Court sense
BIG TOBACCO MAY NOT BE the most sympathetic defendant. Still, Philip Morris’ victory in Illinois’ Supreme Court on Thursday is worth celebrating. The court dismissed a bogus $10-billion class-action suit that threatened not only the future of parent company Altria but, more important, America’s values of due process.
When companies engage in fraudulent activity, they should have to pay for it, and sometimes the price they must pay will put them out of business. But in this suit, brought in the state’s notoriously plaintiff-friendly Madison County, it was absurd for the trial judge to rule in the first place that Philip Morris had committed consumer fraud.
At issue was whether more than a million buyers of Marlboro Lights or Cambridge Lights had been defrauded by claims that the cigarettes contained lower levels of tar and nicotine. (A consumer fraud case is easier to certify as a large class-action suit than a case involving individual health claims.) In its 4-2 decision, the court ruled that such fraud couldn’t possibly have occurred, given the amount of federal regulation of the marketing of such “light” cigarettes.
The Federal Trade Commission first allowed companies to use such labels as “low tar” and “light” decades ago, and at the time it established the criteria to merit such a designation. It undermines the entire purpose of federal regulation for a court to find a company that has complied with such regulations liable for fraud by retroactively setting a different standard of behavior.
“We conclude that the FTC could, and did, specifically authorize all United States tobacco companies to utilize the words ‘low,’ ‘lower,’ ‘reduced’ or like qualifying terms, such as ‘light,’ so long as the descriptive terms are accompanied by a clear and conspicuous disclosure of the tar and nicotine content in milligrams,” the court ruled.
The other farcical element in this case was how the plaintiffs, after filing a consumer fraud case seeking economic damages, tried to make it a case about health. Light cigarettes are less healthy than regular cigarettes, the plaintiffs argued, because they induce people to smoke more in order to compensate. That’s like saying low-fat ice cream is more fattening because people eat more of it.
Such nonsensical litigation has to stop. The civil justice system is an important adjunct to the regulatory state -- another means of protecting consumers from corporate wrongdoing. But such shakedown cases against tobacco companies, which not only lack merit but also seek to supplant the government’s regulatory powers, breed cynicism about the entire tort system and tarnish worthy class-action suits.
That’s why Thursday’s decision by the Illinois high court isn’t just a big win for Big Tobacco -- it’s an important victory for the rule of law.
