U.S. v. Undetermined Quantities of Bottles of an Article of Veterinary Drug, 91-4197

• Citation: 22 F.3d 235
• Decision Date: 31 March 1994
• Docket Number: No. 91-4197,91-4197
• Parties: UNITED STATES of America, Plaintiff-Appellant, v. UNDETERMINED QUANTITIES OF BOTTLES OF AN ARTICLE OF VETERINARY DRUG Labeled in Part: "Pets Smellfree" or "Fresh Pet," and Those Containing Chlortetracycline, Defendant-Appellee, Pets Smellfree, Inc., Claimant-Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (10th Circuit)

Page 235

22 F.3d 235

UNITED STATES of America, Plaintiff-Appellant, v. UNDETERMINED QUANTITIES OF BOTTLES OF AN ARTICLE OF VETERINARY DRUG Labeled in Part: "Pets Smellfree" or "Fresh Pet," and Those Containing Chlortetracycline, Defendant-Appellee Pets Smellfree, Inc., Claimant-Appellee.

No. 91-4197.

United States Court of Appeals Tenth Circuit.

March 31, 1994.

Deborah S. Smolover, U.S. Dept. of Justice, Civ. Div., Appellate Staff, Washington, DC (Stuart M. Gerson, Asst. Atty. Gen., David J. Jordan, U.S. Atty., Douglas N. Letter, Appellate Litigation Counsel, Leon F. Szeptycki, Atty., Civ. Div., U.S. Dept. of Justice, Washington, DC; and Margaret Jane Porter, Chief Counsel, Denise M. Zavagno, Associate Chief Counsel, Food and Drug Admin., Rockville, MD, were on the brief), for plaintiff-appellant.

George K. Fadel, Bountiful, Utah, for defendant-claimant-appellee.

Before EBEL and HOLLOWAY, Circuit Judges, and COOK, ^* District Judge.

HOLLOWAY, Circuit Judge.

This case requires us to decide whether a compound sold as an internal pet "deodorant," whose only active ingredient is the antibiotic chlortetracycline, is a "drug" as defined by the Federal Food, Drug, and Cosmetic Act ("FDCA" or the Act), 21 U.S.C. Secs. 301, et seq. The United States brought this appeal from a grant of summary judgment to the defendant-claimant-appellee, Pets Smellfree, Inc. ("PSF").

I

Pets Smellfree ("Smellfree") is a food additive for animals which purports to diminish pet odors. Its only active ingredient is chlortetracycline calcium complex ("CTC"), an antibiotic compound. Smellfree was advertised as being able to stop pet odors associated with feces, urine, gas, and bad breath. Such odors are typically caused by bacteria. In this in rem action, the government seeks the seizure, condemnation, and destruction of all existing Smellfree and an injunction against its further production pursuant to the FDCA on the ground that Smellfree is an adulterated and misbranded drug. ¹

A product is considered adulterated if it is an unapproved new animal drug and misbranded if the company has not registered its facility and the drugs it produces with the Food and Drug Administration ("FDA"). The controlling issue before us is whether Smellfree is a drug because it is "intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease in man or other animals," or is an article "intended to affect the structure or any function of the body of man or other animals." 21 U.S.C. Sec. 321(g)(1)(B), (C).

On cross-motions for summary judgment, the district judge granted summary judgment for PSF and denied the government's motion and dismissed its action. The judge found the labeling, advertising and promotional materials showed no objective intent to treat disease in animals; the product was not intended for such use. Even though PSF may assist the animal in prevention of disease in its mouth, that alone is insufficient to classify PSF as a drug under Sec. 321(g)(1)(B). Memorandum Opinion and Order at 7.

The judge also found error in the FDA determination that PSF is an article intended to alter the structure or function of the animal; the agency action was not a permissible construction of the statute. There is no demonstrated intent literally to change the physical structure or function of the animal's body, and bacteria are not part of its body or structure. Thus, PSF was not intended to change the structure or function of animals within the meaning of Sec. 321(g)(1)(C). Id. at 7-8. Finally, the judge held that the small amounts of chlortetracycline calcium complex (CTC) contained in PSF, a mere subtherapeutic dose, does not demonstrate an intent to treat disease under Sec. 321(g)(1)(B).

After the district judge entered judgment, the government filed a motion for reconsideration, which was denied. The government filed a timely notice of appeal which only purported to appeal the denial of its motion for reconsideration. Later the government filed an amended notice of appeal challenging both the denial of its motion for reconsideration and the grant of PSF's motion for summary judgment.

II

We review a grant of summary judgment de novo. See Applied Genetics, Inc. v. First Affiliated Securities, Inc., 912 F.2d 1238, 1241 (10th Cir.1990). In so doing, we examine the record to see whether there were any genuine issues of material fact and, if not, whether the district court correctly applied the substantive law. See id. When we review the summary judgment, we look at the record in the light most favorable to the party opposing the motion. See Adolph Coors Co. v. Brady, 944 F.2d 1543, 1546 (10th Cir.1991). Moreover, summary judgment must be granted when the evidence before the district court demonstrates that the standard of Fed.R.Civ.P. 56 has been met. See Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986).

A.

The central question presented by this appeal is whether Smellfree is a drug under 21 U.S.C. Sec. 321(g)(1). For reasons that follow, we hold that it is. Accordingly, we must reverse the district court's grant of summary judgment to PSF and we remand the case for the entry of summary judgment in favor of the government.

PSF produced Smellfree in batches of 70 pounds at a time. See Declaration of Lloyd W. Beaston p 8, R. at 73. To make one 70 pound batch, PSF mixed one 50 pound package of CtC-50 chlortetracycline premix with 20 pounds of "other" inactive ingredients. See id. pp 7-8, R. at 72-73. CtC-50 is an "antibacterial feed premix for use in the manufacture of feeds" which contains 50 grams of CTC per pound. See R. at 186-90 (manufacturer's description and directions for use). Therefore, each pound of Smellfree made in this way contained approximately 35.7 grams of CTC, so that Smellfree consists of approximately 7.6%-7.7% CTC, while the remainder of its ingredients are inactive. ² See Beaston Declaration Ex. 21, R. at 103, Beaston Declaration Ex. 17, R. at 96.

It was uncontested below that the pet odors which Smellfree is claimed to alleviate are usually caused by bacterial contamination. See Declaration of Mukund R. Parkhie, D.V.M., M.S., Ph.D. p 7, R. at 55. It is also uncontested that the sole function of CTC is to kill susceptible bacteria. See Physicians' Desk Reference 1222 (47th ed. 1993); Affidavit of Stanley Marcus, Ph.D. p 12, R. at 162 (Smellfree "reduce[s] the number of bacteria in the digestive systems and oral cavities of pets"); Affidavit of Thomas H. Jukes, Ph.D. p 8, R. at 195 ("Subtherapeutic doses of [CTC] can be effective in the modification of bacteria in the digestive tract of animals. This modification is accompanied by a lessening in the incidence of subacute intestinal infections.") 21 U.S.C. Sec. 321(g)(1) defines "drugs" as:

(A) articles recognized in the official United States Pharmacopoeia, official Homoeopathic Pharmacopoeia of the United States, or official National Formulary, or any supplement to any of them; and (B) articles intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease in man or other animals; and (C) articles (other than food) intended to affect the structure or any function of the body of man or other animals.

The government relies on Sec. 321(g)(1)(B) and (C) in arguing for reversal in the instant case. Its brief states that the issues presented here are whether the product Pets Smellfree is a drug under 21 U.S.C. Sec. 321(g)(1)(B) or (C). Brief of Appellant United States of America at 2, 10-11. The complaint below alleged that Pets Smellfree was an adulterated and misbranded animal drug under the Act. Any new animal drug must be the subject of a new animal drug application, and reviewed and approved by the FDA, or be exempt from the filing requirement before it may be shipped in interstate commerce. Any unapproved new animal drug is deemed unsafe and adulterated. See 21 U.S.C. Sec. 360b(a)(1) and Sec. 351(a)(5). Moreover, a drug is misbranded, inter alia, if it is manufactured, etc., in any establishment not registered under 21 U.S.C. Sec. 360. See 21 U.S.C. Sec. 352(o).

In reviewing the FDA's determination that Smellfree is a drug, we must be guided by the directives regarding judicial review of administrative agency interpretations of their organic statutes laid down by the Supreme Court in Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). Those directives require that we first determine whether Congress has directly spoken to the precise question at issue. If the congressional intent is clear, we must give effect to that intent. If the statute is silent or ambiguous on that specific issue, we must determine whether the agency's answer is based on a permissible construction of the statute. See 467 U.S. at 842-43, 104 S.Ct. at 2781; N.L.R.B. v. Viola Industries--Elevator Div., Inc., 979 F.2d 1384, 1393 (10th Cir.1992) (en banc). Remedial legislation such as the Food, Drug, and Cosmetic Act is to be given a liberal construction consistent with the Act's overriding purpose to protect the public health. United States v. An Article of Drug Bacto-Unidisk, 394 U.S. 784, 798, 89 S.Ct. 1410, 1418, 22 L.Ed.2d 726 (1969).

With this general framework about the facts, the issues and our review in mind, we turn to the specific contentions of the parties on the issues presented under Sec. 321(g)(1)(B) and (C). ³

B.

PSF argues that the district judge properly ruled that Smellfree was not intended to cure, mitigate or prevent disease. PSF cites the following statement from the judge's Memorandum Decision and Order at 9:

3. Presence of small amounts of the antibiotic CTC in PSF

Notwithstanding the above, the United States asserts that because CTC is a classified antibiotic, any compound containing CTC in any concentration must be classified as a drug under either Subsection (B) or Subsection (C).

Under Subsection (B), the...