United States v. Ashley Walkes ( 2011 )

Case: 09-41295 Document: 00511375226 Page: 1 Date Filed: 02/08/2011
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
February 8, 2011
No. 09-41295 Lyle W. Cayce
Clerk
UNITED STATES OF AMERICA,
Plaintiff - Appellee
v.
ASHLEY COLINWOOD WALKES,
Defendant - Appellant
Appeal from the United States District Court
for the Eastern District of Texas
No. 1:08-CR-159
Before KING, D EMOSS, and PRADO, Circuit Judges.
PER CURIAM:*
Appellant Ashley Walkes pleaded guilty to one count of misprision of a
felony in violation of 18 U.S.C. § 4. On appeal, he challenges the factual basis
supporting both the misprision conviction and the underlying felony of the
misprision conviction. He also challenges the voluntariness of his plea. Finally,
Walkes challenges the district court’s failure to properly advise him of his rights
pursuant to Federal Rule of Criminal Procedure Rule 11. Because we find that
*
Pursuant to 5TH CIR . R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR .
R. 47.5.4.
Case: 09-41295 Document: 00511375226 Page: 2 Date Filed: 02/08/2011
No. 09-41295
the district court did not plainly err in accepting Walkes’s guilty plea on the
challenged grounds, we affirm his conviction.
I.
Walkes was the operator and manager of Gulfway Medical Management
PA, known as Medic Management, a pain management clinic in Port Arthur,
Texas. Dr. Isam Anabtawi was the clinic’s doctor. Kristi Rose was the clinic’s
office manager and was responsible for coding claims to Medicare, Medicaid, and
private insurance companies. On December 2, 2003, a grand jury returned a 156
count indictment against Walkes, Anabtawi, Rose, and Medic Management for
health care fraud, conspiracy, making false statements, and money laundering.
Anabtawi entered into a pretrial diversion agreement with the government
whereby the charges against him and Medic Management were dropped.
Anabtawi was identified as a government witness. After the jury was empaneled,
but before opening arguments, Rose pleaded guilty to a misdemeanor of
conversion of health care benefit program funds. The next day, Walkes entered
a guilty plea pursuant to a written plea agreement to a one count information,
which charged him with misprision of a felony in violation of 18 U.S.C. § 4.
The “Factual Basis and Stipulation” alleged that Walkes had knowledge
that Medic Management committed a felony by fraudulently obtaining health
care benefit funds when it: (1) submitted Medicaid claims for physical therapy
sessions conducted by unlicenced persons; (2) billed single physical therapy
sessions as multiple physical therapy sessions; and (3) billed five minute
physician office visits as twenty-five minute physician office visits. The
information further alleged that Walkes concealed and failed to report these
fraudulent practices. At the plea hearing, Walkes stated that he understood the
elements of the offense and that he agreed to the factual basis. After Walkes had
pleaded guilty, but before the plea hearing concluded, the district court alerted
the parties that Walkes was a Canadian citizen and not a citizen of the United
2
Case: 09-41295 Document: 00511375226 Page: 3 Date Filed: 02/08/2011
No. 09-41295
States. Walkes’s attorney thus advised Walkes that a guilty plea could subject
him to deportation. Walkes stated that he wanted to proceed with his guilty plea
and the plea hearing was concluded. Walkes was sentenced to 36 months of
imprisonment and a one year term of supervised release. Walkes was ordered to
pay $4,900,256 in restitution.
On appeal Walkes challenges the sufficiency of the factual basis, the
voluntariness of his guilty plea, the effectiveness of his counsel, and the lack of
notice of his rights pursuant to Federal Rule of Criminal Procedure Rule 11. We
address each in turn.
II.
Walkes did not object to the sufficiency of the factual basis before the
district court, thus we review for plain error. See United States v. Vonn, 535
U.S. 55, 58-59 (2002). We will reverse only if Walkes can establish that “(1) there
is error, (2) the error is clear under current law, and (3) the error affects [his]
substantial rights.” United States v. Molina, 469 F.3d 408, 411 (5th Cir. 2006)
(citation omitted). To establish reversible plain error, Walkes must “show a
reasonable probability that, but for the error, he would not have entered the
plea.” Id. at 411-12 (quoting United States v. Dominguez Benitez, 542 U.S. 74, 82
(2004). When reviewing under a plain error standard, this court “may consult
the whole record when considering the effect of any error on substantial rights.”
Vonn, 535 U.S. at 59.
A district court cannot enter a judgment of conviction based upon a guilty
plea unless there is a factual basis for the plea. See F ED. R. C RIM. P. 11(b)(3). The
district court must determine that the factual conduct admitted by the defendant
was “sufficient as a matter of law to constitute a violation of the statute.” United
States v. Marek, 238 F.3d 310, 314 (5th Cir. 2001) (en banc) (italics omitted).
When determining the sufficiency of a factual basis, this court compares the
3
Case: 09-41295 Document: 00511375226 Page: 4 Date Filed: 02/08/2011
No. 09-41295
elements of the charged offense with facts admitted by the defendant in the
factual basis. See id. at 315.
Walkes argues that the factual basis was insufficient to establish his
knowledge and concealment of a felony and his failure to report the same. The
statute of conviction, misprision of a felony, provides:
Whoever, having knowledge of the actual commission of
a felony cognizable by a court of the United States,
conceals and does not as soon as possible make known
the same to some judge or other person in civil or
military authority under the United States, shall be
fined under this title or imprisoned not more than three
years, or both.
18 U.S.C. § 4 (2006). The elements of misprision of a felony include: (1)
knowledge that a felony was committed; (2) failure to notify the authorities of
the felony; and (3) an affirmative step to conceal the felony. United States v.
Adams, 961 F.2d 505, 508 (5th Cir. 1992).
The factual basis stipulated that while under his management Medic
Management submitted over 100,000 claims for health care benefit funds for
physical therapy sessions over a four year period. Medic Management required
Medicaid, Medicare, and private insurance patients to have eight physical
therapy sessions in order to refill prescriptions but did not require the same of
patients paying cash. The physical therapy sessions were billed at a physician’s
rate, but were actually performed by untrained, unlicensed, and unsupervised
personnel. Walkes further stipulated that Medicare, Medicaid, and Blue Cross
Blue Shield were billed for multiple sessions each time a patient attended a
single session. Walkes stipulated that the clinic billed thousands of physician
office visits at 25 minutes per visit when the visits lasted five minutes or less.
Walkes admitted that he worked three days per week and received $4,000,000
in cash or personal expenditures. Finally, Walkes stipulated that the evidence
4
Case: 09-41295 Document: 00511375226 Page: 5 Date Filed: 02/08/2011
No. 09-41295
would establish that he was aware of the fraudulent billing practices; that he
failed to take measures to report such practices; and that he actively concealed
the schemes by assuring employees who raised concerns about the clinic’s billing
practices that they were in compliance with Medicare and Medicaid regulations.
At the plea hearing, Walkes again stated that he was aware of and concealed the
fraudulent billing practices and failed to take measures to stop them. Under
these facts, Walkes has not established an insufficient basis to support the
charge of misprision of a felony.
Walkes also contends that the factual basis was insufficient to establish
that an underlying felony was committed. The underlying felony, health care
fraud, requires the knowing and willful execution, or attempted execution, of a
scheme “(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.” 18 U.S.C. § 1347(a) (2006).
Walkes asserts that the factual basis failed to establish a felony with
respect to the physical therapy sessions being performed by “unsupervised”
personnel because such a practice is within the scope of the Federal Code of
Regulations, which provides that the physician need not provide direct
supervision when the therapy is performed. See 42 C.F.R. § 410.32(b)(3)(ii)
(2007). However, as Walkes acknowledged, the individuals conducting the
physical therapy sessions were not merely unsupervised, but were also
untrained and unlicensed. Because the allegations of fraud were not limited to
the use of unsupervised personnel, § 410.32(b)(3)(ii) does not sanction the
conduct stipulated to in the factual basis.
Walkes also asserts that the factual basis established only improper
billing, which does not rise to the level of a felony. However, the factual basis
5
Case: 09-41295 Document: 00511375226 Page: 6 Date Filed: 02/08/2011
No. 09-41295
specifically identified the billing activities as fraudulent as required by the
statute. See 18 U.S.C. § 1347. Further, Walkes “acknowledge[d] and agree[d]
with the government’s summary of the facts constituting proof of the commission
of the offense and the charges against [him] in the indictment in every respect.”
The factual basis was sufficient to establish the elements of misprision and the
underlying felony. As such Walkes has failed to establish that the district court
committed plain error in accepting his guilty plea.
III.
Walkes next argues his guilty plea was not entered voluntarily and
knowingly because he was unaware that he faced deportation. Walkes also
argues that because he was not adequately advised of his risk of deportation he
received ineffective assistance of counsel, rendering his plea involuntary. See
Padilla v. Kentucy, 130 S. Ct. 1473, 1486 (2010). Because Walkes did not raise
these issues before the district court, we review whether his guilty plea was
involuntary for plain error. See Vonn, 535 U.S. at 58-59. We may reverse only if
(1) there is error, (2) that is clear and (3) affects Walkes’s substantial rights. See
Molina, 469 F.3d at 411. Walkes must show by a reasonable probability that but
for the error he would have not entered a guilty plea. See id. at 411-12.
A.
After Walkes had pleaded guilty, but before the plea hearing concluded,
the district court notified the parties that Walkes was not a citizen of the United
States. Having been previously unaware that Walkes was not a citizen, defense
counsel asked the court for “a minute to talk to [Walkes] because there [are]
admonishments that I need to talk to him about.” The district court granted his
request and defense counsel and Walkes had a discussion off the record. After
the proceedings resumed, the following exchange occurred:
DEFENSE COUNSEL: I have now admonished you
that the consequences of entering this plea [ ] could be
6
Case: 09-41295 Document: 00511375226 Page: 7 Date Filed: 02/08/2011
No. 09-41295
deportation and denial of access into the United States.
You understand that?
WALKES: Yes, sir.
DEFENSE COUNSEL: You still want to proceed with
your plea even though you know this?
WALKES: Yes, sir.
DEFENSE COUNSEL: Okay. You fully understand this
and the plea was voluntary, no threats or promises
have been made in reference to your rights in this
[c]ountry or being deported back?
WALKES: No, sir.
The district court then asked the parties if “everything was ready to go.” After
both parties indicated their satisfaction, the plea hearing was concluded.
Walkes argues that because he had pleaded guilty prior to the above
exchange, he was not aware that he was facing deportation and thus he did not
receive full and complete information with respect to his decision to plead guilty.
We need not determine whether it was error for the district court to accept
Walkes’s guilty plea entered prior to the court raising the issue of his citizenship
because, even if it were, such error is not clear under these facts. Walkes argues
that he “did not know” he was subject to deportation when he pleaded guilty.
However, before the plea hearing was concluded, Walkes was advised by his
attorney that his immigration status could result in deportation. Walkes was
asked in open court whether he wanted to proceed with his guilty plea in light
of this information, and Walkes responded “yes.” There is no indication that the
district court would not have permitted Walkes to withdraw his plea should the
possibility of deportation have changed his mind. Indeed, it was the district court
that raised the possibility that Walkes’s immigration status could affect the plea
7
Case: 09-41295 Document: 00511375226 Page: 8 Date Filed: 02/08/2011
No. 09-41295
proceedings. As such, we find no reversible error in the district court’s
acceptance of Walkes’s guilty plea on this basis.
B.
Walkes further argues that his guilty plea was involuntary because his
counsel rendered ineffective assistance. We have previously held that an
ineffective assistance of counsel claim “is not reviewable on direct appeal
because it has not been addressed by the district court, and the record has not
been fully developed.” United States v. Sevick, 234 F.3d 248, 251 (5th Cir. 2000)
(citation omitted); see also United States v. London, 568 F.3d 553, 562 (5th Cir.
2009) (“The general rule in this circuit is that a claim of ineffective assistance of
counsel cannot be resolved on direct appeal when the claim has not been before
the district court since no opportunity existed to develop the record on the merits
of the allegation.”) (citations omitted); United States v. Gordon, 346 F.3d 135,
137 (5th Cir. 2003) (noting that it is a “rare case” where the record on direct
appeal is adequate such that this court can consider an ineffective assistance
claim). This is particularly applicable to the present circumstances as the
discussion between Walkes and his counsel occurred off the record. We find that
Walkes’s inassistance of counsel claim is not properly before this court. Our
finding is without prejudice to Walkes’s ability to raise the issue in a § 2255
motion.1
IV.
In his final point of error, Walkes argues that the district court violated
Federal Rule of Criminal Procedure Rule 11 by failing to advise him of his right
to be (1) represented by counsel at all stages of the proceedings, and (2) protected
from compelled self-incrimination. See F ED. R. C RIM. P. 11(b)(1)(D), (E). Because
Walkes raised this issue for the first time on appeal we review for plain error,
1
We note that Walkes has since been approved for citizenship, however we need not
determine its effect on the proceedings as his claim is not properly before this court.
8
Case: 09-41295 Document: 00511375226 Page: 9 Date Filed: 02/08/2011
No. 09-41295
which requires Walkes to establish (1) error (2) that is clear and (3) that affected
his substantial rights. See Molina, 469 F.3d at 411. To reverse on the basis of a
district court’s Rule 11 error, Walkes “must show a reasonable probability that,
but for the error, he would not have entered the plea.” Dominguez Benitez, 542
U.S. at 83.
During the plea hearing, the district court informed Walkes of his right to
assistance of counsel, including appointed counsel, if he proceeded to trial. See
F ED. R. C RIM. P. 11(b)(1)(D). However, the district court did not fully instruct
Walkes of his right to be free from compelled self-incrimination. See id. at
11(b)(1)(E). Walkes argues that because his plea was involuntary and because
he received ineffective assistance of counsel, when “coupled with” the district
court’s failure to instruct him pursuant to Rule 11 “it is reasonable to assume
that Mr. Walkes would not have plead[ed] guilty.” This conclusory argument is
insufficient to demonstrate a reasonable probability that, but for the Rule 11
error Walkes would not have entered a guilty plea. See Dominguez Benitez, 542
U.S. at 83. As such, Walkes has not shown reversible error on these grounds.
V.
For the foregoing reasons, we affirm Walkes’s conviction pursuant to his
guilty plea.
AFFIRMED.
9