Ramoco Marketing Group LLC d/b/a Liberty, DAB TB9503 (2025)

INITIAL DECISION

On August 1, 2024, the Center for Tobacco Products (CTP) filed an Administrative Complaint (Complaint) against Respondent, Ramoco Marketing Group LLC d/b/a Liberty.  The Complaint alleges that CTP previously initiated two civil money penalty (CMP) actions against Respondent Liberty for 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 (Tobacco Regulations).  The most recent action concluded after Liberty admitted to at least five violations of the Act and Tobacco Regulations for selling covered tobacco products to underage purchasers and failing to verify, by means of photographic identification containing a date of birth, that the purchasers were 21 years of age or older on December 31, 2021, October 4, 2022, and July 21, 2023.  CTP also alleges that Liberty unlawfully sold covered tobacco products to an underage purchaser and failed to verify the underage purchaser’s age on May 4, 2024, thereby violating section 906(d)(5) of the Act (21 U.S.C. § 387f(d)(5)) and 21 C.F.R. § 1140.14(b)(2)(i) of the Tobacco Regulations.  Therefore, CTP seeks a $13,785 CMP against Respondent for violating the Act and Tobacco Regulations at least seven times within a 48-month period.  For the reasons discussed below, I find that Respondent violated the Act as alleged by CTP, and that a CMP of $13,785 is appropriate.  

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I. Background and Procedural History

CTP began this matter by serving a Complaint on Respondent Liberty at 1033 Kaighn1 Avenue, Camden, New Jersey 08103 by United Parcel Service (UPS), and by filing a copy of the Complaint with the Food and Drug Administration’s (FDA) Division of Dockets Management.  Civil Remedies Division (CRD) Docket (Dkt.) Entry Numbers (Nos.) 1 (Complaint), 1b (UPS Tracking Proof of Service).

On August 20, 2024, Respondent through counsel electronically filed, via the Departmental Appeals Board (DAB) E-File System, its timely Answer.  CRD Dkt. Entry No. 3a.  In its Answer, Respondent denied the allegations in the Complaint, and asserted defenses, including that “Federal and New Jersey State law both provide for defenses to allegations of selling tobacco products without verifying the purchaser’s age which both hinge on the actual physical appearance of the decoy . . . .”  Id. at 2.  Respondent also disputed the appropriateness of the CMP sought by CTP, stating it was “too high” and “any previous settlements of violations is not evidence of culpability and . . . should not be used to determine or increase any fines or penalties regarding the isolated May 4, 2024 occurrence.”  Id. at 3.  On September 12, 2024, I issued an Acknowledgment and Pre-Hearing Order (APHO) acknowledging receipt of Respondent’s Answer and establishing procedural deadlines for this case.  CRD Dkt. Entry No. 4.

On September 18, 2024, Respondent prematurely filed its Pre-Hearing Brief of Respondent.  CRD Dkt. Entry No. 5.  On September 26, 2024, a letter by my direction (By Direction Letter) was sent to the parties noting Respondent’s premature pre-hearing submission, contrary to the procedures established in my APHO.  CRD Dkt. Entry No. 6 at 1-2.  The By Direction Letter advised the parties “Judge Robinson will not accept Respondent’s pre-haring submission as it is out of order and not in compliance with the requirements set out in her APHO.”  Id. at 2.  The By Direction Letter reiterated the filing deadline for CTP’s pre-hearing exchange as December 2, 2024, and advised that “[a]fter receiving and reviewing CTP’s pre-hearing exchange, Respondent should refile its pre-hearing exchange, amended to comport with the requirements as set out in Judge Robinson’s APHO . . . .”  Id.  On October 15, 2024, CTP filed a Notice of Entry of Appearance and a Status Report stating that the parties were unable to reach a settlement and intended to proceed to a hearing.  CRD Dkt. Entry Nos. 7, 8.  CTP represented that an attempt was made to contact Respondent to discuss filing the Status Report, to no avail.  CRD Dkt. Entry No. 8 at 1.

On November 22, 2024, CTP filed a Motion to Compel Discovery (MTC) with two exhibits consisting of its Request for Production and the UPS Delivery Notification.  

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CRD Dkt. Entry Nos. 10, 10a-10b.  In its MTC, CTP stated that Respondent had not responded to its discovery request, as required by the APHO and the regulations.  CRD Dkt. Entry No. 10 at 2.  On that same date, CTP also filed a Motion to Extend Deadlines requesting a 30-day extension of “any deadlines, including the December 2, 2024 due date for CTP’s pre-hearing exchange . . . .”  CRD Dkt. Entry No. 11 at 2.

On December 4, 2024, I issued an Order advising Respondent that it had until December 10, 2024, to file a response to CTP’s Motion to Compel Discovery.  CRD Dkt. Entry No. 12.  I also warned that if Respondent failed to respond, “I may grant CTP’s motion in its entirety.”  Id. at 2; see also APHO ¶ 21.  In my Order, I also extended the pre‑hearing exchange deadlines.  CRD Dkt. Entry No. 12 at 2.  Respondent failed to respond to either CTP’s Motion to Compel Discovery or my December 4, 2024, Order, or otherwise comply with CTP’s Request for Production of Documents.

On December 20, 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 January 6, 2025.  CRD Dkt. Entry No. 13.  Again, I warned:

• . . . Failure [to comply] 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. at 2.  My Order also extended the filing deadlines for the parties’ pre-hearing exchanges to February 3, 2025, for CTP’s pre-hearing exchange to Respondent, and February 21, 2025, for Respondent’s pre-hearing exchange to CTP.  Id.

On January 7, 2025, CTP filed a Status Report and Motion to Impose Sanctions.  CRD Dkt. Entry No. 14.  CTP advised that Respondent had not complied with my APHO or my December 20, 2024, Order Granting CTP’s Motion to Compel Discovery.  Id. at 1.  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 $13,785 civil money penalty.  Id.  On January 7, 2025, CTP also filed a Motion to Stay Deadlines.  CRD Dkt. Entry No. 15.

On January 13, 2025, Respondent filed a copy of its responses to CTP’s Request for Production of Documents.  CRD Dkt. Entry No. 16.  On that same date, Respondent also filed a Response to CTP’s Motion to Impose Sanctions.  CRD Dkt. Entry No. 17.  On January 21, 2025, I issued an Order giving CTP until February 5, 2025, to file a status report “stating whether it intends to continue pursuing its Motion to Impose Sanctions” in light of Respondent’s January 13, 2025, filing in response to the Motion to Impose 

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Sanctions.  CRD Dkt. Entry No. 18.  On January 29, 2025, CTP filed a Status Report withdrawing its Motion to Impose Sanctions.  CRD Dkt. Entry No. 19.

On February 3, 2025, CTP timely filed its pre-hearing exchange consisting of an Informal Brief of Complainant, Complainant’s List of Proposed Witnesses and Exhibits, and 15 proposed exhibits (CTP Exhibits (Exs.) 1-15).  CRD Dkt. Entry Nos. 20, 20a-20p.  CTP’s exchange included the written direct testimony of two proposed witnesses:  James Bowling, Deputy Division Director for the Division of Enforcement and Manufacturing in the Office of Compliance and Enforcement, CTP, FDA (CTP Ex. 5); and Inspector Gloria Achiamaah, an FDA-commissioned officer with the state of New Jersey (CTP Ex. 6).  CRD Dkt. Entry Nos. 20f, 20g.

On February 4, 2025, I issued an Order accepting CTP’s withdrawal of its Motion to Impose Sanctions, reaffirming the pre-hearing exchange deadlines previously established in my December 20, 2025, Order, and acknowledging receipt of CTP’s pre-hearing exchanged filed on February 3, 2025.  CRD Dkt. Entry No. 21.

On March 19, 2025, I held a pre-hearing conference (PHC) in this case.  I explained my role as an impartial Administrative Law Judge, the issues to be decided in this case, and the parties’ respective burdens of proof.  See CRD Dkt. Entry No. 25 at 1 (Summary of March 19, 2025, Pre-Hearing Conference and Order Following Pre-Hearing Conference (PHC Summary Order)); see also 21 C.F.R. §§ 17.19, 17.33.  Also, during the PHC, we discussed the parties’ pre-hearing exchange submissions.  Respondent stated that it did not object to CTP’s proposed exhibits being admitted into evidence.  PHC Summary Order at 2.  Respondent also stated that it did not intend to cross-examine CTP’s proposed witnesses.  Id.  Therefore, CTP Exs. 1-15 were admitted into the record.  Id.  I noted that Respondent did not file a pre-hearing exchange and asked Respondent’s counsel whether he intended to offer any evidence or testimony.  Counsel stated that he did not intend to submit any evidence or provide any written direct testimony.  Id.  Further, the parties advised that no stipulation agreements had been discussed or reached in this case.  Id.

Based on the representations of the parties, I determined that there was no need for a hearing for the cross-examination of either of CTP’s witnesses.  The parties agreed to waive appearance at an oral hearing, and I set a schedule for the submission of the parties’ final briefs and informed the parties that I would issue a decision on the written record after the record was closed.  Id.; see also 21 C.F.R. §§ 17.33, 17.34, 17.45(a).

In my March 25, 2025, PHC Summary Order, I set April 24, 2025, as the deadline for the parties to file simultaneous final briefs, and May 9, 2025, for the parties to file simultaneous responses to the opposing party’s final briefs.  CRD Dkt. Entry No. 25 at 2.

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On April 4, 2025, CTP filed a Motion to Extend Deadlines, stating that “[o]n April 1, 2025, FDA experienced a significant reduction in force (RIF), including in FDA’s Center for Tobacco Products [CTP’s] Office of Compliance and Enforcement, . . . and [CTP] is still evaluating the impact the RIF may have on CTP’s immediate operations . . . [and] is requesting a 30-calendar day extension of all pending deadlines . . . .”  CRD Dkt. Entry No. 26.  On April 8, 2025, I issued an Order granting CTP’s motion and extending the deadline for the parties’ final briefs to May 27, 2025, and the deadline for responsive briefs to June 9, 2025.  CRD Dkt. Entry No. 27.

On May 27, 2025, CTP filed its Notice of Waiver of Final Brief.  CRD Dkt. Entry No. 28.  Respondent did not file a final brief or notice waiving submission of a final brief.  As the parties did not file final briefs, there were no responsive briefs.  Therefore, the administrative record is now complete and closed.  I will now decide this case based on the evidence in the full administrative record.  21 C.F.R. §§ 17.41(b), 45(a).

II. Issues

• Whether Respondent unlawfully sold a covered tobacco product to an underage purchaser on May 4, 2024, and failed to verify, by means of photo identification containing a date of birth, that the purchaser was 21 years of age or older, in violation of section 906(d)(5) the Act and 21 C.F.R. § 1140.14(b)(2)(i);
• Whether any affirmative defenses are meritorious; and
• If Respondent is liable for penalties or assessments, whether the $13,785 CMP is appropriate, considering any mitigating or aggravating factors that I find in this case.  21 C.F.R. § 17.45.

III. Applicable Law

The Act prohibits the misbranding of a covered tobacco product while it is held for sale after shipment in interstate commerce, including “covered tobacco products” such as cigars.  21 U.S.C. § 331(k).  A covered tobacco product is defined as “any tobacco product deemed to be subject to the [Act] . . . but excludes any component or part that is not made or derived from tobacco.”  21 C.F.R. § 1140.3.  A covered tobacco product is misbranded if it is sold or distributed in violation of section 906(d) of the Act (21 U.S.C. § 387f(d)) or regulations issued under section 906(d) of the Act (21 C.F.R. pt. 1140).  21 U.S.C. § 387c(a)(7)(B); 21 C.F.R. § 1140.1(b).  Under section 906(d)(5) of the Act, no retailer may sell covered tobacco products to any person younger than 21 years of age or fail to verify, by means of photographic identification containing a purchaser’s date of birth, that no covered tobacco purchaser is younger than 21 years of age.  21 U.S.C. § 387f(d)(5); 21 C.F.R. § 1140.14(b)(1)-(2).

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CTP may seek a CMP against any person who violates any requirement of the Act or regulations concerning the sale of covered tobacco products by filing an administrative complaint.  21 U.S.C. § 333(f)(5) and (f)(9); see also; 21 C.F.R. §§ 17.1(j), 17.5(a).  The Act and implementing regulations provide limitations on the amount of the CMP based on the number of violations within a specified timeframe.  21 U.S.C. § 333(f)(9); 21 U.S.C. § 333 note; 21 C.F.R. § 17.2; 45 C.F.R. § 102.3.  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).

CTP has the burden to prove Respondent’s liability and the appropriateness of the penalty by a preponderance of the evidence.  21 C.F.R. § 17.33(b).  Respondent has the burden to prove any affirmative defenses and any mitigating factors likewise by a preponderance of the evidence.  21 C.F.R. § 17.33(c).  The U.S. Supreme Court has described the preponderance of the evidence standard as requiring that the trier-of-fact believe that the existence of a fact is more probable than not before finding in favor of the party that had the burden to persuade the judge of the fact’s existence.  Concrete Pipe and Prods. of Cal., Inc. v. Constr. Laborers, 508 U.S. 602, 622 (1993) (citing In re Winship, 397 U.S. 358, 371-72 (1970) (Harlan, J., concurring)).

IV. Findings of Fact and Conclusions of Law

1. A. CTP has proven by a preponderance of the evidence that Respondent unlawfully sold covered tobacco products to an underage purchaser on May 4, 2024, in violation of the Act.

In the case presently before me, at approximately 2:43 PM on May 4, 2024, an FDA-commissioned inspector conducted an inspection of Respondent’s establishment, Liberty, located at 1033 Kaighns Avenue, Camden, New Jersey 08103.  CTP alleged that during the inspection, Respondent committed violations of selling a covered tobacco product to an underage purchaser, in violation of section 906(d)(5) of the Act, and failing to verify the age of the purchaser by means of photographic identification containing the bearer's date of birth, in violation of 21 C.F.R. § 1140.14(b)(2)(i).  Specifically, a person younger than 21 years of age was able to purchase a Black & Mild Original cigar.  Complaint ¶¶ 11, 13.

In its case against Respondent, CTP relies on the written direct testimony of Inspector Gloria Achiamaah, FDA-commissioned officer with the state of New Jersey, and James Bowling, Deputy Division Director for the Division of Enforcement and Manufacturing, in CTP’s Office of Compliance and Enforcement.  CTP Exs. 5, 6.  Inspector Achiamaah testified that on May 4, 2024, at approximately 2:43 PM, she conducted an undercover buy (UB) compliance check inspection at Respondent’s establishment under Compliance 

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Check Assignment Number 24NJ050336B.  CTP Ex. 6 ¶ 7.  Inspector Achiamaah stated Underage Purchaser (UP) A accompanied her during the compliance check inspection.  Id.  Prior to the inspection, Inspector Achiamaah stated that she confirmed that UP A was under the age of 21 on the date of the inspection and that UP A did not take any photographic identification into Respondent’s establishment.  Id.; see also CTP Ex. 9 (UP A Redacted Birth Certificate).  Inspector Achiamaah also testified that she confirmed that UP A did not possess any tobacco products before the inspection.  CTP Ex. 6 ¶ 7.  Inspector Achiamaah testified that, during the inspection, she had an unobstructed view of UP A and the sale counter, and she observed UP A purchase a cigar directly from an employee at the establishment.  Id. ¶ 8.  Inspector Achiamaah testified that prior to the purchase, she observed that UP A did not present any identification to Respondent’s employee.  Id.  Inspector Achiamaah then stated, after she and UP A exited the store and returned to her vehicle, UP A immediately handed her the cigar.  Id. ¶ 9.  Inspector Achiamaah testified that she observed the cigar was a Black & Mild Original cigar, and she labeled the cigar as evidence and photographed the cigar.  Id.; see also CTP Exs. 10, 11 (May 2024 Photographs of Tobacco Product Sold to UP A, and May 2024 Photographs of Tobacco Product Sold to UP A in Evidence Bag).

Deputy Division Director Bowling testified that the Black & Mild Original cigar observed and sold during the May 4, 2024, inspection at Respondent’s establishment was manufactured by John Middleton Company in Virginia, and the manufacturer does not have any registered tobacco production facilities in the state of New Jersey.  CTP Ex. 5 ¶¶ 6-8.

I find CTP’s evidence persuasive.  Inspector Achiamaah’s testimony that she personally observed the violations at issue is credible and supported by other evidence in the record.  Specifically, the contemporaneous photographs of the Black & Mild Original cigar sold to UP A, subsequent Narrative Report and Tobacco Inspection Management System (TIMS) Assignment Form completed by Inspector Achiamaah, CTP’s Compliance Check Inspection Notice, and UP A’s redacted birth certificate corroborate Inspector Achiamaah’s testimony that Respondent sold a Black & Mild cigar to UP A, who was under the age of 21, and failed to verify UP A’s age with appropriate identification before the sale on May 4, 2024.  Compare CTP Ex. 6 and CTP Exs. 7-12.

I also find Deputy Director Bowling’s testimony to be credible and supported by other evidence in the record demonstrating that the Black & Mild Original cigar sold to UP A on May 4, 2024, traveled in interstate commerce from Virginia to New Jersey prior to the sale.  CTP Exs. 5, 15.  Deputy Director Bowling has personal knowledge of CTP’s enforcement and recordkeeping policies and access to the agency’s tobacco establishment registration and product listing database.  CTP Ex. 5 ¶¶ 3-5.  Although Respondent’s Answer denied the allegations set forth in the Complaint, it has not submitted any contrary evidence, has declined to cross-examine or impeach CTP’s witnesses’ testimonies, and has failed to otherwise challenge CTP’s documentary evidence.  CRD 

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Dkt. Entry No. 3a (Answer) at 1; PHC Summary Order at 2 (Respondent’s counsel confirming that he did not intend to submit any evidence or provide any written direct testimony and reiterating that he did not intend to cross-examine either of CTP’s witnesses).  Accordingly, I conclude that Respondent has failed to rebut CTP’s evidence, and CTP has proven, by a preponderance of the evidence, that Respondent unlawfully sold a covered tobacco product to an underage purchaser and failed to verify the purchaser’s age with photographic identification showing the purchaser’s date of birth on May 4, 2024, thereby committing two violations of the Act and implementing regulations.

1. B. Respondent’s legal arguments disputing liability lack merit.

In its Answer, Respondent asserts the following defense:

• Federal and New Jersey State law both provide for defenses to allegations of selling tobacco products without verifying the age of the purchaser which both hinge on the actual physical appearance of the decoy used by the FDA or State law enforcement.  It is our position that the employee at Liberty Gas located at 1033 Kaighn Avenue, Camden, New Jersey, was an ordinary prudent person and sold a single Black & Mild Original cigar to a person who appeared to be of legal age.  Furthermore, the complainant has offered no evidence or claims or testimonials as to the actual physical appearance or even gender or garb of the decoy thereby failing to make a case that age verification was required.

Id. at 2 (emphasis in original, underlining replaced by italics).  Respondent asserts that it is “an absolute defense” if the undercover purchaser “either appeared over the age of 26 or appeared to the ordinary prudent person to be of legal age (now 21).”2  Id.

Respondent’s argument fails.  To the extent Respondent claims that UP A appeared to be of legal age to forgo the age verification requirement, it has not submitted a declaration 

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from the sales clerk or other evidence to support its argument.  Further, the Board has held that the age verification requirement in 21 C.F.R. § 1140.14(b)(2)(i) is an objective standard that does not consider a retailer’s subjective inquiry about the appearance of a tobacco product purchaser.  Duffy and Associates, Inc. d/b/a Discount Tobacco, DAB No. 3114 at 7-9 (2023); see also Auto Valet Inc. d/b/a Finest Car Wash, DAB No. 2915 at 8 (2018) (there is no “subjective appearance exception to the requirement that retailers check the photo ID of every tobacco purchaser aged 26 years and younger.”); Deli-Icious Catering Inc. d/b/a Convenient Food Mart, DAB Decision No. 2812 at 11 (2017) (“the regulations . . . do not incorporate any ‘appearance’ or ‘judgment’ standard and instead require that retailers check photo IDs of all persons aged 26 and younger who seek to purchase [regulated tobacco products].”).  The Board reasoned that the interpretation of the age verification requirement as an objective standard is consistent with the regulation’s plain language, regulatory history and context, and prior interpretations of the Board.  Id.  Indeed, “requiring age verification if a person ‘looked’ like he or she was a particular age would be difficult to administer and to enforce.”  Deli-Icious at 11.  Therefore, contrary to Respondent’s contention, retail clerks and employees are required by Federal law to check the identification of every purchaser 30 years of age or younger notwithstanding any perceptions regarding the purchaser’s appearance.  21 U.S.C. § 387f(d)(5); 21 C.F.R. § 1140.14(b)(2)(i).

Respondent’s assertion that New Jersey state law provides a defense to a retailer’s failure to verify a tobacco purchaser’s age by photo identification if the purchaser appears to be of sufficient age is also without merit.  First and foremost, Respondent was charged with violations of federal tobacco law, not New Jersey state law.  See Western Spirits, Inc. d/b/a T-Joe’s Steakhouse and Saloon, DAB Decision No. 2844 at 6 (2018) (“Respondent’s reliance on Wyoming law is misplaced since this case, as the ALJ concluded, is governed by federal law (the Act and its implementing regulations) [,] not state law.”).  However, assuming arguendo that Respondent was, in fact, in compliance with state law, such compliance does not preclude Respondent’s responsibility to adhere to applicable federal laws and regulations.  Thus, Respondent’s arguments are unpersuasive in its attempt to deny any liability.

Tobacco products are highly dangerous and addictive products and, as such, are heavily regulated.  21 U.S.C. § 387 note.  Retailers that choose to distribute tobacco products have the burden to assure they sell such products in compliance with the law.  Having determined that CTP met its burden and Respondent’s defenses lack merit, I hold that Respondent violated the prohibition against selling covered tobacco product to an underage purchaser and failed to verify the purchaser’s age with photographic identification showing the purchaser’s date of birth on May 4, 2024, 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 CMP.

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1. C. Respondent has not demonstrated by a preponderance of the evidence any mitigating circumstances to support a reduced CMP.

This is the third CMP action CTP has brought against Respondent.  Complaint ¶¶ 15-16 (referencing CRD Number T-24-300, FDA Number FDA-2023-H-4708; CRD Docket Number T-23-1023, FDA Docket Number FDA-2023-H-0433).  The most recent prior complaint alleged that Respondent committed at least five violations of the Act on December 31, 2021, October 4, 2022, and July 21, 2023.  Complaint ¶ 15.  The most recent prior action concluded when Respondent admitted the allegations contained in the complaint filed by CTP and paid the agreed upon CMP in settlement of that claim.  Complaint ¶ 16.  Respondent has not contested these prior violations, and they are administratively final.  21 C.F.R. § 17.15(b) (stating that a “settlement agreement shall be filed in the docket and shall constitute complete or partial resolution of the administrative case as so designated by the settlement agreement.”).  Coupled with the two violations committed on May 4, 2024, I conclude that Respondent has committed at least seven violations of the Act and its implementing regulations within a 48-month period.

I must now consider whether CTP’s requested CMP is appropriate or whether the mitigating circumstances offered by Respondent support a reduction in the CMP.  Pursuant to 21 U.S.C. § 333(f)(9), Respondent Liberty is liable for a CMP not to exceed the amounts listed in the FDA’s CMP regulations at 21 C.F.R. § 17.2; see also 45 C.F.R. § 102.3.  When determining the appropriate amount of a CMP, I am required to consider any “circumstances that mitigate or aggravate the violation” and “the factors identified in the statute under which the penalty is assessed . . . .”  21 C.F.R. §§ 17.34(a); 17.34(b).  Specifically, I must consider “the nature, circumstances, extent and gravity of the violations and, with respect to the violator, ability to pay, effect on ability to continue to do business, any history of prior such violations, the degree of culpability, and such other matters as justice may require.”  21 U.S.C. § 333(f)(5)(B).  Also, “for purposes of mitigating a civil penalty . . . [I] shall consider the amount of any penalties paid by the retailer to a State for the same violation” and whether the retailer has an “approved training program.”  21 U.S.C. § 333 note (Guidance).  Respondent must prove any mitigating factors by a preponderance of the evidence.  21 C.F.R. § 17.33(c).

CTP seeks to impose a CMP amount of $13,785 against Respondent.  Complaint ¶ 1.  In its Answer, Respondent maintains that the CMP sought by CTP is too high or should not be imposed against Respondent.  CRD Dkt. Entry No. 3a at 3.  Specifically, Respondent argues that “references to any previous settlements of violations is not evidence of culpability and they should not be used to determine or to increase any fines or penalties regarding the isolated May 4, 2024, occurrence.”  Id.  For the reasons explained below, I reject Respondent’s arguments and conclude that a CMP of $13,785 is appropriate.

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1. 1. Nature, Circumstances, Extent and Gravity of the Violations

The Family Smoking Prevention and Tobacco Control Act (Tobacco Control Act) was enacted for the purpose of authorizing regulation of tobacco products for the “protection of the public health.”  21 U.S.C. § 387f(d).  CTP contends that Respondent’s violations are serious in nature as they contravene the FDA’s efforts to protect youth from the multitude of adverse health effects associated with tobacco use.  CRD Dkt. Entry No. 20 at 12 (Informal Brief of Complainant).  CTP specifically states that the “violations on May 4, 2024 are particularly serious because Respondent, for the fourth time in less than [48] months, directly sold a tobacco product to an underage purchaser.”  Id.

Moreover, CTP refers to the February 3, 2022, Warning Letter it issued to Respondent, citing Respondent for violations on December 31, 2021, involving the sale of a covered tobacco product to an individual under the minimum federal age for tobacco sales and failure to verify the age of a person purchasing covered tobacco products by means of a photographic identification containing the bearer’s date of birth.  Id.; CTP Ex. 14 at 1.  CTP asserts that the Warning Letter notified Respondent that future violations may result in a CMP action or other action by FDA.  CRD Dkt. Entry No. 20 at 13; see also CTP Ex. 14 at 2.  Finally, CTP states the Warning Letter referred the Respondent to an FDA website, which included information to help tobacco retailers understand and comply with FDA tobacco laws and regulations.  CRD Dkt. Entry No. 20 at 13; CTP Ex. 14 at 3.

Respondent’s arguments concerning the nature and circumstances surrounding its most recent violation is not that any of CTP’s allegations are fallible but instead that, under Federal and New Jersey State law, a retailer is not required to verify by photo identification a purchaser’s age if the purchaser physically appears to be over the age of 26.  Answer at 2.  As explained above, Respondent’s argument clearly demonstrates a misunderstanding of the applicable law.

Respondent also attempts to minimize the nature of the violations, stating “only one allegation . . . occurred on May 4, 2024 regarding the sale of a single Black & Mild Original cigar” and “such a minimal, alleged violation” does not warrant a burdensome penalty.  Answer at 3.  However, Respondent fails to acknowledge that the undercover cigar sale on May 4, 2024, resulted in two violations of the Act and its implementing regulations – one for the sale to an underage tobacco purchaser and a second for failing to verify the age of a tobacco purchaser with photographic identification.  Moreover, contrary to Respondent’s statements that the requested penalty of $13,785 is “excessive and arbitrary,” the Act and implementing regulations set the maximum penalty amounts based on the number of violations within a specified timeframe, with the penalties increasing as the number of violations increase.  21 U.S.C. § 333(f)(9); 21 U.S.C. § 333 note; 21 C.F.R. § 17.2; 45 C.F.R. § 102.3.  Here, the regulations expressly authorize a maximum penalty of $13,785 for “a sixth or subsequent violation of [the Act] or of the 

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tobacco product regulations within a 48-month period . . . .”   45 C.F.R. § 102.3 (Table 1 to § 102.3 - Civil Monetary Penalty Authorities Administered by HHS).

I also considered Respondent’s previous violations of the Act and CTP’s evidence that Respondent received its Warning Letter. CTP Exs. 1-4, 14.  The evidence demonstrates that Respondent is repeatedly unsuccessful in its attempts to comply with federal tobacco regulations, which is serious in nature and therefore the CMP amount should be set accordingly.

1. 2. Respondent’s Ability to Pay and Effect on Ability to Do Business

Respondent contends that the CMP sought by CTP is “excessive” and “burdensome,” but does not argue that it cannot pay the penalty or that the penalty would negatively impact its ability to do business.  CRD Dkt. Entry No. 3a at 3.  As CTP stated in its Informal Brief of Complainant, Respondent did not provide any evidence to support its inability to pay the proposed $13,785 CMP, and Respondent can continue to “sell tobacco products and other products at the establishment.”  CRD Dkt. Entry No. 20 at 13-14.

I agree with CTP that Respondent has failed to produce evidence demonstrating a financial hardship or that the penalty will have a negative impact on its business, despite being afforded multiple opportunities to do so.  Accordingly, in the absence of evidence in the administrative record to substantiate the potential financial hardship a CMP would cause Respondent, I have no basis to support a reduction in the amount of the CMP.  Moreover, even if I were to reduce the CMP amount, Respondent’s claims alone that it could not afford the penalty or that paying the penalty would affect its ability to continue to do business do not provide me with any information to determine what an appropriate reduction would be.

1. 3. History of Prior Violations

The current Complaint is the third CMP action brought against Respondent for violations of the Act and its implementing regulations.  As noted above, Respondent previously admitted to at least five violations of the prohibitions against selling covered tobacco products to underage purchasers and failing to verify, by means of photo identification containing a date of birth, that the purchasers were 21 years of age or older.  Complaint ¶¶ 15-16.  Yet, Respondent contends that “references to any previous settlements of violations [are] not evidence of culpability and . . . should not be used to determine or increase any fines or penalties regarding the isolated May 4, 2024 occurrence.”  Id. at 3.

First, Respondent’s violations on May 4, 2024, were not an isolated occurrence.  When settling the most recent CMP action, Respondent admitted to five violations of the act that occurred on December 31, 2021, October 4, 2022, and July 21, 2023, waived the ability to contest these violations, and understood “that these violations may be counted 

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in determining the total number of violations for purposes of future enforcement actions.”  CTP Ex. 4 (Acknowledgment Form Required to Settle the Civil Money Penalty Action in CRD Docket No. T-24-300/ FDA Docket No. FDA-2023-H-4708); see also CTP Ex. 3 (most recent Administrative Complaint for Civil Money Penalty in CRD Docket No. T-24-300/ FDA Docket No. FDA-2023-H-4708).  Although settlement offers and the like are not admissible to prove liability or the invalidity of a CMP in a disputed proceeding, parties are free to settle a CMP action – and with the agreed upon terms of their choosing. 21 C.F.R. §§ 17.15(b), 17.39(f).  Once the settlement agreement is filed in the docket, it constitutes the complete or partial resolution of the case.  21 C.F.R. § 17.15(b).  Here, Respondent’s settlement agreement expressly acknowledged that the violations alleged in the previous complaints occurred and may be counted in future enforcement actions.

Second, despite Respondent’s arguments to the contrary, the Act and tobacco regulations explicitly authorize progressively larger penalties for subsequent violations that occur within specified timeframes.  21 U.S.C. § 333(f)(9); 333 note (Guidance) (quoting Tobacco Control Act § 103(q)(2)(A)-(B)); 45 C.F.R. § 102.3 (Table 1 to 
§ 102.3 - Civil Monetary Penalty Authorities Administered by HHS).  The purpose of escalating penalties is to deter repeat violations and to encourage compliance with the law.  Additionally, the table of civil money penalties is adjusted annually for inflation.  See 88 Fed. Reg. 69,531 (Oct. 6, 2023) (publishing the adjusted penalty amounts applicable to this case).  For example, the maximum CMP for a fifth violation within a 36-month period is $ 6,892, whereas the maximum CMP for a sixth or subsequent violation within a 48-month period is $ 13,785.  Thus, repeat violations warrant a larger penalty under law.

I also find that Respondent’s history of prior violations, despite warnings, warrants a progressively larger CMP.  As stated by CTP, Respondent’s “repeated violations show an unwillingness or inability to sell tobacco products in accordance with federal tobacco laws.”  CRD Dkt. Entry No. 20 at 14.  Respondent’s continued inability to comply with FDA tobacco regulations supports the imposition of a proportionate CMP.

1. 4. Degree of Culpability

Based on the evidence in the administrative record, including Respondent’s history of noncompliance and my findings that Respondent subsequently committed two additional violations of the Act and implementing regulations on May 4, 2024, I find Respondent fully culpable for seven violations of the Act and its implementing regulations within a 48-month period.  The CMP should be commensurate with Respondent’s level of culpability.  As explained above, I reject Respondent’s argument that “references to any previous settlements of violations [are] not evidence of culpability.”  Answer at 3.

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1. 5. State Penalties

The Act provides that, “for purposes of mitigating a civil penalty . . . [I] shall consider the amount of any penalties paid by the retailer to a State for the same violation.”  21 U.S.C. § 333 note (Guidance); 21 C.F.R. § 17.34(b).  Although Respondent raises New Jersey state law in its defense, it has not argued or submitted any evidence showing that it paid penalties to the state of New Jersey for the same violations.  Answer at 3.  Accordingly, this factor is neither aggravating nor mitigating of the proposed penalty.

1. 6. Employee Training Program

The Act instructs that I must consider whether the retailer has an “approved training program” when assessing a civil money penalty.  21 U.S.C. § 333 note (Guidance); 21 C.F.R. § 17.34(b).  The Act establishes two schedules of CMPs, depending on whether retailers have implemented a training program that complies with FDA standards.  21 U.S.C. § 333 note (Guidance) (quoting Tobacco Control Act § 103(q)(2)(A)-(B)); see also 45 C.F.R. § 102.3.  Respondent has not argued or submitted evidence showing that it has an approved employee training program.  Nevertheless, until FDA promulgates regulations establishing standards for approved retailer training programs, CTP has decided to seek CMPs using the lower schedule for all retailers.  U.S. Food & Drug Admin., Tobacco Retailer Trainer Programs (Revised): Guidance for Industry (August 2018) at 18, https://www.fda.gov/media/79013/download [https://www.fda.gov/regulatory-information/search-fda-guidance-documents/tobacco-retailer-training-programs] (non-binding guidance document containing various recommendations for retailer training programs).  Accordingly, this factor is neither aggravating nor mitigating of the proposed penalty.

1. 7. Other Matters as Justice May Require

The Act gives me discretion to consider any other evidence or arguments to mitigate the amount of the CMP.  21 U.S.C. § 333(f)(5)(B).  Mitigation is an affirmative defense for which Respondent bears the burden of proof.  Respondent must prove any affirmative defenses and any mitigating factors by a preponderance of the evidence.  21 C.F.R. § 17.33(c).

After reviewing the administrative record, I do not find any evidence or legal support for any additional mitigating circumstances.  Respondent failed to prove that the requested CMP is too high and should be reduced or not assessed.  Notably, Respondent did not present any persuasive evidence to support that it is not fully culpable, cannot afford the proposed CMP, or would be forced out of business.

In summary, Respondent admitted to five previous violations of Section 906(d)(5) of the Act (21 U.S.C. § 387f(d)(5)) and regulations at 21 C.F.R. pt. 1140 on December 31, 

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2021, October 4, 2022, and July 21, 2023.  CTP has proven two additional violations on May 4, 2024, by a preponderance of the evidence in the administrative record.  Based on the foregoing, I conclude that Respondent committed seven violations within a 48-month period and that a CMP in the amount of $13,785 is appropriate under 21 U.S.C. §§ 333(f)(5)(B) and 333(f)(9).

V. Conclusion

Pursuant to 21 C.F.R. § 17.45, I impose a civil money penalty of $13,785 against Respondent, Ramoco Marketing Group LLC d/b/a Liberty, for seven violations within a 48-month period.  Pursuant to 21 C.F.R. §§ 17.11(b), 17.45(d), this decision becomes final and binding upon both parties after 30 days of the date of its issuance.