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The People of the State of Illinois v. R.J. Reynolds Tobacco Company

June 30, 2011

THE PEOPLE OF THE STATE OF ILLINOIS,
PLAINTIFF-APPELLANT,
v.
R.J. REYNOLDS TOBACCO COMPANY,
DEFENDANT-APPELLEE
(PHILIP MORRIS, INC.; AMERICAN TOBACCO COMPANY, INC.; BROWN AND WILLIAMSON TOBACCO CORPORATION; LIGGETT & MYERS, INC.; LORILLARD TOBACCO COMPANY, ) INC.; UNITED STATES TOBACCO COMPANY; B.A.T. INDUSTRIES, P.L.C.; BRITISH AMERICAN TOBACCO COMPANY, LTD.; HILL AND KNOWLTON, INC.; THE COUNCIL FOR TOBACCO RESEARCH-U.S.A.; AND TOBACCO INSTITUTE, INC., DEFENDANTS).



Appeal from the Circuit Court of Cook County No. 96 L 13146 Honorable Dennis J. Burke, Judge Presiding.

The opinion of the court was delivered by: Justice Sterba

JUSTICE STERBA delivered the judgment of the court, with opinion.

Presiding Justice Lavin and Justice Pucinski concurred in the judgment and opinion.

OPINION

This appeal arises from R.J. Reynolds Tobacco Company's (Reynolds) advertisements in Rolling Stone magazine's Fortieth Anniversary issue and images Reynolds used in its "Camel Farm" promotional campaign. The State of Illinois filed a motion for a rule to show cause why Reynolds should not be held in contempt for violating a consent decree when Reynolds used a "cartoon" in its "Camel Farm" campaign. The State contends that the circuit court erred when it ruled that Reynolds did not use a "cartoon" because the images in the "Camel Farm" advertisements did not portray superhero-like powers. The State also claims that Reynolds violated the consent decree when Rolling Stoneused a "cartoon" in its editorial, which was located in close proximity to Reynolds' advertisement in the magazine. The State contends that Reynolds had an affirmative duty to inform Rolling Stone that it could not use a "cartoon" in its publication near Reynolds' advertisements. For the reasons that follow, we affirm in part and reverse in part and remand the cause for further proceedings.

BACKGROUND

Reynolds is a leading manufacturer of tobacco products. In November 1996, the State of Illinois along with 39 other states sued Reynolds and other tobacco manufacturers seeking damages and injunctive relief alleging that the tobacco manufacturers intentionally targeted minors through their marketing and promotional campaigns and that they concealed from the public information regarding the harmful health impacts of smoking and the addictiveness of nicotine. On November 23, 1998, Reynolds executed a master settlement agreement (MSA) with designated State officials from the 40 states that initiated the litigation against it. The MSA included a "Prohibition on Youth Targeting" provision, which prohibited the promotion or marketing of tobacco products to individuals under the age of 18. The MSA also prohibited Reynolds from the "use or cause to be used any Cartoon in the advertising, promoting, packaging or labeling of Tobacco Products." The MSA in section II, subsection (l), defines the term "cartoon" as:

"any drawing or other depiction of an object, person, animal, creature or any similar caricature that satisfies any of the following criteria:

(1) the use of comically exaggerated features;

(2) the attribution of human characteristics to animals, plants or other objects, or the similar use of anthropomorphic technique; or

(3) the attribution of unnatural or extrahuman abilities, such as imperviousness to pain or injury, X-ray vision, tunneling at very high speeds or transformation.

The term 'Cartoon' includes 'Joe Camel,' but does not include any drawing or other depiction that on July 1, 1998, was in use in any State in any Participating Manufacturer's corporate logo or in any Participating Manufacturer's Tobacco Product packaging."

Reynolds and the State executed a consent decree adopting the MSA's provisions, including the prohibition on the use of "cartoons" and the definition of a "cartoon." On December 8, 1998, the circuit court approved and entered the consent decree and final judgment. The circuit court retained jurisdiction to implement and enforce the consent decree.

Reynolds released a new promotional campaign in 2006 called the "Camel Farm," which was created to show Reynolds' support of independent music and record labels. As part of the "Camel Farm" campaign, Reynolds sponsored concerts, created a "Camel Farm" website, sent direct mailings, and placed advertisements in print media, including Rolling Stone's Fortieth Anniversary issue published on November 15, 2007.

Reynolds' advertisement in Rolling Stone was entitled "the FARM [F]REE RANGE MUSIC." "COMMITTED TO SUPPORTING & PROMOTING INDEPENDENT LABELS" was printed in the advertisement. "THE BEST MUSIC RISES FROM THE UNDERGROUND" was stated in a banner. Beneath the banner in a box was the following language:

"The world of independent music is constantly changing.

New styles and sounds emerge daily. That's why we're bringing you The FARM. A collaboration between Camel and independent artists and record labels. It's our way of supporting these innovators as they rise up to bring their sounds to the surface. We give them more opportunities to be heard through online music and countless events across the nation."

The images in the "Camel Farm" advertisement focused primarily on a music and entertainment theme by displaying radios and speakers rising from the grass on top of flower stems, film reels as tires on a tractor, a record player placed on top of a tractor and a radio bearing propellers flying through the sky. The images were set in a green grassy pasture meeting a serene blue sky. The images also created a retrofeel because the tractor, radios and speakers looked old-fashioned.

Reynolds' advertisement in Rolling Stone was a "gatefold" advertisement that encompassed four pages, including a front page, two pages that folded inward and met in the middle and a back page. To access a Rolling Stone editorial, a reader had to open and unfold outward both of Reynolds' folded pages, one of which opened outward to the right and the other opened outward to the left. Rolling Stone's editorial encompassed five pages, four of which were on the reverse side of Reynolds' "gatefold" advertisement. Rolling Stone's editorial was entitled "Indie Rock Universe" and consisted of hand-drawn cartoon images and captions, such as "Angry Red Plant - Fight the Power Against Me!," "The Bearded Men of Space Station Eleven - The final frontier of awesome facial hair," and "The Bearded Ladies of Space Station Eleven - She came from Planet Claire - or maybe she's just kind of weird." Reynolds did not create the images in Rolling Stone's editorial.

The images in a video created by Reynolds and shown at concerts in Chicago contained images of farm animals, a woman with numerous tattoos and blue hair, a woman with bright red hair, a radio with affixed propellers flying across the screen and a tractor with film reels for tires and emitting musical notes from a record player placed on top of it moving across the screen. Reynolds also created a website that was found at http://www.thefarmmusic.com. The website contained ...


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