Tobacco Industry Watch

Big Tobacco Guilty As Charged

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Justice Department Civil Lawsuit

Updated July 1, 2010

On August 17, 2006, U.S. District Judge Gladys Kessler issued a final judgment and opinion in the U.S. government's landmark lawsuit against the major tobacco companies that found the companies have violated civil racketeering laws and defrauded the American people by lying for decades about the health risks of smoking and their marketing to children.

Judge Kessler also found that the tobacco companies' wrongdoing continues today: "The evidence in this case clearly establishes that Defendants have not ceased engaging in unlawful activity ... Their continuing conduct misleads consumers in order to maximize Defendants revenues by recruiting new smokers (the majority of whom are under the age of 18), preventing current smokers from quitting, and thereby sustaining the industry" (pages 1604-1605 of the opinion).

On May 22, 2009, a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit issued a unanimous opinion upholding Judge Kessler's judgment and almost all remedies she imposed in the case.

On June 28, 2010, the U.S. Supreme Court declined to hear appeals in the case, allowing Judge Kessler’s judgment and the remedies upheld by the Court of Appeals to stand. As a result, the verdict in this case is now final: The major cigarette manufacturers are racketeers who carried out a decades-long conspiracy to deceive the American public and target children with their deadly and addictive products.

This lawsuit began on September 22, 1999, when the U.S. Department of Justice filed suit against the cigarette manufacturers, charging that they had violated civil provisions of the Racketeer Influenced and Corrupt Organizations Act (RICO) and other laws. The trial lasted from September 21, 2004, to June 9, 2005.

Judge Kessler's 1,683-page final opinion powerfully and thoroughly detailed the tobacco companies' unlawful activity and the devastating consequences for our nation's health over more than 50 years.

"(This case) is about an industry, and in particular these Defendants, that survives, and profits, from selling a highly addictive product which causes diseases that lead to a staggering number of deaths per year, an immeasurable amount of human suffering and economic loss, and a profound burden on our national health care system. Defendants have known these facts for at least 50 years or more. Despite that knowledge, they have consistently, repeatedly, and with enormous skill and sophistication, denied these facts to the public, to the Government, and to the public health community... In short, Defendants have marketed and sold their lethal products with zeal, with deception, with a single-minded focus on their financial success, and without regard for the human tragedy or social costs that success exacted," Judge Kessler wrote (pages 3-4 of the opinion).

Despite the overwhelming wrongdoing she found, Judge Kessler felt constrained in the remedies she could impose on the tobacco industry because of a controversial appeals court ruling that restricted financial remedies under the civil RICO law. In her Final Judgment and Remedial Order, Judge Kessler imposed remedies that:

  • Prohibit the tobacco companies from committing acts of racketeering in the future or making false, misleading or deceptive statements concerning cigarettes and their health risks.
  • Ban terms including "low tar," "light," "ultra light," "mild," and "natural" that have been used to mislead consumers about the health risks of smoking and prohibit the tobacco companies from conveying any explicit or implicit health message for any cigarette brand.
  • Require the tobacco companies to make corrective statements concerning the health risks of smoking and secondhand smoke and their deceptive practices through newspaper and television advertising, their web sites and as part of cigarette packaging.
  • Extend and expands current requirements that the tobacco companies make public their internal documents produced in litigation.
  • Require the tobacco companies to report marketing data annually to the government.

Now that the Supreme Court has upheld the judgment and these remedies, it is critical that the trial court move forward with strongly enforcing these remedies.

The government and public organizations had sought additional remedies, including requiring the tobacco companies to fund public education and smoking cessation campaigns and to forfeit illegal profits. However, these were not imposed by the courts.

On July 22, 2005, Judge Kessler granted a motion by six public health groups to intervene and become parties to the case. These organizations are the Tobacco-Free Kids Action Fund (a 501(c)(4) organization affiliated with the Campaign for Tobacco-Free Kids), American Cancer Society, American Heart Association, American Lung Association, Americans for Nonsmokers' Rights and National African American Tobacco Prevention Network. funding for tobacco prevention and cessation programs.