United States v. Salomon E. Melgen
967 F.3d 1250
11th Cir.2020Background
- Salomon Melgen, an ophthalmologist, was indicted on 76 counts alleging a multi-year scheme to defraud Medicare by over-diagnosing wet ARMD and billing for unnecessary treatments; after multiplicity dismissals he was convicted on 67 counts.
- Trial evidence showed an unusually high rate of wet-ARMD diagnoses (including among African‑American patients), heavy use of expensive Lucentis injections (≈$2,000/vial) and rare use of cheaper Avastin, and use of multi‑dosing from single vials that produced large reimbursement windfalls.
- The government introduced Rule 1006 summary charts comparing Melgen’s billing to selected retinal specialists (criteria: ≥500 injections 2008–2013, ≥2,000 Medicare patients, billed each year); an FBI analyst who prepared the charts testified.
- Melgen sought a materiality instruction modeled on Escobar; the court instead gave the Eleventh Circuit pattern instruction. He also moved to exclude the charts, challenged various evidentiary rulings, sought a new trial under Brady/Rule 33, and contested loss calculation at sentencing.
- The jury convicted; district court sentenced Melgen to 204 months (below Guidelines) and ordered ~$53M restitution. The Eleventh Circuit affirmed in all respects.
Issues
| Issue | Plaintiff's Argument (Melgen) | Defendant's Argument (Government) | Held |
|---|---|---|---|
| Materiality jury instruction | Escobar language (focus on effect on recipient’s likely/actual behavior) required | Pattern Eleventh Cir. objective instruction was proper for criminal fraud | Denied change; pattern instruction correct; any error harmless |
| Admission of summary charts (Rule 1006 / hearsay / Confrontation / Rule 702) | Charts were inadmissible hearsay/testimonial and required a statistical/medical expert | Charts were proper Rule 1006 summaries from admissible Medicare business records; preparer testified and government experts supported comparator criteria | Admission affirmed; no Confrontation Clause violation; no Rule 702 requirement |
| Evidence of multi‑dosing Lucentis (profit motive) | Multi‑dosing was irrelevant or unduly prejudicial | Multi‑dosing showed motive (substantial Medicare reimbursement windfall) and was probative | Admission proper; probative of motive |
| False testimony by defense witnesses re: surgery (mistrial/new trial) | Witnesses’ later-discredited testimony required mistrial or new trial | District court’s prompt curative instruction cured any prejudice | Denial of mistrial affirmed; instruction sufficient |
| Statistical sample / representativeness of patient file sample | Sample was not statistically random/representative; jury should be told | Court instructed jury that sample was random but not statistically guaranteed; sampling evidence supported use | No error; jury instruction and sampling evidence adequate |
| Brady / Rule 33 new‑trial claim | Government withheld favorable evidence (e.g., statement by Dr. Berger) that would have changed outcome | Evidence was not newly undiscoverable or material; mostly impeachment/obtainable via diligence | Denial affirmed; Brady not shown and Rule 33 relief inappropriate (impeachment only) |
| Loss calculation / sentence reasonableness | District court erred in loss methodology, inclusion of billed amounts, and failure to credit repayments; sentence substantively unreasonable | Loss based on representative sample and prima facie aggregate fraudulent bills; court reasonably estimated loss and varied downward on sentence | Loss finding and 204‑month sentence affirmed as not clearly erroneous or unreasonable |
Key Cases Cited
- Universal Health Servs., Inc. v. United States ex rel. Escobar, 136 S. Ct. 1989 (Sup. Ct. 2016) (materiality standard in FCA implied‑certification context)
- Kungys v. United States, 485 U.S. 759 (Sup. Ct. 1988) (objective "capable of influencing" materiality language)
- United States v. Henderson, 893 F.3d 1338 (11th Cir. 2018) (application of Eleventh Circuit materiality instruction)
- United States v. Richardson, 233 F.3d 1285 (11th Cir. 2000) (Rule 1006 summaries of voluminous records)
- Crawford v. Washington, 541 U.S. 36 (Sup. Ct. 2004) (Confrontation Clause testimonial evidence framework)
- Peat, Inc. v. Vanguard Research, Inc., 378 F.3d 1154 (11th Cir. 2004) (Rule 1006 cannot admit otherwise inadmissible evidence)
- United States v. Irey, 612 F.3d 1160 (11th Cir. 2010) (abuse‑of‑discretion review for sentencing reasonableness)