Cigarette Firms Win Dismissal of Lawsuits
A federal appeals court Tuesday threw out racketeering claims against Philip Morris Cos. and other U.S. cigarette makers by labor unions and dismissed separate claims against the industry by three foreign nations.
Tobacco analysts said the ruling may cast doubt on a U.S. government suit against the tobacco companies and bolsters their prospects in other legal battles.
Separately, leading trial attorneys Johnnie Cochran and Michael Hausfeld said they will file a racketeering lawsuit today against U.S. cigarette makers, alleging they illegally targeted children with advertising and marketing.
The suit, to be filed in federal court in Washington, will seek class-action status on behalf of young smokers nationwide, they said.
In addition to its dismissal of the racketeering case Tuesday, the U.S. Court of Appeals for the District of Columbia threw out claims by Guatemala, Nicaragua and Ukraine seeking to recover government funds expended on sick smokers.
The union trust funds, including the Service Employees International Union Health and Welfare Fund, had been allowed to proceed with their federal racketeering case by U.S. District Judge Gladys Kessler, who ruled in the plaintiffs’ favor in December 1999.
The appeals court reversed that decision, reasoning that any alleged injuries were suffered by union members and not the health-care funds that brought the complaints. “We agree with the other circuits that the alleged injuries of the third-party payers are too remote to have been proximately caused by the defendants’ alleged conduct,” the court wrote in its decision.
Kessler, who is presiding over the Justice Department’s lawsuit against the tobacco industry, also allowed that case to go forward on racketeering claims.
On the New York Stock Exchange, Philip Morris shares fell 38 cents to close at $49.39; R.J. Reynolds fell 78 cents to $58.12; Loews fell 80 cents to $70.35; and Vector fell 16 cents to $34.60. British American Tobacco’s American depositary receipts fell 26 cents to close at $15.41 on the American Stock Exchange.
