United States District Court, D. Connecticut
RULING ON PENALTIES
C. Hall United States District Judge
November 22, 2016, Dr. Ajay S. Ahuja, M.D. (“Dr.
Ahuja”), the defendant, admitted liability for
twenty-three counts of civil violations of the Controlled
Substances Act (“CSA”), 21 U.S.C. § 801
et. seq. See Minute Entry (Doc. No. 126)
(“Dr. Ahuja admitted each of Counts 1-23.”); Am.
Compl. (Doc. No. 106) (alleging twenty-three CSA violations).
The plaintiff, the United States (“the
Government”), asks the court to assess civil penalties
against Dr. Ahuja of $496, 500,  see March 7, 2017
Hearing Transcript (“Tr.”) (Doc. No. 153) at 143,
and asks the court to order Dr. Ahuja “to comply with
all federal laws and regulations pertaining to receipts,
dispensations, and inventories of controlled
substances” in the future, Am. Compl. at 8. Dr. Ahuja
argues that the amount of penalties should be $28, 462.16.
See Tr. at 155.
court accepted written affidavits in lieu of direct testimony
and held an evidentiary hearing to hear cross-examination in
order to then determine the amount of
reasons that follow, the court ORDERS Dr. Ahuja to pay $200,
000 and to comply with all federal laws and regulations
pertaining to receipts, dispensations, and inventories of
controlled substances in the future.
Ahuja is a practitioner registered with the Drug Enforcement
Administration and authorized to handle controlled
substances. See Am. Compl. at 1. The counts, all of
which Dr. Ahuja admits, set forth the following violations:
One through Eight set forth violations of section 842(a)(5)
of title 21 of the United States Code and section 1304.04(a) of
title 21 of the Code of Federal Regulations,  based on failure
to maintain controlled substance receipt records for (1)
seventeen shipments of Alprazolam, see Am. Compl.
Count I, (2) eight shipments of Hydrocodone Bitartrate with
Acetaminophen, see id. Count II, (3) seven shipments
of Guaifenesin with Codeine Phosphate, see id. Count
III, (4) one shipment of Testosterone Cypionate, see
id. Count IV, (5) one shipment of Zolpidem Tartrate,
see id. Count V, (6) ten shipments of 75-milligram
Lyrica tablets, see id. Count VI, (7) eight
shipments of 50-milligram Lyrica tablets, see id.
Count VII, and (8) one partially-used vial of
Depo-Testosterone, see id. Count VIII.
Nine sets forth a violation of section 1304.04(f)(2) of title
21 of the Code of Federal Regulations for failure to separate
controlled substance records for Schedule III, IV, and V
substances from records for non-controlled substances.
See Am. Compl. Count IX.
Ten sets forth a violation of section 827(a)(1) of title 21
of the United States Code and section 1304.11(c) of title 21 of
the Code of Federal Regulationsbased on failure “to perform
and maintain a biennial inventory of controlled
substances.” Am. Compl. Count X.
Eleven and Twelve set forth violations of section 827(a)(3)
of title 21 of the United States Code,  and either
section 1304.21(a) or 1304.22(c) of title 21 of the Code
of Federal Regulations, for failures (11) “to maintain
accurate dispensing records for” Alprazolam, resulting
in failure to account for 59 bottles, Am. Compl. Count XI,
and (12) to properly complete a dispensation log for 517
bottles of this drug, see Id. Count XII.
Thirteen and Fourteen set forth violations of section
827(a)(3), and either section 1304.21(a) or 1304.22(c), for
failures (13) “to maintain accurate dispensing records
for” Hydrocodone Bitartrate with Acetaminophen,
resulting in failure to account for 21 bottles, Am. Compl.
Count XIII, and (14) to properly complete a dispensation log
for 92 bottles of this drug, see id. Count XIV.
Fifteen and Sixteen set forth violations of section
827(a)(3), and either section 1304.21(a) or 1304.22(c), for
failures (15) “to maintain accurate dispensing records
for” Guaifenesin with Codeine Phosphate, resulting in
failure to account for 58 bottles, Am. Compl. Count XV and
(16) to properly complete dispensation logs for 154 bottles
of this drug, see id. Count XVI.
Seventeen and Eighteen set forth violations of section
827(a)(3) and section 1304.21(a) for failure “to
maintain accurate dispensing records for” (17)
Testosterone Cypionate, resulting in failure to account for
two vials, Am. Compl. Count XVII, and (18) Zolpidem Tartrate,
resulting in failure to account for three bottles,
id. Count XVIII.
Nineteen and Twenty set forth violations of sections
842(a)(1) and 842(c)(1)(A) of title 21
of the United States Code, and section 1306.04(a) of title 21
of the Code of Federal Regulations,  for dispensing
“controlled substances outside of the usual course of
[Dr. Ahuja's] professional practice, ” namely, (19)
to Dr. Ahuja's ex-wife, Gurpreet Ahuja
(“Gurpreet”), either Hydrocodone with
Acetaminophen, or Alprazolam, on a total of four different
occasions, Am. Compl. Count XIX; see also Dr. Ahuja
Aff. (Def. Ex. A) ¶ 7(1) (clarifying that “Jane
Doe #1, ” referred to in this Count, is Gurpreet), and
(20) to his son, Sunny Ahuja, Guaifenesin with Codeine, on
two different occasions, id. Count XX; see
also Sunny Ahuja (“Sunny”) Aff. (Def. Ex. C)
¶ 5 (clarifying that “John Doe #1, ”
referred to in this Count, is Sunny).
Twenty-One and Twenty-Two set forth violations of sections
842(a)(1) and 842(c)(1)(A),  and section 1306.04(a) of
title 21 of the Code of Federal Regulations, for prescribing
“controlled substances outside of the usual course of
[Dr. Ahuja's] professional practice, ” namely, (21)
to his son, Nicholas Ahuja (“Nicholas”),
Zolpidem, on five different occasions, Am. Compl. Count XXI;
see also Nicholas Aff. (Def. Ex. B) ¶ 5
(clarifying that “John Doe #2” listed in this
Count is Nicholas), and (22) to his brother, Uttam Ahuja
(“Uttam”), either Cheratussin AC, Hydrocodone
Bitartrate, or Hydrocodone Chlorpheniramine, on a total of
three different occasions, id. Count XXII; see
also Uttam Aff. (Def. Ex. D) ¶ 5 (clarifying that
“John Doe #3” listed in this Count is Uttam).
Twenty-Three sets forth violations of section 842(a)(1) and
842(c)(1)(A) of title 21 of the United States
Code for illegal possession of two (full or
partial) bottles of Alprazolam which had previously been
dispensed to Nicholas or Uttam. See Am. Compl. Count
penalties for the various violations of law by Dr. Ahuja are
set out in the statutes. “[A]ny person who
violates” section 842(a)(1), “shall, with respect
to any such violation, be subject to a civil penalty of not
more than $25, 000.” 21 U.S.C. § 842(c)(1)(A).
“In the case of a violation of” section
842(a)(5), “the civil penalty shall not exceed $10,
000.” 21 U.S.C. § 842(c)(1)(B).
parties agree that the Second Circuit's decision in
Advance Pharmaceutical, Inc. v. United
States, 391 F.3d 377 (2d Cir. 2004), provides the
standard for determining the size of a reasonable penalty.
See Pl.'s Mem. (Doc. No. 134) at 1; Def.'s
Mem. (Doc. No. 135) at 1. According to Advance
district court may properly consider a number of factors in
determining the size of a civil penalty, including the good
or bad faith of the defendants, the injury to the public, and
the defendant['s] ability to pay. Thus, in determining
monetary penalties under § 842(c), district courts have
frequently considered four factors: (1) the level of
defendant's culpability, (2) the public harm caused by
the violations, (3) defendant's profits from the
violations, and (4) defendant's ability to pay a penalty.
391 F.3d at 399 (internal quotation marks and citation
omitted); Pl.'s Mem. at 1-2; Def.'s Mem. at 1-2.
FINDINGS OF FACT
court finds that Dr. Ahuja engaged in the following conduct,
or lack of conduct: (1) Dr. Ahuja dispensed controlled
substances directly from his practice, despite the fact that
most physicians choose instead to only “write
prescriptions” and have “pharmacies dispense the
medicines, ” see, e.g., Marcie L. Johnson
(“Johnson”) Aff. (Gov. Ex. 39) ¶ 14, (2) Dr.
Ahuja prescribed controlled substances to family members,
see, e.g., id. ¶ 11; Dr. Ahuja Aff.
¶ 7(1), (3) Dr. Ahuja failed to make proper notations in
family members' patient charts when prescribing
controlled substances to them, see, e.g., Tr. at
61-62, (4) Dr. Ahuja failed to properly record dispensations
in his dispensation log, see Dr. Ahuja Aff. ¶
7(e), (g), (i), (5) Dr. Ahuja failed to conduct a biennial
inventory of the controlled substances he had on hand, for
three to four years in a row, see Am. Compl. Count
X; Johnson Aff. ¶ 28; Dr. Ahuja Aff. ¶ 7(d); Tr. at
112; and, as a result of this failure to conduct a biennial
inventory, Dr. Ahuja lacked a method of noting whether
controlled substances had gone missing, see Tr. at
112, (6) Dr. Ahuja cannot account for certain medications,
see, e.g., Dr. Ahuja Aff. ¶ 7(d), (f), (h),
(j), (m), (k), (7) Dr. Ahuja consistently failed to upload
information to the Connecticut Prescription Monitoring and
Reporting System (CPMRS) regarding his dispensations of
controlled substances to patients, thus preventing other
doctors from knowing whether their patients may have been
receiving controlled substances from more than one source,
see Rodrick J. Marriott (“Marriott”)
Aff. (Gov. Ex. 37) ¶ 8; Tr. at 103, and, (8) if Dr.
Ahuja's own theory were to be credited (which it is not),
due to his insufficient security measures and failure to
properly keep track of his medication, Dr. Ahuja allowed
controlled substances to be stolen by his former secretary,
who presumably used the substances for an illicit purpose;
and Dr. Ahuja then failed to report this diversion to law
enforcement officials, see Tr. at 95-96, 110-12,
court credits and agrees with the opinion of University of
Connecticut School of Medicine Assistant Clinical Professor
in Family Medicine, Dr. Adam Perrin, M.D. (“Dr.
Perrin”), that Dr. Ahuja's behavior reflects
“a blatant disregard for the rigor and careful
oversight required for the safe and proper dispensing and
prescribing of controlled substances.” Dr. Perrin
Expert Report at 8. While Dr. Ahuja testified that he
“was making an attempt to keep the required records,
” Dr. Ahuja Aff. ¶ 7, the court views those
efforts as essentially non-existent.
court finds that, with regard to Dr. Ahuja's family
members who were given controlled substances, (1) the
medications were given to treat bona fide illnesses, (2) Dr.
Ahuja checked up with them regarding the medications and the
illnesses, and (3) the medications were effective.
See Nicholas Aff. ¶ 5, Sunny Ahuja Aff. ¶
5, Uttam Aff. ¶ 6.
the court finds that approximately $28, 500 worth of drugs
were diverted for non-medical purposes due to Dr. Ahuja's
violations. Dr. Ahuja-in an apparent attempt to buttress his
argument that he had not taken drugs from his own
supply-presented a theory that his former secretary had
stolen the missing medications from him, under circumstances
that lead to the conclusion that the secretary would have
used or sold the drugs for non-medical purposes. See
Tr. at 95- 96; see also Tr. at 111 (clarifying that
Dr. Ahuja believes the secretary took all his missing
medication). According to DEA Diversion Group Supervisor
Leonard Levin (“Levin”), the total street value
for all the unaccounted-for medications is $28, 462.18.
See Levin Aff. ¶ 27. The court notes that, if
Dr. Ahuja invented his theory about the secretary stealing
his drugs to deflect attention from his own malfeasance, the
court can only assume that the truth is something worse than
the secretary stealing the drugs- such as Dr. Ahuja directly
diverting this $28, 500 worth of controlled substances by
consuming them himself or distributing them for non-medical
purposes at a price of $4 per Alprazolam pill, $7 per
Hydrocodone pill, $13.50 per bottle of Guaifenesin with
Codeine, $84.89 per vial of Testosterone Cypionate, and
$20.67 per bottle of Zolpidem tartrate. See id.
court finds, as Johnson testified, that “[t]he failure
to report” the dispensation of controlled substances,
allows for the diversion of controlled substances.
Specifically, the patient can be seeing another provider and
the other provider would have no way of knowing that the
patient is also receiving controlled substances from Dr.
Ahuja. This exposes the patient and, if the patient is not
personally using the controlled substances, the community, to
Aff. ¶ 63. The court further finds, based on Dr.
Perrin's testimony, that, for a practitioner to have
“controlled substances on site” involves an
“inherent risk of theft and misuse, ” which
“calls for strict policy and procedure in establishing
a protocol to insure security, proper handling and
appropriate dispensing practices.” Dr. Perrin Expert
Report at 8. By failing to exercise proper vigilance, the
court finds that Dr. Ahuja created a volatile situation that
put his patients and family members at risk of harm from
improper use of addictive substances. Id. at 8;
see also Dr. Ahuja Aff. ¶ 11 (stating that Dr.
Ahuja does “not dispute that wide spread abuse of
controlled substances has reached crisis levels in the United
States at this time”).
court finds that Dr. Ahuja can be expected to have made a
profit of approximately $3, 000 from his CSA violations. As
detailed below, this profit estimation is based on the
estimated retail value of the unaccounted-for drugs,
subtracting the estimated cost Dr. Ahuja paid to buy these
drugs. In making a profit finding, the court was required to
decide between counting either (1) the retail value of the
missing drugs, or (2) their street value. In deciding to use
the retail value, the court does not simply rely on Dr.
Ahuja's testimony that he sold the drugs at their retail
value, see Dr. Ahuja Aff. ¶ 10, because the
court does not find Dr. Ahuja to be credible. However, the
Government has presented no evidence that Dr. Ahuja operated
his medical office as a “pill factory” or
“pill mill, ” meaning an illegal prescription
drug dealing business disguised as a medical office, that
exists solely to distribute controlled substances. See,
e.g., United States v. Duprey, 652 F.App'x
107, 108-09 (3d Cir. 2016) (describing as “pill
factory” doctor's office where numerous
pseudo-patients received weekly, highly uniform, controlled
substance prescriptions, for the purpose of giving their
pills to the doctor's co-conspirator; and affirming
conviction of co-conspirator, who drove pseudo-patients to
the doctor's office and to the pharmacist-another
co-conspirator-before collecting pills from pseudo-patients
and reselling them); United States v. Guzman, 571
F.App'x 356, 357-58, 360 (6th Cir. 2014) (agreeing that
use of term “pill mill” accurately described
allegations, and affirming conviction, where defendant ran a
purported pain management clinic, which “bore all the
hallmarks of an illegal operation, ” such as an
unusually high amount of customer traffic-including customers
from several other states, and customers who arrived in large
groups all to receive the same type of prescription-, drug
deals occurring in the parking lot, customers lingering in
cars outside the clinic in a semi-conscious state, people
“sponsor[ing]” customers to buy drugs for them,
“skyrocket[ting]” prescription drug use in the
county after the business opened, an emphasis on speed rather
than careful patient examinations, a refusal to accept
insurance coupled with an unusually large amount of business
done in cash, the fact that patients generally had no obvious
symptoms, and the fact that patients often requested specific
forms of drugs-such as drugs with particular markings). The
Government has not argued that Dr. Ahuja's medical office
was run as a pill factory or pill mill, and it has presented
no evidence from which the court could infer that Dr.
Ahuja's business was run in this way. For instance, the
Government has presented no evidence (1) that every
patient received controlled substances, rather than at least
some patients receiving medical care that did not ...