15-006901 Global Hookah Distributors, Inc. vs. Department Of Business And Professional Regulation, Division Of Alcoholic Beverages And Tobacco Status: Closed Recommended Order on Thursday, October 20, 2016.

Summary: Petitioner proved that the tax assessment by the Department of Business and Professional Regulation, Division of Alcoholic Beverages and Tobacco, was not correct.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

GLOBAL HOOKAH DISTRIBUTORS,

INC.,

Petitioner,

vs. Case No . 15 - 6901

DEPARTMENT OF BUSINESS AND

PROFESSIONAL REGULATION,

DIVISION OF ALCOHOLIC BEVERAGES

AND TOBACCO,

Respondent.

_______________________________/

RECOMMENDED O RDER

Pursuant to notice to all parties, a final hearing was

conducted in this case on August 18, 2016, via video

teleconference with sites in Tallahassee and Lauderdale Lakes,

Florida, before Administrative Law Judge R. Bruce McKibben of

the Division of Administrative Hearings ( Ð DOAH Ñ ).

APPEARANCES

For Petitioner: Gerald J. Donnini, II, Esquire

Joseph C. Moffa, Esquire

James F. McAuley, Esquire

Jonathan W. Taylor, Esquire

Moffa, Sutton and Donnini, P.A.

One Financial Plaza, Suite 2202

100 Southeast Third Avenue ,

Fort Lauderdale, Florida 33394

For Respondent: Elizabeth A. Teegen, Esquire

Office of the Attorney General

The Capitol, Plaza Level 01

Tallahassee, Florida 32399 - 1050

STATEMENT OF THE ISSUE S

The issue in this case is whether Respondent, Department of

Business and Professional Regulation, Division of Alcoholic

Beverages and Tobacco (the ÐDepartmentÑ), appropriately and

correctly assessed the taxes owed by Petitioner, Global Hookah

Distributors, Inc. (ÐGlobal HookahÑ), on other tobacco products

(ÐOTPÑ) for the period January 1, 2013 , through June 30, 2013.

Global Hookah also asserts as an issue in this case whether it

has a Ðsubstantial nexusÑ with Florida such that the Department

may assess and collect taxes under the Commerce Clause of the

United States Constitutio n. See Art . I, § 9, U.S. Const.

Unless otherwise stated herein, all references to Florida

Statutes shall be to the 2016 codification.

PRELIMINARY STATEMENT

On December 8, 2015, Global Hookah timely filed a ÐPetition

for Chapter 120 HearingÑ with the Department. The Department

forwarded the petition to DOAH for assignment to an

Administrative Law Judge. The case was thereafter consolidated

with DOAH Case No. 16 - 3105RU for the purposes of conducting a

final hea ring. A separate and distinct final o rde r in that case

is being issued contemporaneously with this Recommended Order.

Global Hookah alleges in its Petition that the DepartmentÓs

assessment of tax on OTP is not correct in that the Department

seeks to artificially estimate the wholesale sales p rice of the

products upon which the tax assessment is based. Specifically,

the Department used something it deemed the Ðbest available

informationÑ to make the assessment.

At the final hearing, Global Hookah called one witness:

Brennan Appel. Global Hoo k ahÓs Exhibits 4 through 22,

31 through 34, 37, 38, 40 through 42, and 53 through 55 were

admitted into evidence. The Department called one witness:

Julio Cesar Torres, senior tax audit administrator. The

DepartmentÓs Exhibits 1 through 6 were admitted i nto evidence.

The parties advised that a transcript of the final hearing

would be ordered. The parties were, by rule, allowed ten days

from the filing of the transcript at DOAH to submit proposed

recommended orders but asked for and were gran ted five

ad ditional days. The T ranscript was filed at DOAH on

September 13, 2016, and each party timely submitted a proposed

recommended order.

FINDINGS OF FACT

1 . Global Hookah was formed as a Florida corporation on

June 9, 2005, with its principal place of business in Melbourne,

Florida. After graduation from college , Global HookahÓs owner

and 100 percent shareholder, Brennan Appel, decided to move his

company to North Carolina. Global Hookah was re - formed as a

North Carolina corporation on June 14, 2007. Appel then moved

all of his inventory and business equipment to a 10,000 - square -

foot warehouse in Charlotte, North Carolina. Each corporate

annual report filed since 2007 reflects the Charlotte, North

Carolina , address. All annual meetings and corporate tax

returns indicate North Carolina as the situs for the

corporation. Mr. Appel, sole shareholder of Global Hookah, has

resided in North Carolina continuously since 2007. At all times

pertinent hereto, Global Hookah was conducting its business from

North Carolina. When the North Carol ina corporation was formed,

Mr. Appel mistakenly failed to convert the Florida Global Hookah

corporation into a foreign for - profit corporation. That

oversight was corrected on Ma y 31, 2016, by way of a filing with

the Florida Division of Corporations.

2 . Global Hookah does not currently have a physical place

of business in Florida; its only connection to the State is the

sale and delivery (by unaffiliated carriers) of the prod ucts it

sells. When the company was still operating out of its Florida

offices, Mr. AppelÓs mother, Jennifer Appel, worked as an

employee and was an officer of the Florida corporation. After

the move to North Carolina, Mrs. Appel became a part - time

emplo yee, performing quality assurance checks in the North

Carolina warehouse. She was paid for her services by way of a

direct deposit into her checking account in Florida. Mrs. Appel

continues to reside permanently in Florida, traveling to North

Carolina wh en working for Global Hookah. Mrs. Appel is not an

officer of the North Carolina corporation.

3 . When Global Health was located in Melbourne, Florida,

the DepartmentÓs Orlando office conducted its semiannual tax

audits. The DepartmentÓs office in Margat e, Florida , conducts

audits of out - of - state licensees, and the audit at issue was

therefore conducted by the Margate office.

4 . Global Hookah sells about 3 ,500 different tobacco -

related products to customers in many jurisdictions, including

Florida. It s customers are primarily businesses , such as hookah

lounges, night clubs, bars, restaurants, and cigar stores, but

also other tobacco distributors. Some products are also sold by

Global Hookah directly to consumers. The products are sent to

customers vi a U.S. Mail or third - party carriers.

5 . The Department is the government agency responsible

for, inter alia, monitoring and collecting taxes on the sale of

tobacco and OTP in Florida. As part of its duties, the

Department audits on a regular basis (fro m every six months to

every two years) each entity which distributes tobacco and OTP

in Florida.

6 . In July 2013, the Department notified Global Hookah

that an audit would be performed on that company for the period

January 1, 2013 , through June 30, 2013. The primary purpose of

the audit was to determine the wholesale sales price of the OTP

sold by Global Hookah in Florida during the audit period,

determine the amount of products sold, and assess a tax on the

total. How that audit actually transpired is a matter of

dispute between the parties. The parties agree that an auditor

from the Department, Deborah Spady, contacted Mr. Appel and

requested certain records so that she could conduct the audit.

Beyond that, the parties completely disagree as to what

transpired.

7 . The DepartmentÓs position, based almost entirely on

unsubstantiated hearsay testimony from Mr. Torres, is as

follows: Ms. Spady asked for certain company records to be sent

to her via U.S. Mail , but Global Hookah refused to comply with

th e request. Ms. Spady then scheduled a visit to the Global

Hookah offices in North Carolina to obtain the records she

needed. She was provided numerous boxes of documents to review,

but was not allowed to use the companyÓs copier to make copies.

She call ed her supervisor, Mr. Torres, who told her to purchase

a hand - held scanner and to scan all the documents so they could

be printed on her return to Florida. Ms. Spady purchased a

scanner and returned to Global Hookah. At that point she was

told that she could not scan the documents. Discussions between

the Department and attorneys for Global Hookah ensued, resulting

in Ms. Spady being allowed to scan the documents. She allegedly

scanned an amazingly large number of documents in just a day and

a half at the Global Hookah offices. Ms. Spady brought the

scanned documents back to Florida so they could be printed and

an audit could be performed for the audit period. At that

point, Ms. Spady commenced the audit.

8 . According to Mr. Appel, the audit happened like this:

Mr. Appel was informed by Mr. Torres that Ms. Spady would be

conducting an audit for the aforementioned time period.

Mr. Torres said that Ms. Spady preferred to come to North

Carolina to do the audit. Upon her arrival at the Global Hookah

of fices in North Carolina, Mr. Appel gave Ms. Spady a CD

containing all the requested documents, i.e., purchase invoices

showing the cost of the tobacco and OTP, sales documents showing

the products were sold in Florida, and the monthly returns filed

by the taxpayer pursuant to Florida requirements. The monthly

returns are a self - reporting summarization of products shipped

to and sold in Florida by a distributor (minus some allowed

exemptions). Compilation of those records on a CD was

Mr. AppelÓs normal pro cedure for the semiannual audits conducted

by the Department. Ms. Spady reviewed the CD on her computer

when she went to lunch. When she returned to Global HookahÓs

offices after lunch, she reported that some of the files on the

CD would not open properl y. Mr. Appel converted the documents

on the CD into another format and verified that Ms. Spady could

open the files. Ms. Spady said she was satisfied with the

results and left the Global Hookah offices. Mr. Appel never saw

Ms. Spady again.

9 . The parti es basically agree only that an audit was

initiated by the Department, it was commenced by Ms. Spady, and

that someone else ultimately completed the audit. Just about

everything else about the pre - audit process is disputed. It is

as if the parties were t alking about two completely different

audits, which is what Global Hookah suggests happened. There

was a subsequent audit performed by the Department where the

auditor did scan some documents. There was allegedly some

dispute in the latter audit concerni ng the auditor attempting to

scan documents relating to sales in states other than Florida.

A letter was supposedly sent to the auditor addressing that

issue, but no such evidence was presented at final hearing. The

Department says there was a subsequent audit, but Global Hookah

Ðrefused to provide recordsÑ so it was not completed.

10 . Nonetheless, at some point in time , another auditor,

Robert Lerman, took over the Global Hookah audit from Ms. Spady.

None of Ms. SpadyÓs audit notes were preserved and so were not

available for review at fi nal hearing to substantiate

Mr. TorresÓ hearsay testimony concerning how the audit was

initiated. Ms. Spady, who no longer works for the Department,

was not called as a witness at final hearing.

11 . On November 24, 2014 (about four month after Ms. Spady

commenced the audit), Mr. Lerman set up an audit file. At the

commencement of his work, Mr. Lerman was advised by Mr. Torres

that the records obtained from Global Hookah could not be

trusted. This was due to the fac t that Global Hookah had

produced documents entitled Ðsales orderÑ rather than

traditional Ðinvoices,Ñ even though the Department had accepted

the same kinds of documents from Global Hookah in the past. The

Department believed that the sales orders could be altered,

while the invoices would be more precise and final. Faced with

its unease using the sales orders, the Department contacted

Mr. Appel and requested that he submit invoices instead of sales

orders for the audit period. Global Hookah contacted i ts

supplier in California, Fantasia Distributors, Inc.

(ÐFantasiaÑ) , to obtain invoices to submit to the Department.

The only difference betwee n the sales orders and invoices Î -

bes i des the title of the documents - - was that some charges had

been zeroed out, presumably because the amount had been paid

when the invoice was issued. Mr. Appel provided the Department

with 40 pages of invoice documents marked as Ðinvoiced in full.Ñ

12. The Department compared the new Fantasia invoices with

the Global Hookah sal es orders and determined that some of the

information contained therein did not match up appropriately.

There were some missing numbers, some invoices were not in

logical number sequence, and there appeared to be other

discrepancies.

13 . At that point, M r. Torres got more involved in the

Global Hookah audit. From the documents supplied by Global

Hookah, Torres prepared a spreadsheet identifying 18 separate

dates of transactions between Global Hookah and Fantasia during

the audit period. He found, howeve r, that there were really

only about 15 actual purchases; some of the costs relative to a

single purchase were divided and appeared on invoices with

different dates. Some of the invoices had five - digit

identification numbers that did not seem to match up with the

sales orders previously provided. Based upon his review and

findings, Mr. Torres deemed the invoices from Fantasia (which

had been provided by Global Hookah) to be less than credible.

Mr. Torres in fact concluded, unilaterally, that Global Hooka h

was attempting to hide purchases and to ÐdeceiveÑ the

Department. It is noted that the Department made no attempt to

contact Fantasia, with whom it was very familiar, to ascertain

why the documents did not match up.

14 . Once Mr. Torres reached that con clusion, he decided to

ascertain the actual purchase amounts by way of Ðbest available

information.Ñ According to his audit notes, Mr. Lerman was

directed by Mr. Torres to determine the Ð best available

information Ñ as follows: He was to make a schedule o f all

products purchased by Global Hookah from Fantasia. Inasmuch as

the Department was familiar with Fantasia and knew that company

supplied many distributors in Florida, Mr. Lerman was told to

compare the cost of each product Global Hookah had bought fr om

Fantasia with the cost other providers had paid for the same

products. An average unit price for the products was thus

calculated by the Department.

15 . The Department determined that Global Hookah was

paying far less for some products than Fantasia was charging

some of its other distributor customers. No competent evidence

was produced as to why this disparity existed. The Department

simply surmised that Global Hookah was apparently misstating the

amounts it had paid Fantasia for the products. Th e Department,

based on its comparison of FantasiaÓs other non - related

invoices, determined that Global Hookah was understating those

product costs amounts by 454 percent .

16 . The Department thereupon applied a factor of 4.54 to

all of Global HookahÓs pu rchases and Florida sales for the

entire audit period. Although less than 20 percent of Global

HookahÓs purchases for that audit period were with Fantasia, the

factor was applied to all Florida sales in order to make the tax

assessment. 1/ The tax assessment on Global Hookah using the

revised cost figures was determined to be $305,374.76, plus

$152,687.37 of penalties, and $58,419.43 in interest, for a

total tax assessment of $516,481.53. The Department had taken

the purchases reported by G lobal Hookah on the monthly returns

filed during the audit period, multiplied that figure by 4.54 to

arrive at an adjusted figure, took the difference between the

reported amount and the adjusted figure, and made a tax

assessment on that amount.

17 . Lat er, the Department decided to revise its assessment

by removing some of the non - Fantasia purchases, resulting in a

tax assessmen t of $170,292.42 in tax, plus 1 percent interest

per month, plu s a penalty in the amount of 50 percent of the

assessment, for a total tax assessment of $241,818.77. The

basis for this reduction in tax assessment was that the

Department determined that the 454 percent mark - up based on the

Fantasia invoices should not necessarily be applied to the other

80 percent of Global HookahÓs purchases from other suppliers.

18 . Contrary to the DepartmentÓs position regarding the

Fantasia purchases, Mr. AppelÓs unrefuted testimony was that the

prices shown on the sales orders were the actual amounts paid by

Global Hookah to Fantasia. An aff idavit dated April 2, 2016,

from FantasiaÓs president, Randy Jacob, corroborated Mr. AppelÓs

testimony. 2/ That evidence is contrary to Mr. TorresÓ contention

that Global Hookah was falsifying its purchase price as to

products purchased from Fantasia. The Department presented no

competent evidence as to the basis for the prices Fantasia

charged Global Hookah for products. The DepartmentÓs position,

though based on logical reasoning in the abstract, was still

entirely speculative and unpersuasive. 3/

19 . The DepartmentÓs decision to rely upon Ðbest available

informationÑ is a new, unique way of conducting its review of

records for an audit. Mr. Torres stated that in 30 years , he

had not had to resort to such a process. The Department relied

upon the Ðbe st available informationÑ policy only in the instant

case. There is no evidence that the policy was to be used in

any other case or as a regular or appropriate method of dealing

with less than acceptable records. It was used in the case at

issue because Mr. Torres felt no other means would suffice.

20 . Global Hookah also contends that the DepartmentÓs

inclusion of federal excise tax, shipping costs and other

items in the taxable base for distributors constitutes an

unpromulgated rule. That issue, howev er, has already been

decided in DOAH Case No. 15 - 6108, Florida Bee Distrib utors , Inc.

v. Dep artment of Business and Prof essional Reg ulation , Case No.

15 - 6108 (DO A H Mar. 3, 2016)(ÐFlorida BeeÑ) , and will not be

addressed in this Recommended Order. The Final Order in Florida

Bee has been stayed and is currently under appeal at the First

District Co urt of Appeal, Case No. 1D16 - 1064, meaning that the

Department is free to rely on the policy pending a decision by

the appellate court.

CONCLUSIONS OF LA W

21 . The Department of Administrative Hearings has

jurisdiction over the parties to and the subject matter of this

proceeding pursuant to sections 120.569, 120.57(1), and

120.80(14)(b), Florida Statutes.

22 . Global Hookah alleges the Department has improperly

assessed a tax on its OTP sales during the audit period. The

Department has the initial burden of proving that Ðan assessment

has been made against the taxpayer and the factual and legal

grounds upon which the [Department] made the assessment.Ñ

§ 120.80(14)(b)2 . , Fla. Stat. The Department established that a

tax assessment had been made against Global Hookah. The factual

and legal grounds for that assessment were also established by

the evidence pres ented at final hearing. The Department met its

minimal burden in this case.

23 . The burden then shifts to Global Hookah to prove by a

preponderance of the evidence that the assessment is incorrect.

See § 120.57(1 ) (j); Fla. Stat.; IPC Sports, Inc. v. D epÓt of

Rev. , 829 So. 2d 330, 332 (Fla. 3d DCA 2002).

24 . As shown above, the Department rejected Global

HookahÓs evidence as to sales of OTP to Florida businesses

during the audit period. The Department had reasonable cause to

suspect the validity of Global HookahÓs records, but Global

Hookah proved that t hose records Î - although somewhat

inconsistent - Î reflected the actual amounts Global Hookah paid

its suppliers for the products. Those amounts should therefore

have been utilized by the Department to make the tax assessment.

Instead, the Department utilized a Ðbest available informationÑ

technique, making speculative assumptions based on records from

unrelated transactions.

25 . Global Hookah met its burden of proving the tax

assessment made by the De partment was incorrect.

26 . Section 210.276, Florida Statutes, grants the

Department the authority to asse ss a surcharge upon all

tobacco products and OTP at the rate of 60 percent of the

wholesale sales price. Section 210.30 allows for a tax in the

am ount of 25 percent of the wholesale sales price. Each of

these statutory sections specifically provides that no tax or

surcharge Ðshall be imposed by this section upon tobacco

products not within the taxing power of the state under the

Commerce Clause of the United States Constitution.Ñ

§§ 210.76(4) and 210.30(4) , Fla. Stat . In the present case,

Global Hookah says that it has no nexus with the State of

Florida and thus the Commerce Clause exception applies.

However, the Florida statutes address Ðtobacco productsÑ within

the StateÓs taxing power. Although Global Hookah is a foreign

corporation, it is transporting its tobacco products to Florida

for purchase and sale. Those products are subje ct to the

surcharge and tax in c hapter 210.

27 . Global Hookah has asked for attorneysÓ fees and costs

pursuant to two different statutory provisions, vi a section

57.105 and s ection 57.111 , Florida Statu t es .

28 . Section 57.105 states in pertinent part:

(1) Upon the courtÓs initiative or motion

of any party, the court shall award a

reasonable attorneyÓs fee, including

prejudgment interest, to be paid to the

prevailing party in equal amounts by

the losing party and the losing partyÓs

attorney on any claim or d efense at any

time during a civil proceeding or

action in which the court finds that

the losing party or the losing partyÓs

attorney knew or should have known that

a claim or defense when initially

presented to the court or at any time

before trial:

(a) Was not supported by the material facts

necessary to establish the claim or

defense, or

(b) Would not be supported by the

application of then - existing law to

those material facts.

* * *

(5) In administrative proceedings under

chapter 120, an administrative law

judge shall award a reasonable

attorneyÓs fee and damages to be paid

to the prevailing party in equal

amounts by the losing party and a

losing partyÓs attorney or qualified

representati ve in the same manner and

upon the same basis as provided in

subsections (1) - (4). Such award shall

be a final order subject to judicial

review pursuant to s. 120.68. If the

losing party is an agency as defined in

s. 120.52(1), the award to the

prevailing party shall be against and

paid by the agency. A voluntary

dismissal by a nonprevailing party does

not divest the administrative law judge

of jurisdiction to make the award.

29 . The Department reasonably suspected that Global

HookahÓs sales orders and/ or invoices were not completely

correct. The DepartmentÓs reliance on the Ðbest available

informationÑ theory was an attempt, albeit fallacious, to deal

with the presumably defective Global Hookah purchase and sales

documents. It cannot be said that the Department had no facts

which supported its claim for a tax assessment; however, the

facts ultimately proved insufficient to support the DepartmentÓs

ultimate actions. No award of attorneyÓs fees is warranted

under sect ion 57.105 .

3 0 . Section 57.111 states in pertinent part:

(2) The Legislature finds that certain

persons may be deterred from seeking

review of, or defending against,

unreasonable governmental action

because of the expense of civil actions

and administrative proceedings.

Because of the greater resources of the

state, the standard for an award of

attorneyÓs fees and costs against the

state should be different from the

standard for an award against a private

litigant. The purpose of this section

is to diminish the deterrent effect of

see king review of, or defending

against, governmental action by

providing in certain situations an

award of attorneyÓs fees and costs

against the state.

* * *

(4) Unless otherwise provided by law, an

award of attorneyÓs fees and costs

shall be made to a pr evailing small

business party in any adjudicatory

proceeding or administrative proceeding

pursuant to chapter 120 initiated by a

state agency, unless the actions of the

agency were substantially justified or

special circumstances exist which would

make the award unjust.

3 1 . Although the method employed by the Department to

establish Global HookahÓs tax assessment was ultimately deemed

erroneous, its attempted actions were substantially justified

under the circumstances which it faced. Again, no award of

attorneyÓs fees is warranted under section 57.111.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is

RECOMMENDED that a f inal o rder be entered by the Department

of Business and Professional Regulation, Division of Alcoholic

Beverages and Tobacco, that the tax assessment imposed against

Petitioner, Global Hookah Distributors, Inc. , is not correct and

that the wholesale sales price set forth in the taxpayerÓs

invoices and sales orders are the correct bases for calcula ting

the tax assessment.

It is FURTHER RECOMMENDED that no award of attorneysÓ fees

or costs is warranted in this matter.

DONE AND ENTERED this 20th day of October , 2016 , in

Tallahassee, Leon County, Florida.

S

R. BRUCE MCKIBBEN

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of A dministrative Hearings

this 20th day of October, 2016 .

ENDNOTES

1/ Although Global Hookah only makes less than 20 percent of its

purchases from Fantasia, and about 60 percent from Sierra

Network, Inc., the Department did not investigate whether

Fantasia was paying less for Sierra Network, Inc.Ós products

than other distributors were paying. The significance of the

DepartmentÓs analysis regarding the Fantasia invoices (only) i s

questionable.

2/ The Department objected to admission of the affidavit on the

basis of hearsay. While the affidavit is an out - of - court

statement offered for the truth of the matter asserted therein,

the affidavit Ðsupplemented and explainedÑ Mr. Appel Ós testimony

and is thus admissible. See § 120.57(1)(c), Fla. Stat. The

Department also complained that it did not have sufficient time

to depose the affiant, Mr. Jacobs, because the affidavit was not

disclosed by Global Hookah until ten days prior to th e final

hearing. Had the parties met 15 days prior to the hearing

pursuant to the Prehearing Order and exchanged exhibits, there

may have been ample time to conduct Î - at worst - Î a telephone

deposition of Mr. Jacobs.

3/ It must be noted that the credibili ty and weight of

Mr. TorresÓ testimony was signifi cantly reduced by the fact

that his attorney continuously offered extensive testimony in

the form of leading questions. It was difficult to ascertain

Mr. TorresÓ own knowledge versus his willingness to aff irm his

counselÓs statements.

COPIES FURNISHED:

Elizabeth A. Teegen, Esquire

Office of the Attorney General

The Capitol, Plaza Level 01

Tallahassee, Florida 32399 - 1050

(eServed)

Jonathan W. Taylor, Esquire

James F. McAuley, Esquire

Moffa, Sutton, and Donnini, P.A.

One Financial Plaza, Suite 2202

100 Southeast Third Avenue

Fort Lauderdale, Florida 33394

(eServed)

Sean J. Anderson, Esquire

Department of Business and

Professional Regulation

2601 Blair Stone Road

Tallahassee, Florida 32399

(eServed)

Gerald J. Donnini, II, Esquire

Joseph C. Moffa, Esquire

Moffa, Sutton, and Donnini, P.A.

One Financial Plaza, Suite 2202

100 Southeast Third Avenue

Fort Lauderdale, Florida 33394

(eServed)

James H. Sutton, Jr., Esquire

Moffa, Sutton, and Donnini, P.A.

One Financial Plaza, Suite 2202

100 Southeast Third Avenue

Fort Lauderdale, Florida 33394

Thomas Philpot, Director

Division of Alcoholic Beverages

And Tobacco

Department of Business and

Professional Regulation

Capital Commerce Center

2601 Blair Stone Road

Tallahassee, Florida 32399

(eServed)

Jason L. Maine, General Counsel

Department of Business and

Professional Regulation

Capital Commerce Center

2601 Blair Stone Road

Tallahassee, Florida 32399 - 2202

(eServed)

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the Final Order in this case.