FILED
United States Court of Appeals
Tenth Circuit
PUBLISH
October 15, 2013
UNITED STATES COURT OF APPEALS
Elisabeth A. Shumaker
Clerk of Court
TENTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v. No. 12-6035
ADEDAYO O. ADEGBOYE,
Defendant - Appellant.
Appeal from the United States District Court
for the Western District of Oklahoma
(D.C. No. 5:11-CR-00030-D-1)
Perry W. Hudson, Oklahoma City, Oklahoma, for Defendant-Appellant Adedayo O.
Adegboye.
Amanda Maxfield Green, Assistant United States Attorney (Sanford C. Coats, United
States Attorney, with her on the briefs), Oklahoma City, Oklahoma, for Plaintiff-
Appellee United States of America.
Before MATHESON, EBEL, and O’BRIEN, Circuit Judges.
EBEL, Circuit Judge.
Following a joint trial with his Co-Defendant Olalekan Rufai, a jury convicted
Defendant-Appellant Adedayo Adegboye of five counts of aiding and abetting health
care fraud, in violation of 18 U.S.C. §§ 1347 and 2. On appeal, Adegboye argues that the
trial evidence was insufficient to establish, beyond a reasonable doubt, that he knowingly
and willfully participated in the fraud. Having jurisdiction under 28 U.S.C. § 1291, the
panel majority affirms Adegboye’s convictions. Judge Matheson writes separately to
dissent.
I. BACKGROUND
We incorporate the facts, procedural history, and legal background from our
opinion in the related appeal of United States v. Rufai, No. 12-6034, see §§ I, II.B.
II. THERE WAS SUFFICIENT EVIDENCE TO SUPPORT ADEGBOYE’S
CONVICTIONS
Adegboye argues that the Government failed to present sufficient evidence to
prove beyond a reasonable doubt that he committed health care fraud as a principal or as
an aider and abettor. Because the Government does not contend that he is guilty as a
principal, however, we focus here only on whether there was sufficient evidence to
convict him for aiding and abetting health care fraud.
Adegboye acknowledges that his business associate Joshua Ohaka committed
health care fraud by submitting false claims to Medicare through Adegboye’s company,
First Century Medical Supply (“First Century”). And Adegboye does not dispute that his
acts in fact contributed to Ohaka’s health care fraud generally, which would encompass
2
the incidents underlying the five substantive fraud counts charged against Adegboye. On
appeal, Adegboye argues that the Government failed to present sufficient evidence from
which a reasonable jury could have found, beyond a reasonable doubt, that he knowingly
and willfully aided Ohaka’s fraudulent scheme.
A. Relevant legal principles
Our decision to affirm Adegboye’s convictions is grounded on two legal
principles. First, we review the sufficiency of the evidence to support Adegboye’s
convictions de novo, asking “whether a reasonable jury could find [him] guilty beyond a
reasonable doubt.” United States v. Anaya, --- F.3d ---, 2013 WL 4308093, at *4 (10th
Cir. Aug. 16, 2013) (internal quotation marks omitted) (alterations omitted). In making
this determination, we must “consider all evidence and reasonable inferences in the light
most favorable to the government, and we may not weigh evidence or consider credibility
of witnesses.” United States v. Renteria, 720 F.3d 1245, 1253 (10th Cir. 2013). “Rather
than examining the evidence in bits and pieces, we evaluate the sufficiency of the
evidence by considering the collective inferences to be drawn from the evidence as a
whole.” United States v. Bader, 678 F.3d 858, 873 (10th Cir. 2012) (internal quotation
marks omitted) (alteration omitted), cert. denied, 133 S. Ct. 355 (2012). “[T]he evidence,
together with the reasonable inferences to be drawn therefrom, must be substantial, but it
need not conclusively exclude every other reasonable hypothesis and it need not negate
all possibilities except guilt.” United States v. MacKay, 715 F.3d 807, 812 (10th Cir.
3
2013) (internal quotation marks omitted), petition for cert. filed, (U.S. Aug. 26, 2013)
(No. 13-274).
Second, to obtain a conviction for aiding and abetting, the Government had to
prove beyond a reasonable doubt that Adegboye “(1) willfully associated himself with
[Ohaka’s] criminal venture and (2) sought to make the venture succeed through some
action of his own.” United States v. Rosalez, 711 F.3d 1194, 1205 (10th Cir. 2013)
(internal quotation marks omitted) (alteration omitted), petitions for cert. filed, (U.S. June
25, Aug. 9 and 26, 2013) (Nos. 13-5160, 13-5782, 13-6149). “[C]onduct of the
defendant or special circumstances may justify the inference that the defendant associated
himself with the criminal objective.” United States v. Burks, 678 F.3d 1190, 1198 (10th
Cir. 2012) (internal quotation marks omitted) (alteration omitted).
B. There was sufficient evidence to support Adegboye’s convictions for aiding and
abetting Ohaka’s health care fraud
1. Joshua Ohaka’s underlying fraud
Because the Government charged Adegboye with aiding and abetting his business
associate Joshua Ohaka’s health care fraud, we begin by addressing briefly Ohaka’s
fraudulent scheme. Ohaka’s modus operandi was to create a durable medical equipment
company; qualify that company as a Medicare provider; submit false claims to Medicare
through that company until Medicare became suspicious and began requiring the
company to submit proof of its claims; unable to present proof, Ohaka would then create
4
a new company through which to continue his fraud.1 Ohaka began this scheme by using
his own company, Optimed, through which he filed fraudulent Medicare claims from
2005 through approximately October 2006. He continued the scheme with Vitacare, a
company Ohaka formed in his wife’s name in 2007, and then he used his second
company, Providence, beginning in 2008. Later, Ohaka paid Helen Etinfoh to let him use
her name to operate another company, Luant and Odera, in 2008. This was likely due to
the fact that, by this time, Medicare had flagged for investigation any company that was
related to Ohaka. And Ohaka continued his fraud through First Century, a company that
he formed with Defendants Adegboye and Rufai in the fall of 2007.
The false claims Ohaka filed through these companies included billing Medicare
for equipment that he never provided Medicare beneficiaries, billing Medicare for more
expensive equipment than the equipment he actually provided beneficiaries (i.e.,
providing power scooters, but billing Medicare for more expensive power wheelchairs),
and providing beneficiaries with medical equipment that was medically unnecessary and
not prescribed for the beneficiaries by their doctors, as Medicare required. Often
Ohaka’s companies would bill Medicare using the code CR (catastrophe-related), which
indicated that a Medicare beneficiary had lost previously prescribed medical equipment
during a catastrophe, such as a hurricane. By using this code, Medicare would reimburse
1
Although we refer in this opinion only to Medicare, Medicare frequently acted through
various contractors. Those contractors, for instance, acted on Medicare’s behalf to
review applications to be a Medicare provider, conduct site visits of applicants, process
and pay provider claims for reimbursement, and investigate possible fraud.
5
Ohaka’s company for replacing the lost medical equipment without first requiring proof
that a doctor had prescribed the equipment for the Medicare beneficiary.
Ohaka opened four of the five companies he used to carry out his fraud (Optimed,
Vitacare, Providence and First Century) in Oklahoma, stocked them with minimal to no
inventory, and hired a very few employees to man the stores and company offices. The
same employees often worked for several of Ohaka’s companies. The only real business
these companies had was to file claims with Medicare seeking reimbursement. Ohaka
carried out his fraud by, first, using “recruiters” to obtain information from Medicare
beneficiaries, who usually lived in Texas or Louisiana. Then Ohaka, who lived in Texas,
would send this information to his employees in Oklahoma, direct them to use that
information to prepare the Medicare claim forms, his employees would do so and then,
pursuant to Ohaka’s instructions, send the completed claim forms either back to Ohaka or
to a billing company he used to bill Medicare.2
2
Evidence indicated that Ohaka would send “recruiters” out to take orders from real
Medicare beneficiaries. Even though those beneficiaries had never been prescribed
motorized scooters or wheelchairs, the “recruiters” apparently asked the beneficiaries if
they wanted a scooter or wheelchair, promised to deliver one, and then obtained from the
beneficiaries the information needed to file a claim for reimbursement from Medicare.
Sometimes Ohaka would not provide the beneficiaries with any equipment, but still bill
Medicare. Sometimes Ohaka would provide the beneficiary with a power scooter, but
bill Medicare for a more expensive power wheelchair. (As explained in footnote 3, infra.,
the five substantive counts of Medicare fraud charged against Adegboye appear to be this
type of fraud.) And sometimes the beneficiaries would not ask for any equipment, but
Ohaka would send them a power scooter anyway and then bill Medicare.
6
2. Evidence that Adegboye aided and abetted Ohaka’s fraud
The specific question presented in this appeal is whether there was sufficient
evidence from which a jury could find, beyond a reasonable doubt, that Adegboye
knowingly and willfully aided and abetted Ohaka’s fraud.3 “To establish knowledge and
willfulness, ‘the Government must prove that the defendant acted with knowledge that
his conduct was unlawful.’” United States v. Franklin-El, 555 F.3d 1115, 1122 (10th Cir.
3
The United States charged Adegboye with six counts. The jury acquitted Adegboye of
Count 1, charging him with conspiring to commit health care fraud. The jury also
convicted Adegboye on Counts 2 through 6, charging him with aiding and abetting five
substantive counts of health care fraud. Briefly summarized, the evidence regarding each
of those counts was as follows: Count 2 – On August 20 or 21, 2008, First Century
provided Medicare beneficiary Mary Smallwood with a power scooter, but charged
Medicare instead for a more expensive power wheelchair, for which Medicare
reimbursed First Century $3,516. Smallwood’s doctor had not prescribed either power
mobility device for Smallwood, as required for Medicare reimbursement. Count 3 – First
Century billed Medicare for providing Medicare beneficiary Rosa Mason, on July 15,
2008, a power wheelchair, which her physician had not prescribed, and for which
Medicare reimbursed First Century $3,516. Count 4 – On July 15, 2008, First Century
provided Medicare beneficiary Gladys Tatum with a power scooter, but billed Medicare
instead for a more expensive power wheelchair, for which Medicare reimbursed First
Century $3,516. Tatum’s doctor did not prescribe either power mobility device for her.
Count 5 – On August 4, 2008, First Century provided Medicare beneficiary Ms. Glendale
Sanders a power scooter, but billed Medicare instead for a more expensive power
wheelchair, for which Medicare reimbursed First Century $3,516. Sanders’ doctor did
not prescribe either device for her. Count 6 – On May 28, 2008, First Century provided
Medicare beneficiary Martha Eddington a power scooter, but billed Medicare for a more
expensive power wheelchair, for which Medicare reimbursed First Century $3,516.
Eddington’s doctor had not prescribed either device for her. Each of these beneficiaries
lived in Texas or Louisiana. And in each of these cases, First Century, in billing
Medicare, used the code CR, which was to be used when a Medicare beneficiary lost her
medical mobility equipment due to a catastrophe such as Hurricanes Katrina, Rita, and
Gustav. None of these Medicare beneficiaries, however, had been impacted by such a
catastrophe. Medicare would allow a claim of $4,000-5,000 for a power wheelchair, for
which Medicare would pay approximately $3,516. On the other hand, Medicare would
allow a claim of approximately $2,000 for a power scooter.
7
2009) (quoting Bryan v. United States, 524 U.S. 184, 191-92 (1998) (internal quotation
marks omitted) (emphasis omitted).) We conclude there was sufficient evidence to
support Adegboye’s convictions. More specifically, there was sufficient evidence from
which a reasonable jury could have found the following: 1) Adegboye knew that he and
Defendant Rufai were straw owners of First Century, that First Century’s only business
was with Medicare and its beneficiaries, and that it was actually Ohaka who was
operating the company; 2) Adegboye knew that he and Rufai were straw owners because
Ohaka wanted to hide his involvement in First Century from Medicare; 3) Adegboye
knew that Medicare was reimbursing First Century hundreds of thousands of dollars for
providing medical equipment to Medicare beneficiaries, and yet First Century had no
inventory and no apparent means to purchase inventory; 4) Adegboye knew Medicare
beneficiaries were complaining that they were not receiving equipment they had ordered
from First Century; 5) when Medicare began investigating First Century and throughout
Medicare’s investigation, Adegboye actively tried to cover up the fraud Ohaka was
committing through First Century; and 6) Adegboye profited from First Century’s fraud.
Considered together, this evidence was sufficient to support the jury’s ultimate finding,
beyond a reasonable doubt, that Adegboye knowingly and willfully aided and abetted
Ohaka’s fraud.
8
a. Evidence that Adegboye knew that he and Rufai were straw owners
of Ohaka’s company, First Century, whose only business was with
Medicare and its beneficiaries
We begin by considering what Adegboye knew about First Century. There was
evidence from which the jury could have found, beyond a reasonable doubt, that
Adegboye knew that he and Rufai were straw owners of First Century and that it was
Ohaka who actually ran the company. At Ohaka’s direction, Rufai incorporated First
Century in September 2007, naming Adegboye as First Century’s president and Rufai as
its vice president. There is no indication that, in doing so, Adegboye or Rufai contributed
any capital.
A month later, Adegboye, who lived in New York, visited Oklahoma City with
Rufai. At that time, directed by Ohaka, Adegboye and Rufai opened bank accounts for
First Century. There is no indication in the record as to who made any financial
contribution to First Century, and in what amount, when these bank accounts were
opened. Also at this time, Adegboye and Rufai, still directed by Ohaka, also obtained
general liability insurance for First Century and began making arrangements to lease
commercial space. Adegboye was also present when Ohaka hired an employee, Tracina
Pratcher, to work for both Ohaka’s company Vitacare and for First Century.
There was also evidence from which a jury could have found that Adegboye knew
that First Century’s business model was to provide only durable medical equipment that
would be reimbursable by Medicare. Although by January 2008, First Century opened in
a shopping center storefront, manned by one employee, Pratcher, First Century had no
9
inventory and never attempted to provide equipment in any context other than to
Medicare beneficiaries. Thus, although ostensibly open in January 2008, First Century
did no business until after Medicare approved it as a Medicare provider on May 20, 2008.
There was further evidence from which the jury could have found that Adegboye
knew, not only that Ohaka was actually the one operating First Century, but that Ohaka
was doing so in conjunction with his other companies. In addition to the evidence that
Ohaka hired Pratcher to work at both Ohaka’s company Vitacare and at First Century,
Adegboye was present when Ohaka directed his employees to train Pratcher on how to
complete the Medicare reimbursement forms. And Ohaka had his Vitacare office
manager contact Adegboye several times regarding administrative details that needed to
be addressed on First Century’s behalf.
Further, Adegboye and Rufai were the only signatories on First Century’s bank
accounts, and it was only Adegboye who wrote checks on the accounts. This put
Adegboye in a position to know that First Century was incurring expenses—rent, wages,
office equipment, remodeling work—but was not paying those expenses, at least not out
of First Century’s bank account. In fact, Bank of America eventually closed First
Century’s initial bank account due to inactivity. Not until several months after Medicare
began reimbursing First Century, in August 2008, did Adegboye pay First Century’s rent,
payroll and other overhead expenses from First Century’s new bank accounts. And once
Adegboye began paying those expenses for First Century, he also wrote checks for rent,
insurance and payroll for several of Ohaka’s other companies. Thus, Adegboye knew
10
that he and Ohaka were operating First Century in conjunction with Ohaka’s other
companies.
From all of this evidence, then, a jury could have found that Adegboye knew, from
the outset of First Century’s incorporation, that he and Rufai were straw owners of First
Century, which did business only with Medicare beneficiaries, and that Adegboye knew
that it was actually Joshua Ohaka who was running First Century, and running it in
conjunction with his other companies.4
b. Evidence that Adegboye knew that Ohaka wanted to hide from
Medicare the fact that Ohaka was actually operating First Century
There was also evidence from which a reasonable juror could have found, beyond
a reasonable doubt, that Adegboye knew that this business arrangement he had with
Ohaka, Rufai and First Century, in which he acted as one of the straw owners of First
Century, was the result of Ohaka’s desire to keep from Medicare the fact that he was
actually operating First Century. It was Adegboye who completed the application for
First Century to become a Medicare durable medical equipment provider. In making this
application, Adegboye misrepresented to Medicare that he alone owned and operated
First Century. See Franklin-El, 555 F.3d at 1121, 1123 (relying in part on the
defendant’s misrepresentations to uphold his conviction for health care fraud).
4
Neither the defense nor the dissent disputes that a jury could have found that Adegboye
knew 1) that he and Rufai were straw owners and 2) that it was Ohaka who was actually
running First Century.
11
More specifically, the Medicare application required Adegboye to list “[a]ll
persons who have a 5 percent or greater ownership (direct or indirect) interest” in First
Century; “all officers and directors” of First Century; “[a]ll managing employees,”
defined as “a general manager, business manager, administrator, director, or other
individual who exercises operational or managerial control over, or who directly or
indirectly conducts, the day-to-day operations” at First Century, whether or not that
person is a First Century employee; and “[a]ll individuals with a partnership interest” in
First Century. (Gov’t Ex. 1F, Section 6.) In response, Adegboye falsely listed only
himself, as an owner of 5% or more of First Century and as First Century’s managing
employee. Adegboye did not list Joshua Ohaka (or even Rufai for that matter) in any
capacity. This same section of the Medicare application further inquired whether any
listed person had been suspended from any federal health care program such as Medicare.
A jury could have found, then, that Adegboye misrepresented to Medicare that he,
and not Ohaka, owned and operated First Century. Adegboye made this
misrepresentation despite the one and one-half pages of notice to Medicare billing
applicants that making false representations in the application is a crime.
The Medicare application further mandated that the applicant update any of the
required information. Later, during and after the Medicare approval process, when
Medicare twice directed Adegboye to revise First Century’s documentation to list First
Century’s office manager as a managing employee, Adegboye still never mentioned
Ohaka.
12
Further, when Medicare first began investigating First Century, in October 2008, it
asked for a number of documents and other information that would bring First Century
into compliance with Medicare’s requirements. Adegboye, who assisted in providing
First Century’s response to Medicare’s request, still did not indicate that Ohaka was
involved in operating First Century. Even months after First Century ceased operating,
Adegboye and his attorneys, in explaining to investigating officials why Ohaka, and not
Adegboye, had possession of First Century’s records, indicated only that Ohaka was
Adegboye’s friend and still never mentioned that Ohaka played any role in operating
First Century. A jury could infer from this conduct that Adegboye, from the outset of
First Century’s incorporation, knowingly helped Ohaka hide from Medicare the fact that
Ohaka was the one actually operating First Century.
On appeal, Adegboye points out that the documents he submitted to Medicare
showed that First Century was connected with Ohaka. More specifically, as part of the
application to become a Medicare provider, Adegboye provided Medicare with copies of
contracts between First Century and Ohaka’s company Vitacare in which Vitacare agreed
to sell First Century medical equipment and to service equipment for First Century’s
customers. Ohaka signed one of those contracts. Nonetheless, this fact was not enough
to flag, for Medicare, Ohaka’s involvement in operating First Century. Nor does it
absolve the misrepresentations Adegboye made in applying, on First Century’s behalf, to
become a Medicare provider.
13
From the evidence presented at trial, then, a jury could have found, beyond a
reasonable doubt, that Adegboye knew that Ohaka did not want Medicare to know First
Century was Ohaka’s company and Adegboye took action to hide that fact from
Medicare. From this evidence alone, a jury might be able to infer that Adegboye thus
knew that Ohaka was committing Medicare fraud through First Century. But there was,
in any event, still more evidence from which a jury could infer that Adegboye knew the
specifics of Ohaka’s health care fraud.
c. Evidence that Adegboye knew that Medicare was reimbursing First
Century for medical equipment it purportedly provided to Medicare
beneficiaries, yet First Century had no inventory of durable medical
equipment, nor any apparent means to purchase such inventory
Although Adegboye was the straw owner of First Century, he was not completely
an absentee owner. Instead, he remained involved with the company’s operation
throughout its existence.5 Two aspects of Adegboye’s continued involvement with First
Century, in particular, put Adegboye in a position to know about the company’s
fraudulent Medicare billing. First, after applying on First Century’s behalf for a
Medicare billing number, Adegboye remained one of First Century contacts with
Medicare. And second, Adegboye (with Rufai) was the only one with control over First
5
This fact provides a contrast between Adegboye, whose convictions we uphold here,
and his co-defendant Rufai, whose convictions we reverse in an accompanying opinion.
There was no evidence presented to the jury that Rufai’s involvement in First Century
continued after January or perhaps March 2008, several months before Medicare
approved First Century to be a Medicare provider and, thus, several months before First
Century began filing false claims for reimbursement with Medicare. Adegboye, on the
other hand, remained involved with First Century throughout its existence.
14
Century’s bank accounts. Cf. United States v. Dazey, 403 F.3d 1147, 1156, 1160 (10th
Cir. 2005) (upholding fraud conviction in part because defendant controlled bank
accounts of fraudulent investment company).
As the person controlling First Century’s bank accounts, a jury could have found,
beyond a reasonable doubt, that Adegboye knew the following: First Century never had
an inventory of durable medical equipment. Nor did First Century have funds to
purchase equipment.
When Rufai incorporated First Century, neither Adegboye nor Rufai contributed
any capital. Nor was there any evidence that First Century obtained financing or other
funding to purchase inventory from any other source. First Century’s initial bank
account, opened in October 2007, was eventually closed for lack of activity. And,
although First Century incurred expenses during its start-up period—rent, wages,
insurance, office equipment, remodeling its rented commercial space—First Century
itself did not pay those expenses. Thus, in its start-up phase, First Century did not have
funding to purchase inventory.
When Adegboye initially applied for First Century to be a Medicare provider, in
January 2008, Adegboye did submit agreements he had signed with two of Ohaka’s other
companies, Optimed and Vitacare, extending credit to First Century to facilitate its
15
purchasing inventory from those two Ohaka companies.6 But there is no indication that
First Century ever purchased inventory from these two Ohaka companies.
During its pre-approval inspection of First Century, in March 2008, Medicare’s
inspector noted that First Century had little inventory on hand, only a manual wheelchair
and a walker contributed by First Century employee Tracina Pratcher. Due to the lack of
inventory, Medicare, before approving First Century to be a Medicare provider, requested
additional information from First Century in order to establish that it would be able to
purchase durable medical equipment to supply Medicare beneficiaries. This is because
Medicare has found that one of the telltale signs of fraudulent billing is a company’s lack
of inventory. In response to Medicare’s inquiry, Adegboye, in April 2008, provided
Medicare with a letter of credit from a non-Ohaka company, Summit Durable Medical
Equipment Co. There is no indication, however, that First Century purchased equipment
from Summit until late September 2008.
Medicare approved First Century to be a Medicare provider on May 20, 2008.
First Century immediately began submitting claims to Medicare for reimbursement, even
before it reopened its bank accounts on May 30, 2008. Yet there is no indication that
6
Medicare did not consider at least the letter of credit from Optimed to be valid, for
purposes of First Century’s application to be a Medicare provider, because Adegboye
failed to provide Medicare with a copy of this agreement that included both parties’
signatures.
16
First Century had any inventory, or had yet purchased medical equipment, at this point in
time.7
Through the next four months, from May 20 to September 30, 2008, First Century
billed Medicare $1.2 million for equipment provided to 150 Medicare beneficiaries. And
beginning August 1, 2008, Medicare deposited over $300,000 into First Century’s bank
accounts. And yet there was no indication that First Century had ever purchased or paid
for any durable medical equipment up until September 19, 2008. Adegboye’s continued
involvement with First Century and his control over First Century’s bank accounts placed
him in a position to know this.
Moreover, Adegboye physically visited First Century’s Oklahoma City storefront
sometime in September 2008. It was during this same time period that Medicare, on
September 22, 2008, conducted the unannounced inspection of First Century that
eventually led to that company’s downfall. During that inspection, Medicare noted that
First Century had almost no inventory at its office location (one manual wheelchair), the
employee manning the store did not know the name of the owner and, although
Adegboye, in the application he filed on First Century’s behalf, indicated that First
7
The record contains a receipt issued by one of Ohaka’s companies, Luant and Odera, to
First Century, dated May 7, 2008. That receipt indicates that First Century purchased
thirty-nine power wheelchairs for a sum of $39,000, for which First Century paid cash.
First Century, with Adegboye’s participation, submitted this receipt to Medicare in
November 2008, after Medicare began investigating, among other things, First Century’s
lack of inventory. A jury would not have had to credit this evidence, however, in light of
contradictory evidence from First Century employees, particularly Florida Raines, that
First Century had no inventory during this time period. See Dazey, 403 F.3d at 1160.
Adegboye does not specifically rely upon this receipt, either at trial or on appeal.
17
Century would keep its customer files at the First Century storefront, there were only
about ten files there, and those were incomplete and filled primarily with empty forms.
From that evidence, a jury could further infer that Adegboye, because he had physically
visited First Century at approximately the same time as Medicare’s inspection, was aware
that First Century, in September 2008, had no inventory and minimal to no customer
files.
From this evidence, then, a reasonable jury could have found, beyond a reasonable
doubt, that Adegboye knew that Ohaka was committing health care fraud through First
Century, knew the essential nature of that fraud, and knowingly and willfully aided that
fraud. There is, however, still more evidence to support Adegboye’s convictions.
d. Evidence that Adegboye knew First Century customers were
complaining about not getting equipment they ordered and receiving
equipment that they had not ordered
There was also some evidence that Adegboye was generally aware that First
Century customers had been calling to complain about not receiving equipment they
needed, and receiving equipment that they did not request. This evidence, considered
with the other evidence previously mentioned, would further support the jury’s finding
that Adegboye knew of Ohaka’s fraud and knowingly and willfully aided it.
e. Adegboye’s efforts to cover up First Century’s fraud
Perhaps the most compelling evidence that Adegboye knowingly and willfully
aided Ohaka’s fraud was evidence that Adegboye actively tried to cover up Ohaka’s
fraud, once Medicare began investigating First Century, in the fall of 2008. See United
18
States v. Verners, 53 F.3d 291, 295 (10th Cir. 1995) (upholding conviction for aiding and
abetting drug trafficking where, among other things, defendant actively attempted to
conceal drugs). After Medicare’s unannounced site visit to First Century, in September
2008, Medicare, on October 15, 2008, notified First Century that it had failed to comply,
in a number of ways, with Medicare’s standards applicable to durable medical equipment
companies. One of the deficiencies Medicare noted was that “[t]he inventory displayed
during your site inspection is not sufficient based on the amount you bill Medicare.”
(Gov’t Ex. 1N at 2.) (Recall that First Century, between May 20 and September 30,
2008, billed Medicare for over $1.2 million for medical equipment provided for Medicare
beneficiaries, yet there is no evidence that First Century purchased or otherwise acquired
any inventory during this same general time period.) “In order to prove compliance with
this [Medicare] standard,” Medicare directed First Century “to submit all invoices for the
month of June 2008, along with all credit agreements and contracts for inventory. These
credit agreements and contracts must contain all the information required by [Medicare]
to be considered valid.” (Id.) Medicare gave First Century twenty-one days to correct
this and a number of other deficiencies in its compliance with Medicare standards.
Adegboye participated in preparing First Century’s response to this notice and its
attempt to correct the cited deficiencies. In response to Medicare’s direction to submit
First Century’s June 2008 invoices, First Century submitted, among other documents, an
invoice from another of Ohaka’s companies, Luant and Odera, indicating that on May 7,
2008, Luant and Odera sold First Century $39,000 in power wheelchairs, for which First
19
Century paid cash;8 a list indicating that First Century had purchased over $74,000 in
medical equipment from Summit between June 1 and November 7, 2008; and invoices
from Summit to First Century dated between September 19 and November 6, 2008.
In addition, within one week of Medicare’s October 15, 2008 notice to First
Century, Adegboye wrote a check on one of First Century accounts for $115,000, payable
to one of Joshua Ohaka’s other companies, Providence, purportedly for the purchase of
equipment. Adegboye himself then endorsed the check for Providence and deposited the
check in Providence’s account. While First Century did have contractual relationships
and letters of credit with other companies owned and operated by Joshua Ohaka, there is
no evidence that First Century had any such relationship with Ohaka’s Providence. Nor
is there any indication that First Century actually obtained any medical equipment from
Providence. A jury could reasonably have found, beyond a reasonable doubt, that
Adegboye’s thus transferring over $115,000 in funds from First Century to Providence,
and his participation in submitting to Medicare the wrong invoices, were efforts
Adegboye undertook to cover up the health care fraud that Ohaka was committing
through First Century. The jury could, thus, have found beyond a reasonable doubt that
Adegboye knew of Ohaka’s fraud and aided it.
8
As previously mentioned, the jury would not have been required to credit the veracity of
this receipt, in light of contrary testimony from Florida Raines, who was working at First
Century at this time, that First Century did not purchase any medical equipment and did
not have any inventory during this same time period. See Dazey, 403 F.3d at 1160.
20
But there is still more. In October 2008, Medicare placed First Century on
prepayment status, meaning Medicare would not reimburse any more claims from First
Century until First Century submitted to Medicare documentation to prove each claim
submitted. When First Century could not comply with Medicare’s requests for
documentation of its claims, and when First Century failed to correct its noncompliance
with Medicare’s standards for durable medical equipment suppliers, Medicare, in January
2009, revoked First Century’s Medicare provider number. At that time, Medicare again
requested First Century’s records. No one, including Adegboye, responded to that
request for months.
In July 2009, the United States indicted Joshua Ohaka for health care fraud
committed through another of his companies, Luant and Odera. In August 2009,
Adegboye’s attorney sent a letter notifying the Federal Bureau of Investigation (“FBI”)
that when FBI agents in Houston seized documents from Ohaka, they also seized First
Century’s records. Adegboye’s attorney explained to the FBI that the reason Ohaka had
First Century’s records was because Adegboye had given those records to Ohaka for
“safekeeping,” when Adegboye was in the process of moving First Century to New York.
Adegboye’s attorney asked the FBI to sort through the records it had seized from Ohaka
and remove First Century’s records and return those to Adegboye, so he could respond to
Medicare’s request for his First Century records. Adegboye still did not reveal Ohaka’s
role in operating First Century.
21
Medicare apparently asked Adegboye again for First Century’s records on
September 16, 2009. In response, Adegboye sent a sworn affidavit to Medicare,
indicating the following: He owned First Century; because of financial difficulties,
Adegboye decided to move First Century from Oklahoma City to New York; for this
reason, Adegboye requested that his long-time friend Ohaka box First Century’s files and
ship them to Adegboye in New York; because Ohaka lives in Texas, he first took First
Century’s records to his home in Houston; when the FBI seized Ohaka’s files, agents
seized First Century’s files, too; although Adegboye’s attorney had requested that the FBI
locate First Century’s files and return those to Adegboye, Adegboye had not yet heard
back from the FBI. For these reasons, Adegboye asked Medicare for additional time to
respond to its request for First Century’s records. Adegboye, then, continued to
misrepresent that he was First Century’s owner and Ohaka was not involved in running
the company.9
9
This case is distinguishable from United States v. Rahseparian, 231 F.3d 1257 (10th Cir.
2000), on which the dissent relies. In Rahseparian, this Court reversed Jack
Rahseparian’s convictions for mail fraud and conspiracy to commit mail fraud, which
were based solely on false exculpatory statements that Rahseparian made to police one
and one-half years after the conclusion of a fraudulent scheme operated by others through
a business with which Rahseparian was tangentially involved. Id. at 1261-64. This Court
concluded that Rahseparian’s after-the-fact exculpatory statements did not support the
inference that he knew of the fraud at the time it was occurring. Id. at 1264. In this case,
assuming Adegboye’s September 2009 after-the-fraud affidavit was an exculpatory
statement—if Adegboye had not known of Ohaka’s fraud, a more exculpatory statement
might have been that it was really Ohaka who was running First Century—there was,
unlike in Rahseparian, additional evidence indicating Adegboye had been aware, the
entire time, of Ohaka’s scheme to defraud Medicare through First Century, and that
Adegboye acted to facilitate that scheme throughout First Century’s existence. Thus, a
22
Even more telling, however, was that, just a month before Adegboye and his
attorney indicated to investigators that Ohaka was not involved in running First Century,
Adegboye was taking a markedly different tone with Ohaka. On July 6, 2009, Adegboye
sent Ohaka an email stating the following:
I know you have refused to pick my calls. No PROBLEM. But the issue of
First Century is a recurring decimal, not untill [sic] we sit down and tackle
the issue like matured and responsible adults, we are only postponing the
evil day. And i [sic] pray it does not get to that stage.
Please go through the attached doc. [a collection notice indicating that
Adegboye, as First Century’s rent guarantor, owed over $43,000 for First
Century’s unpaid rent] and advise. They claim no key was giving [sic] to
them., [sic] which you confirmed to be true.
I will be expecting your call.
(Ex. 31.)
From this evidence, viewed together with the other evidence previously
mentioned, a jury could find, beyond a reasonable doubt, that Adegboye knowingly and
willfully aided Ohaka’s fraud, including actively trying to cover it up.
f. Adegboye profited from First Century’s fraud
Lastly, there was evidence that Adegboye profited some from First Century’s
fraud. This evidence further supports the jury’s finding, beyond a reasonable doubt, that
Adegboye knew about Ohaka’s fraud and willfully aided it. See Verners, 53 F.3d at 295
(upholding conviction for aiding and abetting drug trafficking where, among other things,
reasonable jury could have found that Adegboye’s September 2009 affidavit was a
continuation of his efforts undertaken throughout the fraudulent scheme to help Ohaka
conceal from Medicare his involvement in First Century.
23
evidence indicated that defendant benefitted from drug trafficking occurring in her
home).
g. Viewing this evidence as a whole, a reasonable jury could have
found Adegboye guilty, beyond a reasonable doubt, of knowingly and
willfully aiding and abetting Ohaka’s health care fraud
Viewed in isolation, there could be innocent explanations for at least some of these
circumstances, explanations which could have led a reasonable jury to find that Ohaka
had duped Adegboye into unknowingly being the straw owner of a company through
which Ohaka was defrauding Medicare. But viewing the evidence as a whole, a
reasonable jury could also have found that Adegboye knew all along that Ohaka was
defrauding Medicare through First Century, that Adegboye knowingly and willfully
associated himself with that venture, and that Adegboye took action to help the venture
succeed. That is sufficient evidence for a reasonable jury to find beyond a reasonable
doubt that Adegboye aided and abetted the five substantive fraud counts charged against
him.10 See United States v. Phillips, 543 F.3d 1197, 1210 (10th Cir. 2008) (affirming
aiding-and-abetting convictions where, “[e]ven if none of the[] facts, taken alone, would
be sufficient proof to uphold [the defendant’s] convictions, the combination” of facts
supported by the evidence was sufficient to uphold the convictions).
10
We do not read Adegboye’s brief to make a separate argument that his convictions
were the result of jury confusion and mistake. But, to the extent he is making such an
argument, we reject that contention as well. In response to the jury’s notes sent to the
trial court during the jury’s deliberations, the court gave jurors additional instructions that
cleared up any confusion.
24
III. CONCLUSION
The question of whether there was sufficient evidence to support the jury’s
finding, beyond a reasonable doubt, that Adegboye aided and abetted Ohaka’s fraud is a
close one. But the jury found that Adegboye knew about Ohaka’s fraudulent scheme,
willfully associated himself with that scheme, and acted to aid that scheme’s success.
Because the Government presented sufficient evidence from which a reasonable jury
could have reached that finding, beyond a reasonable doubt, we AFFIRM Adegboye’s
convictions.
25
12-6035, United States v. Adegboye
Judge MATHESON, dissenting1
The majority correctly concludes the sufficiency of the evidence issue “is a close
one.” Maj. Op. at 24. The Government presented substantial evidence that Medicare
fraud occurred at First Century. In the related appeal of United States v. Rufai, No. 12-
6034, we concluded that the Government proved Mr. Ohaka knowingly committed
Medicare fraud and Mr. Rufai and Mr. Adegboye performed functions at First Century
that enabled Mr. Ohaka to do so. But proving what happened is not the same as proving
knowledge. In Rufai, we held the evidence was insufficient to prove that Mr. Rufai
knowingly aided and abetted health care fraud. Although Mr. Adegboye’s case is a closer
one, I would hold the same here. The Government’s strong case against unindicted
Medicare defrauder Mr. Ohaka should not be improperly imputed to others.
The critical issue is whether Mr. Adegboye knew about the fraudulent Medicare
billing scheme at First Century and intended to defraud Medicare. At trial, the
Government presented no direct evidence of Mr. Adegboye’s knowledge and intent, so
the issue is whether the jury could reasonably have inferred knowledge and intent beyond
a reasonable doubt based upon the circumstantial evidence. See United States v.
Rahseparian, 231 F.3d 1257, 1262 (10th Cir. 2000).
1
This dissenting opinion incorporates by reference the discussion of facts, procedural
history, and legal background from Sections I.A., I.B., II.A. (except II.A.3.), II.B., and
II.C.1. from this court’s unanimous opinion in the related appeal of United States v.
Rufai, No. 12-6034.
A. Circumstantial Evidence
After careful review of the record, I believe the circumstantial evidence relevant to
the central question of Mr. Adegboye’s knowledge and intent falls into the following
categories: (1) Mr. Ohaka’s role in managing First Century and committing Medicare
fraud; (2) Mr. Adegboye’s role in setting up and maintaining First Century as a straw
owner scheme; (3) Mr. Adegboye’s role in securing Medicare billing approval; (4) Mr.
Adegboye’s role in managing First Century; and (5) Mr. Adegboye’s affidavit to
Medicare, submitted after Mr. Ohaka had been indicted for health care fraud in Texas,
omitting Mr. Ohaka’s role in First Century.2
1. Mr. Ohaka’s role at First Century
Mr. Ohaka recruited Mr. Rufai and Mr. Adegboye and directed them in setting up
the company. Testimony of First Century and Vitacare employees established that Mr.
Ohaka played the dominant role in First Century’s management, including from May
2008 to September 2008 when First Century was submitting false bills to Medicare.
Although Mr. Adegboye was present at some hiring interviews (for employees who
initially worked at Mr. Ohaka’s other DME companies and later at First Century), Mr.
Ohaka hired the employees and decided who would work at each of the DME companies,
including First Century. He decided which company would pay the employees and what
2
The majority opinion points to other evidence that it describes as evidence of a “cover
up.” For reasons I explain below, this evidence does not support conclusions about Mr.
Adegboye’s knowledge.
2
work they would do. He also monitored whether bills had been paid and whether First
Century had renewed its state permits. He received First Century’s email correspondence
from the NSC and forwarded it to Mr. Adegboye. Mr. Ohaka procured the Medicare
customers, directed the employees in filling out the Medicare paperwork, and decided
whether First Century or one of his other companies would submit the claims.
Mr. Ohaka’s DME company employees considered him to be the manager and/or owner
of First Century. Ms. Pratcher, a Vitacare and First Century employee, testified that
Messrs. Ohaka, Rufai, and Adegboye were partners in the medical supply business,
including Vitacare and First Century, with Mr. Ohaka as the senior partner. She testified
that she called Mr. Ohaka with questions or problems whenever she could not get in
touch with Mr. Rufai or Mr. Adegboye. Ms. Rinker testified that she had assumed Mr.
Ohaka was an owner of First Century, and because of this belief she told inspectors at the
March 2008 site inspection that First Century’s owner had other DME companies. She
further testified that Mr. Ohaka was her first point of contact for First Century business,
that First Century and Mr. Ohaka’s other businesses were run the same way, and that
“[t]hings were always jumbled in between the businesses.” Trial Tr. at 227.
Mr. Ohaka called the shots at First Century. Employees recognized him as the
owner and lead manager. It is reasonable to conclude that Mr. Adegboye regarded Mr.
Ohaka similarly, that he knew Mr. Ohaka controlled what happened at the company.
Without more proof, however, it does not follow Mr. Adegboye knew everything that Mr.
Ohaka did, including submission of false billing claims to Medicare.
3
2. Straw owner scheme
Mr. Adegboye’s actions to set up and maintain First Century from September 2007 until
January 2009 support a finding that he knew he was a straw owner. The Government
presented substantial evidence that Mr. Adegboye and Mr. Rufai acted as straw owners at
First Century while Mr. Ohaka managed the company behind the scenes. Mr.
Adegboye’s name was listed on all First Century legal documents: articles of
incorporation, bank accounts, service agreements, purchase agreements, leases, insurance
contracts, and Medicare application materials. Mr. Ohaka’s name did not appear on any
of these documents.
Although silent business partners are not uncommon in lawful enterprises, a jury
could conclude that the straw owner scheme established for First Century raised a red
flag to Mr. Adegboye that “something was amiss” at First Century. See United States v.
Lovern, 590 F.3d 1095, 1106 (10th Cir. 2009). But knowing that something was amiss is
not sufficient to conclude that Mr. Adegboye knew Mr. Ohaka was planning to or did
submit false bills for Medicare reimbursement. See id. (reversing conviction for
insufficient evidence).
3. Medicare billing approval
From January 2008 to May 2008, Mr. Adegboye participated in securing Medicare
billing approval for First Century. On January 8, he signed and submitted First Century’s
enrollment application materials to bill Medicare. The application warned of criminal
penalties for providing false information. It also warned that “payment of a claim by
4
Medicare is conditioned upon the claim and the underlying transaction complying with
[Medicare] laws, regulations, and program instructions” and that the Medicare provider
could not “submit claims with deliberate ignorance or reckless disregard of their truth or
falsity.” Government Trial Ex. # 1F, Aplee. Suppl. Appx. at 61. In Section 6 of the
application, Mr. Adegboye was required to list any individuals with a five percent or
greater ownership, anyone with a partnership interest, and all managing employees.
In the initial application, Mr. Adegboye listed only himself as an owner and
managing employee, which was consistent with the virtual absence of business activity at
First Century during the period of pre-Medicare approval,3 but inconsistent with Mr.
Ohaka’s assistance in setting up First Century. Mr. Adegboye attached to the application
a letter of credit signed by Mr. Ohaka. Despite a continuing duty to update the
application, he never listed Mr. Ohaka as an owner or managing employee,4 even though
a jury could reasonably infer that Mr. Adegboye knew Mr. Ohaka was managing First
Century as a Medicare reimbursement business. On the enrollment materials, Mr.
3
Ms. Raines testified that when she worked at First Century, before it was approved to
bill Medicare, First Century only sold some scrubs. Nothing in the record indicates any
other non-Medicare sales at First Century.
4
He certified that he would notify the NSC of any changes to the information in the
application within 30 days. This requirement was reinforced after the March and
September 2008 site inspections, when the NSC discovered first Ms. Rinker and later Ms.
Unsell at the store and informed Mr. Adegboye that he should list them as managing
employees. He did so as to Ms. Rinker but listed Ms. Unsell as a “delegated official,”
someone with “the authority to [make] changes and updates to the” Medicare application.
A delegated official must be listed elsewhere in the application as an owner or managing
employee.
5
Adegboye directed that all email correspondence from Medicare be sent to an email
address belonging to Mr. Ohaka, one that did not identify Mr. Ohaka as the recipient.
I address below whether Mr. Adegboye’s handling of the Medicare application is
“enough to transform the government’s weak evidence . . . into proof [of knowledge]
beyond a reasonable doubt.” United States v. Leos-Quijada, 107 F.3d 786, 795 (10th Cir.
1997) (reversing for insufficient evidence).
4. Mr. Adegboye’s role at First Century
Mr. Adegboye functioned as a straw owner and was mostly in New York and
absent from the First Century office in Oklahoma. He visited occasionally and stayed in
touch by telephone and email, but the record lacks evidence that he visited during the
time that First Century submitted the false bills to Medicare underlying the charges in the
indictment. He helped run the business by paying bills,5 responding to issues raised by
employees, and communicating with Mr. Ohaka. He also withdrew funds from the First
Century bank account for personal use. In addition to submitting application paperwork
to Medicare, he was responsible for submitting First Century’s required filings to state
authorities.6 Ms. Rinker testified that she told Mr. Adegboye that customers complained
5
Mr. Adegboye wrote checks from the First Century account for the rent of Luant,
Optimed, Providence, and Vitacare and for Ms. Rinker’s salary, as well as a check to
Harco Heating and Air for services provided to Vitacare. Although a federal agent
testified that there was no evidence First Century purchased supplies from Providence,
First Century sent $56,000 via wire transfers to an account held by Providence.
6
On May 11, 2008, Mr. Ohaka emailed Mr. Adegboye to tell him that First Century had
not submitted a renewal application required by the Oklahoma state health authority.
6
of not receiving their equipment or receiving equipment they did not order.
The Government argues that Mr. Adegboye’s First Century activities permit an
inference that he knew about health care fraud because it would be unusual not to have
such knowledge with his level of involvement. This argument goes too far. For example,
Ms. Rinker was even more involved in running Mr. Ohaka’s businesses, including First
Century, and she at most had a suspicion that Mr. Ohaka was committing health care
fraud. See Rahseparian, 231 F.3d at 1264 (noting that “suspicion is insufficient to
support an inference that [an individual] intended to join” a criminal scheme).
The majority opinion emphasizes that Mr. Adegboye was told that customers had
complained about not receiving equipment. The problem, however, is that the
Government did not present evidence that Mr. Adegboye knew anything about the
volume of complaints. All businesses receive at least some customer complaints, and
First Century was a new business that was just establishing its operations. The
Government did not show that Mr. Adegboye knew enough about the complaints to
determine they were a result of fraud instead of something more benign, such as slow or
disorganized operational processes.
5. False exculpatory statements to Medicare
First Century ceased operations in January 2009. Mr. Ohaka was indicted in July
2009. At trial the Government presented an affidavit Mr. Adegboye sent to Medicare in
September 2009 that understated Mr. Ohaka’s role at First Century.
After-the-fact statements to hide one’s involvement in illegal activity “are
7
admissible to prove circumstantially consciousness of guilt or unlawful intent.” United
States v. Davis, 437 F.3d 989, 996 (10th Cir. 2006); see also United States v. Bailey, 327
F.3d 1130, 1140 (10th Cir. 2003) (stating that “[i]ntent may be inferred from evidence
that the defendant attempted to conceal activity,” from misrepresentations, and from
knowingly making false statements). But such evidence has low probative value under
our precedent.
Our decision in Rahseparian, 231 F.3d 1257, is instructive. We reversed
defendant Jack Rahseparian’s convictions for money laundering, mail fraud, and
conspiracy to commit mail fraud because the evidence was insufficient to show criminal
intent. Id. at 1260. The case concerned Genesis Marketing, a telemarketing business
through which sons Ardie and Steve defrauded customers by failing to deliver products
and prizes to them. Id. The customers sent checks to a mailbox. Id. at 1261. Mr.
Rahseparian retrieved the checks and deposited them in three bank accounts, two
belonging to his business, and one established in his and Steve’s names. Id. He called
Ardie almost every day to ask about how many checks to expect and the dollar amount.
Id.
Although Mr. Rahseparian facilitated the fraud by accepting and depositing the
checks, and although he had frequent contact with his son, we held this was not enough to
prove intent. The Government relied primarily on false exculpatory statements Mr.
Rahseparian made to law enforcement officers when they first asked him about the
source of the deposited funds. Id. He denied knowing anything about Genesis, the
8
mailbox, and the joint bank account, and stated falsely that he cashed Genesis checks for
someone for whom he did catering events. Id.
We said there was “no evidence [Mr. Rahseparian] was aware of the
misrepresentations being made to customers, or that they were not receiving their
products or prizes.” Id. at 1263. We also said the “[f]alse exculpatory statements cannot
by themselves prove the government’s case.” Id. The statements did “clearly support an
inference that by then [he] had a suspicion of criminal activity.” Id. at 1264. “[E]ven if
[he] were suspicious of his sons’ activities at the time he was depositing their checks,
such a suspicion is insufficient to support an inference that he intended to join known
criminal activity.” Id.
In his affidavit to Medicare explaining that he had asked the FBI to return First
Century documents to him so that he could turn them over to Medicare, Mr. Adegboye
described Mr. Ohaka as a “close friend” but falsely implied Mr. Ohaka had nothing to do
with First Century. By this time, Mr. Adegboye knew that Mr. Ohaka had been indicted
in Texas for health care fraud and therefore had reason to conceal that he was in business
with Mr. Ohaka at First Century. Does this evidence show that Mr. Adegboye knew
about Mr. Ohaka’s health care fraud at First Century when it occurred? Rahseparian
teaches that false exculpatory statements made months after the alleged criminal activity
ceased have limited probative value to show such knowledge.
Although we have recognized that false exculpatory statements can be evidence of
consciousness of guilt, see United States v. Caldwell, 560 F.3d 1214, 1220 (10th Cir.
9
2009) (stating “the jury could infer Mrs. Caldwell’s guilty knowledge [of events taking
place over three years before] if they disbelieved her exculpatory testimony”); Davis, 437
F.3d at 996 (stating “false exculpatory statements [made eight days after a bank robbery
to an FBI agent investigating it]. . . are admissible to prove circumstantially
consciousness of guilt or unlawful intent”), such statements do not necessarily indicate
knowledge of criminal activity at the time it occurred. Rather, as we noted in
Rahseparian, such statements may indicate no more than an after-the-fact realization that
the declarant, unbeknownst to him, may have been involved earlier in illegal activity,
with the accompanying desire to distance himself from suspicion as much as possible.
231 F.3d at 1264. Mr. Adegboye’s affidavit misstated Mr. Ohaka’s role at First Century,
but it came almost a year after the fraudulent activity had ceased. It may show that Mr.
Adegboye knew about the Medicare fraud “by then,” id., and that he may have been
suspicious 12 months earlier, but it is not enough to support an inference of knowledge
about the fraudulent billing when it was occurring.
The majority opinion suggests that evidence in the record shows that Mr.
Adegboye made efforts to “cover up” First Century’s fraud. But apart from Mr.
Adegboye’s Medicare affidavit discussed above, the evidence the majority cites does not
demonstrate a cover up and does not go to Mr. Adegboye’s knowledge. For example,
after Medicare informed First Century that its inventory was too low, Mr. Adegboye
provided Medicare with invoices indicating that First Century had purchased inventory
from other companies, including an invoice for $115,000 from Providence, which was
10
owned by Mr. Ohaka. Mr. Adegboye wrote a check from First Century’s account in the
amount of $115,000 and deposited it directly into Providence’s account.
The majority infers from this that Mr. Adegboye was covering up First Century’s
fraud. This inference might be reasonable if Mr. Adegboye had not actually delivered the
funds to Providence, but he did so. The inference might also be reasonable if there was
evidence Mr. Adegboye knew that Providence would not ultimately deliver the inventory,
but there was no such evidence. Mr. Adegboye was in New York, and everyone agrees
he had little involvement in First Century’s operations. These facts simply do not tell us
anything about Mr. Adegboye’s knowledge of the fraud.
B. Totality of the Circumstances
“Sufficiency of the evidence determinations are made by assessing the totality of
the circumstances in the individual case.” Torres v. Mullin, 317 F.3d 1145, 1164 (10th
Cir. 2003). The Government’s evidence painted a picture of Mr. Adegboye as a mostly
absentee participant in a business for which he allowed his name to be used as a principal
but in which Mr. Ohaka was in charge and actively managed operations. A jury could
infer that Mr. Adegboye knew that (1) he was a straw owner and that Mr. Ohaka was
running First Century; (2) First Century’s business served only Medicare beneficiaries;
(3) First Century depended on Medicare reimbursements for its revenue; (4) Medicare
had found deficiencies in its operations; (5) he misrepresented the true ownership and
management of First Century to Medicare when First Century was seeking and
maintaining Medicare enrollment approval and (6) later when he submitted an affidavit to
11
Medicare after operations had ceased; and (7) customers had complained about not
receiving equipment. The Government also presented evidence that, while Mr. Ohaka
and First Century were committing Medicare fraud, Mr. Adegboye paid bills, withdrew
funds, and interacted with First Century employees, Mr. Rufai, and Mr. Ohaka.7
Of the foregoing, the Government’s case turns mostly on how Mr. Adegboye
handled the application to enroll First Century as a Medicare provider. He listed only
himself on the original application. Later he added Ms. Rinker and Ms. Unsell when
Medicare inspectors told him to do so. Even though the enrollment form called for
identification of managing employees and for updating the form, and even though Mr.
Adegboye knew that Mr. Ohaka was managing First Century, Mr. Adegboye never listed
Mr. Ohaka (Mr. Ohaka’s name did appear on an attachment to the original application).
But even if a jury could reasonably infer that Mr. Adegboye knowingly concealed Mr.
Ohaka’s identity from Medicare, could it further infer that Mr. Adegboye knew that Mr.
Ohaka was falsely billing Medicare? The issue is very close, and the needed inference
itself rests on an inference.
This is where the two key parts of the standard of review come into play. The first
7
On July 6, 2009, well after First Century’s billing privileges had been revoked and just
before Mr. Ohaka was indicted, Mr. Adegboye emailed Mr. Ohaka (copy to Mr. Rufai) a
letter from the attorneys of First Century’s landlords about debts First Century owed. Mr.
Adegboye told Mr. Ohaka that they needed to “sit down and tackle the issue like matured
[sic] and responsible adults,” or they were “only postponing the evil day.” Government
Trial Ex. # 31, Aplee. Suppl. Appx. at 586. This email may indicate that Mr. Adegboye
expected Mr. Ohaka to help with First Century’s rent, but it does little or nothing to show
that Mr. Adegboye knew of Mr. Ohaka’s fraudulent billing scheme.
12
part asks what a reasonable jury could find about Mr. Adegboye’s knowledge. A
reasonable jury could find by inference that Mr. Adegboye knowingly concealed Mr.
Ohaka’s name on the Medicare enrollment forms. From this inference and the other
evidence, a reasonable jury could suspect and also possibly infer that Mr. Adegboye
knew about Mr. Ohaka’s submitting false bills to Medicare. The second part of review
asks whether a reasonable jury could draw this second inference beyond a reasonable
doubt. An affirmative answer would establish the remaining essential element of the
aiding and abetting offense—that Mr. Adegboye knew about Mr. Ohaka’s false billing
scheme. The Government must present substantial evidence that a jury could draw this
inference from the Medicare enrollment inference. Based on review and analysis of the
record, and viewed in the light most favorable to the Government, the Government fell
short.
Adding the straw ownership scheme, customer complaints, and other evidence
does not strengthen the Medicare application evidence as a basis to infer Mr. Adegboye’s
knowledge of false billing, nor does it solve the problem that his activity in the business
lacked an evidentiary connection to the Medicare billing.8 His affidavit downplaying Mr.
Ohaka’s role in First Century may support consciousness of Medicare fraud when he
8
The customer complaint evidence is based on Ms. Rinker’s testimony, which fails to
establish the number and types of complaints, what Mr. Ohaka told Ms. Rinker to tell Mr.
Adegboye, what she actually told him, or how the complaints differed from delivery
miscues that product supply businesses typically face, especially in the starting months of
a new business. And she ultimately testified that she did not tell him about any
“particular” complaints. Trial Tr. at 226, 249-50, 308-09, 312.
13
signed it, but the affidavit statements were made after Mr. Adegboye knew about Mr.
Ohaka’s indictment for health care fraud in Texas and about one year after First Century
last billed Medicare.
This case is similar to Rahseparian. In that case, we said the government’s
evidence – that Mr. Rahseparian (1) served as the contact for the Genesis Marketing
mailbox, (2) conducted Genesis’s banking through his own personal business accounts,
thereby commingling funds and making them more difficult to trace, (3) talked daily with
his son about incoming checks, (4) purchased “lead sheets” for Genesis using a cashier’s
check rather than a business check, and (5) made false exculpatory statements to
investigators months after the alleged fraud ended – was insufficient for a reasonable jury
to find that he knew Genesis was committing telemarketing fraud.
Like Mr. Rahseparian, Mr. Adegboye made false exculpatory statements to the
government months (about a year) after the fraudulent activity had ended. The
Rahseparian court said that the false exculpatory statements alone were insufficient. I
would reach the same conclusion about Mr. Adegboye’s affidavit, which was less
incriminating than Mr. Rasheparian’s statements to investigators. As in Rahseparian, the
prosecution presented evidence in addition to Mr. Adegboye’s false exculpatory
statement. Although that evidence may have been a bit stronger than in Rahseparian –
the Medicare billing approval evidence in particular – it was, as in Rahseparian,
insufficient to infer knowledge of the alleged billing fraud beyond a reasonable doubt.
14
Mr. Ohaka recruited Mr. Adegboye and Mr. Rufai to be the front men for his fraudulent
business. It is possible that Mr. Adegboye was duped into thinking he had been given a
legitimate business opportunity and later may have suspected the business was illicit in
some way, especially after Mr. Ohaka had been indicted. On the other hand, as the
indictment alleged, he may have been aware of Mr. Ohaka’s billing scheme and First
Century’s fraudulent Medicare claims at the time of the criminal activity. But if the latter
is true, the Government did not prove it beyond a reasonable doubt, directly or
circumstantially. Mindful of the standard of review that applies to a sufficiency of the
evidence challenge, I would reverse Mr. Adegboye’s conviction for aiding and abetting
health care fraud.9
9
After arguing that the evidence was insufficient to support his conviction, Mr.
Adegboye contends that the only explanation for his aiding and abetting convictions and
his acquittal for conspiracy is that the jury was confused and mistaken on the law. This
argument appears to attempt to reinforce Mr. Adegboye’s insufficiency of the evidence
argument rather than stand as a separate issue. In particular, he argues that the jury held
him strictly liable for the actions of First Century because he was responsible for its
dealings as its owner and because he signed the Medicare applications. Because I would
hold that the evidence was insufficient, the court need not reach this argument.
15