Author: Timothy Donahue

  • Louisiana Ends Sales of Unauthorized E-cigarettes

    Louisiana Ends Sales of Unauthorized E-cigarettes

    Today is the day that any vaping product not authorized by the U.S. Food and Drug Administration must be removed from store shelves in Louisiana as the state’s new vaping law goes into effect.

    Act 414 also increased taxes on vaping products, which began on Oct. 1. Beginning today, only FDA-approved vapes and alternative nicotine products registered with Louisiana Alcohol and Tobacco Control (ATC) will be allowed to be sold in the state.

    For the products to be considered by the ATC, a $100 application fee per product is required as well as authorization by the FDA. A list of those approved products will be released today. It is expected to be a short list.

    To date, the FDA has only authorized 23 tobacco-flavored e-cigarette products and devices, which are the only e-cigarettes that currently may be lawfully sold or distributed in the U.S. Many of those products are outdated and all are owned by major tobacco companies.

  • Quebec: Vaping Flavor Ban Goes Into Effect Today

    Quebec: Vaping Flavor Ban Goes Into Effect Today

    Credit: CL-Medien

    Vapers of scared about possibly having to return to combustible cigarettes in Quebec as the Canadian city’s flavor ban for vaping products takes effect today, Oct. 31.

    Quebec’s ban includes vaping products with flavors other than tobacco and will prohibit e-liquid sold in bottles with a capacity greater than 30 mL and prefilled devices with a capacity greater than 2 mL.

    The flavor ban was announced in a draft published in April. More than 30,000 citizens of Quebec commented on the proposed ban, according to the Quebec Vaping Rights Coalition, but the health ministry reportedly didn’t make any changes to the rules in response.   

    Quebec is the largest province in Canada to enact a flavor ban. Four other provinces and territories have flavor bans in place, and one has passed a ban but has not set an effective date yet. Three other provinces restrict flavored products to adult-only stores.

    The Canadian Vaping Association (CVA) has expressed concerns to the Quebec government, arguing that this regulation will not achieve its intended goal of curbing youth experimentation.

    According to the CVA, the consequences will include the closure of specialty vape shops within the province, the loss of over 1000 jobs, and a shift in consumer demand towards foreign suppliers and the illicit market.

    “It’s high time for provinces like Quebec, New Brunswick, Nova Scotia, and PEI to re-evaluate their stance and stop yielding to the influence of big tobacco companies. These regions must come to the realization that they are inadvertently supporting the very issues they claim to be combating,” said Darryl Tempest, government relations counsel to the CVA.

    The available data consistently finds that flavor bans fail to effectively protect youth and lead to increased tobacco sales among both young people and adults.

  • BAT Germany Selects Arvato as Vape Logistics Provider

    BAT Germany Selects Arvato as Vape Logistics Provider

    Credit: Timon

    BAT Germany has selected Arvato as its logistics and fulfillment partner for its e-commerce operations encompassing e-cigarettes and heated tobacco products.

    Since the end of June, BAT Germany online orders have been processed centrally from the site in Marienfeld, Guetersloh district. At this site, Arvato, a leading supply chain and e-commerce service provider, operates a state-of-the-art distribution center spanning approximately 32,000 square meters, serving multiple clients in the technology sector, according to the American Journal of Transportation (AJOT).

    The comprehensive logistics services provided for BAT Germany at the facility encompass goods receipt, storage, order picking, packing, and shipping, as well as returns management.

    “BAT’s goal in awarding the e-commerce logistics contract was to guarantee the most efficient and fastest delivery service for its customers. Our customer-centric approach allowed us to accommodate BAT’s specific processes and requirements,” says Thomas Becker, executive vice president at Arvato.

    The logistics service provider commits to delivering within a 48-hour timeframe. To optimize warehouse operations for efficiency and speed, Arvato heavily integrates automation technology. Automated carton setup and closure processes significantly enhance the speed of operation. Moreover, product information is automatically included with orders through flyer dispensers.

    “With its experienced team, Arvato provided us with very flexible and reliable support in setting up our logistics and distribution concept,” confirms Robert Juhnke, distribution manager at BAT Germany. “Even throughout the offer and final negotiation phase, the collaboration has been exceptionally cooperative.”

    Sustainability is a growing trend in the vaping industry. Arvato is dedicated to doing its part, according to the AJOT story. In an effort to reduce plastic waste, the company adopted wet adhesive tape made from recycled paper, resulting in the annual saving of approximately 16 tons of plastic, as an alternative to polypropylene adhesive tape. Arvato’s approach to optimizing shipment sizing and processing minimizes the consumption of packaging materials.

  • Disposing of Disposable Vapes a Problem for Cities

    Disposing of Disposable Vapes a Problem for Cities

    vape trash disposable garbage waste
    Credit: Benny Robo

    The nationwide use of disposable e-cigarettes is creating a new challenge for local governments trying to figure out how to dispose of them properly. One of the main issues is that the millions of tiny, battery-powered products consumers toss in the trash every year are classified as hazardous waste.

    The devices, which contain nicotine, lithium and other metals, cannot be reused or recycled. Under federal environmental law, they shouldn’t go in the trash.

    “We are in a really weird regulatory place where there is no legal place to put these and yet we know, every year, tens of millions of disposables are thrown in the trash,” said Yogi Hale Hendlin, a health and environmental researcher at the University of California, San Francisco, told the Associated Press.

    Cost concerns

    In late August, sanitation workers in Monroe County, New York, packed more than 5,500 brightly colored e-cigarettes into 55-gallon steel drums for transport. Their destination? A giant, industrial waste incinerator in northern Arkansas, where they would be melted down.

    Sending 350 pounds of vapes across the country to be burned into ash may not sound environmentally friendly. But local officials say it’s the only way to keep the nicotine-filled devices out of sewers, waterways and landfills, where their lithium batteries can catch fire.

    “These are very insidious devices,” said Michael Garland, who directs the county’s environmental services. “They’re a fire risk and they’re certainly an environmental contaminant if not managed properly.”

    Elsewhere, the disposal process has become both costly and complicated. In New York City, for example, officials are seizing hundreds of thousands of banned vapes from local stores and spending more than $1 each for disposal.

    Hazardous waste

    Vaping critics say the industry has skirted responsibility for the environmental impact of its products, while federal regulators have failed to force changes that could make vaping components easier to recycle or less wasteful.

    Among the possible changes: standards requiring that e-cigarettes be reusable or forcing manufacturers to fund collection and recycling programs. New York, California and several other states have so-called extended product responsibility laws for computers and other electronics. But those laws don’t cover vaping products and there are no comparable federal requirements for any industry.

    Environmental Protection Agency rules for hazardous waste don’t apply to households, meaning it’s legal for Americans to throw e-cigarettes in the garbage at home. But most businesses, schools and government facilities are subject to EPA standards in how they handle harmful chemicals like nicotine, which the EPA considers an “acute hazardous waste,” because it can be poisonous at high levels.

    The lithium in e-cigarette batteries is the same highly sought metal used to power electric vehicles and cellphones. But the quantities used in vaping devices are too small to warrant salvage. And nearly all disposable e-cigarette batteries are soldered into the device, making it impractical to separate them for recycling.

    Disposable e-cigarettes currently account for about 53 percent of the multi-billion U.S. vaping market, according to U.S. government figures, more than doubling since 2020.

    In recent months the FDA has begun trying to block imports of several leading disposable brands, including Elf Bar and Esco Bar. Regulators consider them illegal, but they have been unable to stop their entry to the U.S. and the devices are now ubiquitous in convenience stores, gas stations and other shops.

    FDA’s tobacco chief, Brian King, said in a statement that his agency “will continue to carefully consider the potential environmental impacts” of vaping products.

    Money matters

    Since last November, officials have seized more than 449,000 vape units, according to New York City figures. The city is spending about $1,400 to destroy each container of 1,200 confiscated vapes, but many more remain in city storage lockers.

    “I don’t think anyone ever considered the volume of these in our community,” said New York Sheriff Anthony Miranda, who leads a task force on the issue. “There’s a tremendous amount of resources going into this effort.”

    A recent lawsuit against four large vaping distributors aims to recoup some of the city’s costs.

    For now, New Yorkers who vape can bring their used e-cigarettes to city-sponsored waste-collection events.

    Ultimately those vapes meet a familiar fate: They are shipped to Gum Springs, Arkansas, to be incinerated by Veolia, an international waste management firm. The company has incinerated more than 1.6 million pounds of vaping waste in recent years, mostly unsold inventory or discontinued products.

    Veolia executives say burning e-cigarettes’ lithium batteries can damage their incinerators.

    Boulder finish

    “Ideally we don’t want to incinerate them because it has to be done very, very slowly. But if have to, we will,” said Bob Cappadona, who leads the company’s environmental services division.

    Veolia also handles e-cigarettes from Boulder County, Colorado, one of the only U.S. jurisdictions that actively tries to recycle e-cigarette batteries and components.

    Beginning in 2019, county officials began distributing bins to schools for confiscated or discarded e-cigarettes. Last year, they collected 3,500.

    County staffers sort the devices by type, separating those with removable batteries for recycling. Disposables are packed and shipped to Veolia’s incinerator. Shelly Fuller, who directs the program, says managing vape waste has gotten more costly and labor intensive with the shift to disposables.

    “I kind of miss the days when we had Juuls and I could take each battery out and recycle them very easily,” Fuller said. “No one has time to dismantle a thousand Esco Bars.”

  • Vape Companies in Legal Brouhaha Over Endorsements

    Vape Companies in Legal Brouhaha Over Endorsements

    law lawyer trail scales of justice
    Credit: Kritdanai

    The two South Florida Vape product companies are engaged in a bitter legal brouhaha over celebrity endorsements with millions of dollars at stake. Alejandro Brito, the attorney representing HQDTech USA LLC and Dummy Vapes LLC as plaintiff’s in a lawsuit against Broward County-based, SYB Entertainments Group LLC, QR Joy Inc. and QR Joy Fume LLC., claims that the rapper Tekashi 6ix9ine, whose birth name is Daniel Hernandez, entered into an exclusive contract with the plaintiff to endorse their vaping products. Brito called the endorsement contract with the famous rapper their “lightning in a bottle.”

    “I’ve seen the numbers and this particular individual moves the market and was compensated very handsomely as a result of this exclusive relationship between my client and him, and the other competitors took notice,” said Alejandro Brito, attorney for HQDTech USA LLC and Dummy Vapes LLC as plaintiff’s in a lawsuit against Broward County-based, SYB Entertainments Group LLC, QR Joy Inc. and QR Joy Fume LLC.

    The fighting began when SYB allegedly learned that Hernandez had entered an exclusive contract with the plaintiff, HQD, to endorse their vaping products. According to Brito, the other competitors (SYB) tried to get Hernandez to endorse their vaping products instead. They even allegedly offered Hernandez $1 million to sign with SYB, which Hernandez declined.

    However, SYB then later signed a $250,000 agreement with Hernandez’s girlfriend Yailin la Más Viral who has 11 million Instagram followers. The complaint further alleges that these actions were taken by SYB to use la Más Viral’s relationship with Hernandez to take advantage of Hernandez’s and the plaintiff’s vaping product’s growing popularity.

    Joshua Kon, an attorney for Stok, Kon and Braverman, which is defending Fume in the lawsuit, called the case “lukewarm,” adding that HQDTech and Dummy Vapes are attempting to illegally use and take advantage of the popularity of Fume vaping products.

    “HQDTech, Dummy Vapes and its principals perpetrated an elaborate fraud on Daniel Hernandez, aka Tekashi 6ix9ine, as well as the vape consumer marketplace,” Kon said. “HQD and Dummy Vapes lied to everyone and encroached on the ‘Fume’ brand’s commanding market share, flouting Federal and Florida laws in the process.

    “As a consequence, QR Joy, QR Fume and SYB Entertainment Group intend to immediately file a motion to dismiss and a substantial counterclaim to rectify these wrongdoings and hold HQD and Dummy Vapes accountable for their unlawful profiteering.”

    Motion for injunction

    The plaintiff’s attorney immediately filed an emergency motion for temporary and preliminary injunction. “[This was] to stop the defendants from continuing to harm the plaintiffs’ business, which has been scheduled for hearing on Nov. 16, 2023,” Brito said.

    The complaint also alleges the SYB was behind a letter attempting to gain confidential documents from the plaintiffs, according to a story on law.com.

    “Rather than just play it straight and wait for the contract to expire or negotiate with our clients for a buyout, [Fume] had gone the route of trying to be deceptive in forming a new company, claiming that company to be a management company for Mr. Hernandez, and asking us to produce our agreements with Mr. Hernandez under the guise of this new entity. That’s really deceptive,” Brito said.

    Risks that ‘go far beyond’

    At the start of this year, John Uustal, a lawyer based in Fort Lauderdale and the founding partner of Kelley|Uustal, represented rapper Flo Rida in a lawsuit against Celsius Inc., the company behind the well-known energy drink. The jury ultimately awarded Flo Rida an $82.6 million dollar judgment in compensation for breach of contract.

    While not a part of the Fume lawsuit, Uustal said cases involving celebrity endorsements are “almost always insanely complicated, because there is so much more going on” than just the legal issues.

    “Sometimes celebrities get taken advantage of because it’s not worth it for them to enforce their rights legally,” Uustal said. “And when they do, there are real risks that go far beyond the litigation because the litigation affects reputation.

    “In a case like this, where the celebrity is not actually a litigant, the parties must still consider the ramifications of the litigation on the relationship with the celebrity.”

    Uustal said this dispute does not currently have a realistic and accurate way to value the injury to HQD if the company wins on liability.

    “In a case I recently went to trial on, the measure of damages was 750,000 shares of stock, which is what the contract called for if certain benchmarks were met,” Uustal said. “That’s a lot simpler than measuring how the alleged conduct affected a business,” referring to the Flo Rida win.

    In the HQD v. Fume vaping case, Brito—who also represents former President Donald Trump in his South Florida lawsuit against his former attorney Michael Cohen for attorney-client privilege violations—says his vape company clients are looking for substantial damages, “which has been caused and will continue to be caused by virtue of the usurpation of sales, as well as confusion in the marketplace.”

  • Altria: Illicit Disposable Vapes Impacting NJOY Sales

    Altria: Illicit Disposable Vapes Impacting NJOY Sales

    Credit: Apichat

    Altria says a booming illegal disposable flavored vape market is causing a major decline in the sales of its authorized vaping products.

    Sal Mancuso, Altria’s CFO, pointed out on a call with select media and financial analysts that traditional cigarette industry volumes had dropped even more than usual in the third quarter. The decline was caused by inflation and economic issues influencing customers, as well as the heightened usage of illegal flavored disposable e-cigarettes.

    Mancuso further stated that there appeared to be more switching between different categories than initially assumed and that e-cigarettes alone were causing a 1.5 percent to 2.5 percent reduction in traditional cigarette industry volumes.

    BAT subsidiary R.J. Reynolds Vapor Co. holds the top market share in the U.S. at 41.8 percent as of the latest Nielsen convenience store report released Oct. 7.

    NJOY, which Altria purchased for $2.75 billion in June, has struggled to increase its No. 3 market share.

    “The current state of the (vaping) market is intolerable for both legitimate manufacturers and consumers,” Billy Gifford, Altria’s CEO, said during the call. “As we have noted repeatedly for months, the regulated market is being overrun by illegal-flavored disposable e-vapor products made and distributed by companies violating virtually every rule and guidance FDA has issued since 2016.

    “A lot of these products are imported. They’re imported illegally and then they’re sold illegally.”

    Saying a “strong course correction is needed,” Gifford noted that Altria has filed federal lawsuits in California against 34 organizations that include manufacturers, distributors and online retailers.

  • Guam Leaders Propose Excise Tax Rules for Vapes

    Guam Leaders Propose Excise Tax Rules for Vapes

    Credit: Sezerozger

    Lawmakers in Guam are proposing to impose a 10 percent excise tax on all vape products for the first year, and then raising it to 20 percent on the second year.

    Guam currently has no standardized tax regulations for what the bill describes as electronic nicotine-delivery systems (ENDS).

    The bill, if enacted into law, will make the taxation for vape products separate from the existing tobacco retail category.

    They do not include regulated cannabis products, according to Pacific News Daily.

    Sen. Joe San Agustin and three other Democrat and Republican senators proposed the new rules. San Agustin, chairman of the appropriations committee, said the proposed tax on ENDS products came after realizing the loss of millions in revenues in the Healthy Futures Fund where it showed major shortfalls in revenues from tobacco taxes.

    Under Bill 193-37, or the ENDS Excise Tax of 2023, the tax will be imposed on all ENDS products at the point of sale and will be made visible as a line item on the receipt.

    Under the bill, the annual retail license will be $200, and the annual wholesaler license will be $2,000.

  • Deadline is Nov. 1 for Louisiana Vape Product Registration

    Deadline is Nov. 1 for Louisiana Vape Product Registration

    Credit: VFHNB12

    A strict new vape law goes into effect on Nov. 1 in Louisiana. It will require every vapor product manufacturer to register their products with the Louisiana Alcohol and Tobacco Commission (ATC).

    Store owners say the impact could be devastating for sales since fewer vape products will occupy shelf space as products not approved by the ATC can not be legally sold in the state.

    “Every store will take about a 30, 40 percent hit. It will impact us not only through sales but also through payroll, keeping up with our expenses, different things like that will definitely affect business in a worse way than we could imagine,” Lit Vape and Smoke Owner Bilal Wardariya told KPLCTV.

    The legislation stemmed from a bill to increase the vape tax, which tripled this year, but Wardariya said limiting the usage of vapes is taking it too far.

    “I think this vape ban negatively impacts the state in many different ways, not just people, but the state itself because we give so much tax revenue. As a whole, I’d like to see this thing get resolved and hopefully, we can still sell and keep the same process we’ve been having for many many years,” he said.

    Other vape shops in the area agree that it will affect business but believe the state and customers will suffer as well.

    “We pay thousands of dollars in taxes between all of our stores, so they’re going to lose that, and it affects our customers because a lot of them genuinely need this to stop smoking cigarettes and stuff,” Smoke 360 Manager Joshua Snyder said.

    For the products to be considered by the ATC, a $100 application fee per product is required as well as approval by the FDA. A list of those approved will be released on Nov. 1.

    To date, the FDA has authorized 23 tobacco-flavored e-cigarette products and devices, which are the only e-cigarettes that currently may be lawfully sold or distributed in the U.S. Many of those products are outdated and all are owned by major tobacco companies.

  • Snowplus to Launch 2 New Disposables at Vaper Expo UK

    Snowplus to Launch 2 New Disposables at Vaper Expo UK

    Snowplus will soon launch two all-new disposable e-cigarettes. The Snowplus Gold Bar and Snowplus Clic are the first 5,000 puffs TPD-compliant devices to come to market, according to an emailed press release.

    Debuting at the Vaper Expo UK, to be held from October 27-29 in Birmingham, England, the new products represent a “pioneering innovation” in the vaping market, according to Snowplus.

    “The Snowplus Gold Bar will be the game-changer in the industry, it will definitely lead the product development direction,” said a Snowplus spokesperson. “A 5,000-puff TPD disposable vape has never been seen in the UK market before.”

    All vaping products sold in the UK must comply with the EU Tobacco Products Directive (TPD). Most legal disposable vaping products in the UK deliver less than 800 puffs in order to meet TPD requirements.

    The Gold Bar and Clic models both feature transparent e-liquid tanks that give users a clear, real-time view of remaining juice levels. The products also utilize lab-tested mesh coils made of specialized materials to deliver consistent and authentic flavor across 16 different juice options.

    “Snowplus has pioneered responsible innovation since its founding in 2019,” the release states. “With $40 million in funding from renowned investors like Sequoia Capital, the company aims to provide better alternatives to combustible cigarettes for adult consumers.”

    The Snowplus Gold Bar and Clic have also passed numerous third-party safety tests.

  • Reynold’s Vuse Holds Steady With 41% Market Share

    Reynold’s Vuse Holds Steady With 41% Market Share

    Credit: Jet City Image

    According to the latest Nielsen convenience store report, R.J. Reynolds Vapor Co.’s Vuse still holds a comfortable lead in e-cigarette market share for the four weeks ending Oct. 7.

    The company saw its lead increase slightly from 41.7 percent to 41.8 percent, while Juul’s share decreased from 24.7 percent to 24.4 percent, according to media reports.

    This comes after Juul Labs Inc.’s regulatory concessions earlier this year caused their share to drop from 74.6 percent.

    Meanwhile, Altria Group Inc.’s complete acquisition of NJOY on June 1 has yet to translate into any considerable increase in market share, as the companies only dipped about 0.1 percent from 2.6 percent to 2.5 percent.

    Fontem Ventures’ blu eCigs, an affiliate of Imperial Brands Plc, rose from 1.2 percent to 1.3 percent.

    Reynolds last week filed a U.S. International Trade Commission (ITC) complaint charging multiple manufacturers, distributors, and retailers of several popular disposable vaping devices with unfair importation.

    It is one of several recent actions Reynolds has made to remove its competitor’s vaping products from store shelves.

    Altria Group’s e-cigarette subsidiary NJOY, LLC has filed lawsuits against 34 foreign and domestic manufacturers, distributors and online retailers of illicit disposable vaping products.