United States v. Daniel Puffenberger

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FILED
FOR THE ELEVENTH CIRCUIT U.S. COURT OF APPEALS
________________________ ELEVENTH CIRCUIT
DECEMBER 23, 2009
No. 08-16724 THOMAS K. KAHN
Non-Argument Calendar CLERK
________________________
D. C. Docket No. 07-00063-CR-3-RWS-1
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
DANIEL PUFFENBERGER,
ARTHUR HARGRAVES,
Defendants-Appellants.
________________________
Appeals from the United States District Court
for the Northern District of Georgia
_________________________
(December 23, 2009)
Before TJOFLAT, BARKETT and WILSON, Circuit Judges.
PER CURIAM:
Daniel Puffenberger appeals his convictions, and Arthur Hargraves appeals
his convictions and sentence, following a trial in which a jury convicted each on
five counts of healthcare fraud, in violation of 18 U.S.C. § 1347. The alleged fraud
involved Puffenberger and Hargraves deceptively billing a procedure known as
“VAX-D,” which involved technicians, not medical doctors, strapping patients
onto a table that would separate in the middle and return for approximately 20
minutes. Puffenberger and Hargraves billed this non-invasive mechanical
procedure under an open surgical procedure code because insurance companies
reimbursed for the surgical treatment code but not for “VAX-D” therapy. We
address each Appellant’s claims in turn.
I.
On appeal, Puffenberger argues that the district court abused its discretion
by failing to grant a severance. Puffenberger reasons that evidence admitted about
Hargraves’s prior acts would not have been admissible against him in a separate
trial and was used here only to show his guilt by association.
We review the denial of a motion for severance for abuse of discretion.
United States v. Browne, 505 F.3d 1229, 1268 (11th Cir. 2007). “It is well settled
that defendants who are indicted together are usually tried together.” Id. “In
considering a motion to sever, the district court must determine whether the
prejudice inherent in a joint trial outweighs the public’s interest in judicial
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economy.” United States v. Francis, 131 F.3d 1452, 1459 (11th Cir. 1997). “[T]o
show such an abuse, [the appellant] must discharge the heavy burden of
demonstrating compelling prejudice from the joinder.” Browne, 505 F.3d at
1268 (internal quotations omitted). “A defendant must first demonstrate that the
joint trial resulted in prejudice to him; and second, must show that severance is the
proper remedy for that prejudice.” Id. “Rule 14 does not require severance even if
prejudice is shown; rather, it leaves the tailoring of the relief to be granted, if any,
to the district court’s sound discretion.” Zafiro v. United States, 506 U.S. 534,
538-39, 113 S. Ct. 933, 938, 122 L. Ed. 2d 317 (1993).
We have considered the record and the briefs of the parties and find no
reversible error with reference to this claim. Because (1) Puffenberger failed to
show that his joint trial resulted in any prejudice to him, (2) the government
presented ample evidence of his guilt, and (3) the district court minimized any
possible prejudice by instructing the jury to consider the evidence against each
defendant separately, we affirm the district court’s denial of Puffenberger’s motion
for severance.
II.
Hargraves first argues that insufficient evidence establishes that he acted
with the necessary intent to defraud Blue Cross Blue Shield of Georgia by using an
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improper code for the procedures performed in his clinic. Specifically, Hargraves
argues that the government failed to prove that he “knowingly and willfully” billed
the wrong codes.
We review the sufficiency of the evidence presented at trial de novo and
considers the evidence “in the light most favorable to the government, with all
inferences and credibility choices drawn in the government’s favor.” United States
v. LeCroy, 441 F.3d 914, 924 (11th Cir. 2006). “It is not necessary that the
evidence exclude every reasonable hypothesis of innocence or be wholly
inconsistent with every conclusion except that of guilty, provided a reasonable trier
of fact could find that the evidence establishes guilt beyond a reasonable doubt.”
United States v. Young, 906 F.2d 615, 618 (11th Cir. 1990).
To support a conviction for substantive health care fraud under 18 U.S.C.
§ 1347, the government must prove that the defendant (1) knowingly and willfully
executed, or attempted to execute, a scheme or artifice to (2) defraud a health care
program or to obtain by false or fraudulent pretenses any money or property under
the custody or control of a health care benefit program, (3) in connection with the
delivery of or payment for health care benefits, items, or services. 18 U.S.C.
§ 1347. Intent may be established through circumstantial evidence, so long as
there is enough evidence from which a jury could reasonably infer that the
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defendant acted with the specific intent to defraud. See United States v. Lopez-
Ramirez, 68 F.3d 438, 440 (11th Cir. 1995).
After reviewing the record and drawing all inferences in the light most
favorable to the government, the evidence against Hargraves – even that which was
circumstantial – was sufficient to support his convictions. The government
presented ample evidence from former employees, as well as Hargraves’s former
partner, Howard Berkowitz, that described both (1) how Hargraves deliberately
used the wrong billing code and (2) how Hargraves sought to conceal this fact
from Blue Cross Blue Shield. A reasonable jury, which had the opportunity to
assess witness credibility and consider the evidence in context, could have found
that this evidence proved beyond a reasonable doubt that Hargraves knew of this
fraudulent scheme and intentionally furthered it. See Lopez-Ramirez, 68 F.3d at
440. Sufficient evidence supports Hargraves’s conviction.
III.
Hargraves also argues that the district court abused its discretion by
imposing a sentence greater than necessary to achieve the § 3553(a) goals.
Specifically, Hargraves contends that his sentence is substantively unreasonable
because the district court relied too heavily on general deterrence.
An appellate court reviews a sentence for unreasonableness under a
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“deferential abuse-of-discretion standard.” Gall v. United States, 552 U.S. ___,128
S. Ct. 586, 591, 169 L.Ed.2d. 445 (2007). A sentence is substantively unreasonable
“if it does not achieve the purposes of sentencing stated in § 3553(a).” United
States v. Pugh, 515 F.3d 1179, 1191 (11th Cir. 2008). The burden of establishing
that the sentence is unreasonable in light of the record and the § 3553(a) factors
lies with the party challenging the sentence. United States v. Talley, 431 F.3d 784,
788 (11th Cir. 2005).
Pursuant to § 3553(a), the sentencing court shall impose a sentence
“sufficient, but not greater than necessary, to comply with the purposes set forth in
paragraph (2) of this subsection,” namely to reflect the seriousness of the offense,
promote respect for the law, provide just punishment for the offense, deter criminal
conduct, protect the public from future crimes of the defendant, and provide the
defendant with needed educational or vocational training or medical care. See 18
U.S.C. § 3553(a)(2). The sentencing court must also consider the following factors
in determining a particular sentence: the nature and circumstances of the offense
and the history and characteristics of the defendant, the kinds of sentences
available, the sentencing guidelines range, the pertinent policy statements of the
Sentencing Commission, the need to avoid unwanted sentencing disparities, and
the need to provide restitution to victims. See 18 U.S.C. § 3553(a)(1), (3)-(7).
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“The weight to be accorded any given § 3553(a) factor is a matter committed to the
sound discretion of the district court, and we will not substitute our judgment in
weighing the relevant factors.” United States v. Amedeo, 487 F.3d 823, 832 (11th
Cir. 2007) (quotations and alterations omitted). In terms of the sentencing range,
we have held that “when the district court imposes a sentence within the advisory
Guidelines range, we ordinarily will expect that choice to be a reasonable one.”
Talley, 431 F.3d at 788.
We find no reversible error in the low-end Guideline sentence imposed.
Procedurally, the district court properly considered the § 3553(a) factors, the
parties’ arguments, and the record. We find no reversible error in the consideration
of the difficulties of law enforcement against healthcare fraud which requires
honest reporting from medical providers. The district court did not act outside of
its discretion in considering, although not exclusively, general deterrence. See
Amedeo, 487 F.3d at 832.
AFFIRMED.
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