Oak Hill Hometown Pharmacy v. Dhillon
2:19-cv-00716
S.D.W. VaDec 23, 2019Background
- The DEA issued an Order of Immediate Suspension (ISO) of Oak Hill Hometown Pharmacy’s registration; the pharmacy filed for emergency relief and the court held expedited hearings in October 2019.
- On October 30, 2019 the court dissolved the ISO, concluding the DEA had not shown the statutory requirement of an "imminent danger to public health and safety."
- Respondents (Uttam Dhillon and the DEA) moved under Fed. R. Civ. P. 59(e) to alter or amend the October 30 judgment, submitting a newly certified administrative record and a DEA declaration.
- The court found the newly certified administrative record qualified as "new evidence" (the TRO process had been expedited and a full certified record was not then before the court).
- After reviewing the administrative record, the court concluded the new materials largely repackaged prior evidence, contained no proof of actual abuse or diversion at the time the ISO issued, and did not establish the statutory "imminent" threat required to sustain an ex parte ISO.
- The court denied the Rule 59(e) motion because the new record was unlikely to produce a different outcome and the respondents improperly sought to relitigate the merits rather than show the narrow grounds for relief under Rule 59(e).
Issues
| Issue | Plaintiff's Argument (Pharmacy) | Defendant's Argument (DEA/ Dhillon) | Held |
|---|---|---|---|
| Whether the newly certified administrative record is "new evidence" under Rule 59(e) | The TRO posture prevented a certified record; any subsequently certified record is new and should be considered | The record was available to DEA earlier and should have been before the court; not new | Court: The certified administrative record is new evidence (expedited TRO hearings justified earlier absence) |
| Whether the new evidence would likely change the October 30 judgment | The dissolution was correct; any new record would not show imminent danger | The administrative record contains material not previously considered and would show imminent danger, requiring amendment and further proceedings | Court: The new evidence would not likely change the outcome; judgment stands |
| Proper standard of review for an ISO issued ex parte | De novo review appropriate given lack of administrative process and statutory grant of district court jurisdiction | DEA argued different framing of the proper standard; mischaracterized court’s rationale | Court: De novo review was appropriate here; DEA’s disagreement does not justify Rule 59(e) relief |
| Persuasiveness of DEA administrative decisions and PDMP/other data | The prior evidence and new administrative decisions support finding of red flags and diversion risk | DEA relied on administrative decisions and PDMP to show red flags and risk of diversion | Court: Those administrative decisions are materially dissimilar (different statutes/contexts and different controlled substances) and do not establish imminent harm |
Key Cases Cited
- Pac. Ins. Co. v. Am. Nat. Fire Ins. Co., 148 F.3d 396 (4th Cir. 1998) (standards and narrow grounds for Rule 59(e) relief)
- Boryan v. United States, 884 F.2d 767 (4th Cir. 1989) (new evidence must be likely to produce a different outcome to amend judgment)
- Norman Bridge Drug Co. v. Banner, 529 F.2d 822 (5th Cir. 1976) (district courts are competent jurisdiction to review and dissolve ISOs)
- Novelty Distributors, Inc. v. Leonhart, 562 F. Supp. 2d 20 (D.D.C. 2008) (district court review of DEA emergency suspension procedure)
- AT&T Info. Sys., Inc. v. Gen. Servs. Admin., 810 F.2d 1233 (D.C. Cir. 1987) (permitting consideration of background material that explains the administrative record)
- Hutchinson v. Staton, 994 F.2d 1076 (4th Cir. 1993) (Rule 59(e) relief grounds)
- Small v. Hunt, 98 F.3d 789 (4th Cir. 1996) (justification required for not presenting new evidence earlier)