81 FR 47416 - James Dustin Chaney, D.O.; Decision and Order

DEPARTMENT OF JUSTICE
Drug Enforcement Administration

Federal Register Volume 81, Issue 140 (July 21, 2016)

[Federal Register Volume 81, Number 140 (Thursday, July 21, 2016)]
[Notices]
[Pages 47416-47418]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-17250]


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DEPARTMENT OF JUSTICE

Drug Enforcement Administration

[Docket No. 16-12]


James Dustin Chaney, D.O.; Decision and Order

    On November 13, 2015, the Deputy Assistant Administrator, Office of 
Diversion Control, issued an Order to Show Cause to James Dustin 
Chaney, D.O. (Respondent), of Hazard, Kentucky. The Show Cause Order 
proposed the revocation of Respondent's DEA Certificate of Registration 
BC8483430, pursuant to which he is authorized to dispense controlled 
substances in schedules II through V, and the denial of any pending 
applications to renew or modify his registration or for any other 
registration, on the ground that he does not have authority to handle 
controlled substances in Kentucky, the State in which he holds his DEA 
registration. Show Cause Order, at 1 (citing 21 U.S.C. 823(f); 
824(a)(3)).
    The Show Cause Order alleged that Respondent is registered as a 
practitioner with authority to dispense schedule II through V 
controlled substances at the registered location of 1908 North Main 
Street, Hazard, KY. Id. The Order further alleged that while 
Respondent's registration was due to expire on August 31, 2015, on 
August 25, 2015, he filed a timely renewal application and thus, his 
registration

[[Page 47417]]

remains in effect until the issuance of this Final Order. Id. (citing 5 
U.S.C. 558(c); 21 CFR 1301.13(b)).
    As for the factual basis for the proposed action, the Show Cause 
Order alleged that on August 22, 2014, the Kentucky Board of Medical 
Licensure had affirmed the Emergency Order of Suspension which was 
issued to Respondent on June 30, 2014. Id. While the Show Cause Order 
acknowledged that the suspension of Respondent's license to practice 
osteopathic medicine had been subsequently vacated, it further alleged 
that to the extent the Emergency Order had suspended Respondent's 
authority to dispense controlled substances, this prohibition remains 
in effect. Id. at 1-2. The Show Cause Order thus alleged that 
Respondent is currently without authority to dispense controlled 
substances in Kentucky, and therefore, his registration is subject to 
revocation. Id. at 2 (citing 21 U.S.C. 802(21), 823(f), and 824(a)(3)).
    On November 23, 2015, the Show Cause Order, which also notified 
Respondent of his right to request a hearing on the allegations, was 
served on Respondent by certified mail, return receipt requested. On 
December 16, 2015, Respondent, through his counsel, requested a 
hearing; the matter was placed on the docket of the Office of 
Administrative Law Judges and assigned to Chief Administrative Law 
Judge (CALJ) John J. Mulrooney, II. The next day, the CALJ ordered the 
Government to file evidence supporting the allegation and a motion for 
summary disposition by December 31, 2015; in the event the Government 
filed a motion, the CALJ directed Respondent to file its reply by 
January 15, 2016.
    On December 21, 2015, the Government filed its Motion for Summary 
Disposition. As support for its motion, the Government attached a copy 
of the Board's June 30, 2014 Emergency Order of Suspension and the 
Board's August 22, 2014 Findings Of Fact, Conclusions Of Law, And Final 
Order. Thereafter, Respondent filed a ``Response [t]o Government's 
Motion for Summary Judgment.''
    On January 19, 2016, the CALJ granted the Government's motion, 
finding that there was no dispute as to the material fact that 
Respondent is without authority to handle controlled substances in 
Kentucky, and that therefore, Respondent ``is not entitled to maintain 
his DEA registration.'' Order Granting Government's Motion for Summary 
Disposition and Recommended Ruling, Findings of Fact, Conclusions of 
Law, and Decision of the Administrative Law Judge, at 5-6. The CALJ 
further recommended that Respondent's registration be revoked and that 
any pending application to renew his registration be denied. Id. at 6.
    Neither party filed exceptions to the CALJ's decision. Thereafter, 
the record was forwarded to me for Final Agency Action. Having 
considered the record in its entirety, I have decided to adopt the 
ALJ's factual findings, legal conclusions and recommended sanction. I 
make the following findings.

Findings

    Respondent is the holder of DEA Certificate of Registration 
BC8483430, pursuant to which he is authorized to dispense controlled 
substances in schedules II through V as a practitioner at the 
registered address of Mountain After Hours Clinic, 1908 North Main 
Street, Hazard, KY 41701. Mot. for Summ. Disp., at Attachment 1. While 
this registration was due to expire on August 31, 2015, on August 25, 
2015, Respondent submitted a renewal application. Id. Thus, 
Respondent's registration remains active pending the issuance of this 
Decision and Order. 5 U.S.C. 558(c).
    Respondent is also the holder of a license to practice osteopathy 
issued by the Kentucky Board of Medical Licensure. Mot. for Summ. 
Disp., Attachment 3, at 1. However, ``[o]n or about June 5, 2014,'' 
Respondent ``was indicted on two (2) counts of knowingly and 
intentionally conspiring to distribute and unlawfully dispense Schedule 
II and III controlled substances,'' in violation of 21 U.S.C. 841(a)(1) 
and 846. Id. Respondent was also ``indicted on one (1) count of having 
knowingly open[ed], lease[d], rent[ed], use[d] and maintain[ed] a place 
(to wit [a pain management clinic]] . . . for the purpose of 
distributing and unlawfully dispensing controlled substances . . . in 
violation of 21 U.S.C. 856(a)(1).'' Id. at 2.
    Based on the above, the Board's Inquiry Panel found, inter alia, 
that probable cause existed to believe that Respondent had ``[e]ngaged 
in dishonorable, unethical, or unprofessional conduct of a character 
likely to deceive, defraud, or harm the public or any member thereof,'' 
and that he ``[v]iolated or attempted to violate,'' abetted, or 
conspired to violate ``any medical practice act, including . . . any 
other valid regulation of the board.'' Id. (citing Ky. Rev. Stat. Sec.  
311.595(9) & (12)). The Inquiry Panel further noted that under the 
Board's regulations, ``[i]f a licensee is indicted in any state for a 
crime classified as a felony in that state and the conduct charged 
relates to a controlled substance, that licensee's practice shall be 
considered an immediate danger to the public health, safety, or 
welfare,'' and that upon ``receiv[ing] verifiable information that a 
licensee has been indicted'' for such a felony, ``the inquiry panel . . 
. shall immediately issue an emergency order suspending or restricting 
that licensee's Kentucky license.'' Id. at 3 (quoting 201 Ky. Admin. 
Regs. 9:240, Sec.  3). The Inquiry Panel thus ordered that Respondent's 
license to practice osteopathy be suspended. Id. at 4.
    Thereafter, Respondent sought judicial review of the Emergency 
Order of Suspension in state court. Mot. for Summ. Disp., at Attachment 
4, at 9. He also requested an administrative hearing to challenge the 
Emergency Suspension. Id. at 1.
    On August 11, 2014, the state court issued a temporary injunction 
which enjoined the Board from enforcing the suspension. Id. at 9. The 
state court, however, ``kept in place the prohibition against 
[Respondent's] prescribing, dispensing, or otherwise utilizing a 
controlled substance . . . pending the issuance of'' the Board's Order. 
Id.
    On August 15, 2014, a Hearing Officer conducted a hearing at which 
Respondent was allowed to challenge the Emergency Suspension. Id. at 1. 
Following the hearing, the Hearing Officer found that ``there is 
probable cause to believe [Respondent] engaged in misconduct in 
violation of the Board's statutes and that his practice of medicine 
constitutes a danger to the health, welfare, and safety of his patients 
or the general practice.'' Id. at 2. However, consistent with the 
injunction, the Hearing Officer modified the suspension to allow 
Respondent to ``continue to practice osteopathy,'' while prohibiting 
him ``from prescribing, dispensing, or otherwise utilizing a controlled 
substance in Kentucky.'' Id.
    According to the online records of the Kentucky Board, the 
prohibition on Respondent's authority to dispense controlled substances 
remains in effect as of this date. I therefore find that Respondent is 
without authority to dispense controlled substances in Kentucky, the 
State in which he holds his DEA registration.

Discussion

    Pursuant to 21 U.S.C. 824(a)(3), ``[a] registration . . . to . . . 
dispense a controlled substance . . . may be suspended or revoked by 
the Attorney General upon a finding that the registrant . . . has had 
his State license or registration suspended, revoked, or denied by 
competent State authority

[[Page 47418]]

and is no longer authorized by State law to engage in the . . . 
dispensing of controlled substances.'' This Agency has further held 
that notwithstanding that this provision grants the Agency authority to 
suspend or revoke a registration, other provisions of the Controlled 
Substances Act ``make plain that a practitioner can neither obtain nor 
maintain a DEA registration unless the practitioner currently has 
authority under state law to handle controlled substances.'' James L. 
Hooper, 76 FR 71371, 71372 (2011), pet. for rev. denied, Hooper v. 
Holder, 481 F. App'x 826 (4th Cir. 2012).
    These provisions include section 102(21), which defines the term 
``practitioner'' to ``mean[] a physician . . . licensed, registered, or 
otherwise permitted, by . . . the jurisdiction in which he practices . 
. . to distribute, dispense, [or] administer . . . a controlled 
substance in the course of professional practice,'' 21 U.S.C. 802(21), 
as well as section 303(f), which directs that ``[t]he Attorney General 
shall register practitioners . . . to dispense . . . controlled 
substances . . . if the applicant is authorized to dispense . . . 
controlled substances under the laws of the State in which he 
practices.'' Id. Sec.  823(f). Based on these provisions, the Agency 
has long held that revocation is warranted even where a state board has 
summarily suspended a practitioner's controlled substances authority 
and the state's order remains subject to challenge in either 
administrative or judicial proceedings. See Gary Alfred Shearer, 78 FR 
19009 (2013); Carmencita E. Gallora, 60 FR 47967 (1995).
    Respondent nonetheless maintains that the proposed revocation of 
his registration would violate his right to due process because the 
Hearing Officer applied the wrong standard of proof when he upheld the 
Emergency Suspension Order. Response to Govt's Mot. for Summ. Judgment, 
at 4-8. According to Respondent, this is so because in holding that the 
Suspension Order was justified by Respondent's indictment, the Hearing 
Officer applied a probable cause standard rather than the substantial 
evidence standard as required by Kentucky law, and thus, the Hearing 
Officer's decision is arbitrary and capricious. Id. at 5. Respondent 
argues that he ``established with overwhelming and uncontested evidence 
that his practice of medicine is NOT a danger to the health, welfare, 
and safety of his patients or the general public.'' Id. And he further 
argues that ``the Hearing Officer improperly placed the risk of non-
persuasion on [him] and applied the [Board's] unconstitutional 
regulatory provisions allowing an indictment alone to serve as 
substantial evidence of a violation of law.'' Id. at 7.
    However, ```DEA has repeatedly held that a registrant cannot 
collaterally attack the results of a state criminal or administrative 
proceeding in a proceeding brought under section 304 [21 U.S.C. 824] of 
the CSA.''' Calvin Ramsey, 76 FR 20034, 20036 (2011) (quoting Hicham K. 
Riba, 73 FR 75773, 75774 (2008) (other citations omitted)); see also 
Shahid Musud Siddiqui, 61 FR 14818 (1996); Robert A. Leslie, 60 FR 
14004 (1995). DEA is not vested with authority to adjudicate either the 
constitutionality of the Board's Suspension Order, or whether the 
Board's Order is arbitrary and capricious. Respondent must therefore 
seek relief from the State Board's Order in those administrative and 
judicial forums provided by the State.
    In a revocation proceeding brought under section 824(a)(3), the 
only issue is whether a respondent holds current authority to dispense 
controlled substances. Respondent's various contentions as to the 
validity of the Board's order are therefore not material to this 
Agency's resolution of whether he is entitled to maintain his DEA 
registration. Because it is undisputed that Respondent does not hold 
authority under the laws of Kentucky to dispense controlled substances, 
he no longer meets the definition of a practitioner under the CSA and 
thus, he is not entitled to maintain his registration. See, e.g., 
Hooper, 76 FR at 71372. Accordingly, I will order that Respondent's 
registration be revoked and that any pending application to renew or 
modify this registration be denied.

Order

    Pursuant to the authority vested in me by 21 U.S.C. 824(a) and 
823(f), as well as 28 CFR 0.100(b), I order that DEA Certificate of 
Registration BC8483430 issued to James Dustin Chaney, D.O., be, and it 
hereby is, revoked. I further order that any application of James 
Dustin Chaney, D.O., to renew or modify this registration, be, and it 
hereby is, denied. This Order is effective August 22, 2016.

    Dated: July 11, 2016.
Chuck Rosenberg,
Acting Administrator.
[FR Doc. 2016-17250 Filed 7-20-16; 8:45 am]
 BILLING CODE 4410-09-P