Tag Archives: tobacco litigation

Look for full-page anti-tobacco ads on Nov. 26th, 18 years in the making

This is a legal case going back to the previous century.

Waaaay back in 2006, a federal judge ordered Philip Morris and RJ Reynolds  to take out full-page newspaper ads admitting they lied for decades about the dangers of its products, and that ruling came as a result of a lawsuit filed by the U.S. Justice Department in 1999.

Because of various appeals, etc., Big Tobacco has managed to avoid taking out these ads for years and years. This is actually something Big Tobacco excels at — keeping shit tied up in court for decades. But, now all their appeals have been exhausted and the reckoning day is here.

So, these ads, which will appear in major newspapers across the U.S. in Sunday papers on Nov. 26 will have been in the works for 18 years. You may also see some ads on TV because of the same court ruling.

R.J. Reynolds, father of Joe Camel, estimates the ads will cost them $20 million. A pretty small drop in the bucket for the billions in profits RJR and Philip Morris have made in the past 18 years.

(I will have to pick up a Seattle Times on Nov. 26 to see if one of these ads appears there)

The full-page ads will address these four topics:

  • The adverse health effects of smoking.
  • Addictiveness of smoking and nicotine.
  • Lack of significant health benefit from smoking “low tar,” “light,” “ultra light,” “mild” and “natural’ cigarettes.
  • Manipulation of cigarette design and composition to ensure optimum nicotine delivery.
  • Adverse health effect of exposure to secondhand smoke

The secondhand smoke one suprised me a bit, since this became an issue way after 1999 (and 2006 for that matter). I can’t wait to see the ad.

 

 

Federal judge tells Big Tobacco, “quit wasting my damn time”

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Big Tobacco weasels

This is a great story.

I’ve posted earlier stories about as part of a Justice Department RICO (a federal racketeering law usually used against organized crime) lawsuit, Big Tobacco was ordered some time ago to come up with “corrective statements,” ie, full-age newspaper ads admitting that tobacco companies have lied and covered up about the dangers of smoking.

Well, those full-page ads have yet to show up, partly because Big Tobacco is wrangling big time with the courts about what it has to say in its “corrective” ads. This has actually been dragged out now for SEVEN years. (And that’s SEVEN years after all the appeals over the original order were exhausted). The final order was issued in May 2015, and still no ads.

The wording of the ads has been directed by federal court judge   Gladys Kessler (District of Columbia). The ads are supposed to hit on five major points:

* The adverse health effects of smoking;
* The addictiveness of smoking and nicotine;
* The lack of any significant health benefit from smoking “low tar” or “light” cigarettes;
* The manufacturers’ manipulation of cigarette design to ensure optimum nicotine delivery;
*  The dangers of exposure to secondhand smoke.

But the tobacco companies appealed. Apparently, the fifth total appeal filed by Big Tobacco in this case. Big Tobacco continues to try and weasel its way out of these corrective ads and Kessler is getting fed up:

From this story posted on the Consumerist blog:

“That is ridiculous — a waste of precious time, energy, and money for all concerned — and a loss of information for the public,” writes Kessler [PDF]. “The Court has no intention of following that path, although it is obvious that Defendants are, once again, attempting to stall any final outcome to this long-standing litigation.”

In her order, Kessler notes that the revision offered by the government and its allied public health groups should suffice, as it simply shortens the disputed preamble to “A Federal Court has ordered Altria, R.J. Reynolds Tobacco, Lorillard, and Philip Morris USA to make this statement…”

“The newly crafted preambles do not in any way send a message to the public that Defendants deceived them in the past,” explains the judge, “nor that Defendants are being punished for their previous conduct.”

Apparently, one of the things the tobacco companies are asking for is having their corporate names removed from the corrective statement (By the way, they are ALTRIA, RJ REYNOLDS and BRITISH-AMERICAN TOBACCO)

ALTRIA, RJ REYNOLDS, BRITISH-AMERICAN TOBACCO. First Amendment, bitches!

They’re also fighting over ticky-tack language issues, such as not wanting the word “ordered” in the ad, and wanting that word replaced with “determined.”

From the Consumerist story:

A lawyer for one of the firms representing the public health groups involved in the case tells theNational Law Journal that everyone is onto the tobacco companies’ tactics.

“I think it’s safe to say that [Kessler] believes that the defendants are trying to delay the issuance of the corrective statements and that’s certainly the concern that my clients have had for many, many years,” he explains, “that the defendants have done and continue to do whatever they can to delay the day of reckoning.”

 

 

 

Class-action lawsuit planned against American Spirit cigarettes

American Spirit

This story is actually a few weeks old, but I just now heard of it. I found out about it while arguing with someone who claims that American Spirit cigarettes are better for you than other brands (The FDA has warned American Spirit to stop with its “natural” and “additive-free” advertising.

Anyway, a class-action lawsuit being planned in Florida intends to take bolder action than the FDA. From the Santa Fe New Mexican:

A Florida law firm this week filed the first attempt at a class-action lawsuit against the Santa Fe-based company and its parent, Reynolds American Inc. of Winston-Salem, N.C., claiming the cigarette maker’s packaging and advertising are intended to mislead smokers into thinking American Spirit cigarettes are healthier than other tobacco products.

The FDA last August warned American Spirit to drop its advertising of being “organic” and “additive-free.” Now, since then, I’ve seen American Spirit ads in Sports Illustrated that still say “organic” and “additive-free,” however, I see in this story an explanation. The FDA told American Spirit to come up with a plan for “corrective actions.” So, even though they’ve been given a stern warning by the Feds, American Spirit has continued with its dubious marketing.

From the Santa Fe New Mexican:

The lawsuit filed (in October 2015) in U.S. District Court for the Southern District of Florida by Justin Sproule notes that American Spirit sales increased by 86 percent from 2009 to 2014, as compared to an overall 17 percent decline in cigarette sales in the United States during the same period. Just this week, Reynolds American announced that it had agreed to sell the international rights to the brand to Japanese buyers for $5 billion.

The complaint seeks damages on behalf of Sproule and others who “smoke American Spirits because they have been deceived by claims, labels and advertising into regarding them as safer than other cigarettes.”

Descriptions such as “additive-free,” “natural” and “organic,” the lawsuit says, “are patently deceptive, especially in today’s market, where these terms have a potent meaning for the health-and-environmentally-conscious consumer.”

The company also exploits its marketing message in other ways, the complaint says, by selling its cigarettes in health food stores. “And it accompanies its cigarettes with literature from ‘America’s leading natural foods teacher’ who claims that the cigarettes are medicinal and that Native Americans smoke such additive free cigarettes without developing cancer.”

I think it’s also interesting that the lawsuit is being filed in Florida. Florida has become a very unfriendly place for the tobacco industry. Many years ago, in what’s known as the Engle Case, the tobacco industry lost a massive $145 billion class-action lawsuit in Florida. The Florida Supreme Court threw that settlement out, saying the case couldn’t be decided on a class-action basis and that each victim (or victim’s family) that was sickened or killed by tobacco had to file their suits individually.

Since then, partly because of the way the Supreme Court ruling was written, which essentially said the plaintiffs were right, they just couldn’t sue on a class-action basis, there’s been a veritable cottage industry of lawsuits against the tobacco industry in Flordia. Several thousand lawsuits, in fact, and the majority of those cases that have been decided have been decided in favour of the plaintiffs. Hundreds of millions of dollars in settlements have been paid out and hundreds of millions more of settlements are still caught up in the appeals process.

I think because of this, a lot of attorneys who specialize in litigation against the tobacco industry have migrated to Florida. That’s where the action is, so to speak. So that doesn’t surprise me this class-action suit against American Spirit is coming out of Florida.

 

 

Think Progress: The gun industry watched what happened to the tobacco industry and took notice

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A very compelling read from Think Progress about how the gun industry watched regulators and the legal justice system cratered Big Tobacco, prompting the gun industry to take steps to make sure the same thing couldn’t happen to it.

Big Tobacco, while still vastly wealthy, is not nearly the political powerhouse that it was 25 years ago. The adult smoking rate has dropped from 42 percent to 17 percent in the U.S. over the past 50 years, smoking advertising has been seriously curtailed and few workplaces allow smoking anymore. Two things helped destroy Big Tobacco’s political influence — regulations and lawsuits. Big Tobacco fought, which minimal success (some, but not much), smoking bans, first on airplanes (a battle the industry ultimately lost) and then in restaurants and then in bars.  Now, more than 30 states have total smoking bans, another handful of states have smoking bans in restaurants and even in those states without smoking bans, most major cities have banned smoking in bars and restaurants.

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In the courtrooms, Big Tobacco really got spanked. The industry won lawsuit after lawsuit for years until through the discovery process in many of these lawsuits, internal industry documents were released showing that Big Tobacco absolutely knew since the 1950s that cigarettes caused cancer and were physically addictive and showed that for decades, the industry has been trying to market to teenagers.

Because of the release of these documents, Big Tobacco actually started losing lawsuits. A bunch of state’s attorneys general filed suit because of the costs of smoking to their Medicaid programs, and rather than fight these lawsuits and potentially lose, Big Tobacco agreed to the $280 billion Master Settlement agreement in 1998. Today, the tobacco industry continues to get nailed with lawsuits, a lot of them in Florida, costing them millions in legal fees and eventual settlements (though the industry is well-known for dragging these settlements out for years through appeals, people have received multi-million jury settlements.).

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The gun industry sat back and watched and took action to make sure the same thing couldn’t happen to it. The gun industry was facing similar types of class-action lawsuits which eventually crippled Big Tobacco politically.

From the Think Progress article:

Lisa Graves, executive director of the Center for Media and Democracy, told ThinkProgress that the NRA was “very afraid of the parallel between gun litigation and tobacco litigation, so it preempted that.” Through the American Legislative Exchange Council (ALEC) — the secretive free-market lobbying group that brings together conservative politicians and major corporate interests including the tobacco and gun lobbies — it pushed a “Defense of Free Market and Public Safety Resolution” to hurt Smith & Wesson’s ability to sell to law enforcement.

“ALEC helped to try to punish the one component of the industry that agreed to these measures,” Graves recalled, discouraging local police “from buying guns from Smith & Wesson — for daring to go along with safety [measures] designed to keep kids safe.”

When the NRA’s preferred candidate, George W. Bush, was inaugurated in January 2001, his new HUD secretary Mel Martinez quickly ended the department’s involvement in the lawsuits (the NRA strongly endorsed him three years later in his campaign for U.S. Senate in Florida). ALEC and the NRA worked at the same time to successfully encourage many states to prohibit local lawsuits against the gun and ammo industries.

Next, the NRA and its Congressional allies set about eliminating the threat of state or local action, once and for all. In 2005, Bush signed the Protection of Lawful Commerce in Arms Act, which effectively shielded the gun industry from legal liability when their products are used in criminal and unlawful activities.

So, the gun industry made sure to get legislation passed to make sure something like the 1998 Master Settlement Agreement or the Engle case in Florida could ever happen to it.

From the article:

A decade later, the law has been used to stop virtually all efforts to hold gun companies liable in court.

“I think that, had the really powerful litigation run its course, we would have had the same success on guns” as on tobacco, Graves said. “That tobacco litigation was historic… They were able to make some substantial progress and change the future — having information out there, showing how evilly the tobacco companies were behaving. So there was an effort to stop that for guns, which have huge number of deaths and injuries. We haven’t seen the same progress as you would have had these been allowed to go forward. ”

But the industry didn’t stop there. The gun industry also through legislation clamped down on research into gun violence. It was scientific research done by the Centers for Disease Control that helped break Big Tobacco’s power.

From the article:

Thanks to a 1996 law, pushed by the NRA and one of its life members, then-Rep. Jay Dickey (R-AR), the federal government does not do the same kind of in-depth research on gun violence and its prevention. The “Dickey Amendment” stipulated that no funds “made available for injury prevention and control at the Centers for Disease Control and Prevention may be used to advocate or promote gun control.” A 2012 appropriations law put similar restrictions on NIH funding for that year.

Though the NRA claims this was not its intent, the effect of the amendment was not simply that the CDC did not advocate for gun control, it stopped the Centers from doing almost any research on gun violence. And, according to a 2011 New York Times story, before the few remaining firearm-related studies funded by the CDC get published, the NRA gets a heads up “as a courtesy.”

Ted Alcorn, research director at Everytown for Gun Safety, told ThinkProgress in an email that his organization’s research has found that “after the gun lobby’s attacks on the Centers for Disease Control in the mid-1990s, the agency’s funding for public health research on gun violence fell more than 95 percent and publications in the field dried up.” Though groups like Everytown have worked to fill the gap, the lack of federal research has made progress on gun safety even more challenging.

The article also points out that while most doctors will talk to patients about their smoking, laws are being passed (Florida) prohibiting doctors from asking patients if they have a gun in the house. And it points out that while the majority of states and vast majority of cities have smoking bans, more and more states are passing laws allowing the open carrying of guns. Really, there’s never been a better time than now to be a gun owner in the U.S.

Thanks, unfortunately, to the lessons learned by the gun industry while watching the gutting of the tobacco industry’s political power.

 

Quebec court: Tobacco companies must pay $15 billion in damages to as many as 1 million people

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Big story out of Canada! Thanks very much to my friend Classical Gas for the tip.

A court in Quebec today ordered three Canadian tobacco companies — Imperial Tobacco, Rothmans Benson & Hedges and JTI-MacDonald — to pay $15 billion Canadian for “moral” and “punitive” damages.

This lawsuit began way back in 2012, but the roots of it go back much further.

From a CBC.com story:

“It’s a big day for victims of tobacco, who have been waiting for about 17 years for this decision. It was a long process — but arrived at the destination and it’s a big victory,” said Mario Bujold, executive director of the Quebec Council on Tobacco and Health.

The plaintiffs are a number of people who were sickened by smoking and/or their families. The groups alleged that Canadian tobacco companies:

  • Failed to properly warn their customers about the dangers of smoking.
  • Underestimated evidence relating to the harmful effects of tobacco.
  • Engaged in unscrupulous marketing.
  • Destroyed documents.

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    Lise Blais holds up a photograph of her husband, Jean-Yves Blais, who died from lung cancer after launching one of the two lawsuits, during a news conference on Monday in Montreal. (Paul Chiasson/The Canadian Press)

I’m not clear just how many plaintiffs there are (this sounds something like the Engle class action lawsuit in Florida), but according to the CBC, possibly as many as 1 million smokers and former smokers in Quebec will receive varying settlements. Here is the breakdown:

The plaintiffs with cancer who began smoking before January 1976 will get $100,000 each. Those who first lit up after that date are entitled to $90,000.

Those with emphysema will receive $30,000 in moral damages if they began smoking before Jan. 1, 1976, and $24,000 if they started smoking after that date.

For the almost one million Quebec smokers who were unable to quit, the breakdown comes out to about $130 per person.

From a wife of a smoker who died:

“I am so relieved with what has happened,” Lise Blais, whose husband Jean-Yves Blais initiated one of the lawsuits, told a crowd at a news conference.

“Did you stop to think what a cigarette is? It destroys you — your health is totally destroyed,” she said, holding up two photos of her late husband, who died in the summer of 2012 from lung cancer at the age of 68.

The companies plan to appeal. A lawyer for one of the companies made the weaseling comment that since the 1950s, Canadians have known the health danger from cigarettes. Hey, Pro-tip to weasel tobacco lawyer … tobacco lawyers have been trying to use that excuse since the beginning of Time, and for the past 20 years, it hasn’t saved their asses in court. You guys went to considerable time and expense to create doubt in smokers’ minds about the dangers of smoking, and the bill is coming due for your decades of lies and cover-ups.

 

 

Duh! story of the day. $23.6 billion judgement against RJ Reynolds unlikely to hold up

 

I talked about this in a post the other day. A jury last week awarded $23.6 camelbillion in punitive damages against RJ Reynolds in one of the thousands of Engle cases in Florida. I said that dollar amount would likely never hold up on appeal.

Well, sure enough, some legal experts have weighed in, saying it can’t possibly hold up, but it may not matter, because it might signal future huge punitive damages against RJR.

“Nobody thinks the $23 billion is going to remain,” said Richard Daynard, a law professor at Northeastern University and the chair of its Tobacco Products Liability Project.

Because of constitutional guarantees of due process, the Supreme Court has shown a reluctance to allow punitive damages that are far out of line with compensatory damages in the same case, he said. The court’s general guideline is that the ratio of punitive to compensatory damages should be below 10:1.

However, the compensatory damages in the case were roughly $16 million, which means, Daynard says, there could still be punitive damages up to $150 million.

“I worked with juries for several decades, and I cannot put my mind on what they are doing, but the Florida jury (in awarding a huge sum) seems to be sending a message,” said Duke’s Vidmar. “This is a statement from the jury that this was an outrageous behavior by the tobacco companies.

One thing I saw in this article, and something I have wondered about, is how much the tobacco industry has actually paid out in the Engle cases. The original class-action award was $145 billion, which was overturned by the Florida Supreme Court 8 years ago. Since then, RJ Reynolds has paid out $114 million in 15 resolved cases.  Another $180 million in damages are held up on appeal.

I also mentioned this in my my earlier post. These huge damages I think — eventually — will force RJ Reynolds to simply settle with the remaining defendants. Obviously $23.6 billion isn’t going to happen, but constant, never-ending $20 million here and $20 million there is going eat away at RJ. Might be better to just settle and get rid of the legal uncertainty.

“You’re going to have a lot more cases where juries could find themselves similarly outraged,” he said. “The reluctance of the tobacco companies to settle these cases, thinking they can handle the cases as a matter of course, may be a mistake,” Daynard said.

 

RJ Reynolds loses $23.6 billion jury judgement

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Wow, this is a big “wow.” A big wow that will likely get reduced upon appeal.

In one of the thousands of Engle liability cases in Florida, a jury awarded a settlement of $23.6 billion (yeah, billion) in favor of one of the 8,000 Engle plaintiffs. (The Engle decision was a Florida Supreme Court decision in 2006 overturning a $145 billion class action decision against Big Tobacco in favour of the plaintiffs. While the court upheld many of the merits of the case, it threw out the class action part of a lower court decision, meaning those 8,000 plaintiffs all have to sue individually.

So thousands of lawsuits in Florida have moved forward. This is by far the biggest jury judgement against R.J. Reynolds. The jury awarded $15 million in compensatory damages and $23.6 billion in punitive damages (to punish R.J. Reynolds for lying and covering up the true dangers of their product and the addictive nature of nicotine.). That’s one case … versus $145 billion for 8,000 plaintiffs.

Unfortunately, that punitive damage amount is so outrageous, I can’t imagine it will stand up to appeal. As much as I think it sends a message to the tobacco industry from the jury that “Wow, we really think you lied your asses off,” I don’t think it necessarily does a lot of good to make judgements so huge that they can’t possibly hold up. The tobacco industry has not been successful lately, especially in Florida, in winning these Engle cases, but they have been successful in dragging out appeals indefinitely. An appeal will be automatic in this case over such a large sum of money.

Anyway, there are literally hundreds more of these cases in Florida, and the tobacco industry has been consistently losing them, which is ultimately a good thing. I think ultimately, all these judgements will force RJ and Philip Morris to eventually settle with the thousands of Engle plaintiffs for an amount that for the tobacco industry will still be the “cost of doing business.” Because,  I figure even the tobacco industry has to get sick of constantly being in court all the time and constantly dealing with legal fees.

Oregon Supreme Court came, saw, then kicks Philip Morris’ ASS

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Philip Morris got its ass handed to it by the Oregon Supreme Court, which shockingly (to me, because the good guys rarely win these cases, at least completely win) upheld a jury award to the widow of a smoker killed by lung cancer. The Supreme Court ruled that Philip Morris must pay another $99 million to the widow of Jesse Williams, Mayola Williams. The original decision was made by a jury way back in 1999, but then got appealed and appealed all the way to the U.S. Supreme Court. The U.S. Supreme Court upheld a punitive damage of $79.5 million, but kicked part of the case back to the Oregon Supreme Court. That figure is now up to $99 million in part due to interest. OK, I know what you’re thinking — $99 million is nothing to a multi-billion dollar company like Philip Morris. True. But ask yourself why the hell would Philip Morris fight this for 12 years and spend millions on legal fees? Because the tobacco industry is TERRIFIED of legal precedent. Philip Morris was essentially fighting the dollar amount. The tobacco company had already paid millions to the widow. The widow and the state of Oregon, prosecuting the case, reached an interesting settlement. If they won before the Oregon Supreme, the state would receive $55 million to go toward its crime victim’s fund (which makes sense, since what the tobacco companies do is a crime), while Ms. Williams would receive $45 million (somehow, that adds up to $99 million). Philip Morris had an interesting argument. The company contended that Oregon had already signed off on its right to the money because in 1998 – one year before the jury’s verdict – the state agreed not to pursue any more claims for injuries from tobacco exposure in the massive 1998 Master Settlement Agreement. The clause was part of a settlement brokered with Philip Morris, other tobacco companies and 46 states for the billions of dollars the states had paid and would continue to pay for health care for ailing, low-income smokers. Under that deal, the tobacco companies agreed to pay Oregon $2.1 billion during the first 25 years and then about $81 million a year in perpetuity. But attorneys for Oregon and Ms. Williams argued that state was simply trying to collect on the 60 percent due to it under the state’s punitive-damages law, separate from the 1998 MSA. The Supreme Court agreed. No word if Philip Morris will appeal, but I suspect it will.

$10 billion judgment against Phillip Morris revived!

A 2003 court case in Illinois awarded a $10 billion judgment against Phillip Morris for lying about the safety of its “low-tar” cigarettes. That decision got overturned by the Illinois Supreme Court in 2006, but now an appeals court has breathed life back into the case by ruling that a recent U.S. Supreme Court decision now changes the playing field legally.

It’s complicated, and I’m not sure I’m going to explain it 100 percent correctly, but here’s the gist of it. The Illinois Supreme Court had found that the descriptive terms for the cigarettes were permitted by the Federal Trade Commission and thus did not break state law. The U.S. Supreme Court refused to accept the plaintiffs’ appeal.

However, though in a 2008 decision regarding a lawsuit in Maine, the U.S. Supreme Court rejected an “identical” Philip Morris defense, so plaintiffs’ lawyers successfully argued that the Illinois case should be looked again in light of that ruling.