United States v. Akinyoyenu , 201 F. Supp. 3d 82 ( 2016 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
UNITED STATES OF AMERICA
v. Criminal Action No. 15-42 (JEB)
TITILAYO AKINTOMIDE
AKINYOYENU,
Defendant.
MEMORANDUM OPINION
Defendant Titilayo Akinyoyenu once ran a pharmacy in Washington, D.C., and, for some
time, another one online. His internet agora allowed customers to purchase a melange of
medications. Customers, however, did not need to submit their own prescriptions when
ordering; instead, they filled out short medical questionnaires, which Akinyoyenu’s network of
doctors – including Co-Defendant Alan Saltzman – reviewed summarily before prescribing the
drugs sought in the orders. In 2015, a grand jury returned an Indictment charging Defendant
with several drug-related offenses and, as relevant here, conspiracy to commit mail fraud.
As one of several pretrial motions to dismiss, Akinyoyenu now asserts that his mail-fraud
count fails to state an offense because he did not deprive anybody of money or property. By his
theory, customers received the drugs they ordered at the price they agreed to pay, so they lost
nothing. Because this cabined view of mail fraud misunderstands the nature of that offense, the
Court will, for the most part, deny Defendant’s Motion.
I. Background
The Court gleans its understanding of the case by assuming as true the facts set forth in
the Indictment. See United States v. Ballestas, 795 F.3d 138, 149 (D.C. Cir. 2015).
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Akinyoyenu was a pharmacist who owned and operated Apex Care Pharmacy here in
Washington. See Indictment, Count One, ¶ 8. As the Internet age dawned, Defendant innovated.
He hired a technology firm to design an online expansion to his brick-and-mortar business. Id.,
¶ 17. The resulting websites – apexonlinepharmacy.com and bynextday.com – operated from
January 2005 to June 2010 and offered for sale dozens of medications. Id., ¶¶ 12, 17-18.
Defendant’s websites allowed visitors to place orders, but informed them that all orders
would require a valid prescription up front. Id., ¶ 19. Specifically, the websites stated:
apexonlinpharamacy.com does not prescribe medication directly.
The physician has the ultimate authority to diagnose a medical
condition and/or offer a treatment option. All orders require a
prescription from your doctor or other health care professional that
is licensed in the United States to write prescriptions for medicine.
Id. This was not entirely true – for a few reasons. To start, Akinyoyenu never required
customers to provide their own prescriptions. Id., ¶¶ 18-20. Defendant also did offer
prescription services directly. Customers would fill out an online medical questionnaire when
completing their orders; Defendant then forwarded those questionnaires to his affiliated doctors –
e.g., Saltzman – who, for a fee, summarily approved the drug orders while issuing prescriptions
for those drugs. Id. And finally, by requiring a prescription in the first place, Akinyoyenu
implied that these rubberstamp prescriptions were somehow sound and legal stand-ins (or never
told customers otherwise). Id., ¶¶ 18-21. All in all, he reaped over $8 million in sales by selling
and shipping drugs. Id., ¶ 22.
Displeased with these unscrupulous dealings, the Government indicted Akinyoyenu and
Saltzman in March 2015. The Indictment listed three drug offenses as well as a fourth charge of
mail-fraud conspiracy. As to the last, the pair allegedly engaged in a “scheme to defraud online
drug customers, and federal and state regulatory agencies,” of money or property by making
false representations in these prescription-drug sales. Id., Count Four, ¶ 2.
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Defendant now moves to dismiss this last count on the ground that it fails to state an
offense.
II. Legal Standard
Before trial, a defendant may move to dismiss an indictment (or specific counts) on the
basis that it fails to state an offense – i.e., that “the indictment does not charge a crime against the
United States.” United States v. Cotton, 535 U.S. 625, 631 (2002) (quoting Lamar v. United
States, 240 U.S. 60, 65 (1916)); see Fed. R. Crim P. 12(b)(3)(B)(v) & 2014 advisory committee
notes; Al Bahlul v. United States, 767 F.3d 1, 10 n.6 (D.C. Cir. 2014) (“Failure to state an offense
is simply another way of saying there is a defect in the indictment.”). The operative question is
whether the allegations in the indictment, if proven, permit a jury to conclude that the defendant
committed the criminal offense as charged. See United States v. Sanford, Ltd., 859 F. Supp. 2d
102, 107 (D.D.C. 2012); United States v. Bowdoin, 770 F. Supp. 2d 142, 146 (D.D.C. 2011).
In reviewing the indictment, the court affords deference to the “fundamental role of the
grand jury.” Ballestas, 795 F.3d at 148 (quoting Whitehouse v. U.S. Dist. Court, 53 F.3d 1349,
1360 (1st Cir. 1995)). As a result, “[a]dherence to the language of the indictment is essential
because the Fifth Amendment requires that criminal prosecutions be limited to the unique
allegations of the indictments returned by the grand jury.” United States v. Hitt, 249 F.3d 1010,
1016 (D.C. Cir. 2001). The court accordingly cabins its analysis to “the face of the indictment
and, more specifically, the language used to charge the crimes.” United States v. Sunia, 643 F.
Supp. 2d 51, 60 (D.D.C. 2009) (emphases and internal quotation marks omitted).
III. Analysis
Although the mail-fraud statute’s language is hardly pellucid, the crime consists of two
basic elements: (1) a scheme to defraud another of money or property (2) through use of the
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mail. United States v. Coughlin, 610 F.3d 89, 97 (D.C. Cir. 2010); see 18 U.S.C. § 1341.
Akinyoyenu’s several challenges center around whether the first element is properly stated in the
Indictment. The Court addresses two of his claims in prefatory fashion before homing in on the
nub of his Motion – whether the Indictment sufficiently alleges that any customers lost actual
money or property.
To begin, Akinyoyenu contends that there is no plausible legal theory that could support
the Indictment’s contention that he participated in “a scheme to defraud . . . federal and state
regulatory agencies.” Mot. at 4, 6-7 (quoting Indictment, Count Four, ¶ 2). As the Government
both concedes that its inclusion of agencies as purported victims was in error and represents that
it will not pursue this theory at trial, the Court strikes the words “and federal and state regulatory
agencies” in Count Four as irrelevant to this case and as prejudicial in making the scheme seem
more grandiose than it was. See United States v. Oakar, 111 F.3d 146, 157 (D.C. Cir. 1997)
(holding surplus language “may only be stricken if it is irrelevant and prejudicial”).
Defendant next claims that the Indictment fails to state an offense because it alleges only
that he participated in “a scheme to defraud online drug customers” and does not specify how he
defrauded them of money or property. Problems abound with this argument. First of all, it
appears only in Akinyoyenu’s Reply. Compare Reply at 2-3 (making argument), with Mot. at 4
(quoting relevant case once in applicable-law section). Even were the Court to consider the
point, a failure-to-state-an-offense motion is not the correct vehicle for such an objection, as “a
scheme to defraud” precisely mirrors the statutory language. See 18 U.S.C. § 1341(criminalizing “any scheme or artifice to defraud”). What Akinyoyenu means to bring is a
challenge to the Indictment’s specificity under Federal Rule of Criminal Procedure 7(c)(1),
which requires “a plain, concise, and definite written statement of the essential facts constituting
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the offense charged.” Generously construing this as a Rule 7(c)(1) argument, then, the Court is
nonetheless satisfied that the Rule’s minimal sufficiency requirements are met. “[A]n indictment
need only inform the defendant of the precise offense of which he is accused so that he may
prepare his defense and plead double jeopardy in any further prosecution for the same offense.”
United States v. Verrusio, 762 F.3d 1, 13 (D.C. Cir. 2014). The how that Akinyoyenu claims he
is not informed of is manifest. Count Four – in effect, fifteen pages long – depicts an online
pharmaceutical scheme to sell drugs to customers while deceiving them as to the soundness of
their prescriptions. See Indictment, Count Four, ¶¶ 3-4 (incorporating Indictment, Count One,
¶¶ 17-27, and Overt Acts, ¶¶ 1-14); e.g., id., Count One, ¶¶ 18-21 (describing improper
prescription process despite website language stating valid prescriptions were required).
With these two appetizers cleared away, Akinyoyenu cooks up his main course. He
contends that the Indictment does not charge that customers were actually deprived of either
money or property because, allegedly, “[t]hey received exactly what they ordered.” Mot. at 5.
Put very simply: no harm, no foul.
Let’s dig in. The money-or-property requirement does appear on the face of the mail-
fraud statute, see 18 U.S.C. § 1341, and in some other circuits is a separate element. See, e.g.,
United States v. Binday, 804 F.3d 558, 569 (2d Cir. 2015). Yet the definition of these two words
is not immediately apparent. Fortunately, jurisprudence on the meaning of “property” in mail-
and wire-fraud cases illuminates both terms’ meanings. The Supreme Court has specified, first,
that “intangible rights” are not “property,” see McNally v. United States, 483 U.S. 350 (1987),
but added that “intangible property rights” do constitute valuable property interests within the
meaning of the statute. Carpenter v. United States, 484 U.S. 19, 25-27 (1987) (emphasis added).
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These intangible property rights include the “right to decide how to use” one’s property.” Id. at
26.
The same principles apply to “money.” An individual’s “right to control how [his]
money is spent” is also a recognized monetary interest for the purposes of mail fraud. United
States v. Trie, 21 F. Supp. 2d 7, 20 (D.D.C. 1998) (citing United States v. Madeoy, 912 F.2d
1486, 1492 (D.C. Cir. 1990)). The basic premise is that depriving individuals of information
necessary to evaluate their monetary transactions is prohibited, as that deprivation in itself strips
the gainful value of their capital. See United States v. Carlo, 507 F.3d 799, 802 (2d Cir. 2007)
(predicating theory on deprivations of “information necessary to make discretionary economic
decisions”); e.g., Trie, 21 F. Supp. 2d at 13 (where defendants affected Democratic National
Committee’s spending by concealing information that donations were “foreign money”).
Although misinformation comes in many forms, this Indictment does not simply rest on some
immaterial, errant website disclaimer, but on misrepresentations that go to the heart of
pharmaceutical purchases: the validity, necessity, and legality of prescriptions. See United States
v. Shellef, 507 F.3d 82, 108 (2d Cir. 2007) (“Our cases have drawn a fine line between schemes
that do no more than cause their victims to enter into transactions they would otherwise avoid –
which do not violate the mail or wire fraud statutes – and schemes that depend for their
completion on a misrepresentation of an essential element of the bargain – which do violate the
mail and wire fraud statutes.”). In fact, it is even arguable that prescriptions are so central to the
product that legally acquired drugs are qualitatively different as property from illegally acquired
drugs.
In any event, whatever the precise theoretical contours of this case, it is well recognized
that prosecutors may charge a “right to control” theory of mail (and wire) fraud. See, e.g.,
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Madeoy, 912 F.2d at 1492; United States v. Bucuvalas, 970 F.2d 937, 945 (1st Cir. 1992),
abrogated on other grounds by Cleveland v. United States, 531 U.S. 12 (2000); United States v.
Wallach, 935 F.2d 445, 463 (2d Cir. 1991); United States v. Hedaithy, 392 F.3d 580, 603 (3d Cir.
2004); United States v. Gray, 405 F.3d 227, 234 (4th Cir. 2005); United States v. Fagan, 821 F.2d
1002, 1011 n.6 (5th Cir. 1987); United States v. Kerkman, 866 F.2d 877, 880 (6th Cir. 1989);
United States v. Catalfo, 64 F.3d 1070, 1077 (7th Cir. 1995); United States v. Shyres, 898 F.2d
647, 652 (8th Cir. 1990); United States v. Welch, 327 F.3d 1081, 1108 (10th Cir. 2003); United
States v. Cross, 928 F.2d 1030, 1044 (11th Cir. 1991).
As must be apparent from the lengthy string citation above, however, Ninth Circuit case
law is less clear-cut, and Akinyoyenu principally relies on a case from that circuit, United States
v. Bruchhausen, 977 F.2d 464 (9th Cir. 1992). See Mot. at 5-6; see also 2 Leonard B. Sand,
Modern Federal Jury Instructions – Criminal, ¶ 44-3 cmt. (2016) (documenting “differing
approaches of the Ninth Circuit and the other courts”). Without casting any aspersions on the
West Coast, the Court merely observes that Bruchhausen is inapposite. At issue there was
whether the mail-fraud statute protected sellers to a distributor who claimed a right to control
whether their sold goods ended up in the Soviet Bloc, and the Ninth Circuit answered in the
negative. See Bruchhausen, 977 F.2d at 467-68 (denying that “a manufacturer has a property
interest in the destination of its products.”). Fairly read, the takeaway of that case is simply that
individuals might have a right to control their transactions but no right as to later transactions.
This Indictment, however, does not introduce some far-flung notion that customers were
deprived of their right to control Akinyoyenu’s later use of the money that he fraudulently
obtained from them. Instead, it alleges a theory squarely within the bounds of well-established
right-to-control case law (though it does not utter the magic words “right to control” or “right to
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decide”). Count Four describes a scheme to defraud customers of “money, property, and things
of value” through fraudulent representations. See Indictment, Count Four, ¶ 2. To wit,
Akinyoyenu falsely expressed to customers that the prescriptions accompanying their
transactions would be valid (or neglected to tell them otherwise). See id., Count One, ¶ 21. The
online buyers were, allegedly, duped into purchasing prescription drugs both without knowing
whether they really needed those drugs and without realizing that the transactions were illicit.
Because those misrepresentations might have influenced their choice of whether to even make
purchases in this setting, the Indictment sufficiently states a fraudulent deprivation of money or
property.
IV. Conclusion
For the reasons set forth above, the Court will grant in part and deny in part Defendant’s
Motion in a separate Order to be issued this day.
/s/ James E. Boasberg
JAMES E. BOASBERG
United States District Judge
Date: August 23, 2016
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