United States v. Patel, 13-1164

Decision Date08 September 2014
Docket NumberNo. 13-1182,No. 13-1216,No. 13-1164,No. 13-1215,No. 13-1173,13-1164,13-1173,13-1182,13-1215,13-1216
PartiesUNITED STATES OF AMERICA, Plaintiff-Appellee, v. BABUBHAI PATEL, BRIJESH RAWAL, KOMAL ACHARYA, VIRAL THAKER, and LOKESH TAYAL, Defendants-Appellants.
CourtU.S. Court of Appeals — Sixth Circuit

NOT RECOMMENDED FOR PUBLICATION

File Name: 14a0706n.06

ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF MICHIGAN

OPINION

BEFORE: COLE, Chief Judge; BOGGS and STRANCH, Circuit Judges.

STRANCH, Circuit Judge. In these consolidated cases, five defendants pursue direct appeals after they were convicted by a jury and sentenced for their roles in conspiracies to commit health care fraud and to distribute prescription drugs in Detroit over a period of five years. The leader of these conspiracies, Babubhai Patel, was a registered pharmacist and businessman who owned or controlled at least twenty pharmacies in Michigan. He hired other pharmacists, including his co-defendants Brijesh Rawal, Viral Thaker, and Lokesh Tayal, to assist him in defrauding Medicare, Medicaid, and Blue Cross/Blue Shield of Michigan of approximately $18.9 million. These co-conspirators unlawfully distributed millions of dosage units of controlled substances. Komal Acharya was involved in a personal relationship with Patel and assisted him as a member of the health care fraud conspiracy.

Patel, Rawal, Thaker, and Tayal challenge the district court's denial of their motions to suppress evidence obtained through a Title III wiretap on two cell phones used by Patel. They contend that the government failed to prove necessity for the wiretaps, failed to inform the issuing court that translators would monitor the phone lines, and failed to minimize nonpertinent calls. Thaker, Tayal, and Acharya each argue that the government's evidence was insufficient to convict them. Patel challenges the procedural reasonableness of his sentence.1 We AFFIRM the defendants' convictions and Patel's sentence.

I. BACKGROUND

The conspiracies began in January 2006 and ended in August 2011 when Patel and his associates were arrested, effectively ending their illegal activities. The number of pharmacies controlled by Patel varied over time, and he changed their corporate structures frequently. Patel hired all of the staff and supervised the pharmacy operations.

The scheme to defraud insurers depended on the participation of physicians, pharmacists, recruiters, and patients. Patel paid cash bribes to physicians to entice them to write patient prescriptions for expensive medications and controlled substances that could be billed to Medicare, Medicaid, or private insurers through the Patel pharmacies. He paid kickbacks to managers of health-related companies so that they would send patients to his pharmacies, and he employed "marketers" to recruit "patients" directly from the streets.

Pharmacists facilitated the criminal activity by charging insurers for expensive medications that were ordered from wholesale distributors and held in inventory but not dispensed to patients. These surplus medications were later returned to the supplier for credit or sold on the black market. Pharmacists also billed insurers for controlled substances that the pharmacists knew were illegally prescribed. These controlled medications included hydrocodone (Vicodin, Lortab), oxycodone (Oxycontin), alprazolam (Xanax), and codeine-infused cough syrup. When filling prescriptions, the pharmacists usually "shorted" the number of dosage units placed in the medication vials for patients, billed the insurers for the full drug quantities prescribed, and then sold the excess pills on the street.

A significant portion of the prescription fraud was perpetrated through Visiting Doctors for America (VDA), a physician group that purported to provide home doctor visits to patients. Marketers recruited "patients" from homeless shelters and soup kitchens by offering them small amounts of cash or controlled substances. The marketers transported the "patients" to a VDA physician, who performed cursory examinations of the "patients" while they sat together in one room. VDA staff provided the co-conspirators with dummy patient files and blank prescription pads previously signed by a physician or physician's assistant. Mehul Patel and later Arpit Patel, neither of whom is a physician, wrote prescriptions for controlled medications and expensive non-controlled medications on these blank, pre-signed prescription pads. The prescriptions were taken to the Patel pharmacies, where the pharmacists used the dummy patient files to enter patient profiles into the computer database, billed for all of the medications prescribed, but filled only the controlled medications. The controlled substances were then distributed, or sold on the street.

Patel paid his pharmacists salaries, bonuses, and twenty percent of pharmacy profits to encourage them to engage in fraudulent practices. The pharmacies distributed nearly 500,000 dosage units of Schedule II controlled substances (including oxycodone), approximately 4.9 million dosage units of Schedule III controlled substances (including hydrocodone), nearly 2.3 million dosage units of Schedule IV controlled substances (including alprazolam), and approximately 2.5 million dosage units of Schedule V controlled substances. Between 2006 and 2011, the Patel pharmacies billed Medicare approximately $37,770,557; Medicaid approximately $23,134,691; and Blue Cross/Blue Shield of Michigan approximately $6,359,872.

Babubhai Patel was convicted of health care fraud conspiracy in violation of 18 U.S.C. § 1349 (count 1), drug conspiracy in violation of 21 U.S.C. § 846 (count 15), ten counts of aiding and abetting health care fraud in violation of 18 U.S.C. § 1347 & § 2 (counts 2-5, 7-9, 12-14), and fourteen counts of aiding and abetting the unlawful distribution of controlled substances in violation of 21 U.S.C. § 841(a)(1) & 18 U.S.C. § 2 (counts 20-32, 34). He was acquitted on three counts of aiding and abetting health care fraud (counts 6, 10-11) and five counts of aiding and abetting the unlawful distribution of oxycodone and hydrocodone (counts 16-19, 33). The district court sentenced him to a total term of imprisonment of 204 months, supervised release of three years, and payment of restitution in the total amount of $18,955,869.

Brijesh Rawal was convicted of health care fraud conspiracy (count 1), drug conspiracy (count 15), one count of aiding and abetting health care fraud (count 5), and three counts of aiding and abetting unlawful distribution of controlled substances (counts 24-26). The district court sentenced him to a total term of imprisonment of 68 months, supervised release of three years, and payment of restitution in the amount of $1,761,217.

Viral Thaker was convicted of health care fraud conspiracy (count 1), drug conspiracy (count 15), two counts of aiding and abetting health care fraud (counts 10-11), and two counts of aiding and abetting unlawful distribution of controlled substances (counts 30-31). The district court sentenced him to a total term of imprisonment of 24 months, no supervised release with immediate deportation, and payment of restitution in the amount of $215,053.

Lokesh Tayal was convicted of health care fraud conspiracy (count 1) and drug conspiracy (count 15). The district court sentenced him to a total term of imprisonment of 68 months, no supervised release with immediate deportation, and payment of restitution in the amount of $3,658,174.

Komal Acharya was convicted of health care fraud conspiracy (count 1). The district court sentenced her to a term of three years of probation and restitution in the amount of $500,000.

We have jurisdiction of these appeals pursuant to 28 U.S.C. § 1291 and 18 U.S.C. § 3742.

II. ANALYSIS
A. Denial of the motion to suppress evidence

Defendants Patel, Rawal, Thaker, and Tayal challenge the district court's denial of their motions to suppress evidence obtained through the Title III wiretap, as well as all fruit of that evidence. In examining the denial of a motion to suppress, we review the district court's factual findings for clear error and its conclusions of law de novo. United States v. Poulsen, 655 F.3d 492, 503 (6th Cir. 2011). "It is well settled that in seeking suppression of evidence the burden of proof is upon the defendant to display a violation of some constitutional or statutory right justifying suppression." United States v. Rodriguez-Suazo, 346 F.3d 637, 643 (6th Cir. 2003)(quoting United States v. Feldman, 606 F.2d 673, 679 n.11 (6th Cir. 1979)); United States v. Giacalone, 853 F.2d 470, 482 (6th Cir. 1988); United States v. Smith, 783 F.2d 648, 650 (6th Cir. 1986). The defendant who requests suppression bears the burden of production and persuasion. United States v. Chaar, 137 F.3d 359, 363 (6th Cir. 1998); Giacalone, 853 F.2d at 482. We consider the evidence in the light most favorable to the government. Rodriguez-Suazo, 346 F.3d at 643.

1. Title III's necessity requirement

Congress granted statutory authority for law enforcement interception of private telephone conversations when it passed Title III of the Omnibus Crime Control and Safe Streets Act of 1968, 18 U.S.C. §§ 2510-20. The statute permits a federal judge to issue a wiretap order if the government establishes, in addition to specified probable cause requirements, that "normal investigative procedures have been tried and have failed or reasonably appear to be unlikely to succeed if tried or to be too dangerous," and that the wiretap application includes "a full and complete statement" in that regard. 18 U.S.C. § 2518(3)(c), (1)(c); United States v. Rice, 478 F.3d 704, 709-10 (6th Cir. 2007); United States v. Ogburn, 288 F. App'x 226, 236 (6th Cir. 2008).

This provision of Title III, which is known as the "necessity" or "needs" requirement, was added to "ensure that a wiretap 'is not resorted to in situations where traditional investigative techniques would suffice...

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