United States v. Shapour Motamedi ( 2022 )

NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS JAN 11 2022
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 20-10364
Plaintiff-Appellee, D.C. Nos.
3:18-cr-00554-WHA-1
v. 3:18-cr-00554-WHA
SHAPOUR MOTAMEDI,
MEMORANDUM*
Defendant-Appellant,
and
SHAYAN MOTAMEDI,
Defendant,
HERIBERTO MOISES LOPEZ,
Defendant.
UNITED STATES OF AMERICA, No. 20-10366
Plaintiff-Appellee, D.C. Nos.
3:18-cr-00554-WHA-2
v. 3:18-cr-00554-WHA
SHAYAN MOTAMEDI,
Defendant-Appellant,
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
and
SHAPOUR MOTAMEDI; HERIBERTO
MOISES LOPEZ,
Defendants.
UNITED STATES OF AMERICA, No. 20-10367
Plaintiff-Appellee, D.C. Nos.
3:18-cr-00554-WHA-3
v. 3:18-cr-00554-WHA
HERIBERTO MOISES LOPEZ,
Defendant-Appellant,
and
SHAPOUR MOTAMEDI; SHAYAN
MOTAMEDI,
Defendants.
Appeal from the United States District Court
for the Northern District of California
William Alsup, District Judge, Presiding
Argued and Submitted December 10, 2021
San Francisco, California
Before: WARDLAW, BRESS, and BUMATAY, Circuit Judges.
Concurrence by Judge BUMATAY
Shapour Motamedi, Shayan Motamedi, and Heriberto Moises Lopez
(collectively “Defendants”) pleaded guilty to conspiracy to violate 42 U.S.C. §
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1320a-7b(b), the “Anti-Kickback Statute.” On appeal, they argue that their
convictions should be vacated because a subsection of the Anti-Kickback Statute
known as the “Safe Harbor Provision,” 42 U.S.C. § 1320a-7b(b)(3)(E), violates the
non-delegation doctrine. We have jurisdiction under 28 U.S.C. § 1291, and we
affirm their convictions.
1. The Safe Harbor Provision provides that the Secretary of Health and
Human Services (HHS) may specify by regulation payment practices to which the
“illegal remunerations” prohibitions shall not apply. 42 U.S.C. § 1320a-
7b(b)(3)(E). Thus, the Safe Harbor Provision delegates to the Secretary the ability
to remove certain types of conduct from the scope of the offense defined by statute.
Given the combined operation of the Anti-Kickback Statute and the Safe Harbor
Provision, we conclude that Defendants are challenging their statute of conviction
and thus have standing to assert their non-delegation argument.
2. The delegation in the Safe Harbor Provision is constitutional,
however, because Congress has supplied HHS with an “intelligible principle” to
guide the Secretary’s discretion in setting those bounds.1 United States v. Gundy,
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Defendants argue that that we should dispense with the traditional “intelligible
principle test” for determining whether a statute violates the non-delegation
doctrine, and adopt the stricter test proposed by Justice Gorsuch in his dissent in
United State v. Gundy, 139 S. Ct. 2116, 2129, reh’g denied, 140 S. Ct. 579 (2019).
However, as the Defendants acknowledge, “[w]e are bound to follow a controlling
Supreme Court precedent until it is explicitly overruled by that Court,” and the
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139 S. Ct. 2116, 2123 (plurality op.), reh’g denied, 140 S. Ct. 579 (2019). Under
modern precedent, the intelligible principle test imposes “an exceedingly modest
limitation.” United States v. Melgar-Diaz, 2 F.4th 1263, 1266 (9th Cir. 2021); see
also Gundy, 139 S. Ct. at 2129 (plurality op.) (explaining that the intelligible
principle test is “not demanding”). For example, the Supreme Court has upheld the
delegation of broad conferrals of authority to regulate “in the public interest,”
National Broadcasting Co. v. United States, 319 U.S. 190, 216 (1943), to set “fair
and equitable prices,” Yakus v. United States, 321 U.S. at 422, 427 (1944), to set
“just and reasonable rates,” FPC v. Hope Natural Gas Co., 320 U.S. 591 (1944),
and to issue air quality standards that are “requisite to protect the public health.”
Whitman v. American Trucking Association, 531 U.S. 457 (2001).
In this case, the instructions Congress provided to HHS are much more
specific than the instructions the Supreme Court has upheld against non-delegation
challenges. Congress gave the Secretary a list of nine factors to consider when
promulgating exceptions to the criminal prohibition under the Safe Harbor
Provision. See 42 U.S.C. § 1320a-7d(a)(2). Those nine factors direct the Secretary
to consider whether adding a safe harbor would improve the quality of healthcare
intelligible principle test remains the standard for determining whether the
delegation of legislative power is constitutional. Nunez-Reyes v. Holder, 646 F.3d
684, 692 (9th Cir. 2011); see also Miller v. Gammie, 335 F.3d 889, 893 (9th Cir.
2003) (en banc).
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in the United States in general by doing things like improving “access to healthcare
services,” improving the “quality of health care services,” and reducing incentives
for doctors to “overutiliz[e]” healthcare services. Id. The delegation in the Safe
Harbor Provision is, therefore, constitutional.
Defendants make two arguments in response, neither of which has merit.
First, they argue that whatever guidance Congress provided in 42 U.S.C. § 1320a-
7d(a)(2) is vitiated by the catchall section, § 1320a-7d(a)(2)(I), which permits the
Secretary to consider “[a]ny other factors the Secretary deems appropriate in the
interest of preventing fraud and abuse in Federal health care programs (as so
defined).” They contend that this “catchall clause” allows the Secretary to
consider anything she wants, so her discretion isn’t cabined at all.
We disagree. For one, even considered in isolation, § 1320a-7d(a)(2)(I)
provides an intelligible principle to guide the Secretary’s discretion. The Secretary
is directed to consider “other factors” to the extent that they serve the interest of
preventing “fraud and abuse in Federal health care programs.” 42 U.S.C. § 1320a-
7d(a)(2)(I). That instruction reflects an intelligible principle: it is possible to
evaluate whether a particular safe harbor promulgated by the Secretary is likely to
prevent fraud and abuse or not. And again, that direction, even standing alone, is
more stringent a guardrail than guidelines the Court has upheld in the past, such as
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regulating “in the public interest,” National Broadcasting Co., 319 U.S. at 216, or
setting “just and reasonable” rates, Hope Natural Gas Co., 320 U.S. at 591.
Defendants also argue that even if 42 U.S.C. § 1320a-7d(a)(2) provides
sufficient guidance in the context of a civil statute, Congress should be required to
provide more guidance in the context of a criminal statute, relying on Touby v.
United States, 500 U.S. 160 (1991). However, there, the Supreme Court said only
that its case law was “not entirely clear as to whether more specific guidance is in
fact required” in the context of a criminal statute, declining to resolve that question
because the statute at issue “passe[d] muster even if greater congressional
specificity is required in the criminal context.” Id. at 166. Similarly here, we need
not decide that question because, as discussed above, Section 7d(a)(2) clearly
provides an intelligible principle which passes muster “even if greater
congressional specificity is required in the criminal context.” Id.AFFIRMED.
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FILED
United States v. Motamedi, et al., Nos. 20-10364, 20-10366, 20-10367 JAN 11 2022
BUMATAY, Circuit Judge, concurring:
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
I agree we should affirm the Appellants’ convictions here, but I would do so
without reaching the merits of their non-delegation claim. I thus concur in the
judgment of the court only.
The Appellants were convicted of conspiracy to violate 42 U.S.C. § 1320a-
7b(b)—the Anti-Kickback Statute. See 18 U.S.C. § 371. The Anti-Kickback Statute
makes it a felony to receive or pay kickbacks, bribes, or rebates in return for
purchasing “any item or service for which payment may be made in whole or in part
under a Federal health care program.” 42 U.S.C. § 1320a-7b(b)(1), (b)(2). The
Statute, however, establishes various safe harbors to criminal liability. See 42 U.S.C.
§ 1320a-7b(b)(3). One of those safe harbors invites the Secretary of Health and
Human Services to promulgate regulations exempting certain “payment practice[s]”
from criminal liability under the Statute. 42 U.S.C. § 1320a-7b(b)(3)(E).
In yet another law, Congress provided criteria to HHS for establishing and
modifying these safe harbors. 42 U.S.C. § 1320a-7d(a)(2). This law set out eight
relatively specific factors for HHS to consider in adopting or amending a safe harbor
regulation. See 42 U.S.C. § 1320a-7d(a)(2)(A)–(H). But the law ends with what’s
been called a “catchall provision”—permitting HHS to consider “[a]ny other factors
the Secretary deems appropriate in the interest of preventing fraud and abuse in
Federal health care programs.” 42 U.S.C. § 1320a-7d(a)(2)(I). It is here that the
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Appellants complain.
Appellants contend that this catchall provision grants HHS almost unfettered
authority to decide which actions are criminal under the Anti-Kickback Statute with
no meaningful congressional guidance. They claim that such a provision violates
the non-delegation doctrine as traditionally understood, see Mistretta v. United
States, 488 U.S. 361, 372 (1989), and especially under the robust non-delegation
view articulated by Justice Gorsuch, see Gundy v. United States, 139 S. Ct. 2116,
2131 (2019) (Gorsuch, J., dissenting). They then ask us to reverse their convictions
based on the violation of the non-delegation doctrine.
There’s one problem with that: Assuming they are right—that the catchall
provision provides no “intelligible principle” and thus Congress has
unconstitutionally delegated its authority to HHS—the catchall provision is easily
severable from the Anti-Kickback Statute. “Unless it is evident that the legislature
would not have enacted those provisions which are within its power, independently
of that which is not, the invalid part may be dropped if what is left is fully operative
as law.” United States v. Taylor, 693 F.2d 919, 921–22 (9th Cir. 1982) (quoting
United States v. Jackson, 390 U.S. 570, 585 (1968)). Given the text, structure, and
chronological development of the Anti-Kickback Statute and the safe harbor
regulations, I find it unlikely that Congress would have chosen to discard the entire
law prohibiting kickbacks if it could not also include the catchall provision for
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establishing safe harbors. See id. at 922.
So even if we were to strike the catchall provision as a violation of the non-
delegation doctrine, the rest of the Anti-Kickback Statute would remain fully
operative and Appellants’ convictions under § 1320a-7b(b) and 18 U.S.C. § 371would be untouched. Id. I thus join the majority in affirming their convictions.
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