State Regulatory

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On September 2, 2026, a group of tobacco product manufacturers and retailers filed a complaint in federal court, the U.S. District Court for the Northern District of Texas, challenging the U.S. Food and Drug Administration’s (FDA) 2021 premarket tobacco product application (PMTA) rule. Plaintiffs take aim at a regulation they say has made it virtually impossible for the FDA to authorize new tobacco products within the timeline Congress set more than 15 years ago. The case raises fundamental questions about whether a federal agency can adopt a regulatory process that, by design, cannot meet its own statutory deadlines.

This article was originally published on Law360 and is republished here with permission as it originally appeared on August 21, 2026.

On July 30, two federal appeals courts permitted the enforcement of state laws in Iowa and North Carolina conditioning the sale of electronic nicotine delivery systems, or ENDS, on a manufacturer’s certification of compliance with U.S. Food and Drug Administration premarket review requirements.[1]

Our team recently attended, and presented at, the 100th Annual Meeting of the Federation of Tax Administrators (FTA) Tobacco Tax Section in Washington, D.C., which brought together state tobacco tax administrators, excise tax professionals, attorneys general, compliance officers, tax filing solution providers, and other industry stakeholders. Despite the challenge of navigating our Nation’s Capital in light of preparation for the Freedom 250 Grand Prix, we are glad we had the opportunity to attend and connect with colleagues to advance thought leadership in the tobacco and nicotine industry. The meeting included a line-up of speakers who discussed topics highly relevant to industry, and we wanted to highlight a few themes that emerged related to state vapor and nicotine product directories, nicotine analogues, enforcement, and destruction of illicit vapor products.

The Texas Supreme Court (the Court) recently issued an important tax decision for modern oral nicotine products, such as nicotine pouches. In Hancock v. RJR Vapor Co., LLC, the Court held in favor of Acting Comptroller Hancock, finding that RJR Vapor Co., LLC’s (RJR) VELO oral nicotine pouches are taxable as “tobacco products” under the Texas tobacco products tax, and reversed a lower court decision holding that they were not taxable “tobacco products.”

Over the last couple of years, we have written about a federal case brought by the Twenty-Nine Palms Band of Mission Indians (the Tribe) (here, here, and here) involving key issues related to the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) authority to enforce the Prevent All Cigarette Trafficking Act (PACT Act) against federally recognized Indian tribes and ATF’s interpretation of key sections of the PACT Act. The Ninth Circuit Court of Appeals recently upheld a federal district court’s decision ruling against the Tribe.

For years, we have written (here, here, here, and here) about the decade-long effort to vacate the U.S. Food and Drug Administration’s (FDA) decision to “deem” premium cigars covered by FDA’s 2016 rule (the Deeming Rule), which swept all tobacco products under FDA authority. On April 15, the U.S. District Court for the District of Columbia issued an order that it characterized as “(hopefully) … the final chapter” in the litigation over how FDA regulates premium cigars. The parties have 30 days to appeal the order, but, if not, the order will stand.

On April 14, Iowa Attorney General (AG) Brenna Bird, leading a coalition of 13 state AGs, sent a pointed letter to Visa, Mastercard, American Express, and Discover. Their message was clear: payment networks are expected to help shut down the U.S. market for unauthorized e‑cigarette products.

For financial services institutions that support e-cigarette merchants — card networks, sponsor banks, acquirers, independent sales organizations (ISOs), payment service providers (PSPs), and platforms — this letter is the latest signal of increased regulatory and enforcement risk for financial services companies that provide services to sellers of unauthorized e-cigarette products.

The North Carolina Court of Appeals recently issued a decision strengthening the “sealed container” defense available to non‑manufacturing sellers in products liability cases. In Weaver v. AMV Holdings LLC, the court found in favor of a vape retailer and distributor after a lithium‑ion battery malfunctioned in a customer’s pocket, causing serious burns. For retailers and distributors — particularly those dealing with lithium‑ion batteries — this decision underscores the continued viability of sealed container defenses.

California recently finalized changes to its Proposition 65 (Prop 65) warning rules that included significant changes to short-form warning statements for product labels. These changes directly affect nicotine‑containing products — including e‑cigarettes, e‑liquids, oral nicotine products, and other consumer goods that can expose consumers to nicotine.

The Florida attorney general (AG) recently initiated legal proceedings against several Florida smoke shops, alleging violations of state law related to the sale and marketing of illegal nicotine products, particularly vapor products, to minors. The action targets multiple businesses, including 27 Smoke Shop Inc., A&A Smoke Shop LLC, Alami 9 LLC, Alami 10 LLC, Epic Novelty LLC, and Fuego Smoke Shop LLC. The complaint, filed in the Fifth Judicial Circuit, accuses these retailers of selling, shipping, or failing to remove from their inventory nicotine products that are classified as illegal contraband under Florida law, with a particular focus on products marketed to children.