United States v. Perry Reese, III

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 10-4218
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
PERRY REESE, III,
Defendant - Appellant.
Appeal from the United States District Court for the Eastern
District of North Carolina, at New Bern. Louise W. Flanagan,
Chief District Judge. (7:08-cr-00034-FL-1)
Submitted: June 23, 2011 Decided: August 2, 2011
Before WYNN and DIAZ, Circuit Judges, and HAMILTON, Senior
Circuit Judge.
Affirmed by unpublished per curiam opinion.
Jeffrey M. Brandt, ROBINSON & BRANDT, P.S.C, Covington,
Kentucky, for Appellant. George E. B. Holding, United States
Attorney, Jennifer P. May-Parker, David A. Bragdon, Assistant
United States Attorneys, Raleigh, North Carolina, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
Following a five-day jury trial, Perry Reese, III, was
convicted on two counts of dispensing a controlled substance in
violation of 21 U.S.C. § 841(a)(1) and one count of conducting
the affairs of an enterprise through a pattern of racketeering
activity in violation of 18 U.S.C. § 1962(c). The district
court sentenced Reese to 240 months’ imprisonment.
Reese challenges his convictions and sentence on
several grounds. First, he appeals the district court’s denial
of his motion for a judgment of acquittal. Alternatively, Reese
argues that the racketeering conviction should be vacated
because the district court erred in instructing the jury. With
respect to the 240-month sentence imposed by the district court,
Reese argues first that the district court erred in calculating
the drug weight used in determining his Sentencing Guidelines
range and second that the sentence was procedurally and
substantively unreasonable. For the following reasons, we
affirm.
I.
A.
Reese first argues that the district court erred in
denying his motion for judgment of acquittal pursuant to Rule 29
of the Federal Rules of Criminal Procedure, contending that the
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government’s evidence was insufficient to prove that he
unlawfully dispensed controlled substances. We review a
district court’s denial of a Rule 29 motion for judgment of
acquittal de novo, United States v. Alerre, 430 F.3d 681, 693
(4th Cir. 2005), and are required to sustain the jury’s verdict
if, viewing the evidence in the light most favorable to the
government, “a rational trier of fact could have found the
essential elements of the charged offense beyond a reasonable
doubt,” United States v. Singh, 518 F.3d 236, 246 (4th Cir.
2008). In reviewing a sufficiency claim, we “must consider
circumstantial as well as direct evidence, allow the government
the benefit of all reasonable inferences from the facts proven
to those sought to be established,” United States v. Tresvant,
677 F.2d 1018, 1021 (4th Cir. 1982), and “may not weigh the
evidence or review the credibility of the witnesses . . . those
functions are reserved for the jury,” United States v. Wilson,
118 F.3d 228, 234 (4th Cir. 1997).
Title 21 U.S.C. § 841 provides that “[e]xcept as
authorized by this subchapter, it shall be unlawful for any
person knowingly or intentionally . . . to manufacture,
distribute, or dispense . . . a controlled substance.” However,
medical doctors registered by the Attorney General “are
authorized to write prescriptions for or to otherwise dispense
controlled substances, so long as they comply with the
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requirements of their registration.” United States v. Hurwitz,
459 F.3d 463, 475 (4th Cir. 2006) (citing 21 U.S.C. § 822(b)).
Regulations promulgated by the Attorney General provide “that a
prescription for a controlled substance is effective only if it
is ‘issued for a legitimate medical purpose by an individual
practitioner acting in the usual course of his professional
practice.’ ” Id. (citing 21 C.F.R. § 1306.04(a)).
Thus, to convict Reese of the two 21 U.S.C. § 841charges, the government was required to prove that (1) he
“distributed or dispensed a controlled substance,” (2) “he acted
knowingly and intentionally,” and (3) his “actions were not for
legitimate medical purposes in the usual course of his
professional medical practice or [were] beyond the bounds of
medical practice.” United States v. Singh, 54 F.3d 1182, 1187
(1995) (quoting United States v. Tran Trong Cuong, 18 F.3d 1132,
1141 (4th Cir. 1994)).
As to the third element of the offense, Reese contends
that the government was required to prove that he distributed
controlled substances outside the usual course of his
professional practice and not for a legitimate medical purpose.
Reese argues that, at most, the government’s evidence was
sufficient to prove the former but not the latter.
We do not read the relevant statute and regulations as
requiring the proof urged by Reese. See, e.g., United States v.
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Hitzig, 63 F. App’x 83, 87 (4th Cir. 2003) (“We reject [the
defendant’s] contention that the district court erred because it
did not instruct the jury that the government was required to
prove that he both dispensed the controlled substances not for a
legitimate medical purpose in the usual course of professional
medical practice and in a manner that is beyond the bounds of
professional medical practice.”). Rather, “[o]ur precedent
makes it clear that the standard for criminal liability is that
the physician’s conduct in dispensing a controlled substance
falls outside the boundaries of the [physician’s] professional
practice. While the government may meet its burden of proving
guilt by showing that a physician dispensed a controlled
substance for an illegitimate purpose, the government is not
required to make such a showing.” Id. (internal citation and
quotation omitted). Accord Singh, 54 F.3d at 1187 (“[T]he
evidence must show that the defendant’s actions were not for
legitimate medical purposes in the usual course of his
professional practice or [were] beyond the bounds of medical
practice.”) (emphasis added; internal quotation omitted); Tran
Trong Cuong, 18 F.3d at 1138 (“The standard used by the
[district] court ‘without a legitimate medical purpose’ does
appear to be more strict than that required by Moore [423 U.S.
122 (1975)] and therefore was to defendant’s benefit.”). But
see United States v. Rosenberg, 585 F.3d 355, 357 (7th Cir.
5
2009) (“[I]n order for a prescription to be unlawful it must not
have a legitimate purpose and must be dispensed outside the
usual course of medical practice.”); United States v. Rosen, 582
F.2d 1032, 1033 (5th Cir. 1978) (holding that to convict a
doctor under 21 U.S.C. § 841 the government must prove that he
acted “other than for a legitimate medical purpose and in the
usual course of his professional practice”). In any event, the
district court instructed the jury on the heightened standard
proposed by Reese and the government’s evidence at trial was
more than sufficient to support the jury’s verdict.
With respect to Count I of the indictment, the
government’s evidence showed that Christy Brewington, a special
agent with the North Carolina State Bureau of Investigation
(“SBI”), made three undercover visits to Reese’s office while
posing as a patient, after the SBI had been tipped off that
Reese was selling prescriptions and controlled substances
directly to patients. Reese failed to perform any basic
diagnostic questioning or examination of Agent Brewington over
the course of her three visits, but rather simply complied with
Brewington’s request for pain medication (prescribing her
OxyContin during her first and third visits, and Percocet during
her second visit), instructed her on the “rules” in case
Brewington was questioned about the prescriptions, and collected
payment. The government’s evidence also showed that, following
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each visit, Reese falsified Brewington’s patient examination
forms to reflect medical tests that were never conducted and
discussion of pain and medications that never occurred.
As to Count II, involving Reese’s conduct with respect
to Elizabeth Sanders, the government’s evidence showed that
Reese conducted a limited physical examination of Sanders during
her first office visit, and thereafter abandoned any diagnostic
testing while increasing her prescriptions to about 20 pills of
Percocet per day. The evidence also showed that Sanders paid
Reese cash for prescriptions and gave him rings, watches, a
generator, and other items that Reese told her he wanted from
the pawnshop where she worked, that Sanders met Reese at various
locations to purchase the prescriptions, which involved payment
of Sanders’s insurance co-pay as well as additional cash fees,
and that Reese concealed some of the prescriptions he wrote to
Sanders by writing them in the names of her family members,
including Sanders’s teenage daughter.
Beyond these specific instances, the government’s
evidence also showed that Reese conducted limited or no physical
examinations of other patients and sold them prescriptions--and
in some cases sold them drugs directly. Reese also wrote
prescriptions in the names of his patients’ family members to
avoid triggering the suspicion of the authorities. One patient
testified that Reese told him to chew OxyContin pills for
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quicker effect. Moreover, Dr. Mark Romanoff, a pain management
specialist, opined that Reese’s actions in (1) failing to
conduct proper examinations, diagnosis, and follow-up, (2)
issuing patients prescriptions in others’ names, (3) re-
dispensing pills that patients had returned to him, (4) selling
pills directly to patients without a dispensing license, (5)
charging for a prescription without seeing the patient, (6)
routinely prescribing medications outside of the office setting,
(7) prescribing patients up to 20 pills per day, and (8)
recommending that one of his patients chew OxyContin, were all
inappropriate behaviors and beyond the bounds of professional
medical practice.
Viewing this evidence, as we must, in the light most
favorable to the government, we conclude that a rational trier
of fact would have little trouble finding that Reese’s actions
were outside the scope of medical practice and, even though the
government was not required to so prove, not for any legitimate
medical purpose. Accordingly, the district court did not err in
denying Reese’s motion for judgment of acquittal.
B.
Reese next argues that the district court erred when
it declined to instruct the jury that, for purposes of Count III
alleging a violation of the Racketeer Influenced and Corrupt
8
Organizations Act (“RICO”), the enterprise alleged by the
government to have been engaged in criminal activity must have
an existence separate from Reese. The enterprise alleged in
this case was Roseboro Urgent Care, P.A., out of which Reese ran
his medical practice and of which Reese was the sole proprietor
and the only physician. We review a “district court’s decision
to give or refuse to give a jury instruction for abuse of
discretion.” United States v. Passaro, 577 F.3d 207, 221 (4th
Cir. 2009) (citing United States v. Moye, 454 F.3d 390, 397-98
(4th Cir. 2006)). “We review a jury instruction to determine
whether, taken as a whole, the instruction fairly states the
controlling law.” Moye, 454 F.3d at 398 (internal quotation
omitted). An error in a jury instruction will warrant reversal
“only when the error is prejudicial based on a review of the
record as a whole.” United States v. Ellis, 121 F.3d 908, 923
(4th Cir. 1997).
Reese contends that the district court abused its
discretion when it eliminated the following sentence from the
proposed RICO instruction: “The enterprise must have some
separate existence from the defendant, that is, the defendant
cannot be both the RICO defendant and the RICO enterprise.”
Reese argues that the government must prove that “[t]he
enterprise must be distinct from the persons alleged to have
violated § 1962(c).” Palmetto State Medical Ctr. v. Operation
9
Lifeline, 117 F.3d 142, 148 (4th Cir. 1997). The government
does not contest this point, but argues that a distinction
between the enterprise and the defendant is established where
the enterprise is a legal entity and the defendant is a person.
Viewing the RICO instruction as a whole, we conclude
that the district court correctly instructed the jury that the
government must prove the existence of an enterprise, including
any legal entity such as a partnership, corporation, or
association, that the enterprise was engaged in interstate
commerce, and that the defendant was associated with or employed
by the enterprise. Thus, the district court fairly stated the
controlling law and did not err by omitting the proposed
statement from the instruction.
C.
Reese next challenges his sentence, arguing that the
district court improperly calculated the quantity of drugs
attributable to his conduct by failing to exclude prescriptions
written in good faith. We review the district court’s factual
findings as to the application of the Guidelines for clear
error. United States v. Daughtrey, 874 F.2d 213, 217 (4th Cir.
1989). Finding no clear error with respect to either point
Reese presses on appeal--that the district court’s estimate as
to the drug quantity attributable to Reese was not conservative
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enough and that the district court should have excluded the
quantity of drugs that Reese argues were prescribed for
legitimate medical purposes--we affirm the district court’s
calculations.
Finally, Reese argues that his sentence was both
procedurally and substantively unreasonable. We review
sentences “under a deferential abuse of discretion standard.”
United States v. Grubbs, 585 F.3d 793, 803 (4th Cir. 2009).
First, we review a sentence to “ensure that the district court
committed no significant procedural error, such as failing to
calculate (or improperly calculating) the Guidelines range,
treating the Guidelines as mandatory, [or] failing to consider
the § 3553(a) factors.” Gall v. United States, 552 U.S. 38, 51
(2007). Next, we review for substantive reasonableness,
“examin[ing] the totality of the circumstances to see whether
the sentencing court abused its discretion in concluding that
the sentence it chose satisfied the standards set forth in
§ 3553(a).” United States v. Mendoza-Mendoza, 597 F.3d 212, 216
(4th Cir. 2010).
Reese’s presentence report suggested a base offense
level of 32 on the ground that Reese distributed controlled
substances with a total marijuana equivalency exceeding 1000
kilograms. With six levels of enhancements, two each for
abusing a position of public or private trust, using a minor to
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commit the offense, and obstructing justice, the total offense
level was 38. 1 Because Reese had no prior criminal history, his
Guidelines sentence range was 235 to 293 months’ imprisonment.
Reese pressed for a downward departure from the Guidelines
sentence, based on mitigating circumstances that he argued were
not adequately considered by the Guidelines. The district court
rejected this argument and sentenced Reese to 240 months’
imprisonment, the effective Guidelines sentence based on the
statutory maximum for the two § 841(a)(1) counts.
Reese argues that the district court erred
procedurally by declining “to consider grounds founded in the
age of the defendant, his family connections and ties, his
military service, his lack of a criminal history, or his public
service, or other reasons offered.” J.A. 819. We disagree.
The district court declined to consider these factors
when assessing Reese’s argument for a downward departure from
the Guidelines sentence. As Reese conceded during sentencing,
the Guidelines specifically discourage a downward departure on
the basis of these factors except in extraordinary
1
Reese’s presentence report originally calculated a total
offense level of 42, having included an additional four points
on the basis that Reese was an organizer or leader of a criminal
activity involving five or more participants. However, the
government agreed that this adjustment was inappropriate and the
district court subtracted the four points, resulting in a total
offense level of 38.
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circumstances. The court, did, however, analyze the § 3553(a)
factors--including Reese’s military service, family history,
education, health, and service to community--before determining
that a 240-month sentence was sufficient and no greater than
necessary to accomplish the purpose of sentencing. Accordingly,
we find no procedural error in the district court’s sentencing
calculus.
Reese next argues that his sentence was substantively
unreasonable in light of all the § 3553(a) factors.
Specifically, Reese contends that the district court’s sentence
is too severe and far in excess of that imposed on others for
similar offenses. According to Reese, physicians previously
convicted of similar offenses have received drastically shorter
sentences–-in the range of seven to 78 months–-and that it is
“all but unheard of that a physician would be ordered to serve
20 years or more.” Appellant’s Br. 39.
First, we reject Reese’s argument that the cases he
cites provide a meaningful guidepost for assessing the
substantive reasonableness of his sentence. As the government
notes, the sentences that Reese points to as comparable are in
fact easily distinguishable based on, among other things, the
offenses charged, the schedule of the drug at issue, the drug
quantity, the applicability of certain departures or
enhancements, and the specific offender and offense
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characteristics that may have motivated the district court to
vary from an advisory sentencing range. Moreover, in enacting
the Sentencing Guidelines, “Congress sought proportionality in
sentencing through a system that imposes appropriately different
sentences for criminal conduct of differing severity.” U.S.S.G.
Ch. 1 Pt. A § 3. We are satisfied with the district court’s
determination that Reese’s sentence was proportional to the
severity of his charged conduct. Finally, we are to presume
that the district’s court’s chosen sentence is substantively
reasonable where, as here, it is within a correctly calculated
Guidelines range. Mendoza-Mendoza, 597 F.3d at 217. After
careful review, we find no cause to upset that presumption and
therefore affirm the district court’s sentence.
II.
For the foregoing reasons, we affirm the judgment of
the district court.
AFFIRMED
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