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United States v. Shorter

United States District Court, N.D. Indiana, South Bend Division

December 11, 2018




         Defendant Wanda C. Shorter was convicted by a jury of committing health care fraud (Count 1) and aggravated identity theft (Counts 2-4).[1] She was sentenced to seventy-five months of imprisonment (which represented the low end of the applicable guideline range)[2] and two years of supervised release. Shorter was also ordered to pay restitution to Indiana Medicaid in the agreed amount of $1, 340, 284.32. On appeal, Shorter challenged in relevant part the sufficiency of the evidence as to Counts 2-4, but the Seventh Circuit rejected this argument because “the government submitted a substantial amount of evidence to support the convictions for Counts 2-4.” United States v. Shorter, 874 F.3d 969, 977-78 (7th Cir. 2017).

         Shorter now seeks to vacate her convictions and sentence under 28 U.S.C. § 2255. She argues that her attorney, Mr. Jay Stevens, was ineffective during trial for failing to object to the admission of the government's summary Exhibits 35 and 40. Shorter also alleges that Mr. Stevens was ineffective during sentencing for: (1) failing to object to her receipt of a two-level enhancement under guideline § 3B1.3 for abusing a position of trust; and (2) failing to advise her of the supervised release conditions proposed by the presentence investigation report [DE 84, hereinafter, “PSR”] in paragraphs 89-99.

         For the following reasons, the Court finds that Shorter is not entitled to relief and that no hearing is required on these claims, so it denies the petition. Lafuente v. United States, 617 F.3d 944, 946 (7th Cir. 2010) (“A hearing, though, is not required when ‘the files and records of the case conclusively show that the prisoner is entitled to no relief'”) (quoting 28 U.S.C. § 2255(b)).


         In early 2011, Shorter, already a licensed nurse, formed Empowerment Non-Emergency Medical Transportation, Inc. to provide transportation services to Medicaid clients. In April 2011, Shorter began submitting invoices for Empowerment's services. Indiana Medicaid provides reimbursements for health-related transportation services to eligible patients. The provider of those services agrees to follow Medicaid's billing policies and to seek reimbursement for only medically necessary and truly rendered services. To ensure compliance, transportation providers must submit bills by using a unique Medicaid provider identification number and must maintain trip tickets that include the recipient's name and identification number, date of transport, type of services rendered, whether it was one-way or round trip, and the mileage driven. Each type of service is assigned a Medicaid code used for reimbursement.[3] The service provider submits the applicable codes to Medicaid, which reimburses according to set rates specific to the type of service provided. For instance, Medicaid reimburses twice as much if the patient is wheelchair-bound, and it provides additional reimbursement without prior authorization when an attendant also rides or when rides are more than twenty but fewer than one hundred miles round-trip. Empowerment billed and received Medicaid reimbursements using these codes until early 2014.

         To prove that Shorter was guilty of the charges, the government submitted the following evidence, as summarized by the Seventh Circuit on Shorter's direct appeal:

To prove the allegations in Count 1, the government submitted evidence of: (1) Shorter's personal involvement in Empowerment's billing practices; (2) the results of a September 2013 Indiana Attorney General Investigation into Empowerment's billing practices; (3) [the results of] an October 2013 FBI search [and seizure] of Empowerment's records; and (4) the experiences of Empowerment employees and of clients who used its services. As for Shorter's personal involvement, an FBI agent testified that Shorter confirmed during an interview her ownership of Empowerment, as well as her training and comfort with Medicaid billing. Shorter also told the agent that her aunt, Annette Gates, did some of Empowerment's Medicaid reimbursement requests between April 2012 and October 2013. Moreover, there was substantial evidence that Shorter personally trained Aunt Annette and a cousin, Lakesha Gates, on how to prepare Medicaid bills.
Specifically, both Annette and Lakesha testified that: (1) they submitted bills for Medicaid reimbursement in accordance with Shorter's instructions; (2) they had no knowledge about the Indiana Medicaid billing process before beginning work for Empowerment; and (3) they received no formal training beyond Shorter's instructions. They both further testified that Shorter taught them to use the same four codes for every trip: transport of a nonambulatory patient, when another client is already in the vehicle, with an attendant and more than 20 miles round-trip.
Multiple agents involved in the Indiana Attorney General's September 2013 investigation also testified to arranging for transportation services with Empowerment using fake names [like David Holtcamp, Jennifer Jones, and Shayna Lawson] but real Medicaid identification numbers. Each agent arranged for and took one-way trips without use of a wheelchair or presence of an attendant. Nevertheless, Empowerment billed each of these transports as round-trip for a wheelchair-bound client with an attendant. Similarly, there was testimony that trips of 3.4 miles and 4.2 miles were billed by Empowerment for 77 miles and 40 miles, respectively. An agent further testified that despite cancelling a trip, Empowerment later billed for the 40-mile transport of a wheelchair-bound client with an attendant. Finally, the agents testified that Empowerment submitted bills for their transport in June, July, and August 2013, well before they began requesting transportation. [Even more so, false billings were submitted by Empowerment even after the execution of the warrant in late October 2013].
As further proof of Count 1, twelve former clients and three former drivers testified about their actual experiences with Empowerment. This testimony was also inconsistent with Empowerment's actual billings for those same transports as reflected in government summary exhibits. Among other things, these exhibits showed that Empowerment coded transports to claim a wheelchair-bound patient, round-trips, and attendant trips, while only one client, Chitika Cox, testified that she used a wheelchair, and then only for one week at the end of 2013. Clients further testified that their trips with Empowerment were often one-way, not round-trips as coded, and only two of the twelve clients testified to using an attendant.[] This client testimony was confirmed by former Empowerment drivers. For example, one former driver testified that in two months driving for Empowerment, she had three to five wheelchair patients and one patient who needed an attendant. A second driver testified that between five and ten percent of her riders needed an attendant, while a third driver testified that attendants were not frequently present during trips. Yet for each trip, defendants submitted reimbursement requests seeking compensation for these additional services.
To prove Counts 2-4, the government submitted additional testimony and documentary evidence with respect to the “C.C.” references in the indictment, including that “C.C.” stood for Cassamdra Cook in Count 2, and for Chitika Cox in Counts 3 and 4. Without objection, the government also submitted Exhibits 18 and 20, which included Empowerment's trip tickets from Cook and Cox trips, respectively, as well as Exhibits 35 and 40, which were summary charts, respectively entitled “Empowerment's Billings for Chitika Cox” and “Empowerment's Billings for Casamdra[sic] Cook.”
At trial, Chitika Cox acknowledged using Empowerment to transport her to dialysis appointments three times a week, but testified that except for one week at the end of 2013, she never used a wheelchair, and she never traveled with an attendant. For five of her scheduled trips during the period that Empowerment billed Indiana Medicaid for this transport, Cox cancelled altogether, and Empowerment did not drive her to dialysis. Specifically, Empowerment's May 6, 17, 22, and June 10 and 19, 2013, trip tickets showed that Cox cancelled, and her medical records confirm that she did not appear for her medical appointment on those dates. However, the government submitted evidence that Empowerment billed each of those dates as round-trip, wheelchair trips with an attendant. Similarly, the trip tickets from May 1, 10, 29 and June 5, 2013, show that Cox either did not appear or did not list any mileage, but Empowerment billed those trips as round-trip, wheelchair transports as well.
In addition, Cook testified that she used Empowerment on a regular basis for transport to a standing appointment on Tuesdays at 5 p.m., but that she did not use a wheelchair [or need an attendant]. Because her mother would always pick her up, Cook also testified that these Tuesday trips were always one-way. Nevertheless, Empowerment billed two of these appointments as wheelchair trips on the wrong dates, with Cook as both a primary and secondary passenger.

United States v. Shorter, 874 F.3d 969, 972-73 (7th Cir. 2017). For her part, Shorter's defense was emphasized through cross-examination of the witnesses where Mr. Stevens attempted to convey that Shorter denied being responsible for Empowerment's billing errors and for the drivers' failure to submit adequately documented trip tickets. Despite this, the jury convicted Shorter on all counts.

         At sentencing, Shorter admitted under oath that she had received and reviewed a copy of the PSR, which included the proposed conditions of supervised release along with their justifications. She also acknowledged that she had discussed these matters with Mr. Stevens. Mr. Stevens lodged a single objection to the PSR with respect to the loss amount and successfully obtained a two-level deduction from the sixteen-level enhancement proposed by the PSR. Shorter also received uncontested two-level enhancements for defrauding a government health care program of over one million dollars and for abusing a position of public trust. The Court then rejected Mr. Stevens' request pursuant to 18 U.S.C. § 3553 for imposition of a below guideline sentence; and instead, the Court imposed a sentence at the low end of the applicable guideline range. Shorter unsuccessfully appealed her conviction and then timely filed a motion to vacate her convictions and sentence under 28 U.S.C. § 2255. Her motion has been fully briefed and the Court GRANTS her unopposed request to supplement her original motion [DE 134].


         Section 2255(a) of Title 28 provides that a federal prisoner “claiming the right to be released upon the ground that the sentence was imposed in violation of the Constitution or laws of the United States . . . may move the court which imposed the sentence to vacate, set aside or correct the sentence.” 28 U.S.C. § 2255(a). The Seventh Circuit has recognized that § 2255 relief is appropriate only for “an error of law that is jurisdictional, constitutional, or constitutes a fundamental defect which inherently results in a complete miscarriage of justice.” Harris v. United States, 366 F.3d 593, 594 (7th Cir. 2004). Relief under § 2255 is extraordinary because it seeks to reopen the criminal process to a person who has already had an opportunity of full process. Almonacid v. United States, 476 F.3d 518, 521 (7th Cir. 2007) (citing Kafo v. United States, 467 F.3d 1063, 1068 (7th Cir. 2006)).


         Shorter offers three grounds in support of her motion which rely only on her sworn statements. First, she argues that government's summary Exhibits 35 and 40 are inaccurate because the underlying billings or invoices (which Shorter has not provided; indeed, has not even identified) would show that Medicaid was never billed by Empowerment for transportation services; and therefore, Mr. Stevens ought to have objected to their admission at trial. Second, Shorter alleges that she should not have received a two-level enhancement for abusing a position of trust; and therefore, Mr. Stevens ought to have objected to application of the enhancement at sentencing. Third, Shorter contends that Mr. Stevens failed to warn her that the Court intended to impose overly broad and inapplicable supervised release conditions; and therefore, Mr. Stevens should not have waived the Court's reading of those conditions at sentencing. Shorter makes each of these arguments through the lens of an ineffective-assistance-of-counsel claim.

         The Sixth Amendment provides that “[i]n all criminal prosecutions, the accused shall enjoy the right . . . to have the Assistance of Counsel for his defence.” U.S. Const. amend. VI. To prevail on a claim of ineffective assistance of counsel, a defendant must show: (1) that her counsel's performance was deficient, meaning that it fell below an objective standard of reasonableness; and (2) that she was prejudiced by the deficiencies in her counsel's performance, meaning that there is a reasonable probability that the results of the proceeding would have been different with effective representation. Strickland v. Washington, 466 U.S. 687 (1984). To demonstrate prejudice in the trial context, Shorter must show that trial counsel's conduct so undermined the proper functioning of the adversarial process that the trial cannot be relied on as having produced a just result. Cooper v. United States, 378 F.3d 638, 642 (7th Cir. 2004). In the sentencing context, a defendant must show that there is a reasonable probability that the results of the sentencing hearing would have been different but for the ineffective assistance. Fuller v. United States, 398 F.3d 644, 650 (7th Cir. 2005).

         A. Summary Exhibits 35 and 40

          Shorter contends she received ineffective assistance because her attorney failed to object to the admission of government Exhibits 35 and 40 (and instead, stipulated to their admission), despite knowledge that the underlying documents were not going to be identified by a testifying witness or admitted into evidence at trial. Exhibits 35 and 40 consist of charts that summarize Empowerment's Medicaid billings for Cassamdra Cook and Chitika Cox. Shorter alleges that these summary exhibits are inaccurate because the actual bills or invoices underlying Counts 2-4 were either (1) never sent to Medicaid; or, (2) if sent to Medicaid, then the bills were for medical services provided by physicians and not transportation services rendered by Empowerment (despite evidence of payment from Medicaid to Empowerment). Again, Shorter makes these contentions without further documentary proof or even specific reference to the documents.

         In response, the government submits the affidavit of Mr. Stevens who attests that the decision not to attack the underlying documents was a matter of trial strategy because the documentary evidence of erroneous billings was overwhelming [DE 131-1]. They also argue that Shorter authorized the stipulation. Thus, the trial strategy adopted was to let Exhibits 35 and 40 come into evidence without objection, while arguing that Shorter had no intention to defraud the government; rather, any errors were the result of confusion or were someone else's doing.

         Shorter retorts [DE 134] that she never agreed to the admission of these summary exhibits without questioning their authenticity and that Mr. Stevens should have conducted additional investigation into the underlying documents. She makes this argument even though she was present during the final pretrial conference ...

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