R.J. Reynolds Targeted Kids, Records Show

Despite repeated public denials, R.J. Reynolds Tobacco Co., the nation’s second-leading cigarette manufacturer, targeted teenage smokers as young as 13 in an attempt to regain market share during the last 25 years, according to internal company documents released Wednesday.

One memo from 1987, stamped “RJR secret,” describes a plan to develop a new wide Camel cigarette targeted at “younger adult male smokers,” primarily the 13-24 age group, then smoking Marlboro, Philip Morris’ leading brand. RJR subsequently brought Camel Wides to market.

Another memo from a 1974 presentation to the board of RJR Industries by C.A. Tucker, the vice president of marketing, said flatly: “This young adult market, the 14-24 age group . . . represent tomorrow’s cigarette business. As this 14-24 age group matures, they will account for a key share of the total cigarette volume--for at least the next 25 years.”

After the papers, spanning 1973 to 1992, were released, Reynolds continued to deny that it has targeted underage smokers and said the documents released Wednesday were being taken out of context.

The documents were released by Rep. Henry A. Waxman (D-Los Angeles), a longtime industry critic. He got the papers from attorneys in California who obtained them from RJR in a case settled last September that accused the company of using deceptive marketing practices, including youth targeting, in its highly successful Joe Camel campaign.

The papers’ release also heightens the possibility that the proposed $368.5-billion national tobacco settlement will be stiffened in Congress, in particular with enhanced penalties on tobacco companies if they fail to reduce youth smoking.

The documents also are likely to have an impact on the Justice Department’s criminal investigation of the industry and numerous lawsuits against the cigarette companies, including Minnesota’s massive suit against the industry, scheduled to start next week.

Strongest Proof of ‘Smoking Gun’

Waxman and David A. Kessler, former commissioner of the Food and Drug Administration, said the new documents represent the strongest proof to date that the cigarette industry targeted minors after studying them in depth.

“If you’re looking for a smoking gun on youth targeting, you need look no further than these documents,” said Kessler, now dean of the Yale University Medical School.

“It’s very hard to read these documents and then say that the industry should get any special legal protections from Congress,” Kessler said. The industry’s key legislative goal this year is to obtain congressional ratification of the national litigation settlement, which would prohibit all future class-action suits and punitive damages against the cigarette companies.

The papers also may intensify the Justice Department’s investigation of whether cigarette officials misled the government about the nature of their products and industry marketing practices.

Waxman said he would send the material to Atty. Gen. Janet Reno and ask her to broaden the current Justice Department probe. Among other matters, Justice and FBI officials are investigating whether the industry misled government officials by telling them that they never deliberately marketed their products to children. Among the incidents being reviewed is whether former RJR President James W. Johnston lied in testimony to a House subcommittee on April 14, 1994.

On that day, Johnston testified that “we do not market to children and will not.” He also testified that “we do not survey anyone under the age of 18.”

Johnston, who resigned as chief executive of RJR’s worldwide tobacco operations in June 1996, did not return calls Wednesday.

However, the new documents “present a very different picture of RJR’s actions” than Johnston conveyed, Waxman said.

Additionally, a 1973 marketing memo states that the company should use comic strips to help entice “younger smokers” away from Philip Morris’ Marlboro, which had become the leading teenage brand. That document described “younger smokers” as 14 to 24.

Survey of Teen Smoking Habits

In another instance, RJR commissioned a “Smokers Screening Profile” that surveyed the smoking habits of more than 11,000 teenagers, ages 14 to 17, including data on their brand of cigarette, cigarette purchasing habits, age, sex, religion, residence, household income, education and occupation of parents.

The memos clearly reflect deep concern at RJR about their competitors Philip Morris and Brown & Williamson showing “unusual strength among these younger smokers,” which “suggests continued growth for Philip Morris and B&W; as their smokers mature.”

On the other hand, the memo notes that RJR’s two major brands, Winston and Salem, “show comparative weakness . . . among these young smokers.” Tucker goes on to say that the company’s market share will erode “unless this situation is corrected.”

Several documents reveal the thought process that led up to RJR’s 1988 launch of its highly successful and controversial Joe Camel campaign and how the campaign operated. An August 1988 memo states that outdoor advertisements should be placed wherever young people congregate, with the ideal locations being sites near fast-food restaurants, convenience stores, urban basketball courts, video game arcades and record stores.

Reynolds issued a formal statement saying the documents were being misconstrued. For example, the company asserted that the 1987 document contained a typographical error and that, in reality, the memo should have said “18- to 24-year-old male Marlboro smokers.”

The company reiterated its long-standing position that it does not target teenagers. “While attitudes toward smoking have changed over the last several decades, Reynolds Tobacco Co.’s position and policy have remained constant: that smoking is a choice for adults and marketing programs are directed at those above the legal age to smoke,” the company said in a written statement.

“Not only is it unfair to the employees of Reynolds Tobacco to strip these documents from the context and perspective of the broad company record as well as the social standards of the times in which they were created, it is unfair to the American people and serves only the agenda of some who seek to benefit from a broad misperception of how this company has conducted this business.”

Additionally, Reynolds said a small number of documents had been “cherrypicked” from about 100,000 produced in the Joe Camel case in San Francisco. The company also said it had turned over all these documents to the Federal Trade Commission.

Companies Agree to Avoid Cartoons

In May, the FTC charged that Reynolds’ highly successful Joe Camel campaign illegally induced children and adolescents to smoke. By a 3-2 vote, the commission asked an administrative law judge to issue a cease-and-desist order to prevent RJR from using the cartoon camel in ways that “would have a substantial appeal to children and adolescents below the age of 18.”

Reynolds said it would vigorously challenge the FTC’s order.

However, less than a month later, RJR and the nation’s other leading cigarette manufacturers reached the $368.5-billion litigation settlement with state attorneys general that included a term barring the use of cartoon characters such as Joe Camel in future industry marketing.

Even though that settlement is still pending in Congress, Reynolds announced in July that it was retiring the hip character. At the time, company officials said they were looking for a new advertising strategy.

Wednesday’s document release was not the first time Reynolds was accused of targeting youths. In 1995, some internal company documents surfaced that raised some of the same issues.

In one 1973 memo, RJR assistant research director Claude E. Teague Jr. wrote that, “if our company is to survive and prosper, over the long term we must get our share of the youth market.” The memo laid out a strategy to appeal to what Teague called “learning smokers.”

At the time, company officials said Teague’s ideas did not represent company policy and were not implemented. They also said Teague did not interact with company marketing officials.

However, a June 1974 document released Wednesday shows that Teague, along with RJR internal marketing people and outside advertisers, met to discuss cigarettes designed for the “beginning smoker.”

A July 1980 memo from the company’s executive vice president, G. H. Long, to company Chairman Edward A. Horrigan reflects the company’s growing concern about losing market share to Philip Morris and in particular laments the fact that Philip Morris has 59% of the 14- to 17-year-old market and that RJR’s share of that market has slipped to 19.9%.

Long’s memo said he expected that company initiatives that year would increase RJR’s share of that market.

Most Smokers Start Younger Than 18

A large body of academic research shows that the vast bulk of smokers--about 89%--start before age 18. Thus, the companies need to attract smokers at the earliest age possible.

RJR officials have consistently denied--particularly in response to criticism of the Joe Camel campaign--that they target kids under 18. On numerous occasions, they have said the term “younger adult smokers”--which appears in a number of RJR documents released earlier--is a reference to people 18-24, not to younger teenagers.

Still, one 1980 document reflects that RJR was growing worried that some company documents were referring to the 14- to 24-year-old market. A memo discussing “Younger Adult Smokers--Terminology” suggested changing certain terminology used in the company’s internal communications.

“The specific terms that were to be erased from RJR’s vocabulary were redacted from the copy of the document produced” in the Joe Camel litigation, said San Diego attorney Patrick Coughlin, the lead lawyer for the plaintiffs. However, the document notes that “it is important that we do not do anything that would leave the false impression that our real intentions” are to market to those under 18.

A year later, an internal memo directed RJR employees to continue to track underage smokers but not to refer to them that way. But the next year RJR contracted with a company to develop a model called “AGEMIX” that could be used to determine smoking incidence and smoking rates for individuals 12 and older.

“The true significance of these documents is that they show that RJR kept track of young smokers and took action to try to get the share of the youth market it felt it needed to survive in this industry,” Coughlin said.