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In re Application of Vapor Technology Association

Supreme Court, Albany County

January 8, 2020

In the Matter of the Application of Vapor Technology Association, BENEVOLENT ELIQUIDS, INC., and PERFECTION VAPES, INC., Petitioners,
v.
Andrew M. Cuomo, Governor of the State of New York, NEW YORK STATE DEPARTMENT OF HEALTH, HOWARD ZUCKER, M.D., Commissioner of the New York State Department of Health, THE PUBLIC HEALTH AND HEALTH PLANNING COUNCIL, and NEW YORK STATE POLICE, Respondents.

          THOMPSON HINE LLP (by Richard De Palma, Brian K. Steinwascher, Eric N. Heyer and Joseph A. Smith, Esqs.) Attorneys for Petitioners

          LETITIA JAMES Attorney General of the State of New York (by Assistant Attorneys General Keith J. Starlin and Andrew W. Koster) Attorneys for Respondents

          Catherine Cholakis Acting Supreme Court Justice

         This litigation is a combined CPLR Article 78 proceeding and declaratory judgment action. Petitioners seek, inter alia, to enjoin the enforcement of an emergency regulation adopted by respondent Public Health and Health Planning Council (the Council) at the request and with the approval of the Commissioner of the Department of Health, respondent Zucker (the Commissioner) pursuant to Public Health Law § 225(1) and (4). Before the Court at present is a motion by petitioners for a preliminary injunction against enforcement of the emergency regulation.

         Background

         The emergency regulation at issue, 10 NYCRR § 9-3, prohibits the manufacture, possession and sale of certain flavored "electronic liquids" in New York. "Electronic liquids" or "e-liquids" are liquids that are designed to be heated and converted to ærosol form in "electronic cigarettes" or "e-cigarettes." These handheld devices allow a user to inhale or "vape" the ærosol product.

         While "vaping" products have only been readily available in the United States for a little more than a decade, the frequency of their use has increased almost exponentially in recent years. E-liquids containing nicotine, for example, are vaped in lieu of smoking traditional cigarettes. This practice has become popular in part because there is evidence to suggest there are fewer health risks associated with vaping than with smoking. In addition, many believe that the transition from traditional cigarettes to vaping can assist smokers in breaking their dependence on nicotine.

         Not all e-liquids contain nicotine, of course, and many other compounds, such as THC, the active ingredient in marijuana, can be added to the glycol base. In addition, a seemingly limitless number of flavoring agents are available for incorporation into e-liquids. Fruit flavors, candy flavors and artificial "designer" flavors of e-liquids can be purchased. E-liquids are also available with tobacco flavoring and menthol flavoring, as are e-liquids with no flavoring additives at all.

         New York has seen a proliferation of manufacturers, distributors and retail sellers of e-liquids and other vaping products. Petitioners allege €” and respondents, at this stage of the litigation, do not deny that the vaping industry in New York has generated over a billion dollars in gross income in the past year. Unfortunately, however, despite the law prohibiting the sale of vaping products to individuals less than 21 years of age (prior to November 13, 2019, 18 years of age), an alarming number of underage youngsters in New York are vaping. Of grave concern is the fear that this practice will reverse the hard-won recent trend toward reduced nicotine addiction among our youth. It is widely believed that the vast array of fruit- and candy-flavored e-liquids are at the root of the attraction of vaping to the young.

         Recently, there have been a significant number of individuals hospitalized nationwide (and several dozen who have died) due to pulmonary illnesses attributed to vaping. The precise etiology of these illnesses has not been determined. There is some evidence tending to suggest that commercially available e-liquids are not the source of the noxious ingredient or ingredients responsible for these illnesses. The Center for Disease Control has found a potential connection between vitamin E acetate, a compound added to orally ingestible marijuana, and vaping-related lung disease. (Vitamin E acetate is not an ingredient in commercially available e-liquids, according to petitioners.) The investigation is ongoing, and there are certainly sound reasons for a government response to this evolving situation.

         On September 15, 2019, respondent Governor Andrew Cuomo announced that he was initiating executive action to ban the sale of flavored e-cigarettes and related products in New York (https://www.governor.ny.gov/news/governor-cuomo-announces-emergency-executive-action-ban-sale-flavored-e-cigarettes). The following day, the Commissioner and the Council announced their intent to promulgate emergency regulations to implement the ban. What followed was a single day of public comment and the immediate issuance of the emergency regulation at the heart of this litigation.

         Of particular significance in the emergency regulation is that the ban applies to flavored e-liquids regardless of "whether the liquid contains nicotine or not" (10 NYCRR § 9-2.1[b]). Additionally, the ban does not apply to e-liquids that are tobacco flavored, menthol flavored, or flavorless (§ 9-3.1[b]). It is also worth noting that, in its Regulatory Impact Statement, the Council wrote, "The alternative to the proposed regulation is to wait for the FDA to regulate in this area...," without any mention of legislation as an alternative to the proposed regulation.

         Shortly after the adoption of the emergency regulation, petitioners commenced the present litigation. Petitioner Vapor Technology Association (VTA) is a trade association comprised of some 800 member businesses in the vaping industry. Petitioner Benevolent Eliquids, Inc. (Benevolent) is a VTA member and a New York corporation engaged in the manufacture and distribution of e-liquids. Petitioner Perfection Vapes, Inc. (Perfection) is a New York corporation engaged in the retail sale of e-liquids.

         By Order to Show Cause dated September 27, 2019 (Connolly, AJSC), Supreme Court initially denied petitioner's application for a temporary restraining order (TRO). A TRO was later granted upon review by the Appellate Division, Third Judicial Department by Decision and Order dated October 3, 2019. This TRO remains in effect pending the determination of the present motion.

         Discussion

         As respondents' counsel correctly points out, the burden on a party seeking a preliminary injunction is a high one. Such relief is issued sparingly, (Kuttner v Cuomo, 147 A.D.2d 215, 218 [3d Dept 1989]), and only upon clear and convincing evidence in the record (County of Suffolk v Givens, 106 A.D.3d 943, 944 [2d Dept 2013], citing Apa Security, Inc. v Apa, 37 A.D.3d 502, 503 [2d Dept 2007]). [1] The three-part test applicable to motions for preliminary injunctions is a familiar one: first, will the moving party likely suffer irreparable harm if the preliminary injunction is not granted? Second, is there a likelihood of success on the merits of the petition? And finally, does a balancing of the equities favor the moving party? (see Doe v Axelrod, 73 N.Y.2d 748, 748 [1988], citing Grant Co. v Srogi, 52 N.Y.2d 596, 617 [1981]).

         Petitioners assert that the regulation at issue, if enforced, would render it impossible for their businesses to continue operation in New York. In support of this contention, petitioners have submitted affidavits of a number of vaping business owners which indicate that about 90% of the e-liquids they currently sell fall within the definition of the banned flavored products. By way of one example, the owner of one of VTA's member companies states, "Of the e-liquid products that we have distributed to vape shops in the state of New York since January 1, 2018, some 90 percent are products that would qualify as 'flavored e-liquid' under Section 9-3.1 of the emergency flavor ...


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