United States of America v.  Gary Duane Ellis

PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
 UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 01-4273 
GARY DUANE ELLIS,
Defendant-Appellant. 
Appeal from the United States District Court
for the Western District of Virginia, at Roanoke.
James C. Turk, Senior District Judge.
(CR-00-14)
Argued: October 31, 2002
Decided: April 21, 2003
Before NIEMEYER, WILLIAMS, and MICHAEL, Circuit Judges.
Affirmed by published opinion. Judge Niemeyer wrote the opinion,
in which Judge Williams joined. Judge Michael wrote a dissenting
opinion.
COUNSEL
ARGUED: Melissa Windham Friedman, Roanoke, Virginia, for
Appellant. Barbara Tolliver Wells, UNITED STATES DEPART-
MENT OF JUSTICE, Washington, D.C., for Appellee. ON BRIEF:
Anthony F. Anderson, Roanoke, Virginia, for Appellant. John Brown-
lee, United States Attorney, Anthony P. Giorno, Assistant United
States Attorney, Roanoke, Virginia, for Appellee.

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OPINION
NIEMEYER, Circuit Judge:
Gary Duane Ellis was convicted, on three counts, of (1) conspiring
to manufacture and sell a misbranded drug, gamma hydroxybutyrate
("GHB"), in violation of 18 U.S.C. § 371, (2) misbranding GHB, in
violation of 21 U.S.C. §§ 331(a), (k) and 332(a)(2); and (3) failing to
register, with an intent to defraud or mislead, a kitchen laboratory
operated for the purpose of manufacturing GHB, in violation of 21
U.S.C. §§ 331(p) and 333(a)(2). The district court sentenced Ellis to
imprisonment for one year and one day.
On appeal, Ellis contends that there was insufficient evidence from
which a jury could conclude that, on Count III, his failure to register
his kitchen laboratory was with an intent to defraud or mislead, the
element that distinguishes felonious failure to register from the lesser
included misdemeanor offense. He also contends that the district
court’s jury instruction on Count III giving the definition of "intent
to defraud and mislead" created a conclusive presumption that uncon-
stitutionally shifted the burden of persuasion to Ellis.
For the reasons that follow, we affirm.
I
In August 1999, the Food and Drug Administration ("FDA") com-
menced an investigation of individuals suspected of manufacturing
and distributing GHB in the Roanoke, Virginia area.
GHB, which was banned by the FDA in 1990, is most commonly
used as a party drug for its intoxicating or euphoric effects, although
some use it believing it to be effective in stimulating muscle growth,
promoting sleep, or enhancing libido. It is easy to make, requiring
simply the mixing and heating of gamma butyrolactone ("GBL"),
which is a commercial solvent, and sodium hydroxide, which is a
caustic soda known as the main ingredient in some liquid drain open-
ers. GHB is usually ingested in liquid form in doses that would fill
a soda bottle cap. While it causes a feeling of euphoria, it can also
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result in dizziness, vomiting, urinary incontinence, seizures, coma,
and even death. As a "drug" within the meaning of the Federal Food,
Drug, and Cosmetic Act, the manufacture and distribution of GHB is
subject to FDA regulation.
During its investigation, the FDA discovered that Ellis was pur-
chasing large quantities of GBL and sodium hydroxide from chemical
manufacturers in his own name and through the names of others.
David Reedy, an individual cooperating with the FDA in its investiga-
tion, made controlled purchases from Ellis in October 1999, leading
to the issuance of a search warrant for the search of Ellis’ home. Dur-
ing that search, FDA agents discovered a plastic container containing
sodium hydroxide under Ellis’ kitchen table; pots and pans and a
Pyrex mixing bowl that Ellis admitted were used to manufacture and
process GHB; three five-gallon containers of GBL and three one-
gallon milk jugs of GHB in Ellis’ bedroom; and additional containers
of GBL in Ellis’ living room closet and in the bedroom closet of Ellis’
housemate. The agents also discovered printed material and Internet
documents in the living room and in his housemate’s bedroom, some
of which detailed GHB’s legal status. One article indicated that GHB
was not "scheduled" as a controlled substance by the federal Drug
Enforcement Agency or by Virginia but that its sale was subject to
"current FDA regulations and policy." Additional articles related to
the health effects of GHB and its legality.
During the course of the search, Ellis cooperated, admitting that he
had been making GHB in a pot on his stove since 1997, using a recipe
that he obtained over the Internet. He stated that he had purchased
GBL from Chemsolv, Inc., a chemical manufacturing company, and
from friends who procured it for him at his request. Ellis stated that
he used GHB personally, distributed it to friends, and sold it to out-
of-state persons who he believed sold it to others. The FDA estimated
that the total quantity of GBL involved in this case was enough to
manufacture approximately 200,000 individual doses of GHB.
A grand jury indicted Ellis in three counts. Count I charged him
with conspiracy to manufacture, hold for sale, dispense, and deliver
GHB that was adulterated or misbranded, with the intent to defraud
of mislead, in violation of 18 U.S.C. § 371 and 21 U.S.C. §§ 331(k)
and 333(a)(2). Count II charged Ellis with introducing GHB that was
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misbranded into interstate commerce, with the intent to defraud or
mislead, in violation of 21 U.S.C. §§ 331(a), (k) and 333(a)(2).
Finally, Count III charged Ellis with failing to register, with the intent
to defraud or mislead, a laboratory in which he manufactured GHB,
in violation of 21 U.S.C. §§ 331(p) and 333(a)(2). Each of these
counts contained a lesser included misdemeanor offense differentiated
by the absence of the element that the offense be committed with the
intent to defraud or mislead.
The jury convicted Ellis of misdemeanors on Counts I and II and
of a felony on Count III, concluding as to that count that Ellis failed
to register his kitchen drug laboratory with the intent to defraud or
mislead. The district court sentenced Ellis to a six-month term of
imprisonment on each of Counts I and II and to a one-year and one-
day term of imprisonment on Count III, all sentences to run concur-
rently.
On appeal, Ellis challenges only his conviction on Count III, alleg-
ing (1) that the evidence was insufficient to prove that he acted with
the intent to defraud or mislead and (2) that the district court’s jury
instruction defining intent to defraud or mislead created a conclusive
presumption that unconstitutionally shifted the burden of persuasion
to him.
II
In challenging the sufficiency of the evidence, Ellis measures the
government’s evidence against a narrow statutory interpretation of 21
U.S.C. § 333(a)(2) that forms the core of his argument. He concedes
that he failed to register an establishment that manufactured GHB, but
he argues that "there was no evidence that in failing to register, [he]
acted with the intent to defraud or mislead . . . . Clearly, any intent
to defraud or mislead must have been related to the underlying act of
failing to register with the FDA." (Emphasis added). Explaining his
statutory argument, Ellis states:
The most that the United States might argue is that the act
of failing to register itself is sufficient proof of intent to
defraud or mislead. However, that argument must be
rejected. The statute prohibits as a misdemeanor failure to
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register with the FDA. In order to elevate the crime to a fel-
ony there must be evidence of an intent to defraud or mis-
lead in addition to the evidence that proves the
misdemeanor. Otherwise the "intent to defraud or mislead"
language would be meaningless.
The evidence that the government offered, Ellis argues, proves at
most that he intended to mislead his chemical supplier, Chemsolv,
Inc., but that conduct, he asserts, "has no nexus to the defendant’s
failure to register with the FDA."
Because the violation of 21 U.S.C. § 333(a)(2) becomes a felony
only when the conduct is undertaken "with the intent to defraud or
mislead," we begin by focusing on the meaning of this statutory lan-
guage.
Under 21 U.S.C. § 360(b) and (c), any person operating an estab-
lishment that engages in the "manufacture, preparation, propagation,
compounding, or processing of a drug" is required to register his
name and place of business with the Secretary of Health and Human
Services. This registration is the mechanism by which the Secretary
is advised of premises subject to the Secretary’s regulation and that
a Department official must inspect periodically. See 21 U.S.C.
§ 360(h). The registration also serves to provide the Secretary with a
list of drugs at the registered location, the authority for their market-
ing, and a copy of their labeling. See id. § 360(j). The registration is
available for inspection by "any person so requesting." Id. § 360(f).
Thus, registration required by § 360(b) and (c) serves a disclosure role
necessary for the effective regulation of drugs — a regulation that is
undertaken through the FDA to protect the public’s health and safety
against the distribution of impure, adulterated, illicit, and noxious arti-
cles. See United States v. Dotterweich, 320 U.S. 277, 280 (1943).
Because the § 360 registration requirement is fundamental to the
FDA’s ability to regulate drugs, the Federal Food, Drug, and Cos-
metic Act provides a range of remedies for failing to register, includ-
ing criminal penalties. The failure to register, regardless of the
person’s knowledge and intent, is a misdemeanor punishable by not
more than one year in prison and/or a fine of not more than $1,000.
21 U.S.C. § 333(a)(1). But if the failure to register is committed "with
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the intent to defraud or mislead," the violation becomes a felony pun-
ishable by not more than three years in prison and/or a fine of not
more than $10,000. Id. § 333(a)(2).
In light of the function of the registration requirement in the FDA’s
regulatory oversight scheme, we conclude that "intent to defraud or
mislead" under § 333(a)(2) is shown when the evidence demonstrates
that the defendant has deliberately frustrated the purpose for which
registration is required under § 360(b) and (c), i.e., to provide the
required information to the FDA and to facilitate public knowledge
of the defendant’s operations. The inquiry, therefore, is whether the
defendant designed his conduct to avoid the regulatory scrutiny of the
FDA. Thus, while the inadvertent failure of an ordinarily dutiful and
law-abiding operator to register its drug-manufacturing establishment
gives rise only to a misdemeanor violation, a defendant’s affirmative
efforts to conceal his drug-making establishment from the FDA can
serve as evidence of an intent to defraud or mislead, as provided in
§ 333(a)(2). See United States v. Arlen, 947 F.2d 139 (5th Cir. 1991);
United States v. Bradshaw, 840 F.2d 871 (11th Cir. 1988).
With this understanding of the statute, we turn to whether the evi-
dence that the government offered against Ellis in this case was suffi-
cient to permit a reasonable jury to find beyond a reasonable doubt
that Ellis failed to register with the FDA "with the intent to defraud
or mislead," in violation of 21 U.S.C. § 333(a)(2).
The government introduced extensive evidence demonstrating that
Ellis actively concealed his operations from the regulatory scrutiny of
the FDA. Evidence was presented to show that Ellis was aware that
his manufacturing of GHB violated FDA regulations, and this evi-
dence included articles and Internet documents in Ellis’ home that
detailed the legal status of GHB and indicated that it was subject to
"current FDA regulations and policy." Ellis also knew of the dangers
of GHB, as was evident both from the written materials discovered
in his home and also from the testimony of a witness who stated that
Ellis had discussed with him a CNN program on the dangers of GHB
and had personally experienced and observed its effects. This witness
also testified that Ellis once stated he was aware that, although GHB
was once available over the counter, the FDA had "pulled it off the
shelves" in 1990. Ellis’ concern for federal regulation was manifested
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by his extensive efforts to keep secret his purchases of chemicals, his
manufacturing process, and his distribution of GHB. Some of Ellis’
acquaintances testified at trial that Ellis had asked them to purchase
GBL and sodium hydroxide for him because Chemsolv had begun to
ask Ellis questions about his purchases and Ellis was afraid to make
further purchases from Chemsolv himself. There was testimony that
"as a cover" Ellis purchased GBL from Chemsolv in the name of his
father’s car lot and that, if he were to be asked questions about his
purchases, he would lie, saying that he was using the GBL as a floor
cleaner at the car lot. There was evidence that after a report of GHB
usage at a local high school, Ellis accused his acquaintance of distrib-
uting GHB carelessly; he "worried [that] someone was going to blow
it for him" and "cause . . . suspicion on him for manufacturing GHB."
Ellis was also concerned that another acquaintance would "ruin it for
him" — "it" meaning the "making . . . and selling" of GHB — by
"run[ning] his mouth." There was testimony that if a person came to
Ellis’ apartment door while he was making GHB, Ellis would "get rid
of" the visitor because he did not want anyone to know what he was
doing. Finally, testimony from FDA agents demonstrated that the
containers of GHB in Ellis’ bedroom were concealed with a towel and
that other containers of GHB were stored out of sight in his closets.
From this evidence, a rational jury could have concluded beyond
a reasonable doubt that Ellis knew that the manufacture and distribu-
tion of GHB was regulated by the FDA; that GHB was potentially
harmful to the public; and that Ellis deliberately withheld disclosure
and concealed his operations from government regulation in order to
frustrate that regulation and deny the government of the knowledge
that registration would otherwise provide. If believed, this evidence
would readily establish that Ellis failed to register and subject his
operation to FDA regulation with the intent to defraud or mislead the
FDA and ultimately the public. See Arlen, 947 F.2d 139; Bradshaw,
840 F.2d 871. But see United States v. Geborde, 278 F.3d 926 (9th
Cir. 2000). Indeed, this evidence leaves little room for Ellis to argue
that his failure to register was innocent or even negligent.
Accordingly, we reject Ellis’ argument that the evidence was insuf-
ficient to support his conviction and affirm the district court’s denial
of Ellis’ motion for judgment of acquittal.
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III
Ellis also contends that the district court erred in instructing the
jury relating to the definition of "intent to defraud or mislead." He
argues that the district court’s instruction in this case could have been
interpreted by the jury as setting forth a "conclusive presumption" that
shifted the burden of persuasion to the defendant on the element of
"intent to defraud or mislead," in violation of Sandstrom v. Montana,
442 U.S. 510 (1979). In Sandstrom, the Supreme Court reviewed a
jury instruction on deliberate homicide, which stated that "the law
presumes that a person intends the ordinary consequences of his vol-
untary acts" and which was given without any instruction that the pre-
sumption could be rebutted by the defendant’s simple presentation of
some evidence. Id. at 517. The Court held that such an instruction
violated the constitutional requirement set forth in In re Winship, 397
U.S. 358 (1970), that the government carry the burden of proving
every element of a criminal offense beyond a reasonable doubt. Sand-
strom, 442 U.S. at 520-24.
Ellis argues that in this case the district court violated Sandstrom
in its jury instruction on the intent requirement by stating that intent
"can be established by proof beyond a reasonable doubt that the
defendant took affirmative steps in an effort to conceal his activity
from government agencies, such as the [FDA]." The full instruction,
as relevant, reads as follows:
All of the counts in the indictment allege that the defen-
dants violated or agreed to violate provisions of the Federal
Food, Drug and Cosmetic Act, with the intent to defraud or
mislead. To act with intent to defraud means to act with a
specific intent to deceive or cheat, ordinarily, for the pur-
pose of either causing some financial loss to another or
bringing about some financial gain to one’s self. It is not
necessary, however, to prove that anyone was, in fact,
defrauded, as long as it is established beyond a reasonable
doubt that the defendant acted with the intent to defraud or
mislead.
You are further charged that to act with intent to mislead
means to act with the specific intent to create a false impres-
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sion by misstating, omitting or concealing facts. It is not
necessary, however, to prove that anyone was, in fact, mis-
led, as long as it is established beyond a reasonable doubt
that the defendant acted with the intent to mislead.
A defendant acts with the intent to defraud or mislead
under the Federal Food, Drug and Cosmetic Act if the
defendant acts with the intent to defraud or mislead either
the government or the consumers of the defendant’s prod-
uct. To act with the intent to defraud or mislead the govern-
ment means to act with the specific intent to interfere with
or obstruct a lawful government function by deceit, craft or
trickery, or at least by means that are dishonest. Intent to
defraud or mislead the government can be established by
proof beyond a reasonable doubt that the defendant took
affirmative steps in an effort to conceal his activities from
government agencies, such as the Food and Drug Adminis-
tration, charged with regulating those activities.
* * *
You are further charged that the defendants could be in
violation of the law, even if they did not act with the intent
to defraud or mislead. Therefore, if you find that the govern-
ment has proven each of the elements of the offense charged
but did not prove beyond a reasonable doubt that the defen-
dants acted with the intent to defraud or mislead, you should
indicate that you are finding that they have violated the law
without the intent to defraud or mislead.
(Emphasis added). Ellis focuses on the highlighted portion of the
instruction to argue that the jury could have understood the instruction
to require a finding of intent to defraud if it found evidence of the
concealment described in the instruction. This argument, however,
simply fails to accommodate the language of the instruction.
The instructions set forth no conclusive presumption of any kind
that would implicate the constitutional error found in Sandstrom. The
court never told the jury to apply a conclusive presumption to find the
intent element of the offense based solely on a factual finding of con-
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cealment. The instruction merely informed the jury of the types of
conduct that it might find to fulfill the requirement of proving intent.
In describing the evidence that "can" support a finding of intent to
defraud or mislead, the court did not demand that the intent element
be found satisfied as a consequence of concealment evidence. Rather,
it instructed the jury permissively, stating that concealment, the most
common example of intent to defraud or mislead, "can" show an
intent to defraud or mislead. Moreover, the court repeatedly made
clear that the government always bore the burden of proving all facts
and elements of the crime beyond a reasonable doubt, including intent
to defraud or mislead. Accordingly, we find Ellis’ argument without
merit.
For the foregoing reasons, Ellis’ conviction on Count III of the
indictment finding him in violation of 21 U.S.C. § 333(a)(2) with
intent to defraud or mislead is
AFFIRMED.
MICHAEL, Circuit Judge, dissenting:
Although GHB is now a controlled substance under the federal
drug trafficking statute (the Drug Abuse Prevention and Control Act),
21 U.S.C. §§ 801-971, it was not at the time Gary D. Ellis was caught
making the stuff in 1999. Thus, to prosecute Ellis, the government
had to charge him with several violations of the Food, Drug, and Cos-
metic Act (FDCA), 21 U.S.C. §§ 301-399, a consumer protection act
designed to prevent harmful foods, drugs, and cosmetics from enter-
ing the market. As one court has said, "[t]he problem [in a case like
Ellis’s] is that the FDCA was not designed to deal with the [manufac-
ture and] distribution of homemade substances." United States v.
Geborde, 278 F.3d 926, 928 (9th Cir. 2002). Our job today is to
decide to what extent "the square pegs of [Ellis’s] conduct can be
pounded into the round holes of the FDCA." Id. I respectfully dissent
because one aspect of Ellis’s conduct — his failure to register his
kitchen laboratory with the FDA — does not fit within the FDCA’s
felony category. Because there is no evidence that Ellis failed to reg-
ister "with the intent to defraud or mislead" the FDA, see 21 U.S.C.
§ 333(a)(2), I would vacate his felony conviction on this count and
direct the district court to record a conviction for a misdemeanor.
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This appeal turns on what evidence the government had and did not
have against Ellis. There is considerable evidence that Ellis was
aware the FDA regulated GHB and that he was aware his production
and distribution of GHB violated FDA regulations. There is also evi-
dence that Ellis took steps to conceal his activities. For example, he
asked trusted acquaintances to buy raw materials (GBL and sodium
hydroxide) for him, and he developed a cover story to explain why
he had bought these materials himself. There is no evidence, however,
that Ellis knew he was required to register his kitchen laboratory with
the FDA or that he failed to register with the intent to mislead the
FDA.
Ellis was charged with three counts, all keyed to 21 U.S.C. § 331:
(1) conspiracy to commit offenses prohibited by 21 U.S.C. § 331,
namely, manufacturing and selling a misbranded drug in violation of
§ 331(k); (2) introducing misbranded GHB into interstate commerce
in violation of §§ 331(a) and (k); and (3) failing to register a labora-
tory in violation of § 331(p). Section 331 provides a list of over thirty
prohibited acts, ranging literally from (a) to (z) and (aa) to (gg). See
21 U.S.C. §§ 331(a)-(gg). The penalties for violations of § 331 are
found in 21 U.S.C. § 333. A simple violation of § 331 is a misdemea-
nor punishable by up to one year in prison or a maximum fine of
$1,000, or both. 21 U.S.C. § 333(a)(1). However, when a defendant
violates a provision of § 331 "with the intent to defraud or mislead,"
he may be convicted of a felony and sentenced to a maximum of three
years in prison or a maximum fine of $10,000, or both. 21 U.S.C.
§ 333(a)(2). Here, the government sought felony convictions against
Ellis on all three counts. The jury returned misdemeanor convictions
on the first two counts (conspiracy and selling misbranded GHB), but
it returned a felony conviction for Ellis’s failure to register his kitchen
laboratory with the FDA. Ellis concedes that there is sufficient evi-
dence to show that he operated an unregistered drug laboratory in vio-
lation of § 331(p). He argues, however, that the evidence is not
sufficient to prove that his failure to register was attended by any
intent to defraud or mislead the FDA, which is required for a felony
conviction under § 333(a)(2). I agree.
A person may be convicted for a misdemeanor violation of any of
the many provisions of § 331 without any knowledge or intent of
wrongdoing. See 21 U.S.C. § 333(a)(1); United States v. Abbott Labs.;
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505 F.2d 565, 573 (4th Cir. 1975) (noting that § 333(a)(1) "prescribes
a crime of which scienter is not a necessary element"); see also
United States v. Park, 421 U.S. 658, 672-73 (1975). To be convicted
of a felony, however, a person must "commit[ ] . . . a [§ 331] violation
with the intent to defraud or mislead." 21 U.S.C. § 333(a)(2). Our
court recognizes that "fraud is a crime requiring specific intent."
United States v. Mandel, 591 F.2d 1347, 1363 n.11 (4th Cir. 1979).
The majority concludes that specific intent may be proven when the
defendant acts with the broad purpose of evading the regulatory scru-
tiny of the FDA, regardless of whether he is aware of his particular
§ 331 violation. Such a generalized intent is not sufficient to establish
a specific intent to defraud or mislead for a felony conviction under
§ 333(a)(2). Rather, as the circuits that have considered the issue hold,
a § 333(a)(2) felony requires "a knowing violation [of a § 331 provi-
sion] with the specific intent ‘to defraud or mislead.’" United States
v. Mitcheltree, 940 F.2d 1329, 1350 (10th Cir. 1991) (emphasis
added). See also Geborde, 278 F.3d at 930 (reversing a felony convic-
tion under § 333(a)(2) because "[t]here was no evidence of [the defen-
dant’s] intent in failing to register, assuming he even knew he was
required to register"); United States v. Arlen, 947 F.2d 139, 143 (5th
Cir. 1991) ("[T]he government’s evidence is sufficient to make out a
violation of this section where it shows that the defendant intention-
ally violated § 331 with the specific intent to defraud or mislead an
identifiable government agency.") (emphasis added). In other words,
"[b]ecause ‘knowledge of the essential nature of the alleged fraud is
a component of the intent to defraud,’ a defendant cannot act with
intent to mislead or defraud under § 333(a)(2) without some knowl-
edge of" his specific § 331 violation. Mitcheltree, 940 F.2d at 1349
(quoting United States v. Hiland, 909 F.2d 1114, 1128 (8th Cir.
1990)). A felony conviction thus requires proof of an intent to defraud
or mislead that is "connected to" a specific § 331 violation. Id. See
also Hiland, 909 F.2d at 1128 (rejecting the government’s argument
"that a § 333(a)(2) violation consists of a completed misdemeanor
plus an intent to defraud or mislead that need not be connected to the
predicate violation of § 331"). In this case, then, to convict Ellis of a
felony violation of § 331(p), the government had to prove (1) that he
had some knowledge that he was required to register his kitchen labo-
ratory with the FDA and (2) that he failed to register with the intent
to defraud or mislead the agency. See Mitcheltree, 940 F.2d at 1351.
Under the majority’s interpretation of § 333(a)(2), a defendant in
this circuit can now be convicted of intentionally defrauding or mis-
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leading the FDA even though he was unaware that he was violating
a specific regulatory requirement and even though he did not violate
the requirement with the intent to avoid detection by the FDA.
According to the majority, as long as the defendant is aware that he
is in some measure subject to FDA regulation and he takes some steps
to avoid scrutiny by the FDA, he has acted "with the intent to defraud
or mislead" the agency with respect to any of the many acts prohib-
ited by § 331. In other words, under the majority’s interpretation of
§ 333(a)(2), a defendant who is unaware that he has violated a partic-
ular provision of § 331 can nevertheless be convicted of a felony as
long as he has done something to avoid regulatory scrutiny by the
FDA; the violation itself does not have to be committed with the
intent of avoiding detection. This interpretation improperly moves the
carefully drawn line between misdemeanors and felonies under
§ 333(a), leaving little on the misdemeanor side. Cf. Arlen, 947 F.2d
at 143. Because I would not relax the intent requirement for a felony
under § 333(a)(2), I respectfully disagree with the majority.
It appears that the jury had some difficulty in figuring out the
extent to which Ellis’s illicit drug trafficking fit the provisions of the
FDCA. There was evidence for the jury to find, though it did not, that
Ellis specifically intended to defraud or mislead the FDA when he
manufactured and sold misbranded GBH in violation of §§ 331(a) and
(k). The government offered evidence that Ellis was aware that the
FDA regulated GHB and that his production and distribution of the
substance violated FDA regulations. The government also offered
evidence that Ellis took measures, such as recruiting acquaintances to
buy raw materials for him, in order to avoid detection by regulatory
authorities. Thus, the jury could have concluded that Ellis had some
knowledge that his production and distribution of GHB violated the
law and that he engaged in these prohibited activities with the intent
to avoid detection by the FDA. The same is not true for Ellis’s failure
to register his kitchen laboratory.
The government did not offer any evidence that Ellis failed to reg-
ister his laboratory, as required by § 331(p), for the purpose of
defrauding or misleading the FDA or that he even knew of the regis-
tration requirement. As I have said, the evidence showed that Ellis
knew he should not make GHB and knew he should not sell it. The
evidence did not, however, demonstrate that Ellis knew he should reg-
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ister his home laboratory with the FDA. When there is no intentional
violation of a particular regulatory requirement, there cannot be a spe-
cific intent to defraud or mislead. Accordingly, the evidence was
insufficient to support Ellis’s felony conviction on count III for failure
to register under 21 U.S.C. § 331(p). I would therefore vacate his fel-
ony conviction on this count. However, because the evidence is suffi-
cient to sustain a misdemeanor conviction on this count under
§ 333(a)(1), I would direct the district court to enter an amended judg-
ment reflecting the appropriate conviction and sentence.
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