965 F.2d 484 (7th Cir. 1992), 91-1515, United States v. Kamel

Docket Nº:91-1515, 91-1516.
Citation:965 F.2d 484
Party Name:UNITED STATES of America, Plaintiff-Appellee, v. Kamel KAMEL and Musa Khabbas, Defendants-Appellants.
Case Date:June 16, 1992
Court:United States Courts of Appeals, Court of Appeals for the Seventh Circuit

Page 484

965 F.2d 484 (7th Cir. 1992)

UNITED STATES of America, Plaintiff-Appellee,


Kamel KAMEL and Musa Khabbas, Defendants-Appellants.

Nos. 91-1515, 91-1516.

United States Court of Appeals, Seventh Circuit

June 16, 1992

        Argued April 8, 1992.

Page 485

        Barry R. Elden, Richard K. Kornfeld (argued), Asst. U.S. Attys., Office of the U.S. Atty., Criminal Receiving, Appellate Div., Chicago, Ill., for U.S.

        Ronald C. Smith (argued), Chicago, Ill., for Musa Khabbas.

        Kenneth L. Cunniff (argued), Chicago, Ill., for Kamel Kamel.

        Before BAUER, Chief Judge, RIPPLE, Circuit Judge, and BURNS, Senior District Judge. [*]

        RIPPLE, Circuit Judge.

        On December 19, 1988, a fire destroyed a food and liquor store located in Chicago, Illinois. Evidence subsequently indicated that the fire was intentionally set. The business was owned and operated by two brothers, Kamel Kamel and Musa Khabbas. In January 1990, Mr. Kamel and Mr. Khabbas were indicted by a federal grand jury on five charges arising out of the fire. A superseding six-count indictment was returned in March 1990. At a jury trial held in the United States District Court for the Northern District of Illinois, the two defendants offered alibis and contended that the fire was started by some other, unknown individual or individuals. Nevertheless, the jury returned a conviction of Mr. Kamel on all six of the charged counts and of Mr. Khabbas on one of the six counts. Following their sentencing, Mr. Kamel made a motion for a new trial, which was denied by the district court. These joint appeals by both defendants followed. For the reasons stated below, we affirm.




        In December 1987, Mr. Kamel signed a lease for premises for the Shaban Food and Liquor Store, located on the ground floor of a brick apartment building at 449 West 81st Street in Chicago. Mr. Kamel was listed on the insurance documents and corporate papers as the owner of the business. Mr. Khabbas contributed some capital to the business, and both he and his brother worked in the store on a regular basis.

        The value of the inventory kept in the store was disputed, but it ranged from approximately $14,000 to $28,000. Initially, Mr. Kamel insured the contents of the store for $40,000. However, on August 16, 1988, at his request, the amount of coverage of this contents insurance was increased to $60,000.

        The store apparently was unprofitable at its 81st Street location. Robert Ellis, an agent for the Internal Revenue Service, testified at trial that in the first six months of 1988, income exceeded expenses in some months, while the reverse was true in other months; he further testified that expenses exceeded income during every month of the second half of 1988. In about August of 1988, Mr. Kamel and Mr. Khabbas began exploring a new location for the business. They finally decided to move to a building located at 8112 South Vincennes Avenue, in Chicago. Negotiations proceeded with the building owner, Samuel Scaife, and, in November 1988, Mr. Kamel signed a lease for this new location, and Mr. Khabbas gave

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Mr. Scaife a check for the first month's rent. The lease was to be effective on December 1, 1988.

        In the weeks before the fire at the Shaban Store, several other events took place. The gas company shut off natural gas service to the store on December 1, 1988, and water service was discontinued shortly thereafter. In the middle of December, Diane Malone, who lived near the store, noticed Mr. Kamel and Mr. Khabbas moving inventory out of the store. And, on December 2, Mr. Kamel contacted his insurance broker to inquire about increasing the insurance on the contents of his store yet again, from $60,000 to $80,000, although this change was never in fact made.


        The fire which destroyed the Shaban Food and Liquor Store started at approximately 10 p.m. on December 19, 1988. A key witness at the subsequent criminal trial was Richard Pitts, a bus driver who lived next to the store. Mr. Pitts testified that he arrived home at about 9:30 p.m. and noticed a grey Mustang, which he recognized as belonging to Mr. Khabbas, parked in front of the store. Mr. Pitts also noticed that the store's lights were on but that the store itself was closed. As he was sitting in his home, he heard a loud explosion, raced to the window and saw flames coming from the store. When he ran out of his house, the grey Mustang was no longer parked in front of the store. A few minutes later, Mr. Pitts saw Mr. Khabbas and identified him to John Hafford, a police officer who had responded to the fire. Mr. Khabbas was interviewed by Officer Hafford; Mr. Khabbas told the police officer that he had closed the store at 9 p.m. and returned home, and returned to the store only after he received a phone call about the fire. Mr. Kamel arrived on the scene at about 10:45 p.m. Officer Hafford then interviewed him as well. Mr. Kamel told the police officer that he too had received a phone call at his home about the fire and had come in response.

        Although there was a burglar alarm in the store, the alarm was not set on the night of December 19. Furthermore, there usually was a security guard who stayed in the store after it was closed at the end of the business day, but he was absent on the night of the fire.

        After the fire was extinguished, City of Chicago fire inspectors and Thomas Peterson, a detective from the Chicago Police Department bomb and arson unit, inspected the building. Their investigation showed that the fire had been deliberately set. They recovered a plastic container, which was determined to contain gasoline residue, as well as debris containing traces of petroleum products. At the trial, one witness suggested that another inflammatory agent might instead have been used to start the fire. The investigators also found that holes had been cut in the floor between the first and second floor of the building, which accelerated the spread of the fire. Later, Robert Schwarz, a fire inspector hired by the insurance company's adjuster, investigated the building. He determined that the fire had been deliberately set by someone who placed some inflammables around the store and then ignited them.


        A few days after the fire, Mr. Kamel called Mr. Scaife to ask him to change the starting date on the lease for the Vincennes Avenue store from December 1, 1988 to January 1, 1989. Mr. Kamel also asked Mr. Scaife to testify, if necessary, that the check given him by Mr. Khabbas was not for rent, but rather for supplies. Mr. Scaife agreed to these requests, and in fact he so testified on October 31, 1989, before a federal grand jury which was investigating the fire. About six weeks later, Mr. Scaife notified the U.S. Attorney's Office that he had lied before the grand jury--including his statement that the lease on the Vincennes Avenue property had not been signed until after the fire--and stated that the lease indeed was effective on December 1, 1988.

        Over the next several months, Mr. Kamel and Mr. Khabbas were interviewed by government officials and private individuals

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who were investigating the fire. In addition to Mr. Scaife's perjury before the grand jury, which was suborned by Mr. Kamel, both defendants themselves gave a number of inconsistent and untruthful answers to these investigators, which statements were offered as evidence at the trial. After the fire, the insurance company employed Patrick Walsh as an insurance adjustor in connection with the fire loss claim. In a taped statement given to Mr. Walsh on December 23, 1988, Mr. Kamel falsely stated that it was his intention that the store would remain at the West 81st Street location. On January 3, 1989, Mr. Kamel was interviewed by Tamra Bilik, a Special Agent for the Bureau of Alcohol, Tobacco and Firearms. At that time, Mr. Kamel falsely told Agent Bilik that Mr. Khabbas did not work at the store, and also told her that he had not signed a lease for a new store location. Finally, on May 3, 1989, Mr. Kamel met with Richard Heytow, an attorney retained by the insurance company to review Mr. Kamel's claim. At that time, Mr. Kamel gave a sworn statement to Mr. Heytow, falsely stating that he had signed the lease on the Vincennes Avenue location only after the fire occurred and that he had only talked with Mr. Scaife once from August 1988, until after the date of the fire.

        Like his brother, Mr. Khabbas also made false statements to Agent Bilik. Particularly, in an interview given on January 4, 1989, he stated that he had left the store at about 9 p.m., and had not returned to West 81st Street until about 10:45 p.m. In fact, he had been interviewed there by Police Officer Hafford, and had been seen there by Mr. Pitts, right after the start of the fire at 10 p.m.


        On January 30, 1990, a grand jury returned a five count indictment, charging Mr. Kamel and Mr. Khabbas with two counts of wire fraud, in violation of 18 U.S.C. § 1343; two counts of mail fraud, in violation of 18 U.S.C. § 1341; and one count of damage to property used in interstate commerce or in an activity affecting interstate commerce, by means of fire or an explosive, in violation of 18 U.S.C. § 844(i). On March 28, 1990, the grand jury returned a superseding, six count indictment, adding a charge of using fire or explosives to commit a felony, in violation of 18 U.S.C. § 844(h), to the original five counts.

        The jury trial began on October 1, 1990. At the conclusion of the government's case, the defendants moved for a judgment of acquittal; the court denied this motion. On October 10, 1990, the jury returned a verdict of guilty on all six counts against Mr. Kamel. The jury acquitted Mr. Khabbas of Counts One...

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