Bates v. Oregon Health Authority ( 2024 )

464 October 16, 2024 No. 729
IN THE COURT OF APPEALS OF THE
STATE OF OREGON
Paul BATES,
an individual,
and No Moke Daddy, LLC,
doing business as Division Vapor,
a corporation,
Plaintiffs-Appellants,
v.
OREGON HEALTH AUTHORITY,
and Patrick Allen, in his official capacity as
Director of Oregon Health Authority,
Defendants-Respondents.
Multnomah County Circuit Court
21CV33671; A180270
Leslie G. Bottomly, Judge.
Argued and submitted February 21, 2024.
John Thorpe, Arizona, argued the cause for appellant.
Also on the briefs was Herbert G. Grey.
Carson L. Whitehead, Assistant Attorney General,
argued the cause for respondent. Also on the brief were Ellen
F. Rosenblum, Attorney General, and Benjamin Gutman,
Solicitor General.
Before Shorr, Presiding Judge, Mooney, Judge, and Pagán,
Judge.
SHORR, P. J.
Reversed and remanded.
Cite as 335 Or App 464 (2024) 465
SHORR, P. J.
Plaintiffs brought a free speech challenge to ORS
431A.175(2)(f) and OAR 333-015-0357, which restrict the
packaging of inhalant delivery systems, seeking declara-
tory and injunctive relief. On cross-motions for summary
judgment, the trial court granted defendants’ motion and
dismissed the action, concluding that the statute was not
facially unconstitutional and that the trial court did not
have jurisdiction to adjudicate plaintiffs’ challenge to the
administrative rule. Plaintiffs appeal from the judgment
dismissing their claims. We conclude that ORS 431A.175
(2)(f) violates Article I, section 8, of the Oregon Constitution,
and we therefore reverse and remand.
I. BACKGROUND AND PROCEDURAL HISTORY
In 2015, the legislature passed House Bill (HB)
2546, which addressed a number of issues involving “inhal-
ant delivery systems,”1 commonly known as “vape pens” or
“e-cigarettes.” Or Laws 2015, ch 158. The bill, among other
things, outlawed the sale of such products to minors, banned
vaping indoors by adding inhalant delivery systems to the
Oregon Indoor Clear Air Act, and, as relevant to the current
matter, created certain requirements surrounding the sale
and packaging of inhalant delivery systems. Id.2
1
“Inhalant delivery system” means:
“(i) A device that can be used to deliver nicotine or cannabinoids in the
form of a vapor or aerosol to a person inhaling from the device; or
“(ii) A component of a device described in this subparagraph or a sub-
stance in any form sold for the purpose of being vaporized or aerosolized by a
device described in this subparagraph, whether the component or substance
is sold separately or is not sold separately.”
ORS 431A.175(1)(a)(A).
2
At the time HB 2546 was passed, inhalant delivery systems were not yet
regulated on the federal level. Effective August 2016, the FDA issued a final
rule deeming electronic nicotine delivery systems, including “e-cigarettes,” to be
subject to chapter IX of the Federal Food, Drug, and Cosmetic Act, the Tobacco
Control Act. Deeming Tobacco Products To Be Subject to the Federal Food, Drug,
and Cosmetic Act, 81 Fed Reg 28,974 (May 10, 2016) (codified at 21 CFR Parts
1100, 1140, 1143). In so doing, the FDA made qualifying vaping products subject
to the same requirements that other tobacco products must comply with, such as
age limits and warning labels regarding the addictive nature of nicotine. Id. The
FDA has also prioritized enforcement of its policies as it relates to the impact
on minors’ access to and use of such products. See Enforcement Priorities for
Electronic Nicotine Delivery Systems and Other Deemed Products on the Market
Without Premarket Authorization, 85 Fed Reg 23,973 (Apr 30, 2020) (noting
466 Bates v. Oregon Health Authority
ORS 431A.175(2)(f), enacted as a part of HB 2546,
states:
“It is unlawful:
“* * * * *
“(f) To distribute, sell or allow to be sold an inhalant
delivery system if the inhalant delivery system is packaged
in a manner that is attractive to minors, as determined by
the [Oregon Health Authority] by rule.”
The Oregon Health Authority (OHA) subsequently pro-
mulgated a number of regulations regarding packaging of
inhalant delivery systems, including OAR 333-015-0357,
which stated:
“(1) An inhalant delivery system is packaged in a
manner that is attractive to minors if because of the pack-
aging’s presentation, shape, graphics, coloring or writing,
it is likely to appeal to minors.
“(2) The Authority considers the following non-
exclusive list to be likely to appeal to minors:
“(a) Cartoons;
“(b) Celebrities, athletes, mascots, fictitious charac-
ters played by people, or other people likely to appeal to
minors;
“(c) Food or beverages likely to appeal to minors such
as candy, desserts, soda, food or beverages with sweet fla-
vors including fruit or alcohol;
“(d) Terms or descriptive words for flavors that are
likely to appeal to minors such as tart, tangy, sweet, cool,
fire, ice, lit, spiked, poppin’, juicy, candy, desserts, soda,
sweet flavors including fruit, or alcohol flavors; or
“(e) The shape of any animal, commercially recogniz-
able toy, sports equipment, or commercially recognizable
candy.”3
FDA’s intent to prioritize enforcement actions against flavored, cartridge-based
products, products for which manufacturers had failed to take adequate mea-
sures to prevent minors’ access to, and products targeted to minors or likely to
promote use by minors). We note that our decision here does not affect retailers’
obligation to comply with federal law.
3
OAR 333-015-0357 was amended in 2023. Because we conclude that the
authorizing statute is unconstitutional and do not reach the merits of the rule
Cite as 335 Or App 464 (2024) 467
Plaintiffs filed a complaint in circuit court seek-
ing declaratory and injunctive relief, asserting that ORS
431A.175(2)(f) and the regulations promulgated by OHA
violated Article I, section 8, of the Oregon Constitution4
by impermissibly infringing upon the right to free speech
through the prohibition of truthful, nonmisleading com-
munication of information about legal products based on
the content of the communications. Plaintiffs additionally
alleged that the statute and regulations were overbroad
because they mandated the censorship of more speech than
was necessary to protect minors, and were unconstitution-
ally vague because they failed to give people reasonable
notice about what was permitted and what was forbidden.
Defendants filed a motion for summary judgment,
asserting that the circuit court did not have jurisdiction to
review the facial validity of administrative rules, and main-
taining that ORS 431A.175(2)(f) did not violate Article I,
section 8. Plaintiffs opposed the motion and filed their own
cross-motion for summary judgment.
The circuit court agreed with defendants that it did
not have jurisdiction over plaintiffs’ challenge to the reg-
ulations, noting that “a ‘facial’ challenge to an agency reg-
ulation must be brought in the Court of Appeals under the
[Oregon Administrative Procedures Act].” The court further
concluded that, applying the framework set forth in State v.
Robertson, 293 Or 402, 649 P2d 569 (1982), for evaluating free
speech claims, the statute was not subject to a facial challenge
because it did not expressly regulate speech, even though it
may have had the effect of prohibiting or limiting speech. The
court rejected plaintiffs’ vagueness challenge without dis-
cussion. The court therefore granted defendants’ motion for
summary judgment and denied plaintiffs’ cross-motion, and
dismissed the claims.
On appeal, plaintiffs argue that the circuit court
erred in granting defendants’ motion for summary judgment,
raising four assignments of error. Plaintiffs assert that the
challenge, the amendment does not affect our analysis. All references in this
opinion are to the version in effect at the time this action was filed.
4
Article I, section 8 states: “No law shall be passed restraining the free
expression of opinion, or restricting the right to speak, write, or print freely on
any subject whatever[.]”
468 Bates v. Oregon Health Authority
trial court erred by: (1) concluding that ORS 431A.175(2)(f)
does not violate Article I, section 8; (2) failing to address
whether ORS 431A.175(2)(f) is unconstitutionally vague;
(3) concluding that it lacked jurisdiction over the challenge
to the regulations; and (4) failing to conclude that the regu-
lations are unconstitutional. Defendants maintain that the
circuit court did not err in any of those respects.
II. ARTICLE I, SECTION 8 ANALYSIS
A. Standard of Review
Whether a statute is facially invalid because it
unconstitutionally restricts speech in violation of Article I,
section 8, is a question of law that we review for legal error.
Couey v. Clarno, 305 Or App 29, 33, 469 P3d 790 (2020),
rev den, 367 Or 496 (2021).
B. Robertson Framework
We begin with the framework for evaluating
Article I, section 8, claims, as established in Robertson. We
first identify the three categories of laws in the Robertson
framework:
“The first Robertson category encompasses any law that is
‘written in terms directed to the substance of any “opinion”
or any “subject” of communication.’ [Robertson, 293 Or at
412]. Laws in that category are unconstitutional on their
face, ‘unless the restriction is wholly confined within an
historical exception.’ Id. The first category encompasses
only statutes that expressly prohibit speech.
“The second Robertson category also encompasses only
statutes that expressly prohibit speech. A law falls within
the second category if it expressly regulates speech but is
directed to forbidden effects or harms of the proscribed
speech and not to the substance of the communication
itself. Id. at 415. Laws that fall within the second Robertson
category are analyzed for overbreadth and are held to be
facially invalid if they are overbroad. Id.“The third Robertson category describes laws that do
not expressly restrict speech but that may have the effect
of prohibiting or limiting it. Laws in the third category
are not facially invalid, but they are subject to as-applied
challenges.”
Couey, 305 Or App at 34-35.
Cite as 335 Or App 464 (2024) 469
The parties dispute which category this statute
falls under. Plaintiffs argue that ORS 431A.175(2)(f) is a
category one law because it restricts a medium of expression
(the package) in terms of the message or expressive content;
alternatively, plaintiffs argue that it is a category two law
aimed at reducing minors’ use of inhalant delivery systems
by expressly proscribing speech. Defendants maintain that
the statute by its plain terms does not restrict expression
because there is nothing inherently expressive about the
distribution or sale of a product and packaging is not inher-
ently expressive; therefore, the law may only be challenged
in an as-applied posture pursuant to Robertson category
three when it has the effect of reaching speech.5
We therefore must determine whether the prohibi-
tion on sales of inhalant delivery systems that are packaged
in a manner that is attractive to children is a law “directed
by its terms at restraining or restricting speech or expres-
sion.” City of Nyssa v. Dufloth/Smith, 339 Or 330, 338, 121
P3d 639 (2005).
C. Application
As noted above, ORS 431A.175(2)(f) makes it
unlawful “to distribute, sell or allow to be sold an inhalant
delivery system if the inhalant delivery system is packaged
in a manner that is attractive to minors, as determined by
[OHA] by rule.” We conclude that the statute is written in
terms directed to the substance of a communication and is
therefore a Robertson category one law.
In interpreting a statute, we engage in our well-
established methodology of considering the text in context
and any helpful legislative history. State v. Gaines, 346 Or
160, 171-72, 206 P3d 1042 (2009). We engage in that process
here to determine precisely what is being regulated. The
action that is proscribed by the statute is the distribution,
sale, or allowance of the sale of the restricted products. The
Supreme Court has held that “[s]elling is a form of communi-
cative behavior that includes speech and may involve goods
that are protected expression.” City of Hillsboro v. Purcell,
5
As defendants correctly note, plaintiffs have not asserted an as-applied
challenge to the statute.
470 Bates v. Oregon Health Authority
306 Or 547, 555, 761 P2d 510 (1988); see also City of Eugene
v. Miller, 318 Or 480, 485, 871 P2d 454 (1994) (citing Purcell
and noting that restrictions on selling can implicate speech).
We conclude that the phrasing of the statute in terms of reg-
ulating the sale of certain products does not by itself render
the statute one that does or does not restrict expression.
We therefore turn to the phrase “packaged in a
manner that is attractive to minors.” When words are
not defined in a statute, we presume that the legislature
intended for them to have their ordinary meanings. Gaines,
346 Or at 175. “Attractive” is defined as “1a: able to cause
(a person or animal) to approach by influencing the will or
appealing to the senses * * * 2: having qualities that arouse
interest, pleasure, or affection in the observer : pleasing[.]”
Webster’s Third New Int’l Dictionary 141 (unabridged ed
2002). Defendants assert that there is nothing inherently
expressive about packaging in and of itself, that it could be
plain or something purely functional. However, we conclude
that the word “attractive,” as it refers to the manner in which
a product is packaged, refers to the packaging’s expressive
content: those expressive qualities of the packaging, such
as words, color, images, or design that may draw a minor
to a product or arouse their interest. It does not refer to the
utility or function of the package. We do not find persuasive
defendants’ assertion that the word “attractive” could have
been intended to refer to nonexpressive elements of pack-
aging, such as bundling an inhalant delivery system with
a toy.6 We conclude that the “attractiveness” of the manner
of packaging is expressive speech. The statute therefore is
a direct restriction of that speech, making it a Robertson
category one law.
We disagree with defendants’ characterization of
the Supreme Court’s opinion in State ex rel Rosenblum v.
Living Essentials, LLC, 371 Or 23, 56-57, 529 P3d 939 (2023),
as concluding that packaging is not inherently expressive.
6
We have been unable to locate any clear legislative history that explains
the meaning of ORS 431A.175(2)(f) other than a single Senate floor statement
referring to the intentional targeting of inhalant delivery systems to children
through advertisements, kid-friendly flavors, and “flashy packaging.” Video
Recording, Senate Chamber, HB 2546, May 11, 2015, at 0:36:02 (comments of
Sen Elizabeth Steiner Hayward).
Cite as 335 Or App 464 (2024) 471
In discussing a statute that prohibited a person or business
from causing “likelihood of confusion or of misunderstand-
ing as to the source, sponsorship, approval, or certification
of real estate, goods or services,” and concluding that the
statute did not regulate speech, the court stated:
“We have never held that all conduct associated with the
sale of goods and services is expressive. Here, the statute
could reach such things as the manner in which products
are packaged, the location at which they are sold, or even
where they are placed on a store shelf, if a likelihood of con-
fusion or misunderstanding were likely to result.”
Living Essentials, LLC, 371 Or at 56-57. Contrary to defen-
dants’ assertion that that passage demonstrates that “the
regulation of packaging is not the regulation of expression,”
we interpret the passage as referring to the clearly non-
expressive elements of packaging, similar to physical place-
ment. In the matter at hand, the word “attractive” is what
renders the restriction on packaging a restriction on expres-
sive content.
We take guidance from City of Portland v. Tidyman,
306 Or 174, 759 P2d 242 (1988). In that case, the city had
enacted a zoning ordinance that required adult bookstores
to be located at least 500 feet from any residential zone
and, in some cases, at least 1,000 feet from any other adult
business, defining adult bookstores as establishments that
had a substantial or significant portion of their merchan-
dise depicting sexual activities or nudity. Id. at 177-78, 181.
The ordinance’s introduction purported to address the col-
lateral impact of adult businesses and associated blighted
conditions. Id. at 184-85. The ordinance did not prohibit
the adult bookstores from locating within the city, nor did it
purport to limit the content of the materials for sale in the
stores. Nonetheless, the Supreme Court held that, in light
of the fact that an establishment became prohibited based
on the quantity of adult merchandise sold, the ordinance
was “flatly directed against one disfavored type of pictorial
or verbal communication.” Id. at 184-85. In response to the
city’s arguments regarding the ordinance’s intended pur-
pose of regulating the effect of speech and not the speech
itself, the court noted:
472 Bates v. Oregon Health Authority
“If the ordinance were so written, it might well be valid on
its face and subject only to scrutiny for valid administra-
tion; but it is not so written. * * * [The ordinance] under-
takes to prevent what the city believes to be the effects of
the trade in sexually explicit verbal or pictorial material
by describing the content of this communicative material.”
Id. at 184. The court went on to note that, even though the
city had made legislative findings to support the premises
for the ordinance, “[i]t is the operative text of the legisla-
tion, not prefatory findings, that people must obey and that
administrators and judges enforce.” Id. at 185.
We additionally note and distinguish the Supreme
Court’s decision in State v. Stoneman, 323 Or 536, 920 P2d
535 (1996). In that case, the court grappled with the constitu-
tionality of a statute that criminalized the purchase of a lim-
ited and specific kind of pornographic material that depicted
actual children engaged in sexually explicit conduct. Id. at
539. We had initially determined that the statute was an
unconstitutional Robertson category one statute, because it
focused on the content of the materials that it regulated and
made no mention of preventing any supposed harmful effect.
Id. at 544. The Supreme Court disagreed, acknowledging
that although the statute appeared to have contained a
content-based proscription on expressive material, the stat-
ute could not be read in a vacuum, and in examining that
context, the court noted that the prohibited materials in that
case necessarily involved harm to children—they owed their
very existence to the commission of sexual abuse of a child
and the commerce of those materials was an extension of that
harmful act. Id. at 545-46. The court concluded that the stat-
ute “prohibited the purchase of certain communicative mate-
rials, not in terms of their communicative substance, but in
terms of their status as the products of acts that necessarily
have harmed the child participants.” Id. at 548. Because the
statute was directed at preventing the harm of child sexual
exploitation, the court analyzed it as a Robertson category
two law and assessed it for overbreadth, concluding that it
was constitutionally valid. Id. at 550.
We view the present case as more similar to
Tidyman than Stoneman: the statute at issue here regulates
Cite as 335 Or App 464 (2024) 473
expression based on its content, not the effect. The parties do
not dispute that limiting minors’ use of vaping products is a
legitimate legislative purpose. We agree. The circuit court
correctly found that there was undisputed evidence that
vaping products have harmful effects on children. Again, we
agree. The circuit court also took note of legislative materials
indicating the legislature’s purpose of limiting the harmful
health effects on minors caused by using nicotine and vaping
products, both from an addiction and health perspective and
in terms of the dangers of accidental ingestion. Other provi-
sions of HB 2546 and other statutes are specifically directed
toward those goals, including those that outlaw the sale of
the products to minors, require products to be inaccessible
to patrons without employee assistance unless minors are
not permitted in the establishment, and require all inhal-
ant delivery systems to be packaged in child-resistant safety
packaging. ORS 167.755; ORS 167.765; ORS 431A.175(2)(e).
Plaintiffs do not argue before us that those aspects of the law
are unconstitutional. They challenge ORS 431A.175(2)(f).
However, ORS 431A.175(2)(f) is only concerned with
the expressive content of the packaging of products legally
sold to consenting adults. If the products are packaged in a
manner that is not attractive to minors, the sale is lawful;
if they are packaged otherwise, the sale is unlawful. The
law therefore restrains expression and does not regulate the
effect of a sale to a minor or a minor’s later use of the prod-
uct. In Tidyman, the court noted:
“the operative text of the ordinance does not specify adverse
effects that constitute the ‘nuisance’ attributable to the sale
of ‘adult’ materials and therefore does not apply only when
these adverse effects are shown to occur or imminently
threaten to occur. * * * By omitting the supposed adverse
effects as an element in the regulatory standard, the ordi-
nance appears to consider the ‘nuisance’ to be the char-
acteristics of the ‘adult’ materials rather than secondary
characteristics and anticipated effects of the store. Such
lawmaking is what Article I, section 8, forbids.”
Tidyman, 306 Or at 185-86. Here, whether a sale or dis-
tribution violates the statute turns on the substance of the
packaging itself rather than on any resulting effect. Unlike
in Stoneman, there is nothing about the expressive content
474 Bates v. Oregon Health Authority
being regulated here that necessarily involves harm to chil-
dren. Absent an established correlation between the packag-
ing and the actual harm of minors using inhalant delivery
systems, the law is not directed at a forbidden effect or harm
of the regulated speech. The rationale of Tidyman supports
our conclusion that ORS 431A.175(2)(f) is a category one law.
See also Living Essentials, LLC, 371 Or at 46-47 (concluding
that the portion of the statute at issue that made it unlawful
to represent that real estate, goods or services had attri-
butes that they did not actually have was a category one law
because it prohibited speech based on its substance rather
than on any resulting effects).
We are not persuaded by defendants’ argument that
the statute itself contains no operative prohibition on speech
because it did not take effect until OHA promulgated rules
determining what qualifies as “attractive to minors.” As the
above analysis demonstrates, the statute is a prohibition on
the sale of certain expressive materials. The fact that OHA
had to promulgate rules in order to establish which kinds
of expressive packaging it deemed attractive to minors does
not make the statute itself any less of a law “restricting the
right to speak, write, or print freely on any subject what-
ever,” in contravention of Article I, section 8.
We thus turn to the final step of analysis under
Robertson to consider whether the law falls within a his-
torical exception to the prohibition of Article I, section 8.
Robertson, 293 Or at 412. Examples include “perjury, solic-
itation or verbal assistance in crime, some forms of theft,
forgery and fraud and their contemporary variants.” Id.Defendants do not suggest any basis for finding this law
to fall within any historical exception and we are aware
of none. We therefore conclude that ORS 431A.175(2)(f) is
unconstitutional on its face.
III. REMAINING ASSIGNMENTS OF ERROR
Plaintiffs assert in their second assignment of
error that ORS 431A.175(2)(f) is unconstitutionally vague.
Because we have already determined that the statute vio-
lates Article I, section 8, we need not reach the vagueness
argument.
Cite as 335 Or App 464 (2024) 475
Plaintiffs’ third assignment of error is an assertion
that the trial court erred when it concluded that it lacked
jurisdiction over plaintiffs’ challenge to the OHA regula-
tions. The trial court did not err in that respect. A facial chal-
lenge to an agency’s rules must be brought under the APA,
which vests jurisdiction for such actions in this court, not
the circuit court. ORS 183.400(1); see also Pacific Northwest
Bell Telephone Co. v. Eachus, 107 Or App 539, 543-44, 813
P2d 46 (1991) (acknowledging that a circuit court could
have jurisdiction to adjudicate the validity of an adminis-
trative rule if such resolution was required for determina-
tion of another matter properly before the circuit court, but
noting that in that case there was “no separate civil action
that places a rule’s validity at issue. A direct challenge to a
rule must be brought in [the Court of Appeals] under ORS
183.400.”). Plaintiffs’ action did not raise any separate mat-
ters requiring resolution of the validity of the regulations; it
simply requested a determination that the regulations were
unconstitutional. Therefore the circuit court did not have
jurisdiction.
Because the circuit court did not have jurisdiction to
adjudicate plaintiffs’ facial challenge to the regulations, we
do not reach the merits of the regulations’ constitutionality.
Id. at 542 (“If * * * the circuit court never had jurisdiction,
[the] appeal from that judgment only confers jurisdiction on
this court to decide the jurisdictional issue.”).7
IV. CONCLUSION
In summary, we conclude that ORS 431A.175(2)(f)
is an unconstitutional restriction of speech under Article I,
section 8, and we therefore reverse the circuit court’s judg-
ment dismissing the action. We additionally note that the
correct disposition of a declaratory judgment claim is to
enter a judgment declaring the parties’ rights. De Lanoy v.
Taylor, 300 Or App 517, 520, 452 P3d 1036 (2019) (When a
“party asks for a declaration, it is incumbent on the court to
declare the respective rights of the parties.”). Accordingly,
on remand, the trial court must enter a judgment consistent
7
We acknowledge that, in light of our holding that ORS 431A.175(2)(f) is
unconstitutional, the regulations implementing it necessarily will be affected.
476 Bates v. Oregon Health Authority
with this opinion and declaring the rights of the parties
under the law.
Reversed and remanded.