A and Imran Corporation d/b/a Discount Mart 24/7, DAB TB5282 (2021)

INITIAL DECISION

The Food and Drug Administration's Center for Tobacco Products (CTP) seeks a $594 civil money penalty (CMP) against Respondent, A and Imran Corporation d/b/a Discount Mart 24/7, for violating the Federal Food, Drug, and Cosmetic Act (Act), 21 U.S.C. § 301 et seq., and its implementing regulations, 21 C.F.R. pt. 1140, at least three times within a 24-month period.  Specifically, CTP alleges that Respondent violated the Act when it sold regulated tobacco products to minors and failed to verify, by means of photo identification containing a date of birth, that the purchasers were 18 years of age or older.  For the reasons discussed below, I find Respondent liable for the violations alleged in the Complaint, and conclude that a CMP of $594 is appropriate.

Background and Procedural History

CTP began this case by serving an administrative complaint on Respondent at its establishment located at 5519 Livingston Road, Suite A, Oxon Hill, Maryland 20745, and

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by filing a copy of the Complaint with the Food and Drug Administration's (FDA) Division of Dockets Management.  Respondent timely filed an Answer to CTP's Complaint.  On May 5, 2020, I issued an Acknowledgment and Pre-Hearing Order (APHO) in which I set a schedule of pre-hearing exchanges and deadlines for submissions.

On July 13, 2020, CTP filed a Motion to Compel Discovery, requesting "that an order be entered compelling Respondent to respond to CTP's Request for Production of Documents in its entirety."  CRD Docket (Dkt.) Entry 6.  CTP also filed a Motion to Extend Deadlines on July 13, 2020.  Dkt. Entry 7.  On July 14, 2020, I issued an Order giving Respondent until July 30, 2020 to file a response to CTP's Motion to Compel Discovery.  Dkt. Entry 8.  My July 14, 2020 Order also extended the pre-hearing exchange deadlines.  Id. at 2.  On July 29, 2020, Respondent filed a Response to Request for Production of Documents and four accompanying attachments.  Dkt. Entries 9-13.  Respondent did not file a separate response to CTP's Motion to Compel Discovery.  On August 24, 2020, I issued an Order denying as moot CTP's Motion to Compel Discovery, citing to Respondent's timely submission of a response to CTP's Request for Production of Documents.  Dkt. Entry 14.

On August 26, 2020, CTP filed its pre-hearing exchange consisting of its Informal Brief, a list of proposed witnesses and exhibits, and 19-numbered proposed exhibits (CTP Exs. 1-19).  CTP's exhibits included the written direct testimony of Regulatory Counsel Adriana Gibson, and the FDA-commissioned inspector who conducted the inspections at issue, Inspector Francis Devell Forney.  CTP Exs. 3, 4.

On September 16, 2020, counsel for Respondent filed its pre-hearing exchange consisting of an informal brief and a list of proposed witnesses and exhibits.  Dkt. Entries 18-18a, 19.  On September 16, 2020, Respondent's counsel also filed an Amended Answer, along with a redlined copy of Respondent's original Answer.  Dkt. Entries 16, 17.  On October 6, 2020, I issued an Order setting a pre-hearing conference call for October 27, 2020.  Dkt. Entry 20.

On October 27, 2020, I held a pre-hearing conference in this case.  During the pre-hearing conference, we discussed the procedural history of the case and the evidence submitted by CTP.  See Dkt. Entry 21.  I also explained that the sole purpose of a hearing under the applicable regulations was to allow for the cross-examination and re-direct of any witnesses who had provided sworn testimony in pre-hearing exchanges, and only if the opposing party elected to cross-examine the witness.  Further, I noted Respondent's failure to submit a pre-hearing exchange consistent with my directives in the APHO; specifically, the lack of submission of the written direct testimony of any witnesses by

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Respondent's counsel.1   Respondent's counsel advised of his intent to cross-examine CTP Regulatory Counsel Adriana Gibson and Inspector Francis Devel Forney.  Therefore, I informed the parties that testimony at the hearing would be limited to the cross-examination and re-direct examination of CTP's witnesses.  Id. at 1.  I gave the parties until November 4, 2020 to file any motions to exclude the other party's proposed exhibits, and scheduled the hearing for November 19, 2020 at 11:00 AM Eastern Time.  Id. at 2.

On October 30, 2020, CTP filed a Motion to Exclude Evidence Not Exchanged in Accordance with 21 C.F.R. § 17.25 and the Administrative Law Judge's Orders and Motion to Strike. (Motion to Exclude).  Dkt. Entry 22.  In that motion, CTP asked that I exclude Respondent's Amended Answer and its proposed witness "due to Respondent's failure to comply with 21 C.F.R. § 17.25(a), the APHO, and the July 14, 2020 Order."  Id. at 2-3.  Respondent did not file a response to CTP's motion.  On November 13, 2020, I issued an Order granting CTP's Motion to Strike.  Dkt. Entry 23.  Specifically, my Order excluded Respondent's pre-hearing exchange, finding that it did not "comply with my orders, directives, or the applicable regulations."  Id.at 3.  I stated:

Respondent through counsel has not sought leave to file an amended pre-hearing exchange, to include any exhibits or written direct testimony, which complies with the requirements and directives specified in the APHO . . . .

Id.  My Order also struck Respondent's Amended Answer from the record, finding:

If Respondent's counsel wished to file an amended answer after receipt of CTP's pre-hearing exchange, a motion for leave to file an amended answer should have been submitted, as required by the regulations, accompanied by the amended answer.  Respondent through counsel neither reserved the right to supplement the answer to conform with any evidence provided by CTP in its pre-hearing exchange; nor has Respondent's counsel sought leave to file an amended answer . . . .

Id. at 3-4.

On November 19, 2020, I conducted a hearing in this case.  During the hearing, I admitted CTP Exs. 1-19 into evidence.  Hearing Transcript (Tr.) at 3.  Respondent's

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counsel conducted cross-examination of Ms. Gibson (Tr. at 4-7) and Inspector Forney (Tr. at 8-10).  CTP declined to conduct re-direct examination of either witness.  Tr. at 8, 10.

On December 21, 2020, I informed the parties that the Court had received the transcript of the hearing and uploaded into DAB E-file.  I also set the deadlines for the parties' simultaneous post-hearing brief submissions as January 22, 2021.  Finally, I gave the parties until January 22, 2021 to file any corrections to the transcript.  Dkt. Entry 25.  On January 22, 2021, Respondent's counsel submitted his post-hearing brief (R's Post-Hearing Br.).  Dkt. Entry 26.  Also on January 22, 2021, CTP filed its Notice of Waiver of Post-Hearing Brief.  Dkt. Entry 27.

As the post-hearing briefing period has expired, I now render my decision.

Issues

1. Whether Respondent sold regulated tobacco products to minors and failed to verify the age of the purchasers by means of photographic identification containing the bearer's date of birth on July 12, 2019 and March 14, 2020, in violation of 21 C.F.R. § 1140.14(b)(1) and 1140.14(b)(2)(i); and if so,
2. Whether the civil money penalty amount of $594 that CTP seeks is appropriate.

Analysis

In order to prevail, CTP must prove Respondent's liability by a preponderance of the evidence.  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.  In re Winship, 397 U.S. 358, 371-72 (1970); Concrete Pipe and Products of California, Inc. v. Construction Laborers, 508 U.S. 602, 622 (1993).

CTP has the burden of proving Respondent's liability by a preponderance of the evidence.  21 C.F.R. § 17.33(b).  It is Respondent's burden to prove any affirmative defenses also by a preponderance of the evidence.  21 C.F.R. § 17.33(c).  As detailed below, I find that based on the evidence of record, on the dates and times in question, Respondent sold regulated tobacco products to minors and failed to verify the minors' identification before the sale in violation of 21 C.F.R. § 1140.14(b)(1) and 1140.14(b)(2)(i).

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I.  Violations, Parties' Contentions, and Findings of Fact

A. Violations

CTP seeks a civil money penalty against Respondent pursuant to the authority conferred by the Act and implementing regulations at Part 21 of the Code of Federal Regulations.  The Act prohibits the misbranding of tobacco products while they are held for sale after shipment in interstate commerce.  21 U.S.C. § 331(k).  The FDA, through CTP, may seek civil money penalties from any person who violates the Act's requirements as they relate to the sale of tobacco products.  21 U.S.C. § 333(f)(9).

The sale of a regulated tobacco product to an individual under the age of 18 is a violation of implementing regulations.  21 C.F.R. § 1140.14(b)(1).  The failure to verify, by means of photo identification containing the bearer's date of birth, that no regulated tobacco product purchaser is younger than 18 years of age is also a violation of implementing regulations.  21 C.F.R. § 1140.14(b)(2)(i).

CTP alleges that Respondent committed at least three2 violations of the Act and its implementing regulations within a 24-month period.  Complaint at ¶ 1.  I now turn to whether the allegations in the Complaint are true, and, if so, whether Respondent's actions constitute a violation of law.  21 C.F.R. § 17.45(b).

Specifically, I must determine whether on July 12, 2019, at approximately 1:38 PM, Respondent:

(1) Sold regulated tobacco products in violation of 21 C.F.R. § 1140.14(b)(1); and

(2) Failed 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).

Additionally, I must determine whether on March 14, 2020, at approximately 6:07 PM, Respondent:

(1) Sold regulated tobacco products in violation of 21 C.F.R. § 1140.14(b)(1); and

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(2) Failed 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).

B. Parties' Contentions and Evidence

1. CTP's Position

a.  July 12, 2019 Violations

To support the July 12, 2019 allegation, CTP submitted the declaration of Inspector Francis Devel Forney who conducted the inspection, Inspector Forney's narrative report of the inspection, and photographs of the package of JUUL Mint e-liquid product allegedly purchased on July 12, 2019.  CTP Exs. 4-6, 9, 13.

In his declaration, Inspector Forney stated that on July 12, 2019, at approximately 1:38 PM, he conducted a UB (undercover buy) compliance check inspection at Respondent's location at 5519 Livingston Road, Suite A, Oxon Hill, Maryland 20745.  CTP Ex. 4 ¶ 7.  Inspector Forney further stated:

During the inspection, I parked my car near Discount Mart 24/7 and Minor A and I exited the vehicle.  I watched Minor A enter Discount Mart 24/7 and I entered the establishment moments after Minor A.  From my location, I had a clear, unobstructed view of the sales counter and Minor A.  During the inspection, I observed Minor A purchase an e-liquid product from an employee at the establishment.  Prior to the purchase, I observed that Minor A did not present any identification to the employee.  The employee did not provide Minor A a receipt after the purchase.

Id. ¶ 8.  After the inspection, Inspector Forney and Minor A returned to the vehicle, at which time the inspector retrieved the e-liquid package from Minor A.  Inspector Forney observed that the e-liquid package was a JUUL e-liquid product.  Inspector Forney stated that he then labeled the e-liquid product as evidence, photographed all of the panels of the package, and processed the evidence in accordance with standard procedures at the time of the inspection.  Id. ¶ 9.  Inspector Forney also contemporaneously recorded the inspection in the FDA's Tobacco Inspection Management System (TIMS) and created a Narrative Report.  Id. ¶ 10; see also CTP Exs. 5, 6.

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b.  March 14, 2020 Violations

To support the March 14, 2020 allegation, CTP submitted Inspector Forney's declaration, his narrative report of the inspection, and photographs of the package of the JUUL Classic e-liquid product allegedly purchased on March 14, 2020.  CTP Exs. 7, 8, 10, 16.

In his declaration, Inspector Forney stated that on March 14, 2020, at approximately 6:07 PM, he conducted a follow-up UB compliance check inspection at Respondent's location at 5519 Livingston Road, Suite A, Oxon Hill, Maryland 20745.  CTP Ex. 4 ¶ 12.

Inspector Forney further stated:

During the inspection, I parked my car near Discount Mart 24/7 and Minor B and I exited the vehicle.  I watched Minor B enter Discount Mart 24/7 and I entered the establishment moments after Minor B.  From my location, I had a clear, unobstructed view of the sales counter and Minor B.  During the inspection, I observed Minor B purchase an e-liquid product from an employee at the establishment.  Prior to the purchase, I observed that Minor B did not present any identification to the employee.  The employee did not provide Minor B a receipt after the purchase.

Id. ¶ 13.  After the inspection, Inspector Forney and Minor B returned to the vehicle, at which time the inspector retrieved the e-liquid package from Minor B.  Inspector Forney observed that the e-liquid product was a JUUL Classic Tobacco e-liquid product.  Inspector Forney stated that he then labeled the e-liquid product as evidence, photographed all of the panels of the package, and processed the evidence in accordance with standard procedures at the time of the inspection.  Id. at 14.  Inspector Forney also contemporaneously recorded the inspection in the FDA's TIMS and created a Narrative Report.  Id. ¶ 15; see also CTP Exs. 7, 8.

c.  Interstate Commerce

CTP also offered as a witness, Adriana Gibson, Regulatory Counsel in CTP's Office of Compliance and Enforcement.  CTP Ex. 3; see also Tr. at 4-7.  In her written declaration,  Ms. Gibson testified that in her official capacity, she has personal knowledge of FDA's processes and records regarding tobacco establishment registration and product listing requirements.  CTP Ex. 3 ¶ 4.  Ms. Gibson also declared that she "gained personal knowledge regarding how CTP enforces certain provisions of the . . . Act . . . and other laws enforced by FDA . . . ."  Id.  She further declared that the JUUL Mint and JUUL Classic e-liquid products purchased during the July 12, 2019 and March 14, 2020 inspections, respectively, at Respondent's establishment were manufactured, prepared,

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compounded, or processed for commercial distribution at JUUL Labs, Inc.'s facilities in Wisconsin and/or North Carolina.  Id. ¶¶ 5-8.  Ms. Gibson's declaration is corroborated by the FDA United Registration and Listing Systems (FURLS) report in the record.  See CTP Ex. 19.

2. Respondent's Position

Respondent through counsel filed an Answer, which asserts, "Respondent is without knowledge or information sufficient to form a belief as to the averments in paragraph 9 . . . paragraph 11 of the complaint."  Answer ¶¶ 9, 11.  In the Answer, counsel also states:

Respondent admits that on or about 9 August 2019 respondent received a "warning letter".  Neither the warning letter nor the "Notice of Compliance Check Inspection" referenced in paragraph 12 of the complaint are attached to the complaint, and consequently respondent is without knowledge or information to form a belief as to the averments in paragraph 12 of the complaint as to the content of said documents.

Id. ¶ 12.  Further, Respondent asserts that "the law relied upon by complainant is unconstitutional," and "[t]he complainant is not the real party in interest."  Id. ¶¶ 18, 19.

In the Informal Brief submitted, while conceding Respondent's acknowledgment of receipt of the Notice of Compliance Check Inspection (NCCI), counsel maintains that Respondent was not notified of the July 12, 2019 violations by CTP.  Dkt. Entry 18.  Specifically, counsel asserts:

(i)  the [August 8, 2019] "warning letter" was not directed to respondent nor its resident agent, it was addressed only to "Discount Mart 24/7"[;]
(ii)  as a practical matter respondent did not received the 8 August 2019 "warning letter".

Id. at 2.  Counsel contends that the UPS delivery notification (CTP Ex. 15c) does not specifically identify "Discount Mart 24/7" or Respondent as the recipient of the August 8, 2019 delivery.  Id.  Additionally, counsel notes purported "inconsistencies when the ‘warning letter' is examined with the delivery notification."  Id.  Counsel disputes the content of the August 9, 2019 CTP delivery and argues:

The warning letter is stamped "Aug 08 2019".  The delivery notification states the letter was "shipped/billed on 08/06/2019".  The delivery notification described the delivery location as "residential".  Discount Mart 24/7 is located in a "strip" shopping center.  Its commercial character is apparent to the most casual observer . . . Respondent did not receive the warning letter."

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Id.

In Respondent's Post-Hearing Brief, counsel reiterates the assertions presented in the Informal Brief, arguing that CTP has failed to show that the warning letter was served on Respondent.  Dkt. Entry 26 at 1-2.  Counsel maintains that the USPS delivery notification for the August 8, 2019 warning letter, showing that the delivery occurred on August 9, 2019 "is both inaccurate and misleading."  Id.  Counsel states:

CTP, exhibit 1, is a 3 page "Warning Letter" dated 8 August 2019 addressed as follows:  "Discount Mart 24/7 Attn:  Site Manager, 5519 Livingston Road, Oxon Hill, Maryland, 20745" (emphasis supplied).  CTP exhibit 2 is a UPS record and it does not demonstrate that the 8 August 2019 warning letter was received on 9 August 2019 as alleged in the complaint.  This is because the UPS delivery notification (i.e. CTP exhibit 2) states the document it references was "shipped/billed on 8/06/2019" (emphasis supplied).  Consequently, the proof of delivery cannot be construed to verify delivery of a document dated 8 August 2019 on 6 August 2019.  Respondent's answer acknowledges receipt of a "warning letter" on 9 August 2019.  However, despite respondent's failed attempt to amend this acknowledgment, its original answer did note that it could not verify the contents of the document received.3   Complainant's proof demonstrates what was received by respondent on 9 August 2019 was not the 8 August 2019 letter.  Whatever is referenced in paragraph 12 of the complaint as demonstrated by "UPS records . . . [as] received on August 9, 2019 cannot be the 8 August 2019 letter, as the UPS record shows delivery of something "shipped/billed 08/06/2019" (CTP ex 2).

Id. at 2-3.  Counsel concludes by suggesting that the March 14, 2020 violations should be treated as the initial violations and without imposition of a fine, in that CTP has failed to show Respondent's receipt of the August 8, 2019 warning letter.  Id. at 3.  In the alternative, counsel submits Respondent's failure to receive notification of the July 12, 2019 violations is a mitigating factor, "which should result in the 14 March 2020 events being treated as an ‘initial' violation without the imposition of a fine."  Id. at 3-4.

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3. Hearing Testimony

At the November 19, 2020 hearing, Respondent's counsel cross-examined Regulatory Counsel Adriana Gibson.  See Tr. at 4-7.  During the hearing, Respondent's cross-examination of Ms. Gibson focused on the witness's personal knowledge "regarding how CTP enforces certain provisions of the Act; specifically Ms. Gibson's knowledge of documentation in CTP's possession that supports Respondent's receipt of the August 8, 2019 warning letter.  Tr. at 5-6.  This line of questioning was met with objections by counsel for CTP, who argued:

Paragraph 4 of Ms. Gibson's declaration says she has knowledge of the processes and records maintained with regard to the establishment registration and product listing requirements which does not include the referenced warning letter.

Id. at 6.  I sustained CTP's objection.  Id.  Below is an excerpt of the relevant testimony given by Ms. Gibson during cross-examination:

Q:  . . . Ms. Gibson, do you have any knowledge as to how - - what administration records there are that identify A and Imran Corporation as the owner of the Discount Mart 24/7?
A:  The establishment registration and listing product information that I'm knowledgeable of is for manufacturing establishments for the purposes of interstate commerce.
Q:  . . . Is there something in the record as of let's say August 9, 2019 that identifies the corporation as the owner of Discount Mart?
A:  Again, I don't have any information about the retailer.  My declaration is only concerning the tobacco product manufacturer of the products purchased.

Tr. at 7.

Respondent's counsel also conducted cross-examination of Inspector Forney at the hearing.  Tr. at 8-10.  Counsel's line of questioning focused primarily on the inspector's knowledge of the external, physical layout of Respondent's establishment.  Id.  In relevant part, Inspector Forney testified as follows:

Q:  . . . Are you familiar with the contents of the Administration's Complaint in this matter?
A:  Yes.
Q:  . . . And you conducted the two investigations that led to the allegations of violations that are contained in the Complaint, correct?

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A:  Yes.
Q:  . . . And how many times, personally, have you been to the location of the Discount [Mart] 24/7 store?
A:  I would say four times.
Q:  . . . Would you describe the location as commercial or residential?
A:  Commercial

*  *  *  *  *  *

Q:  . . . Any other commercial establishments located nearby?
A:  Yes.  There's a liquor store, there's a carry-out, and then the Discount Mart . . .
Q:  Do those other commercial establishments share a parking lot or parking space with the 24/7 Discount Mart?
A:  Yes.

Tr. at 8-9.

4. Findings of Fact

As to the alleged violations at issue, I find Respondent's arguments to be without merit.  Respondent offered no evidence or testimony to rebut the testimony of Inspector Forney that it sold regulated tobacco products to minors and failed to verify the age of the minors on July 12, 2019 and March 14, 2020.

In response to the Complaint, Respondent raised several arguments, all of which have been considered.  Initially, in response to the violations alleged in the Complaint, Respondent answered that it "is without knowledge or information sufficient to form a belief as to the averments in paragraph 9 [and paragraph 11] of the complaint."  Dkt. Entry 2a ¶¶ 9, 11.  In its Answer, with regard to the July 12, 2019 violation, Respondent acknowledged receipt of a "warning letter" on or about August 9, 2019.  Id. ¶ 12.  However, counsel then maintains that the omission of the warning letter and Notice of Compliance Check Inspection (NCCI) as attachments to the Complaint establishes Respondent's lack of knowledge regarding the violations at issue.  Id.

In its Informal Brief, counsel expands on the initial argument and concludes that, because the warning letter was not directed to Respondent or its resident agent Tariq Mahmoud, Respondent in effect did not receive the warning letter.  Dkt. Entry 18 at 2.

In its post-hearing brief, Respondent's counsel goes further to argue that CTP has not established that Respondent received the August 8, 2019 warning letter.  Dkt. Entry 26.  To support its contention, and citing to CTP Exhibits 1 and 2, counsel avers:

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[T]he UPS delivery notification (i.e. CTP exhibit 2) states the document referenced was "shipped/billed on 8/06/2019" (emphasis supplied).  Consequently, the proof of delivery cannot be construed to verify delivery of a document dated 8 August 2019 on 6 August 2019.  Respondent's answer acknowledges receipt of a "warning letter" on 9 August 2019 . . . [but noted] that it could not verify the contents of the document received . . .

Exhibit 2 also describes the location where the delivery was made as "residential".  Inspector Forney described the location of respondent's business as "commercial" . . . Furthermore, Adrianna [sic] Gibson testified that the administration's "establishment registration" would identify A and Imran Corporation as the business owner.  The complainant, however, did not address its 8 August 2019 correspondence to the corporation or its resident agent but rather to the "site manager" of the business's trade name (CTP Ex. 2).  The UPS delivery notification indicates the delivery was received by Omar.  No evidence was offered to establish the purported relationship, if any, between respondent and Omar.

Id. at 3.

The regulations at 21 C.F.R. § 17.9(b)(1) provide that a respondent, in its answer, "[s]hall admit or deny each of the allegations of liability made in the complaint; allegations not specifically denied in the answer are deemed admitted."  (Emphasis added).  Therefore, because Respondent did not explicitly deny the allegations in the complaint, they are deemed admitted.

On review of the record, I find Respondent's contention regarding "ineffective notice" of the violations alleged by CTP to be without merit.  At the outset, while counsel's argument about ineffective service of the warning notice may be considered in the mitigation of penalty, it has no merit in determining liability.

On the issue of "service," the regulations provide that service of a complaint may be made one of two ways:  either by certified or registered mail or similar mail delivery service (i.e., one which provides a return receipt record reflecting receipt), or by delivery in person.  21 C.F.R. § 17.7(a)(1) and (a)(2).  Delivery in person must be to either an individual respondent or to an "officer or managing or general agent in the case of a corporation or unincorporated business."  21 C.F.R. § 17.7(a)(2)(i) and (a)(2)(ii) (emphasis added).  If the complaint is served by certified or registered mail or similar mail delivery service, proof of service, stating the name and address of the person on whom the complaint was served, and the manner and date of service must be provided.  21 C.F.R. § 17.7(b).

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First, as Respondent's counsel pointedly remarks that the warning letter was not addressed to Respondent's resident agent, I infer counsel's reliance on the regulation at 21 C.F.R. §17.7 – Service of complaint – as applicable legal authority on this issue.  As previously discussed, section 17.7 (a)(2) provides for service to an individual, officer, or general agent when delivery is in person.  However, I note that the regulations at 21 C.F.R. § 17.7(a) and (b) are applicable to service of a complaint, not an FDA warning letter.  However, the Family Smoking Prevention and Tobacco Control Act (TCA), Pub. L. No. 111-31, 123 Stat. 1776 (2009) does require "timely and effective notice by certified or registered mail or personal delivery to the retailer of each alleged violation at a particular retail outlet prior to conducting a follow-up compliance check" and notice of "all previous violations at the outlet" prior to charging a person with a violation. TCA § 103(q)(1)(B), (D).  There is no dispute that Respondent received the warning letter on August 9, 2019, exactly four weeks after the July 12, 2019 inspection.  See CTP Ex. 2.  In fact, Respondent admits as much in the Answer filed.  Dkt. Entry 2a ¶ 12.

Nevertheless, whether or not the warning letter (or the Notice of Compliance Check Inspection) was attached to the Complaint sent to Respondent is inconsequential to the issue of Respondent's receipt of the FDA notices.  In this case, the FDA notices at issue, as well as CTP's Complaint, were sent to Respondent's establishment by registered mail.  See Dkt. Entry 1b; CTP Ex. 15c.  Respondent has not denied that its establishment is located at 5519 Livingston Road, Oxon Hill, Maryland 20745, or that it does business at the address that is the subject of the investigations at issue.  Nor does Respondent deny receiving FDA's warning letter on August 9, 2019, as well as other documents including CTP's Complaint, sent to that address and which Respondent timely answered.  Therefore, under this set of facts, Respondent's argument is unpersuasive.  See Deli-licious Catering, Inc. d/b/a Convenient Food Mart, DAB No. 2812 (2017) ("Respondent cites no authority for the notion that we may invalidate CTP's enforcement action simply because the name that appears on Respondent's place of business at the address where the Respondent does business and to which the enforcement notices were sent may not be its legal name.  Respondent does not deny that it does business – including the sale of tobacco products – at the address that is the subject of this enforcement action and admits receiving the CTP correspondence at that address . . . .").

Further, the fact that there is a discrepancy between the August 8, 2019 date-stamp on the warning letter (CTP Ex. 1) and the shipped/billed date of August 6, 2019 on the UPS Delivery Notification (CTP Ex. 2) does not nullify the warning letter, or Respondent's confirmed receipt of the warning letter, and could amount to nothing more than harmless administrative error.  However, based on this error, Respondent would have me conclude that the warning letter was not received because:

Complainant's proof [UPS Delivery Notification] demonstrates what was received by respondent on 9 August 2019 was not the 8 August 2019 letter.  Whatever is referenced in paragraph 12 of the complaint as demonstrated

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by "UPS records . . . [as] received on August 9, 2019" cannot be the 8 August 2019 letter, as the UPS record shows delivery of something "shipped/billed 08/06/19" (CTP ex 2).

Dkt Entry 26 at 3.  Again, counsel's argument overlooks the fact that Respondent acknowledged receipt of the warning letter.  The discrepancy could be the result of  inadvertently date-stamping the warning letter with the incorrect date by clerical staff.  And since counsel disputes whether Respondent received the warning letter, he could have presented evidence or testimony during these proceedings to support such a contention.  For example, Respondent's counsel could have, at a minimum, submitted the written direct testimony of Tariq Mahmoud (Respondent's resident agent), or "Omar," the individual who signed for the August 9, 2019 delivery.  Counsel could have also elected to present each witness at the November 19, 2020 hearing for cross-examination by CTP counsel.  Respondent did neither.

I find the testimony of Regulatory Counsel Gibson and Inspector Forney, supported by corroborating evidence, to be credible.  I find that CTP has provided sufficient evidence to support its allegation that Respondent sold regulated tobacco products to minors and failed to verify that purchasers were of sufficient age on July 12, 2019 and March 14, 2020, in violation of 21 C.F.R. § 1140.14(b)(1) and 1140.14(b)(2)(i).  I find that Respondent failed to provide evidence to rebut CTP's allegation.

Therefore, based on the facts and evidence as outlined above, CTP has met its burden to establish that Respondent A and Imran Corporation d/b/a Discount Mart 24/7 violated the regulations on July 12, 2019 and March 14, 2020.  21 C.F.R. § 1140.14(b)(1) and (b)(2)(i) .

I also conclude that CTP has met its burden to establish Respondent's liability under the Act for at least three violations within a 24-month period.

II.  Civil Money Penalty

Pursuant to 21 U.S.C. § 333(f)(9), Respondent is liable for a CMP not to exceed the amounts listed in FDA's civil money penalty regulations at 21 C.F.R. § 17.2.  In its Complaint, CTP sought to impose the penalty amount, $594, against Respondent for three violations of the Act and its implementing regulations within a 24-month period.  Complaint ¶ 1.

I have found that Respondent committed three violations of the Act and its implementing regulations within a 24-month period.  When determining the amount of a civil money penalty, I am required to take into account "the nature, circumstances, extent and gravity of the violations and, with respect to the violator, ability to pay, effect on ability to

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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).

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

Respondent has failed to comply with the Act and its implementing regulations two times for at least three violations.  The repeated inability of Respondent to comply with federal tobacco regulations is serious in nature and the civil money penalty amount should be set accordingly.

B. Respondent's Ability to Pay and Effect on Ability to do Business

Respondent has not provided any evidence to show it is unable to pay the $594 CMP sought by CTP.  Likewise, Respondent has not presented any evidence to show that implementation of the CMP sought by CTP would have a negative effect on its ability to continue to do business. 

C. History of Prior Violations

The current action is the first civil money penalty action brought against Respondent for violations of the Act and its implementing regulations.  As noted above, Respondent has, at least three times, violated the prohibition against selling regulated tobacco products to persons younger than 18 years of age, 21 C.F.R. § 1140.14(b)(1), and failing to verify, by means of photo identification containing the date of birth, that the purchasers were 18 years of age or older, 21 C.F.R. § 1140.14(b)(2)(i).

D. Degree of Culpability

Based on my finding that Respondent committed the violations as alleged in the current Complaint, I hold it fully culpable for three violations of the Act and its implementing regulations.

E. Additional Mitigating Factors

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).

Respondent asserts that "failure to receive notification is a mitigating factor which should result in the 14 March 2020 events being treated as an "initial" violation, without the imposition of a fine."  Dkt. Entry 26 at 4.

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I am not persuaded by counsel's unsupported contention.  Contrary to counsel's claim, Respondent admitted that the warning letter dated August 8, 2019 was, in fact, received.  See Dkt. Entry 2a ¶ 12.  Respondent has violated the regulations on two separate occasions.  These regulations were created as an initiative to avert minors from purchasing tobacco products.  Thus, I find no basis for mitigation of the CMP sought by CTP, which I find proportional and appropriate in this case.

F. Penalty

Based on the foregoing reasoning, I find the penalty amount of $594 to be reasonable and appropriate under 21 U.S.C. § 333(f)(5)(B) and 333(f)(9).

Conclusion

Pursuant to 21 C.F.R. § 17.45, I enter judgment in the amount of $594 against Respondent, A and Imran Corporation d/b/a Discount Mart 24/7, for three violations of the Federal Food, Drug, and Cosmetic Act (Act), 21 U.S.C. § 301 et seq., and its implementing regulations, 21 C.F.R. pt. 1140, within a 24-month period.  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.

• 1. As discussed above, on September 16, 2020, Respondent through counsel timely filed, among other things:  two Informal Briefs of Respondent; and Respondent's List of Proposed Witnesses and Exhibits.  Respondent's submission did not include any proposed exhibits, and identified one proposed witness, Tariq Mamood.  Respondent did not include the written direct testimony for its proposed witness.  See Dkt. Entries 18-18a, 19.
• 2. The Complaint alleges two violations were committed on July 12, 2019, and two on March 14, 2020.  In accordance with customary practice, CTP counted the violations at the initial inspection as a single violation, and all subsequent violations as separate individual violations.  See Orton Motor, Inc. d/b/a Orton's Bagley v. U.S. Dep't of Health & Human Servs., 884 F.3d 1205 (D.C. Cir. 2018).
• 3. Counsel's mention of a "failed attempt to amend this acknowledgment" is a reference to the Amended Answer which was stricken from the record in my Order dated November 13, 2020, finding that Respondent's counsel "neither reserved the right to supplement the answer to conform with any evidence provided by CTP in its pre-hearing exchange; nor has Respondent's counsel sought leave to file an amended answer . . . ."  See Dkt. Entry 23 at 3-4.