How Far Does FDA’s Say-So Travel?

November 16, 2014

By Douglas B. Farquhar

For years, one of the frustrations for attorneys challenging FDA in court (including us, many times) has been the degree of deference that federal courts have accorded to FDA interpretations of the Federal Food, Drug, and Cosmetic Act.  This happens when FDA says that FDCA provisions are ambiguous, and a court agrees.  But a recent and unusual statement by U.S. Supreme Court Justice Antonin Scalia (joined by Justice Clarence Thomas) invites the right party, in the right civil case, to challenge a federal agency’s interpretation of ambiguous provisions of a statute, like the FDCA, that address both criminal and administrative violations.  The statement may not only open the door – but illuminate the path – for a successful challenge, in a civil or administrative enforcement case, to FDA interpretations of FDCA provisions that have both administrative enforcement and criminal implications.  And there are plenty of provisions like that.

Historically, the so-called “rule of lenity” prohibits agency interpretations from turning ambiguous criminal statutory provisions into an acceptable basis for sending people to prison.  The principle is that it is unfair to impose harsh sanctions on an individual when an individual, examining the governing law, could reasonably believe that he or she was allowed to do what he or she did.

Douglas F. Whitman, the defendant in the case that was the subject of the recent statement by Justice Scalia, had been convicted of a violation of federal law, as interpreted by the Securities and Exchange Commission.  He appealed his conviction.  The Second Circuit Court of Appeals affirmed his conviction, deferring to the SEC on an interpretation of the relevant provision of the Securities Exchange Act.  Justice Scalia, agreeing with the decision that the Supreme Court should not further review the case (Whitman had filed a petition for a writ of certiorari), noted that the decision of the Second Circuit was consistent with numerous prior decisions in which courts “have deferred to executive interpretations of a variety of laws that have both criminal and administrative applications.”  But Justice Scalia questions whether those cases were correctly decided.  Is it appropriate, he asks, to apply a rule of lenity with regard to application of ambiguous laws in criminal cases (thus allowing courts to decide on their own whether statutory provisions are ambiguous, and to interpret statutes as they deem fit, even when in conflict with the agency interpretation), but to make courts follow the agency say-so when the same provisions are applied in administrative decisions?  Those decisions, in Justice Scalia’s view, are contrary to “many cases” holding that a law with “both criminal and civil applications” should apply a rule of lenity “in both settings.”  If the “rule of lenity” were applied to the FDCA in the civil setting, that could mean, for example, that the court and the relevant parties would not be compelled to accept FDA’s interpretation in an FDA enforcement action brought in federal court – such as a seizure of drugs or medical devices that FDA contends are adulterated, or an injunction against a company or an individual under like circumstances.

Justice Scalia did not think that the Whitman case was the appropriate platform to address these issues, because of the “procedural history of the case.”  But he is explicitly sending a signal that he wants the Supreme Court to address the issue of whether agencies are entitled to deference “when a petition properly presenting the question comes before us” – even in a civil setting (when, for example, an affected party challenges an agency enforcement decision).  In a blogpost discussing a prior Supreme Court decision, we asked the same question about interpretations of ambiguous statutory provisions that have both criminal and administrative implications.

None of the cases cited by Justice Scalia dealt with provisions of the FDCA, but it is hard to think of a reason that the same principles he discusses would not apply to the FDCA.  Courts frequently defer to FDA on interpretations of the FDCA, especially in cases dealing with the Hatch-Waxman Amendments (see, e.g., Apotex, Inc. v. FDA, 414 F. Supp. 2d 61 (D.D.C. 2006)Purepac Pharm. Co. v. Thompson, 354 F.3d 877 (D.C. Cir. 2004)), but also in at least one case about whether dietary supplements are adulterated.  This violation could result in criminal liability for distribution of adulterated dietary supplements (under Section 301(a) of the FDCA, 21 U.S.C. § 331(a)).

Justice Scalia’s invitation should not be ignored by an FDA-regulated company or individual who wants to challenge, for example, an enforcement action taken on the basis of an ambiguous provision of the FDCA, where that provision has criminal, as well as administrative, implications.  Judge Scalia is wondering whether it makes sense for a court not to defer to an agency interpretation of an ambiguous statutory provision in the criminal context, but to defer to the same agency interpretation of the same provision in the civil or administrative context.  Maybe that does not make sense.

Categories: Enforcement