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United States v. Med. Therapy Scis., Inc. - 583 F.2d 36 (2d Cir. 1978)


Fed. R. Evid. 608(a) provides that the credibility of a witness may be attacked or supported by evidence in the form of opinion or reputation, but subject to these limitations: (1) the evidence may refer only to character for truthfulness or untruthfulness, and (2) evidence of truthful character is admissible only after the character of the witness for truthfulness has been attacked by opinion or reputation evidence or otherwise.


After a jury trial, appellants Stanley Berman and his company, Medical Therapy Sciences, Inc. ("Medical Therapy"), were convicted of having filed false claims to obtain Medicare payments during the period of 1971-1976, and of having conspired to do the same along with unindicted co-conspirators, including Berman’s former trusted employee and personal intimate, Barbara Russell. Berman was also convicted of perjury in connection with the grand jury's investigation of Medicare abuses. Berman's Medical Therapy, was a Connecticut company, which had a branch, Respiratory Specialties, that operated out of New York. Under the Medicare program, Medical Therapy was to be reimbursed, ultimately by the Department of Health, Education and Welfare, for a certain percentage of the cost of supplies to Medicare patients. However, reimbursable costs vary from one insurance carrier to another, and the place from which the service is rendered determines which carrier is to pay, and which carrier's payment schedule is to apply. Under the rules, if Berman's Connecticut company supplied equipment to a Connecticut Medicare patient, the claim should have been submitted to the Connecticut insurance carrier, not to the New York carrier. At trial, Berman was shown to have devised a scheme to wrongfully obtain payments from both the Connecticut and New York carriers. Aside from double billing the two companies for the same patients, Berman's fraud also consisted of claiming for more expensive equipment than had actually been provided to patients and billing for supplies neither delivered nor needed by the patients. On appeal, Berman claims error with respect to the conspiracy and perjury counts, and he argues that the trial court erred in permitting the Government to present character evidence in its rebuttal case to support Barbara Russell's credibility.


Did the trial court err in permitting the Government to present character evidence in its rebuttal case to support Barbara Russell's credibility?




The Court held that the testimony of an unindicted co-conspirator fairly inferred the existence of an agreement, although there was no proof of a formal agreement. Stanley Berman and Medical Therapy Sciences, Inc.  also contended that character evidence was wrongly received under Fed. R. Evid. 608(a) to support the veracity of the unindicted co-conspirator. The government on direct had elicited testimony regarding the witness's prior convictions and, after a cross-examination limited to matters brought out on direct, had presented character witnesses to bolster her credibility. The Court held that the district court did not abuse its discretion in allowing the character witnesses. The district court's proximity to the situation allowed it to make the determination of when, and by whom, an attack was made. The government elicited the prior convictions as background information, not for impeachment; thus, it did not attack its own witness. The cross-examination could have been characterized as an attack on veracity.

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