Saturday, November 20, 2010

Computer Logs and Obstruction of Justice

As one website notes, obstruction of justice is a “criminal offense that involves interference, through words or actions, with the proper operations of a court or officers of the court.” As this site also notes, law criminalizes acts interfering with the operations of a court because the “integrity of the judicial system depends on the participants’ acting honestly”.

This post is about a federal case in which the defendant was, among other things, charged with obstructing justice.

The case is U.S. v. Reddy, 2010 WL 3211029 (U.S. District Court for the Northern District of Georgia 2010), and this is how it arose:

[Rajashakher P. Reddy] is a board-certified radiologist who owns and operates Reddy Solutions, Inc. (`RSI’), a company offering around-the-clock professional radiology services to various healthcare facilities. Essentially, the hospital or other facility sends its X-Rays, Magnetic Resonance Images, CT scans and other imaging tests via electronic transmissions to RSI, so [Reddy], or an RSI-contract radiologist, can review them for a fee and then provide the client with a diagnostic report.

Clients would bill Medicare or other insurers for RSI's `professional services’. Although RSI employs `Radiology Practice Assistants’ (`RPAs’) to assist the radiologists and draft preliminary reports, RPAs are not physicians and cannot render clinical findings or diagnoses. Rather, `a physician must . . . perform an independent review of the radiology films and data before accepting the findings and diagnosis in the draft report and signing it.’

The indictment alleges that [Reddy] fraudulently signed and submitted radiology reports for approximately 40,000 patients to the hospitals and other RSI clients where neither he nor any other RSI physician had reviewed and analyzed the file. Instead, it is alleged that [he] simply signed and submitted reports drafted by the RPAs without checking their accuracy, thus fraudulently passing off the RPAs' preliminary reports as final radiology reports prepared by a board-certified radiologist. [Reddy] allegedly received over $1.5 million for this scheme.

U.S. v. Reddy, supra. Reddy was charged with “multiple counts” of wire fraud, mail fraud and health care fraud under federal law . . . and with “falsification of records in a federal investigation” in violation of 18 U.S. Code § 1519. U.S. v. Reddy, supra. The last charge is the only one we’re concerned with.

Section 1519 of Title 18 of the U.S. Code provides as follows:

Whoever knowingly alters, destroys, mutilates, conceals, covers up, falsifies, or makes a false entry in any record, document, or tangible object with the intent to impede, obstruct, or influence the investigation or proper administration of any matter within the jurisdiction of any department or agency of the United States or any case filed under title 11, or in relation to or contemplation of any such matter or case, shall be fined under this title, imprisoned not more than 20 years, or both.

(emphasis added). Count 34 of the original indictment alleged the following:

In or about February 2008, in the Northern District of Georgia, the defendant, DR. RAJASHAKHER P. REDDY, did knowingly alter, destroy, conceal, cover up, falsify and make a false entry in a record, document, and tangible object, with the intent to impede, obstruct, or influence the investigation or proper administration of any matter within the jurisdiction of department and agency of the United States, in that the Defendant did cause others to alter and falsify certain records known as `access logs’ maintained by Reddy Solutions, Inc., and to have those falsified records produced to the United States Department of Justice and United States Department of Health and Human Services, in response to a subpoena dated January 29, 2008, all in violation of title 18, United States Code, Sections 1519 and 2.

Motion to Dismiss Count 34, U.S. v. Reddy, 2009 WL 6919659 (2009). (The count references both sections 1519 and 2 because it at least implicitly alleges that Reddy committed the § 1519 offense in cooperation with others – i.e., with accomplices.)

This count is the one Reddy targeted in the motion to dismiss we’ll get to in a moment. A superseding indictment that was returned about a year after the original one added additional factual allegations:

[A]t the direction of the Defendant, DR. RAJASHAKHER P. REDDY, a RSI information technology employee altered and falsified these access logs before they were produced to the United States. The original records as maintained by RSI's system reflected that in many cases neither the Defendant nor any other physician reviewed the radiological images in numerous cases. Rather, according to the original unaltered data, the sole RSI personnel who reviewed various images were non-physician . . . RPAs. Thus, at the Defendant's direction, these records were altered before production to the United States to insert the Defendant's username in various entries where it did not originally appear, and to replace entries reflecting that certain RPAs had accessed the film images instead. In other words, the altered records falsely showed that the Defendant had accessed certain images of films, which, according to the original unaltered records, he had not.

After the access logs were falsified, the Defendant, DR. RAJASHAKHER P. REDDY, directed another employee to produce the set of falsified records to RSI's lawyers who then produced the false materials to the United States in response to the subpoena.

Second Superseding Indictment, U.S. v. Reddy, 2010 WL 3924163 (2010).

Reddy moved to dismiss Count 34 (which became Count 37 in the later indictment), arguing that the phrase “any record” as used in § 1519 was not intended to cover

electronic records such as the `access logs’ he allegedly altered or falsified, and therefore count 37 does not allege an actual crime. [Reddy] bases his argument on the fact that Congress, in passing 18 U.S. Code § 1520 concurrently with § 1519, used the phrase `records’ (including electronic records)’ in the former but made no specific mention of `electronic’ in the latter. . . .

Therefore, [Reddy] argues, § 1519 was clearly intended to not pertain to electronic records, because `[w]here Congress includes particular language in one section of a statute but omits it in another . . . it is generally presumed that Congress acts intentionally and purposely in the disparate inclusion or exclusion.’

U.S. v. Reddy, supra (quoting Motion to Dismiss Count 34, supra).

As the government pointed out in its response to Reddy’s motion to dismiss the § 1519 count, both §§ 1519 and 1520 were added to the federal criminal code by the Sarbanes-Oxley Act of 2002, Pub. L. 107-204, 116 Stat. 745. Government’s Response to Defendant’s Motion to Dismiss, U.S. v. Reddy, 2010 WL 3924157 (2010). The government’s response also explained that Reddy’s comparison of §§ 1519 and 1520

misses the mark. Section 1520 addresses regulations promulgated by the Security and Exchange Commission for the retention of records. `Electronic records’ are referred to in a list of the types of records that will be regulated by the SEC's retention rules. In contrast, § 1519 deals with the destruction, alteration and falsification of records in the context of a federal investigation. Consequently, the provisions address very different issues and serve different purposes. . . .

Moreover, taken to its logical conclusion, [Reddy’s] argument leads to extreme results. If § 1519 only applied to paper records, a criminal could engage in the most wanton obstruct without fear of prosecution, provided the records were not in paper form at the time. In other words, he could alter, falsify mutilate or destroy any computerized record in anticipating of a federal investigation as long as he did not alter the same record that was reduced to paper. This . . . is an odd result given the breath of the statutory language and the harms it was intended to address.

Government’s Response Defendant’s Motion to Dismiss, supra.

In ruling on Reddy’s motion to dismiss the § 1519 count, the federal district judge who has the case agreed “with the Government’s position that `§§ 1519 and 1520 cover different topics’” and held that “`[t]he latter statute does not refer to or otherwise relate to the former, and therefore its use of different language shines no light on an already clear statute.’” U.S. v. Reddy, supra (quoting Government’s Response Defendant’s Motion to Dismiss, supra).

The judge also did not find

any ambiguity in the phrase `any record.’ The word `any’ means just that -- every and all without qualification or specification. The computer access logs are a record of who accessed the computer and when, and therefore they fall within this classification. In other words, the term `any record’ in 18 U.S. Code § 1519 clearly applies to electronic records such as the computer `access logs’ [Reddy] allegedly falsified. Due to the plain language of the statute, there is no need to resort to alternative methods of statutory interpretation.

U.S. v. Reddy, supra. The judge therefore denied Reddy’s motion to dismiss the count. U.S. v. Reddy, supra.

If you’d like to read a little more about the case, check out the press release you can find here.

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