ORDER

R. BRYAN HARWELL, District Judge.

This matter is before the Court on Defendants' motion to dismiss made pursuant to Federal Rule of Civil Procedure 12(b)(1) and 12(b)(6). See ECF No. 26. The Court grants Defendants' motion for the reasons set forth below.

Background

The factual and procedural history of this case and the underlying administrative proceeding are fully set forth in this Court's March 9, 2016 order. See ECF No. 25, available at 2016 WL 892661. In brief, Tobaccoville USA, Inc. ("Tobaccoville") holds a tobacco products importer permit issued by the Alcohol and Tobacco Tax and Trade Bureau ("TTB").1 Due to new regulations issued by TTB, Tobaccoville had to reapply for a permit.2 TTB issued a notice of contemplated disapproval of Tobaccoville's permit application, and Tobaccoville contested the contemplated disapproval by requesting a hearing before an administrative law judge. Despite the ongoing administrative proceeding, Tobaccoville has filed the instant action in this Court against TTB and two individual defendants3 (collectively, "Defendants") seeking declaratory and injunctive relief.4 Defendants have now filed a motion to dismiss pursuant to Rule 12(b)(1) and Rule 12(b)(6) of the Federal Rules of Civil Procedure. ECF No. 26. Tobaccoville has filed a response in opposition (with exhibits), and Defendants have filed a reply. See ECF Nos. 27 & 28.

Discussion

Defendants move to dismiss Tobaccoville's claims pursuant to both Federal Rule of Civil Procedure 12(b)(1) (lack of subject matter jurisdiction) and 12(b)(6) (failure to state a claim upon which relief can be granted), arguing Tobaccoville has failed to exhaust its administrative remedies.5 "There is some uncertainty as to whether a failure to exhaust administrative remedies is properly brought in a Rule 12(b)(1) motion, as a jurisdictional defect, or in a Rule 12(b)(6) motion for failure to state a claim."6 Temples v. U.S. Postal Serv., No. 3:12-cv-00034-JFA-SVH, 2012 WL 1952655, at *2 (D.S.C. May 8, 2012), adopted by, 2012 WL 1952299 (D.S.C. May 30, 2012). Notably, the United States Court of Appeals for the Fourth Circuit "has characterized exhaustion as a jurisdictional requirement" that is "more properly addressed under Rule 12(b)(1), instead of Rule 12(b)(6)." Agolli v. Office Depot, Inc., 548 F. App'x 871, 875 (4th Cir. 2013) (citing Balas v. Huntington Ingalls Indus., Inc., 711 F.3d 401, 406 (4th Cir. 2013)). Moreover, Rule 12(b)(1) would appear to be the more appropriate vehicle, given that Tobaccoville has submitted various exhibits in support of its response in opposition to Defendants' motion to dismiss. See ECF Nos. 27-1 through 27-8; Goldfarb v. Mayor & City Council of Baltimore, 791 F.3d 500, 506 (4th Cir. 2015) ("When a defendant challenges subject matter jurisdiction via a Rule 12(b)(1) motion to dismiss, the district court may regard the pleadings as mere evidence on the issue and may consider evidence outside the pleadings without converting the proceeding to one for summary judgment."); Melendez v. Sebelius, 611 F. App'x 762, 763 (4th Cir. 2015) ("Where a challenge under Rule 12(b)(1) is raised to the asserted basis for subject matter jurisdiction, the burden of proving the asserted basis for jurisdiction falls on the plaintiff."). In any event, Tobaccoville's case must be dismissed because it has not exhausted its administrative remedies.

"It is a `long-settled rule of judicial administration that no one is entitled to judicial relief for a supposed or threatened injury until the prescribed administrative remedy has been exhausted.'" Cavalier Tel., LLC. v. Virginia Elec. & Power Co., 303 F.3d 316, 322 (4th Cir. 2002) (quoting Myers v. Bethlehem Shipbuilding Corp., 303 U.S. 41, 51 (1938)). "In other words, `[w]here relief is available from an administrative agency, the plaintiff is ordinarily required to pursue that avenue of redress before proceeding to the courts; and until that recourse is exhausted, suit is premature and must be dismissed.'" Id. (alteration in original) (quoting Reiter v. Cooper, 507 U.S. 258, 269 (1993)). "The exhaustion requirement serves many purposes, not the least of which are to allow an agency the opportunity to use its discretion and expertise to resolve a dispute without premature judicial intervention and to allow the courts to have benefit of an agency's talents through a fully developed administrative record." Thetford Properties IV Ltd. P'ship v. U.S. Dep't of Hous. & Urban Dev., 907 F.2d 445, 448 (4th Cir. 1990) (internal citation omitted).

Exhaustion is required where Congress explicitly mandates it. Cavalier, 303 F.3d at 322. "Even where the statutory requirement of exhaustion is not explicit, courts are guided by congressional intent in determining whether application of the doctrine would be consistent with the statutory scheme." Id. "Thus, every exhaustion inquiry begins with a look at congressional intent and the relevant statutory scheme." Barnes v. Int'l Amateur Athletic Fed'n, 862 F.Supp. 1537, 1542 (S.D.W. Va. 1993).

TTB's administrative regulations provide for three levels of administrative review, as summarized in Defendants' motion to dismiss. See ECF No. 26-1 at 3 (citing 27 C.F.R. §§ 71.78, 71.107, 71.116). First, an administrative law judge ("ALJ") conducts a hearing on the permit application and recommends a decision to the TTB Officer. 27 C.F.R. § 71.78. The Officer then makes an initial decision on whether the permit should be issued; if the Officer concludes the permit should be issued, the application is approved. Id. § 71.107. However, if the Officer contemplates disapproval, the Officer serves the ALJ's recommendation on the applicant, informs the applicant of the contemplated disapproval, and affords the applicant the ability to submit proposed findings and conclusions or exceptions to the recommendation. Id. The Officer then reviews the applicant's submission and makes the initial decision. Id. If the Officer does not approve the application, the applicant may appeal to the TTB Administrator, who makes the final decision.7 Id. § 71.116. Significantly, the regulations provide that "[a]n appeal to the Administrator is required prior to application to the Federal courts for review." Id. § 71.115 (emphasis added).

At the time Defendants filed their motion to dismiss (April 18, 2016), an ALJ had already conducted a hearing on March 2 and 3, 2016, and was in the process of recommending a decision to the TTB Officer.8 See ECF No. 26-1 at 3. Defendants noted that even assuming the ALJ proposed adverse action on Tobaccoville's permit application, Tobaccoville still had to proceed through two more levels of administrative review—via the Officer and the Administrator—before it could seek judicial review by this Court. Id. at 4.

In its response to Defendants' motion to dismiss, Tobaccoville does not dispute that administrative proceedings are ongoing. See ECF No. 27. However, Tobaccoville argues:

Id. at 1. Tobaccoville justifies these arguments by citing McCarthy v. Madigan, 503 U.S. 140 (1992), wherein the United States Supreme Court extensively discussed the general principles of exhaustion and limited exceptions thereto. See 503 U.S. at 144-49. The Supreme Court stated, "[A]dministrative remedies need not be pursued if the litigant's interests in immediate judicial review outweigh the government's interests in the efficiency or administrative autonomy that the exhaustion doctrine is designed to further." Id. at 146. The Supreme Court then outlined "three broad sets of circumstances in which the interests of the individual weigh heavily against requiring administrative exhaustion"; those circumstances include: (1) when requiring exhaustion may unduly prejudice subsequent court action; (2) when an agency's remedy may be inadequate; and (3) "where the administrative body is shown to be biased or has otherwise predetermined the issue before it." Id. at 146-48 (emphasis added). Tobaccoville relies on the third of these circumstances, arguing "TTB pre-determined its denial of Tobaccoville's import permit, rather than conducting an impartial investigation and review." ECF No. 27 at 1-2 (emphasis added).

To support its predetermination argument, Tobaccoville has submitted excerpts from the administrative record, including testimony from the administrative hearing that occurred before the ALJ on March 2 and 3, 2016.9 See ECF Nos. 27-1 through 27-8. Tobaccoville argues this evidence shows that TTB engaged in "an excessive and deliberate attempt to revoke, cause surrender of, or deny Tobaccoville a tobacco importer permit on any grounds"; and that TTB "did not actually conduct an investigation of Tobaccoville's permit application, did not apply the very standards which it had represented would be applied to permit applications, but instead simply walked through a sham process to reach a foregone conclusion." ECF No. 27 at 2, 4.

Specifically, Tobaccoville argues the evidence shows TTB began its investigation in 2009 knowing there were no regulations in place limiting the duration of Tobaccoville's permit, and that TTB nonetheless attempted to persuade Tobaccoville to surrender its permit. ECF No. 27 at 2 (citing ECF Nos. 27-1 & 27-2). Tobaccoville further contends that after two of its officers entered felony Alford10 pleas in 2011, TTB initiated another investigation and issued a rule to show cause why Tobaccoville's permit should not be revoked under a recently enacted statute.11 Id. at 2-3 (citing ECF Nos. 27-3 & 27-4). Tobaccoville points out that, during the pendency of the revocation proceedings, TTB promulgated an emergency temporary regulation requiring all tobacco import permit holders with a permit issued before August 26, 2013, to reapply.12 Id. at 3 (citing ECF Nos. 27-5 & 27-6). Finally, Tobaccoville asserts TTB searched for another way to prevent Tobaccoville from importing by sending a Notice of Contemplated Disapproval that alleged underpayment of certain excise taxes and completely ignored the mandatory statutory procedure for assessing and collecting unpaid excise taxes. Id. at 3-4 (citing ECF No. 27-7 & 27-8).

The Court finds Tobaccoville has failed to make a sufficient showing that TTB was biased or predetermined the issue of Tobaccoville's permit application such that administrative exhaustion is not required. See McCarthy, 503 U.S. at 148. It is clear Tobaccoville believes TTB intentionally targeted it by promulgating post hoc regulations that required it to reapply for a permit, and by arbitrarily disregarding tax collection procedures. However, the evidence submitted by Tobaccoville does not support a conclusion that Tobaccoville cannot present its concerns in the three-step administrative review process afforded by TTB. See 27 C.F.R. §§ 71.78, 71.107, 71.116. If anything, the evidence itself illustrates how Tobaccoville was able to elicit testimony pertaining to those concerns at the March 2016 hearing before the ALJ; notably, seven of the eight exhibits attached to Tobaccoville's response are taken from evidence (live testimony and an exhibit) presented at that hearing. See ECF Nos. 27-1, 27-2, 27-3, 27-4, 27-5, 27-7, & 27-8. Moreover, even though the ALJ recently issued an unfavorable decision recommending disapproval of Tobaccoville's permit application,13 Tobaccoville still has two levels of administrative review available via the TTB Officer and the TTB Administrator. See 27 C.F.R. §§ 71.107, 71.116; McCarthy, 503 U.S. at 145 ("The exhaustion doctrine . . . acknowledges the commonsense notion of dispute resolution that an agency ought to have an opportunity to correct its own mistakes with respect to the programs it administers before it is haled into federal court. . . . [E]ven where a controversy survives administrative review, exhaustion of the administrative procedure may produce a useful record for subsequent judicial consideration, especially in a complex or technical factual context."). Tobaccoville has not presented sufficient evidence suggesting the result has been predetermined at any of the three exhaustion levels of administrative review. See Thetford Properties, 907 F.2d at 450 ("Absent a clear showing that an administrative agency has taken a hard and fast position that makes an adverse ruling a certainty, a litigant's prognostication that he is likely to fail before an agency is not a sufficient reason to excuse the lack of exhaustion.").

Most significantly, the regulations for TTB's administrative review process provide that "[a]n appeal to the Administrator is required prior to application to the Federal courts for review." 27 C.F.R. § 71.115 (emphasis added). This regulation alone is arguably sufficient reason for administrative exhaustion to be a prerequisite for judicial review in this Court. See Sims v. Apfel, 530 U.S. 103, 108 (2000) ("[I]t is common for an agency's regulations to require issue exhaustion in administrative appeals. And when regulations do so, courts reviewing agency action regularly ensure against the bypassing of that requirement by refusing to consider unexhausted issues." (internal citations omitted)).

As noted above, Tobaccoville argues, "The Constitutional issues presented in this case are such that Tobaccoville's interest in prompt access to judicial review, under normal judicial process, outweighs the government's interest in efficiency or administrative autonomy." ECF No. 27 at 1. Tobaccoville further contends exhaustion is not required because TTB's actions violate Tobaccoville's due process and equal protection rights, as well as the takings clause. Id. at 4. However, the Fourth Circuit has squarely "reject[ed] the argument that, as a general rule, exhaustion is not necessary where administrative litigants raise constitutional challenges." Thetford Properties, 907 F.2d at 448. Furthermore, the Court recognizes the exceptions to the exhaustion requirement—including predetermination—apply only in the "rare" and "extreme" case when "an agency has taken a clearly unconstitutional position." Id. The instant case does not meet these criteria, and "the constitutional focus of Tobaccoville['s] claim does not relieve [it] of [its] obligation to pursue and exhaust [its] remedies before" TTB. Id. at 449.

The Court must address one final matter. In its response, Tobaccoville states it "does not ask the Court to prevent the conclusion of the administrative process at this time, but, rather simply to stay this action instead of dismissing it, so that Tobaccoville's Constitutional rights with respect to the litigation, including its right to a full record development, may be within this Court's purview upon completion of the administrative process."14 ECF No. 27 at 2. However, as explained above, constitutional challenges are no exception to the exhaustion requirement. See Thetford Properties, 907 F.2d at 448 ("[E]xhaustion is particularly appropriate when the administrative remedy may eliminate the necessity of deciding constitutional questions. This principle is nothing more than a necessary corollary to the fundamental rule of judicial restraint that a court ought not to pass on questions of constitutionality unless such adjudication is unavoidable." (internal citations and quotation marks omitted)). If TTB ultimately grants Tobaccoville's permit application, such administrative action may very well result in a satisfactory end to the matter without requiring this Court to adjudicate Tobaccoville's constitutional claims. See id. at 447-48 (affirming the district court's dismissal for failure to exhaust and explaining "requiring exhaustion here may very well lead to a satisfactory resolution of this controversy without having to reach appellants' constitutional challenge.").15 The Court sees no reason why this case should remain open while Tobaccoville is litigating its claims at the various levels of TTB administrative review.16 Accordingly, the Court finds a stay is not warranted and will instead dismiss this action without prejudice to Tobaccoville's right to refile after exhausting administrative remedies.

Conclusion

The Court has thoroughly reviewed the entire record, the parties' arguments, and the applicable law. Having done so, the Court finds Tobaccoville has not shown TTB was biased or predetermined the issue of Tobaccoville's permit application such that administrative exhaustion is not required. See McCarthy, 503 U.S. at 148. Accordingly, the Court GRANTS Defendants' Motion to Dismiss [ECF No. 26] and DISMISSES this action without prejudice.

IT IS SO ORDERED.