Monday, January 31, 2011

Email, Business Records and Authentication

As I’ve explained in earlier posts, in order to introduce evidence – such as emails – at trial, the prosecutor or defense attorney must be able to show that the evidence meets the requirements of the applicable rules of evidence.

As Wikipedia notes, the rules of evidence “govern whether, when, how, and for what purpose, proof” in a court case “may be placed before a trier of fact”, i.e., a judge or a jury, “for consideration. As Wikipedia also notes, the rules of evidence used in the United States were

developed over several centuries and are based upon the rules from Anglo-American Common law, brought to the New World by early settlers. Their purpose is to be fair to both parties, disallowing the raising of allegations without a basis in provable fact. They are sometimes criticized as a legal technicality, but are an important part of the system for achieving a just result.

This post is about a case from Massachusetts in which the defendant – who had been convicted of “attempted rape of a child” and “solicitation of a prostitute” in violation of Massachusetts law – argued that two items of “documentary evidence” were improperly admitted at his trial. Commonwealth v. Amaral, 78 Mass. App. Ct. 671, __ N.E.2d __, 2011 WL 212833 (Massachusetts Court of Appeals 2011). This is how the case arose:

During the summer of 2007, State Trooper Peter Cooke began an undercover operation pretending to be a fifteen year old prostitute on Craigslist. . . . Cooke used the screen name `’ (Ashley) and posted a message -- `young teen looking for a friend . . . email me if u wanna talk’ -- in the `erotic services’ section of Craigslist.

On August 30, (Jeremy) contacted Ashley and stated, `My name is Jeremy, I'm 27 5'7” 152 lbs . . . [W]anna meet up?’ The two thereafter engaged in numerous brief e-mail communications, amounting to thirty-seven pages of text. In one, Ashley told Jeremy, `I am a 15 year old female,’ to which Jeremy responded, `Hey, I'm ok with it, but can I ask you why you wouldn't mind being friends with a 27 year old?’ Over the course of the communications, Ashley held herself out as a fifteen year old prostitute and Jeremy sent a picture of himself.

On . . . September 17, Jeremy sent an e-mail saying he was interested in meeting with Ashley later that day and sent her his telephone number. . . . Cooke engaged the assistance of a female trooper, Anna Brookes, to pretend to be Ashley and call the number Jeremy provided to arrange a meeting at a local strip mall . . . at 5:00 P.M. Brookes called . . . and addressed the other party as Jeremy, who said he wanted oral sex for fifty dollars. The arrangements were made. Prior to the meeting, Cooke learned that the number he received from Jeremy was registered to Jeremy Amaral. . . .

At approximately 5:00 P.M. on September 17, Cooke observed [Amaral] arrive in a car and park where Ashley had directed him. [He] exited his car and walked in front of the stores in the strip mall, going into a few establishments. Cooke asked Brookes to call [Amaral]. When she did, Cooke observed [Amaral] answer his telephone. At that point, [he] was arrested.

Commonwealth v. Amaral, supra. As I noted earlier, Amaral was charged with soliciting a prostitute and the attempted rape of a child, went to trial and was convicted on both charges. Commonwealth v. Amaral, supra. As I also noted, he appealed, arguing that the trial court improperly admitted two items into evidence:

(1) a printed copy of an electronic document provided by Yahoo! Inc. (Yahoo), an Internet service provider, linking him to a Yahoo account [Exhibit A]; and (2) electronic mail (e-mail) correspondence allegedly between him and the officer [Exhibit G].

Commonwealth v. Amaral, supra.

We, like the Court of Appeals, will start with Exhibit A. According to the opinion, at Amaral’s trial

to demonstrate that rdwmercury2006 was [Amaral], the Commonwealth introduced . . . exhibit A, which was a one-page document provided by Yahoo, labeled an account management tool, that indicated that the login name of rdwmercury2006 was registered to `Mr. Jeremy Amaral.’ An affidavit from the custodian of records for Yahoo, John P. Hernandez, accompanied the document.

Commonwealth v. Amaral, supra. The opinion notes that, among other things, the affidavit states that

`Yahoo! servers record this data automatically at the time, or reasonably soon after, it is entered or transmitted, and this data is kept in the course of this regularly conducted activity and was made by regularly conducted activity as a regular practice. Yahoo! provides most of its services to its subscribers free of charge. As such, Yahoo! does not collect billing information or verified personal information from the majority of our users.’

Commonwealth v. Amaral, supra. The document was admitted under the business record exception to the rule of evidence that bars the use of hearsay.

As I explained in an earlier post, hearsay essentially consists of one person’s testifying to something (i.e., “Fred told me Anna killed Tom”) as to which he or she has no first-hand knowledge. In this instance, the witness is simply repeating what he or she heard someone else say. As I explained in another post, the problem with this is that the person against whom such testimony is admitted (the defendant, presumably Anna, in this instance) can cross-examine the person who testified, but not Fred, who’s the one who said Anna killed Tom. That’s a problem for various reasons, the most important of which is that in the Anglo-American judicial system, cross-examination is considered to be essential in determining the truth of witnesses’ testimony.

There are, though, exceptions to the general rule barring hearsay. As I’ve noted in other posts, one of the exceptions is the business records exception. Wikipedia explains that the rationale for this exception is that the employees of a business are under a duty to

be accurate in observing, reporting, and recording business facts. The . . . belief is that special reliability is provided by the regularity with which the records are made and kept, as well as the incentive of employees to keep accurate records (under threat of termination or other penalty). The exception . . . allow[s] the record to substitute for the in-court testimony of the employees, but it can only substitute for what the employee could testify about.

Amaral argued that the Yahoo! document was “not a business record insofar as Yahoo `has no interest in the truth of the information it stores but simply records whatever the user enters.’” Commonwealth v. Amaral, supra. The Court of Appeals rather cursorily rejected his argument:

Little need be said about business records other than that they are a well known exception to the hearsay rule. See [Mass. General Laws 233 §§ 78 and 79]. . . . The foundational requirements of § 78 were met here and the document was properly admitted.

Commonwealth v. Amaral, supra.

That brings us to Exhibit G -- the “thirty-seven pages of e-mail communications between Jeremy and Ashley printed from Cooke's computer, in chronological order, starting from August 30, 2007.” Commonwealth v. Amaral, supra. Amaral argued that the document should not have been admitted because it had not been “properly authenticated”. Commonwealth v. Amaral, supra.

As I’ve noted in earlier posts, for an attorney to introduce evidence at trial, he/she must “authenticate” it, i.e., must show that the evidence is what it’s claimed to be. Rule 901(a) of the Massachusetts Guide to Evidence codifies this rule, stating that the “requirement of authentication or identification as a condition precedent to admissibility is satisfied by evidence sufficient to support a finding that the matter in question is what its proponent claims.”

In ruling on Amaral’s argument, the Court of Appeals noted that “`[a]uthenticity is usually proved by the testimony of a witness (1) that the thing is what its proponent represents it to be, or (2) that circumstances exist which imply that the thing is what its proponent represents it to be.’” Commonwealth v. Amaral, supra (quoting Commonwealth v. Williams, 456 Mass. 857, 926 N.E.2d 1161 (2010)). The court then explained that the

actions of the defendant served to authenticate the e-mails. One e-mail indicated that Jeremy would be at a certain place at a certain time and the defendant appeared at that place and time. In other e-mails, Jeremy provided his telephone number and photograph. When the trooper called that number, the defendant immediately answered his telephone, and the photograph was a picture of the defendant. These actions served to confirm that the author of the e-mails and the defendant were one and the same.

Commonwealth v. Amaral, supra. The Court of Appeals therefore affirmed Amaral’s convictions. Commonwealth v. Amaral, supra.

Friday, January 28, 2011

Computers and Health Care Fraud

This post deals with a recent New York case involving Saleem Khan’s prosecution for health care fraud in violation of New York Penal Law Article 177. People v. Khan, __ N.Y.S.2d __, 2011 WL 166725 (New York Supreme Court – Appellate Division 2011).

Specifically, Khan was charged with health care fraud in the fourth degree under New York Penal Law § 177.10. People v. Khan, supra. Section 177.10 provides as follows:

A person is guilty of health care fraud in the fourth degree when such person, on one or more occasions, commits the crime of health care fraud in the fifth degree and the payment or portion of the payment wrongfully received, as the case may be, from a single health plan, in a period of not more than one year, exceeds three thousand dollars in the aggregate.

Section 177.05 of the Penal Law says one commits health care fraud in the fifth degree when “with intent to defraud a health plan, he . . . knowingly and willfully provides false information or omits material information for the purpose of requesting payment from a health plan for a health care item”. That brings us back to Mr. Khan, who was charged as the result of an undercover investigation by New York police.

On November 15, 2007, undercover officer Pedro Gomez entered the NYC Pharmacy and asked the clerk, Marvin Portillo, for 40 pills each of the prescription medications Amitriptyline and Clonidine. . . . Portillo said that was too many pills to dispense without a prescription, and would have to ask his `boss.’ Portillo . . . spoke to [Khan]. Although [Khan] told Gomez it was a federal crime to sell those pills without a prescription, and he could lose his job if he did so, he eventually agreed to sell Gomez the Amitriptyline and Clonidine. . . . Portillo gave the detective two orange bottles containing pills . . . and the detective gave him two $20 bills. . . .

People v. Khan, supra. Gomez repeated the purchases two more times, once in November and the second time in February, 2008. People v. Khan, supra. Then, in “the second phase of the investigation,” Gomez presented prescriptions to Khan and asked

for medications not specified in the prescriptions. To pay for [them], Gomez used a New York State Benefit card (prepared by HRA to be used in this investigation) in the name of Ivonne Arroyo, a fictitious woman, whom Gomez said was his wife. . . . [W]hen a Medicaid recipient presents a prescription to a participating pharmacy, the pharmacy dispenses the medication and then bills Medicaid for reimbursement.

On February 28, 2008, Gomez presented defendant with a Zyprexa prescription (an antipsychotic drug), stating that it was for his girlfriend/wife. He also told [Khan] that `[t]hey gave [his wife] this because she's crazy,’ adding, `I don't want that, my wife is not crazy. Rather, he wanted Amitriptyline and Clonidine. . . . He told Portillo earlier that he wanted the pills so that he could make money.

[Khan] took the prescription to the back of the pharmacy, returned and had Gomez sign a book on the counter and the back of the Zyprexa prescription. Gomez signed `Ivonne Arroyo.’ [Khan] told Gomez he could give him 30 pills, but Gomez asked for . . . urging, `Come on I need to make a little money.’ After more negotiation, [Khan] agreed to give Gomez 40 pills. . . .

People v. Khan, supra.

Gomez came back on March 6 and got more Amitriptyline, and again on April with prescriptions for two “antiviral mediations” and Advair, saying he got them from his “`girl.’” People v. Khan, supra. He also asked for Percocet, a painkiller, for his cousin, but Khan said he could not give Gomez anything containing a controlled substance. People v. Khan, supra. Gomez them complained about

being hassled despite their past dealings. [Khan] explained that detectives might ask who provided the prescriptions. . . . Gomez signed the prescriptions, reassuring [Khan] that he was familiar with Arroyo's signature and would sign the way he had before. Defendant went to the back of the pharmacy, but returned and explained that he could not dispense the painkillers because they were not registered in the computer. [Khan] . . . told him to return on Saturday for the painkillers.

People v. Khan, supra. Gomez came back a final time on May 21, for Amitriptyline and Clonidine. Khan at first resisted, saying the prescriptions were “`not properly registered in the computer’” and a prescription had to be “`in the computer by the doctor in order to be dispensed, ”’otherwise he could not bill Medicaid for the prescriptions.” People v. Khan, supra. Khan eventually sold Gomez the pills. People v. Khan, supra.

Khan was charged with and convicted of several offenses, one of which was health care fraud in the fourth degree. People v. Khan, supra. He appealed, thereby bringing the first appeal of a conviction under Penal Law § 177.10. People v. Khan, supra. In ruling on his appeal, the New York appellate court addressed “the nature of proof required for a conviction.” People v. Khan, supra.

The court found that the evidence supported a conviction for health care fraud in the fourth degree “on the theory that the Medicaid claims misidentified the recipient of the medications.” People v. Khan, supra. Khan had argued that “under this theory, a customer who goes to a pharmacy to obtain medication for a spouse would be guilty of health care fraud merely because the insurance claim or Medicare claim is made in the spouse’s name.” People v. Khan, supra. The appellate court disagreed, pointing out that the definition of a “`person’ for purposes of prosecution under this statute excludes a recipient of a health care item . . .unless such person was an accessory to the fraud.” People v. Khan, supra.

Thus, absent evidence that a spouse under [Khan’s] hypothetical is involved in a scheme to defraud a health care plan, there would be no prosecution for health care fraud. Nor would a pharmacist who dispenses medications to someone other than the one for whom medications are prescribed commit fraud in the absence of evidence that the person picking up the medications is involved in an illegal scheme and the pharmacist is also aware of what is going on.

People v. Khan, supra.

The appellate court also rejected Khan’s other argument challenging his conviction on health care fraud in the fourth degree:

An additional element of a health care fraud prosecution is evidence that the defendant `provided’ the materially false information. Although the statute does not expressly specify to whom the information is provided, nor does it limit the method by which the information is provided, it must be for the purpose of requesting payment from a health plan for a health care item or service. . . .

According to [Khan],, there is no evidence that [he] was the person who actually misled Medicaid. The statute, however, does not require that the People establish that [Khan] personally provided the false information to Medicaid. It is enough that he relayed that information to someone for the purpose of requesting payment from a health care plan. Whether the bookkeeper or a secretary actually entered the information via computer is irrelevant in prosecuting [Khan].

People v. Khan, supra.

The court noted that various evidence, such as the time-lines involved in the billings for the medications dispensed to Gomez, inferentially indicated Khan “provided” the false information to Medicaid. People v. Khan, supra. And it also pointed out that “on two different occasions,” Khan told Gomez he could not “dispense . . . certain medications because they were `not properly registered on the computer.’” People v. Khan, supra.

The majority of the Supreme Court – Appellate Division upheld Khan’s conviction for health care fraud and for the other offenses with which he was charged. People v. Khan, supra. One justice – Justice Catterson – dissented. People v. Khan, supra.

Justice Catterson argued that the evidence was flawed in various respects, one of which was that there was

no evidence that [Khan] suspected or knew Arroyo did not exist. Only Gomez and the investigators knew Arroyo was a fictitious individual. Further, based on the explanations [Khan] made to Gomez as to why he could not dispense Percocet, it is evident that the pharmacy used a system where legitimate prescriptions are entered by doctors into a computer database in order that they can be billed to Medicaid. Since Arroyo's prescriptions evidently were entered in the computer, there was no basis for [Khan] to believe Arroyo was not a real patient; or that Gomez, who had never identified himself by name, or shown [Khan] any identification, was not indeed her husband or boyfriend.

Consequently, the majority's position that [Khan] knowingly misidentified the recipient because `[he] knew Ivonne Arroyo was not the recipient of the medications, but rather Gomez, who wanted the drugs to sell for a profit’ is not supported by the evidence as to the March 6, 2008 incident. Such conclusion requires evidence that, on March 6, 2008 [Khan] gave Gomez the pills he asked for instead of dispensing the prescribed medication. This however, as the majority clearly holds, is precisely the evidence that was not proferred. Hence, the element of `knowingly and willfully provid[ing] materially false information’ was not proved beyond a reasonable doubt.

People v. Khan, supra. (In the March 6, 2008 transaction, Khan gave Gomez a bottle labeled as containing the medication for which Gomez submitted a prescription, but Gomez later said the pills in the bottle were the Amitriptyline he had gotten before; according the dissent, these pills were not introduced into evidence or analyzed.) People v. Khan, supra.

Justice Catterson found that the prosecution’s failure “to prove beyond a reasonable doubt” that Khan “materially misinformed Medicaid as to the drugs dispensed or as to the recipient of the medication” impacted “the value elements” of the health care fraud conviction. People v. Khan, supra. The dissenting judge would, therefore, have reduced the charge to a conviction for health care fraud in the fifth degree and remanded the case for resentencing, i.e., for a reduced sentence. People v. Khan, supra.

Wednesday, January 26, 2011

E-mails, “Marital Difficulties” and the Attorney-Client Privilege

As Wikipedia explains, the attorney-client privilege is “a legal concept that protects certain communications between a client and his or her attorney and keeps those communications confidential.”

And as Wikipedia notes, the attorney-client privilege is

one of the oldest recognized privileges for confidential communications. The United States Supreme Court has stated that by assuring confidentiality the privilege encourages clients to make `full and frank disclosures to their attorneys, who are then better able to provide candid advice and effective representation.

Wikipedia (quoting Upjohn v. U.S., 449 U.S. 383 (1981)).

As Wikipedia explains, the following is necessary to establish the existence of the privilege:

1. The asserted holder of the privilege is (or sought to become) a client; and

2. The person to whom the communication was made:

1. is a member of the bar of a court, or his subordinate, and

2. in connection with this communication, is acting as an attorney; and

3. The communication was for the purpose of securing legal advice.

That brings us to Parnes v. Parnes, __ N.Y.S.2d ___, 2011 WL 102664 (New York Supreme Court – Appellate Division, 2011). Linda and Steven Parnes had been married for some unspecified amount of time when they “began experiencing marital difficulties”. Parnes v. Parnes, supra. At that point, Steven contacted

Paul Van Ryn, an attorney who had represented him in a prior divorce and related proceedings. . . . Van Ryn had also represented and dealt with both parties in their capacities as principals in a limited liability company. [Steven] and Van Ryn exchanged e-mails discussing a strategy for [Steven] to gain advantage in future matrimonial and custody litigation.

[Steven] acted in response to some of these e-mails, including sending a letter to [Linda’s] physician stating that [Steven] -- also a physician --disagreed with certain medication being prescribed and would no longer pay for this treatment, which was considered medically unnecessary as evidenced by an insurance company's refusal to cover the medication.

Parnes v. Parnes, supra. At some point after this, Linda “commenced” the divorce action that produced the opinion we’re examining. Parnes v. Parnes, supra.

At some point after that, Steven’s deposition was scheduled. At his deposition, Linda’s

counsel questioned [Steven] about his e-mails with Van Ryn. [Linda] apparently discovered a page of one of the e-mails on [his] desk and, while searching for the remainder of the letter, discovered the user name and password for [Steven’s] e-mail account.

She used the password to gain access to [his] account, printed the e-mails between him and Van Ryn, and turned them over to her counsel. [Linda[ then amended the complaint to reflect that [Steven] conspired with Van Ryn to cause [her] anguish. Counsel subpoenaed Van Ryn for a deposition and to produce documents.

Parnes v. Parnes, supra. Van Ryan moved to quash the subpoena, and Steven “cross-moved” to quash the Van Ryan subpoena, “preclude [Linda] from using any privileged communications between [him] and Van Ryan, strike the portions of [Linda’s] complaint based on privileged information and disqualify” her attorney. Parnes v. Parnes, supra. The trial court “found that the emails between Van Ryan” and Steven “were protected by the attorney-client privilege” and granted both Van Ryan and Steven the relief they asked for. Parnes v. Parnes, supra. Linda appealed this decision to the New York Supreme Court – Appellate Division, which issued the opinion we’re examining here.

The Supreme Court agreed with the trial court’s determination that the emails were protected by the privilege:

[Steven] met his burden of demonstrating that he and Van Ryn communicated as an attorney and client and `that the information sought to be protected from disclosure was a ‘confidential communication’ made to the attorney for the purpose of obtaining legal advice or services. (Matter of Priest v. Hennesy, 51 N.Y..2d 62 (1989). . . . [Steven] averred that, while he had been friends with Van Ryn for many years, he contacted Van Ryn in his capacity as an attorney to seek advice about a potential divorce and custody battle.

The context of the e-mails shows Van Ryn was giving legal advice, sent from his law firm e-mail address, and billed [Steven] for his time. Van Ryn provided [Steven] with a retainer agreement; although they never executed it, Van Ryn averred that he did not require an executed agreement from clients until the matter proceeded to litigation or negotiations, and clients frequently sought advice before those stages without an executed retainer agreement.

Parnes v. Parnes, supra. So the requirements outlined above were satisfied.

The Supreme Court also found, though, that Steven waived the attorney-client privilege “with respect to one page of one email.” Parnes v. Parnes, supra.

As the proponent of the privilege, defendant bore the burden of proving that he did not waive it. . . . [Linda] averred that she discovered a single printed page of a five-page e-mail on a desk in the marital residence. The parties acknowledge that this desk was located in a room used as an office and the parties, their nanny and babysitters all used that room.

[Steven] contends that the desk contained only his papers and [Linda] had her own desk in the same room, but [she] appears to disagree.

Regardless of whether the parties had separate desks, by leaving a hard copy of part of a document on the desk in a room used by multiple people, [Steven] failed to prove that he took reasonable steps to maintain the confidentiality of that page. . . . Hence, [he] waived the privilege as to that one page, and [Linda] may use that single page in litigation.

Parnes v. Parnes, supra.

The Supreme Court reached a different conclusion with regard to the other emails at issue:

[Steven] took reasonable steps to keep the e-mails on his computer confidential. [He] set up a new e-mail account and only checked it from his workplace computer. Leaving a note containing his user name and password on the desk in the parties' common office in the shared home was careless, but it did not constitute a waiver of the privilege. [Steven] still maintained a reasonable expectation that no one would find the note and enter that information into the computer in a deliberate attempt to open, read and print his password-protected documents. . . .

[Linda] admits that after she found the one page, she searched through [Steven’s] papers in an effort to find the rest of the document, instead found the note, then purposely used the password to gain access to [his] private e-mail account, without his permission, to uncover the remainder of the e-mail. Under the circumstances, [Steven] did not waive the privilege as to the e-mails in his private e-mail account.

Parnes v. Parnes, supra.

The court also rejected Linda’s argument that the “crime-fraud exception precluded” application of the privilege to the emails. Parnes v. Parnes, supra. As Wikipedia notes, the crime-fraud exception to the attorney-client privilege can render

the privilege moot when communications between an attorney and client are themselves used to further a crime or fraud. In Clark v. United States, [289 U.S. 1, (1933)], the U.S. Supreme Court writes that `A client who consults an attorney for advice that will serve him in the commission of a fraud will have no help from the law. He must let the truth be told.’ The crime-fraud exception also does require that the crime or fraud discussed between client and attorney be carried out to be triggered.

The New York Supreme Court’s Appellate Division found that Steven’s letter to Linda’s

physician did not constitute a fraud upon [Linda] or the physician. [Steven] expressed his personal opinion that [she] should not be taking human growth hormones, an opinion supported by the insurance company's refusal to cover that treatment.

[Steven] also informed the physician that [he] would no longer pay for this treatment. While [Linda] contends that [Steven] had evil motives for sending this letter and providing her a copy -- namely to deprive her of necessary medicine and cause her mental anguish – [his] actions did not constitute a fraud regardless of his intentions. . . . Based on the insurance company's refusal, presumably due to its determination that the treatment was not medically necessary, [the trial judge] did not err in finding that [Steven], as [Linda’s] former physician, did not breach a fiduciary duty to her by sending the letter.

Although she describes the strategy discussed by defendant and Van Ryn as an attempt to make her `snap,’ [Linda] was not doing so by breaching a fiduciary duty. [She] offers only speculation that [Steven] conspired to commit the crime of assault upon her, without any probable cause to support her assertion. . . . Although case law also applies the crime-fraud exception to `other wrongful conduct,’ such conduct must usually be of a criminal or dubious nature, not merely mean or dishonorable.

Parnes v. Parnes, supra. The appellate court therefore reversed the part of the trial judge’s order that “found that the third page of a five-page email from Paul Van Ryn to [Steven] is privileged”. Parnes v. Parnes, supra.