Court Opinion

ID: 4437732
Source: CourtListenerOpinion
Date Created: 2019-09-12 17:00:48.306135+00
Date Added: 2024-06-11T14:46:14.910826
License: Public Domain

FOR PUBLICATION

   UNITED STATES COURT OF APPEALS
        FOR THE NINTH CIRCUIT

 UNITED STATES OF AMERICA,                        No. 17-50011
                  Plaintiff-Appellee,
                                                    D.C. No.
                     v.                          2:16-cr-00038-
                                                     DOC-1
 SIMON HONG, AKA Seong Hong,
 AKA Seong W. Hong, AKA Seong
 Wook Hong,                                         OPINION
              Defendant-Appellant.

        Appeal from the United States District Court
           for the Central District of California
         David O. Carter, District Judge, Presiding

            Argued and Submitted April 12, 2019
                   Pasadena, California

                   Filed September 12, 2019

 Before: Richard A. Paez and Richard R. Clifton, Circuit
  Judges, and Morrison C. England, Jr., * District Judge.

                     Opinion by Judge Paez

    *
      The Honorable Morrison C. England, Jr., United States District
Judge for the Eastern District of California, sitting by designation.
2                   UNITED STATES V. HONG

                          SUMMARY **

                          Criminal Law

    The panel reversed convictions for aggravated identity
theft (18 U.S.C. § 1028A(a)(1)), affirmed convictions for
health care fraud (18 U.S.C. § 1347) and illegal
remunerations for health care referrals (42 U.S.C. § 1320a-
7b(1)(A)), and remanded for resentencing, in a case in which
the defendant, who owned and operated acupuncture and
massage clinics, engaged in a fraudulent Medicare-billing
scheme with physical therapy companies.

    Reviewing for plain error, the panel wrote that because
the evidence of actual knowledge was overwhelming, it did
not need to determine whether the district court erred by
giving a deliberate-ignorance instruction on the knowledge
element of health care fraud.

    The panel held that even reviewing de novo, none of the
defendant’s arguments regarding the sufficiency of the
evidence to support the illegal-remunerations convictions
warrants reversal. The panel held that there was sufficient
evidence for the jury to conclude (1) that patient referrals
were one purpose for the kickbacks, (2) that the defendant
referred the patients’ Medicare information to the physical
therapy companies, and (3) that the defendant received
kickbacks for arranging the furnishing of services with the
physical therapy companies. The panel held that any error

    **
       This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
                  UNITED STATES V. HONG                     3

in omitting the “furnishing of services” language in the jury
instruction was harmless.

    The panel reversed the aggravated identity theft
convictions because the defendant did not “use” the patients’
identities within the meaning of § 1028A, where neither the
defendant nor the physical therapists attempted to pass
themselves off as the patients. The panel held that United
States v. Osuna-Alvarez, 788 F.3d 1183 (9th Cir. 2015),
forecloses the defendant’s argument that the “without lawful
authority” element of aggravated identity theft was not
satisfied because the patients voluntarily provided their
information.

    The panel held that the district court did not err in
applying Sentencing Guidelines enhancements for the
defendant’s obstruction of justice and aggravating role in the
offense.

                        COUNSEL

Carlton F. Gunn (argued), Kaye McLane Bednarski & Litt,
Pasadena, California, for Defendant-Appellant.

Kerry Creque O’Neill (argued) and Byron McLain, Assistant
United States Attorneys; Lawrence S. Middleton, Chief,
Criminal Division; Nicola T. Hanna, United States Attorney;
United States Attorney’s Office, Los Angeles, California;
for Plaintiff-Appellee.
4                 UNITED STATES V. HONG

                         OPINION

PAEZ, Circuit Judge:

    Simon Hong owned and operated acupuncture and
massage clinics. He provided the Medicare-eligibility
information and identities of his clinics’ patients to physical
therapy companies. Those companies would then submit
claims to Medicare seeking payments for physical therapy
treatments that had not been provided. The physical therapy
companies paid a majority of the funds they received to
Hong, who the government successfully prosecuted for
health care fraud and related offenses.

    Hong appeals his jury convictions for health care fraud
in violation of 18 U.S.C. § 1347, illegal remunerations for
health care referrals in violation of 42 U.S.C. § 1320a-
7b(b)(1)(A), and aggravated identity theft in violation of
18 U.S.C. § 1028A(a)(1). He also challenges the district
court’s calculation of the United States Sentencing
Guidelines (“U.S.S.G.”) advisory range (i.e., the “advisory
sentencing guidelines range”).       We have jurisdiction
pursuant to 18 U.S.C. § 3742(a) and 28 U.S.C. § 1291. We
reverse the convictions for aggravated identity theft and
remand for resentencing. On all other grounds we affirm.

                              I.

    At trial, the government presented witnesses who had
participated in the Medicare billing scheme and been
separately charged as “co-schemers” (Joseff Sales, Eddieson
Legaspi, and Danniel Goyena). The government also called
as witnesses four patients who had received treatment at
Hong’s clinics; two federal investigators; a Medicare claims-
processing expert; and a man who had coordinated a similar
scheme with Hong’s help (Byong Min). The government,
                      UNITED STATES V. HONG                               5

with these witnesses and documentary evidence, established
the following facts.

    Hong owned and operated three massage and
acupuncture clinics in Southern California under the
company names CMH Practice Solution, Hong’s Medical
Management, and HK Practice and Solution, Inc. Hong
made arrangements with outpatient physical therapy
companies, RSG Rehab Team, Inc. (“RSG”) and Rehab
Dynamics, Inc. (“RDI”), wherein he would provide the
infrastructure of a clinic and they would bill Medicare.
Unlike Hong and his clinics, as physical therapy companies,
RSG and RDI had Medicare provider numbers that allowed
them to submit claims for payments.

    Hong provided the clinic space, a receptionist, massage
therapists, acupuncturists, drivers, and patients who were on
Medicare. The patients received massage and acupuncture
treatments, but essentially no physical therapy. The patients
did not pay for any treatments. They provided their
Medicare identification information to the clinics and
believed that Medicare would pay for the massages.
Medicare does not pay for massages or acupuncture. 1

     RSG and RDI physical therapists used the patients’
Medicare information to submit claims to Medicare for
physical therapy services. Hong instructed the therapists to
bill Medicare for four and later five units per patient per date
of visit (where a unit is 15 minutes of service) in order to

    1
      The Medicare expert testified that Medicare might pay for some
massages, such as to loosen an extremely stiff joint, if performed by a
physical therapist. In this case, the record is clear that the massages were
not performed by physical therapists.
6                 UNITED STATES V. HONG

make more money. RSG and RDI paid Hong’s companies
56% of the payments they received from Medicare.

    Hong’s relationship with RSG began when he asked
RSG to “back-bill[]” Medicare for physical therapy
treatments that had not been provided in the past. Sales, a
physical therapist for RSG, testified that when he went to
Hong’s clinics he “almost never” provided physical therapy
treatments. Legaspi, a physical therapist for RDI, testified
that he only met with about half of the patients for whom he
prepared claims. Legaspi observed that “about [one]
hundred percent” of the patients received acupuncture or
massages from Hong’s employees “as opposed to any form
of physical therapy.” When therapists asked Hong about
providing patients with more physical therapy, Hong told
them the patients prefer massages and might stop coming to
the clinics if made to exercise.

    Patients similarly testified that they received little to no
physical therapy services. They received “maybe 5 to
10 minutes” of physical therapy compared to approximately
“40 to 50 minutes” of massage treatment each time they went
to the clinic. The patients who testified learned of the clinics
through family or people in their neighborhoods, not through
their doctors. They went to Hong’s clinics because of pain,
and they wanted the massage or acupuncture treatments.

    Through this scheme, thousands of false claims were
submitted to Medicare for physical therapy services between
May 2009 and November 2013. Medicare paid a little over
$2.9 million, of which Hong received just over $1.6 million.
Hong received checks for his share of the Medicare
payments at least once a week.

   Hong also taught Min how to operate massage clinics
and bill Medicare for physical therapy. When Min learned
                  UNITED STATES V. HONG                     7

he was being investigated for fraud, he reached out to Hong,
and Hong coached him to lie to investigators. Min testified
that Hong told him to say that after the patients received
physical therapy treatment, he would just provide
acupuncture or massage treatment as an “extra service.” Min
also arranged for Hong to reassure the president of Min’s
physical therapy clinic, Julian Yniguez, that nothing would
come of the investigation. Cooperating with investigators,
Yniguez recorded his conversation with Hong. Min
ultimately pled guilty to health care fraud and illegal
remunerations in a separate case.

   Later, federal investigators also recorded an interview
with Hong, during which Hong said he knew acupuncture
and massages could not be billed to Medicare. Hong agreed
with the investigators that he was at his clinics “every day.”

    After the government rested, Hong moved for acquittal
on all counts pursuant to Federal Rule of Criminal Procedure
29, arguing insufficient evidence. The district court denied
the motion. Hong did not present any witnesses.

    The jury returned a guilty verdict on all counts: eight
counts of health care fraud (Counts 1–8) (18 U.S.C. § 1347),
nine counts of illegal remunerations (i.e., kickbacks)
(Counts 9–17) (42 U.S.C. § 1320a-7b(b)(1)(A)), and two
counts of aggravated identity theft (Counts 18–19)
(18 U.S.C. § 1028A(a)(1)).

    At sentencing, the district court calculated an offense
level of 30 and a criminal history category I, which meant
the advisory sentencing guidelines range was 97–121
months, in addition to a mandatory consecutive 24-month
sentence for the aggravated identity theft convictions. See
18 U.S.C. § 1028A(a)(1). Relevant here, in reaching that
range the district court applied a four-level role enhancement
8                 UNITED STATES V. HONG

under U.S.S.G. § 3B1.1(a) because Hong was an “organizer
or leader” in criminal activity involving five or more
participants. In addition to Hong, the district court found
that Sales, Legaspi, Min, and Goyena were also participants
in the scheme and recognized that there may have been
others. The district court also acknowledged that another
person named as a co-schemer in the indictment, Marlon
Songco, had pled guilty. The district court also applied a
two-level obstruction of justice enhancement under U.S.S.G.
§ 3C1.1 based on Hong instructing and encouraging other
co-schemers to lie to investigating agents. Hong objected to
the obstruction of justice and role enhancements.

    The district court sentenced Hong to 97 months
imprisonment for the health care fraud convictions and
60 months imprisonment for the kickback convictions to run
concurrently. For each aggravated identity theft conviction,
the court sentenced Hong to 24 months imprisonment, to run
concurrently with each other but consecutive to the other
97 months. This resulted in a total sentence of 121 months
imprisonment.

                              II.

    On appeal, Hong raises separate challenges to each of his
convictions. First, with respect to his convictions for health
care fraud, Hong argues the district court erred in giving a
deliberate ignorance instruction on the knowledge element.
Second, Hong challenges his kickback convictions by
arguing that referrals for health care services that were never
actually provided are outside the scope of the statute
criminalizing remunerations for health care referrals, and
that the jury should have been so instructed. Third, Hong
argues that submitting fraudulent Medicare claims with his
clinics’ massage patients’ identifying information does not
constitute aggravated identity theft.
                 UNITED STATES V. HONG                    9

    Hong also challenges the district court’s application of
the obstruction of justice and role enhancements in
calculating the advisory sentencing guidelines range.

                  A. Health Care Fraud

   We begin with Hong’s challenges to his convictions for
health care fraud. Defrauding a health care benefit program
such as Medicare is unlawful. Pursuant to 18 U.S.C. § 1347:

       Whoever knowingly and willfully executes,
       or attempts to execute, a scheme or artifice—

       (1) to defraud any health care benefit
       program; or

       (2) to obtain, by means of false or fraudulent
       pretenses, representations, or promises, any
       of the money or property owned by, or under
       the custody or control of, any health care
       benefit program,

       in connection with the delivery of or payment
       for health care benefits, items, or services,
       shall be fined under this title or imprisoned
       not more than 10 years, or both.

For the “knowingly and willingly” part of the health care
fraud elements, the jury was instructed on actual knowledge
10                    UNITED STATES V. HONG

and deliberate ignorance, the latter of which Hong
challenges was in error. 2

    Because Hong did not object to this instruction in district
court, we review for plain error. United States v. Backman,
817 F.3d 662, 665 (9th Cir. 2016). We may only correct a
plain error where the appellant demonstrates that: (1) there
is an error; (2) the error is clear or obvious, rather than
subject to reasonable dispute; (3) the error affected the
appellant’s substantial rights, which in the ordinary case
means it affected the outcome of the district court
proceedings; and (4) the error seriously affects the fairness,
integrity or public reputation of judicial proceedings. United
States v. Marcus, 560 U.S. 258, 262 (2010).

    A deliberate ignorance—or “willful blindness”—
instruction is only relevant if the jury rejects the
government’s evidence of actual knowledge. United States

     2
      The deliberate ignorance instruction that was given at trial was the
Ninth Circuit model jury instruction at the time, and is very similar to
the current model instruction. The jury was instructed:

         You may find that the defendant acted knowingly if
         you find beyond a reasonable doubt that the defendant,
         first, was aware of a high probability that health care
         fraud was occurring and, second, deliberately avoided
         learning the truth.

         You may not find such knowledge, however, if you
         find that the defendant actually believed that there was
         no health care fraud, or if you find that the defendant
         was simply careless.

Model Crim. Jury Instr. 9th Cir. 5.8 (2014). The only difference in the
current model instruction is that it ends, “. . . or if you find the defendant
was simply negligent, careless, or foolish.” See Model Crim. Jury Instr.
9th Cir. 5.8 (2018).
                   UNITED STATES V. HONG                      11

v. Heredia, 483 F.3d 913, 922 (9th Cir. 2007) (en banc). “In
deciding whether to give a willful blindness instruction, in
addition to an actual knowledge instruction, the district court
must determine whether the jury could rationally find willful
blindness even though it has rejected the government’s
evidence of actual knowledge.” Id. A jury can believe some,
but not all, evidence presented by a party. Id. at 923. As we
have said before, “[t]he government has no way of knowing
which version of the facts the jury will believe, and it is
entitled (like any other litigant) to have the jury instructed in
conformity with [different] rational possibilities. That these
possibilities are mutually exclusive is of no consequence.”
Id. Still, “the district judge has discretion to refuse” the
instruction even where its factual predicates are present. Id.
at 924.

    We need not determine whether it constituted error to
give the instruction in this case because the evidence of
actual knowledge was overwhelming and thus Hong’s
substantial rights were not affected. Marcus, 560 U.S.
at 262. The jury heard a recording of Hong admitting to a
federal investigator that he knew it was illegal to bill
Medicare for massages and acupuncture. An employee of
RSG testified that Hong had asked RSG to “back-bill[]”
Medicare for physical therapy treatments that had not been
provided in the past, where there was no way the physical
therapy could ever have occurred. And another witness
testified that Hong taught him how to use physical therapists
for billing Medicare and to change locations every few years
to avoid suspicion from Medicare. Given the strength of the
testimony supporting a finding of actual knowledge, there
was no plain error in also instructing the jury on deliberate
ignorance.
12                UNITED STATES V. HONG

     B. Illegal Remunerations for Health Care Referrals

    Next, we turn to Hong’s convictions for illegal
remunerations for health care referrals, i.e. “kickbacks,”
pursuant to 42 U.S.C. § 1320a-7b(b)(1)(A). This anti-
kickback law prohibits “knowingly and willfully solicit[ing]
or receiv[ing] any remuneration (including any kickback,
bribe, or rebate) . . . for referring an individual to a person
for the furnishing or arranging for the furnishing of any item
or service for which payment may be made in whole or in
part under a Federal health care program,” such as Medicare.
42 U.S.C. § 1320a-7b(b)(1)(A).

    In challenging these convictions, Hong advances related
sufficiency of the evidence and jury instruction arguments.
He does not contest that he received 56% of the Medicare
payments. Instead, Hong argues there was insufficient
evidence to support the kickback convictions for three
reasons: the remunerations were not for the referral of
patients, but for Hong’s expenses to maintain the clinics; the
patients learned of the clinics on their own; and the
fraudulent billing was for services that were never furnished.
The government argues that Hong waived the second and
third contentions because when he moved for acquittal in the
district court, Hong advanced only the first argument. See
United States v. Graf, 610 F.3d 1148, 1166 (9th Cir. 2010)
(“[W]hen a Rule 29 motion is made on a specific ground,
other grounds not raised are waived.” (citation omitted)).

    Typically, we review de novo the sufficiency of the
evidence. Backman, 817 F.3d at 665. When reviewing the
sufficiency of the evidence to support a criminal conviction,
we “determine whether ‘after viewing the evidence in the
light most favorable to the prosecution, any rational trier of
fact could have found the essential elements of the crime
beyond a reasonable doubt.’” United States v. Nevils,
                     UNITED STATES V. HONG                            13

598 F.3d 1158, 1163–64 (9th Cir. 2010) (quoting Jackson v.
Virginia, 443 U.S. 307, 319 (1979)). A waived ground,
however, may be reviewed only to prevent a manifest
miscarriage of justice. Graf, 610 F.3d at 1166. Even
reviewing de novo each ground for insufficient evidence to
support the kickback convictions, none supports reversal.

    Hong’s first argument is unavailing. Hong argues that
because he spent the remunerations on the clinics’ overhead
expenses, the remunerations were not kickbacks for
providing the patient information to the physical therapy
companies. 3 This argument is at odds with United States v.
Kats, where we recognized that the anti-kickback statute
requires only that “one purpose of the payment” be to induce
future referrals, “even if the payments were also intended to
compensate for professional services.” 871 F.2d 105, 108
(9th Cir. 1989) (quoting United States v. Greber, 760 F.2d
68, 69, 72 (3d Cir. 1985)).

    Witnesses from the physical therapy companies testified
that Hong provided them with the patients and their
identifying Medicare information. Without the patients or
their identifying Medicare information, the physical therapy
companies could not have submitted claims to Medicare and,
as Sales testified, they “wouldn’t have . . . any part in the

     3
       Hong argues the jury could not have found the payments were
“primarily” for his referral of the patients to the physical therapists,
drawing the word “primarily” from the jury instruction. See infra n.6.
A conviction for kickbacks does not require the payments be “primarily”
for referring patients, and the jury did not need to be so instructed. See
United States v. Kats, 871 F.2d 105, 108 n.1 (9th Cir. 1989). “[A]
sufficiency challenge should be assessed against the elements of the
charged crime, not against the erroneously heightened command in the
jury instruction.” Musacchio v. United States, 136 S. Ct. 709, 715
(2016).
14                   UNITED STATES V. HONG

clinic.” We therefore find there was sufficient evidence for
the jury to conclude that referrals were one purpose for the
kickbacks.

    Hong’s second argument fares no better. He argues that
there was also insufficient evidence that he “referred” the
patients since they learned of the clinics on their own,
through word of mouth. The issue, however, is not how the
patients selected a massage clinic, but how they—or their
identifying Medicare information—reached the physical
therapy companies filing claims for benefits. See United
States v. Patel, 778 F.3d 607, 609, 613–16 (7th Cir. 2015)
(disagreeing with the doctor’s argument that he could not be
liable for kickbacks because the “patient[s] independently
chose a specific provider” given that he participated in a
kickback scheme to sign referrals to that provider); see also
United States v. Dailey, 868 F.3d 322, 330–31 (5th Cir.
2017) (calling the doctor who signed necessary referral
forms and then received money in turn for those signatures
a “gatekeeper” and affirming his health care kickbacks
conviction). The evidence presented at trial was sufficient
for the jury to find that Hong referred the patients’ Medicare
information to the physical therapy companies. 4

    Third, Hong’s argument that he could not have violated
the statute because physical therapy services were never

     4
       In his reply brief, Hong reframes this argument to suggest that he
would have been a referrer if RSG and RDI had physically separate
facilities, but that providing the patients’ information to RSG and RDI at
his own clinics did not violate the anti-kickback statute. This new tactic
does not save the argument. Hong collected the patients’ information at
the massage clinics and referred it to the physical therapy companies for
billing, in return for payments—it does not matter whether the physical
therapy companies were within the same building.
                       UNITED STATES V. HONG                           15

“furnished” also fails. 5       The anti-kickback statute
criminalizes remuneration for referrals for “the furnishing or
arranging for the furnishing of any item or service . . .”
42 U.S.C.     § 1320a-7b(b)(1)(A)      (emphasis       added).
Accordingly, by the statute’s terms the services need not
have been provided. We have recognized that the anti-
kickback statute is meant to address “the potential for
unnecessary drain on the Medicare system.” Kats, 871 F.2d
at 108 (quoting Greber, 760 F.2d at 71). In the anti-kickback
statute, “any remuneration” includes “sums for which no
actual service was performed” in addition to those for which
some professional time was expended. Greber, 760 F.2d
at 71. Thus, there was also sufficient evidence for the jury
to conclude that Hong received kickbacks for arranging the
furnishing of services with the physical therapy companies.

     Relatedly, Hong argues that the district court erred by
failing to instruct the jury that the referral had to be for the
“‘furnishing of any item or service’ covered by Medicare.”
The district court instructed the jury on the elements of the
kickback charges without using the statute’s “furnishing”
language. 6 Hong did not object to the instruction at trial, so
    5
      Hong agrees that submitting Medicare claims for unperformed
services is fraud, but he contests that receiving money for unperformed
services is a kickback.

    6
        The jury was instructed:

           In order for the defendant to be found guilty of [illegal
           remunerations for health care referrals], the
           government must prove each of the following
           elements beyond a reasonable doubt:

           One, the defendant knowingly and willfully received
           money;
16                  UNITED STATES V. HONG

we review this claim for plain error. Backman, 817 F.3d at
665; see also Marcus, 560 U.S. at 262 (identifying the four
showings an appellant must make to establish plain error).
Any error in omitting the “furnishing of services” language
in the instruction was harmless and did not affect Hong’s
substantial rights or the outcome of the proceedings because
unlawful remunerations include “sums for which no actual
service was performed.” Greber, 760 F.2d at 71; see also
United States v. Vernon, 723 F.3d 1234, 1262–63 (11th Cir.
2013) (finding no plain error where a similar instruction was
given).

   In sum, there was sufficient evidence to support Hong’s
convictions for violating the anti-kickback statute and there
was no plain error in the jury instructions for those
convictions.

                C. Aggravated Identity Theft

    Hong’s third set of convictions was for aggravated
identity theft pursuant to 18 U.S.C. § 1028A(a)(1). This
identity theft statute prohibits “knowingly transfer[ring],
possess[ing], or us[ing], without lawful authority, a means
of identification of another person” during and in relation to

        Two, the money was paid primarily in order to induce
        the referral of a patient insured by Medicare;

        Three, the patient’s services were covered, in whole or
        in part, by Medicare; and

        Four, Medicare is a federal health care program.

There is no Ninth Circuit model jury instruction for the elements of
42 U.S.C. § 1320a-7b(b)(1)(A). The instruction given in this case is
consistent with the model instruction in the Eighth Circuit. See Model
Crim. Jury Instr. 8th Cir. 6.42.1320 (2018).
                  UNITED STATES V. HONG                     17

another felony, including health care fraud. 18 U.S.C.
§ 1028A(a)(1), (c). A conviction for aggravated identity
theft carries a mandatory two-year term of imprisonment in
addition to the punishment provided for the related felony.
Id. § 1028A(a)(1).

    The government alleged that Hong used the names and
Medicare-eligibility information of patients to submit, with
the help of his co-schemers, claims for benefits without
lawful authority. Hong argues there was insufficient
evidence of aggravated identity theft for two reasons: the
“without lawful authority” element was not satisfied because
the patients voluntarily provided their information; and this
fraudulent billing does not constitute a “use” of the patients’
identities within the meaning of the aggravated identity theft
statute. Although framed as sufficiency of the evidence
arguments, these are statutory interpretation arguments that
we review de novo. United States v. Osuna-Alvarez,
788 F.3d 1183, 1185 (9th Cir. 2015).

     The first argument is foreclosed by Osuna-Alvarez, in
which we held that permission to use another’s identity in an
unlawful scheme is not “lawful authority” under section
1028A. Id. at 1185–86 (“This [statute] clearly and
unambiguously encompasses situations like the present,
where an individual grants the defendant permission to
possess his or her means of identification, but the defendant
then proceeds to use the identification unlawfully.”). The
same is true in the health care fraud context. See United
States v. Mahmood, 820 F.3d 177, 187, 189 (5th Cir. 2016)
(citing Osuna-Alvarez throughout); United States v.
Abdelshafi, 592 F.3d 602, 607, 609 (1st Cir. 2010).

    The latter argument presents a new question for our
court: whether the fraudulent billing demonstrated in this
case constitutes a “use” of the patients’ identities under
18                    UNITED STATES V. HONG

section 1028A. Under other criminal statutes, we interpret
“use” in limited, context-specific ways. See, e.g., United
States v. Bain, 925 F.3d 1172, 1177 (9th Cir. 2019)
(describing our precedent limiting the “use” of a weapon
pursuant to the federal bankruptcy statute, 18 U.S.C.
§ 2113(d), to “active employment of the weapon” (internal
quotation omitted)). Interpreting section 1028A, two of our
sister circuits, the First and Sixth, have narrowly construed
“use” and reversed convictions for aggravated identity theft
in analogous contexts. United States v. Berroa, 856 F.3d 141
(1st Cir. 2017); United States v. Medlock, 792 F.3d 700 (6th
Cir. 2015). We agree with their reasoning.

    In Medlock, the defendants operated an ambulance
service that transported patients to kidney dialysis facilities,
and Medicare reimbursed them for the cost of such
transports. 792 F.3d at 703. The defendants filed Medicare
claims falsely stating that stretchers were required for the
transport, where the use of stretchers would entitle the
ambulance service to Medicare reimbursement. Id. at 705.
The Sixth Circuit looked to the text of section 1028A(a)(1),
noting that because “Congress placed ‘use’ near ‘transfers’
and ‘possesses,’ . . . ‘use’ must have a more limited
definition than the government suggests.” Id. at 706. The
Sixth Circuit reversed the aggravated identity theft
conviction because although the defendants “did transport
the specific beneficiaries whose names they entered on the
forms[,] they lied only about their own eligibility for
reimbursement for the service.” 7 Id. Critically, the
defendants “did not attempt to pass themselves off as anyone
other than themselves. [They] misrepresented how and why

     7
      The Sixth Circuit recognized the defendants in Medlock acted
“without lawful authority,” but that did not alter the court’s interpretation
of “use.” Id. at 708.
                  UNITED STATES V. HONG                      19

the beneficiaries were transported, but they did not use those
beneficiaries’ identities to do so.” Id. at 707; see also United
States v. Michael, 882 F.3d 624, 629 (6th Cir. 2018)
(interpreting Medlock and noting, hypothetically, that if a
pharmacist “inflated the amount of drugs he dispensed, the
means of identification of the [prescribing] doctor and
patient would not have facilitated the fraud”).

     The First Circuit reached the same result in Berroa.
There, the defendants obtained their medical licenses by
fraud. 856 F.3d at 147–48. The government argued that
filling prescriptions for patients—without lawfully obtained
medical licenses—was “use” of the patients’ identities for
purposes of the aggravated identity theft statute. Id. at 155–
56. But “the word ‘use’ is fraught with ‘interpretational
difficulties because of the different meanings attributable to
it.’” Id. at 156 (quoting Bailey v. United States, 516 U.S.
137, 143 (1995), superseded by statute on other grounds,
18 U.S.C. § 924(c)(1)). As the First Circuit recognized, the
legislative history of the aggravated identity theft statute
“provide[s] several examples of identity theft. Notably, each
of these examples involved the defendant’s use of personal
information to pass him or herself off as another person, or
the transfer of such information to a third party for use in a
similar manner.” Id. (quoting H.R. Rep. No. 108-528, at 5–
6, reprinted in 2004 U.S.C.C.A.N. 779, 781–82). These
examples included “bogus Federal income tax returns in
others’ names” and “use of stolen identity to apply for and
receive Social Security benefits.” Id. (internal quotations
omitted). “While, in a colloquial sense, [the defendants]
could be said to have ‘used’ their patients’ names in writing
prescriptions, they certainly did not attempt to pass
themselves off as the patients.” Id. To interpret “use”
broadly “could encompass every instance of specified
criminal misconduct in which the defendant speaks or writes
20                   UNITED STATES V. HONG

a third party’s name.” Id. (citing United States v. Spears,
729 F.3d 753, 756 (7th Cir. 2013)). Given the legislative
history and “limitless nature of the government’s alternative
construction,” the First Circuit “read the term ‘use’ to require
that the defendant attempt to pass him or herself off as
another person or purport to take some other action on
another person’s behalf.” 8 Id.

    This case is analogous to Medlock. Hong provided
massage services to patients to treat their pain, and then
participated in a scheme where that treatment was
misrepresented as a Medicare-eligible physical therapy
service. See Medlock, 792 F.3d at 706. Neither Hong nor
the physical therapists “attempt[ed] to pass themselves off as
the patients.” Berroa, 856 F.3d at 156. Hong’s fraudulent
scheme ran afoul of other statutes—namely, health care
fraud and unlawful remunerations—but not section 1028A.
We hold that Hong did not “use” the patients’ identities
within the meaning of the aggravated identity theft statute.
Accordingly, we reverse Hong’s convictions on Counts 18
and 19.

     8
       In subsequent cases, our sister circuits have affirmed convictions
for aggravated identity theft where defendants have “purport[ed] to take
some other action on another person’s behalf” through impersonation or
forgery. United States v. Valdes-Ayala, 900 F.3d 20, 35 (1st Cir. 2018)
(forging signatures); United States v. Morel, 885 F.3d 17, 23 (1st Cir.
2018) (depositing a forged check under another person’s name and
purporting to bear that person’s signature); see also United States v.
Munksgard, 913 F.3d 1327, 1330 (11th Cir. 2019) (internal quotations
omitted) (forging another person’s name to a contract submitted to a
bank in support of a loan application).
                  UNITED STATES V. HONG                      21

        D. Advisory Sentencing Guidelines Range

    Finally, Hong argues that the district court improperly
applied enhancements for obstruction of justice and for his
role in the offense in calculating his advisory sentencing
guidelines range.       “We review the district court’s
interpretation of the Sentencing Guidelines de novo, its
application of the Guidelines to the facts of the case for an
abuse of discretion, and its factual findings for clear error.”
United States v. Vallejos, 742 F.3d 902, 905 (9th Cir. 2014).

    A district court may apply a two-level obstruction of
justice enhancement to the base offense level “[i]f (1) the
defendant willfully obstructed or impeded, or attempted to
obstruct or impede, the administration of justice with respect
to the investigation, prosecution, or sentencing of the instant
offense of conviction, and (2) the obstructive conduct related
to . . . a closely related offense.” U.S.S.G. § 3C1.1. The
district court applied this enhancement based on Hong
instructing and encouraging other co-schemers to lie to
investigating agents. Specifically, the district court cited the
audio recording of Hong speaking with a participant in
Min’s fraud scheme.

    Hong objected to this enhancement in the district court,
arguing that his statements were a denial of guilt, not
obstruction. Now, Hong argues that Min’s fraud was not
part of Hong’s “instant offense” or a “closely related
offense,” and his attempts to “reassure” Min and participants
in his fraud scheme were not a “willful” attempt to obstruct
an investigation. The government contends that because
Hong’s argument has shifted on appeal, we should review
for plain error. But Hong’s “basic claim remains the
same”—that his communications with co-schemers were not
obstruction—so we review for abuse of discretion the district
court’s application of the guidelines and for clear error its
22                    UNITED STATES V. HONG

factual findings. See Vallejos, 742 F.3d at 905; see also
United States v. Wahid, 614 F.3d 1009, 1016 (9th Cir. 2010)
(declining to apply a heightened standard of review where
defendant’s arguments against the guidelines calculation
were based on different enhancements in district court and
on appeal).

     “[U]nlawfully influencing a co-defendant, witness, or
juror, directly or indirectly, or attempting to do so” is
obstructive conduct. U.S.S.G. § 3C1.1, cmt. 4(A). While
aware of an ongoing investigation, Hong told Yniguez, “just
. . . make [a] story,” and that he had “[a]lways” done that
and “they didn’t bring me to court.” There was no error in
treating this as obstructive conduct because it could be a
direct or indirect attempt to influence a potential witness
(even though Yniguez did not end up being a witness). We
affirm the district court’s application of the obstruction of
justice enhancement in determining the advisory sentencing
guidelines range.

    A district court may apply a four-level aggravating role
enhancement where, like here, “the defendant was an
organizer or leader of a criminal activity that involved five
or more participants or was otherwise extensive . . . .”
U.S.S.G. § 3B1.1(a).       A “participant” is “criminally
responsible for the commission of the offense, but need not
have been convicted.” Id., cmt. 1. The district court found
a total of five or more participants by counting Sales,
Legaspi, Songco, Min, and Goyena, in addition to Hong. 9

     9
        Because this enhancement, unlike the obstruction of justice
enhancement, does not include “closely related offenses,” the district
court erred in counting Min as a participant. Hong, however, concedes
that there were five or more participants. In addition to himself, he refers
to three as “equally culpable” (Sales, Goyena, and Songco), as well as a
                     UNITED STATES V. HONG                           23

Hong objected to this enhancement in district court. On
appeal, Hong argues there is no evidence of Hong acting as
a leader or organizer.

    The sentencing guidelines instruct the court to consider
the following factors in determining whether a defendant had
a leadership and organizational role:

         [T]he exercise of decision making authority,
         the nature of participation in the commission
         of the offense, the recruitment of
         accomplices, the claimed right to a larger
         share of the fruits of the crime, the degree of
         participation in planning or organizing the
         offense, the nature and scope of the illegal
         activity, and the degree of control and
         authority exercised over others . . . This
         adjustment does not apply to a defendant who
         merely suggests committing the offense.”

U.S.S.G. § 3B1.1, cmt. 4. Here, Hong recruited one of the
physical therapy companies to the scheme by asking the
physical therapists to bill Medicare for claims for physical
therapy treatments that had never been performed. He
provided the services for which the patients came to the
clinic and disclosed their Medicare information. He
instructed the physical therapists to bill for longer periods of
time in order to claim a larger payment. But see United
States v. Holden, 908 F.3d 395, 402–03 (9th Cir. 2018)
(instructing a co-equal in a criminal scheme is “‘facilitation’
rather than ‘organization’”). And Hong claimed the largest

fourth (Legaspi). Even without Min there were at least five participants,
including Hong.
24                   UNITED STATES V. HONG

share—56%—of the payments from Medicare. 10 Based on
these findings, we affirm the application of the aggravating
role enhancement in the sentencing guidelines range.

                                 III.

     Hong participated in and, through kickbacks, profited
from a health care fraud scheme. His conduct, however, falls
short of aggravated identity theft as it is contemplated in the
statute. We therefore reverse Hong’s convictions for
aggravated identity theft and remand for resentencing. On
all other grounds we affirm.

  AFFIRMED in part, REVERSED in part, and
REMANDED.

     10
      Hong provides no evidence for his argument that this arrangement
was meant to or did equalize the amounts each participant received after
paying their expenses.