United States v. Richard Davis

── United States v. Richard Davis ── Court: Court of Appeals for the Fourth Circuit Date: April 24, 2026 Category: General USCA4 Appeal: 25-4093 Doc: 66 Filed: 04/24/2026 Pg: 1 of 19 UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 25-4093 UNITED STATES OF AMERICA, Plaintiff – Appellee, v. RICHARD DAVIS, Defendant – Appellant. Appeal from the United States District Court for the Eastern District of Virginia, at Richmond. John A. Gibney, Jr., Senior District Judge. (3:23−cr−00135−JAG−1) Argued: February 12, 2026 Decided: April 24, 2026 Before DIAZ, Chief Judge, and WILKINSON and HEYTENS, Circuit Judges. Reversed, vacated, and remanded by unpublished opinion. Chief Judge Diaz wrote the opinion, in which Judge Heytens joined. Judge Wilkinson wrote a dissenting opinion. ARGUED: Robert James Wagner, ROBERT J. WAGNER PLC, Richmond, Virginia, for Appellant. Shea Gibbons, OFFICE OF THE UNITED STATES ATTORNEY, Richmond, Virginia, for Appellee. ON BRIEF: Erik S. Siebert, United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Richmond, Virginia, for Appellee. Unpublished opinions are not binding precedent in this circuit. USCA4 Appeal: 25-4093 Doc: 66 Filed: 04/24/2026 Pg: 2 of 19 DIAZ, Chief Judge: Richard Davis, the former director of a mental health counseling company, appeals his convictions for two counts of health care fraud. After a bench trial, the district court found Davis guilty of scheming to defraud Medicaid by overbilling for counseling services on two specific dates. But the evidence was insufficient to prove that the bills submitted on those two dates were actually false. So we must reverse the convictions. I. A. Davis owned and directed Innovative Family Services, LLC, a Medicaid-funded mental health service provider for at-risk youth. As the clinical director, Davis was “responsible for assuring that everyone within the company [was] complying [with] Medicaid billing guidelines.” Joint Appendix (J.A.) 777. Innovative ran several programs, including therapeutic day treatment, which was an after-school program to help children with emotional and behavioral issues. During day treatment, licensed counselors provided individual and group counseling and helped at-risk youth work on “problem-solving, anger management, community responsibility, increased impulse control, [and] appropriate peer relations.” J.A. 173. Innovative could seek reimbursement from Medicaid for certain day-treatment activities. As relevant here, the Department of Medical Assistance Services, which administers Virginia’s Medicaid program, permitted reimbursement for face-to-face 2 USCA4 Appeal: 25-4093 Doc: 66 Filed: 04/24/2026 Pg: 3 of 19 treatment, some planning activities, and “care coordination,” which is the “sharing of information among [the] health care providers . . . involved with an individual’s health care.” J.A 143, 173–74. But time spent transporting recipients, documenting contacts, and monitoring behavior during class wasn’t reimbursable. The Department required counselors to bill their day treatment in “units.” J.A. 175. Counselors could bill one unit when they provided between 2 and 2.99 hours of reimbursable services, two units when they provid