On Dec. 2, 2025, the U.S. Fifth Circuit Court of Appeals heard oral arguments on a lawsuit brought by Kealani Distribution, LLC and six other vaping-related companies, plus a vaping trade group, against the U.S. Food and Drug Administration (FDA) about whether the agency properly considered the impact on small businesses of its 2021 regulation requiring premarket authorization for new tobacco products, including electronic vaping products.

As reported by Law 360, the judges questioned whether the agency complied with the Regulatory Flexibility Act, which requires that federal agencies assess how new regulations affect smaller firms. The vaping company plaintiffs argued that the FDA relied on outdated economic data and imposed disproportionate costs that could drive many small businesses out of the market.

During the oral arguments, the three-judge panel of the Circuit Court of Appeals pressed the FDA on its shift in position between 2016 and 2021, when the agency moved from a more flexible approach to requiring extensive scientific evidence for new products.

The case comes amid broader challenges to the FDA’s handling of Premarket Tobacco Product Applications (PMTAs), including disputes over flavored e-cigarette denials. Read more here.