Tobacco Marketing and Advertising Restrictions in S. 1415, 105th Congress: First Amendment Issues

98-466 A

CRS Report for Congress

Received through the CRS Web

Tobacco Marketing and Advertising Restrictions

in S. 1415, 105th Congress:

First Amendment Issues

May 15, 1998

(name redacted)

Legislative Attorney

American Law Division

Congressional Research Service ˜ The Library of Congress

ABSTRACT

Sections 122-123 of S. 1415, 105th Congress, would prohibit, among other things,

outdoor tobacco advertising on billboards, tobacco advertising with human or animal images

or cartoon characters, and most tobacco advertising on the Internet. Although the First

Amendment provides only limited protection to commercial speech, S. 1415's marketing and

advertising restrictions, to the extent that they deny adults access to tobacco advertising more

than is necessary to protect children, may be unconstitutional.

Tobacco Marketing and Advertising Restrictions in S. 1415,

105th Congress: First Amendment Issues

Summary

This report considers whether the restrictions on tobacco marketing and

advertising in §§ 122-123 of S. 1415, 105th Congress, as reported by the Senate

Committee on Commerce, would, in general, violate the First Amendment’s guarantee

of freedom of speech. These sections would prohibit, among others, the following

forms of tobacco advertising and labeling: (1) advertising or labeling with a human or

animal image or cartoon character, (2) outdoor advertising, including advertising in

enclosed stadia, (3) advertising without a disclaimer that words such as "light" or

"low tar" describing the product do not render the product less hazardous than any

other tobacco product, (4) advertising or labeling not reviewed by the Secretary of

Health and Human Services before it is first used, (5) advertising on the Internet

"unless such advertising is designed to be inaccessible in or from the United States to

all individuals under the age of 18 years," and (6) advertising with other than black

text on white background except at locations where individuals under 18 are not

permitted and in publications whose readers under the age of 18 constitute 15 percent

or less of the total readership.

The First Amendment provides only limited protection to commercial speech,

such as tobacco advertising. The Supreme Court has prescribed the Central Hudson

test to determine the constitutionality of governmental restrictions of commercial

speech. This test requires that restrictions of non-misleading commercial speech

directly advance a substantial governmental interest in a manner that is not overbroad.

In 1996, in 44 Liquormart, Inc. v. Rhode Island, the Supreme Court increased the

protection that the Central Hudson test guarantees to commercial speech, expressing

skepticism of “regulations that seek to keep people in the dark for what the

government perceives to be their own good.” One may apparently infer from this

decision that restrictions on truthful tobacco advertising that is not aimed at minors

may be unconstitutional.

Subsequent to 44 Liquormart, a federal court of appeals upheld a Baltimore

ordinance that prohibited tobacco advertisements on billboards, except in certain

commercially and industrially zoned areas of the city. It reasoned that, although the

ordinance reduced the opportunities for adults to receive tobacco advertising, it did

not preclude them, and the ordinance constituted a reasonable way to attempt to limit

underage smoking. S. 1415's total ban on billboards with tobacco advertisements, by

contrast, would seem more likely to raise constitutional questions. Similar questions

may be raised with respect to other marketing and advertising restrictions, to the

extent that they deny adults access to tobacco advertising more than is necessary to

protect children. However, the fact that S. 1415's restrictions would not be as

encompassing as the restrictions on price advertising that the Supreme Court struck

down in 44 Liquormart, and would allow some tobacco advertising to continue, might

increase the likelihood of the restrictions' being upheld.

Contents

First Amendment Protection for Commercial Speech . . . . . . . . . . . . . . . . . 1

Applying Central Hudson: First Prong . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Applying Central Hudson: Second Prong . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Applying Central Hudson: Third Prong . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Applying Central Hudson: Fourth Prong . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Effect of 44 Liquormart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Analysis of S. 1415's Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Tobacco Marketing and Advertising Restrictions

in S. 1415, 105th Congress:

First Amendment Issues

This report considers whether the restrictions on tobacco marketing and

advertising in §§ 122-123 of the Universal Tobacco Settlement Act, S. 1415, 105th

Congress, as reported May 1, 1998, by the Senate Committee on Commerce, would,

in general, violate the First Amendment’s guarantee of freedom of speech. Section

122 would prohibit, among others, the following forms of tobacco advertising and

labeling: (1) advertising or labeling with a human or animal image or cartoon

character, (2) outdoor advertising, including advertising in enclosed stadia, (3)

advertising without a disclaimer that words such as "light" or "low tar" describing the

product do not render the product less hazardous than any other tobacco product, (4)

advertising or labeling not reviewed by the Secretary of Health and Human Services

before it is first used, (5) advertising on the Internet "unless such advertising is

designed to be inaccessible in or from the United States to all individuals under the

age of 18 years," and (6) advertising with other than black text on white background

except at locations where individuals under 18 are not permitted and in publications

whose readers under the age of 18 constitute 15 percent or less of the total

readership.

Section 122 would also prohibit payments to be made to ensure that "a logo,

symbol, motto, selling message, recognizable color or pattern of colors, or any other

indicia of product identification" appear in a movie, program, or video game. It

would also, apparently inconsistently with respect to movies, prohibit payments "for

the purpose of promoting the image or use of the tobacco product through print or

film media that appeals to individuals under the age of 18 years or through a live

performance by an entertainment artist that appeals to such individuals." Section 122

would also prohibit "a logo, symbol, motto, selling message, recognizable color or

pattern of colors, or any other indicia . . . identifiable with a tobacco product" to be

"used for any item (other than a tobacco product) . . . marketed, licensed, distributed,

or sold by the tobacco product manufacturer or distributor of the tobacco product."

Section 123 would limit the size and placement of, and prohibit color in, pointof-sale advertising at any location in which an individual under 18 years of age is

permitted.

First Amendment Protection for Commercial Speech

The First Amendment to the United States Constitution provides that “Congress

shall make no law . . . abridging the freedom of speech, or of the press. . . .” Despite

its absolute language, it provides no protection to some types of speech and only

limited protection to others. One type of speech to which it applies only limited

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protection is commercial speech, which is “speech that proposes a commercial

transaction.”1

Commercial speech may be banned if it advertises an illegal product or service,

and, unlike fully protected speech, may be banned if it is unfair or deceptive. Even

when it advertises a legal product and is not unfair or deceptive, the government may

regulate commercial speech more than it may regulate fully protected speech.

Fully protected speech may be restricted only “to promote a compelling interest”

and only by “the least restrictive means to further the articulated interest.”2 For

commercial speech, by contrast, the Supreme Court has prescribed the four-prong

Central Hudson test to determine its constitutionality. This test asks initially (1)

whether the commercial speech at issue is protected by the First Amendment (that is,

whether it concerns a lawful activity and is not misleading) and (2) whether the

asserted governmental interest in restricting it is substantial. “If both inquiries yield

positive answers,” then to be constitutional the restriction must (3) “directly advance[

] the governmental interest asserted,” and (4) be “not more extensive than is necessary

to serve that interest.”3 In Board of Trustees of the State University of New York v.

Fox, the Supreme Court made it easier for the government to satisfy the fourth prong

of the Central Hudson test. It held that the fourth prong is not to be interpreted

“strictly” to require the legislature to use the least restrictive means available to

accomplish its purpose.4 Instead, the Court held, legislation regulating commercial

speech is to be upheld if there is a “‘fit’ between the legislature’s ends and the means

chosen to accomplish those ends,” — “a fit that is not necessarily perfect, but

reasonable . . . .”5 The Court, however, does “not equate this test with the less

rigorous obstacles of rational basis review.”6 In other words, although, to satisfy the

fourth prong, a restriction on commercial speech need not constitute the least

restrictive means to advance the asserted governmental interest, it must be more than

merely rational.

In 1996, in 44 Liquormart, Inc. v. Rhode Island, the Supreme Court increased

the protection that the Central Hudson test guarantees to commercial speech by

indicating that “when a State entirely prohibits the dissemination of truthful,

nonmisleading commercial messages for reasons unrelated to the preservation of a fair

1

Board of Trustees of the State University of New York v. Fox, 492 U.S. 469, 482 (1989)

(emphasis in original).

2

Sable Communications of California, Inc. v. Federal Communications Commission, 492

U.S. 115, 126 (1989).

3

Central Hudson Gas & Electric Corp. v. Public Service Commission of New York, 447 U.S.

557, 566 (1980). In Florida Bar v. Went For It, Inc., 515 U.S. 618 (1995), the Court referred

to the Central Hudson test as having three parts, and referred to its second, third, and fourth

prongs as, respectively, the first, second, and third. In 44 Liquormart, Inc. v. Rhode Island,

116 S. Ct. 1495, 1521 (1996), the Justices seemed to return to the traditional numbering.

4

Fox, supra note 1, at 476.

5

Id. at 480.

6

Florida Bar v. Went For It, Inc., supra note 3, at 632.

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bargaining process,” the restriction will be subject to a stricter review by the courts

than a regulation designed “to protect consumers from misleading, deceptive, or

aggressive sales practices.”7 The prohibition in 44 Liquormart was on advertising the

price of alcoholic beverages, not on all advertising of alcoholic beverages. Therefore,

when the Court referred to “entirely” prohibiting the dissemination of truthful,

nonmisleading commercial messages, it apparently included entirely prohibiting the

dissemination of any particular item of truthful, nonmisleading information.

We will now discuss the application of each of the four prongs of the Central

Hudson test to §§ 122-123, considering their provisions in general, rather than

considering each of their restrictions on tobacco advertising separately. Then we will

consider whether 44 Liquormart affects our general conclusion. Finally we will

consider the constitutionality of some of the specific restrictions.

Applying Central Hudson: First Prong

The first prong of the Central Hudson test asks whether the restricted speech

concerns a lawful activity and is not misleading. We will assume that the advertising

is not misleading, as if it is, it is already illegal under § 5 of the Federal Trade

Commission Act, 15 U.S.C. § 45, which prohibits “unfair or deceptive acts or

practices in or affecting commerce.” We will also assume that the advertisements

concern a lawful activity, even though the sale of tobacco products to minors is illegal

in every state.8 We will assume that the advertisements concern a lawful activity

because some of the restrictions in §§ 122-123 would affect tobacco advertisements

aimed at adults as well as at minors.

Applying Central Hudson: Second Prong

The second prong of the Central Hudson test asks whether the asserted

governmental interest in restricting the commercial speech in question is substantial.

The Supreme Court, in Posadas de Puerto Rico Associates v. Tourism Company of

Puerto Rico, held that a government’s “interest in the health, safety, and welfare of

its citizens constitutes a ‘substantial’ governmental interest.”9 Although Part VI of

the Court’s opinion in 44 Liquormart questioned some aspects of Posadas, this was

not one of them, and there seems no doubt that S. 1415 would satisfy the second

prong.

7

116 S. Ct. 1495, 1507 (1996). The nine Justices were unanimous in striking down the law,

which prohibited advertising the price of alcoholic beverages, but only parts of Justice

Stevens’ opinion for the Court were joined by a majority of Justices. The quotations above,

for example, are from Part IV of the Court’s opinion, which was joined by only Justices

Kennedy and Ginsburg besides Justice Stevens.

8

U.S. Department of Health and Human Services, Public Health Service, Centers for Disease

Control and Prevention, State Laws on Tobacco Control — United States, 1995.

9

478 U.S. 328, 341 (1986).

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Applying Central Hudson: Third Prong

In Posadas, the Supreme Court, applying the third prong of the Central Hudson

test, found reasonable the Puerto Rico legislature’s view that restricting advertising

would directly advance the asserted governmental interest by reducing the demand for

the product advertised (which, in this case, was gambling).10 The Court also cited

with approval a statement from an earlier case that the third prong of Central Hudson

is satisfied where the legislative judgment is “not manifestly unreasonable.”11

In subsequent cases, however, the Court has not deferred as readily to legislative

judgments that a restriction directly advances the asserted governmental interest. In

Edenfield v. Fane,12 for example, the Court struck down a Florida ban on solicitation

by certified public accountants, even though the Court had previously, in Ohralik v.

Ohio State Bar Association,13 upheld a ban on solicitation by attorneys. The Court

found that the government had substantial interests in the ban, including the

prevention of fraud, the protection of privacy, and the need to maintain CPA

independence and to guard against conflicts of interest. However, the Court found

no evidence that the ban directly advanced these interests, and noted, among other

things, that, “[u]nlike a lawyer, a CPA is not ‘a professional trained in the art of

persuasion,’” and “[t]he typical client of a CPA is far less susceptible to manipulation

than the young accident victim in Ohralik.”14

In Ibanez v. Florida Board of Accountancy, the Court held that the Florida

Board of Accountancy could not reprimand an accountant for truthfully referring to

her credentials as a Certified Public Accountant and a Certified Financial Planner in

her advertising and other communication with the public, such as her business cards

and stationery. The Court applied the Central Hudson test, noting that “the State

‘must demonstrate that the harms it recites are real and that its restriction will in fact

alleviate them to a material degree.’”15

In Rubin v. Coors Brewing Co., the Court struck down a federal statute, 27

U.S.C. § 205(e), that prohibits beer labels from displaying alcohol content unless state

law requires such disclosure.16 The Court found sufficiently substantial to satisfy the

second prong of the Central Hudson test the government’s interest in curbing

“strength wars” by beer brewers who might seek to compete for customers on the

basis of alcohol content. However, it concluded that the ban “cannot directly and

materially advance” this “interest because of the overall irrationality of the

10

Id. at 341-342.

11

Id. at 342, citing Metromedia, Inc. v. San Diego, 453 U.S. 490 (1981).

12

507 U.S. 761 (1993).

13

436 U.S. 447 (1978).

14

Edenfield, supra note 12, at 775.

15

512 U.S. 136, 143 (1994).

16

514 U.S. 476 (1995).

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Government’s regulatory scheme.”17 This irrationality is evidenced by the fact that

the ban does not apply to beer advertisements, and by the fact that the statute requires

the disclosure of alcohol content on the labels of wines and spirits.

Finally, in 44 Liquormart, the Court, in striking down a prohibition on

advertising the price of alcoholic beverages, found that Rhode Island had not met its

burden of showing that the “ban will significantly advance the State’s interest in

promoting temperance.”18 “[T]he State’s own showing,” the Court wrote, “reveals

that any connection between the ban and a significant change in alcohol consumption

would be purely fortuitous. . . . [A]ny conclusion that elimination of the ban would

significantly increase alcohol consumption would require us to engage in the sort of

‘speculation or conjecture’ that is an unacceptable means of demonstrating that a

restriction on commercial speech directly advances the State’s asserted interest.”19

Cases like Edenfield, Ibanez, Rubin, and 44 Liquormart indicate that, to satisfy

the third prong of the Central Hudson test, the government must present evidence to

support its claim that its restriction on commercial speech directly and materially

advances a substantial governmental interest. In Florida Bar v. Went For It, Inc., the

Court upheld a rule of the Florida Bar that prohibited personal injury lawyers from

sending targeted direct-mail solicitations to victims and their relatives for 30 days

following an accident or disaster.20 The Bar argued “that it has a substantial interest

in protecting the privacy and tranquility of personal injury victims and their loved ones

against intrusive, unsolicited contact by lawyers,”21 and the Court found that “[t]he

anecdotal record mustered by the Bar” to demonstrate that its rule would advance this

interest in a direct and material way was “noteworthy for its breadth and detail”; it

was not “mere speculation and conjecture.”22

When the Food and Drug Administration promulgated tobacco advertising

restrictions, it concluded “that tobacco advertising plays a concrete role in the

decision of minors to smoke, and that each specific restriction on this advertising that

it is adopting will contribute to limiting its effect and thus to protecting the health of

children and adolescents under the age of 18.”23 If this is true, then the advertising

restrictions would, in general, apparently satisfy the third prong of the Central

Hudson test. Of course, it is possible for a court to find some of the restrictions in S.

1415 constitutional but others unconstitutional.

17

Id. at 488.

18

116 S. Ct. at 1509.

19

Id. at 1510.

20

Florida Bar, supra note 3.

21

Id., 515 U.S. at 624.

22

Id. at 627.

23

61 Fed. Reg. 44,474 (1996). These regulations have not taken effect because a federal

court held that the FDA lacked the statutory authority to implement them. Coyne Beahm, Inc.

v. United States, 958 F. Supp. 1060 (M.D. N.C. 1997).

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The FDA, in connection with its regulations, wrote: “It is not necessary in

satisfying this prong of Central Hudson for the agency to prove conclusively that the

correlation [between advertising and minors’ smoking] in fact (empirically) exists, or

that the steps undertaken will completely solve the problem. . . . Rather, the agency

must show that the available evidence, expert opinion, surveys and studies provide

sufficient support for the inference that advertising does play a material role in

children’s tobacco use.”24 This seems accurate, given the Court’s acceptance of

anecdotal evidence (albeit anecdotal evidence “noteworthy for its breadth and detail”)

in Florida Bar v. Went For It, Inc., even though anecdotal evidence by itself cannot

conclusively prove general propositions.

In sum, it appears likely that the restrictions in S. 1415 would satisfy the third

prong if the government can present evidence that they will reduce the demand for

tobacco and thereby reduce the incidence of tobacco-related illnesses.

Applying Central Hudson: Fourth Prong

We now turn to the fourth and final requirement of the Central Hudson test —

that restrictions on commercial speech represent a reasonable “fit” between the

legislature’s ends and the means chosen to accomplish those ends. As noted above,

this prong requires that a restriction be more than merely rational, but not necessarily

the least restrictive means to advance the asserted governmental interest.25 In

Cincinnati v. Discovery Network, Inc., the Supreme Court struck down a Cincinnati

regulation that banned newsracks on public property if they distributed commercial

publications, but not if they distributed news publications.26 The Court found that the

asserted governmental interest in safety and esthetics was substantial, but that the

distinction between commercial and noncommercial speech “bears no relationship

whatsoever to the particular interests that the city has asserted.”27 The city, therefore,

did not establish “the ‘fit’ between its goals and its chosen means that is required by

our opinion in Fox.”28

In 44 Liquormart, the Court found it “perfectly obvious that alternative forms

of regulation would be more likely to achieve the State’s goal of promoting

temperance. As the State’s own expert conceded, higher prices can be maintained

either by direct regulation or by increased taxation. . . . Even educational campaigns

. . . might prove to be more effective.”29

The Court’s strong language in Cincinnati v. Discovery Network (“no

relationship whatsoever”) and in 44 Liquormart (“perfectly obvious”) suggests that

it found the regulations it struck down in those two cases to be particularly poorly

24

Id.

25

See, text accompanying note 6, supra.

26

507 U.S. 410 (1993)

27

Id. at 424 (emphasis in original).

28

Id. at 428.

29

44 Liquormart, supra note 7, 116 S. Ct. at 1510.

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thought-out. S. 1415, in general, does not appear similar in this respect. However,

the reasonableness of its restrictions must be considered individually, which we do

after we consider the effect of 44 Liquormart.

Effect of 44 Liquormart

As noted above, the Supreme Court in 44 Liquormart indicated that a total

prohibition on “the dissemination of truthful, nonmisleading commercial messages for

reasons unrelated to the preservation of a fair bargaining process” will be subject to

a stricter review by the courts than a regulation designed “to protect consumers from

misleading, deceptive, or aggressive sales practices.”30 Sections 122-123, like the

speech restriction struck down in 44 Liquormart, appears primarily intended to reduce

consumption of a dangerous product rather than to protect consumers from unfair

sales practices.31 Sections 122-123, however, unlike the speech restriction struck

down in 44 Liquormart, would not impose a total prohibition on any information

sought to be advertised.

In addition, the fact that §§ 122-123 are in part intended to protect minors may

help to distinguish it from the Rhode Island statute. A thread that appears to run

through 44 Liquormart is the Justices’ hostility to the paternalistic aspect of Rhode

Island’s ban. In Part IV of the Court’s opinion, Justice Stevens writes:

The First Amendment directs us to be especially skeptical of regulations

that seek to keep people in the dark for what the government perceives to

be their own good.32

In Part V, he adds that mere speculation as to whether “a restriction on

commercial speech directly advances the State’s asserted interest . . . certainly does

not suffice when the State takes aim at accurate commercial information for

paternalistic ends.”33 Justice Scalia, concurring, indicated that he “share[s] Justice

Stevens’ aversion toward paternalistic governmental policies that prevent men and

women from hearing facts that might not be good for them.”34 Justice Thomas, in his

30

Id. at 1507, quoted in the text accompanying note 7, supra.

31

The FDA argued that its restrictions were related to the bargaining process, as they “derive

from the fact that, at least as a matter of law, minors are not competent to use these products.”

61 Fed. Reg. 44,470. It would seem to strengthen the FDA’s case in this regard if we read

this instead to mean that minors are not competent to resist tobacco advertisements. This

argument would also seem available to S. 1415, but with less force because, though S. 1415

is intended to protect youth, its restrictions apply to more advertisements aimed at adults, and

so seem less designed to protect consumers from misleading, deceptive, or aggressive sales

practices. For example, the FDA’s restrictions would ban tobacco billboards within 1,000

feet of a school or playground, whereas S. 1415 would ban all outdoor tobacco billboards.

32

44 Liquormart, supra note 7, 116 S. Ct. at 1508.

33

Id. at 1510.

34

Id. at 1515 (Scalia, J., concurring).

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concurring opinion, refers to “the antipaternalistic premises of the First

Amendment.”35

Nevertheless, §§ 122-123 would limit advertisements aimed at adults as well as

at children. In the context of “indecent” material, the Supreme Court has reiterated

that the government may not “reduce the adult population . . . to reading only what

is fit for children.”36 Thus, for example, indecent material may not be banned from the

airwaves for 24 hours a day,37 and adults’ access to indecent material on the Internet

may not be precluded in order to protect children, at least if less restrictive means to

protect children are available.38 This principle may not apply as forcefully to

governmental restrictions of commercial speech, however, as adults’ access to

indecent material, unlike to commercial speech, receives full First Amendment

protection. Nevertheless, the Justices’ discomfort with the paternalism they perceived

in the Rhode Island statute suggests that, even if a commercial speech restriction

aimed at public health might otherwise pass the Central Hudson test, it might not if

it unduly restricts adults’ access to truthful, nonmisleading commercial messages. At

the same time, the Rhode Island statute totally restricted liquor price advertising,

whereas S. 1415 would not totally restrict tobacco advertising, and this distinction

could make a difference in a court's decision as to the constitutionality of S. 1415.

Prior to 44 Liquormart, the U.S. Court of Appeals for the Fourth Circuit, in two

cases, upheld Baltimore ordinances that prohibited tobacco and alcohol

advertisements on billboards, except in certain commercially and industrially zoned

areas of the city.39 Then, after 44 Liquormart, the Supreme Court vacated and

remanded both cases “for further consideration in light of 44 Liquormart . . . .”

35

Id. at 1517 (Thomas, J., concurring).

36

Bolger v. Youngs Drug Products, Inc., 463 U.S. 63, 73 (1983); Sable, supra note 2, 492

U.S. at 128.

37

Action for Children’s Television v. Federal Communications Commission, 932 F.2d 1504,

1509 (D.C. Cir. 1991), cert. denied, 503 U.S. 913 (1992).

38

Reno v. ACLU, 117 S. Ct. 2329 (1997). The Court wrote in that case:

In order to deny minors access to potentially harmful speech, the CDA

effectively suppresses a large amount of speech that adults have a

constitutional right to receive and to address to one another. That

burden on adult speech is unacceptable if less restrictive alternatives

would be at least as effective in achieving the legitimate purpose that

the statute was enacted to serve. . . . As we have explained, the

Government may not “reduc[e] the adult population . . . to . . . only

what is fit for children.”

Id. at 2346. There is a tension between the second and third quoted sentences with which the

Court did not deal: if there are no less restrictive alternatives available, then may the

government reduce the adult population to only what is fit for children?

39

Penn Advertising of Baltimore, Inc. v. Mayor and City Council of Baltimore, 63 F.3d 1318

(4th Cir. 1995), vacated and remanded, 116 S. Ct. 2575 (1996); Anheuser-Busch, Inc. v.

Schmoke, 63 F.3d 1305 (4th Cir. 1995), vacated and remanded, 116 S. Ct. 1821 (1996).

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Next, the Fourth Circuit, after further consideration in light of 44 Liquormart,

readopted its previous decisions in both cases, and the Supreme Court subsequently

declined to review the cases.40 In Penn Advertising, the tobacco advertising case, the

court said simply that it was readopting its previous decision for the reasons it gave

in its opinion issued the same day in Anheuser-Busch, the alcoholic beverage

advertising case. In that case, the court wrote that, in its previous decision,

we recognized the reasonableness of Baltimore City’s legislative finding

that there is a “definite correlation between alcoholic beverage advertising

and underage drinking.” We also concluded that the regulation of

commercial speech is not more extensive than necessary to serve the

governmental interest. Recognizing that in the regulation of commercial

speech there is some latitude in the “fit” between the regulation and the

objective, we concluded that “no less restrictive means may be available to

advance the government’s interest.” While we acknowledged that the

geographical limitation on outdoor advertising may also reduce the

opportunities for adults to receive the information, we recognize that there

were numerous other means of advertising to adults that did not subject the

children to 'involuntary and unavoidable solicitation [while] . . . walking to

school or playing in their neighborhood.' . . .

In 44 Liquormart, by contrast, the State prohibited all advertising

throughout Rhode Island, “in any manner whatsoever,” of the price of

alcoholic beverages except for price tags or signs displayed with the

beverages and not visible from the street. . . . While Rhode Island’s blanket

ban on price advertising failed Central Hudson scrutiny, Baltimore’s

attempt to zone outdoor alcoholic beverage advertising into appropriate

areas survived our “close look” at the legislature’s means of accomplishing

its objective . . . . Baltimore’s ordinance expressly targets persons who

cannot be legal users of alcoholic beverages, not legal users as in Rhode

Island. More significantly, Baltimore does not ban outdoor advertising of

alcoholic beverages outright but merely restricts the time, place, and

manner of such advertisements. And Baltimore’s ordinance does not

foreclose the plethora of newspaper, magazine, radio, television, direct

mail, Internet, and other media available to Anheuser-Busch and its

competitors.41

The pertinent question, it seems, is whether the restrictions that S. 1415 would

impose would be more like those struck down in 44 Liquormart or those upheld in

the Fourth Circuit cases. Like the ordinances the Fourth Circuit upheld, S. 1415

would not impose a total ban on any information sought to be advertised. However,

S. 1415 would not focus as narrowly on advertisements accessible to children as did

the ordinances the Fourth Circuit upheld. It is not the case with S. 1415, as it was

with the Baltimore ordinances, that it would “not ban outdoor advertising of alcoholic

40

Penn Advertising v. Mayor and City Council of Baltimore, 101 F.3d 332 (4th Cir. 1996),

cert. denied, 117 S. Ct. 1569 (1997); Anheuser-Busch v. Schmoke, 101 F.3d 325 (4th Cir.

1996), cert. denied, 117 S. Ct. 1569 (1997).

41

101 F.3d at 327-329 (citations omitted).

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beverages outright but merely restricts the time, place, and manner of such advertisements.” But, like Baltimore’s alcoholic beverage ordinance, it would not, except

with respect to the Internet, foreclose the “plethora” of other media on which tobacco

products may be advertised. At the same time, however, federal law already reduces

the size of this “plethora,” as it bans advertisements for cigarettes, little cigars, and

smokeless tobacco “on any medium of electronic communication subject to the

jurisdiction of the Federal Communications Commission.”42 This would be a factor

that could be cited to argue that S. 1415 would have a more restrictive effect on

adults than might appear from its face. In addition, S. 1415 would restrict the content

of advertisements in media in which it would continue to permit advertisements,

which is something the Baltimore ordinances do not do.

In conclusion, it appears that the degree of restrictiveness of S. 1415 would lie

somewhere between that of the provision struck down in 44 Liquormart and those

upheld in the Fourth Circuit cases. Some of the prohibitions of S. 1415 would seem

to include the sort of paternalism to which the Court objected in 44 Liquormart, but

others of its prohibitions seem more narrowly focused on protecting minors. We will

distinguish among these in the next section of this memorandum.

First, however, we offer a more general comment. The decision in 44

Liquormart might, on the one hand, be viewed as part of a trend on the Court’s part

to increase the First Amendment protection it accords to commercial speech. If this

is in fact a trend, then the likelihood of its striking down substantial portions of S.

1415 would increase. On the other hand, the Court in 44 Liquormart, as noted

above, seemed to view the Rhode Island statute in question as particularly poorly

thought-out, with the Court commenting “that any connection between the ban and

a significant change in alcohol consumption would be purely fortuitous,” and that “[i]t

is perfectly obvious that alternative forms of speech would be more likely to achieve

the State’s goal of promoting temperance.” Although S. 1415 would restrict more

speech than the Baltimore ordinances do, it does not appear poorly thought-out in the

manner that the Supreme Court seemed to think the Rhode Island statute in 44

Liquormart was. It is also possible that a stronger link can be demonstrated between

the restrictions in S. 1415 and "a significant change in [tobacco] consumption." But

now we must examine some of the restrictions in S. 1415 individually, as that is how

they will stand or fall.

Analysis of S. 1415's Restrictions

To do this necessitates applying the four prongs of the Central Hudson test.

However, we will take as a given that all the restrictions in S. 1415 would pass the

first prong, as tobacco advertising is legal and we will presume it is not misleading.

We will also assume that all the restrictions would pass the second prong, as

restricting tobacco advertising would serve the substantial governmental interest of

promoting public health. In addition, to the extent that the restrictions would reduce

children’s exposure to tobacco advertisements, we will assume that they would

directly and materially advance the governmental interest in reducing underage

smoking. The constitutionality of most of the restrictions, therefore, will apparently

42

15 U.S.C. §§ 1335, 4402.

CRS-11

turn on the fourth prong, which asks whether, for each restriction, there is a

reasonable “fit” between the government’s means and ends. The restriction must be

more than merely rational, but need not necessarily be the least restrictive means

available.

The prohibition of outdoor advertising might be subject to challenge. If it were

limited, as the Baltimore ordinance is, to outdoor advertising within 1,000 feet of a

school or playground, then there would be a precedent for its constitutionality. The

restriction as it stands clearly would reduce children’s exposure to tobacco

advertising, so it would seem likely to satisfy the third prong of Central Hudson. But

it would also reduce adults' exposure to tobacco advertising, so the government

would apparently have to demonstrate that a restriction limited as the Baltimore

ordinance is would leave minors overly exposed to tobacco advertising, and would

not overly restrict adults’ access to tobacco advertising.

The prohibition of advertising in enclosed stadia may also be challenged,

because it does not exempt events or activities that children are unlikely to attend.

The government could advance its aim of protecting children without banning

advertisements at performances from which children are excluded because they are

X-rated (though, admittedly, such performances usually occur in theaters or bars

rather than in stadia). There are also performances from which children are not

excluded, but which relatively few children attend, such as classical music concerts

(other than those designed for children). If few children typically attend a particular

type of performance, then one might challenge this restriction on the ground that it

would not materially advance the governmental interest in protecting children, and

would therefore fail the third prong. Or one might challenge it on the ground that it

would unreasonably interfere with the rights of adults, and would therefore fail the

fourth prong. These arguments would apply on the assumption that the

advertisements in question could be easily taken up and down; if they were relatively

permanent, then there would be a stronger argument that banning them would be

constitutional.

The prohibition of advertising or labeling with a human or animal image or

cartoon character would seem to face similar problems. If the government could

present evidence that children respond particularly to human images and cartoon

characters, then this restriction would apparently be constitutional to the extent that

it would not overly restrict adults’ access to the proscribed pictures.43 It would,

however, apparently raise constitutional questions to the extent that it would apply

to material unavailable to children, and perhaps also to the extent that it would apply

to material with an intellectual content that would attract few minors.

The requirement of disclaimers that words such as "light" or "low tar" describing

the product do not render the product less hazardous than any other tobacco product,

as well as of other disclosures not noted in the summary of § 122 at the beginning of

this report, would apparently be constitutional. This is because the Supreme Court

43

Pictures as well as words are protected by the First Amendment. See, Manuel Enterprises

v. Day, 370 U.S. 478 (1962).

CRS-12

has held that an advertiser's "constitutionally protected interest in not providing any

particular factual information in his advertising is minimal."44

The requirement that advertising and labeling be reviewed by the Secretary of

HHS before it is first used would apparently be constitutional if it is designed solely

to enable the Secretary to advise the tobacco company as to whether the advertising

and labeling complies with the law, or to seek a court injunction against such

advertising if appropriate.

The prohibition of advertising on the Internet “unless such an advertisement is

inaccessible in or from the United States to all individuals under the age of 18" may

be problematic because the degree of censorship it would impose on adults might

cause a court to find that it does not represent a reasonable “fit” under Central

Hudson’s fourth prong. This provision would apparently, in effect, prohibit tobacco

advertising on the Internet except for the relatively small percentage of Web sites

available to adults only, by subscription only. As discussed above, the Supreme

Court, in Reno v. ACLU, held a comparable restriction on indecent material

unconstitutional, although the fact that indecent material receives a higher level of

First Amendment protection than commercial speech increases the possibility that the

Supreme Court would uphold this provision of S. 1415.45

The prohibition of advertising with other than black text on white background

except at locations where individuals under 18 are not permitted and in publications

whose readers under the age of 18 constitute 15 percent or less of the total readership

appears more likely to be found constitutional than some of the provisions that would

more greatly restrict advertising aimed at adults.

As noted, there appears to be an inconsistency in the provision that would

prohibit payments to be made to ensure that "a logo, symbol, motto, selling message,

recognizable color or pattern of colors, or any other indicia of product identification"

appear in a movie, program, or video game. Section 122(a)(2) prohibits such

payments outright, whereas section 122(a)(3) apparently prohibits them only in the

case of "print or film media that appeals to individuals under the age of 18 years or

through a live performance by an entertainment artist that appeals to such

individuals." Thus, the restriction on advertising in programs or video games would

not be limited to those that appeal to minors, while the restriction as to print media

and to live performances would be limited in that respect. (The word "programs"

presumably means television programs rather than printed programs that are

distributed at live performances, but this might be clarified.) However, the restriction

on advertising in "movies" would be restricted to those that appeal to minors, while

the restrictions as to "films" would not be, which seems inconsistent.

The above restrictions that are not limited to those that appeal to minors may be

subject to challenge on the ground that they unduly restrict adults' access to tobacco

44

Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626, 651 (1985) (emphasis in

original).

45

See, text accompanying note 38, supra.

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advertisements. Even those that are limited, however, may face challenge because of

the possible vagueness of the word "appeals."

The prohibition of "a logo, symbol, motto, selling message, recognizable color

or pattern of colors, or any other indicia . . . identifiable with a tobacco product" to

be used on non-tobacco products would restrict a particular form of tobacco

advertising. As such, it might raise constitutional questions because it would not be

limited to non-tobacco products to which minors are exposed to a significant degree.

Finally, section 123's limits on point-of-sale advertising at any location in which

an individual under 18 is permitted would seem constitutional because they are

directed to minors and do not totally restrict advertising aimed at adults.

In summary, it appears that the constitutionality of S. 1415's restrictions will

likely turn on whether they represent a reasonable "fit" between the government's

means and ends. In Reno v. ACLU, in striking down restrictions on indecent material,

the Supreme Court reiterated that the government may not "reduce the adult

population . . . to reading only what is fit for children." However, Reno v. ACLU did

not involve commercial speech, which receives less protection under the First

Amendment than other speech. Consequently, the courts might find that S. 1415's

restrictions, even though they would limit adults' access to tobacco advertising, would

represent a reasonable fit between the government's means and its end of reducing

underage smoking. The fact that S. 1415's restrictions would not be as encompassing

as the restrictions on liquor price advertising that the Supreme Court struck down in

44 Liquormart, and would allow some tobacco advertising to continue, might increase

the likelihood of the restrictions' being upheld. However, this is an area of

constitutional law about which it is difficult to make predictions.

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