State Regulatory

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FDA recently issued draft guidance regarding how a manufacturer can establish that its tobacco product was commercially marketed in the United States as of February 15, 2007, thus exempting the product from the onerous premarket requirements of the Tobacco Control Act (“TCA”).  The guidance first explains that FDA interprets the phrase “as of February 15, 2007” as meaning that a tobacco product was commercially marketed – not in test markets – in the United States on February 15, 2007.

Several years ago, the state of California filed suit against Native Wholesale Supply Company (“NWS”) for allegedly violating California’s MSA, cigarette fire safety, and unfair competition laws.  NWS, a tribally-chartered corporation headquartered in New York, sells and distributes cigarettes manufactured by the Canadian tribally-owned corporation Grand River Enterprises Six Nations.  In California, NWS primarily sells these cigarettes to Big Sandy Rancheria.  Big Sandy – or other Indian retailers in California to which Big Sandy directs NWS to transport Grand River cigarettes – then sells the cigarettes to the California general public.  Since late 2003, NWS has delivered over 325 million cigarettes, worth nearly $12 million, to California.  

The Chicago Tobacco Prevention Project (“CTPP”) is awarding grants to several housing organizations to encourage the adoption of smoke-free policies in apartment and condos in Chicago.  The CTPP represents an effort to create more smoke-free multi-unit residential properties in Chicago as part of the project’s overall effort to reduce smoking rates and exposure to secondhand smoke. The Project is run by the Respiratory Health Association of Metropolitan Chicago, in collaboration with City of Chicago’s Department of Public Health.  For more information: www.lungchicago.org/ctpp

Effective July 1, 2011, it is a criminal offense to sell electronic cigarettes (“e-cigarettes”) to minors in the State of Colorado.  Colorado Governor John Hickenlooper signed the law in March, which is codified at Colorado Revised Statutes, section 18-13-121.  The new law characterizes e-cigarettes as a “tobacco product.”  A person who violates the new law commits a class 2 petty offense, which may be punishable by a fine of two hundred dollars.  The new law also provides that municipalities may impose more stringent requirements than provided in this section of the Colorado Criminal Code.

As reported in the Boston Globe, the City of Worcester seems to be among one of the first localities to take advantage of powers provided  by the federal 2009 Family Smoking Prevention and Tobacco Control Act.   That Act allows not only states but also localities to impose “specific bans or restrictions on the time, place and manner” of cigarette advertising.  The Worcester City Council, taking advantage of such provisions enacted a local ordinance banning any tobacco brand advertising visible from streets, parks and schools.   The initiative for the City Council action was a mounting campaign by teenagers who had statics regarding not only the health effect of smoking but also how outdoor advertising was concentrated in low-income communities, especially in communities of color.

On April 25, FDA announced that it will regulate smokeless electronic cigarettes (“e-cigarettes”) as tobacco products and not as drug-delivery devices, which are subject to more stringent regulation.  FDA said it will propose rule changes to treat e-cigarettes the same as cigarettes and other tobacco products.  While FDA regulation is coming into focus, uncertain issues involve how state and local governments will regulate e-cigarettes.  It is critical that e-cigarette manufacturers and vendors gain an awareness of this rapidly changing regulatory landscape.

A bill is currently pending before the Nebraska legislature that would impose significant new requirements for nonparticipating manufacturers to the MSA and relating to tribal sales.  Legislative Bill 590, which was introduced on January 19, 2011 and reported from the legislature’s revenue committee (as amended) on April 7, 2011, also would impose stringent new requirements regarding the taxation and sale of tobacco products.  The bill appears to be spearheaded by the Nebraska Attorney General, who is co-chair of the National Association of Attorneys General Tobacco Committee.

With respect to nonparticipating manufacturers, the Nebraska bill: