Federal Trade Commission, In re: R.J. Reynolds Tobacco Co., Matter No. D09285
(Advertising, US Dist Ct, Mid NC 1997 Dismissed) Citation: 14 F Supp 2d 757 (17 July 1998); 1999 WL 816699 (D.D.C. 24 May 1999)The Federal Trade Commission (FTC) filed a civil complaint against the defendant, challenging the use of the "anthropomorphic camel" also known as Joe Camel in its advertisements in August, 1990. In May 1993, the FTC's Bureau of Consumer Protection recommended the Commissioner issue a complaint, but following the defendant's submission of additional evidence, he refused to do so. The bureau renewed its efforts in 1994. On June 6, 1994, the Commission officially closed the investigation for lack of evidence that Joe Camel encouraged youth smoking. The commission staff renewed its investigation in 1997, and again urged the Commissioner to file a complaint, this time without allowing the defendant an opportunity to rebut. The defendant obtained a hearing where it put forth evidence, but the Commission voted 3-2 to issue the complaint on May 28, 1997. The Commission's investigation was ongoing at the time of the trial.The defendant sued to quash the complaint on June 17, 1997. On July 28, 1997 it filed an additional complaint alleging violations to the Sunshine Act. It argued that the complaint was motivated by pressure from the Clinton administration. The defendant alleged that the FTC had violated its own rules by reopening the investigation without Commission authorization, and by failing to provide an opportunity to rebut, and by not complying with the Sunshine Act's procedures on the vote. The defendant sought a close to the investigation and a withdrawal of the complaint.The case was heard in the United States District Court for the Middle District of North Carolina (No. 6:97CV00651) before the Honorable Judge Osteen. The judge (14 F.Supp.2d 757) granted the FTC's motion to dismiss for lack of jurisdiction on July 17, 1998. The courts had only limited power to review administrative proceedings, usually requiring a "final agency action" unless the agency acted in direct defiance of a statutory prohibition. Because the 1994 vote had gone against issuing a complaint, there was no formal adjudicative process at that time. The judge found that the FTC regulation requiring an order to show cause prior to commencing proceeding did not apply. Therefore, the commission did not have to formally reopen the investigation before its staff could proceed. He could not perform an interlocutory review of the decision to file an administrative complaint, even if politically motivated and questionably carried out.The case was then heard by the United States District Court, District of Columbia (No. 97-1700 TFH), before the Honorable Judge Hogan. On May 24, 1999, the judge (1999 WL 816699 (D.D.C.)) granted the FTC's motion to dismiss for failure to state a violation. The judge found that the FTC did not violate the Sunshine Act, requiring meetings to be publicly announced, by failing to follow normal procedures, because it instead issued three public notices regarding the meeting. The defendant presented no evidence that the notice dated May 9 was not in fact posted on May 9, thus there was no claim on which relief could be granted.