Intro to the Legal System

1. Anthony B. Tagavi, PharmD, JD
Summer Quarter 2017

2.  The Greek philosophers (Plato and Aristotle)
posited existence of natural justice or natural
right.
◦ Basic idea of rights and morality is inherent in the
reasoning of man.
 Development of the tradition of natural justice
into one of natural law attributed to the Stoics.
The Stoics asserted the existence of a purposeful
order in the universe and the means by which a
person lived in accordance with this order was
the natural law.
◦ This propelled the idea of creating a legal system. The
idea of human made law is credited by an analyzation of
the inherent, natural law humans are given.

3.  Natural Law:
◦ Statement: Murder is wrong.
◦ Reasoning: Nature and logic dictate it.
 Moral Law:
◦ Statement: Prostitution is wrong.
◦ Reasoning: Morality and ethics (more of a religious
subset) dictates it.
 Positive Law:
◦ Simply man-made law deriving from a societal
body.

4.  The concept of natural law was very
important in the development of the English
Common Law.
 Common law derives from the period
following the Norman Conquest of England.
 Henry II, in 1154 established a uniform
system of law ‘common’ to the country by
incorporating and elevating local customs to
the national custom, ending local control and
peculiarities, eliminating arbitrary remedies
and reinstating the jury system.

5.  Henry sent his judges into the country to
resolve disputes according to their
interpretation of local customs. The judges
would then discuss their decisions with the
other judges and these decision would be
recorded. In time, the rule known as stare
decisis, by which a judge is bound to follow
the precedent of the earlier decisions.
 By means of precedents, a consistent system
of law developed that was common
throughout the country-The Common Law

6.  A legal system that gives great weight to the
principle that it is unfair to treat similar facts
differently on different occasions. Thus
reliance on precedents.
 Common law systems are in widespread use
in nations that trace their legal heritage to
England as former colonies (USA, Canada,
etc).

7.  In contrast to common law, there are “code”
jurisdictions based upon Roman law. The
codification of Roman law occurred under
Emperor Justinian-the Code of Justinian -6th
Century. In these jurisdictions, judicial precedent
is given less weight in decision-making. This
means the judge in a given case has more
freedom to interpret the text of a statute
independently and scholarly literature is given
more weight. An example: the Napoleonic Code
upon which Louisiana law is based.

8.  Hart-Fuller debate
◦ Skateboard in the park.
◦ Moral (common law approach) v. Positive (civil law
approach).
◦ Morality – look at what the law that was passed was
intended to prevent
 Vehicles not in the park to prevent noise pollution? Or
to prevent harm of a car.
 Purpose instead of meaning.
◦ Code – strict definition (even though there will still
be a need for interpretation of the law).
 Vehicles should strictly be defined. So cars, trucks, etc.
 Strict meaning. Legislative intent is irrelevant.

9.  Laws are generally regarded as requirements for
human behavior, applying to all persons within a
jurisdiction, commanding what is right,
prohibiting what is wrong, and imposing
sanctions for violations (damages, specific
performance, imprisonment etc.).
 However, the law is more than a collection of
mandates and prohibitions. It is a framework
whereby people in a society resolve their
disputes in a way that does not involve force and
consistently yields results that are satisfactory to
most of society.

10.  Constitutional Law: The supreme law of the
USA is the Constitution. Every federal or state
law must meet the test of validity, i.e., it must
not conflict with the Constitution.
 Treaties: Agreements between nations thus
creating international laws.
 Executive Orders: Orders issued by the
president with the full force of law behind it.
◦ These orders essentially piggy back the federal
organic statutes that created the federal agency.

11.  Statutory Law: Laws (statutes) enacted by a
legislative body (federal and state);
Ordinances enacted by a municipal or county
council.
 Administrative Law: Both the Congress and
the State Legislatures delegate authority to
administrative agencies (via organic statutes)
to promulgate regulations that interpret and
define statutes and procedures for
enforcement of statutes.

12.  It must be based upon a(n) (organic) statute that
gives the agency authority to promulgate the
rule.
 It must be within the scope of the agency’s
authority.
 It must bear a reasonable relationship to the
public health, safety, and welfare.
 Administrative rules are subject to review by the
legislative body granting authority to the agency.
 Administrative decisions are subject to appeal to
a higher court.

13.  Common (Case) Law: Decisions of courts as a
result of litigation involving disputes because of
statutes or actions of the parties involved in a
litigation. In these situations, the court’s duty is
to apply proper law to the facts before it and
resolve the matter through a judicial decision.
 Judicial decisions establish enforceable legal
principles either by expanding the common law
or by interpreting statutes and regulations. (Rite
Aid of New Jersey v. Board of Pharmacy)

14.  Facts:
◦ Several pharmacies, including Rite Aid, filed suit against the Board of
Pharmacy after promulgating a regulation indicating that “prescription
records” for each patient be kept on file as part of their “patient profile”.
The legislation regarding “patient profiles” did not mandate “prescription
records” among the list of requirements.
 Issue
◦ Can the Board of Pharmacy interpret a legislation dictating specific
requirements in the statute to add an additional requirement to satisfy a
“patient profile”?
 Rule
◦ Yes. The Board of Pharmacy was allowed to create an additional regulation
furthering the statute.
 Analysis
◦ This was allowed because the Board of Pharmacy was furthering the
objective of the state law requiring pharmacists to keep records to protect
the public.
 Conclusion
◦ Courts may interpret statutes that appear narrow, in a broad sense to let
government agencies modify them.

15.  Stare Decisis: to abide by decided cases.
 Stare decisis serves two purposes:
◦ 1) Establishes continuity of decisions;
◦ 2) Expedites judicial decision-making
 It is not inflexible. A court may vary from
precedent for two reasons:
◦ 1) there must be factual distinctions between a case
before it and previous decisions upon which the
court relies;
◦ 2) A court may vary from a precedent because of
changing times or circumstances.

16.  The Constitution gives certain powers to the federal
government, while reserving the rest for the states.
 Federal law – laws can only arise under a Constitutional
basis.
◦ Interstate Commerce Clause – liberal usage
 State law – plenary power. State laws can arise for any
reason.
◦ Tenth amendment: gives states all powers not delegated to feds.
 In general a State has authority to regulate in any area it
deems necessary within the boundaries of its jurisdiction
as long as there is no conflict with a federal law or
regulation. If there is a conflict, the federal law prevails
under the Supremacy Clause of the Constitution.
◦ Example: Federal law states that there are no refills allowed on c2
prescriptions. State X law says that are two refills allowed on c2
prescriptions. Federal law prevails.

17.  If a state and federal law regulate the same
matter, the more stringent law prevails.
◦ Example: Federal law says 5 refills on c3-5
prescriptions. State X says 0 refills on c3-5
prescriptions. Following the more stringent law
(State X) is applicable.
 Ultimately, if you follow the more stringent
law, it will satisfy both of these general rules.

18.  Facts
◦ Pharmaceutical manufacturer in Chicago shipped properly labeled bottles
of sulfathiazole tabs (legend drug per FDA) to an Atlanta, GA wholesaler.
Pharmacist Sullivan (Columbus, GA) bought from wholesaler and sold
without an Rx.
 Issue
◦ Sullivan contended that the FDCA did not apply to transactions between
his pharmacy and his customers because these were entirely intrastate
transactions.
 Rule
◦ FDA has purview over all prescription transactions per the interstate
commerce clause, even if the transaction was wholly conducted within a
single state.
 Analysis
◦ Court held that the Act extends to even these intrastate transactions
because its intent is to protect the public and that intent would be
subverted by a narrow definition of interstate commerce.
 Conclusion
◦ So look at the market as a whole, and not as a narrow instance like this
case. The market is an interstate market, even if this small example is
intrastate.

19.  Criminal v. Civil
◦ Criminal – Government v. Person
◦ Civil – Person v. Person
 Damages ($$$)
 Specific Performance (Injunction, etc.)
 Federal v. State
◦ Federal – Diversity of citizenship or issues involving
federal question under the Constitution.
◦ State – All state issues.

22.  Federal Level
◦ FDA: Food & Drug Administration
 Housed in the Department of Health and Human Services
(Secretary of HHS)
 Responsible for the general manufacturing and distribution
of all drugs, foods and cosmetics.
◦ CMS: Center for Medicare and Medicaid Services
 Housed in the Department of Health and Human Services
(Secretary of HHS)
 Responsible for reimbursement policies to pharmacies and
other health care providers participating in medicare and
medicaid services.
◦ DEA: Drug Enforcement Agency
 Housed in the US Justice Department (Attorney General)
 Responsible for overseeing and enforcing laws regarding
controlled substances and the abuse thereof.

23.  Federal Level
◦ FTC: Federal Trade Commission
 Independent agency (outside the purview of executive
departments)
 Responsible for antitrust laws in the general stream of
commerce (including pharmacy market)
◦ USPTO: United States Patent and Trademark Office
 Housed in the Department of Commerce (Secretary of
Commerce)
 Responsible for approving all patents on novel drugs

24.  State Level
◦ Kentucky Board of Pharmacy
 Founded by KRS 315.002 (State Food, Drug & Cosmetic
Act)
 Acts as the State FDA (but even more plenary and
expansive)
◦ Cabinet for Health and Family Services
 Founded by Kentucky Controlled Substance Act
 Acts as the State DEA.

25.  Reasons for the government to regulate
medicinal drugs:
1. Public Goods
 i.e. Orphan Drugs
2. Externalities
 i.e. Antibiotic resistance
3. Natural Monopolies
 i.e. Promote incentive and competition
4. Information Asymmetry
 i.e. allowing pharmacists to be experts in this field.
Public doesn’t understand the benefits of drugs.