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With the growing popularity ofe-cigarettes, federal, state,and local regulators are

increasingly restricting the use and saleof these products, and new regulatoryrestrictions are continually beingannounced. One trade association hasreported that e-cigarette makers havebeen able to capture approximately 14percent of the 44 million tobacco usersin the United States, and this market isexpected to grow further.

WHAT EXACTLY ARE E-CIGARETTES? Short for “electronic cigarettes,” e-cigarettes are essentially electronicnicotine delivery systems; they are mostoften shaped like cigarettes—althoughoccasionally like cigars or pipes—and aredesigned to deliver nicotine to a user inthe form of a vapor. Generally, an e-cigarette consists of a lithium battery-powered heating element and replace-able cartridges that contain nicotine orother chemicals, and an atomizer that,when heated, converts the contents ofthe cartridge into a vapor that a userinhales. E-cigarettes are considered to benon-combustible, given that they emit avapor rather than smoke.

Sometimes, they can be legally usedwhere traditional tobacco products arebanned, and various physician groupshave defended the product, based ontheir opinion that e-cigarettes delivernicotine without the combustion, tar,and numerous other chemicals found inregular cigarettes.

FEDERAL CHALLENGES TO E-CIGSThe Food and Drug Administration(“FDA”) has, however, expressedconcern about the lack of clinical studieson the potential health risks posed by e-

cigarettes and the way these productsare sometimes marketed without healthwarnings or age restrictions. Notably,between 2008 and 2010, the FDA made adetermination that certain e-cigaretteswere unapproved combination drug/device products. Based on thisdetermination, the FDA detained andeffectively prevented the e-cigarettesmade by several companies from beingimported. One company challenged thatdetermination in court.

The U.S. Court of Appeals for theD.C. Circuit, in Sottera, Inc. v. Food &Drug Administration, issued a decision

which discussed the regulatory class-ification of e-cigarettes and otherproducts “made or derived fromtobacco” and the jurisdictional line thatshould be drawn between “tobaccoproducts” and “drugs,” “devices,” andcombination products, as those termsare defined by relevant laws. The courtheld that e-cigarettes and other productsmade or derived from tobacco should beregulated as “tobacco products,” andwere accordingly not drugs/devicesunless they are marketed for therapeuticpurposes. The federal governmentdecided not to seek further review of thisdecision, and the FDA is complying withthe jurisdictional lines established bySottera. Notwithstanding, the FDA hasrecently indicated its intention to issueregulations covering e-cigarettes. Thus,any manufacturer, distributor or retailerof e-cigarettes must keep abreast of anyof the FDA’s proposed enactmentsrelating to e-cigarettes to ensure theyunderstand how any changes affect thesale, distribution, and use of e-cigarettes.

REGULATION FOCUS>Lawmakers Continue E-Cig Regulatory OnslaughtRight from the gate, e-cigarettes have defied categorization. Variousjurisdictions nationwide are approaching the innovative products witha wide ranges of sales restrictions. >BY BRYAN M. HAYNES

>The e-cigarette category is experiencing tremendous growth, both in terms of sales volume,and in brand proliferation. Pioneered by small startups, the market has now been joined by allthree of the largest cigarette manufacturers. Specialty tobacco importer and brand developerKretek Imports, Moorpark, Calif., has developed EZ Cig (above), as well as Cig2o entries.

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STATE, LOCAL REGULATORY ENACT-MENTS AFFECTING E-CIGARETTESStates and localities have been increas-ingly enacting regulatory limitations onboth the sale and use of e-cigarettes.Various state attorneys general have alsobrought lawsuits alleging that e-cigarettedistributors have violated state law byselling to minors or making unsub-stantiated health claims. Several of thestate and local regulatory restrictions andadministrative pronouncements relatedto e-cigarettes include:

Arizona: State law prohibits minors frombuying or possessing e-cigarettes.

California: State law prohibits the sale of e-cigarettes to minors.

Colorado: E-cigarettes have been classifiedas a tobacco product by Colorado law,and thus the sale and use of e-cigarettesby minors is is prohibited.

Connecticut: State law prohibits the use ofe-cigarettes by minors. A bill to regulate

smoking of e-cigarettes in certain publicplaces was introduced in 2013, but hasnot passed.

Kentucky: Legislation, which has not yetpassed, was introduced in 2013 toregulate smoking of e-cigarettes indoors;however, local bans of indoor smoking ofe-cigarettes are already in effect in Bullittand Madison Counties.

Massachusetts: Local ordinances in affectin South Hadley, North Attleboro, andSomerset restrict the indoor use ofelectronic cigarettes as well as their saleto minors.

Minnesota: State laws regulate and tax thesale of e-cigarettes and impose criminalpenalties for their sale to minors.

Missouri: State law bans e-cigarette use,except in private homes, vehicles, andsome hotel rooms.

New Hampshire: State law prohibits thesale of e-cigarettes and liquid nicotine to

minors and prohibits the distribution offree samples of such products in a publicplace. The use of such products is alsoprohibited on the grounds of any publiceducational facility.

New Jersey: State laws prohibit the use ofelectronic smoking devices in all enclosedindoor places of public access as well asin workplaces.

New York: Local ordinances in Cattar-augus County ban e-cigarette sales tominors and prohibit the use of e-cigarettesin public places and workplaces. SuffolkCounty has similarly enacted anordinance which prohibits the sale of e-cigarettes to minors and which prohibits“the use of e-cigarettes and like productsin public places where traditional forms ofsmoking are already disallowed.”

Oregon: An agreement was reachedbetween the Attorney General and an e-cigarette manufacturer prohibiting thesale and distribution of manufacturer’selectronic cigarettes in Oregon.

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Utah: State laws regulate the sale, gifting,and distribution of e-cigarettes by manu-facturers, wholesalers, and retailers.

Virginia: The attorney general issued anofficial opinion that e-cigarette use does

not fall within the definition of “smoking”for purposes of the Virginia law thatprohibits smoking in a variety of locations,including elevators, public school buses,and the interior of public elementary,intermediate and secondary schools.

Washington: Local ordinances in KingCounty (which includes Seattle) ban theuse of e-cigarettes in all public places.

Given the growing debate regardinge-cigarettes, legislation that seeks to taxand regulate the sale and use of e-cigarettes is predicted to be introducedand enacted in an ever-increasingnumber of jurisdictions in the future.Manufacturers, distributors, and retailersof e-cigarettes must carefully monitor thelaws at the federal, state, and local levelsto ensure that they are in compliance.Many laws impose substantial mon-etary—and in some cases even criminal—penalties for violations. As the categorycontinues to grow, detractors mobilize,often ignoring the inherent differencesfrom combustable tobacco.

Troutman Sanders Tobacco Team,Troutman Sanders LLP, 1001 HaxallPoint, Richmond, Va. 23219, Tel: (804)697-2206, Fax: (804) 697-1339, Web:www.troutmansanders.com, Email:bryan.haynes@troutmansanders.com.

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New York City Targets E-Cigs with “Defacto Ban”Despite a May 2, 2013 meeting of the New York City Committee on Health, dur-ing which a representative from the NYC Department of Health & MentalHygiene stated that the department had no intention of trying to regulate e-ciga-rettes, drafts of three tobacco bills were leaked in August showing that MayorMichael Bloomberg’s administration was working to explicitly categorize electron-ic cigarettes as tobacco products and enact a sweeping ban on flavored e-cigs.

One of the bills would raise the legal age to purchase all tobacco products to21, while another would prohibit the display of any cigarette advertising in stores.A third bill would prohibit the use of tobacco coupons, create a $10.50 price floorfor cigarette packs, and increase the fines against those selling illegal cigarettes.Initially the bills, drafted by the Health Department and introduced into theCouncil at the request of Mayor Bloomberg, didn’t reveal the city’s position onelectronic cigarettes. Menthol and “tobacco flavored” appear to remainunregulated under the bills, but the sale of flavored e-cigs would be relegated tonearly extinct “tobacco bars,” resulting in a defacto ban, says Dr. Michael Siegel, aprofessor of Community Health Sciences at the Boston University School of PublicHealth and a supporter of electronic cigarettes as a lower risk smoking alternative.