Tobacco Manufacturers Reach Settlement With Department of Justice

The agreement will require signs to be posted at participating retail locations.

July 15, 2022


ALEXANDRIA, Va.—Altria, Philip Morris USA Inc., RJ Reynolds Tobacco, and ITG Brands reached an agreement in long-running litigation brought by the U.S. Department of Justice (DOJ) and certain public health organizations regarding the communication of tobacco-related messaging at retail locations. The agreement will require those tobacco companies to supply court-ordered signs to stores that have contracts with any of them and require those stores to post the signs for a total of 21 months.

The agreement covers the last remaining dispute from the lawsuit DOJ filed against Altria, Philip Morris USA Inc., and RJ Reynolds in the 1990s. NACS and the tobacco companies spent 17 years fighting any signage requirement through the litigation process and, along with the National Association of Tobacco Outlets, also participated in the negotiations that led to the agreement in order to advocate for retailers.

“This litigation has always put the retailers in a uniquely bad position,” said Doug Kantor, NACS general counsel. “Retailers were not parties to the lawsuit and should not be burdened with a court-ordered remedy, but this negotiated outcome avoids even worse results that DOJ and public health groups were advocating.”

The agreement provides that each store under contract with one of the manufacturers will have to post at least one sign carrying one of 17 different, pre-approved health messages that will be distributed at random to retailers around the country. Each store will be required to rotate to a new message halfway through the time period required in the agreement. The manufacturers will be required to hire auditors to check whether the signs are properly posted. NACS has prepared a summary of the agreement explaining the requirements for retailers, as well as answers to frequently asked questions about it.

A hearing on the proposed agreement will be held in the U.S. District Court for the District of Columbia on July 28 and 29. The court will then decide whether to accept the agreement and enter an order to implement it. The timing of the requirements for signs to be posted will depend on when the court decides whether to accept the agreement.

Retailers may support or oppose the agreement in writing and/or at the hearing. NACS will not object to the agreement because of the risks to retailers if this agreement is not accepted.

NACS will host a webinar on July 18, 2022, at 2 p.m. EDT to educate retailers on the agreement and answer questions about it. Register here.

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