Robert Abbott d/b/a The Vaporium, DAB 9056 (2025)

ORDER GRANTING CTP’S MOTION TO IMPOSE SANCTIONS AND INITIAL DECISION AND DEFAULT JUDGMENT

On June 12, 2024, the Center for Tobacco Products (CTP) served an Administrative Complaint (Complaint) on Respondent, Robert Abbott d/b/a The Vaporium, at 1402 North 8th Street, Pekin, Illinois 61554.  A copy of the Complaint was also filed with the Food and Drug Administration’s (FDA) Division of Dockets Management on June 12, 2024.  CTP seeks to impose a $20,678 civil money penalty against Respondent for impermissibly manufacturing, selling, and/or distributing new tobacco products that lacked the required premarketing authorization, thereby violating the Federal Food, Drug, and Cosmetic Act (Act), 21 U.S.C. §§ 301 et seq.

Respondent, through counsel, timely filed an answer to the Complaint in this matter. Since filing the answer, however, Respondent failed to comply with orders and procedures governing this proceeding and failed to defend its actions, which interfered with the speedy, orderly, or fair conduct of this proceeding.  21 C.F.R. § 17.35(a).

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Currently, CTP’s Status Report and Motion to Impose Sanctions (Motion to Impose Sanctions) is pending before me.  CTP’s Motion to Impose Sanctions requests that I strike Respondent’s Answer as a sanction for failing to respond to CTP’s discovery requests and issue a default judgment against Respondent.  After carefully considering the entire record, I grant CTP’s Motion to Impose Sanctions, strike Respondent’s Answer, and issue this default decision, pursuant to the provisions of 21 C.F.R. § 17.35(c)(3).

Procedural History

On June 12, 2024, CTP served a Complaint and supporting documents on Respondent by United Parcel Service, pursuant to 21 C.F.R. §§ 17.5 and 17.7.  Civil Remedies Division (CRD) Docket (Dkt.) Entry Nos. 1 (Complaint), 1a (Cover Letter), 1b (Proof of Service).  On July 9, 2024, Respondent, through counsel, filed a timely Answer to CTP’s Complaint through the Departmental Appeals Board (DAB) electronic filing system (E-File).1   CRD Dkt. Entry No. 3.  In its Answer, Respondent denied some of the allegations, specifically paragraphs 14 and 17 of the Complaint; asserted a defense; and stated that the civil money penalty was too high.  Id.

On July 16, 2024, I issued an Acknowledgment and Pre-Hearing Order (APHO) that set deadlines for the parties’ filings and exchanges, including a schedule for discovery.  CRD Dkt. Entry No. 5, ¶¶ 1-6.  A deadline of August 19, 2024 was established for the parties to request documents from the opposing party.  APHO ¶ 4; see also 21 C.F.R. § 17.23(a).  The APHO explained that a party must provide the requested documents no later than 30 days after the request has been made.  The APHO also explained that a party may file a motion for a protective order with CRD within 10 days of receiving a request for the production of documents.  Id.; see also 21 C.F.R. §§ 17.23(a),(d).  I also warned:

I may impose sanctions including, but not limited to, dismissal of the complaint or answer, if a party fails to comply with any order (including this order), fails to prosecute or defend its case, or engages in misconduct that interferes with the speedy, orderly, or fair conduct of the hearing.  21 C.F.R. § 17.35.

APHO ¶ 21.

The APHO also set filing deadlines for pre-hearing exchanges.  APHO ¶ 6.  CTP’s deadline to file its pre-hearing exchange and serve a copy on Respondent was October 7, 2024, and Respondent’s deadline to file its pre-hearing exchange and serve a copy on CTP was October 28, 2024.  Id.

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On August 19, 2024, CTP filed a Status Report, advising that the parties were unable to reach a settlement and that “absent an executed settlement agreement, [CTP]  intends to proceed to a hearing”.  CRD Dkt. Entry No. 7 at 1.

On September 24, 2024, CTP filed a Motion to Compel Discovery stating Respondent failed to respond to CTP’s Request for Production of Documents (RFP), which was served on August 16, 2024.  CRD Dkt. Entry No. 9; see also CRD Dkt. Entry Nos. 9a, 9b (CTP Exhibit A and Exhibit B).  In its Motion, CTP requested that I issue an order compelling “Respondent to respond to CTP’s Request for Production of Documents in its entirety.”  Id. at 2.  Contemporaneously, CTP filed an Unopposed Motion to Extend Deadlines, requesting that the deadlines for the parties’ pre-hearing exchanges also be extended by 30 days.  CRD Dkt. Entry No. 10.

On September 27, 2024, I issued an Order in which I granted CTP’s Motion to Extend Deadlines, extending the deadline for CTP’s pre-hearing exchange until November 6, 2024 and Respondent’s deadline until November 27, 2024.  CRD Dkt. Entry No. 11 at 2.  In that same Order, I ordered Respondent to file a response to CTP’s Motion to Compel Discovery by October 14, 2024.  Id.  Respondent did not file a response to my order or CTP’s Motion to Compel Discovery.

On November 4, 2024, I issued an Order Granting CTP’s Motion to Compel Discovery and ordered Respondent to produce responsive documents to CTP’s Request for Production of Documents by November 15, 2024.  I warned:

Failure to comply with this Order may result in sanctions, including the issuance of an Initial Decision and Default Judgment finding Respondent liable for the violations listed in the Complaint and imposing a civil money penalty.

CRD Dkt. Entry No. 13 at 2.

In my Order, sua sponte, I also extended the parties’ pre-hearing exchange deadlines by an additional 30 days.  CTP’s pre-hearing exchange deadline was extended to December 6, 2024, and Respondent’s pre-hearing exchange deadline to December 27, 2024.  Id.

On November 18, 2024, Respondent, through counsel, filed a Motion to Extend Discovery Deadline (Motion to Extend), stating that the parties “hav[e] been discussing and addressing the issues of discovery . . . .”  CRD Dkt. Entry No. 14, at 1.  By Order dated November 21, 2024, I denied Respondent’s Motion to Extend, expressly noting Respondent’s failure to comply with my Order Granting Motion to Compel Discovery and providing the requested documents by November 15, 2024, then filing the instant motion to extend three days after the discovery deadline.  CRD Dkt. Entry No. 15.

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On November 26, 2024, CTP filed a Status Report and Motion to Impose Sanctions.  CRD Dkt. Entry No. 16.  CTP advised that Respondent had not complied with the APHO or the November 4, 2024 Order Granting CTP’s Motion to Compel Discovery.  Id. at 1-2.  CTP argued that sanctions against Respondent for its repeated non-compliance are an appropriate remedy.  Specifically, CTP asked that I strike Respondent’s Answer as a sanction and issue an Initial Decision and Default Judgment finding Respondent liable for the violations listed in the Complaint and impose a $20,678 civil money penalty.  Id. at 2.   CTP also contemporaneously filed a Motion to Stay Deadlines.  CRD Dkt. Entry No. 17.

On December 2, 2024, I issued an Order, staying the parties’ prehearing exchange deadlines, pending resolution of CTP’s Motion to Impose Sanctions.  CRD Dkt. Entry No. 18.  Respondent was given until December 17, 2024 to file a response to CTP’s Motion to Impose Sanctions.  Again, I warned that if Respondent failed to respond, “I may grant CTP’s motion in its entirety.”  Id. at 3. To date, Respondent has not submitted a response to my Order or CTP’s Motion to Impose Sanctions. 

I. Striking Respondent’s Answer

I may sanction a party for:

(1) Failing to comply with an order, subpoena, rule, or procedure governing the proceeding;
(2) Failing to prosecute or defend an action; or 
(3) Engaging in other misconduct that interferes with the speedy, orderly, or fair conduct of the hearing.

21 C.F.R. § 17.35(a).

Respondent failed to comply with multiple judicial orders and directives.  Specifically, Respondent failed to comply with the discovery requirements of the applicable regulations and the APHO, both of which require the parties to produce documents within 30 days of a discovery request or to seek a protective order.  21 C.F.R. § 17.23(a); APHO ¶ 4.  Respondent has not provided the requested documents or requested a protective order.  Respondent failed to comply with my November 4, 2024 Order Granting Motion to Compel Discovery, which directed Respondent to comply with CTP’s RFP by November 15, 2024.  Respondent did not produce any documents or indicate that it did not have any responsive documents.  Accordingly, Respondent has failed to fulfill its discovery obligations and to comply with the regulations and orders governing this case.  21 C.F.R. § 17.35(a)(1). 

I also find that Respondent failed to defend this action.  21 C.F.R. § 17.35(a)(2).  Respondent did not file a response to CTP’s Motion to Compel Discovery, subsequent

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to my September 27, 2024 Order.  21 C.F.R. § 17.32(c).  Likewise, Respondent did not file a response to CTP’s Motion to Impose Sanctions, which was afforded in my December 2, 2024, Order.  Respondent’s failure to respond to CTP’s motions and fulfill its discovery obligations establishes that it has abandoned its defense of this case.  Respondent received ample notice of the consequences of a failure to timely respond.  Despite these warnings, as noted above, Respondent has not participated in the defense of this action in any meaningful fashion since filing its Answer.  Although Respondent, through counsel, filed a motion to extend the discovery deadline, the motion was untimely.

In sum, I find that Respondent failed to comply with orders and procedures governing this proceeding, failed to defend its case, and, as a result, interfered with the speedy, orderly, and fair conduct of this proceeding.  Therefore, I conclude that Respondent’s conduct establishes a basis for sanctions pursuant to 21 C.F.R. § 17.35, and that sanctions are warranted.

The harshness of the sanctions I impose must relate to the nature and severity of the misconduct or failure to comply.  21 C.F.R. § 17.35(b).  Here, Respondent failed to comply with regulatory requirements and two judicial orders, despite explicit warnings that its failure to do so could result in sanctions.  CRD Dkt. Entry No. 13 at 2; see also APHO ¶ 21.  Respondent’s repeated failure to respond interfered with the speedy, orderly, or fair conduct of this proceeding.  As such, I find that Respondent’s actions are sufficiently egregious to warrant striking its Answer and issuing a decision by default, without further proceedings.  21 C.F.R. § 17.35(b), (c)(3).

II. Default Decision

Striking Respondent’s Answer leaves the Complaint unanswered.  Therefore, I am required to issue an initial decision by default, provided that the Complaint is sufficient to justify a penalty.  21 C.F.R. § 17.11(a).  Accordingly, I must determine whether the allegations in the Complaint establish violations of the Act.

For the purposes of this decision, I assume the facts alleged in the Complaint to be true, pursuant to the provisions of 21 C.F.R. § 17.11(a).  Specifically:

• Respondent manufactures tobacco products and sells them through its establishment that does business under the name The Vaporium, located at 1402 North 8th Street, Pekin, Illinois 61554.  Complaint ¶ 14.
• Respondent receives at least one component that it uses to manufacture its tobacco products from outside of Illinois.  Complaint ¶ 15.
• On March 19, 2021, although there is no statutory requirement for FDA to do so, CTP issued a warning letter to Respondent, stating that, among other things, the

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new tobacco products that Respondent manufactures, sells, and/or distributes are adulterated and misbranded because they lacked the required FDA marketing authorization order.  Complaint ¶ 16.

• On February 24, 2024, an FDA-commissioned inspector conducted an inspection of The Vaporium, located at 1402 North 8th Street, Pekin, Illinois 61554.  During this inspection, the inspector observed components used to make e-liquid products that Respondent sells at its establishment.  Complaint ¶ 17.
• Respondent’s e-liquid products are “new tobacco products” because they were not commercially marketed in the United States as of February 15, 2007.  Complaint ¶ 18.
• Respondent’s e-liquid products do not have a substantial equivalence order or found-exempt order in effect.  Accordingly, they are required by 21 U.S.C. § 387j(a) to have premarket review.  Complaint ¶ 19.
• Respondent did not submit a premarket tobacco product application to FDA for its e-liquid products.  Complaint ¶ 20.
• Respondent’s e-liquid product does not have an order permitting marketing of the new tobacco product in effect under 21 U.S.C. 387j(c)(1)(A)(i) and it is therefore, adulterated under 21 U.S.C. § 387b(6)(A).  Complaint ¶ 21.
• Neither a substantial equivalence report nor an abbreviated report has been submitted for Respondent’s e-liquid products, and they are, therefore, misbranded under 21 U.S.C. § 387c(a)(6).  Complaint ¶ 22.
• Respondent’s failure to obtain the required premarket authorization for its new tobacco products causes them to become adulterated and misbranded while they are held for sale after shipment of one or more of their components in interstate commerce, in violation of 21 U.S.C. § 331(k).  Complaint ¶ 23.

These facts establish Respondent’s liability under the Act.  The Act prohibits adulterating or misbranding of a regulated tobacco product while it is held for sale after shipment of one or more of its components in interstate commerce. 21 U.S.C. § 331(k). A tobacco product is adulterated if it has not obtained the required premarket authorization.  21 U.S.C. § 387b(6)(A).  Under 21 U.S.C. § 387j(a)(2)(A), premarket authorization is required for a “new tobacco product.” A “new tobacco product” is defined as any tobacco product that was not commercially marketed in the United States as of February 15, 2007, or any modification of a tobacco product where the modified product was commercially marketed in the United States after February 15, 2007.  21 U.S.C. § 387j(a)(1).

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Respondent’s new tobacco products were not commercially marketed in the United States as of February 15, 2007, and Respondent’s new tobacco products did not have an order permitting marketing of a new tobacco product under 21 U.S.C. § 387j(c)(1)(A)(i).  Thus, Respondent’s new tobacco products lacked the required premarketing authorization and, therefore, are adulterated.  21 U.S.C. § 387b(6)(A). 

A “new tobacco product” is exempt from this premarket authorization requirement only if there is a substantial equivalence or a found exempt order in effect for such product.  21 U.S.C. §§ 387j(a)(2)(A), 387e(j)(3)(A).  Neither a substantial equivalence report nor an abbreviated report was submitted for Respondent’s new tobacco products, making them misbranded under 21 U.S.C. § 387c(a)(6).  As a result, Respondent impermissibly held for sale adulterated or misbranded new tobacco products, in violation of 21 U.S.C. § 331(k).  See also 21 U.S.C. § 387c(a)(7)(B); 21 C.F.R. § 1140.1(b).

Taking the above alleged facts as true, on February 24, 2024, Respondent violated the Act’s prohibition against adulterating or misbranding a regulated tobacco product while it is held for sale after shipment of one or more of its components in interstate commerce.  21 U.S.C. 331(k); see also 21 U.S.C. § 387b(6)(A), 21 U.S.C. §§ 387j(a)(2)(A), 387e(j)(3)(A).  Therefore, Respondent’s action constitutes violation of law that warrants a civil money penalty.  

CTP has requested a civil money penalty of $20,678, which is a permissible penalty under 21 U.S.C. § 333(f)(9)(A) and 21 C.F.R. § 17.2.  See also 45 C.F.R. § 102.3.  Therefore, I find that a civil money penalty of $20,678 is warranted and impose a penalty in that amount against Respondent.

Order

For the reasons stated above, I enter default judgment and impose a civil money penalty against Respondent, Robert Abbott d/b/a The Vaporium in the amount of $20,678.  Pursuant to 21 C.F.R. § 17.11(b), this order becomes final and binding upon both parties after 30 days of the date of its issuance.