Funding Shortage May ‘Force’ DOJ to Drop Tobacco Lawsuit

A "confidential memo" from lawyers at the Justice Department to Attorney General John Ashcroft "warn[s]" that the government could be forced to drop itslawsuit against the tobacco industry because the Bush administration has not proposed adequate funding to support the litigation, the Washington Post reports. The justice department suit, filed in 1999, alleges that the tobacco industry engaged in "fraudulent marketing practices" and seeks more than $100 billion in damages. The Post reports that the Bush administration has proposed "hold[ing]" the lawsuit's budget at $1.8 million, but department lawyers estimate they need $57.6 million in the next fiscal year to continue the lawsuit, which is entering the costly "discovery" phase. The March 12 memo from the department's Tobacco Litigation Team says that without federal funding, "we cannot maintain the action," adding that "there are no realistic prospects for a settlement" in the case. The memo states that without Ashcroft's support and additional funding, the lawyers would have to "seriously ... consider seeking authority to dismiss the case." As a senator, Ashcroft opposed the lawsuit. Justice Department spokesperson Mindy Tucker said the agency's budget is "neutral" on whether to continue the lawsuit.

The lawsuit has "been beset with budget troubles" in the past; last year, about $12 million was transferred from the Veterans Administration, the Department of Defense and HHS to pay for the litigation. The Post reports that the Bush administration is looking to Congress to provide funding for the lawsuit under a "similar arrangement" this year, but the agencies are "balking" at such a move. The tobacco industry would "welcome" the dismissal of the suit, the Post reports. In 1998, the industry settled lawsuits filed by 46 state governments for $240 billion over 25 years, and last year a Miami jury awarded "sick Florida smokers" $145 billion in punitive damages in a class action suit (Eggen/Kaufman Washington Post, 4/25).