Office of the Secretary
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`UNITED STATES INTERNATIONAL TRADE COMMISSION
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`Washington, D.C. 20436
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`December 15, 2023
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`Harold H. Davis, Esq.
`Greenberg Traurig, LLP
`101 Second Street, Suite 2200
`San Francisco, CA 94105-3668
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`Re: Complaint Filed by R.J. Reynolds Tobacco Company and R.J. Reynolds
`Vapor Company Concerning Certain Disposable Vaporizer Devices and
`Components and Packaging Thereof (Docket No. 3700)
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`Dear Mr. Davis:
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`Under Commission Rules 210.9, 210.10 and 210.12(a)(2), (3) and (8), 19 C.F.R. §§
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`210.9, 210.10, 210.12(a)(2), (3) and (8), the Commission has determined to dismiss in part the
`complaint filed on behalf of R.J. Reynolds Tobacco Company and R.J. Reynolds Vapor
`Company (collectively “Reynolds”) and not institute an investigation concerning certain
`disposable vaporizer devices and components and packing thereof as to: (i) proposed respondent
`Shenzhen Pingray Technology (“Pingray”); (ii) the cause of action set out in paragraphs 120
`through 136 of the complaint (the “Authorization Claims”); and (iii) the cause of action set out in
`paragraphs 326 through 348 of the complaint.
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`Regarding Pingray, the information provided with the complaint, amendments,
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`supplements, and exhibits does not allege unfair acts in the importation into the United States or
`a sale of the accused articles by proposed respondent Pingray as required by the statute and the
`Commission’s rules.
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`Regarding the Authorization Claims cause of action set out in paragraphs 120 through
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`136 of the complaint, the Commission received a submission from the United States Food and
`Drug Administration (“FDA”) recommending against instituting on the basis that the
`Authorization Claims would usurp its enforcement authority under the Food, Drug, and Cosmetic
`Act (“FDCA”) and amount to a private right of action precluded by the FDCA. See FDA Letter
`from Mark Raza and Peter Dickos, EDIS Doc. ID 807175 at 1 (Oct. 27, 2023) (“FDA Letter”).
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`As explained below, the Commission agrees with the FDA and finds that the Authorization
`Claims do not allege an unfair method of competition or an unfair act cognizable under 19
`U.S.C. § 1337(a)(1)(A) (“Section 337”).
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`Reynolds’ Authorization Claims allege that each of the proposed respondents have
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`violated the Lanham Act by making public statements falsely representing that their accused
`disposable vaping devices are FDA authorized or “allowed” for sale in the United States.
`Complaint, ¶¶ 120-136. Reynolds claims that proposed respondents’ accused disposable vaping
`devices lack marketing authorization from FDA and they do not have a timely filed premarket
`tobacco product application pending with FDA, or a marketing denial order that has been stayed
`by FDA or a court. Complaint ¶ 121; Nov. 29, 2023 Reynolds letter, EDIS ID No. 809498. The
`only specific statement Reynolds identifies as purporting to show a false representation of FDA
`authorization is the package statement, “Sale Only Allowed in the United States.” Complaint ¶
`126; Exhibit 3.
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`The FDA explains that the identified statement – “Sale Only Allowed in the United
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`States” – must be included verbatim on the labels of all tobacco products (both authorized and
`unauthorized) sold in the United States pursuant to the FDCA, 21 U.S.C. § 387t(a). FDA Letter
`at 4 (explaining that a tobacco product in package form is “misbranded” if its label does not
`include such a statement). Further, the FDA states that “nearly every ENDS [electronic nicotine
`delivery systems] product now on the market (including at least one of Complainants’ own) lacks
`FDA authorization, and thus is not lawful.” Id. However, the FDA has decided as a policy
`matter against immediate enforcement against unauthorized ENDS products already on the
`market on the basis of striking a balance between the serious risk that e-cigarettes pose and their
`potential benefit in helping smokers transition from or significantly reduce smoking combustible
`cigarettes. Id. at 2. Given that the label at issue must be included on all tobacco products, FDA
`states that Reynolds’ “theory would convert every FDCA-unauthorized product into a Lanham
`Act-violating product . . . boil[ing] down to an impermissible attempt to weaponize the Lanham
`Act to do indirectly what Complainants cannot do directly: enforce the FDCA’s premarket
`authorization requirement.” Id. at 4. Moreover, Respondents have pointed out that they are not
`aware of any domestic production of ENDS products. See, e.g., Magellan et. al PI Sub. at 5 (Oct.
`27, 2023) (“Respondents are unaware of any such articles made in the United States… As
`Complainants note, almost all vape products, including those sold by Complainants, are
`produced in China.”).
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`Congress gave the FDA the authority to enforce the FDCA and prohibited private parties
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`from bringing such actions. See 21 U.S.C. § 337(a) (“all such proceedings for the enforcement,
`or to restrain violations, of [the FDCA] shall be by and in the name of the United States”); see
`also POM Wonderful LLC v. Coca-Cola Co., 573 U.S. 102, 109 (2014)) (“the FDCA and its
`regulations provide the United States with nearly exclusive enforcement authority. . . . Private
`parties may not bring enforcement suits.”); Amarin Pharma, Inc. v. Int’l Trade Comm’n, 923
`F.3d 959, 966 (Fed. Cir. 2019) (“Private parties may not bring suits to enforce the FDCA.”). If
`the Commission were to find the “Sale Only Allowed in the United States” statement to be
`misleading and therefore a violation of Section 337, it would effectively be a decision that nearly
`all disposable vaporizer devices could be subject to exclusion from importation. But the decision
`of whether to exclude unauthorized ENDS products from the market is a determination that is
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`2
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`squarely within the authority of the FDA, and it would usurp the FDA’s authority to enforce the
`FDCA and impermissibly grant a private right of action to enforce the FDCA if the Commission
`were to institute an investigation based on the Reynolds complaint to resolve whether the
`accused products are not “allowed” and should be excluded from the market. Reynolds’
`Authorization Claims are therefore precluded by the FDCA. See Amarin, 923 F.3d at 968-69
`(affirming the Commission’s decision not to institute a Lanham Act claim that was “based solely
`on alleged violations of the FDCA’s requirements”); see also Mylan Labs., Inc. v. Matkari, 7
`F.3d 1130, 1139 (4th Cir. 1993) (“permitting Mylan to proceed on the theory that the defendants
`violated § 43(a) merely by placing their drugs on the market [“with standard package inserts
`often used for FDA-approved drugs”] would, in effect, permit Mylan to use the Lanham Act as a
`vehicle by which to enforce the [FDCA] and the regulations promulgated thereunder.”).
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`Any suggestion that the Commission could institute and then consider the FDA’s policy
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`reasons for non-enforcement as part of its analysis of the public interest factors in connection
`with the Commission’s remedy determination does not cure the preclusion issue related to the
`Authorization Claims. The public interest factors set forth in Section 337 are statutory criteria
`that the Commission considers in connection with its remedy determination upon finding a
`section 337 violation that may indicate that “articles should not be excluded from entry.” See 19
`U.S.C. § 1337(d)(1), (f)(1), (g)(1). The Commission is required to issue remedial relief upon the
`finding of a Section 337 violation unless “the effect of [the] exclusion [or cease and desist order]
`upon” the statutorily-enumerated public interest factors counsel otherwise. Thus, were the
`Commission to find a violation of section 337 based on Reynolds’ Authorization Claims, it
`would be required to consider whether the accused ENDS products should not be excluded from
`entry based inter alia on whether it would be contrary to public health to do so. In that situation,
`the Commission would be asked to “step into the shoes of the FDA,” FDA letter at 5, and decide
`whether unauthorized ENDS products should be excluded from the market. The FDCA
`precludes such action, however. Consistent with its statutory mandate, FDA is the authority that
`is to apply its expertise to determine the appropriate circumstances to enforce the FDCA.
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`Similarly, as to the cause of action set out in paragraphs 326 through 348 of the
`complaint, which alleges a violation of Section 337 based on unfair competition and unfair acts
`through violations of Customs laws and regulations, the Commission finds that this claim does
`not allege an unfair method of competition or an unfair act cognizable under Section 337 as
`required by the statute and the Commission’s rules. As U.S. Customs and Border Protection
`explains in its submission: “In order to evaluate this claim on the merits, the Commission would
`necessarily have to determine the appropriate classification and duty rate for such merchandise.
`However, as identified above, Congress statutorily granted this authority to the Department of
`the Treasury and to CBP as the agency responsible for fixing the final classification and rate of
`duty applicable to imported merchandise.” CBP Sub. at 3. CBP’s submission further notes that
`enforcement of the Customs laws is within the province of CBP’s authority and there is no
`private right of action to enforce the Customs laws. Id. at 4-5. The Commission agrees with the
`issues raised by CBP as to the Customs claims in the Reynolds complaint.
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`The Commission, however, has determined to institute an investigation with respect to
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`the remaining respondents based on the complaint’s false advertising claim under the Lanham
`Act, 15 U.S.C. § 1125(a)(1)(B), stated in paragraphs 137 through 142 of the complaint. The
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`Commission has also determined to institute an investigation with respect to the remaining
`respondents based on the complaint’s false designation of origin claim under the Lanham Act, 15
`U.S.C. § 1125(a)(1)(A), stated in paragraphs 143 through 147 of the complaint. At this stage, it
`does not appear that those Lanham Act allegations are precluded by the FDCA. The
`Commission also determined to institute an investigation with respect to the remaining
`respondents based on the complaint’s unfair competition claim based on violations of the Prevent
`All Cigarette Trafficking (PACT) Act.
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`Documents relating to this institution determination, including comments from the
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`complainants, proposed respondents, and the public, can be found on the Commission’s
`Electronic Document Information System (EDIS) under Docket Number 3700.
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`Sincerely,
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`cc: Proposed respondents
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`Lisa R. Barton
`Secretary to the Commission
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`4
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` Inv. No. 337-TA-1381
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`CERTAIN DISPOSABLE VAPORIZER DEVICES AND
`COMPONENTS AND PACKAGING THEREOF
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`PUBLIC CERTIFICATE OF SERVICE
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`I, Lisa R. Barton, hereby certify that the attached INSTITUTION OF
`INVESTIGATION has been served via EDIS upon the Commission Investigative Attorney,
`Cortney Hoecherl, and upon the following parties as indicated, on December 15, 2023.
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`Lisa R. Barton, Secretary
`U.S. International Trade Commission
`500 E Street, SW, Room 112
`Washington, DC 20436
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`On Behalf of Complainants R.J. Reynolds Tobacco Company
`and R.J. Reynolds Vapor Company:
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`Harold H. Davis
`Greenberg Traurig LLP
`101 Second Street
`San Francisco, CA 94105
`Email: hal.davis@gtlaw.com
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`Respondents:
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`Affiliated Imports, LLC
`13326 Immanuel Road
`Pflugerville, TX 78660-8006
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Email Notification
`of Availability for Download
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`
`
`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`American Vape Company, LLC a/k/a American
`Vapor Company, LLC
`13326 Immanuel Road
`Pflugerville, TX 78660-8006
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`Breeze Smoke, LLC
`4654 Lilly Court
`West Bloomfield, MI 48323
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`CERTAIN DISPOSABLE VAPORIZER DEVICES AND
`COMPONENTS AND PACKAGING THEREOF
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` Inv. No. 337-TA-1381
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`Certificate of Service – Page 2
`Dongguan (Shenzhen) Shikai Technology Co., Ltd.
`L5 Block A Shuangjinhui, Tongfuyu Fuyong,
`Baoan Shenzhen, Guangdong China 518101
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`EVO Brands, LLC
`251 Little Falls Drive
`Wilmington, DE 19808
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`Flawless Vape Shop Inc.
`1021 E. Orangethorpe Avenue
`Anaheim, CA 92801
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`Flawless Vape Wholesale & Distribution Inc.
`1021 E. Orangethorpe Avenue
`Anaheim, CA 92801
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`Guangdong Qisitech Co., Ltd.
`Fuxing Road, Changan Town, Room 201,
`Building 3, No. 36, Dongguan City,
`Guangdong Province, China 523000
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`iMiracle (Shenzhen) Technology Co. Ltd.
`Room 1203, Block 1, Wanting Building,
`Xixiang Substrict, Bao’an District,
`Shenzhen China 518126
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`Magellan Technology Inc.
`2225 Kenmore Avenue
`Buffalo, NY 14207
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
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`CERTAIN DISPOSABLE VAPORIZER DEVICES AND
`COMPONENTS AND PACKAGING THEREOF
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` Inv. No. 337-TA-1381
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`Certificate of Service – Page 3
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`Pastel Cartel, LLC
`13326 Immanuel Road
`Pflugerville, TX 78660-8006
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`Price Point Distributors Inc. d/b/a Prince Point NY
`500 Smith Street
`Farmingdale, NY 11735
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`PVG2, LLC
`251 Little Falls Drive
`Wilmington, DE 19808
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`Shenzhen Daosen Vaping Technology Co., Ltd.
`#501, Building B1, Quanzhi Zhihui Park,
`Ligang S. Road., Shajin Street, Bao’an Dist.,
`Shenzhen, China 518104
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`Shenzhen Fumot Technology Co., Ltd.
`A2907, Building A Longguan Jiuzuan Business Center
`Minzhi Longhua, Shenzhen, China 518000
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`Shenzhen Funyin Electronic Co., Ltd.
`205 and 401, Building A3, Fuyan Ind. Zone
`Tangwei Community, Fuhai St., Bao’an Dist.
`Shenzhen, Guangdong, China 518000
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`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`CERTAIN DISPOSABLE VAPORIZER DEVICES AND
`COMPONENTS AND PACKAGING THEREOF
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` Inv. No. 337-TA-1381
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`Certificate of Service – Page 4
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`Shenzhen Han Technology Co., Ltd.
`Qianwan Hard Technology Park, Baoan
`District, Shenzhen, Guangdong,
`China 518126
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`Shenzhen Innokin Technology Co., Ltd.
`Building 6, XinXinTian Industrial Park, Xinsha
`Road, Shajing, Baoan District,
`Shenzhen China 518104
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`Shenzhen IVPS Technology Co., Ltd.
`101 Building B8, No. 2, Cengayo Industrial
`Area, Yuluv Community, Yutang Subdistrict,
`Guangming District,
`Shenzhen, Guangdong, China 518001
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`Shenzhen Noriyang Technology Co., Ltd.
`Room 303, Building A, Zhonghengsheng HighTech Park, Xinyu
`Road, Shajing Town, Baoan District,
`Shenzhen, Guangdong Province, China 518104
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`Shenzhen Weiboli Technology Co. Ltd.
`Room 312, Tianshuzuo, No. 6099 Bao’an
`Avenue, Bao’an District,
`Shenzhen, China 518000
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`SV3 LLC d/b/a Mi-One Brands
`4908 E. McDowell Road
`Phoenix, AZ 85008
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`CERTAIN DISPOSABLE VAPORIZER DEVICES AND
`COMPONENTS AND PACKAGING THEREOF
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` Inv. No. 337-TA-1381
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`Certificate of Service – Page 5
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`Thesy, LLC d/b/a Element Vape
`10620 Hickson Street
`El Monte, CA 91731
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`Vapeonly Technology Co. Ltd.
`Room 306-311, Tianshu Building, No. 6099,
`Bao’an Avenue, Bao’an District,
`Shenzhen, China 518000
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`VICA Trading Inc. d/b/a Vapesourcing
`3045 Edinger Avenue
`Tustin, CA 92780
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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`☐ Via Hand Delivery
`☐ Via Express Delivery
`☐ Via First Class Mail
`☒ Other: Service to Be
`Completed by Complainant
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