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Campaign Welcomes Aggressive Action by State Attorneys General to Enforce Tobacco Settlement

Statement of Matthew L. Myers, President, Campaign for Tobacco-Free Kids
March 19, 2001

Washington, DC — The CAMPAIGN FOR TOBACCO-FREE KIDS applauds the attorneys general of Arizona, California, New York, Ohio and Washington for filing lawsuits today to stop the R.J. Reynolds Tobacco Company from continuing to violate several marketing restrictions in the November 1998 state tobacco settlement. These lawsuits represent the kind of strong enforcement actions needed to make the settlement agreement an effective tool to help prevent and reduce smoking among kids.

In the 28 months since the settlement was signed, there has been growing evidence that the tobacco industry has systematically violated both the spirit and the intent of the agreement, especially the provision that prohibits the industry from taking 'any action, directly or indirectly, to target youth.' The tobacco companies have claimed that they have changed for the better since the settlement, but the evidence is overwhelming that they have changed for the worse.

Just last week, the Federal Trade Commission released its annual report on cigarette sales and advertising for 1999, the first full year after the settlement, which showed that cigarette manufacturers spent a record $8.24 billion on advertising and promotion, an increase of $1.51 billion or 22.3 percent from 1998. Much of that increase was in categories effective at attracting kids, including shelf displays, two-for-one promotions that reduce cigarette prices, giveaways such as hats and lighters, store advertising and magazine advertising. The FTC report follows two reports released last year that showed significant increases after the settlement in tobacco advertising and marketing in magazines with high youth readership and in retail stores.

Rather than reducing their marketing budgets and strictly complying with the provisions of the settlement, the tobacco companies have increased their marketing expenditures, shifted money to other forms of advertising and promotions effective at reaching kids, exploited loopholes in the settlement and stretched interpretations of its provisions well beyond reason. RJR has been the most brazen and egregious violator, taking the most extreme position on each of the settlement provisions that is the subject of the lawsuits filed today.

While some tobacco companies, when confronted with last year's magazine advertising study, suspended or reduced advertising in magazines with high youth readership, RJR has refused to do so. It has adopted a ridiculously loose interpretation of the settlement's restrictions on outdoor advertising associated with tobacco brand name sponsorships to try to justify advertising its Winston cigarettes year-round at Winston Cup NASCAR racetracks around the country, even when no racing event is even pending at a particular venue. And RJR has shamelessly violated the settlement's ban on tobacco brand name merchandise by allowing the distribution of millions of matchbooks with the Winston brand name and slogans on them.

While today's actions by the state attorneys general represent an important step forward, only continued vigilance and strong enforcement will ensure that the tobacco companies abide by the legal agreement they made to settle the lawsuits filed against them. We must also remember that the state settlement affects only a small part of industry advertising and marketing. To truly protect kids and the public health, effective enforcement of the settlement must be accompanied by congressional action to grant the U.S. Food and Drug Administration broad authority over tobacco manufacturing, marketing and sales.

The tobacco companies have spent the past 28 months claiming that they have changed. Today's enforcement action by the state attorneys general shows once more that they are still targeting and they are still addicting our children. We applaud the leadership shown by Arizona Attorney General Janet Napolitano, California Attorney General Bill Lockyer, New York Attorney General Eliot Spitzer, Ohio Attorney General Betty D. Montgomery and Washington Attorney General Christine O. Gregoire.