United States v. Kolbusz, No. 15-2962 (7th Cir. 2016)

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Justia Opinion Summary

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."

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In the United States Court of Appeals For the Seventh Circuit ____________________ No. 15 2962 UNITED STATES OF AMERICA, Plaintiff Appellee, v. ROBERT KOLBUSZ, Defendant Appellant. ____________________ Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 12 CR 782 — John Z. Lee, Judge. ____________________ ARGUED SEPTEMBER 20, 2016 — DECIDED SEPTEMBER 21, 2016 ____________________ Before BAUER, POSNER, and EASTERBROOK, Circuit Judges. EASTERBROOK, Circuit Judge. A jury convicted Robert Kol busz of six counts of mail or wire fraud, see 18 U.S.C. §§ 1341, 1343, and he was sentenced to 84 months’ impris onment (the same term on each count to run concurrently) plus about $3.8 million in restitution. Kolbusz, a dermatologist, submitted thousands of claims to the Medicare system and private insurers for the treat 2 No. 15 2962 ment of actinic keratosis, a skin condition that sometimes leads to cancer. He received many millions of dollars in payments. The evidence at trial permitted a reasonable jury to conclude that many if not substantially all of these 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 kera tosis. We need not recount the evidence. Kolbusz put on a vigorous defense, but the record permitted the jury to find that he committed the crimes as charged. His lead appellate argument is that the district judge con structively amended the indictment by permitting the prose cutor to present evidence that he submitted false claims on behalf of more than six patients. The indictment charged six particular frauds, so that must be the limit of the evidence, the argument runs. Yet the indictment charged a scheme to defraud (that’s what §1341 and §1343 cover). The prosecutor was entitled to prove the scheme as a whole, and not just the six exemplars laid out in the indictment. See, e.g., United States v. Phillips, 745 F.3d 829, 831–33 (7th Cir. 2014); United States v. Salmonese, 352 F.3d 608, 621 (2d Cir. 2003). Kolbusz does not point to any decision holding that the prosecution is forbidden to show that a scheme has more victims than the number of counts in the indictment, and we could not find such a decision in an independent search. After his arrest and indictment, Kolbusz continued to submit claims to Medicare, and many of these were paid. He contends that the judge erred in preventing him from intro ducing evidence to that effect. But the judge did not abuse his discretion in excluding this evidence, which has more to say about the (lack of) care with which Medicare intermedi No. 15 2962 3 aries examine physicians’ claims than about the validity of the charges against him. Kolbusz says that the evidence would demonstrate his “good faith,” but we do not under stand how—or for that matter why “good faith” in the ab stract matters. See United States v. Blagojevich, 794 F.3d 729, 738–39 (7th Cir. 2015). Kolbusz’s state of mind when he was submitting claims between 2003 and 2010 (the period cov ered by the criminal charges) was relevant; his state of mind in later years was not. It would have been regrettable to di vert 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. Finally, Kolbusz contends that, when resolving civil liti gation that grew out of his claims for reimbursement, some of the insurers agreed to waive restitution. He contends that payments from these insurers should be excluded from the district court’s calculation. The problem with this argument is that the United States was not a party to any of the con tracts on which Kolbusz relies. The award of restitution was entered in litigation between Kolbusz and the United States; contracts between Kolbusz and third parties cannot control. So the Supreme Court held in EEOC v. Waffle House, Inc., 534 U.S. 279 (2002), when concluding that arbitration agreements between employees and employers do not affect the national government, when it sues as employees’ champion. The Court concluded that private agreements do not bind the United States. That’s equally true when the United States seeks a restitution award, and so multiple courts have held. See, e.g., United States v. Rizk, 660 F.3d 1125, 1137 (9th Cir. 2011); United States v. Gallant, 537 F.3d 1202, 1250 (10th Cir. 2008); United States v. Karam, 201 F.3d 320 (4th Cir. 2000); 4 No. 15 2962 United States v. Parsons, 141 F.3d 386, 393 (1st Cir. 1998); Unit ed States v. Sheinbaum, 136 F.3d 443, 448–49 (5th Cir. 1998). AFFIRMED