Tobacco Lawsuit Trial: A Closer Look at What's Happening

Summary

A major tobacco trial is currently underway in the United States. This trial was initiated after a group of citizens and organizations filed a lawsuit against the tobacco industry in order to recover costs of health care services related to smoking. This is the first major trial against the industry since a landmark class action settlement in 1998.


The current lawsuit argues that the tobacco industry is liable for the health care expenses incurred by individuals due to smoking-related illnesses. They claim that the defendants, which include tobacco companies Philip Morris USA, R.J. Reynolds Tobacco Co., and Lorillard Tobacco Co., were aware of the health risks associated with smoking yet deliberately omitted warnings to consumers and engaged in deceptive marketing practices that concealed the truth about these dangers.

The current trial will focus on 3 main questions. The first is whether the tobacco industry engaged in deceptive marketing practices that misled consumers about the risks of smoking. The second is whether the industry should be held liable for health care expenses due to smoking-related illnesses. The third is whether the industry's actions constitute a public nuisance.

The jury will have to decide whether the tobacco industry breached the duty of care that is owed to consumers. If the jury finds in favor of the plaintiffs, it could result in billions of dollars in damages for health care expenses incurred by individuals due to smoking-related illnesses. This trial is widely viewed as a major test case for the future of the tobacco industry and its ability to continue marketing its products.

A major tobacco trial is currently taking place in the United States that has the potential to set a major precedent for the industry. The lawsuit, brought by citizens and organizations, is seeking to recover costs of health care services related to smoking-related illnesses. The tobacco companies named in the lawsuit are accused of having been aware of the health hazards associated with smoking yet omitting warnings to consumers and engaging in deceptive marketing practices to conceal the truth. The jury will decide whether the companies breached their duty of care to consumers and should be held liable for health care expenses. The outcome of this trial will have a significant impact on the future of the tobacco industry and its ability to market its products.
 

Tobacco Trial Underway in Florida

The first major trial involving tobacco companies and Florida's effort to recover costs associated with treating sick smokers is underway. The tobacco companies, including Philip Morris USA and R. J. Reynolds Tobacco Co., are being sued for more than $3.3 billion in medical costs.

This is the first of a number of trials in which state and local governments are seeking to hold the tobacco companies accountable for the consequences of smoking. The governments claim that the tobacco companies concealed the health risks of smoking and that they deceptively marketed their products as safe.

The trial began in January 2000 in Miami, with Judge Robert Kaye presiding. The panel of six jurors, consisting of four women and two men, will be asked to decide whether the tobacco companies should be held liable for fraudulent and deceptive practices. The lawsuit claims that this fraud caused smokers to become ill and that it has cost the state billions in medical costs.

The Florida case has been consolidated with five other similar suits from other states, including California, Texas, Minnesota, and Massachusetts. If the Florida court decides in favor of the tobacco companies, then the other states' lawsuits will be dismissed. However, if the court rules in favor of the state, the tobacco companies will be forced to pay millions of dollars in damages.
 

Tobacco Companies Responsible for Billions in Damages?

Today, more than twenty years after the first lawsuit against tobacco companies was filed, the tobacco companies are facing the possibility of providing billions of dollars in compensation to governments across the United States. Governments are seeking reimbursement for medical care of sick smokers, as well as punitive damages to deter the deceptive practices of tobacco companies.

The current tobacco trial in Miami is the first such trial in decades and will set an important precedent for how other state and local governments will handle these cases. If the tobacco companies are ultimately found responsible for the health consequences of smoking, then they will be liable for billions of dollars in damages.

Oral arguments in an appeal to the country's largest ever civil racketeering lawsuit, in which the federal government is seeking $280 billion from the tobacco industry, began Wednesday in Washington, DC.

The lawsuit, filed in 1999, claims the nation's tobacco companies violated civil provisions of the federal Racketeer Influenced and Corrupt Organizations Act, known as RICO, enacted in 1970 as part of the Organized Crime Control Act. The first two counts of the government's complaint sought money for federal healthcare costs related to smoking and were rejected; the third and fourth counts deal with alleged RICO violations.

The civil complaint alleges tobacco companies have denied that smoking cigarettes causes disease and that cigarettes are addictive, used marketing techniques to make their products attractive to children, and conspired to market cigarettes consumers believed were less hazardous when in fact they were not. With the shared goal of maximized profits, the complaint states, the defendants organized and conspired to deceive consumers for 50 years—the effects of which continue in the present. Without restraint, the government argues, ''defendants are likely to continue their unlawful activities into the future.''

The government seeks ''equitable relief, including the disgorgement of defendants' ill-gotten gains.''

The defendants—Philip Morris USA Inc. and its parent Altria Group Inc., R.J. Reynolds Tobacco Co., British American Tobacco Ltd., Brown and Williamson Tobacco Corp., Liggett Group, Inc., and Lorillard Tobacco Co.—argued in the appeal that the RICO law does not include monetary relief as an available remedy.

The bench trial began Sept. 21, with U.S. District Judge Gladys Kessler presiding, and could, after the examination of millions of documents and hundreds of exhibits and witnesses, last more than half a year if the appeal is not granted.

Department of Justice Civil Division spokesman Charles Miller said Wednesday that the suit is of particular significance in that ''it is taking on one of the largest industries in the United States and, for that matter, the world, and the size of the monies we're asking for (and) the fact that this is an industry that has made a profit that has been injurious to health.''

A spokesman for Altria Corporate Services said the government is facing an uphill battle in trying to prove that the industry is conspiring to defraud now and in the future—especially after the 1998 Master Settlement Agreement, in which the industry agreed to reformed marketing practices and payments to 46 states of almost $250 billion for tobacco-related healthcare costs.

''It's going to be very difficult for the government because this is a changed industry,'' said John Sorrells, an ACS director.

''I guess the bottom line is, we feel like we've done nothing wrong in the past but certainly when you look at the 1998 Master Settlement Agreement, there is a changed industry out there.''

But antismoking activists want to see the industry held accountable.

If tobacco companies didn't directly conspire with each other, ''they definitely conspired within their own companies'' to defraud the public, said Chris Bostic, general counsel for the antismoking organization Action on Smoking and Health.

''Since the Master Settlement Agreement, the tobacco industry has done a masterful job of trying to change their image from being a renegade industry to being a good public citizen, and it seems to be all flash. They haven't actually done anything to reduce smoking or to reduce teen smoking but they want to be seen as responsible,'' so the negative publicity brought by a loss or settlement would be a good thing, Mr. Bostic said.

The suit will move forward and ultimately be decided upon the facts unearthed in tens of millions of internal tobacco-industry documents, he said.

''The devil's probably going to be in the details, and they're going to have to show that there was collusion between the companies to defraud the public this way.''

G. Robert Blakey, University of Notre Dame law professor and author of RICO legislation, stated Wednesday in an email that it is appropriate to charge the industry with racketeering.

''The facts fit the statute. The industry morphed into a front for drugs (nicotine, which is akin to heroin and cocaine) dealers. Cigarettes sold to kids, as they are, are not legal products: they are addictive and lethal,'' Mr. Blakey wrote.

According to the Centers for Disease Control and Prevention, 22.5 percent of American adults are smokers, and smoking causes an estimated 440,000 deaths annually.

''It's the leading preventable cause of death in the United States,'' said Joel London, press officer for the CDC Office on Smoking and Health.

Comprehensive tobacco-control programs need sustained funding to work, he said; with the help of such programs and youth media campaigns, smoking among high school students has been on the decline since 1997.

''If we don't see sustained efforts, then we're concerned that there may be continued slowing in the decline or even a reversal in smoking trends among youth,'' he said.

Though $280 billion seems like a huge amount of money, Mr. Bostic said, ''it's been estimated that between direct medical costs and loss of productivity, that tobacco use in this country costs around $130 billion a year, so what they're asking for is only a little over two years' worth of damage being done.''

Though the first two counts against the tobacco industry were dismissed, Judge Kessler has denied all 10 summary judgment motions filed for by the defense while granting several summary judgment motions wholly or in part for the plaintiff.

In July, Judge Kessler fined Philip Morris USA $2.75 million for deleting emails that may have been found relevant to the case.