RJR Vapor Co., LLC// Glenn Hegar, Comptroller of Public Accounts of the State of Texas The Office of the Comptroller of Public Accounts of the State of Texas And Ken Paxton, Attorney General of the State of Texas v. Glenn Hegar, Comptroller of Public Accounts of the State of Texas The Office of the Comptroller of Public Accounts of the State of Texas And Ken Paxton, Attorney General of the State of Texas// Cross-Appellee, RJR Vapor Co., LLC
RJR Vapor Co., LLC sued the Comptroller of Public Accounts of the State of Texas to recover protested tax payments on its oral nicotine products (VELO pouches and lozenges). The central dispute was whether VELO products are 'tobacco products' under Texas Tax Code Section 155.001(15)(E), which defines such products as 'made of tobacco or a tobacco substitute'. The trial court ruled in favor of RJR Vapor, granting a refund and declaring parts of the statute unconstitutional. On appeal, the Court of Appeals affirmed that VELO products are not taxable tobacco products, thus upholding the refund. The court also vacated the trial court's constitutional declarations and dismissed RJR Vapor's related claims for declaratory and injunctive relief, deeming them moot.