Statement: Regarding U.S. District Judge Gladys Kessler's Ruling Allowing Federal Tobacco Lawsuit to Proceed Under Two Rackeetering Claims

Washington, DC — While we are disappointed that Judge Kessler dismissed two claims in the federal government's lawsuit against the tobacco industry, we are pleased that the court ruled that the lawsuit can proceed under racketeering claims that are the most powerful parts of the government's case and potentially the most devastating to the industry. This ruling is a repudiation of repeated assertions by the tobacco industry and its defenders in Congress that the lawsuit is entirely without merit. Congress should heed this ruling by fully funding the lawsuit and allowing taxpayers their day in court, where the tobacco industry can be held accountable for decades of deception and wrongdoing. Any attempt now by the Congressional leadership to deny funding for the lawsuit can only be seen as an effort to provide special protections for the tobacco industry.

The federal government has a strong case to make under racketeering laws given the overwhelming evidence that the tobacco companies have conspired since the 1950s to defraud and mislead the American people and conceal information about the health effects of smoking. Importantly, the ruling notes the possibility of continued industry wrongdoing: 'As the Government points out, as long as Defendants are in the business of selling and marketing tobacco products, they will have countless ‘opportunities' and temptations to take unlawful actions, just as it is alleged they have done since 1953.'

In fact, the RICO statute under which the case will now proceed is the most powerful of the laws under which the government has pursued this lawsuit. It allows the disgorgement of profits gained through unlawful activity as well as injunctive action to prevent illegal actions in the future. As the ruling states, 'In sum, while the government's theories of liability have been limited, the extent of Defendants' potential liability remains, in the estimation of both parties, in the billions of dollars.'

It is also important to note that while the judge ruled that the federal government cannot sue under the Medical Care Recovery Act or the Medicare Secondary Payer provisions, this opinion was based on an interpretation of statutes and not a judgment on the facts of the case. It remains an indisputable fact that tobacco-related illness costs taxpayers billions of dollars each year through federal health care programs including Medicare, veterans health care, and military health care.

Taxpayers deserve their day in court to hold the tobacco companies responsible for their illegal behavior. We're pleased that the judge has ruled that the case should move forward.