United States v. Auzenne
| Decision Date | 04 April 2022 |
| Docket Number | 21-60124 |
| Citation | 30 F.4th 458 |
| Parties | UNITED STATES of America, Plaintiff—Appellee, v. Gregory Alvin AUZENNE, Defendant—Appellant. |
| Court | U.S. Court of Appeals — Fifth Circuit |
Francesco Valentini, U.S. Department of Justice, Criminal Division, Appellate Section, Washington, DC, Sara Elizabeth Porter, Jeremy Raymond Sanders, Trial Attorney, U.S. Department of Justice, Criminal Division Fraud Section, Washington, DC, Michael A. Rotker, Esq., U.S. Department of Justice, Criminal Division, Washington, DC, Kathlyn Rose Van Buskirk, Esq., Assistant U.S. Attorney, U.S. Attorney's Office, Southern District of Mississippi, Gulfport, MS, for Plaintiff—Appellee.
Robert Thomas Smith, Mary C. Fleming, Katten Muchen Rosenman, L.L.P., Washington, DC, Thomas M. Fortner, Esq., Lowrey & Fortner, P.A., Hattiesburg, MS, Rachel Malone Riley, Katten Muchen Rosenman, L.L.P., Dallas, TX, for Defendant—Appellant.
Before Barksdale, Engelhardt, and Oldham, Circuit Judges.
A jury acquitted Gregory Alvin Auzenne on seven counts. It hung on the eighth. Auzenne says the Double Jeopardy Clause bars the Government from retrying him on that eighth count. The district court said no. We agree and affirm.
Drug compounding is a way to "prepare medications that are not commercially available, such as medication for a patient who is allergic to an ingredient in a mass-produced product." Thompson v. W. States Med. Ctr. , 535 U.S. 357, 360–61, 122 S.Ct. 1497, 152 L.Ed.2d 563 (2002). When insurers began covering prescriptions for compounded drugs, they had to develop a systematic reimbursement formula. Many insurers decided to reimburse on a per-ingredient basis. This often resulted in reimbursements far exceeding the actual cost of ingredients.
Some pharmacies saw this as an opportunity to commit fraud. Between 2012 and 2014, for example, insurers noted a dramatic spike in reimbursement claims for compounded medications from certain pharmacies in Mississippi. Discrepancies of this nature eventually prompted an FBI investigation.
Auzenne was a pain-management doctor at Rush Hospital in Meridian, Mississippi. He worked in the hospital's Pain Treatment Center. Allegedly, Auzenne reached an agreement with pharmacist Marco Moran. The basic idea—again, allegedly—was as follows. First, Moran created a boilerplate prescription pad, designed to facilitate Auzenne in prescribing unnecessary medications. Second, Auzenne signed an incomplete form—often before even seeing the patient in question. Third, Auzenne's employee, Tiffany Clark, would step in. She'd make copies of the signed form, fill in certain patient information, and fax the form to Moran. Fourth, Moran would complete the form, selecting the compounding medication(s) the patient would receive, and send the prescription to specific pharmacies (which were themselves complicit in the scheme) for fulfillment. Two of those pharmacies were "Custom Care Pharmacy" and "RX Remedies." Fifth and finally, Moran would cash out by (fraudulently) completing an insurance reimbursement claim. All told, the alleged scheme involved about 200 fraudulent prescriptions and hundreds of thousands of dollars.
The alleged scheme's sine qua non —sending compounded drugs to people who didn't order or need them—led to its downfall. In 2014, a patient of the Pain Treatment Center received a compounded cream in the mail. This was a surprise: Nobody had prescribed the cream. When the patient got a call from the Center asking for her insurance information, she grew suspicious and complained to Rush Hospital administrators. After receiving another complaint about unsolicited medical cream, Rush Hospital began investigating Auzenne.
Also in 2014, Blue Cross & Blue Shield of Mississippi ("BCBS") noticed a spike in reimbursement claims from Custom Care Pharmacy for compounded medicines. So BCBS audited Custom Care.
In the fall of 2014 and pursuant to its audit, BCBS sent Auzenne two separate letters. Each letter included a detailed list of prescriptions that Auzenne had supposedly written. And they each asked Auzenne to indicate whether he had really written each prescription. At BCBS's request, Auzenne executed one affidavit for each letter. The affidavits acknowledged that he had written most, but not all, of the listed prescriptions.
Auzenne testified in his own defense at trial. He told the jury that he had discovered Clark's faxing of prescription forms to Moran. He testified that he considered this "completely inappropriate" and "unacceptable." He also testified that he eventually became so suspicious of Moran's "evasive" and "sloppy" behavior that he quit doing any business with him. And Auzenne testified about a meeting he had with Rush Hospital administrators. Specifically, when the administrators confronted Auzenne with the suspicious volume of compounded-medication scripts coming from RX Remedies, Auzenne "stated he was aware of the issues and that he had been in contact himself with" that pharmacy. Notably, each of these instances occurred before Auzenne executed the above-described affidavits.
The Government indicted Moran in 2018. Moran pleaded guilty and agreed to testify against both Auzenne and Clark. In 2019, the Government brought an eight-count indictment against Auzenne and a five-count indictment against Clark. The two cases went to trial together, and much of our above factual summary is based on witness testimony from that trial.
Count 1 charged conspiracy to commit wire fraud and healthcare fraud in violation of 18 U.S.C. § 1349. Counts 2–4 charged wire fraud in violation of 18 U.S.C. §§ 1343 and 2. Count 5 charged conspiracy to violate the Anti-Kickback Statute ( 42 U.S.C. § 1320a-7b(b)(1)(A)–(B) ) in violation of 18 U.S.C. § 371. Count 6 charged Auzenne with substantively violating the Anti-Kickback Statute. Count 7 charged conspiracy to distribute and dispense Tramadol, a Schedule IV controlled substance, in violation of 21 U.S.C. § 846.
The indictment's eighth count was based on Auzenne's responses to the BCBS affidavits. It alleged that those responses amounted to "[f]alse statements relating to health care matters" in violation of 18 U.S.C. §§ 1035 and 2. Count 8 listed three alternative ways in which Auzenne might have committed that violation:
Auzenne executed an affidavit under oath in response to an audit conducted by BCBS attesting that he authorized prescriptions for compounded medications for BCBS members that omitted how: (a) Auzenne had pre-signed blank prescriptions; (b) at Auzenne's direction, Clark had filled in patient and insurance information and faxed these fraudulent prescriptions to Moran; and (c) Moran had completed the fraudulent prescriptions deciding which compounded medications the BCBS members would receive, in violation of Title 18, United States Code, Sections 1035 and 2.
The jury acquitted Auzenne on Counts 1–7, but it hung on Count 8. (It acquitted Clark on all counts.) Auzenne moved to dismiss Count 8 on double-jeopardy grounds. When the district court denied that motion, Auzenne appealed to this court. Auzenne moved the district court for a stay pending appeal, and the court granted that motion.
Because Auzenne argues that the Fifth Amendment's Double Jeopardy Clause requires the dismissal of Count 8 in its entirety, the collateral order doctrine gives us jurisdiction over this appeal. See Abney v. United States , 431 U.S. 651, 658–62, 97 S.Ct. 2034, 52 L.Ed.2d 651 (1977) ; see also United States v. Lee , 622 F.2d 787, 791 (5th Cir. 1980) (). Our review is de novo. See, e.g., United States v. Brown , 571 F.3d 492, 497 (5th Cir. 2009).
We begin by (A) explaining the relevant rules of law. Then (B) we explain the narrow scope of our inquiry and hold the Double Jeopardy Clause does not bar retrial. We end by (C) addressing two additional arguments—one from Auzenne and one from the dissent.
The Double Jeopardy Clause provides: "No person shall ... be subject for the same offence to be twice put in jeopardy ...." U.S. CONST. amend. V, cl. 2. In Ashe v. Swenson , 397 U.S. 436, 90 S.Ct. 1189, 25 L.Ed.2d 469 (1970), the Supreme Court "identified a collateral estoppel ingredient in [the Double Jeopardy] Clause." Langley v. Prince , 926 F.3d 145, 155 (5th Cir. 2019) (en banc) (quotation omitted). The Ashe Court held that, "when an issue of ultimate fact has once been determined by a valid and final judgment," the Clause forbids the prosecution from relitigating that issue "in any future lawsuit." 397 U.S. at 443–46, 90 S.Ct. 1189.
According to our precedent, "collateral estoppel may affect successive criminal prosecutions in one of two ways." United States v. Brackett , 113 F.3d 1396, 1398 (5th Cir. 1997). First, collateral estoppel might "completely bar a subsequent prosecution." Ibid. That's the case "if one of the facts necessarily determined in the former trial is an essential element of the subsequent prosecution." Ibid. ; see also Bolden v. Warden, W. Tenn. High Sec. Facility , 194 F.3d 579, 584 (5th Cir. 1999) (). The theory appears to be that, if the Government can't possibly prove its case without violating Ashe , there's no point in letting retrial go forward at all.
But even in cases where "the subsequent prosecution may proceed," collateral estoppel still prohibits "the introduction or argumentation of facts necessarily decided in the prior proceeding." Brackett , 113 F.3d at 1398 ; accord United States v. Sarabia , 661 F.3d 225, 229 (5th Cir. 2011) (similar). The theory appears to be that, even when a retrial may proceed, the Government doesn't get to relitigate factual issues the first jury already decided.
The rub in both circumstances is that it's often difficult or...
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