UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

UNITED STATES OF AMERICA

v.

HEON SEOK LEE

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Case No. 12 CR 109

Judge Sharon Johnson Coleman

GOVERNMENT’S RESPONSE TO DEFENDANT’S RULE 29 AND RULE 34 MOTIONS 

The United States of America by its attorney, Joel R. Levin, Acting United 

States Attorney for the Northern District of Illinois, respectfully submits this 

response to defendant Heon Seok Lee’s motions under Federal Rule of Criminal 

Procedure 29 for a judgment of acquittal and Rule 34 for an arrest of judgment. See 

R. 185. For the following reasons, the government respectfully requests that the 

Court deny both motions. 

I. BACKGROUND

Defendant Heon Seok Lee was charged by indictment on February 16, 2012, 

with five counts of wire fraud, in violation of 18 U.S.C. § 1343 (Counts 1 through 5), 

and three counts of smuggling mismarked merchandise into the United States, in 

violation of 18 U.S.C. § 545 (Counts 6 through 8). R. 2. In 2015, the government 

obtained defendant’s extradition from the Republic from Korea, and defendant then 

arrived in the United States. Defendant’s trial on the charges contained in the 

indictment began March 6, 2017. After an eight-day trial, a jury returned verdicts of 

guilty on all counts of the indictment. Defendant has now moved for a new trial under 

Federal Rules of Criminal Procedure 29 and 34. See R. 185.

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The trial evidence proved that, in an effort to combat the Great Recession of 

2008, Congress passed the American Recovery and Reinvestment Act of 2009 

(“ARRA”). Under ARRA, billions of dollars in stimulus funds went in a number of 

different directions and included the disbursement of funds to municipalities and 

other local governments for the construction and renovation of wastewater treatment 

facilities through clean-water revolving loans and grants administered by states and 

the EPA. In order to receive ARRA funding to upgrade/improve wastewater 

treatment facilities, municipalities had their general contractors and engineering 

firms confirm that the contractors, subcontractors, and vendors provided 

manufactured goods that complied with the “Buy American” provision in ARRA, 

which required that manufactured goods be “substantially transformed” in the 

United States of America. General contractors and engineering firms complied by 

using ARRA certificates, which were typed documents signed by representatives from 

subcontractors and vendors, in which the subcontractors and vendors confirmed that 

they would comply with the requirements of ARRA for the manufactured goods for 

the projects. The general contractors and engineering firms collected these 

certificates from subcontractors and vendors, and, when necessary, provided them to 

the municipalities to confirm ARRA compliance. The federal EPA, in turn, conducted 

audits and reviewed the certificates. 

Defendant was the president and CEO of KTURBO and KTURBO USA 

(collectively, KTURBO). He started, ran and exercised managerial control over both 

companies. He designed and managed the design of KTURBO’s primary product and 

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its technology, which consisted of an aeration blower. KTURBO originated in the 

Republic of Korea, where defendant had his main offices, his assembly and 

manufacturing plant, and over 100 employees. Defendant eventually decided to 

expand operations to the United States where defendant chose to enter the municipal 

wastewater treatment market. 

As the evidence at trial established, defendant sought to fraudulently obtain 

federal stimulus funds that had been distributed to states and municipalities through 

ARRA. Defendant, through KTURBO, bid on and won contracts to provide blowers 

for placement in municipal wastewater treatment facilities and, along the way, 

falsely represented that KTURBO’s aeration blowers would be and were substantially 

transformed in the United States. In truth, as defendant knew and directed, 

KTURBO fully assembled its blowers in the Republic of Korea, but nonetheless placed 

placards stating the blowers were “Assembled in USA”, then shipped the fullyassembled blowers from South Korea to the United States, for distribution to 

municipalities across the country, including Indian Springs, Nevada; Lowell, 

Massachusetts; Mishawaka, Indiana; Ottawa, Illinois; Pendleton, Oregon; and South 

Burlington, Vermont.

To accomplish the fraud, defendant set up a small warehouse and office space 

in Batavia, Illinois, where defendant hired a handful of employees to work as sales 

representatives and putative assemblers. Defendant and his employees then 

represented that KTURBO would use this Batavia facility to manufacture and 

assemble aeration blowers using parts sourced from domestic and foreign suppliers 

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for municipal wastewater treatment plants. In truth, defendant saw that 

manufacturing and assembling blowers in the United States was too costly and took 

too much time in his opinion, leading defendant to decide to have blowers fully 

assembled and tested in South Korea, then shipped to the Batavia facility for a short 

period of time before shipment to municipal wastewater treatment plants across the 

country. 

The trial evidence further established that defendant and others working with 

him and at his direction lied to sales representatives, who helped sell KTURBO 

blowers for ARRA projects, as well as general contractors, project engineers, and 

municipalities who bought aeration blowers from KTURBO, believing and trusting 

that that defendant and KTURBO complied with ARRA. Defendant and his 

employees continuously lied that blowers were assembled in the United States and 

purposely hid the fact that blowers were coming fully assembled from Republic of 

Korea. These lies even made their way to the nameplates welded and riveted on the 

blowers shipped from Korea, each of which falsely proclaimed, “Assembled in the 

USA.” 

On February 24, 2011, law enforcement, pursuant to a search warrant 

authorized by a magistrate judge in the United States District Court for the Northern 

District of Illinois, searched KTURBO’s facility in Batavia, Illinois, seizing blowers 

that had been fully manufactured in the Republic of Korea as well as other relevant 

evidence. A short time after the search, defendant returned to the Republic of Korea, 

where he remained until the government obtained his extradition.

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II. LEGAL STANDARD 

A. Federal Rule of Criminal Procedure 29 

A motion for judgment of acquittal challenges the sufficiency of the evidence to 

sustain a guilty verdict against a defendant. FED. R. CRIM. P. 29. A defendant faces 

“a nearly insurmountable hurdle” in contending that the jury had insufficient 

evidence to find him guilty. United States v. Miller, 782 F.3d 793, 797 (7th Cir. 2015) 

(internal marks omitted). In reviewing a motion for a judgment of acquittal, this 

Court reviews the evidence presented to the jury in the light most favorable to the 

government and makes all reasonable inferences in the Government’s favor. See 

United States v. Cejas, 761 F.3d 717, 726 (7th Cir. 2014) (citing United States v. 

Larkins, 83 F.3d 162, 165 (7th Cir. 1996)). This Court may overturn the jury’s guilty 

verdict “only if the record is devoid of evidence from which a reasonable jury could 

find guilt beyond a reasonable doubt.” United States v. Jones, 713 F.3d 336, 340 (7th 

Cir. 2013) (internal marks omitted). It was the jury’s role to weigh the evidence and 

assess the witnesses’ credibility; courts do not “second-guess the jury’s assessment of 

the evidence.” United States v. Rollins, 544 F.3d 820, 835 (7th Cir. 2008).

B. Federal Rule of Criminal Procedure 34

Under Rule 34(a) of the Federal Rules of Criminal Procedure, “the court must 

arrest judgment if the court does not have jurisdiction of the charged offense.” This 

infrequently used rule focuses on purely legal issues, rather than the evidence 

adduced at trial. See United States v. Boender, 719 F. Supp. 2d 951, 953 (N.D. Ill. 

2010), aff’d, 649 F.3d 650 (7th Cir. 2011). 

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III. DEFENDANT’S MOTIONS FOR ACQUITTAL AND ARREST OF JUDGMENT LACK 

MERIT.

A. Application of the Recovery Act to Defendant and KTURBO

Defendant has argued in his motion and previously throughout the pendency 

of this case that ARRA did not apply to him and KTURBO.1 See R. 185 at 2. 

Consequently, defendant now argues that, if KTURBO was not subject to ARRA, 

“then it is hard to conceive how [d]efendant could have committed a crime.” Id. at 3. 

These claims misapprehend ARRA, the application of ARRA to defendant and 

KTURBO, as well the statutory violations charged against defendant. 

The indictment did not allege that defendant committed a substantive 

violation of ARRA, nor did it charge that he violated federal regulations implemented 

pursuant to ARRA. Instead, defendant was charged with violating the federal wire 

fraud statute, see 18 U.S.C. § 1343, which required proof that defendant participated 

in a scheme to defraud, the defendant did so with intent to defraud, the scheme 

involved materially false or fraudulent representations, and that the defendant 

caused interstate wire communications to take place. See R. 164 at 17 (7th Circuit 

Pattern Criminal Jury Instruction on § 1343 violation); United States v. Faruki, 803 

F.3d 847, 852 (7th Cir. 2015) United States v. Powell, 576 F.3d 482, 490 (7th Cir.

2009).

 1 Defendant has claimed that the Court “predetermined” this issue through its pretrial 

rulings, see R. 185 at 3, but that claim lacks merit. The Court simply followed the applicable 

law and made rulings consistent with the law. Any claim that the Court was biased against 

the defendant or had a predetermined view of the case lacks support in the record. 

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In an effort to squeeze his theory into the elements of wire fraud, defendant 

argues “[t]here could be no scheme outside the parameters of ARRA. If ARRA did not 

apply, a scheme to defraud could not exist.” R. 185 at 5. That argument lacks merit. 

As the Court properly instructed the jury, the scheme to defraud simply meant a 

scheme “intended to deceive or cheat another ....” Id. at 18. Neither that element, nor 

any other element of the fraud charge required proof that defendant was a recipient 

or sub-recipient of ARRA stimulus funds, let alone proof that defendant directly 

received ARRA funding from the federal government. 

While ARRA was not an element of the offense charged against the defendant, 

the application of ARRA and its Buy American provision was relevant at trial to give 

context to the false representations that defendant and those acting with him and at 

his direction made. Specifically, as the evidence at trial revealed, municipalities, their 

engineering firms, and their general contractors needed to comply with ARRA’s Buy 

American provision in order to receive federal stimulus funds for improvements to 

municipal wastewater treatment plants. As representatives from a number of 

municipalities and their general contractors as well as certain engineering firms 

testified at trial, each expected their vendors and subcontractors—including 

KTURBO—to provide goods and services that complied with ARRA’s Buy American 

provision. Defendant and his employees confirmed these representatives’ 

expectations with numerous representations regarding KTURBO’s compliance with 

the Buy American provision of ARRA, including specific representations that 

KTURBO would assemble its blowers in the United States using parts sourced from 

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domestic and foreign suppliers. These representations appeared in contracts, email 

communications, signed certifications, conversations, and presentations. Put simply, 

defendant and his employees willingly chose to represent that their business 

practices conformed to the requirements of ARRA, including its Buy American 

provision, in order to gain a stronger foothold in the United States aeration blower 

market. It was defendant who made that choice and he subsequently held KTURBO 

out as compliant with the law. He cannot now unring that bell, particularly after the 

jury has considered, weighed, and determined that defendant did, in fact, make false 

representations regarding KTURBO’s compliance with ARRA and the Buy American 

provision. 

Defendant has also challenged the evidence at trial regarding his intent, but 

those challenges also lack merit. Defendant first argues that there was no evidence 

that he “knew when he contracted with the project contractors that the Government 

was going to rely on anything he said with respect to an intent to provide blowers 

that were ARRA complaint when the time came for delivery.” R. 185 at 3-4. This 

argument mistakes the applicable legal standard. To prove wire fraud, the 

government need not establish defendant’s intent to violate the wire fraud statute; 

the government need only prove “that a defendant intended for his or her scheme to 

defraud someone[.]” United States v. Marr, 760 F.3d 733, 744 (7th Cir. 2014). 

To the extent defendant suggests he did not know that his representations 

regarding ARRA compliance were important to the EPA and the municipalities 

receiving ARRA funding, that claim is belied by the evidence at trial. Through the 

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first-hand observations of witnesses and defendant’s own PowerPoint presentation, 

the evidence established that, in November 2009, defendant invited the EPA and 

municipal representatives to his office in Batavia, Illinois, for an in-person 

presentation during which defendant gave a PowerPoint presentation detailing how 

KTURBO would assemble blowers from parts sourced from domestic and foreign 

suppliers. Likewise, the ARRA certificates signed by defendant and others working 

with him identified the municipalities where the blowers were being sent and 

indicated that the blowers would comply with the requirements of the Buy American 

provision. Email communications between defendant and his fellow employees 

(including his sister) further established defendant’s knowledge of the government’s 

role in ARRA oversight, as well as the regulatory framework that he was subjecting 

himself to by holding KTURBO out as compliant with ARRA. 

During trial, witnesses, namely, people formerly employed by KTURBO USA 

testified about their interactions with defendant, their understanding of the 

requirements of ARRA based on their employment at KTURBO USA, as well as their 

observations of how fully-assembled blowers were shipped from KTURBO’s Korean 

facility to the Batavia facility for ARRA projects contrary to the representations 

KTURBO made to customers. Defendant challenges the value of the testimony by 

these former employees, arguing that “their misapprehensions over whether ARRA

applied has no evidentiary value. Their testimony does not make something true 

when in reality it wasn’t.” R. 185 at 4. This argument misses the mark. The testimony 

of former employees, including Joel Schomo, John Jansouzian, and Kim Woelffer, 

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about their understanding of ARRA, the Buy American provision, and their 

understanding of what they understood those provisions to require of KTURBO gave 

relevant context to the jury for (a) what the defendant knew, (b) what he discussed 

with his employees, (c) how he was aware of the requirements of ARRA, and (d) how 

he purposely flouted those requirements even after his employees came to him with 

their concerns. It was the province of the jury to weigh, consider, and find credible 

these witnesses’ testimony; defendant’s second-guessing post-conviction is 

unavailing. See United States v. Reed, 875 F.2d 107, 111 (7th Cir. 1989).

Defendant also relies on the Second Circuit’s decision in United States ex rel. 

O’Donnell v. Countrywide Home Loans, 822 F.3d 650 (2d. Cir. 2016), in an effort to 

seek acquittal, but that reliance is misplaced. That case, as the Court knows from 

pretrial motion practice, stands only for the noncontroversial proposition that fraud 

cannot be “based solely on contractual breach,” where “the only representations 

involved in th[e] case are contained within contracts” and there is no proof that the 

defendant “made any later misrepresentations—i.e., ones not contained in the 

contracts—as to which fraudulent intent could be found.” Id. at 656, 658, 663. The 

Second Circuit explained that its holding did not extend to cases, like this one, where 

the defendant “made affirmative fraudulent misrepresentations to their contractual 

counterparties in the course of performance or to feign performance under the 

contract.” Id. at 658; see also id. at 661 n.12.

Specifically, the jury received evidence that defendant and his employees made 

intentionally false misrepresentations throughout the course of the scheme, contrary 

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to defendant’s suggestion that the statements about ARRA compliance were confined 

to a six-month period. See R. 185 at 4. For instance, as early as November 25, 2009, 

one of defendant’s employees sent an email to Shawn Clark, a West Coast sales 

representative who worked on the Pendleton project, and included defendant on the 

email, in which the employee stated, “KTurbo meet [sic] the ARRA requirements. 

Please find attached document for ARRA requirement.” Gov. Ex. 907. Attached to the 

email were photographs of the Batavia facility exterior and interior, as well as 

photographs of the Korean manufacturing facility where blowers were actually being 

manufactured, which the jury was entitled to consider as included by the employee 

in order to give the false impression that the Batavia facility had the capacity to 

assemble blowers at that time. Another example is the email communication 

employee Joel Schomo sent to Ottawa’s engineering firm on January 10, 2011, 

providing a certification signed by Trinity Lee (defendant’s sister and coconspirator) 

that falsely represented, “All of the manufacturing processes for Ottawa project will 

be done within the united states [sic] except for the following. ... All assembly of the 

completed unit will be executed domestically. ... The domestic 

manufacturing/assembly process on average takes 40 man/hours to complete.” Gov. 

Ex. 606 at 3. As the evidence demonstrated at trial, these false representations 

occurred months after defendant made the decision to discontinue KTURBO’s 

relationships with domestic suppliers of blower packages (like Tru-Way, as a 

representative from that company testified), and after defendant made the decision 

to ship blowers fully assembled from Korea to the Batavia facility in order to save 

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time and money. Indeed, the evidence demonstrated that the Ottawa blowers arrived 

fully assembled in the United States on January 4, 2011, days before the false 

representations were made. See Gov. Ex. 205. Furthermore, defendant himself made 

false representations during the course of the scheme, including an email 

communication dated January 28, 2011, when defendant was asked by a sales 

representative whether KTURBO was having “any issues with ARRA oversight ....” 

Gov. Ex. 137. Defendant lied in response, stating, “It depend [sic] on project 

requirement. Most important parts is final assembly and testing. We are doing those. 

So, we are compliant.” Id.

Unlike in Countrywide, the jury in this case received extensive evidence of 

material omissions and active concealment by defendant and his employees, which 

appropriately forms the basis for a wire fraud violation. See Countrywide, 822 F.3d 

at 665, n.18 (“As we noted above, the jury was not charged as to—and therefore could 

not have found—liability as a result of fraudulent silence.”). Specifically, the jury 

heard and credited the testimony of former employee John Jansouzian, who testified

he was hired to assemble blowers for KTURBO at the Batavia facility, but he only 

ended up testing blowers that were shipped fully assembled from Korea. See Tr. 518-

21. Jansouzian testified that he told the defendant that the blowers arrived fully 

assembled and defendant instructed him to not tell customers that they had not been 

built in KTURBO’s shop. See Tr. 521. As the Seventh Circuit observed in United 

States v. Biesiadecki, 933 F.2d 539, 543 (7th Cir. 1991), “[w]e held in United States v. 

Keplinger, 776 F.2d 678, 697 (7th Cir.1985), that ‘omissions or concealment of 

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material information can constitute fraud ... cognizable under the mail fraud statute, 

without proof of a duty to disclose the information pursuant to a specific statute or 

regulation.’” The Seventh Circuit confirmed this principal in United States v. 

Palumbo Bros., 145 F.3d 850, 868 (7th Cir. 1998), where it held that “mail fraud 

applies broadly to schemes that deprive individuals of money by making a false 

statement, or providing a half truth that is misleading, expecting that individual to 

act upon it to his detriment. We also have determined that the omission or 

concealment of material information, even when a statute or regulation does not 

impose a duty to disclose, constitutes mail fraud.” (internal citations omitted).

In summary, the evidence presented at trial established beyond a reasonable 

doubt that defendant intentionally participated in a scheme to defraud customers 

regarding the location of manufacturing for KTURBO blowers in order to obtain 

contracts and payment for those blowers, using materially misrepresentations, the 

omission of material facts, as well as through the active concealment of facts, and in 

the course of the scheme caused email communications (wire transmissions) to be 

sent in furtherance of the scheme. Defendant’s request for judgments of acquittal on 

Counts One through Five should be denied accordingly. 

B. The Republic of Korea’s Participation in the World Trade 

Organization Does Not Bar Defendant’s Wire Fraud Convictions. 

There is no merit to defendant’s claims that the World Trade Organization 

Government Procurement Agreement stand in the way of the jury’s findings of guilt 

on the wire fraud charges. See R. 185 at 7-8. The WTO did not apply, and it did not 

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exempt the defendant or KTurbo from complying with the Recovery Act’s “Buy 

American” requirements. 

ARRA prohibited the use of stimulus funds unless all of the iron, steel, and 

manufactured goods used in the project were produced in the United States and that 

this “Buy American” provision was to be applied in a manner consistent with United 

States obligations under international agreements. According to implementing 

regulations, the Buy American provision did not apply where the iron, steel or 

manufactured goods were from a party to an international agreement that obligated 

the recipient to treat the goods and services of that party the same as domestic goods 

and services. Because South Korea was a designated country in the World Trade 

Organization Government Procurement Agreement, the United States government, 

which was also a designated country in the WTO Government Procurement 

Agreement, was required to treat manufactured goods from Korea as domestic goods 

when procuring such goods. See Revised Agreement on Government Procurement, 

Apr. 2, 2012, art. IV, 33 I.L.M. 1125. 

As the Court is aware, however, the federal government has the constitutional 

authority to create binding foreign treaties, while each state is allowed to limit the 

application of an agreement to certain agencies and to exclude the purchase of 

particular goods or services. See Kevin McNiff, The Use of Federal Grant-Making 

Power To Expand State and Local Procurement Coverage Under the Transatlantic 

Trade and Investment Partnership, 44 Pub. Cont. L.J. 327, 332-333 (Winter 2015). 

When the United States government entered into the WTO Government Procurement 

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Agreement, only thirty-seven states agreed to grant parties to the agreement access 

to some of their procurement markets, and those states reserved the right to 

discriminate against foreign contractors on public utilities projects. Id. But none of 

the municipalities at issue in this case were parties to the WTO Government 

Procurement Agreement. Because the municipalities were not parties to the 

agreement, they were obligated to use stimulus funds pursuant to the terms of ARRA 

and the WTO did not apply. Tellingly, none of the certifications, representations, and 

communications issued by defendant and his employees during the scheme invoked 

the WTO and not one even suggested that the WTO applied. 

C. Defendant’s Substantial Transformation Argument Lacks Merit. 

There is no merit to defendant’s argument that KTURBO satisfied the 

requirements of substantial transformation in the United States for the municipal 

wastewater treatment projects discussed during trial. See R. 8-13. During trial and 

now post-trial, defendant argues that KTURBO complied with two of the five criteria 

for substantial transformed articulated in EPA guidance. That argument was 

necessarily rejected by the jury, as it found that defendant participated in a scheme 

to defraud involving false representations regarding ARRA compliance and 

compliance with the Buy American provision. Unhappy with the jury’s findings, 

defendant now asks for the evidence to be reweighed and for his argument to be 

accepted. That effort should be rejected by the Court. 

For instance, defendant wrongly points to the entire project as being the good 

or service that needed to be substantially transformed in the United States. The 

representations by defendant and his employees referred to the blower—not the 

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entire wastewater treatment project—when discussing substantial transformation 

with customers and in their presentations and pitches to obtain business. There was 

no evidence that defendant, during the scheme, believed anything else to be true as 

reflected in his numerous email communications and oral communications in which 

he specifically discussed blowers as being substantially transformed at the Batavia 

facility, not the entire projects. Indeed, defendant’s own PowerPoint presentation, in 

which defendant claimed that the blowers’ ingot, rotor, packaging, pipes, silencer, 

check valve, isolation valve, power-in assembly, control assembly, air and harmonic 

filters (reflecting 40% of cost) would be made in America, while the motor assembly, 

VFD assembly, and blow-off valve (reflecting 50% of cost) would be imported from 

Korea, with the assembly and testing of the blowers by American labor would 

complete the project (and account for 10% of cost). See Gov. Ex. 103 at 46. That 

PowerPoint also provided a diagram identifying which parts were to originate 

domestically and abroad. See id. at 44. 

Likewise, defendant’s arguments about testing and assembly of the blowers on 

site was belied by the credible and reliable evidence presented at trial. During the 

government’s case-in-chief, the jury received evidence that (a) blowers were fully 

assembled in Korea before they arrived at KTURBO’s Batavia facility; (b) the blowers 

had hours of run-time on them when they arrived, indicating that they had been 

operated in Korea before shipment; (c) the blowers had been tested prior to shipment 

from Korea, as reflected in email communications to municipal representatives; and 

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(d) the municipalities, including their general contractor and engineering firm, were 

responsible for installation of the blowers upon arrival, not KTURBO. 

Defendant has also reargued his claim that the grand jury was misled by the 

government. That claim, of course, has been litigated extensively during the 

pendency of this case with rulings adverse to defendant. Nothing defendant has 

argued post-trial changes that result. Indeed, as discussed below, the petit jury’s 

finding of guilt renders any alleged error harmless beyond a reasonable doubt. 

D. There Is No Merit to Defendant’s Due Process Claim

Defendant argues that the term “substantial transformation” is 

unconstitutionally vague and cannot be a basis for a criminal conviction. See R. 185 

at 13. That argument lacks merit and should be rejected. 

To begin with, the vagueness doctrine applies to criminal statutes and, as 

discussed above, defendant was not charged with a regulatory violation of the Buy 

American provision. As the Seventh Circuit has held, a criminal statute “may operate 

in an unconstitutionally vague manner if it: 1) does not provide a person of ordinary 

intelligence a reasonable opportunity to know what is prohibited, or 2) fails to provide 

explicit standards to prevent arbitrary and discriminatory enforcement by those 

enforcing the statute.” United States v. Lim, 444 F.3d 910, 915 (7th Cir. 2006). The 

Seventh Circuit has observed that this rule applies to criminal statutes, which must 

provide notice of the prohibited conduct to ‘a reasonable degree of certainty,’ but ‘the 

practical necessities of discharging the business of government inevitably limit the 

specificity with which legislators can spell out prohibitions.’” Id. quoting Boyce Motor 

Lines v. United States, 342 U.S. 337, 340 (1952). Moreover, as established at trial, 

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defendant and his employees did not simply represent that he would comply with the 

Buy American provision, nor did he and his employees simply represent that

KTURBO would substantially transform blowers in the United States. Instead, they 

made specific representations regarding the level of assembly, manufacturing, and 

sourcing of parts that would comprise each blower, see, e.g., Gov. Exs. 103, 137, 606. 

E. The Evidence Sufficiently Established Defendant’s Violation of 

18 U.S.C. § 545. 

Defendant challenges his conviction on Counts 6 through 8 of the indictment, 

which charged him with violating 18 U.S.C. § 545, which requires the government to 

prove (1) that defendant imported or brought into the United States merchandise; (2) 

the importation or bringing into the United States of the merchandise was contrary 

to law; and (3) defendant acting knowingly or fraudulently. 

First, defendant claims the second element was not satisfied because the 

“evidence was that the articles were marked,” specifically claiming, that the “statute 

was not violated by the mis-marking and clearly there was no intent to violate the 

statute given the fact that the papers accompanying the shipments identified they 

had been imported from Korea.” R. 185 at 15-16. To begin with, defendant offers no 

precedent for his claim that § 1304 only applies to unmarked goods and not 

mismarked goods. A plain reading of the statute, which is the first step in statutory 

interpretation, establishes that the statute covers both unmarked and mismarked 

goods as the statute requires that goods be marked “to indicate ... the English name 

of the country of origin of the article.” 19 U.S.C. § 1304(a). Regardless of whether a 

good is unmarked or falsely identifies the country of origin, the ultimate purchaser 

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has been misinformed. If anything, when defendant and his employees falsely 

marked the blowers (which were plastic-wrapped and placed inside opaque wooden 

crates) and then identified on the shipping documentation that the blowers originated 

in Korea, this latter step is reasonably viewed as an attempt by defendant and his 

employees to ensure that customs inspectors would not open the crates to conduct a 

further inspection into how the blowers were marked. 

Second, defendant wrongly argues that defendant and KTURBO USA were the 

ultimate purchasers of the blowers imported from Korea. See R. 185 at 16. Defendant 

requested and the Court gave the jury an instruction on the definition of an ultimate 

purchaser, which was “generally the last person in the United States who will receive 

the article in the form in which it was imported.” R. 164 at 33. As the evidence 

established at trial, aeration blowers for ARRA-funded projects had no work done on 

them at KTURBO’s Batavia facility before being shipped to municipal wastewater 

treatment facilities. No substantial transformation of the blowers occurred at the 

Batavia facility or on-site that could have turned defendant and KTURBO USA into 

“ultimate purchasers.” 

F. Defendant’s Claim of Grand Jury Misconduct Should Be 

Rejected. 

Defendant reargues his claim that the government presented misleading 

evidence to the grand jury prior to indictment. See R. 185 at 17-20. Even assuming 

for the sake of argument that grand jury error occurred, the petit jury’s finding of 

guilt against defendant on all counts of the indictment renders any alleged error 

harmless beyond a reasonable doubt. 

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As the Seventh Circuit has held, a petit jury’s finding of guilt beyond a 

reasonable doubt demonstrates probable cause to return an indictment, regardless of 

alleged misconduct before the grand jury. United States v. Mechanik, 475 U.S. 66, 72-

73 (1986). In other words, defendant’s conviction renders harmless any “conceiveable 

error in the charging decision” before the grand jury. Id. at 73. For example, in United 

States v. Vincent, 416 F.3d 593 (7th Cir. 2005), a defendant convicted at trial of mail 

and wire fraud charges claimed that perjury before the grand jury required dismissal 

of the charges against him. Applying Mechanik, the Seventh Circuit held: “Even if 

errors in the grand jury proceedings would have justified the district court in 

dismissing the indictment prior to trial, the petit jury’s subsequent conviction of 

[defendant] rendered these errors harmless beyond a reasonable doubt.” Id. at 601; 

see also United States v. Morgan, 384 F.3d 439, 443 (7th Cir. 2004) (holding that a 

petit jury’s conviction rendered harmless any error from alleged perjury during grand 

jury proceedings). 

The only “prejudice” defendant could possibly complain is that he had to stand 

trial and was ultimately convicted; this, of course, is insufficient to afford him relief. 

Thus, the petit jury’s conviction of defendant on the wire fraud counts rendered the 

claimed error of prejudice before the grand jury harmless beyond a reasonable doubt.

G. Defendant’s Motions to Dismiss Continue to Lack Merit.

In cursory fashion, defendant incorporates by reference his prior arguments in 

support of his motion to dismiss, which the Court previously denied. Defendant has 

not provided any additional facts, law or analysis that may support his arguments. 

Because defendant has not offered any meaningful reason or basis for the Court to 

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reconsider its prior rulings, his motions should be denied. See United States v. Mojica, 

No. 12 CR 755-5, 2016 WL 3268991, at *3 (N.D. Ill. June 15, 2016). 

H. The Government Did Not Violate the Rule of Specialty. 

According to defendant, the government changed its theory from extradition to 

trial, violating the rule of specialty. R. 185 at 21-22. As an initial matter, defendant 

lacks standing to bring this claim. See United States v. Burke, 425 F.3d 400, 408 (7th 

Cir. 2005) (“[E]xtradition treaties do not create personal rights enforceable by 

criminal defendants.... Instead they create rules for the relations between nations.”); 

but see United States v. Stokes, 726 F.3d 880, 888-89 (citing United States v. Rauscher, 

119 U.S. 407 (1886)). As the Seventh Circuit previously held, a defendant lacks 

“standing to challenge violations of international treaties in the absence of a protest 

by the sovereigns involved.” Matta-Ballesteros v. Henman, 896 F.2d 255, 259 (7th Cir.

1990). In this case, defendant has presented no evidence of any protest from the 

Republic of Korea and thus he lacks standing to raise a challenge under the 

extradition treaty. See United States v. Nduribe, 14 C 525, 2014 WL 1856761, at *2 

(N.D. Ill. May 6, 2014) (Der-Yeghiayan, J., presiding); United States v. Stokes, 2010 

WL 1874281, at *3 (N.D. Ill. May 10, 2010) (Pallmeyer, J., presiding). 

Second, defendant’s claimed violation of the rule of specialty fails on the merits. 

Under the rule of specialty, an extradited defendant may only be prosecuted for the 

specific crimes for which he was extradited. United States v. Warda, 285 F.3d 573, 

575-76 (7th Cir.2002) (“[T]he Rule of Specialty ... does not allow the country to which 

an individual is extradited to prosecute that person for a crime unless the extraditing 

nation has expressly authorized such a prosecution.”). In this case, the government 

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sought defendant’s extradition on the same charges presented to the jury in this case. 

The only difference was immaterial; the Court granted the government’s motion to 

strike an allegation in the indictment regarding loss, which the Court properly held 

was surplusage and not an element of the offense charged in Counts 1 through 5. 

I. Defendant’s Jurisdictional Claims Continue to Lack Merit. 

Defendant remakes his prior argument that this Court lacks jurisdiction over 

the his criminal violations of 18 U.S.C. § 545, which are based on 19 U.S.C. § 1304. 

See R. 185 at 22-23. This argument has been addressed by the Court and rejected. 

See R. 142. Defendant provides no basis for the Court to revisit its ruling and the 

motion should remain denied. 

IV. CONCLUSION 

For the reasons stated herein, the government respectfully requests that the 

Court deny defendant’s motions under Federal Rules of Criminal Procedure 29 and 

34. 

Respectfully submitted,

JOEL R. LEVIN

Acting United States Attorney

By: s/ Patrick M. Otlewski

PATRICK M. OTLEWSKI

MEGAN CUNNIFF CHURCH

Assistant U.S. Attorneys

219 South Dearborn St., Rm. 500

Chicago, Illinois 60604

(312) 353-5300

Dated: July 14, 2017

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