New Case Raises Doubts on FDA’s Authority to Obtain Restitution and Disgorgement

In recent years, the Food and Drug Administration (FDA) has embarked on a campaign to add restitution and disgorgement – remedies aimed at correcting past conduct – to FDA’s enforcement armamentarium, notwithstanding the absence of any statutory authority to do so.

FDA entered into several high-profile settlements with companies that agreed to disgorge very large sums based on the sale of products that FDA alleged violated the Federal Food, Drug, and Cosmetic Act (FDCA), and successfully litigated one court case in the 1990s.1 Even though the FDCA neither explicitly nor implicitly grants FDA the authority to ask a court to order restitution or disgorgement, FDA has continued its campaign, most recently against Lane Labs and RX Depot, Inc. A recent decision by the U.S. Court of Appeals for the District of Columbia Circuit, however, could stop FDA in its tracks.