From the Hotline

By Teri Henning
Pennsylvania Newspaper Association

Q: My newspaper received an ad for tax-free tobacco via the Internet. Is this legal?

A: The PNA recommends against running these types of ads. Under Pennsylvania law, a Pennsylvania resident who purchases cigarettes over the internet is still responsible for paying state taxes for those cigarettes. The Pennsylvania Department of Revenue has made it clear that they will attempt to collect these taxes from individual purchasers. As a result, an ad promising “tax free” purchases may be misleading to consumers. 

In addition, under Pennsylvania Law, anyone in possession of more than one carton of unstamped cigarettes can be found guilty of a criminal offense. The penalties range from a summary offense (fine up to $300 and up to 90 days in jail), to a misdemeanor (fine up to $15,000 and up to 3 years in jail), to a felony (fine up to $15,000 and up to 5 years in jail). Law enforcement can also confiscate vehicles used to transport cigarettes in violation of the law.

On August 29, 2002, the Department of Revenue announced that it intended to “crack down” on illegal internet sales of cigarettes. As part of this initiative, the Department has sent letters to newspapers that have run “tax free” ads, seeking information about the advertisers.

If your newspaper receives a letter from the Department of Revenue, you should contact your lawyer right away. We strongly recommend that your lawyer assist you in your response to the Department. 

Q: We received an ad from a Canadian pharmacy. Are there any problems with running it?

A: The PNA recommends against running these ads as well. The Food and Drug Administration takes the position that, in most cases, importing prescription drugs from Canada is illegal. The Pennsylvania Pharmacists’ Association agrees. In March 2003, the FDA sent a letter to an Oklahoma storefront business that assists U.S. citizens in the importation of Canadian drugs. In the letter, the federal agency warned the company that helping U.S. Citizens purchase medicines from Canada violates the Food, Drug and Cosmetic Act. The FDA has also raised safety concerns about imported drugs, and has warned consumers not to purchase them

Q: I have heard that the Federal Trade Commission is very concerned about misleading weight loss ads. Are there any guidelines that we can use to screen these ads?

A: Yes. You may recall that in November 2002, the Federal Trade Commission (FTC) convened a workshop to discuss false and misleading weight loss advertisements. Participants discussed how to reduce the number of deceptive weight loss ads and how the FTC could more effectively fight weight loss fraud. Among the topics discussed were the FTC’s perception that the media must engage in more self-regulation, and whether media outlets should be liable for publishing ads that are patently false and misleading. The FTC indicated that media liability was one strategy that it was considering. At that time, media experts raised constitutional and other, more practical, problems with holding the media liable for the content of these ads. 

The FTC has now announced its “Red Flag” education campaign, designed to assist media outlets in voluntarily screening out obviously false weight-loss product ads. To support the voluntary initiative, the FTC has released a media reference guide entitled “Red Flag: Bogus Weight Loss Claims”

For more information or to access the FTC’s media guide, please call the PNA’s Legal Hotline at (717) 703-3076, or go to the FTC’s website, at http://www.ftc.gov/redflag.