Wednesday, March 25, 2009

“Light” Cigarettes Class Action to Advance Despite Preemption, Exemption Claims

This posting was written by Jody Coultas, Editor of CCH State Unfair Trade Practices Law.

Philip Morris Co. failed to prove that a class action claiming that the marketing of “light” cigarettes violated the Massachusetts Consumers Protection Act (CPA) was barred by the statute’s exemption for actions permitted by a regulatory board or officer, the Massachusetts Supreme Judicial Court has ruled.

A group of Marlboro Light cigarette consumers brought a class action under the CPA against cigarette manufacturer Philip Morris, asserting that Philip Morris engaged in an unfair or deceptive act by using the descriptors “light” and “lower tar and nicotine” on its packaging.

Preemption; Statutory Exemption

Philip Morris’s motion for summary judgment asserted that the class action was (1) preempted by the Federal Cigarette Labeling and Advertising Act (FCLAA) because the claims fell under the provision that forbids states from requiring additional health warnings on cigarette packaging and (2) barred by the exemption contained in the CPA because the Federal Trade Commission gave Philip Morris permission to use the descriptors in question.

In light of the Supreme Court ruling in Altria Group, Inc. v. Good (CCH Advertising Law Guide ¶63,232 and CCH State Unfair Trade Practices Law ¶31,749), the court denied Philip Morris’s preemption argument. The Supreme Court in Good held that the FCLAA did not preempt claims based on “light” descriptors brought under state consumer protection laws.

Furthermore, the class action was not barred by the exemption provision of the CPA, according to the court. The exemption provision states that the CPA is not applicable to “transactions or actions otherwise permitted … by any regulatory board or officer acting under statutory authority of the commonwealth or of the United States.”

In this case, Philip Morris argued that the FTC permitted the use of the “light” descriptors on the packaging for Marlboro Lights. The court concluded, however, that Philip Morris did not present any evidence that the FTC affirmatively permitted the practice in question because it did not point to any affirmative action by the FTC that affirmatively permitted the use of the descriptors.

Because Philip Morris did not meet the heavy burden of supporting the motion for summary judgment, the class action was allowed to proceed.

The March 16 decision in Aspinall v. Philip Morris, Inc., will appear in both CCH Advertising Law Guide , CCH State Unfair Trade Practices, and CCH Trade Regulation Reporter.

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