United States v. Vahan Kelerchian

In the

United States Court of Appeals

For the Seventh Circuit

____________________

No. 18-1320

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v.

VAHAN KELERCHIAN,

Defendant-Appellant.

____________________

Appeal from the United States District Court for the

Northern District of Indiana, Hammond Division.

No. 2:13-CR-66 — Joseph S. Van Bokkelen, Judge.

____________________

ARGUED APRIL 2, 2019 — DECIDED AUGUST 22, 2019

____________________

Before HAMILTON, BARRETT, and SCUDDER, Circuit Judges.

HAMILTON, Circuit Judge. Federal law imposes tight re-

strictions on private possession of machineguns and laser

gunsights but allows law enforcement agencies to purchase

and use both machineguns and laser sights. This appeal con-

cerns criminal conspiracies among a firearms dealer and law

enforcement officers to fool manufacturers into thinking they

were selling to local police forces when the machineguns and

laser sights were instead going into private hands.

2 No. 18-1320

Defendant-appellant Vahan Kelerchian was a licensed

firearms dealer. His co-conspirators were Joseph Kumstar, the

Deputy Chief of the Lake County Sheriff’s Department in In-

diana, and Ronald Slusser, a patrolman who was the armorer

for the department’s SWAT team. The trio defrauded firearms

manufacturer Heckler & Koch and the laser sight producer

Insight Technologies into selling them machineguns and laser

sights restricted by law for law enforcement and military use.

After many fraudulent transactions, the three were indicted

on several charges. Kumstar and Slusser pleaded guilty.

Kelerchian went to trial and was convicted on four counts of

conspiracy and four counts of making false writings. On ap-

peal, Kelerchian raises numerous issues, but we affirm his

convictions on all counts. In Parts I and II, we provide the fac-

tual and procedural background for Kelerchian’s arguments.

In Part III, we analyze his numerous challenges to his convic-

tions.

I. Factual Background

A. Machineguns and Laser Sights

Since enactment of the National Firearms Act of 1934, cod-

ified in the Internal Revenue Code as 26 U.S.C. § 5801 et seq.

(“the 1934 Act”), federal law has forbidden the importation of

machineguns, but with several exceptions. Two are relevant

here. First, machineguns may be imported for use by state or

federal departments or agencies, and second, machineguns

may be imported “solely for use as a sample by a registered

importer or registered dealer.” 26 U.S.C. § 5844; see also 27

C.F.R. § 479.112. The conspirators here submitted fake docu-

ments to Heckler & Koch to take advantage of these two ex-

ceptions.

No. 18-1320 3

The Gun Control Act of 1968, as amended and codified as

part of the criminal code in 18 U.S.C. § 921 et seq. (“the 1968

Act”), imposed additional restrictions on a much broader cat-

egory of firearms, as well as new recordkeeping laws. The

1968 Act, as amended, prohibits the transfer or possession of

machineguns made after 1986, except by a federal, state, or

local agency. 18 U.S.C. § 922(o). Both the 1968 and 1934 Acts

require importers and dealers of firearms to keep records re-

lated to their transactions. 18 U.S.C. § 923(g); 26 U.S.C. § 5843.

Both Acts make it a crime to make false statements with re-

spect to these records. 18 U.S.C. § 924(a)(1)(A); 26 U.S.C.

§ 5861(l). The Bureau of Alcohol, Tobacco, Firearms and Ex-

plosives (“ATF”) administers the recordkeeping requirements

and the exceptions.

Laser sights, on the other hand, are regulated by the Food

and Drug Administration (“FDA”) as part of its regulation of

radiation-emitting devices. See 21 U.S.C. § 360ii. The power-

ful lasers on gunsights can cause eye damage, so federal law

ordinarily requires them to be equipped with visible or audi-

ble warnings before and during use, as well as protective co-

vers and key controls. 21 C.F.R. § 1040.10(f). They also must

have labels warning of the risk of eye damage. 21 C.F.R.

§ 1040.10(g)(2)(iii).

The FDA may, however, grant exemptions or variances

from these requirements, such as for police departments that

might need to be able to use silent laser sights. 21 U.S.C.

§ 360oo(b); 21 C.F.R. § 1010.4(a). The FDA also requires accu-

rate records for laser sales. Laser manufacturers must collect

and preserve information that will enable the tracing of lasers

sold to distributors or to dealers. 21 C.F.R. § 1002.30(b)(1); see

also 21 U.S.C. § 360nn(f). Dealers and distributors must

4 No. 18-1320

“obtain such information as is necessary to identify and locate

first purchasers” of lasers and forward this information “im-

mediately to the appropriate manufacturer.” 21 C.F.R.

§ 1002.40(a), (c).

B. The Conspiracies

Vahan Kelerchian was a licensed firearms dealer who ran

a business in Pennsylvania called Armament Services Interna-

tional, Inc., known as ASI. He met Lake County Sheriff patrol-

man Ronald Slusser at a Kentucky machinegun show some

time in the early 2000s. A few years later at the same show,

Slusser introduced Kelerchian to his supervisor, Joseph Kum-

star, the Deputy Chief of the Lake County Sheriff’s Depart-

ment. According to Slusser, he and Kelerchian stayed in touch

and did business together for the next several years.

At some point, Slusser told Kelerchian about an illegal

arms deal in 2008 that Kumstar had instructed him to help

with. Kumstar had acquired machineguns by claiming that

they were for the Sheriff’s Department, but then instructed

Slusser to remove certain parts of these guns and to sell them

over the internet for Kumstar’s personal gain. Slusser testified

that Kelerchian expressed interest in doing a similar deal with

Kumstar and Slusser. The three then plotted the conspiracies

that led to their convictions.

1. Machinegun Purchases

The first part of the conspirators’ plan was to purchase ma-

chineguns from international gun importer Heckler & Koch

(“H&K”) under the pretense that the weapons were for the

Lake County Sheriff’s Department. Kelerchian, Slusser, and

Kumstar orchestrated three fraudulent machinegun pur-

chases from H&K.

No. 18-1320 5

In the first transaction, in December 2008, Kelerchian,

Kumstar, Slusser, and Slusser’s cousin, Ed Kabella, ordered

50 machineguns for $83,026. Kumstar prepared paperwork

saying falsely that the Sheriff’s Department was purchasing

all 50 machineguns. Kelerchian sent this paperwork to H&K,

including statements on Sheriff’s Department letterhead at-

testing that the weapons were for the exclusive use of Lake

County law enforcement. H&K then filed ATF Form 6, assert-

ing that it was importing 50 machineguns for the Lake County

Sheriff’s Department. ATF approved the transaction, and

H&K sent the 50 machineguns to the Sheriff’s Department.

Slusser then took the machineguns apart, separating the

guns’ lower receivers, which are the regulated portions of the

weapons containing traceable serial numbers. The unregu-

lated upper barrels of the guns were distributed among the

conspirators according to how much money each had contrib-

uted to the purchase. The plan was to refurbish 15 of the reg-

ulated lower receivers into new guns using cheaper parts, and

then to add these new weapons into the Sheriff’s Depart-

ment’s armory. The 35 remaining lower receivers were to be

destroyed. No machineguns ever made it to the Sheriff’s De-

partment, though. The conspirators sold the unregulated ma-

chinegun parts for a substantial profit. Slusser sold his unreg-

ulated machinegun barrels to a dealer named Adam Webber,

who runs a website selling hard-to-acquire H&K machinegun

parts.

Webber was involved in the next two machinegun pur-

chases. He told Kumstar and Kelerchian that he was inter-

ested in buying additional machinegun parts. In February

2009, using the same procedure as before, Kumstar and Keler-

chian bought nine H&K machineguns, again telling H&K

6 No. 18-1320

falsely that the guns were for the Sheriff’s Department. Once

the machineguns were delivered, Slusser again disassembled

them and sent the unregulated parts to Webber. In exchange,

and relevant to the money-laundering conspiracy charge,

Webber sent Slusser a cashier’s check for $18,900. At Kum-

star’s direction, Slusser deposited that check into his own ac-

count and then sent cashier’s checks to both Kumstar and

Kelerchian. Nine months later, Kelerchian mailed H&K a

check for the machineguns.

In October 2009, Kelerchian and Kumstar bought twelve

more machineguns from H&K, again telling H&K falsely that

they were for the Sheriff’s Department. Slusser again disas-

sembled the guns and sent the unregulated parts to Webber.

Webber mailed Slusser a $31,200 check, which he cashed.

Slusser wrote Kelerchian a check for $28,200, and Kelerchian

wrote H&K a check for the guns’ $16,800 purchase price.

2. Demonstration Letters

In the meantime, the conspirators also used the exception

for importing machineguns as demonstration samples for a

dealer. Kumstar testified that Kelerchian asked him for help

in buying machineguns for his personal collection. Between

October 2007 and March 2010, Kumstar sent five letters to the

ATF stating falsely that the Lake County Sheriff’s Department

was interested in demonstrations of the weapons Kelerchian

wanted for himself. The letters said that Kelerchian had “of-

fered to conduct such demonstration[s]” and “intend[ed] to

demonstrate the operation, identification and safe handling of

the guns” to provide “department personnel a better under-

standing of the capabilities, limitations and differences of

these guns.” Kumstar testified that neither he nor the Sheriff’s

Department was actually interested in demonstrations of the

No. 18-1320 7

requested machineguns and that he never had discussed a

plan for conducting an actual demonstration with Kelerchian.

Kumstar also testified that the weapons were not guns the De-

partment would use.

Through this arrangement, Kelerchian was able to buy

nine machineguns. He became the registered owner of these

weapons, and federal law allowed him to sell them at his own

discretion. No demonstrations ever occurred.

Kelerchian’s testimony disputed Kumstar’s account. He

said that Kumstar had offered on his own to write the first

dealer sales sample letter for Kelerchian and genuinely was

interested in a demonstration. Kelerchian also testified that he

offered to conduct demonstrations for Kumstar and the De-

partment many times between October 2008 and April 2011.

He said that he offered a variety of settings and dates but that

Kumstar never took him up on his offers. The most Kumstar

did, according to Kelerchian, was to come to Kelerchian’s

place of business, take photographs with guns, and pick up a

gun, saying “We did our demo.”

3. Laser Sight Purchases

Kelerchian, Kumstar, and Slusser also devised a plan to

buy restricted laser sights from a company called Insight

Technology. Slusser testified that he and Kelerchian wanted

to buy laser sights for their personal collections. The devices

Kelerchian and Slusser wanted did not comply with FDA

safety rules requiring a visible or audible warning. However,

the FDA had granted Insight Technology a variance allowing

it to sell its laser sights (technically, Class IIIb devices) to fed-

eral, state, and local enforcement agencies on the theory that

safety features like a visible or audible warning could

8 No. 18-1320

compromise stealth operations in which officers need to re-

main unheard and unseen.

Slusser and Kelerchian used the variance to buy laser

sights on the pretext that they were for the Sheriff’s Depart-

ment. Kelerchian and Slusser told Kumstar which sights they

wanted, and Kumstar then put together a purchase order with

paperwork saying falsely that the Sheriff’s Department was

buying the lasers. In December 2008, Kelerchian sent Insight

Technology this purchase order for 25 sights for $27,103.52.

Using a nearly identical method, in March 2010, the three

bought an additional 22 lasers sights for $30,249.92. Accord-

ing to Slusser, he and Kelerchian placed two more orders for

Insight Technology laser sights by using a friend of Slusser’s

in the Lowell, Indiana Police Department in December 2009

and August 2010. The Lowell orders were for more than 28

Class IIIb laser products costing more than $32,000.

Kelerchian testified that he was unaware of the FDA’s reg-

ulation of lasers and the variance. He told the jury that an In-

sight Technology employee named Linda Harms told him

that the lasers could be sold to individuals if they went

through a law enforcement department first. Harms testified

at trial that she never would have told a customer that laser

sights were available for individual purchase.

II. Procedural Background

A federal grand jury returned a nine-count indictment.

Count I alleged that, in buying the machineguns, Kelerchian,

Kumstar, and Slusser violated 18 U.S.C. § 371 by conspiring

to make false statements in records required by the 1968 Act.

See 18 U.S.C. § 924(a)(1)(A). Count II alleged that, in buying

the laser sights, Kelerchian and the others violated 18 U.S.C.

No. 18-1320 9

§ 371 by conspiring to defraud the FDA by interfering with its

lawful government functions of limiting the sale of various

restricted laser sights to military and law enforcement agen-

cies and correctly identifying the buyers of restricted laser

sights.

Counts III through VII focused on the demonstration let-

ters. Count III charged Kelerchian under 18 U.S.C. § 371 with

conspiring with Kumstar and others to violate 18 U.S.C.

§ 1001 by making false statements to the ATF in the phony

demonstration letters. Counts IV through VII charged Keler-

chian with actual violations of § 1001 in four separate letters.

Count VIII alleged that Kelerchian committed bribery by

offering Kumstar a shotgun in exchange for his help with sev-

eral of the fraudulent transactions. Count IX alleged that

Kelerchian, Kumstar, and Slusser conspired to launder

money in violation of both 18 U.S.C. § 1956 and § 1957. The

§ 1956 allegation concerned the second machinegun purchase

and the § 1957 allegation concerned the third. The premise of

Count IX is that the conspirators engaged in wire fraud in ob-

taining the machineguns and then laundered the proceeds of

that fraud.

Slusser, Kumstar, and Kabella pleaded guilty and agreed

to testify for the prosecution. Kelerchian took his case to trial.

After the government rested and again after the close of all

the evidence, Kelerchian moved under Federal Rule of Crim-

inal Procedure 29 for a judgment of acquittal on all counts. At

both stages, the district court denied the motion on Counts I

through VII and took the motion under advisement on

Counts VIII and IX.

10 No. 18-1320

The jury found Kelerchian guilty on all counts except the

bribery charge in Count VIII. Through a special verdict form,

regarding Count II, the jury specifically found Kelerchian

guilty of conspiring to interfere with both of the two regula-

tory functions of the FDA identified in the indictment.

Through another special verdict form on Count IX, the jury

found Kelerchian guilty of conspiring to launder money in vi-

olation of both 18 U.S.C. § 1956 and § 1957. Kelerchian was

sentenced to 100 months in prison, plus a fine and term of su-

pervised release.

III. Legal Analysis

Kelerchian challenges all of his convictions on a variety of

grounds. First, he argues that Counts I and II failed to allege

federal crimes. Second, he argues the government failed to

prove the demonstration-letter charges in Counts III through

VII and the money-laundering conspiracy in Count IX. Third,

he contends the district court erred in its jury instructions. Fi-

nally, he claims the prosecution engaged in misconduct in its

closing argument. We find no errors.

A. Legal Sufficiency of Counts I and II

1. Count I—Conspiracy to Violate Gun Control Act Re-

cording Requirements

Kelerchian argues that Counts I and II of the indictment

fail to allege federal offenses. We start with Count I, which

charged Kelerchian under 18 U.S.C. § 371 with conspiring to

violate 18 U.S.C. § 924(a)(1)(A), which makes it a crime to

knowingly make “any false statement or representation with

respect to the information required by this chapter to be kept

in the records of a person licensed under this chapter,” includ-

ing federally licensed firearms importers, manufacturers, and

No. 18-1320 11

dealers, including H&K. See Abramski v. United States, 573 U.S.

169, 174–75 (2014). “This chapter” is chapter 44 of Title 18, and

it provides in relevant part that licensees may not sell “any

firearm … to any person unless the licensee notes in his rec-

ords, required to be kept pursuant to section 923 of this chap-

ter, the name, age, and place of residence of such person … or

the identity … of such … corporation or other business en-

tity.” 18 U.S.C. § 922(b)(5). “Person” in this case means the

real buyer or intended recipient of the firearm, not a nominal

or straw purchaser. Abramski, 573 U.S. at 179–82. Regulations

implementing the 1968 Act also require licensees like H&K to

“maintain permanent records of the importation … of fire-

arms, including ATF Forms 6 and 6A.” 27 C.F.R. § 478.129(d).

Count I thus alleged a conspiracy to violate § 924(a)(1) by

leading H&K to create false records for the machinegun pur-

chases—falsely identifying the Lake County Sheriff’s Depart-

ment as the buyer. On this logic, Count I alleged a federal of-

fense.

To avoid this conclusion, Kelerchian argues that 18 U.S.C.

§ 924(a)(1)(A) and the 1968 Act’s regulations in 27 C.F.R. § 478

do not apply generally to machineguns. He argues that the

1934 Act regulates purchase, possession, importation, regis-

tration, and recordkeeping for machineguns, and that the

only provision of the 1968 Act that applies to machineguns is

18 U.S.C. § 922(o), which criminalizes the transfer and posses-

sion of machineguns, but which was not charged in Count I.

Kelerchian bases his statutory argument on the two Acts’

different definitions of the term “firearm.” The 1934 Act pro-

vides: “The term ‘firearm’ means” a number of categories of

especially dangerous weapons, including short-barreled shot-

guns and rifles, and specifically including “a machinegun.” 26

12 No. 18-1320

U.S.C. § 5845(a). By contrast, the 1968 Act defines a “firearm”

in relevant part much more broadly as “any weapon … which

will or is designed to or may readily be converted to expel a

projectile by the action of an explosive.” 18 U.S.C. § 921(a)(3).

Comparing these definitions, Kelerchian argues that because

the 1968 Act’s definition does not expressly include ma-

chineguns, unlike the 1934 Act’s definition, Congress meant

to distinguish between machineguns and firearms in the 1968

Act, leaving machinegun regulation largely to the 1934 Act.

Based on both the text and the structure of the 1968 Act,

we reject this argument. First, a machinegun clearly fits into

the 1968 Act’s broad definition of a “firearm” as a weapon that

“will or is designed to or may readily be converted to expel a

projectile by the action of an explosive.” 18 U.S.C. § 921(a)(3).

Machineguns are a subset of “firearms” as defined in the 1968

Act.1

Second, other provisions of the 1968 Act show that ma-

chineguns are properly treated as a subset of firearms under

that Act. For example, § 924(c)(1) punishes the possession of a

firearm during the commission of a crime of violence or a

drug trafficking offense, but § 924(c)(1)(B)(ii) enhances the

1 In the 1934 Act, the term “‘machinegun’ means any weapon which

shoots, is designed to shoot, or can be readily restored to shoot, automat-

ically more than one shot, without manual reloading, by a single function

of the trigger. The term shall also include the frame or receiver of any such

weapon, any part designed and intended solely and exclusively, or com-

bination of parts designed and intended, for use in converting a weapon

into a machinegun, and any combination of parts from which a ma-

chinegun can be assembled if such parts are in the possession or under the

control of a person.” 26 U.S.C. § 5845(b). The 1968 Act borrows the same

definition for the term where it is used in the 1968 Act. 18 U.S.C.

§ 921(a)(23).

No. 18-1320 13

punishment “if the firearm possessed … is a machinegun.”

Similarly, § 924(c)(1)(C)(ii) imposes a more severe penalty for

a second § 924(c) conviction “if the firearm involved is a ma-

chinegun.” Section 925(d) provides the Attorney General with

authority over importation of firearms into the United States

and possession of “unserviceable firearm[s], other than … ma-

chinegun[s].” 18 U.S.C. § 925(d) (emphasis added). The 1968

Act also grants qualified law enforcement officers with the

proper identification the ability to carry concealed firearms,

but specifically excludes machineguns from the definition of

firearm for purposes of just that section. 18 U.S.C. § 926B(e).

The clear implication is that all other provisions of the Act

without such a limit apply to machineguns as a subset of fire-

arms.

Accordingly, a machinegun counts as a firearm for pur-

poses of 18 U.S.C. § 924, so Count I properly charged Keler-

chian with conspiracy to violate the 1968 Act by submitting

documents falsely telling H&K that the buyer of all the ma-

chineguns would be the Lake County Sheriff’s Department.

2. Count II—Conspiracy to Defraud the FDA

Section 371 of Title 18 of the United States Code makes it

a crime not only to conspire to commit “any offense against

the United States,” but also to conspire “to defraud the United

States, or any agency thereof in any manner or for any pur-

pose.” The Supreme Court has “stated repeatedly that the

fraud covered by the statute reaches any conspiracy for the

purpose of impairing, obstructing or defeating the lawful

function of any department of Government.” Tanner v. United

States, 483 U.S. 107, 128 (1987) (internal quotation marks omit-

ted) (collecting cases). Count II charged Kelerchian with vio-

lating § 371 by conspiring to defraud the FDA in carrying out

14 No. 18-1320

its regulatory responsibilities. Kelerchian argues that Count II

charged him with violating only FDA policy as opposed to any

statute or regulation with the force of law. He emphasizes the

text of the indictment charging him with conspiring to de-

fraud the FDA by interfering with and obstructing the lawful

functions of the FDA to:

a. Limit the sale of various restricted laser aim-

ing sight devices to the military and law en-

forcement agencies only;

b. Correctly identify first line purchasers of

various laser aiming sight devices which

were restricted to military or law enforce-

ment agency purchasers only.

As Kelerchian sees the case, no law or regulation restricts

laser device sales to law enforcement, so he was charged with

conspiring to violate only the variance the FDA granted In-

sight Technology to sell otherwise-illegal laser sights to law

enforcement. Because this variance, Kelerchian continues,

was not adopted in accordance with the Administrative Pro-

cedure Act, it has no force of law and cannot be used to bind

third parties or to support criminal charges against them.

The argument misreads the indictment. Count II did not

charge Kelerchian with conspiring to violate the variance but

with conspiring to defraud the FDA, rendering his Adminis-

trative Procedure Act argument irrelevant. Section 371 makes

it a crime to defraud an agency of the United States “in any

manner or for any purpose.” The indictment alleged that

Kelerchian, Kumstar, and Slusser conspired to defraud the

FDA by obstructing the agency’s ability to perform the two

listed regulatory functions. Federal law provides the FDA

No. 18-1320 15

with the authority to regulate the sale of laser devices. See 21

U.S.C. § 360ii. In carrying out its regulatory function, the FDA

promulgated safety and performance standards for laser

sights. 21 C.F.R. § 1040.10. Manufacturers are barred from

selling products that do not comply with the standards the

agency sets. 21 U.S.C. § 360oo(a). That prohibition is in place

unless a valid variance applies to a sale. § 360oo(b).

The variance is not a regulation, but as the indictment rec-

ognizes, granting these variances is an exercise of the FDA’s

regulatory function over laser products. By deceiving Insight

Technology into selling them non-compliant laser sights,

Kelerchian and the other conspirators defrauded the FDA

into allowing them to possess devices that federal law prohib-

its. They also led Insight to create a false paper trail for these

devices that would make it impossible for the FDA to keep

track of the true owners of these dangerous products, which

the FDA is supposed to do. Such fraud impairs the ability of

the FDA to regulate laser devices to prevent harm to the pub-

lic.

In United States v. F.J. Vollmer & Co., 1 F.3d 1511 (7th Cir.

1993), we rejected an argument similar to Kelerchian’s. At is-

sue in F.J. Vollmer was a settlement agreement reached be-

tween the ATF and Gun South, Inc., a firearms importer. The

settlement agreement allowed Gun South to sell an otherwise-

banned semi-automatic rifle only to law enforcement officers

or agencies. Id. at 1514. Kenneth Nevius, a captain on active

duty in the Illinois National Guard, took advantage of this ex-

ception and bought two restricted rifles using his National

Guard stationery. He said he was buying the weapons “in

connection with his official duties and not for the purpose of

resale.” Id. He lied. He actually bought the guns to sell them

16 No. 18-1320

to F.J. Vollmer & Company, a firearms dealer. Nevius orches-

trated several such deals. Nevius and F.J. Vollmer were in-

dicted. The company was convicted of mail fraud and con-

spiracy to defraud the United States government.

On appeal, the company argued that it was charged with

conspiring to violate only the settlement agreement between

the ATF and Gun South, which was being treated as if it were

a “de facto substantive agency rule.” Id. at 1516. We rejected

the argument, explaining that “F.J. Vollmer and Nevius were

not convicted of violating a settlement agreement.” Id. at 1515.

“The indictment … specifically stated the elements” of a § 371

conspiracy, making it evident to the court that this was the

federal crime the defendants were charged with committing.

Id. at 151516. “Further,” we continued, “because the convic-

tions are not based on the violation of the settlement agree-

ment, the defendants’ [APA] argument … is irrelevant.” Id. at

1516. We apply the same reasoning here. Count II properly

charged Kelerchian with a violation of 18 U.S.C. § 371.

B. Sufficiency of Evidence

Kelerchian next argues that the government failed to

prove the charges involving the so-called demonstration let-

ters that enabled Kelerchian to buy machineguns for his per-

sonal collection (Counts III through VII) and failed to prove

the money-laundering conspiracy charge (Count IX). On its

own initiative or upon a defendant’s motion, a trial court

“must enter a judgment of acquittal of any offense for which

the evidence is insufficient to sustain a conviction.” Fed. R.

Crim. P. 29 (a).

We review de novo the denial of a defendant’s motion for

acquittal, considering the evidence in the light most favorable

No. 18-1320 17

to the prosecution. United States v. Mohamed, 759 F.3d 798, 803

(7th Cir. 2014). We “ask whether any rational trier of fact

could have found the essential elements of a crime beyond a

reasonable doubt,” United States v. Foley, 740 F.3d 1079, 1083

(7th Cir. 2014) (internal quotation marks omitted), and “over-

turn a verdict only when the record contains no evidence, re-

gardless of how it is weighed, from which the jury could find

guilt beyond a reasonable doubt.” United States v. Blassingame,

197 F.3d 271, 284 (7th Cir. 1999) (internal quotation marks

omitted). This is usually a high hurdle for a defendant to clear,

but “the height of the hurdle depends directly on the strength

of the government’s evidence.” United States v. Garcia, 919

F.3d 489, 496–97 (7th Cir. 2019) (reversing denial of Rule 29

motion), quoting United States v. Jones, 713 F.3d 336, 339 (7th

Cir. 2013) (affirming grant of Rule 29 motion).

1. Demonstration Letters

Kelerchian argues that the evidence does not support his

convictions for conspiring to make false statements and mak-

ing false statements in the demonstration letters submitted to

ATF. To recap, Count III alleged that Kelerchian violated 18

U.S.C. § 371 by conspiring with Kumstar and Slusser to make

false statements to the ATF by submitting letters falsely claim-

ing that the Sheriff’s Department wanted demonstrations of

otherwise-prohibited weapons that Kelerchian wanted for his

personal collection. Counts IV through VII alleged that the

phony demonstration letters were false statements to the ATF

in violation of 18 U.S.C. § 1001.

Kelerchian bases his argument on narrow readings of the

text of the demonstration letters as compared to the

indictment. He reads the indictment narrowly to charge him

with conspiring to make and making specific false

18 No. 18-1320

statements—requests for demonstrations of machineguns.

Nowhere in the essentially identical demonstration letters,

Kelerchian contends, however, is there specific language,

false or otherwise, actually requesting a demonstration.

Because the indictment charged Kelerchian not with

conspiring to make and making any false statement to the ATF

but with conspiring to make and making specific false

statements to the ATF, the government was required to

produce evidence showing that the specific false statements

were in fact made and failed to do so. We disagree.

The letters said the Sheriff’s Department was “interested

in a demonstration” of several listed guns and had found a

dealer, Kelerchian, who had “offered to conduct such a

demonstration.” The letters explained that the

“demonstration[s] will give [the] department personnel a

better understanding of the capabilities, limitations, and

differences of these [requested] guns.” From the content of

these letters, a reasonable jury could find that these were false

requests for demonstrations. The letters could have had no

other purpose. In addition, Kelerchian’s own testimony

characterized the letters as a “request to demonstrate”

machineguns. Kumstar also testified that each of the letters

was “a demonstration request,” that Kelerchian had not

offered demonstrations, and that the Sheriff’s Department

was not really interested in any. In short, there was sufficient

evidence to support Kelerchian’s convictions for conspiring

to make and actually making false statements in the

demonstration letters that he and his co-conspirators drafted.

2. Money-Laundering Conspiracy

Kelerchian’s challenge to his conviction for conspiring to

commit money laundering poses the closest question in this

No. 18-1320 19

appeal. The money-laundering conspiracy charge stems from

the conspirators’ second and third fraudulent machinegun

purchases. The indictment charged Kelerchian with conspir-

ing to launder money in violation of 18 U.S.C. § 1956(h),

which makes it a crime to conspire to commit any of the

money-laundering offenses defined in § 1956 or § 1957.

The indictment specified that Kelerchian conspired to vio-

late this statute in two ways. First was a conspiracy to engage

in a financial transaction using the known proceeds of an un-

lawful activity (wire fraud to obtain the machineguns) to con-

ceal the ownership and control of the proceeds from the spec-

ified unlawful activity in violation of § 1956(a)(1)(B)(i). Sec-

ond was a conspiracy to use the proceeds of the wire fraud to

engage in a monetary transaction exceeding $10,000 in viola-

tion of § 1957. The jury found Kelerchian guilty of both al-

leged conspiracies. We focus on the conspiracy to violate

§ 1957, which we find was proven, so we need not address the

theory under § 1956(a)(1)(B)(i). See United States v. Joshua, 648

F.3d 547, 553 (7th Cir. 2011).

A money-laundering violation under either § 1956 or

§ 1957 requires proof of two distinct acts: the unlawful activ-

ity that generated “proceeds” and then the monetary transac-

tion conducted with the criminal proceeds. United States v.

Seward, 272 F.3d 831, 836 (7th Cir. 2001), quoting United States

v. Mankarious, 151 F.3d 694, 705 (7th Cir. 1998). The underly-

ing unlawful activity here was wire fraud. “To establish wire

fraud under 18 U.S.C. § 1343, the government must prove the

defendant (1) participated in a scheme to defraud, (2) in-

tended to defraud, and (3) used interstate wires in furtherance

of the fraud.” United States v. Buncich, 926 F.3d 361, 366 (7th

Cir. 2019). The wire fraud offense was completed during the

20 No. 18-1320

second and third machinegun transactions when Kelerchian

and the others sent materially false statements to H&K assert-

ing that the machineguns were being purchased by the Lake

County Sheriff. See United States v. Aslan, 644 F.3d 526, 545–46

(7th Cir. 2011) (wire fraud statute “punishes the scheme, not

its success”) (collecting cases); accord, e.g., United States v.

Kennedy, 707 F.3d 558, 566–67 (5th Cir. 2013) (wire fraud dis-

tinct from money laundering of proceeds); United States v.

Halstead, 634 F.3d 270, 280–81 (4th Cir. 2011) (health care fraud

distinct from money laundering of proceeds). The ma-

chineguns were the proceeds of that wire fraud. According to

the government, the way in which Kelerchian and Kumstar

sold these weapons to dealer Adam Webber constituted

money laundering.

The government’s theories for the money-laundering con-

spiracy are that, after completing the fraud in the second pur-

chase of machineguns, Kelerchian and Kumstar conspired to

conceal the fact that machinegun parts were intended for

dealer Adam Webber in violation of § 1956(a)(1)(B)(i) and con-

spired to engage in one or more transactions in criminally de-

rived proceeds worth more than $10,000 in violation of § 1957.

Kelerchian and Kumstar used Slusser as a middleman in their

dealings with Webber to obscure the true ownership of the

guns. In particular, Slusser sold the parts to Webber for

$18,900 and received a check in his name as payment. He was

instructed to deposit that check in his own account and then

to issue cashier’s checks to Kelerchian and Kumstar for $9,450

each. Kelerchian then waited nine months before paying H&K

for the weapons. The intention, the government argued, was

to make it appear as though the Sheriff’s Department bought

and retained control over the weapons. Further, Kelerchian

waited months to pay H&K to distance himself from the

No. 18-1320 21

Webber sale, making it look as though he was unaware of the

connection between the money sent to H&K and the check he

received from Slusser. The wire fraud theory thus holds to-

gether.

But the government’s explanation of its theory raised a

new issue in the law of wire fraud. The government must

show that the scheme to defraud was aimed at some form of

money or property. Cleveland v. United States, 531 U.S. 12, 19

(2000).2 In his opening appellate brief, Kelerchian argued that

the wire fraud the government alleged was not a transaction

distinct from the sale of the fraudulently obtained

machinegun parts to Webber. The government responded

that the wire fraud was complete as soon as the defendants

sent the purchase packets with fraudulent statements to

H&K, so that the later sale of the parts was a distinct offense.

We agree with that point, but Kelerchian argued in his reply

brief that the government’s solution to the distinct-transaction

problem posed a different fatal problem for the money-

laundering conspiracy charge. Submitting the fraudulent

statements to H&K to obtain the machineguns, Kelerchian

argued, did not amount to wire fraud because Kelerchian and

his co-conspirators did not deprive anyone of a “property

interest” as required under Cleveland.

This property interest issue takes us to the edges of federal

mail and wire fraud law and poses Kelerchian’s strongest

2 Although Cleveland and other Supreme Court cases establishing this

rule involve the mail fraud statute, 18 U.S.C. § 1341, as opposed to the wire

fraud statute, we have explained that “the elements of wire fraud under

18 U.S.C. § 1343 directly parallel those of the mail fraud statute” so that

“cases construing one are equally applicable to the other.” United States v.

Leahy, 464 F.3d 773, 786 (7th Cir. 2006).

22 No. 18-1320

challenge to any of his convictions. In McNally v. United States,

the Supreme Court explained that the federal mail fraud stat-

ute is “limited in scope to the protection of property rights.”

483 U.S. 350, 360 (1987), superseded by statute on other grounds,

18 U.S.C. § 1346. To establish mail fraud, the government thus

must “prove as an element of the offense … that the defendant

deprived the victim of a property right.” United States v. F.J.

Vollmer & Co., 1 F.3d 1511, 1520 (7th Cir. 1993), citing McNally,

483 U.S. at 359–61. Kelerchian argues that the government

failed to identify a victim whom the defendants intended to

deprive of a recognized property interest. He argues that nei-

ther the ATF’s regulatory interest in the transfer of firearms

nor H&K’s interest in the legal disposition of its guns quali-

fies. The government’s interest will not suffice, but H&K’s in-

terests will support the wire fraud theory.

As discussed above, F.J. Vollmer & Co. involved a scam in

which an Illinois National Guard captain, Kenneth Nevius,

defrauded a weapons manufacturer into selling him re-

stricted guns under the pretense that he was purchasing the

weapons “in connection with” his official duties. 1 F.3d at

1514. Nevius then resold the weapons to F.J. Vollmer & Com-

pany, a business dealing in the sale of firearms. Id. at 151314.

Nevius and F.J. Vollmer were convicted of mail fraud in vio-

lation of § 1341. F.J. Vollmer argued that the mail fraud charge

was insufficient because it “did not allege that the govern-

ment had a property interest in the guns as is required by

McNally.” Id. at 1520. As in this case, at F.J. Vollmer’s trial “the

government did not allege in the indictment, present evidence

at trial, nor was the jury instructed on the deprivation of a

property right.” Id.

No. 18-1320 23

We agreed with F.J. Vollmer, concluding that the govern-

ment was not deprived of a qualifying property interest.

Vollmer, 1 F.3d at 1521. The government argued that its “right

to control the disposition of … firearms is a property interest”

of which Nevius and F.J. Vollmer deprived it through mail

fraud. We rejected this argument, holding that “the govern-

ment’s regulatory interests are not protected by the mail fraud

statute.” Id. (emphasis added), citing, among other cases,

United States v. Bruchhausen, 977 F.2d 464 (9th Cir. 1992).

We conclude here, however, that the government proved

that Kelerchian and his co-conspirators committed wire fraud

against H&K, which had a sufficient property interest of

which they schemed to deprive it. Kelerchian finds support

for his position, though, in the Ninth Circuit’s Bruchhausen de-

cision. We consider first that case and then decisions of this

court and the Second Circuit that adopt a broader view of

property interests when parties are induced to enter into ille-

gal sales, especially of weapons.

In Bruchhausen, the defendant was charged with a scheme

to defraud American manufacturers by buying sophisticated

technology, promising falsely that the purchased equipment

would be used only in the United States, and then smuggling

the goods to countries in the Soviet Bloc. “Representatives

from these companies testified that they would never have

sold to Bruchhausen had they known the truth.” 977 F.2d at

466. On appeal the Ninth Circuit held that Bruchhausen had

not defrauded the manufacturers of “property interests”

within the meaning of the wire fraud statute. The court rea-

soned: “The manufacturers received the full sale price for

their products,” and “While they may have been deceived

into entering sales that they had the right to refuse, their

24 No. 18-1320

actual loss was in control over the destination of their prod-

ucts after sale.” Id. at 467. The Ninth Circuit wrote that while

“the manufacturer may have an interest in assuring that its

products are not ultimately shipped in violation of law … that

interest in the disposition of goods it no longer owns is not

easily characterized as property.” Id. at 468. Accordingly, the

court held “that the interest of the manufacturers in seeing

that the products they sold were not shipped to the Soviet

Bloc in violation of federal law is not ‘property’ of the kind

Congress intended to reach in the wire fraud statute.” Id.

If that view were correct, then it would be difficult to af-

firm Kelerchian’s money-laundering conspiracy conviction.

Bruchhausen is not the final word on the issue, however. The

government’s Rule 28(j) letter cited cases from this circuit and

the Second Circuit that support its view that Kelerchian and

the others defrauded H&K of a property interest sufficient to

allow use of wire fraud as “unlawful activity” to support

Kelerchian’s money-laundering conspiracy conviction, and

that view is consistent with the way the jury instructions and

the government’s closing argument framed Count IX for the

jury at trial.

We start with United States v. Leahy, 464 F.3d 773 (7th Cir.

2006), in which defendant Duff was convicted of defrauding

the City of Chicago. A Chicago ordinance required the city to

establish a goal of awarding not less than 25% of the annual

dollar value of all city contracts to qualified minority-owned

businesses and 5% of the annual dollar value to qualified

women-owned businesses, and set aside certain contracts for

such businesses. Id. at 778. To take fraudulent advantage of

the ordinance, Duff, a white man, obscured the ownership

and control of two of his businesses to give the city the false

No. 18-1320 25

impression that his mother and a black man were running

them. Id. at 77981. Through this fraud, Duff was able to win

lucrative contacts with the city. Duff and others were eventu-

ally convicted of wire fraud, in addition to other offenses. The

defendants appealed, arguing that the indictment could not

support a conviction under the applicable mail and wire

fraud statutes because “the only loss Chicago suffered was to

its regulatory interests—an intangible right unprotected by

these statutes.” Id. at 786.

We rejected that argument. We noted that the object of the

wire fraud was in fact property—money paid under con-

tracts. Id. at 78788. We distinguished Cleveland, where the Su-

preme Court held that for mail-fraud purposes, Louisiana did

not have a property interest in state permits or licenses it is-

sued for video poker machines. See 531 U.S. at 21–23. Unlike

the fraud to obtain the licenses in Cleveland, in Leahy “the

fraud was committed both against Chicago as a regulator and

also against the city as a property holder.” 464 F.3d at 788.

This “scheme precisely and directly targeted Chicago’s coffers

and its position as a contracting party.” Id. We concluded that

Chicago suffered a property loss “in that it paid for a service

provided by [a minority-owned business] or [women-owned

business] that it did not receive.” Id. We affirmed the mail and

wire fraud convictions.

Leahy is not precisely on point—the fraud there was aimed

at the buyer, not the seller, of products and services—but it is

instructive. First, in both cases, the object of the fraud was

property—money in Leahy and here machineguns. Second, in

both cases one party to a contract deceived the other to induce

it to enter into the contract. In Leahy the city was deceived into

contracting with businesses controlled by Duff rather than by

26 No. 18-1320

minorities or women, as the ordinance called for. Here, H&K

was induced to sell machineguns to a buyer it thought was

lawful (the Sheriff’s Department) when the real buyers were

the defendants, who could not lawfully buy the machineguns.

Kelerchian’s fraud deprived H&K of the ability to ensure that

its products were sold in compliance with federal law. As

Kelerchian points out, H&K was paid the full price for the ma-

chineguns. In Leahy, too, however, the city received the ser-

vices it paid for, yet not from the sorts of businesses it thought

it was paying for them. 464 F.3d at 788. We treated that sort of

loss as sufficient, noting that the object of the fraud “was

money, plain and simple, taken under false pretenses from

the city its role as a purchaser of services.” Id.

The government also finds support from Second Circuit

cases. In United States v. Schwartz, the defendants purchased

night-vision equipment from Litton Industries. 924 F.2d 410

(2d Cir. 1991). The Arms Export Control Act restricted the sale

of this equipment to certain countries (including Argentina,

then fighting the United Kingdom in the Falklands War), so

Litton sought assurances that the defendants would not ex-

port purchased equipment to restricted countries. Id. at 414.

The sales contracts required the buyers to assure that they

would comply “with all laws and regulations pertaining to

the export of night vision goggles.” Id. As the defendants

placed additional orders, Litton sought further assurances

and documentation that the equipment was not destined for

restricted countries. The defendants signed the contracts and

promised to abide by applicable laws but then exported reg-

ulated night-vision goggles to Argentina, where they were

used against British forces. Id. The defendants were convicted

of wire fraud, among other crimes. Id. at 420.

No. 18-1320 27

In challenging their wire fraud convictions for the Argen-

tine sales, the defendants argued that Litton did not suffer any

economic harm and thus could identify no qualifying prop-

erty interest. Id. The Second Circuit upheld the convictions be-

cause the defendants’ “misrepresentations went to an essen-

tial element of the bargain between the parties and were not

simply fraudulent inducements to gain access to Litton equip-

ment.” Id. at 421. The court explained that “the fact that Litton

was paid for its night vision goggles does not mean that Litton

received all it bargained for. In fact, it did not.” Id. The “de-

fendants’ conduct deprived Litton of the right to define the

terms for the sale of its property … and cost it, as well, good

will because equipment Litton … sold was exported illegally.”

Id.

In later cases, the Second Circuit has clarified the test it ap-

plied in Schwartz. The court has acknowledged that “[t]he

‘right to control one’s assets’ does not render every transac-

tion induced by deceit actionable under the mail and wire

fraud statutes.” United States v. Binday, 804 F.3d 558, 570 (2d

Cir. 2015), quoting United States v. Wallach, 935 F.2d 445, 463

(2d Cir. 1991). Its “cases have drawn a fine line between

schemes that do no more than cause their victims to enter into

transactions they would otherwise avoid—which do not vio-

late the mail or wire fraud statutes—and schemes that depend

for their completion on a misrepresentation of an essential el-

ement of the bargain—which do violate the mail and wire

fraud statutes.” Id., quoting United States v. Shellef, 507 F.3d 82,

108 (2d Cir. 2007). This is a fine distinction, but Kelerchian and

his co-conspirators fell on the wrong side of it, as the defend-

ants in Schwartz did with their fraud to obtain arms for illegal

export.

28 No. 18-1320

In Shellef, for example, the defendants persuaded a com-

pany to sell them hundreds of thousands of pounds of a

highly regulated chemical by falsely representing that they

would not resell the solvent within the United States. 507 F.3d

at 8990. The court distinguished Schwartz by focusing on the

different misrepresentations made in the cases. In Shellef, the

misrepresentations induced the seller only “to enter into a

transaction it would otherwise have avoided,” whereas in

Schwartz, the defendants had misrepresented “an essential el-

ement of the bargain.” Id. at 109, quoting Schwartz, 924 F.2d at

421. In explaining this distinction further, the Second Circuit

later said that it “reject[s] application of the mail and wire

fraud statute where the purported victim received the full

economic benefit of its bargain,” and upholds “convictions …

where the deceit affected or the victim’s economic calculus or

the benefits and burdens of the agreement.” Binday, 804 F.3d

at 570.

The Second Circuit opinions and our opinion in Leahy

show that schemes to defraud a party into entering a contract

it would not enter if it had been told the truth, but where the

fraudsters deliver the agreed money, goods, or services are

close to the edge of the reach of the wire and mail fraud

statutes. We do not attempt here, in this money-laundering

conspiracy case, to establish a comprehensive guide on the

scope of the mail and wire fraud statutes. We concentrate on

the case before us, focused on illegal imports of highly

regulated and dangerous machineguns. On the strength of

our decision in Leahy and the Second Circuit’s in Schwartz,

which is remarkably close to our facts and persuasive, we

conclude that the government proved that the scheme to

defraud H&K involved a sufficient property interest to

No. 18-1320 29

support using wire fraud as the underlying unlawful activity

for a money-laundering conspiracy charge.

As in Leahy, the scheme to defraud induced one party here

to contract with others who were not legally entitled to enter

into the contract. And as in Schwartz, this case involves much

more than the seller’s preferences about the terms of the deals.

As in Schwartz, an arms manufacturer was defrauded into

making a sale to buyers who were legally prohibited from

buying the goods. We agree with the Second Circuit’s expla-

nation in Schwartz that, in such a deal, the fact that the seller

was paid full price does not mean it received all it bargained

for and is not decisive. The Bruchhausen view fails to take into

account the damage to goodwill from the illegal sale and, we

add, the legal and regulatory risk that the seller faces in such

deals. If Litton (in Schwartz) and H&K (here) had known the

true facts of the sales, those companies would have faced

criminal liability. Even the investigation of the criminal trans-

actions posed costs and legal risks for the sellers.

In the language of the Second Circuit, the destination of

the machineguns—a law enforcement agency—was an

“essential element of the bargain” between H&K and the

supposed buyer. Without the Sheriff’s Department stationery,

Kelerchian and the others could not even have approached

H&K about buying these machineguns. The sale required

submitting the ATF forms and an application certifying that

the purchaser of the guns was a law enforcement agency.

Although H&K did not lose any money in the machinegun

transaction itself, by illegally selling firearms it opened itself

up to risks it did not bargain for: risks of liability, of increased

government scrutiny, and negative publicity, all of which in

turn could jeopardize future sales. These are serious

30 No. 18-1320

repercussions central to H&K’s calculus of the “benefits and

burdens” of this transaction.

Comparing the Ninth Circuit’s decision in Bruchhausen

with the Second Circuit’s decisions in Schwartz and its prog-

eny, we think the Second Circuit has the better reading of the

mail and wire fraud statutes. Although “property” in these

statutes is not broad enough to encompass intangible interests

like government regulatory interests, “property” is not so nar-

row as to exclude any tangible good or service for which fair

market value is paid. In Bruchhausen, the Ninth Circuit re-

jected the idea that a seller could have a cognizable property

interest “in assuring that its products are not ultimately

shipped in violation of law” because that would mean the

manufacturer’s interest is “in the disposition of goods it no

longer owns.” 977 F.2d at 468. We respectfully disagree. The

seller’s interest is not only in shipping goods legally, but also

in not selling products in violation of federal law. That interest

exists before the seller relinquishes ownership. As the concur-

rence in Bruchhausen explained: “The strictures an owner puts

on his willingness to sell an item are not mere ephemera.

When a prospective buyer lies in order to evade those stric-

tures, a fraud has been committed upon the owner of the item

just as surely as if the buyer had issued a rubber check.” Id. at

469 (Fernandez, J., concurring).

H&K sold the machineguns to Kelerchian and his co-

conspirators only because of their deceit. Because this fraud

deprived H&K of a cognizable property interest in avoiding

illegal sales of its products, the government established a

violation of § 1343. This is as far as we need to go to affirm

Kelerchian’s conviction on conspiracy to launder money in

violation of § 1957.

No. 18-1320 31

Kelerchian also argues that the government failed to prove

that he conspired “to conceal or disguise the nature, the loca-

tion, the source, the ownership, or the control of the proceeds

of” the wire fraud in the second machinegun purchase. See 18

U.S.C. § 1956(a)(1)(B)(i). Although such evidence is needed to

sustain a § 1956 conviction, we need not decide whether the

government proved this allegation. As discussed above, the

jury expressly found Kelerchian guilty of conspiring to violate

both § 1956 and § 1957. That means that Kelerchian must

show that the evidence was insufficient under either theory to

overturn his conviction on Count IX. Because a rational jury

could find Kelerchian guilty of conspiracy to violate § 1957,

we affirm his conviction on Count IX.

C. Jury Instructions

1. Standard of Review

Kelerchian raises several objections to the jury instruc-

tions. “We review de novo whether jury instructions accurately

summarize the law, but give the district court substantial dis-

cretion to formulate the instructions provided that the in-

structions represent a complete and correct statement of the

law.” United States v. Edwards, 869 F.3d 490, 496 (7th Cir. 2017),

quoting United States v. Daniel, 749 F.3d 608, 613 (7th Cir.

2014). We review jury instructions as a whole and in context.

United States v. al-Awadi, 873 F.3d 592, 598 (7th Cir. 2017).

2. Conspiracy Instructions

Kelerchian challenges the jury instructions on three dis-

tinct conspiracy charges. Count I alleged that he conspired to

make false statements regarding the records required to be

kept by a licensed firearms dealer. Making the false state-

ments violated 18 U.S.C. § 924(a)(1)(A), which is the

32 No. 18-1320

substantive crime. Similarly, making false statements to the

ATF in violation of 18 U.S.C. § 1001 was the substantive crime

of Count III’s conspiracy charge, and money laundering in vi-

olation of § 1956 and § 1957 was the substantive offense in

Count IX’s conspiracy charge.

To establish a conspiracy to commit an offense against the

United States in violation of § 371, the government must

prove “(1) an agreement to commit an offense against the

United States; (2) an overt act in furtherance of the conspiracy;

and (3) knowledge of the conspiratorial purpose.” United

States v. Soy, 454 F.3d 766, 768 (7th Cir. 2006). The government

must show only “that the conspirators agreed that the under-

lying crime be committed. … In other words, each conspirator

must have specifically intended that some conspirator commit

each element of the substantive offense.” Ocasio v. United

States, 136 S. Ct. 1423, 1432 (2016). “[T]he fundamental char-

acteristic of a conspiracy is a joint commitment to an ‘en-

deavor which, if completed, would satisfy all the elements of

[the underlying substantive] criminal offense.’” Id. at 1429,

quoting Salinas v. United States, 522 U.S. 52, 65 (1997) (altera-

tion in original).

Kelerchian asked the district court to instruct the jury that

the government had to prove every element of the substantive

offenses underlying the § 371 charges. The court declined to

give that instruction and instead, for each of the three relevant

conspiracy counts, gave the Seventh Circuit’s Pattern Jury In-

struction, telling the jurors that that government had to

“prove each of the following elements beyond a reasonable

doubt:”(1) that the conspiracy charged in the indictment ex-

isted; (2) that the defendant knowingly joined the conspiracy

with the intent to advance it; and (3) that one of the

No. 18-1320 33

conspirators committed an overt act to advance the charged

conspiracy. See 7th Cir. Pattern Criminal Jury Instr. § 5.08(A)

(2018). For each conspiracy count, the court also gave the ju-

rors an Eighth Circuit Pattern Instruction at the Government’s

request: “To help you decide whether the defendant con-

spired to commit” the relevant substantive offense, the jury

“should consider the elements of the [substantive offense].”

The court then listed the elements of each of the substantive

offenses and instructed the jurors that they “should consider

these elements in determining whether the defendant con-

spired to commit” the underlying offense at issue.

Kelerchian argues that these instructions misled the jurors

into thinking that they were not obliged to consider the ele-

ments of the substantive offenses to convict Kelerchian on the

conspiracy charges against him. In particular, he asserts that

the use of “should” as opposed to “must” was problematic.

He argues that the word “should” suggested that the jury

could disregard entirely the elements of the substantive

crimes in the conspiracy charges and convict on a finding that

a generic conspiracy existed, rather than a conspiracy to com-

mit a specific, defined crime. The problem was exacerbated,

Kelerchian contends, by instructions saying that the govern-

ment must prove the elements of conspiracy beyond a reason-

able doubt.

These instructions were not erroneous. We have said be-

fore that “should” and “must” are interchangeable in this con-

text: “[B]oth words are imperative when used to instruct a

jury,” and “it is hardly plausible that a jury would reach a dif-

ferent verdict based on the use of ‘should’ or ‘must.’” United

States v. Davis, 724 F.3d 949, 955 (7th Cir. 2013). That is how

the district court used the terms throughout its instructions

34 No. 18-1320

here. The jurors were instructed that, in deliberations, they

“should” or “should not” do a variety of things that are man-

datory or prohibited. For example, the jurors were told that

they “should not consider the possible punishment for the de-

fendant who is on trial,” “should rely on your independent

recollection of the evidence,” “should not be unduly influ-

enced by the notes of other jurors,” and “should find the de-

fendant not guilty” if the government failed to prove all ele-

ments of an alleged offense beyond a reasonable doubt. We

see no meaningful difference between the framing of these in-

structions and the instructions to which Kelerchian objects.

The instructions communicated correctly that to convict

on the conspiracy counts, the jury needed to find that Keler-

chian “agree[d] with [the] others to commit the acts which

constitute the substantive offense[s]” defined by

§ 924(a)(1)(A), § 1001, and §§ 1956 and 1957. United States v.

Craig, 573 F.2d 455, 486 (7th Cir. 1977). There was no error.

3. Demonstration Letter Instruction

Kelerchian also argues that the district court erroneously

instructed the jury regarding ATF’s requirements for demon-

stration letters. His issue is with Instruction 27, which said in

relevant part:

Machine guns may also be imported as dealer

samples if a dealer can establish to the Bureau

of Alcohol, Tobacco, Firearms and Explosives

by specific information:

o that there is a governmental customer

requiring a demonstration of the

weapons; and

No. 18-1320 35

o the weapons are available to fill sub-

sequent orders.

In addition, the governmental entity must pro-

vide a letter expressing a need for a particular

model or interest in seeing a demonstration of a

particular weapon.

If a dealer requests more than one machine gun

of a particular model, he must also establish his

need for the quantity of samples sought to be

imported.

Kelerchian contends that this instruction selectively

pulled a phrase from 27 C.F.R. § 479.112(c), which governs the

registration of imported firearms, including those acquired

pursuant to demonstration letters, to create the erroneous im-

pression that “dealer sales samples required a demonstration

of the weapons” to take place. The government responds that

Kelerchian is focusing on the wrong regulation. Instruction 27

addressed 27 C.F.R § 479.105, which applies to the transfer,

rather than the importation, of machineguns, and subsection

(d) specifically deals with demonstration letters. In short,

§ 479.112(c) applies to importation of firearms for demonstra-

tions and § 479.105(d) applies to domestic transfers of ma-

chineguns for the same purpose. Kelerchian was alleged to

have conducted dealer sample purchases involving the im-

portation of machine guns only in Count IV. The remaining

counts involved domestic transfers.

Regardless of which regulation Instruction 27 is based on,

Kelerchian’s challenge fails because the instruction did not

say that the dealer must actually perform a demonstration. It

said that a dealer must show “that there is a governmental

36 No. 18-1320

customer requiring a demonstration.” Another instruction

told the jury: “The law does not require a dealer who receives

a machine gun for use as a sale sample to do a demonstration

of the machine gun.” The instructions as a whole correctly

stated the law.

D. Closing Argument Issues

Kelerchian also argues that the government committed

prosecutorial misconduct and improperly amended the in-

dictment. Neither argument is persuasive.

1. Prosecutorial Misconduct

We review claims of prosecutorial misconduct in two

steps. “First, we determine whether the prosecutor’s com-

ments were improper standing alone. Second, we ask whether

the remarks in the context of the whole record denied the de-

fendants the right to a fair trial.” United States v. Durham, 766

F.3d 672, 684 (7th Cir. 2014), citing United States v. Bell, 624

F.3d 803, 811 (7th Cir. 2010). To evaluate the relevant state-

ments in context to determine whether they deprived a de-

fendant of a fair trial, we consider “1) the nature and serious-

ness of the misconduct; 2) the extent to which the comments

were invited by the defense; 3) the extent to which the preju-

dice was ameliorated by the court’s instruction to the jury;

4) the defense’s opportunity to counter any prejudice; and 5)

the weight of the evidence supporting the conviction.” United

States v. Common, 818 F.3d 323, 333 (7th Cir. 2016).

At trial, Kelerchian did not object to the prosecution’s ar-

guments in closing that he now argues are improper. We

therefore review only for plain error. “On plain-error review,

we may reverse if: (1) an error occurred, (2) the error was

plain, (3) it affected the defendant’s substantial rights, and (4)

No. 18-1320 37

it seriously affected the fairness, integrity, or public reputa-

tion of the proceedings.” United States v. Pierson, 925 F.3d 913,

919 (7th Cir. 2019), citing United States v. Olano, 507 U.S. 725,

73238 (1993). Together, these inquiries mean that Kelerchian

“must demonstrate that the comments at issue were ‘obvi-

ously’ or ‘clearly’ improper … [such] that not only was [he]

deprived of a fair trial, but also that the outcome of the trial

probably would have been different absent the prosecution’s

remarks.” United States v. Hills, 618 F.3d 619, 640 (7th Cir.

2010) (internal citation omitted). In essence, the question is

whether the argument was so egregious that the trial judge

was required to intervene without a defense objection.

Kelerchian argues that the government’s rebuttal improp-

erly appealed to the jurors’ emotions and invited them to con-

sider the societal consequences of their verdict. Some back-

ground is needed on relevant testimony solicited during trial.

There was testimony throughout trial that the machineguns

Kelerchian and his co-conspirators requested for dealer sales

samples were not appropriate for use by the Sheriff’s Depart-

ment. They included a “multipurpose belt-fed machine gun

… typically used on top of a Humvee or maybe on the door

of a helicopter” and a “light-weight, belt-fed machinegun,”

“designed for the Navy SEAL teams for warfare.” Testimony

of this nature helped show that the dealer sales sample letters

were fraudulent because the Sheriff’s Department had no use

for the sample firearms.

In closing, defense counsel responded by pointing out that

the ATF agreed to allow H&K to provide these weapons to

Kelerchian to demonstrate to the Sheriff’s Department:

I want to talk now about the demonstration let-

ters. Count 3 is charged as a conspiracy. Counts

38 No. 18-1320

4 through 7 are charged as making the actual

statement, the false statement. Every letter at is-

sue in this case says, well, basically the same

thing … approximately seven letters on the Lake

County Sheriff’s Department letterhead re-

questing firearms demonstrations of machine

guns from Kelerchian knowing the same to con-

tain a materially false, fictitious, and fraudulent

statement because Vahan Kelerchian very well

knew in fact, no demonstration was going to oc-

cur.

First of all, ladies and gentlemen, every single

one of those letters was accepted by the ATF,

was signed off by numerous people from the

ATF as justifying the transfer of those guns. This

whole discussion about these guns not being

appropriate for the Lake County Sheriff’s De-

partment is completely undercut by ATF sign-

ing off and indicating that, in fact, these are the

kinds of weapons that are justifiable in a

demonstration letter.

Defense counsel emphasized the point a second time in clos-

ing: “ATF found [these] letter[s] acceptable.”

In rebuttal, the government responded:

There is no way on earth that these types of

guns, any department would require a demon-

stration because they’re belt-fed machine guns

… [T]hese guns are so far outside the bounds of

what regular law enforcement uses that there is

no legitimate reason to have them

No. 18-1320 39

demonstrated. They’re belt-fed machine guns

with ammunition that is three inches long.

There’s no reason on earth why any law en-

forcement agency would want them to be

demonstrated. Mr. Kelerchian wants those. He

told you that, but there’s no reason an agency

would want them demonstrated. … That’s why

the demonstration letters are utter nonsense be-

cause the weapon is so far out of bounds it

doesn’t make any sense. Under their rationale,

the Lake County Sheriff’s Department, Mr.

Kelerchian, could demonstrate a tank, and he

would get to keep it. How absurd is that? The

law isn’t meant to function in absurdities. It’s

meant to be applied by rational people such as

you to determine what’s acceptable.

Kelerchian argues that the prosecution’s use of the word

“acceptable” invited the jury to decide what is socially ac-

ceptable as opposed to what is legal. According to the govern-

ment, its use of the term “acceptable” in context was meant

only to remind the jury that its job was to determine whether

the letters requesting demonstrations were legitimate. In re-

jecting a similar claim of plain error in closing argument, we

have noted that “[l]awyers sometimes are not as precise as

they should be when giving extemporaneous closing argu-

ments.” United States v. Thomas, — F.3d —, — , 2019 WL

3490675, at *6 (7th Cir. Aug. 1, 2019). This jury was instructed

to focus on the instructions and to remember that lawyers’ ar-

guments are not evidence. The government’s use of the am-

biguous term “acceptable,” which did not even draw an ob-

jection, did not deny Kelerchian a fair trial or rise to the level

of plain error.

40 No. 18-1320

2. Constructive Amendment

A constructive amendment of an indictment occurs in vi-

olation of the Fifth Amendment when the jury is allowed “to

convict for an offense outside the scope of the indictment.”

Pierson, 925 F.3d at 91920. Kelerchian argues that the govern-

ment’s closing attempted to change its theory of liability as to

the demonstration letter charges in Counts III through VII.

The government argued in rebuttal:

In Instruction Number 27, it tells you how you

get these guns into the country for purposes of

a demonstration. You know, it’s sales samples.

That’s what it’s called, dealer samples. There’s a

couple requirements. It’s pretty loose. I’ll grant

you that. And there certainly doesn’t have to be

any demonstration—and I mentioned that to

you in the first part of my closing—but whether

or not one occurs is sort of helpful to know

whether or not they intended one. And it says

that you have to have a document with specific

information that there was a governmental cus-

tomer requiring a demonstration of the weapon.

Again, there was no objection to this argument. On appeal,

Kelerchian argues that the reference to “‘a document with

specific information’ … led the jury to underst[and] that the

‘document’ the government referred to in relation to Instruc-

tion No. 27, [was], in fact the [demonstration] letters refer-

enced in Counts 3–7.” Although Kelerchian does not spell this

out clearly, he implies that the government changed its theory

for Counts III through VII, arguing now that the “false state-

ments” were in an unspecified document submitted to H&K

No. 18-1320 41

as opposed to in the demonstration letters as alleged in the

indictment.

We see no error, let alone a plain error. The government

was always clear that the demonstration letters were the basis

for Counts III through VII. They were the documents that con-

tained the “specific information” asserting “that there is a

governmental customer requiring a demonstration of the

weapons.” The government’s closing did not indicate other-

wise simply because in this excerpt it uses the term “docu-

ment” as opposed to “demonstration letter.”

The judgment of the district court is

AFFIRMED.