Tobacco.org

Philip Morris opens new Subic warehouse, sees sales growth 

THE LOCAL arm of cigarette maker Philip Morris International expects sales to the domestic market to grow by 2%-4% this year, better than the flat performance in 2009.

But it warned that if the Finance department pushes through with a new system to track tax payments, industry-wide sales might fall further, after recording a 10%-15% decline last year.

“I’m hoping this year will be better. We will grow in line with the industry ... which will grow 2%-4%,” Chris Nelson, Philip Morris Philippines Manufacturing, Inc. managing director, told reporters in a briefing yesterday.

Growth will occur because there will be no increases in excise tax rates, Mr. Nelson said.

Under Republic Act No. 9334, which set tobacco excise tax rates six years ago, the next hike for vice taxes will be held off until 2011. Rates were adjusted last year.

Mr. Nelson said the optimistic outlook would hold as long as the government delays the new stamp-based tracking system for excise tax payments.

Jump to full article »

Philip Morris breaks ground for P1-B Asia-Pacific warehouse 

SUBIC BAY FREE PORT—Philip Morris International (PMI) on Monday broke ground for its regional tobacco warehouse facility in this free port, starting the second phase of its investment project here that company officials said would amount to P1 billion.

Chris Nelson, managing director of Philip Morris Philippines Manufacturing Inc. (PMPMI), unveiled the project at the Subic Techno Park with Feliciano Salonga and Armand Arreza, respectively the chairman and administrator of the Subic Bay Metropolitan Authority (SBMA).

Nelson said the project would increase the capacity of PMI’s Subic warehousing facility from 6,100 metric tons (MT) at the existing refurbished warehouse in Subic’s Boton area to 24,000 MT.

The Subic warehousing facility, which began operations in 2008, handles imported tobacco leaf bought from various suppliers in the Asia-Pacific region.

Jump to full article »

Tobacco display: the battle of the ban 

When parliament voted for a ban on the display of tobacco products late last year, it seemed that convenience retailers would be burdened with the cost and operational difficulties of complying with the law. In fact, there's still plenty to fight for and, with a change of government on the cards, still plenty of detail to be thrashed out before the 2013 deadline.

The Association of Convenience Stores (ACS) is leading the fightback by pointing out to the government that the legislation as it stands goes against the stated intention to keep the burden of compliance as light as possible for small shops.

Jump to full article »

More Than $2 Million In NIH Grants To Barrow Researchers For Nicotine Studies 

Four scientists at Barrow Neurological Institute at St. Joseph's Hospital and Medical Center have been awarded more than $2.2 million from the National Institutes of Health (NIH) to research the effects of nicotine and develop new tobacco-related drug therapies.

The grants will fund three separate research projects at the Phoenix-based institute in the next several years. Ronald J. Lukas, PhD and Vice President of Research at Barrow, is one of the world's leading experts on nicotine and has spent much of his research career studying its impact. Lukas' research lab, shared by Paul Whiteaker, PhD, is the main recipient of the funding. The Barrow laboratories of Jie Wu, MD, PhD, and Yongchang Chang, MD, PhD, also will receive funding from the grants.

Lukas said these Barrow-led projects also will benefit a number of other researchers around the country who will receive collaborative NIH funding of more than $5 million for their participation in the studies. . . .

The newly-funded Barrow studies range from understanding how nicotine may reduce depression, to how it creates addiction, to how nicotine addiction is related to lung cancer.

"These studies have implications for nicotine dependence, tobacco addition, lung cancer and mood disorders,"

Jump to full article »

• Hemi Group, LLC v. City of New York (PDF) 

Respondent New York City taxes the possession of cigarettes. Petitioner Hemi Group, based in New Mexico, sells cigarettes online to residents of the City. Neither state nor city law requires out-of-state sellers such as Hemi to charge, collect, or remit the City’s tax; instead, the City must recover its tax on out-of-state sales directly from the purchasers. But the Jenkins Act, 15 U. S. C. §§375–378, requiresout-of-state sellers to submit customer information to the States into which they ship cigarettes, and New York State has agreed to forward that information to the City. That information helps the City track down cigarette purchasers who do not pay their taxes. Againstthat backdrop, the City filed this lawsuit under the Racketeer Influenced and Corrupt Organizations Act (RICO), alleging that Hemi’s failure to file the Jenkins Act reports with the State constituted mail and wire fraud, which are defined as “racketeering activit[ies],” 18 . . .

It bears remembering what this case is about. It is about the RICO liability of a company for lost taxes it had no obligation to collect, remit, or pay, which harmed a party to whom it owed no duty. It is about imposing such liability to substitute for or complement a governing body’s uncertain ability or desire to collect taxes directly from those who owe them. And it is about the fact that the liability comes with treble damages and attorney’s fees attached. This Court has interpreted RICO broadly,consistent with its terms, but we have also held that its reach is limited by the “requirement of a direct causal connection” between the predicate wrong and the harm. Anza, 547 U. S., at 460. The City’s injuries here were not caused directly by the alleged fraud, and thus were not caused “by reason of” it. The City, therefore, has no RICO claim. The judgment of the Court of Appeals for the Second Circuit is reversed, and the case is remanded for further proceedings consistent with this opinion. . . .

• Senecas threaten to target Gillibrand 

The Seneca Nation of Indians is threatening to spend $250,000 against Sen. Kirsten E. Gillibrand this year because of her support for legislation that would ban the mailing of cigarettes.

The Seneca Nation Foreign Relations Committee last week unanimously passed a resolution recommending that the Tribal Council set aside that money for "voter education and outreach." The council will consider the request Feb. 13.

The move came on the recommendation of J. C. Seneca, a leading tobacco entrepreneur and co-chairman of the Foreign Relations Committee.

"I propose that $250,000 be appropriated for a 'get out the vote' effort to educate and mobilize the thousands of workers, contractors, vendors and their families who are tied to the Nation's $1.1 billion economy as to why Senator Gillibrand is harmful to the Seneca Nation and all of Western New York," Seneca wrote in a Jan. 14 letter to the committee.

The Senecas are threatening to target Gillibrand, D-N. Y.,because of her support of the Prevent All Cigarette Trafficking (PACT) Act, a bill that the Senate could consider that would ban the U. S. Postal Service from mailing cigarettes.

Jump to full article »

US High Court Rules Against NY City On Internet Tobacco Suit  

The U.S. Supreme Court ruled Monday that New York City could not use federal racketeering laws to sue out-of-state Internet tobacco retailers that don't file reports on city residents who buy cigarettes online.

The city wants the reports so it can collect cigarette taxes directly from residents who purchased tobacco products online. The retailers are not required to collect the taxes.

The case before the high court centered on New York's allegations that New Mexico-based online retailer Hemi Group committed racketeering offenses of mail and wire fraud by allegedly failing to submit reports on its New York City customers to state tobacco administrators. The city, which said it lost millions of dollars in cigarette tax revenues, said federal law required Hemi to submit the reports. . . .

Justice Stephen Breyer said in dissent that the city made a sufficient racketeering connection to Hemi's alleged conduct. Had Hemi filed the reports, the state would have been able to obtain a significant share of the taxes it was owed, Breyer said.

Jump to full article »

Supreme Court rules city lacks standing to bring suit against 'tax-free' cigarette website 

The US Supreme Court [official website; JURIST news archive] on Monday ruled [opinion, PDF] 5-3 in Hemi Group, LLC v. City of New York [Cornell LII backgrounder; JURIST report] that the city government lacks standing under the Racketeer Influenced and Corrupt Organizations Act (RICO) [text] to bring a suit against Hemi Group, which operates websites offering cigarettes for sale "tax-free." The US Court of Appeals for the Second Circuit ruled [opinion, PDF] that the city of New York had standing to bring the RICO suit. In reversing the lower court, Chief Justice John Roberts wrote:

It bears remembering what this case is about. It is about the RICO liability of a company for lost taxes it had no obligation to collect, remit, or pay, which harmed a party to whom it owed no duty. It is about imposing such liability to substitute for or complement a governing body's uncertain ability or desire to collect taxes directly from those who owe them. And it is about the fact that the liability comes with treble damages and attorney's fees attached. This Court has interpreted RICO broadly, consistent with its terms, but we have also held that its reach is limited by the "requirement of a direct causal connection" between the predicate wrong and the harm. The City's injuries here were not caused directly by the alleged fraud, and thus were not caused "by reason of" it. The City, therefore, has no RICO claim. . . .

Justice Stephen Breyer filed a dissenting opinion, joined by Justices John Paul Stevens and Anthony Kennedy.

Jump to full article »

• New York City Tobacco Tax Suits Limited by Top Court (Update1) 

New York City can’t use a federal racketeering law to accuse discount cigarette retailers of evading hundreds of millions of dollars in taxes on Internet sales, the U.S. Supreme Court ruled.

The nation’s highest court, voting 5-3, today threw out the city’s claims under the U.S. Racketeer Influenced and Corrupt Organizations Act in lawsuits filed in 2003 and 2004.

More than 400 Web sites sell cigarettes over the Internet with many falsely advertising their sales as “tax free,” according to one of the complaints. The city accuses the retailers of not complying with a federal law requiring them to turn over information about their customers to state officials for tax-collection purposes.

Writing the court’s lead opinion, Chief Justice John Roberts said there wasn’t a close enough connection between the alleged failure to supply that information and the city’s inability to collect the taxes. The city contended it could have used the state information to pursue unpaid taxes.

“We have never before stretched the causal chain of a RICO violation so far and we decline to do so today,” Roberts wrote. . . .

The appeals court decision left open the possibility that the city might be able to press ahead with claims against the retailers under New York state law. The Supreme Court didn’t review that part of the ruling.

Jump to full article »

Cigar Store Owners Express Concern Over Proposed Indiana Smoking Bans 

Three bills aimed at banning smoking throughout Indiana are causing concern to members of the International Premium Cigar & Pipe Retailers Association because smoking bans put their businesses and thousands of jobs at stake as well as millions of dollars in tax revenues.

The two bills introduced in the state Senate - SB233 and SB95 - ban smoking in most public places and places of employment. Both bills exempt retail tobacco shops. The bill in the House - HB1131 - is similar to the Senate versions but does not exempt retail tobacco shops. None of the bills exempts cigar bars.

"Citizens of Indiana - smokers and non-smokers - should be incensed over their legislators wasting time with frivolous and job-killing issues like smoking bans," said Chris McCalla, legislative director of the IPCPR . . .

McCalla pointed out that there is no study showing that patrons or employees are harmed by exposure to the low levels of smoke found in bars and restaurants. As to some people being annoyed by others' smoking, any facility with decent modern ventilation and filtration systems would avoid that issue, he said.

Jump to full article »

Neb. Smoking Ban Complaints Add Up  

State health officials said they've received a total of 134 complaints alleging violations of the state's smoking ban that took effect in June.

The Nebraska Department of Health and Human Services says most of the complaints came from outside Omaha, Lincoln, Grand Island and Humboldt, where smoking bans were previously in effect.

Jump to full article »

VIDEO: Northern Winz Casino in Box Elder Sees Boost in Sales Thanks to Smoking Ban  

Gambling in Montana has fallen dramatically over the last few months and it has a lot to do with the Clean Indoor Air Act. But one casino in our area has actually seen a sales increase since the smoking ban passed last October. . . .

When it comes to gambling, she spends her time at Northern Winz. It's one casino in Montana that still allows people to light up because tribally owned casinos are exempt from the smoking ban. Jacobs says, "I'm a smoker and I can enjoy myself here. I can play where I want to play. I can smoke where I want to smoke."

She is like many people who have ditched their usual gambling spot for Northern Winz ever since the smoking ban went into effect last October. The casino is actually seeing people from all over the state come here to use the machines. That is because gamblers say the gambling machines go hand in hand with cigarettes.

Jump to full article »

Group wants Coos Bay as next city to ban park smoking  

It could soon be butts out for smokers in Coos Bay city parks - as a new effort is underway by a group of concerned community members, including doctors, nurses and public health workers - to ban smokers from lighting up.

Jump to full article »

Court backs some tobacco ad bans, nixes others 

A recent federal court decision moved public health advocates several big strides forward and a couple of steps back in their effort to defeat a free speech challenge to new Food and Drug Administration restrictions on tobacco advertising.

In a Jan. 5 ruling, the U.S. District Court for the Western District of Kentucky upheld most of the provisions in the federal Family Smoking Prevention and Tobacco Control Act that it said validated the government's interest in protecting consumers from misleading tobacco claims. The law, enacted in June 2009, gave the FDA authority to regulate tobacco for the first time.

Among the restrictions upheld by the court were a requirement for larger warning labels and a ban on the sale of modified-risk, or "light," products without prior FDA approval.

But the court took issue with the constitutionality of what it said were two overly broad provisions -- one prohibiting the use of color and graphics on advertisements and the other banning statements implying that FDA regulation of tobacco products makes them less harmful.

Jump to full article »

Complaints made about 4 county eateries 

Hickory - A statewide smoking ban in restaurants and bars has been in place for three weeks. During that time, four formal complaints have been made about someone smoking in a public eatery in Catawba County.

The first complaint was made on Jan. 2, the day the smoking ban went into effect, at Twin Oaks Bar and Grill in Denver, said Jennifer Shomaker, tobacco prevention coordinator with Catawba County Public Health.

Subsequent complaints have been made about smoking at First Turn Sports Bar in Denver on Jan. 11, J&L Café in Maiden on Jan. 13 and Wheelers Sports Bar in Conover on Jan. 18.

There are nearly 400 restaurants in Catawba County.

"At First Turn, the complaint said there was smoking, an ashtray or receptacle at the restaurant and that the owner or manager knew someone was smoking and did nothing about it," Shomaker said. "Two complaints were made there on the same day."

Jump to full article »