March 2011 Archives

Tennessee Doctor Pleads Guilty to Making False Statements and Failing to Keep Proper Medical Records

March 28, 2011, by The McKellar Law Firm, PLLC

Johnson City, Tennessee doctor Michael Dube entered a guilty plea last week in Federal Court in Greeneville, Tennessee, for omitting material information from records required to be kept under the Controlled Substances Act (CSA) and making a false statement in connection with the renewal of his registration with the Drug Enforcement Administration (DEA), according to a press release from the U.S. Attorney's Office for the Eastern District of Tennessee. Dube, who is already on probation with the Tennessee Board of Medical Examiners, faces up to nine years in prison and possible fines up to $500,000.

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Per his plea agreement, Dube used his DEA registration to obtain prescription pain medication from drug suppliers which he then consumed himself. Further, he kept no records of the disposition of the drugs as required by the CSA and DEA regulations. Dube later confessed to DEA diversion investigators in March 2009 that he consumed the drugs himself and kept no records as to their distribution and disposition as required by statute and regulation, although he knew he was required to do so.

A medical practitioner must renew their DEA registration every three years, and Dube failed to answer his registration application accurately. In particular, one liability question on the application asks whether the applicant has ever surrendered (for cause) or had a state professional license or controlled substance registration revoked, suspended, denied, restricted, or placed on probation. Despite being placed on a 5-year probationary sentence in 2007, Dube answered "NO" to this question. The plea agreement states that at the time Dube made the representation, he knew that his state professional license had been placed on probation and that his answer to the question was false.

"This is a case where Dr. Dube had multiple opportunities to comply with state regulatory requirements and obey federal law. He has chosen not to do either . We will continue our efforts to help eradicate the illegal prescription pill distribution problem by focusing on the medical professionals and others who act outside of their licensed authority," said U.S. Atty. Bill Killian.

Man Sentenced to 1 Year in Federal Prison for Fraudulently Pretending to Be His Ex-Wife

March 25, 2011, by The McKellar Law Firm, PLLC

Apparently, even though all may be fair in love and war, all is not legal in love and war. According to the U.S. Attorney's Office in Idaho, Ricky Barry, a 60-year-old resident of Montana, was sentenced earlier this week to a year and a day in federal prison for unauthorized use of an access device by pretending to be his ex-wife while ordering a mattress and a laptop. Barry also paid $7,700 in restitution.

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Barry's plea agreement states that in May, 2008, Barry opened a line of credit in his ex-wife's name and ordered a Tempur-Pedic bed and sheets. The unauthorized access device used during the transaction was the Tempur-Pedic account number opened in his ex-wife's name. Tempur-Pedic recorded telephone calls Barry made on May 30 and July 3, 2008. In those calls, Barry pretended to be his ex-wife when speaking to company representatives and placing the order. Barry also signed the delivery documents with his ex-wife's name at the time the merchandise was delivered. The bed and sheets were later seized by federal agents when Barry's residence was searched pursuant to a federal search warrant.

This type of crime is codified generally in 18 U.S.C. § 1029 [Fraud and related activity in connection with access ­devices]. "Unauthorized access device" is defined at 18 U.S.C. § 1029(e)(3) as "any access device that is lost, stolen, expired, revoked, canceled, or obtained with intent to defraud." The relevant Sentencing Guidelines provision for this crime is found in USSG § 2B1.1, which covers economic fraud crimes generally.

Florida Doctor Found Not Guilty of Medicare Fraud

March 22, 2011, by The McKellar Law Firm, PLLC

While the majority of this blog is focused on the pitfalls of federal criminal defense for both attorneys and defendants, I enjoy learning about positive outcomes in cases, especially when a jury has decided that a defendant is not guilty. Earlier this month, a federal jury returned a not guilty verdict against Dr. Jorge J. Dieppa, who had been charged with committing Medicare fraud. According to an article in The Miami Herald, Dieppa was accused of sending hundreds of 300 patients to a pair of Miami area home healthcare agencies for costly diabetic services that prosecutors said were unnecessary or not provided.

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Dieppa exercised his right to testify, and he declared that he evaluated all of his patients and relied on his nurses before deciding whether the Medicare beneficiaries were qualified to receive diabetic services at home. Dieppa was originally charged by federal authorities, along with 93 other people with conspiring to defraud $251 million from Medicare by filing allegedly phony claims with the taxpayer-funded healthcare program.

In my experience, having clients testify is a high-risk, high-reward situation. In certain cases, a client's willingness to take the witness stand against the barrage of questioning and allegations from the Government can be well-received by a jury. Conversely, sometimes a client's decision to testify can result in convincing a jury of a client's guilt, even though a client may view him/herself as very persuasive. Ultimately, the decision to testify rests with the client, but it is a decision that should only be made after careful analysis with an experienced criminal defense attorney who may be aware of pitfalls that may be unknown to the client.

Man Sentenced to 18 Years for $600 Drug Deal in Federal Drug Case

March 17, 2011, by The McKellar Law Firm, PLLC

Clients are often in shock once they hear the differences in punishment between state crimes and federal crimes. Typically, the punishments in federal court are more severe than their state counterparts. One such example is the case Antwaun Ball, who was sentenced this week to an 18-year prison sentence after a federal jury convicted him of a single drug deal, involving a half of an ounce and which brought him proceeds of $600. To make matters worse for Ball, he seemingly had won the most severe allegations against him when a jury found him not guilty of conspiracy and racketeering charges. However, the sentencing judge still used alleged conduct by Ball, even alleged conduct for which the jury acquitted him, to sentence him.

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The Washington Times has more details on what is commonly referred to by federal criminal defense attorneys as "acquitted conduct." Simply put, judges are allowed to consider acquitted conduct in determining the appropriate sentence for a defendant. In Ball's case, the sentencing judge relied in part on information that Ball was the ringleader of a violent drug gang, despite the jury's acquittal on those allegations against Ball.

Acquitted conduct has been used here in the Sixth Circuit, and the Court elaborated on this issue in United States v. Roger Clayton White (6th Cir. 2008). In White, the Sixth Circuit responded to criticism that the defendant was being sentenced for acquitted conduct, by writing:

White thus is not being "sentenced for acquitted conduct" when White's sentencing judge takes that conduct into account in determining a sentence for the crime of which the White was convicted, as long as the sentence imposed falls within the range prescribed by law for that convicted conduct. Taking acquitted conduct into account unquestionably was permitted before the Guidelines were instituted, when a judge could sentence anywhere up to the maximum for convicted conduct, for any number of unstated reasons, including presumably a mere suspicion that the defendant also committed what the jury was not convinced of beyond a reasonable doubt. Taking acquitted conduct into account was not barred during the regime of mandatory Guidelines. See Watts, 519 U.S. at 151-52. Now that the Guidelines are advisory--a regime that floats between the previous two regimes--it seems particularly unusual to say that taking acquitted conduct into account all of a sudden is not permitted. It is permitted for the limited purpose of determining the sentence for convicted conduct, which must be shown by a preponderance of the evidence.

In the end, when you win, you may not win. Defense lawyers (and their clients) need to be very aware of the risks of acquitted conduct in the sentencing phase of a client's case. Winning the trial may only be the first battle to win in light of a client's acquitted conduct.


Chattanooga-Area Doctor Sentenced to 70 Months Incarceration for Writing Improper Prescriptions

March 10, 2011, by The McKellar Law Firm, PLLC

Federal and state prosecutions have been steadily increasing for medical doctors who issue medically unnecessary prescriptions, usually in the form of pain pills. The latest doctor in East Tennessee to be punished for such activities is Elizabeth Reimers of Winchester, Tennessee, who, according to a press release from the U.S. Attorney's Office for the Eastern District of Tennessee, was sentenced yesterday to 70 months incarceration in the Eastern District of Tennessee at Chattanooga by the Honorable Harry S. Mattice, Jr., United States District Judge.

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According to the press release, Reimers first came to the attention of law enforcement by a citizen who reported that Reimers was inappropriately prescribing addictive pain medication to drug-seeking patients without medical justification. Reimers allegedly prescribed pain-killers and other addictive substances even after her patients had overdosed on those medications or had been treated for addiction to them. Additionally, pharmacy records disclosed an abnormally high rate and amount of prescriptions issued by Dr. Reimers of pain medications.

The Government eventually set up an undercover sting operation, wherein an agent posed as a drug-seeking patient and was able to obtain addictive medications without any appropriate medical examination or justification. The press release reports that the undercover agent was even able to obtain such prescriptions for his fictional "brother" who Dr. Reimers never saw at all, and in whose existence she voiced disbelief.

United States Attorney Bill Killian stated what every prosecutor would echo:

I hope that this prosecution helps sound the alarm that we are experiencing a epidemic of prescription pill abuse in East Tennessee. Anyone, including a licensed doctor, who unlawfully distributes these pills will face substantial penalties. Dr. Reimers chose to ignore the oath all physicians take to "do no harm." Her actions had a devastating effect on several of her patients and the community at large. Our office will continue to target and prosecute those individuals who are responsible for illegally putting these powerful drugs on our streets.

Sixth Circuit Rules that Duplicate Images Count Separately under Child Pornography Sentencing Guidelines

March 8, 2011, by The McKellar Law Firm, PLLC

In an issue of first impression, the Sixth Circuit ruled that duplicate digital images, like duplicate hard copy images, count separately for purposes of determining an appropriate sentencing enhancement under USSG § 2G2.2(b)(7). In the case of United States v. Timothy McNerney, No. 09-4011, decided March 1, 2011, the Sixth Circuit addressed several important issues related to child pornography cases, but this blog post is focused only on the sentencing implications of having duplicate electronic copies of child pornography.

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In this case, the Defendant McNerney appealed his sentence of 10 years of incarceration, which he received after entering a guilty plea to one count of receiving and distributing visual depictions of real minors engaged in sexually explicit conduct in violation of 18 U.S.C. § 2252(a)(2), and one count of possession of child pornography in violation of 18 U.S.C. § 2252A(a)(5)(B).

The facts of the case are as follows: government agents, pursuant to an internet search, determined that McNerney was sharing images of child pornography via a peer-to-peer file-sharing program. After executing a search warrant, federal agents seized McNerney's computer and found numerous child pornography images. The agents also discovered that McNerney had backed up his files on a second hard drive, which created an identical copy of all files (including the child porn) on his computer.

At the sentencing hearing, the trial court calculated McNerney's total offense level pursuant to the Sentencing Guidelines at a level 30, which based on his lack of criminal history, resulted in an advisory sentence range of 97 to 121 months. The trial court calculated McNerney's offense level as follows:

1. The trial court began with a base offense level of 22
2. The trial court then added a two-level enhancement for images of prepubescent minors pursuant to U.S.S.G § 2G2.2(ii)
3. The court added a two-level enhancement for transferring materials over the internet pursuant to U.S.S.G § 2G2.2(b)(3)(F)
4. The court added a two-level enhancement for using a computer in the crime pursuant
to U.S.S.G § 2G2.2(b)(6)
5. The court added a five-level enhancement for having more than 600 images pursuant to U.S.S.G § 2G2.2(b)(7), producing a total offense level of 33.
6. Finally, the court then adjusted McNerney's offense level for acceptance of responsibility,
placing his final offense level at 30, which calls for a guideline range of 97-121 months.

McNerney specifically challenged the sentencing court's 5-level enhancement for possessing 600 or more images, pursuant to U.S.S.G § 2G2.2(b)(7). Section 2G2.2(b)(7) of the Sentencing Guidelines provides for an increase in a defendant's offense level for child pornography based on the number of images possessed as follows: "If the offense involved - (A) at least 10 images, but fewer than 150, increase by 2 levels; (B) at least 150 images, but fewer than 300, increase by 3 levels; (C) at least 300 images, but fewer than 600, increase by 4 levels; and (D) 600 or more images, increase by 5 levels."

McNerney contends that only unique digital images, not duplicate digital images, should be counted in computing an enhancement under this provision of the Sentencing Guidelines. The Sixth Circuit rejected McNerney's argument and delcared that "duplicate visual depictions, digital or otherwise, should each be counted separately for purposes of this enhancement."

In a bit of odd reasoning, the Sixth Circuit Court did write in a footnote that thumbnail images are not counted separately for U.S.S.G. § 2G2.2(b)(7) purposes because thumbnails are not duplicate digital images. Rather, the Court writes, thumbnails are simply previews of digital images that are viewable without opening the digital folder in which the digital images are contained.

Atlanta Doctor Indicted for Healthcare Fraud for Allegedly Treating Dead Patients

March 5, 2011, by The McKellar Law Firm, PLLC

An Atlanta, Georgia doctor has been indicted for filing false Medicare and Medicaid claims for patients which he never saw, including some patients who were already dead at the time he claimed to have administered treatment to them. The Atlanta Journal Constitution reports that Dr. Robert Williams was indicted in Atlanta for healthcare fraud and was arraigned yesterday in federal district court.

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According to a press release from the U.S. Attorney's Office in Atlanta, the prosecution alleges that Dr. Williams, during 2007 to 2009, contracted with a medical services company to provide group psychological therapy to nursing home patients. Per the doctor's signature, thousands of claims were submitted to Medicare and Georgia Medicaid seeking reimbursement for group psychological therapy that Dr. Williams claimed to provide to beneficiaries at nursing homes in the Atlanta area. Allegedly, in many instances, the doctor did not actually provide the therapy claimed.

Doctors are typically held to a high standard of conduct due to their position in society. In the aforementioned press release, prosecution representatives claim:

"As a physician, this defendant had a duty to protect his patients and look out for their interests first. He has been charged with crimes that reflect his misuse of his position and the trust placed in him, all at the expense of his elderly patients, Medicare and Medicaid. Dr. Williams allegedly stole Medicaid funds that were specifically allocated for the care of some of Georgia's most vulnerable citizens: the elderly."

If convicted of these healthcare fraud allegations, Dr. Williams is looking at a maximum 10-year sentence, a fine up to $250,000, and likely restitution of amounts improperly taken.

Oklahoma Woman Sentenced to 46 Months for Tax Evasion and Mail Fraud

March 1, 2011, by The McKellar Law Firm, PLLC

After pleading guilty in federal court of tax evasion and mail fraud, an Oklahoma woman received a 46-month sentence and was ordered to pay over a million dollars to her former employer and over $325,000 to the Internal Revenue Service. The Oklahoman, via its NewsOK.com website, reports that Debra Minshall, age 49, defrauded her former employer, a Chevrolet car dealership, for over 6 years. Minshall was accused of using company checks to pay her own credit card bills.

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People who are accused of committing economic crimes, such as mail fraud, will almost inevitably have tax crime allegations as well. One of the obvious reasons for this occurrence is the fact that people who are stealing or defrauding someone of money are usually not going to report their ill-gotten gains in a tax return. In other words, if someone files a tax return which reports $75,000 in income, but the person also embezzled $85,000, then the person's true income would not be $75,000. Therefore, a prosecutor could argue that the person has committed tax fraud by filing a false tax return.

26 U.S.C. § 7201 governs federal tax crimes, and the Tennessee version of the crime of tax evasion can be found at Tennessee Code Annotated § 67-1-1440(g). The required elements for a violation of 26 U.S.C. § 7201 are: (1) existence of a tax deficiency; (2) an affirmative act constituting an evasion or an attempted evasion of the tax; and (3) willfulness. United States v. Nolen, 472 F.3d 362, 377 (5th Cir. 2006).