Opinion ID: 799257
Heading Depth: 3
Heading Rank: 1

Heading: Entrapment by Estoppel and Right to Due Process

Text: Though the precise nature of Mr. Bader's claims are unclear, he appears to contend that he was entrapped by the prosecution and by the district court, in violation of his Fifth Amendment right to due process. Specifically, Mr. Bader alleges that: (1) he relied upon the Supreme Court's ruling in Western States which held that the speech-related provisions of the FDAMA were unconstitutional, as well as on a district court's ruling that compounded drugs were not new drugs subject to inspection by the FDA in Medical Center Pharmacy v. Gonzales, 451 F.Supp.2d 854 (W.D.Tex.2006), vacated in part by Medical Center Pharmacy v. Mukasey, 536 F.3d 383 (5th Cir.2008) [18] ; (2) that the government nonetheless prosecuted him under the FDAMA; and (3) that the district court subsequently used [the] FDAMA to justify [his] conviction, Aplt. Opening Br. at 37-38. Mr. Bader also suggests that confusion in the legal landscape at the time that he engaged in the conduct for which he was charged precludes his conviction on due-process grounds. These claims are meritless. The defense of entrapment by estoppel is implicated where an agent of the government affirmatively misleads a party as to the state of the law and that party proceeds to act on the misrepresentation so that criminal prosecution of the actor implicates due process concerns under the Fifth and Fourteenth Amendments. United States v. Nichols, 21 F.3d 1016, 1018 (10th Cir.1994). In order to establish an entrapment-by-estoppel defense, a defendant must prove: (1) that there was an active misleading by a government agent; (2) that the defendant actually relied upon the agent's representation, which was reasonable in light of the identity of the agent, the point of law misrepresented, and the substance of the misrepresentation; and (3) that the government agent is one who is responsible for interpreting, administering, or enforcing the law defining the offense. United States v. Apperson, 441 F.3d 1162, 1204-05 (10th Cir.2006) (quoting United States v. Hardridge, 379 F.3d 1188, 1192 (10th Cir. 2004)) (internal quotation marks omitted). To the extent that Mr. Bader premises his estoppel claim upon federal court decisions, it fails at the outset. While this circuit has yet to explicitly address whether a court's ruling can give rise to a claim of estoppel, [19] the law is clear that the offending party must be a government official or agency.  United States v. Gutierrez-Gonzalez, 184 F.3d 1160, 1167 (10th Cir.1999) (emphasis added). A court is neither an official, nor for purposes of making allegedly misleading declarations of law would it customarily be understood to be an agency. Cf. United States v. Manning, 526 F.3d 611, 617-18 (10th Cir.2008) (discussing the codified judicial function exception to prosecution under 18 U.S.C. § 1001, which makes the statute inapplicable to false statements made to the court in its judicial capacity, rather than its administrative capacity). Furthermore, courts cannot be said to serve as an arm of the Executive Branchindeed, it is beyond peradventure that the separation of powers principles embodied in our Constitution forbid them from operating as such. Accordingly, any allegation that a court, as an entity, issued a decision inducing Mr. Bader to take a particular action is not one upon which an estoppel claim may stand. Mr. Bader's remaining estoppel claim against the prosecution fails at step one of the Apperson inquiry. See Apperson, 441 F.3d at 1204. Mr. Bader presents no evidence that any government official made any sort of active[ly] misleading statement with regard to the FDAMA; even if he had, his argument would be based upon a faulty premise. As the district court explained in its order denying Mr. Bader's motion to dismiss, the FDAMA is material to this case only as a defense belonging to Mr. Bader. Aplee. App., Vol. IV, at 1060 (emphasis removed). Under the FDAMA, 21 U.S.C. § 353a(a), a licensed pharmacist is exempt from federal liability where he compounds a drug product for an identified individual patient based on the unsolicited receipt of a valid prescription order or a notation, provided that certain conditions are met, id. The FDAMA therefore presents an affirmative defense that Mr. Bader might have asserted, not a charge that the government impermissibly sought. Thus, if anything, the FDAMA could have worked to Mr. Bader's advantagean advantage that was precluded by Mr. Bader's repeated averments that the FDAMA had no bearing upon his case. See Aplee. App., Vol. I, Tr. at 1-2. As Mr. Bader offers no evidence of active misleading let alone evidence of such conduct that might have prejudiced him at trialhis entrapment-by-estoppel claim is without merit. As for Mr. Bader's argument that due process confusion precluded [his] conviction, Aplt. Opening Br. at 39, although it is not entirely clear, Mr. Bader appears to argue that the confusion rendered in the wake of Western States and Medical Center Pharmacy failed to place him on notice that his compounding of HGH was subject to FDA oversight. In this regard, Mr. Bader asserts that [t]he courts told him [that] his pharmacy was compounding legally, id. at 37, and, based upon his survey of the legal landscape, he followed State law, the only law he knew to be applicable, id. at 39. This argument is misguided. With regard to Western States, by its terms, the Court's decision merely invalidated the FDAMA's speech-related provisions as they related to advertising; it did not address the FDAMA's substantive exemptions and accompanying restrictions with respect to compounding. See 535 U.S. at 366, 377, 122 S.Ct. 1497. Therefore, Mr. Bader could not have divined from the text of Western States that his compounding activities were free from substantive FDA regulation. [20] The district court's decision in Medical Center Pharmacy is also unavailing. In Medical Center Pharmacy, the district court concluded that any drugs created through the compounding process must be exempt from the new drug definitions of the FDCA. 451 F.Supp.2d at 864 (emphasis added). Mr. Bader's convictions on appeal, however, pertain to: (1) distribution of HGH for unauthorized use, in violation of 21 U.S.C. § 333(e); (2) knowingly importing HGH into the United States contrary to law, in violation of 18 U.S.C. § 545 and 21 U.S.C. § 355; and (3) conspiracy with intent to distribute and possess with intent to distribute testosterone cypionate, in violation of 21 U.S.C. § 841(a)(1), (b)(1)(D), and 21 U.S.C. § 846. Of these three groups of charges, only the second implicates new drug approval under the FDA and, as discussed above, those charges concern only the imported Genescience HGH as it existed before it was compounded by College Pharmacy. Consequently, Medical Center Pharmacy is inapposite. Moreover, as the district court correctly concluded, Mr. Bader misreads Medical Center Pharmacy 's actual holding. In Medical Center Pharmacy, the court found that subsections (a) and (c) of the FDAMA, 21 U.S.C. § 353a, were severable from the remainder of § 353a; consequently, pharmacies were still obligated to comply with subsection (b)'s requirements for compounded drugs. 451 F.Supp.2d at 863. In other words, the court's decision can be read as concluding that only drugs compounded in compliance with the restrictions set forth in [the] FDAMA fall outside [of] FDA regulation and the NDA process. Aplt.App., Vol. II, at 559 (emphasis removed). Furthermore, this exemption for compounded drugs from the new drug definition [was] limited to compounds which are made in reasonable quantities upon receipt of a valid prescription for an individual patient from a licensed practitioner.  451 F.Supp.2d. at 863 (emphases added). Indeed, the Medical Center Pharmacy court clarified that [d]rugs that are compounded in large quantities before a prescription is received from a doctor do not fall within [this] narrow exemption. Id. It is clear from the record that Mr. Bader's large-scale HGH compilation method fell outside the protective scope of this exemption. Specifically, Ms. Griffin's testimony regarding College Pharmacy's Somatropin prepackaged protocol indicated that College Pharmacy repackaged massive amounts of HGH as Somatropin long before it received individual prescriptions, and College Pharmacy's numerous advertisements extolling the anti-aging and body-building benefits of HGHin conjunction with its promotion of the drug at trade shows for those purposesclearly suggested that College Pharmacy prepared and actively marketed dosages of HGH on a massive scale. Thus, in sum, Medical Center Pharmacy is inapposite for at least two salient reasons: (1) it did not completely eviscerate the compounded drug NDA requirements as Mr. Bader suggests; and (2) its limited exception is not one under which Mr. Bader's charged conduct would fall. Accordingly, Mr. Bader's reliance upon Medical Center Pharmacy is misplaced, and the case cannot support his illusory due-process claim.