United States v. Dairy
| Decision Date | 01 September 2011 |
| Docket Number | Case No. 1:10-CV-865 |
| Parties | UNITED STATES OF AMERICA, Plaintiff, v. SCENIC VIEW DAIRY, L.L.C., a limited liability company, and MICHAEL D. GEERLINGS, MARK A. LUCAS, and MICHAEL J. VAN DAM, individuals, Defendants. |
| Court | U.S. District Court — Western District of Michigan |
HON. GORDON J. QUIST
In this case, the United States of America seeks to enjoin Scenic View Dairy, L.L.C., Michael D. Geerlings, Mark A. Lucas, and Michael J. Van Dam (referred to collectively as "Defendants"), from violating the Federal Food, Drug, and Cosmetic Act (the "FDCA" or the "Act"), 21 U.S.C. § 301 et seq., which the United States alleges Defendants are violating in the following respects: (1) delivering adulterated food for introduction into interstate commerce, in violation of 21 U.S.C. § 331(a); (2) adulterating drugs while held for sale and after shipment in interstate commerce, in violation of 21 U.S.C. § 331(k); and (3) failing to comply with the requirements set forth in 21 U.S.C. § 360b(a)(4)(A) for the extra-label use of new animal drugs, in violation of 21 U.S.C. § 331(u). The United States has filed a motion for summary judgment and a motion to strike several of Defendants' affirmative defenses. The Court heard oral arguments on May 23, 2011. For the reasons set forth below, the Court concludes that the United States' motion to strike should be granted in part and denied in part and its motion for summary judgment should be granted. The proper scope of injunctive relief, however, remains to be decided.
Scenic View is a limited liability company, formed under the laws of the State of Michigan, with its principal place of business located in Hamilton, Michigan. Scenic View owns and operates three separate dairy farms in West Michigan: the "Fennville Farm," the "Freeport Farm," and the "Gowen Farm." Scenic View says that it has about 10,000 cows at any one time. The individual Defendants are Michael D. Geerlings, who is president and majority owner of Scenic View, and Mark A. Lucas and Michael J. Van Dam, who manage the Fennville Farm and Freeport Farm, respectively, and are responsible for the daily operations at those farms, including the diagnosis and treatment of animals.1 Defendant Lucas is also a member.
Although Scenic View's primary business is the sale of Grade A milk, it also sells cull cows for beef, shipping approximately 70 cows to slaughter for human consumption per week. The cows are sold, either directly or by auction, to slaughterhouses both in Michigan and in other states, including Pennsylvania and Wisconsin. Since 2002, the United States Department of Agriculture ("USDA") Food Safety and Inspection Service ("USDA-FSIS") has detected above-tolerance levels of new animal drug residues in the edible tissues of slaughtered animals alleged to have originated from Scenic View on eleven occasions. After nearly all residue violations, the FDA inspected the farm from which the cow was believed to have originated. The United States has submitted evidence supporting each violation, including collection and lab reports, as well as records from the follow-up inspections. For purposes of clarity, this evidence will be discussed as part of the Court's analysis, after the legal framework has been set forth.
Summary judgment is appropriate if there is no genuine dispute as to any material fact and the moving party is entitled to a judgment as a matter of law. Fed. R. Civ. P. 56(a). Material factsare facts which are defined by substantive law and are necessary to apply the law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S. Ct. 2505, 2510 (1986). A dispute is genuine if a reasonable jury could return judgment for the non-moving party. Id.
A court must draw all inferences in a light most favorable to the non-moving party, but may grant summary judgment when "the record taken as a whole could not lead a rational trier of fact to find for the non-moving party." Agristor Financial Corp. v. Van Sickle, 967 F.2d 233, 236 (6th Cir. 1992) (quoting Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S. Ct. 1348, 1356 (1986)).
The United States alleges that Defendants have violated three separate provisions of the FDCA - § 331(a), (k), and (u) - and contends that the Court should grant its motion for summary judgment as to all three. The Court will discuss each provision in turn.
Section 331(a) prohibits "[t]he introduction or delivery for introduction into interstate commerce of any food . . . that is adulterated." 21 U.S.C. § 331(a). This provision has three elements: "(1) the product in question must be a food; (2) the food must be adulterated; and (3) there must be an interstate commerce nexus." United States v. Blue Ribbon Smoked Fish, Inc., 179 F. Supp. 2d 30, 42 (E.D.N.Y. 2001); accord United States v. Universal Mgmt. Servs., Inc., 191 F.3d 750, 754 (6th Cir. 1999). Defendants do not contest that their cattle qualify as "food" within the meaning of the Act nor that they deliver their cattle for introduction into interstate commerce.2Instead, the dispute here lies in whether the food is "adulterated" under the Act. The United States asserts that Defendants' food is adulterated under two separate provisions: 21 U.S.C. § 342(a)(2)(C)(ii) and 21 U.S.C. § 342(a)(4). As to each provision, the Court will begin by addressing the parties' legal disputes followed by a discussion of the evidence presented.
Under 21 U.S.C. § 342(a)(2)(C)(ii), food is adulterated "if it is or if it bears or contains . . . a new animal drug (or conversion product thereof) that is unsafe within the meaning of section 360b of this title." As a threshold matter, § 360b provides that a new animal drug is automatically considered unsafe prior to receiving FDA approval for its intended use. See 21 U.S.C. § 360b(a)(1)(A) (). To obtain FDA approval, a new animal drug must undergo an extensive application and approval process that requires the applicant to demonstrate that the drug is safe and effective when used in accordance with the proposed labeling. See id. §360b(b) and (d) (); see also FDA, Proper Drug Use and Residue Avoidance by Non-Veterinarians, Compliance Policy Guide ("CPG") § 615.200 (). When an approved new animal drug is not used in accordance with its labeling, the use is referred to as being "extralabel." See 21 C.F.R. § 530.3(a) (). Extralabel use "includes, but is not limited to, use in species not listed in the labeling, use for indications (disease or other conditions) not listed in the labeling, use at dosage levels, frequencies, or routes of administration other than those stated in the labeling, and deviation from the labeled withdrawal time based on these different uses." Id.
In its motion for summary judgment, the United States initially took the position that a drug is unsafe under§ 360b if the actual use varies from the FDA-approved use (i.e., an extralabel use) and such different use "(1) is not by or under the lawful order from a licensed veterinarian; or (2) results in any drug residue above an established safe level, safe concentration, or safe tolerance." (Pl.'s Mot. for Summ. J. at 17.) Thus, the opening brief focused solely on extralabel uses. In their response, Defendants asserted that a drug that is used in accordance with the label, but nonetheless results in an above-tolerance residue level, is not "unsafe" under § 360b. In its reply, the United States expanded its position somewhat by arguing that "whether Defendants' use of new animal drugs is on-label or extra-label, those drugs are unsafe under § 360b, and Defendant's food is adulterated under § 342(a)(2)(C)(ii), if such use results in an illegal drug residue." (Pl.'s Reply at 4.) The parties cite no case law, and chambers research reveals none, interpreting the Act with respect to either position.
In paragraph (1), § 360b begins with the following position:
A new animal drug shall, with respect to any particular use or intended use of such drug, be deemed unsafe for purpose of . . . section 342(a)(2)(c)(ii) of this title unless . . . there is in effect an approval of an application filed [with the FDA] with respect to such use or intended use of such drug, and such drug, its labeling, and such use conform to such approved application.
§ 360b(a)(1)(A). Paragraph (4) addresses the safety of a drug when used in an extralabel manner:
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