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United States v. Tkhilaishvili

United States Court of Appeals, First Circuit

June 5, 2019

UNITED STATES OF AMERICA, Appellee,
v.
JAMBULAT TKHILAISHVILI, Defendant, Appellant. UNITED STATES OF AMERICA, Appellee,
v.
DAVID TKHILAISHVILI, Defendant, Appellant.

          APPEALS FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS [Hon. Douglas P. Woodlock, U.S. District Judge]

          Michael Tumposky, with whom Hedges & Tumposky, LLP was on brief, for appellant Jambulat Tkhilaishvili.

          William W. Fick, with whom Fick & Marx LLP was on brief, for appellant David Tkhilaishvili.

          Alexia R. De Vincentis, Assistant United States Attorney, with whom Andrew E. Lelling, United States Attorney, was on brief, for appellee.

          Before Howard, Chief Judge, Torruella and Selya, Circuit Judges.

          SELYA, CIRCUIT JUDGE.

         Victor Torosyan, together with defendants-appellants Jambulat Tkhilaishvili and David Tkhilaishvili, planned to open a suboxone clinic (the Clinic) for the treatment of opioid addiction. The defendants had represented to Torosyan that they would provide the know-how as long as he furnished the bulk of the necessary financing. But while Torosyan was depleting his resources in order to get the Clinic up and running, the Tkhilaishvili brothers attempted to relieve him of some portion of his share in the business through extortionate means. Torosyan blew the whistle and, after a week-long trial, a jury convicted the defendants of conspiring to commit Hobbs Act extortion and other crimes. The defendants appeal. After careful consideration, we reverse the judgment of conviction on an embezzlement count brought against David; otherwise, we find the defendants' manifold claims of error either lacking in merit or waived (or in some instances both) and, therefore, affirm the remaining judgments of conviction. Finally, we remand to the district court for further consideration of David's sentence and the concomitant restitution order in light of the reversed conviction.

         I. BACKGROUND

         We start by rehearsing the relevant facts, taking them in the light most hospitable to the verdict, consistent with record support. See United States v. DiDonna, 866 F.3d 40, 43 (1st Cir. 2017). We then recount the travel of the case.

         In 2014, David approached Torosyan about opening a suboxone clinic in Quincy, Massachusetts. David boasted that he and his brother Jambulat had experience running a suboxone clinic but needed a significant capital infusion to get the project off the ground. Torosyan, who had known David socially, agreed to invest $500, 000 in the project.

         In December of 2014, the parties entered into a letter agreement establishing the structure of the business and the membership interests of each principal. Under the letter agreement, the venture consisted of two Massachusetts limited liability companies: Allied Health Clinic (AHC) and Health Management Group (HMG). Torosyan received a 41% Class A share in both AHC and HMG; David received a 40% Class A share in HMG and a 4% Class B share in AHC; and Jambulat received a 45% Class A share in AHC and a 5% Class B share in HMG. The remaining Class B interests in AHC and HMG were reserved for other anticipated employees of the proposed suboxone clinic, all of whom were relatives or former associates of the defendants.

         Given Torosyan's role as the primary (indeed, the sole) investor, the letter agreement granted him a special consent authority, which entitled him to decide any contested matters involving the Clinic until his capital investment had been fully recouped. It also granted him a secured guarantee of 50% of his investment, collateralized by the Tkhilaishvilis' pizza parlor.

         With the letter agreement in place, the trio moved forward with their plans to open the Clinic. From Torosyan's perspective, things did not go smoothly. In the Spring of 2015, he learned that the defendants had hoodwinked him about the progress of construction. He also learned of prior violent behavior by the defendants. It was not until August 6, 2015 - months later than anticipated - that the Clinic finally received a certificate of occupancy from the City of Quincy. By then, Torosyan had infused approximately $400, 000 of his personal savings into the Clinic.

         Matters went downhill from there. On August 22, the defendants asked Torosyan to release his security interest in the pizza parlor so that they could sell that business and focus on the Clinic. Torosyan agreed, but as soon as he had signed the release, the defendants started to threaten him. They demanded that he surrender his special consent authority and relinquish a portion of his ownership interest. They warned that if he refused to comply, they would "burn down the Clinic" and that he and his family were "going to be hurt."

         The next day, Torosyan suggested to David that they mediate the dispute in accordance with the letter agreement. David replied that he would "put a bullet in [the mediator's] head" and said that his brother "shot . . . people in the head." Torosyan was "very, very scared."

         Although shaken by this dramatic shift in the defendants' attitude, Torosyan nonetheless decided to move forward with the Clinic. In September, lawyers for Torosyan and the defendants negotiated and drafted formal operating agreements. Except for minor adjustments to the distribution of membership interests, the operating agreements retained most features of the letter agreement (including Torosyan's special consent authority). In addition, the operating agreements included new "duty of loyalty" provisions, which had the potential to trigger forfeiture of any breaching member's ownership interest.

         Torosyan and those persons holding minor membership interests signed the operating agreements on September 11. Jambulat signed the following day, after declaring that "contracts mean[t] nothing" to him. He also demanded that Torosyan immediately give 5% of Torosyan's ownership interest to a creditor of the defendants and agree to give 40% of the Clinic's profits to David when the Clinic began receiving reimbursements from insurance companies. Torosyan deflected these demands, saying that he would speak to his lawyer. David, who was traveling, signed the operating agreements sometime within the next few days.

         The Clinic opened in October of 2015, after receiving a license from state public health authorities. Around that time, Torosyan loaned David $3, 000, with the understanding that the money would serve as David's salary for November unless repaid within one week. David never repaid the loan but nonetheless withdrew salary payments for November totaling $3, 500.

         On November 9, David requested that Torosyan meet him at the Clinic. When Torosyan arrived, the defendants asked to speak privately with him in an exam room. Once inside, they locked the door and demanded that he turn over 40% of available Clinic funds to them and cede 5% of his ownership interest to their friend. In Torosyan's presence, David suggested to Jambulat that they needed to "get rid of" him. The threats continued as Torosyan retreated to the parking lot, where Torosyan saw Jambulat withdraw a knife from the glove compartment of David's car.

         By then, Torosyan had sunk roughly $580, 000 into the Clinic. He reported the threats to his attorneys and thereafter met with agents of the Federal Bureau of Investigation (FBI). At the FBI's behest, he agreed to wear a wire and surreptitiously record conversations with the defendants. In recordings made on November 25 and 30, David made several incriminating statements, reiterating earlier threats, referring to previous violent acts undertaken by both defendants, and suggesting that he had connections with members of Russian organized crime.

         On January 6, 2016, Torosyan sought to exorcise the defendants: he invoked the "duty of loyalty" provision to remove them from Clinic membership. Shortly thereafter, a federal grand jury sitting in the District of Massachusetts charged both defendants with conspiring and attempting to commit Hobbs Act extortion (counts 1 and 2). See 18 U.S.C. § 1951. In addition, David was charged with embezzlement from a health care benefit program (counts 3 and 4). See id. § 669.

         Both defendants maintained their innocence and, in advance of trial, moved to exclude evidence of prior violent acts. See Fed.R.Evid. 404(b). At a pretrial hearing, the district court ruled such evidence admissible "to the degree that the witness has expressed a concern or is aware of prior acts of violence by the defendants." A week-long jury trial ensued, and the defendants timely moved for judgment of acquittal. See Fed. R. Crim. P. 29(a). The district court reserved decision, see Fed. R. Crim. P. 29(b), and sent the case to the jury, which found the defendants guilty on all counts.

         A consolidated sentencing proceeding was conducted on two separate days. During that hearing, the district court denied the defendants' motions for judgment of acquittal (including a supplemental motion filed by David over the government's objection on the eve of the first day). The court proceeded to sentence David to four concurrent 36-month terms of immurement followed by a three-year term of supervised release; ordered him to pay a special assessment of $400 ($100 per count), see 18 U.S.C. § 3013; and decreed that he make restitution in the amount of $3, 500. The court sentenced Jambulat to two consecutive nine-month terms of immurement followed by a three-year term of supervised release, and ordered him to pay a special assessment of $200. These timely appeals ensued.

         II. HOBBS ACT EXTORTION

         The defendants challenge on three fronts their convictions for conspiring and attempting to commit Hobbs Act extortion (counts 1 and 2). We deal sequentially with these challenges.

         A. Sufficiency ...


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