United States v. Dotterweich

1943-11-22

Headline: Court allows criminal liability for corporate officers who ship adulterated or misbranded drugs, reversing a lower court and making it easier to prosecute company executives even without proof of guilty intent.

Holding: The Court reversed the lower court and held that corporate officers can be criminally prosecuted under the Food, Drug, and Cosmetic Act for shipping adulterated or misbranded drugs, even without proof they knew of the wrongdoing.

Real World Impact:

Allows prosecutors to charge corporate officers for shipping unsafe drugs.
Holds executives liable even without proof of guilty intent.
Encourages executives to verify suppliers and shipments.

Topics: consumer safety, corporate criminal liability, food and drug regulation, executive responsibility

Summary

Background

A drug wholesaler bought medicines from manufacturers, repacked them under its own label, and shipped them between states. The company and its president and general manager were charged with sending adulterated or misbranded drugs into interstate commerce. A jury acquitted the company but found the president guilty. The appeals court reversed, reading a seller’s guaranty clause to limit who could be prosecuted, and the Government asked the Supreme Court to decide the matter.

Reasoning

The central question was whether people who run or act for a company can be criminally prosecuted under the Food, Drug, and Cosmetic Act for shipping unsafe or mislabeled drugs even if they did not knowingly commit a crime. The Court said the law aims to protect public health and places the risk on those who stand in a responsible relation to dangerous transactions. The phrase “any person” includes both corporations and individuals, and those who help carry out the shipment can be held guilty unless a qualifying guaranty protects the transaction. Whether an individual is responsible is a question for the jury based on the evidence. The Court reversed the appeals court and found the evidence sufficient to support the conviction.

Real world impact

The decision makes it more feasible for prosecutors to charge company executives and managers in cases involving adulterated or misbranded drugs, even without proof they knew of the wrongdoing. It pushes some of the burden for consumer safety onto executives who have the opportunity to check suppliers and operations. Trials, judges, and juries will decide individual responsibility in each case.

Dissents or concurrances

A dissent warned that criminal guilt should be personal and that Congress must clearly say when officers face vicarious criminal liability; the dissent emphasized there was no evidence the officer knew of any wrongdoing.