Court Opinion

ID: 9468460
Source: CourtListenerOpinion
Date Created: 2023-08-05 02:15:26.655138+00
Date Added: 2024-06-11T17:40:52.727434
License: Public Domain

HEANEY, Circuit Judge, with whom BRIGHT, Circuit Judge,
joins, dissenting.
Human biologies have been regulated since 1902 by a succession of agencies leading to what is now the Food and Drug Administration (FDA), and animal biologies have been regulated since 1913 by the Department of Agriculture (USDA).1 Throughout this period, animal biologies manufactured and distributed exclusively within a state (“intrastate” products)2 have been exempt from all federal regulation because they were exempted by Congress from the USDA’s jurisdiction. See Animal Health Inst. v. USDA, 487 F.Supp. 376 (D.Colo.1980). The FDA for the first time now claims jurisdiction over such intrastate products, asserting latent statutory authority which has laid dormant for more than seventy years. Although we share the majority’s belief that all animal biologies should be subject to federal regulation, we cannot find authority for the FDA to claim jurisdiction over those that only flow in intrastate commerce. The jurisdiction principle transcends any consideration of our personal preferences — the FDA cannot invoke regulatory jurisdiction that Congress has exclusively conferred upon another agency. Moreover, the practical result of the majority’s decision appears so unreasonable that no Congress could have intended it — one agency with nearly seventy years of experience regulating animal biologies will *1293continue to regulate such products in interstate commerce, while a separate agency will now develop and duplicate the same expertise in order to regulate the same products as they move in intrastate commerce. Our shared desire to see the intrastate animal biologies regulated by the federal government cannot outweigh the plain intent of Congress nor the common sense of sound public administration. We therefore dissent.
I.
As the majority emphasizes, animal biologies come within the definition of “drug” in the Food, Drug and Cosmetic Act (FDCA) and, therefore, nominally come within the FDA’s jurisdiction. Supra at 1289, 1290. It is clear that the facial scope of the FDCA reaches animal biologies in both interstate and intrastate commerce. Id. A literal application of the FDCA, however, must account for section 902(c) of the Act, now codified, as amended, at 21 U.S.C. § 392(b), which the majority acknowledges but which bears repeating here:
(b) Nothing contained in this chapter shall be construed as in any way affecting, modifying, repealing, or superseding the provisions of section 262 of Title 42 (relating to viruses, serums, toxins, and analogous products applicable to man); the virus, serum, toxin, and analogous products provisions, applicable to domestic animals, of the Act of Congress approved March 4, 1913; the Filled Cheese Act of June 6, 1896, the Filled Milk Act of March 4, 1923; or the Import Milk Act of February 15, 1927. [Emphasis added.] The 1913 Act that the FDCA shall not
“affect or modify” is the Virus-Serum-Toxin Act of 1913 (VSTA), which confers upon the USDA jurisdiction over animal biologies. Both the district court and the Circuit Court panel read this “shall not affect” language as affirming the status quo— which since 1913 has meant animal biologies are regulated exclusively by the USDA.3 The FDA contends, and the majority now agrees, that the VSTA will not be “affected or modified” if the FDA regulates intrastate animal biologies because such products have always been exempt from the USDA’s jurisdiction under that Act. Supra at 1290-1292. When Congress provides that the VSTA shall govern animal biologies and that the FDCA “shall not affect” the VSTA, it seems plain to us that the FDCA cannot be authority to regulate what the VSTA exempts. Indeed, the “shall not affect” language is a restriction on FDA jurisdiction, not a grant of authority. Even more persuasive is the fact that the FDA’s contention is contrary to the legislative history on this question, to the FDA’s prior longstanding interpretation of its jurisdiction and to the only case law construing the intent of Congress with respect to animal biologies.
The FDA’s claim of authority arises from the jurisdictional definition of “drug” in the Pure Food and Drug Act of 1906. Supra at 1289, 1290. Although animal biologies were in use at the time the 1906 Act was adopted, the FDA can point to nothing in the legislative history of that Act which addresses regulation of such produets. Moreover, if Congress intended the 1906 Act to encompass such products, there would have been no need to pass a separate, independent animal biologies act just seven years later — the VSTA of 1913 which confers jurisdiction upon the USDA for such regulation. Cf., Teamsters v. Daniel, 439 U.S. 551, 569-570, 99 S.Ct. 791, 801-802, 58 L.Ed.2d 808 (1979). A simple amendment to the 1906 Act, or even no legislative clarification at all, might be consistent with the FDA’s assertion of jurisdiction, but passage of a wholly independent act providing separate treatment of such products flatly contradicts the agency’s contention. The majority considers this legislative history a source of “unanswered questions,” supra at 1291, 1292, but it actually provides one clear answer: Congress intended animal biologies to be regulated exclusively pursuant to the 1913 VSTA and not the 1906 Act on which the FDA now relies.
*1294The longstanding jurisdictional interpretation by the FDA also clashes with its current claim. Since 1938, the FDA has acknowledged in regulations that animal biologies subject to VSTA “shall not be deemed subject” to the drug provisions of the FDCA. 3 Fed.Reg. 1847 § 1.02 (1938); 21 Fed.Reg. 5577 § 130.2 (1956). Even the FDA’s regulations dealing with enforcement actions do not explicitly include animal biologies within their scope. For example, 21 C.F.R. § 7.1(f) (1980) defines products to include “an article subject to the jurisdiction of the Food and Drug Administration, including any food, drug, and device intended for human or animal use, any cosmetic and biologic intended for human use, * * (Emphasis added.) If the FDA considered all biologies, both animal and human, to be within its jurisdiction, there would have been no need to modify the term biologic by the phrase “intended for human use.” Not until 1979 did the FDA, through litigation, attempt to assert any jurisdictional authority over animal biologies.
In addition, the only reported case construing the legislative intent of VSTA flatly contradicts the FDA’s contention. In Animal Health Inst. v. USDA, 487 F.Supp. 376 (D.Colo.1980), the court rejected the claim of a private party that sought to compel the USDA to regulate intrastate animal biologies. The majority cites this case as authority that the USDA cannot regulate such intrastate products, supra at 1289, 1290, but ignores the essential rationale on which that decision relied. The court in Animal Health ruled that Congress specifically intended to exempt intrastate animal biologies from regulation, noting a long line of USDA administrative decisions in accord with that intent.4 To permit the FDA to now assert the same jurisdiction wholly negates the intent of Congress. Moreover, such congressional intent underlying the VSTA exemption removes any reasonable doubt concerning section 902(c) of the FDCA —by declaring in section 902(c) that the FDCA shall not “affect or modify” the VSTA, Congress could hardly have intended a change removing VSTA’s exemption for intrastate products.
To conclude that Congress intended for exclusive USDA jurisdiction seems inescapable from the foregoing legislative history, administrative practice and judicial precedent.
II.
Perhaps most compelling are the practical results of permitting FDA jurisdiction in this case, results which appear to be “so manifestly unreasonable that they could not be attributed to congressional design * *.” United States v. Rutherford, 442 U.S. 544, 555, 99 S.Ct. 2470, 2477, 61 L.Ed.2d 68 (1979). Indeed, the majority concedes that the results may be “illogical,” “not symmetrical,” and “anomalous.” Supra at 1290-1292. The consequence of the majority’s decision is that the FDA will have exclusive jurisdiction over animal biologies manufactured and distributed within a state’s borders and the USDA will have exclusive jurisdiction .over the very same products when they cross a state’s borders. Thus, two agencies must develop duplicative expertise, train personnel for identical functions, and route inspectors along the same geographic paths — all to regulate products that are only distinguishable by their point of destination. It is difficult to imagine that Congress intended this result when it conferred jurisdiction over the interstate products upon the USDA and exempted the intrastate products from regulation.
In the face of legislative history, prior FDA determinations, judicial precedent and administrative common sense all weighing *1295in favor of exclusive USDA jurisdiction, the majority turns to the “broad remedial purpose” of the FDCA to find authority for FDA jurisdiction, relying on United States v. An Article of Drug . . . Bacto-Unidisk . . ., supra at 1290-1291. We agree that the FDCA has such a broad purpose and that the Act should be liberally construed to further that purpose. Bacto-Unidisk and the policy it espouses, however, simply do not apply to the present case. As the majority notes, the product involved in Bacto-Unidisk would either be deemed a “drug” or a “device” within the definition of the FDCA. Supra at 1290,1291. Although the degree of FDA regulation would be more stringent if the product was deemed a “drug,” the FDA would clearly have jurisdiction regardless of the definition the product fell under. Here, the question is whether the FDA has any jurisdiction in light of the express grant of authority to the USDA over animal biologies and the express restriction on the FDCA’s scope. We cannot accept the conclusion that the general purpose behind a statute provides so sweeping a source of authority that it could outweigh an express restriction imposed within the same statute.
The majority properly notes that Congress has the power to overrule this Court, but then indicates that the risk of congressional inertia should fall on those that would resist federal regulation. Supra at 1291, 1292. This sentiment seems misplaced in the present context. It is axiomatic that a regulatory agency has the authority and only such authority as may be conferred upon it by Congress. Where, as here, Congress has granted exclusive jurisdiction to another agency and has chosen to exempt altogether some element of that jurisdiction, there is no “risk of inertia” for courts to allocate — there simply is no authority to regulate the exempted subject matter.
It should be noted that denying the FDA’s claim of jurisdiction would not render intrastate biologies free of all regulation, as the majority implies. Supra at 1291, 1292. The State of South Dakota has a comprehensive statutory framework that defines the permissible bounds for manufacturing, labeling and distributing a broad range of animal remedies. See S.D.Code §§ 39-18-1 to 39-18-53 (1980).5
The Congress thus is free to confer intrastate jurisdiction upon the USDA, or even upon the FDA, or to leave such matters in the hands of state authorities as it has since 1913. In any case, because Congress has spoken once, it is for that institution, not the courts, to formulate any new regulatory arrangement.

. The district court decision by Judge Nichol sets forth an excellent summary of the complex administrative history of this regulatory subject. See 488 F.Supp. 618, 621-626 (D.S.D. 1980).

. One ingredient of the animal biologies at issue in this case appears to be shipped in interstate commerce, which is necessary to the FDA’s asserted jurisdiction. The biologies are nonetheless deemed “intrastate” to reflect the basis for their exemption from USDA jurisdiction. See supra at 1289-1290.

. See Grand Labs., Inc. v. Harris, 488 F.Supp. 618 (D.S.D.1980); Grand Labs., Inc. v. Harris, 644 F.2d 729 (8th Cir. 1981) (Judge Arnold dissenting).

. Although the court found the legislative history of VSTA to be “extremely sparse,” it ruled that such history was “supportive of the view that Congress did not intend to require licensing of manufacturers who confine their activities to one state.” Animal Health Inst. v. USDA, 487 F.Supp. 376, 378 (D.Colo.1980). After noting that the USDA has, since 1913, interpreted the VSTA as exempting intrastate animal biologies, the court indicated that such an interpretation “is consistent with the literal meaning of [the Act and] follows the intent of Congress.” Id., at 379.

. The record before us, however, does not reveal the extent of enforcement activity at the state level.