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Price v. Philip Morris12/15/2005
g of a new submarket trend based upon the FTC's official definition of low-tar cigarettes (15 or less milligrams of tar)." See FTC Staff Report, Bureau of Economics, Brand Performance in the Cigarette Industry and the Advantage to Early Entry, at 35 (June 1979). In 1981, the FTC reported to Congress on the conclusion of a study undertaken in 1976, in response to FTC's taking notice of extensive promotion and development of low tar and nicotine cigarettes. According to Dr. Peterman, the staff report "reconfirmed" that FTC "formally defines" low tar as 15 milligrams or less. See FTC Staff Report, Cigarette Advertising Investigation, at 1-50 n.175 (May 1981).
Over plaintiffs' objection, PMUSA was allowed to admit into evidence a copy of a November 24, 1998, letter from Senator Frank R. Lautenberg of New Jersey to then-FTC Chairman Robert Pitofsky. The Senator urged Chairman Pitofsky "to begin a proceeding to suspend the right of tobacco companies to market any cigarettes as `Light' or `Ultra Light' or list supposed nicotine and `tar' ratings on their products and advertisements until and unless an accurate system of measuring the health implications of smoking is established." Lautenberg accompanied the letter with copies of "tobacco industry documents" that provided, in Lautenberg's words, "strong evidence that the tobacco industry knows that the nicotine and tar ratings used to determine what constitutes `Light' cigarettes are false and misleading to consumers." Peterman described the Senator's request as specifically targeting the use of the word "light" as a descriptor by PMUSA and other tobacco companies.
The FTC responded to the letter in a news release, a copy of which was also admitted into evidence. The FTC acknowledged receipt of documents of which it was not previously aware and that the "existing testing methodology both significantly understates actual tar and nicotine intakes and doesn't properly account for differences in tar and nicotine intakes." The FTC also announced that its staff had been working with the Department of Health and Human Services on an informal basis to address these issues and that it had "now formally requested, and HHS has agreed," to conduct a review of the FTC testing methodology and of the "limited health benefits, previously believed to be associated with lower tar and nicotine cigarettes." FTC Statement in Response to Senator Frank Lautenberg's Release of Tobacco Documents, November 24, 1998.
Dr. Peterman then testified that the FTC does regulate the use of the descriptor "lights" and that it permits "the use of the descriptor `lights' in cigarette advertising under certain conditions." He based this conclusion on his expert understanding of the FTC's functions and operations and on the 1971 consent order, the 1995 consent order, and the results of the various FTC investigations and deliberations on the subject of the use of measurements and descriptors of tar in cigarette advertising. He further testified that, based on his investigation and experience, that PMUSA's advertising of Marlboro Lights and Cambridge Lights is in compliance with the FTC requirements. Both cigarettes yield less than 15 milligrams of tar based on the FTC test method and both brands are lower in tar than their full-flavor counterparts, Marlboro Reds and regular Cambridge cigarettes.
Regarding the 1971 American Brands consent order, Dr. Peterman testified that the order was an "official act" of the FTC and that it was published for the purpose of providing guidance to industry members regarding the use of descriptors. He stated that the consent order said to industry members, in effect: "If in the future you use the term `low,' `lower,' or any light qualif
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