In early January, the U.S. Court of Appeals for the Fifth Circuit, sitting en banc in Wages & White Lion Investments, L.L.C. v. U.S. Food & Drug Administration, held that the U.S. Food and Drug Administration’s (FDA) marketing denial order (MDO) of petitioner’s premarket tobacco applications (PMTAs) violated the Administrative Procedure Act (APA).

In October 2021, a Fifth Circuit panel in the same case issued a stay of FDA’s enforcement against electronic nicotine delivery system (ENDS) products, reasoning that FDA likely violated the APA with its MDO. The recent en banc ruling reverses the court’s July 2022 decision on the merits, which departed from the earlier panel and ruled for FDA. The full Fifth Circuit ultimately found that FDA’s inconsistent guidance on the PMTA process for flavored ENDS products was arbitrary and capricious. In particular, the court found that FDA failed to give flavored ENDS product manufacturers sufficient notice of the rules by which PMTAs would be evaluated.

The court considered numerous instances in which FDA guidance and public statements suggested requirements for flavored ENDS products that differed upon actual PMTA review. For example, the agency indicated that it would consider applicants’ marketing plans and that long-term studies were not required. Reversing course in its review, FDA refused to consider marketing plans. Further, it denied applications on a new, previously unannounced basis: applications lacked sufficiently robust evidence showing that flavored ENDS products could facilitate smoking cessation or reduction better than tobacco variants. The court additionally found that FDA failed to explain its change in position regarding PMTA requirements — disregarding manufacturers’ reasonable interest in relying on prior guidance.

This en banc ruling further solidifies the growing circuit split on the issue of MDOs for flavored ENDS products. In 2022, the Eleventh Circuit ruled similarly, finding that FDA’s failure to consider marketing and sales-access-restriction plans during the PMTA process was arbitrary and capricious. Conversely, other circuits have ruled for FDA on these issues.

It is unclear at this juncture whether the federal government will seek review of the Fifth Circuit’s decision at the U.S. Supreme Court. Just last year, the high court declined to hear an appeal of the Fourth Circuit’s decision on these issues in Avail Vapor, LLC v. U.S. Food & Drug Administration. As the circuit split grows, however, pressure may be building for the Supreme Court to weigh in. This is evidenced by a recent petition for review of the Second Circuit’s decision in Magellan Technology, Inc. v. U.S. Food & Drug Administration. The Court could also soon receive a petition arising from the Ninth Circuit’s decision in Lotus Vaping Technologies, LLC v. U.S. Food & Drug Administration. There, the Court has granted Lotus Vaping’s request for an extension of time in which to file a petition. In the meantime, we will continue to monitor the resolution of flavored ENDS product MDO challenges in the federal courts.