Attorney will face new trial

Personal injury attorney Noel Gage joined some 200 friends and associates last year for a victory party after his federal fraud case was dismissed.

After learning Thursday that his criminal case had been reinstated, Gage denied that the bash at Red Rock Resort -- billed on the invitation as a "celebration of justice" -- was held prematurely.

"But when my acquittal comes this time around, there will be reason for a second victory party," the Las Vegas lawyer said.

The 9th U.S. Circuit Court of Appeals in San Francisco issued a brief decision Thursday that revives the case against Gage and medical consultant Howard Awand. They are accused of conspiring to cheat injured clients by inflating medical costs, protecting doctors from malpractice lawsuits, and sharing kickbacks from legal settlements.

"This is a big win for the government in a very important case," said Greg Brower, the U.S. attorney for Nevada.

Gage's trial resulted in a hung jury in March 2008. Senior U.S. District Judge Justin Quackenbush of Spokane, Wash., who presided over the Las Vegas trial, later dismissed the charges against Gage and Awand after prosecutors refused to grant limited immunity to spine surgeon Mark Kabins, described at the time as a target of the fraud investigation.

Prosecutors had granted immunity to two other doctors, Benjamin Venger and John Thalgott, in exchange for their testimony at Gage's trial. Although the defense subpoenaed Kabins, he exercised his Fifth Amendment right against self-incrimination and refused to testify. Defense attorneys argued that Kabins' testimony would have contradicted Thalgott's.

Kabins was indicted earlier this year on conspiracy and fraud charges.

Prosecutors appealed Quackenbush's decision to dismiss the charges against Gage and Awand, and a three-judge panel heard arguments on the matter Aug. 11.

"It's not often that a panel of the 9th Circuit will hand down a unanimous decision within two weeks of the arguments of a case and need only eight lines to articulate their reasons why the District Court was wrong," Brower said. "They clearly did not have any trouble seeing the case the way we saw it."

The panel ruled that due process compels immunity "only for defense witnesses who will offer testimony that directly contradicts the testimony of a government witness" who has been given immunity.

"Direct contradiction means more than just different subjective interpretations of the same facts," according to the decision, which concludes that Kabins would not have directly contradicted a government witness who received immunity.

Prosecutors argued that Kabins' testimony would not contradict Thalgott's, but Brower said they also made the "bigger-picture argument" that a trial court cannot force the government to grant immunity to the target of an investigation.

"The 9th Circuit chose not to even address that," the U.S. attorney said.

Gage and Los Angeles attorney Harland Braun, who represents Awand, said they have no plans to seek a rehearing from the full appeals court.

"I am very anxious to get to trial immediately to get the acquittal that I'm entitled to," Gage said.

The 71-year-old lawyer said he was disappointed by the ruling of the three judges.

"I am not criticizing their decision, because I understand their role as appellate judges," he said. "However, had they been the trial judge, they would not have ruled the way they did. But they're appellate judges, and they can only look at the record, the paper that's in front of them, which is quite different from real, live human beings in a trial circumstance."

Kabins is scheduled to go to trial Nov. 3 before U.S. District Judge Robert Jones. Braun said he assumes the surgeon's case will be transferred to Quackenbush and that all three defendants will be tried together.

"It's all the same case," Braun said.

The lawyer said a joint trial will render the immunity issue moot, because "there's no way that Kabins will not testify" at his own trial.

"As it turns out, we're going to get what we want," Braun said.

Kabins' lawyer, David Chesnoff, offered no assurances, saying, "The cases have not been consolidated. Dr. Kabins is charged differently than Mr. Awand and Mr. Gage, and it would be presumptuous to predict the future."

Chesnoff said his client "continues to adamantly maintain his complete innocence." The lawyer also said he read the 9th Circuit ruling and was pleased that the court "recognized that defense immunity is available."

"I don't think it's appropriate for me to comment beyond that," he said.

Gage said he expects his case to be consolidated only with Kabins'.

"The Awand case has significantly more items in it," Gage said.

Gage also said he expects Kabins to testify. When asked whether he would testify, Gage said he would follow the advice of his attorneys, as he did when he opted not to address the jury at his first trial.

"I'd like to testify," he said. "I'm anxious to testify."

When asked about his client, Braun said, "Of course Awand will testify."

The government's case centers on Melodie Simon, who became a paraplegic after Thalgott and Kabins operated on her in 2000. Gage represented Simon when she sued for medical malpractice.

Rather than suing Thalgott and Kabins for damages prosecutors estimated would have been between $8 million and $10 million, Gage pursued anesthesiologist Dan Burkhead, and Simon received a $2 million settlement.

Thalgott told jurors that he and Kabins held a secret meeting with Gage to protect themselves from a medical malpractice lawsuit and hatch a plan to blame Burkhead for Simon's injuries.

The State Bar of Nevada recently filed an ethics complaint against Gage, who has been licensed to practice law in Nevada since 1997. It claims he split about $1.3 million in fees with Awand, but Gage called the allegation "absolutely false."

Nevada has a rule that bars attorneys from splitting fees with nonlawyers.

"Every payment that ever went out of my office was lawful, appropriate and to fairly compensate for services performed on the particular matter," Gage said.

A bar spokesman said no formal hearing on the ethics complaint has been scheduled.

Gage said he has written a novel titled "Reality -- Prosecutors' Dirty Tricks" and is looking for a publisher. He also wants to bring the story to the big screen.

Braun said Awand and his wife are operating bed-and-breakfast facilities in Vermont and Indiana.

Contact reporter Carri Geer Thevenot at cgeer@reviewjournal.com or 702-383-0264.