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Blais v. Rhode Island Department of Health

Superior Court of Rhode Island

July 21, 2016

RHODE ISLAND DEPARTMENT OF HEALTH and MICHAEL FINE, M.D. In his capacity as the Director of Health of the Rhode Island Department of Health

         Providence County Superior Court

          For Plaintiff: Michael A. Kelly, Esq.

          For Defendant: Michael W. Field, Esq.; Joseph K. Alston, Esq.; Mariana E. Ormonde, Esq.; Julie Ann Sacks, Esq.; Adam Sholes, Esq.


          PROCACCINI, J.

         This matter came to be heard on June 29, 2016 before the Superior Court, Procaccini, J., on Appellant Leo Blais, R.Ph.'s (Appellant or Mr. Blais) Motion for Litigation Expenses under the Equal Access to Justice for Small Businesses and Individuals Act (EAJA), G.L. 1956 §§ 42-92-1 et seq. Appellant's motion comes before this Court following his successful appeal to the Rhode Island Superior Court from a decision of the Director of the Rhode Island Department of Health (the Department), Michael Fine, M.D. (Director Fine), (collectively, Appellees) that permanently revoked Appellant's license to practice pharmacy in the State of Rhode Island (Final Decision). For the reasons set forth in this Decision, this Court finds that Appellant is legally entitled to recover reasonable litigation expenses arising out of and related to Appellant's appeal of Director Fine's Final Decision.

         I Facts and Travel

         The facts underlying this case are essentially undisputed and set out in further detail in Blais v. R.I. Dep't of Health, No. PC 2012-5791, 2014 WL 7368789 (R.I. Super. Dec. 22, 2014) (Nugent, J.). On March 14, 2012, a mother of an infant child sought to file a complaint against Apothecare Compounding Solutions (Apothecare), a compounding pharmaceutical shop, with the State Board of Pharmacy (the Board). Id. at *1. The mother had filled a prescription for her infant at Apothecare for Omeprazole, [1] a stomach medication for acid reflux. Id. After the infant became lethargic, the mother took her child to the hospital and was informed that the Omeprazole contained morphine. Id. Morphine does not belong in Omeprazole. Id. The Office of Compliance and Regulatory for the Board sent the prescribed Omeprazole to the State Toxicology Lab and confirmed that the drug contained morphine. Id.

         A full investigation was conducted of Apothecare, including speaking to the pharmacist in charge, Mr. Blais, and inspecting the physical location of the pharmacy. Id. at *1-2. Mr. Blais has been a pharmacist for approximately thirty-five years and was President of the Rhode Island Pharmacist Association. Id. at *1. He additionally served as a member of the Board for twelve years. Id. Upon investigation of Apothecare, Dr. Patrick Kelly (Dr. Kelly), Chief of Compliance and Regulatory, found the compounding area to be cluttered and disorganized. Id. at *1-2. Dr. Kelly also noted that many drugs were stored on the floor, without any sign of markers separating one drug from another. Id. at *2. Finally, the investigation revealed that another child had received and ingested the adulterated Omeprazole.[2] Id. Mr. Blais admitted that the adulterated drug was a result of the disordered state of the pharmacy. Id.

         On March 23, 2012, Director Fine summarily suspended Mr. Blais' license in accordance with § 42-35-14(c). Id. at *3. Mr. Blais and the Board attempted to enter into a Consent Order, agreeing to a two-year suspension, with the commencement of the first year dating back to the issuance of the summary suspension. Id. However, Director Fine rejected this Consent Order. Id. The Board ultimately delegated its authority to hear Mr. Blais' appeal to a hearing officer, Catherine Warren (Hearing Officer Warren). Id. After a multi-day hearing, Hearing Officer Warren issued a twenty-nine page decision, finding: (1) the drug labeled as Omeprazole inappropriately contained morphine; (2) the pharmacy was kept in an unsanitary and disorderly condition; and (3) drugs without expiration dates were not properly labeled or segregated. Hearing Officer Warren's Decision 15-18; see also Blais, 2014 WL 7368789, at *3-4. Based upon her factual findings, Hearing Officer Warren recommended a thirty-month license suspension (fifteen months active, with the remainder stayed), two-year probationary period, and continuing education classes. Hearing Officer Warren's Decision 26-27.

         Director Fine accepted Hearing Officer Warren's findings of fact but found that Hearing Officer Warren failed to adequately weigh "the potential danger morphine poses to a baby or infant child." Final Decision 4; see also Blais, 2014 WL 7368789, at *4. Director Fine also found Mr. Blais' newly installed safety measures unpersuasive, as Mr. Blais had numerous chances to improve the organization of his pharmacy but failed to do so. Final Decision 4. As a result, Director Fine permanently revoked Mr. Blais' license to practice pharmacy. Id. This was the first and only time a pharmacist's license was permanently revoked by the Department for a dispensing error. Blais, 2014 WL 7368789, at *4.

         Mr. Blais timely appealed Director Fine's Final Decision to revoke his license on July 16, 2013. Id. Mr. Blais argued that Director Fine's Final Decision failed to give adequate deference to Hearing Officer Warren's findings and imposed sanctions in excess of Director Fine's statutory authority. Id. The matter was heard on November 25, 2014 before Judge Stephen Nugent. Id. In a carefully crafted decision, the Court held that "Director Fine acted in excess of his statutory authority and abused his discretion in revoking Mr. Blais' license to practice pharmacy." Id. at *7. The Court reasoned that Director Fine failed to give proper deference to Hearing Officer Warren's findings of fact and that the record did not support a deviation from such findings. Id. at *5-7. The Court noted that Hearing Officer Warren did in fact consider the dangers of a dispensing error, as well as assess the credibility of the witnesses and Mr. Blais' competency to safely practice. Id. at *6-7. The Court also recognized that pharmacists cannot be held to a standard of perfection, and, at least since 1980, the Board has never suspended a pharmacist for a dispensing error. Id. at *7. Finally, the Court acknowledged Mr. Blais' long-standing credentials and his willingness to adopt remedial measures and admit his errors. Id. As a result, the Court found that "Director Fine's 'mere philosophical differences' as to the proper discipline in the wake of such an incident served as the fulcrum upon which he uprooted Hearing Officer Warren's well-grounded sanction" in direct contradiction of administrative law. Id. at *6. See generally Envtl. Scientific Corp. v. Durfee, 621 A.2d 200 (R.I. 1993). The Court ultimately modified the agency decision to impose Hearing Officer Warren's recommended suspension and probation. Blais, 2014 WL 7368789, at *8.

         Shortly after Judge Nugent's decision was rendered, Appellant moved for litigation expenses under the EAJA. However, the present motion was set aside for quite some time as Appellee's Petition for a Writ of Certiorari (Writ) to the Supreme Court was pending. On June 18, 2015, the Supreme Court denied Appellee's Amended Petition for a Writ. See Appellant's Mem., Ex. 8. The parties have recently completed additional discovery. On May 3, 2016, Appellant again moved for litigation expenses under the EAJA. Appellant seeks a total of $63, 323.48 in litigation expenses, $55, 056.25 in attorneys' fees and $8, 267.23 in expert and stenographer fees. See Appellant's Mem., Ex. 3. These litigation expenses were incurred in connection with Appellant's administrative proceeding, administrative appeal, and defense against Appellee's Petition for a Writ. See Appellant's Mem. 14.

         II Analysis

         A Litigation Expenses Under the EAJA

         The EAJA "'was propounded to mitigate the burden placed upon individuals and small businesses by the arbitrary and capricious decisions of administrative agencies made during adjudicatory proceedings.'"[3] Tarbox v. Zoning Bd. of Review of Jamestown, Nos. 2014-188-Appeal, 2014-189-Appeal, 2016 WL 984044, at *6 (R.I. Mar. 15, 2016) (quoting Krikorian, 606 A.2d at 673). The act encourages individuals and small business to challenge agency actions that are not substantially justified. See id. Section 42-92-3(a) outlines a party's application for litigation expenses under the EAJA:

"Whenever the agency conducts an adjudicatory proceeding subject to this chapter, the adjudicative officer shall award to a prevailing party reasonable litigation expenses incurred by the party in connection with that proceeding. The adjudicative officer will not award fees or expenses if he or she finds that the agency was substantially justified ...

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