FDA Continues Litigating Tobacco Advertising Rules

July 15, 2010

The enactment of the Family Smoking Prevention and Tobacco Control Act on June 22, 2009, granted broad and sweeping authority to FDA to regulate tobacco products. The scope of authority includes adopting standards for the type and method of advertising, and even dictating the packaging of tobacco products.

FDA has started exercising its authority in a variety of ways including the adoption of 21 C.F.R. §1140.16(a) which says that a tobacco product manufacturer is prohibited from using a trade name or brand that is also used for a non-tobacco product, unless the name was used for the tobacco product prior to Jan. 1, 1995. A violation of the prohibition could result in criminal and civil fines, and FDA treating the tobacco products as adulterated.

The regulation is the subject of Tobacco Holdings Inc. and Al Harris v. US Food and Drug Administration et al, Case No. 3:10CV422, filed in the U.S. District Court in the Eastern District of Kentucky on June 21, 2010. The plaintiff asserts that the regulation is a violation of the First Amendment right to free speech, a violation of the right to equal protection and due process, a taking of property without compensation, and an unauthorized act by FDA. The plaintiff asserts that the regulation effectively makes certain brand and trade names illegal, even though they have been registered with the U.S. Patent and Trademark Office for more than a decade, and were perfectly legal in all other ways until the regulation was adopted.

For example, if a tobacco product is called “Rustler,” the regulation requires the tobacco manufacturer to stop using the name if an unrelated entity starts using “Rustler” for a non-tobacco product such as jeans or cars. The prohibition is applicable even if the name “Rustler” has been registered with the U.S. Patent and Trademark Office prior to the use of the name by the non-tobacco manufacturer.

The only exceptions are for those brand names that have been in used prior to 1995, which the plaintiff argues benefits the largest tobacco product manufacturers. The plaintiff asks the court to grant a preliminary and permanent injunction against FDA and to declare the regulation invalid.

Because of concerns about the regulation, FDA issued on May 4, 2010, guidance to the industry that it would not enforce the prohibition against tobacco brand names as long as they were: (1) used by the tobacco manufacturer before the non-tobacco manufacturer used the name; and (2) being used prior to June 22, 2009. The guidance does not address or resolve all of the issues, as is demonstrated by the Tobacco Holdings case which was filed six weeks after the guidance was adopted. The manufacturers are still at risk if they violate the regulation.

The Tobacco Holdings case is just one of several suits filed against FDA about the act. Questions will become more numerous as FDA starts to implement other parts of the act and adopt what some may perceive as overly restrictive regulations.