Court Opinion

ID: 6115040
Source: CourtListenerOpinion
Date Created: 2022-02-03 15:00:38.195064+00
Date Added: 2024-06-11T08:16:52.440194
License: Public Domain

USCA11 Case: 21-13088    Date Filed: 02/03/2022   Page: 1 of 15

                                         [DO NOT PUBLISH]
                          In the
         United States Court of Appeals
               For the Eleventh Circuit

                 ____________________

                        No. 21-13088
                 Non-Argument Calendar
                 ____________________

SWISHER INTERNATIONAL, INC.,
                                            Plaintiff-Appellant,
versus
UNITED STATES FOOD AND DRUG ADMINISTRATION,
ACTING COMMISSIONER OF FOOD AND DRUGS,
UNITED STATES DEPARTMENT OF HEALTH AND HUMAN
SERVICES,
SECRETARY OF HEALTH AND HUMAN SERVICES,

                                        Defendants-Appellees.
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2                      Opinion of the Court                 21-13088

                     ____________________

           Appeal from the United States District Court
                for the Middle District of Florida
             D.C. Docket No. 3:21-cv-00764-BJD-JBT
                    ____________________

Before JORDAN, ROSENBAUM, and NEWSOM, Circuit Judges.
PER CURIAM:
       This appeal of the denial of preliminary injunctive relief
arises out of the U.S. Food and Drug Administration’s (“FDA”) de-
cision in 2016 to include cigars, pipe tobacco, and electronic nico-
tine delivery systems (e-cigarettes) among the tobacco products
subject to the regulatory framework of the Family Smoking Pre-
vention and Tobacco Control Act, Pub. L. No. 111-31, 123 Stat.
1776 (2009). As a result of that decision, nearly all tobacco products
must receive FDA approval before being marketed. The pre-
market review requirements were deferred for a time for products
that were already on the market at the time of the 2016 decision,
but enforcement is now at the discretion of the FDA.
        Appellant Swisher International, Inc., which manufactures
and sells cigar products, argues that it will suffer irreparable harm
without an injunction preventing the FDA from pursuing enforce-
ment against it pending the resolution of its lawsuit, which chal-
lenges the validity of the 2016 decision and the FDA’s failure to act
on its timely submitted applications for FDA approval. The district
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21-13088               Opinion of the Court                       3

court denied a preliminary injunction, finding that the FDA was
not likely to pursue enforcement related to Swisher’s existing prod-
ucts while its applications remained pending. Because the district
court did not abuse its discretion, we affirm.
                                 I.
       In 2009, Congress enacted the Tobacco Control Act, which
established a comprehensive framework for the FDA to regulate
“[t]obacco products.” 21 U.S.C. § 387a(a); see id. § 321(rr)(1) (de-
fining “tobacco product”). The Act applied to “cigarettes, cigarette
tobacco, roll-your-own tobacco, and smokeless tobacco and to any
other tobacco products that the [FDA] by regulation deems to be
subject to this subchapter.” Id. § 387a(b).
       In 2016, the FDA issued a rule deeming all products that
meet the statutory definition of “tobacco product” (other than ac-
cessories of such products), including cigars, pipe tobacco, and e-
cigarettes, subject to the Tobacco Control Act. Food and Drug Ad-
ministration, Deeming Tobacco Products To Be Subject to the
Federal Food, Drug, and Cosmetic Act, 81 Fed. Reg. 28,973, 28,975,
28,982 (May 10, 2016) (codified at 21 C.F.R. §§ 1100, 1140 & 1143).
We refer to this decision as the Deeming Rule.
       As relevant here, the Tobacco Control Act requires manu-
facturers to obtain FDA authorization before marketing “new to-
bacco products,” which are products that were not already on the
market as of February 2007 or that were modified after that date.
21 U.S.C. § 387j(a). New tobacco products without premarket
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4                         Opinion of the Court                    21-13088

authorization are deemed to be “adulterated” or “misbranded,” id.
§§ 387b(6), 387c(a)(6), and subject to civil and criminal penalties,
injunctive relief, and seizure. See id. § 331 (prohibited acts); id.
§ 332 (injunctive relief); id. § 333 (penalties), id. § 334 (seizure).
       A manufacturer can obtain premarket authorization by sub-
mitting a report showing that a product is “substantially equiva-
lent” either “to a tobacco product commercially marketed” as of
February 2007 or to a tobacco product previously determined to
meet that test. 1 21 U.S.C. § 387e(j)(1); Id. § 387j(a)(2)(i)(I). A new
product is substantially equivalent if it “has the same characteris-
tics” as the comparison or “predicate” product or if the “different
characteristics” of the new product “do[] not raise different ques-
tions of public health” as the comparison product raises. Id.
§ 387j(a)(3)(A).
       In issuing the Deeming Rule, the FDA stated it would defer
enforcement of the premarket authorization requirements with re-
spect to products that were on the market as of the effective date
of the Deeming Rule. 81 Fed. Reg. at 29,010. As relevant here, the
FDA stated that it did not intend to enforce those requirements for
18 months from the rule’s effective date while manufacturers sub-
mitted the reports, and for up to an additional 12 months while the

1 Distinct premarket review processes apply to (1) new tobacco products with-
out a substantially equivalent pre-2007 tobacco product, such as vaping prod-
ucts, and (2) products considered “exempt” due to minor modifications of to-
bacco additives.
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21-13088               Opinion of the Court                        5

FDA processed them. Id. at 29,010–12. In August 2017, the FDA
extended those periods until August 2021 for combustible products
(like cigars), and until August 2022 for noncombustible products
(like most e-cigarettes). Food and Drug Administration, Extension
of Certain Tobacco Product Compliance Deadlines Related to the
Final Deeming Rule, 82 Fed. Reg. 37,459 (Aug. 10, 2017).
       In a later lawsuit, however, a federal district court in Mary-
land vacated the FDA’s August 2017 extension. Am. Acad. of Pedi-
atrics v. Food & Drug Admin., 379 F.Supp.3d 461 (D. Maryland
2019). The court found that the FDA’s decision to extend the dead-
lines across the board by up to five years was contrary to the To-
bacco Control Act and violated the Administrative Procedure Act,
because it was not an exercise of the FDA’s case-by-case discretion.
See id. at 493–94, 497–98. The court eventually ordered the FDA
to require that premarket applications be filed by September 9,
2020. The court stated that new tobacco products subject to timely
premarket applications “may remain on the market without being
subject to FDA enforcement actions” until September 9, 2021.
       In June 2021, the FDA held a public webinar related to
deemed products in anticipation of the approaching deadline. FDA
staff members acknowledged the substantial backlog of pending
premarket review applications. Nevertheless, consistent with the
Maryland district-court decision, they advised that new tobacco
products “risk FDA enforcement” if not authorized by September
9, 2021, subject to the FDA’s “discretion to defer enforcement
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6                       Opinion of the Court                 21-13088

action against a particular product on a case by case basis” after that
time.
                                  II.
        Swisher produces 173 different cigars, which make up nearly
all its revenue. As a result of a Deeming Rule, it submitted 171
substantial-equivalence reports, covering most of its cigar portfo-
lio, by the September 2020 deadline, investing thousands of hours
and millions of dollars.
        Having received no response or guidance from the FDA re-
garding its pending premarket review applications by August 2021,
Swisher filed a lawsuit challenging the validity of the Deeming Rule
and the FDA’s failure to act. Swisher alleged, among other things,
that the Deeming Rule violated the non-delegation doctrine, ex-
ceeded the FDA’s statutory authority, and was arbitrary and capri-
cious, and that the FDA violated the Administrative Procedure Act
by failing to timely act on its substantial-equivalence reports.
        Swisher also moved for emergency preliminary injunctive
relief preventing the FDA from pursuing enforcement against its
products pending the resolution of its claims. Swisher contended
that, without an injunction, the FDA’s “explicit, threatened en-
forcement,” coupled with its inaction on Swisher’s pending appli-
cations, would force Swisher to pull its products and “shutter its
cigar business to avoid civil and criminal penalties” once the defer-
ment period ended on September 9, 2021. It reasoned that it should
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21-13088               Opinion of the Court                        7

not be required to choose between pulling its products or risking
FDA enforcement solely due to the FDA’s inaction.
        The record shows that, before filing suit, Swisher had writ-
ten to the FDA making similar arguments and asking it to “exercise
its case-by-case discretion to stay enforcement of the Tobacco Con-
trol Act for all Swisher products for which applications for pre-mar-
ket review are currently pending.” The FDA responded by letter
dated August 12, 2021, stating that, “[a]t present, FDA has no in-
tention of initiating an enforcement action against any of Swisher’s
products” that are the subject of this dispute “on the ground that
they are being marketed contrary to” the premarket review re-
quirements. The letter continued,
      If FDA were to later seek to initiate an enforcement
      action regarding 21 U.S.C. § 387j as to any of those
      products, it would first send a warning letter to
      Swisher, consistent with the agency’s usual practice,
      and would afford Swisher 60 days to respond. The
      agency would then evaluate any arguments and evi-
      dence provided by Swisher in response to the warn-
      ing letter before informing Swisher of any decision to
      initiate an enforcement action.
      The district court held a hearing on Swisher’s motion for a
preliminary injunction on September 1, 2021. At the hearing, the
attorney for the FDA reiterated the FDA’s position from the Au-
gust 12 letter, stating that the FDA had no present intent to bring
an enforcement action against Swisher, but that Swisher would be
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8                      Opinion of the Court                 21-13088

given 60 days’ advance notice and an opportunity to respond if cir-
cumstances changed. So in the FDA’s view, an injunction was not
necessary to preserve the status quo. The attorney asserted that
granting injunctive relief to Swisher could and likely would lead to
a de facto reinstatement of the August 2017 guidance and an effec-
tive overruling of the Maryland district-court decision. In response
to the court’s questions, the attorney also explained that, if the FDA
ultimately did send Swisher a warning letter, it would consider
whether a substantial-equivalence report was pending, among
other factors, and it would consider violations that occur after the
date of the warning letter only, even if it had the authority to im-
pose retroactive penalties.
         For its part, Swisher said that the FDA would not have op-
posed its request for a preliminary injunction if the threat of en-
forcement was not real, and that it did not need to wait for a warn-
ing letter to obtain relief. And in addition to claiming that it would
have to shutter its business without an injunction, Swisher asserted
that it was being irreparably harmed by the “black cloud” hanging
over its products. In support, Swisher pointed to evidence that one
of its largest customers was considering no longer selling Swisher’s
products if Swisher could not certify its compliance with governing
regulations by September 1, 2021.
        The district court denied Swisher’s motion on September 7,
2021. In sum and substance, the court found that Swisher would
not be irreparably harmed if an injunction did not issue because the
risk of FDA enforcement was not sufficiently imminent. The court
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21-13088                Opinion of the Court                         9

noted that the FDA’s statements at the webinar indicated that “the
risk of enforcement would be accompanied by case-by-case review
and companies could obtain continued deferment.” And given the
FDA’s August 12 letter to Swisher and its past conduct, according
to the court, there was no credible reason to believe that an en-
forcement action was forthcoming, or, if one did come, that a court
could not enjoin the FDA at that time. In particular, the court
noted that the FDA was not required to take enforcement action
or assess sanctions; that Swisher had not been “unambiguously”
threatened and there was “no history of the FDA threatening
Swisher for marketing products still under premarket review”; and
that the FDA not only “indicated a willingness to delay any enforce-
ment action, but it attempted to issue guidance affirmatively delay-
ing such action.”
       Based on these observations, the district court concluded
that the September 9, 2021, court-imposed deadline “exists merely
as a possibility” and was “not sufficiently likely to be accompanied
by imminent enforcement action, when considered along with the
FDA’s letter and past actions, to justify injunctive relief.” The court
was receptive to the gist of Swisher’s position, stating that FDA en-
forcement against products subject to timely premarket review ap-
plications “appears on its face, as unjust, contrary to princip[le]s of
due process, and potentially ruinous to Swisher.” “But,” in the
court’s view, the court continued, “that is not what is happening.”
      As for Swisher’s reliance on harm stemming from its cus-
tomer’s concerns about the regulatory morass, the court found that
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10                         Opinion of the Court                        21-13088

the asserted injury was not traceable to the FDA and that “an in-
junction would not preserve the status quo given the passage of the
deadline given by the customer.” This appeal followed.2
                                       III.
        We apply a “highly deferential” standard of review to a dis-
trict court’s denial of a preliminary injunction, reversing “only if
we find that the court clearly abused its discretion.” Siegel v. Le-
Pore, 234 F.3d 1163, 1178 (11th Cir. 2000) (en banc). We review
the district court’s findings of fact for clear error and its conclusions
of law de novo. Forsyth Cnty. v. U.S. Army Corps of Eng’rs, 633
F.3d 1032, 1039 (11th Cir. 2011).
                                       IV.
       A district court may grant a preliminary injunction only if
the movant shows that “(1) it has a substantial likelihood of success
on the merits; (2) irreparable injury will be suffered unless the in-
junction issues; (3) the threatened injury to the movant outweighs
whatever damage the proposed injunction may cause the opposing
party; and (4) if issued, the injunction would not be adverse to the
public interest.” Siegel, 234 F.3d at 1176. “A preliminary injunction
is an extraordinary and drastic remedy not to be granted unless the

2 In the same order, the district court also granted the FDA’s motion to trans-
fer this case to the United States District Court for the District of Columbia for
consolidation with a previously filed case involving similar claims brought by
the Cigar Association of America. Swisher does not appeal the transfer deci-
sion.
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21-13088               Opinion of the Court                        11

movant clearly established the burden of persuasion as to each of
the four prerequisites.” Id. (cleaned up). Indeed, “a preliminary
injunction is ‘an extraordinary remedy never awarded as of
right.’” Benisek v. Lamone, 138 S. Ct. 1942, 1943 (2018).
       We begin—and ultimately end—our discussion with irrepa-
rable injury, which is “the sine qua non of injunctive relief.” Id.
(quotation marks omitted). Even where a movant establishes a
likelihood of success on the merits, the absence of a showing of
irreparable injury “would, standing alone, make preliminary in-
junctive relief improper.” Id.
        For an injunction to issue, “the asserted irreparable injury
must be neither remote nor speculative, but actual and imminent.”
Id. at 1176–77 (quotation marks omitted). In other words, irrepa-
rable harm must be “likely in the absence of an injunction.” Winter
v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 21–22 (2008) (emphasis
in original). “[A] possibility of irreparable harm” is not enough. Id.
       The district court did not abuse its discretion in denying pre-
liminary injunctive relief on the ground that Swisher was not likely
to suffer irreparable harm without an injunction. The court rea-
sonably concluded that Swisher did not “clearly establish[]” its bur-
den of persuasion as to that factor. See Siegel, 234 F.3d at 1176.
       At the outset, we acknowledge that FDA enforcement re-
mains a possibility. According to the FDA, it retains case-by-case
discretion to commence enforcement actions after September 9,
2021, even against products for which substantial-equivalence
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12                      Opinion of the Court                 21-13088

reports remain pending. Because (as far as we know) the FDA has
yet to act on Swisher’s reports, there remains at least the possibility
that Swisher will be subject to enforcement action for marketing
products that have not passed the premarket review process.
        But “a possibility of irreparable harm” is not enough. Win-
ter, 555 U.S. at 21–22. And here, the record amply supports the
district court’s finding that FDA enforcement against Swisher’s
products once the deferment period ended on September 9, 2021,
was neither “likely,” id., nor “actual and imminent,” Siegel, 234
F.3d at 1176–77. In its August 12 letter to Swisher, FDA stated that
it had “no intention of initiating an enforcement action against any
of Swisher’s products” that are the subject of this dispute “on the
ground that they are being marketed contrary to” the premarket
review requirements. The FDA’s attorney reiterated that position
at the hearing on the motion for a preliminary injunction. And that
position is also consistent with the FDA’s August 2017 guidance—
later vacated by court order—deferring enforcement of the pre-
market review requirements.
      That no enforcement action against Swisher was intended
or even contemplated by the FDA once the deferment period
ended is further supported by the lack of enforcement to date. It
appears that the FDA has taken no steps to warn Swisher about its
products or to institute an enforcement action against Swisher
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21-13088                  Opinion of the Court                              13

since September 10. 3 Nor has Swisher suggested that it has re-
moved any of its products from stores or taken other mitigatory
measures in anticipation of such agency action.
        Moreover, the district court reasonably concluded that,
even if circumstances changed and the FDA decided to enforce,
Swisher was unlikely to suffer irreparable harm because it would
have an opportunity to seek to enjoin the FDA before any harm
was realized. At the hearing on the motion for preliminary injunc-
tion, the FDA represented that, consistent with its general prac-
tices, it would not bring an enforcement action without providing
60 days’ advance notice and considering Swisher’s response, and
that it would seek penalties for only those violations occurring after
the warning letter. Swisher’s objections that an FDA warning let-
ter itself carries legal consequences, or that it would be too late to
seek injunctive relief once a warning letter was issued, are not well
taken. See Holistic Candlers & Consumers Ass’n v. Food & Drug
Admin., 664 F.3d 940, 943 (D.C. Cir. 2012) (“FDA’s warning letters

3 On September 9, 2021, the FDA issued an update regarding its progress on
reviewing applications for premarket approval. Consistent with its earlier
statements, the FDA advised that new tobacco products without premarket
authorization “are subject to enforcement action at FDA’s discretion,” but that
the FDA’s highest enforcement priorities concerned “[p]roducts for which no
application [for premarket review] is pending.” FDA, Perspective: FDA’s Pro-
gress on Tobacco Product Application Review and Related Enforcement
(Sept. 9, 2021), available at https://www.fda.gov/tobacco-products/ctp-
newsroom/perspective-fdas-progress-tobacco-product-application-review-
and-related-enforcement (last visited Jan. 26, 2019).
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14                        Opinion of the Court                    21-13088

. . . neither mark the consummation of the agency’s decisionmak-
ing process nor determine the appellants’ legal rights or obliga-
tions.”). 4
       Nor are we persuaded on this record by Swisher’s claims
that the legal uncertainty surrounding its products is causing it ir-
reparable harm. Swisher claims that it is losing customers and
goodwill by being stuck in legal limbo through no fault of its own.
While the “loss of customers and goodwill is an irreparable injury,”
BellSouth Telecomms., Inc. v. MCIMetro Access Transmissions
Servs., LLC, 425 F.3d 964, 970 (11th Cir. 2005) (quotation marks
omitted), Swisher’s evidence does not show that it has lost custom-
ers or goodwill. Although a major customer had indicated that the
legal uncertainty might lead it stop purchasing Swisher’s cigars,
Swisher’s own briefing indicates that it “has been able to avoid that
disaster as of now.” Swisher asserts that such a disaster “could well
materialize” and that it “fully expects other distributors to have
similar concerns,” but these claims are speculative and do not
clearly show that injunctive relief is necessary.
      On the whole, we cannot say that the district court clearly
abused its discretion by concluding that an injunction was not nec-
essary to preserve the status quo pending the resolution of
Swisher’s lawsuit. See Siegel, 234 F.3d at 1178. In our view, the

4 FDA, Regulatory Procedures Manual, ch.4, at 4 (Oct. 2021) (“A Warning Let-

ter is informal and advisory. It communicates the agency’s position on a mat-
ter, but it does not commit FDA to taking enforcement action.”).
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21-13088                    Opinion of the Court                                 15

district court reasonably found, based on the current record, that
the likelihood of irreparable harm was too remote to justify grant-
ing preliminary injunctive relief. 5 We therefore affirm the denial
of Swisher’s motion for a preliminary injunction.
        AFFIRMED.

5       The cases on which Swisher primarily relies do not require a different
result. For the most part, these cases concern the requirements of Article III
standing for pre-enforcement review where a plaintiff has expressed an intent
to engage in proscribed conduct arguably protected by a constitutional inter-
est, such as free speech. See, e.g., Wollschlaeger v. Governor, Fla., 848 F.3d
1293, 1303–06 (11th Cir. 2017) (en banc) (stating that a “credible threat of pros-
ecution” is sufficient to confer standing in such a case); Robinson v. Att’y Gen.,
957 F.3d 1171, 1177–78 (11th Cir. 2020); Socialist Workers Party v. Leahy, 145
F.3d 1240, 1244 (11th Cir. 1998). They do not directly speak to the require-
ments for granting injunctive relief. Moreover, irreparable harm is not a legal
determination like standing, but instead is an equitable one to be made based
on the specific facts of the case. See, e.g., America’s Health Ins. Plans v. Hudg-
ens, 742 F.3d 1319, 1334 (11th Cir. 2014) (describing irreparable harm as an
“equitable factor[]”). And for the reasons we have explained, the district court
did not abuse its discretion in finding, in the specific circumstances of this case,
that Swisher would not be irreparably harmed without an injunction.