United States v. Shanin Moshiri

In the
United States Court of Appeals
For the Seventh Circuit
No. 16-1126
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
SHANIN MOSHIRI, also known as
SHAWNI MOSHIRI,
Defendant-Appellant.
Appeal from the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 13 CR 312 — Matthew F. Kennelly, Judge.
ARGUED DECEMBER 7, 2016 — DECIDED JUNE 5, 2017
Before WOOD, Chief Judge, BAUER, Circuit Judge, and
SHADID,* District Judge.
*
Of the United States District Court for the Central District of Illinois,
sitting by designation.
2 No. 16-1126
BAUER, Circuit Judge. On July 2, 2015, after a bench trial,
Doctor Shanin Moshiri was convicted on one count of receiving
illegal remuneration in exchange for referring patients to
Sacred Heart Hospital in Chicago, Illinois, in violation of 42
U.S.C. § 1320a–7b(b) (Anti-Kickback Statute). On this appeal,
Moshiri challenges the sufficiency of the government’s
evidence and the district court’s admission of certain expert
testimony. For the following reasons, we affirm the conviction.
I. BACKGROUND
On March 18, 2014, Moshiri was charged, along with ten
other physicians and Sacred Heart administrators, with
participating in a scheme by which Sacred Heart paid physi-
cians for referring patients to Sacred Heart under the guise of
teaching and personal services contracts. Moshiri requested a
severance, waived his right to a jury trial, and proceeded to a
bench trial, during which the following facts were established.
Doctor William Noorlag was the director of the podiatry
residency program at Sacred Heart from 1999 to 2010. At trial,
Noorlag testified that in 2001, Edward Novak, the Hospital’s
owner and Chief Operating Officer, approached him express-
ing a desire to bring more podiatry patients to the Hospital. To
that end, Novak said that he wanted to begin paying podia-
trists pursuant to teaching contracts. It was Noorlag’s under-
standing that the teaching contracts would provide a vehicle to
pay physicians for patient referrals. At Novak’s direction,
Noorlag drafted the language to be used in these contracts.
Between 2001 and 2005, Sacred Heart entered into teaching
contracts with podiatrists Richard Weiss, Arshad Khan, and
Lewis Carrozza. Each of those contracts contained nearly
No. 16-1126 3
identical terms, based on the language Noorlag drafted. They
provided that Sacred Heart would pay the physician $2,000 per
month for performing duties within the residency program,
including teaching, performing administrative tasks, and
conducting residency workshops. Noorlag testified that at this
time, there were at least six other attending podiatrists who
performed teaching duties at the Hospital without receiving
any additional pay. He testified that the teaching contracts
were unnecessary because physicians had always taught
residents without such contracts.
Moshiri’s relationship with Sacred Heart began in Novem-
ber 2006, when he signed a teaching contract. He was to receive
$2,000 per month for performing duties similar to those
required by the contracts with Weiss, Khan, and Carrozza. The
contract also provided that Moshiri would serve as the
Director of External Podiatric Office Rotations for the residency
program. At this time, Carrozza’s contract, which was still in
effect, provided that he would serve in the same position.
According to Noorlag, however, neither Moshiri nor Carrozza
were considered to hold that title, and neither performed any
of the related duties. Instead, Doctor David Finkelstein held the
title of Director of External Rotations, performed the corre-
sponding duties, and did not receive additional compensation
from Sacred Heart for that work.
In April 2008, Moshiri signed a new contract with the
Hospital, pursuant to which he would receive $4,000 per
month for performing the same duties as those set forth in his
2006 contract. After signing this contract, Moshiri was receiv-
ing an annual salary of $48,000, while Noorlag, the Director of
the Residency Program, was receiving $40,000.
4 No. 16-1126
At trial, the government called Doctor Oleg Petrov to offer
an expert opinion on the standards for teaching contracts in
podiatric residency programs. Petrov was the Chair of the
Counsel on Podiatric Medical Education (CPME), which
oversees and certifies residency programs throughout the
country and publishes standards and requirements for those
programs. Petrov testified that he had conducted approxi-
mately 60 on–site evaluations of podiatric residency programs
during his time with CPME. He testified that teaching stipends
are uncommon for attending physicians associated with the
residency programs, and that he had never heard of such a
physician being paid as much as $2,000 per month. According
to Petrov, when physicians received teaching stipends, they
were typically between $200 and $4,000 per year, though he
acknowledged that payments fluctuated based on geographical
area.
According to multiple witnesses, Moshiri did not perform
the majority of his duties under the teaching contracts. He had
little involvement in the administration of the residency
program, did not conduct residency workshops, did not work
with residents in the Hospital’s clinic, and did not coordinate
or supervise the residents’ external rotations.
In addition, records showed that Moshiri spent less time
teaching and working with residents than many of the other
podiatrists associated with the program. The program kept a
log of the “didactic activities” physicians performed with
residents. Between 2006 and 2013, there were over 1,000 such
activities logged, and only nine of those were attributed to
Moshiri. During that same time, Moshiri worked with resi-
dents on podiatry cases just over three times per month on
No. 16-1126 5
average, while eleven other physicians in the program aver-
aged over ten cases per month with residents. The logs also
showed that Moshiri logged the lowest number of individual
procedures performed by a resident within each of those cases.
Between 2006 and 2013, Moshiri logged more surgeries at
Sacred Heart than any other attending podiatrist. During that
same period, the Hospital billed Medicare and Medicaid
approximately $482,000 for patients Moshiri treated.
In early 2013, law enforcement agents investigating the
Hospital secured the cooperation of Anthony Puorro, the Chief
Operating Officer. As part of his cooperation, Puorro recorded
a number of conversations with Moshiri.
In a conversation recorded on February 18, 2013, Puorro
told Moshiri that Novak wanted Moshiri to pick up his check
in person. In response, Moshiri suggested that when he came
to pick up the check, he could bring a “list of patients” he had
referred to the Hospital in case Novak wanted to see it. On
February 22, 2013, Moshiri met with Puorro to pick up his
check and provided him with a list of the surgeries he per-
formed at Sacred Heart in the previous month.
In another conversation recorded on March 8, 2013, Puorro
asked Moshiri if he had another list of patients, to which
Moshiri responded, “Not yet.” Moshiri asked Puorro if Novak
liked the list from last month. He then said that Novak “should
be very happy I bring my patients here. This is not the first, uh,
stop for me. Okay? … I’m the most active podiatrist in the
department of podiatry in this Hospital. … Six, seven patients
a month for podiatrist is a lot.”
6 No. 16-1126
Moshiri was arrested on April 16, 2013. Special Agent
Jeffrey Jamrosz informed Moshiri of his Miranda rights, and
Moshiri agreed to speak with him. Agent Jamrosz testified that
Moshiri explained that the meeting with Puorro to pick up his
check was atypical, and that he had provided the list of
patients to demonstrate what he had done for the Hospital.
Agent Jamrosz then testified that he asked Moshiri if the
teaching contract was a cover for payments for patient refer-
rals. According to Agent Jamrosz, Moshiri responded that “the
contract turned into basically paying for patients.”
Moshiri was charged with three counts of receiving illegal
payments in violation of the Anti-Kickback Statute. He waived
his right to a jury trial and proceeded to a bench trial. On
July 2, 2015, the district court found him guilty on one count.
The court noted that Moshiri did not function as the Director
of External Rotations and that he did not perform most of the
duties required by his contract. The court then explained that
it relied heavily on Moshiri’s recorded statements to Puorro
and his statement to Agent Jamrosz. It found that those
statements demonstrated that Moshiri understood he was
being paid not for teaching, but rather for patient referrals.
Moshiri then filed a motion seeking a judgment of acquittal
notwithstanding the verdict or, in the alternative, a new trial.
He argued that there was insufficient evidence to establish that
he knowingly or willfully violated the Anti-Kickback Statute;
that the admission of Petrov’s expert testimony was error; and
that the statute was unconstitutionally vague as applied in this
case. The district court rejected all three arguments and this
appeal followed, based on the same challenges.
No. 16-1126 7
II. DISCUSSION
A. Sufficiency of the Evidence
Moshiri’s first argument on appeal is that there was
insufficient evidence to support his conviction. He contends
that the government failed to prove that his teaching contracts
fell outside the Anti-Kickback Statute’s “safe harbor” provi-
sion, and that there was insufficient evidence to establish that
he knowingly or willfully violated the statute.
When reviewing a challenge to the sufficiency of the
evidence, “we view the evidence in the light most favorable to
the prosecution and ask whether any rational trier of fact could
have found the essential elements of the crime beyond a
reasonable doubt.” United States v. Salinas, 763 F.3d 869, 877
(7th Cir. 2014) (citing Jackson v. Virginia, 443 U.S. 307, 319
(1979)). We do not reweigh the evidence nor judge the credibil-
ity of witnesses. United States v. Galati, 230 F.3d 254, 258 (7th
Cir. 2000). If there is a reasonable basis in the record for the
verdict, it must stand. Id. (citation omitted).
The Anti-Kickback Statute prohibits a physician from
knowingly or willfully receiving payment, directly or indi-
rectly, in return for referring a patient for a service 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)(A). The
statute’s regulations provide a “safe harbor” for personal
services contracts if they meet certain criteria. See 42 C.F.R.
§ 1001.952(d). Generally, a contract is protected by the safe
harbor if its terms are for less than a year, the compensation is
consistent with fair market values, and the services are
reasonably necessary to accomplish the business goals of the
8 No. 16-1126
contracting entity. Id. If, however, the contract “takes into
account the volume or value of any referrals” for services to be
paid by a federal health care program, it is not protected. Id.
§ 1001.952(d)(5).
We need only briefly address Moshiri’s argument that the
government did not prove that his contracts fell outside the
safe harbor provision. To clear that hurdle, the government
needed to show only that the arrangement “[took] into account
the volume or value of any referrals” that Moshiri made to the
Hospital. Id. There was ample evidence presented to make that
showing, beginning with Moshiri’s own statements. In Febru-
ary 2013, Moshiri offered to bring a list of his patient referrals
to show Novak when he went to pick up his check. In March
2013, Puorro told Moshiri that Novak wanted to see another
list of referrals. Moshiri then asked if Novak was happy with
the previous list he provided. Additionally, Agent Jamrosz
testified that, after his arrest, Moshiri admitted that his
relationship with the Hospital had turned into receiving
payment for patient referrals. These statements also bolstered
the government’s evidence showing that Moshiri performed
fewer teaching activities than other physicians who were not
being paid to teach, and that he did not actually perform the
duties associated with the title conferred upon him under the
contract. This evidence was sufficient to demonstrate that
Moshiri’s arrangement with the Hospital took into account his
patient referrals, and therefore, fell outside the statute’s safe
harbor.
For many of the same reasons, Moshiri’s next argument
also fails. He contends that there was insufficient evidence to
prove that he knowingly violated the Anti-Kickback Statute.
No. 16-1126 9
Notably, the district court found Moshiri guilty of only one
count, which was associated with the check he received on
March 8, 2013. There was a sufficient basis in the record for the
district court to conclude that, when he accepted that check,
Moshiri knew he was being paid, at least in part, for referrals
rather than simply for the duties outlined in his contract.
Moshiri’s conversations with Puorro and his statement to
Agent Jamrosz are the most convincing evidence that Moshiri
knew he was receiving payment in exchange for referrals.
Moshiri’s references to the number of patients he brought to
the Hospital, his inquiry as to whether Novak was happy with
those numbers, and his subsequent admission to Jamrosz
indicate that he knew that he was not receiving the March 8,
2013, check only for his teaching.
The government also demonstrated that Moshiri was aware
of the Anti-Kickback Statute’s prohibitions by introducing a
Medicare enrollment form that Moshiri signed in 2012. By
signing that document, Moshiri certified that he would comply
with all Medicare rules and regulations, including the Anti-
Kickback Statute. Additionally, it was clear that Moshiri knew
he was not performing all of the duties outlined in his contract,
particularly as they relate to his title of Director of External
Rotations. When considered in the light most favorable to the
government, this illustrates his awareness that he was being
paid for something other than performing those duties.
Moshiri argues that the evidence did not make it clear
when, if ever, he became aware of the true nature of his
contract, and that there was nothing conclusive to show when
he stopped “harboring a good fath belief in the lawfulness of
his contract.” However, his conversations with Puorro, which
10 No. 16-1126
occurred on and before March 8, 2013, demonstrate that at
some time prior to his receipt of the payment on that date, he
was aware that his referral numbers were relevant to his
compensation.
In sum, Moshiri’s knowledge of the statute’s prohibitions,
the lack of work performed under the contract, and his
statements to Puorro and Agent Jamrosz clearly provided a
sufficient basis for the district court to find that Moshiri
received the March 8, 2013, payment with the requisite
knowledge under the Anti-Kickback Statute. Accordingly, we
find that there was sufficient evidence to support Moshiri’s
conviction.
B. Admission of Petrov’s Expert Opinion Testimony
Moshiri’s second argument on appeal is that the district
court committed reversible error by allowing Petrov to opine
on the fair market value of his contract. He contends that
Petrov was not qualified to render such and opinion and that
it was not based on sufficient credentials or methodology.
In Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579
(1993), the Supreme Court set forth the framework to be used
when determining the admissibility of expert testimony under
Federal Rule of Evidence 702. Moshiri does not argue that the
district court incorrectly applied the Daubert framework.
Therefore, we review the district court’s admission of Petrov’s
testimony for an abuse of discretion. See United States v. Allen,
269 F.3d 842, 845 (7th Cir. 2001).
Under Rule 702, an expert may offer opinion testimony “if
they have ‘specialized knowledge,’ are qualified based on
No. 16-1126 11
‘knowledge, skill, experience, training, or education,’ and the
expert’s testimony ‘will assist the trier of fact to understand
evidence or determine a fact at issue.’” Id. (quoting Fed. R.
Evid. 702). The district court acts as a “gatekeeper” in deter-
mining the relevance and reliability of the opinion testimony,
and enjoys “broad latitude” in making such a determination.
Kumho Tire Co. v. Carmichael, 526 U.S. 137, 141 (1999).
Moshiri takes issue with Petrov’s testimony that a typical
stipend for teaching physicians in podiatric residency pro-
grams is between $400 and $2,000 per year and that he had
never heard of an attending physician being paid as much for
teaching as Moshiri was under his contract. He argues that
Petrov was not qualified to give such an opinion, and that his
testimony was, therefore, unreliable.
This argument is unavailing. First, it is important to note
that, contrary to Moshiri’s contention, Petrov did not opine
as to the fair market value of Moshiri’s contract. The only
testimony he provided specifically as to Moshiri’s contract was
that he had never encountered such high compensation for
similar positions. Outside of that, Petrov only testified as to the
industry norms for such contracts based on his specialized
experience and knowledge within the field.
To demonstrate his qualifications, the government elicited
testimony detailing Petrov’s extensive background and
experience working in the field of podiatric residency. Petrov
testified that he had worked for the CPME for over 20 years,
during which time he conducted over 60 on–site evaluations of
podiatric residency programs. As part of those evaluations,
Petrov spoke with administrators regarding compensation for
12 No. 16-1126
attending physicians. That background provided a sufficient
foundation from which the district court could determine that
Petrov was qualified and that his testimony regarding a typical
teaching contract was reliable.
Moshiri makes much of the fact that Petrov’s testimony
was not based on an empirical analysis of podiatric residency
programs nationwide, and suggests that without that analysis,
Petrov’s testimony was unreliable. Such an argument, how-
ever, speaks to the weight of his testimony, not its admissibil-
ity, and is a matter ripe for cross-examination. See Gayton v.
McCoy, 593 F.3d 610, 616 (7th Cir. 2010) (noting that even
“‘shaky’ expert testimony may be admissible, assailable
by its opponents through cross-examination”). Indeed, on
cross-examination, Moshiri elicited testimony that Petrov did
not have specific knowledge of the workings of every program
in the country, nor the specific details of teaching contracts at
Sacred Heart or other Chicago hospitals.
Petrov testified as to the standards within the industry as
he had encountered them throughout his considerable per-
sonal experience. Such experience, even in the absence of any
empirical data, can provide an adequate basis for the admis-
sion of expert testimony. See Metavante Corp. v. Emigrant Sav.
Bank, 619 F.3d 748, 761 (7th Cir. 2010) (“An expert’s testimony
is not unreliable simply because it is founded on his experience
rather than on data … .”). The district court did not abuse its
discretion in determining that Petrov was qualified to provide
expert testimony on the nature of physician teaching contracts
in a podiatric residency program.
No. 16-1126 13
C. Constitutionality of the Anti-Kickback Statute
Moshiri’s final argument on appeal is that the Anti-Kick-
back Statute is unconstitutionally vague as applied to his case.
He urges us to overturn our holding in United States v. Borrasi,
639 F.3d 774, 782 (7th Cir. 2011), that “if part of the payment
compensated past referrals or induced future referrals,” it
constitutes a violation of the Anti-Kickback Statute. He asks us
instead to adopt a standard by which a conviction can stand
only if the payment for referrals constitutes the “primary
purpose” of the arrangement.
We recently rejected an identical argument in United States
v. Nagelvoort, -- F.3d --, 2017 WL 1959976 at *10 (7th Cir. 2017).
For the same reasons set forth in that opinion, we decline to
overturn Borassi, and hold that the Anti-Kickback Statute is
constitutional as applied to Moshiri.
III. CONCLUSION
For the foregoing reasons, we affirm the conviction.