United States District Court, S.D. Indiana, Indianapolis Division
ORDER ON DEFENDANTS' MOTION TO DISMISS COUNTS 3,
13, AND 14 THROUGH 22 OF THE INDICTMENT
WALTON PRATT, JUDGE UNITED STATES DISTRICT COURT.
matter is before the Court on a Motion to Dismiss Counts 3,
13, and 14 through 22 of the Indictment pursuant to Federal
Rule of Criminal Procedure 12(b)(3)(B), filed jointly by
Defendants James Burkhart (“Burkhart”), Daniel
Benson (“Benson”), Steven Ganote
(“Ganote”), and Joshua Burkhart a/k/a Justin
Barnes (“Barnes”) (collectively,
“Defendants”) (Filing No. 67). In a thirty-two
count Indictment, the Defendants are charged with violating
18 U.S.C. § 1349 (conspiracy to commit mail, wire, and
health care fraud), 18 U.S.C. §§ 1341 and 1343
(mail and wire fraud), 18 U.S.C. § 371 and 42 U.S.C.
§ 1320a-7b(b) (conspiracy to violate anti-kickback
statute), and 18 U.S.C. §§ 1956(a)(1)(B)(i) and
1957 (money laundering). The Defendants ask the Court to
dismiss Count 3-Wire Fraud, Count 13-Conspiracy to Violate
the Anti-Kickback Statute, and Counts 14 through 22-Money
Laundering, because the allegations for these Counts are not
plain, concise, or definitive. For the following reasons, the
Court DENIES the Defendants' Motion to
Rule of Criminal Procedure 12(b)(3)(B) allows a defendant to
challenge the legal sufficiency of an indictment or
information for lack of specificity or failure to state an
offense, among other things. Rule 12(b)(3)(B) provides an
avenue for defendants to seek dismissal of the indictment or
dismissal of specific criminal counts. “Indictments are
reviewed on a practical basis and in their entirety, rather
than in a hyper-technical manner.” United States v.
Smith, 230 F.3d 300, 305 (7th Cir. 2000) (citation and
quotation marks omitted). “An indictment is reviewed on
its face, regardless of the strength or weakness of the
government's case.” United States v.
White, 610 F.3d 956, 958 (7th Cir. 2010). The
allegations in an indictment are accepted as true. United
States v. Moore, 563 F.3d 583, 586 (7th Cir. 2009).
indictment “that ‘tracks' the words of a
statute to state the elements of the crime is generally
acceptable, and while there must be enough factual
particulars so the defendant is aware of the specific conduct
at issue, the presence or absence of any particular fact is
not dispositive.” White, 610 F.3d at 958-59.
An indictment is legally sufficient if it (1) states all the
elements of the crime charged, (2) adequately informs the
defendant of the nature of the charges against him so that he
may prepare a defense, and (3) allows the defendant to assert
the judgment as a bar to future prosecutions for the same
offense. Smith, 230 F.3d at 305. To successfully
challenge the sufficiency of an indictment, a defendant must
demonstrate that the indictment does not satisfy one or more
of these three requirements and that he will suffer prejudice
from the alleged deficiency. United States v.
Dooley, 578 F.3d 582, 589-90 (7th Cir. 2009). “The
test for validity is not whether the indictment could have
been framed in a more satisfactory manner, but whether it
conforms to minimal constitutional standards.”
United States v. Hausmann, 345 F.3d 952, 955 (7th
Cir. 2003) (citation and quotation marks omitted).
Defendants argue that Counts 3, 13, and 14 through 22 of the
Indictment “fall far short of pinning down the specific
conduct at issue” to adequately inform them of the
nature of the charges against them to allow them to prepare a
defense (Filing No. 67 at 2). They explain Criminal Rule
7(c)(1) requires that an “indictment or information
must [include] a plain, concise, and definite written
statement of the essential facts constituting the offense
charged.” Id. (quoting F.R.C.P.
7(c)(1)). The Defendants note that they have the “right
to be informed of the charges against [them] and [the] right
to be free from conviction without notice and without having
meaningful opportunity to defend.” United States v.
Vaughn, 722 F.3d 918, 925 (7th Cir. 2013). They contend
that Counts 3, 13, and 14 through 22 lack sufficient factual
information to allow them to prepare for trial and to assert
that the results of the trial in this case bar future
prosecution for the same conduct. Asserting that these Counts
are not plain, concise, or definitive, the Defendants argue
that the Court must dismiss them.
response the Government asserts the Indictment is legally
proper and sufficiently detailed to inform the Defendants of
the charges against them, and their argument to the contrary
are meritless. The Government argues that the Defendants have
acknowledged in previous motions to continue that they
recognize “the nature and extent of the charges,
” (Filing No. 51 at 4), and they have been
“active in gathering documentary evidence from numerous
record holders for use in their defense, ” (Filing No.
60 at 4), thereby undermining the Defendants' argument
that they don't understand the charges and cannot prepare
a defense. The Government contends it has gone “above
and beyond its obligations” in discovery, which has
assisted the Defendants in preparing their defense (Filing
No. 71 at 1-2).
Defendants assert that Count 3 (wire fraud) against Burkhart
is fatally flawed because it is based on an alleged
interstate telephone conversation between Burkhart and David
Mazanowski (“Mazanowski”) at a time when
Mazanowski was cooperating with the Government's
investigation. To prove a charge of wire fraud, it must be
shown that the wire communication was “in
furtherance” of the scheme, citing United States v.
Weimert, 819 F.3d 351, 355 (7th Cir. 2016). Pointing to
United States v. Tanner, 628 F.3d 890, 906 (7th Cir.
2010) and United States v. Villasenor, 664 F.3d 673,
682 (7th Cir. 2011), The Defendants argue that a person
cannot conspire with an individual who is cooperating with
the Government, and a statement by an individual cooperating
with the Government is not a statement by a conspirator.
“Because the cooperating individual is not a
conspirator, when cooperating with the government, statements
by the cooperating individual are not in furtherance of the
conspiracy.” (Filing No. 67 at 3.) Specifically, the
Defendants assert that, because Mazanowski was cooperating
with the Government in August 2015, the alleged telephone
conversation between he and Burkhart could not have been in
furtherance of any scheme and cannot support a wire fraud
charge. They assert this is especially true because
Mazanowski initiated the alleged telephone call at the
Government's request and under its guidance.
Government contends that this argument is based on the false
premise that a wire communication with a government
cooperator cannot support a wire fraud charge. The Government
points out that Count 3 charges wire fraud, not conspiracy,
and the Defendants have incorrectly conflated conspiracy with
wire fraud, so their conspiracy related cases upon which they
rely are inapposite.
or telephone calls made or induced by government agents can
support a mail or wire fraud conviction.” United
States v. Keats, 937 F.2d 58, 64 (2d Cir. 1991); see
also United States v. Anderson, 809 F.2d 1281, 1287-88
(7th Cir. 1987) (rejecting argument that a mailing initiated
by government informant could not stand as the basis for a
mail fraud conviction). Additionally, “courts have
flatly rejected the argument that the use of a government
agent in a telephone call with the defendant makes the
offense of wire fraud legally impossible.” United
States v. Scully, 170 F.Supp.3d 439, 461-62 (E.D.N.Y.
2016) (citing United States v. Abdallah, 840
F.Supp.2d 584, 608 (E.D.N.Y. 2012); United States v.
Hammond, 598 F.2d 1008, 1010 (5th Cir. 1979); United
States v. Sanders, 893 F.2d 133, 138 (7th Cir. 1990)).
The Court agrees that the Defendants' argument is legally
wire fraud statute, 18 U.S.C. § 1343, requires that a
devised or intend[ed] to devise any scheme or artifice to
defraud, or for obtaining money or property by means of false
or fraudulent pretenses . . . [and] transmit[ed] or cause[d]
to be transmitted by means of wire . . . communication in
interstate or foreign commerce, any writings, signs, signals,