Dr. Jackson was sentenced to 25 years in prison and three years of supervised release in 2023 after being found guilty of device adulteration, fraud, conspiracy and identity theft. Prosecutors alleged that between 2011 and 2017, she reused single-use surgical devices on more than 1,500 Medicare patients without proper sterilization.
This decision could have sweeping implications for the new administration’s enforcement of healthcare fraud, according to the post.
“During the first Trump administration, the US Department of Justice brought record-breaking criminal charges and recoveries for healthcare fraud,” the report said. “Now, with newfound vigor in the wake of Jackson, we expect the DOJ and the U.S. Food and Drug Administration under the second Trump administration to continue aggressively prosecuting fraud involving medical devices by supplementing long-standing enforcement mechanisms with additional charges under Section 301(k).”
The court’s ruling is notable for its interpretation of the Federal Food, Drug, and Cosmetic Act, which regulates medical devices to ensure patient safety, according to the firm. Specifically, it found that Dr. Jackson violated Section 301(k), which prohibits altering, damaging or removing labels from medical devices in a way that renders them unsafe or “adulterated.”
Unlike typical healthcare fraud cases that focus on fraudulent billing, this ruling centers on medical device reuse. The court determined that by reusing single-use devices without proper sterilization, Dr. Jackson had “adulterated” them, creating a precedent that could broaden future prosecutions.
“We anticipate that the government will, alongside its existing arsenal of healthcare fraud enforcement tools, wield criminal penalties under the FDCA against hospitals, private practices and medical providers,” the post said. “As such, industry participants can expect close scrutiny by federal and state enforcers over the use of allegedly adulterated medical devices to perpetuate healthcare fraud.”
According to the post, this is only the second appellate ruling to interpret Section 301(k) and the first since the Supreme Court’s Loper Bright decision, which held that courts should defer to federal agency interpretations of ambiguous laws when reasonable. Despite this, the court endorsed a broad reading of the law, signaling strong judicial support for FDA enforcement in healthcare fraud cases.
The ruling also sets a significant precedent regarding what constitutes “holding for sale” under the FDCA, according to the report. Dr. Jackson argued that because she did not sell the reused devices, Section 301(k) should not apply. However, the court ruled that using an adulterated device in a paid procedure qualifies as “holding for sale.” This interpretation could expand regulatory liability for physicians who modify or reuse medical devices in unauthorized ways.
Additionally, Dr. Jackson invoked the FDCA’s “practice of medicine” exemption, which allows physicians to use approved medical devices at their discretion. However, the court ruled that once a device becomes adulterated, physicians lose this protection. This decision could limit physicians’ ability to use medical devices off-label, making such practices riskier in the future.
