The cigar industry is celebrating a legislative victory against the U.S. Food and Drug Administration as U.S. District Court Judge Amit Mehta has ruled that the warning label requirement imposed on the premium cigar industry by the FDA is illegal. Judge Mehta based his ruling on several conclusions including how the warning label requirement would violate manufacturers’ First Amendment rights and that it violates the Administrative Procedure Act, which outlines how the FDA develops and enforces its rules.
This ruling took into account two lawsuits–Cigar Association of America et. Al v. United States Food and Drug Administration et al. and En Fuego Tobacco Shop et. Al. v. United States Food and Drug Administration et al. In the Enfuego Tobacco Shop case, the FDA argued that because all three plaintiffs in the case had ties to the International Premium Cigar & Pipe Retailers Association (IPCPR), now known as the Premium Cigar Association (PCA), the Enfuego Tobacco Shop lawsuit was invalid. Mehta, however, chose not to acknowledge this claim.
Mehta questioned the entire warning label plan which would require manufacturers to submit warning label plans for their products 12-months in advance. He also questioned the validity of the the law based on who signed it. Mehta’s ruling also questions why the FDA has yet to settle on a definition of a premium cigar, noting that it’s willingness to even consider a premium cigar exemption meant that the agency understands how the premium cigar category is not all the same and may call for a different overall approach when it comes to regulating.
Mehta summarized his decision as a failure of the FDA to “articulate a reasoned basis for requiring warning labels for premium cigars.” He went on to say, “By failing to analyze whether consumers are in fact misinformed or underinformed as to premium cigar health effects, the agency has failed to offer the rational connection between facts and judgment required to pass muster under the arbitrary and capricious standard.”
J.C. Newman Cigar Company, a family-owned premium cigar company that has been among the more active manufacturers advocating for regulatory relief since the announcement of the Deeming Rule, released the following statement:
For 125 years, my family has been carefully packing our handcrafted cigars in decorative wooden boxes with beautiful cigar labels and bands. FDA wanted to cover 30% of a cigar box with a large health warning label. This would have destroyed the historic character of premium cigar packaging and turned walk-in humidors in premium cigar stores into large billboards for the FDA.
Today, Judge Mehta recognized that premium cigars are different and that FDA cannot ignore that fact. He concluded that there was an insufficient legal basis for FDA to require warning labels for premium cigars. Therefore, he struck down the warning label requirement, sending it back to the agency for further consideration. The practical effect of this decision is that there is no longer a federal requirement to apply warning labels to premium cigars.
Today is an important and historic day for the American premium cigar industry, and we should celebrate it. However, our victory is not complete. Premium cigars are still regulated by FDA, and we are 99 days away from the May 12, 2020 premarket review deadline. In three months, we will be required to file substantial equivalency reports for all new cigars first sold after 2007. This is a monumental and exorbitantly expensive requirement that no one has been able to meet, and we urgently need relief from it.
We are very grateful to the plaintiffs in Texas for litigating this case and for Cigar Rights of America and the Premium Cigar Association for to continuing to advocate on behalf of the premium cigar industry. My family and I look forward to continue working with them and others in the industry to ensure that America’s premium cigar tradition can continue for generations.
With the warning label requirement now struck down, attention is turning to the next legal challenge–Substantial Equivalence (SE). Set to go into effect on May 12, 2020, this part of the Deeming Rule forces all deemed tobacco products, including premium cigars, to submit an application for any tobacco product that was released after 2016 [read more here]. This process has yet to be clearly defined by the FDA and will place a financial burden on manufacturers who will be tasked with gathering required information for the FDA to review in order to keep their products on the market.
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