FDA Cites Park Doctrine in a Different ContextMay 28, 2013
By Paul M. Hyman –
As we have discussed previously, the Park doctrine allows the government to seek a misdemeanor conviction against a company official for alleged violations of the Federal Food, Drug, and Cosmetic Act ("FDCA") without having to prove that the official participated in or was even aware of the violations. The government need only demonstrate that the official was in a position of authority to prevent or correct the alleged violation. The Park doctrine, in effect, renders FDCA violations strict liability crimes for corporate officials in positions of responsibility or authority.
Several FDA Warning Letters, issued last month and this month, appear to be the first letters in recent memory in which FDA has cited United States v. Park and its predecessor, United States v. Dotterweich. On closer reading, however, the recent letters do not cite the Park doctrine for the usual theory of strict liability for company officials or even as a clear threat to prosecute individuals. The letters, instead, appear to cite Park and Dotterweich to make a point about vicarious liability.
Each letter was addressed to a dietary supplement distributor. The letters cite Park and Dotterweich to support the legal theory that a distributor that uses contract manufacturers or labelers may be liable (or convictable) for Current Good Manufacturing Practice ("CGMP") violations by its contractors. The letters state as follows:
Although your firm may contract out certain dietary supplement manufacturing operations, it cannot . . . contract out its ultimate responsibility to ensure that the dietary supplement it places into commerce (or causes to be placed into commerce) is not adulterated for failure to comply with dietary supplement CGMP requirements (see United States v. Dotterweich, 320 U.S. 277, 284 (1943) (explaining that an offense can be committed under the Act by anyone who has “a responsible share in the furtherance of the transaction which the statute outlaws”); United States v. Park, 421 U.S. 658, 672 (1975) (holding that criminal liability under the Act does not turn on awareness of wrongdoing, and that “agents vested with the responsibility, and power commensurate with that responsibility, to devise whatever measures are necessary to ensure compliance with the Act” can be held accountable for violations of the Act)[)]. . . .The Act prohibits a person from introducing or delivering for introduction, or causing the delivery or introduction, into interstate commerce a dietary supplement that is adulterated under section 402(g) for failure to comply with dietary supplement CGMP requirements. . . . Thus, a firm that contracts with other firms to conduct certain dietary supplement manufacturing, packaging, and labeling operations for it is responsible for ensuring that the product is not adulterated for failure to comply with dietary supplement CGMP requirements, regardless of who actually performs the dietary supplement CGMP operations.
The idea that a distributor might be responsible for CGMP violations by its contract manufacturers or labelers is, of course, nothing new. The letters include, almost verbatim, statements about distributor liability from the 2007 FDA notice announcing the final dietary supplement CGMPs. The citations to the Park doctrine simply appear to add teeth to the prior guidance and possibly suggest (or hint) – without any overt discussion – that a distributor and its officers might be held liable.
That a company official could be convicted of a misdemeanor based on the acts of a third party contractor appears possible under the Park doctrine. While Park involved an officer’s vicarious liability for his own company’s acts, Dotterweich involved an officer’s vicarious liability for the acts of third party manufacturers. Despite the facts of the 70 year-old Dotterweich decision, however, the conviction of an officer for third party acts is not a foregone conclusion – especially at this point.
Both Park and Dotterweich were split decisions with strong dissents. Moreover, as we have pointed out previously, what is a misdemeanor now is much more serious than what it was even 20 years ago in terms of potential monetary penalties and prison sentences. If the penalty sought against a corporate official appears particularly severe – or the alleged FDCA violation appears more technical than dangerous – juries and courts may be wary of finding guilt based on strict liability. By the same token, the more tenuous the connection appears between an official and those who actually violated the FDCA, the more juries and courts may be willing to cut off vicarious liability.