[Federal Register Volume 61, Number 45 (Wednesday, March 6, 1996)]
[Notices]
[Pages 8973-8977]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-5141]
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DEPARTMENT OF JUSTICE
Drug Enforcement Administration
[Docket No. 94-34 and 92-78]
AML Corporation, d/b/a G & O Pharmacy, and G & O Pharmacy
Revocation of Registration
On July 23, 1992, the Deputy Assistant Administrator, Office of
Diversion Control, Drug Enforcement Administration (DEA), issued an
Order to Show Cause to G & O Pharmacy (Respondent), DEA Registration,
AG2999691, of Paducah, Kentucky, notifying it of an opportunity to show
cause as to why DEA should not revoke its DEA Certificate of
Registration, and deny any pending applications, under 21 U.S.C. 823(f)
and 824(a)(4), as being inconsistent with the public interest.
Specifically, the Order to Show Cause alleged in substance, that: (1)
in July 1990, an individual had overdosed on Demerol received from the
owner-manager pharmacist of the Respondent, Randall Lockhart, without
benefit of prescription; (2) accountability audits conducted of the
Respondent by DEA investigators in 1990 revealed shortages of Schedules
II and III controlled substances; (3) the Respondent had filled at
least 217 call-in prescriptions not authorized by the physicians whose
names appeared on the Respondent's records; and (4) at least one
individual, on multiple occasions, had received controlled substances
from Mr. Lockhart without seeing the physician listed on the call-in
prescriptions.
Respondent, through counsel, filed a timely request for a hearing,
and the case was docketed as G & O Pharmacy, Docket No. 92-78.
Following prehearing procedures, a hearing was held in Louisville,
Kentucky, on March 10 and 11, 1993. At the hearing, both parties called
witnesses to testify and introduced documentary evidence. After the
hearing, counsel for both parties submitted proposed findings of fact,
conclusions of law and argument.
Subsequently, on December 16, 1993, counsel for the Government
filed a motion to reopen the proceedings. The motion alleged that Mr.
Lockhart had transferred the ownership of Respondent G & O Pharmacy to
AML Corporation (AML). Further, the motion alleged that AML had applied
for and received a DEA registration, BA3838553, to operate the
Respondent, and that DEA had not been notified, pursuant to 21 CFR
1301.62 and 1307.14(b), that G & O Pharmacy had ceased doing business
under the previous ownership or that Mr. Lockhart had transferred
ownership to another entity. The Respondent did not answer the motion,
and on January 12, 1994, Administrative Law Judge Mary Ellen Bittner
issued an order reopening the proceedings in Docket No. 92-78.
On March 11, 1994, an Order to Show Cause was issued to AML d/b/a/
G & O Pharmacy, alleging that the Respondent's continued registration
was inconsistent with the public interest on the same basis as stated
in the July 1992 order in Docket No. 92-78, with the addition of the
allegation that Mr. Lockhart had improperly transferred ownership of
Respondent without notifying the DEA as required. The Respondent
requested a hearing, and on June 1, 1994, Judge Bittner issued an order
consolidating the two cases. On November 17, 1994, Judge Bittner
conducted a hearing in the consolidated proceedings in Louisville,
Kentucky. At this hearing, AML was represented by counsel, and both
parties called witnesses to testify and introduced documentary
evidence. Following the hearing, both the Government and the
Respondent, AML, filed further proposed findings of fact, conclusions
of law and argument.
On May 31, 1995, Judge Bittner issued her Opinion and Recommended
Ruling, recommending that the Respondent's DEA registration be revoked
and that any pending applications be denied. AML and G & O Pharmacy
filed exceptions to her opinion, and on July 17, 1995, the Government
filed a response to these exceptions. On July 19, 1995, Judge Bittner
transmitted the record of these proceedings and the
[[Page 8974]]
parties' filings to the Deputy Administrator.
The Deputy Administrator has considered the record and the filings
by the parties in their entirety, and pursuant to 21 CFR 1316.67,
hereby issues his final order based upon findings of fact and
conclusions of law as hereinafter set forth. The Deputy Administrator
adopts the Opinion and Recommended Ruling, Findings of Fact,
Conclusions of Law and Decision of the Administrative Law Judge, with
noted exceptions, and his adoption is in no manner diminished by any
recitation of facts, issues and conclusions herein, or of any failure
to mention a matter of fact or law.
The Deputy Administrator finds that the Respondent is a pharmacy in
Paducah, Kentucky. Randall Lockhart is a registered pharmacist in the
Commonwealth of Kentucky, and he has practiced pharmacy since 1959. His
wife, Cynthia Lockhart, is a registered nurse who worked at the
Respondent's location. In March or April of 1989, Mr. Lockhart bought a
50% ownership in Oehlschlaeger Corporation (Oehlschlaeger), owner of
the Respondent pharmacy, and in February of 1990, he bought the
remaining 50% ownership interest. Mr. Lockhart continued to work as the
pharmacist at G & O Pharmacy.
At the hearing before Judge Bittner, Mr. Lockhart testified that in
July 1990, he had received a telephone call from a local dentist
(Dentist), requesting injectable Demerol for a planned surgical
procedure he was to perform with the assistance of another dentist, Dr.
Heine. Mr. Lockhart further testified that he had told the calling
Dentist that he had twenty-four vials of Demerol on hand, but that he
would either have to write a prescription if the Demerol was for the
use of a single patient, or provide a DEA order form, if he wanted the
substance for general office use. Demerol is the brand name for
meperidine hydrochloride, a Schedule II controlled substance.
Although in dispute, Mr. Lockhart testified that the Dentist then
appeared at the pharmacy, gave Mrs. Lockhart what appeared to be a
prescription for Demerol, and obtained all twenty-four vials from the
pharmacy, telling Mrs. Lockhart that he would return the next day with
the requisite DEA order form. The next day, Mr. Lockhart called Dr.
Heine and requested that either he or the Dentist provide the required
paperwork for the transfer of the Demerol, and that Dr. Heine told him
that the Dentist was a drug addict, and that ``he wouldn't do a
surgical procedure with him in a 100 years.'' Mr. Lockhart testified
that that was the first time he had ever heard the Dentist referred to
as a drug addict. Mr. Lockhart then testified that, upon further
investigation, he found out that the Dentist was in a hospital
emergency room following an overdose.
Mr. Lockhart testified that he subsequently contacted the Inspector
of the Kentucky Board of Pharmacy (Kentucky Board) for advice, and that
the Inspector advised him to contact the DEA office in Louisville. Mr.
Lockhart wrote to the DEA, and following the DEA's advice, also wrote
to the Board of Dentistry concerning these events.
Paducah Police Department Officers (Officers) interviewed the
Dentist, who stated that he had not written the prescription Mr.
Lockhart had for the Demerol. The Dentist also stated that on fifteen
to twenty previous occasions he had received controlled substances from
Mr. Lockhart merely by asking, and that he had obtained ``basically
whatever I wanted [a]s long as it wasn't Schedule II.'' He also stated
that he had taken fictitious prescriptions for Percocet to Mr.
Lockhart, which he had filled. Percocet contains oxycodone, a Schedule
II controlled substance.
The Dentist also told the Officers that he had been a substance
abuser since 1985, and that he was sure Mr. Lockhart knew what he
intended to do with the drugs he obtained from the Respondent, although
he later stated that he had assumed Mr. Lockhart knew of his substance
abuse problem. However, at the hearing before Judge Bittner, Mr.
Lockhart denied knowing that the Dentist was a substance abuser at the
time of this incident.
A DEA diversion investigator (Investigator) testified that the
Paducah Police Department had advised him in September of 1990, of the
incident with the Dentist, and that on October 10, 1990, a DEA special
agent served a federal search warrant on the Respondent. Pursuant to
this warrant, DEA personnel seized controlled substance prescriptions
and other records.
The Investigator testified that he had used the seized records to
conduct an accountability audit of the Respondent's Schedule II
controlled substances for the period May 28, 1989, to October 10, 1990,
and for various Schedule III through V controlled substances for the
period May 1, 1989, through October 10, 1990. In her opinion, Judge
Bittner summarized the significant audit results, and the summaries
demonstrate that Mr.Lockhart had significant shortages of Dilaudid 4
mg., Meperidine, Mepergan Fortis, Valium 10 mg., APAP #3, Tylenol #3,
Lortab 5 mg. and 7.5 mg., and Didrex 50 mg., as well as a significant
overage of Demerol 100 mg.
Mr. Lockhart testified before Judge Bittner that he did not think
that the DEA audit accurately reflected shortages and overages, but
that he was unable to verify the numbers. He also testified that he had
not conducted an inventory when he had purchased an interest in the
Respondent pharmacy, and that there could have been shortages at that
time. The Inspector testified that Mr. Lockhart's records had been
seized in a search conducted by the Paducah police officers prior to
the DEA search, and that the Officers had not returned them. It is
undisputed that the Paducah police executed a search warrant for the
Respondent's controlled substance records in August 1990. However, Mr.
Lockhart did not indicate that he ever advised the DEA Investigator, at
either the time of the DEA search or audit, that G&O's records may have
been incomplete.
The Investigator testified that during the October 1990 search, he
had noticed that the Respondent had filled disproportionately more
call-in prescriptions than other pharmacies. Therefore, he obtained
copies of these prescriptions from the Respondent pharmacy. The
Investigator then interviewed the physicians (or their office
personnel) listed on the prescriptions to verify the authorization for
each prescription under review. In ten cases,the physician or office
personnel working for the physician, indicated that the person named on
the prescription was not his or her patient, and that patient records
were not maintained for that named individual. In total, the
Investigator testified that he was unable to verify approximately 198
prescriptions purportedly authorized by twenty different doctors. Many
of the prescriptions were dated after the time Mr. Lockhart became the
100 percent owner of the pharmacy. All of these prescriptions were
dispensed by either Mr. Lockhart or Mr. Oehlschlaeger, another
pharmacist and co-owner working at the Respondent pharmacy prior to Mr.
Lockhart's becoming the sole owner. Judge Bittner found the
Investigator's testimony credible.
However, Mr. Lockhart testified that all of the allegedly
unauthorized prescriptions were authorized, and that ``almost all [of
these unauthorized prescriptions were] what [amounted] to refill
prescriptions.'' He also testified that he had routinely received oral
prescriptions from the physicians who had denied authorizing the
prescriptions under review.
[[Page 8975]]
While the G&O Pharmacy case was pending, Mrs. Lockhart called the
Diversion Group Supervisor (Supervisor) at DEA's Louisville office to
express her concern about the Respondent's Certificate of Registration.
The Certificate was due to expire, and because of the pending
proceedings, a renewal certificate had not been issued. Mrs. Lockhart
feared suppliers would not fill orders because of the expired
certificate. The Supervisor advised Mrs. Lockhart that the registration
remained active on a day-to-day basis until a final order was issued by
the DEA. The Supervisor also offered to call the Respondent's suppliers
to explain the situation. Subsequently, the Investigator, a subordinate
of the Supervisor's, did call a supplier and an insurance company and
explained that the Respondent remained authorized to handle controlled
substances on a day-to-day basis.
On May 31, 1993, Mr. Lockhart executed a renewal application for
the respondent's Kentucky pharmacy license, listing Respondent's owner
as Oehlschlaeger with himself as the president, and Mrs. Lockhart as
the vice president, secretary, and treasurer. On August 11, 1993, Mr.
Lockhart executed a renewal application for the Respondent's DEA
registration. However, on October 4, 1993, Mrs. Lockhart executed
articles of incorporation for AML, listing its business address as the
same as the Respondent's, with herself as the incorporator. By letter
dated October 13, 1993, Mr. Lockhart advised the Pharmacy Board of the
transfer of ownership to AML with Mrs. Lockhart as the sole owner of
AML's stock.
Before Judge Bittner, Mrs. Lockhart testified that she and her
husband had talked about this transfer of ownership as early as in
1990, and that the primary reason for the transfer of ownership was Mr.
Lockhart's health. He had had coronary bypass surgery approximately 9
years prior, and they had both agreed that he should taper his
involvement in the business. However, Mr. Lockhart remained the primary
pharmacist. Mrs. Lockhart testified that she intended to hire another
pharmacist, but due to the uncertainty generated by these proceedings,
she had waited to add additional staff until she could provide
assurances of long-term employment. Mrs. Lockhart further testified
that she had formed a new corporation, rather than merely having her
husband transfer his stock from the prior corporation to her, because
she wanted a corporate name of her own. The record contains no
indication of how much money, if any, AML paid for the business.
On October 15, 1993, Mrs. Lockhart applied for a Kentucky pharmacy
license for the Respondent, noting the change of ownership, listing a
proposed acquisition date of October 26, 1993, and showing the
corporate owner as ``AML Corp. DBA G&O Pharmacy.'' She also listed
herself a President, Vice President, And Secretary/Treasurer, and her
husband as Pharmacist in Charge.
That same day, Mrs. Lockhart executed an application for a DEA
registration, listing herself as president of ``AML Corporation, doing
business as G&O Pharmacy,'' located at the same address as the
Respondent. AML was issued a Certificate of Registration, number
BA3838553, effective November 15, 1993, with an expiration date of June
30, 1996.
The Investigator testified before Judge Bittner that he had first
learned about the AML transaction on or about December 1, 1993, when
the Louisville DEA office received copies of DEA order forms dated
November 22, 1993, transferring Schedule II controlled substances from
``G&O Pharmarcy'' to AML. Mrs. Lockhart testified that she had mailed
the DEA order forms. She also testified that her husband had mailed to
the DEA the prior corporation's unused DEA order forms and the
Respondent's expired DEA Certificate of Registration. Although Mrs.
Lockhart testified that she had retrained possession of the return mail
receipts for both sets of documents, such receipts were not offered
into evidence and are not a part of the record. Further, the
Investigator testified that he have not personally received any unused
order forms from the Respondent, and that there was no record in his
office that the forms had been received. Further, the record contains
no other evidence to evidence to show that the unused order forms had
been received by the DEA or that the DEA has been advised of the
transfer of ownership of the Respondent as required by DEA regulations.
The Pharmacy Board Inspector testified that he had inspected the
Respondent approximately two to four times per year, and that after Mr.
Lockhart had become associated with the pharmacy, it had a ``clearner
and neater appearance,'' and its recordkeeping had improved. The
Inspector also testified that he had inspected the Respondent after AML
had become its owner, and that as far as he knew it was not cited for
any violations of Kentucky regulation and remained in good standing
with the Pharmacy Board. Further, Mrs. Lockart testified before Judge
Bittner, stating that the Respondent was an independent pharmacy, that
it was the only pharmacy in the area that compound medications, and
that physicians from a nearby hospital routinely called her husband to
obtain advice on how to prepare pediatric medications.
Pursuant to 21 CFR 1301.62 and 1301.63, the cessation of business
terminates a DEA registration, and a registrant is required to notify
the agency promptly and in writing if it ceases doing business. The
regulations also require a registrant intending to transfer its
business interests to another business entity to provide specified
information to the appropriate DEA Special Agency in Charge at least
fourteen days in advance of the proposed transfer. Also, pursuant to 21
CFR 1307.14(b), an inventory of all controlled substances must be taken
on the date of the transfer, but the regulation does not require filing
of the inventory with the DEA.
Further, pursuant to 21 U.S.C. 823(f) and 824(a)(4), the Deputy
Administrator may revoke a DEA Certificate of Registration if he
determines that the continued registration would be inconsistent with
the public interest. Section 823(f) requires that the following factors
be considered:
(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 appplicant'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 or
safety.
These factors are to be considered in the disjunctive; the Deputy
Administrator may rely on any one or a combination of factors and may
give each factor the weight he deems appropriate in determining whether
a registration should be revoked or an application for registration
denied. See Henry J. Schwarz, Jr., M.D., Docket No 88-42, 54 FR 16422
(1989)
In this case, the Deputy Administrator finds factors one, two,
four, and five relevant in determining whether the Respondent's
continued registration would be inconsistent with the public interest.
As to factor one, ``recommendation of the appropriate State licensing
board,'' per the Inspector's testimony, the Respondent AML's state
licenses are in order, and no adverse actions are pending.
[[Page 8976]]
As to factor two, the Respondent's ``experience in dispensing * * *
controlled substances,'' it has previously been found that the improper
filling of prescriptions by a pharmacist working in a pharmacy could
serve as a basis for revoking the DEA Certificate of Registration for
that pharmacy. See, e.g., Medic-Aid Pharmacy, Docket No, 89-12, 55 FR
30043 (1990). Also, the regulations implementing the Controlled
Substances Act specify that a prescription for a controlled substance
``shall be dated as of, and signed on, the day when issued and shall
bear the full name and address of the patient, the drug name, strength,
dosage form, quantity prescribed, directions for use, and the name,
address and registration number of the practitioner.'' 21 CFR
1306.05(a). Also, a pharmacist may dispense directly a Schedule II
controlled substance ``only pursuant to a written prescription signed
by the prescribing individual practitioner. * * *'' 21 CFR 1306.11(a).
The regulations also prohibit practitioners from issuing prescriptions
in order ``to obtain controlled substances for supplying the individual
practitioner for the purpose of general dispensing to patients.'' 21
CFR 1306.04(b).
It is undisputed that the document left by the Dentist when he took
the Demerol in July of 1990, even if he had, in fact, signed it and
left it with Mrs. Lockhart, would not have been an adequate document to
record the transfer of 24 dosage units of Demerol for in-office use.
However, the Deputy Administrator agrees with Judge Bittner's
conclusions regarding this incident, when she wrote:
Assuming arguendo, that Mr. Lockhart did not examine the
``prescription,'' and that neither of the Lockharts anticipated that
[the Dentist] would take the Demerol without leaving proper
documentation, this incident standing alone might not warrant
revoking [the] Respondent's DEA registration.
However, this incident does not stand alone, for the record
contains other evidence of Mr. Lockhart's dispensing practices.
Although Mr. Lockhart testified about flaws in the DEA audit,
especially following the Paducah Police search, Judge Bittner noted
that ``Mr. Lockhart apparently did not think it necessary to advise the
DEA auditors that his records might be incomplete, which prompts the
inference, which I make, that he was not seriously concerned about the
matter.'' Further, Judge Bittner found that ``[the] Respondent adduced
no persuasive evidence to explain the shortages.'' Rather, she noted,
and the Deputy Administrator concurs, that the evidence demonstrated
that the shortages were substantial, for ``some shortages of Schedule
III through V controlled substances were in the thousands of dosage
units, amounting to more than fifty percent of the total for which
[the] Respondent was accountable.'' The Deputy Administrator also
concurs with Judge Bittner's conclusion, that ``these shortages
constitute a basis for revoking [the] Respondent's DEA registration.''
See Val Gene Tatum, d/b/a/ Val's Pharmacy, 56 FR 16117 (1991), aff'd
sub nom Val G. Tatum v. DEA, 9th Cir. No. 91-70328 (January 16, 1992;
unpublished).
As for the evidence of unauthorized dispensing, the Investigator
testified that approximately 198 prescriptions were unauthorized, and
in 10 cases, he had interviewed doctors or their office personnel, who
had stated that the individuals named on the prescriptions were not
their patients. Although the Investigator's testimony concerning his
conversations with these medical personnel was hearsay, the Deputy
Administrator concurs with Judge Bittner's findings and conclusions as
to the reliability of this evidence: ``I find that the hearsay evidence
introduced through [the] Investigator [ ] is more reliable than Mr.
Lockhart's testimony, and therefore conclude that [the] Respondent
filled controlled substance prescriptions without authorization from
physicians. This conduct is further grounds for revoking [the]
Respondent's DEA registration.'' Also significant, and as noted by
Judge Bittner, Mr. Lockhart ``proffered no explanation as to why
various doctors denied authorizing the prescriptions at issue.''
As to factor four, the Respondent's ``[c]ompliance with applicable
State, Federal, or local laws relating to controlled substances,'' the
Deputy Administrator finds significant the Government's evidence of
noncompliance with DEA regulations by Mr. Lockhart when he transferred
ownership of G & O Pharmacy to AML. Specifically, 21 CFR 1305.14
states, in relevant part: ``If the registration of any purchaser
terminates (because the purchaser * * * ceases legal existence * * *) *
* * he shall return all unused order forms for [Schedules I and II]
substance[s] to the nearest office of the Administration.'' Although
Mrs. Lockhart testified that she believed Mr. Lockhart had sent unused
DEA order forms to the DEA via registered mail, AML's counsel did not
introduce the registered mail receipt, and the DEA Investigator
testified that such forms were not received by the DEA.
Furthermore, in this case, 21 CFR 1307.14(b) required Mr. Lockhart
to provide the Special Agent in Charge in his area specific information
at least 14 days in advance of the date of the proposed transfer of his
ownership in the pharmacy. Unrefuted evidence exists to establish that
Mr. Lockhart had failed to inform the DEA of his transfer of ownership
in compliance with this regulation.
The Deputy Administrator also takes into account Judge Bittner's
finding: ``Neither Mr. nor Mrs. Lockhart impressed me as credible
witnesses. Their testimony appeared tailored to suit [the] Respondent's
defenses rather than to accurately reflect relevant events. . . . In
contrast, Investigator [ ] appeared to be forthright and to exhibit
good recall, and I therefore credit [his] testimony.'' Thus, the Deputy
Administrator concludes that preponderating evidence exists to
establish that Mr. Lockhart failed to comply with the cited regulations
in effectuating the transfer of ownership of G & O Pharmacy.
As to factor five, ``[s]uch other conduct which may threaten the
public health or safety,'' the Deputy Administrator finds significant
the continued pattern of Mr. Lockhart's noncompliance with the
Controlled Substances Act and the implementing regulations.
Specifically, in neither hearing before Judge Bittner did Mr. Lockhart
present any evidence of his acknowledging past misconduct by taking
responsibility for (1) any of the documented shortages of controlled
substances; (2) his customer's having obtained controlled substances
without authorization from physicians; or (3) his failure to transfer
his ownership in the pharmacy in a manner which would have been in
compliance with DEA regulations. Mr. Lockhart's conduct fails to
reflect the acceptance of responsibility needed to continue as a
registered handler of controlled substances.
As for the transfer of ownership of the Respondent, Judge Bittner
wrote that ``the preponderance of the record establishes, and I find,
that the transfer * * * was not a bona fide transaction, but rather a
stratagem to obtain a new DEA registration.'' However, Mrs. Lockhart
testified about the efforts she made to insure AML was clearly a
distinct entity from Mr. Lockhart's corporation. Specifically, she
testified that on behalf of AML, she had opened a bank account,
obtained a federal employer tax identification number, procured
insurance for AML, and paid Mr. Lockhart a salary as an employee.
[[Page 8977]]
After reviewing this evidence, the Deputy Administrator has
determined that he need not make a finding as to the viability of this
ownership transaction. Even assuming, arguendo, that the transfer was a
bona fide transaction, revocation of AML's registration is still
appropriate. For, previously it has been found that revocation of the
DEA registration remained appropriate despite a transfer of ownership,
where there has been no change in the control exerted by the prior
pharmacist who had engaged in misconduct related to the dispensing of
controlled substances. Specifically, ``[t]he close connection between
the former and current owners leads the Administrator to believe that
the transfer has not, and will not, alter the way business is conducted
at the pharmacy.'' Absecon Pharmacy, Docket No. 88-76, 55 FR 9029
(1990). Here, the new owner, Mrs. Lockhart, is not a registered
pharmacist, is the wife of the former owner, and continues to employ
Mr. Lockhart as the ``Pharmacist in Charge.'' Mr. Lockhart continues to
hold unrestricted authorization to order and dispense controlled
substances. Further, AML did not provide any evidence to demonstrate
that any precautions had been taken to provide assurances that
controlled substances would not be improperly dispensed in the future
by Mr. Lockhart. The Deputy Administrator finds that the risk of
diversion by Mr. Lockhart remains, even though G & O Pharmacy is
currently under the ownership of AML. Since Mr. Lockhart remains the
primary pharmacist of the Respondent, his past misconduct continues to
justify the revocation of the Respondent's DEA Certificate of
Registration.
The Respondent AML raised several exceptions to Judge Bittner's
opinion. First, AML asserted that it was denied procedural due process
through the consolidation of the two cases, for AML argued that:
Due process requires that any denial, revocation, or suspension
of AML's registration be based upon the acts and omissions . . . of
AML, not a predecessor in interest to its business. Further,
fundamental due process requires that AML have notice and an
opportunity to confront witnesses and contest the grounds upon which
the government seeks to revoke its DEA certificate of registration.
4However, the Deputy Administrator notes that the Order to Show
Cause issued to AML Corporation on March 11, 1994, specifically set out
the allegations of Mr. Lockhart's acts of misconduct, mirroring the
notice given to G & O Pharmacy in July 0f 1992. By letter dated April
5, 1994, AML's counsel entered his appearance, requested a hearing, and
responded to the allegations in the show cause order paragraph by
paragraph. Thus, AML had notice of the acts which might constitute the
basis for revoking AML's registration.
Further, by order dated June 1, 1994, Judge Bittner ordered G & O's
counsel to provide AML's counsel copies of documents from the March
1993 hearing, and she ordered the Government to provide AML's counsel
exhibits and a copy of the transcript from that hearing. Judge Bittner,
concurrent with the June 1994 order, provided AML's counsel with copies
of the Administrative Law Judge's exhibits and the record to date in
the G & O case. Also, AML received a hearing, witnesses appeared, and
documentary evidence was received. AML thus received notice and had an
opportunity to confront witnesses and ``contest the grounds upon which
the government seeks to revoke its DEA Certificate of registration''.
The only reference in the record which even arguably could be
viewed as restricting AML's access to witnesses, was the following from
the hearing transcript of AML's proceedings:
[Judge Bittner]: My understanding is that we agreed this
morning, prior to the commencement of the hearing, that we weren't
going back into the prior case.
Mr. SHANNON: [AML's counsel] Yes, Judge. And I was just getting
ready to say I can probably obviate any of the objections. All I
want the record to reflect is that [the Investigator] conducted the
investigation of Oehlschlaeger, Inc., [.] AML Corporation was not
audited. They were not in existence.
The Deputy Administrator certainly is not conceding that AML was
denied an opportunity to confront and cross-examine witnesses from the
preceding hearing. However, even assuming arguendo, that AML's access
to witnesses was somehow restricted, on the record AML's counsel seems
to have affirmatively waived his right to ``go back into the prior
case,'' at the hearing before Judge Bittner. Thus, given the complete
record of AML's notice, opportunity and access to evidence, and AML's
own actions before Judge Bittner, the Deputy Administrator finds that
AML's procedural due process rights were not violated by the manner in
which these proceedings were conducted.
Further, AML objected to the fact that Judge Bittner did not
consider all factors listed in 21 U.S.C. 823(f). As has been previously
noted, the Deputy Administrator may review those factors in the
disjunctive, and he need not make a finding as to each factor. However,
as requested by AML, the Deputy Administrator notes that the record
contains no evidence to indicate that AML has been convicted of any
federal or state law violations. The remainder of AML's exceptions have
been previously addressed.
G & O Pharmacy also filed exceptions to Judge Bittner's opinion.
Specifically, G & O objected to Judge Bittner's placing reliance upon
the results of the DEA audit. The reliability of the audit results has
been addressed by the Deputy Administrator, and needs no further
comment here. Second, the Respondent G & O asserts that Judge Bittner
erred in admitting hearsay evidence during the administrative hearing.
However, since the Respondent's hearing was conducted in accordance
with applicable statutes and regulations, the Deputy Administrator
declines to adopt the Respondent's exceptions based upon his challenged
evidentiary rulings. See, e.g., Klinestiver v. Drug Enforcement
Administration, 606 F.2d 1128, 1129-30 (D.C. Cir. 1979); Gary E.
Stanford, M.D., No. 91-30, 58 Fed. Reg. 14,430 (1993). As to the
probative value, reliability, and ``fairness of its use,'' the Deputy
Administrator finds that Judge Bittner addressed these issues in her
opinion, that he concurs with her findings, and that no further comment
is required.
Therefore, after review of the entire record, the Deputy
Administrator finds that the public interest is best served by revoking
AML's Certificate of Registration. The Deputy Administrator notes that
pursuant to 21 CFR 1301.62, the transfer of ownership of G & O Pharmacy
to AML effectively terminated all authority granted under DEA
Certificate of Registration AG2999691, previously issued to G & O
Pharmacy. See 21 CFR 1301.62 and 1301.63. Accordingly, the Deputy
Administrator of the Drug Enforcement Administration, pursuant to the
authority vested in him by 21 U.S.C. 823 and 824, and 28 CFR 0.100(b)
and 0.104, hereby orders that DEA Certificate of Registration
BA3838553, previously issued to AML Corporation, is revoked and any
pending applications denied at this time. This order is effective April
5, 1996.
Dated: February 29, 1996.
Stephen H. Greene,
Deputy Administrator.
[FR Doc. 96-5141 Filed 3-5-96; 8:45 am]
BILLING CODE 4410-09-M
