UNITED STATES OF AMERICA v. BIOANUE LABORATORIES INC et al

Filing 52

ORDER for Response. Within 30 days, the defendants must submit documentation to the Court that details how their proposed new business will comply with the relevant FDA regulations. Ordered by CHIEF DISTRICT JUDGE MARC T TREADWELL on 5/6/2021. (kat)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
MACON DIVISION
UNITED STATES OF AMERICA,
Plaintiff,
v.
BIOANUE LABORATORIES, INC.,
GLORIA D. RABER, and KELLY
RABER,
Defendants.

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CIVIL ACTION NO. 5:13-CV-188 (MTT)

ORDER
Defendants Gloria Raber and Kelly Raber move to vacate the Court’s Order that
permanently restrained and enjoined the defendants from selling any drug or dietary
supplement unless and until certain requirements were met. Docs. 27; 48; 49. Based
on the arguments in the motion (Doc. 48), a letter to the Court (Doc. 49), and the
Government’s response (Doc. 51), the defendants will be allowed an additional
opportunity to reply before the Court rules on the motion.
On May 29, 2013, the Government filed a complaint for injunctive relief against
the defendants, alleging that they violated various provisions of the Federal Food, Drug,
and Cosmetic Act (“the Act”) by misbranding and adulterating unapproved new drugs
and dietary supplements while selling them in interstate commerce. Doc. 1 ¶ 1(a)-(e)
(citing 21 U.S.C. § 331(a), (d), (k)).

On July 23, 2014, the Court granted the Government’s motion for summary
judgment. Doc. 26. The Court concluded that (1) the defendants violated the Act
because their products are “new drugs” that have not been approved by the Food and
Drug Administration (“FDA”) and are not generally recognized as safe and effective; (2)
even if the products were dietary supplements rather than drugs, the defendants “still
have violated the law by not adhering to FDA regulations in their manufacturing process
and causing their food products to become ‘adulterated;’” and (3) Defendant Kelly
Raber acted in concert with BioAnue Laboratories, Inc. and Gloria Raber when
formulating BioAnue products. Id. at 12, 15.
The Court also entered an Order that permanently enjoined the defendants from
selling any drug or dietary supplement unless and until certain requirements were met.
Doc. 27 ¶ 8. These requirements are listed in Paragraph 8 of the Injunction. Id. ¶ 8(A)(J). For the purposes of this Order, the Court quotes in full the language in Paragraph 8
that precedes ¶ 8(A)-(J):
“Upon entry of this Order, Defendants, and each and all of their directors,
officers, agents, representatives, employees, attorneys, successors,
assigns, and any and all person in active concert or participation with any
of them who receive actual notice of this Order by personal service or
otherwise (collectively, “Associated Persons”), are permanently restrained
and enjoined under 21 U.S.C. § 332(a) from introducing or delivering for
introduction, and/or causing to be introduced or delivered for introduction,
into interstate commerce any drug or dietary supplement unless and
until…”
Id. ¶ 8.
The defendants argue that they have been in “full compliance” with the Injunction
for seven years and that their circumstance has “changed greatly.” Doc. 48 at 2. As
part of their changed circumstance, the defendants wanted to open an online store to

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resell dietary supplements that they did not manufacture. Id. at 3. When the
defendants asked for permission to pursue this new venture, the FDA said they were
“prohibited from buying dietary supplements and reselling to the public.” Id. In a letter
to the Court, the defendants say they “fully understand” that they “must comply with the
FDA’s most current policies” if they want to resume manufacturing dietary supplements.
Doc. 49. But the defendants “do not understand … why [they are] banned from selling
dietary supplements that are already on the market—products manufactured and sold
by other FDA-registered companies.” Id. at 1. Specifically, they question “[w]hy [they
are] prohibited from buying a dietary supplement as a wholesaler and selling that
product to consumers [on their] online health food store.” Id.
The Government argues that “the Injunction is necessary to ensure [the
defendants] and any new business continues to follow the laws that [the] Court found
that [they] had previously violated.” Doc. 51 at 2. The Government further argues that
the defendants “ignore[] the fact that the underlying statute and regulations, which the
Injunction enforced, apply to [their] proposed new business.” Id. at 6. The defendants,
according to the Government, “must first comply with the terms of the Injunction before
any proposed new business activity involving the distribution of dietary supplements in
interstate commerce may occur.” Id. The terms include “the sale of third-party
produced dietary supplements” because “[d]istributing dietary supplements, even if
manufactured by a third party, is still ‘introducing’ supplements ‘into interstate
commerce.’” Id.

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The Government points to two sets of requirements of the Injunction and the
Federal Food, Drug, and Cosmetic Act (“FDCA”), 21 U.S.C. § 301 et seq., that the
defendants’ proposed new venture must satisfy.
First, they argue that the proposed business must comply with the Dietary
Supplement cGMP requirements of the Injunction and the FDCA. Id. at 7-8. The
Government argues that 21 C.F.R. § 111.1 applies to the defendants’ new business
because it “would ‘hold’ supplements when it receives them from the manufacturer and
then distribute[] them to consumers through interstate commerce.” Id. at 7. Further, the
Government says that the defendants would have to “maintain a control system that is
designed to ensure supplements are held in a manner that will ensure the quality of the
supplement.” Id. (citing 21 C.F.R. § 111.60). Additionally, the Government argues that
the defendants “must establish and follow written procedures for quality control as
required under 21 C.F.R. Part 111, Subpart F (beginning at § 111.103).” Id. And the
Government says that because of the defendants’ previous violations, the Injunction
requires an expert to confirm the defendants’ compliance with the Dietary Supplement
cGMP regulations. Id. at 8.
Second, the Government argues that the defendants’ proposed business must
conform to the labeling requirements of the Injunction and the FDCA. Id. at 8-10. The
Government argues that the FDCA misbranding provisions “would still apply to [the
defendants’] proposed new business” because “[u]nder the FDCA, labeling is not limited
to statements by the manufacturer, but can include statements made by any entity
introducing the product into interstate commerce.” Id. at 9. (citing 21 U.S.C. § 321(m);
Krobel v. United States, 335 U.S. 345, 349-50 (1948)). According to the Government,

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“[a]ny statements that [the defendants] make[] regarding the dietary supplements that
[they] distribute[]—whether [they] or someone else manufactures them—are ‘labeling’
and must comply with the FDCA.” Id. Finally, like the Dietary Supplement cGMP
regulations, the Government argues that “an expert remains necessary to review any
claims made by [the defendants] about the supplement—regardless of who
manufactures them.” Id.
The defendants did not reply to the Government’s response. Specifically, they
make no effort to show how their new venture will conform to the relevant regulations.
Doc. 49 at 1. Therefore, within 30 days, the defendants must submit documentation to
the Court that details how their proposed new business will comply with the relevant
FDA regulations. 1
SO ORDERED, this 6th day of May, 2021.
S/ Marc T. Treadwell
MARC T. TREADWELL, CHIEF JUDGE
UNITED STATES DISTRICT COURT

The parties make other arguments in the motion to vacate (Doc. 48) and the response (Doc. 51) that the
Court will also address in a separate Order.
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