United States v. Sorensen

684 F.Supp.3d 784

UNITED STATES of America v. Mark SORENSEN

No. 19-cr-00745-1

United States District Court, N.D. Illinois, Eastern Division

Signed July 31, 2023

Leslie Salba Garthwaite, Assistant U.S. Attorney, Criminal Division-Fraud Section, Trial Attorney, Chicago, IL, AUSA, Assistant U.S. Attorney, United States Attorney's Office, Chicago, IL, Daniel Griffin, Victor B. Yanz, Department of Justice, Chicago, IL, Pretrial Services, Probation Department, for United States of America.

Todd S. Pugh, Chelsy Lynn Van Overmeiren, Christopher Dallas, Thomas Michael Breen, Breen & Pugh, Chicago, IL, Robert W. Stanley, Chicago, IL, for Mark Sorensen.

MEMORANDUM OPINION AND ORDER

Franklin U. Valderrama, United States District Judge

A jury found Defendant Mark Sorensen (Sorensen) guilty of one count of conspiracy and three counts of offering and paying bribes or kickbacks in return for the referral of patients to SyMed, a durable medical equipment distributor owned by Sorensen. Sorensen now moves for a judgment of acquittal under Federal Rule of Criminal Procedure 29(c) or, in the alternative, for a new trial under Rule 33. R. 200, Def.'s Mot.¹ Additionally, after the Government rested at trial, Sorensen orally moved for judgment of acquittal under Rule 29(a), which the Court took under advisement pursuant to Rule 29(b). R. 187. Sorensen subsequently filed a written motion for judgment of acquittal. R. 196. For the reasons explained below, the Court denies Sorensen's Motions.

Background

Sorensen is the president and owner of SyMed, a durable medical equipment distributor that had a contract with Medicare. Tr. 461, 754, 766. At trial, the Government produced evidence that, in or around January 2015, Sorensen met with Bernard Perconti (Perconti), Tim Size, and Dianne Chancellor, among several other people (all in-person), as well as Christie Anderson (Anderson) (via phone), during which they discussed establishing a business arrangement to advertise and sell medical braces, which would be billed to Medicare. Tr. 766-68. Perconti testified that the business model had multiple steps: (1) advertisements for braces, mostly online; (2) potential patients providing their contact information via the ads, which would be routed to a call center; (3) an intake sales call with an agent to discuss the potential patient's need for a brace; (4) creation of a long form lead if the potential patient wanted a brace; (5) the information collected would be input on a prescription document and faxed to the patient's physician (known as the chase process); (6) the doctor would sign (or not) the prescription and return it to Dynamic Medical Management (Dynamic Medical), owned by Stephanie Chancellor, and to SyMed for review; (7) Pakmed, the company owned by Perconti, would ship the brace to the patient, after which SyMed would bill Medicare. Id. 769-771, 810; see also GX Demonstrative 1; GX 2012; DX 6. Perconti testified that they began the steps in the aforementioned process in early 2015 and continued through early 2018. Tr. 788. Two companies, KP Network (KPN) owned by Craig O'Neil (O'Neil), and Byte Success, owned by Anderson, generated leads, meaning that they handled patient marketing and the provision of signed doctor's orders for the braces. Tr. 764, 776, 779, 807, 1051, 1057-62. Dynamic Medical provided third-party billing services for SyMed. Tr. 810-11.

In June 2015, SyMed and Pakmed entered into a billing services agreement, effective as of April 1, 2015. Tr. 795-96; GX 2030. The terms of the contract reflected that SyMed would pay Pakmed 79% of the collection from Medicare or other insurance, and SyMed would keep 21% as a service fee. Id. 790; GX 2030, GX 2033. KPN and Byte Success were also paid a percentage of the total amount collected by Medicare depending on the number of leads that they generated. Tr. 805-10, 1062-63. Dynamic Medical also received a percentage of the total. Id. 810-11.

In August 2016, Perconti and Sorensen met in Chicago, where Perconti told Sorensen that their existing arrangement was "not good" and they needed to make some changes. Tr. 838-39. Perconti provided Sorensen with a new draft contract, which included an hourly fee schedule. Tr. 840-43; GX 2196. Sorensen suggested some edits to the second contract, and after those were incorporated, Sorensen signed the second contract on behalf of SyMed on August 24, 2016 and Perconti signed it on behalf of Pakmed in January 2017. Tr. 851-855; GX 2216, GX 2220. Although the contract provided for a new fee structure, that is, an hourly fee structure, in fact nothing changed and Pakmed and SyMed continued their 79/21 percentage fee structure. Id. 856-7; GX 2202, GX 2246, GX 2274.

In March 2017, Polina Goncharova (SyMed's Vice President of Finance and Operations and Sorensen's co-defendant) emailed Perconti, copying Sorensen, requesting invoices for the past 12 months of services from Pakmed to SyMed. Tr. 468-69, 861-71; GX 2246, GX 2251. Perconti created invoices based on a formula provided by Goncharova, which would equal the 79/21 breakdown for payment between Pakmed and SyMed. Tr. 858-75; GX 2246, GX 2246-1, GX 106, GX 107, GX 120. Perconti testified that Pakmed tapered off and eventually stopped selling leads to SyMed in 2018, despite pushback from Sorensen and Goncharova. Tr. 927-29, 985, 1062.

As part of the Government's investigation, Sorensen was interviewed by Special Agents Peter Theiler and Ed Leitel from the Department of Health and Human Services on July 31, 2019. Tr. 666; GX 320, GX 351.

On September 24, 2019, the Government charged Sorensen in a four-count indictment with one count of conspiracy and three counts of offering and paying bribes or kickbacks in return for the referral of patients to SyMed, a durable medical equipment distributor owned by Sorensen. R. 1, Indictment. Specifically, Count One of the indictment charged Sorensen and Goncharova (together, Defendants), beginning no later than in or around January 2015, and continuing through at least in or around April 2018, with conspiring to knowingly and willfully offer and pay any remuneration, including kickbacks and bribes, for the furnishing of services for which payment may be made in whole or in part under a federal health care program in violation of 42 U.S.C. § 1320a-7b(b)(2)(A) (the Anti-Kickback Statute). Id. Counts Two, Three, and Four charged Defendants with substantive violations of the Anti-Kickback Statute, that is, with knowingly and willfully causing SyMed to offer and pay remunerations in the amounts of $49,794, $300,000, and $56,767 on or about November 20, 2015, April 6, 2017, and February 12, 2018, respectively, for the furnishing of services for which payment may be made in whole or in part under a federal health care program. Id.

Sorensen and Goncharova pled not guilty to all counts, and proceeded to a seven-day jury trial. R. 7, 18, 179-82, R. 187, R. 190-91. During the trial, the Government called the following witnesses: Stephen Quindoza, Jose Ruiz, David Kiesow, Carmen Gomez (Agent Gomez), Bernard Perconti, and Craig O'Neil. The Government did not call Christina Anderson or Agent Peter Theiler (Agent Theiler). Neither Sorensen nor Goncharova called any witnesses.

On January 19, 2023, the jury returned a verdict of guilty against Sorensen on all counts of the Indictment. R. 192. The jury returned a verdict of not guilty against Goncharova on all counts. R. 194. Sorensen now moves for a judgment of acquittal or a new trial on all counts, pursuant to Federal Rules of Criminal Procedure 29 and 33, respectively. Def.'s Mot.

Legal Standards

I. Rule 29

Under Rule 29(c), a defendant may move for a judgment of acquittal after a guilty verdict, and "[i]f the jury has returned a guilty verdict, the court may set aside the verdict and enter an acquittal." Fed. R. Crim. P. 29(c)(2). Rule 29(a) further instructs that, "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 seeking acquittal, however, faces "a nearly insurmountable hurdle." United States v. Garcia, 919 F.3d 489, 496 (7th Cir. 2019) (cleaned up).² The height of the hurdle "depends directly on the strength of the government's evidence." United States v. Kelerchian, 937 F.3d 895, 907 (7th Cir. 2019) (cleaned up). To prevail on a motion for acquittal, a defendant "must show that when viewing all the evidence in the light most favorable to the government, no rational jury could have found the essential elements of the offenses beyond a reasonable doubt." United States v. Ghilarducci, 480 F.3d 542, 546 (7th Cir. 2007) (cleaned up). "In doing so, the court 'draw[s] all reasonable inferences in' the government's favor." United States v. Hidalgo-Sanchez, 29 F.4th 915, 924 (7th Cir. 2022) (cleaned up). Accordingly, a court only overturns a conviction if, after reviewing the record in the light most favorable to the Government, it concludes "that no rational trier of fact could have found the essential elements of the offense beyond a reasonable doubt." Id. (cleaned up). A verdict must stand if the record offers a reasonable basis for it. Id. (cleaned up). In addition, a court defers to the jury's deliberations and respects "the exclusive function of the jury to determine the credibility of witnesses, resolve evidentiary conflicts, and draw reasonable inferences." United States v. Godinez, 7 F.4th 628, 638-39 (7th Cir. 2021) (cleaned up).

If a court enters a judgment of acquittal after a guilty verdict, Rule 29(d) requires the court to "conditionally determine whether any motion for a new trial should be granted if the judgment of acquittal is later vacated or reversed." Fed. R. Crim. P. 29(d)(1).

II. Rule 33

Rule 33 permits a court to "vacate any judgment and grant a new trial if the interest of justice so requires." Fed. R. Crim. P. 33(a). A new trial is warranted "only if there is a reasonable...