Judge rules criminal fraud case against Idaho doctor is frivolous

A federal judge found the government's case to be without merit. The Nevada U.S. Attorney's Office is pursuing an appeal.

By Amy Lynn Sorrel, AMNews staff. Aug. 20, 2007.

In a rare victory, a physician turned the tables on the government and won nearly $300,000 in legal fees for what a Nevada federal trial judge found to be a frivolous health care fraud case.

The Justice Dept. accused otolaryngologist Mark Capener, MD, now in Idaho Falls, Idaho, of billing for endoscopic sinus surgeries that investigators alleged either were unnecessary or never performed, and of upcoding. Authorities accused the doctor of defrauding eight private health insurers, Medicare and Medicaid through his billing practices.

But the U.S. District Court for the District of Nevada in June found that the government's case "lacked merit" because its main expert witnesses presented testimony at trial that was contradicted by another expert it interviewed beforehand.

"Either the government consciously decided to proffer a theory it knew was false, or it failed to conduct any investigation or inquiry to confirm whether [the principal expert's] contentions ... [were] in fact accurate," U.S. District Judge Robert C. Jones wrote.

The U.S. Attorney's Office for the District of Nevada declined to comment on the ruling. Government officials in July appealed the decision to the 9th U.S. Circuit Court of Appeals.

If the ruling sticks, it could offer some hope for physicians who are caught in similar circumstances and shine the light on the government's often aggressive tactics in health care fraud cases, some experts said.

Doctors often are forced to settle such cases, even when they did nothing wrong, because the financial stakes are so high, said Robert S. Salcido, a Washington, D.C.-based attorney for Akin Gump Strauss Hauer & Feld LLP and a former Justice Dept. civil fraud lawyer. Sometimes doctors also face significant jail time.