Source: https://law.justia.com/cases/federal/appellate-courts/F2/895/1135/46935/
Timestamp: 2019-07-20 01:24:21
Document Index: 168624359

Matched Legal Cases: ['§ 1962', '§ 1962', '§ 1341', '§ 1962', '§ 841', '§ 1341', '§ 1962', '§ 1342', '§ 1396', '§ 1962', '§ 1962', '§ 1342', '§ 841', '§ 841', '§ 1961', '§ 1962', '§ 812', '§ 841', '§ 829']

United States of America, Plaintiff-appellee, v. Charles Hughes (88-1658), Luckett Larry (88-1659), Sanfordhoskow (88-1660), Basem Kandah (88-1661), and Daledudley (88-1751), Defendants-appellants, 895 F.2d 1135 (6th Cir. 1990) :: Justia
Justia › US Law › Case Law › Federal Courts › Courts of Appeals › Sixth Circuit › 1990 › United States of America, Plaintiff-appellee, v. Charles Hughes (88-1658), Luckett Larry (88-1659),...
United States of America, Plaintiff-appellee, v. Charles Hughes (88-1658), Luckett Larry (88-1659), Sanfordhoskow (88-1660), Basem Kandah (88-1661), and Daledudley (88-1751), Defendants-appellants, 895 F.2d 1135 (6th Cir. 1990)
US Court of Appeals for the Sixth Circuit - 895 F.2d 1135 (6th Cir. 1990)
Argued Nov. 30, 1989. Decided Feb. 12, 1990
Defendants' involvement in the operation of HMC was manifested in several ways. Hoskow assisted Fisher in setting up HMC. He provided equipment, contacts with doctors, loans and kickbacks in exchange for the right to serve as a broker for the clinic's blood testing business. Hoskow was convicted of one count of the Racketeer Influenced and Corrupt Organization Act ("RICO") conspiracy, in violation of 18 U.S.C. § 1962(d), one count of criminal RICO, in violation of 18 U.S.C. § 1962(c), and twelve counts of mail fraud, in violation of 18 U.S.C. § 1341. He was sentenced to a total of 17 years of imprisonment and fined $10,000. In addition, a $150 special assessment was imposed.
Dudley, a medical doctor, agreed to be a supervisory physician or "doctor of record" for $500 cash per week, in order to lend a facade of legitimacy to the medical practice at HMC. In fact, Dudley did not meaningfully supervise HMC's medical practice or obtain the required supervisory license. Instead, he directed the physician's assistants, who actually treated the patients, to provide the patients with the controlled substance of their choice. Dudley was found guilty of RICO conspiracy, in violation of 18 U.S.C. § 1962(d), two counts of unlawful distribution of controlled substances, in violation of 21 U.S.C. § 841(a) (1), and 16 counts of mail fraud, in violation of 18 U.S.C. § 1341. Dudley was sentenced to a total of four years in prison and a two-year parole term. In addition, a $950 special assessment was imposed.
Larry owned and operated the blood testing lab, Superior Bio-Medical Lab, Inc. Through his company, Larry paid illegal kickbacks to HMC in exchange for receiving HMC's blood testing business. Larry was convicted of RICO conspiracy, in violation of 18 U.S.C. § 1962(d), two counts of mail fraud, in violation of 18 U.S.C. § 1342, and Medicaid fraud, in violation of 42 U.S.C. § 1396h. Larry was sentenced to 18 months in prison.
Hughes, a registered pharmacist, owned and operated Sunshine Pharmacy. He filled illegal prescriptions from HMC for codeine, a Schedule III controlled substance. He then fraudulently billed the patient's insurance company for the medication. Hughes was found guilty of RICO conspiracy, in violation of 18 U.S.C. § 1962(d), criminal RICO, in violation of 18 U.S.C. § 1962(c), five counts of mail fraud, in violation of 18 U.S.C. § 1342, and one count of unlawful distribution of controlled substances, in violation of 21 U.S.C. § 841(a) (1). Hughes was sentenced to three years in prison, and a special assessment of $400 was imposed.
Kandah, a registered pharmacist, worked at East Pharmacy for Carl Scott ("Scott"). Kandah, at Scott's direction, filled controlled substance prescriptions from HMC that he knew were outside the scope of legitimate medical practice. Kandah was convicted of one count of unlawful distribution of controlled substances, in violation of 21 U.S.C. § 841(a) (1). Kandah was sentenced to three years in prison and four years of parole. In addition, a special assessment of $50 was imposed.
This court has a limited scope of review in appeals challenging the sufficiency of evidence. We must view the evidence in the light "most favorable to the government." Glasser v. United States, 315 U.S. 60, 80, 62 S. Ct. 457, 469, 86 L. Ed. 680 (1942); United States v. Grunsfeld, 558 F.2d 1231, 1238 (6th Cir. 1977). We are bound to make all reasonable inferences and credibility choices in support of the jury's verdict. United States v. Stull, 743 F.2d 439, 442 (6th Cir. 1984), cert. denied, 470 U.S. 1062, 105 S. Ct. 1779, 84 L. Ed. 2d 838 (1985). Moreover, if "any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt," the convictions must be affirmed. Jackson v. Virginia, 443 U.S. 307, 319, 99 S. Ct. 2781, 2789, 61 L. Ed. 2d 560 (1979) (emphasis in original).
Whether a single conspiracy or multiple conspiracies have been shown is a question of fact resolved by the jury. A conspirator need not have agreed to commit every crime within the scope of the conspiracy, so long as it is reasonable to infer that each crime was intended to further the enterprise's affairs. See United States v. Sutton, 642 F.2d 1001, 1017 (6th Cir. 1980). Moreover, it is not necessary for each conspirator to participate in every phase of the criminal venture, provided there is assent to contribute to a common enterprise. See United States v. Grassi, 616 F.2d 1295, 1303 (5th Cir.), cert. denied, 449 U.S. 956, 101 S. Ct. 363, 66 L. Ed. 2d 220 (1980) ("Seemingly independent transactions may be revealed as parts of a single conspiracy by their place in a pattern of regularized activity involving a significant continuity of membership.").
When exercising appellate review of the sufficiency of the evidence to support a RICO conspiracy conviction, we must first determine if a conspiracy existed and then whether the defendant was a member of that conspiracy. See United States v. Truglio, 731 F.2d 1123, 1132 (4th Cir.), cert. denied, 469 U.S. 862, 105 S. Ct. 197, 83 L. Ed. 2d 130 (1984). Defendants' agreement to participate in the RICO conspiracy may be inferred from their acts. United States v. Joseph, 835 F.2d 1149, 1152 (6th Cir. 1987) (inference drawn from defendant's acts is sufficient evidence of an agreement to participate in the affairs of the enterprise). Thus, for the RICO conspiracy counts, the government need not prove that each defendant personally committed two racketeering violations or overt acts in furtherance of the conspiracy.
We are unpersuaded by Dudley's allegations of naivete. After reviewing the record, we find Dudley's contention that he was convicted on a negligence standard to be mere conjecture. The jury was instructed that they must find that Dudley specifically intended to participate in the illegal scheme. Because Dudley was a licensed physician, the jury could not find him guilty of distributing controlled substances, as long as he acted in "good faith." United States v. Moore, 423 U.S. 122, 140, 96 S. Ct. 335, 344, 46 L. Ed. 2d 333 (1975) (physicians protected from criminal liability when dispensing controlled substances in the course of professional practice). There is substantial evidence to support Dudley's conviction on the RICO conspiracy count. Dudley's involvement at HMC invites the inference drawn by the jury--he agreed to participate in the RICO enterprise. Based on the evidence presented at trial, we conclude that a reasonable juror could have found the essential elements of the RICO conspiracy beyond a reasonable doubt.
The definition of "enterprise" under 18 U.S.C. § 1961(4) includes "association in fact." We find that the record provides overwhelming evidence that the defendants and defendant corporations were associated in the scheme to provide Schedule III drugs in exchange for blood that could be subjected to comprehensive blood testing in order to defraud Medicaid and Blue Cross Blue Shield of Michigan.
We are also unpersuaded by Hughes' allegation of insufficient evidence to sustain the criminal RICO offense. It was incumbent upon the government to establish the following elements of the criminal RICO offense: (1) that Hughes engaged in or conducted an enterprise; (2) that the enterprise affected interstate commerce; (3) that Hughes' conduct or participation in the enterprise was conducted through a pattern of racketeering activity; and (4) that the pattern of racketeering involved two or more instances of offenses set forth in the statute. 18 U.S.C. § 1962(c). See Sedima, S.P.R.L. v. IMREX Co., 473 U.S. 479, 496, 105 S. Ct. 3275, 3285, 87 L. Ed. 2d 346 (1985); United States v. Sutton, 642 F.2d 1001, 1008 (6th Cir. 1980), cert. denied, 453 U.S. 912, 101 S. Ct. 3143, 69 L. Ed. 2d 995 (1981). Based on the record, a reasonable jury could find that the elements of a criminal RICO offense had been established.
Kandah filled most of the telephone prescriptions received at East Pharmacy. Over 90% of the patients from HMC received Tylenol 3. Consistent with the "good faith" practice of pharmacy, Kandah recognized the problems with HMC prescriptions and initially refused to fill them. The November 2, 1985 prescriptions, however, were filled after Kandah closed the pharmacy upon realizing that the prescriptions were illegal. Kandah's decision to re-open East Pharmacy and continue to fill prescriptions after realizing that they were not prescribed within the course of legitimate medical practice provides ample evidence to support his conviction for unlawful distribution of controlled substances.11 B.
The district court's denial of Dudley's motion for severance will be overruled on appeal only if we find that the district court abused its discretion. United States v. Bibby, 752 F.2d 1116, 1123 (6th Cir. 1985), cert. denied, 475 U.S. 1010, 106 S. Ct. 1183, 89 L. Ed. 2d 300 (1986); United States v. Licavoli, 725 F.2d 1040, 1051 (6th Cir.), cert. denied, 467 U.S. 1252, 104 S. Ct. 3535, 82 L. Ed. 2d 840 (1984). Dudley has the burden of showing specific and compelling prejudice. However, Dudley fails to sustain his burden. Despite Dudley's claims that prejudicial spill-over evidence and the transference of guilt were largely responsible for his conviction, he does not cite a single piece of prejudicial evidence that would have been inadmissible in a separate trial. Dudley was charged with the fraudulent blood testing offenses that he contends produced the prejudicial evidence.12 A separate trial would have had no effect on the government's presentation of evidence in its attempt to link him to the fraudulent blood testing component of the scheme.
Since Dudley failed to object to Dr. Koenig's testimony at trial, we will apply the plain error standard of review to this issue. United States v. Frady, 456 U.S. 152, 163, 102 S. Ct. 1584, 1592, 71 L. Ed. 2d 816 (1982). Expert testimony is admissible in criminal cases to establish the "generally acceptable standards of medical practice for issuing prescriptions." United States v. Kirk, 584 F.2d 773, 785 (6th Cir.), cert. denied, 439 U.S. 1048, 99 S. Ct. 726, 58 L. Ed. 2d 708 (1978).
Dr. Koenig testified that the State of Michigan requires physician's assistants to be licensed, sponsored by a doctor, and to work only under the supervision of a doctor. He testified that it would be improper for a doctor to delegate responsibility for prescribing controlled substances to a physician's assistant. Dr. Koenig specifically designated the following practices as inconsistent with legitimate medical practice: (1) adopting a policy that every patient could be given Tylenol 3; (2) drawing blood before the patient was examined in any way; (3) accepting kickbacks from a medical laboratory; (4) failing to document a physician's review of patient charts; and (5) telling a physician's assistant to use her own judgment in prescribing Tylenol with codeine. Dr. Koenig also testified that Michigan law specifically prohibits physician's assistants from prescribing controlled substances. Mich.Stat.Ann. Sec. 14.15(17076) (3) [M.C.L.A. Sec. 333.17076(3) ]. Dr. Koenig did not specifically testify about Dudley or the operations at HMC.13
Dr. Koenig's expert testimony was offered to establish the standards of medical practice for issuing prescriptions. By responding to hypothetical questions, Dr. Koenig offered his expert opinion that certain practices, established by other evidence, were beyong the scope of legitimate medical practice.14 The government's use of his expert testimony is consistent with other cases in which a physician is charged with distributing controlled substances by illegal prescriptions. See United States v. Word, 806 F.2d 658 (6th Cir. 1986), cert. denied, 480 U.S. 922, 107 S. Ct. 1383, 94 L. Ed. 2d 697 (1987); accord United States v. Bartee, 479 F.2d 484, 488 (10th Cir. 1973). Thus, we find that permitting Dr. Koenig's testimony did not constitute plain error.
Decisions regarding the quashing of a subpoena duces tecum, submitted pursuant to Rule 17(c)16 of the Federal Rules of Criminal Procedure, are committed to the trial judge's discretion. See United States v. Nixon, 418 U.S. 683, 702, 94 S. Ct. 3090, 3104, 41 L. Ed. 2d 1039 (1974) ("Enforcement of a pretrial subpoena duces tecum must necessarily be committed to the sound discretion of the trial court since the necessity for the subpoena most often turns upon a determination of factual issues."). On appeal, disturbing such a decision is unwarranted unless it is clearly arbitrary or without support in the record. United States v. Reed, 726 F.2d 570, 577 (9th Cir. 1984), cert. denied, 469 U.S. 871, 105 S. Ct. 221, 83 L. Ed. 2d 151 (citing United States v. Nixon, 418 U.S. 683, 94 S. Ct. 3090, 41 L. Ed. 2d 1039 (1974)). After careful review of the record, we are convinced that the district court properly exercised its discretion.
Rule 17's requirements of relevance,18 admissibility19 and specificity. Additionally, the district court found that the subpoena was unreasonable and oppressive.
United States v. Nixon, 418 U.S. 683, 94 S. Ct. 3090, 41 L. Ed. 2d 1039 (1974), guides our analysis of this issue. In Nixon, the Supreme Court held that production pursuant to Rule 17(c) is appropriate where it is shown that: (1) the documents are evidentiary and relevant; (2) they are not otherwise procurable, with due diligence, in advance of trial; (3) the party cannot properly prepare for trial without such production and inspection in advance of trial; and (4) the application was made in good faith and is not a fishing expedition. Id. at 699, 94 S. Ct. at 3103. The record reveals that Kandah failed to meet any of the four requirements.
Kandah contends that the subpoena should not have been quashed because the documents would have been admissible for impeaching the credibility of the government's witness. However, the Supreme Court noted in Nixon that "the need for evidence to impeach witnesses is insufficient to require its production in advance of trial." Id. at 701, 94 S. Ct. at 3104. The facts in the present case do not encompass the extraordinary circumstances that warranted the production of evidence in Nixon. In allowing the subpoena in Nixon, the Supreme Court noted the extraordinary circumstances of the tapes and their potential as direct evidence at trial, since they involved statements of alleged co-conspirators. Moreover, we have held that internal documents are not required to be produced when the witness' testimony at trial provides the information in the documents. United States v. Schultz, 855 F.2d 1217, 1223 (6th Cir. 1988). Therefore, by analogy, Bodendistal's testimony regarding the pharmacy practice did not require the production of documents that substantiated such testimony. Accordingly, the district court exercised sound discretion in quashing the subpoena.
21 U.S.C. § 812(b) (3) defines a Schedule III drug as one that has a currently accepted medical use, however, abuse of the drug "may lead to moderate or low physical dependence or high psychological dependence."
21 U.S.C. § 841(a) (1) prohibits the distribution of controlled substances except as authorized by federal law. Pharmacists and physicians are protected from liability when they dispense controlled substances in the course of professional practice. United States v. Moore, 423 U.S. 122, 140, 96 S. Ct. 335, 344, 46 L. Ed. 2d 333 (1975). It is unlawful, however, for a pharmacist to fill a prescription which is not issued for a legitimate medical purpose. 21 C.F.R. Sec. 1306.04 (providing, in pertinent part, "An order purporting to be a prescription issued not in the usual course of professional treatment or in legitimate and authorized research is not a prescription within the meaning and intent of section 309 of the Act (21 U.S.C. § 829) and the person knowingly filling such a purported prescription, as well as the person issuing it, shall be subject to the penalties provided for violations of the provisions of law relating to controlled substances."). We adopt the reasoning of the Fourth Circuit in United States v. Lawson, 682 F.2d 480, 482 (4th Cir.), cert. denied, 459 U.S. 991, 103 S. Ct. 348, 74 L. Ed. 2d 387 (1982) which held that where the government proves that a pharmacist knew that a purported prescription was not issued in the usual course of medical practice, a conviction will be sustained.
As we are convinced that the requested material was of no relevance and Kandah had an opportunity to discredit the witness at trial, we find Kandah's constitutional claims are without merit. See United States v. Valenzuela-Bernal, 458 U.S. 858, 867-72, 102 S. Ct. 3440, 3446-49, 73 L. Ed. 2d 1193 (1982) (to establish a violation of the sixth amendment's compulsory process guarantees, respondent must at least make a plausible showing that testimony sought was material and favorable to his defense). We will not address the constitutional claims further
The use of transcripts, like the admission of the underlying tapes, is a matter committed to the discretion of the trial court. United States v. Robinson, 707 F.2d 872, 878-79 (6th Cir. 1983). In the absence of the parties' stipulation to a transcript's accuracy, the transcriber should attest to the accuracy of the transcript and the trial court should make an independent determination of its accuracy by listening to the tape while reading the transcripts. Id. at 878-79.