United States v. Julio Diaz ( 2017 )

FILED
NOT FOR PUBLICATION
DEC 6 2017
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 15-50538
Plaintiff-Appellee, D.C. No.
8:12-cr-00011-CJC-1
v.
JULIO GABRIEL DIAZ, MEMORANDUM*
Defendant-Appellant.
Appeal from the United States District Court
for the Central District of California
Cormac J. Carney, District Judge, Presiding
Argued and Submitted October 6, 2017
Pasadena, California
Before: KLEINFELD, GRABER, and CHRISTEN, Circuit Judges.
Julio Gabriel Diaz, a former physician, was convicted of 79 counts of
distribution of controlled prescription drugs, in violation of 21 U.S.C. § 841(a)(1),
and was sentenced to a term of 327 months in prison. Diaz appeals, assigning
errors to the district court’s evidentiary rulings, its jury instructions, its imposition
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
of a sentence beyond the statutory maximum for counts 86 and 87, and its
acceptance of the drug quantity calculation in the Pre-Sentencing Report (PSR).1
Diaz also argues that the enhancement of his sentence based on facts found solely
by the district court violates the Fifth and Sixth Amendments. We have
jurisdiction pursuant to 28 U.S.C. § 1291, and we affirm Diaz’s conviction but
vacate his sentence and remand to the district court for resentencing.
1. Diaz contends that the district court erred by allowing the government to
introduce evidence of uncharged patient deaths. The use of such evidence here is
troubling, especially because the cause of one of the deaths was, as the government
concedes, cancer, not drug abuse. Moreover, although some of the patient deaths
could have been relevant to prove intent, knowledge, and absence of mistakes,2
FED R. EVID. 404(b), testimony—accompanied by photographs—of the people
whose lives were ruined, allegedly by the easy access to drugs facilitated by Diaz,
was of “extremely limited” probative value. United States v. Brooke, 4 F.3d 1480,
1485 (9th Cir. 1993). But given the voluminous evidence arrayed against Diaz,
1
Diaz’s objection that an expert witness improperly testified as to a legal
conclusion is addressed in an opinion filed concurrently with this memorandum
disposition.
2
For example, Diaz’s statements to Deputy John Coyle in the course of the
latter’s investigations into a patient’s death betrayed his knowledge of that
patient’s “dependency issues.”
2
any error was harmless because “it is more probable than not that the error[] did
not materially affect the verdict.” United States v. Waters, 627 F.3d 345, 358 (9th
Cir. 2010) (internal quotation marks omitted). The inadmissible evidence
comprised a small portion of the witness’s overall testimony, and the government
did not emphasize the prejudicial evidence. See, e.g., United States v. McElmurry,
776 F.3d 1061, 1070 (9th Cir. 2015); Brooke, 4 F.3d at 1486–88.
2. Diaz objects, for the first time on appeal, to some of the testimony by
doctors from local hospitals. The doctors’ out-of-court communications were not
hearsay because they were not offered for the truth of the matter asserted; rather,
they explained why the doctors contacted Diaz about his patients and, later, flagged
him to the authorities. Some of the doctors’ testimony was relevant only as
evidence that Diaz’s prescriptions were so excessive that they could not have been
motivated by genuine medical concern for his patients. Such testimony constitutes
expert opinion,3 and the doctors should not have been allowed to offer it because
they testified as lay witnesses.
Nevertheless, Diaz has not shown that any error affected his substantial
rights. There was ample testimony from expert witnesses that Diaz’s prescription
3
Indeed, the government argued to the jury in closing that: “[T]hese aren’t
lay people. These are other doctors. These are other doctors. They would not do
something like that lightly.”
3
practices were truly egregious and could not have been motivated by legitimate
medical purposes. For example, Dr. Chavez opined that one of Diaz’s patients was
prescribed a quantity of hydrocodone that is three times the maximum dose
typically prescribed. He also stated that the standard procedure is to restrict the
prescription of opiates to one month’s usage rather than the one-year supply that
Diaz doled out to another of his patients. The testimony of the other expert
witness, Dr. Munzing, reinforced the conclusion that Diaz’s methods of pain
management were not tethered to the standard of care set by the medical
profession, and there was no expert testimony to the contrary.
3. Diaz also disputes the admissibility of summary exhibit Gx 1, arguing
first that the government did not lay a proper foundation for the underlying
documents, comprising exhibit Gx 2, and second that Gx 1 was not a proper
summary of Gx 2. Gx 1 and Gx 2 were introduced into evidence through Dr.
Lambert, the case manager of the emergency department at Santa Barbara Cottage
Hospital. Because Dr. Lambert worked with the emergency department’s
computer database, the district court did not abuse its discretion in ruling that a
proper foundation was laid for Gx 2 to be admitted. See United States v. Childs, 5
F.3d 1328, 1334 (9th Cir. 1993). The district court might have erred, however, in
4
admitting Gx 1 into evidence. Gx 1 was grossly misleading4 and went beyond
mere summary. Its defects were so grave that they could have affected not only the
summary’s weight, but also its admissibility. See FED. R. EVID. 1006.
But on the facts of this case, any error was harmless. There was a
tremendous amount of evidence in the record to establish beyond a reasonable
doubt that Diaz did not prescribe the drugs in a good faith attempt to conform to
professional standards for appropriate pain management. Former patients related
that they picked up prescriptions without having been physically examined by
Diaz. Robert Scott testified that he called Diaz after his son, Corey Scott, had been
admitted to the emergency room, to dissuade the doctor from prescribing any more
opiates to Corey. According to Robert Scott, “[Diaz] just basically said, ‘He’s an
adult, he can do whatever he wants.’” A former employee in Diaz’s clinic testified
that she relayed information to Diaz about Adam Montgomery selling his pills, and
that she informed Diaz of track marks on Montgomery’s arms. Diaz also appeared
to have ignored a plea from Dr. Cervantes to stop prescribing drugs to Marlo
Cochrane, a patient whom Dr. Cervantes was treating for addiction and anxiety.
Taryn Reed testified that Diaz would break up her prescriptions, date them
differently, and direct her to different pharmacies where she could have them
4
For example, Gx 1 included prescriptions that were not written by Diaz.
5
filled. Michael Tupper recounted that he apprised Diaz of his emergency room
visits, and strived to reassure the doctor that he had not “throw[n] him under the
bus . . . so to speak.” Diaz thanked Tupper each time. In response to the one time
that Tupper had to be admitted to hospital after suffering a seizure while waiting
for his medication at the pharmacy, Diaz allegedly said: “Next time try to get in
here sooner so that doesn’t happen again.” Taken as a whole, the evidence
overwhelmingly proved that Diaz did not write the charged prescriptions for a
legitimate medical purpose.
4. Diaz claims, for the first time on appeal, that the admission of complaints
made to the Drug Enforcement Agency (DEA) and to the California Medical Board
(CMB) violated his rights under the Confrontation Clause because those
complaints were jointly filed by physicians, several of whom did not testify at his
trial. Because there was sufficient evidence that the local physicians’ complaints
to the DEA and CMB were chiefly motivated by a desire to shield patients, they
were non-testimonial, and the district court did not commit plain error under the
Confrontation Clause by admitting the complaints into evidence. Williams v.
Illinois, 567 U.S. 50, 83–84 (2012).
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5. Towards the close of his testimony, Dr. Chavez was asked: ‘In your
opinion when the defendant wrote the prescriptions with which he has been
charged, was he acting as a medical doctor?.” Dr Chavez responded:
No. In fact, this is more like a drug dealer. You don’t - - you know, if
you're a physician and you prescribe drugs knowing full well they’re
going to be misused, abused, or misdirected, you are actually
potentially worse than a drug dealer because you know better.
A drug dealer doesn’t know better. They’re just there to sell drugs.
But to do this is highly inappropriate, so, yes, there was no legitimate
reason for these drugs.
Diaz belatedly takes exception to Dr. Chavez’s reply on the grounds that it violates
Federal Rule of Evidence 704(b) which prohibits, in a criminal case, an expert
witness from “stat[ing] an opinion about whether the defendant did or did not have
a mental state or condition that constitutes an element of the crime charged or of a
defense.” Because Dr. Chavez’s answer was ambiguous and susceptible of
differing interpretations, the district court did not plainly err by allowing it to be
considered by the jury.
6. For the first time on appeal, Diaz challenges as hearsay CMB Investigator
Garcia’s testimony that Diaz’s medical license was revoked in 2012. The
revocation, which occurred seven months after Diaz was indicted, was relevant
only as evidence that Diaz’s practices were so out of the ordinary that the CMB
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saw fit to ban him from practicing medicine. Offered for this purpose, the
evidence was hearsay and should have been excluded. United States v. Stinson,
647 F.3d 1196, 1210–11 (9th Cir. 2011). Diaz has not established, however, that
any error by the district court affected his substantial rights, and relatively little
time and emphasis were given to the disputed part of Garcia’s testimony.
7. Diaz also faults the jury instructions. But the district court’s jury
instructions track the elements of the crime as spelled out by this court in United
States v. Feingold, 454 F.3d 1001, 1008 (9th Cir. 2006). His argument is therefore
unpersuasive.
In addition, Diaz takes exception to the district court’s refusal to give the
jury his proposed good faith instruction. This contention is also unavailing. First,
a physician who prescribed drugs with “good intentions in the exercise of
professional judgment as to the patient’s needs” cannot have meant to “distribute
or dispense them outside the course of professional practice,” so the jury
instructions that the district court gave adequately covered Diaz’s defense.
Second, this court has repeatedly approved jury instructions that evince an
objective standard for good faith. See United States v. Hayes, 794 F.2d 1348, 1351
(9th Cir. 1986); United States v. Boettjer, 569 F.2d 1078, 1081 (9th Cir. 1978).
Insofar as Diaz’s proposed good faith instruction intimates that his subjective
8
belief in the propriety of his methods should have entitled him to acquittal, the
instruction was mistaken and properly refused by the district court.
8. Diaz asserts that even if each one of the claimed errors is individually
harmless, they collectively operated to deny him a fair trial. “[T]he cumulative
effect of numerous errors may support reversal.” United States v. Lloyd, 807 F.3d
1128, 1168 (9th Cir. 2015) (internal quotation marks omitted). “In those cases
where the government’s case is weak, a defendant is more likely to be prejudiced
by the effect of cumulative errors.” Id. (internal quotation marks omitted). But this
is not such a case. Diaz prescribed more than 5 million opiate pills between 2008
and 2011, with some patients being prescribed, on average, more than 60 tablets
per day. There was also overwhelming evidence attesting to Diaz’s insouciance in
the face of warnings by concerned family members, other physicians, and even his
own employees, that his patients were suffering from drug addiction. The sheer
quantity of drugs that Diaz prescribed, ostensibly for pain management,
convincingly demonstrated that he did not attempt, in good faith, to adhere to the
norms of the American medical profession. Reviewing the record as a whole, “it is
more probable than not that the error[s] did not materially affect the verdict.”
United States v. Morales, 108 F.3d 1031, 1040 (9th Cir. 1997) (en banc).
9
9. Diaz points out, and the government concedes, that the district court
plainly erred by sentencing beyond the statutory maximum on counts 86 and 87.
Diaz also attacks, for the first time on appeal, the drug quantity calculation in his
PSR. We are unable to identify the prescriptions that contributed to the marijuana
equivalent of 181,189 grams as reported in the PSR.5 Nor have we been able to
determine the version of the guidelines that furnished the drug equivalencies
recited by the PSR.6 As the record is too scant to permit appellate review of the
Guidelines calculation, we vacate Diaz’s sentence and remand for resentencing.
See United States v. Emmett, 749 F.3d 817, 820–22 (9th Cir. 2014).
10. Finally, Diaz argues that increasing his sentence from 18 months, based
only on facts found by the jury, to 327 months, based on facts found by the court,
5
Critically, the government was unable to reproduce this figure in its
briefing.
6
The government suggests that the equivalency is the same across the 2011
and 2015 Guidelines – one unit of hydrocodone is to one gram of marijuana – and
that the equivalency between one gram of hydrocodone and 6,700 grams of
marijuana that is reproduced in the PSR is attributable to a “typographical error.”
But the Sentencing Commission amended the Guidelines in 2015 to base the
marijuana equivalency of hydrocodone solely on its weight. U.S.S.G., supp. to
app. C, amend. 793 (eff. Nov. 1, 2015). Under the amendment, one gram of
hydrocodone equaled 6,700 grams of marijuana. Id. Because Diaz was sentenced
on December 7, 2015, it is entirely possible that the PSR employed an equivalency
of one gram of hydrocodone to 6,700 grams of marijuana to arrive at a base level
offense of 38. In any event, remand is required because the government cannot
recreate the calculation.
10
violated the Fifth and Sixth Amendments as construed in Apprendi v. New Jersey,
530 U.S. 466 (2000), and Blakely v. Washington, 542 U.S. 296 (2004). As he
recognizes, this argument is foreclosed by our precedents. United States v. Fitch,
659 F.3d 788, 795–96 (9th Cir. 2011).
Conviction AFFIRMED; Sentence VACATED and REMANDED for
resentencing.
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