Case 1:16-cv-01460-APM Document 234 Filed 10/30/20 Page 1 of 7

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

CIGAR ASSOCIATION OF AMERICA, )

PREMIUM CIGAR ASSOCIATION, and )
CIGAR RIGHTS OF AMERICA, )
)
Plaintiffs, )
)
v. ) Civ. No. 1:16-cv-01460-APM
)
UNITED STATES FOOD AND DRUG )
ADMINISTRATION, )
UNITED STATES DEPARTMENT OF )
HEALTH AND HUMAN SERVICES, )
ALEX AZAR, in his official capacity )
as Secretary of Health and Human Services )
Office of the Secretary, and )
STEPHEN HAHN, M.D., )
in his official capacity )
as Commissioner of Food and Drugs, )
)
Defendants. )
_________________________________________ )

PLAINTIFFS’ MOTION FOR

LEAVE TO AMEND THE COMPLAINT

Pursuant to Federal Rule of Civil Procedure 15(a)(2), Plaintiffs Cigar Association of

America, Premium Cigar Association, and Cigar Rights of America (together, “Plaintiffs”) move

for leave to file a Fourth Amended Complaint in the form of the proposed Fourth Amended

Complaint attached to the accompanying proposed Order.

Plaintiffs’ proposed Fourth Amended Complaint reasserts, in light of recent regulatory

developments, challenges to the FDA’s arbitrary and capricious decision to reject “Option 2” and

to subject premium cigars to its contemplated regulatory scheme in the Final Deeming Rule, as

well as the FDA’s arbitrary and capricious errors in analyzing the costs and benefits of subjecting
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premium cigars to regulation. Such challenges were previously brought as Counts IV and V of

the original complaint.

Plaintiffs’ need to reassert these challenges arises from the FDA’s failure to take actions

on open rulemakings that could have corrected its arbitrary and capricious decision to reject Option

2 and to subject premium cigars to regulation. In July 2017, the FDA announced a potential

pathway to redressing the rejection of Option 2. FDA, FDA Announces Comprehensive

Regulatory Plan to Shift Trajectory of Tobacco-Related Disease, Death (July 27, 2017). In March

2018, the FDA opened a rulemaking on its reconsideration of subjecting premium cigars to Option

2. Regulation of Premium Cigars, Advanced Notice of Proposed Rulemaking, 83 Fed. Reg. 12,901

(Mar. 26, 2018). Plaintiffs participated in that rulemaking through the submission of extensive

comments that included scientific and expert reports for the FDA’s consideration. The comment

period for the rulemaking closed in July 2018—more than two years ago.

In 2019, Plaintiffs were hopeful that action on this rulemaking docket was forthcoming that

might spare the need for the Court to resolve the ultimate question of the FDA’s decision to reject

Option 2 and to regulate premium cigars. On the basis of that hope and expectation, Plaintiffs

withdrew their challenges to the FDA’s Option 2 decision and the FDA’s attendant assessment of

costs and benefits. The Plaintiffs did so on the FDA’s explicit agreement that, if those challenges

were reasserted, the FDA would not argue that the claims are barred by res judicata or claim

splitting. See ECF No. 178 at 2.

Nearly a year has passed, and the FDA has taken no action on the open premium

rulemaking. Nor does any action appear imminent.

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On August 5, 2020, the agency announced that it would undertake a new research effort of

indefinite duration specific to premium cigars, perhaps implying that action on the premium cigar

rulemaking would await that research project. ECF No. 209 at 4.

The decision to regulate premium cigars in the first instance was arbitrary and capricious.

This error subjected premium cigar manufacturers to a regulatory scheme that currently imposes

significant compliance costs across a wide range of regulatory requirements. Plaintiffs and their

members should not continue to be subject to these unlawful costs and burdens.

In light of the parties’ December 24, 2019 agreement regarding Counts IV and V and the

FDA’s long delay in curing its arbitrary and capricious rejection of Option 2, amendment of the

complaint is appropriate and necessary for Plaintiffs’ relief. The decision to allow leave to amend

“lies in the sound discretion of the district court.” Boyd v. Dist. of Columbia, 465 F. Supp. 2d 1, 3

(D.D.C. 2006). “The standard for allowing amendment of a complaint is liberal.” Molock v. Whole

Foods Mkt., Inc., No. 16-cv-02483, 2017 WL 2693474, at *1 (D.D.C. June 22, 2017) (Mehta, J.).

Federal Rule of Civil Procedure 15(a)(2) “direct[s] the court to ‘freely give leave [to amend] when

justice so requires.’” Vogel v. Go Daddy Grp., Inc., 266 F. Supp. 3d 234, 238 (D.D.C. 2017)

(Mehta, J.) (quoting Fed. R. Civ. P. 15(a)(2)). “Denial of leave to amend therefore constitutes an

abuse of discretion unless the court gives sufficient reason, such as futility of amendment, undue

delay, bad faith, dilatory motive, undue prejudice, or repeated failure to cure deficiencies by

previous amendments.” Boyd, 465 F. Supp. 2d at 3.

The timing of challenging the FDA’s decision to subject premium cigars to regulation and

its reasoning in support thereof is entirely a result of attempting to avoid burdening this Court with

matters the FDA appeared poise to fix. As time has passed, the burdens of the regulatory scheme

on premium cigar manufacturers and retailers can no longer patiently await agency corrective

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action. There is no undue delay, bad faith, or dilatory motive that would counsel against

amendment, and the Government on Christmas Eve 2019 agreed not to argue otherwise.

Defendants will not be subject to any “undue prejudice” by amendment of the complaint.

Foremost-McKesson Inc. v. Islamic Republic of Iran, 759 F. Supp. 855, 858 (D.D.C. 1991) (“To

show prejudice, [the non-moving party] must show that it was unfairly disadvantaged or deprived

of the opportunity to present facts or evidence which it would have offered had the amendments

been timely.”). The FDA could have avoided litigating the challenges to its decision to subject

premium cigars to regulation by taking curative action on the premium cigar rulemaking docket.

The FDA has only been benefitted by the course of litigating these issues and the opportunity

(which it had unfortunately not taken) to spare itself from defending, and this Court from having

to decide, these important issues.

Finally, the proposed amendment is not “futile.” Hettinga v. United States, 677 F.3d 471,

480 (D.C. Cir. 2012). This Court has now found on two different occasions that the FDA failed

to answer the questions that it presented with respect to premium cigars when it promulgated the

final deeming rule. Cigar Ass’n of Am. v. FDA, 436 F. Supp. 3d 70, 85 (D.D.C. Feb. 2, 2020);

Cigar Ass’n of Am. v. FDA, 2020 WL 4816459 at *14-15 (D.D.C. Aug. 19, 2020). Plaintiffs will

show that similar errors infect the FDA’s rejection of Option 2 and its decision to subject premium

cigars to its contemplated regulatory scheme.

For the foregoing reasons, Plaintiffs respectfully request this Court grant Plaintiffs leave to

amend the complaint. A clean copy of the proposed Fourth Amended Complaint is attached to

this Motion as Exhibit 1. A redline comparison of the proposed Fourth Amended Complaint to

the operative complaint is attached as Exhibit 2.

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Pursuant to Local Rule 7(m), counsel for Plaintiffs conferred with counsel for the

Government in a good-faith effort to determine whether there is any opposition to the relief sought.

Plaintiffs offered counsel for the Government an opportunity to review a draft of the amended

complaint. Counsel for the Government declined and reserved the right to oppose this motion

upon further consultation with the FDA.

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Dated: October 30, 2020 Respectfully submitted,

/s/ Michael J. Edney

Michael J. Edney, DC Bar No. 492024
STEPTOE & JOHNSON LLP
1330 Connecticut Ave., NW
Washington, DC 20036
Telephone: (202) 429-3000
Fax: (202) 429-3902
medney@steptoe.com

Attorney for Plaintiffs Premium Cigar

Association and Cigar Rights of America

/s/ Mark S. Raffman

Mark S. Raffman, DC Bar No. 414578
Andrew Kim, DC Bar No. 1029348
GOODWIN PROCTER LLP
1900 N Street, NW
Washington, DC 20036
Telephone: (202) 346-4000
Fax: (202) 346-4444
mraffman@goodwinlaw.com
andrewkim@goodwinlaw.com

Attorneys for Plaintiff Cigar Association of

America

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CERTIFICATE OF SERVICE

I hereby certify that on this 30th day of October 2020, I caused the foregoing to be filed

with the Clerk of the Court using the CM/ECF system, which will send notification of such filing

to all counsel of record.

/s/ Michael J. Edney

Michael J. Edney