No Monetary Penalty For Big Tobacco

Judge Rules Industry Lied To Public But Stops Short Of Ordering Fines

(AP)  A federal judge ruled Thursday that the nation's top cigarette makers violated racketeering laws, deceiving the public for years about the health hazards of smoking, but said she couldn't order them to pay the billions of dollars the government had sought.

U.S. District Judge Gladys Kessler did order the companies to publish in newspapers and on their Web sites “corrective statements” on the adverse health effects and addictiveness of smoking and nicotine.

She also ordered tobacco companies to stop labeling cigarettes as “low tar,” “light,” “ultra light” or “mild,” since such cigarettes have been found to be no safer than others because of how people smoke them.

In her ruling in the long-running case, the judge said, “Over the course of more than 50 years, defendants lied, misrepresented and deceived the American public, including smokers and the young people they avidly sought as 'replacement smokers,' about the devastating health effects of smoking and environmental tobacco smoke (secondhand smoke).”

Kessler, who presided over the nonjury trial in the case, said that adoption of a national stop-smoking program, as sought by the government, “would unquestionably serve the public interest” but that she was barred by an appeals court ruling that said remedies must be forward-looking and not penalties for past actions.

The Justice Department called that disappointing, reports CBS News correspondent Wyatt Andrews. So did the Legacy Foundation — which was in line to spend any monetary damages for a public education campaign.

"I was surprised and disappointed on behalf of the American people because the judge rightly found massive liability — indeed racketeering — on the part of the tobacco industry," Legacy Foundation president and CEO Cheryl Healton told Andrews.

The government had asked the judge to make the companies pay $10 billion for smoking cessation programs, though the Justice Department's own expert said $130 billion was needed.

That reduction in recommended remedies led to accusations that Robert McCallum, an associate attorney general appointed by President Bush, had tried to weaken the case. An internal Justice Department investigation cleared him of wrongdoing, however, saying he was supporting a figure he thought could be sustained on appeal. McCallum is now U.S. ambassador to Australia.

Kessler's decision came nearly a decade after the states reached legal settlements with the industry worth $246 billion and aimed at recovering health care costs. Those settlements imposed some restrictions on the industry, such as banning ads on billboards and public transportation.

In the federal case, tobacco companies had denied committing fraud and had said changes in how cigarettes are sold now make it impossible for them to act fraudulently in the future.

In addition to saying she could not force the companies to pay for a quit-smoking program, Kessler rejected a government bid to impose fines on the industry if youth-smoking rates fail to drop in the coming years.

[starlady2]

Well, considering that tobaco VP's were telling asian contries that deaths from tobacco poisoning was a nice way of keeping insurance costs down, by way of population control, what does that say about the rationale of this ruling?

[witherite]

So where can I get my treatment...Of course, that is, if the lawyers and the government don't get all the money and siphon off the morjority of it...You can bet they will get their share first, and most of them probably aren't even smokers...Like the last federal lawsuit, the lawyers where the winners...Makes you wonder who the real "Racketeers" are.

[welch-mike1]

This whole tobacco industry lawsuit by the states and the government is just another big government scheme to deem individuals as not responsible for their own actions. Nobody has to smoke, nobody said you should smoke, so why should tobacco companies be any more liable than McDonalds for the fact that there are fat people. Get a life. This is just another political witch hunt so some idiot like Chertoff can run for political office. Its all POLITICS!

[fatherfinigi]

While we are at it, the psychiatric/psychololgical industry has been engaged in racketeering dealing in fraud getting all imagined, untested, uncertified as real "disorders" passed when the "physicians" if you can legally call them that, insist that there is no verifiable cure for their "mental diseases". Getting government monies for their fraudulent research is a crime.

[fatherfinigi]

Are not the members of the pharmaceutical industry racketeers as well. If you are going to accuse the tobacco industry of that then the "Big Pharma" certainly follows suit. Racketeering id defined as engaging in a scheme for getting money or other benefits by fraud, intimidation or other illegitimate means. Pharmaceutical companies are certainly engaging in that!