U.S. v. Spectro Foods Corp.

• Decision Date: 13 October 1976
• Docket Number: No. 76-1217,76-1217
• Citation: 544 F.2d 1175
• Parties: UNITED STATES of America, Appellee, v. SPECTRO FOODS CORPORATION, a corporation, et al., Appellants.
• Court: U.S. Court of Appeals — Third Circuit

Page 1175

544 F.2d 1175

UNITED STATES of America, Appellee, v. SPECTRO FOODS CORPORATION, a corporation, et al., Appellants.

No. 76-1217.

United States Court of Appeals, Third Circuit.

Argued May 26, 1976.

Decided Oct. 13, 1976.

Jonathan L. Goldstein, U. S. Atty., James A. Plaisted, Asst. U. S. Atty., Newark, N. J., for appellee.

James Malcolm Williams, Minneapolis, Minn., for appellants.

Before ADAMS and HUNTER, Circuit Judges, and SCHWARTZ, District Judge. ^*

OPINION OF THE COURT

MURRAY M. SCHWARTZ, District Judge.

Presently before the Court is an appeal from a Preliminary Injunction secured by the government pursuant to the Federal Food, Drug and Cosmetic Act ("the Act"), 21 U.S.C. § 332(a), and from an Order for Civil Contempt arising out of alleged violations of a Temporary Restraining Order and the Preliminary Injunction. The appellants are Spectro Foods Corporation ("Spectro") and Metamail Food Corporation ("Metamail"), both New Jersey corporations, Ernst O. Moenckmeier, president, and Jeanene Moenckmeier, secretary-treasurer of the two corporations. They manufacture and distribute a product known as "Bitter Food Tablets" which they allegedly market for use in the treatment of cancer. The Complaint alleged that Bitter Food Tablets contain amygdalin ¹ which is an "unsafe" "food additive", that the tablets themselves are a "food", a "drug" and a "new drug", and consequently that the defendants were in violation of section 331(a), (d) and (k) by virtue of their manufacture, distribution and holding for sale of an "adulterated food", a "misbranded drug" and an unapproved "new drug".

At the time the complaint was filed on January 19, 1975, the district judge entered a Temporary Restraining Order ("TRO") which restrained the manufacture and distribution of Bitter Food Tablets. At the government's urging that the public safety was jeopardized by the current availability of these tablets, the court further ordered Spectro to recall all previously distributed tablets by January 23. The next procedural development was an ex parte hearing held on Saturday, January 24. ² The result of the January 24 hearing was the issuance of an order to show cause why defendants should not be held in contempt for failure to comply with the recall order.

A hearing was held on January 28 to determine whether a preliminary injunction should issue and whether defendants should be held in contempt for violation of the TRO. At that time, a compliance schedule was set up and the contempt matter held in abeyance. The district judge also made findings of fact and conclusions of law and on January 29, he issued a preliminary injunction, the scope of which is contested in this appeal. The Preliminary Injunction not only incorporated the restraints on manufacture and distribution and the recall order of the TRO, but also restrained the distribution of any food additive or drug in violation of the Federal Food, Drug and Cosmetic Act. The court added further provisions which, in effect, ordered the FDA to supervise and control the conduct of defendants' business.

On February 9, the government, having concluded that the defendants had defaulted on the agreed upon compliance schedule, moved for a second order to show cause why a contempt order should not issue. At a hearing on February 17, the corporate defendants, Spectro and Metamail, were found in contempt for non-compliance with the recall order contained in the TRO and the Preliminary Injunction, and on the following day the district judge issued an "Order for Civil Contempt."

The defendants responded on February 20 by filing notice of this appeal from the TRO, the Preliminary Injunction and the Order for Civil Contempt. On February 27, a judge of this court denied a stay of these three orders.

I. JURISDICTION OF THE REVIEWING COURT

The Preliminary Injunction is a reviewable interlocutory order under the jurisdiction conferred by 28 U.S.C. § 1292(a)(1). Although an order of civil contempt is not ordinarily appealable, ³ one who is a party may appeal from a civil contempt order in connection with some other appealable order, including a preliminary injunction. ⁴ Consequently, the Court has jurisdiction over the appeal from the Order for Civil Contempt. ⁵

A TRO is not an injunction and consequently is not an appealable order. ⁶ Further, any purported notice of appeal from the TRO was not timely filed ⁷ and the TRO had, by its terms, expired prior to the appeal. The Court therefore need not consider whether the provisions of the TRO which did more than merely temporarily restrain defendants converted it into a form of an interlocutory injunction independently reviewable under 28 U.S.C. § 1292(a) (1). The contempt order, however, does purport to be based in part on defendants' non-compliance with the TRO. ⁸ Although this Court has no jurisdiction to entertain an appeal from the TRO, the validity of the TRO must nonetheless be examined for the limited purpose of our review of the Order for Civil Contempt ⁹ which the district court issued because of the defendants' failure to comply with the recall provisions of the TRO and Preliminary Injunction. ¹⁰

II. VALIDITY AND SCOPE OF THE PRELIMINARY INJUNCTION

Defendants have alleged a plethora of procedural defects in the district court proceedings. Most of these are wholly without merit, and the remainder, though in some respects disturbing, do not warrant reversal of the entire order granting the Preliminary Injunction. However, because several provisions of the Preliminary Injunction are far broader than the record justifies and others exceed the permissible scope of interlocutory relief, some portions of the Preliminary Injunction are invalid.

The prohibition of the manufacture and distribution of the Bitter Food Tablets or other amygdalin-containing articles in parts I and II of the Preliminary Injunction (and parts I and II of the TRO) are unobjectionable. The FDA affidavits indicated that amygdalin is a food additive not on the list of additives generally recognized as safe ("GRAS") and is a new drug for which no new drug application is on file. Other affidavits concerning defendants' manufacture and distribution of the Bitter Food Tablets provided a sufficient basis for the district court's preliminary conclusions that defendants violated 21 U.S.C. § 331(a), (d) and (k) by virtue of their manufacture, distribution and holding for sale of Bitter Food Tablets. ¹¹ Parts I and II of the TRO and the Preliminary Injunction are properly tailored to enjoin these particular violations of the Act.

The restraints in parts III and IV of the Preliminary Injunction are far broader than those in parts I and II. While parts I and II are limited to restraints on the manufacture and distribution of Bitter Food Tablets and other amygdalin-containing articles, parts III and IV prohibit the distribution of any article of food containing a food additive not recognized as safe or any new drug for which no new drug approval application has been filed. This broad injunctive restraint was issued notwithstanding that the Court had no evidence concerning distribution by defendants of any unsafe food additive or unapproved new drug other than the Bitter Food Tablets.

The district courts are invested with discretion to model their orders to fit the exigencies of the particular case, ¹² and have the power to enjoin related unlawful acts which may fairly be anticipated from the defendants' conduct in the past, ¹³ but a decree cannot enjoin conduct about which there has been no complaint. ¹⁴ All the alleged violations here stemmed from the manufacture and distribution of a single item. There was no evidence of record from which the district court could fairly have anticipated that defendants would distribute other substances in violation of the Act, nor did the court make any such findings. The use of the broad injunctive language on so scant a record constitutes error. Parts III and IV of the Preliminary Injunction will be vacated.

The primary controversy and that which led to issuance of the contempt order centers upon part V of the Preliminary Injunction and part III of the TRO. Those provisions employ identical language and encompass the recall order directing defendants to:

(a) notify an FDA representative of the location and amount of all stocks of Bitter Food Tablets, amygdalin and associated labeling;

(b) notify all recipients of the Bitter Food Tablets to return them to defendants;

(c) provide an FDA representative with a copy of said notice and a list of all persons to whom the Bitter Food Tablets had been distributed;

(d) obtain statements from each recipient of the Bitter Food Tablets as to amount of the article received, the amount returned, and disposition of that which was not returned; and (e) make copies of the customer statements available to an FDA representative.

Those aspects of the recall order which culminated in the Order for Civil Contempt did not merely operate to restrain further violations of the Act by defendants, for, according to the record, they involved items no longer in defendants' possession. ¹⁵ Neither did the recall order operate pendente lite to preserve the status quo, i. e., "the last actual uncontested status which preceded the pending controversy." ¹⁶ Rather the recall provision functioned as though it were "actually a discovery provision," as the district court characterized it, ¹⁷ enabling the government to locate various quantities of the tablets for seizure pursuant to 21 U.S.C. § 334. ¹⁸

The power to issue a preliminary injunction, especially a mandatory one, should be sparingly exercised. ¹⁹ Parts I and II of the Preliminary Injunction are based on the alleged violation of 21 U.S.C. § 331(a)(d)(k), and therefore do not require a showing of immediate and irreparable injury. On the other hand, the recall order does not address a particular violation of the Act from which injury may be presumed and thus...