United States v. Otuonye, 995 F.3d 1191

Background

Ebube Otuonye was the pharmacist-owner of Neighborhood Pharmacy in Wichita; he filled a sudden increase of controlled-substance prescriptions written by Dr. Steven Henson beginning October 2014.
DEA investigation found red flags: high opioid dosages, dangerous opioid–benzodiazepine combinations, patients traveling long distances, cash payments, coordination among patients, and a notecard at Henson’s home referencing "NEIGHBORHOOD PHARMACY – 20%."
Neighborhood had a written “3:1 Policy” requiring three non-controlled prescriptions per controlled prescription; Otuonye solicited non-narcotic prescriptions from Henson to meet that ratio.
Financial and operational evidence: Neighborhood’s volume and profits rose while Henson was referring patients; Otuonye charged higher prices for Henson patients; K‑TRACS checks were rarely performed.
Indictment: conspiracy to distribute controlled substances (21 U.S.C. § 846), unlawful distribution (21 U.S.C. § 841 and 18 U.S.C. § 2), and Medicare/Medicaid fraud (18 U.S.C. § 1347). A jury convicted Otuonye on all four counts and the court sentenced him to 150 months.
On appeal Otuonye challenged several evidentiary rulings, sufficiency of the evidence for all counts, and the district court’s sentencing‑guideline calculations; the Tenth Circuit affirmed.

Issues

Issue	Government's Argument	Otuonye's Argument	Held
Admissibility of Dr. Henson co‑conspirator statements (Rule 801(d)(2)(E))	Statements were made during and in furtherance of a conspiracy; independent evidence (3:1 sign, revenue/volume spike, voicemail requesting non‑narcotics) links Otuonye to conspiracy.	The Government failed to prove a conspiracy or Otuonye’s knowledge of Henson’s prescribing practices; admission was erroneous.	Court found no clear error in the James‑hearing factual findings and affirmed admission.
Confrontation Clause challenge to patients’ text messages	Texts are non‑testimonial and thus not Crawford‑protected; defense failed to preserve a Confrontation Clause objection.	Texts were admitted without cross‑examination and thus violated the Sixth Amendment.	Waived for failure to preserve; alternatively texts were non‑testimonial so Confrontation Clause did not apply.
Sufficiency of the evidence for all four counts (conspiracy, distribution, Medicare/Medicaid fraud)	Circumstantial and direct evidence (red flags, willful blindness/deliberate ignorance, K‑TRACS failure, financial/reimbursement records) supported each element.	Evidence was insufficient, especially as to knowledge and legitimacy of prescriptions; Government did not identify which prescriptions lacked medical purpose.	Viewing evidence in Government’s favor, a reasonable jury could convict on all counts; convictions affirmed.
Sentencing‑guidelines calculation	Sentencing findings were supported by the record; Otuonye did not preserve a Rule 32 objection to the court’s failure to rule on contested PSR matters and conceded at argument.	District court miscalculated guidelines by treating all Henson prescriptions as lacking medical purpose.	Issue forfeited by failure to secure a Rule 32 ruling and not argued for plain error; sentencing challenge waived.

Key Cases Cited

United States v. Lovern, 590 F.3d 1095 (10th Cir. 2009) (pharmacist violates CSA when dispensing inconsistent with usual course of medical practice)
Bourjaily v. United States, 483 U.S. 171 (1987) (court may examine hearsay statements when determining coconspirator exception foundations)
Anderson v. City of Bessemer City, 470 U.S. 564 (1985) (clear‑error standard for factual findings)
Crawford v. Washington, 541 U.S. 36 (2004) (Confrontation Clause applies to testimonial hearsay)
United States v. Alcorta, 853 F.3d 1123 (10th Cir. 2017) (requirements for Rule 801(d)(2)(E) coconspirator exception)
United States v. Keck, 643 F.3d 789 (10th Cir. 2011) (test for whether statements are testimonial for Confrontation Clause)
United States v. Rufai, 732 F.3d 1175 (10th Cir. 2013) (elements of health‑care fraud conviction under 18 U.S.C. § 1347)
United States v. Wagner, 951 F.3d 1232 (10th Cir. 2020) (standard of review for sufficiency of the evidence)
United States v. Stein, 985 F.3d 1254 (10th Cir. 2021) (James‑hearing discussion and preferred procedure)