United States v. Chante Hayes ( 2009 )

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
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No. 08-2245
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United States of America, *
*
Appellee, *
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v. *
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Chante M. Hayes, *
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Appellant. *
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Appeals from the United States
No. 08-2296 District Court for the
___________ Eastern District of Missouri.
United States of America, *
*
Appellee, *
*
v. *
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Gwendolyn Silvers, *
*
Appellant. *
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Submitted: January 14, 2009
Filed: August 3, 2009
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Before LOKEN, Chief Judge, WOLLMAN and SHEPHERD, Circuit Judges.
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SHEPHERD, Circuit Judge.
Chante M. Hayes (“Hayes”) and Gwendolyn Silvers (“Silvers”), Hayes’s aunt,
were convicted by a jury of conspiracy to commit health care fraud in violation of 18
U.S.C. §§ 371, 1035, 1347 and 2 and one count of making a false statement relating
to health care matters in violation of 18 U.S.C. §§ 1035 and 2. In addition, Silvers
was convicted of nine additional counts of making false statements relating to health
care matters in violation of 18 U.S.C. §§ 1035 and 2; the jury found Hayes not guilty
of these offenses. The district court sentenced Hayes to 51 months imprisonment on
each count on which she was convicted, to be served concurrently, to be followed by
37 months supervised release. The district court also ordered Hayes to pay restitution
in the amount of $545,713. The district court sentenced Silvers to 51 months
imprisonment on each of the 13 counts on which she was convicted, to be served
concurrently, followed by three years supervised release. The district court also
imposed restitution of $545,713.
On appeal, Hayes contends that the district court erred by denying her: (1)
motion to dismiss all counts of the superceding indictment, (2) Batson challenge,1 (3)
objection to the deliberate ignorance jury instruction, (4) motion for judgment of
acquittal, and (5) challenges to sentencing enhancements for her role in the offense
and abuse of trust. We reverse the district court’s denial of Hayes’s motion for
acquittal on the false statement count and conclude that the district court clearly erred
in imposing the abuse of trust enhancement. We reject Hayes’s remaining
contentions. Silvers asserts that the district court erred in: (1) denying her motion for
1
Batson v. Kentucky, 476 U.S. 79, 96-98 (1986) (providing a three-part analysis
for determining whether a party impermissibly struck a potential juror on account of
race).
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judgment of acquittal, (2) its response to a question from the jury, and (3) determining
the total amount of loss attributable to her. We determine that none of Silvers’s
arguments warrant reversal, and we affirm.
I.
The Medicaid program was established in 1965 by Title XIX of the
Social Security Act (“the Act”), codified at 42 U.S.C. § 1396-1396v.
The primary purpose of the program is to provide federal financial
assistance to States that elect to reimburse certain costs of medical
treatment for needy individuals. States voluntarily agree to participate
in the program, but must comply with federal requirements once they do
so.
Ahlborn v. Ark. Dept. of Human Servs., 397 F.3d 620, 623 (8th Cir. 2005) (citation
omitted). “Missouri has elected to participate in the Medicaid program,” In re Estates
of Shuh, 248 S.W.3d 82, 84 (Mo. Ct. App. 2008), codifying its state program
(“Missouri Medicaid”) at Missouri Revised Statutes section 208.001 et seq. The State
of Missouri administers the Missouri Medicaid program through the Division of
Medical Services (DMS).2 The Missouri Department of Health and Senior Services,
Division of Senior and Disability Services (“DHSS”) administers the Missouri
Medicaid in-home services program. Mo. Code Regs. Ann. tit. 19, § 15-7.021.
DHHS monitors the performance of in-home services providers to ensure that they are
abiding by the Missouri Medicaid regulations. See id. § 15-7.010.
From the mid-1990s to the summer of 2005, Hayes and Silvers, along with
other family members, worked for varying periods of time in three family-owned
2
In the intervening time between the events giving rise to this case and this
appeal, DMS underwent a name change to the MO HealthNet Division. See Mo. Rev.
Stat. § 208.151.1; however, for purposes of this appeal, we will use the term “DMS”
to refer to the agency that administers the Missouri Medicaid program.
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health care agencies providing Missouri Medicaid in-home services: VIP Home
Services (“VIP”),3 Complete Care of America and International (“Complete Care”),
and Watkins Loving Care Homes Services (“Watkins Loving Care”). From 1999 to
about 2001, VIP and Complete Care were both operating. During 2002 and 2003,
Complete Care and Watkins Love Care conducted business at the same time. Some
clients were served by all three companies, and some employees worked for more than
one of the companies. Missouri Medicaid reimbursed VIP, Complete Care, and
Watkins Loving Care for in-home services that were purportedly provided to eligible
elderly and disabled persons.
On January 12, 2006, a federal grand jury returned a 22-count superceding
indictment against Hayes; Silvers; Jacqueline Hayes (“Jacqueline”), Hayes’s mother;
Sharon Johnson (“Johnson”), Silvers’s sister; Earlean Hopson (“Earlean”), Silvers’s
aunt and Hayes’s great aunt; Complete Care; and Watkins Loving Care. All of the
defendants were charged with participating in a health care fraud conspiracy in
violation of 18 U.S.C. §§ 371, 1035, 1347 and 2 (“count one”). They were also
charged with 12 substantive counts of making a false statement relating to health care
matters on various dates in violation of 18 U.S.C. §§ 1035 and 2 (“counts 2-13”).
Only Jaqueline was named in counts 14-22. Jacqueline, Johnson, and Earlean entered
into plea agreements with the government and pled guilty to count one; Jaqueline also
pled guilty to counts 14-20.
Hayes and Silvers moved to dismiss all of the counts against them, counts 1-13,
for lack of jurisdiction and failure to state an offense. The district court denied the
motion. The case proceeded to trial as to Hayes and Silvers only. Jury selection took
place on January 28, 2006. The district court denied defendants Batson challenge to
3
Thelma Hayes-Jacobs, the mother of Silvers and a co-conspirator, started VIP
in the mid-1990s and operated the company from her home in St. Louis County,
Missouri.
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the government’s peremptory strike of venire person 22, a female African-American.
The case proceeded to trial on January 29, 2006.
“We recite the facts in the light most favorable to the jury’s verdicts.” United
States v. Engler, 521 F.3d 965, 968 (8th Cir. 2008). In 1999, Jacqueline started
Complete Care. The Complete Care office was in Jacqueline’s home and, for a time,
in the Northland office building in St. Louis County. Jacqueline, Johnson, and Silvers
prepared the proposal for Complete Care to DHSS. The proposal listed Jacqueline
and Johnson as the owners of Complete Care and Hayes as the vice president. DHSS
approved Complete Care’s proposal to provide in-home services to clients. Two
written provider agreements between DHSS and Complete Care were in effect from
1998 to June 30, 1999, and from July 1999 to June 30, 2000. Barbara Reuter, a quality
assurance specialist with DHSS, testified that DHSS continued to deal with Complete
Care as a provider of in-home health services until July 2005. (Trial Tr. vol. II, 94.)
In addition to owning Complete Care, Jaqueline served as a supervisor. Silvers
was a supervisor at Complete Care and responsible for hiring and firing, training,
handling employee and client files, working with nurses, and supervising staff.
Complete Care documents also identify Silvers as “Administrator.” Hayes was a
supervisor at Complete Care and was responsible for receiving time sheets and billing.
In addition to Jaqueline, Silvers, and Hayes, some of the other individuals that worked
at Complete Care are as follows: Ruth White Buchanan (“Ruth”); Monica Silvers-
Smith (“Monica”), Silvers’s sister-in-law; Lawrence Hayes (“Lawrence”), Silvers’s
nephew and Hayes’s cousin; Earlean; Thelma Hayes-Jacobs (“Thelma”), Silvers’s
mother; Mary Young (“Young”), a longtime friend of Jacqueline; Lynette Hopson-
Bassette (“Lynette”), Silvers’s cousin; Theresa Hayes-Kirkland (“Theresa”), Silvers’s
sister and Hayes’s aunt; Sabrina Silvers (“Sabrina”), Silvers’s daughter and Hayes’s
cousin; Annie Norman (“Norman”), the daughter of Jacqueline’s ex-husband; and
Anthony Johnson (“Anthony”), Johnson’s husband. With the exception of Norman,
the district court determined that all of these individuals were the defendants’
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coconspirators, regardless of whether they were indicted or not, and the defendants do
not challenge this ruling on appeal. (See Trial Tr. vol. VI, 200-01.) The
coconspirators received immunity for their conduct related to this case in exchange
for their cooperation.
Ruth began working at VIP in 1998. While working there, Ruth performed in-
home health services for her husband, Silas Buchanan, even though she knew that
state regulations prohibited a personal care aid from providing services to a spouse.4
Thelma instructed Ruth to use her maiden name “White” on all paperwork that she
turned into VIP and use her nondriver’s identification bearing her maiden name.
Silvers was present when Thelma told Ruth to use her maiden name, and Silvers
instructed Ruth to use her maiden name on the time sheets that she completed for
services to her husband. Ruth did so for a number of years.
Before Ruth went to work at Complete Care, Hayes brought a Complete Care
application to Ruth’s house and told her to fill it out exactly as she had her application
at VIP. Ruth used her maiden name, “White,” on the Complete Care application, time
sheets, and other documents. She testified that she signed the name “White” on any
document associated with Complete Care. Ruth turned in her time sheets at the
Complete Care office on Northland to Hayes or whoever was in the office. Ruth
stated that she signed and submitted the 44 time sheets in Exhibit 268A. Each time
sheet reflected five days of services that she provided to her husband. Ruth again
stated that she used the name “White” on the time sheets because she knew that
Missouri Medicaid would not pay for services a wife rendered to her husband. See
4
In-home service providers must “[e]nsure that no in-home services worker is
a member of the immediate family of the client being served by that worker. An
immediate family member is defined as a parent; sibling, child by blood, adopt, or
marriage; spouse; grandparent or grandchild . . . .” Mo. Code Regs. Ann. tit. 19, § 15-
7.021(18)(H). In addition, the Complete Care Code of Ethics provides that employees
are not allowed to provide services to family members. (Trial Tr. vol. III, 32-33.)
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Mo. Code Regs. Ann. tit. 19, § 15-7.021(18)(H). On occasion, Ruth mistakenly used
her married name on time sheets. When this occurred, Silvers would tear up the time
sheet, give Ruth another time sheet, and tell Ruth to use her maiden name. Silvers
also asked Ruth to sign time sheets for clients, other than Silas Buchanan, but Ruth
refused. Silvers told Ruth that she would find someone else to sign the time sheets.
Ruth was present at the Complete Care office in Jacqueline’s home when DHSS
conducted a monitoring visit. The monitors interviewed employees and reviewed
documents, including personnel files. Jacqueline pulled Ruth to the side and told her
to come into a bedroom. There, Jacqueline told Ruth to (1) tell the monitors that her
name was “Ruth White” and (2) use an address other than her own. Hayes was
present at Jacqueline’s house when Jacqueline made these statements to Ruth, and
Hayes was in the room when state monitors interviewed Ruth. Ruth complied with
Jacqueline’s instruction during her interview with the state monitors. Ruth also
testified that she did not receive any training prior to providing services to her
husband and did not receive the training reflected in Exhibit 268B, containing forms
listing Silvers as Ruth’s trainer/supervisor.
Monica testified that she initially worked at VIP. However, she did not
complete an application and was paid in cash so that the various types of public
assistance she received would not be terminated or reduced. Then, as VIP was going
out of business and Monica was going to work at Watkins Loving Care, Silvers told
Monica that she could no longer be paid in cash because, if they kept the practice up,
VIP would be audited. Monica and Lawrence, at Thelma’s suggestion and with
Silvers and Earlean present, agreed that Monica would perform services for clients,
check the boxes of services she performed for clients on time sheets, and then
Lawrence would sign the time sheets. Lawrence picked up the paychecks for the time
sheets he signed (for the work done by Monica) and split the money with Monica.
Under this arrangement, Monica continued working without her public assistance
benefits being reduced or terminated. It is unclear from the record which company
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Monica was working for under this arrangement. She testified that the company she
was working for “changed the name three times.” (Trial Tr. vol. V, 157.) Thus,
viewing the evidence in the light most favorable to the jury’s verdicts, Engler, 521
F.3d at 968, Monica and Lawrence operated under this arrangement at Complete Care
and Watkins Loving Care. After several months, the arrangement fell apart over a
dispute as to the division of paychecks.
Lawrence corroborated Monica’s account of their arrangement. Lawrence also
testified that he did not actually perform any work at VIP, but he signed time sheets
at Earlean’s and Silvers’s request. They discontinued the practice because, according
to Lawrence, Silvers stated that he was getting paid too much money. When Silvers
would not meet his price, Lawrence stopped signing the time sheets. Lawrence
testified that he moved from one company to another and did not always know which
company was operating out of different locations. Although he is listed as providing
services to clients on 45 Complete Care time sheets in Exhibit 263A, 103 Complete
Care time sheets in Exhibit 263B, 8 Complete Care time sheets in Exhibit 263C, and
40 Complete Care time sheets in Exhibit 263D, Lawrence testified that he did not sign
the time sheets or provide services to the clients listed. Lawrence further testified that
he did not sign any of the documents in his Complete Care employment application,
identified as Exhibit 263F.
Earlean testified that she first worked at VIP and then, in August 2001, she
began working at Complete Care. Earlean’s advisors at Complete Care were Hayes
and Jaqueline. Earlean stated that she did not receive any training at Complete Care;
however, Silvers signed a document, dated August 11, 2001, as Earlean’s
trainer/supervisor that stated that Earlean had been provided training using a test
client. Earlean also testified that she did not go through a skills test with a test client
as provided in the “Training Waiver Justification” signed by Silvers as Earlean’s
supervisor.
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Earlean identified Exhibits 261A, 261B, 261C, and 261D as containing time
sheets for three clients for whom she had never provided services and 45 time sheets
(about six months of services) for another client that she had served on only two
occasions. The time sheets were initialed by Hayes as Earlean’s supervisor. Earlean
testified that Hayes had talked to Earlean about signing time sheets. Hayes told
Earlean that she was the only one in the Complete Care office not signing blank time
sheets which were later filled in to reflect services that the signatory had not
performed and that Earlean needed to do so. In compliance with Hayes’s instruction,
Earlean began signing blank time sheets, and someone else completed them. In return,
every pay period Hayes gave Earlean an envelope containing cash that was separate
from her paycheck.
Earlean also testified that her daughter, Lynette, actually performed services for
clients of Complete Care that Complete Care documents attributed to Earlean. This
was done so that the Complete Care records would show Earlean receiving payment
for those services, not Lynette. Earlean testified that this arrangement was a result of
“[s]ome kind of . . . mixup with [Lynette’s] Social Security numbers or something.”
(Trial Tr. vol. III, 58.) Earlean further testified that she knew about the arrangement
between Lawrence and Monica because Earlean was at Thelma’s (Earlean’s sister’s)
house when it was discussed. Earlean stated that Silvers and Hayes discussed how
much Lawrence was to be paid to sign time sheets for Monica.
Lynette testified that she worked at Complete Care. She used a false Social
Security number and listed other false information in her employment application,
including listing her father’s address instead of her own. Lynette stated that she was
married when she began working for Complete Care and that she provided services
to her husband. Lynette testified that Hayes knew that Lynette was married. To
conceal her marriage from DHSS, Lynette used her maiden name instead of her
married name on her Complete Care application. Lynette testified that she knew, at
the time, that Missouri Medicaid would not pay for services that she provided to her
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husband. Lynette testified that she used her maiden name on the 53 time sheets in
Exhibit 262A to conceal that she was providing services to her husband. Although
Lynette’s name appears on time sheets in Exhibit 262D, she testified that she did not
know the client, had never gone to the client’s home, and had not signed the time
sheets. She also stated that she did not receive the required training as reflected in two
pages of her Complete Care employment application; these forms identify Silvers as
the trainer/supervisor. Lynette testified that she also worked for Watkins Loving
Care. Although Lynette did not use a false Social Security number there, she and
Johnson agreed that Lynette would provide services and Johnson would pay Lynette
in cash so that Lynette’s public assistance benefits would not be reduced or
terminated.
Thelma testified that, after she closed VIP, she began working at Complete Care
in 2001. She stated that Silvers served as her supervisor. Thelma identified several
time sheets in Exhibit 272B, indicating that she had provided services for a certain
client on multiple dates when, in fact, she had only provided services to that client on
one occasion. She further testified that she provided services to the client identified
in Exhibit 272C but did not do so for all of the dates listed on the time sheets.
Young testified that she began working for Complete Care in May 1999.
Young stated that she did not provide the services reflected in the time sheets in
Exhibit 283A. She also testified that she had not, in fact, signed some of the time
sheets in Exhibits 283B and 283D that purported to contain her signature.
Theresa testified that she was employed at VIP from 1998 to 2001 as a certified
nurse assistant (CNA). She stated that she transferred her clients to Complete Care
when VIP closed. She also testified that she worked briefly at Watkins Loving Care.
Theresa testified that she only signed 4 of the 46 time sheets in Exhibit 267C and that
her signature is forged on the other 42 time sheets. Theresa stated that she did not
know who had signed the sheets. Theresa testified that she turned time sheets into
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Hayes. Theresa also stated that she never provided services to client Peaches
Anderson although Theresa is listed as an aide on many time sheets with respect to
Anderson.
Sabrina testified that she worked at VIP, Complete Care, and Watkins Loving
Care. Sabrina stated that she had clients sign time sheets on a weekly basis and that
the time sheets did not always reflect the time that she actually spent with the clients.
Sabrina turned in her time sheets to Silvers. Sabrina also admitted that she never
provided services to four of the clients identified in the time sheets in Exhibits 266B-
266F. In addition, Sabrina stated that, while she worked at Complete Care, Jacqueline
asked Sabrina to sign time sheets concerning services that she had not actually
provided to the clients.
Norman testified that, although her name appears on numerous time sheets for
Complete Care and Watkins Loving Care, she only worked one day in May 1999. She
stated that she did not provide services to the clients identified on the 111 time sheets
in Exhibit 276A, the 30 time sheets in Exhibit 276B, and the 45 time sheets in Exhibit
276C. Norman further testified that Jacqueline admitted to Norman that Jacqueline,
herself, signed Norman’s name on many time sheets.
Anthony testified that he worked for Complete Care and Watkins Loving Care.
Anthony stated that he went to the home of a severely physically and mentally
disabled child for a couple of hours but submitted a time sheet reflecting that he had
been there for four hours. He received no training prior to providing services to this
child. Anthony also signed time sheets for a second client to whom he had not
provided all the hours of services reflected therein; these time sheets were already
filled out, and he signed them. Anthony also signed time sheets for a third client,
whom he had never met and for whom he provided no services. Earlean asked him
to sign these time sheets, and he turned them in to her. Anthony testified that he knew
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that a state agency was going to make payments based on what was reported on the
time sheets.
Johnson testified that she and Jacqueline opened Watkins Loving Care in 2002.
Johnson testified that she prepared the Watkins Loving Care proposal and submitted
it. Watkins Loving Care and the Missouri Division of Medical Services executed a
Title XIX participation agreement on April 19, 2002. Although Johnson testified that
Jacqueline actually owned Watkins Loving Care, Jacqueline asked Johnson if
Jacqueline could use a tax identification number that Johnson had obtained to open
a day care center. Jacqueline agreed to pay Johnson $5,000 a month in exchange for
the use of the number and Johnson signing documents related to Watkins Loving Care
that called for the signature of the owner. Johnson’s only function in relation to
Watkins Loving Care between March and July 2002 was signing documents.
Johnson also testified that Earlean ran the Watkins Loving Care office. She
stated that Watkins Loving Care had an account at First Community Credit Union in
which Missouri Medicaid funds were deposited. Hayes, Earlean, and Silvers were the
signatories on the account. Every payday, Johnson would ensure that there was
sufficient money to make payroll, withdraw and retain $1,000, and give the remainder
to Jacqueline. Jacqueline usually received $2,500 to $3,000 from Watkins Loving
Care twice a month. Johnson stated that Silvers worked at Watkins Loving Care prior
to July 2002 but left and returned to Complete Care when Johnson began working
there in July 2002. Johnson did all of the billing for Watkins Loving Care after July
2002.
Johnson testified that Jacqueline asked Johnson to sign time sheets for services
purportedly provided to Toni Phillips, a friend of Jacqueline’s. Johnson stated that
she went to Phillips’s home for about an hour one time per week, but Johnson would
complete time sheets and bill for four hours a day, five days a week. Watkins Loving
Care received payments for these nonrendered services, and Phillips received a
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portion of the Medicaid payment. Johnson stated that sometimes she would give the
cash payments directly to Phillips and other times Johnson would give the cash to
Jacqueline to give to Phillips. Johnson also testified that she did not provide the
services to the clients identified in the eight time sheets in Exhibit 275A and the seven
time sheets in Exhibit 275B.
Joan Robinson, a licensed registered nurse (“RN”), testified that she worked at
VIP, Complete Care, and Watkins Loving Care.5 She stated that, regardless of what
company she was working for, her duties remained the same and she saw the same
patients. Robinson visited clients’ homes to assess and evaluate them. Robinson
completed the required forms to reflect her visits and assessments. Robinson stated
that, during the spring of 2002, Jacqueline called Robinson and told her that
Jacqueline needed several nurse-visit reports that Robinson had not submitted.
Jacqueline told Robinson that the state inspectors were at Jacqueline’s home and
suggested that Robinson bring the reports to a parking lot near Jacqueline’s home.
Robinson went to the parking lot and gave the nursing reports to Silvers. Silvers
asked Robinson if she would sign some additional nurse visit reports that Silvers had
with her. Robinson told Silvers that Robinson had not visited the clients. Silvers told
Robinson that Robinson could copy the reports in her own handwriting and sign the
reports. Robinson refused. Robinson also testified that, with regard to the nursing
reports in Exhibits 282D, 282E, 282F, and 282J which were submitted to DHSS, she
had not visited the clients or performed the assessments reflected therein and that the
reports contained her forged signature.
Yvette Phillips, Silvers’s sister, testified that she never worked for Complete
Care and had not lived in the St. Louis area since about 1993. She testified, however,
5
Per the Complete Care proposal and as required by Missouri administrative
regulations, see Mo. Code Regs. Ann. tit. 19, § 15-7.021(12), Complete Care was
required to employ a RN to supervise the RN visit program and to give on-the-job
training to aides.
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that she was listed as an aide on numerous Complete Care time sheets in Exhibits
270A-270E. She also stated that a Complete Care employment application in her
name, Exhibit 270F, contained false information with respect to her residence and
experience.
On February 5, 2008, the jury returned its verdict. The jury convicted Hayes on
counts one and twelve and found her not guilty on the remaining eleven counts. The
jury convicted Silvers on all counts. On May 28, 2008, the district court sentenced
Hayes to 51 months of imprisonment to be followed by 37 months supervised release.
The district court also ordered Hayes to pay $545,713 in restitution. On May 29,
2008, the district court sentenced Silvers to 51 months imprisonment on counts 1-13,
to be served concurrently, and three years supervised release. Silvers was also ordered
to pay $545,713 in restitution. Appellants bring this appeal.
II.
We first address Hayes’s arguments on appeal, that the district court erred by
denying the: (1) motion to dismiss the superceding indictment, (2) Batson challenge,
(3) objection to the deliberate ignorance jury instruction, (4) motion for judgment of
acquittal, and (5) challenges to sentencing enhancements for her role in the offense
and abuse of trust.
A.
We review the district court’s denial of Hayes’s motion to dismiss the
superceding indictment de novo. See United States v. Cvijanovich, 556 F.3d 857, 862
(8th Cir. 2009). Hayes asserts that in order for the superceding indictment to invoke
the district court’s jurisdiction and to state the offense of health care fraud conspiracy
it must sufficiently allege the existence of provider agreements between Missouri
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Medicaid and Complete Care because all allegations against her stem from her
employment at Complete Care.6
We first consider the district court’s jurisdiction. Under 18 U.S.C. § 3231,
“[t]he district courts of the United States . . . have original jurisdiction, exclusive of
the courts of the States, of all offenses against the laws of the United States.” See also
United States v. Cotton, 535 U.S. 625, 630-81 (2002) (“[A] district court ‘has
jurisdiction of all crimes cognizable under the authority of the United States’ . . . .”
(quoting Lamar v. United States, 240 U.S. 60, 65 (1916)). Pursuant to section 3231,
federal district courts possess original jurisdiction over all violations of federal law.
United States v. Watson, 1 F.3d 733, 734 (8th Cir. 1993) (per curiam). The
superceding indictment charges Hayes with violating 18 U.S.C. §§ 371, 1035, 1347
and 2. Because the indictment sufficiently alleges violations of “laws of the United
States,” 18 U.S.C. § 3231, the district court had jurisdiction and correctly denied the
motion to dismiss the superceding indictment on the ground that jurisdiction was
lacking. See United States v. Trotter, 478 F.3d 918, 920 n.2 (8th Cir. 2007) (per
curiam) (rejecting defendant’s argument that the district court erred in failing to
dismiss his indictment for lack of jurisdiction “[b]ecause [the defendant] was charged
with an offense against the laws of the United States” such that “the court clearly had
jurisdiction”).
We next address whether the superceding indictment fails to state the offense
of health care fraud conspiracy.
6
Counts 2-13 of the indictment allege that Hayes made false statements to a
health care benefit plan in violation of 18 U.S.C. §§ 1035 and 2. Although Hayes also
asserts that counts 2-13 fail to state an offense, we do not address this contention as
Hayes was acquitted on counts 2-11 and 13, and we vacate Hayes’s conviction on
count 12 on another ground. See infra Part II.D.
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An indictment adequately states an offense if: it contains all of the
essential elements of the offense charged, fairly informs the defendant
of the charges against which he must defend, and alleges sufficient
information to allow a defendant to plead a conviction or acquittal as a
bar to a subsequent prosecution. An indictment will ordinarily be held
sufficient unless it is so defective that it cannot be said, by any
reasonable construction, to charge the offense for which the defendant
was convicted.
United States v. Sewell, 513 F.3d 820, 821 (8th Cir.) (quotation omitted), cert. denied,
128 S. Ct. 2517 (2008). Furthermore, “[a]n indictment is normally sufficient if its
language tracks the statutory language.” Id. (citing Hamling v. United States, 418
U.S. 87, 117 (1974)).
Count one charges that Hayes, along with Complete Care, Watkins Loving
Care, Jacqueline, Johnson, Silvers, and Earlean, violated 18 U.S.C. § 371 by
participating in a conspiracy to commit a crime against the United States by (1)
defrauding a health care benefit program, see 18 U.S.C. § 1347, and (2) making false
claims for health care benefit, see 18 U.S.C. § 1035. Section 371 provides, in
pertinent part:
If two or more persons conspire either to commit any offense against the
United States, or to defraud the United States, or any agency thereof in
any manner or for any purpose, and one or more of such persons do any
act to effect the object of the conspiracy, each shall be fined under this
title or imprisoned not more than five years, or both.
18 U.S.C. § 371. The essential elements of a section 371 conspiracy crime are that:
(1) the defendants agreed with another, (2) to commit crimes against the United States
or violate the laws of the United States, and (3) at least one overt act was committed
in furtherance of the agreement. See id.-16-
The superceding indictment specifies that the conspiracy took place in or about
1999 to 2005 in the Eastern District of Missouri and elsewhere (Indictment 7) and
provides that “[t]he purpose of the conspiracy was to obtain Medicaid reimbursement
for in-home services that were not provided or were provided by unauthorized or
unqualified persons” (id. at 8). The superceding indictment also lists several overt
acts in furtherance of the conspiracy: that Jacqueline and Complete Care submitted
an application to become a Medicare provider, numerous examples of time sheets
submitted by Complete Care that falsely reflected dates and times of service to clients
and falsely identified persons purportedly providing the services, and receipt of
Medicaid funds for the false claims. (Id. at 9-11.) Because the superceding
indictment tracks the language of the conspiracy statute, identifies the federal criminal
laws that are the subjects of the conspiracy, alleges each of the essential elements of
the crime of conspiracy, states the nature of the fraudulent scheme that was the subject
of the conspiracy, specifies the approximate time period during which the conspiracy
took place, states the place from which the scheme was allegedly operated, and
specifies overt acts that furthered the conspiracy, the superceding indictment is
sufficient as it pertains to the conspiracy charge. See Sewell, 513 F.3d at 821.
Hayes asserts, without authority, that the superceding indictment fails to invoke
the district court’s jurisdiction and to state the offense of health care fraud conspiracy
because it does not contain sufficient allegations that a provider agreement existed
between DHSS and Complete Care. None of the statutes that Hayes is charged with
violating in the conspiracy count state that the existence of a provider agreement is a
prerequisite for conviction or even mention a provider agreement. See 18 U.S.C. §§
371, 1035, 1347. Thus, the statutes provide no support for Hayes’s assertion that such
an allegation is required in the superceding indictment in order to sufficiently invoke
the district court’s jurisdiction or state a health care fraud conspiracy offense in
violation of the statutes listed in count one.
-17-
The Missouri Code of State Regulations requires that an in-home service
provider have both a written provider agreement with Missouri Medicaid and that
such an agreement is a prerequisite to obtaining reimbursement from Missouri
Medicaid. (Indictment 6.) However, it is undisputed that, regardless of what Missouri
regulations ordinarily require, Complete Care participated in the Missouri Medicaid
program, sought reimbursement for in-home services purportedly provided to disabled
and elderly residents, and Complete Care was reimbursed by Missouri Medicaid. This
occurred whether or not Complete Care had a provider agreement with Missouri
Medicaid. We reject Hayes’s argument that, absent the existence of a provider
agreement between Complete Care and DHSS, she was, essentially, free to make false
statements to DHSS, receive an unlimited amount of money, and be immune from
prosecution. Therefore, the lack of an allegation that a provider agreement existed
between Complete Care and Missouri Medicaid at the time of Hayes’s offenses does
not render the superceding indictment insufficient in terms of jurisdiction or with
respect to the stating of the offense of health care fraud conspiracy. Accordingly, the
district court did not err in denying Hayes’s motion to dismiss the superceding
indictment.
B.
Hayes next contends that the district court erred in denying her Batson
challenge to the government’s peremptory strike of venire person 22, an
African-American female, because the government’s explanation for striking her was
not supported by the record. We review the district court’s Batson ruling for clear
error, keeping in mind that the ultimate burden of persuasion regarding racial
motivation rests with, and never shifts from, the party opposing the strike. United
States v. Bolden, 545 F.3d 609, 614 (8th Cir. 2008).
Courts evaluate Batson challenges under a three-step test. First, the
defendant must make a prima facie case that the prosecution’s strike was
-18-
motivated by race; second, the prosecution must offer a race-neutral
reason for the strike; and third, taking into account all the evidence, the
trial court must find whether or not the prosecutor was motivated by
purposeful discrimination.
Kahle v. Leonard, 563 F.3d 736, 739 (8th Cir. 2009) (quotation omitted).
Here, Hayes raised a Batson challenge when the government struck venire
person 22. The district court determined that Hayes had made a prima facie showing
of a race-based strike. The court then shifted the burden to the government to provide
a race-neutral reason for the strike. The government offered several reasons for
striking venire person 22, one of which was that venire person 22 was the only panel
member that responded to the question about whether they would insist on hearing
from everyone involved in the case and indicated that she would prefer to do so before
making a decision in the case.7 The government explained that her response “tends
to show that she would expect a high volume of proof, a high number of witnesses and
comprehensive assessment by all witnesses which is, of course, not the government’s
burden . . . .” (Trial Tr. vol. I, 189-90.) Defense counsel responded, and, taking into
account all of the evidence, the district court denied the Batson challenge.
Hayes asserts that the district court clearly erred because the government’s
proffered race-neutral reason was not supported by the record. However, the voire
dire transcript provides that venire person 22 expressed concern about whether
everyone with information concerning the case would testify.8 Therefore, we
7
We do not address the government’s additional reasons.
8
The transcript provides the following exchange between the prosecutor and
venire person 22:
Q. Well, if a case involves a number of people and you hear from some people but
other people, for whatever reason, don’t testify in the trial, is anybody going to
be troubled by that just in and of itself, that I haven’t heard from absolutely
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conclude that the district court did not clearly err in denying Hayes’s Batson
challenge.
C.
Hayes also asserts that the district court abused its discretion in submitting a
deliberate ignorance instruction9 to the jury because the government only presented
everybody so I won’t be able to render a verdict?
A. I would be troubled but I was just, you know, you can’t really decide if you
don’t have the evidence, but that’s just [a] comment.
Q. What was your comment?
A. No. I was just saying that if–it makes it credible for whoever[’s] side it is to get
a chance to do everybody because you don’t know, you know, who’s more
important, who knows what more and I think it’s better to do everything.
(Trial Tr. vol. I, 74-75.)
9
The district court’s deliberate ignorance instruction was as follows:
Now members of the jury, you may find that defendant, Gwendolyn
Silvers or Chante Hayes, acted knowingly. If you find beyond a
reasonable doubt that the defendant, Gwendolyn Silvers or Chante
Hayes, was aware of a high probability that statements submitted by
them to Missouri Medicaid were false and that she submitted deliberately
or, rather, that she deliberately avoided learning the truth. Now the
element of knowledge may be inferred if a defendant, Gwendolyn Silvers
or Chante Hayes, deliberately closed her eyes to what would otherwise
have been obvious to her. You may not find that a defendant,
Gwendolyn Silvers or Chante Hayes, acted knowingly. However, if you
find that a defendant actually believed that the statements submitted by
them to Missouri Medicaid were true, if you find that either Gwendolyn
Silvers or Chante Hayes was simply careless, a showing of negligence
-20-
direct evidence that she had actual knowledge of the scheme and no evidence that she
was deliberately ignorant of the scheme.10 “We review the District Court’s decision
to give a jury instruction under the abuse-of-discretion standard. Our review of the
District Court’s decision to give [a deliberate ignorance] instruction must be done by
viewing the evidence and any reasonable inference from that evidence in the light
most favorable to the government.” United States v. Woodward, 315 F.3d 1000,
1003-04 (8th Cir. 2003) (citation omitted). “While a district court should not give the
deliberate-ignorance instruction when the evidence points solely to the defendant’s
actual knowledge of the facts in question, the instruction is particularly appropriate
when the defendant denies any knowledge of a criminal scheme despite strong
evidence to the contrary.” Id. at 1004 (quotation omitted); see also United States v.
Whitehill, 532 F.3d 746, 751 (8th Cir.) (“A willful blindness instruction is not
appropriate if the evidence implies [the defendant] could only have had either actual
knowledge or no knowledge of the facts in question.” (quotation omitted)), cert.
denied, 129 S. Ct. 610 (2008).
or mistake or carelessness is not sufficient to support a finding of
knowledge.
(Trial Tr. vol. VII, 97.)
10
In denying Hayes’s objection to the willful ignorance instruction, the district
court stated,
I think there is substantial evidence that shows that Miss Silvers and
Chante Hayes were in and out of various locations where allegedly
fraudulent acts were ongoing. Whether or not they may have perpetrated
the fraud individually I think is a question for the jury but I believe the
fact that they were in and out while things were happening that were
unlawful and fraudulent and ignored them could give rise to a jury to
understand the purpose of this instruction, so I am going to overrule the
objection . . . .
(Trial Tr. vol. VII, 10-11.)
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At trial, Hayes denied any involvement with or knowledge of the health care
fraud conspiracy of which she was charged. However, the government presented
evidence to the contrary. For example, Earlean testified that, at one point, she had an
exchange in the Complete Care office in which Hayes told Earlean that she was the
only one in the office not signing time sheets, that they needed her to sign some time
sheets for services that she had not provided, and that she did so. (Trial Tr. vol. 3, 53-
54.) Earlean stated that often she simply signed blank time sheets that were completed
by those at the Complete Care office. (Id. at 54.) Earlean testified that every pay
period, in addition to her paycheck, Hayes paid Earlean cash for the time sheets that
Earlean signed for services she had not performed. (Id. at 55-56.) As another
example, Ruth testified that she completed her application for employment at
Complete Care using her maiden name because Hayes, who gave Ruth the application
at Ruth’s home, instructed Ruth to complete the application exactly as she had at VIP.
(Trial Tr. vol. V, 91-94.) In addition to the evidence of Hayes’s direct knowledge of
the health care fraud conspiracy, the evidence showed that she was a supervisor and
office manager at Complete Care, she was responsible for billing and time sheets, and
she initialed, as supervisor, hundreds of time sheets that reflected services that had not
actually been performed. (Trial Tr. vol. III, 35-36, 39-40, 41-44, 47, 51-52.)
In sum, Hayes denied any involvement in or knowledge of the fraudulent
scheme or the filing of false Medicaid claims in the face of strong evidence to the
contrary. In addition to the evidence of her actual knowledge of the scheme, Hayes
managed the Complete Care office and was responsible for submitting hundreds of
fraudulent claims. Therefore, the evidence justified a deliberate indifference
instruction, see Whitehill, 532 F.3d at 751; Woodward, 315 F.3d at 1003-04, and the
district court did not abuse its discretion in so instructing the jury.
-22-
D.
Hayes next asserts that the district court erred in denying her motion for
judgment of acquittal. Hayes raises the same arguments that we have already rejected
in Section II. A. of this opinion, except that here she challenges her convictions based
on the government’s failure to prove the existence of a provider agreement between
Complete Care and Missouri Medicaid at trial rather than the sufficiency of the
superceding indictment. As we have already determined that the government’s failure
to allege the existence of such an agreement did not mar the superceding indictment,
the same reasoning necessitates that we reject Hayes’s contention. Thus, we conclude
that the district court did not err in failing to grant Hayes’s motion for judgment of
acquittal on this basis. Furthermore, we note that Barbara Reuter, of DHSS, testified
that two written provider agreements between DHSS and Complete Care were in
effect from 1998 to June 30, 1999, and from July 1999 to June 30, 2000, and that
DHSS continued to deal with Complete Care as a provider of in-home health services
until July 2005. (Trial Tr. vol. II, 94.)
Hayes also argues that the government presented insufficient evidence for count
12 to go to the jury.
We review de novo a district court’s denial of a motion for judgment of
acquittal. We view the evidence in the light most favorable to the
Government and determine whether the evidence is sufficient to permit
a reasonable jury to conclude that the defendant is guilty beyond a
reasonable doubt.
United States v. Clarke, 564 F.3d 949, 954 (8th Cir. 2009) (quotation omitted).
Count 12 alleges that, in violation of 18 U.S.C. § 1035, Hayes and the other
defendants, knowingly submitted a false statement in a matter involving a health care
benefit program on or about August 11, 2001,
-23-
in that Defendant Gwen Silvers completed and signed a “Training
Waiver Justification” form . . . that falsely and fraudulently stated and
represented that Ruth Buchanan had completed 12 hours of training and
had successfully completed a skills test on August 11, 2001 and have
four hours of on the job training on August 21, 2001.
(Indictment 14-15.) Hayes does not dispute that the training waiver justification form
is a false statement. Rather, Hayes contends that “[t]here was no evidence . . . that
[she] was involved in or had any knowledge of this false statement with respect to the
training waiver justification form.” (Hayes’s Br. 35.) In addition to section 1035, the
crime was also charged under an aiding and abetting theory, see 18 U.S.C. § 2, and the
district court submitted an aiding and abetting instruction to the jury, without
objection from Hayes. Hayes could be convicted under an aiding-and-abetting theory
if the government proved that she knew Silvers was falsifying the training waiver
justification form and committed an affirmative act to further Silvers’s offense. See
18 U.S.C. § 2(a); see also United States v. Mitchell, 388 F.3d 1139, 1143-44 (8th Cir.
2004) (“There are three essential elements of aiding and abetting: (1) the defendant
associated herself with the unlawful venture; (2) the defendant participated in it as
something she wished to bring about; and (3) the defendant sought by her actions to
make it succeed.”).
The specific false representation alleged in count 12, the training waiver
justification form, is contained in Exhibit 268B, the Complete Care employee file for
Ruth. Hayes and Silvers both signed off on forms included in Ruth’s file. The only
evidence as to the training waiver justification form, itself, was Ruth’s testimony
during the government’s direct examination.
Q. I asked you earlier about some training and you indicated that you didn’t
receive any training.
A. Yes.
-24-
Q. Did you ever get tested on your ability to perform certain services?
A. No.
Q. Would you look at page 12, please. At the top of that page does it say “training
waiver justification”?
A. Yes.
Q. And are you listed as the employee?
A. Yes.
Q. Will you come down to the section that says “12 hours additional,” referring to
the training.
A. Okay.
Q. You see the name of the Kenneth Hayes?
A. Yes.
Q. And it says “skills test.” Did you ever have a skill test with Kenneth Hayes as
the client?
A. No.
Q. Did you ever receive on-the-job training where someone observed your
working with your husband, Silas Buchanan?
A. No.
Q. Whose name appears on the line that says “supervisor’s signature”?
A. Gwendolyn Silvers.
-25-
Q. And if you go to the next page, [which] refers to the same date, August 11 of
2001. Do you see that?
A. Yes.
Q. The very top of that page.
A. Yes.
Q. And who is trainer/supervisor that’s listed?
A. Gwendolyn Silvers.
(Trial Tr. vol. V, 95-97.)
The government argues that the evidence was sufficient to permit a reasonable
jury to conclude that Hayes was guilty of aiding and abetting Silvers’s falsification of
the training waiver justification form because the evidence demonstrated that Hayes,
as supervisor and office manager, worked closely with all of the paperwork associated
with Complete Care. The government also points to the fact that Silvers signed off
on the Ruth’s training justification form, dated August 11, 2001, the same day Hayes
traveled to Ruth’s home to (1) have Ruth fill out the Complete Care employment
application portion of the file and (2) instruct Ruth to complete the application as she
had at VIP, i.e. to use her maiden name in order to hide that she was caring for her
husband in violation of Medicaid regulations.
Despite the evidence of Hayes’s involvement with the health care conspiracy
at Complete Care and the fact that we must view the evidence in the light most
favorable to the government, there was no evidence that Hayes knew Silvers was
falsifying the training waiver justification form or that Hayes committed an
affirmative act to further Silvers’s offense. Given the utter lack of evidence on either
point, no rational juror could have found beyond a reasonable doubt that Hayes aided
-26-
and abetted the false statement. We therefore hold, as we must, that the district court
erred in denying Hayes’s motion for acquittal on the false statement charge.
E.
Hayes’s final contention is that the district court committed procedural error by
incorrectly calculating her advisory Guidelines range. See Gall v. United States, 552
U.S. 38, 128 S. Ct. 586, 597 (2007) (providing that we must ensure that the district
court did not commit a significant procedural error, including improperly calculating
the Guidelines range). She argues that the court clearly erred by increasing her
offense level: (1) by two levels, pursuant to United States Sentencing Commission,
Guidelines Manual, §3B1.1(c) (Nov. 2008), on the ground that she was a supervisor
of criminal activity and (2) by two levels, pursuant to USSG §3B1.3, on the basis that
she abused a position of trust in a manner that contributed to her offenses.
First, Hayes asserts that the district court clearly erred in applying the
supervisor enhancement. “We review the district court’s decision to assess a
sentencing enhancement based upon a defendant’s role in the offense for clear error
. . . .” United States v. Guzman-Tlaseca, 546 F.3d 571, 579-80 (8th Cir. 2008)
(quotation omitted), cert. denied, 129 S. Ct. 2025 (2009). USSG §3B1.1(c) provides
that the sentencing court should increase the defendant’s offense level by two levels
“[i]f the defendant was an organizer, leader, manager, or supervisor in any criminal
activity” involving less than five participants. Hayes contends that there was
insufficient evidence to support the enhancement because the record did not indicate
that she had any decisionmaking authority at Complete Care. However, Earlean
testified that Hayes was one of her supervisors at Complete Care and told her what to
do and that Hayes was also responsible for billing. (Trial Tr. vol. III, 35.) Earlean
also identified numerous time sheets with Hayes’s initials as supervisor. (Id. at 39-40,
41-44, 47, 51-52.) In addition, Ruth identified a Complete Care document in which
Hayes is titled “office manager.” (Id. at 97.) Also, Hayes admits that she “did the
-27-
billing, worked with time sheets and made certain decisions about the business.”
(Hayes’s Br. 43.) Finally, Complete Care’s proposal to Missouri Medicaid identified
Hayes as Complete Care’s vice-president. (Trial Tr. vol. II, 50.) Thus, the district
court did not clearly err in applying the enhancement.
Second, Hayes contends that the district court erred in applying the abuse-of-
trust enhancement. Whether the defendant may occupy a position of trust is a question
of law; if so, whether she did is a question of fact. United States v. Baker, 200 F.3d
558, 563-64 (8th Cir. 2000). “We review the legal component of the abuse of trust
determination de novo and the district court’s factual findings for clear error.” United
States v. Anderson, 349 F.3d 568, 573 (8th Cir. 2003).11 USSG §3B1.3 provides that
the sentencing court should increase the defendant’s offense level by two levels “[i]f
the defendant abused a position of public or private trust, or used a special skill, in a
manner that significantly facilitated the commission or concealment of the offense .
. . .”
“Determining what constitutes a position of trust for the purposes of §3B1.3 is
not a simple task.” United States v. Morris, 286 F.3d 1291, 1296 (11th Cir. 2002)
(quoting United States v. Iannone, 184 F.3d 214, 222 (3d Cir. 1999)).
11
The government contends that we should review the district court’s
application of the abuse of trust enhancement for plain error because Hayes’s
objection to the enhancement at sentencing was premised on the proper standard of
proof. See United States v. Phelps, 536 F.3d 862, 865 (8th Cir. 2008), cert. denied,
129 S. Ct. 1390 (2009) (“If a defendant fails to timely object to a procedural
sentencing error, the error is forfeited and may only be reviewed for plain error.”).
However, while Hayes characterized her standard of proof argument as her “main
objection,” she also raised a sufficiency of the evidence objection. (Sentencing Tr.
14, 71.) The government responded to an evidentiary objection, and the district
court’s explanation for imposing the objection demonstrates that Hayes sufficiently
raised the issue to avoid plain error review here. (Id. at 70, 72-73, 74-76.)
-28-
[T]he notion of “trust” embodied in the guideline is not the one
contemplated by the ordinary dictionary concept of reliance or
confidence for, in that sense, a bank trusts its tellers not to steal from the
till. Rather, as used in the guideline, “position of public or private trust”
is a term of art, appropriating some of the aspects of the legal concept of
a trustee or fiduciary. The lesser degree of direct supervision exercised
over fiduciaries or senior employees as opposed to cashiers, and hence
the greater difficulty in detecting their transgressions, may explain part,
but not all, of the distinction. . . . . Where an individual makes himself
particularly vulnerable by entrusting another with substantial authority
and discretion to act on his behalf and then relies upon and defers to that
person, a decision to take advantage of that trust and vulnerability is
particularly abhorrent, as it undermines faith in one’s fellow man in a
way that the ordinary pickpocket simply cannot.
United States v. Garrison, 133 F.3d 831, 839 n.18 (11th Cir. 1998) (quoting United
States v. Ragland, 72 F.3d 500, 502-03 (6th Cir. 1996)).
Furthermore, “[b]ecause ‘there is a component of misplaced trust inherent in the
concept of fraud,’ a sentencing court must be careful not to be ‘overly broad’ in
imposing the enhancement for abuse of a position of trust . . . .” Id. at 838 (quoting
United States v. Mullens, 65 F.3d 1560, 1567 (11th Cir. 1995); see also United States
v. Koehn, 74 F.3d 199, 201 (10th Cir. 1996) (“In every successful fraud the defendant
will have created confidence and trust in the victim, but the sentencing enhancement
is not intended to apply in every case of fraud.”). Therefore, “for the abuse-of-trust
adjustment to apply in the fraud context, there must be a showing that the victim
placed a special trust in the defendant beyond ordinary reliance on the defendant’s
integrity and honesty that underlies every fraud scenario[.]” United States v. Williams,
527 F.3d 1235, 1250-51 (11th Cir. 2008).
Here, the primary victim of Hayes’s fraudulent behavior is Medicaid, a
governmental program. In United States v. Trice, 245 F.3d 1041 (8th Cir. 2001) (per
curiam), this court determined that the district court erred in applying the abuse-of-
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trust enhancement because “the victim of [the defendant’s] offense, making a
fraudulent statement, was the United States,” and the defendant “was not in a position
of trust vis-à-vis the United States . . . .” Id. at 1042. In Trice, the defendant, the
president of a non-profit corporation formed to build a housing complex for
handicapped individuals, pled guilty to making a fraudulent statement in violation of
18 U.S.C. § 1001, after falsely stating on a United States Department of Housing and
Urban Development (“HUD”) form that he had never been convicted of a felony. Id.The Trice Court explained that the abuse-of-trust enhancement did not apply because
“the relationship between Trice and the United States was nothing more than an
‘arm’s-length business relationship.’” Id.; see United States v. Septon, 557 F.3d 934,
937 (8th Cir. 2009) (“[A]n arms-length commercial relationship will ordinarily not
suffice for the [abuse-of-trust] enhancement to apply . . . .”); Baker, 200 F.3d at 563-
64 (“[W]e agree with the Fourth Circuit that, as a matter of law, ‘ordinary commercial
relationships do not constitute a trust relationship sufficient to invoke the [abuse-of-
trust] enhancement.’” (quoting United States v. Moore, 29 F.3d 175, 180 (4th Cir.
1994)).
Within the health care fraud context, the majority of our sister circuits that have
addressed the question have held that health care providers who defraud Medicaid or
Medicare may be subject to the abuse-of-trust enhancement. See United States v.
Bolden, 325 F.3d 471, 478, 504-05 (4th Cir. 2003) (affirming the application of the
abuse-of-trust enhancement because the defendant, the director of a nursing facility,
occupied a position of trust with respect to Medicaid because “she possessed
substantial discretionary authority[,] Medicaid entrusted [her] with thousands of
dollars in prospective payments to [the nursing facility][] that were to be used for the
benefit of its Medicaid beneficiaries[,] [a]nd her abuse of that authority contributed
significantly to the commission and concealment of the fraud scheme”); United States
v. Hoogenboom, 209 F.3d 665, 671 (7th Cir. 2000) (affirming the application of the
abuse-of-trust enhancement to psychologist who falsely billed Medicare because
“[m]edical service providers occupy positions of trust with respect to private or public
-30-
insurers (such as Medicare) within the meaning of guideline §3B1.3”); United States
v. Gieger, 190 F.3d 661, 663, 665 (5th Cir. 1999) (affirming the application of the
abuse-of-trust enhancement to owners of an ambulance transportation service provider
convicted for conspiracy to submit false claims to Medicare because “the defendants
carried out their fraud by abusing a . . . position of trust”); United States v. Wright,
160 F.3d 905, 910-11 (2d Cir. 1998) (affirming the application of the abuse-of-trust
enhancement where the defendants had embezzled funds from a Medicaid-funded
residence facility because public funds were entrusted to the facility for the benefit of
its patients, and the defendants, through their positions at the facility, had embezzled
the funds “without fear of timely detection by . . . the government, who entrusted them
with the funds . . . for the well-being of the intended beneficiaries”).
However, the Eleventh Circuit has determined that, as a matter of law, a
Medicaid-funded health care provider does not occupy a position of trust vis-à-vis
Medicaid. See United States v. Mills, 138 F.3d 928, 930, 941 (11th Cir.), modified
on reh’g on other grounds, 152 F.3d 1324 (11th Cir. 1998) (concluding that the
defendants, officers and majority shareholders of a Medicare services provider, were
entitled to resentencing without the abuse-of-trust enhancement because a Medicare-
funded care provider does not occupy a position of trust vis-à-vis Medicare); Garrison,
133 F.3d at 841-43 (remanding for resentencing, without abuse-of-trust enhancement,
in part, because the defendant, the owner and chief executive officer of a home health
care provider, “did not hold a direct or fiduciary-type position of public trust relative
to the Medicare program, the victim” as “statutory reporting requirements do not
create a position of trust relative to a victim of the crime”).
In denying Hayes’s objection to the abuse-of-trust enhancement, the district
court stated:
[T]he documents are replete with evidence that [Hayes] signed off on a
great many of the documents involved that were submitted to Medicaid.
-31-
Medicaid relied on those documents. Hayes set herself out as one who
was in a position to execute those documents by signing off on them
either with her initials or by her signature and as a result of that and the
other parts of the overall scheme in this matter, the jury found that this
defendant was guilty of Count 1 of the indictment, the conspiracy to
defraud Medicaid. . . . I think it is appropriate in this matter to add . . .
the two levels under Section 3B1.3.
(Sentencing Tr. 74-76.) As to the legal component of the abuse-of-trust enhancement,
we do not adopt the Eleventh Circuit’s position. Rather, Hayes, as an employee of a
Medicaid-funded home health care provider, may occupy a position of trust. See
Baker, 200 F.3d at 564. Therefore, we must determine whether, “[a]s a matter of fact,
the district court’s finding that [Hayes] occupied a position of . . . trust in this case was
. . . clearly erroneous.” See id.The government argues that facts support the district court’s application of the
abuse of trust enhancement because: (1) Hayes “was the person who turned false bills
into government reimbursements,” and (2) “the criminal scheme was allowed to
continue and grow through the work of Defendant who ultimately chose to submit
bills she knew to be false.” (Gov’t Br. 47.) However, the abuse of trust enhancement
is not “so far reaching that it might cause virtually anyone who is commanded by
statute to make an accurate report to the government to be subject to a Section 3B1.3
enhancement. All taxpayers who file false tax returns, for example, might be
included.” United States v. Broderson, 67 F.3d 452, 455 (2d Cir. 1995). Here, the
district court’s superficial reasoning does not demonstrate that Hayes and Medicaid’s
relationship was such that it went beyond the ordinary commercial relationship which
is insufficient to invoke the abuse-of-trust enhancement. See Septon, 557 F.3d at 937;
Trice, 245 F.3d at 1042; Baker, 200 F.3d at 564. Therefore, the district court clearly
erred in applying the abuse-of-trust enhancement.
-32-
III.
We now address Silvers’s arguments on appeal. She asserts that the district
court erred in: (1) denying her motion for judgment of acquittal, (2) in its response to
a question from the jury, and (3) determining the total amount of loss attributable to
her.
A.
Silvers first argues that the district court erred in denying her motion for
judgment of acquittal because the government failed to produce sufficient evidence
to establish that she worked for any health care provider when her employer had a
provider agreement with Missouri Medicaid. Silvers does not otherwise challenge the
sufficiency of the evidence to sustain her convictions. Because Silvers’s argument is
the same contention we rejected with respect to Hayes, we hold that the district court
did not err in denying her motion for judgment of acquittal.
B.
Silvers next asserts that the district court abused its discretion in its response
to a question from the jury because the court referred the jury back to the original jury
instructions instead of specifically answering the question or directing the jury to a
specific jury instruction that did so. “A trial court’s response to a jury’s request for
supplemental instruction is a matter within the sound discretion of the trial court,
which we review for abuse of discretion.” United States v. Hudspeth, 525 F.3d 667,
679 (8th Cir. 2008) (quotation omitted).
-33-
The Hudspeth Court stated, “The trial court must take great care to insure that
any supplemental instructions are accurate, clear, neutral, and non-prejudicial,
answering with concrete accuracy, and within the specific limits of the question
presented.” Id. (quotation omitted). After the jury had begun its deliberations, it sent
a question to the district court, asking: “On Counts 2-11, are we to consider only Ruth
White and Silas Buchanan as regards false statements?” (In Chambers Proceeding Tr.
3.) The district court suggested a response of: “you must be guided by the Court’s
instructions.” (Id.) Silvers’s counsel objected to the proposed answer, stating, in part:
“This is a specific, intelligent question by the jury that has looked at this indictment.
They want a definitive answer and I respectfully believe the Court ought to give them
one. The answer is yes.” (Id. at 4.) The district court overruled the objection,
explaining:
While it does appear they want a definitive answer, I am concerned about
saying either yes or no. The statement, while it appears on reflection
does request a specific answer, I am concerned that giving answers to
specific questions of the jury could create problems in their entire
deliberation on all of the counts . . . so I think the more broad statement
that I have recommended is more appropriate in this matter.
(Id. at 4-5.) Silvers’s counsel then requested that the court give the following answer:
“other than the defendants[,] Ruth White and Silas Buchanan are the only two
individuals named in Counts 2 through 11.” (Id. at 5.) The court denied that request.
(Id.) The court’s response to the jury’s question was: “you must be guided by the
Court’s instructions.” (Id. at 3.)
“This court has recognized that, in responding to a jury’s request for
supplemental instruction, it may be proper at times to simply refer the jury back to the
original instructions.” Hudspeth, 525 F.3d at 679 (quotation omitted). Furthermore,
Silvers’s counsel conceded before the district court that the court “had already given
a definitive answer to this jury on the [jury’s] question . . . ,” referring to the original
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jury instructions which Silvers has not challenged on appeal. (In Chambers
Proceeding Tr. 3.) In effect, counsel’s statement demonstrates that the district court
properly responded to the jury’s question. In light of the accurate and thorough initial
jury instructions given by the district court and counsel’s concession that those
instructions answered the jury’s question, we find no abuse of discretion in the district
court referring the jury back to such instructions.
C.
Finally, Silvers asserts that the district court committed procedural error by
incorrectly calculating her advisory Guidelines range. See Gall, 128 S. Ct. at 597.
She argues that the court clearly erred by increasing her offense level by 14 levels
based on its finding that the amount of loss attributable to her was $545,713. See
USSG §2B1.1(b)(1)(H) (increasing base offense level for fraud by 14 for a loss of
more than $400,000 but less than $1,000,000).
Silvers asserts that the district court’s loss calculation is incorrect because the
court included loss arising before August 2001, and she is not liable for any losses
prior to that date because the government did not offer any evidence of her
involvement in either Complete Care or Watkins Loving Care before August 2001.
Similarly, she contends that $56,885.26, the amount of the overpayment from the
State of Missouri to Complete Care, should not be included because it accrued prior
to August 2001. According to Silvers’s loss calculation, $303,233.30 is attributable
to her as loss. (See Silvers’s Br. 25.) Thus, Silvers asserts that the district court
should have imposed a 12-level enhancement pursuant to USSG §2B1.1(b)(1)(G)
(increasing base offense level for fraud by 12 for a loss of more than $200,000 but less
than $400,000), as opposed to the 14-level enhancement the court imposed under
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USSG §2B1.1(b)(1)(H). “We review for clear error the district court’s factual
findings with respect to the time span of [Silvers’s] involvement in the conspiracy and
the resulting amount of loss attributable to [her].” United States v. Reeves, 83 F.3d
203, 207 (8th Cir. 1996).
At the sentencing hearing, the government’s witness with regard to the amount
of loss was Federal Bureau of Investigation Special Agent James Appelbaum, a
specialist in the investigation of health care fraud for 15 years. (Sentencing Tr. 7-8.)
Agent Appelbaum was the case agent in the prosecution of Silvers and her
codefendants. (Id. at 8.) Agent Appelbaum identified Exhibit 322, which he had
compiled, as a summary of Missouri Medicaid payments to Complete Care and
Watkins Loving Care from March 5, 1999 to July 22, 2005, broken down by client.
(Id. at 14-15; see Gov’t Addendum 1-5.) According to Exhibit 322, the total paid by
Missouri Medicaid to Complete Care and Watkins during this time period was
$2,735,757.98. (Gov’t Addendum 5.)
Agent Appelbaum then explained how the loss resulting from the health care
fraud conspiracy of which Silvers was convicted was $545,731. (Sentencing Tr. 15-
16). Agent Appelbaum explained that he: (1) “identified all the clients that had either
received questionable services, had received no services, [or had received services
from] aides [who] had not been trained properly and we identified about $1.7 million
dollars,” (id. at 15); (2) “refined that [amount] by going only to the clients where trial
testimony was given about either that client or about individual time sheets [regarding
that client] and we came up with a [new] total of . . . $977,665” (id.); (3) “took 50
percent of that total, basically giving the defendants the benefit of the doubt that some
services had been provided and came up with §488,825, paid by Missouri Medicaid
for those clients” (id.); and (4) “added in $56,885.26 which was the amount of [the
overpayment to Complete Care by Missouri Medicaid] and when we added that to the
$488,825, we got a total of $545,773 [a]s our estimated loss” (id. at 15-16). Agent
Appelbaum further explained that the $56,000 overpayment could involve some
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double counting and that was one of the reasons for the 50 percent reduction, which
he stated more than offset any double counting that occurred. (Id. at 20.) Agent
Appelbaum then went client by client, identifying the amount of the claim and why
the claim was questionable and thus included in the amount of loss. (Id. at 16-19.)
The district court imposed a 14-level sentence enhancement after finding
Silvers responsible for a loss of $545,713, see USSG §2B1.1(b)(1)(H); the court also
ordered restitution in that amount. The district court stated, “I determine here that this
defendant was involved in this jointly undertaken criminal activity and that all of the
activities that were involved were foreseeable by her and that she is responsible for
all of those acts.” (Sentencing Tr. 37.); see USSG §1B1.3(a)(1)(A) (providing that
relevant conduct for sentencing purposes includes “all acts and omissions committed,
aided, abetted”); USSG §1B1.3(a)(1)(B) (providing that relevant conduct for
sentencing purposes includes “all reasonably foreseeable acts of other persons taken
in furtherance of the jointly undertaken criminal activity”). The district court
concluded, “[T]he defendant in this case is responsible for all of those losses,
particularly since they were halved to avoid any concern about a precise calculation.”
(Sentencing Tr. 38.)
We conclude that the district court properly “calculate[d] a reasonable estimate
of the loss based upon a preponderance of the evidence.” United States v. Boesen,
541 F.3d 838, 850 (8th Cir. 2008); see United States v. Piggie, 303 F.3d 923, 927 (8th
Cir. 2002) (providing that “[t]he amount of loss need not be determined with
precision”) (quotation omitted)). In addition, although “[t]he conduct of others prior
to the defendant joining the criminal activity does not constitute relevant conduct
under the guidelines,” United States v. Onwumere, 530 F.3d 651, 654 (8th Cir. 2008),
here the government offered evidence that Silvers was involved in Complete Care
prior to August 2001. Johnson testified that Silvers helped Johnson prepare the
Complete Care proposal, which was dated July 15, 1999. (Trial Tr. vol. V, 168-69.)
In sum, neither the district court’s method of calculating the loss nor its inclusion of
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loss resulting from the Complete Care health care fraud conspiracy before August
2001 was clear error. See Reeves, 83 F.3d at 207.
IV.
For the foregoing reasons, we reverse the district court’s denial of Hayes’s
motion for acquittal on count 12, the false statement count, and vacate Hayes’s
conviction and sentence on that count. We affirm Hayes’s conviction on the
conspiracy count. However, we determine that the district court clearly erred in
applying the abuse-of-trust enhancement to Hayes’s offense level and remand for
resentencing on the conspiracy count without the enhancement. The judgment of the
district court as to Hayes is, in all other respects, affirmed. We affirm Silvers’s
convictions and sentence.
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