Jul. 21 2004
Washington, DC — U.S. District Judge Gladys Kessler today fined Philip Morris and its parent company Altria $2.75 million for destroying e-mail over a period of at least two years in violation of the judge’s 1999 order to preserve e-mail and other records relevant to the federal government’s lawsuit against the tobacco companies. According to the order Judge Kessler issued today, the e-mails involved eleven employees who “hold some of the highest, most responsible positions in the company” including “officers and supervisors who worked on scientific, marketing, corporate, and public affairs issues that are of central relevance to this lawsuit.” All but one were noticed for deposition by the government. According to the government, many of the e-mails concerned Philip Morris’ marketing practices, especially for Marlboro, which is the most popular cigarette brand by far among youth. Judge Kessler found that Philip Morris and Altria showed “reckless disregard” and “gross indifference” toward their legal discovery and document preservation obligations. In addition to the fine, the judge’s order prohibits Philip Morris from calling the employees in question as witnesses during the trial.
Philip Morris’ destruction of e-mails raises an obvious question: What is Philip Morris hiding? The e-mails in question go to the heart of a key government claim, which is that the tobacco companies have marketed and continue to market their deadly products to children. The government has presented powerful evidence that the tobacco companies continue to market to children in contradiction of their claims that they have changed since the 1998 state tobacco settlement.
This is not the only issue involving document destruction in the case. British American Tobacco has waged a fierce legal battle to avoid having to turn over a memo sought by the government that allegedly serves as a blueprint for the destruction of tobacco company records that might be sought in litigation. Judge Kessler last year fined BAT $25,000 a day and found the company in contempt of court for failing to turn over the memo.
The federal government’s tobacco lawsuit, which was filed in September 1999, is scheduled for trial beginning September 13. It seeks to hold the tobacco industry legally accountable for decades of illegal and harmful practices, including marketing to children and concealing the health risks and addictiveness of its products. In its filings in the case, the Justice Department has indicated that it will seek fundamental changes in the marketing, manufacture and sale of tobacco products, the recovery of more than $280 billion in illegal industry profits, and funding of tobacco prevention, cessation and research programs.