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Tobacco Lawyers Deny Health Conspiracy

From Reuters

Tobacco industry lawyers on Tuesday denied any conspiracy to suppress the truth about smoking and health and accused Washington state of being its willing “financial partner” in the sale of cigarettes.

“The state was very aware of the health risks of cigarettes,” R.J. Reynolds Tobacco Co. lawyer Bradley Keller said, outlining the industry’s response to the state’s landmark lawsuit. “The state has to accept responsibility for its choices.”

Reynolds, a unit of RJR Nabisco Holdings Corp., is among the principal defendants in a lawsuit charging the industry with violating state antitrust and consumer protection laws over the last 45 years and costing the state at least $1.4 billion in excess Medicaid expenses.

Tobacco industry lawyers, making their first courtroom statements in a trial expected to last up to five months, acknowledged that smoking presents the risk of lung cancer and other diseases and that nicotine is addictive as the term is commonly used.

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But they said the state was never misled about the dangers of smoking, suffered no financial harm from the industry’s behavior, and in fact took in $4.1 billion in tobacco-related taxes from 1955 to 1997.

“To say as the state does here that we were in a conspiracy to hide the health effects of our products just will not square with the evidence in this case,” said Steven McCormick, a lawyer for Brown & Williamson Tobacco Corp., a unit of BAT Industries.

The case, being heard in Seattle’s King County Superior Court, is the second of 40 state lawsuits brought against the industry to come to trial.

Atty. Gen. Christine Gregoire, who sat at the plaintiff’s table for the first two days of the trial, said she would fly to New York late Tuesday to resume multi-state negotiations with defendants Philip Morris Cos.; Lorillard Tobacco Co., a unit of Loews Corp.; and the now-defunct United States Tobacco Co.

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She said she is optimistic a settlement will be reached but that the trial will continue, especially since RJR Nabisco and Brown & Williamson have withdrawn from the talks.

In addition to the tax revenue, Keller said, the state made “hundreds of millions of dollars” more through its pension fund holdings in tobacco stocks. He made the startling disclosure that Washington state was the single biggest shareholder in RJR Nabisco as recently as the early 1990s.

And he said the tobacco companies would introduce evidence of complex state computer models designed to determine how much cigarette taxes could be raised without causing “too many people to stop smoking” and thus reduce state revenue.


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