Of the Northern District of Illinois, sitting by designation. *

United States Court of Appeals

For the First Circuit

No. 06-1965

STEPHANIE GOOD, LORI A. SPELLMAN and ALLAIN L. THIBODEAU,

individually and on behalf of all others similarly situated,

Plaintiffs, Appellants,

v.

ALTRIA GROUP, INC., and PHILIP MORRIS USA INC.,

Defendants, Appellees.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MAINE

[Hon. John A. Woodcock, Jr., U.S. District Judge]

Before

 Howard, Circuit Judge,

Selya, Senior Circuit Judge,

and Shadur, Senior District Judge. *

Todd S. Heyman, with whom Thomas V. Urmy, Jr., Shapiro Haber

& Urmy, LLP, Gerard V. Mantese, Mark C. Rossman, Mantese and

Associates, P.C., Samuel W. Lanham and Cuddy & Lanham, were on

brief, for appellants.

Kenneth J. Parsigian, with whom Goodwin Procter LLP, H. Peter

Del Bianco, Jr., Lambert Coffin, Guy Miller Struve and Davis Polk

& Wardwell, were on brief, for appellees.

August 31, 2007
The parent company, Altria Group, Inc., did not join in the 1

summary judgment motion, seeking to preserve a defense based on

lack of personal jurisdiction. Nevertheless, the district court

observed that "the parties acknowledged as a practical matter that

the Court's ruling would be equally applicable to Altria." 436 F.

Supp. 2d 132, 134 n.4 (D. Me. 2006). Judgment was therefore

entered in favor of both Altria and Philip Morris, without

objection from either side.

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HOWARD, Circuit Judge. The plaintiffs appeal from the

entry of summary judgment for the defendants, Philip Morris USA

Inc. and its parent company (collectively, "Philip Morris"), on

state-law claims based on the marketing of "Light" cigarettes.1

The district court ruled that these claims were preempted by the

Federal Cigarette Labeling and Advertising Act (the "FCLAA"), which

provides that "[n]o requirement or prohibition based on smoking and

health shall be imposed under State law with respect to the

advertising or promotion of any cigarettes the packages of which

are labeled in conformity with the provisions of this chapter." 15

U.S.C. § 1334(b) (1998). Because we find that the claims are not

preempted, and because Philip Morris's alternative arguments for

affirmance are also unavailing, we vacate the decision of the

district court and remand for further proceedings.

I.

The plaintiffs, who say they have smoked Marlboro Lights

for at least fifteen years, claim that Philip Morris has employed

unfair and deceptive practices in "designing, manufacturing,

promoting, marketing and selling Marlboro Lights and Cambridge
Philip Morris's expert witness, in his affidavit submitted in 2

support of its motion for summary judgment, explained that "[t]he

terms 'light[s]' and 'low tar' are generally viewed as

interchangeable" and that, since the early 1970s, "light" has been

"associated with both lighter taste and low tar."

-3-

Lights purporting to be 'light' and having 'Lowered Tar and

Nicotine,' all while [it] knew those cigarettes would not deliver

less tar or nicotine to the consumer." These brands have rings of 2

ventilation holes in their filters, causing air to mix with the

smoke as the smoker draws on the cigarette. As a result, "Lights"

register lower levels of tar and nicotine than their so-called

"full-flavor" counterparts under a test known as the "Cambridge

Filter Method." This test uses a machine to "smoke" a cigarette,

collecting the resulting tar and nicotine in a filter for weighing.

The plaintiffs allege that a person smoking "light"

cigarettes, however, engages in unconscious behaviors that

essentially negate the ventilation effect, such as taking more

frequent, voluminous, or longer puffs, covering the air holes with

the lips or the fingers, or smoking additional cigarettes. Due to

such "compensation," which the plaintiffs attribute to the

addictive nature of nicotine, they assert that a smoker consumes

the same quantities of tar and nicotine from light cigarettes as

from full-flavored ones. The plaintiffs explain that the relative

levels of these substances bear on a reasonable consumer's decision

on which cigarette to purchase because consumers understand that

reducing the quantities of tar and nicotine in cigarettes reduces
The amended complaint also alleges that Philip Morris manipulated 3

the design of its light cigarettes "to register Lowered Tar and

Nicotine levels under machine testing conditions while actually

delivering higher levels of these compounds when smoked by

consumers . . . ." The plaintiffs have not advanced this theory on

appeal, however, so we do not consider it. 

In addition to their claim under the Maine Unfair Trade Practices 4

Act, the plaintiffs' amended complaint also asserts a second count

for unjust enrichment. Because neither side argues that the two

claims require different preemption analyses, we do not separately

discuss the unjust enrichment count. 

-4-

their adverse health effects. Thus, the plaintiffs allege that

Philip Morris has misrepresented material facts by describing its

"Lights" as such or as having "lower tar and nicotine," and that

Philip Morris--which was aware of the "compensation" phenomenon

before it began marketing its "Lights" brands--did so with the

intent to deceive. 

The plaintiffs claim that these misrepresentations amount

to unfair or deceptive acts or practices in violation of the Maine

Unfair Trade Practices Act. Me. Rev. Stat. Ann. tit. 5, § 207 3

(2002). This statute entitles any person who suffers a loss of

money or property as a result of such acts or practices to sue for

"actual damages, restitution and for . . . other equitable relief."

Id. § 213(1). The plaintiffs have expressly disclaimed any

"damages for personal injuries," but they do seek other relief,

including the return of the sums they paid to purchase Marlboro

Lights and Cambridge Lights, in addition to punitive damages and

the attorneys' fees as authorized by the Act. The plaintiffs also 4
-5-

seek to certify a class of all purchasers of Marlboro Lights or

Cambridge Lights in Maine through November 2002.

In response to the plaintiffs' amended complaint, Philip

Morris promptly moved for summary judgment. Philip Morris argued

that the plaintiffs' claims were (1) expressly preempted by the

FCLAA, (2) implicitly preempted by "the efforts of Congress and the

[Federal Trade Commission] for 40 years to implement a national,

uniform policy of informing the public about the health risks of

smoking," and (3) for similar reasons, not cognizable under the

Maine Unfair Trade Practices Act, which does not apply to

"[t]ransactions or actions otherwise permitted under laws as

administered by any regulatory board or officer acting under the

statutory authority of the . . . United States." Me. Rev. Stat.

Ann. tit. 5, § 208(1).

Each of these arguments relied to some degree on what

Philip Morris described as "the FTC's comprehensive, nationwide

program regulating the disclosure of tar and nicotine yields." In

1959, the then-seven major American cigarette manufacturers had

agreed to delete all tar and nicotine claims from their

advertising. The FTC subsequently advised them, however, "that a

factual statement of the tar and nicotine content (expressed in

milligrams) of the mainstream smoke from a cigarette would not be

in violation . . . of any of the provisions of law administered by

[the FTC]," provided the statement was "supported by adequate
-6-

records of tests conducted in accordance with the Cambridge Filter

Method." Press Release, Fed. Trade Comm'n (Mar. 25, 1966). But

this advice did not extend to "collateral representations (other

than factual statements of tar and nicotine contents of cigarettes

offered for sale to the public) . . . expressly or by implication,

as to reduction or elimination of health hazards." Id.

Then, in 1967, the FTC itself began using the Cambridge

Filter Method to test, inter alia, all cigarette "brands for which

any tar or nicotine statement appears on the label or in the

advertising . . . to determine the accuracy of such statement." 32

Fed. Reg. 11,178 (Aug. 1, 1967). Though the FTC understood at the

time that this method could not "determine the amount of tar and

nicotine inhaled by any human smoker," it was nevertheless adopted

to produce results "based on a reasonable standardized method"

which were "capable of being presented to the public in a manner

that is readily understandable." Press Release, Fed. Trade Comm'n,

FTC to Begin Cigarette Testing (Aug. 1, 1967). The FTC agreed to

report the test results to Congress periodically in order to ensure

their dissemination to the smoking public, and made the first such

report in late 1967. 

The FTC subsequently proposed a rule requiring cigarette

manufacturers "to disclose, clearly and prominently, in all

advertising[,] the tar and nicotine content of the advertised

variety . . . based on the most recently published [FTC] test
Most of these manufacturers belonged to the Tobacco Institute, an 5

industry group that was disbanded in 1999 pursuant to the master

settlement agreement between a number of states and cigarette

companies. The testing has since continued at the Tobacco Industry

Testing Laboratory, a similar facility.

-7-

results." 35 Fed. Reg. 12,671 (Aug. 8, 1970). But the rulemaking

process was suspended when a consortium of cigarette manufacturers,

including Philip Morris, reached an agreement with the FTC on a

"voluntary program" to like effect. Letter from Horace R.

Kornegay, President, The Tobacco Institute, Inc., to Fed. Trade

Comm'n (Dec. 17, 1970). By agreeing to the program, however, the

manufacturers did not "admit that the failure affirmatively to

disclose" the test results in their advertising "constitutes a

violation of law," or even that the FTC had the authority to enact

the proposed rule. Id. The FTC, for its part, took the position

that it "retained the unconditional right to reschedule the . . .

Rule proceeding and to take any other action relating to this

subject at any time . . . ." 36 Fed. Reg. 784 (Jan. 16, 1971).

Since then, the FTC has neither resumed the rulemaking

proceedings suspended by its agreement with the cigarette

manufacturers, nor promulgated any formal rule requiring them to

disclose the tar or nicotine content of their products. In 1987,

the FTC stopped conducting its own tests of cigarettes. The

testing continued, however, under the auspices of the Tobacco

Institute Testing Laboratory, operated by the major American

cigarette manufacturers. The manufacturers agreed to allow the 5
The FTC continued to collect the test results, at least through 6

2002, but has stopped reporting them, for reasons that are unclear

from the record. The FTC has, however, made the results for the

years 1999 through 2002 available in response to requests under the

Freedom of Information Act, 5 U.S.C. § 552 (2007). Fed. Trade

Comm'n, Cigarette Tar, Nicotine and Carbon Monoxide Yields Produced

by Cigarette Manufacturers for the Years 1999-2002, available at

http://www.ftc.gov/foia/frequentrequest.shtm.

-8-

FTC to monitor the lab's procedures, which included the use of the

Cambridge Filter Method. The FTC has obtained the test results

from the individual manufacturers through its compulsory process

authority, see 15 U.S.C. § 46(b), and reported those results to

Congress for each year through 1998.6

Based on this regime, Philip Morris characterized the

lawsuit as "a challenge to the FTC's regulatory scheme," because

"terms like 'light' and 'lowered tar' . . . convey precisely the

same comparative information" as the tar and nicotine measurements

derived from testing under the Cambridge Filter Method. The

district court agreed, reasoning that

To respond to Plaintiffs' claims, Philip Morris would

have to tell the public that the FTC Method test, though

accurate in the laboratory, was inaccurate in real life,

and that light cigarette smokers . . . infused greater

amounts of nicotine and tar than the designation 'Lights'

and 'Lowered Tar and Nicotine' would imply. But, this

information, if conveyed through a form of advertising,

would run head first into . . . the comprehensive federal

scheme governing the advertising and promotion of

cigarettes. 

436 F. Supp. 2d at 152 (internal quotation marks omitted). Finding

the plaintiffs' claims thus "grounded on Philip Morris's

'advertising or promotion of . . . cigarettes labeled in conformity
Each side also asked the district court to strike certain 7

evidentiary materials or statements of fact submitted in connection

with the motion for summary judgment. Some of these requests were

denied and some were granted, but none of the district court's

rulings in this regard have been questioned on appeal.

-9-

with the provisions of' federal law and regulation," the district

court concluded that they were expressly preempted by the FCLAA.

Id. at 153 (quoting 15 U.S.C. § 1334(b)). The court did not decide

Philip Morris's alternative arguments for summary judgment. Id. 7

at 133 n.1. This appeal followed.

II.

The plaintiffs challenge the ruling below as at odds with

Cipollone v. Liggett Group, Inc., 505 U.S. 504 (1992), where a

plurality of the Supreme Court held that some--but not all--actions

for damages under state law are expressly preempted by the FCLAA.

Id. at 523-24. In response, Philip Morris argues that the district

court correctly found the plaintiffs' claims preempted under

Cipollone. Philip Morris simultaneously urges us to affirm the

entry of summary judgment in its favor on the alternative grounds

not reached below, namely, that the plaintiffs' claims are

implicitly preempted by federal law or that they complain of

"actions otherwise permitted under laws" and therefore cannot serve

as the basis for liability under the Maine Unfair Trade Practices

Act. We review these arguments de novo. See Philip Morris Inc. v.

Harshbarger, 122 F.3d 58, 62 (1st Cir. 1997).
-10-

A.

"A fundamental tenet of our federalist system is that

constitutionally enacted federal law is supreme to state law. As

a result, federal law sometimes preempts state law either expressly

or by implication." N.H. Motor Transport Ass'n v. Rowe, 448 F.3d

66, 74 (1st Cir. 2006) (citation omitted), cert. granted, 127 S.

Ct. 3037 (2007). Preemption questions ultimately turn on

congressional intent, e.g., Cipollone, 505 U.S. at 516, and the

primary indicator of that intent is the text of the congressional

act claimed to have preemptive effect, e.g., Engine Mfrs. Ass'n v.

S. Coast Air Quality Mgmt. Dist., 541 U.S. 246, 252 (2004). But

"[t]he text of the preemption provision must be viewed in context,

with proper attention paid to the history, structure, and purpose

of the legislative scheme in which it appears." Lorillard Tobacco

Co. v. Reilly, 533 U.S. 525, 591 (2001).

1.

As noted at the outset, the FCLAA's preemption clause

states that "[n]o requirement or prohibition based on smoking and

health shall be imposed under State law with respect to the

advertising or promotion of any cigarettes the packages of which

are labeled in conformity with the provisions of this chapter." 15

U.S.C. § 1334(b). Those provisions mandate that the packages of

all cigarettes sold in the United States--and, in general, their

advertisements--bear one of a rotating series of labels warning
These labels are the now-familiar "Surgeon General's Warning" 8

statements, e.g., "Smoking Causes Lung Cancer, Heart Disease,

Emphysema, and May Complicate Pregnancy."

-11-

about the adverse health effects of smoking. Id. §§ 1333(a), (c). 8

But no additional "statement relating to smoking and health . . .

shall be required on any cigarette package." Id. § 1334(a). The

FCLAA also bans cigarette advertising "on any medium of electronic

communication subject to the jurisdiction of the Federal

Communications Commission," id. § 1335, and preserves the authority

of the FTC over "unfair or deceptive acts or practices in the

advertising of cigarettes," id. § 1336.

These provisions were added to the FCLAA through the

Public Health Cigarette Smoking Act of 1969, Pub. L. 91-222, 84

Stat. 87-90, enacted as the restrictions on cigarette advertising

contained in the prior version of the FCLAA were set to expire.

Pub. L. 89-92 § 10, 79 Stat. 282, 285 (1965). As the expiration

date approached, both federal and state authorities prepared to

resume their efforts to regulate cigarette advertising. See

Cipollone, 505 U.S. at 514-15. Thus, Congress amended the FCLAA

to establish a comprehensive Federal program to deal with

cigarette labeling and advertising with respect to any

relationship between smoking and health, whereby--

(1) the public may be adequately informed about any

adverse health effects of cigarette smoking by inclusion of

warning notices on each package of cigarettes and in each

advertisement of cigarettes; and

(2) commerce and the national economy may be (A)

protected to the maximum extent consistent with this declared
-12-

policy and (B) not impeded by diverse, nonuniform, and

confusing cigarette labeling and advertising regulations with

respect to any relationship between smoking and health.

15 U.S.C. § 1331.

With these purposes in mind, the Cipollone Court

considered whether the FCLAA's preemption clause barred a state-law

suit for damages brought by a smoker who had allegedly developed

lung cancer from the defendants' cigarettes. 505 U.S. at 509-10.

The smoker asserted a number of common law causes of action,

including strict liability, negligent failure to warn, breach of

express warranty, fraudulent misrepresentation, and civil

conspiracy. Id. The court of appeals held that, while § 1334(b)

did not expressly preempt common law claims, the FCLAA's labeling

requirement "revealed a congressional intent to exert exclusive

federal control over every aspect of the relationship between

cigarettes and health." Id. at 517. Accordingly, the court of

appeals ruled that the plaintiff's claims "challenging the adequacy

of the warnings on labels or in advertising or the propriety of

[the defendants'] advertising and promotional activities" were

implicitly preempted. Id.

A plurality of the Court disagreed with this analysis,

holding that "the pre-emptive scope of the [FCLAA] is governed

entirely by the express language in [§ 1334(b)]," id., which did,

in fact, reach some common law actions. Id. at 521-23. But

because "[f]or purposes of [§ 1334(b)], the common law is not of a
-13-

piece," the plurality explained that it had to "look to each of

[the smoker's] common-law claims to determine whether it is in fact

pre-empted." Id. at 523 (footnote omitted). This approach

required the plurality to

ask whether the legal duty that is the predicate of the

common-law damages action constitutes a "requirement or

prohibition based on smoking or health . . . imposed

under State law with respect to advertising or promotion,

giving that clause a fair but narrow reading . . . .

[E]ach phrase within that clause limits the universe of

common-law claims pre-empted by the statute.

Id. at 524 (quoting 15 U.S.C. § 1334(b)). Employing this analysis,

the plurality determined that the FCLAA preempted the claim,

pleaded as a failure to warn, that the defendants' "advertising and

promotions should have included additional, or more clearly stated

warnings," because it relied on "a state-law 'requirement or

prohibition . . . with respect to . . . advertising or promotion.'"

Id. (quoting 15 U.S.C. § 1334(b)).

The plurality proceeded to consider the smoker's two

theories of fraudulent misrepresentation. The first, that the

defendants, "through their advertising, neutralized the effect of

federally mandated warning labels," was preempted by the FCLAA.

Id. at 527. As the plurality explained, this theory was

"predicated on a state-law prohibition against statements in

advertising and promotional materials that tend to minimize the

health hazards of smoking," which is itself "merely the converse of

a state-law requirement that warnings be included in [such]
-14-

materials." Id. This fraudulent misrepresentation claim, then,

was "inextricably related to" the failure-to-warn claim and

therefore also premised on a "requirement or prohibition based on

smoking and health" imposed by state law. Id. at 528.

But the plurality reached a different conclusion as to

the smoker's second fraudulent misrepresentation theory:

"intentional fraud and false misrepresentation both by false

misrepresentation of a material fact and by concealment of a

material fact." Id. (internal quotation marks and bracketing

omitted). First, the plurality held that the FCLAA does not

preempt fraudulent concealment claims that "rely on a state-law

duty to disclose such facts through channels of communication other

than advertising or promotion," e.g., in the case of a state law

requiring cigarette manufacturers "to disclose material facts about

smoking and health to an administrative agency." Id. Second, the

plurality held that

fraudulent-misrepresentation claims that do arise with

respect to advertising and promotion (most notably claims

based on allegedly false statements of material fact made

in advertisements) are not pre-empted by [§ 1334(b)].

Such claims are predicated not on a duty "based on

smoking and health" but rather on a more general

obligation--the duty not to deceive.

Id. at 528-29. The plurality saw this result as consistent with

the text, structure, and purpose of the FCLAA. Id. at 529. First,

the FCLAA "offered no sign that [Congress] wished to insulate

manufacturers from longstanding rules governing fraud"--in fact,
From this point on, then, we will refer to the plurality opinion 9

as simply "Cipollone," except when necessary to contrast the views

of the dissenting opinion with those of the plurality.

-15-

the Act "explicitly reserved the FTC's authority to identify and

punish deceptive advertising practices . . . ." Id. Second,

reading § 1334(b) to exclude fraud claims would not frustrate the

FCLAA's stated goal of protecting commerce from "diverse,

nonuniform, and confusing cigarette labeling and advertising

regulations with respect to any relationship between smoking and

health," 15 U.S.C. § 1331(2), because "state-law proscriptions on

intentional fraud rely only on a single, uniform standard:

falsity." 505 U.S. at 529.

This analysis of the FCLAA's effect on the smoker's

claims held sway with only four of the Court's nine Justices. Two

others joined Justice Blackmun's opinion that the FCLAA did not

preempt any common law claims for damages, id. at 531, while

another joined Justice Scalia's opinion that § 1334(b) preempted

all of the smoker's common law theories. Id. at 548. Most lower

courts have nevertheless treated the plurality opinion as

controlling, see Brown v. Brown & Williamson Tobacco Corp., 479

F.3d 383, 389 (5th Cir. 2007) (collecting cases), as have the

parties here, both on appeal and in the district court, 436 F.

Supp. 2d at 142. We therefore do the same. Cf. Harshbarger, 122 9

F.3d at 69-77 (reconciling opinions of plurality and Justice Scalia
-16-

in Cipollone insofar as possible but following the plurality

opinion in case of disagreement between them).

2.

The parties agree that whether the FCLAA expressly

preempts the plaintiffs' claims depends on how best to categorize

them by analogy to the various causes of action considered in

Cipollone. In doing so, as the district court recognized, 436 F.

Supp. 2d at 151, we must look beyond the plaintiffs' own

classification of their claims and to their actual substance. See

Kirksey v. R.J. Reynolds Tobacco Co., 168 F.3d 1039, 1043 (7th Cir.

1999); accord Danca v. Private Health Care Sys., Inc., 185 F.3d 1,

5 (1st Cir. 1999) (endorsing the same approach in deciding whether

ERISA preempts particular state-law claims).

The plaintiffs seek relief under the Maine Unfair Trade

Practices Act, which, in relevant part, outlaws "unfair or

deceptive acts or practices in the conduct of any trade or

commerce." Me. Rev. Stat. Ann. tit. 5, § 207. Though this

prohibition encompasses various kinds of behavior, including "a

material representation, omission, act or practice that is likely

to mislead consumers acting reasonably under the circumstances,"

Maine v. Weinschenk, 868 A.2d 200, 206 (Me. 2005), the substance of

the plaintiffs' claim is that Philip Morris has falsely represented

certain of its brands as "light" or having "lower tar and nicotine"

although they deliver the same quantities of these ingredients to
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a smoker as do "full-flavored" cigarettes. So, under the

functional approach, we consider how this particular theory--as

opposed to a more generalized claim under the Maine Unfair Trade

Practices Act--resembles the various common-law causes of action

considered in Cippolone. If, as the plaintiffs argue, they have

indeed alleged fraudulent misrepresentation claims, the claims are

not preempted because, as Cipollone explains, they are not premised

on a state-law duty based on smoking and health. But if, as Philip

Morris argues, the plaintiffs have in reality alleged failure-towarn or warning neutralization claims, the claims are preempted.

While the district court stopped short of assigning a

specific label to the plaintiffs' claims, its reasoning suggests

that it considered them analogous to the failure-to-warn theory

held preempted by Cipollone. The court opined that the plaintiffs

had failed in their "valiant attempt to tailor their claims to fit

within the Cipollone exception for violations of the duty not to

deceive . . . ." 436 F. Supp. 2d at 151. Instead, the district

court identified "the gist of the Plaintiffs' cause of action" as

dependent on "what Philip Morris actually said about Lights and

what the Plaintiffs claim [it] should have said." Id. (emphasis

added). And what Philip Morris "should have said," the court

understood the plaintiffs to assert, was that Marlboro Lights and

Cambridge Lights deliver more tar and nicotine to an actual smoker

than "the designation 'Lights' and 'Lowered Tar and Nicotine' would
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imply." Id. at 152. Because doing so would require Philip Morris

to alter its advertising or promotion of its cigarettes, the

district court concluded, the plaintiffs' claims were expressly

preempted by the FCLAA as construed by Cipollone.

We differ with the district court's view of the fit

between the plaintiffs' theory and the Cipollone taxonomy and, more

fundamentally, of Cipollone itself. To start, we do not read

Cipollone to hold that the FCLAA preempts claims "grounded on [a

defendant's] 'advertising or promotion of . . . cigarettes labeled

in conformity with the provisions of' federal law and regulation,"

as the district court ultimately explained its conclusion. 436 F.

Supp. 2d at 153 (quoting 15 U.S.C. § 1334(b)). Cipollone reasoned

that "each phrase" in § 1334(b)--not just the phrase "with respect

to the advertising or promotion of any cigarettes"--"limits the

universe of common-law claims pre-empted by the statute." 505 U.S.

at 524. So "[t]he appropriate inquiry is not whether a claim

challenges the 'propriety' of advertising and promotion, but

whether the claim would require the imposition under state law of

a requirement or prohibition based on smoking and health with

respect to advertising and promotion." Id. at 525. A claim is not

preempted, then, merely because it is "grounded on" the advertising

or promotion of cigarettes with FCLAA-compliant labels.

Nor is a claim preempted merely because it arises out of

the adverse health consequences of such cigarettes, as both the
In doing so, the Court also overturned the ruling of the court of 10

appeals that the FCLAA, which "revealed a congressional intent to

exert exclusive federal control over every aspect of the

relationship between cigarettes and health," preempted all of the

smoker's claims. 505 U.S. at 517. 

-19-

reasoning and the result in Cipollone make clear. There, in fact,

all of the plaintiff's claims were "based on smoking and health" in

the sense that they "alleged that [she] developed lung cancer

because she smoked cigarettes," 505 U.S. at 509, yet the Court held

that the FCLAA preempted only some of them. And the fate of each 10

claim depended on "whether the legal duty that is the predicate of

the common-law damages action"--not the claim itself--met the

criteria of § 1334(b). Id. at 524. Thus, for example, while the

theory that the defendants in Cipollone "had expressly warranted

that smoking the cigarettes which they manufactured and sold did

not present any significant health consequences," id. at 509

(internal quotation marks omitted), was clearly based on smoking

and health, it was not preempted because "it [did] not rest on a

duty imposed under state law," but on the defendants' own

"contractual commitment voluntarily undertaken," i.e., the

warranty. Id. at 526. Accordingly, the FCLAA preempts only those

claims based on a "requirement or prohibition based on smoking and

health under State law with respect to the advertising or promotion

of any cigarettes the packages of which are labeled in accordance
Indeed, this was one of the primary points of disagreement between 11

the Cipollone plurality and Justice Scalia, who argued in dissent

that questions of FCLAA preemption "must focus not upon the

ultimate source of the duty (e.g., the common law) but upon its

proximate application." 505 U.S. at 553. This "'proximate

application' methodology for determining whether [claims] invoke

duties 'based on smoking and health' . . . would ask . . . whether,

whatever the source of the duty, it imposes an obligation in this

case because of the effect of smoking upon health." Id. at 554

(emphasis added). While conceding the "theoretical attraction" of

this argument, the plurality rejected it as at odds with "a fair

understanding of [the] congressional purpose" behind the FCLAA.

Id. at 529 n.27. This exchange further solidifies our view that

the FCLAA preempts claims predicated on a state-law duty, with

respect to advertising and promotion, which is itself based on

smoking and health--not "claims based on smoking and health."

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with" the FCLAA. 15 U.S.C. § 1334(b) (emphasis added). It does

not preempt claims because they are "based on smoking and health."11

Furthermore, unlike Philip Morris, we do not read the

Court's subsequent decision in Reilly to suggest that the statute's

preemptive effect on a claim depends on the claim's connection with

"smoking and health." In Reilly, the Court held that § 1334(b)

preempted regulations on tobacco advertising promulgated by the

Massachusetts Attorney General pursuant to his authority under that

state's counterpart to the Maine Unfair Trade Practices Act, Mass.

Gen. Laws ch. 93A. 533 U.S. at 533. Though their stated purpose

was "to address the incidence of cigarette smoking . . . by

children under legal age," id. (internal quotation marks omitted),

the Court rejected the notion that the regulations were "not 'based

on smoking and health' because they do not involve health-related

content in cigarette advertising but instead target youth exposure
-21-

to cigarette advertising." Id. at 547. Noting that the FCLAA

"prohibited state cigarette advertising regulations motivated by

concerns about smoking and health," the Court reasoned that "[a]t

bottom, the concern about youth cigarette advertising is

intertwined with" such concerns, bringing the regulations within

the preemptive sweep of the FCLAA. Id. at 548. 

Philip Morris urges us to draw an analogy between the

regulations found preempted in Reilly and the claims of the

plaintiffs here, arguing that, in either case, a state consumer

protection act is used "to create requirements or prohibitions

regarding advertisements and promotions that are intertwined with

the concern about cigarette smoking and health" (internal quotation

marks omitted). But this argument again confuses the claim at hand

with its predicate state-law duty as the relevant "requirement or

prohibition" under § 1334(b). The plaintiffs' claims are indeed

"intertwined with the concern about cigarette smoking and health,"

just as surely as the regulations in Reilly were; the difference,

however, is that those regulations were themselves the

"prohibitions," while the prohibition here is the ban on "unfair or

deceptive acts or practices in the conduct of any trade or

commerce" under the Maine Unfair Trade Practices Act. And

Cipollone, as we have noted, treats a state-law "duty not to

deceive" as broader than a "duty 'based on smoking and health'" and
Indeed, Reilly notes that "Members of this Court have debated the 12

precise meaning of 'based on smoking and health,'" citing to the

footnote in Cipollone--referenced here at note 11, supra--where the

plurality rejects the views of the concurring and dissenting

opinions on that point. 546 U.S. at 547. But Reilly does not

purport to resolve the debate and, aside from its holding that the

phrase embraces regulations directed at youth exposure to cigarette

advertising, does not explore the issue any further. See id.

Philip Morris relies on a recent decision of the California 13

Supreme Court, In re Tobacco Cases II, Cal. Rptr. 3d , No.

S129522, 2007 WL 2199006 (Cal. Aug. 2, 2007), for the proposition

that "If the theory is based on smoking and health, the claim is

preempted." Though the decision arguably contains some language to

that effect, its holding is simply that § 1334(b) preempts the

claim that Philip Morris violated California's unfair competition

law by targeting minors with its advertising--a holding, as the

-22-

therefore beyond the reach of FCLAA preemption. 505 U.S. at 529-30

(quoting 15 U.S.C. § 1334(b)).

We see nothing in Reilly suggesting any intent to disturb

this aspect of the Cipollone plurality holding. Nor do we see any 12

internal inconsistency in the view that the phrase "based on

smoking and health" includes state-law prohibitions on cigarette

ads targeting youths, Reilly, 533 U.S. at 448, but excludes state

prohibitions on cigarette ads making false statements of material

fact, Cippolone, 505 U.S. at 524. Accordingly, we agree with those

courts that have rejected the notion that the FCLAA preempts claims

"intertwined with the concern about smoking and health" but

nevertheless premised on a state-law duty that is broader in scope.

See Mulford v. Altria Group, Inc., No. 05-659, 2007 WL 1969734, at

*18 (D.N.M. Mar. 16, 2007); Gerrity v. R.J. Reynolds Tobacco Co.,

399 F. Supp. 2d 87, 95 (D. Conn. 2005).13
court noted, that was ordained by Reilly. Id. at *9. Again, we do

not perceive any tension between this result and our understanding

of Cipollone. Indeed, the California Supreme Court observed that

the FCLAA would not preempt a state unfair competition claim "that

sought to impose only content-neutral restrictions on cigarette

advertising--such as a requirement that the advertising not contain

false statements of fact--that were unrelated to smoking and

health." Id. In re Tobacco Cases II, then, ultimately does not

support Philip Morris's position. And to the extent that the case

might arguably be read more broadly, we respectfully disagree with

it for the reasons set forth at length in the text of this opinion.

-23-

Because the state-law "duty not to deceive" is one such

"more general obligation," it falls within Cipollone's express

holding that "claims based on allegedly false statements of

material fact made in advertisements" survive FCLAA preemption.

505 U.S. at 528-29. In line with this holding, courts have

routinely (though not uniformly) concluded that the FCLAA does not

preempt fraudulent misrepresentation claims arising out of false

statements made in advertising or promoting cigarettes. See, e.g.,

Spain v. Brown & Williamson Tobacco Co., 363 F.3d 1183, 1202 (11th

Cir. 2004); Mulford, 2007 WL 1969734, at *16; Blue Cross & Blue

Shield of N.J., Inc. v. Philip Morris, Inc., 178 F. Supp. 2d 198,

216 & 264-65 (E.D.N.Y. 2000), aff'd in relevant part, 344 F.3d 211,

222 (2d Cir. 2003); Johnson v. Brown & Williamson Tobacco Corp.,

122 F. Supp. 2d 194, 203 (D. Mass. 2000); Izzarelli v. R.J.

Reynolds Tobacco Co., 117 F. Supp. 2d 167, 175 (D. Conn. 2000);

Hyde v. Philip Morris, Inc., No. 97-0359, 1998 WL 656074, at *6

(D.R.I. May 1, 1998); Whiteley v. Philip Morris Inc., 11 Cal. Rptr.

3d 807, 842 (Cal. Ct. App. 2004); Price v. Philip Morris, Inc., 848
We note that these proceedings--which we henceforth refer to as 14

"In re Tobacco Cases II"--are not the same as the In re Tobacco

Cases II discussed in note 13, supra. 

-24-

N.E.2d 1, 33 (Ill. 2005); Small v. Lorillard Tobacco Co., 679

N.Y.S.2d 593, 603-604 (N.Y. App. Div. 1998); Est. of Schwarz v.

Philip Morris Inc., 135 P.3d 409, 421 (Or. Ct. App. 2006) (en

banc); but see In re Tobacco Cases II, No. JCCP 4042, 2004 WL

2445337, at *19-*22 (Cal. Super. Ct. Aug. 4, 2004), aff'd sub nom.

In re Tobacco II Cases, 47 Cal. Rptr. 3d 917 (Cal. Ct. App.), rev.

granted, 146 P.3d 1250 (Cal. 2006) ; Dahl v. R.J. Reynolds Tobacco 14

Co., No. 03-5582, 2005 WL 1172019, at *10-*12 (Minn. Dist. Ct. May

11, 2005); Am. Tobacco Co. v. Grinnell, 951 S.W.2d 420, 440 (Tex.

1997). A number of these decisions, in fact, hold that the FCLAA

does not preempt the very theory the plaintiffs advance here--that

a cigarette manufacturer has perpetrated fraud by stating that its

light brand offers lower tar and nicotine than its full-flavored

one. See Mulford, 2007 WL 1969734, at *19; Price, 848 N.E.2d at

33; Est. of Schwarz, 135 P.3d at 421; but see Brown, 479 F.3d at

391-93; Clinton v. Brown & Williamson Tobacco Co., F. Supp. 2d

 , No. 05 Civ. 9907, 2007 WL 2181896, at *11 (S.D.N.Y. July 23,

2007); In re Tobacco Cases II, 2004 WL 2445337, at *19-*21; Dahl,

2005 WL 117290, at *11.

The district court saw the plaintiffs' case differently,

observing that "[o]ther than these descriptors" (i.e., the "light"

and "lower tar and nicotine" claims) "the record here is devoid of
-25-

any affirmative misstatement." 436 F. Supp. 2d at 152 (footnote

omitted). Based on this reasoning, Philip Morris argues that the

district court properly treated the plaintiffs' claims as "based on

implied misrepresentations about health," which qualify as

preempted failure-to-warn or warning neutralization claims, rather

than non-preempted fraudulent misrepresentation claims, which arise

out of only "express" misrepresentations. We disagree.

First, we question the conclusion that, although the

descriptors are themselves characterized as affirmative

misstatements, they cannot ground a fraudulent misrepresentation

claim left unscathed by Cipollone's reading of the FCLAA. The

district court appears to have based its conclusion on its

understanding that, despite the popularity of the terms "light" and

"lower tar and nicotine" in cigarette advertising, "Congress and

the FTC never acted to restrict the tobacco companies from using

these general descriptors." 436 F. Supp. 2d at 152; see also

Clinton, slip op. at 22 (finding fraudulent misrepresentation claim

arising out of descriptors expressly preempted because "the FTC has

declined to disallow those terms despite several invitations to do

so"). But whatever support this might lend to an argument for

implied preemption of state law--and we consider that question in

detail infra--it provides little guidance in applying the express

preemption provision of the FCLAA, the scope of which "is governed
Philip Morris questions the vitality of this holding in light of 15

subsequent Supreme Court cases on the preemptive effect of other

federal statutory provisions. In Part II.B, infra, we consider,

and reject, this argument.

-26-

entirely by the express language in" § 1334(b). Cipollone, 505 15

U.S. at 517. Cipollone read this language to preserve state-law

claims based on allegedly fraudulent statements in advertising and

promotion, without regard to whether Congress or the FTC had

separately acted to prohibit particular examples of them.

Cipollone arrived at this interpretation in part because,

in the FCLAA, "Congress offered no sign that it wished to insulate

cigarette manufacturers from longstanding rules governing fraud."

Id. at 529. So if its inaction since has any significance--and we

usually hesitate to make much ado about congressional nothing, see,

e.g., Estey v. Comm'r, Me. Dep't of Human Servs., 21 F.3d 1198,

1206 (1st Cir. 1994)--it could just as likely be that Congress

chose not to regulate the descriptors because it believed the

generalized state-law prohibitions on fraud left in place under the

FCLAA adequately protected smokers against false claims to lower

tar and nicotine, and not because it viewed such claims as

permissible. But, in either case, what Congress thinks of "light"

and "lower tar and nicotine" advertisements in general simply does

not speak to whether, in enacting the FCLAA, Congress intended to

preempt state lawsuits challenging them. The answer to that

question, as Cipollone makes clear, lies in § 1334(b). 
-27-

Second, Cipollone does not appear to treat claims based

on "implied" as opposed to "express" misrepresentations differently

for purposes of FCLAA preemption. Under general principles of tort

law, either an express or an implied statement can give rise to a

claim for fraudulent misrepresentation. See Restatement (Second)

of Torts § 526(c) (1977); accord Est. of Whitlock, 615 A.2d 1173,

1176 (Me. 1992). And Cipollone flatly holds that "fraudulentmisrepresentation claims that do arise with respect to advertising

and promotion (most notably claims based on allegedly false

statements of material fact made in advertisements)" are not

preempted, without drawing any distinction between the express and

the implied. 505 U.S. at 528-29. Indeed, in either case, the

claim is "predicated not on a duty 'based on smoking and health'

but on a more general obligation--the duty not to deceive." Id.

The "express" or "implied" nature of an allegedly fraudulent

misrepresentation, then, does not determine whether it is preempted

by the FCLAA under the Cipollone approach. See Mulford, 2007 WL

1969734, at *17 (rejecting distinction, for purposes of FCLAA

preemption, between fraud claim arising out of statements "light"

and "Lowered Tar and Nicotine," and statement "Smoking cures

cancer," which Philip Morris had proffered as a counterexample of

"express," as opposed to "implied," misrepresentation). 

Cipollone does set up a dichotomy between fraud "by false

representation of a material fact," on one hand, and "by
While the amended complaint includes allegations of fraudulent 16

concealment, we read them to assert a basis for tolling the statute

of limitations on the plaintiffs' claims for relief, not a theory

of recovery in their own right. Philip Morris does not argue that,

to the extent § 1334(b) preempts fraudulent concealment claims, it

also forecloses the use of that doctrine to toll the limitations

period on a state-law claim that is otherwise not preempted, so we

do not consider any such argument.

-28-

concealment of a material fact," on the other. 505 U.S. at 528

(internal quotation marks and bracketing omitted). As just

discussed, the FCLAA does not preempt claims of the former;

Cipollone holds that claims for the latter also survive preemption

"insofar as those claims rely on a state-law duty to disclose such

facts through channels of communication other than advertising or

promotion," such as, for example, a state-law duty "to disclose

such facts to an administrative agency." Id. We need not concern

ourselves with Cipollone's holding on the reach of § 1334(b) over

fraudulent concealment claims, however, because the plaintiffs

have not brought any. Instead, they allege that Philip Morris 16

made material statements of fact that it knew to be false--"that

Marlboro Lights and Cambridge Lights cigarettes are 'light' or have

'lower tar and nicotine'"--to encourage smokers to purchase its

products, and that smokers did so in reliance on those statements.

These allegations state a claim for fraudulent misrepresentation.

See Restatement (Second) of Torts § 525 (1977); accord, e.g., St.

Francis De Sales Fed. Credit Union v. Sun Ins. Co. of N.Y., 818

A.2d 995, 1003-04 (Me. 2003). Unlike the district court, then, we
-29-

do not see the plaintiffs' claims as arising out of what Philip

Morris "should have said," but rather, what it did in fact say:

that Marlboro Lights and Cambridge Lights have "lower tar and

nicotine" than their full-flavored counterparts.

Philip Morris nevertheless insists that this theory

amounts to a preempted failure-to-warn claim, "[b]ecause any false

impression that the descriptors allegedly created would have been

eliminated if [Philip Morris] had provided additional health

information regarding compensation," that is, a smoker's tendency

to take in the same harmful quantities of tar and nicotine from

light cigarettes as from regular ones. We accept, for present

purposes, that the plaintiffs could not claim to have been

defrauded by the statements "light" and "lower tar and nicotine" in

Philip Morris's advertising and promotion if they were accompanied

by a specific warning about compensation. And we agree that, if

the plaintiffs were claiming that the failure to give such a

warning through those media was a breach of Philip Morris's duty

under Maine law, the FCLAA would preempt that claim as "rely[ing]

on a state-law requirement or prohibition with respect to

advertising or promotion." Cipollone, 505 U.S. at 524 (internal

quotation marks and ellipses omitted). But that is not the

plaintiffs' claim. Again, they allege that Philip Morris made

fraudulent misrepresentations in derogation of "a more general

obligation--the duty not to deceive." Id. at 528-29.
While Justice Scalia agreed with the plurality's conclusion that 17

§ 1334(b) preempts failure-to-warn claims unless they are based on

a duty to make disclosures outside of advertising or promotion, he

disagreed with the implication that the FCLAA's preemptive effect

extends to state laws only insofar as they specify that warnings be

provided through advertising or promotion. 505 U.S. at 554-55.

Instead, Justice Scalia posited that "[t]he test for pre-emption in

this setting should be one of practical compulsion, i.e., whether

the law practically compels the manufacturers to engage in behavior

that Congress has barred the States from prescribing directly."

Id. at 555. Under this test, § 1334(b) would preempt state law

that "requires manufacturers to advise consumers of their products'

dangers, but . . . is indifferent to how that requirement is met,"

-30-

The fact that these alleged misrepresentations were

unaccompanied by additional statements in the nature of a warning

does not transform the claimed fraud into failure to warn. Indeed,

we have trouble imagining any misrepresentation claim wholly

independent of what else the defendant said or did not say, given

the "well-established principle that a statement or omission must

be considered in context, so that accompanying statements may

render it immaterial as a matter of law." In re Donald J. Trump

Casino Sec. Litig., 7 F.3d 357, 364 (3d Cir. 1993) (adopting

"bespeaks caution" doctrine in federal securities fraud context);

accord, e.g., Rodi v. S. New Eng. Sch. of Law, 389 F.3d 5, 16-17

(1st Cir. 2004) (considering effect of disclaimer on plaintiff's

ability to show reasonable reliance on false statement). Accepting

Philip Morris's argument, then, would extend the preemptive reach

of the FCLAA to virtually all fraudulent misrepresentation claims,

doing violence to Cipollone's explicit holding that those claims

survive preemption.17
because, as a practical matter, such a law will compel tobacco

companies to include those warnings in its advertisements or

promotions. Id. at 554-55. Courts that have treated fraud claims

arising out of the statements "light" and "lower tar and nicotine"

as failure-to-warn claims--including the district court here--tend

to rely on a form of Justice Scalia's "practical compulsion" test.

See, e.g., 436 F. Supp. 2d at 152 (reasoning that any warning

about compensation, "if conveyed through a form of advertising,

would run head first into what Reilly describes as the

comprehensive federal scheme governing the advertising and

promotion of cigarettes") (internal quotation marks omitted); see

also Brown, 489 F.3d at 392-93; In re Tobacco Cases II, 2004 WL

2445337, at *21; Dahl, 2005 WL 1172019, at *11. But because the

Cipollone plurality did not adopt Justice Scalia's method of

analyzing failure-to-warn claims, 505 U.S. at 524-25, that a

lawsuit might compel a manufacturer to alter its advertising does

not mean the suit is preempted by the FCLAA.

-31-

Moreover, Cipollone itself conceived of failure-to-warn

claims much more narrowly than Philip Morris does, describing them

to "require a showing that . . . advertising or promotions should

have included additional, or more clearly stated warnings." Id.

524 (emphasis added). Because the plaintiffs' chosen theory of

recovery requires no such showing, theirs is not a preempted

failure-to-warn claim, as a number of courts have concluded in

rejecting similar arguments. See Mulford, 2007 WL 1969734, at *17;

Schwab v. Philip Morris USA, Inc., 449 F. Supp. 2d 992, 1294-95

(E.D.N.Y. 2006), pet. for rev. of class certification granted sub

nom. McLaughlin v. Philip Morris USA, Inc., No. 06-4666 (2d Cir.

Nov. 16, 2006); Izzarelli, 117 F. Supp. 2d at 175; Price, 848

N.E.2d at 33; Est. of Schwarz, 135 P.3d at 421.

For the same reason, we do not see the plaintiffs' claims

as embracing a preempted warning neutralization theory. Warning
-32-

neutralization is a species of products liability claim based on

conduct by the manufacturer tending to dilute what might otherwise

serve as an effective warning of the dangers of its product. See,

e.g., McNeil v. Wyeth, 462 F.3d 364, 368 n.4 (5th Cir. 2006); Hon

v. Stroh Brewery Co., 835 F.2d 510, 514-15 (3d Cir. 1987); 2 Louis

R. Frumer & Melvin I. Friedman, Products Liability § 12.03[2][e],

at 12-61--12-62 (1960 & 2003 supp.). As an example, Cipollone

cited "advertising that 'associated cigarette smoking with such

positive attributes as contentment, glamour, romance, youth,

happiness,'" noting the FTC's 1964 conclusion that "'[t]o avoid

giving the false impression that cigarette smoking is innocuous,'"

such advertising "'must also disclose the serious risks to life

that smoking involves.'" 505 U.S. at 527 (quoting 29 Fed. Reg.

8356 (1964)). In light of this "relationship between prohibitions

on advertising that downplays the dangers of smoking and

requirements for warnings in advertisements," id., Cipollone

considered the plaintiff's warning neutralization claim

"inextricably related to [her] failure-to-warn claim" and likewise

preempted. Id. at 528.

The plaintiffs here, however, do not allege that the

statements "light" and "lower tar and nicotine" diluted the

warnings on Philip Morris's packaging or advertising so as to make

its cigarettes unreasonably dangerous or otherwise defective.

Instead, the plaintiffs allege that the statements deceived them
-33-

into purchasing Marlboro Lights and Cambridge Lights. The presence

of the warnings may have some bearing on the materiality of these

statements, as just discussed, but that possibility does not

change the plaintiffs' case from one about the statements into one

about the warnings. As one court has put it, because "[a]ny

statement, even affirmatively false misrepresentations about the

health effects of smoking, may have some neutralizing effect on the

package warning . . . , the concept of neutralization could preempt

virtually all affirmative fraud claims" if viewed as expansively as

Philip Morris urges. Whiteley, 11 Cal. Rptr. 3d at 837. We, too,

reject that expansive view as irreconcilable with the different

treatment Cipollone accords warning neutralization claims, on one

hand, and fraudulent misrepresentation claims, on the other. See

also Mulford, 2007 WL 1969734, at *17; Izzarelli, 177 F. Supp. 2d

at 175; Price, 848 N.E.2d at 33; DaSilva v. Am. Tobacco Co., 667

N.Y.S.2d 653, 656 (N.Y. Sup. Ct. 1997); Est. of Schwarz, 135 P.3d

at 421.

We acknowledge that the Fifth Circuit came to the

opposite conclusion in Brown, ruling that fraudulent

misrepresentation claims arising out of the statements "light" and

"Lowered Tar and Nicotine" are in effect warning neutralization

claims preempted by § 1334(b). 479 F.3d at 392-93; accord In re

Tobacco Cases II, 2004 WL 2445337, at *21; Dahl, 2005 WL 1172019,

at *7-*8. Taking the plaintiffs there to allege that "the
Furthermore, we reiterate our views that Cipollone does not 18

differentiate between "express" and "implied" misrepresentations,

and that such a dichotomy is impossible to square with its holding

that fraudulent misrepresentation claims escape preemption because

they "are predicated not on a duty 'based on smoking and health,'

but rather on a more general duty--the duty not to deceive." 505

U.S. at 528-29. As we have observed, that reasoning applies with

the same force regardless of whether a defendant allegedly made

false statements of material fact expressly or by implication.

-34-

descriptors, though accurate under the FTC method, are misleading

because they suggest that Lights are less harmful than fullflavored cigarettes," the Brown court reasoned that the FCLAA "preempts these 'implied misrepresentation' claims, which arise from

statements or imagery in marketing that misleadingly downplay the

dangers of smoking, and thus minimize or otherwise neutralize the

effect of the federal mandated safety warnings." 479 F.3d at 392

(citing Cipollone, 505 U.S. at 527).

In line with our earlier discussion, however, we do not

see anything in Cipollone's discussion of warning neutralization

claims that equates them with "implied misrepresentation" claims as

Brown does. We appreciate that the statements "light" and "lower 18

tar and nicotine" could support a warning neutralization claim,

i.e., by suggesting that those brands of cigarettes do not pose the

same grave threats to health announced in the accompanying warning

label. See, e.g., Maize v. Atl. Ref. Co., 41 A.2d 850, 852 (Pa.

1945) (upholding plaintiff's verdict in products liability suit on

the theory that calling cleanser "Safety-Kleen" could cause

accompanying warnings to "seem of comparatively minor import").
In reaching the opposite conclusion, Brown adopted the reasoning 19

of other courts, including the district court here, that fraud

claims arising out of the statements "light" and "lower tar and

nicotine" are preempted because the alleged "'deception . . . could

easily be corrected by requiring an additional warning on the

packages . . . .'" 479 F.3d at 393 (quoting In re Tobacco Cases II,

2004 WL 2445337, at *21). This reasoning tracks Justice Scalia's

"practical compulsion" test, which, as we have noted, does not

reflect the views of the Cipollone plurality. See note 17, supra.

-35-

But, as just discussed, it does not follow that those statements

cannot also support a different theory of recovery, including one

that falls outside the preemptive reach of FCLAA. Indeed, that 19

is the central teaching of Cipollone: the same alleged conduct by

a cigarette manufacturer can give rise to a number of claims, some

of them preempted and some of them not. 505 U.S. at 523-24.

Though, again, plaintiffs cannot dodge § 1334(b) by slapping a nonpreempted label on a preempted theory, they otherwise remain free

to choose from among these potential claims in framing their

complaints. See 5 Frumer & Friedman, supra, § 56.05[3], at 56-75

("Plaintiffs suing the tobacco companies must, of necessity, assert

a broad range of causes of action in order to avoid the pitfalls of

preemption"); accord Mulford, 2007 WL 1969734, at *17 (refusing "to

convert [a] claim into something that it is not" in deciding

whether the FCLAA preempts it).

Of course, plaintiffs who elect to proceed on a nonpreempted fraudulent misrepresentation theory must eventually prove

each of the elements of that cause of action if they are to

prevail, including that the challenged representations are indeed
-36-

false. But, unlike the court in Brown, we do not believe that a

plaintiff's chance of proving his claim plays any role in

determining whether it is preempted by the FCLAA. In rejecting the

plaintiffs' characterization of their claim as sounding in fraud,

Brown concluded that "[t]he terms 'light' and 'Lowered Tar and

Nicotine' cannot . . . be inherently deceptive or untrue," because

the cigarettes in question "do deliver less tar and nicotine as

measured by the only government-sanctioned methodology for their

measurement," i.e., the Cambridge Filter Method. 479 F.3d at 392;

see also Clinton, 2007 WL 2181896, at *11. This reality, in

Brown's eyes, foreclosed any fraudulent misrepresentation claim,

leaving the plaintiffs to argue that the challenged statements

served to neutralize the warnings--a theory preempted by

Cipollone's construction of the FCLAA. 497 F.3d at 392.

We think this approach puts the cart before the horse.

The assertion that Marlboro Lights and Cambridge Lights rate lower

in tar and nicotine than their full-flavored cousins according to

the Cambridge Filter Method may ultimately affect whether the

plaintiffs can show that the challenged statements are false. Cf.

Schwab, 449 F. Supp. 2d at 1090-91 ("evidence that the FTC approved

defendants' representations [as to tar and nicotine content] might

tend to disprove the existence of a scheme to defraud"). We do not

resolve the issue, however, because Philip Morris did not seek

summary judgment on that ground. Instead, Philip Morris argued
-37-

that the plaintiffs' claims--as set forth in their amended

complaint--were (1) expressly preempted, (2) implicitly preempted,

or (3) exempt from the reach of the Maine Unfair Trade Practices

Act. We consider the effect of the descriptors' claimed accuracy

on the second and third points infra, but we do not believe that

the issue has any relevance in deciding the express preemption

question.

Under Cipollone, whether § 1334(b) expressly preempts a

particular claim depends on "whether the legal duty that is the

predicate of the common-law damages action constitutes a

requirement or prohibition based on smoking or health . . . imposed

under State law with respect to advertising or promotion," 505 U.S.

at 524, not on whether the action itself can ultimately succeed as

a matter of substantive law. So we do not see how the statements'

falsity--or, for that matter, their materiality, or whether Philip

Morris made them with the requisite scienter--bears on the

preemption analysis. Such issues "go[] to the merits of the fraud

claim, not to the threshold question of preemption." Price, 848

N.E.2d at 36-37; see also Mulford, 2007 WL 1969734, at *17 ("Courts

do not determine whether a plaintiff can succeed on the merits of

the fraud claim before determining whether the fraud claim itself

is preempted."); cf. Glassner v. R.J. Reynolds Tobacco Co., 223

F.3d 343, 349-54 (6th Cir. 2000) (considering whether FCLAA

preempted fraud claim before considering whether plaintiff had
-38-

stated elements of fraud cause of action). We disagree, then, with

Brown's view that the FCLAA preempts fraud theories arising out of

"light" and "lower tar and nicotine" because those statements are

not "inherently deceptive or untrue." 479 F.3d at 392.

Finally, Philip Morris argues that, because "the

standards for finding liability under consumer protection acts

around the country vary widely," allowing the plaintiffs' claims to

survive preemption will undermine the FCLAA's goal of protecting

manufacturers from "diverse, nonuniform, and confusing cigarette

labeling and advertising regulations with respect to any

relationship between smoking and health." 15 U.S.C. § 1331(2).

This is not an imaginary concern. As we have explained, however,

fraudulent misrepresentation claims, even if brought under the

aegis of a state consumer protection act, are not premised on

"regulations with respect to any relationship between smoking and

health." They are premised on "longstanding rules governing

fraud," which themselves arise not from any duty based on smoking

and health, but on a duty not to deceive. Cipollone, 505 U.S. at

528-29. So, as Cipollone holds, neither the text of the FCLAA's

statement of purpose nor the preemption provision itself fairly

evinces the intent to displace all potentially inconsistent state

cigarette advertising regulations, only such regulations that are

"based on smoking and health." Id.
In fact, Justice Scalia brought this very point to the plurality's 20

attention, asserting that "it is not true that the States' laws

governing fraud and misrepresentation impose identical legal

standards." 505 U.S. at 553. The plurality, however, was not

swayed. See id. at 529 n.21.

-39-

Of course, Cipollone further reasoned that § 1334(b) does

not encompass fraudulent misrepresentation claims because they

"rely only on a single, uniform standard: falsity" and therefore

"do not create diverse, nonuniform and confusing standards." Id.

at 529 (internal quotation marks omitted). Seizing on this

language, Philip Morris notes that some of the elements of consumer

protection violations, such as reliance and actual damages, vary

from state to state. Yet the same can be said of the elements of

common-law fraud, see generally Peter A. Alces, The Law of 20

Fraudulent Transactions § 2:3 (1989 & 2006 supp.) (discussing how

states differ in articulating the elements of the tort), and

Cipollone nevertheless concluded that reading the FCLAA not to

preempt such claims was consistent with its text, context, and

purpose. 505 U.S. at 528-29. Bound by Cipollone, as the parties

agree we are, we reject the argument that the potential for varying

standards of liability under different states' consumer protection

acts means that the plaintiffs' claims are preempted by the FCLAA.

They are not. The district court's ruling was in error.

B.

Philip Morris also challenges the plaintiffs' claims as

impliedly preempted by federal law. Even in the absence of express
-40-

preemptive language--which the FCLAA contains, but which we have

concluded does not reach the claims in this case--federal law can

preempt state law by implication in two other ways. See, e.g.,

California v. ARC Am. Corp., 490 U.S. 93, 100 (1989). First,

"Congress implicitly may indicate an intent to occupy an entire

field to the exclusion of state law." Schneidewind v. ANR Pipeline

Co., 485 U.S. 293, 300 (1988). "Second, even if Congress has not

occupied the field, state law is nevertheless pre-empted to the

extent it actually conflicts with federal law, that is, when

compliance with both state and federal law is impossible, or when

the state law stands as an obstacle to the accomplishment and

execution of the full purposes and objectives of Congress." ARC

Am. Corp., 490 U.S. at 100-01; see also, e.g., United States v.

Locke, 529 U.S. 89, 109-11 (2000). And, whether through field or

conflict preemption, "state laws can be pre-empted by federal

regulations as well as by federal statutes." Hillsborough County,

Fla. v. Automated Med. Labs., Inc., 471 U.S. 707, 713 (1985).

Philip Morris does not argue that either Congress or the

FTC has evinced an intent to occupy the entire field of cigarette

advertising, or even the narrower field of low-tar cigarette

advertising. Nor does Philip Morris protest that complying with

both the state law the plaintiffs say has been violated and some

contrary federal law would be impossible. Instead, Philip Morris

maintains that the "[p]laintiffs' claims conflict with the FTC's
Philip Morris claims that these "arguments do not rely on the 21

FCLAA" (emphasis added), but does not identify any other

congressional action supporting them. Looking past this

contradiction, we nonetheless consider whether the FCLAA can serve

as a source of implied preemption. And insofar as Philip Morris's

implied preemption theory relies on what it perceives as the FTC's

desire for uniform national standards of cigarette advertising, as

-41-

40-year history of regulation and control over the development,

testing and marketing of low tar cigarettes, as well as the

reporting of tar and nicotine measurements pursuant to the FTC

Method and the use of descriptors substantiated by those

measurements." Because Philip Morris has limited its implied

preemption argument to the so-called "frustration-of-purpose"

theory, see Geier v. Am. Honda Motor Co., 529 U.S. 861, 873-74

(2000) (collecting cases), it cannot prevail unless "the rule of

law for which [the plaintiffs] contend [stands] 'as an obstacle to

the accomplishment and execution of' the important means-related

federal objectives" at stake. Id. at 881 (quoting Hines v.

Davidowitz, 312 U.S. 52, 67 (1941)).

In identifying those objectives, Philip Morris argues

that "Congress and the FTC have both sought uniform, national

standards for cigarette advertising with respect to smoking and

health. And State-law actions like this one would create a

different standard of deceptiveness that would plainly conflict

with these goals." At the outset, we reject the notion that the

plaintiffs' claims would interfere with any congressional designs

on cigarette advertising. It is true that, in the FCLAA, 21
we explain infra, we do not even think that the FTC itself has

enforced a uniform standard in this area.

-42-

"Congress prohibited state cigarette advertising regulations

motivated by concerns about smoking and health." Reilly, 533 U.S.

at 548. By the same token, however, "Congress offered no sign that

it wished to insulate cigarette manufacturers from longstanding

rules governing fraud," which are not so motivated. Cipollone, 505

U.S. at 529. As we have taken pains to elucidate, the plaintiffs'

claims seek to enforce state-law prohibitions on fraud, not statelaw prohibitions on cigarette advertising based on smoking and

health. So their asserted rule of law--that the statements "light"

and "lower tar and nicotine" constitute fraud--does not interfere

with the goals of the FCLAA, which do not include establishing any

national "standard of deceptiveness" for cigarette advertising.

In any event, both the Supreme Court and this one have

squarely held that the FCLAA has no preemptive force beyond the

language of § 1334(b) itself. Cipollone, as we have noted,

overturned the ruling of the court of appeals "that Congress had

impliedly pre-empted [the plaintiff's] claims challenging the

adequacy of warnings on labels or in advertising or the propriety

of [the defendants'] advertising and promotional activities,"

holding instead that "the pre-emptive scope of the [FCLAA] is

governed entirely by the express language in [§ 1334(b)]." 505

U.S. at 517. Relying on Cipollone, we decided in Harshbarger that
-43-

the FCLAA could not sustain an implied preemption challenge to a

Massachusetts law requiring, inter alia, cigarette manufacturers to

provide the state health department with nicotine yield ratings for

each of their brands "'which shall accurately predict nicotine

intake for average consumers.'" 122 F.3d at 62 (quoting Mass. Gen.

Laws ch. 94, § 307B (1996)).

In declining to imply a preemptive effect from the FCLAA,

Cipollone reasoned that "[w]hen Congress has considered the issue

of pre-emption and has included in the enacted legislation a

provision explicitly addressing that issue, and when that provision

provides a reliable indicium of congressional intent with respect

to state authority, there is no need to infer congressional intent

to pre-empt state laws from the substantive provisions of the

legislation." 505 U.S. at 517 (internal quotation marks and

citation omitted). Philip Morris argues that this reasoning has

lost its force in light of subsequent Supreme Court decisions

teaching that an express "pre-emption provision, by itself, does

not foreclose (through negative implication) 'any possibility of

implied conflict preemption.'" Geier, 529 U.S. at 869 (quoting

Freightliner Corp. v. Myrick, 514 U.S. 280, 288 (1995) (bracketing

by the Court and further citation omitted)); see also Sprietsma v.

Mercury Marine, 537 U.S. 51, 65 (2002). Philip Morris maintains

that Cipollone and Harshbarger thus pose no obstacle to its implied

preemption claim.
We nevertheless declined to forego implied preemption analysis 22

altogether in reliance on Cipollone, because the state disclosure

requirements had been challenged in part on the basis of amendments

to the FCLAA which Cipollone had not considered. 122 F.3d at 78.

These amendments, effectuated through the Comprehensive Smoking

Health Education Act of 1984, Pub. L. 98-474, 98 Stat. 2200, did

not change the FCLAA in any manner relevant to our analysis here,

and neither side has argued to the contrary. 

-44-

By the time we decided Harshbarger, however, the Supreme

Court had already made clear in Freightliner that "[a]t best,

Cipollone supports an inference that an express pre-emption clause

forecloses implied pre-emption; it does not establish a rule." 514

U.S. at 289. Yet we did not read Freightliner--which considered

the preemptive effect of a safety standard for trucks promulgated

under the National Traffic and Motor Vehicle Act of 1966

("NTMVSA"), 514 U.S. at 283-86--to cast doubt on Cipollone's view

that the presence of an express preemption clause in the FCLAA

rules out expanding its preemptive reach through implied preemption

principles. Harshbarger, 122 F.3d at 78. Moreover, Freightliner 22

explained that the Cipollone Court had, notwithstanding that view,

nevertheless "engaged in a conflict preemption analysis of the

[FCLAA], and found 'no general, inherent conflict between federal

preemption of state warning requirements and the continued vitality

of state common-law damages actions.'" 514 U.S. at 288-89 (quoting

Cipollone, 505 U.S. at 518).

Given this alternative basis for Cipollone's holding that

the FCLAA does not implicitly preempt state-law claims arising out
-45-

of cigarette advertisements or promotions, it remains good law

regardless of what the Court has since said, in other contexts,

about the effect of express preemption clauses on implied

preemption. Furthermore, we see nothing in either Geier or

Sprietsma--which, like Freightliner, did not consider the

preemptive effect of the FCLAA, but other federal statutes with

express preemption provisions--suggesting that the Cipollone Court

was wrong to draw an inference against implied preemption of statelaw challenges to cigarette advertising from the presence of an

express preemption provision in the FCLAA, as opposed to those

other statutes. Just as in Harshbarger, then, "[w]e are bound by

the Cipollone majority's holding that § 1334(b) governs the

preemptive scope of the FCLAA" and, therefore, "we are not at

liberty to address any implied preemption theories" premised on the

statute. 122 F.3d at 78.

Philip Morris also founds its implied preemption claim on

the FTC's oversight of cigarette advertising under the Federal

Trade Commission Act, 15 U.S.C. § 41 et seq. (1997). We agree that

neither Cipollone nor Harshbarger bars this argument, because those

cases considered the preemptive effect of only the FCLAA, which did

not "limit, restrict, expand, or otherwise affect the authority of

the [FTC] with respect to unfair or deceptive acts or practices in

the advertising of cigarettes." 15 U.S.C. § 1336. But we do not

agree that the FTC's exercise of its authority in this area has
-46-

preempted state-law damages actions, like this one, alleging that

a cigarette manufacturer has engaged in such acts or practices

through its use of the terms "light" and "lower tar and nicotine."

In brief, the FTC Act prohibits "unfair or deceptive acts

or practices in or affecting commerce," 15 U.S.C. § 45(a), and

empowers the Commission both to define and enforce that prohibition

in a number of ways relevant here. The Commission may prescribe

either informal "interpretive rules and general statements of

policy with respect to unfair or deceptive acts or practices," id.

§ 57a(a)(1)(A), or, pursuant to notice-and-comment procedures, see

id. §§ 57a(b)-(e), formal rules which define those acts and

practices "with specificity," id. § 57a(a)(1)(B). In addition, the

Commission may issue cease-and-desist orders against those engaged

in violations of the Act. Id. § 45(b). The FTC may enforce such

orders--as well as its formal rules--by suing violators for either

civil penalties, id. § 45(m), or "such relief as the court finds

necessary to redress injuries to consumers" or other injured

parties, id. §§ 57b(a),(b).

The FTC has regularly trained these powers on tar and

nicotine claims in cigarette advertising; as the district court

observed, "the tobacco industry is hardly unregulated in what it

says to consumers about its products, including light cigarettes."

436 F. Supp. 2d at 151. But we reject the suggestion--and we

describe it that way because, as we have noted, Philip Morris does
In support of this point, Philip Morris's brief relies heavily on 23

the Eighth Circuit's decision in Watson v. Philip Morris Cos., 420

F.3d 852 (8th Cir. 2005), rev'd, 127 S. Ct. 2301 (2007), which

held that the FTC's detailed supervision of the cigarette testing

process gave rise to federal removal jurisdiction over a lawsuit

similar to this one on the theory that it was an action against a

party "acting under" a federal officer pursuant to 28 U.S.C. §

1442(a)(1) (2006). This decision, however, was recently reversed

by the Supreme Court; Philip Morris now says that the Court's

"holding regarding [§] 1442(a)(1) removal has little to do with the

issues" before us. We agree, and think that the same was true of

the Eighth Circuit's holding to begin with. Philip Morris also

makes much of the fact that the "Supreme Court had no problem

'assuming' the regulatory facts" underlying the implied preemption

argument here, but we consider many of the same facts infra and

find them insufficient to support Philip Morris's position. We see

no need, then, to discuss either the Supreme Court's or the Eighth

Circuit's Watson decision further.

-47-

not purport to make a field preemption argument--that the degree of

federal regulation over a particular industry, no matter how

"comprehensive" or "detailed," can itself displace state law.23

As the Supreme Court has cautioned, to "infer pre-emption whenever

an agency deals with a problem comprehensively is virtually

tantamount to saying that whenever a federal agency decides to step

into a field, its regulations will be exclusive. Such a rule, of

course, would be inconsistent with the federal-state imbalance

embodied in our Supremacy Clause jurisprudence." Hillsborough

County, 471 U.S. at 717. Instead, under the established rules of

conflict preemption we have recited, we must determine whether the

FTC's oversight of tar and nicotine claims manifests a federal

policy intended to displace conflicting state law. 
-48-

As we have discussed, the FTC advised the tobacco

industry in 1966 that it could make "factual statements" of tar and

nicotine content, so long as they "were supported by adequate

records of tests conducted in accordance with the Cambridge Filter

Method." Press Release, Fed. Trade Comm'n (Mar. 25, 1966). The

FTC soon began to assess such claims by conducting its own tests of

cigarettes under the method, and proposed a formal rule requiring

cigarette manufacturers to disclose the results of those tests in

their advertisements. The proposal was put on hold, however, when

the manufacturers agreed to make those disclosures voluntarily.

Before entering into this agreement, the FTC had sought

a cease-and-desist order against The American Tobacco Company,

charging that ads for certain brands of its cigarettes deceitfully

created the impression that they were "low in tar" when they in

fact contained more tar than the average brand per then-current FTC

test results. This charge was resolved through a 1971 consent

order forbidding American from "advertising that any cigarette

manufactured by it, or the smoke therefrom, is low or lower in

'tar' by use of the words 'low,' 'lower,' or 'reduced' or like

qualifying terms, unless the statement is accompanied by a clear

and conspicuous disclosure of the 'tar' and nicotine content in

milligrams in the smoke produced by the advertised cigarette." In

re Am. Brands, Inc., 79 F.T.C. 255, 258 (1971) (internal formatting

omitted). For purposes of the order, "tar and nicotine content"
As the result of a subsequent cease-and-desist action against 24

American, the company entered into another consent order with the

FTC. In re American Tobacco Co., 119 F.T.C. 3 (1995). While this

order limited American's ability to make certain kinds of tar and

nicotine claims, see infra note 26, the order also allowed the

company, subject to certain restrictions, to compare the tar and

nicotine ratings of its brands to those of other brands "with or

without an express or implied representation that [its] brand is

'low,' 'lower,' or 'lowest' in tar and/or nicotine." Id. at 11

(parentheses omitted).

-49-

was defined as "determined by the [FTC] in its testing," i.e., per

the Cambridge Filter Method. Id. at 259. 24

Based principally on these exercises of authority over

tar and nicotine claims, Philip Morris argues that the FTC has

expressed a "policy of allowing their use so long as substantiated

with the FTC Method numerical results and requiring publication of

those results in all brand advertisements." Because the

plaintiffs' claims "stand[] as an obstacle" to this policy, Philip

Morris continues, they are implicitly preempted. Like the

plaintiffs, we see a number of problems with this argument.

First, since its 1969 agreement with the tobacco

companies, the FTC has never issued a formal rule specifically

defining which cigarette advertising practices violate the Act and

which do not. As the plaintiffs point out, there is some authority

for the proposition that "[s]tate prohibitions of unfair and

deceptive practices are not preempted unless they conflict with an

express FTC rule." United States v. Philip Morris, Inc., 263 F.

Supp. 2d 72, 78 (D.D.C. 2003) (emphasis omitted); see also
-50-

Katharine Gibbs Sch., Inc. v. FTC, 612 F.2d 658, 667 (2d Cir.

1979); Wisconsin v. Amoco Oil Co., 293 N.W.2d 487, 496 (Wis. 1980);

accord Wabash Valley Power Ass'n v. Rural Electrification Admin.,

903 F.2d 445, 454 (7th Cir. 1990) (declining to give preemptive

effect to agency action taken without regard to formal rulemaking

procedures); Elizabeth Blackwell Health Ctr. for Women v. Knoll, 61

F.3d 170, 196 (3d Cir. 1995) (Nygaard, J., dissenting). Other

courts, however, have held that an agency can preempt state law

through action short of formal rulemaking. See, e.g., Elizabeth

Blackwell Health Ctr., 61 F.3d at 182-83 (HHS interpretive rule);

Feikema v. Texaco, Inc., 16 F.3d 1408, 1418 (4th Cir. 1994) (EPA

consent order); Gen. Motors Corp. v. Abrams, 897 F.2d 34, 39 (2d

Cir. 1990) (FTC consent order); Dowhal v. SmithKline Beecham

Consumer Healthcare, 88 P.3d 1, 9-10 (Cal. 2004) (FDA letters to

drug manufacturers).

Unlike many other exercises of agency authority, formal

rulemaking comes with a host of procedural protections under the

Administrative Procedure Act ("APA"), such as notice of the

proposed rule, an opportunity for interested parties to

participate, a statement of the basis and purpose of any rule

adopted, and its publication in the Federal Register. 5 U.S.C. §

533 (2007). Limiting the preemptive power of federal agencies to

exercises of formal rulemaking authority, then, ensures that the

states will have enjoyed these protections before suffering the
-51-

displacement of their laws. See, e.g., Wabash Valley Power Ass'n,

903 F.2d at 453-54; Richard J. Pierce, Jr., Regulation,

Deregulation, Federalism and Administrative Law, 46 U. Pitt. L.

Rev. 607, 664-65 (1985). This reasoning has particular force in

the case of the FTC Act, which imposes procedural requirements on

the Commission's rulemaking powers that exceed those of the APA.

15 U.S.C. §§ 57(c)-(e). Indeed, courts and commentators have

understood these additional safeguards to reflect a congressional

concern--well-documented in their legislative history--over the

preemptive effect of FTC regulation on state consumer protection

law. See Am. Fin. Servs. Ass'n v. FTC, 767 F.2d 957, 989-90 & n.41

(D.C. Cir. 1985); Katharine Gibbs, 617 F.2d at 677; Paul R.

Verkuil, Preemption of State Law by the Federal Trade Commission,

1976 Duke L.J. 225, 243 (1976); Pierce, supra, at 638-40. 

Second, apart from the likely import of its rulemaking

provisions, the FTC Act raises an additional hurdle to Philip

Morris's implied preemption theory, at least insofar as that theory

relies on the 1971 and 1995 consent orders. The Act states that

"[r]emedies provided in [15 U.S.C. § 57b] are in addition to, and

not in lieu of, any other remedy or right of action provided by

State or Federal law." 15 U.S.C. § 57b(e). And § 57b, as we have

observed, empowers the Commission to sue for relief on behalf of

consumers against those who violate its cease-and-desist orders

against unfair or deceptive acts or practices. We do not think it
-52-

a stretch, then, to say that when the FTC merely issues such an

order, but never uses it as the basis for a subsequent lawsuit, the

order does not supplant state-law rights of action any more than

the lawsuit would have. A number of authorities have reached the

same conclusion, though not necessarily by way of the same

rationale. See California v. Am. Stores Co., 872 F.2d 837, 843-44

(9th Cir.), rev'd on other grounds, 495 U.S. 916 (1989); Louisiana

ex rel. Guste v. Fedders Corp., 543 F. Supp. 1022, 1024 (M.D. La.

1982); Arvin Indus. v. Maremont Corp., 1973-1 Trade Cases ¶ 74,416,

1973 WL 784, at *3 (S.D. Ind. Mar. 9, 1973); 1 Stephanie W. Kanwit,

Federal Trade Commission § 12:6 (2006); but see Gen. Motors Corp.,

897 F.2d at 39 (holding that an FTC "consent order reflecting a

reasonable policy choice and issued pursuant to a congressional

grant of authority may preempt state legislation").

Relying on the Supreme Court's decision in Geier, Philip

Morris argues that § 57b(e), which it calls a "savings clause,"

"does not bar the ordinary working of conflict pre-emption

principles." 529 U.S. at 869. Geier held that the savings clause

of the NTMVSA, which provides that "'[c]ompliance with' a federal

safety standard 'does not exempt any person from liability under

common law,'" id. at 868 (quoting 15 U.S.C. § 1397(k) (1988)), did

not preserve "state-law tort actions that conflict with federal

regulations." Id. at 869. The Court reasoned that "[t]he words

'compliance' and 'does not exempt' sound as if they simply bar a
-53-

special kind of defense, namely, a defense that compliance with a

federal standard automatically exempts a defendant from state law,

whether the Federal Government meant that standard to be an

absolute requirement or only a minimum one." Id. (citation

omitted). Thus, the Court explained, the federal standard would

displace conflicting state law in the former case, but not the

latter, where a plaintiff remains free to argue for a higher statelaw standard as envisioned by the savings clause. Id. at 870.

But unlike the savings clause of the NTMVSA, § 57b(e)

does not speak of compliance with a federal standard as a defense

to a state-law claim, leaving open the possibility of a preemptive

conflict between the standard and the claim. Instead, § 57b(e)

specifically provides that state-law rights of action survive the

FTC's efforts at judicial enforcement of its own federal standards:

in other words, that those efforts are "in addition to, and not in

lieu of" other available remedies. We can think of no other

purpose for this clause other than to allow further relief from

unfair or deceptive acts or practices under state law even after

the Commission has already challenged them through litigation under

the FTC Act, and Philip Morris does not suggest any. Cf. Geier,

529 U.S. at 870 (noting that Court's reading of the NTMVSA's

savings clause did not "conflict with the purpose of the saving

provision, say, by rendering it ineffectual").
Similarly, when seeking relief on behalf of consumers for 25

violation of a consent order, the FTC may proceed against the

parties to the order only. 15 U.S.C. § 57b(a)(2).

-54-

This reading of § 57b(e), moreover, does nothing to

diminish the FTC's power to preempt state law through other

assertions of its authority. After entering into a consent order,

for example, the Commission remains free to adopt its terms as a

formal rule, 15 U.S.C. § 57a(b)(1); as we have discussed, this

process affords states and other interested parties with the kinds

of procedural protections usually deemed essential to regulatory

preemption. See, e.g., Wabash Valley Power Ass'n, 903 F.3d at 454.

We acknowledge, as Philip Morris points out, that an agency often

prefers to formulate policy through case-by-case adjudication,

rather than rulemaking, and that adjudicated cases "generally

provide a guide to action that the agency may be expected to take

in future cases." NLRB v. Wyman-Gordon Co., 394 U.S. 759, 756-66

(1969) (plurality opinion). "But this is far from saying . . .

that commands, decisions, or policies announced in adjudications

are 'rules' in the sense that they must, without more, be obeyed by

the affected public." Id. Indeed, the FTC Act itself reflects

this distinction, at least with regard to consent orders: it

specifically provides that the Commission cannot enforce them

against non-parties. 15 U.S.C. § 45(m)(1)(B). So we do not 25

believe that the FTC can preempt state-law actions arising out of

particular practices simply by entering into a consent order
-55-

allowing them to continue. See Am. Stores, 872 F.2d at 843 (ruling

that consent decree, which resolved FTC's challenge to corporate

merger under FTC Act by requiring partial asset divestiture, did

not bar challenge to merger by state, which "may have different

interests than does the FTC in protecting its citizens from

antitrust violations").

Third, as the one court squarely holding that FTC consent

orders can preempt state law has recognized, the mere entry of such

an order dealing with a particular practice "is insufficient to

preclude supplemental state regulation." Gen. Motors Corp., 897

F.2d at 39. Thus, even if we were to agree that FTC action short

of formal rulemaking--including consent orders--can implicitly

preempt state law in some cases, we do not think that this is one

of them, because the plaintiffs' state-law claims do not pose a

threat to any federal regulatory objectives apparent in the FTC's

approach to tar and nicotine claims in cigarette advertising.

Though Philip Morris argues that FTC policy permits a

manufacturer to make such claims so long as they are consistent

with the results of testing under the Cambridge Filter Method and

those results are disclosed in the manufacturer's advertising, the

Commission has on occasion challenged statements about the tar or

nicotine content of a particular brand even though they were

supported by such testing. In 1982, for example, the FTC told a

cigarette manufacturer that it could not rely on the Cambridge
In the consent order resolving this charge, American agreed to 26

refrain from representing, through certain comparisons of the tar

ratings of any of its brands to those of other brands, "that

consumers will get less tar by smoking ten packs of any cigarette

rated as having 1 mg. of tar than by smoking a single pack of any

other brand of cigarettes that is rated as having more than 10 mg.

of tar." 119 F.T.C. at 10. But the order preserved American's

ability otherwise to compare the tar and nicotine ratings of its

brands to those of other brands, provided "such representation is

true and, at the time of making [it], [American] possesses and

relies upon reliable scientific evidence that substantiates the

representation." Id. at 10-11. Philip Morris characterizes this

part of the order as permitting tar and nicotine claims so long as

they are substantiated by the Cambridge Filter Method. If this is

the case, we wonder why the FTC did not simply identify the method

by name instead of calling it "reliable scientific evidence," but,

in any event, the interpretation of this particular aspect of the

1995 consent order does not affect our conclusion that the FTC's

decision to challenge American's ads in the first place shows that

it has not given its blessing to all Cambridge Filter Methodsupported tar and nicotine claims. 

-56-

Filter Method to substantiate claims that one of its brands had

only 1 milligram of tar, because the method did not accurately

measure the tar and nicotine content of that brand due to its

unusual filter design. See FTC v. Brown & Williamson Tobacco

Corp., 778 F.2d 35, 37-39 (D.C. Cir. 1985). The FTC has also

challenged a manufacturer's advertisements "that consumers will get

less tar by smoking ten packs of [its] brand cigarettes than by

smoking a single pack of the other brands of cigarettes depicted in

the ads," since the claim was based on "ratings obtained through

smoking machine tests that do not reflect actual smoking, in part

because the machines do not take into account such behavior as

compensatory smoking." In re Am. Tobacco Co., 119 F.T.C. at 4.26
In Part II.C, infra, we consider whether the FTC "permitted" the 27

claims at issue so as to exempt them from the coverage of the Maine

Unfair Trade Practices Act. 

Philip Morris intimates that the plaintiffs have waived any 28

argument based on Sprietsma because they did not rely on it below.

Though the plaintiffs did not cite the case to the district court,

they did argue that "no federal purpose or objective would be

frustrated by a finding of liability against Defendants in this

case." In taking up this argument on appeal, then, we are free to

consider Sprietsma--which, after all, is binding Supreme Court

-57-

The FTC, then, has not invariably allowed tar and

nicotine claims that are supported by the Cambridge Filter Method,

but has recognized that such claims may nevertheless amount to

unfair or deceptive acts or practices in certain circumstances. 

We acknowledge that the claim at issue here--that Marlboro and

Cambridge Lights have "lower tar and nicotine" than their fullflavored versions--differs from those the FTC has challenged in the

past, but our task is not to decide whether the FTC would view a

particular kind of tar and nicotine claim as a violation of the FTC

Act. Instead, we must determine whether the FTC's oversight of 27

such claims "convey[s] an authoritative message of a federal

policy" jeopardized by the plaintiffs' common-law damages action.

Sprietsma, 537 U.S. at 67. Because the only policy we perceive is

that certain tar and nicotine claims consistent with Cambridge

Filter Method test results can still amount to unfair or deceptive

acts or practices, we think not.

We derive additional support for this conclusion from

Geier and Sprietsma. Geier ruled that a state-law tort action 28
authority. See, e.g., Air Line Pilots Ass'n, Int'l v. Guilford

Transp. Indus., Inc., 399 F.3d 89, 100 n.7 (1st Cir. 2005). 

-58-

alleging that the defendant had negligently designed the

plaintiff's 1987 car without airbags would frustrate the purpose of

a federal regulation "requir[ing] auto manufacturers to equip some

but not all of their 1987 vehicles with" such devices. 529 U.S. at

864-67. Based on its review of the administrative record of the

regulation in question and a brief from the Solicitor General

explaining the agency's position, the Court identified the federal

purpose as a "policy judgment that safety would be best promoted if

manufacturers installed alternative protection systems in their

fleets rather than one particular system in every car." Id. at 881

(internal quotation marks omitted). Conversely, in Sprietsma, the

Court declined to infer that the Coast Guard's decision not to

enact a rule under the Federal Boat Safety Act ("FBSA") requiring

propeller guards on recreational boat engines preempted a state-law

tort suit premised on the lack of such a device. 537 U.S. at 67.

As the Court saw it, the Coast Guard's decision did not reflect "a

federal policy against propeller guards," id. at 67, but simply "a

judgment that the available data did not meet the FBSA's

'stringent' criteria for federal regulation." Id. at 66. As in

Geier, the Court based this conclusion on the agency's explanation

for its decision, as well as an amicus brief from the Solicitor

General explaining its position. Id. at 66-68.
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Geier and Sprietsma, then, teach that it is not the fact

of agency action on a particular subject alone--but the reasons for

the action--that control its preemptive effect. And here, no clear

rationale emerges from the history of the FTC's treatment of tar

and nicotine claims; indeed, the parties point to conflicting

statements by the Commission itself on whether it even has an

official position on the definitions of the terms "light" and

"lower tar and nicotine." Compare, e.g., 62 Fed. Reg. 48,158,

48,163 (Sept. 12, 1997) ("There are no official definitions for

these terms") with, e.g., 1980 FTC Rep. to Congress 18 n. 11 ("The

FTC has not defined . . . any term related to tar level except for

'low "tar"', which the FTC defines as 15.0 mg or less 'tar.'").

Moreover, as in Sprietsma and in contrast to Geier, the Solicitor

General recently filed a brief in the Supreme Court explaining that

the FTC "has never promulgated definitions of terms such as 'light'

and 'low tar'" and that its previous statements purporting to

define them "did not reflect an official regulatory position." Br.

for United States as Amicus Curiae Supporting Petitioners, Watson

v. Philip Morris Cos., 127 S. Ct. 2301 (2007) (No. 05-1284), 2006

WL 3694382, at *4. On this record, we cannot discern a coherent

federal policy on low-tar claims, let alone one driven by the sort

of "important means-related federal objectives" necessary to

preempt conflicting state law. Geier, 529 U.S. at 881; cf. Int'l

Paper Co. v. Ouellete, 479 U.S. 481, 497 (1987) (finding conflict
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between Clean Water Act and inconsistent state law where "[i]t

would be extraordinary for Congress, after devising an elaborate

permit system that sets clear standards, to tolerate common-law

suits that have the potential to undermine this regulatory

structure") (emphasis added). The plaintiffs' claims are not

implicitly preempted.

C.

Finally, Philip Morris argues that its challenged

advertising practices constitute "[t]ransactions or actions

otherwise permitted under laws as administered by any regulatory

board or officer acting under the statutory authority of the United

States" and, as such, are excepted from the Maine Unfair Trade

Practices Act. Me. Rev. Stat. Ann. tit. 5, § 208(1). This

argument, like Philip Morris's implied preemption theory, depends

largely on its characterization of FTC policy to allow the use of

the terms "light" and "lower tar and nicotine" when supported by

testing under the Cambridge Filter Method. And, as we have

explained, we disagree with that characterization: the full history

of the FTC's oversight of tar and nicotine claims reveals its view

that, depending on the circumstances, those claims can be unfair or

deceptive notwithstanding their support in Cambridge Filter Method

test results. See, e.g., Brown & Williamson Tobacco Corp., 778

F.2d at 37-39; In re Am. Tobacco Co., 119 F.T.C. at 4. 
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We disagree, then, with those courts holding that the FTC

has "authorized" Philip Morris's "light" and "lower tar and

nicotine" claims so as to put them beyond the reach of state

consumer protection statutes with exceptions similar to Maine's.

See Flanagan v. Altria Group, Inc., No. 05-71697, 2005 WL 2769010,

at *6 (E.D. Mich. Oct. 25, 2005); Price, 848 N.E.2d at 50; see also

Sullivan v. Philip Morris USA, Inc., No. 03-796, 2005 WL 2123702,

at *9 (W.D. La. Aug. 31, 2005) (finding "light" and "lower tar and

nicotine" claims to constitute "conduct that complies with" 15

U.S.C. § 45(a)(1) and therefore exempt from Louisiana Unfair Trade

Practices and Consumer Protection Act). In our view, these

decisions overlook the subtleties in the Commission's approach to

tar and nicotine claims we have already discussed.

The court in Price, for example, concluded that the FTC,

through its 1971 and 1995 consent orders with American Tobacco,

"could, and did, specifically authorize all United States tobacco

companies to utilize the terms 'low,' 'lower,' 'reduced' or like

qualifying terms such as 'light' so long as the descriptive terms

are accompanied by a clear and conspicuous disclosure of the 'tar'

and nicotine content in milligrams of the smoke produced by the

advertised cigarette." 848 N.E.2d at 50. As we have explained,

though, the American Tobacco consent orders may have provided

guidance to the rest of the industry on how the Commission would

likely view such claims in the future, but they by no means
Indeed, Philip Morris, while maintaining that "[t]he FTC has 29

specifically permitted the use of descriptors . . . that reflect

the Cambridge Method's yield measurements," has nevertheless asked

it to "adopt a rule expressly authorizing the industry to continue

to use such descriptors" if accompanied by "disclaimers" about

compensation and in accordance with "uniform" definitions of the

terms to correspond to particular tar ratings. Petition for

Rulemaking at 4, 34, In re Petition for Rulemaking Concerning Tar

and Nicotine Testing and Disclosure (F.T.C. Sept. 18, 2002),

available at http://www.ftc.gov/os/comments/philipmorrisconabisco/

philipmorrispetition.pdf. The FTC has yet to rule on the petition.

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reflected an across-the-board approval of the use of the

descriptors alongside the tar and nicotine ratings. And again, had

the FTC intended to "authorize" those kinds of advertisements, it

needed only to exercise its rulemaking authority to that end.29

That the Commission has not done so is reason enough to doubt the

conclusions of Price and other courts that the FTC's handling of

"light" and "lower tar and nicotine claims" has removed them from

the purview of state consumer protection laws.

Furthermore, even if the consent decrees did "authorize"

particular tar and nicotine claims for purposes of state consumer

protection laws, that authorization does not appear to extend to

the claims at issue here. Insofar as the 1971 consent decree

permits "use of the words 'low,' 'lower,' or 'reduced' or like

qualifying terms," it does so only if "the statement is accompanied

by a clear and conspicuous disclosure of the 'tar' and nicotine

content in milligrams in the smoke produced by the advertised

cigarette" per the Cambridge Filter Method. In re Am. Brands,
Philip Morris does not argue that the 1995 American Tobacco 30

consent order relaxed the requirements of the 1971 order, so we do

not separately discuss the 1995 order here.

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Inc., 79 F.T.C. at 258 (internal formatting omitted). But, as the

plaintiffs point out, Philip Morris uses the terms "light" and

"Lowered Tar and Nicotine" on the packages of Marlboro and

Cambridge Lights without mentioning their tar and nicotine ratings.

Philip Morris responds that the FTC could not have mandated those

disclosures on the packages because, under the FCLAA, "[n]o

statement relating to smoking and health, other than the [health

warnings] required by [15 U.S.C. § 1333], shall be required on any

cigarette package." 15 U.S.C. § 1334(a). 30

We see at least two weaknesses in this position. First,

as we have noted, the FCLAA also provides that "[n]othing in this

chapter (other than the requirements of [15 U.S.C. § 1333]) shall

be construed to limit, restrict, expand, or otherwise affect the

authority of the [FTC] with respect to unfair or deceptive acts or

practices in the advertising of cigarettes." 15 U.S.C. § 1336. So

it is at least arguable that the restriction on additional healthrelated statements in the FCLAA does not apply to the FTC. See FDA

v. Brown & Williamson Tobacco Corp., 529 U.S. 120, 185 (2000)

(Breyer, J., dissenting). Second, if the portion of the 1971

consent order requiring disclosure of tar and nicotine yields does

not apply to cigarette packages, then, it would seem to us, neither

does the portion of the order permitting the use of the
The court in Price read the 1971 consent order to authorize 31

Philip Morris's use of the descriptors sans disclosures on the

theory that the disclosure requirement "applies only when the

manufacturer is making a direct comparison between its brand of

cigarettes and a competing brand." 848 N.E.2d at 37. Philip

Morris does not rely on that reading here. As we have said,

however, we take the view that, because the disclosure requirement

is essential to the order, if it does not apply in a certain

context, than neither does any "authorization" of the descriptors.

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descriptors. Otherwise, the order would have allowed American

Tobacco to label its cigarettes as low tar without disclosing that

they in fact had more tar than the average cigarette--in essence,

to continue the same allegedly deceptive practice that led the FTC

to seek the order in the first place. We have great difficulty

reading the consent order in such a self-defeating manner.31

We do not mean to suggest that the consent orders have no

bearing at all on whether Philip Morris's use of the terms "light"

and "Lowered Tar and Nicotine" violates the Maine Unfair Trade

Practices Act. Indeed, the Act provides that, in construing its

ban on unfair or deceptive acts or practices, "courts will be

guided by the interpretations given by the Federal Trade Commission

and the Federal Courts to [15 U.S.C. § 45(a)(1)], as from time to

time amended." Me. Rev. Stat. Ann. tit. 5, § 207; see, e.g.,

Searles v. Fleetwood Homes of Pa., Inc., 878 A.2d 509, 520 (Me.

2005) (relying on FTC consent decree to determine whether

particular practice was unfair under § 207). But whether Philip

Morris's challenged statements fit the statutory proscription is

not the question before us. We conclude simply that those
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statements are not "authorized" by the consent orders or anything

else in the FTC's approach to tar and nicotine claims so as to

exempt them from the Act. See Mulford, 2007 WL 1969734, at *29;

Aspinall v. Philip Morris Cos., Civ. A. No. 98-6002, 2006 WL

2971490, at *8 (Mass. Super. Ct. Aug. 9, 2006), rev. granted, No.

SJC-09981 (Mass. Apr. 25, 2007). 

Finally, in an echo of its implied preemption argument,

Philip Morris posits that, even if the consent orders did not

authorize the tar and nicotine claims at issue here, the FTC's

"comprehensive, detailed regulation of cigarette advertising and

promotion" suffices to exempt them from the Maine Unfair Trade

Practices Act (internal quotation marks omitted). The Act,

however, exempts "[t]ransactions or actions otherwise permitted"

(emphasis added), not "otherwise regulated." Cf. Mary Dee Pridgen,

Consumer Protection and the Law § 4:32 (1986 & 2006 supp.)

(contrasting consumer protection statutes exempting "actions or

transactions otherwise . . . regulated" with those exempting "only

those activities 'permitted'").

Unlike Philip Morris, we do not believe that the Maine

Supreme Judicial Court equated these two concepts in First of Maine

Commodities v. Dube, 534 A.2d 1298 (Me. 1987). There, the

plaintiffs claimed that the defendant real estate broker had

violated the Maine Unfair Trade Practices Act by failing to notify

them of their purported right under another statute to void the
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parties' exclusive listing agreement within three days of its

execution. Id. at 1301. The court observed that the Maine Real

Estate Commission "may investigate and penalize licensed brokers

who violate the numerous statutory restrictions on their

activities," including one imposing specific standards on exclusive

listing agreements--but not the three-day voiding option the

plaintiffs sought to enforce. Id. at 1301 (citing Me. Rev. Stat.

Ann. tit. 42 § 4004 (1978 & 1986 supp.). Thus, the court concluded

that "[b]ecause by statute the Maine Real Estate Commission

extensively regulates brokers' activities, including the execution

of exclusive listing agreements, such activities fall outside the

scope of Maine's Unfair Trade Practices Act." Id. at 1302.

We read First of Maine Commodities, then, for the

proposition that conduct is exempt from the Unfair Trade Practices

Act where it is subject to specific standards left to the

enforcement of an administrative agency, not merely those

circumstances in which the agency's regulatory scheme is generally

"extensive" or "detailed." See also Weinschenk, 868 A.2d at 205

(rejecting argument that § 208(1) exempted builder's sales of

homes "because industry operations are separately regulated by

state or federal law"). As we have discussed, the FTC does not

appear to have imposed specific standards on tar and nicotine

claims in cigarette advertising; even if it has, the plaintiffs

here, in contrast to the plaintiffs in First of Maine Commodities,
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do not seek to hold Philip Morris liable under the Unfair Trade

Practices Act for complying with those standards. Neither First of

Maine Commodities nor the language of § 208(1) itself supports

Philip Morris's argument that its use of the terms "light" and

"Lowered Tar and Nicotine" is a "transaction[] or action[]

otherwise permitted under laws administered by any regulatory board

or officer" exempt from the Maine Unfair Trade Practices Act.

III.

In summary, we conclude that the plaintiffs' claims that

Philip Morris has made fraudulent misrepresentations in violation

of the Maine Unfair Trade Practices Act by advertising and

promoting Marlboro and Cambridge Lights as "light" and having

"Lowered Tar and Nicotine" are not (1) expressly preempted by the

FCLAA, (2) implicitly preempted, either by the FCLAA or by the

FTC's oversight of tar and nicotine claims in cigarette

advertising, or (3) barred by the Act's exemption for "transactions

or actions otherwise permitted." We do not, of course, reach any

conclusion on the merits of the plaintiffs' claims, the

availability of summary judgment on other grounds, or the force of

or any other defense potentially available to Philip Morris; and

nothing in what we have said should be construed as expressing any

views on those issues that are not before us. As always, "we leave

the extent and nature of further proceedings in the hands of the

district court." Patterson v. Patterson, 306 F.3d 1156, 1162 (1st
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Cir. 2002). We vacate the judgment of the district court and

remand for further proceedings.

So ordered.