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Price v. Philip Morris12/15/2005
ary private agreement made thirty years ago." Virden, 304 F. Supp. 2d at 846. The Paldrmic court reasoned: "while it may be true that the cigarette companies preferred an agreement to a regulation, the fact remains that they entered into the agreement voluntarily." Paldrmic, 327 F. Supp. 2d at 966. These courts, therefore, reasoned:
"On some level the FTC clearly has coercive control over the tobacco companies' tar and nicotine advertising based on its power to regulate deceptive advertising. However, in this Court's opinion, neither the right to control, nor the threat of taking control, constitutes the direct and detailed control required for the application of federal officer removal jurisdiction." Virden, 304 F. Supp. 2d at 846-47.
See Paldrmic, 327 F. Supp. 2d at 966.
I disagree with the reasoning in Watson, on which the court relies, and agree with the better-reasoned decisions such as Paldrmic and Virden.
In light of the above, I believe that a proper statutory construction analysis leads to the conclusion opposite to that reached by the majority. The analysis must begin with our Consumer Fraud Act, viewed as a whole. Its plain language mandates expansive coverage and the use of judicial construction to effectuate that mandate. Section 10b of the Consumer Fraud Act exempts from the Act conduct "specifically authorized by laws administered by" Illinois or federal regulatory bodies. In this case, the two consent orders upon which PMUSA relies, directed at other parties, did not establish an industrywide standard of conduct for PMUSA. Stated simply, PMUSA did not carry its burden in proving the existence of this affirmative defense.
Further, regardless of how the FTC views the role of consent orders in industrywide rulemaking, for purposes of the Consumer Fraud Act, including section 10b(1), a court may not expand the exemption of section 10b(1) by implication. I do not believe that the consent orders in this case are sufficient to "specifically authorize" PMUSA's use of the disputed descriptors, so as to exempt that conduct from the statutorily mandated expansive scope of the Consumer Fraud Act.
III. Damages
Although I could end my dissent here, I feel compelled to address the special concurrence's suggestion that reversal is warranted for a "more basic reason" than section 10b(1). The special concurrence claims that plaintiffs failed to establish that they sustained actual damages and suggests the absence of actual damages is an alternate basis for the result the majority reaches. The special concurrence applies the wrong measure of damages, however, to plaintiffs' consumer fraud claim. A proper application of the law to the facts at issue leads to the conclusion that the alternate basis suggested by the special concurrence is lacking in merit.
The special concurrence begins with a frank assessment of the deceptive practices employed by PMUSA in promoting its cigarette products:
"The record in the case before us shows that PMUSA developed and marketed Marlboro Lights and Cambridge Lights cigarettes in response to heightened public concern over health risks posed by smoking. The company believed that it could forestall declining sales by offering a product which consumers perceived as better for them than conventional `full-flavored' brands. Pursuant to that strategy, PMUSA advertised Marlboro Lights and Cambridge Lights cigarettes in a way that led consumers to believe that the brands posed a lower health risk than their `full flavored' counterparts. In reality, and as PMUSA was fully aware, the so- called `light' cigarettes not only offered no health benefits, but were actually more toxic."
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