Registrant Actions - 2011
[Federal Register Volume 76, Number 147 (Monday, August 1, 2011)]
[Notices]
[Pages 45864-45867]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-19381]
DEPARTMENT OF JUSTICE
Drug Enforcement Administration
Shannon L. Gallentine, D.P.M.; Denial of Application
On June 25, 2010, the Deputy Assistant Administrator, Office of
Diversion Control, Drug Enforcement Administration, issued an Order to
Show Cause to Shannon Gallentine, D.P.M. (Respondent), of Maypearl,
Texas. The Show Cause Order proposed the denial of Respondent's pending
application for a DEA Certificate of Registration as a practitioner, on
the grounds that he had materially falsified his application and that
his "registration would be inconsistent with the public interest.''
Show Cause Order at 1 (citing 21 U.S.C. 824(a)(1) & 823 (f)).
With respect to the material falsification ground, the Show Cause
Order alleged that on October 1, 2007, Respondent had surrendered his
DEA registration. Show Cause Order at 1. The Order further alleged that
on July 16, 2009, Respondent had applied for a new DEA registration,
but had failed to disclose that he had surrendered his prior
registration. Id. The Order thus alleged that Respondent had materially
falsified his application by failing to disclose the surrender and that
this was ground to deny his application. Id. (citing 21 U.S.C.
824(a)(1)).
As for the public interest ground, the Show Cause Order alleged
that between various dates beginning in May 2004 through September
2007, Respondent prescribed controlled substances to six patients
(M.P., H.G., D.C., P.P., K.B., N.B.), "without a legitimate medical
purpose and/or outside the course of professional practice.'' Id. at 1-
2. The Order further alleged that on October 1, 2007, a federal search
warrant was executed at Respondent's registered location and that "no
records were found to adequately support the prescribing of control
substances to'' these patients. Id. at 2.
As evidenced by the signed return receipt card, on July 2, 2010,
the Show Cause Order, which also notified Respondent of his right to
request a hearing or to submit a written statement in lieu of a
hearing, the procedures for doing either, and the consequences for
failing to do either, was served on him. GX 4. Respondent did not,
however, file his request for a hearing \1\ with the Office of
Administrative Law Judges until August 5, 2010, which was three days \2\ after it was due. See GX 5, at 1; 21 CFR 1301.43(a); id. 1316.45.
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\1\ Respondent's request was dated August 2, 2010.
\2\ The thirty-day period for filing a request for a hearing
ended on August 1, 2010. However, because that day fell on a Sunday,
Respondent's request was not due until August 2, 2010, when the
Office of Administrative Law Judges was open for business.
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On August 12, 2010, the ALJ issued an order, a copy of which was
not included in the record submitted to this Office. However, based on
a subsequent order of the ALJ, it appears that the Government had
previously filed a motion to terminate, and that in the initial order,
the ALJ had provided Respondent with until August 23rd to file a
response to the Government's motion. See GX 7, at 1 (Order Adjusting
Deadlines for the Filing of Prehearing Statements).
On August 16, 2010, the Government moved to deny Respondent's
request for a hearing on the ground that it was untimely. GX 6.
Therein, the Government argued that the ALJ does not have jurisdiction
to grant a hearing when a hearing request is not timely filed, and that
in any event, Respondent had not established "good cause'' for his
untimely filing. Id. at 2.
On August 18, 2010, the ALJ issued a new order extending the
deadlines for each party to file its prehearing statement. GX 7, at 1
(Order Adjusting Deadlines for the Filing of Prehearing Statements).
On August 23, 2010, Respondent filed a "Motion To Establish
Proceedings.'' GX 8, at 2. Therein, Respondent stated that he did not
receive the Government's Motion to Terminate. Respondent further stated
that he had received the Order to Show Cause on July 2, 2010, and
asserted that he had "provided a timely request for hearing, dated
August 2, 2010.'' Id. Respondent further argued that because he did not
receive the Government's Motion to Terminate, he "was not given [an]
opportunity to respond to'' the Motion. Id.
On August 24, 2010, the ALJ issued an Amended Order Granting the
Government's Motion to Terminate Proceedings. See GX 10, at 1 (Order
Granting Respondent's Request To Stay Termination Of Proceedings And
Consenting To Allowance Of Interlocutory Appeal). However, two days
later, Respondent filed a Request To Stay Termination Of Proceedings.
Id. Therein, Respondent stated that he was "currently in bankruptcy
proceedings'' and was "unable to afford legal counsel.'' GX 9, at 1
(Request To Stay Termination Of Proceedings). Respondent further argued
that because he is not an attorney, he "understood the due date of the
request for hearing as needing to be dated within 30 days'' and
"pray[ed that] the court not terminate the proceedings.'' Id.
On August 30, 2010, the ALJ granted Respondent's request. Noting
that his ruling terminating the proceeding constituted a departure from
a prior Agency decision, the ALJ authorized Respondent to file an
interlocutory appeal of his Amended Termination Order. GX 10, at 1-2
(Order Granting Respondent's Request To State Termination Of
Proceedings And Consenting To Allowance Of Interlocutory Appeal)
(citing Garth A.A. Clark, M.D., 63 FR 54733 (1998)). The ALJ further
ordered that Respondent file his interlocutory appeal with my Office no
later than September 20, 2010; the ALJ also ordered that Respondent
serve a copy of his filing on him and Government counsel. Id. at 2 &
n.2.
Respondent did not, however, file an interlocutory appeal. Instead,
on September 20, 2010, Respondent filed a Request for Extension of Time
to File an Interlocutory Appeal [and] Request for Appointment of Legal
Counsel Due to Financial Hardship. GX 12. Therein, Respondent noted
that because he is not an attorney, he "does not know how to file an
interlocutory appeal,'' and sought the appointment of counsel "because
of the financial inability'' to retain counsel. Id. Respondent also
sought "an extension of time after appointment of legal counsel in
which to file an interlocutory appeal.'' Id.
Thereafter, the ALJ denied Respondent's motion for appointed
counsel, noting that he lacked authority to do so. GX 11, at 1-2 (Order
Denying Respondent's Request for An Extension Of Time To File An
Interlocutory Appeal And His Motion For Appointment Of Legal Counsel).
The ALJ also denied Respondent's request for an extension, noting that
the sole basis for it was to obtain appointed counsel. Id. The ALJ
further held that because Respondent had failed to file an
interlocutory appeal, the stay of the Amended Termination Order "ha[d]
expired by its own terms'' and the Order had "become[] immediately
effective.'' Id. at 2.
The Government then filed a Request for Final Agency Action with my
Office and submitted various documents as evidence in support of its
request. Having considered the record, I conclude that Respondent did
not submit a timely request for a hearing as required by 21 CFR
1301.43(a), and that he has not established good cause for his failure
to do so. Id. 1301.43(d). I therefore find that Respondent has waived
his right to a hearing. Id.
[[Page 45865]]
As to the merits, I find that Respondent materially falsified his
application for registration; I also find that Respondent's
registration "would be inconsistent with the public interest'' because
he issued numerous prescriptions for controlled substances which lacked
a legitimate medical purpose and thus violated 21 CFR 1306.04(a). 21
U.S.C. 823(f). Accordingly, Respondent's application will be denied. I
make the following findings of fact.
Findings
Respondent is a podiatrist licensed by the Texas State Board of
Podiatric Medical Examiners (TSBPME). Respondent previously held DEA
Certificate of Registration BG6902919, which authorized him to dispense
controlled substances in schedules II through V, as a practitioner, at
the registered location of 2700 Pleasant Run Road, Suite 360,
Lancaster, Texas.
According to the Affidavit of a DEA Diversion Investigator (DI), on
November 6, 2006, DEA received information from the TSBPME which
prompted it to investigate Respondent's prescribing practices. During
the course of the investigation, Respondent was found to have
authorized numerous prescriptions to six patients for narcotics such as
codeine with acetaminophen (apap) and hydrocodone/apap, both of which
are schedule III controlled substances. 21 CFR 1308.13(e)(1). More
specifically, the Investigators obtained records from various
pharmacies and found that Respondent had prescribed to: (1) M.P., a
total of 4,230 dosage units [hereinafter, d.u.] of codeine/apap from
January 3, 2005 through September 14, 2007; (2) H.G., a total of 3,180
d.u. of codeine 4/apap from May 29, 2004 through November 27,
2006; (3) D.C., a total of 2,260 d.u. of hydrocodone/apap from April 4,
2005 through September 18, 2007; (4) P.P., a total of 3,330 d.u. of
hydrocodone/apap from January 24, 2005 through January 9, 2007; (5)
K.B., a total of 1,500 d.u. of hydrocodone/apap from February 21, 2005
through December 4, 2006; (6) N.B., a total of 1,515 d.u. of
hydrocodone/apap from October 4, 2004 through May 3, 2006. GXs 13-18.
On October 1, 2007, federal and state Investigators executed a
search warrant at Respondent's registered location of 2700 Pleasant Run
Road, Suite 360, Lancaster, Texas. During the course of the search,
Respondent stated that no other person had access to his prescription
pad and that he personally signed all of his prescriptions. Respondent
also stated that he only prescribed hydrocodone to patients who had a
traumatic injury.
Moreover, of the six patients identified above, Respondent did not
have medical records for H.G., M.P., K.B., and N.B. While Respondent
had records for D.C. and P.P., the records for D.C. consisted largely
of billing records which listed various conditions and their
reimbursement codes, as well as progress notes which were blank except
for such information as the date, D.C.'s name, his date of birth, and
age. P.P.'s record also consisted largely of billing records and
progress notes. Moreover, only one of the progress notes (dated
February 19, 2007) documented that P.P. had a medical condition and had
pain.\3\
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\3\ The records for D.C. and P.P. also contained medication flow
sheets listing each patient's prescriptions and refills, some
prescriptions, as well as various refill authorization forms sent to
Respondent by the patient's pharmacy. For both D.C. and P.P., there
were no such records prior to 2007.
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Upon reviewing Respondent's records during the search, DEA
Investigators asked Respondent if he would voluntarily surrender his
DEA registration. Respondent agreed to do so and executed a form DEA-
104, Voluntary Surrender of Controlled Substances Privileges. GX 2, at
5. Therein, Respondent acknowledged that he was voluntarily
surrendering his Certificate of Registration, "[i]n view of [his]
alleged failure to comply with the Federal requirements pertaining to
controlled substances.'' Id. According to an Agency Investigator,
"Respondent was fully aware that the surrender of [his registration]
was based upon alleged violations of the Controlled Substances Act.''
Declaration of DI, at 4.
On July 14, 2009, Respondent applied for a new DEA registration. On
the application form, Respondent was required to answer four questions.
The second of these questions asked: "Has the applicant ever
surrendered (for cause) or had a federal controlled substance
registration revoked, suspended, restricted or denied, or is any such
action pending?'' Respondent entered "N'' for no.
Discussion
Section 303(f) of the Controlled Substances Act provides that an
application for a practitioner's registration may be denied upon a
determination "that the issuance of such registration would be
inconsistent with the public interest.'' 21 U.S.C. 823(f). In making
the public interest determination, the CSA requires the consideration
of the following factors:
(1) The recommendation of the appropriate State licensing board
or professional disciplinary authority.
(2) The applicant's experience in dispensing * * * 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.
"These factors are * * * considered in the disjunctive.'' Robert
A. Leslie, M.D., 68 FR 15227, 15230 (2003). I "may rely on any one or
a combination of factors, and may give each factor the weight [I]
deem[] appropriate in determining whether * * * an application for
registration [should be] denied.'' Id. Moreover, case law establishes
that I am "not required to make findings as to all of the factors.''
Hoxie v. DEA, 419 F.3d 477, 482 (6th Cir. 2005); see also Morall v.
DEA, 412 F.3d 165, 173-74 (2005).
Furthermore, under Section 304(a)(1), a registration may be revoked
or suspended "upon a finding that the registrant * * * has materially
falsified any application filed pursuant to or required by this
subchapter.'' 21 U.S.C. 824(a)(1). Under agency precedent, the various
grounds for revocation or suspension of an existing registration that
Congress enumerated in section 304(a), 21 U.S.C. 824(a), are also
properly considered in deciding whether to grant or deny an application
under section 303. See Anthony D. Funches, 64 FR 14267, 14268 (1999);
Alan R. Schankman, 63 FR 45260 (1998); Kuen H. Chen, 58 FR 65401, 65402
(1993).
Thus, the allegation that Respondent materially falsified his
application is properly considered in this proceeding. See Samuel S.
Jackson, 72 FR 23848, 23852 (2007). Just as materially falsifying an
application provides a basis for revoking an existing registration
without proof of any other misconduct, see 21 U.S.C. 824(a)(1), it also
provides an independent and adequate ground for denying an application.
Cf. Bobby Watts, M.D., 58 FR 46995 (1993).
The Material Falsification Allegation
As found above, on October 1, 2007, Respondent voluntarily
surrendered his registration upon being questioned by Investigators,
who were executing a search warrant, regarding whether he had adequate
documentation to support the controlled substance prescriptions he
issued to six patients. However, on
[[Page 45866]]
his July 14, 2009 application for a new DEA registration, in answering
the application's question which asked whether he had previously
surrendered for cause his DEA registration, Respondent answered "no.''
Respondent's answer was a material falsification of his
application. As the Supreme Court has explained, "[t]he most common
formulation'' of the concept of materiality "is that a concealment or
misrepresentation is material if it `has a natural tendency to
influence, or was capable of influencing, the decision of' the
decisionmaking body to which it was addressed.'' Kungys v. United
States, 485 U.S. 759, 770 (1988) (quoting Weinstock v. United States,
231 F.2d 699, 701 (D.C. Cir. 1956)) (other citation omitted); see also
United States v. Wells, 519 U.S. 482, 489 (1997) (quoting Kungys, 485
U.S. at 770). The evidence must be "clear, unequivocal, and
convincing.'' Kungys, 485 U.S. at 772. However, "the ultimate finding
of materiality turns on an interpretation of substantive law.'' Id. at
772 (int. quotations and other citation omitted).
DEA has previously held that "[t]he provision of truthful
information on applications is absolutely essential to effectuating
[the] statutory purpose'' of determining whether the granting of an
application is consistent with the public interest. See Peter H. Ahles,
71 FR 50097, 50098 (2006). More specifically, the public interest
inquiry under section 303(f) requires, inter alia, that the Agency
examine "[t]he applicant's experience in dispensing * * * controlled
substances,'' his "[c]ompliance with applicable State, Federal, or
local laws relating to controlled substances,'' and whether he has
committed other "conduct which may threaten public health and
safety.'' 21 U.S.C. 823(f). Because Respondent's voluntary surrender
was for cause and arose out of an investigation into whether he had
violated the Controlled Substance Act by issuing prescriptions outside
of the usual course of professional practice and which lacked a
legitimate medical purpose, 21 CFR 1306.04(a), his failure to disclose
the surrender was capable of influencing the Agency's evaluation of his
experience in dispensing controlled substances, his compliance with
Federal and State laws relating to controlled substances, and whether
he had engaged in other conduct which may threaten public health and
safety.
That the Agency did not rely on Respondent's false statement and
grant his application does not make the statement immaterial. As the
First Circuit has noted with respect to the material falsification
requirement under 18 U.S.C. 1001, "[i]t makes no difference that a
specific falsification did not exert influence so long as it had the
capacity to do so.'' United States v. Alemany Rivera, 781 F.2d 229, 234
(1st Cir. 1985). See also United States v. Norris, 749 F.2d 1116, 1121
(4th Cir. 1984) ("There is no requirement that the false statement
influence or effect the decisionmaking process of a department of the
United States Government.'').
I further conclude that Respondent's false statement cannot be
attributed to a good faith misunderstanding as to whether he had
surrendered his registration for cause (as he maintained in his letter
requesting a hearing). On the date he completed the application, less
than two years had passed since the search warrant was executed and
Respondent surrendered his registration. Given the circumstances of the
surrender, during which he was confronted with questions by the
Investigators about his prescribing practices and lack of documentation
to justify his prescriptions, Respondent cannot claim that he did not
surrender his registration for cause. Moreover, on the voluntary
surrender form, Respondent acknowledged that he was doing so "[i]n
view of [his] alleged failure to comply with the Federal requirements
pertaining to controlled substances.'' Accordingly, I conclude that
Respondent knew that he had surrendered his registration for cause and
that he knowingly materially falsified his July 14, 2009 application
for a new Certificate of Registration. This conclusion provides reason
alone to deny his application.
The Public Interest Grounds
Having considered all of the public interest factors, I conclude
that the evidence with respect to Respondent's experience in dispensing
controlled substances (factor two), his compliance with laws related to
controlled substances (factor four), and whether he has committed other
conduct which may threaten public health and safety (factor five)
establishes that Respondent's registration "would be inconsistent with
the public interest.'' \4\ 21 U.S.C. 823(f). This conclusion provides
an additional ground for denying Respondent's application.
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\4\ I acknowledge that the investigative record contains no
evidence that Respondent's state podiatrist's license or state
controlled substances registration (factor one) have been suspended
or revoked. However, DEA has long held that while possessing state
authority is a necessary condition for obtaining and maintaining a
DEA registration, the possession of state authority is not
dispositive of the public interest. See Mortimer B. Levin, D.O., 55
FR 8209, 8210 (1990). DEA has also held that the absence of a
criminal conviction of a Federal or State offense related to the
manufacture, distribution, or dispensing of a controlled substance
(factor three) is not dispositive. See Edmund Chein, M.D., 72 FR
6580, 6593 n.22 (2007).
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Under a longstanding DEA regulation, a prescription for a
controlled substance is not "effective'' unless it is "issued for a
legitimate medical purpose by an individual practitioner acting in the
usual course of his professional practice.'' 21 CFR 1306.04(a). This
regulation further provides that "an order purporting to be a
prescription issued not in the usual course of professional treatment *
* * is not a prescription within the meaning and intent of [21 U.S.C.
829] and * * * the person issuing it, shall be subject to the penalties
provided for violations of the provisions of law related to controlled
substances.'' Id. See also 21 U.S.C. 802(10) (defining the term
"dispense'' as meaning "to deliver a controlled substance to an
ultimate user by, or pursuant to the lawful order of, a practitioner,
including the prescribing and administering of a controlled
substance'') (emphasis added).
As the Supreme Court has explained, "the prescription requirement
* * * ensures patients use controlled substances under the supervision
of a doctor so as to prevent addiction and recreational abuse. As a
corollary, [it] also bars doctors from peddling to patients who crave
the drugs for those prohibited uses.'' Gonzales v. Oregon, 546 U.S.
243, 274 (2006) (citing United States v. Moore, 423 U.S. 122, 135, 143
(1975)). Under the CSA, it is fundamental that a practitioner must
establish and maintain a bonafide doctor-patient relationship in order
to act "in the usual course of * * * professional practice'' and to
issue a prescription for a "legitimate medical purpose.'' Laurence T.
McKinney, 73 FR 43260, 43265 n.22 (2008); see also Moore, 423 U.S. at
142-43 (noting that evidence established that physician "exceeded the
bounds of `professional practice,' '' when "he gave inadequate
physical examinations or none at all,'' "ignored the results of the
tests he did make,'' and "took no precautions against * * * misuse and
diversion''). The CSA, however, generally looks to state law to
determine whether a doctor and patient have established a bonafide
doctor-patient relationship. See Kamir Garces-Mejias, 72 FR 54931,
54935 (2007); United Prescription Services, Inc., 72 FR 50397, 50407-08
(2007).
Under the rules of the Texas State Board of Podiatric Medical
Examiners, "[a]ll podiatric physicians shall make, maintain, and keep
accurate records of
[[Page 45867]]
the diagnosis made and the treatment performed for and upon each of his
or her patients for reference and for protection of the patient for at
least five years following the completion of treatment.'' Tex. Admin
Code tit. 22, Sec. 375.21(a). When, however, Investigators executed
the search warrant at Respondent's registered location, Respondent did
not have any medical records for M.P., H.G., K.B., and N.B., even
though he had prescribed large quantities of codeine/apap to M.P.
(4,230 d.u.) and H.G. (3,180 d.u.) and large quantities of hydrocodone/
apap to K.B. (1,500 d.u.) and N.B. (1,515 d.u.). Moreover, Respondent
had prescribed to these persons for between a year and a half (in
N.B.'s case) and two and a half years (in M.P.'s case). Based on
Respondent's failure to maintain any medical records, let alone
document a diagnosis to support his prescribing of controlled
substances to M.P., H.G., K.B., and N.B., I conclude that Respondent
acted outside of the usual course of professional practice and lacked a
legitimate medical purpose when he prescribed controlled substances to
these patients and thus violated the CSA. 21 U.S.C. 841(a)(1); 21 CFR
1306.04(a). I also conclude that Respondent violated the Texas Board's
regulation requiring that he "make, maintain, and keep accurate
records of the diagnosis made and the treatment performed for'' each of
these patients. Tex. Admin Code tit. 22, Sec. 375.21(a).
As for D.C., while the Investigators found a medical record, the
progress notes did not document a diagnosis and contained no
information other than D.C.'s name, date of birth, his age, and the
date of the visit. Notwithstanding his failure to document a diagnosis,
Respondent issued D.C. prescriptions for 2,260 d.u. of hydrocodone/apap
over a nearly two and one half year period. Here again, I conclude that
Respondent acted outside of the usual course of professional practice
and lacked a legitimate medical purpose in prescribing hydrocodone/apap
to D.C. and violated the CSA in doing so. 21 U.S.C. 841(a)(1); 21 CFR
1306.04(a). Here too, Respondent also violated the Texas Board's rule.
While P.P.'s medical record contained a progress note documenting a
diagnosis, this note was dated February 19, 2007. However, Respondent
had prescribed hydrocodone/apap to her since February 2005, and had
authorized the dispensing of more than 3,300 dosage units to her before
he even documented a diagnosis. Here again, I conclude that these
prescriptions were issued outside of the usual course of professional
practice and lacked a legitimate medical purpose and thus violated the
CSA. 21 U.S.C. 841(a)(1); 21 CFR 1306.04(a). And here too, Respondent
violated the Board's rule by failing to document a diagnosis between
February 2005 and February 2007.
I therefore conclude that Respondent's experience in dispensing
controlled substances (factor two), his failure to comply with the
CSA's prescription requirement, 21 CFR 1306.04(a) (factor four) and his
failure to comply with the Texas Board's rule (factor five \5\),
establish that Respondent's registration "would be inconsistent with
the public interest.'' 21 U.S.C. 823(f). This conclusion provides an
additional and independent ground for denying Respondent's application.
Accordingly, Respondent's application for a new DEA Certificate of
Registration will be denied.
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\5\ As the Texas rule states, "All podiatric physicians shall
make, maintain, and keep accurate records of the diagnosis made and
the treatment performed for and upon each of his or her patients for
reference and for protection of the patient for at least five years
following the completion of treatment.'' Tex. Admin Code tit. 22,
Sec. 375.21(a). DEA has also held that a practitioner's failure to
maintain medical records required by state law constitutes such
other conduct which may threaten public health and safety. See
Robert L. Dougherty, 60 FR 55047, 55050-51 (1995).
The Government also asserts that Respondent materially falsified
his application for a state controlled substances registration
because he failed to disclose the surrender of his DEA registration.
Req. for Final Agency Action, at 14. This allegation was not,
however, made in the Order to Show Cause, and the ALJ's various
orders make clear that the Government did not file a Pre-Hearing
Statement, in which it might have provided the requisite notice. See
CBS Wholesale Distributors, 74 FR 36746, 36749-50 (2009); see also 5
U.S.C. Sec. 554(b) ("Persons entitled to notice of an agency
hearing shall be timely informed of * * * the matters of fact and
law asserted.''). I therefore do not consider it.
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Order
Pursuant to the authority vested in me by 21 U.S.C. 823(f), as well
as 28 CFR 0.100(b), I order that the application of Shannon L.
Gallentine, D.P.M., for a DEA Certificate of Registration as a
practitioner, be, and it hereby is, denied. This Order is effective
immediately.
Dated: July 22, 2011.
Michele M. Leonhart,
Administrator.
[FR Doc. 2011-19381 Filed 7-29-11; 8:45 am]
BILLING CODE 4410-09-P
NOTICE: This is an unofficial version. An official version of this publication may be obtained
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