Court Opinion

ID: 2977939
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Date Created: 2015-09-22 18:16:34.001338+00
Date Added: 2024-06-11T11:44:09.928532
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                                      File Name: 09a0198p.06

                 UNITED STATES COURT OF APPEALS
                                  FOR THE SIXTH CIRCUIT
                                    _________________

                                              X
                                               -
 PAUL H. VOLKMAN,
                                               -
                                           Petitioner,
                                               -
                                               -
                                                    No. 08-3802
          v.
                                               ,
                                                >
                                               -
                                               -
 UNITED STATES DRUG ENFORCEMENT

                                Respondent. -
 ADMINISTRATION,
                                               -
                                              N
                 On Petition for Review of a Decision from the
                     United States Department of Justice,
                      Drug Enforcement Administration.
                                  No. 06-45.
                                    Argued: March 12, 2009
                               Decided and Filed: June 3, 2009
                                                                                               *
      Before: MARTIN and GILMAN, Circuit Judges; ZOUHARY, District Judge.

                                      _________________

                                           COUNSEL
ARGUED: Kevin P. Byers, KEVIN P. BYERS CO., LPA, Columbus, Ohio, for
Petitioner. Tritia Lindsay Yuen, UNITED STATES DEPARTMENT OF JUSTICE,
Washington, D.C., for Respondent. ON BRIEF: Kevin P. Byers, KEVIN P. BYERS,
CO., LPA, Columbus, Ohio, for Petitioner. Anita J. Gay, UNITED STATES
DEPARTMENT OF JUSTICE, Washington, D.C., for Respondent.
                                      _________________

                                            OPINION
                                      _________________

        BOYCE F. MARTIN, JR., Circuit Judge. Paul Volkman applied for a federal
registration to dispense controlled substances. The Drug Enforcement Agency denied

        *
           The Honorable Jack Zouhary, United States District Judge for the Northern District of Ohio,
sitting by designation.

                                                  1
No. 08-3802        Volkman v. Drug Enforcement Administration                     Page 2

his application, concluding that Volkman’s registration was not in the public interest.
The DEA reached this conclusion based on its finding that Volkman’s prior prescribing
practices violated state and federal law. Paul H. Volkman, Denial of Application, 73 FR
30629-03, No. 06-46 (May 28, 2008). Volkman petitions this Court for review of the
DEA’s denial of his application. Because the DEA’s determination is in accordance
with law and is supported by substantial evidence, we DENY Volkman’s petition.

                                           I.

       Volkman holds an M.D. and a Ph.D. from the University of Chicago. In 2003,
after large medical malpractice settlements and judgments left him unable to purchase
malpractice insurance, Volkman started working at Tri-State Healthcare, a pain clinic
in Portsmouth, Ohio.     Denise Huffman, who is not a physician or a healthcare
professional, owned Tri-State and paid Volkman $5,000 a week to start. (Volkman says
that he was never a Tri-State employee, and was, instead, an independent contractor.)
As required by the Controlled Substances Act, Volkman applied for a DEA registration
to prescribe controlled substances from Tri-State’s office. The DEA granted his
application.

       Soon after he began working at Tri-State, pharmacists in the area started
complaining to the Ohio State Board of Pharmacy about Volkman’s prescribing
practices. One pharmacist said that Volkman was “writing large quantities of narcotics
and benzodiazepines” and that many of his patients were “prior problem patients” of a
physician who had been convicted of drug trafficking. That pharmacist refused to fill
any of Volkman’s prescriptions. A second pharmacist complained that Volkman was
prescribing “duplicate therapy of narcotics.” Yet another told the Board that he was
having “trouble” with Volkman’s patients, and that they “smelled of beer and dope.”
These calls continued throughout the summer of 2003. Around the same time, Volkman
applied to the Board for a “Terminal Distributor of Dangerous Drugs license”—a state
license that allows a clinic to buy controlled substances and dispense them directly from
the clinic. The Board inspected Tri-State’s clinic and, despite the complaints, granted
Volkman’s application for the on-site distribution license.
No. 08-3802        Volkman v. Drug Enforcement Administration                      Page 3

       Once Volkman had both a DEA registration and a state license, Tri-State, using
Volkman’s DEA registration number, started ordering dosage units of oxycodone and
a combination of hydrocodone and acetaminophen. The volume of Tri-State’s drug
purchases was, compared to other practitioners, very large: During the last six months
of 2003, Tri-State purchased more than twenty-eight times the amount of oxycodone
purchased by the next largest Ohio-based practitioner. And in 2004, Tri-State was the
largest practitioner-purchaser of oxycodone in the United States.

       The DEA office in Columbus, Ohio also received complaints about Volkman.
One pharmacist in Kenova, Ohio reported that Volkman was prescribing “numerous
prescriptions for OxyContin and Percocet” in “very large” quantities. He reported that
the customers with prescriptions from Volkman “were lining up outside” of his
pharmacy to get them filled. The Columbus DEA office got a call from a fellow agent
in Texas passing along a report from a drug distributor there that Volkman had ordered
large quantities of combination hydrocodone and acetaminophen. In November 2003,
an area physician called the DEA to report that “numerous” Volkman patients were
seeking detoxification treatment because Volkman was prescribing excessive amounts
of opiates such as OxyContin, Percocet, and hydrocodone. In response to these
complaints, the DEA obtained pharmacy records and a list of all the scheduled drugs
dispensed under Volkman’s prescriptions.

       Later in 2003, Tri-State moved its clinic to a new location. The move triggered
another inspection by the Ohio Board of Pharmacy. This time, the state agent inspecting
Tri-State found several violations, including incomplete records and dispensing logs.
He also noted some remarkable differences between Tri-State and “your normal doctor’s
office,” including a Glock handgun, two night sticks and a four-foot club with leather
straps—all in the area where the clinic dispensed drugs. The agent also observed that
the clinic’s owner appeared “over medicated” and received reports that sometimes
twenty to thirty cars were lined up outside the clinic. All this led the state agent to
suspect that Volkman was running a “prescription mill.” But this suspicion did not
induce the Board to withhold the clinic’s state license; instead, it issued the license on
No. 08-3802         Volkman v. Drug Enforcement Administration                      Page 4

Feburary 4, 2004, after Volkman sent a letter stating that Tri-State was “in compliance
with all issues.”

        There was little activity on the part of the DEA or the Ohio State Board of
Pharmacy for the following year and half until June 7, 2005 when the DEA executed a
search warrant at Tri-State and seized controlled substances, patient records, invoices,
DEA forms, and financial records. One DEA investigator interviewed Denise Huffman,
who reported that the clinic was a “full cash business,” charging $200 for an office visit.
Huffman said that her daughter, Alice Huffman, and Volkman “were in complete control
of the dispensing center.” Alice Huffman confirmed this and provided the agent with
the names of two Tri-State patients who had died from drug overdoses. She also
admitted that she was supposed to “keep the records,” including dispensing logs, but did
not and was not sure if inventories existed at all, nor whether any records that might
exist would be accurate. The DEA agents tried to take an inventory of the drugs they
seized by checking Tri-State’s dispensing logs against records from the drug distributors.
But the agents did not find any initial or biennial inventories of the drugs, nor any
dispensing logs for the year 2004. According to the DEA, the clinic could not account
for over one million products or tablets of the audited controlled substances. Denise
Huffman later produced logs for 2005, but admitted that there were no records for 2004.

        Volkman continued working at Tri-State for a few months after the raid, but then
quit and started seeing patients out of his apartment. In October 2005, the Portsmouth
Police Department executed a search warrant there and seized Volkman’s patient files.
The Department never filed any charges but issued a condemnation notice for the
apartment.

        Volkman then moved about an hour north to Chillicothe, Ohio and applied to
modify his DEA registration to reflect this new location. Some four months later, DEA
investigators obtained a search warrant for the Chillicothe clinic, which they executed
on February 10, 2006 by, according to Volkman’s brief, sweeping in “with helicopters,
guns, and masked agents” in a “shock and awe raid.” Three days later, the DEA served
Volkman an Order to Show Cause, informing him that his DEA registration to distribute
No. 08-3802           Volkman v. Drug Enforcement Administration                                Page 5

controlled substances would be suspended immediately under 21 U.S.C. § 824(d)
because his continued registration constituted “an imminent danger to the public health
and safety.” The next day, Volkman filed a written request for an expedited hearing and
asked for full access to his records. He later applied for a renewal of his DEA
registration.

         Volkman’s DEA hearing started on December 5, 2006 and continued until
December 8. On December 8, the hearing was adjourned and resumed on January 9,
2007. Among other witnesses, two physicians, L. Douglas Kennedy and Wayne
Wheeler, testified as experts on behalf of the DEA. Volkman testified in his defense, as
did a former Tri-State employee and two employees who worked for Volkman after he
left Tri-State. Both sides also submitted written evidence to the administrative law
judge.

         The administrative law judge issued her recommendation in June 2007. She
found that Volkman unlawfully prescribed controlled substances, failed to adequately
monitor patients, which directly contributed to the deaths of at least sixteen patients,
improperly dispensed controlled substances, did not maintain adequate records or
inventories, and repeatedly refused to take responsibility for his behavior.                       She
recommended revocation of his DEA registration and denial of any pending applications.

         The DEA Deputy Administrator reviewed the evidence and the administrative
law judge’s recommendations and concluded that granting Volkman’s application for
a new registration1 would be “inconsistent with the public interest,” in contravention of
21 U.S.C. § 823(f), based on Volkman’s “experience in dispensing controlled
substances,” his lack of compliance with state and federal law relating to controlled
substances, and “other conduct which may threaten the public health and safety.” The
Deputy Administrator also considered and rejected Volkman’s claims that he was denied

         1
          Volkman’s registration that was in effect at time it was suspended expired before his hearing.
Consequently, the DEA considered his appeal as an application for a new registration, which is evaluated
by the same criteria as a revocation of an existing registration. 21 C.F.R. § 1301.51.
No. 08-3802         Volkman v. Drug Enforcement Administration                    Page 6

due process and that the decision was in conflict with the Supreme Court’s decision in
Gonzales v. Oregon, 546 U.S. 243 (2006). Volkman petitions this Court for review.

                                           II.

       The Deputy Administrator’s factual findings are conclusive if they are supported
by “substantial evidence.” 21 U.S.C. § 877. The Administrative Procedures Act
provides the applicable standard of review for the Deputy Administrator’s exercise of
discretion. Hoxie v. DEA, 419 F.3d 477, 482 (6th Cir. 2005). Thus, this Court will set
aside a revocation of a DEA certificate if it is “arbitrary, capricious, an abuse of
discretion, or otherwise not in accordance with law.” Id. (quoting 5 U.S.C. § 706(a)(2)).
The record must reflect “a rational connection between the facts found and the choice
made.” Id.

                                          III.

       Volkman challenges the denial of his application for DEA registration on several
grounds. First, he argues that the DEA’s adjudication denied him due process by
providing him inadequate notice and opportunity to be heard. Next, he contends that the
DEA’s denial of his Controlled Substances Act registration is unlawful because it is an
impermissible determination of what is “legitimate” medical practice by a federal agency
that lacks the expertise or authority to make such a determination. The DEA’s denial of
his registration, he argues, was an unauthorized attempt to “define the substantive
standards of medical practice” in violation of the Supreme Court’s decision in Gonzales
v. Oregon, 546 U.S. 243 (2006).          Finally, he argues that the DEA’s factual
determinations are not supported by substantial evidence. We consider each of these
arguments.

              A. The DEA adjudication satisfied due process requirements

       The Due Process Clause forbids an agency from using evidence in a way that
forecloses an opportunity for a party to offer a contrary presentation. Bowman Transp.
v. Arkansas-Best Freight Sys., 419 U.S. 281, 289 n.4 (1974).           In addition, the
Administrative Procedures Act, which provides the procedures for agency adjudication,
No. 08-3802        Volkman v. Drug Enforcement Administration                       Page 7

states that “[p]ersons entitled to notice of an agency hearing shall be timely informed
of—(1) the time, place, and nature of the hearing; (2) the legal authority and jurisdiction
under which the hearing is to be held; and (3) the matters of facts and law asserted.”
5 U.S.C. § 554(b). The DEA’s regulations further require that an Order to Show Cause
contain “a summary of the matters of fact and law asserted.” 21 C.F.R. § 1301.37(c).

        Volkman’s procedural attack focuses on his notice of the charges against him.
He argues that “the record from the agency proceeding exhibits a shocking litany of new
charges, modified charges, reduced charges, enhanced charges, newly-identified patients,
unidentified patients, new evidence, suspicious evidence, no evidence, hearsay, rampant
speculation, and wholly irrelevant and prejudicial testimony.” More specifically, he
argues that the DEA presented evidence at the hearing that “grossly exceeded the scope
of the February 2006 show cause order.”

        The Order to Show Cause alleged that eleven of Volkman’s patients had died
from the effects of drugs that Volkman had prescribed. Although the Order itself did not
identify the names of the patients, the DEA provided those names in its March 2006 pre-
hearing statement. As the hearing approached, the DEA indicated to Volkman that it did
not intend to introduce patient files into evidence, yet the DEA delivered nine patient
files to Volkman’s counsel four days before the hearing convened. Among these files
were the six patient files ultimately reviewed by the DEA’s expert, Kennedy. One of the
patients included in the case, Charles Robert Jordan, was not included in the Order to
Show Cause. Although initially Volkman had only four days to review the files and
prepare for the hearing after the DEA had provided him with the patient files supporting
its expert’s testimony, the administrative law judge adjourned the hearing for
approximately one month and also allowed Volkman to defer his cross-examination until
then.

        Volkman also complains that “at the hearing itself, the government witnesses
brought forth information, without a single chart in evidence, about at least twenty-five
patients.” Volkman maintains that he “could never be certain how many patients were
at issue, who the specific patients were, what their charts showed or did not show, and
No. 08-3802        Volkman v. Drug Enforcement Administration                       Page 8

what criticisms were being leveled at him.” The DEA Deputy Administrator considered
this argument, and, after finding that Volkman did not preserve it because he did not
provide “specific and complete citations of the pages of the transcript,” observed that she
nonetheless did not rely on this portion of the evidence. Thus, even if the administrative
law judge erred by admitting certain exhibits, the error was not prejudicial because the
Deputy Administrator did not rely on the exhibit with additional patients in reaching her
determination.

       Volkman compares the DEA’s treatment of his case to the Federal Trade
Commission’s handling of a charge in Bendix Corp. v. F.T.C., 450 F.2d 534 (6th Cir.
1971). In Bendix, this Court vacated the FTC’s decision and remanded because the
Commission “decided the case on a theory of illegality which was never charged, raised,
nor tried during the administrative hearing; never presented for consideration by the
Hearing Examiner; and not raised as an issue or discussed in the appeal,” id. at 537, thus
denying Bendix “notice . . . [and an] opportunity to present evidence in defense.” Id.

       The case against Volkman bears no resemblance to the procedural violations in
Bendix. Here, among other allegations, the Show Cause Order specifically alleged that
Volkman had prescribed multiple controlled substances to persons who, within days,
died from overdoses of the drugs. It also alleged that he was ordering excessive
quantities of controlled substances, far more than his peers, and that Volkman did not
perform physical examinations or keep proper dispensing records. These were the same
theories that the DEA advanced throughout the proceedings against Volkman, including
at the hearing before the administrative law judge. The specificity and detail of the Show
Cause Order, as clarified by the pre-hearing brief, provided Volkman with notice with
the nature of the DEA’s case. Indeed, unlike in Bendix, Volkman knew from the
beginning the nature of the DEA’s basis for suspending and later denying his registration
to distribute controlled substances. Moreover, the administrative law judge adjourned
the hearing to provide Volkman ample time to review the specific patient files that
supported the government’s case. And at the hearing, Volkman’s counsel was able to
cross-examine the DEA’s witnesses and probe their testimony for weaknesses. We
No. 08-3802         Volkman v. Drug Enforcement Administration                     Page 9

therefore conclude that the agency adjudication was procedurally adequate and provided
Volkman with a “meaningful opportunity” to prepare and present his defense.

                   B. The DEA’s denial of Volkman’s registration was
                       authorized by the Controlled Substances Act

       We next consider Volkman’s challenge to the DEA’s denial of his registration
against the backdrop of the Controlled Substances Act and the Supreme Court’s decision
in Gonzales v. Oregon, 546 U.S. 243 (2006).

       A “main objective” of the Controlled Substances Act is controlling “illegitimate
traffic in controlled substances,” by placing “substances in one of five schedules based
on their potential for abuse or dependence, their accepted medical use, and their accepted
safety for use under medical supervision.” Id. at 250. “To prevent diversion of
controlled substances with medical uses, the CSA regulates the activity of physicians.
To issue lawful prescriptions of Schedule II drugs, physicians must ‘obtain from the
Attorney General a registration issued in accordance with rules and regulations
promulgated by him.’” Id. (quoting 21 U.S.C. § 822(a)(2)).

       Under the Controlled Substances Act, the DEA may deny an application for a
practitioner’s registration upon a determination “that the issuance of such registration
would be inconsistent with the public interest.” 21 U.S.C. § 823(f). In determining
whether a registration is in the public interest, the Attorney General “shall” consider
these factors:

       (1)       The recommendation of the appropriate State licensing board or
                 professional disciplinary authority.
       (2)       The applicant’s experience in dispensing, or conducting research with
                 respect to 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.
No. 08-3802        Volkman v. Drug Enforcement Administration                    Page 10

§ 823(f). The Deputy Administrator, on behalf of the Attorney General, must consider
each factor, though he need not make explicit findings as to each one and can “give each
factor the weight [he] determines is appropriate.” Hoxie, 419 F.3d at 482.

       Volkman attacks the lawfulness of the DEA’s denial of his registration by relying
on Gonzales. That case concerned a dispute that arose after Oregon enacted the Oregon
Death with Dignity Act, which legalized physician-assisted suicide. Gonzales, 546 U.S.
at 249. In response, Members of Congress, “concerned about [the assisted-suicide act]
invited the DEA to prosecute or revoke the [Controlled Substances Act] registration of
Oregon physicians who assist suicide.” Id. at 252. The Attorney General concluded that
the Controlled Substances Act did not authorize the DEA to “displace the states as the
primary regulators of the medical profession, or to override a state’s determination as to
what constitutes legitimate medical practice[.]” Id. (quoting Letter from Attorney
General Janet Reno to Sen. Orrin Hatch, on Oregon’s Death with Dignity Act (June 5,
1998)). But in 2001, the new administration’s Attorney General issued an Interpretive
Rule that announced his intention to stop Oregon physicians from using controlled
substances in physician-assisted suicide. Id. at 254. He ruled:

       [A]ssisting suicide is not a ‘legitimate medical purpose’ withing the
       meaning of 21 CFR 1306.04 (2001), and that prescribing, dispensing, or
       administering federally controlled substances to assist suicide violates
       the Controlled Substances Act. Such conduct by a physician registered
       to dispense controlled substances may ‘render his registration . . .
       inconsistent with the public interest’ and therefore subject to possible
       suspension or revocation under 21 U.S.C. 824(a)(4). The Attorney
       General’s conclusion applies regardless of whether state law authorizes
       or permits such conduct by practitioners or others and regardless of the
       condition of the person whose suicide is assisted.
Id. (quoting 66 Fed. Reg. 56608 (2001)). The state of Oregon, joined by a terminally ill
patient, a physician, and a pharmacist, challenged the Interpretive Rule. The Ninth
Circuit Court of Appeals affirmed the district court’s permanent injunction against its
enforcement. The Supreme Court affirmed, holding that the Controlled Substances Act
does not give the Attorney General the authority to “define general standards of medical
practice.” Id. at 275. The Court explained that the Interpretive Rule on assisted suicide
No. 08-3802        Volkman v. Drug Enforcement Administration                    Page 11

was not authorized by the Controlled Substances Act because it was not based on the
“public interest” factors described in 21 U.S.C. § 823(f), but was instead the Attorney
General’s own judgment on a controversial practice, without regard to state law. Id. at
263-64. While recognizing the limits on an agency’s discretion to decide whether “a
physician who administers any controversial treatment could be deregistered,” id. at 262,
the Court nevertheless affirmed that “Congress regulates medical practice insofar as it
bars doctors from using their prescription-writing powers as a means to engage in illicit
drug dealing and trafficking.” Id. at 246.

       Here, by contrast, the Deputy Administrator explicitly applied the 21 U.S.C.
§ 823(f) factors and made an individualized determination that issuing a Controlled
Substances Act registration to Volkman would not be in the public interest. Volkman
argues that the Attorney General may not “pass judgment upon the medical care
[Volkman] rendered.” But the DEA did no such thing: It did not deny Volkman’s
application because of a disagreement over the best way to treat chronic pain sufferers,
nor did it deny his application because he purchased very large quantities of controlled
substances compared to his colleagues. The Deputy Administrator’s assessment of
Volkman’s prescribing and record-keeping practices was tethered securely to state law
(the Ohio regulations on the management of intractable pain) and federal regulations (the
Controlled Substance Act’s record-keeping requirements) in the context of evaluating
the Section 823(f) factors. Indeed, it was Volkman’s lack of compliance with state and
federal law that led the Deputy Administrator to conclude that the factors described in
Section 823(f) weighed against approving Volkman’s registration. Thus, unlike the
Interpretive Rule at issue in Gonzales, the DEA’s denial of Volkman’s registration was
consistent with the Controlled Substances Act’s “recognition of state regulation of the
medical profession,” 546 U.S. at 272, and its bar on physicians “from peddling to
patients who crave [] drugs for [] prohibited uses.” Id. at 274.
No. 08-3802         Volkman v. Drug Enforcement Administration                       Page 12

     C. Substantial evidence supports the Deputy Administrator’s determination

        In considering Section 823(f), the Deputy Administrator concluded that the
second (experience in dispensing controlled substances), fourth (compliance with state
and federal laws), and fifth factors (other conduct that threatens public health and safety)
“amply demonstrate” that granting Volkman’s application for registration would be
“inconsistent with the public interest.” The Deputy Administrator considered factors
two and four together and found that “the evidence conclusively establishes that
[Volkman] used his prescribing authority to act as a drug pusher.” Specifically, the
Deputy Administrator determined that Volkman did not comply with Ohio law in
prescribing controlled substances, and we find that substantial evidence supports this
decision. For example, Ohio law provides criteria for those prescribing drug treatment
for “intractable pain.” The practitioner “shall” perform:

        [A]n initial evaluation of the patient . . . documented in the patient’s
        record that includes a relevant history, including complete medical, pain,
        alcohol and substance abuse histories; an assessment of the impact of
        pain on the patient’s physical and psychological functions; a review of
        previous diagnostic studies and previously utilized therapies; an
        assessment of coexisting illnesses, diseases or conditions; and an
        appropriate physical examination;

Ohio Admin. Code R. § 4731-21-02(A)(1). But the investigating DEA agent found that
there was no documentation of a physical exam in 900 of the more than 1,200 patient
files seized in the raids. Kennedy, the DEA’s expert, also concluded that Volkman
conducted an inadequate history and physical examination of the patients who died after
receiving prescriptions from Volkman. Although Volkman introduced evidence that he
performed an initial physical exam on one of the six patients whose files were reviewed
by Kennedy, he did not introduce evidence to support the contention that he examined
any of the five others. And this is despite Volkman’s access to those patient files and
his testimony that he always documented his findings.

        Ohio law also instructs practitioners to refer patients to specialists for evaluation:
No. 08-3802        Volkman v. Drug Enforcement Administration                    Page 13

       The practitioner’s diagnosis of intractable pain shall be made after having
       the patient evaluated by one or more other practitioners who specialize
       in the treatment of the anatomic area, system, or organ of the body
       perceived as the source of the pain.

Ohio Admin. Code R. § 4731-21-02(A)(1). Kennedy testified that “[t]here was seldom
any diagnostic testing or past medical record present,” nor “plan[s] to diagnose or treat
the problem.” Volkman did not introduce evidence to contradict this conclusion, with
the exception of one patient who was referred to Cleveland Clinic.

       Volkman’s testimony about the role of opiates in pain-management does not alter
the conclusion that he was not in compliance with Ohio law. Nor does the testimony of
two employees who worked for him after he stopped working at Tri-State support his
argument, because they could not refute the evidence that Volkman violated Ohio’s pain
management regulations while he was working at Tri-State. Although Volkman testified
that he documented his diagnoses “at all times” and “always wrote my justification and
my thinking as to why I put patients on certain medicines,” the administrative law judge
made a finding that she “doubt[ed Volkman’s] credibility” with respect to his testimony
regarding his treatment practices because “[n]either Dr. Wheeler nor Dr. Kennedy
testified about finding such safeguards in the patient charts they reviewed” for the
hearing. The Deputy Administrator adopted the administrative law judge’s credibility
findings, though acknowledged that there was evidence that Volkman had, in at least one
case, performed a physical exam. Besides his own testimony, which the administrative
law judge found to be incredible, Volkman did not introduce any evidence to support his
contention that he followed the Ohio regulations on pain-management practice.

       Moreover, Volkman’s noncompliance with Ohio law was not the only ground the
Deputy Administrator relied on in concluding that his registration would not be in the
public interest. She also determined that Volkman did not keep proper records for
controlled substances that were ordered and dispensed under his registration. The
Controlled Substances Act requires all prescription-dispensing entities to conduct a
biennial inventory of all of the controlled substances it has on hand and to “maintain, on
No. 08-3802        Volkman v. Drug Enforcement Administration                     Page 14

a current basis, a complete and accurate record of each [controlled] substance” that it has
“received, sold, delivered, or otherwise disposed of.” 21 U.S.C. § 827(a)(1), (3).

       Substantial evidence also supports the Deputy Administrator’s conclusion that
Volkman’s record-keeping did not satisfy these standards. As early as 2003, a state
inspection revealed that Tri-State had not made any entries in several controlled
substance dispensing logs in more than four months. Two years later, during a raid of
Volkman’s practice, DEA investigators could not find any dispensing logs for the year
2004, despite the fact that these logs should have been maintained for two years. See 21
U.S.C. § 827(b). Although Tri-State later provided a log for 2005, it provided the log
only after the DEA returned the patient files, and the Deputy Administrator noted the
dubious authenticity of the log because it appeared “brand new.”

       The Deputy Administrator also found that the record-keeping violations were
“aggravat[ed]” by the “extraordinary quantities of various highly abused controlled
substances” that Volkman ordered. He was, at times, the largest practitioner-purchaser
of oxycodone in the nation, and the DEA’s 2005 audit revealed that Volkman could not
account for thousands of dosage units. The Deputy Administrator’s finding that
Volkman “authorized the ordering of large quantities of numerous controlled substances,
and that the disposition of these drugs cannot be adequately accounted for because [he]
failed to maintain accurate records,” is thus supported by substantial evidence.
Consequently, the Deputy Administrator properly concluded that Volkman was not
complying with federal regulations requiring dispensers of controlled substances to
maintain accurate and up-to-date records. See 21 U.S.C. § 827(b).

       In sum, the Deputy Administrator considered the Section 823(f) factors in
determining whether Volkman’s Controlled Substances Act registration was in the
public interest.   Based on her finding that Volkman did not comply with Ohio
regulations governing pain management and did not follow federal record-keeping
regulations, she concluded that the Section 823(f) factors weighed against issuing
Volkman a new CSA registration. This determination was supported by substantial
No. 08-3802       Volkman v. Drug Enforcement Administration               Page 15

evidence and was within the scope of authority granted by the Controlled Substances
Act.

                                       IV.

       The DEA’s denial of Volkman’s registration did not exceed the Attorney
General’s authority under the Controlled Substances Act and the determination was
supported by substantial evidence. We therefore DENY Volkman’s petition for review.