United States v. Philip Morris USA Inc.

This appeal stemmed from the parties' dispute over the precise language used in "corrective statements" cigarette manufacturers were ordered to disseminate. The district court's remedy requiring the manufacturers to issue corrective statements complied with the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. 1964(a), because the manufacturers would be impaired in making false and misleading assurances about cigarettes if simultaneously required to tell the truth. In this case, the court held that the modified preambles satisfy RICO. Therefore, the court rejected the manufacturers' argument that the only reason to prefer the government's proposal is to taint manufacturers with implications of past wrongdoing. In regard to the manufacturers' First Amendment challenge, the court concluded that the preamble requirements are reasonably related to the government's interest in preventing deception of consumers. Here, the preambles are confined to purely factual and uncontroversial information, geared toward thwarting prospective efforts by manufacturers to either directly mislead consumers or capitalize on their prior deceptions by continuing to advertise in a manner that builds on consumers' existing misperceptions. In regard to the manufacturers' challenge to the topic descriptions in the preambles to Statements C and D, the court concluded that the manufacturers waived its argument as to Statement D, but the language in Statement C was not previously considered and is indeed backward-looking, because it implies that the manufacturers previously sold and advertised cigarettes in such a way. Accordingly, the court affirmed in part and reversed in part, remanding for further proceedings. View "United States v. Philip Morris USA Inc." on Justia Law