Two former executives of Acclarent, Inc., a medical device company, were convicted on misdemeanor charges by a federal jury in connection with distributing adulterated and misbranded medical devices.

William Facteau, 47, of Atherton, California, and Patrick Fabian, 49, of Lake Elmo, Minnesota, were convicted by a jury following a six week trial of 10 counts of introducing adulterated and misbranded medical devices into interstate commerce.

The jury concluded that Facteau and Fabian caused the unlawful distribution of a medical device known as the Relieva Stratus Microflow Spacer for uses not cleared or approved by the U.S. Food and Drug Administration.

Despite the fact that the company had told the FDA that the Stratus was a medical device intended to maintain an opening to a patient’s sinus, Facteau and Fabian launched the product intending it to be used as a steroid delivery device.

The FDA, however, had specifically refused Acclarent’s request to clear the Stratus for marketing as a drug delivery device without further submissions to support that use.

“The goal of the Department of Justice is to change corporate behavior at the executive level, and it won’t take too many positive jury decisions to do that,” said Patrick Burns of Taxpayers Against Fraud.  “Every time there’s talk of individual accountability, whether the punishment is jail time, individual exclusion, claw backs, or fines, anxiety rises to a fever pitch in the C-suites.”

“For pharmaceutical companies this is litigation Russian Roulette,” Burns said. “Even if the Department fires blanks six times out of seven, and even if they only put a bullet in the foot on the seventh shot, do pharma executives want to play knowing they are going to limp for life?  A conviction is a conviction, and for these two defendants this history is not going away. Google is forever.”

Federal officials alleged that Facteau and Fabian sought to quickly develop and market products, including the Stratus as a drug delivery device, to create a projected revenue stream that would make Acclarent an attractive business for either an initial public offering or acquisition.

Lawyers for Facteau and Fabian claimed victory in that the two were acquitted of all 14 felony charges brought by the government.

Steptoe’s Reid Weingarten, lead lawyer for Facteau, and Frank Libby of Libby Hoopes, PC, lead lawyer for Fabian, immediately informed the court that the defendants would move to set aside the misdemeanor charges on multiple grounds.

“I am grateful that the jury exonerated Mr. Facteau of all charges requiring criminal intent and affirmatively concluded that the case did not involve false or misleading statements,” Weingarten said. “It is difficult to understand how someone in America could be convicted of even misdemeanor crimes without a finding of intentional wrongdoing. We will fight vigorously to overturn these few remaining charges and will not rest until Mr. Facteau is completely vindicated.”

Libby said that after five years of investigation and a six week trial, “the jury flatly rejected the government’s core fraud and conspiracy theories. We’re completely confident that, during the proceedings to come, the remaining ‘no wrongful intent’ misdemeanor counts of conviction will meet the same fate.”

Both counsel stated that future motions would include the lack of due process associated with the non-intent misdemeanor convictions, and the fact that the instructions received by the jury permitted the defendants to be convicted based on truthful, non-misleading statements by sales personnel, in violation of the First Amendment and recent court of appeals decisions.

(Story amended July 25, 2016.)