U.S. v. Janati

• Decision Date: 09 July 2004
• Docket Number: No. 04-4081.,04-4081.
• Parties: UNITED STATES of America, Plaintiff-Appellant, v. Abdorasool JANATI; Forouzandeh JANATI, Defendants-Appellees.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 263

374 F.3d 263

UNITED STATES of America, Plaintiff-Appellant, v. Abdorasool JANATI; Forouzandeh JANATI, Defendants-Appellees.

No. 04-4081.

United States Court of Appeals, Fourth Circuit.

Argued: May 7, 2004.

Decided: July 9, 2004.

COPYRIGHT MATERIAL OMITTED

ARGUED: Steve Alan Linick, Assistant United States Attorney, Office of the United States Attorney, Alexandria, Virginia, for Appellant. Eric Lloyd Yaffe, Schmeltzer, Aptaker & Shepard, P.C., Washington, D.C., for Appellees. ON BRIEF: Paul J. McNulty, United States Attorney, Thomas H. McQuillan, Assistant United States Attorney, Alexandria, Virginia, for Appellant. Martin J. Gaynes, Roland B. Ninomiya, Schmeltzer, Aptaker & Shepard, P.C., Washington, D.C., for Appellee Abdorasool Janati; David Schertler, Barry Coburn, Coburn & Schertler, Washington, D.C., for Appellee Forouzandeh Janati.

Before NIEMEYER, MICHAEL, and TRAXLER, Circuit Judges.

Affirmed in part, reversed in part, and remanded by published opinion. Judge NIEMEYER wrote the opinion, in which Judge MICHAEL and Judge TRAXLER joined.

OPINION

NIEMEYER, Circuit Judge:

The government filed this interlocutory appeal during the course of a complex healthcare fraud prosecution, requesting that it be given what it contends is the necessary evidentiary latitude to prove its case.

Dr. Abdorasool Janati and his wife, Forouzandeh ("Suzie") Janati, have been indicted for a conspiracy in Northern Virginia from 1996 to 2003 to defraud the United States and private insurance plans of funds for medical reimbursement by submitting to Medicare and the private plans false claims for services allegedly performed by Dr. Janati and others in his neurology practice. In addition to the conspiracy count, Dr. and Mrs. Janati have been indicted in 61 additional counts alleging overt acts, representing some, but not all, of the criminal conduct allegedly undertaken in furtherance of the conspiracy.

On the district court's insistence that the government present its case in three days, the government noted that it could do so through the introduction of charts prepared under Federal Rule of Evidence 1006 and through "summary witnesses." It explained that the charts and witnesses would condense the evidence necessary to present to the jury approximately 1300 individual reimbursement claims that were made in furtherance of the conspiracy and in support of the specific overt acts alleged in Counts 2-62 of the indictment. Concerned about the length, scope, and complexity of the trial, the district court ruled that the government could use charts in its case-in-chief, but it could not refer in those charts or in testimony to any of the 1300 transactions within the scope of the conspiracy that were not alleged as overt acts:

[T]he charts in their case in chief could not contain any reference to those additional items that are not permitted in their case in chief [to prove the 61 overt acts], obviously. Neither charts or testimony or anything else about those additional [1300] claims.

Those would only become important, depending on what the defendant might testify to, they could be used in rebuttal.

But the court also ruled that co-conspirators and others could "testify to the conspiracy they saw." The court reiterated, however, that the parties would be held to three days each in the presentation of their cases.

The government contends that "the district court abused its discretion in preventing the government from introducing in its case-in-chief pattern-and-practice evidence showing that the Janatis submitted approximately 1,300 false claims (including the 61 false claims charged in the indictment) to Medicare and other insurers during the alleged conspiracy."

To the extent that the district court limited the government to proof of the conspiracy in its case-in-chief to the overt acts alleged in Counts 2-62 of the indictment, we reverse. Otherwise, we do not conclude that the district court abused its broad discretion to manage the scope of this large conspiracy case. We therefore affirm in part, reverse in part, and remand with instructions.

I

Dr. Janati, together with his wife, have for ten years operated a healthcare clinic known as the Neurological Institute of Northern Virginia, P.C., which has been engaged in the business of providing neurological testing and evaluations to patients. Over the period from 1996 through 2003, the Neurological Institute typically generated on a given day between 20 and 30 claims for reimbursement from Medicare and private insurance plans, involving the submission of thousands of claims and generating as much as $75,000 per month in gross proceeds.

In September 2003, the Janatis were indicted for healthcare fraud. The indictment, containing one count for conspiracy for the period 1996 through 2003 and 61 counts for overt acts in furtherance of the conspiracy during the period 2000 through 2002, alleges that the Janatis submitted false claims by overstating the services provided by Dr. Janati and Dr. Mian Li, a fellow neurologist at the Neurological Institute. Three types of false billing are represented in the indictment: claims that the Janatis (1) inflated the number of nerve conduction tests performed for patients, (2) billed but did not perform certain brain wave studies, and (3) "upcoded" office visits, falsely stating that the visit involved a complex medical diagnosis or procedure unsupported by the medical records.

The government has indicated in pretrial proceedings that, of approximately 1600 patient files that it examined from the Neurological Institute, it found that there was evidence of false billing in 1300, or more than 80% of those reviewed, resulting in losses of hundreds of thousands of dollars to Medicare and the other insured plans. Much of the government's proof will depend on the testimony of experts who have compared the medical records for patients of Dr. Janati and Dr. Li with the patients' billing records and who intend to give their opinions that the billing records overstate the work performed.

The district court has already conducted four pretrial conferences, and during the first conference, on November 21, 2003, the court, obviously concerned about the length and complexity of a trial, told counsel for the parties that "I am certainly not going to sit and listen to a thousand witnesses come through about a thousand case files. And I don't know how you plan to summarize this, but we may have to consider some kind of a severance and get this down to some kind of manageable piece of work to deal with." The government assured the court, "We plan to use summary charts extensively in this case because we recognize the volume of the documents and so forth. So, we are well aware of the constraints on the Court's time and so forth."

A few days later, the government submitted a paper to the court and opposing counsel, giving notice of its intent to offer summaries of voluminous evidence pursuant to Federal Rule of Evidence 1006. In this paper, the government stated that it intended to call no more than 12 patients as witnesses; that it anticipated extensive use of summary charts, which it intended to offer into evidence in its case-in-chief to prove the scope and extent of the conspiracy alleged in Count 1. The government indicated that because the Janatis intended to defend the case by blaming two billing employees who worked for the Neurological Institute between 2000 and 2003, it would have to prove "over 1000 instances" of fraud between 1996 and 2002 to show that the criminal conduct was widespread, intentional, and preceded the time when the two employees worked for the Janatis. Dr. Janati opposed the government's plan, filing a motion to preclude the government from using charts "to introduce expert opinions with respect to the contents of up to one thousand unique patient files."

At the second pretrial hearing, on December 12, 2003, the district court indicated that it was denying Dr. Janati's motion to exclude the government's use of summary charts, but without prejudice to objections that the Janatis might make at trial. The court stated, "I will listen to what specifics you may have once I see the charts and what they attempt to do with them in light of what evidence we have at the time." The court confirmed this ruling with a written order dated December 15, 2003.

At the third pretrial conference, on January 15, 2004, Dr. Janati expressed concern that the government was intending to prove transactions beyond the 61 overt acts alleged in the indictment, involving more than 1000 files relating to patient visits:

Our concern is not just the length of time it would take — You know, we could be here until Christmas trying to defend this case on each of these other thousand. But it would be extraordinarily prejudicial, I don't know how the Government ultimately would intend to put on these other supposed thousand instances of misconduct. And we don't think it is in any way proper in the case.

In response, the government noted that the conspiracy covered seven years and that the overt acts alleged in Counts 2-62 related only to misconduct occurring during 2000 through 2002. The government's attorney pointed out that if the government were denied the right to prove acts other than the 61 overt acts alleged in the indictment, "then we won't be able to show that there was misconduct occurring between '96 and 2000." The court indicated to the parties that it was not making any ruling about the admissibility of the charts at that time. But it expressed concern about the government's proving overt acts other than those alleged in the indictment: "It seems to me if you have got an indictment, the evidence ought to conform to the indictment you have got here. And you just don't simply find whatever evidence you have got out there and — I mean, people can't be on notice of what they are charged with and what they have to defend that way." After...