*

After an examination of the briefs and the record, we have concluded that

oral argument is unnecessary. Thus, the appeal is submitted on the briefs and the

record. See Fed. R. App. P. 34(a)(2).

** Pursuant to Fed. R. App. P. 43(c), we have substituted Michael O. Leavitt

for Tommy G. Thompson as the named respondent. 

United States Court of Appeals

For the Seventh Circuit

Chicago, Illinois 60604

Submitted January 4, 2006*

Decided January 5, 2006

Before

Hon. RICHARD A. POSNER, Circuit Judge

Hon. DANIEL A. MANION, Circuit Judge

Hon. ILANA DIAMOND ROVNER, Circuit Judge 

No. 05-1077

BALDEV R. BHUTANI,

 Petitioner,

 v.

UNITED STATES FOOD AND

DRUG ADMINISTRATION and

MICHAEL O. LEAVITT,** Secretary,

Department of Health and Human

Services,

 Respondents. 

Petition for Review of an Order of the 

United States Food and Drug

Administration

UNPUBLISHED ORDER

Not to be cited per Circuit Rule 53
No. 05-1077 Page 2

O R D E R

Baldev Raj Bhutani, the former president of a generic drug manufacturing

company, petitions this court for review of a final order of the United States Food

and Drug Administration (“FDA”) permanently debarring him from rendering

services to persons with approved or pending drug applications. The debarment

resulted from Bhutani’s felony convictions for violating the Federal Food, Drug, and

Cosmetic Act (“FDCA”). We deny the petition.

In 1996 a jury found Bhutani guilty of seven felony offenses including six

counts of violating the FDCA, 21 U.S.C. §§ 331(a),(e),(k), and 333(a)(2), for, among

other things, introducing adulterated generic drug products into interstate

commerce from 1988 to 1989. After this court heard two appeals of Bhutani’s

criminal case, see United States v. Bhutani, 266 F.3d 661 (7th Cir. 2001), United

States v. Bhutani, 175 F.3d 572 (7th Cir. 1999), and while Bhutani was serving his

30 month sentence for his crimes, the FDA notified Bhutani in 2003 that it

proposed to debar him under the Generic Drug Enforcement Act (“GDEA”), 21

U.S.C. §§ 335a-335c. The GDEA was enacted in 1992, before Bhutani’s convictions

but several years after his criminal conduct. The GDEA mandates permanent

debarment for any individual “convicted of a felony under Federal law for

conduct . . . relating to the regulation of any drug product” under the FDCA. 

Id. § 335a(a)(2)(B). The FDA also informed Bhutani that he had an opportunity for

an evidentiary hearing if he presented specific facts demonstrating a genuine and

substantial issue of fact.

Under § 335a(a)(2)(B), the only fact relevant to Bhutani’s debarment was

whether he had been convicted of felonies for conduct related to the regulation of a

drug product under the FDCA. Because he acknowledged that he had qualifying

felony convictions, in December 2004 the FDA denied his request for an evidentiary

hearing. The agency also rejected Bhutani’s legal arguments that debarment was

unconstitutional and barred by equitable defenses. The FDA issued an order

permanently debarring Bhutani from “providing services in any capacity to a person

that has an approved or pending drug product application.” 21 U.S.C.

§ 335a(a)(2)(B); Baldev Raj Bhutani, 69 Fed. Reg. 70148 (Dep’t of Health and

Human Servs. and Food and Drug Admin. Dec. 2, 2004) (denial of hearing; final

debarment order). 

On appeal, Bhutani raises two constitutional issues: that his debarment

violates the Ex Post Facto and Double Jeopardy Clauses of the Constitution. These

are pure questions of law that we review de novo. See Bae v. Shalala, 44 F.3d 489,

492 (7th Cir. 1995). Bhutani argues that his debarment under § 335a(a)(2)(B)

violates the prohibition against ex post facto laws because the GDEA—the law

authorizing his debarment—was passed only after he had engaged in the conduct
No. 05-1077 Page 3

1 Bhutani also argues that the GDEA cannot be applied retroactively as a

matter of statutory construction. Because he did not expressly raise or develop the

issue of statutory construction before the FDA, we will not consider it here. See

Myron v. Chicoine, 678 F.2d 727, 731 (7th Cir. 1982) (collecting cases); see also

DiCola 77 F.3d at 506 n.* (by not raising the issue before the FDA, petitioner

waived appellate review of whether GDEA could be applied retroactively as a

matter of statutory law). 

giving rise to his FDCA felony convictions. But we have already held that

permanent debarment under such retroactive application of the GDEA does not

offend the Ex Post Facto Clause because debarment is a remedial, not punitive,

sanction. Bae, 44 F.3d at 496 (“The GDEA’s civil debarment penalty is solely

remedial,” so the ex post facto prohibition is inapplicable); see also DiCola v. FDA,

77 F.3d 504, 507 (D.C. Cir. 1996) (same).1

Bhutani next asserts that his debarment is prohibited by the Double

Jeopardy Clause because he has already been convicted and sentenced for his

conduct. But double jeopardy precludes only multiple criminal punishments, not

civil sanctions. See Hudson v. United States, 522 U.S. 93, 99 (1997). Determining

whether debarment is criminal or civil requires a two-step analysis. First, we look

to the statute to see if the legislature expressly or impliedly intended that the

sanction be criminal or civil. Id. Although § 335a(a)(2)(B) does not specifically

characterize debarment as civil, the Supreme Court has held that if authority to

debar is vested in an administrative agency (such as the FDA in this case), it “is

prima facie evidence that Congress intended to provide for a civil sanction.” 

Hudson, 522 U.S. at 103. Since Bhutani has offered nothing to rebut this prima

facie evidence, § 335a(a)(2)(B) is presumptively a civil sanction. 

Second, we examine whether there is the “clearest proof” that § 335a(a)(2)(B)

is nonetheless so punitive that it transforms what Congress deemed a civil sanction

into a criminal penalty. Hudson, 522 U.S. at 100. Because we held in Bae that

debarment is remedial, it is therefore neither punitive nor criminal. The Supreme

Court’s analysis in Hudson two years after Bae confirms this conclusion. Hudson

held that there was “little evidence” that a debarment sanction prohibiting further

participation in banking activities was so punitive as to transform the civil penalty

into a criminal penalty. The Court reasoned that debarment has not historically

been viewed as punishment, does not come into play only upon a finding of scienter,

and is not akin to imprisonment. Id. at 104. The Court also found that even though

the underlying conduct for imposing debarment might also be criminal, this alone

was not enough to make debarment criminally punitive. Id. at 105. Finally,

although debarment sanctions are meant to deter others from similar conduct—an

objective of criminal punishment—“deterrence may serve civil as well as criminal
No. 05-1077 Page 4

goals.” Id. (internal quotation and citation omitted). Under this authority,

Bhutani’s permanent occupational debarment under the GDEA is a civil sanction,

so double jeopardy is not offended. See DiCola, 77 F.3d at 507.

Bhutani raises other nonconstitutional issues which we can readily dispose

of. He claims that the FDA arbitrarily and capriciously failed to examine the

“exculpatory” evidence of the consent and voluntary agreements he made with the

FDA in 1991 to bring his drug product into compliance with the FDCA. He asserts

that the agreements are evidence that there was an “implied contract” in which the

FDA promised to forgo all future action against him and that the FDA should

therefore be “estopped” from debarring him. But the 1991 agreements do not state

or imply that the FDA promised to release Bhutani from additional remedial

sanctions in general, or debarment in particular. Indeed, these agreements are

understandably silent about debarment because the GDEA debarment provision

was not even enacted until 1992. 

Next, Bhutani argues that the FDA was arbitrary and capricious by not

considering the facts underlying his convictions, which he believes are mitigating. 

But these facts are irrelevant to debarment since the only issue under

§ 335a(a)(2)(B) is whether he had a prior felony conviction for violating the FDCA. 

“Congress adopted a bright-line rule excluding from the generic drug industry all

individuals with prior felony convictions relating to the approval or regulation of

any generic drug product.” Bae, 44 F.3d at 495. Bhutani’s related argument that

the FDA erred by not giving him a hearing fails for the same reason—the only issue

of material fact was whether Bhutani had been convicted of felonies for conduct

related to the regulation of a drug product under the FDCA, and since he admitted

that he was, a hearing was not required.

Bhutani next argues that the FDA should be barred from bringing suit under

the doctrine of laches because the agency took too long to initiate debarment

proceedings. He claims this delay prejudiced him because his “evidence” is now

stale. Laches bars an action only if the plaintiff’s delay in bringing suit is

unreasonable and if the delay “materially prejudices the defendant.” Smith v.

Caterpillar, Inc., 338 F.3d 730, 733 (7th Cir. 2003). But in this case, even if there

were an unreasonable delay and even assuming that laches can be invoked against

the federal government, see United States v. Administrative Enterprises, Inc., 46

F.3d 670, 672-73 (7th Cir. 1995), Bhutani can’t show he was prejudiced because the

only material issue is whether Bhutani had prior FDCA-related convictions. Since

he concedes the fact of these convictions, the absence of any other evidence is

immaterial and therefore nonprejudicial.

Finally, Bhutani contends that the FDA should have subjected him to fiveyear, as opposed to permanent, debarment. However, § 335a(c)(2)(A)(ii) mandates
No. 05-1077 Page 5

permanent debarment for individuals like Bhutani who are penalized under

§ 335a(a)(2). See 21 U.S.C. § 335a(c)(2)(A)(ii). Permanent debarment is therefore

both authorized and required. 

Accordingly, the petition for review is DENIED.