Category: Litigation

Prosecution for Exchanging Price Info

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The Belgian Competition Authority (BCA) has decided to prosecute Philip Morris Benelux, Établissements L. Lacroix Fils, JT International Company Netherlands and British American Tobacco Belgium for the exchange of information on prices between competitors.
Together, the accused parties account for 90 percent of cigarette consumption in Belgium. The competition prosecutor alleges the existence of anticompetitive practices that lasted for several years and consisted of repeated exchanges of information on their future prices through wholesalers.
According to a BCA press release, the manufacturers sent information on their own future prices to their wholesalers and, through the wholesalers, received information on the future prices of their competitors.
Such conduct may be contrary to Article IV.1 CEL and Article 101 TFEU, according to the BCA.
This case will now be examined by the Competition College. The defendants will have an opportunity to defend themselves against these objections in front of the college. The parties will be able to submit written comments to the Competition College and will be heard at a hearing.
October 28, 2021
Court: Triton Can Sell Flavored E-Cigs Despite MDO

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The 5^th U.S. Circuit Court of Appeals has ruled that Triton Distribution can continue selling its flavored e-cigarettes despite a decision to the contrary by the Food and Drug Administration, reports Reuters.
In a unanimous opinion on Oct. 26, the 5th U.S. Circuit Court of Appeals said that when the FDA last month denied the Texas company’s application to sell its products, the agency did not adequately consider Triton’s marketing plan to reduce the products’ appeal to youth.
The court found the FDA pulled a “surprise switcheroo” from earlier guidance stating that manufacturers would not need long-term studies to support e-cigarette applications.
The FDA initially said in guidance accompanying the deeming rule that it did not expect companies would need long-term studies to support their application. However, in an August announcement that it would deny a first batch of applications, the agency said that manufacturers would likely need studies that followed a cohort of people over time to show that their products’ use in helping adult smokers quit cigarettes outweighed the risk to youth.
Triton challenged the agency’s decision, saying it had relied on the earlier guidance in its application.
Multiple companies have challenged their MDOs in recent weeks. In early October, the FDA rescinded MDOs it has issued to Turning Point Brands and Fumizer, placing their products back under review.
More recently, the FDA issued an administrative stay of its MDO for nontobacco flavored bidi sticks, pending the agency’s review of Bidi Vapor’s request that the MDO be rescinded based on product-specific scientific evidence in its PMTAs.
According to Filter, Bidi and Gripum too recently received some temporary form of stay, and My Vape Order has demanded a recission due to the fact its PMTA includes some of the same data and studies that also appears in TPB’s applications.

October 28, 2021
Triton May Sell ENDS Pending MDO Review

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Wages and White Lion Investments, parent to Triton Distribution, may continue to market its electronic nicotine delivery system (ENDS) devices in the U.S. until its appeal against the Food and Drug Administration’s marketing denial orders (MDO) has been evaluated in court.
On Oct. 15, the U.S. Court of Appeals for the Fifth Circuit put the MDO on hold pending review. The judges also granted motions to expedite the appeal case and a ruling for emergency relief.
Triton Distribution filed a motion to stay after the FDA denied the company’s premarket tobacco product application. The company claims that it had been irreparably harmed as a result of the FDA’s actions and faced an imminent shutdown of its business.
In its motion, Triton contends that the FDA retroactively changed the requirements for PMTAs. “By imposing a new, across-the-board requirement that flavored ENDS products be demonstrably more effective at promoting smoking cessation than otherwise identical tobacco-flavored products, FDA acted contrary to its authority under Section 910 of the Food, Drug and Cosmetic Act (“FDCA), 21 U.S.C. § 387j, and not in accordance with law,” Triton wrote.
At least six companies have filed lawsuits challenging the agency’s decision to make the companies remove their products from the market. Last week, the FDA rescinded the MDO issued to Turning Point Brands and the company will be allowed to continue marketing its vapor products while the FDA re-reviews the company’s PMTA.
October 15, 2021
First Lawsuits Filed Over Marketing Denials

Turning Point Brands has challenged the Food and Drug Administration’s orders that denied some of the company’s products access to the U.S. market. The company first filed a petition for review with the U.S. Court of Appeals for the Sixth Circuit. TPB then filed an emergency motion to stay the FDA’s order to remove TPB’s products from the market.
TPB is asking the court to review the FDA order “on the grounds that it is arbitrary and capricious, an abuse of discretion, contrary to the Federal Food, Drug and Cosmetic Act, as amended by the Family Smoking Prevention and Tobacco Control Act of 2009, and otherwise not in accordance with law.” The company requests the court “vacate or modify” the FDA order and asks that TPB be allowed to “continue to market the products subject to the challenged order.”
TPB accuses the FDA of moving the goalposts for data needed to receive a marketing order based on what the agency “learned” from the “review [of] PMTAs for flavored ENDS so far,” according to the stay. TPB noted that the “North Star of administrative law” is that agencies cannot induce regulated parties to rely on “agency representations about regulatory requirements,” then penalize them using the previously unannounced criteria after the fact.
“But that is precisely what FDA did here,” the stay motion states. “[The] FDA reasoned that TPB failed to conduct ‘a randomized controlled trial and/or longitudinal cohort study’ or other studies performed ‘over time’ to show that TPB’s specific flavored products help adult users stop smoking more than tobacco-flavored products do. Yet FDA previously deemed these studies unnecessary.”
Bidi Vapor and at least one other company have reportedly filed similar suits.
October 4, 2021
Juul Settlement to Fund Anti-Vaping Research

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North Carolina will use the $40 million settlement with Juul Labs, announced in June by Attorney General Josh Stein, to help fund research to stop the use of electronic cigarettes among young people, reports The Fayetteville Observer.
“For years, Juul targeted young people, including teens, with its highly addictive e-cigarette,” said Stein. “It lit the spark and fanned the flames of a vaping epidemic among our children—one that you can see in any high school in North Carolina. This win will go a long way in keeping Juul products out of kids’ hands, keeping its chemical vapor out of their lungs and keeping its nicotine from poisoning and addicting their brains.”
Juul Labs will pay North Carolina $13 million in the first year, $8 million the second year, $7.5 million the third year, $7 million the fourth year and $2.25 million the fifth and sixth years. The payout is set to fund programs conducting research and prevention of electronic cigarettes, according to Travis Greer, regional tobacco control manager for the Cumberland County Health Department.
September 29, 2021
States Urged to Act Absent Action on Majors

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The Campaign for Tobacco-Free Kids (CTFK) is urging U.S. states and cities to step up their efforts to eliminate all flavored nicotine products, including e-cigarettes, in the wake of the Food and Drug Administration’s failure to rule on the premarket tobacco product applications (PMTAs) of market leaders Juul, Vuse, NJOY, Blu and Logic by yesterday’s deadline.
On Sept. 9, the FDA announced it had denied market access to nearly 1 million electronic nicotine-delivery devices owned primarily by smaller vapor companies. At the same time, the agency indicated it would require more time to process the remaining PMTAs, including those submitted by Juul Labs, BAT, NJOY, Imperial Brands and Japan Tobacco International, which account for the lion’s share of U.S. e-cigarette sales. Juul alone has a U.S. market share of more than 40 percent.
“The FDA will leave our kids at risk unless it acts quickly on the remaining applications, including for products like Juul that have driven the youth e-cigarette epidemic, and eliminates all flavored e-cigarettes, including menthol-flavored products that are widely used by kids,” wrote CTFK President Matthew L. Myers in a statement. “Every day these products remain on the market, our kids remain in jeopardy.”
The FDA’s failure to act on the market leaders is remarkable given that the agency had previously indicated it would prioritize those brands while processing marketing applications. Decisions on the best-selling brands would likely have the greatest impact on public health, the agency explained in earlier communications. The failure also raises legal questions, considering that the Sept. 9 deadline was ordered by a court following litigation from public health groups, including the CTFK.
The CTFK indicated if the FDA does not decide on major applications soon, it would return to court to have the court enforce its order requiring the FDA to begin removing unauthorized products.
September 10, 2021
Multimillion Dollar Verdict in Engle Case

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A Florida jury returned a $43 million verdict against Philip Morris on Aug. 3 after finding the company responsible for the cancer death of a woman who had smoked the company’s Virginia Slims cigarettes, reports the Courtroom View Network.
The verdict includes $15 million in compensatory damages and $28 million in punitive damages for the 1993 lung cancer death of Norma Lipp.
Lipp had smoked between one and two packs of cigarettes a day for decades, including those of the Virginia Slims brand for 15 years.
Her family claims Philip Morris conspired to hide the dangers of smoking, hooked her to nicotine and caused her fatal cancer.
The case is among thousands that stem from Engle v. Liggett Group Inc., a 1994 Florida class-action lawsuit against the nation’s tobacco companies that led to a plaintiffs’ verdict at trial.
The state’s supreme court later decertified the class but ruled that “Engle progeny” cases may be tried individually.
September 7, 2021
Juul Class Action Moves Closer to Trial

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An expansive class action lawsuit against Juul Labs inched closer to trail when a federal judge advanced conspiracy and fraud claims against the company’s founders, board members and biggest investor, Altria Group, reports Court House News Service.
On July 22, U.S. District Judge William Orrick III refused to dismiss the bulk of claims filed by 19 plaintiffs in 14 states. The suit accuses Juul and its leaders of intentionally using deceptive ads and marketing campaigns to get young people hooked on vaping to create a new generation of nicotine addicts.
The plaintiffs say Juul failed to warn consumers that its e-cigarette products were highly addictive and that the company falsely claimed in ads and labels that its prefilled pods contained 5 percent nicotine, the same amount in a pack of cigarettes, when the pods contained much higher levels. They also say Juul fraudulently marketed its vaping products as a “safer alternative” to combustible cigarette smoking.
The plaintiffs seek to hold Juul and Altria Group liable for fraud, negligence, negligent misrepresentation, strict product liability and medical monitoring.
Judge Orrick rejected requests by Juul founders and top executives James Monsees and Adam Bowen to dismiss the claims against them, finding the plaintiffs “adequately alleged that both Monsees and Bowen engaged in acts that had the intent and impact of misleading the public and plaintiffs about the dangers of Juul.”
Orrick also rejected Altria’s motion to dismiss, citing meetings that occurred between Altria and Juul in California regarding the development of “business agreements and arrangements through which Altria supported [Juul]’s manufacturing, regulatory, marketing and distribution efforts and how Altria’s efforts through [Juul] in California achieved their common goals.”
Orrick found many of the arguments made by Altria and Juul’s founders and directors cannot be adequately evaluated until a later stage of litigation when more evidence is available for a jury or judge to scrutinize.
July 23, 2021
Heated Tobacco Exempted from Ban

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Mexico’s Supreme Court has ruled that heated-tobacco products (HTPs) will be exempted from a February 2020 presidential decree that bans importation of electronic nicotine-delivery systems (ENDS), reports Filter.
Prior to the on July 16 ruling, manufacturers were able to import and sell HTPs legally using a loophole in the law called “habeas corpus trials.” But the loophole prevented the development of a fully regulated, legal market. The new presidential decree reverses that and allows for increased sales of these devices.
Vapor products that use e-liquids continue to be banned by the Mexican government. According to Roberto Sussman, a researcher at the National University of Mexico and president of Pro-Vapeo Mexico, the vapor market in Mexico has been functioning since 2009 as part of the huge informal economy, which employs more than 50 percent of the workforce, and it is illegal but not criminal.

It was an embarrassment for President Andres Manuel Lopez Obrador, who has expressed opposition to foreign NGOs and agents meddling with Mexican government regulations.
Roberto Sussman, president, Po-Vapeo Mexico
More than 1.2 million Mexicans—1 percent of the adult population—use vapor products somewhat regularly, according to a survey by the Global State of Tobacco Harm Reduction.
According to Filter, a fatal blow to the HTP ban came when it was leaked that the draft of the decree was written by a lawyer working for the Campaign for Tobacco-Free Kids.
“It was an embarrassment for President Andres Manuel Lopez Obrador, who has expressed opposition to foreign NGOs and agents meddling with Mexican government regulations,” said Roberto Sussman.
It’s not the first time Mexico’s Supreme Court intervened in the country’s drug policy. On June 28, it stepped in to legalize marijuana after lawmakers had failed to finalize the legislation the court demanded three years earlier.
July 23, 2021
Cigar/Pipe Rules and Fees Upheld in Court

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The U.S. Food and Drug Administration properly implemented federal law when it extended certain cigarette rules to other tobacco products and when it assessed fees on cigars and pipe tobacco, the U.S. Court of Appeals for the District of Columbia Circuit ruled on June 20, according to Reuters.
The court unanimously rejected a challenge by the Cigar Association of America, Cigar Rights of America and Premium Cigar Association to aspects of the FDA’s Deeming Rule subjecting cigars and pipe tobacco to the same regulatory framework as cigarettes.
The FDA adopted the Deeming Rule in 2016, identifying a wide range of tobacco products, including cigars and pipe tobacco to be subject to its regulatory authority under the Family Smoking Prevention and Tobacco Control Act of 2009.
The industry groups challenged the rule in the District of Columbia. Some aspects of that challenge have been successful, as when the D.C. Circuit last year overturned a warning label requirement for cigar and pipe tobacco products.
In its recent ruling, however, the appeals court upheld the FDA’s authority to require cigar and pipe tobacco products to undergo premarket review or for manufacturers to provide “substantial equivalence reports” (SE) showing that a product is equivalent to one already on the market before 2007.
The cigar groups had challenged that rule on the grounds that the FDA failed to provide product-specific instructions on how to prepare SE reports and did not consider the cost and benefits of premarket review specifically for each industry or product. They also challenged the user fees on the grounds that the agency did not impose similar fees on other newly deemed products such as e-cigarettes.
Circuit Judge Judith Rogers wrote that it was unnecessary to address whether the law required the FDA to provide the instructions because the agency had said it would give companies 18 months to submit SE reports. She argued that even if the FDA were required to provide instructions, it did not have to do so as part of the rule but could do so later.
Rogers also upheld the agency’s user fees on cigar and pipe tobacco manufacturers and importers, arguing that the Tobacco Control Act specifically gave the FDA authority to impose fees on cigarettes, cigars, snuff, chewing tobacco, pipe tobacco and roll-your-own tobacco.
Anti-smoking activists described the court ruling as “a win for kids, their families and the public health.”
“The D.C. Court of Appeals’ unanimous decision upholding the premarket review provisions of the FDA’s Deeming Rule for cigars will finally force cigar makers to show that their products are substantially equivalent to products that were already on the market before the passage of the landmark Tobacco Control Act,” said Matthew L. Myers, president of the Campaign for Tobacco-Free Kids, in a statement.
“Cigarettes have been subject to FDA regulation since the enactment of the Tobacco Control Act in 2009, but cigar makers were entirely unregulated for seven years until the Deeming Rule subjected them to minimal regulations.”
July 23, 2021