United States v. Hakop Gambaryan , 654 F. App'x 888 ( 2016 )

FILED
NOT FOR PUBLICATION
JUL 05 2016
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 15-50258
Plaintiff - Appellee, D.C. No. 2:14-cr-00249-ODW-1
v.
MEMORANDUM*
HAKOP GAMBARYAN,
Defendant - Appellant.
Appeal from the United States District Court
for the Central District of California
Otis D. Wright, II, District Judge, Presiding
Argued and Submitted June 9, 2016
Pasadena, California
Before: REINHARDT and WARDLAW, Circuit Judges, and KORMAN,** District
Judge.
Hakop Gambaryan (“Gambaryan”) was convicted after trial of billing Medicare
for power wheelchairs he provided to Medicare beneficiaries for whom the devices
were not medically necessary, in violation of 18 U.S.C. § 1347(a). At sentencing, the
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The Honorable Edward R. Korman, Senior District Judge for the U.S.
District Court for the Eastern District of New York, sitting by designation.
district judge found that over $2.5 million of Gambaryan’s total Medicare billings
were fraudulent. The application of the then-applicable Sentencing Guidelines for
cases in which the intended loss exceeds $2.5 million, U.S.S.G. § 2B1.1(b)(1)(J)
(2014), along with an additional enhancement we discuss below, id. § 2B1.1(b)(7),
resulted in a Guidelines range of sixty-three to seventy-eight months.
The district judge imposed a sentence of eighty-four months, after considering
the factors set out in 18 U.S.C. § 3553(a) and “evaluat[ing] the various kinds of
sentences available as well as the Guidelines sentencing range.” While Gambaryan
does not challenge the substantive reasonableness of the sentence, he does argue that
the district judge erred in calculating the appropriate Guidelines range. Because the
Guidelines must be correctly calculated—if they are to be taken into account, as they
must be, in determining an appropriate sentence under § 3553(a)—and because we
hold that the district judge did not do so, we vacate the sentence and remand for
resentencing on an open record.
1. Gambaryan argues that the enhancement was not supported by clear and
convincing evidence of the amount of loss. Considering only the loss relating to the
instances of fraud for which Gambaryan was convicted would have led to a Guidelines
range of six to twelve months. See U.S.S.G. § 2B1.1(b)(1)(C) (2014). The disputed
sentencing enhancements increased this range to sixty-three to seventy-eight months.
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See id. § 2B1.1(b)(1)(J). We have held that “facts found in support of Guidelines
enhancements that turn out to have a disproportionate impact on the ultimate sentence
imposed [must] be established by clear and convincing evidence,” rather than the
otherwise applicable preponderance of the evidence standard. United States v. Staten,
466 F.3d 708, 720 (9th Cir. 2006). Indeed, “where a severe sentencing enhancement
is imposed on the basis of uncharged or acquitted conduct, due process may require
clear and convincing evidence of that conduct.” United States v. Treadwell, 593 F.3d
990, 1000 (9th Cir. 2010). Based on this consideration and others applicable in these
circumstances, see id., we hold that the loss enhancement was required to rest on clear
and convincing evidence.
This standard has not been met. First, although Gambaryan billed Medicare for
$3,370,200, only $2,541,805 of those claims were for power wheelchairs.
Nevertheless, the record is unclear as to the manner in which the district judge arrived
at the loss calculation of over $2.5 million. Indeed, the PSR calculated the loss as
between $1 million and $2.5 million and, when granting bail pending appeal, the
district judge observed that he was understandably troubled by the fact that “we could
[not] quantify how many of the total claims submitted were fraudulent.” There was
an exceedingly narrow margin dividing a sentencing enhancement for intended loss
exceeding $1 million and the enhancement for loss exceeding $2.5 million. The
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$41,805 difference works out to be about eight or nine wheelchairs out of
approximately 300, or about three percent of the power wheelchair claims.
More significantly, the evidence at trial was not sufficiently clear and
convincing to justify the assumption that nearly the entire amount billed for power
wheelchairs was fraudulent. To cite just one of a number of examples, of the 123
doctors whose prescriptions for power wheelchairs Gambaryan filled, only thirty-four
were listed in a Medicare database as having been compromised—meaning that they
were “identified as . . . fraudulent providers . . . [for] billing abusively or having
reported that their [National Provider Identification] numbers were stolen.” While this
evidence may have been sufficient to support the inference that all of the prescriptions
written by these thirty-four compromised doctors were fraudulent, there was
concededly no evidence that any of the other eighty-nine prescribing doctors were
compromised. Significantly, even as to the compromised doctors, the record does not
reveal the number of power wheelchair claims that were predicated on prescriptions
written by these doctors.
Nor does our holding in United States v. Popov, 742 F.3d 911 (9th Cir. 2014),
compel a contrary result. There, it was assumed that all of the claims submitted to
Medicare were fraudulent. The defendants argued, however, that, “[b]ecause it is well
known that Medicare routinely pays much less than the billed amount, . . . the district
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court should have calculated the intended loss based on the amounts actually paid by
Medicare.” Id. at 915. We rejected this argument for reasons upon which we need not
dwell here. Id. at 915–16. Unlike Popov, in this case the threshold issue is whether
all of the claims submitted to Medicare for power wheelchairs were fraudulent, and
not whether, if they were fraudulent, the intended loss was the amount Medicare paid.
In sum, we have held that a district judge “need not make [his or her] loss
calculation with absolute precision [and] need only make a reasonable estimate of the
loss based on the available information.” United States v. Zolp, 479 F.3d 715, 719
(9th Cir. 2007) (citing U.S.S.G. § 2B1.1 cmt. n.3(C)). Nevertheless, where the
difference between a sentencing enhancement rests on $41,805 out of $2,541,805 in
total claims (or approximately eight or nine wheelchairs), and where the available
information in the record is insufficient to establish that all (or almost all) the claims
filed were fraudulent, we are unable to conclude that the estimated loss was
reasonable. We remand on an open record so that, if the Department of Justice wishes
to press for the higher enhancement based on a loss of over $2.5 million—rather than
an enhancement based on loss exceeding $1 million, which the trial record
supports—it will have the opportunity to come forward with additional evidence,
perhaps by finally opening the boxes of files Gambaryan produced pursuant to a
subpoena on the first day of trial. Moreover, contrary to Gambaryan’s suggestion, the
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district judge is not limited to the counts of conviction. Nor do we suggest that the
factors set out in 18 U.S.C. § 3553(a), upon which the district judge previously relied,
would not warrant a sentence greater than the applicable Guidelines range.
Nevertheless, before such a sentence can be imposed, the applicable Guidelines range
must be accurately calculated.
2. Gambaryan also argues that increasing his Guidelines range for defrauding
a federal health care program more than $1 million violated the Ex Post Facto Clause.
Gambaryan’s base offense level was increased by two steps pursuant to
U.S.S.G. § 2B1.1(b)(7) (2014). This specific offense characteristic was added to the
Sentencing Guidelines in November 2011, after Gambaryan committed the offenses
charged in the indictment. See U.S.S.G. app. C vol. III amend. 749 (2011). We agree
with the Department of Justice that this requires the sentence to be vacated. See
Peugh v. United States, 133 S. Ct. 2072, 2084 (2013). Nevertheless, Gambaryan’s
success on this issue may possibly be canceled out by United States v. Adebimpe, 819
F.3d 1212 (9th Cir. 2016), which was decided while this appeal was pending and
which held that a two-step increase for abusing a position of trust could apply in these
circumstances, id. at 1214—an increase the district judge initially rejected.
VACATED AND REMANDED.
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