This case is important. Tobacco companies have been completely successful fending off lawsuits for three decades. Very recently, however, victories both in and out of court have uncovered mountains of internal tobacco documents. This finally provides the evidence the Department of Justice needs to prosecute the tobacco industry. Their goal: to punish the industry for decades of fraud. They cannot seek money for past medical damages, but will try to prove fraud and show that the industry has been in violation of RICO, the Racketeer Influenced and Corrupt Organizations Act.

After six years of pre-trial motions and discovery, DOJ prosecutor Sharon Eubanks heads a team of government attorneys in their litigation against American Tobacco, British American Tobacco, Brown & Williamson, Liggett, Lorillard, Philip Morris, and R.J. Reynolds.

photo credit : ajari

The case is the biggest civil case ever prosecuted by the DOJ, but several obstacles stand in the way of a government win:

1. Sharon Eubanks’ superiors tell her to take it easy on tobacco. She resigns. ¹

2. The US Court of Appeals rules that disgorgement is not permissible under RICO; the government cannot claim money for 1971-2001 sales, only to prevent future damage. There will be no monetary punishment.

In order to prevent future racketeering, presiding judge Gladys Kessler renders judgement forcing the tobacco companies to issue corrective statements explaining tobacco’s health effects. The companies are forbidden to make misleading statements about tobacco, and can no longer use “light”, “low-tar”, “natural”, or other misleading descriptors. They are told to maintain databases of documents unearthed through the trial².

However, like many judgements against tobacco companies, Judge Kessler’s remedy is being debated in the US Court of Appeals. We will watch eagerly to see whether these public health measures will survive.

The monumental, in size and in impact, seventeen hundred page opinion from Judge Kessler³ provides us with a catalogue of methods used by tobacco companies. These have been laid out in the findings of fact section of the opinion.

These facts, found through the adversarial process of trial and stated by a United States federal judge, represent a foundation of truth about the tobacco industry, and provides a launching pad for further action - legal or political - against tobacco. This is becoming ever more crucial as multinational tobacco companies, many of American origin, push nicotine addiction into every country around the world. These 4088 facts compiled together provide us with a clear image:

the tobacco industry

• was aware yet denied tobacco’s addictive/harmful effects on the public
• targeted young people
• denied the effects of second hand smoking
• used misleading descriptors like “low-tar”/”filtered”/”lite”
• suppressed scientific research from public
• designed methods to keep people addicted

These quotes have been pulled from a very helpful summary by the Tobacco Control Legal Consortium⁴.

Findings of Fact | United States v. Philip Morris

509 <- Findings of Fact #
Cigarette smoking causes disease, suffering, and death.

864
By 1988, almost every major public health organization, including the Surgeon General, the National Institute on Drug Abuse, the World Health Organization, the American Psychiatric Association, the Harvard School of Public Health, and others, had declared that smoking is an addiction driven by the drug nicotine… .

The Tobacco Industry Was Aware yet Denied Tobacco’s Addictive/Harmful Effects on the Public

824
From at least 1953 until at least 2000, each and every one of these Defendants repeatedly, consistently, vigorously — and falsely — denied the existence of any adverse health effects from smoking.

829
Since the 1950s, Defendants have researched and recognized, decades before the scientific community did, that nicotine is an addictive drug, that cigarette manufacturers are in the drug business, and that cigarettes are drug delivery devices.

1359
For approximately forty years, Defendants publicly, vehemently, and repeatedly denied the addictiveness of smoking and nicotine’s central role in smoking.

photo credit : HAMED MASOUMI

1360
[T]here is no question that the public health community lacked the substantial and sophisticated understanding of nicotine’s effects and role that Defendants possessed.

736
During [a] televised interview, [Philip Morris President Joseph] Cullman falsely denied that cigarettes posed a hazard to pregnant women or their infants: “[I]t’s true that babies born from women who smoke are smaller, but they are just as healthy as the babies born to women who do not smoke. Some women would prefer to have smaller babies.”

697
In 1974…British American Tobacco (Investments) Ltd. (BATCo)…was considering placing a warning on cigarette packages sold in England — with no government attribution — that stated that smoking “causes lung cancer, bronchitis, heart disease.” In a letter addressed to BATCo, David Hardy of [the law firm of] Shook, Hardy & Bacon advised that this admission of fact would impede the defense of smoking and health litigation in the United States.

photo credit : colros

974
[Scientist Claude] Teague wrote a memorandum dated December 1, 1982 to Research and Development Vice President Robert DiMarco in which he stated that… [R.J. Reynolds] needed to contemplate the future scenario where smokers who want to stop can stop; if this happened, he wrote, RJR would “go out of business.” Therefore, RJR “cannot be comfortable marketing a product which most of our consumers would do without if they could.”

1269
A September 9, 1980 Tobacco Institute internal memorandum revealed the recognition by the member companies that a public admission that nicotine was addictive would undermine their litigation defense that a person’s decision to smoke is a “free choice” … .

994
[In a February 13, 1962 memorandum, Sir Charles Ellis, scientific director to the BAT Board of Directors, stated: “]As a result of these various researches we now possess a knowledge of the effects of nicotine far more extensive than exists in published scientific literature.[”]

The Industry Targeted Young People

3296
The evidence is clear and convincing — and beyond any reasonable doubt – that Defendants have marketed to young people twenty-one and under while consistently, publicly, and falsely, denying they do so.

3301
Defendants spent billions of dollars every year on their marketing activities in order to encourage young people to try and then continue purchasing their cigarette products in order to provide the replacement smokers they need to survive.

2637
As Bennett LeBow, President of Vector Holdings Group, stated, “If the tobacco companies really stopped marketing to children, the tobacco companies would be out of business in 25 to 30 years because they will not have enough customers to stay in business.”

photo credit : HAMED MASOUMI

2789
Ted Achey, Lorillard’s Director of Sales in the Midwest…demonstrates that Lorillard recognized the significance of the underage market to the company: The … base of our business is the high school student.

3264
Steven C. Watson, Lorillard Vice President, External Affairs, was responsible for issuing a press release in 2001, stating “Lorillard Tobacco Company has never marketed or sold its products to youth.”

photo credit : helgasms!

Second Hand Smoking

3303
During the 1970s, scientific evidence suggesting that exposure to cigarette smoke was hazardous to nonsmokers began to grow, and public health authorities began to warn of a potential health risk to both adults and children.

3304
A 1986 [British American Tobacco (Investments) Ltd. (BATCo)] document stated: “The world tobacco industry sees the ETS issue as the most serious threat to our whole business.”

3305
… currently no Defendant publicly admits that passive exposure to cigarette smoke causes disease or other adverse health effects.

3362
Defendants recognized that secondhand smoke contained high concentrations of carcinogens and other harmful agents.
… research funded by Defendants themselves provided evidence confirming the public health authorities’ warnings that nonsmokers exposure to cigarette smoke was a health hazard.

photo credit : kalandrakas

3861
Despite the fact that Defendants’ own scientists were increasingly persuaded of the strength of the research showing the dangers of ETS to nonsmokers, Defendants mounted a comprehensive, coordinated, international effort to undermine and discredit this research.
Philip Morris Companies Vice Chairman Bill Murray was advised … in 1987: “…ETS is the link between smokers and non-smokers and is, thus, the anti’s [anti-smoking activists] silver bullet.”

Tobacco Companies Deceive Using Terms Like “Low-Tar”/”Filtered”/”Lite”

2072
Because each smoker smokes to obtain his or her own particular nicotine quota, smokers end up inhaling essentially the same amount of nicotine — and tar — from so-called “low tar and nicotine” cigarettes as they would inhale from regular, “full flavor” cigarettes… . Virtually all smokers, over 95%, compensate for nicotine.

2163
A February 4, 1976 memorandum from Ernest Pepples, [Brown & Williamson (B&W)] Senior Vice President … reveals Defendants’ knowledge that the low tar and filter cigarettes they were marketing as less harmful were not producing less tar and less nicotine to the smoker and were not likely to actually be less harmful … .

2627
It is clear, based on their internal research documents, reports, memoranda, and letters, that defendants have known for decades that there is no clear health benefit from smoking low tar/low nicotine cigarettes as opposed to conventional full-flavor cigarettes.

photo credit : jesse.millan

Methods Tobacco Companies Utilize to Deny or Suppress Scientific Research from Public

3861[cont]
Defendants poured money and resources into establishing a network of interlocking organizations. They identified, trained, and subsidized “friendly” scientists through their Global Consultancy Program, and sponsored symposia all over the world from Vienna to Tokyo to Bermuda to Canada featuring those “friendly” scientists, without revealing their substantial financial ties to Defendants.
They conducted a mammoth national and international public relations campaign to criticize and trivialize scientific reports demonstrating the health hazards of ETS to nonsmokers and smokers.

3863
Defendants attempted to and, at times, did prevent/stop ongoing research, hide existing research, and destroy sensitive documents in order to protect their public positions on smoking and health, avoid or limit liability for smoking and health related claims in litigation, and prevent regulatory limitations on the cigarette industry.

4034
The foregoing Findings of Fact demonstrate that, over the course of approximately fifty years, different Defendants, at different times, took the following actions in order to maintain their public positions on smoking and disease-related issues, nicotine addiction, nicotine manipulation, and low tar cigarettes, in order to protect themselves from smoking and health related claims in litigation, and in order to avoid regulation which they viewed as harmful: they suppressed, concealed, and terminated scientific research; they destroyed documents including scientific reports and studies; and they repeatedly and intentionally improperly asserted the attorney-client and work product privileges over many thousands of documents (not just pages) to thwart disclosure to plaintiffs in smoking and health related litigation and to federal regulatory agencies, and to shield those documents from the harsh light of day.

677
In 1970, Philip Morris’s President complained to RJR about the work going on in the Mouse House. Despite the progress made there, RJR responded to the complaint by abruptly losing the Mouse House — disbanding the entire research division in one day, without giving notice to the staff, firing all twenty-six scientists at the Mouse House, and destroying years of smoking and health research.

photo credit : Valentin.Ottone

1303
None of the results or conclusions from the Philip Morris Nicotine Program or Behavioral Research Program were made public or were included in Philip Morris’s and the industry’s collective submission to the FDA in 1996.

4020
During the 1990s, Liggett scientists were directed to label their work as privileged and confidential in order to prevent its discovery in civil litigation. As stated by Liggett’s Manager of Science Issues, “We had become sensitized to labeling a lot of documents privileged and confidence [sic] without thinking[,] it was kind of just a matter of fact thing to do… . [M]ost of the documents that we put out, I think, are always subject to discovery. And not knowing exactly where — where this was gonna go, it was just considered almost standard practice to do that.”

photo credit : Jen SFO-BCN

The Industry Designed Methods to Keep People Addicted

1366
Defendants have designed their cigarettes to precisely control nicotine delivery levels and provide doses of nicotine sufficient to create and sustain addiction. At the same time, Defendants have concealed much of their nicotine-related research, and have continuously and vigorously denied their efforts to control nicotine levels and delivery.

636
Defendants recognized — and used — the denial and rationalization used by smokers. In a memo to Joseph F. Cullman of Philip Morris, George Weissman, Executive Vice President Overseas (International), described how, in response to the 1964 Surgeon General’s Report, “we must in the near future provide some answers which will give smokers a psychological crutch and a self-rationale to continue smoking.”
Among the “crutches” and “rationales” proposed to be offered to the smokers were questions of medical causation, “that more research is needed,” and that there are “contradictions” and “discrepancies.”

photo credit : euzesio

It’s helpful to look at the history of tobacco litigation in three waves:

The first two waves are characterized by a highly successful scorched earth trial strategy, described by R. J. Reynolds’ attorney J. Michael Jordan:

“[T]he aggressive posture we have taken regarding depositions and discovery in general continues to make these cases extremely burdensome and expensive for plaintiffs’ lawyers, particularly sole practitioners. To paraphrase General Patton, the way we won these cases was not by spending all of [R.J. Reynolds’] money, but by making that other son of a bitch spend all of his.”

This exhaustion of plaintiff funds made it extremely hard to continue cases against the industry. Inside the courtroom, however, tobacco industry attorneys have framed the defense in different ways. In the first two “waves” of tobacco litigation, the industry shifted its tactics to deal with new research. In the third wave, it was the plaintiff’s turn to change strategies.

The First Wave 1954–1973: Individuals with lung cancer and their families seek money for the expense and suffering caused by tobacco products. The tobacco manufacturers deny that smoking directly causes lung cancer, citing scientific controversy. This also relieves them of the duty to warn customers of any connection between smoking and disease.

The Second Wave 1983–1992: Manufacturers now claim that tobacco’s health risks are common knowledge, and smokers should not have relied on manufacturer denials. This “assumption of risk” takes the liability off of manufacturers, and puts it squarely on smokers.

In 1992, Cipollone v. Liggett Group, Inc provides the first sign of anti-tobacco victory. Tobacco spends $50-70 million to counter the plaintiff’s $3 million. Ultimately, no money goes to the long deceased Rose Cipollone. However, the case is successful in releasing a small number of industry documents which will hint at potential avenues for success.

The Third Wave 1994-Present: Litigators build on the documentary evidence from prior cases, and focus on the conduct of tobacco manufacturers rather than the effects of tobacco smoking.

The development of contingency fees and class action claims make it possible to overcome tobacco’s scorched earth strategies.

The assumption of risk argument begins to be undermined. Evidence surfaces through unearthed industry documents that tobacco companies are aware of and even enhance the addictiveness of tobacco. Because tobacco companies target youth, this makes the industry at least in part responsible for health complications.

Combined, these new factors in the third wave introduce a new possibility for tobacco litigation plaintiffs: success.

While there were no plaintiff victories in the first and second wave, plaintiffs manage to win 37% of trial cases against Philip Morris from 1995-2005. Though Philip Morris pays out $102 million during this period, many plaintiff victories remain on appeal, and tobacco companies are certainly not slacking. Philip Morris and RJ Reynolds spend a combined half billion dollars a year on litigation between 2000 and 2004. Conducting litigation against such towering legal resources is daunting; fortunately, the evidence unearthed via tobacco litigation will make it easier for future plaintiffs to win.

Below is a chart summarizing the strategies that have been used by tobacco industry lawyers in personal injury cases where the plaintiff alleged that smoking caused their lung cancer. The most common arguments use “scientific denial” and the “plaintiff’s free will”, but used more than one defense in 85% of these cases.

Modified from Milberger, et al.¹

But careful! Situated directly across to the Borders is a Marshalls and 90 degrees to Borders and Marshalls is Target, all which require the distance of 20 feet between the smoker and the three stores. As the smoker huddles outside in the winter cold, puffing away in his one allotted square foot, the patrons in Borders stare out at him through frosty big windows as if he’s some rare zoo specimen in its natural (and small) habitat.

California is not a friendly place to smokers.

The same setting transported to Shanghai, China would render a different image. The ostracized man looking sadly at the warm laughing people inside will have no cigarette because in China, the oddball is the non-smoker concerned with inhaling.

This man is probably an American.

Nothing exposes the American in foreign lands more than when one starts warning others of the dangers of smoking. Actually, there is — when one starts warning about second-hand smoking.

It’s hard to understand the kind of anti-smoking culture that exists in California if you don’t grow up in California. For the majority of the world, attitude toward smoking is more akin to the one in Shanghai than in San Francisco and the fervent anti-smoking vibe of California is met, more or less, with eye rolls. After all, everyone smokes.

And in the coming decades, that statement is about to become truer. Tobacco use is rising fast and strong and that now ubiquitous slim, white cylinder will soon be hanging from more eager mouths than ever before. The “everybody does it” mentality can create a false sense of comfort, so it may surprise people to know that tobacco has silently become the single deadliest, yet preventable, killer in the world.

photo credit : the half-blood prince

We went over the World Health Organization’s Report On The Global Tobacco Epidemic, 2008 ¹. The report was released as part of the MPOWER package, and is a very comprehensive overview of the status of global tobacco use and prevention methods. We’ve pulled out some of the most relevant information and reproduced the graphs for you. Enjoy our comprehensive overview of their comprehensive overview.

SOMATIC

Did you know…

PECUNIARY

COURSE

Methods

Tobacco control is not expensive. Tobacco taxes increase government revenues and enforcement of smoke-free laws and advertising, promotion and sponsorship bans do not require large expenditure.

photo credit : julianrod

But hark, we don’t just blindly implement every single cost-beneficial program. We need also to consider the opportunity cost. In a world of limited resources, we may have to evaluate several programs based on cost-effectiveness, because every dollar we spend on program is an opportunity lost for another program. If spending $1 million on tobacco control in Sub-Saharan Africa will save 6000 DALYs, but that same $1 million on DDT spraying can prevent 110,000 DALYs lost to malaria², we may have to set aside tobacco control (DALYs = disability adjusted life years).

When we look through the lens of cost-effectiveness, however, we see that the dichotomy between prevention and treatment begin to break down. Generally, it is much more cost-effective to prevent disease than to treat it, but we may find that some treatment programs are actually more cost-effective than prevention. For rare (e.g., smallpox) or cheaply treatable (e.g., helminths) diseases, it can be cheaper to tackle cases as they come.

Discounted Future Returns
The problem of cost-efficacy analysis is made even harder when we have to account for both short term and long term gains. The California Tobacco Control program I mentioned saved many lives, but over the course of decades. Most people will not benefit from the efforts of the program until far in the future, making the results of the program more long-tail benefits.

photo credit : sanjoyg

Compare this to Oral Rehydration Therapy, which has saved the lives of 2.8 million children under 5 in the two decades from 1980-2000. Indeed, the thrill of saving lives immediately is invigorating. It’s easy to discount the 1 billion lives that might be lost to tobacco this coming century. And indeed, this is what happens: we tend to value current health more than future health. This not only colors the way we approach humanitarian issues, but can skew our opinions toward treatment over prevention.

Ethical Issues
Let’s go back to the Tobacco vs. Oral Rehydration Therapy situation. If you’re like me, you probably felt inclined to favor the ORT. The reason seems pretty simple: young children with limitless futures fulfill our humanitarian desires in ways old, coughing lung cancer patients don’t (not to mention that we can’t fault infants for being orally dehydrated). This is called the “fair innings” issue: when a younger person dies, they are robbed of their fair and full innings, while when an older person dies, we accept it³.

There are multiple more issues that need to be addressed. Equality is one; some treatments or prevention programs might dramatically increase the total quantity of health while other programs might only make moderate health gains, but distribute those gains more equally. Just as when dealing with money, we have to strike a balance between pure efficiency and equality. On top of that, do we prioritize certain members of society? Is a treatment that targets child-rearing mothers a higher priority than one that targets childless adults?

Maybe instead of thinking simply in terms of years lost, or even disability-adjusted-years lost, we ought to adjust for ethicalness as well. For example, if we look not at childhood immunizations costing $16/DALY averted, but rather as $8/Ethical-DALY averted, that could completely change the way we prioritize our funding.

A Hypothetical

Senator, you have some tough choices today. Not only do you have to decided whether to skip the fundraiser dinner for the golf tournament, you have to make a difficult decision about the health of your constituents. You invite your health advisors in for a consultation…

photo credit : gurms

Armpox causes complete arm failure at around 40. There is a vaccine available, which costs $50 to produce and administer, but not everyone would have ended up getting the disease regardless. For those that would have, however, the vaccine would allow them to have on average another 30 years of fruitful life. Nevertheless, scientists have worked out that spending $1 million on this vaccine will save about 400 DALYs. In addition, the extra productive years will add about $15 million to the economy. This means each DALY saved costs $2500.

Heartbug causes near instant death to seniors at around 65. There is a complex treatment regiment which costs quite a bit. Each treatment costs $1,250, and is 75% successful, thus $1 million spent on Heartbug treatment will save about 600 DALYs. There is no real economic benefit, and each DALY saved costs $1666.

If we value human life at $80,000 per healthy year, both Armpox vaccine ($2500/yr) and Heartbug treatment ($1666/yr) are very cost-beneficial. However, Heartbug treatment appears to be more cost-effective.

However, Armpox vaccines are administered to teenagers that are 15. For the people with Armpox, it’s already too late. For those eligible for the vaccine, disease is still a quarter century away. However, many of your senior constituents are passing away to Heartbug even as you read this article. Their family members are pleading with you to release funding for Heartbug treatment, but healthy teenagers are not speaking up at all for Armpox vaccines. Figuring that future health is not as pressing as current health, you reevaluate Armpox vaccines to cost $3500/DALY. This makes it even more obvious to choose Heartbug treatment, which is only $1666/DALY.

photo credit : Steve Punter’s

***
As you’re on the way to declare the funding of Heartbug treatments, old Mr. Octogenarian grabs your arms. “Look Mister, I’ve had my chance,” he says. “Make sure that my kids will be able to play catch with my grandkids!”

Taken aback, you realize that you might have been too hasty. You think back to your prime years…you figure year at 40 is probably worth three times as much as a year at 65, after all. After doing some complex number manipulations factoring in worth of a year at 40, 50, 60, 70, you come up with some new numbers. Armpox vaccines are now $1543/Ethical-DALY, whereas Heartbug treatments are still $1666/Ethical-DALY.

You hate to break the news to the seniors, but you’re going to be pushing for Armpox vaccines instead. It’s simply the best option you can do with your $1 million. Most of your taxpayers are pretty happy; they know that not a single dollar has been spent inefficiently. Some senior citizen advocates, however, are not. They realize that Armpox is the better deal, but the Heartbug treatment should also be done. How could you not pay the low cost of $1666 for a precious year of human life?

Even as you shrug helplessly, they argue passionately, asking you to go ahead and release the funds for Heartbug treatments, and pass the extra bill onto the taxpayers. The taxpayers are still getting a tremendous bargain, they say, and it’s the least we could do for our elders. You say that you’ll do what you can. You feel like you’ll never live up to your altruistic aspirations…but hey, it’s a start.