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Attorney General Lockyer Announces 40-State Agreement with ConocoPhillips to Reduce Sale of Tobacco Products to Minors

Provisions Cover 10,463 Company-Owned and Franchise Outlets Nationwide
Wednesday, December 21, 2005
Contact: (415) 703-5837

(SACRAMENTO) – Attorney General Bill Lockyer today announced an agreement with ConocoPhillips under which the oil firm will adopt new procedures and contractual requirements to reduce sales of tobacco products to minors at 10,463 company-owned and franchise retail outlets across the country, including 1,211 in California.

“Our children are our future, but what kind of future will they have if they start a habit that kills?” asked Lockyer. “We, as a society, have a shared duty to protect our kids from cigarettes and other tobacco products. To its credit, ConocoPhillips has recognized its responsibility and taken an important step to become part of the solution.”

The agreement was signed by Lockyer, and the Attorneys General of 39 other states. It applies to outlets that operate under the Conoco, Phillips 66 and 76 brand names in 31 of the signing states, including California. The Attorneys General of nine states that currently do not have ConocoPhillips outlets signed the agreement. If the company opens stores in those jurisdictions, the outlets will be covered by the agreement.

The ConocoPhillips “Assurance of Voluntary Compliance” (AVC) is the eighth such agreement produced by an ongoing, multi-state enforcement effort which Lockyer has helped lead. Previous agreements cover, in the signing states, all Wal-Mart, Walgreens, Rite Aid and 7-Eleven stores, and all gas stations and convenience stores operating under the Exxon, Mobil, BP, ARCO and Amoco brand names.

In addition to the multi-state AVCs, Lockyer and Los Angeles City Attorney Rocky Delgadillo in December 2004 reached a similar, court-approved settlement with Safeway, Inc. That agreement covers 538 Safeway, Vons, Pavilions and Pak N’ Save stores in California. The settlement resolved a lawsuit brought by Lockyer and Delgadillo that alleged Safeway violated state laws designed to prevent tobacco sales to minors.

Combined, the AVCs and Safeway settlement cover roughly 55,000 retail outlets across the nation. The AVCs provide measures to reduce sales of tobacco products to minors by the nation’s top retail chain (Wal-Mart), number one drug store chain (Walgreens), largest oil company (ExxonMobil) and biggest retailer of tobacco products (7-Eleven).

Launched in 2000, the multi-state enforcement effort by a group of 32 Attorneys General focuses on retailers with poor records of selling tobacco products to minors. State laws prohibit such sales. The enforcement program’s goal is to secure the companies’ agreement to take specific corrective actions. The agreements incorporate “best practices” to reduce sales to minors, developed by the Attorneys General in consultation with researchers, and state and federal tobacco control officials.

The retailing reforms of the ConocoPhillips AVC explicitly apply to company-owned stores. The agreement, however, also calls for ConocoPhillips to take steps to ensure its franchisees comply with state laws governing the sale of tobacco products. For example, ConocoPhillips will revise its franchise contracts to specify that tobacco-product sales to minors can result in loss of the franchise.

The AVC limits in-store advertising of tobacco products to brand names, logos, other trademarks and pricing. Additionally, the agreement bans self-service displays of cigarettes and all other tobacco products. Aside from the advertising and self-service restrictions, the AVC also requires ConocoPhillips to:

● Check the ID of any person purchasing tobacco products when the person appears to be under the age of 35, and accept as proof of age only valid government-issued photo ID.

● Prohibit the following: use of vending machines to sell tobacco products, distribution of free samples, sale of cigarette look-alike products and the sale of smoking paraphernalia to minors.

● Hire an independent entity to conduct random compliance checks twice each year at all company-owned stores in the signing states.

● Train employees on state and local laws and company policies regarding tobacco sales to minors, including explaining the health-related reasons for laws that restrict youth access to tobacco.

The Attorneys General have long recognized that youth access to tobacco products ranks among the most serious public health problems. Studies show more than 80 percent of adult smokers begin smoking before the age of 18. Research indicates that every day in the United States, more than 2,000 people under the age of 18 start smoking and that one-third of those persons ultimately will die from a tobacco-related disease. Young people are particularly susceptible to the hazards of tobacco, often showing signs of addiction after smoking only a few cigarettes.

In 1999, Lockyer established a full-time Tobacco Litigation and Enforcement Section to enforce California laws regarding the sale and marketing of tobacco products. The section also enforces the national Master Settlement Agreement (MSA) reached with tobacco companies in November 1998.

Californians who suspect violations of state tobacco laws or the MSA can file complaints by calling 916-565-6486 at any time, or by writing to the Tobacco Litigation and Enforcement Section at P.O. Box 944255, Sacramento, CA 94244-2550. Additional information is available on the Attorney General’s web site at http://www.ag.ca.gov/tobacco/ .

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