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OFFICIAL TRANSCRIPT OF PROCEEDINGS BEFORE THE . :.~ Commission DOCKET In the LIatter of : Plini'O;~F:Ii ^-- Pl2Ce D. C. Date Tuesda.y, 3u +.;i 1, 1969 • Pages iNC. (!FFfC'I:'.}. ?.t POi;7 }{:;L.`, 25 ]: S7'kI'b;T, N. E. 1). C. :?ilUO:? I* ! - r`r,••: -1 :;*,

•1TC~ C • yaa:ettes S'!'A7.'EMEN`1' oF " /.1/b9 , CON? ENxS Dr. wxli.a.am :i. Stewart, SurVc:on General, U. S. Public Hoa].tWL,'Service; Accompanl4d by: Dr. Eenr.bth t%1. F:ndj.. ott, Director, National Cancer Institute; Dr. Pau]l x:ota.n, Director, National Institute for Fnviornmental HeaXth Sciences; Dr. Theodore Cooper, Di.zector, National Heart !' ' Institute; and, Dr. Daniel rIorn, Da..r, cctor, National Clearing .1iouse For Smol:ir,y aiid Health • Dr. Luther L. Terry, ChaS.rman, National Interagency Gouncil on Smor.i.ng and Health ,> P,AGB' 7 50 --Dr. Lluwis B:_ Januaxy, , Kmer.icar, -fIear..t Associat3.on; Accotepanied by:: Dri Camplbel:I. 11o~qes; - Dr. Donald :Z'. Fredera.cKson; and, JEsse R. F:ia.].man 65 Dr. Sol Ro Daxer, , Chairman, Committee on `.X'obacco and Cancer, A.mericar, Cancer Society 71 ([l2':['IaZi.~C~Oi~ Sk:SS~023 ~ p. $~i) Dr. Chaxl.es F. Tate, Associz:te Professor of k:edicinee of the Uni.ve?: si.ty of miarai 88 Dr. Robert H. BroZ•aning, Professor of Medicine, Ohio State University Co].l.ege of Med3.cine; 11ational Tuberculosis and Respiratory Disease AssoC-i.ation Ernest Cellhorn, Professor of Law, Duke University 133 Fred G, Bock, Di-rector, Orchard P;:r.:c Labox°t:'corie's, t4emo,L°ial Institute 163 I;ent;le;* J. Blum, Presi.den~, Smoke WGtcY:ers :Cnternatior,aX 1~( v

1 Ash (1) ws 1 . ~ I I BEFORE THE FEDERAL TRADE COMMISSION 2 M r - M A - N - ./ - - - rx • In the Matter of: s PROPOSED RULEMAKING PROCEEDING : FOR REQUIRING HEALTH WARNING IN s CIGARETTE ADVERTISING = s 3 4 5 -x 3 14 z 1 24 N M n . 25 .... ~;'~:. . Room 532, Federal-Trade Commission Bldg.,- Pennsylvania Avenue & Seventh St._, N.W., Washington, D. C. _ Tuesday, July 1, 1969 Met, pursuant to notice, at 30:00 a:m. - _= 10 BEFORr:- 11 PAUL RAND DIXON, Chairman 12 PHIL-I.P ELMAN, Member 13 .• EVERETT MAC I:NTYRE, ?;ember MARY GARDINER JONES, Member JAMES M. NICHOLSON, Member 15 16 17 18 19 20 U

2 THE I3AILIFF: The Honorable Commissioners of the Federal Trade Commissi.on.. The Commission is now in session. ,r CHAIR14hN DIXON: As stated in our Notice of Proposed Trade Regulation Rulemaking, published in the Federal Register on May 2-Oth, 1969, this hearing is held pursuant to Part 1, subpart B of the Commission's Procedures and Rules of Practice 10 11 12 of 1967, Sections 1.11, et seq. This proceeding for the pro- mulgation of Trade Regulation Rules regarding unfair_and - deceptive acts or practices in the_advertising of cigarettes. Copies of this Notice were sent to all knotim manu- facturers of cigarettes and to other interested parties. The Notice also sets forth a brief history of the N 15 16 17 18 19 20 21 22 23 24 2 Commission's 1964 hearings and proceedings in its prornulgation of a Trade l:c.gulation Rule on cigarettes; the fact that Congress on JuZy 27, 1965 enacted the Federal. Cigarette Labeling and Advertising Act, which barred a requirement for any different statement relating to smoking and health on cigarette packages other'than that set forth in the statute, and also barring a requirement for any statement relating to smoking health in the advertising of cigarettes which had been labeled in conformity with the provisions of the Act. Section 5(b) of that statute, which placed a moratorium on requiri.ng health warnings in cigarette advertising, expired todC.y.

J 10 1 15 16 17 18 19 0 20 8 .~ 21 0 " 25 . 3 Unless Congress should extend the,provxsions of the Federal Cigarette Lal-,elinq 'and Advertising Act, so ag to bar such action (and a bill has passed the House of Repre- sGntativcs to do so), the Com.mission, relyind upon its 1964 Findings and'having reason to believe that cigarette smoking creates hazards to health which should clearly be disclosed to the public in all cigarette advertisements, propose s to readopt its 1964 Trade Regulati.on Rule, modified to read as fo].lows : "in connection with-the sale,.offering fo.r sale, -or distribution in commerce (as 'commerce' i.s_ defined in the Federal Trade Convnission Act) of cigarettes, it is an unf:uir or deceptive act or practice within the meaning of paragraph a of the Federal Trade Com- mission T.ct (15 U.S.C. pvx-ac;raph 45) to fail to csisclose, clearly and prominently, in all advertising than ci.gare'ct smoking is dangerous to health and may cause death f-.rum cancer, coronary heart disease, chronic bronchitis, pulmonary emphysema, and other diseases." It must be clearly understood that the CommisUi.o: o . . . W ao c.ill not take any action in this matter which would be ir. ° v m conflict with any legislation on this subject which the o Congress may enact into law. if the Commission on the basis off the record of this rul.emaki_ng proceeding shou.)d detcrmi.nc t}-iatt a rule is 7°ecqui.red by f:he public interest, the effer-civc w L H ) . .. 11 k , .,

4 ~ ~ 10 11 12 5 < a 13 ~ 3 14 15 16 17 18 19 s 20 ~ ~ 21 0 € ~ 22 ~ e w 23 z ~ 24 4;; Y h n 2 date of such rule would not preced- the completion of . Congressional action on the pending legislation. , The purpose of this hearing is to afford all interested parties, who have so requested, an opportunity , to express their views on the subject matter involved and on the proposed-rule: The Notice also states "All interested pers~on including members of the'consuming public, are hereby notified that they may file written data, views, or arguments bearing on-the question whether the above*proposed Rule should_be' promulgated by the Commission, or whether the Trade Regula-_ tfon Rule.issued on June 22, 1964, should.be modified or repealed because of changed condit-ions or the public interest. -Submittals-should be-filed with the Chief, Division of Trade Regulation Rules, Bureau of Industry Guiday7ce, Federal Trade CorrImission." The Notice as might be anticipated, has brought for_ th a large number of responses, which have been raa de a part of the public record in this proceeding. They are available for public inspection in the Commission's Office of Legal and Publi.c'ReCords. A stenographic record of this hearing is being made and arrangements for the purchase of copies of the transcript may be made with the reporter attending the hearing or by maill to Ward and Paul, Inc. 25 K Street, N. E., Ulashington, D. C. 1

~ 2 ~ < ~ 3 I 4 5 7 10 11, 12 J < ti .~ 13 0 « < 3 14 15 16 17 18 ls ~~ 20 0 0 0 ~ ~ 21 6 ~ s €• 22 s % «~ 23 z ~ 241 N Y ~ 25 Due to the number of requests to be heard it has y been necessary to place a time limit on oral presentations -- I think all of you have been notified as to how much time you will have and as to when you are scheduled to be heard. We will do our best to hold to the schedule as made out. If you are unable to complete your presentatton.in the allotted time, you may, within twenty-four hours after the termination of these hearings, file a written statement covering those relevant matters which you did riot _orally present. Individuals making statements will do so without. being under oath and they will not.be_.subject to atiy interro- gation except for such questions as the individual Com- mis:;ioners may desire to ask. Since the Cor.-snission approaches this problem by way of a'~.~rad.e P.eclulatzon Rule, prospective in na•cuxe, it is VI~.atl to po.i.r,f. out that Trade Regulation Rules e}:pxess the experience and jud,mc.~n4 of the Conmission, based on facts of vhich it has knowledge derived from studies, reports, investigations, hearings, and other proceedings, or within official notice, concerning the subst«nt3.ve requirements of the statutes which it administers. ~ 0 w Where a Trade Regulation Rule is relevant to any c ~ zUsue involved in. an adjudicative proceeding thereafter ~ N instituted, the Comm3.ss3.on may rely upo-n the. Rule to resolve sucl, issue, provided thi.,t the respondent shall h~.vc hc=.en c;iven

6 a fair hearing on the applicability of the Rule to the .~ d : N ~ ~ particular case. )I, . All persons, firms, corporations, or others engaged in the sale or distribution of cigaret•tes:in commerce, as "commerce" is defined in the Federal Trade Commission'Act, would be subject to the reguirements_of any_Trade Regulation Rules promulgated in the course of thos proceeding. The Commission has decided that the time for filing 10 additional-written data, views or argument concerning the- proposed Rule should be extended to August 4, 1969. 11 Now, a schedule of witnesses has been made publ3.c 12 and distributed. We will hear first,from Dr. William H. 5 0 Stewart, our distinguished Surgeon General of the United .f 3 14 States Public Ilealth Service.' 15 I understand, Dr. Stewart, that you are accompan3.ed 16 by Dr. Kenneth 14. Endicott, Director of the National Cancer 17 Institute. 18 Will you stand up, sir. 19 Dr. Paul Kotin, Director of the National Institute 20 for Environmental Health Services. 21 Dr. Theodore Cooper, Director of the National Heart 0 Xnstitute. ~ 22 i ~ And Dr. Daniel Horn, Director, National Clearing 23 Z 0 House for Smoking and Health. ~ 24 k h Dr, Stewart, %%-el.co:ne. You Inay proceed.

7 STATEMENT OF DR. WILLIAM H. STEWART, SURGEON GL:N1:1tAL, U. S. PUBLIC HEALTH Q 3 SERVICE; ACCO14pANZED IIY DR. KENNETH M. ENDICOTT, DIRECTOR, NATIONAL 5 CANCER INSTITUTE, DR. PAUL KOTIN, DIRECTOR, N1YrT.ONAI. INSTITUTE FOR ENVIRONMENTAL HEALTH SCIL•'NCES, DR. THEODORE COOPERj DIk2ECTOR, - NATIONAL HEART INSTITUTE, AND 10 11 12 15 3_6 17 1.8 19 0 20 U ( V 21. ~ 0 ~ 22 ~ ~ 0 _ = DR. . DANIEL IiORIJ, DIRL•'CTORr. NATxONAL CLEARxNG HOUSE FOR- S1i0KING AND IiEAL~I'H DR.- STEWART: My associates and I are pleased to app3«•rr hefor•e you this morning to represent the Depar.tmentt oS H`a)_th, Edvcz,f:ion, and Welfare in connection with your propot;E:ci ruling on cigarette advertising. The rule which you are considering %^,ould require c?.ear and pro.-mineni: disclosure in all cigarette advertising that cigarette smoking is dangerous to health and may cause c3eath Zrom cancer, coronary heart disease, chronic bronchitis, pU CciT'i!ilyuG)l"c+, vncll other In our judg.ncxnt this is a valid ..tu4einent of f:he r_elcaf:;..or;sh3-p A•:hich exist~s Uetween c-5-garetcte smoking and Ile }?el.ii:vo ft?i'tilc:r • i: I)[`c 14.}1 ~?Ftr)i3 YaCJ :;J1U'U..LC~. it~)f~ 1;x i.) ~

., ., _ r 10 1]- 15 16 17 18 19 ~ 21 0 w 2 ~ 0 cigarette advertising. As you know, our Department has urged this from the beginning. tte supported this when it was included in the ruling which you-proposed in 1964 and we have three times urged the Congress to achieve:this end through legislation, in 1967, 1968, and now in 1969. , You have stated-in your announcement•that in your vie%•.,, the failure to disclose the hazards of cigarette smoking in advertising is an-unfair or deceptive act within the meaning of-thE Federal Trade.Commission Act. "On our part, we feel that without such a disclosure, the public is in- Adequate].y informed and the public health is inadequately_ protectec'x. COMF4ISSxONER ELMAN: Dr. Stewart, could x_-ask you a question at that point? nl:. ST'r'.W11R'1': Yes, si]'. CO.fi;1SSxONNR ELt`J1i1: Is your posi tion as stated a.n that lust sentence affected at all by any change in the language.of the warning on the package, such as is contained in H. R. 6543, as passed by the House? If the warning were changed to read that the Surgeon General has determined that cigarette smoking is dangerous to our health and may cause lung cancer or other diseases, would that change your position expressed here this mot.ninc3? UR: STEt•~AFt's: No, it would not.