United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
June 18, 2004
FOR THE FIFTH CIRCUIT
Charles R. Fulbruge III
Clerk
No. 03-10515
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
ELDON FLYN SIMMONS,
Defendant-Appellant.
Appeal from the United States District Court
for the Northern District of Texas
Before JOLLY, HIGGINBOTHAM, and DeMOSS, Circuit Judges.
PER CURIAM:
Eldon Simmons appeals his conviction of conspiracy to fix
prices in violation of Section One of the Sherman Act.1 He
contends that the court erred by (1) denying his motion to sever,
(2) inadequately instructing the jury, and (3) admitting out-of-
court statements made by him and three government witnesses. We
affirm.
I
Auto Glass Center operated automotive glass stores throughout
Texas, and was originally owned by six shareholders, Richard Akin,
1
15 U.S.C. § 1.
Larry Vance, Jim Lupton, David Lupton, Eldon Flyn Simmons, and
James Kuhn. Simmons oversaw all the Auto Glass Center stores and
also ran American Glass Distributors, a wholesale auto glass
distributor owned by the Jack Riedinger family. Auto Glass Center
bought its glass exclusively from American Glass because Simmons
controlled Auto Glass Center.
By the end of 1997, Auto Glass Center had 12 stores in central
North Texas, all supervised by Vance, who reported to Simmons. At
that time, the auto glass market was “very cutthroat,” and Vance in
particular was known for aggressively cutting prices to take
business away from competitors. Auto Glass Center’s primary
competitor was A-1 Auto Glass, which was owned and operated by
Roger McDonald.
Auto Glass Center also had one store in the Lubbock area,
operating under the name Avenue H, whose manager was Angela Cuevas,
Akin’s sister. Like the North Texas area, the Lubbock market was
“very competitive.” Avenue H’s primary competitor was Crafton’s
Glass, which was owned and operated by Dale Crafton.
At the end of 1997, Auto Glass Center experienced major
changes: The Riedinger family bought the Luptons’ shares and
became one third owner of Auto Glass Center. Vance, the aggressive
price cutter, was fired, to be replaced by James Lukacs and Kuhn.
On January 1, 1998, Akin became CEO of Auto Glass Center, a role in
2
which he “supervised the supervisors” but still reported to Simmons.
In early 1998, Simmons initiated a series of meetings with
Auto Glass Center managers and McDonald of A-1. Simmons, Kuhn,
Akin, Lukacs, and McDonald attended the first meeting, where they
discussed “getting the price of glass up” and not competing for
employees and clients. Lukacs and McDonald later exchanged pricing
information, and, at a second meeting, Kuhn told McDonald that Auto
Glass Center would not undercut A-1. Simmons made sure that Akin
knew that this was the course of action he desired, and Kuhn and
Lukacs went to various store managers to inform them of the new
pricing arrangements. McDonald in turn sent a memorandum to all
his employees detailing the agreement.
Lukacs and McDonald began checking with each other on specific
accounts, asking each other to “correct” any undercut prices. At
a third meeting, Maureen Edwards, an A-1 supervisor and McDonald’s
“right-hand person,” discussed truck windshields, for which she
produced a new price list. Kuhn and Lukacs enforced these truck
windshield prices at Auto Glass Center stores.
In February, Crafton’s Glass lost a large account to Avenue H
after Cuevas quoted a significantly lower price. Cuevas contended
that the issue was service, not price, and that Crafton was cheaper
than Avenue H on many products. Akin supported his sister’s
argument, which angered both Simmons and American Glass salesman
Joe LaRoe. On February 26, Simmons fired Akin after Akin refused
to talk to Crafton about pricing. Cuevas taped conversations with
3
Simmons, Kuhn, LaRoe, and Crafton, who eventually agreed not to
compete on prices and employees. (Akin had advised Cuevas to buy
a tape recorder and take good notes.) Though she had exchanged
price lists with Crafton, Cuevas was wary of implementing what she
saw as an illegal price agreement and so, after failing to convince
Simmons to abandon the plan, she resigned.2
On April 8, Auto Glass Center sales representative Amanda
Brewer called on Freeman Pontiac Body Shop, which used Hudson’s
Auto Glass rather than Auto Glass Center, and pitched cheaper
prices. The owner of Hudson’s, Tim Hudson, got upset at Brewer for
violating his deal with Kuhn and Simmons. Brewer told Hudson that
she was only aware of the A-1 deal. After Hudson called Simmons,
Simmons told Lukacs to correct the problem and control his
workforce. Lukacs then told Hudson that Auto Glass Center would
not compete on price.
In early May, Simmons, Kuhn, and Lukacs met for a final time
with McDonald, who had called Simmons to discuss a breakdown in
their pricing plan that was caused by State Farm Insurance’s new
price schedule. McDonald indicated that he “wanted out,” but
Simmons attempted to coax McDonald “not to be quite so hasty . . .
things could still work out.” They continued to abide by their
2
In January 2000, Akin and Cuevas, both of whom were
government witnesses against Simmons, filed a wrongful termination
suit against American Glass and Auto Glass Center’s umbrella
corporation, Windshield Sales and Services, Inc., settling for
$258,330 each.
4
agreement. Shortly thereafter, on May 12, 1998, A-1 received a
federal grand jury subpoena.
On November 14, 2001, a grand jury indicted Simmons and Kuhn
on two counts of criminal antitrust violations pursuant to Section
One of the Sherman Act, 15 U.S.C. § 1. Count One charged them with
conspiring to fix the price of automotive windshield replacement in
North Texas from January 1998 until at least May 1998; Count Two
charged them with conspiring to fix prices in the same industry in
Lubbock, Texas, from March 1998 until at least May 1998.
On December 16, 2002, a jury returned a verdict of not guilty
as to Simmons on Count Two, but hung on the remaining counts,
prompting the district court to declare a mistrial. On February 7,
2003, Simmons filed a motion to sever, asking to be tried
separately. This motion was denied and Simmons was retried on
Count One, while Kuhn was retried on both counts. During the
second trial with the same presiding judge, Simmons renewed his
motion for severance and obtained the court’s permission for a
continuing objection whenever a witness testified as to Simmons’
involvement in the Lubbock conspiracy (Count Two). On February 21,
a jury returned guilty verdicts on all remaining counts.3
On May 23, the court sentenced Simmons to ten months’
imprisonment, a $75,000 fine, and one-year supervised release.
3
During both trials, various employees of Auto Glass Center
and A-1 testified as to having no knowledge of any price-fixing
agreements. Only the testimony of Simmons and Kuhn, however,
directly contradicted the facts as stated above.
5
That same day, Simmons filed a notice of appeal on three issues:
(1) the denial of his motion to sever following the first trial;
(2) the adequacy of the jury instruction at the second trial; and
(3) the admission in the second trial of certain out-of-court
recorded statements made by Simmons and three government witnesses.
II
We turn first to Simmons’ claim of error in the trial court’s
refusal to conduct separate trials. As a general rule, persons
indicted together should be tried together, particularly when the
offense is conspiracy.4 In ruling on a motion to sever, a trial
court must balance potential prejudice to the defendant against the
“public interest in joint trials where the case against each
defendant arises from the same general transaction.”5 To
demonstrate reversible error, even where initial joinder was
improper, a defendant must show “clear, specific and compelling
prejudice that resulted in an unfair trial.”6 This prejudice must
be of a type “against which the trial court was unable to afford
4
See, e.g., United States v. Pofahl, 990 F.2d 1456, 1483 (5th
Cir. 1993).
5
United States v. Kane, 887 F.2d 568, 571 (5th Cir. 1989).
6
United States v. Posada-Rios, 158 F.3d 832, 863 (5th Cir.
1998) (quoting United States v. Bullock, 71 F.3d 171, 174 (5th Cir.
1995)).
6
protection.”7 We review the denial of a motion to sever for abuse
of discretion.8
Simmons essentially argues that forcing him into a second
trial with Kuhn allowed the government to try again his complicity
in Count Two, the conspiracy of which he was acquitted in the first
trial. The argument continues that at the very least, the
testimony of Akin, Cuevas, and Crafton tied Simmons to Kuhn’s Count
Two activities, a “spillover” of evidence that prejudiced the
jury’s consideration of Count One. Relatedly, when confronted with
the testimony of government witnesses as to the Lubbock conspiracy,
trial counsel was “faced with a Hobson’s choice,” so as not to
place emphasis on an aspect of the indictment for which Simmons was
no longer at trial.
While we do not find this to be an easy question, we are
ultimately persuaded that refusing to sever was not reversible
error. In our decision we are keenly aware that the claimed
“efficiency” of a joint trial can be a surrogate for the reality
that a joint trial of multiple defendants is simply to the
advantage of the government. It is the potential presence of
7
United States v. Mann, 161 F.3d 840, 863 (5th Cir. 1998)
(quoting United States v. Arzola-Amaya, 867 F.2d 1504, 1516 (5th
Cir. 1989)).
8
United States v. Nutall, 180 F.3d 182, 187 (5th Cir. 1999).
See also United States v. McGuire, 608 F.2d 1028, 1031 (5th Cir.
1979) (noting that a court’s balance of potential prejudice against
the interest in judicial economy is “a consideration involving
substantial discretion”).
7
prosecutorial advantage distinct from the expense of duplicating
efforts that draws our attention. Hence, when a joint trial puts
evidence before the jury that would not be admitted against a
defendant tried separately, we closely examine that evidence, its
“spillover” potential, and whether a jury instruction to consider
it only against the defendant against whom it was admitted can be
truly effective.
Having cast a wary eye, we are persuaded that Simmons’
argument must fail. First, the evidence was “not so complicated
. . . as to prevent the jury from separating the evidence and
properly applying it only to those against whom it was offered.”9
Evaluating the complexity of evidence is necessarily a fact-
specific inquiry. Although both counts here involved fixing the
price of auto glass, they involved different witnesses, locations,
competitors, and time-frames. The district court did not abuse its
discretion in determining that the jury could have easily
distinguished between the two conspiracies.
Second, with the facts relatively easy to sort, the district
court’s jury instructions here provided adequate protection against
prejudice. The court explained the differences between the counts,
and used the instruction repeatedly approved by this Court as
offering sound efforts to protect against prejudice in a joint
9
United States v. Manzella, 782 F.2d 533, 540 (5th Cir.
1986).
8
trial.10 These instructions were given to protect Simmons from the
“spillover” evidence, to guard against the jury convicting Simmons
on Count One based on evidence related to Count Two.11 As for the
clarity of their statement, Simmons did not challenge the
instruction or request additions or modifications to it.
Third, Simmons simply did not suffer “clear, specific and
compelling prejudice.” As an initial matter, “the mere presence of
a spillover effect does not ordinarily warrant severance.”12 Here,
the direct evidence of Simmons’ guilt on Count One, including the
testimony by Akin, Lukacs, McDonald, and Brewer detailing the
formation and implementation of the North Texas price-fixing
10
Specifically, the district court instructed:
A separate crime is charged against one or more of the
defendants in each count of the indictment. Each count,
and the evidence pertaining to it, should be considered
separately. Also, the case of each defendant should be
considered separately and individually. The fact that
you may find one or more of the accused guilty or not
guilty of any of the crimes charged should not control
your verdict as to any other crime or any other
defendant. You must give separate consideration to the
evidence as to each defendant.
See, e.g., United States v. Bieganowski, 313 F.3d 264, 288 (5th
Cir. 2002); Pofahl, 990 F.2d at 1483; Posada-Rios, 158 F.3d at 863-
64.
11
See Bieganowski, 313 F.3d at 288 (“[B]ecause a jury is
presumed to follow the court’s instructions, instructions such as
those given here are generally sufficient to cure the possibility
of prejudice.”).
12
Pofahl, 990 F.2d at 1483. See also Bieganowski, 313 F.3d
at 287 (“A spillover effect, by itself, is an insufficient
predicate for a motion to sever.”).
9
agreement, makes the spillover effect “especially negligible.”
Further, able counsel are not without tools to assist in the effort
to cabin the bite of the spillover. Those skills were deployed
here. Simmons’ decision not to cross-examine the Lubbock-related
witnesses – and not to ask for more specific limiting instructions
– reflects counsel’s judgment call that the testimony did not so
inculpate Simmons that it was not manageable.
Although Simmons’ contention is not without purchase, we
ultimately conclude that Simmons fails to show sufficient prejudice
from which the district court was unable to protect him; that
denial of the motion to sever was not an abuse of discretion.
III
Simmons next urges that the district court failed to properly
instruct the jury. A district court retains “broad discretion” in
formulating jury instructions; we will not reverse “unless the
instructions taken as a whole do not correctly reflect the issues
and law.”13 While a defendant is entitled to an instruction on his
theory of defense, he has no right to particular wording.14 When
considering an appeal for failure to give defendant’s requested
defense theory instruction, we review “whether the court’s charge,
as a whole, is a correct statement of the law and whether it
13
United States v. McKinney, 53 F.3d 664, 676 (5th Cir. 1995).
14
United States v. Harrelson, 705 F.2d 733, 736-37 (5th Cir.
1983).
10
clearly instructs jurors as to the principles of law applicable to
the factual issues confronting them.”15
Simmons argues that the district court at the second trial
“gave substantially different instructions based on the same
evidence than [it] gave at the first trial,” and that the
differences prevented the jury from adequately considering Simmons’
defenses. The relevant portion of the jury charge at the second
trial was a condensed version of that given at the first trial.
This particular instruction explains how similar prices or pricing
policies are not prima facie evidence of conspiracy or price-fixing
arrangements.16 Simmons objects to the exclusion of certain
language stating, for example, that “[s]imilarity of competitive
business practices . . . may be consistent with ordinary
competitive behavior in a free and open market.” In other words,
15
McKinney, 53 F.3d at 676 (quoting United States v. Stacey,
896 F.2d 75, 77 (5th Cir. 1990)).
16
The instruction Simmons objects to reads as follows:
The fact that competitors may have charged identical
prices, copied each other’s price lists, conformed
exactly to another’s price policies, discussed prices,
obtained information about each other’s prices, or
exchanged information about prices does not establish a
violation of the Sherman Act unless they did any of these
things because of an agreement or arrangement or
understanding such as is alleged in the indictment.
Therefore, similarity or identity of prices charged
does not alone establish the existence of a conspiracy.
You may, however, consider these facts and circumstances
along with other evidence in determining whether there
was an agreement, arrangement, or understanding between
such competitors as alleged in the indictment.
11
Simmons argues, the lack of explicit instructions that Simmons’
behavior could be legal was serious error warranting reversal. The
argument is without merit.
Simmons’ defensive theory was that he and competitors in the
North Texas market “did have similarity of competitive practices
and had identical prices for the same goods and services, but not
as a result of an unlawful agreement or understanding.” And the
instructions – the one cited by Simmons and others relating to,
e.g., elements of the crime, scienter, agency, burdens of proof,
and definitions – repeatedly emphasized that a price-fixing
agreement, not any particular business practice, must be found in
order to convict. The specific instruction cited by Simmons as
being impermissibly modified from its equivalent at the first trial
itself correctly and clearly presented the idea that parallel
prices and practices alone do not establish a Sherman Act
violation. In altering the instruction from that given in the
first trial, the court simplified his earlier instruction.17
IV
Finally, Simmons urges that the district court abused its
discretion in admitting out-of-court statements of Simmons and
three government witnesses. We review a district court’s
17
Nothing precludes a district court from modifying,
condensing, or omitting parts of jury instructions after a mistrial
for purposes of the retrial. See, e.g., United States v. Williams,
728 F.2d 1402, 1406 (11th Cir. 1984).
12
evidentiary rulings for abuse of discretion.18 “The abuse of
discretion must create the likelihood of prejudice to the defendant
and the substantial right at issue must be made known to the
court.”19 Non-constitutional trial error is harmless unless it had
“substantial and injurious effect or influence in determining the
jury’s verdict.”20
Simmons claims that out-of-court statements were improperly
admitted as coconspirator statements under FED. R. EVID.
801(d)(2)(E).21 He also argues that these statements should have
been excluded under FED. R. EVID. 403 because their probative value
was far outweighed by their unfair prejudice.22 Specifically, he
argues that the testimony of Akin, Cuevas, and Crafton (and the
tape of a conversation between Cuevas and Simmons) relating to the
Lubbock conspiracy, should have been excluded (or been accompanied
by a limiting instruction) because Simmons had already been
18
United States v. Lowery, 135 F.3d 957, 959 (5th Cir. 1998).
19
Id.
20
Id. (quoting Kotteakos v. United States, 328 U.S. 750, 776
(1946)).
21
FED. R. EVID. 801(d)(2)(E) provides that a statement is not
inadmissible hearsay if it is offered against a party and is “a
statement by a coconspirator of a party during the course and in
furtherance of the conspiracy.”
22
FED. R. EVID. 403 provides that “[a]lthough relevant,
evidence may be excluded if its probative value is substantially
outweighed by the danger of unfair prejudice, confusion of the
issues, or misleading the jury, or by considerations of undue
delay, waste of time, or needless presentation of cumulative
evidence.”
13
acquitted of participation in that conspiracy. Simmons asserts
that, like the spillover effect he claims in his severance
argument, the presentation of the Lubbock evidence – which was
indisputably admissible with respect to Count Two against Kuhn –
“deprived [Simmons] of having the jury give a clear and focused
consideration of only the evidence relative to [his] activities [in
the North Texas conspiracy].”
A coconspirator’s statement should be admitted over objection
only on a showing that: (1) there is a conspiracy; (2) the
statement was made during the course and in furtherance of the
conspiracy; and (3) the defendant and declarant were members of the
conspiracy.23 The government correctly contends that Simmons’ prior
acquittal was no bar to its evidence that Simmons participated in
the Lubbock conspiracy for purposes of admitting coconspirator
statements.24 Further, the out-of-court statements Simmons
questions were his own and were made while talking to the
government witnesses. As a result, to the extent they are
incriminatory, the statements are also admissible under Rule
801(d)(2)(A) (“the party’s own statement”) and the witnesses’
23
United States v. James, 590 F.2d 575, 578 (5th Cir. 1979)
(en banc).
24
See United States v. Brackett, 113 F.3d 1396, 1400-01 (5th
Cir. 1997). See also United States v. Gonzalez, 700 F.2d 196, 203
(5th Cir. 1983) (trial court in criminal conspiracy prosecution has
discretion to determine application of James ruling as prerequisite
to admitting coconspirator’s statement); United States v. Ricks,
639 F.2d 1305, 1309-10 (5th Cir. 1981) (explaining the great
flexibility a district court has in hearing evidence on preliminary
facts for admission of coconspirator statement).
14
portions of the conversations are necessary context.25
Moreover, they are not clearly inculpatory, and it is also not
clear that they were offered to prove the truth of the matter
asserted, rather than as verbal acts or to show motive, state of
mind, or bias.26 What is clear is that the statements were all
relevant to a proper understanding of Kuhn’s role in the Lubbock
conspiracy. Thus, their probative value was not “substantially
outweighed by the danger of unfair prejudice.”
In any event, other government witnesses and documentary
evidence provided overwhelming direct and circumstantial evidence
of Simmons’ participation in, and leadership of, the North Texas
conspiracy. This evidence, combined with adequate instructions
that the jury was to treat the conspiracies and defendants
separately, at worst leaves no reversible error.
V
For these reasons, we AFFIRM.
25
See Brackett, 113 F.3d at 1400-01; see also, e.g., United
States v. Flores, 63 F.3d 1342, 1358-59 (5th Cir. 1995).
26
For example, Kuhn’s counsel introduced the recording of the
Simmons-Cuevas conversation to show that Cuevas had misunderstood
Kuhn’s instructions to her, while Akin’s testimony went (at least
in part) to explain the circumstances leading up to Akin’s
termination and refute implications of bias. Similarly, Crafton’s
testimony was introduced to show that Simmons had received a
complaint from Crafton rather than to prove the truth of that
complaint.
15