Guidance on Guidance on Guidance

As one of her final acts before leaving DOJ, Associate Attorney General Rachel Brand announced that DOJ would no longer permit its lawyers to use guidance documents issued by its “client” agencies as a basis for civil enforcement. The “Brand Memo” provides guidance about DOJ’s use of guidance, as we described here.

In a couple of coordinated speeches, DOJ officials reiterated and clarified this position. Deputy Associate Attorney General Stephen Cox, who worked closely with Rachel Brand, spoke at the Federal Bar Association Qui Tam Conference on February 28, 2018. Cox described federal agencies’ use of guidance in lieu of formal regulatory rulemaking required under the Administrative Procedure Act: “Rulemaking can be cumbersome and slow, of course, and sometimes agencies have used guidance as a short-cut to effectively make new rules when they should have undertaken notice-and-comment rulemaking instead.” He referenced a recommendation from the Administrative Conference of the United States (ACUS) to make clear that “the public may take a lawful approach different from the one set forth in” a guidance document. Per Cox, the Brand memo implements the ACUS recommendation: “The Brand Memo makes clear that we won’t be using noncompliance with a guidance document to prove a violation of the applicable statute or regulation. In other words, we won’t use our affirmative civil enforcement authority to effectively convert a nonbinding guidance document into a requirement that has the force or effect of law.”

There are many potential applications of the Brand Memo in the FDA context, given FDA’s prolific guidance document library. As an illustration, FDA regulation requires the submission of a new 510(k) under certain circumstances, and FDA guidance walks through the analysis FDA recommends to determine whether a new 510(k) is required. Many companies prepare a Letter to File to evidence its decision not to file a new 510(k), but this is not a requirement by statute or regulation. Per DOJ policy, “if there’s a guidance document that expands upon that regulatory requirement – by suggesting that there are additional requirements or prohibitions that go beyond what the regulation actually says – then we’re not going to use noncompliance with those supposed ‘requirements’ to show that a party violated the regulation.” Thus, a company’s failure to document its decisionmaking cannot be used to solely support a civil enforcement action against a company for failing to submit a new 510(k).

These thoughts were reinforced by Ethan Davis, the soon-to-be former Deputy Assistant Attorney General for the Consumer Protection Branch (CPB), who is leaving DOJ to clerk for Supreme Court Justice Neil Gorsuch. Because CPB specifically counts FDA as its client, Davis’ remarks in his speech are specifically relevant to FDA Law Blog readers. He described the basic tenet that “[i] n our system, law is made by statute, and regulations are made by notice and comment rulemaking. Neither should be made by guidance documents.” And Davis renewed the commitment by DOJ CPB to “create an enforcement environment premised on the rule of law, so that you as regulated entities do not feel subjected to arbitrary and unpredictable enforcement actions.”

Only time will tell whether these DOJ principles are followed in future enforcement actions, but it behooves companies to remind DOJ of these stated principles if prosecution appears not grounded in law and only in guidance.