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United States v. Mbadugha

United States District Court, S.D. Texas, Houston Division

April 10, 2017

UNITED STATES OF AMERICA, Plaintiff-Respondent,
v.
LORETTA MBADUGHA, Defendant-Movant Criminal Action No. H-16-3227

          MEMORANDUM AND RECOMMENDATION

          FRANCES H. STACY UNITED STATES MAGISTRATE JUDGE.

         Before the Magistrate Judge in this federal habeas corpus proceeding pursuant to 28 U.S.C. §2255 is Movant Loretta Mbadugha's §2255 Motion to Vacate, Set Aside or Correct Sentence (Document No.199), [1] the United States' Motion to Dismiss (Document No.201), and Amended Motion to Dismiss (Document No.203). After reviewing the parties' submissions, the record of the proceedings before the District Court in the underlying criminal case, and the applicable case law, the Magistrate Judge RECOMMENDS, for the reasons set forth below, that the Government's Motion to Dismiss (Document No. 201) and Amended Motion to Dismiss (Document No. 203) be GRANTED, and that Movant's § 2255 Motion to Vacate, Set Aside or Correct Sentence (Document No. 199) be DENIED.

         I. Procedural History

         Movant Loretta Mbadugha ("Mbadugha"), who is currently in the custody of the United States Bureau of Prisons, is seeking federal habeas corpus relief under 28 U.S.C. §2255. This is Mbadugha's first attempt at §2255 relief.

         On March 19, 2014, Mbadugha along with Augustine Olisa Chui Egbunike, M.D., Charles Harris, Stella Ucheoma Akwarandu were charged in a fourteen count Indictment. Mbadugha was charged with conspiracy to commit health care fraud in violation of 18 U.S.C. § 1349 (Count one) and heath care fraud, aiding and abetting, in violation of 18 U.S.C. §§ 1347 and 2. (Counts eight to fourteen). (Document No. 1). On December 12, 2014, Mbadugha pleaded guilty to Count one, pursuant to a written plea agreement. (Document No. 101). Pursuant to the written Plea Agreement, Mbadugha agreed to plead guilty to conspiracy to commit heath care fraud. As to Mbadugha's right to appeal, both directly and collaterally, the Plea Agreement states in pertinent part:

7. Defendant is aware that Title 28, United States Code, § 1291, and Title 18, United States Code, § 3742, afford a defendant the right to appeal the conviction and sentence imposed. Defendant knowingly and voluntarily waives the right to appeal the conviction and sentence imposed, or the manner in which the sentence was determined. Additionally, Defendant is aware that Title 28, United States Code, § 2255, affords the right to contest or "collaterally attack" a conviction or sentence after the conviction or sentence has become final. Defendant knowingly and voluntarily waives the right to appeal or "collaterally attack" the a conviction or sentence after the conviction or sentence has become final. Defendant knowingly and voluntarily waives the right to appeal or "collaterally attack" the conviction and sentence, except that Defendant does not waive the right to raise a claim of ineffective assistance of counsel on direct appeal, if otherwise permitted, or on collateral review in a motion under Title 28, United States Code, section 2255. In the event Defendant files a notice of appeal following the imposition of the sentence or later collaterally attacks her conviction or sentence, the United States will assert its rights under this agreement and seek specific performance of these waivers.

         With respect to the factual basis, the Plea Agreement states in pertinent part:

15. Defendant is pleading guilty because she is guilty of the charges contained in Count 1 of the Indictment. If this case were to proceed to trial, the United States could prove each element of the offense beyond a reasonable doubt. The following facts, among others would be offered to establish Defendant's guilt:
16. Beginning in 2008 and through 2010, Defendant Mbadugha, doing business as Bayou Rehab and Family Service, Inc., located in Houston, Texas, in the Southern District of Texas, knowingly, intentionally and willfully engaged in a healthcare fraud conspiracy with Defendant Charles Harris and Defendant Dr. Augustine Egbunike, as well as other individuals.
17. Defendant Egbunike, licensed as a physician in Texas, allowed his Medicare and Medicaid provider number to be billed upon fraudulently by Mbadugha when in fact the services billed for were either medically unnecessary, not performed, or performed by medically unlicensed individuals.
18. Defendant Mbadugha routinely caused Medicare and medicaid to be repetitively billed for various types of diagnostic vestibular testing on Medicare and Medicaid patients, using the same six to seven diagnostic testing codes for all patients.
19. Defendant Mbadugha would send "superbills" to Egbunike's biller, C.S., who would enter the vestibular claim information using Egbunike's provider number. The Bayou superbill was [] preprinted with the seven vestibular codes, and contained hand-written notes showing the dates of service for each alleged vestibular test, along with the patient's name, address, date of birth and Medicare beneficiary number. This was all the information needed to bill.
20. Defendant Mbadugha sent her employees, who were not licensed physical therapists or licensed audiologists, usually into patients' homes, to perform some form of rudimentary vestibular testing and/or "balance training." Medicare and Medicaid require physical therapy and vestibular testing to be supervised by licensed physician or performed by a licensed physical therapist or licensed audiologists, or the claim will not be paid. ' 21. Regarding Medicare Patient L.B., on or about June 2, 2009, Defendants Egbunike and Mbadugha caused Medicare to be billed under six codes for diagnostic vestibular testing for L.B. that was not provided, not medically necessary and/or performed by unlicensed, unsupervised persons. Patient L.B. lived in a group home during the time frame of the indictment, suffered from seizures, was in a wheelchair and was blind. Because L.B. was blind, many of the diagnostic tests which measure eye movement with moving dots would have been impossible to perform. Defendant Egbunike had a patient file on L.B. showing an initial assessment of L.B.'s medical condition.
22. From on or about November 17, 2008 through on or about August 25, 2009, Defendants Mbadugha and Ebunike, and others known and unknown to the Grand Jury, caused to be submitted to Medicare on approximately 72 different dates of service using seven vestibular diagnostic codes for patient L.B., for a total billed amount of $34, 800.00 with $21, 847.30 being paid to Defendant Egbunike. In all, 905 vestibular diagnostic tests were billed to Medicare for patient L.B. These tests were either or not medically necessary, not performed as billed, or performed by an untrained, medically unlicensed individual.
23. Defendant Mbadugha routinely met with Defendant Egbunike to receive her testing payments sent to Defendant Egbunike by Medicare. Defendant Egbunike wrote checks drawn on his Wells Fargo account x3367-where the Medicare funds were ...

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