Reynolds Tobacco Hails Appeals Court Ruling
WINSTON-SALEM, N.C., Nov. 16 /PRNewswire/ -- Labor union health funds and insurance companies suing the tobacco industry received another major setback this week from the U.S. Court of Appeals for the Seventh Circuit in Chicago, the fourth federal appeals
The unanimous decision, issued late Monday, dismissed two separate lawsuits that had been consolidated for appeal. One lawsuit was brought by Blue Cross and Blue Shield insurers in six states, while the other was brought by a number of union health care trust funds.
``In writing the decision for the court, U. S. Circuit Judge Frank Easterbrook clearly saw through the plaintiffs' efforts to strip away and circumvent the tobacco companies' traditional legal defenses,'' said Thomas F. McKim, assistant general counsel for R.J. Reynolds Tobacco Co. ``Juries have repeatedly rejected efforts to find the industry liable for various injuries alleged to be smoking related.''
In this regard, Judge Easterbook wrote: ``The outcome of smokers' suits is why the Funds and Blues want to sue in their own names; they choose antitrust and RICO because, in the Blues' words, 'assumption of risk, contributory negligence and similar defenses are not pertinent.' This is exactly why plaintiffs must lose. A third-party payor has no claim if its insured did not suffer a tort.''
McKim also commented: ``The court's analysis spotlighted flaws in these lawsuits that are common to the suit filed against the tobacco industry by the Department of Justice on Sept. 22, such as allegations that the insurance companies and trust funds were unaware of the health risks associated with smoking.''
Judge Easterbrook points out that insurance companies `` ... have on their staffs physicians with ready access not only the Surgeon General's conclusions and medical databases, but also direct access to information about health costs. Of all entities in society, insurers have the best information about the relation between smoking and health problems.''
McKim noted that the judge's analysis of what insurance companies know about smoking and health could just as easily be applied to the U.S. government.
R.J. Reynolds Tobacco Company is a wholly owned subsidiary of R.J. Reynolds Tobacco Holdings, Inc. (NYSE: RJR - news). R.J. Reynolds Tobacco Company is the second-largest tobacco company in the United States, manufacturing about one of every four cigarettes sold in the United States. Reynolds Tobacco's product line includes four of the nation's ten best-selling cigarette brands: Winston, Camel, Salem and Doral.