Food and Drug Administration v. Wages & White Lion Investments, L.L.C. et al.

604 U.S. ____ (2025)

Ralph F. Hall[1]

Why It Made the List

“FDA can’t do that! It can’t change its position midstream! It’s not fair! It’s not legal!”

How often have you heard this? The answer to this common complaint is now clearer.

The Supreme Court rarely decides FDA cases. So, when the Supreme Court decided Wages and White Lion[2] in April 2025, this alone should make FDA practitioners sit up and take notice. Further, the Supreme Court in this case directly addresses the “change-in-position” doctrine—another critically important reason to read this case. In this time of great change in the administrative law area, any case that addresses both FDA matters and provides insights into the Supreme Court’s administrative law thinking is doubly worthy of attention. And finally, a case that addresses, at least in part, the nation’s ongoing debate over tobacco, vaping, and e-cigarettes should be of high interest.

In this case, the Supreme Court resolved a circuit split, reversed the Fifth Circuit, and upheld, subject to a remand on one issue, FDA’s denial of hundreds of marketing applications for flavored e-cigarettes and vaping products. In doing so, the Court:

1) provided important insights into when an administrative agency can change some policy,

2) addressed, at least in dicta, FDA’s power to determine what constitutes sufficient evidence that some article is “safe and effective” (or some similar standard), and,

3) remanded the case to the Fifth Circuit to determine how “harmless error” claims should be analyzed.

And finally, in this time of hyper-partisanship and a divided Supreme Court, any 9–0 decision seems noteworthy.

Background

The public, Congress, FDA, other regulatory agencies, and tobacco product producers have struggled for decades over the public health challenges, legal rights and responsibilities, and possible regulatory paths forward regarding tobacco products. Prior to the 1990s, FDA took a hands-off approach, asserting that Congress had not given FDA jurisdiction over tobacco products such as cigarettes. During this time period, Congress passed several laws impacting cigarette marketing and research, such as requiring warning labels and mandating scientific reports.[3] In 1996, FDA stepped into this perceived void and asserted jurisdiction over tobacco products. This effort came to naught when the Supreme Court ruled that FDA’s 1996 effort to regulate cigarettes was invalid because Congress had not given FDA jurisdiction over tobacco products.[4]

In 2009, Congress passed the Tobacco Control Act (TCA).[5] The TCA gave FDA explicit jurisdiction over tobacco products and required that a sponsor obtain a marketing authorization for a “new tobacco product.” The tobacco landscape, however, was rapidly changing as vaping (or e-cigarettes) were becoming increasingly popular. Various companies developed flavored vaping systems that could deliver fruit, sweet, or dessert flavors. These companies and others argue that vaping is safer than smoking leaf tobacco, primarily due to the absence in e-cigarettes of tar and other combustion byproducts. However, many public health experts and other stakeholders expressed strong concerns that these flavored vaping products were attractive to young people and would serve to get this demographic “hooked” on nicotine. And some significant number of vaping customers would transition to the more dangerous traditional leaf tobacco cigarettes.

In 2016, after extensive debate, FDA successfully “deemed” e-cigarettes/vaping products to be “tobacco products” under the TCA.[6] And FDA further concluded that these e-cigarettes met the definition in the TCA of a “new tobacco product.”

A “new tobacco product” cannot be marketed until it has received marketing approval from FDA.[7] The TCA requires FDA to deny any such marketing application unless the applicant demonstrates that the product “would be appropriate for the protection of public health” and, in doing so, FDA is obligated to consider “the risks and benefits to the population as a whole,” taking into account the likelihood that current smokers would switch to the “safer” vaping option and the risk of non-smokers, particularly the young, starting to use tobacco products including vaping.[8]

Starting after 2016, FDA worked to develop rules and guidance for such submissions, including the types of scientific evidence needed, information on marketing and risk abatement efforts, and the need for cross-product comparisons. As is common when FDA implements a new regulatory system, FDA gathered information and input from multiple sources, issued draft guidance documents, published FAQs, engaged in public discussions, etc. Over time, FDA’s thinking evolved.

Prior to 2021, the plaintiffs and other entities submitted many marketing applications covering millions of specific products. However, in 2021, FDA denied these applications.[9]

Applicants, including the plaintiffs in this action, then sued FDA and asserted that FDA acted in an arbitrary and capricious manner in denying these applications. Specifically, the plaintiffs asserted that FDA had changed its position and had not followed its guidance on a number of key elements including:

• The types of scientific evidence needed to be submitted. Specifically, the plaintiffs asserted that, contrary to prior FDA positions, FDA was now requiring randomized, controlled studies.
• FDA was now insisting on robust cross-product comparative studies. (For example, were flavored vaping systems more or less likely to entice youth use compared to non-flavored vaping systems?).
• FDA’s views about, and enforcement priorities relating to, device type.
• FDA’s failure to consider marketing and risk abatement plans contrary to its guidance that such marketing plans were critical.

The plaintiffs argued that these differences violated the “changes-in-position” doctrine and thus rendered FDA’s actions arbitrary and capricious and contrary to law.

These plaintiffs sued FDA in the Fifth Circuit. An initial three-judge panel ruled in favor of FDA. [10] However, a rehearing en banc found against FDA and in favor of the plaintiffs.[11] The Supreme Court granted FDA’s petition for writ of certiorari due to a circuit split on these issues. And, on April 2, 2025, the Supreme Court unanimously reversed the Fifth Circuit.[12] Essentially, the Supreme Court held that FDA acted within its statutory authority and, with one exception, had not violated any “change-in-position” obligations. With regard to this change in position, FDA argued that it was harmless error. The Supreme Court remanded the case for the lower court to determine the appropriate application of the harmless error rule. [13]

Discussion

Tobacco-Specific Considerations

Apart from the harmless error issue discussed below, this decision upholds FDA’s denial of a plethora of vaping-related marketing authorization submissions. Going forward, vaping companies will need to follow FDA’s scientific evidence requirements, comparative product assessment requirements, and recognize that there is not a safe harbor for non-cartridge products.[14] Assuming that the current administration continues along the same path as the prior administration, this decision creates a higher bar for the approval of a tobacco product marketing submission.

Such submissions will need to seriously consider including robust and objective scientific data, perhaps in the form of randomized or controlled studies. Comparative cross-product studies also may be mandated.

Administrative Law Considerations

Change-in-Position Doctrine

The key issue that the Supreme Court addressed, and perhaps the most important aspect of this case for FDA practitioners, involves the “change-in-position” doctrine. The change-in-position doctrine establishes when FDA can change or modify its position without formal processes.

In this case, the plaintiffs asserted that FDA set forth a number of specific requirements or permissible approaches and then changed the requirements between the time the guidances/instructions were issued and the time that FDA denied the plaintiffs’ applications. The plaintiffs contend that their applications should and would have been granted had FDA acted in accordance with its original requirements. The plaintiffs sued FDA and contended that FDA acted arbitrarily and capriciously in changing the requirements in the midst of the application process. In essence, the plaintiffs argued that FDA “moved the goal posts” in the middle of game.[15]

The question of whether FDA has changed or can change positions midstream is critical to the regulated community. Stakeholders, whether regulated industry, patient groups, or others, commonly complain that FDA has improperly changed its position without following some formal notice and comment process.

The Court stated that the change-in-position doctrine raises two key questions:

• Did the agency actually change its position? Obviously, if FDA hasn’t changed its position, the analysis is done, and the plaintiff loses (at least on this point).
• The second question actually has several subparts.[16]
• Did the agency “display awareness” that it was changing its position?
• Did the agency offer “good reasons” for the new policy? [17] [18]

In order to answer question one, we must know what constitutes a “change-in-position.” The Court stated that a change in position can occur when the agency rescinds a prior regulation, disavows prior agency actions, or expands or “abandons” the scope of its enforcement actions.[19] Except for formal revocation of an existing regulation or guidance, these examples leave a fair amount of gray. There is always some fluctuation in what the agency does and how it implements its authorities.[20] For example, how extensive must some change in enforcement scope be before the change-in-position doctrine is triggered?

The plaintiffs asserted that the agency knew it had changed positions, though FDA cannot “change the requirements” without notice and providing a reasonable opportunity for the entity to conform to the new requirements. In addition, the plaintiffs asserted that FDA must consider the applicants’ reasonable reliance on FDA’s original position.[21]

The Supreme Court also spoke to the “good reasons” point. The Court held that the reasons for the change in position need not be “better” than the old policy. The agency does not need the type of justification needed for a brand-new regulation, written on a blank slate. The agency must be cognizant whether the old policy has “serious reliance issues.” These reliance interests must be more than just a belief by a stakeholder that FDA may take some action. [22]

In this case, the plaintiffs asserted that FDA changed its position on four key elements of a new tobacco marketing application and approval:

• The plaintiffs asserted that FDA initially said it did not require complex, time consuming, and expensive studies such as randomized controlled studies or longitudinal studies. And yet, one of the grounds for the denial of these marketing applications was that such studies had not been conducted.
• The plaintiffs claimed that FDA gave them discretion to pick among various comparative products, but then denied the marketing applications because the applicants had not compared fruit, candy, or dessert flavored products against tobacco flavored products.
• Next, the plaintiffs complained that FDA “abandoned” its earlier guidance and rejected all dessert, fruit, and candy flavored products regardless of device type.
• Finally, FDA mandated the submission of marketing and risk abatement plans, and then FDA completely failed to even consider such plans.

The Court determined that FDA had not, in fact, changed its position with regard to the first three issues listed above. The asserted “changes” were within the discretion of the agency.[23] Given that the plaintiffs failed to satisfy “prong one” of the change-in-position doctrine, the second set of questions are irrelevant to these three claims.

The Court recognized that agencies need the ability to develop their thinking on regulatory matters, particularly new regulatory systems. The Court also recognized the value of having at least some of FDA’s regulatory thinking available to the public as the agency worked to establish its positions. The Supreme Court concluded that during the 2016–2021 time period, FDA was working through its thinking on these and similar topics. It was expressing “preliminary” or non-binding thoughts about issues such as the nature of the valid scientific evidence needed to support a marketing application. Sometimes this was in the form of draft or final guidances, other times FDA’s then current thinking was expressed in public meetings, speeches, etc. Because of the preliminary and non-binding nature of these public statements, the Court upheld FDA’s discretion to determine what constituted sufficient valid scientific evidence. In summary, the court described the situation as: “These voluminous and discussive documents paint a picture of an agency that was feeling its way towards a final stance and was unable or unwilling to say in clear and specific terms precisely what applicants would have to provide.”[24]

The Court’s ruling that FDA had not changed its position on these three items may seem anticlimactic to some. This should not be the reaction. What is critical is that in order to arrive at this decision, the Court had to accept that FDA has substantial discretion in working to develop its positions and substantial discretion in determining what is needed to satisfy statutory requirements such as “valid scientific evidence”.

Harmless Error

FDA conceded that there had been a change in position relating to the fourth item—FDA’s review of marketing and risk abatement plans. FDA argued that this was harmless error.

FDA argued that its change in position relating to marketing and risk abatement plans was harmless error because FDA had other grounds upon which to deny the marketing applications. The plaintiffs argued that an error is not harmless unless FDA was otherwise required to deny the applications and that remand is the mandatory remedy.[25]

The Court took this opportunity to address some disconnects between possible remedies in an administrative law/harmless error situation. The Court pointed out some inconsistencies in current law and also determined that both parties were overreaching in their positions. The Supreme Court remanded the case to the  Fifth Circuit to assess the harmless error issue using a more intermediate legal analysis advanced by either party.

FDA’s Authority to Determine the Nature of the Evidence Needed to Establish Safety and Efficacy

In language important well beyond the TCA area, the Supreme Court decision supports FDA’s broad discretion to determine the nature or type of scientific evidence it would accept in determining what constitutes valid scientific evidence (or similar terms and requirements). The Court held: “The TCA leaves it to the FDA to decide what constitutes a ‘well-controlled investigation’ or other ‘valid scientific evidence’ that is sufficient [to evaluate the tobacco product and its risks and benefits].”[26]

Note the similarity of the TCA language regarding “valid scientific evidence,” “protection of public health,” etc. to the approval requirements for medical products such as drugs and devices.[27] In fact, the TCA even uses the term “substantially equivalent”[28]—language remarkably close to the 501(k) standard for medical devices.[29] Challenges to FDA’s requirements for the types of evidence needed to satisfy these types of requirements may well be governed by this decision.

Method for Developing Regulatory Standards

Early in the opinion, the Supreme Court addressed an argument mentioned in the plaintiffs’ briefing—namely that FDA is obligated to use notice and comment rulemaking to create or enunciate regulatory standards or requirements. While the Court stated that it was not deciding this issue as it was not part of the grant of certiorari, the Court did express some views on this question.[30] The Court stated that, absent Congressional mandate, “agencies are generally free to develop regulatory standards ‘either by general [legislative] rule or by individual order’ in an adjudication.”[31]

The implications of this language (and the related discussion in the case) is that, unless Congress mandates that regulatory standards for a particular matter can ONLY be developed via notice and comment rulemaking, FDA has the option to use notice and comment ruling making or can use other tools such as decisions on submissions or enforcement actions to establish regulatory standards or requirements.

As the current FDA leadership reassesses staffing levels, resources, and regulatory approaches, one might see an increased use of adjudicative processes such as submission decisions or enforcement actions, rather than formal notice and comment rulemaking or the development of guidance documents, to enunciate regulatory standards. The adjudicative processes may require fewer resources than notice and comment rulemaking or guidance development.[32]

Interestingly, the Supreme Court did not seem to differentiate actual regulations from guidance documents. According to the Court, the plaintiffs argued that guidance documents created regulatory requirements or standards that were binding on FDA and sponsors. And yet each modern guidance document starts with the “black box” reminder that guidance documents do not create binding rights or obligations on the part of FDA or the regulated community. The role of guidance documents in assessing or applying the change-in-position doctrine, as compared to the role of actual regulations, remains to be explored in more detail in future cases.

Impact

This case impacts two major aspects of FDA practice.

First, if one is engaged, on whatever side, in tobacco regulatory work, this case reinforces FDA’s actions in denying a substantial number of market authorization submissions for e-cigarettes and vaping devices using dessert, candy or fruit flavors. Future submissions will need to meet FDA’s evidentiary expectations as upheld by the Supreme Court.

Second, even if one is not involved in tobacco regulation, this case provides important clarity and insights into some key administrative law matters.

Specifically, this case lays out the Court’s latest thinking on the change-in-position doctrine. Stakeholders on all sides often complain (or celebrate) some real or perceived change in FDA’s position on some important issues. One must understand the change-in-position doctrine to understand whether such FDA action meets the Court’s definition of a change-in-position and, if so, how FDA’s actions should be analyzed to determine if such a change is valid.

The case also provides important insights into the harmless error doctrine.

Importantly, the case also outlines the discretion that FDA has to determine how one demonstrate that a product should be approved or cleared including what constitutes “valid scientific evidence.”

 

[1]   Ralph F. Hall is currently the managing member of Hall Strategies, LLC, and, in that role, advises clients on FDA policy and strategy matters involving the agency, Congress and other stakeholders. He has previously been a Principal with Leavitt Partners, a Professor of Practice at the University of Minnesota Law School, General Counsel of a large medical device company, and CEO of a start-up research entity.

[2]   Food & Drug Admin. v. Wages and White Lion Invs., L.L.C., 604 U.S. ____ (2025) [hereinafter Wages and White Lion].

[3]   See Wages and Lion, at p. 4 for a list of these various congressional acts.

[4]   FDA v. Brown and Williamson Tobacco Corp., 529 U.S. 120 (2000). This decision also provides detail on past efforts to regulate, or not regulate, cigarettes.

[5]   Codified at 21 U.S.C. § 387 et seq.

[6]   Regulation of Electronic Nicotine Delivery Systems (Including E- Cigarettes) and the Continuum of Nicotine-Delivering Products, 81 Fed Reg. 29028 (May 10, 2016).

[7]   21 U.S.C. § 387j(c)(2)(A).

[8]   21 U.S.C. § 387j(c)(4).

[9]   Wages and White Lion, at p. 2.

[10] 41 F.4th 427 (5th Cir. 2022)

[11] 90 F.4th 357 (5th Cir. 2024).

[12] Justice Sotomayer filed a one-page concurring opinion simply asserting that rather than “feeling its way” toward a final position, FDA was giving applicants some flexibility in how to meet the requirements. Wages and White Lion, Justice Sotomayor concurrence, p. 1.

[13] Amici supporting the plaintiffs offered other grounds to uphold the Fifth Circuit, including, for example, unconstitutional delegation of lawmaking power to FDA, vagueness, denial of due process, and the “major questions doctrine.” Because these issues were not properly before the Supreme Court, the Court offered no opinion or analysis of these issues. Wages and White Lion, at pp. 19–20 n.3.

[14] The liquid used in a vaping device as the source for the nicotine and, potentially, for flavoring could come in a liquid form requiring the user to manually refill the reservoir or tank in the vaping device (a so-called “open system,” or can came in a pre-packaged cartridge that is apparently easier for the user to use (a “closed system”).

[15] Because the plaintiffs had marketing authorizations denied, the plaintiffs had standing to challenge FDA’s actions. The question of whether some patient group or competitor could raise the same issue triggers standing questions not relevant to this specific case.

[16] The Supreme Court explicitly said that there are two questions. We will follow their language but recognize the existence of these sub questions. Wages and White Lion, at p. 23.

[17] Wages and White Lion, at p. 24 (citing FCC v. Fox Television Stations, Inc., 556 U.S. 502, 515 (2009)).

[18] While unstated by the Court, it would seem that there some other key questions a court must resolve after determining whether FDA has, in fact, made a change in position. For example, a reviewing court may need to determine whether FDA’s new approach is within its jurisdictional boundaries, whether FDA’s new position is contrary to law, and whether FDA’s new position crosses any constitutional bounds.

[19] Encino Motorcars, LLC v Navarro, 579 U.S. 211 (2016). While unspoken, it seems that the Court and the parties agree that the change must be material before the change-in-position doctrine is relevant.

[20] Administrative agencies generally have significant enforcement discretion. It is unclear when the exercise of enforcement discretion becomes a change-in-position.

[21] Wages and White Lion, at p. 23.

[22] Id. at pp. 24, 40.

[23] Wages and White Lion, at p. 32.

[24] Id. at pp. 9–10. Note that Justice Sotomayer’s concurrence stated that FDA was not “feeling its way” but rather had definition positions. Wages and White Lion, Justice Sotomayor concurrence.

[25] This position is based on cases such as Calcutt v. FDIC, 598 U.S. 623 (2023).

[26] Wages and White Lion, at p. 26.

[27] See, e.g., 21 U.S.C. § 355(d).

[28] 21 U.S.C. §§ 387j(a)(2)–(3),

[29] See 21 U.S.C. §360(k); 21 U.S.C. §360(c).

[30] “We did not grant certiorari on that question [the notice and comment ruling making position asserted by plaintiffs], and without adequate briefing, it would not be prudent to decide it here.” Wages and White Lion, at p. 19.

[31] Id. at p. 19 (quoting and citing SEC v. Chenery Corp., 332 U.S. 194, 202–203 (1947)).

[32] The general practice of FDA lawyers and regulatory experts to monitor warning letters, submission decisions, etc. is well warranted and may only become more important.