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46 UNITED STATES OF AMERICA BE,FORE FEDERAL TRADF COMMISSION In the Matter of P. LORILLARD COMPANY, INC. DOCKET No. 4922. SUPPLEMENTAL STIPULATION AS TO THE FACTS IT IS' HEREEY STIPULATED AND AGREED by and between Richard P. Whiteley„ Assistant Chief Counsel for the Federal Trade Commission, and respondent P. Lorililard Company (erroneously named4 in the complaint herein as P. Lorillard Company, Inc.) that, subject to the approval of the Fed'eral Trade Commission, the following stipulation of facts, including inferences the Commission may draw from the stipulated facts, may be made a part of the record herein, supplementing the stipulation as to the facts in this matter entered into be"veen W. T. Kelley, Chief Counsel for the Federal Trade Commis- sion, and the respondent on N'ovember 16; 1944,, and approved~ November 20, 1944, and supplemental also to the stipulation- entered into between Richard P. Whiteley, Assistant Chief Counsel for the Federal Trade Commission, and thc respondent on January 16, 1945, and approved by the Commission on January 17, 1945; and IT IS HEREBY FURTHER STIPULATED AND AGREED by and between Richard P. Whiteley, Assistant Chief Counsel for the Federal Trade Commission, and t1le respondent that, subject to the approval of the Federal Trade Commission, the said Federal Trade Commission may proceed upon the complaint.

~f herein, the answer of respondent, the testimony and evidence, the stipulation of facts entered into November 16, 1944, in- cluding inferences the Commission may draw from the stip- ulatedi facts, approved by the said Commission on November 20, 19441, and a part of the record herein, the stipulation entered' into before the Trial Examiner on~ December 4, 1944, page 196 of the transcript of the hearing that day, and the aforesaid stipulation dated January 16, 1945, and~ approved by the Commission January 17, 1945, and upon this stipulation, to make its report stating its findings as to the facts and its con- clusion based thereon and enter its order disposing of the proceeding without the presentation of argument or the filing of briefs. SUPPLEMENTAL STATEMENT OF FACTS PARAGRAPH ONF : The Federal Trade Commission is able to produce competent and qualified witnesses who if sworn as witnesses in this proceeding would testify to the follbwing, which the Federal Trade Commission may -=ider-wiiie- same force and effect as if such witnesses had been duliy sworn and had so testified. In truth and in fact the content of nicotine, or tarry matter, and of other substances, irritating to the throat and nasal passages of the smoker and otherwise harmful, varies con- tinually in respondent's cigarettes and the smoke therefrom, as they are offered for sale to the general public; and the relative content of nicotine, of tarry matter and of such substances in ' respondent's cigarettes as compared with that of competing brands of cigarettes likewise varies continually. The number of variable factors involved in the growing of tobacco for cigarettes, in the blending and processing of such tobacco into cigarettes, and in the packing„ handling and distribution of such cigarettes to the consumer make it impossible for respondent or any of its competitors to produce and market the large volume of

48' cigarettes, which they respectively sell, with a standard or constant content of nicotine, tarry matter and other harmful substances. Among these variable factors are differences in weather conditions during the tobacco-growing season in differ- ent localities in which tobacco of the same variety is grown; differences in such weather conditions from year to year, differences in the soil in which cigarette tobacco is grown and in the cultyvation~ and fertilization thereof; variation in the mixing and blending of the varieties of tobacco incorporated in the cigarettes; variations in the changes brought about in cigarette tobacco in the processing thereof; deviations in the density with which the tobacco is packed in cigarettes and in the weight of the, cigarettes themselves; variations in methods of handling, and! distribution of cigarettesandi changes and differences in climatic conditions affecting cigarettes after they leave the factory where nrade: In truth and in fact, there is no practicable method! whereby the content of nscotine, tarry mat- ter and other harmful substances in the general run of re- spondent's cigarettes as they reach the consumer or in those of its competitors, or in the smoke therefrom, can be ascertained with any degree of accuracy for any appreciablelength of time. Any test which may be made to determine such content must as a practical matter, be limited to a few samples, infinitesimal in number as compared with the total number of such cigarettes on sale at any one time, and the results obtainable from any such test are indicative of nothing more than the facts sought to be ascertained as of the particular time and place of the initiation of the test. In truth and in fact,, the differences in the content of nicotine, tarry matter and other harmful sub- stances to be found in respondent's cigarettes as compared with those of competing cigarettes, and such differences among the cigarettes of such competitors, are so minute as to be insignificant and undetectable from the! standpoint of the effect which such substances have on~ the smoker of respondent's 1'J U1

49 cigarettes as compared to that experienced by the smoker of competing brands. PARAGRAPH Two: During the period of time mentioned in the complaint, in the course and conduct! of its business described in the complaint, and for the purpose of aiding and promoting the sale by it in the commerce therein described,, of its "Old Gold" brand of cigarettes, the respondent disseminated and caused to be disseminated by United States mails, in maga- zine of nation-wide circulation, in newspapers of interstate cir- culation, by local radio broadcasts and by nation-wide hookups of broadcasts and by other means in commerce, advertisements, samples of which appear in the record as exhibits and which relate to the nicotine and irritating tar and resin content of "Old Gold" cigarettes and of certain competing brands of cigarettes, and advertisements representing, directly and by implication, (a) that "Old Gold" cigarettes are made of prize crop tobacco; (b) that the tobaccos in such cigarettes are the finest that money can buy. PARACRAPH THxEn: In fact, during tlie period~ of-time described in the complaint all of the tobacco contained in "OU Gold" cigarettes was not prize crop tobacco nor was all of such tobacco the finest that money can buy. PARAGRAPH FouR: The aforesaid advertisements, state- ments and represent'ations have had the capacity and tendency to mislead'i and may have misled some of the purchasing public, into the beliefs (a) that of the seven leading brands of ciga- rettes "Old Gold" cigarettes are lowest in nicotine content and are lowest in throat irritating tars and resins; (b) that, "Old Gold" cigarettes contain only prize crop tobacco; (c) that all of the tobaccos in such cigarettes are the finest thati money can buy; and have had the capacity and tendency to cause said

purchasing public to purchase "Old Gold" cigarettes in such erroneous beliefs. FEDERAL TRt1DE' COMMISSION By ...................... Richard P. Whiteley, Assistant Chief Counsel. P. L,ORILLAItD COMPANY By ...................... Dated~ this day of A. D., 1945. APPROVED: FEDE.RAL TRADE COMMISSION By ..................... Otis B. Johnson, Secretary.