U.S. v. Lovern

• Citation: 590 F.3d 1095
• Decision Date: 09 September 2009
• Docket Number: No. 08-3141.,No. 08-3149.,08-3141.,08-3149.
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Jerry L. LOVERN, Defendant-Appellant. United States of America, Plaintiff-Appellee, v. Robert J. Barron, Defendant-Appellant.
• Court: United States Courts of Appeals. United States Court of Appeals (10th Circuit)

590 F.3d 1095

UNITED STATES of America, Plaintiff-Appellee, v. Jerry L. LOVERN, Defendant-Appellant.

United States of America, Plaintiff-Appellee, v. Robert J. Barron, Defendant-Appellant.

No. 08-3141.

No. 08-3149.

United States Court of Appeals, Tenth Circuit.

September 9, 2009.

Lee Thompson, Thompson Law Firm, LLC, Wichita, KS, for Defendant-Appellant Jerry L. Lovern.

Timothy J. Henry, Assistant Federal Public Defender, Wichita, KS, for Defendant-Appellant Robert J. Barron.

Mona Lee M. Furst, Assistant United States Attorney (Marietta Parker, Acting United States Attorney, with her on the briefs), for Plaintiff-Appellee United States in Case Nos. 08-3141, 08-3149.

Before TACHA, O'BRIEN, and GORSUCH, Circuit Judges.

GORSUCH, Circuit Judge.

The principal owner-operator of Red Mesa Pharmacy pled guilty to conspiracy to dispense drugs in violation of the Controlled Substances Act. Meanwhile, two of his employees went to trial on similar charges and now appeal their resulting convictions. The trial record tells very different stories about the two men and their roles in the pharmacy's operations. The first, Jerry Lovern, is a pharmacist with almost forty-five years' experience. The record strongly suggests that he well knew details of the pharmacy's illicit operation and we affirm his convictions. By contrast, Robert Barron, a high school drop-out with no experience in the medical or pharmaceutical fields, served as the pharmacy's computer technician. There is no evidence that he knew Red Mesa's managers and pharmacists filled prescriptions issued without a legitimate medical purpose or in defiance of professional standards. Accordingly, we are obliged to reverse his convictions.

I

A

Nothing about Wilbur and Margaret Hilst's foray into the pharmacy business was conventional. They opened their pharmacy, Red Mesa, in Wichita, Kansas, in the Fall of 2005 by submitting false information in their license applications to the Kansas Board of Pharmacy and the federal Drug Enforcement Administration (DEA). They then pursued a business plan that involved securing customers exclusively through websites run by two companies, SafeTrust Processing and IntegraRx, based respectively in Costa Rica and Seattle, Washington.

Through these web-based businesses, customers across the nation received prescription drugs simply by filling out an online questionnaire. Physicians in the United States and Puerto Rico contracted with SafeTrust and IntegraRx to log into their websites, review customer questionnaires, and either approve or disapprove the customers' requested prescriptions. Physicians did not examine their putative patients; they did not verify any of the personal information provided in the questionnaires; in fact, they did not have any dealings at all with the subjects of their prescriptions. Yet, the doctors approved the vast majority of the requested prescriptions. SafeTrust and IntegraRx took these approved prescriptions and placed them online for access by participating pharmacies, including Red Mesa, to fill and ship. Customers paid for all this by credit card through the two websites; in turn, SafeTrust and IntegraRx shared with Red Mesa $7.00 for each order filled, in addition to paying for the wholesale cost of the drugs. In all, Red Mesa received $703,611.00 during its eight months of operation.

For a few months, Red Mesa carried a certificate from the DEA permitting it to distribute substances subject to the Controlled Substances Act (CSA). See 21 U.S.C. §§ 801 et seq. During this period, Red Mesa filled more prescriptions for controlled substance (a total of 9,256) than noncontrolled ones — this in contrast to standard pharmacies, where the breakdown favors noncontrolled substances by a factor of nine to one. The controlled substances Red Mesa distributed consisted largely of diet and sleep aid pills, while the noncontrolled drugs it specialized in included so-called "lifestyle drugs" (Viagra and the like), as well as some pain medications.

Mr. Hilst ran Red Mesa's operations. He opened the pharmacy in November 2005 and was responsible for managing the inventory and choosing which prescriptions the pharmacy filled. His wife served as the pharmacy's day-to-day operations manager while Mr. Barron worked as a computer technician, printing out labels for prescriptions that Mr. Lovern, the principal pharmacist, then filled.

Red Mesa was not open for long before authorities grew curious. Their first clue came from Maxine Ihrig, Red Mesa's original pharmacist, who became apprehensive when she saw that the pharmacy filled prescriptions issued by doctors who didn't reside in the same states as their patients. She expressed her discomfort to LaTonyua Rice, a pharmacist and inspector with the State Board of Pharmacy, in November 2005. In turn, Ms. Rice reported all this to the Board and to Patricia O'Malley, a DEA investigator. The State did not immediately revoke Red Mesa's license, but in February 2006 Ms. Rice visited the pharmacy and issued a number of citations. Among these, she cited the pharmacy for violating a Kansas law limiting customers to a 30-day supply of diet pills at any one time. The DEA conducted its own investigation and executed a search warrant in March 2006. After the search, Mr. Hilst surrendered the pharmacy's DEA federal controlled substance registration. While that left Red Mesa no longer able lawfully to fill prescriptions for controlled substances — and it didn't — the pharmacy did continue to distribute noncontrolled prescription substances until June 2006, when its state license was also revoked, forcing the pharmacy to shutter.

B

Eventually, the federal government brought charges against the Hilsts, as well as Mr. Lovern and Mr. Barron, alleging violations of the CSA. "Enacted in 1970 with the main objectives of combating drug abuse and controlling the legitimate and illegitimate traffic in controlled substances, the CSA creates a comprehensive, closed regulatory regime criminalizing the unauthorized manufacture, distribution, dispensing, and possession of substances classified in any of the Act's five schedules." Gonzales v. Oregon, 546 U.S. 243, 250, 126 S.Ct. 904, 163 L.Ed.2d 748 (2006). Section 841(a)(1) makes it unlawful, except under circumstances authorized by the statute, "for any person knowingly or intentionally ... to manufacture, distribute, or dispense, or possess with intent to manufacture, distribute, or dispense, a controlled substance."

In one prominent and, for our purposes, pertinent exception, the CSA allows registered practitioners to issue prescriptions for controlled substances classified in four of the five schedules. See 21 U.S.C. § 829. At the same time, however, implementing regulations require that these prescriptions must "be issued for a legitimate medical purpose by an individual practitioner acting in the usual course of his professional practice." 21 C.F.R. § 1306.04(a). While the responsibility for meeting this test rests in the first instance with the prescribing doctor, "a corresponding responsibility rests with the pharmacist who fills the prescription." Id. Accordingly, "[a]n order purporting to be a prescription issued not in the usual course of professional treatment ... is not a prescription within the meaning and intent of section 309 of the Act (21 U.S.C. § 829) and the person knowingly filling such a purported prescription, as well as the person issuing it, shall be subject to the penalties provided for violations of the provisions of law relating to controlled substances." Id.

Mr. Hilst pled guilty to conspiracy under the CSA, and the charges against Mrs. Hilst were dismissed. This appeal, meanwhile, arises from the joint trial of Mr. Lovern and Mr. Barron, each of whom was charged with and convicted of one count of conspiracy to distribute controlled substances in contravention of § 841(a)(1), and three substantive counts of distribution of controlled substances in violation of § 841(a)(1) and 18 U.S.C. § 2 (aiding and abetting). We begin with Mr. Lovern's appeal before addressing Mr. Barron's.

II

Mr. Lovern seeks reversal of his convictions for five primary reasons. He argues that they run afoul of the CSA's terms and Supreme Court's teachings in Gonzales v. Oregon; that insufficient evidence exists, as a matter of law, to support the jury's verdict; that the district court erred in refusing to accept his expert witness; that § 841(a) is unconstitutionally vague as applied to him; and that the court erred by declining to give an instruction to the jury on an entrapment by estoppel defense. None of these arguments, however, warrants reversal.

A

Mr. Lovern begins by asserting that "[t]here was no evidence [at trial] and there is no law that a prescription received via the [I]nternet is illegal." Aplt. Br. at 14. But this is a red herring: the government has disclaimed any interest in trying to prove that using the Internet to transmit a lawful prescription is unlawful under the CSA. Rather, to show that Mr. Lovern violated the CSA, the government has argued before us that the issuance of a prescription based solely on an online questionnaire, without anything more — without any existing doctor-patient relationship, without a physical exam, without any confirmation of the questionnaire's contents, without any further contact of any sort — falls outside the usual course of contemporary medical practice. And, the government contends, Mr. Lovern knew this is exactly how IntegraRx and SafeTrust physicians operated, yet he still filled their prescriptions for controlled substances. It is this theory of CSA liability that the government has pursued against Mr. Lovern, and that Mr. Lovern must address to avoid his conviction.

Seeking to do so, Mr. Lovern replies that, under Gonzales v. Oregon, the federal government has no business trying to define what practices are and are not within the usual course of professional medical...