United States v. Holden, No. 13-30308 (Gould with Hawkins and Ikuta) --- The Ninth Circuit affirmed a conviction for health-care fraud under 18 U.S.C. § 1347, rejecting a challenge based on the statute of limitations and three challenges to the sufficiency of the indictment.
The defendant is a doctor who took patients covered by government health-insurance programs. He was first charged in a 59-count indictment with 56 counts of health-care fraud under § 1347 and 3 counts of false statements relating to health care, in violation of 18 U.S.C. § 1035. He moved to dismiss counts 41-56, which alleged 17 discrete § 1347 violations based on specific alleged fraudulent bills, as outside the statute of limitations. The district court agreed as to all of them except count 42, which had been shown to be within the limitations period.
Then the government filed a superseding indictment in which it consolidated all of the dismissed counts into a new Count 41, which alleged a scheme to defraud that began outside the limitations period but continued well into the limitations period. The defendant renewed his statute-of-limitations challenge to this new Count 41, arguing that it did not relate back to the date of the original indictment because it substantially broadened the scope of conduct alleged. The district court ruled that the superseding indictment was valid because the defendant all along had had notice of those charges and the new Count 41 did not broaden the charges, such that the limitations period was tolled. After a seven-day trial, the jury returned guilty verdicts on 32 counts.
Because new Count 41 alleged a single fraudulent scheme that continued into the limitations period, and § 1347 health-care fraud is a continuing offense, Count 41 was not barred by the statute of limitations. Importantly, the defendant's last fraudulent claim was alleged to have been submitted within the limitations period. Moreover, the superseding indictment did not broaden the charges with respect to the first indictment; lumping discrete acts of fraud into a continuing scheme was permitted, and the defendant always had notice of what crimes the government alleged against the defendant. The superseding indictment stated a valid federal crime, and did not impermissibly vary from the language returned by the original grand jury.
The decision is here: