Providence, R.I., Coupon and Promotion Ban Appeal Update

Thomas A. Briant, NATO Executive Director

Last year, a federal lawsuit was filed against the City of Providence, R.I., seeking to overturn two tobacco-related ordinances. One of the ordinances bans adult consumers from redeeming tobacco product coupons and also prohibits retailers from offering certain promotionally priced tobacco products, such as "buy-one, get-one free" offers. The second ordinance bans the sale of virtually all flavored cigars, smokeless tobacco, and pipe tobacco products in the city.

The lawsuit was filed by NATO, the Cigar Association of America Inc. (CAA), along with Lorillard Tobacco Co., R.J. Reynolds Tobacco Co., American Snuff Co., Philip Morris USA Inc., U.S. Smokeless Tobacco Manufacturing Co. LLC, U.S. Smokeless Tobacco Brands Inc. and John Middleton Co. Last December, the federal district court judge hearing the case issued a ruling upholding both of the ordinances.

In response, NATO and the other plaintiffs appealed the federal district court ruling to the U.S. Court of Appeals for the First Circuit. With the appellate briefing process nearly completed, an oral argument hearing before a panel of First Circuit appeals court judges should be scheduled for late summer or early fall of this year.

The decision by the appeals court will have a significant impact of the ability of retailers to accept coupons, offer promotionally priced tobacco products, and sell certain flavored tobacco products. Some towns in Massachusetts have adopted similar bans on coupon redemption. If the Providence ordinance is struck down by the First Circuit appeals court, then these local Massachusetts ordinances will need to be revisited and revised to conform to the court ruling.

One of the main claims in the lawsuit is that the ban on accepting tobacco product coupons and selling promotionally priced tobacco products as well as the prohibition on the sale of flavored tobacco products are not only an unconstitutional violation of both the U.S. Constitution and the Rhode Island Constitution, but are also pre-empted by federal laws regulating tobacco products.

Specifically, the ordinance banning coupons and promotional products is unconstitutional because it limits the ability of retailers and manufacturers to communicate tobacco product prices to adult consumers and is pre-empted by federal law because the ordinance attempts to regulate the advertising and promotion of cigarettes. Also, the ordinance violates the Rhode Island Constitution because it improperly attempts to regulate tobacco retailers, an authority which is reserved exclusively to the state.

The second ordinance, which bans the sale of certain flavored tobacco products, is also unconstitutional because it severely limits how retailers and manufacturers may describe the taste or aroma of their tobacco products to consumers. The right of free speech under the First Amendment to the U.S. Constitution extends to commercial speech that includes product descriptions in advertising. This right is infringed by the inability of retailers to even offer customers the opportunity to purchase legal tobacco products. In addition, as with the first ordinance, this ordinance violates the Rhode Island Constitution by adopting licensing requirements that are the exclusive province of the state.

NATO-CSP Tobacco E-News will publish updates as this litigation continues.