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United States v. Crescent-Kelvan Co.

decided: January 26, 1948.

UNITED STATES
v.
CRESCENT-KELVAN CO. ET AL.



Author: Biggs

Before BIGGS, ALBERT LEE STEPHENS and MARIS, Circuit Judges.

BIGGS, Circuit Judge.

The information in the case at bar charges Crescent-Kelvan Company and the individual defendants in two separate counts with violations of the Federal Food, Drug, and Cosmetic Act of June 25, 1938, c. 675, Section 1 et seq., 52 Stat. 1040 (1938), 21 U.S.C.A. § 301 et seq.

The first count charges that the defendants caused to be shipped in interstate commerce is drug, known by the trade name of "Methosol", adulterated within the purview of Section 501(a)(4) of the Act, 21 U.S.C.A. § 351(a)(4) in that it contained, for purpose of coloring only, a coal-tar color, "Butter Yellow", actually dimethylamina-azobenzene, which had not been certified for use in accordance with the regulations*fn1 promulgated under Section 504 of the Act, 21 U.S.C.A. § 354. The defendants do not contend that the drug was not within the purview and prohibition of the statute. Their defenses lie on other grounds which will be dealt with hereinafter.

The second count charges a violation of Section 502(e) of the Act, 21 U.S.C.A. § 352(e), in that the defendants caused to be shipped in interstate commerce certain capsules in a bottle labeled in pertinent part as follows: "1000 (Capsules) BENZ-CAL-CIN, Trade Mark, Chemical Combination Benzoinated-Phenyl Cinchoninic Acid and Calcium. * * * Each capsule represents Phenyl cinchoninic acid approximately two grains". The gravamen of the charge in the count is misbranding in that the drug, "Benz-Cal-Cin", a fabrication of two or more ingredients, was not designated solely by a name recognized in an official compendium, the label on the bottle failing to bear the common or used name of each active ingredient, viz., free cinchophen and cinchophen in chemical combination. The defendants contend that the name on the label, "phenylcinchoninic acid", was a common or usual name of the drug.

The facts as shown by the evidence are as follows: While the precise status of Crescent-Kelvan Company cannot be ascertained from the record, it is described in the information as "an association existing as a business trust under the laws of the Commonwealth of Pennsylvania * * *". The learned trial judge in his charge told the jury that it was an "association", and that an association "simply means that they operate as a business trust, which they can properly do under the laws of the Commonwealth of Pennsylvania." Exhibit G-7, a bill of the Crescent-Kelvan Company, states that it is "A Trust", and that the defendant Roach is its president and that the defendant Lambert is its secretary-treasurer, while M. W. Lambert is shown as "Trustee". It was stipulated by counsel that if the Prothonotary of the Court of Common Pleas, Philadelphia County, were to testify he would produce a certificate, June Term, 1941, C.P. No. 3, 475, signed by Roland J. Christy, dated August 27, 1941, registering under the fictitious name, Crescent-Kelvan Company, which was characterized as "Chemists to the Medical Professions * * *" and filed by the defendant Lambert as treasurer. We think it may be assumed in the light of the foregoing that Crescent-Kelvan Company was registered under the Pennsylvania Fictitious Names Act, 54 P.S. Pa. § 21 (1930), and that it is a "Massachusetts trust" of the sort referred to by the Supreme Court of Pennsylvania in Pennsylvania Company, etc., v. Wallace, 346 Pa. 532, 31 A.2d 71, 156 A.L.R. 1. In any event it is clear that the defendant Roach purported to act as the president of Crescent-Kelvan Company and that the defendant Lambert purported to act as its secretary-treasurer, that the individual defendants were in charge of the books, records and premises of Crescent-Kelvan Company and that their acts on behalf of it are sufficient to bind the "Trust".

In March, 1944, an inspector of the Philadelphia Station of the Food and Drug Administration Came to the plant of Crescent-Kelvan Company where the individual defendants were in charge, and inspected the premises. Wagner, the inspector, testified that the inspection was made to ascertain the use by Crescent-Kelvan Company of coal-tar colors in drug products and that he found in the plant a package labeled "D & O,*fn2 4 oz. color, No. 304, for technical use only."; that he was informed that this coal-tar color was used in the defendant's product "Methosol"; that he took a sample therefrom, without objection from the individual defendants, offering to pay for it, an offer which was refused.

Wagner further testified that thereafter he inspected the shipping records of Crescent-Kelvan Company and found that Methosol had been shipped by it to a physician in Maryland, and that Benz-Cal-Cin capsules had been shipped to another doctor in the same State. The two doctors testified that they had received respectively from Crescent-Kelvan Company by parcel post Methosol and Benz-Cal-Cin capsules. There was further testimony by an agent of the Administration that samples of these drugs had been procured from the physicians. Chemists employed by the Administration testified that the Methosol thus procured contained the prohibited coal-tar coloring Butter Yellow and that the Benz-Cal-Cin capsules contained free cinchophen and cinchophen in chemical combination.

The jury found all defendants guilty on the counts of the information and the court entered judgments of sentence imposing a fine on Crescent-Kelvan Company and sentencing the individual defendants to both fine and imprisonment, the sentences of imprisonment, however, being suspended and the individual defendants being placed upon probation. All the defendants have appealed.

Substantially all of the testimony offered by the United States*fn3 was subject to repeated objections by the defendants. This brings us immediately to a discussion of the first point raised by them as grounds for reversal. The inspector of the Food and Drug Administration entered the premises of Crescent-Kelvan Company without a search warrant. The defendants assert that they were deprived of the rights guaranteed to them by the Fourth Amendment of the Federal Constitution and that their effects were subjected to unreasonable search and seizure because the inspector made the inspection without a search warrant, because he obtained a sample of the prohibited coal-tar color and, above all, because he inspected the shipping records from which the names of the Maryland doctors were obtained. This inspection of course led ultimately to samples of Methosol and Benz-Cal-Cin capsules being introduced into evidence at the trial.

Passing by the question as to whether or not the guarantees of the Fourth Amendment may be invoked by a "Trust" such as that at bar, a question which we need not answer, we find it unnecessary to deal with the defendants' contentions at length for the following reasons. Section 704 of the Act, 21 U.S.C.A. § 374, provides the officers designated by the Administrator, after first making a request and obtaining permission of the owner, or custodian are authorized to enter, at reasonable times, any factory in which drugs are manufactured, processed, packed or held, for introduction to interstate commerce; and to inspect, at reasonable times, such factory and all pertinent equipment, finished and unfinished materials, containers and labeling therein.

It is not contended that the inspector came upon the premises at an unreasonable time or forced his way into Crescent-Kelvan Company's plant. It is clear from the testimony that whether the inspector expressly requested leave to enter and received such permission from the individual defendants who were in fact in charge of the premises, leave and permission to enter were tacitly granted to the inspector by the individual defendants. Under the statute the inspector had the right to examine the package containing the prohibited coal-tar color, Butter Yellow. But even if the inspector had no express right under the statute to take a sample of the coal-tar color, the individual defendants consented and acquiesced in that taking. It is manifest also that whether or not the statute conferred upon the inspector the right to examine the shipping records of Crescent-Kelvan Company, permission to make such an inspection was implicitly granted to them by the individual defendants then present*fn4 who had the right to bind the "Trust". We find it unnecessary, therefore, to embark upon a discussion of the authority granted to the inspector by the statute.

We entertain no doubt that Section 704 is constitutional.Its provisions are bottomed upon the policy power of the United States as exercised under the Commerce Clause of the Constitution for the protection of the public health.*fn5 See McDermott v. Wisconsin, 228 U.S. 115, 128, 33 S. Ct. 431, 57 L. Ed. 754, 47 L.R.A.,N.S., 984, Ann.Cas.1915A, 39; Hipolite Egg Co. v. United States, 220 U.S. 45, 47, 31 S. Ct. 364, 55 L. Ed. 364, and Seven Cases v. United States, 239 U.S. 510, 36 S. Ct. 190, 60 L. Ed. 411, L.R.A.1916D, 164. No constitutional right is violated by a statute, an ordinance or a regulation providing for the inspection of places of business, dealing with drugs or foods during business hours. See Keiper v. City of Louisville, 152 Ky. 691, 154 S.W. 18; State ex rel. Melton v. Nolan, 161 Tenn. 293, 30 S.W.2d 601, and the authorities collected in 47 Am.Jur. pp. 508-510. By its express terms Section 704 provides for inspection of factory premises only after first obtaining permission from the custodian thereof. The section is paterned on Section 3601 of the Internal Revenue Code, 26 U.S.C.A. Int.Rev.Code, § 3601, and the authority exercised under that statute has never been regarded as violative of the guarantees of the Fourth Amendment.See Cooper v. United States, 3 Cir., 299 F. 483; United States v. Vlahos, D.C., 19 F.Supp. 166; In re Meader, 16 Fed.Cas. page 1294, No. 9,375. See also United States v. Barnes, 222 U.S. 513, 32 S. Ct. 117, 56 L. Ed. 291, and McDermott v. Wisconsin, 228 U.S. 115, 33 S. Ct. 431, 57 L. Ed. 754, 47 L.R.A.,N.S., 984, Ann.Cas.1915A, 39. The inspector in examining the premises and the shipping records of Crescent-Kelvan Company did not act which constituted a violation of the Fourth Amendment.

Other grounds asserted by the defendants, however, require reversal of the judgments of conviction and a new trial. These grounds go to the sufficiency of the charge.This subject requires a brief discussion of the offense laid in the second count of the information and of the terms of the statute alleged to have been violate.*fn6 As we already stated the second count of the information is based on an alleged violation of Section 502(e) of the Act which provides that a drug shall be deemed to be misbranded "If it is a drug and is not designated solely by a name recognized in an official compendium unless its label bears * * * in case it is fabricated from two or more ingredients, the common or usual name of each active ingredient * * *". The drug contained in the Benz-Cal-Cin capsules was not designated "solely" by a name recognized in an official compendium since it was described by the name "Benz-Cal-Cin", a trade name, and also was designated as a chemical combination, "Benzoinated-Phenyl Cinchoninic Acid and Calcium". The evidence presented shows that Benz-Cal-Cin was fabricated from two or more ingredients. Therefore, under the terms of the statute the active ingredient or ingredients should have been designated by their respective "common or usual" ...


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