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    Tobacco Companies Lose Lawsuit to Ban Ads

    R.J. Reynolds, Lorillard claim California's anti-smoking ads smear reputation.

    SAN FRANCISCO -- A federal appeals court on Tuesday threw out claims by two tobacco companies that argued California's tough anti-smoking ads unfairly smear their reputation, reported the Associated Press.

    Tobacco giants R.J. Reynolds Tobacco Co. and Lorillard Tobacco Co. sued the California Department of Health Services to stop a series of ads that it said vilify tobacco companies and their executives. One such ad shows cigarettes raining down on school children, while a narrator says, "We have to sell cigarettes to your kids. We need half a million new smokers every year just to stay in business."

    The companies claimed the ads violated their First Amendment right to free speech because they alleged that they were, in part, paying for them.

    Under state law, California uses part of the 87-cent tax for every pack of cigarettes sold to pay for health education, including a media campaign discouraging people from smoking.

    "The implication of the tobacco companies' argument is that industries subject to an excise tax are entitled to a special veto over government speech funded by the tax," Judge Raymond C. Fisher wrote for the 9th U.S. Circuit Court of Appeals, which ruled 2-1.

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