Federal prosecutors filed a motion late Friday requesting that a U.S. district judge lift an order directing the government to grant immunity to a surgeon tied to the investigation of personal injury attorney Noel Gage.
First Assistant U.S. Attorney Steve Myhre stated in the motion that granting immunity to spine surgeon Mark Kabins would damage its ongoing investigation into a network of doctors and lawyers who the government claims conspired to defraud clients and line their own pockets.
"Trial testimony by Kabins under grant of immunity would seriously jeopardize the possibility of charging Kabins," Myhre wrote.
Last month, a jury deadlocked on charges that Gage conspired with self-proclaimed medical consultant Howard Awand and Las Vegas physicians to inflate medical costs and boost legal settlements while protecting the participating surgeons from medical malpractice lawsuits.
Gage's legal team claims Kabins' testimony will contradict that of Dr. John Thalgott, a former partner who testified on behalf of the government after being granted immunity.
On Monday, U.S. District Judge Justin Quackenbush said that if the government failed to offer Kabins immunity by Friday, he would dismiss the charges against Gage. A new trial for Gage is slated to begin May 27. It was unclear late Friday whether Quackenbush would follow through with his threat after receiving the government's 25-page motion.
An assistant to Thomas Pitaro, Gage's attorney, said Pitaro does not comment on pending cases.
"We're still very pleased with Judge Quackenbush's original ruling, and we will wait to see how it develops," said attorney David Chesnoff, who represents Kabins.
The charges against Gage stem from a case involving Melodie Simon, who in August 2000 went to Sunrise Hospital and Medical Center and had an operation to replace screws holding together fused lumbar discs. She expected to spend three days in the hospital.
But Simon, then 41, began suffering weakness in her legs and testified that, panicked about her worsening condition, she alerted hospital staff. A sac protecting her spine had been punctured, causing internal bleeding that ultimately resulted in permanent paralysis.
Thalgott, one of the surgeons who performed the operation, left town for a fishing expedition immediately following the procedure. Kabins, the other physician, waited 11 hours to perform an emergency operation to release the pressure from Simon's back, according to the government.
The government claims Kabins was a member of the network of doctors and lawyers who shared kickbacks from their scam. He is considered a target of the investigation but has yet to be indicted on any criminal charges.
Simon hired Gage to determine what went wrong and weigh the possibility of filing a lawsuit against those responsible. Gage told Simon that her case was solid and could render a settlement of between $8 million and $12 million, according to the government. Prosecutors said Kabins was an easy target.
"The government contends and offered testimony at the first trial, including that of various experts, that Ms. Simon's paralysis was the result of medical negligence on the part of Dr. Kabins," according to court documents filed by prosecutors.
But Gage didn't pursue medical malpractice lawsuits against Kabins or Thalgott. Instead, he successfully sued anesthesiologist Dan Burkhead and Sunrise Hospital for a total of $2.3 million. After attorneys fees and associated costs, Simon received $1.3 million, an amount that she testified will not cover the cost of her ongoing medical needs.
In exchange for backing off the surgeons who worked closely with Awand, according to the government, Awand referred a lucrative case to Gage that eventually resulted in an $18 million settlement.
Thalgott testified that he, Kabins and Gage met secretly in 2001 to devise a plan to blame Burkhead for Simon's tragic condition. The surgeons agreed to tailor their testimony at Simon's trial to match the strategy, Thalgott said.
Kabins approached the government in February, just days before Gage's three-week trial commenced and a month after he was informed that he was a target in the investigation. Kabins signed a proffer agreement with prosecutors, meaning his statements cannot be used against him directly if he is indicted and goes to trial. The government can use the information only to further its investigation.
Kabins told authorities that if Gage had filed a lawsuit against him, he would have "fought it tooth and nail and would have won the case against him," court documents say. Kabins also told federal authorities that Gage never guaranteed during the secret meeting that he would not file malpractice lawsuits against Kabins and Thalgott.
In his order, Quackenbush acknowledged that "immunity is ordinarily left to the discretion of the prosecutor," but he went on to say that the court can step in if it is believed a witness who could support the defense is prevented from testifying by the government.
"Principles of fairness and justice dictate that the defendant is entitled to have the testimony of Dr. Kabins presented to the jury," Quackenbush wrote.
The government plans to appeal Quackenbush's ruling if he fails to drop his order.
Prosecutors offered protection to Thalgott and Dr. Ben Venger, a surgeon who admitted on the stand that he committed perjury in past trials, because they approached the government and requested immunity in 2006. Neither was considered a target or subject of the investigation.
Kabins became aware of the investigation in 2005 after receiving a grand jury subpoena. He was informed that he was a target in January. The request for immunity was filed in April. In addition, Thalgott and Venger admitted to wrongdoing, according to the motion, while Kabins has not.
According to the government's motion, it is extremely rare for a judge to order immunity for the target of an ongoing investigation. In the few cases when it has occurred, the U.S. Court of Appeals has overturned the decision.
"The Ninth Circuit clearly and unequivocally recognizes that the limited exception for immunizing a defense witness does not apply when the potential witness is himself a target of an investigation into the very conduct about which he would testify," the motion says.
In 16 published decisions and in more than 30 unpublished opinions, the Ninth Circuit did not once require the government to grant immunity, according to the motion.
The government claims Kabins has a joint defense agreement with Gage and declined during his meeting with federal agents to discuss information he received from or provided to Gage.
Contact reporter Adrienne Packer at email@example.com or 702-384-8710.