PR Firm Surprises SF Bar Owners, Officials with Dozens of Applications to Sell Tobacco

December 13, 2013

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Anti-tobacco activists ask if applications are an attempt to return to the days when smoking and drinking were ubiquitous.

By Genevieve Bookwalter

A Missouri marketing company has applied for permits to sell tobacco at dozens of bars and clubs around San Francisco, a move that surprised both public health officials and bar owners who said they had no idea someone was applying to sell tobacco at their establishments without permission.

The Kerry Group LLC, based in the St. Louis suburb of Fenton, Missouri, is a high-end marketing and event company whose clients include Shell Oil, Disney and Anheuser-Busch InBev, among others.

Between Oct. 31 and Dec. 2, the San Francisco Department of Public Health received 25 applications to sell tobacco signed by The Kerry Group’s Chief Financial Officer Clinton Minx, according to records obtained from the San Francisco Department of Public Health through a California Public Records Request.

The tobacco applications were submitted under business name The Kerry Group LLC. But the addresses listed belonged to existing establishments throughout the city, from dance clubs in the Marina and Castro to an upscale bar in the Financial District.

Larry Kessler, senior environmental health specialist in the San Francisco Department of Public Health, handles tobacco sale applications for the city. For one company to take out so many permits over a short period of time, he said, is “highly unusual.”

“As long as I’ve been running this program, I’ve never seen anything like this,” said Kessler, who has been in his current position with the department about two years. Most new tobacco sale applications, he said, are for things like store ownership changes or a new 7-Eleven.

But the move felt familiar to Bob Gordon, project director for the California LGBT Tobacco Education Partnership. Gordon said the list of tobacco applications reminded him of the days when smoking and drinking were ubiquitous, before California banned lighting up in almost all bars and clubs in 1998.

Back then, Gordon said, tobacco companies regularly paid bars to promote their products, complete with branded napkins, clocks and bar mats, and attractive bartenders selling cigarettes alongside beer and cocktails. The tobacco companies would list those bars in flashy ads in local publications.

“If there’s some attempt to sell tobacco or have a permit in a bar, that’s turning the clock back on an environment where the tobacco industry isn’t welcome,” Gordon said.

Bar owners say they weren’t looped in

Meanwhile, bar owners didn’t seem to be in on the permits (see the full list of permit requests below). Many appeared caught off-guard by the idea that someone might apply to sell tobacco at their business without permission. Some said they had been approached about hosting a cigarette promotion, but none said they had definitively agreed to or confirmed an event.

“We’ve been getting multiple requests for (tobacco) promos and we keep denying them,” said Chris Hastings, owner of The Lookout in the Castro, who wondered how someone could be permitted to sell tobacco there without his permission.

“We’re not interested in doing promos for cigarettes and we don’t plan to change that,” Hastings said.

At The Napper Tandy in the Mission, owner Marissa Browne was taken aback by the idea that someone would apply for a license to sell tobacco in her bar without consulting her.

“No. No one stopped in and talked to me about selling tobacco,” Browne said.

Other bar owners said they sell cigarettes already, and weren’t sure why someone else would apply for a license to sell cigarettes there, too.

Gordon, with California LGBT Tobacco Education Partnership, wondered if The Kerry Group secured a list of permits in advance, to have them in place if and when a bar agreed to a tobacco promotion.

Plans are hazy for tobacco permits

Meanwhile, Kerry CFO Minx declined to comment on whether The Kerry Group asked bar owners before applying for permits; the type of promotion or event his company has planned with the permits; or which tobacco company his firm is working with.

“I’m just the person who applies for the license,” Minx said.

Minx also said he did not feel comfortable talking about whether the tobacco permits were related to a job ad posted on The Kerry Group’s employment webpage, which called for a San Francisco “Nightlife Field Market Manager” to “help execute a program for our tobacco client.”

Meanwhile, “case studies” on The Kerry Group’s website show high-end events featuring Justin Timberlake’s 901 Tequila; private Pennzoil VIP parties at Tim McGraw and Kenny Chesney’s “Brothers of the Sun” country music tour; and a “health and fitness tour” featuring trainers and a traveling exercise studio and timed with the season start of “HawthoRNe” television series on TNT.

The Kerry Group’s “About Us” tagline reads: “We create interactions with our consumers and trade partners, to change preferences and behaviors, and ultimately create brand engagements that last beyond a single moment in time.”

Seeing that “the next generation is tobacco-free”

Applying for and receiving a permit to sell tobacco in San Francisco remains relatively easy—but somewhat expensive—for The Kerry Group or anyone else doing business in the state. That’s despite efforts by city and California governments to curb smoking due to documented health risks, including cancer.

Under California’s Cigarette and Tobacco Products Licensing Act of 2003, anyone selling cigarettes, cigars or other tobacco products in the state must apply for a retail license with the California Board of Equalization. The license costs $100, and must be renewed each year. There is no fee to renew.

In San Francisco, those selling tobacco also must apply for a city license, which is renewed annually. That license runs $282 each year, according to the Department of Public Health website. The cost to apply for a license is $74.

As a result, the estimated total bill is $11,400 for The Kerry Group to take out licenses to sell tobacco at 25 bars and clubs in San Francisco for one year.

Tobacco licenses are unlike alcohol licenses in that there is no limit on the number of businesses that can sell tobacco in the city or state. With alcohol, local governments dictate how many businesses can sell it and where, and whether a shop or restaurant can sell just beer and wine or hard alcohol as well.

State tobacco permits do not carry restrictions on the type of product for sale, or the number of businesses selling it in a city. In San Francisco, pharmacies are not allowed to sell tobacco products.

Efforts are underway in San Francisco to increase those restrictions. Supervisor Eric Mar announced this month early steps to limit the number of tobacco permits issued in the city, but those efforts would not focus on bars. His spotlight is on neighborhoods with high concentrations of tobacco sellers, and could reduce the number of sellers through attrition. For example, when a business loses its tobacco license through a change of ownership, the city might not renew it if the concentration of businesses selling tobacco in that neighborhood is deemed too high.

Mar said he was not ready to discuss The Kerry Group’s permit applications specifically. But, he said, “I am dedicated to finding solutions to the number one cause of death and disability in our community. I am really devoted to seeing that the next generation is tobacco-free.”

Permits Requested

 

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