Health Care Fraud Conspiracies that Overlap in Time, Place, Personnel, and Statutory Charge Don't Violate Double Jeopardy Since Government Sought to Punish Different Activity

United States v. Njoku, No. 12-20095 (5th Cir. Dec. 2, 2013) (Dennis, Clement, Southwick)

Four defendants were convicted on numerous counts related to committing health care fraud, receiving or paying healthcare kickbacks, and/or making false statements for use in determining rights Medicare benefits and payments.  The panel affirms the convictions and sentences but remands to the district court to amend Njoku’s written sentence of 63 months to conform with the oral sentence of 60 months.

The panel finds the Government presented sufficient evidence that Njoku knew of the unlawful purpose of both the health care fraud conspiracy and the kickback conspiracy and that she joined in those agreements willfully.  She also challenges the two conspiracy counts as multiplicitous.  (Since she did not object to the indictment as multiplicitous, the convictions stand but the sentences can be challenged under plain error review.)  Njoku argues that her health care fraud conspiracy conviction was based entirely on proof of the kickback conspiracy, so the kickback conspiracy is a lesser included of the health care fraud conspiracy.  The panel disagrees, noting that one conspiracy is under 18 U.S.C. § 1349 (proof of conspiracy to commit fraud and that fraud is the object of the conspiracy) and the other under 18 U.S.C. § 371 (proof of conspiracy against United States and the commission of an overt act).  Further, the indictment described the unlawful purpose of the health care conspiracy as the receipt of kickbacks in addition to the submission of fraudulent claims to Medicare.

Defendant Ellis challenges her trial on the of conspiracy to commit health care fraud as violating the Double Jeopardy Clause because she was acquitted of a conspiracy to commit health care fraud after a trial by jury prior to the instant indictment.  The first indictment focused on her activity as a recruiter and the other focused on her falsification of nursing notes and medical certifications.  Since she established a prima facie nonfrivolous double jeopardy claim, the Government bears the burden to prove by a preponderance of the evidence that she was charged in separate conspiracies.  The panel undertakes the five-prong test to determine whether there were two agreements and conspiracies.  It concludes that “the time, statutory offenses, and places involved suggest that there was one agreement.  Nevertheless, . . . two agreements and two conspiracies existed because of the separate functions that central co-conspirators provided in each scheme and the distinctive activity that the Government sought to punish in each case.” 

Ellis also argues that in her acquittal of the first charged conspiracy, the jury necessarily determined that she did not know her paid referrals were illegal, which she argues would bar any subsequent prosecution on whether she willfully received kickbacks.  The panel finds that the first jury could have based the acquittal either on Ellis not knowing that the paid referrals were illegal or on her not intending to further the unlawful purpose as charged in the indictment.  Since the jury did not have to necessarily find that she did not know the referrals were illegal, she was not twice put in jeopardy.

During trial, Ellis sought to introduce portions of testimony by a person, Clifford Ubani, who testified in the first trial that he never agreed with Ellis to do something unlawful but invoked his right against self-incrimination in the second trial.  The district court excluded this evidence finding its admission would require the admission of additional evidence in order to explain the statement in the proper context and would be more misleading or confusing than probative.  The panel also rejects Ellis’s argument that the district court’s ruling violated her Sixth Amendment right to present a complete defense.

With regard to sentencing, the panel affirms the loss amount calculated for Ellis, finding that the Government presented reliable evidence of actual loss and the district court properly considered Ellis’s contrary evidence.  The panel also affirms Ezinne Ubani’s enhancements as a manager/supervisor and abuse of trust, noting that “Medicare invests an important trust in RNs who complete OASIS questionnaires and certify plans of care for initial episodes of care and recertifications . . . .”