(Adds Altria comment, Reynolds and Lorillard not immediately
available for comment)
By Jonathan Stempel
NEW YORK, June 18 A federal judge said on
Wednesday New York City may prevent retailers from offering
discounts on cigarettes and other tobacco products, rejecting an
industry effort to halt enforcement of a law designed to curb
U.S. District Judge Thomas Griesa in Manhattan said the city
may block stores from selling the products at below list price,
whether by running sales, redeeming coupons, offering bulk
discounts or providing free lighters or other non-tobacco
products with purchases.
Industry trade groups, as well as cigarette makers,
including Philip Morris parent Altria Group Inc, Reynolds
American Inc and Lorillard Inc, complained that
the limits violated their free speech rights and were pre-empted
by other federal and state laws.
The limits on discounts were part of a sweeping law signed
last November by former Mayor Michael Bloomberg as part of an
effort to dissuade people from smoking.
Other changes included raising the minimum legal age to buy
tobacco to 21 from 18, setting a minimum $10.50 price for a pack
of cigarettes, boosting penalties for illegal tobacco sales and
increasing enforcement against non-payment of excise taxes.
In upholding the limits on discounts, Griesa said pricing
restrictions "designed to discourage consumption of a
potentially harmful product" were constitutional so long as
retailers could still provide "truthful, non-misleading
information" to consumers.
"The ordinance only regulates an economic transaction - the
sale of tobacco products below the listed price," he wrote. "It
does not restrict the dissemination of pricing information and
thus, it does not violate the First Amendment."
Altria spokesman Brian May said: "We disagree with the
court's decision, and are considering our appellate options."
Spokesmen for Reynolds American and Lorillard, as well as
lawyers for both companies, did not immediately respond to
requests for comment.
"This is a huge victory for the city's comprehensive efforts
to reduce tobacco usage," Nicholas Ciappetta, a senior lawyer
for the city, said in a statement.
Bloomberg's more than decade-old campaign to ban smoking in
various public and private places and to discourage New Yorkers
from smoking altogether has become a blueprint for other cities.
The City Council has estimated that the enacted changes have
helped reduce smoking rates in the city by nearly one-third for
adults and roughly one-half for children.
Bloomberg left office 5-1/2 months ago, after serving 12
years as mayor.
The case is National Association of Tobacco Outlets Inc et
al v. City of New York et al, U.S. District Court, Southern
District of New York, No. 14-00577.
(Reporting by Jonathan Stempel in New York; Editing by Dan