Opinion
21-4255
06-10-2024
UNITED STATES OF AMERICA, Plaintiff - Appellee, v. JAVAID PERWAIZ, Defendant-Appellant.
Wesley P. Page, Jonathan D. Byrne, OFFICE OF THE FEDERAL PUBLIC DEFENDER, Charleston, West Virginia, for Appellant. Jessica D. Aber, United States Attorney, Joseph Attias, Assistant United States Attorney, Richmond, Virginia, E. Rebecca Gantt, Assistant United States Attorney, Elizabeth M. Yusi, Assistant United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Norfolk, Virginia, for Appellee.
UNPUBLISHED
Submitted: January 5, 2024
Amended: June 10, 2024
Appeal from the United States District Court for the Eastern District of Virginia, at Norfolk. Rebecca Beach Smith, Senior District Judge. (2:19-cr-00189-RBS-DEM-1)
ON BRIEF:
Wesley P. Page, Jonathan D. Byrne, OFFICE OF THE FEDERAL PUBLIC DEFENDER, Charleston, West Virginia, for Appellant.
Jessica D. Aber, United States Attorney, Joseph Attias, Assistant United States Attorney, Richmond, Virginia, E. Rebecca Gantt, Assistant United States Attorney, Elizabeth M. Yusi, Assistant United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Norfolk, Virginia, for Appellee.
Before DIAZ, Chief Judge, and NIEMEYER and RICHARDSON, Circuit Judges.
Affirmed by unpublished opinion. Chief Judge Diaz wrote the opinion, in which Judge Niemeyer and Judge Richardson joined.
Unpublished opinions are not binding precedent in this circuit.
DIAZ, CHIEF JUDGE:
After a nearly five-week trial, a jury convicted Javaid Perwaiz of 52 counts of healthcare fraud and making false statements in relation to healthcare matters. The district court then sentenced him to 708 months' imprisonment.
Perwaiz now asserts two evidentiary challenges from his trial and an ineffective assistance of counsel claim. But because any evidentiary error would be harmless considering the overwhelming evidence of Perwaiz's guilt, we affirm his convictions. And because any ineffective assistance by Perwaiz's counsel doesn't "conclusively appear[] in the trial record," United States v. Mandello, 426 F.2d 1021, 1023 (4th Cir. 1970), we affirm his sentence.
I.
A.
Javaid Perwaiz was a Virginia-licensed OB/GYN who regularly treated pregnant patients and performed procedures such as colposcopies, hysteroscopies, and hysterectomies on other patients. Perwaiz contracted with healthcare benefit companies, including private insurers (like Anthem and Optima) and public insurers (like Medicare and Medicaid), that would pay or reimburse Perwaiz for his services. To be certified as a "participating provider," J.A. 626:6, and to bill for the care he provided, Perwaiz had to enroll (and periodically reenroll) with these insurers.
A colposcopy is a procedure used to examine a patient's cervix that is generally done after an abnormal Pap smear or human papillomavirus test. J.A. 549:25-550:17.
A hysteroscopy is a procedure used to examine a patient's uterine cavity to detect, among other things, cancer, fibroids, or polyps. J.A. 562:15-24.
A hysterectomy is an irreversible procedure removing a patient's uterus because of a benign condition such as uterine fibroids, or a malignant condition such as cancer. J.A. 572:15-573:2.
During the respective enrollment processes, Perwaiz had to agree to certain terms and conditions-such as a 30-day waiting period between obtaining a Medicaid patient's signature consenting to sterilization and conducting the procedure-and to verify certain information-such as listing any type of adverse employment action that had been taken against him or any felony convictions. And once these insurers approved Perwaiz's enrollment, they would only reimburse him for services or procedures that met the appropriate "medical standard of care," J.A. 523:12-19, and were "medically necessary," J.A. 1155:23-1156:2.
In 2018, the FBI received a tip from one of Perwaiz's former colleagues alleging that he had performed unnecessary surgeries on unsuspecting patients. As the FBI investigated Perwaiz, it found that this wasn't the first instance of his medical misconduct.
In 1983, for example, Maryview Hospital in Portsmouth, Virginia, temporarily terminated Perwaiz's clinical privileges "due to poor clinical judgment, unnecessary surgery, lack of documentation, and discrepancies in recordkeeping." J.A. 7484. The Hospital recited that Perwaiz performed eleven hysterectomies on patients, "contrary to sound medical judgment." J.A. 7484-86. The Virginia Board of Medicine then "[c]ens[u]red" Perwaiz in a separate proceeding based on these findings, citing a "lack of documentation." J.A. 7488. The Board didn't recommend any other disciplinary action, but it noted that his censure would "become part of [his] permanent record for future reference." J.A. 7488.
At the time, Virginia's medical licensing authority was called the "Department of Health Regulatory Boards."
Perwaiz resumed practicing medicine when Maryview reinstated his privileges. But about a decade later, he was charged with six counts of federal felony tax evasion. He ultimately pleaded guilty to two of those counts. The district court sentenced Perwaiz to five years' probation. Because of those convictions, the Virginia Board of Medicine briefly suspended Perwaiz's medical license.
Perwaiz once more resumed practicing medicine, operating a solo OB/GYN practice with access to the operating room at Chesapeake Regional Medical Center. But between 2017 and 2019, he repeatedly failed to report and falsely denied his earlier disciplinary and criminal history when he enrolled to be a provider in public and private healthcare benefit programs.
Perwaiz's fraud didn't end there.
First, Perwaiz falsified his pregnant patients' estimated due dates so that he could induce labor on a day he had standing operating room time at Chesapeake. Doing so ensured that Perwaiz was the doctor who performed the deliveries and was therefore the doctor who was paid through the patients' insurance coverage. But doing so also meant that many of these elective inductions occurred before 39 weeks' gestation-that is, earlier than medically recommended-and without any "medical indication[s]." J.A. 2247:13. This was contrary to the accepted standard of care, yet Perwaiz still billed insurance companies for full-term or medically necessary deliveries.
Second, Perwaiz performed and billed for medically unnecessary surgeries, including hysterectomies, based on fabricated symptoms. He falsely told several patients, for example, that they had cancer (or would get cancer) and required surgery. He then documented this nonexistent condition and used it as the basis for performing and billing for the eventual procedure.
Third, Perwaiz billed insurers for in-office diagnostic procedures like hysteroscopies and colposcopies that (a) weren't performed, (b) were performed in a nonstandard way, or (c) were performed with broken instruments. He then routinely used the results from these procedures to justify other, more invasive surgeries that he also billed for.
Fourth, Perwaiz falsified his Medicaid patients' sterilization consent forms verifying that he had abided by the required 30-day waiting period. He had these patients sign blank consent forms but not date them. He then backdated the forms so that it appeared the patients signed them prior to 30 days before the surgery. And Perwaiz billed Medicaid for the sterilizations, even when he performed them within the 30-day period.
Several of these patients hadn't even been under Perwaiz's care for 30 days before he performed the sterilizations.
B.
A superseding indictment charged Perwaiz with committing healthcare fraud and making false statements related to healthcare matters.
During trial, the government introduced two exhibits containing evidence of Perwaiz's suspension from Maryview Hospital and his prior felony tax convictions. Perwaiz had moved in limine to exclude those exhibits under Federal Rules of Evidence 403 and 404. Though the court found the evidence was reliable, and intrinsic to two counts addressing Perwaiz's failure to disclose his disciplinary history to a pair of insurance companies (Anthem and Optima), it didn't admit the exhibits in full. The court allowed only the fact of the suspension and convictions, not the underlying details. It redacted, for example, Perwaiz's indictment so that the jury saw only the two charges to which Perwaiz pleaded guilty.
The government introduced over 500 other exhibits and called 55 witnesses at trial. Six witnesses were former patients who were referenced in the indictment's factual allegations but weren't subjects of any count. They testified about Perwaiz's falsifying the sterilization consent forms or falsifying symptoms to bill for unnecessary surgeries. Perwaiz didn't object to their testimonies at trial. He did, however, testify in his own defense and admitted that he had backdated the Medicaid sterilization consent forms.
The jury convicted Perwaiz on 23 counts of healthcare fraud and 29 counts of making false statements in relation to healthcare matters.
C.
Before sentencing Perwaiz, the district court considered Perwaiz's presentence investigation report. The report put Perwaiz's guidelines range at life imprisonment, restricted to the statutory maximum of 5,700 months' imprisonment.
The district court also considered the sentencing memoranda Perwaiz and the government submitted. And it received victim impact statements from over 60 women, many of whom recounted their physical and emotional trauma. So too did the district court hear that Perwaiz's fraudulent scheme caused over $18 million in losses to insurers.
At sentencing (as in his sentencing memorandum), Perwaiz maintained his innocence, so his counsel objected only generally to the guidelines calculation and associated sentencing enhancements. And they requested no particular sentence. Rather, at sentencing, Perwaiz's counsel stated that they had "every confidence that the Court will fashion a sentence . . . that is sufficient but not greater than necessary" under the 18 U.S.C. § 3553 factors. J.A. 3569:8-10.
Perwaiz was represented by two lawyers during his trial and sentencing.
Counsel noted, however, that Perwaiz was "71 years old" with "ongoing medical conditions." J.A. 3569:22. Counsel also explained that Perwaiz had a limited prior criminal history, and that, for his earlier felony convictions, he had completed his probationary sentence, paid back the funds, made no effort to flee, and acknowledged his guilt. Counsel concluded by pointing out that Perwaiz no longer had a medical license and wouldn't return to practicing medicine if he were released from prison. The government, meanwhile, requested a prison sentence of 600 months (or 50 years).
The district court imposed a 708-month (or 59-year) sentence. It explained that the "nature and circumstances of the offense and [Perwaiz's] history and characteristics" were the "most important" factors it considered. J.A. 3571:15-18. The court also described the evidence of Perwaiz's guilt as "overwhelming," while chiding him for "abu[sing] the trust" that his patients had placed in him and that his profession had placed in [him]." J.A. 3572:2, 11. And it noted that Perwaiz had "expressed no remorse for such a callous disregard for the welfare of [his] patients and the victims." J.A. 3572:15-17.
This appeal followed.
II.
Perwaiz brings three challenges to his convictions and sentence. He asserts that during trial, the district court erred in (1) admitting into evidence the exhibits concerning his suspension from Maryview Hospital and felony tax convictions, and (2) allowing the testimony of the six patient-witnesses who weren't named in any count of the indictment. And he claims that during sentencing, his lawyers were so ineffective that they all but abandoned him.
We address each argument in turn.
A.
We begin with Perwaiz's evidentiary challenges. As he did at trial, Perwaiz mainly contends that the evidence of his suspension and prior convictions violated the Federal Rules of Evidence because it was unduly prejudicial and impermissibly went to his character rather than to the conduct at issue.
We will overturn a "district court's decision to admit evidence over a Rule 403 objection" only "under the most extraordinary circumstances, where [the district court's] discretion has been plainly abused." United States v. Williams, 445 F.3d 724, 732 (4th Cir. 2006) (cleaned up). But evidentiary challenges have an additional-and here, dispositive-backstop: harmless error review. See United States v. Walker, 32 F.4th 377, 394 (4th Cir. 2022).
"[A]n error is harmless if it's highly probable that it did not affect the judgment." United States v. Caldwell, 7 F.4th 191, 204 (4th Cir. 2021) (cleaned up). "The decisive factors to consider are the closeness of the case, the centrality of the issue affected by the error, and the steps taken to mitigate the effects of the error." Id. (cleaned up). There's no dispute then that an error is harmless "where there is a significant amount of evidence which inculpates a defendant independent of the erroneous [evidence]." United States v. Johnson, 617 F.3d 286, 295 (4th Cir. 2010); see also United States v. Scheetz, 293 F.3d 175, 186 (4th Cir. 2002) (finding an error harmless where, "[m]ost importantly, absent [the error], the government's case against [the defendant] was overwhelming" (cleaned up)).
Even if we assume the district court erred (which seems unlikely), the evidence against Perwaiz was overwhelming. Scores of witnesses-former patients and employees, including nurses, billers, and ultrasound technicians; Chesapeake personnel; OB/GYN and insurance experts; and insurance company representatives-testified about Perwaiz's fraudulent conduct. And the government introduced documents to support this testimony and each aspect of Perwaiz's fraudulent scheme.
We're inclined to agree with the government that the challenged exhibits were intrinsic to the two counts charging Perwaiz with lying to insurers about his disciplinary history.
The government, for example, introduced recordings wherein Perwaiz told a patient that he would falsify her records for insurance purposes, and misrepresented to another patient that she was suffering from tumors when a subsequent ultrasound found no such tumors. Perwaiz also admitted at trial to regularly backdating the Medicaid sterilization consent forms.
This evidence related to Perwaiz's present fraudulent scheme and not to his past disciplinary history. And the district court redacted or otherwise limited the challenged exhibits, mitigating the prejudicial effect the evidence might have on the jury. As Perwaiz concedes, "[e]vidence that is highly probative invariably will be prejudicial to the defense." Appellant's Br. at 24 (quoting United States v. Grimmond, 137 F.3d 823, 833 (4th Cir. 1998)). The exhibits' probative value easily outweighs any potential unfair prejudice.
In short, we have no trouble holding that any evidentiary error by the district court was harmless, considering the extensive evidence of Perwaiz's fraudulent conduct.
B.
Turning to Perwaiz's second evidentiary challenge against the patient-witnesses' testimony, we could reject it too on harmlessness grounds. In any event, Perwaiz all but concedes in his reply brief that our decision in United States v. Bajoghli, 785 F.3d 957 (4th Cir. 2015), not only controls this issue but also forecloses his argument on appeal. See Reply Br. at 10-12.
In Bajoghli, which involved a similar healthcare fraud scheme, we held that "the district court abused its discretion in limiting the government's proof to that which is directly relevant to one or more of the 53 executions charged in the indictment, without taking into account the relevance of uncharged conduct to the alleged overarching scheme." 785 F.3d at 964 (emphasis added). We explained that "in a large and complex healthcare-fraud case where the defendant's criminal intent is placed at issue," uncharged but relevant evidence is "intrinsic to the 'scheme' element" and is therefore admissible. Id. (cleaned up).
The patient-witnesses' testimony fits squarely within Bajoghli's holding given that the proof of a scheme to defraud was a required element of the healthcare fraud counts. The testimony in turn spoke directly to the existence of such a scheme and was thus intrinsic and admissible. So we can't find that the district court erred in allowing the testimony.
C.
Finally, we address Perwaiz's argument that his counsel's performance at sentencing was ineffective. An ineffective-assistance claim is permitted on direct appeal (rather than a motion to vacate under 28 U.S.C. § 2255) only "where it conclusively appears in the trial record itself that the defendant was not provided with effective representation." Mandello, 426 F.2d at 1023. Perwaiz makes no such showing, nor does he attempt to argue that his counsel's performance prejudiced him.
Relying on United States v. Cronic, 466 U.S. 648 (1984), Perwaiz maintains that his counsel's performance during sentencing was so deficient that we can presume prejudice. Otherwise, Perwaiz would have to adhere to the traditional two-pronged showing of deficient performance and prejudice under Strickland v. Washington, 466 U.S. 668 (1984).
Cronic permits such a shortcut in limited "circumstances that are so likely to [have] prejudice[d] the accused that the cost of litigating their effect in a particular case is unjustified." 466 U.S. at 658. One such circumstance is the "complete denial of counsel," where "the accused is denied counsel at a critical stage of his trial," or where "counsel entirely fails to subject the prosecution's case to meaningful adversarial testing." Id. at 659.
Cronic's exception-which results in a structural error-requires "an extremely high showing," United States v. Ragin, 820 F.3d 609, 618 (4th Cir. 2016) (cleaned up), and is "exceedingly narrow," United States v. Theodore, 468 F.3d 52, 56 (1st Cir. 2006). To illustrate, we have held Cronic satisfied where defense counsel slept through substantial portions of the trial. Ragin, 820 F.3d at 620. But even there, the defendant raised his ineffective assistance of counsel claim on a § 2255 motion. Id. at 613.
Here, Perwaiz's lawyers submitted a sentencing memorandum, were present (and awake) during sentencing, and spoke on Perwaiz's behalf regarding the § 3553(a) factors. Even if (in Perwaiz's eyes) counsel didn't do enough, he can't argue that they did nothing. At bottom then, any ineffective assistance rendered by Perwaiz's counsel doesn't "conclusively appear[] in the trial record." Mandello, 426 F.2d at 1023. Postconviction proceedings are therefore a better vehicle for that claim.
* * *
For these reasons, we affirm the district court's judgment. And we dispense with oral argument because the facts and legal contentions are adequately presented in the materials before this court and argument would not aid in the decisional process.
AFFIRMED