Philip Morris Had Proposed Talks With Europe on Smuggling Lawsuit
Days before a federal judge dismissed a cigarette-smuggling lawsuit filed by the European Commission against some of the world's largest tobacco companies, Philip Morris Cos. proposed settlement talks, according to a letter filed with a federal court in B
Last week, the U.S. District Court in Brooklyn ruled the European Commission couldn't sue tobacco makers, because it wasn't directly harmed by the tobacco companies' alleged misbehavior. Still, Judge Nicholas G. Garaufis left the door open for individual European governments to file racketeering complaints that tobacco companies conspired to smuggle cigarettes across their nation's borders.
Several days before the case was dismissed, Philip Morris sent a letter to attorneys representing plaintiffs. In the letter, the company asked for a meeting to discuss "specific proposals, including steps that Philip Morris can take to support the governments' anticontraband enforcement efforts."
Luc Veron, a commission spokesman in Brussels, said the commission still is considering the content of the letter and had no further comment.
Philip Morris said it sent the letter in response to Judge Garaufis's suggestion that the two sides discuss ways to prevent cigarette smuggling, said William Ohlemeyer, vice president and an associate general counsel at Philip Morris. The company remains willing to talk, despite the dismissal of the suit.
Mr. Ohlemeyer said that Philip Morris usually takes a hard line against settling tobacco-related lawsuits, but the company supports the commission's stand against smuggling and is willing to work out an arrangement to help stop it.
As for the billions of dollars in taxes the 15 member nations say they lose annually because of smuggling, Mr. Ohlemeyer said money won't be the focus of the talks.
"If the commission's goal isn't to recover money but to force companies to help them deal with cigarette smuggling, ... we're willing to work collaboratively to help them," Mr. Ohlemeyer said.
Last year, the European Commission filed a civil suit against R.J. Reynolds Tobacco Holdings Inc., of Winston-Salem, N.C., and Philip Morris, of New York, saying the companies facilitated the smuggling of cigarettes into the European Union. The cigarette makers have denied the allegations.