Cigarette Execs Get Cool Reception at House Hearing

Hoping to ensure the future of their business, the heads of the five biggest tobacco companies went before Congress on Thursday to try to persuade lawmakers that they have turned over a new leaf and will aid the fight against youth smoking if Congress ratifies the $368.5-billion tobacco truce.

Although the executives were models of contrition and humility--going further than ever before in admitting that smoking is dangerous and addictive--they got a mostly frosty reception from the House Commerce Committee, an additional sign that the landmark tobacco deal is in deep trouble.

“In hindsight, I wish years ago I had the foresight to find common ground with our critics,” said Geoffrey C. Bible, chairman of industry leader Philip Morris, who appeared with chief executives for RJR Nabisco, Brown & Williamson, Loews and U.S. Tobacco.

The executives made a peace offering, announcing that they would make public the 30 million pages of internal documents provided to attorneys for Minnesota in the state’s anti-tobacco case being tried in St. Paul.

But committee members seemed to find little to like in the tobacco deal, which would protect tobacco companies from the most threatening lawsuits in return for curbs on tobacco advertising and huge industry payments to reimburse tobacco-related health-care costs and pay for anti-smoking programs.

Several members thought the deal was too soft on the industry, others found it too tough. But not one of the 30 committee members who spoke was willing to endorse it publicly.

“These CEOs may be messiahs to shareholders and market analysts, but I don’t think they’ve won any converts on this committee,” said Mary Aronson, a Washington-based legal and financial advisor.

She noted that Congress has not adopted proposals to limit liability for manufacturers generally, including respected consumer product makers. “If they didn’t do it for the good guys, why would they do it for this industry--the one industry that everybody loves to hate?”

Reflecting the charged atmosphere of the hearing and the certainty of wide publicity, sources told The Times that tobacco executives had appealed to committee Chairman Tom Bliley (R-Va.) to forgo the procedure of swearing them in en masse.

Because of the criminal probe that followed, the picture of former tobacco chiefs with hands raised as they were being sworn in together at a 1994 hearing before a commerce subcommittee has become one of the enduring images of the smoking wars. With that in mind, the current crop of CEOs--all new since 1994--unsuccessfully pleaded to avoid a repeat.

“They would rather have appeared naked,” said an anti-tobacco lawyer who attended the hearing.

Bliley refused to swear them in individually. “The chairman’s response was we have standard procedures,” a congressional source said. “The committee is not going to monkey around with those sorts of things.”

It was at the 1994 hearings that industry leaders testified under oath that they did not consider nicotine to be addictive. Within days, documents leaked to Congress and the media from Brown & Williamson appeared to contradict their testimony.

The result was a Justice Department probe of perjury allegations, which has evolved into a wider investigation into whether the industry has defrauded consumers and public agencies.

But Bliley, who represents Richmond, Va., where Philip Morris is the largest private employer, continued to distance himself from the industry, which has given more in campaign contributions to him than any other member of Congress.

He told the CEOs that recent disclosure of R.J. Reynolds’ documents describing efforts to market to teens “have shaken my confidence that your companies care about the truth.”

“Four years ago, I was willing to give your companies the benefit of the doubt,” he said. “Today the burden is on you.”

As they seem to be at every turn, tobacco officials again were ambushed by new documents showing past efforts to sell to underage smokers. Rep. Sherrod Brown (D-Ohio) cited a memo from Lorillard, the tobacco subsidiary of Loews, on the popularity of its flagship Newport brand.

“The success of Newport has been fantastic during the past few years,” according to the memo, which had been cited earlier in the week in the Minnesota court case. “The base of our business is the high school student.”

Brown and Reps. Henry A. Waxman (D-Los Angeles) and John D. Dingell (D-Mich.) introduced a Philip Morris memo from 1975 that raised concern about the declining rate of sales growth among Marlboro smokers ages 15 to 19.

Questioned about a 20-year-old R.J. Reynolds memo about the need to “establish a successful new brand” in the 14-to-18-year-old market, Steven F. Goldstone, chief executive of RJR Nabisco, said he was troubled “as a chief executive and . . . as a father.”

“I don’t know what the rules of the game were” then, but it’s “unacceptable today,” he said. There is no one now who “would dare even think to do anything like that.”

In a pitch for the settlement, Goldstone stressed the need for better relations between the industry and its adversaries. Makers of a hazardous product “need to cooperate with public health authorities,” which he said is impossible when tobacco officials spend most of their time conferring with the lawyers defending them in court.

Four of the five CEOs said they believe smoking can be called addictive. “We recognize that nicotine as found in cigarette smoke under some definitions . . . is addictive,” said Bible of Philip Morris.

Industry strategists are already conceding the possibility that the settlement will go down in flames, according to a memo introduced at the hearing. In the December memo, an industry public relations firm urged a massive advertising blitz, both to rally support for the deal and to serve as a possible “exit” strategy.

If the settlement dies, the industry will be able to show that it “made a legitimate offer and the politicians played politics and made a mess of it.”

Several committee members criticized the Clinton administration for failing to send a detailed proposal on implementing the deal. If administration officials want comprehensive tobacco legislation as they say, “they have to get in the game,” complained Rep. John Shimkus (R-Ill).

“If we thought sending up our own bill would increase the likelihood of a deal, we would do so,” said Elena Kagan, deputy director of Clinton’s Domestic Policy Council. “We don’t think that right now; it’s possible down the road that our calculation would change.”

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Times staff writer Henry Weinstein contributed to this report from St. Paul, Minn.