March 21, 2023

Supreme Court Considers Legal Standard For Aggravated Identity Theft

Supreme Court Considers Legal Standard for Aggravated Identity Theft

UPDATE [JUNE 9, 2023]: The Supreme Court declined to accept the government's broad interpretation of the federal identity theft statute. The Court ruled that Dubin did not violate the statute when he used Medicaid reimbursement numbers to obtain payment for services not provided. In the opinion, Justice Sonia Sotomayor wrote that the crux of petitioner’s overbilling was inflating the value of services actually provided, not the patient's means of identification. The opinion stated that a defendant’s misuse of another person’s identity must be “at the crux of what makes the underlying offense criminal, rather than merely an ancillary feature of a billing method.”

The February session of the Supreme Court’s October term recently concluded. The Court heard six cases which will be decided within the next few months. One case, Dubin v. United States, could have serious implications for individuals facing aggravated identity theft charges.

Case Background

William Dubin was a psychologist in Texas and owned a practice called PARTS (Psychological A.R.T.S., P.C.). William’s son David worked for the practice. PARTS was a qualified Medicaid provider and was receiving payments, meaning the practice was subject to Medicaid laws and regulations. David violated many Medicaid rules, but the one before the court involves the improper use of patient’s Medicaid information. 

David used patient Medicaid reimbursement numbers to obtain payment for services that the practice never provided. David and William were charged under the federal aggravated identity theft statute which states that a person commits aggravated identity theft when “during and in relation” to an enumerated felony “knowingly transfers, possesses, or uses, without lawful authority, a means of identification of another person” (18 U.S. Code § 1028A).

Under the statute, in addition to the punishment for the predicate felony the offender will receive an additional two year term of imprisonment. William and David were ultimately convicted by a jury. On appeal, David argued that he did not violate the federal identity theft statute because he did not make any misrepresentations about any patient’s identity and that the only fraud involved the nature of the services provided. 

A panel of the Fifth Circuit, followed by the Fifth Circuit en banc, affirmed the lower court’s ruling and upheld the conviction. However, en banc, eight of the 18 judges dissented and argued that the majority had failed to follow the Supreme Court’s guidance to not assign federal criminal statutes “a ‘breathtaking’ scope when a narrower reading is reasonable.”

Question Before the Court

The court will be interpreting the meaning of the federal identity theft statute and will ultimately decide if it is a violation of the statute any time a person mentions or otherwise recites someone else’s name while committing a predicate offense.

Legal Arguments

The government argues that under a plain reading of the statute, Dubin is guilty of aggravated identity theft. They claim Dubin used patient identities without lawful authority which is prohibited by the statute. They argue he had the lawful authority to use patient information to obtain legitimate reimbursements for Medicaid covered services, but when he used that information to commit Medicaid fraud, that use was unlawful and therefore a violation of the statute.

Dubin argues that the government’s interpretation of the aggravated identity theft statute is too expansive. He argues that he did not misrepresent any patient’s identity or present to be the patient. He claims he had full permission to use the patient's means of identification. The fraud committed was the services provided to the patient, not the identity of the patient.

Implications of Dubin

The interpretation of the federal aggravated identity theft statute is significant because of the mandatory imprisonment term it imposes. Any unlawful use of identity under the statute carries an imprisonment term of two years. For cases such as Medicare fraud where dozens of identities may have been used in perpetuating the fraud, defendants could see decades added onto their sentence.

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