Tobacco Documents Online

M.J. MATTHEWS PHILIP MORRIS USA MANAGER CONCORD NC

CONTACT: SINIKKA SARRO (212) 880-3454 FAX No. (212) 907-5739 L I MONDAY, NOVEMBER 13, 1995 TODAY'S TOPICS TOBACCO (Pgs. 2-30) •CBS/PM vs. ABC/Litigation •FDA/Advertising/Youth Smoking • Smoking/Health/Lobbying •Smoking Bans/Smokers' Rights • Environment/International •Marlboro Unlimited/Taxes •Great American Smokeout CORPORATE/FINANCIAL (Pgs. 31-39) •PM/Advertising Spending/Top 200 •Tobacco Stocks/PM/Investing •Competitor News FOOD (Pgs. 40-42) •FDA/Food Lion vs. ABC •Kraft/Advertising/Competitor News BEER (Pg. 43) •Miller/Recycled Water •Competitor News/International I AT FRIDAY'S CLOSE I I I Philip Morris 87 - 1 3/8 Anheuser-Busch 64 5/8 - 1/2 ConAgra 38 3/8 + 1/8 General Mills 55 3/8 - 3/8 Kellogg 73 1/4 + 1/8 Procter & Gamble 83 - 3/8 RJR Nabisco 29 3/8 - 1/4 DJIA 4870.37 +6.14 ~ I This publication is ec c ab . Please remove mailing label prior to recycling. I

TOBACCO PHILIP MORRIS COMPANIES INC. 7HE NEW YORK TIMES, SATURDAY, NOVEMBER 11, 1995 -2- NOV 1 3 C'BS-TVStation Drops Commercial Critical ofSmoking By BILL CARTER A television station owned by CBS killed a commercial critical of the tobacco industry on Thursday, the same day it was disclosed that the CBS News program "60 Minutes" had dropped a planned interview with a former industry executive. The commercial had been broad- cast for about a month on KCBS, the station owned by CBS in Los Ange- les. It was also sold to 20 other television stations in California, none qf which have dropped it, said Bruce Silverman, the president of Asher/ Gould Advertising, the Los Angeles- based firm that produced the com- mercial and placed it on television stations throughout the state. "After the spot ran," Sybil Mc- Donald, the spokeswoman for KCBS, said yesterday, "the station manage- ment felt the need to re-evaluate the spot because of one line in it." The line, she said, was "the more nicotine cigarettes have, the more hooked you'll be." The station's managers decided this line "implied spiking," Ms. McDonald said, "and spiking has become an extremely controversial issue in Congressional hearings about cigarettes." "Spiking" was also the crucial word in a report on the tobacco in- dustry by "Day One," an ABC News program, that led to a $10 billion lawsuit brought by Phill Morris. ABC settled the sutt ear ter t is year, agreeing to pay Philip Morris's legal costs and to make a highly unusual apology on the air. Ms. McDonald conceded that the California commercial did not con- tain the word "spiking" and said no tobacco company had threatened a lawsuit over the ad. "But because of the controversy and the fact that the issue of spiking led to ABC's retrac- tion," she said, the station's manage- ment ordered the commercial dropped. The two managers who made the decision were William Appelgate, the general manager of KCBS, and Jehn McKay, the sales manager. Both men were unavailable for com- ment yesterday, Ms. McDonald said, because they were out of the office playinp,golf. Tom Goodman, vice president of communications for CBS in New York, said KCBS had made its deci- sion without any input from network executives. Mr. Silverman "said he had learned the commercial had been dropped when he arrived at his office Thursday morning. "I had al- ready read the story in that morn- ing's paper about '60 Minutes' cav- ing in on their interview with the tobacco-industry executive," Mr. Sil- verman said, "and I had a message on my machine saying that KCBS was pulling our commercial." Executives from "60 Minutes" said they had backed away from the interview with a former tobacco-in- dustry executive who was to offer critical testimony about the industry because the network's lawyers feared a multibillion-dollar lawsuit brought by a tobacco company. CBS did not believe the interview would be vulnerable on the basis of libel, the "60 Minutes" executive said, but on an arcarie issue called tortious interference, which relates to induc- ing someone to break a contract. Ms. McDonald said, "I don't think that the decision by'60 Minutes' was necessarily the issue" in the KCBS decision. Mr. Silverman said he had protest- ed the cancellation of the commer- cial, which was paid for by the State Department of Health using funds raised by a 25-cent tax imposed on a pack of cigarettes by a state referen- dum. Mr. Silverman said the KCBS deci- sion "means the broadcast media are saying we're not going to take the risk if the tobacco industry is involved." Mr. Silverman added, "It's a bit chilling when someting like this can happen." BP

-3- NOV 13 95 LQS AN6ELEs .rIMEs NOV 111995 Channel 2 Stops Airing Anti-SipokingAd r Media: Station denies action is tied to CBS' killing of `60 Minutes' sesment with former tobacco executivc.' By UAN MORA f N~~ TIA1[5 S'T'AFY WRITU SACRAbiEN'T0-On the heels of ' decision to cancel a contro- •veraza "60 Minutes" interview with a bacc industry executive, the networ -owned aff•iliate in Los Angeles has killed a tough-edged state-sponsored anti-smoking commercial it had run for ftve weeks. FCC>;3S, the t.os Angeles afftliAte, spiked the commercial titled "Flooked." In It, an actor wearing a business suit ia fishing alone from the end of a dock. As he pulls t'tsh after fixh from the water; a narra- tor describes how nicotine In cdga- rettes makes them addictive. The spot, whioh is aimed at teen-agers, ends with a close-up of the man's darkenedteeth. "We're disappointcd and trou- bled by. the decision," said Kim i3elshe, director of the state De. partment of Health Services, which sponsored the ad as part of its anti-tobacco campaign. KCBS had run the commercial during broadcasts of "Hard Copy." Selshc said that no other stations in the state have compiainCd about the ad and that it will continue to air for another week, including on several other Los Angeles stations. Sybil MacDonald, apoKwfoman for KCBS, said the station on ita own re-evaluated the spot. Station executives decided to kill the coam- mercial Wednesday after conelud- talg that there was a problem with one linct "The mare nicotine aiga- retiss have, the more hooked you'll be." "Management felt thia impiiied [nicotine) spikiilg, which has been ari extremely contentious i$SUe," sdaclyonald said, adding that the station's decision was not the result of outside pressuro. C igarette companies contend that niootine ia not addictive, despite what Belshe calls the "tona of evfdencc produced by scientists showu'V, that it is. ` KCBS' decision comes as, the tobaCco industry has become In- creasingiy combative. Pn ,August., ABC.Settled a libel suit by tobacco giant Phili Iidor'ria by airing an apology or c aIming in one of its' news scgmente that companies manipulated; or spiked, nicotine levels in cigarettes. This week, CBS attracted Attetl- tion when ttetwork attorneys pre• valled in stopping a segment from cover,-ge avaa'able airing thii Sunday on "80 Minutee." The teieviston shpw had ploAned to run an intervicw witl.an unnamed former wn & Wiltiamson tobacco executive critie o e ndustry. CBS' legal department baliQved that by airing the segment, the network might be liable for violat- ing an agreement between Brown & Williamson and tt}e anonymous former employee that he not dis- cuss internal dompany mAtters. In Los Angeles. MacDonald said the decision to. ecase airing the "Hooked" ad had nothing to do with the "60 Minutes" action by CBS in New York. ~"It was an Internal decision;' MacDonald said, adding that the station will continue to broadcast two loss,bard-edged spota that'are part of the state anti!tobacco ad- vertising Campaign paid for by Proposition 89 funds. Beishe called KCBS' timing "cu- rtous." Bruce Silverman, president of Asher/Gould, the Los Angeles advertising firm that created the commercial,'said, "I find it suspi- ciously coincidentat: " Silverman said KCBS sales nain- ager John McKay gave him the final decision Friday, explain.iri,g that the Spot implies tobacco in- dustry officials know that the more ' nicotine t,here ia in a cigarette, the better the chance they have of hooking young uFers. ~

-4- THE NEW YORK TIMES, MONDAY, NOVEMBER 13, 1995 CBSExecutives Killed Story, '60 Minutes' Broadcast Says By BILL CARTER The CBS News program "60 Min- utes" offered its own explanation last night for why it decided not to broadcast a planned interview with a former tobacco industry executive, saying on the air that because of fears of a lawsuit, "CBS manage- ment told us we couldn't do that." Instead, the program reported on the lengths the tobacco industry has gone to muzzle its critics. In so doing, in the eyes of some journalism analysts, the program risked its 27-year reputation for tak- ing on any subject, no matter how large or powerful. "The conflict of interest between business and journalism was naked on the stage," said Joan Konner, dean of the Graduate School of Jour- nalism at Columbia University. "I felt very bad for the '60 Minutes' crew because they're great journal- ists, but they were embarrassed and it showed." "I think what happened here is proof of the primacy of lawyer§ over editors," said Marvin Kalb, the di- rector of the Shorenstein Center on Press and Public Policy at Harvard University, "It is sad that '60 Min- utes,' which has always been free- wheeling in its approach and has always produced solid journalism, should be in this position." The original report was to have contained an interview with a for- mer executive of a tobacco compa- ny. The man was to have been identi- fied and interviewed on camera. But CBS management reportedly feared, in part, that they might be held legally responsible for inducing the executive into breaking an agreement he had made with the company, upon his departure, not to disclose internal company matters, -Other CBS employees have identi- fied the company as the Brown & Williamson Tobacco Corporation. Last night's report contained a brief comment from the executive off-camera and with his voice dis- guised. A spokesman for Brown & Wil- liamson has said the company has not threatened a lawsuit and has not contacted CBS about the report. Richard Campbell, a former pro- fessor of communications and jour- nalism for the University of Michi- gan and author of a book on "60 Minutes," said last night's report contained some of the familiar strengths of "60 Minutes," mainly its ability to shed a bright light on issues that the public may have only been glancingly aware. "But I think the end result was pretty weak-kneed," Mr. Campbell said. He said he was especially struck by the program's failure to say that the management decision came as CBS stockholders were con- sidering a merger with the Wes- tinghosue Electric Company. Noting that "60 Minutes" has a spotless legal record despite all those years of investigative report- ing, Mr. Campbell said, "It just strikes me as fishy that the manage- ment would not go to the wall for an institution with that kind of track record." He added, "We've come to depend on '60 Minutes' for upholding the tradition of afflicting the comfort- able and comforting the afflicted, and they didn't do that tonight." Mike Wallace, the correspondent who reported the story last night, said in a closing "personal note" that the program's staff had been "dismayed that the management of CBS had seen fit to give into per- ceived threats of legal action." He noted that the program had broad- cast many such investigative re- ports in the past "and we want to be able to continue." He added, "We lost out - only to some degree - on this one, but we haven't the slightest doubt that we'll be able to continue the '60 Minutes' tradition of reporting such pieces in the future, without fear or favor." Mr. Campbell said when he heard those remarks, "I was yelling at the TV: 'Unless it involves the tobacco industry.' " The report mentioned both the in- ternal debate at CBS over the inter- view with the former tobacco indus- try executive and ABC's recent set- tlement of a $10 billion lawsuit filed by Philip Morris, a settlement being wi e y ct e as starting the chilling effect that helped kill the CBS inter- view, i~~V 13 410 DAILY NEWS • Monday, November 13, 1995 Mike Wallace4its- !60 Minutes'-move CBS newsman I4like Wallace 'took an on-the-air swipe last night at his network's decision to drop part of a"60 Minutes" segment critical of the tobacco industry. He did it on "60 Minutes." "We are dismayed the man- agement has seen fit to give "in," Wallace said in a brief commentary at the end of the truncated tobacco piece. Network lawyers had batked at airing an interview with a one-time tobacco exec- e utive who had signed a non- disclosure contract with Brown & Williamson Tobacco Corp. Any inducement from_ CBS to break that agreement, the lawyers believed, could expose CBS to a lawsuit. The mutilated piece includ- ed just parts of the interview. "CBS Evening News" an- chor Dan Rather had earlier expressed his displeasure with CBS management. "If you believe in your stuff, let them take you to court," Rather told radio's Don Imus on Friday. Wallace said he and the rest of the "60 Minutes" team hoped to continue the show's. investigative tradition despite last night's setback, • . Stephen McFarland

USA TODAY • MONDAY, NOVEMBER 13, 1995 INSIDE TV / BY PETER JOHNSON CBS heavy hitters decry '60 Minutes' decision '~ The old guard at CBS News, fearing the network's news- gathering reputation is at stake, is blasting CBS' decision to drop part of a controversial 60 Minutes piece. Three of CBS' biggest names - Dan Rather, Mike Wal- lace and Walter Cronkite - say the incident gives CBS News a black eye and could haunt the division. CBS revised Sunday's Minutes out of fear that it could be sued if an ex-tobacco industry employee violated his con- tract by disclosing company secrets. A potential lawsuit "would cost a lot but not as much as it's going to cost us if we get a reputation for folding every time somebody threatens us," Rather told syndicated radio host Don Imus. Minutes' Wallace, who did the report, initially sup- ported CBS' decision. But in an interview with the CBS Evening News, he seemed to back away from that sup- port Talking to CBS' Edie Magnus, Wallace said: "It's the first time that we really feel that we have ... been let down by the company, but I guess that's what a lot of people at 60 Minutes do feel: " "It's a shame that should be happening," Cronkite tells CNBC's Tim Russert to- night (8 ET/5 PT). "Those who permit such pressure to be exerted clearly are By Muty L.tlwhvidl~r, AP Walter CroNdte: Ex-anchor calls the situation 'a shame.' thinking purely of their pocketbooks and that alone - not of the people's right to know or necessity to know - and I abhor it I was never once asked to leave something out or put something in because of a commercial interest in the broadcast" Wallace concluded Sunday's broadcast by reiterating his dismay with the decision, but he expressed belief that the 60 Minutes tradition of reporting would continue. CBS spokesman Tom Goodman said the company would have no comment -5- DAILY NEWS • Saturday, November 11, 1995 Dan rips CBS for snuffing. cig story By RICHARD HUFF Daily News Staff Wr ter CBS News anchorman Dan Rather yesterday blasted net- work lawyers for forcing "60 Minutes" to "back down" from a controversial report on the tobacco industry. Rather warned the move could further tarnish the im- age of the Tiffany Network. "I can't believe this thing," Rather told WFAN Radio's hon Imus yesterday. "I don't l'ike the way it makes us seem. ;''Ifyou believe in the report- i_sig, if you believe in your stuff, ,Wt them take you to court," Rather added. "I'd rather take ;>Wy chances in front of a jury an take my chances in front corporate lawyers. ~•"Let's face it, the lawyers i:• er want you to run a story. ~'~ ey can't get in trouble if you n't run a story. I don't like it y time we back down, back back away." Rather was fuming over the i i~etwork's decision to drop ar't i interview with a former tobac= ,eo executive who was legally (iound to not talk. CBS lawyers were con- '(~erned the former exec's com- ments would have violated his contract and made the net- -work vulnerable in a lawsuit. The move came months af- 4r ABC News was forced, in e face of a $10 billion law- #&it, to apologize for a report Adleging that Philip Morris in- tentionally 'spiked" nicotine levels. Rather said that ABC "fold- ed like an accordian." ' The anchorman acknow~l- edged a lawsuit "would cost a lotI but not as'much as it's go- ing to cost us if we get a repu- tation for folding every time somebody threatens us," NOU 1 3 10@1, °. Wallace rips ~ CBS for gutting ?> cigarette story ~ on `60 Minutes' < By MICHELE GREPPI ,.~'.> Mike Wallace believes "60 Min- ~ utes" was "let down" by CBS Y when the network dropped part of cc an interview criticizing the in- 0 creasingly combative tobacco in- dustry on tomorrow's broadcast. LU "It's the first time that we reallv Z feel that we have . . . been let down by the company," Wallace told "CBS Evening News" correspondent Edie Magnus when she interviewed him for an unusually self-critical report for last night's "Evening News." ~, "But I guess WALLACE that's what a lot of people at '60 Minutes' do feel," he said. But those com- ments were ed- ited fi•om the "Evening News" report the public saw. ABC News re- cently apologized for a "Dav One" report about nicotine levels in ciga-, rettes rather than continue to fight a $10 billion defamation suit filed by Philip Morris. Critics said the resulting effect led CBS News to cave in and restrict Wallace's "60 Minutes" interview because network la«}ers feared CBS might be sued - not for libE+l . but for tortious interference. Wallaces unidentified interview subject signed an agreement not to reveal internal workings during his employment by the cigarette maker. In the "Evening News" report, Wallace told Magnus, "The people who own the network are saying you caa t do it, because if you do do it, it will conceivably cost this com- pany more than the net worth of the company." Wallace, however, was allowed to . uestion the man about death threats made to him and his family when it was learned he would talk about secret tobacco-industry prac- ~ ticies. ~ That information will air on °60 t,q Minutes" tomorrow in «'allace~s re- io port on the lengths to which tobacco ~ companies go to keep information from the public. qa Wallace declined last night taela,b- t!t orate on his tomments'editedlfmni' W the `&ening News'story: .. . . . - -

-6- NOV 1 3 166~ THE NE W YORK TIMES EWORIALS f LETTER$ S UNDAY, NOVEMBER 12, 1Q95 Self-Censorship at CBS - '. The emerging picture of what cigarette• manu- facturers have known and done or failed to do about the health hazards of tobacco is one of the biggest aria most absorbing news stories of the year. Never- thetess, "60 Minutes" has decided to spike an inter- view with a tobacco-industry whistleblower out of fear of a lawsuit that the industry had not even threatened to file. This act of self-censorship by the country's most powerful and aggressive television news program sends a chilling message to journal- ists investigating industry practices everywhere. CBS's legal concerns over the interview were said to be based on fears that the subject of the interview, a former executive of the Brown & Wil- liamson Tobacco Corporation, had an agreement with the company not to disclose internal company matters. The CBS lawyers argued that the tobacco company, instead of claiming that it had been libeled by a false report, would simply declare that its former employee was committing a contract violation. CBS, these lawyers said, could then be held' liable and be directed to pay huge amounts in damages for inducing him to do so. One disheartening aspect of CBS's decision is that the theory of liability for inducing someone to break a contract is almost wholly untested in news cases when First Amendment protections of free- dam of the press are at stake. Many legal scholars argue that.liability in such cases can be overriden when a public good is served, including •public' health. Were this doctrine to be accepted, it would devastate independent journalism, which counts on people to come f orth and speak of wrongs they know about inside protective organizations. In any event, CBS's response to a feared suit under this doctrine wa5 exactly wrong. New York-ba$ed news organiza- tions often face legal challenges in unfriendly state courts. They have an obligation to defend the jour- nalistic franchise rather than cave in at the pros- pect of litigation. But'the most troubling part of CBS's decision is that it was made not by news executives but by corporate officers who may have their minds on money rather than public service these days. With a $,54 billion merger deal with the Westinghouse Electric Corporation about to be approved, a multi- billion-dollar lawsuit would hardly have been a welcome development. Some of the executives who helped kill the "60 Minutes" interview, including the general counsel, stand to gain millions of dollars themselves in stock options and other payments once the deal is approved. "60 Minutes" promises a report on this entire matter tonight. That report should include full disclosure of how much every business and news executive involved in this deci- sion stands to make from the merger. CBS and its general counsel insist that no one acted out of personal, monetary interest, but the network's action shows that media companies in play lose their journalistic aggressiveness when they let lawyers and corporate executives make decisions that ought to be the province of news executives. The same issue was raised last sum- mer, when ABC News settled a lawsuit with the P~hili Morris Companies and the R. J. Reynolds o ac~6 co Company, rather than contest it in court. Last week, Mike Wallace, the cor'respondent who reported the story for "60 Minutes," acknowledged that CBS was influenced by that settlement when it killed the tobacco interview. None of these concerns'would be so important were it not for the fact that the atmosphere has been chilled by the big tobacco companies' attempt to save a dying industry by using money and legal threats to silence its critics. Their ugly effort will fail because the Government, the scientific and medical communities and the American people have turned against their killing products. The industry's campaign of intimidation and distortion - arguing, for instance, that curbs on advertising of cigarettes aimed at young people are an unwarrant- ed intrusion by slovenly government bureaucrats - cannot hold back the truth or the stricter regulation that is on the way. Eventually, too, the inside secrets that people from the industry have to tell will make their way into the public. Given the tide of principle on this issue, it is a shame 'that CBS chose this moment to water down its report. The traditions of Edward R. Murrow and "60 Minutes" itself were diluted in the process.

-7- November 13, 1995 B A R R O N' S Non-Running Stories BY ALAN ABELSON I T MAY HAVE BEEN MARATHON WEEK IN NEW YOR K City, but the non-runners hogged the headlines. Most prominent, of course, was Colin Powell• Mr. Powell announced that he wouldn't run in the Republican primaries for the 1996 Presidential nomination. Dictating his choice, the ex-Chief of Staff contended, was his failure to experience an inner calling that he felt a prerequisite to taking the plunge. Perhaps. But we suspect there were other considerations that came into play as well. The sudden eruption of strident opposition to the possibility of his candidacy, for one thing, not from yellow-dog Democrats but from rock-ribbed Republicans. The discovery that GOP stood for Get On Powell at the- very least must have given him serious pause. And, after soberly measuring himself against the rest of the Geld. Mr. Powell couldn't help but realize he'd come up short in several critical departments. He doesn't, for example, look as good in a plaid flannel shirt as Lamar Alexander. He couldn't hope to match the sheer charm of the front-runner, Bob Dole. Nor is his direct and matter-of-fact delivery anywhere near as riveting as Arlen Specter's adenoidal eloquence. Most unnerving of all, Mr. Powell doubtless was aware that he'd have to compare his battlefield experience with that of such heroic warriocs as Phil Gramm, Pat Buchanan and Newt Ging- rich. Political pundits in the press (an elite corps of journalistic stableboys) were quick to sneer that Mr. Powell's real problem was that he lacked "fire in the belly," Why a condition that suggests an incurable addiction to crushed hot pepper is deemed an essential qualification for the Presidency, they neglected to say. Picking through their assorted natterings, however, we pieced together the key elements of their analysis: Colin Powell's fatal political flaw is a willful refusal to play by the rules. He won't deliver a well-placed blow to the kidney or knee to the groin. He's shamefully loath to lie or to grovel. He demurs from routinely questioning an opponent's legitimacy, demeaning his manhood or even, if you can imagine, accusing him of burning the flag and hating apple pie. Whew! We shudder when we think of it: A man so disdainful of our political traditions might actually have been elected to this proud nation's highest office. Close call, America! The other noteworthy non-runner was 60 Minutea, which decided not to run a segment of an anti-^ toacco rP ogram for fear it might be sued for i on. Understand. CBS wasn't scared it'd be sued for libel. Rather, it felt in harm's way of litigation because a former employee of a tobacco company, whom it had interviewed, had a non-disclosure contract with the tobacco company. How any rational being would conclude that such a circumstance laid the network open to litigation is beyond our ken• CBS explained that it wasn't a rational being that came to that conclusion, but a lawyer. There is a difference, some perceptive observer has remarked, between a lawyer and a mackerel. One is cold and slimy and the other is a fish• And, as ABC earlier demonstrated and CBS now has confuzned, there is a difference between a television network and a jellyfish. A jellyfish has backbone. The legal term for the action that made CBS tremble is called "tortious interference," and it induces "courage NEWARK STAR 'LEDGER ~ SUNDAY NOVEMBER 12, 1995 here -t~iere,7s - smoke . .` ,~s' - ::,. ~. . ,..... .. . ..•a. . 0 I Ef you're citrious about-theA actics that fall open to any jury of tobacco farmer,s that the tobace dus .rv employs in Its ef- Brown & Willlamson•could assemble in an fort to get millions of Americans hooked appropriate courthouse In North Carolfna- on saloking, there's a certain disgruntled to- If cigarettes are indeed'as harmless and bacco executive you should iilvite to your wonderful as the tobacco people claim, 'the next party. The executive, whoever he I's, was companies shduld be glad to let the debate willing to tell all on the CBS show " M'proceed unfettered: Failing that, their heavy. Les." handed attacks on freedom of expression are But you won't be hearing from him. '. simply going to make the public even more .Tbat's what lawyers are for. • curious about their attempts to buy polf- -The lawyers at CBS backed oPf the inter- ticians with campaign contiibutions and to view,,which would have aired tonight, amid buy silence with high•priced mouthpieces. feart that the lawyers at the Brown & Willi• '. . But before we work up too much sympa= arnson Tobacco' Cqp. would sue them if the thy for CBS, we need to consider the awful kxecutive's views w1re televi'sed. . .' recedent it has set here by turning lawyers The dispute'centers not on the accurafy ~tp editors. The traditional stance of the -of the executive's views - whatever they may media toward these questions has always .be, - but on an obscure legal doctrine called beeri that it it's true and newsworthy we'll "`tort±ous Interference." The executive had p~t it. ' signed a contract with the company statin that he would not speak publicly about what ~e CBS stance, however, makes truth ~ondary: "60 Minutes" producer Don He- ';he•-' did f,eaving during his aside time the there:, ~ question of j'ust ' what ~tE said of the suit, "That's a=15 billion gun -sort of industry feels a need tp swear its em- p.ointed at your'head. We may opt to get out •ployees to secrecy for life, there li the ques- of the line of ffre. That doesn't make me ~, tion of who could be sued if you happened to proud, but It's not my money." ••. . N meet this executive at a party and somehow The clear message to every business ~ inanaged to get him to confess about his life .,that has some rather dubious secrets it ~ as a tobacco pusher• The answer. him. wants to keep: Muzzle those whistleblowers, W `I But should CBS become the conduit for The media will back down. the confessions, well, that's where the law- Keep that in mind il you tune In "60 ro.n ye,rs come in..The deep pockets of CBS then Minutes" tonight. : - W iru'v 1 3 °' interruptus" in those threatened by its emplo-vment. Bob Sack, who worries a lot about first-amendment stuff and is the only lawyer we've ever come across who deserves the appellation "learned counsel." in effect suggests that, were CBS to set a precedent, it would represent torturous interference with the gathering and spreadmg of the news. He points out that compelling journalists to obey the letter of tort law in instances like this is comparable to requiring the police to adhere to the speed limit while in full pursuit of a criminal or insisting a doctor not park illegally while attending an emergency. The news for television networks, of course, is filler between commercials, so Bob's concerns are not of the sort likely to sway the pooh-bahs at CBS. Besides, as the producer of 60 Minutes plaintively explained, nobody likes to have a $15 billion gun "pointed at your head." Especially if it's a smoking gun. Both the non-running stories - and notably the one featuring Mr. Powell - were taken beautifully in stride by the stock market, which bulled ahead once again to new all-time highs• Which is only logicaL Why should the stock market pay any heed to the fact that there's one less candidate to head up the government, when the govern- ment's about to shut down?

-8- AREZONA R«#'UBL.IC NOv 13 18@5 Tobacco honchos huff, puff, blow CBS News' house down f you tune in 60 U in,Jr!on~C,B,,,,,,S I tonight, you'Il see a so-so segment on the tobac industry. What you won't scc is an interview with a tobacco insider who had some startling things to say about his company's practices. The intervicwa: was a high-ranking executive with B owadc Williamson T_o_b_a ~^~cQ.Ca, tl nation s t trd-Ti - biggest ~c~i~g~arctte maker. "•Ils knows everything," a source familiar with the matter told the Washington Post. "He's the biggest whisde•blowcr ever to come over to the other side." CBS pulled the hotly anticipated interview because its lawyers were worried about a biltion•dollar lawsuit. They didn't fear a fibel complaint; the story's truth was not in doubt. In this case, the executive had signed a non-disclosurc contract when he left Brown & Williamson. The CBS lawyers, who prevailed over arguments by 60 Minutes producer Don Ncwitt and correspondent mike Wallace, said thc tobacco company mi;ht sue the network for its part in helping him violate the agreement. , The Suit they feared would allege "tornous interference" - a term that refers to inducing someone to break a contract. Such a enncern seems reasonnblc to raise, but kating it censor a significant story may be without precedent. Bruce Sanford, a media attorney in Washington. D.C., called it "a truly eccentric argument." rorrner CRS anchorman Walter Cronkite, who once sat on the network's board of directors, took offense at what he called commercial pressure. He said those "who permit such pressure to be exerted are thinking purely of their pocketbooks ,ir1d are not thinking of the pcople's right and necessity to know, and I abhor it." Yaui Ecksrcut, a Phocnix lawyer S 16VE W(lS4N Republic Columnist toward the tobacco industry. His company, Loews Car ., counts among its subsidianes e cigarette maker Lorilla Tnc. The head of Lori{lard happens to be his son, Andrew Tisch - a corporate coward who testified at a congressional hearing lbst year he doesn't believe ~sm_o~f{ing causes death. CBS had yet anothet motivation for spiking the 60 Mrnutes story: Next week its shareholders will vote on a takeover by Westinghouse Electric - _'f~e transaction stands to be worth C who has defended the media in many a mtllton dollar5 or more in stock cases, said he knew of no prior uses of options to several CBS executives, the tortious interference in a journalistic Post rcported. They include CBS contcxt. News President Eric Ober and general "To the extent that whistle-blower law protects employees who reveai something that is dangerous or fraudulent, a non-discloaure agreement ought not to trump that law, and I think the courts will rule that way." F,ckstein called the capitulation by CBS "a gross overreaction" to the settlement two months ago of a 3iS billion lawsuit filed by Phili yi._orris against,&AQ News. in that case, ABC gave Philip Morris several million dollars and an apology for reporting that additional nicotine is added to cigarettes. ABC has been widely criticized for not ctanding behind a weil-documcnted story. Wallace, who conducted the 60 Minutes interview, acknowledged that ABC's settlement figured into CAS' decision. "it has not chilled us as journalists, but it has chilled lawyers and it has chilled management," Wallace said, i.aurence Tisch, the owner of CBS, is a chitling man to begin with, a counsel Ellen Oran Kaden, who pressed concerns about a tobacco lawsuit. It's worth noting that ABC settled with Philip Morris shortly after its merger with Disney Co. was announced, So I see the decision by CBS as a troubling sign of not only the tobacco industry's legal clout, but also of the conflicts of interest that can arise from media mergers and can compromise news judgtnents. "CBS isn't what it used to be," Eckstein said. "Tn the old days. CBS would have gone to the wall. Many modern media owners aren't ncarly as committed to the public interest." By backing offan important story to avoid the risk of a fanciful lawsuit, CBS has set a new standard for media timidity. The network won't get sued, the public won't get informed and the tobacco company will go on reaping handsome profits from its deadty prcxlucts, bottom-line type with scant interest in As Cronkite used to say in the journalism. And Tisch has another network's better days, thut's thc way reason to be less tban aggressive it is. (Qther coveYa;e available upon rey~2st.) I

MS Smoker's Suit, Justices Agree Tobacco Harmful But No Damages Justified JACKSON, Miss. (AP) The Mississippi Supreme Court has ruled that a Lafayette County jury was correct in not awarding damages to the family of Nathan Henry Horton, who died in 1987 from lung cancer. In the same ruling Thursday, the justices agreed with the same jury's finding in 1990 that the cigarettes that Horton smoked for 35 years were " unreasonably dangerous.'' While the two issues appeared to conflict, Justice Fred Banks, writing for the court, said the jury was justified in denying damages because Horton contributed to his illness and subsequent death. Banks said the Hortons won the declaration that cigarettes were harmful. Horton's family had asked the state high court to order a hearing on damages, which was denied. Justices also denied a motion by American Tobacco Co., makers of the Pall Mall cigarettes that Horton smoked, and New Deal Tobacco and Candy Co. Inc., a Greenwood distributor, to toss out the entire case. Horton had sued in 1986, while he was still alive, for $2 million in actual damages and $15 million in punitive damages. A first trial ended in a deadlocked jury in January 1988. The second trial was moved to Lafayette County from Holmes County. Horton, in a deposition filed after his death, said he had been smoking since 1955 first with rolled cigarettes and then unfiltered Pall Malls. Horton died Jan. 27, 1987. He had been diagnosed with lung cancer in 1986. Tobacco company attorneys argued that Horton knew the dangers of smoking but didn't let that stop him. Attorneys for the Hortons argued on appeal that damages were justified in the case on grounds that the jury verdict established three crucial points: " That Pall Mall cigarettes are a defective and dangerous product; that those defective cigarettes caused Horton's death; and that Horton did not assume the risk of smoking. " The argument among Supreme Court justices centered on the issue of whether the Hortons deserved financial damages. A majority of the court said no. Chief Justice Armis E. Hawkins said the case should have been reversed and ruled in favor of the tobacco companies. Hawkins said numerous other cases on tobacco issues agree that " when a person buys a product which is perfectly legal to sell, and which he knows is designed to do certain things, he cannot hold the seller liable for the product injuring him because it precisely what it was designed to do. " Justice Chuck McRae disagreed, saying if a product to be dangerous, the producer should pay damages. did is determined McRae said while the dangers of cigarettes are now known, they were not when Horton was smoking in the 1950s and 1960s. He said Horton was never advised to quit smoking until 1986. McRae said the court should be prodding defendants to correct dangers to their products " not to promote them and prosper from them. " " Mississippi should erect billboards at all state lines which read, 'Welcome to Mississippi, where cigarette manufacturers need not pay the price for the damages their products cause.' " Today's opinion makes it cost-effective for tobacco companies across American to maim, injury and kill in Mississippi, " McRae said. Copyright (c) 1995 The Associated Press Received by NewsEDGE/LAN: 11/10/95 12:31 AM L9$LQT090Z