Judge Refuses to Dismiss Claims on Tobacco Firms
A federal judge declined a request by the tobacco industry to dismiss key advertising-fraud claims in the largest government lawsuit ever filed against cigarette companies.
Judge Gladys Kessler of U.S. District Court in Washington issued a ruling on Friday saying the ad-fraud claims would continue in the case, filed by the Justice Department more than three years ago and accusing the cigarette industry of conspiring to deceive consumers about the dangers of tobacco and cigarettes.
Her decision paves the way for federal prosecutors to keep pursuing $289 billion in damages, in a case which originated under former President Clinton and is scheduled to go to trial in September 2004.
The ruling came two days after a rare major legal victory for cigarette companies when a Florida appeals court last week threw out a $145 billion award from a class-action lawsuit brought on behalf of former smokers. The federal decision signals that the cigarette industry, beleaguered by a price war and a slew of new local ordinances prohibiting smoking in public places, still faces significant legal woes.
Cigarette companies had hoped to whittle down the scope of the massive suit, by asking for partial summary judgment on the advertising-fraud claims in the case. The companies argued that advertising and marketing have long been regulated by the Federal Trade Commission, and therefore shouldn't be a part of the government claims under the Racketeer Influenced and Corrupt Organizations Act.
"The chances are now only slight that the tobacco companies can blow up this case before trial through some sort of procedural ruling," said Richard Daynard, a professor at Northeastern University School of Law in Boston who works with anti-tobacco lawyers. "This is a powerful case. Any fantasy that Judge Kessler would be sweet-talked into dropping it is gone."
The suit, against all nine major tobacco companies and two nonprofit groups that did joint industry research and public relations, seeks tough restrictions on the marketing, manufacture and sale of tobacco products, as well as damages that are supposed to represent what the industry has earned since 1971 from 33 million people who became addicted to cigarettes as minors.
A spokesman for the Justice Department had no comment. In a statement, Philip Morris USA, a unit of Altria Group Inc., said the companies will file summary-judgment motions to dismiss the entire case later this year.
Separately, federal jurors awarded an Arkansas man more than $19 million Friday after finding that British American Tobacco PLC's Brown & Williamson Tobacco Co. sells a defective product that contributed to his wife's death. The verdict includes $15 million in punitive damages and $4,025,000 in actual damages in the smoking-related death of Mary Jane Boerner of North Little Rock.
"The Arkansas jury decision demonstrates that the litigation threat isn't over for the tobacco industry," said Mr. Daynard, the law professor who follows anti-tobacco suits.
A spokesman for Brown & Williamson, based in Louisville, Ky., said the company intends to appeal the verdict.