2nd UPDATE: Tobacco Companies Sue FDA Over New Restrictions
August 31 2009 - 6:27PM
Dow Jones News
Tobacco companies including Reynolds American Inc. (RAI) and
Lorillard Inc. (LO) filed a lawsuit against the U.S. and the Food
and Drug Administration, saying that a recent law imposes
"unprecedented restrictions" on First Amendment rights.
The FDA received authority in June from lawmakers to regulate
the tobacco industry after years of contentious debate in Congress,
the public health arena and among tobacco firms. The June
legislation allowed for restrictions on advertising and
packaging.
Under the new legislation, tobacco companies can't jointly
market their cigarettes with non-tobacco products sold at local
retailers. Also, they cannot market or describe any products as
less harmful than others unless they have approval to do so from
the FDA. There had been no specific legislation previously that
laid out exactly how tobacco companies could describe the relative
risk from different types of tobacco products.
Tobacco companies have worked to develop smokeless products,
which some research indicates maybe less harmful than cigarettes.
It is still unclear how the FDA will decide to treat these
products.
Reynolds says it isn't against the decision to give FDA
authority to regulate tobacco, but it is protesting several
provisions in the recent legislation. A spokesman said that, among
other provisions, the company is opposing those that prevent it
from describing certain tobacco products as less harmful even if
there is supporting scientific information. Any such claims would
first have to be cleared by the FDA and it is still unclear what
process the FDA's new tobacco center will use, he said.
Altria (MO), the nation's largest cigarette maker, wasn't part
of the lawsuit. Altria, which makes the well-known Marlboro brand,
has generally been seen as being hurt less than its smaller
competitors by marketing and other restrictions because it already
has a large, dominant market share. An Altria spokesman declined
comment.
"This suit does not challenge Congress' decision to give the FDA
regulatory authority over tobacco products, nor does it challenge
the vast majority of the provisions of the new law," said Martin L.
Holton III, senior vice president and general counsel for R.J.
Reynolds. "However, the law contains provisions that severely
restrict the few remaining channels we have to communicate with
adult tobacco consumers and, in our opinion, cannot be justified on
any basis consistent with the demands of the First Amendment."
Cigarette makers have seen sales shrink in the past decade, and
they have already been operating under some restrictions that were
part of their 1999 settlement with 46 states.
The new law, though, was backed by Altria Group, parent of
industry leader Philip Morris. Critics of the bill said it would
protect the company's No. 1 status.
R.J. Reynolds said Monday the plaintiffs are seeking to protect
their First Amendment right to communicate with "adult tobacco
consumers about their products." The plaintiffs allege the law
contains "severe provisions restricting or banning truthful speech,
contrary to the requirements of the First Amendment."
The suit was filed in federal court in Kentucky. A
representative from the FDA declined to comment.
-By John Kell, Dow Jones Newswires; 212-416-2480;
john.kell@dowjones.com; and Anjali Cordeiro; 212-416-2200;
anjali.cordeiro@dowjones.com
(Jared Favole contributed to this article.)