FDA Responds in Premium Cigar Lawsuit Appeal, Oral Arguments Next

The lawsuit over the regulation of premium cigars in the U.S. should be ready for its next step.

Yesterday, the Department of Justice filed its response in Cigar Association of America et al. v. United States Food and Drug Administration et al., the nearly eight-year-old lawsuit over the FDA’s regulation of premium cigars.

Last August, this lawsuit resulted in a major victory for the cigar industry when Judge Amit P. Mehta ruled in favor of the three cigar trade groups that filed the case, finding that the FDA failed to properly evaluate comments submitted to the agency prior to the enacting of the deeming rule. This meant that cigars that meet the definition of “premium cigars”—large handmade cigars that are not flavored—were no longer subject to FDA’s deeming regulations, such as testing requirements, user fees and a ban on giving away those cigars for retail promotions or charitable donations.

After that ruling, the DOJ—which represents the FDA in legal matters—signaled that it would appeal Mehta’s ruling. Accompanied by some minor delays, that appeal has been working its way through the process. Yesterday’s brief was in response to last month’s reply from the cigar industry side: the Cigar Association of America, Cigar Rights of America and the Premium Cigar Association. Barring any unplanned developments, the next major chapter in the appeal will take place in a courtroom, where attorneys from both sides will argue before the three judges of the U.S. Court of Appeals for the District of Columbia who will decide this appeal.

As has been the case in most of the appeal’s documents, the DOJ’s reply was largely a rehashing of old arguments. There were some newer arguments, including multiple times when the government argued that the cigar industry has misrepresented what overturning Mehta’s ruling would mean in regard to immediate regulation. Specifically, the DOJ argued that the cigar industry has misrepresented requirements for costly testing and manufacturing standards.

While it is true—as the DOJ argues—that the FDA has delayed product testing for premium cigars, that action was seemingly done in direct response to this lawsuit. In August 2020, shortly before Mehta was expected to rule, FDA delayed the testing requirements for premium cigars. The agency has not indicated if it were to win the appeal what would happen to the testing requirements. This is especially complicated as the FDA lost a separate lawsuit that resulted in a different federal court accelerating the timeline of testing requirements, something that presumably would apply to premium cigars.

It is also true that the FDA’s tobacco manufacturing standards wouldn’t immediately take effect if the FDA were to win an appeal. Those rules have been proposed but are not finalized. However, under the status quo, those finalized rules wouldn’t apply to factories that solely make premium cigars. That said, it’s likely that they would apply to many cigar factories because not every cigar factory makes solely premium cigars.

For example, factories like the La Aurora Cigar Factory and La Gran Fábrica Drew Estate, both of which make premium cigars and handmade flavored cigars, would be subject to these requirements as they produce some cigars that aren’t covered by the “premium cigar” definition that FDA has used throughout this lawsuit. Regardless of the outcome of this appeal, cigars that don’t meet that definition are already subject to FDA regulation.

The court has not scheduled oral arguments; due to its summer schedule, they would not take place until August at the earliest.

Charlie Minato

I am an editor and co-founder of halfwheel.com/Rueda Media, LLC. I previously co-founded and published TheCigarFeed, one of the two predecessors of halfwheel. I have written about the cigar industry for more than a decade, covering everything from product launches to regulation to M&A. In addition, I handle a lot of the behind-the-scenes stuff here at halfwheel. I enjoy playing tennis, watching boxing, falling asleep to the Le Mans 24, wearing sweatshirts year-round and eating gyros. echte liebe.