United States of America v. Bogdan Gajo

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

-- 1 of 15 --

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

-- 2 of 15 --

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.

-- 3 of 15 --

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

-- 4 of 15 --

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

-- 5 of 15 --

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

-- 6 of 15 --

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

-- 7 of 15 --

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

-- 8 of 15 --

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

-- 9 of 15 --

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

-- 10 of 15 --

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

-- 11 of 15 --

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.

-- 12 of 15 --

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

-- 13 of 15 --

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.

-- 14 of 15 --

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.

-- 15 of 15 --