4-8.000 - Consumer Protection
| 4-8.010 | Introduction |
| 4-8.100 | Persons to Contact at CPB |
| 4-8.200 | Federal Food, Drug, and Cosmetic Act Litigation |
| 4-8.205 | Felony Prosecutions—"Intent to defraud" |
| 4-8.210 | Strict Misdemeanor Liability and “Park” Misdemeanor Liability |
| 4-8.215 | Grand Jury Subpoena Practice |
| 4-8.220 | FDCA Criminal Prosecution of "Black Marketeers" or Drug Diversion |
| 4-8.225 | Prosecutions of Manufacturers of Drugs, Devices, and Biologics |
| 4-8.230 | The Prescription Drug Marketing Act ("PDMA") |
| 4-8.235 | Food Prosecutions |
| 4-8.240 | Motions Commonly Filed |
| 4-8.245 | Jury Charges |
| 4-8.250 | Sentencing Considerations in FDCA Prosecutions |
| 4-8.255 | Indictments and Informations |
| 4-8.260 | Seizures Under the FDCA |
| 4-8.300 | Odometer Fraud Prosecutions |
| 4-8.305 | Recodification of the Odometer Fraud Statutes |
| 4-8.310 | From Investigating to Sentencing |
4-8.010 - Introduction
The Consumer Protection Branch of the Civil Division (“CPB”) is responsible for criminal and civil litigation and related matters arising under the Federal Food, Drug, and Cosmetic Act (“FDCA”) and other federal statutes that protect public health and safety. The Branch also enforces, through civil actions, statutes that regulate unfair and deceptive trade practices, and it defends government programs and policies in consumer-related areas.
CPB, created in 1971, has been central in developing the caselaw under the various consumer protection statutes over which CPB has jurisdiction pursuant to 28 C.F.R. § 0.45(j), and the Branch continues to have expertise in these areas of the law. The statutes identified in 28 C.F.R. § 0.45(j), including the FDCA, give rise to felony and misdemeanor prosecutions, as well as civil cases.
CPB serves several functions for investigations and cases handled by USAOs: (1) to ensure that USAOs do not overlook unique policy or factual concerns that frequently affect litigation under CPB’s statutes; (2) to ensure that USAOs do not have to “reinvent the wheel,” when CPB already has jury instructions, briefs, and other pleadings on relevant points; and (3) to obtain the Assistant Attorney General’s approval as needed before filing cases in these areas.
Often, when an agency partner such as the Food and Drug Administration (“FDA”) refers a matter to CPB, CPB receives the referral and will either retain the matter and handle it itself, or ask a USAO to handle the case, either individually or in partnership with CPB. However, in two areas, USAOs sometimes receive matters directly from investigative agencies without CPB’s involvement. These are matters under the FDCA and the odometer tampering statutes. Accordingly, the sections below will discuss these two types of matters, and requirements for USAOs pursuing these cases.
The statutes assigned specifically to CPB, a complete list of which is located at 28 C.F.R. § 0.45(j), include statutes administered by the FDA, the Federal Trade Commission, the Consumer Product Safety Commission, and the National Highway Traffic Safety Administration.
[updated October 2015]
4-8.100 - Persons to Contact at CPB
Josh Wilkenfeld, Acting Director, (202) 307-3009
Jill Furman, Deputy Director, (202) 307-0090
Andy Clark, Assistant Director, (202) 307-0067
Rich Goldberg, Assistant Director, (202) 307-2532
Jeffrey Steger, Assistant Director, (202) 307-0047
[updated July 2017]
4-8.200 - Federal Food, Drug, and Cosmetic Act Litigation
USAOs must notify and consult with the CPB upon opening any civil or criminal investigation (including securing a search warrant) into possible violations of the FDCA, 21 U.S.C. 301, et seq. Notice and consultation is provided through the contact numbers at USAM 4-8.100. CPB will confirm receipt of and respond to the notification from the USAO within 15 business days. The USAO and CPB should consult as to what role, if any (e.g., non-monitored, monitored, jointly handled, or other), CPB will play in the matter. CPB may elect to monitor investigations and cases that are not jointly handled and that it deems to have nationwide implications, based on the facts or the law.
Investigations and cases that have nationwide implications may include, but are not limited to, instances in which:
- a publicly traded corporation is a criminal target or criminal defendant;
- a subject or target raises the possibility that the First Amendment is a defense to any liability to which their actions may give rise;
- a subject’s or target’s individual liability, criminal or civil, is based on the “responsible corporate officer” doctrine (the so-called Park doctrine);
- the conduct at issue led to death or other serious bodily injury;
- the amount of any criminal fine, forfeiture, disgorgement, and/or restitution or of any civil penalty may exceed $100 million; and
- the conduct at issue involves fraud on or misleading the FDA.
For monitored matters, CPB may request status updates on the matter’s progress and legal and factual theories. At least 15 business days before filing a civil complaint or criminal charges in a monitored matter, a USAO must notify and consult with CPB regarding the factual and legal basis for, and potential nationwide implications of, the charges. Throughout the course of monitored matters, USAOs are required to report to CPB significant matters of FDCA policy and interpretation, questions of first impression concerning the FDCA, and any adverse court decisions.
For non-monitored matters, continued consultation with CPB throughout the course of the investigation’s and matter’s development is encouraged but not required. However, a USAO handling a non-monitored matter should notify and consult with CPB if a court issues an adverse decision concerning the FDCA or if, based on new facts, allegations, legal theories or other developments, the matter now raises novel or significant legal or policy issues under the FDCA or other issues of national importance.
As reflected in the U.S. Attorney Procedures manual, attorneys from the FDA may not be appointed as Special Assistant U.S. Attorneys without the approval of CPB’s Director.
The discussions below focus on the major types of FDCA cases and significant issues that are common to most FDCA matters.
[updated October 2015]
4-8.205 - Felony Prosecutions—"Intent to defraud"
Any person or entity that commits a prohibited act set forth in 21 U.S.C. § 331 violates the FDCA. A person or entity committing such an act “with the intent to defraud or mislead” is guilty of a three-year felony. 21 U.S.C. § 333(a)(2). Intent to defraud or mislead can be established by demonstrating a fraud upon either the ultimate consumer of the product, or upon the FDA, or both. That is, a person or entity whose fraudulent conduct is directed at the FDA, as is common in black market and other contexts, is guilty of felony behavior, and should be prosecuted on that basis.
Consultation with CPB required under USAM 4-8.200 will ensure USAOs have access to the most recent developments in this area.
[updated October 2015]
4-8.210 - Strict Misdemeanor Liability and “Park” Misdemeanor Liability
A misdemeanor conviction under the FDCA, unlike a felony conviction, does not require proof of fraudulent intent, or even of knowing or willful conduct. CPB attempts wherever possible to bring felony charges to deal with fraudulent behavior. Nevertheless, misdemeanor liability can attach to behavior that, due to lack of proof or other problems with a case or defendant, may not merit felony prosecution. What is more, an individual who stands in responsible relation to the violative conduct, even if he or she did not engage in the conduct itself, may be liable under the “responsible corporate officer” doctrine (the so-called Park doctrine). Consultation with CPB required under USAM 4-8.200 will ensure USAOs have access to the most recent developments in this area.
[updated October 2015]
4-8.215 - Grand Jury Subpoena Practice
Contact CPB for model subpoenas and practice tips for a FDCA investigation. Consultation with CPB required under USAM 4-8.200 will ensure USAOs have access to the most recent developments in this area.
[updated October 2015]
4-8.220 - FDCA Criminal Prosecution of "Black Marketeers" or Drug Diversion
Common black markets in unapproved pharmaceuticals include performance enhancing drugs (such as steroids), lifestyle drugs (such as erectile dysfunction drugs), and various animal drugs. Agents sometimes suggest conducting “buy-bust” scenarios as are common with controlled substances. Consultation with CPB required under USAM 4-8.200 will ensure USAOs have access to the most recent developments in this area.
[updated October 2015]
4-8.225 - Prosecutions of Manufacturers of Drugs, Devices, and Biologics
FDA commonly coordinates complex investigations involving the industries it regulates through CPB. Consultation with CPB required under USAM 4-8.200 will ensure USAOs have access to the most recent developments in this area.
[updated October 2015]
4-8.230 - The Prescription Drug Marketing Act ("PDMA")
The Prescription Drug Marketing Act (“PDMA”) deals with a “grey market” in prescription drugs. This grey market includes diverted sample drugs and diverted drugs originally sold to hospitals. The PDMA is codified in the FDCA, with prohibited acts listed at 21 U.S.C. § 331(t). The PDMA is a complex statute with numerous exceptions. CPB will provide advice and assist in developing an effective case strategy. Consultation with CPB required under USAM 4-8.200 will ensure USAOs have access to the most recent developments in this area.
[updated October 2015]
4-8.235 - Food Prosecutions
CPB has litigated large-scale prosecutions of those responsible for the sale of adulterated foods. CPB has also litigated numerous prosecutions in which a food was “stretched” with cheaper ingredients that are difficult to detect, leading consumers to pay higher prices for lower quality foods. Where evidence of fraud exists, the deliberate cheating of consumers in this fashion should be prosecuted under the felony provisions of the FDCA, or as mail or wire fraud, or both. Consultation with CPB required under USAM 4-8.200 will ensure USAOs have access to the most recent developments in this area.
[updated October 2015]
4-8.240 - Motions Commonly Filed
Defendants commonly challenge FDCA indictments alleging a variety of defects that the courts have held do not exist. Consultation with CPB required under USAM 4-8.200 will ensure
USAOs have access to the most recent developments in this area.
[updated October 2015]
4-8.245 - Jury Charges
Consultation with CPB required under USAM 4-8.200 will ensure USAOs have access to the most recent jury instructions.
[updated October 2015]
4-8.250 - Sentencing Considerations in FDCA Prosecutions
Any violation of the FDCA committed with “intent to defraud or mislead” is a felony. 21 U.S.C. § 333(a)(2). In virtually all felony FDCA prosecutions, U.S.S.G. § 2B1.1 is the applicable Chapter Two offense guideline by virtue of the cross-reference at U.S.S.G. § 2N2.1(b)(1). Section 2N2.1 applies to FDCA misdemeanors, which do not involve fraud. In structuring any FDCA investigation, consideration must be given to issues affecting sentencing, such as identifying the persons defrauded and the risk to public health. Particular effort should be made to learn the full extent of the fraud. Defendants have been sentenced to significant incarceration based largely on the amount of fraud. Consultation with CPB required under USAM 4-8.200 will ensure USAOs have access to the most recent developments in this area.
[updated October 2015]
4-8.255 - Indictments and Informations
Consultation with CPB required under USAM 4-8.200 will ensure USAOs have access to the most recent samples of charging documents.
[updated October 2015]
4-8.260 - Seizures Under the FDCA
FDA routinely recommends seizure actions under the FDCA (authorized by 21 U.S.C. § 334) by direct referral to USAOs. Most of these actions are routine, involving filthy storage conditions at food warehouses, and similar clear violations of the FDCA. However, some seizure recommendations are based on novel or difficult theories under the FDCA. Consultation with CPB required under USAM 4-8.200 will ensure USAOs have access to the most recent developments in this area.
[updated October 2015]
4-8.300 - Odometer Fraud Prosecutions
CPB should be contacted when an odometer fraud investigation is opened so that information regarding potential overlaps with other cases can be shared. CPB should also be provided a copy of any proposed indictment or information at least one week before presentation or filing, so that necessary approvals can be obtained. In general, unless a USAO requests more active assistance on such investigations, CPB will merely monitor the case thereafter. See the Civil Resource Manual at 149 for a discussion of the agencies involved in these matters, who should be contacted, and investigative resources available through CPB.
4-8.305 - Recodification of the Odometer Fraud Statutes
In 1994, the odometer tampering statutes were recodified from Title 15, U.S.C., to Title 49. The changes were not substantive, though the statutes were reworded. The precedential value of caselaw citing the Title 15 statutes is not affected by the change. See the Civil Resource Manual at 150 for a detailed description of the recodification, and at 151 for the text of the former Title 15 offenses.
[updated April 2009]
4-8.310 - From Investigating to Sentencing
Included in the Civil Resource Manual are a variety of materials that will serve as resources and models for every step in an odometer fraud case. Included are guides for investigations, computerization help, sample indictments, trial briefs, responses to motions, and matters relevant to sentencing.
| Other Offenses Commonly Charged | Odometer tampering implicates several federal criminal statutes. It is generally desirable to charge defendants with offenses in addition to odometer fraud. Such charges more accurately depict the totality of the illegal conduct, and provide theories of liability that may lead to conviction where, for example, a jury is not convinced that a defendant was responsible for some aspect of the conduct reflected in a single count. Included is a discussion of the types of charges that can be alleged with odometer tampering charges, along with some pertinent citations. | Civil Resource Manual 152 |
| Subpoenas to "Targets"—Forensic Evidence | Forensic evidence is frequently effective. Targets often forge other people's writing to conceal their role in a scheme. It is advisable to obtain handwriting exemplars from targets. In addition, fingerprints may remain on a fraudulent document. No Fifth Amendment privilege protects handwriting, fingerprints, or photographs. There should be no reluctance to subpoena such items. Sample language for a subpoena is included. | Civil Resource Manual 153 |
| Subpoenas to "Targets"—Required Records | It is good practice to subpoena targets for records relating to purchase and sale of automobiles, including odometer statements. Because such documents are "required records" for a used car dealer, targets cannot assert their Fifth Amendment privilege in resisting a subpoena seeking such materials. | Included in the Civil Resource Manual are a sample target subpoena at 153, an appeal brief from a "required records" case at 154, and a letter that can be sent to counsel explaining why a target must provide "required records" to the grand jury at 155. |
| Indictments | Indictments charging one or more of the following crimes: conspiracy under 18 U.S.C. § 371, securities fraud under 18 U.S.C. § 513, mail fraud under 18 U.S.C. § 1341, the interstate transportation of falsely made, forged, altered, or counterfeited securities under 18 U.S.C. § 2314, odometer rollbacks/false mileage statements under 49 U.S.C. §§ 32703(2), 32705(a)(2) and 32709(b), money laundering under 18 U.S.C. § 1957, and asset forfeiture under 18 U.S.C. § 982. The indictment in Civil Resource Manual 174 has charges specifically related to replacing rather than resetting odometers. | Civil Resource Manual 156-158, 173-174 |
| Trial Briefs | Trial briefs can explain unusual aspects of odometer fraud trials. The samples explain evidence from auto auctions, dealer records, and titling documents and procedures. They also lay out theories such as Pinkerton, and evidentiary matters, such as that title histories are self- authenticating, and the admissibility of summary charts, plea agreements, and video and audio tapes. | Civil Resource Manual 159-161 |
| Jury Instructions | Sample jury instructions from odometer tampering cases are included. | Civil Resource Manual 162 |
| Commonly Filed Defense Motions | Deals with the sufficiency of proof of mailing as to conspiracy to commit mail fraud counts, and with the adequacy of a state department of motor vehicle mailing of a title as satisfying the mailing element. | Civil Resource Manual 163 |
| An omnibus response in a multi-defendant odometer fraud prosecution. Included (Section B starting at p. 12) is an analysis of why odometer tampering, mail fraud, and ITSP are properly charged as separate offenses. | Civil Resource Manual 164 | |
| Proposed findings that can be used to support a complex case finding and exclusion of time under the Speedy Trial Act. | Civil Resource Manual 165 | |
| Brief arging that false odometer certifications, securities fraud, and mail fraud counts are not multiplicitous. | Civil Resource Manual 166 | |
| Restitution and Victim Notification | Restitution for consumers should be sought when possible, though the defendant's resources frequently limit restitution. The need for restitution must be considered in choosing charges. Restitution orders should ordinarily use loss figures developed under U.S.S.G. § 2F1.1. In addition, victims should be notified of the rollbacks. 42 U.S.C. § 10607. Included at the end of the discussion is a motion and order that can be used to obtain a Fed. R. Crim. P. 6(e) order related to victim notification. | Civil Resource Manual 167-169 |
| Evaluating the "Amount of Loss" for sentencing in odometer fraud cases | Odometer fraud cases are sentenced under the fraud guideline. The most commonly litigated issues are the number of vehicles to attribute to the defendant, and the loss per vehicle to use in arriving at a total loss figure. CPB has developed a variety of analyses that are useful in this regard for obtaining loss findings that properly reflect the impact on consumers of odometer fraud schemes. A description of, and guide to, these materials is included. | Civil Resource Manual 170 |
[updated April 2009]