Case: 18-11168 Date Filed: 09/20/2019 Page: 1 of 21
[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 18-11168
Non-Argument Calendar
________________________
Agency No. 15-17
PHARMACY DOCTORS ENTERPRISES, INC.,
d.b.a. Zion Clinic Pharmacy,
Petitioner,
versus
DRUG ENFORCEMENT ADMINISTRATION,
Respondent.
________________________
Petition for Review of a Decision of the
Drug Enforcement Agency
________________________
(September 20, 2019)
Before MARCUS, ROSENBAUM and JILL PRYOR, Circuit Judges.
PER CURIAM:
Case: 18-11168 Date Filed: 09/20/2019 Page: 2 of 21
Pharmacy Doctors Enterprises, Inc. (“Pharmacy Doctors”), a retail
pharmacy, petitions for review of a decision by the Acting Administrator of the
U.S. Drug Enforcement Administration (DEA) pursuant to the Controlled
Substances Act (“CSA”), to revoke its registration to dispense controlled
substances and deny any pending application for renewal of registration.1
21 U.S.C. §§ 823(f), 824(a). The Acting Administrator revoked Pharmacy
Doctors’ registration after a hearing before an administrative law judge (ALJ)
revealed that it had filled prescriptions for controlled substances in violation of
federal and state law and that its owner and operator, Veronica Taran, exhibited
ignorance of her legal and professional duties as a pharmacist. Pharmacy Doctors
argues that the ALJ presiding at the hearing was improperly appointed under the
Appointments Clause, the Acting Administrator lacked substantial evidence for his
findings, and his revocation of Pharmacy Doctors’ registration was arbitrary and
capricious. After careful consideration, we deny the petition for review.
I. FACTUAL, PROCEDURAL, AND STATUTORY BACKGROUND
The CSA makes it “unlawful for any person knowingly or intentionally . . .
to . . . distribute[] or dispense . . . a controlled substance” except “as authorized” by
the CSA.
Id. § 841(a)(1). One of the CSA’s exceptions is for pharmacies
1
Pharmacy Doctors Enters. d/b/a Zion Clinic Pharmacy Decision and Order, 83 Fed.
Reg. 10,876, 10,903 (DEA, Mar. 13, 2018).
2
Case: 18-11168 Date Filed: 09/20/2019 Page: 3 of 21
registered with the Attorney General,
id. § 822(a), which may “dispense” or
“deliver a controlled substance to an ultimate user . . . pursuant to the lawful order
of[] a practitioner,”
id. § 802(10). By DEA regulation, a lawful order of a
practitioner is one that is “issued for a legitimate medical purpose by an individual
practitioner acting in the usual course of his professional practice.” 21 C.F.R.
§ 1306.04(a). That regulation imposes a responsibility on the prescriber to ensure
prescriptions comply with the law and also a “corresponding responsibility” on the
“pharmacist who fills the prescription” to ensure that the prescription is valid.
Id.
A pharmacist who “knowingly fill[s]” a prescription not issued “for a legitimate
medical purpose by an individual practitioner acting in the usual course of his
professional practice” is subject to penalties under the CSA.
Id.
The Attorney General has delegated to the DEA Administrator the authority
to issue, deny, suspend, and revoke pharmacy registrations. 28 C.F.R. § 0.100(b).
Registration may be denied or revoked when it is or would be “inconsistent with
the public interest.” 21 U.S.C. §§ 823(f), 824(a)(4).
Here, the DEA served on Pharmacy Doctors an order to show cause, see
id.
§ 824(c)(1); 21 C.F.R. § 1301.37, alleging that Pharmacy Doctors was dispensing
controlled substances in violation of federal and state law and proposing to revoke
its registration, 21 U.S.C. § 824(a)(4), and deny any pending application for
renewal of its registration,
id. § 823(f).
3
Case: 18-11168 Date Filed: 09/20/2019 Page: 4 of 21
As was its right under the CSA and the Administrative Procedure Act
(APA), Pharmacy Doctors requested a hearing, see
id. § 824(c)(4); 5 U.S.C.
§ 554(c)(2); 21 C.F.R. §§ 1301.37(d), 1301.41(a), at which the parties presented
documentary evidence and the ALJ heard testimony from the government’s expert
Tracey Gordon, Pharmacy Doctors’ expert Louis Fisher, Taran, and a DEA
investigator. We describe the relevant aspects of the evidence and testimony in
Part III. After the hearing, the ALJ recommended that the Acting Administrator
revoke Pharmacy Doctors’ registration and deny any pending applications for
renewal because registration would be “inconsistent with the public interest.”
21 U.S.C. §§ 823(f), 824(a)(4).
The Acting Administrator agreed with the ALJ and issued an order revoking
Pharmacy Doctors’ registration and denying any pending applications for renewal.
Pharmacy Doctors petitioned for review of the Acting Administrator’s decision.2
Id. § 877.
II. STANDARDS OF REVIEW
We review de novo questions of law, including the constitutionality of the
ALJ’s appointment. Sec. & Exch. Comm’n v. Graham,
823 F.3d 1357, 1360 (11th
Cir. 2016).
2
In its briefing on appeal, Pharmacy Doctors does not challenge the Acting
Administrator’s decision to deny any pending application to renew its registration. See
21 U.S.C. § 823(f).
4
Case: 18-11168 Date Filed: 09/20/2019 Page: 5 of 21
“The Acting Administrator’s factual findings are conclusive if supported by
substantial evidence.” Jones Total Health Care Pharmacy, LLC v. Drug Enf’t
Admin.,
881 F.3d 823, 829 (11th Cir. 2018) (citing 21 U.S.C. § 877). Substantial
evidence, which is a standard lower than a preponderance of the evidence, is “such
relevant evidence as a reasonable person would accept as adequate to support a
conclusion.”
Id. “An administrative agency’s finding is supported by substantial
evidence even if two inconsistent conclusions could be drawn from the evidence.”
Id. (alteration adopted) (internal quotation marks omitted).
Under the APA, we may set aside the Acting Administrator’s final decision
if it is “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance
with law,” “contrary to [a] constitutional right,” or “unsupported by substantial
evidence.” 5 U.S.C. § 706(2)(A)-(B), (E). “The arbitrary and capricious standard
is exceedingly deferential.” Jones
Total, 881 F.3d at 829 (internal quotation marks
omitted). “We may not substitute our judgment for that of the agency so long as its
conclusions are rational and based on the evidence before it.”
Id. “Nevertheless,
we may set aside a decision as arbitrary and capricious when, among other flaws,
the agency has relied on factors [that] Congress has not intended it to consider,
entirely failed to consider an important aspect of the problem, or offered an
explanation for its decision that runs counter to the evidence before the agency.”
Id. (alteration adopted) (internal quotation marks omitted).
5
Case: 18-11168 Date Filed: 09/20/2019 Page: 6 of 21
III. DISCUSSION
Pharmacy Doctors raises three grounds for why we should set aside the
Acting Administrator’s decision: (1) the ALJ who presided over the hearing was
invalidly appointed under the Appointments Clause; (2) the Acting Administrator
lacked substantial evidence for his factual findings; and (3) the Acting
Administrator’s decision to revoke Pharmacy Doctors’ registration was arbitrary
and capricious. We reject each argument and accordingly deny Pharmacy Doctors’
petition for review.
A. We Decline to Excuse Pharmacy Doctors’ Forfeiture of its Appointments
Clause Argument.
The Appointments Clause requires that “Officers of the United States” be
appointed by the President, a court of law, or a head of a department. U.S. Const.,
art. II, § 2, cl. 2. Citing a recent Supreme Court case holding that ALJs of the
Securities and Exchange Commission are “Officers of the United States” whose
appointments must comply with the Appointments Clause, see Lucia v. S.E.C.,
138 S. Ct. 2044, 2049, 2054 (2018), Pharmacy Doctors argues that DEA ALJs are
also “Officers of the United States” whose appointments must comply with the
Clause. Because the ALJ who presided over the hearing was not appointed by the
6
Case: 18-11168 Date Filed: 09/20/2019 Page: 7 of 21
President, a court of law, or a department head, Pharmacy Doctors contends, a
remand for a new hearing before a properly appointed ALJ is required.
Pharmacy Doctors concedes, however, that it failed to timely challenge the
validity of the ALJ’s appointment. “Under ordinary principles of administrative
law, a reviewing court will not consider arguments that a party failed to raise in
timely fashion before an administrative agency.” Mahon v. U.S. Dep’t of Agric.,
485 F.3d 1247, 1254 (11th Cir. 2007) (internal quotation marks omitted).
“[W]here the parties are expected to fully develop the issues during the course of
an adversarial administrative proceeding, the rationale for requiring issue
exhaustion is at its strongest.”
Id. at 1255.
“Although there is no express issue exhaustion requirement in the [CSA or
DEA] regulations, a review of the [CSA and DEA regulations] reveals that [DEA]
proceedings are ‘adversarial’ in nature.”
Id. at 1256. Under the supervision of the
DEA Administrator, the ALJ may subpoena and compel the attendance and
testimony of witnesses, require the production of records relevant to an
investigation, administer oaths, and receive evidence. 21 U.S.C. §§ 875(a), 876(a);
see also 28 C.F.R. § 0.100(b). Parties may present “[e]xtensive argument” in
“opening [and] closing statements[,] . . . memoranda[,] [and] proposed findings of
fact and conclusions of law.” 21 C.F.R. § 1301.42. The government bears the
burden to show that registration violates or would violate the CSA.
Id.
7
Case: 18-11168 Date Filed: 09/20/2019 Page: 8 of 21
§ 1301.44(d)-(e). And the DEA Administrator’s order denying or revoking a
registration must “include the findings of fact and conclusions of law upon which
the order is based.”
Id. § 1301.46; see also
Mahon, 485 F.3d at 1249, 1256
(considering similar features of the U.S. Department of Agriculture’s process for
evaluating applications for federal disaster assistance to determine whether that
process was “‘adversarial’ in nature”).
Given these features, the DEA’s “procedures provide an adversarial system
in which parties are given a full and fair opportunity to make their arguments and
present evidence, and, as a corollary, to attempt to challenge the arguments and
evidence presented by the agency.”
Id. at 1256. “As such, the adversarial nature
of the administrative proceedings counsel against allowing [Pharmacy Doctors] to
raise [a] new argument[] that w[as] not raised during the course of [its]
administrative appeal” to the Acting Administrator.
Id. Because arguments based
on the Appointments Clause are nonjurisdictional and therefore subject to the
ordinary rules of forfeiture, see Freytag v. Comm’r,
501 U.S. 868, 878-79 (1991);
see also
id. at 893-94 (Scalia, J., concurring in part and concurring in judgment),
we conclude that Pharmacy Doctors has forfeited its Appointments Clause
challenge.
We reject Pharmacy Doctors’ argument that we should excuse its forfeiture
based on Jones Bros. v. Secretary of Labor,
898 F.3d 669 (6th Cir. 2018), in which
8
Case: 18-11168 Date Filed: 09/20/2019 Page: 9 of 21
the Sixth Circuit excused a forfeiture of an Appointments Clause challenge to a
Federal Mine Safety and Health Review Commission ALJ’s authority to uphold
civil penalties.
Id. at 672. Even if we assume that the Sixth Circuit’s approach
was sound, two facts distinguish this case. First, the statute at issue in Jones
Brothers explicitly permitted excusal in “extraordinary circumstances.” 30 U.S.C.
§ 816(a)(1). Pharmacy Doctors cites and we have found no analogous provision in
the CSA. Second, Jones Brothers raised, at least in a cursory manner, its
Appointments Clause challenge in its appeal of the ALJ’s decision to the
Commission. Jones
Bros., 898 F.3d at 673, 678. In contrast, Pharmacy Doctors
failed to make even a cursory argument regarding the Appointments Clause to the
Acting Administrator. Pharmacy Doctors’ reliance on Jones Brothers thus fails to
aid its argument that we should excuse its forfeiture.
Likewise, Pharmacy Doctors’ argument that its Appointments Clause
challenge was unavailable before the Supreme Court decided Lucia is without
merit. The availability of an argument does not depend on whether a court has
already issued a decision addressing that exact argument. Moreover, the Supreme
Court held that Freytag, a case decided 24 years before the DEA served the order
to show cause on Pharmacy Doctors, “sa[id] everything necessary to decide” the
Appointments Clause challenge at issue in
Lucia, 138 S. Ct. at 2053, so Pharmacy
9
Case: 18-11168 Date Filed: 09/20/2019 Page: 10 of 21
Doctors may not credibly argue that an Appointments Clause challenge was
unavailable when it appeared before the DEA.
B. Substantial Evidence Supports the Acting Administrator’s Factual
Findings.
As noted above, the Acting Administrator may revoke a pharmacy’s
registration under the Controlled Substances Act when the pharmacy “has
committed such acts as would render [its] registration . . . inconsistent with the
public interest.” 21 U.S.C. § 824(a)(4); see also
id. § 823(f). “The government
bears the initial burden of proving that registration is inconsistent with the public
interest.” Jones
Total, 881 F.3d at 830 (citing 21 C.F.R. § 1301.44(d)-(e)). “If the
government proves its prima facie case, the burden of proof shifts to the registrant
to show why it can be trusted with a registration.”
Id. Pharmacy Doctors contends
that the Acting Administrator lacked substantial evidence for his findings that
(1) the government made out a prima facie case that continued registration would
be “inconsistent with the public interest,” 21 U.S.C. §§ 823(f), 824(a)(4), and
(2) Pharmacy Doctors failed to rebut the government’s prima facie case by
accepting responsibility. We disagree.
1. The Government’s Prima Facie Case
To determine whether the government has made a prima facie case that
continued registration or granting an application would be inconsistent with the
10
Case: 18-11168 Date Filed: 09/20/2019 Page: 11 of 21
public interest, the Acting Administrator must consider five statutory factors,
“though he need not make explicit findings as to each one and [may] give each
factor the weight he determines is appropriate.” Jones
Total, 881 F.3d at 830
(alteration adopted) (internal quotation marks omitted); 21 U.S.C. § 823(f)
(statutory factors). Here, the Acting Administrator made explicit findings as to
two of the factors: “[t]he applicant’s experience in dispensing[] or conducting
research with respect to controlled substances” and “[c]ompliance with applicable
State, Federal, or local laws relating to controlled substances.”
Id. § 823(f)(2), (4).
After detailing five ways in which Pharmacy Doctors had violated federal and state
law, the Acting Administrator determined that the government met its prima facie
burden to show that continued registration would be “inconsistent with the public
interest.”
Id. § 824(a)(4). Substantial evidence supports each of these five
findings.3
First, Pharmacy Doctors violated a DEA regulation requiring pharmacists to
store controlled substance prescriptions in a “readily retrievable” manner.
21 C.F.R. § 1304.04(h)(3)-(4); see also
id. § 1300.01(b) (defining “[r]eadily
retrievable”). When a DEA investigator requested during an unannounced
inspection to see several prescriptions Pharmacy Doctors had filled within the
previous two years, it was unable to retrieve them. Second, Pharmacy Doctors
3
Unless otherwise noted, all facts described in Part III.B of our opinion are undisputed.
11
Case: 18-11168 Date Filed: 09/20/2019 Page: 12 of 21
shipped controlled substances out of state without complying with those states’
non-resident pharmacy licensing requirements. Third, Pharmacy Doctors filled
controlled substance prescriptions that lacked basic identifying information about
the patient, prescriber, the drug, and instructions for its use, despite a DEA
regulation requiring pharmacists to ensure that all prescriptions bore this
information. See
id. § 1306.05(a), (f). Fourth, Pharmacy Doctors failed to report
several controlled substance prescriptions to Florida’s electronic drug-monitoring
system, in violation of Florida law. Fla. Stat. § 893.055. That each of these facts
is undisputed shows that the Acting Administrator had substantial evidence to
support these findings.
Fifth, Pharmacy Doctors failed to comply with its “corresponding
responsibility,” noted above in Part I, to ensure that it filled only those
prescriptions “issued for a legitimate medical purpose by an individual practitioner
acting in the usual course of his professional practice.” 21 C.F.R. § 1306.04(a).
The government sought to prove that Pharmacy Doctors violated its corresponding
responsibility by engaging in conduct that amounted to willful blindness: filling
prescriptions even though they raised “red flags”—indicia that the prescription was
not issued for a legitimate medical purpose and would likely be diverted to non-
medical uses. See Jones
Total, 881 F.3d at 828.
12
Case: 18-11168 Date Filed: 09/20/2019 Page: 13 of 21
For example, Pharmacy Doctors filled: several prescriptions presented by
customers traveling hundreds of miles roundtrip; in fewer than two hours, several
prescriptions written by the same doctor on the same day for the same strength of
the same drug; within five minutes, two prescriptions written by the same doctor
on the same day for the same drug for two individuals with the same last name and
street address; several prescriptions for two drugs that, taken together, would make
a “cocktail” for recreational rather than medical use; and several prescriptions at
least five days before the customers should have finished their previous
prescription, including 12 prescriptions for one customer for the same drug within
a span of four months. In addition, Pharmacy Doctors accepted cash in exchange
for filling at least 50 prescriptions; in at least one instance, it increased the price by
over $150 for the same quantity of the same drug sold to the same customer less
than a month later. According to Gordon, the price increase indicated that Taran
knew the drug would be diverted and that she was taking advantage of a customer
who would pay any price to obtain the drug.
Many of the prescriptions detailed above were for Dilaudid, the brand name
version of hydromorphone, a Schedule II opiate that Taran admitted was a “high
risk medication” subject to “a lot of diversion.” Gov’t App’x, Tr. at 1116, 1129;
see also 21 C.F.R. § 1308.12(b)(vii).
13
Case: 18-11168 Date Filed: 09/20/2019 Page: 14 of 21
With one exception,4 Gordon and Fisher both testified that each of the
examples of alleged red flags did indeed raise red flags. Rather than taking and
documenting steps to resolve these red flags or refusing to fill prescriptions with
unresolvable red flags, however, Pharmacy Doctors filled all of these prescriptions
without submitting any documentation that it had resolved the red flags. Pharmacy
Doctors’ awareness of the risk of diversion combined with its failure to take
meaningful steps to ensure that the prescriptions it filled were for legitimate
medical uses together demonstrate willful blindness to how its dispensing practices
facilitated diversion. Therefore, substantial evidence supports the Acting
Administrator’s finding that Pharmacy Doctors failed to comply with its
corresponding responsibility not to fill prescriptions written for illegitimate
purposes.
Id. § 1306.04(a).
None of Pharmacy Doctors’ counterarguments regarding the government’s
prima facie case undermines or contradicts the substantial evidence summarized
above. Pharmacy Doctors argues that it resolved red flags by speaking to the
prescribing practitioners, but Taran admitted that she did not always speak with the
prescribing doctors when red flags were present. It also argues that it checked
4
Regarding the allegation that Pharmacy Doctors filled prescriptions that would enable
customers to make drug cocktails for non-medical uses, Fisher thought that, to be a cocktail, a
third drug was required. Nevertheless, he admitted that Pharmacy Doctors would not know if
customers obtained the third drug from another pharmacy because it lacked access to Florida’s
electronic drug-monitoring system.
14
Case: 18-11168 Date Filed: 09/20/2019 Page: 15 of 21
prescribers’ medical licenses and DEA registration, had customers sign affidavits
to verify their relationship with the prescribing doctor, and tried to verify that the
prescribers’ signatures matched the signatures on the prescriptions. Yet it offers no
explanation for how these steps ensured that it filled only those prescriptions
issued for legitimate medical purposes.
Next, Pharmacy Doctors protests that no Florida law required documentation
of a red flag, but regardless of whether that is true, the prevailing professional
standard as attested to by both Gordon and its own expert, Fisher, was that
pharmacists should document their resolution of red flags. Therefore, substantial
evidence supports the Acting Administrator’s finding that Pharmacy Doctors’
failure to document its resolution of red flags was part and parcel of its failure to
comply with the “corresponding responsibility” requirement.
Id.
In addition, Pharmacy Doctors avers that the DEA itself has held that the
lack of documentation of resolution of a red flag is “not evidence that a pharmacist
failed to resolve a red flag.” Appellant’s Br. at 53. This is false. Although the
DEA has held that a lack of documentation of resolution of a red flag on the
prescription itself is not conclusive proof of failure to resolve the red flag, those
decisions make clear that the absence of any documentation of resolution of a red
flag is probative of a failure to resolve it. See Hills Pharmacy, LLC Decision and
Order, 81 Fed. Reg. 49,816, 49,836 (DEA July 28, 2016) (“[T]he absence of
15
Case: 18-11168 Date Filed: 09/20/2019 Page: 16 of 21
documentation on the prescriptions is clearly probative evidence that Respondent’s
pharmacists failed to resolve the strong suspicion presented by many of the
prescriptions . . . .”); Superior Pharmacy I & Superior Pharmacy II Decision and
Order, 81 Fed. Reg. 31,310, 31,335 (DEA May 18, 2016) (“[I]t would be
reasonable to draw an adverse inference that a pharmacist failed to resolve a red
flag (or flags) from the failure to document the resolution in any manner . . . .”).
Pharmacy Doctors also contends that the Acting Administrator’s reliance on
DEA decisions published after the conduct at issue here had ended was arbitrary
and capricious because it lacked notice of those decisions. We reject this argument
because the determination of whether Pharmacy Doctors had notice of a particular
professional obligation relevant to the “corresponding responsibility” requirement,
21 C.F.R. § 1306.04(a), depends not on whether the DEA happens to have
published a decision that recognizes a certain practice as a professional standard
but instead on the facts adduced in the agency proceeding. Here, the Acting
Administrator had substantial undisputed evidence to support his finding that
Pharmacy Doctors failed to comply with prevailing professional standards as
attested to by both Gordon and its own expert, Fisher.
Lastly, Pharmacy Doctors’ efforts to distinguish its conduct from the
conduct at issue in DEA decisions predating the hearing are also meritless. To
16
Case: 18-11168 Date Filed: 09/20/2019 Page: 17 of 21
make out a prima facie case, the government need not review patient files. 5 Nor
does the government need to prove that Pharmacy Doctors’ misconduct was
similar to misconduct committed by other pharmacies sanctioned by the DEA,
such as: two people served by a pharmacy died the day after it dispensed
controlled substances, the pharmacist was told by customers that other pharmacies
would not fill the same prescriptions, customers traveled from out of state to
patronize the pharmacy, the pharmacist-in-charge admitted that customers might
be reselling their pills, the pharmacy refilled prescriptions without prescriber
authorization, or customers were doctor-shopping. 6 These are distinctions without
a difference. A pharmacist can violate the “corresponding responsibility”
requirement even if none of these specific facts characterizes its own conduct.
Id.
All of Pharmacy Doctors’ counterarguments regarding the government’s prima
facie case are meritless.
In sum, given the plentiful instances of Pharmacy Doctors breaking federal
and state law in filling prescriptions with indicia that the drugs would be used for
5
George C. Aycock, M.D. Revocation of Registration, 74 Fed. Reg. 17,529, 17,533,
17,542 (DEA, Apr. 15, 2009).
6
See East Main St. Pharmacy Affirmance of Suspension Order, 75 Fed. Reg. 66,149,
66,155, 66,164 (DEA Oct. 27, 2010) (customers died; pharmacy knew other pharmacies refused
to fill same prescriptions); Holiday CVS, L.L.C., d/b/a CVS/Pharmacy Nos. 219 & 5195 Decision
and Order, 77 Fed. Reg. 62,316, 62,318, 62,330 (DEA Oct. 12, 2012) (customers traveled from
out of state; pharmacy knew customers might be reselling pills); Grider Drug #1 & Grider Drug
#2 Decision and Order, 77 Fed. Reg. 44,070, 44,073-74, 44,099 (DEA July 26, 2012) (pharmacy
refilled prescriptions without prescriber authorization; customers were doctor-shopping).
17
Case: 18-11168 Date Filed: 09/20/2019 Page: 18 of 21
non-medical uses, substantial evidence supports the Acting Administrator’s
findings that Pharmacy Doctors’ conduct was “egregious” and that its “experience
in dispensing” and “compliance with applicable State[] [and] Federal . . . laws
relating to controlled substances” counseled against registration. 21 U.S.C.
§§ 823(f)(2), (4).7 Thus the Acting Administrator properly found that the
government met its burden to show a prima facie case that continued registration
would be “inconsistent with the public interest.”
Id. § 824(a)(4).
2. Pharmacy Doctors’ Rebuttal
“[T]he DEA may properly consider a registrant’s acceptance of
responsibility in determining if registration should be revoked.” Jones
Total,
881 F.3d at 830. “If a pharmacy has failed to comply with its responsibilities in
the past, it makes sense for the agency to consider whether the pharmacy will
change its behavior in the future.”
Id. at 831.
Substantial evidence supports the Acting Administrator’s finding that
Pharmacy Doctors failed to accept responsibility. For example, Taran denied that
red flags arose from customers traveling long distances to fill prescriptions and
multiple customers from the same address presenting the same prescriptions—even
7
Pharmacy Doctors argues that it complied with Florida law’s requirements for
dispensing controlled substances and needed to do no more to comply with the CSA. Having
failed to raise this argument to the agency, Pharmacy Doctors has forfeited it, and we decline to
address it. See
Mahon, 485 F.3d at 1254-56.
18
Case: 18-11168 Date Filed: 09/20/2019 Page: 19 of 21
though Gordon and Fisher both agreed that these were red flags. Taran’s “refusal
to admit that [Pharmacy Doctors’] dispensing practices violated its obligations
under federal law . . . supports the factual finding . . . that [Taran] did not fully
understand her legal obligations as a pharmacist.” Jones
Total, 881 F.3d at 832;
see also 21 C.F.R. § 1306.04(a). It is not “unreasonable for the DEA to expect a
pharmacist entrusted with dispensing highly regulated, addictive, and potentially
destructive substances to fully understand her obligations under the law.” Jones
Total, 881 F.3d at 832.
Moreover, when asked to describe the conduct for which she accepted
responsibility, Taran’s only response at the hearing was that she “d[id]n’t have any
intention to violate DEA rules.” Appellant’s App’x, Tab 8, Tr. at 1025. But Taran
“could have maintained that the misconduct was not intentional while, at the same
time, recognizing . . . that it nonetheless violated the pharmacy’s obligations under
the CSA. . . . [H]er failure to clearly acknowledge even unintentional misconduct
demonstrated a lack of understanding of her legal obligations.” Jones
Total,
881 F.3d at 833.
“Because the record supports the Acting Administrator’s findings that
[Taran] . . . did not understand the scope of her responsibilities under the CSA, we
conclude that the [Acting Administrator’s] determination that [Taran] did not fully
accept responsibility for [Pharmacy Doctors’] misconduct was rational and
19
Case: 18-11168 Date Filed: 09/20/2019 Page: 20 of 21
supported by substantial evidence.”
Id. Thus substantial evidence supports the
Acting Administrator’s finding that Pharmacy Doctors failed to rebut the
government’s prima facie case that its registration would be “inconsistent with the
public interest.” 21 U.S.C. §§ 823(f), 824(a)(4).
C. The Acting Administrator’s Decision to Revoke Pharmacy Doctors’
Registration, Without Considering Its Remedial Steps, Was Neither
Arbitrary Nor Capricious.
The Acting Administrator declined to consider whether Pharmacy Doctors
took any remedial steps because Taran’s lack of understanding of her legal and
professional obligations made it “difficult (even illogical) to predict improvement.”
The Acting Administrator’s reasoning makes sense. “If a pharmacy shows that it
does not understand the extent of the past misconduct or its current responsibilities
under the law, the DEA rationally could doubt that the pharmacy would faithfully
comply in the future with its obligations under the CSA.” Jones
Total, 881 F.3d at
833. We therefore conclude that the Acting Administrator’s “refusal to consider
[Pharmacy Doctors’] remedial measures does not render its decision arbitrary or
capricious.”
Id. at 830.
Likewise, given the extent of its misconduct and Taran’s testimony as to her
lack of understanding of “the scope of a pharmacist’s obligations under the CSA,
. . . the Acting Administrator’s decision to revoke [Pharmacy Doctors’] registration
[and deny its application for renewal] as inconsistent with the public interest was
20
Case: 18-11168 Date Filed: 09/20/2019 Page: 21 of 21
not arbitrary, capricious, or an abuse of discretion.”
Id. at 833-34; see also
21 U.S.C. §§ 823(f), 824(a).
We reject Pharmacy Doctors’ argument that a sanction less extreme than
revocation of registration was warranted. “Under the APA, the agency’s choice of
sanction is entitled to substantial deference” and “is not to be overturned unless it
is unwarranted in law or without justification in fact,” though it may be set aside
“if it represents a flagrant departure from agency policy and practice.” Jones
Total, 881 F.3d at 834 (internal quotation marks omitted). Pharmacy Doctors cites
no “decision in which the DEA has continued a registration despite finding that the
registrant did not fully accept responsibility.”
Id. Because we have already
concluded that “substantial evidence supports the DEA’s finding that [Taran] did
not accept responsibility for the misconduct in this case, [Pharmacy Doctors] ha[s]
not shown that the agency’s choice of sanction represented a flagrant departure
from prior practice.”
Id. Thus the Acting Administrator’s choice of sanctions was
not arbitrary, capricious, or an abuse of discretion.
IV. CONCLUSION
For the foregoing reasons, we deny the petition for review.
PETITION DENIED.
21
