Notice2025-19577
Shannon Wagner, D.O.; Decision and Order
Primary source
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Published
October 17, 2025
Issuing agencies
Justice DepartmentDrug Enforcement Administration
Full Text
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<title>Federal Register, Volume 90 Issue 199 (Friday, October 17, 2025)</title>
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[Federal Register Volume 90, Number 199 (Friday, October 17, 2025)]
[Notices]
[Pages 48354-48357]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-19577]
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DEPARTMENT OF JUSTICE
Drug Enforcement Administration
[Docket No. 24-69]
Shannon Wagner, D.O.; Decision and Order
On August 13, 2024, the Drug Enforcement Administration (DEA or
Government) issued an Order to Show Cause (OSC) to Shannon Wagner,
D.O., of Green Bay, Wisconsin (Respondent). OSC, at 1, 3. The OSC
proposed the denial of Respondent's application for a DEA Certificate
of Registration (registration), Control No. W23130415C, 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 February 21, 2025, 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 granted. RD, at 20. The Government 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
[[Page 48355]]
of law, sanctions analysis, and recommended sanction in the RD, and
summarizes, and expands upon portions thereof herein.
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\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 3-19. The Agency agrees with the ALJ that the
DEA Diversion Investigator (DI) was a credible, knowledgeable
witness. Id. at 3. The testimony from the DI was primarily focused
on the introduction of the Government's documentary evidence. Id.
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I. Applicable Law
Pursuant to 21 U.S.C. 824(a)(5), the Attorney General is authorized
to suspend or revoke a registration upon finding that the registrant
``has been excluded (or directed to be excluded) from participation in
a program pursuant to section 1320a-7(a) of Title 42.'' The Agency has
consistently held that it may also deny an application upon finding
that an applicant has been excluded from a federal health care program.
See Arvinder Singh, M.D., 81 FR 8247, 8248 n.3 (2016) (`` `[W]here a
registration can be revoked under [21 U.S.C.] 824, it can, a fortiori,
be denied under [21 U.S.C.] 823 since the law would not require an
agency to indulge in the useless act of granting a license on one day
only to withdraw it on the next.' '' (quoting Kwan Bo Jin, M.D., 77 FR
35021, 35021 n.2 (2012)).
II. Findings of Fact
On August 21, 2014, in the United States District Court for the
Western District of Michigan, Respondent pleaded guilty to one count of
conspiracy to pay and receive health care kickbacks, in violation of 42
U.S.C. 1320a-7b(b) and 18 U.S.C. 371; and one count of filing a false
tax return, in violation of 26 U.S.C. 7206(1).\2\ RD, at 3; Government
Exhibit (GX) 3. On November 28, 2014, the U.S. Department of Health and
Human Services, Office of Inspector General (HHS/OIG), mandatorily
excluded Respondent from participation in Medicare, Medicaid, and all
federal health care programs pursuant to 42 U.S.C. 1320a-7(a) for a
period of thirteen years. RD, at 3; GX 7. The exclusion became
effective on December 18, 2014, and imposed an exclusion for a minimum
period of thirteen years.\3\ Id. Accordingly, the Agency finds
substantial record evidence that Respondent has been, and continues to
be, excluded from participation in federal health care programs.\4\
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\2\ Respondent has stipulated to this fact. See ALJ Exhibit 9,
at 2.
\3\ Respondent has stipulated to this fact. See ALJ Exhibit 9,
at 3.
\4\ Where Respondent has stipulated to a fact, the Agency
exceeds the substantial record evidence standard.
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III. Discussion
The Agency agrees with the ALJ and finds substantial record
evidence that Respondent has been, and remains, mandatorily excluded
from federal health care programs pursuant to 42 U.S.C. 1320a-7(a),\5\
and Respondent has admitted to the same. RD, at 3, 18; GX 7.
Accordingly, the Agency finds that substantial record evidence
establishes the Government's prima facie case for denying Respondent's
application under 21 U.S.C. 824(a)(5). See also 21 U.S.C. 823(g)(1).
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\5\ The underlying conviction forming the basis for mandatory
exclusion from participation in federal health care programs need
not involve controlled substances to provide the grounds for
revocation or denial pursuant to Section 824(a)(5). Jeffrey Stein,
M.D., 84 FR 46968, 46971-72 (2019); see also Narciso Reyes, M.D., 83
FR 61678, 61681 (2018); KK Pharmacy, 64 FR 49507, 49510 (1999)
(collecting cases).
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IV. Sanction
Where, as here, the Government has met its prima facie burden of
showing that Respondent's application for a registration should be
denied, the burden shifts to Respondent to show why she can be
entrusted with a registration. Morall v. Drug Enf't Admin., 412 F.3d.
165, 174 (D.C. Cir. 2005); Jones Total Health Care Pharmacy, LLC v.
Drug Enf't Admin., 881 F.3d 823, 830 (11th Cir. 2018); Garrett Howard
Smith, M.D., 83 FR 18882 (2018). The issue of trust is necessarily a
fact-dependent determination based on the circumstances presented by
the individual respondent. Jeffrey Stein, M.D., 84 FR 46968, 46972
(2019); see also Jones Total Health Care Pharmacy, 881 F.3d at 833.
Moreover, as past performance is the best predictor of future
performance, DEA Administrators have required that a respondent who has
committed acts inconsistent with the public interest must accept
responsibility for those acts and demonstrate that he or she will not
engage in future misconduct. Jones Total Health Care Pharmacy, 881 F.3d
at 833. A respondent's acceptance of responsibility must be
unequivocal. Id. at 830-31. In addition, a respondent's candor during
the investigation and hearing has been an important factor in
determining acceptance of responsibility and the appropriate sanction.
Id. Further, DEA Administrators have found that the egregiousness and
extent of the misconduct are significant factors in determining the
appropriate sanction. Id. at 834 & n.4. DEA Administrators have also
considered the need to deter similar acts by the respondent and by the
community of registrants. Jeffrey Stein, M.D., 84 FR at 46972-73.
Here, the Agency agrees with the ALJ that Respondent unequivocally
accepted responsibility for her conduct. Respondent acknowledged at
every opportunity that her conduct was wrong. RD, at 12. Respondent
testified directly and credibly that she had committed the charged
crimes and that, in doing so, she made a significant mistake that had
harmed her patients. Id. at 13. Respondent addressed, and accepted
responsibility, for all her misconduct, including the illegal kickback
conspiracy, the tax evasion, and her failure to take action to stop her
husband. Id. Respondent testified credibly that she had learned to
never allow anyone or anything to come between her and her patients.
Id. Respondent directly and unequivocally acknowledged her crimes and
her responsibility for her crimes during cross-examination and
questioning from the ALJ. Id. Respondent acknowledged her fault and
provided credible, persuasive clarifications as to other statements she
had made. Id.
Having found that Respondent has unequivocally accepted
responsibility for her conduct, the Agency considers whether Respondent
has implemented sufficient remedial measures to demonstrate that she
will not engage in future misconduct and can be trusted with a
registration.\6\ The Agency considers the fact that Respondent is no
longer married to her co-conspirator, a significant remedial
measure.\7\ Tr. 39. Since Respondent's conviction and loss of license,
Respondent has taken
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concrete steps to reestablish trust and rebuild her practice. RD, at
17.
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\6\ The Agency disagrees with the Government's exception that
the ALJ shifted the burden of proving unequivocal acceptance of
responsibility and the taking of remedial measures onto the
Government. Government Exceptions, at 2. Respondent had the burden
to establish, and indeed did establish, unequivocal acceptance of
responsibility and sufficient remedial measures; however, the
Government disagreed. The portion of the RD that the Government
calls burden shifting is actually the ALJ's assessment of the
Government's argument that Respondent did not meet her burden. The
Agency does not consider this shifting the burden of proof to the
Government.
\7\ Respondent testified that her husband at the time managed
the business. Tr. 38-39. Respondent admitted that she did not
oversee her husband's activities. Id. When she did try to oversee,
she was ``shut down'' and ``suffered'' if she interfered, as her
husband was both verbally and physically abusive. Tr. 40-41.
Moreover, if she attempted to supervise him, he would defy her and
do what she told him not to do. Tr. 41. Respondent admitted her
fault and that she should have had control of her own business. RD.
at 6. Respondent testified that the abuse she suffered did not
excuse her lack of oversight of the business because it was
ultimately her practice. Id. Respondent testified that it was all
her responsibility and that she should have interfered and stopped
him. Id.
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According to Respondent, her time in prison affected how she viewed
medicine and her own past actions. Tr. 46-48; RD, at 6. Respondent
testified that she saw multiple inmates receive inadequate medical care
for serious conditions, and she herself was refused treatment. Id.
Respondent testified that these experiences made her a better doctor
and made her think more about health care in general in that there are
segments of the population that are completely neglected. Id.
Respondent candidly and credibly testified that her time in prison
changed her and made her realize that medical care involved not just
treatment, but all administrative duties. RD, at 13.
After Respondent's release from prison in 2016, she did not
immediately return to the practice of medicine. RD, at 7. Respondent
worked a variety of jobs such as food delivery, waitressing, trucking,
and cleaning. Id.; Tr. 55-56. On multiple occasions, she had to wait on
former colleagues and other doctors that she knew. Id. Respondent
testified that working these positions humbled her and made her aware
of how valuable her license was and what an honor it was to have it.
Id. Respondent eventually secured a medical license in Wisconsin, for
which she disclosed her criminal convictions and exclusion from federal
health care programs. Tr. 56. To do so, she was required to work under
a limited license for a year, with quarterly reports from a supervisor
to the Wisconsin Medical Board. Id. After one year, she applied for and
received a full medical license in Wisconsin. Tr. 57. Respondent
obtained employment at a clinic in Wisconsin. Tr. 62-64. Respondent is
seeking a DEA registration because she plans to work with incarcerated
people and a DEA registration is required for a position within the
corrections system. RD, at 7. Respondent has also taken approximately
240 hours of continuing medical education credits.\8\ Tr. 61. Finally,
in terms of mitigation and remedial measures, Respondent has paid, and
continues to pay, the ordered restitution of $270,000.\9\ RD, at 17.
The Agency agrees with the ALJ that Respondent has taken ``significant,
concrete remedial steps'' to ensure the misconduct will not reoccur.
Id. at 18.
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\8\ The state of Wisconsin requires 30 hours of Continuing
Medical Education (CME) credits for physicians every two years. See
American Medical Association Ed Hub, Wisconsin State CME
Requirements, <a href="https://edhub.ama-assn.org/state-cme/Wisconsin">https://edhub.ama-assn.org/state-cme/Wisconsin</a>. Since
Respondent has gone over the minimum required hours of CME for
physicians, the Agency accepts this as a sufficient remedial measure
and rejects the Government's argument that Respondent needs to
explain the subject matter of the courses taken. Government
Exceptions, at 7-8.
\9\ The Agency also rejects the Government's argument that
Respondent has failed to show sufficient remedial measures by paying
$150 in restitution each month. Government Exceptions, at 6-7.
Respondent has consistently paid restitution since being released
from prison and continues to do so. RD, at 17. Respondent also
testified that she will pay more once she obtains a higher paying
job and intends to pay the amount in full. Tr. at 93.
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Regarding egregiousness, there is no dispute that the conduct that
led to Respondent's conviction and subsequent exclusion from all
federal health care programs was egregious. In a case brought under 21
U.S.C. 824(a)(5), the length of the exclusion, the nature of the
misconduct, and the period of incarceration are relevant considerations
in determining egregiousness. George Roussis, M.D., 86 FR 61316, 61322-
23 (2021) (citing Michael Jones, M.D., 86 FR 20728, 20732 (2021)). In
the instant case, Respondent has been excluded for 13 years, with that
exclusion ending in 2027. RD, at 18. As for the underlying conviction,
Respondent pleaded guilty to a seven-year conspiracy, to commit health
care fraud and filed a false tax return. Id. The egregious nature of
Respondent's lengthy exclusion from federal health care programs and
the egregious nature of the criminal conduct underlying the conviction
would typically weigh in favor of denial of her application. Id.
However, the conspiracy ended in April 2011, and the tax offense
occurred in March 2012. GX 3, at 3. Thus, Respondent's criminal conduct
ended over 13 years ago. RD, at 18, and Respondent has taken
significant remedial measures during that time. Id.
In addition to acceptance of responsibility, the Agency considers
both specific and general deterrence when determining an appropriate
sanction. Daniel A. Glick, D.D.S., 80 FR 74800, 74810 (2015). Because
these administrative proceedings are intended to be remedial, rather
than punitive, the Agency has previously found that, under appropriate
circumstances, ``criminal convictions and sanctions by state licensing
authorities can sufficiently deter physicians from engaging in
misconduct, making the denial of an application . . . unnecessary to
achieve the goal of general deterrence.'' Gilbert Y. Kim, D.D.S., 87 FR
21139, 21145 (2022) (citing Kansky J. Delisma, M.D., 85 FR 23845, 23854
(2020)). The Agency has also held that, sometimes, ``such punitive
measures can suffice to deter the registrant or applicant from future
misconduct, making revocation or denial of an application unnecessary
to achieve specific deterrence.'' Id.
Here, the Agency does not find that imposing further sanction is
necessary to deter Respondent from engaging in future misconduct.
Respondent received significant criminal punishment for her criminal
conduct. RD, at 19. Respondent's plea agreement imposed a significant
price for her crimes, 24 months of imprisonment, the forfeiture of
thirteen real properties and cash, and detailed obligations for
cooperation in her case. Id. Respondent served 17 months of her 24-
month prison sentence, successfully completed supervised release,
forfeited two clinics along with other properties, and continues to pay
restitution for her crimes of conviction. Thus, the Agency finds that
the punitive, remedial, and personal consequences that Respondent
suffered are sufficient to deter her from engaging in future
misconduct. The Agency also finds that the significant consequences
that Respondent has faced are sufficient to deter the general
registrant community from committing similar misconduct.
Ultimately, the determination of the appropriate sanction turns on
whether the Agency can trust Respondent with a registration and that
Respondent will not repeat her misconduct. See Heavenly Care Pharmacy,
85 FR 53402, 53420 (2020). Respondent testified candidly, unequivocally
accepted responsibility, and demonstrated genuine insight into the
nature and scope of her criminal misconduct. RD, at 19. In sum,
Respondent's candid, genuine testimony, coupled with her concrete
remedial actions, convince the Agency that she can be trusted with a
registration. Therefore, the Agency will grant her application.
Order
Pursuant to 28 CFR 0.100(b) and the authority vested in me by 21
U.S.C. 823 and 824, I hereby dismiss the Order to Show Cause issued to
Shannon Wagner, D.O., and grant the pending application for a DEA
Certificate of Registration, Control No. W23130415C, submitted by
Shannon Wagner, D.O. This Order is effective immediately.
Signing Authority
This document of the Drug Enforcement Administration was signed on
October 1, 2025, by Administrator Terrance Cole. 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
[[Page 48357]]
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. 2025-19577 Filed 10-16-25; 8:45 am]
BILLING CODE 4410-09-P
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</html>Indexed from Federal Register on October 17, 2025.
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