Rippy's Companies, Inc. d/b/a Rippys Liquor and Marketplace, DAB TB9459 (2025)

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

The Center for Tobacco Products (CTP) began this matter by serving an Administrative Complaint (Complaint) on Respondent, Rippy’s Companies, Inc. d/b/a Rippys Liquor and Marketplace, at 4158 South County Trail, Charlestown, Rhode Island 02813, and by filing a copy of the Complaint with the Food and Drug Administration’s (FDA) Division of Dockets Management.  The Complaint alleges that Rippys Liquor and Marketplace impermissibly sold regulated tobacco products to underage purchasers and failed to verify, by means of photo identification containing a date of birth, 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. Part 1140. 

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CTP seeks a civil money penalty of $687 against Rippys Liquor and Marketplace, for at least three1 violations within 24-month period.2

Respondent filed an Answer to the Complaint in this matter.  However, during the course of this administrative proceeding, Respondent failed to comply with multiple judicial orders and directives and failed to defend its case, which interfered with the speedy, orderly, or fair conduct of this proceeding.  21 C.F.R. § 17.35(a). 

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), 17.35(e).

I. Procedural History

As provided for in 21 C.F.R. §§ 17.5 and 17.7, on October 10, 2024, CTP served the Complaint on Respondent by United Parcel Service.  Civil Remedies Division (CRD) Docket (Dkt.) Entry Numbers (Nos.) 1 (Complaint), 1b (Proof of Service).  On November 9, 2024, Respondent through counsel (Respondent) filed a timely Answer to CTP’s Complaint denying the allegations.  CRD Dkt. Entry No. 3.  On November 13, 2024, I issued an Acknowledgement and Pre‑Hearing Order (APHO) that set deadlines for the parties’ filings and exchanges, including a schedule for discovery.  CRD Dkt. Entry No. 4.  In the APHO, I directed that a party receiving a discovery request must provide the requested documents within 30 days of the request.  APHO ¶ 4; see also 21 C.F.R. § 17.23(a).  The APHO 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.

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APHO ¶ 21.

On December 13, 2024, in compliance with the APHO ¶ 3, CTP timely filed its status report and a notice of appearance.  CRD Dkt. Entry Nos. 5, 6.  The status report indicated the parties intended to engage in further settlement discussions and would notify the Departmental Appeals Board (DAB) if the parties agreed to a settlement and Respondent fulfilled the terms of the settlement agreement.  Id.

On January 22, 2025, CTP timely filed a Motion to Compel Discovery, asserting that Respondent did not respond to its discovery request as required by my APHO and regulations.  CRD Dkt. Entry No. 7.  On the same date, CTP also filed a Motion to Extend Deadlines requesting a 30-day extension of “any deadlines, including February 3, 2025, due date for CTP’s pre-hearing exchange . . . .”  CRD Dkt. Entry No. 8 at 2. 

On January 24, 2025, I issued an Order advising Respondent that it had until February 13, 2025, to file a response to CTP’s Motion to Compel Discovery.  CRD Dkt. Entry No. 9.  I also warned that if Respondent failed to respond, “I may grant CTP’s motion in its entirety.”  Id. at 2; see also APHO ¶¶ 20-21; 21 C.F.R. § 17.32(c).  In my Order, I also extended the pre-hearing exchange deadlines.  Id. 

On February 28, 2025, 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 March 17, 2025, to comply with CTP’s Request for Production of Documents.  CRD Dkt. Entry No. 11 at 2.  Respondent was again warned that:

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

Id.

On March 20, 2025, CTP filed a Status Report and Motion to Impose Sanctions.  CRD Dkt. Entry No. 12.  CTP advised that Respondent had not complied with the APHO or my February 28, 2025, 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.  Id. at 2.  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 imposing a $687 civil money penalty.  Id.  On March 20, 2025, CTP also filed a Motion to Stay Deadlines.  CRD Dkt. Entry No. 13. 

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On March 21, 2025, I issued an Order staying the pre-hearing exchange deadlines and giving Respondent until April 4, 2025, to file a response to CTP’s Motion to Impose Sanctions.  CRD Dkt. Entry No. 14.  The March 21, 2025, Order also warned Respondent that if it “fails to respond, I may grant CTP’s Motion to Impose Sanctions and impose the requested civil money penalty . . . .”  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 multiple judicial orders and procedures governing this proceeding.  21 C.F.R. § 17.35(a)(1).  Specifically:

• Respondent failed to comply with 21 C.F.R. § 17.23(a) and paragraph 4 of my APHO, when Respondent failed to respond to CTP’s Request for Production of Documents within 30 days; and
• Respondent failed to comply with my Order Granting CTP’s Motion to Compel Discovery when it failed to produce documents responsive to CTP’s Request for Production of Documents by March 17, 2025.  

I also find that Respondent failed to defend this action.  21 C.F.R. § 17.35(a)(2).  Specifically:

• Respondent did not file a response to CTP’s Motion to Compel Discovery, as permitted by the regulations and my January 24, 2025, Order; and
• Respondent did not file a response to CTP’s Motion to Impose Sanctions, as permitted by the regulations and my March 21, 2025, Order. 

I find that Respondent failed to comply with multiple 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.  I conclude that Respondent’s conduct establishes a basis for sanctions pursuant to 21 C.F.R. § 17.35, and that sanctions are warranted.

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Any sanctions I impose must relate reasonably to the nature and severity of Respondent’s misconduct or failure to comply.  21 C.F.R. § 17.35(b).  Here, Respondent has ceased participating in this action after initially filing an Answer denying all of the violations alleged in CTP’s Complaint.  CRD Dkt. Entry No. 3 at 1-2.  Specifically, Respondent failed to comply with regulatory requirements and two judicial orders, despite my explicit warnings that its failure to do so could result in sanctions.  See CRD Dkt. Entry Nos. 9 at 2, 14 at 1-2; see also APHO ¶ 21.  Respondent’s repeated misconduct interfered with the speedy, orderly, or fair conduct of this proceeding.   

Accordingly, 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).

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:

• At approximately 2:11 PM on January 24, 2024, at Respondent’s business establishment, 4158 South County Trail, Charlestown, Rhode Island 02813, an FDA commissioned inspector conducted an inspection.  During this inspection, a person younger than 21 years of age was able to purchase a package of two Garcia y Vega Game Grape 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;
• In a warning letter dated February 6, 2024, CTP informed Respondent of the inspector’s January 24, 2024, documented violations, and that such actions violate federal law.  The letter further warned that Respondent’s failure to correct its violations could result in a civil money penalty or other regulatory action
• At approximately 10:23 AM on July 24, 2024, at Respondent’s business establishment, 4158 South County Trail, Charlestown, Rhode Island 02813, 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  

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• of two Garcia y Vega Game Mango 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 Respondent Rippys Liquor and Marketplace’s liability under the Act.  The Act prohibits misbranding of a regulated tobacco product.  21 U.S.C. § 331(k).  A regulated 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).  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. 

Respondent having failed to file an answer and taking the alleged above facts as true, I find that Respondent violated the prohibition against selling regulated tobacco products to underage purchasers and failed to verify that a purchaser was 21 years of age or older, thereby violating the Act, 21 U.S.C. § 301 et seq., and its implementing regulations, 21 C.F.R. pt. 1140.  Therefore, Respondent’s actions constitute violations of law that merit a civil money penalty in the amount of $687 under 21 C.F.R. § 17.2.

ORDER

For these reasons, I enter default judgment and impose a civil money penalty in the amount of $687 against Respondent Rippy’s Companies, Inc. d/b/a Rippys Liquor and Marketplace.  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.