This cause came on to be heard before this specially constituted Court of three judges convened pursuant to the provisions of Section 2284, Title 28 U.S.C.A. Evidence and briefs having been submitted, oral argument of counsel had and the Court being now duly advised in the premises makes the following Findings of Fact and enters the following Conclusions of Law:
1. Plaintiff is a California corporation, having its principal place of business in the City of Long Beach, California. Defendant Oscar R. Ewing is the Administrator of the Federal Security Agency; and Paul B. Dunbar, Charles W. Crawford, Louis D. Elliott and George P. Larrick are the Commissioner, Associate Commissioner and Assistant Commissioners, respectively, of the Food and Drug Administration of the Federal Security Agency; Defendants ant J. Howard McGrath is the Attorney General of the United States and was substituted as a defendant in place of Tom C. Clark on October 17, 1949. Defendants are all charged by law with the administration and enforcement of the Federal Food, Drug, and Cosmetic Act of 1938, 21 U.S.C.A. § 301 et seq.
2. This suit arises from administrative action taken by the defendants under that part of Section 304(a) of the Federal Food, Drug, and Cosmetic Act, 21 U.S.C.A. §§ 301, 334(a), which provides that more than one libel for condemnation proceeding may be brought upon the same alleged misbranding 'when the Administrator has probable cause to believe from facts found, without hearing, by him or any officer or employee of the Agency that * * * the labeling of the misbranded article * * * would be in a material respect misleading to the injury or damage of the purchaser or consumer'; and under Sections 2282 and 2284 of Title 28 of the United States Code Annotated, Judiciary and Judicial Procedure, which provides the procedure by which this court was convened to hear an application to restrain the enforcement, operation, or execution of the Federal Food, Drug, and Cosmetic Act, 21 U.S.C.A. § 301 et seq., for repugnance to the United States Constitution. (Complaint, Par.2; Answer, Third Defense, Par. 2).
3. The plaintiff is the exclusive national distributor of a food supplement consisting of multiple vitamins and minerals sold under the trade name of 'Nutrilite Food Supplement' (hereinafter called Nutrilite) through more than 5,000 distributors throughout the United States.
4. Nutrilite contains certain vitamins and minerals in a balanced proportion and in amounts claimed by some experts in the field as essential in human nutrition, plus extracts from alfalfa, parsley and watercress.
5. Nutrilite contains no substance or material or combination of substances or materials harmful or deleterious in any manner to human users thereof when taken in suggested dosage. No claim has been made by any Federal, State or other governmental agency that Nutrilite is adulterated or harmful in any manner to the health of human users thereof, insofar as the record before the court shows.
6. The label of the package in which Nutrilite was and is sold complies with all requirements of the Food, Drug, and Cosmetic Act of 1938.
7. The objection of the defendants to the sale of Nutrilite, which is the basis of this action, is the use by plaintiff of an advertising pamphlet entitled 'How to Get Well and Stay Well'. Nutrilite is sold directly to users thereof and this pamphlet is used in making about 40% of the initial sales of Nutrilite.
8. The product now sold as Nutrilite was first marketed about 1933; defendants' records show they received information about it in 1939 and had correspondence about it in 1940; plaintiff has been its exclusive national distributor since 1945; defendants received their first copies of the then current edition of the pamphlet 'How to Get Well and Stay Well' on December 5, 1946, together with names and addresses of certain of plaintiff's distributors outside of California.
10. Plaintiff's attorney further advised the Food and Drug Administration on October 4, 1947, that the rewriting of plaintiff's pamphlet had commenced promptly and was progressing as rapidly as possible considering the quantity of the material involved and the corrections required by him and that when finally completed he was sure none of the literature of plaintiff would be objectionable to said Administration.
11. There are three editions of the plaintiff's advertising pamphlet, 'How to Get Well and Stay Well', which are involved in the libel seizure cases, hereinafter described: the 58-page edition which was used by plaintiff from January 1948 until a few days after the first seizure in October, 1948, and which is identified in the record as plaintiff's Exhibit #1; the 36-page edition consisting of the first 36 pages of the 58-page edition, which was used from the time the 58-page edition was discontinued up to about December 1, 1948, and which is identified in the record as plaintiff's Exhibit #2; and the 42-page edition consisting of the 36-page edition changed slightly in non-substantial statements plus 6 additional pages, which has been used from about December 1, 1948 up to the time of the trial herein, and which is identified in the record as plaintiff's Exhibit #3.
12. (a) The three editions of the advertising pamphlet 'How to Get Well and Stay Well' which are involved in and form the basis of the seizure actions hereinafter described, where written and prepared chiefly by William S. Casselberry, President of the plaintiff corporation. He has an A.B. degree from the University of California and M.A. and Ph.D. degrees from Stanford University. Prior to writing 'How to Get Well and Stay Well' he read some medical and nutritional literature on the subject of vitamins and minerals. In the preparation of the three pamphlets he relied upon some scientific and medical treatises; surveys made by the medical profession with respect to the use of vitamins and minerals; publications of the Federal Government relating to the amount of vitamins and minerals required in the diet of humans and the efficacy of vitamins and minerals in human nutrition; and the findings and statements made by the Food and Drug Administration with respect to the need for and desirability of vitamins and minerals in the human diet.
(b) The rewriting of the pamphlet required a period of approximately five months. During this period Dr. Casselberry checked the various drafts of the pamphlet with his company's attorney, the chemist who discovered and developed Nutrilite's secret base, and with neighbors to get the reactions of laymen to the pamphlet.
(c) Plaintiff's attorney, who supervised the rewriting, has specialized in the Food and Drug Act field for many years. He has in his library, and has read, a number of books and scientific writings written by medical doctors and others in the field of nutrition, vitamins and minerals. Defendants have stated that he is an experienced attorney in this field. He has approved the final drafts of each edition of the pamphlet before plaintiff began using them.
(e) The three pamphlets (P's. Exs. #1, 2 and 3), when read as a whole and fairly interpreted, without lifting statements therein out of context, do no more than represent that Nutrilite is a vitamin-mineral food supplement designed and intended to build up the bodies of human users thereof in order that it may aid nature to help the users enjoy better health through better nutrition. Said pamphlets do not represent to the minds of ordinary, reasonable and prudent persons that all of the symptoms, conditions and diseases of the human body necessarily or generally result from dietary deficiencies alone, or that all of the symptoms, conditions and diseases of the human body can be prevented, cured or treated by the use of Nutrilite, and said pamphlets do not represent, suggest, or imply that Nutrilite is a medicine or drug, or that it is efficacious or beneficial in the prevention, treatment, or cure of all diseases.
These pamphlets represent the product only as a food supplement containing vitamins and minerals beneficial to building up health and bodies and in alleviating, in some but not in all instances, symptoms resulting from vitamin and mineral deficiencies in the diet. Purchasers and consumers do not understand from these pamphlets that Nutrilite is a treatment or cure for any disease. The defendants' own survey to determine the impression gained by purchasers and consumers of the representations contained in these pamphlets under customary conditions of purchase and use reveals that the users interviewed uniformly came to these conclusions and understandings of the statements in the pamphlets.
(f) These three pamphlets when read as a whole are not fraudulent, misleading in a material respect to the injury or damage of the purchaser or consumer, or false or misleading in any particular. Neither Nutrilite nor its labeling has been made the basis of a prior judgment in favor of the United States in any case or proceedings finding it to be misbranded or adulterated, nor do these pamphlets misbrand the product Nutrilite Food Supplement within the intent of the provisions of the Food, Drug, and Cosmetic Act of 1938. It is therefore found that the plaintiff has been and is acting in good faith in preparing and using these pamphlets.
13. After the plaintiff's rewriting of the pamphlet, and its publication in January, 1948, plaintiff learned that agents of the Food and Drug Administration were interrogating some of plaintiff's distributors and customers. In order to determine the basis for such interrogations, plaintiff arranged a meeting with representatives of the Food and Drug Administration at the Administration's office in Los Angeles. Plaintiff stated to the Chief of said Administration's office that it wished to comply with every phase of the Food, Drug, and Cosmetic Act and asked whether the investigation and interrogations were prompted by a belief in any way violated any provision of said Act. The said Chief advised plaintiff that the investigation and interrogations were merely routine in nature and said Chief made no statement implying or suggesting that the Food and Drug Administration had any objection to the pamphlet 'How to Get Well and Stay Well'.
Plaintiff further stated to said Chief that should any question arise any time in the future concerning the alleged violation of said Act (misbranding) by any product distributed by plaintiff or in connection with any phase of plaintiff's business or operations, that if the Food and Drug Administration would notify the plaintiff thereof immediately when such question arose, plaintiff would do its utmost to comply with the views of the Food and Drug Administration.
14. on September 15, 1948, a secret indictment was returned in Los Angeles against the plaintiff's two principal stockholders, Lee S. Mytinger and William S. Casselberry, based upon allegations of misbranding of Nutrilite by the edition of the pamphlet 'How to Get Well and Stay Well' obtained by defendants on December 5, 1946, products shipped by plaintiffs on January 3, 1947 and February 26, 1947, and which were involved in the notice and hearing thereon in July, 1947. The Federal Judge to whom this indictment was assigned for trial has advised the parties that he considers the trial a waste of Government money due to the discontinuance of the labeling there questioned. This indictment has not yet been set for trial.
15. On October 6, 1948, without prior notice to plaintiffs, the defendants instituted or caused to be instituted and commenced a libel action under which some packages of Nutrilite and some copies of the 58-page pamphlet 'How to Get Well and Stay Well' were seized in Belleville, New Jersey. Said libel alleged the misbranding of Nutrilite through the use of pages 37 through 58 of the 58-page edition of said pamphlet.
16. On September 28, 1948, defendant Crawford had authorized said seizure action of October 6, 1948, in Belleville, New Jersey, without reading pages 1 through 36 of this 58-page pamphlet. A reading of pages 1 through 36 of this pamphlet is hereby ...