United States District Court, D. Minnesota
M. Lewis, Assistant United States Attorney, United States
Attorney's Office, Minneapolis, MN, on behalf of
Deborah K. Ellis, Esq., Ellis Law Office, St. Paul, MN, on
behalf of Defendant Thurlee Belfrey.
W. DeVore, Esq., Larson King, LLP, St. Paul, MN, on behalf of
Defendant Roylee Belfrey.
P. Bruder, Esq., Mitchell, Bruder & Johnson, Edina, MN,
on behalf of Defendant Lanore Belfrey.
MEMORANDUM OPINION AND ORDER
MONTGOMERY U.S. DISTRICT JUDGE
matter is before the undersigned United States District Judge
for a ruling on Defendants Roylee Belfrey, Thurlee Belfrey,
and Lanore Belfrey's (collectively,
“Defendants”) Objections [Docket Nos. 221, 222,
223] to Magistrate Judge Tony N. Leung's July 5, 2017
Report and Recommendation [Docket Nos. 217, 218, 219]
(“R&R”). In the R&R, Judge Leung
recommends denying Thurlee Belfrey and Roylee Belfrey's
Motions to Dismiss Count 1 [Docket Nos. 166, 181], denying
Lanore Belfrey's Motion to Dismiss Counts 1 and 2 [Docket
No. 178], and denying Lanore Belfrey's Motion to Suppress
Statements, Admissions and Answers [Docket No.
173]. For the reasons set forth below, all of
the Objections are overruled.
are charged in a multi-count indictment with conspiracy to
commit health care and tax fraud. See generally
Fourth Superseding Indictment [Docket No. 159]. The Fourth
Superseding Indictment alleges that from 2001 to 2014,
Defendants participated in a conspiracy to defraud the United
States by concealing Thurlee Belfrey's involvement in the
operations and management of a healthcare business that
accepted money from the Medicare and Medicaid federal
healthcare programs. Id. ¶¶ 9-10, 15-16.
Thurlee Belfrey's involvement in the business was
concealed because he was excluded by the Minnesota Department
of Human Services (“DHS”) from participating in
all federal healthcare programs after a felony conviction for
Medicaid fraud in Minnesota state court. Id.
¶¶ 6, 8. The Fourth Superseding Indictment alleges
that Defendants concealed Thurlee Belfrey's participation
in the healthcare business by arranging for ownership of the
business to be in the name of Thurlee Belfrey's wife,
Lanore Belfrey. Id. ¶ 9, 16. Lanore Belfrey is
also alleged to have: 1) falsely certified to the DHS that no
persons with an ownership or control interest in the business
and no agent or employee of the business had ever been
convicted of a crime involving a Medicare or Medicaid
program; 2) identified key employees of the business for
background investigations, but intentionally withheld Thurlee
Belfrey's name from DHS; and 3) signed IRS forms on
behalf of the business even though Thurlee Belfrey controlled
the business' operations. Id. ¶¶ 9,
addition to concealing Thurlee Belfrey's involvement in
the healthcare business, the Fourth Superseding Indictment
also alleges Defendants “caused the submission of false
and fraudulent claims . . . and the diversion of proceeds of
the fraud” for the personal use and benefit of
Defendants and others. Id. ¶¶ 10, 17. The
healthcare business operated by Roylee and Thurlee Belfrey
allegedly received millions of dollars from healthcare
programs funded by the United States during the course of the
conspiracy and scheme. Id. ¶ 10.
and Thurlee Belfrey have filed Motions to Dismiss Count 1 of
the Fourth Superseding Indictment, and Lanore Belfrey has
filed a Motion to Dismiss Counts 1 and 2. Lanore Belfry has
also filed a Motion to Suppress statements that she made to
IRS agents who interviewed her in her home while law
enforcement officers were executing a search of her
residence. Judge Leung issued an R&R recommending that
all of Defendants' motions be denied. All Defendants have
filed Objections to the R&R.
Standard of Review
district judge may refer a defendant's motion to dismiss
an indictment or motion to suppress evidence to a magistrate
judge for recommendation. Fed. R. Crim. P. 59(b)(1). The
district judge must make an independent, de novo
determination of those portions of the report and
recommendation to which a party objects. Fed. R. Crim. P.
59(b)(3); 28 U.S.C. § 636(b)(1)(C); D. Minn. L.R.
72.2(b). A district judge “may accept, reject, or
modify, in whole or in part, the findings or recommendations
made by the magistrate judge.” 28 U.S.C. §
Roylee and Thurlee Belfrey's Objections
and Thurlee Belfrey both object to the recommendation to deny
their Motions to Dismiss Count 1 of the Fourth Superseding
Indictment. They contend that Count 1 fails to sufficiently
allege an indictable offense. The legal ...