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Posted on 21-9-2004 Tobacco Giants On Trial by Mark Tran, September 21, 2004, The Guardian
The largest civil suit in US history begins today, pitting the justice
department against America's tobacco giants in a $280bn (£156bn) case.
In what the industry's top lawyer calls "the mother of all trials", the
government is accusing tobacco companies of deceiving the American public
about the health effects of smoking, of consistently denying that smoking
causes diseases and of repeatedly denying that cigarettes are addictive.
The tobacco companies are also accused of marketing "low-tar" cigarettes
as healthier, even though they are no less hazardous than normal
cigarettes.
The justice department is seeking $280bn in "ill-gotten gains" to cover
the health costs for past and future victims of tobacco-related illnesses.
According to the US government, smoking is the largest preventable cause
of premature death in the US, killing more than 400,000 each year.
Filed by the Clinton administration in 1999, the trial is expected to last
six months and feature testimony from more than 100 witnesses. Even before
it began, the two sides exchanged nearly 120m documents.
Government lawyers will begin presenting their case today in the courtroom
of US district judge Gladys Kessler in Washington but both sides appeared
equally confident before the trial.
"The government has provided extensive evidence to support our case. We
look forward to presenting it in court," said Peter Keisler, assistant
attorney general in the department's civil division.
"We do not have any plans to settle this case. We're focused on going to
trial, defending ourselves," said Peggy Roberts, a spokeswoman for Philip
Morris.
Alongside Philip Morris and its parent company, Altria Group, the other
defendants are R J Reynolds, Brown & Williamson, British American Tobacco,
Lorillard. Liggett, counsel for Tobacco Research USA and the Tobacco
Institute.
The companies deny any wrongdoing and say they have substantially changed
their marketing practices since 1998, when they signed a $246bn landmark
agreement with state attorney generals which severely restricted marketing
and subjected cigarette makers to oversight.
David Bernick, attorney for Brown & Williamson, says the government's case
ignores those reforms.
"It blinks away the reality of the profound changes that have taken place
both within the tobacco industry and in how tobacco is perceived by people
outside the industry," Mr Bernick said.
Like some individual states, the government initially sued to recover the
cost of treating sick smokers. Judge Kessler ruled the government could
not do that but did allow the justice department to sue under the
racketeer influenced and corrupt organisations act.
RICO, originally drawn up to fight the Mafia, is designed to seek remedies
where there has been a group effort to violate fraud statutes.
But anti-tobacco groups fear that if the Bush administration, which has
never hidden its dislike of the case, wins a second term it will drop the
suit or settle it on terms favourable to the tobacco companies. Another
question mark over the case is an appeal by the industry challenging
whether the government has the legal authority to pursue the $280bn
penalty.
In May, Judge Kessler ruled against the tobacco companies, concluding that
the government was within its rights to seek "disgorgement" of past
profits. But the appeals court is scheduled to hear arguments in November
and if it overrules Judge Kessler, the biggest sanction will be off the
table.
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