E. GRADY JOLLY, Circuit Judge:
Before the court are three former employees of a private medical practice who stand convicted for engaging in a conspiracy to fraudulently obtain large amounts of hydrocodone, a controlled dangerous substance. The conspiracy involved submission of fabricated prescriptions to local pharmacies and falsification of patient medical records to conceal the fraudulence of the prescriptions. Appellants were found guilty of various charges, including
Appellant Tandy McElwee ("Dr. McElwee") was an OB/GYN physician who maintained a practice in Bossier City, Louisiana. There he supervised 13 employees including his wife, Appellant Ava McElwee ("Mrs. McElwee"), a nurse practitioner, and Appellant Wendy Chriss ("Chriss"), a registered medical assistant. Dr. McElwee was authorized by the U.S. Drug Enforcement Administration ("DEA") to prescribe lawful controlled substances, but he did not have a license to dispense controlled substances from the State of Louisiana.
Over a period of years, employees of the medical practice employed a variety of fraudulent means to obtain hydrocodone medications including Lorcet, Lortab, Histussin HC, and Histinex HC, all of which are schedule III controlled dangerous substances. To effectuate this conspiracy, Dr. McElwee made available to his employees pre-signed prescription pads, which were used to request refills of these hydrocodone-containing drugs from various pharmacies. Trial testimony suggested that the atmosphere in Dr. McElwee's office was one that accepted and accommodated the daily use of hydrocodone.
The coconspirators were able to obtain large amounts of hydrocodone medication by submitting pre-signed "prescriptions" in the names of fictitious persons, other family members, and in one case, even a family dog. For example, Chriss ordered hydrocodone using names like Kathleen Benson (her middle and maiden name), Eddie Chriss (her husband), Ayden Chriss (her child), Kristina Randall (her sister), and Rochelle Petouski (an alias for her sister). Dr. McElwee secured hydrocodone for himself and others by having his medical assistant, Rebecca Sandifer, go to the pharmacy to pick up prescriptions in the names of Sandifer's children and her ex-husband. He also ordered prescriptions using the name of his dog "Brandi" and his daughter-in-law, Conchita McElwee. When questioned by a pharmacist, Dr. McElwee represented that "Brandi McElwee" was a patient under his care.
Dr. McElwee authorized Chriss to order hydrocodone via the Internet from Moore Medical, LLC, and he testified that he kept a large 500-count bottle in his office for personal use and gave another 500-count bottle to Chriss for use by office personnel or their family members. Although Mrs. McElwee's level of involvement in these schemes was disputed, many prescriptions—including for Lortab and Histussin HC—were filled out in her name, and she often retrieved the medications from the pharmacy. Another employee testified that she delivered prescriptions to Mrs. McElwee, and the jury apparently credited the trial testimony suggesting that Mrs. McElwee knew of and participated in the conspiracy.
Dr. McElwee's staff frequently submitted prescriptions to QVL Pharmacy (which was originally named "Safescript"). In June 2007, the Louisiana State Board of Medical Examiners ("LSBME") issued subpoenas to QVL and to Dr. McElwee's office for approximately 22 patient records, including requests for the patient records of Dr. McElwee's staff and for the family members and fictitious "patients" under whose names the prescriptions had been filled. An employee of QVL notified Chriss about the LSBME subpoenas and sent Chriss a fax containing the details of
Appellants were indicted along with five other codefendants in an 88-count indictment that included charges for conspiracy to obtain a controlled substance by fraud and conspiracy to possess with intent to distribute a controlled substance. Under a plea agreement, Chriss pleaded guilty to one count of conspiracy to possess with intent to distribute a controlled substance, in violation of 21 U.S.C. §§ 846 and 841(a)(1). A jury found Dr. McElwee guilty of one count of conspiracy to obtain a controlled substance by fraud, in violation of 21 U.S.C. §§ 846 and 843(a)(3); nineteen counts of obtaining a controlled substance by fraud, in violation of 21 U.S.C. § 843(a)(3) and 18 U.S.C. § 2; one count of conspiracy to possess with intent to distribute; nine counts of possession with intent to distribute a controlled dangerous substance, in violation of 21 U.S.C. § 841(a)(1) and 18 U.S.C. § 2; one count of providing false information in records required to be kept under Title 21, in violation of 21 U.S.C. § 843(a)(4)(A) and 18 U.S.C. § 2; and one count of health care fraud, in violation of 18 U.S.C. §§ 1347 and 2. The same jury found Mrs. McElwee guilty of one count of conspiracy to obtain a controlled substance by fraud and one count of obtaining or acquiring a controlled substance by fraud.
At sentencing, the district court adopted the factual findings of the Presentence Investigation Report ("PSR") with respect to Dr. McElwee and assessed an offense level of 20 and criminal history category of I. The court granted the Government's motion for an upward variance from the Sentencing Guidelines range of 33 to 41 months, noting that points had not been assessed for inclusion of false information in a record required to be kept, and that the 32,000 easily identifiable units of hydrocodone were "probably the tip of the iceberg." Considering his role and the nature of the offense, the court sentenced Dr. McElwee to a total of 60 months in prison and a $550,000 fine, up to $400,000 of which is to be paid jointly and severally with Mrs. McElwee.
Mrs. McElwee was assessed an offense level of 8 with a criminal history category of I, which yielded a Guidelines range of zero to six months. The court ultimately imposed a non-Guidelines sentence of 36 months of imprisonment and a $400,000
As to Chriss, the district court adopted the factual findings of the PSR and assessed an offense level of 16 with a criminal history category of I, imposing a 21-month sentence of imprisonment followed by three years of supervised release, which was at the bottom of the Guidelines range.
Dr. McElwee and Chriss timely appeal their sentences, while Mrs. McElwee appeals both her conviction and her sentence. We have jurisdiction under 28 U.S.C. § 1291.
At the core of Appellants' complaints on appeal are their challenges to the substantive reasonableness of their sentences. We review the reasonableness of a defendant's sentence for abuse of discretion. See Gall v. United States, 552 U.S. 38, 46, 51, 128 S.Ct. 586, 169 L.Ed.2d 445 (2007). We "first ensure that the district court committed no significant procedural error" and then analyze substantive reasonableness by considering "the totality of the circumstances, granting deference to the district court's determination of the appropriate sentence based on the § 3553(a) factors, and we may not reverse the district court's ruling just because we would have determined that an alternative sentence was appropriate." Id. at 51, 128 S.Ct. 586 (internal quotation marks, citations, and modifications omitted). We now turn to address the issues raised by the Appellants.
We first consider the claims of Dr. McElwee, who challenges the reasonableness of his prison sentence and the fine imposed by the district court.
Dr. McElwee first contests the length of the 60-month sentence imposed by the district court. We note, at the outset, that the district court did not commit any procedural error such as failure to calculate the Guidelines range or failure to consider the § 3553(a) factors.
18 U.S.C. § 3553(a)(1)-(2). Other considerations are "the kinds of sentences available," § 3553(a)(3); the Guidelines, § 3553(a)(4); "any pertinent policy statement" issued by the Sentencing Commission, § 3553(a)(5); "the need to avoid unwarranted sentence disparities,"
Dr. McElwee argues that the district court did not appropriately weigh all the relevant § 3553(a) factors. Specifically, he contends that the court did not give adequate weight to his lack of criminal history, that "there was no evidence of a widespread distribution network traced back to [his] office," and that Dr. McElwee's abuse of trust had already been factored into the PSR's Guidelines evaluation. He further argues that the district court's attempt to send a message to the medical profession unduly punished him for his "socioeconomic status."
After considering these arguments, we nevertheless conclude that the district court did not abuse its discretion. Although a 60-month sentence is a substantial deviation from the Guidelines range of 33 to 41 months, it is "commensurate with the individualized, case-specific reasons provided by the district court." United States v. Herrera-Garduno, 519 F.3d 526, 531 (5th Cir.2008). In justifying its decision, the district court observed that the Guidelines offense level did not take into account conduct such as the inclusion of false information in a record required to be kept, the fabrication and altering of patient medical charts, or health care fraud.
Dr. McElwee next challenges the $550,000 fine assessed by the district court. Although he leveled a general objection to his sentence, Dr. McElwee did not file a specific objection to the $550,000 fine at sentencing.
Dr. McElwee argues that the $550,000 fine is unreasonable because it far exceeds the $75,000 maximum for his offense level of 20, as suggested in the Guidelines. The PSR shows that Dr. McElwee's net worth is $119,477.80, with total debt of over $150,000. Although the PSR does not contain a recommendation regarding an appropriate fine amount, Dr. McElwee asserts that the PSR shows his "obvious inability . . . to pay anything close to" what was assessed, and that the district court erred by failing to make explicit factual findings justifying the deviation.
Dr. McElwee's argument is unavailing. Although the $550,000 fine is above the Guidelines range, the PSR reflects that Dr. McElwee has a monthly income of $22,240 through a personal disability policy, and that this policy will pay him at least $16,000 per month until his death.
As noted above, in granting the Government's motion for a non-Guidelines sentence, the district court explained that the Guidelines offense level did not take into account conduct such as the inclusion of false information in a record required to be kept, the fabrication and altering of patient medical charts, or health care fraud. Moreover, although the fine exceeds the Guidelines range, it is well within
We next turn to Mrs. McElwee, who contests both her conviction and her sentence. She disputes the sufficiency of the evidence for her conviction, the instructions given to the jury, and the reasonableness of her sentence.
Mrs. McElwee was convicted of conspiracy to obtain and of obtaining or acquiring a controlled substance by fraud. She appeals the district court's denial of her motion for judgment of acquittal, arguing that the evidence against her was constitutionally insufficient to support a conviction under Jackson v. Virginia, 443 U.S. 307, 99 S.Ct. 2781, 61 L.Ed.2d 560 (1979). "A challenge to the sufficiency of the evidence that is procedurally preserved, as this challenge was, is reviewed de novo." Diaz, 637 F.3d at 602. "Viewing all the evidence and drawing all inferences and credibility determinations in the light most favorable to the verdict, we determine whether a rational jury could have found that the evidence established the elements of the offense beyond a reasonable doubt." Id. (internal quotation marks and citations omitted). Mrs. McElwee asserts "that record-keeping in the office was admittedly poor, that Dr. McElwee admitted using his wife's name to get prescriptions for himself, that there was no evidence introduced that Ava McElwee's charts specifically were altered," and that the evidence supporting her role in altering patient records "was inconsistent and confusing."
As an initial matter, we note that many of the issues Mrs. McElwee raises involve credibility determinations that are decidedly matters for the jury. See United States v. Dadi, 235 F.3d 945, 951 (5th Cir.2000) ("The credibility of witnesses is a matter for the jury and its determinations demand deference."). Moreover, the district court clearly set forth the evidence supporting Mrs. McElwee's conviction on both the conspiracy and the fraudulent acquisition charges in its memorandum ruling on Mrs. McElwee's motion. Specifically, the court noted the existence of at least ten pharmacy signature logs purporting to show that Mrs. McElwee signed for hydrocodone prescriptions, the amounts of which were strikingly inconsistent with her own medical charts; evidence indicating that she had altered and falsified an exam note in the patient chart for Conchita McElwee; testimony from a codefendant suggesting that Mrs. McElwee believed Chriss was "going to save our ass with that book" (i.e., the falsified dispensary log book); and further testimony indicating that Mrs. McElwee told a codefendant to "slow down" the number of prescriptions being submitted to local pharmacies after she was alerted by a pharmacist to suspicious prescriptions emanating from Dr. McElwee's office. Given the volume of both direct and circumstantial evidence implicating Mrs. McElwee in the conduct for which she was convicted, the district court did not err in denying her motion for judgment of acquittal.
With respect to her claim of defective jury instructions: The district court instructed the jury that it could consider evidence of Mrs. McElwee's deliberate ignorance
Mrs. McElwee argues that the district court erred in giving a deliberate ignorance instruction because the evidence suggested "only that she was aware of isolated instances of misconduct by Chriss and that she attempted to correct the problem." We are unpersuaded. Although Mrs. McElwee claimed the conspiracy took place without her knowledge, evidence at trial showed otherwise—that Mrs. McElwee personally picked up a significant number of the hydrocodone prescriptions from local pharmacies, and that other employees delivered prescriptions to Mrs. McElwee. In addition, the prosecution elicited evidence that Mrs. McElwee took part in the fabrication and falsification of patient records, that she knew about invalid prescription orders and was fully aware of a fake dispensary log book created by Chriss. In the light of this evidence, we need not determine whether the deliberate ignorance instruction was error. There was substantial evidence of actual knowledge before the jury, such that even an erroneous instruction as to deliberate ignorance was harmless.
Mrs. McElwee further appeals the district court's denial of her request for a jury instruction that simple possession of a controlled dangerous substance, 21 U.S.C. § 844(a), is a responsive verdict to the offense of obtaining a controlled substance by fraud, 21 U.S.C. § 843(a)(3), because it is a lesser-included offense. "A defendant is entitled to a lesser-included-offense instruction if (1) the elements of the lesser offense are a subset of the elements of the charged offense and (2) the evidence at trial is such that a jury could rationally find the defendant guilty of the lesser offense yet acquit him of the greater." United States v. Finley, 477 F.3d 250, 255 (5th Cir.2007). "We review the district court's determination on the first prong of the above two-part test (whether the lesser offense is included in the greater offense) de novo . . . . We review the court's determination on the second prong (whether a jury could rationally acquit on the greater offense yet convict on the lesser) for abuse of discretion." Id. at 256 (internal citations omitted).
We turn finally to Mrs. McElwee's challenge to her sentence. Although Mrs. McElwee's Guidelines range was zero to six months, the district court sentenced her to 36 months in prison. We note, as a preliminary matter, that notwithstanding some confusion in the record as to whether the Government made a motion for a sentence exceeding the Guidelines range, the district court clearly imposed a non-Guidelines sentence in this case.
The focus of our inquiry is the reasonableness of the sentence in the light of the totality of the circumstances. In conducting this review, we begin by noting that the district court committed no significant procedural error. The district court "correctly calculated the Guidelines range, treated the Guidelines as advisory, considered the § 3553(a) factors, allowed both parties to present arguments as to what they believed the appropriate sentence should be, did not base [Mrs. McElwee's] sentence on clearly erroneous facts, and thoroughly documented its reasoning." Herrera-Garduno, 519 F.3d at 530 (citing Gall, 552 U.S. at 51-53, 128 S.Ct. 586).
We thus turn to the substantive reasonableness of Mrs. McElwee's sentence. "In reviewing a challenge to the length of a non-Guidelines sentence, we may `take the degree of variance into account and consider the extent of a deviation from the Guidelines.'" Herrera-Garduno, 519 F.3d at 530 (quoting Gall, 552 U.S. at 47, 128 S.Ct. 586). "The farther a sentence varies from the applicable Guideline sentence, the more compelling the justification based on factors in section 3553(a) must be." Smith, 440 F.3d at 707. "A non-Guideline sentence unreasonably fails to reflect the statutory sentencing factors where it (1) does not account for a factor that should have received significant weight, (2) gives significant weight to an irrelevant or improper factor, or (3) represents a clear error of judgment in balancing the sentencing factors." Id. at 708. We must, however, "give due deference to the district court's decision that the § 3553(a) factors, on a whole, justify the extent of the variance." Gall, 552 U.S. at 51, 128 S.Ct. 586. Furthermore, "[t]he fact that the appellate court might reasonably have concluded that a different sentence was appropriate is insufficient to justify reversal of the district court." Id.
Mrs. McElwee argues primarily that the district court improperly relied upon her marital relationship with Dr. McElwee as a basis for her level of involvement in the conspiracy. During the colloquy at sentencing and in the Statement of Reasons, the court did "note[] the heightened duties on behalf of [Mrs. McElwee], a licensed nurse practitioner and the spouse of the physician involved." Indeed, the court made several references to the spousal relationship in the course of the extensive sentencing colloquy, although the object in doing so was apparently to emphasize what Mrs. McElwee likely had knowledge of given her relationship to the conspiracy's "ringleader." We cannot conclude that the court's inferences about Mrs. McElwee's knowledge as the spouse of Dr. McElwee constitute error, particularly given the substantial other evidence—including her own statements to coconspirators, her falsification of an exam note in a patient chart, and her substantial involvement in retrieving hydrocodone prescriptions from pharmacies—indicating
The district court underscored that it was considering acquitted conduct and the testimony of other coconspirators in devising an appropriate sentence for Mrs. McElwee. He noted that the Guidelines are "woefully inadequate" in this case because they "do not appropriately capture the breadth, scope, and nature of the conspiracy for drug distribution." He further explained that, with respect to Mrs. McElwee's role in the conspiracy, "[t]he most telling part of it appears to be, to me, the drug dispensary notebook that was put together to show false entries, false medical records even; the use of the McElwees' dog, Brand[i], in prescriptions; the use of the daughter-in-law's name, Conchita McElwee, also in multiple forms . . . ." The record contains evidence connecting Mrs. McElwee to all of these aspects of the conspiracy. Under these facts, it is not our place to second-guess the district court's conclusion that Mrs. McElwee's culpability requires a significantly greater sentence than the Guidelines suggest.
Still, we are struck that Mrs. McElwee's 36-month prison sentence, although within the statutory maximum, is fully six times the maximum sentence suggested by the Guidelines. We emphasize that such variance demands thorough justification. Here, the district court did just that. The
In conclusion, it bears remarking that we have upheld substantial Guidelines deviations in other post-Booker cases where the district court based its upward variance on permissible, properly spelled-out considerations. See, e.g., United States v. Key, 599 F.3d 469, 475-76 (5th Cir.2010), cert. denied, ___ U.S. ___, 131 S.Ct. 997, 178 L.Ed.2d 832 (2011) (upholding sentence of 216 months where Guidelines maximum was 57 months); United States v. Smith, 417 F.3d 483, 492 (5th Cir.2005) (upholding sentence of 120 months where Guidelines maximum was 41 months); United States v. Saldana, 427 F.3d 298, 312-13 (5th Cir.2005) (upholding sentence four times the Guidelines maximum despite "misgivings about the length of th[e] sentence"). Thus, we hold that the district court did not abuse its discretion, and consequently we affirm Mrs. McElwee's non-Guidelines sentence.
Finally, we consider Wendy Chriss's three-part challenge to her sentence. Chriss was assessed an offense level of 16 with a criminal history category of I. The district court imposed a 21-month sentence of imprisonment followed by three years of supervised release. This sentence was at the bottom of the Guidelines range of 21 to 27 months.
Chriss first argues that the district court erred in denying her the benefit of the safety-valve adjustment under the Guidelines. The Guidelines provide that a defendant's offense level must be reduced by two levels if she meets five conditions, including the following relevant provision:
U.S.S.G. § 5C1.2(a); see id. § 2D1.1(b)(11). See also 18 U.S.C. § 3553(f). On appeal, the parties dispute whether Chriss met this fifth criterion for the safety-valve adjustment. We review a sentencing court's decision whether to apply the safety valve for clear error. See United States v. McCrimmon, 443 F.3d 454, 457 (5th Cir.2006). Chriss bears the burden of establishing that she is entitled to the adjustment. Id.
The Government argues that Chriss failed to truthfully debrief regarding several specific instances. For example, she denied ever selling hydrocodone to an individual named Trey Jacobe, but Jacobe testified to the contrary at trial. The Government further notes that Chriss was less than completely truthful about when she stopped working for Dr. McElwee.
Chriss further argues that the district court erred by denying her the benefit of a two-level reduction in her offense level, contending that she was only a minor participant in the conspiracy. The Guidelines provide for a two-level reduction "[i]f the defendant was a minor participant in any criminal activity." U.S.S.G. § 3B1.2(b). This reduction applies to a defendant "who is less culpable than most other participants, but whose role could not be described as minimal." Id. Application Note 5. "It is not enough that a defendant does less than other participants; in order to qualify as a minor participant, a defendant must have been peripheral to the advancement of the illicit activity." United States v. Villanueva, 408 F.3d 193, 204 (5th Cir.2005). Whether Chriss was a minor participant is a factual determination reviewed for clear error. Id. at 203.
Chriss argues that she was "clearly less culpable in the offense than others," but her only apparent support for this contention is that she operated at the instruction of Dr. McElwee, who "fed" her addiction. Chriss's argument is insufficient to demonstrate clear error, particularly in the light of her failure to address the district court's findings that she was the conduit through whom many of the hydrocodone pills were illegally obtained, and that she personally placed and signed for many of the orders using false prescriptions.
Finally, Chriss disputes the substantive reasonableness of her sentence. Again, we review the substantive reasonableness of a sentence for abuse of discretion, considering the totality of the circumstances and affording deference to the district court's application of the § 3553(a) factors. See Gall, 552 U.S. at 51, 128 S.Ct. 586; Diaz, 637 F.3d at 603. We start by noting that Chriss's 21-month sentence is at the bottom of the 21-to-27 month Guidelines range for her offense level of 16 and criminal history category of I. A sentence within the Guidelines range is presumptively reasonable. Diaz, 637 F.3d at 603. Nevertheless, Chriss asserts that her sentence is greater than necessary to achieve the goals set forth in § 3553(a).
Chriss submits that she is remorseful for her conduct; that she was addicted to hydrocodone at the time of the conspiracy and has sought treatment to overcome this addiction; that she does not have a history of criminal behavior; that she has two minor children who will be forever harmed by her incarceration; and that she has accepted responsibility and desires rehabilitation. These arguments will not rebut the presumption of reasonableness that we must attach to her Guidelines sentence. That presumption "is rebutted only upon a showing that the sentence does not account for a factor that should receive significant weight, it gives significant weight to an irrelevant or improper factor, or it represents a clear error of judgment in balancing sentencing factors." Diaz, 637 F.3d at 603 (internal quotation marks and citations omitted).
We conclude by summarizing our holdings in this case: With respect to Dr. McElwee, we affirm the 60-month sentence and the $550,000 fine imposed by the district court. As to Mrs. McElwee, we conclude that the evidence was sufficient to support her conviction, that the district court committed no error affecting her substantial rights in its issuance of instructions to the jury, and that the district court did not abuse its discretion in sentencing her to a 36-month term of imprisonment. Finally, we affirm Wendy Chriss's 21-month sentence, including the district court's denial of the safety-valve reduction and its refusal to apply a reduction for her role in the offense.
AFFIRMED.
U.S.S.G. § 5E1.2(d). Furthermore, "[t]he amount of the fine should always be sufficient to ensure that the fine, taken together with other sanctions imposed, is punitive." Id.
In the light of statements such as the foregoing, we do not understand the district court to have reached the factual conclusion that Dr. and Mrs. McElwee were in each other's presence at all times. On the contrary, the court's clear point is that given Mrs. McElwee's level of training as a nurse practitioner and her interaction with her husband at home as well as at the office, including during some surgical procedures, her position that she knew nothing about his Lortab addiction borders on the inconceivable. Again, her position must be viewed in the light of all the evidence incriminating Mrs. McElwee, and we owe substantial deference to the district court's conclusions.