Phong H. Tran, M.D.; Decision and Order

Federal Register Extracts

Drug Enforcement Administration

On October 4, 2023, the Drug Enforcement Administration (DEA or Government) issued an Order to Show Cause (OSC) to Phong H. Tran, M.D. (Respondent). OSC, at 1, 3. The OSC proposed the denial of Respondent's application for a DEA Certificate of Registration (registration), Control No. W22138631C, in California, alleging that Respondent has been mandatorily excluded from participation in Medicare, Medicaid, and all Federal health care programs pursuant to 42 U.S.C. 1320a-7(a). Id. at 1-2 (citing 21 U.S.C. 824(a)(5)).

A hearing was held before DEA Administrative Law Judge (ALJ) Teresa A. Wallbaum who, on August 9, 2024, issued her Recommended Rulings, Findings of Fact, Conclusions of Law, and Decision of the Administrative Law Judge (RD). The RD recommended that Respondent's application be denied. RD, at 29. Neither party filed exceptions to the RD. Having reviewed the entire record, the Agency adopts and hereby incorporates by reference the entirety of the ALJ's rulings, credibility findings, /1/ findings of fact, conclusions of law, sanctions analysis, and recommended sanction in the RD, and summarizes and expands upon portions thereof herein.

FOOTNOTE 1 The Agency adopts the ALJ's summary of the witnesses' testimonies as well as the ALJ's assessment of the witnesses' credibility. RD, at 5-29. The Agency agrees with the ALJ that the testimony from the DEA Diversion Investigator (DI), which was primarily focused on the introduction of the Government's documentary evidence, was "sufficiently plausible, internally consistent, and corroborated by the documentary evidence to be afforded full credibility." Id. at 8. END FOOTNOTE

The Agency also adopts the ALJ's conclusion that "Respondent lacks state authority to handle controlled substances in the State of California, the state in which he is registered. . . ." RD, at 29. /2/

FOOTNOTE 2 The lack of state authority allegation was not noticed in the OSC. However, DEA has consistently held that because the possession of state authority is a prerequisite for obtaining and maintaining a registration, the issue of state authority can be raised at any stage of a proceeding. See, e.g., Hatem M. Ataya, M.D., 81 FR 8221, 8244 (2016) (noting that "because the possession of state authority is a prerequisite for obtaining a registration and for maintaining a registration, the issue can be raised sua sponte even at this stage of the proceeding"); Joe W. Morgan, D.O., 78 FR 61961, 61973-74 (2013); see also Gonzales v. Oregon, 546 U.S. 243, 270 (2006) (finding that the possession of authority to dispense controlled substances under the laws of the state in which a practitioner engages in professional practice is a fundamental condition for obtaining and maintaining a practitioner's registration). Neither the CSA nor DEA's implementing regulations requires that the Government amend the OSC to add a lack of state authority allegation if the Government obtains evidence during the pendency of a proceeding of a registrant's lack of state authority. Here, Respondent raised the issue of his lack of state authority in his Post-Hearing Brief, ALJX 31, at 2 n.2, and the ALJ afforded both parties notice and an opportunity to be heard on the issue before issuing the RD. RD, at 2; ALJX 33. END FOOTNOTE

I. Loss of State Authority

A. Findings of Fact

On August 2, 2024, the Medical Board of California revoked Respondent's California medical license. RD, at 2, 4; ALJ Exhibit (ALJX) 34. /3/ According to California's online records, of which the Agency takes official notice, Respondent's California medical license remains revoked. /4/ California DCA License Search, https://search.dca.ca.gov/ (last visited date of signature of this Order). Accordingly, the Agency finds substantial record evidence that Respondent is not licensed to practice medicine in California, the state in which he is registered with DEA. /5/

FOOTNOTE 3 See also Respondent's Post-Hearing Brief, at 2 n.2 ("The court is hereby notified that Respondent's California medical license was revoked by the Medical Board, effective August 2, 2024."). END FOOTNOTE

FOOTNOTE 4 Under the Administrative Procedure Act, an agency "may take official notice of facts at any stage in a proceeding--even in the final decision." United States Department of Justice, Attorney General's Manual on the Administrative Procedure Act 80 (1947) (Wm. W. Gaunt & Sons, Inc., Reprint 1979). END FOOTNOTE

FOOTNOTE 5 Pursuant to 5 U.S.C. 556(e), "[w]hen an agency decision rests on official notice of a material fact not appearing in the evidence in the record, a party is entitled, on timely request, to an opportunity to show the contrary." The material fact here is that Respondent, as of the date of this decision, is not licensed to practice medicine in California. Accordingly, Respondent may dispute the Agency's finding by filing a properly supported motion for reconsideration of findings of fact within fifteen calendar days of the date of this Order. Any such motion and response shall be filed and served by email to the other party and to the DEA Office of the Administrator, Drug Enforcement Administration at [email protected]. END FOOTNOTE

B. Discussion

Pursuant to 21 U.S.C. 824(a)(3), the Attorney General is authorized to suspend or revoke a registration issued under 21 U.S.C. 823 "upon a finding that the registrant . . . has had his State license or registration suspended . . . [or] revoked . . . by competent State authority and is no longer authorized by State law to engage in the . . . dispensing of controlled substances."

With respect to a practitioner, DEA has also long held that the possession of authority to dispense controlled substances under the laws of the state in which a practitioner engages in professional practice is a fundamental condition for obtaining and maintaining a practitioner's registration. Gonzales v. Oregon, 546 U.S. 243, 270 (2006) ("The Attorney General can register a physician to dispense controlled substances 'if the applicant is authorized to dispense . . . controlled substances under the laws of the State in which he practices.' . . . The very definition of a 'practitioner' eligible to prescribe includes physicians 'licensed, registered, or otherwise permitted, by the United States or the jurisdiction in which he practices' to dispense controlled substances. SEC 802(21)."). The Agency has applied these principles consistently. See, e.g., James L. Hooper, M.D., 76 FR 71371, 71372 (2011), pet. for rev. denied, 481 F. App'x 826 (4th Cir. 2012); Frederick Marsh Blanton, M.D., 43 FR 27616, 27617 (1978). /6/

FOOTNOTE 6 This rule derives from the text of two provisions of the Controlled Substances Act (CSA). First, Congress defined the term "practitioner" to mean "a physician . . . or other person licensed, registered, or otherwise permitted, by . . . the jurisdiction in which he practices. . . , to distribute, dispense, . . . [or] administer . . . a controlled substance in the course of professional practice." 21 U.S.C. 802(21). Second, in setting the requirements for obtaining a practitioner's registration, Congress directed that "[t]he Attorney General shall register practitioners . . . if the applicant is authorized to dispense . . . controlled substances under the laws of the State in which he practices." 21 U.S.C. 823(g)(1). Because Congress has clearly mandated that a practitioner possess state authority in order to be deemed a practitioner under the CSA, DEA has held repeatedly that revocation of a practitioner's registration is the appropriate sanction whenever he is no longer authorized to dispense controlled substances under the laws of the state in which he practices. See, e.g., James L. Hooper, M.D., 76 FR 71371-72; Sheran Arden Yeates, M.D., 71 FR 39130, 39131 (2006); Dominick A. Ricci, M.D., 58 FR 51104, 51105 (1993); Bobby Watts, M.D., 53 FR 11919, 11920 (1988); Frederick Marsh Blanton, M.D., 43 FR 27617. END FOOTNOTE

According to California statute, "dispense" means "to deliver a controlled substance to an ultimate user or research subject by or pursuant to the lawful order of a practitioner, including the prescribing, furnishing, packaging, labeling, or compounding necessary to prepare the substance for that delivery." Cal. Health & Safety Code section 11010 (2024). Further, a "practitioner" means a person "licensed, registered, or otherwise permitted, to distribute, dispense, conduct research with respect to, or administer, a controlled substance in the course of professional practice or research in [the] state." Id. section 11026(c).

Here, the undisputed evidence in the record is that Respondent currently lacks authority to practice medicine in California. As discussed above, a physician must be a licensed practitioner to dispense a controlled substance in California. Thus, because Respondent currently lacks authority to practice medicine in California and, therefore, is not currently authorized to handle controlled substances in California, Respondent is not eligible to obtain or maintain a DEA registration. Accordingly, the Agency will order that Respondent's application for a DEA registration be denied.

II. Mandatory Exclusion From Federal Health Care Programs /7/

FOOTNOTE 7 Although DEA lacks authority to grant Respondent's registration application because he lacks state authority, DEA considers Respondent's mandatory exclusion from federal healthcare programs as a separate, independent ground to deny Respondent's application. END FOOTNOTE

A. Findings of Fact

In 2018, Respondent pled guilty to one count of conspiracy to commit honest services mail fraud and healthcare fraud in violation of 18 U.S.C. 1349. RD, at 3; Government Exhibit (GX) 5, 7. As a result of Respondent's criminal conviction based on his guilty plea, the U.S. Department of Health and Human Services, Office of Inspector General (HHS/OIG), excluded Respondent, effective September 20, 2022, from participation in Medicare, Medicaid, and all federal health care programs pursuant to 42 U.S.C. 1320a-7(a) for a period of twelve years. /8/ RD, at 3; GX 8. Accordingly, the Agency finds substantial record evidence that Respondent has been, and continues to be, excluded from participation in federal healthcare programs.

--This is a summary of a Federal Register article originally published on the page number listed below--

Citation: "90 FR 14383"

Document Number: "Docket No. 24-12"

Federal Register Page Number: "14383"

"Notices"