Today, Tobacco. Later, Who Knows?

Ad Groups Fret That Court Rule May Set Precedent for Marketers in Other Sectors

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WASHINGTON ( -- As the smoke clears over the most punishing federal-court decision in history against Big Tobacco, ad-industry groups are peering through the haze to determine whether the court-imposed restrictions on product marketing set a dangerous precedent for other industries.

"It presents a risk for other industries that are ... disfavored," said Glenn Lammi, counsel for the Washington Legal Foundation, specifically citing the beleaguered alcoholic-beverage and food sectors.

What's most concerning is the broad latitude of U.S. District Court Judge Gladys Kessler's 1,700-page decision in the case, filed by the Clinton administration against what was originally five tobacco makers: Altria, R.J. Reynolds, Lorillard, Brown & Williamson, and BAT. Ruling that tobacco makers engaged in a racketeering conspiracy and that common industry brand terms wrongly imply a health message, Judge Kessler unilaterally banned the sale of "light" and "ultralight" cigarette brands and ordered hundreds of millions of dollars in corrective advertising.

Altria has already said it will appeal the decision, but should it later be upheld, the far-reaching restrictions could have a chilling effect on the entire marketing industry. Compelling companies to abolish marketing terms such as "light" and retool packaging not only threatens to rewrite tobacco competition but could present a new-and expensive-standard for what's allowed in other industries.

Light and ultralight brands account for a significant portion of the tobacco industry's cigarette volume. While the same product formulations made today can continue under the ruling, the inability to identify brands by their commonly known names could wreak havoc on brand loyalty. Would a loyal Marlboro Light buyer recognize and stick with an identical Marlboro product identified in another way?

Also troubling ad groups is the extent of the judge's order for corrective advertising-the biggest-ever such push, including a year's worth of once-a-week prime-time network-TV spots from each of four companies (see box, P. 3).

ripple effect feared

For advertising lawyers, the fear is that banning product names could open the door to challenges for non-tobacco products. "It's troubling," Mr. Lammi said. "That's what regulatory agencies are tasked to look at, not necessarily something a judge should be doing in the context of a RICO [racketeering] suit."

Another issue is the use of a racketeering statute to attack marketing. "I'm not aware of many RICO cases in the advertising area, and while the use of it is not unprecedented, it's highly unusual to apply it to corrective advertising" said Dan Jaffe, exec VP of the Association of National Advertisers.

Robert Corn-Revere, a Washington media and First Amendment lawyer, said he expects the decision to be cited repeatedly in future pushes for advertising remedies and curbs, but how successfully is far from certain. He said the tobacco case has elements that could limit its applicability to other areas.

What Judge Kessler ordered

* A ban on the use of the terms "low tar," "light," "ultralight," "mild" and "natural" in selling cigarettes, saying they represent health claims

* A year of corrective ads by four companies. Each has to air a 15-second corrective TV ad once a week between 7 p.m. and 10 p.m. on CBS, ABC or NBC.

* Full-page corrective ads in the Sunday editions of more than two dozen major newspapers, with the schedule alternated

* Packaging and in-store signs must carry new corrective advertising.
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