State Likely to Join Tobacco Suit Today

Atty. Gen. Dan Lungren is expected to follow 36 other states today by suing the tobacco industry to recoup hundreds of millions of dollars in California’s tobacco-related medical costs.

Lungren’s announcement is expected to come today as Gov. Pete Wilson signs a bill that specifically grants the attorney general the authority to sue cigarette manufacturers.

“We have requested that the attorney general immediately file a lawsuit for the costs of health care services for those who have suffered from tobacco-related illness,” said Sean Walsh, Wilson’s spokesman.

In a meeting with Times editors and reporters Wednesday, Lungren would only hint that he was preparing to sue.

“We’ve been examining a whole bunch of areas based on the thousands of documents available,” Lungren said.

Other state officials, familiar with the action, however, confirmed that the suit is expected to be filed today and would closely track suits filed by the other states.

In addition to the claim for reimbursement of money that the state has spent on health care for poor Californians with smoking-related illnesses, the suit is expected to include claims for violations of state antitrust laws for failing to develop a safer cigarette. Other allegations will include false advertising and fraud for concealing information about the addictive nature of nicotine and for targeting children.

Democrats in California have been clamoring for Lungren to bring the suit since Mississippi became the first state to sue the tobacco industry in 1994 to recover costs associated with tobacco-related illnesses.

Lungren, a Republican who plans to run for governor next year, said last year that he opposed the litigation, saying that the question of tobacco regulation was better left to Congress. But he also said that a 1987 state law exempting tobacco from some types of the lawsuits precluded him from bringing a broad suit to recover the health care costs.

Once it became apparent that Lungren would not sue without the legislation, the Democratic-controlled Legislature led by Speaker Cruz Bustamante (D-Fresno) approved the bill granting the state authority to sue, and sent it to Wilson for his signature.

“The only thing I can say is this: I have asked the Legislature for more than a year to take care of the obstacles,” Lungren said. “This [new law] gives us an ability to assess the matter without that impediment.”

Lungren repeated his hope for a so-called global settlement of the tobacco litigation that would resolve not only past health care costs, but also future tobacco litigation questions. If no settlement is forthcoming, however, he sought to dampen expectations about the success of such suits.

Citing a recent court ruling in Washington state that Washington had no recoverable damages, Lungren said: “I hope people are disabused of the notion that these are slam-dunk cases.”

Lungren’s suit means that California will gain some standing as other states’ attorneys general, who filed their suits a year or more ago, continue to negotiate a possible settlement with tobacco companies--although Wednesday, representatives of the nation’s two largest tobacco companies vowed to fight the suit in court.

Lungren’s suit will be “yet another attempt to rewrite the law of tort liability,” said Maurice Leiter, a Los Angeles attorney in the firm Arnold and Porter, which represents Philip Morris, the nation’s No. 1 tobacco firm. “Assuming it takes the same tack [as suits by other states], we assume it will be unsuccessful.”

States are enticed by the potential sums at stake. The nationwide tobacco litigation settlement under discussion has been rumored to be anywhere from $250 billion to $400 billion, paid out over as many as 30 years.

California’s share of any such fund remains to be determined. However, California state health officials estimate that the state Medi-Cal cost of caring for people with tobacco-related illnesses is $400 million a year in state and federal money, said Lynda Frost, spokeswoman for the state health department.

Depending on the claims included in Lungren’s lawsuit, California could seek Medi-Cal costs going back several years--thereby pushing the total into the billions.

In Texas, the settlement could reach as much as $14 billion, said Ron Dusek, spokesman for Texas Atty. Gen. Dan Morales. Dusek said that because California is among the last states to enter the fray, it could end up receiving less than states that were among the first to sue.

“You get into the game earlier, and [your lawyers] have more time accumulated, more hours clocked,” Dusek said. “Compensation will be greater than for those who show up just as the pie is being cut, and weren’t there for the baking.”

Dusek said that although California’s entry could add pressure on the tobacco industry to settle, “the impact will be less than had California entered earlier when we could have used increased pressure to get the tobacco industry to the bargaining table.”

Lungren’s anticipated lawsuit was hailed by other government attorneys involved in the litigation.

Massachusetts Atty. Gen. Scott Harshbarger, president of the National Assn. of Attorneys General, issued a statement saying that “by filing suit, Atty. Gen. Lungren will bring considerable clout to this important initiative, both in court and at the bargaining table.”

In California, Democrats were waiting to be persuaded that Lungren would be aggressive.

“He has dillydallied for so long that the possibility of him playing any significant role in these settlement talks is virtually nil,” said Garry South, chief of staff to Lt. Gov. Gray Davis, a likely Democratic candidate for governor.

State Sen. Diane Watson (D-Los Angeles) won passage Wednesday in the Senate Health Committee of a resolution calling on Lungren to limit any settlement to state costs, and not agree to language that might restrict the U.S. Food and Drug Administration from regulating tobacco, or limiting future lawsuits.

“Quite frankly, this [lawsuit] should have happened a long time ago,” said Assemblyman Martin Gallegos (D-Baldwin Park), the lower house’s health committee chairman. “Now, we need to ensure that the lawsuit has teeth and he backs it up and that it not be a hollow gesture.”

Times political writer Cathleen Decker contributed to this story.

* TOBACCO TALKS: Money will be a key issue when tobacco suit talks resume. D1