Opinion
H043774
03-05-2018
THE PEOPLE, Plaintiff and Respondent, v. TRI MINH DO, Defendant and Appellant.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Santa Clara County Super. Ct. No. C1363940)
Defendant Tri Minh Do, a radiation oncologist, received a research grant to conduct clinical trials at the Santa Clara Valley Medical Center (VMC). He deposited more than $50,000 in grant funds into a personal account and used the money to pay for both research and personal expenses. A jury convicted defendant of misappropriating public funds in violation of Penal Code section 424, subdivision (a)(1). The trial court suspended imposition of sentence and ordered defendant to complete three years' formal probation and to pay $42,000 in restitution.
All further statutory references are to the Penal Code unless otherwise indicated.
Section 424, subdivision (a)(1) provides: "Each officer of this state, or of any county, city, town, or district of this state, and every other person charged with the receipt, safekeeping, transfer, or disbursement of public moneys, who . . . [¶] . . . [w]ithout authority of law, appropriates the same, or any portion thereof, to his or her own use, or to the use of another" is guilty of a crime.
On appeal, defendant's counsel filed an opening brief in which no issues are raised and asked this court to independently review the record under People v. Wende (1979) 25 Cal.3d 436. We notified defendant of his right to submit a written argument on his own behalf on appeal. He has not done so.
Based on our independent review of the record, we conclude that there are no arguable issues on appeal. As required by People v. Kelly (2006) 40 Cal.4th 106, 110, we will provide "a brief description of the facts and procedural history of the case, the crimes of which the defendant was convicted, and the punishment imposed." We will further include information about aspects of the trial court proceedings that might become relevant in future proceedings. (Ibid.)
I. BACKGROUND
A. Factual Background
VMC is owned and operated by Santa Clara County. Defendant started working at VMC as a radiation oncologist in 2002. He and Jeffrey Reese, M.D., a urologist, ran a joint urologic oncology clinic together at the medical center.
1. The Radiation Therapy Oncology Group Research Grant
In 2009, defendant began working to secure a Radiation Therapy Oncology Group (RTOG) research grant. RTOG research grants are funded by the National Cancer Institute and administered by the American College of Radiology. RTOG designs and directs numerous radiation oncology clinical trials. Medical institutions that are members of RTOG receive grant funds to participate in one or more of those clinical trials.
Defendant discussed pursuing the RTOG grant with Dr. Reese, both because Dr. Reese could assist in referring patients to the trial and because he had been involved in other research protocols at VMC. Dr. Reese recommended using the California Institute of Medical Research (CIMR) to administer the grant funds. While VMC can administer grant funds using a research grant trust fund account, Dr. Reese advised against it. According to defendant, Dr. Reese "felt the County would be too much of a bureaucracy to hold any grant funds." Dr. Reese confirmed that he recommended using CIMR because he had heard from colleagues that going through VMC was "cumbersome." Alfonso Banuelos, M.D., VMC's Chief Medical Officer from 2002 until his retirement in May 2012, testified that the majority of research grants at VMC are administered by third parties, like CIMR, because VMC lacks the necessary infrastructure.
Generally, when CIMR administers grant funds, the funds go directly to CIMR from the grantor. CIMR then safekeeps the funds and disburses them for approved study-related expenses at the request of the physician researcher, referred to as the "principal investigator."
In March 2011, defendant and Dr. Reese met with Deputy County Counsel Jennifer Sprinkles and VMC's Research Contracts and Administrative Manager, Kevin Hutchcroft, to discuss the possible RTOG grant. In July 2011, the County doing business as VMC and the American College of Radiology executed an agreement entitled "Radiation Therapy Oncology Group Member Agreement" (VMC-RTOG Member Agreement). The VMC-RTOG Member Agreement set forth the terms and conditions under which "the Institution"—VMC—would "be eligible for reimbursement for participation in RTOG" clinical trials. The VMC-RTOG Member Agreement further provided that VMC would assign defendant as the principal investigator. Defendant signed the agreement as the principal investigator. Sprinkles signed it on behalf of the County, as did the Deputy County Executive and VMC's CEO.
In November 2011, Dr. Banuelos, as the Chief Medical Officer, signed Clinical Research Administration Approval forms for the two RTOG clinical trials in which VMC planned to participate. Those forms identified defendant as the principal investigator and stated "administration performed by CIMR." After receiving those final approvals from Dr. Banuelos, defendant began enrolling patients in the RTOG clinical trials.
Despite the statement on the Clinical Research Administration Approval forms that CIMR would be administering the RTOG grants, no third party administration agreement was in place in November 2011. Defendant, Sprinkles, Dr. Banuelos, and Dr. Reese each testified that their expectation was for CIMR to administer the RTOG grant funds. Defendant's understanding was that Kevin Hutchcroft was working on the necessary agreement. Sprinkles testified that Hutchcroft would have been the one to prepare the requisite agreement between the County and CIMR.
Norma Ruiz was hired as CIMR's Administrative Director on October 31, 2011. Shortly after being hired, she had a conversation with Hutchcroft about the RTOG study. On November 21, 2011, Hutchcroft emailed Ruiz that they should "meet relatively soon" regarding the RTOG trials, as defendant and Dr. Reese were "interested in CIMR administering the studies." Defendant and Dr. Reese were copied on that email. Nothing came of these communications, however, because Hutchcroft was placed on administrative leave on November 28, 2011 and terminated from VMC on March 9, 2012. Neither Ruiz nor defendant ever was informed that Hutchcroft had left VMC. Indeed, emails suggest Ruiz and defendant each still believed Hutchcroft worked at VMC as late as July 2012. Selene Ho Gee took over Hutchcroft's duties on an interim basis for six months until a replacement could be hired. She knew nothing about the RTOG grant.
2. VMC Policy No. 638
At the time defendant obtained the RTOG grant, VMC Policy and Procedure No. 638 (Policy No. 638) set forth "the administrative requirements related to obtaining grants, recovery of costs and reimbursements, use of personnel and space, conflict of interest, and the review and approval process." With respect to "Study Costs," Policy No. 638 provided that, "[f]or studies administered by a third party administrator, both the principal investigator and the third party administrator will be responsible for assuring the appropriateness of expenditures against this account." As to studies administered by a third party administrator, Policy No. 638 further provided that the principal investigator must inform the Research Contracts and Administrative Manager of the third party administrator who will financially manage the grant funds. Policy No. 638 stipulated that "County personnel may not receive payment or other remuneration for work on research project without prior approval of the appropriate Department Chairperson and Hospital Director or Chief Medical Officer."
Dr. Banuelos testified that VMC doctors who perform clinical research are expected to be familiar with Policy No. 638. Defendant testified that he was unaware of Policy No. 638. He acknowledged on cross-examination that it would be reasonable for a doctor conducting grant research to look up the applicable hospital policy, although he made no attempt to do so. Defendant testified that he understood that, as the principal investigator, he was "charged with the responsibility to hold and account for [the RTOG grant] funds."
3. Defendant Deposits Grant Funds Into a Personal Account
The American College of Radiology sent the grant funds to defendant's attention at VMC in the form of monthly checks. The checks were made payable to the order of "SANTA CLARA VALLEY MED CTR." The American College of Radiology's senior director for clinical trials testified that, when it distributes grant money to member institutions, the money belongs to the institution.
Defendant testified that when he received the first check in early 2012, he was unsure what to do with it. He did not reach out to Dr. Reese, Deputy County Counsel Sprinkles, Hutchcroft, VMC's Chief Medical Officer, Ruiz at CIMR, or anyone else for advice. Instead, in February 2012, he opened a bank account in the name of "Tri Minh Do dba Santa Clara Medical" and deposited the grant funds into that account (the dba account). ("Santa Clara Medical" was a fictitious business name defendant had registered with the County in 2009 because he was considering going into private practice.)
Between February 2012 and November 2012, defendant deposited 12 grant fund checks worth $51,400 into the dba account. Defendant also deposited personal funds into the dba account. Defendant used the funds in the dba account for research-related expenses, as well as for personal expenses. He also transferred money from the dba account to his other personal accounts and gave money from the dba account to his wife to invest as she saw fit. He testified that he viewed the dba account as interchangeable with his 21 other bank accounts. On February 28, 2013, the dba account balance was just $1,867.93. However, an expert forensic accountant testified for the defense that defendant always had sufficient funds in his various bank accounts to cover the amount of the grant funds he had received.
For reasons unrelated to the RTOG grant, defendant was placed on administrative leave on October 19, 2012 and his employment was terminated on February 22, 2013. He was told not to contact anyone at VMC while he was on administrative leave. He testified that, after he was fired, he intended to transfer the grant funds to CIMR eventually, "when things started to settle down." However, he made no attempt to do so.
Defendant never told Dr. Banuelos, who was Chief Medical Officer until May 5, 2012, that he was receiving grant funds directly. Nor did defendant inform Clifford Wang, M.D., VMC's interim Chief Medical Officer between May and December 2012, about the RTOG grant funds in his possession. Defendant testified that no one at VMC knew he was receiving the RTOG grant funds and he did not inform anyone of that fact at the time of his termination.
4. The Investigation
After defendant's termination, Nam Cho, M.D., another radiation oncologist at VMC, opened mail addressed to defendant that did not appear to be personal. In the Spring of 2013, Dr. Cho opened an envelope from the American College of Radiology containing an RTOG grant check. She made a number of inquiries as to what to do with the check and eventually contacted the then-Chief Medical Officer, Jeffrey Arnold, M.D.
Russell Chubon, a criminal investigator for the Santa Clara County District Attorney's Office, interviewed defendant on July 16, 2013 at defendant's office. A recording of that interview was played for the jury. In the interview, defendant told Chubon that "the idea . . . [was to] have CIMR as the holder of the funds, but that even then CIMR going through some, I guess, changes. I'm not sure what was going on. Again in hindsight, it's not the right thing to do, but at the time, I thought it was the right thing to do to hold it. But then when I separated, this kind of all happened. I didn't know what to do with the funds." Defendant said he was "planning to [tell the County about the funds] at some point." In response to the question "Did you think to yourself at some point-hey this is wrong? I'm doing something I shouldn't do[.] Did you feel that way at some point?" defendant responded "Yeah, I guess I did. Yeah, I did."
B. Procedural Background
A felony complaint filed on August 27, 2013 alleged that defendant misappropriated public funds in violation of section 424, subdivision (a) between February 1, 2012 and November 30, 2012. At a court appearance on November 1, 2013, defendant gave a check for $46,400 made out to Santa Clara Valley Medical Center to a VMC representative.
Defendant was held to answer following a November 7, 2014 preliminary hearing. On November 13, 2014, the Santa Clara County District Attorney charged defendant by information with felony misappropriation of public funds in violation of section 424, subdivision (a) between February 1, 2012 and November 30, 2012.
The case proceeded to a jury trial in late January 2016. At the close of the prosecution's case, the defense moved for judgment of acquittal under section 1118.1 on the theory that there was no evidence that defendant was aware of Policy No. 638 or that his lack of knowledge was criminally negligent. The court denied that motion.
On February 1, 2016, Dr. Arnold testified that, in late 2013 or early 2014, the Society of Research Administrators International (SRA) evaluated VMC's research management and issued a report making various recommendations. The SRA report was not produced to the defense during discovery despite a subpoena to the County Counsel's office. The court obtained a copy of the report from the County Counsel's office, which asserted it was protected by the attorney-client privilege. On February 3, 2016, following an in camera review of the SRA report, the court released a redacted version of the document to the parties subject to a protective order. The following day, defense counsel sought to admit the SRA report into evidence and to recall Sprinkles to question her about it; the prosecutor opposed to both requests. The court excluded the SRA report under Evidence Code section 352 and because it contained multiple levels of hearsay and was cumulative of other evidence.
Also on February 4, 2016, the court questioned three jurors about possible contact with a defense witness. The jurors acknowledged congregating outside the courtroom when they should have been in the jury assembly room but denied discussing the case with one another. One juror said she saw but did not interact with defendant's wife, who testified at trial. Another juror said she had exchanged "hellos" with defendant's wife. The third juror denied seeing any witnesses. Neither the prosecutor nor defense counsel sought to question the jurors further or expressed any concern regarding the incident. The court found no misconduct.
Thereafter, counsel made their closing arguments, the court instructed the jury, and deliberations began. The jury returned a verdict of guilty of violating section 424, subdivision (a)(1) the following morning, February 5, 2016.
After trial, defendant invited the court to dismiss the conviction under section 1385. Separately, he moved for a new trial on the ground that the court erred in not admitting the SRA report and in denying his related request to recall Sprinkles. Alternatively, defendant requested that the court delay ruling on his post-trial motions until the California Supreme Court issued its decision in People v. Hubbard (2016) 63 Cal.4th 378 (Hubbard), which had been argued about six weeks earlier. He asserted that the court's decision in Hubbard could impact whether there was sufficient evidence to conclude that he was "charged with the receipt, safekeeping, transfer, or disbursement of public moneys" for purposes of section 424.
On May 23, 2016, the court declined to dismiss under section 1385 and denied the motion for a new trial. The court then suspended imposition of sentence and placed defendant on three years' formal probation subject to various conditions, including that defendant pay $42,000 in restitution to the American College of Radiology and that he "not be employed by nor do volunteer work for a person, business, or organization in which his primary responsibility involves the direct management of financial matters." The court imposed the minimum restitution fine of $240 plus a 10 percent administrative fee for a total of $264 (§ 1202.4, subd. (b)) with an additional $240 probation revocation fine, which was suspended pending successful completion of probation (§ 1202.44); a $40 court security fee (§ 1465.8); a $30 criminal conviction assessment fee (Gov. Code, § 70373); a $259.50 criminal justice administration fee payable to the County (Gov. Code, §§ 29550, 29550.1, 29550.2); a $100 presentence investigation fee (§ 1203.1b); and a $50 monthly probation supervision fee (§ 1203.1b). Defendant raised no objections to the probation conditions or the fines and fees.
The American College of Radiology requested $42,000 in restitution to cover expenses related to defendant's actions, including the cost of an internal audit it conducted upon learning of defendant's conduct.
On June 24, 2016, defendant moved for reconsideration of his section 1385 request to dismiss and his new trial motion in light of our Supreme Court's decision in Hubbard, which was issued on June 16, 2016. The court denied defendant's motion for reconsideration on July 11, 2016. Defendant timely appealed on July 12, 2016.
In Hubbard, our Supreme Court held that "an individual is 'charged with the receipt, safekeeping, transfer, or disbursement of public moneys' under the meaning of section 424 so long as he or she exercises a degree of material control over public funds that amounts to being 'charged with' such authority." (Hubbard, supra, 63 Cal.4th at p. 394.) Prior to Hubbard, case law held that section 424 applied to anyone with " 'some control over public funds.' " (Hubbard, supra, at p. 392.) --------
II. DISCUSSION
Having examined the entire record, we conclude that there are no arguable issues on appeal.
III. DISPOSITION
The judgment is affirmed.
/s/_________
ELIA, ACTING P. J. WE CONCUR: /s/_________
PREMO, J. /s/_________
MIHARA, J.