United States v. Jack Watkins, United States of America v. Cap Tab Nutritional Formulating and Manufacturing Inc.

FERNANDEZ, Circuit Judge,

Dissenting:

I disagree with Watkins’ assertion that even though he did intentionally misstate the ingredients of the nutritional substances he was selling, he was improperly convicted because the government did not have evidence to show that the misstatements were material. There can be no doubt that Watkins intended to defraud and mislead purchasers into thinking they were purchasing one item when, in fact, they were purchasing a different, cheaper item. Of course, he did so because he knew that he could improve his own profits by so euchring his victims. That is the usual reason that a person like Watkins acts as he did here. However, he argues that even if he made more money and his victims, thus, not only had less, but also had a different kind of supplement, he cannot be guilty unless materiality is shown as a separate element. That is, he cannot have committed felony food and drug fraud, or even felony misleading, without that element. I do not agree.

Watkins relies on the general rule, set forth in Neder v. United States, 527 U.S. 1, 119 S.Ct. 1827, 144 L.Ed.2d 35 (1999), that when the word “fraud” is used, a material misrepresentation or concealment is required because it was required at common law. Id. at 20, 119 S.Ct. at 1839. In my *970view, the general rule is just that and no more, and this case cries out for a determination that the general rule was not what Congress had in mind. We are dealing, after all, with labeling of food and drugs. A person who buys those is entitled to know precisely what he is ingesting. It will not do to tell him that he is getting organic food, when, in fact, it is not organic. Nor will it do to tell him he is getting aspirin, when he is getting something else which is cheaper and supposedly just as efficacious. Who knows what the health effect might be, either now or years from now. With astonishing frequency, we hear reports that even when we know what we are ingesting, it turns out that it might have a hitherto unknown effect. For example, does manufactured vitamin C found in pills have the same effect as vitamin C which naturally occurs in fruits and vegetables? Lately we are told that perhaps it does not. How much worse it is when a supplier lies to us about the ingredients in his product! In my view, intentional misrepresentations in this area are ipso facto material because of their inevitable impact upon the victim, which is another way of saying that they need not be proved as part of the government’s case.

I believe that the Eighth Circuit’s approach to a somewhat similar statute covering misbranded meat products should apply here also. See United States v. Jor-gensen, 144 F.3d 550 (8th Cir.1998). That statute makes it a felony to misbrand meat products with intent to defraud. The court held:

Not requiring a materiality element is also consistent with the public policy underlying the Federal Meat Inspection Act. Congress has determined that the companies and people engaged in the food business have an affirmative duty to insure that the food they sell to the public is safe and properly labeled. Judicially adding a materiality requirement when none exists in the statutory text would not further congressional intent and would instead hinder it.

Id. at 559 (citations omitted). I recognize, of course, that the statute in question there did say that a product is misbranded if the label is “false or misleading in any particular,”1 and language of that sort does not seem to suggest that materiality is required. Id. That is somewhat more explicit than the language we must consider, but I see it as a distinction without a difference. It would, I expect, stun Congress to hear that it cares a great deal about the meat we ingest, but is rather more insouciant about other food products and drugs.

Moreover, contrary to his argument, Watkins is not aided by 21 U.S.C. § 321(n)’s language.2 That section provides that in deciding whether something is misbranded in the first place, we must consider exactly what the seller said — his representations. That makes sense, and here, for example, Watkins said that the product had one ingredient when he knew it had a different one. More than that, however, an additional stringent requirement is placed upon the seller. Once he has made representations about the prod*971uct, he must go on to give even more , information; he must inform buyers as to other facts which are material in light of the representations he did make, and further tell them of any facts which are material to consequences that might flow from the use of the product. That is very far from saying that he can quibble about how material his misrepresentations were in the first place; if they are false, they are false, and that is all. But even if they are technically true, the seller must eschew reliance on the technicality; he must also go on to explain anything that might materially affect the user’s perceptions. As I see it, that is even more onerous than a requirement that representations be truthful in all particulars. It means that the seller must be more than truthful; he must be punctilious in assuring that we understand what we are ingesting when we ingest it.

In fine, nothing could shake the foundation of our society more than a fear that people like Watkins can actively and intentionally tell us that we are putting one thing in our bodies when they know we are putting in something else entirely. To let wrongdoers of that kind escape felony penalties through quibbles about whether their intentional lies are material is enough to gaily the hardiest souls. It threatens to release the evils of tainted and misbranded food and drugs from the oubliette to which Congress has consigned them. We should not countenance that.

Thus, I respectfully dissent.

. See 21 U.S.C. § 601(n)(l).

. In pertinent part § 321(n) reads:

If an article is alleged to be misbranded because the labeling or advertising is misleading, then in determining whether the labeling or advertising is misleading there shall be taken into account (among other things) not
only representations made or suggested but also the extent to which the labeling or advertising fails to reveal facts material in the light of such representations or material with respect to consequences which may result from the use of the article....