Riggs Road Sunoco LLC d/b/a Shell, DAB TB9227 (2025)

ORDER IMPOSING SANCTIONS AND INITIAL DECISION AND DEFAULT JUDGMENT

The Center for Tobacco Products (CTP) filed an Administrative Complaint (Complaint) against Respondent, Riggs Road Sunoco LLC d/b/a Shell, alleging facts and legal authority sufficient to justify imposing a civil money penalty of $687.  The Complaint alleges that Respondent impermissibly sold regulated tobacco products to persons under the legal age and failed to verify that purchasers were of sufficient age, thereby violating the Federal Food, Drug, and Cosmetic Act (Act), 21 U.S.C. § 301 et seq., and its implementing regulations, Cigarettes and Smokeless Tobacco, 21 C.F.R. pt. 1140.  CTP seeks a civil money penalty of $687.

During the course of these administrative proceedings, Respondent failed to comply with 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).  Accordingly, pursuant to 21 C.F.R. § 17.35, I strike Respondent’s Answer and issue this decision of default judgment.

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I. Procedural History

On August 1, 2024, CTP served the Complaint on Respondent, located at 5801 Riggs Road, Hyattsville, Maryland 20783, 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), and 1b (Proof of Service).  On September 3, 2024, CRD received Respondent’s timely filed Answer.  CRD Dkt. Entry Nos. 3- 4a.  In its Answer, Respondent denied the allegations and claimed a financial hardship.  CRD Dkt. Entry No. 3.

On September 9, 2024, I issued an Acknowledgment and Pre-Hearing Order (APHO) establishing procedural deadlines for this case.  CRD Dkt. Entry No. 5.  The APHO ordered the parties to serve requests for documents no later than October 11, 2024, and ordered the parties receiving the request to provide the requested documents no later than 30 days after the request was made.  Id. ¶ 4.  Further, the APHO warned the parties that “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.”  Id. ¶ 21, citing 21 C.F.R. § 17.35.

On November 15, 2024, CTP filed a Motion to Compel Discovery and a Motion to Extend Deadlines.  CRD Dkt. Entry Nos. 8, 9.  CTP stated that it served its Request for Production of Documents, (RFP), on Respondent on October 10, 2024, but CTP had not received a response.  CRD Dkt. Entry No. 8 at 1.  On November 19, 2024, I issued an Order instructing Respondent to file a response to CTP’s Motion to Compel Discovery by December 4, 2024.  CRD Dkt. Entry No. 10.  Respondent was warned “that if it fail[ed] to respond, I may grant CTP’s motion in its entirety.”  Id. at 2.

On December 13, 2024, as Respondent had not responded to CTP’s Motion to Compel Discovery, as instructed, I issued an Order granting CTP’s Motion to Compel Discovery and gave Respondent until January 13, 2025, to comply with CTP’s RFP.  CRD Dkt. Entry No. 11 at 1.  Respondent was again warned that:

Failure to do so 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.

Id.

On January 14, 2025, CTP filed Complainant’s Status Report and Motion to Impose Sanctions.  CRD Dkt. Entry No. 12.  In its Status Report and Motion to Impose Sanctions, CTP advised that Respondent did not produce responsive documents in compliance with the December 13, 2024 Order Granting Motion to Compel Discovery.  Id. at 1-2.  Also on

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January 14, 2025, CTP filed a Motion to Stay Deadlines pending the resolution of its Motion to Impose Sanctions.  CRD. Dkt. Entry No. 13.  On January 16, 2025, I issued an Order giving Respondent until January 30, 2025 to respond to CTP’s Motion to Impose Sanctions and stayed all deadlines as requested.  CRD Dkt. Entry No. 14.  My January 16, 2025 Order also warned Respondent that if it failed to file a response, “I may grant CTP’s motion in its entirety.”  Id. at 2.

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).

Respondent 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 September 9, 2024 APHO, when it failed to respond to CTP’s Request for Production of Documents within 30 days; and
• Respondent failed to comply with the December 13, 2024 Order Granting Motion to Compel Discovery, requiring Respondent to comply with CTP’s Request for Production of Documents by January 13, 2025.

Respondent also failed to defend its action.  21 C.F.R. § 17.35(a)(2).  Specifically, Respondent failed to file a response to the November 19, 2024 Order, giving it an opportunity to respond to CTP’s Motion to Compel Discovery, and failed to file a response to my January 16, 2025 Order, giving it an opportunity to file a response to CTP’s Motion to Impose Sanctions.  This leads me to conclude that Respondent has abandoned its defense of this case.

In the absence of any explanation from Respondent, I find no basis to excuse Respondent’s repeated failure to comply with various Orders in this administrative proceeding.  Despite explicit warnings that failure to comply with Orders could result in sanctions, Respondent did not comply with two Orders.  See CRD Dkt. Entry Nos. 5; 14.  Accordingly, I find that Respondent failed to comply with judicial orders and procedures governing this proceeding, failed to defend its case, and, as a result, engaged in a pattern of misconduct that interfered with the speedy, orderly, and fair conduct of the hearing.

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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).

I find that Respondent’s actions are sufficiently egregious and warrant striking its Answer and issuing a decision by default, without further proceedings.  21 C.F.R. § 17.35(b), (c)(3); see also KKNJ, Inc. d/b/a Tobacco Hut 12, DAB No. 2678 at 6, 10 (2016) (concluding that “the ALJ [Administrative Law Judge] did not abuse her discretion in sanctioning Respondent’s ongoing failure to comply with the ALJ’s directions by striking Respondent’s answer to the Complaint.”).

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 am required to “assume the facts alleged in the [C]omplaint to be true” and, if those facts establish liability under the Act, issue a default judgment and impose a civil money penalty.

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 Shell, an establishment that sells tobacco products and is located at 5801 Riggs Road, Hyattsville, Maryland 20783.  Complaint ¶¶ 11-12.
• An FDA-commissioned inspector conducted an inspection of Respondent’s establishment on May 14, 2022, at approximately 1:17 PM, during which “a person younger than 21 years of age was able to purchase a JUUL Menthol e-liquid product . . . .”  Additionally, “the underage purchaser’s age was not verified before the sale . . . .”  Complaint ¶ 15.
• On June 28, 2022, CTP issued a Warning Letter to Respondent regarding the May 14, 2022 inspection.  The letter explained that the inspector documented violations of federal law, and that the named violations were not necessarily intended to be an exhaustive list of all violations at the establishment.  The Warning Letter also stated that if Respondent failed to correct the violations, regulatory action by the FDA or a civil money penalty action could occur and that it is Respondent’s responsibility to comply with the law.  Complaint ¶¶ 15-16.
• An FDA-commissioned inspector conducted a subsequent inspection of Respondent’s establishment on May 6, 2024, at approximately 1:41 PM, during which “a person younger than 21 years of age was able to purchase a

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• JUUL Menthol e-liquid product . . . .”  Additionally, “the underage purchaser’s age was not verified before the sale . . . .”  Complaint ¶ 13.

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 distributed or offered for sale in any state 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; 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).  Under section 906(d)(5) of the Act, no retailer may sell regulated tobacco products to any person younger than 21 years of age and retailers must verify, by means of photographic identification containing a purchaser’s date of birth, that no regulated tobacco product purchasers are 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 May 14, 2022 and May 6, 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.  Therefore, Respondent’s actions constitute violations of law that merit a civil money penalty.

CTP has requested a civil money penalty of $687, which is a permissible penalty for three1 violations of the regulations found at 21 C.F.R. pt. 1140 within a 24-month period.  21 C.F.R. § 17.2.  Therefore, I find that a civil money penalty of $687 is warranted and so order one imposed.