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United States v. Mosinee Research Corp.

decided: August 18, 1978.


Appeal from the United States District Court for the Eastern District of Wisconsin. No. 77-C-285 - John W. Reynolds, Judge.

Before Cummings and Tone, Circuit Judges, and Campbell, Senior District Judge.*fn*

Author: Tone

This is an appeal from a preliminary injunction restraining continued violations of the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. § 331(a), (d), (k), and (p). The violations consisted of the manufacture and distribution in interstate commerce of amygdalin, otherwise known as Laetrile, which was found to have been misbranded and adulterated. We affirm.

Pursuant to a complaint for forfeiture and injunction filed by the government, the United States Marshal seized from defendant U. S. Pharmaceuticals, Inc.'s premises in Manitowoc, Wisconsin, quantities of whole and ground apricot kernels, powdered and "clumped" amygdalin, and gelatin capsules, all of which were materials used in the manufacture of amygdalin, otherwise known as Laetrile. The government thereafter filed an amended complaint, Count I of which requested forfeiture and condemnation of the seized articles pursuant to 21 U.S.C. § 334(a), and Count II of which sought injunctive relief against U. S. Pharmaceuticals and the other defendants, prohibiting them from further manufacture and distribution of articles of food and drug like those seized, pursuant to 21 U.S.C. § 332(a).

The court held a hearing on the issue of whether a preliminary injunction should be issued under Count II of the complaint. Numerous witnesses, including experts, testified, and many exhibits were received. Following the hearing the court entered findings of fact and conclusions of law, and issued the preliminary injunction which is the subject of this appeal.

Subsequent to the issuance of the injunction, the marshal seized amygdalin tablets bottled for sale at the office of defendant Product Distributors Co. On December 1, 1977, the District Court stayed pending appeal that part of the preliminary injunction relating to destruction of materials seized. The court declined to stay the other provisions of the injunctive order. United States v. Articles of Food and Drug, 441 F. Supp. 772 (E.D.Wis.1977).


Defendants' first argument is that the District Court improperly determined that amygdalin was a "new drug." It is apparently defendants' position that only the Food and Drug Administration has jurisdiction to determine in the first instance whether an article is a "new drug."

Nothing in the Weinberger cases on which defendants rely, Weinberger v. Bentex Pharmaceuticals, Inc., 412 U.S. 645, 93 S. Ct. 2488, 37 L. Ed. 2d 235 (1973), and Weinberger v. Hynson, Westcott, and Dunning, Inc., 412 U.S. 609, 93 S. Ct. 2469, 37 L. Ed. 2d 207 (1973), supports the proposition that a district court does not have jurisdiction to determine whether an article is a "new drug" under circumstances such as those present in the case at bar. The Weinberger cases, which also include CIBA Corp. v. Weinberger, 412 U.S. 640, 93 S. Ct. 2495, 37 L. Ed. 2d 230 (1973), and USV Pharmaceutical Corp. v. Weinberger, 412 U.S. 655, 93 S. Ct. 2498, 37 L. Ed. 2d 244 (1973), recognize primary jurisdiction in the Food and Drug Administration to decide the "new drug" issue, subject only to direct judicial review when administrative remedies have been exhausted. That issue may not be relitigated in a judicial proceeding. In the CIBA case, the Court recognized that the Act provides FDA with "a second line of defense civil injunction proceedings, criminal penalties, and In rem seizure and condemnation," 412 U.S. at 644, 93 S. Ct. at 2498, and went on to say,

Cases may arise where there has been no formal administrative determination of the "new drug" issue, it being first tendered to a district court. Even then, however, the district court might well stay its hand, awaiting an appropriate administrative determination of the threshold question.

412 U.S. at 644, 93 S. Ct. at 2498. The Court does not say that the district court must stay its hand. It is inconceivable that Congress intended that, when a preliminary injunction is sought under 21 U.S.C. § 332(a) to protect public health, the district court would be unable to act until the lengthy administrative proceedings necessary to determine the "new drug" issue have been completed.

Defendants have also argued that the United States District Court for the Western District of Oklahoma determined in Rutherford v. United States, 438 F. Supp. 1287 (1977), that amygdalin is not a "new drug" and that the FDA is bound by that determination. Since the submission of the case at bar, however, the district court's decision in Rutherford has been reviewed by the Tenth Circuit, which has in effect set aside the district court's determination that Laetrile is not a "new drug." Rutherford v. United States, 582 F.2d 1234 (10th Cir. 1978). In Rutherford the plaintiffs were a class of terminally ill cancer patients. The Tenth Circuit held "that the "safety' and "effectiveness' requirements of the statute as now written have no application to terminally ill cancer patients who desire to take the drug intravenously." The injunction which the district court had issued on the basis of its finding that Laetrile was not a "new drug" was modified in conformity with the Tenth Circuit's limited holding. Accordingly, we need not consider what effect a final judgment in that case that Laetrile is not a "new drug" would have had on the case at bar.

We note that before the commencement of the instant action, Laetrile had been determined to be a "new drug" in four other actions. United States v. Spectro Foods Corp., No. 76-101 (D.N.J., Jan. 29, 1976), Aff'd in part and rev'd in part, 544 F.2d 1175 (3rd Cir. 1976); Hanson v. United States, 417 F. Supp. 30 (D.Minn.1976), Aff'd, 540 F.2d 947 (8th Cir. 1976); Gadler v. United States, 425 F. Supp. 244 (D.Minn.1977); See also United States v. General Research Labs, 397 F. Supp. 197, 199 (C.D.Cal.1975); In re Morgan v. Matthews, No. 76-1637 (D.S.C., Nov. 30, 1976).*fn1

The District Court had jurisdiction to consider the "new drug" status of amygdalin for purposes of the enforcement proceeding before it and properly exercised that ...

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