The U.S. International Trade Commission (ITC) will investigate Altria and Philip Morris after a complaint was filed by R.J. Reynolds. The ITC will look into certain tobacco heating elements and components.
The ITC has not made a decision on the case but has said it will make its “final determination … at the earliest practicable time.”
Philip Morris USA filed a lawsuit on May 6 in the U.S. District Court for the District of Columbia to block the graphic cigarette warnings that tobacco companies will be required to print on their products in the United States starting June 18, 2021.
It follows a similar lawsuit filed last month by other tobacco companies in the U.S. District Court for the Eastern District of Texas.
This is the Food and Drug Administration’s (FDA) second attempt to enact graphic health warnings under the 2009 Family Smoking Prevention and Tobacco Control Act. The first rule was struck down by the federal court in the District of Columbia as a violation of the First Amendment. The plaintiffs in Texas case state that this version of the FDA’s rule is no improvement and urge the court to strike down both the rule and the Tobacco Control Act’s graphic-warnings requirement as violations of the First Amendment.
The companies allege that FDA’s required warnings force plaintiffs to become a “mouthpiece for the government’s anti-smoking advocacy” and are “precisely the type of compelled speech that the First Amendment prohibits.”
The new rule includes 11 graphic images paired with textual warnings. Among other smoking-related afflictions, the images depict a person with neck cancer, ill children and bloody urine
Also on May 6, the plaintiffs and the government in the Texas case jointly proposed to delay the implementation date for the graphic warnings for four months, from June 18, 2021, to Oct. 16, 2021.
Public health advocates expressed outrage at the legal challenge. “It is truly shameless for tobacco companies to file these lawsuits at a time when there is clear evidence that smoking can increase risk of severe complications and even death from Covid-19,” said Matthew L. Myers, president of the Campaign for Tobacco-Free Kids.
“We urge the Administration to vigorously defend these warnings in court and urge the court to reject the proposed four-month delay.”
The tobacco industry is threatening legal action after South Africa reversed a decision to end its ban on the sale of tobacco products.
To prevent the spread of the coronavirus, the government earlier this year suspended sales of cigarettes. The ban was scheduled to end on May 1, but on Wednesday, the government suddenly reversed course after it received 2,000 requests to keep the measure in place.
Retailers had placed thousands of orders for cigarette and vapor products ahead of the anticipated lifting of the ban.
Smokers across the country fumed, with an online petition garnering close to half a million signatures by May 1.
British American Tobacco (BAT) South Africa complained that, unlike the ban’s supporters, the tobacco industry, retailers and tobacco consumers were not given an opportunity to comment on the proposed reinstatement of the ban.
“This was grossly unfair and unlawful,” said BAT, adding that the online petition of more than 400,000 in favor of lifting the ban dwarfed the 2,000 individual submissions.
Meanwhile, the Fair Trade Independent Tobacco Association said it was confident of overturning the ban, having decided to proceed with legal action after the government’s backtrack.
“We had a meeting with our legal team, and the decision was unanimous, and we will be proceeding with the legal steps,” said chairperson Sinenhlanhla Mnguni.
Shadrack Sibisi, chairperson of the South Africa Tobacco Transformation Alliance, which represents black emerging tobacco farmers, said the continued ban would impact more than 8,000 workers and 30,000 dependents.
“Our losses are huge. From March 27 until today, we have sold nothing,” he said. “We harvested in early January and were ready to go, but then lockdown happened. We have been sitting with boxes ready, and now with the recent rains we are going to have to redry and repackage. The tobacco still needs to be processed.”
Others applauded the government’s decision to continue the tobacco sales ban, saying that health considerations supersede commercial interests. “While the right of the individual is important, when we are facing a crisis that poses a danger to society, the rights of the collective to health must take precedence,” said Professor Pamela Naidoo of the Heart and Stroke Foundation.
Association Presses on With Challenge Against South Africa’s Tobacco Ban
South Africa’s Fair Trade Independent Tobacco Association (FITA) announced on April 30 that it will still seek legal action to reverse the government’s decision to ban tobacco and vapor product sales despite the fact that sales were scheduled to resume May 1.
The government’s National Coronavirus Command Council, following expert consultation and public criticism, believed that keeping cigarettes, vapor products and other tobacco products off retail shelves would not be in the public interest.
According to South African Revenue Services, the sales ban that began March 26 following the initial country lockdown has led to cigarette excise tax losses of ZAR300 million ($16 million).
British American Tobacco (BAT) has sued Philip Morris International (PMI) in the United States and Germany for patent infringement, reports Reuters.
The lawsuits focus on the heating blade technology used in PMI’s IQOS heat-not-burn device, which BAT claims is an earlier version of the technology currently being used in its Glo tobacco heating devices.
BAT filed two patent infringement claims in the United States against Philip Morris, one through the International Trade Commission (ITC) and one in the Virginia federal court, seeking remedies for damages caused and an injunction on importing the product.
“If we win we may be able to get an ITC exclusion order blocking the importation of IQOS into the U.S. by Philip Morris unless they agree to take a license to our patents,” BAT spokesman Will Hill told Reuters.
PMI, which started selling IQOS in the United States last year, vowed it would vigorously defend itself against the legal actions.
The U.S. Federal Trade Commission (FTC) has filed a complaint to force Altria to sell its stake in Juul Labs.
The FTC complaint alleges that Altria and Juul Labs entered a series of agreements, including Altria’s acquisition of a 35 percent stake in Juul Labs, that eliminated competition in violation of federal antitrust laws.
“For several years, Altria and Juul were competitors in the market for closed-system e-cigarettes. By the end of 2018, Altria orchestrated its exit from the e-cigarette market and became Juul’s largest investor,” said Ian Conner, director of the Bureau of Competition. “Altria and Juul turned from competitors to collaborators by eliminating competition and sharing in Juul’s profits.”
A few weeks before announcing its $12.8 billion investment in Juul Labs, Altria announced that it would be taking its MarkTen e-cigarette brand off the market, a brand that had been the second most popular on the market.
Along with the monetary investment in Juul, the companies’ agreement states that Altria will not compete with Juul for six years, according to the FTC.
Altria rejected the complaint. “We believe that our investment in Juul does not harm competition and that the FTC misunderstood the facts,” said Murray Garnick, Altria’s executive vice president and general counsel. “We are disappointed with the FTC’s decision, believe we have a strong defense and will vigorously defend our investment.”
Altria’s investment in Juul Labs has now decreased to $4.2 billion after a series of write-downs following a collection of lawsuits against Juul Labs regarding youth usage.
The U.S. Securities and Exchange Commission (SEC) is investigating whether Altria adequately disclosed the risks of its investment in Juul Labs to shareholders.
Altria spent $12.8 billion on a 35 percent stake in Juul Labs in December 2018, and Altria has recorded $8.6 billion in impairment charges since then, bringing its investment value to $4.2 billion.
The SEC issued subpoenas to Juul Labs, and the company has turned over correspondence documents as well as financial projections that were shared with Altria before the deal.
Massachusetts Attorney General Maura Healey is suing Juul Labs for “creating a youth vaping epidemic,” citing predatory marketing and advertising campaigns.
Filed Wednesday in Suffolk Superior Court, the suit demands that Juul pay for the costs associated with combating the public health crisis affecting young people across Massachusetts.
According to the lawsuit, Juul intentionally chose fashionable models and images that appeal to young people for its ads.
The lawsuit also alleges the company knowingly collected email addresses associated with users who were not age verified for its marketing list and illegally sold and shipped products to underage customers.
Juul has denied that it has ever marketed to young people and said no one underage should use its nicotine vapor products.
“While we have not yet reviewed the complaint, we remain focused on resetting the vapor category in the U.S. and earning the trust of society by working cooperatively with attorneys general, regulators, public health officials, and other stakeholders to combat underage use and transition adult smokers from combustible cigarettes,” Juul said in a statement.
British American Tobacco and Philip Morris International have until early March to defend themselves in a lawsuit in Brazil about compensation for tobacco-related diseases, reports Reuters.
The lawsuit was filed by the solicitor general’s office in May 2019, seeking to recover the costs for the treatment of 26 tobacco-related diseases over the previous five years.
The companies have refused to receive subpoenas delivered to their local subsidiaries (Souza Cruz Ltda, Philip Morris Brasil Industra e Comercio Ltda and Philip Morris Brasil) since last year. The companies, which produce 90 percent of the cigarettes sold in Brazil, maintained they were only subsidiaries and notifications had to be sent directly to their respective parent companies’ headquarters in Britain and the United States.
The federal judge hearing the case ruled that the companies are operational wings of the parent companies and can relate messages to their respective head offices. The judge gave them 30 days to present their defenses.
“It is very important that international headquarters are also held accountable,” said Adriana Carvalho, the Alliance to Control Smoking’s legal director. “They profit from the business in Brazil and have always exercised power of control over their Brazilian units.”
Philip Morris has been ordered to pay $10.5 million in damages to a former marine who lost his voice box to cancer from smoking cigarettes.
After deliberating for four days following a two-week trial, a Florida jury found that Philip Morris had misrepresented and obscured the health impacts and addictive nature of its cigarettes.
Plaintiff Edward Principe alleged that Philip Morris sold cigarettes containing a design defect and had hidden the truth about those cigarettes. Thus, he claimed the company was responsible for his laryngeal cancer.
The jury found that the cigarettes were not defective but that Philip Morris made statements misrepresenting cigarettes’ health impacts and addictive nature as well as statements hiding the facts. The company also made an agreement with other tobacco companies to make fraudulent statements, according to the jury.
