United States v. Booker

679 F.Supp.3d 453

UNITED STATES of America, v. Donald BOOKER, Defendant.

CRIMINAL ACTION NO. 3:22-CR-00034-KDB-SCR

United States District Court, W.D. North Carolina, Charlotte Division

Signed June 27, 2023

Graham R. Billings, Benjamin Bain-Creed, Assistant U.S. Attorneys, Michael E. Savage, United States Attorney's Office, Charlotte, NC, for United States of America.

W. Rob Heroy, Charlotte, NC, for Defendant.

ORDER

Kenneth D. Bell, United States District Judge

THIS MATTER IS BEFORE THE COURT on the Defendant's Motion for a Judgment of Acquittal under Rule 29 of the Federal Rules of Criminal Procedure. (Doc. No. 109). The Defendant also seeks to set aside the jury verdicts under Rule 33. Id. The Court has reviewed the Motion, the parties' briefs and exhibits, and other relevant pleadings of record. For the reasons discussed below, the Court will deny the Motion.

I. BACKGROUND

On February 15, 2022, the Defendant was indicted and charged with 1) conspiracy to defraud the United States, in violation of 18 U.S.C. § 371; 2) multiple violations of the Anti-Kickback Statute, in violation of 42 U.S.C. § 1320a-7b; 3) conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h); and 4) money laundering, in violation of 18 U.S.C. § 1956(a)(1)(B)(i). See Doc. No. 1. The United States filed a Superseding Indictment on December 14, 2022, which removed unnecessary allegations, narrowed the temporal scope of the charges, and identified a previously unnamed coconspirator. See Doc. No. 52. The nature of the charges against the Defendant did not change. Id. After a six-day trial beginning on January 3, 2023, in which the Defendant represented himself, the jury returned a guilty verdict on all counts. The Defendant, through counsel, seeks a judgment of acquittal and to set aside the jury verdicts. The matter is now ripe for the Court's consideration.

II. LEGAL STANDARD

Rule 29 of the Federal Rules of Criminal Procedure states that "[a]fter the government closes its evidence or after the close of all the evidence, the court on the defendant's motion must enter a judgment of acquittal of any offense for which the evidence is insufficient to sustain a conviction." Fed. R. Crim. P. 29(a). "A defendant may move for a judgment of acquittal . . . within 14 days after a guilty verdict or after the court discharges the jury, whichever is later." Id. "If the jury has returned a guilty verdict, the court may set aside the verdict and enter an acquittal." Id.

"A judgment of acquittal based on the insufficiency of evidence is a ruling by the court that as a matter of law the government's evidence is insufficient 'to establish factual guilt' on the charges in the indictment." United States v. Alvarez, 351 F.3d 126, 129 (4th Cir. 2003) (quoting Smalis v. Pennsylvania, 476 U.S. 140, 144, 106 S. Ct. 1745, 90 L. Ed. 2d 116 (1986)). "The test for deciding a motion for a judgment of acquittal is whether there is substantial evidence (direct or circumstantial) which, taken in the light most favorable to the prosecution, would warrant a jury finding that the defendant was guilty beyond a reasonable doubt." United States v. MacCloskey, 682 F.2d 468, 473 (4th Cir. 1982); see also United States v. Rafiekian, 68 F.4th 177 (4th Cir. 2023). "[I]n the context of a criminal action, substantial evidence is evidence that a reasonable finder of fact could accept as adequate and sufficient to support a conclusion of a defendant's guilt beyond a reasonable doubt." United States v. Burgos, 94 F.3d 849, 862 (4th Cir. 1996). Moreover, the jury, not the reviewing court, assesses the credibility of the witnesses and resolves any conflicts in the evidence presented. United States v. Wilson, 118 F.3d 228, 234 (4th Cir. 1997). Consequently, a court must deny a defendant's Rule 29 motion and accept the jury's verdict if, "after viewing the evidence in the light most favorable to the government, any rational trier of fact could have found the elements of the offense beyond a reasonable doubt." United States v. United Med. & Surgical Supply Corp., 989 F.2d 1390, 1402 (4th Cir. 1993) (citing Jackson v. Virginia, 443 U.S. 307, 319, 99 S. Ct. 2781, 61 L. Ed. 2d 560 (1979)).

Rule 33 of the Federal Rules of Criminal Procedure provides that "the court may vacate any judgment and grant a new trial if the interest of justice so requires." Fed. R. Crim. P. 33(a); see also Rafiekian, 68 F.4th 177, 186 ("[a] district court may order a new trial on the defendant's motion 'if the interest of justice so requires.' "). A district court "should exercise its discretion to grant a new trial sparingly," and "should do so only when the evidence weighs heavily against the verdict," United States v. Perry, 335 F.3d 316, 320 (4th Cir. 2003) (citation omitted), or when substantial prejudice has occurred, United States v. Jones, 542 F.2d 186, 211 (4th Cir. 1976). Merely believing that the case could have come out the other way is not enough to warrant a new trial. Rafiekian, 68 F.4th 177, 186. Because determining witness credibility and weighing conflicting evidence are the responsibility of the jury, the standard for forsaking a jury verdict in favor of a new trial is demanding. Id.; United States v. Millender, 970 F.3d 523, 532 (4th Cir. 2020).

III. DISCUSSION

The Defendant makes several arguments in support of his Motion. The Defendant argues that: (1) the United States' money laundering theory violates the Merger Doctrine; (2) the money laundering conspiracy count failed to allege a criminal offense; (3) the introduction of a redacted portion of the administrative law judge's order violated the Confrontation Clause and the Federal Rules of Evidence; (4) the Safe Harbor Provision of the Anti-Kickback Statute violates the Nondelegation Doctrine; (5) the Court wrongly denied the Defendant the opportunity to recross Richard Graves; and (6) the Court wrongly denied the Defendant's Motion for a continuance. The Court will address each argument in turn.

1) Merger Doctrine

The Defendant first argues that the United States' money laundering theory violates the merger doctrine under United States v. Santos. Specifically, he contends that the United States alleged "a theory of concealment money laundering such that the money laundering is part and parcel of the health care fraud." The United States responds that: (1) the merger doctrine does not apply; and (2) even if the merger doctrine applies, no merger occurred.

In Santos, the Supreme Court considered whether the term "proceeds" meant "receipts" or "profits." See United States v. Santos, 553 U.S. 507, 128 S. Ct. 2020, 170 L. Ed. 2d 912 (2008) (plurality opinion). Santos was convicted of operating an illegal gambling business and of laundering the proceeds of that business. The district court vacated Santos's money laundering convictions under § 1956(a)(1)(A)(i) and § 1956(h), finding that "the proceeds admittedly used by Santos to pay winners and couriers could only have been gross proceeds," rather than net proceeds. See United States v. Santos, 342 F.Supp.2d 781, 799 (N.D. Ind. 2004), aff'd, 461 F.3d 886 (7th Cir. 2006). The Supreme Court affirmed in a 4-1-4 decision. Justice Scalia, writing for the plurality, explained, if "proceeds" meant "gross receipts," "nearly every violation of the illegal-lottery statute would also be a violation of the money-laundering statute, because paying a winning bettor is a transaction involving receipts that the defendant intends to promote the carrying on of the lottery." Santos, 553 U.S. at 515, 128 S.Ct. 2020 (plurality opinion). "Since few lotteries, if any, will not pay their winners, the statute criminalizing illegal lotteries, 18 U.S.C. § 1955, would 'merge' with the money-laundering statute." Id. at 515-16, 128 S.Ct. 2020. Justice Scalia added that:

For a host of predicate crimes, merger would depend on the manner and timing of payment for the expenses associated with the commission of the crime. Few crimes are entirely free of cost, and costs are not always paid in advance. Anyone who pays for the costs of a crime with its proceeds—for example, the felon who uses the stolen money to pay for the rented getaway car—would violate the money-laundering statute. And any wealth-acquiring crime with multiple participants would become money laundering when the initial recipient of the wealth gives his confederates their shares. Generally speaking, any specified unlawful activity, an episode of which includes transactions which are not elements of the offense and in which a participant passes receipts on to someone else, would merge with money laundering.

Id. at 516, 128 S.Ct. 2020 (footnote omitted). Justice Stevens agreed, asserting that "[a]llowing the Government to treat the mere payment of the expense of operating an illegal gambling business as a separate offense is in practical effect tantamount to double jeopardy." Id. at 527, 128 S.Ct. 2020 (Stevens, J., concurring)

In light of Santos, the Fourth Circuit has held when illegal activity includes money transactions to pay for the costs of the illegal activity, a merger problem can occur if the United States uses those transactions to prosecute a defendant for money laundering. See United States v. Halstead, 634 F.3d 270, 279 (4th Cir. 2011). Put another way, a defendant cannot be convicted of money laundering for paying the "essential expenses of operating the underlying crime." United States v. Cloud, 680 F.3d 396, 406 (4th Cir. 2012) (citing Halstead at 279, (internal citation omitted)). At the same time, when the transactions of the predicate offense are different from the transactions prosecuted as money laundering, a merger problem does not arise. Halstead, 634 F.3d at 279-280.

Here, no merger of offenses took place. The Defendant conspired to commit health care fraud when he submitted or caused to be submitted false claims to Medicaid for urine drug tests that were medically unnecessary and procured through promises of illegal remuneration. The...