Woodside Deli & Grocery, Inc. d/b/a Woodside Deli & Grocery, DAB TB9063 (2025)

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

The Food and Drug Administration, Center for Tobacco Products (CTP or Complainant) began this case by serving a Complaint on Respondent, Woodside Deli & Grocery, Inc. d/b/a Woodside Deli & Grocery, and filing a copy of the Complaint with the Departmental Appeals Board, Civil Remedies Division (CRD).  The Complaint alleges that Respondent’s staff sold regulated tobacco products to underage purchasers and failed to verify that the purchasers were 21 years of age or older, thereby violating the Federal Food, Drug, and Cosmetic Act (Act), 21 U.S.C. § 301 et seq., and its implementing regulations, 21 C.F.R. pt. 1140.  CTP seeks a civil money penalty of $6,892 for five violations of the regulations within a 36-month period.1  Respondent timely requested a 

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hearing by filing an Answer.  I issued an Acknowledgment and Pre-Hearing Order (APHO) establishing procedural deadlines for this case. 

Complainant’s Status Report and Motion to Impose Sanctions (Motion) is pending before me.  CTP’s Motion requests that I strike Respondent’s Answer as a sanction for failing to comply with CTP’s discovery requests and issue a default judgment against Respondent.  During the course of these administrative proceedings, Respondent failed to comply with multiple judicial 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).  Therefore, pursuant to 21 C.F.R. § 17.35(c)(3), I grant CTP’s Motion, strike Respondent’s Answer, and issue an Initial Decision and Default Judgment imposing a civil money penalty of $6,892.

I. Procedural History

On June 28, 2024, CTP served the Complaint and supporting documents on Respondent by United Parcel Service, pursuant to 21 C.F.R. §§ 17.5 and 17.7.  CRD Docket (Dkt.) Entry No. 1b.  Respondent timely filed its Answer to CTP’s Complaint on July 29, 2024.  CRD Dkt. Entry No. 3. 

On August 8, 2024, I issued an APHO that set deadlines for the parties’ filings and exchanges, including a schedule for discovery.  CRD Dkt. Entry No. 4.  I directed that a party receiving a discovery request must provide the requested documents within 30 days of the request.  Id. at ¶ 4; see 21 C.F.R. § 17.23(a).  Also, I warned that I may impose sanctions if a party failed to comply with any order, including the APHO.  CRD Dkt. Entry No. 4 at ¶ 21.  

On October 22, 2024, CTP filed a Motion to Extend Deadlines and a Motion to Compel Discovery asserting that Respondent did not respond to its discovery request as required by the APHO and regulations.  CRD Dkt. Entry Nos. 7a-b, 8.  By Order of October 22, 2024, I informed Respondent of its deadline to file a response to CTP’s Motion to Compel Discovery, and warned that if Respondent failed to respond, “I may grant CTP’s motion in its entirety.”  CRD Dkt. Entry No. 9 (emphasis in original); see also 21 C.F.R. § 17.32(c); APHO ¶ 20.  Additionally, I extended the pre-hearing deadlines by thirty days.  CRD Dkt. Entry No. 9 at 1-2.  CTP’s pre-hearing exchange was extended until November 27, 2024, and Respondent’s pre-hearing exchange was extended until December 27, 2024.  Id. at 2.  Respondent did not respond to the October 22, 2024, Order.

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On November 7, 2024, I issued an Order Granting Complainant’s Motion to Compel.  CRD Dkt. Entry No. 11.  Additionally, I ordered Respondent to produce documents responsive to CTP’s discovery request by November 22, 2024, and warned Respondent that:

• [F]ailure to comply with this order may result in sanctions, which may include striking [Respondent’s] Answer and issuing an Initial Decision and Default Judgment finding Respondent liable for the violations listed in the Complaint and imposing a civil money penalty of $6,892.

CRD Dkt. Entry No. 11 (emphasis in original).

Additionally, I extended CTP’s pre-hearing exchange until December 27, 2024, and Respondent’s pre-hearing exchange until January 27, 2025.  Id. at 2. 

On November 25, 2024, CTP filed a Status Report and Motion to Impose Sanctions and a Motion to Stay Deadlines.  CRD Dkt. Entry Nos. 12, 13.  CTP advised that Respondent did not produce responsive documents in compliance with my Order Granting Complainant’s Motion to Compel.  CRD Dkt. Entry No. 12 at 2.  By Order of December 4, 2024, I informed Respondent of its December 20, 2024, deadline to file a response to CTP’s motion and warned Respondent that if it failed to file a response, “I may grant CTP’s Motion to Impose Sanctions and impose the requested civil money penalty of $6,892, pursuant to 21 C.F.R. § 17.35.”  CRD Dkt. Entry No. 14 at 2 (emphasis in original).  To date, Respondent has not responded. 

II. 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).  When a party “fails to comply with a discovery order,” I may draw an inference in favor of the opposing party, may prohibit the non-complying party from introducing or relying on evidence related to the discovery request, and may “[s]trike any part of the pleadings or other submissions of the party failing to comply with [the discovery] request.” 21 C.F.R. § 17.35(c). Any sanction “shall reasonably relate to the severity and nature of the failure or misconduct.” 21 C.F.R. § 17.35(b).

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I conclude that sanctions against Respondent are warranted.  Respondent repeatedly failed to comply with the following orders and procedures governing this proceeding:

• Respondent failed to comply with 21 C.F.R. § 17.23(a) and paragraph 4 of the APHO, when Respondent failed to respond to CTP’s Request for Production of Documents within 30 days; and
• Respondent failed to comply with my November 7, 2024, Order Granting Complainant’s Motion to Compel when it failed to submit (or indicate that it did not have) documents responsive to CTP’s Request for Production of Documents by November 22, 2024. 

Respondent also repeatedly failed to defend its action by failing to respond to CTP’s Motion to Compel Discovery and Motion to Impose Sanctions, despite my October 22, 2024, and December 4, 2024, orders informing Respondent of such opportunities and warning of consequences.  21 C.F.R. § 17.35(a)(2).  Respondent’s failure to fulfill its discovery obligations and respond to CTP’s various motions suggests that Respondent has abandoned its defense of this case. 

Further, Respondent’s failure to comply with the orders, regulations governing discovery, and other procedures in this case delayed the hearing process.  To provide ample opportunity for Respondent to respond to CTP’s motions and for the parties to prepare their respective pre-hearing exchanges, my October 22, 2024, and November 7, 2024, orders extended the initial pre-hearing deadlines set in the APHO.  Subsequently, all deadlines were stayed by my December 4, 2024, order to give Respondent an opportunity to file a response to CTP’s Motion to Impose Sanctions. 

I find that Respondent failed to comply with multiple judicial orders and procedures governing this proceeding, failed to defend its case, and, as a result, interfered with the speedy, orderly, or fair conduct of this proceeding.  In the absence of any explanation from Respondent, I find no basis to excuse Respondent’s repeated failure to comply with the various orders and regulations in this administrative proceeding.  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 a regulation governing this proceeding.  Respondent also failed to comply with four of my orders, despite my explicit warnings that its failure could result in sanctions.  I specified in the November 22, 2024, and December 4, 2024, orders that those sanctions may include “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. 4 at ¶ 21; CRD Dkt. No. 14 at 2.  Respondent also 

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failed to defend its actions, despite my orders expressly reminding Respondent of the opportunity to do so.  Respondent’s repeated misconduct interfered with the speedy, orderly, or fair conduct of this proceeding. 

I find that Respondent’s actions are sufficient to warrant striking its Answer and issuing a decision by default, without further proceedings.  21 C.F.R. § 17.35(b), (c)(3).  Although striking an answer is a harsh sanction, the Departmental Appeals Board has repeatedly held in similar circumstances involving a Respondent’s repeated failure to comply with discovery and procedural orders that “the ALJ determination to impose sanctions was not an abuse of discretion, and the sanction imposed was reasonably related to the nature and severity of Respondent’s noncompliance.”  Carolina Cigar of Delray, LLC d/b/a Carolina Cigar, DAB No. 3134, at 11 (2024) (citing Joshua Ranjit, Inc. d/b/a 7-Eleven 10326, DAB No. 2758, at 1, 8-11; KKNJ, Inc. d/b/a Tobacco Hut at 8-11 (2016); and Retail LLC d/b/a Super Buy Rite, DAB No. 2660, at 10-14 (2015)).  Accordingly, I grant CTP’s Motion to Impose Sanctions, strike Respondent’s Answer, and issue this Initial Decision and Default Judgment, assuming the facts alleged in CTP’s Complaint to be true.  21 C.F.R. §§ 17.35(c)(3), 17.11(a). 

III. 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).  Pursuant to 21 C.F.R. § 17.11(a), I must “assume the facts alleged in the [C]omplaint to be true” and, if those facts establish liability under the Act, issue a default judgment imposing the “maximum amount of penalties provided for by law for the violations alleged” or the civil money penalty “amount asked for in the complaint, whichever is smaller.”  Id.  Accordingly, I must determine whether the allegations in the Complaint establish violations of the Act. 

Specifically, CTP alleges the following facts in its Complaint:

• Respondent owns Woodside Deli & Grocery, an establishment that sells tobacco products and is located at 7702 Woodside Avenue, Elmhurst, New York 11373.  Complaint ¶¶ 11-12.
• On August 23, 2023, CTP initiated the first civil money penalty action, CRD Docket Number T-23-3437, FDA Docket Number FDA-2023-H-3589, against Respondent for violations of the Act and 21 C.F.R. pt. 1140.  Specifically, CTP alleged two violations for selling tobacco products to an underage purchaser and two violations for failing to verify the age of a person with photographic identification on each of the following dates:  December 10, 2022, and June 7, 2023.  Complaint ¶ 15.  

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• The previous action concluded when an Initial Decision and Default Judgment was entered by an Administrative Law Judge, “finding that all of the violations alleged in the Complaint occurred.”  Complaint ¶ 16.
• At approximately 6:36 PM on April 3, 2024, at Respondent’s business establishment, 7702 Woodside Avenue, Elmhurst, New York 11373, an FDA commissioned inspector conducted a subsequent inspection.  During this inspection, a person younger than 21 years of age was able to purchase a package of five Backwoods Sweet Aromatic cigars.  Additionally, Respondent’s staff failed to verify, by means of photographic identification containing a date of birth, that the purchaser was 21 years of age or older.

These facts establish that Respondent is liable under the Act.  The Act prohibits misbranding of a tobacco product.  21 U.S.C. § 331(k).  A tobacco product is misbranded if sold or distributed in violation of regulations issued under section 906(d) of the Act.  21 U.S.C. § 387c(a)(7)(B); 21 C.F.R § 1140.1(b).  The Secretary of the U.S. Department of Health and Human Services issued the regulations at 21 C.F.R. pt. 1140 under section 906(d) of the Act.  21 U.S.C. § 387a-1; see 21 U.S.C. § 387f(d)(1); 75 Fed. Reg. 13,225, 13,229 (Mar. 19, 2010); 81 Fed. Reg. 28,974, 28,975-76 (May 10, 2016); 89 Fed. Reg. 70,483, 70,485 (Aug. 30, 2024).  Section 906(d)(5) of the Act prohibits the sale of regulated tobacco products to any person younger than 21 years of age, and requires retailers to verify, by means of photographic identification containing a purchaser’s date of birth, that no regulated tobacco product purchaser is younger than 21 years of age. 

Taking the above alleged facts as true, Respondent violated the prohibition against selling regulated tobacco products to persons younger than 21 years of age on December 10, 2022, June 7, 2023, and April 3, 2024.  Act § 906(d)(5).  On those same dates, Respondent also violated the requirement that retailers verify, by means of photo identification containing a purchaser’s date of birth, that no regulated tobacco product purchasers are younger than 21 years of age.  Id.  All violations observed during the initial failed inspection are counted as a single violation, and each separate violation observed during subsequent failed inspections count as a discrete violation.  Orton Motor, Inc. d/b/a Orton’s Bagley v. U.S. Dep’t of Health & Human Serv., 884 F.3d 1205 (D.C. Cir. 2018).  Accordingly, Respondent had three violations from the previous civil money penalty action and two additional violations on April 3, 2024.  Therefore, Respondent’s actions constitute five violations of law within a 36-month period that merit a civil money penalty.

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CTP has requested a civil money penalty of $6,892, which is less than the maximum penalty of $7,115 under the regulations.  21 C.F.R. §§ 17.2, 17.11; see also 45 C.F.R. § 102.3.  Therefore, I find that a civil money penalty of $6,892 is warranted and so order one imposed.