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California Federal Judge Dismissed Most All of False Advertising Class Action Against E Cig Manufacturers

Federal Preemption of State Law

Federal Preemption of State Law

A California Federal Judge dismissed most all of of the false advertising class action against e cig manufacturers in the federal case of In Re Fontem US, Inc. Consumer Class Action Litigation.  Click here to read the lawsuit. The case involves a proposed class action lawsuit against numerous e cigarette manufacturers, including Blu E Cigs, of failing to warn consumers of the dangers of their products.  The lawsuit alleged:

  • “This Complaint seeks to remedy Defendants’ deceptive and unfair sales of Blu electronic cigarettes in California. Consumers of the Products are exposed to significant amounts of harmful carcinogens when using the Products as directed. Yet, Defendants not only fail to warn consumers of such cancer-causing chemicals, but they utterly fail to disclose the presence of such chemicals.”
  • “Under California law, companies exposing individuals to cancer-causing chemicals are required to warn those individuals regarding this exposure. Defendants’ failure to provide the legally required cancer warnings for the Products constitutes a material omission that is likely to deceive ordinary consumers.”
  • “Material omissions in the face of a legal obligation to disclose constitute unfair competition in violation of California’s Unfair Competition Law, Bus. & Prof. Code § 17200, et seq. and the California Consumers Legal Remedies Act Civ. Code § 1750, et seq.”

The California federal judge found that all claims, but one state law claim (prop 65), were preempted by recent U.S.Food and Drug Administration “deeming regulations” that went into effect August 8, 2016.  This new law now regulates the entire e cig industry in the U.S.

The Court’s ruling is below:

TENTATIVE Order re Motion to Dismiss

In the Second Consolidated Amended Complaint (“SCAC”), Plaintiffs Larry Diek, Frank Perez, Michael Whitney, Paul Pisciotto, and Tanya Mullins (collectively, “Plaintiffs”) purport to bring causes of action under the laws of California, Illinois, and New York on behalf of themselves and similarly situated consumers against Defendants LOEC, Inc., Lorillard, Inc., Reynolds American, Inc.; ITG Brands, LLC; Fontem US, Inc.; and Fontem Holdings 4 B.V. (collectively, “Defendants”). (See generally SCAC, Docket (“Dkt.”) No. 71.)

On July 1, 2016, pursuant to Federal Rule of Civil Procedure 12(b)(6), Defendants filed this motion to dismiss the SCAC on grounds that the Plaintiffs’ claims are expressly preempted by a recent final rule promulgated by the Food and Drug Administration (“FDA”). (Mot., Dkt. No. 74.) Plaintiffs oppose. (Opp’n,Dkt. No. 80.) Defendants replied (Reply, Dkt. No. 81.)

. . .

For the foregoing reasons, the Court concludes that Plaintiffs’ claims, with the exception of the claim for violation of the UCL by virtue of violation of Proposition 65, are preempted by the Final Rule and the TCA. The Court dismisses counts 1–3 and 5–7 with prejudice. The Court does not dismiss count 4.

The Court does not reach the arguments pertaining to the Illinois state law claims because the Court finds these claims are preempted.

Click here to read entire Court Opinion