## Facts

- John Marsh and John Crane, with a codefendant, operated a scheme promoting electric machines as capable of curing many ailments despite lacking medical licenses.
- They obtained payments from customers—often labeled as “donations” to a nonprofit or as “rent” for a “loan” of the machines—typically ranging from $175 to $2,000.
- The prosecution presented extensive, largely uncontradicted evidence (including undercover recordings) that defendants made broad curative claims, that the claims were false, and that money was obtained based on those representations.
- Defendants contended they acted in good faith and sought to introduce scientific and medical reports as the basis for their belief that the machines worked.
- The trial court allowed defendants to testify generally that they relied on reports, but excluded the contents of the reports as hearsay.
- Defendants also introduced testimony from multiple users who claimed they had been cured by the machines.
- Defendants were convicted of attempted grand theft, conspiracy to commit grand theft (both submitted as theft by false pretenses), and conspiracy to practice medicine without a license; Marsh and Crane appealed.

## Issues

1. Whether, in a theft-by-false-pretenses prosecution requiring specific intent to defraud, the trial court erred by excluding the contents of medical and scientific reports offered to show defendants’ state of mind and good-faith belief.
2. Whether exclusion of that intent evidence required reversal of the attempted grand theft and grand-theft conspiracy convictions.
3. Whether the same evidentiary error required reversal of the conviction for conspiracy to practice medicine without a license.

## Decision

- The court held the trial court erred by excluding the contents of the reports insofar as they were offered to show the information defendants relied on and thus their state of mind, rather than to prove the truth of the reports.
- The error was prejudicial on the counts requiring proof of specific intent to defraud, requiring reversal of the attempted grand theft and conspiracy to commit grand theft convictions.
- The conviction for conspiracy to violate Business and Professions Code § 2141 (practice of medicine without a license) was affirmed.

## Legal Principles

- Theft by false pretenses under Penal Code § 484 requires proof of specific intent to defraud; false statements alone are insufficient if made in good faith.
- Out-of-court writings may be admissible for a nonhearsay purpose when offered to show their effect on the listener/actor—i.e., the information on which a defendant acted and the defendant’s resulting state of mind.
- When evidence is offered to prove state of mind rather than truth, exclusion on hearsay grounds may improperly restrict a defense to charges turning on specific fraudulent intent.
- A defendant’s belief in the efficacy of a treatment does not negate liability for practicing medicine without a license when the charged conduct constitutes diagnosis or treatment without the required licensure.

## Conclusion

The court reversed the fraud-based theft convictions because the jury was not allowed to consider documentary evidence bearing on defendants’ good-faith belief and intent, but it affirmed the unlicensed-practice conspiracy conviction because that offense did not depend on whether defendants believed their machines worked.


People v. Marsh, 58 Cal. 2d 732 (Cal. 1962)