Court emphasizes need to preserve issues in affirming pharmacist's convictions

United States v. Otuonye, 2021 WL 1743226 (10th Cir., May 4, 2021) (KS): Otuonye was a pharmacist that filled prescriptions at his pharmacy, Neighborhood Pharmacy, written by Dr. Henson for opioids and other control substances. The DEA investigated and Otuonye was indicted for conspiring to unlawfully distribute controlled substances; unlawfully distributing controlled substances; and Medicare and Medicad fraud. A jury convicted him on all four counts and the district court sentenced him to 150 months in prison. On appeal he challenged the admission of certain evidence, the sufficiency of the evidence and the unreasonableness of the court’s sentencing procedure. The panel rejected all of his arguments and stressed the importance of making precise objections and specific arguments in the district court in order to preserve an issue for appeal. Otuonye made 5 evidentiary arguments. First, he said the court incorrectly found Henson was his co-conspirator and therefore his statements were inadmissible under Fed.R.Evid. 801(d)(2)(E). The panel said the district court did not clearly err. A court decides whether these statements are admissible in hearing outside the jury’s presence. There it examines if there is some independent evidence linking the accused to the conspiracy. That evidence must be something other than the proffered co-conspirator statements, but that evidence need not be substantial. Here, there was evidence that a conspiracy existed in that Otuonye knew his pharmacy and Henson’s medical practice were benefitting from Henson’s prescriptions - which was the essential objective of the conspiracy. When other pharmacies rejected Henson’s scripts he referred them to Neighborhood. Naturally the number of prescriptions filled at Otuonye’s increased. Also, Henson and Otuonye communicated during the conspiracy, including when Otuonye asked Henson to also send him three non-controlled substances prescriptions. This he asked for to maintain a certain ratio of non-controlled to controlled sales and thereby avoid scrutiny from his wholesaler and regulators. He also instituted a policy of requiring 3 non-narcotic prescriptions to fill one narcotic prescription. Given this independent evidence, the panel ruled the district court did not clearly err in finding a conspiracy. Second, Otuonye argued the admission of text message exchanges between Henson and his patients violated the Sixth Amendment’s confrontation clause. The panel found that Otuonye had not preserved this issue for appeal because he did not specify whether his objection to this evidence was rooted in the Confrontation Clause or Fed.R.Evid. 802. Counsel said only that the witnesses will not “be on the stand to have any kind of cross-examination.” That is insufficient – counsel must state “the precise ground” for the objection. Third, Otuonye said the district court should not have let the jury hear from Henson’s patients what they did with the controlled substances they bought from Neighborhood. The panel held their testimony that they sold or abused their prescribed opioids was “probative of the fact that the prescriptions lacked a legitimate medical use, an element of the charge against Otuonye.” It also said the evidence was not unfairly prejudicial. It simply illustrated the “foreseeable consequences” of the charge crime. [That might be an argument to make when the government objects your controversial evidence]. Besides, many of the witnesses testified they did not tell Otuonye they were addicts or intended to sell their prescribed opioids. And the defense had the opportunity to question them about Otuonye’s knowledge of their later actions. If Otuonye’s defense was prejudiced, it was minimal, especially when there was more than enough other evidence for the jury to convict him. Fourth, Otuonye argued his case was prejudiced by the admission of cumulative evidence. The panel ruled that he had not shown any cumulative evidence was admitted nor that he was prejudiced by the admission of any such evidence. He also failed to acknowledge that the district court granted some of his cumulative evidence objections and limited the testimony of other witnesses. The panel held Otuonye waived his fifth argument. Since Otuonye raised a different ground for challenging the admission of certain summary exhibits than he did in district court, he forfeited that argument. And because he did not argue for plain error review, the panel finds he waived the issue on appeal. Regarding Otuonye’s sufficiency arguments, the panel holds there was enough evidence for a reasonable jury to find him guilty. Otuonye argued the evidence was insufficient to show that he knew any of Henson’s scripts were illegitimate. Not so, says the panel. Henson and Otuonye met in October 2014. Henson referred patients to Neighborhood when they had trouble filling his scripts at other pharmacies. After October, Otuonye began filling many more scripts for Henson patients and charging them more, thereby substantially increasing his revenue. There also were ‘red flags’ that should have alerted Otuonye that Henson scripts were “outside the usual course of professional medical practice and without a legitimate medical purpose.” Those included: the quantities, strength, types and combination of drugs Henson prescribed; that his patients often paid in cash; that they drove long distances to Neighborhood; and that Otuonye’s relief pharmacist raised these “red flags” with him. The panel said Otuonye’s challenge to the knowledge element of the distribution charge fails for a similar reason. Multiple pharmacists testified these “red flags” should have alerted Otuonye that Henson’s prescriptions did not have a legitimate medical purpose. Given this testimony, it was reasonable for the jury to conclude that Otuonye in dispensing these opioids, he was “willfully blind to the criminality of his behavior.” That evidence of deliberate ignorance was also enough to sustain the Medicare and Medicaid fraud convictions. The panel held that prescriptions that are issued without a legitimate medical purpose are not valid. In submitting them for reimbursement, when he knew or should have known they were illegitimate, Otuonye falsely represented that they were valid. He had no lawful claim to the money he received from these programs. Finally, the panel ruled Otuonye waived his sentencing issue. At sentencing and on appeal he argued that the district court failed to correctly calculate his guidelines because the court assumed all Henson’s scripts lacked a medical purpose despite trial testimony to the contrary. The district court never ruled on this issue but Otuonye did not object to its omission on Fed.R.Crim.P. 32(i)(3)(B) grounds, which requires a court to rule on “any controverted matter.” Thus, he forfeited the issue and by not arguing for plain error review, waived it on appeal.