Esam Alsaidi d/b/a Forbes Tobacco, DAB TB6951 (2023)

INITIAL DECISION AND DEFAULT JUDGMENT

The Center for Tobacco Products (CTP) of the United States Food and Drug Administration (FDA) filed an Administrative Complaint (Complaint) against Respondent, Esam Alsaidi d/b/a Forbes Tobacco, that alleges facts and legal authority sufficient to justify the imposition of a civil money penalty of $638.  CTP began this case by serving the Complaint on Respondent and filing a copy of the Complaint with the FDA’s Division of Dockets Management.  The Complaint alleges that Respondent impermissibly sold regulated tobacco products to underage purchasers and failed to verify 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, Cigarettes and Smokeless Tobacco, 21 C.F.R. pt. 1140.¹

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CTP seeks a civil money penalty of $638 for three violations within a 24‑month period.²

During this administrative proceeding, Respondent failed to comply with orders and procedures governing this proceeding and failed to defend this action, which interfered with the speedy, orderly, or fair conduct of this proceeding.  21 C.F.R. § 17.35(a).  Accordingly, imposing sanctions on the Respondent is appropriate.  Therefore, pursuant to 21 C.F.R. § 17.35(c)(3), I grant CTP’s motion to impose sanctions, strike Respondent’s Answer and issue this decision of default judgment.

I.        Procedural History

On February 6, 2023, CTP served the Complaint on Respondent at 3801 Forbes Avenue, Pittsburgh, Pennsylvania 15213, by United Parcel Service, pursuant to 21 C.F.R. §§ 17.5 and 17.7.  On the same day, Respondent registered for the Departmental Appeals Board (DAB) E-File system and timely submitted an answer denying the Complaint’s allegations.  Docket (Dkt.) Entry No. 1.  On February 8, 2023, Respondent timely submitted a revised Answer, again denying the Complaint allegations, but adding it would “like to appeal to the court.”  Dkt. Entry No. 3 (Answer). 

On February 10, 2023, another administrative law judge issued an Acknowledgment and Pre-Hearing Order (APHO) that set deadlines for the parties’ filings and exchanges, including a schedule for discovery.  The Order directed that a party receiving a discovery request must provide the requested documents within 30 days of the request.  APHO ¶ 4; see 21 C.F.R. § 17.23(a).  I 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. 

APHO ¶ 21 (citing 21 C.F.R. § 17.35).

On February 10, 2023, Respondent timely submitted its Pre-Hearing Brief, which denied the Complaint allegations.³  Dkt. Entry Nos. 5-11.  On March 16, 2023, CTP filed a

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Status Report stating the parties were unable to reach a settlement in this case.  Dkt. Entry No. 13.

On March 29, 2023, CTP filed a Motion to Compel Discovery with two supporting exhibits, asserting that Respondent had not responded to its discovery request.  Dkt. Entry Nos. 15, 15a-b.  In both my March 31, 2023 Order, and in a By Direction Letter issued on April 20, 2023, I informed Respondent of its failure to respond to CTP’s request for documents and of its deadlines by which to file a response to CTP’s Motion to Compel Discovery.  Dkt. Entry Nos. 17-18; see 21 C.F.R. § 17.32(c); see also APHO ¶¶ 19, 20.  Respondent did not respond to my Order nor the By Direction Letter.

On May 8, 2023, I issued an Order Granting Motion to Compel, in which I granted CTP’s Motion to Compel Discovery, and ordered Respondent to produce documents responsive to CTP’s Request for Production of Documents by May 25, 2023.  Dkt. Entry No. 19. I warned Respondent that:

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.

Order Granting Motion to Compel at 1.  In the same Order, I also extended the parties’ pre‑hearing exchange deadlines.  Id. at 2.

On June 2, 2023, CTP filed a Status Report and Motion to Impose Sanctions, stating that Respondent had not complied with my May 8, 2023 Order.  Dkt. Entry No. 20.  CTP argued that sanctions against Respondent for its repeated non-compliance are an appropriate remedy.  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 civil money penalty. 

On June 6, 2023, I issued an Order informing Respondent that it had until June 23, 2023, to file a response to CTP’s Motion to Impose Sanctions.  Dkt. Entry No. 22.  I warned Respondent that if it failed to file a response, “I may grant CTP’s Motion to Impose Sanctions in its entirety.”  Order at 1 (emphasis in original).  To date, Respondent has not filed a response to CTP’s Motion to Impose Sanctions or my June 6, 2023 Order. 

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;

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(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 directives.  Specifically, Respondent has not complied with:

• the regulation at 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
• my May 8, 2023 Order Granting Motion to Compel, when Respondent failed to submit documents responsive to CTP’s Request for Production of Documents by May 25, 2023.

Additionally, Respondent failed to defend this action.  21 C.F.R. § 17.34(a)(2).  Specifically:

• Respondent did not file a response to CTP’s Motion to Compel Discovery, as permitted by the regulations and my May 8, 2023 Order; and
• Respondent did not file a response to CTP’s Motion to Impose Sanctions, as permitted by the regulations and my June 6, 2023 Order.

In the absence of any explanation from Respondent, I find that Respondent failed to comply with 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.

The harshness of the sanctions I impose must relate to the severity and nature of the failure to comply or misconduct.  21 C.F.R. § 17.35(b).  Here, Respondent failed to comply with a regulation governing this proceeding (21 C.F.R. § 17.23(a)) as well as two of my orders (APHO ¶ 4; Order Granting Motion to Compel) warning that such failure could result in sanctions.  I specified that sanctions may include “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.”  Order Granting Motion to Compel at 1.  Respondent also failed to defend this action, despite my orders expressly reminding Respondent of due dates by which a response, if any, should be filed.  March 31, 2023 Order, April 20, 2023 By Direction Letter, and June 6, 2023 Order; see also 21 C.F.R. § 17.35(a)(2).

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When a party fails to comply with a discovery order, including the discovery provisions under the regulations, I may strike any part of the pleadings or other submissions of the party failing to comply with such request.  21 C.F.R. § 17.35(c)(3).  I find that Respondent’s failure to comply with my discovery orders and failure to defend its action are sufficient to warrant striking its Answer and issuing a decision by default, without further proceedings.  21 C.F.R. §§ 17.35(b), (c)(3).  Accordingly, CTP’s Motion to Impose Sanctions is granted, and I strike Respondent’s Answer.  21 C.F.R. § 17.35(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:

• Respondent owns Forbes Tobacco, an establishment that sells tobacco products and is located at 3801 Forbes Avenue, Pittsburgh, Pennsylvania 15213.  Complaint ¶¶ 11-12.
• An FDA-commissioned inspector conducted an inspection of Respondent’s establishment on October 5, 2021, at approximately 4:35 PM, during which “a person younger than 21 years of age was able to purchase an Ezzy Oval Strawberry Lemonade electronic nicotine delivery system (ENDS) product . . . .”  Additionally, “the underage purchaser’s age was not verified before the sale . . . .”  Complaint ¶ 15.
• On November 30, 2021, CTP issued a Warning Letter to Respondent regarding the October 5, 2021 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 August 18, 2022, at approximately 12:25 PM, during which “a person younger than 21 years of age was able to purchase a

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package of two White Owl Sweets cigars . . . .”  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; 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); see also 21 U.S.C. § 387f (note) (directing the Secretary to change references to persons younger than 18 to younger than 21, and to change the age verification requirements from individuals under the age of 26 to under the age of 30, in 21 C.F.R. subpart B of part 1140).  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 October 5, 2021, and August 18, 2022.  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.⁴  Id.; 21 C.F.R. § 1140.14(b)(2)(i).  Therefore, Respondent’s actions constitute violations of law that merit a civil money penalty.

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Conclusion

CTP has requested a civil money penalty of $638, which is a permissible penalty for three⁵ 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 $638 is warranted and so order one imposed.

Endnotes

¹  As of December 20, 2019, the Act was amended to raise the federal minimum age for the sale of tobacco products to 21 years of age or older.  Act § 906(d)(5).

²  Notably, CTP asserts that it does not include any violations that occurred outside the relevant timeframe in this Complaint.  Complaint ¶ 1, fn.1.

³  The Respondent’s Pre-Hearing Brief, which consisted of handwritten responses on the Pre-Hearing Brief of Respondent’s form, was transmitted as seven separate jpeg files.  Dkt. Entry Nos. 5-11.  Each jpeg file corresponds to one of the nine pages of the Pre-Hearing Brief of Respondent form except for two pages not requiring Respondent’s responses or information.  Id.

⁴  I note that CTP cites 21 C.F.R. § 1140.14(b)(2)(i), which has not been updated to reflect the age change, for the identification violations alleged on October 5, 2021, and August 18, 2022.  See Complaint ¶¶ 13.b, 15.b.

⁵  Two violations were committed on October 5, 2021, and two on August 18, 2022.  In accordance with customary practice, CTP counted the violations identified during the initial inspection as a single violation, and violations identified during subsequent inspections individually.