United States v. Vega

United States Court of Appeals
For the First Circuit
No. 14-1794
UNITED STATES OF AMERICA,
Appellee,
v.
LUZ M. VEGA,
Defendant, Appellant.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO
[Hon. Gustavo A. Gelpí, U.S. District Judge]
Before
Torruella, Lipez, and Thompson,
Circuit Judges.
Rachel Brill, for appellant.
Héctor E. Ramírez-Carbo, Assistant United States Attorney,
with whom Rosa Emilia Rodríguez-Vélez, United States Attorney,
Nelson Pérez-Sosa, Assistant United States Attorney, Chief,
Appellate Division, and Juan Carlos Reyes-Ramos, Assistant United
States Attorney, were on brief, for appellee.
March 2, 2016
TORRUELLA, Circuit Judge. A jury convicted defendant-
appellant Luz M. Vega of fifty-eight criminal counts stemming from
her participation in a Medicare fraud scheme. Vega now appeals
her convictions from the United States District Court for the
District of Puerto Rico, alleging several procedural defects.
Additionally, although Vega does not challenge her Medicare fraud
convictions, she argues the Government did not present sufficient
evidence to convict her of identity theft and money laundering.
For the reasons that follow, we affirm.
I. Background
Vega was the director of Preferred Medical Equipment
("Preferred"), a supplier of durable medical equipment ("DME")
located in Arecibo. DME are items used by individuals with certain
medical conditions outside of a hospital on regular basis, such as
wheelchairs, walkers, orthotics, and electric hospital beds.
Typically, a patient obtains DME through a DME supplier upon the
presentation of a physician order. If the patient is a Medicare
beneficiary, the DME supplier can submit a claim to Medicare for
partial reimbursement.1
1 In the Medicare claim, the DME supplier states how much the
beneficiary was billed for the equipment. Up to a set price point,
Medicare will fully reimburse a DME supplier, factoring in an
expected twenty-percent copay by the beneficiary.
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DME suppliers seeking reimbursement from Medicare must
submit documentation with their claim, including proof that the
DME ordered was medically necessary and prescribed by a physician.
Due to the volume of claims received, Medicare does not verify
every claim it receives beyond checking for paperwork showing that
the DME recipient was a Medicare beneficiary and the DME was
medically necessary.
Preferred defrauded Medicare by submitting claims for
DME orders that were not medically necessary. Rather than waiting
for beneficiaries to come with physician orders to fulfill,
"equipment coordinators" at Preferred would seek out Medicare
beneficiaries and persuade them to receive DME, often under the
pretense that the equipment was free. The absence of
documentation showing the DME ordered was medically necessary
would normally prevent Medicare reimbursement. Preferred's
equipment coordinators circumvented this rule by paying a doctor,
Francisco A. Garrastegui-Bigas ("Garrastegui"), to provide the
required documentation. Garrastegui would either create
documentation for DME already ordered, or accompany the equipment
coordinators on patient visits and prescribe DME on the spot.
The Government jointly indicted Vega; Garrastegui;
Preferred's secretary, María Elisa Pérez; and two of Preferred's
equipment coordinators, Lissette Acevedo-Rodríguez ("Acevedo") and
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Luisa Nieves, alleging that Preferred submitted ninety-five false
claims totaling $210,223.47 to Medicare between April 2010 and
March 2011. For her role in this scheme, the Government charged
Vega with one count of conspiracy to commit Medicare fraud in
violation of 18 U.S.C. §§ 1347 and 1349 and twenty-four counts of
aiding and abetting the commission of health care fraud in
violation of 18 U.S.C. §§ 2 and 1347.2
Vega also faced several other criminal charges in
connection with her participation in Preferred's fraud scheme.
For payments made to Preferred's equipment coordinators and
Garrastegui, Vega was charged with twenty-eight counts of aiding
and abetting the solicitation and receipt of kickbacks in relation
to the Medicare program, in violation of 42 U.S.C. §§ 2 and 1320a-
7b(b)(1)(B). Vega paid commissions to Preferred's equipment
coordinators based on the type and quantity of DME they sold.
Additionally, Vega paid Garrastegui to visit Preferred's office in
late 2010 to create medical documentation for DME that Preferred
had sold without physician orders.3
2 These twenty-four counts were based on claims Preferred filed
for DME given to three different beneficiaries.
3 Count 29 was in regard to Vega paying Garrastegui for when he
visited Preferred's office. Counts 30-54 were in regards to
payments Vega made to Acevedo. Counts 55-56 were in regard to
payments Vega made to Nieves.
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The Government also charged Vega with three counts of
aiding and abetting aggravated identify theft in violation of 18
U.S.C. § 1028A(a)(1) and (2). These aggravated identity theft
charges were in relation to Preferred obtaining the identification
information of three Medicare beneficiaries -- Juan Quiles-Medina
("Quiles"), José Figueroa-Class ("Figueroa"), and Efraín Toro-
Morales ("Toro") -- and continuing to bill Medicare on their behalf
even after they told Preferred they did not want the equipment.
Finally, Vega was charged with two counts of transacting
in criminally derived property of a value greater than $10,000
(i.e., money laundering) because she used funds from Preferred's
bank account to pay for personal expenses (an auto loan and the
purchase of an official check).
Garrastegui and Acevedo both pled guilty and testified
against Vega at trial. The jury found Vega guilty of all counts.
The district court sentenced Vega to two years and one day of
imprisonment and three years of supervised release. This timely
appeal followed.
II. Napue Claims
Vega first argues that the Government violated Napue v.
Illinois, 360 U.S. 264 (1959), and her right to due process by
allowing two of its witnesses to provide false testimony to the
jury. Napue prohibits prosecutors from knowingly presenting false
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evidence, including false testimony, to the jury. Id. at 269-70;
see also United States v. Flores-Rivera, 787 F.3d 1, 31 (1st Cir.
2015). This prohibition applies even if the government does not
solicit the false testimony and merely fails to correct it. Napue,
360 U.S. at 269.
According to Vega, two of Preferred's equipment
coordinators who testified against her at trial, Acevedo and
Marcos A. Sárraga-Montañez ("Sárraga"), underrepresented the
benefits they received from their plea agreements.4 This in turn,
Vega argues, prevented the jury from fully assessing their bias
and credibility. We reject Vega's Napue claims for two reasons.
First, we note that Vega did not object to Acevedo's or
Sárraga's testimony, even though the Government entered their plea
agreements into evidence at trial and, as discussed in further
detail below, the plea agreements contained all of the information
Vega needed to impeach their testimony. If a defendant has actual
knowledge of the false testimony and fails to correct it, absent
unusual circumstances, we assume the defendant did so for strategic
4 Acevedo and Sárraga were also involved in a similar Medicare
fraud scheme with a different DME supplier called Monte Mar.
Acevedo was charged in connection with Monte Mar and Preferred and
pled guilty to one count of conspiracy to commit health care fraud
in both cases and one count of aggravated identity theft in the
Preferred case. Sárraga was only charged in connection with Monte
Mar and pled guilty to one count of soliciting and receiving
kickbacks in relation to the Medicare program in that case.
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reasons and consider the Napue claim waived. United States v.
Mangual-García, 505 F.3d 10, 10-11 (1st Cir. 2007). Given the
availability of the plea agreements, we do not think Vega has
reason to complain about either witness's testimony on appeal.
Second, even if Vega's claims are reviewable, they are
meritless.
A. Acevedo's Testimony
Vega contests a portion of Acevedo's testimony elicited
on recross-examination. Following Acevedo's statement that she
was repentant, Vega asked Acevedo if she "ha[d] to return the money
that [she] received" from her crimes; Acevedo, who had yet to be
sentenced, stated that she did not know. The district court then
told the jury that Acevedo's plea agreement, whatever its terms,
was not binding and that the court "c[ould] order full restitution"
and it was "up to the Court, the amount of restitution."
Vega argues that the prosecutors (and district court
with its comment) left the jury with an impression that Acevedo
did not receive a benefit from the Government by pleading guilty
because restitution was still up to the district court's
discretion. This impression is false, according to Vega, because
discretionary restitution is a benefit.
Vega premises her argument on the Mandatory Victim's
Restitution Act ("MVRA"), 18 U.S.C. § 3663A, which requires
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defendants to pay restitution in fraud cases. See id.
§ 3663A(c)(1)(ii); United States v. Cheal, 389 F.3d 35, 53 (1st
Cir. 2004). Vega argues that Acevedo's plea agreements must have
exempted her from the MVRA if the prosecutors and district court
viewed her restitution as a matter of court discretion.
The problem with Vega's argument is that Acevedo's plea
agreements did not exempt her from the MVRA -- in fact, her plea
agreements explicitly state that the MVRA applied. The benefit
Vega argues Acevedo lied about receiving simply does not exist.5
We also find no falsity in Acevedo's statement that she
did not know the amount of restitution she would have to pay.
Restitution has a precise legal definition. It is not
unreasonable that Acevedo would not know this definition and thus
how the district court would calculate restitution or how much it
would order her to pay. Finally, we fail to see how any problems
with Acevedo's testimony could not have been impeached by Vega
when Vega had a copy of Acevedo's plea agreement and the plea
agreement stated the terms of Acevedo's restitution and monetary
penalties. Based on this review of the record, we conclude that
5 Vega seems to argue that because Acevedo ultimately did not pay
any restitution she must have been exempted from the MVRA. The
district court's restitution calculation is not before us and Vega
has failed to point us to any evidence suggesting that the plea
agreement terms were altered prior to sentencing. We therefore
assume the MVRA applied pursuant to the plea agreement's terms.
-8-
Acevedo's testimony was not false and therefore did not violate
Napue.
B. Sárraga's Testimony
Our review of the record also leads us to conclude that
Sárraga's testimony did not violate Napue. Sárraga's contested
testimony came during his redirect examination when the
prosecution attempted to bolster his credibility following Vega's
attacks on cross-examination:
PROSECUTOR: And you have already been sentenced . . .;
is that correct?
SÁRRAGA: Yes.
PROSECUTOR: So what do you have to lose or win by
coming here to testify?
SÁRRAGA: From the very first time that I had contact
with an agent, I decided that I was going to tell the
truth and made a commitment to tell the truth and help
them out.
PROSECUTOR: Are you getting anything in return or do
you fear something will happen to you by coming here
and testifying today?
SÁRRAGA: No.
Vega argues that Sárraga's statement that he was not receiving
anything in return for his testimony was false because he was still
on probation and was required to pay restitution and thus had an
incentive to "please the government with his testimony."
Like Acevedo's testimony, we do not see any obvious
falsity in Sárraga's statement. Sárraga had already been
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sentenced such that the main source of his bias -- wanting to
receive a favorable recommended sentence from the prosecution --
was mitigated. The prosecution's ability to influence Sárraga's
probation and restitution seems attenuated at best. Moreover,
even if Sárraga's statement that he was receiving nothing in return
for his testimony was misleading, Vega could easily cross-examine
his motives -- and in fact did so. See United States v. Clark,
767 F. Supp. 2d 12, 67 (D.D.C. 2011) (stating conflicting testimony
between witnesses did not create Napue claim because even if a
witness's testimony contains falsehoods, "cross-examination and
jury instructions regarding witness credibility will normally
purge the taint of false testimony" (quoting United States v.
Joyner, 201 F.3d 61, 82 (2d Cir. 2000)). Thus, even if Sárraga's
testimony could be construed as misleading, we do not find "any
reasonable likelihood" that the testimony could "have affected the
judgment of the jury.6 Mangual-García, 505 F.3d at 10 (quoting
6 We also reject Vega's argument that the district court made an
improper and misleading comment to the jury about plea agreements
generally. While Sárraga was describing his plea agreement on
direct, the district court interjected and told the jury:
You've heard other witnesses who are cooperating with
the United States and have plea agreements, they have
not yet been sentenced. The sentence is ultimately
for the Court to decide, and the fact that [Sárraga]
got 18 months is not indicative of how any of the
other individuals will be sentenced that's ultimately
a decision for the Court on a case-by-case-basis.
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Giglio v. United States, 405 U.S. 150, 154 (1972)). As a result,
we proceed to Vega's evidentiary claims.
III. Evidentiary Issues
Vega next argues that the Government improperly
introduced expert testimony without qualifying the witnesses as
experts. Vega's claim relates to the testimony of two Government
witnesses: Jean Stone ("Stone") and Special Agent Michael Ayala
("Ayala"). We are dubious about the propriety of portions of
their testimony, but ultimately find Vega's alleged errors
harmless given her theory of defense.
Stone held a management position with the United States
Department of Health and Human Services, where she helped oversee
Medicare fraud prevention activities in New York, New Jersey,
Puerto Rico, and the Virgin Islands. Stone did not assist with
the investigation of Vega or Preferred -- rather, the Government
gave Stone a copy of the indictment against Vega and asked Stone
to testify about the Medicare program generally. During the
Vega argues this statement was misleading because the witnesses
were assigned to the same judge and he ultimately gave other
witnesses the same sentence as Sárraga (eighteen months'
probation). Vega claims the district court judge's statement
prevented her from arguing that other witnesses would not face
jail time. We do not see how the district court's statement was
false given that each sentence was up to the court's discretion.
And, similar to Vega's claim regarding Sárraga's testimony, we do
not see how Vega was prevented from making any arguments about
witness bias on cross-examination.
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course of her testimony, Stone described the structure of the
Medicare program; how DME was prescribed and could be obtained by
patients; how DME suppliers received reimbursement; and how
Preferred's Medicare reimbursement claims showed conflicting DME
prescriptions.7
On appeal, Vega contests the portion of Stone's
testimony in which she described the anti-kickback statute. Stone
testified that a DME supplier could not pay an equipment
coordinator commissions because the anti-kickback statute made it
illegal "to offer or receive anything of value for referrals of
Medicare or Medicaid patient [sic] to receive Medicare service or
equipment."
Vega contests a similar statement made by Ayala, a U.S.
Secret Service agent who executed a search warrant of Preferred's
office in April 2011. At trial, Ayala testified he found a chart
during the search that listed different DME, the price Preferred
paid for DME, the amount Medicare reimbursed for that DME, and a
column called "Rep. Payment."8 Ayala testified that he believed
7 For example, Stone stated that one of Preferred's claim forms
ordered both a pressure-reducing mattress -- used for immobile
patients who developed severe ulcers due to the pressure from their
bones pressing on their skin -- and a back brace -- used to help
patients' spines recover following surgery. As Stone explained,
it was not appropriate for a patient who was immobile to also have
a device used to stabilize a walking patient.
8 The chart contained some Spanish terms. Translated versions of
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that (1) the chart showed Preferred paid its equipment coordinators
based on the equipment they sold; (2) these payments were
kickbacks; and (3) kickbacks were prohibited by Medicare law.
Vega argues that the Government needed to qualify Stone
and Ayala as expert witnesses pursuant to Federal Rule of Evidence
702 in order for them to testify about whether Preferred paid its
equipment coordinators commissions and whether such commissions
were prohibited by 42 U.S.C. § 1320a-7b(b)(1)(B).9 Federal Rule
of Evidence 701 limits opinion testimony by lay witnesses to
opinions that are "not based on scientific, technical, or other
specialized knowledge within the scope of Rule 702." Fed. R.
Evid. 701(c). Vega argues Stone and Ayala's testimony was based
on technical or specialized knowledge. The Government counters
it was not.
In support of its view, the Government notes we have
allowed police officers to offer opinions based on the
"particularized knowledge [the officers had] by virtue of [their]
position[s]" without being qualified as experts. United States
these charts are part of the trial record.
9 The Government argues that Vega failed to preserve both of her
claims on appeal because she failed to contemporaneously object
during Stone or Ayala's testimony. We find the record ambiguous.
Because we find any error harmless even under the "manifest abuse
of discretion" standard, we do not address this point. United
States v. Valdivia, 680 F.3d 33, 50 (1st Cir. 2012).
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v. Ayala-Pizarro, 407 F.3d 25, 28 (1st Cir. 2005) (quoting Fed. R.
Evid. 701, advisory committee's note on 2000 amendment). The
Government argues that Stone and Ayala gained familiarity with the
anti-kickback statute through their jobs and thus their testimony
fit within the ambit of "particularized knowledge" gained "by
virtue of [their] positions."
The Government reads too much into our precedent. We
acknowledge that we have previously stated that Rule 701 "is meant
to admit testimony based on the lay expertise a witness personally
acquires through experience, often on the job." United States v.
Maher, 454 F.3d 13, 24 (1st Cir. 2006). We have not stated,
however, that all job-based knowledge is nontechnical or
nonspecialized. Rather, we have stated that lay experiential
expertise refers to those processes that are "well founded on
personal knowledge and susceptible to cross-examination." Ayala-
Pizarro, 407 F.3d at 28 (quoting United States v. Vega-Figueroa,
234 F.3d 744, 755 (1st Cir. 2000)). Such lay expertise is "the
product of reasoning processes familiar to the average person in
everyday life." United States v. García, 413 F.3d 201, 215 (2d
Cir. 2005). For example, a police officer noticing patterns of
behavior across criminal operations uses straightforward logic to
conclude a defendant's behavior fits within that pattern and thus,
does not need to be qualified as an expert. See United States v.
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Santiago, 560 F.3d 62, 66 (1st Cir. 2009) (holding that officer
could testify about meaning of code words used during drug
transactions based on hearing same language in other drug
investigation as lay witness); Ayala-Pizarro, 407 F.3d at 28-29
(finding officer could testify as lay witness that defendant was
at "drug point" based on observation that location was heavily
guarded because no specialized expertise was required for officer
to reach the conclusion that "places which sell drugs are often
protected by people with weapons").
The testimony in this case helps illustrate this
distinction between experiential knowledge that relies on
reasoning processes familiar to the average person and more
specialized expertise. On the one hand, Ayala's testimony about
his interpretation of the chart he found at Preferred could be
properly admitted as lay testimony. A jury could follow the
reasoning process Ayala used and understand why he interpreted a
chart listing medical equipment and containing a column reading
"Rep. payment" as evidence that Preferred's equipment coordinators
were paid based on the equipment they sold. Such testimony relying
upon logic and pattern recognition falls within Rule 701's
parameters for lay testimony.
In contrast, we find that Stone's testimony and Ayala's
final conclusion that Preferred's commissions violated Medicare
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law fell outside the boundaries of lay expertise. Their opinions
were not based on the product of applying familiar reasoning
processes to their job experience -- rather, they could form their
opinions only by understanding technical Medicare laws and
regulations. Contrary to the Government's arguments, the fact
that Stone and Ayala had knowledge of Medicare law through their
occupations does not make it "personal knowledge" qualifying as
lay expertise under Rule 701. As stated above, our use of the
term "personal knowledge" refers, generally, to the product of a
witness's process of observing patterns and drawing logical
conclusions. An understanding of what Medicare law allows and
forbids cannot be developed through this process. When condemning
commission payments as illegal kickbacks, Stone and Ayala were not
relaying their personal observations for the jury to assess;
rather, they were lending the jury their knowledge of Medicare law
to provide definitive commentary on the matter. Other circuits
have reached similar conclusions concerning witnesses' testimony
about best practices and legal regulations in fraud cases. United
States v. White, 492 F.3d 380, 399-405 (6th Cir. 2007) (finding
Medicare auditors could not testify about meaning of certain
Medicare terms when testifying as lay witnesses); United States v.
Riddle, 103 F.3d 423, 428-29 (5th Cir. 1997) (finding bank auditor
needed to be qualified as expert in order to testify that
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defendant's conduct fell outside of sound banking practices
because witness "functioned not as a witness relaying his own
observations so much as a knowledgeable bank examiner who could
provide the jury with an overview of banking regulations and
practices and who could authoritatively condemn [the defendant's]
actions"). We thus conclude it was error to admit Stone's and
Ayala's testimony that the payment of commissions to equipment
coordinators violated Medicare law without qualifying them as
expert witnesses.
Nonetheless, we find any error in the admission of this
testimony harmless, meaning that we find it is "highly probable
that the error did not contribute to the verdict." United States
v. Amador-Huggins, 799 F.3d 124, 129 (1st Cir. 2015) (quoting
United States v. Varoudakis, 233 F.3d 113, 125-26 (1st Cir. 2000)).
Vega's theory of defense at trial was that she was not aware of
the fraud or commission payments occurring at Preferred. Vega's
closing argument focused on developing the theory that Acevedo,
who had participated in a separate Medicare fraud scheme prior to
Preferred, was the ringleader of the entire scheme. Vega did not
contest at trial that Preferred paid commissions to its equipment
coordinators or that such actions were illegal. Instead, the crux
of her argument was that Acevedo made the payments herself or had
Pérez (whom Acevedo knew prior to working at Preferred) prepare
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checks for Vega, who then signed the checks without knowing their
purpose. Given Vega's trial strategy, we think it is highly
probable that Stone's and Ayala's statements that commission
payments violated § 1320a-7b(b)(1)(B) did not contribute to the
verdict. The issue that Vega posed to the jury was whether it
believed Vega was knowingly involved with Preferred's commissions,
not whether Preferred's scheme violated the law. Finding no
reversible error, we move to another of Vega's claims.
IV. Jury Instructions
Vega next argues that the district court's jury
instructions regarding charges for aiding and abetting the receipt
of kickbacks were incomplete. We reject these claims as well.
A. The Anti-Kickback Instruction
The Government charged Vega with violating the anti-
kickback statute pursuant to 42 U.S.C. § 1320a-7b(b)(1)(B). That
statute makes it a crime to
knowingly and willfully solicit[] or receive[] any
remuneration (including any kickback, bribe, or
rebate) directly or indirectly, overtly or covertly,
in cash or in kind . . . in return for purchasing,
leasing, ordering, or arranging for or recommending
purchasing, leasing, or ordering any good, facility,
service, or item 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). The district court instructed the
jury that § 1320a-7b(b)(1)(B) "makes it a crime to . . . ask for
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or receive or pay or offer to pay any remuneration in connection
with referring patients or arranging for which [sic] payments may
be made under the federal healthcare program." It went on to
state that in order to convict Vega
[T]he government must prove each of the following
beyond a reasonable doubt:
One, referring an individual to a person for the
furnishing or arranging for the furnishing of an item
or service that could be paid for, in whole or in part,
by a federal healthcare program. Or, two, purchasing,
leasing, ordering, or arranging for or recommending
purchasing, leasing, or ordering any good, facility,
service, or item that could be paid for, in whole or
in part, by a federal healthcare program. And, third,
that Ms. Vega did [so] knowingly and willfully.
Vega argues for the first time on appeal that these
instructions were incomplete because they did not state that the
jury needed to find that Vega aided or abetted in the
"solicit[ation] or recei[pt] [of] any remuneration" and did not
define "remuneration." When a defendant makes no objection to a
jury instruction at trial, this court reviews the instruction for
plain error. United States v. Meadows, 571 F.3d 131, 145 (1st
Cir. 2009). In order to establish plain error, "a criminal
defendant must show (1) that an error occurred (2) which was clear
or obvious and which not only (3) affected the defendant's
substantial rights, but also (4) seriously impaired the fairness,
integrity, or public reputation of judicial proceedings." United
States v. González-Vélez, 466 F.3d 27, 34-35 (1st Cir. 2006)
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(quoting United States v. Duarte, 246 F.3d 56, 60 (1st Cir. 2001)).
"[T]he plain error hurdle . . . nowhere looms larger than in the
context of alleged instructional errors." United States v.
Paniagua-Ramos, 251 F.3d 242, 246 (1st Cir. 2001).
The district court's instructions in this case do not
clear this hurdle. While the district court's instruction may not
have been "letter perfect," we think that, "read[] against the
backdrop of the charge as a whole," the district court's
instruction was sufficient. Id. at 246-47. The district court
mentioned that Vega needed to aid or abet in the receipt of
remunerations before describing the elements the Government needed
to prove. We think that this was sufficient for the jury to
understand that the charge also required evidence of a remuneration
and, thus, that absent a contemporaneous objection, it did not
constitute plain error.
We also think the backdrop of the charge as a whole did
not necessitate a definition of the term "remuneration." The
Government's charges were not based on a novel conception of the
word "remuneration." They were in reference to Preferred paying
Garrastegui and its equipment coordinators according to the amount
of DME they prescribed and ordered. The term "remuneration"
referred to these payments. Given this straightforward use of the
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term, we do not think it was plain error for the district court to
leave it undefined.
B. Safe Harbor Instruction
Vega has one preserved jury instruction claim. While
discussing the jury instructions with the district court, Vega
requested that the court instruct the jury about the "safe harbor"
provisions promulgated by the Department of Health and Human
Services. The district court denied this request. When "a
criminal defendant seasonably requests an instruction on a
particular theory of the case and the trial court flatly refuses
to submit that theory to the jury, our review is plenary." United
States v. Ramos-Paulino, 488 F.3d 459, 463 (1st Cir. 2007).
The Department of Health and Human Services has
promulgated regulations stating that certain payments are not
"remunerations" in violation of § 1320a-7b(b)(1)(B). Vega claims
she should have been allowed to argue to the jury that Preferred's
payments to its equipment coordinators fit within the safe harbor
described in 42 C.F.R. § 1001.952(d). This regulation allows
principals, such as DME suppliers, to pay agents, such as equipment
coordinators, for their services if several provisions are met,
including: that the payment agreement is in writing, the
contractual relationship is for more than one year, and the agent's
payment is at a set salary. Id. § 1001.952(d)(2), (4), (5).
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"[T]o warrant a jury instruction on a specific theory of
defense, the evidence adduced at trial, taken in the light most
flattering to the accused, must plausibly support the theory."
Ramos-Paulino, 488 F.3d at 461 (emphasis in original). "The
burden is on the defendant, as the proponent of the theory, to
identify evidence adduced during the trial that suffices to satisfy
this standard." Id. at 462.
Vega has not pointed us to any evidence showing that the
safe harbor provisions could have plausibly applied to her case.
Simply put, Vega did not even argue that Preferred met the basic
requirement that its payment agreements with its equipment
coordinators were in writing -- let alone that these agreements
were for a period longer than one year and had a set salary. On
this final point, Vega did not argue to the jury that Preferred
paid its equipment coordinators salaries. As discussed in the
previous section, Vega's theory of defense was that she had no
knowledge of the commissions. Given this trial record, we find
no error with the district court's denial of Vega's request for a
safe harbor instruction.
V. Identity Theft
Vega also raises two sufficiency challenges on appeal.
The first challenge regards her convictions for identity theft for
using the personal information of Medicare beneficiaries Figueroa,
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Quiles, and Toro to order equipment and submit claims to Medicare
without their permission. A person commits aggravated identity
theft when that person "knowingly transfers, possesses, or uses,
without lawful authority, a means of identification of another
person" "during and in relation to any felony violation enumerated
in subsection (c)," which includes any fraud crime enumerated in
chapter 18 of the U.S. Code. 18 U.S.C. § 1028A(a)(1),(c)(4).
Vega contests this final fraud element. She notes that,
as charged in the indictment, she used the beneficiaries'
identities some time prior to December 2010.10 The timing, Vega
argues, is significant because in that month she (according to
Garrastegui's testimony) asked Garrastegui to visit Preferred's
office and fill out medical documentation that was missing from
Preferred's medical claim files. 11 Vega acknowledges that a
reasonable jury could conclude she knew of Preferred's fraud based
on this testimony, but argues this was the only evidence proffered
sufficient to prove her guilt. If true, tying these threads
10 The specific dates are: May 7, 2010 (Quiles); August 17, 2010
(Toro); and September 21, 2010 (Figueroa).
11 Garrastegui did not testify that he came to Preferred in
December 2010 -- he could remember only that he visited in "the
latter part of 2010." The December 2010 date appears to come from
the testimony of an auditor Vega hired. This auditor testified
that when he visited Preferred in early December 2010, many of the
claims he saw lacked required medical documentation.
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together would mean that Vega did not know Preferred's claims were
fraudulent prior to December 2010 and thus, could not have used
the beneficiaries' personal information in connection with fraud
as required by the identity theft statute.
We, however, reject Vega's premise that Garrastegui's
visit to Preferred was the only evidence proving her knowledge of
Preferred's fraud. When reviewing a sufficiency of the evidence
claim, we must "take the evidence and draw all reasonable
inferences in the light most favorable to the prosecution."
United States v. Rosado-Pérez, 605 F.3d 48, 52 (1st Cir. 2010).
"If a reasonable jury could find the defendants guilty beyond a
reasonable doubt of all elements of the charged offense, we must
affirm the conviction." Id.12
A reasonable jury could conclude that Vega knew of the
fraud occurring at Preferred prior to Garrastegui's visit. The
12 Moreover, Vega did not argue that the Government presented
insufficient evidence for the charges prior to December before the
district court. Vega's Rule 29 motions for acquittal argued only
that the Government failed to prove her awareness of Preferred's
fraud at any point during the conspiracy. As "a party is not at
liberty to articulate specific arguments for the first time on
appeal simply because the general issue was before the district
court," we review for plain error. Acosta-Colón, 741 F.3d at 210
(quoting United States v. Slade, 980 F.2d 27, 31 (1st Cir. 1992));
see also United States v. Christi, 682 F.3d 138, 140 (1st Cir.
2012) (applying plain error to sufficiency theory not articulated
in Rule 29 motion). Nonetheless, we would reject Vega's claim
even if it was preserved and our discussion treats it as such.
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Government presented several strands of circumstantial evidence
through which a reasonable jury could infer knowledge, and a "jury
[is] entitled to rely on plausible inferences." United States v.
Matthews, 498 F.3d 25, 31 (1st Cir. 2007).
First, a reasonable jury could infer that Vega knew the
claims Preferred submitted on behalf of Figueroa, Quiles, and Toro
were fraudulent at the time of submission or soon thereafter.
Each of the beneficiaries (or a spouse or a relative) testified
that he or she told Preferred the beneficiaries did not want the
DME, one of whom stated she spoke with Vega directly.13 Moreover,
multiple witnesses testified that Vega had a large degree of
control over Preferred's operations. Vega told an FBI agent
investigating her that nothing at Preferred was done without her
consent. Additionally, as described by Acevedo, the DME orders
and Medicare claims did not go exclusively through the equipment
13 Quiles testified that he called Preferred asking someone to
pick up the DME, but his request was ignored. Yet Preferred billed
Medicare for equipment it claimed it rented to Quiles from at least
March 2010 to March 2011. Toro's daughter testified that two
people from Preferred came to their house after her father called
their office saying he did not want the DME delivered. Preferred,
however, did not pick up the equipment and billed Medicare in
Toro's name from March 2010 through March 2011 and claimed he was
seen by Garrastegui. Figueroa's wife, Pascasia, testified that
she told someone who identified herself as Vega over the phone
that Figueroa did not need the equipment "[b]ecause the physician
who came over [and prescribed it] [was] not [her] husband's
attending physician." Preferred picked up the equipment but
continued billing Medicare from August 2010 through October 2010.
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coordinators. Rather, once an equipment coordinator obtained a
patient's information, either Vega or her secretary would verify
that the patient was a Medicare beneficiary. Given Vega's role
at Preferred, a jury could rationally find that Vega must have
known that the beneficiaries complained to Preferred they did not
want DME delivered to their houses and therefore any claims filed
after their complaints were fraudulent.
Second, the testimony of Preferred's equipment
coordinators suggested that Vega not only knew of the fraud, but
actively played a role in directing it. Acevedo testified that
at Vega's instruction, Preferred did not fulfill DME orders that
came from individuals who were not Medicare beneficiaries or that
did not contain a motorized wheelchair (a high-priced item). A
reasonable jury could infer that Vega was interested in fulfilling
orders only from Medicare beneficiaries because Medicare's honor
system made it easy to defraud. Similarly, Vega's insistence on
orders containing a motorized wheelchair creates a strong
inference that she did not care about whether the DME orders
fulfilled served a legitimate medical purpose. Vega's
indifference towards the medical legitimacy of Preferred's orders
is further bolstered by Acevedo's testifying that she told Vega
when she started working at Preferred (i.e., March 2010) that
Garrastegui would prescribe DME for patients he did not see.
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Sárraga also testified that he knew Vega was aware of this fact.
The fact that Vega allowed equipment coordinators to submit claims
with Garrastegui as the prescribing doctor also supports an
inference that she condoned Preferred's fraud.
We also note that a reasonable jury could view
Preferred's commission payments to the equipment coordinators
(which Vega set and paid), taken with this record, as further
evidence that Vega had a role in directing the fraud. Standing
alone, this would not be sufficient to prove Vega knew of the
fraud, but it is further evidence that Vega was motivated to submit
as many claims as possible to Medicare, regardless of their
legitimacy.
All of this evidence combined convinces us that a
reasonable jury could conclude Vega had knowledge of Preferred's
fraud beyond a reasonable doubt. We therefore reject Vega's
sufficiency challenge.
VI. Money Laundering
In addition, Vega contests the sufficiency of the
Government's evidence proving her involvement with money
laundering. In order to commit money laundering, a defendant must
"engage in a monetary transaction in criminally derived property
of a value greater than $10,000" that is in or affects interstate
or foreign commerce. 18 U.S.C. § 1957(a), (f)(1). The Government
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charged Vega with money laundering based on her using money in
Preferred's bank account to make two transactions: to pay off an
$16,302.65 automobile loan in late December 2010 and to purchase
an official check in the amount of $34,121.16 in January 2011.
Vega contests the sufficiency of the Government's evidence
regarding several elements of this crime.
First, Vega argues that the Government did not present
sufficient evidence proving that she knew the property she
transacted in -- i.e., the money she used to pay her loan and
purchase a certified check -- was criminally derived. This
argument hinges on the point we rejected in considering her
identity theft claim -- that the Government did not provide
sufficient evidence to prove she knew of the theft at Preferred
prior to December 2010. We also note that Vega's money laundering
charges correspond to transactions that occurred after the date
she concedes the Government proved she knew of the fraud (late
December 2010 and mid-January 2011).
Second, Vega argues that the Government failed to prove
that the value of each transaction was greater than $10,000. This
argument is also contingent on Vega's view that the Government did
not prove she knew of Preferred's fraud until December 2010.
According to Vega, Medicare paid only $9,633.98 to Preferred
following December 2010 and we should assume Vega used only "clean"
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funds to pay her loans. Our finding that the Government presented
sufficient evidence that Vega knew of the fraud prior to December
2010 compels us to reject her argument.
Finally, Vega argues that the Government failed to prove
that her transactions affected interstate commerce. Vega points
to the fact that Preferred's bank account was with Banco Popular
and both of her transactions went to other Banco Popular accounts.
She argues that transferring money within the same bank cannot
affect interstate commerce. This claim was considered sua sponte
by the district court and then rejected based on the Government's
arguments that a witness who worked for CIGNA, the processor that
paid out Medicare claims, stated CIGNA was located in Tennessee
and was the subsidiary of a South Carolina company. Vega now
argues this ruling was erroneous because there was no testimony
that CIGNA was based in Tennessee and the location of CIGNA's
parent company was irrelevant.
We reject Vega's argument. Section 1957 requires only
a de minimus effect on interstate commerce. United States v.
Benjamin, 252 F.3d 1, 10 (1st Cir. 2001). We have previously
stated that a bank deposit affects interstate commerce if "the
source of that deposit actually affected interstate commerce to
any degree." Id. at 11. The crux of the Government's cases
against Vega was that she defrauded a federal health care program.
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We think it is uncontroversial to conclude the source of Vega's
funds affected interstate commerce, thereby satisfying the
interstate commerce element. See United States v. Girod, 646 F.3d
304, 315 (5th Cir. 2011) (rejecting defendant's argument
government failed to prove interstate commerce affect for
healthcare fraud charges because "Medicaid . . . is a federally
funded program that indisputably affects interstate commerce").
We thus find the Government presented sufficient evidence to
convict Vega of money laundering.
VII. Conclusion
Finding that the Government presented sufficient
evidence and any procedural defects were harmless, we affirm.
Affirmed.
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