Author: Timothy Donahue

  • RICO-Based Hemp Case Headed for Supreme Court

    RICO-Based Hemp Case Headed for Supreme Court

    Credit: Adobe Stock

    For the first time since the 2018 Farm Bill became law, the Supreme Court of the United States will decide a case about hemp. The lawsuit, Medical Marijuana, Inc., et al. v. Douglas J. Horn, involves the Racketeer Influenced and Corrupt Organizations Act (RICO) and asks whether product manufacturers can be held responsible for a person’s lost earnings and other job benefits under that powerful statute.

    The plaintiff is a commercial truck driver who was fired for failing a random drug test after taking a CBD product that was marketed as THC-free. The plaintiff then filed a RICO claim and state law claims against the companies that marketed the CBD product. He asserted that his lost job earnings and benefits are “business or property” damages that are recoverable under RICO.

    The federal district court dismissed the plaintiff’s RICO claim, finding for the companies that RICO does not provide for personal injury losses. However, the Second Circuit Court of Appeals reversed the district court and reinstated the RICO claim. The Supreme Court agreed to take up the case. If the Supreme Court affirms the Second Circuit’s ruling, the plaintiff could recover up to three times his lost earnings, plus attorney’s fees.

    The U.S. Hemp Roundtable has filed a “friend of the court” brief supporting the defendants’ position that Congress did not intend RICO to apply to personal injury losses. As the brief argues, expanding RICO has major implications for the hemp products industry.

    Industry experts have stated that increased costs will be passed on to consumers, potentially making products unavailable to people who need them. Additionally, more liability may cause manufacturers, distributors, or retailers to exit the industry entirely, which will reduce economic opportunities for hemp farmers and businesses.

    The case is expected to be heard during the court’s next session, which begins in October.

  • Iowa City Seeking to Limit Tobacco, Vape Shops

    Iowa City Seeking to Limit Tobacco, Vape Shops

    Credit: Argus

    Iowa City Council is working to change some of the rules regarding the amount of tobacco and vape stores in town.

    In a work session on Tuesday, councilmembers discussed a 55 permit limit in the city (down from 62), a 500 ft. barrier from tobacco shops being near school or university property, and the ban of the sale of kratom, an herbal substance the gives stimulus effects, according to media reports.

    This is in addition to the moratorium on new tobacco permits that’s in place until December.

    Up in Smoke is among the tobacco and vape shops that sell kratom. While the owner is happy there won’t be as much competition in town, he said it is concerning that the city is looking to ban kratom, as the shop is already dealing with the aftermath of the new state law limiting THC in products.

  • Costa Rica Bans Vaping in Public Places

    Costa Rica Bans Vaping in Public Places

    Credit: Adobe Stock

    Costa Rica has banned vaping in public places such restaurants, offices and educational institutions, reports The Tico Times.

    The move follows a dramatic increase in vaping-related disorders. In 2023 alone, the Costa Rican Social Security Fund recorded 14 cases of vaping-related intoxication, including nine minors, with seven requiring hospitalization.

    Vaping has become increasingly popular among young people in recent years. Gabriela Rojas of the Institute on Alcoholism and Drug Dependence (IAFA) warned that electronic cigarettes contain harmful chemicals.

    “The tobacco industry has cleverly marketed these products, using technology, attractive colors, and various flavors to target underage individuals,” said Zeanne Gonzalez, another IAFA official.

  • Finnish Youth Drop Smoking, E-Cigarette Use Rising

    Finnish Youth Drop Smoking, E-Cigarette Use Rising

    Image: sezerozger

    Finnish teens are drinking and smoking less but using more e-cigarettes and nicotine pouches, reports the Helsinki Times, citing findings from a European survey

    The European School Survey Project on Alcohol and Other Drugs (ESPAD) has been monitoring substance use among European students since 1995.

    Conducted every four years, the survey includes 16-year-olds across 23 to 39 European countries.

    The proportion of ninth graders who have never consumed alcohol has increased dramatically from 10 percent in 1995 to 35 percent in 2024.

    Only 6 percent of boys and 4 percent of girls smoked daily in 2024, down from around 20 percent at the beginning of the decade. However, vaping has been rising, with 40 percent of teens having tried e-cigarettes, up from 34 percent in 2019. Daily use is reported by 9 percent of boys and 13 percent of girls.

    The use of snus, a form of smokeless tobacco, has also dropped. In 2024, 26 percent of boys and 13 percent of girls had tried snus, with daily use at 7 percent for boys and 3 percent for girls.

    Teen use of nicotine pouches increased after Finland permitted the sale of modern oral products in 2023. By 2024, 31 percent of boys and 17 percent of girls had tried nicotine pouches, with 11 percent of boys and 3 percent of girls using them daily.

    Cannabis experimentation decreased slightly during the period studied, particularly among boys, with 11 percent of boys and 9 percent of girls having tried it in 2024.

    The full ESPAD report will be published in 2025.

  • States 2.0 Act may Clarify State, Federal Pot Rules

    States 2.0 Act may Clarify State, Federal Pot Rules

    VV Archive Photo

    In light of the widespread nullification of federal marijuana prohibition, the rising public support for legalization, and the potential excise revenues, policymakers are compelled to seriously consider significant reforms to federal marijuana policy. Last December, members of Congress introduced the STATES 2.0 Act, which would remove marijuana from the Controlled Substances Act, federally legalize its sale and use, and allow for interstate commerce.

    A defederalized marijuana prohibition policy would allow states to decide for themselves whether cannabis would be legal within their borders—which they have already been doing for decades—and how that legal cannabis market would be taxed, writes the Tax Foundation.

    What legal markets already exist are burdened by federal prohibition and punitive taxation, which keeps prices substantially higher than illicit markets. Bolstering black markets is a common unintended consequence of prohibition, and marijuana has been no different—even with existing state legalization. Revisions to federal cannabis policies, such as those in the STATES 2.0 Act, would give much-needed reform to a market struggling with a messy policy landscape.

    Regulating Cannabis Markets

    Instead of enforcing marijuana prohibition through the Drug Enforcement Administration, the STATES 2.0 ACT would rely on the Food and Drug Administration to regulate marijuana products permissible in US markets and the Alcohol and Tobacco Tax and Trade Bureau (TTB) to track products and collect taxes. Federal and state law enforcement would be able to shift focus and budgets away from petty offenses for marijuana possession toward removing more dangerous substances from illicit markets and preventing violent and property crimes.

    The recent failings of the FDA to properly facilitate a legal vaping market may call into question its ability to do the same for cannabis, and there are more efficient ways to ensure product safety. However, the STATES 2.0 Act specifies that no premarket approval would be required, which would preclude the type of disaster inflicted on the vaping market.

    Allowing legitimate businesses to manufacture and sell cannabis products, as well as allowing banks to do business with a legal cannabis industry, would do much to enable a safe, legal market to undercut the existing black markets dominated by cartels.

    The STATES 2.0 Act would allow interstate commerce in cannabis and cannabis products when traveling between states that have provided for legalized cannabis within their borders, even if passing through states that have chosen to keep marijuana illegal.

    TTB would be responsible for administering a national track-and-trace system. Similar track-and-trace systems are already in place within states that have legalized recreational marijuana, allowing states to track marijuana plants from seed to consumer sale.

    A federal system administered by TTB could incorporate existing state systems into a national database. TTB would also enforce consistent and timely tax collections.

  • Nicotine Pouch Sales Rising at Haypp Group

    Nicotine Pouch Sales Rising at Haypp Group

    Photo: Haypp Group

    The Haypp Group, the world’s largest online retailer of nicotine pouches, reported net sales of SEK942.8 million ($89.66 million) for the second quarter of 2024, up 23 percent over the comparable 2023 period.

    Gross profit increased to SEK135.2 million, corresponding to a gross margin of 14.3 percent. Adjusted earnings before interest and taxes rose to SEK34.4 million, mainly due to the higher gross margin, increased volume as well as efficiency gains, partially offset by continued investments into additional capabilities.

    The company’s nicotine pouch volume grew by 43 percent over the second quarter of 2023.

    “Haypp group continued to show a very strong performance in the second quarter with YoY Nicotine Pouch volume growth of 43 percent,” said Haypp Group CEO Gavin O’Dowd in a statement.

    “This is accelerating from prior quarters as the category continues to thrive in our growth markets due to the increasing appetite for risk reduced products. While the category experienced some turbulence in the USA during the quarter, we were well positioned and our volume grew around 70 percent. The investments in our business operations have continued to deliver value with an increase of 68 percent in our adjusted EBIT. This robust growth, over many years shows how robust our business is, irrespective of the economic environment.”

    The Haypp Group’s interim report is available here.

  • ‘Medical Vapes Facing Uphill Battle’ for Approval

    ‘Medical Vapes Facing Uphill Battle’ for Approval

    Photo: DALU11

    Companies developing vape-like devices to ease medical conditions such as migraines and respiratory diseases continue to face skepticism from health authorities and the public, according to a Reuters article.

    The piece details the efforts of Qnovia, MIIST Therapeutics and Greentank, which are exploring the potential of nebulizer technology or heating technology to deliver medications.

    The companies say inhalation can relieve pain faster and with fewer side effects than pills. Federico Buonocore, a professor focused on alternative pulmonary drug delivery at Kingston University in Britain, told Reuters that existing inhaled drug delivery devices are clunky and difficult to operate, and so tend to be used wrongly. A vape-like design could solve such challenges, he was quoted as saying.

    Qnovia plans to submit drug applications in the U.S. soon and the United Kingdom in 2026 for its device as a nicotine replacement therapy, and launch a clinical trial in September.

    Greentank is looking for a pharmaceutical partner to support the development of its heating chip for medicine delivery.

    Efforts by traditional tobacco companies to tap into the pharmaceutical market have been hampered by mistrust and opposition from health officials.

    Philip Morris International last year scrapped a goal to earn over $1 billion in annual revenue by 2025 from its wellness and healthcare unit, which includes a business making asthma inhalers.

    CEO Jacek Olczak said the company had been “too optimistic about how the external environment will accept… Big Tobacco” in industries outside of nicotine. An inhaled aspirin product developed by the unit was also deemed unsuccessful after a clinical trial last year.

    Tobacco-backed companies developing Covid-19 vaccines using plant-based technology also faced stiff opposition from health groups, including the World Health Organization.

    Buonocore said the stigma associated with tobacco and vaping companies would be difficult for the sector to overcome.

  • Taiwan Mulls Ban on 27 Kinds of Flavor Chemicals

    Taiwan Mulls Ban on 27 Kinds of Flavor Chemicals

    Photo: Hertz Flavors

    The Ministry of Health and Welfare wants to ban 27 types of chemicals from being used in tobacco products, vapes and heat-not-burn devices, reports The Taipei Times.

    The list includes vanillin, maltol and heliotropin among other chemical compounds commonly used as additives in flavored tobacco products. Without these substances, manufacturers would be unable to produce popular flavors such as caramel, butter, almond, rose, coconut, raspberry, vanilla and cheese,

    The new proposal would enable the ministry to remove more than half of flavored tobacco products from the market, according  to Lo Su-ying, who heads the Health Promotion Agency’s Tobacco Control Division.

    Under the draft rule, manufacturers and importers of products containing the banned substances would risk fines of between NTD1 million ($30,846) and NTD5 million, while sellers would incur penalties of between NTD10,000 and NTD50,000.

     The government will subject the proposal to a 60-day public consultation.

  • Activist Decry New Zealand’s Disposables Ban

    Activist Decry New Zealand’s Disposables Ban

    Photo: YarikL

    Vaping activists have expressed concern about New Zealand’s decision to ban disposable e-cigarettes.

    The New Zealand Ministry of Health announced the ban with the intention of reducing adolescent vaping. The new regulations prohibit the manufacture and sale of all non-rechargeable and non-refillable vapes, including single-use containers such as pre-filled tanks, pods and cartridges.

    The World Vapers Alliance (WVA) warned that the ban could undermine New Zealand’s progress in reducing smoking rates.

    “Preventing teenagers from using nicotine products is essential, and strict age regulations should be enforced to achieve this goal,” said WVA Policy Manager Alberto Gómez Hernández in a statement.

    “However, banning disposable vapes and various pod systems for adult consumers will have negative public health implications and jeopardize the progress towards a smoke-free society achieved in the last decade. This approach fails to recognize the vital role disposable vaping products play in helping smokers transition away from cigarettes.”

    The Coalition of Asia Pacific Tobacco Harm Reduction Advocates (CAPHRA) expressed similar reservations. “We understand and support the government’s intent to curb youth vaping,” said CAPHRA Executive Coordinator Nancy Loucas.

    “However, the proposed ban on disposable vaping products, including prefilled tanks, pods and cartridges, will create substantial barriers for adults who smoke and older vapers. Many of these individuals rely on simpler, disposable products due to difficulties with dexterity and the complexities of refillable devices. This ban could force them back to smoking cigarettes, which is counterproductive to the Smokefree 2025 goal.”

  • Two Arrested in UAE for Selling Illegal Vapes

    Two Arrested in UAE for Selling Illegal Vapes

    Credit: Creative

    Police in the United Arab Emirates city of Ajman arrested two persons of interest on charges of trading and storing 797,000 e-cigarettes without a license and tax evasion.

    Upon receiving a report, the authorities immediately formed a team and raided the site, where large quantities of e-cigarettes from several companies were seized.

    As many as 797,555 electronic cigarettes were found stored in five rooms in the villa, bearing the trademarks of hundreds of electronic cigarette manufacturing companies, according to media reports.

    The authority called on the public to be careful when purchasing goods from non-approved sales locations and not to hesitate to report them, pointing out the dangers of smoking to health and safety.

    It also added that Ajman Police will be on the lookout and will deal firmly with tax evasion crimes that tamper with national security and safety of citizens and residents.