Spine surgeon pleads guilty to concealing fraud

By Cara McCoy

Monday, Nov. 23, 2009 | 3:33 p.m.

A Las Vegas spine surgeon has pleaded guilty to concealing fraud committed by his two codefendants and will be sentenced to five years of probation and six months of home detention, said U.S. Attorney Daniel G. Bogden of Nevada. Under the terms of the plea, the doctor is also required to pay $3.5 million in restitution to a victim who became paralyzed after surgery.

Dr. Mark B. Kabins, 49, who was facing charges of fraud and conspiracy for his role in an alleged scheme involving local lawyer Noel Gage and medical consultant Howard Awand, entered a plea of guilty to one count of misprision of felony in front of U.S. District Judge Justin L. Quackenbush. To prove the charge, under federal law prosecutors must show that a defendant knew that another person committed a felony and did not as soon as possible notify appropriate authorities about the crime.

Kabins is accused of falsifying medical records and conspiring with Gage and Awand to defraud a woman who was paralyzed after routine back surgery in 2000.

"In this plea agreement, Dr. Kabins acknowledged that he used Awand to corruptly influence Gage not to sue him, and that he concealed the crime that Awand and Gage thereafter committed,” Bogden said in a statement. “The Department of Justice will prosecute those who intentionally and actively seek to conceal criminal offenses from law enforcement."

Under the agreement, Kabins is to be sentenced to five years of probation, six months of home detention, 250 hours of community service, and pay $3.5 million in restitution to victim Melodie Simon.

Kabins could also be fined up to $250,000 under the plea agreement.

Kabins was facing up to 20 years in prison and a $250,000 fine on each count if he had been convicted of the original charges against him -- one count of conspiracy and seven counts of mail and honest service fraud. He had pleaded not guilty in March to all the charges and has remained out of custody on his own recognizance.

The plea agreement is binding, meaning that if the court doesn't accept the agreement and certain other conditions are met, Kabins can withdraw his guilty plea, the U.S. Attorney’s office said.

Gage and Awand were charged with conspiracy and fraud in 2007. The men are accused of being part of a network of Las Vegas physicians and lawyers who cheated clients out of honest services by, among other things, protecting doctors from malpractice lawsuits and sharing kickbacks from legal settlements.

In March, Kabins was charged with fraud and conspiracy for his alleged role in the scheme.

In pleading guilty, Kabins admitted that on Aug. 3, 2000, he assisted another orthopedic surgeon, Dr. John Thalgott, in a surgery on Simon, a former Olympian who became paralyzed from complications that arose after the surgery. In the plea, Kabins admitted he knew he could be sued and asked Awand, a medical consultant who referred personal injury cases to him and other lawyers, to persuade Simon’s attorney, Noel Gage, not to sue him or Thalgott, the U.S. Attorney’s office said.

Kabins, the attorney’s office said, believed that Awand would corruptly attempt to persuade Gage by referring lucrative personal injury cases to Gage; after receiving referrals from Awand, Gage sued neither Kabins nor Thalgott and instead sued an anesthesiologist, Dr. Daniel Burkhead.

Kabins said Gage didn’t sue him because Awand had referred cases to him, the U.S. Attorney’s office said.

To help Gage sue the anesthesiologist, Dr. Kabins drafted a “letter of complaint” from which he intentionally omitted information about his secret dealings with Gage and information about Simon’s medical condition following her surgery.

Kabins was licensed by the Nevada State Board of Medical Examiners on June 6, 1992. He is scheduled to be sentenced in federal court at 1 p.m. on Jan. 15. The jury trial of Gage and Awand is set for Feb. 8.

The case is being investigated by the FBI, IRS Criminal Investigation and the Nevada Attorney General’s Office, and prosecuted by Assistant U.S. Attorneys Steven W. Myhre and Daniel R. Schiess.

Gage's first trial ended with a hung jury on March 18, 2008. The U.S. Attorney for Nevada at the time, Greg Brower, said then that he intended to retry the case, but a judge dismissed it after federal prosecutors declined to grant Kabins immunity to testify against Gage.