Federal Food and Drug Act violations.

• Author: Imamshah, Nicole
• Position: Twelfth Survey of White Collar Crime

1. INTRODUCTION II. Elements of the Offense

   1. Statutory Elements

      1. Food, Drug, Cosmetic, or Device

      2. Adulterated or Misbranded

      3. Delivery or Transportation into Interstate Commerce

   2. "Responsible Relation" Element III. DEFENSES

   1. Constitutional Defenses

      1. Fourth Amendment

      2. Fifth Amendment

   2. Impossibility Defense IV. ENFORCEMENT

   1. Inspections

   2. Sanctions

   3. Sentencing V. CURRENT DEVELOPMENTS: PROSECUTION AND PREVENTION

   1. Prosecution

   2. Prevention

1. INTRODUCTION

   In 1938, Congress enacted the Federal Food, Drug and Cosmetic Act ("FDCA" or "Act"),(1) pursuant to its constitutional authority to regulate interstate commerce.(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 adulterated or misbranded goods.(5)

2. ELEMENTS OF THE OFFENSE

   There are three statutory elements to a FDCA violation. First, the object of the violation must be a "food," "drug," "cosmetic," or "device." Second, the item must be "adulterated" or "misbranded." Third, the item must be introduced into interstate commerce.(6) Furthermore, courts have read a fourth element into the Act which is essential for a conviction: in order for individuals to be liable under the Act, they must bear a "responsible relation" to the offense.(7)

   1. Statutory Elements

      1. Food, Drug, Cosmetic, or Device

         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."(8) "Drugs" are defined as "articles intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease in man or other animals."(9) 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."(10) "Devices" are defined as any "instrument, apparatus, implement, machine, contrivance, implant, in vitro reagent, or other similar or related article, including any component, part, or accessory, which is (1) recognized in the official National Formulary . . . , (2) intended for use in the diagnosis of disease or other conditions, or in the cure, mitigation, treatment, or prevention of disease . . . , or (3) intended to affect the structure or any function of the body . . . ."(11) In determining the intended use for any drug, cosmetic, or device, the FDA "is not bound by the manufacturer's subjective claims of intent but can find actual therapeutic intent on the basis of objective evidence."(12)

      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.(13) Misbranding includes using false or misleading labels, packaging, and containers.(14)

      3. Delivery or Transportation into Interstate Commerce

         The requirement that the article be introduced into interstate commerce is the final element of the statute that must be satisfied for successful prosecution.(15) Interstate commerce is defined as "commerce between any State or Territory and any place outside thereof."(16) 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."(17) In prosecutions concerning violations with respect to a device, the connection with interstate commerce is presumed.(18)

   2. "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,(19) 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.(20) In Dotterweich, the Supreme Court upheld the conviction of the president and general manager of a pharmaceutical supply company for violation of the FDCA through interstate shipment of misbranded and adulterated drugs because of his position within the company, although he took no actual part in the shipment.(21) In an attempt to define the limits of this type of liability, 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."(22)

      Lower courts have encountered difficulties in defining what has become known as the Dotterweich "responsible relation" test, as it applies to the scope of criminal liability under the FDCA.(23) The Supreme Court attempted to resolve this confusion in United States v. Park.(24) In Park, the Court refined 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.(25) 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.(26)

      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 Park Court's statement that although strict liability requires the higher standard of foresight and vigilance, the criminal aspect of the Act does not require that which is objectively impossible.(27) Based upon this statement, several corporate agents tried for violations of the FDCA have used the "objective impossibility" defense, which requires proof that the defendant was powerless to prevent or remedy the violations.(28) Where such a claim is made, the defendant has the burden of coming forward with evidence, but the Government still bears the ultimate burden of proving beyond a reasonable doubt the defendant's guilt, including his power to prevent or correct the violation.(29)

3. DEFENSES

   The provisions of the Food, Drug and Cosmetic Act have been challenged on a number of constitutional grounds. In addition, defendants faced with prosecution have raised affirmative defenses to the FDCA. Much of the litigation in these areas occurred in the 1970's and 80's, and courts still refer to these seminal cases today.

   1. Constitutional Defenses

      1. Fourth Amendment

         Fourth Amendment(30) challenges to the FDCA have been numerous and controversial. The general rule holds that the Fourth Amendment's prohibition against unreasonable searches applies to administrative inspections of commercial property.(31) However, legislative schemes which authorize warrantless administrative searches of commercial property are not necessarily violative of the Fourth Amendment,(32) particularly where the warrantless inspection involves a "closely regulated" industry.(33) Such warrantless inspections are deemed reasonable if (1) a "`substantial' government interest . . . informs the regulatory scheme pursuant to which the inspection is made," (2) the inspection is "necessary to further [the] regulatory scheme," and (3) "the statute's inspection program both in terms of certainty and regularity of its application provides a constitutionally adequate substitute for a warrant."(34)

         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 divided as to whether valid consent is necessary to legitimize a warrantless search. The United States Supreme Court and a few United States district 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.(36) The Ninth and Fifth Circuits added a consent requirement, finding that a warrantless search is not legitimate without valid consent.(37) In these jurisdictions, if consent is withheld, the FDA is required to obtain an administrative search warrant before it may 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 most likely obtain a search warrant. Furthermore, denying entry to FDA officials may ultimately result in punishment under the criminal provisions of the FDCA.(40)

         Some courts also have addressed the issue of whether FDA agents may seize items without a search warrant under the FDCA. While a few court decisions have authorized the in rem arrest procedure of [sections] 304 in situations involving closely regulated businesses,(41) the Ninth Circuit concluded that agents seeking to enter homes and offices in order to seize items alleged to violate the FDCA must comply with the Fourth Amendment by obtaining a warrant based upon probable cause and authorized by a detached judicial officer.(42)

      2. Fifth Amendment

         Fifth Amendment(43) due process challenges based on the vagueness of various provisions(44) or on a lack of notice(45) have been unsuccessful. One may have the right to invoke the Fifth Amendment privilege against self-incrimination in order to avoid providing the government with information under certain circumstances in FDCA litigation,(46) though the traditional Miranda(47) warnings need not be given to corporate officials prior to interviews with FDA inspectors. The courts have consistently found that company...