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Price v. Philip Morris12/15/2005
lavor cigarettes.
If the use of these descriptive terms in the manner alleged has been specifically authorized by the FTC in the course of carrying out the duties assigned to it by Congress, this action cannot stand, even if the terms might be found deceptive by a trier of fact. 815 ILCS 505/10b(1) (West 1998). Similarly, if these terms have been used by PMUSA in compliance with the orders or rules of the FTC, an action under the Deceptive Practices Act is also barred. 815 ILCS 510/4 (West 1998).
A. Standard of Review
PMUSA suggests that its affirmative defenses raise questions of law and, therefore, the proper standard of review is de novo, citing Woods v. Cole, 181 Ill. 2d 512, 516 (1998). Plaintiffs have not objected to de novo review. We conclude that de novo review is warranted, but not for the reason suggested by PMUSA.
As a threshold matter, we must construe the language of section 10b(1). Statutory construction is a question of law, subject to de novo review. Advincula v. United Blood Services, 176 Ill. 2d 1, 12 (1996). Once the statute is properly construed, its terms must be applied to the circumstances of the individual case to determine whether it bars this action. It is arguably a question of fact whether the FTC did, or did not, specifically authorize the use of certain descriptive terms in cigarette labeling and advertising. Indeed, the circuit court felt it necessary to reserve judgment on the affirmative defenses pending the creation of a factual record at trial. It could, therefore, be argued that the application of section 10b(1) to the facts should be reviewed under a more deferential standard. See, e.g., Carpetland U.S.A., Inc. v. Illinois Department of Employment Security, 201 Ill. 2d 351, 369 (2002) (noting that when the "issue presented cannot be accurately characterized as either a pure question of fact or a pure question of law," it may be properly reviewed under an intermediate standard of review).
We, nevertheless, review de novo the application of section 10b(1) to the facts of this case. Although the circuit court made a finding that the FTC did not specifically authorize the use of the disputed terms, this is not a finding of fact that proceeded from the circuit court's assessment of credibility of witnesses or the weight it chose to give to conflicting pieces of evidence. Rather, the actions of the FTC with relation to the use of these terms in cigarette advertising and labeling are a matter of public record. Thus, the statute is being applied to facts that are essentially undisputed. Because we need not evaluate the credibility of witnesses or weigh conflicting testimony to determine whether the actions of the FTC have resulted in specific authorization of the use of these terms by cigarette manufacturers, we may properly draw our own conclusion on the issue. Steinbrecher v. Steinbrecher, 197 Ill. 2d 514, 523 (2001) (where the question on appeal is limited to application of the law to undisputed facts, the standard of review is de novo).
B. PMUSA's Argument
PMUSA argues that section 10b(1) bars this action based on the FTC's regulatory scheme and Congress' regulation of cigarette advertising through the Labeling Act. Citing this court's decisions in Lanier, 114 Ill. 2d at 17, and Jackson, 197 Ill. 2d at 49, which are discussed in detail below, PMUSA argues that its compliance with federal law, combined with the policy against extending disclosure requirements beyond what is mandated by law, satisfy the requirements of section 10b(1). At oral argument, counsel for PMUSA characterized section 10b(1) as a "safe harbor for those whose conduct does not violate federal law."
In the alte
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