Feb. 16 2005
Washington, DC — Two new developments today in the federal government’s lawsuit against the tobacco industry underscore the continuing importance of this case and its potential to fundamentally change how the tobacco industry does business and protect public health in the United States.
First, the U.S. Department of Justice announced that it would appeal the recent ruling by the U.S. Court of Appeals for the D.C. Circuit that disgorgement, or forfeiture, of illegal profits is not an allowable remedy under civil racketeering (RICO) laws. This ruling would preclude the government from pursuing billions of illegal tobacco industry profits should it win its civil RICO lawsuit against the industry. The Appeals Court’s ruling represents a fundamental reinterpretation of the civil RICO law that would make it more difficult to hold not only the tobacco industry, but other corporate wrongdoers accountable for their fraudulent activities. It is appropriate that the government seek a clear legal resolution of this issue.
Second, a new government brief filed today makes it clear that there is still a lot at stake in the tobacco lawsuit and it should be pursued aggressively regardless of the eventual outcome on the disgorgement issue. Even if disgorgement is not allowed, the Justice Department has argued persuasively that the trial judge can impose other remedies that would fundamentally reform the tobacco industry’s harmful practices and require the industry to pay billions of dollars to fund programs to prevent kids from smoking and help smokers quit. These remedies hold the greatest potential for reducing the death and disease caused by tobacco use in our country, which is what this case should be all about.
The Justice Department should continue to aggressively pursue the tobacco lawsuit so it realizes its potential for protecting public health. It should resist any efforts by the tobacco industry to seek a weak settlement that lets the industry off the hook for decades of fraudulent practices, including marketing to children and deceiving consumers about the health risks and addictiveness of tobacco products.