No, that isn't normal. The manual says that Sotars are test sprayed after assembly and that there may be some paint residue left in the brush. Maybe that's the problem. I'd pull the needle and then tear the front of the brush apart and see what I find. Take a look at the manual and you'll see how it comes apart. The regulator screws off and there's a hold down ring for the tip/nozzle. After you take those off the tip will drop out. The tip is tiny so you may want to hold the brush with the tip pointing straight up when you take it apart and lay a rag or paper towel on your bench so if you drop the tip it doesn't bounce or roll off somewhere. Then you can use the little wrench to loosen the head assembly and take it off. There's a teflon washer on the backside of the head but it may stick to the front of the brush body. Don't loose it.
Once you get it apart take a look at all the little holes in the regulator, hold down and head. Something may be blocking air flow there. If you look at the front of the airbrush body you'll see a smaller hole below the one the head screws into. That's the air passage. Hook the brush back to the compressor and push the trigger down to see what kind of air flow you're getting. Might want to hold a rag or paper towel or something in front of it to catch anything that may blow out. At least then you could see what it was. There's no parts that will come out but maybe there's a chip or something in there stopping things up.
If airflow is good there then put the head of the brush back together one part at a time and blow some air though to see what happens. But don't set the tip/nozzle in and blow air, screw the hold down ring on first.
If you don't have good airflow with the head and everything off the front of the brush then there's either something stuck in that air passage or there's a problem with the airvalve. You could run a piece of stiff wire (or a small brush if you have one) down that passage and see if there's anything blocking it. Just don't force anything and be gentle with it. That passage ends at the airvalve. The next step is to remove the air valve and take it apart. It might be easier if you take off the finger rest first, there's a little setscrew in the back of it. Loosen it and the finger rest will slip off. The airvalve will probably be tight and you may need a pair of pliers to loosen it. If you clamp down on that little knurled ring on the valve with a pair of pliers you'll proabably mess it up so wrap a piece of leather or rubber around it and then apply the pliers. It won't be real tight but probably enough that you can't loosen it with your fingers.
After you get it off hold the brush upside down and run your wire or whatever into the air passage from the front of the brush again. You should be able to see it when it comes into the hole you took the airvalve out of. If you didn't find anything in that passage you can take the airvalve apart. If you look at it from the bottom where the hose screws on you'll see that the plug in the bottom of it has a hex shaped opening and you can use a small allen wrench to screw that out. There's a spring inside so it will be putting pressure on that plug. Take care when you screw it out that nothing flys away. Once you get the plug out the spring will come out and so will the plunger and o-ring. Check the hole or holes in the body of the valve. If there's nothing in there that isn't supposed to be and the o-ring is in good shape then I don't know what may be wrong. If you do take the airvalve apart it may be easier to take it apart first and then screw the airvalve body out of the airbrush.
Chances are, you'll either find something in the head of the brush or in that air passage in the body. The only other thing I can think of is if there is a gasket or seal in the fitting on your airhose that screws onto the airbrush and it's blocking air. Seems to me that there's a little cork gasket in there in some hoses. Maybe it's come apart or out of place.
Or, you could contact Badger and tell them what's going on. I'm sure they'll help you out. The Sotar is a fine little brush and should spray even below 10psi. I've used mine at 5.
Tony
PS...Be careful with the needle, it's delicate. Doesn't take much to bend the tip of it.