United States v. Reece

Citation956 F.Supp.2d 736
Decision Date01 July 2013
Docket NumberCriminal No. 12–00146.
PartiesUNITED STATES of America v. Alexander Derrick REECE et al.
CourtUnited States District Courts. 5th Circuit. United States District Courts. 5th Circuit. Western District of Louisiana

OPINION TEXT STARTS HERE

J. Collin Sims, John Luke Walker, U.S. Attorneys Office, Lafayette, LA, for Plaintiff.

Christina Kimball Walker, Todd Alan Foster, Todd Foster Law Group, Tampa, FL, Michael D. Skinner, Skinner Law Firm, Lafayette, LA, for Defendants.

ORDER

ELIZABETH E. FOOTE, District Judge.

Before the Court is the Report and Recommendation of the Magistrate Judge [Record Document 280], addressing Defendant Barry L. Domingue's Motion to Dismiss the Superseding Indictment [Record Document 205].1 For the reasons that follow, the Court hereby adopts the findings of the Report and Recommendation, as clarified in this Order.

The Court finds that the Drug Enforcement Administration (DEA) followed the proper procedures specified under Title 20 U.S.C. § 811(h) to add JWH–018 to schedule I in March 2011. As explained in the Magistrate Judge's Report, Congress explicitly enacted § 811(h) “to create an expedited procedure by which the Attorney General can schedule a substance on a temporary basis when doing so is ‘necessary to avoid an imminent hazard to the public safety [.] 2 In meeting the requirements of § 811(h), the DEA was not required to further comply with the general notice requirements of Title 5 U.S.C. § 801. Despite the Administrator's invocation 3 of the so-called “good cause” provision, codified at 5 U.S.C. § 808(2), the Court agrees with the Magistrate Judge that further discussion of that issue is pretermitted by our finding that the DEA complied with the procedural requirements of § 811(h). No further statutory compliance was required. Thus, JWH–018 was a controlled substance on and after March 1, 2011. Therefore, pursuant to 21 U.S.C. § 813, if AM–2201 is in fact a chemical analogue of JWH–018, it should also be treated as a controlled substance as of that date.

Accordingly, for the reasons stated in the Report and Recommendation and clarified by this Order, and after an independent review of the record, including written objections filed by Defendant Domingue and adopted by Defendants Stanford, Buswell, Reece and Francis, and determining that the findings are correct under the applicable law;

IT IS HEREBY ORDERED that the Motion to Dismiss the Superseding Indictment [Record Document 205] be and is hereby DENIED.

REPORT AND RECOMMENDATION

PATRICK J. HANNA, United States Magistrate Judge.

Currently pending before this Court is the motion to dismiss the superceding indictment that was originally filed by defendant Barry L. Domingue (Rec. Doc. 205) and then adopted by defendants Alexander Derrick Reece (Rec. Doc. 218), Richard Joseph Buswell (Rec. Doc. 222), Daniel Paul Francis (Rec. Doc. 248) and Daniel James Stanford (Rec. Doc. 220). The motion was referred to the undersigned for review, report, and recommendation in accordance with the provisions of 28 U.S.C. § 636 and the standing orders of this Court. (Rec. Doc. 245). For the following reasons, the undersigned recommends that the motion be denied.

Factual Background

The superceding indictment (Rec. Doc. 57) charges the defendants with sixteen substantive counts and also contains a forfeiture allegation. Fourteen counts (Counts 3–16) include one count for money laundering conspiracy and thirteen counts of money laundering, one count is for conspiracy to introduce and cause to be introduced misbranded drugs into interstate commerce (Count 2), and one count (Count 1) is for conspiracy to distribute and possess with the intent to distribute a schedule I controlled substance through application of the analogue statute.

The superceding indictment alleges that, as of March, 2011, the synthetic cannabinoid JWH–018 was a schedule I controlled substance. The other synthetic cannabinoids identified in the indictment are analogues of JWH–018 and include AM–2201, JWH–081, JWH–250, and UR–144. After JWH–018 was added to schedule I, bulk quantities of synthetic cannabinoids were supplied by defendant Reece to a business known as NeutraGenomics which was owned and operated by Defendants Green and Malone. NeutraGenomics supplied the synthetic cannabinoids used to manufacture “Mr. Miyagi” to Pinnacle Products Group. Pinnacle was controlled by defendants Barrow and Espinoza. Pinnacle manufactured Mr. Miyagi and supplied it to Curious Goods. Curious Goods was controlled by defendant Buswell and sold Mr. Miyagi to the public. Mr. Miyagi contained the synthetic cannabinoid AM–2201.

The indictment also alleges that, through a corporation called Retail Compliance Association, defendants Stanford and Francis trained, advised, and instructed franchise owners of defendant Curious Goods LLC and their employees on how to store, display, and sell Mr. Miyagi products, how to detect and evade law enforcement, and how to respond to their customers' questions about Mr. Miyagi.

A controlled substance analogue is a “designer drug” that resembles a controlled substance in molecular structure and actual or intended physiological effect. Schedule I analogues are treated as though they too are listed on the schedule. In Count 1 of the superceding indictment, the defendants are charged with conspiracy to violate 21 U.S.C. § 846, which prohibits the knowing or intentional manufacture, distribution, or dispensing of a controlled substance as well as the possession with intent to manufacture, distribute, or dispense, a controlled substance. Through the application of 21 U.S.C. § 813, the prohibitions of § 846 are extended to the analogues of scheduled substances.

In the instant motion, the defendants seek to have the superceding indictment dismissed, arguing that AM–2201, the synthetic cannabinoid allegedly used in manufacturing Mr. Miyagi, was not an analogue of a scheduled substance at any relevant time because the Drug Enforcement Administration (“DEA”) did not comply with the necessary statutory requirements when five synthetic cannabinoids including JWH–018 were temporarily added to schedule I in March 2011.

The Contentions of the Parties

The defendants argue that JWH–018 was never listed as a schedule I controlled substance because the DEA failed to provide Congress and the Comptroller General with reports required by the Congressional Review Act (“CRA”), 5 U.S.C. § 801 et seq. Consequently, the defendants argue that they cannot be prosecuted for possessing, distributing, or conspiring to possess or distribute Mr. Miyagi, because the AM–2201 in Mr. Miyagi cannot be considered to be an analogue of a scheduled substance since JWH–018 was not properly scheduled. In support of these arguments, the defendants contend that, even though JWH–018 was added to schedule I by means of an order under 21 U.S.C. § 811(h), the DEA was not relieved of its obligation to comply with the CRA's requirement that Congress and the Comptroller General be notified of the proposed revision to schedule I before it occurred. The defendants also argue that the DEA was not entitled to avail itself of the good cause provision of 5 U.S.C. § 808, which, if applied, would have permitted the revised schedule to take effect at such time as the DEA determined. The defendants also review the history of the DEA's scheduling of some other substances, attempting to distinguish the actions taken by the DEA with regard to the five synthetic cannabinoids scheduled in March 2011 and those taken with regard to other substances. The defendants also argue that the DEA's alleged failure to comply with the CRA is subject to judicial review, anticipating the government's argument that judicial review is not permitted. In support of their arguments, the defendants rely in large part upon legislative history for their interpretation of the CRA.

In response to the defendants' motion, the government argues that the good cause provision of the CRA applies and that the DEA's implication of the good cause exception is not subject to judicial review. The government also argues that the five synthetic cannabinoids, including JWH–018, were properly added to schedule I under the procedure set forth in 21 U.S.C. § 811(h).

Analysis

The issue currently before this Court is whether the DEA's failure to notify Congress and the Comptroller General before issuing the March 1, 2011 order adding JWH–018 to schedule I pursuant to 21 U.S.C. § 811(h) precludes prosecution of the defendants with regard to their alleged conspiracy to distribute AM–2201, an analogue of JWH–018.

A. Statutory Construction

The issue presented is one of statutory construction, the defendants contending that the DEA failed to follow certain notice procedures set forth in the Congressional Review Act at 5 U.S.C. § 801(a)(1)(A), resulting in the five synthetic cannabinoids addressed in the March 2011 order not actually being added to schedule I.

As in all cases involving statutory construction, this Court's starting point must be the language used by Congress in crafting the relevant statutes and the assumption that the legislative purpose is expressed by the words used in the statutes.1 This is the starting point because the fundamental tenet of statutory construction is that Congress “says in a statute what it means and means in a statute what it says there.” 2 In other words, [s]tatutory language reflects the intention of Congress, and Congress' intention is the law and must be followed.’ 3 Thus, “when the statute's language is plain, the sole function of the courts—at least where the disposition required by the text is not absurd—is to enforce it according to its terms.” 4

We are rescued from immersion in the sea of legislative history by the general principle that we must not refer to legislative history if the statutory language is clear. This salutary doctrine is predicated upon the notion that since Congress is presumed to have meant what it said, we must look first to the literal meaning of the...

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