Rejected e-liquid manufacturer gets license in vaping case

April 11, 2017

A company that sued over Indiana’s unconstitutional vaping and e-cigarette licensing law will get an Indiana permit to manufacture e-liquids, and taxpayers will pick up the company’s legal fees for its trouble, a judge ordered Monday.

Judge Richard Young’s order was the latest defeat for a state law that a federal circuit court struck down portions of in January. Lawmakers this session are scrambling to fix the legislation over concerns it created a virtual monopoly. The Indiana House last week passed a bill that would overhaul the law.

Young on Monday ruled portions of the law still on the books violate the dormant Commerce Clause, extending the 7th Circuit’s prior ruling to a separate case that challenged the law.

Naples, Florida-based GoodCat LLC was among e-liquid makers shut out of doing business by Indiana’s restrictive law that limited participation in the market to a handful of companies. GoodCat sued and was granted summary judgment in August.

The state is barred from enforcing its vaping statute as applied to GoodCat, the judge ruled in GoodCat’s suit against the Indiana Alcohol and Tobacco Commission and others.

"The court also orders defendants to issue an e-liquid manufacturing permit to GoodCat forthwith," Young wrote. "GoodCat shall file any petition for an award of attorneys’ fees … within 14 days of the date of this order.”

Several other e-liquid makers who intervened in the suit attempted to moot the case, arguing that when the 7th Circuit Court of Appeals struck down Indiana’s vaping statute, the ruling entitled them, and GoodCat, to participate in the market. Young noted, though, that GoodCat had previously received only a preliminary injunction against the state, and that the ATC could potentially revoke GoodCat’s permit if a final order wasn’t issued in the case.


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