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United States v. 2035 Inc.

United States District Court, D. South Dakota, Western Division

May 4, 2017

UNITED STATES OF AMERICA, Plaintiff,
v.
2035 INC., a corporation, and ROBERT L. LYTLE, an individual d/b/a 2035 PMA and QLASERS PMA, Defendants.

          MEMORANDUM OPINION AND ORDER

          KAREN E. SCHREIER UNITED STATES DISTRICT JUDGE.

         This matter is before the court following the recusal of Chief Judge Jeffrey L. Viken from any further participation in this matter. Docket 167. Currently pending are nine motions filed by pro se defendant Robert L. Lytle, and one motion filed by plaintiff, the United States. Dockets 164, 165, 168, 170, 180, 181, 185, 187, 189, 191. For the reasons that follow, the court denies each of the pending motions.

         BACKGROUND

         On October 21, 2014, the United States filed a complaint seeking a permanent injunction against the defendants under 21 U.S.C. § 332(a) for alleged violations of the Federal Food, Drug and Cosmetic Act (FDCA). Docket 1. The United States also filed a motion seeking a preliminary injunction to enjoin defendants from violating the FDCA during the pendency of the proceedings. Docket 4. After responding to the motion for the preliminary injunction, Docket 28, Lytle filed various motions to dismiss challenging the court's personal and subject-matter jurisdiction. Dockets 37, 40.

         On January 14, 2015, Chief Judge Viken denied Lytle's motions to dismiss finding that “[t]he court has jurisdiction over the subject matter of this action and has personal jurisdiction over the parties pursuant to 28 U.S.C. §§ 1331 and 1345 and 21 U.S.C. § 332.” Docket 47 at 5. Chief Judge Viken also granted the United States's motion for a preliminary injunction. Id. at 15; Docket 48. Following this decision, Lytle filed an interlocutory appeal to the Eighth Circuit Court of Appeals challenging the court's jurisdiction and the preliminary injunction. See Docket 54.

         While Lytle's interlocutory appeal was pending, litigation on the United States's request for a permanent injunction continued. Docket 71 (order by Chief Judge Viken denying Lytle's motion to stay proceedings during interlocutory appeals process); see also Docket 94 (order by the Eighth Circuit Court of Appeals denying Lytle's motion to stay proceedings during the interlocutory appeals process). A bench trial on the United States's request for a permanent injunction was held by Chief Judge Viken on March 3-4, 2015.[1]Docket 81. On April 15-16, 2015, Chief Judge Viken held a show cause hearing to determine whether to hold Lytle in contempt of court for alleged violations of the preliminary injunction. Docket 103. On April 16, 2015, this hearing was continued until October 6, 2015, [2] so Lytle could retain counsel. Docket 106.

         On August 21, 2015, the Eighth Circuit issued an opinion on Lytle's interlocutory appeal. Lytle v. U.S. Dep't of Health & Human Servs., 612 F. App'x 861 (8th Cir. 2015) (per curiam). In the opinion, the Eighth Circuit affirmed Chief Judge Viken's finding that the court had jurisdiction over Lytle's alleged violations of the FDCA. See Id. at 862 (“That a product is sold through a PMA [(Private Membership Association)] does not exempt it from the application of this provision.” (citing 21 U.S.C. § 321(e) (person subject to FDCA includes association))). While concluding that the United States was entitled to preliminary injunctive relief, the Eighth Circuit remanded the case for a determination of “whether a more narrowly-tailored injunction might be sufficient . . . .” Id. at 863. The Eighth Circuit panel also observed that reconsideration of the preliminary injunction on remand “may become moot” by the entry of a permanent injunction. Id.

         Following the Eighth Circuit's decision on Lytle's interlocutory appeal, Lytle filed a motion in the district court seeking reconsideration of the preliminary injunction. Docket 128. This motion raised eight objections that challenged the scope of the preliminary injunction. Id. The United States opposed Lytle's motion and requested that Chief Judge Viken enter a permanent injunction on the same terms as the preliminary injunction. Docket 132 at 22-23.

         On October 6, 2015, the show cause hearing resumed with Chief Judge Viken recounting what happened on April 15-16, 2015, and describing the events that led to the hearing being continued. Docket 154 at 3-8 (transcript of show cause hearing on October 6, 2015). Next, Chief Judge Viken and the parties discussed whether the United States still intended to call Lytle as an adverse witness and the potential Fifth Amendment implications associated with calling Lytle as an adverse witness. Id. at 8-22. At the conclusion of this discussion, Shultz, as Lytle's attorney, articulated what he believed the impact of the Eighth Circuit's decision was on Lytle's interlocutory appeal and noted the Eighth Circuit's observation that the entry of a permanent injunction may moot any issues related to the preliminary injunction. Id. at 23. Shultz then remarked that “I am here to say on behalf of Mr. Lytle that we have no objection to the entry of permanent injunction . . . with the proviso that the Court rules upon the matters presented by defendant Lytle's motion for reconsideration following remand.” Id. at 23-24.[3] After a discussion regarding how to move forward in addressing Lytle's objections, it was agreed that Chief Judge Viken would rule on each of Lytle's eight objections and then enter an order regarding a permanent injunction taking into consideration his rulings on Lytle's objections. Id. at 24-34.

         Prior to entering the permanent injunction, Chief Judge Viken granted the United States time to re-draft the permanent injunction in light of his rulings on Lytle's objections. Id. at 73-76. It was then agreed by the parties that Chief Judge Viken would go through the draft of the permanent injunction to address any final objections by the parties. Id. at 74-76. After ruling on the various objections to the final draft of the permanent injunction, see Id. at 77-146 (transcript of objections and discussion of permanent injunction draft), Chief Judge Viken entered an order granting the permanent injunction. Docket 138. The permanent injunction was amended on October 13, 2015, to make grammatical and non-substantive revisions. Docket 139 (Amended Permanent Injunction).

         On November 25, 2015, Shultz, with Lytle's consent, filed a motion to withdraw as counsel for Lytle. Docket 143; see also Docket 150 (order granting Shultz's motion to withdraw). On December 3, 2015, Lytle filed a notice of appeal from the Amended Permanent Injunction with the Eighth Circuit Court of Appeals. Docket 147. On September 6, 2016, the Eighth Circuit affirmed Chief Judge Viken's entry of the Amended Permanent Injunction. United States v. 2035, Inc., 668 F. App'x 679 (8th Cir. 2016) (per curiam). In the opinion, the Eighth Circuit found that the court had jurisdiction over Lytle's case to enter a permanent injunction. Id. at 679 (citations omitted) (“We find that the district court had federal question jurisdiction over this action . . . .”). The Eighth Circuit also concluded that Chief Judge Viken's Amended Permanent Injunction order “was narrowly tailored to correct Lytle's violations of the FDCA . . . .” Id. (citing Fed.R.Civ.P. 65(d) and Doe v. S. Iron R-1 Sch. Dist., 498 F.3d 878, 884 (8th Cir. 2007)).

         DISCUSSION

         I. Lytle's Motions to Dismiss.

         Currently, Lytle has four motions pending that seek to dismiss his case on various grounds. See Dockets 165, 170, 185, 187. Lytle's first two motions to dismiss seek to challenge the court's jurisdiction over Lytle personally and over his case. See Docket 165 at 3; Docket 170 at 14. Lytle's last two motions to dismiss seek dismissal on non-jurisdictional grounds. Docket 185 at 1; Docket 187 at 5. The United States argues that Lytle's jurisdictional arguments are the same arguments that the Eighth Circuit has twice rejected and should be denied under the law of the case doctrine. Docket 176 at 2-3 (citing Arizona v. California, 460 U.S. 605, 619 (1983)). The United States further argues that Lytle's most recent motions to dismiss should fail because the motions were procedurally improper at the time they were filed.[4] See Docket 188 at 5-6.

         A. The Law of the Case Doctrine Bars Lytle's Jurisdictional Challenges.

         The law of the case doctrine is “a means to prevent the relitigation of a settled issue in a case.” Gander Mountain Co. v. Cabela's, Inc., 540 F.3d 827, 830 (8th Cir. 2008) (citing United States v. Bartsh, 69 F.3d 864, 866 (8th Cir.1995)). “The doctrine ‘requires courts to adhere to decisions made in earlier proceedings in order to ensure uniformity of decisions, protect the expectations of the parties, and promote judicial economy.' ” Id. (quoting Bartsh, 69 F.3d at 866). Thus, where an appellate court renders a decision in a case and remands the case for further proceedings, “every question decided by the appellate court, whether expressly or by necessary implication, is finally settled and determined, and the court on remand is bound by the decree and must carry it into execution according to the mandate.” Thompson v. Comm'r, 821 F.3d 1008, 1011 (8th Cir. 2016) (citing Klein v. Arkoma Prod. Co., 73 F.3d 779, 784-85 (8th Cir. 1996)). Under the law of the case doctrine, a reexamination of a prior decision is only appropriate “if a prior decision ‘is clearly erroneous and would work a manifest injustice . . . .' ” Id. (quoting Wong v. Wells Fargo Bank, N.A., 789 F.3d 889, 898 (8th Cir. 2015)).

         Here, Lytle continues to argue that the court lacks jurisdiction over him and his case. Docket 165 at 3; Docket 170 at 14; see also Dockets 37, 40, 79, 144, 145 (previous motions to dismiss filed by Lytle arguing there was a lack of subject-matter or personal jurisdiction). Not only has Chief Judge Viken denied Lytle's motions to dismiss his case on jurisdictional grounds, Dockets 47, 96, 153, but the Eighth Circuit has twice denied Lytle's appeals in which he argued there was a lack of jurisdiction. First, in Lytle, 612 F. App'x at 861-62, the Eighth Circuit rejected Lytle's argument that “the FDA lacks regulatory jurisdiction over [Lytle's] marketing of laser devices because [Lytle] distributes them in non-commercial transactions through private membership associations (PMAs).” This is because the fact “[t]hat a product is sold through a PMA does not exempt it from the application of this provision.” Id. at 862 (citing 21 U.S.C. § 321(e)) (person subject to FDCA includes association). Similarly in 2035, Inc., 668 F. App'x at 679, the Eighth Circuit again concluded that this court had federal question jurisdiction over Lytle's case that was sufficient to allow the court to enter a permanent injunction against Lytle. Id. (citations omitted) (“We find that the district court had federal question jurisdiction over this action . . . .”).

         Under the law of the case doctrine, this court is bound to follow the Eighth Circuit's decisions in this case unless such decisions are clearly erroneous and would work a manifest injustice on Lytle. See Thompson, 821 F.3d at 1011 (citation omitted). Lytle has made no showing that the Eighth Circuit's decisions-like Chief Judge Viken's decisions regarding Lytle's jurisdictional challenges-are erroneous, let alone clearly erroneous. Thus, Lytle's ...


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