Word: ftc
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Between the Federal Trade Commisssion and their own industry's self-imposed Cigarette Advertising Code, cigarette salesmen have just about been reduced to saying that a smoke is only a smoke. Among the many guidelines and prohibitions set by both the FTC and the code, as administered by former New Jersey Governor Robert Meyner, was one against advertising claims of low nicotine and tar content...
...that one, the FTC recently reversed itself, argued that information about nicotine and tar might be not only "material" but also "desired by the consuming public" as long as it came without collateral health claims. Behind the FTC switch was the suspicion that some companies had used the ban on any sort of nicotine-tar advertising as protection against adverse publicity while actually stepping up nicotine and tar content in their products. That content presumably enhances flavor-and "flavor" is the big word in cigarette advertising nowadays...
Does bigness, as such, constitute a violation of the Clayton Antitrust Act? Federal Trade Commission lawyers deny that the FTC has ever argued that it does. Nevertheless, the FTC surely appeared to be nearing such a doctrine in 1962 when it ordered Procter & Gamble to sell off Clorox Chemical Co., which P. & G. had acquired seven years earlier (TIME, Dec. 24). At the time of acquisition, Clorox held 49% of the U.S. market for liquid household bleaches. By buying the biggest bleach maker, the FTC contended, P. & G. avoided the risks of going into the field...
Last week, in the Sixth U.S. Circuit Court of Appeals in Cincinnati, the company won its case. In a decision that was tartly worded, a three-judge Federal panel commanded the FTC to dismiss its order against P. & G. "The Supreme Court has not ruled that bigness is unlawful, or that a large company may not merge with a smaller one in a different market field," the judges wrote. "Yet the size of Procter and its legitimate successful operations pervades the entire opinion of the commission and seems to be the motivating factor which influenced the commission to rule...
...FTC can appeal the ruling to the U.S. Supreme Court. But, said the judges pointedly, "This protracted litigation, which is going into its ninth year, should come to a close...