Ashlynn Marketing v. Pan
3:25-cv-01430
| S.D. Cal. | Jul 16, 2025Background
- Ashlynn Marketing is a California-based company manufacturing and distributing kratom products, with about 80% of sales to out-of-state customers.
- The FDA has declared kratom an unsafe food additive, issuing an import alert in early 2025; California Department of Public Health (DPH) embargoed over $2 million of plaintiff’s kratom under state food safety statutes.
- Plaintiff sought a preliminary injunction on grounds that the embargo unlawfully burdens and discriminates against interstate commerce, violating the dormant Commerce Clause.
- Plaintiff asserts that continued embargo will force it to shut down and lay off 30 employees; Defendants argue there is a legitimate public safety concern and that Plaintiff failed to satisfy the standard for a preliminary injunction.
- The court considered the motion using the Winter v. NRDC framework: likelihood of success, irreparable harm, balance of equities, and public interest.
- The court denied the preliminary injunction, finding Plaintiff failed to show likelihood of success on the merits or a likelihood of irreparable harm.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Discrimination under dormant Commerce Clause | Embargo impedes interstate sales, harming out-of-state flow | No discrimination—applies equally in-state/out | No discrimination; embargo is facially neutral |
| Extraterritorial effect (regulation outside California) | Embargo unlawfully regulates commerce in other states | Embargo only restricts conduct entirely in CA | No extraterritorial regulation; embargo is local |
| Excessive burden on interstate commerce (Pike test) | Embargo substantially burdens interstate kratom trade | No substantial burden; action addresses safety | No substantial burden shown; claim not persuasive |
| Irreparable harm | Risk of business closure and layoffs | Economic loss remediable; no compelling evidence | No likelihood of irreparable harm demonstrated |
Key Cases Cited
- Winter v. NRDC, Inc., 555 U.S. 7 (standard for preliminary injunctions)
- National Pork Producers Council v. Ross, 598 U.S. 356 (dormant Commerce Clause, Pike balancing)
- Pike v. Bruce Church, Inc., 397 U.S. 137 (state regulation upheld unless burden on interstate commerce is excessive)
- Exxon Corp. v. Governor of Md., 437 U.S. 117 (dormant Commerce Clause does not protect individual market participants)
- Healy v. Beer Inst., 491 U.S. 324 (extraterritoriality doctrine under dormant Commerce Clause)
- Camps Newfound/Owatonna, Inc. v. Town of Harrison, 520 U.S. 564 (antidiscrimination principle of dormant Commerce Clause)
- Department of Revenue of Ky. v. Davis, 553 U.S. 328 (state laws motivated by economic protectionism prohibited)