Smoore the Parent Co. to CCELL Hit with Class Action Antitrust Lawsuit, How Price Fixing and Patent Abuse Allegations Could Shake Up the Vape Industry

The cannabis vape industry is facing a legal battle that could reshape its landscape. Shenzhen Smoore Technology Co. Ltd. (parent company of CCELL) and its U.S. distributors (Jupiter Research LLC, Greenlane Holdings, LLC, 3Win Corp., and CB Solutions, LLC) have been hit with a class action lawsuit alleging price fixing, market monopolization, and anti-competitive practices.

Filed in the U.S. District Court for the Northern District of California, the lawsuit—led by Earth’s Healing, Inc.—accuses Smoore and its distributors of engaging in a horizontal agreement that artificially inflated the price of vape hardware, restricted competition, and harmed both cannabis businesses and consumers. The allegations include violations of Section 1 of the Sherman Antitrust Act (15 U.S.C. § 1), which prohibits agreements that restrain trade.

Allegations Against Smoore:

Price Fixing & Market Control

• Smoore and its distributors allegedly set minimum pricing for vape hardware and agreed not to compete with each other, effectively creating a monopoly in the U.S. vape market.
  
• This allowed them to artificially inflate prices, limiting market competition and stifling innovation.

No-Compete Agreements

• The lawsuit claims that Smoore’s distributors agreed not to undercut each other’s prices or compete for customers.
  
• By enforcing these agreements, they allegedly prevented smaller vape hardware companies from entering or thriving in the industry.

Weaponizing Patent Litigation

• In 2021, Smoore filed a U.S. International Trade Commission (ITC) proceeding against over 30 U.S. vape hardware companies, including ACTIVE (Next Level Ventures LLC).
  
• While the ITC ultimately ruled against Smoore, many businesses were forced out of the market due to costly legal battles
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• Despite this, Smoore continued its aggressive litigation tactics, leading to counterclaims filed by competitors in 2024.

Impact on Pricing & Market Competition

• The lawsuit alleges that Smoore’s practices resulted in inflated costs for cannabis companies and consumers.
  
• Businesses that purchased Smoore’s vape hardware reportedly paid artificially high prices, which were ultimately passed down to customers.

ACTIVE’s Response & $200M in Estimated Damages

The class action lawsuit follows prior legal action taken by ACTIVE (Next Level Ventures LLC), which was the first company to challenge Smoore’s alleged anti-competitive tactics.

According to ACTIVE’s President, Michael Brosgart:

The plaintiffs’ price-fixing allegations are no surprise. ACTIVE (Next Level Ventures LLC) was the first party to hold Smoore legally accountable for its anti-competitive conduct, and preliminary expert damages analysis suggests that ACTIVE is entitled to nearly $200 million as the direct result of Smoore’s illegal conduct in the cannabis vape market. The class plaintiffs may be owed even more.”

This suggests that potential damages could extend well beyond $200 million if the class action lawsuit succeeds.

If the court rules in favor of the plaintiffs, the cannabis vape industry could see several major changes:

• Lower Prices for Vape Hardware – If Smoore is forced to abandon its alleged price-fixing agreements, wholesale costs for vape cartridges and hardware may drop significantly.
  
• Increased Competition – A ruling against Smoore could open the market to smaller vape hardware manufacturers, increasing product diversity and innovation.
  
• Regulatory & Legal Scrutiny – This lawsuit may invite federal regulatory attention to business practices in the cannabis vape industry, prompting further investigations.
  
• Reevaluation of Chinese Vape Imports – With Smoore dominating the U.S. vape hardware supply chain, this lawsuit could spur increased demand for American-made alternatives.

What’s Next in Smoore Lawsuit?

With the lawsuit still in its early stages, the industry will be watching closely to see how Smoore and its U.S. distributors respond. If the class action gains traction, it could lead to major financial penalties, stricter regulations, and increased competition in the vape market.

For now, cannabis brands and retailers that have relied on CCELL and other Smoore-made vape products may want to consider alternative suppliers as the case unfolds.

The outcome of this lawsuit could set a major precedent for how cannabis vape companies operate in the U.S. With accusations of price fixing, monopolistic behavior, and aggressive legal tactics, this case is should shake up the industry and potentially bring more transparency and fair competition to vape hardware pricing.

Beard Bros Pharms will continue to monitor the case and provide updates as more details emerge.