CEI Daily Update

Issues in the News

1.Legal

The Supreme Court rules against Philip Morris as part of an on-going legal fight over its sale and marketing of “light” cigarettes.

CEI Expert Available to Comment: Special Projects Counsel Hans Bader on the conflict in the case:

The Supreme Court’s ruling involved a lawsuit against Philip Morris for selling ‘light’ cigarettes, which supposedly understate the health risks of smoking. Philip Morris said its labeling of cigarettes is based on testing methods prescribed in minute detail by federal regulators, so it should be able to remove any such lawsuit against it from state court into federal court.

2. Business

Small businesses continue to struggle with the government’s Sarbanes-Oxley accounting rules.

CEI Expert Available to Comment: Center for Entrepreneurship Director John Berlau on the perverse consequences for investors:

But now, [Sarbanes-Oxley] is robbing investors of their rights to place their money in stocks that carry risk but also have potential for great returns. This law’s prescriptive mandates are making it more difficult for companies of the size that Home Depot, or even Wal-Mart, were in 1982 to raise money in America’s public capital markets. Even if someone were to come back from the future to 2007 with stock market data through 2032, he just might come up empty-handed if looking for growth companies with the successful returns for investors of Wal-Mart and Home Depot.

3. Energy

China slows the use of corn and other crops for ethanol production, citing an increase in food prices.

CEI Expert Available to Comment: Adjunct Analyst Dennis Avery on the trade-offs involved in producing biofuels:

There are significant trade-offs, however, involved in the massive expansion of the production of corn and other crops for fuel.  Chief among these would be a shift of major amounts of the world’s food supply to fuel use when significant elements of the human population remains ill-fed.

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