United States v. Ritchey

Decision Date24 May 2022
Docket Number1:21-cr-6-HSO-RPM-1
PartiesUNITED STATES OF AMERICA v. KENNETH BRYAN RITCHEY
CourtU.S. District Court — Southern District of Mississippi

UNITED STATES OF AMERICA
v.

KENNETH BRYAN RITCHEY

No. 1:21-cr-6-HSO-RPM-1

United States District Court, S.D. Mississippi, Southern Division

May 24, 2022


MEMORANDUM OPINION AND ORDER DENYING DEFENDANT KENNETH BRYAN RITCHEY'S MOTION [53] TO DISMISS COUNTS 3-6 OF THE SUPERSEDING INDICTMENT [33]

HALIL SULEYMAN OZERDEN, UNITED STATES DISTRICT JUDGE

BEFORE THE COURT is Defendant Kenneth Bryan Ritchey's Motion [53] to Dismiss Counts 3-6 of the Superseding Indictment [33]. This Motion is fully briefed. After due consideration of the Motion [53], the record, oral arguments of counsel made at the hearing held on April 14, 2022, and relevant legal authority, the Court finds that the Motion [53] should be denied.

I. BACKGROUND

On January 12, 2021, a Grand Jury returned a four-count Indictment [3] against Defendant Kenneth Bryan Ritchey (“Defendant” or “Ritchey”) charging him with conspiracy to commit wire fraud and mail fraud in violation of 18 U.S.C. § 1349 (Count 1); conspiracy to defraud the United States in violation of 18 U.S.C. § 371 (Count 2); conspiracy to hoard designated scarce materials in violation of 18 U.S.C. § 371 (Count 3); and hoarding designated scarce materials in violation of 50 U.S.C. §§ 4512 and 4513 (Count 4). Ind. [3] at 15-24.

1

The Government continued its investigation of Ritchey and on September 21, 2021, the Grand Jury returned the present Superseding Indictment [33] in this case, charging Ritchey with six counts: conspiracy to commit health care fraud and wire fraud in violation 18 U.S.C. § 1349 (Count 1); false statements relating to health care matters in violation of 18 U.S.C. §§ 1035 and 2 (Count 2); conspiracy to commit wire fraud and mail fraud in violation of 18 U.S.C. § 1349 (Count 3); conspiracy to defraud the United States in violation of 18 U.S.C. § 371 (Count 4); conspiracy to hoard designated scarce materials in violation of 18 U.S.C. § 371 (Count 5); and hoarding designated scarce materials in violation of 50 U.S.C. §§ 4512 and 4513 (Count 6). Sup. Ind. [33] at 23-35.

According to the Superseding Indictment [33], Ritchey operated and controlled Gulf Coast Pharmaceuticals Plus, LLC (“GCPP”), “a pharmaceutical wholesale company . . . that supplied pharmaceutical products” to various health care providers, “including those administered by the United States.” Id. at 1, 10-11. From January 2020 to April 2020, Ritchey and his co-conspirators allegedly participated in a scheme to defraud the United States through the United States Department of Veterans Affairs (“VA”) and other health care providers, by:

(a) acquiring and hoarding PPE and other designated materials
(b) soliciting health care providers, including VA health care facilities, to purchase [personal protective equipment (“PPE”)] and other designated materials at inflated prices, in excess of prevailing market prices through high-pressure sales tactics and through the omission of GCPP's actual costs and sources of PPE and other designated materials
2
(c) misrepresenting to health care providers, including VA health care facilities, through interstate wire transmissions, that the excessive prices of PPE and other designated materials were reasonable due to cost increases;
(d) selling and shipping, via interstate carrier, PPE and other designated materials to health care providers, including VA health care facilities;
(e) submitting and causing the submission of invoices and claims detailing the excessive prices to health care providers, including VA health care facilities, for the sale of PPE and other designated materials; and
(f) receiving and obtaining payments, through interstate wire transmissions, from health care providers, including VA health care facilities, based on the invoices and claims submitted.

Id. at 17.

On February 25, 2022, Ritchey filed the present Motion [53] to Dismiss Counts 3-6 of the Superseding Indictment [33]. Ritchey asserts that Counts 3 and 4 fail to allege conduct that constitutes a conspiracy to commit wire or mail fraud or a conspiracy to defraud the United States because they “do not allege an agreement to accomplish an unlawful act.” Mot. [53] at 12 (emphasis removed). Ritchey contends that Counts 5 and 6 are void-for-vagueness because the phrase “prevailing market price, ” as used in 50 U.S.C. § 4512, is unconstitutionally vague. Id. at 1, 21.

The Government takes the position that Ritchey's Motion [53] should be denied. Resp. [61]. It argues that Ritchey's Motion [53] inappropriately asks the Court to go beyond the allegations in the Superseding Indictment [33] as to Counts 3 and 4, and it contends that these Counts sufficiently plead conspiracies to commit wire and mail fraud and to defraud the United States. Id. at 5-15. The Government

3

maintains that Counts 5 and 6 are not void because § 4512 “provides sufficient notice of the conduct it prohibits.” Id. at 17.

In Reply [68], Ritchey argues that the Court need not go beyond the allegations in the Superseding Indictment [33] to dismiss Counts 3 and 4, because the alleged misrepresentations and omissions in Counts 3 and 4 are immaterial as a matter of law. Reply [68] at 2-5. Ritchey reasserts his argument that the phrase “prevailing market price” is unconstitutionally vague as applied to this case and attempts to distinguish the cases relied upon by the Government. Id. at 6-7.

On April 14, 2022, the Court held a hearing on the Motion [53] and heard argument from both parties. Min. Entry, Apr. 14, 2022.

II. DISCUSSION

A. Counts 3 and 4

1. Relevant legal standard

Ritchey seeks dismissal of Counts 3 and 4 on grounds that they omit an essential element of the offenses charged in each Count. Mot. [53] at 12-21. He does not argue that Counts 3 and 4 fail to fairly apprise him of the charges against him, nor does he contend that their wording presents a risk of future prosecutions on the same offenses. Id.

“[A] motion to dismiss an indictment for failure to state an offense is a challenge to the sufficiency of the indictment, ” and at this stage the Court must “take the allegations of the indictment as true and . . . determine whether an offense has been stated.” United States v. Kay, 359 F.3d 738, 742 (5th Cir. 2004)

4

(quoting United States v. Hogue, 132 F.3d 1087, 1089 (5th Cir. 1998)). The Court may not consider evidence beyond the allegations contained in the indictment in evaluating a motion to dismiss. See United States v. Mann, 517 F.2d 259, 267 (5th Cir. 1975) (holding that a defendant may not challenge an indictment “on the ground that the allegations are not supported by adequate evidence”); United States v. USPlabs, LLC, 338 F.Supp.3d 547, 580 (N.D. Tex. 2018) (applying Mann).

To be sufficient, “[a]n indictment must allege each element of the charged offense, in order to [ensure] that the grand jury finds probable cause that the defendant committed each element, to prevent double jeopardy, and to provide notice to the accused.” United States v. Bishop, 264 F.3d 535, 545 (5th Cir. 2001). Accordingly, an indictment is legally sufficient if “(1) it contains the elements of the offense charged, (2) it ‘fairly informs' the defendant of the charge he must meet, and (3) there is no risk of future prosecutions for the same offense.” United States v. Masha, 990 F.3d 436, 443 (5th Cir. 2021) (quotation omitted).

“Generally . . . an indictment that closely tracks the language [of the statute] under which it is brought is sufficient to give a defendant notice of the crimes with which he is charged.” United States v. Richard, 775 F.3d 287, 292 (5th Cir. 2014) (quotation omitted). “An indictment need not list every particular of the offense. Instead, it simply needs to allege each element of the crime in a way that allows the accused to prepare his defense and invoke the Double Jeopardy Clause in a subsequent proceeding.” Id. (quotation omitted).

5

“[T]he validity of an indictment is governed by practical, not technical considerations, ” United States v. Rainey, 757 F.3d 234, 247 (5th Cir. 2014) (quotation omitted), and an indictment that “tracks the language of the statute and additionally provides . . . factual allegations that ‘permit . . . no misapprehension as to the elements of the offense charged'” is sufficient, id. at 248 (quotation omitted).

2. Count 3

a. Count 3 sufficiently alleges the conspiracy

Count 3 charges Ritchey with conspiracy to commit wire and mail fraud in violation of 18 U.S.C. § 1349. Sup. Ind. [33] at 26-27. To support a conviction for conspiracy under § 1349, the Government must prove, and the indictment must allege, that: “(1) two or more persons agreed to commit fraud; (2) the defendant knew the unlawful purpose of the agreement; and (3) the defendant joined the agreement with the intent to further the unlawful purpose.” United States v. Beacham, 774 F.3d 267, 272 (5th Cir. 2014) (citation omitted).

For the first element, the indictment must allege an agreement to commit the underlying fraud offense. See United States v. Hoffman, 901 F.3d 523, 542 (5th Cir. 2018). The elements of wire fraud under 18 U.S.C. § 1343 are: “(1) a scheme to defraud and (2) the use of, or causing the use of, wire communications in furtherance of the scheme.” United States v. Stalnaker, 571 F.3d 428, 436 (5th Cir. 2009) (quoting United States v. Ingles, 445 F.3d 830, 838 (5th Cir. 2006)). Similarly, to prove mail fraud under 18 U.S.C. § 1341, the Government must prove: “(1) a scheme to defraud (2) which involves a use of the mails (3) for the purpose of

6

executing the scheme.” United States v. Mann, 493 F.3d 484, 493 (5th Cir. 2007) (quoting Ingles, 445 F.3d at 835)). However, “an indictment for conspiring to commit an offense-in which the conspiracy is the gist of the crime-it is not necessary to allege with technical precision all the elements essential to the commission of the offense...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT