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R.J. Reynolds Ads Draw $11.4-Million Penalty

California

December 23, 2004|Debora Vrana | Times Staff Writer

R.J. Reynolds Tobacco Co. agreed Wednesday to pay a $11.4-million penalty and curb its ads in magazines with large teen audiences to settle a state lawsuit over its advertising practices, state Atty. Gen. Bill Lockyer said.

"This settlement is an important victory in the ongoing effort to end tobacco advertising that targets our children and helps them get hooked on a deadly product," Lockyer said. "R.J. Reynolds has finally agreed to adopt serious, effective limits for advertising in magazines that have disproportionately large numbers of young readers."

The complaint, filed in March 2001, alleged that R.J. Reynolds' cigarette ads in magazines such as Hot Rod, Spin and Rolling Stone violated a landmark 1998 settlement between cigarette makers and the states that banned the marketing of tobacco products to youths. Although R.J. Reynolds' major competitors had taken steps to reduce teens' exposure to their ads, Reynolds had not, the complaint alleged.

Reynolds, the nation's second-largest cigarette maker, had argued that it was targeting ages 21 and older and couldn't stop younger readers from being exposed to the advertisements.

Reynolds spokeswoman Ellen Matthews could not be reached for comment.

As part of the settlement, which was approved by San Diego County Superior Court Judge Ronald S. Prager, the tobacco company will pay $11.4 million in civil penalties and $5.9 million to cover costs. Prager ruled in June 2002 that R.J. Reynolds had to pay a $20-million penalty, but a California appeals court in March ordered him to reconsider the penalty.

Under terms of the settlement, if the total number of teens comprises 15% or more of a magazine's total readership, R.J. Reynolds would be banned from advertising in the publication except under limited circumstances, Lockyer said.

The settlement covers the brands R.J. Reynolds owned when the lawsuit was filed, including Camel, Winston, Salem and Doral, as well as brands the company acquired last July including Kool, Lucky Strike and Pall Mall.

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