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State v. Malik

December 30, 2003

STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT,
v.
MOHAMMAD SALEEM MALIK D/B/A HAJI SALEEM, A/K/A MOHAMMAD SALEEM, DEFENDANT-APPELLANT.



On appeal from the Superior Court of New Jersey, Law Division, Middlesex County, Docket No. SGJ-429-00-10.

Before Judges Newman, Parrillo and Hoens.

The opinion of the court was delivered by: Parrillo, J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued November 17, 2003

At issue is the interpretation of N.J.S.A. 2C:21-9(c), which defendant contends contains a criminal proscription against corporate misconduct that is unconstitutionally vague as applied to individuals other than corporate officers and directors at whom, he maintains, the statute is exclusively directed. We disagree and find no constitutional infirmity in the provision in issue, the clear language of which, we hold, reaches defendant's conduct in this case.

Defendant Mohammad Saleem Malik and others were indicted for second-degree conspiracy to commit Medicaid fraud, N.J.S.A. 30:4A-17(c), N.J.S.A. 2C:5-2, and N.J.S.A. 2C:21-9(c) (count one); third-degree Medicaid fraud, N.J.S.A. 30:4D-17(c), N.J.S.A. 2C:2-6, and N.J.S.A. 2C:2-7 (count two); and second-degree misconduct by a corporate official, N.J.S.A. 30:4D-17(c), N.J.S.A. 2C:2-6, and N.J.S.A. 2C:21-9(c). Evidence before the grand jury established that defendant, his brother, co-defendant, Iftikhar Hussain, and another co-defendant, Abdul Hafeez Raja, owned and controlled Venditti Clinical Laboratory, Inc. (V.C. Lab), a Medicaid provider that performed diagnostic tests on blood samples and received reimbursement from the government-funded health care program for these services. The proofs also demonstrated that for nine months in 1994 and 1995, defendant and co-defendants operated V.C. Lab in furtherance of a kickback scheme. Specifically, defendant and his cohorts used payments received from the Medicaid program for performing diagnostic blood tests to fund kickbacks to medical clinics and laboratories that provided blood samples to V.C. Lab for testing, in exchange for continuing to submit samples. The kickbacks totaled $346,980, consisting of $233,595 to fictitious accounts operated by Zahid Ilyas, a cooperating witness, and $113,385 to King Consultants (King) a company owned and operated by two other cooperating witnesses, Shakir Siddiqui and Mohammed Arif, who, through King, owned Specialty Clinical Laboratory and Precise Medical Laboratory, both suppliers of blood specimens to V.C. Lab. There was no competent proof, however, that defendant held any corporate office in V.C. Lab.

Defendant moved pre-trial to dismiss count three and also to dismiss the part of count one that related to count three, on the ground that N.J.S.A. 2C:21-9(c) did not apply to him because it covers only corporate officers and directors, and he held neither position. The court denied the motion.

Eventually, defendant and the State entered into a plea agreement wherein defendant would plead guilty to counts two and three in exchange for the State's recommendation to dismiss count one; to treat the second-degree crime alleged in count three as a third-degree offense for purposes of sentencing; and to impose concurrent"flat sentences" on each count without a parole bar and a fine not to exceed $5,000. Defendant also agreed"to be debarred from Medicaid and related programs for 5 years." Moreover, defendant reserved the right to appeal the denial of his motion to dismiss.

At the plea hearing, defendant admitted the occurrence of the activities on which the indictment was based and his participation in them. In response to the inquiry"did you use[,] control[,] or operate" the corporation in those illegal activities, defendant acknowledged that he had. Accordingly, defendant's guilty plea was accepted.

Consistent with the plea bargain, defendant was sentenced to a five-year term on count three and a concurrent three-year term on count two. Appropriate fees and a $5,000 fine were also imposed. The judgment of conviction also recited that"[d]efendant is barred from any activity in [the] Medicaid Program" without indicating, however, that the debarment period, according to the plea agreement, was limited to five years.

Defendant now appeals, repeating his argument that N.J.S.A. 2C:21-9 imposes liability only on corporate officers and directors, and adding new claims that the statute is unconstitutional, all issues of first impression in this State. He also asserts errors in sentencing. Specifically, the issues presented for our consideration are:

I. N.J.S.A. 2C:21-9 REQUIRES AN OFFENDER THEREOF TO BE A CORPORATE OFFICIAL: AS DEFENDANT-APPELLANT WAS NOT A CORPORATE OFFICIAL, HIS CONVICTION UNDER THAT STATUTE CANNOT BE SUSTAINED.

II. DEFENDANT'S CONVICTION UNDER N.J.S.A. 2C:21-9 VIOLATES DUE PROCESS. (U.S. CONST. AMEND. V, XIV; N.J. CONST. OF 1947 ART I, §10).

III. EVEN IF N.J.S.A. 2C:21-9(C) IS INTERPRETED TO APPLY TO ALL PERSONS AND NOT JUST CORPORATE OFFICIALS, ITS ENACTMENT VIOLATED N.J. CONST. ART. IV, SEC. 7, PAR. 4 AND DEFENDANT'S CONVICTION THEREUNDER CANNOT BE UPHELD.

IV. THE SENTENCE IMPOSED WAS MANIFESTLY EXCESSIVE AND THE LOWER COURT ERRED IN ITS FINDINGS OF THE APPLICABLE STATUTORY AGGRAVATING AND MITIGATING FACTORS.

V. THE LOWER COURT, CONTRARY TO THE TERMS OF THE PLEA AGREEMENT IT ACCEPTED, ERRONEOUSLY ISSUED A JUDGMENT OF CONVICTION STATING DEFENDANT-APPELLANT WAS BARRED FROM ANY ...


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