Department of Justice Calls for Court-Appointed Monitors for Tobacco Companies
Attorneys for the Department of Justice said in court documents filed on Monday that they will propose court-appointed monitors to "oversee the tobacco industry" in the event that DOJ wins a civil racketeering lawsuit against several large U.S. tobacco companies, the Reuters/Los Angeles Times reports (Reuters/Los Angeles Times, 3/24).
The lawsuit, filed in 1999, alleges that Brown & Williamson, Philip Morris USA, R.J. Reynolds, Lorillard Tobacco and the Liggett Group misled consumers about the health risks of smoking and directed multibillion-dollar promotional campaigns at children in violation of the civil Racketeer Influenced and Corrupt Organization Act. The lawsuit had sought $280 billion in damages and past profits.
However, an appeals court panel last month ruled that DOJ could not claim profit disgorgements and could only seek penalties that would prevent or restrain future violations. According to a brief sent to U.S. District Judge Gladys Kessler, who has overseen the lawsuit, DOJ currently seeks to require the tobacco companies "to fund sustained smoking-cessation programs that have been scientifically proven effective."
DOJ and the tobacco companies have met with a court-appointed mediator in an effort to settle the case. A potential settlement of the lawsuit likely would include provisions similar to legislation introduced in Congress last week, which would allow FDA to regulate tobacco product labels, the design of tobacco products and the sale of candy and fruit-flavored cigarettes (California Healthline, 3/22).
In the court documents, DOJ attorneys said that the court-appointed monitors would have the authority to recommend the dismissal of tobacco company officials in the event a judge found the officials violated court orders. However, DOJ attorneys said that they do not plan to seek the immediate removal of "senior tobacco industry executives" as a "broad remedy to prevent future wrongdoing," Reuters/Times reports.
DOJ attorneys last week told the court that one of their witnesses, Harvard Business School professor Max Bazerman, would call for "structural changes" in the tobacco industry, such as "the removal of senior management and changes in oversight and reporting arrangements."
In response to documents filed by DOJ, tobacco industry attorneys asked Kessler to reject the possibility of the removal of tobacco company officials and "any other new remedy proposals from the government," the Reuters/Times reports (Reuters/Los Angeles Times, 3/24).