US v. Amir A. Bajoghli
Filing
PUBLISHED AUTHORED OPINION filed. Originating case number: 1:14-cr-00278-GBL-1. [999580757]. [14-4798]
Appeal: 14-4798
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PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 14-4798
UNITED STATES OF AMERICA,
Plaintiff - Appellant.
v.
AMIR A. BAJOGHLI,
Defendant - Appellee.
Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria. Gerald Bruce Lee, District
Judge. (1:14-cr-00278-GBL-1)
Argued:
March 25, 2015
Decided:
May 11, 2015
Before NIEMEYER and FLOYD, Circuit Judges, and HAMILTON, Senior
Circuit Judge.
Reversed and remanded by published opinion.
Judge Niemeyer
wrote the opinion, in which Judge Floyd and Senior Judge
Hamilton joined.
ARGUED: Paul Nathanson, OFFICE OF THE UNITED STATES ATTORNEY,
Alexandria, Virginia, for Appellant.
Peter Hugh White, SCHULTE
ROTH & ZABEL LLP, Washington, D.C., for Appellee.
ON BRIEF:
Dana J. Boente, United States Attorney, Matthew Burke, Assistant
United States Attorney, Katherine L. Wong, Assistant United
States
Attorney,
OFFICE
OF
THE
UNITED
STATES
ATTORNEY,
Alexandria, Virginia, for Appellant.
Joe Robert Caldwell, Jr.,
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BAKER BOTTS LLP, Washington, D.C.; Kirk Ogrosky, Murad Hussain,
ARNOLD & PORTER LLP, Washington, D.C., for Appellee.
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NIEMEYER, Circuit Judge:
Dr.
Amir
Bajoghli,
a
board-certified
dermatologist,
was
indicted for executing a “scheme or artifice to defraud” when
billing public and private healthcare benefit programs during
the period from January 2009 through August 2012, in violation
of 18 U.S.C. § 1347, and for related offenses.
The indictment
set forth, in 53 of its 60 counts, particular “executions” of
the fraudulent scheme.
On September 30, 2014, several weeks before the scheduled
trial
date
of
October 22,
2014,
Bajoghli
filed
a
motion
to
strike as unduly prejudicial certain financial details alleged
in Paragraph 50 of the indictment; on October 13, he filed a
motion in limine to exclude evidence of post-scheme conduct that
the government intended to introduce to show his consciousness
of guilt; and on October 20, he filed a motion in limine to
exclude all evidence of the scheme that was not directly related
to one of the 53 specifically charged executions.
court
granted
all
three
motions,
the
latter
before the trial was scheduled to begin.
government
filed
this
interlocutory
two
The district
on
the
day
On the same day, the
appeal,
pursuant
to
18
U.S.C. § 3731, challenging the rulings.
Because
unduly
we
restricted
conclude
the
that
the
latitude
district
reasonably
court’s
necessary
rulings
for
the
government to carry its burden of proof, we reverse and remand.
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I
Bajoghli is the owner of the Skin and Laser Surgery Center,
a medical practice that operates from three offices in Virginia
and
one
in
diseases
Washington,
and
According
the
to
D.C.,
and
performance
the
of
indictment,
that
Mohs
Mohs
specializes
in
micrographic
surgery
is
skin
surgery.
a
“highly
lucrative,” “specialized surgical technique for the removal of
skin cancer from healthy skin” that is “generally performed on
sensitive areas of the body, such as the head and neck, where
preservation
of
healthy
tissue
and
cosmetic
appearance
are
particularly important.”
On
August
12,
2014,
the
grand
jury
returned
a
60-count
indictment against Bajoghli, charging: 53 counts of healthcare
fraud, in violation of 18 U.S.C. § 1347; 6 counts of aggravated
identity
theft
defraud,
in
committed
violation
in
of
connection
18
U.S.C.
with
§ 1028A;
the
scheme
and
to
count
of
1
obstruction of justice, in violation of 18 U.S.C. § 1512(c)(2).
The
indictment
period --
from
alleged
that
January
2009
over
a
through
three-and-one-half
August
2012
--
year
Bajoghli
“knowingly and willfully execute[d] . . . a scheme and artifice
to
defraud
and
to
obtain,
by
means
of
materially
false
and
fraudulent pretenses, . . . money owned by and under the custody
and control of health care benefit programs, in connection with
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the
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delivery
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of
health
care
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benefits,
items,
and
services.”
More particularly, seventeen counts alleged executions of the
scheme in which Bajoghli routinely diagnosed patients with skin
cancer, even though they did not, in fact, have cancer, and then
performed
tissue.
which
the
medically
Fifteen
Bajoghli
assistants”
unnecessary
counts
alleged
directed
to
perform
surgery
executions
“unlicensed
wound
Mohs
and
closures
of
the
on
scheme
unqualified
on
the
benign
in
medical
Mohs
surgery
patients and then billed the healthcare benefit programs as if
he personally had performed or supervised the closures, thereby
claiming
more
money
than
reimbursement schedule.
he
was
entitled
to
under
the
Ten counts alleged executions of the
scheme in which Bajoghli billed for services that he claimed he
had personally performed when, in fact, they had been performed
by
non-doctors,
again
allowing
him
to
claim
a
higher
reimbursement than he would have been allowed to claim had he
disclosed
eleven
bills
that
counts
“for
non-doctors
alleged
preparing
had
performed
executions
and
the
services.
in
which
Bajoghli
analyzing
[skin
pathology]
And
submitted
slides”
when, in fact, he had personally performed neither service, but
instead had hired outside contractors to perform the services at
a cost far below the amount he claimed from the programs.
Bajoghli
filed
three
pretrial
motions
government’s evidence against him at trial:
5
to
limit
the
the September 30
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motion to strike allegations of certain financial details from
Paragraph 50 of the indictment; the October 13 motion in limine
to exclude evidence of post-scheme conduct, which the government
planned to introduce to show consciousness of guilt; and the
October 20 motion in limine to exclude any evidence that was not
directly
related
to
one
of
the
53
executions
specifically
charged in the indictment.
In the September 30 motion, Bajoghli sought to strike from
Paragraph 50 the allegation that he “regularly billed the health
care benefit programs $300 to $450 per slide.”
Paragraph 50
alleged in full:
The defendant fraudulently submitted claims to
patients’ health care benefit programs for preparing
the permanent section slides and analyzing those
slides, when he actually performed neither service.
The defendant regularly billed the health care benefit
programs $300 to $450 per slide, when he had paid the
Ohio company and the dermatopathologist a total of
approximately $15 per slide for actually rendering the
services.
(Emphasis added).
Because healthcare benefit programs reimburse
physicians
predetermined
at
a
rate,
Bajoghli
claimed
that
evidence of what he billed would be unfairly prejudicial because
those amounts did not represent what he actually expected to
receive
from
the
programs.
The
district
court
granted
Bajoghli’s motion and, in doing so, also excluded, sua sponte,
any evidence of “the fees or payments Defendant allegedly made
to outside sources to perform” these services -- that is, the
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$15 per slide paid to outside contractors.
that
the
government
could
introduce
The court stated
evidence
to
prove
that
Bajoghli “would have been paid less (or not at all) had the
claims not been materially false,” but that it could not state
the specific dollar amounts.
In
the
October
13
motion,
Bajoghli
sought
to
exclude
evidence of actions that he had taken after the charged scheme
had ended, which the government planned to introduce at trial to
show his consciousness of guilt.
The government intended to
show that after Bajoghli was interviewed by law enforcement,
(1) he immediately stopped sending pathology slides to outside
contractors; (2) he stopped performing Mohs surgery without a
supporting biopsy; and (3) he deleted scheduling data for past
wound
repairs
that
were
performed
by
medical
assistants.
Bajoghli argued that this evidence was irrelevant; that it was
evidence of subsequent remedial measures, which is barred by
Federal Rule of Evidence 407; and that, if admitted at trial, it
would be unfairly prejudicial, in violation of Federal Rule of
Evidence 403.
The district court did not rule on this motion
until it ruled on the October 20 motion.
In
the
October
20
motion,
Bajoghli
sought
to
exclude
“volumes of irrelevant, uncharged misconduct” evidence, as he
characterized it, that related to his fraudulent conduct during
the three-and-one-half year period of the scheme but that was
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not directly tied to any of the 53 charged executions.
He
argued that because this evidence was not directly relevant to
any
of
the
53
charged
counts,
it
was
therefore
improper
“[p]ropensity evidence” offered only to show the defendant’s bad
character, in violation of Federal Rule of Evidence 404(b).
He
also argued that by waiting until so close to the date of trial
to give him notice of its intent to introduce this evidence, the
government
failed
to
comply
with
the
notice
requirement
of
Federal Rule of Evidence 404(b)(2).
On October 21, the day before the scheduled trial date, the
district court issued an order granting both the October 13 and
October
20
motions.
explanation,
53 charges
that
in
the
In
“[a]ll
doing
so,
testimony
indictment,”
Bajoghli’s uncharged conduct.
the
court
is . . .
thus
ruled,
limited
excluding
without
to
evidence
the
of
And in excluding evidence of the
defendant’s post-scheme conduct, it gave as reasons that the
government had not provided adequate notice of its intent to
introduce
this
“prior
‘bad
act’
evidence,”
as
required
by
Federal Rule of Evidence 404(b)(2), and, in any event, that the
evidence would be excluded under Federal Rule of Evidence 403,
as
“the
probative
value
of
[the
post-scheme]
evidence
is
substantially outweighed by the danger of unfair prejudice.”
The
government
filed
this
interlocutory
appeal,
seeking
review of the district court’s pretrial evidentiary rulings.
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II
The government first challenges the district court’s ruling
limiting
“[a]ll
testimony . . .
to
the
53
charges
of
the
indictment” and thus excluding evidence of Bajoghli’s uncharged
conduct in furtherance of the scheme during the three-and-onehalf
year
period.
debilitating
It
because
notes
that
Bajoghli’s
this
ruling
criminal
is
intent
especially
is
hotly
contested in this case, and it therefore contends that it needs
to
rebut
“isolated
the
defense
mistakes”
by
that
the
demonstrating
“cherry pick” aberrant transactions.
able
to
prove
the
charged
entire
that
transactions
it
did
not
were
merely
As it argues, it must be
scheme,
including
intentional and willful conduct in executing it.
Bajoghli’s
Such a burden,
it maintains, requires that it be allowed to introduce evidence
that, although perhaps not directly related to any of the 53
executions
charged,
scheme itself.
is
nonetheless
relevant
to
proving
the
The government warns that if it were not able to
offer evidence of uncharged executions in proving the scheme, it
would have to charge hundreds, if not thousands, of counts in
every large-scale healthcare-fraud case, such as this one.
Bajoghli
maintains
that
the
district
court
correctly
concluded that the evidence at trial must relate to one of the
specifically
charged
executions
of
the
fraudulent
scheme
and
that “evidence of an uncharged fraudulent scheme should not be
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He asserts that the government’s brief paints with
too broad a brush, ignoring the 53 specific and discrete charges
it brought under § 1347.
As he argues, “the evidence at trial
must relate to a specific allegation of fraud that the jury will
have to consider.”
uncharged
charged
Rule 403
conduct
Because, as he contends, any evidence of
would
executions,
as
be
the
unfairly
only
evidence
“loosely
should
prejudicial
and
relevant”
be
to
excluded
under
the
under
Rule 404(b),
including Rule 404(b)(2)’s notice requirement, as “other acts”
evidence.
The
scope
of
relevant
evidence
dictated by the indictment.
at
trial
is,
of
course,
In this case, however, Bajoghli’s
position reveals a misunderstanding of the nature of the charges
in the indictment and the scope of proof that is relevant.
Section
1347
punishes
“[w]hoever
knowingly
and
willfully
executes . . . a scheme . . . to defraud any health care benefit
program”
when
delivering
healthcare
§ 1347(a)(1) (emphasis added).
element of the offense.
129,
137-38
(4th
Cir.
services.
18
U.S.C.
A “scheme to defraud” is thus an
See United States v. McLean, 715 F.3d
2013)
(“To
sustain
a
conviction
under
18 U.S.C. § 1347, the government [is] required to prove beyond a
reasonable doubt that [the defendant] knowingly and willfully
executed a scheme to defraud insurers by billing for medically
unnecessary procedures” (emphasis added)).
10
While fraud can be
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committed
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simply
by
engaging
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in
an
isolated
transaction,
a
scheme to defraud requires a plot, plan, or arrangement that is
executed
by
Dictionary
a
1546
fraudulent
(10th
ed.
transaction.
2014)
See
(defining
Black’s
“scheme”
as
Law
“[a]
systemic plan; a connected or orderly arrangement”; or “[a]n
artful plot or plan, [usually] to deceive others”).
In
this
case,
the
scheme
alleged
in
the
indictment
is
described as encompassing four types of conduct, beginning in
January 2009 and continuing through August 2012.
And although
the indictment charged only 53 “executions” of the scheme in
53 separate
execution
counts,
was
“part
it
of
also
the
alleged
scheme
and
that
each
artifice
to
particular
defraud.”
Thus, the indictment charged that “for the purpose of executing
the aforementioned scheme and artifice,” described earlier to
have lasted from January 2009 through August 2012, the defendant
engaged in the particularly described fraudulent transactions.
(Emphasis added).
Because a scheme is an element of a § 1347
offense and because the specifically alleged three-and-one-half
year scheme is made part of each execution, evidence of the
entire scheme is relevant to proving each particular execution.
It is important to recognize that just as all the overt
acts of a conspiracy need not be charged in an indictment, see
United States v. Janati, 374 F.3d 263, 270 (4th Cir. 2004) (“It
is well established that when seeking to prove a conspiracy, the
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government is permitted to present evidence of acts committed in
furtherance
of
the
conspiracy
even
though
they
are
not
all
specifically described in the indictment”), all executions of a
scheme likewise need not be charged, see United States v. Pless,
79 F.3d 1217, 1220 (D.C. Cir. 1996) (“That the government chose
to charge as the execution of the scheme only the three deposits
in National [Bank] does not reduce the boundaries of the scheme,
which the statute requires the government to prove. . . . [I]t
is not necessary for the government to charge every single act
of execution of the scheme in order to prove the whole scheme”).
Nonetheless, evidence of transactions and conduct not charged is
relevant to proving the existence of and the boundaries of the
conspiracy
or
scheme.
See
Janati,
374
F.3d
at 275
(“[T]he
government has the right and the burden to prove in its case-inchief
a
conspiracy
alleged
[and]
government
a
broader
therefore
reasonable
the
than
the
individual
district
opportunity
to
court
carry
overt
acts
must
give
the
this
burden”);
Pless, 79 F.3d at 1220 (“[T]he government is [not] artificially
limited
to
presenting
to
the
jury
only
that
portion
of
scheme that directly related to [the charged executions]”).
the
A
scheme and a conspiracy thus are, for these purposes, similar
concepts.
See United States v. Lothian, 976 F.2d 1257, 1262
(9th Cir. 1992) (“Because an essential element of these offenses
is a fraudulent scheme, mail and wire fraud are treated like
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conspiracy in several respects”); United States v. Read, 658
F.2d
1225,
conspiracy
1239
(7th
embrace
Cir.
1981)
analogous,
but
(“A
scheme
not
to
identical,
defraud
and
concepts”);
United States v. O’Connor, 580 F.2d 38, 41-42 (2d Cir. 1978)
(equating “a continuing scheme” with a conspiracy); SEC v. Nat’l
Bankers Life Ins. Co., 324 F. Supp. 189, 195 (N.D. Tex. 1971)
(describing “the possibility of reading ‘scheme’ as synonymous
with
a
conspiracy”
in
a
federal
securities
statute).
We
therefore conclude that when the government charges a defendant
under § 1347 with a scheme to defraud and elects to charge only
some of the executions of that scheme, its election does not
limit
its
proof
to
only
the
charged
executions.
It
may
introduce other evidence of uncharged executions to prove the
scheme.
To be sure, a district court still retains broad-ranging
discretion
to
manage
trials
instance, overly duplicative.
and
limit
proof
that
is,
for
But, as we noted in Janati, its
discretion must be balanced by the need to give the government
adequate latitude to prove its case, especially in a large and
complex
healthcare-fraud
intent is placed at issue.
case
where
the
defendant’s
See 374 F.3d at 273-74.
criminal
We conclude
that, in this case, the district court abused its discretion in
failing to give the government sufficient latitude to carry its
burden of proof.
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In addition, it follows that because evidence of conduct
not
charged
in
a
specific
execution
may
be
relevant
to
the
nature and scope of a scheme charged under § 1347, such evidence
is intrinsic to the “scheme” element, and Rule 404(b) therefore
does not, as Bajoghli argues, regulate it as “other bad acts”
evidence.
See Unites States v. Grimmond, 137 F.3d 823, 832 (4th
Cir. 1998) (“[W]hen ‘other crimes, wrongs, or acts’ evidence is
relevant to establishing an element of the offense, Rule 404(b)
is not even implicated”).
In
sum,
we
conclude
that
the
district
court
abused
its
discretion in limiting the government’s proof to that which is
directly relevant to one or more of the 53 executions charged in
the indictment, without taking into account the relevance of
uncharged
conduct
to
the
alleged
overarching
scheme.
The
government has the burden of proving a scheme to defraud and
Bajoghli’s knowing and willful conduct in executing the scheme.
And to that end, it must be allowed to offer evidence probative
of these elements, even if that evidence is not directly related
to one of the 53 executions.
III
The government next challenges the district court’s ruling
to exclude evidence of the defendant’s post-scheme conduct.
It
seeks to introduce evidence (1) that “after being interviewed by
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law
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enforcement,
[Bajoghli]
pathology
slides”
interview,
“the
without
biopsy”;
a
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to
outside
defendant
and
immediately
contractors;
stopped
(3) that
stopped
(2) that
performing
the
sending
after
Mohs
defendant
his
surgery
“delet[ed]
scheduling data for the past wound repairs that were performed
by
medical
evidence
assistants.”
to
be
The
“prior
district
‘bad
act’
court
considered
evidence”
governed
this
by
Rule 404(b) and excluded it on the ground that the government
had not provided Bajoghli with adequate notice, as required by
Rule 404(b)(2). ∗ Moreover, the court excluded this evidence under
Rule 403, concluding that its probative value was “substantially
outweighed by the danger of unfair prejudice . . . , confusing
the
jury . . . ,
government
argues
and
waste
that
the
of
judicial
district
court
resources.”
erred
in
The
applying
Rule 404(b) because the evidence is intrinsic to the charged
crimes; that is, it “bear[s] directly on the defendant’s intent
as
to
the
charged
fraud
(not
∗
some
other
crime)
and
[is]
Even if Rule 404(b) were to apply, it is difficult to
understand how the government had not provided adequate notice
to Bajoghli. Bajoghli’s motion to exclude evidence of his postscheme conduct admitted as much, stating, “The government has
indicated that they plan to introduce evidence of changes in
procedures and practices in [his] offices after he became aware
that he was under criminal investigation, presumably to
demonstrate that the prior practices were illegal.”
Moreover,
in his motion to exclude this evidence, Bajoghli did not raise a
lack of notice as a ground for exclusion.
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inextricably intertwined with how he committed the fraud and his
efforts to conceal it once he learned [of the] investigation.”
Bajoghli
contends
that
Rule 404(b)
does
apply
to
this
evidence because, as he argued with respect to the evidence of
his uncharged conduct, it would not be “tied to any one of the
53 narrowly defined executions of healthcare fraud” and thus
would
not
be
“intrinsic”
to
the
charged
offenses.
More
particularly, he contends that “evidence of remedial measures,”
as
a
matter
of
law,
“cannot
be
‘intrinsic’
to
any
of
[the
charged] offenses” because the remedial measures all occurred
after the period of time noted in the indictment as encompassing
the alleged fraudulent scheme.
its
admission
would
be
In addition, he contends that
unfairly
prejudicial
under
Rule 403,
parroting the district court’s conclusion.
Again, we agree with the government.
As the government
points out, it intends to offer evidence of Bajoghli’s postscheme conduct to prove his knowledge and intent to defraud, as
is
required
by
§ 1347.
For
instance,
that
Bajoghli
stopped
sending pathology slides to outside contractors after he learned
he was under investigation, but before federal agents had even
become aware of this practice -- as the government represents -would
tend
to
prove
Bajoghli’s
fraudulent
intent
knowledge with respect to this aspect of the scheme.
and
guilty
Similarly,
the government notes that Bajoghli “intends to challenge [the
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charge
of
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Mohs
reasonable
exercised
fraudulent
Pg: 17 of 22
surgeries]
medical
by
judgment
asserting
in
that
performing
he
Mohs
surgeries and that any errors were the product of innocent . . .
mistakes.”
Thus, it reasons, evidence that Bajoghli stopped his
practice of performing Mohs surgeries without first reviewing
biopsies once he learned of the investigation would tend to show
that he knew the accepted standard of care for diagnosing skin
cancer
and
had
deliberately
chosen
to
disregard
it.
And
finally, as the government notes, evidence that Bajoghli deleted
scheduling data from his computers -- data that revealed who had
actually
performed
wound-repair
procedures
--
would
tend
to
refute his claim that this aspect of the fraud resulted from
honest
billing
mistakes.
Cf.
McLean,
715
F.3d
at
139
(concluding that evidence that the defendant “attempted to shred
patient files subpoenaed” by the government was probative that
the defendant knew he “had something to hide”).
The proffered
evidence therefore would be probative to prove knowledge and
intent,
which
indictment.
are
elements
of
the
crimes
charged
in
the
And because Rule 404(b) does not apply to conduct
that is intrinsic to the charged crime, the district court erred
in applying the rule to this evidence.
See United States v.
Basham, 561 F.3d 302, 326 (4th Cir. 2009) (“The Rule 404(b)
inquiry . . . applies only to evidence of other acts that are
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‘extrinsic to the one charged’” (quoting United States v. Chin,
83 F.3d 83, 87 (4th Cir. 1996))).
Bajoghli
cannot
be
nonetheless
intrinsic
to
argues
the
that
charged
his
post-scheme
offenses
because
conduct
it
took
place after the end of the period of activity charged in the
indictment.
But it simply does not follow that conduct that
takes place after the end of the period of activity charged in
the
indictment
is
--
as
a
matter
requirements of Rule 404(b).
of
law
--
subject
to
the
In fact, our case law demonstrates
that simply because a defendant’s conduct takes place outside
the time frame of the activities charged in the indictment does
not,
as
Bajoghli
extrinsic
to
argues,
charged
the
Rule 404(b).
automatically
offense
and
render
that
therefore
conduct
subject
to
See United States v. Kennedy, 32 F.3d 876, 885
(4th Cir. 1994) (“The basic flaw in [the defendant’s] argument
is that . . . [it] erroneously assumes that all evidence falling
outside
the
separate,
charged
unrelated
[Rule 404(b)].
conspiracy
offense
period
subject
necessarily
to
the
involves
strictures
a
of
It is well-established, however, that the mere
fact that the evidence involved activities occurring before the
charged
time
transform
frame
that
of
the
evidence
conspiracy
into
does
‘other
not
crimes’
automatically
evidence”).
Instead, conduct that takes place outside the time frame of the
charged offense can avoid having to comply with the requirements
18
Appeal: 14-4798
of
Doc: 28
Filed: 05/11/2015
Rule 404(b)
where
it
Pg: 19 of 22
is,
inter
alia,
establishing an element of the offense.”
at 831-32.
“relevant
to
Grimmond, 137 F.3d
And, as we concluded above, Bajoghli’s post-scheme
conduct is relevant to proving his fraudulent intent and guilty
knowledge.
The
district
court’s
additional
ruling
--
that
Rule 403
requires exclusion of the evidence because its probative value
is substantially outweighed by the danger of unfair prejudice
and
other
constitutes
concerns
--
unfair
reflects
prejudice
a
misunderstanding
under
Rule 403.
of
Once
it
what
is
recognized that evidence is probative of an element of the crime
charged, “the balance under Rule 403 should be struck in favor
of
admissibility,
sparingly.”
and
evidence
should
be
excluded
only
United States v. Aramony, 88 F.3d 1369, 1378 (4th
Cir. 1996); see also United States v. Siegel, 536 F.3d 306, 31920
(4th
Cir.
2008).
And
in
this
context,
unfair
prejudice
“speaks to the capacity of some concededly relevant evidence to
lure the factfinder into declaring guilt on a ground different
from proof specific to the offense charged.”
Basham, 561 F.3d
at 327 (emphasis added) (quoting Old Chief v. United States,
519 U.S. 172, 180 (1997)) (internal quotation marks omitted).
Neither
ground
Bajoghli
that
would
nor
the
support
district
a
finding
court
of
has
guilt
proof that is specific to the offense charged.
19
identified
different
any
from
Appeal: 14-4798
Doc: 28
Because
Rule 403
Filed: 05/11/2015
the
in
district
excluding
Pg: 20 of 22
court
misapplied
evidence
of
Rule 404(b)
Bajoghli’s
and
post-scheme
conduct, it abused its discretion.
V
Finally,
the
government
challenges
the
district
court’s
ruling to exclude evidence that, despite receiving between $100
and $130 per slide from healthcare benefit programs based on his
claim that he both prepared and analyzed his patients’ pathology
slides himself, Bajoghli paid outside contractors only $15 per
slide
to
evidence
perform
of
those
financial
tasks.
gain
The
“is
government
critical
in
establish a defendant’s intent to defraud.”
arrangement
between
Bajoghli
and
the
a
contends
fraud
that
case
to
It argues that the
outside
contractors
is
“part and parcel of proving this aspect of the fraud” and that
“an essential part of this arrangement was the amount that the
defendant
paid
substantial
them.”
disparity
According
between
the
to
the
amount
government,
that
the
“[t]he
defendant
received, and what he paid” can only “underscore[] [Bajoghli’s]
motive for this intentional deception.”
Bajoghli contends that evidence of what he paid the outside
contractors is irrelevant, and thus he urges us to affirm the
district court’s ruling to exclude it.
According to Bajoghli,
“this case is about billing and whether or not the billing was
20
Appeal: 14-4798
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false.”
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Pg: 21 of 22
Because “[a]ny amounts paid to outside contractors were
not part of the alleged misrepresentations in bills submitted to
insurers,” those amounts, he argues, “were not material to the
charged
offenses
of
executing
healthcare
fraud
schemes
by
submitting false claims.”
We agree with the government.
Because a violation of the
healthcare fraud statute requires knowing and willful conduct,
see
18
U.S.C.
§ 1347(a),
the
Bajoghli’s intent to defraud.
government
must
establish
United States v. Godwin, 272 F.3d
659, 666 (4th Cir. 2001).
And evidence of financial gain is
particularly
a
defendant’s
Beverly,
accord
probative
intent
284
United
F.
to
fraud
defraud.
App’x
States
in
36,
v.
case
See,
40
to
e.g.,
United
(4th
Cir.
2008)
490
F.3d
541,
Davis,
establish
States
(per
549
the
v.
curiam);
(6th
Cir.
2007); United States v. Dearing, 504 F.3d 897, 901 (9th Cir.
2007) (endorsing the Sixth Circuit’s declaration in Davis that
evidence of profits can serve as indirect proof of one’s intent
to defraud); United States v. Wheeler, 889 F. Supp. 2d 64, 68
(D.D.C. 2012) (“In a § 1347 [healthcare-fraud] case, ‘intent [to
defraud] can be inferred . . . from profits’” (quoting Dearing,
504 F.3d at 901)).
Moreover,
the
district
court’s
ruling
allowing
the
government to introduce evidence that the defendant “would have
been
paid
less
(or
not
at
all)
21
had
the
claims
not
been
Appeal: 14-4798
Doc: 28
materially
false”
Filed: 05/11/2015
simply
does
Pg: 22 of 22
not
allow
the
government
present its case with sufficient detail and narrative.
to
Cf. Old
Chief, 519 U.S. at 183 (recognizing “the offering party’s need
for evidentiary richness and narrative integrity in presenting a
case”).
We conclude, accordingly, that the district court abused
its discretion in excluding this evidence.
REVERSED AND REMANDED
22
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