ALBERT F. WILLIAMS, )
vs. )
Respondent. )
Case No. 01-3273F
vs. )
Respondent. )
Case No. 01-3274F
Notice was provided and on June 24, 2002, a formal hearing was held in the above-styled consolidated cases. The hearing location was Clearwater, Florida. The authority for conducting the hearing is set forth in Section 120.569 and Subsection 120.57(1), Florida Statutes. The hearing was conducted by
Fred L. Buckine, Administrative Law Judge, Division of Administrative Hearings.
For Petitioners: B. Edwin Johnson, Esquire
For Respondent: Reginald D. Dixon, Esquire
At issue is whether Petitioners, Albert F. Williams and Stitch Enterprises, d/b/a Skycrest Pharmacy, are entitled to an award of attorney's fees and costs pursuant to Section 57.111, Florida Statutes, the "Florida Equal Access to Justice Act," and if so, what amount would be reasonable.
On June 23, 1999, Respondent filed Administrative Complaints against Petitioner, Albert F. Williams (DOAH Case No. 00-0315), and Petitioner, Stitch Enterprises, d/b/a Skycrest Pharmacy (DOAH Case No. 00-0220), alleging that each had violated pharmacy law by repackaging, holding or offering for sale any drug, device or cosmetic that is adulterated or misbranded.
Both Petitioners filed Election of Rights forms indicating that Petitioners disputed material facts asserted in the Administrative Complaints and requesting formal evidentiary
hearings before the Division of Administrative Hearings pursuant to Section 120.57, Florida Statutes. On March 3, 2000, Petitioners filed a Motion to Consolidate the two cases hereinabove, and on March 24, 2000, the Order of Consolidation was entered. On November 17, 2000, a formal evidentiary hearing on the hereinabove consolidated cases was held in Clearwater, Florida, before the undersigned Administrative Law Judge.
At the final hearing, counsel for Petitioners acknowledged and agreed with Respondent that subsequent to the filing of the Administrative Complaint against Stitch Enterprises, d/b/a Skycrest Pharmacy, the corporation had been administratively dissolved by the Florida Secretary of State. Petitioner's counsel further agreed that because of the administrative dissolution of Stitch Enterprises, d/b/a Skycrest Pharmacy, Skycrest would voluntarily surrender its pharmacy license to Respondent within 30 days of November 17, 2000. Counsel for Respondent, based upon that proffer by counsel for Petitioner, agreed and voluntarily dismissed the Administrative Compliant against Stitch Enterprises, d/b/a Skycrest Pharmacy, and only prosecuted the Administrative Complaint against Albert F. Williams. This stipulation between the parties was accepted by the undersigned, and the final hearing was conducted accordingly.
On January 9, 2001, the undersigned entered a Recommended Order recommending dismissal of the Administrative Complaint against Albert F. Williams because Respondent did not meet its burden of proof. Respondent subsequently entered a Final Order adopting the undersigned's Recommended Order.
On August 17, 2001, Petitioners' counsel filed an Application for an Award of Attorney's Fees and Costs, pursuant to the Florida Equal Access to Justice Act, Section 57.111, Florida Statutes. Albert F. Williams' application for attorney's fess and costs was assigned DOAH Case No. 01-3273F, and Stitch Enterprises, d/b/a Skycrest Pharmacy's, application for attorney's fees and cost was assigned DOAH Case No. 01- 3274F. On January 15, 2002, an Order of Consolidation of the aforementioned two cases was issued.
On June 24, 2002, an evidentiary hearing on Petitioners' Application for an Award of Attorney's Fees and Costs was held in Clearwater, Florida. At the hearing, Petitioners' counsel called no witnesses, offered no exhibits in evidence and elected to rest its case for determination of entitlement of the Application for an Award of Attorney's Fees and Costs on the pleadings1 filed in support of the application, reserving the right to call rebuttal witnesses after presentation of evidence by Respondent.
Respondent called two Department of Health employees as witnesses: Catherine Gilyard, Administrative Assistant II; and John Taylor, R.Ph., qualified and accepted without objection as an expert in pharmacy, pharmacy law and the pharmacy policy of the Department of Health; and offered in evidence without objection 11 exhibits (R-1 through R-11).
The parties were given 15 days from the date of the filing of the transcript to file proposed final orders. The Transcript was filed on July 16, 2002. Petitioners' ore tenus motion, made at the conclusion of the final hearing, for an extension of time to file proposed final orders was denied.
On July 29, 2002, Petitioners' counsel filed a written Motion for Extension of Time to file a proposed final order. On July 30, 2002, an ex-parte letter from one J. Cox was filed regarding Petitioners' counsel's Motion for Extension of Time.
On July 31, 2002, an Order denying Petitioners' counsel's Motion for Extension of Time to file a proposed final order was entered. Petitioners' counsel did not file a proposed final order. Respondent filed a Proposed Final Order on July 31, 2002, that has been considered. On August 22, 2002, after conclusion of the final hearing and beyond the time established for submission of proposed final orders had expired, Petitioners' counsel filed an untimely Motion to Strike
Respondent's Proposed Final Order, that motion was, therefore, not considered in this Final Order.
Respondent is the state agency charged with regulating the practice of pharmacy pursuant to Section 20.43, Florida Statutes, Chapter 456 (formerly 455), Florida Statutes, and Chapter 465, Florida Statutes.
Prior to July 1, 2002, the Department of Health, pursuant to the authority of Section 20.43, Florida Statutes, contracted with the Agency for Health Care Administration (hereinafter "AHCA") to provide consumer complaint, investigative, and prosecutorial services required by the Division of Medical Quality Assurance, councils, or boards, as appropriate.
Petitioner, Albert F. Williams (hereinafter "Williams"), is, and has been at all times material hereto, a licensed pharmacist in the State of Florida, having been issued license number PS 0008425.
Petitioner, Stitch Enterprises, d/b/a Skycrest Pharmacy (hereinafter "Skycrest"), is, and has been at all times material hereto, a licensed pharmacy in the State of Florida, having been issued license number PH 0012143. Before the initial final hearing, Skycrest was administratively dissolved by the Florida Secretary of State.
On March 31, 1998, Respondent received a complaint from AHCA investigator William H. Herbert, Investigation Specialist II (hereinafter "Herbert"), alleging that a March 26, 1998, pharmacy inspection of Skycrest by Herbert, revealed that Williams and Skycrest were in violation of multiple pharmacy regulations.
Pursuant to Subsection 455.621(1), Florida Statutes, Respondent conducted an investigation into the alleged conduct of Williams and Skycrest.
On April 10, 1998, as a part of the investigation, Herbert notified Williams and Skycrest of the investigation. Herbert's letters, written on AHCA letterhead, one addressed to Williams and the other letter addressed to Skycrest in care of Williams, invited Williams and Skycrest to submit separate written responses to the pending investigations.
On May 8, 1998, Williams and Skycrest both filed three- page responses to the pending investigations with AHCA. Both responses were written and signed by B. Edwin Johnson, Esquire (hereinafter "Johnson"), the attorney for both Williams and Skycrest.
During the investigations, Herbert took pictures of various medications that were misbranded or repackaged and took possession of various medications indicated on the survey forms that were completed and filed.
During the investigations, Herbert spoke at length with Johnson regarding the violations that were discovered at the time of the inspection of Skycrest.
On July 31, 1998, Respondent's investigations of Williams and Skycrest were completed. The completed investigative reports regarding Williams and Skycrest were forwarded to Respondent's legal department and received on August 3, 1998.
The AHCA attorney, after reviewing Herbert's entire investigative reports and files, drafted two proposed administrative complaints and made recommendations to the Probable Cause Panel for their consideration.
Copies of the entire investigative file, including the proposed administrative complaints, were made available for each member of the Probable Cause Panel.
Respondent called John Taylor, R.Ph., as an expert in pharmacy law, and he testified that based on the information available to the Probable Cause Panel, there was sufficient evidence to establish that Williams and Skycrest had both violated the provisions cited in the Administrative Complaints filed by Respondent. Mr. Taylor's testimony was uncontested by Williams.
On April 15, 1999, Respondent presented the investigative reports and files to the Probable Cause Panel and
recommended that probable cause existed that Williams and Skycrest violated multiple provisions of Chapter 465, Florida Statutes (the Pharmacy Act).
On April 15, 1999, after review of the entire investigative files, discussions with staff counsel and discussions with the Department of Health's expert in pharmacy law, amendments to the proposed administrative complaints were suggested by the Probable Cause Panel, and they subsequently found probable cause that:
Williams had violated Section 465.016(1)(e), Florida Statutes, by violating 465.018, Florida Statutes, by violating Section 499.005(1), Florida Statutes, by repackaging, holding or offering for sale any drug, device or cosmetic that is adulterated or misbranded or has otherwise been rendered unfit for human or animal use.
and
Skycrest had violated Section 465.023(1)(c), Florida Statutes, by violating Section 499.005(1)(c), Florida Statutes, by repackaging, holding or offering for sale any drug, device or cosmetic that is adulterated or misbranded or has otherwise been rendered unfit for human or animal use.
The Probable Cause Panel directed the Agency to file an Administrative Complaint against Williams and file an Administrative Complaint against Skycrest.
The findings of the Probable Cause Panel were confirmed in writing by the chairperson of the Probable Cause Panel.
On June 23, 1999, pursuant to the Probable Cause Panel's findings of probable cause, Administrative Complaints (DOAH Case Nos. 00-0220 and 00-0315) were filed against Williams and Skycrest. Both Williams and Skycrest requested formal hearings before the Division of Administrative Hearings.
On November 17, 2000, a formal hearing on DOAH Case Nos. 02-0220 and 02-0315 was held in Clearwater, Florida, before the undersigned.
At the November 17, 2000, final hearing, Skycrest stipulated it would, within 30 days, voluntarily relinquish and surrender its license. Respondent accepted Skycrest's stipulation and in return agreed to not prosecute charges against Skycrest, but to prosecute charges only against Williams. The undersigned accepted the stipulation of the parties, and the parties are bound thereby in the case at bar. Skycrest, by virtue of this stipulation and Respondent's subsequent dismissal of the Administrative Complaint against Skycrest, was not a prevailing small business party as defined by statute in that proceeding.
On August 17, 2001, counsel for Williams and Skycrest filed the Application for an Award of Attorney's Fees and Costs
and the Affidavit as to Reasonable and Necessary Attorney Fees pursuant to Section 57.111, Florida Statutes, now at bar.
At the hearing on the case at bar, counsel for Williams and Skycrest elected not to present testimony nor evidence when given the opportunity to establish entitlement to attorney's fees and costs. Counsel elected to rely exclusively on the documents filed: (1) Affidavit as to Reasonable and Necessary Attorney's Fees and (2) the Application for an Award of Attorney's Fees and Costs, reserving the right to call rebuttal witnesses after the presentation of evidence by Respondent.
Respondent defended the Probable Cause Panel's action of finding probable cause and filing the Administrative Complaints against Williams and Skycrest as substantially justified. Respondent presented testimony of two witnesses, both of whom addressed the process undertaken by the Probable Cause Panel that concluded in findings of probable cause against both Williams and Skycrest.
At the conclusion of Respondent's substantial justification defense, counsel for Williams and Skycrest called a Stetson University law professor as Petitioners' rebuttal witness. When requested to provide a proffer of the rebuttal testimony, counsel stated that the witness would testify regarding corporate law in Florida, its application to the
administratively dissolved Skycrest Pharmacy, and Williams' use of Skycrest pharmacy as a "small business." Respondent objected to Williams' rebuttal witness' proffered testimony as beyond the scope of Respondent's defense of "substantial justification" for the Probable Cause Panel's filing of the Administrative Complaints.
After hearing arguments of counsel and considering the parties' binding stipulation that Skycrest was administratively resolved and would voluntarily surrender its license in return for Respondent's not prosecuting the charges against Skycrest, Respondent's objection to the proffered rebuttal testimony was granted. Counsel for Williams and Skycrest was afforded an opportunity to place the proffered testimony on the record for appellate purposes after the close of this hearing, but chose not to do so.
Counsel for Williams and Skycrest, introduced no evidence in support of his Application for an Award of Attorney's Fees and Costs and has accordingly not met its burden of proof demonstrating entitlement to an award of attorney's fees and costs pursuant to Section 57.111, Florida Statutes.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the subject matter and over the parties pursuant to Subsection 120.57(1), Florida Statutes.
Williams and Skycrest filed an application with the Division of Administrative Hearings for an award of attorney's fees and costs pursuant to Section 57.111, Florida Statutes. As the applicant, the burden rests on Petitioner to demonstrate, by a preponderance of the evidence, entitlement to the requested award. Department of Transportation v. J.W.C. Co., Inc., 396 So. 2d 778 (Fla. 1st DCA 1981), and Balino v. Department of Health and Rehabilitative Services, 348 So. 2d 349, 350 (Fla. 1st DCA 1977) ("[T]he burden of proof, apart from statute, is on the party asserting the affirmative issue before an administrative tribunal.").
Pertinent to this case, the Florida Equal Access to Justice Act (hereinafter the "Act"), Subsection 57.111(4)(a), Florida Statutes, provides:
(4)(a) Unless otherwise provided by law, an award of attorney's fees and costs shall be made to a prevailing small business party in any adjudicatory proceeding or administrative proceeding pursuant to Chapter 120 initiated by a state agency, unless the actions of the state agency were substantially justified or special circumstances exist which would make the award unjust.
By its response to the Application for an Award of Attorney's Fees and Costs, Respondent agreed that the underlying action was initiated by Respondent and agreed that Williams prevailed in the underlying proceeding (Case No. 00-0315), and
that the claim for attorney's fees and costs was timely filed pursuant to Subsection 57.111(4), Florida Statutes, and Department of Insurance and Treasurer v. Administrators Corp., 603 So. 2d 1359 (Fla. 1st DCA 1992).
However, Respondent disputed Williams' status as a "small business party," as defined by Subsection 57.111(3)(d), Florida Statutes, and, therefore, Williams' status as a "prevailing small business party," and contended that, when the underlying proceeding was initiated, the actions were "substantially justified."
As noted hereinabove, at the time the initial proceeding (Case No. 00-0315) was commenced against him, Williams practiced pharmacy through a professional service corporation and was not, therefore, shown to be a sole proprietor of an unincorporated business. Skycrest, as a corporation, possessed a separate pharmacy license from the pharmacy license possessed by Williams. Consequently, Williams was not a "small business party," as defined by Subsection 57.111(3)(d)1.a, Florida Statutes. See Florida Real Estate Commission v. Shealy, 647 So. 2d 151 (Fla. 1st DCA 1994). Florida Birth-Related Neurological Injury Compensation Ass'n v. McKaughan, 668 So. 2d 974, 979 (Fla. 1996) ("[B]ecause the [NICA] Plan . . . is a statutory substitute for common law rights and liabilities, it should be strictly construed to
include only those subjects clearly embraced within its terms."). See also Rivera v. Deauville Hotel v. Employers'
Service Corp., 277 So. 2d 265 (Fla. 1973) (An award of attorney fees to any litigant is in derogation of common law and is allowed only when provided for by contract or statute.); Hooper v. State Road Department, 105 So. 2d 515, 516 (Fla. 2d DCA 1958) ("[I]t is a cardinal rule of statutory construction that the plain meaning of a statute will not be disturbed in the absence of ambiguity of conflict."); and Devin v. City of Hollywood, 351 So. 2d 1022 (Fla. 4th DCA 1976). Finally, were an ambiguity or conflict to exist, it is a general principle of statutory construction that the mention of one thing implies the exclusion of another.
Therefore, where, as here, a statute enumerates who may file a claim, it would ordinarily be construed as excluding from its operation all those not expressly mentioned. Given the circumstances of the case at bar, Williams has failed to introduce evidence to demonstrate entitlement to attorney's fees and costs under Section 57.111, Florida Statutes, as the prevailing small business party.
Skycrest was not a prevailing party. Although Respondent had dismissed the Administrative Complaint against Skycrest, the dismissal was based on the stipulation of the
parties that Skycrest would relinquish its license if the Administrative Complaint was dismissed.
Assuming Williams and Skycrest had introduced evidence in this record to establish that they were prevailing small business parties, an entitlement to attorney's fees and costs would only be just and appropriate if it was also determined as fact that the Probable Cause Panel was not substantially justified in voting to file Administrative Complaints against Skycrest and Williams.
Subsection 57.111(4)(a), provides:
Unless otherwise provided by law, an award of attorney's fees and costs shall be made to a prevailing small business party in any adjudicatory proceeding or administrative proceeding pursuant to chapter 120 initiated by a state agency, unless the actions of the agency were substantially justified or special circumstances exist, which would make the award unjust.
It is well established that the Act is generally modeled after its federal counterpart, the Equal Access to Justice Act, 5 U.S.C. 504. The Act will, therefore, be given the same construction in the Florida courts as it has been given in the federal courts to the extent that the construction is consistent with the spirit and policy of Florida legislation on the same subject. Department of Professional Regulations,
Division of Real Estate v. Toledo Realty, Inc., et al., 549 So. 2d 715 (Fla. 1st DCA 1989) and Gentele v. Department of
Professional Regulation, Board of Optometry, 513 So. 2d 672 (Fla. 1st DCA 1987). The substantially justified test of governmental actions is that of reasonableness: that is if there was a reasonable basis in law and fact to support the probable cause finding at the time it was made, the action is substantially justified. The Probable Cause Panel need only have some evidence considered by the panel that would reasonably indicate that the violation alleged had indeed occurred. Kibler v. Department of Professional Regulations, 418 So. 2d 1081, 1084 (Fla. 4th DCA 1982). See also Tem Tech Industries, Inc. v.
N.L.R.B., 756 F.2d 586 (7th Cir. 1985); and Natchez Coca-Cola Bottling Co. v. N.L.R.B., 750 F.2d 1350 (5th Cir. 1985).
In Department of Health & Rehabilitative Services v.
S.G., 613 So. 2d 1380 (Fla. 1st DCA 1993), relying on McDonald
v. Schweiker, 726 F.2d 311 (7th Cir. 1983), the court found that "nonfrivolous" may not be equated with "substantial justification" for purposes of an award of fees under the Florida Equal Access to Justice Act. Instead, "substantial justification" was defined as meaning "the government must have a solid though not necessarily correct basis in law and fact for the position it took in the action." S.G. at 1386. In S.G., fees were awarded pursuant to Section 57.111, Florida Statutes, because the facts showed "a totally irresponsible investigation of the charges on the department's part, in spite of the fact
that HRS possessed knowledge that there may have been a misunderstanding between appellee and [complainant]." Id. at 1387. In the case at bar, the investigation conducted was not irresponsible, and Respondent did not have any knowledge that would compromise the investigative report.
So long as the evidence before the Probable Cause Panel constituted substantial justification, the final outcome of the case after probable cause is found is not the relevant consideration. Agency for Health Care Administration v. Gonzales, 657 So. 2d 56 (Fla. 1st DCA 1995). "The Act is designed to discourage unreasonable governmental action, not to paralyze agencies doing the necessary and beneficial work of government." Rudloe v. Department of Environmental Regulation,
33 Fla. Supp. 2d 203; and Department of Health and
Rehabilitative Services v. South Beach Pharmacy, Inc., 635 So. 2d 117, 121 (Fla. 1st DCA 1994).
In the case at bar, the Probable Cause Panel had evidence before it consisting of the investigative file compiled by AHCA including the survey worksheet completed by investigator Herbert, copies of the medications taken into possession by Herbert, and the written responses of Williams and Skycrest.
Respondent called John Taylor, R.Ph., as an expert in pharmacy law, and he testified that based on the information available to the Probable Cause Panel, there was sufficient
evidence to establish that Williams and Skycrest had both violated the provisions cited in the Administrative Complaints filed by Respondent. Mr. Taylor's testimony was uncontested.
When Williams' attorney announced that he would rest his case for entitlement to attorney's fees and costs on the pleadings filed, Respondent made a motion to dismiss Williams' request because Williams offered no evidence in support of the claim that Williams met the definition of a "small business party." Respondent also moved to strike Williams' pleadings and for a summary final order. Both motions of Respondent were denied, and Respondent presented its "substantial justification" evidence.
Petitioners have failed to establish that Williams was a prevailing small business party and failed to establish that Skycrest was a prevailing small business party in the initial administrative proceeding.
By uncontested evidence, Respondent established that the Probable Cause Panel was substantially justified in finding probable cause and authorizing the filings of Administrative Complaints against the licenses of Petitioners, Albert F. Williams and Stitch Enterprises, d/b/a Skycrest Pharmacy.
Based on the foregoing Findings of Fact and Conclusions of Law, the applications for attorney's fees and costs pursuant to Section 57.111, Florida Statutes, filed by Petitioners,
Albert F. Williams and Stitch Enterprises, d/b/a Skycrest Pharmacy, are DENIED.
DONE AND ORDERED this 12th day of September, 2002, in Tallahassee, Leon County, Florida.
FRED L. BUCKINE
Filed with the Clerk of the Division of Administrative Hearings this 12th day of September, 2002.
1/ Pleadings filed for Application for an Award of Attorney's Fees and Costs and Affidavit as to Reasonable and Necessary Attorney's Fees relates to time and costs incurred in the defense of DOAH Case Nos. 00-0220 and 02-0315 filed on
August 17, 2002.
Reginald D. Dixon, Esquire Department of Health
B. Edwin Johnson, Esquire
John Taylor, R. Ph., Executive Director Board of Pharmacy
R. S. Power, Agency Clerk Department of Health
William W. Large, General Counsel Department of Health
A party who is adversely affected by this Final Order is entitled to judicial review pursuant to Section 120.68, Florida Statutes. Review proceedings are governed by the Florida Rules of Appellate Procedure. Such proceedings are commenced by filing the original notice of appeal with the Clerk of the Division of Administrative Hearings and a copy, accompanied by filing fees prescribed by law, with the District Court of Appeal, First District, or with the District Court of Appeal in the Appellate District where the party resides. The notice of appeal must be filed within 30 days of rendition of the order to be reviewed.
