Denver Station Indefinitely Delays Cannabis TV Ads; Sacramento Dispensary Spot Flashback; Newsom Report Ad Curbs

Screen grab from a vape pen ad.

Citing “concerns about the lack of clarity around federal regulations that govern broadcast involving such ads,” the Denver affiliate of The E.W. Scripps Company, America’a 11th largest television station group, suspended plans to broadcast advertisements for two cannabis businesses.

The Denver Post reports:

Privately, many in the industry note that marijuana is still prohibited federally and TV stations are federal licensees. There is widespread concern among broadcasters that, if they were to air marijuana advertising, an aggressive federal prosecutor could decide to prosecute a station owner as aiding or abetting an illegal activity.

http://www.thecannabist.co/2015/07/20/kmgh-channel-7-denver-marijuana-ads/38272/

KMGH-Channel 7 had followed strict guidelines on the content and timing of the ads, having scheduled the ads to run after 10 p.m. when the vast majority of the audience is over 21. Nielsen data indicates ABC’s late-night program, “Jimmy Kimmel Live,” fits that bill.

Here are the ads:

Here is the spot widely regarded as the first medical cannabis television advertisement, which aired on Sacramento’s Fox 40 on Aug. 30, 2010:

From Archive.org’s Wayback Machine:

FOX40 To Air Nation’s First Medical Marijuana Advertisement Monday
Ad promoting cannabis dispensery expected to air Monday during morning news program “FOX40 Live”

By Matthew Keys FOX40 News
http://www.fox40.com…0,5605124.story
August 30, 2010
FOX40 To Air Nation’s First Medical Marijuana Advertisement Monday

SACRAMENTO – Sacramento’s FOX affiliate KTXL “FOX40” has been known for delivering many firsts to the Sacramento area. The station was first with a satellite news truck, first on social media websites Twitter and Facebook, and first with local, national and global breaking news. Monday morning will see another first — the first paid advertisement for a medical marijuana dispensary, thought to be the first time an ad for marijuana has ever aired on mainstream television.

The thirty-second ad, paid for by Sacramento-based “CannaCare” and produced by KTXL, shows various people delivering testimonials on the benefits of marijuana when used for medicinal purposes. Text at the bottom of the advertisement indicates that marijuana can be used in the relief of many diseases and illnesses, including diabetes, HIV, Hepatitis C and hypertension among others.

Marijuana is shown at all throughout the advertisement, and the word “marijuana” is never used. Instead, patients and the ad itself refer to pot as “cannabis.”

KTXL’s Acting General Manager Mike Armstrong says the CannaCare advertisement is likely the first such ad promoting medicinal use of marijuana to run on a mainstream television outlet ever.

“It is a matter of record within the medical community that medical marijuana can have positive results in helping relieve nausea and vomiting among cancer patients receiving chemotherapy and increasing appetites among AIDS patients,” Armstrong said in a statement e-mailed to FOX40.com, alluding that the ad is no different from that of any medicine advertised by pharmaceutical companies on local television channels and cable networks for decades.

“Like so many other products advertised legally in media, it is a drug,” Armstrong added. “When viewers watch the [advertisement] on air, they can see it’s simply identifying this as an avenue to take if your doctor thinks it will help you feel better.”

KTXL will air the advertisement during the station’s breakfast news and entertainment program “FOX40 Live.”

“I’m curious what viewers will think about this,” KTXL News Director Brandon Mercer said Friday evening. “We believe in giving the viewers a strong voice in our news products, and we certainly are going to hear a lot of opinions.”

When asked how he felt about the ad airing during a news program, Mercer responded with “no comment,” but later went on to say the station would dive into more details surrounding the ad during KTXL’s evening news program “FOX40 News at 10pm.”

The station is not running the “CannaCare” spot as a public service announcement, but instead as a fully-paid commercial advertisement. As with most television advertisement, information as to how much the station was paid to produce and air the spot was not expected to be publicly disclosed.

Advertisement promoting marijuana use, even for medicinal purposes, has come under debate recently when Facebook.com decided not to publish an ad promoting the legalization of pot for recreational use, which California voters will decide upon in November of this year. Facebook determined the advertisement did not meet its guidelines because it featured a marijuana leaf, which “is classified with all smoking products and therefore is not acceptable under our policies,” a spokesperson for Facebook.com told The Huffington Post.

The advertisement, paid for by the pro-marijuana group “Just Say Now,” later found a home on Google’s advertisement network.

For more on the CannaCare advertisement, including an interview with representatives from CannaCare, an interview with the advertisement’s producer and more on the station’s decision to air the ad, watch FOX40 News at 5:30pm and at 10pm. To see the ad in full, watch FOX40 Live Monday morning starting at 4:30am.

Copyright © 2010, KTXL-TV

https://web.archive.org/web/20101030170032/http://www.fox40.com/news/headlines/ktxl-news-potad0830,0,5605124.story

Meanwhile, the just-released report by the commission established by California Lt. Gov. Gavin Newsom to influence potential legalization initiatives ahead of his 2018 run for the governor’s office offers several scenarios on how to best control cannabis advertising:

There are several available policy tools to limit advertising and marketing. The first, and perhaps most effective policy tool is shaping the industry’s structure itself, specifically, creating an industry structure that works to limit the size and scale of any one actor. Without very large actors in the industry, few, if any, will have the resources for broadcast media advertising. This type of indirect limit on advertising rests on the government’s ability to license and regulate the industry. While a trade association may band together to advertise, its resources would likely be more limited than what a single large corporation could deploy.

A second approach is to limit in-store sales and marketing to only those retail locations or dispensaries where adults aged 21 and over can enter, and as discussed earlier, to limit what other non-cannabis products can be sold in these establishments so that adults enter with the sole purpose of purchasing cannabis. These choices can have the effect of preventing youth exposure to in-store advertising, and likewise that adults who were not intending to buy marijuana would not initiate a purchase due to point-of-sale marketing tactics.

The third tool is to adopt actual limits to advertising through legislation that meets constitutional standards.32 Because the federal government regulates broadcast media such as TV and radio, and because the Controlled Substances Act specifically bars advertising of a Schedule I controlled substance, marijuana advertising would not have federal constitutional protection. State constitutional protections might apply to some mediums of advertising (perhaps not those explicitly regulated by the federal government) and some types of restrictions, for example, those aimed at limiting exposure to youth. Whether and how state constitutional protections for this form of advertising would affect the ability of state and local government to regulate it in certain media requires further analysis.

The fourth policy tool is the denial of tax deductions for business advertising. Under section 280E of current income tax law, taxpayers cannot deduct the expenses of cannabis advertising on their federal returns. Similarly, individual taxpayers cannot now deduct those expenses on their California returns. There is no federal or state Constitutional right to deduct advertising or marketing expenses for any business, cannabis related or not. To be sure, denying state tax deductions would not eliminate advertising, but that approach would make it somewhat more costly. However, when legal operators are shouldering the costs of regulation, licensing and compliance, as well as other tax burdens, without the benefit of regular business tax deductions, such an additional burden at the outset may be too onerous.

A different but related approach is to limit the overall extent and types of marketing to adults, and in particular, to regulate sales practices that draw in new users (bundled sales for discount with other products, free offers with purchases of other products, etc.) or that may encourage regular or habitual use of marijuana (bulk discounts, coupons, loyalty points, etc.).

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