How NOT to Win the Critical Fight Against Underage Drinking: Fabrications, Falsehoods...

How NOT to Win the Critical Fight Against Underage Drinking: Fabrications,
Falsehoods and Fiction
Marin's Bogus 'Alert' Continues Practice of Misleading the Public

BALTIMORE, March 31 /PRNewswire-FirstCall/ -- Diageo announced today its
disappointment in seeing yet another setback in the serious issue of combating
underage drinking. Last week, the Marin Institute issued a so-called "Action
Alert" to the Maryland legislature that was replete with inaccuracies and
mis- and disinformation about flavored malt beverages (FMBs). The "Alert"
addresses a Maryland House bill (HB 879) that seeks to clarify the state's
alignment with the federal standard when determining what constitutes a beer.
This sound legislative policy maintains the regulatory status quo in the state
and puts Maryland in line with the federal standard that is very well thought
out and meticulously crafted only after significant industry research and an
arduous rulemaking process. Marin's specious "Action Alert" not only served to
perpetuate dangerous myths about a logical, common sense bill, but also made a
mockery of the federal rulemaking process that established the well-founded
regulation.
"Every time someone engages in inaccurate grandstanding for political or
other reasons, the critical battle against underage drinking takes a step
backwards," said Guy L. Smith, Executive Vice President, Diageo North America.
He continued, "The Marin Institute is letting inaccuracies guide its thinking
and, yet again, fails to offer any viable solutions to combating underage
drinking. Underage drinking is a serious problem and we have to address it in
a serious way. And the only way to do that is to base our policy on fact and
research, not myths and purposeful deceptions."
FMBs -- also known as flavored beer -- should be taxed and sold just like
traditional and other craft beers. These products have similar alcohol content
as traditional beer, the majority of their alcohol is derived from malt
according to the federal standard and, like all Diageo products, are strictly
marketed to adults age 21 and older.
"The Marin 'Alert' perpetuates myths that are not only wrong but are
counter productive," continued Smith.
The press release issued last week makes many claims that are misleading
at best, and incorrect at worst. Some examples:
CLAIM: FMBs are "youth targeted ... "
REALITY: False. The Federal Trade Commission conducted a thorough,
months-long investigation on FMBs specifically and found "no evidence of
targeting underage consumers in the flavored beer market." (FTC, Alcohol
Marketing and Advertising, A Report to Congress, p. I, September 2003.)

CLAIM: Accuses alcohol manufacturers of "deception and de facto tax
evasion."
REALITY: False. Diageo and other beverage alcohol manufactures abide by
the Maryland state law that complies with the accepted federal regulation.
There has been NO deception and NO tax evasion. In fact, the Marin
Institute is proposing a giant tax hike that would unfairly tax adult
consumers who legally purchase these products. The true deception here is
Marin's claim that increasing taxes will effectively address the important
issue of underage drinking.

CLAIM: Taxing FMBs at a higher rate and raising the price will take it
out of the reach of underage drinkers.
REALITY: False. The fact is that 65% of underage drinkers get alcohol from
adults they know. To effectively combat underage drinking, we need to
demand that adults take responsibility for keeping out alcohol out of the
hands of underage drinkers and more effectively punish those who don't.
Higher taxes are not the answer.

Smith concluded, "Any way you look at this it's just one more thinly
veiled tax hike that will hurt not only responsible consumers, but also the
thousands of Maryland businesses that would no longer be able to sell FMBs if
the state fails to regulate them as what they are: Beer."
About Diageo
Diageo (Dee-AH-Gee-O) is the world's leading premium drinks business with
an outstanding collection of beverage alcohol brands across spirits, wines,
and beer categories. These brands include Johnnie Walker, Guinness, Smirnoff,
J&B, Baileys, Cuervo, Tanqueray, Captain Morgan, Crown Royal, Beaulieu
Vineyard and Sterling Vineyards wines.
Diageo is a global company, trading in more than 180 countries around the
world. The company is listed on both the New York Stock Exchange (DEO) and the
London Stock Exchange (DGE). For more information about Diageo, its people,
brands, and performance, visit us at http://www.diageo.com.
Celebrating life, every day, everywhere, responsibly.
SOURCE Diageo

Rachel Rosenblatt, of FD, +1-212-850-5697, for Diageo