Premium Cigar Company Sues FDA

Source from:  Cigar Aficionado 06/20/2016

A Miami-based cigarmaker is suing the Food and Drug Administration over the agency's new regulations on premium cigars. Global Premium Cigars, LLC., manufacturer and distributor of the Nicaraguan-made 1502 cigar brand, filed the civil action lawsuit on June 1 with the United States District Court for the Southern District of Florida. The suit accuses the FDA's Final Ruling of violating the company's First and Fifth Amendment rights and failing to meet certain regulatory obligations.

Plaintiff Enrique Fernando Sanchez Icaza, owner of Global Premium Cigars, is requesting that the FDA vacate and set aside its Final Ruling, declare that it exceeds the agency's authority and is unlawful. The lawsuit asks that the FDA be prohibited from taking any action outlined under the Final Ruling until a resolution is reached and the plaintiff be compensated for reasonable attorney's fees and expenses.

According to Global Premium Cigars' attorney, Frank Herrera, even in a best-case scenario it could still take close to a year-and-a-half for Icaza to see his day in court.

"There's no guarantee that there will be a trial, the government will file motions to dismiss," Herrera told Cigar Aficionado. The plaintiff may file a preliminary injunction in order to halt the regulations from taking effect until the case is decided, but hasn't done so yet.

The suit claims that the FDA is in violation of the Regulatory Flexibility Act, which requires federal agencies to consider the impact of its regulatory proposals on small entities; and the Administrative Procedure Act (APA), which deems government regulation unlawful if the agency implementing the regulation fails to "articulate a rational connection between the facts found and the choice made."

The FDA's Final Ruling, according to the lawsuit, unfairly restricts cigar companies that were founded after the predicate date of February 15, 2007 by limiting their approval options to the most expensive and time consuming pre-market tobacco application. The suit also argues that the 30 percent requirement for warning labels on cigar boxes has been arbitrarily assigned because the FDA has not provided scientific evidence that an enlarged warning label ensures visibility.

In a claim regarding First Amendment violations, the suit attests that any regulation that is not scientifically proven to contribute to the "primary justification" of the Tobacco Control Act—particularly the reduction of youth smoking—is seen as limiting a commercial entity's free speech.

The Final Ruling would require Global Premium Cigars to remove from market its 1502 brand and its trademarked packaging and advertising because it appeared after the predicate date. However, the suit is asserting that a company's trademarked and copyrighted intellectual property is protected under the Fifth Amendment as private property that cannot be seized by the government without just compensation. The plaintiff, believing that "no legitimate governmental objective is being satisfied by the use of the predicate date," claims that forcing the company to pull the brand, because of an arbitrary date, is in violation of the plaintiff's right to due process.

According to Herrera, the response from the premium cigar industry and consumers has been positive, with many pledging their support and providing donations to the cause. The plaintiff has already received financial support from cigar companies Leaf by Oscar and Falto Cigars. Enditem