STEVENS, Circuit Judge.
Appellant participated in three purchases of stolen Cadillacs. A jury found him guilty on three substantive counts charging violations of the Dyer Act and on a conspiracy count charging that he and six other defendants were members of a single conspiracy to dispose of stolen motor vehicles moving in interstate commerce.
A government agent testified that appellant told him that all three Cadillacs had been obtained from John Dennis, a name which appeared on one of the New York title registrations. Maltese testified that defendant Altvare was present when he purchased one car from appellant and that appellant had introduced Altvare "as being the man that he got the car from."
This evidence was sufficient to prove that appellant knew the Cadillacs were stolen. We reject appellant's argument that the testimony about "Red Book" values was inadmissible hearsay.
We may assume that the evidence which we summarized above would be sufficient to support a finding that appellant conspired with defendant Altvare to violate the Dyer Act. Plainly, however, it did not prove that appellant participated in a conspiracy with any of the other five co-defendants, or in the separate conspiracy between Altvare and those other defendants. Most of the government's evidence related to activities of Altvare, who, in cooperation with other defendants, disposed, or attempted to dispose, of five Cadillacs and a Buick through the so-called A&J used car lot. There is no evidence that appellant had any connection with any of those six vehicles or with the A&J lot. The two operators of that lot pleaded guilty and testified for the government. Their testimony related entirely to activities of Altvare and other co-defendants. Neither they, nor any other witness, implicated appellant in the sales made through A&J or gave any testimony implying that appellant knew about the A&J activities or that the A&J participants (other than Altvare) ever heard about appellant, let alone knew of his business transactions with Maltese and Altvare. We therefore agree without reservation with appellant's argument that the evidence was insufficient to establish his participation in the single overall conspiracy charged in the indictment.
It necessarily follows that appellant was entitled to have the jury instructed that evidence which related only to the A&J transactions was not admissible against him.
Of course, every variance is not fatal. In Berger the Court held that proof of two conspiracies instead of one was harmless, and in Kotteakos the Court held that proof of eight conspiracies instead of one was prejudicial. It is not correct, however, to interpret these cases as requiring the question of prejudice to be answered simply by counting the number of conspiracies proved. For it is clear that there are cases in which a variance involving only two conspiracies is sufficiently prejudicial to require reversal,
Nor do we believe that the fact that appellant objected to the two-conspiracy instruction tendered by the government constitutes a waiver of this plain error. The proposed instruction was not adequate because it would have permitted the jury to consider the A&J evidence admissible against appellant if the jury found one single overall conspiracy.
We conclude that the judgment on the conspiracy count must be set aside. We are not persuaded, however, that this error tainted the verdict on the substantive counts. The defect in the conspiracy conviction does not affect the joinder of substantive counts, see Schaffer v. United States, 362 U.S. 511, 80 S.Ct. 945, 4 L.Ed.2d 921; the evidence pertaining to the A&J lot was therefore properly before the jury. That evidence was relevant to the charges against appellant only to the extent that it shed light on Altvare's status as the probable source of the stolen cars. Altvare's status was of critical importance in the conspiracy count because he was the only defendant with whom appellant even arguably might have conspired. But Altvare's status was a matter of indifference in connection with the proof of appellant's guilt on the substantive counts. For there was ample proof that appellant knew the Cadillacs were stolen, regardless of whether or not Altvare played any significant part in appellant's purchases. Indeed, Altvare was not even named as a defendant in two of the substantive counts against appellant, and with respect to the third — the only substantive count charging both Altvare and appellant — the jury acquitted Altvare.
The judgment on Count I is reversed; the judgments on Counts IV, V and VII are affirmed.
SWYGERT, Circuit Judge (dissenting in part).
Regretfully I cannot agree with the decision reached by the majority in affirming the defendant-appellant's convictions on the substantive counts. The trial judge, in my opinion, committed an error which requires reversal in toto and a remand for a new trial. He either should have severed the defendant-appellant
As Judge Stevens demonstrates, the record clearly indicates there were two separate conspiracies, one involving Joseph Altvare, Judy Altvare, Gerald Altier, Adam Jung, Kenneth Getty, and Louis Solone in receiving and selling stolen motor vehicles moving interstate and a second involving only Joseph Altvare and Cecil Ray Johnson in receiving three different stolen motor vehicles. Since the indictment charged a single overall conspiracy among all the defendants and the case was tried on that basis, the court holds that the conviction of Johnson of the conspiracy cannot stand absent a cautionary instruction clearly delineating the two conspiracies and admonishing the jury not to apply evidence relating to one when considering the other. In respect to the substantive counts relating to Johnson, the majority holds that the evidence concerning the conspiracy with which Johnson was not involved did not spill over and taint the finding of guilt on those counts. I disagree.
Laying aside for the moment the question of prejudice and how it should be appraised, there is no question that there was a spillover. The spillover about which we are talking can best be demonstrated, I believe, by graphic illustrations, one when a single conspiracy is charged together with substantive counts and the other when, although a single conspiracy is charged along with substantive counts, two conspiracies are actually shown by the evidence, that is, this case.
In Illustration I a cautionary instruction telling the jury not to consider the evidence of the conspiracy when considering the substantive counts is unnecessary because the conspiracy evidence is relevant to the execution of the object of the conspiracy. A and B are engaged in a joint enterprise growing out of the conspiracy if they act together, or B and C are aiders and abettors conceptually, also the result of the conspiracy, if A acts alone. Cf. Pinkerton v. United States, 328 U.S. 640, 66 S.Ct. 1180, 90 L.Ed. 1489 (1946). In Illustration II a problem arises because the evidence relating to Conspiracy I does not have a joint enterprise or aider and abettor relationship with the substantive charges growing out of Conspiracy II. That relationship
Since the jurors in the case at bar heard evidence involving a conspiracy in which Johnson had no part, an impermissible spillover resulted as to the substantive crimes charged against him. The critical question then arises as to its prejudicial effect on the jury and what should have been done about it. Before dealing with the quantum of the prejudice emanating from the circumstances of this case, I shall first discuss what should have been done. Two courses were open to the trial judge. He could have granted a severance at the close of the Government's evidence or he could have given a cautionary instruction. He did neither. As to severance the Government should have known at the close of its evidence what it readily concedes now: that it had proved two separate conspiracies instead of one. The trial judge should have known it also because it was brought to his attention by the defendant's motion for severance.
But short of granting severance the judge had a duty to admonish the jury during his charge that it should disregard the evidence of the larger conspiracy in deciding the guilt or innocence of the defendant as to the substantive charges. Instead he gave the standard instruction covering the co-conspirator exception to the hearsay rule and then in discussing the substantive counts he merely told the jurors:
The latter instruction was totally inadequate to meet the problem which the irrelevant evidence and co-conspirator instruction presented.
The court holds that the trial judge should have told the jury not to use the evidence of one conspiracy when considering the existence of the other conspiracy. Given that holding, for exactly the same reasons a cautionary instruction was required to neutralize, if possible, the prejudicial effect of the extraneous evidence on the substantive charges against Johnson.
There is precedential authority for the position I advance. In United States v. Bentvena, 319 F.2d 916 (1963), thirteen defendants were charged and tried for conspiracy. Three were additionally charged with substantive offenses. The defendants, including the three charged with substantive offenses, were convicted on all counts. The Second Circuit reversed the conviction of the three not only because of lack of evidence as to their participation in the conspiracy but also because of the lack of a cautionary instruction with respect to the substantive counts. There the court said: "Proper cautionary instructions . . . can presumably limit the prejudicial effect of the evidence presented at the trial directed towards proof of the conspiracy." 319 F.2d at 955. The court concluded: "The jury charged with that duty could hardly have given their defense the same consideration after they were erroneously found to be narcotics conspirators as it would have had they been tried on the substantive counts alone. The mass of conspiracy evidence militated against their credibility and towards their guilt." 319 F.2d at 955.
The obverse situation existed in Schaffer v. United States, 362 U.S. 511, 80 S.Ct. 945, 4 L.Ed.2d 921 (1960). There seven defendants were charged with conspiracy. Three substantive counts were added to the conspiracy count charging various defendants with being the three main perpetrators of a scheme to transport stolen goods. The conspiracy count was dismissed at the close of the Government's case for failure of proof. The
Moreover, Mr. Justice Clark, speaking for the majority, recognized the possible prejudice and the need for a trial judge to consider a severance:
Thus Schaffer v. United States and United States v. Bentvena stand for the proposition that a cautionary instruction was required in the circumstances of the case before us.
For guidance in measuring the prejudice visited on the defendant Johnson, we must look to Kotteakos v. United States, 328 U.S. 750, 66 S.Ct. 1239, 90 L.Ed. 1557 (1946). There Mr. Justice Rutledge wrote extensively, in a different but analogous context, about prejudice emanating from inadmissible evidence, harmless error, and the function of appellate review. I quote in part:
But this does not mean that the appellate court can escape altogether taking account of the outcome. To weigh the error's effect against the entire setting of the record without relation to the verdict or judgment would be almost to work in a vacuum. Cf. United States v. Socony-Vacuum Oil Co., supra, 310 U.S.  at pages 239, 242 [60 S.Ct. 811, at pages 851, 853, 84 L.Ed. 1129]. In criminal causes that outcome is conviction. This is different, or may be, from guilt in fact. It is guilt in law, established by the judgment of laymen. And the question is not were they right in their judgment, regardless of the error or its effect upon the verdict. It is rather what effect the error had or reasonably may be taken to have had upon the jury's decision. The crucial thing is the impact of the thing done wrong on the minds of other men, not on one's own, in the total setting. Cf. United States v. Socony-Vacuum Oil Co., supra, 310 U.S. at pages 239, 242
There is no doubt that a large part of the total evidence submitted to the jury dealt with the conspiracy with which Johnson was not involved. For substantiation I need only refer to footnote 12 of Judge Stevens' opinion wherein he quotes from the Government's recital of that evidence. (It is important to note Judge Stevens' preface to the footnote: "A major part of the facts in the government brief summarized evidence which was not admissible against appellant, but which, under the court's instructions, the jury may have considered in finding him guilty of conspiracy.") On the other hand, the Government's evidence which pointed to Johnson's guilt of receiving three stolen automobiles and selling two of them, although disputed, could fully support a verdict of guilty if that evidence were considered independently. The trouble is that it is highly probable that it was not considered independently by the jury.
The bulk of the evidence dealt with the larger of the two conspiracies. As the case was tried on a single conspiracy theory, all phases of that alleged conspiracy were lumped together. The mass of evidence concerning unrelated criminal activities of others, especially Joseph Altvare, may have influenced the jury's decision that Johnson had knowledge of the fact that these automobiles were stolen. The instruction that the statements and acts of one defendant as a conspirator could be imputed to the other conspirators no doubt also helped to produce in the minds of the jurors a gestalt in which the substantive charges against Johnson were inextricably blended with the two conspiracies. Since neither the prosecution nor the judge did anything to disentangle the substantive charges from the mass of evidence — most of it totally irrelevant to those charges — so that they could be considered independently, there is little likelihood that they were so considered.
In this situation we should apply the criteria and admonitions contained in the quotation from Kotteakos v. United States. As appellate judges we might with justification decide from the record that the defendant was guilty. But that, as pointed out by Mr. Justice Rutledge, is not our function. Rather we must ask ourselves: Can we say with conviction that the jurors would not have decided differently had they not been subjected to the confusion which resulted from the way the indictment was drawn and the case was tried? I, as a member of the panel, do not have a firm conviction either way; admittedly,
But of equal importance is the observance of form as it relates to substance. Unless we are indeed confident that a trial error was harmless, should we not insist that criminal trials be conducted so as not to be faced with that perennial hard question: Does the end justify the means? If procedural requirements are waived simply because we as appellate judges believe from an examination of the record that a defendant is guilty in fact, then the safeguards erected for fair trials crumble swiftly.
Judge Stevens indicates that any harm done the defendant by the circumstances here was harmless. Judge Hastings concurs. I respectfully do not agree for the reasons I have stated.
Altier and Jung pleaded guilty before trial and testified as government witnesses; Johnson was found guilty on Counts I, IV, V, and VII; Joseph Altvare was found guilty on Counts I, III and VIII, but not guilty on Counts II and IV; the remaining defendants were acquitted. Johnson received a concurrent sentence of 120 days on each count. Only Johnson appeals.
18 U.S.C. § 2313 provides:
The "Red Book," published by National Market Reports for over 64 years, was admissible under the Market Reports and Commercial Publications exception to the hearsay rule. Rule 803(17) of Federal Rules of Evidence, Act of January 2, 1975, Pub.L. No. 93-595. While these Federal Rules were not in effect during Johnson's trial, they could be used as guidelines in making evidentiary rulings, as we said in United States v. McCarthy, 445 F.2d 587, 591 (7th Cir. 1971). See Curtis v. Schwartzman Packing Co., 61 N.M. 305, 299 P.2d 776, 778 (1956); Dearborn Motors Credit Corp. v. Hinton, 221 Miss. 643, 74 So.2d 739, 742 (1954); cf. Virginia v. West Virginia, 238 U.S. 202, 212, 35 S.Ct. 795, 59 L.Ed. 1272; Fennerstein's Champagne, 70 U.S. (3 Wall.) 145, 148, 18 L.Ed. 121; Fraser-Smith Co. v. Chicago, Rock Island & Pac. R.R. Co., 435 F.2d 1396, 1402 (8th Cir. 1971). See generally 6 Wigmore on Evidence § 1704 (3rd ed. 1940).
Nor do we believe the standard LaBuy "knowledge" instruction that "No person can intentionally avoid knowledge by closing his eyes to facts which prompt him to investigate," was erroneous for failing to instruct that guilt could not be predicated on mere negligence. See United States v. Grizaffi, 471 F.2d 69, 75 (7th Cir. 1972), cert. denied, 411 U.S. 964, 93 S.Ct. 2141, 36 L.Ed.2d 684.
Finally, Johnson argues that it was error to refuse to give the "two conclusions" instruction:
But since the trial judge adequately described the government's obligation to prove the defendant guilty beyond a reasonable doubt, the failure to give such an instruction is not reversible error. United States v. Maenza, 475 F.2d 251, 254 (7th Cir. 1973).
The record does not include a transcript of the conference on instructions; therefore, the nature of appellant's objections to the government's proposed instructions and the reasons why no alternate was given are not indicated by the record. The error would, of course, not have been preserved if it were not plain.