United States v. Rick Coley

U.S. Court of Appeals for the Seventh Circuit
United States v. Rick Coley, 137 F.4th 874 (7th Cir. 2025)

United States v. Rick Coley

Opinion

                              In the

    United States Court of Appeals
                 for the Seventh Circuit
                    ____________________
Nos. 23-2494 & 23-2519
UNITED STATES OF AMERICA,
                                                  Plaintiff-Appellee,
                                v.

RICK P. COLEY & DAVID K. DUGGAR,
                                            Defendants-Appellants.
                    ____________________

        Appeals from the United States District Court for the
        Southern District of Indiana, Indianapolis Division.
       Nos. 1:21-cr-00193-007, -011 — James P. Hanlon, Judge.
                    ____________________

     ARGUED OCTOBER 31, 2024 — DECIDED MAY 15, 2025
                ____________________

   Before SYKES, Chief Judge, and RIPPLE and LEE, Circuit
Judges.
    SYKES, Chief Judge. A jury convicted Rick Coley and David
Duggar on drug and firearm charges stemming from their
participation in an Indianapolis drug-trafficking conspiracy
led by Jason Betts. They challenge their conspiracy
convictions, arguing that they had only buyer-seller
relationships with Betts, not conspiratorial agreements. Coley
also challenges the sufficiency of the evidence on his firearm
2                                       Nos. 23-2494 & 23-2519

conviction, and both defendants challenge the denial of their
joint motion to sever the drug-trafficking counts from the
firearms counts.
    We reject these arguments and affirm. The evidence at trial
established that Coley and Duggar repeatedly purchased
distribution quantities of drugs from Betts and his operatives.
As we recently held in United States v. Page, 
123 F.4th 851
 (7th
Cir. 2024) (en banc), that is enough to support a drug
conspiracy conviction. The evidence also supports Coley’s
firearm conviction based on a theory of constructive
possession: the gun in question was found in his bedroom at
the time of his arrest, alongside his personal items and drug-
dealing implements. Finally, the drug-trafficking and firearm
counts were properly joined, and the judge did not abuse his
discretion in denying the severance motion.
                        I. Background
    From late 2018 until he was arrested in July 2021, Jason
Betts ran a large methamphetamine and fentanyl distribution
ring in Indianapolis. As relevant here, Betts regularly
supplied Coley and Duggar, who resold the drugs to their
own customers. Because Coley and Duggar acted
independently of each other and their relationships with Betts
differed in some respects, we separately recount the evidence
adduced against them at trial.
A. Coley
   At the end of 2018, Betts began supplying distribution
quantities of methamphetamine to Christina Pennington and
her boyfriend Shaune Smith after meeting them through a
family member of his. As business picked up for Pennington
and Smith, so too did their drug orders from Betts. By July
Nos. 23-2494 & 23-2519                                        3

2019, they were receiving about five pounds of meth every
week or so, and by September, Betts was also supplying them
with fentanyl. Pennington and Smith in turn distributed the
drugs to others, including Coley, for resale to customers.
   Pennington recruited Coley into the distribution network
about a year after she and Smith began purchasing drugs
from Betts. Starting in about December 2019, Coley purchased
meth and fentanyl from Pennington and Smith at least every
couple of days, mostly on credit. Depending on customer
demand, Coley procured about an ounce or two of meth and
anywhere from a couple grams to an ounce of fentanyl during
any given transaction. Throughout this period Coley shared
customers with Pennington and Smith, sometimes
accompanying them to drug sales—and Smith described
Coley as a “business partner” in a text message to him.
    This arrangement continued for about three months, until
early March 2020 when Pennington and Smith were arrested
for drug possession. At the time of their arrest, the couple
owed Betts about $22,000 for fronted drugs. After learning
that Coley owed money to Smith, Betts called him via
Facebook Messenger to discuss payment of the debt. Coley
ultimately agreed to pay Betts the value of the debt he owed
to Smith in exchange for drugs from Betts.
    Across three transactions over the following week and a
half, Betts fronted Coley about one and a half pounds of meth
and three ounces of fentanyl. On March 12, 2020, shortly after
the third transaction, Indianapolis police arrested Coley in his
motel room, seizing the meth that he had acquired from Betts
as well as two handguns and $2,530 in cash.
4                                      Nos. 23-2494 & 23-2519

    Coley was released a few months later and almost
immediately informed Betts that he was ready to sell drugs
again. Despite concerns that Coley might have become a
government informant, Betts agreed to resume their drug-
distribution relationship.
    After an initial transaction involving small amounts of
fentanyl and meth, Betts supplied Coley with a few hundred
grams of fentanyl every two weeks and continued to do so
from the late fall of 2020 until July 2021. Betts advised Coley
on how to distribute the fentanyl, urging him not to sell on
credit to particular customers and suggesting that Coley have
someone else answer customer phone calls when he was ill or
unable to do so. And because Betts was concerned about the
risks of dealing drugs from hotels, he also helped Coley find
a place to live, though Coley relocated to another residence
shortly after moving in.
    Meanwhile, in January 2021 Pennington began
cooperating with federal law enforcement, identifying Betts
as her drug source and describing his arrangement with
Coley. Based on her information, federal agents obtained
several court orders authorizing wiretaps of Betts and others
in his orbit.
    On July 14, 2021, law-enforcement officers arrested Coley
at the three-bedroom house that he then shared with several
roommates. Coley wasn’t wearing a shirt or shoes when he
was arrested, so he pointed the officers to his bedroom and
asked them to bring him a shirt and sandals from his bedroom
closet. While retrieving those items, the officers discovered a
digital scale and blender in a nightstand next to the bed, both
of which contained drug residue. They also found a loaded
shotgun behind Coley’s bedroom door.
Nos. 23-2494 & 23-2519                                      5

B. Duggar
    Betts met Duggar through a friend who was part of his
drug-trafficking ring. From at least October 2020 until May 6,
2021, Duggar bought meth from Betts every day or two,
typically between four and eight ounces but sometimes up to
a pound each time. Unlike Coley, Duggar paid for the meth
in cash because Betts did not trust Duggar enough to sell to
him on credit. Duggar then sold the meth to his own
customers. Whenever Duggar collected enough money from
his customers, he sought more meth from Betts. Likewise,
Betts informed Duggar whenever he had more meth
available, explaining that as long as Duggar kept paying, he
would continue to supply him with drugs.
    Duggar and Betts did not have an exclusive arrangement,
however. Duggar had another supplier whom he called his
“main guy.” Neither Betts nor Duggar knew the identity of
each other’s customers, and Betts never instructed Duggar on
how to distribute the meth. They did, however, discuss
certain matters relevant to their drug-dealing relationship.
For example, Betts reprimanded Duggar when he was late or
missed a meeting, and on one occasion warned him about the
presence of the police, postponing a planned transaction until
later in the day. Duggar also sought Betts’s assistance in
dealing with two customers who owed him money; the latter
offered to help but nothing ever came of it.
   Duggar was arrested in his hotel room on July 14—the
same day as Coley’s arrest—as part of the federal
investigation of Betts’s drug-trafficking operation. Officers
found meth, digital scales, plastic baggies, and two rifles in
Duggar’s hotel room.
6                                              Nos. 23-2494 & 23-2519

C. Trial and Conviction
    The government eventually indicted Betts and 19 others—
including Coley and Duggar—based on evidence gathered
during the investigation of Betts’s drug-trafficking network.
Coley and Duggar were charged with conspiracy to distribute
controlled substances, in violation of 
21 U.S.C. § 846
;
possession of meth (Duggar) and fentanyl (Coley) with intent
to distribute, in violation of 
21 U.S.C. § 841
(a)(1); and
possession of a firearm by a felon, in violation of 
18 U.S.C. § 922
(g)(1).1 Betts and the other defendants pleaded guilty.
    The case against Coley and Duggar proceeded to trial. The
defendants jointly moved to sever the drug-trafficking counts
from the firearms counts, arguing that the charges were
improperly joined under Rule 8(a) of the Federal Rules of
Criminal Procedure, and alternatively, that severance was
warranted under Rule 14. More specifically, they maintained
that the drug and firearm charges lacked a common factual
basis and that the evidence relevant to the firearm counts—
specifically their criminal histories—would not be admissible
in a trial featuring only the drug-trafficking counts. The
district judge denied the motion, noting that the firearms in
question were found in each defendant’s room along with



1 The government also charged Coley with receipt of a firearm by a person

under indictment, in violation of 
18 U.S.C. § 922
(n). His conviction on this
count was later vacated and merged with the § 922(g)(1) conviction
because it was based on the same conduct. See United States v. Parker, 
508 F.3d 434, 440
 (7th Cir. 2007) (“Although the government is free to pursue
multiple theories of violation at trial, only one conviction may result under
§ 922(g) for a single incident of possession, even though the defendant
may belong to more than one disqualified class.” (citation omi ed)).
Nos. 23-2494 & 23-2519                                             7

evidence of their ongoing drug trafficking, and that the
evidence on the drug and firearm charges overlapped.
    At trial the government introduced numerous
incriminating phone calls, text messages, and testimony from
key coconspirators—including Betts himself. At the close of
the government’s case, Coley and Duggar moved for
judgment of acquittal on all counts. The judge reserved his
ruling and later agreed to give the jury a buyer-seller
instruction.2 The jury found Coley and Duggar guilty on all
counts. The judge then denied their motions for acquittal and
sentenced Coley and Duggar to 360 and 276 months in prison,
respectively.
                            II. Discussion
   Coley and Duggar argue that the government failed to
present sufficient evidence to convict them of conspiracy.
Coley also challenges his firearm conviction on the same



2 The instruction stated:

        [A] conspiracy requires more than just a buyer-seller
        relationship between a defendant and another person. In
        addition, a buyer and seller of methamphetamine or
        fentanyl do not enter into a conspiracy to possess
        methamphetamine or fentanyl with intent to distribute
        methamphetamine or fentanyl simply because the buyer
        resells the methamphetamine or fentanyl to others, even
        if the seller knows that the buyer intends to resell the
        methamphetamine or fentanyl. The [g]overnment must
        prove that the buyer and seller had the joint criminal
        objective of further distributing methamphetamine or
        fentanyl to others. A routine buyer-seller relationship,
        without more, is not sufficient to prove conspiracy.
8                                      Nos. 23-2494 & 23-2519

ground. And both defendants challenge the denial of the
severance motion.
A. Sufficiency of the Evidence
    A challenge to the sufficiency of the evidence to sustain a
conviction faces a demanding standard of review: we give
great deference to the jury’s verdict, viewing the trial
evidence in the light most favorable to the verdict and
drawing all reasonable inferences in the government’s favor.
United States v. Brown, 
973 F.3d 667
, 682 (7th Cir. 2020). To
prevail, the defendant must show that no rational jury could
have found him guilty beyond a reasonable doubt. See United
States v. Garcia, 
919 F.3d 489, 496
 (7th Cir. 2019). We have
characterized this burden as “heavy, indeed, nearly
insurmountable.” United States v. Dessart, 
823 F.3d 395, 403
(7th Cir. 2016) (internal quotation marks omitted).
    1. Conspiracy convictions
    “To convict a defendant of conspiracy, the government
must prove[:] (1) two or more people agreed to commit an
unlawful act[;] and (2) the defendant knowingly and
intentionally joined in the agreement.” United States v. Wright,
85 F.4th 851, 861
 (7th Cir. 2023) (internal quotation marks
omitted). For drug conspiracies, this requires sufficient
evidence that “the defendant knowingly agreed, perhaps
implicitly, with someone else to distribute drugs.” United
States v. Hidalgo-Sanchez, 
29 F.4th 915
, 924–25 (7th Cir. 2022)
(internal quotation marks omitted). “Evidence showing only
that two people are in a buyer-seller relationship is
insufficient to prove a drug-distribution conspiracy.” 
Id. at 925
.
Nos. 23-2494 & 23-2519                                          9

    Coley and Duggar argue that the government proved only
that they had buyer-seller relationships with Betts, not
conspiratorial agreements. On this record, their argument is
foreclosed by our recent en banc decision in United States v.
Page, 
123 F.4th 851
 (7th Cir. 2024), issued shortly after this
appeal was argued. Our circuit precedent had previously
held that evidence of repeated, distribution-quantity drug
transactions was insufficient, without more, to sustain a drug-
conspiracy conviction, but Page overruled that line of cases.
Id.
 at 861–63.
    We explained in Page that our circuit’s conspiracy and
buyer-seller jurisprudence had long ago deviated from the
Supreme Court’s decision in Direct Sales Co. v. United States,
319 U.S. 703
 (1943), the foundational case on the buyer-seller
doctrine in drug-conspiracy law. 
Id.
 at 859–61. In Direct Sales,
the Supreme Court affirmed a conspiracy conviction against
a registered drug manufacturer based solely on its repeated
sales of “illegally vast quantities of morphine sulphate” to a
doctor who subsequently distributed the drugs to others. 319
U.S. at 704–07, 714–15. As we noted in Page, the illegality of
the drug transactions in Direct Sales “proved critical to
sustaining [the] conspiracy conviction” because “[t]here is an
inherent and necessary trust between parties to an illegal
transaction … that is not shared by buyers and sellers of
innocuous items.” Page, 123 F.4th at 859–60.
    In a series of cases starting with United States v. Colon, 
549 F.3d 565
 (7th Cir. 2008), our circuit had missed the distinction
drawn in Direct Sales between proof of repeated, distribution-
quantity sales of illicit drugs, which alone is sufficient to
sustain a conspiracy conviction, and proof of “repeated,
distribution-quantity sales of innocuous goods between a
10                                      Nos. 23-2494 & 23-2519

buyer and seller,” which is not. Page, 
123 F.4th at 861
(emphasis added).
    We went on in Page to reset our circuit’s drug-conspiracy
law on the foundation established in Direct Sales, explaining
that when a seller of illegal drugs repeatedly sells distribution
quantities to a buyer with the knowledge that the buyer
intends to illegally distribute the drugs to others, the buyer
and seller “develop … a codependent business relationship
wherein they have a shared stake in each other’s success.” 
Id. at 860
. Based on the “mutually known benefits that flow from
[their] transactions,” we explained that “evidence of repeated,
distribution-quantity transactions … shows that the buyer
and seller knowingly and intentionally entered into an
implicit agreement to distribute drugs.” 
Id.
 On this reasoning,
and consistent with the Supreme Court’s decision in Direct
Sales, we held that evidence of “repeated, distribution-
quantity drug transactions alone can sustain a conspiracy
conviction.” 
Id.
 at 856–57.
    In light of Page, the government’s evidence against Coley
and Duggar was easily sufficient to sustain the jury’s guilty
verdicts on the conspiracy counts. Betts testified that he
repeatedly sold Coley and Duggar distribution quantities of
drugs: for Coley, hundreds of grams of fentanyl every two
weeks from fall 2020 until July 14, 2021; and for Duggar, at
least four ounces of meth at least once each week from
October 2020 until May 6, 2021. That’s enough for a rational
jury to conclude that each defendant entered into an
agreement with Betts, at least implicitly, to distribute drugs.
   Coley and Duggar argue that Betts’s testimony is biased,
compromised, or otherwise unreliable. “But evaluating the
credibility of [a] witness[] is the jury’s job,” United States v.
Nos. 23-2494 & 23-2519                                        11

Cruse, 
805 F.3d 795, 812
 (7th Cir. 2015), and “[a] finder of fact
is entitled to believe the testimony of even the most dishonest
of witnesses,” United States v. Conley, 
875 F.3d 391, 400
 (7th
Cir. 2017). We will not find a witness incredible as a matter of
law except in “extreme situations”—for example, where “it
would have been physically impossible for the witness to
observe what he described, or it was impossible under the
laws of nature for those events to have occurred at all.” 
Id.
(internal quotation marks omitted). Betts’s testimony was not
incredible under this standard.
   2. Coley’s firearm conviction
    The jury found Coley guilty of violating § 922(g)(1) based
on his possession of the loaded shotgun found behind his
bedroom door. A § 922(g)(1) conviction requires proof of four
elements: (1) the defendant was convicted of a felony; (2) the
defendant knowingly possessed a firearm; (3) the defendant
knew he was a felon; and (4) the gun possessed by the
defendant had been in or affected interstate commerce. United
States v. Price, 
28 F.4th 739
, 752–53 (7th Cir. 2022). Coley
challenges only the second element.
    The government relied on the concept of constructive
possession, a legal theory “whereby a person is deemed to
possess contraband even when he does not actually have
immediate, physical control of the object.” United States v.
Perryman, 
20 F.4th 1127, 1133
 (7th Cir. 2021) (internal
quotation marks omitted). Proximity together with evidence
showing a connection between the defendant and the gun is
sufficient to establish constructive possession. Price, 
28 F.4th at 753
. We have repeatedly held that such a connection exists
where a gun is “found in areas over which the defendant
exercised control, such as a bedroom.” United States v. Thomas,
12                                         Nos. 23-2494 & 23-2519

321 F.3d 627, 636
 (7th Cir. 2003); see, e.g., United States v. Alanis,
265 F.3d 576, 582, 592
 (7th Cir. 2001) (bedside nightstand).
    Coley admits that he was in his bedroom on the day of his
arrest, when the shotgun was found behind the bedroom
door. He protests that nothing else links him to the gun.
Viewed in the light most favorable to the verdict, however,
the evidence amply supports constructive possession. Coley
directed the arresting officers to his bedroom to retrieve
clothing and sandals from his closet, demonstrating his
authority and control over the bedroom and its contents. His
clothing is sufficient physical evidence linking him with the
bedroom and other items found there, including the shotgun.
See United States v. Katz, 
582 F.3d 749, 753
 (7th Cir. 2009); cf.
United States v. Irby, 
558 F.3d 651, 654
 (7th Cir. 2009) (“The
presence of [the defendant’s] state identification card, social
security card, and mail addressed to him in the master
bedroom demonstrated that he was living in the room where
the marijuana and crack were found.”).
    Coley points out that his roommates had access to his
bedroom and could have placed the gun behind the door. But
no evidence supports that theory; regardless, “[c]onstructive
possession may be sole or joint.” United States v. Hampton, 
585 F.3d 1033, 1041
 (7th Cir. 2009). Coley also criticizes the
government for failing to conduct fingerprint or DNA testing
of the shotgun. But constructive possession can be proved by
direct or circumstantial evidence, Price, 
28 F.4th at 753
, so the
absence of fingerprint or DNA evidence is of little
consequence. Coley has not carried his burden to show that
no rational jury could have found that he possessed the
shotgun.
Nos. 23-2494 & 23-2519                                         13

B. Misjoinder/Severance
    A severance claim involves two distinct issues. United
States v. Berg, 
714 F.3d 490, 494
 (7th Cir. 2013). “The first is
joinder—whether the two sets of charges had enough in
common to be tried in the same case. The second is
severance—whether, despite being properly joined, the two
sets of charges nevertheless should have been tried separately
to avoid undue prejudice.” 
Id.
 “Whether joinder was proper
is a question of law subject to de novo review.” United States
v. Peterson, 
823 F.3d 1113, 1124
 (7th Cir. 2016). If charges were
properly joined, then we review the denial of a request for
severance deferentially, for abuse of discretion. United States
v. Jackson, 
787 F.3d 1153, 1158
 (7th Cir. 2015).
   Under Rule 8(a) of the Federal Rules of Criminal
Procedure, joinder of offenses is permissible if they “are of the
same or similar character, or are based on the same act or
transaction, or are connected with or constitute parts of a
common scheme or plan.” In determining whether joinder
was proper, “we look solely to the face of the indictment,”
comparing “the offenses charged for categorical, not
evidentiary, similarities.” Berg, 
714 F.3d at 495
 (internal
quotation marks omitted).
    As Coley and Duggar acknowledge, we have long
presumed that drug-trafficking and firearm counts are
properly joined because “[p]ossession of firearms and drug
trafficking are closely related.” United States v. Pigee, 
197 F.3d 879, 891
 (7th Cir. 1999). “This presumption arises from the
natural inferences that may be drawn from the
contemporaneous possession of guns and drugs or drug
paraphernalia: the firearm is an indication of drug activity,
and participation in drug trafficking supplies a motive for
14                                     Nos. 23-2494 & 23-2519

having the gun.” United States v. Blanchard, 
542 F.3d 1133, 1141
(7th Cir. 2008) (internal quotation marks omitted). The
presumption can be overcome by “a significant temporal
disconnect between the alleged offenses.” Id.; see, e.g., United
States v. Hubbard, 
61 F.3d 1261
, 1270–71 (7th Cir. 1995)
(concluding that firearms and narcotics charges were
misjoined where the firearms were discovered more than 17
months after the defendant’s final drug transaction).
    There is no temporal disconnect here. But even setting
aside the force of the presumption, the drug and firearm
charges in this case are plainly part of a common scheme,
plan, or series of transactions. The firearms in question were
found in the defendants’ rooms at the time of their arrests,
together with drugs and other implements of their drug-
trafficking activity, and during the ongoing drug conspiracy.
    So the drug and firearm counts were properly joined. And
the district judge did not abuse his discretion in declining to
sever them. Under Rule 14, which governs relief from
prejudicial joinder, Coley and Duggar bear a heavy burden to
demonstrate that the judge’s denial of severance prejudiced
them. See United States v. Ervin, 
540 F.3d 623, 629
 (7th Cir.
2008). “[I]t is not enough that separate trials may have
provided [them] with a better opportunity for acquittal.”
United States v. Dixon, 
184 F.3d 643, 645
 (7th Cir. 1999)
(internal quotation marks omitted). They must instead
“establish that the denial of severance actually prejudiced
[them] by preventing the jury from arriving at a reliable
judgment as to guilt or innocence.” Ervin, 
540 F.3d at 629
.
    Coley and Duggar have not carried this burden. There is
no prejudice if the evidence on the counts the defendant asks
to be severed would be admissible in a trial on the remaining
Nos. 23-2494 & 23-2519                                         15

counts. See United States v. Rollins, 
301 F.3d 511, 519
 (7th Cir.
2002). As we’ve noted, the defendants’ participation in drug
trafficking is proof of motive for having a gun, see Blanchard,
542 F.3d at 1141
, which is itself relevant to showing
constructive possession when coupled with proximity to the
gun, see Price, 
28 F.4th at 753
. That chain of reasoning certainly
applies here because Coley and Duggar possessed the
firearms in question during the drug-trafficking conspiracy,
and law-enforcement officers found the guns in their rooms
alongside drugs and indicia of drug dealing.
    Coley and Duggar nonetheless claim prejudice based on
so-called “spillover,” arguing that the firearm counts
highlighted their criminal backgrounds and may have led
jurors to infer that they had criminal dispositions, potentially
affecting the jury’s consideration of the evidence on the drug-
trafficking counts. Speculation about a “spillover” effect
doesn’t suffice to show actual prejudice. See Ervin, 
540 F.3d at 629
. And any marginal prejudice was cured when the judge
instructed the jury to consider all counts separately. See United
States v. Maggard, 
865 F.3d 960, 972
 (7th Cir. 2017) (“[A]s the
Supreme Court has held, less drastic measures than
severance, ‘such as limiting instructions, often will suffice to
cure any risk of prejudice.’” (quoting Zafiro v. United States,
506 U.S. 534, 539
 (1993))).
    In any event, there is no prejudice where “the evidence
against [the defendants] was compelling on all counts.” Berg,
714 F.3d at 496
. That is certainly the case here. Accordingly,
the judge was well within his discretion to deny the severance
motion.
                                                       AFFIRMED


Reference

Cited By
2 cases
Status
Published