U.S. v. Bynum

OPINION AND ORDER After a two-week jury trial, Defendant William Bynum was acquitted of conspiracy to commit health care fraud and wire fraud in violation of 18 U.S.C. §§1343, 1347, 1349 (Count One), and convicted of conspiracy to make false statements relating to health care matters in violation of 18 U.S.C. §§371, 1035 (Count Two). See Verdict Sheet, Dkt. 1158; Superseding Indictment (“S9″), Dkt. 927.¹ Mr. Bynum moved for acquittal on Count Two pursuant to Rule 29 of the Federal Rules of Criminal Procedure or a new trial pursuant to Rule 33 of the Federal Rules of Criminal Procedure on the grounds that the Court’s conscious avoidance jury instructions were erroneous. See Def. Mem., Dkt. 1182. For the following reasons, Mr. Bynum’s motion is DENIED. BACKGROUND The National Basketball Association (“NBA”) offers a Health and Welfare Benefit Plan (the “Plan”) that is funded by the NBA for the benefit of basketball players who have played for teams in the league and their families. See Tr. 207:2-16, 345:19-346:12; DX 43 at 11. Mr. Bynum is a former NBA player and Plan participant. See Tr. 1466:25-1467:8, 1476:25-1477:4, 1479:22-1480:12, 1516:21-1517:12; DX 35. The Plan provides each participant with a health reimbursement account (“HRA”). See Tr. 359:4-13, 1884:7-12, 1886:7-15. The Plan is available to reimburse participants, their spouses, and their dependents for otherwise unreimbursed health care costs. See id. 207:2-16, 1887:8-10. Reimbursements from the Plan for health care expenses are not taxable income to Plan participants. See id. 208:25-209:15. From about 2017 to 2021, Mr. Bynum and other former NBA players submitted false invoices seeking reimbursement for health care expenses that were never actually incurred. See id. 46:20-47:3, 435:14-436:6, 445:14-447:8, 449:6-10; S9 1. Former NBA player Terrence Williams contacted Mr. Bynum in 2018. See Tr. 1514:4-1516:20. Mr. Williams asked Mr. Bynum where he had received medical services and offered to provide invoices so that Mr. Bynum could obtain Plan funds. See id. 1518:8-24. Mr. Bynum testified that he thought Mr. Williams was helping him legitimately access Plan funds because Mr. Williams had been an NBA player and because Mr. Bynum believed Mr. Williams was working for the NBA Players’ Association (the “Players’ Association”).² See id. 206:4-5, 1518:18-1519:3. In July 2018, Mr. Bynum learned from the Plan’s administrator, United Medical Resources (“UMR”), that he had a balance of approximately $275,000 in his HRA account. See GX 401; GX 401T.³ Around the time of their first contact on this issue, Mr. Williams texted Mr. Bynum, “You gonna have to pay tax [and] Fee but [I] can get you A LOT[.]” GX 1000-A; see also Tr. 1562:12-18. He also indicated that Mr. Bynum would need to pay him around $40,000; Mr. Bynum responded, “ Let’s get it[.]” GX 1000-A; see also Tr. 1562:22-1563:24, 1564:23-1565:11. Mr. Bynum testified that Mr. Williams’s request for a tax payment made him believe that the transaction was legitimate. See Tr. 1566:20-22.⁴ That same day, in an email with the subject line “2018 200k William Bynum,” Mr. Williams sent Mr. Bynum twenty pages of fake invoices for services Mr. Bynum purportedly received at the Advanced Chiropractic & Rehab Center (the “Rehab Center”) in California.⁵ See GX 602. Mr. Bynum never received those services; he was based in Illinois at the time they were supposedly provided. See Tr. 1519:19-1520:14, 1813:10-21; GX 602.⁶ Although Mr. Bynum testified that he received services from the Rehab Center “hundreds of times” over the years and that he paid for those services in cash, see Tr. 1577:10-14, 1506:3-9, the Rehab Center did not have any patient records for Mr. Bynum, see id. 740:4-16, 1768:6-19.⁷ Two weeks after receiving the fake invoices from Mr. Williams, Mr. Bynum used the invoices to submit a claim (the “Claim”) for $200,000 to UMR. See Tr. 550:21-551:8, 557:21-558:13; GX 408. The Claim form contained Mr. Bynum’s electronic signature and identifying information, the dates of purported services, the service provider, and the total requested reimbursement amount. See GX 408; Tr. 1637:15-1638:10.⁸ Mr. Bynum called UMR before and after submitting the Claim form to ensure that it was properly completed and to inquire about the Claim’s progress throughout the payment process. See Tr. 561:23-562:21; GX 419; GX 400.⁹ Mr. Bynum eventually told Mr. Williams that the Claim had been submitted and verified; he also told Mr. Williams that he would keep him updated. See GX 1001-A; Tr. 1567:14-1569:13. Mr. Williams later told Mr. Bynum that he was on the phone with the NBA and that Mr. Bynum would receive $182,224 in his account by the following day. See GX 1001-C; Tr. 1574:4-12. Mr. Bynum received payment from UMR on December 10, 2018, see GX 1551 at 241; Tr. 1648:16-1649:3, and Mr. Bynum paid Mr. Williams $30,000¹⁰ two days later, see GX 1551 at 241; Tr. 1616:5-7; 1649:4-12. In 2021, Mr. Bynum was charged with conspiracy to commit health care fraud and wire fraud in violation of 18 U.S.C. §§1343, 1347, 1349 (Count One). See Indictment, Dkt. 2. In 2022, Mr. Bynum was charged with a separate conspiracy to make false statements relating to health care matters in violation of 18 U.S.C. §371, 1035 (Count Two). See Superseding Indictment, Dkt. 497. He was tried with one of his co-conspirators, Ronald Glen Davis. During the charge conference, Defendants objected to the jury being charged on conscious avoidance. See Tr. 1706:4-1710:2, 1718:11-1720:18. The Court overruled the objection but edited the draft charge to make clear that, although the jury could consider whether a Defendant consciously avoided knowing the goal of the charged conspiracies, the jury could not use a conscious avoidance theory to decide that the Defendant had knowingly joined either of the charged conspiracies. Id.¹¹ On November 15, 2023, the jury acquitted Mr. Bynum on Count One and convicted Mr. Bynum on Count Two. See Verdict Sheet; Tr. 2186:16-19, 2187:6-9. DISCUSSION I. Legal Standard Federal Rule of Criminal Procedure 29(a) provides that a court must “enter a judgment of acquittal of any offense for which the evidence is insufficient to sustain a conviction.” “‘[T]he relevant question is whether, after viewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt.’” United States v. Taylor, 475 F. App’x 780, 781 (2d Cir. 2012) (quoting Jackson v. Virginia, 443 U.S. 307, 319 (1979)). “‘[A] judgment of acquittal’ is warranted ‘only if the evidence that the defendant committed the crime alleged is nonexistent or so meager that no reasonable jury could find guilt beyond a reasonable doubt.’” United States v. Jiau, 734 F.3d 147, 152 (2d Cir. 2013) (quoting United States v. Espaillet, 380 F.3d 713, 718 (2d Cir. 2004)). “A court examines each piece of evidence and considers its probative value before determining whether it is unreasonable to find ‘the evidence in its totality, not in isolation,’ sufficient to support guilt beyond a reasonable doubt.” United States v. Goffer, 721 F.3d 113, 124 (2d Cir. 2013) (quoting United States v. Autuori, 212 F.3d 105, 114 (2d Cir. 2000)). Courts “‘resolve all inferences from the evidence and issues of credibility in favor of the verdict.’” United States v. Zayac, 765 F.3d 112, 117 (2d Cir. 2014) (quoting United States v. Howard, 214 F.3d 361, 363 (2d Cir. 2000)). “‘[T]he jury’s verdict may be based entirely on circumstantial evidence.’” Goffer, 721 F.3d at 124 (quoting United States v. Santos, 541 F.3d 63, 70 (2d Cir. 2008)). Federal Rule of Criminal Procedure 33(a) provides that “[u]pon the defendant’s motion, the court may vacate any judgment and grant a new trial if the interest of justice so requires.” Fed. R. Crim. P. 33(a); see also United States v. James, 712 F.3d 79, 107 (2d Cir. 2013). “The ultimate test on a Rule 33 motion is whether letting a guilty verdict stand would be a manifest injustice.” United States v. Ferguson, 246 F.3d 129, 134 (2d Cir. 2001). “To grant the motion, ‘there must be a real concern that an innocent person may have been convicted.’” United States v. Aguiar, 737 F.3d 251, 264 (2d Cir. 2013) (quoting Ferguson, 246 F.3d at 134). An erroneous jury instruction warrants a new trial if it was not harmless. See United States v. Sheehan, 838 F.3d 109, 121 (2d Cir. 2016). II. The Jury Instructions Were Not Erroneous Mr. Bynum argues that the jury instructions were erroneous because they misled the jury into believing that it could convict Mr. Bynum on a conscious avoidance theory of joining a conspiracy he did not know existed. See Def. Mem. at 1. Even if the jury instructions were not misleading, Mr. Bynum asserts, a conscious avoidance instruction was erroneous because no rational factfinder could have concluded that he consciously avoided knowing that the conspiracy he joined had unlawful aims. See id. Mr. Bynum’s arguments are unavailing. A. The Jury Instructions Were Not Misleading 1. Legal Standard “There are ‘two aspects of knowledge in a conspiracy: [(1)] knowing participation or membership in the scheme charged and [(2)] some knowledge of the unlawful aims and objectives of the scheme.’” United States v. Ferrarini, 219 F.3d 145, 154-55 (2d Cir. 2000) (quoting United States v. Lanza, 790 F.2d 1015, 1022 (2d Cir. 1986)). Although conscious avoidance “may not be used to support a finding as to the former,” it “may be used to support a finding with respect to the latter, i.e., knowledge of the conspiracy’s unlawful goals.” Id. (citations omitted). When determining whether a jury charge was proper, courts consider the charge “as a whole.” United States v. Svoboda, 347 F.3d 471, 482 (2d Cir. 2003); see also Cupp v. Naughten, 414 U.S. 141, 146-47 (1973) (noting the “well established proposition” that a jury instruction “must be viewed in the context of the overall charge”). 2. Application Mr. Bynum primarily argues that the jury instructions for Count Two were misleading because they did not specify that the jury could not find that Mr. Bynum knowingly joined the conspiracy on a conscious avoidance theory. See Def. Mem. at 1, 7-9. Mr. Bynum’s argument assumes, however, that the jury instructions for Count Two were read in isolation. That is not the law. See Ferrarini, 219 F.3d at 155-56 (concluding that a jury could not have found that the defendant intended to participate in the conspiracy based on conscious avoidance because the charge “as a whole” was proper; the instructions “explicitly” provided when a conscious avoidance theory was available); Svoboda, 347 F.3d at 481-82 (concluding that a conscious avoidance jury charge was not erroneous in part because the jury instructions, “as a whole, repeatedly and emphatically instructed the jury” as to the conspiracy charge’s mens rea requirement). The Court first instructed the jury on two substantive charges that were pending against Mr. Bynum’s co-defendant — wire fraud and health care fraud — and then instructed the jury on the two conspiracy charges that were pending against both Defendants — conspiracy to commit wire fraud and healthcare fraud (Count One) and conspiracy to make false statements related to healthcare matters (Count Two). See Tr. 2143-2182; Jury Charge, Dkt. 1151. Read in context, the instructions for Count Two were not misleading. Beginning with the substantive charges, the Court instructed the jury that, to act “knowingly” and “intentionally,” a person must act “voluntarily and deliberately, rather than mistakenly or inadvertently,” and that a person’s actions “must have been his conscious objective rather than the product of mistake, accident, negligen[ce], or some other innocent reason.” Tr. 2160:19-24. Finding that a defendant acted “with a conscious purpose to avoid learning the truth about the fraudulent nature of [a] scheme,” or that a defendant was “aware of a high probability that the scheme was fraudulent and that the [d]efendant acted with deliberate disregard of that high probability,” the Court instructed, was enough to find that the defendant acted “knowingly.” Id. 2161:24-2162:7. With respect to Count One — the conspiracy to commit wire and health care fraud — the Court directed the jury to apply the same instructions when deciding whether a Defendant “knowingly” and “willfully” joined the conspiracy, the goal of which was to commit wire fraud and healthcare fraud. Id. 2170:22-24. The Court explained that “[t]here are two parts” to the existence of a conspiracy: “an agreement and an illegal goal.” Id. 2169:14-16. “As with [the] substantive offenses of wire fraud and health care fraud,” if the jury found that a Defendant “deliberately and consciously avoid[ed] learning the illegal goal of the conspiracy,” then it could find that the Defendant acted knowingly. Id. 2171:11-15. Although the jury could consider conscious avoidance in deciding whether a Defendant knew the goal or goals of the conspiracy, the Court explained, it could not do so “in deciding whether the defendant knowingly and willfully joined the conspiracy.” Id. 2171:21-25. The jury instructions for Count Two provided, in relevant part, that the Government had to prove that the Defendant “knowingly and intentionally became a member of the conspiracy,” and directed the jury to apply the Court’s previous instructions regarding the definitions of “knowing” and “intentionally.” Id. 2174:6-10. The Court repeated its charge from Count One that, to establish the existence of a conspiracy, the Government needed to prove “an agreement and an illegal goal.” Id. 2173:10-13. “As was with the case of [Count One],” the Court instructed, the jury could find that a Defendant acted knowingly if he “deliberately and consciously avoided learning the illegal goal of the conspiracy.” Id. 2174:11-16. Read as a whole, the jury instructions expressly provided that Mr. Bynum must have joined the conspiracy “voluntarily and deliberately” rather than innocently or accidentally to be found guilty. But after finding that the Defendant had knowingly and intentionally joined the conspiracy, the jury could use a conscious avoidance theory to find that the Defendant knew the illegal goal of the conspiracy. See United States v. Khalupsky, 5 F.4th 279, 297 (2d Cir. 2021) (concluding that the jury could not have convicted the defendants “by finding only conscious avoidance of the fact of participation in the conspiracy” because the jury instructions “made clear that proof of membership in the conspiracy required a showing of actual knowledge”); United States v. Lange, 834 F.3d 58, 76-77 (2d Cir. 2016) (same even though the Court overruled Defense counsel’s requested instruction “that conscious avoidance may never be used as a substitute for knowing participation in a conspiracy” because the instructions “clearly provided that the Government had to prove that the defendants intentionally engaged in the conspiracy”). The Court’s instruction that there are “two parts” to the existence of a conspiracy — an agreement and an illegal goal — facilitated the jury’s application of two different knowledge theories. See Ferrarini, 219 F.3d at 155-56 (affirming a conscious avoidance conspiracy jury charge instructing the jury to “determine not only whether [the defendant] participated in [the conspiracy], but whether he did so with knowledge of its unlawful purposes”).¹² For all of those reasons, the jury instructions were legally correct and were not misleading. B. The Conscious Avoidance Charge Was Warranted 1. Legal Standard A conscious avoidance instruction is warranted if (1) the defendant asserts “‘the lack of some specific aspect of knowledge required for conviction’” and (2) if the evidence would allow a rational juror to conclude that the defendant “‘was aware of a high probability of the criminal objective and consciously avoided confirming the fact.’” United States v. Lewis, 545 F. App’x 9, 11 (2d Cir. 2013) (cleaned up and quoting Ferrarini, 219 F.3d at 154). “‘Red flags’ about the legitimacy of a transaction ‘can be used to show both actual knowledge and conscious avoidance.’” Id. at 12 (quoting Ferguson, 676 F.3d at 278). 2. Application Mr. Bynum conceded at the outset of trial that he received fake invoices from Mr. Williams, submitted those invoices to the Plan for reimbursement, was reimbursed, and paid Mr. Williams a portion of his ill-gotten gains. See Tr. 46:20-47:3. Email, text, phone, and bank records, as well as Mr. Bynum’s own testimony, confirmed that those things happened. See supra, Background. The key issues at trial were whether Mr. Bynum knowingly joined either or both of the charged conspiracies and whether he knew or suspected that his Claim was based on fake invoices. See Tr. 47:3-5. Mr. Bynum repeatedly testified that, despite the myriad suspicious circumstances surrounding the Claim and his communications with Mr. Williams, he never suspected any unlawful conduct or false statements. See, e.g., Tr. 1516:2-7, 1518:2-7, 1522:14-1523:8. Mr. Bynum, therefore, asserted a “lack of some specific aspect of knowledge required for conviction,” Lewis, 545 F. App’x at 11, satisfying the first condition that warrants giving a conscious avoidance instruction, see United States v. Aina-Marshall, 336 F.3d 167, 171 (2d Cir. 2003) (concluding that a conscious avoidance charge “is appropriate in all but the highly unusual — perhaps non-existent — case” if a defendant testifies that he lacked the requisite knowledge for conviction). Ample evidence emerged at trial for a juror to discredit Mr. Bynum’s testimony and to find that he either knew or consciously avoided knowing that his Claim contained false information. Instead of obtaining invoices from the Rehab Center, Mr. Bynum obtained invoices from Mr. Williams, a former NBA player who used his personal email address for supposedly official NBA business, and who provided invoices that totaled exactly $200,000. The fake invoices listed services that Mr. Bynum never received, and the services were purportedly provided by the Rehab Center, which has no record of treating Mr. Bynum. The Rehab Center is based in California, and the purported services were provided during a period when Mr. Bynum was residing in Illinois. Mr. Williams required Mr. Bynum to pay him a fee and purported taxes even though Plan reimbursements were not taxable and there was no explanation why taxes would be paid to Mr. Williams rather than to the taxing authorities. Mr. Williams pestered Mr. Bynum about the Claim even after he had purportedly eliminated his “fee” but there is no explanation why Mr. Williams would be so interested in a claim in which he had no financial interest. Mr. Bynum never discussed the Claim with his financial advisor and did not ask Mr. Williams any follow-up questions about this parade of red flags. That was more than sufficient for a reasonable juror to conclude that Mr. Bynum either knew or consciously avoided knowing that the Claim included false statements.¹³ See Khalupsky, 5. F.4th at 297 (concluding that there was a factual predicate for a conscious avoidance instruction because the defendant “chose not to confirm” the “reasonable” suspicion that documents had been illicitly obtained); Lewis, 545 F. App’x at 12 (same because the defendant “never read” the fraudulent papers she filed even though she had “reason to question” their veracity); Svoboda, 347 F.3d at 480-81 (same because the defendant’s source of financial trading information, the timing of trades, and trade returns, were “suspicious”).¹⁴ Mr. Bynum asserts that this case resembles United States v. Mankani, 738 F.2d 538 (2d Cir. 1984), in which the Second Circuit concluded that the evidence was insufficient to sustain a narcotics conspiracy conviction. See Def. Mem. at 6; Def. Reply Mem., Dkt. 1245, at 1-2. In that case, however, the Government argued that the defendant consciously avoided participating in the conspiracy, not that he consciously avoided knowing its illegal objective. Id. at 547; see also United States v. Scotti, 47 F.3d 1237, 1242-43 (2d Cir. 1995) (explaining that Mankani held that a conscious avoidance instruction is inappropriate “on the fact issue of knowing participation in a conspiracy” and did not preclude the charge with respect to knowledge of the conspiracy’s object). For all of these reasons, the conscious avoidance charge was warranted. CONCLUSION For the foregoing reasons, Mr. Bynum’s motion for acquittal or a new trial is DENIED. Mr. Bynum’s sentencing date remains Tuesday, March 12, 2024, at 2:30 P.M. Pre-sentencing submissions remain due on Tuesday, February 27, 2024. The Clerk of Court is respectfully directed to close the open motion at Docket Entry 1182. SO ORDERED. Dated: January 16, 2024