7th Circuit opinion shapes overhaul of vaping law

Back to TopCommentsE-mailPrintBookmark and Share

Guidance from the 7th Circuit Court of Appeals was the driving force behind an overhaul of Indiana’s controversial vaping law, which is now before the House of Representatives in a significantly amended form.

head-randy-mug.jpg Head

After a panel of the 7th Circuit in January struck down several of Indiana’s “astoundingly specific” regulations on out-of-state e-liquids manufacturing — including 24-hour video monitoring, clean room requirements and an audit provision — on the basis of a violation of the dormant Commerce Clause in the U.S. Constitution, Sen. Randy Head, R-Logansport, said the General Assembly was forced to start over on its planned revamp of the state’s vaping law.

Soon after its passage in 2015, the Vapor Pens and E-Liquid Act quickly fell prey to widespread controversy, particularly with regard to its stringent security requirements. According to the 7th Circuit and public opinion, the security requirements seemed to be designed to favor one particular security firm — Lafayette-based Mulhaupt’s, the only firm that could meet the requirements.

Legislators were already working on amending the law to ease those concerns when the 7th Circuit opinion came down, timing that Head said was unusual but ideal.

“We still had time to make it right,” he said.

In its current form, Senate Bill 1 strips most of the security provisions and instead leaves in place requirements for ingredient labeling, child-proof caps, tamper resistant/evident packaging and lot numbers that can trace where e-liquids products were manufactured if they are found to be adulterated. Additionally, the bill provides that current manufacturers permitted to work in Indiana — seven in all — can continue their operations.

Provisions such as specific labels would remain permissible under the circuit court opinion because they represent only “minor changes” to the manufacturing process, Head said. In its opinion, the 7th Circuit pointed to cases such as National Electrical Manufacturers Association v. Sorrell, 272 F.3d 104 (2d Cir. 2001) and International Dairy Foods Association v. Boggs, 622 F.3d 628, 647-49 (6th Cir. 2010) as precedent for that part of its ruling.

But by stripping out the other requirements called into question by the public, vape shop owners and the 7th Circuit, Head said the General Assembly is attempting to create a level playing field for both in-state and out-of-state manufacturers.

Under the 7th Circuit’s opinion, Indiana would be permitted to impose its stringent regulations on in-state manufacturers, but not on out-of-state companies that would ship their products to be sold in Indiana. However, imposing the strict regulations only in the Hoosier state would create a two-tier system in which manufacturers would be tempted to produce e-liquids out-of-state while still selling them in Indiana, thus hindering the Hoosier economy by driving away jobs, Head said.

That’s similar to what happened with Cool Breeze Vapors, an Evansville-based operation that was forced to move into Kentucky because Mulhaupt’s would not give it a license. Chris Brown, owner of Cool Breeze Vapors, said under the new language of the law, he and his employees can now return to Evansville to continue their work.

But Mike Leppert, a lobbyist with Krieg DeVault LLP who lobbies on behalf of Turning Point Brands, formerly the National Tobacco Co., said there was no reason for Indiana to pass a law that would have driven out Brown’s business in the first place.

eliquids-table“I look at the market as an American market, not 50 separate markets,” Leppert said. “Cool Breeze has a presence in three states. It’s an Indiana company, an Indiana family, and there’s no reason for their company to have to treat Indiana as if it’s some sort of black hole.”

When asked if he thought the repeal of many of the requirements, such as the clean room and security specifications, was unfair to the seven current Indiana permittees who had invested their resources into meeting those specifications, Head said he thought the vaping laws in Indiana had been unfair to all parties at one time or another.

“We could keep those rules just if you exist in the state of Indiana, and all the other manufacturers could just go right across the border and still be allowed to manufacture,” he said. “So we’ve got to deal with this court ruling as it exists.”

taylor-greg-mug.jpg Taylor

Senate Bill 1 found overwhelming support at both the committee and Senate floor level with one exception — Sen. Greg Taylor, D-Indianapolis. While Taylor agreed with stripping out the security company requirements, he expressed concern about the lack of regulation on where e-liquid products can be manufactured throughout Indiana.

A former vaper himself, Taylor said he would often buy e-cigarettes from corner shops, but didn’t realize that the liquids used in the e-cigarette could be manufactured in-house by those shop owners. But as he learned more about the e-liquids manufacturing process, Taylor said he became concerned about the lack of regulation.

While provisions such as child-proof caps and tamper-evident packaging are positive safeguards once a vaping product has been made and sold, Taylor said even those requirements would not be enough to protect a vaper if the process of manufacturing the e-liquids was not properly monitored. Until the federal government comes out with more specific requirements for the e-liquids industry, he said he would be in favor of stronger regulations of who can sell vaping products in Indiana.

But Leppert said such concerns are largely fiction and noted that no regulatory scheme would deter a person who is intentionally seeking to adulterate e-liquids products.

“The bill that was passed in 2015 and modified in 2016 was not a panacea for safety, and those who claim that it is are just misleading the public,” Leppert said.

Leppert further noted that because he has a client base of both out-of-state manufacturers and those who plan to open Indiana e-liquids facilities, he was pleased to see the 7th Circuit opinion differentiate the laws applying to those different types of manufacturers. However, like Head, Leppert said the ruling creates an “awkward situation with the law” that leaves the state vulnerable to the two-tier system.

The House Committee on Public Policy had not set a hearing on SB 1 by IL deadline.•


Post a comment to this story

We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
You are legally responsible for what you post and your anonymity is not guaranteed.
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
Subscribe to Indiana Lawyer
  1. I have had an ongoing custody case for 6 yrs. I should have been the sole legal custodial parent but was a victim of a vindictive ex and the system biasedly supported him. He is an alcoholic and doesn't even have a license for two yrs now after his 2nd DUI. Fast frwd 6 yrs later my kids are suffering poor nutritional health, psychological issues, failing in school, have NO MD and the GAL could care less, DCS doesn't care. The child isn't getting his ADHD med he needs and will not succeed in life living this way. NO one will HELP our family.I tried for over 6 yrs. The judge called me an idiot for not knowing how to enter evidence and the last hearing was 8 mths ago. That in itself is unjust! The kids want to be with their Mother! They are being alienated from her and fed lies by their Father! I was hit in a car accident 3 yrs ago and am declared handicapped myself. Poor poor way to treat the indigent in Indiana!

  2. The Indiana DOE released the 2015-2016 school grades in Dec 2016 and my local elementary school is a "C" grade school. Look at the MCCSC boundary maps and how all of the most affluent neighborhoods have the best performance. It is no surprise that obtaining residency in the "A" school boundaries cost 1.5 to 3 times as much. As a parent I should have more options than my "C" school without needing to pay the premium to live in the affluent parts of town. If the charter were authorized by a non-religious school the plaintiffs would still be against it because it would still be taking per-pupil money from them. They are hiding behind the guise of religion as a basis for their argument when this is clearly all about money and nothing else.

  3. This is a horrible headline. The article is about challenging the ability of Grace College to serve as an authorizer. 7 Oaks is not a religiously affiliated school

  4. Congratulations to Judge Carmichael for making it to the final three! She is an outstanding Judge and the people of Indiana will benefit tremendously if/when she is chosen.

  5. The headline change to from "religious" to "religious-affiliated" is still inaccurate and terribly misleading.