United States v. Zafar Mehmood, 19-1669

Background:

From 2006–2011 Mehmood and related companies ran a scheme submitting ~ $47.2M in Medicare claims (payments ~$40.5M) for purported in‑home therapy; jury convicted him of health‑care fraud, kickback conspiracy, money laundering, and obstruction.
On initial review this court affirmed convictions but vacated the sentence and remanded because the district court had treated the full gross billings as loss without adequately deducting any legitimate claims (Mehmood I).
On remand Mehmood sought a new trial based on two post‑trial forensic reports and scanner metadata allegedly showing inconsistencies among key document exhibits; the district court denied the motion as the evidence was not newly discovered and could have been obtained earlier.
At resentencing the district court found the fraud pervasive, treated aggregate gross billings as prima facie intended loss, then conservatively reduced billings from four indicted companies by 20%, resulting in an intended‑loss finding of $26,176,405 and a Guidelines enhancement; total sentence was varied down to 300 months; restitution ordered ~$20.8M.
This appeal challenges (1) the district court’s loss calculation and whether it followed this Court’s remand instructions, (2) the restitution order tied to that loss, and (3) the denial of the new‑trial motion; the Sixth Circuit affirmed in all respects.

Issues:

Issue	Government's Argument	Mehmood's Argument	Held
Proper methodology for loss calculation under U.S.S.G. § 2B1.1 in pervasive health‑care fraud	Gross aggregate billings constitute prima facie intended loss when fraud is pervasive; court may start with total and defendant must prove specific legitimate amounts to deduct	District court again erred by starting from gross billings and shifting burden to Mehmood; Mehmood I required government to prove which claims were fraudulent	Affirmed: court complied with remand, found pervasive fraud, properly used aggregate bills as prima facie evidence and required Mehmood to quantify legitimate billings to reduce loss
Whether evidence supported finding fraud continued through 2011 (affecting loss period)	Trial evidence and post‑raid materials showed continuous fraudulent operation through November 2011	Evidence of employee testimony ended 2008; Mehmood argued insufficiency to extend fraud through 2011	Affirmed: district court did not clearly err; photographs and seized materials supported continuity of scheme through 2011
Restitution amount tied to loss determination	Restitution mirrors validated loss calculation based on aggregate billings less deductions	Restitution is erroneous because loss was miscalculated	Affirmed: restitution upheld for same reasons loss calculation was upheld
Denial of new‑trial motion based on purportedly newly discovered forensic reports/metadata	Reports and scanner metadata were not newly discovered and could have been obtained pretrial with due diligence; exclusion of additional testimony not an abuse	Forensic reports show exhibits were not from the same source and scanner metadata was unavailable at trial; such evidence would likely produce acquittal	Affirmed: district court did not abuse discretion — evidence was not newly discovered and could have been sought earlier; refusal to receive additional testimony was proper

Key Cases Cited:

Gall v. United States, 552 U.S. 38 (establishes abuse‑of‑discretion standard for sentencing)
United States v. Ramer, 883 F.3d 659 (6th Cir. 2018) (standards for loss calculation review)
United States v. Washington, 715 F.3d 975 (6th Cir. 2013) (aggregate submitted bills as prima facie evidence where program was a sham)
United States v. Meda, 812 F.3d 502 (6th Cir. 2015) (aggregate billings acceptable where companies were entirely a fraud)
United States v. Mahmud, [citation="541 F. App'x 630"] (6th Cir. 2013) (defendant bears burden to prove specific legitimate reductions once government meets prima facie showing)
United States v. Lovett, [citation="764 F. App'x 450"] (6th Cir. 2019) (pervasive conspiracy supports using full billing amounts)
Mehmood v. United States (Mehmood I), [citation="742 F. App'x 928"] (6th Cir. 2018) (vacated sentence due to flawed loss analysis and remanded)
United States v. Dubrule, 822 F.3d 866 (6th Cir. 2016) (standards for newly discovered evidence in new‑trial motions)
Cavazos v. Smith, 565 U.S. 1 (2011) (deference to jury fact‑finding)