| A corporation, a corporate officer, a corporate director or a corporate employee may be charged with violating the federal Food, Drug and Cosmetic Act. The Act prohibits the misbranding and adulterating of food, drugs, or cosmetics. A violation of this act is generally classified as a misdemeanor. However, if the defendant violated the Act with the actual intent to defraud or mislead, the classification of the offense is elevated to a felony.
In an action involving a corporate director, officer, or employee's violation of the Act, the prosecution is required to show by way of prima facie evidence that there was sufficient evidence to warrant a finding by the trier of fact that the defendant had by reason of his position in the corporation, the responsibility and authority to prevent a violation of the Act or to promptly correct the issue and did not.
Defenses
Under the Act, a dealer cannot be prosecuted for shipping adulterated or misbranded goods in interstate commerce when the dealer holds a guaranty from the vendor that the goods were in proper form. Moreover, the dealer would not be subject to prosecution under the Act for receiving adulterated or misbranded goods if the delivery of the goods was made in good faith. However, if the dealer fails to provide the name and address of the seller of the goods, the dealer may be prosecuted.
A corporate director, official, or employee may raise the defense that he or she did not have the authority or power to prevent the corporate violation of the Act. The prosecution is required to show that the corporate director, official, or employee had, by reason of his or her position in the corporation, the responsibility or authority either to prevent in the first violation or to promptly correct the violation complained of.
A corporate director, official, or employee may also raise the defense of helplessness. It may be argued that the defendant was powerless to prevent or to correct the corporate violation of the Act. If the defendant makes the "powerless" claim, he or she is required to produce evidence to support the contention. However, the prosecution has the ultimate burden of proving beyond a reasonable doubt the defendant's guilt, including his or her power, in light of the duty imposed by the Act, to prevent or correct violating the Act.
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