89 F.4th 1
1st Cir.2023Background
- Defendants William Facteau (CEO) and Patrick Fabian (VP Sales) of Acclarent were convicted after a 30-day jury trial of ten misdemeanor counts for introducing an adulterated and misbranded medical device (Relieva Stratus) into interstate commerce in violation of the FDCA; convictions rested on the device being marketed for an off‑label drug‑delivery use (Kenalog) despite only §510(k) clearance as a saline postoperative spacer.
- Stratus was designed and promoted to deliver Kenalog (pore size, training, demos, slides, sales materials), Acclarent sought but failed to obtain FDA clearance for the drug‑delivery indication, yet proceeded to market and train surgeons to use it with Kenalog; sales generated substantial revenue.
- The jury convicted on adulteration and misbranding counts but found no intent to defraud, producing misdemeanor convictions; court fined Facteau $1,000,000 and Fabian $500,000.
- On appeal appellants raised: First Amendment challenges to using promotional speech as evidence of "intended use" (relying on Caronia line), vagueness/due‑process/fair‑warning claims about the regulation of "intended use," instructional errors about what evidence the jury may consider, sufficiency/actus reus challenges tied to particular shipments, and an Eighth Amendment excessive‑fine challenge (Fabian).
- The First Circuit rejected appellants' challenges, holding (inter alia) that evidentiary use of speech to prove intent does not violate the First Amendment, that "intended use" may be proven from any relevant sources (not only external promotional statements), that the regulation is not unconstitutionally vague or retroactively applied, that the evidence was sufficient, and that Fabian's fine was not excessive.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Use of truthful, non‑misleading promotional speech as evidence of "intended use" (First Amendment) | Facteau: jury should be barred from considering truthful off‑label promotional speech as evidence because Caronia protects such commercial speech and FDA safe‑harbors create content/viewpoint discrimination | Government: speech may be used as evidence of intent; Mitchell permits evidentiary use of speech and the prosecution did not criminalize speech itself | Court: Affirmed Mitchell; evidentiary use of speech to prove intent does not implicate First Amendment; district court instruction was proper |
| FDA "safe harbor" / content‑based burden argument | Facteau: FDA guidance shielding some communications but not others imposes a content‑based burden on disfavored speech that triggers heightened scrutiny | Government: argument forfeited; even if considered, safe harbor expands protections and does not impose a constitutionally suspect burden | Court: Forfeited and reviewed for plain error; no clear controlling precedent to find error; safe harbor does not make evidentiary use unconstitutional |
| Jury instruction on "intended use" — whether only external promotional statements count | Fabian: jury should consider only external/promotional conduct; internal documents, design, training, and non‑promotional material irrelevant | Government: 21 C.F.R. §801.4 permits proving objective intent by expressions or circumstances surrounding distribution; all relevant sources may be considered | Court: De novo review — §801.4 and precedent allow any relevant evidence; trial court instruction was correct |
| Vagueness and fair‑warning (Due Process) | Appellants: §801.4 and FDCA are vague because they permit proving intended use from a wide range of sources; post‑Caronia enforcement allegedly broadened coverage without notice | Government: statutes/regulations and FDA communications (including the May 2007 letter) gave adequate notice; precedent supports broad evidentiary sources | Court: Rejected vagueness and retroactivity claims; economic‑regulation vagueness test applies; appellants had actual notice and law was sufficiently definite |
| Sufficiency / actus reus tied to specific shipments | Fabian: government needed evidence that promotional statements accompanied each charged shipment or that he participated in §510(k) filings (actus reus) | Government: actus reus is causing adulterated/misbranded device to enter interstate commerce; evidence of company‑wide scheme and Fabian’s sales role suffices | Court: Affirmed — need not tie promotional materials to each shipment; §331(a) requires causing misbranded/adulterated device to enter commerce, not proof of making the §510(k) filing |
| Excessive fine (Eighth Amendment) — Fabian | Fabian: $500,000 fine is excessive (more than twice Guidelines recommendation) | Government: within statutory maximum; district court provided reasons for upward variance; plain‑error review applies | Court: Plain‑error review fails for defendant; fine is not grossly disproportional and does not violate the Eighth Amendment |
Key Cases Cited
- Wisconsin v. Mitchell, 508 U.S. 476 (1993) (evidentiary use of a defendant's speech to prove motive/intent does not violate the First Amendment)
- United States v. Caronia, 703 F.3d 149 (2d Cir. 2012) (off‑label promotion conviction conflicted with First Amendment on those facts; distinguished by First Circuit)
- Buckman Co. v. Plaintiffs' Legal Comm., 531 U.S. 341 (2001) (FDA premarket regime and agency's role in device regulation)
- United States v. Kordel, 335 U.S. 345 (1948) (labeling/promotional materials can determine intended use in FDCA context)
- United States v. Dotterweich, 320 U.S. 277 (1943) (FDCA misdemeanors impose strict liability on responsible corporate agents)
- United States v. Park, 421 U.S. 658 (1975) (corporate officer liability under public‑welfare statutes for failure to prevent violations)
- Sorrell v. IMS Health Inc., 564 U.S. 552 (2011) (content‑based regulation of speech triggers heightened scrutiny)
- Bajakajian v. United States, 524 U.S. 321 (1998) (Eighth Amendment test for grossly disproportionate fines/forfeitures)
- V.E. Irons, Inc. v. United States, 244 F.2d 34 (1st Cir. 1957) ("intended use" may be proved from all relevant sources)
- United States v. Stepanets, 989 F.3d 88 (1st Cir. 2021) (clarifying elements and actus reus under §331(a))