United States v. Butterbaugh, C14-515 TSZ

CourtUnited States District Courts. 9th Circuit. United States District Court (Western District of Washington)
Writing for the CourtThomas S. Zilly United States District Judge
Docket NumberC14-515 TSZ
Decision Date05 August 2015


C14-515 TSZ


August 5, 2015


THIS MATTER comes before the Court on a motion for summary judgment, docket no. 20, brought by plaintiff United States of America (the "Government"). In this action, the Government seeks a substantial civil penalty from defendant Barton Butterbaugh, M.D. for prescribing controlled substances to individuals in Washington without first obtaining from the Drug Enforcement Administration ("DEA") a registration for Washington. Having reviewed all papers filed in support of, and in opposition to, the Government's motion,1 including the supplemental briefs submitted upon the Court's

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request, and having considered the oral arguments of counsel during the hearing held on July 23, 2015, the Court enters the following order.


Butterbaugh resides in Arizona. Butterbaugh Aff. at ¶ 1 (docket no. 25-2). He is licensed to practice medicine in Arizona and Washington, and he has a DEA registration for Arizona. Compl. at ¶¶ 3-4 (docket no. 1). He does not have a DEA registration for Washington. Id. at ¶ 4; Butterbaugh Aff. at ¶ 18. During the period from October 2010 to November 2012, Butterbaugh treated individuals in Washington who were patients of eClinicMD, a Florida-based company. Butterbaugh Aff. at ¶¶ 8, 17, & 23. According to Butterbaugh, in August 2010, the physician employed by eClinicMD to service patients in Washington "suddenly moved" to California, leaving approximately 80 individuals

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without a treatment provider. Id. at ¶ 17. Butterbaugh agreed to "fill in" until eClinicMD hired a permanent local physician. Id.

Over the course of the 25 months at issue, Butterbaugh made several trips to Seattle to see patients, and he consulted with patients in Washington via telephone from his office in Arizona. Id. at ¶¶ 20-21. He estimates that approximately 85-90% of the refills for his Washington patients were authorized from his Arizona office. Id. at ¶ 21. Butterbaugh also states that over 60% of the medications he prescribed during the period at issue for individuals in Washington were not controlled substances. See id. & Ex. I to Resp. (docket no. 25-1 at 26). According to data compiled by Washington's Prescription Monitoring Program, Butterbaugh has written over 1,300 prescriptions for controlled substances, spread among over 200 people. See Garrety Decl. at ¶ 7(a) & Ex. A (docket no. 23).

Although Butterbaugh applied for and obtained a medical license in Washington before he began to treat patients in Washington, he did not apply for a Washington DEA registration. Butterbaugh Aff. at ¶ 18. Butterbaugh contends that he relied on advice provided by an employee of the Washington Department of Health, who allegedly indicated that, because he was temporarily substituting for a recently-departed physician (i.e., operating locum tenens2), Butterbaugh was not required to obtain a separate DEA registration for Washington. Id.; see Ex. F to Resp. (docket no. 25-1 at 18-19).

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The prescriptions Butterbaugh issued to Washington patients contained an address in Seattle, an "866" telephone number, a Washington medical license number, and a DEA registration number for Arizona. See Zennan Decl. at ¶ 4 & Ex. A (docket no. 22). The "866" telephone number on a prescription issued by Butterbaugh made a pharmacist suspicious, and after the pharmacist contacted the DEA, an investigation commenced in February 2011. Id. at ¶ 3. Other pharmacists reported concerns in December 2011 and May 2012, and Alan Zend, DO (an osteopath who treats opiate addiction) called the DEA in July 2012 after a patient who had received prescriptions from Butterbaugh admitted to Zend that he was an addict. See Ex. D to Zennan Decl. (docket no. 22-5).

In late November 2012, Assistant United States Attorney ("AUSA") Christina Fogg (nee Dimock) wrote to Butterbaugh and informed him that the DEA had been monitoring him and found him to be "routinely out of compliance" with the requirement that he have a DEA registration for Washington. Ex. N to Fogg Decl. (docket no. 21-2). Butterbaugh was told that the Government was "considering initiating civil litigation" against him, and that he should contact AUSA Fogg to discuss the possibility of pre-litigation settlement. Id. After receiving AUSA Fogg's letter, Butterbaugh immediately ceased treating patients in Washington and issued no further prescriptions to individuals in Washington. Butterbaugh Aff. at ¶ 23. In April 2014, the Government commenced this action, pleading one claim for relief under 21 U.S.C. § 842(c), see Compl. (docket no. 1), and it has now moved for summary judgment on both liability and the amount of any civil penalty.

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To obtain summary judgment, the Government must demonstrate the absence of any genuine issue of material fact and an entitlement to judgment as a matter of law. See Fed. R. Civ. P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). A fact is material if it might affect the outcome of the suit under the governing law. E.g., Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). To survive a motion for summary judgment, the adverse party must present "affirmative evidence," which "is to be believed" and from which all "justifiable inferences" are to be favorably drawn. Id. at 255, 257. When the record, however, taken as a whole, could not lead a rational trier of fact to find for the non-moving party, summary judgment is warranted. See Danner v. Himmelfarb, 858 F.2d 515, 517 (9th Cir. 1988) (citing Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986)). The Court is satisfied that the questions before it are not factual, but rather legal, in nature. The issues for decision are (i) whether the Government has stated and proven a cognizable claim for a civil penalty; and (ii) if so, what amount of civil penalty is appropriate.

A. Liability

The Government seeks to impose a civil penalty against Butterbaugh under a provision of the Comprehensive Drug Abuse Prevention and Control Act of 1970, also known as the Controlled Substances Act ("CSA"), indicating that "any person who violates this section shall, with respect to any such violation, be subject to a civil penalty of not more than $25,000." 21 U.S.C. § 842(c)(1)(A) (emphasis added). As is clear from the statute, a person is subject to a civil penalty under § 842(c) only if the person violated

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§ 842. Section 842(a) contains 16 subsections defining different unlawful acts. In its Complaint, the Government did not indicate which of these 16 subsections, if any, it alleged Butterbaugh violated. In its motion for summary judgment and its supplemental brief, however, the Government relies solely on § 842(a)(1), which prohibits any person subject to registration requirements from distributing or dispensing3 a controlled substance in violation of 21 U.S.C. § 829. See 21 U.S.C. § 842(a)(1).

To establish a violation of § 842(a)(1), the Government must prove that Butterbaugh (i) was subject to registration requirements, and (ii) either distributed or dispensed controlled substances in violation of § 829. With respect to the latter element, the Government contends that dispensing controlled substances without a "valid" prescription constitutes a violation of § 829. The relevant subsections of § 829, however, do not contain the word "valid," but rather make a distinction between schedule II controlled substances (which may be dispensed by a practitioner directly to an ultimate user or upon a "written" prescription that may not be refilled) and schedule III and IV substances (which may be dispensed directly or upon either a "written" or an "oral" prescription that may be refilled up to five times within six months of the prescription). 21 U.S.C. §§ 829(a) & (b); see also United States v. Moore, 423 U.S. 122, 137 n.13 (1975) ("On its face § 829 addresses only the form that a prescription must take.").

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When viewed, however, in the context of the applicable statutes and regulations, the question presented is not whether the prescriptions that Butterbaugh issued were valid,4 but rather whether they were, in fact, "prescriptions." If the slips of papers that Butterbaugh gave to his patients in Washington were not "prescriptions," then regardless of whether controlled substances were thereby obtained by these individuals, Butterbaugh distributed (as opposed to dispensed) controlled substances without a prescription, which constitutes a violation of § 829, and in turn, a violation of § 842(a)(1). See 21 U.S.C. §§ 802(8) & (11) (together defining "distribute" to mean "the actual, constructive, or attempted transfer of a controlled substance" other than by administering or dispensing it).

The parties have not cited any cases directly on point.5 Although "prescription" is not statutorily defined, a regulation provides that a prescription may be issued only by

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"an individual practitioner" who is "[a]uthorized to prescribe controlled substances by the jurisdiction in which he [or she] is licensed to practice" and is either registered with the DEA or exempt from registration. See 21 C.F.R. § 1306.03(a); see also 21 U.S.C. § 821 (authorizing the...

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