New York Times Examines Potential Remedies in Justice Department Lawsuit Against Tobacco Companies

The New York Times on Saturday examined how the increased legal costs of a Department of Justice civil racketeering lawsuit against several large U.S. tobacco companies -- "one of the most costly civil cases ever prosecuted" by DOJ -- is "raising questions about what the government might gain with a victory." Legal costs for the lawsuit likely will reach "hundreds of millions of dollars" for both DOJ and the tobacco companies, and a bill currently under consideration in Congress addresses many of the issues raised in the case, the Times reports. Two courts have heard the lawsuit, which proceeded to trial last September, and the case could reach a third court in the future (Janofsky, New York Times, 4/2).

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 in February 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 month that would allow FDA to regulate tobacco product labels, the design of tobacco products and the sale of candy and fruit-flavored cigarettes (California Healthline, 3/24).

The appeals court panel decision has "cast doubt" on whether "remedies the government might seek ... would accomplish" more than the FDA tobacco regulation legislation, according to the Times. However, DOJ attorneys maintain that Kessler "has at her disposal a broad pallet of methods that could discourage future illegal acts" -- such as the establishment of a nationwide smoking cessation program that tobacco companies would sponsor at a cost of $5.2 billion annually over 25 years and a campaign against youth smoking that would require tobacco companies to pay $2,400 for every youth smoker in excess of a certain annual target number, the Times reports. In addition, Kessler could place restrictions on the marketing practices of tobacco companies, according to DOJ attorneys (New York Times, 4/2).