Justia Government Contracts Opinion Summaries

Plaintiff-inmate Kirk Wool appealed the dismissal of his claim that the Vermont Department of Corrections violated a statutory obligation to negotiate and award a contract to provide telephone services to inmates serving in state correctional facilities in a manner that provided for the lowest reasonable cost to inmates. After review, the Vermont Supreme Court affirmed the trial court’s dismissal of plaintiff’s claim for money damages, but reversed the dismissal of plaintiff’s claim for mandamus relief and remanded for further proceedings. As plaintiff alleged, DOC was required by Vermont law, albeit not specifically and exclusively by the statute he identified in his complaint, to use a competitive bidding process in contracting for telephone services for inmates. The Court found plaintiff’s allegations were sufficient to confer standing and give fair notice to DOC of the claim and the grounds upon which it rested. View "Wool v. Menard" on Justia Law

Brown, the manager of a company that provided home physician visits, and Talaga, who handled the company’s billing, were convicted of conspiracy to commit health-care fraud, 18 U.S.C. 1349; six counts of health-care fraud, 18 U.S.C. 1347; and three counts of falsifying a matter or providing false statements, 18 U.S.C. 1035(a). The district court sentenced Mr. Brown to 87 months’ imprisonment, 34 months below the Guidelines’ range, stating that a significant sentence was warranted because of the duration of the scheme, the amount of the fraud, the need for general deterrence, and Brown’s failure to accept responsibility. Ms. Talaga was sentenced to 45 months. The Seventh Circuit affirmed, rejecting Brown’s argument that the court’s assumptions about the need for general deterrence were unfounded and constituted procedural error and Talaga’s arguments that the court calculated the amount of loss for which she was responsible by impermissibly including losses that occurred before she joined the conspiracy. The district court was under no obligation to accept or to comment further on Brown’s deterrence argument. Talaga, as a trained Medicare biller, knew that that the high-volume billings were fraudulent. View "United States v. Talaga" on Justia Law

The Supreme Court affirmed the judgment of the circuit court affirming the district court’s dismissal of this action filed by Big Sandy Regional Jail Authority against the Lexington-Fayette Urban County Government seeking reimbursement for the cost of housing prisoners held pursuant to warrants issued by Fayette County courts. The district court dismissed the case after finding that the Urban County Government was entitled to sovereign immunity. The circuit court affirmed without addressing the issue of sovereign immunity, finding, rather, that the county of arrest controls responsibility for incarceration costs. The Supreme Court affirmed, but on different grounds, holding that the Urban County Government was not responsible for the costs of incarcerating prisoners not in its possession. View "Big Sandy Regional Jail Authority v. Lexington-Fayette Urban County Government" on Justia Law

In 2014, following investigations by the Indiana Attorney General and FBI, a grand jury indicted Shorter and her company, Empowerment, which provided transportation to Medicaid patients, for health care fraud, 18 U.S.C. 1347, and three counts of misusing a means of identification, 18 U.S.C. 1028A. The government submitted evidence of Shorter’s personal involvement in Empowerment’s billing practices; the results of an Indiana Attorney General Investigation into Empowerment’s billing practices; an FBI search of Empowerment’s records; and the experiences of Empowerment employees and of clients who used its services. The Seventh Circuit affirmed her convictions rejecting arguments challenging the indictment, the admission of certain evidence at trial and the sufficiency of the evidence as a whole. The court noted “powerful” circumstantial evidence that permitted the jury to convict her, especially because the jury could reasonably infer from the evidence that she “caused” the fraudulent billings. View "United States v. Shorter" on Justia Law

Kolbusz, a dermatologist, submitted thousands of claims to the Medicare system and private insurers for the treatment of actinic keratosis, a skin condition that sometimes leads to cancer. He received millions of dollars in payments. Convicted of six counts of mail or wire fraud, 18 U.S.C. 1341, 1343, he was sentenced to 84 months in prison plus $3.8 million in restitution. The Seventh Circuit affirmed. The evidence permitted a reasonable jury to conclude that many, if not substantially all, of the claims could not have reflected an honest medical judgment and that the treatment Kolbusz claimed to have supplied may have failed to help any patient who actually had actinic keratosis. Because the indictment charged a scheme to defraud, the prosecutor was entitled to prove the scheme as a whole, and not just the six exemplars described in the indictment. The judge did not err in excluding evidence that, after his arrest and indictment, Kolbusz continued to submit claims to Medicare, and many were paid. “It would have been regrettable to divert the trial into an examination of Medicare’s claims-processing procedures in 2013 and 2014, rather than whether Kolbusz knew that he was submitting false claims in 2010 and earlier." View "United States v. Kolbusz" on Justia Law

Former FBI agent Robert Lustyik wanted to help his friend and business partner, Michael Taylor, in return for payment. Taylor owned American International Security Corporation (AISC), a company that offered security and defense contracting services. The Department of Defense awarded AISC a contract in 2007 to provide training and related services to Afghan Special Forces. In mid-2010, the United States began investigating AISC regarding fraud and money laundering in connection with the 2007 contract. In September 2011, the United States filed a civil forfeiture action against assets owned by Taylor and AISC, which resulted in the seizure of more than $5 million dollars from AISC’s bank account. Lustyik used his status as an FBI agent to impair the government’s investigation of Taylor, including attempting to establish Taylor as a confidential source. Lustyik was indicted on charges related to the obstruction of justice. Prior to trial, Lustyik pleaded guilty to all charges in the indictment without a plea agreement. After his plea, his lead counsel withdrew and Lustyik obtained new counsel. On the eve of sentencing, counsel sought an order allowing him to obtain security clearance to review classified material he believed might be relevant for sentencing. The district court, having previously reviewed the documents, deemed them irrelevant to the sentencing issues, denied the motion, and subsequently sentenced Lustyik to 120 months’ imprisonment. Lustyik argued on appeal that the district court’s order denying his counsel access to the classified materials violated his Sixth Amendment rights at sentencing. Finding that the district court’s decision was not presumptively prejudicial to Lustyik’s advocacy at sentencing, nor did the district court abuse its discretion in concluding the documents were not relevant for sentencing, the Tenth Circuit affirmed. View "United States v. Lustyik" on Justia Law

In 2008, Javidan shadowed Shahab, who was involved with fraudulent home-health agencies. Javidan, Shahab, and two others purchased Acure Home Care. Javidan managed Acure, signing Medicare applications and maintaining payroll. She had sole signature authority on Acure’s bank account and, was solely responsible for Medicare billing. Javidan illegally recruited patients by paying “kickbacks” to corrupt physicians and by using “marketers” to recruit patients by offering cash or prescription medications in exchange for Medicare numbers and signatures on blank Medicare forms. Javidan hired Meda as a physical therapist. Meda signed revisit notes for patients that he did not visit. He told Javidan which patients were not homebound and which demanded money for their Medicare information. The government charged both with health care fraud conspiracy (18 U.S.C. 1347) and conspiracy to receive kickbacks (18 U.S.C. 371). At trial, Javidan testified that she did not participate in and was generally unaware of Acure’s fraudulent business practices. Meda called no witnesses. Javidan and Meda were sentenced to terms of 65 and 46 months of imprisonment, respectively. The Sixth Circuit affirmed, rejecting Meda’s claims that his conviction violated the Double Jeopardy Clause and that he was subjected to prosecutorial vindictiveness for refusing to plead guilty and requesting a jury trial in prior case and Javidan’s claims of improper evidentiary rulings and sentence calculation errors. View "United States v. Javidan" on Justia Law

A jury found Ferrell, a licensed psychologist, and Bryce, Ferrell’s employee, guilty of six counts of healthcare fraud, 18 U.S.C. 1347. Ferrell was sentenced to 88 months of imprisonment. The Seventh Circuit affirmed, upholding the district court’s refusal to admit two out-of-court statements made by Bryce’s brother (also Ferrell’s employee), and contained in a voicemail and an email. The district court held that these statements were hearsay and did not fall within Rule 804(b)(3)’s hearsay exception. The district court held that although the brother was unavailable to testify, the statements were not against his interest and the corroborating circumstances did not indicate that his statements were trustworthy. The court also upheld admission of testimony by another doctor concerning Ferrell’s conduct while in Texas. The court found that the testimony did not constitute impermissible character evidence under Fed. R. Evid. 404(b). View "United States v. Ferrell" on Justia Law

Nagle and Fink were co-owners and executives of concrete manufacturing and construction businesses. The businesses entered into a relationship with a company owned by a person of Filipino descent. His company would bid for subcontracts on Pennsylvania transportation projects as a disadvantaged business enterprise. Federal regulations require states that receive federal transportation funds to set annual goals for participation in transportation construction projects by disadvantaged business enterprises, 49 C.F.R. 26.21. If his company won the bid for the subcontract, Nagle and Fink’s businesses would perform all of the work. Fink pled guilty to conspiracy to defraud the United States. A jury found Nagle guilty of multiple charges relating to the scheme. The Third Circuit affirmed Nagle’s conviction, upholding the admission of electronic evidence discovered during searches of the businesses’ offices, but vacated both sentences, based on loss calculation errors. View "United States v. Nagle" on Justia Law

Beginning in 2008 Mullins served as Cook County’s Director of Public Affairs and Communications. At that time, contracts requiring the county to spend $25,000 or more had to be approved by its Board of Commissioners. Contracts that required the county to spend less than $25,000 only required the approval of the county’s purchasing agent. The government charged Mullins and co-defendants—vendors to whom the county awarded contracts—with manipulating the system. Mullins helped these vendors obtain payment under county service contracts, without the vendors having to complete any work, and in exchange they paid Mullins $34,748 in bribes. Jurors convicted him of four counts of wire fraud, 18 U.S.C. 1343, and four counts of bribery, section 666. The Seventh Circuit rejected Mullins’s challenge to the sufficiency of the evidence and claim of prosecutorial misconduct. View "United States v. Mullins" on Justia Law