United States v. W. Wayne Perry, Jr.

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 15-4032
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
W. WAYNE PERRY, JR.,
Defendant - Appellant.
No. 15-4050
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
ANGELA PERRY,
Defendant - Appellant.
Appeals from the United States District Court for the Eastern
District of Virginia, at Norfolk. Mark S. Davis, District Judge.
(2:13-cr-00156-MSD-DEM-1; 2:13-cr-00156-MSD-DEM-2)
Argued: March 24, 2016 Decided: August 9, 2016
Before AGEE and WYNN, Circuit Judges, and Thomas D. SCHROEDER,
United States District Judge for the Middle District of North
Carolina, sitting by designation.
Affirmed by unpublished per curiam opinion.
ARGUED: Joseph Ray Pope, WILLIAMS MULLEN, Richmond, Virginia;
Andrew Michael Sacks, SACKS & SACKS, Norfolk, Virginia, for
Appellants. Alan Mark Salsbury, OFFICE OF THE UNITED STATES
ATTORNEY, Norfolk, Virginia, for Appellee. ON BRIEF: John S.
Davis, WILLIAMS MULLEN, Richmond, Virginia, for Appellant W. Wayne
Perry, Jr. Dana J. Boente, United States Attorney, Alexandria,
Virginia, Melissa E. O’Boyle, Assistant United States Attorney,
OFFICE OF THE UNITED STATES ATTORNEY, Norfolk, Virginia, for
Appellee.
Unpublished opinions are not binding precedent in this circuit.
2
PER CURIAM:
W. Wayne Perry, Jr., and his wife, Angela Perry, were
convicted of conspiracy to commit healthcare fraud in violation 18
U.S.C. § 1349 (Count 1), healthcare fraud in violation of 18 U.S.C.
§ 1347 (Counts 2-5), making false statements in connection with a
health care benefit program in violation of 18 U.S.C. § 1035(Counts 6-13), alteration of records in violation of 18 U.S.C.
§ 1519 (Count 14), and aggravated identity theft in violation of
18 U.S.C. § 1028A(a)(1) (Counts 15-18). These charges arose from
a scheme to overbill Virginia’s Medicaid program through Mr.
Perry’s home healthcare company, Community Personal Care, Inc.
(“CPC”). On appeal, the Perrys raise various challenges to the
sufficiency of the evidence presented against them, the
government’s use of certain Medicaid regulations related to
“respite care” services, and the district court’s instructions to
the jury on the meaning of the term “willfully.” After careful
review, we reject each challenge and affirm the convictions.
I.
The principal evidence at trial, viewed in the light most
favorable to the government, as it must be at this stage, see
United States v. Perkins, 470 F.3d 150, 160 (4th Cir. 2006), is as
follows:
The Virginia Department of Medical Assistance Services
(“DMAS”) administers Medicaid programs for low income individuals
3
in Virginia. One such program, the Virginia Medical Assistance
Program (“VMAP”), authorizes certain companies to provide in-home
healthcare services. VMAP reimburses these companies for
providing basic assistance to patients in their own homes, with
the goal of avoiding unnecessary expenses and discomfort
associated with institutionalized care.
VMAP authorizes two types of in-home care, known as “personal
care” and “respite care” services. Personal care services assist
the patient with the activities of daily living, such as bathing
and dressing. Registered nurses prescribe an approved plan of
care that details the activities with which the patient needs
assistance and establishes the maximum number of hours per week
that providers may bill for providing these services. Invoices to
DMAS, however, must be based on the actual amount of time that
aides spend providing these services, rather than the maximum
number of hours authorized by the plan of care. In addition to
personal care services, DMAS also authorizes respite care services
for patients with an unpaid primary caregiver, often a family
member of the patient. Respite care refers to services provided
on an episodic or periodic basis to fill in for the designated
primary caregiver when he or she is sick, absent, or otherwise
needs a break from the responsibilities of caring for the patient.
4
See 12 Va. Admin Code. § 30-120-766(A)(2) (2008). 1 DMAS authorized
up to 720 respite care hours annually for each patient’s primary
caregiver prior to July 1, 2011, and 480 hours annually thereafter.
Mr. Perry founded CPC in 1998 and served as its president and
CEO, while Mrs. Perry served as his executive assistant and oversaw
various staffers. Over a period of several years, CPC employees
engaged in a widespread practice known as “billing by the plan of
care,” that is, billing DMAS for the maximum number of personal
care hours authorized by a patient’s plan of care, rather than by
the number of hours documented on the health aides’ timesheets, as
required by DMAS regulations. See, e.g., J.A. 260, 328–29. At
least one CPC employee raised concerns about this practice with
Mr. Perry after taking a Medicaid billing and coding course from
a nearby college. Mr. Perry allowed the employee to bill from the
aide records for one week, but instructed her to go back to billing
by the plan of care after learning that billing by the aide records
resulted in significantly lower billing. When the employee spoke
with Mrs. Perry about the practice, Mrs. Perry responded, “That is
what Wayne wants us to do, so that’s what we do.” J.A. 194–95.
CPC employees also routinely billed for respite care services that
no CPC employee actually provided.
1 The conspiracy in this case existed from 2009 to 2013. For
purposes of these definitions, the pertinent Virginia regulations
did not change materially between 2008 and 2013.
5
CPC employees also engaged in an extensive effort to conceal
the fraudulent billing scheme. Beginning in 2010, Mr. Perry
engaged Allison Hunter-Evans, a former DMAS employee, to identify
problems with CPC’s records and documentation. When Hunter-Evans
raised concerns with Mrs. Perry about billing by the plan of care,
Mrs. Perry shook her head and responded, “It will be the death of
him,” referring to her husband. J.A. 1193-94. Yet no corrective
action was taken. Instead, CPC employees doctored records in
response to the deficiencies identified by Hunter-Evans. Mr. Perry
also paid Hunter-Evans to have lunch with a former colleague at
DMAS in order to glean non-public information about an upcoming
audit of CPC. When Hunter-Evans reported the specific time period
that was likely to be the subject of the audit, Mr. Perry responded
via email, “Now that’s what i am talki= ng about!!!! I WILL START
SAVING MY $$$$$.I will be ready!” J.A. 3542; see also J.A. 1171.
CPC employees spent the weekend before the audit forging
signatures, adding hours to timesheets, and otherwise doctoring
records. Although Mr. and Mrs. Perry were both present in the
office that weekend, Mrs. Perry primarily directed the effort to
conceal the fraud, even assigning a specific employee to forge
signatures because she was the “artistic one.” J.A. 273–76.
In February 2014, a grand jury indicted the Perrys on eighteen
counts of healthcare fraud, conspiracy to commit healthcare fraud,
making false statements relating to health care, alteration of
6
records, and aggravated identity theft. The conspiracy was alleged
to have existed from January 2009 through January 2013, with the
substantive counts occurring at various times throughout that
period. Hunter-Evans, who was also indicted in this case, pleaded
guilty to alteration of records (Count 14) and testified against
the Perrys at trial. More than a dozen former CPC employees also
testified against the Perrys, several under grants of immunity
from the government. The jury convicted the Perrys on all counts.
This appeal followed.
II.
The Perrys first challenge the sufficiency of the evidence
against them on Counts 2-13 and 15-18. Counts 2-5 charged the
Perrys with health care fraud in violation of 18 U.S.C. § 1347.
In order to establish these counts, the government was required to
prove that the Perrys knowingly and willfully executed a scheme to
defraud DMAS. See United States v. McLean, 715 F.3d 129, 137–38
(4th Cir. 2013). Counts 6-13 charged the Perrys with making false
statements relating to health care matters in violation of 18
U.S.C. § 1035. In order to establish these counts, the government
was required to prove that (1) the Perrys made a materially false
statement; (2) in connection with the delivery of or payment for
health care benefits; (3) in a matter involving a health care
benefit program, as that term is defined in 18 U.S.C. § 24(b); and
(4) the Perrys acted knowingly and willfully. See United States
7
v. Natale, 719 F.3d 719, 742 (7th Cir. 2013). Finally, Counts 15-
18 charged the Perrys with aggravated identity theft in violation
of 18 U.S.C. § 1028A(a)(1). In order to establish these counts,
the government was required to prove that the Perrys (1) knowingly
transferred, possessed, or used; (2) without lawful authority; (3)
a means of identification of another person; (4) during and in
relation to a predicate felony offense. United States v.
Abdelshafi, 592 F.3d 602, 607 (4th Cir. 2010). Health care fraud
qualifies as a predicate felony offense for the purposes of
§ 1028A. Id.
“A jury’s verdict must be upheld on appeal if there is
substantial evidence in the record to support it.” United States
v. Foster, 507 F.3d 233, 244 (4th Cir. 2007). The court must view
the evidence in the light most favorable to the government and
assume that the jury resolved all contradicting evidence in the
government’s favor. Id. at 245. “[T]he uncorroborated testimony
of one witness or of an accomplice may be sufficient to sustain a
conviction.” United States v. Wilson, 115 F.3d 1185, 1190 (4th
Cir. 1997). In addition, “the existence of a conspiratorial
agreement need not be proven by direct evidence, but may be
inferred from the facts and circumstances of the case.” United
States v. Laughman, 618 F.2d 1067, 1074 (4th Cir. 1980).
Ultimately, in reviewing for substantial evidence, “[t]he relevant
question is whether, after viewing the evidence in the light most
8
favorable to the prosecution, any rational trier of fact could
have found the essential elements of the crime beyond a reasonable
doubt.” Jackson v. Virginia, 443 U.S. 307, 319 (1979).
The Perrys do not dispute that, from at least 2009 through
2013, CPC employees submitted fraudulent invoices to DMAS, used
patient identification numbers without permission, and altered
timesheets and other records in an attempt to conceal their fraud
from auditors. At trial, they claimed that CPC employees conceived
and executed this scheme without their knowledge or participation.
On appeal, however, the Perrys do not argue that the evidence
against them was insufficient to support their convictions for
conspiracy to commit healthcare fraud and altering records. 2
Nevertheless, the Perrys both argue that insufficient evidence
exists to convict them of the substantive counts relating to
respite care fraud, and Mrs. Perry contends that the evidence was
insufficient to convict her of the substantive counts relating to
personal care fraud. 3 We disagree.
2 Although the Perrys have not expressly challenged the
sufficiency of the evidence supporting their convictions for
conspiracy to commit healthcare fraud (Count 1), we note that the
evidence discussed below makes plain that there is sufficient
record support for their conspiracy convictions.
3 The Perrys also challenge the sufficiency of the evidence
supporting their convictions for aggravated identity theft. The
identity theft counts in the indictment involved the use of
Medicaid identification numbers on fraudulent personal and respite
care invoices. The Perrys have not raised any sufficiency
9
Ample evidence was presented at trial to support the jury’s
conclusion that Mr. Perry participated in the respite care fraud
scheme. Former CPC employees testified that when CPC’s revenues
were down, Mr. Perry imposed quotas for respite care hours and
threatened to fire staffing coordinators who failed to meet these
quotas. Several employees testified that Mr. Perry would often
instruct them to “run the respite” or “burn up the respite,” see,
e.g., J.A. 266–67, 544, 2282, and that they understood these
instructions as directions to submit invoices for respite hours
that were not worked or to provide respite services that were not
requested by the patient or primary caregiver. There was extensive
evidence of multiple employees falsifying respite records to bill
DMAS for scores of respite hours that were never worked. And there
was evidence that Mr. Perry’s demands were sometimes communicated
late in a billing cycle or toward the end of a fiscal year such
that he would have known it was unlikely – if not impossible – for
arguments specific to the aggravated identity theft counts. As a
result, this Court will treat the sufficiency of the evidence
supporting the aggravated identity theft counts as rising and
falling with the personal and respite care fraud counts.
The Perrys also argue that the aggravated identity theft
statute, 18 U.S.C. § 1028A(a)(1), does not reach the type of
conduct charged in this case. This Court has already rejected
this argument. See Abdelshafi, 592 F.3d at 606–10. The Perrys
raise the issue solely to preserve it for further review because,
as they acknowledge, this panel cannot overrule a published
decision of a prior panel. Jones v. Angelone, 94 F.3d 900, 905
(4th Cir. 1996).
10
staffing coordinators to meet his quotas without billing for hours
that no CPC employee actually worked.
There was also evidence of a financial incentive for the
scheme. In 2010, for example, CPC billed approximately $90,000
per month for respite care services over the first six months of
the year, but approximately $150,000 per month over the last six
months of the year. Mr. Perry told employees that he used respite
“to pay the bills,” and even when he wasn’t demanding that
employees meet specific respite quotas, he authorized aides to
bill for unrealistic numbers of respite care hours – up to 250
hours per two-week cycle – in order to achieve this goal. J.A.
688–89. According to one employee involved in the scheme, Mr.
Perry “knew what was going on.” J.A. 735. That conclusion was
supported by evidence that CPC paid employees who engaged in the
fraudulent respite billing scheme with separate bonus checks that
required Mr. Perry’s approval, some of which more than doubled the
employees’ normal compensation checks. In one instance, an
employee was paid by separate bonus check in an amount that
exceeded twenty-four hours per day for a two-week period.
Mr. Perry conceded that he directed employees to “run the
respite” but points to testimony that no one ever heard him direct
the falsification of respite timesheets. He contended that his
urging of employees to encourage patients and caregivers to use
respite care was legal and that he was unaware of the fraud. To
11
be sure, some CPC employees testified that “some” respite burning
was “on [their] own” in order to benefit themselves personally.
E.g., J.A. 578, 584, 647. As the district court noted, however,
a large portion of this case came down to credibility. A rational
trier of fact could find the government’s witnesses to be credible,
particularly in light of the large financial benefit Mr. Perry
reaped as a result of the respite care fraud scheme which extended
for almost three years, as well as the substantial evidence showing
that Mr. Perry also orchestrated CPC’s personal care fraud scheme.
We reach the same conclusion as to Mrs. Perry, who was Mr.
Perry’s executive assistant and considered by employees to be a
“boss” like Mr. Perry. J.A. 538. There was evidence that she was
involved with and approved of the widespread and ongoing misconduct
at CPC. With regard to personal care specifically, at least one
witness testified that Mrs. Perry knew about CPC’s practice of
billing by the plan of care rather than by the actual hours worked
and that Mrs. Perry advised, “[T]hat is what Wayne wants to do, so
that’s what we do.” J.A. 194–95. Mrs. Perry also actively
directed employees to falsify aide records and was “in charge”
during the weekend meetings to prepare for the audit, when
employees were directed to fabricate aide record entries to match
the plan of care hours that had been billed to conceal CPC’s fraud.
J.A. 273-76.
12
With regard to respite care, Mrs. Perry conveyed Mr. Perry’s
quotas to the employees responsible for carrying out the fraud and
threatened to fire a personal care aide for failing to meet her
quota. When one employee expressed concern that the nurses might
discover the respite fraud scheme, Mrs. Perry said that she would
“handle the nurses.” J.A. 205. Finally, Mrs. Perry shared Mr.
Perry’s motive for participating in the scheme because she depended
on him to “provide” for her and her children. See J.A. 2470–71.
As with Mr. Perry, a rational trier of fact could find the evidence
discussed above to be credible.
Finally, the Perrys challenge the sufficiency of the evidence
supporting Count 9 of the indictment, which charged them with
violating 18 U.S.C. § 1035 for overbilling DMAS for personal care
services for a specific patient, E.J., during the week of January
3-9, 2011. In contrast with their other sufficiency arguments,
the Perrys do not claim that Count 9 involved a fraud committed by
CPC employees without their knowledge. Instead, they contend that
the government failed to prove that the invoice was fraudulent at
all – that is, that CPC employees did not work the hours billed to
DMAS in connection with Count 9.
The Perrys claim that their convictions on Count 9 were based
solely on the absence from E.J.’s file of a timesheet documenting
the number of hours worked by a CPC aide during the week in
question. In addition, they point to testimony from E.J.’s nurse
13
and daughter that E.J. was not self-sufficient and could not go an
entire week without care. In light of this circumstantial evidence
that E.J. could have received her normal, approved amount of care,
they argue, no reasonable jury could have convicted on this count
“merely from the circumstance of a missing [timesheet] form.”
Opening Br. at 34.
Contrary to the Perrys’ assertions, however, the government
presented more than just a missing timesheet to support Count 9.
The government offered the testimony of Mary McKay, the CPC home
health aide assigned to E.J., who testified that she filled out
and submitted timesheets when she provided services for E.J. The
government also offered the testimony of CPC nurse Deedra Davis-
Hussein, who testified that E.J. was mentally ill, sometimes
refused care when she did not want to be disturbed, and was capable
of refusing care for a week. Indeed, the evidence showed that CPC
sometimes went days or even a full week without providing any care
to E.J. For example, CPC did not bill DMAS for any personal care
hours for E.J. for the week of October 18-25, 2010. Viewed in the
light most favorable to the government, a reasonable juror could
credit this evidence and conclude that the reason no timesheet
existed for the week of January 3-9, 2011, was because CPC did not
provide any personal care services to E.J. that week. Although
the Perrys speculate that the timesheet could have been misplaced
14
or destroyed, 4 these possibilities do not undermine the evidence
supporting the jury’s verdict. As the district court noted, the
government was not required to provide direct evidence that CPC
employees did not work the hours in question, or to rule out every
innocent explanation for the missing timesheet. Instead,
“circumstantial evidence is treated no differently than direct
evidence, and may be sufficient to support a guilty verdict even
though it does not exclude every reasonable hypothesis consistent
with innocence.” United States v. Jackson, 863 F.2d 1168, 1173
(4th Cir. 1989). The Perrys’ challenge to Count 9 is therefore
rejected.
III.
The Perrys also raise several challenges to their convictions
on the counts involving respite care fraud. Counts 1, 2-5, and
10–13 involved CPC’s billing for, among other things, respite care
4 At trial, FBI Special Agent Kim Wright testified regarding,
among other things, her review of CPC’s records. Wright presented,
without objection, a summary chart for services performed for E.J.
See Fed. R. Evid. 1006. The chart indicated that for the week in
question Ms. McKay’s aide records reflected five hours worked for
E.J. but that CPC billed forty-two hours. On appeal, the Perrys
state that Wright’s chart was wrong because “[i]n fact, [E.J.’s]
patient file contained no timesheet for the week of January 3-9,
2011; that timesheet was missing completely, and no personal care
hours were documented for the week.” Reply Br. at 15. Even if,
as the Perrys argue, the jurors were “misled by the summary chart
about the personal care hours actually recorded for the week
involved in Count 9,” this would not help the Perrys insofar as
neither scenario (five documented hours or zero documented hours)
supports the hours billed.
15
services. At trial, the government argued that the relevant
respite care bills amounted to fraud because the company billed
for respite care hours that no employee worked or, alternatively,
for hours that employees worked on their own initiative without
providing any benefit to the patient’s primary caregiver.
The Perrys first argue that their convictions must be
overturned because the government offered false testimony
regarding DMAS respite care regulations. “The Supreme Court long
ago opined that, ‘a State may not knowingly use false evidence,
including false testimony, to obtain a tainted conviction.’”
United States v. Bartko, 728 F.3d 327, 335 (4th Cir. 2013) (quoting
Napue v. Illinois, 360 U.S. 264, 269 (1959)). “This is true
regardless of whether the Government solicited testimony it knew
or should have known to be false or simply allowed such testimony
to pass uncorrected.” United States v. Kelly, 35 F.3d 929, 933
(4th Cir. 1994). When the government offers false evidence that
it knows or should know is false, a conviction based on that
evidence “must be reversed when ‘there is any reasonable likelihood
that the false testimony could have affected the judgment of the
jury.’” Id. (quoting United States v. Agurs, 427 U.S. 97, 103
(1976)).
Before 2007, primary caregivers were required to live in the
home with their Medicaid patients in order to qualify for respite
care services. 12 Va. Admin. Code § 30-120-768(B) (2006). DMAS
16
removed this live-in requirement in 2007, before the conduct
charged in the indictment. See 12 Va. Admin. Code § 30-120-
766(B)(2) (2007). However, the live-in requirement continued to
be printed in the Virginia Medicaid Provider Manual until 2011.
Two witnesses testified that the regulation may have changed before
2011, and counsel for Mr. Perry cited some of this testimony to
the jury during closing arguments. By and large, however, both
sides assumed at trial that the live-in requirement remained in
effect until 2011 and solicited testimony to this effect. In
addition, the government asked various primary caregivers whether
they lived in the home with the Medicaid patients. Many of these
family members testified that they lived far away from their
patients and had never even heard of respite care.
The Perrys claim that testimony about the live-in requirement
misled the jury into believing that they committed fraud by billing
for respite care hours that CPC employees worked on behalf of
primary caregivers who did not live with their Medicaid patients.
If the government had presented this theory at trial, then the
Perrys might have cause for overturning their convictions. See
United States v. Moye, 454 F.3d 390, 400 n.10 (4th Cir. 2006)
(discussing the distinction between legally and factually
insufficient theories of prosecution). But the government did not
present this theory, nor did it so much as mention the live-in
requirement during closing arguments. In fact, Mr. Perry himself
17
testified that before 2011, the primary caregiver had to live in
the home.
Instead, the government stressed that testimony about the
Medicaid regulations was offered only as background information
and to help prove that the Perrys acted with fraudulent intent.
As the government explained in closing arguments, testimony about
the residences of particular family members was not offered to
establish that CPC provided respite care on behalf of ineligible
caregivers; instead, it was offered to establish that CPC did not
provide respite care at all because any hours they may have worked
could not have provided relief to family members who lived far
away and had no day-to-day care responsibilities for the patient.
In light of the Perrys’ knowledge and familiarity with the respite
care regulations, this provided evidence that the respite care
billing was fraudulent and not merely a product of accident or
mistake. The district court reinforced this point in its
instructions to the jury. In light of the government’s limited
use of the testimony surrounding the live-in requirement and the
district court’s instructions, there is no reasonable likelihood
that testimony about the live-in requirement affected the judgment
of the jury.
The Perrys also claim that the government misled the jury
into believing that primary caregivers must personally request
respite care rather than communicating through their patients. As
18
with the live-in requirement, the testimony on this point was vague
and muddled. A few government witnesses did appear to testify to
this effect, including Special Agent Wright, who stated, “If
there’s not a caregiver that has ever requested respite, the hours
billed are fraud.” J.A. 1450. Mr. Perry himself also agreed that
“the primary caregiver is the individual that’s supposed to be
requesting the use of the respite hours,” though he added that
requests “didn’t always happen that way as a practical matter.”
J.A. 2205. On the other hand, at least one government witness
stated that patients could call to schedule respite hours on behalf
of their caregivers.
We are not convinced that the testimony cited by the Perrys
was actually false; in context, these witnesses appear to have
been referring to the particular individual for whose benefit
respite care is provided, rather than the mechanics of how the
caregiver communicates with the home healthcare company. In any
event, this argument fails for the same reasons discussed above
with regard to the live-in requirement. Testimony that particular
primary caregivers did not request respite care was not offered to
establish that CPC relied on improper channels of communication,
but rather to establish that the respite care hours CPC claimed to
have worked were not provided for the primary caregiver’s benefit
and, thus, did not qualify as respite care. In light of the
Perrys’ knowledge and familiarity with the respite care
19
regulations, this provided evidence that the respite care billing
was fraudulent and not merely a product of accident or mistake.
And as with the live-in requirement, the district court’s
instructions limited the jury to this permissible use of this
evidence. Thus, there is no reasonable likelihood that this
evidence impermissibly affected the jury’s decision.
The Perrys next contend that the government impermissibly
used violations of civil regulations as the basis for their
criminal convictions. At trial, however, the district court
clearly instructed the jury that the Perrys were not charged with
violating civil regulations and that evidence of these regulations
was admitted only to show their knowledge and intent. The
government also stressed this point to the jury on multiple
occasions. In light of these admonitions, as well as undisputed
evidence that the Perrys were familiar with the regulations in
question, there was no danger that the jury would convict them of
fraud or knowingly making false statements simply because they
violated DMAS regulations.
Finally, the Perrys argue that the government’s theory of
respite care fraud renders their convictions void for vagueness.
“A statute is unconstitutionally vague if it fails to provide
people of ordinary intelligence a reasonable opportunity to
understand what conduct it prohibits, or if it authorizes or
encourages arbitrary and discriminatory enforcement.” McLean, 715
20
F.3d at 136. Here, DMAS regulations stated that respite care
services may only be provided “because of the absence of or need
for relief of those unpaid persons who routinely provide the care.”
12 Va. Admin. Code § 30-120-766(A)(1) (2008). At trial, the
government argued that hours billed for respite care services were
fraud, even if CPC employees actually worked them, so long as the
hours were worked without a request from the patient or caregiver
and without regard for whether the caregiver needed relief.
Contrary to the Perrys’ assertion, the regulations in
question are not unconstitutionally vague. True, at least one
witness testified that DMAS regulations governing respite care
services are looser than those governing personal care services.
But the DMAS regulations clearly provide that respite care services
may only be used to benefit “an unpaid caregiver who requires
temporary relief to avoid institutionalization of the individual.”
12 Va. Admin. Code § 30-120-766(B)(2) (2008). At trial, almost
every CPC witness — including Mr. Perry — testified that they
understood this basic contour of the regulations. No witness
expressed any doubt that billing for respite hours that either
were not worked or that were worked without regard to the needs of
an unpaid caregiver would be fraud. The Perrys’ argument therefore
lacks merit.
21
IV.
The Perrys next challenge the district court’s instructions
to the jury regarding the meaning of the term “willfully.” Counts
2-13 of the indictment charged the Perrys with violations of 18
U.S.C. §§ 1035 and 1347. Section 1035 makes it a crime to
“knowingly and willfully make[] any materially false, fictitious,
or fraudulent statements or representations” in any matter
involving a health care benefit program. Section 1347 makes it a
crime to “knowingly and willfully execute[], or attempt[] to
execute, a scheme or artifice to defraud any health care benefit
program.” The district court instructed the jury that, for the
purposes of these offenses, “[a] person acts ‘willfully’ . . .
when that person acts deliberately, voluntarily, and
intentionally.” J.A. 2795; see also J.A. 2793 (instructing the
jury that conduct is “knowing” when the actor is “conscious and
aware” of his actions, rather than acting due to “ignorance,
mistake, or accident”).
The Perrys contend that a defendant must know that his conduct
is unlawful in order to act “willfully” for purposes of §§ 1035
and 1347. Although the Perrys proposed a different instruction,
they did not specifically object to the district court’s
22
instruction at trial. 5 As a result, we review this instruction
for plain error. United States v. Nicolaou, 180 F.3d 565, 569
(4th Cir. 1999) (citing Fed. R. Crim. P. 52(b)).
An error is plain when it is “clear or obvious, rather than
subject to reasonable dispute.” United States v. Marcus, 560 U.S.
258, 262 (2010). Conversely, an error is not plain when this
“court has never addressed [the issue], and the other circuits are
split on the issue.” See United States v. Wynn, 684 F.3d 473, 480
(4th Cir. 2012).
“[I]gnorance of the law generally is no defense to a criminal
charge.” Ratzlaf v. United States, 510 U.S. 135, 149 (1994). The
First and Ninth Circuits have applied this general rule to
convictions under § 1035, holding that a defendant does not need
to know that his conduct is unlawful in order to act willfully for
the purposes of that statute. United States v. Russel, 728 F.3d
23, 31–33 (1st Cir. 2013), vacated, 134 S. Ct. 1872 (2014); United
States v. Ajoku, 718 F.3d 882, 889–90 (9th Cir. 2013), vacated,
134 S. Ct. 1872 (2014). However, the Supreme Court summarily
vacated those opinions and remanded the cases for reconsideration
5 The Perrys proposed an instruction that defined willfully
as “voluntarily and intentionally, with intent to do something the
law forbids, and with knowledge that [the defendant’s] conduct was
unlawful.” J.A. 4407. The government proposed a similar
instruction. See J.A. 2710 (defining willfully as requiring both
purpose and “knowledge that [the defendants’] conduct was, in a
general sense, unlawful”).
23
after the Solicitor General adopted a position similar to that
advanced by the Perrys in this case. See 134 S. Ct. at 1872. The
Perrys also point to two Supreme Court decisions recognizing an
elevated mens rea requirement for willfulness in other, unrelated
criminal statutes. See Bryan v. United States, 524 U.S. 184, 196–
200 (1998) (dealing in firearms without a license); Ratzlaf, 510
U.S. at 146–49 (restructuring financial transactions to avoid
reporting requirements). Finally, the Perrys rely on two recent
cases that cite the Bryan willfulness standard in reviewing the
sufficiency of the evidence in a § 1347 claim. See United States
v. Iwuala, 789 F.3d 1, 12 (1st Cir. 2015) (citing Bryan but
equating knowledge of unlawfulness with intent to defraud); United
States v. Franklin-El, 555 F.3d 1115, 1122 (10th Cir. 2009) (same).
The word willful has many meanings, which often vary depending
on the context in which the term is used. Ratzlaf, 510 U.S. at
141. Section 1035 closely tracks the language of 18 U.S.C. § 1001,
and courts have interpreted the two statutes as containing the
same mens rea requirement. See, e.g., Natale, 719 F.3d at 739–
42. This Court has endorsed jury instructions in the § 1001
context that were similar to the one given by the district court
in this case. See, e.g., United States v. Daughtry, 48 F.3d 829,
831–32 (4th Cir. 1995), vacated on other grounds, 516 U.S. 984.
In light of the foregoing, the meaning of the term willfully
in §§ 1035 and 1347 is, at a minimum, subject to reasonable debate.
24
Neither the Supreme Court nor this Court has directly addressed
the issue, and cases discussing “willfully” can be used to defend
and critique the district court’s instruction. For present
purposes, it suffices to say that Fourth Circuit law on this issue
is not clear at present, and thus the district court’s instruction
was not plainly erroneous. See United States v. Olano, 507 U.S.
725, 734 (1993) (stating that an appellate court “cannot correct
an error pursuant to Rule 52(b) unless the error is clear under
current law”).
In addition, even if the district court misconstrued the
meaning of the term willful, this would not warrant reversal of
the Perrys’ convictions. Jury instructions must be evaluated as
a whole, and the failure to give a particular instruction does not
warrant reversing a conviction unless the proposed instruction
covered a point that was not substantially covered by the court’s
other instructions to the jury. See Noel v. Artson, 641 F.3d 580,
586–87 (4th Cir. 2011) (citing Henderson v. Kibbe, 431 U.S. 145,
153 n.10 (1977), and United States v. Lighty, 616 F.3d 321, 366
(4th Cir. 2010)). Here, the other instructions adequately ensured
that the jury’s verdict was based on a correct understanding of
the law. Specifically, the district court instructed the jury on
fraudulent intent, which it defined as acting “knowingly and with
the intention or the purpose to deceive or to cheat . . .
accompanied, ordinarily, by a desire or a purpose to bring about
25
some gain or benefit to oneself or some other person or by a desire
or a purpose to cause some loss to some person.” J.A. 2830. And
the court instructed that false, fictitious, or fraudulent
statements or misrepresentations are “untrue when made or when
used and [are] known by the person making it or using it to be
untrue”; as well as “made or used with the intent to deceive.”
J.A. 2838. Most importantly, the court instructed that good faith
was a complete defense to all of the charges in the superseding
indictment because it was “inconsistent with the intent to defraud
or to obtain money by means of false or fraudulent pretenses,
representations, or promises.” J.A. 2803. And it explained that
if a person acts “on a belief or an opinion honestly held,” or
with the “absence of malice or ill will, and [with] an intention
to avoid taking unfair advantage of another,” then the person acts
in good faith and cannot be found guilty. J.A. 2803.
Viewed as a whole, then, these instructions ensured that “the
jury actually made an equivalent or identical finding” as that
contained in the willfulness instruction the Perrys argue should
have been given. See United States v. Whitfield, 695 F.3d 288,
304 (4th Cir. 2012). Under these circumstances, any error was
harmless and therefore not reversible, particularly under plain
error review. See id.Finally, the Virginia Provider Manual clearly stated that it
was a crime to fill out invoices falsely, and Mr. Perry admitted
26
that he knew the type of conduct alleged in counts 2 through 13
was illegal. All he denied at trial was being part of that conduct.
“No reasonable jury could have found that [the Perrys] intended to
deceive or cheat the Federal Government but did not know that such
conduct is unlawful, especially in light of the warnings” in the
Virginia Medicaid Provider Manual and elsewhere. See United States
v. Awad, 551 F.3d 930, 940 (9th Cir. 2009). Accordingly, the
totality of the record supports no other conclusion but that the
Perrys were guilty. Under these circumstances, the Court will not
reverse on plain error review. United States v. Cedelle, 89 F.3d
181, 185–86 (4th Cir. 1996). For each of these reasons, we reject
this challenge.
V.
For the foregoing reasons, the judgment of the district court
is
AFFIRMED.
27