Court Opinion

ID: 7709
Source: CourtListenerOpinion
Date Created: 2010-04-25 05:30:37+00
Date Added: 2024-06-11T09:37:59.496545
License: Public Domain

United States Court of Appeals,

                                   Fifth Circuit.

                                   No. 94-30389.

              UNITED STATES of America, Plaintiff-Appellant,

                                         v.

                    FOOD, 2,998 CASES, etc., Defendant.

               First Phoenix Group, Ltd., Claimant-Appellee.

                                  Sept. 26, 1995.

Appeal from the United States District Court for the Eastern
District of Louisiana.

Before WOOD, Jr.,* JOLLY and DeMOSS, Circuit Judges.

     E. GRADY JOLLY, Circuit Judge:

     This appeal presents complex, difficult, and close questions.

It is, however, a case that is unlikely to arouse widespread

passion.

     The case begins with an import alert for mushrooms canned in

China    and     falsely    bearing     the   labels   of     certain   Taiwanese

manufacturers.            Based    on   the   alert,    the     Food    and   Drug

Administration (the "FDA") detained two shipments of mushrooms

owned    by    appellee    First    Phoenix   Group    Limited,    Inc.   ("First

Phoenix").       The question that drives this appeal is what is to be

done with these mushrooms now that they have been detained by the

Customs Service at the port of entry;           First Phoenix argues that it

     *
      Circuit Judge of the Seventh Circuit, sitting by
designation.

                                          1
is entitled to "reexport"1 them, and the FDA argues that it has the

authority to destroy them.    The FDA filed a complaint in the United

States District Court for the Eastern District of Louisiana,

asserting authority to destroy the mushrooms under 21 U.S.C. § 334

of the Federal Food, Drug, and Cosmetic Act (the "FDCA").        First

Phoenix argued that when imported goods are detained at the port of

entry, the FDA could invoke only the administrative procedures

under 21 U.S.C. § 381 of the FDCA to refuse entry of the goods into

the United States and then allow First Phoenix ninety days to

"reexport" the mushrooms before the FDA could destroy them.          The

district court agreed and dismissed the FDA's complaint.             The

resolution of whether the district court erred in dismissing the

complaint depends upon whether the mushrooms were ever "introduced

into interstate commerce" within the expansive definition contained

in the FDCA;   and, second, upon whether, in the statutory scheme,

Congress intended that § 334 judicial proceedings could be invoked

only after the goods had been released from the Customs Service.

     We   conclude,   given   the   broad   statutory   definition    of

interstate commerce, that the mushrooms were in interstate commerce

and that neither the plain words of the statute nor congressional

intent behind the statute bars FDA's proceeding under § 334 in this

case.

                                    I

     1
      This inside term is somewhat misleading. When imported
goods have been refused admission into the United States,
"reexport" is a convenient term describing the opportunity given
to the importer to send these goods out of the United States.

                                    2
     In October 1989, the Food and Drug Administration (the "FDA")

issued an "import alert"2 for all canned mushrooms processed in

China in response to a food-borne illness caused by staphylococcal

enterotoxin found in canned mushrooms produced in nine China

factories.     Appellee First Phoenix Group Limited, Inc. ("First

Phoenix"), an importer of food products, purchased several orders

of canned mushrooms supposedly packaged at Hwa Chen Industrial

Corporation ("Hwa Chen") in Taiwan.                In late spring 1992, First

Phoenix attempted to enter two shipments of mushrooms—3,000 cases

and 6,000 cases—into the United States.               The 3,000-case shipment

was unloaded at Savannah, Georgia, transported under a United

States Customs Service transit bond to a bonded warehouse in Tampa,

Florida, and offered for entry on May 26, 1992.               The United States

Customs Service (the "Customs Service") conditionally released

these    mushrooms    under   bond   pending       review   by   the    FDA.    The

mushrooms then were shipped to a bonded warehouse in New Orleans,

Louisiana,    the    destination     city    for    each    shipment,    and   have

remained in    this    warehouse     since    this    time.      The    6,000-case

shipment was unloaded at Long Beach, California, in early July

1992, transported under a Customs Service transit bond to a bonded

warehouse in New Orleans, and offered for entry on behalf of First

Phoenix by Transoceanic Shipping.

     On July 10, 1992, the FDA issued a second import alert

     2
      An import alert advises FDA field offices of ongoing
problems with a specific product offered for import and suggests
appropriate action, such as detention for inspection and
sampling.

                                       3
advising its field offices to detain shipments of canned mushrooms

from specified Taiwanese manufactures, including Hwa Chen. The FDA

issued this import alert because mushrooms labelled as packaged and

produced from these specified manufacturers actually were processed

and packaged in an unknown factory in China.            Because of this

import alert, the FDA issued Notices of Detention and Hearing for

the 3,000-case shipment on July 29, and for the 6,000-case shipment

on December 14.3   In these notices, the FDA indicated that it was

acting under its power in § 381(a) of the Federal Food, Drug, and

Cosmetic Act (the "FDCA"), 21 U.S.C. §§ 301 et seq.           Based on an

examination of cans from both shipments4 and additional information

provided by Hwa Chen, the FDA determined that the mushrooms were

not processed or packaged in Taiwan.        The FDA thus concluded that

an unknown factory in China used Hwa Chen's can codes in a

deliberate attempt to circumvent the broad import alert on canned

mushrooms originating in China. The FDA then advised First Phoenix

that it would likely refuse admission of the mushrooms and allow

reexport only under very strict conditions.            The FDA, however,

issued no formal notice of refusal of admission.             The FDA then

conducted   additional   testing   of   a   separate   lot   of   mushrooms

ostensibly packaged at Hwa Chen and shipped into the United States

by First Phoenix, but not at issue in this appeal.                Based on

staphyloccal enterotoxin found in these mushrooms, the FDA informed

     3
      Between July 29 and December 14, First Phoenix located a
purchaser in Russia for the mushrooms.
     4
      The FDA sampled the mushrooms from the 3,000-can shipment,
but found no adulteration of the mushrooms.

                                   4
First Phoenix of its decision to destroy the mushrooms, rather than

allow reexport.      Thus, the FDA decided to proceed under the

authority provided in 21 U.S.C. § 334, instead of proceeding under

21 U.S.C. § 381.

      Accordingly, on November 3, 1993, the government filed a

complaint in the United States District Court for the Eastern

District of Louisiana seeking seizure and condemnation of both

shipments of mushrooms as adulterated and misbranded goods in

interstate commerce under its authority in 21 U.S.C. § 334(a) of

the FDCA.   Under the district court's warrant for the arrest of

both shipments, the United States Marshals Service seized and

attached the shipments at the New Orleans warehouse where they were

stored upon entry into New Orleans and continue to be held at the

present time.      On April 19, 1994, the district court granted

summary judgment in favor of First Phoenix and dismissed the

government's case.    The district court held that the mushrooms had

never entered interstate commerce as required for an action under

§ 334(a) because they had continually remained under Customs

Service transit bonds. The district court thus determined that the

Customs Service remained in control of the mushrooms since their

import into the United States.      Finally, the court concluded that

§ 381(a) was the government's exclusive authority with respect to

the mushrooms and gave First Phoenix the opportunity to reexport

the two shipments before being destroyed by the FDA.     Thereafter,

the   district     court   denied   the   government's   motion   for

reconsideration and granted its motion for a stay of the judgment

                                    5
pending appeal.

     On appeal, the government argues that because the mushroom

shipments fall within the statutory definition of "interstate

commerce," it had the authority to bring a § 334 seizure and

condemnation action in the district court.    The government further

contends that its authority to act under this statute is unaffected

by the fact that the administrative remedy in § 381 is also

available to it in this case.    The government thus concludes that

the district court erred in granting summary judgment in favor of

First Phoenix on the basis that § 381 restricted the government's

authority under § 334 to situations when the goods at issue were in

"interstate commerce."

                                  II

         In this appeal, we must consider whether the district court

erred in granting summary judgment in favor of First Phoenix and

dismissing the government's complaint on the grounds that the facts

here failed to demonstrate a claim under § 334.5    To resolve this

     5
      Because this is a case on appeal from the district court's
grant of summary judgment, we review the record de novo.
Calpetco 1981 v. Marshall Exploration, Inc., 989 F.2d 1408, 1412
(5th Cir.1993).

          The government argues that the FDA's interpretation of
     the statutes at issue in this case should be given
     "controlling weight." See Chevron, U.S.A., Inc. v. Natural
     Resources Defense Counsel, Inc., 467 U.S. 837, 843, 104
S. Ct. 2778, 2782, 81 L. Ed. 2d 694 (1984) (holding permissible
     interpretation of agency charged with administering statute
     at issue must be given controlling weight when Congress had
     not addressed question at issue). Because it appears that
     the FDA interpreted § 334 and § 381 at such a time and in
     such a manner so as to provide a convenient litigating
     position for this suit, we disagree and conclude that the
     FDA's position is not controlling. See Irving Indep. Sch.

                                   6
question, first, we must determine whether imported goods, which

never are released from Customs Service upon arrival in the United

States satisfy the interstate commerce requirement, as defined in

the FDCA.   Second, we must determine whether a § 334 judicial

proceeding may be brought with respect to goods seized at the port

of entry and never released by the Customs Service or whether in

these circumstances, the FDA is limited to the administrative

procedures under § 381.       We hold that the interstate commerce

requirement has been satisfied in this case and that goods seized

at the port of entry may be the proper subject of an action under

§ 334. We therefore reverse the judgment of the district court and

remand for further proceedings not inconsistent with this opinion.

                                 III

                                  A

      We first examine whether the mushrooms in this case were

introduced into "interstate commerce," as required to initiate a

seizure and condemnation action under § 334.   In relevant part, 21

U.S.C § 334(a)(1) provides:

     Any article of food, drug, or cosmetic that is adulterated or
     misbranded when introduced into or while in interstate
     commerce or while held for sale ... after shipment in
     interstate commerce ... shall be liable to be proceeded
     against while in interstate commerce, or at any time
     thereafter, on liable of information and condemned in any
     district court of the United States ... within the
     jurisdiction in which the article is found.

21 U.S.C. § 334(a)(1) (1972 & Supp.1995).      Thus, to initiate an

     Dist. v. Packard Properties, 970 F.2d 58, 64 (5th Cir.1992)
     (discounting strategically timed and conveniently favorable
     agency interpretation given after agency's involvement in
     litigation over the disputed provision).

                                  7
action for seizure and condemnation, the FDA must prove only that

the    goods     have       been     introduced        into    interstate    commerce,

notwithstanding the fact that the goods may be removed at some

later time from interstate commerce.                   The FDCA expansively defines

interstate commerce as "commerce between any State or Territory and

any place outside thereof."6                 21 U.S.C. § 321(b) (1972).            Here,

each       shipment   was    shipped        from   a   place    outside     the   United

States—Taiwan—and entered the United States at Savannah, Georgia,

and Long Beach, California, respectively, where they arrived and

were unloaded.7         There is some suggestion, however, that these

mushrooms may have been effectively detained at sea by the import

alert and thus were removed from the stream of commerce before they

actually entered        the        United    States.      If,   however,     goods   are

destined for sale in a state other than the place from which they

are shipped, then goods are in "interstate commerce" without the

necessity of physically crossing a state boundary.                    Merchants Fast

       6
      We have found very few cases interpreting this provision
and none within our circuit. In Roseman v. United States, 364
F.2d 18 (9th Cir.1966), cert. denied, 386 U.S. 918, 87 S. Ct. 879,
17 L. Ed. 2d 789 (1967), the Ninth Circuit broadly interpreted
interstate commerce under § 321(b) to include transportation from
Canada into the United States and from Washington to California.
Roseman, 364 F.2d at 24 (citing 230 Boxes, More or Less, of Fish
v. United States, 168 F.2d 361 (6th Cir.1948)). The court noted
that § 321(b) included "importation" within its definition as a
means to avoid the possibility that someone could transport
"merchandise into the United States or from one border state to
another via a foreign country without conforming to the
substantive provision of the FDCA and without violating" the
FDCA. Roseman, 364 F.2d at 26.
       7
      When these goods left Taiwan, they were destined for New
Orleans and were unloaded in Georgia and California because
overland transportation was more convenient and inexpensive than
direct shipment to New Orleans, Louisiana.

                                              8
Motor Lines, Inc. v. Interstate Commerce Comm'n, 528 F.2d 1042,

1044 (5th Cir.1976);   see Texas v. United States, 866 F.2d 1546,

1556 (5th Cir.1989) (stating intent at time of shipment is crucial

to determination of essential character of shipment as interstate

or intrastate).   Thus, we conclude that the mushrooms in this case

undoubtedly constituted an interstate shipment from the moment they

left Taiwan.

     The question remaining is whether these goods, which were

never released for sale in the United States from the Customs

Service, were also in "commerce," as required by § 321(b).   First

Phoenix argues that these mushrooms could not possibly be in

commerce because from the moment the goods were placed on alert,

even before they arrived in the United States, and at all times

thereafter, sale of these goods in the United States was prohibited

by the FDA.    First Phoenix additionally argues that because the

mushrooms were held under Customs Service bonds8 since arriving in

the United States, they were never introduced into interstate

commerce as required in § 334 for a condemnation action.     First

     8
      A Customs Service bond includes any bond required under
Customs laws or regulations in order to perform a particular
Customs activity. 19 C.F.R. § 113.61 (1994). Under 19 U.S.C. §
1553, "[a]ny merchandise, other than ... merchandise the
importation of which is prohibited, ... may be entered for
transportation in bond through the United States by a bonded
carrier without appraisement or the payment of duties." 19
U.S.C. § 1553 (1980 & Supp.1995). Here, both shipments were
transported under bond and to New Orleans based on § 1553. These
bonds were obtained to secure duties, taxes, and other charges
due on the shipments of the imported mushrooms. See 19 C.F.R. §
113.62 illust. a (requiring bond securing duties, taxes, and
charges imposed or estimated to be due if merchandise is released
from Customs custody).

                                 9
Phoenix attempts to place an impossibly narrow construction on a

very broad statute.    Regardless of the government's impediments to

the sale of these goods once they reached the United States, these

goods nevertheless had been shipped to the United States for the

express purpose of sale when they left Taiwan. Although restricted

from immediate sale by the import alert and other FDA action, and

although they may now have been removed from commerce by the import

alerts, the goods were "introduced" into interstate commerce—for

the purpose of satisfying the statutory requirements here—when they

left Taiwan because they had been then injected into the mercantile

stream and were on their way to a market in the United States where

potential purchasers awaited. In sum, we hold that these mushrooms

had been introduced into interstate commerce at the time they were

detained   by   the   Customs   Service,    given   the   expansive   and

unrestricted definition of § 321(b).

     Having determined that the mushrooms had been introduced into

interstate commerce, it is plain on the face of the statute that §

334 is a judicial remedy available to the FDA in this case.       We now

must address, however, First Phoenix's argument that Congress

intended § 334 to apply only to seizures of goods that have been

released from the Customs Service.      In short, First Phoenix argues

that only the administrative procedures under § 381 may be invoked

by the FDA when the goods are seized at the port of entry and not

yet admitted into the United States.       We now turn to consider this

question of whether § 334 and § 381 create two mutually exclusive

statutory remedies for goods under the FDCA.

                                   10
                                        B

                                       (1)

         As earlier discussed, § 334(a) is a judicial remedy available

to the FDA allowing it to seize and condemn any goods that have

been introduced into or are already in interstate commerce or after

shipment is in interstate commerce, but if the FDA chooses to

proceed under this statute it must prove in a court of law by a

preponderance of the evidence that the goods are indeed adulterated

or misbranded.        Section 381, on the other hand, is purely an

administrative procedure, which allows a quick and efficient means

of protecting the American public from unhealthy or mislabeled

imported goods.       In relevant part, 21 U.S.C. § 381(a) provides:

     The Secretary of the Treasury shall deliver to the Secretary
     of Health ... samples of food, drugs, and cosmetics which are
     being imported or offered for import into the United States
     ... [and] if it appears from the examination of such samples
     ... that ... such article is adulterated, [or] misbranded such
     article shall be refused admission, except as provided in
     subsection (b) of this section. The Secretary of the Treasury
     shall cause the destruction of any article refused admission
     unless such article is exported, under regulations prescribed
     by the Secretary of the Treasury, within ninety days of the
     date of notice of such refusal or within such additional time
     as may be permitted pursuant to such regulations.

21 U.S.C. § 381(a) (1972 & Supp.1995) (emphasis added).9

     Clearly     no   provision   of    §    381   expressly   restricts   the

authority of the FDA from proceeding judicially under § 334 when it

seizes and holds goods at the port of entry in the United States.10

     9
      The FDA has not issued a formal notice of refusal of
admission of these mushrooms.
     10
      We point out that § 381 undoubtedly only applies to goods
detained at the port of entry and any seizure of imported goods
after release by the Customs Service must submit to judicial

                                       11
If goods are, in point of time, both "in interstate commerce" and

"being imported or offered for import into the United States," as

the mushrooms here, the plain words of the statutes permit the

government the option of proceeding under either § 334 or § 381.11

We now examine First Phoenix's arguments, based primarily on

legislative history and statutory construction, that these statutes

do create mutually exclusive systems for dealing with imported

adulterated or misbranded goods, i.e., § 381 applies exclusively to

goods at the port of entry and § 334 applies exclusively to goods

that have been released from the Customs Service.

                               (2)

proceedings under § 334. The question here is whether these
statutes provide overlapping remedies for goods seized at the
port of entry so that the government, at that point, may chose to
proceed under either § 334 or § 381.
     11
      First Phoenix argues that the express language of § 381
mandates that adulterated goods being imported or offered for
import, as here, shall be refused admission. Once admission is
refused, First Phoenix argues, § 381 grants the importer an
unqualified right to reexport the goods within ninety days of
this refusal. First Phoenix contends, and the district court
agreed, that allowing the FDA the option of proceeding under §
334 or § 381 when the imported goods meet the prerequisites of
both would emasculate its unqualified right granted by § 381 to
reexport goods within ninety days of refusal of admission.

          We acknowledge that this plain language projects a
     forceful argument that importers have an unequivocal right
     to a notice of refusal of admission. And it is true that if
     the FDA proceeds under § 334, as they have in this case, the
     importer does not receive a notice of refusal of admission
     and the concomitant right to reexport. Nevertheless, we are
     convinced that the more compelling view of the statutory
     scheme, for reasons we express in this opinion, is that the
     FDA has an option to proceed under either statute with
     respect to goods detained at the port of entry, and if the
     government chooses to proceed under § 334, the right to a
     notice of refusal and opportunity to reexport provided in §
     381 simply is inoperative.

                                12
     When     Congress     enacted   the    FDCA    in   1938,   it   intended    to

strengthen the provisions of its predecessor act—the Federal Food

and Drugs Act of 1906 (the "1906 Act").12                H.R.REP. No. 2139, 75th

Cong., 3d Sess. (1938), reprinted in FEDERAL FOOD, DRUG,               AND   COSMETIC

ACT: A STATEMENT   OF   ITS LEGISLATIVE RECORD 816 (Charles Wesley Dunn ed.,

1987) (hereinafter LEGISLATIVE RECORD).            Without substantial change,

Congress modeled § 334 and § 381 of the FDCA13 after § 1014 and §

     12
          The Supreme Court noted:

             By the Act of 1938, Congress extended the range of its
             control over illicit and noxious articles and stiffened
             the penalties for disobedience. The purposes of this
             legislation thus touch phases of the lives and health
             of people which, in the circumstances of modern
             industrialism, are largely beyond self-protection.
             Regard for these purposes should infuse construction of
             the legislation if it is to be treated as a working
             instrument of government and not merely as a collection
             of English words.

     United States v. Dotterweich, 320 U.S. 277, 280, 64 S. Ct.
134, 136, 88 L. Ed. 48 (1943) (internal citations omitted).
     13
      With the exception of the two amendments discussed later
in this opinion, the 1938 versions of § 334 and § 381 are
substantially similar to those presently in effect and quoted in
relevant part earlier in this opinion.
     14
      The seizure and condemnation provision contained in § 10
of the 1906 Act provided in relevant part:

             any article of food ... that is adulterated or
             misbranded within the meaning of this act, and is being
             transported from one State, Territory, District, or
             insular possession to another for sale, or, having been
             transported, remains unloaded, unsold, or in original
             unbroken packages, or if it be sold or offered for sale
             in the District of Columbia or the Territories, or
             insular possessions of the United States, or if it be
             imported from a foreign country for sale, or if it is
             intended for export to a foreign country, shall be
             liable to be proceeded against, ... and seized for
             confiscation by a process of libel for condemnation.

                                       13
11,15 respectively, of the 1906 Act.                  See   H.R.REP. NO. 2130,

reprinted in LEGISLATIVE HISTORY at 818, 827 (stating that FDCA

retained      without      substantial   change   seizure    and   condemnation

provision of § 10 and import-export provision of § 11 of 1906 Act).

Specifically, the FDA's power to refuse admission under § 381 to

goods appearing adulterated and "being imported or offered for

import into the United States" remained virtually identical to §

11.        With   regard   to   the   seizure   and   condemnation   provision,

Congress compacted the extensive language of § 10, describing the

legal character of goods subject to condemnation, simply to those

      Food and Drugs Act of 1906, § 10, reprinted in LEGISLATIVE
      RECORD at 832 (emphasis added). This entire enumeration of
      instances when goods could be seized and condemned was
      replaced in § 334 with "when introduced into or while in
      interstate commerce or while held for sale ... after
      shipment in interstate commerce." The underscoring above,
      however, demonstrates that § 10, according to its express
      terms, would have been clearly applicable to the mushrooms
      in this case.
      15
      The import-export provision contained in § 11 of the 1906
Act provided in relevant part:

              The Secretary of the Treasury shall deliver to the
              Secretary of Agriculture ... samples of foods and drugs
              which are being imported into the United States or
              offered for import ... and if it appear from the
              examination of such samples that any article of food or
              drug offered to be imported into the United States is
              adulterated or misbranded within the meaning of this
              act ... the said article shall be refused admission,
              and the Secretary of the Treasury shall ... cause the
              destruction of any goods refused delivery which shall
              not be exported by the consignee within three months
              from the date of notice of such refusal.

      Food and Drugs Act of 1906, § 11, reprinted in LEGISLATIVE
      RECORD at 832-33. This provision remained substantially
      unchanged when enacted as § 381, with the exception that the
      three months given for reexport was technically changed to
      ninety days in § 381.

                                         14
goods "introduced into or while in interstate commerce or while

held for sale ... after shipment in interstate commerce."16

     First Phoenix primarily relies on the two substantial post-

1938 amendments to § 334 and § 381 as support for its position that

Congress intended § 334 and § 381 to operate mutually exclusively.

Prior to 1949, § 381—unlike § 334—did not allow importers the right

to bring adulterated or misbranded goods into compliance with FDA

standards.    In 1949, however, Congress amended § 381 to give

importers    this    opportunity   to   cure—an   opportunity   already

recognized, as put by the congressional reports, "with respect to

articles seized in domestic commerce and condemned by court decree"

under § 334.        S.REP. NO. 890, 81st Cong., 1st Sess. (1949),

reprinted in 1949 U.S.C.C.A.N. 2147, 2147 (emphasis added).       This

underscored language suggests that Congress understood that § 334

applied to goods in domestic commerce, with the implication that §

381 was the applicable statute for proceeding against goods at the

port of entry. Moreover, First Phoenix argues with some force that

if imported goods detained at the port of entry have already been

     16
      First Phoenix recognizes that Congress intended no
substantial change from the 1906 Act with respect to the
administrative and judicial proceedings of the FDCA. First
Phoenix contends, however, that the provisions were always
intended to be mutually exclusive remedies for the FDA when
dealing with adulterated or misbranded goods. First Phoenix
argues that § 11 of the 1906 Act provided the government's
exclusive authority with respect to goods detained at the port of
entry and allowed the government only to refuse entry of these
goods into the United States. First Phoenix contends that this
limited power of exclusion for goods detained at the port of
entry continued in § 381 of the FDCA. First Phoenix thus
concludes that the FDA has never had the power to proceed
judicially to destroy the goods that are never released from the
Customs Service.

                                   15
"introduced into interstate commerce" within the meaning of § 334,

then Congress would have had no reason to amend § 381 to give the

FDA the option of allowing the importer to bring his goods into

compliance because this option was already available in § 334 for

goods in interstate commerce.       Therefore, First Phoenix contends

that Congress, recognizing that goods detained by the Customs

Service at the port of entry are not subject to § 334, amended §

381 to provide importers the opportunity to cure goods not yet

admitted into the United States.

      Next, in 1957, Congress amended § 334 to provide importers an

opportunity, as similarly provided in § 381, to reexport goods in

certain instances when, in the words of the congressional report,

the   imported   goods   "have   been    seized   by   the   Food   and   Drug

Administration and condemned at places within the United States

other than at the original port of entry."             S.REP. NO. 993, 85th

Cong., 1st Sess. (1957), reprinted in U.S.C.C.A.N. 1791, 1791

(1957).    The report explained that "[a]t the present time the

Federal Food, Drug, and Cosmetic Act permits the reexportation of

articles if they were seized at the original port of entry ...

[but] does not permit reexportation of imported articles ... after

such articles have entered domestic commerce." S.REP. NO. 993, 85th

Cong., 1st Sess. (1957), reprinted in U.S.C.C.A.N. 1791, 1791

(1957).   Indeed, the Secretary of Health, Education, and Welfare

seemed to take note that § 334 applied when adulterated goods were

seized in domestic situations:           his report provided that the

amended § 334 would allow food "imported from foreign countries and

                                    16
entered through customs into the United States, if subsequently

seized under domestic provisions of the law as violative of the

Food, Drug, and Cosmetic Act may under certain conditions be

reexported."      S.REP. NO. 993 (quoting Report by M.B. Folsom,

Secretary of the Department of Health, Education, and Welfare

(August 13, 1957)).      Those conditions, now part of the statute as

a result of the 1957 amendment, are, first, the FDCA violation must

not have occurred after the article was imported and, second, the

importer   must   have   had   "no   cause   for   believing   that   it   was

adulterated, misbranded, or in violation before it was released

from customs custody." 21 U.S.C. § 334(d) (emphasis added). First

Phoenix contends that because the right to reexport under § 334 is

expressly limited to goods that have left the port of entry, no

right to reexport goods condemned under § 334 exists with respect

to goods detained at the port of entry.             The right to reexport

goods detained at the port of entry does exist, however, under §

381.   This distinction between the two statutes clearly indicates,

according to First Phoenix, that the rights of importers whose

goods are detained at the port of entry are embodied only in § 381

and the rights of importers whose goods are detained after they are

released from the port of entry are found in § 334.             Thus, First

Phoenix cites this 1957 amendment to § 334 as evidence that

Congress intended separate, independent and mutually exclusive

procedural mechanisms for goods detained at the port of entry, on

the one hand, and goods admitted into the United States, on the

other hand.

                                      17
     In short, First Phoenix concedes that Congress intended to

strengthen the United States' food and drug laws when it enacted

the FDCA, but argues that nothing in the legislative history or

statutory scheme indicates that Congress intended to extend the

FDA's power under § 334 to goods offered for import.             Instead,

First Phoenix argues that Congress understood these two statutes

applied at two distinct points in time—before release from the

Customs Service and after release—and amended these statutes in

order to provide parallel rights under § 381 and § 334.                First

Phoenix accordingly contends that the legislative history and the

statutory scheme supports its view that Congress intended the

remedies provided under § 334 and § 381 to operate in mutually

exclusive circumstances—an administrative proceeding under § 381 to

refuse adulterated or misbranded goods detained at the port of

entry and a judicial proceeding under § 334 to seize and condemn

goods after admitted into the United States.

                                    (3)

     We can appreciate the arguments of First Phoenix as pointing

to how the statues logically and practically operate. It certainly

appears true that Congress assumed that § 381 and § 334 ordinarily

apply in separate factual circumstances. Furthermore, we recognize

the more recent amendments of 1949 and 1957 were intended to

provide certain parallel rights in each situation.

     The   legislative   history,    however,   also   makes   clear    that

Congress intended to empower the FDA with the broadest possible

authority over imported contaminated goods. The plain words of the

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statute expansively define "interstate commerce" to effectively

include   foreign     commerce.        Moreover,    no    statutory       language

prohibits the application of § 334 to goods seized at the port of

entry. Although the legislative history demonstrates that Congress

was under the impression that § 334 and § 381 ordinarily operate

exclusive of each other, we cannot say, in the face of Congress's

broad definition of interstate commerce, that Congress intended to

preclude the FDA from ever pursuing the judicial remedy provided in

§ 334 in cases deemed appropriate by the FDA.                  There will, from

time to time, be plausible and practical bases for allowing the

government the option of proceeding under § 334 or § 381 when goods

are detained at the port of entry.              As we have observed, the

procedures and burdens established by these two statutes are quite

different.     When the government lacks the ability to prove a

violation of the FDCA by a preponderance of the evidence, or when

the risks to human health are not major or critical, the government

can pursue the administrative procedures of § 381 and simply

require reexportation of the goods.             Consequently, the risk of

property loss to the owner of the goods is minimized, threats to

health and    other      interests    of   consumers     are   avoided,    and   no

significant legal process is required. On the other hand, when the

circumstances pose a critical risk to the health of United States

citizens,    the   FDA    has   the   option   of   initiating      a     judicial

condemnation proceeding under § 334.            In this situation, the FDA

can destroy the goods without giving the importer the opportunity

to reexport, but only after proving by a preponderance of the

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evidence   that    the   goods   are      adulterated     or    misbranded.

Accordingly,   this   more   cumbersome    remedy   has   the    effect   of

protecting the property rights of the owner of the goods who do not

have the opportunity to reexport.      At the same time, § 334 allows

the government a sure mechanism, i.e., destruction, to prevent the

possibility of undetected reimportation of dangerous goods into the

United States.    We find this optional system rational and find no

sufficient reason to disregard the plain language of § 334, which

would be necessary if we accepted the arguments of First Phoenix.

In sum, we find no indication that Congress intended to tie the

hands of the FDA to deny it flexibility.

     We therefore hold that the plain language of § 334 permits the

FDA to initiate a seizure and condemnation action, such as the one

before us, when goods are seized at the port of entry.                    The

district court is REVERSED and the case REMANDED for further

proceedings not inconsistent with this opinion.

     REVERSED and REMANDED.

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