Sunday, September 28, 2014
FRAUD VERDICT IN PONZI SCHEME CASE LEADS TO $80 MILLION IN SANCTIONS AGAINST MAN AND HIS COMPANIES
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
Court Imposes Injunctions and Monetary Sanctions of Over $80 Million Against Marlon Quan and His Companies Based On Fraud Verdict
The United States Securities and Exchange Commission announced today that, on September 19, 2014, Judge Ann D. Montgomery, of the U.S. District Court in Minneapolis, Minnesota, issued an Opinion and Order imposing sanctions against defendants Marlon Quan, Acorn Capital Group, LLC ("Acorn"), Stewardship Investment Advisors, LLC ("SIA") and ACG II, LLC ("ACG II"). In the Opinion and Order, Judge Montgomery imposed permanent injunctions against the defendants, and imposed financial sanctions of over $80 million against Marlon Quan and the three other defendants that he controlled.
The Commission's complaint, which was filed in March 2011, alleged that Marlon Quan helped to facilitate the massive fraud of Tom Petters by funneling several hundred million dollars of investor money into the Petters Ponzi scheme. According to the SEC's 2009 complaint against Tom Petters, he sold promissory notes to feeder funds like those controlled by Quan and his firms. Petters used some of the note proceeds to pay returns to earlier investors, diverting the rest of the cash to his own purposes. Petters had promised investors that their money would be used to finance the purchase of vast amounts of consumer electronics by vendors who then re-sold the merchandise to such retailers as Wal-Mart and Costco. In reality, this "purchase order inventory financing" business was merely a Ponzi scheme -- there were no inventory transactions.
The SEC alleged that Quan and his firms (SIA and Acorn) invested hundreds of millions of hedge fund assets with Petters while pocketing tens of millions of dollars in fees. Marlon Quan and his companies falsely assured investors that their money would be protected by various safeguards such as "lock box accounts." The complaint also alleged that when Petters was unable to make payments on investments held by the funds that Quan managed, Quan and his firms concealed Petters's defaults from investors.
The Commission had previously charged Petters and Illinois-based fund manager Gregory M. Bell with fraud, and filed additional charges against Florida-based hedge fund managers Bruce F. Prévost and David W. Harrold for similarly defrauding their investors in connection with investments in the Petters Ponzi scheme. Subsequent to filing the complaint against Marlon Quan and his companies, the SEC also charged James Fry, a Minnesota-based hedge fund manager, with similar misconduct.
After a nine-day trial, on February 11, 2014, the jury returned a verdict for the Commission and against the defendants, finding Marlon Quan and his three companies liable for securities fraud. In her September 19th Opinion and Order, Judge Montgomery permanently enjoined the Marlon Quan, Acorn, SIA and ACG II from violating, or aiding and abetting violations of, Section 17(a)(2) and (3) of the Securities Act, Section 10(b) of the Securities Exchange Act and Rule 10b-5 thereunder, and Section 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-8 thereunder. Judge Montgomery further ordered that Marlon Quan and the other defendants were liable, jointly and severally, for disgorgement of $80,6213,589 together with prejudgment interest.
The trial team from the Commission's Chicago Regional Office consisted of attorneys John E. Birkenheier, C.J. Kerstetter, Timothy Leiman, Michael Mueller, Senior Accountant Don Ryba, and paralegal Sarah Renardo.
HHS SAYS REPORT PROJECTS $5.7 BILLION DECREASE IN HOSPITAL UNCOMPENSATED CARE COSTS
HHS SAYS REPORT PROJECTS $5.7 BILLION DECREASE IN HOSPITAL UNCOMPENSATED CARE COSTS
FROM: U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES HHS,
Hospitals in states that have expanded Medicaid will receive about 74 percent of the total savings nationally
A report released today by the Department of Health and Human Services projects that hospitals will save $5.7 billion this year in uncompensated care costs because of the Affordable Care Act, with states that have expanded Medicaid seeing about 74 percent of the total savings nationally compared to states that have not expanded Medicaid.
For over a decade prior to the Affordable Care Act, the percentage of the American population that was uninsured had been growing steadily. But with the significant expansion of coverage under the health care law through the Health Insurance Marketplace and Medicaid, the uninsurance rate is at historic lows. As a result, the volume of uncompensated care provided in hospitals and emergency departments has fallen substantially in the last year, particularly in Medicaid expansion states.
“Hospitals have long been on the front lines of caring for the uninsured, who often cannot pay the full costs of their care,” said HHS Secretary M. Sylvia Burwell. “Today’s news is good for families, businesses, and taxpayers alike. It’s yet another example of how the Affordable Care Act is working in terms of affordability, access, and quality.”
Projections from today’s report suggest that hospitals in states that have expanded Medicaid under the Affordable Care Act will see greater savings than hospitals in states that have not expanded Medicaid. Hospitals in states that have expanded Medicaid are projected to save up to $4.2 billion, which makes up about 74 percent of the total savings nationally this year. Hospitals in states that have opted not to expand Medicaid are projected to save up to $1.5 billion this year, and which is only 26 percent of the total savings nationally.
Medicaid expansion continues to help an unprecedented number of Americans access health coverage, many for the very first time. According to a recent report, as of July, nearly 8 million additional individuals are now enrolled in Medicaid and the Children’s Health Insurance Program (CHIP), compared to before open enrollment in the Marketplace began in October 2013.
Because of the Affordable Care Act, states have new opportunities to expand Medicaid coverage to individuals with family incomes at or below 133 percent of the federal poverty level (generally $31,322 for a family of four in 2013). This expansion includes non-elderly adults without dependent children, who have not previously been eligible for Medicaid in most states. Twenty-eight states, including the District of Columbia have expanded Medicaid under the Affordable Care Act.
FROM: U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES HHS,
FROM: U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES
September 24, 2014
Contact: HHS Press Office
New report projects a $5.7 billion drop in hospitals’ uncompensated care costs because of the Affordable Care Act
Hospitals in states that have expanded Medicaid will receive about 74 percent of the total savings nationally
A report released today by the Department of Health and Human Services projects that hospitals will save $5.7 billion this year in uncompensated care costs because of the Affordable Care Act, with states that have expanded Medicaid seeing about 74 percent of the total savings nationally compared to states that have not expanded Medicaid.
For over a decade prior to the Affordable Care Act, the percentage of the American population that was uninsured had been growing steadily. But with the significant expansion of coverage under the health care law through the Health Insurance Marketplace and Medicaid, the uninsurance rate is at historic lows. As a result, the volume of uncompensated care provided in hospitals and emergency departments has fallen substantially in the last year, particularly in Medicaid expansion states.
“Hospitals have long been on the front lines of caring for the uninsured, who often cannot pay the full costs of their care,” said HHS Secretary M. Sylvia Burwell. “Today’s news is good for families, businesses, and taxpayers alike. It’s yet another example of how the Affordable Care Act is working in terms of affordability, access, and quality.”
Projections from today’s report suggest that hospitals in states that have expanded Medicaid under the Affordable Care Act will see greater savings than hospitals in states that have not expanded Medicaid. Hospitals in states that have expanded Medicaid are projected to save up to $4.2 billion, which makes up about 74 percent of the total savings nationally this year. Hospitals in states that have opted not to expand Medicaid are projected to save up to $1.5 billion this year, and which is only 26 percent of the total savings nationally.
Medicaid expansion continues to help an unprecedented number of Americans access health coverage, many for the very first time. According to a recent report, as of July, nearly 8 million additional individuals are now enrolled in Medicaid and the Children’s Health Insurance Program (CHIP), compared to before open enrollment in the Marketplace began in October 2013.
Because of the Affordable Care Act, states have new opportunities to expand Medicaid coverage to individuals with family incomes at or below 133 percent of the federal poverty level (generally $31,322 for a family of four in 2013). This expansion includes non-elderly adults without dependent children, who have not previously been eligible for Medicaid in most states. Twenty-eight states, including the District of Columbia have expanded Medicaid under the Affordable Care Act.
FRANK ROSE MAKES REMARKS ON SECURITY OF SPACE ENVIRONMENT
FROM: U.S. STATE DEPARTMENT
Ensuring the Long-Term Sustainability and Security of the Space Environment
Remarks
Frank A. Rose
Deputy Assistant Secretary, Bureau of Arms Control, Verification and Compliance
American Institute of Aeronautics and Astronautics, National Capital Section, Army Navy Country Club
Arlington, VA
September 25, 2014
Good afternoon. Today, I’d like to discuss a vital interest of the United States, as well as the entire global community: ensuring the long-term sustainability, stability, safety, and security of the space environment.
This audience is not one that needs to be convinced of the importance of the space environment to our national security. We all know very well that space assets are integral to our national security, as well as that of our allies and coalition partners.
For over five decades the global community has been inspired by humanity's space endeavors and reaped the benefits of the use and exploration of outer space. Some may take these benefits for granted so we must educate the public about the consequences if the space environment were to become unusable.
Outer space is a domain that no nation owns but on which all rely. Today the outer space environment is becoming increasingly congested from orbital debris, and contested from man-made threats—such as debris-generating Anti-Satellite systems—that may disrupt the space environment, upon which we all depend. The world’s growing dependence on the globe-spanning and interconnected nature of space capabilities mean that it is more important than ever for all citizens to understand that irresponsible acts in space by one entity can have damaging consequences for all. Therefore, it is essential that all nations work together to adopt approaches for responsible activity in space in order to preserve this domain for future generations.
In my remarks today, I would like to cover two aspects in regard to ensuring the security and sustainability of the space environment: first, the risks and dangers to space systems from debris generating anti-satellite or ASAT tests; second, the role of international diplomatic initiatives in protecting the long-term sustainability and security of the space environment.
Threats to Outer Space
Let me start with the risks and dangers. On July 23, the Chinese Government conducted a non-destructive test of a missile designed to destroy satellites in low Earth orbit. Despite China’s claims that this was a missile defense test; let me assure you the United States has high confidence in its assessment, that the event was indeed an ASAT test.
And China is not the only one pursuing these capabilities. As Director of National Intelligence James Clapper noted in his February 2014 congressional testimony, "Russian leaders openly maintain that the Russian armed forces have antisatellite weapons and conduct antisatellite research."
The United States believes that these threats, which include the continued development and testing of destructive anti-satellite systems, are both destabilizing and threaten the long-term security and sustainability of the outer space environment including all who benefit from outer space including the scientific, commercial, and civil space communities. Indeed, thousands of pieces of debris from the 2007 Chinese ASAT test continue to endanger space systems—as well as astronauts—from all nations, including China.
On the security side, ASAT weapons directly threaten satellites and the strategic and tactical information those satellites provide, and their use could be escalatory in a crisis or conflict. They also pose a direct threat to key assets used in arms control verification monitoring, command and control and communication, and warning and attack assessment. A debris generating test or attack may only be minutes in duration, but the consequences can last decades and indiscriminately threaten the space-based assets of all space-faring nations, and the information from space upon which all nations depend. On the civil space side, there have been numerous examples of the need to raise the orbit of the International Space Station due to a conjunction with a piece of debris from the 2007 Chinese ASAT test. And just as these systems threaten our national security space systems, they can threaten the civil satellites that are so essential to our everyday lives like weather satellites.
Multilateral Efforts toward a Stable and Sustainable Space Environment
Given these threats and the current era where dozens of States and nongovernmental organizations are harnessing the benefits of outer space, we have no choice but to work with our allies and partners around the world to ensure the long-term sustainability of the space environment. We also must speak clearly and publicly about what behavior the international community should find both acceptable and unacceptable. Over the past few years, the United States has worked to support a number of multilateral initiatives that seek to establish “rules of the road” for space that are both in the national security interests of the United States, and will further the long-term stability and sustainability of the space environment.
Just last year, I served as the United States expert on a United Nations-sponsored Group of Governmental Experts (GGE) study of outer space transparency and confidence-building measures (TCBMs). The GGE report which was published in July of last year and agreed to by China and Russia endorsed voluntary, non-legally binding TCBMs to strengthen stability in space. The GGE recommended that States implement measures to promote coordination to enhance safety and predictability in the uses of outer space. The GGE also endorsed “efforts to pursue political commitments, for example, a multilateral code of conduct, to encourage responsible actions in, and the peaceful use of, outer space.”
This International Code of Conduct for Outer Space Activities is another important multilateral initiative. Among the Code’s commitments for signatories is to refrain from any action which brings about, directly or indirectly, damage, or destruction, of space objects and to minimize, to the greatest extent possible, the creation of space debris, in particular, the creation of long-lived space debris. The Code could also help solidify safe operational practices, reduce the chance of collisions or other harmful interference with nations’ activities, contribute to our awareness of the space environment through notifications, and strengthen stability in space by helping establish norms for responsible behavior in space.
Lastly, the UN Committee on the Peaceful Uses of Outer Space (COPUOS) is also doing important work to move forward in the development of new international long-term sustainability guidelines. U.S. experts from the private sector as well the federal government have played a leading role in the COPUOS Working Group on Long-term Sustainability of Outer Space Activities, including key contributions from AIAA experts on space technical standards. These efforts contribute to the development of multilateral and bilateral space TCBMs. Exchanges of information between space operations centers also can serve as useful confidence building measures.
Multilateral diplomatic initiatives contribute greatly to defining acceptable and unacceptable behaviors in space and therefore are key components of the United States deterrence strategy. In addition, if we are serious about maintaining the space environment for future generations, we must support such measures that promote positive activities in space and further the creation of norms which dissuade countries from taking destabilizing actions such as the testing of debris-generating ASAT systems. By working with the international community, we can, and must, advance the long-term sustainability and security of the outer space environment for all nations and future generations
With that, I would like to thank you for your time and stop here in order to leave time for questions.
THREE PLEAD GUILTY, SEVEN MORE INDICTED IN $56 MILLION MEDICARE FRAUD CASE
FROM: U.S. JUSTICE DEPARTMENT
Thursday, September 25, 2014
Seven Defendants Indicted and Three Other Defendants Plead Guilty for Their Roles in $56 Million Medicare Fraud Scheme
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Kenneth A. Polite Jr. of the Eastern District of Louisiana, Special Agent in Charge Michael Anderson of the FBI’s New Orleans Field Office and Special Agent in Charge Mike Fields of the Dallas Regional Office of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG) made the announcement.
Paige Okpalobi, 57, of Slidell, Louisiana; Joe Ann Murthil, 57, of New Orleans; Latausha Dannel, 34, of Laplace, Louisiana; Dr. Winston Murray, 62, of Hammond, Louisiana; Dr. Divini Luccioni, 53, of Kenner, Louisiana; Christopher White, 48, of Destrehan, Louisiana; and Beverly Breaux, 66, of New Orleans, were charged in connection with their roles in a home health care fraud scheme involving thousands of Medicare recipients. Mark Morad, 51, of Slidell; Dr. Barbara Smith, 65, of Metairie, Louisiana; and Dr. Roy Berkowitz, 68, of Slidell, had been previously charged for their participation in the scheme, and today’s indictment added new charges against them.
The second superseding indictment comes one day after Dr. Alvin Darby, 58, of Slidell; Demetrius Temple, 54, of New Orleans; and Nicole Oliver, 44, of Napoleonville, Louisiana, each pleaded guilty to conspiracy to commit health care fraud for their roles in the scheme. Sentencing for each is scheduled for Jan. 7, 2015 before U.S. District Judge Sarah S. Vance of the Eastern District of Louisiana.
The indictment alleges that the defendants operated a number of companies in and around New Orleans that purported to offer home health services and durable medical equipment to Medicare beneficiaries. The companies, Interlink Health Care Services Inc., Memorial Home Health Inc., Lakeland Health Care Services Inc., Lexmark Health Care LLC, Med Rite Pharmacy Inc. and Medical Specialists of New Orleans, billed Medicare claiming that they provided home health services and durable medical equipment to Medicare beneficiaries, but the vast majority of these services and equipment were not medically necessary or not provided.
The indictment further alleges that Morad and Okpalobi owned and directed operations at these companies. Morad allegedly paid kickbacks to patient recruiters, including Temple and Oliver, to provide Medicare beneficiary numbers that were then used to bill Medicare. To conceal these kickbacks, Morad allegedly laundered Medicare money through a separate company he owned.
Court documents also allege that Okpalobi instructed doctors, including Smith, Berkowitz, Murray, Luccioni, and Darby, to falsely certify that beneficiaries were qualified for home health services, and to prescribe durable medical equipment that was not medically needed. These false certifications and prescriptions were then used to bill Medicare for the unnecessary services and equipment.
Murthil and Dannel were office managers who allegedly oversaw daily operations at the home health companies. White allegedly performed accounting services for these companies, and helped conceal the scheme by fabricating false tax and employee records. Breaux was a registered nurse who is alleged to have falsely certified that home health clients were homebound, and that she had provided home health care services when she had not.
From 2007 through 2014, the companies allegedly involved in the scheme submitted more than $56 million in claims to Medicare, the majority of which are allegedly fraudulent. Medicare paid approximately $50.7 million on those claims.
The charges contained in this indictment are merely accusations, and the defendants are innocent unless and until proven guilty.
The case is being investigated by HHS-OIG and the FBI and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Louisiana. The case is being prosecuted by Trial Attorney William G. Kanellis of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Patrice Harris Sullivan of the Eastern District of Louisiana.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
Saturday, September 27, 2014
RECENT DOD PHOTOS: MARINES PATROLLING IN AFGHANISTAN
FROM: U.S. DEFENSE DEPARTMENT
U.S. Marines use optic sensors on vehicles to observe the surrounding area during a security patrol in Shorab in Afghanistan's Helmand province, Sept. 20, 2014. U.S. Marine Corps photo by Cpl. John A. Martinez Jr.
U.S. Marines patrol in a tactical column in Shorab in Afghanistan's Helmand province, Sept. 20, 2014. U.S. Marine Corps photo by Cpl. John A. Martinez Jr.
SECRETARY KERRY'S REMARKS AT FRIENDS OF COMPREHENSIVE NUCLEAR-TEST-BAN MINISTERIAL
FROM: U.S. STATE DEPARTMENT
Remarks At The Friends of the Comprehensive Nuclear-Test-Ban Treaty Ministerial
Remarks
John Kerry
Secretary of State
United Nations Headquarters
New York City
September 26, 2014
Thank you, Fumio. Thank you very, very much. Mr. Secretary-General, let me begin by thanking you for an extraordinary week here at the United Nations. I think this has been an UNGA that’s been as seized with the issues of the day as forcefully and as directly as at any time, and we’re very appreciative for all of the UN’s efforts to make that happen. And I can tell you that everybody here with respect to the CTBT will say “Ban forever,” I promise you. (Laughter.)
It’s a privilege to join the friends of the CTBT ministerial because we are here in pursuit of a very noble goal, and that is to ensure that one day our children and our grandchildren will live in a world where the very real threat of nuclear weapons is a subject to be read about in the history books and not in the newspapers, not as a matter of daily currency. And I am mindful of what Fumio said about representing the one country in the world that has seen nuclear weapons in time of war. We learned, all of us, the awesome power that we’ve sought to contain ever since that time, and I believe it is containable. And I might say that I’m proud that President Obama has been pushing to reduce America’s arsenal along with Russia, and that we did manage to pass, when I was in the Senate, the START Treaty.
But the Comprehensive Nuclear Test-Ban treaty has thus far eluded for various reasons. It remains a critical part of our effort to strip the world of these weapons. Some people don’t think that’s possible. I don’t agree. It’s interesting when you have Henry Kissinger, George Shultz, former secretaries of Defense and State all joining together saying it is possible. So people need, obviously, to embrace the notion that how we resolve conflicts has to change dramatically. That’s the purpose of the UN. How we deal with each other has to change. But if we lose the ability to envision that change, we lose something very special in the human spirit, and I think everybody here understands what I mean. We have to believe in the possibility of changing the way we resolve conflict, and if we do, then deterrence by nuclear weapons is something that can change.
So any time we work cooperatively to address the threat of nuclear weapons, we do make the world a safer place, and I have said to people who are doubters about the capacity to take this deterrence away – I’ve said to them, “Every step you take towards it – whether you get there tomorrow or in 50 years or what – makes the world a safer place. There is no question about that.”
The interim agreement that we struck with Iran, the P5+1, has made the world safer because a nuclear stockpile that was at 20 percent has been reduced to 1 – and nothing. And inspections are taking place and there is greater certainty about possibilities than there was before it went into place. And it remains our fervent hope that Iran and the P5+1 can in the next weeks come to an agreement that would benefit the world and it would deal, ultimately, with the issues that are contained in the Comprehensive Test-Ban Treaty.
So I come here to reiterate the Obama Administration’s unshakable commitment to seeing this treaty ratified and entered into force. And though we have not yet succeeded in ratifying it for pure political, ideological reasons – not substance, I assure you – we nevertheless are pledged to live by it, and we do live by it, and we will live by it.
Last week, U.S. Secretary of Energy Ernie Moniz made clear a very compelling case for the value of stockpile stewardship in the context of this treaty. And I’ll say just a word about our commitment to the verification regime. Part of that commitment means engaging the American people, our citizens, on the treaty’s merits. And I know some members of the United States Senate still have concerns about this treaty. I believe they can be addressed by science, by facts, through computers and the technology we have today coupled with a legitimate stockpile stewardship program.
So let me be crystal-clear about what this treaty is and what it isn’t. This treaty is about diminishing our reliance on nuclear weapons. It’s about reducing dangerous competition among nuclear powers. It’s about responsible disarmament, and ultimately it’s about advancing international peace and security by building a different structure on which we can all rely.
I also want to be clear about what this treaty isn’t. This treaty isn’t just a feel-good exercise. It’s in all of our national security interests, and it’s verifiable. In fact, its verification regime is one of the great accomplishments of the modern world. The international monitoring system is nearly complete; it is robust, it is effective, and it has contributed critical scientific data on everything from tsunami warnings to tracking radioactivity and nuclear reactor accidents.
What this treaty does is simple: It sets standards and enforces the kind of verification measures that the United States already has in place, and that’s why we remain a strong supporter of the treaty. And we continue to be the single largest contributor to its budget. In fact, we’ve already provided more than 40 million above our assessment over the past two years. As the United States Senate considers ratification, it will require assurances not only that an effective, operational, and sustainable verification regime is in place, but that other nations are committed to sustaining it. That’s why we urge the seven other Annex II states to accelerate their efforts to ratify the treaty and urge all signatory states to provide the resources necessary to complete the verification regime. Let me be clear: There is no reason for the Annex II states to wait for the United States before completing their own ratification process, and this treaty is a national security imperative for all of us.
So I close by just saying that President Obama and I believe that this time we’re living in, with all the conflict of ISIL and failed and failing states and Ebola and conflicts that we wish did not exist, still could become an age of construction, not destruction. A lot of that depends on the people in this room and on the leaders who are not here but were here this week, and it certainly depends on our willingness to fulfill a promise to our children and what they will inherit.
So we have to act with courage in the months ahead – days, weeks, and months ahead, and we know that our goal of a nuclear-free world may be a lofty one. But believe me, it is absolutely one worth fighting for, especially in an age where dirty bombs and nuclear materials and all of these other dangers exist. We would be better off, clearly, emphasizing the passage of the Comprehensive Test-Ban Treaty so that we will never again see additional nuclear powers, and so that the existing nuclear powers will continue to move to eliminate these weapons from Earth.
Thank you, Mr. Secretary-General. (Applause.)
DOJ FILES STATEMENT OF INTEREST IN NEW YORK CASE INVOLVING DEFENDANTS RIGHT TO COUNCIL
FROM: U.S. JUSTICE DEPARTMENT
Thursday, September 25, 2014
Department of Justice Files Statement of Interest in New York State Right to Counsel Case
The Department of Justice today filed a statement of interest with the Supreme Court of the State of New York, Albany County in Hurrell-Harring v. State of New York. In this class action litigation, the plaintiffs allege that, due to systemic failures in four New York counties, indigent criminal defendants have been constructively denied the right to counsel.
In Hurrell-Harring the plaintiffs allege that a lack of funding for indigent defense deprives public defenders of the time or resources to prepare cases or meaningfully represent their clients and amounts to the denial of counsel in violation of Gideon v. Wainwright and the Sixth Amendment. In its statement of interest, the department advised the court that under resourcing public defense may force even otherwise competent and well-intentioned public defenders into a position where they are, in effect, a lawyer in name only. The statement of interest added that if the court finds that the plaintiffs have been constructively denied the right to counsel on a systemic basis, the court has broad injunctive authority to remedy those constitutional violations.
“To truly guarantee adequate representation for low-income defendants, we must ensure that public defenders’ caseloads allow them to do an effective job,” said Attorney General Eric Holder. “The Department of Justice is committed to addressing the inequalities that unfold every day in America’s courtrooms, and to fulfilling the Supreme Court’s historic decision in Gideon v. Wainwright. America’s indigent defense systems exist in a state of crisis, and over 50 years after it was made, the promise of Gideon is not being met.”
“This case is emblematic of a national crisis in indigent criminal defense,” said Acting Assistant Attorney General Molly Moran of the Civil Rights Division. “The right to counsel is one of the core guarantees of the Bill of Rights, and yet, as countless cases and studies show, indigent defense systems across the country are facing significant challenges in meeting their Sixth Amendment obligations.”
The purpose of the statement of interest is to provide the court with a framework to assess the plaintiffs’ claim of constructive denial of counsel. As the department explained in the statement of interest, “An analysis of Gideon cases informs the United States’ position that constructive denial of counsel may occur when: (1) on a systemic basis, counsel for indigent defendants face severe structural limitations, such as a lack of resources, high workloads, and understaffing of public defender offices; and/or (2) indigent defenders are unable or are significantly compromised in their ability to provide the traditional markers of representation for their clients, such as timely and confidential consultation, appropriate investigation, and meaningful adversarial testing of the prosecution’s case.”
The Hurrell-Harring case was filed in 2007 and brought by former indigent defendants who faced criminal charges in five New York counties. The plaintiffs seek systemic reform to prevent future violations of the right to counsel. The state court trial is scheduled to begin on Oct. 7, 2014.
BIOFUELS: POTENTIAL BENEFITS AND DRAWBACKS STUDIED
FROM: NATIONAL SCIENCE FOUNDATION
Building the framework for the future of biofuels
Do plant-based fuels offer a realistic reprieve from a fossil-powered future? An ASU engineer examines the full cycle
They offer a promising renewable resource as a replacement for nonrenewable fossil fuels, and a way to reduce the amount of greenhouse gas emissions being pumped into the atmosphere as a result of our use of conventional petroleum-derived fuels.
They could help the United States take major steps to reduce the country's dependence on oil from other parts of the world.
For more than five years Amy Landis has led research that is revealing the potential rewards of developing large-scale biofuels production, as well as the potential drawbacks we would face in the effort.
"We are documenting that there would be environmental benefits, but also trade-offs in growing biofuels that would have to be dealt with," said Landis, an associate professor in the School of Sustainable Engineering and the Built Environment, one of the Ira A. Fulton Schools of Engineering at Arizona State University (ASU).
Two National Science Foundation (NSF) grants combined to provide about $650,000 for projects directed by Landis, enabling her to paint a clearer picture of the impacts of developing a major biofuels industry. Both grants were through the NSF's Chemical, Bioengineering, Environmental and Transport Systems Division.
One project looked at the feasibility of growing bioenergy crops on marginal lands where soil nutrients first have to be restored to enable agricultural use. A second project involved forecasting the environmental impacts of next-generation biofuels.
According to Landis, lands damaged by industrial waste or other pollutants could be restored sufficiently to support agriculture for growing bioenergy crops.
Landis' team was able to use other forms of nonhazardous industrial waste materials to neutralize the acidity of soil at polluted sites--particularly abandoned mining lands. The method restored fertility to a level that allowed many of the plants, from which biofuels are derived, to grow.
As a result, biofuels agriculture could become a significant contributor to soil remediation, land reclamation and natural storm water management that fertile, absorbent ground can provide.
A complex system
A downside is that many biofuel crops, like food crops, require fertilizers that cause water degradation, and the water carrying the fertilizers can be transported by runoff into other areas where they can do environmental harm.
To fully understand the ramifications of a big commitment to cultivation of biofuel sources, Landis said she took a holistic approach that examines the entire life cycle of bio-based products.
She looked beyond the benefits of greenhouse gas reductions and energy savings to the challenges of weighing long-term benefits and potential problems.
Landis has been able to quantify some potential future nationwide impacts of growing the various kinds of bioenergy plants--corn grain, soybeans, switchgrasses, canola and algae, for example--to extensively assess economic, social and environmental effects.
That included evaluating the feasibility of bioenergy crops to meet the Energy Independence and Security Act Renewable Fuel Standards, which sets challenging goals for fuel production quantity.
The project involved consideration of the various agricultural and environmental management strategies that would be critical to preventing or mitigating undesirable consequences that could result from growing bioenergy crops to manufacturing biofuels.
The work was also intended to provide a framework for a life-cycle assessment method that can be applied to future evaluations of biofuels cultivation and production, and for gauging the sustainability of various fuel development strategies throughout the United States.
"Our work shows there is no silver-bullet biofuel that provides a perfect sustainability solution," Landis explained. "Developing domestic sustainable fuels is a complex problem and we must consider the wide range of environmental impacts, economic ramifications and social factors.
"In particular for biofuels that rely heavily on fertilizer, our work shows that we should pay particular attention to protecting water quality," she said. "However, it's not all doom and gloom. Our NSF-funded research also developed some creative solutions to utilize abandoned lands and waste materials to produce biofuels."
Broader impacts
The NSF support enabled Landis to use her research findings for education outreach. Much of the information is being incorporated into undergraduate and graduate courses. In addition, in the past several years the grants have supported research activities of four undergraduate students and five graduate students, while also allowing another seven graduate students to engage in work related to the research projects.
Outreach efforts have also included demonstrations to K-12 students and their families. For example, Landis and her lab team have brought plants out of the greenhouse to show how biofuels are made from plants.
This and similar learning activities at ASU's annual Engineering Open House, DiscoverE Day, Night of the Open Door events and Engineering Adventure programs are reaching more than 14,000 younger students each year.
In addition, Landis volunteers at an annual Geared for Girls summer camp, where she talks about what her research is showing about the life cycles of energy and products.
Landis has been able to bring a multifaceted perspective to her biofuels research, drawing on the broad range of expertise reflected in her diverse academic and research roles at ASU.
Those roles include that of research director for the Center for Earth Systems Engineering and Management; senior sustainability scientist with the Julie Ann WrigleyGlobal Institute of Sustainability; a Fellow of Sustainable Development and Ethics with the Lincoln Center for Applied Ethics; and her appointment as a Tooker Professor of STEM Education in the Ira A. Fulton Schools of Engineering.
-- Joe Kullman, Arizona State University
Investigators
Amy Landis
Jason Monnell
Related Institutions/Organizations
Arizona State University
University of Pittsburgh
HHS SAYS $212 MILLION WILL BE GOING TO PREVENT CHRONIC DISEASES
FROM: U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES
September 25, 2014
HHS announces nearly $212 million in grants to prevent chronic diseases
Funded in part by the Affordable Care Act, grants focus on preventing tobacco use, obesity, diabetes, heart disease, and stroke
Health and Human Services Secretary Sylvia M. Burwell today announced nearly $212 million in grant awards to all 50 states and the District of Columbia to support programs aimed at preventing chronic diseases such as heart disease, stroke and diabetes. Funded in part by the Affordable Care Act, the awards will strengthen state and local programs aimed at fighting these chronic diseases, which are the leading causes of death and disability in the United States, and help lower our nation’s health care costs.
A total of 193 awards are being made to states, large and small cities and counties, tribes and tribal organizations, and national and community organizations, with a special focus on populations hardest hit by chronic diseases. The Centers for Disease Control and Prevention will administer the grants.
“These grants will empower our partners to provide the tools that Americans need to help prevent chronic diseases like heart disease, stroke, and diabetes,” said Secretary Burwell. “Today’s news is important progress in our work to transition from a health care system focused on treating the sick to one that also helps keep people well throughout their lives.”
The goals of the grant funding are to reduce rates of death and disability due to tobacco use, reduce obesity prevalence, and reduce rates of death and disability due to diabetes, heart disease, and stroke.
“Tobacco use, high blood pressure, and obesity are leading preventable causes of death in the United States,” said CDC Director Tom Frieden, M.D., M.P.H. “These grants will enable state and local health departments, national and community organizations, and other partners from all sectors of society to help us prevent heart disease, cancer, stroke, and other leading chronic diseases, and help Americans to live longer, healthier, and more productive lives.”
This is one of many ways the Affordable Care Act is improving access to preventive care, and coverage for people with pre-existing conditions. Under the Affordable Care Act, 76 million Americans in private health insurance have gained access to preventive care services without cost-sharing and issuers can no longer deny coverage to anyone because of a pre-existing condition.
Chronic diseases are responsible for 7 of 10 deaths among Americans each year, and they account for more than 80 percent of the $2.7 trillion our nation spends annually on medical care.
PHARMA COMPANY TO PAY OVER $56 MILLION TO RESOLVE ALLEGATIONS OF FALSE CLAIM ACT VIOLATIONS
FROM: U.S. JUSTICE DEPARTMENT
Wednesday, September 24, 2014
Shire Pharmaceuticals LLC to Pay $56.5 Million to Resolve False Claims Act Allegations Relating to Drug Marketing and Promotion Practices
Pharmaceutical company Shire Pharmaceuticals LLC will pay $56.5 million to resolve civil allegations that it violated the False Claims Act as a result of its marketing and promotion of several drugs, the Justice Department announced today. Shire, located in Wayne, Pennsylvania, manufactures and sells pharmaceuticals, including Adderall XR, Vyvanse and Daytrana, which are approved for the treatment of attention deficit hyperactivity disorder (ADHD), and Pentasa and Lialda, which are approved for the treatment of mild to moderate active ulcerative colitis.
“Patients and health care providers must receive accurate information about available prescription drugs so that they can make safe and informed treatment decisions,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division. “The Department of Justice will be vigilant to hold accountable pharmaceutical companies that provide misleading information regarding a drug’s safety or efficacy.”
The settlement resolves allegations that, between January 2004 and December 2007, Shire promoted Adderall XR for certain uses despite a lack of clinical data to support such claims and overstated the efficacy of Adderall XR, particularly relative to other ADHD drugs. Among the allegedly unsupported claims was that Adderall XR was clinically superior to other ADHD drugs because it would “normalize” its recipients, rendering them indistinguishable from their non-ADHD peers. Shire allegedly stated that its competitors’ products could not achieve similar results, which the government contended was not shown in the clinical data that Shire collected. Shire also allegedly marketed Adderall XR based on unsupported claims that Adderall XR would prevent poor academic performance, loss of employment, criminal behavior, traffic accidents and sexually transmitted disease. In addition, Shire allegedly promoted Adderall XR for the treatment of conduct disorder without approval from the Food and Drug Administration (FDA).
The settlement further resolves allegations that, between February 2007 and September 2010, Shire sales representatives and other agents allegedly made false and misleading statements about the efficacy and “abuseability” of Vyvanse to state Medicaid formulary committees and to individual physicians. For example, one Shire medical science liaison allegedly told a state formulary board that Vyvanse “provides less abuse liability” than “every other long-acting release mechanism” on the market. However, the government contended that no study Shire conducted had concluded that Vyvanse was not abuseable, and, as an amphetamine product, the Vyvanse label included an FDA-mandated black box warning for its potential for misuse and abuse. Shire also made allegedly unsupported claims that treatment with Vyvanse would prevent car accidents, divorce, arrests and unemployment.
Additionally, the settlement resolves allegations that from April 2006 to September 2010, Shire representatives improperly marketed Daytrana, administered through a patch, as less abuseable than traditional, pill-based medications, and, for part of this period, improperly made phone calls and drafted letters to state Medicaid authorities to assist physicians with the prior authorization process for prescriptions to induce these physicians to prescribe Daytrana and Vyvanse.
Finally, the settlement resolves allegations that between January 2006 and June 2010, Shire sales representatives promoted Lialda and Pentasa for off-label uses not approved by the FDA and not covered by federal healthcare programs. Specifically, the government alleged that Shire promoted Lialda off-label for the prevention of colorectal cancer.
"Marketing efforts that influence a doctor’s independent judgment can undermine the doctor-patient relationship and short-change the patient,” said U.S. Attorney Zane David Memeger for the Eastern District of Pennsylvania. “Where children’s medication is concerned, it can interfere with a parent’s right to clear information regarding the risks to the safety and health of their child. Shire cooperated throughout this investigation and, in advance of this settlement, began to correct its marketing activities.”
"This settlement represents another important step in our fight against fraud in federally-funded healthcare programs such as Medicare and Medicaid,” said U.S. Attorney Zachary T. Fardon for the Northern District of Illinois. “The Shire settlement returns funds not only to the U.S. government but also to the individual states whose health care programs rely in part on the efficacy of jointly-funded programs like Medicaid. We will continue doing everything in our power to combat fraud and ensure the integrity of our healthcare programs.”
As a result of today’s $56.5 million settlement, the federal government will receive $35,713,965, and state Medicaid programs will receive $20,786,034. The Medicaid program is funded jointly by the federal and state governments. In addition, Shire has separately reached agreement with the U.S. Department of Health and Human Services-Office of the Inspector General (HHS-OIG) on a corporate integrity agreement, which will address the company’s future marketing efforts.
“Our agency will continue to hold drug companies responsible for seeking to boost profits using false and misleading claims about products, such as the powerful medications prescribed to children and other drugs at issue in this settlement,” said Chief Counsel to the HHS Inspector General Gregory E. Demske. “We entered into a corporate integrity agreement with Shire that requires comprehensive compliance safeguards, oversight of Shire promotional activities, and compliance certifications from Shire’s board of directors and management.”
The allegations resolved by the settlement arose from a lawsuit filed by Dr. Gerardo Torres, a former Shire executive, and a separate lawsuit filed by Anita Hsieh, Kara Harris and Ian Clark, former Shire sales representatives. The lawsuits were filed under the False Claims Act’s whistleblower provisions, which permit private parties to sue for false claims on behalf of the government and to share in any recovery. Torres will receive $5.9 million.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of HHS. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $22.4 billion through False Claims Act cases, with more than $14.2 billion of that amount recovered in cases involving fraud against federal health care programs.
This case was a cooperative effort among the U.S. Attorneys’ Offices for the Eastern District of Pennsylvania and the Northern District of Illinois, the Justice Department’s Civil Division, Office of the Inspector General for the Office of Personnel Management, HHS-OIG and the FDA. The HHS Office of the General Counsel-CMS Division and the National Association of Medicaid Fraud Control Units also provided assistance.
SECRETARY KERRY'S REMARKS AT GLOBAL ALLIANCE FOR CLIMATE-SMART AGRICULTURE
FROM: U.S. STATE DEPARTMENT
Remarks at a Reception for the Global Alliance for Climate-Smart Agriculture
Remarks
John Kerry
Secretary of State
Waldorf-Astoria Hotel
New York City
September 24, 2014
SECRETARY KERRY: Well, thank you. Listen, thank you very, very much for being patient and hanging in here, though I noticed a lot of you have glasses in your hand with some liquid in it and therefore you haven’t been completely deprived, I can tell.
This city during these days of UNGA does not lend itself well to diplomatic speed dating, and unfortunately, I sort of scheduled one too many. And I just came from a meeting with my counterpart, Sergey Lavrov, and obviously, we had a lot to talk about. And that’s why I’m running a little bit late, and I apologize for that.
Let me thank Nancy, Dr. Nancy Stetson, for her work, and I’ll say a word about her in a minute. But I’m also very, very privileged and I want to say thank you to the Dutch Government, the Kingdom of the Netherlands, and to Agriculture Minister Sharon Dijksma. I’m very, very pleased, and her director-general is here somewhere. I don’t know, he was here a moment ago. I met him. There he is. (Applause.) But thank you so much for being here and being part of this and helping to launch this alliance. The Dutch Government is extraordinarily committed and forward-thinking about this kind of issue, and that’s exactly what we need to be right now, putting this critical connection, this nexus between climate change and food security, at the center of the agenda.
I wish it were otherwise. I’ve been involved in this effort – Nancy alluded to it – going back to the 1970s. The first thing I did when I returned from Vietnam was not protest the war, which I shortly did, but become active in Earth Day 1970, the first Earth Day, and helped to organize it in my home state of Massachusetts, when 20 million Americans came out and said we don’t want to live next to toxic waste sites, we don’t want to be getting cancer from Woburn dump, things like that in Massachusetts. Particularly we had the Cuyahoga River that lit on fire, literally.
And those 20 million people ultimately engaged in a way that became very political. They targeted the 12 worst voters in Congress, labeled them the “Dirty Dozen” and in the very next election beat seven of the 12. That is what brought us the Clean Air Act, the Safe Drinking Water Act, Marine Mammal Protection Act, Coastal Zone Management Act, and actually created the Environmental Protection Agency we didn’t have when that first took place.
So there’s been a hell of a journey from there to here. And I went to Rio and the Earth Summit in the 1990s and so forth. Unfortunately, it was a voluntary process. It didn’t work and we now are where we are, the hottest year in history last year, the last ten years have been the hottest ten years in history. I mean, it’s an extraordinary statement about the lack of willpower of governments on a global basis, ours included, to have been able thus far to be able to do what we need.
I’m proud to say that President Obama is changing that. We are moving rapidly now. We have ten times the amount of solar power in place that we had five years ago. We have three times the amount of renewables in place that we had. We have new automobile standards, new building standards, so forth and so on.
Why do I mention all of this in the context of food security? Well, for the very simple reason that the real solution is not to be talking about just moving things and coming up with resistant seed and doing our work in the laboratory. The real solution is not to damage it in the first place and to be able to preserve an ecosystem that functions.
But we all know we’re on a path right now that’s probably going to make the – that deprives us of the right of not worrying about mitigation and deprives us of the opportunity to avoid adaptation. So we are where we are, and the only responsible thing that we can do as a consequence of that is work at this.
That’s why I brought Nancy Stetson on board, because Nancy and I worked for two decades side by side when I served in the Senate. And through her work on malaria, TB, and AIDS, principally, I saw her ability to be able to break down things that were very complex and multi-layered, and make them happen. You are looking at the woman who really wrote the first piece of AIDS legislation – no joke. And we passed it. We even got Jesse Helms to support it. And that became the foundation of what became known as PEPFAR. So Nancy Stetson, thank you for your leadership and your effort and everything you did. (Applause.)
So that’s what we’re going to try and do with this alliance. When climate change and food security present these new challenges that they do, we need new partnerships and new solutions in order to tackle them. And the vitality of our ecosystem, the ability of the ecosystem to provide billions of people with food, is under stress, regrettably, like never before.
I was chairman of the fisheries, oceans subcommittee for a long period of time in the Senate, and I saw what has been happening in the major fisheries of the world. Even as we went and tried to ban driftnet fishing and rewrite the Magnuson laws and do all these things – still overfished, still too much money chasing too few fish, still major shifts in the ecosystem as the result of increases in acidity, the acidification of the oceans, the changes in ocean currents, what’s happening with the melting of the icecaps and so forth has a profound impact on the future of food. And all you have to do is talk to farmers or even talk to garden club members in America and they will tell you how things that used to grow in certain places don’t grow anymore, how there’s been a migration of certain species and capacities for growth, a band in the center of America that’s moved north and south.
So the link is clear: Climate change affects how much food we’re able to produce, and it affects – and how much food we produce actually affects climate change at the same time. Now we see this drought that’s hitting in various parts of the world, but particularly in Central America.
And this alliance is going to try to bring capable partners together who have the ability to find solutions. Climate-smart agriculture, it’s that simple. And the World Bank and the FAO have been working together for a long time and making successful investments in drought-resistant corn, soybeans, other climate-resilient crops for a number of years now.
For our part, we have some of the most advanced laboratories and research institutions. And as Secretary Vilsack told all of you yesterday, we’re targeting more of our resources to support agricultural innovation. The President doubled down on this approach yesterday in his executive order, making support for climate resilience a first-tier priority across our development programs.
And if you look at what’s happening in Central America, you can understand why. Sixteen of 22 provinces in Guatemala have been declared by the government a state of emergency. Crop losses in El Salvador have now reached 60 percent of their crops. In Nicaragua, staples like corn and beans cost four times more today than what they cost last spring.
So at the State Department, we’re going to look immediately at what we can do to help in Central America and other parts of the world where we can find our partners to apply our talents to this challenge.
In Ethiopia, we’ve partnered with DuPont to help farmers increase maize production by 50 percent.
In Mali, we’re supporting an aggressive agroforestry program, helping farmers to tackle the problem of desertification, and promoting the planting of fruit and fodder and fuel-wood for income generation.
In Bangladesh, we’re investing with private sector partners in intensified rice production, and helping farmers to diversify into high-value, nutrient-rich commodities like fish. But again, fish – it’s going to be dependent on your overall management of the ecosystem and is it sustainable. It has to be done in a sustainable fashion.
So these are the kinds of successful investments in food security, innovation, and resilience that we plan to showcase to 20 million-plus visitors next year at the Milan Expo. And we hope to attract new partners and new investments in this effort in doing that.
Every nation has an ability to be able to play a part in this. I hate the idea that – I mean, I don’t want to see all our energy going – I want to see us do it because we have to. But I still preach the notion that we have time still to turn this around if we make tough choices about carbon, carbon pricing, where we’re going with respect to the overall issue of climate change, so we minimize the need to do this. And in the end, confronting these challenges means we’re going to have to, unfortunately, invent; we’re going to have to innovate. Maybe I shouldn’t say unfortunately because you benefit anyway, but it’s the wrong way to come at it, and I think everybody here knows that.
That said, we’re going to do it, and I’m proud to be part of this alliance. I’m proud for this announcement tonight, and I’m delighted that you’re all here to share in it. Let’s get the job done.
Thank you all very, very much. (Applause.)
Friday, September 26, 2014
DOD PHOTOS: U.S. AIRCRAFT INVOLVED WITH AIRSTRIKES IN SYRIA
FROM: U.S. DEPARTMENT OF DEFENSE
U.S. Air Force Maj. Gena Fedoruk and U.S. Air Force 1st Lt. Marcel Trott take off in a KC-135 Stratotanker from a base in the U.S. Central Command area of responsibility to support airstrikes in Syria, Sept. 23, 2014. Multiple KC-135 Stratotankers were part of a large coalition strike package that was the first to attack Islamic State of Iraq and the Levant targets in Syria. U.S. Air Force photo by Senior Airman Matthew Bruch.
A pair of U.S. Air Force F-15E Strike Eagles fly over northern Iraq after conducting airstrikes against ISIL targets in Syria, Sept. 23, 2014. U.S. Air Force photo by Senior Airman Matthew Bruch.
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