The First Appellate District of Ohio has affirmed a lower court’s decision siding with a local smoke shop against the Ohio Attorney General, ruling that federal law governing tobacco products preempts the state’s consumer protection claims. The case centered on whether the state could sue Elevate Smoke, LLC (d.b.a. Elev8 Smoke Shop) for selling unauthorized e-cigarettes that carried a specific federal warning label.
The appellate court concluded that the state’s claims, which essentially sought to enforce federal mandates through Ohio consumer protection laws, were implicitly preempted by the federal Tobacco Control Act (TCA).
The Core Legal Conflict: State vs. Federal Authority
The dispute arose after the Ohio Attorney General, Dave Yost, sued Elevate Smoke, alleging that selling certain e-cigarettes—specifically “Mr. Fog Max Air” and “EB Create, BC5000″—violated the Ohio Consumer Sales Practices Act (CSPA). The State argued that selling these products, which were unauthorized by the Food and Drug Administration (FDA) and bore the mandatory TCA “Origin Label” (“sale only allowed in the United States”), constituted deceptive and unconscionable sales practices.
Elevate Smoke countered that the TCA, which grants the FDA broad authority over the manufacturing, marketing, and labeling of e-cigarettes (now classified as tobacco products), preempted Ohio’s attempt to regulate the same area.
The trial court agreed with Elevate Smoke, granting summary judgment on the basis of federal preemption. The State appealed, raising two main arguments: that the trial court used the wrong legal standard when converting a motion to dismiss into a motion for summary judgment, and that the TCA did not preempt their CSPA claims.
Harmless Error in Procedure
The appellate court first addressed the procedural challenge. When Elevate Smoke filed a motion to dismiss, it included evidence outside the initial complaint, prompting the trial court to convert it into a motion for summary judgment. The State argued the judge then incorrectly applied the standard for a dismissal motion rather than the summary judgment standard (which requires assessing genuine issues of material fact).
While the appellate court agreed that the trial court cited the wrong standard initially, they deemed the error “harmless.” This was because the central issues—the interpretation of the TCA and the conflict between federal and state law—were purely questions of law, not fact. The facts regarding the unauthorized status of the e-cigarettes were not in dispute.
Preemption: The TCA’s Grip on E-Cigarettes
The heart of the ruling focused on preemption—the principle, derived from the U.S. Constitution’s Supremacy Clause, that valid federal law overrides conflicting state law.
The TCA comprehensively regulates tobacco products, requiring manufacturers to seek FDA premarket authorization for new products. The law also mandates specific labeling, including the Origin Label.
The court analyzed the TCA’s complex preemption structure:
1. Preservation Clause (Section 387p(a)(1)): This clause generally allows states to enact laws that are *more stringent* than the TCA regarding sales, distribution, and advertising.
2. Preemption Clause (Section 387p(a)(2)(A)): This clause expressly forbids states from imposing requirements related to product standards, premarket review, or labeling that are different from or *in addition to* federal requirements.
3. Savings Clause (Section 387p(a)(2)(B)): This clause carves out exceptions, protecting state laws relating to the *sale* and *distribution* of tobacco products, even if they touch upon areas covered by the preemption clause.
The court found that while some of the State’s claims might fall under the savings clause because they related to retail sales, the claims ran afoul of the doctrine of *implied* preemption, specifically the “conflict” type.
Conflict Preemption and Impossible Compliance
The appellate court relied heavily on the Supreme Court’s precedent in *Buckman v. Plaintiffs’ Legal Commt.*, which dealt with federal medical device regulation. In *Buckman*, state fraud claims that existed *only* because of federal disclosure requirements were preempted because Congress intended federal agencies to exclusively police fraud related to the federal approval process.
The Ohio court found that the State’s claims against Elevate Smoke were fundamentally tied to federal authorization requirements:
* Claims based on “Illegality” (Counts 1 & 2): The State claimed selling unauthorized e-cigarettes was deceptive or unconscionable. The court noted that whether a product is unauthorized (and thus “illegal” under the TCA) is determined *solely* by federal premarket authorization standards. Allowing the State to create civil liability based on this federal status effectively allows Ohio to enforce the TCA, which the TCA reserves exclusively for the United States government (21 U.S.C. § 337(a)).
* Claims based on Labeling (Counts 1 & 3): The State argued Elevate Smoke should have warned consumers that the products, despite bearing the Origin Label, were unauthorized. However, the TCA *requires* the Origin Label on new tobacco products. If Elevate Smoke were to add a state-mandated warning counteracting the Origin Label, it could violate federal labeling mandates (21 U.S.C. § 331(k)), which prohibit altering required TCA labels at the retail level. Compliance with the State’s theory would create an “impossibility” of compliance with federal law.
The court distinguished this case from others where states created separate regulatory directories, noting that here, the State’s claims would “cease to exist without the federal tobacco regulations.”
Ultimately, the court affirmed the trial court’s judgment, concluding that the Ohio Attorney General’s consumer protection claims were preempted by the federal regulatory scheme.
Elevate Smoke requested attorney fees, arguing the appeal was frivolous. The court denied this request, finding that the State’s appeal raised “reasonable questions for review.”