378 F.3d 151 (2nd Cir. 2004), 02-1740, United States v. Chen

Docket Nº:02-1740L, 02-1759CON.
Citation:378 F.3d 151
Party Name:UNITED STATES of America, Appellee, v. Steven CHEN and Gong Chai Sun, Defendants-Appellants.
Case Date:August 05, 2004
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit

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378 F.3d 151 (2nd Cir. 2004)

UNITED STATES of America, Appellee,


Steven CHEN and Gong Chai Sun, Defendants-Appellants.

Nos. 02-1740L, 02-1759CON.

United States Court of Appeals, Second Circuit

August 5, 2004

        Argued: March 30, 2004.

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        Jeremiah Donovan, Old Saybrook, CT, for Defendant-Appellant Steven Chen.

        Michael S. Hillis, Dombroski, Knapsack & Hillis LLC, New Haven, CT, for Defendant-Appellant Gong Chai Sun.

        Stephen B. Reynolds, Assistant United States Attorney, Hartford, CT (Kevin J. O'Connor, United States Attorney, William J. Nardini, on the brief), for Appellee.

        Before: FEINBERG, CABRANES, and POOLER, Circuit Judges.

        FEINBERG, Circuit Judge.

        Defendants-appellants Steven Chen and Gong Chai Sun ran a loansharking operation out of Foxwoods Casino in Mashantucket, Connecticut. Most of their "clients" were Asian gamblers at the casino and Asian business owners with businesses in Manhattan, Queens and New Jersey. In January 2002, a grand jury returned an indictment against Chen and Sun, charging them each with one count of conspiracy to use extortionate means to collect and attempt to collect extensions of credit,1 in violation of 18 U.S.C. § 894(a), and two counts of using extortionate means to collect and attempt to collect extensions of credit, also in violation of § 894(a). In August 2002, a jury convicted Chen on all three counts of the indictment; Sun was convicted on counts one and two, but was acquitted on count three.2 Following the close of the government's case, Chen and Sun moved for acquittal pursuant to Fed.R.Crim.P. 29. After their convictions, they moved again for acquittal or for a new trial pursuant to Fed. R. Crim P. 33. The United States District Court for the District of Connecticut (Janet Bond Arterton, J.), in a September 2003 opinion, denied the motions. Chen and Sun now appeal, each claiming that the evidence at trial was insufficient to support his substantive convictions. Sun also argues that the evidence underlying his conspiracy conviction was insufficient. Finally, Chen claims that the district court abused its discretion in refusing to order the government to produce a bill of particulars more specifically defining each alleged threat made to collect extensions of credit and each alleged act of violence associated with each threat.

        I. Background

        A. The Indictment

        As described above, the indictment handed down against Chen and Sun alleged, as against each, one count of conspiracy to violate 18 U.S.C. § 894(a)(1) and two counts of substantive violations of that statute. Section 894(a)(1) prohibits "the use of any extortionate means ... to collect or attempt to collect any extension of credit." "Extortionate means" are "any

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means which involve[ ] the use, or an express or implicit threat of use, of violence or other criminal means to cause harm to the person, reputation, or property of any person." Id. § 891(7). "To collect an extension of credit means to induce in any way any person to make repayment thereof." Id. § 891(5).

        Count one of the indictment, the conspiracy charge, alleged a conspiracy to use extortionate means to collect and attempt to collect extensions of credit "from Inguan Teoh, Chin Shen Hsu, and other debtors." It alleged that this conspiracy took place between about January 1999 and about December 2001 "in the District of Connecticut and elsewhere." Counts two and three of the indictment, the substantive charges, alleged that the extortionate collection and attempted collection of extensions of credit took place between about July 1999 and February 2001 on count two and between about January 1999 and December 2001 on count three, but that the alleged extensions of credit took place on both counts only "in the District of Connecticut." More specifically, count two alleged that Chen and Sun "together with others unknown to the Grand Jury" used extortionate means to collect extensions of credit from a borrower named Inguan Teoh by "expressly and implicitly threaten[ing] the use of violence and other criminal means to cause harm to" Teoh. Count three similarly alleged that Chen and Sun, along with others, used extortionate means to collect extensions of credit from a borrower by the name of Chin Shen Hsu.

        B. Evidence Adduced at Trial

        1. The loansharking conspiracy (count one)

        During the course of the five-day jury trial, the government presented evidence of Chen and Sun's loansharking scheme to the jury through, among other things, the testimony of FBI agents and Kun Lin, a cooperating witness, tape-recorded conversations between Lin and Chen and Sun, and video tapes of the casino floor at Foxwoods. The evidence generally showed that Chen and Sun operated out of Foxwoods Casino, where they made high interest loans to a primarily Asian clientele. Chen and Sun usually charged their borrowers about 10 percent interest on their loans; the loans usually had to be paid back within three to seven days. They often let borrowers purchase "extensions" on their loans for another 10 percent. Chen and Sun and a few other confederates would also roam the casino, sometimes gambling themselves, but also watching those clients who had borrowed money from them. It seemed to be their general practice that if a borrower won while gambling, his debt would be collected on the spot.

        Chen and Sun's operation was extensive. Chen acknowledged that the business was "exhausting" because it required him to be at the casino almost daily for about two years. Allan Phillips, an expert witness from the FBI's Racketeering Records Analysis Unit, testified that his analysis of Chen and Sun's ledger books revealed that Chen and Sun had provided loans to approximately 138 different borrowers, in the total amount of $396,000. Phillips stated that the annual interest rates on the various loans ranged from zero to 4,055 percent. Chen and Sun also seemed interested in expanding their business. When Chen and Sun met with cooperating witness Lin in November and December of 1999 and then again in July 2000, they encouraged Lin to invest $100,000 in the business so that they could control loansharking at two casinos.

        The evidence also showed that Chen and Sun would use threats in order to ensure

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payments of outstanding loans. Chen bragged to Lin that he and Sun had police officers who collected debts for them, and showed Lin a police badge to prove his connections. Chen claimed that when the owner of a Malaysian restaurant did not pay him a debt, Chen sent the police to beat him up. Chen also claimed that he had the restaurant shut down. In addition, Sun admitted to FBI agents after his arrest that he and his confederates would verbally threaten borrowers who had not paid back their loans. He indicated that one of the members of his loansharking group, Ah-Qiang, "would use very deliberate body language to compel people to pay back their loans."

        2. The substantive count involving Inguan Teoh (count two)

        Both victims named in the indictment--Inguan Teoh and Chin Shen Hsu--testified at trial. Inguan Teoh was a Malaysian business man who met Steven Chen through a mutual friend. Teoh owned two restaurants--the Melaka Restaurant in Flushing, Queens and another in New Jersey. Teoh testified that in about July 1999, his restaurant was running at a loss. Because he could not obtain a loan from a bank, Teoh decided to travel to Foxwoods to approach Chen for a loan. Teoh asked Chen for a $10,000 loan, but Chen consented to lend him only $5,000. Chen told Teoh that the interest on the loan would be 10 percent, or $500, per week. Chen took the first week's interest out of the loan, giving Teoh $4,500. Additionally, Chen explained that if Teoh wanted an extension on the loan, he could pay another $500 for every week of extension. At the time Chen gave Teoh the loan, Chen warned Teoh that if he did not pay back the money, Chen would "find ways and means to look for [him] in order to get the money." Chen also told Teoh that he should not run away with the money because he had "about 60 people" under him who would search out Teoh to get him to pay. Chen said that he had "police personnel" working for him who helped him collect loans. Teoh understood that if he did not pay back the loan, he could get "beaten up."

        Teoh paid back the loan and then proceeded to take out three more loans from Chen. The second loan was in the amount of $10,000, with the same 10 percent interest per week and extension arrangement as the first loan. Teoh, who was in New York, called Chen at Foxwoods to get the loan. As with the first loan, Chen told Teoh over the phone that he had to pay back the loan and could not hide from Chen and his people. About one or two days later, defendant-appellant Sun delivered the money to Teoh in Flushing. Teoh paid back the second loan, and about two weeks later took out a third loan for $10,000 under the same terms as the second loan. Once again, Teoh called Chen at Foxwoods, and Chen had the money delivered to Teoh in...

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