Editorial -- A Go-Ahead for a Lawsuit Accusing Philip Morris USA of Deception

Tuesday, December 16, 2008

A smoke-and-mirrors legal approach failed the tobacco companies yesterday in their latest attempt to shield themselves from private lawsuits.

Altria Group, parent company of cigarette maker Philip Morris USA, had asked the Supreme Court to halt a Maine lawsuit claiming that the company used deceptive advertising when marketing its "light" cigarettes. The lawsuit was brought under a Maine consumer protection law that declared unlawful any "unfair or deceptive acts or practices in the conduct of any trade or commerce." The suit alleged that Philip Morris has long known that smokers of cigarettes marketed as "light" or containing "low tar and nicotine" often inhaled as much tar and nicotine as smokers of "full-flavored" brands.

Altria argued that the lawsuit was barred by the Federal Cigarette Labeling and Advertising Act, which was passed in the 1960s to alert consumers to the dangers of smoking through the now-ubiquitous surgeon general's warnings. The act gave exclusive authority to the federal government to regulate the language in the warnings and prohibited "diverse, nonuniform, and confusing cigarette labeling and advertising regulations with respect to any relationship between smoking and health." Altria tried to argue that this language prohibited the state suit because the plaintiffs were advancing a claim that was based on "smoking and health," which were the province of the federal statute.

Both the Federal Trade Commission and a 5 to 4 majority of the justices rightly rejected that argument and ruled that the suit may go forward. The court concluded that the plaintiffs legitimately relied on state law to challenge an allegedly deceptive practice not covered under the Labeling Act or any of its exemptions. Justice John Paul Stevens, writing for the majority, left it to a trial court to determine whether the plaintiffs' claims have merit.

It often makes sense to avoid a hodgepodge of state and local rules governing big business in favor of uniform federal strictures. In those cases, the federal government should have exclusive jurisdiction in crafting and regulating the rules. But the tobacco companies in this case tried to stretch the federal Labeling Act to cover much more than Congress intended. They did so in an attempt to shield companies from lawsuits that even the FTC endorsed as a legitimate vehicle for the protection of consumers. The FTC and five justices came to the conclusion that tobacco companies can and should be held accountable if they deceptively advertised their products. The tobacco companies would be smart to finally come to grips with that.

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