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Price v. Philip Morris12/15/2005
Authority that all representations regarding tar and nicotine levels in cigarette advertising should be based on recent test results. Finally, because the topic was of substantial public interest, the exchange of correspondence between the FTC and the Code Authority was made public. American Brands, Inc., 77 F.T.C. at 1624.
On April 1, 1970, the Public Health Cigarette Smoking Act became law, making several significant changes to the Labeling Act. Pub. L. 91-222, 84 Stat. 87 (1969). First, since November 1970, all cigarette packages have been required to carry the following warning statement: "Warning: The Surgeon General Has Determined That Cigarette Smoking Is Dangerous To Your Health." Pub. L. 91-222, §4. Second, since January 2, 1971, the Public Health Cigarette Smoking Act has barred cigarette advertising from television and radio. Pub. L. 91-222, §6. And, third, a new preemption provision forbids any "requirement or prohibition based on smoking and health * imposed under State law with respect to the advertising or promotion of cigarettes." Pub. L. 91-222, §5(b). As the new preemption provision was directed only at actions by the states, the FTC remained free to regulate cigarette advertising. See Lorillard Tobacco Co. v. Reilly, 533 U.S. 525, 545, 150 L.Ed. 2d 532, 553, 121 S.Ct. 2404, 2416-17 (2001).
In its 1970 Report to Congress, the FTC described the exchange with the Code Authority under the heading "Voluntary Regulation." The FTC reported that the Code Authority had "adopted as its policy a position similar to the order" that the FTC "believed to be appropriate" as a resolution of its pending complaint against American Brands. The FTC's clearly stated policy was that:
"if a broadcast cigarette advertisement used comparative language such as `low' or `lower' to describe the tar and nicotine content of the advertised cigarette, the advertisement must also disclose:
1. The tar and nicotine content in milligrams of the advertised cigarette;
2. The tar and nicotine content in milligrams of the lowest and highest yield domestic cigarettes; and
3. If the tar and nicotine content of the advertised cigarette is compared to any other specific cigarette, the brand name and tar and nicotine content in milligrams of the smoke produced by such other cigarettes." Federal Trade Commission, Report to Congress Pursuant to the Public Health Cigarette Smoking Act, at 21 (December 31, 1970).
One result of the advisory opinion rendered to the Code Authority, according to the Report, was that several television commercials had been withdrawn and that only two brands made comparative claims in broadcast advertisements during 1970. Federal Trade Commission, Report to Congress Pursuant to the Public Health Cigarette Smoking Act, at 21 (December 31, 1970).
Subsequently, when the formal complaint against American Brands was filed, the FTC accused the company of creating the false impression that its cigarettes were low in tar when, in fact, Pall Mall Gold 100s and Lucky Filters contained approximately 20 and 21 milligrams of tar, respectively, at a time when the brand containing the lowest level of tar contained only 4 milligrams. In re American Brands, Inc., 79 F.T.C. 225 (1971). By this time, the voluntary agreement had been reached, but American Brands had not signed on to it.
The dispute between the FTC and American Brands was resolved in 1971, with the entry of a consent order that required American Brands to cease and desist from:
"Stating in advertising that any cigarette manufactured by it, or the smoke therefrom is low or lower in `tar' by use of the words `low,' `lower,' or `reduced' or
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