Administration Wants to Settle Tobacco Suit
19 Jun 2001
http://www.latimes.com/news/nation/updates2/ap_tobacco010619.htm
Administration Wants to Settle Tobacco Suit
From Associated Press
WASHINGTON -- The Bush administration is seeking to settle a
protracted civil suit seeking billions of dollars in damages against the
tobacco industry, government officials said today.
Concerned about the strength of the government's case, the
administration wants to forge a settlement now rather than risk losing
later, said sources who discussed the case only on grounds of anonymity.
The decision was based at least in part on a decision last year by the
federal judge handling the case. U.S. District Judge Gladys Kessler threw
out two counts which would have allowed the government to recover some
expenses related to sick smokers.
In filing the suit in September 1999, the Justice Department, then
under the leadership of Attorney General Janet Reno, said federal health
care plans spend more than $20 billion a year treating smoking-related
illnesses.
Officials said Attorney General John Ashcroft has assembled a team of
three lawyers, all career attorneys in the department's civil division, to
work on the settlement.
The lawyers were meeting for the first time Tuesday with the
department's tobacco litigation team to begin talking about a potential
settlement, sources said.
Officials emphasized that the department was not abandoning the
lawsuit, saying it would continue to litigate the case even while pursuing
a settlement agreement.
The recommendation to seek a settlement was made to Ashcroft by Stuart
Schiffer, head of the department's Civil Division.
The Justice Department sued the tobacco industry to recover billions
of dollars taxpayers have spent on smoking-related health care, accusing
cigarette-makers of a "coordinated campaign of fraud and deceit."
The government alleged that the cigarette companies conspired since
the 1950s to defraud and mislead the American public and to conceal
information about the effects of smoking and the addictiveness of nicotine.
The lawsuit was filed against Philip Morris Inc., R.J. Reynolds
Tobacco Co., American Tobacco Co., Brown & Williamson Tobacco Corp.,
Lorillard Tobacco Co., British American Tobacco Ltd., Liggett and Myers
Inc., the Council for Tobacco Research-USA and the Tobacco Institute.
At the time the civil suit was filed, the Justice Department formally
closed, without charges, a nearly 5-year-old criminal investigation of
whether tobacco companies lied to Congress or regulatory agencies about the
addictive nature of tobacco.
The idea of suing the tobacco companies to recover money spent for
health care followed an expensive settlement that cigarette-makers reached
with most state governments a year earlier, based on state outlays for
health insurance. The industry agreed to pay the states more than $240
billion over 25 years.
The settlement with the states followed the collapse of an effort to
write federal legislation that would have substantially increased the cost
of cigarettes through taxes and would have restricted the marketing of
tobacco.
The decision to seek a settlement comes in the wake of several
setbacks in the case, including questions about whether sufficient money
would be available to pay for the litigation and Kessler's decision
dismissing two counts of the government's case.
Democrats accused the Bush administration of trying to kill the
lawsuit by not requesting more money to pay for litigation. The
administration earlier this year asked for $1.8 million to pay Civil
Division salaries and staff costs for the tobacco litigation team. That was
the same level of funding as had been requested by the Clinton
administration, which brought the suit.
However, the Clinton White House had sought help from other agencies
to cover the legal costs.
Ashcroft has said the Justice Department would proceed with the case
and has suggested that it would be up to Congress to set aside more money
for the suit. Lawyers within the department have said it would cost tens of
millions of dollars to continue the suit.
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