The Anti-Kickback Statute (“AKS”) is a federal law prohibiting people from referring or accepting the referral of patients covered by a federal healthcare program in exchange for a payment. 42 U.S.C. § 1320a–7b. This statute was allegedly violated by John Holland, William Moore, and Ed Cota. Cota and his wife Tracey ran a set of clinics for Hispanic women and children, which the parties call Clinica. Holland and Moore, meanwhile, were hospital executives for Tenet Healthcare. Holland and Moore allegedly increased the number of childbirths at Tenet hospitals by paying the Cotas to refer Medicaid or Medicare-covered pregnant women to the hospitals. The payments, the government says, came in the form of contracts to hire the Cotas to provide translation services for the women that they referred.
The district court concluded that the government needed to show that the participants in this scheme willfully violated the AKS. And the district court believed willfulness required knowledge of illegality. Because the district court found that the government did not prove knowledge of illegality, and thus willfulness, to its satisfaction at the paper hearing, the district court reasoned that the government had not proven the existence of an illegal AKS conspiracy. And without an illegal conspiracy, the district court held that it could not admit coconspirator statements under the coconspirator exclusion from the hearsay rule. The government appealed the district court’s decision.
The United States Court of Appeals for the Eleventh Circuit stated in its September 24, 2024 published Opinion : “Generally, hearsay is not admissible. Fed. R. Evid. 802. Excluded from the definition of hearsay, though, are out-of-court statements offered against an opposing party that the opposing party made. See Fed. R. Evid. 801(d)(2). That hearsay exclusion also covers statements made by an opposing party’s surrogate, including: (A) statements “made by the party in an individual or representative capacity,” (B) statements “the party manifested that it adopted or believed to be true,” (C) statements made by someone “whom the party authorized to make a statement on the subject,” (D) statements “made by the party’s agent or employee on a matter within the scope of that relationship and while it existed,” and (E) statements “made by the party’s coconspirator during and in furtherance of the conspiracy.”
With regard to the coconspirator exclusion, the federal appellate court stated: “The word “conspiracy” as used in the rule can refer to either (1) an agreement to do something unlawful or (2) the act of working together toward a shared goal (i.e., a joint venture) … The defendants argue that the first definition applies, and the government argues that the
second governs. We agree with the government. The Supreme Court’s precedent and our own both suggest that the word “conspiracy” in Rule 801(d)(2)(E) means an arrangement to work together toward a shared goal. That definition is also supported by our sister circuits, leading treatises, and the text of the rule … the defendants argue that the coconspirator exclusion requires that a conspiracy be unlawful. That proposition, the defendants say, is supported by several authorities. We disagree … Rule 801(d)(2), which contains the coconspirator exclusion, has nothing to do with illegality. It excludes opposing party statements from the hearsay rule … when the Rules of Evidence apply differently to allegations of criminal activity, they expressly say so.”
The federal appellate court held: “The relevant question the district court should have asked is whether the out-of-court statements are offered against an opposing party and were made during and in furtherance of a joint venture with that party. On remand, the district court should apply that standard to the statements at issue to determine their admissibility under Rule 801(d)(2)(E).”
Source United States of America v. Holland, No. 22-14219.
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