United States v. Conigliaro
United States v. Conigliaro
Opinion of the Court
*403A scholarly-minded member of the Massachusetts Appeals Court once wrote: "If sheer volume of literature be the measure of fascination, then few subjects have been as intriguing for criminal law scholars as the nexus between the doctrine of impossibility and the crime of attempt." Commonwealth v. Bell ,
Count 3 of the Indictment names Barry Cadden, the former New England Compounding Center (NECC) President, Sharon Carter, its onetime Director of Operations, Alla Stepanets, a pharmacist-cum-shipping clerk, Gregory Conigliaro, NECC's former Vice-President and head of regulatory compliance, and Robert Ronzio, who held the position of National Sales Manager, with conspiring to defraud the Food and Drug Administration (FDA) of its right to have its affairs conducted "free from corruption, fraud, improper and undue influence, dishonesty, unlawful impairment, and obstruction."
This is the second time this court has visited Count 3, although not, as it is now framed, through the prism of the doctrine of legal impossibility. On November 13, 2015, Greg Conigliaro moved to dismiss *404this same Count, arguing that, given the equivocal positions taken by FDA officials on the extent of the agency's regulatory authority, the indictment failed to plead with sufficient clarity conduct " 'plainly and unmistakably' within the province of [the defraud clause of
The renewed motion to dismiss is based on a different proposition-that conceding the factual allegations of the Indictment, including those involving the fraudulent creation of patient prescriptions-accomplishing the goal of the conspiracy was a legal impossibility. As Conigliaro now frames the issue: The testimony and documentary evidence admitted at the trial of Cadden "unequivocally establish[ed] that there [was] no discernible federal law defining any clear distinction between a compounding pharmacy and a drug manufacturer. Thus, it was legally impossible for the FDA to be defrauded in the manner the government [has] alleged." Conigliaro Mem. at 1-2 (Dkt # 1014).
Viewing the Cadden trial evidence in the light most favorable to the government, as the court must in the present context, there was ample prima facie support for the existence of a conspiracy to misrepresent NECC as a compounding pharmacy falling under the presumably less stringent (and certainly less robust) regulatory oversight of the Massachusetts Board of Pharmacy (MABOP). See Gov't Opp'n at 12-16 (Dkt # 1032). On the other hand, the government's prima facie case was answered by the introduction of the testimony of Dr. Margaret Hamburg in hearings before Congress that followed the outbreak of spinal meningitis traced to NECC's contaminated vials of MPA.
This evidence was sufficient to persuade the jury to acquit Cadden of the charge of conspiring to defraud the FDA. As the government's own summary of the evidence and the allegations of the Indictment underscore, the evidence against defendants Conigliaro, Stepanets, and Carter is far weaker than the evidence offered against Cadden. In its specifics, Conigliaro is accused of writing a letter on October 1, 2004 (well outside the statute of limitations and well before the transmogrification of NECC into a compounding behemoth) to the FDA representing NECC as a "compounding-only pharmacy, not a manufacturer." Stepanets is said to have instructed an NECC salesperson in 2010 to avoid using the label "generic" in describing NECC product because "we are not a manufacturer." Aside from these two references to NECC as not a drug manufacturer, the remaining allegations against these three defendants involve their knowledge that the patient names that NECC was being given by its customers and sales force as proof of valid prescriptions were stale, recycled, or fictitious.
Attempts to predict how a jury will decide "have lighted fools the way to dusty death." WILLIAM SHAKESPEARE, MACBETH, act 5, sc. 5. And the rule is ancient and unshakeable that an acquittal of a conspirator at an earlier trial has no conclusive significance for fellow conspirators who face later, separate trials. See, e.g., United States v. Espinosa-Cerpa ,
If this is true, or at least highly probable, why must the gears grind forward with all the wear and tear on defendants, the court, and citizen jurors that a potentially hapless undertaking entails? The answer, which may not be satisfying, is that the law, for better or worse, enshrines more than its share of formalistic precepts. One of the most sacrosanct totems is the rule that, with the rarest of *406exceptions, a court may not usurp the function of the jury by pretermitting a trial based on facts that are not undisputed, stipulated to, capable of judicial notice, or that fall within an exception to the rules of evidence, most notably an exception to the rule against hearsay. See Story Parchment Co. v. Paterson Parchment Paper Co. ,
The evidence that is critical here-the testimony of Commissioner Hamburg, Dr. Woodcock, and other FDA officials, as well as the internal corroborating documents-is within the protected territory of disputed fact and fits under no recognized evidentiary exception that the court can identify, nor is it susceptible to judicial notice.
ORDER
For the foregoing reasons, the motions to dismiss are DENIED. As is its practice in complex civil and criminal cases, the court will issue an order setting time limits on the trial and, to that end, ORDERS the parties to submit their estimates of the total hours, exclusive of opening statements and closing arguments, but inclusive of each party's own cross-examination, that *407it will take to try Count 3 of the Indictment against the remaining defendants. Submissions are to be made on or before October 25, 2017.
SO ORDERED.
Cadden was acquitted of Count 3 by the jury at his trial earlier in 2017. Ronzio pled guilty in 2016.
The Indictment alleges three direct material misrepresentations to the FDA. One, Cadden stated in a May 20, 2003 letter to the FDA that NECC did not comply with the FDA's guidance regarding good manufacturing practices "since we are a compounding pharmacy, not a manufacturer." Indictment ¶ 89. Two, on October 1, 2004, Greg Conigliaro wrote to the FDA describing NECC as "a small-scale, family-run, compounding-only pharmacy, not a manufacturer." Id. ¶ 90. And three, 0n January 5, 2007, Cadden responded to an FDA Warning Letter stating that NECC "dispenses compounded medications [only] upon receipt of valid prescriptions." Id. ¶ 91. See Indictment at 40. It may be worth noting that the drugs at issue, while prescribed, are not scheduled narcotics regulated by the federal Controlled Substances Act.
Dr. Hamburg was initially subpoenaed as a defense witness by Cadden. In resolving a motion to quash, the government agreed in lieu of her personal appearance at trial to the admission of her testimony before the House of Representatives Subcommittee on Oversight and Investigations, Committee on Energy and Commerce, November 14, 2012 & April 16, 2013.
Defendants point to similar Congressional testimony by Dr. Janet Woodcock, the Director of the Center for Drug Evaluation and Research at the FDA, given contemporaneously with that of Dr. Hamburg. Dr. Woodcock testified that there is no clear test for differentiating compounding pharmacies from drug manufactures, particularly as hospitals have been turning to compounding pharmacies as a substitute for an in-house pharmacy. She also acknowledged that much of what NECC was doing in making large batches of anticipatory drugs and shipping them to diverse locations without a prescription was a common practice in the industry, and one that the FDA had no clear authority or jurisdiction to regulate.
The Rules of Evidence allow for a hearsay exception for government records, Rule 803(8), but so far as the court is aware, this rule has never been extended to testimony offered before Congress. The court is particularly reluctant to find the public records exception applicable here, where the factual basis for the conclusions offered in the testimony-and the extent to which those conclusions were the product of a well-reasoned government decision-making process that reflects the views of that government agency, rather than the individual speaker-is not readily apparent. Rule 803 is what I have to work with. Maybe it should be different. At least one highly respected former federal judge might agree. See Richard A. Posner, The Federal Judiciary: Strengths and Weaknesses (Harvard Univ. Press, Cambridge MA 2017) at 355-362. Next, judicial notice may only be taken of facts that are not subject to reasonable dispute. See Fed. R. Evid. 201 (b) (defining a judicially noticeable fact as "one not subject to reasonable dispute in that it is either (1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned."). The issue of the FDA's jurisdiction over compounding pharmacies is precisely what is in dispute in this case. See United States v. Hoyts Cinemas Corp. ,
On this issue, I reserve judgment. Perhaps the government has some additional evidence on the FDA's assessment of its legal position with respect to its ability to regulate compounding pharmacies like NECC that for some reason it chose to withhold in the Cadden trial.
Reference
- Full Case Name
- United States v. Gregory A. CONIGLIARO, Alla Stepanets, and Sharon Carter
- Cited By
- 1 case
- Status
- Published