82 FR 28676 - Peter F. Kelly, D.P.M.; Decision and Order
DEPARTMENT OF JUSTICE
Drug Enforcement Administration Federal Register Volume 82, Issue 120 (June 23, 2017)
Drug Enforcement Administration
Federal Register Volume 82, Issue 120 (June 23, 2017)
| Page Range | 28676-28692 | |
| FR Document | 2017-13158 |
[Federal Register Volume 82, Number 120 (Friday, June 23, 2017)] [Notices] [Pages 28676-28692] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-13158] ======================================================================= ----------------------------------------------------------------------- DEPARTMENT OF JUSTICE Drug Enforcement Administration [Docket No. 15-26] Peter F. Kelly, D.P.M.; Decision and Order On July 10, 2015, the Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration, issued an Order to Show Cause to Peter F. Kelly, D.P.M. (Respondent), of Roanoke, Virginia. ALJ Ex. 1, at 1. The Show Cause Order proposed the revocation of Respondent's Certificate of Registration No. BK0639279, the denial of any application to renew or modify his registration, and the denial of any other application for a DEA registration, on the ground that he has committed acts which render his registration ``inconsistent with the public interest.'' Id. (citing 21 U.S.C. 824(a)(4), 823(f)). As to the jurisdictional basis for the proceeding, the Show Cause Order alleged that Respondent is registered ``as a practitioner in [s]chedules II-V,'' under the above registration number, at the address of 4106 Electric Road, Roanoke, Virginia. Id. The Show Cause Order alleged that Respondent's registration does not expire until December 31, 2017. Id. As to the substantive grounds for the proceeding, the Show Cause Order alleged that in June 2000, Respondent was indicted in the Circuit Court for Roanoke County, Virginia, on four felony counts of unlawful possession of [[Page 28677]] controlled substances which included sufentanil, oxycodone, pethidine, and hydromorphone, as well as one misdemeanor count of marijuana possession. Id. The Order alleged that Respondent entered an Alford plea to the charges and was sentenced to probation and a fine. Id. The Order further alleged that as a result of the criminal case, on December 12, 2002, Respondent entered into a Memorandum of Agreement with DEA, and that on February 3, 2005, he entered into a Consent Order with the Virginia Board of Medicine for ``recordkeeping and other controlled substance violations,'' which resulted in his being fined and his license being ``placed on probation for twelve months.'' Id. at 1-2. Next, the Show Cause Order alleged that ``[f]rom approximately December 2007 until approximately September 2012, [Respondent's] employee, Vickie Mullen, used [his] DEA registration number to call-in and/or fax-in 72 prescriptions in her own name and 1[,]596 prescriptions in the names of others for controlled substances totaling 127,686 dosage units of hydrocodone (then a [s]chedule III controlled substance) and 5,370 dosage units of Ambien ([z]olpidem tartrate, a [s]chedule IV controlled substance).'' Id. at 2. The Order alleged that ``[t]hese prescriptions were not authorized by you and were not for a legitimate medical purpose, but rather were diverted by Ms. Mullen into illegitimate channels, including for her own personal use and the personal use of her son and numerous other individuals.'' Id. The Order then alleged that Respondent is ``responsible for the misuse of [his] registration by [his] employees.'' Id. (citations omitted). The Order further alleged that Respondent had ``continued to employ Ms. Mullen in [his] medical practice, even after learning of her diversion, in violation of 21 CFR 1301.92.'' Id. The Show Cause Order further alleged that ``[o]n July 10, 2013, DEA executed an Administrative Inspection Warrant . . . at [Respondent's] registered location'' and that the Agency found that Respondent was in violation of several record-keeping requirements. Id. More specifically, the Order alleged that Respondent ``failed to take'' both initial and biennial inventories of the controlled substances at his registered location. Id. (citing 21 U.S.C. 827(a) & (b); 21 CFR 1304.11(a) & (c)). The Order also alleged that Respondent violated DEA regulations requiring that the inventories list ``the number of commercial containers'' and the ``number of units or volume of each finished form in each container.'' Id. (citing 21 U.S.C. 827(a) & (b); 21 CFR 1304.11(e)(3) & (e)(1)(iii)(D)). The Order then alleged that these ``violations are the same as, or similar to, [the] recordkeeping violations previously found by the [S]tate as detailed in [the] February 3, 2005 Consent Order.'' Id. The Show Cause Order also alleged that Respondent left controlled substances, which included hydrocodone, alprazolam, and diazepam, ``out overnight in [his] office, rather than `stored in a securely locked, substantially constructed cabinet' as required by 21 CFR 1301.75(b).'' Id. at 2-3. The Order alleged that Respondent engaged in this practice so that his office manager, ``who is not a DEA registrant, could dispense these drugs to patients prior to [his] arrival in the office.'' Id. at 3. The Order then alleged that Respondent ``aided and abetted the unlawful distribution of controlled substances,'' because the office manager did not possess a DEA registration and dispensed controlled substances ``in [his] absence . . . in violation of 21 U.S.C. 822(a)(2) and 21 CFR 1301.11(a).'' Id. (citing 21 U.S.C. 841(a) and 18 U.S.C. 2). Following service of the Show Cause Order, Respondent, through his counsel, requested a hearing on the allegations. ALJ Ex. 2. The matter was placed on the docket of the Office of Administrative Law Judges and was initially assigned to Chief Administrative Law Judge John J. Mulrooney, II. However, on September 22, 2015, the matter was reassigned to Administrative Law Judge (ALJ) Charles Wm. Dorman, who conducted further pre-hearing procedures and an evidentiary hearing on January 12-13, 2016, in Roanoke, Virginia. On April 11, 2016, the ALJ issued his Recommended Decision. With respect to Factor One, the ALJ found that the Board's 2005 Consent Order ``is the only disciplinary action in the record'' and that the Board terminated his probation one month early. R.D. 29. The ALJ noted, however, that while possessing a state license is a necessary condition for holding a DEA registration, it is not dispositive. As for Factor Three, the ALJ found that while in 2000, Respondent was convicted of possession of marijuana and other controlled substances, these were simple possession offenses which did not involve the manufacture, distribution or dispensing of controlled substances and thus did not fall within Factor Three. Id. at 29-30. The ALJ thus concluded that ``there is no evidence to consider concerning Factor Three.'' Id. at 30. The ALJ then addressed the various allegations of misconduct under Factors Two, Four and Five. The ALJ rejected the allegation that Respondent is responsible for the misuse of his registration by Ms. Mullen, holding that the Government was required to show that Respondent had entrusted his registration to Mullen and had failed to produce any evidence that Respondent had given his registration number to Mullen or that he had given her access to his registration whether expressly, impliedly, or negligently. Id. at 32-34. The ALJ further found that there was no ``credible or substantial evidence showing that . . . Respondent knew about Mullen's illegal activities prior to August 20, 2012.'' Id. at 34. The ALJ specifically rejected the Government's contention that ```it is simply not believable that [Respondent] did not know of [Mullen's] diversion,'' finding that ``the evidence shows that no one, other than Mullen and her cohorts, was aware of Mullen's activities.'' Id. at 35. The ALJ also rejected the Government's contention that Respondent was put on notice that his registration was being misused when, in 2008, he was contacted by a pharmacist regarding two prescriptions that were called-in under his name, and that Respondent should have monitored Mullen and his PMP report. Id. at 35. The ALJ cited four reasons for rejecting the Government's argument, including: (1) That a ``fax did not contain any information that suggested that one of Respondent's employees was involved'' and that the ``prescription was not written for one of the Respondent's patients,'' (2) that the Respondent was never informed that Mullen was responsible for the prescriptions, (3) that even the detective who ran the investigation did not check the PMP, and 4) that ``the Government presented no evidence that . . . Respondent breached some duty by not monitoring his PMP.'' Id. The ALJ further rejected the Government's contention that Respondent violated 21 CFR 1301.92, by continuing to employ Mullen even after he learned of her diversion. R.D. 37-38. According to the ALJ, the regulation relied on by the Government ``does not require the immediate termination of an employee; it only requires that the employer immediately assess the employee's conduct to determine what employment actions to take against the employee.'' R.D. 37. The ALJ found that Respondent complied with the regulations because he told Mullen that she would be retained ``only until her replacement showed minimal proficiency,'' he ``began advertising [her] position the same week that he discovered her diversion,'' and [[Page 28678]] ``promptly hired and began to train Mullen's replacement.'' Id. The ALJ also noted that ``Respondent moved his fax machine to a room with a deadbolt on the door, called local pharmacies to alert them to Mullen's actions, took away Mullen's keys to the office, and monitored his DEA number on the PMP system.'' Id. The ALJ further noted that Mullen was ``Respondent's only insurance secretary,'' that ``her position was essential to the continued operation of . . . Respondent's practice,'' and while ``Respondent's office manager was competent to perform the duties of the insurance secretary, she could not do so and also perform her various duties.'' Id. at 38. According to the ALJ, ``[f]or small businesses that depend on each employee performing essential business functions, it is reasonable to expect that terminating an employee can be a process rather than an instantaneous action.'' Id. The ALJ thus concluded that Respondent acted ``[c]onsistent with the requirements of 21 CFR 1301.92'' by taking ``immediate action towards terminating Mullen's employment because of her misconduct'' and rejected the allegation. Id. With respect to the recordkeeping allegations, the ALJ rejected Respondent's contention that he was not subject to the recordkeeping requirements of 21 U.S.C. 827(a), because he did not ``regularly engage[] in the dispensing or administering of controlled substances and charge[d] his patients, either separately or together with charges for other professional services, for substances so dispense or administered.'' Id. at 39 (quoting 21 U.S.C. 827(c)(1)(B)). Based on the findings of the 2005 Virginia Board of Medicine Consent Order, the ALJ then found that the Government had proved that Respondent failed to conduct an initial inventory. Id. at 40 (citing 21 U.S.C. 827(a)(1)). He also found that the Government had proved that Respondent failed to conduct and ``maintain[ ] a proper biennial inventory'' because his records did not contain an actual count of the controlled substances taken either at the beginning or close of business but rather ``a running balance of controlled substances after dispensing.'' Id. at 41 (citing 21 CFR 1304.11(c)). The ALJ further found that the inventories were not compliant because they did not contain ``the number of commercial containers of each controlled substance'' and the ``the number of units or volume of each commercial container of controlled substances.'' Id. at 42 (citations omitted). Next, the ALJ rejected the Government's contention that Respondent violated 21 CFR 1301.75, which requires that controlled substances be stored ``in a securely locked, substantially constructed cabinet,'' when he left the controlled substances out overnight for his office manager to administer to patients who were undergoing procedures the following morning. Id. at 44. The ALJ specifically noted that the DEA regulation does not define the term ``cabinet,'' but that the New College edition of the American Heritage Dictionary of the English Language (1976) includes as one of the word's definitions, ``a small or private room set aside for some specific activity.'' Id. The ALJ noted that the room in which the medications were kept was locked, that only the Respondent and his office manager had a key, that the room had a steel reinforced door and steel doorframe with a deadbolt, that Respondent's office was protected by a security system, and that there was no evidence that the room ``was used for any purpose other than to store controlled substances prior to 2014.'' Id. The ALJ thus concluded that the Government failed to prove the violation. Id. However, the ALJ found that the Government proved the allegation that Respondent had aided and abetted the unlawful distribution of controlled substances by having his office manager, who was not registered, administer controlled substances to patients who were to have procedures on days when he was late arriving at his office. Id. at 44-45. The ALJ specifically rejected Respondent's argument that his office manager was exempt from registration under 21 CFR 1301.22(a), because she was an ``agent or employee . . . acting in the usual course of . . . her . . . employment.'' Id. at 45. Based on Respondent's testimony that the office manager administered controlled substances to patients ``only on `limited occasions,' '' the ALJ explained that he was ``find[ing] as a matter of fact that [her] administration of controlled substances was described repeatedly as `occasional,' which is the opposite of `usual[,]' '' and ``[t]herefore, [section] 1301.22(a) does not apply.'' Id. As to this violation, the ALJ also found that Respondent did not acknowledge his misconduct. Id. at 46. Finally, the ALJ found that Respondent's 2000 state court convictions for unlawful possession of various controlled substances could be considered under Factor Five. The ALJ noted, however, that ``these convictions occurred over 15 years ago, and [that] Respondent has not been convicted of any controlled substance offenses since 2000.'' Id. at 47. The ALJ further rejected Respondent's contention that DEA was estopped from relying on the convictions because it subsequently entered into an MOA with Respondent. Id. The ALJ also rejected Respondent's contention that his possession of the drugs did not actually violate federal law because his home was a warehouse which was exempt from registration under the Controlled Substances Act (CSA), reasoning that issue could not be re-litigated in this proceeding. Id. Based on his findings of the recordkeeping violations, the aiding and abetting of the office manager's unlawful distribution of controlled substances, and the 2000 convictions, the ALJ concluded that the Government had established ``a prima facie case that . . . Respondent has acted in a manner that is inconsistent with the public interest and that marginally supports the sanction [revocation] that the Government requests.'' Id. at 48. Turning to whether Respondent had rebutted the Government's prima facie case, the ALJ found that while ``Respondent acknowledged his three violations, [he] did not show remorse for his actions'' and that he had not accepted responsibility. Id. While the ALJ found that Respondent had not ``rebut[ted] the Government's prima facie showing that a sanction is appropriate,'' he also concluded that the egregiousness of Respondent's misconduct was mitigated by various circumstances. Id. at 50; see also id. at 52. However, even taking ``these matters into considerations,'' the ALJ still found that ``Respondent's violations, in combination, are serious and raise concerns of whether his registration is consistent with the public interest.'' Id. at 53. Continuing, the ALJ explained that ``[i]n light of . . . Respondent's failure to accept responsibility, the record supports the conclusion that [his] registration should be suspended and [he] should obtain training concerning recordkeeping, as well as storage and administration of controlled substances.'' Id. The ALJ thus recommended that Respondent's registration be suspended for a period of one year, to begin three months from the effective date of the Decision and Order in this matter, and that the suspension be stayed if during this period, Respondent completed courses in ``controlled substance recordkeeping,'' ``control substance storage,'' and ``the administration of controlled substances.'' Id. The ALJ also recommended that if his proposed suspension was stayed, that his [[Page 28679]] registration be restricted to authorize only the prescribing of controlled substances for a period of one year to begin on the stay's effective date. Id. And he further recommended that if the suspension is stayed, Respondent ``undergo an annual audit to ensure compliance with controlled substance regulations . . . by an independent auditor hired by . . . Respondent, for three years from the effective date of the stay[,]'' with ``[t]he first audit [to] be conducted no later than one year after the effective date of the stay,'' with the results to be forwarded to the local DEA office ``within [10] business days after the audit.'' Id. at 53-4. Respondent filed Exceptions to the Recommended Decision. Thereafter, the record was forwarded to my Office for Final Agency Action. Having considered the record in its entirety, including Respondent's Exceptions, I agree with the ALJ that the Government has failed to prove that Respondent is liable either for entrusting his registration to Ms. Mullen (his insurance clerk) or because he knew or should have known of her criminal misconduct prior to August 20, 2012. I also agree with the ALJ that the Government has failed to prove that Respondent violated 21 CFR 1301.75, on those occasions when he left controlled substances outside of the controlled substances safe but the drugs were left locked in the drug room. I further agree with the ALJ that Respondent failed to conduct an initial inventory and that he also failed to take a proper biennial inventory because he did not actually count the drugs that were on hand. In addition, I agree with the ALJ that Respondent aided and abetted a violation of 21 U.S.C. 841 when he directed his office manager to administer controlled substances to patients prior to procedures when he was not present in the office. Finally, I agree with the ALJ that Respondent was convicted in 2000 in state court of four felony offenses and one misdemeanor offense of unlawful possession of controlled substances. I disagree, however, with the ALJ's rejection of the Government's contention that Respondent should have immediately terminated Mullen after he determined that she had been calling and faxing in fraudulent prescriptions and refill requests for hydrocodone and zolpidem. While I agree with the ALJ that Respondent did not acknowledge any of his misconduct, I disagree with his recommended sanction of a stayed suspension. Instead, I conclude that relevant factors support the imposition of an outright suspension of Respondent's registration for a period of one year, as well as the requirement that Respondent take a course in controlled substance recordkeeping if, following termination of the suspension, he intends to resume either administering or engaging in the direct dispensing of controlled substances. I make the following factual findings. Findings of Fact Respondent's License and Registration Status Respondent is a board certified Doctor of Podiatric Medicine who is licensed by the Virginia Board of Medicine. GX 2. At all times relevant to the events at issue, Respondent maintained offices in Roanoke, Bedford, Radford, and Rocky Mount, Virginia. RX 13, at 2. Respondent is also the holder of DEA Certificate of Registration BK0639279, pursuant to which he is authorized to dispense controlled substances in schedules II through V, as a practitioner, at the registered address of 4106 Electric Road, P.O. Box 20566, Roanoke, VA 24018. ALJ Ex. 8, at 15. Respondent's registration does not expire until December 31, 2017. Id. The Prior Criminal and Administrative Proceedings On September 13, 2000, Respondent pled guilty in the Circuit Court of Roanoke County Virginia to four felony counts of possession of the controlled substances sufentanil, oxycodone (with acetaminophen), pethidine (meperidine), and hydromorphone,\1\ as well as a single misdemeanor count of possession of marijuana. GX 1, at 1. The Circuit Court, while finding the evidence sufficient to convict Respondent, withheld adjudication pursuant to the written plea agreement. Id. at 2. Thereafter, on October 30, 2000, the Circuit Court sentenced him to probation for a period of one year, the terms of which required him to perform 100 hours of community service, to forfeit his driver's license for 30 months, to undergo drug abuse testing and counseling, and to pay costs. Id. at 4; see also RX 83, at 1. Respondent successfully completed probation and on October 31, 2001, the charges were dismissed. GX 1, at 6; RX 83, at 1. --------------------------------------------------------------------------- \1\ Each of the felony counts involved a schedule II controlled substance. See 21 CFR 1308.12(b)(1)(vii) (hydromorphone); id. Sec. 1308.12(b)(1)(xiii) (oxycodone); id. Sec. 1308.12(c)(18)(pethidine); id. Sec. 1308.12(c)(27) (sufentanil). Respondent maintained that the drugs (other than the marijuana) were both ``expired and existing medications'' which he moved from his office to his house because, based on his drug counts, some of the drugs were missing and while he suspected one of his employees, he ``didn't really have any evidence to confront her and report this.'' Tr. 383-84. However, Respondent asserted that the pethidine ``was left over from [his] ex-wife's . . . rhinoplasty procedure, and she doesn't really take any narcotics, so she had some of these left over.'' Id. at 387. Respondent asserted that he entered the Alford plea because had he gone to trial, ``it would have made the front page [of the] paper for the whole week'' and ``would have cost me all my patients and reputation.'' Id. at 388. Respondent subsequently maintained that during the hearing on his plea, the Commonwealth's Attorney ``was unable to point to any specific violation of law.'' Id. at 389-90. However, the Circuit Court's orders identified the specific provisions of the Virginia Code violated by Respondent. See GX 1, at 1 (Trial Order citing Va. Code Sec. Sec. 18.2-250 and 18.2- 250.1); id. at 3 (Sentencing Order citing same provisions). --------------------------------------------------------------------------- Shortly after Respondent was sentenced, representatives of the DEA notified him that his registration was subject to revocation based on the above proceeding; the letter also offered Respondent the opportunity to voluntarily surrender his registration. RX 83, at 1. Sometime thereafter, Respondent's attorney wrote a letter to the DEA representatives informing them that he had successfully completed his probation and that all of his drug tests were negative and that his propensity for drug abuse risk was found to be negligible. Id. On December 12, 2002, DEA agreed to renew his registration subject to a Memorandum of Agreement (MOA) which remained in effect for a period of one year. Id. at 2. On October 15, 2004, the Virginia Board of Medicine notified Respondent that it would hold ``an informal conference'' to inquire into various allegations that he ``violated certain laws and regulations governing the practice of podiatry in Virginia.'' GX 2, at 1. The Board raised 19 different allegations including, inter alia, that he violated Virginia law by: (1) Unlawfully possessing controlled substances based on his Alford plea; (2) that prior to February 15, 2001, he ``failed to perform an initial inventory, establish a biennial inventory date, and failed to take an inventory of all [s]chedule II to V controlled substances at least every two (2) years''; and (3) that the inventory he ``performed on February 15, 2001 lacked the time it was performed and the name of the individual who performed it.'' \2\ Id. at 1-3. --------------------------------------------------------------------------- \2\ Some of the other allegations included that he administered expired controlled substances to his patients, and that he dispensed schedule III and IV controlled substances to patients for their ``at home use'' ``without a license from the Board of Pharmacy.'' GX 2, at 1-2. --------------------------------------------------------------------------- On February 3, 2005, Respondent and the Board entered into a Consent Order, which found that Respondent had violated various provisions of Virginia law. The findings included ``that he . . . did not establish an initial inventory or maintain current and accurate records of his inventory, receipt and distribution of controlled substances,'' and that he [[Page 28680]] ``did not provide for adequate storage for controlled substances maintained in his office.'' GX 3, at 1-2. The Consent Order further found that ``since the Board brought these matters to his attention in July 2002, [Respondent] has revised and updated his controlled substance recordkeeping, storage and dispensing practice, and believes that he is fully compliant with all regulatory requirements regarding controlled substances.'' Id. at 4. Based on its findings, the Board imposed a monetary penalty of $2,000 and placed Respondent on probation for a period of one year. Id. at 5. The Board further required that Respondent certify ``that he has read and agrees to fully comply with Chapters 33 and 34 of the Code of Virginia,'' that he ``successfully complete [a] continuing education course[] in recordkeeping,'' and that ``[w]ithin 60 days from the entry of [the] Order,'' he ``submit to an inspection and audit by an Investigator of the Department of Health Professions (DHP) to ensure that he is in compliance with record keeping, storage and dispensing requirements.'' Id. at 5-6. The Order also provided that ``[w]ithin 9 months from the inspection and audit . . . Respondent's practice may be subject to an unannounced inspection by a'' DHP Investigator. Id. On January 11, 2006, a Committee of the Board met to review Respondent's compliance with the Consent Order and found that he ``had fully complied with all terms [of] the Order.'' GX 4, at 1. The Board thus terminated Respondent's probation and restored his license to un- restricted status. Id. The Diversion Occurring at Respondent's Practice Sometime in 2004, Respondent hired Ms. Vicki Mullen to work at his Roanoke office, where her duties included preparing and filing insurance claim forms. Tr. 73, 81. According to Respondent's office manager, Mullen was authorized to use Respondent's signature stamp on the forms. Id. at 81. She also had access to the fax machine.\3\ Id. at 408. --------------------------------------------------------------------------- \3\ According to the testimony of Respondent's office manager, Respondent saw patients once a week at his Roanoke office; he also did surgeries once a week at the Roanoke office, however, he did not do surgeries every week. Tr. 56. --------------------------------------------------------------------------- Beginning on or about December 31, 2007, Mullen began calling in prescriptions to pharmacies for various drugs including 90 to 120 dosage units of hydrocodone 10 mg (then a schedule III and now a schedule II controlled substance) and 30 dosage units of zolpidem (the generic version of Ambien, a schedule IV controlled substance). GX 12, at 1. According to the credited testimony, at one Walmart pharmacy, Mullen would call the pharmacy's doctor's line and leave a message for a prescription representing that she was calling on behalf of Respondent. The Walmart pharmacy would fill the prescriptions even though Mullen did not provide Respondent's DEA registration number.\4\ Tr. 42. Instead, notwithstanding that DEA regulations require that an oral prescription contain all of the information mandated under 21 CFR 1306.05, including the prescriber's DEA registration number,\5\ the pharmacist would retrieve Respondent's registration number from the computer and put it on the call-in prescription form which the pharmacy would complete.\6\ Id. at 48. Mullen did not give her name as the person calling in the prescriptions; rather, she used such names as Virginia Norvel, Liz Norville, and Liz Chilton. See GX 6, at 2; GX 7, at 5, 7, 12, 14; Tr. 106. --------------------------------------------------------------------------- \4\ According to the credited testimony of both Respondent and his office manager, his DEA registration was not posted and was kept in a file with his license in his office. Tr. 71, 319, 405. Also, his signature stamp did not contain his registration number. Id. at 80 & 405. Nor did Respondent's prescription blanks contain his DEA number. Id. at 71; see also RX 16. Respondent did not, however, keep his office door locked. Tr. 274. \5\ The only exception is the prescriber's signature. 21 CFR 1306.21(a). \6\ On cross-examination, a Diversion Investigator provided testimony suggesting that pharmacies ``normally'' fill oral prescriptions or called-in prescriptions that are missing ``the doctor's DEA number because it is already on file.'' Tr. 148. Moreover, the record contains numerous prescriptions that were reduced to writing by the pharmacist, but which were missing Respondent's DEA number. See GX 7. While in some instances, the DEA number was written on the prescription, the Government put forward no evidence that the pharmacist had obtained Respondent's DEA number off the voice mail message left by Mullen rather than through the pharmacy's database. --------------------------------------------------------------------------- On some occasions, the pharmacies would fax a refill request to Respondent's office. On these occasions, Mullen would use Respondent's signature stamp to manifest that he had approved the refill request and fax the authorization back to the pharmacy which typically authorized three refills. See GX 7, at 9; GX 8, at 5, 7, 13, 15, 17, 19; GX 9, at 7, 13, 23, 29, 34, 38; GX 10, at 9, 15, 19. However, notwithstanding Respondent's claim that Mullen did not have access to his DEA number,\7\ the record contains numerous refill request forms that suggest otherwise. These forms include a ``Prescriber Comments'' box with lines for printing the ``Prescriber's Name,'' the ``Prescriber's DEA #,'' as well as lines for the ``Prescriber's Signature''--which was where Mullen would use Respondent's signature stamp--and the ``Date.'' See GX 8, at 5. Notably, a number of these forms included Respondent's DEA number which was hand-written in the ``Prescriber Comments'' box. See GX 8, at 5, 7, 13, 15, 17, 19; GX 9, at 7, 13, 23, 29, 34, 38; GX 10, at 9, 15, 19. --------------------------------------------------------------------------- \7\ See Tr. 174-75 (Colloquy between Respondent's counsel and DI regarding refill request form (GX 7, at 9): ``Q[.] And as faxed back from, allegedly from the doctor's office, it does not have a DEA number on it, does it?'' A[.] No.''). --------------------------------------------------------------------------- Over the course of the scheme, Mullen called in or faxed in prescriptions and refill requests for 82 prescriptions for herself which Respondent had not authorized.\8\ Tr. 106-07. On some occasions, she called in prescriptions listing her son and a daughter-in-law as the patients. Id. at 105. Moreover, Mullen's son provided her with the names and dates of birth of his co-workers, who agreed to pick up the prescriptions. Id. at 105-06. Mullen also called in and or stamped refill requests for 13 prescriptions for 90 dosage units of hydrocodone 10 mg, with Respondent's office manager listed as the patient. RX 36. In her testimony, Respondent's office manager denied that she had received any of these prescriptions. Tr. 84. --------------------------------------------------------------------------- \8\ While the testimony was to the effect that Mullen called in or faxed in 72 prescriptions for herself, the PMP report lists 82 prescriptions/refills. RX 24. --------------------------------------------------------------------------- Between December 31, 2007 and August 20, 2012, Mullen called in, or stamped and faxed, prescriptions and refill requests for 1,596 prescriptions and refills for hydrocodone and zolpidem. GX 12. In total, the prescriptions resulted in the dispensing of 127,686 dosage units of hydrocodone and 5,370 dosage units of zolpidem under Respondent's registration.\9\ GX 11, at 2. --------------------------------------------------------------------------- \9\ According to Detective Findley of the Virginia State Police Drug Diversion Unit, Mullen stated that only ``one pharmacy called [the] office to verify the prescriptions,'' and because Mullen ``was there by herself and . . . took the phone call [she] obviously told the pharmacist that it was fine, to go ahead and fill'' the prescription. Tr. 225. Detective Finley further testified that zolpidem is a sleep medication which is not usually prescribed by podiatrists and that the issuance of two to three monthly prescriptions by a podiatrist should have been suspicious to a pharmacist and that it would be unusual for a podiatrist to continue prescribing this drug. Id. at 226-27. With respect to the hydrocodone prescriptions, Detective Finley agreed with Respondent's counsel that ``it would be unusual for a podiatrist to maintain somebody on narcotic pain medication at the levels'' of these prescriptions. Id. at 227. --------------------------------------------------------------------------- While Mullen was able to continue her illegal activity for nearly five years, she came to the attention of the Virginia State Police as early as November 18, 2008. GX 6, at 2. According to the evidence, on November 17, 2008, [[Page 28681]] Mullen called in two prescriptions for Tramadol, which although it was not then a federally-controlled substance, it was a controlled substance under Virginia law, to a Walmart Pharmacy in Christiansburg, Virginia. Id. Upon reviewing the prescriptions, the pharmacist noted that they were issued by the same doctor (Respondent), for the same exact prescription to two patients (C.T. and S.F.), who, while they had different last names, had the same address. Id. According to the pharmacist, the prescriptions were purportedly called in by Liz Norville. Id. Finding the two prescriptions to be suspicious, the pharmacist called Respondent's office and was told that ``no one named Liz Norville . . . worked at that office [and] that they had no patients by the name of'' C.T. and S.F. Id. Later that day, Respondent called the pharmacist and confirmed that C.T. and S.F. were not his patients and that ``no one had called those in from his office.'' Id. Respondent also faxed to the pharmacist a written statement, stating that ``[n]either did my office nor I call in prescriptions for [C.T. or S.F.] at any time. They are not my patients.'' GX 5, at 1. The next day, the pharmacist reported the prescriptions to Detective Larry Findley, who was assigned to the Drug Diversion Unit of the Virginia State Police.\10\ Tr. 189; RX 93-A. --------------------------------------------------------------------------- \10\ On cross-examination, Respondent asserted that he ``didn't think [the November 2008 incident] had anything to do with me. There was nothing to link my employee with that at all.'' Tr. 404. He then testified that he thought the incident was ``associated more with'' a podiatrist who practiced in the Christiansburg, Virginia area and who had bought another practice in an area where there was ``a large drug ring down there.'' Id. at 404-05. Respondent explained that ``I addressed the issue as it was presented to me'' and ``I had [the office manager] search our computer database and our current patient files.'' Id. at 407. He further testified that because the purported patients were not his patients he made no changes to his office practices and had ``[n]o reason to'' discuss the incident with Mullen. Id. at 408. After Respondent acknowledged that Mullen had access to the fax machine and his signature stamp, the Government asked him what measures he had in place to supervise employees when he was in his other offices. Id. at 408-09. Respondent asserted that ``aside from recording all calls, and having copies faxed to my email, I can't think of any measure that wouldn't be extreme, and quite burdensome.'' Id. He then acknowledged that he took no such measures. Id. at 410. --------------------------------------------------------------------------- The same day, Detective Findley went to the pharmacy, interviewed the pharmacist and obtained a written statement from her, as well as the statement Respondent had provided to the pharmacist. GX 6, at 2; Tr. 189-90. Using video footage, the Detective, with the assistance of one of the store's asset protection officers, was able to identify the individual who picked up one of the prescriptions as M.F.,\11\ who has the same last name as S.F. RX 93-A. The Detective called M.F., who ``admitted to picking up the forged prescriptions.'' Id. She also told the Detective that Vicki Mullen had called in the prescriptions. Id., see also Tr. 191. --------------------------------------------------------------------------- \11\ The asset protection officer had worked at the same Walmart in Salem, Virginia as had M.F. RX 93-A. --------------------------------------------------------------------------- Thereafter, on November 20, 2008, the Detective interviewed Mullen, who admitted that she had called in the forged prescriptions. RX 93-A. While on February 6, 2009, Mullen was indicted in state court on the charge that she ``did obtain or attempt to obtain [Tramadol], by fraud, deceit, misrepresentation, embezzlement, or subterfuge, or by the concealment of a material fact,'' which was punishable as a Class 6 felony under Virginia law, at no point did the Detective tell Respondent that Mullen had been arrested.\12\ Tr. 214. --------------------------------------------------------------------------- \12\ Mullen was not arrested until February 20, 2009, after she was indicted. Tr. 217. --------------------------------------------------------------------------- The Detective further admitted that he did not obtain a Prescription Monitoring Program (PMP) report using Respondent's DEA registration number to determine what controlled substance prescriptions were being dispensed under his registration. Id. at 210. He also did not obtain a PMP report showing the prescriptions obtained by Ms. Mullen. Id. at 212. While the Detective testified that he did not remember the exact date on which the state police's drug diversion agents were given access to the PMP, he acknowledged that during the period in which he was investigating the tramadol prescriptions, he probably had the ability to obtain a PMP report of Respondent's controlled substance prescriptions. Id. at 211-12. While the Detective's testimony also suggests that he obtained a report from the Walmart Pharmacy of the prescriptions dispensed to the individuals who were filling the forged prescriptions, he did not ask the pharmacy to provide a report of Ms. Mullen's prescriptions. Id. at 212-13. Moreover, the Detective did not notify any other pharmacies to be on the lookout for potentially forged prescriptions from Respondent's office. Id. at 214. Notably, by November 17, 2008, Mullen's criminal conduct had already resulted in the dispensing of 200 prescriptions and refills, each being for 90 dosage units of hydrocodone, by three Walmart Pharmacies. See GX 12, at 1-7. And by this date, Mullen herself was able to fill a prescription or a refill for 90 dosage units of hydrocodone 10 mg on nine different occasions. See GX 13, at 1. Indeed, Mullen's criminal conduct continued unabated even after she was indicted, and even after May 27, 2009, when she pled guilty to two counts of prescription fraud and was offered probation for one year and a deferred adjudication of the charges. See GX 14, at 3-4, 7-9; GX 12, at 9-49. At no point was Respondent notified that Mullen had pled guilty to the charges, and he was not otherwise notified of Mullen's conviction by ``the parole [sic] system.'' Tr. 428; see also id. at 357.\13\ --------------------------------------------------------------------------- \13\ During cross-examination by Respondent, the Detective was asked whether he recalled that during Mullen's plea hearing in federal court, the Court asked him if he was ``convinced that [Respondent] had no idea this was going on until it was brought to [Respondent's] attention by his ex-wife, if I understand that,'' and that he [the Detective] had answered, ``Yes, sir.'' Tr. 228. While the Detective acknowledged his previous testimony, id., the transcript of Mullen's federal court plea hearing was not made part of the record, and nothing in the record of this proceeding establishes that Respondent's ex-wife brought ``this'' to Respondent's attention, let alone when she may have done so. --------------------------------------------------------------------------- Mullen continued to work for Respondent until late September 2012, nearly five weeks after August 20, 2012, when his office manager found a faxed refill request from a Walmart Pharmacy (#1301) for 90 dosage units of Lortab 10 mg for a patient named J.L. GX 15, at 2; see also RX 18; Tr. 342-43. According to the office manager, she pulled a chart for a patient with the same name and determined that there was no such original prescription in the chart; she also determined that while the actual and purported patient had the same names and address, they had different birthdates. Tr. 60. The office manager showed the refill request to Respondent, who determined that he did not write the prescription. Id.; see also id. at 342. Respondent then called the pharmacy. GX 15, at 2; Tr. 343. The pharmacist reviewed J.L.'s prescription history and told Respondent that J.L. had been obtaining Lortab prescriptions/refills on a monthly basis since May 17, 2011, ``when the original prescription was called in by'' a person who gave Vicki as her first name but a different last name than Mullen. GX 15, at 2; Tr. 348; see also RX 27 (telephone prescription of May 17, 2011 with no DEA number); RX 28, at 1-4 (request for refills dated 6/30/11 (four total refills), 11/22/11 (one refill), 12/20/11 (four total refills), 4/10/12 (four total refills). The pharmacist verified that the refill requests were faxed to and from Respondent's office. GX 15, at 2; see also RX 28, at 1-4. Respondent told the pharmacist ``that somebody was fraudulently using [his] DEA number.'' Tr. 350. He also told the [[Page 28682]] pharmacist ``to block [his] DEA number.'' Id. Respondent acknowledged, however, that a couple of prescriptions were filled after this conversation. Id. A spreadsheet compiled by the Government shows that on August 29 and September 2, 2012, two refills, each being for 120 dosage units of hydrocodone, were filled by this same pharmacy. GX 12, at 49. The spreadsheet also shows that 10 other refills for 90 or 120 dosage units of hydrocodone were dispensed between August 22 and September 15, 2012.\14\ Id. However, the prescription numbers support a finding that Mullen had either called in or faxed back the fraudulent authorization for each of these refills prior to August 20, 2012. Tr. 166; GX 12, at 47-49. --------------------------------------------------------------------------- \14\ Four of the refills were dispensed by a different Walmart Pharmacy (#3243), three were dispensed at still another Walmart Pharmacy (#2312), one was filled at two different CVS pharmacies (#s 06285 and 03949), and another prescription was dispensed at a Walgreens Pharmacy (#7604). GX 12, at 49. Respondent testified that he had called various pharmacies to report these incidents, but did not ``exactly know when [he] did that,'' before claiming that he might have done this on August 20, 2012, before he left for his Radford office. Tr. 359. Respondent then explained that he notified one of the Walmarts that his ``DEA number [wa]s being . . . falsified and abused'' and that ``should go to all of the Walmarts'' because ``they're going to be on a network.'' Id. at 360. He also stated that he had called ``a handful of these'' pharmacies, including CVS and Walgreens, and that he knew it worked because he subsequently received phone calls from pharmacists questioning prescriptions. Id. As for why the two prescriptions were filled at Walmart #1301 even after he had informed this pharmacy that the refill authorization for J.L. was fraudulent, Respondent testified that he ``figured the same thing would happen with this Walmart 1301 also. So, I had no reason not to believe it would work.'' Id. --------------------------------------------------------------------------- Respondent further determined that only Mullen was working in his Roanoke office that afternoon as he and his office manager had worked at his Radford office. GX 15, at 2. Respondent confronted Mullen over the phone who ``confessed to falsifying [his] signature, submitting the refill authorizations, and picking them up.'' Id.; Tr. 354. Respondent asked Mullen ``how many other people she used for the[] false prescriptions''; Mullen answered ``about five.'' GX 15, at 2; Tr. 355.\15\ --------------------------------------------------------------------------- \15\ According to Respondent, sometime between August 20 and 24, 2012, Mullen gave Respondent three refill authorization forms which had been faxed to his office from Walmart Pharmacies #s 2312 and 3243. See RX 26. One of the requests, which was dated March 13, 2012, was for Mullen herself and authorized the dispensing of four refills of 30 Ambien 10 mg. Id. at 1. The other requests, which were dated November 22, 2010 and August 14, 2012, authorized the dispensing of four refills of 90 Lortab 10 mg to R.H. and four refills of 120 Lortab 10 mg to J.B. Id. at 2-3. --------------------------------------------------------------------------- Respondent called DEA and spoke with a Diversion Investigator, who told him to call Detective Findley. Tr. 347. Respondent called Detective Findley; the two met at Respondent's Radford office that afternoon. Id. at 347, 355. According to Respondent, Findley told him that ``Vicki Mullen's history extended beyond the falsified prescriptions mentioned above, to include other stores, and other CIII medications.'' GX 15, at 2. Findley told Respondent that Mullen had committed similar acts in 2008. Id. Several days later, Respondent accessed the Virginia Court System's Web site and found the records of the 2009 criminal case in which Mullen pled guilty to obtaining drugs by fraud. RX 23, at 1-6. He also ran a PMP report on Mullen. RX 24. The Report showed that from January 21, 2008 through August 24, 2012, Mullen had obtained 56 prescriptions/ refills for 90 dosage units of hydrocodone 10 mg and 26 prescriptions/ refills for 30 dosage units of zolpidem 10 mg which were dispensed under Respondent's registration. Id. On August 24, 2012, Respondent had Mullen prepare a written statement regarding her misconduct. See GX 16. In the statement, Mullen listed the stores she had used, including three Walmarts and three CVSs. Id. at 1. She also stated that Respondent and his office manager ``had no part or knowledge of my activities.'' Id. While Respondent told Mullen that she would be fired, and placed an ad for her replacement, he retained her as an employee through September 28, 2012. See RX 49; Tr. 360. He testified that if he had another employee who could have done his insurance billing, Mullen ``would have been out the door immediately.'' Tr. 362. He maintained that he ``could not operate'' his practice without his insurance clerk, that 99 percent of his cash flow came from insurance reimbursements, and that if he had fired Mullen immediately, ``we would have had a backlog, and things would have started trailing off in three weeks.'' Id. at 361. He also asserted that he had tried both ``electronic billing'' and ``any number of substitutes,'' but these measures had not ``worked.'' Id. at 362. And he maintained that to prevent a re- occurrence of Mullen's criminal activity, he had moved the fax machine into the medication room, which had a steel door and frame with a deadbolt lock for which Mullen did not have a key, and took away her office keys. Id. at 359, 421. Respondent further asserted that ``I needed to isolate [Mullen] from any of these communications, to keep the office safe from her.'' Id. at 362. Yet Respondent offered no testimony that Mullen was denied access to the office phone. And when asked by his counsel if Mullen would abide by ``[t]he limitations [he] placed on her with what she was doing,'' Respondent answered: ``She didn't indicate anything. She didn't have much choice in the matter.'' Id. at 363. Respondent also asserted that at the time he decided to retain Mullen while she trained her replacement he acted in ``proportion of things that I knew. So it wasn't . . . what we're looking at in retrospective now with this huge situation. It was only with a handful of information that I had, less than a dozen.'' Id. at 426. Yet, as found above, on August 24, 2012, Respondent ran a PMP report on Mullen's prescriptions. The report showed that between January 21, 2008 and August 24, 2012, Mullen herself had obtained 56 prescriptions for 90 hydrocodone 10 mg and 26 prescriptions for 30 tablets of zolpidem 10 mg. RX 24. So too, Respondent testified that Mullen had given him copies of two refill request forms, which she had stamped with his signature and faxed back, which authorized the dispensing of four refills of hydrocodone to J.B. (120 du) and R.H. (90 du). RX 26; see also GX 12, at 26, 48. Consistent with Mullen's August 24, 2012 statement, both Respondent and his office manager denied having any knowledge of Mullen's criminal activity, including the 2009 state proceeding, until late August 2012. Tr.75-76, 88 (office manager's testimony); id. at 355, 357, 381-82. (Respondent's testimony). Respondent also disputed statements made by Mullen in an unsworn ``declaration'' to the effect that he had knowledge of the 2008 diversion incident and that both he and the office manager knew ``before 2012 that [she] was diverting drugs from his office.'' GX 20, at 1 (Mullen declaration); Tr. 381-82 (Respondent's testimony).\16\ While the opening sentence of Mullen's declaration states that she was ``duly sworn,'' nothing else in the declaration establishes that she appeared before a person authorized to administer oaths. See GX 20, at 4 (signature page). Nor does the declaration contain an attestation clause.\17\ See id.; see also 28 U.S.C. 1746. --------------------------------------------------------------------------- \16\ Both the office manager and Respondent also disputed Mullen's statement in the 2015 declaration that Respondent ``stood over me and at one point he leaned over me, grabbed my shoulder and shook me.'' GX 20, at 3; Tr. 86 & 369. \17\ On November 6, 2014, Mullen, along with her son, were indicted on multiple counts of violating 21 U.S.C. 841(a)(1) (unlawful distribution of hydrocodone and zolpidem), 846 (conspiracy to distribute hydrocodone and zolpidem), and 843(a)(3) (obtaining controlled substances by fraud), and a single count of violating 21 U.S.C. 843(a)(2) (use of a DEA registration number issued to another). GX 20, at 132-40. Mullen pled guilty to all six counts, and on July 17, 2015, she was sentenced to 18 months incarceration. Id. at 156-158. --------------------------------------------------------------------------- [[Page 28683]] Respondent further testified that he never authorized Mullen to call in prescriptions for pain medications and/or controlled substances using his name and DEA number. Tr. 319. Indeed, he asserted that Ms. Mullen ``doesn't know my DEA number.'' Id. When asked whether he ever authorized Mullen to fax in refill prescriptions, Respondent ``doubted that because whenever I gave out prescriptions for any kind of pain medicine . . . I would give that to the patient directly. And then if [the patient] needed a refill, I would refill it with the patient when I saw [him/her], so that was directly handed to the patient.'' Id. at 320. Asked whether he accepted responsibility for the ``diversion that occurred out of [his] office and under [his] identity,'' Respondent answered that Mullen ``was not entrusted with [his] DEA number'' and that ``there was nothing I could do to supplement that.'' Id. at 429. He further testified that when ``I found out about this, I acted immediately,'' and ``as far as . . . acting in the public interest, I think I did that.'' Id. Continuing, Respondent testified that ``[a]s far as if you're asking me if I accept responsibility for all of her diversion for the five years and so forth, I don't know how I could do that.'' Id. at 429-30. The DEA Administrative Inspection and Investigation On July 10, 2013, DEA Diversion Investigators executed an Administrative Inspection Warrant (AIW), presumably at Respondent's Roanoke office as it was his registered location.\18\ RX 88, at 1; Tr. 135. In testimony which was both confused and confusing, the DI stated that Respondent had various recordkeeping violations, which, in his view, included that the ``initial inventory wasn't listed.'' Tr. 135- 36. The DI then asserted that while Respondent ``had a dispensing log and it did have the number of pills that was dispensed each time and a running count . . . DEA requires a beginning inventory, which would actually . . . be the drug strength, the number of commercial containers or the size of the commercial containers.'' Id. at 136. However, on questioning by the ALJ as to whether the beginning inventory would be ``from the date that he opened his practice or . . . from the date that he received these particular drugs,'' the DI explained that ``[i]t would be from the last biennial inventory. So he did have a biennial inventory. So that we can use that as a beginning inventory.'' \19\ Id. at 137. After acknowledging that a biennial inventory is done ``[e]very two years,'' the DI acknowledged that ``we would use that biennial inventory or the initial inventory'' as the ``starting point.'' Id. at 137-38. --------------------------------------------------------------------------- \18\ The Government did not submit the AIW for the record and the DI did not testify to the exact date on which the AIW was executed. Tr. 135. I thus derive the date of the inspection from the closing inventory document, which was submitted by Respondent. RX 88. Even though the Show Cause Order alleged that various other records did not comply with the CSA and DEA regulations, the Government did not submit these either. \19\ The CSA does not use the term ``beginning inventory.'' See 21 U.S.C. 827(a)(1). Rather, it uses the term ``initial inventory'' to describe the requirement that ``every registrant . . . shall . . . as soon thereafter as such registrant first engages in the manufacture, distribution, or dispensing of controlled substances . . . make a complete and accurate record of all stocks thereof on hand[.]'' Id. While the CSA also requires a registrant who engages in the dispensing of controlled substances to take an inventory ``every second year thereafter,'' the statute calls this inventory a ``biennial inventory.'' See id. The term ``beginning inventory'' simply refers to an inventory that is used as the starting point for an audit of a registrant's handling of controlled substances. --------------------------------------------------------------------------- However, upon questioning by Government counsel, the DI testified that there was no beginning inventory, that this is the same as the initial inventory which must be created when a person first becomes registered and obtains drugs, and that there was also no biennial inventory. Id. at 138. Then asked if there were ``any other regulation violations in terms of the inventories that were required to be kept,'' the DI answered: ``No. Basically he didn't list the number of commercial containers or how many dosage units were in each commercial container.'' Id. The DI also testified that he found it troubling that Respondent's violations ``were similar'' to those found in the 2005 Consent Order, ``especially about the biennial inventory and initial inventory.'' Id. at 140. The DI further asserted that Respondent's recordkeeping violations ``should have been rectified . . . back in 2005,'' and that the records ``should have been done correctly . . . actually, ever since [Respondent] entered into the MOA with DEA.'' Id. at 141. The DI acknowledged, however, that Respondent had receipt records that went back beyond the period of the audit he conducted, which covered a period of two years. Id. at 161, 163. The DI also conceded that Respondent could account for nearly every pill he had obtained, the exception being that he was off three pills of hydrocodone 10/650 mg. Id. at 162-63. Regarding the recordkeeping allegation, Respondent testified that DHP's inspector who audited his records did not raise any issue with respect to his recordkeeping and ``said they were good.'' Id. at 397. Respondent testified that based on his conversation with the inspector, he continued to maintain the records in ``just the same way'' until the DI advised him as to the ``deficiencies he found.'' Id. at 398. Respondent then testified that as a result of his conversation with the DEA, he changed his recordkeeping practices ``right away.'' Id. The DI also testified that in the summer of 2015, he interviewed Respondent's office manager. Id. at 133. In the interview, the office manager denied any knowledge that prescriptions were being called-in in her name. Id. She also told the DI that Respondent was not ``aware of that.'' Id. The office manager also told the DI that ``sometimes the controlled substances, which would be [h]ydrocodone, Xanax, and [d]iazepam . . . would be left out for . . . her to administer to the patient.'' Id. at 134. The DI testified that the office manager is not a registrant and that she is not permitted to administer controlled substances when Respondent is not present because she is ``not registered'' and ``doesn't have the training to handle controlled substances.'' Id. The DI also testified that leaving the controlled substances out overnight is not permitted, and that under the Code of Federal Regulations, controlled substances ``have to be secured in a substantial cabinet,'' such as ``a steel cabinet'' or ``a safe.'' Id. Finally, the DI asserted that Respondent did not maintain effective controls against diversion because he was not monitoring his employee closely enough, id. at 142, and that Respondent ``has an obligation to know about any diversion that happens with his employees or any criminal information.'' Id. at 144. However, when asked by Government counsel if there were ``[a]ny other controls that [Respondent] should have been using,'' the DI answered: ``I don't believe so.'' Id. The DI conceded that Respondent no longer has controlled substances in his office. Id. at 165-66. He also acknowledged that he had looked at Respondent's prescriptions since 2013, and that none of these prescriptions raised any concern. Id. at 166. As to the allegation that he did not provide adequate security for the controlled substances that he left out of the safe the night before he would perform procedures, Respondent [[Page 28684]] testified that his office was in ``a freestanding building,'' that it was the only office in the building, that he had a security system that had motion and door detectors that was monitored, that the door and door frame to the drug room were made of steel, and that the door had a deadbolt lock. Id. at 305-10. He further testified that Ms. Mullen did not have a key to the room. Id. at 308. As for his practice of allowing his office manager to administer controlled substances to patients prior to procedures, Respondent testified that this ``was not a routine practice'' and occurred only ``on occasion.'' Id. at 336. Respondent added that this would occur if he was ``inevitably going to be late, right when the patient starts . . . complaining about that,'' prompting a call from his office manager ``asking[] if she [could] administer. . . the medicines.'' Id. at 337. Respondent explained that his office manager ``had already checked the [patient's] vitals,'' and that he ``would either say yes or no about that.'' Id. He also testified that he did procedures only one day a week, and that it ``would only be the first case in the morning, if that happened at all.'' Id. While Respondent testified that he would leave drugs outside of the safe (in the storage room) either the night before the procedure or if he had ``come in earlier in the morning,'' he further explained that he would leave out only the aliquot for ``just that one patient,'' and that it was kept ``behind the locked door'' of the drug room. Id. at 338-39. According to Respondent, opening the safe required both a key and a combination, but only he knew the combination. Id. at 340. Respondent stated that he had ended the practice of allowing his office manager to administer medication in September 2013, after a patient questioned the practice. Id. at 341. Asked by the ALJ whether he thought ``it was improper to have [his office manager] administer'' controlled substances to patients when he was ``not in the office,'' Respondent maintained that he ``thought it was a common practice.'' Id. at 431. He then maintained that ``my interpretation of the state code and publications by the Board of Medicine, it seemed like it was all right.'' Id. However, Respondent provided no such materials to corroborate that this practice complied with state law. Asked by the ALJ when he first started using the PMP, Respondent testified: ``August 24, 2012.'' Id.at 435. When then asked by the ALJ why he didn't ``use it prior to that time,'' Respondent asserted that he had tried several times but ``couldn't get a log-in.'' Id.; see also id. at 366-67. Respondent then testified that he later found out ``that the site had been hacked . . . in 2009'' but did not remember when he had tried to access the PMP. Id. at 367 & 435. Nor did he testify as to why he had previously sought to access the PMP. However, Respondent testified that he now monitors the state PMP every month to determine if someone is misusing his registration. Id. at 382. Discussion Under the CSA, ``[a] registration pursuant to section 823 of this title to manufacture, distribute, or dispense a controlled substance . . . may be suspended or revoked by the Attorney General upon a finding that the registrant . . . has committed such acts as would render his registration under section 823 of this title inconsistent with the public interest as determined under such section.'' 21 U.S.C. 824(a)(4). So too, ``[t]he Attorney General may deny an application for [a practitioner's] registration . . . if the Attorney General determines that the issuance of such registration . . . would be inconsistent with the public interest.'' Id. Sec. 823(f). In the case of a practitioner, see id. Sec. 802(21), Congress has directed the Attorney General to consider the following factors in making the public interest determination: (1) The recommendation of the appropriate State licensing board or professional disciplinary authority. (2) The applicant's experience in dispensing or conducting research with respect to controlled substances. (3) The applicant's conviction record under Federal or State laws relating to the manufacture, distribution, or dispensing of controlled substances. (4) Compliance with applicable State, Federal, or local laws relating to controlled substances. (5) Such other conduct which may threaten the public health and safety. Id. Sec. 823(f). ``[T]hese factors are . . . considered in the disjunctive.'' Robert A. Leslie, M.D., 68 FR 15227, 15230 (2003). It is well settled that I ``may rely on any one or a combination of factors, and may give each factor the weight [I] deem[] appropriate in determining whether'' to suspend or revoke an existing registration or deny an application. Id.; see also MacKay v. DEA, 664 F.3d 808, 816 (10th Cir. 2011); Volkman v. DEA, 567 F.3d 215, 222 (6th Cir. 2009); Hoxie v. DEA, 419 F.3d 477, 482 (6th Cir. 2005). Moreover, while I am required to consider each of the factors, I ``need not make explicit findings as to each one.'' MacKay, 664 F.3d at 816 (quoting Volkman, 567 F.3d at 222); see also Hoxie, 419 F.3d at 482.\20\ --------------------------------------------------------------------------- \20\ In short, this is not a contest in which score is kept; the Agency is not required to mechanically count up the factors and determine how many favor the Government and how many favor the registrant/applicant. Rather, it is an inquiry which focuses on protecting the public interest; what matters is the seriousness of the registrant's or applicant's misconduct. Jayam Krishna-Iyer, 74 FR 459, 462 (2009). Accordingly, as the Tenth Circuit has recognized, findings under a single factor can support the revocation of a registration. MacKay, 664 F.3d at 821. Likewise, findings under a single factor can support the denial of an application. --------------------------------------------------------------------------- Under the Agency's regulation, ``[a]t any hearing for the revocation or suspension of a registration, the Administration shall have the burden of proving [by substantial evidence] that the requirements for such revocation or suspension pursuant to . . . 21 U.S.C. [Sec. ] 824(a) . . . are satisfied.'' 21 CFR 1301.44(e). In this matter, I conclude that the Government's evidence with respect to Factors Two, Four, and Five \21\ supports the conclusion that Respondent has committed acts which render his ``registration inconsistent [[Page 28685]] with the public interest.'' 21 U.S.C. 823(f), 824(a)(4). While I agree with the ALJ's conclusion that a sanction is appropriate, I find that the record supports a stronger sanction than that recommended by the ALJ. --------------------------------------------------------------------------- \21\ With respect to Factor One, the Virginia Board has not made a recommendation to the Agency in this matter. Moreover, even under the broader view taken in numerous agency cases of what constitutes relevant evidence under this factor, the Virginia Board's 2005 restoration of Respondent's medical license to unrestricted status is of de minimis probative value in assessing whether his continued registration is consistent with the public interest given that the most serious allegations in this matter post-date the Board's action. Thus, the most that can be said for the Board's restoration of his medical license to unrestricted status is that Respondent currently possesses authority to dispense controlled substances under Virginia law and therefore meets the CSA's prerequisite for maintaining a practitioner's registration. See Frederic Marsh Blanton, 43 FR 27616 (1978) (``State authorization to dispense or otherwise handle controlled substances is a prerequisite to the issuance and maintenance of a Federal controlled substances registration.'') However, this finding is not dispositive of the public interest inquiry. See Mortimer Levin, 57 FR 8680, 8681 (1992) (``[T]he Controlled Substances Act requires that the Administrator . . . make an independent determination [from that made by state officials] as to whether the granting of controlled substance privileges would be in the public interest.''); see also Paul Weir Battershell, 76 FR 44359, 44366 (2011) (citing Edmund Chein, 72 FR 6580, 6590 (2007), pet. for rev. denied, Chein v. DEA, 533 F.3d 828 (D.C. Cir. 2008)). As to Factor Three, I agree with the ALJ that there is no evidence that Respondent has been convicted of an offense under either federal or state law ``relating to the manufacture, distribution or dispensing of controlled substances,'' 21 U.S.C. 823(f)(3), and that the simple possession offenses of which he has been convicted are properly considered under Factor Five. The Agency has recognized, however, there are a number of reasons why even a person who has engaged in criminal misconduct may never have been convicted of an offense under this factor, let alone prosecuted for one. Dewey C. MacKay, 75 FR 49956, 49973 (2010), pet. for rev. denied, MacKay v. DEA, 664 F.3d 808 (10th Cir. 2011). Thus, ``the absence of such a conviction is of considerably less consequence in the public interest inquiry'' and is therefore not dispositive. Id. --------------------------------------------------------------------------- Factors Two, Four and Five--Respondent's Experience in Dispensing Controlled Substances, Compliance with Applicable Laws Related to Controlled Substances, and Such Other Conduct Which May Threaten Public Health and Safety Respondent's Liability for Mullen's Misuse of His Registration In the Show Cause Order, the Government alleged that Respondent is ``responsible for the misuse of [his] registration by'' Ms. Mullen. ALJ Ex. 1, at 2. Moreover, in its post-hearing brief, the Government asserts that Respondent ``knew or should have known about the diversion that Ms. Mullen was committing under his name'' based on the fraudulent tramadol prescriptions that were brought to his attention by a pharmacist in November 2008. Gov. Post-Hrng. Br. 15-16. The Government notes Respondent's testimony that he ``didn't think [these acts of diversion] had anything to do with him,'' even though the prescriptions were called in under his name, and argues that ``he admitted [that] he made no changes in his office practices, did not discuss the situation with his employees and did not begin to use Virginia's PMP to monitor the drugs being prescribed under his'' registration. Id. at 16-17. The Government then argues that the Agency has consistently applied the principle ``that a registrant bears responsibility for the misuse of their [sic] registration . . . by an employee.'' Id. at 17. Also pointing to the ``testimony'' it presented in the form of Ms. Mullen's unattested declaration, the Government argues that Respondent entrusted his registration to Ms. Mullen because her ``duties also included occasionally calling-in patient prescriptions to pharmacies.'' Id. at 20. The ALJ rejected the allegation, reasoning that the Government did not prove that Respondent ``provide[d] Mullen with access to his registration number expressly, impliedly, or negligently,'' R.D. 34, or that Respondent either had knowledge or was willfully blind to Mullen's actions prior to August 20, 2012. Id. at 35. While I agree with the ALJ that the Government's proof was inadequate to support the imposition of liability for entrusting his registration to Mullen, I disagree with substantial aspects of the ALJ's reasoning. First, the ALJ's opinion suggests that he gave weight to Respondent's testimony that he did not believe that the 2008 incident had anything to do with him. See R.D. 35. Specifically, in rejecting the Government's contention that ``Respondent should have monitored Mullen and his PMP report, the ALJ reasoned, in part, that ``the 2008 fax \22\ did not contain any information that suggested that one of Respondent's employees was involved'' and that ``the refill prescription was not written for one of the Respondent's patients.'' Id. --------------------------------------------------------------------------- \22\ While there was a 2008 fax, this document was generated by Respondent in response to the call from the pharmacist questioning the prescriptions, which were phoned-in. --------------------------------------------------------------------------- As for Respondent's contention that he did not believe the incident involved him, the incident obviously involved him because his name was being used as the purported issuer of the prescriptions. Moreover, neither Respondent nor the ALJ explained why one would reasonably expect an employee who was engaged in criminal activity by calling in fraudulent prescriptions to give her actual name. Indeed, with respect to the person who was calling in the prescriptions, there were only two possibilities: either the prescriptions were being called in by someone who did not work for him or by someone who did.\23\ The record does not, however, establish whether the pharmacist told Respondent that ``Liz Norville'' (Mullen) had provided Respondent's phone number in the voice mail message that she left for the prescription. --------------------------------------------------------------------------- \23\ I acknowledge the possibility that someone outside of a physician's practice could call-in (or fax-in) a fraudulent prescription to a pharmacy. Thus, obtaining the phone number provided by the caller (or the number used to fax the prescription) would tend to eliminate one of the two possible sources of the prescription's origin. There is, however, no evidence that the pharmacist told Respondent that ``Liz Norville,'' the name Mullen used on this occasion, had provided his office phone number when she called in the prescriptions, or whether the pharmacy had obtained Respondent's phone number from its dispensing software. --------------------------------------------------------------------------- I agree with the ALJ that the Government did not prove that Respondent either had actual knowledge of, or was willfully blind to, Mullen's criminal behavior until August 20, 2012.\24\ R.D. 35-36. However, DEA has previously held that ``[c]onsistent with a registrant's obligation to `provide effective controls and procedures to guard against theft and diversion of controlled substances,' every registrant has a duty to conduct a reasonable investigation upon receiving credible information to suspect that a theft or diversion had occurred.'' Rose Mary Jacinta Lewis, 72 FR 4035, 4042 (2007) (quoting 21 CFR 1301.71(a)). Thus, the Government is not required to show that a registrant either had actual knowledge of, or was willfully blind to, an employee's or agent's criminal behavior.\25\ --------------------------------------------------------------------------- \24\ As noted previously, in support of its contention that Respondent authorized Mullen to use his registration and was also aware that she was diverting controlled substances, the Government produced an unattested declaration by Ms. Mullen. Notwithstanding that some of the statements made by Mullen in this document are corroborated by other evidence, the Government's failure to ensure that Ms. Mullen attested to the truth of her statements under penalty of perjury renders this document inherently unreliable. \25\ The Government did not explicitly cite this duty or Jacinta Lewis in the Show Cause Order, its Pre-Hearing Statements, or its Post-Hearing brief. Because I reject the Government's contentions as to the steps Respondent should have taken but did not following the 2008 incident, I need not decide whether the Government failed to provide adequate notice of its intent to rely on this duty in this matter. --------------------------------------------------------------------------- The Agency has further explained that ``the precise scope of'' the duty to investigate ``necessarily depends upon the facts and circumstances.'' Id. Moreover, a registrant's duty to investigate potential theft or diversion by his employees (or agents) applies to all such acts, regardless of whether the employee has been entrusted with authority to use his registration. Cf. John V. Scalera, 78 FR 12092 (2013). In Scalera, the former Administrator denied a physician's application for registration, based, in part, on his testimony that he ``had no idea'' and did not ``know anything about'' how unlawful prescriptions that were issued under his name as the prescriber were either called-in or faxed to the pharmacies. Id. at 12095-96; see also id. at 12099. The Administrator further noted the physician's testimony that ``there was not enough evidence to convince him that any of his employees had actually called in the prescriptions with his surrendered number.'' Id. at 12097; see also id. at 12099. Notably, the former Administrator denied the physician's application notwithstanding that there was no showing that the physician had entrusted his registration to any employee,\26\ holding that ``[h]aving failed to explain why the . . . prescriptions were called in, [r]espondent has offered no credible assurance that similar acts will not occur in the future''). Id. at 12100. --------------------------------------------------------------------------- \26\ In Scalera, the physician had previously surrendered his registration. 78 FR at 12094. While the physician testified that office employees had access to his registration number, there was no showing by the Government that the physician had authorized the employees to call in prescriptions. --------------------------------------------------------------------------- Nonetheless, the Agency has not previously held that the potential misuse by an employee or agent of a [[Page 28686]] practitioner's state prescribing authority to divert a non-federally controlled drug triggers the duty to investigate whether his DEA registration has also been misused. I now hold that where a registrant is provided with credible information that his state prescribing authority is being used to divert a state-controlled (but not federally-controlled) drug, such information triggers the duty to investigate whether his DEA registration is also being used to divert federally controlled substances. However, as this is a new and additional duty beyond that which was announced in Jacinta Lewis, which applies only to a practitioner's receipt of information that his DEA registration is being misused, I conclude that it cannot be retroactively imposed on Respondent. Moreover, even if the duty had been announced prior to the 2008 incident, I would find unpersuasive the Government's contention that Respondent should be held liable because ``he made no changes in his office practices, did not discuss the situation with his employees and did not begin to use Virginia's PMP to monitor the drugs being prescribed under his DEA number.'' Gov. Post-Hrng. Br., at 16-17. See also id. at 21 (arguing that ``[e]ven assuming . . . that [Respondent] did not know of Ms. Mullen's diversion, his failure to discover it over a five-year period and his failure to properly monitor Ms. Mullen or to even check his own PMP report demonstrates a gross and reckless disregard for his responsibilities as a registrant and for the public health and safety''). The Government offered no explanation as to what changes Respondent should have made to his office practices (other than to check his PMP report) or other steps he should have taken ``to properly monitor Ms. Mullen.'' As for its claim that Respondent did not discuss the situation with his employees, while there is evidence that he did not discuss the matter with Mullen, perhaps Mullen would have confessed and perhaps not. Thus, it is unclear what this would have accomplished. Finally, as for the contention that Respondent should have checked his own PMP report, under Virginia law in effect at the time of the 2008 incident, Respondent was not authorized to obtain a PMP report showing his own prescribings. See Va. Stat. Sec. 54.1-2523.B & C (2008). Indeed, Virginia law did not authorize the disclosure by the PMP Director of this information until 2013.\27\ See 2013 Va. Laws Ch. 739(H.B. 1704) (Amending Va. Code Sec. 54.1-2523.C by authorizing the Director to disclose, ``in his discretion,'' ``.8 Information relating to prescriptions for covered substances issued by a specific prescriber, which have been dispensed and reported to the program, to that prescriber.''). --------------------------------------------------------------------------- \27\ The Government argues that Respondent's ``failure to discover [Mullen's diversion] over a five-year period and his failure to properly monitor'' her ``demonstrates a gross and reckless disregard for his responsibility as a registrant.'' Notably, the Government does not explain by what method Respondent should have discovered Mullen's diversion when the state police detective acknowledged that he did not tell Respondent about Mullen's 2008 arrest and the subsequent convictions until the August 2012 incidents, and only a single pharmacy questioned the dosing of a prescription (but not its legitimacy) after the 2008 incident. Given the scope of the diversion, there is much about this case (such as the failure of the detective to tell Respondent of Mullen's arrest and convictions, not to mention that the terms of her probation did not prohibit her from working in a doctor's office; the fact that prescriptions which were missing Respondent's DEA number were routinely filled notwithstanding that they were facially invalid; as well as that the prescriptions were for hydrocodone in quantities and dosings that were clearly outside of the scope of what is usually prescribed by podiatrists), which is deeply disturbing. While the Government believes Respondent's and his office manager's testimony as to his lack of knowledge is implausible, the burden was on the Government to prove otherwise under the theory it advanced in this case. --------------------------------------------------------------------------- Nonetheless, where a practitioner receives credible information that fraudulent prescriptions under his name are being presented for state but not federally-controlled drugs, and the state PMP permits a practitioner to obtain information as to his controlled substance prescribings, that practitioner has a duty to obtain that information and to determine whether unlawful prescriptions for federally controlled substances are also being dispensed under his registration. Moreover, even if state law does not authorize a practitioner to obtain a PMP report of the dispensings which have been attributed to him, a practitioner is obligated to obtain that information from a pharmacy that reports a fraudulent prescription to him. If information obtained from either the PMP or a pharmacy shows that one's registration is being misused, a registrant must report that information to DEA (as well as local law enforcement authorities) even if the practitioner concludes that no employee or agent is involved in the misuse of his registration.\28\ A practitioner is not excused from this duty because others, who also have responsibilities to investigate, such as law enforcement officers and pharmacists, failed to carry out those responsibilities. --------------------------------------------------------------------------- \28\ Depending upon the extent of the misuse, the practitioner may need to request the cancellation of his registration number and the issuance of a new registration number. --------------------------------------------------------------------------- In conclusion, I agree with the ALJ's legal conclusion that on this record, the Government has not sustained the allegation that Respondent is liable for Mullen's criminal misconduct. However, regardless of whether a registrant has entrusted his registration to an employee, upon receiving credible information that his registration may be the subject of misuse, a registrant has a duty to conduct a reasonable investigation to determine whether his employees are involved in the misuse of his registration. A failure to do so constitutes ``other conduct which may threaten the public health and safety.'' 21 U.S.C. 823(f)(5). To establish a violation of this duty, the Government is not required to prove that the registrant had actual knowledge or was willfully blind to the fact that an employee was engaged in diversion. Rather, the Government is required to show only that the registrant received credible information creating a suspicion that his registration was being misused, that reasonable measures were available to the registrant to determine if his/her employee or agent was misusing his registration, and that the registrant failed to take such measures. Respondent's Continued Employment of Mullen After He Became Aware of Her Criminal Conduct As found above, even after Mullen admitted to Respondent that she had submitted the fraudulent refill authorization for hydrocodone and he was told by Detective Findley that Mullen had a history of submitting fraudulent prescriptions which included the 2008 tramadol prescriptions, Respondent continued to employ Mullen. Indeed, within days of receiving this information, Respondent found the state court records showing that Mullen had pled guilty to obtaining prescription drugs by fraud. He also obtained a PMP report showing that from January 21, 2008 through August 24, 2012, Mullen had filled 56 prescriptions/ refills for 90 dosage units of hydrocodone 10 mg and 26 prescriptions/ refills for zolpidem 10 mg. Respondent nonetheless continued to employ Mullen for another five weeks, asserting that he needed to retain her because she was his insurance clerk and needed her to maintain his cash flow while a new insurance clerk was hired and trained. The ALJ rejected the Government's contention that Respondent violated 21 CFR 1301.92 because he continued to employ Mullen ``even after learning of her diversion.'' Show Cause Order (ALJ [[Page 28687]] Ex. 1), at 2; R.D. 37-38. According to the ALJ, this regulation ``does not require the immediate termination of an employee; it only requires that the employer immediately assess the employee's conduct to determine what employment action to take against the employee.'' R.D. 37. In the ALJ's view, ``Respondent immediately assessed both the seriousness of Mullen's violations and her position of responsibility, as required under'' the regulation. Id. The ALJ also gave weight to Respondent's testimony that while Mullen remained in his employment, he moved the fax machine into the secure medication room, took away her office keys, called local pharmacies to alert them to Mullen's actions, and monitored his DEA number on the PMP system.\29\ R.D. 37. The ALJ further gave weight to the testimony that Respondent needed to retain Mullen for this period because 99 percent of his cash flow came from insurance payments and ``no replacement could immediately fill Mullen's position so as to continue the Respondent's normal business operations,'' even though Respondent acknowledged that his ``office manager was competent to perform these duties.'' Id. at 38. --------------------------------------------------------------------------- \29\ The ALJ also found that ``Respondent's office manager monitored Mullen from August 20, 2012, until she left the Respondent's employment.'' R.D. 37 (citing Tr. 79). The cited testimony involved only the question by Respondent's counsel: ``Do you recall whether you were more vigilant watching Ms. Mullen during that month that she was still there?'' followed by the office manager's answer: ``I would say yes.'' Tr. 79. The office manager did not, however, offer any further testimony explaining in what manner she was more vigilant in watching Mullen during this period. --------------------------------------------------------------------------- Continuing, the ALJ explained that ``[f]or small businesses that depend on each employee performing essential business functions, it is reasonable to expect that terminating an employee can be a process rather than an instantaneous action.'' Id. The ALJ then rejected the allegation, concluding that Respondent had acted ``[c]onsistent with the requirements of 21 CFR 1301.92'' by taking ``immediate action towards terminating Mullen's employment because of her misconduct.'' Id. Section 1301.92 is contained in a section of part 1301 which follows the heading: ``EMPLOYEE SCREENING-NON-PRACTITIONERS,'' thus raising the question, which was not addressed by either party or the ALJ as to whether it even applies to Respondent who is a practitioner. I need not decide this question because under the public interest standard applicable to practitioners, the Agency's authority includes not only those acts that constitute violations of its regulations, it also includes ``[s]uch other conduct which may threaten the public health and safety.'' \30\ 21 U.S.C. 823(f)(5). --------------------------------------------------------------------------- \30\ Notwithstanding that the Government did not cite Factor Five with reference to this allegation, Respondent clearly knew that his conduct in retaining Mullen in his employment after discovering that she was diverting drugs was at issue in the proceeding and put on a full defense against the allegation. Of consequence, the public interest factors do not impose substantive legal duties which can be violated, but simply shape the scope of relevant evidence in the proceeding, and Respondent clearly knew throughout the proceeding that the Government was alleging that his retention of Mullen was conduct which renders his registration inconsistent with the public interest. ALJ Ex. 1, at 1-2 (citing 21 U.S.C. 824(a)(4) and 823(f)). Of further note, 21 CFR 1301.76(a), which is titled ``[o]ther security controls for practitioners,'' provides, in part, that ``[t]he registrant shall not employ as an agent or employee who has access to controlled substances, any person who has been convicted of a felony offense relating to controlled substances.'' --------------------------------------------------------------------------- Moreover, whether I were to apply section 1301.92 or evaluate Respondent's conduct under Factor Five, I would come to the same result. Here, the evidence shows that by August 24, 2012, Respondent knew that Mullen had been convicted in state court of two counts of prescription fraud. And once he obtained the PMP report which showed the controlled substances prescriptions she obtained under his DEA registration, Respondent knew that Mullen had committed at least another 82 felony offenses of prescription fraud. To the extent the ALJ's recommendation suggests that Respondent properly ``assessed . . . the seriousness of Mullen's violations,'' R.D. 37, I disagree. Indeed, proof that Mullen had committed a single act of prescription fraud should have resulted in her immediate termination. Of further note, when confronted on cross-examination as to why he retained Mullen even after he obtained the PMP report, Respondent attempted to minimize the scope of Mullen's misconduct when he testified that ``I acted upon the, you know, the proportion of things that I knew. So it wasn't--it wasn't what we're looking at in retrospective now with this huge situation. It was only with a handful of information that I had, less than a dozen.'' Tr. 426. However, by August 24, 2012, Mullen's criminal conduct in obtaining prescriptions for herself alone made this an indisputably ``huge situation'' given that she had obtained more than 5,000 dosage units of hydrocodone 10 mg, the strongest dosage form of this highly abused controlled substance, not to mention another 780 dosage units of zolpidem. Notably, the ALJ, in his discussion as to why he rejected the Government's contention that Respondent should have immediately fired Mullen, did not address this testimony. I also disagree with the ALJ that the measures undertaken by Respondent justify his failure to immediately terminate Mullen. As for his moving the fax machine into the secure medications room, this did not address Mullen's ability to phone in prescriptions. So too, while Respondent took away Mullen's keys to the office, obviously she was allowed into the office in order to train her replacement and Respondent offered no testimony that anyone was watching Mullen on those days when he was at his other offices. As for the ALJ's finding that Respondent ``monitored his DEA number on the PMP system,'' R.D.37, while Respondent claimed he did this ``every month,'' Tr. 382, he offered conflicting testimony as to when he started doing so. Specifically, after testifying that he checked the PMP every month to see if anyone was misusing his number, when then asked by his counsel if he had found any misuse since August 2012, Respondent answered: ``No. I will say I've been doing every month for approximately a year, nine months, something like that that. No, no deviations there.'' \31\ Id. at 382-83. Yet when later asked by the ALJ ``when did you start using the PMP on a regular basis?'' Respondent answered: ``August 24 of 2012.'' Id. at 435. Not only is this conflict in his testimony unresolved, Respondent did not testify as to any other instance during the remaining period of Mullen's employment in which he accessed the PMP to determine what prescriptions were being dispensed under his registration. --------------------------------------------------------------------------- \31\ Even if Respondent meant that he had been checking the PMP for one year and nine months (since the date of the hearing), this still would not support a finding that he had commenced doing so every month since August 2012 and did so while Mullen remained employed with him. --------------------------------------------------------------------------- To be sure, there is evidence that Respondent called local pharmacies to alert them to Mullen's actions. Yet the evidence also shows while Respondent claimed to have called ``a handful of these'' pharmacies on August 20, 2012 (the day the refill authorization form was found on the fax), at least 12 refills for 90 or 120 dosage units of hydrocodone were nonetheless dispensed by several of these pharmacies after that date, including by those he called. Moreover, Respondent saw patients at four different locations [[Page 28688]] in southwestern Virginia, and while there is no evidence as to the number of pharmacies in this area of Virginia, presumably there are more than ``a handful.'' I further reject Respondent's contention that he was justified in continuing to employ Mullen because he needed to maintain his cash flow while a new insurance clerk was hired and trained. The evidence showed that Respondent's office manager could have performed these duties, and while she testified that she could not do so and perform her other duties, no evidence was offered that Respondent could not have hired someone to fill the office manager's duties or that he could not have hired a billing service. Moreover, Respondent offered no evidence that he did not have access to other sources of funds (such as his savings, credit cards, or a line of credit) to support his practice while a new insurance clerk was hired and trained. As for the ALJ's suggestion that Respondent acted reasonably because he ran a small business and Mullen performed an essential business function, a DEA registrant is obligated at all times to act in the public interest. It is true that ``there was no evidence that Mullen used her position in . . . Respondent's office to generate any fraudulent prescriptions after August 20, 2012.'' R.D. 38. Respondent was nonetheless willing to risk causing additional harm to the public health and safety. His conduct in continuing to employ a serial diverter clearly constitutes ``conduct which may threaten the public health and safety.'' 21 U.S.C. 823(f)(5) (emphasis added). The Recordkeeping Allegations Pursuant to 21 U.S.C. 827(a)(1), ``every registrant shall . . . as soon . . . as such registrant first engages in the manufacture, distribution, or dispensing of controlled substances . . . and every second year thereafter, make a complete and accurate record of all stocks thereof on hand.'' See also 21 CFR 1304.11(c) (``After the initial inventory is taken, the registrant shall take a new inventory of all stocks of controlled substances on hand at least every two years.''). Moreover, ``[e]ach inventory shall contain a complete and accurate record of all controlled substances on hand on the date the inventory is taken. . . . The inventory may be taken either as of opening of business or as of the close of business on the inventory date and it shall be indicated on the inventory.'' Id. Sec. 1304.11(a). The evidence shows that in 2005, Respondent entered into a Consent Order which found that he ``did not establish an initial inventory.'' GX 3, at 1-2. Moreover, during the July 2013 inspection, Diversion Investigators found that Respondent did not have a biennial inventory which was based on an actual count of the drugs on hand as required by DEA regulations. See 21 CFR 1304.11(a) & (c). Rather, he maintained a perpetual inventory, which was not based on an actual count of the drugs on hand at the required biennial interval, but rather, as the ALJ found, was ``a mathematical calculation of how many [controlled substances] the Respondent should have had after dispensing the listed amounts.'' R.D. 41. Thus, I agree with the ALJ that Respondent violated 21 U.S.C. 827(a) by failing to establish an initial inventory (as found in the 2005 Consent Order) and by failing to ``make a complete and accurate'' biennial inventory. R.D. 40-41. In his Exceptions, Respondent raises two contentions to the ALJ's findings. First, he argues that because he was engaged in administering medication to his patients, he was ``not required to perform the initial and biennial inventories that are required of other registrants.'' Exceptions, at 1 (citations omitted). Respondent points to 21 U.S.C. 827(c)(1)(B), which states, in relevant part, that the recordkeeping provisions of section 827 ``shall not apply . . . to the administering of a controlled substance in schedule II, III, IV, or V unless the practitioner regularly engages in the dispensing or administering of controlled substances and charges his patients, either separately or together with charges for other professional services, for substances so dispensed or administered.'' Exceptions, at 1-2. Respondent argues that ``DEA had the burden of proof as to this allegation,'' and because the Government failed ``to offer evidence that [he] falls into the statutory exception,'' the allegation must be rejected. Id. at 2. Respondent further maintains that ``[t]his is not a case where [he] seeks to invoke a statutory exception; rather, DEA seeks to invoke it.'' Id. Respondent is mistaken. Section 827(a) states that ``[e]xcept as provided in subsection (c) of this section . . . every registrant shall . . . as soon . . . as such registrant first engages in the . . . distribution[] or dispensing of controlled substance, and every second year thereafter, make a complete and accurate record of all stocks thereof on hand.'' (emphasis added). Thus, section 827(a) makes plain that the provisions of subsection C are simply exceptions to the provisions of subsection A and B, which are generally applicable to all registrants. Fatal to Respondent's contention is 21 U.S.C. 885(a)(1). It provides that: It shall not be necessary for the United States to negative any exemption or exception set forth in this subchapter in any complaint, information, indictment, or other pleading or in any trial, hearing, or other proceeding under this subchapter, and the burden of going forward with the evidence with respect to any such exemption or exception shall be upon the person claiming its benefit. 21 U.S.C. 885(a)(1) (emphasis added). By its plain terms, this provision applies not only to criminal proceedings but also to suspension and revocation proceedings. Because section 827(c) is clearly an exception to the generally applicable recordkeeping requirements and Respondent is ``the person claiming its benefit,'' he had the burden of producing evidence to show why he was entitled to the exception. Id. As Respondent produced no evidence showing that he did not ``charge[ ] his patients, either separately or together with charges for other professional services, for substances so dispensed or administered,'' id. Sec. 827(c)(1)(B), he is not entitled to claim the exception. I therefore reject Respondent's exception and hold that Respondent violated section 827(a) by failing to maintain proper inventories.\32\ --------------------------------------------------------------------------- \32\ As Respondent did not maintain a proper initial and biennial inventory at all, these are the violations he committed. Having made these findings, I agree with Respondent that the ALJ's additional findings that his inventory did not contain the number of containers and the number of units or volume in each container, see R.D. at 42, ``are subsumed under the `greater' violation'' of failing to take a biennial inventory. Exceptions, at 3. --------------------------------------------------------------------------- The Failure To Maintain Adequate Physical Security Allegation As found above, on occasion, the night before he was to perform a procedure, Respondent would set out in a cup--outside of the controlled substance safe--the controlled substances that his office manager was to provide to his first patient. However, the evidence shows that the drugs were nonetheless kept locked in his medication room which was secured with a steel door (and door frame) that had a deadbolt lock. The evidence also shows that this office was a freestanding building and that Respondent had a security monitoring system. The ALJ rejected the Government's contention that Respondent violated 21 CFR 1301.75, which provides that ``[c]ontrolled substances listed in [s]chedules II, III, IV, and V shall be [[Page 28689]] stored in a securely locked, substantially constructed cabinet.'' R.D. 43-44. Noting that the Agency's regulations do not define the term ``substantially constructed cabinet,'' the ALJ explained that at least one prominent dictionary provides a definition of the term ``cabinet'' which includes ``[a] small or private room set aside for some specific activity.'' R.D. 44 (quoting American Heritage Dictionary of the English Language 185 (1976)). The ALJ further gave ``consideration to the factors contained in 21 CFR 1301.71(b)'' and found that Respondent's use of the Extra Meds Room ``to store his controlled substances substantially complied with the requirements of 21 CFR 1301.71(b).'' Id. Of note, section 1301.75(b) does not require that most schedule II through V controlled substances be stored in a safe, and indeed, section 1301.75(e) specifies two drugs (carfentanil etorphine hydrochloride and diprenorphine) which ``shall be stored in a safe or steel cabinet equivalent to a U.S. Government Class V security container.'' 21 CFR 1301.75(b) & (e). And while the use of the word ``cabinet'' to describe a small room appears archaic,\33\ I agree with the ALJ that in light of the small amount of controlled substances that were stored outside of the safe and the level of security provided by the medication room and the office's alarm system, Respondent nonetheless remained in substantial compliance with section 1301.75 when he left the drugs outside of the safe but locked in the medication room. --------------------------------------------------------------------------- \33\ See Merriam-Webster.com. Merriam-Webster, n.d. Web. 22 May 2017. --------------------------------------------------------------------------- Aiding and Abetting the Unlawful Distribution of Controlled Substances by an Unregistered Person The Government alleged and the ALJ found that Respondent aided and abetted the unlawful distribution of controlled substances when he allowed his office manager to administer the controlled substances, which he had set out in the drug room the night before, to those patients who were undergoing procedures and he had yet to arrive at his office. R.D. 44-46. The evidence showed that Respondent's office manager did not hold a registration to dispense controlled substances.\34\ Id. at 44 (citing Tr. 57). The ALJ further rejected Respondent's contention that his office manager was exempt from registration under 21 CFR 1301.22(a) because in administering the drugs, she was Respondent's ``agent or employee'' and was ``acting in the usual course of . . . her business or employment.'' Id. at 45. --------------------------------------------------------------------------- \34\ Nor does she hold any DEA registration. Tr. 57. --------------------------------------------------------------------------- In so holding, the ALJ reasoned that because in his post-hearing brief, ``Respondent described [the office manager's] administration of controlled substances as occurring only on `limited occasions,' '' ``Respondent himself argued . . . that [she] did not administer controlled substances in the usual course of business.'' Id. (quoting Resp. Post-Hrng. Br. 38). Continuing, the ALJ explained that he was ``find[ing] as a matter of fact that [the office manager's] administration of controlled substances was described repeatedly as `occasional,' which is the opposite of `usual.' Therefore, 21 [CFR] 1301.22(a) does not apply.'' Id. Respondent takes exception to the ALJ's legal conclusion. He argues that his office manager was an agent within the meaning of the CSA, which defines the term as ``an authorized person who acts on behalf of or at the direction of a manufacturer, distributor, or dispenser.'' Exceptions, at 4 (quoting 21 U.S.C. 802(3)). Respondent further notes that ``[w]hile the phrase `in the usual course of business' is used many times in the CSA and the associated regulations, it is not defined.'' Id. at 5 (citing 21 U.S.C. 822(c); 21 CFR 1300.04). Respondent then maintains that ``[t]he fact that a business practice occasionally, or on limited occasions, does not mean that it is not in the usual course of that business.'' Id. Respondent argues that the testimony shows ``that during the course of [his] surgical practice, it was in the usual course of business for [the office manager] to administer medication in lieu of [his] doing it personally when [he] was not going to be in the office when the surgery patient arrived[.]'' Id. Respondent thus contends that the office manager ``was acting as [his] agent and employee within the scope of her responsibilities and duties'' and was not required ``to be registered.'' Id. Respondent thus contends that he ``did not aid and abet an illegal distribution of a controlled substance under 21 U.S.C. 841(a).'' Id. I need not decide whether the frequency of the office manager's administrations of controlled substances to Respondent's patients was sufficient to establish that she was acting in the usual course of her employment when she did so. Rather, I conclude that because under Virginia law, the office manager could not legally administer controlled substances to Respondent's patients, it does not matter whether she did so only ``on limited occasions'' or routinely, and that because her conduct was unlawful, it cannot qualify under section 822(c) as ``acting in the usual course of [a registrant's] business or employment.'' The Virginia Drug Control Act defines the term ``[a]dminister [to] mean[ ] the direct application of a controlled substance, whether by injection, inhalation, ingestion, or any other means, to the body of a patient . . . by (i) a practitioner or by his authorized agent and under his direction or (ii) the patient . . . at the direction and in the presence of the practitioner.'' Va. Code Sec. 54.1-3401. Even assuming that the office manager's conduct in providing the drugs to patients falls within the provision allowing a practitioner's ``authorized agent'' to do so, the Virginia Drug Control Act contained extensive and detailed provisions governing the circumstances in which drugs can be administered by someone other than a licensed prescribing practitioner. See id. Sec. 54.1-3408. Relevant here is subsection U, which states: Pursuant to a specific order for a patient and under his direct and immediate supervision, a prescriber may authorize the administration of controlled substances by personnel who have been properly trained to assist a doctor of medicine or osteopathic medicine, provided the method does not included intravenous, intrathecal, or epidural administration and the prescriber remains responsible for such administration. Id. Sec. 54.1-3408.U. Even assuming that this provision allows a doctor of podiatry \35\ to authorize his employee to administer a controlled substance to his patient, the evidence shows that Respondent would approve the administration when he was ``going to be late,'' prompting his office manager to call and ask ``if she [could] administer . . . the medicines.'' Tr. 337. Respondent was not in the office when this occurred, and while he asserted that [[Page 28690]] ``he thought it was a common practice'' and was permitted by the Board of Medicine, he produced no materials from the Board such as an opinion letter or Board decision that would support his contention that even though he was not physically present in the office, he was nonetheless engaged in the ``direct and immediate supervision'' of his office manager when he authorized his office manager to administer the drugs to the patients. --------------------------------------------------------------------------- \35\ While this provision specifically refers to ``a doctor of medicine or osteopathic medicine,'' Va. Code Sec. 54.1-3408.U, subsection A refers to ``[a] practitioner of medicine, osteopathy, podiatry, dentistry, or veterinary medicine.'' Id. Sec. 54.1- 3408.A. In his Post-Hearing Brief, Respondent implies that this practice was lawful under the Board of Medicine's Rules governing Office-Based Anesthesia. Resp. Post-Hrng. Br. 50. He specifically notes that Board's ``requirements for office based anesthesia'' do not apply to ``[m]inimal sedation/anxiolysis.'' Id. (quoting 18 Va. Admin. Code 85-20-320(A)(1). That may be (even though there is no evidence as to whether the cocktail of drugs that were given to the patients resulted in the inducement of ``minimal sedation/ anxiolysis'' or ``moderate sedation/conscious sedation,'' which is subject to the requirements for office-based anesthesia), but this argument does not address whether Respondent's practice of having his office manager administer the drugs to the patients in his absence was lawful under Va. Code Sec. 54.1-3408.U. --------------------------------------------------------------------------- Accordingly, I reject Respondent's exception that his office manager was exempt from registration because she was ``acting in the usual course of [her] . . . employment'' and that he is not liable for aiding and abetting the unlawful distribution of controlled substances. As explained above, I further hold that on those occasions when Respondent was not physically present in the office and his office manager administered the controlled substances to various patients, she engaged in an unlawful distribution under 21 U.S.C. 841(a)(1).\36\ I further agree with the ALJ that Respondent aided and abetted these violations and that this conduct is actionable under Factor Four. R.D. 46; see also 18 U.S.C. 2. --------------------------------------------------------------------------- \36\ In his Exceptions, Respondent argues that ``[t]here is no DEA precedent for finding [the office manager's] conduct to be an illegal distribution.'' Exceptions, at 5 (citing Fred Samimi, 79 FR 18698 (2014), and Margy Temponeras, 77 FR 45675 (2012)). Discussing Samimi, Respondent states that ``Dr. Samimi was found by the State of California to have aided and abetted the unlicensed practice of medicine by allowing his staff to dispense (not administer) controlled substances when he was not present. In sustaining that finding as relevant to her consideration, the Administrator made no suggestions that Dr. Samimi's actions violated the CSA.'' Id. And discussing Temponeras, Respondent noted that ``Dr. Temponeras had unregistered employees dispensing (not administering) drugs to patients by filling prescriptions while she was not actually present[,]'' and that while ``the Administrator found that Dr. Temponeras violated the CSA because she was not registered as a dispenser and . . . violated Ohio law by allowing unlicensed individual[s] to fill controlled substance[ ] prescriptions . . . there was no reference to Dr. Temponeras' conduct as constituting illegal distributions.'' Id. at 5-6 (int. quotations omitted). Neither case supports Respondent. As for Samimi, the Government never argued that the physician's practice of allowing unlicensed staff to dispense controlled substances without being directly supervised by him constituted a violation of 21 U.S.C. 841, and thus, that case did not address the question of whether an unregistered person can administer controlled substances to a patient outside of the presence of the physician. See 79 FR at 18698 (discussing allegations of Show Cause Order); id. at 18710 (discussing state board's findings and relevant state law prohibiting practice of allowing unlicensed and unsupervised office staff to dispense drugs). As for Temponeras, the Agency's decision found that the physician, who was not registered as a pharmacy, ``exceeded the authority of her registration because she authorized her employees to fill prescriptions issued by her father.'' 77 FR at 45677. Notably, the decision cited both 21 U.S.C. Sec. 822(b), which provides that a registrant is authorized to engage in controlled substances activities ``to the extent authorized by [his] registration and in conformity with the other provisions of'' the CSA, and Sec. 841(a), which renders unlawful the knowing or intentional distribution of a controlled substance ``[e]xcept as authorized by'' the CSA. Thus, Respondent's assertion that ``[i]n Temponeras, there was no reference to Dr. Temponeras' conduct as constituting `illegal distributions' '' misstates the case. Exceptions, at 6. --------------------------------------------------------------------------- The State Court Convictions As the ALJ found, in 2000, Respondent pled guilty in state court to four felony counts of the unlawful possession of controlled substances which included sufentanil, oxycodone, pethidine, and hydromorphone, as well as one misdemeanor count of unlawful possession of marijuana. R.D. 47. While the ALJ noted that the Agency had ``declined to revoke'' Respondent's registration based on these convictions and the convictions were over 15 years old, he rejected Respondent's contention that because the Agency entered into the Memorandum of Agreement (MOA) with Respondent it is now estopped from seeking revocation based on these convictions. Id. Respondent takes exception to the ALJ's ruling. Exceptions, at 10- 11. He argues that that ``[t]he ALJ cited no basis for his finding that the MOA did not estopped [sic] DEA from relying on [his] 2000 conviction [sic] in its attempt to sanction him today.'' Id. at 10. He also argues that he ``has not found an agency decision that relied on conduct predating a MOA as a basis for revoking a registration.'' Id. And he argues that ``[t]he MOA was a contract between DEA and [himself],'' that the MOA placed restrictions on his registration ``[i]n lieu of initiating procedures for the revocation of'' his registration, that he ``fulfilled his obligations under the'' MOA, and that ``DEA is bound by its agreement to accept the MOA in lieu of seeking revocation based on [his] 2000 conviction'' under ``[s]imple contract law.'' Id. at 11. I disagree. While the MOA noted that ``[i]n light of [his] past actions, authority exists under 21 U.S.C. [823(f) and 824a)(4)] for DEA to initiate Show Cause action to revoke [his ] registration'' and that ``[i]n lieu of initiating procedures for the revocation of [his] [r]egistration,'' the parties had agreed to various terms including the renewal of his registration, none of those terms precluded the Agency from relying on the state court convictions in any subsequent proceeding.\37\ RX 83, at 2. Thus, applying ``simple contract law,'' Respondent got exactly what he bargained for--the renewal of his registration subject to various conditions. What he did not bargain for was the ability to preclude the Agency from considering the state court convictions in the event he committed additional misconduct in the future and was subject to a Show Cause Order.\38\ --------------------------------------------------------------------------- \37\ Respondent might have an argument under ``simple contract law'' if, after the MOA expired (that being one year from the date that DEA signed the agreement), the Agency then brought a show cause proceeding based on the exact same grounds that led to the MOA and nothing else. But it has not. \38\ Respondent also argues that he ``has not found an Agency decision that relied on conduct predating a MOA as a basis for revoking a registration.'' Exceptions, at 10. However, in Mark De La Lama, 76 FR 20011 (2011), the Agency denied an application (submitted by a nurse practitioner who allowed his registration to expire) based, in part, on his prior convictions for controlled substance offenses which gave rise to an MOA when he first became registered and which he subsequently violated. See 76 FR at 20018 & n.15; id. at 20019 n.18. While the decision did not place substantial weight on the applicant's convictions due to their age, it did not hold that the Agency could not consider the convictions because they predated the MOA. See id. Moreover, Respondent cites no Agency decision which holds that following the entry of an MOA, the Agency is precluded from considering the conduct which gave rise to the MOA in a subsequent proceeding. --------------------------------------------------------------------------- I therefore reject Respondent's exceptions that I am precluded from considering Respondent's state court convictions by the MOA. However, in light of the fact that Respondent's convictions occurred 17 years ago and that there is no evidence that Respondent has been subsequently convicted of either a federal or state offense related to controlled substances (whether falling within the scope of Factor Three or Factor Five), I place only limited weight on the state court convictions. Summary of the Government's Prima Facie Case Given Respondent's knowledge that Mullen had fraudulently obtained controlled substance prescriptions/refills 82 times from January 21, 2008 through August 24, 2012, as well as his knowledge that Mullen had been convicted in state court of two counts of prescription fraud, I conclude that he has committed ``other conduct which may threaten the public health and safety'' when he failed to immediately terminate Mullen. 21 U.S.C. 823(f)(5). I further conclude that Respondent's convictions for the unlawful possession of various controlled substances provide limited support for the finding that Respondent has committed ``other conduct which may threaten public health or safety.'' Id. [[Page 28691]] As also found above, Respondent failed to comply with the CSA's requirement that he ``make a complete and accurate record of all stocks . . . on hand'' both when he first engaged in the dispensing of controlled substances as well as ``every second year thereafter.'' 21 U.S.C. 827(a)(1); 21 CFR 1304.11(a) & (c). He also violated the CSA by directing his office manager, who does not hold a registration, to administer controlled substances to those patients who were to undergo procedures when Respondent was not at his office. 21 U.S.C. 841(a); 18 U.S.C. 2. Both his failure to maintain proper records and his conduct in directing his office manager to administer controlled substances to patients is relevant in assessing Respondent's experience in dispensing controlled substances (Factor Two) and his compliance with applicable laws related to controlled substances (Factor Four). I therefore hold that the Government has met its prima facie burden of showing that Respondent ``has committed such acts as would render his registration . . . inconsistent with the public interest.'' 21 U.S.C. 824(a)(4). I further conclude that grounds exist to suspend or revoke Respondent's registration. Sanction Where, as here, the Government has established grounds to revoke a registration or deny an application, a respondent must then ``present[ ] sufficient mitigating evidence'' to show why he can be entrusted with a new registration. Samuel S. Jackson, 72 FR 23848, 23853 (2007) (quoting Leo R. Miller, 53 FR 21931, 21932 (1988)). `` `Moreover, because `past performance is the best predictor of future performance,' ALRA Labs, Inc. v. DEA, 54 F.3d 450, 452 (7th Cir. 1995), [DEA] has repeatedly held that where [a registrant] has committed acts inconsistent with the public interest, the [registrant] must accept responsibility for [his] actions and demonstrate that [he] will not engage in future misconduct.'' Jayam Krishna-Iyer, 74 FR 459, 463 (2009) (citing Medicine Shoppe, 73 FR 364, 387 (2008)); see also Jackson, 72 FR at 23853; John H. Kennedy, 71 FR 35705, 35709 (2006); Cuong Tron Tran, 63 FR 64280, 64283 (1998); Prince George Daniels, 60 FR 62884, 62887 (1995). Also, a registrant's candor during both an investigation and the hearing itself is an important factor to be considered in determining both whether he has accepted responsibility as well as the appropriate sanction. Michael S. Moore, 76 FR 45867, 45868 (2011); Robert F. Hunt, D.O., 75 FR 49995, 50004 (2010); see also Jeri Hassman, 75 FR 8194, 8236 (2010) (quoting Hoxie v. DEA, 419 F.3d 477, 483 (6th Cir. 2005) (``Candor during DEA investigations, regardless of the severity of the violations alleged, is considered by the DEA to be an important factor when assessing whether a physician's registration is consistent with the public interest[.]''). While a registrant must accept responsibility for his misconduct and demonstrate that he will not engage in future misconduct in order to establish that his continued registration is consistent with the public interest, DEA has repeatedly held that these are not the only factors that are relevant in determining the appropriate disposition of the matter. See, e.g., Joseph Gaudio, 74 FR 10083, 10094 (2009); Southwood Pharmaceuticals, Inc., 72 FR 36487, 36504 (2007). Obviously, the egregiousness and extent of a registrant's misconduct are significant factors in determining the appropriate sanction. See Jacobo Dreszer, 76 FR 19386, 19387-88 (2011) (explaining that a respondent can ``argue that even though the Government has made out a prima facie case, his conduct was not so egregious as to warrant revocation''); Paul H. Volkman, 73 FR 30630, 30644 (2008); see also Paul Weir Battershell, 76 FR 44359, 44369 (2011) (imposing six-month suspension, noting that the evidence was not limited to security and recordkeeping violations found at first inspection and ``manifested a disturbing pattern of indifference on the part of [r]espondent to his obligations as a registrant''); Gregory D. Owens, 74 FR 36751, 36757 n.22 (2009). So too, the Agency can consider the need to deter similar acts, both with respect to the respondent in a particular case and the community of registrants. See Gaudio, 74 FR at 10095 (quoting Southwood, 71 FR at 36503). Cf. McCarthy v. SEC, 406 F.3d 179, 188-89 (2d Cir. 2005) (upholding SEC's express adoption of ``deterrence, both specific and general, as a component in analyzing the remedial efficacy of sanctions''). Having considered the relevant facts and circumstances, I disagree with the ALJ's recommended sanction of a one year suspension which would not be effective for three months from the date of my Final Order and which would be stayed provided Respondent takes certain courses within that period. Instead, because I find Respondent's failure to immediately terminate Mullen upon determining that she had fraudulently obtained 82 prescriptions for herself is egregious misconduct, which clearly posed a threat to public health and safety, I am compelled to reject the ALJ's recommended sanction and conclude that the imposition of a substantial period of outright suspension is warranted.\39\ --------------------------------------------------------------------------- \39\ Because the ALJ rejected this allegation, he did not address the relevant facts and circumstances related to this misconduct. --------------------------------------------------------------------------- Notably, Respondent did not acknowledge his misconduct in retaining Mullen, and instead, justified his decision to retain her until a new insurance clerk was hired and trained because of his need to maintain his cash flow. Moreover, when confronted as to why he had retained Mullen even after he obtained the PMP report which listed 82 different prescriptions which she had fraudulently obtained, Respondent attempted to minimize the scope of her misconduct, testifying that he ``acted upon . . . the proportion of things that I knew. So it wasn't . . . what we're looking at in retrospective now with this huge situation. It was only with a handful of information that I had, less than a dozen.'' Tr. 426. It is true that there is no evidence that Mullen continued her criminal acts during the five week period before she was finally terminated. Had the Government produced such evidence, I would revoke Respondent's registration. While it is also true that Respondent moved the fax machine into a room to which Mullen did not have access, this does not mitigate Respondent's misconduct because the evidence shows that many of the fraudulent prescriptions (whether for Mullen personally or for her co-conspirators) were phoned in. Finally, I conclude that the Agency's interests in both specific and general deterrence also support a substantial period of outright suspension for this misconduct. As to specific deterrence, were Respondent to confront the same situation of a diverting employee in the future, he must know that there will be serious consequences for failing to act responsibly. Also, Respondent may confront different scenarios in which he is faced with the choice of placing his private interests over the public interest. As to the Agency's interests in general deterrence, the community of practitioner registrants must know that there will be substantial consequences for failing to promptly terminate employees who are diverting controlled substances.\40\ --------------------------------------------------------------------------- \40\ Respondent argues that I should consider his cooperation with law enforcement upon discovering the 2012 fraudulent refill request. Resp. Post-Hrng. Br. 67. However, as discussed above, I conclude that the other factors discussed above greatly outweigh his cooperation with the Detective's investigation. --------------------------------------------------------------------------- [[Page 28692]] Accordingly, based solely on Respondent's misconduct in retaining Mullen, I conclude that the factors relevant to this misconduct support the outright suspension of Respondent's registration for a period of one year. Moreover, I conclude that Respondent's failure to maintain complete and accurate inventories, as well as his misconduct in directing his unregistered office manager to administer controlled substances to patients, provide additional support for my conclusion that an outright suspension for one year is warranted. While Respondent's failure to establish an initial inventory occurred sometime ago, his failure to maintain a complete and accurate biennial inventory based on an actual physical count of the controlled substances he had on hand is far more recent. While Respondent testified that he kept the records as he did based on the guidance he received from the state inspector in the 2005 time frame, the requirements to take an actual physical count ``either as of the opening of business or as of the close of business on the inventory date'' and to indicate this ``on the inventory'' are clear on the regulation's face. And even if Respondent was given erroneous advice by the state inspector, Respondent is responsible for knowing what is required by DEA's regulations.\41\ Moreover, while in response to the DI's instructions Respondent started taking an actual count, the ALJ found that ``Respondent did not show remorse for his recordkeeping violations.'' R.D. 49. --------------------------------------------------------------------------- \41\ In his Recommended Decision, the ALJ discussed eight considerations that in his view, ``mitigate the egregious of the shortcomings of Respondent's controlled substance inventory.'' R.D. 50. However, several of these do not mitigate the violation. For example, the ALJ noted that ``Respondent kept a thorough and detailed perpetual inventory,'' that the DI was able to use the perpetual inventory to do an audit, and that ``there is no evidence that the Respondent's recordkeeping errors resulted in any diversion.'' Id. These do not mitigate the violation because the CSA and DEA regulations require that a registrant take an actual physical count of the controlled substances on hand, and an accurate actual count, as memorialized in either an initial or biennial inventory, is essential in conducting an accurate audit. Likewise, an accurate audit is essential in determining whether a registrant is maintaining complete and accurate records of both the controlled substances he receives and those he ``deliver[s] or otherwise dispose[s] of.'' 21 U.S.C. 827(a)(3). As for the ALJ's statement that there is no evidence that Respondent's recordkeeping errors resulted in diversion, generally, it is diversion that results in recordkeeping irregularities and not the other way around. As for the ALJ's observation that Respondent kept receipt records that ``showed the number of containers, the number of dosages in the containers, and the strength of the dosages,'' these records were prepared by Respondent's suppliers, see, e.g., RX 89, at 37-47; and Respondent is required to maintain these records under the CSA and DEA regulations. See 21 U.S.C. 827(a)(3); 21 CFR 1304.21(a); id. Sec. 1304.22(c). Moreover, because I hold that the violation is based on his failure to have a biennial inventory based on an actual count of the drugs on hand and not on the fact that his inventory did not list the number of containers, the number of units or volume of each container, and the drug strength, the fact that he had records showing this information for the various receipts does not mitigate the violation. --------------------------------------------------------------------------- As for his practice of directing his office manager to administer controlled substances to patients who were undergoing procedures when he was running late and not in the office, the ALJ also found that there were several factors that mitigate the egregiousness of these violations. According to the ALJ, these factors include that this happened only ``occasionally,'' that Respondent had previously determined what medications should be administered to the patient based on his assessment of the patient's needs, that there is no evidence that the drugs were diverted, and that Respondent had ceased this practice after a patient questioned it. R.D. 50-51. I do not take issue with the ALJ's conclusions that these factors mitigate the egregiousness of these violations. However, here again, the ALJ found that ``Respondent never acknowledged that [the office manager's] administration of controlled substances violated DEA regulations. . . . Respondent never showed remorse for aiding and abetting dispensations by a non-registrant. Rather, the Respondent denied that these actions were wrongful.'' Id. at 46. The ALJ thus concluded that ``Respondent has not accepted responsibility for his conduct, even though he discontinued these practices [and] . . . Respondent has not rebutted the Government's prima facie showing that the Respondent violated 21 U.S.C. [Sec. 841(a)].'' Id. I agree. Respondent's violations in failing to take a proper inventory and in directing his unregistered office manager to administer controlled substances, coupled with his failure to acknowledge his misconduct with respect to both violations, provide additional support for my decision to suspend Respondent's registration for a period of one year. As for the state court convictions, because they did not involve distribution to others and occurred 17 years ago, I give them only limited weight in my determination as to the appropriate sanction. Accordingly, I will order that Respondent's registration be suspended outright for a period of one year. While Respondent testified that he no longer uses controlled substances during his procedures, if, following termination of the suspension, he intends to resume administering and/or engaging in the direct dispensing of controlled substances, Respondent must provide evidence to the local DEA office that he has completed a course in controlled substance recordkeeping prior to doing so. If Respondent does not provide such evidence, his registration shall be restricted to prescribing controlled substances. Order Pursuant to the authority vested in me by 21 U.S.C. 824(a) as well as 21 CFR 0.100(b), I order that DEA Certificate of Registration No. BK0639279 issued to Peter F. Kelly, D.P.M., be, and it hereby is, suspended for a period of one year. I further order that upon termination of the suspension, said registration shall be restricted to prescribing controlled substances, until such date that Peter F. Kelly, D.P.M., provides evidence that he has completed a course in controlled substance prescribing. This Order is effective July 24, 2017. Dated: June 19, 2017. Chuck Rosenberg, Acting Administrator. [FR Doc. 2017-13158 Filed 6-22-17; 8:45 am] BILLING CODE 4410-09-P
![28676 Federal Register / Vol. 82, No. 120 / Friday, June 23, 2017 / Notices
D.
B. C.
A. Total hours
Number of Time per
Type of response (column B ×
responses response column C)
Pre-Application Sampling and Testing 43 CFR 3601.30 .............................................................................................. 10 30 minutes .... 5
Request for Sale Within a Community Pit or Common Use Area 43 CFR 3602.11 .................................................... 165 30 minutes .... 83
Request for Sale Not Within a Community Pit or Common Use Area 43 CFR 3602.11 .............................................. 100 30 minutes .... 50
Mining and Reclamation Plans (Simple) 43 CFR 3601.40 ............................................................................................ 240 2 hours ......... 480
Mining and Reclamation Plans (Complex) 43 CFR 3601.40 ........................................................................................ 25 30 hours ....... 750
Contract for the Sale of Mineral Materials 43 CFR subpart 3602 Form 3600–9 .......................................................... 265 30 minutes .... 133
Performance Bond 43 CFR 3602.14 ............................................................................................................................. 265 30 minutes .... 133
Report of Mineral Materials Mined or Removed 43 CFR 3602.29 ................................................................................ 1,400 1 hour 30 2,100
minutes.
Records Maintenance 43 CFR 3602.28 ........................................................................................................................ 1,400 1 hour 30 2,100
minutes.
Totals ...................................................................................................................................................................... 3,870 ....................... 5,834
Authorities Delaware Water Gap National electric transmission line across
The authorities for this action are the Recreation Area, 1978 River Road (Off approximately 4.3 miles of the National
Mineral Materials Act (30 U.S.C. 601– US209), Bushkill, PA 18324, telephone Recreation Area.
602) and the Paperwork Reduction Act (570) 426–2418. Dated: May 3, 2017.
(44 U.S.C. 3501—3521). SUPPLEMENTARY INFORMATION: Notice is Joshua R. Laird,
hereby given that, pursuant to 16 U.S.C. Acting Regional Director, Northeast Region.
Mark Purdy, 460o–2(b), the boundary of Delaware
Bureau of Land Management, Management [FR Doc. 2017–13154 Filed 6–22–17; 8:45 am]
Water Gap National Recreation Area is
Analyst. adjusted to include three parcels BILLING CODE 4312–52–P
[FR Doc. 2017–13153 Filed 6–22–17; 8:45 am] totaling 1,055.89 acres of land in Pike
BILLING CODE 4310–84–P County, Pennsylvania: 1,054.26 acres
(Tax Map Nos. 175.00–02–06, 176.00– DEPARTMENT OF JUSTICE
02–01 and 183.00–01–19) in Lehman
DEPARTMENT OF THE INTERIOR and Delaware Townships; and 0.47 acre Drug Enforcement Administration
(portion of Tax Map No. 113.00–01– [Docket No. 15–26]
National Park Service 05.004) and 1.16 acres (right-of-way
[NPS–NER–DEWA–22315; over a portion of Tax Map No. 113.00– Peter F. Kelly, D.P.M.; Decision and
PS.SDEWA0040.00.1] 01–05.003) in Milford Township. The Order
two parcels in Milford Township,
Boundary Adjustment at Delaware together with 35.39 acres of fee interest On July 10, 2015, the Deputy
Water Gap National Recreation Area already within the boundary (remaining Assistant Administrator, Office of
portion of Tax Map No. 113.00–01– Diversion Control, Drug Enforcement
AGENCY: National Park Service, Interior. Administration, issued an Order to
05.004, also known as Tract 12795 in
ACTION:Notification of boundary the National Recreation Area), are part Show Cause to Peter F. Kelly, D.P.M.
adjustment. of a single property that cannot be (Respondent), of Roanoke, Virginia. ALJ
SUMMARY: The boundary of Delaware subdivided. This boundary adjustment Ex. 1, at 1. The Show Cause Order
Water Gap National Recreation Area is is depicted on Map No. 620/137,770 proposed the revocation of
adjusted to include three parcels of land dated April, 2017. Respondent’s Certificate of Registration
totaling 1,055.89 acres of land, more or Specifically, 16 U.S.C. 460o–2(b) No. BK0639279, the denial of any
less. Fee simple interest in two parcels states that the Secretary of the Interior application to renew or modify his
and a right-of-way over the third parcel may make adjustments in the boundary registration, and the denial of any other
will be donated by the Conservation of the national recreation area by application for a DEA registration, on
Fund to the United States along with fee publication of the amended description the ground that he has committed acts
simple interest in 35.39 acres of other thereof in the Federal Register: which render his registration
land already within the boundary. Provided, that the area encompassed by ‘‘inconsistent with the public interest.’’
These properties are all located in Pike such revised boundary shall not exceed Id. (citing 21 U.S.C. 824(a)(4), 823(f)).
County, Pennsylvania. the acreage included within the detailed As to the jurisdictional basis for the
boundary first described in the Federal proceeding, the Show Cause Order
DATES: The effective date of this
Register on June 7, 1977 (42 FR 29071– alleged that Respondent is registered ‘‘as
boundary adjustment is June 23, 2017.
29103). This boundary adjustment does a practitioner in [s]chedules II–V,’’
ADDRESSES: The map depicting this not exceed the acreage of the detailed under the above registration number, at
boundary adjustment is available for boundary so described. The the address of 4106 Electric Road,
inspection at the following locations: Conservation Fund is in contract to Roanoke, Virginia. Id. The Show Cause
National Park Service, Land Resources
asabaliauskas on DSKBBXCHB2PROD with NOTICES
acquire the property in Lehman and Order alleged that Respondent’s
Program Center, Northeast Region, 200 Delaware Townships and owns the fee registration does not expire until
Chestnut Street, Philadelphia, parcel and right-of-way in Milford December 31, 2017. Id.
Pennsylvania 19106, and National Park Township (along with Tract 12795). The As to the substantive grounds for the
Service, Department of the Interior, Conservation Fund will convey all of proceeding, the Show Cause Order
1849 C Street NW., Washington, DC these properties, including Tract 12795, alleged that in June 2000, Respondent
20240. to the United States without cost to help was indicted in the Circuit Court for
FOR FURTHER INFORMATION CONTACT: mitigate the effects of the upgrade and Roanoke County, Virginia, on four
Superintendent John J. Donahue, expansion of the Susquehanna-Roseland felony counts of unlawful possession of
VerDate Sep<11>2014 19:21 Jun 22, 2017 Jkt 241001 PO 00000 Frm 00059 Fmt 4703 Sfmt 4703 E:\FR\FM\23JNN1.SGM 23JNN1](https://thefederalregister.org/doc/82_FR_28796/page/1.svg)
![Federal Register / Vol. 82, No. 120 / Friday, June 23, 2017 / Notices 28677
controlled substances which included finished form in each container.’’ Id. Two, Four and Five. The ALJ rejected
sufentanil, oxycodone, pethidine, and (citing 21 U.S.C. 827(a) & (b); 21 CFR the allegation that Respondent is
hydromorphone, as well as one 1304.11(e)(3) & (e)(1)(iii)(D)). The Order responsible for the misuse of his
misdemeanor count of marijuana then alleged that these ‘‘violations are registration by Ms. Mullen, holding that
possession. Id. The Order alleged that the same as, or similar to, [the] the Government was required to show
Respondent entered an Alford plea to recordkeeping violations previously that Respondent had entrusted his
the charges and was sentenced to found by the [S]tate as detailed in [the] registration to Mullen and had failed to
probation and a fine. Id. The Order February 3, 2005 Consent Order.’’ Id. produce any evidence that Respondent
further alleged that as a result of the The Show Cause Order also alleged had given his registration number to
criminal case, on December 12, 2002, that Respondent left controlled Mullen or that he had given her access
Respondent entered into a substances, which included to his registration whether expressly,
Memorandum of Agreement with DEA, hydrocodone, alprazolam, and impliedly, or negligently. Id. at 32–34.
and that on February 3, 2005, he entered diazepam, ‘‘out overnight in [his] office, The ALJ further found that there was no
into a Consent Order with the Virginia rather than ‘stored in a securely locked, ‘‘credible or substantial evidence
Board of Medicine for ‘‘recordkeeping substantially constructed cabinet’ as showing that . . . Respondent knew
and other controlled substance required by 21 CFR 1301.75(b).’’ Id. at about Mullen’s illegal activities prior to
violations,’’ which resulted in his being 2–3. The Order alleged that Respondent August 20, 2012.’’ Id. at 34. The ALJ
fined and his license being ‘‘placed on engaged in this practice so that his specifically rejected the Government’s
probation for twelve months.’’ Id. at 1– office manager, ‘‘who is not a DEA contention that ‘‘‘it is simply not
2. registrant, could dispense these drugs to believable that [Respondent] did not
Next, the Show Cause Order alleged patients prior to [his] arrival in the know of [Mullen’s] diversion,’’ finding
that ‘‘[f]rom approximately December office.’’ Id. at 3. The Order then alleged that ‘‘the evidence shows that no one,
2007 until approximately September that Respondent ‘‘aided and abetted the other than Mullen and her cohorts, was
2012, [Respondent’s] employee, Vickie unlawful distribution of controlled aware of Mullen’s activities.’’ Id. at 35.
Mullen, used [his] DEA registration substances,’’ because the office manager The ALJ also rejected the
number to call-in and/or fax-in 72 did not possess a DEA registration and Government’s contention that
prescriptions in her own name and dispensed controlled substances ‘‘in Respondent was put on notice that his
1[,]596 prescriptions in the names of [his] absence . . . in violation of 21 registration was being misused when, in
others for controlled substances totaling U.S.C. 822(a)(2) and 21 CFR 2008, he was contacted by a pharmacist
127,686 dosage units of hydrocodone 1301.11(a).’’ Id. (citing 21 U.S.C. 841(a) regarding two prescriptions that were
(then a [s]chedule III controlled and 18 U.S.C. 2). called-in under his name, and that
substance) and 5,370 dosage units of Following service of the Show Cause Respondent should have monitored
Ambien ([z]olpidem tartrate, a Order, Respondent, through his counsel, Mullen and his PMP report. Id. at 35.
[s]chedule IV controlled substance).’’ Id. requested a hearing on the allegations. The ALJ cited four reasons for rejecting
at 2. The Order alleged that ‘‘[t]hese ALJ Ex. 2. The matter was placed on the the Government’s argument, including:
prescriptions were not authorized by docket of the Office of Administrative (1) That a ‘‘fax did not contain any
you and were not for a legitimate Law Judges and was initially assigned to information that suggested that one of
medical purpose, but rather were Chief Administrative Law Judge John J. Respondent’s employees was involved’’
diverted by Ms. Mullen into illegitimate Mulrooney, II. However, on September and that the ‘‘prescription was not
channels, including for her own 22, 2015, the matter was reassigned to written for one of the Respondent’s
personal use and the personal use of her Administrative Law Judge (ALJ) Charles patients,’’ (2) that the Respondent was
son and numerous other individuals.’’ Wm. Dorman, who conducted further never informed that Mullen was
Id. The Order then alleged that pre-hearing procedures and an responsible for the prescriptions, (3)
Respondent is ‘‘responsible for the evidentiary hearing on January 12–13, that even the detective who ran the
misuse of [his] registration by [his] 2016, in Roanoke, Virginia. investigation did not check the PMP,
employees.’’ Id. (citations omitted). The On April 11, 2016, the ALJ issued his and 4) that ‘‘the Government presented
Order further alleged that Respondent Recommended Decision. With respect to no evidence that . . . Respondent
had ‘‘continued to employ Ms. Mullen Factor One, the ALJ found that the breached some duty by not monitoring
in [his] medical practice, even after Board’s 2005 Consent Order ‘‘is the only his PMP.’’ Id.
learning of her diversion, in violation of disciplinary action in the record’’ and The ALJ further rejected the
21 CFR 1301.92.’’ Id. that the Board terminated his probation Government’s contention that
The Show Cause Order further alleged one month early. R.D. 29. The ALJ Respondent violated 21 CFR 1301.92, by
that ‘‘[o]n July 10, 2013, DEA executed noted, however, that while possessing a continuing to employ Mullen even after
an Administrative Inspection Warrant state license is a necessary condition for he learned of her diversion. R.D. 37–38.
. . . at [Respondent’s] registered holding a DEA registration, it is not According to the ALJ, the regulation
location’’ and that the Agency found dispositive. As for Factor Three, the ALJ relied on by the Government ‘‘does not
that Respondent was in violation of found that while in 2000, Respondent require the immediate termination of an
several record-keeping requirements. Id. was convicted of possession of employee; it only requires that the
More specifically, the Order alleged that marijuana and other controlled employer immediately assess the
Respondent ‘‘failed to take’’ both initial substances, these were simple employee’s conduct to determine what
asabaliauskas on DSKBBXCHB2PROD with NOTICES
and biennial inventories of the possession offenses which did not employment actions to take against the
controlled substances at his registered involve the manufacture, distribution or employee.’’ R.D. 37. The ALJ found that
location. Id. (citing 21 U.S.C. 827(a) & dispensing of controlled substances and Respondent complied with the
(b); 21 CFR 1304.11(a) & (c)). The Order thus did not fall within Factor Three. Id. regulations because he told Mullen that
also alleged that Respondent violated at 29–30. The ALJ thus concluded that she would be retained ‘‘only until her
DEA regulations requiring that the ‘‘there is no evidence to consider replacement showed minimal
inventories list ‘‘the number of concerning Factor Three.’’ Id. at 30. proficiency,’’ he ‘‘began advertising
commercial containers’’ and the The ALJ then addressed the various [her] position the same week that he
‘‘number of units or volume of each allegations of misconduct under Factors discovered her diversion,’’ and
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‘‘promptly hired and began to train Next, the ALJ rejected the Respondent has not been convicted of
Mullen’s replacement.’’ Id. The ALJ also Government’s contention that any controlled substance offenses since
noted that ‘‘Respondent moved his fax Respondent violated 21 CFR 1301.75, 2000.’’ Id. at 47. The ALJ further
machine to a room with a deadbolt on which requires that controlled rejected Respondent’s contention that
the door, called local pharmacies to substances be stored ‘‘in a securely DEA was estopped from relying on the
alert them to Mullen’s actions, took locked, substantially constructed convictions because it subsequently
away Mullen’s keys to the office, and cabinet,’’ when he left the controlled entered into an MOA with Respondent.
monitored his DEA number on the PMP substances out overnight for his office Id. The ALJ also rejected Respondent’s
system.’’ Id. manager to administer to patients who contention that his possession of the
The ALJ further noted that Mullen were undergoing procedures the drugs did not actually violate federal
was ‘‘Respondent’s only insurance following morning. Id. at 44. The ALJ law because his home was a warehouse
secretary,’’ that ‘‘her position was specifically noted that the DEA which was exempt from registration
essential to the continued operation of regulation does not define the term under the Controlled Substances Act
. . . Respondent’s practice,’’ and while ‘‘cabinet,’’ but that the New College (CSA), reasoning that issue could not be
‘‘Respondent’s office manager was edition of the American Heritage re-litigated in this proceeding. Id.
competent to perform the duties of the Dictionary of the English Language Based on his findings of the
insurance secretary, she could not do so (1976) includes as one of the word’s recordkeeping violations, the aiding and
and also perform her various duties.’’ Id. definitions, ‘‘a small or private room set abetting of the office manager’s
at 38. According to the ALJ, ‘‘[f]or small aside for some specific activity.’’ Id. The unlawful distribution of controlled
businesses that depend on each ALJ noted that the room in which the substances, and the 2000 convictions,
employee performing essential business medications were kept was locked, that the ALJ concluded that the Government
functions, it is reasonable to expect that only the Respondent and his office had established ‘‘a prima facie case that
terminating an employee can be a manager had a key, that the room had . . . Respondent has acted in a manner
process rather than an instantaneous a steel reinforced door and steel that is inconsistent with the public
action.’’ Id. The ALJ thus concluded that doorframe with a deadbolt, that interest and that marginally supports
Respondent acted ‘‘[c]onsistent with the Respondent’s office was protected by a the sanction [revocation] that the
requirements of 21 CFR 1301.92’’ by security system, and that there was no Government requests.’’ Id. at 48.
taking ‘‘immediate action towards evidence that the room ‘‘was used for Turning to whether Respondent had
terminating Mullen’s employment any purpose other than to store rebutted the Government’s prima facie
because of her misconduct’’ and rejected controlled substances prior to 2014.’’ Id. case, the ALJ found that while
the allegation. Id. The ALJ thus concluded that the ‘‘Respondent acknowledged his three
With respect to the recordkeeping Government failed to prove the violations, [he] did not show remorse
allegations, the ALJ rejected violation. Id. for his actions’’ and that he had not
Respondent’s contention that he was not However, the ALJ found that the accepted responsibility. Id.
subject to the recordkeeping Government proved the allegation that While the ALJ found that Respondent
requirements of 21 U.S.C. 827(a), Respondent had aided and abetted the had not ‘‘rebut[ted] the Government’s
because he did not ‘‘regularly engage[] unlawful distribution of controlled prima facie showing that a sanction is
in the dispensing or administering of substances by having his office manager, appropriate,’’ he also concluded that the
controlled substances and charge[d] his who was not registered, administer egregiousness of Respondent’s
patients, either separately or together controlled substances to patients who misconduct was mitigated by various
with charges for other professional were to have procedures on days when circumstances. Id. at 50; see also id. at
services, for substances so dispense or he was late arriving at his office. Id. at 52. However, even taking ‘‘these matters
administered.’’ Id. at 39 (quoting 21 44–45. The ALJ specifically rejected into considerations,’’ the ALJ still found
U.S.C. 827(c)(1)(B)). Respondent’s argument that his office that ‘‘Respondent’s violations, in
Based on the findings of the 2005 manager was exempt from registration combination, are serious and raise
Virginia Board of Medicine Consent under 21 CFR 1301.22(a), because she concerns of whether his registration is
Order, the ALJ then found that the was an ‘‘agent or employee . . . acting consistent with the public interest.’’ Id.
Government had proved that in the usual course of . . . her . . . at 53. Continuing, the ALJ explained
Respondent failed to conduct an initial employment.’’ Id. at 45. Based on that ‘‘[i]n light of . . . Respondent’s
inventory. Id. at 40 (citing 21 U.S.C. Respondent’s testimony that the office failure to accept responsibility, the
827(a)(1)). He also found that the manager administered controlled record supports the conclusion that [his]
Government had proved that substances to patients ‘‘only on ‘limited registration should be suspended and
Respondent failed to conduct and occasions,’ ’’ the ALJ explained that he [he] should obtain training concerning
‘‘maintain[ ] a proper biennial was ‘‘find[ing] as a matter of fact that recordkeeping, as well as storage and
inventory’’ because his records did not [her] administration of controlled administration of controlled
contain an actual count of the controlled substances was described repeatedly as substances.’’ Id.
substances taken either at the beginning ‘occasional,’ which is the opposite of The ALJ thus recommended that
or close of business but rather ‘‘a ‘usual[,]’ ’’ and ‘‘[t]herefore, [section] Respondent’s registration be suspended
running balance of controlled 1301.22(a) does not apply.’’ Id. As to for a period of one year, to begin three
substances after dispensing.’’ Id. at 41 this violation, the ALJ also found that months from the effective date of the
asabaliauskas on DSKBBXCHB2PROD with NOTICES
(citing 21 CFR 1304.11(c)). The ALJ Respondent did not acknowledge his Decision and Order in this matter, and
further found that the inventories were misconduct. Id. at 46. that the suspension be stayed if during
not compliant because they did not Finally, the ALJ found that this period, Respondent completed
contain ‘‘the number of commercial Respondent’s 2000 state court courses in ‘‘controlled substance
containers of each controlled substance’’ convictions for unlawful possession of recordkeeping,’’ ‘‘control substance
and the ‘‘the number of units or volume various controlled substances could be storage,’’ and ‘‘the administration of
of each commercial container of considered under Factor Five. The ALJ controlled substances.’’ Id. The ALJ also
controlled substances.’’ Id. at 42 noted, however, that ‘‘these convictions recommended that if his proposed
(citations omitted). occurred over 15 years ago, and [that] suspension was stayed, that his
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registration be restricted to authorize one year, as well as the requirement that pursuant to the written plea agreement.
only the prescribing of controlled Respondent take a course in controlled Id. at 2. Thereafter, on October 30, 2000,
substances for a period of one year to substance recordkeeping if, following the Circuit Court sentenced him to
begin on the stay’s effective date. Id. termination of the suspension, he probation for a period of one year, the
And he further recommended that if the intends to resume either administering terms of which required him to perform
suspension is stayed, Respondent or engaging in the direct dispensing of 100 hours of community service, to
‘‘undergo an annual audit to ensure controlled substances. I make the forfeit his driver’s license for 30 months,
compliance with controlled substance following factual findings. to undergo drug abuse testing and
regulations . . . by an independent counseling, and to pay costs. Id. at 4; see
Findings of Fact
auditor hired by . . . Respondent, for also RX 83, at 1. Respondent
three years from the effective date of the Respondent’s License and Registration successfully completed probation and
stay[,]’’ with ‘‘[t]he first audit [to] be Status on October 31, 2001, the charges were
conducted no later than one year after Respondent is a board certified Doctor dismissed. GX 1, at 6; RX 83, at 1.
the effective date of the stay,’’ with the of Podiatric Medicine who is licensed Shortly after Respondent was
results to be forwarded to the local DEA by the Virginia Board of Medicine. GX sentenced, representatives of the DEA
office ‘‘within [10] business days after 2. At all times relevant to the events at notified him that his registration was
the audit.’’ Id. at 53–4. issue, Respondent maintained offices in subject to revocation based on the above
Respondent filed Exceptions to the Roanoke, Bedford, Radford, and Rocky proceeding; the letter also offered
Recommended Decision. Thereafter, the Mount, Virginia. RX 13, at 2. Respondent the opportunity to
record was forwarded to my Office for Respondent is also the holder of DEA voluntarily surrender his registration.
Final Agency Action. Certificate of Registration BK0639279, RX 83, at 1. Sometime thereafter,
Having considered the record in its pursuant to which he is authorized to Respondent’s attorney wrote a letter to
entirety, including Respondent’s dispense controlled substances in the DEA representatives informing them
Exceptions, I agree with the ALJ that the schedules II through V, as a practitioner, that he had successfully completed his
Government has failed to prove that at the registered address of 4106 Electric probation and that all of his drug tests
Respondent is liable either for Road, P.O. Box 20566, Roanoke, VA were negative and that his propensity
entrusting his registration to Ms. Mullen 24018. ALJ Ex. 8, at 15. Respondent’s for drug abuse risk was found to be
(his insurance clerk) or because he knew negligible. Id. On December 12, 2002,
registration does not expire until
or should have known of her criminal DEA agreed to renew his registration
December 31, 2017. Id.
misconduct prior to August 20, 2012. I subject to a Memorandum of Agreement
also agree with the ALJ that the The Prior Criminal and Administrative (MOA) which remained in effect for a
Government has failed to prove that Proceedings period of one year. Id. at 2.
Respondent violated 21 CFR 1301.75, on On September 13, 2000, Respondent On October 15, 2004, the Virginia
those occasions when he left controlled pled guilty in the Circuit Court of Board of Medicine notified Respondent
substances outside of the controlled Roanoke County Virginia to four felony that it would hold ‘‘an informal
substances safe but the drugs were left counts of possession of the controlled conference’’ to inquire into various
locked in the drug room. substances sufentanil, oxycodone (with allegations that he ‘‘violated certain
I further agree with the ALJ that acetaminophen), pethidine laws and regulations governing the
Respondent failed to conduct an initial (meperidine), and hydromorphone,1 as practice of podiatry in Virginia.’’ GX 2,
inventory and that he also failed to take at 1. The Board raised 19 different
well as a single misdemeanor count of
a proper biennial inventory because he allegations including, inter alia, that he
possession of marijuana. GX 1, at 1. The
did not actually count the drugs that violated Virginia law by: (1) Unlawfully
Circuit Court, while finding the
were on hand. In addition, I agree with possessing controlled substances based
evidence sufficient to convict
the ALJ that Respondent aided and on his Alford plea; (2) that prior to
Respondent, withheld adjudication
abetted a violation of 21 U.S.C. 841 February 15, 2001, he ‘‘failed to perform
when he directed his office manager to 1 Each of the felony counts involved a schedule an initial inventory, establish a biennial
administer controlled substances to II controlled substance. See 21 CFR inventory date, and failed to take an
patients prior to procedures when he 1308.12(b)(1)(vii) (hydromorphone); id. inventory of all [s]chedule II to V
was not present in the office. Finally, I § 1308.12(b)(1)(xiii) (oxycodone); id. controlled substances at least every two
agree with the ALJ that Respondent was § 1308.12(c)(18)(pethidine); id. § 1308.12(c)(27)
(sufentanil). Respondent maintained that the drugs
(2) years’’; and (3) that the inventory he
convicted in 2000 in state court of four (other than the marijuana) were both ‘‘expired and ‘‘performed on February 15, 2001 lacked
felony offenses and one misdemeanor existing medications’’ which he moved from his the time it was performed and the name
offense of unlawful possession of office to his house because, based on his drug of the individual who performed it.’’ 2 Id.
controlled substances. counts, some of the drugs were missing and while at 1–3.
he suspected one of his employees, he ‘‘didn’t
I disagree, however, with the ALJ’s really have any evidence to confront her and report On February 3, 2005, Respondent and
rejection of the Government’s this.’’ Tr. 383–84. However, Respondent asserted the Board entered into a Consent Order,
contention that Respondent should have that the pethidine ‘‘was left over from [his] ex- which found that Respondent had
immediately terminated Mullen after he wife’s . . . rhinoplasty procedure, and she doesn’t violated various provisions of Virginia
really take any narcotics, so she had some of these
determined that she had been calling left over.’’ Id. at 387. Respondent asserted that he law. The findings included ‘‘that he . . .
and faxing in fraudulent prescriptions entered the Alford plea because had he gone to trial, did not establish an initial inventory or
asabaliauskas on DSKBBXCHB2PROD with NOTICES
and refill requests for hydrocodone and ‘‘it would have made the front page [of the] paper maintain current and accurate records of
zolpidem. While I agree with the ALJ for the whole week’’ and ‘‘would have cost me all his inventory, receipt and distribution
my patients and reputation.’’ Id. at 388. Respondent
that Respondent did not acknowledge subsequently maintained that during the hearing on of controlled substances,’’ and that he
any of his misconduct, I disagree with his plea, the Commonwealth’s Attorney ‘‘was
his recommended sanction of a stayed unable to point to any specific violation of law.’’ Id. 2 Some of the other allegations included that he
suspension. Instead, I conclude that at 389–90. However, the Circuit Court’s orders administered expired controlled substances to his
identified the specific provisions of the Virginia patients, and that he dispensed schedule III and IV
relevant factors support the imposition Code violated by Respondent. See GX 1, at 1 (Trial controlled substances to patients for their ‘‘at home
of an outright suspension of Order citing Va. Code §§ 18.2–250 and 18.2- 250.1); use’’ ‘‘without a license from the Board of
Respondent’s registration for a period of id. at 3 (Sentencing Order citing same provisions). Pharmacy.’’ GX 2, at 1–2.
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‘‘did not provide for adequate storage substance). GX 12, at 1. According to the box with lines for printing the
for controlled substances maintained in credited testimony, at one Walmart ‘‘Prescriber’s Name,’’ the ‘‘Prescriber’s
his office.’’ GX 3, at 1–2. The Consent pharmacy, Mullen would call the DEA #,’’ as well as lines for the
Order further found that ‘‘since the pharmacy’s doctor’s line and leave a ‘‘Prescriber’s Signature’’—which was
Board brought these matters to his message for a prescription representing where Mullen would use Respondent’s
attention in July 2002, [Respondent] has that she was calling on behalf of signature stamp—and the ‘‘Date.’’ See
revised and updated his controlled Respondent. The Walmart pharmacy GX 8, at 5. Notably, a number of these
substance recordkeeping, storage and would fill the prescriptions even though forms included Respondent’s DEA
dispensing practice, and believes that he Mullen did not provide Respondent’s number which was hand-written in the
is fully compliant with all regulatory DEA registration number.4 Tr. 42. ‘‘Prescriber Comments’’ box. See GX 8,
requirements regarding controlled Instead, notwithstanding that DEA at 5, 7, 13, 15, 17, 19; GX 9, at 7, 13,
substances.’’ Id. at 4. regulations require that an oral 23, 29, 34, 38; GX 10, at 9, 15, 19.
Based on its findings, the Board prescription contain all of the Over the course of the scheme,
imposed a monetary penalty of $2,000 information mandated under 21 CFR Mullen called in or faxed in
and placed Respondent on probation for 1306.05, including the prescriber’s DEA prescriptions and refill requests for 82
a period of one year. Id. at 5. The Board registration number,5 the pharmacist prescriptions for herself which
further required that Respondent certify would retrieve Respondent’s registration Respondent had not authorized.8 Tr.
‘‘that he has read and agrees to fully number from the computer and put it on 106–07. On some occasions, she called
comply with Chapters 33 and 34 of the the call-in prescription form which the in prescriptions listing her son and a
Code of Virginia,’’ that he ‘‘successfully pharmacy would complete.6 Id. at 48. daughter-in-law as the patients. Id. at
complete [a] continuing education Mullen did not give her name as the 105. Moreover, Mullen’s son provided
course[] in recordkeeping,’’ and that person calling in the prescriptions; her with the names and dates of birth of
‘‘[w]ithin 60 days from the entry of [the] rather, she used such names as Virginia his co-workers, who agreed to pick up
Order,’’ he ‘‘submit to an inspection and Norvel, Liz Norville, and Liz Chilton. the prescriptions. Id. at 105–06. Mullen
audit by an Investigator of the See GX 6, at 2; GX 7, at 5, 7, 12, 14; Tr. also called in and or stamped refill
Department of Health Professions (DHP) 106. requests for 13 prescriptions for 90
to ensure that he is in compliance with On some occasions, the pharmacies dosage units of hydrocodone 10 mg,
record keeping, storage and dispensing would fax a refill request to with Respondent’s office manager listed
requirements.’’ Id. at 5–6. The Order Respondent’s office. On these occasions, as the patient. RX 36. In her testimony,
also provided that ‘‘[w]ithin 9 months Mullen would use Respondent’s Respondent’s office manager denied that
from the inspection and audit . . . signature stamp to manifest that he had she had received any of these
Respondent’s practice may be subject to approved the refill request and fax the prescriptions. Tr. 84.
an unannounced inspection by a’’ DHP authorization back to the pharmacy Between December 31, 2007 and
Investigator. Id. which typically authorized three refills. August 20, 2012, Mullen called in, or
On January 11, 2006, a Committee of See GX 7, at 9; GX 8, at 5, 7, 13, 15, 17, stamped and faxed, prescriptions and
the Board met to review Respondent’s 19; GX 9, at 7, 13, 23, 29, 34, 38; GX 10, refill requests for 1,596 prescriptions
compliance with the Consent Order and at 9, 15, 19. and refills for hydrocodone and
found that he ‘‘had fully complied with However, notwithstanding zolpidem. GX 12. In total, the
all terms [of] the Order.’’ GX 4, at 1. The Respondent’s claim that Mullen did not prescriptions resulted in the dispensing
Board thus terminated Respondent’s have access to his DEA number,7 the of 127,686 dosage units of hydrocodone
probation and restored his license to un- record contains numerous refill request and 5,370 dosage units of zolpidem
restricted status. Id. forms that suggest otherwise. These under Respondent’s registration.9 GX
The Diversion Occurring at forms include a ‘‘Prescriber Comments’’ 11, at 2.
Respondent’s Practice While Mullen was able to continue
4 According to the credited testimony of both her illegal activity for nearly five years,
Sometime in 2004, Respondent hired Respondent and his office manager, his DEA she came to the attention of the Virginia
Ms. Vicki Mullen to work at his registration was not posted and was kept in a file State Police as early as November 18,
Roanoke office, where her duties with his license in his office. Tr. 71, 319, 405. Also,
2008. GX 6, at 2. According to the
included preparing and filing insurance his signature stamp did not contain his registration
number. Id. at 80 & 405. Nor did Respondent’s evidence, on November 17, 2008,
claim forms. Tr. 73, 81. According to prescription blanks contain his DEA number. Id. at
Respondent’s office manager, Mullen 71; see also RX 16. Respondent did not, however, 8 While the testimony was to the effect that
was authorized to use Respondent’s keep his office door locked. Tr. 274. Mullen called in or faxed in 72 prescriptions for
5 The only exception is the prescriber’s signature.
signature stamp on the forms. Id. at 81. herself, the PMP report lists 82 prescriptions/refills.
21 CFR 1306.21(a). RX 24.
She also had access to the fax 6 On cross-examination, a Diversion Investigator 9 According to Detective Findley of the Virginia
machine.3 Id. at 408. provided testimony suggesting that pharmacies State Police Drug Diversion Unit, Mullen stated that
Beginning on or about December 31, ‘‘normally’’ fill oral prescriptions or called-in only ‘‘one pharmacy called [the] office to verify the
2007, Mullen began calling in prescriptions that are missing ‘‘the doctor’s DEA prescriptions,’’ and because Mullen ‘‘was there by
prescriptions to pharmacies for various number because it is already on file.’’ Tr. 148. herself and . . . took the phone call [she] obviously
Moreover, the record contains numerous told the pharmacist that it was fine, to go ahead and
drugs including 90 to 120 dosage units prescriptions that were reduced to writing by the fill’’ the prescription. Tr. 225. Detective Finley
of hydrocodone 10 mg (then a schedule pharmacist, but which were missing Respondent’s further testified that zolpidem is a sleep medication
III and now a schedule II controlled
asabaliauskas on DSKBBXCHB2PROD with NOTICES
DEA number. See GX 7. While in some instances, which is not usually prescribed by podiatrists and
substance) and 30 dosage units of the DEA number was written on the prescription, that the issuance of two to three monthly
the Government put forward no evidence that the prescriptions by a podiatrist should have been
zolpidem (the generic version of pharmacist had obtained Respondent’s DEA suspicious to a pharmacist and that it would be
Ambien, a schedule IV controlled number off the voice mail message left by Mullen unusual for a podiatrist to continue prescribing this
rather than through the pharmacy’s database. drug. Id. at 226–27. With respect to the
3 According to the testimony of Respondent’s 7 See Tr. 174–75 (Colloquy between Respondent’s hydrocodone prescriptions, Detective Finley agreed
office manager, Respondent saw patients once a counsel and DI regarding refill request form (GX 7, with Respondent’s counsel that ‘‘it would be
week at his Roanoke office; he also did surgeries at 9): ‘‘Q[.] And as faxed back from, allegedly from unusual for a podiatrist to maintain somebody on
once a week at the Roanoke office, however, he did the doctor’s office, it does not have a DEA number narcotic pain medication at the levels’’ of these
not do surgeries every week. Tr. 56. on it, does it?’’ A[.] No.’’). prescriptions. Id. at 227.
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Mullen called in two prescriptions for the individual who picked up one of the for 90 dosage units of hydrocodone 10
Tramadol, which although it was not prescriptions as M.F.,11 who has the mg on nine different occasions. See GX
then a federally-controlled substance, it same last name as S.F. RX 93–A. The 13, at 1. Indeed, Mullen’s criminal
was a controlled substance under Detective called M.F., who ‘‘admitted to conduct continued unabated even after
Virginia law, to a Walmart Pharmacy in picking up the forged prescriptions.’’ Id. she was indicted, and even after May
Christiansburg, Virginia. Id. Upon She also told the Detective that Vicki 27, 2009, when she pled guilty to two
reviewing the prescriptions, the Mullen had called in the prescriptions. counts of prescription fraud and was
pharmacist noted that they were issued Id., see also Tr. 191. offered probation for one year and a
by the same doctor (Respondent), for the Thereafter, on November 20, 2008, the deferred adjudication of the charges. See
same exact prescription to two patients Detective interviewed Mullen, who GX 14, at 3–4, 7–9; GX 12, at 9–49. At
(C.T. and S.F.), who, while they had admitted that she had called in the no point was Respondent notified that
different last names, had the same forged prescriptions. RX 93–A. While on Mullen had pled guilty to the charges,
address. Id. According to the February 6, 2009, Mullen was indicted and he was not otherwise notified of
pharmacist, the prescriptions were in state court on the charge that she Mullen’s conviction by ‘‘the parole [sic]
purportedly called in by Liz Norville. ‘‘did obtain or attempt to obtain system.’’ Tr. 428; see also id. at 357.13
Id. [Tramadol], by fraud, deceit, Mullen continued to work for
Finding the two prescriptions to be misrepresentation, embezzlement, or Respondent until late September 2012,
suspicious, the pharmacist called subterfuge, or by the concealment of a nearly five weeks after August 20, 2012,
Respondent’s office and was told that material fact,’’ which was punishable as when his office manager found a faxed
‘‘no one named Liz Norville . . . a Class 6 felony under Virginia law, at refill request from a Walmart Pharmacy
worked at that office [and] that they had no point did the Detective tell (#1301) for 90 dosage units of Lortab 10
no patients by the name of’’ C.T. and Respondent that Mullen had been mg for a patient named J.L. GX 15, at 2;
S.F. Id. Later that day, Respondent arrested.12 Tr. 214. see also RX 18; Tr. 342–43. According
called the pharmacist and confirmed The Detective further admitted that he to the office manager, she pulled a chart
that C.T. and S.F. were not his patients did not obtain a Prescription Monitoring for a patient with the same name and
and that ‘‘no one had called those in Program (PMP) report using determined that there was no such
from his office.’’ Id. Respondent also Respondent’s DEA registration number original prescription in the chart; she
faxed to the pharmacist a written to determine what controlled substance also determined that while the actual
statement, stating that ‘‘[n]either did my prescriptions were being dispensed and purported patient had the same
office nor I call in prescriptions for [C.T. under his registration. Id. at 210. He also names and address, they had different
or S.F.] at any time. They are not my did not obtain a PMP report showing the birthdates. Tr. 60. The office manager
patients.’’ GX 5, at 1. The next day, the prescriptions obtained by Ms. Mullen. showed the refill request to Respondent,
pharmacist reported the prescriptions to Id. at 212. While the Detective testified who determined that he did not write
Detective Larry Findley, who was that he did not remember the exact date the prescription. Id.; see also id. at 342.
assigned to the Drug Diversion Unit of Respondent then called the pharmacy.
on which the state police’s drug
the Virginia State Police.10 Tr. 189; RX GX 15, at 2; Tr. 343. The pharmacist
diversion agents were given access to
93–A. reviewed J.L.’s prescription history and
the PMP, he acknowledged that during
The same day, Detective Findley went told Respondent that J.L. had been
the period in which he was
to the pharmacy, interviewed the obtaining Lortab prescriptions/refills on
investigating the tramadol prescriptions,
pharmacist and obtained a written a monthly basis since May 17, 2011,
he probably had the ability to obtain a
statement from her, as well as the ‘‘when the original prescription was
PMP report of Respondent’s controlled
statement Respondent had provided to called in by’’ a person who gave Vicki
the pharmacist. GX 6, at 2; Tr. 189–90. substance prescriptions. Id. at 211–12. as her first name but a different last
Using video footage, the Detective, with While the Detective’s testimony also name than Mullen. GX 15, at 2; Tr. 348;
the assistance of one of the store’s asset suggests that he obtained a report from see also RX 27 (telephone prescription
protection officers, was able to identify the Walmart Pharmacy of the of May 17, 2011 with no DEA number);
prescriptions dispensed to the RX 28, at 1–4 (request for refills dated
10 On cross-examination, Respondent asserted individuals who were filling the forged 6/30/11 (four total refills), 11/22/11 (one
that he ‘‘didn’t think [the November 2008 incident] prescriptions, he did not ask the refill), 12/20/11 (four total refills), 4/10/
had anything to do with me. There was nothing to pharmacy to provide a report of Ms. 12 (four total refills). The pharmacist
link my employee with that at all.’’ Tr. 404. He then Mullen’s prescriptions. Id. at 212–13.
testified that he thought the incident was verified that the refill requests were
‘‘associated more with’’ a podiatrist who practiced Moreover, the Detective did not notify faxed to and from Respondent’s office.
in the Christiansburg, Virginia area and who had any other pharmacies to be on the GX 15, at 2; see also RX 28, at 1–4.
bought another practice in an area where there was lookout for potentially forged Respondent told the pharmacist ‘‘that
‘‘a large drug ring down there.’’ Id. at 404–05. prescriptions from Respondent’s office.
Respondent explained that ‘‘I addressed the issue somebody was fraudulently using [his]
as it was presented to me’’ and ‘‘I had [the office Id. at 214. DEA number.’’ Tr. 350. He also told the
manager] search our computer database and our Notably, by November 17, 2008,
current patient files.’’ Id. at 407. He further testified Mullen’s criminal conduct had already 13 During cross-examination by Respondent, the
that because the purported patients were not his resulted in the dispensing of 200 Detective was asked whether he recalled that during
patients he made no changes to his office practices Mullen’s plea hearing in federal court, the Court
and had ‘‘[n]o reason to’’ discuss the incident with prescriptions and refills, each being for
asked him if he was ‘‘convinced that [Respondent]
90 dosage units of hydrocodone, by
asabaliauskas on DSKBBXCHB2PROD with NOTICES
Mullen. Id. at 408. had no idea this was going on until it was brought
After Respondent acknowledged that Mullen had three Walmart Pharmacies. See GX 12, to [Respondent’s] attention by his ex-wife, if I
access to the fax machine and his signature stamp, at 1–7. And by this date, Mullen herself understand that,’’ and that he [the Detective] had
the Government asked him what measures he had answered, ‘‘Yes, sir.’’ Tr. 228. While the Detective
in place to supervise employees when he was in his
was able to fill a prescription or a refill
acknowledged his previous testimony, id., the
other offices. Id. at 408–09. Respondent asserted transcript of Mullen’s federal court plea hearing
11 The asset protection officer had worked at the
that ‘‘aside from recording all calls, and having was not made part of the record, and nothing in the
copies faxed to my email, I can’t think of any same Walmart in Salem, Virginia as had M.F. RX record of this proceeding establishes that
measure that wouldn’t be extreme, and quite 93–A. Respondent’s ex-wife brought ‘‘this’’ to
burdensome.’’ Id. He then acknowledged that he 12 Mullen was not arrested until February 20, Respondent’s attention, let alone when she may
took no such measures. Id. at 410. 2009, after she was indicted. Tr. 217. have done so.
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pharmacist ‘‘to block [his] DEA Respondent called Detective Findley; phone. And when asked by his counsel
number.’’ Id. Respondent the two met at Respondent’s Radford if Mullen would abide by ‘‘[t]he
acknowledged, however, that a couple office that afternoon. Id. at 347, 355. limitations [he] placed on her with what
of prescriptions were filled after this According to Respondent, Findley told she was doing,’’ Respondent answered:
conversation. Id. A spreadsheet him that ‘‘Vicki Mullen’s history ‘‘She didn’t indicate anything. She
compiled by the Government shows that extended beyond the falsified didn’t have much choice in the matter.’’
on August 29 and September 2, 2012, prescriptions mentioned above, to Id. at 363.
two refills, each being for 120 dosage include other stores, and other CIII Respondent also asserted that at the
units of hydrocodone, were filled by medications.’’ GX 15, at 2. Findley told time he decided to retain Mullen while
this same pharmacy. GX 12, at 49. The Respondent that Mullen had committed she trained her replacement he acted in
spreadsheet also shows that 10 other similar acts in 2008. Id. ‘‘proportion of things that I knew. So it
refills for 90 or 120 dosage units of Several days later, Respondent wasn’t . . . what we’re looking at in
hydrocodone were dispensed between accessed the Virginia Court System’s retrospective now with this huge
August 22 and September 15, 2012.14 Id. Web site and found the records of the situation. It was only with a handful of
However, the prescription numbers 2009 criminal case in which Mullen information that I had, less than a
support a finding that Mullen had either pled guilty to obtaining drugs by fraud. dozen.’’ Id. at 426. Yet, as found above,
called in or faxed back the fraudulent RX 23, at 1–6. He also ran a PMP report on August 24, 2012, Respondent ran a
authorization for each of these refills on Mullen. RX 24. The Report showed PMP report on Mullen’s prescriptions.
prior to August 20, 2012. Tr. 166; GX 12, that from January 21, 2008 through The report showed that between January
at 47–49. August 24, 2012, Mullen had obtained 21, 2008 and August 24, 2012, Mullen
Respondent further determined that 56 prescriptions/refills for 90 dosage herself had obtained 56 prescriptions for
only Mullen was working in his units of hydrocodone 10 mg and 26 90 hydrocodone 10 mg and 26
Roanoke office that afternoon as he and prescriptions/refills for 30 dosage units prescriptions for 30 tablets of zolpidem
his office manager had worked at his of zolpidem 10 mg which were 10 mg. RX 24. So too, Respondent
Radford office. GX 15, at 2. Respondent dispensed under Respondent’s testified that Mullen had given him
confronted Mullen over the phone who registration. Id. copies of two refill request forms, which
‘‘confessed to falsifying [his] signature, On August 24, 2012, Respondent had she had stamped with his signature and
submitting the refill authorizations, and Mullen prepare a written statement faxed back, which authorized the
picking them up.’’ Id.; Tr. 354. regarding her misconduct. See GX 16. In dispensing of four refills of
Respondent asked Mullen ‘‘how many the statement, Mullen listed the stores hydrocodone to J.B. (120 du) and R.H.
other people she used for the[] false she had used, including three Walmarts (90 du). RX 26; see also GX 12, at 26,
prescriptions’’; Mullen answered ‘‘about and three CVSs. Id. at 1. She also stated 48.
five.’’ GX 15, at 2; Tr. 355.15 that Respondent and his office manager Consistent with Mullen’s August 24,
Respondent called DEA and spoke ‘‘had no part or knowledge of my 2012 statement, both Respondent and
with a Diversion Investigator, who told activities.’’ Id. his office manager denied having any
him to call Detective Findley. Tr. 347. While Respondent told Mullen that knowledge of Mullen’s criminal activity,
she would be fired, and placed an ad for including the 2009 state proceeding,
14 Four of the refills were dispensed by a different her replacement, he retained her as an until late August 2012. Tr.75–76, 88
Walmart Pharmacy (#3243), three were dispensed at employee through September 28, 2012. (office manager’s testimony); id. at 355,
still another Walmart Pharmacy (#2312), one was See RX 49; Tr. 360. He testified that if 357, 381–82. (Respondent’s testimony).
filled at two different CVS pharmacies (#s 06285
and 03949), and another prescription was
he had another employee who could Respondent also disputed statements
dispensed at a Walgreens Pharmacy (#7604). GX 12, have done his insurance billing, Mullen made by Mullen in an unsworn
at 49. ‘‘would have been out the door ‘‘declaration’’ to the effect that he had
Respondent testified that he had called various immediately.’’ Tr. 362. He maintained knowledge of the 2008 diversion
pharmacies to report these incidents, but did not that he ‘‘could not operate’’ his practice incident and that both he and the office
‘‘exactly know when [he] did that,’’ before claiming
that he might have done this on August 20, 2012,
without his insurance clerk, that 99 manager knew ‘‘before 2012 that [she]
before he left for his Radford office. Tr. 359. percent of his cash flow came from was diverting drugs from his office.’’ GX
Respondent then explained that he notified one of insurance reimbursements, and that if 20, at 1 (Mullen declaration); Tr. 381–
the Walmarts that his ‘‘DEA number [wa]s being he had fired Mullen immediately, ‘‘we 82 (Respondent’s testimony).16 While
. . . falsified and abused’’ and that ‘‘should go to
all of the Walmarts’’ because ‘‘they’re going to be
would have had a backlog, and things the opening sentence of Mullen’s
on a network.’’ Id. at 360. He also stated that he had would have started trailing off in three declaration states that she was ‘‘duly
called ‘‘a handful of these’’ pharmacies, including weeks.’’ Id. at 361. He also asserted that sworn,’’ nothing else in the declaration
CVS and Walgreens, and that he knew it worked he had tried both ‘‘electronic billing’’ establishes that she appeared before a
because he subsequently received phone calls from
pharmacists questioning prescriptions. Id. As for
and ‘‘any number of substitutes,’’ but person authorized to administer oaths.
why the two prescriptions were filled at Walmart these measures had not ‘‘worked.’’ Id. at See GX 20, at 4 (signature page). Nor
#1301 even after he had informed this pharmacy 362. And he maintained that to prevent does the declaration contain an
that the refill authorization for J.L. was fraudulent, a re-occurrence of Mullen’s criminal attestation clause.17 See id.; see also 28
Respondent testified that he ‘‘figured the same thing
would happen with this Walmart 1301 also. So, I
activity, he had moved the fax machine U.S.C. 1746.
had no reason not to believe it would work.’’ Id. into the medication room, which had a
15 According to Respondent, sometime between steel door and frame with a deadbolt 16 Both the office manager and Respondent also
asabaliauskas on DSKBBXCHB2PROD with NOTICES
August 20 and 24, 2012, Mullen gave Respondent lock for which Mullen did not have a disputed Mullen’s statement in the 2015 declaration
three refill authorization forms which had been that Respondent ‘‘stood over me and at one point
key, and took away her office keys. Id. he leaned over me, grabbed my shoulder and shook
faxed to his office from Walmart Pharmacies #s
2312 and 3243. See RX 26. One of the requests, at 359, 421. me.’’ GX 20, at 3; Tr. 86 & 369.
which was dated March 13, 2012, was for Mullen Respondent further asserted that ‘‘I 17 On November 6, 2014, Mullen, along with her
herself and authorized the dispensing of four refills needed to isolate [Mullen] from any of son, were indicted on multiple counts of violating
of 30 Ambien 10 mg. Id. at 1. The other requests, these communications, to keep the 21 U.S.C. 841(a)(1) (unlawful distribution of
which were dated November 22, 2010 and August hydrocodone and zolpidem), 846 (conspiracy to
14, 2012, authorized the dispensing of four refills
office safe from her.’’ Id. at 362. Yet distribute hydrocodone and zolpidem), and
of 90 Lortab 10 mg to R.H. and four refills of 120 Respondent offered no testimony that 843(a)(3) (obtaining controlled substances by fraud),
Lortab 10 mg to J.B. Id. at 2–3. Mullen was denied access to the office and a single count of violating 21 U.S.C. 843(a)(2)
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Respondent further testified that he commercial containers.’’ Id. at 136. Regarding the recordkeeping
never authorized Mullen to call in However, on questioning by the ALJ as allegation, Respondent testified that
prescriptions for pain medications and/ to whether the beginning inventory DHP’s inspector who audited his
or controlled substances using his name would be ‘‘from the date that he opened records did not raise any issue with
and DEA number. Tr. 319. Indeed, he his practice or . . . from the date that respect to his recordkeeping and ‘‘said
asserted that Ms. Mullen ‘‘doesn’t know he received these particular drugs,’’ the they were good.’’ Id. at 397. Respondent
my DEA number.’’ Id. When asked DI explained that ‘‘[i]t would be from testified that based on his conversation
whether he ever authorized Mullen to the last biennial inventory. So he did with the inspector, he continued to
fax in refill prescriptions, Respondent have a biennial inventory. So that we maintain the records in ‘‘just the same
‘‘doubted that because whenever I gave can use that as a beginning way’’ until the DI advised him as to the
out prescriptions for any kind of pain inventory.’’ 19 Id. at 137. After ‘‘deficiencies he found.’’ Id. at 398.
medicine . . . I would give that to the acknowledging that a biennial inventory Respondent then testified that as a
patient directly. And then if [the is done ‘‘[e]very two years,’’ the DI result of his conversation with the DEA,
patient] needed a refill, I would refill it acknowledged that ‘‘we would use that he changed his recordkeeping practices
with the patient when I saw [him/her], biennial inventory or the initial ‘‘right away.’’ Id.
so that was directly handed to the inventory’’ as the ‘‘starting point.’’ Id. at The DI also testified that in the
patient.’’ Id. at 320. 137–38. summer of 2015, he interviewed
Asked whether he accepted However, upon questioning by Respondent’s office manager. Id. at 133.
responsibility for the ‘‘diversion that Government counsel, the DI testified In the interview, the office manager
occurred out of [his] office and under that there was no beginning inventory, denied any knowledge that
[his] identity,’’ Respondent answered that this is the same as the initial prescriptions were being called-in in her
that Mullen ‘‘was not entrusted with inventory which must be created when name. Id. She also told the DI that
[his] DEA number’’ and that ‘‘there was a person first becomes registered and Respondent was not ‘‘aware of that.’’ Id.
nothing I could do to supplement that.’’ obtains drugs, and that there was also The office manager also told the DI
Id. at 429. He further testified that when no biennial inventory. Id. at 138. Then that ‘‘sometimes the controlled
‘‘I found out about this, I acted asked if there were ‘‘any other substances, which would be
immediately,’’ and ‘‘as far as . . . acting regulation violations in terms of the [h]ydrocodone, Xanax, and [d]iazepam
in the public interest, I think I did that.’’ inventories that were required to be . . . would be left out for . . . her to
Id. Continuing, Respondent testified kept,’’ the DI answered: ‘‘No. Basically administer to the patient.’’ Id. at 134.
that ‘‘[a]s far as if you’re asking me if I he didn’t list the number of commercial The DI testified that the office manager
accept responsibility for all of her containers or how many dosage units is not a registrant and that she is not
diversion for the five years and so forth, were in each commercial container.’’ Id. permitted to administer controlled
I don’t know how I could do that.’’ Id. The DI also testified that he found it substances when Respondent is not
at 429–30. troubling that Respondent’s violations present because she is ‘‘not registered’’
‘‘were similar’’ to those found in the and ‘‘doesn’t have the training to handle
The DEA Administrative Inspection 2005 Consent Order, ‘‘especially about controlled substances.’’ Id. The DI also
and Investigation the biennial inventory and initial testified that leaving the controlled
On July 10, 2013, DEA Diversion inventory.’’ Id. at 140. The DI further substances out overnight is not
Investigators executed an asserted that Respondent’s permitted, and that under the Code of
Administrative Inspection Warrant recordkeeping violations ‘‘should have Federal Regulations, controlled
(AIW), presumably at Respondent’s been rectified . . . back in 2005,’’ and substances ‘‘have to be secured in a
Roanoke office as it was his registered that the records ‘‘should have been done substantial cabinet,’’ such as ‘‘a steel
location.18 RX 88, at 1; Tr. 135. In correctly . . . actually, ever since cabinet’’ or ‘‘a safe.’’ Id. Finally, the DI
testimony which was both confused and [Respondent] entered into the MOA asserted that Respondent did not
confusing, the DI stated that Respondent with DEA.’’ Id. at 141. maintain effective controls against
had various recordkeeping violations, The DI acknowledged, however, that diversion because he was not
which, in his view, included that the Respondent had receipt records that monitoring his employee closely
‘‘initial inventory wasn’t listed.’’ Tr. went back beyond the period of the enough, id. at 142, and that Respondent
135–36. The DI then asserted that while audit he conducted, which covered a ‘‘has an obligation to know about any
Respondent ‘‘had a dispensing log and period of two years. Id. at 161, 163. The diversion that happens with his
it did have the number of pills that was DI also conceded that Respondent could employees or any criminal
dispensed each time and a running account for nearly every pill he had information.’’ Id. at 144. However, when
count . . . DEA requires a beginning obtained, the exception being that he asked by Government counsel if there
inventory, which would actually . . . be was off three pills of hydrocodone 10/ were ‘‘[a]ny other controls that
the drug strength, the number of 650 mg. Id. at 162–63. [Respondent] should have been using,’’
commercial containers or the size of the the DI answered: ‘‘I don’t believe so.’’
19 The CSA does not use the term ‘‘beginning
Id.
inventory.’’ See 21 U.S.C. 827(a)(1). Rather, it uses The DI conceded that Respondent no
(use of a DEA registration number issued to the term ‘‘initial inventory’’ to describe the
another). GX 20, at 132–40. Mullen pled guilty to requirement that ‘‘every registrant . . . shall . . . as
longer has controlled substances in his
all six counts, and on July 17, 2015, she was soon thereafter as such registrant first engages in the office. Id. at 165–66. He also
asabaliauskas on DSKBBXCHB2PROD with NOTICES
sentenced to 18 months incarceration. Id. at 156– manufacture, distribution, or dispensing of acknowledged that he had looked at
158. controlled substances . . . make a complete and
18 The Government did not submit the AIW for
Respondent’s prescriptions since 2013,
accurate record of all stocks thereof on hand[.]’’ Id.
the record and the DI did not testify to the exact While the CSA also requires a registrant who and that none of these prescriptions
date on which the AIW was executed. Tr. 135. I engages in the dispensing of controlled substances raised any concern. Id. at 166.
thus derive the date of the inspection from the to take an inventory ‘‘every second year thereafter,’’ As to the allegation that he did not
closing inventory document, which was submitted the statute calls this inventory a ‘‘biennial provide adequate security for the
by Respondent. RX 88. Even though the Show inventory.’’ See id. The term ‘‘beginning inventory’’
Cause Order alleged that various other records did simply refers to an inventory that is used as the
controlled substances that he left out of
not comply with the CSA and DEA regulations, the starting point for an audit of a registrant’s handling the safe the night before he would
Government did not submit these either. of controlled substances. perform procedures, Respondent
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testified that his office was in ‘‘a several times but ‘‘couldn’t get a log-in.’’ Volkman, 567 F.3d at 222); see also
freestanding building,’’ that it was the Id.; see also id. at 366–67. Respondent Hoxie, 419 F.3d at 482.20
only office in the building, that he had then testified that he later found out Under the Agency’s regulation, ‘‘[a]t
a security system that had motion and ‘‘that the site had been hacked . . . in any hearing for the revocation or
door detectors that was monitored, that 2009’’ but did not remember when he suspension of a registration, the
the door and door frame to the drug had tried to access the PMP. Id. at 367 Administration shall have the burden of
room were made of steel, and that the & 435. Nor did he testify as to why he proving [by substantial evidence] that
door had a deadbolt lock. Id. at 305–10. had previously sought to access the the requirements for such revocation or
He further testified that Ms. Mullen did PMP. However, Respondent testified suspension pursuant to . . . 21 U.S.C.
not have a key to the room. Id. at 308. that he now monitors the state PMP [§ ] 824(a) . . . are satisfied.’’ 21 CFR
As for his practice of allowing his every month to determine if someone is 1301.44(e). In this matter, I conclude
office manager to administer controlled misusing his registration. Id. at 382. that the Government’s evidence with
substances to patients prior to respect to Factors Two, Four, and Five 21
procedures, Respondent testified that Discussion supports the conclusion that
this ‘‘was not a routine practice’’ and Under the CSA, ‘‘[a] registration Respondent has committed acts which
occurred only ‘‘on occasion.’’ Id. at 336. pursuant to section 823 of this title to render his ‘‘registration inconsistent
Respondent added that this would occur manufacture, distribute, or dispense a
if he was ‘‘inevitably going to be late, controlled substance . . . may be 20 In short, this is not a contest in which score
right when the patient starts . . . is kept; the Agency is not required to mechanically
suspended or revoked by the Attorney count up the factors and determine how many favor
complaining about that,’’ prompting a General upon a finding that the the Government and how many favor the registrant/
call from his office manager ‘‘asking[] if registrant . . . has committed such acts applicant. Rather, it is an inquiry which focuses on
she [could] administer. . . the as would render his registration under protecting the public interest; what matters is the
medicines.’’ Id. at 337. Respondent seriousness of the registrant’s or applicant’s
section 823 of this title inconsistent misconduct. Jayam Krishna-Iyer, 74 FR 459, 462
explained that his office manager ‘‘had with the public interest as determined (2009). Accordingly, as the Tenth Circuit has
already checked the [patient’s] vitals,’’ under such section.’’ 21 U.S.C. recognized, findings under a single factor can
and that he ‘‘would either say yes or no 824(a)(4). So too, ‘‘[t]he Attorney support the revocation of a registration. MacKay,
about that.’’ Id. He also testified that he 664 F.3d at 821. Likewise, findings under a single
General may deny an application for [a factor can support the denial of an application.
did procedures only one day a week, practitioner’s] registration . . . if the 21 With respect to Factor One, the Virginia Board
and that it ‘‘would only be the first case Attorney General determines that the has not made a recommendation to the Agency in
in the morning, if that happened at all.’’ issuance of such registration . . . would this matter. Moreover, even under the broader view
Id. be inconsistent with the public taken in numerous agency cases of what constitutes
While Respondent testified that he relevant evidence under this factor, the Virginia
interest.’’ Id. § 823(f). In the case of a Board’s 2005 restoration of Respondent’s medical
would leave drugs outside of the safe (in practitioner, see id. § 802(21), Congress license to unrestricted status is of de minimis
the storage room) either the night before has directed the Attorney General to probative value in assessing whether his continued
the procedure or if he had ‘‘come in consider the following factors in making registration is consistent with the public interest
earlier in the morning,’’ he further given that the most serious allegations in this matter
the public interest determination: post-date the Board’s action. Thus, the most that
explained that he would leave out only can be said for the Board’s restoration of his
the aliquot for ‘‘just that one patient,’’ (1) The recommendation of the appropriate
medical license to unrestricted status is that
and that it was kept ‘‘behind the locked State licensing board or professional Respondent currently possesses authority to
disciplinary authority. dispense controlled substances under Virginia law
door’’ of the drug room. Id. at 338–39. (2) The applicant’s experience in and therefore meets the CSA’s prerequisite for
According to Respondent, opening the dispensing or conducting research with maintaining a practitioner’s registration. See
safe required both a key and a respect to controlled substances. Frederic Marsh Blanton, 43 FR 27616 (1978) (‘‘State
combination, but only he knew the (3) The applicant’s conviction record under authorization to dispense or otherwise handle
combination. Id. at 340. Respondent Federal or State laws relating to the controlled substances is a prerequisite to the
stated that he had ended the practice of manufacture, distribution, or dispensing of issuance and maintenance of a Federal controlled
substances registration.’’) However, this finding is
allowing his office manager to controlled substances. not dispositive of the public interest inquiry. See
administer medication in September (4) Compliance with applicable State, Mortimer Levin, 57 FR 8680, 8681 (1992) (‘‘[T]he
2013, after a patient questioned the Federal, or local laws relating to controlled Controlled Substances Act requires that the
practice. Id. at 341. substances. Administrator . . . make an independent
Asked by the ALJ whether he thought (5) Such other conduct which may threaten determination [from that made by state officials] as
the public health and safety. to whether the granting of controlled substance
‘‘it was improper to have [his office Id. § 823(f). privileges would be in the public interest.’’); see
manager] administer’’ controlled also Paul Weir Battershell, 76 FR 44359, 44366
substances to patients when he was ‘‘not ‘‘[T]hese factors are . . . considered (2011) (citing Edmund Chein, 72 FR 6580, 6590
in the disjunctive.’’ Robert A. Leslie, (2007), pet. for rev. denied, Chein v. DEA, 533 F.3d
in the office,’’ Respondent maintained 828 (D.C. Cir. 2008)).
that he ‘‘thought it was a common M.D., 68 FR 15227, 15230 (2003). It is
As to Factor Three, I agree with the ALJ that there
practice.’’ Id. at 431. He then well settled that I ‘‘may rely on any one is no evidence that Respondent has been convicted
maintained that ‘‘my interpretation of or a combination of factors, and may of an offense under either federal or state law
the state code and publications by the give each factor the weight [I] deem[] ‘‘relating to the manufacture, distribution or
appropriate in determining whether’’ to dispensing of controlled substances,’’ 21 U.S.C.
Board of Medicine, it seemed like it was 823(f)(3), and that the simple possession offenses of
all right.’’ Id. However, Respondent suspend or revoke an existing which he has been convicted are properly
registration or deny an application. Id.;
asabaliauskas on DSKBBXCHB2PROD with NOTICES
provided no such materials to considered under Factor Five. The Agency has
corroborate that this practice complied see also MacKay v. DEA, 664 F.3d 808, recognized, however, there are a number of reasons
816 (10th Cir. 2011); Volkman v. DEA, why even a person who has engaged in criminal
with state law. misconduct may never have been convicted of an
Asked by the ALJ when he first 567 F.3d 215, 222 (6th Cir. 2009); Hoxie offense under this factor, let alone prosecuted for
started using the PMP, Respondent v. DEA, 419 F.3d 477, 482 (6th Cir. one. Dewey C. MacKay, 75 FR 49956, 49973 (2010),
testified: ‘‘August 24, 2012.’’ Id.at 435. 2005). Moreover, while I am required to pet. for rev. denied, MacKay v. DEA, 664 F.3d 808
consider each of the factors, I ‘‘need not (10th Cir. 2011). Thus, ‘‘the absence of such a
When then asked by the ALJ why he conviction is of considerably less consequence in
didn’t ‘‘use it prior to that time,’’ make explicit findings as to each one.’’ the public interest inquiry’’ and is therefore not
Respondent asserted that he had tried MacKay, 664 F.3d at 816 (quoting dispositive. Id.
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with the public interest.’’ 21 U.S.C. First, the ALJ’s opinion suggests that with a registrant’s obligation to ‘provide
823(f), 824(a)(4). While I agree with the he gave weight to Respondent’s effective controls and procedures to
ALJ’s conclusion that a sanction is testimony that he did not believe that guard against theft and diversion of
appropriate, I find that the record the 2008 incident had anything to do controlled substances,’ every registrant
supports a stronger sanction than that with him. See R.D. 35. Specifically, in has a duty to conduct a reasonable
recommended by the ALJ. rejecting the Government’s contention investigation upon receiving credible
that ‘‘Respondent should have information to suspect that a theft or
Factors Two, Four and Five— monitored Mullen and his PMP report, diversion had occurred.’’ Rose Mary
Respondent’s Experience in Dispensing the ALJ reasoned, in part, that ‘‘the 2008 Jacinta Lewis, 72 FR 4035, 4042 (2007)
Controlled Substances, Compliance fax 22 did not contain any information (quoting 21 CFR 1301.71(a)). Thus, the
with Applicable Laws Related to that suggested that one of Respondent’s Government is not required to show that
Controlled Substances, and Such Other employees was involved’’ and that ‘‘the a registrant either had actual knowledge
Conduct Which May Threaten Public refill prescription was not written for of, or was willfully blind to, an
Health and Safety one of the Respondent’s patients.’’ Id. employee’s or agent’s criminal
Respondent’s Liability for Mullen’s As for Respondent’s contention that behavior.25
Misuse of His Registration he did not believe the incident involved The Agency has further explained that
him, the incident obviously involved ‘‘the precise scope of’’ the duty to
In the Show Cause Order, the
him because his name was being used investigate ‘‘necessarily depends upon
Government alleged that Respondent is
as the purported issuer of the the facts and circumstances.’’ Id.
‘‘responsible for the misuse of [his]
prescriptions. Moreover, neither Moreover, a registrant’s duty to
registration by’’ Ms. Mullen. ALJ Ex. 1,
Respondent nor the ALJ explained why investigate potential theft or diversion
at 2. Moreover, in its post-hearing brief,
one would reasonably expect an by his employees (or agents) applies to
the Government asserts that Respondent
employee who was engaged in criminal all such acts, regardless of whether the
‘‘knew or should have known about the
activity by calling in fraudulent employee has been entrusted with
diversion that Ms. Mullen was
prescriptions to give her actual name. authority to use his registration. Cf. John
committing under his name’’ based on
Indeed, with respect to the person who V. Scalera, 78 FR 12092 (2013). In
the fraudulent tramadol prescriptions
was calling in the prescriptions, there Scalera, the former Administrator
that were brought to his attention by a
were only two possibilities: either the denied a physician’s application for
pharmacist in November 2008. Gov.
prescriptions were being called in by registration, based, in part, on his
Post-Hrng. Br. 15–16. The Government
someone who did not work for him or testimony that he ‘‘had no idea’’ and did
notes Respondent’s testimony that he
by someone who did.23 The record does not ‘‘know anything about’’ how
‘‘didn’t think [these acts of diversion]
not, however, establish whether the unlawful prescriptions that were issued
had anything to do with him,’’ even
pharmacist told Respondent that ‘‘Liz under his name as the prescriber were
though the prescriptions were called in
Norville’’ (Mullen) had provided either called-in or faxed to the
under his name, and argues that ‘‘he
Respondent’s phone number in the pharmacies. Id. at 12095–96; see also id.
admitted [that] he made no changes in
voice mail message that she left for the at 12099. The Administrator further
his office practices, did not discuss the
prescription. noted the physician’s testimony that
situation with his employees and did I agree with the ALJ that the
not begin to use Virginia’s PMP to ‘‘there was not enough evidence to
Government did not prove that convince him that any of his employees
monitor the drugs being prescribed Respondent either had actual
under his’’ registration. Id. at 16–17. had actually called in the prescriptions
knowledge of, or was willfully blind to, with his surrendered number.’’ Id. at
The Government then argues that the Mullen’s criminal behavior until August
Agency has consistently applied the 12097; see also id. at 12099. Notably,
20, 2012.24 R.D. 35–36. However, DEA the former Administrator denied the
principle ‘‘that a registrant bears has previously held that ‘‘[c]onsistent
responsibility for the misuse of their physician’s application notwithstanding
[sic] registration . . . by an employee.’’ 22 While there was a 2008 fax, this document was
that there was no showing that the
Id. at 17. Also pointing to the generated by Respondent in response to the call
physician had entrusted his registration
‘‘testimony’’ it presented in the form of from the pharmacist questioning the prescriptions, to any employee,26 holding that
Ms. Mullen’s unattested declaration, the which were phoned-in. ‘‘[h]aving failed to explain why the . . .
Government argues that Respondent
23 I acknowledge the possibility that someone
prescriptions were called in,
outside of a physician’s practice could call-in (or [r]espondent has offered no credible
entrusted his registration to Ms. Mullen fax-in) a fraudulent prescription to a pharmacy.
because her ‘‘duties also included Thus, obtaining the phone number provided by the assurance that similar acts will not
occasionally calling-in patient caller (or the number used to fax the prescription) occur in the future’’). Id. at 12100.
prescriptions to pharmacies.’’ Id. at 20. would tend to eliminate one of the two possible Nonetheless, the Agency has not
sources of the prescription’s origin. There is, previously held that the potential
The ALJ rejected the allegation, however, no evidence that the pharmacist told
reasoning that the Government did not Respondent that ‘‘Liz Norville,’’ the name Mullen misuse by an employee or agent of a
prove that Respondent ‘‘provide[d] used on this occasion, had provided his office
phone number when she called in the prescriptions, 25 The Government did not explicitly cite this
Mullen with access to his registration
or whether the pharmacy had obtained duty or Jacinta Lewis in the Show Cause Order, its
number expressly, impliedly, or Respondent’s phone number from its dispensing Pre-Hearing Statements, or its Post-Hearing brief.
negligently,’’ R.D. 34, or that software. Because I reject the Government’s contentions as to
asabaliauskas on DSKBBXCHB2PROD with NOTICES
Respondent either had knowledge or 24 As noted previously, in support of its the steps Respondent should have taken but did not
was willfully blind to Mullen’s actions contention that Respondent authorized Mullen to following the 2008 incident, I need not decide
use his registration and was also aware that she was whether the Government failed to provide adequate
prior to August 20, 2012. Id. at 35. diverting controlled substances, the Government notice of its intent to rely on this duty in this
While I agree with the ALJ that the produced an unattested declaration by Ms. Mullen. matter.
Government’s proof was inadequate to Notwithstanding that some of the statements made 26 In Scalera, the physician had previously
support the imposition of liability for by Mullen in this document are corroborated by surrendered his registration. 78 FR at 12094. While
other evidence, the Government’s failure to ensure the physician testified that office employees had
entrusting his registration to Mullen, I that Ms. Mullen attested to the truth of her access to his registration number, there was no
disagree with substantial aspects of the statements under penalty of perjury renders this showing by the Government that the physician had
ALJ’s reasoning. document inherently unreliable. authorized the employees to call in prescriptions.
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practitioner’s state prescribing authority Laws Ch. 739(H.B. 1704) (Amending Va. officers and pharmacists, failed to carry
to divert a non-federally controlled drug Code § 54.1–2523.C by authorizing the out those responsibilities.
triggers the duty to investigate whether Director to disclose, ‘‘in his discretion,’’ In conclusion, I agree with the ALJ’s
his DEA registration has also been ‘‘.8 Information relating to prescriptions legal conclusion that on this record, the
misused. I now hold that where a for covered substances issued by a Government has not sustained the
registrant is provided with credible specific prescriber, which have been allegation that Respondent is liable for
information that his state prescribing dispensed and reported to the program, Mullen’s criminal misconduct.
authority is being used to divert a state- to that prescriber.’’). However, regardless of whether a
controlled (but not federally-controlled) Nonetheless, where a practitioner registrant has entrusted his registration
drug, such information triggers the duty to an employee, upon receiving credible
receives credible information that
to investigate whether his DEA information that his registration may be
fraudulent prescriptions under his name
registration is also being used to divert the subject of misuse, a registrant has a
are being presented for state but not
federally controlled substances. duty to conduct a reasonable
federally-controlled drugs, and the state
However, as this is a new and additional investigation to determine whether his
PMP permits a practitioner to obtain
duty beyond that which was announced employees are involved in the misuse of
information as to his controlled
in Jacinta Lewis, which applies only to his registration. A failure to do so
substance prescribings, that practitioner
a practitioner’s receipt of information constitutes ‘‘other conduct which may
has a duty to obtain that information
that his DEA registration is being threaten the public health and safety.’’
and to determine whether unlawful
misused, I conclude that it cannot be 21 U.S.C. 823(f)(5).
prescriptions for federally controlled To establish a violation of this duty,
retroactively imposed on Respondent.
Moreover, even if the duty had been substances are also being dispensed the Government is not required to prove
announced prior to the 2008 incident, I under his registration. Moreover, even if that the registrant had actual knowledge
would find unpersuasive the state law does not authorize a or was willfully blind to the fact that an
Government’s contention that practitioner to obtain a PMP report of employee was engaged in diversion.
Respondent should be held liable the dispensings which have been Rather, the Government is required to
because ‘‘he made no changes in his attributed to him, a practitioner is show only that the registrant received
office practices, did not discuss the obligated to obtain that information credible information creating a
situation with his employees and did from a pharmacy that reports a suspicion that his registration was being
not begin to use Virginia’s PMP to fraudulent prescription to him. If misused, that reasonable measures were
monitor the drugs being prescribed information obtained from either the available to the registrant to determine
under his DEA number.’’ Gov. Post- PMP or a pharmacy shows that one’s if his/her employee or agent was
Hrng. Br., at 16–17. See also id. at 21 registration is being misused, a misusing his registration, and that the
(arguing that ‘‘[e]ven assuming . . . that registrant must report that information registrant failed to take such measures.
[Respondent] did not know of Ms. to DEA (as well as local law
enforcement authorities) even if the Respondent’s Continued Employment of
Mullen’s diversion, his failure to Mullen After He Became Aware of Her
discover it over a five-year period and practitioner concludes that no employee
or agent is involved in the misuse of his Criminal Conduct
his failure to properly monitor Ms.
Mullen or to even check his own PMP registration.28 A practitioner is not As found above, even after Mullen
report demonstrates a gross and reckless excused from this duty because others, admitted to Respondent that she had
disregard for his responsibilities as a who also have responsibilities to submitted the fraudulent refill
registrant and for the public health and investigate, such as law enforcement authorization for hydrocodone and he
safety’’). was told by Detective Findley that
The Government offered no year period and his failure to properly monitor’’ her Mullen had a history of submitting
explanation as to what changes ‘‘demonstrates a gross and reckless disregard for his fraudulent prescriptions which
responsibility as a registrant.’’ Notably, the included the 2008 tramadol
Respondent should have made to his Government does not explain by what method
office practices (other than to check his Respondent should have discovered Mullen’s prescriptions, Respondent continued to
PMP report) or other steps he should diversion when the state police detective employ Mullen. Indeed, within days of
have taken ‘‘to properly monitor Ms. acknowledged that he did not tell Respondent about receiving this information, Respondent
Mullen’s 2008 arrest and the subsequent found the state court records showing
Mullen.’’ As for its claim that convictions until the August 2012 incidents, and
Respondent did not discuss the only a single pharmacy questioned the dosing of a that Mullen had pled guilty to obtaining
situation with his employees, while prescription (but not its legitimacy) after the 2008 prescription drugs by fraud. He also
there is evidence that he did not discuss incident. obtained a PMP report showing that
Given the scope of the diversion, there is much from January 21, 2008 through August
the matter with Mullen, perhaps Mullen about this case (such as the failure of the detective
would have confessed and perhaps not. to tell Respondent of Mullen’s arrest and
24, 2012, Mullen had filled 56
Thus, it is unclear what this would have convictions, not to mention that the terms of her prescriptions/refills for 90 dosage units
accomplished. Finally, as for the probation did not prohibit her from working in a of hydrocodone 10 mg and 26
doctor’s office; the fact that prescriptions which prescriptions/refills for zolpidem 10 mg.
contention that Respondent should have were missing Respondent’s DEA number were
checked his own PMP report, under routinely filled notwithstanding that they were
Respondent nonetheless continued to
Virginia law in effect at the time of the facially invalid; as well as that the prescriptions employ Mullen for another five weeks,
2008 incident, Respondent was not were for hydrocodone in quantities and dosings that asserting that he needed to retain her
asabaliauskas on DSKBBXCHB2PROD with NOTICES
were clearly outside of the scope of what is usually because she was his insurance clerk and
authorized to obtain a PMP report prescribed by podiatrists), which is deeply
showing his own prescribings. See Va. disturbing. While the Government believes
needed her to maintain his cash flow
Stat. § 54.1–2523.B & C (2008). Indeed, Respondent’s and his office manager’s testimony as while a new insurance clerk was hired
Virginia law did not authorize the to his lack of knowledge is implausible, the burden and trained.
disclosure by the PMP Director of this was on the Government to prove otherwise under The ALJ rejected the Government’s
the theory it advanced in this case. contention that Respondent violated 21
information until 2013.27 See 2013 Va. 28 Depending upon the extent of the misuse, the
practitioner may need to request the cancellation of
CFR 1301.92 because he continued to
27 The Government argues that Respondent’s his registration number and the issuance of a new employ Mullen ‘‘even after learning of
‘‘failure to discover [Mullen’s diversion] over a five- registration number. her diversion.’’ Show Cause Order (ALJ
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![Federal Register / Vol. 82, No. 120 / Friday, June 23, 2017 / Notices 28687
Ex. 1), at 2; R.D. 37–38. According to the includes not only those acts that mention another 780 dosage units of
ALJ, this regulation ‘‘does not require constitute violations of its regulations, it zolpidem. Notably, the ALJ, in his
the immediate termination of an also includes ‘‘[s]uch other conduct discussion as to why he rejected the
employee; it only requires that the which may threaten the public health Government’s contention that
employer immediately assess the and safety.’’ 30 21 U.S.C. 823(f)(5). Respondent should have immediately
employee’s conduct to determine what Moreover, whether I were to apply fired Mullen, did not address this
employment action to take against the section 1301.92 or evaluate testimony.
employee.’’ R.D. 37. Respondent’s conduct under Factor I also disagree with the ALJ that the
In the ALJ’s view, ‘‘Respondent Five, I would come to the same result. measures undertaken by Respondent
immediately assessed both the Here, the evidence shows that by justify his failure to immediately
seriousness of Mullen’s violations and August 24, 2012, Respondent knew that terminate Mullen. As for his moving the
her position of responsibility, as Mullen had been convicted in state fax machine into the secure medications
required under’’ the regulation. Id. The court of two counts of prescription room, this did not address Mullen’s
ALJ also gave weight to Respondent’s fraud. And once he obtained the PMP ability to phone in prescriptions. So too,
testimony that while Mullen remained report which showed the controlled while Respondent took away Mullen’s
in his employment, he moved the fax substances prescriptions she obtained keys to the office, obviously she was
machine into the secure medication under his DEA registration, Respondent allowed into the office in order to train
room, took away her office keys, called knew that Mullen had committed at her replacement and Respondent offered
local pharmacies to alert them to least another 82 felony offenses of no testimony that anyone was watching
Mullen’s actions, and monitored his prescription fraud. Mullen on those days when he was at
DEA number on the PMP system.29 R.D. To the extent the ALJ’s his other offices.
37. The ALJ further gave weight to the recommendation suggests that As for the ALJ’s finding that
testimony that Respondent needed to Respondent properly ‘‘assessed . . . the Respondent ‘‘monitored his DEA
retain Mullen for this period because 99 seriousness of Mullen’s violations,’’ R.D. number on the PMP system,’’ R.D.37,
percent of his cash flow came from 37, I disagree. Indeed, proof that Mullen while Respondent claimed he did this
insurance payments and ‘‘no had committed a single act of ‘‘every month,’’ Tr. 382, he offered
replacement could immediately fill prescription fraud should have resulted conflicting testimony as to when he
Mullen’s position so as to continue the in her immediate termination. Of further started doing so. Specifically, after
Respondent’s normal business note, when confronted on cross- testifying that he checked the PMP
operations,’’ even though Respondent examination as to why he retained every month to see if anyone was
acknowledged that his ‘‘office manager Mullen even after he obtained the PMP misusing his number, when then asked
was competent to perform these duties.’’ report, Respondent attempted to by his counsel if he had found any
Id. at 38. minimize the scope of Mullen’s misuse since August 2012, Respondent
Continuing, the ALJ explained that misconduct when he testified that ‘‘I answered: ‘‘No. I will say I’ve been
‘‘[f]or small businesses that depend on acted upon the, you know, the doing every month for approximately a
each employee performing essential proportion of things that I knew. So it year, nine months, something like that
business functions, it is reasonable to wasn’t—it wasn’t what we’re looking at that. No, no deviations there.’’ 31 Id. at
expect that terminating an employee can in retrospective now with this huge 382–83. Yet when later asked by the ALJ
be a process rather than an situation. It was only with a handful of ‘‘when did you start using the PMP on
instantaneous action.’’ Id. The ALJ then information that I had, less than a a regular basis?’’ Respondent answered:
rejected the allegation, concluding that dozen.’’ Tr. 426. ‘‘August 24 of 2012.’’ Id. at 435. Not
Respondent had acted ‘‘[c]onsistent However, by August 24, 2012, only is this conflict in his testimony
with the requirements of 21 CFR Mullen’s criminal conduct in obtaining unresolved, Respondent did not testify
1301.92’’ by taking ‘‘immediate action prescriptions for herself alone made this as to any other instance during the
towards terminating Mullen’s an indisputably ‘‘huge situation’’ given remaining period of Mullen’s
employment because of her that she had obtained more than 5,000 employment in which he accessed the
misconduct.’’ Id. dosage units of hydrocodone 10 mg, the PMP to determine what prescriptions
Section 1301.92 is contained in a strongest dosage form of this highly were being dispensed under his
section of part 1301 which follows the abused controlled substance, not to registration.
heading: ‘‘EMPLOYEE SCREENING– To be sure, there is evidence that
NON-PRACTITIONERS,’’ thus raising 30 Notwithstanding that the Government did not Respondent called local pharmacies to
the question, which was not addressed cite Factor Five with reference to this allegation, alert them to Mullen’s actions. Yet the
Respondent clearly knew that his conduct in evidence also shows while Respondent
by either party or the ALJ as to whether retaining Mullen in his employment after
it even applies to Respondent who is a discovering that she was diverting drugs was at
claimed to have called ‘‘a handful of
practitioner. I need not decide this issue in the proceeding and put on a full defense these’’ pharmacies on August 20, 2012
question because under the public against the allegation. Of consequence, the public (the day the refill authorization form
interest factors do not impose substantive legal was found on the fax), at least 12 refills
interest standard applicable to duties which can be violated, but simply shape the
practitioners, the Agency’s authority scope of relevant evidence in the proceeding, and
for 90 or 120 dosage units of
Respondent clearly knew throughout the hydrocodone were nonetheless
29 The ALJ also found that ‘‘Respondent’s office proceeding that the Government was alleging that dispensed by several of these
asabaliauskas on DSKBBXCHB2PROD with NOTICES
manager monitored Mullen from August 20, 2012, his retention of Mullen was conduct which renders pharmacies after that date, including by
until she left the Respondent’s employment.’’ R.D. his registration inconsistent with the public
interest. ALJ Ex. 1, at 1–2 (citing 21 U.S.C. 824(a)(4)
those he called. Moreover, Respondent
37 (citing Tr. 79). The cited testimony involved
only the question by Respondent’s counsel: ‘‘Do and 823(f)). saw patients at four different locations
you recall whether you were more vigilant watching Of further note, 21 CFR 1301.76(a), which is titled
Ms. Mullen during that month that she was still ‘‘[o]ther security controls for practitioners,’’ 31 Even if Respondent meant that he had been
there?’’ followed by the office manager’s answer: ‘‘I provides, in part, that ‘‘[t]he registrant shall not checking the PMP for one year and nine months
would say yes.’’ Tr. 79. The office manager did not, employ as an agent or employee who has access to (since the date of the hearing), this still would not
however, offer any further testimony explaining in controlled substances, any person who has been support a finding that he had commenced doing so
what manner she was more vigilant in watching convicted of a felony offense relating to controlled every month since August 2012 and did so while
Mullen during this period. substances.’’ Mullen remained employed with him.
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in southwestern Virginia, and while establish an initial inventory.’’ GX 3, at which are generally applicable to all
there is no evidence as to the number of 1–2. Moreover, during the July 2013 registrants.
pharmacies in this area of Virginia, inspection, Diversion Investigators Fatal to Respondent’s contention is 21
presumably there are more than ‘‘a found that Respondent did not have a U.S.C. 885(a)(1). It provides that:
handful.’’ biennial inventory which was based on It shall not be necessary for the United
I further reject Respondent’s an actual count of the drugs on hand as States to negative any exemption or
contention that he was justified in required by DEA regulations. See 21 exception set forth in this subchapter in any
continuing to employ Mullen because CFR 1304.11(a) & (c). Rather, he complaint, information, indictment, or other
he needed to maintain his cash flow maintained a perpetual inventory, pleading or in any trial, hearing, or other
while a new insurance clerk was hired proceeding under this subchapter, and the
which was not based on an actual count
and trained. The evidence showed that burden of going forward with the evidence
of the drugs on hand at the required with respect to any such exemption or
Respondent’s office manager could have biennial interval, but rather, as the ALJ exception shall be upon the person claiming
performed these duties, and while she found, was ‘‘a mathematical calculation its benefit.
testified that she could not do so and of how many [controlled substances] the
perform her other duties, no evidence 21 U.S.C. 885(a)(1) (emphasis added).
Respondent should have had after By its plain terms, this provision applies
was offered that Respondent could not dispensing the listed amounts.’’ R.D. 41.
have hired someone to fill the office not only to criminal proceedings but
Thus, I agree with the ALJ that also to suspension and revocation
manager’s duties or that he could not Respondent violated 21 U.S.C. 827(a) by
have hired a billing service. Moreover, proceedings.
failing to establish an initial inventory Because section 827(c) is clearly an
Respondent offered no evidence that he (as found in the 2005 Consent Order)
did not have access to other sources of exception to the generally applicable
and by failing to ‘‘make a complete and recordkeeping requirements and
funds (such as his savings, credit cards, accurate’’ biennial inventory. R.D. 40–
or a line of credit) to support his Respondent is ‘‘the person claiming its
41. benefit,’’ he had the burden of
practice while a new insurance clerk In his Exceptions, Respondent raises
was hired and trained. As for the ALJ’s producing evidence to show why he
two contentions to the ALJ’s findings. was entitled to the exception. Id. As
suggestion that Respondent acted First, he argues that because he was
reasonably because he ran a small Respondent produced no evidence
engaged in administering medication to showing that he did not ‘‘charge[ ] his
business and Mullen performed an his patients, he was ‘‘not required to
essential business function, a DEA patients, either separately or together
perform the initial and biennial with charges for other professional
registrant is obligated at all times to act
inventories that are required of other services, for substances so dispensed or
in the public interest.
registrants.’’ Exceptions, at 1 (citations administered,’’ id. § 827(c)(1)(B), he is
It is true that ‘‘there was no evidence
that Mullen used her position in . . . omitted). Respondent points to 21 not entitled to claim the exception. I
Respondent’s office to generate any U.S.C. 827(c)(1)(B), which states, in therefore reject Respondent’s exception
fraudulent prescriptions after August relevant part, that the recordkeeping and hold that Respondent violated
20, 2012.’’ R.D. 38. Respondent was provisions of section 827 ‘‘shall not section 827(a) by failing to maintain
nonetheless willing to risk causing apply . . . to the administering of a proper inventories.32
additional harm to the public health and controlled substance in schedule II, III,
IV, or V unless the practitioner regularly The Failure To Maintain Adequate
safety. His conduct in continuing to Physical Security Allegation
employ a serial diverter clearly engages in the dispensing or
constitutes ‘‘conduct which may administering of controlled substances As found above, on occasion, the
threaten the public health and safety.’’ and charges his patients, either night before he was to perform a
21 U.S.C. 823(f)(5) (emphasis added). separately or together with charges for procedure, Respondent would set out in
other professional services, for a cup—outside of the controlled
The Recordkeeping Allegations substances so dispensed or substance safe—the controlled
Pursuant to 21 U.S.C. 827(a)(1), administered.’’ Exceptions, at 1–2. substances that his office manager was
‘‘every registrant shall . . . as soon . . . Respondent argues that ‘‘DEA had the to provide to his first patient. However,
as such registrant first engages in the burden of proof as to this allegation,’’ the evidence shows that the drugs were
manufacture, distribution, or dispensing and because the Government failed ‘‘to nonetheless kept locked in his
of controlled substances . . . and every offer evidence that [he] falls into the medication room which was secured
second year thereafter, make a complete statutory exception,’’ the allegation with a steel door (and door frame) that
and accurate record of all stocks thereof must be rejected. Id. at 2. Respondent had a deadbolt lock. The evidence also
on hand.’’ See also 21 CFR 1304.11(c) further maintains that ‘‘[t]his is not a shows that this office was a freestanding
(‘‘After the initial inventory is taken, the case where [he] seeks to invoke a building and that Respondent had a
registrant shall take a new inventory of statutory exception; rather, DEA seeks to security monitoring system.
all stocks of controlled substances on invoke it.’’ Id. The ALJ rejected the Government’s
hand at least every two years.’’). Respondent is mistaken. Section contention that Respondent violated 21
Moreover, ‘‘[e]ach inventory shall 827(a) states that ‘‘[e]xcept as provided CFR 1301.75, which provides that
contain a complete and accurate record in subsection (c) of this section . . . ‘‘[c]ontrolled substances listed in
of all controlled substances on hand on every registrant shall . . . as soon . . . [s]chedules II, III, IV, and V shall be
asabaliauskas on DSKBBXCHB2PROD with NOTICES
the date the inventory is taken. . . . The as such registrant first engages in the
32 As Respondent did not maintain a proper
inventory may be taken either as of . . . distribution[] or dispensing of
initial and biennial inventory at all, these are the
opening of business or as of the close of controlled substance, and every second violations he committed. Having made these
business on the inventory date and it year thereafter, make a complete and findings, I agree with Respondent that the ALJ’s
shall be indicated on the inventory.’’ Id. accurate record of all stocks thereof on additional findings that his inventory did not
§ 1304.11(a). hand.’’ (emphasis added). Thus, section contain the number of containers and the number
of units or volume in each container, see R.D. at 42,
The evidence shows that in 2005, 827(a) makes plain that the provisions ‘‘are subsumed under the ‘greater’ violation’’ of
Respondent entered into a Consent of subsection C are simply exceptions to failing to take a biennial inventory. Exceptions, at
Order which found that he ‘‘did not the provisions of subsection A and B, 3.
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stored in a securely locked, was Respondent’s ‘‘agent or employee’’ routinely, and that because her conduct
substantially constructed cabinet.’’ R.D. and was ‘‘acting in the usual course of was unlawful, it cannot qualify under
43–44. Noting that the Agency’s . . . her business or employment.’’ Id. at section 822(c) as ‘‘acting in the usual
regulations do not define the term 45. course of [a registrant’s] business or
‘‘substantially constructed cabinet,’’ the In so holding, the ALJ reasoned that employment.’’
ALJ explained that at least one because in his post-hearing brief, The Virginia Drug Control Act defines
prominent dictionary provides a ‘‘Respondent described [the office the term ‘‘[a]dminister [to] mean[ ] the
definition of the term ‘‘cabinet’’ which manager’s] administration of controlled direct application of a controlled
includes ‘‘[a] small or private room set substances as occurring only on ‘limited substance, whether by injection,
aside for some specific activity.’’ R.D. 44 occasions,’ ’’ ‘‘Respondent himself inhalation, ingestion, or any other
(quoting American Heritage Dictionary argued . . . that [she] did not means, to the body of a patient . . . by (i)
of the English Language 185 (1976)). administer controlled substances in the a practitioner or by his authorized agent
The ALJ further gave ‘‘consideration to usual course of business.’’ Id. (quoting and under his direction or (ii) the
the factors contained in 21 CFR Resp. Post-Hrng. Br. 38). Continuing, the patient . . . at the direction and in the
1301.71(b)’’ and found that ALJ explained that he was ‘‘find[ing] as presence of the practitioner.’’ Va. Code
Respondent’s use of the Extra Meds a matter of fact that [the office § 54.1–3401. Even assuming that the
Room ‘‘to store his controlled manager’s] administration of controlled office manager’s conduct in providing
substances substantially complied with substances was described repeatedly as the drugs to patients falls within the
the requirements of 21 CFR 1301.71(b).’’ ‘occasional,’ which is the opposite of provision allowing a practitioner’s
Id. ‘usual.’ Therefore, 21 [CFR] 1301.22(a) ‘‘authorized agent’’ to do so, the Virginia
Of note, section 1301.75(b) does not does not apply.’’ Id. Drug Control Act contained extensive
require that most schedule II through V Respondent takes exception to the and detailed provisions governing the
controlled substances be stored in a ALJ’s legal conclusion. He argues that circumstances in which drugs can be
safe, and indeed, section 1301.75(e) his office manager was an agent within administered by someone other than a
specifies two drugs (carfentanil the meaning of the CSA, which defines licensed prescribing practitioner. See id.
etorphine hydrochloride and the term as ‘‘an authorized person who § 54.1–3408. Relevant here is subsection
diprenorphine) which ‘‘shall be stored acts on behalf of or at the direction of U, which states:
in a safe or steel cabinet equivalent to a manufacturer, distributor, or
dispenser.’’ Exceptions, at 4 (quoting 21 Pursuant to a specific order for a patient
a U.S. Government Class V security and under his direct and immediate
container.’’ 21 CFR 1301.75(b) & (e). U.S.C. 802(3)). Respondent further notes supervision, a prescriber may authorize the
And while the use of the word that ‘‘[w]hile the phrase ‘in the usual administration of controlled substances by
‘‘cabinet’’ to describe a small room course of business’ is used many times personnel who have been properly trained to
appears archaic,33 I agree with the ALJ in the CSA and the associated assist a doctor of medicine or osteopathic
that in light of the small amount of regulations, it is not defined.’’ Id. at 5 medicine, provided the method does not
controlled substances that were stored (citing 21 U.S.C. 822(c); 21 CFR included intravenous, intrathecal, or epidural
1300.04). Respondent then maintains administration and the prescriber remains
outside of the safe and the level of
that ‘‘[t]he fact that a business practice responsible for such administration.
security provided by the medication
room and the office’s alarm system, occasionally, or on limited occasions, Id. § 54.1–3408.U. Even assuming that
Respondent nonetheless remained in does not mean that it is not in the usual this provision allows a doctor of
substantial compliance with section course of that business.’’ Id. Respondent podiatry 35 to authorize his employee to
1301.75 when he left the drugs outside argues that the testimony shows ‘‘that administer a controlled substance to his
of the safe but locked in the medication during the course of [his] surgical patient, the evidence shows that
room. practice, it was in the usual course of Respondent would approve the
business for [the office manager] to administration when he was ‘‘going to
Aiding and Abetting the Unlawful administer medication in lieu of [his] be late,’’ prompting his office manager
Distribution of Controlled Substances doing it personally when [he] was not to call and ask ‘‘if she [could]
by an Unregistered Person going to be in the office when the administer . . . the medicines.’’ Tr. 337.
The Government alleged and the ALJ surgery patient arrived[.]’’ Id. Respondent was not in the office when
found that Respondent aided and Respondent thus contends that the this occurred, and while he asserted that
abetted the unlawful distribution of office manager ‘‘was acting as [his] agent
controlled substances when he allowed and employee within the scope of her 35 While this provision specifically refers to ‘‘a
his office manager to administer the responsibilities and duties’’ and was not doctor of medicine or osteopathic medicine,’’ Va.
required ‘‘to be registered.’’ Id. Code § 54.1–3408.U, subsection A refers to ‘‘[a]
controlled substances, which he had set practitioner of medicine, osteopathy, podiatry,
out in the drug room the night before, Respondent thus contends that he ‘‘did dentistry, or veterinary medicine.’’ Id. § 54.1–
to those patients who were undergoing not aid and abet an illegal distribution 3408.A.
procedures and he had yet to arrive at of a controlled substance under 21 In his Post-Hearing Brief, Respondent implies
his office. R.D. 44–46. The evidence U.S.C. 841(a).’’ Id. that this practice was lawful under the Board of
I need not decide whether the Medicine’s Rules governing Office-Based
showed that Respondent’s office Anesthesia. Resp. Post-Hrng. Br. 50. He specifically
manager did not hold a registration to frequency of the office manager’s notes that Board’s ‘‘requirements for office based
dispense controlled substances.34 Id. at administrations of controlled substances anesthesia’’ do not apply to ‘‘[m]inimal sedation/
asabaliauskas on DSKBBXCHB2PROD with NOTICES
44 (citing Tr. 57). The ALJ further to Respondent’s patients was sufficient anxiolysis.’’ Id. (quoting 18 Va. Admin. Code 85–
to establish that she was acting in the 20–320(A)(1). That may be (even though there is no
rejected Respondent’s contention that evidence as to whether the cocktail of drugs that
his office manager was exempt from usual course of her employment when were given to the patients resulted in the
registration under 21 CFR 1301.22(a) she did so. Rather, I conclude that inducement of ‘‘minimal sedation/anxiolysis’’ or
because in administering the drugs, she because under Virginia law, the office ‘‘moderate sedation/conscious sedation,’’ which is
manager could not legally administer subject to the requirements for office-based
anesthesia), but this argument does not address
33 See Merriam-Webster.com. Merriam-Webster, controlled substances to Respondent’s whether Respondent’s practice of having his office
n.d. Web. 22 May 2017. patients, it does not matter whether she manager administer the drugs to the patients in his
34 Nor does she hold any DEA registration. Tr. 57. did so only ‘‘on limited occasions’’ or absence was lawful under Va. Code § 54.1–3408.U.
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‘‘he thought it was a common practice’’ agree with the ALJ that Respondent Thus, applying ‘‘simple contract law,’’
and was permitted by the Board of aided and abetted these violations and Respondent got exactly what he
Medicine, he produced no materials that this conduct is actionable under bargained for—the renewal of his
from the Board such as an opinion letter Factor Four. R.D. 46; see also 18 U.S.C. registration subject to various
or Board decision that would support 2. conditions. What he did not bargain for
his contention that even though he was was the ability to preclude the Agency
The State Court Convictions
not physically present in the office, he from considering the state court
was nonetheless engaged in the ‘‘direct As the ALJ found, in 2000, convictions in the event he committed
and immediate supervision’’ of his Respondent pled guilty in state court to additional misconduct in the future and
office manager when he authorized his four felony counts of the unlawful was subject to a Show Cause Order.38
office manager to administer the drugs possession of controlled substances I therefore reject Respondent’s
to the patients. which included sufentanil, oxycodone, exceptions that I am precluded from
Accordingly, I reject Respondent’s pethidine, and hydromorphone, as well considering Respondent’s state court
exception that his office manager was as one misdemeanor count of unlawful convictions by the MOA. However, in
exempt from registration because she possession of marijuana. R.D. 47. While light of the fact that Respondent’s
was ‘‘acting in the usual course of [her] the ALJ noted that the Agency had convictions occurred 17 years ago and
. . . employment’’ and that he is not ‘‘declined to revoke’’ Respondent’s that there is no evidence that
liable for aiding and abetting the registration based on these convictions Respondent has been subsequently
unlawful distribution of controlled and the convictions were over 15 years convicted of either a federal or state
substances. As explained above, I old, he rejected Respondent’s offense related to controlled substances
further hold that on those occasions contention that because the Agency (whether falling within the scope of
when Respondent was not physically entered into the Memorandum of Factor Three or Factor Five), I place
present in the office and his office Agreement (MOA) with Respondent it is only limited weight on the state court
manager administered the controlled now estopped from seeking revocation convictions.
substances to various patients, she based on these convictions. Id.
engaged in an unlawful distribution Respondent takes exception to the Summary of the Government’s Prima
under 21 U.S.C. 841(a)(1).36 I further ALJ’s ruling. Exceptions, at 10–11. He Facie Case
argues that that ‘‘[t]he ALJ cited no basis Given Respondent’s knowledge that
36 In his Exceptions, Respondent argues that for his finding that the MOA did not Mullen had fraudulently obtained
‘‘[t]here is no DEA precedent for finding [the office estopped [sic] DEA from relying on [his] controlled substance prescriptions/
manager’s] conduct to be an illegal distribution.’’
Exceptions, at 5 (citing Fred Samimi, 79 FR 18698
2000 conviction [sic] in its attempt to refills 82 times from January 21, 2008
(2014), and Margy Temponeras, 77 FR 45675 sanction him today.’’ Id. at 10. He also through August 24, 2012, as well as his
(2012)). Discussing Samimi, Respondent states that argues that he ‘‘has not found an agency knowledge that Mullen had been
‘‘Dr. Samimi was found by the State of California decision that relied on conduct convicted in state court of two counts of
to have aided and abetted the unlicensed practice
of medicine by allowing his staff to dispense (not
predating a MOA as a basis for revoking prescription fraud, I conclude that he
administer) controlled substances when he was not a registration.’’ Id. And he argues that has committed ‘‘other conduct which
present. In sustaining that finding as relevant to her ‘‘[t]he MOA was a contract between may threaten the public health and
consideration, the Administrator made no DEA and [himself],’’ that the MOA safety’’ when he failed to immediately
suggestions that Dr. Samimi’s actions violated the
CSA.’’ Id. And discussing Temponeras, Respondent
placed restrictions on his registration terminate Mullen. 21 U.S.C. 823(f)(5). I
noted that ‘‘Dr. Temponeras had unregistered ‘‘[i]n lieu of initiating procedures for the further conclude that Respondent’s
employees dispensing (not administering) drugs to revocation of’’ his registration, that he convictions for the unlawful possession
patients by filling prescriptions while she was not ‘‘fulfilled his obligations under the’’ of various controlled substances provide
actually present[,]’’ and that while ‘‘the
Administrator found that Dr. Temponeras violated
MOA, and that ‘‘DEA is bound by its limited support for the finding that
the CSA because she was not registered as a agreement to accept the MOA in lieu of Respondent has committed ‘‘other
dispenser and . . . violated Ohio law by allowing seeking revocation based on [his] 2000 conduct which may threaten public
unlicensed individual[s] to fill controlled conviction’’ under ‘‘[s]imple contract health or safety.’’ Id.
substance[ ] prescriptions . . . there was no
reference to Dr. Temponeras’ conduct as
law.’’ Id. at 11.
constituting illegal distributions.’’ Id. at 5–6 (int. I disagree. While the MOA noted that (that being one year from the date that DEA signed
quotations omitted). ‘‘[i]n light of [his] past actions, authority the agreement), the Agency then brought a show
Neither case supports Respondent. As for exists under 21 U.S.C. [823(f) and cause proceeding based on the exact same grounds
Samimi, the Government never argued that the that led to the MOA and nothing else. But it has
824a)(4)] for DEA to initiate Show Cause not.
physician’s practice of allowing unlicensed staff to
dispense controlled substances without being action to revoke [his ] registration’’ and 38 Respondent also argues that he ‘‘has not found
directly supervised by him constituted a violation that ‘‘[i]n lieu of initiating procedures an Agency decision that relied on conduct
of 21 U.S.C. 841, and thus, that case did not address for the revocation of [his] [r]egistration,’’ predating a MOA as a basis for revoking a
the question of whether an unregistered person can the parties had agreed to various terms registration.’’ Exceptions, at 10. However, in Mark
administer controlled substances to a patient De La Lama, 76 FR 20011 (2011), the Agency
outside of the presence of the physician. See 79 FR including the renewal of his denied an application (submitted by a nurse
at 18698 (discussing allegations of Show Cause registration, none of those terms practitioner who allowed his registration to expire)
Order); id. at 18710 (discussing state board’s precluded the Agency from relying on based, in part, on his prior convictions for
findings and relevant state law prohibiting practice the state court convictions in any controlled substance offenses which gave rise to an
of allowing unlicensed and unsupervised office MOA when he first became registered and which
subsequent proceeding.37 RX 83, at 2.
asabaliauskas on DSKBBXCHB2PROD with NOTICES
staff to dispense drugs). he subsequently violated. See 76 FR at 20018 &
As for Temponeras, the Agency’s decision found n.15; id. at 20019 n.18. While the decision did not
that the physician, who was not registered as a provisions of’’ the CSA, and § 841(a), which renders place substantial weight on the applicant’s
pharmacy, ‘‘exceeded the authority of her unlawful the knowing or intentional distribution of convictions due to their age, it did not hold that the
registration because she authorized her employees a controlled substance ‘‘[e]xcept as authorized by’’ Agency could not consider the convictions because
to fill prescriptions issued by her father.’’ 77 FR at the CSA. Thus, Respondent’s assertion that ‘‘[i]n they predated the MOA. See id.
45677. Notably, the decision cited both 21 U.S.C. Temponeras, there was no reference to Dr. Moreover, Respondent cites no Agency decision
§ 822(b), which provides that a registrant is Temponeras’ conduct as constituting ‘illegal which holds that following the entry of an MOA,
authorized to engage in controlled substances distributions’ ’’ misstates the case. Exceptions, at 6. the Agency is precluded from considering the
activities ‘‘to the extent authorized by [his] 37 Respondent might have an argument under conduct which gave rise to the MOA in a
registration and in conformity with the other ‘‘simple contract law’’ if, after the MOA expired subsequent proceeding.
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![Federal Register / Vol. 82, No. 120 / Friday, June 23, 2017 / Notices 28691
As also found above, Respondent 49995, 50004 (2010); see also Jeri health and safety, I am compelled to
failed to comply with the CSA’s Hassman, 75 FR 8194, 8236 (2010) reject the ALJ’s recommended sanction
requirement that he ‘‘make a complete (quoting Hoxie v. DEA, 419 F.3d 477, and conclude that the imposition of a
and accurate record of all stocks . . . on 483 (6th Cir. 2005) (‘‘Candor during substantial period of outright
hand’’ both when he first engaged in the DEA investigations, regardless of the suspension is warranted.39
dispensing of controlled substances as severity of the violations alleged, is Notably, Respondent did not
well as ‘‘every second year thereafter.’’ considered by the DEA to be an acknowledge his misconduct in
21 U.S.C. 827(a)(1); 21 CFR 1304.11(a) & important factor when assessing retaining Mullen, and instead, justified
(c). He also violated the CSA by whether a physician’s registration is his decision to retain her until a new
directing his office manager, who does consistent with the public interest[.]’’). insurance clerk was hired and trained
not hold a registration, to administer While a registrant must accept because of his need to maintain his cash
controlled substances to those patients responsibility for his misconduct and flow. Moreover, when confronted as to
who were to undergo procedures when demonstrate that he will not engage in why he had retained Mullen even after
Respondent was not at his office. 21 future misconduct in order to establish he obtained the PMP report which listed
U.S.C. 841(a); 18 U.S.C. 2. Both his that his continued registration is 82 different prescriptions which she had
failure to maintain proper records and consistent with the public interest, DEA fraudulently obtained, Respondent
his conduct in directing his office has repeatedly held that these are not attempted to minimize the scope of her
manager to administer controlled the only factors that are relevant in misconduct, testifying that he ‘‘acted
substances to patients is relevant in determining the appropriate disposition upon . . . the proportion of things that
assessing Respondent’s experience in of the matter. See, e.g., Joseph Gaudio, I knew. So it wasn’t . . . what we’re
dispensing controlled substances 74 FR 10083, 10094 (2009); Southwood looking at in retrospective now with this
(Factor Two) and his compliance with Pharmaceuticals, Inc., 72 FR 36487, huge situation. It was only with a
applicable laws related to controlled 36504 (2007). Obviously, the handful of information that I had, less
substances (Factor Four). egregiousness and extent of a than a dozen.’’ Tr. 426.
I therefore hold that the Government registrant’s misconduct are significant It is true that there is no evidence that
has met its prima facie burden of factors in determining the appropriate Mullen continued her criminal acts
showing that Respondent ‘‘has sanction. See Jacobo Dreszer, 76 FR during the five week period before she
committed such acts as would render 19386, 19387–88 (2011) (explaining that was finally terminated. Had the
his registration . . . inconsistent with a respondent can ‘‘argue that even Government produced such evidence, I
the public interest.’’ 21 U.S.C. 824(a)(4). though the Government has made out a would revoke Respondent’s registration.
I further conclude that grounds exist to prima facie case, his conduct was not so While it is also true that Respondent
suspend or revoke Respondent’s egregious as to warrant revocation’’); moved the fax machine into a room to
registration. Paul H. Volkman, 73 FR 30630, 30644 which Mullen did not have access, this
(2008); see also Paul Weir Battershell, does not mitigate Respondent’s
Sanction
76 FR 44359, 44369 (2011) (imposing misconduct because the evidence shows
Where, as here, the Government has six-month suspension, noting that the
established grounds to revoke a that many of the fraudulent
evidence was not limited to security and prescriptions (whether for Mullen
registration or deny an application, a recordkeeping violations found at first
respondent must then ‘‘present[ ] personally or for her co-conspirators)
inspection and ‘‘manifested a disturbing were phoned in.
sufficient mitigating evidence’’ to show pattern of indifference on the part of
why he can be entrusted with a new Finally, I conclude that the Agency’s
[r]espondent to his obligations as a
registration. Samuel S. Jackson, 72 FR interests in both specific and general
registrant’’); Gregory D. Owens, 74 FR
23848, 23853 (2007) (quoting Leo R. deterrence also support a substantial
36751, 36757 n.22 (2009).
Miller, 53 FR 21931, 21932 (1988)). So too, the Agency can consider the period of outright suspension for this
‘‘ ‘Moreover, because ‘past performance need to deter similar acts, both with misconduct. As to specific deterrence,
is the best predictor of future respect to the respondent in a particular were Respondent to confront the same
performance,’ ALRA Labs, Inc. v. DEA, case and the community of registrants. situation of a diverting employee in the
54 F.3d 450, 452 (7th Cir. 1995), [DEA] See Gaudio, 74 FR at 10095 (quoting future, he must know that there will be
has repeatedly held that where [a Southwood, 71 FR at 36503). Cf. serious consequences for failing to act
registrant] has committed acts McCarthy v. SEC, 406 F.3d 179, 188–89 responsibly. Also, Respondent may
inconsistent with the public interest, the (2d Cir. 2005) (upholding SEC’s express confront different scenarios in which he
[registrant] must accept responsibility adoption of ‘‘deterrence, both specific is faced with the choice of placing his
for [his] actions and demonstrate that and general, as a component in private interests over the public interest.
[he] will not engage in future analyzing the remedial efficacy of As to the Agency’s interests in general
misconduct.’’ Jayam Krishna-Iyer, 74 FR sanctions’’). deterrence, the community of
459, 463 (2009) (citing Medicine Having considered the relevant facts practitioner registrants must know that
Shoppe, 73 FR 364, 387 (2008)); see also and circumstances, I disagree with the there will be substantial consequences
Jackson, 72 FR at 23853; John H. ALJ’s recommended sanction of a one for failing to promptly terminate
Kennedy, 71 FR 35705, 35709 (2006); year suspension which would not be employees who are diverting controlled
Cuong Tron Tran, 63 FR 64280, 64283 effective for three months from the date substances.40
asabaliauskas on DSKBBXCHB2PROD with NOTICES
(1998); Prince George Daniels, 60 FR of my Final Order and which would be
39 Because the ALJ rejected this allegation, he did
62884, 62887 (1995). Also, a registrant’s stayed provided Respondent takes
not address the relevant facts and circumstances
candor during both an investigation and certain courses within that period. related to this misconduct.
the hearing itself is an important factor Instead, because I find Respondent’s 40 Respondent argues that I should consider his
to be considered in determining both failure to immediately terminate Mullen cooperation with law enforcement upon
whether he has accepted responsibility upon determining that she had discovering the 2012 fraudulent refill request. Resp.
Post-Hrng. Br. 67. However, as discussed above, I
as well as the appropriate sanction. fraudulently obtained 82 prescriptions conclude that the other factors discussed above
Michael S. Moore, 76 FR 45867, 45868 for herself is egregious misconduct, greatly outweigh his cooperation with the
(2011); Robert F. Hunt, D.O., 75 FR which clearly posed a threat to public Detective’s investigation.
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![28692 Federal Register / Vol. 82, No. 120 / Friday, June 23, 2017 / Notices
Accordingly, based solely on Moreover, while in response to the DI’s the suspension, he intends to resume
Respondent’s misconduct in retaining instructions Respondent started taking administering and/or engaging in the
Mullen, I conclude that the factors an actual count, the ALJ found that direct dispensing of controlled
relevant to this misconduct support the ‘‘Respondent did not show remorse for substances, Respondent must provide
outright suspension of Respondent’s his recordkeeping violations.’’ R.D. 49. evidence to the local DEA office that he
registration for a period of one year. As for his practice of directing his has completed a course in controlled
Moreover, I conclude that Respondent’s office manager to administer controlled substance recordkeeping prior to doing
failure to maintain complete and substances to patients who were so. If Respondent does not provide such
accurate inventories, as well as his undergoing procedures when he was evidence, his registration shall be
misconduct in directing his unregistered running late and not in the office, the restricted to prescribing controlled
office manager to administer controlled ALJ also found that there were several substances.
substances to patients, provide factors that mitigate the egregiousness of
Order
additional support for my conclusion these violations. According to the ALJ,
that an outright suspension for one year these factors include that this happened Pursuant to the authority vested in me
is warranted. only ‘‘occasionally,’’ that Respondent by 21 U.S.C. 824(a) as well as 21 CFR
While Respondent’s failure to had previously determined what 0.100(b), I order that DEA Certificate of
establish an initial inventory occurred medications should be administered to Registration No. BK0639279 issued to
sometime ago, his failure to maintain a the patient based on his assessment of Peter F. Kelly, D.P.M., be, and it hereby
complete and accurate biennial the patient’s needs, that there is no is, suspended for a period of one year.
inventory based on an actual physical evidence that the drugs were diverted, I further order that upon termination of
count of the controlled substances he and that Respondent had ceased this the suspension, said registration shall be
had on hand is far more recent. While practice after a patient questioned it. restricted to prescribing controlled
Respondent testified that he kept the R.D. 50–51. substances, until such date that Peter F.
records as he did based on the guidance I do not take issue with the ALJ’s Kelly, D.P.M., provides evidence that he
he received from the state inspector in conclusions that these factors mitigate has completed a course in controlled
the 2005 time frame, the requirements to the egregiousness of these violations. substance prescribing. This Order is
take an actual physical count ‘‘either as However, here again, the ALJ found that effective July 24, 2017.
of the opening of business or as of the ‘‘Respondent never acknowledged that Dated: June 19, 2017.
close of business on the inventory date’’ [the office manager’s] administration of Chuck Rosenberg,
and to indicate this ‘‘on the inventory’’ controlled substances violated DEA
Acting Administrator.
are clear on the regulation’s face. And regulations. . . . Respondent never
[FR Doc. 2017–13158 Filed 6–22–17; 8:45 am]
even if Respondent was given erroneous showed remorse for aiding and abetting
BILLING CODE 4410–09–P
advice by the state inspector, dispensations by a non-registrant.
Respondent is responsible for knowing Rather, the Respondent denied that
what is required by DEA’s regulations.41 these actions were wrongful.’’ Id. at 46.
DEPARTMENT OF JUSTICE
The ALJ thus concluded that
41 In his Recommended Decision, the ALJ ‘‘Respondent has not accepted Federal Bureau of Investigation
discussed eight considerations that in his view, responsibility for his conduct, even
‘‘mitigate the egregious of the shortcomings of [OMB Number 1110–0021]
Respondent’s controlled substance inventory.’’ R.D.
though he discontinued these practices
50. However, several of these do not mitigate the [and] . . . Respondent has not rebutted
Agency Information Collection
violation. For example, the ALJ noted that the Government’s prima facie showing
‘‘Respondent kept a thorough and detailed Activities; Proposed eCollection
that the Respondent violated 21 U.S.C.
perpetual inventory,’’ that the DI was able to use the eComments; Requested; Extension
perpetual inventory to do an audit, and that ‘‘there
[§ 841(a)].’’ Id. I agree.
Respondent’s violations in failing to Without Change, of a Previously
is no evidence that the Respondent’s recordkeeping Approved Collection; FBI National
errors resulted in any diversion.’’ Id. These do not take a proper inventory and in directing
mitigate the violation because the CSA and DEA his unregistered office manager to Academy: End-of-Session Student
regulations require that a registrant take an actual
administer controlled substances, Course Questionnaire; FBI National
physical count of the controlled substances on Academy: General Remarks
hand, and an accurate actual count, as coupled with his failure to acknowledge
his misconduct with respect to both Questionnaire
memorialized in either an initial or biennial
inventory, is essential in conducting an accurate violations, provide additional support AGENCY: Federal Bureau of
audit. Likewise, an accurate audit is essential in
determining whether a registrant is maintaining
for my decision to suspend Investigation, Department of Justice.
complete and accurate records of both the Respondent’s registration for a period of ACTION: 60-day notice.
controlled substances he receives and those he one year. As for the state court
‘‘deliver[s] or otherwise dispose[s] of.’’ 21 U.S.C. convictions, because they did not SUMMARY: The Department of Justice
827(a)(3). As for the ALJ’s statement that there is no
evidence that Respondent’s recordkeeping errors
involve distribution to others and (DOJ), Office of Justice Programs,
resulted in diversion, generally, it is diversion that occurred 17 years ago, I give them only Bureau of Justice Statistics, will be
results in recordkeeping irregularities and not the limited weight in my determination as submitting the following information
other way around. to the appropriate sanction. collection request to the Office of
As for the ALJ’s observation that Respondent kept Accordingly, I will order that Management and Budget (OMB) for
receipt records that ‘‘showed the number of
Respondent’s registration be suspended review and approval in accordance with
asabaliauskas on DSKBBXCHB2PROD with NOTICES
containers, the number of dosages in the containers,
and the strength of the dosages,’’ these records were outright for a period of one year. While the Paperwork Reduction Act of 1995.
prepared by Respondent’s suppliers, see, e.g., RX Respondent testified that he no longer DATES: Comments are encouraged and
89, at 37–47; and Respondent is required to uses controlled substances during his
maintain these records under the CSA and DEA will be accepted for 60 days until
regulations. See 21 U.S.C. 827(a)(3); 21 CFR procedures, if, following termination of August 22, 2017.
1304.21(a); id. § 1304.22(c). Moreover, because I FOR FURTHER INFORMATION CONTACT:
hold that the violation is based on his failure to number of units or volume of each container, and
have a biennial inventory based on an actual count the drug strength, the fact that he had records
If you have additional comments
of the drugs on hand and not on the fact that his showing this information for the various receipts especially on the estimated public
inventory did not list the number of containers, the does not mitigate the violation. burden or associated response time,
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Document Created: 2017-06-23 03:37:12
Document Modified: 2017-06-23 03:37:12
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