United States District Court, D. Idaho
MEMORANDUM DECISION AND ORDER
Lynn Winmill Chief U.S. District Court Judge
Court has before it defendant Dillon's motion to stay
this action for recovery under the False Claims Act. The
motion is fully briefed and at issue. For the reasons
expressed below, the Court will deny the motion.
related criminal action, Dillon was charged with 24 counts of
health care fraud and 24 counts of aggravated identity theft.
See U.S. v. Dillon, 1:16-CR-037-BLW. The case went
to trial, and after the Government rested its case, Dillon
pled guilty to all counts, and she was later sentenced to 60
months incarceration. Following a hearing, the Court imposed
forfeiture of $847, 016, and ordered restitution in the sum
of $139, 769.80. Dillon filed a notice of appeal and started
serving her sentence on August 14, 2017. Her appeal is
criminal action, Dillon filed a motion to stay enforcement of
the monetary judgment against her. The Court denied her
motion, holding that her arguments challenging the forfeiture
sums were not “fairly debatable” and did not
raise a “substantial question, ” as required
under the applicable legal standard set out in U.S. v.
Handy, 761 F.2d 1279, 1283 (9th Cir. 1985). See
Memorandum Decision (Dkt. No. 133) in U.S. v. Dillon,
1:16-CR-037-BLW. Regarding the restitution, the Court
directed the Clerk to hold any restitution payment until the
appeal terminates. Id.
the trial in the criminal action was completed, the
Government filed this action, a civil False Claims Act
against Dillon, alleging that her dental billings to Medicaid
were fraudulent and that she improperly used the credentials
of a licensed dentist to conduct her fraud. In the motion now
pending before the Court for resolution, Dillon seeks to stay
this civil action pending her criminal appeal.
Constitution does not ordinarily require a stay of civil
proceedings pending the outcome of criminal proceedings.
Federal Sav. & Loan Ins. Corp. v. Molinaro, 889
F.2d 899, 902 (9th Cir.1989). “In the absence of
substantial prejudice to the rights of the parties involved,
such parallel proceedings are unobjectionable under our
jurisprudence.” S.E.C. v. Dresser Industries,
Inc., 628 F.2d 1368, 1374 (D.C.Cir.1980). Nonetheless, a
court may exercise its discretion to stay civil proceedings
when the interests of justice seem to require such action.
Keating v. Office of Thrift Supervision, 45 F.3d
322, 324 (9th Cir.1995). “A court must decide whether
to stay civil proceedings in the face of parallel criminal
proceedings in light of the particular circumstances and
competing interests involved in the case.”
Molinaro, 889 F.2d at 902. In determining whether to
stay civil proceedings, a court must first consider
“the extent to which the defendant's fifth
amendment rights are implicated.” Keating, 45
F.3d at 324. In addition, the court should generally consider
the following five factors: “(1) the interest of the
plaintiffs in proceeding expeditiously with this litigation
or any particular aspect of it, and the potential prejudice
to plaintiffs of a delay; (2) the burden which any particular
aspect of the proceedings may impose on defendants; (3) the
convenience of the court in the management of its cases, and
the efficient use of judicial resources; (4) the interests of
persons not parties to the civil litigation; and (5) the
interest of the public in the pending civil and criminal
litigation.” Id. at 325.
Dillon has appealed her guilty plea in the related criminal
case. As a result, there is a possibility that her Fifth
Amendment rights could be implicated because statements she
makes in this civil case could be used against her if she
prevails on appeal and the United States elects to retry the
criminal case. But this is, at best, a very remote
possibility, as the Court has found her grounds for appeal
quite weak, as discussed above. Moreover, Dillon's Fifth
Amendment rights could be protected through less drastic
means, such as by asserting the privilege on a
question-by-question basis, and by issuing a protective
order. See Doe v. City of San Diego, 2012 WL 6115663
at *3 (S.D.Ca. Dec. 10, 2012) (observing that once a criminal
trial is completed and an appeal pending, courts are
generally more reluctant to stay parallel civil proceedings,
and listing less drastic measures to protect Fifth Amendment
other factors beyond the Fifth Amendment concerns, a stay
would put a substantial burden on the Government as this
fraud occurred years ago and witnesses may be difficult to
find. Moreover, the Government will be pursuing this civil
False Claims Act case regardless of what happens to the
criminal case on appeal. Finally, the public interest would
not be served by a multiple-year delay to await the outcome
of the criminal appeal.
these reasons, the Court will deny the motion for stay.
accordance with the Memorandum Decision set forth above, NOW
THEREFORE IT IS HEREBY ORDERED, that the ...