Court Opinion

ID: 2999474
Source: CourtListenerOpinion
Date Created: 2015-09-24 19:54:27.088185+00
Date Added: 2024-06-11T11:45:38.479289
License: Public Domain

In the
 United States Court of Appeals
               For the Seventh Circuit
                          ____________

No. 05-2275
UNITED STATES OF AMERICA,
                                                 Plaintiff-Appellee,
                                 v.

MILKO MITOV,
                                            Defendant-Appellant.
                          ____________
            Appeal from the United States District Court
       for the Northern District of Illinois, Eastern Division.
         No. 02 CR 723—Harry D. Leinenweber, Judge.
                          ____________
   ARGUED FEBRUARY 9, 2006—DECIDED AUGUST 21, 2006
                    ____________

  Before BAUER, EASTERBROOK, and WOOD, Circuit Judges.
  BAUER, Circuit Judge. Because of actions stemming from
Milko Mitov’s mistaken belief that “everybody takes money
in the United States,” a jury convicted him of attempted
extortion under the Hobbs Act, 18 U.S.C. § 1951. On appeal,
he attacks the form of his indictment, evidentiary decisions
made by the trial court, the sufficiency of the evidence
leading to his conviction, and his sentence. We affirm.

                        I. Background
  In late 2000, Jay Berlinsky was contacted by Steven Japp,
an executive with a corporate client, the family-owned Jays
Potato Chip Company, on a personal legal matter. Steven
2                                                    No. 05-2275

was concerned about the estate of his recently deceased
grandfather, Leonard Japp, Sr. Leonard had died in August
2000 at the age of 96, and he left his entire estate to his
third wife, Janice. This distribution was contrary to Ste-
ven’s expectations, and he and his relatives suspected
undue influence on the part of the beneficiaries. Because
Berlinsky, an attorney with the law firm of Schwartz,
Cooper, Greenberger, and Krauss,1 represented the com-
pany in their corporate legal affairs, he referred the case to
his partner, Richard Schultz. Schultz specialized in the
litigation of such matters, and he agreed to represent
Steven and his relatives.
  When Schultz was conducting his initial research on the
matter, the Japp family put him in touch with Milko Mitov.
Mitov had worked as Leonard’s caretaker in the Japp
household from November 1998 to January 2000. During
that time he was in close contact with the elderly patriarch.
  On January 4, 2001, Schultz and his associate Brad
Springer met with Mitov at his then current workplace in
a suburb of Milwaukee, Wisconsin. During the course of the
interview Schultz and Mitov discussed what Mitov
had observed in the Japp household during his fifteen
months of employment. The meeting was conducted in
English, and the men had little trouble understanding each
other. Springer took notes during the course of the discus-
sion. At the conclusion of the meeting, Schultz believed
Mitov was an important witness in the case for undue
influence.
  In February 2001, Schultz filed a civil complaint in
DuPage County Circuit Court on behalf of Steven Japp, and
members of his family, contesting certain amendments
made to the structure of Leonard Japp, Sr.’s estate. The
complaint was based in large part on the information

1
    Hereinafter referred to as “Schwartz, Cooper.”
No. 05-2275                                                   3

provided by Mitov. In anticipation of the legal proceeding to
follow, Schultz notified Mitov that he and other attorneys
would likely contact him again in the coming months.
  Over the course of the next year, however, obtaining
Mitov’s testimony became a major issue in the civil suit. On
June 26, 2001, Schultz and Mitov met at the office of
Schwartz, Cooper to discuss the deposition schedule. But
Mitov had a different agenda. Schultz testified that Mitov
demanded $100,000, tax-free, in exchange for his testimony
in the civil suit. The payment was to be made in five to ten
days to a Bulgarian radio station identified specifically by
a pamphlet that Mitov brought to the meeting. He threat-
ened that, should the payment not be made, he would forget
his testimony and pretend to be unable to speak English at
his deposition. Schultz rejected the proposition and asked
Mitov if he was joking. He was not. Schultz then informed
him that to pay for his testimony would be a crime, and that
“[w]e don’t do that in the United States.” Trial Tr. vol. 1, 41,
June 8, 2004. Mitov disagreed: “Don’t tell me how things
are done in the United States. Everybody takes money in
the United States.” Id.
  Schultz testified that he repeatedly attempted to dissuade
Mitov from this demand. But Mitov told Schultz that the
Japps stood to profit from the suit and that his testimony
was going to help them do that. The payment was in
exchange for this help. Mitov then informed Schultz that
should he not be paid, he would take a job in Texas where
Schultz would never find him. Mitov closed his remarks by
noting: “I’m not going to change my mind. You’re going to
pay me the $100,000 or you’re not going to get my testi-
mony.” Trial Tr. vol. 1, 42, June 8, 2004. At the close of this,
and each subsequent meeting with Mitov, Schultz made a
memo recording the substance of the conversation.
  Schultz further testified that over the course of the
next three months Mitov reiterated his demand for pay-
4                                                 No. 05-2275

ment. On July 10, 2001, Mitov phoned Schultz and asked if
he was going to pay the $100,000. This time Mitov set the
deadline for 5 p.m. that day. Schultz again refused, and
took the opportunity to remind him that what he was doing
was wrong; that it was a crime. Additionally, he asked
Mitov to meet with him again at his office so that they could
discuss the consequences of the demand. Mitov told Schultz
he would consider the meeting, and asked Schultz to call
him the next day. When Schultz made the call on July 12,
however, Mitov again demanded payment. At the end of the
conversation, Schultz convinced Mitov to meet in person
again.
   On Friday, July 13, 2001, Schultz and Berlinsky met with
Mitov in person in an attempt to change his mind. Schultz
testified that he told Mitov it was illegal to demand pay-
ment for his testimony, that doing so was “. . . extortion. It’s
a criminal violation.” Trial Rec. vol. 1, 47, June 8, 2004.
Their actions were to no avail: Mitov responded by raising
his demand. He told them he wanted $100,000 before and
another $100,000 after the trial. Again, he told them the
first payment should be made to the Bulgarian radio
station. During this meeting Mitov also told them that he
was afraid of Eric Koenig, Janice Japp’s son-in-law. Schultz
told him that if he was afraid they should contact the
authorities to obtain protection. At the close of the discus-
sion Schultz handed Mitov his deposition subpoena with the
date set for August 14, 2001.
  Schultz testified that Mitov came to see him again on July
18, 2001, and the meeting followed a familiar arc. Initially
Mitov told Schultz he would testify truthfully, but then
added he would do so only in exchange for payment.
Additionally, Schultz testified Mitov told him the Japp
family had already paid him $300 for information and
loaned him money to purchase a car during his term of
employment. Lastly, Mitov claimed that Schultz had
No. 05-2275                                                  5

already promised to pay him the $100,000, a claim which
Schultz denied.
  After repeatedly meeting with Schultz, Mitov turned his
attention to Berlinsky. The two men met twice, first on
August 6, and again on August 8, 2001. Berlinksy testified
that over the course of the meetings he tried to convince
Mitov to testify without payment, and Mitov attempted to
persuade him to come up with the money. Neither men
were successful in their endeavor. Mitov did not attend
his scheduled deposition on August 14, 2001, and his
deposition was never taken.
   After Mitov failed to attend his deposition, Schultz
doubted the possibility of succeeding in the Japp estate
dispute. He testified that the complaint relied heavily on
information Mitov provided in the January meeting, and
that even if Mitov were to testify at a later date, he would
have had to notify opposing counsel of the demand for
payment. Schultz stated that “[t]he clients had brought to
us an undue influence case, which I thought was a very
viable case and it just disintegrated in our hands and the
clients were not going to achieve the kind of success they
were entitled to, in my opinion.” Trial Tr. vol. 1, 55, June 8,
2004. When asked why he chose not to compel Mitov’s
testimony, Schultz replied that, strategically, there
would have been no point: “Mr. Mitov told us he wasn’t
going to tell the truth[,] and pretend he couldn’t understand
English but, in addition to that, by this time, no matter
what he said, he had destroyed his own credibility . . . once
you are selling your testimony, [you are] not a credible
witness.” Trial Tr. vol. 1, 56-57, June 8, 2004.
  Schultz contacted the United State’s Attorney’s Office
concerning the matter shortly after the aborted deposition.
On September 10, 2001, Schultz and Berlinsky met with
Assistant United States Attorney Madeleine Murphy and
Special Agent Tina Fourkas of the Federal Bureau of
6                                              No. 05-2275

Investigation (FBI) and reported Mitov’s demands. Agent
Fourkas then contacted Steven Japp, who agreed to
assist the FBI in investigating the matter.
  On January 15, 2002, Steven phoned Mitov and ar-
ranged to meet him the next day at a restaurant. This
phone call and three subsequent conversations between
Steven and Mitov were all recorded by Agent Fourkas. At
the restaurant, Steven asked Mitov to attend the deposi-
tion. Mitov told him that would be deposed only if he was
paid. He demanded the payment be wired to his cousin in
Luxembourg: “I got a cousin, he’s a very big doctor in
Luxembourg . . . send money there, nobody knows about the
money, nothing . . . Two hundred thousand. Two hundred
thousand dollars.” Trial Tr. vol. 2, 174, June 9, 2004. In a
follow-up conversation on May 30, 2002, Steven asked
Mitov what would happen if he didn’t pay; Mitov responded:
“I got information that you say goodby [sic] to. What about
that?” Trial Tr. vol. 2, 183, June 9, 2004.
  On July 24, 2002, a grand jury returned an indictment
charging Mitov with three counts of attempted extortion
in violation of the Hobbs Act, 18 U.S.C. § 1951.
  In the weeks before the criminal trial, Schwartz, Cooper
settled the Japp estate dispute. Schultz testified that
Steven Japp was unhappy with the result, and that he
was concerned about the impact of the loss on his reputa-
tion in the legal community. Additionally, because the case
did not proceed properly, the firm was forced to discount
their fees: “When a case goes bad like this one did, we
discount everything, including expenses.” Trial Tr. vol. 1,
70, June 8, 2004. Following the settlement, Schwartz,
Cooper produced their notes and documentation pertain-
ing to the civil suit. This material had previously been
withheld pursuant to a claim of work-product privilege.
  In his defense, Mitov stated that he demanded payment
for his testimony because members of the Japp family had
No. 05-2275                                                 7

previously promised to pay him for the information. He
testified to conveying this promise to Schultz when they
first spoke on the phone in January 2001, and again to
Springer at the close of their January 4 meeting. Both men,
he stated, agreed to pay him. But Mitov acknowledged that
when he visited Schultz in his office, Schultz denied having
agreed to pay him. He further testified that Schultz told
him that paying for his testimony was illegal, and that he
understood that if something was illegal it was “against the
law.” Trial Tr. vol. 2, 233, June 9, 2004. On cross-examina-
tion, Mitov admitted to directing Steven Japp to send
$200,000 to his cousin in Luxembourg. Mitov also testified
that he sought the money out of fear of Eric Koenig, and
that he would have used the money to ensure his own
protection.
  On June 10, 2004, the jury found Mitov guilty as charged
in all three counts of the indictment. On appeal, Mitov
argues that (1) the district court constructively amended the
indictment, (2) the government failed to prove elements of
the crime as charged, (3) the district court erred in not
admitting additional evidence from the underlying civil
case, and (4) that the findings made at his sentencing were
contrary to United States v. Booker, 543 U.S. 220 (2005).

                       II. Analysis
  A. The Indictment
  Mitov first claims that the district court erred in granting
the government’s motion to amend the date on count one of
the indictment. He argues that the date change violated his
Fifth Amendment right to be tried on indictments brought
by a grand jury. U.S. CONST. amend. V. A constructive
amendment to an indictment “ ‘occurs when either the
government . . . , the court . . . , or both, broadens the
possible bases for conviction beyond those presented by the
grand jury.’ ” United States v. Cusimano, 148 F.3d 824, 829
8                                                No. 05-2275

(7th Cir. 1998) (citing United States v. Floresca, 38 F.3d
706, 710 (4th Cir. 1994)). Whether the change allowed at
trial amounted to an impermissible constructive amend-
ment is a question of law that we review de novo. United
States v. Trennell, 290 F.3d 881, 886 (7th Cir. 2002); see also
United States v. Alhalabi, 443 F.3d 605, 614 (7th Cir. 2006).
    Count one of the indictment charged that:
     On or about June 1, 2001, . . . MILKO MITOV . . .
     knowingly attempted to affect commerce by extortion,
     in that defendant attempted to obtain property in the
     form of payments from attorneys of Schwartz, Cooper,
     Greenberger and Krauss, whose consent defendant
     attempted to induce by the wrongful use of actual
     and threatened fear of economic harm.”
R.1. The June 1, 2001, date was erroneously noted by Agent
Fourkas in her September 10, 2001, meeting with Schultz
and Berlinsky. The government did not learn of the error
until, in the days before trial, the attorneys of Schwartz,
Cooper turned over their notes from the underlying civil
suit. In reviewing the notes, the government realized that
the meeting between Mitov, Schultz and Berlinsky, in
which Mitov first made his demand in person, actually
occurred on July 13, 2001. On June 7, 2004, the day before
Mitov’s trial began, the government moved to amend the
indictment and correct the error. Before granting the
motion, the district court asked Mitov if he would suffer any
prejudice from this change. Defense counsel responded only
by noting generally that their case had been “based on the
indictment as it was written.” Trial Tr. vol. 1, 2-3, June 8,
2004. At no point during the trial did Mitov raise a defense
that went to the date or timing of the criminal demand.
  For a change in the indictment to rise to the level of a
constructive amendment, it must establish an offense
different from, or in addition to, those originally charged.
See Trennell, 290 F.3d at 888. As such, we are primarily
No. 05-2275                                                 9

concerned with changes made to the indictment that affect
elements of the crime. United States v. Krilich, 159 F.3d
1020, 1027 (7th Cir. 1998). In a charge of extortion, how-
ever, the date is not an element of the offense. See id.; 18
U.S.C. § 1951. Further, where the charge is worded so
broadly as to state “ ‘on or about’ a certain date, the defen-
dant is deemed to be on notice that the charge is not limited
to a specific date.” United States v. Folks, 236 F.3d 384, 391
(7th Cir. 2001) (citing United States v. Leibowitz, 857 F.2d
373, 379 (7th Cir. 1988)). Given the broad wording of count
one as offered by the grand jury, and the fact that the
changed date fell before the date of the indictment itself and
within the statute of limitations, we find that the district
court did not err in granting the government’s motion. See
id.

  B. The Conviction
  Mitov next argues that the evidence presented at trial
was insufficient to convict him of attempted extortion,
despite the jury’s verdict. Our review of such a claim is
highly deferential towards the decision reached at trial, and
we may reverse the conviction “ ‘only when the record is
devoid of any evidence, regardless of how it is weighed, from
which a jury could find guilt beyond a reasonable doubt.’ ”
United States v. Gracia, 272 F.3d 866, 873 (7th Cir. 2001)
(citing United States v. Garcia, 35 F.3d 1125, 1128 (7th Cir.
1994)). As if this hurdle was not high enough, Mitov failed
to raise these challenges before the district court, and so we
review only for plain error. United States v. Cummings, 395
F.3d 392, 397 (7th Cir. 2005). Mitov, therefore, must
demonstrate a manifest miscarriage of justice. United
States v. Meadows, 91 F.3d 851, 854-55 (7th Cir. 1996).
  To support the conviction of attempted extortion under
18 U.S.C. § 1951, the government had to prove, beyond a
reasonable doubt, that Mitov wrongfully used force or fear,
10                                                No. 05-2275

including fear of economic harm, to obtain money or
property, with their consent, from Schwartz, Cooper and
Steven Japp. § 1951(b)(2); see also United States v.
Granados, 142 F.3d 1016, 1019-20 (7th Cir. 1998). This fear
of economic harm need not be certain, it must only
be reasonable. Granados, 142 F.3d at 1020. Additionally,
the extortion must be shown to affect interstate commerce.
§ 1951(a). Mitov contends that the government failed to
show both that the victims’ fear was reasonable and that
the attempted extortion affected commerce.
  Mitov’s primary claim regarding the reasonableness of the
victims’ fear of economic harm is that the underlying state
suit was destined to fail. Therefore, any hope of success and
possible economic profit was unreasonable. But this argu-
ment demands a showing of certainty of success in the
underlying suit, not reasonableness, and thus goes farther
than the statute requires. In the instant case, if the victims
had a reasonable belief in some form of success and profit
from the civil suit, a threat to that profit may create a
reasonable fear of economic harm. Concurrently, in the
State of Illinois, a will containing an attestation clause
disclosing that all of the statutory requirements have been
met, and evidencing admittedly genuine signatures,
establishes a prima facie case favoring due execution of the
will. In re Estate of Chlebos, 194 Ill. App. 3d 46, 50-51 (Ill.
App. 1990). But this is a rebuttable presumption, and not
every case challenging a will is certain to fail. Id.; see In re
Estate of Jacobson, 75 Ill. App. 3d 102, 107 (Ill. App. 1979)
(denying admission of will to probate where evidence
demonstrating soundness of testator’s mind was “patently
insufficient”). A seasoned attorney such as Schultz may
therefore be found by the jury to have had a reasonable
chance of some form of success and profit, and thus a
reasonable fear of harm upon hearing Mitov’s demand.
  At trial, the government used Schultz’s testimony to prove
the offense charged in count one, Mitov’s attempted extor-
No. 05-2275                                                 11

tion of Schwartz, Cooper. Schultz testified to his expectation
of success in the underlying civil suit, the negative effect of
Mitov’s demand for payment on that suit, and his fear of
repercussions within the legal community for the reputation
of his firm. He stated that Steven Japp and members of his
family brought him a “very viable case,” based in large part
on the information provided by Mitov in his January 4, 2001
interview. Trial Tr. vol. 1, 55, June 8, 2004. And while
Schultz acknowledged there was no guarantee of success in
the matter, his testimony was explicit in that he believed
Mitov’s demand for payment destroyed the witness’s
credibility, and thus the foundation of the case. The de-
mand, Schultz stated, “significantly diminished” the firm’s
likelihood of success. Id. This diminished probability, and
their resulting discount in fees and expenses created not
just a reasonable fear of economic harm, but actual eco-
nomic harm, sufficient to satisfy the elements of the Hobbs
Act. See United States v. Lewis, 797 F.2d 358, 364 (7th Cir.
1986); United States v. Rindone, 631 F.2d 491, 494 (7th Cir.
1980).
  As to counts two and three, which charged Mitov for the
attempted extortion of Steven Japp in 2002, he argues that
because his prior demand on the law firm had sabotaged the
will challenge, it was impossible for Steven to expect any
form of success in the case, and thus possess the requisite
reasonable fear. Essentially, Mitov claims that the extortion
of Steven Japp was factually impossible. But Mitov was
convicted of attempted extortion, and factual impossibility
is no defense. United States v. Bailey, 227 F.3d 792, 797
(7th Cir. 2000). Further, Steven Japp’s reasonable fear of
economic harm is intertwined with that of his attorney,
Richard Schultz. Because Schultz was Steven’s legal
representative, any fear that Schultz had regarding the
effect of the demand on the case, and thus the economic
benefit from suit or settlement, may be imputed to Steven
himself.
12                                               No. 05-2275

  Mitov further claims that the government failed to
demonstrate that his actions affected interstate commerce.
But the Hobbs Act is imbued with the full reach of Con-
gress’s Commerce Clause power. 18 U.S.C. § 1951(b)(3);
Scheidler v. NOW, Inc., 537 U.S. 393, 408, (2003). There-
fore, the government need only demonstrate a de minimis
affect on commerce. United States v. Re, 401 F.3d 828, 834-
35 (7th Cir. 2005). Or, where there is no actual effect, the
government need prove only “a realistic probability of an
effect . . . on interstate commerce to bring [the extortion]”
within prosecutorial reach. United States v. Peterson, 236
F.3d 848, 852 (7th Cir. 2001) (citing United States v. Bailey,
227 F.3d 792, 797 (7th Cir. 2000)).
  In his attack on count one, the attempted extortion of
Schwartz, Cooper, Mitov argues that the money was
supposed to come from the Japp family, not the firm, and
thus would not have affected interstate commerce. But his
demands for payment were never so specific as to the source
of the funds, and he repeatedly gave short-term deadlines
to raise the money. Had the firm satisfied these demands,
their assets would have been temporarily depleted. Such a
“loss of the use of money constitutes a deprivation of
property under § 1951,” Lewis, 797 F.2d at 365, and,
because the firm regularly purchases items from states
other than Illinois, interstate commerce would have been
effected. Bailey, 227 F.3d at 797-98. The government,
therefore, made the necessary showing as to count one.
  On counts two and three, charging the attempted extor-
tion of Steven Japp, Mitov argues that the demanded
payment was to come from the family, and thus not affect
interstate commerce. The payment from Steven, however,
was to be wired to Mitov’s cousin in Luxembourg; a fact
he admitted at trial. An international transfer of assets
such as is this is sufficient to satisfy the interstate com-
merce requirement of § 1951. See United States v. Kaplan,
171 F.3d 1351, 1355 (11th Cir. 1999). Given these eviden-
No. 05-2275                                                13

tiary showings on the form and probable consequences of
Mitov’s demands for payment, we cannot say that the record
was devoid of evidence from which the jury could find he
attempted to extort Schwartz, Cooper and Steven Japp.

  C. Evidence From the Underlying Civil Suit
  Mitov next claims that the district court erred in limit-
ing his use of evidence from the state court trial. We review
these evidentiary rulings for an abuse of discretion, which
will be found only where no reasonable person would agree
with the decision of the district court. United States v.
Thomas, 453 F.3d 838, 845 (7th Cir. 2006).
  In arguing this point, Mitov generally claims that his
culpability on the attempted extortion charge is “insepara-
ble from the strength of the proof of undue influence” in the
underlying state civil suit. Defendant’s Br. 21. In presenting
this theory at trial, he aimed to introduce Springer’s notes
from the January 4, 2001, meeting, answers to interrogato-
ries verified by Steven Japp, and prior amendments made
to Leonard Japp, Sr.’s trusts. His apparent intention was to
re-try the civil suit in federal court. But the district court
judge was not required to allow this, and to do so would
have been an unjustifiable expense and delay. FED. R. EVID.
102. As noted above, 18 U.S.C. § 1951 does not require that
the victim’s fear be certain, it need only be reasonable.
Further, Mitov was able to appropriately and extensively
cross-examine Schultz on his expectations for the underly-
ing case using the answers to interrogatories and the
substance of Springer’s notes. This line of questioning
brought to light apparent inconsistencies between the two
documents, and thus the reasonableness of Schultz’s fear of
harm. Notwithstanding Mitov’s general citation to FED. R.
EVID. 103, rulings on evidence, he presents nothing to
indicate that no reasonable person would have agreed
with the district court.
14                                              No. 05-2275

  D. The Sentence
  Lastly, Mitov argues that the district court committed
error in finding, by a preponderance of the evidence, that he
obstructed justice. This finding enhanced his Guideline
Range by two levels pursuant to U.S.S.G. § 3C1.1. Mitov
claims that United States v. Booker, 543 U.S. 220 (2005),
held such enhancements must be found beyond a reasonable
doubt. He is mistaken. See United States v. Bryant, 420
F.3d 652, 656 (7th Cir. 2005). Such a burden of proof
is necessary only where the finding yields an imposed
sentence greater than the statutory maximum. Id. Mitov,
however, was sentenced to a term of twenty-four months,
well below the statutory maximum of twenty years. 18
U.S.C. § 1951(a).
  For the abovementioned reasons, the decisions of the
district court and petitioner-appellant’s conviction are
AFFIRMED.

A true Copy:
      Teste:

                        ________________________________
                        Clerk of the United States Court of
                          Appeals for the Seventh Circuit

                   USCA-02-C-0072—8-21-06