Sentencing Monday for Four Defendants Charged in Operation Backlash

Thursday, August 24, 2017 | 0

Four defendants indicted in what prosecutors called “one of the largest insurance bribery schemes ever uncovered in San Diego County” are scheduled to be sentenced Monday.

The San Diego County Superior Court online calendar says Alexander K. Martinez, Ruben M. Martinez, Jennifer L. White and Julian E. Garcia are scheduled to appear at 1:30 p.m. for a “probation hrg-sentencing.”

No additional information is available through the court’s website. Unlike other counties in California, San Diego does not make criminal case documents, dockets or case histories available on its website.

The San Diego County District Attorney’s Office convened a press conference in January 2016 to announce charges against the four defendants scheduled to be sentenced Monday, along with nine others indicted for their alleged involvement in a pay-for-play scheme dubbed “Operation Backlash.” The office didn’t respond to multiple phone calls and emails from WorkCompCentral on Wednesday.

The grand jury indictments released in 2016 offer little explanation about the nature of the allegations against any of the defendants. The indictments identify statutes the defendants are accused of violating, but don’t provide detail about what the defendants allegedly did.

During her January 2016 press conference, San Diego County District Attorney Bonnie Dumanis said the defendants were involved in an illegal referral scheme that ran from 2012 through 2015. She said the payment of an estimated $500,000 in kickbacks resulted in millions of dollars in fraudulent workers’ compensation claims, adding, “We may never know the exact amount of the loss.”

Dumanis said the nature of the “kickback scheme” was that the defendants paid kickbacks of $50 to $100 to chiropractors in San Diego, Escondido and Calexico who referred injured workers for certain medical services.

The four defendants scheduled to appear Monday were also indicted by a federal grand jury in 2014 on charges relating to illegal payments for patient referrals. Documents filed in the federal cases provide a little more information about the nature of the charges.

Alexander Martinez worked as a marketer for a chiropractor identified only as “Dr. A.” He also owned and operated a company called Line of Sight Inc., according to the federal indictment. Ruben Martinez also worked as marketer for “Dr. A” and owned and operated Desert Blue Moon.

The federal indictment alleges Los Angeles radiologist Dr. Ronald Grusd offered to pay bribes to both Alexander Martinez and Ruben Martinez to influence “Dr. A” to refer work comp patients to California Imaging Network.

Alexander Martinez is named as a defendant in six indictments handed down by the San Diego County Grand jury. Those indictments alleging 181 offenses including delivering, receiving or accepting compensation for referring patients, and concealing information that affected a person’s right to an insurance benefit.

Ruben Martinez is named as a defendant in a single indictment handed down by the county grand jury, alleging 54 counts of delivering or receiving compensation for patient referrals and concealing information about an insurance claim.

Both Alexander Martinez and Ruben Martinez pleaded guilty to a single charge of conspiracy to commit honest services mail fraud in May 2016. The actual plea agreements are not available on the federal court’s website. Sentencing in the federal cases is scheduled for Dec. 11.

Julian Garcia also pleaded guilty to a federal conspiracy change in October and is scheduled to be sentenced in federal court on Jan. 8.

According to the federal grand jury indictment, Garcia was a provider of durable medical equipment who allegedly offered “Dr. A” — it’s not clear that this is the same person identified as “Dr. A” in the other indictment — and others illegal referral fees. The federal indictment says Garcia offered providers $50 for each workers’ compensation patient they sent to him with a prescription for hot/cold therapy.

The San Diego County grand jury indictment charged Garcia with two counts of accepting or making patient referral fees, and 10 counts of concealing information about an insurance claim.

The final defendant scheduled to appear Monday, Jennifer White, was indicted by the county grand jury on 12 counts of offering or receiving compensation for referring patients, and 31 counts of concealing information about an event affecting an insurance claim. No additional information is available from the indictment.

A criminal information filed with the U.S. District Court for Southern California in December 2016 doesn’t say much more. The charging paper accused her of one count of conspiracy for causing a check for $20,000 to be paid to Alexander Martinez.

She pleaded guilty to the federal conspiracy charge in December 2016 and is scheduled to be sentenced Dec. 4.

There is no information about why White allegedly arranged a $20,000 payment to Martinez in either state or federal court papers.

Grusd has pleaded not guilty to federal charges accusing him of paying fees for referrals. His attorney is asking the federal court to throw the case out because of allegedly vindictive prosecution and the appearance of vindictiveness.

Earlier in August, Grusd alleged in court filings that federal prosecutors increased the number of charges against him in retaliation for not accepting a plea agreement. The November 2015 indictment included eight counts, compared to a 45-count superseding indictment filed in July.

Grusd also alleges that he didn’t actually reject a plea agreement. Rather, he said that because of confusion between federal and county prosecutors, he could not figure out what the deal would entail before the feds yanked it off the table.

Specifically, Grusd said he wanted to know about restitution he would have to pay if he accepted a plea deal. The U.S. Attorney’s Office referred questions from his attorney to county prosecutors. And county prosecutors didn’t respond to questions before the March 31 deadline to accept the deal passed.