United States v. Gajo, Bogdan

In the

United States Court of Appeals

For the Seventh Circuit

No. 01-3975

United States of America,

Plaintiff-Appellee,

v.

Bogdan Gajo,

Defendant-Appellant.

Appeal from the United States District Court

for the Northern District of Illinois, Eastern Division.

No. 98 CR 100--Joan B. Gottschall, Judge.

Argued April 9, 2002--Decided May 20, 2002

Before Flaum, Chief Judge, and Coffey and

Kanne, Circuit Judges.

Flaum, Chief Judge. A jury convicted

Defendant-Appellant Bogdan Gajo of

conspiracy to commit arson in violation

of 18 U.S.C. sec. 371, solicitation to

commit arson in violation of 18 U.S.C.

sec. 373, arson in violation of 18 U.S.C.

sec. 844 (I), and mail fraud in violation

of 18 U.S.C. sec. 1341. Gajo appeals his

conviction, challenging two evidentiary

rulings related to the admission of tape

recorded statements and a witness’s grand

jury testimony. For the reasons stated

herein, we affirm.

I. Background

Gajo owned a business called Cragin

Sausage, which sold specialty ethnic

foods, beverages and cigarettes./1

OnJanuary 16, 1996, the building where

Cragin Sausage was located caught fire

and burned moderately. The fire was

concentrated in the rear kitchen and

storage area of Cragin Sausage. After the

fire was safely extinguished, Daniel

Cullen, who worked in the Fire

Department’s Office of Fire

Investigation, examined the property and

concluded that the fire was deliberately

set. Traces of gasoline were present in

debris samples taken from the scene, even

though there was no gasoline present in

the store prior to the fire. In addition,

Cragin Sausage’s rear southwest door,

which was the only door open at the time

of the fire, exhibited marks indicating

that the locks had been pried off from

the inside in an attempt to simulate a

forced entry. Three separate experts who

testified at trial reached this

conclusion: John Marcus, a private fire

investigator hired by one of Gajo’s

attorneys; Mark Boese, a forensic

scientist hired by Gajo’s insurance

company; and Cullen. Only Gajo and his

girlfriend, Maria Grazina Curylo, had

keys to Cragin Sausage. They were also

the only two people who knew the code to

the store’s security system, which never

activated during the fire. Approximately

one week after the fire, Gajo submitted

an insurance claim for the damage at

Cragin Sausage. Gajo later submitted a

proof of loss. The insurance company

eventually denied Gajo’s claim, although

the record is unclear regarding the exact

timing--a circumstance that will have

some import in our later discussion.

During the arson investigation,

government agents examined Cragin

Sausage’s outgoing telephone records,

which led them to an individual named Jay

Smith. Agents questioned Smith, who

ultimately agreed to cooperate with the

government. Smith recounted that in

December 1995, a former coworker named

Edward Baumgart approached Smith at his

place of employment (the Banks Grill) and

introduced him to Gajo. According to

Smith, Baumgart told him that "Gajo

needed a building burned down." Smith

also stated that although Gajo spoke

almost exclusively in Polish, Gajo told

him in English that burning down Cragin

Sausage "was urgent." Gajo and Baumgart

offered Smith $4,000 to set fire to

Cragin Sausage, but Smith declined.

Further investigation led agents to

several real estate agents, who testified

that Gajo listed the Cragin Sausage

property for sale and that Gajo was

desperate to sell his business to obtain

money. Indeed, one agent testified that

Gajo told him he wanted to sell Cragin

Sausage due to a lack of business./2

After the agent failed to sell the

property despite lowering the price, Gajo

suggested that the agent burn down Cragin

Sausage so Gajo could obtain the

insurance proceeds. The government also

presented evidence describing statements

Gajo made to investigators that were

inconsistent with eyewitness testimony.

Following the fire, Gajo told both Cullen

and an Alcohol, Tobacco and Firearms

("ATF") agent that he left Cragin Sausage

on Sunday afternoon at approximately 4:00

p.m. for a short vacation and that he did

not return to the store until after it

caught fire on Tuesday morning. However,

two neighbors testified that they saw

Gajo at Cragin Sausage on the day before

the fire. One witness observed Gajo

loading what appeared to be boxes of

liquor into the back of a minivan. Gajo

had also told investigators that liquor

was one of the classes of merchandise

missing from Cragin Sausage.

Approximately 10 months after the fire,

Smith contacted Baumgart at the direction

of a federal ATF agent. Smith and

Baumgart engaged in two conversations,

each of which was recorded and ultimately

introduced into evidence. On the first

tape, Baumgart responds to Smith’s

probing about what he should say to an

agent questioning him about the fire at

Cragin Sausage. Baumgart instructs Smith

to tell the investigating officer "to

fuck off." In the second conversation,

which occurred several minutes later,

Baumgart admits introducing Gajo to

Smith, but states that he does not know

who burned Cragin Sausage:

SMITH: This guy you introduced me to.

BAUMGART: Uh huh.

SMITH: . . . is he going to put me in a

bad spot?

BAUMGART: He’s not going to put you in a

bad spot, because if he would he’s gonna

go to jail. OK.

SMITH: Alright. OK. Alright.

BAUMGART: Cause right now he doing all he

can to get--

SMITH: . . . for my benefit what was this

asshole’s name?

BAUMGART: Gajo.

SMITH: Gajo, alright.

BAUMGART: G, A, J, O.

SMITH: Alright.

BAUMGART: Bogdan.

Later in the second tape, Baumgart

further instructed Smith about how to

respond if investigating agents asked who

set the fire. Baumgart stated, "Well,

you, you, you weren’t there. I wasn’t

there." Baumgart also told Smith, "You

don’t know a motherfuckin thing. Neither

do I."

At trial, Smith described his meeting

with Baumgart and Gajo at the Banks

Grill. During Smith’s cross-examination,

defense counsel established that Smith

could not remember if Gajo said anything

to him in English. Smith made this

admission despite testifying on direct

that Gajo said in English that burning

down Cragin Sausage was urgent. The

government addressed the issue on

redirect, but Smith still could not

recall Gajo’s precise words. The

government, over defense counsel’s

objection, then moved to admit Smith’s

grand jury testimony as substantive

evidence. The district court ruled that

Smith’s lack of memory as to what Gajo

said at the Banks Grill meeting was

inconsistent with his grand jury

testimony and admitted the transcripts.

The portions of the grand jury testimony

read to the jury revealed that Gajo

directly solicited Smith’s assistance,

that Gajo asked him in English to help

find someone to "torch" his business for

the "insurance money," and that Gajo told

Smith it was important that somebody burn

down Cragin Sausage. The jury convicted

Gajo, and Gajo appeals.

II. Discussion

In this appeal, Gajo challenges two of

the district court’s evidentiary rulings:

the decision to admit the tape recorded

conversations between Baumgart and Smith,

and the decision to admit as substantive

evidence Smith’s grand jury testimony. We

review the district court’s evidentiary

rulings for an abuse of discretion.

United States v. Smith, 230 F.3d 300, 307

(7th Cir. 2000). Even if a ruling is

erroneous, we will not overturn it unless

it is likely that the decision had "a

substantial influence over the jury."

Palmquist v. Selvik, 111 F.3d 1132, 1339

(7th Cir. 1997). Because of the special

deference we give to the trial judge’s

evidentiary rulings, we will not reverse

unless the record contains no evidence on

which the trial judge rationally could

have based its decision. United States v.

Walton, 217 F.3d 443, 449 (7th Cir.

1999).

A. Tape Recorded Conversations

Gajo first argues that the district

court erred in admitting the tape

recorded conversations between Baumgart

and Smith because those conversations do

not fall within the definition of

nonhearsay related to statements made by

a coconspirator. Federal Rule of Evidence

801(d)(2)(E) provides that a statement is

admissible and not hearsay if it is made

"by a coconspirator of a party during the

course and in furtherance of the

conspiracy." To justify admission of

coconspirator statements under FRE

801(d)(2)(E), the government must present

evidence that a conspiracy was in

progress at the time of the conversation

and that the statements were made "in

furtherance of" the conspiracy. United

States v. Curtis, 37 F.3d 301, 307 (7th

Cir. 1994). Gajo contends (1) that there

was no conspiracy in progress at the time

the recordings were made because the

conversations took place approximately 10

months after the fire, (2) that the

statements made on the tape recordings

were not in furtherance of the conspiracy

because the conversations’ content was

not related to obtaining insurance

proceeds, and (3) that Smith’s statements

should not have been admitted in any

event because he was never a member of

the conspiracy. In response, the

government maintains that Gajo’s counsel

waived any objection to the admission of

the tape recorded conversations. In the

alternative, the government argues that

sufficient evidence existed to establish

that the conspiracy was ongoing and that

Baumgart made the statements in

furtherance of that conspiracy.

The government’s waiver argument

requires further explanation. In pre-

trial motions, the parties

disputedwhether the tape recorded

conversations were admissible. The

government submitted a written Santiago

proffer, in which it set forth the facts

supporting the admission of the tape

recorded conversations pursuant to Rule

801(d)(2)(E). After extensive briefing,

the district court issued a written order

finding the tapes admissible. At trial,

the government moved to admit the tape

recorded conversations between Baumgart

and Smith, the district court inquired

whether Gajo had an objection, and

defense counsel responded "no." The

government now argues that defense

counsel’s affirmative response

constitutes waiver on appeal.

Resolution of this issue depends upon

whether the district court’s written

order was a definitive ruling. In Wilson

v. Williams, we considered whether an

objection at trial always is necessary

after an adverse ruling on a motion in

limine. We concluded that "a definitive

ruling in limine preserves an issue for

appellate review, without the need for

later objection--but this is just a

presumption, subject to variation by the

trial judge, who may indicate that

further consideration is in order." 182

F.3d 562, 563 (7th Cir. 1999); see also

Fed. R. of Evid. 103 (2002) ("Once the

court makes a definitive ruling on the

record admitting or excluding evidence,

either at or before trial, a party need

not renew an objection or offer of proof

to preserve a claim of error for

appeal."). Williams defined a definitive

ruling as one that does not require

further consideration and that does not

depend on how the trial proceeds. 182

F.3d at 566. In contrast, Williams

described a conditional ruling as one

that has effect only after a certain

condition is satisfied. Id. at 565. As an

example, we cited a situation where the

district court states that "if a litigant

testifies, then the adverse party will be

entitled to cross-examine in such-and-

such a way. Until the condition has been

satisfied by the testimony, the ruling

has no effect." Id.

In this case, the government maintains

that the district court’s decision was

conditional because the tape recorded

conversations were only admissible if the

government met the foundational

requirements of FRE 801(d)(2)(E), i.e.,

only if the government proved that a

conspiracy existed, and Baumgart and

Smith made the statements in furtherance

of the conspiracy. We disagree. Under the

government’s reasoning, all pre-trial

decisions would be considered

conditional, rendering the reasoning of

Williams and Rule 103 inapposite. A

district court always decides motions in

limine based upon representations made by

the parties concerning what the evidence

at trial will be, and every decision

depends--at least to some degree--on how

the evidence at trial unfolds. As a

result, a more appropriate inquiry is

whether the district court’s written

order in this case definitively settled

the issue of admissibility, and we

believe that it did. Indeed, after

finding the tape recorded conversations

generally admissible, the district court

held a subsequent hearing to determine

whether any portions should be redacted

and whether the statements were unduly

prejudicial under Federal Rule of

Evidence 403. Thus, the district court

prepared the transcripts for admission--a

decision that depended on the

government’s evidence at trial only in

the sense that the evidence be the same

as that set forth in the Santiago

proffer. We therefore find that Gajo

preserved the issue for appellate review.

With respect to the merits, we believe

the district court properly admitted the

tape recorded conversations between

Baumgart and Smith. As discussed above, a

statement is not hearsay and admissible

under FRE 801(d)(2)(E) if it is made by a

coconspirator "during the course and in

furtherance of the conspiracy." To be

admissible, then, the government must

establish by a preponderance of the

evidence two requirements: (1) a

conspiracy existed at the time of the

statements between the defendant and the

declarant, and (2) the statements

contributed to the ultimate goal of the

conspiracy. Bourjaily v. United States,

483 U.S. 171, 175 (1987); United States

v. Hunt, 272 F.3d 488, 497 (7th Cir.

2001). In this case, Gajo challenges

whether a conspiracy existed after the

fire at Cragin Sausage and whether the

statements were "in furtherance of" the

conspiracy’s ultimate criminal objective.

We first address whether the conspiracy

existed at the time of the tape recorded

conversations. By the time Smith

contacted Baumgart at the behest of an

ATF agent, ten months had passed since

the fire at Cragin Sausage. Relying on

Grunewald v. United States, 353 U.S. 391,

405 (1957), and its progeny, Gajo argues

that the time lapse between the fire and

the statements rendered the conspiracy to

commit arson complete at the time of the

Baumgart-Smith conversations. Grunewald

held that the act of concealment

typically is not part of a conspiracy’s

primary criminal objective. Once the

coconspirators achieve the goals of the

conspiracy, statements concerning acts of

concealment (or to avoid punishment) are

generally inadmissible. Id. at 405-06.

However, this principle does not extend

easily to the arson-for-profit context.

In United States v. Xheka, 704 F.2d 974,

986 (7th Cir. 1983), we held that the

primary goal of a conspiracy involving

arson is not only to destroy a building

by fire, but also to obtain the insurance

proceeds. In other words, unlike most

other criminal conspiracies, concealment

is actually one of the main criminal

objectives of an arson-for-profit scheme,

because it facilitates the primary

objective of fraudulently acquiring

insurance proceeds. Id. at 986 ("The

conspiracy continues until defendants

obtain the insurance money or abandon

their quest."); see also United States v.

Doyle, 771 F.2d 250, 255-56 (7th Cir.

1985); United States v. Zabic, 745 F.2d

464, 473 (7th Cir. 1984).

Based on the foregoing, resolution of

this issue would be clear except for one

additional factor. The record in this

case does not reveal when Gajo’s

insurance company denied his claim or

whether the claim remained pending at the

time of the Baumgart-Smith statements.

Despite this absence, there was

sufficient evidence to find that the

conspiracy to obtain insurance proceeds

was ongoing 10 months after the fire.

First, in August 1996, Gajo gave

deposition testimony in a civil lawsuit

related to the fire at Cragin Sausage and

Gajo’s insurance claims. Second, Baumgart

made at least one statement in October

1996--"it looks like the fuckin’ case is

still going on"--that suggests the

conspiracy was ongoing. Third, there is

no dispute that at the time of the

October 1996 conversations, "Gajo had not

yet received [the] insurance proceeds."

United States v. Gajo, No. 98 CR 100, at

5 (N.D. Ill. May 20, 1999) (R. 38 at 5).

In contrast, the only evidence that the

conspiracy had ended was the parties’

stipulation that the insurance company

had denied Gajo’s claim sometime after he

submitted a proof of loss on July 3,

1996./3 But this stipulation lacked a

specific date, rendering it irrelevant to

the question of whether the conspiracy

existed at the time of the tape recorded

conversations. From this evidence, the

district court was within its discretion

to conclude that a conspiracy still

existed at the time of the Baumgart-Smith

conversations.

We next address whether Baumgart’s

statements were "in furtherance of" the

conspiracy--an inquiry that requires

examination of the statements’ content.

We consider statements to be "in

furtherance of" the conspiracy when they

promote the conspiracies objectives,

Bourjaily, 483 U.S. at 175, i.e., when

the statements are "part of the

information flow between conspirators to

help each perform a role." Hunt, 272 F.3d

at 495 (quoting United States v. Johnson,

927 F.2d 999, 1002 (7th Cir. 1991)). In

this case, Gajo objects to the admission

of two statements, each of which relates

to Baumgart’s attempts to instruct Smith

to remain quiet about the meeting between

Baumgart, Smith and Gajo. Gajo submits

that although the conversations reveal

"an attempt to cover what had transpired

at the meeting," there is no indication

that Baumgart was part of the conspiracy

to obtain insurance proceeds.

We decline to accept Gajo’s contention

that the specific mention of insurance

proceeds is a necessary condition for

admissibility of a coconspirator’s

statements in this context. In our view,

Gajo’s assertion ignores one of the

primary objectives of the crime in this

case. As we have already discussed, an

arson-for-profit scheme has two criminal

objectives: the destruction of a building

by fire and the attainment of insurance

proceeds. However, a necessary corollary

to the insurance scam is that the co-

conspirators must conceal their illegal

conduct from law enforcement and

insurance investigators. See Zabick, 745

F.2d at 472-73; Xheka, 704 F.2d at 986.

Thus, Baumgart’s statements advanced the

conspiracy’s goal of falsely acquiring

insurance proceeds, but only in the sense

that concealment was a necessary

predicate to achieving that criminal

objective. Because Baumgart’s statements

reflect an attempt to avoid detection, he

was furthering one of the conspiracy’s

goals. See United Sates v. Kaden, 819

F.2d 813, 820 (7th Cir. 1987).

Finally, Gajo submits that the district

court abused its discretion in allowing

the jury to hear Smith’s statements. Gajo

argues that because Smith was never a

member of the conspiracy, his statements

were not admissible under FRE

801(D)(2)(E). After ruling the Baumgart-

Smith conversations admissible, the

district court acknowledged the problems

associated with admitting Smith’s

declarations:

. . . given that the conversations in

question were instigated by a non-

conspirator cooperating with the

government and given that many subjects

not clearly germane to the objectives of

the conspiracy were discussed (such as

Smith’s questions about whether anyone

was harmed), the court will hear argument

on the issue of whether any portions of

the conversations should be redacted . .

. .

United States v. Gajo, No. 98 CR 100 at

7-8. At this subsequent hearing, the

district court redacted significant

portions of the conversation between

Baumgart and Smith, leaving the jury to

hear only those statements that provided

context to Baumgart’s responses.

As a general proposition, the statements

of a non-conspirator are not admissible

under Rule 801(d)(2)(E). See Xheka, 704

F.2d at 986 n. 6 ("As [the informer] was

acting on behalf of the government there

is no question that his statements cannot

be admitted under Rule 801(d)(2)(E).");

United States v. Williamson, 53 F.3d

1500, 1519 (10th Cir. 1995) ("the

statements of the witness (the person to

whom the out-of-court statements were

made) are not admissible under this rule,

but only the statements of the declarant/

coconspirator that were made to the

witness"). However, this is not a case

where the district court admitted Smith’s

statements as non-hearsay, but rather to

provide context to a coconspirator’s

statements properly admitted under Rule

801. It is well settled that such an

approach is appropriate because

statements are not hearsay to the extent

they are offered for context and not for

the truth of the truth of the matter

asserted. See United States v. Davis, 890

F.2d 1373, 1380 (7th Cir. 1989); see also

United States v. Gutierrez-Chavez, 842

F.2d 77, 81 (5th Cir. 1988) (statements

on tape recording admissible "for the

limited purpose of putting the responses

of the appellant in context and making

them ’intelligible to the jury and

recognizable as admissions.’") (quoting

United States v. Lemonakis, 485 F.2d 941,

948 (D.C. Cir. 1973)); United States v.

Price, 792 F.2d 994, 997 (11th Cir. 1986)

(statements admitted "to make

understandable to the jury the statements

made by" the defendant); United States v.

Whitman, 771 F.2d 1348, 1352 (9th Cir.

1985) (no hearsay problem when tape

recorded statements introduced to aid

jury in understanding defendant’s

statements); United States v. Williams,

604 F.2d 1102, 1108 (8th Cir. 1979) ("the

tape-recorded conversation was not

hearsay because it was admitted to

provide context for [the defendant’s] end

of the conversation."). Thus, while it is

true that a district court should

exercise great caution when admitting a

non-conspirator’s statements to provide

context to admissible declarations, we

find that the district court did not

abuse its discretion in this case. The

district court included only those

statements necessary to provide meaning

to Baumgart’s responses and redacted the

non-germane and unduly prejudicial

aspects of the Baumgart-Smith

conversations.

B. Grand Jury Testimony

Gajo also submits that the district

court abused its discretion when it

admitted as substantive evidence a

transcript of Smith’s grand jury

testimony. During Smith’s cross-

examination, Smith admitted that he could

not remember whether Gajo spoke to him in

English during the Banks Grill meeting.

This cast some doubt on Smith’s direct

testimony that Gajo had told him in

English that burning down Cragin Sausage

was urgent./4 In response, the

government moved to admit Smith’s grand

jury testimony, arguing that it was

inconsistent with Smith’s trial

testimony. Before the grand jury, Smith

had testified that Gajo told him in

English that burning Cragin Sausage was

"really important," that Gajo had to

"have this done," and that Gajo needed

the building burned for "insurance

money." The district court admitted this

portion of the grand jury testimony,

ruling that although the court could not

determine if Smith was lying on the

stand, his lack of memory could be

considered an inconsistent statement

under Rule 801. Gajo now challenges this

decision.

Federal Rule of Evidence 801(d)(1)

provides that a statement is not hearsay

if "the declarant testifies at the trial

or hearing and is subject to cross-

examination concerning the statement, and

the statement is (A) inconsistent with

the declarant’s testimony, and was given

under oath subject to the penalty of

perjury at a trial, hearing, or other

proceeding, or in a deposition." Id. See

also United States v. Keeter, 130 F.3d

297, 302 (7th Cir. 1997). Because a trial

witness’s grand jury testimony is not

hearsay and is admissible as substantive

evidence when it is inconsistent with his

trial testimony, the issue we must

address is whether a lack of memory at

trial qualifies as an inconsistent

statement. In United States v. DiCaro,

772 F.2d 1314 (7th Cir. 1985), and United

States v. Williams, 737 F.2d 594 (7th

Cir. 1984), we addressed this issue and

suggested that memory loss is an

appropriate justification for admitting

prior grand jury testimony. Each case,

however, involved a "turncoat" witness

who effectively lied on the stand to

avoid testifying at trial. Indeed, in

DiCaro, we identified an underlying

concern in both cases that "a

recalcitrant witness might defraud both

the parties and the court by feigning a

lack of memory." DiCaro, 772 F.2d at

1322. Gajo attempts to seize this

language and narrow the applicability of

Rule 801(d) (1)(A) to situations

involving a witness whose lack of memory

is attributable to recalcitrance or other

improper motives.

We first note that no court has

addressed the precise issue presented by

this appeal. To be sure, many circuits--

including this one in Williams and

DiCaro--have held that in the context of

the recalcitrant witness, a lack of

memory is inconsistent with the

description of specific details before

the grand jury. See United States v.

Milton, 8 F.3d 39, 46-47 (D.C. Cir.

1993); United States v. Bigham, 812 F.2d

943, 946 (5th Cir. 1987); United States

v. Russell, 712 F.2d 1256, 1258 (8th Cir.

1983); United States v. Marchand, 564

F.2d 983, 999 (2d Cir. 1977). In

contrast, only one court has suggested

that a prior statement should not be

admitted under Rule 801(d)(1)(A) if a

witness genuinely cannot remember crucial

facts related to the prior statement. See

United States v. Palumbo, 639 F.2d 123,

128 n. 6 (3d Cir. 1981) (dicta).

After reviewing these precedents, we

decline to adopt Gajo’s narrow reading of

Rule 801(d)(1)(A). Beyond the difficulty

in administering such a rule, nothing in

DiCaro or Williams suggests that the

holdings in those cases should be limited

to the turncoat witness. Indeed, Williams

instructs that the term "inconsistent" in

Rule 801(d)(1)(A) should not be confined

to "statements [that are] diametrically

opposed or logically incompatible," and

that inconsistency "may be found in

evasive answers, . . . silence, or

changes in positions." 737 F.2d at 608

(citing United States v. Dennis, 625 F.2d

782, 795 (8th Cir. 1980)); see also

United States v. Distler, 671 F.2d 954,

958 (6th Cir. 1981) ("when a witness

remembers events incompletely, or with

some equivocation at trial, it is not

improper to admit a prior statement that

otherwise complies with the limitations

of Rule 801(d)(1), if that prior

statement indicates that at an earlier

time the witness remembered the events

about which he testifies with more

certainty or in more detail.")./5

Moreover, we believe that the district

court is in a better position to evaluate

the "multitude of factors" that help

determine whether a witness’s trial

testimony is truly inconsistent with his

or her prior grand jury testimony. See

Williams, 737 F.2d at 608; DiCaro, 772

F.2d at 1321; see also Dennis, 625 F.2d

at 795 ("The trial judge has considerable

discretion in determining whether

testimony is ’inconsistent’ with prior

statements.").

Here, the trial judge found that Smith’s

trial testimony (where he could not

remember what Gajo said to him in

English) was inconsistent with his grand

jury testimony (where Smith specifically

recounted what Gajo said). The trial

judge also ruled that this was the only

inconsistency and limited the

introduction of the grand jury testimony

accordingly. We believe this was the

appropriate course of action. In some

cases, a witness’s genuine lack of memory

may be inconsistent with his prior

testimony, which naturally occurred

closer in time to the actual events

described. Because we believe the trial

judge is in the best position to make

that determination, we find that the

district court did not abuse its

discretion in admitting limited portions

of Smith’s grand jury testimony.

III. Conclusion

The district court did not abuse its

discretion in admitting the tape

recorded conversations between Baumgart

and Smith or in admitting Smith’s prior

grand jury testimony. As a result, we

AFFIRM Gajo’s conviction.

FOOTNOTES

/1 We recount the facts presented at trial in the

light most favorable to the government. United

States v. McGiffen, 267 F.3d 581, 584 (7th Cir.

2001).

/2 Gajo rebutted the inferences generated by this

testimony by introducing evidence of a substan-

tial settlement he received following the death

of his wife.

/3 Gajo filed the initial insurance claim on January

24, 1996. The proof of loss included a sworn

statement and supporting documentation related to

the initial claim.

/4 The direct examination between Smith and the

prosecutor proceeded as follows:

Q: Did Mr. Gajo himself speak English to you?

A: If he did--yes.

Q: Do you recall what he said?

A: It was urgent.

Q: What was urgent?

A: To get this building burned.

Q: When he said that it was urgent, was he

speaking Polish?

A: No, English.

Tr. of Proceed. at 372-73.

/5 Although Distler did not explicitly involve a

"turncoat" witness, the court implicitly suggest-

ed that many of the employee-witnesses had a

motive to feign lack of memory, i.e., that their

boss was a close friend of the defendant.