April 30, 2012

Hit by federal regulations and massive class action lawsuits, two of Canada’s tobacco companies have struck back with legal action of their own.

Imperial Tobacco Canada Ltd. and JTI-Macdonald Corp. have launched proceedings in Ontario Superior Court to attempt to strike down cigarette package warning regulations that came into effect last fall.

The new regulations require 75 per cent of packages to be filled with health warnings, up from the previous level of 50 per cent.

In separate lawsuits filed in Ontario Superior Court, the companies claim the restriction infringes on their right to freedom of expression under the Charter of Rights and Freedoms.

The new legal front opens as the companies face down a $27-billion class action lawsuit in Quebec Superior court brought on behalf of cigarette addicts and patients who have suffered tobacco-related illnesses. Dozens of lawyers are fighting it out in a trial expected to last well into 2013.

In the Quebec class action, the tobacco companies have maintained it was up to the federal government to warn smokers since research about smoking-related illness and death started to emerge in the 1960s.

“Now that the government has required improved warnings, the industry is trying to strike them down,” said Rob Cunningham, a senior policy analyst at the Canadian Cancer Society.

In a press release John Clayton, Imperial’s vice-president of corporate affairs, accused the federal government of “avoiding the country’s number one tobacco problem, the illegal tobacco market (that) avoids all taxes and current regulations.”

The statement skirted the main legal challenge for the company posed by a 2007 Supreme Court of Canada decision that found the 50 per cent cigarette label rule was a reasonable restriction on freedom of expression given Parliament’s aim to reduce smoking.

“They opposed 20 per cent, they opposed 50 per cent. It’s a highly objectionable legal strategy,” Mr. Cunningham said.

Imperial, the biggest of the two companies which filed its suit Wednesday, declined interview requests. JTI-Macdonald filed its suit without announcing it early this month.

Canada was the first country to require 50 per cent warnings in 2001 but the new regulations only bring the country back to the lead pack for tough packaging regulations, according to Mr. Cunningham.

Australia goes further requiring even larger warnings and bland generic company labelling.

Source: Globe & Mail (April 26, 2012)

April 27, 2012

Tobacco companies are designing cigarette packs to resemble bottles of perfume or with lids that flip open like a lighter to lure young people into smoking.

Research published yesterday reveals the lengths to which the industry has gone to make its packs attractive to new generations of smokers as opportunities for promoting its products have been progressively reduced.

Responding to last week’s launch of a public consultation on tobacco packaging by the Department of Health, Cancer Research UK said the findings provided “a chilling insight” into the power of branding and marketing by the tobacco industry.

The research shows children aged from six to 11 are drawn to the slickly presented packs, responding with remarks such as, “It makes you feel you’re in a wonderland of happiness”, “It reminds me of a Ferrari” and “Yeah, pink, pink, pink.” Jean King, director of tobacco control for the charity, said: “Children are drawn to the colourful and slick designs without having a full understanding of how deadly the product is inside the pack. It is time to end the packet racket.”

The range of designs has proliferated over the last decade, since print and billboard advertising of tobacco was banned 10 years ago. Long, slender cigarettes contained in pastel coloured packs indicating femininity, style and sophistication are targeted at young women. Packs of 14 cigarettes are designed to look like packs of 20 but sell at a lower price.

Tobacco companies have admitted that packaging is key to promoting their products. An internal memo from Philip Morris obtained by researchers read: “When you don’t have anything else packaging is our marketing.”

Cancer Research UK yesterday launched an appeal for signatures to its petition calling for the removal of all branding from tobacco packaging.

Eight focus groups of 15-years-olds assembled by the charity showed clear differences between boys and girls when asked to pick their favourite pack. Girls chose Silk Cut and Vogue Superslims which they related to perfume, make-up and chocolate. Boys preferred Marlbro Bright Leaf, Lambert and Butler and B&H slide packs which suggested maturity, popularity and confidence.

The charity has designed a standardised pack, coloured olive brown, carrying government health warnings and a covert marking as protection against counterfeiters. Teenagers shown the pack described it as “boring and smelly.” One said: “God, are my lungs this colour as well?”

Professor Robert West, director of tobacco research at University College London, said lighter coloured packs were perceived as healthier and the presence of branding reduced the impact of health warnings. He said: “Tobacco companies claim they don’t market their products to children. But the truth is their products are attractive to children. This is about protecting children.”

Around 20 per cent of adults in the UK smoke and each percentage point reduction could prevent 3,000 deaths, he said. Australia is to introduce plain packs from December but is facing a legal challenge from the industry. France, Turkey, Hong Kong and Brunei are reviewing their policy and New Zealand has said it favours plain packs in principle.

Jaine Chisholm Caunt, secretary-general of the Tobacco Manufacturers’ Association, said: “There is no reliable evidence that plain packaging will reduce rates of youth smoking.”

Source: The Independent (April 26, 2012)

April 26, 2012

The government of Australia, which wants to impose the world’s first-ever ban on logos printed on cigarette packaging, has a unique marketing challenge: How to create a product package whose intent is to repel consumers.

A proposed Australian law, being watched by governments globally and challenged by companies including British American Tobacco Plc, would require cigarettes to be sold in dark olive- brown packages, with corporate logos replaced by graphic images of diseases blamed on smoking, and a uniform font previously associated with Microsoft Corp.’s (MSFT) (MSFT) Windows software. The choice of color and font was based on studies by Australian health authorities, who sought to minimize the packs’ attractiveness.

That research dovetails with decades of polling and experimentation by companies such as BAT (BATS) and Imperial Tobacco Group (IMT), who have long viewed their packages as “silent salesmen.” The Australians took all that knowledge and turned it on its head in a fit of anti-marketing. Logos on tobacco packaging are slated to be banned in the country from December, dealing a body blow to the $661 billion global industry.

“Making choices to dissuade, or prohibit the packages from standing out or drawing attention, is not the norm, but the design process is really the same,” Jeff Bellantoni, chair of the package design program at the Pratt Institute’s School of Art & Design in New York, said in an interview.
International Interest

New Zealand, Canada, Belgium, Iceland and France have all shown an interest in implementing a plain-packaging law like Australia, which accounts for 0.3 percent of global tobacco volumes, according to Euromonitor International research. The U.K. government this month called for reactions to standardize tobacco packaging, which tobacco companies claim would illegally seize their trademarks and increase sales of illicit smokes.

If Australia’s High Court upholds the law, brands such as Dunhill, made by British American, and Philip Morris International Inc.’s (PM) (PM) Marlboro would lose their iconic logos and recognizable imagery overnight. All that would remain is the brand name, written in a font known as Lucida Sans, on a pack whose color is known in the design trade as Pantone 448C.

Neither choice was random. The Australian health department hired Sydney-based research company GfK Blue Moon to come up with the most repellent packaging possible. GfK selected both the color and font to “unplug the product” from its marketing, creating a gap between the tobacco in the pack and its association with anything elegant, masculine, or exciting, according to Scott Morris, associate professor of food engineering and packaging at the University of Illinois.

Legible Font

Known mostly for being legible, Lucida was designed by the Bigelow & Holmes studio in 1985. Designers Charles Bigelow and Kris Holmes wanted to create a font that transmitted well onto laser printers. The Lucida family includes a sans-serif version, without small lines at the end of the characters. Microsoft has licensed it for use on its Windows systems.

“Lucida Sans is one of the least graceful sans-serif typefaces designed,” Tom Delaney, a senior designer with New York design and identity consultant Muts & Joy, said in an e- mail. “It’s clumsy in its line construction.”

Pantone 448C, meanwhile, isn’t a color found on most product packages, for good reason. Australia commissioned GfK to find a color that was “the least appealing” and contained cigarettes that were lowest quality, according to GfK’s 2011 report.

To aid its search, GfK could consult studies done by tobacco companies, who have come to rely on packaging more as traditional avenues of advertising, such as television and print, have been shut by regulators.

Social Visibility

Cigarette packages are different from other consumer product containers, in that smokers retain the pack until it’s finished, and frequently display it in public. Such social visibility means cigarettes are known as “badge products,” which associate the user with the brand’s image.

Most importantly, perceptions of cigarettes can be changed by altering the color or shade of color on a pack, through a process called “sensation transfer.” Lightening the tone is a common practice, as it reduces the perception of a cigarette’s strength. Red conveys a strong smoke, blue is associated with lower-tar, and white is usually the lightest smoke available.

“Consumers use things like color as an indication of risk,” said David Hammond, an associate professor at the University of Waterloo’s School of Public Health who has studied tobacco packaging. “It’s effective with tobacco as smokers are motivated to believe their brand is less harmful.”

Red or Blue?

Philip Morris, now called Altria Group Inc. (MO) (MO) in the U.S., once compared smokers’ responses to identical cigarettes packaged in separate blue and red packs. Some smokers found the cigarettes in the blue pack to be too mild, while others felt those in the red pack were too harsh.

GfK recommended eight colors for testing on smokers. Dark colors were perceived as more harmful, and dark brown was the least appealing, carrying connotations of uncleanliness. A lighter-brown color was rejected as it could be perceived by consumers as gold. An olive tint prevents the brown from looking like chocolate, which also has positive associations.

“Pantone 448C is discouragingly drab, both literally and figuratively,” Morris, the packaging professor, said in an e- mail. “You can see that there isn’t much left that connects the brand with any advertising, and it’s certainly unappealing.”

Yet by using Lucida Sans, a common font available to anyone, Australia may have provided tobacco makers with a window of opportunity, according to Jason Smith, founder of Fontsmith, a London-based font design company that has worked with companies such as Xerox Corp. (XRX) (XRX) and the British Broadcasting Corp.

“They probably should have gone for something less familiar,” Smith said in an interview. “There is absolutely nothing to stop the cigarette companies from taking Lucida Sans and using it on the side of a Formula One car, in their own brand colors.”

Source: Bloomberg (April 22, 2012)

April 23, 2012

Indonesian tobacco companies will be forced to place photos of horrific health problems caused by smoking on every pack and advertisers will be banned from showing cigarettes under a planned government regulation.

The Health Ministry provided a photo of an Indonesian-made cigarette packets, sold abroad, featuring pictures of rotting teeth and diseased limbs, as an example.

Under the regulation, photographic health warnings will cover 40 percent of a cigarette pack, along with written warnings.

Coordinating People’s Welfare Minister Agung Laksono said Thursday that the government regulation (PP) on tobacco control would also mandate the designation of smoke-free zones.

“Unlike the existing regulation, the planned regulation will order cigarette makers to put not only written but also pictorial messages on the dangers of smoking on cigarette packages,” he said at a press briefing following a meeting on tobacco control at the Health Ministry.

Indonesia ranks third in the number of deaths due to smoking-related diseases globally, trailing China and India. People from all walks of Indonesian life are smoking, despite health warnings on cigarette packs.

Health Ministry data showed that it spent 2.11 trillion rupiah (US$229.99 million) on tobacco-related illnesses in 2010, with 1.85 trillion rupiah ($201 million) spent on in-patient services and 260 million rupiah ($23,000) for out-patient services.

The regulation would be an implementation of Law No. 36/2009 on health, which mandates a regulation controlling the distribution of addictive substances like tobacco.

But Agung said that smokers would still be allowed to light up.

“Each public facility may set up a smoking section that has direct connection to open air,” he said.

The Constitutional Court (MK) this week issued a ruling requiring the establishment of smoking rooms in every public building.

Article 115 Law No. 36/2009 on health stipulates that the local government must be responsible for the designation and monitoring of smoke-free zones in healthcare facilities, schools and educational centers, playgrounds, places of worship, public transportation and offices.

“Under the planned regulation, local administrations will have the authority to designate smoke-free zones,” Agung said. The regulation will also be more stringent on cigarette advertising, including a ban on displaying images of cigarettes, and the size of billboards and outdoor banners limited to less than 72-square meters.

“We don’t prohibit them to advertise their products but only encourage them to do it in a more responsible manner,” Agung said.

Separately, the Health Ministry’s legal bureau head, Budi Sampurna, said that in an early draft, it was proposed that outdoor advertisements be no larger than 16 square meters. The Indonesian Outdoor Advertisement Association proposed 6 by 12 meters instead.

“We decided that it should not exceed 72 square meters,” Budi said.

Deputy Health Minister Ali Ghufron Mukti said tobacco advertising near schools will be also outlawed.

“Education plays an important role in protecting young people against the bad habit of smoking,” he said, adding the number of young smokers continued to increase, making them more prone to disease.

The 2010 Basic Health Survey (Riskesdas) found that 17.5 percent of smokers were aged 10-14 years, up from 9.5 percent in 2001.

Source: The Jakarta Post (April 20, 2012)

April 20, 2012

The tobacco industry’s constitutional challenge to enforced plain packaging has hit a central problem: smoking kills.

After six hours of legal argument by the tobacco multinationals in the High Court yesterday, the Chief Justice, Robert French, raised the question of whether previous cases cited by legal counsel to support the companies’ case dealt with a product comparable to cigarettes.

Justice French put it to leading counsel Bret Walker, SC, who had referred to cases dating back to the 1870s in the United States, that none related to a product on the market that carried the risk of serious or fatal disease to all who used it.

”Doesn’t this put it into a different category?” Justice French asked.

Mr Walker said there was no case dealing with public health in the context of this constitutional challenge that he could produce.

He is appearing for two of the five tobacco companies challenging the constitutional right of the federal government to introduce plain packaging at the end of this year. This measure would require the removal of all trademarks and logos from cigarette packets which would have to be coloured a uniform brown and carry prominent health warnings and images.

The companies, British American Tobacco, Philip Morris, Imperial Tobacco, Van Nelle Tabak Nederland and JT International SA, have argued the measure breaches the constitutional requirement that the acquisition of property by the government be on just terms.

To make the case that the government’s measures involve an acquisition, the companies have to show that the government gains a measurable benefit as a consequence, that is apart from the claimed benefits to the public’s health.

The Commonwealth Solicitor-General, Stephen Gageler, SC, later yesterday opened the defence case declaring there could be no acquisition of property unless it could be shown that property had been taken.

Mr Gageler said it would be “incongruous” for the government to compensate a company for requiring a measure that had as its purpose the prevention of harm to the public.

He took up the example of Ratsak rat poison, previously raised in the hearing, as a product where the company was required to print a warning on the pack to keep it away from children.

To liken it to the aim of the plain packaging measures, Mr Gageler said it would be inconceivable for rat poison companies to be paid compensation if they were prohibited from making the product package appealing to children.

The steady increase in regulation of tobacco over the past 30 years might prompt the view that the companies were to be likened to ”frogs slowly boiling”, gradually having their property taken away, he said.

But Mr Gageler said that the increasing restrictions on the tobacco companies and the use of their trademark had not been associated with any diminution of their property.

Source: The Sydney Morning Herald (April 19, 2012)

April 20, 2012

The New Zealand cabinet has agreed in principle to introduce plain packaging for all tobacco products in New Zealand, following a similar move in Australia.

The packaging will display only health warnings and the contact details for Quitline – the government-funded service helping smokers stub out, Associate Health Minister Tariana Turia says.

“Smoking is the single biggest cause of preventable death and disease in New Zealand and we must be prepared to take bold steps towards achieving our goal,” Mrs Turia said on Thursday.

“We have banned the open display of cigarette and tobacco packs in all dairies and other shops with effect from July 23 this year. Plain packaging is the next step to ensure that once they are in the hands and homes of smokers, the packs don’t promote anything other than our serious health warnings and quit messages.”

There will be a public consultation process on the proposed change, she added.

In December Australia will become the first country in the world to enforce plain packaging of tobacco products.

Lawyers for British American Tobacco, Japan Tobacco International, Philp Morris and Imperial Tobacco Australia told the High Court in Australia this week that plain packaging would extinguish their brands and logos.

Source: The Sydney Morning Herald (April 19, 2012)

April 18, 2012

In Denmark, picture warnings are now appearing on store shelves for packages of cigarettes.  There was an implementation date of Feb. 15, 2012 for cigarettes, with an implementation date of Aug. 15, 2012 for various other tobacco products such as roll-your-own tobacco.

Denmark is one of 10 European Union countries to have finalized requirements for picture warnings, along with Belgium, France, Hungary, Ireland, Latvia, Malta, Romania, Spain, and the United Kingdom.

Denmark’s picture-based tobacco packaging and labelling requirements were initially outlined in to Order No. 172 of Feb. 28, 2011.

https://www.retsinformation.dk/Forms/R0710.aspx?id=135884

This Order was amended by Order 437 of May 2, 2011, which replaced the Annex illustrating the 14 picture-based messages to appear with a new Annex.  To see the set of 14 picture-based warnings appearing now in Denmark, it is the new Annex that should be examined, which can be seen here:

https://www.retsinformation.dk/Forms/R0710.aspx?id=137083

There are at least 49 countries/territories that have finalized requirements for picture warnings.

Source: Rob Cunningham (April 11, 2012)

April 16, 2012

The government is considering plans to strip all branding from cigarette packs sold in England in a bid to make smoking appear less attractive.

Health Secretary Andrew Lansley told the Times the government did not work with tobacco companies as it wanted them to have “no business” in the UK.

He said 5% of 11 to 15-year-olds were regular smokers and the habit led to nearly 100,000 deaths in the UK yearly.

The government is to launch its consultation on the issue on Monday.

Vending machine ban

In a statement, Mr Lansley said: “Smoking remains one of the most significant challenges to public health.

“Each year it accounts for over 100,000 deaths in the UK and one in two long-term smokers will die prematurely from a smoking disease.

“That is why the health ministers across the UK have a responsibility to look closely at initiatives that might encourage smokers to quit and stop young people taking up smoking in the first place.

“Through the forthcoming consultation we want to hear as many views as possible about whether tobacco packing should remain unchanged, plain packaging should be adopted or a different option should be considered.”

A ban on tobacco displays in large shops started earlier this month, and smaller shops will have to follow suit by 2015.

The move comes after bans on vending machine sales, increasing the age at which a person can legally buy cigarettes and the ban on smoking in public places.

‘Attractive’ packaging

Australia is currently the only country which has so far agreed to plain packaging.

Its ban starts at the end of this year, although it is subject to a legal challenge by manufacturers.

Packets will be a dark olive green, after the public was asked what the least attractive colour was.

Research published in Australia has suggested that cigarette packets have increasingly become an important marketing tool as restrictions on advertising and sponsorship have been brought in.

Mr Lansley told the Times he was open-minded, but that he believed attractive packaging helped recruit smokers from a young age.

More than 300,000 children aged under 16 in England try smoking each year, according to government figures.

The consultation will also examine if plain packaging could lead to a rise in cigarette packets being sold on the black market.

Mr Lansley said the tobacco companies used certain colours to trigger memories and their brands constituted a type of advertising.

“We don’t want to work in partnership with the tobacco companies because we are trying to arrive at a point where they have no business in this country,” he added.

Counterfeiting ‘risk’

The consultation document is expected to suggest that branded tobacco packets create “smoker identity”, with certain brands seen as “cool” and “popular”, the paper reported.

It is also expected to say that tobacco firms use colours and logos to boost their profits.

The Tobacco Manufacturers’ Association said it “welcomed” the consultation.

But Jane Chisholm-Caunt, secretary-general of the TMA, said: “There is no reliable evidence plain packaging will reduce rates of youth smoking.

“Smoking initiation in children is actually linked to a complex range of socio-economic factors including home life, peer pressure and truancy and exclusion from school.”

And she warned plain packaging would only serve to make counterfeiting cigarettes easier.

Simon Clark, director of the smokers’ group Forest which runs the “Hands Off Our Packs” campaign, added: “The consultation on plain packaging threatens to be a farce.

“Andrew Lansley says he is open minded yet he clearly supports plain packaging even before the consultation has begun.”

Smoking rates have fallen significantly since the link with cancer was established beyond doubt in the 1950s.

But it recent years the decline has slowed with the number of adult smokers hovering above the 21% for some time.

Ministers have promised to reduce this to 18.5% by 2015.

Source: BBC News (April 13, 2012)

For more information, and to access the consultation on tobacco packaging, please visit the Department of Health website: http://consultations.dh.gov.uk/tobacco/standardised-packaging-of-tobacco-products/consult_view

April 13, 2012

Ecuador has finalized requirements for a series of 6 picture-based warnings to appear on the bottom 60% of the front and back packages of cigarettes effective July 15, 2012.  The government announcement regarding the content of picture warnings was made March 9, 2012.

Also, a single qualitative toxic emission information will be required to appear on 70% of one side panel.  Misleading descriptors including light and mild have been prohibited.

To view additional information on the warning images and legislation, visit:

http://tobaccolabels.ca/healthwarningimages/country/ecuador

The Spanish versions of the Law, the Regulation and the Application Manual can be seen in pdf format at the following website (the Application Manual illustrates the six picture warnings to be required, the toxic emission message, and how these are to be depicted for different package sizes).

http://www.cilaecuador.gob.ec/index.php?option=com_content&a…

To view a separate pdf document illustrating the six picture warnings to be required, visit:

http://www.cilaecuador.gob.ec/index.php?option=com_content&a…

To view English translations (and Spanish originals) of the Organic Law for the Regulation and Control of Tobacco (singed by the President on July 13, 2011, and published in the official gazette on July 22, 2011), and to view  the Regulation to the Regulation and Control of Tobacco Act No. 1042 (adopted under the Organic Law and signed by the President on Feb. 10, 201), visit:

http://www.tobaccocontrollaws.org/legislation/country/ecuado…

There are at least 49 countries/territories that have finalized requirements for picture warnings.

Source: Rob Cunningham

April 13, 2012

The U.S. government on Tuesday defended graphic tobacco labels and advertising that use pictures of rotting teeth and diseased lungs as accurate and necessary to warn consumers about the risks of smoking.

The U.S. Food and Drug Administration on Tuesday asked a U.S. appeals court to undo a lower court ruling that said such labels were unconstitutional, violating tobacco companies’ free-speech rights.

Mark Stern, a lawyer from the U.S. Justice Department representing the FDA, said the labels showing, for example, a man smoking through a hole in his throat were necessary to show the true risks of smoking, including addiction.

“Adolescents notoriously underestimate their ability to resist addiction,” he told the U.S. Court of Appeals for the District of Columbia Circuit.

“Do (these labels) accurately and realistically depict the message that this is really addictive? Yes, (they) do.”

The Centers for Disease Control and Prevention estimates some 45 million U .S. adults smoke cigarettes, which are the leading cause of preventable deaths in the United States.

Congress passed a law in 2009 that gave the FDA broad powers to regulate the tobacco industry, including imposing the label regulation. The law requires color warning labels big enough to cover the top 50 percent of a cigarette pack’s front and back panels, and the top 20 percent of print advertisements.

The FDA released nine new warnings in June 2011 to go into effect in September 2012, the first change in U.S. cigarette warning labels in 25 years. Cigarette packs already carry text warnings from the U.S. Surgeon General.

Reynolds American Inc’s R.J. Reynolds unit, Lorillard Inc, Liggett Group LLC, Commonwealth Brands Inc, which is owned by Britain’s Imperial Tobacco Group Plc , and Santa Fe Natural Tobacco Co Inc challenged the rule, arguing it would force them to engage in anti-smoking advocacy against their own legal products.

“You don’t have to be Sherlock Holmes … to figure out what the government is doing here: telling people, ‘Quit smoking now,'” said Noel Francisco, a lawyer with Jones Day in Washington, D.C., who represents the tobacco companies.

He said the labels went beyond simple facts about smoking, instead trying to disgust or revolt people about cigarettes.

U.S. District Judge Richard Leon sided with the tobacco companies in a February ruling, saying the warning labels were too big and the government could use other tools to deter smoking, such as raising taxes or using factual information on the labels rather than gruesome images.

One of three appeals court judges who heard the case on Tuesday also appeared to question whether the government was going too far in trying to warn people about smoking.

“Could you have a text that says, ‘Stop, if you buy this, you are a moron’?” asked Judge Janice Rogers Brown.

And Judge A. Raymond Randolph wondered if the government could also place warning labels on automobile doors with gruesome images of car accidents to warn people about the risks of speeding.

However, Randolph disagreed with the tobacco companies, saying there is no case that shows commercial disclosure should only provide information, not deter use of a product.

The judges will rule on the case later, but any decision is likely to be appealed further and could eventually reach the U.S. Supreme Court, especially as the tobacco law has led to divergent rulings in lower courts.

The U.S. Appeals Court for the 6th Circuit, based in Cincinnati, upheld the bulk of the FDA’s new tobacco regulations last month, including the requirement for warning images on cigarette packs.

The case on Tuesday was R.J. Reynolds Tobacco Company et al v. FDA, U.S. Court of Appeals for the District of Columbia Circuit, No. 11-5332.

Source: Reuters (April 11, 2012)