The death last week of the lead judge hearing an appellate court challenge of Food & Drug Administration tobacco ad rules may have a major impact on ad groups' hopes for a quick ruling that would sway congressional consideration of tobacco issues.
Worse still for ad groups, the death of U.S. Circuit Judge Donald S. Russell, 91, on Feb. 22 of lung cancer could significantly alter the balance of the deliberations of what had been a three-judge panel of the U.S. Court of Appeals for the 4th Circuit.
In a lower court ruling in Greensboro, N.C., U.S. District Judge William Osteen found the FDA had no right to regulate advertising, but that the agency could regulate tobacco.
During oral arguments last summer, Judge Russell repeatedly questioned the government's right to regulate tobacco at all or to impose advertising curbs, with the other two members of the panel seemingly split on issues.
Under the appellate court's rules, if the remaining two judges can't agree now, the case will have to be reargued, likely postponing any decision until next year.
"During the questioning, [Judge Russell] had shown a very strong understanding of some of the constitutional issues involved," said Hal Shoup, exec VP of the American Association of Advertising Agencies. "You never know what will happen in chambers, but we were hopeful we would get a decision in our favor so all parties would be acting in a known political and legal environment.
"The possibility of a substantial delay is not helpful," he added.
AD GROUP HOPES
Ad groups had hoped the appellate panel would go beyond Judge Osteen's decision on FDA's authority to regulate tobacco ads and look into the constitutional questions raised by the ad regulations.
Congress now appears ready to give the FDA legal authority to regulate tobacco advertising, but has heard arguments on whether ad restrictions are constitutional. A court ruling might have altered what Congress would accept.
MCCAIN EFFORT STARTING
The importance of a quick court decision became apparent last week when Senate Commerce Committee Chairman John McCain (R., Ariz.) announced his committee would begin "marking up" tobacco legislation March 12, with the hope of drafting a package that could later be presented to the Senate.
It may be at those first mark-up hearings that the fate of tobacco ad regulation is decided.
The CEOs of the leading tobacco marketers all appeared before Sen. McCain's committee last week. While they all pledged never again to use cartoon characters in advertising, they also said they would not voluntarily accept ad restrictions without a limit on corporate liability in return.
RJR Nabisco Holdings Corp. President-CEO Steve Goldstone said accepting the ad restrictions without liability protection risked driving the company into bankruptcy.
While tobacco executives last week urged Congress to rely on their original $368.5 billion deal with attorneys general rather than seek the higher amounts proposed by a group of Democratic senators, a second group of Democratic senators proposed funding a worldwide anti-smoking advertising campaign.
2 CENTS-PER-PACK TAX
Sen. Richard J. Durbin (D., Ill.) joined several colleagues in sponsoring legislation that would add a proposal to the legislative package for a 2 cents-per-pack tax to fund an ad and educational campaign to be administered by an independent group.
Copyright February 1998, Crain Communications Inc.