Formula 404

United States v. Mercado, No. 08-1017-cr (2d Cir. July 17, 2009) (Calabresi, Wesley, CJJ, Droney, DJ)

In this split decision, the court upheld the admission of Rule 404(b) evidence – prior firearms sales – on the issue of intent in a drug conspiracy trial. The majority did not delve too deeply into the facts; instead, it rather formulaically noted that the prior transactions showed how the relationship of trust between the defendant and his co-conspirator developed, and rebutted the defendant’s argument that his actions were the innocent acts of a friend. The court also found no error in the district court’s Rule 403 balancing.

Judge Droney dissented, giving a much more complete picture of the facts of the case. The charged conduct involved the defendant, Townsend, and his friends, Jones – a cooperating witness – and Winfree. On the day he was arrested, Townsend drove them on some errands, one of which was a stop for Jones to purchase cocaine, which Winfree had arranged. Jones then persuaded Townsend to go back to Townsend’s apartment, where Jones cooked the powder into crack.

Townsend was charged with a cocaine conspiracy, a crack conspiracy, and a firearms charge – there was a gun hidden in his car – but was convicted only of the cocaine charge.

The Rule 404(b) evidence was that three months before the drug transaction Jones – who was already cooperating with the government – made arrangements for Townsend to purchase a handgun, and that one month before the drug transaction Jones purchased a different handgun from him.

Judge Droney carefully deconstructed the proffered reasons for admitting the 404(b) evidence, and found them all lacking. As to “background,” he noted that “some particular aspect of the background or the relationship of mutual trust must be in issue and the proffered evidence must be particularly relevant to that issue.” He found none of those characteristics present here, since the charged drug conspiracy had “no similarity” to the prior gun sales, and Townsend’s role in the gun sales “was not offered to support a theory regarding his role in the drug conspiracy.”

The gun sales were also “not particularly relevant to the development of mutual trust between Jones and Townsend.” Townsend did not dispute that relationship, and admitted that he and Jones had known each other since childhood, had lived together for a time, and were very close at the time of the offense.

Judge Droney also found fault with the district court’s Rule 403 balancing, particularly since the court permitted the two guns themselves to be entered into evidence, which “likely contributed to the substantial prejudicial effect of the testimony regarding the gun sales. The impact of the handguns as full exhibits far exceeded their very low probative value.” Finally, he noted that the gun sales were initiated by Jones when he was already cooperating, further diminishing their probativeness as to Townsend’s intent to join in Jones’ later effort to purchase cocaine.

Judge Droney next found that both the limiting instructions and the final jury charge on the Rule 404(b) evidence were inadequate. They included “knowledge” as one of the issues on which the evidence could be considered, even though Townsend’s knowledge of Jones’ cocaine activity was not at issue at the trial. The district judge also cited an incorrect time period, potentially confusing the jury as to which acts or agreements could form the basis for the conspiracy conviction.

Finally, Judge Droney concluded that these errors affected the outcome, since the government had a weak case as to Townsend’s intent, the only disputed issue in the case. The primary evidence on that issue was the testimony of Jones, who was “hardly a credible witness.”