If Minnesota wins its case against the tobacco industry, the cigarette manufacturers could be forced to turn over the profits they made in the state, a federal judge ruled.
On the eve of opening statements in Minnesota's tobacco trial, Ramsey County District Judge Kenneth Fitzpatrick on Sunday denied cigarette makers' request to bar the state from seeking their profits if they are found to have committed fraud.
State law allows Minnesota to recover profits made from illegal activities. How much profit tobacco companies make is one of the industry's most guarded secrets.
Attorneys were scheduled to begin opening statements today.
They will try to convince the jury that the tobacco industry should compensate the state and Blue Cross and Blue Shield of Minnesota for the costs of treating smoking-related illnesses. Those costs have been estimated at $1.75 billion, and the plaintiffs also seek punitive damages.
The state and Blue Cross claim tobacco companies committed fraud by suppressing information on the dangers of smoking while publicly denying that tobacco was a health hazard.
In another ruling Sunday, Fitzpatrick said tobacco lawyers can argue that Blue Cross could have offset the costs of treating smoking-related medical problems by charging smokers a higher premium for health insurance. He also said defense attorneys can point to the state's collection of cigarette taxes to show that the state has profited from the sale of tobacco.
However, the judge said he will not let tobacco lawyers argue that cigarette taxes should be used to offset any final judgment if the tobacco companies lose.
Minnesota's would be the first of 40 state lawsuits against the cigarette makers to make it as far as opening statements. Texas, Florida and Mississippi settled their cases. Only Florida's got as far as jury selection.
Tobacco lawyers have asked Fitzpatrick to throw out the pool of 24 candidates from which the final jurors were selected and start over. They claimed he made legal mistakes and unfair decisions during the selection process, which they said resulted in a pool biased against the industry.
Fitzpatrick had not ruled on that motion, and it was not clear whether he needed to decide before opening statements began.
Several of the pool members expressed anti-tobacco sentiments during questioning, and nine of the final 12 jurors said smoking is addictive.
The defendants include Philip Morris Inc.; R.J. Reynolds Tobacco Co.; Brown & Williamson Tobacco Corp.; Lorillard Tobacco Co.; the Tobacco Institute; and Liggett Group Inc., which is a defendant of Blue Cross only. Liggett reached a separate settlement with the states last year.