United States v. Dispoz O Plastics

Opinions of the United

1999 Decisions States Court of Appeals

for the Third Circuit

4-8-1999

USA v. Dispoz O Plastics

Precedential or Non-Precedential:

Docket 98-1135,98-1136

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Filed April 8, 1999

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

Nos. 98-1135 and 98-1136

UNITED STATES OF AMERICA

v.

DISPOZ-O-PLASTICS, INC.,

Appellant in No. 98-1135

and

PETER IACOVELLI,

Appellant in No. 98-1136

On Appeal from the United States District Court

for the Eastern District of Pennsylvania

(D.C. Criminal Action Nos. 96-cr-00280-2 and 4)

District Judge: Honorable Anita B. Brody

Argued September 14, 1998

Before: STAPLETON and ROTH, Circuit Judges

LONGOBARDI,1 District Judge

(Opinion filed: April 8, 1999)

_________________________________________________________________

1. Honorable Joseph J. Longobardi, United States District Court Judge

for the District of Delaware, sitting by designation.

Joel I. Klein

Assistant Attorney General

A. Douglas Melamed

Deputy Assistant Attorney General

John J. Powers, III, Esq.

Robert B. Nicholson, Esq.

John P. Fonte, Esq. (Argued)

Antitrust Division

U.S. Department of Justice

601 D. Street, N.W.

Washington, D.C. 20530

Scott D. Hammond, Esq.

Antitrust Division

U.S. Department of Justice

950 Pennsylvania Avenue, N.W.

Washington, D.C. 20530

Attorneys for Appellee

Theodore B. Olson, Esq. (Argued)

Miguel A. Estrada, Esq.

Jacqueline E. Coleman, Esq.

Gibson, Dunn & Crutcher LLP

1050 Connecticut Avenue, N.W.

Washington, D.C. 20036-5306

Attorneys for Appellants

OPINION OF THE COURT

ROTH, Circuit Judge.

Peter Iacovelli and his company, Dispoz-O-Plastics, Inc.

("Dispoz-O"), appeal from a judgment of conviction entered

in the United States District Court for the Eastern District

of Pennsylvania. Iacovelli and Dispoz-O were convicted of

conspiracy to fix prices in the plastic cutlery industry in

violation of 15 U.S.C. S 1. Their claims on appeal include

the following: (1) that the District Court erred in admitting

evidence that government witnesses had been convicted of

2

conspiracy to fix prices with Dispoz-O, (2) that the District

Court erred in determining that the government's vouching

for its witnesses by referring to extra-record prosecutorial

policy constituted harmless error, and (3) that the District

Court failed to declare a mistrial on the grounds that the

government vouched for its witnesses by saying they had

no motive to lie about whether they conspired tofix prices.2

We will affirm the judgment of the District Court regarding

appellants' first and third claims, the admissibility of the

co-conspirators' convictions and the prosecutor's comments

regarding the government's witnesses' motives to lie.

However, we find that the prosecutor's extra-record

comment about prosecutorial policy constitutes reversible

error. We will therefore reverse the judgment of the District

Court and remand this case for a new trial.

I. FACTS

Dispoz-O is an American manufacturer of disposable

plastic cutlery, including knives, forks, and spoons. Peter

Iacovelli is Dispoz-O's president, CEO, and sole

stockholder. One type of plastic cutlery that Dispoz-O

manufactures is medium-weight polypropylene cutlery, a

popular flexible type of cutlery that is less expensive than

stiffer polystyrene cutlery. Two of Dispoz-O's competitors in

the medium-weight polypropylene cutlery ("plastic cutlery")

industry are Amcel Corp. ("Amcel"), headed by Lloyd Gordon,3

and Polar Plastics Manufacturing, Ltd. ("Polar"), headed by

Andrew Liebmann and Basem Atallah.

_________________________________________________________________

2. We have considered the remaining contentions raised by Iacovelli and

Dispoz-O and conclude that the District Court's treatment of them did

not amount to reversible error. These remaining claims are that the

government used first-person pronouns in its opening and closing

statements to describe itself as a protagonist in the investigative

process

and to present its beliefs and conclusions to the jury, and that in its

closing statement the government impermissibly commented on

Iacovelli's failure to testify and it referred to FBI equipment used to

investigate telephone numbers that was not introduced at trial.

3. Iacovelli and Dispoz-O were tried jointly with co-defendants Amcel and

Lloyd. All defendants were convicted of conspiracy to fix prices. Only

Iacovelli and Dispoz-O appeal.

3

Dispoz-O, Iacovelli, Amcel, and Gordon were charged with

conspiracy to fix prices in the plastic cutlery industry. The

charges centered on a meeting held at a restaurant at

LaGuardia Airport in November 1991. Prior to the meeting,

in October 1990 and May 1991, Gordon had sent copies of

Amcel's recent price increases to Dispoz-O and Polar. In

October 1991, Gordon met privately at a trade show with

Liebmann and Atallah and later with Iacovelli and Albert

Postrel, Dispoz-O's sales representative, to convince them to

follow each other in making price increases. At that time,

Iacovelli requested a meeting with representatives of Amcel

and Polar to discuss pricing. He also contacted Michael

Kennedy, head of the parent corporation of another plastic

cutlery competitor, Winkler Products, to discuss"get[ting] a

price increase." Kennedy declined to discuss pricing with

Iacovelli.

The meeting at LaGuardia Airport was attended by

Gordon, Iacovelli, Liebmann, and Atallah. According to the

testimony of Liebmann and Atallah, Iacovelli outlined then-

existing costs, and the group agreed that prices were too

low. Atallah suggested that the group set a price minimum

under which they would not go in order to prevent

customers from playing the manufacturers against each

other. Price increases in the industry were usually set as

percentages because customers had varying deals with the

manufacturers and often received prices that were

discounted from standard price ranges. However, the

LaGuardia group agreed to fix truckload prices at specific

levels: $4.75 per case for forks, spoons, and knives, $5.00

for soup spoons, and $5.25 for combination fork/spoon

("spork") cutlery; they resolved not to offer discounts below

those levels.

Atallah said that another competitor, Jet Plastica, should

be asked to join the agreement if it was to be successful.

Gordon agreed to approach Jet Plastica's principal about

the plan. Atallah volunteered to increase its pricesfirst and

then send copies of its letter notifying customers of the

price increases to Gordon and Iacovelli. During the meeting,

Iacovelli told Liebmann and Atallah to refrain from taking

notes and to pay for meeting expenses with cash to avoid

creating any record of the meeting.

4

After the meeting, Atallah drafted the letter and an

explanatory memo for his sales force. He instructed his

secretary that, before she disseminated the letter to

customers, she should fax copies of the letter to Amcel and

Dispoz-O without the "Polar" fax banner. A few days later,

Gordon faxed a signed price letter with identical increases

to Polar and Dispoz-O; although sent by Gordon, these

faxes bore the fax banner of an unrelated company, M.B.

Financial. Later that day, Dispoz-O issued an increase

letter listing the same prices. Unlike Amcel's and Polar's

letters, however, Dispoz-O's letter did not announce the

prices as a "floor" below which no discounts would be

granted. Moreover, Dispoz-O did not adhere to such a

"floor" after its letter was sent out; in fact, it did still

discount or rebate some of its sales, although not as

extensively as before.

Iacovelli set the price increases without Postrel's

customary input. He assured Postrel that the increase

would "stick," as Gordon also assured one of his sales

managers. The price increases "stuck" from January 1992

to early March 1992, when Atallah notified Iacovelli and

Gordon that he was going to lower Polar's prices. Although

Iacovelli and Gordon tried to dissuade him, Atallah refused

to continue with the agreement because he claimed to be

losing too much business to Jet Plastica, which had not

joined the agreement.

Later, the FBI questioned Iacovelli and Gordon, who lied

about their contacts with competitors. Iacovelli denied that

he had ever discussed prices with competitors, either in

meetings or on the telephone, and he claimed that he had

never received pricing information from a competitor by fax.

Subsequently, Gordon contacted Iacovelli and Atallah to

arrange a cover-up.

The government indicted Dispoz-O, Iacovelli, Amcel, and

Gordon for conspiracy to fix prices. At trial, the

government's two main witnesses were Liebmann and

Atallah. These two had previously pled guilty to conspiracy

to fix prices in the plastic cutlery industry and to an

unrelated conspiracy to fix prices in the plastic cups

industry. The testimony of Liebmann and Atallah was

crucial to the government's case because the primary issue

5

at trial was whether Liebmann, Atallah, Gordon, and

Iacovelli had reached an agreement to fix prices. The

government's documentary evidence revealed only general

information such as the timing and frequency of telephone

calls among the parties and the fact that the parties had

faxed their price letters to each other. Liebmann and

Atallah's testimony was necessary to establish the subject

matter of the discussion at LaGuardia, as well as of the

other communications between the parties, and thereby to

demonstrate that the competitors were conspiring tofix

prices.

The theory of the defense was that the LaGuardia

meeting and the other communications related to merger

and joint-venture discussions rather than to illegal price-

fixing. The defense presented evidence of merger and joint-

venture discussions between industry manufacturers

during that time, as well as introducing planning

documents which analyzed Dispoz-O as a potential partner

for Amcel. The defense also produced evidence that

communications between manufacturers about their pricing

was advisable, given customers' attempts to play the

manufacturers against each other. Because the topic of

conversation at the LaGuardia meeting was so vital to both

sides, the credibility of Liebmann and Atallah was key.

At the close of the trial, the prosecutor argued during

summation:

Now, first with regard to the sweetheart deal. You

heard the testimony of Liebmann and Atallah, you can

decide whether or not you think they felt that was a

sweetheart deal. They went to jail and they pled guilty

to both counts.

Common sense tells you people don't confess to a

crime, they don't turn a completely innocent, legitimate

business meeting into a crime, they don't confess to

crimes they didn't commit and that's what the

defendants are trying to tell you they did.

Now obviously they got credit for their cooperation;

that's the way it works. But that misses the point. Why

would Liebmann and Atallah say they fixed prices at

LaGuardia? Why would they tell that to the

6

Government, who would they tell that to the judge who

sentenced them? Why would they tell that to their

customers, their customers, if it didn't happen? Think

about that.

They told the Government they fixed prices twice and

I can guarantee you the Justice Department doesn't

give two for one deals; they had to plead guilty to both

price fixing conspiracies and their sentence reflected

that.

On the basis of these remarks, the defendants moved for

a mistrial. The court held a hearing and issued an opinion

denying defendants' motion. The court determined that the

prosecutor's reference to the guilty pleas of Liebmann and

Atallah was made in response to defendants' argument that

the witnesses' guilty pleas provided a motive for them to lie.

The court gave two curative instructions to the jury,

explaining how the pleas could and could not be used.

In its post-trial Order and Explanation, the District Court

concluded that, even if the prosecutor's comments had

been improper, they constituted harmless error because of

the overwhelming evidence of defendants' guilt. The court

further found that the prosecutor's comment that the

witnesses were sentenced for "two price fixing conspiracies"

was not extra-record vouching because of testimony at trial

that the witnesses had pled guilty and were sentenced for

two crimes. The court also found the prosecutor's reference

to a purported government policy against offering"two-for-

one" deals to constitute vouching. However, it deemed the

"conspiracies" and "two-for-one" comments to be harmless

error in light of the context of the trial and the

overwhelming evidence against defendants.

The District Court had jurisdiction over this action

pursuant to 18 U.S.C. S 3231 and 15 U.S.C.S 1. See United

States v. Gaev, 24 F.3d 473, 474 n.1 (3d Cir. 1994).

Dispoz-O filed a timely appeal. We have jurisdiction

pursuant to 28 U.S.C. S 1291.

7

II. DISCUSSION

A. The Guilty Pleas

The first issue we will consider is whether the District

Court erred in admitting the co-conspirators' guilty pleas.

The government contends that Dispoz-O and Iacovelli

waived their objections to the admissibility of the pleas.

Our standard of review of a trial court's decision to admit

evidence of a co-conspirator's convictions is for abuse of

discretion. United States v. Universal Rehabilitation

Services, No. 97-1412, 1999 WL 62512, at *9 (3d Cir. Feb.

11, 1999); Gaev, 24 F.3d at 476; Bruno v. W.B. Saunders

Co., 882 F.2d 760, 766 (3d Cir. 1989).

Dispoz-O and Iacovelli moved in limine to exclude

evidence of the guilty pleas as unduly prejudicial, arguing

that the crime necessarily involved more than one

participant and that the defendants and the witnesses had

been charged with the same conspiracy.4 The government

countered that the cutlery plea evidence should be

admitted to explain the witnesses' motivation to testify and

the circumstances surrounding their appearances in court.

Defense counsel offered not to attack the witnesses'

credibility on the claim that Liebmann and Atallah were

given leniency by being allowed to avoid charges on the

cutlery conspiracy. Counsel further offered not to argue to

the jury that the witnesses got a "sweetheart deal because

the Government let them slide on cutlery." The government

countered that the jury would nevertheless be left with the

misleading impression that the witnesses received leniency

on the cutlery charge. The court asked defense counsel if

he would be willing to avoid admission of evidence of both

the cups and cutlery pleas. He answered, "That's not going

to happen, judge."

Regarding the cutlery pleas, defense counsel conceded,

"[T]his whole problem is because it's a conspiracy. If it

wasn't a conspiracy, it wouldn't be a problem. If there was

_________________________________________________________________

4. In their pre-trial brief, defendants specifically noted that they did

not

object to the introduction of the witnesses' guilty pleas to conspiracy in

the plastic cups industry.

8

a substantive offense of price fixing and these guys pled

guilty to price fixing, I wouldn't care about it, but it's

because it takes two to tango, and there's them and there's

us." The judge asked, "Could we carve something out that

would deal with this somewhat, to say instead of that they

pled guilty to conspiracy, that they pled guilty to price

fixing in these two areas?" Defense counsel replied, "That

would be very helpful. That would deal with a major

problem." Noting that removal of the word "conspiracy"

from the price-fixing pleas sounded "reasonable," the judge

nevertheless stated, "I'm not ruling on that." The judge

again asked defense counsel if removal of "conspiracy"

would suffice: "That will be eliminated. All right. The

present status of that, does that have you satisfied . . .?"

Counsel replied, "It does, yes."

The plea agreements were then redacted to eliminate the

term "conspiracy" and read simply that Liebmann and

Atallah would plead guilty to fixing the price of plastic

cutlery and cups. The redacted plea agreements were

admitted into evidence without objection. Although the

court's subsequent written order stated that the motion in

limine was granted in part and denied in part, the order

also stated that the disposition of the motion was"as stated

on the record of July 3, 1997."

Defense counsel in fact did use the term "conspiracy" on

several occasions during his cross-examination of

Liebmann and Atallah. Then, at the outset of his closing

argument, the prosecutor for the first time used the word

"conspiracy," stating that Liebmann and Atallah had pled

guilty "to both price fixing conspiracies." When the

argument was completed and the jury had left the

courtroom, defense counsel moved for a mistrial, asserting

that the court had "ruled out" admission of evidence

regarding pleading guilty to two conspiracies. The judge

replied, "I didn't rule it out, it's what you both agreed to."

Defense counsel acknowledged, "Yes."

A waiver is the "intentional relinquishment or

abandonment of a known right." United States v. Olano,

507 U.S. 725, 733, 113 S.Ct. 1770, 123 L.Ed.2d 508

(1993); see United States v. Goldberg, 67 F.3d 1092, 1099

(3d Cir. 1995), quoting Johnson v. Zerbst, 304 U.S. 458,

9

464, 58 S.Ct. 1019, 82 L.Ed. 1461 (1938). Once waived, a

claim is not preserved for appellate review. See Olano, 507

U.S. at 733-734; United States v. Yu-Leung, 51 F.3d 1116,

1120 (2d Cir. 1995), aff 'd sub nom. Ruotolo v. United

States, 133 F.3d 907 (2d Cir.), cert. denied , 118 S.Ct. 1852,

140 L.Ed.2d 1101 (1998); see also United States v. Lakich,

23 F.3d 1203, 1207 (7th Cir. 1994) (relying on Olano);

United States v. Gomez, 67 F.3d 1515, 1520 (10th Cir.

1995) (citing Olano and Lakich). Where a claim has not

been definitively ruled upon, a moving party must object

during trial to preserve that claim for appellate review.

Bruno, 882 F.2d at 767-68; accord Walden v. Georgia-Pacific

Corp., 126 F.3d 506, 517-19 (3d Cir. 1997); cert. denied,

118 S.Ct. 1516, 140 L.Ed.2d 669 (1998); American Home

Assurance Co. v. Sunshine Supermarket, Inc., 753 F.2d 321,

324-25 (3d Cir. 1985).

At trial, when the government presented the redacted

guilty pleas, Iacovelli and Dispoz-O did not object. Under

the facts as presented, we conclude that no definitive

pretrial ruling was made on the admissibility of the pleas

and that the failure of defense counsel to object to their

admission resulted in a waiver of the issue. To the extent

that defense counsel objected to the one-time use of the

term "conspiracy" by the prosecutor during his summation,

that one objection does not appear to be directed at the

admission into evidence of the redacted plea agreements.

Moreover, the next morning the court gave a curative

instruction to explain to the jury the purpose for which the

pleas could be considered:

[B]y stipulation of the parties it was agreed before the

trial that Andrew Liebmann and Basem Atallah had

pled guilty to fixing prices of plastic cutlery and not to

a conspiracy to fix prices. As I will instruct you later in

the charge, you are not to draw an inference of the

guilt of any of the defendants in this case from the fact

that other people have pled guilty to similar charges.

In this appeal, Iacovelli and Dispoz-O, in their opening

brief, set out in the Statement of Issues as thefirst one:

"Whether reversal of appellants' convictions is required

because the district court erroneously admitted evidence

that other individuals already had been convicted as a

10

result of the events for which appellants were on trial?" The

appellants then stated that this issue "was raised before

trial by motion in limine, (JA 30), and was argued and

ruled upon at a conference held on July 3, 1997, just

before the trial began." Iacovelli and Dispoz-O are bound by

this description of the issue. Consequently, we conclude

that the issue of the admissibility of the convictions and of

the pleas leading to them was not preserved for appellate

review.

B. Vouching

Dispoz-O's next claim is that the prosecutor vouched for

Liebmann and Atallah during closing argument and that

the district court erred in not granting a mistrial. We

"review a district court's decision not to grant a mistrial on

the grounds that the prosecutor made improper remarks in

closing argument for abuse of discretion." United States v.

Molina-Guevara, 96 F.3d 698, 703 (3d Cir. 1996).

There are two instances of vouching in the prosecutor's

closing statement. The one we will review first is the

prosecutors' comment on a purported plea policy of the

Department of Justice. We find it to have been improper,

and, because we find it was not harmless error, it warrants

reversal. We conclude, however, that the second set of

remarks, which addressed the witnesses' testimony about

the LaGuardia meeting, was within the permissible bounds

of advocacy.

"Vouching constitutes an assurance by the prosecuting

attorney of the credibility of a Government witness through

personal knowledge or by other information outside of the

testimony before the jury." United States v. Walker, 155

F.3d 180, 184 (3d Cir. 1998). Vouching is distinguishable

from a personal opinion based on the evidence presented at

the trial. United States v. DiLoreto, 888 F.2d 996, 999 (3d

Cir. 1989), overruled on other grounds, United States v.

Zehrbach, 47 F.3d 1252 (3d Cir. 1995) (en banc).

A prosecutor may not try to buttress his case by

vouching for the credibility of a government witness.

Molina-Guevara, 96 F.3d at 704. As we noted in Molina-

Guevara, the Supreme Court discussed the dangers of

11

vouching in United States v. Young, 470 U.S. 1, 18-19, 15

S.Ct. 1038, 84 L.Ed.2d 1 (1985). The Court stated the

following:

843<!>The prosecutor's vouching for the credibility of

witnesses and expressing his personal opinion

concerning the guilt of the accused pose two dangers:

such comments can convey the impression that

evidence not presented to the jury, but known to the

prosecutor, supports the charges against the defendant

and can thus jeopardize the defendant's right to be

tried solely on the basis of the evidence presented to

the jury; and the prosecutor's opinion carries with it

the imprimatur of the Government and may induce the

jury to trust the Government's judgment rather than

its own view of the evidence.

Id.

During the closing, the prosecutor commented on a

purported policy of the Department of Justice. The

prosecutor stated, "They told the Government they fixed

prices twice and I can guarantee you the Justice

Department doesn't give two for one deals; they had to

plead guilty to both price-fixing conspiracies and their

sentence reflected that."5

We ruled that comments similar to that of the prosecutor

here were improper vouching in United States v. DiLoreto,

888 F.2d 996 (3d Cir. 1989), a case involving conspiracy to

distribute narcotics. The government witnesses were drug

dealers who had entered into plea bargains. The defense

attorneys strongly attacked the credibility and bias of the

witnesses by arguing that the witnesses were testifying only

because of "their own benefits, by their own interests, by

their own motives" relating to their deals with the

government. Id. at 998. During closing rebuttal, the

prosecutor stated in part:

_________________________________________________________________

5. As discussed above, we conclude that Iacovelli and Dispoz-O waived

their objections to the admission of evidence of the witnesses' guilty

pleas. For that reason, the discussion in this section concerns only the

reference in the government's remarks to the plea bargain policy of the

Department of Justice.

12

And you also heard that they have a plea bargain, and

you heard what happened when that plea bargain is

not fulfilled. If they lie, that bargain is off. That's it, no

bargain. We don't take liars. We don't put liars on the

stand. We don't do that.

Id. (emphasis added).

On appeal, we reversed,6 stating:

By this language in his closing rebuttal statement, the

prosecutor asserted to the jury that the government

does not use liars as witnesses in its cases. . . . No

explanation was given, however, of how the government

ascertains the honesty or veracity of its witnesses.

Indeed, we have found nothing in the record upon

which the prosecutor could have grounded his

statement. There must then have been some other

evidence, unknown or unavailable to the jury, which

convinced the prosecutor that his witnesses were not

liars. Obviously, the defendants were not confronted

with this extraneous evidence and afforded cross-

examination, nor was the jury given an opportunity to

engage in its own evaluation. What the jury was led to

do instead was merely to infer that other information

existed, which the government used to verify the

credibility of its witnesses prior to introducing their

testimonies at trial.

Id. at 999.

Here, the prosecutor similarly tried to buttress the

credibility of cooperating witnesses by providing extra-

record information. His remark about the purported policy

of the Department of Justice not to give "two-for-one deals"

was meant to convince the jury that the prosecutor knew

that the witnesses were telling the truth -- that the

department would not give a deal in return for the two

guilty pleas unless it was convinced that there were two

_________________________________________________________________

6. In DiLoreto, we used a per se rule to determine whether reversal was

required. 888 F.2d at 999. We overruled DiLoreto 's per se rule in our en

banc decision in United States v. Zehrbach, 47 F.3d 1252, 1267 (3d Cir.

1995). However, we did not overrule the result reached in DiLoreto,

reversing the convictions. Zehrbach, 47 F.3d at 1255 n.1.

13

price fixing offenses and that Liebmann and Atallah were

criminally involved in both of them. The jury was led to

infer that the government had information with which they

were able to confirm that Liebmann and Atallah were

truthful in their recitations of their involvement and also

that of the other "conspirators," i.e., Iacovelli, Dispoz-O,

Gordon, and Amcel. The inference was, therefore, that the

department had verified the existence of both conspiracies,

but there was no explanation of how the department had

made this verification.7 Without such an explanation,

Iacovelli and Dispoz-O were deprived of the chance to cross-

examine. Moreover, the jury may have been persuaded by

this language to find that the witnesses' statements

implicating Iacovelli and Dispoz-O were accurate and, thus,

that Iacovelli and Dispoz-O were guilty. See DiLoreto, 888

F.2d at 1000. For this reason, the prosecutor's extra-record

remark constituted vouching.

Even if a prosecutor is found to have vouched for a

government witness, however, the government may

defensively invoke the "invited response" doctrine in an

_________________________________________________________________

7. Judge Stapleton considers it unlikely that a juror would infer from the

government's reference to a policy against two-for-one deals that the

Justice Department "had verified the existence of both conspiracies." He

nevertheless concludes that this reference provides impermissible

support for the veracity of Liebmann and Atallah and that this

prosecutorial misconduct was not harmless.

In Judge Stapleton's view the defense properly argued to the jury that

Liebmann and Atallah decided to perjure themselves about (and plead

guilty to) a non-existent plastic cutlery conspiracy because they expected

that, as a result of doing so, they would receive less punishment than

they would receive if they confessed only to the plastic cup conspiracy

(i.e., a sweetheart deal). The prosecutor's reference to a policy against

two-for-one deals was tendered in an attempt to counter this argument.

This reference was intended to suggest that, when Liebmann and Atallah

confessed to the FBI participation in a second conspiracy, they were

speaking against their own interests because they knew that, under

Justice Department policy, a second confession would necessarily lead to

a second indictment and two sentences based on the two crimes. There

was no record evidence, however, from which a juror could conclude that

a policy against two-for-one deals existed, or, accordingly, that it

played

a role in the decisions of Liebmann and Atallah to confess to the second

conspiracy.

14

attempt to prevent reversal. The invited response doctrine

covers comments made in "reasonable response to improper

attacks by defense counsel." Walker, 155 F.3d at 186 n.5,

quoting United States v. Pungitore, 910 F.2d 1084, 1126 (3d

Cir. 1990); United States v. Pelullo, 964 F.2d 193, 218 (3d

Cir. 1992). The doctrine's rationale is that "the unfair

prejudice flowing from the two arguments may balance

each other out, thus obviating the need for a new trial."

Walker, 155 F.3d at 186 n.5 (quoting Pungitore, 910 F.2d at

1126). A prosecutor may use the doctrine defensively, but

not offensively, as a "springboard" launching affirmative

attacks upon defendants. Id.; Pelullo , 964 F.2d at 218.

The government claims that its "guarantee" was in proper

response to specific comments of defense counsel in

opening and closing arguments about the "sweetheart deal"

that the witnesses landed in the plastic cups case by

inventing the price fixing in cutlery. Defense counsel

asserted that, in order to get shorter sentences than the

ones they were already facing for the plastic cups

conspiracy, Liebmann and Atallah lied by telling the

government that defendants were involved in a cutlery

conspiracy. Counsel did not accuse the prosecution of

participating in the alleged lie. Rather, defense counsel

asserted that the witnesses confirmed the suspicions which

the prosecution had about price fixing of cutlery, based on

the fact that telephone calls had been made and that the

meeting at LaGuardia had been held. Referring to the

witnesses' alleged fabrications, counsel stated,"Does that

mean that these prosecutors are coming in here and selling

a lie? No, it doesn't."

Unless the defense had made direct attacks on the

prosecution or on other law enforcement officials, we

cannot say that the prosecutor's comment about the

Justice Department's purported plea bargaining policy was

permissible under the invited response doctrine. We have

generally found the invited response doctrine to be

applicable only in instances where the prosecution team

was attacked for reasons unsupported by the evidence at

trial. See United States v. Gambino, 926 F.2d 1355, 1364-

66 (3d Cir. 1991) (comments including assertion that

government suborned perjury); United States v. Pungitore,

15

910 F.2d 1084, 1127 (3d Cir. 1990) (personal attacks on

integrity of prosecutors and law enforcement officers); see

also Pelullo, 964 F.2d at 217-18 (comment that government

suborned perjury); United States v. Curtis, 683 F.2d 769,

778 (3d Cir. 1982) (comment that government avoided

questioning witness about entrapment allegations); cf.

Young, 470 U.S. at 9 ("Defense counsel, like his adversary,

must not be permitted to make unfounded and

inflammatory attacks on the opposing advocate.").8

Moreover, we have distinguished between an attack on

the testimony given by a government agent and a situation

where the prosecution is accused of putting on a case

which it knew was false. In the former situation, we found

the invited response doctrine to be inapplicable. See Molina-

Guevara, 96 F.3d at 705. In Molina-Guevara , defense

counsel attacked the credibility of a government agent who

testified. The defense urged the jury to consider that the

agent -- whose "frustrating" job it was to catch criminals

who sometimes "g[o]t away" -- was"human" and may have

"erred," "stretched," or even "lied" when testifying about the

drug bust at issue. Id. at 701-02. In turn, the prosecutor

vouched for the agent by saying that it would be"insulting"

and "ridiculous" for the jury to assume that the United

States would present a witness who would lie and that the

agent "did not lie to you." Id. at 704.9 We determined that

the government's statements were not excused under the

invited response doctrine because defense counsel's

comments fell within the bounds of "vigorous advocacy

entirely appropriate for a case that turned on the jury's

assessment of the credibility of the witnesses." Id. at 705.

_________________________________________________________________

8. The government cites the Second Circuit's decision in United States v.

Eltayib, 88 F.3d 157, 173 (2d Cir. 1996) to support its argument that it

properly responded to defense counsel's attacks that"impugned the

integrity of [its] case." Unlike the instant case, however, the defense in

Eltayib directly attacked the prosecution, asserting that it had

fabricated

an informant's testimony. Id.

9. The prosecution also argued that another agent, if called as a witness,

would have corroborated the testifying agent's story. The case was

reversed because we found that comment to be violative of the

Confrontation Clause of the Sixth Amendment. Molina-Guevara, 96 F.3d

at 702-03.

16

Here, defense counsel did not directly attack the

538<!>prosecution. Although defense counsel attacked the

witnesses' credibility based on their possible motivation to

plead guilty and to testify, defense counsel did not suggest,

for instance, that the prosecutor was suborning perjury.

Consequently, the prosecution's comment did not qualify as

an invited response.

Because we find that the invited response doctrine is not

applicable, we must next evaluate the vouching to

determine whether it constituted harmless error. Zehrbach,

47 F.3d at 1264. This Court en banc has held that

vouching that is aimed at the witness's credibility and is

based on extra-record evidence is deemed non-

constitutional error. Id. at 1265.10

Non-constitutional error is considered harmless when"it

is highly probable that the error did not contribute to the

_________________________________________________________________

10. Iacovelli and Dispoz-O cite a recent Supreme Court case, Gray v.

Maryland, 523 U.S. 185, 118 S.Ct. 1151, 140 L.Ed.2d 294 (1998), to

support their proposition that the prosecutor's vouching here is

constitutional error, violating the Sixth Amendment. They claim that

Gray overruled Zehrbach. However, the language in Gray does not extend

to prosecutorial vouching. In Gray, the Supreme Court extended its

ruling in Bruton v. United States, 391 U.S. 123, 88 S.Ct. 1620, 20

L.Ed.2d 476 (1968). Bruton was found guilty after the confession of a

non-testifying co-defendant was admitted at a joint trial. Because the

confession named and incriminated Bruton, the Court found that its

admission violated Bruton's Sixth Amendment rights despite a limiting

instruction to the jury that the confession should only be considered as

evidence against the defendant who had confessed. Gray extended that

protection to a defendant faced with the admission of such a confession

by a codefendant when the confession was redacted by substituting a

blank space or the word "deleted" for the defendant's name. Gray, 118

S.Ct. at 1153. The decision in Gray focuses on "powerfully incriminating

extrajudicial statements of a codefendant," id. at 1155 (quoting

Richardson v. Marsh, 481 U.S. 200, 207 (1987)), which are "so

prejudicial that limiting instructions cannot work." Id. Vouching, as a

category of statements, does not necessarily rise to the same level of

prejudice as does the type of redacted confession involved in Gray. In

many instances of vouching, curative instructions do indeed neutralize

the improper statement. See, e.g., Zehrbach, 47 F.3d at 1267. We

conclude that our determination that vouching is non-constitutional

error does not run afoul of Gray.

17

judgment." Id., quoting Government of Virgin Islands v. Toto,

529 F.2d 278, 284 (3d Cir. 1976). "High probability" is

found where the court has a "sure conviction that the error

did not prejudice" the defendant. Zehrbach , 47 F.3d at

1265, quoting United States v. Jannoti, 729 F.2d 213, 219-

20 (3d Cir.), cert. denied, 469 U.S. 880, 105 S.Ct. 243, 244,

83 L.Ed.2d 182 (1984). The test for determining prejudice

is tripartite. The factors to be examined are the scope of the

comments and their relationship to the proceeding, the

extent of any curative instructions, and the strength of the

evidence against defendants. Zehrbach, 47 F.3d at 1265.

Here, the prosecution depended on testimony from

Liebmann and Atallah to establish that the discussions

with defendants at the LaGuardia meeting were about price

fixing. The prosecution claimed that the parties entered into

an agreement to fix prices at LaGuardia. The defense

argued and presented evidence that they were meeting for

the permissible purpose of discussing a joint venture or

merger. The credibility of Liebmann and Atallah was a

crucial issue which both sides addressed during their

closing arguments.

The "two-for-one" comment was made toward the end of

the prosecutor's closing argument. Immediately after the

prosecutor finished, the court excused the jury. Amcel's

defense counsel then moved for a mistrial, primarily

objecting to the prosecutor's reference to the witnesses'

guilty pleas as involving a conspiracy. Iacovelli and

Dispoz-O joined in Amcel's objections and objected

specifically to the vouching comment. At this point, the

judge only commented on the "conspiracy" reference --

resolving to address it during the jury charge and advising

the prosecutors that they had a chance to cure any harm

during their rebuttal, which was about to begin. Later, at

the end of the government's rebuttal, the judge dismissed

the jury until the next day, and defense counsel renewed its

motion for a mistrial. The judge denied the motion, subject

to revisiting it after trial if defendants were convicted. The

next day, at the beginning of its charge to the jury, the

judge specifically addressed the "conspiracy" issue, but not

the "two-for-one" comment.

18

Although the law assumes that jurors follow the

instructions they receive, Richardson v. Marsh , 481 U.S.

200, 206, 107 S.Ct. 1702, 95 L.Ed.2d 176 (1987), the

circumstances surrounding the curative instructions are to

be examined under the Zehrbach test. First, the

instructions given here were not specifically directed to the

statements of the prosecutor. Instead, the judge generally

instructed the jury to evaluate the credibility of witnesses

who pled guilty because they might be motivated to lie. The

judge told the jury that an important way of determining

whether the government had proved defendants guilty

beyond a reasonable doubt was to evaluate the witnesses'

testimony. The jury was not informed, however, that the

prosecutor's statement about bargaining policy could not be

considered as evidence. The instructions, thus, were not

curative of the prosecutor's comment, see Government of

Virgin Islands v. Mujahid, 990 F.2d 111, 116 (3d Cir. 1993),

and we are not convinced that they adequately neutralized

the harm caused by the prosecutor's reference to the

government's policy in making "two-for-one" deals.

The final factor to be considered is the closeness of the

case. During its closing, the prosecution made it clear that

Liebmann's and Atallah's testimony was central to the

strength of its case: "[Y]ou have heard from roughly 18

witnesses and seen hundreds of documents, but this case

still comes down to that one issue: did the defendants

secretly meet at LaGuardia, Andrew Liebmann and Basem

Atallah, and agree to fix prices on cutlery or instead did

they meet to discuss a three-way joint venture?" 11 Later,

asserting that an agreement need not be reached in writing

and could be established "by a wink of an eye," he stated,

"And that is why the issue is what happened at LaGuardia

because once the agreement is reached, the crime is

complete." Then, after describing the LaGuardia meeting

according to Liebmann's and Atallah's testimony, the

prosecutor told the jury:

_________________________________________________________________

11. The prosecutor went on to state that the phone records, faxes, and

other documents "corroborate" the witnesses' testimony. The final

component of his proof was evidence that establishing that Iacovelli lied

to the FBI and testified falsely.

19

That's the agreement. At that point in time the crime

was committed, the crime was complete. Those

defendants and Polar fixed prices, they are guilty of

price fixing. Nothing else has to be shown in order to

convict them of price fixing.

Now, what happened afterwards is additional proof

that they fixed prices. And you'll see, there is plenty

more proof, but the agreement, the agreement was

reached at LaGuardia.

The witnesses' testimony was clearly central to the

government's case. Without it, the prosecution could not

establish that there was an agreement to fix prices. The

defense, recognizing that, endeavored to develop an

alternative theory of the discussions and sharing of pricing

information. We find the crucial nature of the witnesses'

testimony to be an important factor in determining whether

the prosecutor's remark was prejudicial. See Molina-

Guevara, 96 F.3d at 705. When we consider the

significance of Liebmann and Atallah's credibility and

compare that to the general nature of the court's

instructions, we are not left with the "sure conviction that

the error did not prejudice the defendant," Zehrbach, 47

F.3d at 1265. Consequently, Iacovelli and Dispoz-O's

convictions cannot stand.

Dispoz-O also challenges as vouching a second portion of

the government's closing, during which the prosecutor

stated as follows:

Common sense tells you people don't confess to a

crime, they don't turn a completely innocent, legitimate

business meeting into a crime, they don't confess to

crimes they didn't commit and that's what the

defendants are trying to tell you they did.

Now obviously they got credit for their cooperation;

that's the way it works. But that misses the point. Why

would Liebmann and Atallah say they fixed prices at

LaGuardia? Why would they tell that to the

Government, why would they tell that to the judge who

sentenced them? Why would they tell that to their

customers, their customers, if it didn't happen? Think

about that.

20

Dispoz-O objects to the first part of these remarks on the

ground that the prosecutor expressly told the jury that

Liebmann's and Atallah's convictions conclusively

established the criminality of the LaGuardia meeting. The

nature of these remarks was an appeal to the jury's

common sense regarding the witnesses' credibility. Because

the remarks were a request to the jury to view the evidence

in the light most favorable to the prosecutor's case, they

were not improper. Walker, 155 F.3d at 189.

Dispoz-O also contends that the prosecutor's reference to

Liebmann's and Atallah's statements that they fixed prices

at LaGuardia constituted vouching. However, a review of

the record reveals that Liebmann and Atallah testified that

they fixed prices at LaGuardia and that the defense

challenged the truth of their testimony. Because the

prosecutor's remark about fixing prices referred to evidence

presented in the record, it does not constitute vouching.

United States v. Dolasco, 470 F.2d 1297, 1299 (3d Cir.

1972).

III. CONCLUSION

For the foregoing reasons, we will reverse the judgment of

the District Court and remand this case for a new trial for

Iacovelli and Dispoz-O.

A True Copy:

Teste:

Clerk of the United States Court of Appeals

for the Third Circuit

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