Opinion
A20-0603
01-19-2021
State of Minnesota, Respondent, v. Barbara Ann Currin, Appellant.
Keith Ellison, Attorney General, Nicholas Wanka, Assistant Attorney General, St. Paul, Minnesota; and John J. Choi, Ramsey County Attorney, St. Paul, Minnesota (for respondent) Cathryn Middlebrook, Chief Appellate Public Defender, Chang Y. Lau, Assistant Public Defender, St. Paul, Minnesota (for appellant)
This opinion is nonprecedential except as provided by Minn . R. Civ. App. P. 136.01, subd. 1(c). Affirmed
Bratvold, Judge Ramsey County District Court
File No. 62-CR-15-10139 Keith Ellison, Attorney General, Nicholas Wanka, Assistant Attorney General, St. Paul, Minnesota; and John J. Choi, Ramsey County Attorney, St. Paul, Minnesota (for respondent) Cathryn Middlebrook, Chief Appellate Public Defender, Chang Y. Lau, Assistant Public Defender, St. Paul, Minnesota (for appellant) Considered and decided by Worke, Presiding Judge; Reilly, Judge; and Bratvold, Judge.
NONPRECEDENTIAL OPINION
BRATVOLD, Judge
In this appeal from an order denying postconviction relief, appellant argues that the district court abused its discretion when it ordered restitution of more than $2.64 million following appellant's conviction for racketeering in the fraudulent receipt of state medical-assistance (MA) payments. Appellant contends that the district court erred in determining the amount of the restitution award and by denying postconviction relief. We conclude that the district court did not abuse its discretion by awarding restitution in the amount of the total payments fraudulently received by appellant's agencies. For that reason, we also conclude that the district court did not err in denying postconviction relief. Thus, we affirm.
FACTS
In 2010, appellant Barbara Ann Currin was convicted in state court of MA fraud. As a result of this conviction, federal regulations excluded Currin from participating as an MA provider. See 42 U.S.C. § 1320a-7(a)(1) (2008) (excluding individuals who have been convicted of a criminal offense relating to the delivery of MA services under state law from participating in federal health-care programs).
Even so, between 2012 and 2015, Currin owned and operated eight agencies and other businesses that billed the Minnesota Department of Human Services (DHS) for services as MA providers. Along with several codefendants, Currin set up agencies that billed DHS for nursing services while concealing Currin's identity as the owner and manager. Based on this scheme and the receipt of MA payments by Currin's agencies, the state charged Currin with one count of racketeering, Minn. Stat. § 609.903, subd. 1(1) (2010), and seven counts of theft by swindle, Minn. Stat. § 609.52, subd. 2(4) (2010).
In June 2016, Currin pleaded guilty to the racketeering count in exchange for the dismissal of the theft counts. At the plea hearing, Currin admitted that the agencies she set up billed DHS for nursing services purportedly provided to clients who were MA eligible. She agreed that, while the agencies provided some services, they billed DHS for more services than were provided. Currin also agreed that her agencies gave clients kickbacks and other incentives to retain them. Currin acknowledged that, based on her 2010 conviction, DHS would not have paid any bills submitted by Currin's agencies had it known of her involvement. Currin agreed that between 2012 and 2015, DHS made MA payments totaling $2,648,548.53 to her agencies. The district court accepted Currin's guilty plea and ordered a presentence investigation.
In July 2016, the district court convicted Currin of racketeering and sentenced her to 122 months in prison. At the sentencing hearing, the state asked the district court to order Currin to pay $2.6 million in restitution. Because Currin's attorney was unable to access the state's evidence to challenge the restitution request, the district court reserved restitution.
Meanwhile, Currin appealed her sentence, which we affirmed in an unpublished decision, the sentencing judge retired, and a new judge was assigned to Currin's case. At the June 2017 restitution hearing, the state submitted many documents detailing the MA payments that DHS made to Currin's agencies. The state also called an investigator from the Minnesota Attorney General's Office. The investigator testified that she calculated the total amount that DHS paid to Currin's agencies as $2,648,539.53. The investigator agreed that DHS would not have made any MA payments to Currin's agencies had it known that Currin was involved in their operations and management. The investigator also testified that state regulations require agencies seeking MA payments to maintain time sheets going back five years, and also prohibit them from giving kickbacks to those receiving services. The investigator added that if DHS determined that an agency had received fraudulent payments, then DHS would seek to recover the entire amount of its payment, and would not seek to recover only the agency's profit.
See Currin v. State, No. A17-1483 (Minn. App. May 7, 2018), review denied (Minn. Aug. 7, 2018).
At the start of the June 2017 hearing, Currin's attorney stated that she had expected the district court to order restitution. The state agreed, and added, because there was no initial restitution order, the parties were unsure about the scope of the restitution hearing. Still, the state's attorney said he was prepared to proceed on both issues: the amount of restitution and Currin's ability to pay.
The investigator, though, testified that she tried to estimate the profit received by Currin's agencies during the MA scheme. In doing so, she subtracted the amount that the agencies purportedly paid their nurses from the total amount that DHS paid the agencies. When calculating this estimate, the investigator assumed that the agencies provided all the services billed, despite evidence to the contrary. Operating on this assumption, the investigator estimated that the agencies' total profit was $1,492,280.17. Currin offered no evidence at the hearing. After the restitution hearing, the parties submitted memoranda and Currin submitted an affidavit about her ability to pay.
In November 2017, the district court ordered Currin to pay restitution of $2,648,539.53, and provided that $50 would be deducted each month from Currin's prison earnings to pay the award. In its memorandum, the district court briefly described Currin's "elaborate scheme" and Currin's role as "ringmaster." The district court stated that Currin "failed to sufficiently meet [her] burden of pleading as it relates to the amount of restitution owed by failing to submit affidavits detailing [her] challenge to the amount of restitution requested by the victim." The district court rejected the profit calculation determined by the state's investigator as "speculative." "It is unclear to this court if the nurses were paid for all their services or if the services alleged to have been provided were in fact provided." The district court also found that Currin did not maintain complete documentation of all services rendered or payments made to nurses.
The district court gave three reasons why it denied Currin's request to award only the "profits made by the illegal enterprise": (1) Currin "failed to produce any evidence" to support her claim, (2) the court did not have "authority to reduce a victim's restitution claim based on expenses incurred by a defendant in obtaining or using the ill-gotten gains," and (3) "[b]ut for [Currin's] deceits, falsehoods and fabrications, the victim would not have funded the enterprise" at all.
Two years later, Currin petitioned for postconviction relief, challenging the amount of the district court's restitution award. In February 2020, the district court's order denying postconviction relief and memorandum echoed the rationale of the restitution order and denied Currin's claim for two reasons. First, "[i]t would require speculation to find that $1.1 [million] of the sums paid by DHS went to provide actual services to legitimate recipients." Second, the district court determined that "if [Currin] had not committed her crime, DHS would not have paid out any of the $2.6 [million]." The district court also stated, "[i]t might be that some of the DHS beneficiaries who actually received nursing services under [Currin's] enterprise would have obtained the services elsewhere and that DHS would have paid for them, but it is speculative to so find and to put a number on such services."
Currin appeals.
DECISION
We review a denial of postconviction relief for abuse of discretion. Riley v. State, 819 N.W.2d 162, 167-68 (Minn. 2012); Davis v. State, 784 N.W.2d 387, 390 (Minn. 2010). "[W]e review questions of law de novo, but our review of questions of fact is limited to whether there is sufficient evidence in the record to support the findings of the postconviction court." Sanchez-Diaz v. State, 758 N.W.2d 843, 846 (Minn. 2008).
A district court has broad discretion to award restitution, subject to review for abuse of discretion. State v. Tenerelli, 598 N.W.2d 668, 672 (Minn. 1999). A court abuses its discretion when its decision is based on an erroneous view of the law. Riley v. State, 792 N.W.2d 831, 833 (Minn. 2011). If the issue on appeal involves the interpretation of the restitution statute, our review is de novo. State v. Jones, 678 N.W.2d 1, 23 (Minn. 2004). And "whether an item meets the statutory requirements for restitution is a question of law fully reviewable by the appellate court." State v. Ramsay, 789 N.W.2d 513, 517 (Minn. App. 2010) (quotation omitted).
Currin makes two arguments on appeal. First, she contends that the district court abused its discretion in the initial restitution award because its decision rested on an erroneous view of the law—that Currin failed to produce evidence "which allows [her] to make such a claim"—when Minnesota law provides that the state has the burden of proof. Second, Currin argues that the state's evidence is insufficient to support the amount of the restitution award because it only proved that DHS suffered an "actual loss" of $1.49 million, rather than $2.64 million. Because our analysis of Currin's burden-of-proof argument is framed by her actual-loss argument, we first discuss the actual loss suffered by DHS.
I. The district court did not abuse its discretion by ordering restitution in the full amount fraudulently received by Currin's agencies.
A. Restitution for economic loss or actual loss
Currin asserts that the restitution award should not include the portion of DHS's payments to her agencies for services that were provided and, if these payments are set aside, then the state proved only that DHS's "actual loss" was $1.49 million. Currin first explains that the state's investigator calculated a "floor" for the restitution amount by estimating the agencies' profit: "if the providers actually did provide all these [nursing] services that they claimed, here is what the profit to the agency was." She next argues that the state failed to prove that "had Currin not committed her offenses, DHS would have withheld the Medicaid funds that it disbursed for the services that Currin's nurses provided." (Emphasis added.) This is so, according to Currin, because clients would have received these services elsewhere and, presumably, DHS would have made the MA payments anyway. Currin adds that "[t]his Court has never decided the specific issue raised below—whether money illegitimately gained but that was used to pay for legitimate services to the benefit of the victim should factor into the calculation for a victim's economic losses under the restitution statutes."
The state urges us to affirm because the record supports the district court's decision to award restitution of the total amount paid by DHS to Currin's agencies based on her fraudulent scheme, and the law does not allow a district court to give Currin a "credit" for the value of services that her agencies allegedly provided. Finally, even if the law allowed a district court to credit an offender in the way that Currin proposes, the state contends that the district court did not abuse its discretion by rejecting Currin's claim in this case.
"A victim of a crime has the right to receive restitution as part of the disposition of a criminal charge." Minn. Stat. § 611A.04, subd. 1(a) (2016). "The primary purpose of the [restitution] statute is to restore crime victims to the same financial position they were in before the crime." State v. Palubicki, 727 N.W.2d 662, 666 (Minn. 2007). "A request for restitution may include, but is not limited to, any out-of-pocket losses resulting from the crime . . . ." Minn. Stat. § 611A.04, subd. 1(a) (emphasis added).
In determining the amount of restitution to order, the district court shall consider "(1) the amount of economic loss sustained by the victim as a result of the offense; and (2) the income, resources, and obligations of the defendant." Minn. Stat. § 611A.045, subd 1(a) (2016) (emphasis added); see also State v. Terpstra, 546 N.W.2d 280, 282-84 (Minn. 1996) (affirming district court's decision to award restitution in excess of the statutory parameters for the convicted offense because award was supported by a preponderance of the evidence). Thus, the amount of the restitution award is not limited to out-of-pocket loss and considers the victim's economic loss.
The parties make four arguments about the amount of restitution. The state contends that two separate grounds support the district court's decision to award restitution of the total amount of MA payments to Currin's agencies. Currin disagrees and contends that this court should use the "actual loss" standard used in federal caselaw. Alternatively, Currin argues that the record does not support the amount of the district court's award. We discuss each argument in turn.
1. "Value" under the theft statute
The state argues that we should affirm based on the theft statute's definition of "value": "For a check, draft, or other order for the payment of money, 'value' means the amount of money promised or ordered to be paid under the terms of the check, draft, or other order." Minn. Stat. § 609.52, subd. 1(3) (2010). But the restitution statute authorizes recovery of "economic loss," not "value" as defined by the theft statute. Thus, the theft statute does not guide our analysis.
While neither party cited State v. Harvey, we note some parallels. 547 N.W.2d 706 (Minn. App. 1996), review denied (Minn. Aug. 6, 1996). There, this court reviewed the state's appeal from a restitution award following a conviction for welfare fraud. Respondents had misrepresented their status and fraudulently received benefits under a particular welfare program. Id. at 707-08. The state argued that the district court had erred in determining that "the restitution amount should reflect only the excess benefits the recipients received over what they would have received" under the proper program. Id. at 709. To resolve the issue, we considered the welfare-fraud statute's definitions. Id. Under the welfare-fraud statute, the "amount of assistance incorrectly paid" was defined as "the difference between the amount of assistance actually received on the basis of misrepresented or concealed facts and the amount to which the recipient would have been entitled had the specific concealment or misrepresentation not occurred." Minn. Stat. § 256.98, subd. 3 (1994). The same statute also provided for restitution of the amount of assistance incorrectly paid "as a debt due the county or the state." Minn. Stat. § 256.98, subd. 4 (1994). We affirmed the district court's restitution award after determining that "[t]he debt amount is also the proper restitution figure." Harvey, 547 N.W.2d at 709. We reasoned that the welfare-fraud statute affected the determination of the victim's loss for restitution because it "provides for consideration of what the recipient would have been entitled to had the misrepresentation not occurred." Id.
The racketeering statute underlying Currin's conviction also contains a restitution subdivision. See Minn. Stat. § 609.904, subd. 5. But that subdivision does not include a provision for the amount of recovery, as did the welfare-fraud statute discussed in Harvey. We therefore rely on the language of the general-restitution statute to determine the issues in this appeal.
2. Racketeering scheme as the cause of MA payments
The state argues that the district court found that "DHS would not have paid out any money had it known [Currin] ran her agencies," and that "but for [Currin's] fraudulent representations about the true ownership of the business, DHS would not have paid [Currin's] agencies the $2,648,539.53 it did." We are not persuaded.
This argument relies on "but-for" causation, which does not apply here. The Minnesota Supreme Court has declined to apply a but-for test to restitution awards because "a but-for test has the potential to expand a restitution award beyond the statutory provision." Palubicki, 727 N.W.2d at 667. Instead, as the supreme court later clarified: "[A] district court may order restitution only for losses that are directly caused by, or follow naturally as a consequence of, the defendant's crime." State v. Boettcher, 931 N.W.2d 376, 381 (Minn. 2019) (emphasis added) (overruling "some factual relationship" standard of State v. Nelson, 796 N.W.2d 343 (Minn. App. 2011)). Thus, we apply the direct-causation standard.
The district court determined that the state's evidence proved that Currin's racketeering scheme directly caused DHS to sustain an economic loss in excess of $2.6 million when it paid Currin's agencies. Indeed, Currin's own testimony at the plea hearing establishes the amount DHS paid to her agencies in MA payments during the relevant time. We conclude the record supports the district court's determination that DHS's MA payments to Currin's agencies "flowed naturally as a consequence of" Currin's scheme to conceal her involvement. See Boettcher, 931 N.W.2d at 381. Thus, the district court's decision follows existing precedent on causation, but Currin's arguments require that we address the amount of restitution.
3. Federal caselaw and "actual loss"
Both parties advance federal caselaw to persuade us of their respective positions on the correct standard for determining the amount of restitution. Currin cites United States v. Mahmood, 820 F.3d 177 (5th Cir. 2016), where the defendant manipulated federal Medicare payments by billing for some legitimate services, but also by billing for services not provided, so the defendant received overpayments. The federal district court ordered the defendant to pay restitution in the total amount of Medicare paid, rejecting defendant's argument that payments for legitimate services should not be included. Id. at 184-85. On appeal, the Fifth Circuit vacated the restitution order because the government's evidence established that Medicare would have paid much of the restitution award even without defendant's manipulation. Id. at 195-96. Thus, the Fifth Circuit held the defendant had to repay Medicare's "actual loss" and remanded for reconsideration of the amount of restitution. Id. at 196.
The state argues that Mahmood is not persuasive because its reasoning relies on a comment to the United States Sentencing Guidelines that "the amount of loss must account for 'the fair market value of the . . . services rendered, by the defendant or other persons acting jointly with the defendant, to the victim before the offense was detected.'" See id. at 193 (quoting U.S. Sentencing Guidelines Manual § 2B1.1, cmt n.3(E)(i) (U.S. Sentencing Comm'n 2011)). The state argues that Minnesota has no parallel to the federal guidelines comment. The state also points out that Minnesota's restitution statute directs courts to apply two factors: the victim's economic loss and the defendant's ability to pay. See Minn. Stat. § 611A.045, subd. 1(a). The state contends that these factors are exclusive because the restitution statute does not identify other factors or give the district court discretion to do so. Thus, the state argues that Minnesota implicitly prohibits a district court from considering the value of a defendant's services when determining the amount of a restitution award.
The state cites an unpublished court of appeals decision in its brief to this court to support its argument. Unpublished opinions are not precedential. See Gen. Cas. Co. of Wis. v. Wozniak Travel, Inc., 762 N.W.2d 575 n.2 (Minn. 2009) (stating that "the unpublished Minnesota court of appeals decision does not constitute precedent"); see also Minn. R. Civ. App. P. 136.01, subd. 1(c). Moreover, the state's reliance on this opinion is puzzling. The unpublished decision involved an offender's restitution challenge following a conviction for MA fraud. The district court, in its discretion, reduced the restitution award by amounts that the appellant had paid to others. The state did not challenge this offset on appeal and we did not consider the issue. As a result, this unpublished case does not guide our decision here.
The state's analysis of Minnesota law is accurate. The Minnesota Supreme Court has held that the two factors described in section 611A.045, subdivision 1, are "an exclusive list of factors for determining the amount of restitution to award." State v. Riggs, 865 N.W.2d 679, 685 (Minn. 2015) (rejecting argument that a victim's role as the initial aggressor should factor into the determination of restitution (emphasis added)).
And Currin did not cite, nor can we find, a parallel in Minnesota law to the federal "actual loss" standard used by the Fifth Circuit in Mahmood. To be clear, the federal sentencing guidelines comment instructs a district court to use the fair market value of services rendered by the offender to determine the amount of loss as an offense characteristic for sentencing, and not for a restitution award. See Mahmood, 820 F.3d at 192-93. But the restitution award challenged in Mahmood tracked the amount of loss, in part, because federal law specifically provides that a victim's actual loss is the standard for restitution. Id. at 196 (citing 18 U.S.C. § 3664(e) (2014)). Minnesota law has not adopted the "actual loss" standard used by the federal courts.
We also distinguish Mahmood factually. The defendant there was eligible to provide services and receive Medicare payments, id. at 182, while Currin was strictly prohibited from providing MA services and receiving MA payments. The record establishes that DHS would have paid nothing to Currin's agencies had it known of her involvement. Mahmood is therefore not persuasive, nor are the other federal cases cited by the parties.
Similar reasons lead us to reject federal caselaw cited by the state, such as United States v. Jones, 664 F.3d 966 (5th Cir. 2011), and United States v. Triana, 468 F.3d 308 (6th Cir. 2006). While the facts in those cases are more like the facts here, both cases rely on the same federal sentencing guidelines comment that finds no parallel in Minnesota law. See Jones, 664 F.3d at 984; Triana, 468 F.3d at 319-20.
Rather, in keeping with Riggs, we conclude that, when determining the restitution amount, a district court's analysis is confined to the two exclusive statutory factors for determining a victim's economic loss, see Minn. Stat. § 611A.045, subd 1(a), and a district court may not consider Currin's proposed additional "factor" of "money illegitimately gained but that was used to pay for legitimate services to the benefit of the victim" to determine a victim's actual loss.
4. Record evidence supporting the district court's award
Currin also argues:
If this Court takes as true that DHS paid $1.15 million for services that it would have paid even if Currin did not commit her offense—which it should because the state did not prove
otherwise—then it should vacate the district court's restitution order and reduce Currin's restitution amount because the $1.49 million figure [the state's investigator] calculated more accurately reflects DHS's economic losses under the circumstances of this case.
We disagree. What the victim would have paid without the offender's criminal activity is not a factor under the restitution statute. The restitution statute directs the district court to consider the "economic loss sustained by the victim as a result of the offense" and the defendant's ability to pay, Minn. Stat. § 611A.045, subd. 1(a), and the district court may not consider other factors. Riggs, 865 N.W.2d at 684. Thus, the district court did not abuse its discretion by returning DHS to the same financial position it was in before the crime, or ordering restitution of $2.64 million because Currin's criminal activity directly caused the economic loss. See Boettcher, 931 N.W.2d at 381; Palubicki, 727 N.W.2d at 666.
II. The district court did not err by shifting the burden of proof to Currin.
Currin argues that the district court improperly shifted the burden of proof before awarding restitution because it found that Currin "failed to produce any evidence which allows [her] to make such a claim." Similarly, in denying postconviction relief, the district court reasoned that Currin "introduced no other evidence to prove that the $1.1 [million] figure or some subset of that sum was legitimate." Currin contends that both decisions rested on legal error because the state has the burden of proof during restitution proceedings. The state agrees that it has the burden proof, but argues that the district court's decisions properly applied that burden in the initial restitution order and during postconviction proceedings.
"The burden of demonstrating the amount of loss sustained by a victim as a result of the offense . . . is on the prosecution." Minn. Stat. § 611A.045, subd. 3(a) (2016); State v. Keehn, 554 N.W.2d 405, 407 (Minn. App. 1996), review denied (Minn. Dec. 17, 1996). The district court determines the proper amount of restitution based on a preponderance of the evidence. Minn. Stat. § 611A.045, subd. 3(a). The restitution statute also "imposes two burdens on the offender: The burden of pleading and the burden of production." State v. Thole, 614 N.W.2d 231, 235 (Minn. App. 2000).
The restitution statute sets out a procedure that reflects the state's burden of proof, as well as the defendant's obligation to respond. The district court or a designee shall request information from the victim "in affidavit form. . . . relating to restitution . . . describ[ing] the items or elements of loss." Minn. Stat. § 611A.04, subd. 1(a). The district court must determine "whether to order restitution and the amount of the restitution," based on the two factors discussed above. Minn. Stat. § 611A.045, subd. 1(a). Once the court makes that determination, a defendant may challenge the amount of restitution, and the district court may hold a hearing and amend its earlier order. Minn. Stat. §§ 611A.04, subd. 1(b), .045, subd. 3(a).
At a hearing on the restitution request, "the offender shall have the burden to produce evidence if the offender intends to challenge the amount of restitution or specific items of restitution or their dollar amounts." Minn. Stat. § 611A.045, subd. 3(a).The offender's "burden of production" includes a "detailed sworn affidavit" with all challenges to restitution "and specifying all reasons justifying dollar amounts of restitution which differ from the amounts requested by the victim or victims." Id. Thus, the offender's affidavit "is both the sole vehicle by which the offender can meet the burden of pleading, and an essential element of the offender's case required to meet the burden of production." Thole, 614 N.W.2d at 235. An offender may waive the right to challenge an item of restitution by failing to identify the challenge in an affidavit. Id. at 235 (holding district court "correctly refused" to consider appellant's challenge to specific restitution item because appellant's motion and affidavit did not address it).
At Currin's sentencing hearing, despite a request from the state for a restitution award, the district court did not determine the amount of restitution. Rather, the district court reserved the issue for a later hearing and the hearing was continued. Perhaps because of this particular sequence, Currin never filed an affidavit that identified and challenged specific items and amounts. Still, Currin argues that "the peculiar circumstances of this case relieved [her]. . . of her procedural obligations under section 611A.045."
We note that Currin filed an affidavit on restitution, but her affidavit included no challenges to the amount of restitution. Rather, Currin's affidavit detailed her ability to pay. She also filed a memorandum arguing her challenges to the state's position. To be clear, we see no error on the timing of the restitution hearing. Minn. Stat. § 611A.04, subd 1(a) provides that "restitution is reserved or the . . . hearing on the restitution request may be continued if the victim's affidavit or other competent evidence submitted by the victim is not received in time." Based on our review of the record, the district court had discretion to continue the restitution hearing.
We note that the state appears to agree with Currin's position and, at no point during these proceedings has the state contended that Currin waived her challenge to the amount of restitution. Indeed, Currin relies on the state's explanation of the "peculiar circumstances" at the restitution hearing: (1) restitution was left open after Currin's sentencing, (2) the district court did not order restitution until after the restitution hearing, and (3) the scope of the restitution hearing was unclear.
Despite these "peculiar circumstances," Currin acknowledges that the state submitted evidence at the hearing, and points out that the state was aware of and responded to Currin's argument that the restitution award should be in the amount of the state's "actual loss," not total payments made by DHS. Thus, Currin argues that the district court erred when it ruled that she did not present sufficient evidence to prove a lesser restitution award because "that burden did not lie with Currin."
We agree with Currin that, under the "peculiar circumstances of this case," the district court appears to have relieved Currin of her obligation to submit a detailed sworn affidavit specifying her challenges to the restitution amount. But even if we assume that the district court erred in its comment about Currin's failure to produce evidence, we must consider whether the comment prejudiced Currin. "Any error that does not affect substantial rights must be disregarded." Minn. R. Crim. P. 31.01.
Currin's substantial rights were not affected for two reasons. First, after the restitution hearing, and later, during the postconviction proceedings, the district court considered the evidence and analyzed Currin's argument about how to determine the amount of loss for the restitution award. Thus, Currin's failure to file an affidavit did not affect the district court's analysis.
Second, the district court's decision to award restitution in the total amount paid by DHS to Currin's agencies was fully supported by record evidence offered by the state. Using the preponderance of the evidence standard, the district court rejected the lower award advanced by Currin because the state investigator's testimony about the profit retained by her agencies rested on the assumption that Currin's agencies provided all services billed, even though the record established otherwise. The district court acted within its discretion when it rejected this part of the investigator's testimony as "speculative" because it was for "services allegedly provided." Record evidence also established that Currin's agencies failed to "maintain or provide complete documentation of all services rendered or payments made to nurses during the time of the operation notwithstanding the requirement that they do so by DHS." Contrary to Currin's allegation, the district court's determination of the amount of restitution rested on a preponderance of the evidence and did not improperly shift the burden of proof away from the state. Thus, the district court's comment on Currin's failure to produce evidence did not affect her substantial rights.
In conclusion, the district court conducted an evidentiary hearing on restitution even though Currin had not filed an affidavit specifically challenging the amount. The district court thus relieved Currin of her burden of pleading and production. Currin was free, however, to rebut the state's claim and to offer evidence or rely on the state's evidence to argue that DHS's economic loss was less than the total amount paid. Throughout the restitution proceedings, the burden of proof remained on the state. We hold that the district court did not abuse its discretion in determining that Currin's fraudulent scheme directly caused DHS's economic loss of $2.64 million.
Affirmed.