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Neil H. Jaffee, Assistant Federal Public Defender, argued the cause for appellant. With him on the briefs were A. J. Kramer, Federal Public Defender, and Jennifer M. Blunt, Assistant Federal Public Defender. Evelina J. Norwinski, Assistant Federal Public Defender, entered an appearance.
Elizabeth H. Danello, Assistant U.S. Attorney, argued the cause for appellee. With her on the brief were Wilma A.
Lewis, U.S. Attorney, and John R. Fisher, Assistant U.S. Attorney.
The defendant in this case, Cornell Evans, was convicted of multiple felonies relating to the possession and distribution of illegal narcotics. The principal issue on appeal concerns the testimony of an FBI agent who stated at trial that the government "had received information" that defendant was involved in drug trafficking. Defendant contends that this testimony was hearsay and that its admission was erroneous. Defendant is correct. We conclude, however, that the error was harmless, and therefore affirm his convictions.
* This case arose out of an undercover narcotics operation conducted by the Federal Bureau of Investigation. In the fall of 1996, special agents of the FBI met with Thomas "Tee" Rose, a former District of Columbia resident who was serving a federal prison sentence at the Fairton Correctional Institution and who had two additional state cases pending against him. The agents agreed to help Rose with his sentence and pending charges in return for his assistance in the investigation of other crimes. Thomas Rose told the agents that defendant Evans was involved in drug trafficking, and he referred them to his uncle, George Rose of Pennsylvania, who agreed to assist the FBI provided that his incarcerated nephew would receive the benefit of his cooperation.
George Rose contacted the defendant by telephone in early March 1997. In that and subsequent conversations, all taped by the FBI, Rose arranged to purchase crack cocaine from Evans at a barber shop where Evans worked. The subject of drugs first arose when Rose complained that " [t]he quality of stuff" in Pittsburgh was "terrible." Evans then said: "I got a few people I can talk to ... depending on what you want."Defendant noted that the "going price was forty-five for an eighth" but that there was a shortage, so prices were rising. He agreed to look into current prices, and in a series of further calls the two worked out the details of the transaction. On March 18, 1997, Rose met Evans outside the barber shop and gave him $1,800 in cash for 62 grams of crack. The purchase was captured on tape by a body recorder worn by Rose and on film by FBI surveillance cameras.
Ten days later, George Rose telephoned Evans and the two discussed another drug transaction. On April 1, 1997, Rose again met Evans at the barber shop, where he purchased approximately 124 grams of cocaine powder for $3,600. As before, Rose wore a body recorder that taped the transaction.Rose tried to arrange a third transaction on April 23, but Evans said that his drug supply had dried up.
The FBI arrested Evans more than a year later, on October 13, 1998. In a search incident to the arrest, agents discovered four small bags of cocaine powder rolled up in Evans' pants leg. After waiving his Miranda rights, defendant admitted the March 18, 1997 transaction but claimed not to remember the subsequent deal on April 1. He told the agents that "Tee" had called him from jail and asked him to "show around" his uncle, George Rose. He said that George Rose had then contacted him and expressed an interest in obtaining cocaine, and that he had agreed to help Rose out.According to Evans, someone in the barbershop whom he did not know had given him the names of two people who could supply him with cocaine. Evans then contacted those people, whose names he also did not remember. The suppliers brought the drugs to Evans at the shop, where he delivered them to Rose. Evans said that he had provided the drugs "as a favor to Tee and George Rose." 2/4/99 a.m. Tr. at 80.
Evans was charged with unlawful use of a communications facility, distribution of cocaine and cocaine base, and possession of cocaine. The case went to trial on February 4, 1999, and defendant was convicted on all counts.
On appeal, Evans raises four challenges to his convictions and sentence. Of these, only one merits considerable attention: Evans' claim that the district court committed reversible error by admitting certain government testimony into evidence. We address that contention first, beginning with a recitation of the relevant facts.
* The government's first witness at trial was FBI Special Agent Neil Darnell. After Darnell testified about the origins of the undercover operation, including the FBI's contact with Thomas Rose and George Rose's agreement to cooperate, the prosecutor asked the agent how he "came about knowing Mr. Evans." 2/4/99 a.m. Tr. at 26. Defense counsel objected on the ground that the question necessarily called for hearsay as to what Thomas Rose had told the FBI. The defense emphasized that Rose was not a witness and would not be available for cross-examination. In response, the prosecutor argued that the evidence was not hearsay because it was only offered "to establish where the FBI met with George Rose and why they did what they did with George Rose." Id. The district court overruled the objection.
The prosecutor resumed his questioning by asking Darnell why he had specifically discussed Evans with George Rose. Agent Darnell answered: "We had received Mr.--or information that Mr. Evans was involved in drug trafficking and--." Id. at 27. Defense counsel interrupted with an objection, which was again overruled. Agent Darnell then added: "And Mr. Rose was in a position to directly go in and approach Mr. Evans about narcotics." Id. The prosecutor then asked whether the FBI's "information" had come from Thomas Rose, and Darnell answered that it had. The court sustained an objection to this question and answer, and directed the jury to disregard the latter.
Shortly thereafter, the defense requested a bench conference and moved for a mistrial based on the admission of Darnell's hearsay testimony that the FBI "had received information" that Evans was involved in drug trafficking. Counsel argued that the jury could infer that Thomas Rose was the one who had identified Evans as a drug dealer, that this made it appear more likely that Evans had committed the charged acts, and that Evans would be unable to cross-examine his accuser "because this guy is not going to be here to testify."Id. at 39-40. Again, the government argued that it had elicited the testimony not to prove the truth of the matter asserted, but rather "to prove why the FBI did what they did." Id. at 40. The court denied the mistrial motion without prejudice to its being renewed later in the proceedings. At the end of the government's case-in-chief, defense counsel renewed the motion, and the court made the same ruling.
Evans' defense consisted of the testimony of three witnesses, each of whom said they had never seen any indication that defendant distributed drugs, as well as Evans' testimony on his own behalf. On the witness stand, Evans admitted to his participation in the two charged drug transactions. He testified that Thomas Rose had told him that his uncle, George Rose, was coming to D.C. and had asked him to show George around. Evans said he had not expected George to ask him to supply drugs, but that he had been able to obtain some for him from sources whose names he did not remember. Evans maintained that the two transactions with George Rose were the only times he had ever distributed drugs, and specifically denied that he had ever sold drugs with Thomas Rose. He further stated that he had agreed to participate in the two sales because he and Thomas Rose "had a good friendship." 2/5/99 Tr. at 112; see also id. at 124.
The defense renewed its motion for a mistrial two more times--after it rested and at the close of all the evidence. In one colloquy, the court acknowledged that it "might have been a mistake to overrule the objection" to Darnell's testimony, but allowed the testimony to stand. 2/4/99 a.m. Tr. at 41.
In closing argument, defense counsel conceded Evans' participation in the two drug transactions. He argued, however, that defendant had been unlawfully entrapped into participating. Although the district court gave instructions regarding the entrapment defense, the jury returned a guilty verdict on every count.
Defendant contends that Agent Darnell's testimony that the FBI "had received ... information that Mr. Evans was involved in drug trafficking" was inadmissible hearsay--that is, "a statement, other than one made by the declarant while testifying at the trial ..., offered in evidence to prove the truth of the matter asserted." Fed. R. Evid. 801 (defining hearsay); see Fed. R. Evid. 802 (making hearsay inadmissible). We review this allegation under the abuse of discretion standard. See United States v. Clarke, 24 F.3d 257, 267 (D.C. Cir. 1994).
The problem with hearsay is that it deprives the defendant of the opportunity to cross-examine the person who uttered the statement at issue. Here, the government presented allegations of prior drug dealing, and the defendant was unable to cross-examine the person who made them. At the time of the testimony, that person--the less-than-reputable convict, Thomas Rose--was sitting in a federal correctional institution. Meanwhile in court, telling Rose's story, was the clean-cut FBI agent, Neil Darnell. Thus, Evans had no opportunity to "test [ ] the recollection and sift [ ] the conscience" of his accuser, nor could he compel him "to stand face to face with the jury in order that they [might] look at him, and judge by his demeanor upon the stand and the manner in which he [gave] his testimony whether he [was] worthy of belief." California v. Green, 399 U.S. 149, 158 (1970) (quoting Mattox v. United States, 156 U.S. 237, 242-43 (1895)). Cross-examination may be the "greatest legal engine ever invented for the discovery of truth," Green, 399 U.S. at 158, but it is not of much use if there is no one to whom it can be applied.
The government contends that Darnell's statements did not constitute hearsay because they were not "offered in evidence to prove the truth of the matter asserted." Fed. R. Evid. 801(c). That is, they were not offered to prove that Evans actually had been involved in drug trafficking. But if Darnell's testimony about the FBI's "information" did not go to the truth of that assertion, to what did it go? The trial prosecutor said he offered the testimony to establish "why they did what they did with George Rose." For testimony to be admissible for any purpose, however, it must be relevant.See Fed. R. Evid. 402. And to be relevant, it must have a "tendency to make the existence of [a] fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence." Fed. R. Evid. 401. How was "why they did what they did with George Rose" related to such a fact of consequence? Three possible, interconnected explanations can be inferred from the government's appellate brief and oral argument. We consider each in turn.
First, the government suggests that the testimony was relevant to show that Evans had not been improperly targeted or selectively prosecuted--that is, it was offered to show the state of mind of the FBI agents, rather than the truth of the allegations upon which their state of mind was based.While selective prosecution may qualify as an issue of consequence in some proceedings, see generally United States v. Washington, 705 F.2d 489, 494-95 (D.C. Cir. 1983), it was not an issue in Evans' trial. Defendant did not raise such an allegation through argument or testimony, nor did he "open the door" to the matter through inferences made during cross-examination. See United States v. Forrester, 60 F.3d 52, 60-61 (2d Cir. 1995); United States v. Reyes, 18 F.3d 65, 69-70 (2d Cir. 1994). Indeed, the hearsay at issue here was elicited during the direct examination of the government's first witness, before Evans had presented a case or even begun to cross-examine. Moreover, when Evans eventually did put on a defense, it was not selective prosecution but entrapment. Hence, why the agents did what they did--i.e., the agents' motives for investigating Evans--never became a fact of consequence to the determination of the action.
Approving the admission of Agent Darnell's testimony under these circumstances would open a large loophole in the hearsay rule. If we were to accept the government's rationale here, then explaining why government agents "did what they did" through reference to statements of absent informants would be acceptable in almost any case involving an undercover operation, and in many others as well. That is a loophole this circuit has previously refused to open.
We reject this argument. There was no issue as to the presence of [the defendant's] picture in the array, and there fore no occasion for any explanation. In any event, explanation of a photographic array cannot be allowed to repeal the hearsay rule.
Id.; see United States v. Freeman, 514 F.2d 1314, 1317 (D.C. Cir. 1975) (reversing conviction because, inter alia, police testimony recounting witness tip was hearsay and inadmissible to explain why police went to defendant's house), vacated on other grounds, 598 F.2d 306 (D.C. Cir 1979).1 The same response is warranted in this case.
The government's second relevance argument is that Agent Darnell's testimony was necessary to combat the threat of "jury nullification." We are not certain what the government means by this contention. If this is just another way of saying that the government did not want the jury to think it had engaged in selective prosecution, we have already addressed the point above. It appears, however, that the government may mean something more: that the testimony was necessary to ensure that the jury did not miss the context of the events and the moral significance of the allegations, and thus render an unjustified acquittal. It is true, of course, that as a general matter the prosecution is entitled to present the "whole story" of criminal misconduct in order to guard against just such an eventuality. See Old Chief v. United States, 519 U.S. 172, 186-89 (1997); United States v. Crowder, 141 F.3d 1202, 1207 (D.C. Cir. 1998) (en banc). But in presenting that story, the government is as much bound by the rules of evidence as it is on any other issue. No matter how important it is for the government to present a complete, morally compelling narrative, it must present that narrative through admissible evidence, not through hearsay.
Finally, the government contends that the evidence of "why they did what they did" was relevant as "background"-merely for the value of giving the jury a complete picture of the events in question. Sometimes courts excuse the use of hearsay evidence for background purposes where the evidence is on an uncontroverted matter, where hearsay is the most efficient means of transmitting it, and where there is little chance of prejudice to the defendant. See generally United States v. Gatling, 96 F.3d 1511, 1523-24 (D.C. Cir. 1996) (concluding that trial court's error in permitting witnesses to testify about prior statements by nonparty witnesses was "at most harmless" and served to "provide background"). But where those conditions are not met--as they are not here--the government must prove "background" the same way it would any other set of relevant facts.
The government correctly notes that when the "background" being offered is the state of mind of the police, it is technically not hearsay at all. See Gatling, 96 F.3d at 1524.Nonetheless, to be admissible it must still be relevant, and if "background" was related to a fact "of consequence to the determination" of this case, it was only barely so. Even the government concedes that the probative value of Agent Darnell's statement as background was "not significant." Br. for Appellee at 15.
Moreover, the use of that testimony to establish propensity was not the only danger in this case. As the trial judge properly instructed the jury, one element of the entrapment defense is a lack of predisposition on the part of the defendant to commit the crime. See United States v. Glover, 153 F.3d 749, 754 (D.C. Cir. 1998). Agent Darnell's statement could not permissibly have been used to establish predisposition, since the issue of predisposition goes to Evans' state of mind (why he did what he did with George Rose), not to that of the agents (why they did what they did with him). See United States v. Webster, 649 F.2d 346, 349-50 (5th Cir. 1981) (en banc). There was considerable risk, however, that the jury would use the agent's testimony in that impermissible way. Indeed, the prosecutor explicitly sought to use Darnell's testimony to establish Evans' predisposition in his closing argument. See 2/5/99 p.m. Tr. at 18-19. Although the court correctly barred the government from making that argument, it did not caution the jury against drawing the connection on its own. In failing to do so, the court may have committed error under Rules 801 and 802 by permitting the jury to use the testimony for its truth. See Fed. R. Evid. 801, 802.4 In any event, without a limiting instruction, the risk that Evans would be unfairly prejudiced by the jury's use of the testimony for its truth substantially outweighed the testimony's minimal value as background. See Webster, 649 F.2d at 351; United States v. Catanzaro, 407 F.2d 998, 1000-01 (3d Cir. 1969) (reversing conviction where jury may have used hearsay statement as evidence of defendant's predisposition).
The danger of unfair prejudice was further compounded by the instruction that was given to the jury. The entrapment instruction informed the jury that "willingness to commit the crimes may be shown in many ways, including by evidence of the defendant's prior similar conduct." 2/5/99 p.m. Tr. at 37.Since Agent Darnell's testimony that the FBI "had received ... information that Mr. Evans was involved" in prior drug trafficking was certainly "evidence of the defendant's prior similar conduct," the jury could reasonably have concluded that this was the evidence to which the judge was referring.5 Thus, the jury was effectively instructed that it could use the agent's testimony for its truth, in violation of Rules 801 and 802.6 This, of course, also greatly increased the risk that the jury would actually use the testimony for that impermissible purpose, further compounding the error committed under Rule 403.
In sum, we conclude that the admission of Special Agent Darnell's testimony was error under the Federal Rules of Evidence: under Rules 801 and 802 because the jury was effectively told that the testimony could be used for its truth, and under Rule 403 because the probative value of the only relevant nonhearsay purpose--general background--was substantially outweighed by the danger of unfair prejudice.
In addition to constituting error under the Federal Rules, the admission of Agent Darnell's testimony may have violated Evans' rights under the Confrontation Clause. See U.S. Const. amend. VI ("In all criminal prosecutions, the accused shall enjoy the right ... to be confronted with the witnesses against him...."). The purpose of that clause is to "ensure the reliability of the evidence against a criminal defendant by subjecting it to rigorous testing in the context of an adversary proceeding before the trier of fact." Lilly v. Virginia, 527 U.S. 116, 123-24 (1999) (internal quotation omitted). As we have already noted, such testing is not possible where, as here, the government presents the testimony of an out-ofcourt declarant through the mouth of another witness. See id. at 124 (citing California v. Green, 399 U.S. 149, 158 (1970)).
Nonetheless, not every use of hearsay violates the Confrontation Clause. " [W]here proffered hearsay has sufficient guarantees of reliability to come within a firmly rooted exception to the hearsay rule, the Confrontation Clause is satisfied." White v. Illinois, 502 U.S. 346, 356 (1992); see also Lilly, 527 U.S. at 124-25; Ohio v. Roberts, 448 U.S. 56, 66 (1980). In this case, the government has not suggested any hearsay exception that might apply to Darnell's testimony. Instead, it contends that Darnell's testimony was not hearsay at all because it was not offered to prove the truth of the matter asserted. If that contention were correct, there would be no violation of Evans' confrontation rights. See Tennessee v. Street, 471 U.S. 409, 414 (1985) (holding that the nonhearsay aspect of a confession, not offered to prove its truth, "raises no Confrontation Clause concerns"). As noted above, however, the jury was effectively told that it could use the evidence as proof of defendant's predisposition--i.e., for its truth. That erroneous instruction, coupled with the admission of Darnell's testimony, may well have deprived Evans of his right to confront his true accuser--Thomas Rose. See id. (noting that had jury been asked to infer that defendant's confession proved his participation in the crime, the evidence would have been hearsay and Confrontation Clause concerns would have been implicated); United States v. Jordan, 810 F.2d 262, 264 (D.C. Cir. 1987).
We need not resolve whether the error at issue in this case violated only the Rules of Evidence, or whether it also ran afoul of the Confrontation Clause. Because an error clearly occurred, the dispositive question is whether it was harmless.If it was, it cannot result in the reversal of Evans' convictions regardless of how we classify it. See Fed. R. Crim. P. 52;United States v. Olano, 507 U.S. 725, 731 (1993).
It is true that the distinction between constitutional and nonconstitutional error can be quite important, since the standards for testing whether such errors are harmless are different. See O'Neal v. McAninch, 513 U.S. 432, 438 (1995);Brecht v. Abrahamson, 507 U.S. 619, 622-23, 637-38 (1993).The standard for determining whether a constitutional error is harmless is whether it appears "beyond a reasonable doubt that the error complained of did not contribute to the verdict obtained." Chapman v. California, 386 U.S. 18, 24 (1967);see Neder v. United States, 119 S. Ct. 1827, 1837 (1999). For nonconstitutional errors, the standard is whether the error did not have "substantial and injurious effect or influence in determining the jury's verdict." Kotteakos v. United States, 328 U.S. 750, 776 (1946); see Brecht, 507 U.S. at 637.
In the instant case, however, the difference between the standards does not matter because the error was harmless under both. Although the jury could have used the hearsay testimony to conclude that defendant had a propensity to commit the charged drug offenses, Evans conceded that he committed those offenses, thereby removing the question of propensity from the case. Rather than contest that he sold drugs to George Rose, Evans claimed he was entrapped. The entrapment defense comprises two elements: "government inducement of the crime, and a lack of predisposition on the part of the defendant to engage in the criminal conduct."Mathews v. United States, 485 U.S. 58, 63 (1988); see Glover, 153 F.3d at 754. While the admission of Agent Darnell's testimony could have been prejudicial with respect to predisposition, the jury does not consider predisposition unless the defendant has first satisfied the burden of showing government inducement. See Glover, 153 F.3d at 754 (" [T]he defendant bears the initial burden of showing government inducement; if he is successful, the burden then shifts to the government to prove the defendant was predisposed to commit the crime."); United States v. Whoie, 925 F.2d 1481, 1485 (D.C. Cir. 1991). Evans' jury was instructed accordingly. See 2/5/99 p.m. Tr. at 37. Hence, the key question is whether the defendant presented sufficient evidence of inducement.
At oral argument, Evans' counsel conceded that the evidence of inducement was "slight." We see none at all."Even when a government agent repeatedly requests that the defendant engage in criminal conduct, inducement is not established unless the requests are coupled with persuasive overtures." United States v. McKinley, 70 F.3d 1307, 1312 D.C. Cir. 1995). The only "persuasive overture" proffered by defense counsel was Evans' claim that he provided the drugs because he and Thomas Rose "had a good friendship." Although we have in the past indicated that "pleas based on ... friendship" can satisfy the inducement prong of an entrapment defense, we have never found such a plea sufficiently strong to do so. United States v. Layeni, 90 F.3d 514, 517 (D.C. Cir. 1996); see, e.g., Glover, 153 F.3d at 755; McKinley, 70 F.3d at 1314.
But here there was no plea to friendship at all. According to Evans' own account, his friend, Thomas Rose, "never mentioned" drugs to him. 2/5/99 a.m. Tr. at 124. Rather, he "just asked me to look out for [his uncle], show him around the city." Id. at 123. Evans does not contend that this constituted an implied request to provide George Rose with drugs. To the contrary, defendant testified that he had not expected his friend's uncle to bring up the subject. See id. at 111. Hence, even accepting defendant's version of the facts, it establishes only that he independently decided to provide the drugs out of friendship for George Rose's nephew--not because of any plea from that nephew. This is insufficient to raise a jury question as to inducement, and because the jury was correctly instructed that inducement is a prerequisite for entrapment, defendant's entrapment defense necessarily failed for want of proof. See McKinley, 70 F.3d at 1309.Indeed, under these circumstances, defendant was not entitled to an entrapment instruction in the first place. See Glover, 153 F.3d at 755; McKinley, 70 F.3d at 1309. Because entrapment was Evans' only defense (given his concession to having participated in the charged drug transactions), we can say with certainty that the erroneous admission of Agent Darnell's testimony did not contribute to the result in this case.
The other issues raised on appeal require only brief discussion. In his opening brief, Evans' principal claim was that the trial judge committed reversible error by denying his request to strike a potential juror for cause. Evans ultimately used a peremptory challenge to strike the juror, who was not seated. After the opening brief was filed, the Supreme Court decided United States v. Martinez-Salazar, which held that a defendant cannot assert error after using a peremptory challenge to remove a juror who he alleges should have been excused for cause. See 120 S. Ct. 774, 782 (2000). Evans concedes that Martinez-Salazar resolves this claim.
Second, Evans contends that he should have received the benefit of the "safety valve" provisions of the federal sentencing guidelines, which would have allowed him to obtain a sentence below the statutory minimum of 120 months. See U.S.S.G. 5C1.2; see also 18 U.S.C. 3553(f); 21 U.S.C. 841(b). For a defendant to receive the benefit of the safety valve, the trial court must find, inter alia, that "the defendant has truthfully provided to the Government all information and evidence the defendant has concerning the offense or offenses that were part of the same course of conduct." U.S.S.G. 5C1.2(5). The court declined to make that finding, and there is more than sufficient evidence in the record to support the court's decision. Compare, e.g., 5/14/99 Tr. at 10 (defense's contention that Evans did not know the names of the two men who supplied the drugs for the charged transactions), with id. at 33 (court's conclusion that taped conversations showed Evans knew "fully what the nature and source of supply was ... and whom he has been dealing with and whom he has done other transactions with").
Finally, Evans argues that he should have received a downward departure from the applicable guideline range due to extraordinary family circumstances. Our review of a denial of a downward departure is limited. See In re Sealed Case, 199 F.3d 488, 490 (D.C. Cir. 1999); United States v. Leandre, 132 F.3d 796, 800 (D.C. Cir. 1998). Although Evans contends that the district court erroneously thought itself without authority to depart, the record reveals that the court knew it had the authority but that it concluded a departure was unwarranted after examining the relevant circuit precedents. See 5/14/99 Tr. at 33-34. We again concur with the district court and find no error in its decision. See Leandre, 132 F.3d 796; United States v. Dyce, 91 F.3d 1462 (D.C. Cir. 1996).
In closing, we take this opportunity to make a suggestion similar to one made by the Second Circuit in analogous circumstances. See United States v. Reyes, 18 F.3d 65, 72 (2d Cir. 1994). The analysis that has led us to conclude that the agent's testimony was improperly admitted is complicated, and we are well aware that trial courts do not have the opportunity we do to explore such intricacies at length. In this case, as in many, the issue arose without warning in the form of an objection to a question that the examiner had already posed. If the trial was not to be disrupted, the court had to resolve the issue on the spot without benefit of research. Yet, had the error not been harmless, its prejudicial impact would have required reversal of Evans' convictions.
When the government wishes to offer incriminating evidence of uncertain admissibility, these kinds of risks can be obviated through the submission of a motion in limine (written or oral) prior to the offer and before the jury is seated for the session at which the offer is to be made. In some situations, such advance notice is required by the Federal Rules. See Fed. R. Evid. 404(b).7 Even where it is not, this procedure would advance the government's dual interests in ensuring that defendants are accorded justice at trial, while protecting the integrity of verdicts on appeal.
In the case of Cornell Evans, although we find that error occurred, we also find that the error was harmless. Accordingly, defendant's convictions and sentence are affirmed.
See also United States v. Lovelace, 123 F.3d 650, 652-53 (7th Cir. 1997) (finding admission of informant's tip unnecessary to correct impression of racial bias because bias was not at issue in case); Forrester, 60 F.3d at 59-61 (reversing conviction where informant evidence was admitted to show officer's state of mind, which was not "relevant to the determination of any material fact"); United States v. Johnson, 439 F.2d 885, 888-89 (5th Cir. 1971) ("The desire of the government to show the jury why its agents were on the lookout for Johnson can in no way justify the use of prejudicial hearsay.").
Such consideration would be improper not only under Rules 801 and 802, but also under Rule 404(b). The latter states that " [e]vidence of other crimes ... is not admissible to prove the character of a person in order to show action in conformity therewith." Fed. R. Evid. 404(b); see Old Chief, 519 U.S. at 181-82.
See Lovelace, 123 F.3d at 653 (holding that admission of informant's tip that defendant would have drugs at specified location violated Rule 403, notwithstanding that it was offered to explain basis for police action); Reyes, 18 F.3d at 72 (reversing conviction where "resulting prejudice from the receipt of ... incriminating [out-of-court] declarations was considerable and far exceeded the minimal or non-existent probative value of the [declarations'] non-hearsay uses" as background evidence); United States v. Alonzo, 991 F.2d 1422, 1426-27 (8th Cir. 1993) (holding that if a statement "is both permissible background and highly prejudicial, otherwise inadmissible hearsay, fairness demands that the government find a way to get the background into evidence without the hearsay"); United States v. Mancillas, 580 F.2d 1301, 1310 (7th Cir. 1978) (holding that although giving "the jury a sense of the context of the activities to be described may provide some incidental benefit ... [,] any such value ordinarily is substantially outweighed by the danger of unfair prejudice"); 2 McCormick on Evidence 249 (5th ed. 1999) (" [Officers] should not ... be allowed to relate historical aspects of the case, such as ... reports of others containing inadmissible hearsay. Such statements are sometimes erroneously admitted under the argument that the officers are entitled to give the information upon which they acted. The need for this evidence is slight, and the likelihood of misuse great."); cf. Gatling, 96 F.3d at 1524 (upholding conviction where "any error that the court made" in admitting out-of-court statements for background purposes was harmlessly cumulative); Clarke, 24 F.3d at 267 (affirming where admission of police background testimony, although "questionable," was harmlessly cumulative); United States v. Freeman, 816 F.2d 558, 563-64 (10th Cir. 1987) (finding no error where admission of informant's statements for background purposes was nonprejudicial).
Cf. Reyes, 18 F.3d at 69 (holding that even where there have been limiting instructions, "when the likelihood is sufficiently high that the jury will not follow the limiting instructions, but will treat the evidence as proof of the truth of the declaration, the evidence is functionally indistinguishable from hearsay").
Darnell's testimony was not the evidence the court actually had in mind when giving the instruction. See 2/5/99 p.m. Tr. at 20 (advising counsel that instruction "pertains to the defendant's admission with respect to the exportation of drugs and not testimony from Agent Darnell"). The instruction, however, did not specify which prior conduct it encompassed.
Under Rule 404(b), evidence of prior crimes is admissible to prove the defendant's state of mind, and therefore his predisposition. See Fed. R. Evid. 404(b); United States v. Burkley, 591 F.2d 903, 921 (D.C. Cir. 1979). Like other facts, however, the prior crimes must themselves be proven through admissible (nonhearsay) evidence. See Webster, 649 F.2d at 349-50. As noted in the text, Agent Darnell's testimony could not have been used to prove that the prior crimes occurred (the truth of the matter asserted), and hence had no relevance to the question of defendant Evans' state of mind (predisposition). The most for which Darnell's testimony could have been used would have been to establish his state of mind--a fact not relevant to the state of mind of the defendant. See id.
Rule 404(b) provides that, with respect to evidence of "other crimes, wrongs, or acts,"
upon request by the accused, the prosecution in a criminal case shall provide reasonable notice in advance of trial, or during trial if the court excuses pretrial notice on good cause shown, of the general nature of any such evidence it intends to introduce at trial.
Fed. R. Evid. 404(b). Although there may have been a Rule 404(b) violation here, defendant has not alleged one.

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New Year’s Day. Welcome to 2019!
5 p.m., Diabetes Undone, first of eight consecutive weekly sessions, Sandy Seventh-day Adventist Church, 18575 S.E. Langensand Road, Sandy 97055. this program was developed by diabetes expert Dr. Wes Youngberg and is focused on improving health and eliminating dependence on medications. 503-698-2528 or 503-668-6144.
7 p.m., Information meeting about Heart Help: The Passenger Women’s Group, Healing Hope Adventist Church, 15150 N.E. Glisan St., Portland 97230. This 10-week group experience, which starts Jan. 16, focuses on each individual’s beginnings and how each person develops their unique attachment style. The class is 100 percent confidential and limited to eight women. Each session includes video with Drs. Ron and Nancy Rockey. Cost is $49 for a workbook 503-957-0809.
6 p.m., Vancouver Aglow monthly meeting, Shiloh Fellowship Church, 10709 S.E. 10th St., Vancouver, Wash. 98664. Fellowship and food during the first hour, followed by special speaker at 7. 360-694-6914.
Noon, George Fox University Legacy League luncheon, Canyon Commons Dining Hall on the university’s Newberg campus. Theatre professors Rhett Luedtke and Bryan Boad will discuss upcoming stage presentations. $10. RSVP to 503-538-7314 or 503-927-5011.
10:50 a.m., His Praise Men’s Chorus in concert during morning worship service, Riverside Seventh-day Adventist Church, 463 N. Shepherd Road, Washougal, Wash. 98671. The chorus of about 25 men is from the Portland-Vancouver area. 360-936-1401 or 360-953-1372.
Sanctity of Human Life Sunday. Some churches may have special observances.
1 p.m., Roe v. Wade Memorial March and Rally, starting at Josephine County Courthouse, 500 N.W. Sixth St., Grants Pass 97526, then marking to Riverside Park Pavilion, 304 E. Park St., for rally. 503-463-8563.
1:30 p.m., Roe vs. Wade Memorial Rally and March, starting at Brookings Church of the Nazarene, 1600 Chetco Ave., Brookings 97415. 541-412-9591.
2 p.m., Roe v. Wade Memorial Rally, meeting at Mercy Medical Center statue, 2700 N.W. Stewart Pkwy, Roseburg 97471, followed by baby shower at Roseburg Seventh-day Adventist Church, 1109 N.W. Garden Valley Blvd, Roseburg 97471. 541-673-4566.
Martin Luther King Jr. Day. A federal, state and local holiday marking the birthday of the famed civil rights leaders.
Morning, Roe v. Wade Memorial Pancake Breakfast, St. Mary’s Catholic Church, 800 S.E. Court Ave, Pendleton 97801. 541-276-1540.
Noon, Roe v. Wade Memorial Rally, Klamath County Government Center, 305 Main St,. Klamath Falls 97601. 503-463-8563.
6 p.m. Roe v. Wade Memorial Candlelight Vigil, outside Salem Planned Parenthood, 3825 Wolverine St. N.E., Salem 97305. 503-581-2229.
1 to 2 p.m., Roe V. Wade Memorial Rally, on front steps of Clark County Courthouse, 1200 Franklin St; Vancouver, Wash. 98660. 360-831-7542.
11 a.m. Roe v. Wade Memorial pro-life service, St. Francis of Assisi Catholic Church, 2450 N.E. 27th St., Bend 97701. 503-639-8235.
Roe vs. Wade Memorial Rally, Lane County location to be announced. 541-844-6484.

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Appeals from the Supreme Court of the State of New York. [303 U.S. 573, 575] Messrs. Harold L. Warner, of Brooklyn, N.Y., and Paul D. Miller and Henry R. Stern, both of New York City, for appellants.
Messrs. Paxton Blair, Oscar S. Cox, Davidson Sommers, Sol Charles Levine, and Paul Windels, all of New York City, for appellee.
'Utility' is defined, section 1(e), to include 'any person subject to the supervision of either division of the department of public service,' and every person, whether or not subject to such supervision, engaged 'in the business of furnishing or selling to other persons gas, electricity, steam, water, refrigeration, telephony and/or telegraphy' or service in these commodities. Each utility is required to pay a tax 'equal to three per centum of its gross income' (section 5) received during the effective period of the Local Laws, with a minor variation not here assailed for utilities not subject to the specified supervision. 1 The Local Laws specify that all revenues from the tax 'shall be deposited in a separate bank account or accounts, and shall be available and used solely and exclusively for the purpose of relieving the people of the city of New York from the hardships and suffering caused by unemployment'. Section 14. The Local Laws, admittedly passed under authority granted by the state Legislature,2 are assailed under the United States Constitution. For convenience we shall discuss the contentions of the New York Rapid Transit Corporation alone, as determination of the objections [303 U.S. 573, 577] raised by it is conclusive of those advanced by the Brooklyn and Queens Transit Corporation.
The New York Rapid Transit Corporation operates rapid transit railroads in the City of New York under a contract known as contract No. 4, dated March 19, 1913, made pursuant to the New York Rapid Transit Act Laws 1891, c. 4, as amended, between its predecessor (New York Municipal Railway Corporation) and the city. As a common carrier engaged in the operation of rapid transit railroads, the corporation is under the supervision of the transit commission, the head of the metropolitan division of the state department of public service. Accordingly, but under protest, it paid the taxes imposed by the Local Laws set out above, for the months January, 1935, to June, 1936, inclusive. It brought this action against the City of New York to recover the amounts paid, 1,408,697, with interest, on the ground that the Local Laws are unconstitutional. The case arises on the city's motion to dismiss the complaint.
The Supreme Court of New York, Special Term, denied the motion to dismiss the complaint and found that the Local Laws denied equal protection because of gross inequality of burden in comparison with other utilities. This order was affirmed by the Appellate Division of the Supreme Court, without opinion, on a 3-2 vote. Brooklyn & Queens Transit Corp. v. City of New York, 251 App.Div. 710, 296 N.Y.S. 1006. The Court of Appeals reversed (New York Rapid Transit Co. v. City of New York, 275 N.Y. 258, 9 N.E.2d 858), upheld the Local Laws against all attacks, and ruled that the complaint did not state a cause of action. Appeal was taken to this Court under section 237(a) of the Judicial Code, 28 U.S.C. 344(a), 28 U.S.C.A. 344.
The corporation challenges the Local Laws as violative of the equal protection and due process clauses of the Fourteenth Amendment and the contracts clause of article 1, 10, of the Constitution. [303 U.S. 573, 578] I. Classification. No question is or could be made by the corporation as to the right of a state, or a municipality with properly delegated powers, to enact laws or ordinances, based on reasonable classification of the objects of the legislation or of the persons whom it affects. 'Equal protection' does not prohibit this. Although the wide discretion as to classification retained by a Legislature often results in narrow distinctions, these distinctions, if reasonably related to the object of the legislation, are sufficient to justify the classification. German Alliance Ins. Co. v. Lewis, 233 U.S. 389, 418 , 34 S.Ct. 612, L.R.A. 1915C, 1189; Atchison, Topeka & S.F.R.R. v. Matthews, 174 U.S. 96, 105 , 19 S.Ct. 609; Giozza v. Tiernan, 148 U.S. 657 , 13 S.Ct. 721. Indeed, it has long been the law under the Fourteenth Amendment that 'a distinction in legislation is not arbitrary, if any state of facts reasonably can be conceived that would sustain it.' Rast v. Van Deman & Lewis Co., 240 U.S. 342, 357 , 36 S.Ct. 370, 374, L.R.A.1917A, 421, Ann.Cas.1917B, 455; Borden's Company v. Baldwin, 293 U.S. 194, 209 , 55 S.Ct. 187, 191; Metropolitan Casualty Co. v. Brownell, 294 U.S. 580, 584 , 55 S.Ct. 538, 540. 'The rule of equality permits many practical inequalities.' Magoun v. Illinois Trust & Savings Bank, 170 U.S. 283, 296 , 18 S.Ct. 594, 599; Breedlove v. Suttles, 302 U.S. 277, 281 , 58 S.Ct. 205; Carmichael v. Southern Coal & Coke Co., 301 U.S. 495, 509 , 57 S.Ct. 868, 872, 109 A.L.R. 1327. 'What satisfies this equality has not been, and probably never can be, precisely defined.' Magoun v. Illinois Trust & Savings Bank, supra, 170 U.S. 283, 293 , 18 S.Ct. 594, 598.
The power to make distinctions exists with full vigor in the field of taxation, where no 'iron rule' of equality has ever been enforced upon the states. Bell's Gap R. Co. v. Pennsylvania, 134 U.S. 232, 237 , 10 S.Ct. 533; Giozza v. Tiernan, 148 U.S. 657, 662 , 13 S.Ct. 721. A state may exercise a wide discretion in selecting the subjects of taxation (Magoun v. Illinois Trust & Savings Bank, 170 U.S. 283, 294 , 18 S. Ct. 594; Quong Wing v. Kirkendall, 223 U.S. 59, 62 , 32 S.Ct. 192; Heisler v. Thomas Colliery Co., 260 U.S. 245, 255 , 43 S. Ct. 83, 84) 'particularly [303 U.S. 573, 579] as respects occupation taxes.' Oliver Iron Mining Co. v. Lord, 262 U.S. 172, 179 , 43 S.Ct. 526, 529; Brown-Forman Co. v. Kentucky, 217 U.S. 563, 573 , 30 S.Ct. 578; Southwestern Oil Co. v. Texas, 217 U.S. 114, 121 , 126 S., 30 S.Ct. 496; see Ohio Oil Co. v. Conway, 281 U.S. 146, 159 , 50 S.Ct. 310, 313.
Since carriers or other utilities with the right of eminent domain, the use of public property, special franchises or public contracts, have many points of distinction from other business, including relative freedom from competition, especially significant with increasing density of population and municipal expansion, these public service organizations have no valid ground by virtue of the equal protection clause to object to separate treatment related to such distinctions. Carriers may be treated as a separate class (compare Seaboard Air Line v. Seegers, 207 U.S. 73 , 28 S.Ct. 28) and, as such, taxed differently or additionally. Southern R. Co. v. Watts, 260 U.S. 519, 530 , 43 S.Ct. 192, 197. This Court has approved the adoption of modes and methods of assessment and administration peculiar to railroads (Kentucky Railroad Tax Cases, Cincinnati, N.O. & T.P.R. Co. v. Kentucky, 115 U.S. 321, 337 , 6 S. Ct. 57), and upheld tax rates for railroads differing from those on other property, and as between railroad taxpayers, Michigan Central R. Co. v. Powers, 201 U.S. 245, 300 , 26 S.Ct. 459; Ohio Tax Cases, 232 U.S. 576, 590 , 34 S.Ct. 372; Columbus & G. Ry. Co. v. Miller, 283 U.S. 96 , 51 S.Ct. 392. Similarly, we have explicitly recognized that a state may subject public service corporations to a special or higher income tax than individuals or other corporations. Atlantic Coast Line R. Co. v. Daughton, 262 U.S. 413, 424 , 43 S.Ct. 620, 624. The corporation concedes this general right to set apart the utilities in New York for taxation.
The corporation is brought within the purview of the Local Laws because 'utility' is defined to include those 'subject to the supervision ... of the department of public service.' Section 1(e). It contends that classification in an [303 U.S. 573, 580] excise tax, however, should be made by specific reference to the character of the business to be taxed, and that it is arbitrary to make taxability depend on whether a person is subject to the supervision of a commission. Valid reason for the definition utilized appears from the fact that the Local Laws merely adopted the classification previously established in the New York Public Service Law, N.Y.Laws 1910, c. 480, as amended, Consol. Laws, c. 48, which had selected those offering several kinds of public services, including the transportation of persons and property, section 25, 3 and made them subject to the supervision of the department of public service.
Several reasons may be suggested for the selection for special tax burdens of the utilities embraced by the Local Laws under discussion. We mention a few. Those subject to the supervision of the department of public service are assured by statute that new private enterprises may not enter into direct competition without a showing of convenience and necessity for the public service. 4 See New York Steam Corp. v. City of New York, 268 N.Y. 137, 147, 197 N.E. 172, 99 A.L.R. 1157. The corporation suggests that the statute does not curb competition from the city's own rapid transit lines and from taxicabs. Freedom from unlimited, direct, private competition is of itself a sufficient advantage over ordinary businesses to warrant the imposition of a heavier tax burden. Reports which must be filed with the department of public service on the basis of approved systems of accounting suggest an administrative convenience in the collection and verification of the [303 U.S. 573, 581] tax5 which might properly have been taken into account by the city's Legislature. See Carmichael v. Southern Coal & Coke Co., 301 U.S. 495, 511 , 57 S.Ct. 868, 873, 109 A.L.R. 1327, and cases cited. The Legislature may reasonably have conceived that the revenues of utilities furnishing indispensable services are subject to relatively little fluctuation, even in depression times, and reasonably have shaped its tax system accordingly.
II. Discrimination. The corporation urges here, as the lower state courts held, that these general principles of classification are not effective to validate legislation where, as in these Local Laws, arbitrary, unreasonable and hostile discrimination against certain railroad companies is shown. This unlawful discrimination appears, because 'they are,' as the corporation sees it, 'in a far poorer position to bear the burden of unemployment relief than is business in general.' Business may pass on taxes. Other utilities may apply to the commission and perhaps to the courts for an adequate rate increase. This corporation cannot do so as by contract No. 4 with the city it is bound to furnish transportation for a five-cent fare, which by city charter provision cannot be changed without the approval of the proposal by a majority of the qualified voters, on referendum. 6 It is alleged in the complaint that rapid transit corporations are less able to pay a gross receipts tax than other utilities, whose [303 U.S. 573, 582] gross income yields a higher percentage of profit, that the operation and maintenance expenses of these corporations are higher in relation to gross receipts than those of other utilities, the ratio of net income to gross receipts, lower. It is said to be highly discriminatory to classify these railroads apart from other businesses, or in the same group as other utilities. The differences from business are not enough and from other utilities too great to justify this attempted classification, which sets them apart from business as a whole, and yokes them with other utilities.
The disadvantages complained of, as to fare limitations, are applicable only to the corporation, a single member of a class of utilities. It is quite fortuitous that this particular corporation must seek adjustments in fare in a peculiar way. 'The legislature is not required to make meticulous adjustments in an effort to avoid incidental hardships.' See Great Atlantic & Pac. Tea Co. v. Grosjean, 301 U.S. 412, 424 , 57 S.Ct. 772, 776, 112 A.L.R. 293. 'If the accidents of trade lead to inequality or hardship, the consequences must be accepted as inherent in government by law instead of government by edict.' Fox v. Standard Oil Co., 294 U.S. 87, 102 , 55 S.Ct. 333, 339.
In comparing its burdens with those of other utilities, the corporation, by its argument, suggests that a gross receipts tax is invalid while a net income tax is valid. In taxing utilities as a class the Legislature is not required to make 'meticulous adjustments' for a particular sub-class of utility. See Great Atlantic & Pac. Tea Co. v. Grosjean, 301 U.S. 412 , at page 424, 57 S.Ct. 772, 776, 112 A.L.R. 293, supra. Moreover, while taxation of net income is apportioned to ability to pay, and is therefore 'an equitable method of distributing the burdens of government,' see New York ex rel. Cohn v. Graves, 300 U.S. 308, 313 , 57 S.Ct. 466, 467, 108 A.L.R. 721, it is not a compulsory method. There are other justifications for the gross receipts tax. Unconcerned [303 U.S. 573, 583] with disputes about permissible deductions, it has greater certitude and facility of administration than the net income tax, an important consideration to taxpayer and tax gatherer alike. And the volume of transactions indicated on the taxpayer's books may bear a closer relation to the cost of governmental supervision and protection than the annual profit and loss statement. In Clark v. Titusville, 184 U.S. 329 , at page 334, 22 S.Ct. 382, 384 we rejected an equal protection objection to a license tax on merchants, which we said was 'a tax on the privilege of doing business, regulated by the amount of sales, and ... not repugnant to the Constitution of the United States.' And we have heretofore had occasion to remark that gross receipts from an occupation constitutes an 'appropriate measure of the value of the privilege' of engaging in that occupation. Western Live Stock v. Bingaman, 303 U.S. 250 , 58 S.Ct. 546, 549, decided February 28, 1938; American Manufacturing Co. v. St. Louis, 250 U.S. 459, 463 , 39 S.Ct. 522; State of Maine v. Grand Trunk Ry. Co., 142 U.S. 217, 228 , 12 S.Ct. 121, 163.
Reliance is placed upon certain language of the opinion in Stewart Dry Goods Co. v. Lewis, 294 U.S. 550 , 55 S.Ct. 525. But the tax on retailers held invalid in that case increased in rate with increasing volume. The Court said that the excise was laid upon the making of a sale, and that the statute 'exacts from two persons different amounts for the privilege of doing exactly similar acts because the one has performed the act oftener than the other.' 294 U.S. 550 , at page 566, 55 S. Ct. 525, 532. For that reason it was thought necessary to inquire whether the tax could be justified as related to ability to pay, an inquiry we need not here pursue. The Court did not condemn a fixed-rate gross receipts tax, such as is involved in the present case. Indeed it suggested that the 'desired end' might have been secured by the widely adopted 'flat tax on sales' (at page 563 of 294 U.S., 55 S.Ct. 525, 531), and indicated by way of contrast that though such a tax 'would impose a heavier burden on the taxpayer having the greater volume [303 U.S. 573, 584] of sales' the graduated tax under consideration exacted not only a larger gross amount but one 'larger in proportion to sales' (at page 564 of 294 U. S., 55 S.Ct. 525, 531).
III. Relation to Object of Legislation. As a further ground for the invalidity of the Local Laws the corporation urges that 'the classification must rest upon some ground of difference, having a fair and substantial relation to the object of the legislation.' It is asserted and correctly so, that the Local Laws in question, as well as the state enabling statutes, show by their titles and content that the proceeds of the challenged taxes were for the relief of unemployment. 7 Violation of the rule invoked, it is asserted, occurs from the discrimination shown by the legislation in raising 'a special fund for the particular purpose' from taxpayers no more responsible than others for the conditions. The corporation seems to be of the opinion that no 'state or city can, without conflict with the Constitution, adopt a tax statute, which states a specific object sought to be accomplished thereby and which at the same time puts the entire burden of the tax [303 U.S. 573, 585] upon one particular class of business, even though that class is in no different position in relation to the object sought to be accomplished than business in general.' The brief states the point to be 'that there is a distinction between the ordinary excise tax with no specific purpose attached thereto, and a tax which is a part of a plan for the accomplishment of a specified object.' The 'object of the legislation,' to the taxpayer, is apparently the relief of unemployment.
While, of course, the object of this legislation is in a sense to relieve unemployment, this is the object of the appropriation of the proceeds of the tax. The 'object,' as used in the rule and cases referred to by the corporation, is the object of the taxing provisions, i.e., the raising of the money. If the designation of utilities as the only taxpayers under the legislation in question does not deny to them the equal protection of the laws, the fact that an appropriation of the funds, for relief is a part of the legislation is not significant. 'A tax is not an assessment of benefits.' Carmichael v. Southern Coal & Coke [303 U.S. 573, 586] Co., 301 U.S. 495, 522 , 57 S.Ct. 868, 878, 109 A.L.R. 1327. Taxes are repeatedly imposed on a group or class without regard to responsibility for the creation or relief of the conditions to be remedied. Idem, note 14, at page 522 of 301 U.S., 57 S.Ct. 868, 878, 109 A.L.R. 1327. The Carmichael Case involved a state act which levied a tax on employers of eight or more to provide unemployment benefits for workers employed by this class of employers. It was urged that the classification should have been based on the unemployment record of the employer i.e., should have borne a relation to the object of unemployment relief. Against this contention, that there was no relation between the class of taxpayers and the purpose for which the fund was raised, this Court held that it is not necessary that there be 'such a relationship between the subject of the tax (the exercise of the right to employ) and the evil to be met by the appropriation of the proceeds (unemployment).' At page 522 of 301 U.S., 57 S.Ct. 868, 878, 109 A.L.R. 1327. See, also, Cincinnati Soap Co. v. United States, 301 U.S. 308, 313 , 57 S. Ct. 764, 766. The corporation suggests that in the Carmichael Case there was a special relationship between the class taxed and the purpose for which the proceeds were spent, but the Court expressly said that this was something 'the Constitution does not require.' At page 523, of 301 U.S., 57 S.Ct. 868, 879, 109 A.L.R. 1327. There need be no relation between the class of taxpayers and the purpose of the appropriation.
The cases cited by the corporation, to sustain its contention that classification must rest upon some ground of difference having a fair and substantial relation to the object of the legislation, do not support the conclusion that the 'object' referred to is the purpose for which the proceeds are to be spent. These authorities rather support the view that the 'object' is the revenue to be raised by the acts. In Colgate v. Harvey, 296 U.S. 404 at pages 423, 424, 56 S.Ct. 252, 256, 102 A.L.R. 54, it was recognized that the classification 'must rest upon some ground of difference having a fair and substantial relation to the object of the legislation' but it [303 U.S. 573, 587] was said that 'the object of the act ... simply is to secure revenue.' In Stebbins v. Riley, 268 U.S. 137 , 45 S.Ct. 424, 44 A.L.R. 1454, Royster Guano Co. v. Virginia, 253 U.S. 412 , 40 S.Ct. 560, and Air Way Electric Appliance Corporation v. Day, 266 U.S. 71 , 45 S. Ct. 12, the rule contended for by the corporation was recognized but with no intimation that the 'object' was considered to be the purpose for which the proceeds of the tax were spent. The 'object' of the Local Laws under consideration, as in the case with most tax statutes, was obviously to secure revenue. In some cases a classification of taxpayers may be upheld as having a fair and substantial relation to a constitutional nonfiscal object (Alaska Fish Salting & By-Products Co. v. Smith, 255 U.S. 44, 48 , 41 S.Ct. 219, 220; Quong Wing v. Kirkendall, 223 U.S. 59, 62 , 63 S., 32 S.Ct. 192; Aero Mayflower Transit Co. v. Georgia Public Service Commission, 295 U.S. 285, 291 , 55 S.Ct. 709, 711), but it is not constitutionally necessary that the classification be related to the appropriation. In United States v. Butler, 297 U.S. 1 , 56 S.Ct. 312, 102 A.L.R. 914, also relied upon by the corporation, the attack on the federal statute was successful because the tax was said to be a part of an unconstitutional scheme to regulate production through expenditures. It was not held invalid because there was no relation between the taxpayer and the appropriation. See Cincinnati Soap Co. v. United States, supra. We conclude, therefore, that the provisions of the legislation earmarking the funds collected are not of importance in determining whether or not the classification of the challenged acts is discriminatory.
What we have said in showing that the Local Laws do not deny the equal protection of the laws also disposes of the corporation's contention that the Local Laws constitute a deprivation of due process, as being measured without regard to the net income of or ruinous effect on the taxpayers, and as laying on a particular class a burden which should be borne by all. [303 U.S. 573, 588] IV. Contracts Clause. 8 The corporation contends that, in contravention of the Constitution, article 1, 10, the Local Laws impair the obligation of the contract known as contract No. 4, entered into March 19, 1913, between its predecessor and the city, under which it operates its owned and leased properties in New York.
By the terms of the contract, as summarized in the corporation's complaint, the city agreed to construct certain rapid transit railroads, and the New York Municipal Railway Corporation, appellant's predecessor, agreed to contribute a portion of the cost of construction and to equip the railroads for operation. The latter further agreed to reconstruct and build additions to certain existing railroads, which it then had the right and duty to operate, so as to adapt them for operation in conjunction with the railroads to be constructed by the city. Under the terms of contract No. 4, the city leased the railroads which it agreed to construct, and their equipment, which was to be furnished by the lessee, to the New York Municipal Railway Corporation, its successors and assigns, for a term of 49 years commencing on or about the first day of January, 1917, and the lessee agreed to operate said railroads to be constructed by the city in conjunction with the existing railroads as one system, and for a single fare not exceeding five cents.
The corporation further complains that the tax payments deprive it of 'a substantial part of the interest and sinking fund allowance to which it was entitled' under deductions Nos. 7 and 8 set out above. The loss thus suffered was alleged to total more than $600,000.
We search in vain for any provision in the contract which expressly exempts the corporation from payment of this tax, or indeed of any tax. Yet this is what is required before support can be obtained from the contracts clause. More than 100 years ago it was stated by Chief Justice Marshall, in Providence Bank v. Billings, 4 Pet. 514, 562, 563, that the taxing power is of such 'vital importance' that 'We must look for the exemption in the language of the instrument; and if we do not find it there, it would be going very far, to insert it by construction.' In Erie Ry. Co. v. Pennsylvania, 21 Wall. 492, 499, this Court said that 'the language in which the sur- [303 U.S. 573, 591] render is made must be clear and unmistakable.' At the present term, the Court has reiterated that contracts of tax exemption are 'to be read narrowly and strictly.' Hale v. State Board, 302 U.S. 95, 109 , 58 S.Ct. 102, 107. See, also, Pacific Co. v. Johnson, 285 U.S. 480, 491 , 52 S.Ct. 424, 426; Puget Sound Power & Light Co. v. Seattle, 291 U.S. 619, 627 , 54 S.Ct. 542, 546.
Not only is the corporation unable to point to an unmistakable exemption, but the contract itself contains an express provision permitting the deduction of taxes from the gross receipts. 9 Its language is broad. It refers to 'all taxes ... of every description (whether on physical property, stock or securities, corporate or other franchises, or otherwise) assessed or which may hereafter be assessed against the Lessee in connection with ... the operation of the ... Railroads.' The taxes under discussion clearly come within its terms.
It is alleged that, at the time of the execution of the contracts, and prior to the passage of the state enabling acts,10 the tax power of the city was confined to special assessments for public improvements, and ad valorem taxes on real estate and special franchises issued by the city. The corporation insists that it was contemplated that no other type of tax would be assessed, and that it was not necessary to make provision for exemption since the corporation was merely accepting the tax burden common to all owners of property. It is urged that the contract be interpreted from this point of view, and the [303 U.S. 573, 592] provision limited to taxes of the type which the city could have imposed in 1913.
There is no reason to limit the ordinary meaning of words used in a contract by men prepared to invest under its terms. 'A business proposition involving the outlay of very large sums cannot be and is not taken by the parties concerned according to offhand impressions; it is scrutinized phrase by phrase and word by word.' People of State of New York ex rel. Interborough Rapid Transit Co. v. Sohmer, 237 U.S. 276, 284 , 35 S.Ct. 549, 551; cf. Ohio Life Ins. & T. Co. v. Debolt, 16 How. 416, 435.
Admitting that with respect to a franchise contract silent as to taxes the city may validly impose a license tax on the privilege of doing business, since 'surrender of the state's power to tax the privilege is not to be implied from the grant of it,' Puget Sound Power & Light Co. v. Seattle, 291 U.S. 619, 627 , 54 S.Ct. 542, 546, it is urged by the corporation that here the city is violating the affirmative covenants of a contract, namely, the provisions for allocation of revenue. The contention is made that these provisions preclude an 'alteration' by virtue of a gross receipts tax.
This Court, in construing a contract to determine whether or not legislation is violative of its provisions within the meaning of the contract clause of the Constitution will examine for itself the existence and meaning of the contract as well as the relation of the parties and the circumstances of its execution. Appleby v. City of New York, 271 U.S. 364, 379 , 380 S., 46 S.Ct. 569, 573; Funkhouser v. J. B. Preston Co., 290 U.S. 163, 167 , 54 S.Ct. 134, 135; Violet Trapping Co. v. Grace, 297 U.S. 119, 120 , 56 S.Ct. 386. But of course in so doing we 'lean toward agreement with the courts of the state, and accept their judgment as to such matters unless manifestly wrong.' Hale v. State Board, 302 U.S. 95, 101 , 58 S.Ct. 102, 103; Tampa Waterworks v. Tampa, 199 U.S. 241, 243 , 244 S., 26 S.Ct. 23; Southern Wisconsin Ry. Co. v. Madison, 240 U.S. 457, 461 , 36 S.Ct. 400. In this case the Court of Appeals of New York, 275 N.Y. 258, 268, 9 N. E.2d 858, 861, has determined that 'the right to tax cannot be lost by such tenuous implication,' i.e., on the theory that the tax enables the city to secure a portion of the gross income in contravention of the con- [303 U.S. 573, 594] tract. We see no reason for disagreeing with the conclusion of the Court of Appeals of New York upon this point.
In effect the corporation is urging that a constructive condition restricting the city's power of taxation should be incorporated in the contract, by speculation as to what the parties must necessarily have intended, despite the long-standing rule that exemptions must be 'clear and unmistakable.' Erie R. Co. v. Pennsylvania, 21 Wall, 492, and other cases, all cited supra.
The corporation professes to dread an interpretation of the contract and the legislation, which will put it 'wholly at the mercy' of the city; under which the corporation's 'gross receipts would be disposed of, not as Contract No. 4 provides, but as the City may from time to time in its wisdom determine.' The corporation is not deprived of its right to resist on constitutional or legal grounds whatever tax or assessment may be imposed upon it or its property. The city cannot lay a gross receipts tax on the corporation unless it selects a class of taxpayers which meets the requirement of the equal protection to the laws. The provisions of the contract as to taxes are certainly not sufficiently explicit to justify us in denying to the city the right to collect such taxes as those involved in this litigation. The danger which the corporation sees from what it considers to be a violation by legislation of its contract rights is a danger which every utility, with a franchise which does not protect its property from additional taxation, must endure.
Convincing precedent for the contention of the city is found in North Missouri R. Co. v. Maguire, 20 Wall. 46, 63, where this court considered a statute of Missouri which provided that the railroad could issue bonds having priority over the state's mortgage. The act made specific provision for the allocation of the earnings of the railroad company in much the same manner as contract No. 4 [303 U.S. 573, 595] does in the present case. The act established a 'fund commissioner' and provided that the railroad company should pay over to this commissioner 'all the gross earnings and daily receipts.' It was provided that the commissioner should first pay amounts required for 'actual current expenditures'; should then make other specified deductions, and lastly, should apply any excess to certain first mortgage bonds and then against the railroad's debt to the state.
Subsequently the State Constitution was amended to provide that an annual tax of 10 per cent. of the gross receipts should be levied on the North Missouri Railroad Company and two other named corporations. The state court held that the earlier statute constituted a contract but considered the payment of taxes to fall within 'current expenditures in carrying on the ordinary business.' In this Court, the company argued that the tax constituted a violation of this contract, since it overturned the allocation of receipts and had the effect of converting the state from a junior creditor to a first mortgagee.
In our opinion, as the contract does not prohibit this tax, the legislation does not violate the contracts clause.
[ Footnote 1 ] Utilities subject to the supervision of the department of public service pay 3 per cent. of their 'gross income,' as defined by section 1(c ); the other utilities pay 3 per cent. of their 'gross operating income,' as defined by section 1(d).
[ Footnote 2 ] N.Y.Laws 1934, Ex.Sess., c. 873, authorized any city of a million inhabitants to impose for purposes of unemployment relief any tax within the powers of the state Legislature, including a tax on gross income or gross receipts of those doing business in the city. The act specifically provided, section 2, that the revenues shall be deposited in a separate bank account and used solely for the relief purposes. The authority granted by this statute expired December 31, 1935, but was extended, with certain restrictions not material here, until July 1, 1936, by N.Y. Laws 1935, c. 601.
[ Footnote 3 ] Others are the production and/or furnishing of gas, electricity, steam, and water, communication by telegraph or telephone, omnibus transportation. New York Public Service Law, 64, 78, 89-a, 90, 60.
[ Footnote 4 ] New York Public Service Law, Laws 1910, c. 480, as amended, Consol. Laws, c. 48: section 53 (railroad; street railroad); section 63-d (omnibus ); section 68 (gas; electricity); section 81 (steam); section 89-e (water); section 99(1) (telephone and telegraph).
[ Footnote 5 ] Operating revenues are reported by railroads. See, e.g., Transit Commission, Summary of Reports of Rapid Transit, Street Surface Railway and Bus Companies operating in the City of New York for the Quarter April- June, 1935, and for the Fiscal Year Ended June 30, 1935; Id., Quarter, April-June, 1936, and for the Fiscal Year Ended June 30, 1936.
[ Footnote 6 ] City of New York, Local Law No. 16, p. 106, of 1925, adding 242-d to Greater New York Charter.
The argument is applicable in No. 436. There the limitation on fare exists in a franchise, alleged in the complaint to be beyond the regulatory power of the transit commission.
[ Footnote 10 ] See supra note 2.

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text:
Doe v. Ft. Lauderdale Medical Center Management, Inc.
FT. LAUDERDALE MEDICAL CENTER MANAGEMENT, INC., Appellee.
Rehearing Denied April 12, 1988.
Job applicant brought suit against medical center, for damages suffered when employee committed sexual battery on her during job interview. The Circuit Court, Broward County, Harry G. Hinckley, Jr., J., granted center summary judgment. On appeal, the District Court of Appeal, Sharp, W., Associate Judge, held that: (1) medical center was not liable on theory that interviewer was managing agent of hospital, and (2) genuine issue of material fact precluded summary judgment on other theories of liability.
Medical center was not liable for alleged sexual battery performed upon job applicant by nondoctor interviewer during his physical examination of her breasts and thighs, ostensibly for insurance purposes, on theory that interviewer was managing agent of medical center, even though interviewer claimed to be doctor and part owner of center.
Genuine issue of material fact, as to whether medical center employer was liable for job interviewer's examination of applicant's breasts and thighs during interview, upon his claim he was a doctor and performing examination for purposes of insurance, on theories of respondeat superior, negligent supervision or retention, and breach of implied contract, precluded summary judgment in favor of medical center, particularly where center was aware that interviewer had impersonated doctors before.
*81 Dan Cytryn of Law Offices of Cytryn and Santana, P.A., Lauderhill, for appellants.
Shelley H. Leinicke of Wicker, Smith, Blomqvist, Tutan, O'Hara, McCoy, Graham & Lane, Fort Lauderdale, for appellee.
John and Jane Doe appeal from a summary judgment which denied them any relief in their suit for damages against the Ft. Lauderdale Medical Center Management, Inc. Jane sought to prove that Bieber, the Center's manager, committed a sexual battery on her when she interviewed at the Center for a job. We reverse.
Read in a light most favorable to the Does, [See Delaney v. Breeding's Homestead Drug Co., 93 So.2d 116 (Fla.1957); Elmore v. Vatrano, 485 So.2d 888 (Fla. 1st DCA Fla.1986)], the record in this case established that Jane Doe went to the Center in response to a newspaper ad to apply for the position of a medical assistant. After filling out an application, Jane was then escorted by Bieber into a medical examination room where she was interviewed.
During the interview, Bieber told her he was a part owner of the medical center and he was one of the doctors on the staff. After concluding the job interview, Bieber told Jane it was necessary for medical insurance purposes for her to have a physical examination. He advised her to get the physical done immediately so that if the Board of Directors approved, she could start work the following Monday.
Bieber said the medical insurance company was particularly concerned with cancer, and that he would have to check her for lumps. He then proceeded to probe Jane's neck, arms, and breasts. After she said she had had a recent urinary tract infection, he also felt her abdomen and upper inner thighs.
The record also established that Bieber had in the past represented himself as being a medical doctor. He sometimes introduced himself to patients and others as "Dr. Bieber." He sometimes wore a white jacket, typically worn by doctors. The Center's employees knew of these incidents. He was once reprimanded by his supervisor for referring to himself as a medical doctor.
The Center clearly authorized Bieber to interview job applicants for the staff and allowed him access to a medical examination room for such purposes. Jane was just one of three job applicants Bieber told he was a medical doctor and from whom Bieber requested permission to do a physical examination. A physical examination as a prerequisite to employment is not an unusual requirement for a prospective employee in a health or medical facility.
 The Does pled four theories of liability against the Center: (1) the acts of Bieber were the same as the acts of the Center because he was a managing agent; (2) respondeat superior, based on apparent authority; (3) negligent supervision or retention of Bieber as an employee; and (4) breach of an implied contract to safeguard Jane's welfare while she was at the Center. We agree summary judgment was proper regarding the first theory. However, we think there were material issues of fact raised by this record regarding the second, third, and fourth theories of recovery. City of Miami v. Simpson, 172 So.2d 435 (Fla.1965); Singer v. Star, 510 So.2d 637 (Fla. 4th DCA 1987); McArthur Jersey Farm Dairy, Inc. v. Burke, 240 So.2d 198 (Fla. 4th DCA 1970).
The fourth theory, breach of implied contract, has not yet been relied upon by a case decided in Florida, although it has *82 been noted. See Stone v. William M. Eisen Co., 219 N.Y. 205, 114 N.E. 44 (N.Y.1916); Martin v. United Security Services, Inc., 373 So.2d 720 (Fla. 1st DCA 1979) (Erwin, J., concurring specially); Nazareth v. Herndon Ambulance Service, Inc., 467 So.2d 1076, 1079 (Fla. 5th DCA), rev. denied, 478 So.2d 53 (Fla.1985). We do not think this theory should be ruled out at this stage of the case.
Accordingly, we reverse the summary judgment and remand for further proceedings consistent with this opinion.
DOWNEY and WALDEN, JJ., concur.

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Mark Schiltz and Lisa Erlandson, in their individual capacities, and Houston County, Defendants.
This matter is before the Court on Defendant's Motion for Summary Judgment. For the following reasons, the Motion is granted.
On October 17, 2013, a Minnesota State Trooper arrested Plaintiff Ryan Pik after a traffic stop near La Crescent, Minnesota. Because Pik had an outstanding warrant for his arrest in Wisconsin, the trooper transported Pik to the Houston County Law Enforcement Center. Pik remained in jail until October 30, when he was transported to Wisconsin.
Pik instituted this lawsuit in state court, and Defendants removed it to federal court in early September. Pik's Complaint raises three counts: a § 1983 claim for deliberate indifference as to Schiltz and Erlandson, a failure-to-train claim against the County, and a Monell claim against the County. In his memorandum in opposition to Defendants' Motion, Pik concedes that Defendants are entitled to summary judgment on his claims against the County and his claim regarding failure to receive mental health care or medication. (Pl.'s Opp'n Mem. (Docket No. 29) at 2.) Thus, the only claim remaining is his claim for deliberate indifference to serious medical needs as to Schiltz and Erlandson.
To establish a claim of deliberate indifference to serious medical needs under 42 U.S.C. § 1983, Pik must show both “an objectively serious medical need” and “that the defendant actually knew of, but deliberately disregarded, such need.” Vaughn v. Gray, 557 F.3d 904, 908 (8th Cir. 2009). In addition, because the jail officials here are state actors, Pik must overcome their qualified immunity defense. To do this, he must show that “the facts, viewed in the light most favorable to [him], demonstrate the deprivation of a constitutional or statutory right” and that “the right was clearly established at the time of the deprivation.” Howard v. Kansas City Police Dep't, 570 F.3d 984, 988 (8th Cir. 2009). Pik asserts a claim for deliberate indifference for failing to allow him to see a physician and for intentional delay in treatment.
An objectively serious medical need is one that is either supported by a physician's diagnosis or is “so obvious that even a layperson would easily recognize the necessity for a doctor's attention.” Bailey v. Feltmann, 810 F.3d 589, 594 (8th Cir. 2016). “Establishing the subjective component of a deliberate indifference claim requires showing ‘a mental state akin to criminal recklessness' and neither negligence nor gross negligence are sufficient.” Ryan v. Armstrong, 850 F.3d 419, 425 (8th Cir. 2017) (quoting Thompson v. King, 730 F.3d 742, 746-47 (8th Cir. 2013)).
Pik contends that, because the nurse admitted that swelling could be a sign of a fracture and also admitted that a fracture of the fifth metacarpal would require a physician's attention, he has adequately established a genuine issue of fact as to whether injury was “so obvious that even a layperson would easily recognize the necessity for a doctor's attention.” Bailey, 810 F.3d at 594. But Pik misses a necessary step: merely because swelling can be a symptom of a fracture does not mean that every detainee with a swollen hand must be transported to the doctor. Rather, the question here is whether Pik's injury was so objectively serious that Schiltz and Erlandson knew or should have known that he needed to see a physician. The only evidence is that both Schiltz and Erlandson examined Pik and did not believe that his injury was serious. Pik's self-serving testimony regarding his requests to see a physician notwithstanding, he cannot establish any genuine issue of material fact as to whether his medical need was so serious or obvious that it was criminally reckless for Defendants to fail to transport him to a doctor.


The United States of America and defendant Richard E. Nobles entered into a plea agreement whereby defendant agreed to enter a plea of guilty to Count 4 of the Indictment, which charges him with money laundering in violation of 18 U.S.C. § 1957. On January 23, 2014, defendant, accompanied by his counsel, appeared for a change of plea proceeding. Defendant consented, pursuant to 28 U.S.C. §636(b)(3), to enter a guilty plea before a Magistrate Judge. See United States v. Cukaj, 2001 WL 1587410 at *1 (6 Cir. 2001) [Magistrate Judge may accept a guilty plea with the express consent of the defendant and where no objection to the report and recommendation is filed]; United States v. Torres, 258 F.3d 791, 796 (8 Cir. 2001); United States v. Dees, 125 F.3d 261, 263-69 (5 Cir. 1997); United States v. Ciapponi, 77 F.3d 1247, 1251 (10 Cir. 1996).
Prior to accepting defendant's plea, the undersigned addressed defendant personally and in open court and determined his competence to plead. Based on the observations of the undersigned, defendant understands the nature and meaning of the charges returned in the Indictment and the consequences of the plea to Count 4 of the Indictment. Defendant was also addressed personally and in open court and advised of each of the rights referred to in Rule 11 of the Federal Rules of Criminal Procedure.
Having engaged in the colloquy required by Rule 11, the Court concludes that defendant's plea is voluntary. Defendant acknowledged that the plea agreement signed by him, his attorney and the attorney for the United States and filed on January 10, 2014 represents the only promises made by anyone regarding the charges in the Indictment. Defendant was advised that the District Judge may accept or reject the plea agreement and that, even if the Court refuses to accept any provision of the plea agreement not binding on the Court, defendant may nevertheless not withdraw his guilty plea.
Defendant confirmed the accuracy of the material aspects of the statement of facts supporting the charge. He confirmed that he is pleading guilty to Count 4 of the Indictment because he is in fact guilty of the offense charged in Count 4 of the Indictment. The Court concludes that there is a factual basis for the plea.
The Court concludes that defendant's plea of guilty to Count 4 of the Indictment is knowingly and voluntarily made with understanding of the nature and meaning of the charge and of the consequences of the plea.
It is therefore RECOMMENDED that defendant Richard E. Nobles' guilty plea to Count 4 of the Indictment be accepted. Decision on acceptance or rejection of the plea agreement was deferred for consideration by the District Judge after the preparation of a presentence investigation report.