On April 9, 2020, RJ Reynolds Tobacco Company and its affiliates (“Reynolds”) filed complaints before the United States International Trade Commission (“ITC”) and the United States District Court for the Eastern District of Virginia seeking to stop Altria Group (“Altria”), Philip Morris International (“PMI”) and certain of their respective affiliates from importing and selling the IQOS heated tobacco device system.  This system is a “heat not burn” device whereby the user inserts a disposable “tobacco stick” into an electronic holder and turns on the device, which then heats the tobacco stick enough to generate an aerosol but not combust the stick.  Continue Reading RJ Reynolds Sues Altria and Philip Morris International to Stop IQOS Imports

In early April, Virginia Governor Ralph Northam signed Senate Bill 918, approving industrial hemp extract, such as cannabidiol (“CBD”), as a food, subjecting it to applicable laws and regulations.  The bill defines “food” as “any article that is intended for human consumption. . . [and] does not mean drugs as defined in [Va. Code] § 54.1-3401.” The bill establishes requirements for the production and manufacture of hemp extracts and authorizes the Virginia Board of Agriculture and Services to adopt regulations regarding contaminant tolerances, labeling, and batch testing. Continue Reading Virginia becomes the most recent state to regulate hemp extracts as food

On March 27, 2020, the President signed the Coronavirus Aid, Relief, and Economic Security Act, expanding the Small Business Administration’s (SBA’s) 7(a) loan program by establishing the Paycheck Protection Program (PPP). The PPP authorizes up to $349 billion in federally backed loans through June 30, 2020, or until funds run out, for many small businesses across the country. Continue Reading Paycheck Protection Program Loans for Tobacco, Hemp, and Marijuana Businesses?

On April 3, 2020, several tobacco companies, including R.J. Reynolds, Imperial and Liggett, filed suit in a Texas federal court challenging the U.S. Food and Drug Administration’s (“FDA”) March 2020 rule requiring the placement of graphic warnings on cigarette packaging and advertising (“the Rule”). Continue Reading Tobacco Companies Challenge FDA’s Rule Requiring Cigarette Graphic Warnings

Will the May 12 deadline for premarket tobacco applications and substantial equivalence reports remain in place?  The FDA has decisively moved in that direction, but the final answer will depend upon further proceedings

There was a significant development on April 3, 2020, when Judge Paul W. Grimm of the U.S. District Court for the District of Maryland issued an indicative ruling in American Academy of Pediatrics, et al. v. FDA, et al., No. 8:18-cv-00883 (D. Md.), on appeal, Nos. 19-2130, -2132, -2198, -2242 (4th Cir.).  Judge Grimm indicated that, “if the case were remanded for that purpose,” he would grant the FDA’s motion to extend the deadline to September 9 “in light of the global outbreak of respiratory illness caused by a new coronavirus.”  The case is pending with the U.S. Court of Appeals for the Fourth Circuit, which would have to order a limited remand prior to Judge Grimm’s issuing any actual ruling on the extension. Continue Reading FDA and Federal Court Move Toward Extension of May 12 Deadline for Premarket Review Applications

The Securities and Exchange Commission (SEC) continues to investigate cannabis companies for possible enforcement actions related to investment fraud and market manipulation, with an increasing focus on Canadian companies. Most recently, Cronos Group, one of the largest cannabis producers in Canada, received an inquiry from the SEC related to its revenue recognition practices. As reported by MarketWatch, a Cronos company lawyer sent an e-mail to employees on March 10 instructing staff to retain certain records pertaining to a “confidential and non-public inquiry by the Securities and Exchange Commission.” Continue Reading Canadian Cannabis Company Receives SEC Inquiry Over Revenue Recognition

Did you know that there are special environmental requirements for businesses manufacturing, distributing and selling electronic nicotine delivery systems (ENDS)?  Late last year, the Environmental Protection Agency added e-cigarettes, vape pens and certain e-liquids as hazardous waste pharmaceuticals under a final rule entitled “Management Standards for Hazardous Waste Pharmaceuticals and Amendment to the P075 Listing for Nicotine.” The rule requires companies to provide certain training, complete reporting, and maintain recordkeeping, among other obligations. Failure to comply can result in enforcement and penalties.

If you manufacture or distribute ENDS products, please let us know how we can help you comply with these regulations.

 

Did you know that businesses selling tobacco products on the Internet can potentially be required to comply with requirements under the Americans with Disabilities Act?  There is a line of cases ruling that websites must be accessible for individuals who are sight-impaired, and there are specific requirements for doing so.  As some of our clients have learned, failure to adhere to these requirements may subject companies to litigation.  Please let us know how we can help – we have a team of experts in this field. 

We hope that our clients and friends are managing in these unprecedented times.  The Troutman Sanders Tobacco Team is now working in a remote environment, thanks to amazing support from the Firm.  As part of our business continuity planning, Troutman Sanders has a plan to address situations where our physical offices may be unavailable or where our attorneys and staff might need to work outside the office for extended periods of time. The plan provides capabilities for attorneys and staff to work remotely and continue to provide legal services to our clients.  We continue to actively serve clients (and are as busy as we have ever been), so please let us know how we can help. Continue Reading Troutman Sanders Tobacco Team COVID-19 Update