In an earlier blog post, we discussed a case pending before the United States Court of Appeals for the Fourth Circuit in which the United States District Court for the Eastern District of Virginia evaluated the methodology used by the United States Department of Agriculture (the “USDA”) to determine the amount of assessments levied against tobacco product manufacturers and importers under the Fair and Equitable Tobacco Reform Act (“FETRA”). Philip Morris sued the USDA, claiming that the USDA had improperly calculated the FETRA assessments.

An article by the Troutman Sanders Tobacco practice appears in the October issue of Smokeshop Magazine. The article, titled “The Uncertain Future of E-Cigarette Marketing”, discusses how major players in the e-cigarette market are building brand awareness and market share by using forms of advertisement that are unavailable to cigarette companies. 

The Troutman Sanders Tobacco practice is proud to be participating in the Tobacco Merchants Association (“TMA”) FDA Regulation of E-Cigarettes Conference. This one-day conference will focus on the latest developments in FDA’s proposed e-cigarette regulation. The program will host industry experts as well as members of the legal field as they discuss the e-cigarette market and the impact of regulations similar to FDA’s current regulations regarding cigarettes and other tobacco products.

The Troutman Sanders Tobacco practice is proud to be participating in the Food and Drug Law Institute’s (“FDLI”) FDA Regulation of Tobacco Products Conference. This one-day conference will focus on latest developments in FDA tobacco product regulation, both in review for 2013 and in the future. The program will host government, industry and public interest experts in order to provide updates on various issues, such as changing product standards and current and future research efforts, in addition to a discussion of the regulation of modified-risk tobacco products, especially in reference to electronic cigarettes.

On April 4, 2013, the Supreme Court of Mississippi declared unconstitutional the imposition of a nonsettling-manufacturer (“NSM”) fee on cigarettes that are distributed through Mississippi for sale to a retailer outside of the state.  In 2009, the Mississippi Legislature enacted a law imposing a fee for nonparticipating manufacturers on the sale, purchase, and distribution in Mississippi of cigarettes “including cigarettes sold, purchased or otherwise distributed in [Mississippi] for sale outside of this state.”  Miss. Code Ann. § 27-70-5 (Rev. 2010) (emphasis added).

As mentioned in a previous blog post, on September 11, 2013, a three-member federal arbitration panel decided the on-going dispute among three participating manufacturers (“PMs”) and 15 states involving the 2003 payment obligations under the Master Settlement Agreement (“MSA”).

In a blog post on January 26, 2013, we discussed a decision from the United States District Court for the District of Rhode Island where several tobacco companies challenged the constitutionality of two local ordinances.  The lawsuit sought to overturn two Providence, Rhode Island ordinances, which ban certain promotional discounts and severely restrict the sale of flavored tobacco products.

As mentioned in a previous blog post, on September 11, 2013, a three-member federal arbitration panel settled the on-going dispute among three participating manufacturers (“PMs”) and 15 states involving the 2003 payment obligations under the Master Settlement Agreement (“MSA”).

New York is one of the states that the arbitrators ruled in favor of in denying the PMs a credit under the non-participating manufacturer (“NPM”) Adjustment.  The arbitration panel concluded that “the MSA’s first condition for application of the 2003 NPM Adjustment was satisfied: the PMS had suffered a ‘Market Share Loss’ for 2003.”  In particular, the independent auditor calculated approximately an 8 percent market-share shift from the PMs to the NPMs from 1997-2003.  New York (nor any of the other 14 states) disputed the auditor’s finding that the PMs suffered a market share loss in 2003. 

As a result of the Master Settlement Agreement (“MSA”), each year every participating manufacturer (“PM”) is required to make an annual payment that is based on the number of cigarettes it sells nationwide.  This payment obligation does not apply to non-signatories to the MSA, known as non-participating manufacturers (“NPMs”).  In an effort to equalize the impact on the PMs, the MSA contains a provision requiring each Settling State to enact a statute to collect escrow from the NPMs, thereby imposing similar financial obligations on NPMs.