Divided Supreme Court allows ‘light’ cigarette lawsuits (Dec. 15, 2008)

A divided Supreme Court held that tobacco companies are vulnerable to state lawsuits arising from claims that their labels make misleading health claims.

The case arose when a class of smokers in Maine sued the makers of Marlboro Lights and Cambridge Lights, Philip Morris USA, under Maine’s Unfair Trade Practices Act. The smokers alleged that Philip Morris’ marketing, describing the cigarettes as “light” and having “lowered tar and nicotine,” was deceptive because smokers might compensate for the reduced tar and nicotine by altering their smoking habits, making the products equally unhealthy as non-light cigarettes at the end of the day.

In the case, the federal district court found that the class’ claims were preempted by federal law because the federal Labeling Act of 1965 gives the Federal Trade Commission the authority to regulate all cigarette labeling and advertising that touches on the health impact of smoking. The First Circuit reversed this conclusion, finding that the state law claims were not preempted.

The First Circuit reasoned that the class had recourse to state law. It acknowledged that FTC policy has long encouraged smokers to switch to low-tar and low-nicotine cigarettes and requires companies to use a standardized tar and nicotine measurement system to facilitate comparative shopping. However, it observed that the Trade Commission has never adopted a formal rule governing the way companies describe their cigarettes' tar and nicotine content.

The First Circuit openly observed that its opinion stood in conflict with a Fifth Circuit opinion, Brown v. Brown & Williamson Tobacco Corp., 479 F.3d 383 (5th Cir. 2007).

Seeking review, Philip Morris's parent company suggested that the Court's most recent attempt to draw a line between the federal government’s scope of authority over cigarette marketing and the states' purview over it, Cipollone v. Liggett Group, Inc., 505 U.S. 504 (1992), was proving difficult to follow. That opinion reached different conclusions on the viability of various state law claims, with splits among the justices.

The class countered that the FTC has not specifically permitted tobacco companies to use the “low tar” or “low nicotine” descriptions, thereby leaving room for the states to permit lawsuits based on those marketing formulations. It also drew a different conclusion from Cipollone, concluding that the Court only barred states from establishing tobacco company duties to give information based on smoking and health, but did not preclude them from requiring companies to be truthful generally.

On Dec. 15, a 5-4 Supreme Court affirmed the appeals court decision. "The Labeling Act does not pre-empt state-law claims like respondents’ that are predicated on the duty not to deceive," Justice John Paul Stevens wrote for the majority. "We also hold that the FTC’s various decisions with respect to statements of tar and nicotine content do not impliedly pre-empt respondents’ claim."

Justice Clarence wrote for the dissent. He was joined by Chief Justice John G. Roberts Jr. and Justices Antonin Scalia and Samuel A. Alito.