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April 24, 2015 Practice Points

Regulation and Litigation Surrounding E-Cigarettes

By Elizabeth V. McNulty

Electronic Cigarettes, commonly known as e-cigarettes, are battery operated nicotine and flavor delivery devices. Although e-cigarettes do not contain tobacco, users, known as "vapers," exhale a mixture of volatile organic compounds and heavy metals in a cloud of aerosol. Due to the concerns driven by e-cigarettes and the possible negative health effects, about two-thirds of major nations have regulated e-cigarettes in some way. See Barnaby Page (5 March 2015). "World's law-makers favour basing e-cig rules on tobacco." ECigIntelligence (Tamarind Media Limited). By contrast, regulations in the United States have been primarily generated at the state and local levels, followed slowly by the federal government. However, the ever-increasing controversy that the popularity—especially among minors—and escalating numbers of vapers has created substantial momentum toward greater national regulation.

As is often the case, California and New York have been at the forefront of state and local action. In 2010, the California Attorney General pursued two separate companies under California's Health & Safety Code, alleging that they each targeted minors in their marketing and misled consumers. See People v. Smoking Everywhere, Inc. No. RG10493637 (Alameda Superior Court) and People v. Sottera, Inc. No. RG10528622 (Alameda Superior Court). Both companies settled, and the marketing and efficacy claims asserted by each were tightly restricted by the settlement. Consumer class actions seeking to recover against other distributors for alleged misrepresentation in advertising quickly followed, citing the inconclusive and contested scientific studies regarding possible adverse health effects of vaping. See In re Njoy Inc., Consumer Class Action Litigation, No. CV-14-00428 (C.D. Cal., filed January 17, 2014) and Sheppard v. Fumizer, LLC, No. BC 558403 (Los Angeles Sup. Ct., filed Sept. 22, 2014). Not to be outdone, the California Department of Public Health released an advisory that addressed the health risks posed by e-cigarettes in January 2015, advising against the use of e-cigarettes, especially by children.

In New York, the state assembly, in a 125–0 vote, banned e-cigarettes in 2010. This move was followed by a 2013 New York City restriction on the sale of e-cigarettes (and other tobacco products) to persons under the age of 21, and a further prohibition on the use of e-cigarettes at both public and private spaces which went into effect in early 2014. See, generally, New York "Smoke Free Air Act".

Despite these active state based efforts, the Food and Drug Administration (FDA) regulatory movement has been delayed, with the lack of confirming scientific evidence regarding e-cigarettes standing as one of its largest impediments, coupled with the incredible amount of public interest in the pending regulations. Although numerous studies suggest that the chemical-laden aerosol generated by vaping leads to addiction and other negative health effects, the risks from e-cigarettes are simply undetermined, as acknowledged by the World Health Organization as recently as January 2015. Nonetheless, recent studies have indicated not only a link between e-cigarette use and an increase in cigarette or other tobacco use, but an increase is usage of the e-cigarettes by minors. See e.g., E-Cigarette Use in the Past and Quitting Behavior in the Future: A Population Based Study. Wael K. Al-Delaimy, et al., American Journal of Public Health, posted online on April 16, 2015.

Notwithstanding inconclusive scientific evidence, federal efforts have been ongoing. In 2009, the Family Smoking Prevention and Tobacco Act (Tobacco Act) was signed into law, creating the FDA Center for Tobacco Products and providing the FDA with the ability to regulate additional tobacco related products. Acknowledging the power created under the Tobacco Act, and noting the serious possible effects of e-cigarettes and what appears to be excessive underage use, the FDA issued a proposed "deeming" rule on April 25, 2014, including e-cigarettes, as one of several tobacco-related products for proposed regulation. Under the proposed rule, e-cigarettes would require registration with the FDA and reporting of product and ingredient listings, pre-marketing review and approval, restrictions on reduced risk claims until a determination by the FDA, and a prohibition on distribution of free samples. Significantly, the proposed regulation also sets minimum age and identification restrictions to prevent sales to underage youth and requires requisite health warnings.

Given the nationwide interest, it is unquestionable that the FDA will continue its efforts to finalize e-cigarette regulations as soon as practicable. And, as with any new regulations of consumer products, civil litigation will follow. Although e-cigarette companies have enjoyed a largely unchecked and widespread success, the continuation of that path, in light of the ongoing efforts and developing scientific evidence, seems questionable. Stay tuned.

Keywords: products liability, litigation, e-cigarette, FDA, regulation, tobacco

Elizabeth V. McNulty is with Archer Norris PLC in Newport Beach, California.

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