[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
FILED
________________________ U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
No. 05-14864 MAY 11, 2007
________________________ THOMAS K. KAHN
CLERK
D. C. Docket No. 05-20144-CR-PCH
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
PURA MEDINA,
ISABEL CANEPA,
ISABEL GUERRA,
Defendants-Appellants.
________________________
Appeals from the United States District Court
for the Southern District of Florida
_________________________
(May 11, 2007)
Before TJOFLAT, FAY and SILER,* Circuit Judges.
FAY, Circuit Judge:
* Honorable Eugene E. Siler, Jr., United States Circuit Judge for the Sixth Circuit, sitting by
designation.
Defendants Pura Medina, Isabel Canepa, and Isabel Guerra (collectively
“defendants”) appeal their convictions for Conspiracy to Defraud the United States,
Commit Health Care Fraud, and to Pay Kickbacks under 18 U.S.C. § 371, Health
Care Fraud under 18 U.S.C. § 1347, Conspiracy to Commit Money Laundering under
18 U.S.C. § 1956(h), and Money Laundering under 18 U.S.C. § 1956(a)(1)(B).
Defendants argue that the government did not produce sufficient evidence to warrant
their convictions, and that the district court erred at sentencing when calculating the
amount of loss. For the reasons set out below, we vacate the convictions of Canepa
on all counts except the conspiracy to pay kickbacks count, and we find that her loss
amount was erroneously calculated at sentencing. As to Medina, we vacate her
conviction on all counts of the indictment. As to Guerra, we vacate her convictions
on the six substantive health care fraud counts involving Ocean Medical Supply that
occurred before May 4, 2001, but affirm all the remaining convictions. We also find
that her loss amount was erroneously calculated at sentencing. Accordingly, we
remand for resentencing as to Guerra and Canepa, and remand with instructions to
dismiss all counts as to Medina.
BACKGROUND
This case arises from transactions involving Ocean Medical Supply (“Ocean”)
and United Pharmacy (“United”). Guerra owned 50% stakes in both companies.1
1. Isabel Santos, Guerra’s mother, was the other 50% owner of Ocean. Santos was a co-
defendant at trial, but was acquitted pursuant to a motion under Rule 29 of the Federal Rules of
Criminal Procedure. Carlos Gonzalez was the other 50% owner at United and was convicted at
trial along with Guerra, Canepa, and Medina. However, he is not a party to this appeal.
2
Ocean dealt in Durable Medical Equipment (“DME”) such as braces and oxygen
tanks while United was a typical pharmacy that dealt in prescription drugs. Canepa
was the secretary at Ocean and Medina was the secretary/technician at United.
At trial, Rubin Martinez, another pharmacy owner, testified that before Guerra
and Gonzalez became Medicare providers through Ocean and United, they worked
as patient recruiters, bringing patients to Martinez’s pharmacy in exchange for illegal
kickbacks. However, after receiving their own provider numbers through Medicare,
Guerra and Gonzalez began taking the patients to their own businesses- Ocean and
United.
There is testimony from Wendy Evans, a Special Agent with the FBI, that
Guerra, in her capacity as part owner of both Ocean and United, signed documents
to become a Medicare provider. Among other things, these documents certified that
the Medicare provider would abide by the relevant Medicare regulations, specifically
42 CFR § 424.57. Subsection (c)(1) of this regulation provides that the supplier must
“[o]perate[] its business and furnish[] Medicare-covered items in compliance with all
applicable Federal and State licensure and regulatory requirements.” According to
Special Agent Evans’s testimony, Guerra signed these documents for Ocean on May
4, 2001, and for United on May 18, 2000.
Several witnesses testified about the schemes Ocean and United were
conducting. Nearly all the evidence presented at trial concerned kickbacks for
patients, doctors, an orthotic fitter, and patient recruiters. Kickbacks were paid to
3
entice patients to submit their medicare claims through Ocean and/or United. A
number of patient recruiters testified that they would bring patients who needed to fill
prescriptions to Ocean or United in exchange for 50% of the profits made after
submitting the claim to Medicare. The recruiter would then share their 50% with the
patient. Recruiters also testified that doctors were paid to send patients to United and
Ocean, including a Dr. Brito who worked across the hall from Ocean.
Miguel Ugarte, an orthotic fitter who measured and constructed braces for
Ocean’s customers, testified that he was paid $25 to measure each patient Ocean sent
him. He also testified that he did not actually measure many of the patients himself,
despite signing forms to that effect.
Mauricio Abanto, a government informant, testified about his interactions with
the defendants. Abanto testified that he was in the business of money laundering and
dealt with several Medicare providers, including Ocean and United. Abanto used his
advertising businesses as a cover to give the impression that any money Medicare
providers paid him was for advertising. When federal authorities confronted him, he
agreed to cooperate and videotape his money laundering transactions. Several videos
were admitted at trial that showed all three defendants meeting separately with
Abanto. During the taped encounters they would generally give him a check for
$10,800, and they would get back $10,000 in cash. Abanto would keep the remaining
$800 as a fee for cashing the checks.
4
The defendants would count the money and sometimes would discuss their
scheme. While Guerra usually dealt with Abanto on behalf of Ocean, Canepa,
Guerra’s secretary, dealt with Abanto when Guerra was unavailable. Canepa was
recorded as saying that Ocean needed the cash to pay doctors and patients with whom
they did business. Canepa also stated that patients were being paid $250 per knee
brace.
Usually Carlos Gonzalez dealt with Abanto on behalf of United. However,
there were some instances when Medina received and counted the cash delivered, and
where she wrote out checks for Abanto. However, she did not sign any of the checks
herself. In one instance, Medina was quoted as saying they “needed the money by
Tuesday.” However, on cross examination, Abanto testified that whenever Gonzalez
and he would talk about the kickback scheme, Gonzalez would send Medina out of
the room because she was just a secretary and Gonzalez didn’t want her knowing that
the cash was for paying kickbacks. The defendants were convicted on all the counts
put before the jury.2
At sentencing, after the defendants were convicted, the district court
determined that every claim United and Ocean submitted to Medicare was fraudulent,
and thus, every one of those claims that medicare paid was part of the total loss
calculated under U.S.S.G. § 2B1.1(b)(1). The district court calculated Ocean’s loss
2. Pursuant to Rule 29 Motions for Judgment of Acquittal, the district court dismissed four of
the substantive health care fraud counts as well as the “conspiracy to structure transactions”
count, brought under 18 U.S.C. § 371, before the case was sent to the jury.
5
amount to be $1,863,962.84. This loss amount was attributed to Canepa, raising her
base offense level by 16. The district court calculated United’s loss amount while
Medina was employed3 at $6,173,828, which raised her base offense level by 18.
Finally, since Guerra was involved with both Ocean and United through the entire
time period of the indictment, her loss amount was the total Medicare paid to both
businesses, $9,405,114.90. This loss amount raised Guerra’s base offense level by
20 under the sentencing guidelines.
With these loss amounts taken into account, the district court sentenced Guerra
to 99 months in prison, and Canepa and Medina to 48 months in prison.
STANDARD OF REVIEW
There are two issues before this Court:
I. Whether there was sufficient evidence of the charged offenses to sustain the
defendants’ convictions.
II. Whether the district court erred in calculating the amount of loss at sentencing.
When analyzing sufficiency of the evidence, our review is de novo, but we
must “resolve all reasonable inferences and credibility evaluations in favor of the
jury’s verdict.” United States v. Rudisill, 187 F.3d 1260, 1267 (11th Cir. 1999)
(quoting United States v. Suba, 132 F.3d 662, 671 (11th Cir. 1998) (internal quotes
omitted)). However, the evidence must be sufficient that a reasonable jury could find
3. Medina stopped working at United in December of 2002, when Carlos Gonzalez sold his
interest in United to Guerra. Any United losses calculated from December 2002 through April
2003 were attributed solely to Guerra.
6
that the government has proven guilt beyond a reasonable doubt. United States v.
Lopez-Ramirez, 68 F.3d 438, 440 (11th Cir. 1995) (citing United States v. Thomas,
8 F.3d 1552, 1555 (11th Cir. 1993)) see also Jackson v. Virginia, 443 U.S. 307, 317-
18, 99 S.Ct 2781, 2788, 61 L.Ed.2d 560 (1979).
The interpretation of the sentencing guidelines is a question of law that is
reviewed de novo. United States v. Malol, 476 F.3d 1283, 1291 (11th Cir. 2007).
However, the amount of loss determination at sentencing is reviewed for clear error.
United States v. Nostari-Shamloo, 255 F.3d 1290, 1291 (11th Cir. 2001); United
States v. Cabrera, 172 F.3d 1287, 1292 (11th Cir. 1999).
ANALYSIS
I. Sufficiency of the Evidence
A. Health Care Fraud
The government indicted the four defendants on a total of 19 counts of
substantive health care fraud under 18 U.S.C. § 1347.4 The statute provides in
pertinent part that:
Whoever knowingly and willfully executes, or attempts to execute, a scheme or
artifice -- (1) to defraud any health care benefit program; or (2) to obtain, by means
of false or fraudulent pretenses, representations, or promises, any of the money or
property owned by, or under the custody or control of, any health care benefit
program,
in connection with the delivery of or payment for health care benefits, items, or
services shall be fined under this title or imprisoned not more than 10 years, or both...
4. None of the 19 counts charged all of the defendants together. Guerra was charged in all 19
counts. Canepa was charged in 10 counts. Medina was charged in 9 counts. Isabel Santos, the
fifth defendant, was not charged in any of the health care fraud counts.
7
The district court dismissed four of the counts before the remaining 15 went to the
jury.5
When discussing what constitutes “defrauding” the United States, the Supreme
Court has stated:
To conspire to defraud the United States means primarily to cheat the government out
of property or money, but it also means to interfere with or obstruct one of its lawful
governmental functions by deceit, craft or trickery, or at least by means that are
dishonest. It is not necessary that the government shall be subjected to property or
pecuniary loss by the fraud, but only that its legitimate official action and purpose
shall be defeated by misrepresentation, chicane, or the overreaching of those charged
with carrying out the governmental intention.
Hammerschmidt v. United States, 265 U.S. 182, 188, 44 S.Ct. 511, 512, 68 L.Ed. 968
(1924). The Tenth Circuit has held, and we adopt their holding, that in a health care
fraud case, the defendant must be shown to have known that the claims submitted
were, in fact, false. United States v. Laughlin, 26 F.3d 1523, 1526 (10th Cir. 1994).
The government argues the fact that patients received kickbacks for patronizing
Ocean and United “taints” any claims the defendants made to Medicare on those
patients’ behalf. The government also argues that even if the prescriptions involved
were medically necessary, and the patient received what was prescribed, the payment
of a kickback is sufficient to establish the falsity required to defraud Medicare. In
furtherance of this argument, the government offered the testimony of Tanya Moore,
a Center for Medicare and Medicaid Services employee. Moore testified that if
5. See note 2 infra.
8
Medicare had the knowledge that a kickback had been paid to a patient or doctor, they
would not pay the claim.
We hold that based on the facts of this case, representatives of Ocean and
United paying kickbacks alone is not sufficient to establish health care fraud. While
we acknowledge that paying kickbacks like those at issue in this case is a violation
of 42 U.S.C. § 1320a-7b(b)(2)(A), we cannot hold that this conduct alone is sufficient
to establish health care fraud without someone making a knowing false or fraudulent
representation to Medicare. See United States v. Porter, 591 F.2d 1048, 1055-56 (5th
Cir. 1979) (conspiracy to commit health care fraud was weakened where alleged
kickbacks did not involve materially false statements or any money / property loss to
Medicare.)
The government argues that representatives of both Ocean and United signed
documents promising to abide by all of Medicare’s rules and regulations when they
registered to become Medicare Providers. Therefore, the government asserts that
whenever anyone on behalf of Ocean and United filed claims where patients or
doctors had received kickbacks in violation of the pertinent rules of Medicare, the
defendants committed health care fraud.
This argument is only convincing as to Guerra. Given Rubin Martinez’s
testimony, a jury could reasonably conclude that Guerra was involved in paying
kickbacks before becoming a Medicare Provider at Ocean and United. There is also
the testimony from Special Agent Evans that Guerra signed documents to become a
9
Medicare Provider stating that she would follow all applicable Medicare rules and
regulations. Indisputably, one of those rules would be to refrain from paying doctors
and patients kickbacks in violation of 42 U.S.C. § 1320a-7b(b)(2)(A). Based on
testimony that Guerra was a patient recruiter who paid patients to go to Rubin
Martinez’s pharmacy before she became a Medicare Provider, a jury could have
reasonably concluded that Guerra knew full well she would continue to pay kickbacks
when she signed the forms promising that she would not. Therefore, signing the
Medicare Provider applications would qualify as a knowing misrepresentation under
18 U.S.C. § 1347. The government presented ample evidence to show that the
kickback pattern continued after Guerra signed the forms. The record contains
testimony from several patient recruiters who were paid to bring patients to Ocean or
United through 2003. Also, the testimony of Abanto, the government informant,
could lead a reasonable jury to conclude kickbacks were still being paid. Therefore,
a reasonable jury could conclude that Guerra committed health care fraud after she
signed the applications stating that she would follow Medicare’s rules and
regulations.
Special Agent Evans testified that Guerra signed the Medicare Provider
applications for United and Ocean on May 18, 2000 and May 4, 2001, respectively.
Since these are the only knowing misrepresentations we have found upon a thorough
review of the record, it follows that any count of substantive health care fraud that
occurred before Guerra signed the company’s documents must fail. The first six
10
health care fraud counts against Ocean in the indictment occurred before May 4,
2001- when Guerra signed Ocean’s Medicare Provider application.6 Therefore, there
is simply no evidence to support the guilty verdicts as to counts 2, 4, and 7. No false
representation had been made to Medicare when the claims in those counts were
submitted. Furthermore, since no evidence was presented that either Canepa or
Medina was aware that Guerra had made these false representations to Medicare, this
evidence is not sufficient to establish fraud as to those two defendants. Laughlin, 26
F.3d at 1526.
The government attempted to prove health care fraud as to Canepa and Medina
by offering several other pieces of evidence. First, the government offered the
testimony of Dr. Hugo Goldstraj. He testified that several prescriptions made in his
name contained a forged signature and an unusually large number of refills.
However, the government did not offer any evidence that any of the defendants were
responsible for falsifying these or any other prescriptions. Nor is there any evidence
in the record that the prescriptions at issue prescribed medications or DME that the
patients did not need or did not receive. The mere fact that United or Ocean
submitted prescriptions with forged signatures to Medicare is insufficient to establish
fraud without some evidence that individuals at United or Ocean knew of the
forgeries or forged the prescriptions themselves. Therefore, Dr. Goldstraj’s testimony
6. The district court dismissed three of those counts before they were submitted to the jury.
11
is insufficient, standing alone, to establish health care fraud as to any of the
defendants.
The government also offered testimony from former patient recruiters for
Ocean and United, who stated that they were paid to bring in patients in violation of
the kickback statute. However, none of these recruiters presented any evidence that
a patient did not receive what they were prescribed, or that a patient did not need
what was delivered. Special Agent Evans testified that a few of the oxygen
concentrators that Ocean delivered were not being used. She reached this conclusion
by examining patient files that recorded the total number of hours an oxygen
concentrator was used. According to the files, one such device had only been logged
as being used for one hour over the course of a year. In another instance, the number
of total hours went down over the course of a year. To be interpreted as health care
fraud, however, there must be some evidence present in the record that shows the
patients were not legitimately prescribed the oxygen concentrators, or that Ocean
and/or United made false or fraudulent representations to Medicare on the patients’
behalf. There is no such evidence here. Taken in the light most favorable to the
government, this evidence merely establishes that Ocean’s files contained
misstatements about how much Ocean’s patients used the oxygen concentrators.
There is no evidence that this information was submitted to Medicare in any capacity.
Finally, Special Agent Evans testified that United would bill Medicare for an
aerosol medication that was manufactured out of the pharmacy, but would then give
12
the patient what is called a “compounded” medication that was mixed in the
pharmacy. According to Special Agent Evans, Medicare did not cover compounded
medication. It was also cheaper to make compounded medication than to purchase
manufactured medication. On cross examination, however, Special Agent Evans was
asked whether any specific patients were billed as receiving manufactured medication
but actually received compounded medication. She could not name a specific patient,
but rather could only state that this was a general practice at United.
Surely, the government must present some evidence that at least one specific
patient received compounded medication when United billed Medicare for
manufactured medication to prove health care fraud. A general allegation is not
sufficient. The government argues that they could not call as witnesses patients or
doctors who were paid kickbacks in violation of 42 U.S.C § 1320a-7b(b)(2)(A)
because, due to their questionable credibility, they would not make “ideal witnesses.”
This argument is unconvincing. Many of the witnesses the government presented at
trial were under indictment or had already pled guilty to similar kickback and fraud
violations, and were testifying in cooperation with the government. The fact that the
government can present these witnesses to establish kickbacks, but cannot present
paid patients or doctors to show that United and/or Ocean made false claims to
Medicare is quite contradictory and disingenuous. More importantly, it is the
government’s burden to prove every element of the charged offense beyond a
reasonable doubt. Christoffel v. United States, 338 U.S. 84, 89, 69 S.Ct. 1447, 1450,
13
93 L.Ed 1826 (1949); In re Winship, 397 U.S. 358, 364, 90 S.Ct. 1068, 1073, 25
L.Ed.2d 368 (1970). The government cannot ignore this burden simply because the
witnesses who can establish the required elements are less than ideal. Thus, the
government has not shown that either Medina or Canepa made any false or fraudulent
representations to Medicare, nor did they present evidence that Canepa or Medina
defrauded or attempted to defraud any health care program.
Therefore, we hold that Guerra’s convictions on counts 2, 4, and 7 are not
supported by sufficient evidence, but affirm her other twelve substantive health care
fraud convictions. Furthermore, we hold that there is not sufficient evidence in the
record to support the guilty verdicts as to Medina or Canepa on the charged
substantive health care fraud counts under 18 U.S.C. § 1347. (Counts 2, 4, 6, 7, 9-13,
15-20)
B. Conspiracy to Commit Money Laundering/Money Laundering
The government charged these defendants (and Carlos Gonzalez) with
Conspiracy to Commit Money Laundering under 18 U.S.C. § 1956(h), as well as
eleven counts of substantive Money Laundering under 18 U.S.C. § 1956(a)(1)(B)(i).7
For these counts to succeed, the government must prove that the proceeds were
derived from a specified unlawful activity, and that the defendant had knowledge that
the proceeds resulted from said unlawful activity. United States v. Awan, 966 F.2d
7. Carlos Gonzalez was the only defendant charged in six of the 11 substantive money
laundering counts. Guerra was charged in three of the counts, one of which charged Canepa as
well. Medina was charged with Carlos Gonzalez in two counts.
14
1415, 1434 (11th Cir. 1992); United States v. Nattier, 127 F.3d 655, 658 (8th Cir.
1997); United States v. Henry, 325 F.3d 93, 103 (2d Cir. 2003). The government
argues that the health care fraud counts charged in the indictment satisfy the money
laundering statute’s specified unlawful act requirement.
As discussed previously, there is not sufficient evidence in the record to show
that Canepa or Medina participated in or were aware of the charged health care fraud.
The government conceded that cashing the checks through their informant, Abanto,
and using the cash to pay patients illegal kickbacks was not money laundering in and
of itself, since the illegal acts occurred subsequent to the monetary exchange. As
such, health care fraud is the only specified unlawful act that could satisfy 18 U.S.C.
§ 1956. Therefore, since no evidence exists in the record to establish that Canepa or
Medina were aware of the health care fraud, we must vacate their convictions for
conspiracy to commit money laundering, as well as all the substantive money
laundering counts.
As to Guerra, since there is evidence in the record to sustain some of her
convictions for Health Care Fraud, the specified unlawful act requirement is satisfied.
Specifically, there is evidence in the record that Guerra and Carlos Gonzalez
conspired to launder money by (1) committing health care fraud, (2) cashing checks
obtained via the health care fraud through Abanto, the government informant, so that
it would appear the funds were legitimately spent on advertising, and (3) using that
cash to illegally pay kickbacks to patients and doctors.
15
Guerra was also charged in three substantive money laundering counts. These
counts occurred in October, November, and December of 2001. Since this was after
she signed the documents certifying that she would follow Medicare rules and
regulations, a reasonable jury could have concluded that Guerra was committing
health care fraud, and as such, the requisite specified unlawful activity was present.
Therefore, we hold that Guerra’s convictions for conspiracy to commit money
laundering and substantive money laundering are supported by sufficient evidence.
C. Conspiracy to (a) Defraud the United States, (b) Commit Health Care Fraud,
and (c) Pay Kickbacks
The jury convicted the defendants of violating 18 U.S.C. § 371, the multi-
objective conspiracy count.8 This Court has long held that where there is a conviction
for a multi-object conspiracy, the evidence must only be sufficient to sustain a
conviction for any one of the charged objectives. United States v. McKinley, 995
8. The Indictment charged a three-objective conspiracy as per 18 U.S.C. § 371:
(a) to defraud the United States by impairing, impeding, obstructing, and defeating, through deceitful
and dishonest means, the lawful government functions of the United States Department of Health
and Human Services in its administration and oversight of Medicare;
(b) to commit an offense against the United States, that is, to violate Title 18, United States Code,
Section 1347, by knowingly and willfully executing, and attempting to execute, a scheme and artifice
to defraud and to obtain, by means of materially false and fraudulent pretenses, representations, and
promises, money and property owned by, and under the custody and control of, a health care benefit
program, as defined in Title 18, United States Code, Section 24(b), that is, Medicare, in connection
with the delivery of and payment for health care benefits, items, and services; and
(c) to commit an offense against the United States, that is, to violate Title 42, United States Code,
Section 1320a-7b(b)(2)(A) by knowingly and willfully offering and paying remuneration (including
any kickback and bribe) directly and indirectly, overtly and covertly, in cash and in kind, to induce
the referral of Medicare beneficiaries to a person for the furnishing and arranging for the furnishing
of any item and service for which payment may be made in whole and in part by Medicare.
16
F.2d 1020, 1025 (11th Cir. 1993) (citing United States v. Johnson, 713 F.2d 633, 646
(11th Cir. 1983)).
With regard to Guerra, there is ample evidence in the record that she conspired
with Carlos Gonzalez and with Canepa, her secretary at Ocean Medical, to pay
kickbacks. There is testimony from Rubin Martinez that Guerra and Gonzalez acted
as patient recruiters before they opened United together, and before Guerra opened
Ocean. Abanto, the government informant, testified that Guerra brought him checks
signed in her name in exchange for cash. He also testified that when Guerra was
unavailable, Canepa would bring him the checks bearing Guerra’s signature. There
is testimony from other patient recruiters that Guerra paid them to bring her patients
at Ocean, and that Gonzalez paid recruiters to bring patients to United. All of this
evidence could lead a reasonable jury to conclude that Guerra conspired with
Gonzalez and / or Canepa to pay illegal kickbacks to patients in violation of 18
U.S.C. § 371.
All that is required to sustain a conviction for a multi-objective conspiracy is
sufficient evidence of one of the objects of the conspiracy. McKinley, 995 F.2d at
1025. Therefore, because there is sufficient evidence in the record to support a
conviction as to the third objective of the conspiracy, to pay illegal kickbacks, we
need not decide whether there is sufficient evidence in the record to support the other
two objectives. As such, we affirm the conspiracy conviction as to Guerra.
17
There is also sufficient evidence in the record to support Canepa’s conviction
for conspiracy to pay kickbacks. Abanto testified that Canepa would sometimes bring
him checks and collect cash on behalf of Guerra. Guerra’s signature was on the
checks Canepa brought to Abanto. Furthermore, in Abanto’s video recordings,
Canepa is seen collecting cash and informing Abanto that they need the money to pay
patients. Also in the recordings Canepa is heard saying that patients are paid $250
per knee brace. With all credibility inferences made in favor of the jury’s verdict, a
reasonable jury could have concluded that Canepa conspired with Guerra to pay
kickbacks. Because there exists sufficient evidence to convict Canepa on one
objective of the conspiracy, we need not reach the question of whether there was
sufficient evidence to convict Canepa of the other conspiracy objectives.9 McKinley,
995 F.2d at 1025. Thus, we affirm Canepa’s conviction under the multi-objective
conspiracy count.
On the other hand, there is not sufficient evidence in the record to convince a
reasonable jury that Medina is guilty of any offense in the multi-objective conspiracy
count. The only relevant evidence the government presented against Medina at trial
was Abanto’s testimony and videos. He testified that she would exchange checks for
cash when Carlos Gonzalez, her boss, was unavailable. The checks all bore
9. Also worthy of note, Canepa’s counsel at oral argument conceded that there is sufficient
evidence in the record to show Canepa was involved in paying kickbacks to patients. We
appreciate Counsel’s candor.
18
Gonzalez’s signature. The government argues that Medina made statements on the
recordings that incriminate her.
The only questionable statement Medina made that the government presented
was when she told Abanto, “We need the money by Tuesday because people are
coming.” However, when asked on cross to whom Medina was referring, Abanto
testified that she only meant her boss, Carlos Gonzalez. If we take Medina’s
statement in the light most favorable to the jury’s verdict, as our review requires, we
can infer that she also referred to patient recruiters when she said “people are
coming.” However, this evidence is still not sufficient for conviction. This statement
in no way acknowledges that she is aware that the cash is needed to pay illegal
kickbacks rather than for paying lawful United associates. Also worthy of note,
Abanto testified that Medina was not aware of the kickback conspiracy, and that
Gonzalez told her to leave the room whenever they discussed the details of the
scheme. When asked, Abanto said that Medina was “just a secretary.”
Since there is not sufficient evidence to support the guilty verdict as to Medina
of conspiracy to pay kickbacks, we must look to the other two objectives of the
conspiracy. The other two objectives of the charged conspiracy are (1) to defraud the
United States, and (2) to commit health care fraud. As discussed previously, upon a
thorough review of the record, there is no evidence that Medina had any knowledge
of any health care fraud, or participated in any scheme to defraud the U.S.
government.
19
The government argues that Medina was the technician at United who prepared
the compounded medications discussed previously. The argument is that since there
was evidence that compounded medication was given to patients when Medicare was
billed for manufactured medication, she is guilty of conspiracy to commit health care
fraud. Even if we put aside the fact that the evidence in the record is not sufficient
to sustain a conviction as to anyone for health care fraud on this ground, Medina’s
actions in preparing the compounded medication would still not be sufficient to
establish her part in a conspiracy. There is no evidence in the record that shows
Medina was preparing the compounded medication with knowledge that
manufactured medication was actually being prescribed. Thus, there is insufficient
evidence to show Medina’s knowing participation in a conspiracy to defraud the
United States or commit health care fraud. Based on this record, the government
offers no other relevant evidence as to any of Medina’s actions that would show her
participation in a conspiracy for any of the three objectives charged. Therefore, we
vacate Medina’s conviction as to the multi-objective conspiracy count.
II. Calculating the Loss
Because we vacate Medina’s conviction on all counts, we need not address the
sentencing issues on her appeal. However, since we affirm some of the convictions
as to Guerra and Canepa, we address one sentencing issue.
Canepa argues, and Guerra adopts her argument, that the district court erred
when it held that the entire amount Medicare paid out to United and Ocean from the
20
time period in the indictment, January 2000 through April 2003, was fraudulent and
thus, could be included in the loss amount at sentencing.10 The government counters
that the district court did not err, arguing that there was evidence that the vast
majority of patients were paid illegal kickbacks, and therefore, any claim submitted
on their behalf was fraudulent. Thus, any money Medicare paid out on those claims
is attributable to the loss amount.
Although the Sentencing Guidelines are now used in an advisory manner, as
per United States v. Booker, 543 U.S. 220, 125 S.Ct. 738, 160 L.Ed.2d 621 (2005),
the district court must still correctly calculate the sentencing range prescribed by the
guidelines. United States v. Crawford, 407 F.3d 1174, 1178 (11th Cir. 2005). “A
district court’s determination regarding the amount of loss for sentencing purposes
is reviewed for clear error.” United States v. Nostari-Shamloo, 255 F.3d 1290, 1291
(11th Cir. 2001); United States v. Cabrera, 172 F.3d 1287, 1292 (11th Cir. 1999).
See also U.S.S.G. § 2B1.1, comment (n.3(C)) (stating that because “[t]he sentencing
judge is in a unique position to assess the evidence and estimate the loss based upon
that evidence... the court’s loss determination is entitled to appropriate deference”)
10. This amounted to a $1,863,962.84 loss amount for Canepa and a $9,405,114.90 loss amount
for Guerra.
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(citing 18 U.S.C. § 3742(e) and (f)).11 In calculating the loss amount, “loss is the
greater of actual loss or intended loss.”12 U.S.S.G. § 2B1.1, comment (n.3(A)).
The district court needs only to make a reasonable estimate of the loss amount.
U.S.S.G. § 2B1.1(b)(1)(D), comment (n.3(C)). A reasonable estimate of the loss
amount is appropriate because “often the amount of loss caused by fraud is difficult
to determine accurately.” United States v. Miller, 188 F.3d 1312, 1317 (11th Cir.
1999). But “[w]hile estimates are permissible, courts must not speculate concerning
the existence of a fact which would permit a more severe sentence under the
guidelines. United States v. Sepulveda, 115 F.3d 882, 890 (11th Cir. 1997) (citing
United States v. Wilson, 993 F.2d 214, 218 (11th Cir. 1993)). The amount of loss
must be proven by a preponderance of the evidence, and the burden must be satisfied
with “reliable and specific evidence.” Id. (internal quotes omitted).
The government cites United States v. Cruz-Natal, 150 Fed. Appx. 961 (11th
Cir. Oct. 11, 2005), to argue that the district court did not err in its loss calculation.
Cruz-Natal, an unpublished opinion, is distinct from the instant case in that there was
no argument that the total amount the defendant attempted to recover from Medicare
was fraudulent. That case held simply that the district court did not clearly err in
finding that the intended loss was the appropriate means by which to calculate loss,
11. All citations are to the 2004 version of the Sentencing Guidelines.
12. “Actual loss” is defined as the reasonably foreseeable pecuniary harm resulting from the
offense, and “intended loss” is defined as the pecuniary harm that was intended to result from the
offense. U.S.S.G. § 2B1.1, comment (n.3(A)(i) and (ii)).
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because it was greater than the actual loss. Id. at 964. It did not hold that, as a
general matter, the total amount of all claims submitted to Medicare is an appropriate
loss calculation in Medicare fraud cases.
In the instant case, the district court made no factual findings as to the amount
of loss. When Canepa objected to the loss amount, rather than enumerating what
“reliable and specific evidence” it used to calculate the loss amount, the district court
stated “With regard to the loss amounts for which each of the defendants is to be held
accountable those are my findings. I am overruling the objections as to the amount
each defendant is to be held responsible for.” Without further information from the
district court, we cannot determine what factual basis was used to reach the
conclusion that every claim submitted to Medicare constituted loss. Indeed, upon our
review of the record, there is not sufficient evidence that any of the prescriptions
were not medically necessary, or were not delivered to the patients.
As to Guerra, the total amount billed to Medicare on the health care fraud
claims that we affirm is only $11,820. We find these claims fraudulent not because
they were based on illegitimate prescriptions, but because the patients or doctors
received kickbacks after Guerra certified to Medicare that she would not pay such
remunerations. There was no evidence presented that these claims were not medically
necessary. Even though Tanya Moore testified that Medicare would not pay a claim
if they knew parties were receiving kickbacks, this is not sufficient to establish a loss
to Medicare. Moore testified that Medicare pays out a fixed amount for every type
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of claim. Therefore, evidence that shows that United and Ocean paid kickbacks from
a fixed level of profits is not sufficient to show actual or intended loss to Medicare.
As to Canepa, since we vacate her convictions on all counts of health care fraud, she
cannot be held responsible for any loss resulting from Guerra’s fraud.
Therefore, we hold that the district court clearly erred when it did not make
specific factual findings upon which to base the loss amounts attributable to each
individual defendant.
CONCLUSION
As to Guerra, we vacate her convictions on the first three counts of health care
fraud that occurred before she signed the relevant documents which certified that she
would follow Medicare rules and regulations. We affirm her convictions on the
multi-objective conspiracy count, the 12 remaining counts of health care fraud, the
conspiracy to commit money laundering, and the substantive money laundering
counts.
As to Canepa, we vacate her convictions on all health care fraud counts, the
conspiracy to commit money laundering count, and all substantive money laundering
counts. We affirm, however, her conviction on the multi-objective conspiracy count.
The sentences imposed upon Guerra and Canepa are vacated and their cases are
remanded to the district court for resentencing.
As to Medina, we vacate her convictions and sentences on all counts in the
indictment, and remand to the district court with instructions to dismiss the charges.
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CONVICTIONS AFFIRMED IN PART AND REVERSED IN PART AS TO
GUERRA AND CANEPA; SENTENCES VACATED AND THE CASE
REMANDED FOR RESENTENCING AS TO GUERRA AND CANEPA;
CONVICTIONS REVERSED AND SENTENCES VACATED AS TO MEDINA.
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