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United States v. Barnwal

United States District Court, E.D. Michigan, Southern Division

April 3, 2019




         In this health care fraud case, Defendants Seema Barnwal and Krishna Baranwal are charged in an indictment with four counts relating to their alleged scheme to pay kickbacks in violation of federal health care laws. Defendants are charged with participating in significant health care fraud and kickback schemes at Magnum Home Health Care, Inc., a home health care agency owned by Defendants. Counts one and two of the indictment charge that Defendants willfully formed and carried out a conspiracy to commit healthcare fraud in violation of 18 U.S.C. § 1349, and a conspiracy to pay and receive health care kickbacks in violation of 18 U.S.C. § 371. Counts three and four charge the Defendants with paying kickbacks in connection with a federal health care program in violation of 18 U.S.C. § 1320a-7b(b)(2). Defendants are alleged to have carried out their conspiracy from approximately 2012 through May 2018.

         Pending before the Court are three motions filed jointly by Defendants: Defendants' motion to suppress (ECF No. 31), Defendants' motion to dismiss the indictment (ECF No. 29), and Defendants' motion for a bill of particulars (ECF No. 30). The government opposes the motions. On January 10, 2019, the Court held a hearing in connection with the motions and took the motions under advisement. Having carefully reviewed the record in this matter and after considering the argument of counsel presented at the hearing, for the reasons set forth below, the Court DENIES Defendants' motion to suppress, DENIES Defendants' motion to dismiss without prejudice, and GRANTS IN PART Defendants' motion for a bill of particulars.

         I. Defendants' Motion to Suppress

         On May 25, 2018, government investigators executed search warrants at Defendants' residence and place of work. Defendants share both a residence and a place of work. The search warrants, which are identical, authorized the seizure of a laundry list of records, documents, information, and data, including computer equipment and storage devices as well as any of the data contained therein related to Defendants' home health care enterprise.

         Defendants move to suppress all evidence seized as a result of the search warrants. With respect to their residence, Defendants contend that the search warrant affidavit failed to establish probable cause to believe that evidence of a crime would be found at their residence. Defendants further argue that the search warrants are constitutionally overbroad in terms of both the scope of the items and the time frame covered. The Government responds that the affidavit submitted in support of the search warrants sufficiently establishes probable cause, and that the items seized pursuant to the warrant are relevant to the criminal activity charged in this case.

         In order to determine if the search warrant affidavit established probable cause, the Court must look to the totality of the circumstances, including the veracity and basis of knowledge of persons supplying the information. See Illinois v. Gates, 462 U.S. 213, (1983). “Probable cause exists when there is a fair probability, given the totality of the circumstances, that contraband or evidence of a crime will be found in a particular place.” United States v. Davidson, 936 F.2d 856, 859 (6th Cir.1991) (internal quotation marks and citation omitted). “[R]eviewing courts are to accord the magistrate's [probable cause] determination great deference.” United States v. Allen, 211 F.3d 970, 973 (6th Cir. 2000) (en banc) (internal quotation marks and citation omitted).

         Here, the affidavit submitted in connection with the search warrants establishes sufficient probable cause for the seizure of evidence, contraband, fruits, and instrumentalities of Defendants' alleged crimes from 2010 through 2018. The evidence provided in the affidavit demonstrates that Defendants formed their home health care business in 2009. Given that the statements of the cooperating witnesses indicated that a fully developed kickback scheme was in place as of 2015, it was reasonable for the magistrate judge to find that there was probable cause to search Defendants' records and property for evidence of the conspiracy and fraud from before 2015. See, e.g., United States v. Bli, 147 F.Supp.2d 734, 742 (E.D. Mich. 2001); United States v. Roos, 2013 WL 1136638, at *9 (E.D. Ky. Jan. 24, 2013), report and recommendation adopted, 2013 WL 1136629 (E.D. Ky. Mar. 18, 2013) (“Because no information was available to limit the warrant to a particular time period, the warrant was not overbroad.”). Moreover, even if the affidavit did not establish probable cause to search records from the 2010 time period, evidence of Defendants' related and prior business practices may be relevant to the later formed criminal conspiracy and thus were properly seized pursuant to the search warrants. See United States v. Abboud, 438 F.3d 554, 576 n. 7 (6th Cir. 2006) (“[E]vidence that dated from outside of the time period may be relevant to the activity within the time period.”).

         The affidavit also supports the scope of items seized pursuant to the search warrants. It is well settled that items to be seized pursuant to a search warrant must be described with particularity to prevent “the seizure of one thing under a warrant describing another.” Marron v. United States, 275 U.S. 192, 196 (1927); see Andresen v. Maryland, 427 U.S. 463, 480 (1976). However, the Sixth Circuit has recognized that the degree of specificity in a warrant must be flexible, depending upon the type of items to be seized and the crime involved. See United States v. Ables, 167 F.3d 1021, 1033 (6th Cir. 1998). “Thus[, ] a description is valid if it is as specific as the circumstances and the nature of the activity under investigation permit.” Id.; see United States v. Blair, 214 F.3d 690, 697 (6th Cir. 2000).

         For example, in Blair the warrant described the items to be seized as “[b]ooks, records, receipts, notes, ledgers, airline tickets, money orders, passports, and other papers relating to the transportation, importation, ordering, sale, and distribution of controlled substances.” Blair, 214 F.3d at 697. The warrant also authorized seizure of records of financial transactions and electronic equipment used to aid the defendants in their drug trafficking activities. Id. The Sixth Circuit concluded that the warrant did not violate the particularity requirement of the Fourth Amendment because the records and items sought were those related to the defendant's drug-trafficking activities. Id. Relying on Blair, in Elhorr, this Court found that a search warrant was sufficiently particular where it sought several categories of records specifically related to the criminal activity being investigated-fraudulent Medicare billing.

         Applying the reasoning of Blair and Elhorr, the same result is reached here. All of the items identified in the indictment were tied to or related to potential instruments of Defendants' alleged health care fraud scheme. The search warrants did not violate the particularity requirement of the Fourth Amendment.

         The affidavit also sufficiently establishes a nexus to search the Defendants' residence. The affidavit provided evidence that Defendants brought work related materials to their home and that they received work related materials through the mail at their home. Defendants fail to demonstrate that probable cause was lacking to conduct the search of their home.

         Finally, contrary to Defendants' arguments here, the search warrant affidavit at issue is supported by more than mere suspicions or beliefs, and does in fact contain the underlying factual circumstances of Defendants' criminal activity. The affidavit cannot be characterized as a “bare bones” affidavit. See United States v. Weaver, 99 F.3d 1372, 1378 (6th Cir. 1996) (describing a “bare bones” affidavit as one “that states suspicions, beliefs, or conclusions, without providing some underlying factual circumstances regarding veracity, reliability, and basis of knowledge.”). Thus, even if the search warrant was found to be defective, the Leon good faith exception applies. See United States v. Leon, 468 U.S. 897 (1984); United States v. Evers, 669 F.3d 645, 654 (6th Cir. 2012) (rejecting the defendant's argument that search warrant affidavit was “bare bones” and holding that the Leon good-faith exception “which allows admission of evidence seized in reasonable, good-faith reliance on a search warrant that is subsequently held to be defective” would apply). For these reasons, Defendants' motion to suppress is denied.

         II. Motion to ...

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