The U.S. Court of Appeals for the Ninth Circuit has handed a legal victory to Tamara Yvonne Motley, vacating a portion of her prison sentence related to identity theft. While Motley’s conviction for orchestrating a massive ten-year healthcare fraud remains intact, the court ruled on Tuesday that her use of relatives’ names to run her businesses did not meet the high legal bar for “aggravated identity theft.”
The decision stems from a scheme where Motley’s companies, Action Medical Equipment and Supply and Kaja Medical Equipment, billed Medicare for over $24 million in unnecessary or unprovided medical gear, such as power wheelchairs. Between 2006 and 2016, Medicare paid out roughly $13.1 million to the firms.
The Identity Theft Deadlock
At the center of the appeal was 18 U.S.C. § 1028A(a)(1), a statute that adds a mandatory two-year prison term for anyone who uses another person’s identification “during and in relation to” a felony. Motley’s companies were officially enrolled in Medicare under the names of her mother and nephew.
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Because Motley managed the daily operations and submitted the fraudulent claims while her relatives remained largely uninvolved, the government argued she had “used” their identities to commit the fraud.
However, the Ninth Circuit found that the government’s theory failed to keep up with recent Supreme Court precedent.
The “Crux” of the Crime
The court relied heavily on the 2023 Supreme Court decision Dubin v. United States, which significantly narrowed what qualifies as aggravated identity theft. Under the Dubin standard, the misuse of an identity must be at the “crux” of the criminality, rather than just an “ancillary feature” of how the bills were processed.
The Ninth Circuit panel, led by Judge Jay Bybee, determined that the true heart of Motley’s fraud was lying about the medical necessity of the equipment, not lying about who owned the companies.
Key points from the ruling included:
- No Deception in Identity: The court noted that Motley’s relatives had given her power of attorney to run the businesses. There was no evidence she stole their information or used it without permission.
- Authorization vs. Theft: Because Motley was an authorized agent of the companies, her act of submitting claims was technically lawful in its method; the fraud lay solely in the content of the claims (billing for services not rendered).
- Lack of Necessity: The government failed to prove that Motley couldn’t have enrolled in Medicare under her own name or that using her relatives’ names was “critical to the success” of the scam.
While this ruling removes the mandatory two-year “stacking” sentence for identity theft, Motley is not walking free. Her underlying convictions for healthcare fraud and money laundering—which involved millions of dollars in kickbacks and fabricated delivery tickets—were not challenged in this appeal.
The case now heads back to the U.S. District Court for the Central District of California, where a judge will determine a new total sentence for Motley without the aggravated identity theft enhancement.
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