Earlier this year there was hope in the food and drug industries that the Supreme Court would revisit and possibly revise the Responsible Corporate Officer Doctrine, also known as the Park Doctrine, by granting certiorari to the Eighth Circuit’s decision in United States v. DeCoster. That hope was dashed in May when the Supreme Court declined, which left the Park Doctrine – with all of its ominous peril – the law of the land.
As a result, officers and managers in the food and drug industries must continue to be vigilant to avoid falling under the ambit of the Park Doctrine. Under the Park Doctrine, any person who “by reason of [their] position” in the company has “responsibility and authority” to take measures to prevent Food, Drug, and Cosmetic Act (“FDCA”) violations – often a CEO or other senior managers – may be held criminally liable and imprisoned for up to a year. This is true even where the person is unaware of the violation or even took action to remedy the problem.
There was optimism that the facts of DeCoster may spur the Supreme Court to rein in this prosecutorial power. In DeCoster, defendants owned and operated an egg production company determined to be the source of a salmonella outbreak. After conviction, they challenged their three-month prison sentences arguing that imprisoning a corporate officer for FDCA violations of which they had no knowledge violates the Due Process Clause of the constitution. It was hoped that framing the challenge that way – that imprisoning people for other individuals’ secret conduct violates fundamental, commonsense fairness – might help it find an audience in the newly arranged Court. But in May 2017, the Supreme Court refused to hear DeCoster on appeal, leaving the Park Doctrine intact.
Despite the Supreme Court’s inaction, there are steps those in the food and drug industries can take to reduce their exposure. First, the reality is that the use of this strict liability criminal statute is relatively rare. In fact, federal prosecutors are required to consult with the Department of Justice in Washington prior to pursuing such charges to allow Main Justice to weigh-in to help ensure this statute is applied appropriately and prudently. Second, and in light of that fact, corporate officers should take efforts to ensure they employ a strenuous compliance program that aims to prevent such violations. The existence of such a program does not eliminate the possibility of criminal charges in the event of a later violation, but, as a practical matter, such a program may help persuade prosecutors to use their discretion to resolve the matter without bringing charges. A valuable resource in assessing the strength of your compliance program is the DOJ’s own guidance in this area: https://www.justice.gov/criminal-fraud/page/file/937501/download.