BIG TOBACCO: Philip Morris to Pull Ads Targeting Youths
Philip Morris announced yesterday that it will pull ads in 40-50 magazines with a large youth readership, the AP/New York Times reports. The company said it would stop running ads in magazines with more than 2 million readers under age 18 or whose teen readership is more than 15%. Although it will honor existing commitments, the nation's largest cigarette maker pledged to have all ads phased out by September. It also called for the creation of an independent third-party standard to oversee tobacco advertising (6/6). Philip Morris said that by removing its ads from magazines like Rolling Stone, Sports Illustrated, Elle, and Vogue, its actions are "consistent with its commitment to lower the profile of tobacco advertising and its mission to responsibly market its products only to adults" (Reuters/Arizona Republic, 6/5). Christine Gregiore, attorney general for Washington state and president of the National Association of Attorneys General, hailed the announcement. She said, "I'm delighted with the Philip Morris move. ... I think it's very significant" (Fairclough/Rose, Wall Street Journal, 6/6). Gregiore added, "One of the reasons we sued tobacco companies was to stop them from targeting kids to make them the next generation of smokers" (AP/New York Times, 6/6).
Following the Leader?
Matthew Myers, president of the Campaign for Tobacco-Free Kids, echoed Gregiore's praise. He said, "Philip Morris' announcement ... will be a positive step if it represents fundamental and permanent change and is followed by similar action by other tobacco companies" (Reuters/Arizona Republic, 6/5). But it does not look like other cigarette manufacturers will follow suit any time soon. R.J. Reynolds Tobacco Holdings Inc., the nation's second-largest cigarette maker, said it has no plans to reduce its advertising. It said that such a move would not do much to prevent kids from smoking and would "have enormous impact" on the company's ability to compete for adults' loyalty. Other tobacco companies did not comment on Philip Morris' move. But Tommy Payne, Reynolds executive vice president, said, "This is an issue that has enormous competitive consequences" because other companies could be criticized for not following Philip Morris' lead. Last year, cigarette companies spent $442.7 million on magazine ads, up 37% from 1998 (Wall Street Journal, 6/6).
In other tobacco news, Dade County Circuit Judge Robert Kaye dealt tobacco companies a favorable hand when he ruled that jurors would not hear testimony on foreign cigarette sales when considering punitive damages in a Florida class-action lawsuit. Although the ruling applies only to lead defendant Philip Morris, the plaintiffs' attorneys expect that it will eventually apply to the other four companies on trial. The decision means that jurors must consider a smaller pool of money than the plaintiffs -- Florida residents who have died or become ill from smoking-related diseases -- had hoped. Kaye ordered expert plaintiffs' witness George Mundstock, a University of Miami law professor, to recalculate Philip Morris' estimated cash flow and its ability to pay punitive damages, which could amount to billions of dollars. Kaye explained his ruling, saying he was not comfortable letting the jury hear about Philip Morris' overseas sales when only the domestic division is on trial. The tobacco giant reported $10 billion in operating profits from sales in 1999, with $4.9 billion coming from domestic sales (Geyelin, Wall Street Journal, 6/6).