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Abbott Laboratories v. Gardner

No. 39

Argued January 16, 1967

Decided May 22, 1967

387 U.S. 136

CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

Syllabus

The Commissioner of Food and Drugs, exercising authority delegated to him by the Secretary of Health, Education, and Welfare, issued regulations requiring that labels and advertisements for prescription drugs which bear proprietary names for the drugs or the ingredients carry the corresponding "established name" (designated by the Secretary) every time the proprietary or trade name is used. These regulations were designed to implement the 1962 amendment to § 502(e)(1)(B) of the Federal Food, Drug, and Cosmetic Act. Petitioners, drug manufacturers and a manufacturers' association, challenged the regulations on the ground that the Commissioner exceeded his authority under the statute. The District Court granted the declaratory and injunctive relief sought, finding that the scope of the statute was not as broad as that of the regulations. The Court of Appeals reversed without reaching the merits, holding that pre-enforcement review of the regulations was unauthorized and beyond the jurisdiction of the District Court, and that no "actual case or controversy" existed.

Held:

1. Preenforcement review of these regulations is not prohibited by the Federal Food, Drug, and Cosmetic Act. Pp. GO>139-148.

(a) The courts should restrict access to judicial review only upon a showing of "clear and convincing evidence" of a contrary legislative intent. GO>Rusk v. Cort, 369 U.S. 367, GO>379-380. Pp. GO>139-141.

(b) The statutory scheme in the food and drug area does not exclude pre-enforcement judicial review. Pp. GO>141-144.

(c) The special review provisions of § 701(f) of the Act, applying to regulations embodying technical factual determinations, were simply intended to assure adequate judicial review of such agency decisions, and manifest no congressional purpose to eliminate review of other kinds of agency action. P. GO>144. [387 U.S. 137]

(d) The saving clause of § 701(f)(6), which states that the "remedies provided for in this subsection shall be in addition to and not in substitution for any other remedies provided by law," does not foreclose pre-enforcement judicial review, and should be read in harmony with the policy favoring judicial review expressed in the Administrative Procedure Act and court decisions. Pp. GO>144-146.

(e) GO>Ewing v. Mytinger & Casselberry, Inc., 339 U.S. 594, which did not concern the promulgation of a self-operative industry-wide regulation, distinguished. Pp. GO>146-148.

2. This case presents a controversy "ripe" for judicial resolution. Pp. GO>148-156.

(a) The issue of statutory construction is purely legal, and the regulations are "final agency action" within § 10 of the Administrative Procedure Act. GO>Columbia Broadcasting System v. United States, 316 U.S. 407, and similar cases followed. Pp. GO>149-152.

(b) The impact of the regulations upon petitioners is sufficiently direct and immediate as to render the issue appropriate for judicial review at this stage. Pp. GO>152-154.

(c) Here, the pre-enforcement challenge by nearly all prescription drug manufacturers is not calculated to delay or impede effective enforcement of the Federal Food, Drug, and Cosmetic Act. Pp. GO>154-155.

352 F.2d 286, reversed and remanded.

Excerpts from Majority Opinion by Justice Harlan

….

The first question we consider is whether Congress, by the Federal Food, Drug, and Cosmetic Act, intended to forbid pre-enforcement review of this sort of regulation [387 U.S. 140] promulgated by the Commissioner. The question is phrased in terms of "prohibition", rather than "authorization," because a survey of our cases shows that judicial review of a final agency action by an aggrieved person will not be cut off unless there is persuasive reason to believe that such was the purpose of Congress.

….

The injunctive and declaratory judgment remedies are discretionary, and courts traditionally have been reluctant to apply them to administrative determinations unless these arise in the context of a controversy "ripe" for judicial resolution. Without undertaking to survey the intricacies of the ripeness doctrine{GO>15} it is fair to say that its basic rationale is to prevent the courts, through avoidance of premature adjudication, from entangling themselves in abstract disagreements over administrative policies, and also to protect the agencies from judicial interference until an administrative decision has been formalized and its effects felt in a concrete way by the challenging [387 U.S. 149] parties. The problem is best seen in a two-fold aspect, requiring us to evaluate both the fitness of the issues for judicial decision and the hardship to the parties of withholding court consideration.

As to the former factor, we believe the issues presented are appropriate for judicial resolution at this time. First, all parties agree that the issue tendered is a purely legal one: whether the statute was properly construed by the Commissioner to require the established name of the drug to be used every time the proprietary name is employed.{GO>16} Both sides moved for summary judgment in the District Court, and no claim is made here that further administrative proceedings are contemplated. It is suggested that the justification for this rule might vary with different circumstances, and that the expertise of the Commissioner is relevant to passing upon the validity of the regulation. This, of course, is true, but the suggestion overlooks the fact that both sides have approached this case as one purely of congressional intent, and that the Government made no effort to justify the regulation in factual terms.

Second, the regulations in issue we find to be "final agency action" within the meaning of § 10 of the Administrative Procedure Act, 5 U.S.C. § 704, as construed in judicial decisions. An "agency action" includes any "rule," defined by the Act as "an agency statement of general or particular applicability and future effect designed to implement, interpret, or prescribe law or policy," §§ 2(c), 2(g), 5 U.S.C. §§ 551(4), 551(13). The cases dealing with judicial review of administrative actions have interpreted the "finality" element in a pragmatic way.

….

This is also a case in which the impact of the regulations upon the petitioners is sufficiently direct and immediate as to render the issue appropriate for judicial review at this stage. These regulations purport to give an authoritative interpretation of a statutory provision that has a direct effect on the day-to-day business of all prescription drug companies; its promulgation puts petitioners in a dilemma that it was the very purpose of the Declaratory Judgment Act to ameliorate.{GO>18} As the District Court found on the basis of uncontested allegations,

Either they must comply with the every time requirement and incur the costs of changing over their promotional material and labeling or they must follow their present course and risk prosecution.

…..”