- Associated Press - Sunday, February 16, 2014

LAS VEGAS (AP) - A new judge will be named to preside over a federal trial that has been pushed back again for a former Las Vegas physician and clinic owner already convicted in state court in a 2007 hepatitis outbreak at an endoscopy clinic.

U.S. District Judge Gloria Navarro withdrew herself Thursday from the federal conspiracy and health-care fraud case involving Dipak Desai and Desai’s former Endoscopy Center of Nevada business manager, Tonya Rushing.

A new judge wasn’t immediately named.

Navarro’s recusal came days after the long-delayed trial had been scheduled to begin - more than six years after the hepatitis outbreak became public and almost three years since Desai and Rushing were indicted in federal court.

Both have pleaded not guilty to conspiracy and health-care fraud charges alleging they schemed to inflate anesthesia times and overbill health insurance companies.

Desai’s attorney, Richard Wright, has sought to delay the federal trial indefinitely. He maintains that a series of strokes have left Desai, 64, physically and mentally unfit for trial.

Wright said Friday he didn’t know why Navarro withdrew from the case. Rushing’s attorneys, Robert Draskovich and Louis Schneider, didn’t respond to messages.

Desai, a former Nevada State Board of Medical Examiners member, surrendered his license to practice medicine in Nevada and is serving 18 years to life at a prison in northern Nevada.

He was found guilty in state court in Las Vegas of second-degree murder and 26 other criminal charges including insurance fraud, criminal neglect and reckless disregard stemming from the hepatitis outbreak.

The outbreak was made public in February 2008, when health officials notified 63,000 former Desai clinic patients to get tested for potentially fatal blood-borne diseases, including hepatitis and HIV. Health officials later said more than 100 people may have been infected in one of the largest viral outbreaks tied to a medical clinic ever in the U.S.

The state criminal charges, including insurance fraud, stemmed from cases involving seven people, including two who have since died.

Desai and Rushing were indicted in April 2011 on federal charges that they defrauded insurers from January 2005 through February 2008 by inflating the length of medical procedures and overbilling health insurance companies for anesthesia.

Rushing wasn’t charged in the state case in Clark County District Court, and she testified last June that patient anesthesia times were charted before patients were treated.

The federal indictment alleges that nurses were instructed to falsify anesthesia times for endoscopies and colonoscopies by listing 31 minutes for each procedure even though they rarely took that long. It said some nurse anesthetists saw as many as 80 patients a day, making it impossible to have taken 31 minutes with each.

The hepatitis outbreak also spawned dozens of civil lawsuits, including several that yielded jury findings holding drug manufacturers and the state’s largest health management organization liable for hundreds of millions of dollars in damages to plaintiffs.


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