The following excerpt is from United States v. Bagby, 451 F.2d 920 (9th Cir. 1971):
The 174 inference does not remove the crucial elements of illegal importation and the defendant's knowledge thereof from the consideration of the jury once possession has been established. Both elements remain essential to a conviction under 174, and both must be proved by the prosecution beyond a reasonable doubt. It was error for the trial court to instruct the jury concerning the legislative fact-finding on which the 174 presumption rests. The trial court should have made it clear that the section does not require the jury to find knowledge of the illegal importation of heroin, merely because the jury might find that the fact of possession has been established. United States v. Crespo, 2 Cir., 1970, 422 F.2d 718. Here, to the contrary, the trial judge's instructions could have been interpreted by the jury as directing a finding for the prosecution on the essential element of illegal importation.
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