Lorillard, Inc. v. U.S. Food & Drug Admin.

• Decision Date: 21 July 2014
• Docket Number: Civil Case No. 11–440 RJL
• Citation: 56 F.Supp.3d 37
• Parties: Lorillard, Inc., et al., Plaintiffs, v. United States Food and Drug Administration, et al., Defendants.
• Court: U.S. District Court — District of Columbia

56 F.Supp.3d 37

Lorillard, Inc., et al., Plaintiffs

v.United States Food and Drug Administration, et al., Defendants.

Civil Case No. 11–440 RJL

United States District Court, District of Columbia.

Signed July 21, 2014

Alan Mansfield, Greenberg Traurig, LLP, New York, NY, Laura Metcoff Klaus, Greenberg Traurig, L.L.P., Amer S. Ahmed, Richard Melvyn Cooper, Williams & Connolly LLP, Washington, DC, for Plaintiffs.

Adam D. Kirschner, Patrick George Nemeroff, U.S. Department of Justice, Washington, DC, for Defendants.

MEMORANDUM OPINION

July 21st , 2014 [## 65, 67]

RICHARD J. LEON, United States District Judge

This suit challenges the composition of the Tobacco Products Scientific Advisory Committee (“TPSAC” or “Committee”), a federal advisory committee established in 2010 by the U.S. Food and Drug Administration (“FDA”) to provide advice and recommendations on scientific issues relating to tobacco products. The suit also challenges the process by which that committee drafted a 2011 report on the use of menthol in cigarettes (“Menthol Report”).¹ Plaintiffs Lorillard, Inc., Lorillard Tobacco Company, and R.J. Reynolds Tobacco Company (collectively, “plaintiffs”) initiated this action in February 2011 against the FDA; the U.S. Department of Health and Human Services (“DHHS”); Kathleen Sebelius, the Secretary of DHHS;² Margaret Hamburg, the Commissioner of Food and Drugs; and Lawrence Deyton, the Director of the FDA's Center for Tobacco Products (collectively, “defendants”) and filed their third amended complaint on April 25, 2013, seeking declaratory and injunctive relief.³ Third Amended Complaint (“3d Am. Compl.”) [Dkt. # 63] ¶¶ 1, 4, 7.

Plaintiffs assert five causes of action alleging lack of compliance with ethics laws and the Federal Advisory Committee Act (“FACA”), 5 U.S.C. app. 2 §§ 1–16, all in violation of the Administrative Procedure Act (“APA”), 5 U.S.C. § 551 et seq. 3d Am. Compl. ¶¶ 129–84. With regard to the Committee's composition, plaintiffs allege that defendants' appointment of three voting committee members—Drs. Neal Benowitz, Jack Henningfield,⁴ and Jonathan Samet (together, the “Challenged Members”⁵ )—was “arbitrary, capricious, an abuse of discretion, and otherwise not in compliance with law” under the APA, 5 U.S.C. § 706(2)(A), because these three members had alleged financial conflicts of interest or the appearance of conflicts of interest, in violation of 18 U.S.C. §§ 202(a), 208 ; 21 U.S.C. § 379d-1 ; and 5 C.F.R. pts. 2635, 2640. 3d Am. Compl. ¶¶ 129–40 (Counts One and Two). Further, plaintiffs allege that defendants violated the APA by appointing a committee lacking “fair[ ] balance[ ] in terms of the points of view represented” and exhibiting “special interest” influence, in violation of FACA, 5 U.S.C. app. 2 §§ 5(b)(2)-(3), (c). 3d Am. Compl. ¶¶ 141–49 (Count Three).

Next, with regard to the TPSAC's deliberative process, plaintiffs allege that: members of the Committee held a private meeting on March 17, 2011, in violation of FACA, because the meeting was not open to the public and timely notice of the meeting was not previously published, 3d Am. Compl. ¶¶ 150–57 (Count Four); and defendants, in violation of FACA, failed to disclose various documents that were created by the TPSAC and its subcommittee and related to the Menthol Report. 3d Am. Compl. ¶¶ 158–84 (Count Five). As a remedy for these alleged violations of ethics laws and FACA under the APA, plaintiffs seek, inter alia, an order enjoining the FDA to reconstitute the TPSAC's membership so that it complies with applicable ethics laws and FACA, and an injunction barring defendants from using the allegedly “tainted” Menthol Report. 3d Am. Compl. at 84–91; see also Pls.' Unredacted Reply Mem. (“Pls.' Reply”) [Dkt. # 77] at 23–24.

Before the Court are the parties' cross-motions for summary judgment.⁶ Upon consideration of the pleadings, relevant law, and entire record therein, the Court concludes, first, that the FDA erred in determining that the three Challenged Members of the TPSAC did not have financial and appearance conflicts of interest, and second, that therefore the FDA's appointment of those members was arbitrary and capricious, in violation of the APA, and fatally tainted the composition of the TPSAC and its work product, including the Menthol Report. Accordingly, plaintiffs' motion is GRANTED, in part, on Counts One and Two, and defendants' motion is DENIED.⁷

BACKGROUND

I. Legal Background

a. The Tobacco Control Act and the TPSAC's Role

Until recently, the FDA lacked authority to regulate tobacco products. See FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120, 120 S.Ct. 1291, 146 L.Ed.2d 121 (2000) (holding that FDA lacked authority under the Federal Food, Drug, and Cosmetic Act (“FDCA”) to regulate tobacco products as customarily marketed). In 2009, however, Congress passed the Family Smoking Prevention and Tobacco Control Act (“TCA” or “Act”), Pub. L. No. 111–31, 123 Stat. 1776 (2009), which authorized the FDA “to regulate tobacco products under the [FDCA] ... by recognizing it as the primary Federal regulatory authority with respect to the manufacture, marketing, and distribution of tobacco products.” Id. § 3(1) (Purpose). In part of that Act, Congress established the TPSAC, a twelve-member advisory committee, to “provide advice, information, and recommendations to the Secretary [of DHHS]” relating to the regulation of tobacco. 21 U.S.C. § 387q(c).⁸

The TCA authorizes the Secretary of DHHS to refer certain matters to the TPSAC. For instance, the FDA “may refer a proposed regulation for the establishment, amendment, or revocation of a tobacco product standard to the [TPSAC] for a report and recommendation with respect to any matter involved in the proposed regulation which requires the exercise of scientific judgment.” 21 U.S.C. § 387g(d)(5)(A). Or the agency may refer an application to produce and distribute a “new tobacco product” to the Committee for a report and recommendation. 21 U.S.C. § 387j(b)(2).

But the TCA also affirmatively requires the Secretary to refer certain matters to the TPSAC. As relevant here, Congress chose to set two specific priorities for the Committee to address upon its formation, mandating, first, that “[i]mmediately upon the establishment of the [TPSAC] ... the Secretary shall refer to the Committee for report and recommendation ... the issue of the impact of the use of menthol in cigarettes on the public health, including such use among children, African–Americans, Hispanics, and other racial and ethnic minorities.” 21 U.S.C. § 387g(e)(1). Second, Congress also directed that “[t]he Secretary shall refer to the [TPSAC] for report and recommendation ... the issue of the nature and impact of the use of dissolvable tobacco products [ (“DTPs”) ] on the public health, including such use among children.” 21 U.S.C. § 387g(f)(1). The TCA further required that the TPSAC submit its report on menthol within one year of its establishment and its report on DTPs within two years thereof. 21 U.S.C. § 387g(e)(2), (f)(2). In providing such advice, the TPSAC is obligated to address the considerations the Secretary evaluates when issuing tobacco product standards, 21 U.S.C. § 387g(e)(1), (f)(1) (referring back to subsection (a)(3)(B)(i)), but the Act does not require the Secretary to defer to TPSAC's advice or recommendations, 21 U.S.C. § 387g(e)(3), (f)(3).

b. Laws Governing the TPSAC's Composition

Advisory committees that advise executive branch officials and agencies, such as the TPSAC, are governed by FACA, 5 U.S.C. app. 2 §§ 1 –16. See Final Rule, Advisory Committee; Tobacco Products Scientific Advisory Committee; Establishment, 74 Fed.Reg. 43,042, 43,042 (Aug. 26, 2009) (acknowledging TPSAC is “governed by ... the Federal Advisory Committee Act, which sets forth standards for the formation and use of advisory committees”). Congress passed FACA in 1972 “to ensure that new advisory committees be established only when essential and that their number be minimized; that they be terminated when they have outlived their usefulness; that their creation, operation, and duration be subject to uniform standards and procedures; that Congress and the public remain apprised of their existence, activities, and cost; and that their work be exclusively advisory in nature.” Public Citizen v. Dep't of Justice, 491 U.S. 440, 446, 109 S.Ct. 2558, 105 L.Ed.2d 377 (1989) (citing 5 U.S.C. app. 2 § 2(b) ). While Congress recognized that advisory committees “are frequently a useful and beneficial means of furnishing expert advice, ideas, and diverse opinions to the Federal Government,” 5 U.S.C. app. 2 § 2(a), “Congress also feared the proliferation of costly committees, which were often dominated by representatives of industry and other special interests seeking to advance their own agendas,” Cummock v. Gore, 180 F.3d 282, 284 (D.C.Cir.1999). Accordingly, “FACA's principal purpose was to enhance the public accountability of advisory committees established by the Executive Branch and to reduce wasteful expenditures on them.” Public Citizen, 491 U.S. at 459, 109 S.Ct. 2558.

To achieve these purposes, FACA mandates, among other things, restrictions on the membership of advisory committees. As relevant here, FACA requires that any subsequent legislation establishing (or authorizing the establishment of) an advisory committee “shall ... require the membership of the advisory committee to be fairly balanced in terms of the points of view represented and the functions to be performed by the advisory committee.” 5 U.S.C. app. 2 § 5(b)(2). And any such legislation “shall” also “contain appropriate provisions to assure that the advice and recommendations of the advisory committee will not be inappropriately influenced by the appointing authority or by any special interest, but will instead be the result of the advisory committee's independent judgment.” 5 U.S.C. app. 2 § 5(b)(3).⁹

The TCA is an example of such subsequent legislation establishing an...