                                       No. 04-5310
                                 File Name: 05a0523n.06
                                   Filed: June 17, 2005

                         UNITED STATES COURT OF APPEALS
                              FOR THE SIXTH CIRCUIT

UNITED STATES OF AMERICA,                          )
                                                   )
   Plaintiff-Appellee,                             )
                                                   )   ON APPEAL FROM THE
       v.                                          )   UNITED STATES DISTRICT
                                                   )   COURT FOR THE EASTERN
ROBERT M. CANON, M.D.,                             )   DISTRICT OF TENNESSEE
                                                   )
   Defendant-Appellant.                            )



Before:       NELSON and BATCHELDER, Circuit Judges, and O’MALLEY, District
              Judge.*


       DAVID A. NELSON, Circuit Judge. A jury found the defendant, a medical doctor,

guilty of submitting fraudulent healthcare claims and making false statements in relation to

healthcare matters. The defendant was sentenced to imprisonment for 41 months, and he has

appealed the judgment of conviction and sentence .

       The defendant raises five issues: (1) whether the district court abused its discretion

by posing questions from jury members to one of the government’s expert witnesses and

allowing the government to recall the expert as a rebuttal witness; (2) whether the court

abused its discretion by admitting certain evidence; (3) whether the cumulative effect of the



       *
        The Honorable Kathleen M. O’Malley, United States District Judge for the Northern
District of Ohio, sitting by designation.
No. 04-5310
Page 2

court’s allegedly erroneous evidentiary rulings was to deprive the defendant of a fair trial;

(4) whether there was sufficient evidence to support the defendant’s convictions for making

false statements; and (5) whether enhancement of the defendant’s sentence on the basis of

judicially determined facts violated the Sixth Amendment right to a jury trial.

       We are not persuaded that the district court committed any error requiring reversal of

the conviction. Under United States v. Booker, 543 U.S. ___, 125 S. Ct. 738 (2005), and

United States v. Oliver, 397 F.3d 369 (6th Cir. 2005), however, the enhancement of the

defendant’s sentence was plainly erroneous and requires a remand for resentencing.


                                              I


       The defendant, Robert M. Canon, M.D., is an orthopedic surgeon. He operated an

office-based clinic for the management of neck and back pain. Dr. Canon’s practice

consisted primarily of giving injections of anti-inflammatory medications and steroids.

       In September of 2002 a federal grand jury handed up an indictment charging Dr.

Canon with 50 counts of healthcare fraud (violations of 18 U.S.C. § 1347) and 45 counts of

making false statements in relation to healthcare matters (violations of 18 U.S.C. § 1035).

The fraud counts charged that Dr. Canon billed Medicare and other healthcare benefit

programs for “nerve block” injections when he had in fact administered “trigger point”
No. 04-5310
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injections.1 Medicare pays physicians significantly less for the latter procedure than for the

former. The “false statement” counts charged that Dr. Canon misrepresented, through his

use of billing codes and modifiers, the extent of the services he had provided to several

patients. The total amount of Dr. Canon’s fraudulent billings, according to the indictment,

was $3,858,750.38.

         A jury found Dr. Canon guilty of all charges. The doctor moved for a judgment of

acquittal, arguing that the evidence was insufficient to support the jury’s verdict, and for a

new trial, arguing that the verdict was against the weight of the evidence and that several of

the district court’s evidentiary rulings were erroneous. The motions were denied.

         At sentencing the government presented evidence that the total amount of Dr. Canon’s

fraudulent billings came to $3,183,710. The district court accepted that figure. The result

was a 13-level increase in Dr. Canon’s base offense level under U.S.S.G. § 2F1.1(b)(1)(N)

(2000 edition). The court also found that Dr. Canon’s offenses involved more than minimal

planning and had more than one victim. These findings resulted in an additional two-level

increase under § 2F1.1(b)(2) of the guidelines. The adjusted offense level yielded a guideline

sentence range of imprisonment for 37 to 46 months. The court denied a defense motion for

a downward departure and sentenced Dr. Canon to 41 months, the mid-point of the guideline

range.


         1
        A nerve block injection delivers medication directly to the affected nerve. It involves
the insertion of a needle into or very near the joint between adjacent vertebrae. A trigger
point injection delivers medication into muscular tissue.
No. 04-5310
Page 4

       Dr. Canon perfected a timely appeal. He is free on bond pending the completion of

the appellate process.


                                               II


       Stephen Minore, M.D., testified at trial as an expert witness for the prosecution. After

describing how he himself performs nerve blocks, Dr. Minore expressed the opinion, based

on a review of patients’ records, that the procedures performed by Dr. Canon were trigger

point injections and not nerve blocks.

       After a break in Dr. Minore’s direct examination, the district court announced that

some jurors had volunteered that they would like to ask questions. The court said that it

would allow jurors to submit written questions, and that the court would then pose any

questions it determined to be “appropriate.”

       Later, after Dr. Minore had been cross-examined but before any re-direct, the district

court informed the parties’ lawyers at sidebar that the jury had submitted questions for the

witness. Over objection from counsel for Dr. Canon, the court asked Dr. Minore two quite

pertinent questions “distilled” from those submitted by the jury. The parties were permitted

to ask follow-up questions, and the defense did so. Dr. Canon now argues that the district

court abused its discretion by posing the jury’s questions to Dr. Minore.

       This court has held that “allowing jurors to ask questions during criminal trials is

permissible and best left to the discretion of the trial judge,” although “the routine practice
No. 04-5310
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of juror questioning should be discouraged.” United States v. Collins, 226 F.3d 457, 461 (6th

Cir. 2000), cert. denied, 531 U.S. 1099 (2001). A number of precautions should be taken if

a district court decides to allow questioning by the jury:

       “When a court decides to allow juror questions, counsel should be promptly
       informed. At the beginning of the trial, jurors should be instructed that they
       will be allowed to submit questions, limited to important points, and informed
       of the manner by which they may do so. The court should explain that, if the
       jurors do submit questions, some proposed questions may not be asked
       because they are prohibited by the rules of evidence, or may be rephrased to
       comply with the rules. The jurors should be informed that a questioning juror
       should not draw any conclusions from the rephrasing of or failure to ask a
       proposed question. Jurors should submit their questions in writing without
       disclosing the content to other jurors. The court and the attorneys should then
       review the questions away from the jurors’ hearing, at which time the attorneys
       should be allowed an opportunity to present any objections. The court may
       modify a question if necessary. When the court determines that a juror
       question should be asked, it is the judge who should pose the question to the
       witness.” Id. at 464.

       In the case at bar the initiative for allowing juror questions came from the jurors

themselves, not from the court. The request was dealt with in a manner consistent with

Collins, a case where the initiative had came from the court.

       When jurors in the case at bar indicated that they would like to ask questions, the

court promptly notified the parties that it would entertain such questions. The court then told

the jurors that they could submit “really important” questions in writing, and it warned them

that some questions might not be appropriate because of “the rules of evidence.” The court

reviewed the jury’s questions with the lawyers away from the jury’s hearing, and the lawyers
No. 04-5310
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were given an opportunity to object. Finally, the court itself posed the questions to the

witness.

       Dr. Canon argues that the Collins safeguards are insufficient when the witness is an

expert testifying for the prosecution. Emphasizing that the jury did not submit questions for

any other witness, he contends that juror questioning of Dr. Minore “could only have tended

to forge a sort of ‘alliance’ between Dr. Minore and the jury.”

       We do not think the risk of such an “alliance” was so great that the district court could

not reasonably choose to allow the questioning. Neither do we think that the court abused

its discretion by posing the jury’s questions before the government’s re-direct of Dr. Minore.

       Dr. Canon argues further that the alleged error of allowing juror questioning was

compounded by the district court’s letting the government recall Dr. Minore as a rebuttal

witness. But Dr. Canon concedes that “the recall of Dr. Minore may not have been reversible

error viewed in isolation,” and given the fact that there was no error to compound as far as

jury questioning was concerned, the decision to allow Dr. Minore to be recalled did not

necessitate the granting of a new trial.
No. 04-5310
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                                              III


                                               A


       Joan Syler, an investigator for Blue Cross-Blue Shield of Tennessee, testified at trial

about a telephone conversation she had with Ellen Harrison, a billing consultant who had

been hired by Dr. Canon. According to Ms. Syler, Ms. Harrison said that Dr. Canon was

“upcoding” his office visits and did not seem to listen to Harrison’s recommendations.

Objections to this testimony under Rules 404(b) and 802, Fed. R. Evid., were overruled.

       Ms. Syler’s testimony does not appear to have been offered as “other acts” evidence

in violation of Rule 404(b). The testimony was offered, rather, to show that Dr. Canon

engaged in a continuing fraudulent scheme of which the specific billings listed in the

indictment were a part. Significantly, the conversation between Ms. Harrison and Ms. Syler

occurred within the time period during which the fraudulent scheme was alleged to have been

in operation. We see no violation of Rule 404(b) here.

       On the other hand, it is a little hard to see why Ms. Syler’s testimony should not have

been excluded as hearsay under Rule 802. The government cites Rule 801(d)(2)(D), Fed. R.

Evid., which provides that a statement is not hearsay if (1) it is offered against a party, (2)

it is a statement by that party’s agent or servant, (3) it concerns a matter within the scope of

the agency or employment, and (4) it was made during the existence of the relationship. But

it is far from clear to us that Ms. Harrison, an outside consultant, was Dr. Canon’s agent.
No. 04-5310
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       We need not resolve that question, however, because Dr. Canon has not shown that

he was significantly prejudiced by the admission of Ms. Syler’s testimony. The defense

called Ms. Harrison as a witness, and she gave her own account of the conversation with Ms.

Syler. As we have said elsewhere, “[t]he hearsay dangers underlying out-of-court statements

offered for their truth – sincerity, memory and not under oath – are not present when the

declarant takes the stand as a witness.” Moore v. KUKA Welding Systems & Robot Corp.,

171 F.3d 1073, 1081-82 (6th Cir. 1999). Ms. Harrison’s testimony at trial was sufficient to

cure any error in the admission of the out-of-court statements.


                                              B


       Lana Lasater, a sometime Canon clinic employee who had gone on to work for

another orthopedic surgeon, testified that the other surgeon occasionally performed the same

sort of procedures that Dr. Canon performed. Ms. Lasater was then asked how those

procedures were billed by the other surgeon.       An objection on relevance grounds was

overruled. Ms. Lasater testified that the other surgeon billed the procedures as trigger point

injections.

       Ms. Lasater’s testimony strikes us as plainly relevant. Evidence that the procedures

Dr. Canon billed as nerve blocks were billed by another orthopedic surgeon as trigger point

injections makes it more probable that Dr. Canon’s billings were fraudulent. See Fed. R.

Evid. 401 (defining “relevant evidence”).
No. 04-5310
Page 9

       On appeal, Dr. Canon argues that Ms. Lasater was not qualified to testify that the

differently-billed procedures were in fact the same. This argument was not presented to the

district court. (Indeed, Dr. Canon did not object at all when Ms. Lasater was asked whether

the other surgeon performed the same procedures.) Moreover, we think that Ms. Lasater

could properly testify to her perception that the procedures were the same. This was factual

testimony about what she saw, not technical or scientific testimony. Finally, any flaws in

Ms. Lasater’s perception could have been probed on cross-examination. We see no abuse

of discretion in allowing Ms. Lasater to testify as she did.


                                              C


       The testimony of Amanda Smith, another former employee of Dr. Canon’s clinic, was

admitted at trial in the form of a videotaped deposition. Dr. Canon objected before trial to

the admission of numerous portions of Ms. Smith’s testimony, but the district court sustained

only one of the objections. In the testimony that was admitted Ms. Smith said, among other

things, that she took x-rays and performed physical therapy for Dr. Canon despite having

only minimal training; that Dr. Canon’s “bank called a lot;” and that she did not mention Dr.

Canon’s billing practices when interviewed by an investigator because she did not want to

be fired. Dr. Canon argues that the admission of this testimony violated Rules 404(b) and

403, Fed. R. Evid.
No. 04-5310
Page 10

       It seems to us that none of the evidence in question was Rule 404(b) evidence, i.e.,

evidence of other acts offered “to prove the character of a person in order to show action in

conformity therewith.” None of challenged testimony relates to other instances of fraud or

the making of false statements.

       On the other hand, the testimony concerning Ms. Smith’s job duties and Dr. Canon’s

bank had little probative value, and it might have unfairly prejudiced Dr. Canon because of

its tendency to suggest that he provides substandard care and does not pay his debts. The

challenged testimony could probably have been excluded under Rule 403. That strikes us

as a close call, however, and we are not prepared to say that the district court abused its

discretion in allowing the testimony to come in.

       As for Ms. Smith’s testimony that she had kept quiet about Dr. Canon’s billing

practices to avoid being fired – testimony elicited by Dr. Canon’s own lawyer – exclusion

was not required. Dr. Canon contends that the testimony was non-responsive, but we think

that the witness was entitled to explain her answer when asked repeatedly whether she had

mentioned Dr. Canon’s billing practices to the investigator. Again, we are not persuaded that

there was an abuse of discretion.


                                             IV


       Dr. Canon argues that the cumulative effect of the district court’s evidentiary rulings

was to deny him a fair trial. It is true that “trial-level errors that would be considered
No. 04-5310
Page 11

harmless when viewed in isolation of each other might, when considered cumulatively,

require reversal of a conviction.” Campbell v. United States, 364 F.3d 727, 736 (6th Cir.

2004), cert. denied, 125 S.Ct. 987 (2005). As we have indicated, however, we think that

only one of the district court’s evidentiary decisions – its decision to admit Joan Syler’s

testimony as non-hearsay – may have been in error. Absent additional errors, there can be

no prejudicial cumulative effect. See id. (holding that an “accumulation of non-errors” will

not warrant a new trial).


                                                V


       Dr. Canon challenges the sufficiency of the evidence that he billed for unperformed

services on the specific dates, and for the specific patients, listed in the false-statement counts

of the indictment (counts 51 through 95). Our task is to determine “whether, after viewing

the evidence in the light most favorable to the prosecution, any rational trier of fact could

have found the essential elements of the crime beyond a reasonable doubt.” Jackson v.

Virginia, 443 U.S. 307, 319 (1979).

       To establish Dr. Canon’s guilt as to counts 51 through 95, the government had to

prove that he knowingly and willfully made false statements “in connection with the delivery

of or payment for health care benefits, items, or services” and in a “matter involving a health

care benefit program.” 18 U.S.C. § 1035(a)(2). More specifically, the government had to
No. 04-5310
Page 12

prove that Dr. Canon knowingly overstated the extent of the services he provided on the

dates listed in the indictment.

       The government focused on Dr. Canon’s use of a particular billing code, 99214-25.

The first part of the code, 99214, denotes a “level four” office visit, with level one being the

least extensive and level five being the most. The “-25" modifier denotes an additional,

separate service performed during the office visit. At trial, Dr. Canon admitted that he knew

he should not bill for both an injection and an office visit – i.e., use billing code 99214-25

– unless he had provided a significant service that was separate from the injection. He

maintained that he nearly always performed a separate service when seeing a patient to

administer a shot. But one of the government’s expert witnesses, Joanne Mehmert, testified

that she had reviewed Dr. Canon’s patient records for the dates listed in the indictment and

that the documentation did not support Dr. Canon’s use of the 99214-25 billing code on those

dates. Her opinions were summarized in a chart that was admitted into evidence.

       This evidence was sufficient, we believe, to support the jury’s verdict. Dr. Canon

argues that proof of a failure to document separate services does not amount to proof of a

failure to perform those services. We think, however, that a rational jury could infer a failure

to perform from a failure to document. Such an inference is supported by the testimony of

other witnesses concerning the importance of chart documentation, as well as Dr. Canon’s

own testimony that he knew he needed to document any additional services. A finding that

Dr. Canon did not perform all of the services for which he billed is consistent, moreover,
No. 04-5310
Page 13

with Dr. Minore’s testimony that the 99214-25 billing code is rarely used in a typical pain-

management practice.

       The government’s case on counts 51 through 95 would have been stronger, to be sure,

had the government presented unequivocal patient testimony to the effect that Dr. Canon did

no more than administer injections on the dates in question. Speculation as to the availability

of additional evidence, however, does not render the existing evidence insufficient. The

government’s case might not have been overwhelming, but we are satisfied that it was

enough to support a verdict of guilty on counts 51 through 95.


                                               VI


       In United States v. Booker, 543 U.S. ___, 125 S. Ct. 738 (2005), the Supreme Court

held that the Sixth Amendment forbids judicial determination of “[a]ny fact (other than a

prior conviction) which is necessary to support a sentence exceeding the maximum

authorized by the facts established by a plea of guilty or a jury verdict . . . .” Booker, 125 S.

Ct. at 756. In the case at bar the district court’s factual determinations were necessary to

support the 41-month sentence that the court imposed; absent those determinations, Dr.

Canon’s guideline sentence range would have been zero to six months. See U.S.S.G. Ch. 5,

Pt. A (2000). Accordingly, Dr. Canon’s sentence violates the Sixth Amendment as construed

in Booker.
No. 04-5310
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       Dr. Canon did not make a Sixth Amendment argument in the district court. But our

court has recently held that a Sixth Amendment violation under Booker constitutes “plain

error” that may be corrected on appeal despite its forfeiture below. See United States v.

Oliver, 397 F.3d 369, 378-81 (6th Cir. 2005). Under Oliver, this case must be remanded to

the district court for resentencing. See id. at 381.

       On remand, of course, the district court will be free to consider again enhancing Dr.

Cannon’s offense level under the guidelines as long as the resultant sentencing range is

treated as advisory rather than mandatory. And in determining what constitutes a reasonable

sentence for this defendant under 18 U.S.C. 3553(a), the district court may consider all of

the facts that led to the enhancements imposed originally.

       Dr. Canon’s convictions are AFFIRMED, his sentence is VACATED, and the case

is REMANDED for resentencing.
