X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Click here for the full text of this decision FACTS:This case centers around two Internet-based pharmacies that Clayton H. Fuchs established and operated. In 1999, Fuchs, then a licensed pharmacist, sought to capitalize on the Internet boom by setting up an online pharmacy. Initially, Dr. Stephen Thompson agreed to issue prescriptions or refills for patients who requested medication online. Fuchs would then dispense the medication, based on the physician’s prescriptions, to patients throughout the United States. Friendly began receiving orders through its website in April 1999. Once Friendly began offering controlled substances, sales skyrocketed. Fuchs hired several employees to work at Friendly. Among them was Eugene Gonzales, Fuchs’ step-father, who supervised several of the pharmacy’s employees. Friendly also employed Waldrick Lemons as a pharmacist. In May 2000, Fuchs decided to expand business by increasing the number of hydrocodone tablets per prescription from 40 to 100. Thompson initially resisted the increase but he eventually acquiesced and Fuchs increased Thompson’s payment to $100 per prescription. By August 2000, Friendly processed 150 to 200 requests for medication daily; hydrocodone, a Schedule III controlled substance, was the primary drug being dispensed. Cy Weich, a field compliance officer with the Texas State Board of Pharmacy (TSBP), inspected Friendly in August 2000. Weich was troubled by the high volume of prescriptions, especially controlled substances, that Friendly was dispensing. He was also concerned that nearly all of Friendly’s prescriptions were signed by one doctor located in Texas, despite the fact that the patients were dispersed nationwide. After consulting with TSBP’s general counsel, Weich informed Fuchs that the prescriptions generated through Friendly’s Web site were invalid. Fuchs then moved his operation to Norman, Okla., renaming it Main Street Pharmacy. By the time Main Street was shut down, the pharmacy was processing between 300 and 500 prescriptions per day, approximately 70 percent of which were for hydrocodone. Both Friendly and Main Street charged far more than the average price for each prescription. Neither pharmacy accepted payment through insurance; the pharmacies’ standard payment terms were C.O.D. On Nov. 20, 2002, the grand jury indicted Fuchs, Gonzales and Lemons for their involvement in the Web-based pharmacies. The second superseding indictment, on which the defendants were tried, contained six counts. Count one charged Fuchs and Lemons with conspiracy to distribute a controlled substance in violation of 21 U.S.C. �846. Count two charged Fuchs with engaging in a continuing criminal enterprise (CCE) in violation of 21 U.S.C. �848. Counts three, four and five charged Fuchs with dispensing of a controlled substance not in the usual course of professional practice in violation of 21 U.S.C. �841(a)(1). And count six charged Fuchs and Gonzales with conspiracy to commit money laundering in violation of 18 U.S.C. �1956(h). The jury convicted them on all counts. On the government’s motion, the court dismissed Fuchs’ indictment and conviction on count one. The district court sentenced the trio and they timely appealed their convictions. HOLDING:Affirmed. Fuchs alleged that there was plain error in both the indictment and the jury instruction because they permitted him to be charged and convicted without proof that he dispensed controlled substances without a legitimate medical reason. Under current law, the court stated, a medical professional can be prosecuted under �841 when his activities fall outside the usual course of professional practice. There is no clearly established law, the court stated, in the Fifth Circuit that the indictment and jury instructions must include a reference to legitimate medical purpose. The court then concluded that the indictment and jury instruction were devoid of plain error. Fuchs and Gonzales contended that the district court erred by instructing the jury that it could find that a defendant’s deliberate ignorance satisfied the knowledge requirement. The court found sufficient evidence to support an inference that Fuchs and Gonzales purposely contrived to avoid learning of the illegal conduct; thus, the instruction was within the court’s discretion The court found no reversible error in the jury instructions. Because there was sufficient circumstantial evidence from which a rational jury could have inferred both an agreement to violate 18 U.S.C. �1957(a) and the defendants’ knowledge of the agreement, the court affirmed the district court’s denial of the motions of judgment of acquittal as to count six, the conspiracy to commit money laundering count. With respect to the charge against Lemons, the court found that a rational jury could have found beyond a reasonable doubt each of the elements of conspiracy to dispense a controlled substance outside the usual course of professional practice. The court declined to set aside the district court’s denial of the new-trial motions because it would have been an abuse of discretion had the district court granted them. The court found that there was more than sufficient evidence of Fuchs’ and Gonzales’ guilt and the evidence did not approach preponderating against the verdict. OPINION:King, J.; King, Garwood and Jolly, J.J.

Want to continue reading?
Become a Free ALM Digital Reader.

Benefits of a Digital Membership:

  • Free access to 1 article* every 30 days
  • Access to the entire ALM network of websites
  • Unlimited access to the ALM suite of newsletters
  • Build custom alerts on any search topic of your choosing
  • Search by a wide range of topics

*May exclude premium content
Already have an account?

 
 

ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.