DCKT 129 - 0

Case 1:16-cv-01460-APM Document 129 Filed 06/04/19 Page 1 of 47
IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA
CIGAR ASSOCIATION OF AMERICA, et al., )

)
Plaintiffs, )
)
v. )
) Civil Action No. 16-1460 (APM)
UNITED STATES FOOD AND DRUG )
ADMINISTRATION, et al., )
)
Defendants. )
)
EN FUEGO TOBACCO SHOP LLC, doing )
business as En Fuego Tobacco Shop, et al., )
)
Plaintiffs, )
)
v. ) Civil Action No. 18-01797 (APM)
)
UNITED STATES FOOD AND DRUG )
ADMINISTRATION, et al., )
)
Defendants. )
REPLY IN FURTHER SUPPORT OF PLAINTIFFS’ MOTION FOR SUMMARY

JUDGMENT AND A PERMANENT INJUNCTION AND OPPOSITION
TO DEFENDANTS’ CROSS-MOTION FOR SUMMARY JUDGMENT
Dated: June 3, 2019 Michael J. Edney, DC Bar No. 492024

NORTON ROSE FULBRIGHT US LLP
799 9th Street, NW, Suite 1000
Washington, DC 20001-4501
Telephone: (202) 662-0200
Clyde M. Siebman, Texas Bar No. 18341600

Elizabeth S. Forrest, Texas Bar No. 24086207
SIEBMAN FORREST BURG & SMITH,
LLP
Federal Courthouse Square
300 N. Travis Street
Sherman, TX 75090
Telephone: (903) 870-0070
Counsel for Plaintiffs

TABLE OF CONTENTS
Page
INTRODUCTION ......................................................................................................................... 1
ARGUMENT ................................................................................................................................. 5
I. APPLYING THE WARNINGS TO PREMIUM CIGARS VIOLATES
THE FIRST AMENDMENT ................................................................................. 5
A. The Warnings Are Not “Purely Factual and Uncontroversial” as
Applied to Premium Cigars, and Are Subject to Strict or
Intermediate Scrutiny ................................................................................. 5
1. Recent Scientific Evidence Gathered by the FDA Shows
that the Categorical Warnings Do Not Fit Premium Cigars .......... 6
2. The Court Is Not Confined to the Original Administrative
Record when Deciding the Claim that the Warnings Are
Misleading Now ........................................................................... 11
B. The Warnings As Applied to Premium Cigars Fail the Scrutiny
Required by the First Amendment ........................................................... 13
1. The Warnings Do Not Serve a “Substantial” Interest.................. 13
2. The Warnings as Applied to Premium Cigars Do Not
Directly or Materially Advance a Substantial Interest ................. 15
3. The Warnings As Applied to Premium Cigars Are Too
Broad in Size and Scope, Failing Even the Zauderer Test .......... 16
C. The FDA’s Warning Plan Preapproval System Violates the First
Amendment .............................................................................................. 22
II. THE APPLICATION OF THE WARNINGS TO PREMIUM CIGARS IS
ARBITRARY AND CAPRICIOUS .................................................................... 24
A. The FDA’s Enforcement of the Warnings on Premium Cigars,
Despite the Agency’s Open Rulemaking Proceedings Seeking to
Change the Rule for Premium Cigars, Is Arbitrary and Capricious ........ 24
B. The FDA’s Imposition of the Warnings on Premium Cigars Was
Arbitrary and Capricious.......................................................................... 27
C. The FDA’s Failure to Make the Requisite Statutory Findings
Specific to Premium Cigars Renders the Rule “Contrary to Law” in
Violation of the APA and the Family Smoking Prevention Act .............. 30
III. THE ISSUANCE OF THE FDA’S FINAL RULE VIOLATED THE
CONSTITUTION’S APPOINTMENTS CLAUSE............................................. 31
A. Plaintiffs Have Not Waived Their Appointments Clause Claim ............. 31
-i-
B. The Deeming Rule Was Not Issued By A Properly Appointed

Officer Of The United States ................................................................... 32
C. Ratification Has Not Cured the Appointments Clause Defect................. 34
IV. PLAINTIFFS’ CLAIMS ARE NOT BARRED BY RES JUDICATA ................ 35
CONCLUSION ............................................................................................................................ 39
- ii -
TABLE OF AUTHORITIES
Page(s)
Cases
Alfa Int’l Seafood v. Ross,

264 F. Supp. 3d 23 (D.D.C. 2017) ...........................................................................................34
Aluminum Co. of Am. v. ICC,

761 F.2d 746 (D.C. Cir. 1985) .................................................................................................37
*Am. Beverage Ass’n v. City & Cty. of S.F.,

916 F.3d 749 (9th Cir. 2019) .........................................................................................3, 20, 21
Am. Meat Inst. v. U.S. Dep’t of Agriculture,

760 F.3d 18 (D.C. Cir. 2014) .....................................................................................................9
Apotex, Inc. v. FDA,

393 F.3d 210 (D.C. Cir. 2004) .................................................................................................38
Arizona v. Thompson,
281 F.3d 248 (D.C. Cir. 2002) .................................................................................................27
Assn’ of Am. R.R. v. U.S. Dep’t of Transp.,

821 F.3d 19 (D.C. Cir. 2016) ...................................................................................................33
Associated Mortg. Bankers Inc. v. Carson,

2017 WL 6001733 (D.D.C. Dec. 1, 2017) ...............................................................................32
Bellion Spirits, LLC v. United States,

335 F. Supp. 3d 32 (D.D.C. 2018) ...........................................................................................12
Cal. Cosmetology Coal. v. Riley,

871 F. Supp. 1263 (C.D. Cal. 1994), aff'd, 110 F.3d 1454 (9th Cir. 1997) .............................36
Cigar Ass’n v. FDA,

315 F. Supp. 3d 143 (D.D.C. 2018) ................................................................................. passim
City of Kansas City, Mo. v. Dep't of Hous. & Urban Dev.,

923 F.2d 188 (D.C. Cir. 1991) .................................................................................................16
*CTIA—The Wireless Ass’n v. City & Cty. of S.F.,

827 F. Supp. 2d 1054 (N.D. Cal. 2011) ...............................................................................9, 11
Desert Outdoor Adver., Inc. v. City of Moreno Valley,

103 F.3d 814 (9th Cir. 1996) ...................................................................................................24
Devlin v. Transp. Commcn’s Int’l Union,

175 F.3d 121 (2d Cir. 1999).....................................................................................................39
Discount Tobacco City & Lottery, Inc. v. United States,

674 F.3d 509 (6th Cir. 2012) ...................................................................................................22
- iii -
Drake v. FAA,
291 F.3d 59 (D.C. Cir. 2002) ...................................................................................................38
Edmond v. U.S.,
520 U.S. 651 (1997) .................................................................................................................33
Estes v. U.S. Dep’t of the Treasury,

219 F. Supp. 3d 17 (D.D.C. 2016) .....................................................................................31, 32
Evans v. Salazar,
Case No. 08-0372, 2010 WL 11565108 (W.D. Wash. July 7, 2010) ......................................13
Fox Television Stations, Inc. v. FCC,

280 F.3d 1027 (D.C. Cir. 2002) ...............................................................................................15
FW/PBS, Inc. v. City of Dall.,

493 U.S. 215 (1990) .................................................................................................................22
Guedes v. Bureau of Alcohol, Tobacco, Firearms and Explosives,

920 F.3d 1 (D.C. Cir. 2019) ...............................................................................................34, 35
Heckler v. Chaney,
470 U.S. 821 (1985) .................................................................................................................25
Humane Soc’y of U.S. v. Zinke,

865 F.3d 585 (D.C. Cir. 2017) .................................................................................................28
Hunt v. City of L.A.,

638 F.3d 703 (9th Cir. 2011) ...................................................................................................23
Inst. of Marine Mammal Studies v. Nat’l Marine Fisheries Serv.,

23 F. Supp. 3d 705 (S.D. Miss. 2014)......................................................................................13
Jarita Mesa Livestock Grazing Ass’n v. U.S. Forest Serv.,

140 F. Supp. 3d 1123 (D.N.M. 2015) ......................................................................................13
Katz v. Gerardi,
655 F.3d 1212 (10th Cir. 2011) ...............................................................................................38
Lorillard Tobacco Co. v. Reilly,

533 U.S. 525 (2001) .................................................................................................................14
McCullen v. Coakley,
573 U.S. 464 (2014) .................................................................................................................21
Motor Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co.,
463 U.S. 29 (1983) .............................................................................................................15, 29
N.Y. Magazine v. MTA,

136 F.3d 123 (2d Cir. 1998).....................................................................................................24
*Nat’l Ass’n of Home Builders v. EPA,

682 F.3d 1032 (D.C. Cir. 2012) ...............................................................................................30
- iv -
*Nat’l Ass’n of Mfrs. v. SEC,

800 F.3d 518 (D.C. Cir. 2015) .....................................................................................12, 21, 22
*Nat’l Ass’n of Wheat Growers v. Zeise,

309 F. Supp. 3d 842 (E.D. Cal. 2018)..................................................................................9, 11
*Nat’l Inst. of Family & Life Advocates v. Becerra,

138 S.Ct. 2361 (2018) ...................................................................................................... passim
Nat’l Med. Enters., Inc. v. Shalala,

826 F. Supp. 558 (D.D.C. 1993) ..............................................................................................12
Noble Energy, Inc. v. Salazar,

671 F.3d 1241 (D.C. Cir. 2012) ...............................................................................................28
Nutritional Health All. v. Shalala,

144 F.3d 220 (2d Cir. 1998).........................................................................................22, 23, 24
P&V Enters. v. U.S. Army Corps. Of Eng’rs,

516 F.3d 1021 (D.C. Cir. 2008) ...............................................................................................26
Pearson v. Shalala,
164 F.3d 650 (D.C. Cir. 1999) .................................................................................................24
Porter v. Califano,
592 F.2d 770 (5th Cir. 1979) ...................................................................................................12
*R.J. Reynolds Tobacco Co. v. FDA,

696 F.3d 1205 (D.C. Cir. 2012) ...................................................................................13, 14, 29
Robbins v. U.S. Bureau of Land Mgmt.,

438 F.3d 1074 (10th Cir. 2006) ...............................................................................................13
Robinson v. Veneman,
124 Fed. Appx. 893 (5th Cir. 2005) .........................................................................................13
Rotec Indus., Inc. v. Mitsubishi Corp.,

348 F.3d 1116 (9th Cir. 2003) ...........................................................................................38, 39
Rubin v. Coors Brewing Co.,

514 U.S. 476 (1995) ...........................................................................................................14, 21
Rydeen v. Quigg,
748 F. Supp. 900 (D.D.C. 1990) ..............................................................................................12
In re Search of Kitty’s E.,

905 F.2d 1367 (10th Cir. 1990) ...............................................................................................24
*Taylor v. Sturgell,
553 U.S. 880 (2008) ...........................................................................................................35, 37
Tesoro Alaska Co. v. FERC,

778 F.3d 1034 (D.C. Cir. 2015) ...............................................................................................32
-v-
Thompson v. W. State Med. Ctr.,

535 U.S. 357 (2002) .................................................................................................................20
U.S. Postal Serv. v. Athena Prods.,

654 F.2d 362 (5th Cir. 1981) ...................................................................................................24
United States v. Concord Mgmt.,

317 F. Supp. 3d 598 (D.D.C. 2018) .........................................................................................34
United States v. Stevens,

559 U.S. 460 (2010) .................................................................................................................24
Utah Power & Light Co. v. ICC,

764 F.2d 865 (D.C. Cir. 1985) .................................................................................................37
Western Coal Traffic League v. ICC,

735 F.2d 1408 (D.C. Cir. 1984) .........................................................................................36, 37
Zauderer v. Office of Disciplinary Counsel of Supreme Ct. of Ohio,

471 U.S. 626 (1985) ......................................................................................................... passim
Statutes, Rules, and Regulations
5 U.S.C. § 302 ................................................................................................................................34
5 U.S.C. § 533 ................................................................................................................................35
7 U.S.C. § 610 ................................................................................................................................33
20 U.S.C. § 3461 ............................................................................................................................33
49 U.S.C. § 323 ..............................................................................................................................33
Federal Food, Drug, and Cosmetic Act, 21 U.S.C. § 301 et. seq. .....................4, 10, 30, 31, 33, 34
21 C.F.R. § 1143 ..........................................................................................................10, 18, 19, 24
Final Rule, Deeming Tobacco Products to Be Subject to the Federal Food, Drug,
and Cosmetic Act, 81 Fed. Reg. 28,974 (May 10, 2016) ................................................ passim
Proposed Rule, Deeming Tobacco Products to Be Subject to the Federal Food,

Drug, and Cosmetic Act, 79 Fed. Reg. 23,142 (Apr. 25, 2014) ........................2, 17, 19, 27, 31
Regulation of Premium Cigars, 83 Fed. Reg. 12,901 (Mar. 26, 2018) ..............6, 11, 16, 25, 31, 38
- vi -
Plaintiffs En Fuego Tobacco Shop LLC (“En Fuego”), Cuba Libre Enterprises LLC (“El
Cubano”), and Texas Cigar Merchants Association (“TxCMA”) file this memorandum of law in
further support of their motion for summary judgment and a permanent injunction and in
opposition to the Government’s cross-motion for summary judgment.
INTRODUCTION
The FDA has required massive warnings on every premium cigar box and every
communication a premium cigar manufacturer or retailer makes about their products. This Court
declined to consider arguments particular to premium cigars in its last ruling regarding the FDA’s
warnings scheme. Issues specific to the FDA’s rough and devastating treatment of premium cigars
are directly at issue in the Texas Plaintiffs’ claims.
What is apparent is that premium cigars are different than mass-produced cigars and other
tobacco products. Premium cigar consumers use the products very infrequently, in a manner
demonstrating the products are not being used to feed a nicotine addiction. Premium cigar
consumers are older, better educated, higher-income, and already making apparently calibrated
decisions about how often they use the product.
When forced to defend its warnings mandate on premium cigars, the Government has to
bend the First Amendment beyond recognition. It says that the courts must take a light touch if
the words of the warning “when read literally” are true, regardless of whether the warnings are
misleading or incomplete. Gov. Br. 22 (ECF No. 124). Of course, the First Amendment provides
no such license for the Government to compel misleading and incomplete speech. And the
Government makes no meaningful effort to argue that the warnings are not misleading when
applied to premium cigars. The undisputed evidence before the Court shows that nearly all
premium cigar consumers use the product less frequently than daily, the median consumer uses
the product 1.7 days per month, and that less than daily use of cigars does not increase mortality
in a statistically significant manner. Nonetheless, the Government feels no obligation to add the
simplest qualification “when used frequently” or “when used in combination with other tobacco
products” to its blaring statement that the product causes cancer. While that may have made sense
with cigarettes, where nearly every consumer uses the product daily (the median, 29.4 days per
month), it is indefensible for premium cigars. The warnings are not purely factual and
uncontroversial without such clarifications.
Moreover, when it comes to premium cigars, the FDA abandons almost every one of its
original reasons for the warnings in the Rule. The agency had said that the warnings were
necessary to prevent initiation of tobacco use by uninformed and impressionable youth. See 81
Fed. Reg. 28,974 at 29,063, 29,064, 29,070. That justification is nowhere to be found in the
Government’s defense of applying the warnings to premium cigars, for which youth use is so small
it cannot be reliably measured. The agency said it implementing the warnings to guard against
migration from cigarettes to cigars for nicotine delivery. See 79 Fed. Reg. 23,142 at 23,146-47;
81 Fed. Reg. at 29,070. But it is apparent that premium cigar consumers are not using the product
for that purpose, or else they would be using the product far more frequently. The agency instead
doubles down on its claim that the warnings are required to correct misperceptions about cigars,
but the agency presents no evidence whatsoever that premium cigar consumers harbor such
erroneous views about their health effects.
The Government is even less eager to grapple with the Supreme Court’s framework for
evaluating government compelled warnings, definitively established at the end of last term in
National Institute of Family & Life Advocates v. Becerra. Now, even purely factual and
uncontroversial warnings must “extend no broader than reasonably necessary.” Becerra, 138 S.
Ct. 2361, 2377 (2018). The Government wants the Court to believe nothing has changed and that
2
the Government may still maintain that the Zauderer test for purely factual and uncontroversial
warnings is indistinguishable from rational basis review. But the Government should let Justice
Breyer know. After all, in dissent, he observed that the majority had effectively merged the
Zauderer review of means and ends with that required under Central Hudson, not rational basis
review. Becerra, 138 S. Ct. at 2390 (Breyer, J., dissenting). And the wishful thinking of federal
speech regulators is not shared by the en banc Ninth Circuit, which struck down health warnings
covering just 20 percent—not the 30 percent at issue here—of sugar-added beverage
advertisements. Am. Beverage Ass’n v. City & Cty. of S.F., 916 F.3d 749, 757 (9th Cir. 2019).
Of course, the warnings as applied to premium cigars extend “broader than reasonably
necessary” and thus violate the First Amendment. Becerra, 138 S. Ct. at 2377. First, they extend
to premium cigars in the first place, despite the complete absence of evidence that there is a
problem to solve and that the warnings would do it. Second, they blare the Government’s message,
taking 30 percent of two package panels, and 20 percent of advertisements. They must be repeated
hundreds of times in the boutique humidors where premium cigars are sold. Their size and
repetition aggravates the misleading and incomplete picture the warnings portray with regard to
premium cigars, suggesting that the manner in which the products are used by nearly everyone will
kill you.
Third, the warnings will transform premium cigar packages in a unique and devastating
way. Cigarettes and mass produced cigars are sold in gas stations, in utilitarian plastic wrap,
destined for the trash can as soon as the product is finished. Premium cigar boxes, by contrast, are
luxury items, kept long after their purchasers slowly work their way through the contents. No
more with the FDA rule; the warnings will radically change artisan and keepsake premium cigar
packaging forever.
3
With no evidence that there is wide ranging behavior with regard to premium cigars to
correct, much less that the warnings will change this behavior, the Government makes no case that
these huge warnings are needed on premium cigar products.
The Court also has a simple way to dispatch the FDA’s warnings as applied to premium
cigars. The agency mistakenly believed that requiring these warnings on premium cigars was
legally required after it had made the decision to reject so-called Option 2 and deem premium
cigars as well “subject to the Act.” The warnings, though, do not flow from the decision to deem
a product subject to the Act. They arise from a separate head of statutory authority, under which
the agency may conceive marketing restrictions for particular tobacco products once it makes
certain findings. See FD&C Act § 906(d)(1), 21 U.S.C. § 387f(d)(1). Because the agency did not
exercise this discretion and erroneously believed applying the warnings to premium cigars was
required by another decision, the Court should vacate the warnings as applied to premium cigars
and remand the rule to the agency.
This Court is now squarely confronted with the agency’s “grossly unfair” decision to
enforce the warnings requirement, despite opening a process to change or eliminate the warnings
as applied to premium cigars. See Cigar Ass’n v. FDA, 315 F. Supp. 3d 143, 175 (D.D.C. 2018).
In opening this rulemaking process, the agency acknowledged that premium cigars—and the
appropriateness of mandating warnings for them—required more study and research. When the
agency made this announcement, and then opened the rulemaking, the warnings requirement still
had not gone into effect. This is not like beginning a process to reconsider a regulation of primary
conduct, already in effect. The agency delayed future compliance dates implementing other
regulatory requirements to avoid costs while it opened rulemaking proceedings to change those
requirements. At a minimum, the Court should vacate the compliance deadline for the warnings
4
requirement until the agency sets another one after the completion of its premium cigar rulemaking
proceedings.
ARGUMENT
I. APPLYING THE WARNINGS TO PREMIUM CIGARS VIOLATES THE FIRST

AMENDMENT
As the Government would have it, this Court already has decided the First Amendment
claims. But the Government’s selective quoting of this Court’s prior opinion forgets that this Court
treated premium cigars, and the particular effects of the FDA’s warnings on this category of products,
as a distinct issue that was not presented for decision. See Cigar Ass’n, 315 F. Supp. 3d at 157, 166.
The Government fails adequately to grapple with what makes premium cigars different.
A. The Warnings Are Not “Purely Factual and Uncontroversial” as Applied

to Premium Cigars, and Are Subject to Strict or Intermediate Scrutiny
The First Amendment demands more than “mostly factual” or true “when read literally”
compelled speech (Gov. Br. 22): To qualify for Zauderer review the compelled speech must be
“purely factual and uncontroversial.” Zauderer v. Office of Disciplinary Counsel of Supreme Ct.
of Ohio, 471 U.S. 626, 651 (1985) (emphasis added). Studies funded and authored by FDA staff
show that 96.5% of premium cigar consumers use the product less frequently than daily and that
nondaily use leads to no statistically significant increase in mortality. Yet the warnings blare the
risk of cancer and heart disease without qualification, omitting qualifiers such as “if used
frequently” or “in combination with other tobacco products,” this product causes cancer. The FDA
warnings, as applied to premium cigars, provide an incomplete and misleading picture of their
health risks.
5
1. Recent Scientific Evidence Gathered by the FDA Shows that the

Categorical Warnings Do Not Fit Premium Cigars
The Government does not meaningfully contest the scientific evidence regarding premium
cigars. Premium cigars are used infrequently: The median consumer of premium cigars consumes
the product 1.7 days per month; 96.5% use the product less frequently than daily. Op. Br. 10, 16
(ECF No. 120). And FDA staff have found that those who use cigars less than daily have no
“statistically significant increased risk of death.” Gov. Br. 24 (citing Carol H. Christensen et al.,
Association of Cigarette, Cigar, and Pipe Use With Mortality Risk in the US Population, JAMA
Internal Med., Feb. 19, 2018, at E1, E6 tbl.3) (Ex. E). 1
At most, the Government is trimming around the edges of these core scientific claims.
With regard to the low frequency of premium cigar use, the Government can hardly contest that
nearly all premium cigar consumers use the product less than daily, and most only slightly more
than one day per month. After all, the FDA’s own pending rulemaking release on premium cigars
highlighted Dr. Corey’s review of the FDA Center for Tobacco Products’ Population Assessment
of Tobacco and Health (PATH) Study as establishing that users of premium cigars “report smoking
them on fewer days” and “consuming fewer cigars per day.” See 83 Fed. Reg. 12,901 at 12,902-03
(citing Catherine G. Corey et al., U.S. Adult Cigar Smoking Patterns, Purchasing Behaviors, and
Reasons for Use According to Cigar Type: Findings from the Population Assessment of Tobacco
and Health (PATH) Study, 2013-14, Nicotine & Tobacco Res., Sept. 15, 2017 (Ex. D)).
Government litigation counsel clearly recognizes the importance of this scientific evidence. They
try to focus on an older figure, that 7.5 percent of premium cigar consumers use the product daily.
Gov. Br. 24. But the most recent set of PATH data, from 2015-2016, shows that number has
1
Unless otherwise defined herein, all “Ex.” and “Decl.” citations refer to Exhibits and
Declarations filed with Plaintiffs’ opening brief.
6
dropped to 3.5% of premium cigar consumers. See Faten Sabry, et al., Report Regarding
Consumption Patterns of Premium Cigars, July 25, 2018, at ¶¶ 40-44, tbls.4a-c (Sabry Decl.
Ex. 1). And this is no aberrational finding based on a small data set, as the PATH Study tracks
nearly 46,000 adults and youth in the United States.
Nor does the Government seriously contest the health effects of smoking cigars less
frequently than daily. It says “a nonsignificant association in one study does not mean that no
association exists.” Gov. Br. 23 n.13. But that ignores that Dr. Christensen derived her finding
from a massive dataset collected by following 357,420 Americans for 26 years. See Christensen,
et al. at E2 (Ex. E). And the Government does not identify a single study that found a different
result. That one study of a few hundred cigar users reported that nondaily cigar users had higher
levels of certain “biomarkers of tobacco exposure” in their blood than nonsmokers is a far cry from
showing higher risk of illness or mortality for nondaily cigar users. See Jiping Chen, et al.,
“Biomarkers of Exposure among U.S. Cigar Smokers: An Analysis of 1999-2012 National Health
and Nutrition Examination Survey (NHANES) Data,” Cancer Epidemiology Biomarkers
Prevention, 23(12):2906-2915 (2014), at 2911 & tbl.3 (cited at Gov. Br. 23 n. 13). 2
2
Amici cite two studies published in 2017 that they claim “demonstrate that large and premium
cigars pose substantial health risks.” ECF No. 80 at 19. The first study did not include any
information on the type of cigar smoked or the frequency of use of such products and thus has
nothing to say about premium cigars or the overwhelming majority of their consumers who use
them only occasionally. See Malhotra, et al., “Association between Cigar or Pipe Smoking and
Cancer risk in Men: A Pooled Analysis of Five Cohort Studies,” Cancer Prevention Research
2017;10:704-09. The second study merely observed “laboratory ad lib smoking” of a single
mass-market, filtered cigar brand (Phillies Blunts) by 21 study participants, and collected no data
on frequency of use or health risks in relation thereto. See Pickworth, et al., “Dual Use of
Cigarettes, Little Cigars, Cigarillos, and Large Cigars: Smoking Topography and Toxicant
Exposure,” Tobacco Regulatory Science 2017 April 3(Suppl 1): S72-S83. Neither study was cited
by the agency in its cross-motion or in the premium cigars ANPRM.
7
So the agency is left to argue that its massive warnings on premium cigars are needed to
change the behavior of—and avoid the negative health effects on—the sliver of premium cigar
consumers who do use them daily. Gov. Br. 24. That’s 3.5 percent of the 0.48 percent of adults
who smoke premium cigars: At most, 43,000 Americans. 3 Using such massive warnings to chase
after a small percentage of users is plainly unjustified and broader than is necessary. The agency
could send an educational team to the home of each such American for less than the warnings
requirement will cost premium cigar manufacturers and retailers. After all, the FDA estimates that
a single premium cigar manufacturer with 1,670 unique products would spend between $2.5
million and $27.8 million to implement the warnings. See AR130285–86, AR024019.
The Government next contends it needs the warnings to educate or change the behavior of
“premium cigar users who also use other tobacco products.” Gov. Br. 24-25. The prospect that
some premium cigar consumers also use other tobacco products, which themselves may be used in
a manner that presents higher risks, does not make the unqualified warnings on premium cigars
“purely factual and uncontroversial.” The data confirm that for these so-called “dual users,” it is
cigarettes and cigarette substitutes that are the problem. The median premium cigar user who also
is a current established cigarette smoker (just 24.0% of premium cigar users by PATH Wave 3)
3
The Government’s estimate that this equates to “132,944 U.S. adults” (Gov. Br. 24) is
exaggerated as it cherry picks the highest (albeit still tiny) percentages from older PATH data. See
Sabry et al. at tbl.2, tbls.4a-c (Sabry Decl. Ex. 1). The same estimation using the most recent
PATH Wave 3 (2015-2016) data shows fewer than 43,000 adults in the entire United States who
use premium cigars daily (i.e., less than a third as many). See id. (0.0168% of U.S. adults are daily
premium cigar users); Gov. Br. 24 n.14 (253,227,593 total U.S. adults). The Government also
grossly exaggerates the number of youth who use premium cigars. Gov. Br. 32. Articles written
by FDA staff analyzing the best available data from the PATH Study have concluded that
underaged use of premium cigars is so rare that it cannot be reliably measured. See Karin A. Kasza
et al., Tobacco-Product Use by Adults and Youths in the United States in 2013 and 2014, 376 N.
Engl. J. Med. 342 (2017), at 349, supp. app. at 14 tbl.S4 (Ex. F); see also Sabry et al. at ¶¶ 25-26,
tbl.1 (overall youth prevalence 0.08%-0.02%).
8
consumes premium cigars less frequently (only 0.7-1.1 days per month) than the median user of
premium cigars who does not also use cigarettes (1.5-1.9 days per month). See Sabry et al. at
¶¶ 57-62, tbls.9a-c, 10a-c (Sabry Decl. Ex. 1). Cigarettes smokers plainly are not turning to premium
cigars to feed their nicotine addiction. And any educational mission could be achieved and better
advanced, by warnings on cigarettes or other tobacco products, not the premium cigars they use so
infrequently.
In the face of this evidence, the Government seeks to create a new legal standard, that the
Plaintiffs must establish that “when read literally, each of the health warnings is incorrect on its
face,” to show that a warning is not “purely factual and uncontroversial.” Gov. Br. 22 (emphases
added). But, of course, forced warnings that are misleading or materially incomplete fail the
Zauderer standard. After all, even purportedly “factual” disclosures can be “so one-sided or
incomplete that they would not qualify as ‘factual and uncontroversial.’” Am. Meat Inst. v. U.S.
Dep’t of Agriculture, 760 F.3d 18, 27 (D.C. Cir. 2014). And even if “each factoid in isolation”
may be accurate, a full message that is “misleading by omission” does not qualify for Zauderer
scrutiny. CTIA—The Wireless Ass’n v. City & Cty. of S.F., 827 F. Supp. 2d 1054, 1062–63 (N.D.
Cal. 2011), aff’d in relevant part, 494 App’x 752 (9th Cir. 2012). So divorced from the First
Amendment is the Government’s argument that it claims Zauderer is satisfied so long as it does
not force “personal opinion or political information,” regardless of whether it is misleading. Gov.
Br. 18. But the Zauderer gatekeeping standard is not guarding against only forced political
commentary; it requires an analysis of scientific accuracy. See Nat’l Ass’n of Wheat Growers v.
Zeise, 309 F. Supp. 3d 842, 850-53 (E.D. Cal. 2018) (cancer warning was not “purely factual and
uncontroversial” under Zauderer given “evidence in the record” showing a scientific “debate
9
regarding . . . carcinogenicity”), reconsideration denied, 2018 WL 3000488 (E.D. Cal. June 12,
2018).
When the correct legal standard is applied, the Government has no excuse for not adding
qualifying language to its warnings to render them not misleading. The clarifying phrases span
three to eight words: This product “increases the risk of lung cancer and heart disease, if used
frequently” or “if used in combination with other tobacco products.” Compare 21 C.F.R.
§ 1143.5(a)(1) (e.g., “WARNING: Tobacco smoke increases the risk of lung cancer and heart
disease . . . .”). It is certainly not for lack of space: The agency is confiscating 30 percent of the
two principal package panels. And the FDA has not only refused to qualify its strident warnings
when applied to premium cigars, but has banned Plaintiffs from doing so. The Government says
that the statute bans products rather than speech (Gov. Br. 23), but it is what manufacturers and
retailers say about the products that makes them prohibited. See FD&C Act § 911(a), (b)(2)(A),
21 U.S.C. § 387k(a), (b)(2)(A) (product’s “label, labeling, or advertising” cannot, without FDA
approval, “represent[] explicitly or implicitly” that it “presents a lower risk of tobacco-related disease
or is less harmful”). Dangling the opportunity to apply to the FDA and then await approval to add
information to the warnings to make them accurate is no cure for a constitutional violation. Gov.
Br. 23. The warnings are required now; fixing the Government’s incomplete and mandatory
statement cannot depend on whenever the Government gets around to saying yes.
The Government’s complaint that it is a “hyperbolic interpretation of the warnings” to read
them as threatening the typical user with premature death (Gov. Br. 23) adopts a more relaxed
view than most of contracting “lung cancer and heart disease” or “cancers of the mouth and throat.”
See 21 C.F.R. § 1143.5. And the excuse that the “warnings are akin to the brief Surgeon General’s
warnings that have long been found on cigarettes” merely begs the question of whether warnings
that differ in content are factual and uncontroversial when applied to premium cigars without
10
qualification. Gov. Br. 23. The answer to that question is a resounding no: While the median
consumer of cigarettes smokes them nearly every day, the median consumer of premium cigars
uses them only 1.7 days per month, i.e., with a frequency that leads to no statistically significant
increase in mortality. See Sabry et al. at ¶¶ 40-44, tbls.4a-c (Sabry Decl. Ex. 1); Corey et al. at 5
tbl.2 (Ex. D); Christensen et al. at E1, E6 tbl.3 (Ex. E).
Further, the agency effectively admitted that the warnings are “controversial” as applied to
premium cigars when it opened a rulemaking docket citing Dr. Corey’s analysis of PATH data and
seeking further studies and information bearing on the accuracy and completeness of the warnings.
See 83 Fed. Reg. at 12,902-04. The Government’s suggestion that the agency’s ANPRM was
issued merely to placate “industry and Members of Congress” is not credible. Gov. Br. 21. Quite
the opposite: In its own words, the FDA deems “the regulatory considerations with respect to
premium cigars, their use, and related public health issues” to be “a topic of ongoing and emerging
research,” and seeks additional studies and information concerning (in part) warnings on premium
cigars to “inform FDA’s thinking about the regulation of premium cigars.” See 83 Fed. Reg.
at 12,902. That the agency has conceded that the application of the warnings to premium cigars
requires further scientific study alone makes the warnings “controversial.” See Nat’l Ass’n of
Wheat Growers, 309 F. Supp. 3d at 852-54 (striking down compelled disclosure where some
studies were to the contrary); CTIA—The Wireless Ass’n, 827 F. Supp. 2d at 1062–63 (competing
authorities rendered disclosure “neither factual nor uncontroversial”).
2. The Court Is Not Confined to the Original Administrative Record

When Deciding the Claim that the Warnings Are Misleading Now
It is revealing that the Government’s first resort is to tell this Court that it cannot even
consider studies funded by the FDA, prepared by FDA staff, and cited in the FDA’s premium cigar
rulemaking notice because “review is limited to the administrative record.” Gov. Br. 19. But at least
11
one Circuit and multiple Judges in this District have rejected that overly restrictive view where, as
here, Plaintiffs bring direct claims under the United States Constitution. See Porter v. Califano, 592
F.2d 770, 780–81 (5th Cir. 1979); Nat’l Med. Enters., Inc. v. Shalala, 826 F. Supp. 558, 565 n.11
(D.D.C. 1993); Rydeen v. Quigg, 748 F. Supp. 900, 906 (D.D.C. 1990). The Government’s reliance
on the “plain text of the APA” erroneously attempts to elevate a statute over the Constitution. Gov.
Br. 20. First Amendment freedoms do not turn on what evidence happened to exist at the time an
agency conducted a rulemaking. Such a restriction would be particularly senseless here given that
all of the evidence Plaintiffs present was either cited by the agency when opening its pending
premium cigar rulemaking docket or submitted to the agency in response thereto.
The Government cites no authority that restricts review of substantive First Amendment
challenges to the agency record. Gov. Br. 19-21. The sole decision from this District on which
the Government relies “decline[d] to adopt any bright line or categorical rule.” Bellion Spirits,
LLC v. United States, 335 F. Supp. 3d 32, 43 (D.D.C. 2018). In that case, the plaintiffs were
challenging an agency’s rejection of a petition to approve health claims about alcohol and wanted
the Court to consider evidence it had not included in its petition. The Court was clear that the
plaintiff could get the evidence considered, simply by filing a new petition seeking approval of the
claim and challenging a denial of that petition, if it occurred. Id. at 45. Of course, that is not the
case here. This does not involve the approval process for an affirmative health claim, which the
plaintiffs can renew before the agency. Instead, the FDA has permanently required Plaintiffs to
speak against their will. The First Amendment simply does not permit a permanent compulsion
of speech, no matter that evidence arising after the date of an agency decision demonstrates that
the warnings are misleading. After all, “propositions once regarded as factual and uncontroversial
may turn out to be something quite different.” See Nat’l Ass’n of Mfrs. v. SEC, 800 F.3d 518, 528
12
(D.C. Cir. 2015). This Court need not shut its eyes to important evidence outside the administrative
record when evaluating Plaintiffs’ First Amendment claims. The APA cannot, and does not, freeze
the world to which the Constitution and its First Amendment apply. 4
B. The Warnings As Applied to Premium Cigars Fail the Scrutiny Required by

the First Amendment
If the agency wishes to press its misleading and incomplete message upon every premium
cigar box and communication, it must satisfy strict scrutiny. That is the clear holding of the 2018
Supreme Court’s Becerra decision. See Becerra, 138 S. Ct. at 2372. The Government’s effort to
reach back to prior D.C. Circuit authority, and take refuge in Central Hudson review as it blares
its misleading warnings, is contrary to now-binding Supreme Court precedent. Gov. Br. 36 n.20.
Regardless, the Government’s arguments that Central Hudson scrutiny is a light touch, which its
premature and under-reasoned warnings mandate can survive, are wrong. Gov. Br. 34-36. With
regard to the warnings’ scope reaching premium cigars and their size, the Supreme Court now has
put little distance between Central Hudson and Zauderer scrutiny.
1. The Warnings Do Not Serve a “Substantial” Interest
Contrary to the Government’s wishful assertions, this Court did not conclude that “helping
consumers understand” health risks is a “substantial interest” under the Central Hudson test. Gov.
4
To the extent the Government suggests that the D.C. Circuit addressed this question in R.J.
Reynolds (Gov. Br. 21), it mistakenly relies on dicta and overlooks that the D.C. Circuit was not
asked to consider extra-record evidence. See R.J. Reynolds Tobacco Co. v. FDA, 696 F.3d 1205,
1217-18 (D.C. Cir. 2012). The Government’s citations to various out-of-Circuit decisions reflect
the same mistake. See Inst. of Marine Mammal Studies v. Nat’l Marine Fisheries Serv., 23
F. Supp. 3d 705, 718 (S.D. Miss. 2014) (no party proffered extra-record evidence concerning Fifth
Amendment claim); Robbins v. U.S. Bureau of Land Mgmt., 438 F.3d 1074, 1085 (10th Cir. 2006)
(same); Robinson v. Veneman, 124 Fed. Appx. 893, 895 (5th Cir. 2005) (not precedential) (same);
Evans v. Salazar, Case No. 08-0372, 2010 WL 11565108, at *2 (W.D. Wash. July 7, 2010)
(denying motion to compel discovery from government pursuant to “general rule against discovery
in APA cases”); Jarita Mesa Livestock Grazing Ass’n v. U.S. Forest Serv., 140 F. Supp. 3d 1123,
1152 (D.N.M. 2015) (no constitutional claim remaining).
13
Br. 25, 32. Instead, this Court relied on the D.C. Circuit’s application of the Zauderer test in
American Meat, to reason by analogy that better informing consumers is good enough for
evaluating “purely factual and uncontroversial” disclosures. See Cigar Ass’n, 315 F. Supp. 3d
at 169. This test, however, has no place when evaluating misleading and incomplete warning
mandates. It makes absolutely no analytical sense, as a misleading warning would almost never
“help consumers understand,” if that term is to mean giving consumers an accurate impression of
the scientific evidence. And, of course, this contention squarely confronts the D.C. Circuit’s
decision in R.J. Reynolds, holding that a bare interest in the communication of tobacco product
health risks to consumers, without aiming to improve health outcomes or even to reduce smoking
rates, is not “substantial” for purposes of Central Hudson. See R.J. Reynolds, 696 F.3d at 1221.
Regardless, an interest in better communication clearly is not “compelling” for purposes
of strict scrutiny, contrary to the Government’s ambitious claims. Gov. Br. 36. Compelling
interests concern actually advancing health and safety, not simply informing people and
disclaiming any effect on improving health outcomes. See Rubin v. Coors Brewing Co., 514 U.S.
476, 485 (1995) (finding “substantial interest” in preventing “social harm” and “greater
alcoholism” that would follow from “brewers . . . competing on the basis of alcohol strength”)
Indeed, the D.C. Circuit was even “skeptical” that the government possessed a “substantial”
interest in “reducing smoking rates” among adults. See R.J. Reynolds, 696 F.3d at 1218 & n.13;
see also Lorillard Tobacco Co. v. Reilly, 533 U.S. 525, 564 (2001) (“As the State protects children
from tobacco advertisements, tobacco manufacturers and retailers and their adult consumers still
have a protected interest in communication.”).
14
2. The Warnings as Applied to Premium Cigars Do Not Directly or

Materially Advance a Substantial Interest
As for “directly and materially advancing” a substantial interest, the Government plainly
has failed to carry its burden with regard to premium cigars. The Government talks about
“correcting . . . misperceptions that have arisen” (Gov. Br. 32), but it admits that the record contains
no “evidence directly from premium cigar studies” concerning the “misperceptions” allegedly held
by premium cigar consumers, or that these warnings would remedy them. Gov. Br. 33. Instead, the
agency wants the Court to trust its “judgment” in making the leap from studies regarding the
perceptions of health risks for other tobacco products, to premium cigars. Gov. Br. 33. In doing so,
it resorts to case law reviewing agency action for arbitrariness and caprice, rather than the more
searching inquiry required by Central Hudson. Compare id. (quoting Motor Vehicle Mfrs. Ass’n of
U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 52 (1983), with Fox Television Stations,
Inc. v. FCC, 280 F.3d 1027, 1041 (D.C. Cir. 2002) (“first amendment ‘intermediate scrutiny’” is
“more demanding than the arbitrary and capricious standard of the APA”).
Of course, there is no judgment to trust here, as the agency never dealt with the different
usage patterns for premium cigars and what they show about perceptions of health risks among
premium cigar consumers and whether warnings will move those perceptions. Premium cigar
consumers already behave as if they appreciate the health risks of frequent use: Nearly all adults
who use premium cigars do so less frequently than daily, with the median consumer using them just
1.3 to 1.7 days per month. See Sabry et al. at ¶¶ 40-44, tbls.4a-c (Sabry Decl. Ex. 1); Corey et al.
at 5 tbl.2 (Ex. D). And there is no evidence that premium cigar consumers will be moved by the
warnings. Hardly impressionable youth who arguably might miss more subtle reminders, premium
cigar consumers are substantially older, of higher-income, and better-educated than users of other
cigar types or cigarettes. See Sabry et al. at ¶¶ 29-38, tbls.3a-c; Corey et al. at 4 tbl.1, 6 tbl.3. All
15
these differences make litigation counsel’s extrapolation from cigarette or mass-produced cigar
studies unconvincing. And, importantly, while the agency in the rulemaking talked about the health
effects of premium cigars if abused, it never addressed the demographics of premium cigar
consumers nor their usage patterns. See 81 Fed. Reg. at 29,020-22. In fact, the agency’s current
position, in its official pronouncements, is that the differing usage patterns, and their implications
for the necessity of further warnings, require further study. See 83 Fed. Reg. at 12,902-04. Litigation
counsel’s scientific analysis in briefs before this Court is no exercise of the agency’s judgment. See
City of Kansas City, Mo. v. Dep't of Hous. & Urban Dev., 923 F.2d 188, 192 (D.C. Cir. 1991) (“In
whatever context we defer to agencies, we do so with the understanding that the object of our
deference is the result of agency decisionmaking, and not some post hoc rationale developed as part
of a litigation strategy.”). 5
3. The Warnings As Applied to Premium Cigars Are Too Broad in Size

and Scope, Failing Even the Zauderer Test
The warnings reach too far, taking on premium cigars with no evidence to justify their
scope. And they are too big and repetitive, compared against the lack of evidence that they are
needed for premium cigars.
5
Amici are grasping at straws when they cite a supplement to Dr. Corey’s study of PATH data
for the proposition that “nearly one-third (31.4%) of premium cigar smokers smoke them because
they believe premium cigars ‘might be less harmful than cigarettes.’” ECF No. 80 at 21 (quoting
Corey, et. al., at Supplemental Table B). Study participants were restricted to giving “yes” or “no”
answers to whether each of 12 scripted “reasons for why people smoke cigars” applied to them.
Premium cigar users most often (76.6%) endorsed a reason consistent with premium cigars being
an indulgence for special occasions: “I like socializing while smoking them.” There was no
opportunity for the participant to explain, for example, that he believes premium cigars “might be
less harmful than cigarettes” because he only uses premium cigars infrequently. Such a participant
would be correct: Nondaily premium cigar users face no statistically significant increase in
mortality. See Christensen et al. at E1, E6 tbl.3 (Ex. E).
16
Tellingly, the Government’s case is largely dedicated to claiming that the Supreme Court’s
decision in Becerra changed nothing about the Zauderer test. Gov. Br. 28. So the Government
continues its claims that Zauderer requires little more than rational basis review, once the
Government establishes that a warning is “purely factual and uncontroversial.” Gov. Br. 25 &
n.16. But the Supreme Court held that the compelled warnings to which Zauderer applies may
“extend no broader than reasonably necessary” and must “remedy a harm that is potentially real
not purely hypothetical,” and cited First Amendment decisions applying the Central Hudson test
in so doing. See Becerra, 138 S. Ct. at 2377. Justice Breyer, in dissent, observed and criticized
the stronger review, which is a far cry from rational basis. Id. at 2390 (Breyer, J., dissenting).
Certainly, the warnings extend “broader than reasonably necessary” and address a purely
hypothetical harm because they reach premium cigars as a category. When it came to defending
its warnings as applied to premium cigars, the agency abandoned most of its stated justifications
for the warnings in the Rule. The agency had said the warnings were needed to reduce youth
initiation of tobacco use through cigars. See 81 Fed. Reg. at 29,063, 29,064, 29,070. But that is
nowhere to be found in the opposition brief. And appropriately so, as youth use of premium cigars
is so small it cannot be reliably measured. See Kasza et al. at 349, supp. app. at 14 tbl.S4 (Ex. F);
see also Sabry et al. at ¶¶ 25-26, tbl.1 (Sabry Decl. Ex. 1). The agency also had said that warnings
would discourage cigarette smokers from turning to cigars for nicotine delivery. See 79 Fed. Reg.
at 23,146–47; 81 Fed. Reg. at 29,070. But the evidence demonstrates that cigarette smokers use
premium cigars so infrequently that they cannot be the means of feeding a nicotine addiction. See
Sabry et al. at ¶¶ 40-44, tbls.4a-c; Corey et al. at 5 tbl.2 (Ex. D). In defending the application of
the warnings to premium cigars, the Government focuses exclusively on the need to correct
“‘misperceptions’ about the health risks of cigar use.” Gov. Br. 34. But all of the agency’s cited
17
evidence regarding misperceptions of health risks deal with tobacco products other than premium
cigars. Gov. Br. 5-6, 16.
Most importantly, the FDA makes no effort—not in the sections concerning warnings
specifically or in its analysis of whether to exempt premium cigars entirely from the Rule—to
address the different usage and demographic patterns of premium cigars and how that affects the
need for warnings. See 81 Fed. Reg. at 29,020-27, 29,060-72. The Government nowhere remedies
this shortcoming in its briefing before this Court. There is no point to health warnings if they do
not affect behavior. Any effort to narrowly tailor mandated speech that complies with the First
Amendment must take into account the differences of behavior the warnings are trying to change.
The agency’s failure to do so with regard to premium cigars is fatal.
The Government likewise does nothing to justify the extreme size and repetition of the
warnings, as applied to premium cigars. The Government’s effort to claim that the burdens on
premium cigar manufacturers and retailers are less severe than those struck down by the Supreme
Court in Becerra and in the Ninth Circuit’s en banc decision applying Becerra is unconvincing.
Gov. Br. 28-30.
The Government focuses on the higher word count of the California warning struck down
in Becerra. Gov. Br. 29. But California’s demand that unlicensed facilities “call attention to the
notice, instead of its own message, by some method such as larger text or contrasting type or color”
was central to the Court’s ruling that the notice “drowns out the facility’s own message.” See
Becerra, 138 S. Ct. at 2378.
That problem is far worse here: The FDA warnings must cover 30% of the two principal
display panels of each cigar box and 20% of every advertisement, in a stark black-on-white format
set off by a thick rectangular border. See 21 C.F.R. § 1143.5(a)(2), (b)(2). They will appear in a
18
larger font than most of the text on the package or advertisement and in a contrasting type and
color. See id. The California “unlicensed warning” must appear once on the clinic’s exterior and
once in the waiting room. See Becerra, 138 S. Ct. at 2370, 2378. Even modest waiting rooms will
have only a few percent of their space confiscated, the rest left open for the clinic’s message. For
premium cigars, 30 percent of the two panels anyone looks at is gone.
And in a typical retail humidor like those found in En Fuego’s three stores, a random
multitude of all six of the FDA warnings will surround and blare at customers, one from each
premium cigar box, descriptive note on a shelf describing a cigar, and in-store display. See 21
C.F.R. § 1143.5(a), (b). If the warnings in Becerra “drowned out” the speaker’s message, then
surely the FDA’s warnings do the same to the messages of luxury and craftsmanship conveyed by
Plaintiffs’ mahogany premium cigar boxes and retail humidors. See id. at 2378.
That it “is not always the case” that premium cigars are sold in specialty shops is no help
to these Plaintiffs who operate such shops. Gov. Br. 30. It also overlooks the agency’s conclusion
that “premium cigars are typically sold at tobacconists’ shops versus convenience stores.” 79 Fed.
Reg. at 23,151. And the agency failed to calibrate its blunderbuss warnings mandate for particular
retail settings. The Government’s assertion that it is “manufacturers, not retailers, who would
generally place warnings on packages and advertisements,” ignores that the First Amendment is
not concerned only with who bears regulatory compliance costs: Plaintiffs seek to vindicate their
First Amendment rights against being compelled to bombard their customers with the agency’s
message. Gov. Br. 30.
The Government seizes on the Supreme Court’s statement that “we do not question the
legality of health and safety warnings long considered permissible.” Becerra, 138 S. Ct. at 2376.
But there is no reason to believe, as the Government implies, that the Court intended to carve out
19
health and safety warnings from serious scrutiny. Gov. Br. 29. To the contrary, the Court made
this statement to counter the dissent’s claim that “[m]any ordinary disclosure laws would fall
outside the majority’s exceptions for disclosures related to the professional’s own services or
conduct.” Becerra, 138 S. Ct. at 2380 (Breyer J., dissenting). The nature of the disclosures
referenced in that dissent (e.g., “requiring hospitals to tell parents about child seat belts” and
“requiring signs by elevators showing stair locations”) reinforce the conclusion that the Supreme
Court’s statement has no relevance to the massive and repetitive FDA warning scheme at issue
here. See id. at 2380-81.
Consistent with that interpretation, the en banc Ninth Circuit applied Becerra to strike
down just such a health and safety warning as unduly burdensome because the 20% of each
advertisement that it consumed would “drown out” the advertiser’s message, despite leaving the
remaining 80% for private speech. See Am. Beverage Ass’n, 916 F.3d at 757; see also id. at 761
(Ikuta, J., concurring) (“[T]he warning’s size, required font size, contrasting color, and other
requirements contribute to the severity of the warning’s burden.”). The Government leans on San
Francisco’s expert report, showing that a warning covering 10 percent of the advertisement would
improve understanding of the health risks of sugar added beverages and suggesting a smaller
warning would suffice. Gov. Br. 29-30 (citing 916 F.3d at 757). Unlike San Francisco, the FDA
engaged in no analysis of the efficacy of smaller warnings, including those long in place through
the FTC Consent Decree. That lack of inquiry is hardly grounds for salvation. See Thompson v.
W. State Med. Ctr., 535 U.S. 357, 373 (2002) (“If the First Amendment means anything, it means
that regulating speech must be a last—not first—resort.”). 6
6
No part of the Ninth Circuit’s decision was premised, as the Government implies, on a
conclusion that the warning was “not purely factual or controversial.” See Am. Beverage Ass’n,
20
Of course, the failure to study the alternative of the smaller FTC warnings plainly fails the
Central Hudson and strict scrutiny tests. Excuses that a “perfect” fit is not required and that the
“‘least restrictive means’ test has no application” are beside the point. Gov. Br. 34-35. Central
Hudson demands that the Government present “evidence that less restrictive means would fail.”
See Nat’l Ass’n of Mfrs., 800 F.3d at 555; see also Rubin, 514 U.S. at 491 (advertising restrictions
failed Central Hudson given “availability of alternatives that would prove less intrusive”).
Although this Court deemed consideration of the FTC scheme unnecessary under Zauderer, see
Cigar Ass’n, 315 F. Supp. 3d at 171, the same cannot be said under Central Hudson. 7
Absent any serious independent analysis of the warnings’ size, the Government turns to
international consensus and the WHO Framework Convention on Tobacco Control. Gov. Br. 17.
The Government’s rationalization that there is a “consensus built around the research-backed
understanding that larger warnings are more effective” merely begs the question of how large is
large enough, and whether the smaller but still prominent FTC warnings would have achieved the
FDA’s goals. Gov. Br. 36. The en banc Ninth Circuit rejected that same alleged “bigger is better”
consensus, also stemming from the views of international organizations charged with public
health. See Am. Beverage Ass’n, 916 F.3d at 757 (San Francisco had “not carried its burden” when
it relied on evidence that in general “larger warnings are more effective,” and on “best practices”
in the WHO Framework Convention). And that the Rule prescribes warnings in a size “consistent
with what Congress determined to be appropriate for smokeless tobacco” only brings into sharper
916 F.3d at 757 (“We need not, and therefore do not, decide whether the warning here is factually
accurate and noncontroversial.”).
7
For the same reasons, the Government is wrong when it contends that the FDA’s warnings would
“survive even strict scrutiny.” Gov. Br. 26. Strict scrutiny demands that the Government use “the
least restrictive means of achieving a compelling state interest,” which at minimum here required
a study of the FTC scheme’s alleged shortcomings. See McCullen v. Coakley, 573 U.S. 464, 478
(2014).
21
relief that Congress did not determine that cigars (let alone premium cigars) necessitated warnings
of that size or any other. Gov. Br. 34. 8
C. The FDA’s Warning Plan Preapproval System Violates the First Amendment
The Government does not dispute that FDA review of warning plans is only
“contemplated” by the agency to be completed in a “12-month review period,” and is not subject
to any time limit in the Rule. Gov. Br. 40. This alone is fatal to the warning plan requirement.
See FW/PBS, Inc. v. City of Dall., 493 U.S. 215, 226 (1990) (“[A] prior restraint that fails to place
limits on the time within which the decisionmaker must [act] is impermissible.”); Nutritional
Health All. v. Shalala, 144 F.3d 220, 228 (2d Cir. 1998) (“preauthorization scheme would not pass
constitutional muster” without “final deadline”).
That should be the end of the matter. But in the event a Central Hudson analysis were
required, the scheme fails it. The Government must show that alternatives that restrict less speech
than a total ban pending an approval process of indefinite duration are inadequate to satisfy the
“need for rotation” (Gov. Br. 39) that it asserts. See Nat’l Ass’n of Mfrs., 800 F.3d at 555 (“The
government cannot satisfy [Central Hudson] if it presents no evidence that less restrictive means
would fail.”). The agency’s unsupported assertions that this scheme will help it “conduct
surveillance and inspection” and educate “businesses that are unfamiliar with rotation” do not
suffice to show the inadequacy of the obvious alternative of mandating rotation and then enforcing
compliance as necessary. Gov. Br. 39. And the agency offers no justification for why it is
8
Discount Tobacco City & Lottery, Inc. v. United States does not require a different conclusion.
See 674 F.3d 509 (6th Cir. 2012) (cited at Gov. Br. 34). In rejecting a facial challenge to larger
cigarette and smokeless tobacco warnings when applying Zauderer (not Central Hudson), the
Sixth Circuit was presented with a record of cigarette and smokeless tobacco warnings that had
“not been revised” since the 1980s, and were “easily overlooked.” Id. at 563. And the Sixth
Circuit’s characterization of Zauderer as no more than a “rational-basis rule” is not good law after
Becerra, if it ever were. See Discount Tobacco, 674 F.3d at 564.
22
necessary to prohibit retailers from speaking to consumers for twelve months or more merely so
that the FDA can approve a mechanical rotation plan. This task is nothing like the FDA’s scientific
process for “evaluating, pursuant to defined standards, whether commercial health claims are
truthful and non-misleading” to “protect consumers before any harm occurs,” which the Second
Circuit found justified a limited prior restraint of up to 540 days. See Nutritional Health All., 144
F.3d at 228.
None of the Government’s other attempts to avoid or delay Plaintiffs’ prior restraint
challenge is persuasive.
First, the Government asserts that this challenge is “unripe” because Plaintiffs can continue
to speak until the compliance deadline expires. Gov. Br. 40. But there is no authority holding that
a plaintiff like En Fuego must submit an application and wait until “speech has actually been
delayed” (Gov. Br. 38) before it may challenge an unconstitutional prior restraint. See Nutritional
Health All., 144 F.3d at 227 (challenge “clearly ripe” despite that plaintiffs had not yet submitted
preclearance applications to the FDA); Hunt v. City of L.A., 638 F.3d 703, 718 (9th Cir. 2011)
(“the necessary injury in fact is the threat of the prior restraint”). And the Government’s demand
that En Fuego specify the “covered product that it wishes to advertise” (Gov. Br. 37) overlooks
the sworn declaration describing the “modes of advertising” through which it communicates with
customers about the constantly changing premium cigar “brands and blends” it sells, and
explaining that En Fuego cannot “know which cigar brands we will be advertising or marketing
one year from now.” Moore Decl. ¶¶ 2, 6-12, 16-17.
Second, that the FDA has in two cases approved applications for a “generic warning plan”
with a “single rotation schedule for ‘all brands’” only shows that the agency knows there is a
problem. Gov. Br. 38. These potential acts of grace neither guarantee the same treatment to other
23
applicants nor change the foreboding text of the Rule requiring a warning plan as to “each brand
of cigar.” 21 C.F.R. § 1143.5(c). Regulations violating the First Amendment are not saved
“merely because the Government promised to use [them] responsibly.” United States v. Stevens,
559 U.S. 460, 480 (2010). For the same reason, the FDA’s assertion that it has “promptly
processed” some of the applications it has received to date and would “consider” adopting an
unspecified “compliance policy” to avoid hardship do not matter. Gov. Br. 38.
Third, the prior restraint doctrine’s safeguards cannot be ignored merely because Plaintiffs
are engaged in commercial speech. Gov. Br. 38-39. Although the D.C. Circuit has held the
question open, Pearson v. Shalala, 164 F.3d 650, 660 & n.11 (D.C. Cir. 1999), several other circuit
courts have rejected an exception to prior restraint law for commercial speech. See N.Y. Magazine
v. MTA, 136 F.3d 123, 131 (2d Cir. 1998) (“no reason why the requirement of procedural
safeguards should be relaxed whether speech is commercial or not”); see also Nutritional Health
All., 144 F.3d at 227; Desert Outdoor Adver., Inc. v. City of Moreno Valley, 103 F.3d 814, 818
(9th Cir. 1996); In re Search of Kitty’s E., 905 F.2d 1367, 1371 (10th Cir. 1990); U.S. Postal Serv.
v. Athena Prods., 654 F.2d 362, 367 (5th Cir. 1981). Likewise, that the warning plan scheme
“mirrors” one imposed on smokeless tobacco but apparently never challenged does not exempt the
Rule from prior restraint scrutiny. Gov. Br. 39.
II. THE APPLICATION OF THE WARNINGS TO PREMIUM CIGARS IS

ARBITRARY AND CAPRICIOUS
A. The FDA’s Enforcement of the Warnings on Premium Cigars, Despite the

Agency’s Open Rulemaking Proceedings Seeking to Change the Rule for
Premium Cigars, Is Arbitrary and Capricious
The FDA’s baffling refusal to defer enforcement of the warnings while it reconsiders their
application to premium cigars is not only “grossly unfair,” as this Court concluded, but is also
indefensible under the APA. Cigar Ass’n, 315 F. Supp. 3d at 175.
24
As an initial matter, Plaintiffs are challenging the decision to enforce the warnings
requirement against premium cigars before the resolution of the premium cigar rulemaking
docket. The Government is correct that unregulated industries could not challenge the “refusal to
take requested enforcement action” and would face a “presumption of unreviewability.” See
Heckler v. Chaney, 470 U.S. 821, 831, 833 (1985) (cited at Gov. Br. 44, 46). But a regulated entity
can challenge the agency’s decision to enforce a regulatory requirement. This is especially so
here, where the FDA fails to explain its decision to go forward with warnings enforcement against
premium cigars, while extending other future deadlines for provisions that may be changed by
pending rulemaking proceedings.
Both the product review and health warning compliance deadlines had yet to arrive; both
sets of requirements portended massive compliance costs; and both were the subject of the
premium cigar rulemaking that would alter and eliminate these requirements for premium cigars.
The agency’s decision to enforce the warnings requirement while this rulemaking was pending is
unexplained and arbitrary.
It is not credible to suggest that the agency’s premium cigars rulemaking is somehow less
serious than its rulemaking concerning the product review process. Gov. Br. 43-44. When it
opened the premium cigars docket, the FDA explained that “the regulatory considerations with
respect to premium cigars, their use, and related public health issues” are “a topic of ongoing and
emerging research,” and that the agency’s purpose is nothing less than to “consider the appropriate
regulatory status of premium cigars.” See 83 Fed. Reg. at 12,902. Indeed, the agency sought
comments on the consequences were it “to exempt premium cigars from regulation or to regulate
premium cigars differently from other cigars.” Id. at 12,903. And it is expressly addressing the
appropriateness of enforcing the warnings against premium cigars. Id. at 12,903-04. The FDA’s
25
subsequent statements give no reason to doubt that it meant what it said when it opened the
premium cigars docket. Take Commissioner Gottlieb: “It is true that we are revisiting the rule that
deemed premium cigars ‘tobacco products’ subject to all the same regulation as, let’s say,
cigarettes.” CNBC Squawk Box (May 15, 2018) (emphasis added). 9 Similarly, the FDA asked
this Court to dismiss certain claims and stay judicial proceedings in the Cigar Association case
“because those announced regulatory actions may materially change the regulatory scheme.” See
Cigar Ass’n, 315 F. Supp. 3d at 157.
Thus the premium cigars rulemaking notice cannot be fairly characterized as “no more than
a broadly stated request for information and comment.” See P&V Enters. v. U.S. Army Corps. Of
Eng’rs, 516 F.3d 1021, 1024-25 (D.C. Cir. 2008) (cited at Gov. Br. 44). Regardless, here the
Government began reconsidering the warnings before their enforcement had even begun, while in
PV Enters. the challenged rule had been in force for nearly 20 years when the ANPRM was issued.
See id. For this reason, this is different from situations where courts have held that an agency
“remains bound by the existing rule until that rule is amended or revoked.” Gov. Br. 47.
The Government’s defense that the agency “left the compliance periods for the vast
majority of TCA provisions unchanged” is no help. Gov. Br. 46. Unlike health warnings for
premium cigars, those other provisions (e.g., mandatory age and photo-ID checks, removal of
modified risk claims) are not the expressly listed subject of pending rulemakings and several of
them were already in force at that time. And the Government is wrong when it claims that this
unexplained internal inconsistency is of no moment because “all parties have been treated the
same.” Gov. Br. 47. The agency is not treating premium cigar manufacturers and retailers the
9
Available at https://archive.org/details/CNBC_20180515_100000_Squawk_Box/start/7860/end
/7920.
26
same as other similarly situated regulated entities: For some regulated entities the FDA has
deferred all of the upcoming compliance deadlines that are implicated by pending rulemaking
proceedings that may change applicable rules, but it has refused to do the same for the premium
cigar industry, for which the agency is expressly considering elimination of or changes to the
warnings requirement.
B. The FDA’s Imposition of the Warnings on Premium Cigars Was Arbitrary

and Capricious
The FDA’s decision to extend the warnings requirement to premium cigars in the first
instance also was the product of inconsistent and flawed reasoning in several respects.
First, the agency wrongly assumed that applying warnings to premium cigars must follow
the decision to “deem” all cigars subject to the Act, as night follows day. See 79 Fed. Reg. at
23,162, 23,165; 81 Fed. Reg. at 29,026, 29,060. The Government contends that scattered
statements in response to comments concerning e-cigarettes and dissolvable tobacco products
show that “the agency fully understood that its authority to deem products . . . was distinct from
its authority to impose . . . the health warnings.” Gov. Br. 48 (citing 81 Fed. Reg. at 28,982-83,
29,056). But those isolated statements concerning other tobacco products do not purport to explain
why the agency subjected premium cigars to the same warnings as all other cigars. Instead, the
sole explanation the agency offered for that decision was that it was statutorily required: “FDA
has selected Option 1, which requires all cigars (rather than a subset) to include the textual health
warnings.” 81 Fed. Reg. at 29,026 (emphasis added). It was arbitrary and capricious for the FDA
erroneously to assume that the discretionary act of extending the warnings to premium cigars, was
a mandatory consequence of selecting Option 1 and deeming premium cigars “subject to the Act.”
See Arizona v. Thompson, 281 F.3d 248, 259 (D.C. Cir. 2002). The Court should vacate the
warnings mandate as applied to premium cigars and remand to the agency to consider, through
27
notice and comment rulemaking, whether to exercise its discretion to extend the warnings mandate
to premium cigars. This is the right remedy when an agency assumes a regulation is statutorily
required from some other decision it made, especially when that regulation has yet to take effect.
See Noble Energy, Inc. v. Salazar, 671 F.3d 1241, 1246 n.5 (D.C. Cir. 2012) (vacating and
remanding “when an agency incorrectly concludes that Congress mandated” a course of action).
Second, the agency’s scientific explanation for why the warnings requirement should
extend to premium cigars was inadequate, failed to address differences in the demographics of
premium cigar consumers and the frequency with which premium cigars are used, and primarily
relied on evidence and anecdotes of tobacco products other than premium cigars. See 81 Fed. Reg.
at 29,062, 29,069-72; Humane Soc’y of U.S. v. Zinke, 865 F.3d 585, 606 (D.C. Cir. 2017) (“[A]
failure to address ‘an important aspect of the problem’ that is factually substantiated in the record
is unreasoned, arbitrary, and capricious decisionmaking.”). In response, the Government leans on
the agency’s discussion of its reasons for rejecting “Option 2,” which would have carved out
premium cigars from the decision to “deem” all cigars subject to the Act. See Gov. Br. 42-43
(citing 81 Fed. Reg. at 29,020). But that discussion never addressed the issues pertaining to the
application of the warnings to premium cigars, let alone why premium cigars needed warnings that
were so large that they covered 30 percent of the two most prominent package panels.
As important, the agency’s analysis of rejecting Option 2 focused only on whether
premium cigars also imparted toxicants and thus were harmful generally speaking. See 81 Fed.
Reg. at 29,020-27. The agency never analyzed the behavior of premium cigar consumers, in
particular the infrequency with which they use the product. For reasons arising solely from its
failure to support the cigarette warnings against judicial challenge, the agency strategically
disclaims any interest in reducing smoking rates through the warnings. After all, when it studied
28
the effect of massive warnings on cigarette packages, it found that they would lead to only a 0.088
percent decrease in cigarette smoking nationwide. See R.J. Reynolds, 696 F.3d at 1220. But
whether the warnings will affect behavior is clearly an important aspect of the problem. See State
Farm Mut. Auto. Ins. Co., 463 U.S. at 43 (agency rule arbitrary and capricious where it “failed to
consider an important aspect of the problem”). And, with regard to premium cigars, that question
turns on how premium cigar consumers are behaving currently, especially the extremely low
frequency with which they use the product.
Third, the FDA bypassed any serious weighing of the costs and the benefits of extending
the warnings to premium cigars. By the agency’s own reckoning those costs would be enormous:
The FDA estimates that a single premium cigar manufacturer with 1,670 unique products would
spend between $2.5 million and $27.8 million. See AR130285–86, AR024019. The Government
pats the FDA on the back for having “described the expected costs of the . . . health warnings, on
the cigar industry.” Gov. Br. 48. But that leaves out half of the cost-benefit equation and ignores
that the agency conceded that it has no “[r]eliable evidence” that the warnings would have a
tangible effect on the use of any cigars, premium or otherwise. AR023973. Beyond that
long-standing concession with regard to all cigars, we now know that the agency is really only
defending the need for warnings on premium cigars by the need to change the behavior of the
small percentage of premium cigar consumers who use the product daily. Remember, in the most
recent PATH study data, that is 3.5 percent of premium cigar consumers, who themselves
constitute 0.48 percent of American adults, or at most 43,000 Americans. With the amount of
money the premium cigar industry will have to spend redesigning their packages and advertising
(for 20,000 separate branded product types), the agency could have sent a team to sit in the living
29
room of every affected citizen and ensure that he fully appreciates the risks of daily premium cigar
use.
That the agency embarked on a cost-benefit analysis and did not consider this aspect of the
costs being imposed on the small businesses populating the premium cigar industry renders the
application of warnings to premium cigars arbitrary and capricious. The Government’s suggestion
that such evidence was unnecessary because it was not mandated by statute overlooks the APA,
which provides that “when an agency decides to rely on a cost–benefit analysis as part of its
rulemaking, a serious flaw undermining that analysis can render the rule unreasonable.” Nat’l
Ass’n of Home Builders v. EPA, 682 F.3d 1032, 1040 (D.C. Cir. 2012).
C. The FDA’s Failure to Make the Requisite Statutory Findings Specific to

Premium Cigars Renders the Rule “Contrary to Law” in Violation of the
APA and the Family Smoking Prevention Act
Even if the FDA had made general findings that imposing a warnings requirement will
reduce tobacco use, it was required to, but did not, make specific findings as to the distinct tobacco
product category of premium cigars.
The Government’s contention that the FDA “did, in fact, explain why including the
warnings on premium cigars is appropriate for the public health,” is belied by the administrative
record. Gov. Br. 41. It does not dispute that the findings on which this Court relied “specific to
the importance and efficacy of the health warnings” related to cigars or tobacco products generally;
not to premium cigars in particular. See Cigar Ass’n, 315 F. Supp. 3d at 160. Instead, the
Government points to agency findings in support of its exercise of authority under Section 901 of
the FD&C Act to “deem” all cigars subject to the Act. See Gov. Br. 42 (citing 81 Fed. Reg. at
29,020-27). But it is Section 906 of the FD&C Act that empowers the Secretary to impose a
warnings requirement on premium cigars after making findings that doing so will reduce tobacco
use. See FD&C Act § 906(d)(1), 21 U.S.C § 387f(d)(1). That the agency supposedly “catalogued
30
the many ‘health risks of premium cigars’” in its deeming decision is no substitute for its failure
to make the findings as to reduction of tobacco use that Congress demanded before imposing
warnings on premium cigars. Gov Br. 42 (quoting 81 Fed. Reg. at 29,020).
To assert that premium cigars have not even been “recognized . . . as a distinct subcategory
of products” flies in the face of the agency’s actions. Gov. Br. 40. Not only did the agency
recognize that premium cigars are distinct when proposing the Rule, but it has reaffirmed that
judgment with its pending premium cigars rulemaking docket. See 79 Fed. Reg. at 23,150; 83 Fed.
Reg. at 12,902-04. And the Government’s claim that Section 906(d)(1) of the FD&C Act may be
satisfied with “findings applicable to general categories of products” (Gov. Br. 41) cannot be
reconciled with the careful language chosen by Congress. See FD&C Act § 906(d)(1), 21 U.S.C
§ 387f(d)(1) (before imposing warnings on “a tobacco product,” agency must make mandated
finding with respect to “users and nonusers of the tobacco product”) (emphases added). That
Congress referred broadly elsewhere in the Act to “other tobacco products” or to “all cigars” only
reinforces that its choice of more focused language in Section 906(d)(1) was deliberate. See Gov.
Br. 41 (quoting 21 U.S.C. §§ 387a(b), 387g(b)(3)(A)).
III. THE ISSUANCE OF THE FDA’S FINAL RULE VIOLATED THE

CONSTITUTION’S APPOINTMENTS CLAUSE
A. Plaintiffs Have Not Waived Their Appointments Clause Claim
The Government is mistaken when it asserts that Plaintiffs were required to raise their
Appointments Clause claim during the rulemaking comment process and, by failing to do so,
waived their right to pursue that claim in this Court. Gov. Br. 50-51. In Estes v. U.S. Dep’t of the
Treasury, the Treasury Department presented the same argument pressed by the Government here:
that the employee’s signature on the proposed rule triggered the plaintiffs’ obligation to object to
that employee’s lack of constitutional authority to issue the final rule. See 219 F. Supp. 3d 17, 37
31
(D.D.C. 2016) (cited at Gov. Br. 51). The court, in turn, correctly held that “where Plaintiffs’
challenge rests on the promulgating official’s identity, which was only announced with the Rule’s
issuance,” the plaintiffs were not required to raise their Appointments Clause claim prior to the
issuance of the final rule-at-issue. Id.; see also Tesoro Alaska Co. v. FERC, 778 F.3d 1034, 1041
n.7 (D.C. Cir. 2015) (addressing claims not raised before agency where “each of the claims raised
deal[t] with [the agency’s] treatment of evidence or reasoning in its final opinion” and thus could
not have been raised until the agency issued its final rule). It was not Plaintiffs’ burden to warn
the agency of then-hypothetical unconstitutional agency action before it occurred; rather, it was
incumbent on the FDA to act in accordance with the Constitution and laws of the United States.
Nor is there any support for the Government’s assertion that Plaintiffs somehow waived
their Appointments Clause claim by failing to assert it prior to the amended complaint. To the
contrary, courts in this district expressly have permitted Appointments Clause claims to go forward
even when such claims potentially could have been included in an initial pleading. See Associated
Mortg. Bankers Inc. v. Carson, 2017 WL 6001733, at *6 (D.D.C. Dec. 1, 2017) (“The Court
recognizes that plaintiff could have raised the Appointments Clause claim in its first complaint . . .
However, defendants do not explain what prejudice would result from allowing an amendment to
add this claim.”). The Government identifies no prejudice here from the timing of the amendment
that could possibly warrant depriving Plaintiffs of their claim.
B. The Deeming Rule Was Not Issued by a Properly Appointed Officer of the
United States
The Government’s argument that the individual who signed the Deeming Rule, Leslie Kux,
was appointed in accordance with the Appointment Clause fails for two reasons.
First, the Associate Commissioner for Policy position held by Ms. Kux is one that must be
occupied by a principal officer. The position exercises unrestricted and unsupervised discretion
32
to issue rules with broad impact on the general public. See FDA Staff Manual § 1410.21 (Ex. J).
Such unsupervised authority to issue sweeping regulations may only be exercised by a principal
officer of the United States, such as the Commissioner or Secretary. See Assn’ of Am. R.R. v. U.S.
Dep’t of Transp., 821 F.3d 19, 38-39 (D.C. Cir. 2016) (arbitrator appointed by Safety
Transportation Board could not issue a final legislative rule because his conduct was not overseen
by a supervising principal officer). As there is no dispute that Ms. Kux was not appointed by the
President and confirmed by the Senate, she was not a duly appointed principal officer and lacked
authority to issue the Rule.
Second, even if an inferior officer could permissibly issue the Rule, Ms. Kux was not an
inferior officer either. As the Government acknowledges, Ms. Kux’s appointment was
constitutionally sound only if Congress “by law” authorized the Secretary to appoint inferior
officers. Gov. Br. 54. But Congress has not done so. The two statutes cited by the Government
do not. The first, 21 U.S.C. § 393(d)(2), provides the Secretary with general powers to oversee
the policies and management of the agency, which the FDA argues is analogous to the statute
addressed in Edmond v. U.S., 520 U.S. 651, 656 (1997). But unlike that statute, which expressly
provided the Transportation Secretary the authority to “appoint and fix the pay of officers,”
Section 393(d)(2) of Title 21 contains no reference to the Secretary or Commissioner’s authority
to appoint anyone, let alone inferior officers of the United States. Compare 21 U.S.C. § 393(d)(2),
with 49 U.S.C. § 323(a) (emphases added). Other statutes provide for the appointment of inferior
officers with similar language to that addressed in Edmond. See, e.g., 7 U.S.C. § 610(a)
(Agriculture Secretary “may appoint such officers and employees, . . . and such experts, as are
necessary to execute the functions vested in him”); 20 U.S.C. § 3461(a) (Education Secretary “is
authorized to appoint and fix the compensation of such officers and employees, including
33
attorneys, as may be necessary to carry out the functions of the Secretary and the Department”).
Indeed the immediately preceding provision—Section 393(d)(1)—sets forth the appropriate
procedure for appointing the Commissioner, and illustrates that Congress is fully capable of
unambiguously identifying who possesses appointment authority. The glaring omission of any
analogous language in Section 393(d)(2) shows that it does not provide the Secretary or
Commissioner with the authority they claim.
The second, 5 U.S.C. § 302(b), also does not provide the Secretary (or any other agency
head) with the authority to appoint inferior officers. Section 302(b) is a general housekeeping
statute which permits all agency heads to delegate their authority, but like Section 393(d)(2) it
lacks any reference to the vesting of appointment authority. Further, reading this housekeeping
statute to provide for broad appointment power “would threaten to swallow up the statutory
appointment schemes enacted for various agencies,” and strip the Appointments Clause of all
meaning. United States v. Concord Mgmt., 317 F. Supp. 3d 598, 622 (D.D.C. 2018).
C. Ratification Has Not Cured the Appointments Clause Defect
Finally, the outgoing Commissioner’s purported ratification does not cure the
Appointments Clause defect. Unlike the Attorney General’s ratification in Guedes v. Bureau of
Alcohol, Tobacco, Firearms and Explosives, the Commissioner’s attempted ratification here
makes no reference to any effort to “independently reevaluate” the Rule or “the underlying
rulemaking record.” See 920 F.3d 1, 9 (D.C. Cir. 2019) (cited at Gov. Br. 52). Nor does the
Commissioner indicate he has “familiarized [him]self with the rulemaking record” or “reevaluated
those materials without any deference to [the] earlier decision.” Id. at 12. 10 Instead, the
10
The ratification in Alfa Int’l Seafood v. Ross similarly reflected that the Secretary of Commerce
had apprised himself of the “contents, purpose, and requirements of the Final Rule and its
supporting documents.” 264 F. Supp. 3d 23, 43 (D.D.C. 2017) (emphasis added).
34
Commissioner’s ratification is premised on his “review of the rule,” his “knowledge of its
provisions,” and his “close involvement in policy matters” related to the Deeming Rule. APP 231.
While the Commissioner may agree with the underlying policy decision, the APA requires more.
Under the APA, agencies must consider public comment and the entire administrative record
before issuing a rule. 5 U.S.C. § 533. Reviewing the final rule itself is not a substitute for review
and consideration of the rulemaking record without deference to the employee’s prior decision.
See Guedes, 920 F.3d at 12. As the FDA acknowledges, “a central aim of the Appointments Clause
is to ensure accountability.” Gov. Br. 56. Proper adherence to the strictures of the Appointments
Clause and APA are critical to protecting these aims. The Commissioner’s attempted ratification,
however, sidestepped those protections and should not be granted any legal effect.
IV. PLAINTIFFS’ CLAIMS ARE NOT BARRED BY RES JUDICATA
The doctrine of res judicata does not apply. None of the Plaintiffs has ever been a party to
Cigar Association and the Government cannot overcome “the general rule that a litigant is not
bound by a judgment to which she was not a party.” See Taylor v. Sturgell, 553 U.S. 880, 892-93
(2008). In any event, this Court explicitly held that premium cigar issues were not presented or
being decided when it previously evaluated the warnings requirement. See Cigar Ass’n, 315
F. Supp. 3d at 157, 166. Claims regarding premium cigars brought by the plaintiffs in Cigar
Association are currently stayed, on the Government’s request. The idea that res judicata would
apply to premium cigar claims that this Court held was not before it in its prior ruling and were
stayed for future adjudication is entirely without merit. This Court should reject the Government’s
effort to jam this case into a series of incomplete quotes from inapposite cases about the res
judicata doctrine.
The Government’s assertion that “Plaintiffs here are members or close affiliates of either
IPCPR or CRA” is both inaccurate and irrelevant. Gov. Br. 13. Plaintiffs En Fuego and El Cubano
35
are not now, and were not when this case was filed, members of IPCPR or CRA. ECF No. 23-1
at ¶¶ 2-3; ECF No. 23-2 at ¶¶ 2-3. That an IPCPR member page last updated in 2017 named those
Plaintiffs, or that En Fuego described itself as a member of CRA in a social media post in 2015,
merely reflects their historical membership in those trade associations. Gov. Br. Exs. B-D.
Plaintiff TxCMA, for its part, is an independent not-for-profit association incorporated in Texas,
whose Board of Directors is elected by its membership and shares no common members with the
board of directors of the IPCPR. ECF No. 23-3 at ¶¶ 2-3.
Regardless, “mere membership” in an association is insufficient to bind members to
litigation undertaken by the association. See, e.g., Cal. Cosmetology Coal. v. Riley, 871 F. Supp.
1263, 1267 (C.D. Cal. 1994), aff’d, 110 F.3d 1454 (9th Cir. 1997). Instead, there must be evidence
that the member authorized or controlled the litigation. See id. (collecting cases); see also 18A
Charles Alan Wright et al., Federal Practice & Procedure § 4456 (2d ed. 2017) (members who
did not “actively participate[]” in prior action “should not be precluded”). The Government has
produced no such evidence here. Even when they were members of IPCPR, En Fuego and El
Cubano were just two out of more than two-thousand IPCPR members nationwide, and were not
active in its leadership or management, much less in control of the litigation in Cigar Association.
ECF No. 23-1 at ¶ 4; ECF No. 23-2 at ¶ 4. Similarly, TxCMA did not authorize IPCPR to
represent it in Cigar Association and did not have any role at all in that litigation. ECF No. 23-3
at ¶ 5.
The Government’s reliance on Western Coal Traffic League v. ICC is misplaced. 735 F.2d
1408 (D.C. Cir. 1984) (cited at Gov. Br. 14). The plaintiff in that case was “a member of a trade
association . . . , that actively participated in the prior adjudication,” not a former member that
36
exercised no control over the earlier litigation. Id. at 1411. 11 And the D.C. Circuit emphasized
there that the plaintiff “offers no argument distinct from [the trade association’s] contentions, and
points to no inadequacy in [the association’s] presentation of issues of concern to shippers situated
as [plaintiff] is.” Id. That is not the case here. Plaintiffs En Fuego and El Cubano are local
businesses differently situated from the largest cigar manufacturers in the United States who are
party to the FTC Consent Decree that mandates warnings bearing the same content prescribed by
the FDA. Plaintiffs bring claims not asserted in Cigar Association including a challenge to the
FDA’s warnings as “not purely factual and controversial” when applied to premium cigars.
Alternatively, the Government contends that “even if Plaintiffs were not members or
affiliates” of the Cigar Association plaintiffs, they either were “‘adequately represented’” by them
or were their “‘prox[ies].’” Gov. Br. 14 (quoting Taylor, 553 U.S. at 894). The Government fails
to show that either of those “discrete exceptions that apply in limited circumstances” pertains to
this case. See Taylor, 553 U.S. at 898. The “adequate representation” exception is intended for
“properly conducted class actions” and for “suits brought by trustees, guardians, and other
fiduciaries,” where there is a court-supervised legal duty to act in the absent parties’ best interest.
Id. at 894. The “proxy” exception to the general rule limiting preclusion to actions brought by
identical parties is no more relevant: It applies only “when a person who did not participate in a
litigation later brings suit as the designated representative of a person who was a party to the prior
adjudication.” Id. at 895.
11
The rest of the trio of ICC cases cited by the Government are inapposite for the same
straightforward reason. See Aluminum Co. of Am. v. ICC, 761 F.2d 746 (D.C. Cir. 1985)
(“Reynolds and Alcoa are both members of the Aluminum Association”); Utah Power & Light
Co. v. ICC, 764 F.2d 865, 871 (D.C. Cir. 1985) (“Utah Power and Light Company . . . is one of
[the trade association’s] members”).
37
An independent defect in the Government’s res judicata argument is that the doctrine “does
not bar parties from bringing claims based on material facts that were not in existence when they
brought the original suit.” Apotex, Inc. v. FDA, 393 F.3d 210, 218 (D.C. Cir. 2004) (cited at Gov.
Br. 11); see also Drake v. FAA, 291 F.3d 59, 66 (D.C. Cir. 2002) (res judicata not applicable where
“many of the central events underlying [the second action] had not even taken place . . . when
[plaintiff] instigated [the first]”). Here, Plaintiffs’ First Amendment claim challenging the
warnings as misleading and incomplete when applied to premium cigars is based on scientific
studies published after Cigar Association commenced. ECF No. 20 at ¶¶ 64-72. And information
in those studies infuses the analysis of whether the warnings’ vast size and repetition survive the
strict scrutiny, Central Hudson, or Zauderer test, whichever is applicable, which all turn on the
need for the compelled speech and whether it effectively addresses that need. Likewise, Plaintiffs’
claim that the agency acted arbitrarily and capriciously by insisting that the warnings go into effect,
while reconsidering whether premium cigars should be regulated differently or at all, is based in
part on the ANPRM that was not issued by the FDA until March 2018. See ECF No. 20 at
¶¶ 115-29; 83 Fed. Reg. 12,901. This Court concluded that neither such claim was presented in
Cigar Association. See Cigar Ass’n, 315 F. Supp. 3d at 166, 176.
The same defects are fatal to the Government’s “claim splitting” (Gov. Br. 15) argument.
See Katz v. Gerardi, 655 F.3d 1212, 1218 (10th Cir. 2011) (“The proper question [on a claim
splitting argument] is whether, assuming the first suit was already final, the second suit would be
precluded under res judicata analysis.”) (cited at Gov. Br. 15). That argument was also waived.
The Government waited to assert its “claim splitting” defense until more than eight months had
passed from the commencement of this action (ECF No. 72 at 26), when both actions were before
the same Judge (this Court) and thus the claims were no longer “split.” See Rotec Indus., Inc. v.
38
Mitsubishi Corp., 348 F.3d 1116, 1119 (9th Cir. 2003) (“There is no reason to allow litigants to
delay objecting to dual proceedings until they receive a favorable judgment in one proceeding.”);
Devlin v. Transp. Commcn’s Int’l Union, 175 F.3d 121, 130 (2d Cir. 1999) (vacating judgment of
claim preclusion where plaintiff had split claims between two actions but “the same district judge
had both [actions] on his active docket at the same time”). Moreover, the claims brought herein
concern premium cigars, and the premium cigar claims from the original case are currently stayed
and have not been advanced. See Cigar Ass’n ECF No. 127. These are not the circumstances for
which the claim splitting principles were designed. These Plaintiffs are entitled to an adjudication
of their claims on the merits.
CONCLUSION
For the foregoing reasons, Plaintiffs respectfully request that the Court grant Plaintiffs’
motion for summary judgment, grant the relief requested in Plaintiffs’ opening brief, and deny the
Government’s cross-motion for summary judgment in its entirety.
39
Dated: June 3, 2019 Respectfully submitted,
/s/ Michael J. Edney

NORTON ROSE FULBRIGHT US LLP
Michael J. Edney
D.C. Bar No. 492024
michael.edney@nortonrosefulbright.com
799 9th Street NW, Suite 1000
Washington, DC 20001-4501
Telephone: (202) 662-0200
Facsimile: (202) 662-4643
SIEBMAN FORREST BURG & SMITH, LLP

Clyde M. Siebman
Texas Bar No. 18341600
clydesiebman@siebman.com
Elizabeth S. Forrest
Texas Bar No. 24086207
elizabethforrest@siebman.com
Federal Courthouse Square
300 N. Travis Street
Sherman, TX 75090
Telephone: (903) 870-0070
Facsimile: (903) 870-0066
Counsel for Plaintiffs En Fuego Tobacco Shop

LLC, Cuba Libre Enterprises LLC, and Texas
Cigar Merchants Association
40

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Case 1:16-cv-01460-APM Document 129 Filed 06/04/19 Page 1 of 47

IN THE UNITED STATES DISTRICT COURT

CIGAR ASSOCIATION OF AMERICA, et al., )

REPLY IN FURTHER SUPPORT OF PLAINTIFFS’ MOTION FOR SUMMARY

Dated: June 3, 2019 Michael J. Edney, DC Bar No. 492024

Clyde M. Siebman, Texas Bar No. 18341600

Counsel for Plaintiffs

B. The Deeming Rule Was Not Issued By A Properly Appointed

Alfa Int’l Seafood v. Ross,

Aluminum Co. of Am. v. ICC,

*Am. Beverage Ass’n v. City & Cty. of S.F.,

Am. Meat Inst. v. U.S. Dep’t of Agriculture,

Apotex, Inc. v. FDA,

Assn’ of Am. R.R. v. U.S. Dep’t of Transp.,

Associated Mortg. Bankers Inc. v. Carson,

Bellion Spirits, LLC v. United States,

Cal. Cosmetology Coal. v. Riley,

Cigar Ass’n v. FDA,

City of Kansas City, Mo. v. Dep't of Hous. & Urban Dev.,

*CTIA—The Wireless Ass’n v. City & Cty. of S.F.,

Desert Outdoor Adver., Inc. v. City of Moreno Valley,

Devlin v. Transp. Commcn’s Int’l Union,

Discount Tobacco City & Lottery, Inc. v. United States,

Estes v. U.S. Dep’t of the Treasury,

Fox Television Stations, Inc. v. FCC,

FW/PBS, Inc. v. City of Dall.,

Guedes v. Bureau of Alcohol, Tobacco, Firearms and Explosives,

Humane Soc’y of U.S. v. Zinke,

Hunt v. City of L.A.,

Inst. of Marine Mammal Studies v. Nat’l Marine Fisheries Serv.,

Jarita Mesa Livestock Grazing Ass’n v. U.S. Forest Serv.,

Lorillard Tobacco Co. v. Reilly,

N.Y. Magazine v. MTA,

*Nat’l Ass’n of Home Builders v. EPA,

*Nat’l Ass’n of Mfrs. v. SEC,

*Nat’l Ass’n of Wheat Growers v. Zeise,

*Nat’l Inst. of Family & Life Advocates v. Becerra,

Nat’l Med. Enters., Inc. v. Shalala,

Noble Energy, Inc. v. Salazar,

Nutritional Health All. v. Shalala,

P&V Enters. v. U.S. Army Corps. Of Eng’rs,

*R.J. Reynolds Tobacco Co. v. FDA,

Robbins v. U.S. Bureau of Land Mgmt.,

Rotec Indus., Inc. v. Mitsubishi Corp.,

Rubin v. Coors Brewing Co.,

In re Search of Kitty’s E.,

Tesoro Alaska Co. v. FERC,

Thompson v. W. State Med. Ctr.,

U.S. Postal Serv. v. Athena Prods.,

United States v. Concord Mgmt.,

United States v. Stevens,

Utah Power & Light Co. v. ICC,

Western Coal Traffic League v. ICC,

Zauderer v. Office of Disciplinary Counsel of Supreme Ct. of Ohio,

Statutes, Rules, and Regulations

5 U.S.C. § 302 ................................................................................................................................34

5 U.S.C. § 533 ................................................................................................................................35

7 U.S.C. § 610 ................................................................................................................................33

20 U.S.C. § 3461 ............................................................................................................................33

49 U.S.C. § 323 ..............................................................................................................................33

21 C.F.R. § 1143 ..........................................................................................................10, 18, 19, 24

Proposed Rule, Deeming Tobacco Products to Be Subject to the Federal Food,

opposition to the Government’s cross-motion for summary judgment.