Proposed Cigarette Restrictions Under Fire
CHICAGO -- The U.S. government plans to seek a broad range of restrictions on how tobacco companies market cigarettes in a three-year-old lawsuit against the industry, but analysts are skeptical over whether the government can win any of the limitations in court.
In a legal filing made late last year, the Justice Department said it would seek to force cigarette companies to package their products only in black and white, put graphic health warnings on at least 50 percent of the space of all tobacco advertising and eliminate sales of cigarettes in vending machines, Reuters reported.
The government will also seek to prevent or limit the use of lucrative "slotting fees" that companies pay to merchants to secure prominent shelf space, as well as promotions like clothing giveaways and buy-three, get-two sales.
Those are part of a long list of remedies the government said it would seek in December in an exchange of documents in the lawsuit against several tobacco companies. "The government can throw out whatever it wants in its [requests]. It doesn't get anything unless it wins," said David Adelman, a tobacco industry analyst at Morgan Stanley.
Defendants include industry leader Philip Morris Cos. Inc, R.J. Reynolds Tobacco Holding Co., Brown & Williamson Tobacco Corp., Lorillard Tobacco Co. Inc., Liggett Group Inc., the Council for Tobacco Research U.S.A. Inc. and the Tobacco Institute Inc.
Industry lawyers argue that some of the proposed remedies, which go beyond those reached in a legal settlement with 46 states, are unconstitutional. "A substantial majority of what they requested, a judge can't order and neither could Congress, in many respects, enact into law," William Ohlmeyer, vice president and associate general counsel for Philip Morris, told Reuters.
In a legal filing made late last year, the Justice Department said it would seek to force cigarette companies to package their products only in black and white, put graphic health warnings on at least 50 percent of the space of all tobacco advertising and eliminate sales of cigarettes in vending machines, Reuters reported.
The government will also seek to prevent or limit the use of lucrative "slotting fees" that companies pay to merchants to secure prominent shelf space, as well as promotions like clothing giveaways and buy-three, get-two sales.
Those are part of a long list of remedies the government said it would seek in December in an exchange of documents in the lawsuit against several tobacco companies. "The government can throw out whatever it wants in its [requests]. It doesn't get anything unless it wins," said David Adelman, a tobacco industry analyst at Morgan Stanley.
Defendants include industry leader Philip Morris Cos. Inc, R.J. Reynolds Tobacco Holding Co., Brown & Williamson Tobacco Corp., Lorillard Tobacco Co. Inc., Liggett Group Inc., the Council for Tobacco Research U.S.A. Inc. and the Tobacco Institute Inc.
Industry lawyers argue that some of the proposed remedies, which go beyond those reached in a legal settlement with 46 states, are unconstitutional. "A substantial majority of what they requested, a judge can't order and neither could Congress, in many respects, enact into law," William Ohlmeyer, vice president and associate general counsel for Philip Morris, told Reuters.