The 5th U.S. Circuit Court of Appeals on Monday upheld the convictions of seven people, including four physicians, convicted in one of the biggest medical bribery and kickback schemes uncovered in Texas.
An appellate panel of Judges Priscilla Richman, Jacques L. Weiner Jr. and Don R. Willett rejected every ground for appeal raised by the defendants convicted at trial in the Forest Park Medical Center fraud case. The seven defendants were found guilty in 2019 by a federal jury in Dallas of an array of charges stemming from the operation of Forest Park, a physician-owned surgical hospital that was at the center of a far-ranging insurance scam.
According to the government, the now-defunct North Dallas hospital took in $200 million in questionable insurance benefits from early 2009 through 2012 by bribing doctors and others to steer well-insured patients its way. Investigators said the bribes totaled $40 million, much of it disguised as consultant fees or marketing subsidies.
Those convicted at trial and sent to prison were:
• Mac Burt, Forest Park’s million-dollar-a-year co-administrator;
• Dr. Douglas Won, spinal surgeon and co-founder of the Minimally Invasive Spine Institute of Dallas;
• Dr. Michael Rimlawi, spinal surgeon and Won’s onetime partner at MISI;
• Dr. Shawn Henry, Fort Worth spinal surgeon and Forest Park investor;
• Dr. Mike Shah, pain-management physician;
• Jackson Jacob, owner of a company Forest Park used to channel payments to physicians; and
• Iris Forrest, nurse and workers’ compensation insurance consultant
Initially, 21 people, including eight doctors, were indicted in the Forest Park case. Many of them plea-bargained and agreed to cooperate with the government. Nine went to trial in 2019 in Dallas before U.S. District Judge Jack Zouhary, a visiting judge from Ohio.
One defendant at trial, a weight-loss surgeon, was acquitted. The jury could not reach a verdict in the case against another defendant, a midlevel manager at Forest Park. Rather than undergo a retrial, she pled guilty to one misdemeanor.
The Fifth Circuit appellate arguments took place Aug. 1, 2022.
The panel in affirming the convictions found no reversible error on the part of Judge Zouhary.
Significantly, from the government’s standpoint, the appellate panel upheld the novel decision by prosecutors from the U.S. attorney’s office for the Northern District of Texas to indict the Forest Park defendants under an anti-racketeering statute from the Kennedy era: The International Travel and Tourism Act of 1961, commonly called the Travel Act.
The law makes it a federal offense to travel interstate or internationally, or to use the mail or “any facility in interstate or foreign commerce,” for the purpose of committing or distributing the proceeds of unlawful activities.
In effect, it makes the act of traveling (or using the mail or engaging in interstate commerce) in the furtherance of certain crimes an indictable federal offense separate from the underlying state or federal crime.
One argument made by the appellants was that prosecutors had overreached in using the Travel Act to, in effect, justify federal prosecution of alleged violations of a state law, the Texas commercial bribery statute.
Representing Burt on appeal are Edward J. Loya Jr. of Epstein Becker & Green in Dallas and Richard W. Westling of Epstein Becker & Green’s Washington, D.C., office
Representing Won on appeal are Daniel L. Geyser of Haynes Boone in Dallas and Kevin Blake Ross of Dallas.
Representing Rimlawi on appeal is David Gerger of Gerger Hennessy & Martin in Houston.
Representing Henry on appeal is Mick Mickelsen of Broden & Mickelsen in Dallas.
Representing Shah on appeal are Abbe Lowell and Christopher Man of Winston & Strawn in Washington.
Representing Jacob on appeal is Sara A. Johnson of New Orleans.
Representing Forrest on appeal is Angela Laughlin Brown of Gray Reed & McGraw in Dallas.
The government’s appellate attorneys are Gail A. Hayworth, Brian W. McKay and Stephen S. Gilstrap of the U.S. attorney’s office in Dallas.