United States v. Wheeler , 889 F. Supp. 2d 64 ( 2012 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
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UNITED STATES OF AMERICA, )
)
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v. ) Criminal No. 11-0151(ESH)
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JACQUELINE L. WHEELER, )
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Defendant. )
___________________________________ )
MEMORANDUM OPINION AND ORDER
On July 13, 2012, after an eight-day trial, a jury convicted Jacqueline L. Wheeler of one
count of health care fraud, in violation of 18 U.S.C. § 1347 (Count 1), and thirty-four counts of
false statements relating to health care matters, in violation of 18 U.S.C. § 1035 (Counts 2
through 35).1 The convictions were based on bills that she had submitted to the District of
Columbia Medicaid program for payment for services which she claimed to have provided to
D.C. Medicaid beneficiaries between January 2006 through April 2008. Pending before the
Court are defendant’s motions for acquittal and new trial under Rules 29 and 30 and dismissal of
Counts 2 through 35 as multiplicitous. For the reasons stated herein, defendant’s motions will be
denied.
ANALYSIS
I. RULE 29
Rule 29(a) of the Federal Rules of Criminal Procedure provides that “[i]f the jury has
returned a guilty verdict, the court may set aside the verdict and enter an acquittal.” In reviewing
1
For all counts, defendant was also charged under 18 U.S.C. § 2(b), which provides for liability
as a principal for whoever “willfully causes an act [which is an offense to the United States] to
be done.”
a post-verdict motion for judgment of acquittal under Rule 29, a court “must view the evidence
in the light most favorable to the verdict.” United States v. Campbell, 702 F.2d 262, 264 (D.C.
Cir. 1983). A motion for a judgment of acquittal should be denied when the evidence is
“sufficient to permit a rational trier of fact to find all the essential elements of the crime beyond a
reasonable doubt. Typically, the jury’s determination will stand unless no reasonable juror could
have found a defendant guilty beyond a reasonable doubt.” United States v. Cook, 526 F. Supp.
2d 10, 18 (D.D.C. 2007), aff’d, 330 Fed. Appx. 1, 2 (D.C. Cir. 2009) (internal citations and
quotation marks omitted).
Defendant moves pursuant to Rule 29(c) for a judgment notwithstanding the jury’s
verdict on all counts. She argues that the evidence presented at trial did not support the inference
that she “‘knowingly and willfully’ intended to defraud D.C. Medicaid, as is required under both
§ 1347 and § 1035.” (Def.’s Mot. at 2.)
In “most cases in which the defendant’s state of mind is at issue, it may be near
impossible to establish the requisite mens rea through direct evidence” and therefore proof of
intent must be inferred from circumstantial evidence. United States v. Schaffer, 183 F.3d 833,
843 (D.C. Cir. 1999) (citing, inter alia, Chedick v. Nash, 151 F.3d 1077, 1083 (D.C. Cir. 1998)
(despite absence of smoking gun, jury entitled to infer intent to defraud from circumstantial
evidence)). In a § 1347 case, “‘intent [to defraud] can be inferred from efforts to conceal the
unlawful activity, from misrepresentations, from proof of knowledge, and from profits.’” United
States v. Dearing, 504 F.3d 897, 901 (9th Cir. 2007) (quoting United States v. Davis, 490 F.3d
541, 549 (6th Cir. 2007)); see also United States v. Jemal, No. 05-0359, 2007 U.S. Dist. LEXIS
21356, at *17-20 (D.D.C. Mar. 12, 2007).
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In this case, the government presented compelling circumstantial evidence to support the
conviction. It showed that defendant was the Chief Executive Officer and an owner of the
Health Advocacy Center (“HAC”), the registered D.C. Medicaid provider, during the relevant
time period. As defendant concedes, it showed that “Wheeler was responsible for the majority if
not all of the [D.C. Medicaid] billing” on behalf of HAC. (Def.’s Mot. at 5.) Moreover, multiple
witnesses testified that she controlled financial matters and was the only person who prepared
and submitted claims to D.C. Medicaid.
The evidence also showed that hundreds of false claims were submitted, on behalf of
HAC, to D.C. Medicaid for manual therapy services. Some of these claims were for services that
could not have been rendered to patients because they were not at HAC, but rather were
hospitalized at another facility. In other cases, bills were submitted that made “impossible”
claims, i.e., that twenty-four hours of massage therapy had been provided to a single patient in
one day. The government also introduced bills that had been submitted for services that HAC
could not provide, because, according to some of the witnesses, HAC did not have the necessary
equipment.
The government presented evidence that HAC received more than $3 million for
approximately 600 false manual therapy claims submitted during the time period covered by the
indictment. This money was deposited into bank accounts controlled by Wheeler. It also
presented evidence that Wheeler purchased numerous cars and attempted to buy property in
Florida. While defendant argues that these expenditures were not lavish (Def.’s Reply at 5), she
cannot seriously dispute that she personally benefitted financially from receipt of the millions of
dollars in unearned D.C. Medicaid funds. See United States v. Bradley, 644 F.3d 1213, 1247
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(11th Cir. 2011) (receipt of disproportionate profits from scheme permits inference of intent to
defraud).
Finally, the jury heard testimony that would allow it to conclude that Wheeler intended to
conceal her billing practices. For example, Acquinette Robinson testified that Wheeler refused
to let special agents enter the Sheridan Office and, at 4:00 a.m. the following morning, she
moved all the patient files from HAC to her home in Chevy Chase, Maryland. From this
testimony, the jury could infer that Wheeler intended to hide information—or conceal the
absence of any supporting documentation—relating to her Medicaid claims.
Moreover, defendant’s Rule 29 challenge rests primarily on disputed issues of fact—
whether HAC had the necessary equipment for certain services; whether any other HAC
employees ever submitted bills; whether Wheeler actually reviewed bills rather than merely
submitted them; and whether her sudden removal of patient files from the HAC facility suggests
an intent to conceal fraudulent billing. (See Def.’s Mot. at 4-5; Def.’s Reply at 3-5). 2 However,
the existence of disputed factual issues is not grounds to overturn a jury’s verdict. Ultimately,
the evidence admitted at trial and the inferences that can be drawn therefrom were sufficient for a
jury to find that the defendant had the requisite knowledge and intent to defraud the D.C.
Medicaid program. Even if the resolution of factual disputes was a close call (which it was not),
“‘the evidence reasonably permits a verdict of acquittal or a verdict of guilt, in which case the
2
Defendant’s argument that the facts in his case are distinguishable from Dearing, 504 F.3d 897,
and other health care fraud convictions is unavailing. See Choiniere v. United States, No. 3:07-
cv-27RM, 2009 U.S. Dist. LEXIS 3314, at *31 (N.D. Ind. Jan. 14, 2009) (“[These cases] do[n’t]
stand for the proposition that the only way to establish the willfulness element is to prove that the
defendant had been notified that his conduct was unlawful and yet continued to engage in that
conduct.”). Whether the evidence in those cases is present in this case is not the issue; rather, it
is whether the evidence here supports the jury’s verdict, which it does.
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decision was for the jury to make.’” United States v. Cabrera, 734 F. Supp. 2d 66, 87 (D.D.C.
2010) (quoting United States v. Curley, 160 F.2d 229, 237 (D.C. Cir. 1947)).
II. RULE 33
Federal Rule of Criminal Procedure 33 permits “a court [to] vacate any judgment and
grant a new trial if the interest of justice so requires.” Fed. R. Crim. P. 33(a). “The Rule does not
define ‘interests of justice’ and the courts have had little success in trying to generalize its
meaning.” United States v. Cabrera, 734 F. Supp. 2d 66, 87 (D.D.C. 2010) (quoting United
States v. Kuzniar, 881 F.2d 466, 470 (7th Cir. 1989)). “Nevertheless, courts have interpreted the
rule to require a new trial ‘in the interests of justice’ in a variety of situations in which the
substantial rights of the defendant have been jeopardized by errors or omissions during trial.” Id.A defendant has a heavy burden under Fed. R. Crim. P. 33(a). “[T]he evidence must
preponderate heavily against the verdict, such that it would be a miscarriage of justice to let the
verdict stand . . . . This power should be exercised with caution, and is invoked only in those
exceptional cases in which the evidence weighs heavily against the verdict.” United States v.
Howard, 245 F. Supp. 2d 24, 30 (D.D.C. 2003) (quoting United States v. Edmonds, 765 F. Supp.
1112, 1118 (D.D.C. 1991) (omission in original)).
Defendant argues that a new trial is warranted based on “the government’s deliberate
misconduct,” meaning two statements from government witnesses during their testimony at trial
and an “inflammatory” statement by the government in its closing argument. (Def.’s Reply at 9.)
Specifically, defendant refers to (1) a single remark made by Michael Kirk in which he stated
that he engaged in document forgery on behalf of the defendant; (2) a possible inference of
Social Security fraud based on Dr. Sheila Jones’s testimony; and (3) the government’s
suggestion, in closing argument, that taxpayers funded defendant’s lavish lifestyle through
Medicaid funds.
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Even when considered collectively, these statements do not warrant a new trial.
First, it is flatly incorrect to describe the witness statements as the product of “deliberate
misconduct.” (Def.’s Reply at 9; see Def.’s Mot. at 10, 11.) The government did not elicit either
statement, and it ensured that Kirk did not mention anything like that again.
Second, any possible prejudice from these witness statements or the government’s
closing was mitigated by the Court, which gave strong curative instructions immediately after
each statement. Following Mr. Kirk’s statement, the Court struck the testimony and gave a
curative instruction. Similarly, following Ms. Jones’ statement—which merely could have given
rise to an inference of improper use of Social Security checks—the Court instructed the jury that
“there’s no suggestion there’s been any impropriety regarding any of these . . . checks.” (Trial
Tr. vol.4, 92:9-92:12, July 6, 2012.) Finally, after the government’s reference to the American
taxpayer in closing argument, the Court, using defendant’s proposed instruction, ordered the jury
to disregard the government’s statement. Since it is presumed that the jury followed the Court’s
instructions, see United States v. Foster, 557 F.3d 650, 655 (D.C. Cir. 2009) (“We normally
presume that a jury will follow an instruction to disregard inadmissible evidence inadvertently
presented to it[.]”), these statements cannot have impacted the verdict.
Third, “a new trial should be granted only if the defendant has shown that the error was
substantial, not harmless, and that the error affected the defendant’s substantial rights.” United
States v. Williams, 825 F. Supp. 2d 128, 132 (D.D.C. 2011) (internal quotation marks omitted).
“An error affecting ‘substantial rights’ must have a ‘substantial and injurious effect or influence
in determining the . . . verdict.’” United States v. Lawson, 494 F.3d 1046, 1053 (D.C. Cir. 2007)
(quoting United States v. Dominguez Benitez, 542 U.S. 74, 81 (2004)).
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Given the strength of the government’s case (see supra Section I), there is no basis to
find that the three immediately-corrected statements to which defendant objects had a substantial
effect on the verdict. See United States v. Johnson, 231 F.3d 43, 47 (D.C. Cir. 2000) (observing
that, in analyzing prosecution’s misstatements, the court may consider “the closeness of the case,
the centrality of the issue affected by the error, and the steps taken to mitigate the effects of the
error”) (citing Gaither v. United States, 413 F.2d 1061, 1079 (D.C. Cir. 1969)). However, the
Court recognizes that “[t]he inquiry cannot be merely whether there was enough evidence to
support the result, apart from the phase affected by the error. It is rather, even so, whether the
error itself had substantial influence.’” United States v. Pineda, 592 F.3d 199, 200 (D.C. Cir.
2010) (quoting Kotteakos v. United States, 328 U.S. 750, 765 (1946). Although the
government’s comment in closing argument was ill-chosen, it was hardly “incendiary,” as
defendant has suggested. (Def.’s Reply at 9.) Therefore, even assuming arguendo that the
errors had some effect notwithstanding the curative instructions, the Court finds that they could
not have had a substantial influence on the jury.
Defendant also argues that a new trial is warranted under Rule 33 because, as she asserted
in her Rule 29 motion, there was insufficient evidence to support the jury’s verdict. (See Def.’s
Mot. at 13.) For the reasons that this argument fails under Rule 29 (see supra Section I), it also
fails under Rule 33.
III. MULTIPLICITY
The Double Jeopardy Clause of the Fifth Amendment “protects [defendants] against
multiple punishments for the same offense.” North Carolina v. Pearce, 395 U.S. 711, 717 (1969)
(footnotes omitted). If a single offense is alleged in a number of counts, “[a]n indictment is
multiplicitous, and thereby defective.” United States v. Harris, 959 F.2d 246, 250 (D.C. Cir.
1992). As the Supreme Court explained in Blockburger v. United States, 284 U.S. 299, 304
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(1932), “where the same act or transaction constitutes a violation of two distinct statutory
provisions, the test to be applied to determine whether there are two offenses or only one, is
whether each provision requires proof of a fact which the other does not.” The Blockburger test
requires a “comparison of the statutorily-prescribed elements of the offenses, not the constituent
facts either alleged or proven.” United States v. Coachman, 727 F.2d 1293, 1301 (D.C. Cir.
1984) (footnote omitted).
Defendant was indicted for fraudulent billing practices in violation of two statutes: §
1347 (health care fraud) and § 1035 (false statements relating to health care matters). She has
moved to dismiss all counts under § 1035 (Counts 2 through 25), arguing that they are
multiplicitous of the single charge of health care fraud under § 1347 (Count 1).3
To prove a violation of § 1347, the government must show: (1) that the defendant
executed or attempted to execute; (2) a scheme; (3) to defraud a health care benefit program
which affects commerce or to obtain any money or property owned by or under the custody and
control of a health care benefit program which affects commerce, by means of false or fraudulent
pretenses, representations, or promises which were material; (4) in connection with the delivery
of or payment for health care benefits, items, or services; and (5) that the defendant did so
knowingly and willfully. (Final Jury Instructions at 20, U.S. v. Wheeler, 11-cr-151 (July 13,
2012) (“Jury Instr.”).) To prove a violation of § 1035, the government must show: (1) that the
defendant made a materially false, fictitious, or fraudulent statement or representation or made or
3
Defendant filed a pre-trial motion to dismiss Counts 2 through 35 as multiplicitous, which is
incorporated by reference in its renewed motion. (See Def.’s Mot. at 7) (incorporating Def.’s
Mot. to Dismiss Counts 2 Through 40 as Multiplicitous (“Def.’s Pretrial Mot.”) ).) The Court
denied defendant’s pretrial motion without prejudice since “‘multiplicity claims are better sorted
out post-trial.’” United States v. Wheeler, No. 11-cr-151, 2012 U.S. Dist. LEXIS 70837, at *4
(D.D.C. May 22, 2012) (quoting United States v. Hubbell, 177 F.3d 11, 14 (D.C. Cir. 1999)
(alternation omitted).)
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used a materially false writing or document; (2) in connection with the delivery of or payment
for health care benefits, items, or services involving a health care benefit program; and (3) that
the defendant did so knowingly and willfully. (Jury Instr. at 22.)
Defendant concedes that § 1347 requires proof of a fact—the existence of a “scheme”—
that § 1035 does not. (See Def.’s Pretrial Mot. at 6.) She argues, however, that “§ 1035 does
not have any unique elements of proof from § 1347” because a conviction under § 1347 “by
definition, entails the making of some false, fraudulent, or misleading statement in order to
perpetrate that fraud.” (Def.’s Mot. at 7.) However, that is simply not so.
For the purposes of § 1347, a “scheme to defraud” can be committed through a plan,
pattern or course of action involving . . . a pretense, representation, or promise . . . .” (See Jury
Instr. at 20.) Therefore, to obtain a conviction under § 1347, the government was not required to
show that a false statement was made at all. Moreover, even if a false statement had been made,
the government did not have to show that defendant made the statement, but only that she
“executed or attempted to execute” a scheme “involv[ing]” it. (Jury Instr. at 2; see § 1347.) By
contrast, to prove Counts 2 through 35, the government had to show that the defendant actually
made a false statement or representation or that she made or used a document containing a false
statement. (See § 1035; Jury Instr. at 22.) This element is not required under § 1347. Thus,
each offense requires proof of an element that the other does not. See United States v. Sachakov,
812 F. Supp. 2d 198, 209 (E.D.N.Y. 2011).
While this is a matter of first impression in this Circuit and the Court is not aware of any
case that is precisely on point, the Court finds support for its analysis in a similar inquiry into
whether bank fraud, under 18 U.S.C. § 1344, is multiplicitous of the crime of making false
statements to a federal lender, under 18 U.S.C. § 1014. Numerous circuits have analyzed those
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statutes and found that they satisfy the Blockburger test since § 1344 requires proof of a “scheme
or artifice to defraud” and § 1014 requires proof of a false statement, neither of which is required
by the other. See United States v. Fraza, 106 F.3d 1050, 1054 (1st Cir. 1997) (“Because it is
possible to violate either statute without violating the other, we believe the best view is that these
two counts are not multiplicitous.”); United States v. Nash, 115 F.3d 1431, 1438 (9th Cir. 1997)
(“Although there are probably few cases of bank fraud that do not involve making a false
statement to a federally insured institution, section 1014 requires that the statement be made to
influence action on a loan. The bank fraud statute, which is written more broadly, technically
does not.”); accord United States v. Abu-Shawish, 175 Fed. Appx. 41, 44 (7th Cir. 2006); United
States v. Chacko, 169 F.3d 140, 147 (2d Cir. 1999); United States v. Dupre, 117 F.3d 810, 818
(5th Cir. 1997). The apparent consensus that these statutes do not violate Blockburger reinforces
the conclusion that the counts here are not multiplicitous.
Moreover, even if § 1035 were a lesser included offense of § 1347, that would not end
the inquiry, because “punishments may be imposed for both ‘if Congress intended that they be
imposed.’” United States v. White, 116 F.3d 903, 932 (D.C. Cir. 1997) (quoting United States v.
Baker, 63 F.3d 1478, 1494 (9th Cir. 1995)). As the Court noted in its prior opinion, the fact that
Congress created two distinct offenses in the United States Code raises the presumption that it
intended to permit cumulative punishments. Wheeler, 2012 U.S. Dist. LEXIS 70837, at *3-4;
see Harris, 959 F.2d at 251-52; Sachakov, 812 F. Supp. 2d at 208-09. Absent evidence to the
contrary, the Court would have to conclude that Congress intended for cumulative punishments.
Therefore, defendant’s motion to dismiss Counts 2 through 35 is denied.
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CONCLUSION
For the foregoing reasons, the Court denies defendant’s motion for acquittal, motion for
dismissal of Counts 2-35 as multiplicitous, and motion for a new trial [ECF No. 55] .
/s/
ELLEN SEGAL HUVELLE
United States District Judge
Date: September 5, 2012
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