Thursday, December 02, 2010

Attorneys General Ask R.J. Reynolds to Cease Camel Promotion, Calling it a Violation of Master Settlement Agreement: A Story of Sour Grapes

In a letter sent last week to the R.J. Reynolds Tobacco Company, the National Association of Attorneys General (NAAG) has asked the company to discontinue its recent Camel advertising campaign, which uses the themes and cultures of prominent U.S. cities to market the brand (the promotion is called the Break Free Adventure campaign).

The basis for this request is NAAG's assertion that the campaign violates the Master Settlement Agreement's (MSA) prohibition of the targeting of youth in cigarette advertising. NAAG argues that the campaign appeals to youth because of its themes of rebelliousness, sensation-seeking, and risk-taking, and therefore, it represents targeting of youth that is prohibited by the MSA.

According to the letter: "We are concerned that this advertising campaign is using aspects of popular culture, including independent music, art, motor sports, and “hip” or countercultural attitudes, to advertise Camel cigarettes in a way that is appealing to young people’s psychological needs for rebelliousness, sensation-seeking, and risk-taking. ... It is important for Reynolds to realize ... that although the promotion may be of interest to adult smokers, it may also have substantial appeal to youth and may encourage the initiation of tobacco use in minors. ... We think it is critical that Reynolds address the problem created by these advertising promotions that resonate with youth and that endanger lives by increasing the risk that children will start smoking."

According to an Associated Press article, R.J. Reynolds "does not believe that the direct-marketing promotion violates its obligation under the 1998 tobacco settlement."

The Rest of the Story

Unfortunately, R.J. Reynolds is entirely correct. This promotion does not violate the company's obligation under the 1998 Master Settlement Agreement.

Why? Because the Attorneys General who negotiated that agreement were motivated by political and economic gain rather than a genuine concern for the public's health, and as a result, they agreed to a deal that brought lots of money into the states, but did nothing to actually reduce youth smoking.

For example, the Attorneys General decided to allow exactly the kind of advertising campaign that R.J. Reynolds is now running. The MSA only prohibits the "targeting" of youth in cigarette advertising. It does not prohibit advertising that reaches youth, nor does it prohibit advertising that appeals to youth. The only prohibition is against advertising that reaches youth and/or appeals to youth in equal or greater magnitude than adults.

I actually testified as an expert witness against R.J. Reynolds in the California lawsuit to which NAAG refers in its letter. In that lawsuit, a California Superior Court (and the appellate court) found that Reynolds violated the MSA's prohibition of youth targeting in its magazine advertising. The key to the case was evidence that Reynolds' advertisements reached youth to an even greater degree than they reached adults.

The MSA says nothing to indicate that the intention of the agreement was to preclude the cigarette companies from using themes or images which might appeal to youths. They simply can't target youth (i.e., use themes or images which appeal more to youths than adults).

If NAAG's interpretation of the Master Settlement Agreement were correct, then virtually all cigarette advertising - including all of Marlboro's and Newport's advertising - would be prohibited by the MSA. Show me a Marlboro ad that does not appeal "to young people’s psychological needs for rebelliousness, sensation-seeking, and risk-taking." By the same reasoning the Attorneys General are using to demand that R.J. Reynolds discontinue its Camel promotion, they would also have to demand that Philip Morris discontinue all of its Marlboro advertising. It doesn't take a rocket advertising executive to figure out that the Marlboro Man and Marlboro Country are designed specifically to appeal to "young people's psychological needs for rebelliousness, sensation-seeking, and risk-taking."

In fact, virtually all cigarette advertising is based on an appeal to core values of rebelliousness, sensation-seeking, and risk-taking. Why are the Attorney Generals being so selective in only demanding that R.J. Reynolds discontinue its advertising of Camel cigarettes via this one promotion? How can NAAG possibly justify allowing the continuation of Marlboro marketing under the very terms it alleges preclude Reynolds from advertising Camel in the way it is doing.

Clearly, it was not the intention of the signatories to the MSA to prohibit all cigarette advertising. It was obviously not their intent to preclude cigarette companies from using themes - like rebelliousness and risk-taking - that appeal to youths. Had that been the intent, then the MSA's restrictions on advertising would have looked very different. The MSA would have simply banned the use of any images or themes that appeal to youth, or which could be construed to be likely to appeal to youth and therefore increase youth smoking.

The intent of the Attorneys General was not to reduce youth smoking. Rather, the intent was two-fold:

(1) To make it look like they were doing something about youth smoking so that they would look good politically in their states and could use the MSA as a campaign tool to further their political careers; and

(2) To bring in huge amounts of money to their states.

That the Attorneys General are now complaining about advertising tactics that they specifically and intentionally allowed the cigarette companies to use in the MSA makes this story nothing more than one of sour grapes.

The rest of the story is that the Attorneys General forged a really crummy deal. For their own political gain, they sacrificed the protection of the public's health and institutionalized, rather than prevented, the use of youth-appealing imagery and themes to market cigarettes.

The Attorneys General therefore have no one to blame but themselves. R.J. Reynolds is only following the terms of the contract. They are merely doing what they are explicitly permitted to do under the agreement which the Attorney Generals themselves signed.

Not only is NAAG misinterpreting (or perhaps misrepresenting) the terms of the Master Settlement Agreement, but the Attorney Generals have now become the victims of their own individual greed and the sacrifice of the public's health to that greed.

More than anything else, this is a story about political greed and money, and about the violation of the responsibility to represent the public's best interests as Attorney Generals of a state.

And above all, it is a story of sour grapes.

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