CHURCH OF SCIENTOLOGY OF CALIF. v. RICHARDSON

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Docket Number

No. 24276.

Attorney(S)

Marvin Zinman (appeared), Los Angeles, Cal., for appellant. Larry Dier (appeared), Asst U.S. Atty., William Matthew Byrne, Jr., U.S. Atty., Frederick M. Brosio, Jr., Chief, Civ. Div., Los Angeles, Cal., for appellees.

Judges

James Marshall Carter

Acts

The Public Health And Welfare — Civil Rights — Generally — Equal Rights Under The Law
The Public Health And Welfare — Civil Rights — Generally — Civil Action For Deprivation Of Rights
Food And Drugs — Federal Food, Drug, And Cosmetic Act — Definitions — Definitions; Generally
Food And Drugs — Federal Food, Drug, And Cosmetic Act — Drugs And Devices — Drugs And Devices — Misbranded Drugs And Devices
Food And Drugs — Federal Food, Drug, And Cosmetic Act — Imports And Exports — Imports And Exports
Food And Drugs — Federal Food, Drug, And Cosmetic Act — Prohibited Acts And Penalties — Seizure

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Smart Summary

Factual and Procedural Background

The appellant, Church of Scientology of California, a California non-profit corporation organized to disseminate Scientology doctrine, sought to import "Hubbard E-meters," devices essential to Scientology practice. The Food and Drug Administration (FDA) refused their importation, deeming the E-meters "devices" under the Federal Food, Drug, and Cosmetic Act that were misbranded due to inadequate instructions for use. The E-meters were seized by Post Office and Customs officials. The appellant received an administrative hearing before the FDA, which upheld the misbranding determination. Subsequently, the appellant filed suit seeking to enjoin the FDA from refusing admission and compelling return of the devices, and sought damages. The district court granted summary judgment for the government. The appellant’s motion for relief from judgment, based on a reversal of the prior condemnation of similar E-meters by the D.C. Circuit Court of Appeals, was denied. The appellant appealed, and this opinion affirms the district court's judgment.

Legal Issues Presented

Whether the E-meter is subject to the Federal Food, Drug, and Cosmetic Act as a "device" requiring adequate instructions for use.
Whether the FDA's determination that the E-meters were misbranded was arbitrary or capricious and thus subject to judicial review.
Whether the seizure and refusal to admit the E-meters violated the appellant’s First Amendment rights regarding religious freedom.
Whether the district court erred in granting summary judgment by failing to consider material issues of fact, including the religious use of the E-meter.

Arguments of the Parties

Appellant's Arguments

The E-meter is used solely in the religious practices of Scientology, and its seizure infringes on religious freedom protected by the First Amendment and civil rights statutes.
The FDA’s refusal to admit the E-meters was improper because the devices are non-injurious and should be exempted from branding requirements.
There were genuine issues of material fact, including the religious use of the E-meter and whether the devices were misbranded, which precluded summary judgment.
The district court improperly relied on the prior condemnation decision in Founding Church of Scientology v. United States, allegedly applying res judicata incorrectly.
The presence of disclaimers on the E-meters negates the misbranding determination.

Appellees' Arguments

The E-meter qualifies as a "device" under the Federal Food, Drug, and Cosmetic Act because it is intended for use in diagnosis or treatment of disease.
The FDA’s determination that the E-meters appeared misbranded was within the Secretary’s discretion and not arbitrary or capricious.
The exercise of religious freedom does not include the right to violate federal law, including importation of misbranded devices.
The district court did not rely on res judicata but considered the prior condemnation decision as a factual matter supporting the FDA’s action.
Disclaimers on some devices do not override extrinsic evidence of intended medical use, supporting the misbranding finding.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Founding Church of Scientology v. United States, 133 U.S.App.D.C. 229, 409 F.2d 1146 (D.C. Cir. 1969), cert. denied 396 U.S. 963 (1969)	Limits on judicial evaluation of religious claims in labeling under 21 U.S.C. § 334(a); distinction between false labeling and inadequate instructions for use.	Referenced to clarify that the court cannot assess truth of religious claims but can determine intended use of a device without infringing First Amendment rights.
United States v. Ellis Research Labs, 300 F.2d 550 (7th Cir. 1962)	Classification of similar skin galvanometers as "devices" under 21 U.S.C. § 321(h) and applicability of branding requirements.	Supported the court’s conclusion that the E-meter is a device subject to the Act’s requirements.
Sugarman v. Forbragd, 405 F.2d 1189 (9th Cir. 1968)	Judicial review of FDA determinations is limited to whether the agency’s action was arbitrary or capricious.	Affirmed that the Secretary’s determination of misbranding is entitled to deference absent arbitrariness.
Drown v. United States, 198 F.2d 999 (9th Cir. 1952)	Devices may be regulated even if harmless, to prevent public harm from reliance on ineffective medical instruments.	Used to reject appellant’s claim that E-meters were harmless and thus exempt from branding requirements.
United States v. Ballard, 322 U.S. 78, 64 S.Ct. 882, 88 L.Ed. 1148 (1944)	Prohibition on courts evaluating truth of religious beliefs under First Amendment.	Cited to support the principle that religious doctrine cannot be judicially assessed for truth or falsity in this context.
Nature Food Centres, Inc. v. United States, 310 F.2d 67 (1st Cir. 1963)	Use of publications to determine intended use of a device without evaluating religious truth claims.	Supported the court’s approach to consider appellant’s literature to determine intended use of the E-meter.
United States v. Article of Drug . . . Capsules, 362 F.2d 923 (3rd Cir. 1966)	Similar to Nature Food Centres; use of extrinsic evidence in determining intended use of drugs or devices.	Reinforced the court’s method of assessing intended use without First Amendment violation.
Alberty Food Prod's v. United States, 194 F.2d 463 (9th Cir. 1952)	Labels disclaiming medical claims are not controlling; extrinsic evidence may establish intended use.	Applied to reject appellant’s reliance on disclaimers as negating misbranding.

Court's Reasoning and Analysis

The court began by affirming that the E-meter qualifies as a "device" under 21 U.S.C. § 321(h) because it is intended for use in diagnosing or treating disease. The FDA’s refusal to admit the devices was based on the determination that they appeared misbranded under 21 U.S.C. § 352(f)(1) due to inadequate instructions for use. The court emphasized that judicial review of the Secretary’s misbranding determination is limited to whether the action was arbitrary or capricious, citing Sugarman v. Forbragd.

The appellant’s argument that the E-meter’s religious use exempts it from the Act was rejected because religious freedom does not permit violation of federal laws. The court distinguished the issue of evaluating religious doctrine from determining intended use of the device, finding that the latter can be assessed without infringing First Amendment rights by presuming the truth of the religious claims and focusing only on the device’s intended function.

The court found ample evidence supporting the FDA’s determination, including appellant’s literature describing diagnostic and therapeutic uses, appellant’s admission that the devices are ineffective medically, absence of adequate instructions on labeling, and prior court decisions. The court rejected the appellant’s contention that disclaimers on some devices negated misbranding, noting that disclaimers are not controlling when extrinsic evidence shows intended medical use.

The appellant’s claim of misapplication of res judicata was denied because the district court did not rely on that doctrine but considered the prior condemnation decision as one factual basis among others. The reversal of that condemnation decision by the D.C. Circuit did not require reversal here.

Ultimately, the court concluded that the district court correctly granted summary judgment because no genuine issues of material fact precluded it, and the FDA’s determination was neither arbitrary nor capricious.

Holding and Implications

The judgment of the district court granting summary judgment for the government is affirmed.

The direct effect of this decision is that the FDA’s refusal to admit the Hubbard E-meters into the United States, based on their appearance as misbranded devices under the Federal Food, Drug, and Cosmetic Act, is upheld. The court’s ruling clarifies that the exercise of religious freedom does not exempt an entity from compliance with federal regulatory statutes governing devices, and that judicial review of agency misbranding determinations is deferential. No new precedent beyond affirming established principles of agency deference and the limits of First Amendment protections in this regulatory context was set.

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The CHURCH OF SCIENTOLOGY OF CALIFORNIA, Plaintiff-Appellant, v. Elliot RICHARDSON et al., Defendants-Appellees. Elliot Richardson has been substituted for his predecessor in office, Robert H. Finch, pursuant to Fed.R.Ci

JAMES M. CARTER, Circuit Judge:

This appeal involves an alleged deprivation of rights protected by the United States Constitution and the Civil Rights Act of 1964 ( 42 U.S.C. § 1981, 1983).

Appellant is a California non-profit corporation, organized for the ostensible purpose of disseminating religious doctrine known as "Scientology." The "Hubbard E-meter" is an instrument that is allegedly essential to the practice of Scientology. The E-meter is manufactured in the United Kingdom and is, in fact, a simple skin galvanometer that crudely measures changes in electrical resistance in the human body. The Food and Drug Administration refused to allow the inportation of E-meters because they were deemed to be "devices" ( 21 U.S.C. § 321(h)) that appeared to be "misbranded" in that they did not bear adequate instructions for use ( 21 U.S.C. § 352(f)(1)). The refusal was based, inter alia, on a successful condemnation action against certain E-meters in the District Court for the District of Columbia [United States v. An Article of Device . . . E-meter (D.C.Civ.No. DC1-1963 (1967))]. The E-meters here in question were seized and detained by Post Office and Customs officials on the ground that they were in violation of the Federal Food, Drug, and Cosmetic Act.

For a thorough presentation of the tenets and practices of "Scientology" see Founding Church of Scientology v. United States (1969) 133 U.S.App.D.C. 229, 409 F.2d 1146.

After the instruments were seized, appellant received a hearing before the Food and Drug Administration in Los Angeles on August 6, 1968. The hearing examiner concluded that the E-meters did not bear adequate instructions for use and, therefore, that they could not be imported into this country. Upon considering the record of the hearing and other available information, the Food and Drug Administration concluded that the E-meter devices appeared to be misbranded within the meaning of 21 U.S.C. § 352(f)(1), as alleged in the notice of seizure, and made the determination of misbranding.

Appellant then filed this suit: (a) to enjoin the F.D.A. from refusing admission of the E-meters into the United States; (b) to enjoin the F.D.A. from compelling the return of the devices to their country of origin; and (c) for $20,000.00 in damages to persons in the class affected. The district court granted the Government's motion for summary judgment. Thereafter, appellant filed a motion for relief from judgment on the basis that, in the interim, the D.C. District Court's earlier condemnation of certain E-meters had been reversed by the D.C. Circuit Court of Appeals in Founding Church of Scientology v. United States, 133 U.S.App.D.C. 229, 409 F.2d 1146, cert. denied 396 U.S. 963, 90 S. Ct. 434, 24 L.Ed.2d 427 (1969). The motion was denied. We affirm.

Discussion

The Government may refuse admission to any "device" offered for importation if it appears to be "misbranded" [ 21 U.S.C. § 381(a)]. The term "device" is defined as "instruments, apparatus, and contrivances * * * intended (1) for use in the diagnosis, cure, mitigation, treatment, or prevention of disease in man * * *. [ 21 U.S.C. § 321(h)]." A device is considered to be "misbranded" if, inter alia, its labeling does not bear adequate directions for use [ 21 U.S.C. § 352(f)].

1. Issues of Fact

Appellant contends that the district court erred in granting summary judgment because there were material issues of fact remaining. Appellant urges that these issues of fact were: (a) whether the E-meter was used in the religious practices of Scientology; and (b) whether the E-meters were misbranded?

The issue of the E-meters' alleged religious use is irrelevant here. The district court held that the exercise of religious freedom does not include the freedom to violate the Federal Food, Drug, and Cosmetic Act. We agree.

The "misbranding" issue can be most accurately described as a question of scope of judicial review. The district court held that the E-meter was a "device" within § 321(h) because it is intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease in man. All "devices" are subject to the Act's branding requirements [ 21 U.S.C. § 352].

The Seventh Circuit upheld the same finding with regard to a similar skin galvanometer in United States v. Ellis Research Labs (7 Cir. 1962) 300 F.2d 550.

Section 381(a) requires only that the device appear to be misbranded, and vests such determinations in the discretion of the Secretary of Health, Education, and Welfare. The Secretary's determination of misbranding is not subject to judicial alteration unless it was arbitrary and capricious. Sugarman v. Forbragd (9 Cir. 1968) 405 F.2d 1189.

First, there were no allegations in the complaint that the Secretary's determination of misbranding was arbitrary or capricious. The real issue tendered by the complaint was an asserted violation of civil rights, to wit religious freedom.

Second, the district court found the action was not arbitrary or capricious. In determining that the E-meters appeared to be misbranded, the Secretary could consider: (a) appellant's literature that contains diagnostic and therapeutic claims for the E-meter; (b) appellant's admission that the devices are ineffective for any medical therapeutic purpose; (c) the absence of instructions for use on the labeling of the devices; and (d) the prior adjudication by the D.C. District Court that the E-meters were in fact misbranded devices. In view of this evidence, the district court concluded that appellant had failed to establish any arbitrary or capricious action by the Secretary. We agree.

Appellant argues that Sugarman's limitation on judicial review is inapplicable here because the Secretary has ignored the Congressional mandate to exempt from the Act's branding requirements any device as to which labeling would not be necessary for the protection of the public health [ 21 U.S.C. § 352(f)]. Appellant contends that E-meters are non-injurious and, therefore, should have been exempted. We think that the Hubbard E-meter is akin to the device in issue in Drown v. United States (9 Cir. 1952) 198 F.2d 999. In Drown, this court held:

"While the instruments may be harmless in themselves, their danger lies in the possibility that `ignorant and gullible persons are likely to rely upon them instead of seeking professional advice for conditions they are represented to relieve or prevent'." [ 198 F.2d at 1006].

In this sense, appellant's E-meters cannot be considered harmless and, therefore, the Act's branding provisions are applicable. See also United States v. Ellis Research Labs. (7 Cir. 1962) 300 F.2d 550.

2. First Amendment Violations

Appellant contends that, in making the determination of "misbranding," the court must have considered and evaluated Scientology's religious literature in violation of its First Amendment rights. The district court found that the appellant had conceded that the E-meter devices were ineffective for any medical or therapeutic purposes. Appellant asserts that the devices are used solely as a confessional aid in Scientology, and that the detention of the devices by the Government unlawfully interferes with appellant's religious freedom.

In Founding Church, supra, the D.C. Circuit held that the court could not constitutionally evaluate the truth or falsity of the medical claims made in Scientology's "religious" literature, citing United States v. Ballard (1944) 322 U.S. 78, 64 S.Ct. 882, 88 L.Ed. 1148. The statute in issue there was 21 U.S.C. § 334(a), which provides that a device is misbranded if its "labeling" bears false or misleading claims. The court reversed the decree of condemnation on the ground that " some of that literature was at least prima facie religious doctrine, and that the jury, as it was instructed, could have found against the E-meter by finding false statements in `labeling' which was at the same time religious doctrine." 409 F.2d at 1164. The court specifically reserved, however, the issue of whether "a drug or device used in a religion is subject to condemnation as `misbranded' if its labeling is found to lack * * * adequate directions for use [ 21 U.S.C. § 352(f)]." 409 F.2d at 1162.

In determining the E-meter's intended use, the court could validly consider the appellant's publications that discuss the device's applications. Nature Food Centres, Inc. v. United States (1 Cir. 1963) 310 F.2d 67; United States v. Article of Drug . . . Capsules (3 Cir. 1966) 362 F.2d 923; Alberty Food Prod's v. United States (9 Cir. 1952) 194 F.2d 463. Unlike the "mislabeling" section involved in Founding Church, the court here could determine the E-meter's intended use without evaluating the truth or falsity of any related "religious" claims. To the contrary, appellant's claims in its literature regarding the applications of the device in the practice of religion were presumed to be true for the purpose of determining its intended use. We find no infringement of First Amendment rights.

3. Potpourri

Appellant contends that the district court misapplied the doctrine of res judicata by allegedly relying completely on the district court result in Founding Church. Appellant is mistaken. The district court's opinion does not contain any mention of the doctrine of res judicata. The court only referred to the district court decision in Founding Church as a fact, among others, that the Government could have reasonably relied upon in deciding to refuse admission to the E-meters pursuant to 21 U.S.C. § 381(a). During the pendency of the appeal in the District of Columbia, such reliance would seem to be quite proper. The subsequent reversal by the D.C. Circuit does not require reversal here, because the doctrine of res judicata was never applied.

Finally, appellant asserts that the E-meters are not misbranded because they bear disclamatory labels, to wit: "Not intended or effective for the diagnosis, treatment, or prevention of any disease." Such labels, however, were found to appear on less than half of the devices seized. Furthermore, labels of disclaimer are not controlling, but are to be considered together with any extrinsic evidence of the device's intended use (e.g. publications, advertisements, etc.) Alberty Food Prod's v. United States (9 Cir. 1952) 194 F.2d 463. There is ample evidence to support the court's finding of the E-meter's intended use.

We find appellant's allegations of error to be without merit. The judgment of the district court is affirmed.