All 46 charges remain intact against three former healthcare executives who conspired to steal $13 million from hospital districts in Tulare and Lone Pine, Calif.; case will continue in January
TULARE – The case against three former healthcare executives charged with conspiring to steal more than $13 million from hospital districts in Tulare and Lone Pine, Calif. can finally move forward following a judge’s decision.
On Nov. 16, Tulare County Superior Court Judge Michael Sheltzer denied demurrers filed by former Healthcare Conglomerate Associates (HCAA) CEO Yorai “Benny” Benzeevi, CFO Alan Germany, and counsel Bruce Greene. A demurrer is a plea for the judge to dismiss the complaint, not necessarily because the complaint is untrue, but because there is no legal basis for the filing. Demurrer hearings are held before a judge without a jury to determine if the complaint is on solid legal grounds. The judge alone will then decide if the complaint, or at least parts of it, must be amended before moving to the trial process beginning with an arraignment or dismissing the complaint or parts of it. The demurrers have been in process for the last year and have spanned three judges with Greene filing his on Aug. 19, 2020, Germany filing his on Sept. 1, 2020, and Benzeevi on Jan. 6, 2021. The actual hearing did not begin until Oct. 20, 2021 in Department 5 of the Tulare County Superior Court.
It is alleged the trio of former HCCA executives used control of the Tulare Regional Medical Center (TRMC) and influenced the Tulare Local Health Care District board locally and Southern Inyo Health Care District in Lone Pine, Calif. to enrich themselves through the improper use of taxpayer and private loans, and other public integrity crimes. HCCA was able to get away with it for three years from 2015 to 2017 by promising to save the cash-strapped hospitals all while stealing from the other and then pocketing the money.
The case against the three men was originally filed in August 2020 as the largest investigation ever conducted by Tulare County District Attorney’s Office. The three-year investigation spanned 70,000 miles to eight California counties, six states (Arizona, Idaho, Maine, Georgia, Colorado, Michigan) and Washington, D.C. while serving 58 search warrants. Ward described the investigation as the largest ever conducted by his office including investigators, support staff and prosecutors dedicating over 13,500 hours collecting and analyzing 30 terabytes of digital evidence, the information equivalent to 45,000 standard CD-ROMs.
The men face a combined 40 felony and six misdemeanor charges including misappropriation of government funds, conflicts of interest, money laundering, embezzlement, theft, and failure to disclose funds intended to influence a political campaign. The intricate scheme orchestrated by the three men involved stealing medical equipment, political favors, falsifying documents and even a connection to a former Israeli private intelligence agency.
Judge Sheltzer denied the demurrer on all 46 counts by clumping them into six main categories: embezzlement and grand theft, conflict of interest, conspiracy, money laundering, forgery and using an official position for personal gain. In his ruling, the judge said most demurrers are filed after a preliminary hearing is held to determine which evidence will be admitted into trial.
“While the standard for demur is the same whether pre or post probable cause hearing, the evidence adduced at such a hearing informs and provides notice to the defense,” Judge Sheltzer wrote. “In the court’s view, many of the defense claims may be cured at the preliminary hearing …”
The judge did note the district attorney could “clean up” the pleadings in a dozen of the charges by providing more detail. “The People are urged, but not ordered to amend those less specific counts to provide greater specificity and notice to the defense,” Judge Sheltzer wrote.
Now that the demurrer process has ended, the normal series of events in a criminal trail can begin. An arraignment for all three men to enter their pleas against their charges is tentatively scheduled for Jan. 12, 2022.
Some of the defense rests
When the three former hospital executives next appear in court, Benzeevi will be without the headline-grabbing attorneys he hired earlier this year. Both Ronald Sullivan and Jose Baez withdrew from the Benzeevi’s defense team on Oct. 18.
“This motion is on the ground that the client has knowingly and freely assented to termination of the representation,” the motion to withdraw as counsel reads.
Sullivan is a Harvard Law professor who reached a settlement for the family of Michael Brown, the unarmed black teenager shot and killed by a white officer, with the city of Ferguson, Mo. Brown’s killing in August 2014 set off protests and riots in Ferguson and St. Louis, and then cities across the country, which many consider to be the catalyst for the Black Lives Matter movement.
Baez successfully acquitted Casey Anthony, the Orlando, Fla. woman accused of drowning her 2-year-old daughter in July 2008, after convincing a jury that her daughter drowned accidentally and then lied about the death to protect her father, who they claimed had disposed of the body, in unproven claims that he sexually abused Casey as a child.
Both men were part of the legal team that helped acquit New England Patriots tight end Aaron Hernandez in a double murder case in 2017 and more recently were part of the defense team that represented disgraced movie mogul Harvey Weinstein who was convicted last February of raping woman in 2006 and 2013. Baez and Sullivan were part of the second team of defense attorneys Weinstein hired after parting ways with famed New York defense attorney Benjamin Brafman in early 2019 but were not part of the defense when the trial closed more than a year later. The case cost Sullivan his position at Harvard Law School after students began protesting his involvement. Harvard did not renew appointments for Sullivan or his wife, Stephanie Robinson, as faculty deans and their previous appointments expired in June 2019.
Benzeevi will still be represented by Oliver W. Wanger and Peter Michael Jones of Wanger Jones Helsley firm in Fresno, Calif. Wanger is a former U.S. District Court judge who made the top 100 list of 2019 Northern California Super Lawyers at his firm and is a former judge. Jones is a seasoned public defender who spent 25 years with the Fresno County Public Defender’s Office. While he specializes in white collar crime and litigation, Jones is best known for some of the most publicized jury trials in Fresno County history. He was lead defense counsel for Ramadan Abdullah, the mentally ill man who shot and killed a Fresno County Sheriff’s deputy in 2001, Dana Ewell, the man who murdered his millionaire parents and sister in 1992, and Fresno’s worst mass murder Marcus Wesson, who killed two of his daughters and seven of their children, who he fathered through years of molestation and rape, in 2004.
Greene is still being represented by Jeffrey Steinfeld and David Scheper of Scheper Kim & Harris, LLP in Los Angeles. The firm specializes in white collar criminal defenses, according to its web site sheperkim.com, and has been recognized as a top white collar firm by the Chambers USA Guide.
Germany is still being represented by Kevin P. Rooney of Hammerschmidt Law Corporation in Fresno. The former Tulare County deputy DA turned federal prosecutor specializes in criminal defense in both state and federal cases in California.
If convicted, each defendant potentially faces a significant state prison commitment. The specific amount of prison time as to each defendant varies due to the nature of the charges and California sentencing rules; however, on the most serious charge (money laundering) Benzeevi is potentially facing 13 years while Greene and Germany are each facing up to 9 years. Greene and Germany have potential maximum sentences of well over a decade should they be found guilty of all of the charges and allegations, and Benzeevi is facing in excess of four decades.