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United States v. Hubbard

United States District Court, E.D. Kentucky, Central Division, Lexington

April 26, 2017

UNITED STATES OF AMERICA, Plaintiff,
v.
LONNIE W. HUBBARD, Defendant.

          MEMORANDUM OPINION AND ORDER

          Danny C. Reeves, United States District Judge

         Defendant Lonnie Hubbard has moved the Court for a new trial, arguing that: (i) his convictions were not supported by sufficient evidence[1] and (ii) the Court improperly admitted other act evidence in violation of Fed.R.Evid. 404(b). [Record No. 371] The government disagrees, contending that Hubbard's conviction was not against the manifest weight of the evidence and that the “other act” evidence cited by Hubbard is intrinsic to the charges and is not subject to Rule 404(b). [Record No. 372] Hubbard's motion will be denied for the reasons that follow.

         I.

         Hubbard was a licensed Kentucky pharmacist who owned RX Discount Pharmacy in Berea, Kentucky. He was the active pharmacist at this business and also employed relief pharmacists to assist him from time-to-time. Law enforcement began investigating Hubbard after one of the relief pharmacists reported Hubbard's practices regrading filling out-of-state oxycodone prescriptions.

         The United States indicted Hubbard and several others in December 2015. Hubbard was charged with a total of 73 counts, including charges of conspiring to illegally distribute pseudoephedrine and oxycodone; illegally distributing pseudoephedrine; illegally distributing hydrocodone; illegally distributing oxycodone; opening and maintaining a business for the purpose of illegally distributing controlled substances and pseudoephedrine; conspiring to commit money laundering; and money laundering. The Court conducted a trial, and the jury ultimately convicted Hubbard of all of the charges presented to it.[2]

         II.

         Under Federal Rule of Criminal Procedure 33, a court “may vacate any judgment and grant a new trial if the interest of justice so requires.” The rule itself does not define the “interest of justice” or identify the circumstances under which a new trial is appropriate. United States v. Munoz, 605 F.3d 359, 373 (6th Cir. 2010). However, courts have determined that a defendant is entitled to a new trial where, as relevant here, the “jury's verdict was against the manifest weight of the evidence” or the district court committed a substantial legal error. Id. (internal quotation marks and citations omitted). Neither showing has been made entitling Hubbard to relief in the present case.

         A. Manifest Weight of the Evidence

         Sustaining a motion for a new trial based on a claim that the verdict is against the manifest weight of the evidence is appropriate “only in the extraordinary circumstance where the evidence preponderates heavily against the verdict.” United States v. Hughes, 505 F.3d 578, 592-93 (internal quotation marks and citation omitted). A district court is permitted to assess the credibility of witnesses and weigh the evidence in making this determination. United States v. Lutz, 154 F.3d 581, 589 (6th Cir. 1998).[3]

          i. Conspiracy Charge

          The indictment charges Hubbard with conspiring to distribute pseudoephedrine and oxycodone in violation of 21 U.S.C. §§ 841 and 846. [Record No. 295] This required the government to prove that Hubbard conspired with others to distribute oxycodone outside the scope of his professional practice and without a legitimate medical purpose and to distribute pseudoephedrine while knowing, intending, or having reasonable cause to believe that it would be used to manufacture a controlled substance. 21 U.S.C. §§ 841, 846. The jury was instructed that, to find Hubbard guilty of this charge, they must find that the government proved: (1) an agreement to violate the drug laws; and (2) that Hubbard knowingly and voluntarily joined the conspiracy.

         For the agreement element, the government must prove that the participants in the conspiracy came to some form of mutual understanding regarding the illegal activity. United States v. Pearce, 912 F.2d 159, 161 (6th Cir. 1990). It is not necessary that the government prove a formal agreement. United States v. Hughes, 891 F.2d 597, 601 (6th Cir. 1989) Instead, a conspiracy can be “inferred from acts done with a common purpose” and it is sufficient for the evidence to establish some tacit or implicit understanding. Id. “The existence of a conspiracy may be inferred from circumstantial evidence that can reasonably be interpreted as participation in the common plan.” United States v. Martinez, 430 F.3d 317, 330 (6th Cir. 2005) (internal quotation marks omitted). Although sales alone do not establish the agreement necessary for proof of a conspiracy, “evidence of repeat purchases from a single source and large volumes of narcotics creates an inference of conspiracy.” United States v. MacLloyd, 526 Fed.Appx. 434, 439 (6th Cir. 2013) (citations omitted). A pharmacist may conspire to distribute controlled substances illegally “by filling prescriptions of oxycodone for the benefit of numerous drug dealers and fake patients” while knowing or having reason to know that the individuals are obtaining the drugs for illicit use. United States v. Green, 818 F.3d 1258, 1275 (11th Cir. 2016).

         The jury's verdict convicting Hubbard of conspiring to distribute oxycodone in violation of 21 U.S.C. §§ 841 and 846 is not against the manifest weight of the evidence. First, the government introduced evidence of the existence of an agreement to illegally distribute oxycodone outside the scope of professional practice and not for a legitimate medical purpose. Individuals from Kentucky testified that they would travel to other states to obtain prescriptions for pain medication. These individuals confirmed that they did not have a medical need for the pain medication but, instead, were addicts who were required to travel out-of-state to obtain prescriptions because they were unable to obtain them from doctors in Kentucky. They further reported that they would use the oxycodone or sell it on the street.

         There was also ample evidence showing that Hubbard knowingly agreed to distribute oxycodone outside the scope of professional practice and not for a legitimate medical purpose, and that he voluntarily joined the conspiracy by filling these prescriptions. Many government witnesses testified to the numerous “red flags”[4] suggesting that Hubbard's customers were purchasing oxycodone for illicit purposes. First, the fact that so many customers were bringing prescriptions for pain medication from other states was an indication that these prescriptions were illegitimate. Hubbard would require cash payments to fill out-of-state oxycodone prescriptions at inflated prices. There was also evidence that customers would request pills of a certain color, which is indicative of diversion. Simply put, some colors are more valuable than others when being sold on the street.

         The evidence of Hubbard's conduct in filling prescriptions also proved that he was aware that the products were intended for illegitimate uses. Witnesses testified that Hubbard told customers not to arrive early or wait outside the pharmacy because he did not want a line in front of his business. There was also evidence that Hubbard attempted to manipulate data regarding the sale of controlled substances by limiting the number of out-of-state prescriptions that he would fill each day, and that he required customers to obtain unnecessary non-controlled medications. Additionally, the government introduced video evidence in which a customer told Hubbard that he was having trouble obtaining prescriptions for controlled substances. Hubbard then provided him with information for an out-of-state pain clinic, stating that this clinic was the only place he knew that was “selling any.”

         Based on the evidence presented during trial, the jury's verdict convicting Hubbard of conspiring to distribute oxycodone outside the scope of professional practice and not for a legitimate medical purpose was not against the manifest weight of the evidence.

         Likewise, the jury's verdict convicting Hubbard of conspiring to distribute pseudoephedrine while knowing, intending, or having reasonable cause to believe that it would be used to manufacture a controlled substance was not against the manifest weight of the evidence. The government introduced evidence establishing an agreement to distribute pseudoephedrine illegally. Multiple witnesses testified that they would purchase products containing pseudoephedrine from Hubbard's pharmacy. They would then sell it to others who they knew would use it to manufacture methamphetamine or manufacture methamphetamine themselves. There was also proof that Hubbard would sell pseudoephedrine products to customers who had travelled long distances to purchase it from his pharmacy because the pharmacy had a reputation for being an easy place to purchase the product. This evidence demonstrated an implicit agreement to distribute pseudoephedrine while knowing or having reasonable cause to believe that it would be used to manufacture methamphetamine in violation of the drug laws.

         The evidence also showed that Hubbard knowingly violated the drug laws. Hubbard sold pseudoephedrine products at inflated prices, which is indicative of knowledge that the customers were purchasing the product to manufacture methamphetamine and not for the medicinal purpose for which it is intended. Additionally, Hubbard informed a law enforcement agent that he would sell pseudoephedrine to anyone with “a pulse and an ID, ” indicating that he adopted a lax approach to sales that facilitated the purchase of pseudoephedrine products for the purpose of manufacturing methamphetamine. The jury's conviction for conspiracy to distribute pseudoephedrine in violation of the drug laws was not against the manifest weight of the evidence.

         ii. ...


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