United States v. Dairy

• Decision Date: 14 July 2011
• Docket Number: Case No. C11–0065–RSM.
• Citation: 812 F.Supp.2d 1239
• Parties: UNITED STATES of America, Plaintiff, v. RHODY DAIRY, L.L.C., a limited liability company, and Jay L. De Jong, an individual, Defendants.
• Court: U.S. District Court — Western District of Washington

812 F.Supp.2d 1239

UNITED STATES of America, Plaintiff,

v.RHODY DAIRY, L.L.C., a limited liability company, and Jay L. De Jong, an individual, Defendants.

Case No. C11–0065–RSM.

United States District Court, W.D. Washington,at Seattle.

July 14, 2011.

David Roy East, U.S. Attorney's Office, Seattle, WA, Shannon L. Pedersen, U.S. Dept. of Justice Office of Consumer Litigation, Washington, DC, for Plaintiff.

Bryan L. Page, T. Gregory Greenan, Zender Thurston PS, Bellingham, WA, for Defendants.

ORDER ON SUMMARY JUDGMENT AND REQUEST FOR INJUNCTION

RICARDO S. MARTINEZ, District Judge.

I. INTRODUCTION

This matter comes before the Court on Motions for Summary Judgment brought by Plaintiff United States of America (“Government”) and Defendants Rhody Dairy L.L.C. and Jay L. De Jong (“Defendants”) (Dkt. 11, 18), and on the Government's request for injunctive relief pursuant to 21 U.S.C. § 332(a) of the Federal Food, Drug, and Cosmetic Act (“FDCA”). Dkt. 11. The Government alleges that Defendants have violated several provisions of the FDCA. Defendants have denied that their conduct violates the FDCA.

II. BACKGROUND

This action arises out of several inspections the Food and Drug Administration (“FDA”) conducted of Defendants' dairy farm. Defendants are in the business of selling cow's milk and selling cows for beef. The FDA conducted an inspection of Defendants' farm in 2004, and twice in 2010. During these inspections, the FDA alleges that it observed a number of violations. Specifically, the Government now contends that Defendants have violated §§ 331(a), 331(k), and 331(u). Accordingly, the Government seeks a statutory injunction under § 332(a) permanently enjoining Defendants from violating the above provisions of the FDCA and to bring themselves into compliance to the satisfaction of the FDA. Defendants counter that they have not violated any provisions of the FDCA because the Government has misconstrued the statutory language, the alleged misconduct did not result in an actual violation, and there is no record keeping requirement imposed by the statute. Defendants also contend that the injunction is improper.

III. SUMMARY JUDGMENT STANDARD

Summary judgment is appropriate where the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law. FRCP 56; Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). The Court must draw all reasonable inferences in favor of the non-moving party. See F.D.I.C. v. O'Melveny & Myers, 969 F.2d 744, 747 (9th Cir.1992), rev'd on other grounds, 512 U.S. 79, 114 S.Ct. 2048, 129 L.Ed.2d 67 (1994). In ruling on summary judgment, a court does not weigh evidence to determine the truth of the matter, but “only determine[s] whether there is a genuine issue for trial.” Crane v. Conoco, Inc., 41 F.3d 547, 549 (9th Cir.1994) (citing O'Melveny & Myers, 969 F.2d at 747). Material facts are those which might affect the outcome of the suit under governing law. Anderson, 477 U.S. at 248, 106 S.Ct. 2505.

IV. ARGUMENT

A. 21 U.S.C. § 331(a)

The Government alleges that Defendants have violated 21 U.S.C. § 331(a). Section 331(a) of the FDCA prohibits “[t]he introduction or delivery for introduction into interstate commerce of any food ... that is adulterated” within the meaning of § 342(a)(4). The elements for establishing a violation of this provision are: (1) the product at issue is food; (2) there is an interstate commerce nexus; and (3) the food is adulterated. United States v. Blue Ribbon Smoked Fish, Inc., 179 F.Supp.2d 30, 42 (E.D.N.Y.2001), aff'd in relevant part, 56 Fed.Appx. 542 (2d Cir.2003).

Defendants contend that the Government has not proven that a specific individual animal was improperly administered drugs and then sold for slaughter, and thus cannot prove that adulterated food was sold. Defendants' contention is without merit. The law is clear that § 342(a)(4) requires that the Government need only show a “reasonable possibility” that conditions under which the food is “prepared, packed, or held” may render the food injurious to health. See id. at 44.

Defendants further assert that their administration of animal drugs does not constitute “insanitary conditions” under § 342(a)(4) and that § 342(a)(4) does not impose a recordkeeping requirement on dairy farms. Under § 342(a)(4), “insanitary conditions” is construed to “include a lack of adequate controls concerning treatment of food-producing animals with drugs.” See FDA, Proper Drug Use and Residue Avoidance by Non–Veterinarians, Compliance Policy Guide (“CPG”) § 615.200, available at http:// www. fda. gov/ ICECI/ Compliance Manuals/ Compliance Policy Guidance Manual/ ucm 074660. htm. The Government contends that by not keeping adequate records of their administration of drugs to cows, Rhody Dairy operates under “insanitary” conditions within the meaning of § 342(a)(4). Yet, according to Defendants, the FDA cannot impose such an obligation in the absence of more specific regulatory requirements.

Regardless of whether the language specifically requires the dairy farm to maintain records of the its drug administration, § 342(a)(4) is clear in that its purpose is to prevent conditions that may render food harmful to the health of consumers. Furthermore, the administration of drugs to animals without adequate control measures can doubtlessly lead to conditions which could produce adulterated food. See 58 Fed. Reg. 39,218 (July 22, 1992). Therefore, Defendants' administration of animal drugs constitutes “insanitary conditions” under § 342(a)(4).

Finally, Defendants contend that genuine issues of fact exist regarding the adequacy of their recordkeeping. However, the adequacy of Defendants recordkeeping is not an issue of fact, but rather a legal conclusion. The FDA has documented facts regarding Defendants operations. These facts reveal a number of inadequacies that were apparent over the course of three visits. The observations included failure to maintain documentation of the treatment history, the disease conditions treated, the dosages used, the route of administration, the person administering the drug, the pre-slaughter withdrawal times, and an inventory system for accounting for the drugs administered to animals, among other inadequacies. Dkt. 11 at 4–7.

Against this record, Defendants assert that they are aware of the necessary data concerning the administration of drugs because they employ “a standard procedure for how each drug is administered.” Dkt. 26 at 11. This standard procedure includes use of a chalkboard where dates are recorded, a sheet from the veterinarian that lists withdrawal times for drugs administered, and placement of an ear tag on the animal with the cow number, drug administered, and date of administration. Id. However, Defendants' conclusion that it engages in adequate record keeping will not suffice for this Court to disregard Defendants' failure to produce satisfactory records during three past inspections. Rather, this Court must conclude that Defendants lack adequate controls for the administration of animal drugs, and that they are not in conformance with § 331(a).

B. 21 U.S.C. § 331(k)

Section 331(k) of the FDCA prohibits the performance of any act with respect to a drug that may result in the drug being adulterated while held for sale after shipment in interstate commerce. The elements of a violation of § 331(k) are that (1) the relevant product is a drug or drug component, (2) defendants received the drug or drug component after shipment in interstate commerce, and (3) defendants have adulterated or caused the adulteration of the drug component. United States v. Blue Ribbon Smoked Fish, Inc., 179 F.Supp.2d at 42 (discussing § 331(k) in the context of food adulteration).

1. “Held for sale” language

Defendants set forth several grounds on which they rest their theory that they have not violated § 331(k). First, Defendants contend that § 331(k) is inapplicable because they have not “held for sale” any drugs within the meaning of the statute. Accordingly, Defendants believe that the Government's interpretation of the phrase, “held for sale” is overly expansive.

The Government argues that the “held for sale” requirement is satisfied if the product can be shown to have been used for any purpose other than for the defendant's personal consumption. This argument is grounded on the notion that the FDCA is to be interpreted in such a way so as to protect the public health and is to be liberally construed. See United States v. An Article of Drug ... Bacto–Unidisk, 394 U.S. 784, 798, 89 S.Ct. 1410, 22 L.Ed.2d 726 (1969); United States v. Articles of Drug Containing Diethylstilbestrol, 528 F.Supp. 202, 205 (D.Neb.1981). Furthermore, cases addressing the substantive issue of what constitutes being “held for sale” are consistent with a broader interpretation of the statute. For example, several cases have held that drugs and devices used in the treatment of patients are “held for sale” by doctors as part of the distribution process. See United States v. Evers, 643 F.2d 1043, 1050 (5th Cir.1981); United States v. Diapulse Corp. of Am., 514 F.2d 1097, 1098 (2nd Cir.1975); United States v. Article of Device ... Cameron Spitler, 261 F.Supp. 243, 246 (D.Neb.1966).

Defendants, by contrast, rely on United States v. Geborde for the proposition that “held for sale” has a narrower definition than simply meaning “other than for personal consumption.” 278 F.3d 926 (9th Cir.2002). In Geborde, the court held that a criminal defendant who gave away illegal drugs did not hold those drugs for sale within the meaning of § 331(k). However, in distinguishing Geborde, the court noted that the defendant distributed homemade items to friends free of charge, and therefore concluded that the setting was noncommercial. Id. at 931. Yet unlike Geborde, the...