"Sunlight is the best disinfectant" - Justice Brandeis

The Tobacco Newsletter® is a compilation of news previously posted on the Tobacco News®BBS. ©1994 Gene Borio

This issue covers the following stories from December, 1993:

FEDERAL NEWS

Rostenkowski Urges Moderation In Tobacco Tax
Federal Workplace ETS Control Urged
Nafta Deal: Taxes for Votes?
Burning Nafta Question

HEALTH NEWS

'Health Companies" Attacked
Smoking And Impotence
Vitamin C Helps Smokers' Sperm
Smoking and Fat

LOCAL NEWS

Ny Nursing Home Wins Right to Ban Smoking
Mass. to Fund Anti-tobacco Ads
Market to Help Lessen Kentucky's Dependence on Tobacco
Chicago Tribune Urges Governor to Veto Tobacco Bill
Illinois Gets Preemption
California Kids' Smoking Statistics
No Enforcement of La Ban
San Diego Passes Smoking Ban

INTERNATIONAL NEWS

Canada Losing $1 Billion a Year to Cigarette Smugglers
Canada's Smoking Decline Imperiled by Smuggling
France Gets Brooklyn Bridge to US-style Cigarettes
Firms Sign Unusual Tobacco Advertising Pact in Poland
Ec Attacked on Ad Ban after Swiss Vote
Spain's Tabaclera Cuts Dividend 46%
Tabacalera to Raise Prices 16.8%
St. Petersburg: Russia's Tobacco Capitol
Mrs. Arafat Bans Smoking
Sale of Japan Tobacco Shares Protested
Japan Tobacco Listing Delayed
Rothman's Pan-Asian Merge Crippled

BUSINESS NEWS

Tobacco Company Executives Testify
Time Targets Smokers With Philip Morris' Database
Philip Morris to End Marlboro Adventure Team Feb. 4
RJR To Lay Of 6,000, Restructure
USTobacco, On A Roll, Switches Bosses
Salomon Analyst Downgrades UST
Some Background On Smokeless Tobacco

SOCIETY

Anti-Philip Morris Ad Debuts
Teen Smoking on Rise Since Joe Camel Came
Tobacco Murders

SPORTS

Billy Jean and Virginia Slims

PEOPLE

More Letterman Tobacco Advertising

THE FUNNY PAGES

FEDERAL NEWS

ROSTENKOWSKI URGES MODERATION IN TOBACCO TAX

Chicago, IL. December 1, 1993. Rep. Dan Rostenkowski (D-IL), Chairman of the House Ways and Means Committee, said he is in favor of an increase in tobacco taxes, but not to point where businesses or jobs would be threatened.. In a speech to a business group today he said he had listened to arguments by tobacco interests and unions that Clinton's proposed $.75 tax increase on cigarettes--and much higher increases on other tobacco taxes--would be onerous to many businesses and employees.

The House Ways and Means Committee is responsible for raising the revenues needed to pay for the health plan, and has been listening to comments on the proposed Health plan.

Rostenkowski indicated he would wait for an analysis from the Congressional Budget office on the health plan's cost before making decisions about how to raise the necessary funds.

Other notable parts of the speech, which Rostenkowski made to the Midwest Business Group on Health.:

"I think there was agreement that tobacco taxes should be increased, but not to a point where the survival of some businesses was threatened. Putting a company out of business isn't a very effective ways of raising revenue. . . But this is a question we can't really deal with until we understand what the Clinton program will cost."

"We will not enact the president's plan with every punctuation mark unchanged. There will be changes. But the president will sign what we create and get political credit for it."

FEDERAL WORKPLACE ETS CONTROL URGED

Dec. 2, 1993. A coalition of workplace-health groups argued today that the government is required by the Occupational Health and Safety Act (OSHA) to restrict smoking in the workplace. The groups urged Labor Secretary Robert Reich to control second hand smoke just like any other Class-A carcinogen.

"Smoking-related diseases are a primary cause of death among Americans today," said Dr. Elizabeth E. Gresch, president of the American College of Occupational and Environmental Medicine. "OSHA should regulate ETS on the basis of known carcinogens in smoke the same way the agency regulates other known airborne carcinogens. For example, OSHA does not permit employers to expose workers to hazardous levels of arsenic....Nor does OSHA allow asbestos, another known human carcinogen, to exceed certain exposure limits."

"The easiest way to provide a smoke-free environment is to ban workplace smoking," said the Arlington Heights, Ill.-based Coalition on Regulation of Workplace and Environmental Tobacco Smoke. The group is made up of American College of Occupational and Environmental Medicine, the American Industrial Hygiene Association and the American Association of Occupational Health Nurses.

FTC PARALYZED IN ACTION ON JOE CAMEL

Dec. 4, 1993.

The FTC Commissioners, apparently paralyzed by the prickly legal issues involved with a ban of the RJ Reynolds Joe Camel ads--widely criticized, as aimed directly at under-age children--are deadlocked on the issue, according to an article by Paul Farhi in today's Washington Post.

The Coalition on Smoking and Health urged the Federal Trade Commission to ban the ads in 1991, in the wake of studies showing children as young as a pre-literate 3 recognized--and connected to cigarettes--the cartoon character, Joe Camel. Last summer the entire staff of the FTC urged the 5 Commissioners to ban the ads. More recently, the attorneys general of 27 states urged a ban.

But, an unnamed source told the Post, "This is not a cut and dried case. It's on the periphery of settled law and that is difficult for (the commission). ... I think it's an ugly baby that showed up on their doorstep. They don't know what to do with it."

The American Civil Liberties Union, which has received $500,000 from the tobacco industry over the past 5 years, has argued that such a ban would be a violation of the First Amendment and would set a dangerous precedent.

"When you consider that 3,000 kids start smoking each day, to have the commission sit on something of this magnitude is really a public health travesty," said Scott Ballin, chairman of the Coalition on Smoking or Health,

RJ Reynolds argues that its ads are aimed at smokers only 18 years and older, and claims surveys show under-age smoking declining over the past 5 years (the campaign, which is credited with reviving the Camel brand, began in 1988). Spokeswoman Peggy Carter also said that no research has proven that simple awareness of a brand leads teenagers to smoking.

GATT & TOBACCO

Geneva, Dec. 17. Bitter fighting over bananas and tobacco is clouding the euphoria over the recent GATT accord.

The European Community is battling Latin American countries over its import quotas, and the United States successfully fought off an attempt by tobacco exporting nations to establish an independent panel to rule on the US's new domestic content quotas.

At the final monthly GATT meeting of the year, Brazil, leading the tobacco nations (Chile, Colombia, El Salvador, Guatemala, Thailand and Zimbabwe), called for the panel. The nations said their questions and protests at the Oct. 4 meeting had gone unanswered by the US. The US said it could not agree to the panel, and that it was still consulting with Washington to answer the Oct. 4 protest.

BACKGROUND ITEM FROM TOBACCO NEWS:

FOREIGN TOBACCO LIMIT ENDANGERING GATT NEGOTIATIONS

Oct. 7, 1993. The US is being attacked over the provision slipped into Clinton's deficit bill (Omnibus Budget Reconciliation Act of 1993) that holds the use of foreign tobacco in domestically produced cigarettes to 25%. This has hurt GATT (General Agreement on Tariffs and Trade) negotiations. Eight countries (Canada, Guatemala, El Salvador, Colombia, Venezuela, Brazil, Thailand and Zimbabwe) and the European Community have filed a formal protest.

According to an in-depth article by Michael Janofsky in the New York Times, the "little-noticed provision", spearheaded by Senator Wendell Ford (D-KY)--Philip Morris' #1 recipient of political contributions in the last election campaign--and Rep. Charlie Rose (D-NC), helps two parties:

1. Tobacco farmers are helped, temporarily. But the provision also makes it more attractive to produce cigarettes overseas, where a higher percentage of cheap foreign tobacco can be used, and cigarettes can be manufactured with cheap foreign labor.

2. Philip Morris, which is the only US company rich enough to be making major financial investments in manufacturing facilities in middle Europe, China and Kazakhstan, is the main beneficiary. As manufacturing moves offshore, accelerated by this provision, Philip Morris is excellently positioned to be independent of US plants, labor and regulations.

Three years ago Thailand, in an effort to prevent American cigarettes from being imported and advertised, attempted a similar regulation. Some at that time felt the U.S. tobacco industry wanted to undermine Thailand's official anti-smoking campaign and to glamorize smoking among youth and women. They cited what happened in three other Asian countries--Japan, South Korea and Taiwan--where U.S. cigarette brands gained market access. The US strongly protested Thailand's restrictions to a GATT panel, and Thailand was forced to back down.

Many feel the US provision, besides creating rancor among the GATT negotiators trying to conclude an agreement by Dec. 15, will be rebuffed as Thailand's was. Janofsky closes his NY Times article: "Back then one of those leading the charge against Thailand was the Democratic Senator from Kentucky, Mr. Ford"

FROM TOBACCO NEWS, 9/13:

Recently, during negotiations on Clinton's deficit control bill, tobacco-oriented lawmakers had argued that a limit on the use of imported tobacco should be placed in the bill. Representative Charles Rose (D-NC) in defending the idea, pointed to the $1 to $2 proposed cigarette tax and said, "we can live with that special treatment...if we get a little special treatment on imports." The deficit control bill now limits the use of tobacco imports in domestically produced cigarettes to 25%.

NAFTA DEAL: TAXES FOR VOTES?

Dec. 26, 1993. In a Washington Post article on "the orgy of deal-making" that went into the House's approval of the North American Free Trade Agreement, Charles Lewis brought attention to the pact--trading votes for tobacco taxes--that Clinton may have made with Charlie Rose.

Lewis writes in "Shafted by NAFTA: Clinton Reinvented the wheeler-dealer and taxpayers get stuck with the tab:"

Rep. Charlie Rose (D-N.C.) played a crucial role in the House anti-NAFTA working group . . . until literally hours before the vote. But Rose had told a reporter that "I could be persuaded by the White House if they were sufficiently serious to lower the tobacco tax to pass NAFTA." Rose was then lobbied by the White House and wound up voting for NAFTA.

"I didn't sell my vote," Rose insisted to reporters. "I just told those people: `Look, if I vote with you, I want you to be as understanding as you possibly can about the kinds of problems agriculture has and needs to address in 1994."

In other words, Rose's vote was bought on a layaway plan. The ultimate cost, if any, won't be known until next year, when the Clinton administration sends Congress its proposal to raise taxes on cigarettes.

Related Item from Tobacco News:

BURNING NAFTA QUESTION

Nov. 18, 1993. Why did Charlie Rose (D-NC) and Tim Valentine (D-NC) vote for NAFTA? Rose has been a staunch opponent of NAFTA, until early this month when he said, "However, I could be persuaded by the White House if they were sufficiently serious to lower the tobacco tax," i.e., if in return Clinton would lower the proposed health care bill's cigarette tax rise from $.75 to $.24 a pack.

Last week, anti-NAFTA Majority Whip David E. Bonior (D-Mich.) had felt his side had the votes to win "unless they cut a deal on tobacco" or "find some other things in their cupboards."

Pressed on the matter last November 11, Clinton said, "I cannot foresee the circumstance in which I would be willing to change that position because it would imperil the whole health care program.

Tobacco state legislators did not vote as a block, to be sure, but Charlie Rose (D-NC) and Tim Valentine (D-NC), who have been especially active lately in fighting tobacco legislation, both voted yes on NAFTA.

A secret deal with the White House is unlikely, as undoubtedly both sides knew tobacco exports to Mexico stand to increase 10-fold over ten years under NAFTA, and that Rose's comments were a bluff.

HEALTH NEWS

'HEALTH COMPANIES" ATTACKED

Dec. 2, 1993. Companies that make and market health products have come under attack for providing goods and services to tobacco companies. Dr. Alan Blum, of Doctors Ought to Care, said hospitals and doctors should shun these medical services of these companies--which often tout themselves as deeply concerned about health--if alternates are available.

Blum pointed out some health-product suppliers refuse to deal with tobacco companies. The Swedish firm Procordia, which until the tobacco arm was sold recently had both a tobacco and pharmaceutical division. "It looked bad," said a spokesperson for Pharmacia.

The companies Blum cited include:

--Pfizer (pharmaceuticals), whose ads proclaim, "We're part of the cure," makes flavor enhancers for cigarettes.

--3M makes asthma medicine but also "actively encourages tobacco use as the largest outdoor advertising company in the United States," according to Blum. National Advertising, the billboard company, is a subsidiary of 3M.

--Sandoz, which makes asthma medicine, sell tobacco seeds and pesticides. --Ciba-Geigy, which makes nicotine skin patches also sells tobacco pesticides --Kleenex's parent, Kimberly-Clark, is a major supplier of cigarette paper and filters.

--Hoechst Celanese makes a drug for blood circulation, and a cigarette filter fiber.

--Marion Merrell Dow makes patches, and sells chemical humidifiers to tobacco companies.

"I don't care what they do, but they shouldn't portray themselves as healthful companies," said Blum.

The companies defended themselves by saying basically that they couldn't control how their products are used.

--Pfizer: "Our customers do many things with our products and this is one of them."

--Sandoz: "We don't feel it's correct to make up personal choices for people," --Ciba-Geigy: "I guess we don't see a conflict."

--Kimberly-Clark pled the bottom line: "The objectives of Kimberly-Clark are the corporation's success," said spokesperson Jean Allen. "I don't think there's a hypocrisy. If we discontinued our tobacco business, a lot of people would lose jobs. That's as important as any issue."

SMOKING AND IMPOTENCE

Dec. 16, 1993. In a report on impotence in older men, the New England Research Institute in Watertown, Mass found that much impotence is caused by heart disease. In addition, among men being treated for high blood pressure or heart disease, those who smoked nearly doubled their risk of impotence.

Dr. Mitchell Harman of the National Institute of Aging in Baltimore, which funded the research, said, "Many of the problems associated with impotence may be modifiable today. Cigarette smoking and other risk factors for (cardiovascular) disease are good places to start."

VITAMIN C HELPS SMOKERS' SPERM

Heavy smokers commonly suffer decreased sperm count and motility, but a new study indicates moderate doses of Vitamin C may help the condition. Heavy smokers who took 200-1000 milligrams of Vitamin C a day for one month showed increased sperm count over smokers who didn't, the rate of increase co

correllated with the amount of Vitamin C, according to the study by Earl Dawson, PhD, associate professor of obstetrics and gynecology, University of Texas Medical Branch, Galveston.

SMOKING AND FAT

San Francisco, Dec. 30, 1993. Just as the Virginia Slims ads seem to imply, smoking does indeed help burn body fat, a new study reported today.

The study was the first to show that smoking stimulates lipolysis, a bodily process that frees lipids, or fats, from cells and deposits them into the bloodstream.

Some of the freed lipids are burned off by the higher metabolism, but many are converted by the liver into triglycerides, substances which contribute to clogging of the arteries, and can alter the balance of "good" and "bad" cholesterols.

Cholesterol levels as a whole increase after cigarette smoking, and the balance between good (HDL) and bad cholesterols shifts to the bad cholesterol (LDL) that is linked with heart disease.

"It's one reason why smokers, over time, would have heart disease and arteriosclerosis: Their cholesterol is worse," said University of California professor Marc K. Hellerstein, lead author of the study.

The study estimated that a moderate smoker burns about 200 calories a day--equivalent to the amount burned when a person walks 2 miles in 45 minutes.

Hellerstein pointed out that "Smoking, from a health point of view, is much more risky than weighing those extra few pounds."

Hellersteing in April released a report that was the first to document the mechanism by which smoking contributes to an increase in LDL.

LOCAL NEWS

NY NURSING HOME WINS RIGHT TO BAN SMOKING

Dec., 1993. Maplewood, the nursing home near Rochester, NY that was told by the New York State Health Dept. that it had to allow smoking, has won a legal battle to keep it's 46-year-old ban.

MASS. TO FUND ANTI-TOBACCO ADS

Dec. 29, 1993

The Massachusetts Tobacco Education Media Campaign is awarding up to $600,000 to Massachusetts minority businesses to research, develop and execute anti-tobacco ads targeted to African American and Latino communities.

The firms will work with the campaign's leading advertising agency, Houston, Effler & Partners, and will be responsible for creating approximately 2 print ads, 2 to 4 TV spots, and 2 to 8 radio spots, plus outdoor advertising.

The awards will be given to two companies, one to target the African American community, and one to target the Latino. All minority-owned firms are encouraged to bid regardless of ethnicity.

A bidders' conference will be held from 3-5PM Tuesday, Jan 4 at the Howard Johnson's Hotel, 200 Stuart St., Boston.

Letters of intent are due to Houston, Effler by Jan 7, 1994. Interested firms may receive a copy of the RFP (Request for Proposal) from Tanya Bhatt at 617-267-5050.

Further information about the Massachusetts Tobacco Control Program can be obtained by contacting John Bentz or Maurice Lewis or Dawn DiMartino of Cone Communications, 617-227-2111.

PROPOSED MARKET TO HELP LESSEN KENTUCKY'S DEPENDENCE ON TOBACCO

Kentucky's Agricultural Commissioner wants to build a $22 million farmer's market, to help offset farmers' losses from tobacco.

The market would be situated along I-75 in Northern Kentucky, where the idea enjoys wide support. Proponents hope the market would help attract food wholesalers and food- processing plants.

Critics argue Cincinnati, Ohio, which is near the proposed site, already has a huge, similar market, and that the money would be more effectively spent by establishing a farmers' co-op.

All agree burley tobacco sales, which opened last month, are off, partly because manufacturers are not buying because of fear of the effects of the Clinton Health bill's proposed $.75 cigarette tax increase. 30% of this year's burley crop remains unsold.

CHICAGO TRIBUNE URGES GOVERNOR TO VETO TOBACCO BILL

Dec. 7, 1993. The Chicago Tribune today urged Illinois Governor Jim Edgar to veto a bill--passed by the House and Senate, and awaiting Edgar's signature to become law--that prevents local communities from passing any new tobacco taxes.

Calling the bill "devious" and "sneaky," the Tribune said, "This is an indecent attempt by state politicians to curry favor with the tobacco industry at the expense of local governments." The Tribune editorial indicated that the tobacco industry was furious last summer when the Illiinois legislature passed a $.14 increase in cigarette taxes, and that the legislature was "trying to buy its way back into the good graces of the tobacco industry" when it passed the preemptive bill.

The newspaper concludes: "The healthy thing for Edgar to do is veto this bill."

ILLINOIS GETS PREEMPTION

Dec. 27, 1993. Governor Edgar of Illinois has signed into law a bill that prevents local governments from taxing cigarettes to raise local revenue. Localities with tax programs in place before July, 1993 are allowed to keep their taxes.

TOBACCO POURING MONEY INTO CA LEGISLATURE

San Francisco, Dec. 15, 1993. A new study found tobacco interests have targeted the anti-smoking movement in California and are making vastly increased contributions to legislators who support their interests. The tobacco industry spent $7.6 in the 1991-92 election. (Almost 10 times the amount spent in the 1985-86 election.) The study predicts even more money will flow this year, as the industry mobilizes to defeat re-authorization of a tobacco-education portion of a tobacco tax bill.

In a study by the University of California, San Francisco, researchers found lawmakers who supported the industry-approved measures--including one that would pre-empt local commnities from passing tougher smoking restrictions than state ones--received four to five times more in industry contributions.

The financial influx was triggered in 1988, when voters passed Proposition 99, raising the state tobacco tax on cigarettes by 25 cents a pack, and specifying 20% of the revenues to research and tobacco education. Previous studies have found this bill remarkably effective in reducing smoking in California.

Since the funds for education must be re-authorized during the upcoming session, the study's authors predict the tobacco industry will be pouring even more money into the California political arena.

In a related development, Gov. Pete Wilson has appointed ex-tobbacco industry spokesperson Kimberly Belshe to head California's Department of Health. Belshe was the chief Southern California tobacco spokesperson against Proposition 99. If she wins confirmation, Belshe will head the department which runs the smoking control campaign funded by the 25-cent-per-pack tobacco tax.

Gov. Wilson, the recipient of substantial contributions by the tobacco lobby, last year tried to redirect the money from the tobacco control program, but was defeated by a lawsuit brought by the American Lung Assoc. He defended his choice by saying, "Her grasp of health policy and her command of detail make her an exceptional manager and leader." Dr. Stanton Glantz, of the University of California San Francisco said, "I am absolutely shocked that the governor would name her health director. She is absolutely unqualified and a completely inappropriate choice." Unlike most of her predecessors, Belshe is not a physician.

CA: KIDS' SMOKING STATISTICS

According to the California Dept. of Education's survey of 5,000 teens, 1% of 7th and 8th graders smoke, 3% of 9th graders, 5% of 10th and 11th graders, and 7% of 12th graders smoke.

SANTA CLARA, CA BANS SMOKING IN BARS

Dec. 8, 1993. Santa Clara, Cal. After two highly charged public meetings, the Santa Clara City Council has banned smoking in bars, restaurants, bingo parlors, bowling alleys and meeting rooms. The only public areas in the city where it is legal to smoke are now private hotel rooms and outdoor eating areas.

"It's time to take a stand," said Mayor Everett Souza. "This is a way of eliminating some of these catastrophic illnesses."

The council passed the ban, after several attempts at compromises, by a vote of 4-3 at a grueling 5 hour public meeting at which-- because of threats of violence made at a previous meeting--Police and Fire personnel were stationed. Nearly 300 people, most opposed to the ban, attended the meeting. Though only 165 were allowed in, those outside listened through loudspeakers.

Dramatic appeals were made by both sides, one side strongly feeling lives were at stake, and the other feeling their livelihoods were at stake. Two girls made an emotional appeal to spare bingo parlors, which sponsor their synchronized swimming team. A tearful bar owner felt sure he would go out of business and be unable to support his mother. Two council members also shed tears recounting loved ones who had died. One member said he didn't care if his decision ruined his political career, if even one person was saved.

Davis, California has a similar but even tougher anti-smoking law, the toughest in the state. Smoking even in outdoor areas of restaurants is forbidden.

NO ENFORCEMENT OF LA BAN

Los Angeles, CA. Dec. 2, 1993. There has not been one citation issued to a restaurant in the four months since a law banning smoking in restaurants went into effect.

An assistant city attorney said LA sends out letters informing the restaurants of the law, but has no enforcement unit. "Most people comply," the attorney said. The city hopes the patrons will do the policing, she said.

"It's true that I have not heard of any penalties being imposed for infractions but the response has been overwhelmingly in compliance," said City Councilman Marvin Braude, who championed the ordinance.

SAN DIEGO PASSES SMOKING BAN

San Diego City Council passed a smoking ban that requires restaurants to dedicate 70% of their seating to a non-smoking area by July, 1994, and 80% by 1995. The new law also prohibits smoking in the workplace--though separate smoking areas may be established--and increases the fines for violation of workplace smoking. The misdemeanor now carries a fine of up to $1,000, plus up to six months in jail.

MN RETAIL POP AD BAN

The City Council of the City of Brooklyn Center, MN ( a suburb of Minneapolis) will consider an ordinance this Monday (6 Dec 93) which would ban the advertising of tobacco products at the point of retail sale. Retailers would be permited to display plain-text statements "We sell tobacco products", but could not have display advertising, rack displays, or other promotional materials where customers (particularly children) could see them.

--Dec. 5, 1993. Posted by Christopher K. Sandberg,TwinCity Mac

INTERNATIONAL NEWS

CANADA LOSING $1 BILLION A YEAR TO CIGARETTE SMUGGLERS

Toronto, Canada. Dec. 1, 1993. A government inquiry was told today that cigarette smugglers are costing Canada businesses $1 billion and are driving corner stores out of business.

Geoffrey Pottow, president of Becker Milk Co. Ltd, said his chain has had to close more than 50 stores because of revenues lost to cigarette smugglers.

The Ontario Corner Stores Association estimates retail loses at $1 billion.

Local police have stated that 50,000 cartons of cigarettes cross the border illegally every day at just the Cornwal, Ontario border checkpoint.

CANADA'S SMOKING DECLINE IMPERILED BY SMUGGLING

Dec. 22, 1993. Canada's record decline in smoking rates over the past 10 years is in danger of slowing--or even reversing--if the government can't control its smuggling problem, a Canadian anti-smoking group said today.

The Non-Smokers' Rights Assn. said that because steadily rising taxes, smoking declined about 40% from 1982-1992, but that recent statistics indicate the decline has stalled. The group criticized the government for being slow to respond to the cigarette smuggling problem, thought to account for 25% of tobacco consumption. By avoiding Canadian taxes, smuggled cigarettes can be sold for nearly half-price.

FRANCE GETS BROOKLYN BRIDGE TO US CIGS

Dec. 7, 1993. SEITA, makers of the potent Gauloise cigarettes, has released an American-style cigarette, named "Brooklyn." The brand has been successfully test-marketed in France, and is meant to appeal to those French who prefer American brand cigarettes, thus eating into American companies' market share.

This is SEITA's second foray into the American style market. Their first, a brand named "News" was apparently a success. A pack of 25 sells for $2.40. The pack looks simple and elegant, and features the Brooklyn Bridge on one side. "The Brooklyn Bridge is very popular in France, it's the eighth wonder of the world," said one French commentator

FIRMS SIGN UNUSUAL TOBACCO ADVERTISING PACT IN POLAND

Dec. 2, 1993. Warsaw, Poland. Foreign and domestic tobacco firms signed an unusual pact today, agreeing to abide by certain rules of advertising. The deal seeks to tone down "dirty competitions" among tobacco companies, said Piotr Piwkowski, a representative of R.J. Reynolds Tobacco Poland. "It is the first deal in Eastern Europe which aims at curbing advertising of tobacco products," he said.

The deal between 7 Polish and 6 foreign tobacco companies calls for clearly visible health warning labels to be placed on cigarette packs and billboards, and for a ban on billboards near schools and playgrounds.

Poland, a nation of heavy smokers, is suffering a large increase of deaths from tobacco-related deseases, nearly double the percentage rate since 1975.

EC ATTACKED ON AD BAN AFTER SWISS VOTE

Brussels, Nov. 30, 1993.

The tobacco industry tore into the European Community's plan for a ban on tobacco advertising today, claiming a recent Swiss vote that overwhelmingly turned down such a ban shows there is no support for it.

The EC proposed the ban two years ago, but Germany, the Netherlands and Britain have blocked drafting the legislation.

In the referendum Nov. 28, the Swiss voted against a tobacco advertising ban, with 1,512,772 voting against it, and only 518,051 voting in favor. A health group had gathered over 100,000 signatures to bring the matter to a vote, but the government opposed the ban as causing economic damage to the media and promotors of cultural and sports events.

Jean Lepere, chairman of the Confederation of European Community Cigarette Manufacturers, which represents the major tobacco companies, said in regard to the Swiss vote, "Switzerland is the only European country where the case of the proponents of an advertising ban has been put to the electorate by referendum. The result emphatically shows that there is no popular mandate for a ban. . . `There is now an overwhelming case for a fundamental review of the Commission's proposal on tobacco advertising."

The European Publishers Council, representing a number of newspapers which carry tobacco advertising, also seized upon the Swiss vote. Frank Rogers of Britain's Daily Telegraph, speaking for the Council, said, "The Swiss referendum proves what we have been saying all along...that neither European citizens nor European industries favor a 'Nanny State' which hinders freedom of trade and communication and freedom of personal liberties."

SPAIN'S TABACLERA CUTS DIVIDEND 46%

Dec. 21, 1993. Spain's national tobacco company, Tabaclera, announced today it was cutting its dividend by 46%, dropping from 96 pesetas a share to 52. Tabaclara, which also derives income from the sale of official state forms and postal stamps, said this was in line with its drop in profits of 43% from 1992, and that its recent austerity program, including a second year's pay freezes for executives, would cut costs significantly.

TABACALERA TO RAISE PRICES 16.8%

Madrid, Dec. 31, 1993. The Spanish tobacco company Tabacalera SA announced today that the price of a pack of cigarettes will rise 16.8% Jan. 1. They say most of the rise is because of an increase in the tax on cigarettes in 1994, and that without the tax, the price rise would only be 3.5%.

ST. PETERSBURG: RUSSIA'S TOBACCO CAPITOL

St. Petersburg, Dec. 17, 1993. With the announcement of plans by Britain's Rothmans International Plc St. to build an $82 million plant on its outskirts, St. Petersburg confirms its role as Russia's tobacco capitol. This marks the third large investment in the area from a foreign tobacco company.

RJReynolds has entered a joint agreement to increase production at a local plant from 12 to 20 million cigarettes/year.

Philip Morris will convert an electronics factory to produce cigarettes, and use the proceeds to build a new $50 million plant nearby.

Rothman's new plant, a joint venture with Nevo Tobacco Limited, will begin producing 10 billion cigarettes a year, but can be expanded to produce 20 billion, should conditions in Russia--where determnining the number of smokers is difficult, since demand has traditionally outstripped supply--warrant.

MRS. ARAFAT BANS SMOKING

Tunis, Tunisia. Dec. 30, 1993. According to Sharon Waxman of the Chicago Tribune, Suha Arafat, the 30-year-old ex-Christian wife of Yasser Arafat, plans to work for women's and children's rights when the couple moves to the Israeli de-occupied West Bank. Presently, at their villa in Tunis, she has "gotten rid of the retinue of cigarette-smoking, Kalashnikov-toting men who inhabit the ground floor of other PLO villas; and she has banned smoking in the second-floor living quarters."

SALE OF JAPAN TOBACCO SHARES PROTESTED

Tokyo, Japan. Dec. 1, 1993. A Japanese health group held a news conference today at the Tokyo Stock Exchange to claim that potential Japan Tobacco investors could lose their shirts should Japan Tobacco be sued over the health effects of cigarettes.

The Metropolitan Association for Control of Tobacco opposes the government's plan to sell off part of the government-owned Japan Tobacco before the end of the fiscal year, claiming such increased recognition would enable the company to sell even more cigarettes. Japan Tobacco owns 83% of the market in Japan, which has a high concentration of smokers.

The health group claimed that potential investors could be liable, should American-style lawsuits begin to be filed in Japan.

Japan Tobacco, once a government agency, was made a private company in 1985, but the government still owns all 2 million shares. Thus, there is little medical research done on the health effects of tobacco. Warning labels caution smokers, "Let's not smoke too much."

The Japanese government is waiting for an optimum period in which to place the shares on the block. The poor health of the Tokyo Stock Exchange may delay the listing until next fiscal year.

Last month Japan Tobacco paid $370,000 in an out-of-court settlement to the family of an employee who, it was claimed, had died of overwork. This is the largest amount ever paid in Japan for death from overwork.

JAPAN TOBACCO LISTING DELAYED

Tokyo, Dec. 17, 1993.

The Ministry of Finance today announced that the government-owned Japan Tobacco would not be listed on the Nissei stock exchange in this fiscal year.

ROTHMAN'S PAN-ASIA MERGE CRIPPLED

Kuala Lumpur. Jan. 1, 1993. After a tense New Year's Eve vote in Singapore, Rothmans International PLC's ambitious plan to merge is Asian operations was dealt a possibly crippling blow by the rejection of the plan by Rothmans Malaysia.

The geographic reach of the new company would have been immense, stretching from Rothmans' Northeast Asian territories of China and Japan, through Rothmans Singapore Southeast Asian territories of Thailand, and Vietnam, to Rothmans Malaysia.

Analysts felt only two investors had the number of shares to sway the vote. The recalcitrant investors were thought to be the Malaysian armed forces retirement fund, and the investment funds controlled by the Malaysian government's main investment arm.

The objections of the investors were not disclosed, but Rothman's may go ahead with a more limited version of the plan. Certainly without the wealthy Rothmans Malaysia, expansion would proceed much more slowly.

BUSINESS NEWS

EXECUTIVE TESTIMONY RIPPLES

New York. December 7, 1993.

Recent sworn testimony by tobacco company executives has sparked withering scorn by at least threee writers in New York newspapers. The statements were elicited by the $6 billion class action lawsuit filed in Miami by airline flight attendants, and writers have used the testimony to attack not only the executives, themselves, but those who associate with them.

In "The Tisch Empire Has a Smoking Gun," Jimmy Breslin of the Daily News takes both Laurence Tisch (head of CBS and P. Lorillard, makers of True and Newport) and "the entire Tisch family" to task for Andrew's statements on the stand.

The occasion for the article was a hearing about guns as a health hazard, held at Tisch Hospital (formerly NYU hospital). This hospital was named for Laurence Tisch, who once, at a Loew's stockholder meeting, was informed by Joe Cherner of Smokefree Educational Services, "Everyone knows you gave $50 million to New York University Hospital. It even changed its name to Tisch Hospital. This is the first time in the history of philanthropy that one man has provided the patients, the insurance, and the hospital."

Outside the gun hearing, a woman from the American Cancer Society was passing out press releases titled, "Cigarettes kill more than guns," which reported much of the Miami testimony. This same day, notes Breslin, Stanley Rosenblatt, the attorney representing the flight attendants, was at the Waldorf-Astoria, taking further depositions.

Talking about Lorillard, Breslin states, "One of their brands is True. I know this because I know two people who died from True. Another brand is Newport. I can take Laurence Tisch, his son, his brother, Bob Tisch, and the whole Tisch family to St. John's Cemetery in Queens and show them a Newport smoker. That the Tisches sell cancer did not mark their money lousy, as it should have, when they gave it to NYU."

Breslin first quotes a portion of president of Philip Morris William Campbell's testimony:

ROSENBLATT: Mr. Campbell, you mentioned, I believe that one of your children is a teenager.

CAMPBELL: That is correct.

ROSENBLATT: . . . The 16 year-old, hypothetical question, comes over to you and says, you know, "Daddy, I'm thinking of becoming a smoker. . . What do you think, Dad?

CAMPBELL: "I would prefer that you waited until you were in a position to make a reasonable adult choice . . ."

ROSENBLATT: "I'm now 22. My question is, you know, Daddy I want to smoke . . . but, you know, you're the president of Philip Morris. . . If you tell me not to smoke, I won't smoke." What would you tell her?

CAMPBELL: I would tell her, "Have you assembled all the information that you need to make that decision."

ROSENBLATT: And she sayd, "You are my final authority. I have read a lot of conflicting information. I'm confused."

CAMPBELL: I would--it's her adult decision in the end. I can't--

ROSENBLATT: Now I know why you contributed to the American Civil Liberties Union. You're a liberal. Just let her die."

CAMPBELL: If she is fully informed.

Breslin reprints the testimony of Andrew Tisch, Chairman and chief executive of Lorillard Tobacco Co., "for all to see for themselves exactly the type of people we are dealing with."

ROSENBLATT:Does cigarette smoke cause cancer?

TISCH: I don't believe so.

ROSENBLATT: Based on what?

TISCH: Based on my understanding of the scientific and statistical evidence that's been presented.

ROSENBLATT: What is your understanding of the scientific and statistical evidence that's been presented?

TISCH: There's been no conclusive scientific eveidence that's been presented tht convinces me that cigarette smoke causes cancer.

ROSENBLATT: So, since you, as the chairman and chief executive of Lorillard, believe that it hasn't been proven that smoking causes lung cancer, heart disease and emphysema, why do you have that on your packages?

TISCH: Because this is what is required of us as a matter of law.

ROSENBLATT: You have to do it?

TISCH: That is correct.

ROSENBLATT: If you didn't have to do it, you wouldn't do it?

TISCH: Not necessarily.

ROSENBLATT: As far as you're concerned, Mr. Tisch, as the chairman and chief executive officer of Lorillard, this warning on the package which says that smoking causes lung cancer, heart disease and emphysema is inaccurate? You don't believe it's true?

TISCH: That's correct.

ROSENBLATT: Because if you believed it were true, in good conscience you wouldn't sell this to Americans, would you? Or foreigners, for that matter?

TISCH: That's correct.

Referring to Tisch's 15 year old son:

ROSENBLATT: Does he smoke?

TISCH: Not to my knowledge.

ROSENBLATT: If he did, to your knowledge, what would you do about it?

TISCH: Seeing as he's 15 years old, I would probably not be very happy. he's not old enough to make that decision.

ROSENBLATT: Would you prohibit him from smoking?

TISCH: Yes.

ROSENBLATT: Why?

TISCH: Because smoking is an adult choice.

ROSENBLATT: What's wrong with a 5 year old smoking if smoking doesn't cause adverse health consequences?

TISCH: I'm not saying that it doesn't. I said I'm not convinced of it.

ROSENBLATT: So just so I'm understanding, your position is that smoking may very well cause lung cancer, heart disease and emphysema, but you're not convinced that it does?

TISCH: That's correct.

ROSENBLATT: when will you consider your kids an adult to make the dicision as to whether or not they can smoke, when they're 18, or 21 or what?

TISCH: Eighteen.

ROSENBLATT: And when your kids turn 18 and it became their practice to smoke a pack and a half a day and you were aware of it, what if anything would you say to them?

TISCH: I think that's a hypothetical question. I'm not sure what i would say to them at that point.

ROSENBLATT: You certainly don't contend that smoking was good for anybody, do you?

TISCH: I've never said it was good for someone.

: Would you prefer that your children not smoke at 18 than that they smoke, or are you entirely neutral on that subject?

TISCH: I would prefer that they not smoke.

MORE TOBACCO EXEC TESTIMONY

Although several tobacco industry executives said they would refuse to testify if a reporter were present ("We do not comment . . . to outside parties," according to Martin Orlowsky, executive vice president-marketing of Lorillard Tobacco Co.), the Miami Herald has obtained more testimony from the $5 billion lawsuit filed in Florida on the behalf of airline flight attendants. The attendants claim they developed emphysema, lung cancer, pregnancy complications and other illnesses from breathing second-hand smoke on airlines in the days when smoking was allowed on planes. After a nine-month battle, Attorney Stanley Rosenblatt has succeeded in calling to the witness stand several top tobacco company executives.

***

William CAMPBELL is president and chief executive officer of Philip Morris Inc. (Marlboro, VIrginia Slims, Merit). Mr. CAMPBELL is in his early 50s, is divorced, and has two children. He smokes about 10 cigarettes a day and earned about $800,000 last year.

ROSENBLATT: "Is cigarette smoking, is tobacco addictive?"

CAMPBELL: "No, I do not believe that tobacco smoking is addictive."

ROSENBLATT: " . . . What do you say to all of those people that say, you know, 'I have tried to quit smoking. I have been to courses. I have been to shrinks. I stopped for a few days, but I can't stop. I'm back.' "

CAMPBELL: "I say there are 50 million Americans that have quit, and if you set your mind on it and that is what you really want to do, you will do it."

ROSENBLATT: "Willpower?"

CAMPBELL: "Uh-huh."

ROSENBLATT: "So, with respect to all of the scientific studies and with respect to all of the surgeon general's reports saying that cigarette smoking caused cancer, as I understand it, your conscience is perfectly clear as the president of Philip Morris Inc., because you don't think it's been proven . . . ?"

CAMPBELL: "I think that I sell a legal product in a legal way. The public is warned about the risks associated with the product."

ROSENBLATT: "And if they smoke the product and they get cancer, tough? They got what they deserve?"

CAMPBELL: "I don't wish ill health on anyone."

ROSENBLATT: "Of course you don't, but if they smoke your product, they have been warned . . . ?"

CAMPBELL: "My attitude is not cavalier, but I have no further comments . . ."

ROSENBLATT: "To your knowledge, has anyone at Philip Morris, at any management level, ever quit their job because, in good conscience, they felt cigarettes caused cancer, heart disease and death . . . ?"

CAMPBELL: "Not to my knowledge."

ROSENBLATT: "Mr. CAMPBELL, you mentioned, I believe, that one of your children is a teen-ager?"

CAMPBELL: "That is correct."

ROSENBLATT: " . . . The 16-year-old -hypothetical question -comes over to you and says, you know, 'Daddy, I'm thinking of becoming a smoker. . . . What do you think, Dad?' "

CAMPBELL: "I think that you are too young to make that decision."

ROSENBLATT: " 'OK. But I am going to start smoking.' "

CAMPBELL: "I would prefer that you waited until you were in a position to make a reasonable adult choice . . . ."

ROSENBLATT: "I'm now 22. My question is, you know, 'Daddy, I want to smoke .T.T. but, you know, you're the president of Philip Morris . . . . If you tell me not to smoke, I won't smoke.' . . . What would you tell her?"

CAMPBELL: "I would tell her, 'Have you assembled all the information that you need to make that decision?' "

ROSENBLATT: "And she says, 'You are my final authority. I have read a lot of conflicting information. I'm confused.' "

CAMPBELL: "I would -it's her adult decision in the end. I can't -"

ROSENBLATT: "Now I know why you contributed to the American Civil Liberties Union. You're a liberal. Just let her die."

CAMPBELL: "If she is fully informed."

***

Andrew Tisch, 44, is chairman and chief executive officer of Lorillard Tobacco Co. (Kent, Newport, True). Lorillard is owned by Loews. Laurence Tisch, Andrew's father, is the chairman of Loews and CBS. Neither of them smokes. Tisch earned $500,000 last year.

ROSENBLATT: "If you walked away from Lorillard tomorrow morning because you became convinced that cigarettes are a lousy business, causing disease and death to millions of your fellow Americans ... , your life style wouldn't change one iota, would it? You'd still be a very wealthy man, wouldn't you?"

TISCH: "Yes."

ROSENBLATT: " . . . And you do buy that MAYBE cigarette smoking causes cancer, heart disease, emphysema and death. I'm simply asking you, if it turns out that this is true, why sell these billions of cigarettes and contribute to killing people?"

TISCH: "If it turns out that's true, I will be very upset."

ROSENBLATT: "But you have an option today. You could just get out of the business . . . . My question is, what do you need it for?"

TISCH: "I don't think there's an answer to what do you need it for."

ROSENBLATT: "Well, the answer is embarrassing. The answer is obviously more money."

TISCH: "That's not necessarily the answer."

***

Martin Orlowsky is executive vice president-marketing of Lorillard, and is a former vice president of R.J. Reynolds Tobacco Co. He began smoking at 18. He smokes one pack a day. He has twice tried to quit Orlowsky earned $323,000 last year.

ROSENBLATT: "Was it difficult for you to quit smoking or you just decided one day to quit and you quit?"

ORLOWSKY: "When I decided to quit, I quit."

ROSENBLATT: "With no problems?"

ORLOWSKY: "No."

ROSENBLATT: " . . . And then four years later, you decide you're going to smoke again?"

ORLOWSKY: "Correct."

ROSENBLATT: "No reason?"

ORLOWSKY: "No, other than my personal decision to resume smoking."

ROSENBLATT: " . . . Are cigarettes addictive?"

ORLOWSKY: "I do not believe they are."

ROSENBLATT: "Based on what?"

ORLOWSKY: "My own personal experience."

ROSENBLATT: "How do you address the issue in your advertising of getting new smokers to start smoking to replace all the smokers who have quit?"

ORLOWSKY: "We do not advertise to non-smokers."

ROSENBLATT: "Are you telling me that all the advertising of Lorillard is for the purpose of getting already committed smokers to switch from Marlboro or other lines to your line?"

ORLOWSKY: "That is correct."

ROSENBLATT: "And Lorillard has no interest whatsoever in creating new smokers?"

ORLOWSKY: "That is correct."

***

Michael Rosenbaum is executive vice president of Brooke Group Ltd., the holding company which owns Liggett Group Inc (Chesterfield, L&M, Eve). Rosenbaum does not smoke.

ROSENBLATT: "You believe cigarettes cause cancer, don't you, smoking cigarettes?"

ROSENBAUM: "I'm not a medical doctor. I don't have a clue."

ROSENBLATT: " . . . In all candor, wouldn't you equate those who say cigarettes don't cause cancer to those who assert that the Holocaust never happened?"

(Rosenbaum's attorney objects.)

ROSENBAUM: "That is a demeaning question . . . ."

(Rosenbaum's attorney objects again.)

ROSENBLATT: "Isn't it true that the reason you thought the question was demeaning is because you know I hit a nerve . . . ? Isn't it appalling to you, or do you feel, 'Hey, they're entitled to their opinion' ?"

ROSENBAUM: "It's not appalling to me."

(Rosenbaum's attorney argues with Rosenblatt.)

Rosenbaum continues: "I think that people have a right to say whatever they want . . . . "

ROSENBLATT: "And it doesn't upset you at all to have people say that cigarette smoking doesn't cause cancer?"

ROSENBAUM: "No. People are entitled to their opinions."

ROSENBLATT: "But in your opinion, the Holocaust happened and Hitler's responsible for the death of at least six million Jews, right?"

ROSENBAUM: "Yes."

(Rosenbaum bursts into tears sobbing uncontrollably. The deposition is terminated.)

***

Rosenblatt, answering questions about the depositions, accused the witnesses of "stonewalling without a speck of creativity. . . . 'There's no doubt in my mind that they all accept in their heart of hearts that smoking is a terrible evil and they are responsible for death and disease of millions of their fellow Americans.

"It's very depressing to realize that they basically don't give a damn."

TIME TARGETS SMOKERS WITH PHILIP MORRIS' DATABASE

Dec. 16, 1993. Philip Morris' computerized database of 26 million smokers, culled mainly from its "trinkets and trash" promotions--most recently its "Marlboro Adventure Team," in which applicants, in order to "Get More Gear" had to provide detailed personal information--has been a source of interest to industry observers. Such a powerful resource does not rest idle. What uses--besides the present mailings of coupons, or requests to lobby for industry issues--would Philip Morris find for it? The latest answer has privacy experts, anti-smoking activists, and smokers alarmed.

As reported by Eben Shapiro of the Wall St. Journal, Philip Morris and Time Inc. are using the database in a test that will send specially-targeted issues of magazines containing Philip Morris cigarette ads to subscribers on the database.

Some Dec. issues of Time, People and Sports Illustrated will be a part of the test.

Neither Time Inc. nor Philip Morris would comment on the experiment.

The tactic could be a preparation for the possible day that cigarette ads are outlawed, and a deflection of criticism that cigarette ads are meant to recruit new smokers, something the tobacco companies have consistently denied. Yet, "Deep in their hearts, they know cigarette advertising will be banned," claims Martin Walker, head of the magazine consulting firm Walker Communications.

Anti-smoking activists claim such marketing would make it harder for smokers to quit. "It is a very insidious reinforcement of a habit that the majority of smokers wishe they didn't have," said a source at the Centers for Disease Control and Prevention.

Smokers and privacy experts worry about discrimination based on their habit. "It concerns me that the data will fall into the wrong hands," says David Brenton of the United Smokers Association. He worried that some employers, insurance companies, and smoking cessation product manufacturers would be interested in such a database. Said Evan Hendricks, editor of the Privacy Times, ""I would be concerned about being on that database."

A Philip Morris spokesperson strenuously denied the idea that Philip Morris would sell or release the list

PM TO END MARLBORO ADVENTURE TEAM FEB. 4

Dec. 21, 1993. Philip Morris today announced its intention to end the Marlboro Adventure Team promotion Feb. 4, but said it intends to develop similar events over the next two years. "Continuity promotions have worked very well for the brands," a spokesperson said.

The "Go for the Gear" promotion encouraged consumers to send in proofs-of-purchase in exchange for merchandise from cigarette lighters to jackets. PM has said 4 million people have sent in for nearly 14 million articles. PM's estimated cost for the promotion: $250 million, or 10% of its advertising budget.

RJR TO LAY OF 6,000, RESTRUCTURE

New York, NY. Dec. 7, 1993. RJR Nabisco Holdings Corp announced today it will lay off about 6,000 workers and take a fourth-quarter restructuring charge of $445 million, or $.32 per share.

The layoffs represent almost 10% of RJR Nabisco's workforce of 63,000 worldwide. The company said the jobs will come from both the tobacco and food operations (although analysts expect them mostly to come from the tobacco unit) and will be spread among administrative, sales, promotions and operations over the next several years. Promotion and merchandising costs will also be cut.

Charles M. Harper, chairman and chief executive officer of RJR Nabisco, said, "Our restructuring program is intended to improve margins in both the tobacco and food businesses, so we can resume our earnings growth track next year."

The charge is meant to increase profitability by $250 million a year.

RJR Nabisco, manufacturers of Winston, Camel and Oreo Cookies, was hard-hit by the cigarette price war this year. Net income plunged 58% in the third quarter. Harper said, "with 1993 almost behind us, we are setting the stage for earnings growth in 1994."

Two weeks ago arch-rival Philip Morris, which makes Marlboro and Virginia Slims, announced it was cutting 8% of its workforce, close 40 plants, and also take a restructuring charge.

"This is a year that will live in domestic cigaret infamy," said PaineWebber analyst Emanuel Goldman. "Marlboro Friday had repercussions this year and probably forever. lt has resulted in a permanent, significant drop in the profitability of the domestic cigarette business."

UST, ON A ROLL, SWITCHES BOSSES

Nov. 30, 1993.

Joy L. Haenlein of the Stamford (CT) Advocate examined the growth of Greenwich, CT-based United States Tobacco company, and the increased profits on its smokeless (snuff, chewing or spitting )tobacco products. Ex-president Louis F. Bantle's marketing acumen has been credited for the health of the company. UST markets itself as Country-Western America, and sponsors numerous rodeo and racing events.

The occassion for her article was the transfer of leadership from Louis F. Bantle, who took over the company in 1972 and brought it from sales of $100 Million in 1973 to sales of over $1 billion in 1992, and 85% of the domestic moist smokeless tobacco market--to Vincent A. Gierer Jr., the new chairman and chief executive officer of UST. Gierer is also president of the company. Skoal is UST's most well-known product.

--"It's open and free and on the road!"

--"It's fun!"

--"It's Country-Western!

--"Racing and rodeo!"

--"It's jeans and cowboy boots!" the two men chorused for Ms. Haenlein during the interview.

"Basically, Lou created a vision of the marketplace for our product and then, through racing and rodeo, created a feeling around the product," Grier said.

The two men grew more sober when confronted with medical data that claim snuff users are at 50% greater risk for developing oral cancer, and the smokeless tobacco causes gum disease.

"The only study we're aware of that talked about the health risk of smokeless tobacco was done in the early '80s," Gierer said. "We have not seen any substantial study reaffirming that."

They claimed they support the industry's Smokeless Tobacco Council's "for adults only," campaign, which is meant to discourage teens from taking up the practise.

UST profits are up 13% for the first 9 months of 1993, and the company's long range plans include increasing their share of the international snuff market, enhancing their winery business (they have four, in Napa Valley, CA, and Washinton state), and making films and videos with their Cabin Fever Entertainment group, which markets and plans to make films with a country-western theme.

Cabin Fever owns rights to "Lonesome Dove," "Return to Lonesome Dove," "The Gambler Returns," "Harley Davidson: The American Motorcycle" and "The Real Patsy Cline." The company is planning to create a movie-making group to produce 4 films a year. The first will be "Sioux City", a $3 million project starring, and directed by, Lou Diamond Phillips.

SALOMON ANALYST DOWNGRADES UST

Dec. 17, 1993. According to Dow Jones, Salomon Bros. Diana Temple has downgraded United States Tobacco, Inc. (Skoal, Copenhagen). Temple. cited concerns about excise tax increases, increasing activity against smokeless tobacco by health advocates, and the stock's failure to respond positively both to UST's recent 17% dividend increase, and to its 6.3% price rise.

SOME BACKGROUND ON SMOKELESS TOBACCO

Moist snuff is a lighter, finer alternative to chewing tobacco, and is much preferred by younger users. It is also a cheaper nicotine-delivery system than cigarettes. Users typically go through 3 cans a week at around $2.30 a can. Cigarette smokers will typically go through at least a pack a day, at around $2.35 a pack.

UST's smokeless tobacco products include Copenhagen, Skoal, Skoal Long Cut and Skoal Bandits. Other products marketed by UST include premium wines sold nationally through the Chateau Ste. Michelle, Columbia Crest, Conn Creek, and Villa Mt. Eden wineries

UST is one of the most profitable industrial companies in the US, enjoying a margin of about 28%, which makes it 3 times more profitable than pre-Marlboro Friday Philip Morris. It has continued to grow despite the negative publicity from a 1986 product liability lawsuit filed by the family of Sean Marsee. Sean began using Copenhagen snuff at the age of 13, when he received a free sample at a rodeo. 6 years later he died of oral cancer. UST won the case in 1989.

Broadcast advedrtising of smokeless tobacco was banned in 1986, 15 years after the ban on cigarettes.

More than 12 million Americans used smokeless tobacco in 1991, 14% of whom were between the ages of 12 and 17.

The medical community connects smokeless tobacco with cancers of the cheek, gum and thoat. Dental professionals connect it with gum and tooth problems. Cardiovascular disease is widely associated with nicotine intake, absorbed through mouth tissues in the use of smokeless tobacco. Recent research has shown that one-third of the nicotine in snuff is swallowed accidentally in saliva, as is one-half of the nicotine in chewing tobacco, opening users to ulcers and cancers of the digestive system.

Only 43 states require a minimum age for purchasing smokeless tobacco. In some of those, the minimum age is as low as 16.

SOCIETY

ANTI-PHILIP MORRIS AD DEBUTS

Dec. 13, 1993. The Washington Post's Saundra Torry covered a story today about Virginia lawyer Neil Kuchinsky, who, as a way of getting revenge for the Miller Light "Great Lawyer Roundup" ad, has produced a spoof of the ad that slams Philip Morris, Miller's parent company.

Out of the gate runs a sickly, smoking executive named "Philip Millerd," who is easily caught by a cowgirl as a "cancer widow" shouts "Get 'im!"

The $4,000 ad, which Kuchinsky calls a public service announcement--though his law firm's name is flashed at the end--will start running this week in the Richmond, Va. area. Kuchinsky is hoping for donations and contributions to pay for continued air time.

He won't discuss how much such air time costs. "I don't want Philip Morris or my wife to know."

TEEN SMOKING ON RISE SINCE JOE CAMEL CAME

Dec. 17, 1993. A researcher says that teen smoking has shown a dramatic rise since the Joe Camel campaign began in 1987. After a fifteen year decline in the number of new smokers, whether adult or teen, John Pierce of the University of California, San Diego, says that while the number of adults taking up smoking has dropped to almost nothing, teen smoking has risen.

In 1988, 6% of California teens age 16-18 smoked. In 1990 that figure had climbed to 8%.

Pierce claimed the Joe Camel campaign ignited the surge. Peggy Carter, spokesperson for the R.J. Reynolds Tobacco company, denied the charge and pointed a finger at Philip Morris: "We have never seen any evidence that the Joe Camel character has caused kids to want to start smoking. It has all been conjecture," she said. She pointed out that Marlboro (made by arch-rival Philip Morris) remains the most popular brand of underage smokers.

TOBACCO MURDERS

Nov. 30, 1993. Fresno, CA. Lester Ireland, 26, was stabbed to death by a stranger when he was asked for a cigarette, and replied he had none. Ireland and his wife had just gotten out of their car in a residential neighborhood when they were approached.

Nov. 23, 1993. Sacramento, CA. A mistrial was declared in the case of Toby Titus Wade, who stabbed a waiter, Sameh Rizk, to death in an argument over Mr. Wade's smoking.

After three days of deliberation, the jury was deadlocked. 7 favored a conviction for 2nd degree murder, and 5 favored a conviction for involuntary manslaughter. The judge declared a mistrial.

Prosecutor Richard Scherrer said "They seemed to have hung up on the intent. No one felt there was an intent to kill."

Wade had plead self-defense. He had entered the restaurant with a lit cigarette, in violation of Sacramento's smoking laws. Rizk confronted him, and though Wade put out the cigarette, angry words and racial epithets were exchanged. Rizk retreated to a back office. Wade followed him there, and after a scuffle, stabbed him in the heart.

Nov. 30, 1993. Richmond, CA. A young woman who shotgunned another young woman in an argument sparked by smoking but seeming to center on child-rearing will go on trial for murder, a hearing decided today. Other charges against Daphnye S. Luster, 22, are assault with a deadly weapon, firing a firearm within city limits and being an ex-felon in possession of a firearm.

The killing of Rachell Rashan Houston, 19, took place on Sep. 25, 1993, in the parking lot of a Denny's restaurant in San Pablo, a community about 15 miles north of San Francisco.

Houston and 4 companions exchanged words with Luster, who was with her 5 children and was smoking in the non-smoking section. One of the group said loudly that Ms. Luster shouldn't be out so late with her children, and called her an "old tramp."

Testimony today indicated that Houson was simply a bystander and did not say anything to Ms. Luster. The defense attorney indicated he will argue that Ms. Luster felt she and her children were threatened when confronted by a group of "loud and aggressive" women.

ORIGINAL REPORT FROM TOBACCO NEWS:

September 27, 1993 In a suburb of San Francisco Saturday morning, Daphnye Luster, 22, mother of four, began smoking a cigarette in the non-smoking section of Denny's restaurant. At another table, a group of five women complained to the manager, who had Ms. Luster extinguish it. Words were exchanged between Ms. Luster and the women. Ms. Luster left but returned later with a 12 gauge shotgun, and shot in the head Rachell Rashan Houston, 20, as she drove from the restaurant.

Thomas Lauria of the Tobacco Institute said of the incident, "While no one can condone that violence, a possible explanation of it is the kind of nasty, state-sponsored ads they bombard Californians with that ridicule smokers."

SPORTS/PEOPLE

BILLY JEAN AND VIRGINIA SLIMS

In November, Bob Herbert in his Op-Ed column in the New York Times had stated that professional tennis players were being used by Philip Morris--manufacturer of Virginia Slims--for the promotion of smoking. Billie Jean King subsequently wrote a reply to the Times, claiming tennis players were not being used, and that "not one of the Virginia Slims players had ever been asked by those who work for Philip Morris to smoke, appear in cigarette advertising or otherwise endorse smoking."

Now Ira Berkow, a NY Times sports columnist has pressed the attack on Billie Jean King, using some of the testimony from the Florida case.

In "A Match for Smoking, not Tennis," Mr. Berkow says, "The last thing one might expect of Billie Jean King is for her to play the ostrich." He calls Ms. King's statement "ingenuous, at best," and cites the subtle endorsement players give by their mere association with ads that indicate smoking represents coming "a long way, baby." He notes her statement that the "Philip Morris executives I know" are people who "do not hide behind ignorance or anything else. They are enlightened people who understand and acknowledge the possible hazards of smoking."

"Billie Jean," writes Berkow, "meet William I. Campbell, president and chief executive of Philip Morris. . .

"Asked if he could name 'a single scientist or medical doctor who today will publicly say that he or she doesn't believe that it's been proven that cigarette smoking causes cancer, somebody not employed by the tobacco industry, or never got money from the tobacco industry,' he replied, 'I cannot'

"When asked about the warnings on cigarette packs and advertising that say 'Smoking by pregnant women can result in fetal injury, premature birth and low birth rate,' and whether he agreed that it was accurate, Campbell said, 'I don't know.'"

Berkow concludes his article, "It is dishonest and destructive to portray cigarette smoking as anything but what it is--lethal."

PEOPLE

MORE LETTERMAN TOBACCO ADVERTISING

Alternative comic artist Ruben Bolling has brought attention to another tobacco advertisement appearing regularly on the David Letterman show. Last week the title of Bolling's comic strip, "Tom the Dancing Bug," which appears in about 35 weekly newspapers, was, "Those Sneaky Tobacco Company Weasels or Stupid Cigarette Advertising Tricks." Bolling notes that the familiar red and black Marlboro billboard appears twice in the background set.

A spokesperson for the Letterman show said, "The background we use replicates the New York skyline and its surroundings, including billboards."

PREVIOUS ITEM FROM TOBACCO NEWS 9/6/93:

CAMEL CIGARETTES ADVERTISED NIGHTLY ON DAVID LETTERMAN Sep. 7, 1993. Within its introductory video montage, David Letterman's new show on CBS includes a large, readily-identifiable portion of the "Smooth Character" Camel billboard in Times Square, thus rendering ineffective the 1970 ban on cigarette advertising on television.

ITEM FROM TOBACCO NEWS 10/7/93:

In doing a little advertising for tobacco companies, however, the Letterman show plays no favorites. Almost the entire RJ Reynolds' "Smooth Character" Joe Camel billboard in Times Square is prominently featured in the opening montage each night, and a large portion of a black-and-red Marlboro billboard consistently peeks out of the background behind Dave's left shoulder when he's seated at his desk.

THE FUNNY PAGES

*Top Ten Rejected Freedom Airline Marketing Slogans

10. Come take a ride on a flying ashtray
9. Remember, you can't spell tarmac without tar.
8. If this sounds like a good idea to you you're just the kind of loser we're looking for.
7. Every meal prepared by the loving hands of a creepy humanoid camel
6. Soon we'll have gambling and hookers!
5. Will that be smoking, or chain-smoking?
4. Fly the phlegmy skies
3. Oxygen masks? Never had 'em, never will
2. If he were still alive, the Marlboro Man would have flown with us.
1. Kids cough free.

--David Letterman

*Freedom Air, the first airline exclusively for people who want to smoke, quit flying this week. Forecasters say the airline will probably resume flying by next spring, and then quit, and start again for several years to come.
--Kevin Nealon, Saturday Night Live

*...a new booklet, the Virginia Slims "Book of Days." Maybe it should be called "Book of Days Left."
--Jay Leno

*...a guy in California burned down 40,000 acres with a discarded cigarette. 40,000 acres. Guess that's what they mean by "Marlboro Country."
--Jay Leno

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