Lawsuits

National

Department of Justice Lawsuit Update
Click to view the history of the case through August 8, 2005.
 
In late June, six public health groups petitioned the Court to allow them to “intervene” by offering advice to Judge Kessler on the necessary and appropriate “remedies”, as outside experts on public health. The six public health groups are as follows:

• Tobacco Free-Kids Action Fund
• American Cancer Society
• American Heart Association
• American Lung Association
• Americans for Nonsmokers’ Rights
• National African American Tobacco Prevention Network

Judge Kessler granted the motion and on August 31, 2005, the six public health groups filed a brief that recommends strengthening the remedies proposed by the government and urges the Court to:

• Require the cigarette companies to pay $4.8 billion annually to fund a comprehensive smoking cessation program.
• Require the companies to pay $600 million annually to fund public education campaigns in three areas – youth prevention, light/low-tar cigarettes and secondhand smoke.
• Prohibit practices the companies have used to market to children, deter smokers from quitting and mislead the public about the harms of smoking and secondhand smoke.
• Set annual targets for reducing youth smoking rates and fine the companies if the targets are not met.
• Ban terms like "light" and "low-tar" that mislead smokers into believing that some cigarettes are safer.
• Require public disclosure of internal industry documents, including detailed marketing data.
• Appoint independent monitors to ensure the companies do not continue to violate the law in the future

The remedies sought must prevent and restrain future RICO violations and must come from the information contained within the trail record. The intervenors emphasize that no single set of remedies can solve the tobacco control issue, and therefore continued work on the state and local level is still very much needed.
 
On September 1st, Judge Kessler accepted four amicus briefs filed by Regents of the University of California; Essential Action and others; Tobacco Control Legal Consortium and others; and Citizens' Commission to Protect the Truth. The rest of the month of September involved the defendants’ responses to these briefs followed by responses from the Government and the intervenors. On October 9th, the defendants filed a one-page brief summarizing the significant areas covered during witness testimony.
 
On October 14th, the Supreme Court declined to hear the government's appeal of a lower court ruling barring the disgorgement, or recovery, of $280 billion in illegally obtained tobacco industry profits as a remedy in the case. The Supreme Court, as is typical, has not given a reason for its rejection of the appeal, but the tobacco companies claim that such a decision would be imprudent prior to a decision of liability in the case.
 
Should Judge Kessler finds the tobacco companies liable, it is possible that the disgorgement issue could arise as part of such an appeal of the remedies she imposes. All exhibits must be filed by November 15th, so judgment will likely not occur until after that date.

Action on Smoking and Health urges states to sue R.J. Reynolds over Eclipse cigarettes
Action on Smoking and Health (ASH), the nation's oldest antismoking organization, has urged the nation’s Attorneys General to sue R.J. Reynolds for making misleading claims about the alleged health benefits of its Eclipse cigarettes, in violation of the Master Settlement Agreement. Although 37 attorneys general have warned RJR about a lawsuit over its advertising, only Vermont has thus far filed suit. Click for more information.

Court denies motion by Lorillard for re-argument in case against American Legacy Foundation
Vice Chancellor Lamb of the Chancery Court of Delaware denied Lorillard’s motion for re-argument in American Legacy Foundation v. Lorillard Tobacco Company. On August 22nd, his decision found in favor of Legacy, stating that the foundation has not vilified the tobacco industry nor violated the terms of the Master Settlement Agreement. Click for more information.

Lung Cancer Alliance asks for tobacco industry-funded research
The Lung Cancer Alliance (LCA), the only national organization dedicated to advocacy on behalf of lung cancer patients and those at risk for the disease, has submitted a request to the United States District Court to require the tobacco industry contribute to a fund to support independent research on the diagnosis, treatment, and cure of lung cancer, as well as to the development of a national program on early lung cancer detection. The request is related to the case of the United States of America vs. Phillip Morris, USA, Inc. and other tobacco companies. Click for more information.

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Canadian Supreme Court rules that British Columbia can sue tobacco companies
The Canadian Supreme Court has ruled that British Columbia can sue tobacco companies to recover millions of dollars spent on health care for smokers over the past fifty years. The unanimous decision will allow the province to sue British American Tobacco and Altria Group's Philip Morris, and sets a national precedent for other provinces in the country. Click for more information.

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California:
 
California Supreme Court hears case regarding R.J. Reynolds distribution of free cigarettes
R.J. Reynolds is still fighting a $14.8 million fine, now up to $18 million due to six years of interest, for violating a 1991 state law prohibiting the free distribution of cigarettes and spit tobacco. In 1999, the company distributed a total of 108,155 packets to 18,834 adults attending six separate public events in California. The state of California, through its Attorney General, has filed legal action in the Los Angeles County Superior Court. The justices hearing the case have indicated during oral arguments that they might remand the case to the trial court to give the company an opportunity to prove it had a good-faith belief it was acting lawfully. Click for more information, or to view a case summary.

Massachusetts:
 
Massachusetts granted list of internet purchasers
As part of a court settlement, eSmokes, an online cigarette vendor located in Reston, Virginia, has agreed to turn over the names and addresses of Massachusetts residents who purchased more than 131,000 cartons of cigarettes between November 2003 and February of this year. Access to the list may allow Massachusetts to collect on $3 million in excise taxes. Click for more information.

Minnesota:
 
Minnesota Blue Cross Blue Shield able to release funds from tobacco industry settlement
Minnesota Blue Cross and Blue Shield has made available $411 million to fund clinics, prevention programs and individuals from the tobacco industry settlement it received in 1998. Funding was delayed by a class-action lawsuit by some policyholders seeking larger refunds. A court order in the Dakota County District Court ended the lawsuit. Click for more information.

North Carolina:
 
North Carolina judge orders payment to tobacco growers
North Carolina Business Court Judge Ben Tennille has ruled that tobacco growers in 14 states should be paid $318 million as a result of a 1998 settlement with cigarette companies, including $125 million to 80,000 farmers and quota holders in the state of North Carolina. Click for more information.

South Carolina:
 
South Carolina inmate with asthma is awarded money
An asthmatic inmate has been awarded $3,200 by the South Carolina Department of Corrections because they repeatedly exposed him to secondhand smoke, in violation of his rights. The state plans to appeal the decision. Similar suits have been dismissed. Click for more information.

Virginia:
 
Virginia farmers file lawsuit over federal tobacco buyout plan
Two Virginia farmers say the U.S. Secretary of Agriculture deviated from the original formula derived for the federal tobacco buyout plan. The farmers claim the agency submitted unconstitutional regulations when the buyout was included in the American Jobs Creation Act. The law, signed by President Bush in October 2004, calls for $9.6 billion to be paid to burley tobacco producers over a ten-year period and dissolved a quota and price support system. The farmers claim that the agency used a "convoluted formula" that included a number of terms and figures that were contrary to the formula originally drafted. Click for more information.

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