United States v. Khilchenko, Viktor ( 2003 )

In the
United States Court of Appeals
For the Seventh Circuit
____________
Nos. 01-4202 & 01-4203
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
VIKTOR KHILCHENKO and
NAZAR BABIYCHUK,
Defendants-Appellants.
____________
Appeals from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 00-CR-179—Joan B. Gottschall, Judge.
____________
ARGUED FEBRUARY 13, 2003—DECIDED APRIL 7, 2003
____________
Before COFFEY, MANION, and ROVNER, Circuit Judges.
COFFEY, Circuit Judge. Viktor Khilchenko (“Khilchenko”)
and Nazar Babiychuk (“Babiychuk”) challenge their con-
victions after a jury found them guilty of violating 18
U.S.C. § 894 (“Collection of extensions of credit by extor-
tionate means”). We affirm.
I. FACTUAL BACKGROUND
Shortly after 6 p.m. on the evening of March 8, 2000,
Andrey Grin (“Grin”) drove his Honda Passport to Skokie,
Illinois to pick up his fiancée, Irina Gaponenko, after work.
2 Nos. 01-4202 & 01-4203
Grin pulled over to the curb, and Gaponenko entered the
car. Just after she did so, a vehicle containing defendants
Khilchenko and Babiychuk pulled in front of Grin’s car and
blocked it in. Khilchenko and Babiychuk exited their
vehicle, approached Grin’s car and opened the driver’s door.
The two then showed Grin a picture of a young woman,
whom Grin recognized as Svetlana Fastoskaya (“Svetlana”),
and claimed that Grin owed her $80,000. They threatened
Grin, saying that if he did not pay up, they would harm him
or his family.
Grin protested, saying that he did not owe any money
to Svetlana, whom he knew as a former girlfriend and as
a business partner in his video production business.
Khilchenko and Babiychuk instructed Grin to contact
Svetlana and determine what amount, if any, he owed
Svetlana. They warned him not to go to the police and then
left.
The next evening, March 9, Grin met with Svetlana at a
pancake restaurant in Skokie. At this meeting, Svetlana
told Grin that she wanted him to pay back the money she
had invested in his video production business. She showed
Grin a list of expenses and indicated that Khilchenko
and Babiychuk had been hired to get her money back at a
fifty percent commission. She also offered to forgive the
debt if Grin married her. As Grin and Svetlana were
talking, Khilchenko and Babiychuk entered the restaurant
and confronted Grin. Khilchenko asked Svetlana how
much Grin owed her; she responded by saying “$80,000.”
Khilchenko then threatened Grin that he would be killed if
he failed to come up with at least $20,000 by 5 p.m. the
next day.
At approximately 10 a.m. the next morning, March 10,
Grin called the FBI in an effort to secure their assistance.
Grin wore an FBI-provided wire to his last meeting with the
defendants. After recording further threats made by
Nos. 01-4202 & 01-4203 3
Khilchenko and Babiychuk, as well as tracking a transfer
of money from Grin to the two defendants, the FBI arrested
Khilchenko and Babiychuk.
On March 11, 2000, defendants were charged by Com-
plaint with violations of 18 U.S.C. § 894 (“Collection of
extensions of credit by extortionate means”) under 18
U.S.C. § 2 (“Principals”). On April 6, 2000, defendants were
charged by Indictment. Babiychuk filed a pretrial Motion to
Dismiss Indictment, asserting that no interstate commerce
issues existed in the case, and hence there was no federal
jurisdiction. The district court denied the motion. At the
close of evidence at the defendants’ trial by jury, both de-
fendants jointly renewed the pretrial Motion to Dismiss
Indictment as a Motion for Judgment of Acquittal. The
district court denied the motion, referencing its earlier
ruling. The jury found the defendants guilty. Both of the
defendants were sentenced to 35 months’ imprisonment on
November 29, 2001. Upon their release from confinement,
both convicts are to be surrendered by the authorities to the
immigration authorities for immediate deportation.
The district court had jurisdiction pursuant to 18 U.S.C.
§ 3231. This Court has jurisdiction over this appeal pur-
suant to 28 U.S.C. §§ 1291 and 3742(a). Khilchenko and
Babiychuk raise three issues on appeal: (1) the evidence
used against them was insufficient to support their convic-
tion; (2) the evidence produced by the government at trial
constituted a variance from or constructive amendment of
the indictment; and (3) the law that they are charged with
breaking violates the Commerce Clause.
II. ANALYSIS
A. Sufficiency of the Evidence
Khilchenko and Babiychuk argue that the evidence pre-
sented by the government at trial was insufficient to sup-
4 Nos. 01-4202 & 01-4203
port the jury’s guilty verdict. This Court will reverse the
jury’s verdict only when there was “no basis for a rational
factfinder to find all of the essential elements of a crime
beyond a reasonable doubt.” United States v. McCaffrey,
181 F.3d 854, 856 (7th Cir. 1999). We will not substitute
our own credibility assessment for that of the factfinder,
nor will we consider conflicting evidence or alternate
theories of the case. Id.In United States v. Touloumis, 771 F.2d 235 (7th Cir.
1985), this Court stated that to convict a defendant under
§ 894, the trier of fact must find that: (1) a collection or
attempted collection of an “extension of credit” was made,
(2) extortionate means were used, and (3) the defendant
knowingly participated in these actions. Id. at 238. To
“extend credit” is defined at 18 U.S.C. § 891(1) as “to make
or renew any loan, or to enter into any agreement, tacit or
express, whereby the repayment or satisfaction of any debt
or claim, whether acknowledged or disputed, valid or in-
valid, and however arising, may or will be deferred.”
Here, defendants challenge whether they knowingly par-
ticipated in the collection or attempted collection of an
extension of credit. Khilchenko and Babiychuk argue that
no “debt” existed between Grin and Svetlana, and that as a
result they could not have been attempting to collect an
extension of credit under the first part of the Touloumis
analysis.
The plain language of the statutory definition indicates
that “extension of credit” applies to “debts or claims.” 18
U.S.C. § 891(1). When applying 18 U.S.C. § 894, this Court
does not inquire as to how the debt or claim arose. See
United States v. Annerino, 495 F.2d 1159, 1166 & n.8 (7th
Cir. 1974) (noting that § 894 forbids the extortionate col-
lection of an extension of credit “regardless of whether the
loan arose from a traditional type of loan or resulted from
the assumption of responsibility as a result of force or
threats”).
Nos. 01-4202 & 01-4203 5
Although Grin testified that he did not believe that he
owed Svetlana any money and that he and Svetlana “never
had an agreement that I had to return the money,” Grin
also testified that Khilchenko and Babiychuk told him he
owed Svetlana $80,000 and that they would harm him if he
did not pay it back. Based on such testimony, the jury could
reasonably have found that a “debt or claim” existed be-
tween Svetlana and Grin. While there is no doubt that the
existence of the debt or claim was disputed, such “disputed”
debts are expressly included in the § 891(1) definition of
“extension of credit.” Therefore, because a rational jury
could have decided as the jury in this case did, we refuse to
disturb the trial court’s ruling on this issue.
B. Variance from or Amendment to the Indictment
Khilchenko and Babiychuk argue that the evidence pre-
sented by the government at trial constituted a variance
from or constructive amendment of the indictment. Such
amendments are prohibited by the Fifth Amendment,
which states that “No person shall be held to answer for a
capital, or otherwise infamous crime, unless on a present-
ment or indictment of a Grand Jury.” Whereas Khilchenko
and Babiychuk did not raise an objection to an alleged
constructive amendment below, we review for plain error.
United States v. Baker, 227 F.3d 955, 963 (7th Cir. 2000).
To effect a constructive amendment, the evidence at trial
must establish offenses different from or in addition to
those charged by the grand jury. Id. at 960. To merit
reversal, the constructive amendment must be so serious
that a defendant probably would have been acquitted
without it. Id. at 963.
Khilchenko and Babiychuk’s constructive amendment
argument is essentially a repeat of their argument that the
evidence against them was insufficient; that is, that the
government did not prove the existence of a “debt” between
6 Nos. 01-4202 & 01-4203
Grin and Svetlana. For the reasons discussed supra, their
argument fails. The government presented sufficient proof
of a “debt or claim” under § 891. We disagree with the
defendants’ contention, for the evidence at trial surely did
not establish offenses different from or in addition to those
charged by the grand jury, as Baker requires. We conclude
that there was no constructive variance between the in-
dictment and the evidence adduced at trial.
Khilchenko and Babiychuk also argue that “the facts
surrounding defendants’ case are inconsistent with the
facts associated with a (typical) violation of (§ 894).” This
argument, too, is unavailing. It does not matter whether
defendants’ conduct matches typical violations of the
statute; what matters is whether their conduct violates the
plain language of the statute. Because the evidence at trial
was not at variance with the Indictment, the district court’s
ruling is affirmed.
C. The Commerce Clause
Khilchenko and Babiychuk argue that the district court
erred in dismissing their post-trial motion for judgment of
acquittal. We review motions for judgment of acquittal
under the same standard that the trial court applied.
United States v. Beck, 615 F.2d 441, 447 (7th Cir. 1980).
The firmly established rule is that the court must decide
“whether at the time of the motion there was relevant
evidence from which the jury could reasonably find (defen-
dant) guilty beyond a reasonable doubt.” Id. at 447-48.
Evidence will be evaluated in the light most favorable to the
Government, bearing in mind that it is the exclusive
function of the jury to interpret witness credibility. Id.In challenging the dismissal of their motion, defendants
make two substantive arguments and one procedural argu-
ment. First, defendants argue that § 894 does not apply to
them because it was not proven that they are members of
Nos. 01-4202 & 01-4203 7
an organized crime ring, which they claim was Congress’
attempted target in passing the statute. Second, defendants
argue that § 894 should not be applied to them because the
activity being prosecuted was purely intrastate. Finally,
defendants object to the district court’s denial of their mo-
tion for judgment of acquittal without making additional
findings of fact as to evidence adduced at trial, based only
on a reference to the court’s pretrial denial of the same
motion.
Accepting the appellants’ first two arguments would force
this Court to strike down a clear and unambiguous statute
and overrule a host of case law supporting the rule that a
constitutional interpretation of 18 U.S.C. § 894 may include
both interstate and intrastate extortionate activity, regard-
less of whether the defendants are actually involved in
organized crime. See, e.g., United States v. Annerino, 495
F.2d 1159, 1164-65 (7th Cir. 1974) (“It is not necessary that
the participants in the transaction be members of organized
crime or that the particular activity has affected interstate
commerce.”). In enacting § 894 Congress stated “even where
extortionate credit transactions are purely intrastate in
character, they nevertheless directly affect interstate and
foreign commerce.” Pub. L. No. 90-321 § 200 (codified at 18
U.S.C. § 894) (1994)). Khilchenko and Babiychuk have not
presented a compelling reason for effecting such a change
in the law, and we reject their invitation to overturn this
Court’s precedent in this area.
Finally, defendants argue that their motion for judgment
of acquittal was improperly denied by the district court
because it did not make additional findings of fact regard-
ing the constitutional applicability of § 894 to the facts of
this case. In denying the motion, the district court simply
made reference to its pretrial denial of the same motion.
The defendants argue that additional findings of fact are
required by Fed. Rule of Crim. Proc. 12(e), which provides
that “where factual issues are involved in determining a
8 Nos. 01-4202 & 01-4203
motion, the court shall state its essential findings on the
record.”
Here, the district court made no findings of fact in its
post-trial denial of the defendants’ motion for acquittal. In
this case, however, the district court was under no obliga-
tion to do so. See, e.g., United States v. Annerino, 495 F.2d
1159, 1164-65 (7th Cir. 1974) (“It is not necessary that the
participants in the transaction be members of organized
crime or that the particular activity has affected interstate
commerce.”). The district court properly rejected the defen-
dants’ post-trial attack on the constitutionality of 18 U.S.C.
§ 894 by employing the same rationale it had used before
trial; namely, that Congress’ power to regulate credit
extensions has been affirmed by the Supreme Court. See,
e.g., Perez v. United States, 402 U.S. 146 (1971). Thus, the
district court’s denial of the constitutional challenges raised
by Khilchenko and Babiychuk is affirmed.
III. CONCLUSION
We are convinced that the evidence submitted justified
the jury’s findings of guilt as to each defendant, that there
was no constructive amendment of the indictment with
which the defendants were charged, and that the district
court did not err in denying the defendants’ post-trial
motion for acquittal. The convictions of Khilchenko and
Babiychuk are AFFIRMED.
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—4-7-03