When federal agents raided the South Florida clinic of a wealthy eye doctor in 2013, their warrant only allowed them to gather evidence about his prolific Medicare billing for a fraud investigation.
But according to Dr. Salomon Melgen's defense attorneys, FBI agents illegally collected their client's handwritten notebook of personal contacts for a parallel corruption probe targeting the physician's close friend, U.S. Sen. Bob Menendez, the influential New Jersey Democrat.
The attorneys claim that the day after the January raid in West Palm Beach, an FBI agent went to a federal magistrate judge to obtain a follow-up warrant to justify the seizure of Melgen's notebook, which they say was mischaracterized as a “ledger of prostitution activities” in an affidavit.
Now, Melgen and Menendez — both charged in an influence-peddling corruption case in New Jersey — are aggressively fighting to dismiss their indictment, saying FBI and Justice Department prosecutors conducted an illegal search and misled a federal grand jury involving other evidence.
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“Instead of complying with the [initial] warrant, the agents launched a broad and intrusive room-to-room search for materials related to Dr. Melgen’s friendship with Senator Menendez and the outlandish and untrue allegations of sexual misconduct made by the anonymous ‘Peter Williams,’’’ according to court papers filed this week by the physician’s lawyers, Matthew Menchel and Kirk Ogrosky.
Williams, a mysterious tipster whose true identity never has been disclosed, instigated the FBI’s investigation of Melgen and Menendez more than two years ago.
The Justice Department plans to respond to this and other defense motions next month.
In court papers — among numerous defense motions filed this week in New Jersey federal court — Melgen’s lawyers accused the FBI of not only illegally collecting the physician’s 168-page handwritten notebook of contact information for family, friends and business associates: They also accused the FBI agent who filed the follow-up warrant after the raid on Melgen’s clinic of falsely referring to a “prostitute” by the name of “Dixi” who charged “1,200 to 1,500 in an unspecified currency.”
His lawyers asserted the FBI could have easily verified the notebook’s “Dixi” reference by checking an online report of a dispute involving trash collection by Dixi Sanitary Co. in Santo Domingo, the capital of the Dominican Republic. It is Melgen’s native country.
Melgen first was linked to Menendez just before the November 2012 elections, when the conservative Daily Caller website interviewed two alleged prostitutes who said they had relations with the New Jersey Democrat at Melgen's Dominican Republic mansion in Casa de Campo. After he was re-elected, the news died down.
But then, days before Menendez was about to start leading the Senate Foreign Relations Committee as chairman, reporters started receiving a 58-page dossier of emails between a Miami FBI agent and Williams, the tipster who claimed that some of the prostitutes had been underage.
In 2013, a Miami federal grand jury was convened to consider allegations that Melgen had arranged encounters with prostitutes in the Dominican Republic while he and Menendez stayed at the doctor’s seaside estate in Casa de Campo. The purported prostitutes quickly recanted their original stories alleging the trysts. And the Miami grand jury found no basis to file any charges on that matter, according to law enforcement sources.
But the Justice Department pursued a parallel investigation of Menendez in his home state. In April, the 61-year-old son of Cuban immigrants was accused of illegally peddling his political influence to help his pal, Melgen, with both business and personal concerns — in exchange for nearly $1 million in gifts and donations.
Among the charges: The senator tried to resolve the West Palm Beach physician’s multimillion-dollar billing dispute with the federal Medicare program. He also helped Melgen with a port security contract in the Dominican Republic. And, he even supported visa applications for the doctor’s girlfriends from the Dominican Republic, Brazil and Ukraine.
In exchange, the one-time chair of the Senate Foreign Relations Committee was accused of accepting several private plane flights to the Dominican Republic and other gifts, such as a luxury Paris hotel stay and a bounty of campaign donations, according to an indictment. The physician even contributed $40,000 to the politician’s legal defense fund involving a recall issue.
Soon after that indictment, Melgen, 61, was charged by a federal grand jury in West Palm Beach with over-billing the taxpayer-funded Medicare program by millions of dollars. He was accused of falsely diagnosing patients and fraudulently submitting claims for treating mostly elderly people with a disease that causes blindness. In 2012, Medicare paid Melgen more than any other doctor in America.
After a contentious series of hearings, Melgen was finally released from jail this month on an $18 million bond.