United States v. Blankenship
970 F.2d 283 (1992)
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Rule of Law:
A person who supplies goods or services to a criminal enterprise for a fixed fee, even with knowledge of their intended illegal use, does not become a member of the conspiracy without evidence that they intended to join and promote the venture's overall success.
Facts:
- Nancy Nietupski operated an extended family-run methamphetamine manufacturing and distribution ring.
- Nietupski's nephew, William Zahm, sought a location to manufacture methamphetamine for the enterprise.
- Zahm approached Thomas Lawrence to rent his house trailer for one day for the purpose of manufacturing methamphetamine.
- Lawrence was told of the plan and agreed to the rental in exchange for $1,000, receiving a $100 down payment.
- Lawrence prepared the trailer for the manufacturing process by covering the floor with plastic.
- The manufacturing attempt was postponed due to a technical issue and never took place in Lawrence's trailer.
- A few days later, Lawrence demanded that the chemicals and equipment be removed from his trailer, and they were.
- This was the only transaction between Lawrence and the Nietupski organization.
Procedural Posture:
- Thomas Lawrence was charged along with seven others in a single-count indictment for conspiring to manufacture and distribute methamphetamine in the U.S. District Court.
- Following a jury trial, Lawrence was convicted.
- The district court sentenced Lawrence to 120 months' imprisonment.
- Lawrence appealed his conviction to the U.S. Court of Appeals for the Seventh Circuit.
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Issue:
Does a person who agrees to rent property for a single, specific, and ultimately uncompleted illegal act for a fixed price thereby join the larger criminal conspiracy of which that act was a part?
Opinions:
Majority - Easterbrook, Circuit Judge.
No. A supplier of goods or services to a criminal enterprise does not join a conspiracy unless their fortunes are tied to the success of the venture. The court found a significant difference between merely supplying a criminal syndicate and joining it. Citing United States v. Falcone, the court emphasized that selling a legitimate commodity, even with knowledge of its intended illegal use, does not automatically create a conspiracy. The key distinction is between knowledge of a crime and an intent to join it. The court applied Judge Learned Hand's 'stake in the venture' test, reasoning that a supplier only becomes a conspirator if their 'fortunes rise or fall with the venture's.' Lawrence's agreement was for a one-time, fixed fee of $1,000, which likely represented a premium for the risk of property damage and criminal liability, not a share in the drug operation's profits. Because there was no evidence Lawrence knew of or agreed to promote the full scope of the Nietupski organization, he could not be convicted of joining that overarching conspiracy.
Analysis:
This decision reinforces the high bar for proving a supplier's membership in a conspiracy, requiring more than mere knowledge and a single transaction. It champions a functional distinction between peripheral facilitation and active participation, guided by whether the supplier has a 'stake in the venture.' The court's analysis highlights a potential gap in federal criminal law, noting the absence of a lesser 'criminal facilitation' statute, which forces an all-or-nothing choice between a broad conspiracy charge and no charge at all. This ruling protects legitimate businesses from undue risk but may make it harder for prosecutors to charge peripheral actors who provide essential, one-off services to criminal organizations.
