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.
387 U. S.
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.
Rusk v. Cort, 369 U.
S. 367,
369 U. S.
379-380. Pp.
387 U. S.
139-141.
(b) The statutory scheme in the food and drug area does not
exclude pre-enforcement judicial review. Pp.
387 U. S.
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.
387 U. S.
144.
Page 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.
387 U. S.
144-146.
(e)
Ewing v. Mytinger & Casselberry, Inc.,
339 U. S. 594,
which did not concern the promulgation of a self-operative
industry-wide regulation, distinguished. Pp.
387 U. S.
146-148.
2. This case presents a controversy "ripe" for judicial
resolution. Pp.
387 U. S.
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.
Columbia Broadcasting System v.
United States, 316 U. S. 407, and
similar cases followed. Pp.
387 U. S.
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.
387 U. S.
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.
387 U. S.
154-155.
352 F.2d 286, reversed and remanded.
MR. JUSTICE HARLAN delivered the opinion of the Court.
In 1962, Congress amended the Federal Food, Drug, and Cosmetic
Act (52 Stat. 1040, as amended by the Drug Amendments of 1962, 76
Stat. 780, 21 U.S.C. § 301
et seq.), to require
manufacturers of prescription drugs to print the "established name"
of the drug "prominently
Page 387 U. S. 138
and in type at least half as large as that used thereon for any
proprietary name or designation for such drug," on labels and other
printed material, § 502(e)(1)(B), 21 U.S.C. § 352(e)(1)(B). The
"established name" is one designated by the Secretary of Health,
Education, and Welfare pursuant to § 502(e)(2) of the Act, 21
U.S.C. § 352(e)(2); the "proprietary name" is usually a trade name
under which a particular drug is marketed. The underlying purpose
of the 1962 amendment was to bring to the attention of doctors and
patients the fact that many of the drugs sold under familiar trade
names are actually identical to drugs sold under their
"established" or less familiar trade names at significantly lower
prices. The Commissioner of Food and Drugs, exercising authority
delegated to him by the Secretary, 22 Fed.Reg. 1051, 25 Fed.Reg.
8625, published proposed regulations designed to implement the
statute, 28 Fed.Reg. 1448. After inviting and considering comments
submitted by interested parties, the Commissioner promulgated the
following regulation for the "efficient enforcement" of the Act, §
701(a), 21 U.S.C. § 371(a):
"If the label or labeling of a prescription drug bears a
proprietary name or designation for the drug or any ingredient
thereof, the established name, if such there be, corresponding to
such proprietary name or designation shall accompany each
appearance of such proprietary name or designation."
21 CFR § 1.104(g)(1). A similar rule was made applicable to
advertisements for prescription drugs, 21 CFR § 1.105(b)(1).
The present action was brought by a group of 37 individual drug
manufacturers and by the Pharmaceutical Manufacturers Association,
of which all the petitioner companies are members, and which
includes manufacturers of more than 90% of the Nation's supply of
prescription
Page 387 U. S. 139
drugs. They challenged the regulations on the ground that the
Commissioner exceeded his authority under the statute by
promulgating an order requiring labels, advertisements, and other
printed matter relating to prescription drugs to designate the
established name of the particular drug involved every time its
trade name is used anywhere in such material.
The District Court, on cross-motions for summary judgment,
granted the declaratory and injunctive relief sought, finding that
the statute did not sweep so broadly as to permit the
Commissioner's "every time" interpretation.
228 F.
Supp. 855. The Court of Appeals for the Third Circuit reversed
without reaching the merits of the case. 352 F.2d 286. It held
first that, under the statutory scheme provided by the Federal
Food, Drug, and Cosmetic Act, pre-enforcement [
Footnote 1] review of these regulations was
unauthorized, and therefore beyond the jurisdiction of the District
Court. Second, the Court of Appeals held that no "actual case or
controversy" existed, and, for that reason, that no relief under
the Administrative Procedure Act, 5 U.S.C. §§ 701-704 (1964 ed.,
Supp. II), or under the Declaratory Judgment Act, 28 U.S.C. § 2201,
was, in any event, available. Because of the general importance of
the question, and the apparent conflict with the decision of the
Court of Appeals for the Second Circuit in
Toilet Goods Assn.
v. Gardner, 360 F.2d 677, which we also review today,
post, p.
387 U. S. 158, we
granted certiorari. 383 U.S. 924.
I
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
Page 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.
Board of Governors v. Agnew, 329 U.
S. 441;
Heikkila v. Barber, 345 U.
S. 229;
Brownell v. Tom We Shung, 352 U.
S. 180;
Harmon v. Brucker, 355 U.
S. 579;
Leedom v. Kyne, 358 U.
S. 184;
Rusk v. Cort, 369 U.
S. 367. Early cases in which this type of judicial
review was entertained,
e.g., Shields v. Utah Idaho Central R.
Co., 305 U. S. 177;
Stark v. Wickard, 321 U. S. 288,
have been reinforced by the enactment of the Administrative
Procedure Act, which embodies the basic presumption of judicial
review to one "suffering legal wrong because of agency action, or
adversely affected or aggrieved by agency action within the meaning
of a relevant statute," 5 U.S.C. § 702, so long as no statute
precludes such relief or the action is not one committed by law to
agency discretion, 5 U.S.C. § 701(a). The Administrative Procedure
Act provides specifically not only for review of "[a]gency action
made reviewable by statute", but also for review of "final agency
action for which there is no other adequate remedy in a court," 5
U.S.C. § 704. The legislative material elucidating that seminal act
manifests a congressional intention that it cover a broad spectrum
of administrative actions, [
Footnote 2] and this Court has echoed that theme by noting
that the Administrative
Page 387 U. S. 141
Procedure Act's "generous review provisions" must be given a
"hospitable" interpretation.
Shaughnessy v. Pedreiro,
349 U. S. 48,
349 U. S. 51;
see United States v. Interstate Commerce Comm'n,
337 U. S. 426,
337 U. S.
433-435;
Brownell v. Tom We Shung, supra; Heikkila
v. Barber, supra. Again in
Rusk v. Cort, supra, at
369 U. S.
379-380, the Court held that only upon a showing of
"clear and convincing evidence" of a contrary legislative intent
should the courts restrict access to judicial review.
See
also Jaffe, Judicial Control of Administrative Action 336-359
(1965).
Given this standard, we are wholly unpersuaded that the
statutory scheme in the food and drug area excludes this type of
action. The Government relies on no explicit statutory authority
for its argument that pre-enforcement review is unavailable, but
insists instead that, because the statute includes a specific
procedure for such review of certain enumerated kinds of
regulations, [
Footnote 3] not
encompassing those of the kind involved here, other types were
necessarily meant to be excluded from any pre-enforcement review.
The issue, however, is not so readily resolved; we must go further
and inquire whether, in the context of the entire legislative
scheme the existence of that circumscribed remedy evinces a
congressional purpose to bar agency action not within its purview
from judicial review. As a leading authority in this field has
noted,
"The mere fact that some acts are made reviewable should not
suffice to support an implication of exclusion as to others. The
right to review is too important to be excluded on such slender and
indeterminate evidence of legislative intent."
Jaffe,
supra, at 357.
Page 387 U. S. 142
In this case, the Government has not demonstrated such a
purpose; indeed, a study of the legislative history shows rather
conclusively that the specific review provisions were designed to
give an additional remedy and not to cut down more traditional
channels of review. At the time the Food, Drug, and Cosmetic Act
was under consideration, in the late 1930's, the Administrative
Procedure Act had not yet been enacted, [
Footnote 4] the Declaratory Judgment Act was in its
infancy, [
Footnote 5] and the
scope of judicial review of administrative decisions under the
equity power was unclear. [
Footnote
6] It was these factors that led to the form the statute
ultimately took. There is no evidence at all that members of
Congress meant to preclude traditional avenues of judicial relief.
Indeed, throughout the consideration of the various bills submitted
to deal with this issue, it was recognized that
"There is always an appropriate remedy in equity in cases where
an administrative officer has exceeded his authority and there is
no adequate remedy of law, . . . [and that] protection is given by
the so-called Declaratory Judgments Act. . . ."
H.R.Rep. No. 2755, 74th Cong., 2d Sess., 8. It was specifically
brought to the attention of Congress that such methods had, in
fact, been used in the food and drug area, [
Footnote 7] and the Department of Justice, in opposing
the enactment of the special review procedures of § 701, submitted
a memorandum which was read on the floor of the House
Page 387 U. S. 143
stating:
"As a matter of fact, the entire subsection is really
unnecessary, because even without any express provision in the bill
for court review, any citizen aggrieved by any order of the
Secretary, who contends that the order is invalid, may test the
legality of the order by bringing an injunction suit against the
Secretary, or the head of the Bureau, under the general equity
powers of the court."
83 Cong.Rec. 7892 (1938).
The main issue in contention was whether these methods of review
were satisfactory.
Compare the majority and minority
reports on the review provisions, H.R.Rep. No. 2139, 75th Cong., 3d
Sess. (1938), both of which acknowledged that traditional judicial
remedies were available, but disagreed as to the need for
additional procedures. The provisions now embodied in a modified
form in § 701(f) were supported by those who feared the
life-and-death power given by the Act to the executive officials, a
fear voiced by many members of Congress. The supporters of the
special review section sought to include it in the Act primarily as
a method of reviewing agency factual determinations. For example,
it was argued that the level of tolerance for poisonous sprays on
apple crops, which the Secretary of Agriculture had recently set,
was a factual matter, not reviewable in equity in the absence of a
special statutory review procedure. [
Footnote 8] Some congressmen urged that challenge to this
type of determination should be in the form of a
de novo
hearing in a district court, but the Act as it was finally passed
compromised the matter by allowing an appeal on a record with a
"substantial evidence" test, affording a considerably more generous
judicial review than the "arbitrary and capricious" test available
in the traditional injunctive suit. [
Footnote 9]
Page 387 U. S. 144
A second reason for the special procedure was to provide broader
venue to litigants challenging such technical agency
determinations. At that time, a suit against the Secretary was
proper only in the District of Columbia, an advantage that the
Government sought to preserve. The House bill, however, originally
authorized review in any district court, but, in the face of a
Senate bill allowing review only in the District of Columbia, the
Conference Committee reached the compromise preserved in the
present statute authorizing review of such agency actions by the
courts of appeals. [
Footnote
10]
Against this background, we think it quite apparent that the
special review procedures provided in § 701(f), applying to
regulations embodying technical factual determinations, [
Footnote 11] were simply intended to
assure adequate judicial review of such agency decisions, and that
their enactment does not manifest a congressional purpose to
eliminate judicial review of other kinds of agency action.
This conclusion is strongly buttressed by the fact that the Act
itself, in § 701(f)(6), states, "The remedies provided for in this
subsection shall be in addition to and not in substitution for any
other remedies provided by law." This saving clause was passed over
by the Court of Appeals without discussion. In our view, however,
it bears heavily on the issue, for, if taken at face value, it
would foreclose the Government's main argument in this case. The
Government deals with the clause by arguing that it should be read
as applying only to review of
Page 387 U. S. 145
regulations under the sections specifically enumerated in
701(e). This is a conceivable reading, but it requires a
considerable straining both of language and of common
understanding. The saving clause itself contains no limitations,
and it requires an artificial statutory construction to read a
general grant of a right to judicial review begrudgingly, so as to
cut out agency actions that a literal reading would cover.
There is no support in the legislative background for such a
reading of the clause. It was included in the House bill, whose
report states that the provision
". . . saved as a method to review a regulation placed in effect
by the Secretary whatever rights exist to initiate a historical
proceeding in equity to enjoin the enforcement of the regulation,
and whatever rights exist to initiate a declaratory judgment
proceeding."
H.R.Rep. No. 2139, 75th Cong., 3d Sess, 11. The Senate conferees
accepted the provision. [
Footnote 12] The Government argues that the clause is
included as a part of § 701(f), and therefore should be read to
apply only to those sections to which the § 701(f) special review
procedure applies. But it is difficult to think of a more
appropriate place to put a general saving clause than where
Congress placed it -- at the conclusion of the section setting out
a special procedure for use in certain specified instances.
Furthermore, the Government's reading would result in an anomaly.
The §§ 701(e)-(f) procedure was included in the Act in order to
deal with the problem of technical determinations for which the
normal equity power was deemed insufficient.
See, supra,
pp. 142-144. There would seem little reason for Congress to have
enacted § 701(f), and at the same time to have included a clause
aimed only at preserving for such determinations the
Page 387 U. S. 146
other types of review whose supposed inadequacy was the very
reason for the special review provisions.
Under the Government's view, indeed, it is difficult to
ascertain when the saving clause would even come into play: when
the special provisions apply, presumably they must be used and a
court would not grant injunctive or declaratory judgment relief
unless the appropriate administrative procedure is exhausted.
[
Footnote 13] When the
special procedure does not apply, the Government deems the saving
clause likewise inapplicable. The Government, to be sure, does
present a rather far-fetched example of what it considers a
possible application of the relief saved by § 701(f)(6), but merely
to state it reveals the weakness of the Government's position.
[
Footnote 14] We prefer to
take the saving clause at its face value, and to read it in harmony
with the policy favoring judicial review expressed in the
Administrative Procedure Act and this Court's decisions.
The only other argument of the Government requiring attention on
the preclusive effect of the statute is that
Ewing v. Mytinger
& Casselberry, Inc., 339 U. S. 594,
counsels a restrictive view of judicial review in the food and drug
area. In that case, the Food and Drug Administrator found that
there was probable cause that a drug was "adulterated" because it
was misbranded in such a way as to be "fraudulent" or "misleading
to
Page 387 U. S. 147
the injury or damage of the purchaser or consumer." § 304(a), 21
U.S.C. § 334(a). Multiple seizures were ordered through libel
actions. The manufacturer of the drug brought an action to
challenge directly the Administrator's finding of probable cause.
This Court held that the owner could raise his constitutional,
statutory, and factual claims in the libel actions themselves, and
that the mere finding of probable cause by the Administrator could
not be challenged in a separate action. That decision was quite
clearly correct, but nothing in its reasoning or holding has any
bearing on this declaratory judgment action challenging a
promulgated regulation.
The Court in
Ewing first noted that the "administrative
finding of probable cause required by § 304(a) is merely the
statutory prerequisite to the bringing of the lawsuit," at which
the issues are aired. 339 U.S. at
339 U. S. 598.
Such a situation bears no analogy to the promulgation, after formal
procedures, of a rule that must be followed by an entire industry.
To equate a finding of probable cause for proceeding against a
particular drug manufacturer with the promulgation of a
self-operative industry-wide regulation, such as we have here,
would immunize nearly all agency rulemaking activities from the
coverage of the Administrative Procedure Act.
Second, the determination of probable cause in
Ewing
has "no effect in and of itself," 339 U.S. at
339 U. S. 598;
only some action consequent upon such a finding could give it legal
life. As the Court there noted, like a determination by a grand
jury that there is probable cause to proceed against an accused, it
is a finding which only has vitality once a proceeding is
commenced, at which time appropriate challenges can be made. The
Court also noted that the unique type of relief sought by the drug
manufacturer was inconsistent with the policy of the Act favoring
speedy action against goods in circulation that are believed on
probable cause to be adulterated.
Page 387 U. S. 148
Also, such relief was not specifically granted by the Act, which
did provide another type of relief in the form of a consolidation
of multiple libel actions in a convenient venue. 339 U.S. at
339 U. S.
602.
The drug manufacturer in
Ewing was quite obviously
seeking an unheard-of form of relief which, if allowed, would have
permitted interference in the early stages of an administrative
determination as to specific facts, and would have prevented the
regular operation of the seizure procedures established by the Act.
That the Court refused to permit such an action is hardly authority
for cutting off the well established jurisdiction of the federal
courts to hear, in appropriate cases, suits under the Declaratory
Judgment Act and the Administrative Procedure Act challenging final
agency action of the kind present here.
We conclude that nothing in the Food, Drug, and Cosmetic Act
itself precludes this action.
II
A further inquiry must, however, be made. 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 [
Footnote 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
Page 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. [
Footnote 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. Thus, in
Columbia
Broadcasting System
Page 387 U. S. 150
v. United States, 316 U. S. 407, a
suit under the Urgent Deficiencies Act, 38 Stat. 219, this Court
held reviewable a regulation of the Federal Communications
Commission setting forth certain proscribed contractual
arrangements between chain broadcasters and local stations. The FCC
did not have direct authority to regulate these contracts, and its
rule asserted only that it would not license stations which
maintained such contracts with the networks. Although no license
had, in fact, been denied or revoked, and the FCC regulation could
properly be characterized as a statement only of its intentions,
the Court held that
"Such regulations have the force of law before their sanctions
are invoked as well as after. When, as here, they are promulgated
by order of the Commission and the expected conformity to them
causes injury cognizable by a court of equity, they are
appropriately the subject of attack. . . ."
316 U.S. at
316 U. S.
418-419.
Two more recent cases have taken a similarly flexible view of
finality. In
Frozen Food Express v. United States,
351 U. S. 40, at
issue was an Interstate Commerce Commission order specifying
commodities that were deemed to fall within the statutory class of
"agricultural commodities." Vehicles carrying such commodities were
exempt from ICC supervision. An action was brought by a carrier
that claimed to be transporting exempt commodities, but which the
ICC order had not included in its terms. Although the dissenting
opinion noted that this ICC order had no authority except to give
notice of how the Commission interpreted the Act, and would have
effect only if and when a particular action was brought against a
particular carrier, and argued that "judicial intervention [should]
be withheld until administrative action has reached its complete
development," 351 U.S. at
351 U. S. 45,
the Court held the order reviewable.
Page 387 U. S. 151
Again, in
United States v. Storer Broadcasting Co.,
351 U. S. 192, the
Court held to be a final agency action within the meaning of the
Administrative Procedure Act an FCC regulation announcing a
Commission policy that it would not issue a television license to
an applicant already owning five such licenses, even though no
specific application was before the Commission. The Court stated:
"The process of rulemaking was complete. It was final agency action
. . . by which Storer claimed to be
aggrieved.'" 351 U.S. at
351 U. S.
198.
We find decision in the present case following
a
fortiori from these precedents. The regulation challenged
here, promulgated in a formal manner after announcement in the
Federal Register and consideration of comments by interested
parties [
Footnote 17] is
quite clearly definitive. There is no hint that this regulation is
informal,
see Helco Products Co. v. McNutt, 78
U.S.App.D.C. 71, 137 F.2d 681, or only the ruling of a subordinate
official,
see Swift & Co. v. Wickham, 230 F.
Supp. 398, 409,
aff'd, 364 F.2d 241, or tentative. It
was made effective upon publication, and the Assistant General
Counsel for Food and Drugs stated in the District Court that
compliance was expected.
The Government argues, however, that the present case can be
distinguished from cases like
Frozen Food Express on the
ground that, in those instances, the agency involved could
implement its policy directly, while here, the Attorney General
must authorize criminal and seizure actions for violations of the
statute. In the context of this case, we do not find this argument
persuasive. These regulations are not meant to advise the Attorney
General, but purport to be directly authorized by the statute.
Thus, if within the Commissioner's authority,
Page 387 U. S. 152
they have the status of law and violations of them carry heavy
criminal and civil sanctions. Also, there is no representation that
the Attorney General and the Commissioner disagree in this area;
the Justice Department is defending this very suit. It would be
adherence to a mere technicality to give any credence to this
contention. Moreover, the agency does have direct authority to
enforce this regulation in the context of passing upon applications
for clearance of new drugs, § 505, 21 U.S.C. § 355, or
certification of certain antibiotics, § 507, 21 U.S.C. § 357.
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. [
Footnote 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."
228 F.
Supp. 855, 861. The regulations are clear-cut, and were made
effective immediately upon publication; as noted earlier the
agency's counsel represented to the District Court that immediate
compliance with their terms was expected. If petitioners wish to
comply they must change all their labels, advertisements, and
promotional materials; they must destroy stocks of printed matter,
and they must invest heavily in new printing type and new
supplies.
Page 387 U. S. 153
The alternative to compliance -- continued use of material which
they believe in good faith meets the statutory requirements, but
which clearly does not meet the regulation of the Commissioner --
may be even more costly. That course would risk serious criminal
and civil penalties for the unlawful distribution of "misbranded"
drugs. [
Footnote 19]
It is relevant at this juncture to recognize that petitioners
deal in a sensitive industry, in which public confidence in their
drug products is especially important. To require them to challenge
these regulations only as a defense to an action brought by the
Government might harm them severely and unnecessarily. Where the
legal issue presented is fit for judicial resolution, and where a
regulation requires an immediate and significant change in the
plaintiffs' conduct of their affairs with serious penalties
attached to noncompliance, access to the courts under the
Administrative Procedure Act and the Declaratory Judgment Act must
be permitted, absent a statutory bar or some other unusual
circumstance, neither of which appears here.
The Government does not dispute the very real dilemma in which
petitioners are placed by the regulation, but contends that "mere
financial expense" is not a justification for pre-enforcement
judicial review. It is, of course, true that cases in this Court
dealing with the standing of particular parties to bring an action
have held that a possible financial loss is not, by itself, a
sufficient interest to sustain a judicial challenge to governmental
action.
Frothingham v. Mellon, 262 U.
S. 447;
Perkins v.
Lukens
Page 387 U. S. 154
Steel Co., 310 U. S. 113. But
there is no question in the present case that petitioners have
sufficient standing as plaintiffs: the regulation is directed at
them in particular; it requires them to make significant changes in
their everyday business practices; if they fail to observe the
Commissioner's rule, they are quite clearly exposed to the
imposition of strong sanctions.
Compare Columbia Broadcasting
System v. United States, 316 U. S. 407; 3
Davis, Administrative Law Treatise, c. 21 (1958). This case is,
therefore, remote from the
Mellon and
Perkins
cases.
The Government further contends that the threat of criminal
sanctions for noncompliance with a judicially untested regulation
is unrealistic; the Solicitor General has represented that, if
court enforcement becomes necessary, "the Department of Justice
will proceed only civilly for an injunction . . . or by
condemnation." We cannot accept this argument as a sufficient
answer to petitioners' petition. This action at its inception was
properly brought and this subsequent representation of the
Department of Justice should not suffice to defeat it.
Finally, the Government urges that to permit resort to the
courts in this type of case may delay or impede effective
enforcement of the Act. We fully recognize the important public
interest served by assuring prompt and unimpeded administration of
the Pure Food, Drug, and Cosmetic Act, but we do not find the
Government's argument convincing. First, in this particular case, a
pre-enforcement challenge by nearly all prescription drug
manufacturers is calculated to speed enforcement. If the Government
prevails, a large part of the industry is bound by the decree; if
the Government loses, it can more quickly revise its
regulation.
The Government contends, however, that, if the Court allows this
consolidated suit, then nothing will prevent a multiplicity of
suits in various jurisdictions challenging other regulations. The
short answer to this contention
Page 387 U. S. 155
is that the courts are well equipped to deal with such
eventualities. The venue transfer provision, 28 U.S.C. § 1404(a),
may be invoked by the Government to consolidate separate actions.
Or actions in all but one jurisdiction might be stayed pending the
conclusion of one proceeding.
See American Life Ins. Co. v.
Stewart, 300 U. S. 203,
300 U. S.
215-216. A court may even, in its discretion, dismiss a
declaratory judgment or injunctive suit if the same issue is
pending in litigation elsewhere.
Maryland Cas. Co. v. Consumers
Finance Service, 101 F.2d 514;
Carbide & Carbon C.
Corp. v. United States I. Chemicals, 140 F.2d 47; Note,
Availability of a Declaratory Judgment When Another Suit Is
Pending, 51 Yale L.J. 511 (1942). In at least one suit for a
declaratory judgment, relief was denied with the suggestion that
the plaintiff intervene in a pending action elsewhere.
Automotive Equip., Inc. v. Trico Prods.
Corp., 11 F. Supp.
292;
see Allstate Ins. Co. v. Thompson, 121 F.
Supp. 696.
Further, the declaratory judgment and injunctive remedies are
equitable in nature, and other equitable defenses may be
interposed. If a multiplicity of suits are undertaken in order to
harass the Government or to delay enforcement, relief can be denied
on this ground alone.
Truly v.
Wanzer, 5 How. 141,
46 U. S. 142;
cf. Brillhart v. Excess Ins. Co., 316 U.
S. 491,
316 U. S. 495.
The defense of laches could be asserted if the Government is
prejudiced by a delay,
Southern Pac. Co. v. Bogert,
250 U. S. 483,
250 U. S.
488-490; 2 Pomeroy's Equity Jurisprudence §§ 419c-d (5th
ed. Symons, 1941). And courts may even refuse declaratory relief
for the nonjoinder of interested parties who are not, technically
speaking, indispensable.
Cf. Samuel Goldwyn, Inc. v. United
Artists Corp., 113 F.2d 703; 6A Moore, Federal Practice �
57.25 (2d ed.1966).
In addition to all these safeguards against what the Government
fears, it is important to note that the institution of this type of
action does not, by itself, stay the effectiveness of the
challenged regulation. There is
Page 387 U. S. 156
nothing in the record to indicate that petitioners have sought
to stay enforcement of the "every time" regulation pending judicial
review.
See 5 U.S.C. § 705. If the agency believes that a
suit of this type will significantly impede enforcement or will
harm the public interest, it need not postpone enforcement of the
regulation, and may oppose any motion for a judicial stay on the
part of those challenging the regulation.
Ibid. It is
scarcely to be doubted that a court would refuse to postpone the
effective date of an agency action if the Government could show, as
it made no effort to do here, that delay would be detrimental to
the public health or safety.
See Associated Securities Corp. v.
SEC, 283 F.2d 773, 775, where a stay was denied because "the
petitioners . . . [had] not sustained the burden of establishing
that the requested stays will not be harmful to the public interest
. . . ";
see Eastern Air Lines v. CAB, 261 F.2d 830;
cf. Scripps-Howard Radio v. FCC, 316 U. S.
4,
316 U. S. 10-11;
5 U.S.C. § 705.
Lastly, although the Government presses us to reach the merits
of the challenge to the regulation in the event we find the
District Court properly entertained this action, we believe the
better practice is to remand the case to the Court of Appeals for
the Third Circuit to review the District Court's decision that the
regulation was beyond the power of the Commissioner. [
Footnote 20]
Reversed and remanded.
MR. JUSTICE BRENNAN took no part in the consideration or
decision of this case.
[For dissenting opinions of MR. JUSTICE FORTAS and MR. JUSTICE
CLARK,
see post pp.
387 U. S. 174
and
387 U. S. 201,
respectively.]
[
Footnote 1]
That is, a suit brought by one before any attempted enforcement
of the statute or regulation against him.
[
Footnote 2]
See H.R.Rep. No.1980, 79th Cong., 2d Sess., 41
(1946):
"To preclude judicial review under this bill a statute, if not
specific in withholding such review, must upon its face give clear
and convincing evidence of an intent to withhold it. The mere
failure to provide specially by statute for judicial review is
certainly no evidence of intent to withhold review."
See also S.Rep. No. 752, 79th Cong., 1st Sess., 26
(1945).
[
Footnote 3]
Embodied in §§ 701(e), (f), 21 U.S.C. §§ 371(e), (f), and
discussed hereafter. Section 701(e) provides a procedure for the
issuance of regulations under certain specifically enumerated
statutory sections. Section 701(f) establishes a procedure for
direct review by a court of appeals of a regulation promulgated
under § 701(e).
[
Footnote 4]
The Administrative Procedure Act was enacted in 1946, 60 Stat.
237.
[
Footnote 5]
The Declaratory Judgment Act was enacted in 1934, 48 Stat.
955.
[
Footnote 6]
See, e.g., the discussion of judicial review under the
equity power in the House of Representatives during the debate on
these provisions. 83 Cong.Rec. 7891-7896 (1938).
[
Footnote 7]
See, e.g., 83 Cong.Rec. 7783 (remarks of Representative
Leavy) (1938); Statement of Professor David F. Cavers before a
Subcommittee of the Senate Committee on Commerce on S.1944, 73d
Cong., 2d Sess. (1933), reprinted in Dunn, Federal Food, Drug, and
Cosmetic Act, A Statement of Its Legislative Record 1110
(1938).
[
Footnote 8]
See, e.g., 83 Cong.Rec. 7772-7773, 7781-7784, 7893-7899
(1938).
[
Footnote 9]
See, e.g., the discussion of the conference report, 83
Cong.Rec. 9096-9098 (1938).
[
Footnote 10]
See, e.g., 83 Cong.Rec. 7772, 7892, 9092-9093
(1938).
[
Footnote 11]
See Toilet Goods Assn. v. Gardner, 360 F.2d 677, 683,
where the court noted that
"The agency determinations specifically reviewable under §
701(e) relate to such technical subjects as chemical properties of
particular products and the formulation and application of safety
standards for protecting public health; Congress naturally did not
wish courts to consider such matters without the benefit of the
agency's views after an evidentiary hearing before it."
[
Footnote 12]
H.R.Conf.Rep. No. 2716, 75th Cong., 3d Sess., 25 (1938); 83
Cong.Rec. 8731-8738 (1938) (Senate agreement to the conference
report).
[
Footnote 13]
See Notes of the Advisory Committee on Federal Rule of
Civil Procedure 57, reprinted in 28 U.S.C.App. at 6136: "A
declaration may not be rendered if a special statutory proceeding
has been provided for the adjudication of some special type of
case. . . ."
See also 6A Moore, Federal Practice §
57.08[3] (2d ed.1966).
[
Footnote 14]
The Government apparently views the clause as applying only when
regulations falling within the special review procedure are
promulgated without affording the required public notice and
opportunity to file objections and to request a public hearing. In
such a case alone, the Government asserts, "an equity proceeding or
a declaratory judgment action . . . might be entertained on the
ground that the statutory procedures had not been followed." Brief,
p. 28.
[
Footnote 15]
See 3 Davis, Administrative Law Treatise, c. 21 (1958);
Jaffe Judicial Control of Administrative Action, c. 10 (1965).
[
Footnote 16]
While the "every time" issue has been framed by the parties in
terms of statutory
compulsion, we think that its
essentially legal character would not be different had it been
framed in terms of statutory
authorization for the
requirement.
[
Footnote 17]
Compare similar procedures followed in
Frozen Food
Express, supra, at
351 U. S. 41-42,
and
Storer, supra, at 193-194. The procedure conformed
with that prescribed in § 4 of the Administrative Procedure Act, 5
U.S.C. § 1003.
[
Footnote 18]
See S.Rep. No. 1005, 73d Cong., 2d Sess., 2-3 (1934);
Borchard, Challenging "Penal" Statutes by Declaratory Action, 52
Yale L.J. 445, 454 (1943).
[
Footnote 19]
Section 502(e)(1)(B) declares a drug not complying with this
labeling requirement to be "misbranded." Section 301, 21 U.S.C. §
331, designates as "prohibited acts" the misbranding of drugs in
interstate commerce. Such prohibited acts are subject to
injunction, § 302, 21 U.S.C. § 332, criminal penalties, § 303, 21
U.S.C. § 333, and seizure, § 304(a), 21 U.S.C. § 334(a).
[
Footnote 20]
A totally separate issue raised in the petition for certiorari
and argued by the parties in their briefs concerns the dismissal of
the complaint as to certain of the plaintiffs on the ground that
venue was improper as to them. All the petitioners asserted that
venue was proper in Delaware not only because some of them are
incorporated there, but also under 28 U.S.C. § 1381(e)(4), allowing
an action against a government official in any judicial district in
which "the plaintiff resides. . . ." It is contended that §
1391(e)(4) must be read to incorporate the definition of
"residence" set out in 28 U.S.C. § 1391(c):
"A corporation may be sued in any judicial district in which it
is incorporated or licensed to do business or is doing business,
and such judicial district shall be regarded as the residence of
such corporation for venue purposes."
The issue of construction is whether § 1391(c) should be read as
defining corporate venue only when the corporation is a defendant,
or whether it should either (1) be adopted for corporate residence
in all cases when a corporation is a plaintiff, or (2) at least as
the definition of "resides" as used in § 1391(e)(4).
This question is a difficult one, with far-reaching effects, and
we think it is appropriate to dismiss our writ of certiorari as to
this question for the following two reasons. First, the Court of
Appeals, in affirming the District Court on this issue, did not
explicitly endorse the lower court's ruling, but held only: "We
find no prejudicial error in the dismissal of the complaint as to
these plaintiffs. . . ." 352 F.2d 524, 525. Review of an issue of
this importance is best left to a case where it has been fully
dealt with by a court of appeals. Second, one of the plaintiffs
whose complaint was not dismissed is the Pharmaceutical
Manufacturers Association, of which all the corporate petitioners
are members, and we think it should be considered that they are
adequately protected in this suit by its participation, as well as
by the participation of the remaining drug companies whose
interests are identical to those of the petitioners whose
complaints were dismissed.
Cf. Mishkin v. New York,
383 U. S. 502,
383 U. S.
512-514. Moreover, in the further course of this
litigation, it will be open to the dismissed plaintiffs to seek
amicus curiae status.