Justia U.S. 5th Circuit Court of Appeals Opinion Summaries

In September 2020, George Fluitt was indicted on three counts of fraud and offering kickbacks related to genetic testing services that his company, Specialty Drug Testing LLC, provided to Medicare beneficiaries. As part of a nationwide investigation into genetic testing fraud, the Government executed search warrants at laboratories referred to as the Hurricane Shoals Entities (“HSE”), allegedly operated by Khalid Satary. The Government copied several terabytes of data from HSE, some of which were later determined to be material to Fluitt’s defense.In the lower courts, the Government established a “Filter Team” to review materials seized in its investigation and identify any that might be privileged. The Filter Team’s review was governed in part by a Protocol Order, which established a multi-step process for notifying a third party that it might have a claim of privilege and then adjudicating that claim. HSE and Satary provided privilege logs to the Filter Team, asserting thousands of claims of privilege. Both Fluitt and the Filter Team found these privilege logs to be facially deficient as they made only threadbare assertions of privilege, without any accompanying explanation.In the United States Court of Appeals Fifth Circuit, the court affirmed the lower court's decision. The court found that the appellants failed to establish their claims of privilege. The court also found that the appellants' argument that they are not bound by the Protocol Order was a red herring, as the magistrate judge evaluated the appellants’ privilege logs under the standards established by federal caselaw. The court also rejected the appellants' argument that Fluitt “has not shown a need for the documents” and has not “demonstrated any kind of relevancy.” The court found that the record suggests that Fluitt “has a need” for the potentially privileged documents, as the Government determined that the potentially privileged materials were material to preparing Fluitt’s defense. View "United States v. Fluitt" on Justia Law

The United States Court of Appeals for the Fifth Circuit affirmed the conviction and sentence of defendant Vincent Marchetti, Jr., who was found guilty of one count of conspiracy to commit illegal remunerations in violation of 18 U.S.C. § 371. Marchetti was involved in a scheme wherein Vantari Genetics LLC, a medical laboratory, paid distributors to attract Medicare referrals to Vantari. Marchetti, who operated Advanced Life Sciences LLC, was one of the distributors and had a network of sub-distributors. The court found sufficient evidence that Marchetti was knowingly and actively participating in a scheme involving CodonDx, another entity, that violated the Anti-Kickback Statute. The court rejected Marchetti's challenges regarding the sufficiency of the evidence, the district court's failure to submit his theory of defense instruction, the court's alleged constructive amendment of the indictment, and the court's application of the sentencing guidelines. The court also dismissed his claim for a new trial based on cumulative error. View "USA v. Marchetti" on Justia Law

The United States Court of Appeals for the Fifth Circuit reviewed a case involving the question of whether the federal Title X program preempts a Texas law that gives parents the right to consent to their teenagers’ obtaining contraceptives. Alexander Deanda, a father raising his children according to Christian beliefs, challenged the Secretary of Health and Human Services' administration of Title X, which funds clinics providing contraceptives to minors without parental notification or consent. Deanda contested this on the grounds that it nullifies his right to consent to his children's medical care, infringing on his state-created right. The court held that Title X does not preempt Texas's law. The statute does not preempt Deanda's parental right to consent to his children's obtaining contraceptives because Title X's goal (encouraging family participation in teens’ receiving family planning services) is not undermined by Texas's goal (empowering parents to consent to their teen’s receiving contraceptives). Instead, the two laws reinforce each other. The court affirmed the district court’s judgment to the extent it declared that Title X does not preempt Texas's parental consent law. However, the court reversed the partial vacatur of a regulation which forbids Title X grantees from notifying parents or obtaining their consent, as the regulation was not challenged by Deanda under the Administrative Procedure Act or otherwise. View "Deanda v. Becerra" on Justia Law

The case concerns an appeal by Andrew Ocanas Garza against his conviction and a 235-month sentence for drug trafficking and firearm possession. Garza argued that the court incorrectly used his 2016 felony drug offenses for sentencing enhancement, contending that the 2018 amendment to the Agricultural Improvement Act altered marijuana’s definition, potentially excluding the substance he was previously convicted for trafficking. He also claimed that the court erred by not suppressing an unMirandized statement he made about having a gun in his bedroom during the execution of a search warrant.The United States Court of Appeals for the Fifth Circuit affirmed the District Court's ruling. The Appeals Court held that Garza waived his right to challenge the admission of the Bedroom Gun statement by bringing it up during the trial. The Court also rejected Garza's argument concerning the sentencing enhancement based on his 2016 drug convictions. The Court applied the "backward-looking" test, which determines whether the prior convictions were felonies at the time of conviction and were final at the time of sentencing for the current crimes. The Court found that Garza's 2016 convictions met these criteria, making them applicable for sentencing enhancement. The Court also noted that even if the District Court had erred in applying the sentencing enhancement, the error was harmless, as the same sentence would have been imposed. View "United States v. Garza" on Justia Law

In a healthcare fraud case involving Medicare kickbacks, defendants Lindell King and Ynedra Diggs appealed their convictions and sentences. They challenged the United States District Court for the Southern District of Texas's decision to admit recordings involving them and other co-conspirators, and disputed the court's calculation of the improper benefit received for the purpose of their sentence, as well as the restitution award. The United States Court of Appeals for the Fifth Circuit examined these arguments and ruled in favor of the lower court.The defendants were accused of receiving bribes from a Medicare provider, Dr. Paulo Bettega, for referring Medicare beneficiaries to him for unnecessary treatment or non-provided treatment. The Court of Appeals rejected the defendants' Confrontation Clause arguments, stating the recordings were not testimonial and did not violate the Confrontation Clause. It further dismissed the defendants' assertion that the recordings were impermissible hearsay.Regarding the calculation of the improper benefit, the court concluded that the government had proved by a preponderance of the evidence that the entire operation was fraudulent. The defendants failed to provide rebuttal evidence of any legitimate medical expenses that should offset the amount paid to Bettega for treatment provided to residents of their group homes.The Court of Appeals also upheld the restitution award. It rejected the defendants' argument that their maximum restitution was limited to the $70,000 they received in kickbacks. The court held the defendants jointly and severally liable for all foreseeable losses within the scope of their conspiracy.In conclusion, the Court of Appeals affirmed the judgment and sentence of the district court, finding no error in its proceedings or decisions. View "USA v. King" on Justia Law

The United States Court of Appeals for the Fifth Circuit affirmed the district court’s decision to order Marty Johnson, the owner of a mental health rehabilitation clinic, and Keesha Dinkins, an employee of the clinic, to pay $3.5 million in restitution. Johnson and Dinkins had pleaded guilty to charges related to a fraudulent billing scheme targeting Medicaid that lasted from 2014 to 2018. On the day before their jury trial was set to begin, both defendants pled guilty to their respective charges and agreed in their plea deals to recommend $3.5 million in restitution. However, after their pleas were accepted, both defendants objected to the restitution order, arguing that it was erroneous. Johnson challenged the loss and restitution calculation while Dinkins argued that the entire loss should not have been attributed to her. The court held that the defendants were bound by the plea agreements they had made and affirmed the district court’s order for each defendant to pay $3.5 million in restitution. The court found that there was sufficient evidence to support the pleas, the restitution amount did not exceed the actual loss, and the district court appropriately used the total loss amount when calculating Dinkins’s sentence. View "USA v. Dinkins" on Justia Law

In the United States Court of Appeals for the Fifth Circuit, the case involved Marty Johnson, the owner of a mental health rehabilitation clinic, and Keesha Dinkins, an employee of the same clinic. Both defendants fraudulently billed Medicaid for illegitimate services between 2014 and January 2018. On the day their jury trial was scheduled to begin, Johnson pled guilty to conspiracy to commit healthcare and wire fraud, and Dinkins pled guilty to misprision of a felony. Each of their plea agreements stipulated a loss of $3.5 million and recommended that the judge order $3.5 million in restitution to the government. The district court accepted the defendants' recommendations and ordered each to pay $3.5 million in restitution. After receiving the benefit of their plea bargain, both defendants argued that the $3.5 million order was erroneous. Dinkins also contended that under the sentencing guidelines, the entire loss should not have been attributed to her. The court held the defendants to the plea bargain they had made and affirmed the district court's decision. The Court of Appeals determined that the district court's restitution order was valid under the Mandatory Victims Restitution Act (MVRA). View "USA v. Johnson" on Justia Law

In the case of Wages and White Lion Investments, L.L.C., doing business as Triton Distribution; Vapetasia, L.L.C., versus the Food & Drug Administration, the court found that the FDA acted arbitrarily and capriciously in its denial of Premarket Tobacco Product Applications (PMTAs) for flavored e-cigarette products.The petitioners, Triton Distribution and Vapetasia, are manufacturers of flavored e-cigarette liquids. They filed PMTAs for their products, as required by the Family Smoking Prevention and Tobacco Control Act, which prohibits the sale of any “new tobacco product” without authorization from the FDA. The FDA, after issuing detailed guidance on the information it required for approval of e-cigarette products, subsequently denied all flavored e-cigarette applications, including those of the petitioners, on the grounds that they failed to predict new testing requirements imposed by the FDA without notice.The court found that the FDA had failed to provide the manufacturers with fair notice of the rules, had not acknowledged or explained its change in position, and had ignored the reasonable and serious reliance interests that manufacturers had in the pre-denial guidance. Furthermore, the FDA attempted to cover up its mistakes with post hoc justifications at oral argument.As a result, the court granted the petitions for review, set aside the FDA's marketing denial orders, and remanded the matters to the FDA. The court rejected FDA's argument that even if it arbitrarily and capriciously denied petitioners’ applications, that error was harmless, stating that the harmless error doctrine is narrow and does not apply to discretionary administrative decisions. The court also rejected FDA's contention that it gave manufacturers fair notice of their obligations to perform long-term scientific studies in its pre-denial guidance documents. View "Wages and White Lion Invest v. FDA" on Justia Law

In a case involving the State of Texas, the American Association of Pro-Life Obstetricians & Gynecologists, and the Christian Medical & Dental Associations as plaintiffs, and the United States Department of Health and Human Services (HHS), its Secretary Xavier Becerra, the Centers for Medicare and Medicaid Services (CMS), and other officials as defendants, the United States Court of Appeals for the Fifth Circuit affirmed the district court's decision. The plaintiffs challenged HHS's guidance on the Emergency Medical Treatment and Active Labor Act (EMTALA), which they alleged mandated providers to perform elective abortions beyond HHS's authority and contrary to state law. The plaintiffs sought to enjoin the enforcement of this guidance. The district court granted the injunction within Texas or against any member of a plaintiff organization, and HHS appealed.The Court of Appeals held that the HHS guidance constituted a final agency action as it binds HHS to a particular legal position and has clear legal consequences should a physician or hospital violate it. The court found that HHS's guidance exceeds the statutory language of EMTALA, which does not mandate any specific type of medical treatment, let alone abortion care. The court also held that HHS was required to subject the guidance to notice and comment as it "establishes or changes a substantive legal standard." The court affirmed the injunction, finding it not overbroad, but rather tailored based on the parties, issues, and evidence before it. View "Texas v. Becerra" on Justia Law

A group of Doctors sued the FDA and the Department of Health and Human Services (together, the “Agencies”), claiming an FDA ad intended to deter people from off-label use of ivermectin to treat COVID-19. Each Doctor says that FDA’s messaging interfered with their own individual medical practice.The Doctors argue that FDA’s ad and similar public statements violated FDA’s enabling act (“Act”) and the Administrative Procedure Act (“APA”). The district court held that sovereign immunity protects the Agencies and the Officials, and it dismissed the suit. The Fifth Circuit reversed.The Fifth Circuit held that the Doctors can use the APA to bypass sovereign immunity and assert their ultra vires claims against the Agencies and the Officials. The ad was plausibly agency action, because it publicly announced the general principle that consumers should not use ivermectin to treat the coronavirus, and the Doctors fall within the Act’s zone of interests.The Doctors’ pure APA claim cannot go forward because the ad does not determine legal rights and thus lacks the finality. However, the Fifth Circuit held that the Doctors’ first theory was enough to allow this suit to proceed. View "Apter v. Dept of Health & Human Svc" on Justia Law