Tobacco
Tobacco Law Blog
Troutman Sanders' Tobacco Law Blog offers timely updates regarding the tobacco industry to inform you of recent changes in the law, upcoming regulatory deadlines and significant judicial opinions that may impact your business. Click
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The Troutman Sanders Tobacco Team consists of partners, attorneys, of counsel and associates. The Team includes a former state Attorney General and Deputy Attorney General who have the "inside" experience, legal skills and business savvy to best service our tobacco clients in particular. Most team members have experience as former state Assistant Attorneys General. The Tobacco Team works closely together and with clients to develop business strategies; to maneuver through the complicated regulatory process; and to handle branding, transactional and litigation matters.
Federal Law
Congress has recently passed legislation which authorizes the regulation of tobacco products by the FDA. Our attorneys within our Life Sciences Team and Tobacco Team work with clients to assist them with formulating plans for meeting the new requirements of the FDA, which regulate the manufacture, packaging and sale of tobacco products in the US. They advise on and apply for tobacco producer permits from the Alcohol, Tobacco, Tax & Trade Bureau (“TTB”) and advise regarding federal excise tax. They file label statement rotation plans with FTC under the Federal Cigarette Labeling and Advertising Act, and Ingredient Lists with the US Department of Health and Human Services (CDC). Additionally, they advise clients concerning the PACT Act, the Tobacco Transition Payment Program (Tobacco Buyout), Contraband Cigarette Trafficking Act and importation requirements.
State Law
The tobacco industry changed forever after the states and four original participating manufacturers signed the Master Settlement Agreement (MSA) in 1998. As a result, tobacco manufacturers, importers or related tobacco distributors manufacturers, wholesalers, brand owners face a host of regulatory hurdles that impact their business operation and finances. The Troutman Sanders Tobacco Team regularly advises these companies on the various states' regulations governing licenses and permits, escrow payments and on the establishment of qualified escrow agreements. We also assist these companies in determining methodologies to minimize escrow payments to the states while remaining compliant with state laws and regulations. This includes the voluminous complementary statutes intended to provide states with certain enforcement tools.
In addition, many states have enacted statutes or promulgated regulations that require certain manufacturers to submit quarterly reports of sales, quarterly escrow payments and certain distributor reports, which, unless closely monitored, could result in the tobacco company being placed on the states' non-compliant list. Placement on such a list results in the tobacco manufacturer's product being deemed contraband and subject to seizure by the state. Our Team works closely with tobacco manufacturers to develop reporting systems so states receive the required information in a timely manner and in the proper form, thereby allowing the manufacturer to focus on real business issues.
Four states (Florida, Minnesota, Mississippi and Texas) did not sign the MSA, and our attorneys assist tobacco manufacturers, distributors, wholesalers and brand owners with licensing and related issues in the non-MSA states. Our Regulatory Compliance and Government Litigation practice group has extensive experience in representing clients in single and multi-state State Attorney General investigations and litigation.
Disputes - Civil & Criminal
Our tobacco regulatory attorneys handle civil and criminal disputes with federal and state agencies concerning manufacturing, import and export permits and payment of excise taxes, state business, wholesale dealer and other licenses and listings to sell product on state tobacco directories. The tobacco team regularly counsels distributors, wholesalers and manufacturers, as well as others involved in all aspects of cigarette production and distribution, in matters against the large tobacco companies (Philip Morris, RJ Reynolds and Lorillard) concerning, among other things, (i) retail buyers programs; (ii) wholesale partners programs; (iii) buy-down discount disputes; and, (iv) various contractual issues.
Intellectual Property
Brand protection is most important in the cigarette business, and our Team has added value in this area by analyzing registrability, securing registration of foreign and domestic trademarks, and securing registration of copyrights. We know how important it is that trademarks be licensed in writing and their use monitored for proper quality control in order to avoid abandonment of trademark rights. Our Team performs all necessary tasks to protect, police and enforce trademark and copyrights, including intellectual property audits. We are well-versed in sweepstakes and promotions, as well as Web site requirements, which are popular with businesses of all types.
Commercial Litigation
When litigation arises, it is a distraction for corporate management and an interruption of the company's true business. The litigators on our Tobacco Team are skilled and equipped to successfully represent cigarette manufacturers in matters ranging from multi-district and class action litigation to commercial disputes in state and federal trial courts. They have experience representing clients in litigation concerning trademark, corporate, employment, finance and products liability matters. More importantly, they understand the business needs of our tobacco manufacturing clients and make a real goal to avoid litigation when possible.
Business and Commercial Law, Domestic and International
Members of our Team have experience in corporate and transactional work both in the U.S. and abroad. They assist in the formation, acquisition, merger and sale of corporate entities and in the purchase and sale of corporate assets. In particular, they advise cigarette manufacturers on a daily basis in the review, drafting and negotiation of business operating agreements including financing, supply, sales, technology license, distributor, broker, cigarette manufacturing and other related agreements.
Labor, Employment, Occupational Health and Safety
The most important business asset are the people. We regularly advise cigarette manufacturers regarding employment and related health and safety issues. Our Team is able to provide guidance throughout the process of considering employment agreements, confidentiality and non-competition policies, retirement and health benefit plans, and related matters pertaining to use of contractors.