Felony fraud convictions will stand against a former long-term care CEO after a court ruled that an attorney conflict of interest did not affect his case.
Former American Senior Communities CEO James Burkart in 2019 sought to have his convictions for conspiracy to commit fraud, conspiracy to violate the healthcare anti-kickback statute, and money laundering tossed on the grounds that his legal team from the Indianapolis-based firm Barnes & Thornburg failed to disclose a “profound conflict of interest.”
The firm had performed extensive legal and lobbying work for one of the principal victims in the case, Health & Hospital Corp. of Marion County.
Back then, a federal judge denied his motion to throw out Burkhart’s felony fraud convictions, ruling that his law firm’s conflict of interest did not adversely affect his defense in the $19.4 million fraud case.
On Monday, the 7th Circuit Court of Appeals agreed that although Burkhart’s attorneys had a conflict of interest, it did not affect his case.
“The district court was right to conclude that nothing in the record shows that Barnes & Thornburg improperly shaded its advice to induce Burkhart to plead guilty,” Circuit Judge Michael Scudder wrote for the court. “To the contrary, the advice reflected a reasonable response to the dire circumstances facing Burkhart. Perhaps above all else, Barnes & Thornburg clearly saw the insurmountable hurdle Burkhart faced in the prosecution — the strength of the government’s case.”
Burkhart was sentenced in 2018 to 9 1/2 years in prison for his part in what prosecutors described as a “massive fraud, kickback and money-laundering conspiracy.” The senior living and care company leader and others were found guilty of illegally using funds for luxury purchases over a six-year period.
Burkhart pleaded guilty to three federal felony offenses, including conspiracy to commit fraud, conspiracy to violate the healthcare anti-kickback statute and money laundering. In exchange, the government dropped 17 counts of an original 32-count indictment against him.
