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Tag: RJR

  • Vape Industry Seeks to Block NC Law “Backed by Big Tobacco”

    Vape Industry Seeks to Block NC Law “Backed by Big Tobacco”

    Vape industry groups are urging the Fourth Circuit Court of Appeals to temporarily block enforcement of a new North Carolina law that could ban many e-cigarettes from the market. In an emergency filing, the groups claim the law was heavily influenced by Reynolds American Inc. and is designed to eliminate competition from vaping products that help smokers quit.

    The law prohibits the sale of vapor products that lack full FDA authorization, even though many remain under scientific review. Critics say this effectively bans nearly all independent vape brands in favor of a few tobacco-owned products that have gained approval.

    The plaintiffs argue the statute undermines federal regulatory authority, disrupts public health harm-reduction efforts, and was crafted to protect big-tobacco corporate interests over consumers. They are seeking an injunction to prevent what they describe as irreparable harm to small businesses and adult nicotine users seeking alternatives to smoking.

    The court has yet to rule on the request.

  • U.S. Supreme Court Backs RJR, Broader Legal Challenges to FDA

    U.S. Supreme Court Backs RJR, Broader Legal Challenges to FDA

    The U.S. Supreme Court ruled 7–2 in favor of R.J. Reynolds Vapor Company, allowing it to challenge FDA denials of e-cigarette marketing applications in the Fifth Circuit, even though the company is based in North Carolina.

    The decision effectively expands who can file lawsuits under the 2009 Family Smoking Prevention and Tobacco Control Act, now including retailers and trade groups affected by product bans, not just manufacturers. This enables tobacco companies to approach conservative-leaning courts like the Fifth Circuit, which has frequently ruled against FDA vaping restrictions.

    The FDA argued that retailers were never meant to be included under the legislation, and that 75% of e-cigarette appeals were being filed in the Fifth Circuit through strategic partnerships with local vape shops and trade groups, undermining consistent enforcement.

    Justice Amy Coney Barrett, writing for the majority, said that retailers are “adversely affected” because they lose potential sales or risk penalties by selling unapproved products. Justice Ketanji Brown Jackson, in dissent, warned the ruling contradicts Congress’s intent, allowing companies to bypass venue restrictions meant to streamline regulation.

    The case specifically involved menthol-flavored Vuse vapes, which the FDA had denied for failing to meet public health standards. The ruling now returns the case to the Fifth Circuit for further review.

  • Judge Rules ITG Owes Reynolds Full $251 Million

    Judge Rules ITG Owes Reynolds Full $251 Million

    Yesterday, a Delaware judge ordered ITG Brands to reimburse Reynolds American the full $251.5 million it paid to the state of Florida as part of a settlement agreement that pre-dated ITG’s acquisition of four cigarette brands a decade ago. ITG was attempting to cut the bill to $130 million by claiming Reynolds saved $112 million because ITG did not join the Florida settlement.

    “The payments Reynolds made to Florida on behalf of ITG-owned brands aren’t excluded under the companies’ purchase agreement, and Reynolds is owed reimbursement of that amount to restore it to the position it held before ITG failed to assume that liability,” Vice Chancellor Lori W. Will of the Delaware Chancery Court wrote.

    In 1997, Reynolds settled with Florida to resolve claims cigarette makers misrepresented the risks associated with smoking. In 2015, RJR sold its Kool, Maverick, Salem, and Winston brands to ITG for $7.1 billion. Florida’s settlement obligations assumingly shifted to ITG, but ITG didn’t sign on, leaving Reynolds to pay the full sum in 2023.

    “ITG was not found liable for failing to join the Florida settlement agreement,” Will said. “I did not hold that it breached any such obligation in the asset purchase agreement. ITG was, instead, found liable for failing to assume the liability imposed on Reynolds by the Florida court.

    “There is a fundamental problem with ITG’s argument. It centers the wrong harm. ITG presumes that the relevant breach is its failure to join the Florida settlement agreement. But I did not find that ITG breached any such obligation. I held only that it failed to assume the Florida judgment liability under [Asset Purchase Agreement] Section 2.01(c)(iv).”