Commonwealth v. Hyde

88 Mass.App.Ct. 761

42 N.E.3d 1171

COMMONWEALTH

v.James C. HYDE (and seven companion cases¹ ).

No. 12–P–867.

Appeals Court of Massachusetts, Essex.

Argued June 12, 2015.

Decided Dec. 21, 2015.

Edward Foye (David Meier with him), Boston, for James C. Hyde.

Sarah E. Dolven for Omar Castillo.

Argie K. Shapiro, Assistant Attorney General (William R. Freeman, Special Assistant Attorney General, with her) for the Commonwealth.

Present: COHEN, GREEN, & TRAINOR, JJ.

Opinion

COHEN, J.

Following a multi-year inquiry by investigators from the Massachusetts Insurance Fraud Bureau and the city of Lawrence police department, a grand jury indicted the defendants, James C. Hyde, Michael H. Kaplan, and Omar Castillo, for crimes arising from the submission of fraudulent automobile insurance claims.² The defendants later were tried together before a Superior Court jury. Hyde, an attorney at the law firm of Berger & Hyde, P.C., was convicted of two counts each of motor vehicle insurance fraud (see G.L. c. 266, § 111B ), larceny over $250 (see G.L. c. 266, § 30 ), and attempted larceny over $250 (see G.L. c. 274, § 6 ). Kaplan, a chiropractor and owner of the Kaplan Chiropractic clinic, was convicted of three counts of motor vehicle insurance fraud, and two counts each of larceny over $250 and attempted larceny. Castillo, an employee of Kaplan Chiropractic, was convicted of one count each of motor vehicle insurance fraud and larceny over $250. Before us are the appeals of Hyde and Castillo.³

Hyde's convictions resulted from insurance claims submitted on behalf of clients purporting to have been injured in two staged automobile accidents—one alleged to have occurred on October 1, 2002, and the other alleged to have occurred on December 20, 2002. Hyde's primary contention on appeal is that the Commonwealth failed to establish at both the grand jury and petit jury stages of the case that he knew that these particular accidents were staged. On this ground, he maintains that both his pretrial motion to dismiss the indictments and his motion for required findings of not guilty at trial should have been allowed. In addition,

Hyde argues that the indictments should have been dismissed for the additional reason that the integrity of the grand jury proceedings was impaired, and that he is entitled to a new trial as a result of the erroneous admission of prior bad act evidence.

Castillo's convictions resulted from his role in helping to stage the December 20 accident. Castillo argues that there was insufficient evidence that he knew that statements submitted to insurance companies with regard to that accident were false, and, therefore, his motion for required findings of not guilty should have been allowed. Castillo also argues that he is entitled to a new trial as a result of the erroneous admission of checks written to him by Berger & Hyde, P.C. For the following reasons, we affirm both defendants' convictions.

Background. The jury could have found the following facts. In 2000, Leo Lopez began to work as an assistant and van driver at Kaplan Chiropractic. Shortly after starting the job, Lopez brought his mother to Kaplan Chiropractic for treatment of a work-related shoulder injury. When Kaplan gave him $100 in cash for bringing his mother in, Lopez learned that it was Kaplan's policy to pay his employees cash bonuses when they referred new patients to the clinic. Kaplan later told Lopez that he could make extra money by setting up motor vehicle accidents. Kaplan explained how to stage an accident by obtaining two cars (one to play the “at fault” role, and the other to play the “not at fault” role), recruiting a driver and passengers for each car, crashing the cars together, preparing accident reports, and bringing the accident participants first to a chiropractor and then to an attorney.

On December 5, 2000, Lopez staged his first accident. He drove his own car, which he was eager to replace, and arranged for a woman to hit it with her minivan. The next day, he went to Kaplan for treatment. At Kaplan's recommendation, Lopez promptly went to see Hyde at his law firm. At that meeting, Hyde explained that Lopez would need to accumulate $2,000 in medical bills to have a case,⁴ and gave him an envelope containing a check for $200 for bringing the matter to the firm. Hyde also promised to “take care of [him]” if he referred more clients.

To build up his medical expenses, Lopez went to a few actual physical therapy sessions at Kaplan Chiropractic, and then pretended

to receive further treatment. Lopez also went back to Hyde's office to fill out a personal injury protection form to obtain no-fault benefits for alleged lost wages,⁵ even though he had not stopped working. Hyde eventually settled Lopez's case for $5,300, from which Hyde took $1,325.

Lopez testified in some detail about the period between December, 2000, through September, 2002. At first, he staged “live” two-car collisions, where police and other emergency responders would be called to the scene. However, by mid–2001, he had transitioned to staging “paper” accidents. In those instances, he would obtain and damage two cars, recruit people willing to pose as the occupants, and fill out paperwork as if a real accident had occurred. The day after each purported accident, the persons pretending to be the injured occupants would be taken to one of two chiropractors and one of two lawyers, based on whether they were the designated occupants of the “at fault” vehicle or the “not at fault” vehicle. The chiropractor was either Kaplan or another chiropractor who practiced at Haverhill Family Chiropractic, and the lawyer was either Hyde or another lawyer who practiced at a different firm.⁶

Castillo, another van driver for Kaplan, also was engaged in the scheme. He staged accidents, brought the participants to Kaplan for treatment, and obtained payments from Kaplan in return. Castillo, too, was introduced to Hyde, and received referral fees from Hyde when he brought Hyde new clients.

Lopez's reputation grew to the point where members of the community would approach him to volunteer their participation. He enlisted the help of a friend, Christopher Ortega, and paid him a share of the referral fees. The two would recruit participants, coach them on their roles in the fictitious accidents, and tell them how to respond to medical, legal, and insurance professionals. From December, 2000, through September, 2002, Lopez referred participants in more than twenty staged accidents to Kaplan Chiropractic or Haverhill Family Chiropractic, and to Hyde or the other lawyer involved in these ruses. Both Kaplan and Hyde would pay Lopez for each individual whom he referred to their respective practices.

As Lopez became friendly with Hyde, the two had a number of private conversations where Hyde made specific suggestions

about how best to stage the accidents. For example, Hyde told Lopez that there were three insurance companies to be avoided, because they were “really going hard investigating the accidents.” On four or five occasions, Hyde told Lopez to keep the number of people in a vehicle to no more than three. Ortega testified to similar conversations with Hyde in which Hyde explained that too many passengers “would bring up red flags” with the insurance companies. On the other hand, Lopez also understood from discussions with Kaplan, that if there were too few passengers, there would not be enough money. Sometimes Hyde would tell Lopez that he should “coach” a nervous client “better,” in case the insurance company sent out an investigator to ask the client questions. Hyde explained that if the client gave a statement that was inconsistent with the accident report, it would raise suspicions, and no one would get paid.

Lopez testified that on more than one occasion in the period from December, 2000, through September, 2002, he told Hyde that the clients he was referring were from staged accidents. However, Lopez and Ortega also testified that sometimes the accident victims they referred were legitimate. Ortega estimated that “20 percent [were] real and the rest [were] fake.”

The October 1, 2002, and December 20, 2002, staged accidents were both paper accidents. The premise of the October 1 accident was that a Jaguar driven by Antonia Almanzer and carrying two passengers, was struck in the rear by a Ford Explorer driven by Kelly Birchall and carrying four passengers. Birchall was the godmother of Lopez's son, and had agreed “to take the fall.” The accident was orchestrated by Lopez and Ortega, who damaged the Explorer by driving it into a wall. The Explorer actually was owned by one of the ostensible passengers, who was paid $500 for its use as the “at fault” vehicle.

Lopez filled out the operator's report for the purported driver of the Explorer, supplying information about the two vehicles, the names and personal data of the occupants, and a description of the accident, including the time, date, and location of the collision. Lopez, along with Ortega, also brought the Explorer passengers to Haverhill Chiropractic and then to Hyde's law firm. At the law firm, the passengers met as a group with Miguel Nieves, Hyde's associate. They never met Hyde, personally. Medical bills were generated, and Hyde submitted claims on behalf of the passengers. As a result, the insurer paid more than $250 in medical payments to Haverhill Chiropractic on behalf of one or more

claimants. By check dated October 1, 2002, Lopez received a check for $1,000 from Hyde for having referred these clients to him.

Accompanied by Nieves, the clients later were examined under oath by the insurer. Subsequently, on August 28, 2003, the insurer denied the claims in a letter to Hyde stating that its investigation revealed that the “accident was not of a direct or accidental nature.” The letter explained that the examinations under oath “yielded vague and inconsistent testimony, especially in regards to what happened before and after the loss”; there were no...