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UNITED STATES COURT OF APPEALS
For the Fifth Circuit
No. 92-7566
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
VERSUS
DONALD HOOKER AND
DONALD RAY REED,
Defendants-Appellants.
Appeals from the United States District Court
For the Northern District of Mississippi
(July 26, 1993)
Before KING, HIGGINBOTHAM, DeMOSS, Circuit Judges.
DeMOSS, Circuit Judge:
I. PROCEDURAL HISTORY
Donald Hooker (Hooker) and Donald Ray Reed (Reed) were charged
in a six-count indictment with conspiring to distribute crack
cocaine in violation of 21 U.S.C. 壯 812, 841(a)(1), 841(b)(1)(C),
and 846 (count 1), aiding and abetting each other in distributing
crack cocaine in violation of 21 U.S.C. 壯 812, 841(a)(1), and
841(b)(1)(C) (count 2), carrying and using firearms in the
conspiracy in violation of 18 U.S.C. 壯 2 and 924(c) (count 3), and
using firearms while kicking and assaulting a state narcotics

officer who was acting as a federal officer in violation of 18
U.S.C. 壯 111 and 1114 (count 4). Reed alone was charged with
being a convicted felon in possession of firearms in violation of
18 U.S.C. 壯 922(g)(1) and 924 (count 5), and knowingly possessing
a firearm with removed or altered serial numbers in violation of 18
U.S.C. 壯 922(k) and 924 (count 6). Both Hooker and Reed were
convicted on all of the counts on which they were charged, and they
now appeal those convictions.
The defendants contend the district court erred (1) in failing
to instruct the jury with regard to a knowledge requirement for
Count 6, (2) in failing to dismiss their conviction on Count 4
because there was insufficient proof to establish that a state
officer was acting as a federal officer, (3) by improperly applying
the Federal Sentencing Guidelines with regard to Count 4, and (4)
by allowing the government to introduce evidence of their prior
drug related activity when that evidence violated Federal Rules of
Evidence 403 and 404(b). We reverse Reed's conviction on Count 6
and affirm all other convictions for both Hooker and Reed.
II. FACTS
In January 1992, three federal agencies, the Federal Drug
Enforcement Administration (DEA), the Federal Bureau of Alcohol,
Tobacco, and Firearms (ATF), and the Federal Bureau of
Investigations (FBI) began an investigation of Reed, which involved
allegations of drug trafficking and firearms violations. The DEA
was the lead agency and coordinated the investigation. However,
because the DEA had only three officers at its Oxford, Mississippi
2

office, it enlisted the help of the Mississippi Bureau of Narcotics
(MBN) and the North Central Mississippi Drug Task Force (Task
Force). The agents also obtained the assistance of Kenny Pepper
(Pepper), who was an informant who claimed to have previously
purchased drugs from Reed and offered to obtain further evidence
for the investigation.
On January 29, 1992, nine state and local agents, supervised
by DEA agent Arliss Swindoll, met with Pepper and arranged for him
to purchase drugs from Reed. The plan was for MBN officer Elbert
Craig (Craig) to accompany Pepper and pose as his "Uncle Al." The
agents fitted Pepper with a hidden tape recorder and transmitter so
that they could later use the taped conversations for evidence.
Around 8:00 p.m. on January 29, Craig and Pepper went to
Reed's house in Belzoni, Mississippi. The house was surrounded by
a chain link fence containing pit bull dogs and it had security
doors at all three entrances. Craig stayed in the car while Pepper
approached the house and spoke to Reed. Pepper explained that one
of his cousins had referred him to Reed as someone from whom he
could purchase drugs. Reed asked Pepper what he wanted. Pepper
said a gram, to which Hooker, who was standing nearby, replied "a
gram of cain?" Reed said "I really don't deal," and walked outside
and down the street where he spoke with someone in a car.
In the meantime, Pepper and Hooker continued talking. When
Reed returned to the house, he asked Pepper if Hooker got him the
dope. Pepper said no, and Reed then talked privately with Hooker.
Shortly thereafter, Hooker asked Pepper how much he wanted. Pepper
3

replied, "a sixteenth to start off." Hooker told Pepper a gram
would cost "one hundred forty" and that a sixteenth would cost "one
hundred sixty." Hooker and Reed then stepped aside while Pepper
observed Hooker remove his baseball cap and put it back on. Hooker
then asked Pepper to walk down the street with him. They walked
about a half a block when Hooker removed his cap, took a rock of
cocaine out of the band of the cap, and handed it to Pepper.
Hooker then motioned for Pepper to put the money in the cap, which
he did, and Hooker put the cap back on his head. Pepper told
Hooker he would be back the next day for another purchase.
On January 30, 1992, the agents, along with a second DEA
agent, met to prepare for a second drug buy from Hooker and Reed.
The agents also prepared to execute a search warrant of Reed's
house, which they were going to serve after the second buy. Craig
and Pepper arrived at Reed's house around noon, whereupon Pepper
entered the house and asked Reed for drugs. Reed told him to talk
to Hooker, who had agreed to sell him the drugs. Hooker told
Pepper he was first going to search him for "wires." Pepper
refused and returned to the car and he and Craig drove away.
While riding in the car, Craig told Pepper to remove the
recorder and transmitter, which he did, and go back in the house.
Craig then drove back to the house. While Craig stayed in the car,
Pepper approached the house. Unbeknownst to Craig and Pepper,
Hooker and Reed had followed them as they drove around the block.
Hooker and Reed arrived at the house just after Pepper and Craig.
Hooker approached Pepper from behind and told him to go in the
4

house. Once inside the house, Reed and Hooker asked Pepper if he
was "the police." Pepper denied that he was, but Reed left the
room and came back holding two guns and ordered Pepper in the
bathroom. While Reed held a gun to Pepper's head, Hooker searched
him, but found nothing. Reed then told Dalton Handy1 to bring in
"Uncle Al,"2 which he did.
As Craig prepared to enter the house, he clipped onto his belt
a transmitter, which was made to look like a pager, and radioed to
the surveillance team that he was going into the house. When Craig
stepped inside the house, he saw Reed with a gun in his belt and
one arm behind his back. Reed pulled the gun from his belt and
another from behind his back and told Craig and Pepper that they
were not leaving. Reed put a cocked, loaded gun to Craig's
forehead and ordered him into the bathroom. In the bathroom, Reed
made Craig get on his knees and he put a gun to the back of his
head. Reed kicked Craig twice in the ribs with his boot while
telling him "if you're the . . . police, were gonna kill you."
Hooker went and searched the car and returned with Craig's
walkie-talkie, tape recorder, and pistol. Hooker ordered Craig to
stand up so he could be searched. Hooker patted Craig down and
found Craig's other pistol in an ankle holster. Hooker asked Craig
where he got the gun. When he replied on the streets, Hooker said
"you're a damn liar . . . . This is a police gun." Hooker ordered
1 Dalton Handy was present at Reed's house during the
incident. He was indicted on Count 4, but the jury acquitted
him.
2 Craig, of course, was Uncle Al.
5

Craig back on his knees and kicked him twice more saying "let me
kill him. Let me kill the . . . police." Reed told Hooker "not
here at my house. Lets take him to the woods." While Hooker
pointed a pistol at Craig's skull, Hooker and Reed argued whether
they should kill Craig in the woods or at the house.
Meanwhile, unbeknownst to Hooker and Reed, the surveillance
team had heard the conversation and were racing to the house.
While still on his knees, Craig heard someone rattle the doorknob
on the side door. He looked over and saw one of the surveillance
team agents looking through a small window by the door. Reed,
apparently having heard the agents, suddenly changed his demeanor
saying "I'm going to call the Sheriff, . . . [and] tell him I've
got two men over here at my house with guns." Immediately
thereafter, the agents burst into the house and arrested Hooker and
Reed.
Later that day, the agents brought a search warrant and
searched the house. Their search revealed three sets of scales,
which contained cocaine residue, cocaine residue on the kitchen
counter and the microwave, inositol and baking soda, which are used
to cook powder cocaine into "crack," holsters and ammunition for
firearms, a police scanner, a cellular telephone, sandwich bags
with the corners cut off, which contained cocaine residue, $1,333
in cash, an identification card with Reed's picture but bearing the
name of Luther Howard, a photograph of Reed sitting at a table with
large sums of money and a gun in each hand, and a receipt made out
to Hooker for $40,850 in cash that had been seized by the Alachua
6

County Sheriff's Office from Hooker and Reed near Gainseville,
Florida on December 17, 1991.
III. DISCUSSION
1. Did the District Court Err in Instructing the Jury as to
Count 6?
Reed contends that the district court erred in not instructing
the jury, as to his conviction under 18 U.S.C. 壯 922(k) and 924,
that it had to find that Reed knew the two guns he used against
Craig had their serial numbers altered or removed for them to
convict him. For support, Reed primarily relies on the language of
the statutes, the Ninth Circuit's opinion in United States v.
Sherbondy,3 and this court's opinion in United States v. Anderson.4
Section 922(k) provides:
[i]t shall be unlawful for any person
knowingly to transport, ship, or receive, in
interstate or foreign commerce, any firearm
which has had the importer's or manufacturer's
serial number removed, obliterated, or altered
or to possess or receive any firearm which has
had the importer's or manufacturer's serial
number removed, obliterated, or altered and
has, at any time, been shipped or transported
in interstate or foreign commerce.5
Reed interprets � 922(k) to mean that the word knowingly, in
the first part of the provision, modifies both the acts of
transporting, shipping, and receiving firearms in interstate or
foreign commerce and the acts of possessing or receiving any
3 865 F.2d 996, 1001 (9th Cir. 1988).
4 885 F.2d 1248 (5th Cir. 1989)(en banc).
5 18 U.S.C. � 922(k).
7

firearms shipped or transported in interstate or foreign commerce,
which are listed in the second part of the provision.
On the other hand, the government argues that the word
knowingly modifies only the acts of transporting, shipping, and
receiving firearms in interstate or foreign commerce, which are
listed in the first part of the provision. In the second part of
that section, which prohibits the acts of possessing or receiving
firearms that at any time have been shipped or transported in
interstate or foreign commerce, the word knowingly is omitted.
Therefore, the government argues � 922(k) makes a distinction
between firearms being directly transported, shipped, or received
in interstate commerce and firearms that have at any time in the
past been shipped or transported in interstate commerce, and
requires a knowing violation for the former, but not for the later.
In our view, any ambiguity created by the language of � 922(k)
is cleared up by � 924(a)(1)(B), which provides the penalty for
violations of section 922(k). Section 924(a)(1)(b) applies by its
terms only when the defendant "knowingly violates" � 922(k).
In Sherbondy6, the Ninth Circuit held that an analogous
statute, 18 U.S.C. � 922(g)(1), requires a knowing violation.
Section 922(g)(1) makes it "unlawful for any person who is under
indictment for, or who has been convicted in any court of, a crime
punishable by imprisonment for a term exceeding one year; . . . to
ship or transport any firearm or ammunition in interstate or
foreign commerce." Punishment for a violation of � 922(g)(1), like
6 865 F.2d 996 (9th Cir. 1988).
8

� 922(k), is provided under � 924(a)(1)(B). In Sherbondy, the
court concluded that "it is highly likely that Congress used
section 924(a) simply to avoid having to add `willful' or `knowing'
into every subsection of section 922. Under section 924(a)(1)(B)
we conclude an `unknowing' act cannot constitute a violation of
section 922(g)."7 The Ninth Circuit's holding in Sherbondy
supports our conclusion in the present case that the language in
the second part of subsection (k), which like subsection (g) does
not expressly have a knowledge requirement, still requires a
knowing violation because of the knowledge requirement in �
924(a)(1)(B).
In United States v. Anderson,8 we overruled our previous
holding in United States v. Vasquez9 by holding that a conviction
of possession of unregistered firearms under the National Firearms
Act requires the government to prove that the defendant knew the
items in question were "firearms" under the Act, not merely that
the items in question were "firearms" within the general meaning of
the term,10 even though neither the Act, 26 U.S.C. � 5861(d), nor
the penalty provision of the Act, 26 U.S.C. � 5871, required a
knowing violation. In Anderson, this court concluded that it
wanted to move away from the "Circuit precedent permitting
7 865 F.2d 996, 1002 (9th Cir. 1988).
8 885 F.2d 1248 (5th Cir. 1989)(en banc).
9 476 F.2d 730 (5th Cir.), cert denied, 414 U.S. 836 (1973).
10 885 F.2d 1248 (5th Cir. 1989).
9

conviction of certain felonies without proof of mens rea."11 Since
this court required a knowing violation in Anderson, which involved
a statute silent as to any knowledge requirement, clearly we should
require a knowing violation in a statute whose penalty provision
expressly requires a knowing violation, such as � 922(k).
Therefore, we hold a conviction under � 922(k) requires not only
knowing possession of a firearm, but also knowledge that the serial
numbers on a firearm have been altered or removed, as of the time
of the possession.
The government advances three independent arguments to support
upholding the jury charge. First, the government contends that
ordinarily a defendant need not know that his act is specifically
illegal to commit a knowing violation, so long as the defendant
knows factually that he is doing the prohibited act.12 According
to the government, it is illogical and naive to assume that a drug
dealer like Reed was unaware that the serial numbers on his
firearms were altered or removed. The government's argument,
however, does not address the question whether the statute
requires, as a matter of law, that Reed knew the serial numbers had
been altered or removed. Instead, its argument addresses the
credibility of the witness, which is an issue for the jury and is
not relevant to our determination of the requirements of the
statute.
11 885 F.2d at 1249.
12 U.S. v. Baker, 807 F.2d 427 (5th Cir. 1986).
10

Second, the government contends that Reed waived and withdrew
his request for an instruction that to convict him the jury was
required to find that he knew the serial numbers had been altered
or removed. Reed requested and submitted to the district court an
instruction, which stated "even if you find beyond a reasonable
doubt, that Donald Ray Reed possessed firearms with the serial
numbers obliterated . . . you may not convict him of this count
unless you also find, beyond a reasonable doubt, that he knew at or
before his possession of such firearms that these weapons had no
serial numbers." To support its conclusion that Reed waived this
instruction, the government relies on a colloquy concerning the
jury instructions in which one of Reed's attorneys stated to the
court, "I think simple possession of [a firearm] is sufficient."
The government contends the only fair conclusion to draw from
the attorney's statement is that Reed intended to waive and
withdraw that instruction. However, Reed's other attorney later in
the same colloquy stated, "[y]our Honor, if we could just modify
[the instruction] just to make it a little more clear that, when it
says 'knowingly' in [the instruction] the way it's written now,
it's referring also to the fact [Reed has] to know that it did not
have a serial number or an obliterated serial number." The
conflicting statements by Reed's two attorneys do not lead us to
conclude that Reed waived the instruction. Our conclusion is
11

buttressed by the fact that the district court subsequently went on
to refuse the proffered instruction.13
Third, the government contends that Reed admitted he knew the
serial numbers had been altered or removed, and therefore any error
in failing to instruct the jury that to convict Reed it was
required to find that he had knowledge that the serial numbers had
been altered or removed is harmless. The government points to the
testimony of ATF agent Don Medley, who testified that Reed told him
after he was arrested that "the two handguns with the serial
numbers messed up had been stolen and when they were returned in
their presence (sic), they were in their present condition." The
government also cites the exchange at trial between the U.S.
Attorney and Reed, whereby Reed discussed his theory as to how the
serial numbers were removed.14
13 The jury charge for Count 6 in part reads as follows:
In order to find the defendant Donald Ray
Reed guilty of possessing a firearm with an
obliterated or altered serial number, you
must be satisfied that the Government has
proved each of the following elements: First,
that on or about the dates set forth in the
indictment, the defendant Donald Ray Reed
knowingly possessed at least one of the
firearms described in Count 6 of the
indictment; second, that the importer's or
manufacturer's serial number had been
removed, obliterated, or altered; and, third,
that said firearm had previously been shipped
or transported in interstate commerce, that
is, across state lines.
14 The exchange went as follows:
U.S. Attorney: You gave those agents an explanation of how those
serial numbers got filed off those guns, didn't you?
Reed: No. I gave my theory how they got off. I don't really
12

The government contends if the facts underlying the
instruction are not contested, as it asserts they are here, the
instruction is unnecessary and the failure to give it will not be
error.15 From the record, it is difficult for this court to
determine whether Reed admitted he knew the guns' serial numbers
had been removed so as to dispense with the necessity of an
instruction. Reed may have been admitting that he knew the serial
numbers were missing before his arrest or he may simply have been
admitting that he knew as of the time of trial that they were
missing. If it is an admission of his knowledge of the missing
serial numbers before his arrest, the court's failure to instruct
the jury is probably harmless. If he is admitting his knowledge at
the time of trial, however, the admission is meaningless. From our
reading of the record and the context in which the statement was
made, we can not affirmatively say that Reed admitted that he
learned that the serial numbers were missing before his arrest.
Given our confusion as to the significance to attach to Reed's
statements, we will not hold that his statements rendered the
district court's erroneous instruction harmless.
know how they got off. That was just a thought.
U.S. Attorney: Just a theory?
Reed: Right. It was a thought.
U.S. Attorney: Isn't it a fact that you told them those guns
were stolen?
Reed: Right. I told them --
U.S. Attorney: And when they were returned, the serial numbers
were missing?
Reed: Yes sir. Which they was.
15 See United States v. Heath, 978 F.2d 879 (5th Cir. 1992).
13

We hold that 18 U.S.C. 壯 922(k) and 924 require a jury to
find that a defendant knew the serial numbers had been removed
before it can convict him. Since this crucial element was omitted
from the jury instruction after Reed requested it, we reverse his
conviction as to Count 6.
2. Was Craig a Federal Agent for Purposes of 18 U.S.C. 壯 111
and 1114?
Hooker and Reed contend that Craig was not a federal agent
under the provisions of 18 U.S.C. 壯 111 and 1114, and therefore
their convictions must be reversed. Hooker and Reed concede that
the operation that led to their arrest was began by the DEA,
involved several FBI and ATF agents, was headed by Agent Swindoll
of the DEA, and from the beginning was to be prosecuted in federal
court. However, Hooker and Reed contend the operation was a "state
operation" because it was financed mostly on state and local money
and the majority of the officers at the "pre-buy" meeting and the
subsequent surveillance operations were state and local officers.
Hooker and Reed cite numerous cases holding that a state officer
who is assisting a federal investigation is a "federal officer"
under 壯 111 and 1114, and then attempt to distinguish the present
case from those cases.
The government points out that the two DEA agents
participating in the operation were two-thirds of all the DEA
agents assigned to cover the 37 county area encompassing the
Northern District of Mississippi. Because it is so short-handed,
the government contends the DEA relies heavily on local and state
14

support in almost all of its investigations. Therefore, the
government contends the mere fact that the number of state officers
involved in the operation outnumbered the number of federal
officers is not relevant to Craig's status as a federal agent. The
government also relies on the case of United States v. Williamson,16
which takes an expansive view of what a federal agent is for
purposes of 壯 111 and 1114.
In Williamson, a state narcotics agent was assisting two
federal agents in an undercover narcotics investigation. While the
state officer tried to arrest the defendant, the defendant
attempted to run the officer over with his car. The defendant was
prosecuted and convicted for forcibly assaulting a federal officer
in violation of � 111. On appeal, the defendant argued that the
state officer was not a federal agent, which was required to
sustain his conviction. This court disagreed, holding that "since
. . . [the state officer] was acting in cooperation with and under
control of federal officers, in effecting an arrest for violation
of the federal drug laws, assault against him was within the
coverage of � 111."17 In the present case, Craig was acting in
cooperation with federal officers in a federal operation when he
was assaulted. Applying the holding in Williamson, Craig easily
fits within the coverage of 壯 111 and 1114.
16 482 F.2d 508 (5th Cir. 1973).
17 Id. at 512. See also United States v. Chunn, 347 F.2d
717, 721 (4th Cir. 1965); United States v. Heliczer, 373 F.2d
241, 249 (2nd Cir.), cert. denied, 388 U.S. 917 (1967).
15

3. Did the District Court Err in Applying the Federal
Sentencing Guidelines?
Hooker and Reed contend that the district court erred in two
respects in applying the Sentencing Guidelines to their convictions
under Count 4 (kicking and assaulting with firearms a state
narcotics officer while he was acting as a federal officer). They
contend that they were improperly sentenced under Guideline � 2A2.2
and that they were improperly given a three point increase under �
3A1.2.
First, Hooker and Reed argue the district court erred by
applying Guideline � 2A2.2,18 which applies to aggravated assault
and provides an offense level of 15, instead of applying Guideline
� 2A2.4, which applies to obstructing or impeding officers and
provides an offense level of six. Their argument relies on the
language of � 2A2.4(b)(1), which provides "[i]f the conduct
involved physical contact, or if a dangerous weapon (including a
firearm) was possessed and its use was threatened, increase by 3
levels."19 Hooker and Reed contend that they should have been
sentenced under � 2A2.4(b)(1), instead of � 2A2.2, because they
used the firearms solely to threaten Craig.
The commentary to � 2A2.2 provides that "`aggravated assault'
means a felonious assault that involved (a) a dangerous weapon with
intent to do bodily harm (ie. not merely to frighten), or (b)
18 United States Sentencing Commission, Guidelines Manual,
�2A2.2 (Nov. 1992).
19 Id. at 40.
16

serious bodily injury, or (c) an intent to commit another felony."20
In addition, � 2A2.4(c)(1) cross-references � 2A2.2 by providing if
"the conduct constituted aggravated assault, apply � 2A2.2
(Aggravated Assault)."21
In our view, although there is some overlap between � 2A2.2
and � 2A2.4, the logical conclusion is that � 2A2.4 is meant to
apply to possession of weapons and verbal threats, while � 2A2.2 is
meant to apply to something more. In the present case, Hooker and
Reed's actions in pointing a cocked and loaded firearm at Craig's
head, while kicking him and deciding where to kill him, fits within
the definition of an "aggravated assault" under � 2A2.2.
In United States v. Johnson,22 the Third Circuit held without
discussion that the act of pointing a pistol at the victims' heads
while simultaneously threatening to kill them amounted to an
aggravated assault under � 2A2.2.
A district court's findings of fact for purposes of applying
the Sentencing Guidelines are reviewed under the clearly erroneous
standard of review.23 After reviewing the language of the
Sentencing Guidelines, the case law, and the record, we hold that
Hooker and Reed did commit a "felonious assault that involved a
20 Id. at 39, comment. (n.1).
21 Id. at 40.
22 931 F.2d 238 (3rd Cir.), cert. denied, 112 S.Ct. 242
(1991).
23 United States v. Mejia-Orosco, 867 F.2d 216, 221 (5th
Cir.), cert. denied, 109 S. Ct. 3257 (1989); United States v. De
La Rosa, 911 F.2d 985, 993 (5th Cir. 1990).
17

dangerous weapon with intent to do bodily harm";24 and the district
court properly sentenced them under � 2A2.2. For that reason, we
find no error committed by the district court on this issue.
Second, Hooker and Reed argue that even if they should have
been sentenced under � 2A2.2, they should not have been given a
three-level increase under � 3A1.2 of the Sentencing Guidelines.
Section 3A1.2 provides a 3 level increase if:
(a) the victim was a law enforcement or
corrections officer . . . and the offense of
conviction was motivated by such status; or
(b) during the course of the offense or
immediate flight therefrom , the defendant . .
. knowing or having reasonable cause to
believe that a person was a law enforcement or
corrections officer, assaulted such officer in
a manner creating a substantial risk of
serious bodily injury.25
Hooker and Reed contend that they did not know Craig was a law
enforcement officer, and therefore his status as an officer could
not have motivated them to assault him. However, their contention
is belied by the record, which is replete with statements of Hooker
and Reed voicing their belief that Craig was a law enforcement
officer. For example, Hooker told Reed, "[t]hey are the police.
Let's kill them." Hooker also told Reed, "[l]et me kill him. Let
me kill the . . . police." Those statements are sufficient to show
that Hooker and Reed knew Craig was a law enforcement officer, and
that his status as a law enforcement officer motivated them to
assault him. We therefore defer to the district court's finding
24 United States Sentencing Commission, Guidelines Manual, �
2A2.2 (Nov. 1992) n.1(a).
25 Id. at 239.
18

that Hooker and Reed were motivated to assault Craig by his status
as a law enforcement officer.
4. Did the District Court Err in Admitting Evidence of Hooker
and Reed's Prior Drug Related Activity?
Hooker and Reed contend that the district court violated
Federal Rules of Evidence 404(b)26 and 40327 by allowing into
evidence: the testimony by Pepper that he had purchased cocaine
from Reed in the past and that he had seen Reed deliver cocaine to
a cousin of Reed; a bag of large-denomination money wrappers; a
photograph of Reed, which was hanging on his wall, depicting him
with a gun in each hand seated before a table with a large sum of
money; and a receipt from the Gainseville, Florida Sheriff's office
for $40,850 in cash that had been seized from Hooker and Reed.
26 Rule 404(b) states:

[e]vidence of other crimes, wrongs, or acts
is not admissible to prove the character of a
person in order to show action in conformity
therewith. It may, however, be admissible
for other purposes, such as proof of motive,
opportunity, intent, preparation, plan,
knowledge, identity, or absence of mistake or
accident . . . .
Federal Rule of Evidence 404(b).
27 Rule 403 states:
although relevant, evidence may be excluded
if its probative value is substantially
outweighed by the danger of unfair prejudice,
confusion of the issues, or misleading the
jury, or by considerations of undue delay,
waste of time, or needless presentation of
cumulative evidence.
Federal Rule of Evidence 403.
19

In United States v. Beechum,28 this court established a two-
part test for the admissibility of evidence of extrinsic acts under
Rule 404(b). To be admissible, this court held the evidence must
be relevant to an issue other than the defendant's character, and
the probative value of the evidence must not be substantially
outweighed by unfair prejudice.29 We review the district court's
ruling for an abuse of discretion.
Reed and Hooker contend that Pepper's testimony that he had
bought drugs from Reed in the summer of 1990 was inadmissible
extrinsic act evidence. We disagree. Evidence showing involvement
in prior drug related activity is admissible under Rule 404(b) as
evidence of knowing participation in a conspiracy.30 In the present
case, Pepper's testimony of the prior dealings was admissible to
show Reed's and Hooker's specific intent and knowing involvement in
the conspiracy to distribute drugs and to rebut their defense of
entrapment, especially since Reed and Hooker argued strenuously at
trial that they had been entrapped and even requested an entrapment
instruction. Even if we were to assume the admission of the
testimony was error, it was harmless and did not affect "a
substantial right of the party."31 Pepper's testimony that he had
purchased drugs from Reed in the summer of 1990, a time when Reed
28 582 F.2d 898, 911 (5th Cir. 1978)(en banc), cert. denied,
440 U.S. 920 (1979).
29 Id. at 911.
30 United States v. Wood, 924 F.2d 399, 401 (1st Cir.
1991).
31 Fed. R. Crim. P. 52(a).
20

was in prison on an unrelated charge, was helpful to the defense,
not prejudicial, in that it allowed the defense to impeach Pepper
and call into question his credibility regarding other testimony.32
Hooker and Reed also contend that the admission of the money
wrappers, the cash receipt, and the photograph was error because it
showed that they engaged in large scale drug operations when they
were only indicted and on trial for a small drug sale. Hooker and
Reed rely on United States v. Chagra33 by claiming that, unlike in
Chagra, there is no evidence in the present case that defendants
were engaged in a ". . . large scale continuing narcotics
enterprise so as to justify . . . the admission of large sums of
money,"34 and that Chagra allows the evidence of ill-gotten gains
to be admitted only if shown to occur "at or after the time of the
commission of the alleged offense."35
The government contends that the evidence was admissible and
also relies on Chagra. In Chagra, this court held that it was not
error for the district court to allow into evidence a purchase by
the defendant, who was charged with drug crimes, of two expensive
residential properties. In allowing the admission of the evidence,
this court held:
32 See United States v. Gonzales-Lira, 936 F.2d 184, 191
(5th Cir. 1991).
33 669 F.2d 241 (5th Cir.), cert. denied, 459 U.S. 846
(1982).
34 Id. at 256.
35 Id.
21

there was sufficient evidence that appellant
was engaged in a large-scale continuing
narcotics enterprise so as to justify . . .
the admission as relevant and probative
evidence of his receipt of large sums of
money. That the funds for these acquisitions
may have stemmed from entirely lawful
activities . . . goes to the weight of the
evidence rather than to its admissibility.36
In the present case, there is sufficient evidence that Hooker
and Reed were involved in a drug selling enterprise.37 In addition,
we do not interpret Chagra to mean that the evidence of ill-gotten
gains need be shown to have occurred at exactly the time of the
crime or after but, rather near enough to the time of the crime for
a jury to reasonably infer a relationship between the ill-gotten
gains and the criminal conduct. In the present case, the time
between the commission of the crimes and the discovery of the money
wrappers, cash receipt, and photograph is sufficiently close to
meet the Chagra requirement.38
36 Id. at 256.
37 The search of Reed's house revealed three sets of scales
that contained cocaine residue, cocaine residue on the kitchen
counter and the microwave, inositol and baking soda, which are
used to cook powder cocaine into "crack," holsters and ammunition
for the guns, a police scanner, a cellular telephone, sandwich
bags with the corners cut off, which contained cocaine residue,
$1,333 in cash, and an identification card with Reed's picture
but bearing the name of Luther Howard.
38 The evidence was also necessary to rebut Hooker and
Reed's defense of entrapment, and the claim that Reed only had
the guns temporarily and for self-defense.
And it also showed
Hooker and Reed's motive and intent (to protect their drug
operation and its large profits) in assaulting Craig. This
evidence was necessary to explain to the jury the reason why
Hooker and Reed decided to kill Craig since Hooker and Reed
claimed at trial that they would not have tried to kill Craig, if
they would have known that he was a police officer.
22

Hooker and Reed next contend that the district court erred in
failing to make detailed findings under Rule 403 as to how it
balanced the probative value of the evidence against its
prejudicial effect. This court has held that such detailed
findings are not required if "the factors upon which the probative
value/prejudice evaluation were made are readily apparent from the
record, and there is no substantial uncertainty about the
correctness of the ruling."39 In the present case, those
requirements are met.
In sum, the district court did not abuse its discretion by
admitting into evidence Pepper's testimony, the money wrappers, the
cash receipt, and the photograph in that they were relevant to
issues other than Hooker and Reed's character, and that the
probative value of the evidence was not outweighed by its unfair
prejudice.
VI. CONCLUSION
We find that 18 U.S.C. 壯 922(k) and 924 read in conjunction
required Reed to have had knowledge at the relevant time that the
serial number had been altered or removed, and consequently the
district court erred in not giving an instruction to that effect.
We therefore reverse Reed's guilty verdict on Count 6. For
purposes of Hooker and Reed's convictions under 18 U.S.C. 壯 111
and 1114, we hold that officer Craig was a federal agent. We also
hold that Hooker and Reed were properly sentenced for aggravated
39 See United States v. Robinson, 700 F.2d 205, 213 (5th
Cir. 1983).
23

assault under � 2A2.2 and properly given a 3 level increase under
� 3A1.2. And, we hold that the district court did not abuse its
discretion in allowing the admission of evidence of Hooker and
Reed's prior drug related activity. We therefore affirm the
verdict on all other counts for both Hooker and Reed.
For the foregoing reasons, we REVERSE in part and AFFIRM in
part.
c:br:opin:92-7566p.mm
24