## Facts

- The United States filed a libel of information (in rem) seeking condemnation of seven barrels labeled “Spray Dried Whole Egg” under the Federal Food, Drug, and Cosmetic Act (FDCA), alleging the food was adulterated.
- The claimant, Marshall Kirby & Co., Inc., had segregated and set aside the seven barrels for a contemplated sale to the Federal Surplus Commodities Corporation.
- Before any purchase would occur, the prospective government buyer required sampling, inspection, and testing to determine whether the product met its specifications.
- At the time the libel was filed and the barrels were seized, the lot remained in the state where it was produced and stored; it had not been shipped across state lines.
- No completed sale had occurred, and the record did not show that this specific lot had previously traveled in interstate commerce.
- The claimant challenged federal jurisdiction, arguing FDCA condemnation under 21 U.S.C. § 334(a) required proof that the seized lot was introduced into interstate commerce or was held for sale after an interstate shipment.
- The district court dismissed the libel for want of jurisdiction, and the United States appealed.

## Issues

1. Whether food that has been set aside for a contemplated out-of-state sale, but has not yet been shipped, is “introduced into or while in interstate commerce” within the meaning of FDCA § 304(a), 21 U.S.C. § 334(a).
2. Whether such food may be condemned as “held for sale after shipment in interstate commerce” when the government does not show that the seized lot previously moved in interstate commerce.

## Decision

- The Seventh Circuit affirmed the district court’s dismissal of the libel.
- The court held the United States failed to prove the statutory interstate-commerce basis required for condemnation under FDCA § 304(a).
- Segregating the barrels for possible sale to a federal agency, pending inspection and testing, did not amount to introducing the goods into interstate commerce.
- The record also did not support condemnation under the “held for sale after shipment in interstate commerce” clause because there was no showing that this lot had been shipped in interstate commerce before it was held for sale.

## Legal Principles

- FDCA § 304(a), 21 U.S.C. § 334(a), authorizes condemnation only when the article is (1) introduced into or while in interstate commerce, or (2) held for sale after shipment in interstate commerce.
- Mere intent to sell or ship a product out of state, or preparatory steps taken in anticipation of a possible transaction, does not satisfy the “introduced into interstate commerce” requirement.
- The “held for sale after shipment in interstate commerce” provision requires proof that the same article (the seized lot) previously moved in interstate commerce.
- In an FDCA in rem seizure case, the government bears the burden to prove the interstate-commerce basis for federal jurisdiction under the statute.

## Conclusion

The Seventh Circuit held that the FDCA did not permit condemnation of the seven barrels of spray-dried whole egg because the United States did not show the seized lot had entered interstate commerce or was being held for sale after a prior interstate shipment; setting the barrels aside for a possible federal purchase subject to testing was not enough.


United States v. 7 Barrels . . . Spray Dried Whole Egg, 141 F.2d 767 (1944)