DOJ Requests $10B Penalty Rather Than Anticipated $130B in Tobacco Racketeering Case

Department of Justice attorneys on Tuesday "abruptly upset" the department's civil lawsuit against several large U.S. tobacco companies when during closing arguments they announced that the government no longer is asking for the anticipated penalty of $130 billion to fund smoking-cessation programs, the Washington Post reports. Now, DOJ is seeking $10 billion (Leonnig, Washington Post, 6/8). The lawsuit 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.

DOJ made the allegations as part of a larger federal lawsuit first filed by the Clinton administration in 1999 that accuses the tobacco industry of conspiring to mislead consumers about the dangers of smoking (California Healthline, 6/3). DOJ attorney Stephen Brody said that the government is asking for $10 billion to fund a five-year smoking cessation program, rather than seeking $130 billion over 25 years (Janofsky, New York Times, 6/8).

The $130 billion was recommended during testimony by Michael Fiore, a medical professor and director of a tobacco research center at the University of Wisconsin who chaired the HHS Interagency Committee on Smoking and Health subcommittee on tobacco cessation. Fiore's testimony was "widely considered" to represent the amount DOJ was seeking, according to the Post. DOJ "offered little explanation" for the change, but "sources and government officials close to the case said the trial lawyers wanted to request $130 billion ... but were pressured by leaders in the attorney general's office" to reduce the request, the Post reports (Washington Post, 6/8).

An unnamed person familiar with the situation said the change was "forced on the tobacco team by higher-level, politically appointed officials" from DOJ, including Associate Attorney General Robert McCallum (Levin, Los Angeles Times, 6/8).

Dan Webb, a lawyer for Phillip Morris, said, "We're very surprised," adding, "They've gone down from $130 billion to $10 billion with absolutely no explanation." Webb added, "It's clear the government hasn't thought through what it's doing."

William Corr, director for Campaign for Tobacco-Free Kids, said, "It feels like a political decision to take into consideration the tobacco companies' financial interest rather than the health interest of 45 million addicted smokers."

William Schultz, a former DOJ official who oversaw the lawsuit during the Clinton administration, said it was "disappointing, to say the least, that at the final stages of this litigation they have pulled their punches in such a significant way" (Washington Post, 6/8).

DOJ attorneys in closing arguments also outlined potential measures that could be enacted by U.S. District Judge Gladys Kessler if their lawsuit is successful. They include the following:

• A counter-marketing campaign to offset tobacco company claims;
  


• Full disclosure of the companies' scientific documents;
  


• Prohibitions against the use of words such as "light" or "low tar" in cigarette packaging and advertising (New York Times, 6/8);
  


• Restrictions on marketing practices such as price discounts and in-store displays (AP/Richmond Times-Dispatch, 6/8);
  


• Fines against companies if youth-smoking rates do not decrease;
  


• Statements from the companies that acknowledge a variety of health risks; and
  


• Court-appointed industry monitors to oversee remedial programs and remove executives who do not follow directives (Los Angeles Times, 6/8).

During attorneys' closing arguments, Kessler said, "Asking for judicial oversight of private corporations is a very weighty matter. So let me make clear the depth of my concerns." After Brody asserted that tobacco companies should be forced to recast public statements in a truthful way, Kessler said, "Who drafts those statements? What about the First Amendment? Do monitors come up with draft language? Do I make the decision about the exact language each and every defendant has on its Web site?" (New York Times, 6/8). Kessler's decision is not expected for weeks or months (AP/Richmond Times-Dispatch, 6/8).