Federal Food and Drug Act violations.

• Author: Schnell, Sherry
• Position: Tenth Survey of White Collar Crime

In 1938, pursuant to its constitutional authority to regulate interstate commerce,(1) Congress enacted the Federal Food, Drug and Cosmetic Act ("FDCA" or "Act").(2) The primary goal of this legislation is to protect the health and safety of the public(3) by preventing deleterious, adulterated or misbranded articles from entering interstate commerce.(4) Those who violate its provisions are subject to criminal penalties, injunctions, and seizure of the adulterated or misbranded goods.(5)

1. ELEMENTS OF THE OFFENSE

   1. Statutory Elements

      1. Food, Drug, or Cosmetic

         According to FDCA definitions, "food" includes "(1) articles used for food or drink for man or other animals, (2) chewing gum, and (3) articles used for components of any such article."(6) "Drugs" are defined as "articles intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease in man or other animals."(7) According to the Act, "cosmetics" are "articles intended to be rubbed, poured, sprinkled, or sprayed on, introduced into, or otherwise applied to the human body or any part thereof for cleansing, beautifying, promoting attractiveness, or altering the appearance."(8)

      2. Adulterated or Misbranded

         An article is said to be adulterated if its ingredients are poisonous, filthy, putrid, or otherwise unsanitary, or if it has come into contact with unsanitary substances.(9) Misbranding includes false or misleading labels, packaging, and containers.(10)

      3. Delivery or Transportation into Interstate Commerce

         The requirement that the article be introduced into interstate commerce is the final prong of the statute that must be met.(11) Interstate commerce is defined as "commerce between any State or Territory and any place outside thereof." It is not confined "to the actual transportation of articles across state lines, but includes the whole transaction of which such transportation is a part."(12)

   2. Common Law Responsible Relation " Element

      The Food and Drug Administration ("FDA") and the courts impose broad standards of criminal liability for violations of the FDCA. In United States v. Dotterweich,(13) the Supreme Court established a standard of strict liability for violations of the Act's provisions by holding that proof of the defendant's intent to commit a violation was not required to obtain a conviction.(14)

      In the Dotterweich majority opinion, Justice Frankfurter reasoned that the goal towards which the FDCA was aimed, protection of the public health and safety, demanded a standard that "dispenses with the conventional requirement for criminal conduct - awareness of some wrongdoing."(15) In an attempt to define the limits of this assertion, the Court held that a finding of corporate guilt would extend only to those individuals who had a "responsible share in the furtherance of the transaction which the statute outlaws."(16) However, a number of courts encountered difficulties in defining what has become known as the Dotterweich "responsible relation" test as it applied to the scope of criminal liability under the FDCA.(17) The Supreme Court attempted to resolve this confusion in United States v. Park.(18) In Park, the Court limited the Dotterweich "responsible relation" standard by requiring that the government establish a prima facie case showing that the defendant failed to act on authority which could have prevented or corrected the violation.(19) Thus, where an individual is in a position of power or authority which would allow him to prevent, detect, or correct violations of the Act, the individual will be held strictly liable for failing to act on that authority.(20)

      Despite the Park clarification, lower courts and commentators continue to struggle to determine the appropriate scope of strict liability with respect to corporate officers. The confusion results from the impossibility defense as established by the Park court's statement that although strict liability requires the highest standard of foresight and vigilance, the criminal aspect of the Act does not require that which is objectively impossible.(21)

2. DEFENSES

   1. Constitutional Defenses

      1. First Amendment

         Challenges to the Act based on the First Amendment(22) grounds of free speech(23) and infringement on the free exercise of religion(24) have been mounted, but such challenges have consistently met with defeat.

      2. Fifth Amendment

         Fifth Amendment(25) challenges based on the vagueness of various provisions(26) or on lack of notice(27) have also been unsuccessful. However, claims that the prosecution under the FDCA violated the Fifth Amendment right against self-incrimination have succeeded under certain circumstances.(28) Moreover, the traditional warnings outlined in Miranda v. Arizona(29) need not be given to corporate officials prior to interviews with FDA inspectors. The courts have consistently found that company representatives are not in custodial situations; they are not prohibited from moving about the premises; and they are not prohibited from consulting with their attorneys during the FDA inspections.(30)

      3. Fourth Amendment

         Fourth Amendment(31) challenges have been controversial. The general rule is that warrantless searches of commercial property are unreasonable and therefore unconstitutional.(32) However, warrantless searches have been upheld when a substantial government interest exists, a search is necessary, and the method of inspection substitutes for a warrant.(33) Warrantless searches have also been upheld when the target is a "closely-regulated" industry.3"

         It is a criminal offense for corporate officials or employees to deny entry or inspection when FDA officials arrive with written notice and present appropriate credentials.(35) However, authorities are split as to whether valid consent is necessary to legitimize a warrantless search. Some courts have found that a warrantless search is not legitimate without valid consent.(36) Other courts have held that the lawfulness of a warrantless search is solely dependent upon the search being conducted pursuant to a valid, statutory authority, irrespective of consent.(37) If consent is withheld, the FDA is required to obtain an administrative search warrant before they can re-enter the premises.(38) Such a warrant requires a more relaxed demonstration of evidence than that required by traditional Fourth Amendment standards.(39) Thus, while it is permissible for a corporate agent to refuse consent, refusal may not be in the agent's best interests since the FDA will likely obtain a search warrant, and furthermore, denying entry to FDA officials may ultimately result in punishment under the criminal provisions of the FDCA.(40)

   2. Impossibility Defense

      One potential affirmative defense to FDCA liability is the "impossibility defense."(41) In United States v. New England Grocers Supply Co.,(42) the District Court of Massachusetts discussed the alternative interpretations of the impossibility defense and decided on an interpretation which requires a corporate officer to prove that although extraordinary care was used, he was nevertheless powerless to correct or prevent the violation.(43) Upon such a showing, the burden of proof shifts to the government to prove that the officer was not, in fact, powerless to prevent or correct the violation.(44)

3. Enforcement

   Violations of the FDCA may be punished by criminal penalties,(45) injunctive relief,(46) or seizure of the articles found to be adulterated or misbranded. (47) The decision to use these penalty provisions is strictly within the discretion of the FDA.(48) Once a decision is made to prosecute, the federal government alone has the authority to conduct the proceedings.(49) The Justice Department, in conjunction with the FDA, determines which matters will become criminal cases.(50) Recently, the director of the FDA's Office of Enforcement said that it will rely more on criminal actions and will be less inclined to enter into protracted discussions with firms.(51) In addition, the FDA often names individuals as well as corporations in enforcement actions.(52)

   Despite the preemption of private claims under the FDCA, private state tort claims have been permitted.(53) In Hurley v. Lederle Laboratories Division of American Cyanamid Co.,(54) the defendant argued that the FDCA preempted state law tort claims.(55) The Fifth Circuit found no evidence to support the defendant's contention that the FDA sought to comprehensively preempt state products liability law as it pertains to vaccine manufacturers. (56) The court found, however, that if a conflict between federal and state labeling requirements prevented compliance with both federal and state obligations, preemption should be implied where the FDA has determined the proper wording for a specific label after considering "all the relevant and available information."(57)

   1. Inspections

      To facilitate the discovery and subsequent elimination of FDCA violations, the Act authorizes FDA inspectors to enter and inspect certain premises, provided that the statutory prerequisites are met.(58) Inspectors must present their credentials,(59) provide written notice to the owner or agent of the company,(60) and perform the inspection at a reasonable time,(61) within reasonable limits(62) and in a reasonable manner.(63) However, notice to the owner need not express any reason for the inspection or any expected findings.(64)

      The permissible scope of FDA inspections is fairly broad. Although some types of information are protected by the Freedom of Information Act,(65) the FDA is free to inspect all pertinent parts of a facility in which food, drugs, devices, or cosmetics are manufactured, including vehicles, equipment, containers, and labels.(66) The FDA inspectors may take samples(67) and photographs(68) when the materials being inspected relate to items that move in interstate commerce.(69) In a facility where prescription drugs or restricted devices are manufactured, the FDA may inspect records, files...