Category: Litigation

  • VTA Files Amicus Brief in Triton PMTA Lawsuit

    VTA Files Amicus Brief in Triton PMTA Lawsuit

    Credit: William A. Morgan

    The 5th Circuit Court of Appeals granted the Vapor Technology Association’s (VTA) unopposed motion to file an amicus brief in support of Petitioners’ Petition for a Rehearing En Banc in the case Wages & White Lion Investments, a/k/a/ Triton Distribution v. FDA.

    Recently, a panel of 5th Circuit judges denied Triton Distribution’s appeal of the U.S. Food and Drug Administration’s marketing denial order for its flavored e-liquid products in a 2-1 decision. Thereafter, Triton filed a petition for en banc review, asking the entire 5th Circuit to reconsider the ruling.

    The VTA’s amicus brief supports Triton’s request by explaining that it involves issues of “exceptional importance” necessitating review by the entire 5th Circuit Court of Appeals.

    The VTA’s amicus brief highlights three key points: economist John Dunham and Associates’ evaluation of the adverse economic impact that the ruling would have if it led to the removal of all flavored open system vaping products from the states comprising the 5th Circuit (Louisiana, Mississippi and Texas); the leading tobacco control scientists who have warned that removing flavors will deter adult smokers from quitting and have recommended limiting the sale of flavored vaping products to adult-only stores; and the results of the VTA’s analysis of the FDA’s compliance data between Jan. 1, 2020, and June 30, 2022, which reveal that the rate of illegal youth sales of cigarettes and cigars are twice the rate of vaping products.

  • Court Confirms FDA’s Authority Over Vaping Products

    Court Confirms FDA’s Authority Over Vaping Products

    Photo: Mikhail Reshetnikov

    A U.S. appeals court endorsed the Food and Drug Administration’s  authority over vaping products in a case challenging a marketing denial order (MDO), reports ECigIntelligence.  

    New York-based Prohibition Juice had disputed an MDO, asserting that the agency lacked the statutory authority to consider a product’s “relative effectiveness at promoting cessation of combustible cigarette use versus another product with an otherwise similar health risk profile and labeling.”

    However, the U.S. Court of Appeals for the District of Columbia Circuit ruled that the FDA is entitled under the Tobacco Control Act to determine whether a product is appropriate for the protection of public health, and that meant an applicant must supply all information concerning investigations that have been made on the health risks of a product as well as whether a product presents less risk than others.

  • Juul Settles Teen Vaping Investigation With 33 States

    Juul Settles Teen Vaping Investigation With 33 States

    Photo: steheap

    Juul Labs will pay nearly $440 million to settle a two-year investigation by 33 U.S. states into the marketing of its vaping products, which critics have blamed for sparking a surge in underage vaping, reports AP.

    The probe found that Juul marketed its e-cigarettes to underage teens with launch parties, product giveaways and ads and social media posts using youthful models.

    “Through this settlement, we have secured hundreds of millions of dollars to help reduce nicotine use and forced Juul to accept a series of strict injunctive terms to end youth marketing and crack down on underage sales,” Connecticut Attorney General William Tong said on Sept. 6 in a statement.

    In reality, most of the limits imposed by the settlement won’t affect Juul’s practices, which halted use of parties, giveaways and other promotions after coming under scrutiny several years ago.

    While Juul’s early marketing focused on young, urban consumers, the company has since shifted to pitching its product as an alternative nicotine source for older smokers.

    “We remain focused on our future as we fulfill our mission to transition adult smokers away from cigarettes—the number one cause of preventable death—while combating underage use,” the company said in a statement.

    While resolving one of the biggest legal threats, Juul Labs still faces nine separate lawsuits from other states. Additionally, Juul faces hundreds of personal suits brought on behalf of teenagers and others who say they became addicted to the company’s vaping products.

    The company is also in the process of appealing a marketing denial order (MDO) by the U.S. Food and Drug Administration, which, if upheld, would force its products off the market.

    In June, the FDA rejected Juul Labs’ premarket tobacco product applications, saying that the company has submitted insufficient evidence that its products were appropriate for the protection of public health.

    While the agency subsequently suspended its MDO, citing scientific issues in the application that warrant additional review, the agency stressed that the stay does not rescind the order.

  • Altria Investor Settlement Over Juul Denied by Judge

    Altria Investor Settlement Over Juul Denied by Judge

    Photo: steheap

    A U.S. federal judge declined to give preliminary approval to a proposed $117 million settlement between Altria Group and shareholders in a lawsuit over the company’s investment in Juul Labs, calling the deal “inadequate,” reports Law360.

    The lawsuit contends that Altria’s executives threw caution to the wind when they bought a 35 percent stake in Juul for $12.8 billion in 2018.

    According to the shareholders, the Altria executives also engaged in illegal and anti-competitive conduct that cost Altria billions of dollars as Juul faced an increasing number of legal battles over the alleged health risks of its products and alleged marketing to underage consumers—problems that the plaintiffs say Altria knew about at the time of the investment but ignored.

    The value of Altria’s investment has declined steadily as Juul Labs faced litigation and increased regulatory scrutiny.

    The plaintiffs argued for approval of the settlement, saying the recovery is fair and reasonable when weighed against the costs and risks of further litigation. U.S. District Judge David J. Novak did not explain why he considered the settlement inadequate.

  • Vapor Makers Prevail Over FDA in PMTA Denial Suit

    Vapor Makers Prevail Over FDA in PMTA Denial Suit

    Credit: Tanasin

    A split 11th Circuit on Tuesday told the U.S. Food and Drug Administration it shouldn’t have denied six e-cigarette companies’ premarket tobacco product applications (PTMAs) to sell flavored vaping products without first taking a look at their marketing and sales plans designed to minimize youth exposure and access.

    The U.S. Court of Appeals for the Eleventh Circuit granted petitions for review filed by Bidi Vapor, Diamond Vapor and four other companies challenging the FDA’s rejection of their e-cigarette applications in a 2-1 decision. According to Chief Judge William Pryor, the agency didn’t assess “the companies’ marketing and sales-access-restriction plans designed to minimize youth exposure and access.”

    The court explicitly labeled the FDA’s decision-making as “arbitrary and capricious.” Prior legal decisions have determined that FDA action must consider all relevant factors in order to be legally justifiable. In the case of these vape manufacturers, the court ruled that the FDA had not performed such consideration.

    “These tobacco companies submitted survey information from their customers about smoking cessation, literature reviews, scientific studies about switching to e-cigarettes, smoking cessation, and the role of flavors, and details about its marketing and youth-access-prevention plans,” notes the court in its opinion. “For example, Diamond uses technology for its online sales that relies on public records to verify a purchaser’s age.”

    Vapor industry advocates welcomed the decision. Gregory Conley, director of legislative and external affairs at the American Vapor Manufacturers Association said that while court ruling does not order the FDA to grant PMTAs—and that the agency is likely to deny the applications in the future—the companies involved could end up in the queue for review in 2025, which keeps them in business.

    “Additionally, this leaves the door open for further litigation on these and other PMTAs,” Conley wrote on Twitter. “The FDA’s vague and undefined ‘appropriate for the protection of public health’ standard has long been open for attack. This is just the start.”

    The 11th Circuit decision follows revelations that forced the FDA to admit to not considering all evidence when issuing marketing denial orders (MDOs) to vape products made by Juul and Turning Point Brands. In the interests of public health, future FDA decision-making must engage with all available evidence, not just evidence that leads to their preferred outcomes.

    The court also recognized relevant distinctions between closed/cartridge systems and the e-liquids used in open systems. The court also found that the FDA’s refusal to review marketing plans was “error and not harmless” (disagreeing with Fifth and DC Circuits).

    All petitioners’ appeals were granted, denial orders vacated and remanded.

    In her dissent, Judge Robin Stacie Rosenbaum wrote that anyone who knows all the relevant facts of this lawsuit probably already knows how this case will eventually end.

    “The Majority faults the FDA for not considering the companies’ proposed restrictions on kids’ use. And to be sure, the FDA said that factor would be relevant,” stated Rosenbaum. “But even assuming that the FDA erred when it didn’t consider the Companies’ proposed marketing and access-restriction plans, the FDA’s framework for evaluating pre-market tobacco product applications leaves no room for doubt that the FDA will deny—in fact, under the Family Smoking Prevention and Tobacco Control Act, must deny—the applications on remand. To paraphrase the Borg, then, remand is futile.”

     

  • Judge Boosts Philip Morris’ IQOS Infringement Award

    Judge Boosts Philip Morris’ IQOS Infringement Award

    Photo: New Africa

    R.J. Reynolds Vapor Co. owes Philip Morris Products more than $14 million after a federal judge on Aug. 17 increased a jury’s June patent-infringement award over vapor products to include prejudgment interest and supplemental damages, reports Bloomberg Law.

    Judge Leonie M. Brinkema amended the judgment entered June 15 in the U.S. District Court for the Eastern District of Virginia to reflect a total judgment amount of $10.9 million for infringement of one patent and $3.16 million for infringement of another.

    In its June 15 judgement, the jury found that RJR’s Vuse Solo and Alto devices infringe two Philip Morris patents covering parts of a vaping device for heating substances and preventing leaks. At the same time, the jury cleared Vuse Alto of infringing one of the patents.

    The verdict concerned counterclaims in RJR’s ongoing patent lawsuit over PMI’s IQOS heated-tobacco device. RJR won an order blocking IQOS imports at the U.S. International Trade Commission last November.

    Philip Morris succeeded earlier this year in invalidating parts of some patents RJR accused it of infringing at a U.S. Patent Office tribunal.

    RJR parent company BAT has also sued Philip Morris over IQOS in the United Kingdom, Germany and elsewhere. A PMI filing with the U.S. Securities and Exchange Commission earlier this year said IQOS patent lawsuits and challenges outside of the U.S. have “repeatedly and universally failed.”

    Altria has separately sued Reynolds for patent infringement in North Carolina over the Vuse line.

  • D.C. Court Rejects Prohibition Juice Co. Appeal of MDO

    D.C. Court Rejects Prohibition Juice Co. Appeal of MDO

    On July 26, the United States Court of Appeals for the District of Columbia rejected an appeal by four e-liquid manufacturers that challenged the FDA’s denial of their premarket tobacco product applications (PMTAs), ruling that the agency acted within Congress’ authorization, and its decisions were supported by evidence.

    Prohibition Juice Co., Cool Breeze Vapor, ECig Charleston, and Jay Shore Liquids argued that the FDA lacked statutory authority to require that the manufacturers establish that their flavored liquids carry greater public health benefits than unflavored liquids.

    According to the motion, the companies also challenged the PMTA denials as arbitrary and capricious, asserting that the FDA: (1) departed from an earlier guidance document, changing both the types of evidence the agency would accept and the substantive showing it expected parties to make; (2) underscored the potential importance of marketing plans including measures to limit youth access to their products but then failed to consider the plans petitioners submitted; and (3) overlooked various other aspects of the problem.

    “We deny the petitions for review. The FDA plainly had statutory authority under the Tobacco Control Act to regulate as it did. As to the arbitrary and capricious challenges, we hold that the FDA did not change the evidentiary or substantive standard from its 2019 Guidance,” the court wrote in its motion. “We also hold that any error in the FDA’s failure to consider the marketing plans was harmless because the manufacturers failed to identify how individualized review of the plans they submitted could have made any difference.

    “Finally, the FDA did not otherwise fail to consider important aspects of the problem. We accordingly deny the petitions for review.”

    The D.C. Circuit has not stayed the enforcement of any MDO.

  • Court: No Confusion in ‘Raw’ Cannabis Trademark Case

    Court: No Confusion in ‘Raw’ Cannabis Trademark Case

    The District Court of Arizona Tuesday issued an order in a trademark dispute between BKK Tobacco & Foods and Central Coast Agriculture Incorporated (CCA), a cannabis products manufacturer.

    The mixed ruling granted the defendant cannabis company’s summary judgment motions, but voided their trademark applications for lack of demonstrated intent to use in commerce, according to lawstreetmedia.com.

    Further, the complaint states that in late 2013, Central Coast Agricultural Incorporated (CCA) began distributing cannabis concentrate products branded as “RawCo2,” “Raw Hashish,” “RawSin” and “Raw Gold.” The order also states that in 2016, CCA began selling cannabis concentrates under the unified brand “Raw Garden.”

    On September 18, 2019, BKK initiated the present lawsuit alleging trademark infringement, false designation of origin, false advertising, unfair competition, cybersquatting and a petition to void several trademark applications by CCA due to a lack of a bona fide intent to use. On May 4, 2021, the court granted CCA’s motion to dismiss the false advertising claim but declined to dismiss the petition to void the trademark applications.

    CCA moved for summary judgment on BBK’s infringement, false designation of origin, cybersquatting and unfair competition claims and raised a number of affirmative defenses including laches, waiver, estoppel, acquiescence, statute of limitations and unclean hands. Additionally, BKK filed cross-motions for summary judgment for all of CCA’s affirmative defenses and counterclaims and BKKS petition to void CCA’s trademark applications.

    The court ruled that there is no likelihood of confusion between BKK’s Raw trademark and CCA’s applications for Raw Garden and thus granted CCA’s summary judgment motion, lawstreetmedia.com writes.

    Further, the court stated that because no likelihood of confusion exists, the court declined to address CCA’s laches and unclean hands defenses.

    However, the court granted BKK’s motion for summary judgment to void CCA’s trademark applications because CCA failed to provide evidence showing that it intended to use the Raw Garden trademark in connection to non-hemp-related products as identified in the trademark application, according to lawstreetmedia.com.

    Due to the court’s ruling in the various motions for summary judgment, it closed the case stating that all claims and counterclaims asserted by the parties have been resolved or rendered moot by its order.

  • Court Denies Triton, Vapetasia Review of FDA Orders

    Court Denies Triton, Vapetasia Review of FDA Orders

    Fifth Circuit Court of Appeals

    Two e-liquid manufacturers may be forced to pull their products from store shelves after they lost their bid to force the U.S. Food and Drug Administration to allow them to market their vaping products.

    The U.S. Court of Appeals for the Fifth Circuit denied Wages and White Lion Investments LLC, doing business as Triton Distribution, and Vapetasia LLC’s requests Monday for review of the agency’s marketing denial orders (MDOs) in a 2-1 decision.

    The manufacturers didn’t show that the FDA acted arbitrarily or capriciously when it rejected their premarket tobacco product applications (PMTAs), the Fifth Circuit said.

    “In a mockery of ‘reasoned’ administrative decision-making,” Judge Edith Jones, a former chief judge of the Fifth Circuit who has served since the Reagan administration, wrote in her dissent. “FDA (1) changed the rules for private entities in the middle of their marketing application process, (2) failed to notify the public of the changes in time for compliance, and then (3) rubber-stamped the denial of their marketing applications because of the hitherto unknown requirements.”

    If the ruling holds, Triton and Vapetasia will not be able to sell their reduced-risk electronic nicotine-delivery system (ENDS) products.

    The companies had applied to market products with flavors like sour grape, pink lemonade, crème brulee and milk and cookies and names such as “Jimmy The Juice Man Strawberry Astronaut” and “Suicide Bunny Bunny Season.”

    Dozens of other smaller vape companies also have accused the regulatory agency of operating unfairly, and will likely be disheartened by this ruling, reports Alex Norcia for Filter.

    Todd Wages, a partner at Triton Distribution, told Filter he was “very disappointed” in the court. “We’re exploring our next steps. I will not stop fighting until I can’t any longer, until every door is closed,” he said.

    The FDA rejected applications to market 55,000 flavored e-cigarettes in August, 2021, including Triton’s, and said applicants would likely need to conduct long-term studies establishing their products’ benefits to win approval.

    A Fifth Circuit panel in October then agreed with Triton’s claim that the new requirement for long-term studies differed from earlier FDA guidance and called the action a “surprise switcheroo” and the panel allowed Triton to keep selling its e-cigarettes until another panel could hear its appeal.

    Eric Heyer, the lawyer representing Triton Distribution, told Filter that the company “intends to file a petition for rehearing en banc by the entirety of the Fifth Circuit.”

    Most circuit court appeals are decided by a three-judge panel, however special circumstances could motivate the court to allow a majority of the active judges to vote to rehear the case “en banc.”

    Moving forward, Triton had asked the court in briefs to allow the company to “enjoin FDA from taking further adverse action on the Petitioners’ PMTAs for 18 months to allow Petitioners to conduct the necessary studies to prove comparative efficacy” if the panel ruled against Triton. The court denied that request.

  • VPR Brands Wins Patent Appeal for Airflow Sensor

    VPR Brands Wins Patent Appeal for Airflow Sensor

    Credit: New Africa

    The Patent Trial and Appeal Board (PTAB) of the United States Patent and Trademark Office ruled to uphold the validity of a VPR Brands patent that is considered one of the first patents for modern electronic nicotine-delivery system (ENDS) products.

    The PTAB denied the appeal filed by Jupiter Research (case No. IPR2022-0029) that was seeking to invalidate the VPR’s U.S. Patent number 8,205,622 B2. The decision of the PTAB is not appealable.

    The VPR patent dates to 2009 and includes independent claims covering electronic cigarette products containing an electric airflow sensor, including a sensor comprised of a diaphragm microphone, according to a press release.

    The sensor turns the battery on and off, and covers most auto-draw, button-less e-cigarettes, cig-a-likes, pod devices and vaporizers using an airflow sensor rather than a button.

    The PTAB’s decision denying institution clears the way for VPR’s infringement litigation against Jupiter pending in the District of Arizona to proceed. Claim construction in that pending suit has already been completed. While some discovery still remains, the case should proceed to pre-trial motions this year, according to the release.

    VPR Brands along with its representation, SRIPLAW, has started to identify and notify over 50 of the leading companies using the auto-draw technology and VPR Brands intends to vigorously enforce its patent.

    “These companies were prioritized, based on sales volume and popularity. Most recently VPR Brands LP and its legal team, headed by Joel B Rothman of SRIPLAW, have filed litigation against nine of the companies,” the release states. “Additional lawsuits will continue to be filed as necessary to protect the company’s intellectual property rights.”

    A majority of the vaping devices sold in the U.S. now utilize an auto-draw/button-less technology. The company is investigating all button-less vape devices within the nicotine, CBD and cannabis space that initiate vaporization from the user’s airflow inhalation as those types of products would be suspect of infringement.

    The company may also seek a buyer for this patent in the future. In August 2013, Imperial Tobacco Group (now ITG Brands) purchased the intellectual property behind the Ruyan e-cigarette, often considered the first modern ENDS product, for $75 million.