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Tobacco Giant R.J. Reynolds Ordered to Pay the State $8 Million in Penalties and to Stop Deceptive Advertising

CONTACT: Mark J. Di Stefano, Assistant Attorney General, (802) 828-3177

June 6, 2013

In a lawsuit brought by the Vermont Attorney General’s Office, a Vermont Superior Court judge has ordered R.J. Reynolds Tobacco Company to pay the State of Vermont $8.3 million in penalties for violating Vermont’s consumer protection laws. Judge Dennis Pearson imposed penalties based on Reynolds’ deceptive advertising of one of its tobacco products, Eclipse, as a “risk reduction” cigarette. The judge also issued an injunction that prohibits Reynolds from making “risk reduction” claims for its tobacco products without supporting studies that have been accepted by the scientific community.

“This decision is a multi-million-dollar wakeup call for Reynolds and other tobacco companies,” said Attorney General William H. Sorrell. “If you make unsubstantiated health claims about your deadly products, you will pay dearly. Any attempts to advertise alternative tobacco products with deceptive health-benefit claims will not be tolerated. Once again, Vermont has led the way on tobacco issues with nationwide implications, establishing an important precedent in the ongoing battle to protect consumers.”

Judge Pearson found that Reynolds committed thousands of violations by using deceptive “reduced risk” claims to promote a non-traditional cigarette, Eclipse, through an extensive multi-media advertising campaign: in print ads placed in nationwide publications, on a website Reynolds maintained for over four years, in direct mail materials it sent to Vermont consumers, and on cigarette packages of Eclipse sold in Vermont. He also found that Reynolds continued making its illegal statements for more than two years after receiving a letter from 40 Attorneys General demanding that Reynolds stop.

In an earlier ruling in March 2010, Judge Pearson found that Reynolds violated consumer protection law and a prior court order because it did not have sufficient scientific studies to support its advertising claims that Eclipse would reduce smokers’ chances of developing cancer. In the latest ruling, Judge Pearson concluded that Reynolds should be required to pay substantial civil penalties for its violations and that an additional injunction should issue against Reynolds to prevent similar conduct by Reynolds in marketing other tobacco products in the future.

  Website consulting provided by The National Association of Attorneys General.