FDA has obtained summary judgment and an order of permanent injunction against a Minnesota seafood supplier that was found to have had an inadequate HACCP plan for more than three years, in violation of FDC Act § 402(a)(4) and 21 C.F.R. § 123.6(g). However, the Court's Opinion deals a severe blow to FDA's consistent track record of seeking injunctions that are worded so as to allow FDA to decide by administrative edict that the defendant's business must be shut down, after entry of the Injunction, if FDA believes the company has violated the Injunction.
When FDA and the Justice Department seek injunctions for FDC Act violations, they will frequently seek a partial or total shutdown of the allegedly offending defendant until it can come into compliance with applicable legal requirements. In addition, the standard FDA Consent Decree (and litigated Decree) has provisions governing what occurs when FDA subsequently decides that the Decree has been violated. The typical Decree allows FDA to shut down the allegedly offending company merely by sending the company a letter stating that the company has continued to violate the law. Upon receipt of that letter, the firm is generally required to shutdown its operations, with very limited right to get review from a court of that shutdown demand. This provision is referred to as “letter shutdown authority.”
In this case, although FDA sought letter shutdown authority, the Court turned the standard FDA provision on its head. The Injunction entered by the judge provides that if FDA does not approve of the defendant’s HACCP plan, "and if the FDA wishes to prevent defendants from beginning to operate the proposed business covered by the plan, the FDA must bring" an entirely new enforcement action against the defendant. Thus, unlike the typical Decree, FDA cannot simply shut down a defendant when FDA believes the firm is in violation of the Decree. Instead, the government must file (and prevail in) a second lawsuit against the defendant.
As noted by the court, there is no allegation that the defendant’s products posed any health hazard to consumers. The case is U.S. v. Captain’s Select Seafood, Inc., 2009 WL 398081 (D. Minn.). FDA’s press release is available here.