U.S. v. Whited

• Decision Date: 19 November 2002
• Docket Number: No. 02-1112.,02-1112.
• Citation: 311 F.3d 259
• Parties: UNITED STATES OF AMERICA v. Ruth WHITED, Appellant
• Court: U.S. Court of Appeals — Third Circuit

Page 259

311 F.3d 259

UNITED STATES OF AMERICA v. Ruth WHITED, Appellant

No. 02-1112.

United States Court of Appeals, Third Circuit.

Argued July 29, 2002.

Filed November 19, 2002.

William Ruzzo [Argued], Kingston, PA, for Appellant.

Lorna N. Graham [Argued], Office of the U.S. Attorney, Scranton, PA, for Appellee.

Before BECKER, Chief Judge, ROTH and RENDELL, Circuit Judges.

OPINION OF THE COURT

RENDELL, Circuit Judge.

Ruth Whited appeals from the District Court's order sentencing her to prison and requiring her to make restitution for embezzling from a health care provider in violation of 18 U.S.C. § 669. Whited challenges the sufficiency of the charging indictment and the District Court's jurisdiction to adjudicate the charge as set forth therein. She also contends that the Commerce Clause does not grant Congress the power to criminalize her actions, and that 18 U.S.C. § 669 is thus unconstitutional as applied to the facts of her case. We note that we are the first court to address the constitutionality of this statute as an exercise of Congress' power under the Commerce Clause. We agree with the District Court that Whited's indictment sufficiently alleged the material elements of the offense and that her conviction withstands constitutional scrutiny, and will affirm.

I.

The relevant facts are not in dispute and may be briefly recounted. As a receptionist for the Back Mountain Chiropractic Center ("the Center"), Whited was responsible for receiving payment from Center patients. It was common practice for patients to pay by endorsing a check from their insurance provider, Blue Cross of Northeastern Pennsylvania ("Blue Cross"), to the Center. During 1996 and 1997, Whited deposited over fifty of those checks into her personal account, totaling over $34,000.

In early 2001, Whited was charged by indictment of one count of theft or embezzlement in connection with health care, in violation of 18 U.S.C. § 669. That provision provides, in relevant part:

Whoever knowingly and willfully embezzles, steals, or otherwise without authority converts to the use of any person other than the rightful owner, or intentionally misapplies any of the moneys, funds, securities, premiums, credits, property, or other assets of a health care benefit program, shall be fined under this title or imprisoned not more than 10 years, or both....

18 U.S.C. § 669.

The term "health care benefit program" is defined as:

any public or private plan or contract, affecting commerce, under which any medical benefit, item, or service is provided to any individual, and includes any individual or entity who is providing a medical benefit, item, or service for which payment may be made under the plan or contract.

Id. § 24(b).

The government's indictment charged:

That from on or about November 1996 and continuing up to and including on or about November 1997, in the Middle District of Pennsylvania, the Defendant, Ruth Whited, knowing and willfully embezzled, stole or otherwise without authority converted to the use of any person other than the rightful owner, or intentionally misapplied any of the monies, funds, securities, premiums, credits, property or other assets of a health care benefit program to wit: approximately $5,956.52 of subscriber checks from Blue Cross of Northeastern Pennsylvania, a health care benefit program within the meaning of 18 United States Code Section 24(b), which checks rightfully belonged to the Back Mountain Chiropractic Center located in Dallas, Pennsylvania.¹

Whited originally pled not guilty, and subsequently filed a motion to dismiss the indictment. She argued that the indictment was insufficient because, although she admitted she stole checks from the Center, the indictment appeared to charge that Blue Cross, rather than the Center, was the victim "health care benefit program." Further, she urged that Congress did not have the authority to criminalize embezzlement from individual medical care providers such as the Center. After the District Court denied the motion, Whited withdrew her original plea and pled guilty to the indictment. She was sentenced in January, 2002, and this timely appeal followed.

On appeal, Whited reiterates the challenges to the indictment she made in the District Court. First, she argues that the indictment does not allege an essential element of § 669, the theft or embezzlement from a "health care benefit program." In her view, the indictment refers to subscriber checks from Blue Cross, not the Center. She also contends that the Center is not a "health care benefit program" as defined in the statute. Thus, she asserts, the District Court lacked subject matter jurisdiction to adjudicate this matter because Congress did not criminalize embezzlement from a mere medical care provider such as a chiropractor. Finally, Whited argues that § 669 is unconstitutional as applied to this case. She admits to embezzlement from the Center, a medical care provider, but argues that Congress is without the authority under the Commerce Clause to criminalize that behavior because her theft from the Center lacked the requisite relation to interstate commerce.

The District Court exercised jurisdiction to determine the sufficiency of the indictment and interpret the relevant statutes pursuant to 18 U.S.C. § 3231, and we have jurisdiction under 28 U.S.C. § 1291. Although Whited did not preserve her right to appeal the pretrial motion by entering a conditional guilty plea, see Fed. R.Crim.P. 11(a)(2), all of the issues presented here properly fall within the narrow scope of review not barred by a guilty plea. See United States v. Rodia, 194 F.3d 465, 469 (3d Cir.1999) (stating that notwithstanding a guilty plea we retain jurisdiction over issues that "go[] to the jurisdiction of the District Court"); see also United States v. Garcia-Valenzuela, 232 F.3d 1003, 1006 (9th Cir.2000) (listing issues reviewable after an unconditional guilty plea, including the constitutionality of the underlying statute and that the indictment fails to state an offense); 15B Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 3918.7 (2d ed.1991) (same).

II.

Preliminarily, Whited argues that the indictment against her was insufficient because it failed to allege an essential element of the crime, and that the District Court was without subject matter jurisdiction to adjudicate the matter as set forth in the indictment. We find little merit to these arguments, and will treat them only briefly.

A.

We exercise plenary review over Whited's challenge to the sufficiency of the indictment. See Virgin Islands v. Moolenaar, 133 F.3d 246, 247 (3d Cir.1998). Whited argues that the indictment does not allege an essential element of § 669, specifically the theft or embezzlement from a health care benefit program. She notes that the indictment identifies Blue Cross as a health care benefit program, but reiterates that her theft was from the Center, which is never explicitly identified as a qualifying program in the indictment.

We consider an indictment sufficient if, when considered in its entirety, it adequately informs the defendant of the charges against her such that she may prepare a defense and invoke the double jeopardy clause when appropriate. See, e.g., United States v. Stansfield, 171 F.3d 806, 812 (3d Cir.1999); United States v. Turley, 891 F.2d 57, 59 (3d Cir.1989).

Whited's argument hinges on the unfortunate fact that the indictment says both too much and too little. Because Blue Cross was not the entity defrauded by Whited, whether or not Blue Cross is a health care benefit program under 24(b) was entirely irrelevant, and the indictment's identification of Blue Cross as a qualifying program was thus entirely superfluous. But because the indictment did identify Blue Cross as a health care benefit program under 24(b), the indictment was problematic in that it did not similarly identify the Center as a qualifying program.

Despite this carelessness in language, the facts alleged do amount to a crime under 669. Again, the indictment reads, in relevant part:

[T]he Defendant, Ruth Whited, knowing and willfully embezzled, stole or otherwise without authority converted to the use of any person other than the rightful owner, or intentionally misapplied any of the monies, funds, securities, premiums, credits, property or other assets of a health care benefit program to wit: approximately $5,956.52 of subscriber checks from Blue Cross of Northeastern Pennsylvania, a health care benefit program within the meaning of 18 United States Code Section 24(b), which checks rightfully belonged to the Back Mountain Chiropractic Center located in Dallas, Pennsylvania.

The indictment clearly states that the checks at issue "belonged to" the Center, and that the theft was from a health care benefit program. The Center is thus identified as a health care benefit program by implication. As we discuss below, the Center is in fact a qualifying "health care benefit program" because it is an "individual or entity who is providing a medical benefit, item, or service for which payment may be made under [a qualifying health care] plan or contract." 18 U.S.C. § 24(b). Consequently, when considered in its entirety the indictment's charge — that there was a theft from a health care benefit program of subscriber checks belonging to the Center — suffered from no material omissions, sufficiently apprised Whited of the charges against her, and would enable her to invoke the bar of double jeopardy if necessary. See Turley, 891 F.2d at 59; see also Hamling v. United States, 418 U.S. 87, 117, 94 S.Ct. 2887, 41 L.Ed.2d 590 (1974) ("[A]n indictment is sufficient if it, first, contains the elements of the offense charged and fairly informs a defendant of the charge against which he must defend, and, second, enables him to plead an acquittal or conviction in bar of future prosecutions for the same offense."). Further, we note...