Opinion
Nos. 02 Civ. 8449 (JGK), S1 98 Cr. 1302 (JGK).
August 12, 2005
OPINION and ORDER
The petitioner, Brij Mittal, was convicted of participating in a kickback scheme in connection with the Medicare program in violation of 42 U.S.C. § 1320a-7b(b)(1) and (2). He now moves pursuant to 28 U.S.C. § 2255 to vacate his conviction on the grounds of ineffective assistance of counsel.
The petitioner alleges that his trial counsel, Mark Marcus, Esq., suffered from a medical condition called obstructive sleep apnea, and that the sleep apnea prevented defense counsel from fully investigating and preparing the petitioner's case. Specifically, the petitioner contends that his counsel's medical condition prevented him: (1) from fully investigating whether the indictment returned by the grand jury was presented in open court; (2) from preparing certain witnesses who were called and from fully investigating whether to call certain other witnesses who were not; and (3) from failing to investigate and introduce evidence that allegedly could have supported a defense based on a safe harbor provision that exempts remuneration in a bona fide employer-employee relationship from prosecution under the Medicare anti-kickback statute.
A § 2255 motion was originally filed on October 22, 2002 and was later amended. The petitioner has filed a second amended § 2255 motion, which incorporates by reference all of the facts and arguments set forth in his first amended motion. The petitioner's initial § 2255 motion similarly argued ineffective assistance counsel on the grounds that Marcus:
(1) failed to object on the grounds that the indictment was not returned in open court;
(2) failed to advise the petitioner properly about entering a guilty plea in exchange for a lower sentence;
(3) suffered from severe obstructive sleep apnea, which prevented him from conducting a reasonable pretrial investigation and from interviewing and calling potential witnesses; and
(4) failed to call witnesses and make the argument that Mittal's conduct fell within the safe harbor provisions because Mittal was serving as a "referral service" as defined in 42 C.F.R. § 1001.952(f);
(5) provided ineffective assistance of counsel at sentencing by not objecting, among other things, to the computation of the base offense level.
In addition, the initial petition challenged the sentence imposed on due process grounds. The petitioner argued that the Court's calculation of the base offense level for sentencing should have accounted for the fact that Mittal's referrals were for necessary services and that the charges for the services were reasonable.
The first amended petition only asserts claims of ineffective assistance of counsel. Two arguments in the amended motion are the same as in the original § 2255 motion: the failure to object to the return of the grand jury indictment and the failure to investigate and call certain witnesses. The original "safe harbor" argument has been altered from the argument presented in the original petition. Instead of arguing that Mittal was operating a referral service (which is exempt under 42 C.F.R. § 1001.952(f)), the first amended motion argues that any payments were in the context of a bona fide employer-employee relationship (which is exempt under 42 C.F.R. § 1001.952(i)).
Mittal submitted an affidavit in connection with the initial § 2255 motion, and that affidavit was resubmitted without alteration along with the amended motion. There are thus assertions made in the affidavit that are not relevant to, and at times are in tension with, the claims raised in the amended motion.
The petitioner also alleges that Marcus was in association with Mohammed Rafikian, a/k/a "Mo Kian," who held himself out as a law partner of Marcus at the law firm of Marcus and Associates. The petitioner has submitted a declaration stating that he had "many discussions" with Rafikian about his criminal case and that he considered Rafikian to be "as much his lawyer as Mr. Marcus." (See Ex. A (undated Decl. of Brij Mittal ("Second Decl.") ¶ 4 attached to Second Am. Mem. of Law in Supp. of Mot. to Vacate, Set Aside or Correct Sentence Pursuant to Title 28, United States Code Section 2255 ("Second Pet'r Mem.").) The petitioner alleges that he has made payments of over $300,000 in legal fees and that neither Marcus nor Rafikian has ever accounted for $119,000 that was placed in an escrow account but is now gone. (Id. ¶ 8.)
The petitioner represents that Rafikian has been indicted in Queens County, New York. In the complaint filed against Rafikian in Queens County, it is alleged that Rafikian represented himself to be an attorney, and that Rafikian defrauded Mittal out of more than $3.4 million, which Rafikian allegedly promised to invest at a promised 26% rate of return. (See Ex. C attached to Second Pet'r Mem.) The petitioner attaches copies of various business cards to this declaration, including First Investor Capital cards that display Mo. R. Kian as the "CEO, Chairman" and Mark Marcus as Vice President — Compliance of First Investors Capital. (See Ex. A attached to Second Pet'r Mem.)
In addition to the allegations of ineffective assistance contained in the first amended motion, the petitioner added a new claim in his second amended motion, namely, that his trial counsel had an actual conflict of interest because of Rafikian's alleged investment scheme. The petitioner alleges that Marcus and Rafikian failed to pursue a plea bargain, in part, to allow Rafikian to carry on the alleged investment fraud.
I.
The facts underlying this petition have previously been detailed in two earlier opinions issued by this Court: United States v. Mittal, No. 98 Cr. 1302, 1999 WL 461293 (S.D.N.Y. July 7, 1999) (denying defendant's pretrial motions to dismiss indictment, among other things), and United States v. Mittal, No. 98 Cr. 1302, 2000 WL 160799 (S.D.N.Y. Oct. 27, 2000). See also United States v. Mittal, No. 01-1318, 2002 WL 1275105 (2d Cir. June 10, 2002) (affirming conviction on direct appeal). Familiarity with these decisions is presumed, although the operative facts are described herein as necessary.
The indictment charged that from in or about October 1990 through 1997, the petitioner, a medical doctor licensed by the State of New York, together with others known and unknown, knowingly conspired to violate provisions of the Medicare anti-kickback statute, 42 U.S.C. § 1320a-7b(b)(1), (2). As an object of the alleged conspiracy, the petitioner solicited and received remuneration, including kickbacks, bribes, and rebates, in return for referring patients to Ganesh Surgical Supplies ("Ganesh") and American Open MRI Center Inc. ("American Open") for equipment and services covered in whole or in part by the Medicare program. Ganesh and American Open were both Medicare-approved providers owned and operated by Niranjan Patel and Josh Goldstein. Ganesh was a supplier of durable medical equipment while American Open performed magnetic resonant imaging ("MRIs") and CAT scans. Count One charged the petitioner with conspiracy to violate 42 U.S.C. § 1320a-7b(b)(1) and (2) in violation of 18 U.S.C. § 371. Counts Two through Four charged substantive violations of § 1320a-7b(b)(1): namely, that the defendant solicited and received kickbacks from Patel on September 5, 1997 in the amount of $4970 (Count Two), on January 14, 1998 in the amount of $9300 (Count Three), and on February 13, 1998 in the amount of $4140 (Count Four).
On April 17, 2000, after a trial before this Court, the jury returned a verdict of guilty on all four counts of the indictment. The Government at trial presented compelling evidence of the conspiracy and of the three payments, which were made by Patel after he had begun cooperating with Government. The payments were carefully documented, and audio tapes and transcripts of the meetings during which the payments were made were created under the supervision of the Federal Bureau of Investigation ("FBI"). The tapes and transcripts were introduced at trial, and the defendant's own words on those tapes provided substantial evidence of the kickback scheme. The Government called Patel as a witness, who unambiguously incriminated the defendant and testified that he personally paid kickbacks to the defendant over many years. (See, e.g., Tr. 531-80.) The Government also called Patel's nephew who testified that he personally delivered cash kickbacks to the defendant on a number of occasions on behalf of his uncle. (See Tr. 1484-88.)
In addition, powerful evidence that the petitioner knew his conduct was unlawful came from Dr. Pritpal Kang, who testified that in 1993, he, Mittal, and another doctor sought legal advice regarding a diagnostic center that they jointly owned. (See Tr. at 718-19); see also Mittal, 2002 WL 1275105, at *2 (citing Kang's testimony as evidence of Mittal's mens rea). An attorney, Edward S. Kornreich, Esq., met with them for a couple of hours and then sent a letter, dated February 5, 1993, summarizing what they had discussed and providing legal advice on those matters. (See Gov't Ex. 27; Tr. at 733-38.) Among other things, the letter described the Medicare anti-kickback provisions and the safe harbors under the statute. Kang testified that the letter accurately reflected what was discussed with the attorney, and he also testified that he spoke with Mittal about the contents of the letter soon after receiving it. (Tr. at 736-37.)
Following the return of the jury verdict, the petitioner moved for a new trial pursuant to Rule 33 of the Federal Rules of Criminal Procedure on the grounds that he received ineffective assistance of counsel at trial. See generally Mittal, 2000 WL 1610799. Among other things, the petitioner complained of deficiencies in his counsel's performance in the opening statement, in cross-examinations, and in closing argument. Particularly relevant for the purposes of this § 2255 motion, the petitioner also alleged that his counsel was ineffective in failing to interview, prepare, and call certain witnesses and potential witnesses. The petitioner further alleged that defense counsel slept during the trial. Trial counsel, Mark Marcus, submitted a letter supporting the motion on the grounds that poor health inhibited his performance. The Court denied the Rule 33 motion, rejecting in detail each of the defendant's assertions that defense counsel provided ineffective assistance of counsel. The Court repeatedly emphasized that the defendant was unable to show that he was prejudiced by trial counsel's performance, and it found that the alleged instances of Marcus sleeping during trial — which Marcus at the time denied — were insufficient to warrant a new trial. As the Court noted: "In this case trial counsel vigorously participated throughout the trial and was assisted by co-counsel. It was apparent that trial counsel objected in the course of the government examination of witnesses and vigorously cross examined the government witnesses." Mittal, 2000 WL 1610799, at *8. This issue was repeated on appeal and this Court's rejection of the argument was affirmed "substantially for the reasons stated" in this Court's opinion. Mittal, 2002 WL 1275105, at *3.
Indeed, the Court had recognized that Marcus was having health problems (although they were not diagnosed as involving a sleep disorder) and appointed alternate counsel in case Marcus could not continue. The alternate counsel, Mr. Burnett, was present throughout trial, although his participation was limited.
The first amended § 2255 motion and the previous Rule 33 motion differ primarily two respects. First, the first amended § 2255 motion purportedly focuses on trial counsel's alleged deficiencies in preparing for trial and fully investigating the case, whereas the Rule 33 motion focused on counsel's conduct during trial. Second, whereas Marcus had merely submitted an unsworn letter in support of the Rule 33 motion, in connection with the first amended § 2255 motion, the petitioner has submitted a sworn affidavit by Marcus as well as other documents confirming and describing Marcus's health disorder, known as obstructive sleep apnea. (See Exs. B, E attached to Am. Mem. of Law in Supp. of Mot. to Vacate, Set Aside or Correct Sentence Pursuant to Title 28, United States Code Section 2255 ("First Pet'r Mem.").)
II.
This first amended motion pursuant to 28 U.S.C. § 2255 seeks to vacate the petitioner's conviction on the grounds of ineffective assistance of counsel. To establish a claim of ineffective assistance of counsel, the petitioner must show both that: (1) defense counsel's performance was deficient, and (2) that his counsel's deficient performance was prejudicial to the petitioner's defense. See Strickland v. Washington, 466 U.S. 668, 687 (1984); Bunkley v. Meachum, 68 F.3d 1518, 1521 (2d Cir. 1995). A petitioner cannot meet the first prong of this test merely by showing that his counsel employed poor strategy or made a wrong decision. Instead, the petitioner must establish that his counsel "made errors so serious that counsel was not functioning as the `counsel' guaranteed . . . by the Sixth Amendment." See Strickland, 466 U.S. at 687. In fact, there is a "strong presumption" that defense counsel's conduct fell within the broad spectrum of reasonable professional assistance, and a defendant bears the burden of proving "that counsel's representation was unreasonable under prevailing professional norms and that the challenged action was not sound strategy."Kimmelman v. Morrison, 477 U.S. 365, 381 (1986) (citingStrickland, 466 U.S. at 688-89).
To meet the second prong of the Strickland test, the petitioner must show that "[t]here is a reasonable probability that, but for counsel's unprofessional errors, the result of the proceeding would have been different. A reasonable probability is a probability sufficient to undermine confidence in the outcome."Strickland, 466 U.S. at 694; see also Mittal, 2000 WL 1610799, at *3; Ramos v. United States, No. 97 Civ. 2572, 1998 WL 230935, at *3 (S.D.N.Y. May 8, 1998).
At this stage, the issue is whether to afford the petitioner an evidentiary hearing on the claims of ineffective assistance of counsel. Section 2255 provides that the court shall grant a prompt hearing to determine the issues and make findings of fact and conclusions of law "[u]nless the motion and the files and records of the case conclusively show that the prisoner is entitled to no relief." 28 U.S.C. § 2255; see also United States v. Aiello, 900 F.3d 528, 534 (2d Cir. 1990). The petitioner is entitled to a hearing if he can establish "a plausible claim of ineffective assistance of counsel." Armienti v. United States, 234 F.3d 820, 823 (2d Cir. 2000) (internal quotation omitted).
A court may deny a § 2255 motion "without a testimonial hearing where (1) the allegations of the motion, accepted as true, would not entitle the petitioner to relief or (2) the documentary record, including any supplementary submissions such as affidavits, render a testimonial hearing unnecessary." Rosa v. United States, 170 F. Supp. 2d 388, 398 (S.D.N.Y. 2001) (citingChang v. United States, 250 F.3d 79, 84-86 (2d Cir. 2001));United States v. Sappia, Nos. 02 Civ. 649 S 199 Cr. 1193, 2002 WL 620483, at *4, *7-*8 (S.D.N.Y. Apr. 18, 2002) (quotingRosa and finding evidentiary hearing unnecessary where petitioner could not "provide prima facie evidence" that counsel was ineffective for failing to investigate case fully), aff'd mem., No. 00-1792, 2003 WL 22145721 (2d Cir. June 27, 2003). "Where allegations in the petition are immaterial, conclusory and palpably false, there is no basis to conduct an evidentiary hearing." Ortega v. United States, 897 F. Supp. 771, 781-82 (S.D.N.Y. 1995). Moreover, where, as in this case, the petitioner's § 2255 motion is before the same court that tried the criminal case, the court "may rely on its own familiarity with the case and deny the motion" without a hearing if the motion lacks "`meritorious allegations that can be established by competent evidence.'" Stokes v. United States, No. 00 Civ. 1867, 2001 WL 29997, at *2 (S.D.N.Y. Jan. 9, 2001) (quotingAiello, 900 F.2d at 534, which affirmed denial of § 2255 motion without evidentiary hearing where district court "was intimately familiar with the detailed factual record" and determined that allegations were "patently meritless"); Sappia, 2002 WL 620483, at *4 (quoting Stokes, 2001 WL 29997, at *2).
Even where summary dismissal of a § 2255 motion is not warranted, it does not mean that the court must conduct "full-blown testimonial hearing." Chang, 250 F.3d at 85-86 (explaining that § 2255 "does not strip the district courts of all discretion" and describing "a permissible intermediate step" where "the district court [may] proceed by requiring that the record be expanded to include letters, documentary evidence, and, in an appropriate case, even affidavits" (internal quotations omitted)). For the purposes of this motion, in addition to relying on its familiarity with prior proceedings, the Court has accepted and reviewed evidence beyond the record at trial, including an affidavit from the petitioner. (See Ex. A (Decl. of Brij Mittal ("Mittal Decl."), dated October 15, 2003) attached to First Pet'r Mem.) The Court has also reviewed an affidavit from Marcus describing how he suffered from sleep apnea and how, in his opinion, his performance at trial was affected by his medical condition. (See id. Ex. B (Aff. of Mark Marcus, dated Oct. 12, 2001) ("Marcus Aff.") attached to First Pet'r Mem.) Accompanying Marcus's affidavit is a letter from his doctor explaining his sleep disorder (id. Ex. B) and information on sleep apnea generally (id. Ex. E). Additionally, the petitioner submitted the Affidavit of Edward S. Kornreich ("Kornreich Aff."), dated Aug. 12, 2002, in support of the petitioner's claims that he had no knowledge that he was violating the anti-kickback statute. (See id. Ex. C.) In support of the argument with respect to the "safe harbor" provision for remunerations made in the context of a bona fide employee-employer relationship, the petitioner has submitted a copy an employment agreement dated August 10, 1990 between himself and Marie Vadala. (Id. Ex. D.) In response to the petitioner's allegation of ineffective assistance of counsel relating to the return of the grand jury indictment, the Government submitted three affirmations with respect to the procedures followed in returning grand jury indictments.
For the reasons explained below, there is no basis for an evidentiary hearing on the petitioner's first amended motion. Assertions in the petitioner's affidavit can be fully evaluated based on the law and the record at trial. Even accepting as true the statements in the other exhibits submitted in connection with this motion, the petitioner still fails to show that trial counsel's performance in any of the alleged respects was objectively unreasonable and that but for the asserted deficiencies, there is a reasonable probability that the result at trial would have been any different. This Court is fully familiar with the trial record and with the pre-trial and post-trial motions. The Court also heard lengthy oral arguments on both the first and the amended motions pursuant to § 2255. Based on the entire record, it is clear that none of the petitioner's arguments have any merit, and they do not rise to the level warranting an evidentiary hearing on the petitioner's first amended motion.
III.
The petitioner's first argument is based on the premise that there is no proof that the grand jury indictment was returned to a magistrate judge in open court, as required by Rule 6(f) of the Federal Rules of Criminal Procedure. It is clear that the grand jury voted an indictment that was signed by the foreperson. The only question is whether the indictment was announced in open court. The petitioner claims that his counsel was ineffective in failing to investigate whether the indictment was returned in open court and to move to dismiss the indictment in the event that it was not.
The Government has submitted affirmations stating that the usual practice is for an Assistant United States Attorney, at the end of the day, to accompany the grand jury — or the grand jury foreperson or deputy foreperson — to the magistrate judge to return in open court the true bills on which the grand jury voted that day. (See Affirmation of William A. Burck ("Burck Aff."), dated Dec. 8, 2003, ¶¶ 3-6; Affirmation of Daniel M. Gitner ("Gitner Aff."), dated Dec. 8, 2003, ¶¶ 3-5; Affirmation of Nancy Kestenbaum ("Kestenbaum Aff."), dated October 16, 2003, ¶ 3.) The Government notes that the return of indictments is not generally recorded on tape, nor are the indictments themselves normally stamped or marked to indicate that they have been returned "in open court." (See Burck Aff. ¶¶ 3-4; Gitner Aff. ¶ 5.) The indictment in this case, however, is signed by the foreperson as well as the United States Attorney, and is also signed by the foreperson as "A True Bill." On the indictment itself is the apparently contemporaneously endorsed entry: "11/18/98: Indictment Filed. Fox, Kevin Nathaniel, U.S.M.J." The docket entry for November 18, 1998 also contains the following entry: "11/18/1998 . . . INDICTMENT as to Brij Mittal (1) count(s) 1, 2-4 (Preliminary Examination cancelled.) (jm) (Entered: 11/19/1998)." The Government maintains that based on the records and the practice of the Office at the time, the indictment in this case was returned in open court before the Magistrate Judge on duty by the grand jury as a body. (See Gitner Aff. ¶ 5; see also Kestenbaum Aff. ¶¶ 5-6.)
Under the current Rule 6(f), the "grand jury — or its foreperson or deputy foreperson — must return the indictment to a magistrate judge in open court." However, prior to 1999, Rule 6(f) required the entire grand jury to be present in Magistrate Court when an indictment was returned. (See Gitner Aff. ¶¶ 3-4.) The indictment in this case was filed on November 18, 1998, and the Government submitted an affirmation that the Office practice at the time was to have an Assistant United States Attorney accompany the entire grand jury to Magistrate Court to return the indictment. (See id.)
In addition, the Government obtained the tapes of recorded proceedings in Magistrate Court on November 18, 2003, the day that the indictment against Mittal was filed. (See Burck Aff. ¶¶ 5-6.) A review of the tapes, the Government represents, shows that during the morning calendar call, the case of United States v. Mittal was announced and put off until the afternoon calendar call because it was being presented to the grand jury that morning. (Id. ¶ 6.) During the afternoon calendar call, the Assistant United States Attorney reading the calendar stated that the grand jury had returned an indictment against Mittal and that the case was to be marked off the calendar. (Id.) The return of the indictment was not recorded on tape, which was consistent with the practice before magistrate judges. (Id. ¶¶ 3, 6.)
The Government has thus presented circumstantial evidence — both concerning the Government's usual practice and concerning the specific treatment of the indictment at issue — that tends to show that the indictment was in fact properly returned in open court. Meanwhile, the petitioner has presented no evidence nor has he suggested any basis to believe that he would be able to present any evidence that casts doubt on the Government's representations. Based on the evidence, as presented to the Court on this motion and as would be presented at a testimonial hearing, the petitioner has failed to make any showing that it is more likely than not that there was any defect in returning the grand jury indictment in this case. See Kalani v. United States, No. 02 Civ. 8663, 2002 WL 31453094, at *10 (S.D.N.Y. Oct. 31, 2002) (noting that petitioner in § 2255 motion bears burden of proving issues by preponderance of evidence, and rejecting similar argument where petitioner "failed to present any specific factual allegations tending to show that the Indictment was returned in violation of the Local Rules in this District and Rule 6(f)").
Moreover, even if there had been a defect, the failure to return the indictment in open court would not constitute a constitutional violation requiring the Court to vacate the conviction based on an allegedly defective indictment. See Bank of Nova Scotia v. United States, 487 U.S. 250, 254 (1988) (ruling, in case involving allegations of prosecutorial misconduct in violation of Fed.R.Crim.P. 6(d), (e), that "a district court may not dismiss an indictment for errors in grand jury proceedings unless such errors prejudiced the defendants."). In United States v. Lennick, 18 F.3d 814 (9th Cir. 1994), the Court of Appeals for the Ninth Circuit reviewed the relevant case law and relied on Bank of Nova Scotia to reject the argument that the failure to return an indictment in open court required dismissal of the indictment. Id. at 817-18 (denying direct appeal of conviction where government conceded that indictment was not returned in open court). As the Court of Appeals explained, any alleged defects in grand jury procedure are subject to a harmless error analysis, and there was nothing about the failure to return the indictment in open court that rendered the proceedings "fundamentally unfair" or prejudicial to the defendant. Id. So it is in this case. There is nothing, even in the petitioner's allegations, that rendered the proceedings fundamentally unfair or that prejudiced the petitioner.
The petitioner relies on Renigar v. United States, 172 F. 646 (4th Cir. 1909), in which the Court of Appeals for the Fourth Circuit did dismiss an indictment because it was not returned in open court. However, as the Court of Appeals for the Ninth Circuit persuasively pointed out in rejecting Renigar, "applying a harmless error analysis to [the appellant's] claims is more consistent with recent case law." Lennick, 18 F.3d at 817 n. 2; cf. Kalani, 2002 WL 31453094, at *9 (commenting, without deciding, that it was "doubtful" that failure to return indictment in open court constituted violation of Sixth Amendment's notice provision).
The petitioner also argues that even if the failure to return the indictment was not itself a constitutional violation, trial counsel was ineffective in not investigating whether the indictment was properly returned and in moving to dismiss if it was not. Reframing the argument in terms of ineffective assistance of counsel does not help the petitioner. First, defense counsel at the early stages of the prosecution was not Marcus but Faith Gay, who filed and argued a motion to dismiss on the grounds of incorrect venue and failure to state an offense.See generally, Mittal, 1999 WL 461293. There is no specific challenge to Gay's effective assistance, and she in fact argued vigorously and effectively for the defendant. In any event, there is no basis for arguing that under prevailing professional standards, defense counsel must investigate the form of grand jury proceedings where an indictment is facially valid and free of substantive defects. The reasonableness of defense counsel's conduct in this case is confirmed by the Supreme Court's rule allowing the district court to dismiss an indictment only where prejudice can be shown. See Bank of Nova Scotia, 487 U.S. 254-57.
Most importantly, as made clear during the argument on the § 2255 motion, no benefit could have inured to the defendant had a defect in returning the indictment been discovered. (See Mar. 19, 2004 Tr. at 6-9.) Any defect could have easily been cured. The petitioner is unable to explain how he was prejudiced at all by his counsel's alleged failure to investigate and argue with respect to the return of the indictment in open court. There is no basis for vacating the conviction or holding an evidentiary hearing on this claim.
IV.
Second, the petitioner argues that Marcus provided ineffective assistance of counsel by allegedly failing to conduct a sufficient pretrial investigation, allegedly because of his medical condition. In particular, the petitioner argues, defense counsel failed to review tapes of interviews with potential witnesses because, in one instance for example, he was unable to stay awake at night to listen to them. The petitioner argues that his counsel was ineffective in failing to investigate, call, and prepare multiple witnesses and potential witnesses. The petitioner also argues that counsel, without adequately investigating the case, advised him not to testify on his own behalf.
The theory that Marcus was ineffective for failing to call and prepare witnesses is similar to the one raised and rejected in the Rule 33 motion. See Mittal, 2000 WL 1610799, at *6. As described in detail in this Court's Opinion and Order on that motion, trial counsel did not himself interview witnesses and instead relied on an investigator who interviewed numerous witnesses and taped the interviews. See id. Marcus called a small number of these witnesses without preparing them to testify at trial. While the petitioner argues that the failure to prepare witnesses personally was a sign of incompetence, it appears to have been a trial strategy. (See, e.g., Tr. at 1629.) In his summation, Marcus attempted to contrast his witnesses, who were described as spontaneous and truthful, with the Government's witnesses, who were allegedly coached into saying what the Government wanted. (See Tr. at 1783.)
In deciding the Rule 33 motion, this Court found that the decision not to prepare his witnesses personally was not an unreasonable trial strategy and that delegating witness interviews to an investigator was not a failure to investigate critical issues. Mittal, 2000 WL 1610799, at *6. "Most importantly," this Court concluded, "the defendant has not shown that he was prejudiced at all by trial counsel's preparation of witness examinations or his efforts to find additional witnesses who should have been called or any additional testimony that should have been elicited." Id. Thus, the petitioner failed to satisfy either prong of the Strickland inquiry. This Court's rejection of the petitioner's arguments of ineffective assistance of counsel was reviewed and affirmed on appeal "substantially for the reasons stated in the District Court's" opinion. Mittal, 2002 WL 1275105, at *3.
In this § 2255 motion, the theory has been adapted slightly from the Rule 33 motion in attempting to emphasize Marcus's alleged failures outside the courtroom during pretrial investigation, as opposed to Marcus's alleged failures during the trial. The theory is also supplemented by exhibits relating to Marcus's sleep disorder. The petitioner argues that the failure to conduct a fuller investigation could not be attributed to reasonable professional judgment and was instead caused by his severe obstructive sleep apnea, which drained his energy. The petitioner focuses on three sets of witnesses who could have been called but for his counsel's medical condition. However, ultimately for the same reasons discussed at length in the decision on the Rule 33 motion, the petitioner cannot show that the failure to call any witness prejudiced him.
The first set of witnesses includes Edward S. Kornreich and Donna Barshotsky and involves Mittal's assertions that he never received the February 5, 1993 letter from Kornreich describing the Medicare anti-kickback provisions. At trial, Kang testified that he received the Kornreich letter through the Bay Ridge Cardiac Diagnostic Center and that the letter, which accurately reflected the meeting with Kornreich, was addressed to himself and Mittal. (See Tr. at 735-36.) Mittal has submitted the affidavit of Kornreich, which states that the standard practice was to mail only one original of a letter as it is addressed. (See First Pet'r Mem. Ex. C (Kornreich Aff. ¶ 3.).) Mittal thus claims that Kang received the only copy of the letter and that Barshotsky, administrator of Bay Ridge Cardiac Diagnostic Center, would have been able to testify that she never distributed the Kornreich letter to Mittal. (See Mittal Decl. ¶ 3.) Kornreich and Barshotsky, the petitioner contends, could thus have supported the theory that the petitioner did not know that what he was doing was illegal.
Mittal, however, was clearly at the meeting with the attorney, and Kang testified that the letter reflected the contents of the meeting and that he also spoke to Mittal about the contents of the letter shortly after receiving it. (See Tr. at 736-37.) At most, Kornreich and Barshotsky could have testified that they did not send or give the letter to Mittal, but they could not have discredited the testimony of Kang nor could they have testified that Mittal was unaware of the letter or unaware of the anti-kickback laws. It is clear that the failure to call these two witnesses was not prejudicial to any defense involving the petitioner's mens rea. See Mittal, 2002 WL 1275105, at *2 (discussing on direct appeal Kang's testimony and evidence that defendant knew his conduct was illegal). Indeed, calling Kornreich as a witness would have been counterproductive because there is no dispute that Mittal met with him and there is no basis in the record to believe that he would have contradicted the contents of his letter.
The second set of witnesses would have been character witnesses, including J. Donald Di Cunto, Krishan Bhatia, and Simon Saada. The Government correctly points out that calling these witnesses would have opened the door to the Government's ability to attack Mittal's credibility. The Government would have, for example, been able to elicit testimony from Kang about how Mittal's medical license was temporarily suspended because of an alleged false statement Mittal had made. Defense counsel, however, was careful to prevent any such testimony from Kang (see Tr. at 685-87), and the decision to keep credibility from becoming an issue cannot be called objectively unreasonable and below accepted professional standards. See United States v. Best, 219 F.3d 192, 202 (2d Cir. 2000) ("[T]he decision whether to expose a defendant to such an attack [on his character] is surely a tactical decision that cannot be second-guessed.")
Finally, the petitioner argues that Marcus was ineffective in failing to interview and possibly call two witnesses who would have supported a defense under the safe harbor provisions of the anti-kickback statute that exempt payments made in the context of a bona fide employment relationship. Those two potential witnesses are Marie Vadala, allegedly an employee of Mittal, and Mittal himself. For the reasons explained below, it could not be considered ineffective assistance of counsel not to have called witnesses to support an alleged employer-employee safe harbor defense because there was no reasonable basis for such a defense.
There are additional reasons why the contentions with respect to the testimony of Mittal himself are without merit. The petitioner is not contending that counsel wholly failed to advise his client of the right to testify. The claim is simply that Marcus "encouraged [the petitioner] not to testify" (Mittal Decl. ¶ 3) without conducting a thorough enough pretrial investigation. There is no basis for concluding that the petitioner was unaware of his right to testify, that he was coerced into not testifying, or that he did not have sufficient access to counsel in order to consult with respect to his own defense. Mittal was a sophisticated defendant who was represented by Marcus in a previous case and who dismissed his previous counsel, Faith Gay, specifically in order to have Marcus represent him in this case. There is no reason why the petitioner would not have been able to inform his counsel of his connection to Vadala and his belief that he was operating within the law, if that was indeed the case. The conclusory and self-serving allegations in the petitioner's affidavit do not show objectively unreasonable behavior where trial counsel simply "encouraged [the petitioner] not to testify and said that testifying may be detrimental to [the petitioner's] case and might have adverse effect[s]." (Mittal Decl. ¶ 3.)
The Government correctly points out the contradictory and self-serving nature of many of the allegations in Mittal's declaration submitted for the first amended motion. For example, Mittal argues that trial counsel was ineffective for failing to call witnesses to show that he never received the letter and was unaware that his conduct violated the anti-kickback statutes. But in his declaration, he implies that he was aware of the letter and its contents for purposes of meeting the safe harbor provisions. That is, he contends that trial counsel failed to argue that the Kornreich letter "was, in fact and law, exculpatory for me because it demonstrated a reasonable basis for a good faith belief by me that I was entitled to the safe harbor defenses." (See Mittal Decl. ¶ 5.) Mittal could not have relied on a letter that he now alleges he did not see.
Indeed, not only was advising Mittal not to testify consistent with prevailing professional standards, it appears to have been sound advice. Mittal's testimony would not have rebutted any substantive issues and would have only opened the door for attacks on his credibility. For example, while Mittal asserts that he never received the Kornreich letter sent to Kang, he has not denied attending the meeting with Kang and Kornreich to discuss the Medicare anti-kickback provisions. Upon cross-examination, Mittal would have had to admit these facts or wager his credibility against Kang's. Also, the petitioner's credibility would have been attacked because his prior false statement and suspension of his medical license, as explained above, would have become admissible. Most importantly, Mittal would have been cross-examined about regularly receiving payments from Patel in cash for over seven years and would have been confronted with records showing the kickbacks. Mittal would have been hard pressed to explain to the jury how he received thousands of dollars in cash in hand-delivered envelopes while believing that he was acting within the law.
The bottom line is that the petitioner cannot show any possible prejudice with respect to the failure to investigate fully the possibility of calling the identified witnesses, including Mittal himself. The additional information submitted for this motion with respect Marcus's sleep apnea does not bolster the petitioner's theory. Even if trial counsel had a sleep disorder, the argument on this motion is not that he fell asleep during trial. That argument was already carefully considered and rejected by this Court in an opinion that was affirmed by the Court of Appeals. The argument on this motion is only that Marcus did not conduct a sufficiently thorough pretrial investigation. But, as made clear on the Rule 33 motion, trial counsel hired an investigator to conduct witness interviews and announced a strategy of not personally preparing witnesses in order to contrast his witnesses with those offered by the Government. Both actions were reasonable trial strategy.
The petitioner's "Traverse" cites several instances from the trial record that allegedly reflect Marcus's lack of preparation and, in one instance, raise a question of whether Marcus was falling asleep during trial. This Opinion and Order addresses Marcus's investigation before trial and specifically his failure to interview and/or call certain persons identified in the § 2255 motion.
To the extent that the petitioner is relying on the counsel's trial conduct to show ineffective assistance of counsel, the decision and analysis in the Rule 33 motion stands. Even if there is more documentation for Marcus's sleep disorder, defense counsel's performance at trial was not so deficient as to be ineffective assistance of counsel. Moreover, the petitioner cannot show a reasonable probability that but for any omission, the verdict would have been different.
Moreover, the petitioner has failed to identify any witness (a) who should have been called under prevailing professional standards and (b) whose testimony would have had a reasonable probability of benefiting the defendant. Based on the trial record and the supplemental submissions, the petitioner cannot establish a claim of ineffective assistance of counsel on the proffered bases.
V.
The petitioner's third argument is that trial counsel was ineffective in failing to investigate and pursue the defense that Mittal's conduct fell within a safe harbor provision of the anti-kickback statute. While 42 U.S.C. § 1320a-7b(b) (1) and (2) prohibit soliciting, receiving, or offering remuneration in connection with the Medicare program, § 1320a-7b(b) (3) (B) exempts "any amount paid by an employer to an employee (who has a bona fide employment relationship with such employer) for employment in the provision of covered items or services." The safe harbor regulations similarly provide:
"[R]emuneration" does not include any amount paid by an employer to an employee, who has a bona fide employment relationship with the employer, for employment in the furnishing of any item or service for which payment may be made in whole or in part under Medicare, Medicaid, or other Federal health care programs.42 C.F.R. § 1001.952(i).
The petitioner argues that Marcus failed to interview and call as witnesses Marie Vadala and the petitioner himself, who purportedly would have testified about an "agreement between Ms. Marie Vadala and me [Dr. Mittal] concerning the services provided by Ms. Vadala and that I had no intent to violate the law. Ms. Vadala was being paid approximately $250 per week for the services in cash and the same amount of money was given by Patel. There was no remuneration or kickback. The salary of Ms. Vadala was given to me, which in turn was handed over to Ms. Vadala." (Mittal Decl. ¶ 3.)
Attached to the petitioner's memorandum of law is a purported agreement between Mittal and Vadala for part time work. (See First Pet'r Mem. Ex. D.) In relevant part, the agreement, dated August 10, 1990, provided that Vadala's duties would include "calling for the services for the patients, ordering and arranging medical durable equipment delivery to the patients by contacting the staff of Mr. Niranjan Patel's office." (Id.) The agreement also provided that Vadala would be "responsible for collecting reports from Mr. Patel's office and show [sic] them to Doctor Brij Mittal for further care or referral to other specialists. The salary will be funded by Mr. Niranjan Patel, varying from $250 to $300 per week." (Id.)
Even assuming that this unusual agreement is authentic and that Vadala did perform the services Mittal describes, the agreement would not have enabled Mittal to qualify for the safe harbor. On its face, the statute covers payments made between employer and employee for the provision of covered items or services in the context of a bona fide employment relationship. In this case, the payments by Patel to Mittal were not payments by an employer to an employee. Further, there is no suggestion that Vadala was Patel's employee or, even if that were conceivable, that all of the payments to Mittal were in fact simply payments by Patel to his "employee" — Vadala. Moreover, there would not be an employment relationship for the provision of goods and services covered by Medicare because Vadala's sole purpose was to refer patients to Patel. See United States v. Starks, 157 F.3d 833, 839-40 (11th Cir. 1998) (ruling that safe harbor provisions of anti-kickback statute were not unconstitutionally vague as applied to defendants who "were not providing `covered items or services'" because they received payment "only for referrals and not for any legitimate service for which the Hospital received any Medicare reimbursement"). Far from exculpating the petitioner, the agreement with Vadala — if authentic — would have been proof that Mittal arranged to refer patients to Patel and did it with the assistance of Vadala, who was paid in cash.
Mittal was convicted of all three substantive counts, which involved payments of $4970 on September 5, 1997 (Count Two), $9300 on January 14, 1998 (Count Three), and $4140 on February 13, 1998 (Count Four). For the four-month period of September 1997 to January 1998, Mittal thus received over $2000 for each month, and for the one-month period of January to February 1998, Mittal received $4140. These amounts were well in excess of the $250-$300 per week at issue in Mittal's new theory of payments for Vadala.
Furthermore, any suggestion that the cash payments to Mittal had anything to do with payments to Vadala would have been inconsistent with records that showed that the amounts Mittal sought from Patel were measured not by payments to Vadala but rather by payments for the individual products and services for which he was referring patients to Ganesh and American Open. (See GX 1, 6, 9, 14, 15; Tr. at 590-96, 620-21, 631-33, 1729-30, 1734-36, 1745-48.) For example, Patel testified that he determined how much to give Mittal for each payment based on records kept in a green folder, which was introduced as Government Exhibit 1. (See Tr. 590-96, 620-21, 631-33.) Patel also testified about preparing lists for Mittal that were placed in the payment envelopes and that reflected the names of referred patients and the amount of money being delivered to Mittal based on those patients. (See Tr. 839, 851-55, 883-84, 905; GX 6, 9, 14, 15.)
An affirmative defense based on a formal relationship between Patel, Mittal, and Vadala would also have conflicted with the defense theory at trial that Mittal was not in fact directing patients to Ganesh and American Open but was simply providing options for the patients in their own best interests. Anita Kearney, for example, worked briefly for the defendant and testified that Mittal used different MRI services depending on what was convenient for the patient. (See Tr. at 1609-15.) Both Kearney (Tr. at 1610) and another former employee, Sarah Caratozzolo (Tr. at 1634-35), testified that they had not heard of Patel. If the defense then asserted that a part-time employee was working, for cash, solely as a means for referring patients to Patel, it would have seemed only more clandestine. Such a defense would also have prevented trial counsel from pursuing the wholly reasonable strategy that he did, which was to put the credibility of prosecution witnesses at issue while arguing that Mittal made appropriate referrals to many places and denying that Ganesh and American Open — Patel's businesses — received referrals from Mittal's office. (See, e.g., Tr. at 1759, 1778-80, 1784); see also Best, 219 F.3d at 201 (stating that failure to pursue one possible trial strategy does not constitute ineffective assistance of counsel).
Moreover, it is inconceivable that testimony by Mittal and Vadala would have rebutted the Government's overwhelming evidence of the kickback scheme and Mittal's intentional participation in it. See, e.g., Mittal, 2000 WL 1610799, at *1-*2, *7. The evidence came in the form of extensive testimony by Patel (see, e.g., Tr. 531-80) and his nephew who occasionally delivered payments (see Tr. 1484-88). FBI Agent Jennifer Keenan testified about controlled deliveries from Patel to Mittal after Patel began cooperating with the FBI. The jury received evidence in the form of audio and video monitoring indicating Mittal's intent to receive cash for referrals. The tapes included highly incriminating statements by Mittal himself. See Mittal, 2002 WL 1610799, at *2. In the context of such evidence, the testimony of Vadala and Mittal would only have damaged the defendant's credibility and supported the Government's case.
In sum, the petitioner's claims of ineffective assistance of counsel for failure to pursue the safe harbor defense based on a bona fide employment relationship are meritless on the face of the statute and in the context of the trial record. There is no basis for arguing that Marcus was ineffective for failing to discover Vadala as a witness when Vadala's existence was known to the defendant the entire time. More importantly, any failure to call Vadala and pursue the safe harbor defense could not have prejudiced the petitioner.
The first amended § 2255 motion raised an additional issue that the Government interfered with effective assistance of counsel by interviewing Vadala but not disclosing her statements to defense counsel. The Government represents that no notes of any statement by Vadala have been discovered, and there is no basis to believe otherwise. Moreover, if the facts are as the petitioner claims, he would have been aware of anything Vadala could have contributed to the case, and he could have raised any issues regarding Vadala during pretrial and trial proceedings. At any rate, assertions about the Government's interference with the discovery of Vadala also fail because the safe harbor defense is meritless and because Vadala's testimony would not have been helpful to Mittal.
VI.
The petitioner's final basis for arguing ineffective assistance of counsel, raised in his second amended petition, is that both Marcus and Rafikian, acting together as counsel, failed to encourage him to plead guilty because of an alleged conflict of interest. Mittal claims that, even though Rafikian never appeared for him at trial, Mittal considered Marcus and Rafikian to be his lawyers equally, and that both were retained to represent his interests. Mittal argues that he was not informed of the strength of the evidence against him, and was never advised to plead guilty, because Marcus and Associates had an incentive to ensure that Mittal was imprisoned so that the firm could hide evidence of Rafikian's alleged investment fraud at First Investors Capital.
In his first amended petition, Mittal withdrew the previous allegation of ineffective assistance of counsel based on an alleged failure to urge Mittal to plead guilty. According to the petitioner, he had already served his sentence and the only relief warranted would have been a reduction in his sentence. The petitioner now raises an ineffective assistance claim in his second amended petition based on his counsel's failure to engage in plea discussions because of an alleged conflict of interest between the petitioner and his counsel. The Government argues that, if the petitioner succeeds on this claim, the remedy afforded would not be to vacate his conviction but merely the entry of an informed guilty plea or a resentencing. See United States v. Gordon, 156 F.3d 376, 381 (2d Cir. 1998) (per curiam) ("[W]here there has been a finding of ineffective assistance of counsel in a § 2255 proceeding, the remedy should be tailored to the injury suffered from the constitutional violation.") (citation and internal quotation marks omitted). The petitioner responds that he may be able to show that adequately advised by counsel, he could have negotiated an advantageous plea agreement. It is not necessary to reach the possible relief, if any, that would be appropriate if the petitioner could establish his claim.
In order to establish an actual conflict of interest has adversely affected the performance of defense counsel, the petitioner must show that counsel's interests diverged from the petitioner's on some material legal or factual issue and resulted in an "actual lapse in representation." See Triana v. United States, 205 F.3d 36, 41 (2d Cir. 2000) (quoting Cuyler v. Sullivan, 446 U.S. 335, 348-49 (1980)); see also United States v. O'Neil, 118 F.3d 65, 71 (2d Cir. 1997). This is a three-part showing. First, the petitioner must show an actual conflict of interest, that is, that the "attorney's and defendant's interests diverge with respect to a material factual or legal issue or to a course of action." United States v. Moree, 220 F.3d 65, 69 (2d Cir. 2000) (internal citations and quotation marks omitted). Second, the petitioner must demonstrate an "actual lapse in representation" that resulted from the conflict. An actual lapse in representation is demonstrated by the existence of some "plausible alternative defense strategy not taken up by counsel." Id. In this regard Mittal does not need to show that the alternative defense "would necessarily have been successful." Id. (internal quotation marks and citations omitted). It would be sufficient to show that the alternative strategy "possessed sufficient substance to be a viable alternative." Id. (internal quotation marks and citations omitted). Third, Mittal must show that the alternative defense was "inherently in conflict with or not undertaken due to the attorney's other loyalties or interests." Id. (internal quotations marks and citations omitted) (emphasis in original). In other words, Mittal must show that "trial counsel chose not to undertake [the alternative strategy] because of his conflict." Winkler v. Keane, 7 F.3d 304, 309 (2d Cir. 1993);see also United States v. Locascio, 395 F.3d 51, 57 (2005) (evidentiary hearing warranted regarding actual conflict of interest claim).
An evidentiary hearing is required in this highly unusual case, solely on the issues raised by the alleged conflict of interest. It is unclear if Rafikian could be considered as counsel for Mittal in view of his failure to appear at all in the criminal proceeding. See Triana, 205 F.3d at 43 (no per se violation of right to counsel where the lawyer implicated in the crime is not the lawyer conducting the defense and has done nothing that has a bearing on the result). Moreover, it is unclear whether Marcus was involved in Rafikian's alleged fraud against Mittal. Finally, it is unclear whether there was a plausible alternative strategy that was not pursued because of the alleged conflict. Mittal argues that he would have pleaded guilty had his counsel advised him of the strength of the case against him and negotiated a plea agreement similar to the pleas afforded to the other doctors involved in Medicare kickback schemes. While these protestations appear to be inconsistent with Mittal's various claims of innocence and the availability of alleged defenses, these issues cannot be resolved without a hearing. See Griffin v. United States, 330 F.3d 733, 738 (6th Cir. 2003) ("Griffin's repeated declarations of innocence do not prove, as the government claims, that he would not have accepted a guilty plea."); Cullen v. United States, 194 F.3d 401, 407-08 (2d Cir. 1999) ("In assessing Cullen's credibility, the fact-finder would be entitled, but not required to consider Cullen's continued protestations of innocence as weighing against the credibility of his claim . . .") Moreover, the reasons why Mittal did not plead guilty and the factual issue of whether Marcus advised his client to enter a guilty plea cannot be determined without a hearing. Accordingly, the Court will hold an evidentiary hearing with respect to the petitioner's ineffective assistance claim based on the alleged conflict of interest.
CONCLUSION
For the reasons explained above, on the basis of the trial record and supplemental submissions, as well as the Court's familiarity with the prior proceedings, there is no possible basis for the petitioner to succeed on the original § 2255 motion or first amended petition and those motions are denied. The Court will, for the reasons explained, conduct an evidentiary hearing with respect to the petitioner's ineffective assistance of counsel claim based on the conflict of interest raised in the second amended petition.
SO ORDERED.