Ocean Drive Store Inc, DAB No. 3193 (2025)

DECISION TO SUMMARILY AFFIRM ADMINISTRATIVE LAW JUDGE DECISION

Ocean Drive Store Inc. d/b/a Seaside Deli and Market (Respondent) appeals the February 27, 2025 initial decision of an Administrative Law Judge (ALJ) imposing a civil money penalty (CMP) of $16,000 against Respondent for violating the Federal Food, Drug, and Cosmetic Act.  Ocean Drive Store Inc. d/b/a Seaside Deli and Market, DAB TB9129 (2025) (ALJ Decision).  The ALJ sustained the allegations in a complaint filed by the Center for Tobacco Products (CTP) that Respondent received in interstate commerce and offered for sale electronic nicotine delivery system products that lacked the required premarket authorization, in violation of 21 U.S.C. § 331(c), but reduced the penalty from the $20,678 maximum that CTP sought.  ALJ Decision at 14-15, 21.

Summary affirmance is appropriate where, as here, Respondent has not complied with the requirements for an appeal in the governing regulations at 21 C.F.R. § 17.47(c) and our own consideration of the record reveals “no basis to disturb the ALJ’s factual findings or legal conclusions on any issue.”  Fair Bros. Inc., DAB No. 3012, at 2 (2020).  Respondent’s Notice of Appeal (NA) is a two-page letter, which requests leniency from the CMP.  The letter was not accompanied by a written brief as directed by the appeal regulation and does not meet the regulation’s requirement that an appeal “must identify specific exceptions to the initial [ALJ] decision, must support each exception with citations to the record, and must explain the basis for each exception.”  21 C.F.R. § 17.47(c); see Guras LLC d/b/a S & J Food Mart, DAB No. 3158 (2024) (summarily affirming an ALJ decision imposing a reduced CMP where Respondent did not “identify or allege any errors in the ALJ’s initial decision and [did] not explain what parts of the decision Respondent disagrees with and why”).¹

Page 2

Before the Board, Respondent states it is “not disputing anything the [ALJ] has said,” and repeats its assertions to the ALJ that a high CMP would materially affect its ability to do business.  NA at 1.  Respondent, however, does not dispute or allege any error in any part of the ALJ’s analysis of the factors that the statute requires be considered in determining the amount of a CMP.  See ALJ Decision at 15-21; 21 U.S.C. § 333(f)(5)(B) (penalty amount to 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.”).  In appeals of ALJ decisions, “[t]he standard of review on a disputed issue of fact is whether the initial decision is supported by substantial evidence on the whole record,” and “[t]he standard of review on a disputed issue of law is whether the initial decision is erroneous.”  21 C.F.R. § 17.47(k).  Respondent has not disputed the ALJ’s factual findings and has not provided a legal basis for the Board to conclude that the ALJ erred in reducing the CMP to $16,000 from the maximum amount of $20,678 that CTP sought to impose.  Therefore, we reiterate, summary affirmance is appropriate.  See White Dove Groceries, Inc., DAB No. 2973, at 2 (2019) (summarily affirming ALJ’s initial decision where respondent challenged “only the amount of the penalty,” reiterating “contentions raised before the ALJ” and claiming “that its business would suffer if it paid the full penalty amount”).

Respondent also submitted with its appeal what appear to be two sets of business bank statements spanning the period January 2023-March 2025, and explains that it was unaware the bank statements could make a difference in the ALJ’s decision.  NA at 1, Dkt. 1b, 1c.  The regulations permit the Board to remand an appeal to the ALJ where the party appealing the initial decision demonstrates “that additional evidence not presented at the hearing is relevant and material and that there were reasonable grounds for the failure to adduce such evidence at the hearing.”  21 C.F.R. § 17.47(i). 

Respondent has not made the necessary showing to warrant a remand for consideration of new evidence under 21 C.F.R. § 17.47(i).  The ALJ considered “bank statements or any similar documentation” as potentially relevant to support Respondent’s claim of inability to pay the full CMP; the ALJ stated that “[s]uch evidence would have provided a more complete picture of Respondent’s financial position, potentially resulting in a greater reduction in the penalty amount.”  ALJ Decision at 18.  However, Respondent’s assertion that it was not aware the bank statements could weigh in the ALJ’s decision is not reasonable grounds for failure to produce them before the ALJ.  See William Frank Elder-Quintana, DAB No. 3082, at 12 (2023) (holding, in appeal of an ALJ decision under regulations with substantively identical language authorizing remand for the ALJ to consider evidence not presented earlier, that the appellant’s “mistaken understanding” about the relevance of evidence was not reasonable grounds for the failure to produce it before the ALJ).  While we acknowledge that several months of the bank statements provided with the appeal would not have been available to Respondent during the ALJ

Page 3

proceeding, the bank statements that were available at that time show similar balances to the more recent statements. Respondent had ample opportunity to produce the bank statements available prior to the ALJ’s decision but states no reasonable grounds for not doing so.   

Likewise, Respondent’s assertion on appeal that it only controls the convenience store section of the business, and that the landlord receives the income from the gas station, should have been raised before the ALJ, which Respondent acknowledges in its appeal. NA at 1 (“Another part of the information that we left out and should have included was that we only control the store section of the gas station, grocery sales, the actual landlord reaps all the benefits of the profits of the gas…”). Respondent does not state why it did not provide this information or any corresponding evidence before the ALJ, and therefore establishes no basis for remand.  See Leung’s, Inc., DAB No. 3025, at 10 (2020) (declining to remand for ALJ consideration of evidence newly raised on appeal, explaining, “Respondent is not entitled to further proceedings because it has stated no grounds, much less reasonable grounds, for its failure to provide that evidence to the ALJ”).

In the absence of any allegations or showings that the ALJ erred, and having considered the record of the ALJ proceedings, the ALJ Decision, and Respondent’s arguments, we find no basis to disturb the ALJ’s factual findings or legal conclusions.  We therefore summarily affirm the ALJ’s decision.

Endnotes

¹  The Transmittal Letter enclosed with Respondent’s copy of the ALJ Decision advised Respondent that 21 C.F.R. § 17.47 governs the requirements for submission of an appeal to the Board and attached a copy of the Guidelines for Appellate Review which, like the regulation, specifies that the “notice of appeal must be accompanied by a written brief specifying each finding of fact and conclusion of law with which you disagree, and your basis for contending that each challenge to a finding or conclusion is unsupported or incorrect… [W]here appropriate, each argument should be supported by precise citations to the record.”