By Chris Villani

Law360 (April 20, 2020, 8:05 PM EDT) -- Insys Therapeutics Inc. founder John Kapoor took exception to being the lone convicted company executive who the government believes should not have his prison sentence delayed due to the COVID-19 pandemic, saying he is older and more at-risk than his fellow defendants and still not a flight risk.

Federal prosecutors assented to a 60-day delay for the self-surrender dates of Michael Gurry, Joe Rowan, Sunrise Lee and Rich Simon, all of whom were convicted in Massachusetts federal court along with Kapoor of a racketeering scheme to bribe doctors to prescribe Insys' opioid spray and lying to insurance companies to get them to pay for the drug.

But the government opposed a similar request by the 76-year-old Kapoor, who was sentenced alongside his co-conspirators in January but isn't slated to turn himself in until May 19. The government instead asked to impose unspecified additional restrictions on his continued release, ignoring the fact that multiple judges have already found he is not a threat to flee the country, his attorneys argued Monday.

"Since his arrest in October 2017, Dr. Kapoor has complied with every single court directive and condition of his release" the motion argues. "The idea that Dr. Kapoor would now attempt to flee — in the midst of a pandemic where travel is limited and would expose him to grave health risks — is baseless."

Fleeing to his native India, Kapoor notes, would require getting a passport, taking multiple lengthy flights and landing in one of the world's most densely populated nations which is also struggling with the pandemic and in which he could not do the kind of social distancing he is able to currently at his home in Arizona.

Kapoor — who was sentenced to 66 months in prison — also notes that he is nearly 77 and takes medication for hypertension, putting him at a very high risk of death if he were to contract COVID-19. As others in his position have done, Kapoor noted how difficult it is to properly socially distance in prison and cited a report quoting a prison workers union official who said the Bureau of Prisons "is in chaos" trying to manage the crisis.

Both U.S. District Judge Allison D. Burroughs and the magistrate judge who initially presided over Kapoor's case deemed he was not a flight risk. Judge Burroughs immediately denied a bid by prosecutors to have Kapoor hauled away the day he was sentenced, saying Kapoor has "complied with every deadline and condition that's been imposed on him until this point, and I don't have any reason to think that he's going to behave any differently now [that] there's been a verdict rendered."

The same day Kapoor made his case to extend his surrender date, a pair of his convicted former underlings made additional pitches to the First Circuit to delay prison until after their appeals, arguing they can show the government's case is tainted by improper evidence and guilt by association.

Gurry and Rowan told the panels their appeals present questions of law that very well may result in a new trial. As a result, Gurry argues he should not begin serving his 33-month prison term until the First Circuit weighs in and Rowan said he shouldn't go to prison for his 27-month stretch until the appeals court signs off.

In separate briefs, they pushed back against the government's claim that their appeal raises no substantial legal questions. Gurry has pointed to the fact that the Controlled Substances Act predicate of the racketeering charge was thrown out after the verdict.

Since he wasn't convicted on that predicate, but was convicted on other fraud predicates, Gurry claims to be the victim of "spillover prejudice." Prosecutors have said the nuanced verdict shows the jury clearly understood the case, but Gurry said Monday that argument doesn't make sense.

"If the court accepts the government's logic, then the government could tack on more serious charges in any case, introduce highly emotional testimony relevant to those charges and designed to tug at jurors' heart strings, make no effort to connect that testimony to the defendant, and then point to the inevitable split verdict as evidence that the defendant has no cause for complaint," Gurry's brief argues.

Gurry ran the Insys Reimbursement Center, or IRC, which the government says was a call center used to mislead and tell outright lies to insurance companies so that, after bribed doctors prescribed Subsys, the company's fentanyl spray, the insurers would pay for it.

Another flaw with the government's case, Gurry says, is that Assistant U.S. Attorney Fred Wyshak improperly argued during rebuttal that Gurry "is responsible for the IRC" and "bears the responsibility" as a "corporate officer." That alone is enough for a new trial, the former Insys executive claims.

Rowan, meanwhile, argues he had nothing to do with the IRC fraud and therefore the case against him is mere guilt by association.

"The government's argument boils down to this: It proved that Rowan specifically intended the IRC insurance fraud scheme because it offered evidence that other Insys employees (in other divisions, both geographically and operationally remote from Rowan) either committed insurance fraud or may have been aware of it," he argued. "This is not proof beyond a reasonable doubt."

With major questions lingering, the executives say it's not right to send them to prison until the First Circuit has a chance to weigh in. Judge Burroughs has already ruled that the executives' appeals, including that of Kapoor, are unlikely to succeed and therefore the prison terms should not be postponed until their completion.

The government opposes any delay to wait for the appeal, though it did not oppose requests to delay surrender dates aside from Kapoor's.

A government spokeswoman and counsel for Kapoor, Gurry and Rowan either did not respond to comment requests or declined comment.

The government is represented by Mark T. Quinlivan of the U.S. Attorney's Office for the District of Massachusetts.

John Kapoor is represented by Martin G. Weinberg of Martin Weinberg Law PC, as well as Beth A. Wilkinson, Kosta S. Stojilkovic and Chanakya A. Sethi of Wilkinson Walsh LLP.

Michael Gurry is represented by Tracy A. Miner and Megan A. Siddall of Miner Orkand Siddall LLP.

Joseph A. Rowan is represented by Michael Kendall, Karen Eisenstadt and Alexandra I. Gliga of White & Case LLP.

The cases are U.S. v. Gurry, case number 20-1335, and U.S. v. Rowan, case number 20-1336, in the U.S. Court of Appeals for the First Circuit.

--Additional reporting by Brian Dowling. Editing by Michael Watanabe.

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