The Sixth Circuit has long interpreted the drug-conspiracy statute, 21 U.S.C. §846, to prohibit two individuals from knowingly reaching an agreement to distribute drugs. Crimes charged under this statute have long been the bane of any federal criminal defense attorney’s existence due to the extremely broad range of conduct the statute has been deemed to cover. More often than not, the conspiracy reaches out with its long arms to give the drug kingpin at the top of the indictment and the person who was once paid 50 bucks to drive said kingpin to a meeting the same jurisdictional embrace. For this reason, attacking what actions actually constitute participation in the conspiracy has long felt like tilting at windmills. Indeed, the 6th Circuit has opined that its traditional broad reading of the statute could be read to cover literally every drug transaction between a willing seller and a willing buyer, even those for the buyer’s personal use.

               Yet every federal appellate court including the 6th Circuit has carved out a narrow exception to the broadly read statute. These courts have all held that a “buyer-seller agreement” alone will not establish the elements of a conspiracy under §846. Putting it another way, the simple sale (or transfer) of drugs from one person to another with nothing more will not be deemed to be a conspiracy to distribute drugs. Even so, arguing that a drug transaction between two parties who are clearly not end users is a buyer-seller agreement has often felt like an uphill battle. Rather, if the allegations suggest that the buyer had any inkling to do something with the drugs other than immediately begin consuming them, that transaction alone has often been treated as de facto evidence of a drug conspiracy against both the buyer and the seller.

That’s what makes the reversal in United States vs. William Wheat, Jr., 19-4172, all the more remarkable. In overturning Wheat's conspiracy conviction, the 6th Circuit found that the transfer of drugs from one of the parties to the other without any further evidence of an agreement to distribute drugs did not constitute a conspiracy. Rather, this evidence only sufficed to establish the buyer-seller agreement. This was the case even though the evidence did establish that both parties were active participants in the drug trade. 

               Let’s start with the facts of the case. William Wheat was charged with six other codefendants in an 18-count indictment. Wheat himself was named in two of the counts, one of which was a conspiracy to possess with intent to distribute and to distribute 100 grams of heroin and 40 grams of fentanyl. Wheat was not the operator of this drug-distribution scheme, however. That distinction fell to one Aaron Reels. As noted by the Court, Reels operated a substantial drug-trafficking ring that sold cocaine, heroin and fentanyl in Cleveland. His operations involved multiple suppliers and multiple kilos of drugs. Wheat, on the other hand, appeared to be what can be charitably called an independent entrepreneur. Wheat and Reels were barely acquaintances when these allegations unfolded.

               On a phone call, Wheat briefly indicated to Reels that he had gotten hold of some heroin that Reels may have been interested in purchasing. The next day, Wheat met with and gave a .3 gram sample of heroin to Reels. After they parted, Reels gave the sample to his “royal taster”, Carl Mileca, in order to determine its quality. Reels ultimately decided that he had enough heroin in stock and did not need to purchase any product from Wheat. That was the extent of the interaction Reels and Wheat had with one another.

               Meanwhile, Reels had already been the target of an investigation by the DEA. Through wiretaps, the DEA learned that Wheat offered the .3 grams of heroin to Reels to do with as he saw fit in the hopes that Reels would be interested in purchasing more. The DEA further understood that Reels gave the sample to his tester to try out but opted not to purchase from Wheat.

               While all the other defendants pleaded guilty, Wheat went to trial. The jury found him guilty on both counts, and Wheat was sentenced to an above-guidelines 27-month term of imprisonment. As it pertained to the conspiracy count, the question that ultimately came before the 6th Circuit appeared to be a simple one: did Wheat’s decision to give a heroin sample to a known drug dealer show that he entered into an agreement to distribute drugs with the dealer under 21 U.S.C. §846? Despite this simplicity, the Court took the opportunity to take a nuanced deep-dive into the rationale of the buyer-seller agreement exception.

               First, the Court examined the basic requirements of the conspiracy statute as it applies to §846. Boiling it down to the basics, the Court reaffirmed that the government must show that two or more individuals have agreed to violate a drug law and that the defendant knowingly and voluntarily entered into the agreement. After remarking that conspiracy is an inchoate offense (that is, the underlying offense need not have been completed), the Court then spent some time examining the theory barring this type of agreement. The Court cited the traditional theory that “the banding together of two or more persons and a pooling of their talents and resources” increases the risk that the conspirators will commit other crimes. Importantly, the Court reemphasized that the crime is the agreement itself, and not the illegal act for which the agreement was made. The agreement need not be recorded or even spoken aloud, but it must exist, and the government must show that the defendant knew of the agreement’s “essential object” and agreed to carry out that object.

               Next, after rehashing the general tenets of the conspiracy statute, the 6th Circuit then took its own closer look at the buyer-seller agreement exception. The Court found justification for the buyer-seller exception within the text of §846 itself. That particular statute actually uses the common-law word, “conspire”. A common-law conspiracy, in turn, cannot exist if the agreed upon crime requires two people to complete it (thanks, Wharton’s Rule). In the case of a drug transaction, there are necessarily two (or more) parties, the giver of said drugs and the taker of said drugs. The Court thus found the buyer-seller exception to fall squarely within this construction, and a conspiracy could not exist solely based on a transfer of drugs from one party to another.

The Court did explain, however, that the exception was very narrow, and it further went on to name a number of scenarios which would constitute a conspiracy. The Court also identified several additional factors that the Government could establish with direct or circumstantial evidence which would allow a jury to find a conspiracy had been established. For instance, a buyer’s repeated purchase of a large quantity of drugs from a seller could be used to infer a broader agreement. A particular method of payment such as “fronting” drugs could potentially establish the conspiracy. An established level of trust coming from an “enduring arrangement” over time could also perhaps show the existence of an agreement beyond a simple transfer. These were just several of the factors the Court pointed to in its opinion.

               Applying this exhaustive analysis here, the Court found that Wheat’s conspiracy conviction could not stand. Had the government charged Wheat with a distribution charge under §841, it would have had a sure-fire conviction on its hand, but alas, Wheat was never charged for the actual transfer of the .3 grams.

               The government argued that Wheat’s actions constituted an agreement to sell heroin to Reels in the future. The Court disagreed, finding that while Wheat’s actions may have constituted a negotiation for future drug business, it did not constitute an agreement to do business. In doing so the Court offered what will now forever be dubbed the Great Costco Taquito Axiom:

“It is not all that unlike Costco offering customers, say, a free taquito sample. Would anyone infer (beyond a reasonable doubt, no less) that a customer has agreed to buy a bulk package of taquitos merely from the decision to try the sample?”

The Court also took note that the Government offered no evidence that an agreement to sell to Reels was conditioned on the quality of Wheat’s sample.

               The Government further argued that Wheat and Reels agreed to redistribute the sample to Reels’s tester, Mileca. This argument would allow the Government to steer clear of the buyer-seller exception because in this scenario, Wheat and Reels would have agreed to a crime separate from their own illegal transfer. The Court rejected this theory as well because the Government offered no evidence that Wheat and Reels expressly agreed that the sample would be tested by a third party nor that the two had a tacit understanding that this would happen.

               The Court then checked for other tell-tale signs of a conspiracy. Had Reels made repeated purchases of large quantities of drugs from Wheat? No. Did the method of payment for the .3 grams of heroin suggest a level of trust between the two? No dice. Was there any kind of long-term arrangement the two had with one another? That’s a negative, Ghost Rider.  

               Why then did this conviction happen? The Court speculated that based on the jury instructions provided to them, the jury perhaps thought the conspiracy proven if it found that Wheat and Reels knowingly agreed to transfer the sample from one to the other. That is, while the jury received the basic definition of a conspiratorial agreement, it received no instruction that the exchange of the sample did not itself suffice to prove the conspiracy. Presumably, defense practitioners should be asking for an instruction of the sort in the future if they are not already doing so.

               The Court concluded its analysis of the conspiracy charge by citing the decades-long concern about the “elastic, sprawling” nature of the crime of conspiracy and “the growing habit to indict for conspiracy in lieu of prosecuting for the substantive offense itself[.}" In reinvigorating the buyer-seller agreement exception, the 6th Circuit has reaffirmed that the Government must prove that two parties must agree to a crime beyond their own exchange of drugs in order to distinguish an illegal conspiracy from an illegal distribution to ensure that the jury will not infer a conspiracy based on guilt of distribution alone.

Soma Dutta

Assistant Federal Public Defender

Southern District of Ohio

1 comment:

samuelrobinson3 said...

This is very helpful. Thanks very much for posting.

Sam Robinson
Panel Attorney
Eastern District of TN