82_FR_46717 82 FR 46525 - Warren B. Dailey, M.D.; Decision and Order

82 FR 46525 - Warren B. Dailey, M.D.; Decision and Order

DEPARTMENT OF JUSTICE
Drug Enforcement Administration

Federal Register Volume 82, Issue 192 (October 5, 2017)

Page Range46525-46527
FR Document2017-21382

Federal Register, Volume 82 Issue 192 (Thursday, October 5, 2017) 
[Federal Register Volume 82, Number 192 (Thursday, October 5, 2017)]
[Notices]
[Pages 46525-46527]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-21382]


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DEPARTMENT OF JUSTICE

Drug Enforcement Administration


Warren B. Dailey, M.D.; Decision and Order

    On February 7, 2017, the Assistant Administrator, Diversion Control 
Division, Drug Enforcement Administration (DEA), issued an Order to 
Show Cause to Warren B. Dailey, M.D. (Registrant), of Houston, Texas. 
The Show Cause Order proposed the revocation of Registrant's DEA 
Certificate of Registration, pursuant to 21 U.S.C. 824(a)(3) and (5), 
on two grounds: (1) That he does not have authority to handle 
controlled substances in Texas, the State in which he is registered 
with the Agency; and (2) he has been excluded from participation in a 
program pursuant to section 1320a-7(a) of Title 42. GX 2 (Order to Show 
Cause), at 1.
    With respect to the Agency's jurisdiction, the Show Cause Order 
alleged that Registrant is registered as a practitioner in schedules II 
through V, under Certificate of Registration No. AD9639038, at the 
registered address of 2305 Southmore, Houston, Texas. Id. The Order 
alleged that Registrant's registration expires by its terms on June 30, 
2018. Id.
    As to the substantive grounds for the proceeding, the Show Cause 
Order specifically alleged that ``[o]n October 12, 2016, the Texas 
Medical Board issued an Order of Suspension by Operation of Law, 
suspending [Registrant's] Texas Medical License . . . based on [his] 
felony conviction on March 30, 2016 . . . for health care fraud.'' Id. 
The Show Cause Order then alleged that Registrant is ``currently 
without authority to practice medicine or handle controlled substances 
in the State of Texas, the [S]tate in which he registered with'' the 
Agency, thus subjecting his registration to revocation. Id. at (citing 
21 U.S.C. 824(a)(3); other citations omitted).
    The Show Cause Order also alleged that on December 30, 2016, the 
Office of Inspector General, U.S. Department of Health and Human 
Services (HHS IG), issued a letter to Registrant ``excluding [him] from 
participation in all Federal health care programs based on [his] felony 
conviction on March 30, 2016, in the U.S. District Court for the 
Southern District of Texas for health care fraud.'' Id. at 2. The Show 
Cause Order further alleged that ``[t]he exclusion was effective twenty 
days from the date of the letter and is for a minimum period of twenty 
years.'' Id. The Show Cause Order then asserted that Registrant's ``DEA 
registration is also subject to revocation based on [his] exclusion 
from participation in a program pursuant to section 1320a-7(a) of Title 
42.'' Id. (citing 21 U.S.C. 824(a)(5)).
    The Show Cause Order notified Registrant of his right to request a 
hearing on the allegations, or to submit a written statement in lieu of 
a hearing, the procedure for electing either option, and the 
consequence for failing to elect either option. Id. (citing 21 CFR 
1301.43). The Order also notified Registrant of his right to submit a 
corrective action plan under 21 U.S.C. 824(c)(2)(C). Id. at 3.
    On February 7, 2017, the Show Cause Order was mailed to Registrant, 
via first class mail, addressed to him at his registered address at 
2305 Southmore, Houston, Texas. GX 5. Affidavit of Service by DEA 
Analyst, Office of Chief Counsel. Also, on February 21, 2016, a 
Diversion Investigator (DI) with the Houston Division Office emailed 
the Show Cause Order to an attorney, who represented Registrant in the 
state board proceeding, who accepted service on his behalf. GX 4. In 
his email, the attorney represented that he was ``accepting service 
upon'' Registrant. Id. (copy of email between DI and attorney accepting 
service on Registrant.)
    On April 6, 2017 the Government forwarded a Request for Final 
Agency Action (RFAA) and an evidentiary record to my Office. On review, 
I found the Government's attempts at service insufficient. As for the 
Government's attempt to serve Registrant by mail addressed to his 
registered address, I found this inadequate because it clearly knew 
that Registrant had been convicted of multiple federal felony offenses 
more than a year earlier and was likely incarcerated in a United States 
Penitentiary. See Robinson v. Hanrahan, 409 U.S. 38, 40 (1972) (``[T]he 
State knew that appellant was not at the address to which the notice 
was mailed . . . since he was at that very time confined in . . . jail. 
Under these circumstances, it cannot be said that the State made any 
effort to provide notice which was `reasonably calculated' to apprise 
appellant of the pendency of the . . . proceedings.''); see also Jones 
v. Flowers, 547 U.S. 220, 230 (2006) (citing with approval Robinson and 
noting that its cases ``require[] the government to consider unique 
information about an intended recipient regardless of whether a 
statutory scheme is reasonably calculated to provided notice in the 
ordinary case'').
    I also found the Government's service on the attorney insufficient. 
In holding so, I explained that the CSA states that ``[b]efore taking 
action pursuant to [21 U.S.C. 824(a)] . . . the Attorney General shall 
serve upon the . . . registrant an order to show cause why registration 
should not be . . . revoked[ ] or suspended.'' 21 U.S.C. 824(c) 
(emphasis added). While I explained that the Agency has found that 
service on an attorney may satisfy the CSA's requirement that a Show 
Cause Order be ``serve[d] upon the . . . registrant,'' I noted that the 
Agency has made clear

[[Page 46526]]

that `` [t]he mere relationship between a defendant and his attorney 
does not, in itself, convey authority to accept service.'' David M. 
Lewis, 78 FR 36951 (2013) (quoting Harbinson v. Commonwealth of 
Virginia, 2010 WL 3655980, at *9 (E.D. Va. Aug. 11, 2010) (quoting 
Davies v. Jobs & Adverts Online, Gmbh, 94 F.Supp.2d 719, 722 (E.D. Va. 
2000))). See also United States v. Ziegler Bolt & Parts Co., 111 F.3d 
878, 881 (Fed. Cir. 1997); Grandbouche v. Lovell, 913 F.2d 835, 837 
(10th Cir. 1990); Ransom v. Brennan, 437 F.2d 513, 518-19 (5th Cir. 
1971). ``Rather, the party seeking to establish the agency relationship 
must show ``that the attorney exercised authority beyond the attorney-
client relationship, including the power to accept service.'' 
Harbinson, 2010 WL 3655980, at * 9 (quoting Davies, 94 F.Supp.2d at 722 
(quoting Ziegler, 111 F.3d at 881)).
    I further explained that while an attorney's authority to act as an 
agent for the acceptance of process ``may be implied from surrounding 
circumstances indicating the intent of'' his client, In re Focus Media 
Inc., 387 F.3d 1077, 1082 (9th Cir. 2004) (other citation and internal 
quotations omitted), ``an agent's authority to act cannot be 
established solely from the agent's actions.'' Id. at 1084. ``Rather, 
the authority must be established by an act of the principal.'' Id. 
(citing FDIC v. Oaklawn Apartments, 959 F.2d 170, 175 (10th Cir. 
1992)). Because the Government offered no evidence of an act by the 
Registrant establishing that he granted authority to the attorney to 
accept process on his behalf in this proceeding, I found that the 
Government had not properly served Respondent. Focus Media, 387 F.3d at 
1084.
    Thereafter, the Government reissued the Show Cause Order and on 
July 17, 2017, a Diversion Investigator mailed the Order by certified 
mail addressed to Respondent, at the United States Penitentiary in 
Beaumont, Texas.\1\ GX 7. According to the tracking information 
obtained from the U.S. Postal Service, on July 20, 2017, the mailing 
was delivered to the Penitentiary. Id., see also GX 8. I therefore find 
that the Government accomplished service on July 20, 2017.
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    \1\ There is no evidence in the record as to how the DI obtained 
Registrant's address. However, according to the Bureau of Prisons 
Inmate Locator (of which I take official notice), Registrant is 
incarcerated at USP Beaumont. See 5 U.S.C. 556(e).
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    On September 20, 2017, the Government submitted a new Request for 
Final Agency Action. (Hereinafter, cited as RFFA). Therein, the 
Government represents that ``Registrant has not requested a hearing and 
has not otherwise corresponded or communicated with DEA regarding the 
Reissued Order served on him, including the filing of any written 
statement in lieu of a hearing.'' RFAA, at 2.
    Because more than 30 days have now passed since the date of service 
of the Show Cause Order and that Registrant has not submitted a request 
for a hearing or a written statement, I find that Registrant has waived 
his right to a hearing or to submit a written statement in lieu of a 
hearing. 21 CFR 1301.43(d). I therefore issue this Decision and Final 
Order based on relevant evidence contained in the record submitted by 
the Government. Id. Sec.  1301.43(d) & (e). I make the following 
findings of fact. Id. Sec.  1301.43(e).

Findings

    Registrant is the holder of DEA Certificate of Registration No. 
AD9639038, pursuant to which he is authorized to dispense controlled 
substances in schedules II through V as a practitioner, at the 
registered address of 2305 Southmore, Houston, Texas. GX 1 
(Certification of Registration History). He is also authorized to 
dispense Suboxone and Subutex as a Data-Waiver practitioner pursuant to 
the Drug Addiction Treatment Act of 2000 (DATA), for the purpose of 
treating up to 100 opiate-addicted patients. Id.; see 21 U.S.C. 
823(g)(2). His registration does not expire until June 30, 2018. Id.
    On October 12, 2016, the Texas Medical Board (Board) issued an 
Order of Suspension by Operation of Law, suspending Registrant's Texas 
Medical License No. F-8454, based on Registrant's felony conviction on 
March 30, 2016 for health care fraud in the U.S. District Court for the 
Southern District of Texas.\2\ GX 3, at 2. The Board found that on or 
about March 30, 2016, Registrant was convicted of one count of 
conspiracy to commit healthcare fraud, two counts of false statements 
related to healthcare matters, one count of conspiracy to pay and 
receive healthcare kickbacks, and one count of payment and receipt of 
healthcare kickbacks. Id. at 1-2 (citing 18 U.S.C. 1349, 1035, 371, 2; 
42 U.S.C. 1320a-7b(b)(1) and (b)(2)).
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    \2\ The Board's Disciplinary Panel issued the Order following a 
hearing on October 7, 2016, at which it considered the Board's 
Application for Suspension by Operation of Law. GX 3, at 1. While 
Registrant was provided with notice of the hearing, neither he nor 
his attorney appeared. Id.
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    The Government provided evidence that the Texas Medical Board Web 
site shows that Registrant's medical license remained suspended as of 
September 20, 2017, and according to the Board's Web site, his license 
remains suspended as of the date of this Decision and Order. GX 9. See 
also http://reg.tmb.state.tx.us/OnLineVerif/Phys_ReportVerif_new.asp. 
The Board's Order states that the suspension is to remain in effect 
until superseded by a subsequent Order of the Board. GX 3, at 2. I 
therefore find that Registrant does not possess authority to dispense 
controlled substances under the laws of Texas, the State in which he is 
registered with the Agency.

Discussion

    Pursuant to 21 U.S.C. 824(a)(3), the Attorney General is authorized 
to suspend or revoke a registration issued under section 823 of Title 
21, ``upon a finding that the registrant . . . has had his State 
license . . . suspended [or] revoked . . . by competent State authority 
and is no longer authorized by State law to engage in the . . . 
dispensing of controlled substances.'' With respect to a practitioner, 
DEA has long held that the possession of authority to dispense 
controlled substances under the laws of the State in which a 
practitioner engages in professional practice is a fundamental 
condition for obtaining and maintaining a registration. See, e.g., 
James L. Hooper, 76 FR 71371 (2011) (collecting cases), pet. for rev. 
denied, 481 Fed. Appx. 826 (4th Cir. 2012); see also Frederick 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.'').
    This rule derives from the text of two provisions of the CSA. 
First, Congress defined ``the term `practitioner' [to] mean[] a . . . 
physician . . . or other person licensed, registered or otherwise 
permitted, by . . . the jurisdiction in which he practices . . . to 
distribute, dispense, [or] administer . . . a controlled substance in 
the course of professional practice.'' 21 U.S.C. 802(21). Second, in 
setting the requirements for obtaining a practitioner's registration, 
Congress directed that ``[t]he Attorney General shall register 
practitioners . . . if the applicant is authorized to dispense . . . 
controlled substances under the laws of the State in which he 
practices.'' Id. Sec.  823(f). Because Congress has clearly mandated 
that a practitioner possess state authority in order to be deemed a 
practitioner under the Act, DEA has held repeatedly that revocation of 
a practitioner's registration is the appropriate sanction whenever he 
is no longer authorized to dispense controlled

[[Page 46527]]

substances under the laws of the State in which he practices medicine. 
See, e.g., Calvin Ramsey, 76 FR 20034, 20036 (2011); Sheran Arden 
Yeates, M.D., 71 FR 39130, 39131 (2006); Dominick A. Ricci, 58 FR 
51104, 51105 (1993); Bobby Watts, 53 FR 11919, 11920 (1988); see also 
Frederick Marsh Blanton, 43 FR 27616 (1978).
    Because Registrant is no longer currently authorized to dispense 
controlled substances in Texas, the State in which he is registered 
with the Agency, I will order that his registration be revoked.\3\ 21 
U.S.C. 824(a)(3).
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    \3\ The Show Cause Order also proposed revocation pursuant to 21 
U.S.C. 824(a)(5), which provides that a registration may be revoked 
``upon a finding that the registrant has been excluded or directed 
to be excluded from participation in a program pursuant to section 
1320a-7(a) of Title 42.'' GX 2, 1-2. While the Show Cause Order 
alleged that the HHS IG has issued a letter to Registrant excluding 
him from participation in federal health care programs pursuant to 
42 U.S.C. 1320a-7(a), the Government has provided no evidence to 
support the allegation, and it does not raise this ground in its 
Request for Final Agency Action. I therefore dismiss the allegation.
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Order

    Pursuant to the authority vested in me by 21 U.S.C. 824(a), as well 
as 28 CFR 0.100(b), I order that DEA Certificate of Registration 
AD9639038 and Data-Waiver Identification No. XD9639038, issued to 
Warren B. Dailey, M.D., be, and they hereby are, revoked. Pursuant to 
the authority vested in me by 21 U.S.C. 823(f), I further order that 
any pending application of Warren B. Dailey, M.D., to renew or modify 
his registration, be, and it hereby is, denied. This Order is effective 
November 6, 2017.

    Dated: September 27, 2017.
Chuck Rosenberg,
Acting Administrator.
[FR Doc. 2017-21382 Filed 10-4-17; 8:45 am]
 BILLING CODE 4410-09-P

Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Notices 46525 reviews. Comments are due on or before to Show Cause to Warren B. Dailey, either option. Id. (citing 21 CFR November 17, 2017 and may not contain M.D. (Registrant), of Houston, Texas. 1301.43). The Order also notified new factual information. Any person The Show Cause Order proposed the Registrant of his right to submit a that is neither a party to the five-year revocation of Registrant’s DEA corrective action plan under 21 U.S.C. reviews nor an interested party may Certificate of Registration, pursuant to 824(c)(2)(C). Id. at 3. submit a brief written statement (which 21 U.S.C. 824(a)(3) and (5), on two On February 7, 2017, the Show Cause shall not contain any new factual grounds: (1) That he does not have Order was mailed to Registrant, via first information) pertinent to the reviews by authority to handle controlled class mail, addressed to him at his November 17, 2017. However, should substances in Texas, the State in which registered address at 2305 Southmore, the Department of Commerce extend the he is registered with the Agency; and (2) Houston, Texas. GX 5. Affidavit of time limit for its completion of the final he has been excluded from participation Service by DEA Analyst, Office of Chief results of its reviews, the deadline for in a program pursuant to section 1320a– Counsel. Also, on February 21, 2016, a comments (which may not contain new 7(a) of Title 42. GX 2 (Order to Show Diversion Investigator (DI) with the factual information) on Commerce’s Cause), at 1. Houston Division Office emailed the final results is three business days after With respect to the Agency’s Show Cause Order to an attorney, who the issuance of Commerce’s results. If jurisdiction, the Show Cause Order represented Registrant in the state board comments contain business proprietary alleged that Registrant is registered as a proceeding, who accepted service on his information (BPI), they must conform practitioner in schedules II through V, behalf. GX 4. In his email, the attorney with the requirements of sections 201.6, under Certificate of Registration No. represented that he was ‘‘accepting 207.3, and 207.7 of the Commission’s AD9639038, at the registered address of service upon’’ Registrant. Id. (copy of rules. The Commission’s rules with 2305 Southmore, Houston, Texas. Id. email between DI and attorney respect to filing were revised effective The Order alleged that Registrant’s accepting service on Registrant.) July 25, 2014. See 79 FR 35920 (June 25, registration expires by its terms on June On April 6, 2017 the Government 2014), and the revised Commission 30, 2018. Id. forwarded a Request for Final Agency Handbook on E-filing, available from the As to the substantive grounds for the Action (RFAA) and an evidentiary Commission’s Web site at https:// proceeding, the Show Cause Order record to my Office. On review, I found www.usitc.gov/secretary/documents/ specifically alleged that ‘‘[o]n October the Government’s attempts at service handbook_on_filing_procedures.pdf. 12, 2016, the Texas Medical Board insufficient. As for the Government’s In accordance with sections 201.16(c) issued an Order of Suspension by attempt to serve Registrant by mail and 207.3 of the rules, each document Operation of Law, suspending addressed to his registered address, I filed by a party to the reviews must be [Registrant’s] Texas Medical License found this inadequate because it clearly . . . based on [his] felony conviction on knew that Registrant had been convicted served on all other parties to the reviews March 30, 2016 . . . for health care of multiple federal felony offenses more (as identified by either the public or BPI fraud.’’ Id. The Show Cause Order then than a year earlier and was likely service list), and a certificate of service alleged that Registrant is ‘‘currently incarcerated in a United States must be timely filed. The Secretary will without authority to practice medicine Penitentiary. See Robinson v. not accept a document for filing without or handle controlled substances in the Hanrahan, 409 U.S. 38, 40 (1972) a certificate of service. State of Texas, the [S]tate in which he (‘‘[T]he State knew that appellant was Determination.—The Commission has registered with’’ the Agency, thus not at the address to which the notice determined these reviews are subjecting his registration to revocation. was mailed . . . since he was at that extraordinarily complicated and Id. at (citing 21 U.S.C. 824(a)(3); other very time confined in . . . jail. Under therefore has determined to exercise its citations omitted). these circumstances, it cannot be said authority to extend the review period by The Show Cause Order also alleged that the State made any effort to provide up to 90 days pursuant to 19 U.S.C. that on December 30, 2016, the Office of notice which was ‘reasonably 1675(c)(5)(B). Inspector General, U.S. Department of calculated’ to apprise appellant of the Authority: These reviews are being Health and Human Services (HHS IG), pendency of the . . . proceedings.’’); see conducted under authority of title VII of issued a letter to Registrant ‘‘excluding also Jones v. Flowers, 547 U.S. 220, 230 the Tariff Act of 1930; this notice is [him] from participation in all Federal (2006) (citing with approval Robinson published pursuant to section 207.62 of health care programs based on [his] and noting that its cases ‘‘require[] the the Commission’s rules. felony conviction on March 30, 2016, in government to consider unique By order of the Commission. the U.S. District Court for the Southern information about an intended recipient Issued: September 29, 2017. District of Texas for health care fraud.’’ regardless of whether a statutory scheme Lisa R. Barton, Id. at 2. The Show Cause Order further is reasonably calculated to provided Secretary to the Commission. alleged that ‘‘[t]he exclusion was notice in the ordinary case’’). effective twenty days from the date of I also found the Government’s service [FR Doc. 2017–21429 Filed 10–4–17; 8:45 am] the letter and is for a minimum period on the attorney insufficient. In holding BILLING CODE 7020–02–P of twenty years.’’ Id. The Show Cause so, I explained that the CSA states that Order then asserted that Registrant’s ‘‘[b]efore taking action pursuant to [21 ‘‘DEA registration is also subject to U.S.C. 824(a)] . . . the Attorney General DEPARTMENT OF JUSTICE revocation based on [his] exclusion from shall serve upon the . . . registrant an participation in a program pursuant to order to show cause why registration Drug Enforcement Administration should not be . . . revoked[ ] or section 1320a–7(a) of Title 42.’’ Id. ethrower on DSK3G9T082PROD with NOTICES Warren B. Dailey, M.D.; Decision and (citing 21 U.S.C. 824(a)(5)). suspended.’’ 21 U.S.C. 824(c) (emphasis Order The Show Cause Order notified added). While I explained that the Registrant of his right to request a Agency has found that service on an On February 7, 2017, the Assistant hearing on the allegations, or to submit attorney may satisfy the CSA’s Administrator, Diversion Control a written statement in lieu of a hearing, requirement that a Show Cause Order be Division, Drug Enforcement the procedure for electing either option, ‘‘serve[d] upon the . . . registrant,’’ I Administration (DEA), issued an Order and the consequence for failing to elect noted that the Agency has made clear VerDate Sep<11>2014 19:52 Oct 04, 2017 Jkt 244001 PO 00000 Frm 00050 Fmt 4703 Sfmt 4703 E:\FR\FM\05OCN1.SGM 05OCN1

46526 Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Notices that ‘‘ [t]he mere relationship between a has not requested a hearing and has not 20, 2017, and according to the Board’s defendant and his attorney does not, in otherwise corresponded or Web site, his license remains suspended itself, convey authority to accept communicated with DEA regarding the as of the date of this Decision and service.’’ David M. Lewis, 78 FR 36951 Reissued Order served on him, Order. GX 9. See also http:// (2013) (quoting Harbinson v. including the filing of any written reg.tmb.state.tx.us/OnLineVerif/Phys_ Commonwealth of Virginia, 2010 WL statement in lieu of a hearing.’’ RFAA, ReportVerif_new.asp. The Board’s Order 3655980, at *9 (E.D. Va. Aug. 11, 2010) at 2. states that the suspension is to remain (quoting Davies v. Jobs & Adverts Because more than 30 days have now in effect until superseded by a Online, Gmbh, 94 F.Supp.2d 719, 722 passed since the date of service of the subsequent Order of the Board. GX 3, at (E.D. Va. 2000))). See also United States Show Cause Order and that Registrant 2. I therefore find that Registrant does v. Ziegler Bolt & Parts Co., 111 F.3d 878, has not submitted a request for a hearing not possess authority to dispense 881 (Fed. Cir. 1997); Grandbouche v. or a written statement, I find that controlled substances under the laws of Lovell, 913 F.2d 835, 837 (10th Cir. Registrant has waived his right to a Texas, the State in which he is 1990); Ransom v. Brennan, 437 F.2d hearing or to submit a written statement registered with the Agency. 513, 518–19 (5th Cir. 1971). ‘‘Rather, the in lieu of a hearing. 21 CFR 1301.43(d). I therefore issue this Decision and Final Discussion party seeking to establish the agency relationship must show ‘‘that the Order based on relevant evidence Pursuant to 21 U.S.C. 824(a)(3), the attorney exercised authority beyond the contained in the record submitted by Attorney General is authorized to attorney-client relationship, including the Government. Id. § 1301.43(d) & (e). suspend or revoke a registration issued the power to accept service.’’ I make the following findings of fact. Id. under section 823 of Title 21, ‘‘upon a Harbinson, 2010 WL 3655980, at * 9 § 1301.43(e). finding that the registrant . . . has had (quoting Davies, 94 F.Supp.2d at 722 his State license . . . suspended [or] Findings revoked . . . by competent State (quoting Ziegler, 111 F.3d at 881)). I further explained that while an Registrant is the holder of DEA authority and is no longer authorized by attorney’s authority to act as an agent for Certificate of Registration No. State law to engage in the . . . the acceptance of process ‘‘may be AD9639038, pursuant to which he is dispensing of controlled substances.’’ implied from surrounding authorized to dispense controlled With respect to a practitioner, DEA has circumstances indicating the intent of’’ substances in schedules II through V as long held that the possession of his client, In re Focus Media Inc., 387 a practitioner, at the registered address authority to dispense controlled F.3d 1077, 1082 (9th Cir. 2004) (other of 2305 Southmore, Houston, Texas. GX substances under the laws of the State citation and internal quotations 1 (Certification of Registration History). in which a practitioner engages in omitted), ‘‘an agent’s authority to act He is also authorized to dispense professional practice is a fundamental cannot be established solely from the Suboxone and Subutex as a Data-Waiver condition for obtaining and maintaining agent’s actions.’’ Id. at 1084. ‘‘Rather, practitioner pursuant to the Drug a registration. See, e.g., James L. Hooper, the authority must be established by an Addiction Treatment Act of 2000 76 FR 71371 (2011) (collecting cases), act of the principal.’’ Id. (citing FDIC v. (DATA), for the purpose of treating up pet. for rev. denied, 481 Fed. Appx. 826 Oaklawn Apartments, 959 F.2d 170, 175 to 100 opiate-addicted patients. Id.; see (4th Cir. 2012); see also Frederick Marsh (10th Cir. 1992)). Because the 21 U.S.C. 823(g)(2). His registration does Blanton, 43 FR 27616 (1978) (‘‘State Government offered no evidence of an not expire until June 30, 2018. Id. authorization to dispense or otherwise act by the Registrant establishing that he On October 12, 2016, the Texas handle controlled substances is a granted authority to the attorney to Medical Board (Board) issued an Order prerequisite to the issuance and accept process on his behalf in this of Suspension by Operation of Law, maintenance of a Federal controlled proceeding, I found that the suspending Registrant’s Texas Medical substances registration.’’). Government had not properly served License No. F–8454, based on This rule derives from the text of two Respondent. Focus Media, 387 F.3d at Registrant’s felony conviction on March provisions of the CSA. First, Congress 1084. 30, 2016 for health care fraud in the U.S. defined ‘‘the term ‘practitioner’ [to] Thereafter, the Government reissued District Court for the Southern District mean[] a . . . physician . . . or other the Show Cause Order and on July 17, of Texas.2 GX 3, at 2. The Board found person licensed, registered or otherwise 2017, a Diversion Investigator mailed that on or about March 30, 2016, permitted, by . . . the jurisdiction in the Order by certified mail addressed to Registrant was convicted of one count of which he practices . . . to distribute, Respondent, at the United States conspiracy to commit healthcare fraud, dispense, [or] administer . . . a Penitentiary in Beaumont, Texas.1 GX 7. two counts of false statements related to controlled substance in the course of According to the tracking information healthcare matters, one count of professional practice.’’ 21 U.S.C. obtained from the U.S. Postal Service, conspiracy to pay and receive 802(21). Second, in setting the on July 20, 2017, the mailing was healthcare kickbacks, and one count of requirements for obtaining a delivered to the Penitentiary. Id., see payment and receipt of healthcare practitioner’s registration, Congress also GX 8. I therefore find that the kickbacks. Id. at 1–2 (citing 18 U.S.C. directed that ‘‘[t]he Attorney General Government accomplished service on 1349, 1035, 371, 2; 42 U.S.C. 1320a– shall register practitioners . . . if the July 20, 2017. 7b(b)(1) and (b)(2)). applicant is authorized to dispense . . . On September 20, 2017, the The Government provided evidence controlled substances under the laws of Government submitted a new Request that the Texas Medical Board Web site the State in which he practices.’’ Id. for Final Agency Action. (Hereinafter, shows that Registrant’s medical license § 823(f). Because Congress has clearly ethrower on DSK3G9T082PROD with NOTICES cited as RFFA). Therein, the remained suspended as of September mandated that a practitioner possess Government represents that ‘‘Registrant state authority in order to be deemed a 2 The Board’s Disciplinary Panel issued the Order practitioner under the Act, DEA has 1 There is no evidence in the record as to how the following a hearing on October 7, 2016, at which held repeatedly that revocation of a DI obtained Registrant’s address. However, it considered the Board’s Application for according to the Bureau of Prisons Inmate Locator Suspension by Operation of Law. GX 3, at 1. While practitioner’s registration is the (of which I take official notice), Registrant is Registrant was provided with notice of the hearing, appropriate sanction whenever he is no incarcerated at USP Beaumont. See 5 U.S.C. 556(e). neither he nor his attorney appeared. Id. longer authorized to dispense controlled VerDate Sep<11>2014 19:52 Oct 04, 2017 Jkt 244001 PO 00000 Frm 00051 Fmt 4703 Sfmt 4703 E:\FR\FM\05OCN1.SGM 05OCN1

Federal Register / Vol. 82, No. 192 / Thursday, October 5, 2017 / Notices 46527 substances under the laws of the State been convicted of a felony relating to Order and to file any motion seeking to in which he practices medicine. See, controlled substances.’’ Show Cause terminate the proceeding ‘‘based on the e.g., Calvin Ramsey, 76 FR 20034, 20036 Order, at 1. timeliness of the . . . hearing request.’’ (2011); Sheran Arden Yeates, M.D., 71 As to the Agency’s jurisdiction, the Order for Prehearing Statements, at 1. FR 39130, 39131 (2006); Dominick A. Show Cause Order alleged that The ALJ directed the Government to Ricci, 58 FR 51104, 51105 (1993); Bobby Respondent is registered as a comply with this portion of his order by Watts, 53 FR 11919, 11920 (1988); see practitioner in schedules II through V, May 8, 2017. Id. The ALJ’s Order also also Frederick Marsh Blanton, 43 FR under Registration No. BO3937781, at directed both parties to file a prehearing 27616 (1978). the address of 49 Rolling Lane, statement setting forth their proposed Because Registrant is no longer Levittown, Pa. Id. The Order also witnesses, a summary of their proposed currently authorized to dispense alleged that Respondent’s registration testimony, and the documentary controlled substances in Texas, the State expires on December 31, 2017. Id. evidence they intended to introduce. Id. in which he is registered with the As to the substantive grounds for the at 1–2. Agency, I will order that his registration proceeding, the Show Cause Order On May 5, 2017, the Government be revoked.3 21 U.S.C. 824(a)(3). alleged that ‘‘[o]n June 28, 2016, submitted a pleading addressing the [Respondent was] convicted by a timeliness of Respondent’s hearing Order Federal jury of . . . two counts of request. Therein, the Government noted Pursuant to the authority vested in me conspiracy to distribute controlled that the envelope used by Respondent to by 21 U.S.C. 824(a), as well as 28 CFR substances, in violation of 21 U.S.C. mail the hearing request was stamped 0.100(b), I order that DEA Certificate of 846; 110 counts of distribution of by the Agency’s mailroom as having Registration AD9639038 and Data- controlled substances (oxycodone, been received on April 13, 2017. Notice Waiver Identification No. XD9639038, methadone and amphetamine, all of Service of Order to Show Cause, at 1. issued to Warren B. Dailey, M.D., be, [s]chedule II controlled substances), The Government therefore did not move and they hereby are, revoked. Pursuant seven counts of distribution of to terminate the proceeding based on to the authority vested in me by 21 controlled substances (alprazolam, a the timeliness of Respondent’s hearing U.S.C. 823(f), I further order that any [s]chedule IV controlled substances, in request. Id. at 1–2. pending application of Warren B. violation of 21 U.S.C. 841(a)(1); and one Also, on May 5, 2017, the Government Dailey, M.D., to renew or modify his count of distribution of controlled moved for summary disposition on two registration, be, and it hereby is, denied. substances resulting in death, in grounds. Mot. for Summ. Disp., at 1. This Order is effective November 6, violation of 21 U.S.C. 841(a)(1). Id. at 1– First, the Government noted that 2017. 2. The Show Cause Order also alleged subsequent to the issuance of the Show that on October 5, 2016, the judgment Cause Order, the State of Pennsylvania Dated: September 27, 2017. was entered against him. Id. at 2. The suspended Respondent’s license to Chuck Rosenberg, Order then asserted that a ‘‘[c]onviction practice osteopathic medicine and Acting Administrator. of a felony related to controlled surgery, and therefore, he has no [FR Doc. 2017–21382 Filed 10–4–17; 8:45 am] substances warrants revocation of [his] authority to handle controlled BILLING CODE 4410–09–P registration pursuant to 21 U.S.C. substances in the State in which he is 824(a)(2).’’ Id. registered. Id. at 2–4. As support for this The Show Cause Order notified contention, the Government submitted a DEPARTMENT OF JUSTICE Respondent of his right to request a copy of the State Board of Osteopathic hearing on the allegations or to submit Medicine’s Final Order of Automatic Drug Enforcement Administration a written statement while waiving his Suspension (April 12, 2017). GX 2. The [Docket No. 17–24] right to a hearing, the procedure for Government argued that because electing either option, and the Respondent does not have state William J. O’Brien, III, D.O.; Decision consequence of failing to elect either authority to dispense controlled and Order option. Id. The Show Cause Order also substances in Pennsylvania, he ‘‘is not notified Respondent of his right to authorized to possess a DEA registration On March 13, 2017, the Assistant submit a Corrective Action Plan in that [S]tate,’’ and therefore, his Administrator, Diversion Control pursuant to 21 U.S.C. 824(c)(2)(C). Id. at registration should be revoked. Mot. Division, issued an Order to Show 2–3. at 3. Cause to William J. O’Brien, III, D.O. On March 21, 2017, the Government The Government also sought (Respondent), formerly of Levittown, served the Show Cause Order on summary disposition on the ground that Pennsylvania. The Show Cause Order Respondent. Notice of Service of Order it is undisputed that Respondent has proposed the revocation of to Show Cause, at 1. On April 25, 2017, been convicted of a controlled substance Respondent’s DEA Certificate of Respondent’s hearing request was felony. The Government argued that Registration pursuant to 21 U.S.C. received by the Office of Administrative Respondent has been convicted of two 824(a)(2), on the ground that he ‘‘ha[s] Law Judges (OALJ) and assigned to ALJ counts of conspiracy to distribute 3 The Show Cause Order also proposed revocation Charles Wm. Dorman. Hearing Request, controlled substances, 110 counts of pursuant to 21 U.S.C. 824(a)(5), which provides that at 1. unlawful distribution of schedule II a registration may be revoked ‘‘upon a finding that On May 1, 2017, the ALJ issued an controlled substances, seven counts of the registrant has been excluded or directed to be Order for Prehearing Statements. Noting unlawful distribution of other excluded from participation in a program pursuant that Respondent’s hearing request was controlled substances, and one count of ethrower on DSK3G9T082PROD with NOTICES to section 1320a–7(a) of Title 42.’’ GX 2, 1–2. While the Show Cause Order alleged that the HHS IG has received on April 25, 2017 and that distribution of controlled substances issued a letter to Registrant excluding him from DEA’s regulation requires that a hearing resulting in death. Id. at 4 (citing 21 participation in federal health care programs request be received ‘‘within 30 days U.S.C. 841(a)(1) and 846). As support for pursuant to 42 U.S.C. 1320a–7(a), the Government after the date of receipt of the’’ Show this contention, the Government has provided no evidence to support the allegation, and it does not raise this ground in its Request for Cause Order to be deemed timely, the submitted a copy of the Amended Final Agency Action. I therefore dismiss the ALJ ordered the Government to ‘‘submit Judgment in a Criminal Case which was allegation. evidence showing when it served the’’ entered by the United States District VerDate Sep<11>2014 19:52 Oct 04, 2017 Jkt 244001 PO 00000 Frm 00052 Fmt 4703 Sfmt 4703 E:\FR\FM\05OCN1.SGM 05OCN1


Document Created: 2017-10-05 00:53:34
Document Modified: 2017-10-05 00:53:34
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
FR Citation82 FR 46525 
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