Philanthropist Philip Esformes attends the 15th Annual Harold & Carole Pump Foundation Gala at the Hyatt Regency Century Plaza on August 7, 2015 in Century City, California.,
Tiffany Rose | Getty Images
A Florida nursing home owner whose 20-year sentence over a $1.3 billion Medicare fraud scheme was commuted by then-President Donald Trump in late 2020 has lost an appeal in federal court and now appears to be on the way to one To be retrial on six healthcare criminal charges that a jury had previously deadlocked.
Philip Esformes had appealed his convictions for fraud, money laundering and receiving illegal kickbacks, calling for the charges against him on prosecutorial misconduct and other charges to be dismissed.
When indictments were filed against him and two others in 2016, the US Department of Justice called it the “largest criminal healthcare fraud case ever brought against individuals” in the Department’s history.
A three-judge panel of the US Circuit Court of Appeals for the 11th Circuit unanimously dismissed Esformes’ appeal in a ruling earlier this month.
The decision leaves him on the hook for $44 million in fines and forfeitures related to his conviction.
Esformes’ attorneys have indicated that they intend to request a rehearing of her appeal by the full line of 11th Circuit judges.
But such requests almost always face long odds against success.
The same panel also said it had no jurisdiction to address Esformes’ argument that Trump’s clemency, which freed him from prison, prevented prosecutors from trying him again on at least one of the six counts that the jury failed to reach a verdict liked at his trial.
Esformes’ lawyers had argued that a new trial would violate Trump’s clemency plea and the double jeopardy clause.
The Appellate Body said in its decision, “We cannot reach the merits of this argument because the Hung counts were not the basis for a final verdict.”
“With limited exceptions not relevant here, we only review final judgments,” the panel wrote.
There is no federal law specifically stating that prosecutors cannot retrial a defendant on counts on which the jury has deadlocked after a president commutes his sentence on other counts on which he was convicted. There is also no federal case law addressing this issue.
If Esformes is convicted in a retrial in a South Florida federal court, it’s likely his attorneys will reiterate their argument on appeal that a retrial was barred by Trump’s clemency.
Esformes’ attorney Kim Watterson said in a statement to CNBC, “The Court of Appeals has not ruled on the issue of whether President Trump’s pardon for Philip Esformes precludes further prosecution in any respect.”
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“Rather, the court has determined that it does not have the requisite jurisdiction — as a court of appeals — at this time to rule on the clemency argument and expressly stated that it failed to reach the merits of the argument,” Watterson said.
Esformes’ efforts to have his case dismissed were aided by a group of former Republican US attorneys general, including Edmund Meese, John Ashcroft, Michael Mukasey and Alberto Gonzalez, and Louis Freeh, a former FBI director and federal judge.
That group said prosecutors in the Esformes case broke rules that prevented them from using communications between defendants and their lawyers.
In its verdict, the Court of Appeal noted that prosecutors “were not just examining privileged documents
but also tried to use them twice against Esformes before the trial.”
And the panel also said a lower court judge had found prosecutors engaged in wrongdoing, as well as a “bad faith” attempt to cover up that conduct.
However, the appellate panel found that this judge and a federal district court judge “denied Esformes’ motion to dismiss the charges or disqualify members of the prosecution team.”
The panel said it agreed with the prosecutors’ arguments on appeal that Esformes “failed to demonstrate ‘provable bias’ based on the interference with his privacy” in communications with attorneys.
“Therefore, dismissing the charges or disqualifying the prosecution team would have been inappropriate,” the panel said.
Esformes, who was in jail at the time, was one of dozens of people to receive pardons from Trump in his final months in office.
The Justice Department said Esformes’ fraud scheme spanned two decades and resulted in an estimated $1.3 billion in losses as a result of fraudulent claims against Medicare and Medicaid.
With the proceeds from that program, Esformes bought a $1.6 million Ferrari Apera, a $360,000 Greubel Forsey watch and also paid for female escorts, the indictment said.
Prosecutors also said Esformes paid $300,000 in bribes to Jerome Allen, who at the time was a men’s basketball coach at the University of Pennsylvania and helped get Esformes’ son admitted to the university’s prestigious Wharton School of Business was by falsely claiming he was an esteemed basketball recruit.
When Esformes was convicted at his 2019 trial on 20 counts he faced, an FBI agent in charge of the Miami field office said he was “a man driven by almost limitless greed.”
“Esformes drove patients in poor condition through its facilities where they received inadequate or unnecessary treatment, and then misbilled Medicare and Medicaid,” the agent said.
“By continuing his despicable behavior, he bribed doctors and regulators to fuel his criminal behavior,” the agent said.
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