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McCutcheon v. United States

United States District Court, N.D. Alabama, Northwestern Division

August 25, 2014

UNITED STATES OF AMERICA, Respondent. CR. No. 12-183-IPJ


INGE PRYTZ JOHNSON, Senior District Judge.

Petitioner Diana K. McCutcheon moves the court to vacate, set aside, or correct her sentence pursuant to 28 U.S.C. § 2255 and for an evidentiary hearing on the claims in her motion (doc. 1). Despite giving the court every assurance that she did in fact understand the charges against her, agree with the facts as recounted in the plea agreement, enter her guilty plea knowingly and voluntarily, as well as assuring the court that her attorney was "excellent, " Dr. McCutcheon now claims that due to ineffective assistance of counsel, she pleaded guilty neither knowingly nor voluntarily. The court, however, remains persuaded by the numerous uncoerced admissions Dr. McCutcheon made during the plea hearing, and, therefore, finds that her § 2255 motion is due to be denied.


Diane McCutcheon pleaded guilty to health care fraud and wire fraud arising out of her internal medicine and laser surgery practices. At the time of her indictment, McCutcheon was a physician who owned and operated three clinics: Elgin Quickmed Clinic, Lexington Clinic, and Lexington Cosmetic Laser Surgery, which was housed in the same building as Elgin Clinic. Plea Agreement p. 3 (crim. doc. 32). Enrolled as a health case service provider to Blue Cross Blue Shield of Alabama (BCBS) and Medicare, McCutcheon submitted claims for her services to BCBS and Medicare using numerical codes ("CPT codes"). Id. at 4. McCutcheon contracted with Medical Management Associates of Florence Alabama to perform her billing services. Id. In 2010, BCBS noticed that McCutcheon was billing an unusually high number of treatments under the CPT code 17004, which corresponded to a procedure for the destruction of 15 or more skin lesions at one time. Id. Upon receiving BCBS's tip-off, the FBI began investigating McCutcheon, which produced the following evidence: In 2007, McCutcheon ranked 14, 273% higher in reimbursements for 17004 procedures than her counterparts and her cost for the procedure was $53.44 per patient when the average physician's cost was $0.18 per patient. Id. at 5. In 2008, McCutcheon ranked 22, 970% higher than her peers in 17004 reimbursements and had an average cost per patient of $88.68 compared to peers' average costs of $0.20 per patient. Id. In 2009, McCutcheon ranked 18, 564% higher than her peers in 17004 reimbursements and had an average cost per patient for the procedure of $66.97 compared to peers' average cost per patient of $0.26. Id. And in 2010, McCutcheon ranked 18, 648% higher than her peers in 17004 reimbursements and had an average cost per patient of $195.39 compared to peers' average costs per patient of $0.70. Id. at 5. In 2007, 2008, and 2009, 17004 procedures were McCutcheon's second-most billed procedure and 17004 procedures were her most commonly billed procedure in 2010 and 2011. Id. at 5-6.

In 2008, McCutcheon's 17004 bills constituted 70% of the total amount billed to Medicare for 17004 procedures by internal medicine physicians in the state of Alabama. Id. at 6. In 2009, McCutcheon accounted for 90% of those billed procedures and in 2010, 95%. Id. While 17004 procedures constituted only 1.29% of her peers' billings, they constituted 25% of McCutcheon's Medicare billings. Id. Upon interviewing McCutcheon's patients, the Government learned that while "[a] nurse practitioner or the defendant did spray some liquid nitrogen on the patients' skin when they were in for laser treatments, " this procedure did not constitute a 17004 procedure, under which the defendant billed for the removal of 30 or more skin lesions through cryosurgery. Id.

In response to a 2010 audit by BCBS, McCutcheon hired a private consultant who reviewed McCutcheon's medical records and concluded that she had engaged in overbilling 17004 procedures and should reimburse BCBS. Id. A dermatologist retained as an expert also reviewed McCutcheon's records and determined that had the 17004 procedure been performed as often as claimed in the records, the patients would have sustained serious harm because it takes at least three weeks for patients to heal from cryosurgery. Id. at 7. McCutcheon's records indicated, however, that she performed 17004 procedures a week or two apart and on consecutive days in one case. Id.

McCutcheon pleaded guilty to Health Care Fraud in violation of 18 U.S.C. § 1347 (Counts 4, 5, 64 & 65) and Wire Fraud in violation of 18 U.S.C. § 1343 (Counts 31 & 86). Judgement p. 1 (crim. doc. 45). On April 23, 2013, the court entered judgment against McCutcheon, from which she did not appeal. Id. The court sentenced McCutcheon to a term of twelve months and one day imprisonment followed by three years of supervised release. Id. at 2-3. McCutcheon filed the instant § 2255 motion on April 14, 2014 (doc. 1). The court ordered the government to show cause as to why McCutcheon's motion should not be granted (doc. 2), and the Government timely responded (doc. 9). McCutcheon's § 2255 motion is timely. Although McCutcheon has been released from prison since she filed her § 2255 motion, she remains in federal custody due to her term of supervised release. See United States v. Brown, 117 F.3d 471, 475 (11th Cir. 1997) ("Supervised release carries with it the possibility of revocation and additional jail time. Therefore, we conclude, that as a person serving a term of supervised release, Brown was in custody' within the meaning of § 2255 when he filed his petition in the district court."). Having considered Dr. McCutcheon's motion and the government's response, the court finds that McCutcheon's motion is due to be denied for the reasons discussed below.


Despite all indications to the contrary, Dr. McCutcheon now claims that her attorney rendered ineffective assistance and that as a result, McCutcheon understood neither what she was pleading guilty to nor the consequences of entering a guilty plea. It is well-settled that "representations of the defendant, his lawyer, and the prosecutor at a [plea hearing], as well as any findings made by the judge accepting the plea, constitute a formidable barrier in any subsequent collateral proceedings. Solemn declarations in open court carry a strong presumption of verity." Blackledge v. Allison, 431 U.S. 63, 73-74 (1977) (citation omitted). See also United States v. Medlock, 12 F.3d 185, 187 (11th Cir. 1994) ("There is a strong presumption that the statements made during the colloquy are true"). Additionally, where "the record refutes the applicant's factual allegations or otherwise precludes habeas relief, a district court is not required to hold an evidentiary hearing." Schiriro v. Landrigan, 550 U.S. 465, 474 (2007).

I. Ineffective Assistance of Counsel

To establish an ineffective counsel claim, a defendant must show that the lawyer's performance was so objectively unreasonable as to be deficient and that the deficiency prejudiced the client. Strickland v. Washington, 466 U.S. 668, 687 (1984). The test for deficient performance by counsel is an objective one. Id. at 688. Moreover, "[j]udicial scrutiny of counsel's performance must be highly deferential" and "a court must indulge a strong presumption that counsel's conduct falls within the wide range of reasonable professional assistance." Id. at 689. A petitioner establishes prejudice by showing that "there is a reasonable probability that, but for counsel's unprofessional errors, the result of the proceeding would have been different." Boyd v. Allen, 592 F.3d 1274, 1293 (11th Cir. 2010) (quotation marks and citation omitted). In the case of guilty pleas, "to satisfy the prejudice' requirement, the defendant must show that there is a reasonable probability that, but for counsel's errors, he would not have pleaded guilty and would have insisted on going to trial." Hill v. Lockhart, 474 U.S. 52, 59 (1985). If a petitioner cannot satisfy both the deficiency and prejudice prongs, the court must deny the requested relief. Butcher v. United States, 368 F.3d 1290, 1293 (11th Cir. 2004).

Specifically, McCutcheon argues that her counsel rendered ineffective assistance by "failing to investigate material aspects of the charges and applicable defenses in advising [her] to plead guilty, " failing to adequately prepare for the plea negotiation, "inducing [McCutcheon] to plead guilty with a promise of a sentence of probation, " and "inducing [her] to plead guilty with threats of a draconian sentence." § 2255 Motion pp. 5, 13, 16, 17 (doc. 1). As an initial matter, despite Dr. McCutcheon's current allegations of her counsel's deficiencies, at the plea hearing she expressed that she had no problems with her counsel's handling of her case. McCutcheon even went so far as to praise her lawyer's performance:

THE COURT: Okay. Did you read through these documents with Mr. Tuten before you signed them?
THE DEFENDANT: Yes, ma'am.
THE COURT: Did you have sufficient time to talk to him about anything and everything that was in those documents?
THE DEFENDANT: Yes, Your Honor.
THE COURT: Okay. Have you had enough time to talk to Mr. Tuten about the facts of this case?
THE DEFENDANT: Yes, Your Honor.
THE COURT: Have you had enough time to talk to him about your constitutional rights?
THE DEFENDANT: Yes, Your Honor.
THE COURT:... [A]re you satisfied with the services he has provided you as your lawyer in this case?
THE DEFENDANT: Yes, Your Honor.
THE COURT: Okay. One of the waivers includes a waiver of a right to file a motion pursuant to 28 U.S.C. Code, Section 2255.
So basically, this is your last chance to tell me if you have any complaints about anything Mr. Tuten has done or not done in connection with being your lawyer in this case.
THE DEFENDANT: No. He's been an excellent lawyer.

Plea Hearing Transcript pp. 5-6, 7 (crim. doc. 49) (emphasis added). But, more importantly, even were the court to accept McCutcheon's factual allegations as true, McCutcheon's ineffective assistance of counsel claims fail because she cannot establish that she has been prejudiced by any of her attorney's alleged deficiencies. In other words, McCutcheon cannot establish that but for her attorney's alleged deficiencies, she would not have pleaded guilty and would have insisted on going to trial.

A. Counsel's Failure to Properly Negotiate Plea or Investigate Material Aspects of Charges

McCutcheon's extensive factual recitations in support of this claim, § 2255 Motion pp. 5-12 (doc. 1), are squarely refuted by her own representations at the plea and sentencing hearings.[2] For example, McCutcheon claims that "[d]efense counsel rendered ineffective assistance in advising Movant to plead guilty when the overwhelming evidence indicating [sic] that there was no knowing and intentional criminal intent on the part of Movant, but rather a staggering number of billing discrepancies." § 2255 motion p. 8 (doc. 1). Yet the court explicitly informed McCutcheon that she was charged with knowing and willful violations, not mistaken error, and McCutcheon voiced no objections:

THE COURT: And with respect to the charge of wire fraud - wire fraud. The Government would have to prove that on or about the times and places set out in the indictment, Counts Number 31 and 86, that you knowingly devised or participated in a scheme to defraud or to obtain money or property by using false pretenses, representations, or promises.
I'm just telling you right now knowingly means not as a result of mistake.
The Government would further have to prove that the false pretenses, representations, or promises ...

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