Express Stop, Inc. d/b/a Express Stop, DAB TB9317 (2025)

INITIAL DECISION AND DEFAULT JUDGMENT

Found:

• 1) Respondent violated 21 U.S.C. § 331, specifically section 906(d)(5) of the Federal Food, Drug and Cosmetic Act (Act) (21 U.S.C. § 387f(d)(5)), and 21 C.F.R. § 1140.14(a)(2)(i), as charged in the Complaint;
• 2) Respondent committed at least three violations as set forth hereinafter; and
• 3) Respondent is hereby assessed a civil penalty in the amount of $687.

Glossary:

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I. JURISDICTION

I have jurisdiction to hear this case pursuant to my appointment by the Secretary of Health and Human Services and my authority under the Administrative Procedure Act (5 U.S.C. §§ 554-556), 5 U.S.C.A. § 3106, 21 U.S.C. § 333(f)(5), 5 C.F.R. §§ 930.201 et seq. and 21 C.F.R. Part 17.2

II. PROCEDURAL BACKGROUND

The Center for Tobacco Products (CTP/Complainant) filed a Complaint on August 19, 2024, against Express Stop, Inc. d/b/a Express Stop (Respondent or Express Stop), located at 3509 Plantation Road Northeast, Roanoke, Virginia 24012.  Civil Remedies Division (CRD) Docket (Dkt.) Entry No. 1 (Complaint), 1a (Cover Letter), 1b (Proof of Service).  The Complaint alleges that FDA documented at least three violations within a 24-month period.  CRD Dkt. Entry No. 1 ¶ 1.

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Respondent was served with process on August 16, 2024, by United Parcel Service.  CRD Dkt. Entry No. 1b; see also CRD Dkt. Entry No. 2.  On August 28, 2024, Respondent timely filed its Answer to the Complaint.  CRD Dkt. Entry No. 4 (Answer).  In its Answer, Respondent denied the allegations in the Complaint, asserted a defense, and contested the civil money penalty proposed by CTP.  See id at 2-3.

On September 12, 2024, I issued a Pre-Hearing Order (PHO) which established deadlines for discovery and the parties’ pre-hearing exchanges.  CRD Dkt. Entry No. 5.

On October 15, 2024, pursuant to 21 C.F.R. § 17.23 and the PHO, CTP served Respondent with a Request for Production of Documents (RFP), which was delivered on October 16, 2024.  See CRD Dkt. Entry Nos. 7 at 1, 7a, 7b.  Respondent had ten (10) days after CTP’s RFP was served (or until October 28, 2024) to file a motion for a protective order.  21 C.F.R. §§ 17.23(d)(1), 17.28, 17.30; PHO ¶ 3.  Respondent also had thirty (30) days after CTP’s RFP was served (or until November 15, 2024), to provide responsive documents.  21 C.F.R. §§ 17.23(a); PHO ¶ 3.  On November 21, 2024, CTP filed a Motion to Compel Discovery in which CTP averred that Respondent failed to respond to its RFP, and requested that an order be entered compelling Respondent to respond to CTP’s RFP in its entirety.  See CRD Dkt. Entry No. 7 at 1-2.

On January 7, 2025, I issued an Order to Compel Discovery and Order to Show Cause to Respondent.  CRD Dkt. Entry No. 8.  In the Order, I granted CTP’s Motion to Compel Discovery, and instructed Respondent to comply with CTP’s RFP on or before January 17, 2025.  See id. at 1.  In the January 7, 2025 Order, I also explained that Respondent failed to comply with my PHO and the procedural rules governing this 

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proceeding.  See id.  In addition to ordering Respondent to comply with CTP’s RFP by January 17, 2025, I construed CTP’s Motion to Compel Discovery as a request for an Order to Show Cause, and instructed Respondent to show cause, on or before January 17, 2025, why I should not strike its answer as a sanction for failing to comply with my orders, and the rules and procedures governing the proceeding.  Id. at 1-2.

I warned: 

• Failure to comply may result in sanctions, which may include 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.    

Respondent did not provide documents responsive to CTP’s RFP, nor did Respondent file a response to my Order to Compel Discovery and Order to Show Cause to Respondent.

On January 27, 2025, CTP filed its Complainant’s Status Report and Motion to Impose Sanctions (Motion to Impose Sanctions), requesting that I strike Respondent’s Answer and issue an initial decision and default judgment imposing a civil money penalty in the amount of $687 against Respondent.  CRD Dkt. Entry No. 9 at 2.

On March 25, 2025, I issued another Order to Show Cause to Respondent.  CRD Dkt. Entry No. 10.  In the March 25, 2025 Order, I construed CTP’s Motion to Impose Sanctions as a request for an Order to Show Cause and, again, instructed Respondent to 

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comply with CTP’s RFP, and to show cause on or before April 4, 2025 why a default judgment should not be entered against it for failure to comply with the procedural rules governing this proceeding.  Id. at 1-2.  In the March 25, 2025 Order,

I warned:

• Failure to comply will result in sanctions, which may include 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. at 1 (emphasis in original).  

To date, Respondent has not provided documents responsive to CTP’s RFP.  Further, Respondent has not filed a response to CTP’s Motion to Compel Discovery, my January 7, 2025 Order to Compel Discovery and Order to Show Cause to Respondent, CTP’s Motion to Impose Sanctions, nor my March 25, 2025 Order to Show Cause to Respondent.

III. STRIKING RESPONDENT’S ANSWER

Pursuant to 21 C.F.R. § 17.35(a), I may sanction a person, including any party or counsel 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 , 

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• orderly, or fair conduct of the hearing.  

Here, Respondent failed to comply with my September 12, 2024 PHO, my January 7, 2025 Order to Compel Discovery and Order to Show Cause to Respondent, and my March 25, 2025 Order to Show Cause to Respondent.  Respondent has failed to comply with my orders and procedures governing this proceeding and failed to defend its actions.  Respondent’s misconduct has interfered with the speedy, orderly, or fair conduct of this proceeding.  21 C.F.R. § 17.35(a).  I find sanctions are appropriate pursuant to 21 C.F.R. § 17.35(a).

The harshness of the sanctions I impose upon either party must relate to the nature and severity of the misconduct or failure to comply.  21 C.F.R. § 17.35(b).  I find and conclude that Respondent’s misconduct is sufficient to warrant striking its answer and issuing a decision without further proceedings.  21 C.F.R. § 17.35(c); see 21 C.F.R. § 17.11(a).  In fact, Respondent has not been responsive in these proceedings since it filed its Answer on August 28, 2024.  See CRD Dkt. Entry No. 4.

IV. BURDEN OF PROOF

CTP as the petitioning party has the burden of proof.  21 C.F.R. § 17.33.

V. LAW

21 U.S.C. § 331, specifically section 906(d)(5) of the Act, and 21 C.F.R. § 1140.14(a)(2)(i).

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VI. ISSUE

Did Respondent violate 21 U.S.C. § 331, specifically section 906(d)(5) of the Act, 21 C.F.R. § 1140.14(a)(2)(i), as alleged in the Complaint?

VII. DEFAULT

I find Respondent was served, which Respondent did not rebut, and that Respondent is subject to the jurisdiction of this forum, as established by the Notice of Filing filed by CTP on August 20, 2024, and by Respondent’s Answer filed on August 28, 2024.  See CRD Dkt. Entry Nos. 2, 4.

As discussed above, pursuant to 21 C.F.R. § 17.35(c), Respondent’s Answer is stricken from the record.  Striking Respondent’s Answer leaves the complaint unanswered.

It is Respondent’s right to participate in the legal process.

It is Respondent’s right to request a hearing or to waive a hearing.

CTP’s Complaint being unanswered, as a result of Respondent’s Answer being stricken from the record, I find Respondent waived its right to a hearing pursuant to 21 C.F.R. §§ 17.35, 17.11(b).

VIII. ALLEGATIONS

1. A. Agency’s recitation of facts

CTP alleged that Respondent owns an establishment, doing business under the name Express Stop, located at 3509 Plantation Road Northeast, Roanoke, Virginia 24012.  

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Respondent’s establishment receives tobacco products in interstate commerce and holds them for sale after shipment in interstate commerce.

CTP’s Complaint alleged that on January 4, 2024, CTP issued a Warning Letter to Respondent, alleging that Respondent committed the following violations:

1. Selling regulated tobacco products to a person under 21 years of age, in violation of section 906(d)(5) of the Act. Specifically, a person younger than 21 years of age was able to purchase a package of Newport Box cigarettes on December 9, 2023, at approximately 10:16 AM; and
2. Failing to verify the age of a person purchasing tobacco products by means of photographic identification containing the bearer's date of birth, as required by 21 C.F.R. § 1140.14(a)(2)(i). Specifically, the underage purchaser’s age was not verified before the sale, as detailed above, on December 9, 2023, at approximately 10:16 AM.

Because no opportunity for a hearing was provided before the Warning Letter was issued, Respondent had a right to challenge the allegations in the Warning Letter in the instant case.  See Orton Motor Co. d/b/a Orton’s Bagley v. HHS, 884 F.3d 1205 (D.C. Cir. 2018).

Further, during a subsequent inspection of Express Stop conducted on May 24, 2024, an FDA-commissioned inspector documented the following violations:

1. Selling regulated tobacco products to a person under 21 years of age, in violation of section 906(d)(5) of the Act. Specifically, a person younger than 

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1. 21 years of age was able to purchase a package of Newport Box cigarettes on May 24, 2024, at approximately 7:02 PM; and
2. Failing to verify the age of a person purchasing tobacco products by means of photographic identification containing the bearer's date of birth, as required by 21 C.F.R. § 1140.14(a)(2)(i).  Specifically, the underage purchaser’s age was not verified before the sale, as detailed above, on May 24, 2024, at approximately 7:02 PM. 

Respondent’s recitation of facts

Respondent’s Answer is stricken from the record as a sanction.  21 C.F.R. § 17.35(a).  Accordingly, Respondent filed no responsive pleadings that I may consider.

IX. FAMILY SMOKING PREVENTION AND TOBACCO CONTROL ACT

The “relevant statute” in this case is actually a combination of statutes and regulations:  The Family Smoking Prevention and Tobacco Control Act, Pub. L. No. 111‑31, 123 Stat. 1776 (2009) (TCA), amended the Food, Drug, and Cosmetic Act (21 U.S.C.A. Chap. 9) (FDCA) and created a new subchapter of that Act that dealt exclusively with tobacco products, (21 U.S.C. §§ 387-387u), and it also modified other parts of the FDCA explicitly to include tobacco products among the regulated products whose misbranding can give rise to civil, and in some cases criminal, liability.  The 2009 amendments to the FDCA contained within the TCA also charged the Secretary of Health and Human Services with, among other things, creating regulations to govern tobacco sales.  The Secretary’s regulations on tobacco products appear in Part 1140 of Title 21, 

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Code of Federal Regulations.

Under the FDCA, “[a] tobacco product shall be deemed to be misbranded if, in the case of any tobacco product sold or offered for sale in any State, it is sold or distributed in violation of regulations prescribed under section 387f(d).”  21 U.S.C. § 387c(a)(7)(B) (2012).  Section 387a‑1 directed FDA to re-issue, with some modifications, regulations previously passed in 1996.  21 U.S.C. § 387 a-1(a) (2012).  These regulations were passed pursuant to section 387f(d), which authorizes FDA to promulgate regulations on the sale and distribution of tobacco products; 75 Fed. Reg. 13,225 (Mar. 19, 2010), codified at 21 C.F.R. Part 1140 (2015); 21 U.S.C. § 387f(d)(1) (2012).  Accordingly, 21 C.F.R. § 1140.1(b) provides that “failure to comply with any applicable provision in this part in the sale, distribution, and use of cigarettes and smokeless tobacco renders the product misbranded under the act.”

Under 21 U.S.C. § 331(k), “[t]he alteration, mutilation, destruction, obliteration, or removal of the whole or any part of the labeling of, or the doing of any other act with respect to, a food, drug, device, tobacco product, or cosmetic, if such act is done while such article is held for sale (whether or not the first sale) after shipment in interstate commerce and results in such article being adulterated or misbranded” is a prohibited act under 21 U.S.C. § 331.  Thus, when a retailer such as Respondent misbrands a tobacco product by violating a requirement of 21 C.F.R. Part 1140, that misbranding in turn violates the FDCA, specifically 21 U.S.C. § 331(k).  FDA may seek a civil money penalty from “any person who violates a requirement of this chapter which relates to tobacco products.”  21 U.S.C. § 333(f)(9)(A) (2012).  Penalties are set by 21 U.S.C. 

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§ 333 note and 21 C.F.R. § 17.2.  Under current FDA policy, the first time FDA finds violations of 21 C.F.R. Part 1140 at an establishment, FDA only counts one violation regardless of the number of specific regulatory requirements that were actually violated, but if FDA finds violations on subsequent occasions, it will count violations of specific regulatory requirements individually in computing any civil money penalty sought.  This policy is set forth in detail, with examples to illustrate, at U.S. Food & Drug Admin., Guidance for Industry and FDA Staff, Civil Money Penalties and No-Tobacco-Sale Orders for Tobacco Retailers, Responses to Frequently Asked Questions, (Revised) (2016), available at http://www.fda.gov/downloads/TobaccoProducts/Labeling/RulesRegulationsGuidance/UCM447310.pdf, at 13-14.  So, for instance, if a retailer sells a tobacco product on a particular occasion to an underage purchaser without checking for photographic identification, in violation of section 906(d)(5) of the Act, and subpart B of part 1140 of title 21, Code of Federal Regulations, this will count as two separate violations for purposes of computing the civil money penalty, unless it is the first time violations were observed at that particular establishment.  This policy of counting violations has been determined by the HHS Departmental Appeals Board to be consistent with the language of the FDCA and its implementing regulations, see Orton Motor Co. d/b/a Orton’s Bagley v. HHS, 884 F.3d 1205 (D.C. Cir. 2018).

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X. LIABILITY

Pursuant to 21 C.F.R. § 17.35(c), Respondent’s Answer is stricken from the record, leaving CTP’s Complaint is unanswered.  Thus, pursuant to 21 C.F.R. § 17.11(a), I assume those allegations set forth in the Complaint to be true.

I find and conclude that the evidentiary facts, by a preponderance of the evidence standard, support a finding Respondent violated 21 U.S.C. § 331, specifically section 906(d)(5) of the Act, in that a person younger than 21 years of age was able to purchase regulated tobacco products on December 9, 2023, and May 24, 2024.

I find and conclude that the evidentiary facts, by a preponderance of the evidence standard, support a finding Respondent violated 21 U.S.C. § 331, specifically 21 C.F.R. § 1140.14(a)(2)(i), on those same dates, in that 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.

The conduct set forth above on December 9, 2023, and May 24, 2024, counts as three violations for purposes of computing the civil money penalty.

When a retailer such as Respondent is found to have “misbranded” a tobacco product in interstate commerce, it can be liable to pay a CMP.  21 U.S.C. §§ 331, 333.  A retailer facing such a penalty has the right, set out in statute, to a hearing under the Administrative Procedure Act (21 U.S.C. § 333(f)(5)(A)).  A retailer can forfeit its rights under the statute and regulations by failing to participate in the process, a failure known as a “default” (21 C.F.R. § 17.11).  Respondent being in default pursuant to 21 

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C.F.R. § 17.11, I conclude Respondent’s actions constitute violations of the Act that warrants the imposition of a CMP.

XI. IMPACT OF RESPONDENT’S DEFAULT

Pursuant to 21 C.F.R. § 17.11, an ALJ must assume as true all factual allegations in the Complaint and issue an initial decision, imposing “the maximum amount of penalties provided for by law for the violations alleged” or “the amount asked for in the Complaint, whichever is smaller” if “liability under the relevant statute” is established.  21 C.F.R. § 17.11(a)(1), (2).  Compare 21 C.F.R. § 17.45 (initial decision must state the “appropriate penalty” and take into account aggravating and mitigating circumstances).

Two aspects of Rule 17.11 are important in default cases.  First, CTP benefits from a regulatory presumption (the ALJ shall assume that the facts alleged in the complaint are true) that relieves it from having to put on evidence.

The presumption affords a party, for whose benefit the presumption runs, the luxury of not having to produce specific evidence to establish the point at issue.  When the predicate evidence is established that triggers the presumption, the further evidentiary gap is filled by the presumption.  See 1 Weinstein’s Federal Evidence § 301.02[1], at 301‑7 (2d ed.1997); 2 McCormick on Evidence § 342, at 450 (John W. Strong ed., 4th ed. 1992).  Routen v. West, 142 F.3d 1434, 1440 (Fed. Cir. 1998).3

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Second, as far as the penalty is concerned, my discretion is limited by the language of the regulation.  I may not tailor the penalty to address any extenuation or mitigation, for example, nor, because of notice concerns, may I increase the penalty beyond the smaller of (a) CTP’s request or (b) the maximum penalty authorized by law.

XII. LIABILITY UNDER THE RELEVANT STATUTE

Taking the CTP’s allegations as set forth in the complaint as true, the next step is whether the allegations make out “liability under the relevant statute” (21 C.F.R. § 17.11(a)).

I find and conclude that the evidentiary facts, by a preponderance of the evidence standard, support a finding Respondent violated 21 U.S.C. § 331, specifically section 906(d)(5) of the Act, and 21 C.F.R. § 1140.14(a)(2)(i) on December 9, 2023, and May 24, 2024, for purposes of computing the civil money penalty.

XIII. PENALTY

There being liability under the relevant statute, I must now determine the amount of penalty to impose.  My discretion regarding a penalty is constrained by regulation.  I must impose either the maximum amount permitted by law or the amount requested by the Center, whichever is lower.  21 C.F.R. § 17.11(a)(1), (a)(2).

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In terms of specific punishments available, the legislation that provides the basis for assessing civil monetary penalties divides retailers into two categories:  those that have “an approved training program” and those that do not.  Retailers with an approved program face no more than a warning letter for their first violation; retailers without such a program begin paying monetary penalties with their first.  TCA § 103(q)(2), 123 Stat. 1839, codified at 21 U.S.C. § 333 note.  See 21 C.F.R. § 17.2.  The FDA has informed the regulated public that “at this time, and until FDA issues regulations setting the standards for an approved training program, all applicable CMPs will proceed under the reduced penalty schedule.”  FDA Regulatory Enforcement Manual, Aug. 2015, ¶ 5‑8‑1.  Because of this reasonable exercise of discretion, the starting point for punishments and the rate at which they mount are clear – the lower and slower schedules.

XIV. MITIGATION

It is incumbent upon Respondent to present any factors that could result in mitigation of CTP’s proposed penalty.  Specifically, it is Respondent’s burden to provide mitigating evidence.  In a default, Respondent has failed to participate and has failed to present any evidence regarding potential mitigation.  Accordingly, I have no reason to mitigate the penalty.

XV. CONCLUSION

Respondent committed three violations in a 24‑month period and so, Respondent is liable for a civil money penalty of $687.  See 21 C.F.R. § 17.2.

WHEREFORE, evidence having read and considered it be and is hereby 

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ORDERED as follows:

1. I find Respondent has been served with process herein and is subject to this forum.
2. I find Respondent failed to respond to my January 7, 2025 Order to Compel Discovery and Order to Show Cause to Respondent.
3. I find that Respondent failed to respond to my March 25, 2025 Order to Show Cause to Respondent.
4. I find Respondent failed to comply with my multiple orders and procedures governing this proceeding and failed to defend its actions, constituting misconduct that has interfered with the speedy, orderly, or fair conduct of this proceeding. 21 C.F.R. § 17.35(a).
5. I find Respondent’s misconduct warrants striking its answer as a sanction. 21 C.F.R. § 17.35(c).
6. I find striking Respondent’s answer leaves the complaint unanswered. 21 C.F.R. § 17.11.
7. I find Respondent is in default.
8. I assume the facts alleged in the complaint to be true. 21 C.F.R. § 17.11.
9. I find the facts set forth in the complaint establish liability under the relevant statute.
10. I assess a monetary penalty in the amount of $687.