Amid increasing investor interest in the telehealth sector, a recent Department of Justice (“DOJ”) prosecution involving Done Global underscores evolving enforcement risks for telehealth platforms, management services organizations (“MSOs”), and the investors that support them. In late 2025, a federal jury in the Northern District of California convicted the founder and chief executive officer and the clinical president of Done Global, a virtual behavioral health company, in what DOJ has described as its first criminal drug distribution prosecution arising out of telemedicine prescribing practices.1 DOJ subsequently reinforced the verdict by obtaining a superseding indictment of the company on substantively similar allegations.2
Background
Done Global operated a subscription-based telehealth platform focused on diagnosing and treating attention-deficit/hyperactivity disorder. The company launched around the beginning of the COVID-19 pandemic and expanded rapidly as temporary federal emergency rules permitted clinicians to prescribe certain controlled medications via telehealth without first conducting an in-person examination. As the platform scaled, pharmacies, regulators, and others raised concerns regarding Done Global’s prescribing practices, including whether stimulant medications were being prescribed with appropriate clinical oversight.
Following a federal investigation led by the DOJ and the Drug Enforcement Administration, DOJ filed criminal charges in mid-2024. The government alleged, among other things, that Done Global’s business model improperly influenced clinical decision-making and resulted in prescriptions that were not issued for legitimate medical purposes. The case proceeded to trial in federal court in the Northern District of California, where a jury convicted Ruthia He, Done Global’s founder and chief executive officer, and Dr. David Brody, Done Global’s clinical president and the sole owner of Done Health, P.C., the affiliated physician-owned professional corporation, of conspiracy and unlawful distribution of controlled substances in November 2025.3 The jury also convicted He of conspiracy to obstruct justice. Sentencing is pending.
In December 2025, DOJ filed a superseding indictment adding Done Global and a newly formed physician-owned professional corporation as defendants, alleging continued violations of the federal controlled substances laws through February 2025
DOJ’s Enforcement Theory: CPOM As an Evidentiary Predicate
Although corporate practice of medicine (“CPOM”) violations were not charged as standalone offenses, DOJ relied on California’s CPOM doctrine as part of its evidentiary framework to support its contention that certain prescriptions were issued outside the usual course of professional practice and without a legitimate medical purpose.4 In particular, prosecutors pointed to CPOM principles to argue that prescribing decisions reflected management influence rather than the independent medical judgment of licensed clinicians.
As described in the indictment and DOJ press releases, DOJ alleged that Done’s MSO and technology platform exercised significant influence over aspects of clinical operations. According to the government, this influence included allegations that Done:
- established standardized prescribing-related protocols and performance expectations;
- structured patient encounters in ways that limited their scope and duration;
- encouraged the prescribing of stimulant medications in circumstances the government contended were not clinically supported;
- limited follow-up care and implemented automated refill processes;
- compensated clinicians based primarily on the number of patients receiving prescriptions, rather than time spent or services provided; and
- designed platform workflows that, in DOJ’s view, constrained individualized clinical decision-making.
The government further alleged that the affiliated physician-owned professional corporation functioned primarily as a nominal vehicle through which prescriptions were issued, while management retained operational control over key aspects of the practice. DOJ argued that, under these circumstances, formal compliance with MSO agreements or physician-ownership requirements did not preclude a finding that management exercised impermissible influence over medical decision-making.
Notably, DOJ did not contend that telemedicine prescribing or the pandemic-era telehealth flexibilities were unlawful in themselves. Rather, the government argued that those flexibilities were used in ways that, in its view, facilitated prescribing without sufficient individualized clinical assessment or independent professional judgment.
Why This Case Matters/Key Takeaways
The Done Global prosecution provides insight into how DOJ is approaching enforcement in the telehealth space, particularly in cases involving controlled substance prescribing and MSO-supported practice models. Although the case turns on its specific facts, it reflects several themes that may be relevant for telehealth platforms, MSOs, and their investors as enforcement activity in this area continues.
- Use of CPOM Principles as Part of Federal Criminal Analysis: Although corporate practice of medicine (“CPOM”) violations were not charged as standalone offenses, DOJ relied on California CPOM concepts as part of its evidentiary framework under the Controlled Substances Act. In Done Global, the government argued that alleged management influence over clinical decision-making supported its contention that certain prescriptions were issued outside the usual course of professional practice and without a legitimate medical purpose. While this approach does not transform CPOM violations into federal crimes, it illustrates how CPOM-related considerations may factor into federal enforcement theories.
- Focus on MSO Governance, Compensation, and Platform Design: The prosecution underscores DOJ’s attention to how telehealth platforms operate in practice, in addition to the conduct of individual prescribers. DOJ examined compensation arrangements, operational workflows, and technology features as part of its case, reflecting an emphasis on management structures and platform design where those elements are closely integrated with clinical services. The case suggests that DOJ may look beyond formal ownership and contractual arrangements to assess how care is delivered on a day-to-day basis.
- Implications for Scaled and Investor-Backed Telehealth Models: Although the defendants in Done Global were operators rather than investors, the prosecution reflects DOJ’s interest in telehealth platforms characterized by centralized management, standardized processes, and significant growth. For telehealth companies, MSOs, and their investors, the case highlights the importance of understanding how MSO arrangements, compensation models, and technology tools may be viewed in the context of controlled substance prescribing and broader enforcement priorities.
Against this backdrop, telehealth companies, MSOs, and their investors may wish to consider whether existing structures and practices appropriately delineate clinical and nonclinical functions in operation, not just in documentation. Areas commonly reviewed in diligence and compliance assessments include the scope of MSO services, clinician compensation methodologies, platform workflows and automation features, and ongoing monitoring of CPOM-related considerations as regulatory and enforcement expectations continue to evolve.
Conclusion
As the DEA and HHS continue to develop a permanent regulatory framework for telemedicine prescribing, and as Congress considers the future of Medicare telehealth flexibilities, cases such as Done Global may inform both regulatory oversight and enforcement priorities. The verdict and subsequent superseding indictment highlight that telehealth compliance considerations may extend beyond billing and licensure to include questions about management structures, financial incentives, and technology design, particularly where the government alleges an impact on independent clinical judgment.
Ropes & Gray is continuing to monitor developments in this case and broader telehealth enforcement trends.
