State Regulatory

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On August 27, the New Jersey Attorney General (AG) and the Division of Consumer Affairs announced that the state had issued notices of violation and $4,500 civil penalty demands to 19 retailers across New Jersey for allegedly selling banned flavored vapor products. This is New Jersey’s first public enforcement of the state’s 2020 flavor ban, and New Jersey joins a number of other state AGs taking similar action across the U.S.

On August 2, the U.S. Court of Appeals for the Eighth Circuit decided a case addressing Nebraska’s authority to require tribal cigarette manufacturers that are not parties to the Master Settlement Agreement (MSA) to comply with the state’s escrow statute with respect to cigarettes sold in Indian country. See HCI Distrib., Inc. v. Peterson, No. 23-2311 (8th Cir., Aug. 2, 2024).

In this post, we take a closer look at state tobacco and nicotine product licensing considerations. When approaching state licensing issues, it may be helpful to establish a checklist to help manufacturers, importers, distributors, and retailers determine the impact of these laws on their products and distribution models. State licensing requirements can be complicated but, with a basic understanding of the key issues described below and good practices, manufacturers, importers, distributors, and retailers can ensure they remain compliant.  

The landscape of tobacco product and cannabis flavor bans or restrictions varies significantly across the country. In both industries, some states restrict all or some flavors in all types of products, while other states restrict all or some flavors in some, but not all, products. Below, we provide a high-level overview of the flavor ban and restriction landscape in both industries. As we will discuss, there is a wide disparity between cannabis and tobacco product flavor bans or restrictions and, where they exist, there appears to be more flexibility among cannabis flavor restrictions than for tobacco product flavor bans or restrictions.

In August 2023, Judge Amit P. Mehta of the U.S. District Court for the District of Columbia partially vacated a Food and Drug Administration (FDA) rule that had “deemed” premium cigars subject to the Federal Food, Drug, and Cosmetic Act (FDCA), known as the “Deeming Rule.” This decision exempted premium cigars from FDA’s tobacco product authorities. In September 2023, however, FDA appealed, and the U.S. Circuit Court of Appeals for the D.C. Circuit is currently weighing the matter. So, what would it take for FDA to succeed on appeal, and what is at stake for the premium cigar industry?

The Massachusetts Supreme Judicial Court (SJC) recently upheld, in a unanimous decision, the town of Brookline’s ordinance banning the sale of tobacco and e-cigarette products to anyone born after Jan. 1, 2000 (the Tobacco Sales Ban). Brookline is the first U.S. locality to impose a tobacco sales ban based on a specific date.

A couple of years ago we posted an overview of state licensing and excise tax considerations for tobacco companies. In this post, we take a closer look at state excise tax considerations. When approaching state excise tax issues, it may be helpful to establish a checklist to help manufacturers, distributors, and retailers determine the impact of these laws on their products and distribution models.

Over the past decade, at least five states and hundreds of localities have passed, or attempted to pass, laws banning flavored tobacco products. To date, litigants have brought many challenges to these laws, often arguing that such bans are preempted under the federal Family Smoking Prevention and Tobacco Control Act (TCA). This argument, however, has largely proven unsuccessful — a trend that continued in January when the U.S. Supreme Court declined to hear R.J. Reynolds Tobacco Company’s challenge to California’s ban on the sale of flavored tobacco products.