Notice2023-11131
Keith Ly, M.D.; Decision and Order
Primary source
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Published
May 25, 2023
Issuing agencies
Justice DepartmentDrug Enforcement Administration
Full Text
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<title>Federal Register, Volume 88 Issue 101 (Thursday, May 25, 2023)</title>
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[Federal Register Volume 88, Number 101 (Thursday, May 25, 2023)]
[Notices]
[Pages 33908-33910]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-11131]
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DEPARTMENT OF JUSTICE
Drug Enforcement Administration
[Docket No. 22-26]
Keith Ly, M.D.; Decision and Order
I. Introduction
On April 28, 2022, the Drug Enforcement Administration (DEA or
Government) issued an Order to Show Cause (OSC) to Keith Ly, M.D.
(Applicant), of Houston, Texas.\1\ OSC, at 1, 4. The OSC proposes the
denial of Applicant's application for a DEA Registration (Control No.
W21134341C), pursuant to 21 U.S.C. 824(a)(2 and 4) and 823(g)(1). Id.
at 1. The OSC more specifically alleges that Applicant is a convicted
felon, due to his violations of federal controlled substance laws, and
committed other acts rendering his registration inconsistent with the
public interest.\2\ Id.
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\1\ Also referred to as ``Keith Ly, D.O.'' Compare Order
Rejecting Applicant's Subpoena Request, at 1, with Recommended
Rulings, Findings of Fact, Conclusions of Law and Decision of the
Administrative Law Judge (RD), at 1.
Effective December 2, 2022, the Medical Marijuana and
Cannabidiol Research Expansion Act, Public Law 117-215, 136 Stat.
2257 (2022) (MRA), amended the Controlled Substances Act (CSA) and
other statutes. Relevant to this matter, the MRA redesignated 21
U.S.C. 823(f), cited in the OSC, as 21 U.S.C. 823(g)(1).
Accordingly, this Decision cites to the current designation, 21
U.S.C. 823(g)(1), and to the MRA-amended CSA throughout.
\2\ During the hearing, without Applicant's objection, the
Government corrected two, legally irrelevant errors in the OSC. Tr.
65, 69. Applicant did not file Exceptions about and, therefore, the
Agency does not address, any of the Administrative Law Judge's pre-
hearing, hearing, or post-hearing rulings.
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The hearing Applicant requested was held on September 8, 2022.
Transcript of Video-Teleconference. Referencing Applicant's prior seven
felony convictions and his failure to accept unequivocal responsibility
for his actions, the RD recommends that Applicant's application be
denied. RD, at 19-21, 23. Given the seriousness and extent of
Applicant's founded violations, infra sections II.C., II.D., III.B.,
III.C., and IV., the Agency agrees.
Having thoroughly analyzed the record and applicable law, the
Agency summarizes its findings and conclusions: (1) the Government
presented a prima facie case that Applicant is a felon convicted of
seven violations of federal law relating to a controlled substance and
that Applicant wrote prescriptions for controlled substances when he
was not legally authorized to do so, (2) Applicant attempted, but
failed, to rebut the Government's prima facie case, and (3) substantial
record evidence shows that the extent of Applicant's legal violations
calls for the denial of his application for a DEA registration.
Accordingly, the Agency will deny Applicant's registration application.
Infra Order.
II. Findings of Fact
A. The Government's Case
The Agency finds that the parties stipulated to Applicant's seven
felony convictions.\3\ Joint Stipulation No. 2 (set out in Prehearing
Ruling, at 2); see also GX 3 (Amended Judgment in a Criminal Case:
United States v. Keith Ly, 2:13CR00157MJP-002), at 1-2. The Agency
finds that Applicant did not object to the introduction of GX 3, and
does not dispute that he was sentenced to prison for sixty months. Tr.
28-29; GX 3, at 3; see also, e.g., Tr. 150-51; Applicant's Closing
Argument, at 1. Accordingly, the Agency finds uncontroverted,
substantial record evidence that Applicant has seven prior felony
convictions under federal law.
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\3\ ``On December 19, 2014, Applicant was convicted of seven
felonies under Title 21 in the United States District Court for the
Western District of Washington, in Case No. 13-CR-157. Specifically,
Applicant was convicted of the following: a. Count One, Conspiracy
to Distribute and Dispense a Schedule I Controlled Substance, in
violation of 21 U.S.C. 841 and 846; b. Counts Two-Four,
Manufacturing Marijuana a Schedule 1 Controlled Substance, in
violation of 21 U.S.C. 841; and c. Counts Five-Seven, Maintaining a
Drug Involved Premises, in violation of 21 U.S.C. 856.'' Joint
Stipulation No. 2 (set out in Prehearing Ruling, at 2).
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Regarding the allegation of unlawful controlled substance
prescribing, the Government successfully moved into evidence the
Agency's prior Decision/Order concerning Applicant. GX 6 (Keith Ky Ly,
D.O., 80 FR 29025 (May 20, 2015)). Accordingly, there is substantial
record evidence that the Agency immediately suspended Applicant's prior
DEA registration and affirmed that suspension in a published final
Decision/Order dated May 20, 2015. Further, there is substantial record
evidence that Applicant had reason to be aware of that immediate
suspension on January 28, 2013. GX 6, at 3; see also Tr. 54-55, 61.
The Government successfully moved into evidence four controlled
substance prescriptions. GX 5a-d (lorazepam, OxyContin, clonazepam, and
phenobarbital).\4\ The Diversion Investigator (DI) who testified that
he obtained these prescriptions also testified that he confirmed with
pharmacies that they dispensed, and with Applicant's patients that they
received, the controlled substances issued in GX 5a-d.\5\ Tr. 56-70.
Accordingly, the Agency finds substantial record evidence that
Applicant issued controlled substance prescriptions between February 1,
2013 and March 12, 2014, when his DEA registration was suspended.
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\4\ In addition to containing controlled substance
prescriptions, GX 5a-d also includes prescriptions for items that
are not controlled.
\5\ The Agency agrees with the RD's decision to afford DI's
testimony ``full credibility.'' RD, at 6.
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B. Applicant's Case
As already discussed, Applicant admits that he is a felon. Supra
section II.A. He argues, though, that the convictions are ``totally
unrelated to any conduct in his medical practice. It was for marijuana
and not a prescribed drug, nor one that is presently illegal in most
states.'' Applicant Exceptions, at 1. Applicant also argues that the
convictions stem ``from actions that took place almost a decade ago,''
and that nobody has ever alleged that his controlled substance
prescribing reflected an ``inappropriate medical diagnosis, practice or
procedure.'' \6\ Id. at 2. He posits that the RD reflects a prejudging
of his case ``due to a conviction . . . totally unrelated'' to his
registration application. Id. at 2. Applicant similarly argues that the
RD shows a ``misinterpret[ation]'' of his approach to acceptance of
responsibility, as it fails to ``distinguish between a person who
explains what took place,'' as he claims to have done, ``as opposed to
someone who seeks to offer an excuse for what took place.'' Id.
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\6\ Applicant also asserts that the notion that past performance
is the best indicator of future results is ``archaic reasoning''
that ``flies in the face of countless examples of rehabilitation,
restitution and recovery.'' Applicant Exceptions, at 1.
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Regarding the allegation that he prescribed controlled substances
when he did not have legal authority to do so, Applicant argues that GX
5a-d includes prescriptions that are not for controlled substances,
that some of the alleged prescriptions are not ``prescriptions''
because they do not include all of the elements required by regulation,
and that the signature on the alleged controlled substance
prescriptions is not his. Tr. 172-176; 186-192; 198-206; see also,
e.g., Applicant's Closing Argument at 5. He also argues that the
``prescriptions'' do not evidence or ``constitute any substandard
medical procedures or diagnosis.'' Applicant Exceptions, at 2;
Applicant's Closing Argument, at 4, 5. Instead, Applicant states that,
throughout his practice, he has ``provide[d] medical[ly] necessary
assistance with prescribed, controlled substances when the patient's
condition(s) suggest that such a
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treatment would be in the patient's best interest.'' Id.
Applicant's case highlights the continuing medical education (CME)
classes he took while incarcerated and the Texas Medical Board's re-
issuance of his medical license. Id. at 2.
The Agency agrees with the RD's analysis of, and conclusions about,
the credibility of Applicant's testimony. RD, at 8-9. Accordingly, in
this adjudication, the Agency gives DI's testimony controlling weight
when there is a conflict between it and Applicant's testimony, and
gives Applicant's testimony little to no weight in all other
circumstances. Id. at 9.
C. Allegation That Applicant Is a Convicted Felon
Based on a review of all of the record evidence, the Agency notes
Applicant's admission that he has been convicted of seven felonies.
Supra section II.A.; n.3. Accordingly, the Agency finds substantial,
uncontroverted record evidence that Applicant is a seven-time convicted
felon.
D. Allegation That Applicant Issued Controlled Substance Prescriptions
When His DEA Registration Was Suspended
Based on a review of all of the record evidence, and application of
its credibility assessments, the Agency rejects the arguments of
Applicant about the content of GX 5a-d that conflict with DI's
testimony.\7\ Applicant's argument that GX 5a-d's controlled substance
prescriptions are not valid, because they do not include the elements
required by federal regulation, lacks merit against DI's credible
testimony that a pharmacy filled them and dispensed controlled
substances to Applicant's patients.\8\ See RD, at 14-15. Accordingly,
the Agency finds substantial record evidence that Applicant issued
controlled substance prescriptions when his DEA registration was
suspended.
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\7\ Applicant's argument that the contents of GX 5a-d include
prescriptions for non-controlled substances is not germane because
GX 5a-d also contain prescriptions for controlled substances. See
n.4, supra. The latter are material to the evaluation of
Respondent's application, the former are not.
\8\ Applicant's argument that the signatures on those controlled
substance prescriptions do not belong to him is not credible for the
same reasons.
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III. Discussion
A. The Controlled Substances Act (CSA) and Implementing Regulations
According to the CSA, a practitioner's application for a DEA
registration may be denied upon a determination that ``the issuance of
such registration . . . would be inconsistent with the public
interest.'' 21 U.S.C. 823(g)(1). In making the public interest
determination, the CSA requires consideration of five factors. 21
U.S.C. 823(g)(1)(A-E). The five factors are considered in the
disjunctive. Robert A. Leslie, M.D., 68 FR 15227, 15230 (2003).
According to Agency decisions, the Agency ``may rely on any one or
a combination of factors and may give each factor the weight [it] deems
appropriate in determining whether'' to revoke a registration. Id.; see
also Jones Total Health Care Pharmacy, LLC v. Drug Enf't Admin., 881
F.3d 823, 830 (11th Cir. 2018) (citing Akhtar-Zaidi v. Drug Enf't
Admin., 841 F.3d 707, 711 (6th Cir. 2016)); MacKay v. Drug Enf't
Admin., 664 F.3d 808, 816 (10th Cir. 2011); Volkman v. U.S. Drug Enf't
Admin., 567 F.3d 215, 222 (6th Cir. 2009); Hoxie v. Drug Enf't Admin.,
419 F.3d 477, 482 (6th Cir. 2005). Moreover, while the Agency is
required to consider each of the factors, it ``need not make explicit
findings as to each one.'' MacKay, 664 F.3d at 816 (quoting Volkman,
567 F.3d at 222); see also Hoxie, 419 F.3d at 482. ``In short, . . .
the Agency is not required to mechanically count up the factors and
determine how many favor the Government and how many favor the
registrant. Rather, it is an inquiry which focuses on protecting the
public interest; what matters is the seriousness of the registrant's
misconduct.'' Jayam Krishna-Iyer, M.D., 74 FR 459, 462 (2009).
Accordingly, as the Tenth Circuit has recognized, findings under a
single factor can support the revocation of a registration. MacKay, 664
F.3d at 821. In this matter, while all of the 21 U.S.C. 823(g)(1)
factors have been considered, the Government's evidence is confined to
Factors B, C, and D.\9\ OSC, at 1-2.
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\9\ Neither Applicant nor the Government purports to offer
evidence relevant to Factors A or E. The Agency considered Factors A
and E, and finds that neither of them is relevant to this
adjudication.
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B. Factor ``C''--Applicant's Conviction Record Under Federal Laws
Relating to the Manufacture, Distribution, or Dispensing of Controlled
Substances
As already discussed, the record, including Applicant's admissions,
contains substantial evidence that Applicant has been convicted of
seven felonies. Supra sections II.A. and II.C.; n.3. It is self-evident
that each of these seven felonies involves a controlled substance and
relates to the ``manufacture, distribution, or dispensing'' of a
controlled substance. n.3; 21 U.S.C. 823(g)(1)(C). Accordingly, the
Agency finds substantial record evidence that Applicant was convicted
of seven felonies ``relating to the manufacture, distribution, or
dispensing of controlled substances,'' that the Government presented a
prima facie case under Factor C, that Applicant failed to rebut the
Government's prima facie case, and that Applicant's continued
registration is inconsistent with the public interest, supporting
denial of his registration application. Id.
C. Factors B and D--Applicant's Experience Dispensing Controlled
Substances and Compliance With Applicable Laws Relating to Controlled
Substances
As already discussed, the Agency finds substantial record evidence
that Applicant issued controlled substance prescriptions when his DEA
registration was suspended. Supra section II.D; see also section II.A.
Under the CSA, a practitioner must possess a DEA registration to
dispense a controlled substance lawfully. See, e.g., 21 U.S.C.
823(g)(1). Accordingly, the Agency finds substantial record evidence of
Applicant's unlawful controlled substance dispensing and failure to
comply with federal law relating to controlled substances, that the
Government presented a prima facie case under Factors B and D, that
Applicant failed to rebut the Government's prima facie case, and that
Applicant's continued registration is inconsistent with the public
interest, supporting denial of his registration application. Id.; see
also RD, at 14 (first full paragraph) through 17 (the penultimate
sentence of the first full paragraph).
IV. Sanction
Where, as here, the Government has met its prima facie burden of
showing that Applicant's continued registration is inconsistent with
the public interest, the burden shifts to Applicant to show why he can
be entrusted with a registration. Garrett Howard Smith, M.D., 83 FR
18882 (2018). Moreover, as past performance is the best predictor of
future performance, the Agency has required that an applicant who has
committed acts inconsistent with the public interest must unequivocally
accept responsibility for those acts and demonstrate that he will not
engage in future misconduct. Id. In addition, an applicant's candor
during the investigation and hearing has been an important factor in
determining acceptance of responsibility and the appropriate sanction.
Id. In addition, the Agency has found that the egregiousness and extent
of the misconduct are
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significant factors in determining the appropriate sanction. Id. The
Agency has also considered the need to deter similar acts by an
applicant and by the community of registrants. Id.
Applicant posits that the RD ``prejudge[s]'' him and
``misinterprets'' his approach by not ``distinguish[ing] between a
person who explains what took place,'' as he argues he did, ``as
opposed to someone who seeks to offer an excuse for what took place.''
Applicant Exceptions, at 2; supra section II.B. Applicant also argues
that he stated, ``truthfully,'' ``how the grow houses became used for
marijuana'' and ``admit[ted] his responsibility in same.'' Applicant
Exceptions, at 2. Citing his ``remarkable'' CME compliance and re-
issued Texas medical license, Applicant also claims that he ``has
demonstrated, through his actions since, that he is worthy of any
discretion the Court could provide.'' Id.; but see RD, at 19.
Even if the Agency were to credit Applicant's arguments, they do
not change the fact that he did not unequivocally accept responsibility
for the founded violations. Supra sections III.B. and III.C. For
example, regarding the allegation that he prescribed controlled
substances after the 2013 suspension of his registration, Applicant
even refused to admit that the signatures on the controlled substance
orders were his. Supra section II.B. The RD credits the DI's testimony
over Applicant's steadfast refusal to acknowledge his signatures, and
the Agency agrees. RD, at 14-15; see also supra sections II.A., II.B.,
and II.D.
This record evidence also shows that Applicant, despite his
``remarkable'' CME compliance, does not understand the responsibilities
the CSA places on practitioners. Applicant posits that, ``throughout
his practice, he has provide[d] medical[ly] necessary assistance with
prescribed, controlled substances when the patient's condition(s)
suggest that such a treatment would be in the patient's best
interest.'' Applicant's Closing Argument, at 2; see also Applicant
Exceptions, at 2-4. Such statements attempt to minimize, or divert
attention from, his unlawful activity, and show Applicant's lack of
understanding of the CSA's requirements. Accordingly, the Agency finds
that Applicant did not unequivocally accept responsibility for the
unlawful acts he committed and has not convinced the Agency that he can
be entrusted with a registration.\10\
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\10\ Remedial measures are insufficient without an unequivocal
acceptance of responsibility. Brenton D. Wynn, M.D., 87 FR 24228,
24261 (2022); see also Michael T. Harris, M.D., 87 FR 30276, 30278
(2022) (collecting Agency decisions).
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The interests of specific and general deterrence weigh in favor of
denying Applicant's registration application. See, e.g., Garrett Howard
Smith, M.D., 83 FR at 18910 (collecting cases) (``The egregiousness and
extent of the misconduct are significant factors in determining the
appropriate sanction.''). Given the seriousness and extent of
Applicant's founded violations, a sanction less than application denial
would tell prospective registrants that compliance with the law is not
a condition precedent to the issuance of a registration.
Accordingly, the Agency shall order the sanction the Government
requested.
Order
Pursuant to 28 CFR 0.100(b) and the authority vested in me by 21
U.S.C. 823(g)(1), I hereby deny the DEA registration application of
Keith Ly, M.D. (Control No. W21134341C). Further, pursuant to 28 CFR
0.100(b) and the authority vested in me by 21 U.S.C. 823(g)(1), I
hereby deny any pending application of Keith Ly, M.D., for a DEA
Registration in Texas. This Order is effective June 26, 2023.
Signing Authority
This document of the Drug Enforcement Administration was signed on
May 16, 2023, by Administrator Anne Milgram. That document with the
original signature and date is maintained by DEA. For administrative
purposes only, and in compliance with requirements of the Office of the
Federal Register, the undersigned DEA Federal Register Liaison Officer
has been authorized to sign and submit the document in electronic
format for publication, as an official document of DEA. This
administrative process in no way alters the legal effect of this
document upon publication in the Federal Register.
Heather Achbach,
Federal Register Liaison Officer, Drug Enforcement Administration.
[FR Doc. 2023-11131 Filed 5-24-23; 8:45 am]
BILLING CODE 4410-09-P
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</html>Indexed from Federal Register on May 25, 2023.
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