National Nutritional Foods Ass'n v. Mathews

• Decision Date: 07 June 1977
• Docket Number: D,No. 561,561
• Citation: 557 F.2d 325
• Parties: The NATIONAL NUTRITIONAL FOODS ASSOCIATION and Solgar, Co., Inc., Plaintiffs-Appellants, v. F. David MATHEWS, Secretary of Health, Education and Welfare and Alexander M. Schmidt, Commissioner of Food and Drugs, Defendants-Appellees. ocket 76-6135.
• Court: U.S. Court of Appeals — Second Circuit

Page 325

557 F.2d 325

The NATIONAL NUTRITIONAL FOODS ASSOCIATION and Solgar, Co., Inc., Plaintiffs-Appellants, v. F. David MATHEWS, Secretary of Health, Education and Welfare and Alexander M. Schmidt, Commissioner of Food and Drugs, Defendants-Appellees.

No. 561, Docket 76-6135.

United States Court of Appeals,

Second Circuit.

Argued March 25, 1977.

Decided June 7, 1977.

Milton A. Bass, New York City (Bass, Ullman & Lustigman and Jacob Laufer, New York City, on the brief), for plaintiffs-appellants.

Naomi Reice Buchwald, Asst. U. S. Atty., S. D. N. Y., New York City (Robert B. Fiske, Jr., U. S. Atty., Samuel J. Wilson, Asst. U. S. Atty., S. D. N. Y., New York City, and Stephen H. McNamara, Office of Gen. Counsel, Dept. of Health, Education and Welfare, Washington, D. C., on the brief), for defendants-appellees.

Before ANDERSON and MESKILL, Circuit Judges, and MARKEY, Chief Judge, U. S. Court of Customs and Patent Appeals. ^*

Robert P. ANDERSON, Circuit Judge:

Plaintiffs-appellants, producers and vendors of vitamin preparations, appeal the dismissal of their action seeking declaratory and injunctive relief against regulations promulgated by the Food and Drug Administration (FDA) which classified preparations of Vitamins A and D in excess of 10,000 IU (international units) per dosage unit and 400 IU per dosage unit, respectively, as "drugs" under § 201(g)(1) of the Federal Food, Drug and Cosmetic Act, 21 U.S.C. § 321(g)(1), and which restricted them to prescription sale under § 503(b)(1) of the Act, 21 U.S.C. § 353(b)(1). 21 C.F.R. §§ 250.109 and 250.110 (1976) (originally promulgated as parts 3.94 and 3.95). The district court upheld the regulations as not "arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law" under the standard of review prescribed by 5 U.S.C. § 706(2)(A). National Nutritional Foods Ass'n v. Mathews, 418 F.Supp. 394 (S.D.N.Y.1976).

This is the third time that this case has been on appeal in this court. We affirmed the district court's denial of preliminary injunctive relief in National Nutritional Foods Association v. Weinberger, 491 F.2d 845 (2d Cir. 1973), aff'g 366 F.Supp. 1341 (S.D.N.Y.1973). The regulations sought to be declared invalid, therefore, have been in effect since October 1, 1973. On the second appeal, the district court had dismissed the complaint finding that the regulations satisfied the "arbitrary or capricious" standard of review. National Nutritional Foods Association v. Weinberger, 376 F.Supp. 142 (S.D.N.Y.1974), remanded, 512 F.2d 688 (2d Cir.), cert. denied sub nom., National Nutritional Foods Association v. Mathews, 423 U.S. 827, 96 S.Ct. 44, 46 L.Ed.2d 44 (1975). On remand the district court was instructed to:

". . . conduct an Overton-type hearing (including such affidavits or testimony as to the Commissioner's reasoning as the court deems necessary) for the purpose of determining whether, upon the entire administrative record before the Commissioner, which the court should scrutinize, Silva v. Lynn, 482 F.2d 1282 (1st Cir. 1973), the Commissioner acted rationally in classifying the higher dosage levels as a 'drug' within the meaning of § 201(g) of the Act, 21 U.S.C. § 321(g)." 512 F.2d at 703.

On this appeal from the district court's dismissal following remand, plaintiffs contend that the district court did not comply with this court's mandate on remand, and that it erred in upholding the classification of the regulated levels of Vitamins A and D, as drugs.

Acting under the rule-making power vested in the Secretary of Health, Education and Welfare, § 701(a) of the Act, 21 U.S.C. § 371(a), and delegated to the Commissioner of Food and Drugs (Commissioner), 21 C.F.R. § 2.120(a)(1), the latter, on December 14, 1972, announced his proposal to adopt regulations restricting the sale of Vitamins A and D in dosages exceeding 10,000 IU and 400 IU, respectively, to prescription sales. 37 Fed.Reg. 26618. Employing the notice-and-comment procedure of the Administrative Procedure Act, 5 U.S.C. § 553(c), the Commissioner solicited comments from interested persons concerning the proposed regulations. Over 2,500 written comments were received. On August 2, 1973, the Commissioner summarized the comments, answered the criticisms of the proposed regulations, and, upon determining that the regulations were in the public interest and should be adopted, ordered that they become effective on October 1, 1973. ¹ 38 Fed.Reg. 20723.

During the period when the proposed Vitamins A and D regulations were under consideration by the FDA, formal administrative hearings were held on proposed labeling statements and standards of identity for "Food for Special Dietary Uses." These regulations, covering the vast array of vitamin and mineral preparations, were adopted as parts 80 and 125 of 21 C.F.R. on August 2, 1973, 38 Fed.Reg. 20708-18, 20730-40, to become effective January 1, 1975. As part of the FDA's regulatory scheme for the sale of vitamin and mineral dietary supplements, the Commissioner promulgated new U.S. Recommended Daily Allowances for the vitamins and minerals considered essential to human nutrition and for which there was available scientific evidence to show the level of ingestion nutritionally necessary. 21 C.F.R. § 80.1(f)(1). The U. S. RDA upper limits for Vitamin A is 2,500 IU for children under four years of age, 5,000 IU for adults, and 8,000 IU for pregnant and lactating women. The upper limit for Vitamin D is 400 IU for all age groups. As part of the general Dietary Supplement regulations, the FDA determined that all preparations containing more than the upper limit of the U. S. RDA per serving for any vitamin or mineral on the list is a "drug," 21 C.F.R. § 125.1(h), ² thus subjecting such products to the rigorous provisions of subchapter V of the Act. When the Commissioner promulgated the specific Vitamins A and D regulations, therefore, the levels restricted to prescription sale under these regulations were already denominated "drugs" under the general Dietary Supplement regulations.

In National Nutritional Foods Association v. Food & Drug Administration, 504 F.2d 761 (2d Cir. 1974), cert. denied, 420 U.S. 946, 95 S.Ct. 1326, 43 L.Ed.2d 424 (1975), this court, on a petition to review the general dietary supplement regulations under § 701(f) of the Act, 21 U.S.C. § 371(f), determined that the evidence supporting 21 C.F.R. § 125.1(h), classifying as "drugs" all vitamin and mineral preparations containing dosages in excess of the U. S. RDA's upper limits, was insufficient to bring such preparations within the statutory definition of "drug" in § 201(g) of the Act, 21 U.S.C. § 321(g). Id. at 788-89. Prior to this ruling, the district court in this separate review proceeding of the Vitamins A and D regulations had concluded that the regulations were valid. National Nutritional Foods Association v. Weinberger, supra, 376 F.Supp. at 149. In so doing, the district court reaffirmed its finding on denial of preliminary injunctive relief that high-potency Vitamins A and D products were "squarely within" the statutory definition of "drugs." National Nutritional Foods Association v. Weinberger, supra, 366 F.Supp. at 1346.

This court's decision to remand this case for an Overton-type hearing was brought about by intervening invalidation of the 21 C.F.R. § 125.1(h) "drug" classification of preparations in excess of the U. S. RDA in National Nutritional Foods Ass'n v. FDA, supra (504 F.2d 761), the failure of the Commissioner fully to state the rationale supporting the classification of Vitamins A and D at the regulated levels as "drugs," and the incomplete nature of the administrative record provided in support of the regulations. National Nutritional Foods Ass'n v. Weinberger, supra, 512 F.2d at 701-03. The only substantive issue for the district court to resolve on remand of the present case was whether the Commissioner's classification of high-potency Vitamins A and D preparations was in accordance with the statutory definition of a "drug" and whether the record established that the classification was not arbitrary or capricious and was in accordance with law.

This court directed the district court to "scrutinize" the entire administrative record, and to give the Commissioner, either through affidavit or testimony, "as the court deems necessary," an opportunity to present his complete reasoning underlying the drug classification. On remand, plaintiffs argued that the Commissioner should be subject to deposition and called as a witness to testify on the matter. Plaintiffs also pressed for full disclosure of all documents, including the early drafts and intra-agency memoranda, relating to the proposal and adoption of the regulations. The district court denied plaintiff's requests. The Government submitted the Commissioner's affidavit explaining his best recollection of his reasons for classifying high-potency quantities of Vitamins A and D, as drugs. After deletion of certain references to material, not part of the record, a revised affidavit was submitted which the district court accepted as the complete statement of reasons, the lack of which had necessitated the remand. The only other addition to the record was a collection of miscellaneous letters and documents relating to the regulations that were either inadvertently omitted or were considered by the FDA not to be part of the record, because they either postdated the final promulgation or antedated the original proposal of the regulations. The Government represented to the district court that this was the entire administrative record. A group of intra-agency communications and drafts of the regulations was not made part of the record after the district court examined the documents in camera and ruled that they were exempt from disclosure under the Freedom of Information Act exception for intra-agency memoranda, 5 U.S.C. § 552(b)(5), and that, in any event, plaintiffs had not shown...