IN’s Vapor Pens and E-Liquid Act Violates the Commerce Clause Because of Its Extraterritorial Reach

On January 30, the U.S. Court of Appeals for the Seventh Circuit held that the extraterritorial effects of Indiana’s Vapor Pens and E-Liquid Act, Ind. Code §§ 7.1-7-1-1 et seq., violated the dormant Commerce Clause of the U.S. Constitution. In 2015 the State of Indiana en-acted the Act “to regulate the manufacture and distribution of vapor pens and the liquids used in so-called e-cigarettes.”). The Seventh Circuit reasoned:

The Act is written so as to have extraterritorial reach that is unprecedented, imposing detailed requirements of In-diana law on out-of-state manufacturing operations. The Act regulates the design and operation of out-of-state production facilities, including requirements for sinks, cleaning products, and even the details of contracts with outside security firms and the qualifications of those firms’ personnel. Imposing these Indiana laws on out-of-state manufacturers violates the dormant Commerce Clause of the United States Constitution.

It confirmed that, while the goals of the Act may be laudable, “Indiana may not… try to achieve these health and safety goals by directly regulating out-of-state factories and commercial transactions.”  The Seventh Circuit reviews the history of dormant Commerce Clause litigation, and its research “has not revealed a single appellate case permitting any direct regulation of out-of-state manufacturing processes and facilities comparable to the Indiana Act.”  The case is Legato Vapors, LLC, et al., and Right to be Smoke-Free Coalition, Inc. v. David Cook, et al.