursuant to Eleventh Circuit Rule 36-1.

Virginia High and George High also contend that the district court erred in
refusing to give the jury a "good faith" instruction on Count Thirteen of the indictment.
Because we vacate the convictions on Count Thirteen for other reasons, this issue is
moot. Robert Ward contends that the district court erred in sentencing him on Count
Thirteen under money laundering guidelines rather than money structuring guidelines.
This issue is also moot given our decision to vacate the Count Thirteen convictions.
2
The district court subsequently vacated the convictions against the Highs on the structuring
currency transactions charges in light of the Supreme Court's ruling in Ratzlaf v. United States,
510 U.S. 135, 114 S.Ct. 655, 126 L.Ed.2d 615 (1994). We discuss the Ratzlaf holding infra.
sentenced the Highs to ninety-seven month terms of incarceration, and Ward to a forty-one month

term of incarceration. The Highs and Ward filed timely appeals challenging their convictions and/or

sentences, although George High did not appeal his conviction on weapons charges.

B. The Drug Conspiracy

The drug conspiracy took place primarily in Atlanta, Georgia, during a period from at least

1987 until mid to late 1992. The conspiracy involved a large number of cocaine wholesalers who

were connected in a vertically and horizontally integrated cocaine distribution network operating

in the metropolitan Atlanta area. The conspiracy also involved the cocaine wholesalers' "legitimate"

business associates who used their enterprises to help the cocaine wholesalers convert large drug

cash flows into goods, services and other assets. According to the government, some of the cocaine

wholesalers had a particularly extensive—and ultimately illegal—relationship with George and

Virginia High, who owned and operated a commercial and residential real estate business, and

Robert Ward, who brokered automobiles.

At trial, the government introduced evidence that at various levels of the distribution chain

the cocaine wholesalers realized profits of between $1,000 and $10,000 in cash on the sale of each

kilogram of cocaine. According to trial witnesses, the cocaine wholesalers then sought out

"legitimate" business associates to help convert this cash into other, more useful types of assets, such

as real estate and automobiles. George and Virginia High, owners and operators of High Realty,

allegedly served as two such business associates for the cocaine wholesalers.

At trial, the government introduced voluminous evidence of the illicit relationship between

the Highs and the cocaine wholesalers. In particular, the government presented evidence that

George High, High Realty's "broker," and Virginia High, a High Realty sales associate, purchased

several properties for the cocaine wholesalers and structured the purchase transactions in manners

that concealed the source of the money used to buy the property, and circumvented the currency

transaction reporting requirements contained in 31 U.S.C. § 5313(a). On one occasion in 1989, for

instance, George High helped cocaine wholesaler Sims Jinks purchase a residence in DeKalb

County, Georgia. Jinks supplied George High with $35,000 in cash that George High converted into
five separate cashier's checks to make the down payment on the residence. Jinks and George High

made the remaining $45,000 in payments on the residence directly to the seller in cash at the High

Realty office.

A year later, Virginia High helped Jinks purchase another residence. As before, Jinks

provided $35,000 in cash for the down payment, and Virginia High obtained five cashier's checks

to make the down payment to the seller. Jinks paid the remaining $200,000 owed on the balance

of the mortgage in cash over a fourteen-month period of time. Although Jinks owned the residence,

it was purchased in Virginia High's name. When the government arrested Jinks and notified

Virginia High that it intended to seize the residence, Jinks and the Highs executed deeds transferring

title of the residence to Jinks. This allowed Jinks to mortgage the property and obtain a large line

of credit, depriving the government of much of the residence's seizure value.

The government presented evidence showing that the Highs received and dealt with hundreds

of thousands of dollars in cash derived from the unlawful activities of several cocaine wholesalers.

In addition to helping the cocaine wholesalers make purchases, the Highs also managed some of the

cocaine wholesalers' properties and maintained the landscape of those properties.

The government also introduced evidence that Ward operated as an automobile broker for

one of the cocaine wholesalers. On one occasion in 1989, for instance, Ward purchased a $32,000

Cadillac automobile for the mother of one cocaine wholesaler. Ward received cash for the

automobile from the cocaine wholesaler and then converted the cash into cashier's checks—all in

amounts less than $10,000. Ward purchased the automobile in his own name, and then later

transferred title to the cocaine wholesaler's mother. At trial, the cocaine wholesaler testified that he

paid Ward $1,000 as a commission for purchasing the automobile. Ward also purchased a number

of other high-priced automobiles at the direction of the cocaine wholesalers, often keeping the

automobiles titled in his own name even though they actually belonged to various cocaine

wholesalers.

ISSUES

We discuss two issues: (1) whether sufficient evidence supports the Highs' convictions on
Count One for conspiracy to distribute and possess with intent to distribute cocaine, and aiding and

abetting a conspiracy, and (2) whether the district court's erroneous instruction on the elements of

the structuring offense in the multiple-object conspiracy of Count Thirteen warrants a reversal of

the appellants' convictions on that count.

DISCUSSION

A. Sufficiency of the Evidence on the Count One Charge

Whether sufficient evidence supports the Highs' convictions on Count One is a question of

law we review de novo. United States v. Massey, 89 F.3d 1433, 1438 (11th Cir.1996), cert. denied,

--- U.S. ----, 117 S.Ct. 983, 136 L.Ed.2d 865 (1997). In so doing, we review the evidence in the

light most favorable to the government and resolve all reasonable inferences and credibility

evaluations in favor of the jury's verdict. We will uphold the jury's verdict if a reasonable factfinder

could conclude that the evidence establishes the Highs' guilt beyond a reasonable doubt. United

States v. Starke, 62 F.3d 1374, 1380 (11th Cir.1995). To sustain a conspiracy conviction, we must

conclude that a reasonable factfinder could determine that (1) an agreement existed among two or

more persons; (2) that the defendant knew of the general purpose of the agreement; and (3) that the

defendant knowingly and voluntarily participated in the agreement. United States v. Ramsdale, 61

F.3d 825, 829 (11th Cir.1995). Because a conspiracy is generally secretive, a reasonable factfinder

may infer its existence from the surrounding circumstances. United States v. Simon, 839 F.2d 1461,

1469 (11th Cir.), cert. denied, 487 U.S. 1223, 108 S.Ct. 2883, 101 L.Ed.2d 917, and cert. denied,

488 U.S. 861, 109 S.Ct. 158, 102 L.Ed.2d 129 (1988). When, as here, a conspiracy conviction may

be based on an aider and abettor theory of liability pursuant to 18 U.S.C. § 2, the evidence must

show that the conspiracy occurred, and that "the defendant associated himself with a criminal

venture, participated in it as something he wished to bring about, and sought by his actions to make

it succeed." United States v. Bryant, 671 F.2d 450, 454 (11th Cir.1982).

The Highs contend that the government failed to present evidence that they knew about the

conspiracy to distribute and possess with intent to distribute cocaine, and voluntarily joined the

conspiracy. According to the Highs, the conspiracy had three objectives: (1) to acquire cocaine for
the purpose of distribution; (2) to acquire property as fruits of an unlawful scheme to distribute

cocaine; and (3) to conceal the wealth derived from the distribution of cocaine through the use of

false and fictitious names. The Highs contend that no evidence existed showing that Virginia High

was involved with the cocaine or assisted the cocaine wholesalers in using false and fictitious names.

The Highs also contend that no evidence existed that establishes a substantial link between George

High and the drug conspiracy. The Highs further contend that any services that they provided that

helped the cocaine wholesalers acquire property cannot constitute evidence of their participation in

the conspiracy, as those services only potentially constitute evidence of money laundering—which

was allegedly not an objective of the drug conspiracy described in Count One of the indictment.

The government counters that sufficient evidence existed to find the Highs guilty of the

offense alleged in Count One of the indictment. The government contends that the Highs knew the

illicit source of the cocaine wholesalers' money and voluntarily helped them fulfill objects of the

conspiracy, which included laundering the proceeds of the cocaine sales in order to ensure the

continued success of the cocaine distribution network. The government concedes that the Highs did

not possess drugs, but contends that this is irrelevant, as the evidence showed that the Highs knew

the illicit source of the money they received and invested that money in real estate on the cocaine

wholesalers' behalf.

Upon review of the facts and evidence, we agree with the government that sufficient

evidence existed to find the Highs guilty on Count One. At trial, the government presented

circumstantial evidence that showed the Highs knew the source of the cocaine wholesalers' money

and with that knowledge, continued to funnel their money, derived from unlawful activities, through

High Realty. Ample evidence demonstrated that the Highs voluntarily assisted the cocaine

wholesalers in investing money in real estate. This evidence showed that the Highs purposefully

aided the cocaine wholesalers in their efforts to acquire property, and that the Highs helped the

cocaine wholesalers conceal wealth using Virginia High's name on a deed for a residence that a

cocaine wholesaler actually owned.

The unambiguous language of the indictment belies the Highs' contention that money
laundering was not an alleged objective of the drug conspiracy described in Count One of the

indictment:

Further, it was an object of the conspiracy that the coconspirators would conceal the wealth
derived from the trafficking in cocaine ... and their use and ownership of instrumentalities
of the crimes, including real property ... and United States currency, through the use of false
and fictitious names, and otherwise.

(Emphasis added.) Moreover, to the extent that the Highs argue that money laundering activity

cannot be a basis for establishing culpability in a drug conspiracy, that contention is meritless. In

United States v. Bollinger, we held that a defendant involved only in the money laundering facet of

the drug business could be considered a part of the conspiracy to distribute those drugs. 796 F.2d

1394, 1407-08 (11th Cir.1986), modified on other grounds, 837 F.2d 436 (11th Cir.), cert. denied,

486 U.S. 1009, 108 S.Ct. 1737, 100 L.Ed.2d 200 (1988). The holding we set forth in Bollinger

simply means that a money launderer may be held liable as a principal or aider and abettor of a drug

conspiracy even though the money launderer's conduct takes place after the actual drug distribution

activity. The rationale underlying our holding is based on a recognition that money laundering often

ensures the success of the underlying substantive crime, drug trafficking. See United States v. Perez,

922 F.2d 782, 786 (11th Cir.) (money laundering can be an integral part of certain drug distribution

conspiracies) (citation omitted), cert. denied, 501 U.S. 1223, 111 S.Ct. 2840, 115 L.Ed.2d 1009

(1991).

Given the more than sufficient evidence establishing the Highs' guilt regarding the charges

in Count One of the indictment, we affirm their convictions on that count.

B. Effect of the Flawed Jury Instructions on the Count Thirteen Conviction

The second issue we address is whether the district court's erroneous instruction on one

object of an offense in the multiple-object conspiracy of Count Thirteen warrants a reversal of the

appellants' convictions on that count.

The district court's jury instruction regarding Count Thirteen required the government to

prove beyond a reasonable doubt that appellants conspired to commit one of the offenses that was

an object of the alleged conspiracy. These offenses included conspiracy to launder drug proceeds,

in violation of 18 U.S.C. § 1956; structuring currency transactions to avoid the filing of currency
transaction reports, in violation of 31 U.S.C. § 5324; and defrauding the United States, in violation

of 18 U.S.C. § 981. The district court further instructed that the jury had to agree unanimously upon

the offenses the appellants conspired to commit. Because the three offenses described in Count

Thirteen are substantive offenses in their own right, the district court also separately instructed the

jury on the essential elements of those offenses. The district court instructed the jury regarding the

structuring currency transactions offense, 31 U.S.C. § 5324, in accordance with our holding in

United States v. Brown, 954 F.2d 1563 (11th Cir.), cert. denied, 506 U.S. 900, 113 S.Ct. 284, 121

L.Ed.2d 210 (1992). The government concedes that this instruction was improper in the wake of

the Supreme Court's decision in Ratzlaf v. United States, 510 U.S. 135, 114 S.Ct. 655, 126 L.Ed.2d

615 (1994), decided during the pendency of this case.

Appellants all contend that their convictions on Count Thirteen must be reversed, because

the structuring currency transactions instruction was incorrect as a matter of law.3 They assert that

where one object of a multiple-object conspiracy charge has no support as a matter of law, a

conviction on the multiple-object conspiracy charge cannot be sustained. The government contends

that reversal is not required, as the district court's general jury instruction on the multiple-object

conspiracy was correct, curing any defect in the instruction regarding one of the alleged objects of

the conspiracy.

We agree with the appellants that reversal is appropriate based on the facts of this case. The
district court gave the following general instructions regarding the multiple-object conspiracy

charged in Count Thirteen:

[W]ith regard to the conspiracy alleged in count thirteen, the indictment charges that the
defendants conspired to commit various violations of the law of the United States such as
set out in Title 18, United States Code, Section 371. It is charged, in other words, that the
defendants conspired to commit three separate substantive crimes or offenses.

In such a case it is not necessary for the government to prove that the defendant
under consideration willfully conspired to commit all of those substantive offenses. It would

3
Counsel lodged a timely objection to the district court's instruction, obviating the need for
review under the "plain error" standard in this case. Accordingly, we review the district court's
instruction for "abuse of discretion." Any reliance the government places on the holding in
United States v. Vazquez, 53 F.3d 1216 (11th Cir.1995)—which addresses the impact of an
unobjected-to Ratzlaf error under "plain error" review—is thus misplaced.
 be sufficient if the government proved beyond a reasonable doubt that the defendant under
consideration willfully conspired with someone to commit one or both [sic] offenses.

But in that event, in order to return a verdict of guilty, you must unanimously agree
upon which of the three offenses the defendant conspired to commit.

The district court then gave the following specific instruction regarding structuring currency

transactions in violation of 31 U.S.C. § 5324(3):

I charge you that the government need not prove the defendant was aware of the
illegality of money structuring in order to convict the defendant of that offense under Title
31, United States Code, Section 5324(3).

This specific instruction was incorrect, as the Supreme Court held in Ratzlaf that a defendant may

be convicted of violating section 5324 only upon a showing that the defendant "willfully" violated

anti-structuring laws. 510 U.S. at 136-38, 114 S.Ct. at 657. According to the Court, the government

must "prove that the defendant acted with knowledge that his conduct was unlawful" in order to

prove a "willful" violation of section 5324. 510 U.S. at 137, 114 S.Ct. at 657. In other words, the

Court's Ratzlaf opinion required the district court in this case to instruct the jury that the government

needed to prove the defendant was aware that money structuring was illegal.

In our view, the district court's statement in the conspiracy instruction regarding the

necessity of "willful" action did not cure its specific, erroneous instruction concerning the

irrelevancy of proof of "willfulness" as to knowledge that structuring is illegal. It may be that the

jury understood the conspiracy instruction to require the government to prove that the appellants

willfully conspired to structure currency transactions. The jury however, may have understood the

conspiracy instruction to require a showing of willfulness with respect to the money laundering or

defrauding offenses, but not with regard to awareness that money structuring is illegal. Therefore,

the jury may have convicted the appellants of conspiring to engage in structuring currency

transactions without finding that they were aware that such structuring was illegal. As stated, such

a conclusion would run afoul of Ratzlaf.

While it is true that the jury might have agreed unanimously to convict the appellants of

conspiring to commit another offense, e.g., money laundering, that possibility alone is insufficient

to justify an affirmance. See Griffin v. United States, 502 U.S. 46, 52, 112 S.Ct. 466, 470-71, 116
L.Ed.2d 371 (1991) (where one of two objects of a conspiracy charge is insufficient as a matter of

law "the proper rule to be applied is that which requires a verdict to be set aside in cases where the

verdict is supportable on one ground, but not on another, and it is impossible to tell which ground

the jury selected") (citation omitted); United States v. Martinez, 14 F.3d 543, 553-54 (11th

Cir.1994) (the existence of an alternative theory upon which a conviction may be based does not

save a legal defect in the jury instructions); United States v. Boots, 80 F.3d 580, 589 (1st Cir.)

(reversing section 371 multiple-object conspiracy conviction where court erred in instructing jury

on one alleged object of conspiracy "because it is impossible to tell which ground the jury based the

conspiracy conviction upon"), cert. denied, --- U.S. ----, 117 S.Ct. 263, 136 L.Ed.2d 188 (1996);

see also United States v. Range, 94 F.3d 614, 620 (11th Cir.1996) ("A court must ... be able to

determine with absolute certainty that the jury based its verdict on the ground on which it was

properly instructed.") (quotations and citation omitted).

Accordingly, we must reverse the appellants' convictions on Count Thirteen of the

indictment.

CONCLUSION

Because the evidence was sufficient, we affirm the Highs' convictions on Count One.

Because we cannot determine whether the jury convicted the appellants on a legally sufficient basis

on Count Thirteen, we reverse the convictions of the appellants on that count and remand for further

proceedings consistent with this opinion.

AFFIRMED in part; REVERSED and REMANDED in part.