ASH Daily News for 25 September 2008

Hollywood 'paid fortune to smoke'

Tobacco firms paid huge amounts for endorsements from the stars of Hollywood's "Golden Age". Industry documents released following anti-smoking lawsuits reveal the extent of the relationship between tobacco and movie studios. One firm paid more than $3m in today's money in one year to stars. Researchers writing in the Tobacco Control journal said "classic" films of the 1930s, 1940s and 1950s still helped promote smoking today.

Virtually all of the biggest names of the 1930s, 1940s and 1950s were involved in paid cigarette promotion, according to the University of California at San Francisco researchers. They obtained endorsement contracts signed at the times to help them calculate just how much money was involved.

According to the research, stars prepared to endorse tobacco included Clark Gable, Cary Grant, Spencer Tracy, Joan Crawford, John Wayne, Bette Davis and Betty Grable. Deals dated from the start of the "talkie" era, with "Jazz Singer" star Al Jolson signing testimonials stating that the "Lucky Strike" brand was "the cigarette of the acting profession".

"The good old flavor of Luckies is as sweet and soothing as the best 'Mammy' song ever written," he wrote. One of the key documents uncovered by the researchers was a list of payments for a single year in the late 1930s detailing how much stars were paid by American Tobacco, the makers of Lucky Strike.

Leading ladies Carole Lombard, Barbara Stanwyck and Myrna Loy were handed $10,000, equivalent to just under $150,000 in today's money, to endorse the brand, as were Clark Gable, Gary Cooper and Robert Taylor. Together, the annual price of paying actors was $3.2m in 2008 terms.

In some cases, tobacco firms would pay movie studios to create radio shows which featured their stars' endorsements. American Tobacco paid Warner Brothers the equivalent of $13.7m for 1937's "Your Hollywood Parade", and sponsored The Jack Benny Show from the mid-1940s to the mid-1950s. The latter featured stars such as Lauren Bacall giving carefully scripted testimonials.

The researchers, led by Professor Stanton Glantz, said that the effects of the millions poured into Hollywood by "Big Tobacco" could still be felt today, despite a recent self-imposed ban on promotion within films. They say that smoking imagery in films can influence younger people to start smoking. They wrote: "As in the 1930s, nothing today prevents the global tobacco industry from influencing the film industry in any number of ways."

"Classic" films with smoking scenes, such as "Casablanca" and "Now, Voyager", and glamorous publicity images helped to "perpetuate public tolerance" of on-screen smoking, they said. UK anti-smoking group ASH said that while smoking imagery could not be "outlawed completely", there was an argument for clearer warnings before films.

Source: BBC News, 25 September 2008
Link: http://tiny.cc/AGzeN

Imperial Tobacco considers joining tax exodus

The tobacco giant is reviewing its tax strategy in the light of proposed government reforms to the way that foreign earnings are taxed in Britain. "We are always looking at the best tax structures," said Gareth Davis, chief executive of Imperial. "As with most corporates it is something you have to look at. We will and continue to consider it as one of the options."

Bob Drybus, finance director at the FTSE 100 company, appeared hopeful that no move would be necessary, pointing out that the government was reviewing its policy on overseas businesses. "We are keeping it under review," Mr Drybus said of a possible move offshore. "The documents are going back and forth. What corporates want is stability," Mr Davis said, appearing to criticise the government's policy amid suggestions it could tax UK companies' overseas businesses.

While the government reduced corporation tax from 30pc to 28pc in April, research published yesterday shows that 38pc of company executives have discussed moving operations offshore to reduce corporation tax. Some 39pc of the respondents to the YouGov poll, commissioned by accountants BDO Stoy Hayward, said the tax was "inefficient" and should be replaced. News of the review came as Imperial said trading remained in line with management's expectations while the integration of Altadis was on track to meet projected synergies.

"Our business fundamentals are excellent and our resilience in times of turbulent economic conditions is well known," said Mr Davis. "Smoking is one of the last things people give up. It is an incredibly resilient sector and a safe haven for investors in these times." The only negative came from Imperial's premium cigar business where Mr Davis said the company had seen some softening in sales over the last six months but continued to take market share from its rivals. Imperial's chief blamed much of that decline on smoking bans. "There is no such thing as [going out for] a quick Montecristo," he said.

Mr Davis also took the opportunity to blast reported proposals from the Department of Health to help reduce smoking, including banning cigarettes from public displays in shops and removing branding from cigarette packs. "We are very much against it," Mr Davis said of the branding proposal. "It would be a counterfeiters' charter and an expropriation of our intellectual property." Imperial said consultations with unions in France, where it is making 1,060 staff redundant following the €12.6bn (£10bn) Altadis acquisition, were set to be completed in November. Imperial, which said it would focus on paying down debts in the coming months, saw its share price rise 71p to £18.29 in late trading.

Source: The Telegraph, 24 September 2008
Link: http://tiny.cc/FCJhW  

Pub uses electronic cigarettes to beat the smoking ban

Pubs around the country have reported a decline in custom since the rules came in July last year, but landlord, Chris Giles of the Butler's Arms in Sutton Coldfield, near Birmingham believes he has found the solution. The new E.cig smokes like a real cigarette and users get a shot of nicotine every time they inhale. The device even produces a cloud of water vapour with every puff, though causes no harm to smokers.

The Butlers Arms started selling the fake cigarettes at the weekend after seeing them in a trade magazine. Mr Giles said: "When it's freezing outside and chucking it down with rain it's a good alternative to going outside for a cigarette. "We built a smoking shelter, but it's just not the same for smokers who have been marginalised by the ban. While we are completely supportive of the smoking ban we are still very conscious of the needs of our smoking customers. We are in autumn now and winter is not very far away, so these e-cigs have come at the right time."

Mr Giles' daughter, Becky, Assistant Manager at the pub, added: "It's been really successful already, we have had lots of people ringing up and asking about it. "We've sold about 6 packs and it only went on sale at the weekend. I smoke myself and I've started using the electronic cigarettes on a night out. I'm not going to use them all the time, because I like being able to nip out for a break! They are not only healthier than normal cigarettes but really good value for money. They are really just like having a normal fag. Luckily we can tell people aren't really trying to light up because the electronic ones are black in colour with a blue light."

The device, which retails at £39.99 for a starter pack, uses a small replaceable cartridge filled with a dose of nicotine. Users can choose between No nicotine, Low, medium or high nicotine, menthol, strawberry or cherry. The makers of the product at The Electronic Cigarette Company say the vapour produced is odourless and contains no tar or carbon monoxide, resulting in no risk of passive smoking. However the company say the E.cigs are just as addictive as the real thing.

Source: The Telegraph, 24 September 20008
Link: http://tiny.cc/Nh1Xs  

Pub boss loses smoke ban appeal

A pub landlord who allowed his customers to flout the smoking ban is facing an £11,000 bill after losing an appeal against his conviction. Nick Hogan, former landlord of The Swan Hotel and Barristers Bar in Bolton, was found guilty in January of failing to prevent people from smoking there on four occasions last July. He became the first licensee in Greater Manchester to be convicted under the new laws and has now been declared bankrupt. The 48-year-old claims his bankruptcy is a result of the ban. He appealed on the grounds that he could not know people were smoking in the pub or bar when he wasn't there.

A judge refused his appeal today saying his well-publicised stance against the legislation effectively 'encouraged' people to smoke inside and he should have known they would. Mr Hogan, 48, had placed letters on tables around the pub and bar informing customers of the ban and saying it was their choice whether or not to smoke. There was also a mass 'light-up' in the pub on the day the ban was introduced. No instructions were given to staff to stop people smoking, although 'no smoking' signs were put up.

Judge Angela Nield, sitting at Bolton Crown Court said: "In short, they (customers) knew they could smoke in those premises without the prospect of any action being taken by either the management or staff. To that extent, we accept the submission that the letters were not a prohibition but an invitation. It was inevitable at any given time there were likely to be people smoking on those premises, especially only days after a protest in which a large number of individuals had ignored the law on the day it was introduced and had smoked and been allowed to smoke. Mr Hogan could reasonably have been expected to know people would smoke."

The former licensee says he has been declared bankrupt after losing custom as a result of the ban. He now faces an £11,000 bill after being told to pay £750 for each of the four offences - a total of £3,000 - original costs of £7,236 and appeal costs of £1,000. He plans to take his case to the High Court and, if that appeal fails, to the European Courts. Mr Hogan, outside the court, said: "Basically, I've been convicted of a criminal offence when I wasn't even there. "The letters to my customers clearly stated that it was a criminal offence. The one thing I haven't done is physically remove anyone from the premises. I spoke with Greater Manchester Police and the council to ask them if they would enforce it in this way, but they said it was my responsibility. "There are 35 landlords going out of business everyday in this country as a result of the smoking ban, myself included. Gordon Brown's government will jump to the defence of bankers and fat cats, but not to normal everyday businessmen and women. The smoking ban is an insult to every working class man in the country and I'll be working with UKIP (United Kingdom Independence Party) to over turn it. I'll take this appeal to the High Court and then to Europe."

The new legislation was introduced under the Health Act 2006 on 1 July last year. Environmental health officers visited on July 2, but found no one smoking. They found letters on tables, which said: "The management and staff of The Swan believe you have the freedom to choose whether or not you wish to smoke. If you choose to smoke, it is entirely your responsibility." The letters also told non-smoking customers it was their choice whether to drink there or not. The officers visited again on 5, 6, 10, 17, and 19 July, and said they witnessed customers smoking each time.

Mr Hogan originally faced nine charges, but was convicted of four. He appealed against conviction and sentence on three of the charges, using a defence afforded under law that he 'had not been aware, and could not have been reasonably expected to be aware', that customers were smoking when he wasn't there. Judge Nield said the defence would still be applicable in other cases where licensees had taken appropriate measures to enforce the ban but customers still smoked. Businesses that fail to prevent smoking can face fines of £2,500, and those caught smoking risk fixed penalty notices of £50.

Source: Manchester Evening News, 24 September 2008
Link: http://tiny.cc/wzZUp

Philip Morris USA sues to overturn controversial San Francisco sales ban on tobacco products

Philip Morris USA filed suit today in federal court to overturn a controversial San Francisco ordinance that would ban the sale of tobacco products in convenience drug stores. The lawsuit asks the court in the Northern District of California to delay enforcement of the ordinance and ultimately declare it unconstitutional. The ban, passed by a divided Board of Supervisors, already is the subject of a separate lawsuit pending in state court challenging its propriety. 

“Although called a ban on sales, the purpose and effect of the ordinance is to suppress communications directed to adult smokers, in violation of our constitutional rights,” said Joe Murillo, Altria Client Services vice president and associate general counsel, speaking on behalf of Philip Morris USA. “Likewise, the ban unfairly deprives adult consumers of the opportunity to buy tobacco products from legitimate licensed retail businesses.” The U.S. Supreme Court has established that tobacco manufacturers have a protected First Amendment right to communicate to adult consumers about their lawful products and that adult consumers have an interest in receiving that information.

Philip Morris USA supports reasonable legislation to ensure that tobacco products are sold responsibly to adult consumers in face-to-face transactions with retail clerks. It supports strict licensing laws for tobacco sales and strict enforcement of such laws, and enforces its own policies on responsible merchandising of the tobacco category. However, the San Francisco ban is unjust to manufacturers, retailers and adult consumers because it bars – without legitimate reason – certain retailers from offering legal tobacco products to adult consumers who wish to buy them. “We are asking for an expedited review of our Complaint and look forward to presenting our arguments on this issue,” said Murillo.

Source: Euro Investor, 25 September 2008
Link: http://tiny.cc/RbVFc  

Dutch cannabis smoker fined - for using tobacco

While the Netherlands has kept its liberal policy on the smoking of cannabis in the country's legendary "coffee shops", zero tolerance is now shown to tobacco smokers in Dutch cafes and restaurants after a smoking came ban came into force last July. An Amsterdam police spokesman admitted that it could be difficult to understand the current Dutch policy of allowing smokers to puff away on pure cannabis while fining tobacco users. "For logic it is sometimes impossible to explain, even to the Dutch," he said. "The man was not fined for smoking a cannabis joint but for smoking. You can smoke cannabis but not tobacco in coffee shops."

The unnamed 27-year-old man owns one of the city's coffee shops, where the purchase and smoking of cannabis is tolerated, and he is expected to contest the case in court. It will be the first test of a Dutch smoking ban that exempts people from enjoying joints as long as only pure marijuana is used. The man was caught lighting a hand rolled cannabis joint during a routine police check and fined because officers found tobacco mixed with the soft drug.

The smoking ban is usually enforced by municipal health and safety inspectors "but if a police officer signals an infringement, he does not close his eyes to it," said the police spokesman. A fifth of Dutch cafes and bars are ignoring the tobacco smoking ban, which was introduced on July 1. Many are setting up special funds to collect money to pay fines issued to smokers.

Source: The Telegraph, 24 September 2008
Link: http://tiny.cc/77ThJ