USCA1 Opinion

UNITED STATES COURT OF APPEALS

FOR THE FIRST CIRCUIT
_________________________
No. 93-1832
UNITED STATES OF AMERICA,
Appellee,
v.
KEVIN F. O'BRIEN,
Defendant, Appellant.
_________________________
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Richard L. Williams,* Senior U.S. District Judge]
__________________________
_________________________
Before
Selya, Cyr and Boudin, Circuit Judges.
______________
_________________________

Alan Chapman, with whom Chapman & Chapman was on brief, for
____________
__________________
appellant.
Timothy Q. Feeley, Assistant United States Attorney, with
__________________
whom A. John Pappalardo, United States Attorney, was on brief,
___________________

for the United States.

_________________________
February 7, 1994
_________________________
_________________________
*Of the Eastern District of Virginia, sitting by designation.

SELYA,
SELYA,
appellant Kevin
making, or

Circuit Judge.
Circuit Judge.
______________
F.

causing

O'Brien
to

on

jury

convicted defendant-

two hundred

be made,

false

ninety

statements

counts

of

related

to

applications for Medicare benefits, and one hundred thirty counts

of converting

federal funds to

his own behoof.1

After combing

the record, we uphold the verdict.

I. BACKGROUND
I. BACKGROUND
We
the

examine the relevant events as a whole, marshalling

evidence in

theory of the

the light most

case.

congenial to

the prosecution's

See United States v. Ortiz, 966

___ ______________
_____

F.2d 707,

711 (1st Cir. 1992), cert. denied, 113 S. Ct. 1005 (1993); United
_____ ______
______
States v. Maraj, 947 F.2d 520, 522 (1st Cir. 1991).
______
_____
Appellant
O'Brien

Ambulance,

Ambulance,
served

Ltd.2

as its chief

was the
Inc.

president

and

its

As president

of

and sole

lineal

shareholder of

descendant,

the corporation,

executive and principal

O'Brien

appellant

operating officer.

____________________

1The statutes of conviction can be succinctly summarized.

One such statute, now repealed and replaced, at the time provided
in pertinent part that any Medicare vendor who "knowingly and
willfully makes or causes to be made any false statement or
representation of a material fact in any application for any
benefit or payment [under the Medicare program]" thereby commits
a felony.
42 U.S.C.
1395nn (1987) (repealed).
A second
statute, still in force, provides in pertinent part that whoever
"knowingly converts to his own use or the use of another . . .
any voucher, money, or thing of value of the United States or of
any department or agency thereof" is guilty of a felony.
18
U.S.C.
641 (1988). The indictment with which we are concerned
invokes these statutes and also charges appellant as an aider and
abettor, see 18 U.S.C.
2 (1988).
___

2Notwithstanding the shifting

nomenclature, the entity
remained the same.
Consequently, we refer to the firm,
regardless of which appellation claimed preeminence at any given
time, as "the corporation."
2

He,

and he

alone, possessed

authority to

sign company

checks

during

the period covered by the

March

to August

of 1987.

instant indictment, i.e., from

____

During

that period,

appellant also

acted as the corporation's sole director.

The corporation ran
regularly

billed Medicare

Medicare

a licensed ambulance service.

for

recipients, with the

program

accounted

for

Many

of the

revenues.

reimbursement for

ambulance services
result that the

significant
corporation's

the transportation

the

associated

represented various

trips

corporate

payment requests
of Medicare

with

such

Medicare recipients

were ambulatory;

for

of

sought

recipients to

During

the period

indictment, the corporation, in order to maximize

remuneration

fact, they

to

federal Medicare

portion

and from approved kidney dialysis treatments.

covered by the

provided

It

dialysis

and it

treatments

services,
as

bedridden when,

also regularly

to

have

regularly

been

in

represented

undertaken

by

ambulance when, in fact, the patients had been transported by van

or

wheelchair

camouflage
the

car.3

these untruths.

scheme,

revealing

corporation's billing
reality

of

Corporate

events,

Subsequent
that,

practices
and

records

were

falsified

investigation uncovered

in

numerous

bore

little

relation

corporation

had

that the

to

instances,
to

the

the

bilked the

____________________

3Carriage by ambulance
costs substantially more
than
carriage by van or wheelchair car.
Thus, the Medicare rules
restricted
reimbursable ambulance
transportation to
cases
involving approved treatments for non-ambulatory patients, and,
even then, only if no alternate means of transportation could be
employed without endangering the patient's condition.
3

government out of well over $300,000.

Based on this, and other, evidence
that,

in late

teetering
returned

1986 and

on the

corporation

patients

in vans

nonetheless
Medicare

brink of

1987, the

insolvency

an indictment against

at trial showed
the

early

or wheelchair

stipends, saying

been

federal grand

jury

Evidence presented

six-month period in

transported

misrepresented

corporation had

appellant.4

that, during the

routinely

including evidence

cars

these

ambulatory

(often as

services

that they

question,

in

related to

dialysis

a group),

but

applying

for

individualized

transportation of non-ambulatory patients via ambulance.

Anticipating appellant's eventual line
government presented
(in

the

form, inter
_____

both live testimony

alia,
____

of

documents related to Medicare

the

pervasiveness of

showed, through
whom

were

management
day

the

and corporate

slips, run

records

logbooks,

and

benefit applications) illustrating

criminal

the testimony

appellant's kith

run

of defense, the

conduct.

of corporate
and

kin), that

role, exercised substantial

operations of the corporation; that,

The

government

employees (some
appellant,

of

in his

control over the day-to-

on occasion, he filled

in

for the dispatcher and assumed other "line" responsibilities;

and that, in late 1986, the corporation altered its recordkeeping

practices in

two significant respects,

was to make

detection of the

the net effect

forthcoming fraud more

of which

difficult.

____________________
4The indictment was later superseded.
the indictment contained some 435 counts.

The final version of

Finally,

the

prosecution

identified appellant's
logbook entries, some

presented

an

expert

handwriting in connection
of which involved the

witness

who

with ambulance

Medicare recipients

at issue.
As the prosecution had anticipated, appellant
little

contradiction

fraudulent
it

to

charges

that

the

offered

corporation

made

representations in seeking Medicare payments and that

unlawfully

pitched his
he, himself,

converted

federal

funds.

defense on a relatively narrow

knew of,

or could

be held

Instead,

appellant

ground, denying that

criminally accountable

for, the corporation's peccadilloes.

At

the

close

of the

evidence,

appellant

moved for

judgment of acquittal,
ground.

The

convicted
fifteen

district

court

appellant on

principally on this

rejected the

four hundred

motion.

twenty

The

counts (the

jury

other

counts in the superseding indictment having been dropped

before trial).
II.
II.

Fed. R. Crim. P. 29,

This proceeding followed.

THE MERITS
THE MERITS
This is a rifle-shot appeal.

single

assignment

evidence.
target,

In

of

error,

reality,

claiming

he aims

for he effectively

Appellant advances only a

insufficiency

his fire

at

concedes that the

of

an even

the

smaller

government proved

the commission of the crimes.

Refined to bare essence, then, his

appeal

the simple

stands

government

or

falls

failed to

on

prove his

proposition

complicity in

that

the

the scheme.

We

consider his plaint.

5

A.
A.

Standard of Review.
Standard of Review.
__________________

The well-settled standard applicable to sufficiency-ofthe-evidence

whether,

challenges

after

assaying

requires
all

that

this

the evidence

in

court

determine

the

light most

amiable to the
in

its

government, and taking all

favor,

reasonable

rational

doubt, that

essential

defer all credibility

could

find,

the prosecution successfully

elements of the

Maraj, 947 F.2d at 522.

_____

factfinder

reasonable inferences

In

crime.

See
___

Ortiz, 966
_____

beyond

proved the

F.2d at 711;

this process, a reviewing court must

judgments to the jury.

See United States

___ _____________

v. David, 940 F.2d 722, 730 (1st Cir. 1991), cert. denied, 112 S.
_____
_____ ______
Ct. 2301

(1992); United States

_____________

(1st Cir.

1993); United States

_____________

v. Echeverri, 982 F.2d

_________
v. Serrano,
_______

675, 677

870 F.2d 1,

5 (1st

Cir. 1989).
Contrary to appellant's
does

not

general

place a
matter,

special
the

insinuation, the criminal

premium on

prosecution's

direct evidence.
burden

of

proof

As a
can

satisfied by either direct or circumstantial evidence, or by

combination

thereof.

See Echeverri,
___ _________

982 F.2d

at 677;

States v. Victoria-Peguero, 920 F.2d 77, 86-87 (1st

______
________________

law

be

any

United
______

Cir.), cert.
_____

denied, 111 S. Ct. 2053 (1991).

______

As long as the evidence taken in

its entirety supports a judgment

of conviction, it need not rule

out

every

other

reasonable

hypothesis

Victoria-Peguero, 920 F.2d at 86-87.

________________
B.
B.

Discussion.
Discussion.

of

innocence.

See
___

__________
Appellant submits

that the

prosecution introduced

no

direct

evidence

abetted
fraud.

that

he, himself,

committed

another's fraud, or induced some

We agree:

the government

fraud,

aided or

third person to commit

produced nothing in the way of

a confession or any other single piece of evidence that, standing

alone, might irrefutably prove appellant's guilty knowledge.
a court

will not

because the jury

verdict,

automatically invalidate

a conviction

based its finding of scienter,

on circumstantial

evidence alone.

merely

and, hence, its

Guilty knowledge,

like specific intent, see, e.g., United States v. Desmarais,

___ ____ _____________
_________
F.2d 347, 352

(1st Cir. 1991); United States v.

_____________

1006, 1010 (1st

evidence.

Cir. 1982), seldom can be

938

Campa, 679 F.2d

_____

established by direct

This principle has particular pertinence in respect to

fraud crimes which,

by their very nature, often

the way of direct proof.

confesses,

But

or

suspect

yield little in

Unless an accomplice turns, a miscreant

is

snared by

prosecutions for fraud must routinely

his

own

rodomontade,

be mounted on the basis of

indirect evidence.
This approach to
legally

problematic nor

since settled

proving guilty

even controversial.

that the prosecution

direct evidence of a defendant's

array of circumstantial
power.
F.2d

See
___

knowledge is

may prove

The

neither

law is

its case

long

without

guilty knowledge so long as the

evidence possesses sufficient persuasive

Maraj, 947 F.2d at 523; United States v. Boylan, 898

_____
_____________
______

230, 242

(1st Cir.),

cert. denied,
_____ ______

498 U.S.

849 (1990);

United States v. Mount, 896 F.2d 612, 615 (1st Cir. 1990); United
_____________
_____
______
States v. Thornley, 707 F.2d 622, 625 (1st Cir. 1983).
______
________

Moreover,

"[c]ircumstantial evidence
not compel

a finding

tending to show guilty knowledge need

of such

knowledge in

order to

sustain a

conviction; all that is necessary is that reasonable jurors could

be

convinced beyond a

guilty knowledge."

reasonable doubt that

United States
_____________

the defendants had

v. Flaherty, 668 F.2d 566, 579

________

(1st Cir. 1981); accord United States v. Kilcullen, 546 F.2d 435,
______ _____________
_________

443

(1st Cir. 1976)

906 (1977).
there

is

(collecting cases), cert.

_____

In this case, then, the pivotal issue is not whether

direct

evidence

of

appellant's

Rather, the proper query hinges

reasonably could infer
his participation
evidence,

knowledge.

on whether a rational factfinder

in the charged

hence,

crimes, from the whole

the presumption of

of the

innocence and the

burden to prove essential facts beyond a reasonable

We believe this query merits an affirmative answer.

Here,

reins of
operation
that

guilty

appellant's guilty knowledge and,

bearing in mind

government's
doubt.

denied, 430 U.S.

______

the government

corporate control and

of the

business.

appellant, himself,

headquarters,
meetings,

proved

ran the

reviewed run

appellant held

had hands-on involvement

There

spent

was testimony,

long

company,
logs

the

and

hours

in the

for example,
the

corporate

conducted management

and staff

weekly

at

the

schedules

of

driver

assignments and equipment utilization, sometimes assumed the role

of dispatcher, and
cash flow.

Many of

enjoyed sole dominion over

the corporation's

the transportation services described in the

fraudulent billings required

special hours for drivers,

jury

affected payroll

reasonably could infer

which a

and appellant's

domain unquestionably included payroll.

There was
on Medicare

those records
had

He was

it

the

of

abrupt

in

up the scheme.

was in dire financial straits, a

owner's involvement in

were kept, and

evidence,

entries, and

recordkeeping

practices,

Finally, the

corporation

fact which made more likely the

the illegal enterprise through

remained afloat.

The

chronicling

some fraudulent logbook

changes

with the

his ultimate control.

handwriting

authorship of

conducive to covering

corporation

intimately familiar

were maintained under

evidence

invariably appeared

in which the corporate records

before

appellant's
the

Appellant's name

claim forms.

method and manner

jury

more.

See
___

which the

United States v. McMahon, 938

_____________
_______

F.2d 1501, 1507 (1st Cir. 1991).

Appellant invites us

to consider each of

of evidence in isolation; and he

each piece can

claims that, taken one by

be explained away in

decline the invitation.

these pieces

one,

some innocent fashion.

The evidence in a

We

criminal case should

be viewed in its totality, see, e.g., United States v. Bourjaily,

___ ____ _____________
_________
483

U.S.

171,

179-80

circumstantial evidence
all, "[t]he

sum

of

(1987),

for

the use to

an evidentiary

a country lane
which the

particularly

often has an exponential effect.

greater than its constituent parts."

beehive near

evidence

presentation

well

be

Ortiz, 966 F.2d at 711.

_____

tells a stranger very

property is

devoted.

Yet,

may

After

little about
if there

are

eighty or ninety beehives in a shed, who would doubt that

he had

stumbled upon an apiary?

9

Appellant

also says

the inference hawked

tended

that some

witnesses contradicted

by the government, offering

to show appellant

distanced himself from

operation of the ambulance service, confined his

and payroll,

delegated

much responsibility,

workplace only sporadically.

asks

us to usurp

523; David, 940

_____

conflicting factual
and

v.
jury

Rothrock, 806
________
can

freely

See
___

and

attended

See Maraj,
___ _____

statements, the resolution of

F.2d 318, 321

choose to

the

for it

947 F.2d at

the conflict,

calls, are uniquely

Ortiz, 966 F.2d at 713;

_____

discounting other testimony

direction.

labors to sales

"[W]hen the jury is presented with

any concomitant credibility

jury's province."

the day-to-day

This argument lacks force,

the jury's province.

F.2d at 730.

testimony that

accord United States

______ _____________

(1st Cir. 1986).

credit

particular

Therefore, a

testimony while

that arguably points in

United States v. Alvarez,

_____________
_______

within the

a different

987 F.2d 77,

83 (1st

Cir.), cert. denied, 114 S. Ct. 147 (1993).

_____ ______

We note, too, that the element of guilty knowledge in a

criminal case
suggesting

may be supplied by inferences

that a defendant deliberately blinded himself to what

would otherwise have

been obvious.

Richardson, ___ F.3d ___, ___

__________
op. at 10-11];
F.2d
States
______

579,
v.

drawn from evidence

See, e.g.,
___ ____

United States v.
_____________

(1st Cir. 1994) [No. 92-2307, slip

United States v. St. Michael's Credit Union, 880

_____________
___________________________

584-85

(1st Cir.

Littlefield,
___________

1989)

840 F.2d

(collecting
143,

denied, 488
______

U.S. 860

F.2d 39, 46

(1st Cir.), cert. denied,

_____ ______

147

(1988); United States

_____________

cases); United
______

(1st Cir.),

cert.
_____

v. Picciandra,
__________

788

479 U.S. 847 (1986).

In

10

this case, the stage was appropriately set for such an inference:
although appellant claimed a lack of knowledge, the
in the

light most hospitable

to the government, see

___

facts, taken

Ortiz, 966
_____

F.2d at 711, strongly suggested that, given the widespread nature

of the fraud and

the importance to the corporation of

revenues generated by it,

ignorance
truth.

of calculated

could have kept the company president from knowing the

The trial court

record supports the

error

only a conscious course

the extra

to it.

charged the jury on this principle,

instruction, and appellant has

In

itself, the

the

not assigned

resultant inference

suffices to

validate the finding of guilty knowledge.

We

will

not

paint

the

plenitude of evidence from which

inferred that
innocent

appellant was a

bystander.

economic

conclude

that appellant

corporation
compelling

perpetrator of the crime,

with the pervasiveness

statements
had

motive,

to
no

there

was

the jury rationally could

in the corporation's

powerful

false

Here,

have

not an

Indeed, when the extensive evidence showing

appellant's involvement
is coupled

lily.

it

procure

entirely

and

and appellant's
reasonable

participated in

Medicare

entitlement.

when we recall

of the fraud

seems

knew of,

day-to-day affairs

funds

This

that, in gauging

to

making,

which

conclusion

to

the

becomes

witness credibility

and choosing from among competing inferences, jurors are entitled

to take full advantage of their
sense.

collective experience and common

See United States v. Vargas, 945 F.2d 426, 429

___ _____________
______

(1st Cir.

1991); United States v. Smith, 680 F.2d 255, 260 (1st Cir. 1982),
_____________
_____
11

cert.
_____

denied, 459
______

U.S.

1110

(1983).

There are

limits

to

coincidence.
III.
III.

CONCLUSION
CONCLUSION
We

convergence
river of

need

go

no

further.5

In

this

instance,

the

of several lines of circumstantial evidence formed a

proof sufficient

to warrant the

See
___

Victoria-Peguero,
________________

920 F.2d at

And

because the evidence

need only support

the verdict, rather than

compel a conviction,

see
___

Echeverri,
_________

982

F.2d

at

86-87.

jury's finding.

678; Boylan,
______

appellant's assignment of error founders.

898

F.2d

at

243,

In the last analysis,

courts ought not stubbornly insist that criminal juries disregard

the obvious.

See United States

___ _____________

v. Ingraham, 832
________

(1st Cir. 1987), cert. denied, 486 U.S. 1009 (1988).

_____ ______

Affirmed.
Affirmed.
________

F.2d 229, 240

____________________

5Our determination that the evidence supports the verdict on

the "false statement" counts removes any need to consider the
specifics of the case in respect to the 130 counts charging
criminal conversion of public funds.
As appellant owned the
corporation, the ill-gotten gains necessarily inured to his
benefit.
12