Sentencing Insights From A Chat With Judge Nancy Gertner

Featured, Nancy Gertner Articles

By Alan Ellis |law360.com | February 2, 2020

In 1983, I asked the incoming president of the National Association of Criminal Defense Lawyers, the late Robert W. Richie of Knoxville, Tennessee, if I might chair a new committee that I was discussing with past president Gerald Goldstein, then of San Antonio, Texas, and now of Aspen, Colorado. Its task would be to represent and counsel criminal defense lawyers who were imperiled with risk of contempt, disqualification, subpoena or bar grievance arising out of their vigorous and ethical defense of their clients. It was to be called the NACDL Lawyers Assistance Strike Force.

The first client of the Strike Force was Nancy Gertner, then a prominent lawyer in Boston. Gertner and her co-counsel had been subpoenaed on the eve of trial in the U.S. District Court for the District of New Hampshire to turn over fee records from certain clients in order to show that if clients could afford top-notch lawyers, they couldn’t possibly be menial workers. (Gertner’s client was a parking attendant but had the funds to retain her.)

I flew to New Hampshire and testified on behalf of the NACDL Strike Force, which resulted in the judge’s quashing the subpoenas:

The use of the phrase chilling affect upon the role of an attorney engaged in criminal defense work by being served a subpoena in circumstances such as this is mild. To permit it would have an arctic effect with the non-salutary purpose of freezing criminal defense attorneys into inanimate ice floes, bereft of the succor of constitutional safeguards.

The monetary problems such as attorneys hiring attorneys (as we have in this case) can be better spent on pertinent matters (a lawyer’s time is his stock-in-trade). Also to be considered is the ever increasing specter of malpractice suits, the possible vindictiveness of prosecution counsel towards a successful, recalcitrant, obnoxious or obfuscating adversary, the jeopardizing of the attorney-client relationship, real or imaginary, the reluctance of capable attorneys to continue or to consider a full or partial career in the practice of criminal law and the further depletion in the paucity of capable trial lawyers because of a concatenation of events leading to abuse of process.[1]

The district court quashed the subpoenas, emphasizing the negative effect that it believed the subpoenas would have on the attorneys’ ability to defend their clients in the pending state criminal action. The court expressed concern that forced disclosure would jeopardize the attorney-client relationship at a crucial point in the defense preparation. The could also found that “[t]he actions of the U.S. Attorney are without doubt harassing” and noted that enforcement of the subpoenas in this context would deter attorneys from following a career in criminal law because of the personal and professional traumas resulting from the United States attorney’s investigatory tactics.

The government appealed, but the U.S. Court of Appeals for the First Circuit affirmed the decision.[2]

Gertner subsequently was nominated by President Bill Clinton to the U.S. District Court for the District of Massachusetts. Her nomination was strongly supported by the late Sen. Edward Kennedy, D-Mass. She served until 2011, during which time she issued numerous opinions on sentencing issues and was widely published in the area. She currently is a senior lecturer on law at Harvard Law School, where she teaches forensic science and sentencing. She is also writing a book titled “Incomplete Sentences: Gangs, Guidelines and Judges,” which is expected to be published by Beacon Press this year.

In the first of a few interviews with Judge Gertner, which took place between August and November of last year, I began by asking her why she resigned from the bench. She gave me several reasons, most of which boiled down to her frustration with the U.S. Sentencing Commission’s refusal to take any of her opinions into consideration when reworking the federal sentencing guidelines. She thought she could better contribute to ending mass incarceration by teaching law students, lawyers and federal judges at the Federal Judicial Center on sentencing. She has spoken at several NACDL continuing legal education programs, including the recent white collar program in Washington, D.C., in October 2019.

Following one of her presentations at an NACDL CLE program soon after she took the bench, I asked her what a lawyer can do when he has a serious drug client with a lengthy criminal record who was dealing significant amounts to inner city youths. “Tell me a story,” was her response. “Every client has a story.”

Many of the 30 judges whom I’ve interviewed for my Law360 series “Views From the Bench on Sentencing Representation” thought there isn’t much a lawyer can do at the sentencing hearing. [3] The judges came out on the bench with a tentative sentence already in mind. If they “moved the needle,” it was usually based on the defendant’s allocution. Judge Gertner told me she thought differently:

Whenever you have an opportunity to speak, take advantage of it. Make the sentencing hearing a public ceremony. Bring in family, friends, and supportive victims and law enforcement to the hearing. Sympathetic media also. Allocution can be very important if not written by the lawyer. On the other hand, defense counsel has to be very careful about prepping his or her client for allocution and, at a minimum, hearing what he’s going to say. Allocution can be dangerous unless the defendant is prepped.

She agreed with me that an offender’s stepping up to the plate and owning their mistake and demonstrating sincere remorse was very important. Any effort made toward restitution was one example of demonstrative remorse and carried a lot of weight with her.

Asked how she viewed mental health and substance abuse issues, Judge Gertner said that an individual who sought treatment — particularly before he or she knew he or she was under investigation — often made a positive impression on her. Mental health evaluations could be especially important when they showed what the defendant had done to make up for his or her offense. If an offender ceased criminal conduct before realizing he or she was under investigation, this also could have a huge impact on Judge Gertner’s thinking in regard to sentencing.

She entertained and welcomed reasonable sentencing recommendations by defense counsel, particularly from a lawyer who had credibility with her. Since the prosecutors generally recommended guidelines sentences, their recommendations counted for less.

When I asked her to address the government’s argument that a significant sentence should be imposed as general deterrence to others, she answered that many defendants, particularly drug offenders and gang members, know they are going to go to prison if caught. Having a felony record for others, especially white collar offenders, can be as worrisome to them as a long prison sentence.

Having taught and written on neuroscience and the law, Judge Gertner values the opinions of mental health professionals, particularly the clinicians who have treated the defendant. She agreed with me that it is a good idea to summarize the experts’ report in your sentencing memorandum and then make the experts available to the judge for questions during the sentencing hearing.

Judge Gertner also considered community service performed prior to sentencing, giving special weight to such activity if it was tailored to the crime — for example, older gang members working to dissuade younger ones from criminal activities.

Judge Gertner said she typically began focusing on the sentence she might impose as soon as she received the presentence report and sentencing memoranda of the parties, generally a week in advance of the sentencing. “Presentence memoranda were very important to me if they presented the full picture of the client, warts and all,” she explained. But 18 U.S.C. §3553 is an empty vessel to her. “It’s a nothing burger. It needs to be filled in in the sentencing memorandum.”

Character letters can be important unless they appear to have been written by the lawyer. “You should quote from the better ones in your sentencing memorandum and attach them as an exhibit. Attach others that are good that you are not quoting as a separate exhibit.”

If there were significant guidelines issues to be decided, she appreciated counsel who gave her as much time as possible to research these and other issues raised by the parties. She considered a latefiled sentencing memorandum if something came up at the last minute, although often these are submitted by bad lawyers. Sentencing videos were “ok” if not too slick.

Early and frequent contact with the probation officer can lead to a positive presentence report, Judge Gertner noted:

The PSR needs to be a megaphone for the offender. The lawyer should find out as much as possible from the probation officer assigned to the case including whether the probation officer talks to the judge prior to sentencing. … Find out if the judge meets with the probation officer and/or follows their recommendations. Learn how the judge feels about the U.S. Probation Officer or the office in general.

In the end, as with most of the judges whom I’ve interviewed, the “why” question was critically important for Judge Gertner: “Why did your client do what he or she did? I wanted to know what is going on here.”

Indeed, this was one of the reasons Judge Gertner was so vocal an outspoken critic of the guidelines:

They didn’t take into account why an offender did what he did. For example, why was a drug dealer selling his drugs? Was he doing it to support his addiction? Was he doing it to buy school supplies? Was he doing it because he was living on the street and supporting his younger siblings? The guy who is essentially living high on the hog from drug trafficking is a different offender than the guy who is selling cocaine for school supplies. Also, if this guy had an opportunity to make a living wage, perhaps he wouldn’t have had to sell drugs if this guy had neurological damage. If this is your argument, you needed to give me evidence of these mitigating factors. You couldn’t just argue it.

I asked her another “why” question: How can defense counsel can endeavor to show a judge why the defendant is unlikely to reoffender. “I found it very helpful when lawyers gave me a plan for their client’s rehabilitation. It can be even better if the defendant has embarked on rehabilitation prior to sentencing.”

The ultraconservative Charles Koch Institute, on the criminal justice reform section of its website, states that, “Jail should be reserved for people who pose a threat to public safety.” In other words, we should be sending people to prison who we are afraid of, not that we are just pissed at.

Judge Gertner agreed and suggested that’s a good point to make to a sentencing judge.

For most judges, the key questions they want answered are:

  1. Why did your client do what he did?
  2. What has he done to own his mistake and demonstrate sincere remorse?
  3. Why was the behavior out of character with an otherwise law-abiding life if it was?
  4. Why is he unlikely to do it again?
  5. Why should I cut him a break?

For Judge Gertner, it appeared that the key questions she wanted answered were: Why did your client do what he did, and why is he unlikely to do it again?

© 2020, Portfolio Media, Inc.
Original article available at law360.com .
Reprinted with permission.

[1] In re Grand Jury Matters , 593 F.Supp. 105 (D.NH. 1984).

[2] In Re Grand Jury , 751 F.2d 13 (1st Cir. 1984).

[3] See also, “What Federal Judges Want to Know at Sentencing,” The Federal Lawyer (September 2017) https://alanellis.com/views-bench-mistake-demonstrate-sincere-remorse/ and “Own the Mistake and Demonstrate Sincere Remorse,” The Federal Lawyer (September/October 2019) https://alanellis.com/news/blog/sentencing-tips/.

Alan Ellis, a past president of the National Association of Criminal Defense Lawyers and Fulbright Award winner, is a criminal defense lawyer with offices in San Francisco and New York. He is the co-author of “Federal Prison Guidebook: Sentencing and Post Conviction Remedies.”

Corporate Crime Reporter: Reuben Guttman on the Failure of Corporate Compliance

Reuben Guttman Articles, Whistleblower Articles

Corporate Crime Reporter, Volume 34, Number 3, Monday, January 20, 2020

REUBEN GUTTMAN ON THE FAILURE OF CORPORATE COMPLIANCE

Internal corporate compliance programs do nothing to address pervasive wrongdoing central to a company’s business model.

That’s the take of Reuben Guttman of Guttman, Buschner & Brooks in Washington, D.C.

“This I know from 30 years plus of litigation against corporate wrongdoers,” Guttman says.

“WorldCom, Enron and Tyco all had on paper compliance programs that would impress the lay person and might impress somebody teaching at a law school. But the misconduct was ingrained into the business model,” Guttman told Corporate Crime Reporter in an interview last week.

“Where the conduct is pervasive and part of the business model, the internal compliance program is not going to correct it,” Guttman said. “I have litigated against Abbott Labs. The company engaged in pervasive misconduct with regard to the marketing of the anti-epileptic drug Depakote. It resulted in both civil and criminal sanctions against the company. It was a total $1.6 billion settlement.”

“What we found in the Depakote case was that the existence of the corporate compliance program assuaged insiders in the corporation so that they thought there could be no wrongdoing going on. It is like – I s_aw the doctor last week so I can’t possibly be sick when in fact you could be terminally ill.”

“Compliance programs in part are being used to assuage people and not make them second guess because they believe someone else is taking care of it.”

“When we first interviewed our original client in the Depakote case – is your company off label marketing the drug? And the answer was – no, we are not off label marketing the drug. We have an internal compliance program. Everything we do is legal. We are told everything we do has to be legal.”

“But when we started getting into the actual facts of how the drug was being marketed, we saw major problems. Internal compliance programs have the ability to convince people that there can be no wrong. We saw the same situation in GlaxoSmithKline involving a number of drugs. I think the False Claims Act settlement was $1 billion. We settled on the eve of trial against Celgene for $280 million.”

“And the sales people say – we do no wrong, we are a terrific company. I have written an article about this for the Safra Center for Ethics at Harvard Law School. It’s titled – Internal Compliance – Is It Really About Compliance?”

“Our niche as a law finn is challenging corporate conduct that is pervasive and intertwined with the business model of a corporation. The conduct is so central to the business model that if you take out the conduct, it will materially impact the value of the company. It’s shareholders will take notice.”

“Where you have conduct that is central to the business model, the compliance program won’t do much. Will it make people think more about compliance? Maybe it couldn’t hurt. But what makes people sit up and notice is the Sally Yates memo of September 2015. It says, when corporations get into trouble, we are going to be looking at individual liability. The reality is that corporations can’t do what they do absent the conduct of individuals. That is going to be the best way to enforce compliance.”

“I come from a labor background. Statutory labor law has been around for about 80 years. One of the things that is central to labor law is that company dominated unions are unlawful. If a company says – you don’t need a union, we have our own union, go join our union – that’s a violation of the National Labor Relations Act.”

“In many respects you have compliance programs that are analogous to company dominated unions. Instead of an outside entity doing the investigation and making transparent the wrongdoing, the internal compliance department is the first vacuum that sweeps up the information. And the corporation decides what they want to do
with it.”

“Sometimes the information that the whistleblower is reporting has significant impact not just within the corporation but to parties outside the corporation. For example, let’s say you have a drug that is being marketed for the wrong purposes, or a drug that has been adulterated, or a medical product that is problematic and the company doesn’t resolve the full results of tests.”

If compliance programs are not working, if it’s an internal police force controlled by the corporation, what do you propose? “I’m not suggesting eliminating internal corporate compliance. I’m suggesting you not rely on it as the panacea. Maybe it doesn’t hurt. But don’t count it as the solution. Recognize that it has a serious potential to be a mechanism to conceal wrongdoing.”

“I debated somebody a number of years ago on Bloomberg. We were discussing the SEC whistleblower program. And the question was – must you go to internal corporate compliance first before you go to the SEC?”

“The corporations, the Chamber of Commerce was saying – you must go to corporate internal compliance first before you go to the SEC. My perspective was – absolutely not. At the least, you should have a choice. You don’t know whether the corporation is going to make transparent the problems that may not only impact the bottom line for the shareholders, but may involve life saving devices for consumers or devices like automobiles that cause injury.”

“Look at the GM ignition switch case. Look at Boeing. Boeing is classic. Do you really want the 737 MAX to be something that is investigated by internal compliance, remains in internal compliance and never sees the light of day?”

A strong internal compliance program would find the problem, resolve the problem and report it to the government. But from your experience within the pharnrnceutical industry – “Not just the pharmaceutical industry. But look at GM and the ignition switch. Look at Boeing.

These programs just don’t work. If these programs were working, we wouldn’t be seeing the pervasive wrongdoing we are seeing. Internal compliance is not going to have the leverage within a corporation to say – we have to take the 73 7 M AXs out of the air. That’s a really tough call for a corporation to make. That’s why you need outside regulators. You shouldn’t be cutting the company slack because it has an internal compliance program.”

“In fact, if the company has an internal compliance program and you found that the company engaged in wrongdoing, it is worse, because it means the internal compliance program wasn’t working. It means it was worthless.”

Is there any evidence that the government corporate criminal enforcement program is deterring wrongdoing? “Based on the wrongdoing I’ve seen, no.”

“Each of the big phannaceutical frauds I have seen, the companies are paying amounts of money that cause the public to take notice. But in fact, what is going on is much of the litigation across the board is effectively setting a fee for a license to break the law.”

“The litigation is not having an impact. I don’t think the corporate compliance programs are having an impact. What will have an impact is sticking to the letter of the Sally Yates memo of September 2015.”

INTERVIEW WITH REUBEN GUTTMAN, GUTTMAN, BUSCHNER & BROOKS, WASHINGTON, D.C.

Internal corporate compliance programs do nothing to address pervasive wrongdoing central to a company’s business model.

That’s the take of Reuben Guttman of Guttman, Buschner & Brooks in Washington, D.C.

“This I know from 30 years plus of litigation against corporate wrongdoers,” Guttman says. We interviewed Guttman on January 13, 2020.

CCR: You graduated from Emory Law School in 1985. What have you been doing since?

GUTTMAN: I have been doing litigation against large corporations. Between 1985 and 1990, I was counsel to the Service Employees International Union.

I was the chief outside counsel to the Oil Chemical and Atomic Workers Union (OCA W). l represented OCA W in the nuclear weapons sector. I brought significant cases against the Department of Energy and environmental and safety and health issues.

I have had a corporate fraud practice under the False Claims Act and other statutes. I have been involved in cases against the major pharmaceutical companies – Pfizer, GlaxoSmithKline, Wyeth, Celgene, Abbott Labs. And collectively these cases have resulted in recoveries totaling $6 billion.

I have done lots of litigation under the Fair Labor Standards Act against the meatpacking industry involving meatpackers in the midwest.

Primarily my expertise is corporate fraud and mismanagement. I bring securities class actions based on breaches of fiduciary duties. I have litigated the issue of whether the Hershey Corporation had to make disclosures about records regarding its use of child labor in the Ivory Coast and Ghana.

I have had a pretty broad practice over 35 years. I have reinforced that through teaching at various law schools – including Rutgers and Emory.

I’m writing a book on pre-trial litigation which will be published by Walters Kluwer hopefully in the fall. My co-author is Jason Lore at Rutgers.

I do a regular blog for the National Institute of Trial Advocacy called The Rule of Law blog. I was on the board of directors of the American Constitution Society for six years – I’m now on the advisory board. It’s been 35 years of an eclectic practice.

CCR: What is the primary practice of your law firm?

GUTTMAN: It is complex litigation involving corporations.

CCR: Is your practice exclusively plaintiffs’ side?

GUTTMAN: Yes.

CCR: What percentage of your practice is False Claims Act?

GUTTMAN: Seventy percent.

CCR: Other than False Claims Act, what kind of cases do you bring?

GUTTMAN: We have a large class action under ERISA against the mortgage servicers. It’s a novel theory. The court has sustained our complaint. I’m sitting in South Carolina now.

We are settling a civil rights class action against the South Carolina prison system. The settlement will require the treatment of thousands of prisoners for Hepatitis C. It has partially settled already. It requires the state to test prisoners.

We are involved in derivative litigation in Delaware.

CCR: You are primarily a False Claims Act firm.

GUTTMAN: We actually litigate non-intervene cases. For Celgene, we settled on the eve of trial. We took tons of depositions. We are trial lawyers. We are not lawyers who put the case in play hoping the government will settle.

Right now we are suing Massachusetts General Hospital in a non intervene case. We are litigating against a urologist in New York City in a nonintervene case. We settled the intervene portion of it for $12.3 million in November.

We are always in discovery, we are always taking depositions.

CCR: Are you saying that the majority of your False Claims Act cases are non-intervene cases?

GUTTMAN: A decent percentage of them. We litigate more False Claims Act cases than anybody else in the country. That’s just my perspective.

CCR: How many False Claims Act cases do you have going at any one time?

GUTTMAN: We get anywhere between 500 and 1,000 knocks on the door a year. We will cull that down to four, five or six False Claims Act cases that we take a year.

We vet these cases so heavily that by the time they get to the government, the government is looking at a case that is strong on the merits.

CCR: You have a strong filter. Do you know pretty much know within the first couple of minutes of talking with a whistleblower whether or not it’s going to be a case for your or not?

GUTTMAN: We can tell from the first twenty or thirty minutes. Let me give you an anecdote. A number of years ago I had a case against Abbott Labs.

The case settled for $1.6 billion. 1 asked the government lawyer a little while after the case settled – when did you realize it was a good case? And the government lawyer said – about 30 minutes into the client interview. We can pretty much tell up front whether it has some heft, whether it’s a case that we are going to dig into and investigate. There are ways to eliminate cases quickly.

CCR: How many cases are you carrying at any one time?

GUTTMAN: Dozens.

CCR: How many cases do you settle a year?

GUTTMAN: In the last five years, we have been resolving four or five cases a year.

CCR: We posted a story on Twitter from the Wall Street Journal about an interview with a Justice Department official, Matt Miner. He was talking about how internal compliance programs can help prevent corporate crimes. You went onto our Twitter feed and wrote – “Internal compliance programs do nothing to address pervasive wrongdoing central to a company’s business model, as in Enron, Tyco and WorldCom. This I know from 30 years plus of litigation against corporate wrongdoers.”

I read that to Duke Law Professor Sam Buell. He told us this – “This guy is saying – I’ve seen companies spend lots of money on compliance and it didn’t make a difference because they were thoroughly corrupt and everyone in the company didn’t care about compliance. But other people will say- I’ve seen companies with good compliance who generally stayed away from enforcement actions. Or I’ve seen companies with bad compliance but they got better; and their problems with the government decreased. Everyone is talking anecdotes. Companies are enormously complex. They are the most complicated things we have in our society. They become extremely difficult to study empirically.”

GUTTMAN: I was at Milberg Weiss and Grant & Eisenhofer. At Milberg, we were part of the Enron litigation. Milberg was also part of the Worldcom litigation.

When I was at Grant & Eisenhofer, they were part of the Tyco litigation. WorldCom, Enron and Tyco all had on paper compliance programs that would impress the lay person and might impress somebody teaching at a law school. But the misconduct was ingrained into the business model.

Where the conduct is pervasive and part of the business model, the internal compliance program is not going to correct it. I have litigated against Abbott Labs.

The company engaged in pervasive misconduct with regard to the marketing of the anti-epileptic drug Depakote. lt resulted in both civil and criminal sanctions against the company. It was a total $1.6 billion settlement.

What we found in the Depakote case was that the existence of the corporate compliance program assuaged insiders in the corporation so that they thought there could be no wrongdoing going on. It is like – I saw the doctor last week so I can’t possibly be sick when in fact you could be terminally ill. Compliance programs in part are being used to 14 CORPORATE CRIME REPORTER MONDAY JANUARY 20, 2020 assuage people and not make them second guess because they believe someone else is taking care of it.

When we first interviewed our original client in the Depakote case – is your company off label marketing the drug? And the answer was – no, we are not off label marketing the drug. We have an internal compliance program. Everything we do is legal. We are told everything we do has to be legal. But when we started getting into the actual facts of how the drug was being marketed, we saw major problems. Internal compliance programs have the ability to convince people that there can be no wrong. We saw the same situation in GlaxoSmithKline involving a number of drugs. I think the False Claims Act settlement was $1 billion. We settled on the eve of trial against Celgene for $280 million.

And the sales people say – we do no wrong, we are a terrific company. I have written an article about this for the Safra Center for Ethics at Harvard Law School. It’s titled – Internal Compliance – Is It Really About Compliance?

Our niche as a law firm is challenging corporate conduct that is pervasive and intertwined with the business model of a corporation. The conduct is so central to the business model that if you take out the conduct, it will materially impact the value of the company. It’s shareholders will take notice. Where you have conduct that is central to the business model, the compliance program won’t do much. Will it make people think more about compliance?

Maybe it couldn’t hurt. But what makes people sit up and notice is the Sally Yates memo of September 2015.

It says, when corporations get into trouble, we are going to be looking at individual liability. The reality is that corporations can’t do what they do absent the conduct of individuals. That is going to be the best way to enforce compliance. 1 come from a labor background. Statutory labor law has been around for about 80 years. One of the things that is central to labor law is that company dominated unions are unlawful.

If a company says – you don’t need a union, we have our own union, go join our union – that’s a violation of the National Labor Relations Act. In many respects you have compliance programs that are analogous to company dominated unions.

Instead of an outside entity doing the investigation and making transparent the wrongdoing, the internal compliance department is the first vacuum that sweeps up the information. And the corporation decides what they want to do with it.

Sometimes the information that the whistleblower is reporting has significant impact not just within the corporation but to parties outside the corporation.

For example, let’s say you have a drug that is being marketed for the wrong purposes, or a drug that has been adulterated, or a medical product that is problematic and the company doesn’t resolve the full results of tests.

We are now suing Massachusetts General Hospital for overlapping surgeries. The allegations are that they completely overlapped.

CCR: What do you mean by overlapped?

GUTTMAN: In the orthopedic area, you book patients whose~urgeries overlap. The surgeon is running from one surgery to another. We just settled such a case against another hospital in New York City. It’s a Medicare fraud case.

CCR: If compliance programs are not working, if it’s an internal police force controlled by the corporation, what do you propose?

GUTTMAN: I’m not suggesting eliminating internal corporate compliance. I’m suggesting you not rely on it as the panacea. Maybe it doesn’t hurt. But don’t count it as the solution. Recognize that it has a serious potential to be a mechanism to conceal wrongdoing.

I debated somebody a number of years ago on Bloomberg. We were discussing the SEC whistleblower program. And the question was – must you go to internal corporate compliance first before you go to the SEC?

The corporations, the Chamber of Commerce was saying – you must go to corporate internal compliance first before you go to the SEC. My perspective was – absolutely not.

At the least you should have a choice. You don’t know whether the corporation is going to make transparent the problems that may not only impact the bottom line for the shareholders, but may involve life saving devices for consumers or devices like automobiles that cause injury.

Look at the GM ignition switch case. Look at Boeing. Boeing is classic. Do you really want the 737 MAX to be something that is investigated by internal compliance, remains in internal compliance and never sees the light of day?

CCR: A strong internal compliance program would find the problem, resolve the problem and report it to the government. But from your experience within the pharmaceutical industry –

GUTTMAN: Not just the pharmaceutical industry. But look at GM and the ignition switch. Look at Boeing. These programs just don’t work. If these programs were working, we wouldn’t be seeing the pervasive wrongdoing we are seeing. Internal compliance is not going to have the leverage within a corporation to say- we have to take the 737 MAXs out of the air. That’s a really tough call for a corporation to make. That’s why you need outside regulators. You shouldn’t be cutting the company slack because it has an internal compliance program.

In fact, if the company has an internal compliance program and you found that the company engaged in wrongdoing, it is worse, because it means the internal compliance program wasn’t working. It means it was worthless.

CCR: Is there any evidence that the government corporate criminal enforcement program is detening wrongdoing?

GUTTMAN: Based on the wrongdoing I’ve seen, no.

Each of the big pharmaceutical frauds I have seen, the companies are paying amounts of money that cause the public to take notice. But in fact, what is going on is much of the litigation across the board is effectively setting a fee for a license to break the law.

The litigation is not having an impact. I don’t think the corporate compliance programs are having an impact.

What will have an impact is sticking to the letter of the Sally Yates memo of September 2015.

CCR: Of your practice, what part of the False Claims Act cases are FCPA or Medicare fraud or other?

GUTTMAN: There is overlap. You could have a situation where a company is unlawfully marketing a drug. And they are not making that disclosure to the public. In a large pharmaceutical fraud case, you are going to have a securities component. We have been involved in a number ofFCPA cases.

CCR: Has the plaintiffs bar moved over the years from primarily class actions to primarily False Claims Act cases now?

GUTTMAN: It’s a complicated question. Elizabeth Burch is a professor of law at the University of Georgia. She has just published a book titled Mass Torts. It would be worth interviewing her on this.

In 1965, Ralph Nader published Unsafe at Any Speed. Before that book, people thought – if you got into a car accident, it was your fault. Nader made people think – it could be a defect in the automobile. He was the impetus for plaintiffs’ class
actions.

In 1968, Congress passed the multi-district litigation (MDL) statute. The courts needed to figure out how to address the 3,000 price fixing cases in the electrical transmission industry. There was an informal mechanism to do that. And that was codified in 1968.

With the rise of the class actions, the defense bar organized and made it harder to certify a class action. I’m actually arguing a class action certification case tomorrow, so it’s on my mind.

By the 1990s, you had two Supreme Court asbestos cases. And with those cases, the Supreme Court made it more difficult to certify class actions. Because cases were not being certified, you had all of these mass tort cases being brought as individual cases. Lawyers on both sides sought to use the MDL process.

It’s not that people are moving into false claims as much as people are moving into these MDL mass tort cases.

Of course, some product liability attorneys want to get into the false claims area. But the reality is that the false claims bar, to some degree, is the impetus for a lot of these cases. We bring the big pharma false claims cases and other cases follow.

Another thing that has been happening is that the courts have been cracking down on access to the courts. The pleading standards have been toughened.

When I got out of law school, there was something called notice pleading. As long as you put the other side on notice about what the case was about, that was enough.

In 2007 or 2008, the Supreme Court came down with a couple of cases requiring the pleading of facts. You can’t just plead conclusions. If you plead conclusions, the court will strip out the conclusion. And then the court will apply a plausibility standard.

And a judge will look at a case and say – is this case plausible? In a false claims case, you have to plead fraud with particularity or specificity. These cases are front loaded in the sense that you have to do the investigation up front. You have to prove a case that the government thinks is a good case – not a case you think is a good case. All of those are filters that whittle down access.

CCR: There is a public debate over the role of the trial lawyer in society. A case can be made that big business has defeated the trial lawyers in the court of public opinion. Why did that happen?

GUTTMAN: I don’t think they have won the debate. Everything we have in this country that makes us safer is the result of transparency in the court system – the trial lawyers.

The trial lawyers brought us Brown v. Board of Education. The trial lawyers brought us Loving v. Virginia – the right to marry who you want to marry without regard to race.

The trial lawyers brought us safer automobiles, seat belts. They exposed the dangers of lead paint. The trial lawyers brought us safer food. We can live safer healthier lives because of trial lawyers.

CCR: You are making the argument. But regular people don’t like trial lawyers.

GUTTMAN: I haven’t done polling. I’m going to court tomorrow morning. I try cases. I have a comfort level because I know I’m saving people’s lives tomorrow morning when I am going to get Hepatitis treatment for thousands of pnsoners.

The state of South Carolina prison system is going to be testing 20,000 people and treating them. I know I’m having an impact.

I have brought cases that have saved people from drugs that are harmful to them. Maybe trial lawyers are not getting the message out. I teach and have a broader public policy perspective.

I try to take cases that have a broader impact. I want to leave the world a better place. I went to law school so that I could do things that make the world a better place.

Contact: Reuben Guttman, Guttman, Buschner & Brooks, Embassy Row District, 1509 22nd Street NW, Washington, D.C. 20037. Phone: 202.800.3001. Email: rguttman@gbblegal.com

Reuben Guttman Represents Whistleblowers in $12.3 Million Settlement

Reuben Guttman Articles

Congratulations are in order for NITA faculty member and author Reuben Guttman, who successfully represented whistleblowers and the federal government in a False Claims Act filing against a Boston teaching hospital for allowing its urology department chair to book simultaneous surgeries and for billing Medicare for procedures performed by his unsupervised medical residents. Reuben, a founding member of the D.C. law firm of Guttman, Buschner & Brooks PLLC, was part of the legal team that negotiated a $12.3 million settlement for the whistleblowers.

The case involved Dr. David Samadi, a “celebrity urologist” specializing in robotic prostate surgeries. The high volume of Dr. Samadi’s procedures at Northwell Health of New York’s teaching facilities was the subject of 2017 investigation by the Boston Globe, which spurred whistleblowers to file lawsuits against the surgeon and hospital.

In a comment to The Legal Advocate, Reuben remarked, “If you think about FRE 401 as not distinguishing between direct and circumstantial evidence, the task of putting together a complex fraud case like this one is less daunting. These cases are just like a 500-piece jigsaw puzzle where you don’t have the picture on the cover of the box to guide you but do have an evolving theory for guidance.”

Reuben serves as faculty at NITA deposition programs in Seattle and Atlanta and trial skills programs in D.C. He is co-author of the United States ex rel. Rodriguez v. Hughes, et al. case files, which involve a whistleblower in the defense industry. Reuben and co-author J.C. Lore are currently writing Pretrial Advocacy, a new textbook that will be published by NITA in late 2020.

Source: https://www.nita.org/blogs/reuben-guttman-represents-whistleblowers

NY Healthcare Network Pays $12.3 Mill. To Settle Claims Alleging False Medicare Billing

Elizabeth Shofner, Justin Brooks Articles, Nancy Gertner Articles, Reuben Guttman Articles, Traci Buschner Articles, Whistleblower News

As a result of a lawsuit brought under the Federal False Claims Act by three whistleblowers, one of the New York area’s largest healthcare providers – Northwell Health, Inc. whose subsidiary includes Lenox Hill Hospital —  has agreed to pay $12.3 million to resolve claims that it engaged in false or fraudulent billing to the Federal Medicare system.

Northwell operates 23 hospitals and 700 outpatient centers.

The settlement covers three alleged schemes involving Urologist David B. Samadi: that (1) Northwell over-compensated Samadi in order to secure hospital referrals in alleged violation of the Physician Self-Referral Law (the “Stark Act”), (2) Northwell billed Medicare for surgeries where Samadi violated billing procedures governing overlapping surgeries, and (3) Northwell billed for procedures that were not medically necessary to perform in an operating room.

The Physician Self-Referral Law, 42 U.S.C. §1395nn, prohibits physicians from referring patients to receive “designated health services” payable by Medicare or Medicaid from entities with which the physician or an immediate family member has a financial relationship, unless an exception applies.

According to a settlement agreement executed in United States of America ex rel. George Markelson, et. al. v. David B. Samadi, M.D.  and Northwell Health, Inc. et al., “Defendants’ practices resulted in the submission of several million dollars of inappropriate claims to Medicare.”

The settlement also states that, “when portions of an endoscopic surgery in OR 21 overlapped with a surgery in OR 25, Samadi was not present in OR 21 throughout the entire period of time the scope was inserted to the time the scope was removed.” The settlement agreement also states that, “Samadi would freeze or pause the robotic equipment in OR 25 and leave the patient under the care of the anesthesiologist, operating room staff, and, in some instances, a urology resident.”

Relators were represented by the Jacob D. Fuchsberg Law Firm, LLP, and by Guttman, Buschner & Brooks, PLLC. The Jacob D. Fuchsberg Law Firm, LLP, is a prominent medical malpractice firm and Guttman, Buchner & Brooks, PLLC, is a nationally recognized firm engaging in complex litigation and representing whistleblowers under the Federal False Claims Act and state false claims statutes.

“We exposed medical malpractice designed to inflate surgical volume, revenue, profit, and compensation and conduct that tramples on patient rights, abuses confidence in healthcare, corrupts graduate medical education, and violates the law,” said Joseph Lanni of the Jacob D. Fuchsberg Law Firm, LLP.

“While this case was filed and resolved as a matter of false or fraudulent billing to the Medicare system, in reality it was about the egregious monetization of human maladies which is all too common in healthcare delivery today,” said Reuben Guttman of Guttman, Buschner & Brooks, PLLC.

The attorneys who worked on the case from the Fuchsberg firm include Joseph Lanni, Edward Hynes, Jaehyun Oh, Alan Fuchsberg, and Bradley Zimmerman. It was Joseph Lanni who originally investigated this matter and directed the Fuchsberg firm’s efforts in developing, filing and litigating the case.

Those working on the case from GBB include Reuben Guttman, Traci Buschner, Liz Shofner, Justin Brooks, and Nancy Gertner.

The Jacob D. Fuchsberg Law Firm, LLP, is a prominent New York law firm representing plaintiffs in complex medical malpractice, product liability, toxic exposure, major vehicle and other personal injury cases. The firm’s attorneys, including those involved in this case, have regularly secured trial verdicts or settlements in the millions of dollars. Mr. Lanni, Mr. Fuchsberg, Mr. Zimmerman and Ms. Oh recently investigated and filed multiple lawsuits on behalf of workers at a national laboratory exposed to toxic chemicals and carcinogenic substances, including the solvents TCE, PCE and other volatile organic compounds, that received considerable attention with lengthy articles in the New York Times, Newsday, as well as on various televised news segments. The same attorneys at the firm are in the process of investigating and filing medical malpractice lawsuits involving septic shock related deaths, limb amputations, and disfigurements due to major medical errors at hospitals that appear related to negligent surgical stapler use by surgeons and inattentive postoperative care performed by improperly supervised junior residents and physician assistants. More information on the firm can be found at https://www.fuchsberg.com/

Guttman, Buschner & Brooks PLLC is a boutique firm whose attorneys have worked on cases recovering nearly $6 billion dollars for state and federal governments including  $280 million recovery in a non-intervened case against Celgene Corporation on the brink of trial (U.S. ex rel. Brown v. Celgene); a settlement against Humana Inc. achieved on the brink of trial (U.S. Graves ex rel. Humana). Attorneys at the firm represented the lead whistleblower in U.S. ex rel. McCoyd v. Abbott Labs, which involved the recovery of $1.6 billion for the government; one of several whistleblowers bringing FCA cases against GlaxoSmithKline in 2012, which resulted in the recovery of $1.04 billion (U.S. ex rel. Graydon v. GSK);  one of the whistleblowers bringing FCA cases against Pfizer which resulted in the recovery of $2.3 billion (U.S. ex rel. DeMott v. Pfizer); the lead whistleblowers in U.S. ex rel. Sandler and Paris v. Pfizer, which resulted in recovery of $257.4 million; the lead whistleblower in U.S. ex rel. Szymoniak v. Bank of America, which resulted in the recovery of $95 million; three of the whistleblowers FCA cases against a large hospital chain (U.S. ex rel. Doghramji v. CHS), which resulted in the recovery of $98 million; the lead whistleblower in U.S. ex rel.  Kurnik v. Amgen, which resulted in the aggregate recovery of $30 million from Amgen, Inc., Omnicare, and PharMerica Corp.; and the whistleblower in U.S. ex rel. Abrahamsen v. Hudson Valley, which resulted in a recovery of $5.5 million to the federal government and state government. More information on GBB can be found at www.gbblegal.com. The firm also maintains the following informational site for whistleblowers, the media, and academics: www.whistleblowerlaws.com

Also available online at PRNewswire.

On the Rule of Law: The Times They are a-Changing and So Should Trial Advocacy Training

Reuben Guttman Articles, Whistleblowers Blog , ,

By Reuben A. Guttman |

As a lawyer, I grew up in dusty warehouses, the repositories for massive document reviews. I tore through boxes, often disappointed to find reams of computer runs, no doubt the product of a twentieth-century printer that pecked out letters one at a time. I drafted my first complaint on an IBM Selectric II typewriter, hitting the whiteout key repeatedly with my index finger, often erasing entire sentences at a time. I walked that complaint to the federal courthouse in Pittsburgh, Pennsylvania, wrote out a check from my personal account, and received the file stamped copy. Back in the days of the “notice pleading,” my eleven-page masterpiece was a triumph. 

For young lawyers, this may seem like the practice of a different age. For veteran attorneys, it was yesteryear. In my lifetime, technological changes have rewritten the rules of litigation and trials. 

The days of the dusty warehouses are gone. Documents arriving on zip drives are uploaded to a platform enabling a lawyer to lay in bed at night and access millions of pages of potential evidence on a two-pound iPad or small iPhone. 

With iPhones, virtually every person, from every corner of the earth, can be videoed, photographed, or audio-recorded at a moment’s notice. Spontaneous comment, once pried loose through deposition testimony, is now recorded for posterity on Twitter feeds, Facebook newsfeeds, LinkedIn profiles, Instagram accounts, and emails. What should never have been can now be undone using a website called Wayback Machine that reveals original drafts of online information.

Of course, few people walk their complaint to the courthouse anymore for filing. That too is done electronically. Today, the only place one can find an IBM Selectric II is perhaps at a yard sale or in a Smithsonian Institution warehouse. The skilled typist, whose hands once danced on typewriter keyboards, are no longer necessary for big litigation. Lawyers can research, draft, edit, and file their pleadings directly from the confines of a tiny laptop computer, even while sipping coffee at the neighborhood coffeehouse.

The opportunities for young lawyers to hang a shingle and be a voice for the voiceless are almost infinite. The overhead of having a law library, a secretary, or a runner to file papers in court has vanished. Even where cases require more than one lawyer so that legal thought can be second-guessed, practice norms have changed. Today, smaller firms and solo practitioners join forces for a case or joint venture with other firms. Because individual lawyers can now represent those in need without the support of a big enterprise, training individual lawyers to put together and litigate cases is an even more empowering endeavor. Newly minted lawyers can no longer complain about employment prospects. A licensed law school graduate with the right training should be ready to represent clients. There is currently no dearth of those in need of representation. It is the job of law schools and legal educators to provide lawyers and would-be lawyers with practical skills.

Contemporary litigation is not just about new opportunities, it is also about how we investigate and try cases. Along with advances in technology, the United States Supreme Court has imposed procedural changes that front-load litigation, requiring lawyers to gather fact-specific evidence for the pleading stage. In the Iqbal and Twombly decisions, the Supreme Court eliminated the age-old notice pleading standard. After these opinions were issued, plaintiff lawyers feared lacking the necessary information to meet the new standards. Yet, information readily available on the Internet from LinkedIn, Facebook, Instagram, Twitter, and chat rooms continually provides data and information to would-be litigants before discovery even begins. Company policies, government standards, and the standards of well-known oversight entities like the Joint Commission of the Accreditation of Hospitals need not be accessed through a trip to the library and searching the stacks: they can be pulled up on an iPhone while watching a baseball game.

In his autobiography, My Life in Court, the great trial lawyer Louis Nizer talked about litigation as a game of probability. Witnesses are put on the stand and testify to an event or chain of events. While their testimony may be truthful, it may not be accurate. Memories are flawed and witnesses view events from a particular vantage point, often not incorporating a scene’s entirety.

One wonders if Nizer—who passed away in 1994—would view things differently today. iPhone videos, photographs, audio recordings, and emails memorializing real-time recollections eliminate jury guessing games and reduce the need for witnesses. Does counsel really need eyewitness testimony of a car accident also captured on an iPhone? In a theoretical sense, just as automation has taken workers off the production line, technological innovation has taken witnesses off the stand.

To keep up with the times, we need to adjust teaching methods. Trial advocacy programs often start by teaching students the art of direct and cross-examination, followed by openings and closings. Why not begin training by requiring that students try cases using only documents, videos, photographs, and audio recordings? This forces students to learn the evidentiary rules of relevance, hearsay, and authentication as well as the art of openings and closings. For their first mock trial, prohibit students from calling witnesses; make them try the case using non-testimonial evidence. Then have them retry the same case with witnesses. This approach is the legal equivalent of the basketball coach making players practice with their weak hand or the ice hockey coach having players scrimmage with their sticks turned upside down.

Forcing students to focus on exhibits also teaches them how to select, or better yet de-select—perhaps from a trove of electronic information—exhibits that nail the case. In an era of abundant information, the skill of exhibit de-selection is critical to avoid going down a rabbit hole and losing the decision maker.

Front-loaded litigation, caused by pleading rules changes, requires that students think about evidentiary rules during case development and investigation. Here are some rules to stress:

  • FRE 201 (Judicial Notice of Adjudicative Facts). So much available online information meets FRE 201 requirements. Challenge those in trial advocacy programs to look outside the case file for industry standards or other usable evidence. This not only teaches students about the rule, it encourages curiosity, creativity, and thinking outside the box.
  • FRE 801(d)(2) (An Opposing Party’s Statement). Simply teaching students about opposing party statements is not enough. In an age when opposing party statements are common, students must also learn this rule’s broad utility. Think about emails, PowerPoint presentations, LinkedIn, Facebook, and Tweets.
  • FRE 901 (Authenticating or Identifying Evidence) and FRE 902 (Evidence that is Self-Authenticating). Teach students that if evidence is one, relevant under 401; two, not excluded under 403; three, not hearsay under 801(d); or four, meets a hearsay exception under 803, then the 901 and 902 authentication rules are the gateway for presenting evidence without a witness in court. FRE 902(13) and (14) even contemplate the mechanisms to authenticate electronic data.
  • FRE 1006 (Summaries to Prove Content). In an age of more information than we know what to do with, consider FRE 1006 the “sleeper” of the Federal Rules of Evidence. It allows the presentation of data summaries to the court and/or the jury. Remember the movie The Rainmaker where the young lawyer, played by Tom Cruise, presents Great Insurance Company’s CEO with a foot-thick computer run of wrongfully denied claims? FRE 1006 permits summary usage in lieu of burdening the jury with a multitude of documents detailing the same thing. FRE 1006 may also eliminate the need for expert testimony from economists and accountants who will do nothing more than summarize and add up numbers.

Most importantly, we as teachers need to keep up with changes, adjust our methods, and maintain student engagement.


Reuben Guttman is a founding partner of Guttman, Buschner & Brooks, PLLC, in Washington, D.C. Read more of his On the Rule of Law columns here.

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