SETTLEMENT Talks News on the Web
Archive, June, 1997
Note: These articles wink in and out of existence with the frequency of sub-atomic particles. Many links will be dead. In that case, these pages can be approached as bibliographies, both noting the event, and showing where you might look for further information.
SETTLEMENT RESOURCES
- Remarks made by key Attorneys General on the tobacco deal at a Washington news conference.
- But Woods told reporters the dispute over protection for whistle-blowers was serious enough to threaten the talks. "We are not going to leave the wounded (cigarette company employees) who have helped us, behind. This is nothing we're going to give in on," Woods said.
- A historic deal remains just out of reach in the marathon tobacco talks but that has not stopped Senate tax writers from proposing a 20-cent-per-pack tax hike on cigarettes.
- Negotiators began trickling into meetings at mid-morning, many poring over terms of the deal written on loose sheets of paper. Some had stayed at overnight meetings until dawn. Sources said the two main sticking points were nearly resolved: whether the industry would pay punitive damages and how much control over nicotine the Food and Drug Administration would have.
- A comprehensive tobacco settlement is substantially complete, negotiators say, but was delayed yesterday by a few remaining issues -- and because the two sides have yet to agree on total price. An announcement could come today.
- The closed-door tobacco deal sparked a fierce public battle for the hearts and minds of the key players who will determine its fate -- President Clinton and Congress -- as critics uncovered multiple loopholes. Fine print in the 70-page deal sets strict limits on the Food and Drug Administration's ability to curb nicotine, so strict that former FDA chief David Kessler, who advises Clinton and some lawmakers on the deal, quickly demanded changes. "There are a lot of hurdles for the FDA, some impossible burdens," Kessler said Sunday on "Meet the Press." "This seems to be a step backward." A close reading of the deal shows that cigarette makers even secured a partial way out of multimillion-dollar penalties that proponents said would force tobacco companies to cut teen-age smoking. If companies prove they made a good-faith effort to cut teen smoking by 30 percent in five years and 60 percent in 10 years, they could get 75 percent reduction in the fine assessed for failing to meet the goals.
- Former FDA commissioner Dr. David Kessler and former Surgeon General C. Everett Koop joined a drumbeat of criticism of the landmark deal Sunday
- JACKSON, Wyo. (Reuter) - The landmark settlement with the tobacco industry was expected to be the focus of a meeting of the top state law enforcement officials beginning Sunday. The National Association of Attorneys General is holding its annual spring meeting in Jackson Hole, Wyoming. While support for the $368.5 billion settlement is virtually unanimous among the attorneys general, there are some dissidents.
- The challenge is monumental: the dismantling of a culture. Using money, media and medicine, antismoking forces aim to undo the work of centuries of literature and seven decades of Hollywood and Madison Avenue, to eliminate the automatic connection between a kiss and a curling column of smoke, between a shout of rebellion and the flick of a butt. The tobacco industry is willing to bet $368.5 billion that links so deeply embedded in the collective consciousness simply cannot be broken.
- 06/21/97 Industry Still Has Many Advertising Weapons Available Stuart Elliott, The New York Times (Free Registration)
- "The restrictions don't get to two core issues: Why do people, especially teen-agers, smoke, and what do the tobacco companies know about advertising?" Brody said. "If you don't face those issues, this is a waste of time," he added. It may be "a whole new opportunity for the tobacco industry to make fools of the legal community."
- [The settlement] dramatically reset the battlefield in the decades-long controversy over smoking and health, turning enemies into allies with just a few pen strokes.
- "It is a highly innovative proposal, but it is very uncertain whether it will survive," said George Priest, a professor at Yale Law School. "No one believes people will stop dying of lung cancer. My suspicion is that litigation surrounding cigarettes will never end."
- "Before we celebrate, let's remember that the next few months will be critical. There will be many hurdles this deal must clear in Congress before it's final," Chiles said in a news release.
- "Cigars certainly were not the target, but they will be affected by the agreement," said Florida Attorney General Bob Butterworth . . . A representative for the cigar industry Saturday complained stogies are being unfairly lumped into the same category as cigarettes, even though cigars pose a much lower health risk and are less tempting to children. While the agreement still requires the approval of Congress and President Clinton, the cigar makers are concerned about two provisions: -- The Food and Drug Administration would be granted the authority to regulate nicotine levels in tobacco and ban nicotine outright by 2009. -- Tobacco products would be removed from shelves in food and convenience stores and placed behind cashier counters to reduce access to children. "The problem is, under the guise of protecting kids, it's going to be an excuse to regulate all tobacco products," said Norman F. Sharp, president of the Cigar Association of America.
- Texas Republican Party Chairman Tom Pauken, who plans to seek the GOP nomination for attorney general next year, ripped into Attorney General Dan Morales Saturday for giving political contributors a "huge windfall" in the tobacco settlement. . . Pauken did not comment on the $358 billion deal . . . Pauken, however, blasted Morales for retaining private trial lawyers, including some campaign contributors, to represent Texas in its suit against tobacco companies for yet-to-be determined contingency fees. "I just think it's an inherent conflict of interest for a man who is attorney general (and) solicits and receives major contributions from lawyers and gives them a huge windfall in this case," Pauken said.
- The Senate majority leader said that he hasn't had a chance to review details of the prospective $368 billion settlement. But he added, 'I'm pretty familiar with the broad parameters of it though,' given that a lead attorney general is from Mississippi and 'my brother-in-law is one of the attorneys involved. . . So I have to say right upfront that in the end I am probably going to have to recuse myself from the final vote, because I don't want even any appearance of conflict,' Lott said.
- While much of their rhetoric centered on children, the state attorneys general who battled the tobacco companies went after the money in Friday's negotiated proposed settlement. And the amount of money spent in connection with cigarettes -- especially on treating the illnesses caused by the legal weed -- is huge.
- Negotiators who put together the landmark tobacco settlement say the deal assumes that cigarette prices will quickly rise by 40 to 75 cents per pack, an increase the deal's proponents say will be one of its most effective ways of curbing sm
- "The paradox here is that we have had to keep the industry financially healthy in order to finance its own demise," explained Iowa Attorney General Thomas Miller, a hard-liner among the attorneys general. In effect, the proposed settlement would translate into a 75-cent per pack increase in the federal cigarette tax, which would require each new generation of smokers to pay for the health consequences of smoking by previous generations.
- Tobacco companies agreed on Friday to pay $368.5 billion, admit that tobacco is addictive and accept extensive federal regulation over their products and their advertising as part of a landmark agreement. In return, the companies, which have never before been forced to pay for tobacco-related illnesses, would be given immunity from any further punitive liability for deception, fraud or conspiracy that might have occurred in the past. . . "We are here today to announce what ... we believe is the most historic public health achievement in history," Mississippi Attorney General Mike Moore told a news conference. "We have reached agreement in principle with the tobacco industry."
- An article yesterday about the economic implications of the tobacco settlement misstated the public and private medical costs incurred annually from smoking-related illnesses. The Centers for Disease Control and Prevention said the cost is $50 billion a year.
- President Clinton Friday said he was naming two top administration officials to head a panel to review details of the tobacco settlement agreement to insure it protects the public health.
- Anti-smoking advocates say they have to sift through the deal carefully to see if they approve, with several saying a glaring problem is a lack of limits on tobacco exports.
- Leading congressional critics of the tobacco industry reacted with caution and some suspicion yesterday as news of a settlement became public. "If the tobacco companies think Congress is going to rubber-stamp this agreement, I have one question for them: What are you smoking?" said Senator Frank Lautenberg, a New Jersey Democrat and a leading proponent of regulating the tobacco industry.
- The House Commerce Committee chairman opened the door to review of the proposal by his committee but didn't tip his hand about his opinion. "While Congress hasn't been a party to these negotiations, it's clear that major provisions of the agreement will require federal legislation, and anything this important deserves a full, fair and public review by the Congress," Bliley said in a prepared statement. Virginia's only lawmaker on a House task force on tobacco and health, on the other hand, said the $368.5 billion proposal "sounds reasonable to me." Rep. James P. Moran Jr., a Democrat from Northern Virginia, liked removing the Marlboro Man and Joe Camel from advertising
- "If it helps kids with health care, I would be inclined to support it. If it simply makes trial lawyers richer, I would be inclined to oppose it."
- Cigaret companies simply will pass on most of the cost of the pact to consumers, analysts said. That means cigaret price hikes will be 75 cents to $1.50 a pack.
- "After the whole emotional roller coaster of his death was over, I realized this cannot continue to happen. There was no way tobacco can continue to addict children," Dianne Castano said Saturday. She and a dozen other plaintiffs from around the nation gathered in New Orleans Saturday to share their personal stories, a day after a $360 billion settlement between the tobacco industry and 40 states.
- [Ralph] Nader says the tobacco settlement that some expect to be announced today is "premature, overblown, incomplete and terminally flawed."
- The American Lung Association believes that this settlement is premature and wrong. We cannot support this settlement. We call on President Clinton, Congress, Governors and the public to carefully and completely review all terms, legislative language, consent decrees and contracts.
- That would seem an impossible pledge to give in a country of vast borders that failed to halt the flow of illicit alcohol during Prohibition and is today awash with illegal drugs.
- The tobacco companies agreed to yesterday's landmark settlement to end the uncertainty an endless stream of lawsuits might have had on their future. But Wall Street analysts poring over details of the agreement say there is still plenty of uncertainty about the industry's future and its future appeal to investors.
- When asbestos was shown to cause cancer and lung disease, the resulting lawsuits killed the asbestos industry, with all its profits eventually going to its victims and their lawyers.
- Chief executives of Philip Morris Cos., RJR Nabisco Holdings Corp. and other companies hold stock and options that could rise as much as $65 million by the end of next year, based on analyst estimates that take the settlement into account. Much of that amount would go to Philip Morris CEO Geoffrey Bible, whose holdings could rise as much as $50 million.
- "The proposal is a bitter pill because our companies have made concessions that were extremely difficult," said Philip Morris Cos. Inc. Senior Vice President Steven Parrish, reading a statement on behalf of the tobacco industry. "But on balance, this plan is preferable to a continuation of a decades-long controversy that has failed to produce a constructive outcome for anyone."
- The great irony here is that Wall Street long pushed for a settlement - and was a major reason the tobacco companies came to the table - yet the Street didn't like the broad outlines of the settlement that emerged . . . One institutional investor sees a silver lining in the adverse market reaction. "If the stocks had rocketed upward after the news, it would have been harder to get Congressional approval because the settlement would have been seen as pro-industry," he says. "Friday's action increases the chances of congressional passage."
- --At Close:--
- PM down 2 to 45.50
- RJR down .87 to 35
- LORILLARD down 3.25 to 103.375
- UST down 1 to 29
- BAT up .125 to 19.937
- BROOKE up .125 to 4.75
- "For nearly 30 years we have had a mutually beneficial relationship with R.J. Reynolds and its Winston brand. We have not had an opportunity to review the proposed agreement so it would be premature to speculate on what effect this will have on motorsports. While the settlement has been announced, it must still face Congressional as well as Presidential review while also facing litigation that has already been filed. NASCAR racing has been in existence for nearly 50 years, long before tobacco companies became actively involved in the sport. With the monumental growth we have experienced in recent years, and the anticipated continued growth of motorsports, we will continue to aggressively promote the sport."
- "The New Jersey Hospital Association is encouraged that a settlement with the tobacco companies may provide the long-elusive answer to how to fund charity care for the remainder of fiscal year 1998. We applaud our legislators, especially Assembly Speaker Jack Collins, for having the foresight to include a budget provision to channel tobacco lawsuit money to charity care. "While today's settlement is promising, what remains to be seen is how much funding the deal will provide. New Jersey hospitals will spend $407 million caring for the state's poor and uninsured this year. Hopefully, this money will allow for fair reimbursement for the hospitals that provide this critical safety net for New Jersey residents. "There remain some uncertainties regarding the timing and scope of this settlement -- Congress still must approve it -- but we are cautiously optimistic about this development. "Because tobacco products contribute greatly to healthcare costs, it is appropriate that a significant amount of this settlement be earmarked for healthcare delivery."
- In a statement Kelley says "speaking for Michigan, I cannot consider endorsing the proposed settlement until I have had an opportunity to analyze all the specific documents as to their legal implications." Kelley says he will consult with Gov. John Engler, state Health Director James Haveman and "the public health community, before settling my lawsuit."
- "This settlement does not eliminate the need for Blue Cross and Blue Shield of Minnesota to proceed with our lawsuit. Our litigation is not settled by the announced deal. We will press forward. Such a settlement does not accomplish what we originally set out in our lawsuit. Namely, to fundamentally change the way the tobacco industry does business. . . we urge Congress and the White House not to give in to any deal that contributes more to tobacco's interests than to the health interests of Minnesotans and all Americans.
- The lawsuit was filed Thursday on behalf of the Transport Workers Union (TWU) New York City Private Bus Lines Health Benefit Trust and the Laborers Local 17 Health Benefit Fund. It seeks recovery of funds spent treating tobacco-related illnesses of union members -- the same compensation sought by the 40 states that sued the industry on behalf of their Medicaid plans. The union funds seek status as a class action and qualification under federal racketeer-influenced corrupt organization (RICO) law
- Taking a share of credit for the tobacco settlement, Massachusetts Attorney General Scott Harshbarger delivered a roundhouse punch yesterday to Joe Camel. But Harshbarger may hope that the opponent left staggering is Joe Kennedy. Harshbarger, planning to run for governor next year and likely to face Representative Joseph P. Kennedy II in the primary, has gained political exposure from the tobacco issue, portraying himself as a warrior battling a wily enemy
- Long before Mississippi Attorney General Michael Moore led the fight to regulate America's tobacco industry, he was a crusading local prosecutor searching out corrupt small-town politicians.
- "We won't leave our wounded on the beach," said Arizona Attorney General Grant Woods. B&W eventually gave in, and Florida Attorney General Bob Butterworth declared Wigand "a true American hero."
- 06/23/97 CLINTON Promises Careful Review Reuters
- 06/22/97 CLINTON Wants 30 Days to Review Deal Knight Ridder/POSTNet ("hot off the wires"--expires quickly)
- 06/23/97 CLINTON Addresses Tobacco at End of Economic Summit Washington Post
- 06/22/97 CLINTON SUMMIT Speech Transcript-3: On the Settlement AP Washington Post
- And what we have to -- those of us who are on the outside of this, who represent the public interest have to do, is to make sure that those things which made the tobacco interests conclude that it was in their interests to make the agreement do not compromise or undermine our obligation and our opportunity to protect the public health, and especially children's health and reduce child smoking.
- 06/22/97 CLINTON SUMMIT Speech Transcript-3: On the Settlement AP Washington Post
- 06/22/97 CLINTON SUMMIT Speech Transcript-5: On FDA Removal of Nicotine AP Washington Post
- How could you prove there wouldn't be a black market? What is the definition of black market? Is a one percent penetration a black market, or does it have to be 10? That's why I have been so reluctant to answer these questions . . . that's why we need to take the time to really analyze it and make sure there's not something there that would have an unintended consequence that for all I know neither party meant to have.
- Well, as I understand it, it does not protect them from liability for actual damages. It protects them from liability for past punitive damages, and still permits punitive damages if they are ... if there is misconduct from the date of the agreement forward. Now, in the law the purpose of punitive damages is to deter future destructive behavior. And the concept of punitive damages is provided not because the person suing is entitled to it because of his or her injuries, but because you think the injuries are not enough -- compensating this person is not enough to take the profit out of whatever anti-social conduct and illegal conduct the defendant was engaging in. . . it's an unusual and unique resolution. . . Can you have in effect an advance payment for punitive damages? Does it sort of ... can it ... does that plus all the other things that would be good from a consumer's point of view and the public's point of view? Would that be enough to kind of offset the troublesome areas?
- Makers of liquor may be a target. But no maker of an unhealthy product is safe, not even makers of barbecue grills, says Michael Horowitz of the Hudson Institute. "It's absolutely clear that charcoal broiling is carcinogenic." State attorneys general say tobacco is unique, and other industries shouldn't be worried. . . Who's next? "How about all those states advertising to come bask in the sun?" says Horowitz. "A lot of melanoma comes from undue exposure. Sunshine kills, there's no ifs, ands or buts about it." States such as Florida and Hawaii that have been at the forefront to get tobacco companies to pay billions of dollars to cover the medical expenses of lung cancer and other tobacco-caused disease, could wind up fending off suits from rainy states such as Oregon, he says. "I can't take that seriously," says Cynthia Quinn, assistant to Hawaii's attorney general.
- afternoon trading. More than 11 million shares changed hands in consolidated trading. Also on the NYSE, RJR Nabisco Holdings Corp. (RN) fell $1.625 to $33.375, Loews Corp. fell $2.125 to $101.25, and UST Inc. lost 75 cents to $28.25.
- Tobacco bond prices fell on Monday as buying dried up on uncertainty about the implications of last Friday's news of a settlement between tobacco companies and the states, market players said.
- "We are seeing a fairly substantial implosion of volatility, especially in the front months, in both Philip Morris and RJR Nabisco," said Andrew Schwarz, senior partner at AGS Specialist Partners.
- Tobacco advertising isn't going away in a puff of smoke under terms of the proposed settlement . . . But marketing gurus say there are other options for the industry. "Like the tax code, there are lots of loopholes in this," says adman Daryl Travis.
- Christopher Pook, president and chief executive officer of Grand Prix Association of Long Beach, said Monday that the settlement is expected to have minimal impact on the association's revenues. "Tobacco-related revenues are not a major part of our revenue stream," Pook noted. "They represent approximately 3 percent of revenue from the Toyota Grand Prix of Long Beach and only about 3.25 percent overall company-wide." Revenues generated by the 23rd Annual Toyota Grand Prix of Long Beach held in April attracted record crowds and generated more than $11.8 million. "Like most companies associated with motorsports, we have had an enjoyable and beneficial relationship with the tobacco industry for a number of years, and we appreciate its contribution to the sport's growth and popularity," Pook said. "However, that relationship has been limited to 'official product' status. It does not involve title sponsorship of any of our events."
- Three times before its signing last Friday, the now-historic $368 billion proposed tobacco settlement nearly died on the table. On each occasion - including one in Dallas - unexpected trouble boiled up in the ranks of anti-tobacco forces, pushing some of them perilously close to calling it quits. And each time, only the patience of Big Tobacco and its desire for a deal permitted the talks to get back on track, according to eight negotiators from both sides
- Who's going to feel that pain? The tobacco companies themselves? Sure, but not $368 billion worth. They plan to share the pain and the cost with a cast of other players--tobacco farmers and workers, convenience store owners, advertisers and, especially, smokers.
- [T]he pact has a secret weapon: power of the states. Inserted in the middle of the 68-page proposed tobacco settlement is a little-noted provision calling for "consent decrees" with the states. These are agreements, to be filed in state courts, that would back up most of the provisions of the national accord. "This industry will face regulation no matter what. This agreement is a floor, a foundation," said Massachusetts Assistant Attorney General Tom Green, one of the principal architects of the pact. "If for whatever reason the FDA doesn't do the job, the states could get into the act."
- 06/23/97 Pact's Limits Presage Brutal National Debate
- [A]ccord . . . could begin a national debate on whether the cigarette industry got off too light. The agreement faces months of scrutiny in Washington, where key players appear willing to turn it into law.
- Opponents say . . . a provision eliminating punitive damages for past industry conduct may violate constitutional safeguards guaranteeing due process of law and the right to a jury trial.
- The landmark tobacco settlement entails a litany of provisions to help millions of Americans quit smoking. But the measures are unlikely to be enough to neutralize the addictive appeal of nicotine.
- The Israeli Health Ministry says that it plans to file a $7.9 billion lawsuit in Israeli court against local and foreign tobacco manufacturers to help pay for the health system's costs of treating smokers.
- Analysts agree the tobacco settlement should be good news for cigarette stocks, but many investors are dumping the stocks.
- A particular offender was the Mississippi attorney general, Michael Moore, who littered his post-agreement press conference with gloating threats to "punish" and "destroy" the tobacco industry and its representatives. . . . Nonsense. All it revolutionizes is the ability of bureaucrats to short-circuit the democratic process - and of powerful companies to carve out special treatment under the law.
- The last thing the so-called "settlement" will do is settle anything. At best it is a proposal to Congress, perfectly capable of layering in new slabs of hypocrisy. . . . First, give the tort lawyers one last bonanza, if you must, but in return apply the strictures of no punitive damages and no class actions suits to all lawsuits, affording this protection to good products as well as one that is demonstrably dangerous. . . . Finally, yes, boost the tax on cigarettes. Boost it, indeed, until its revenues start to fall because of declining consumption. This is called the Laffer Curve. Then take these reduced revenues into account in projecting how much future income politicians would have to spend. This is called dynamic analysis. Then apply these same concepts to other taxes and spending, to create a budget process not driven by the addictive cravings of politicians.
- What should we accept in such a settlement? We should take the tobacco business, all of it, including foreign subsidiaries, as part of an agreement to let these companies keep their cookies, cheese, and beer. We should let the government make plain cigarettes available (no fancy brands, no advertising, no nicotine boosting additives, no campaign contributions) for smokers who can't quit. We should take the money from the sales of these cigarettes and use it to help tobacco workers and farmers retool and to run a big, aggressive anti-smoking campaign (modeled on California's successful campaign) to reduce smoking as quickly as possible. Since we will own the overseas business, we can simply close it so that America can no longer be accused of exporting death.
- The American people deserve a wide-open airing of this deal and a sense that Congress and the administration are reviewing it solely in the public interest. One way to help assure the reality and perception of such a review would be for all members of Congress, the president and the Republican and Democratic national committees to forgo any contributions from the tobacco industry and the trial lawyers for the next couple of years. Any takers?
- USA View: Congress and Clinton say they'll review every detail. They'd better. History says that when deals are made, tobacco wins.
- Opposing View consists of Excerpts from Settlement Preamble
- Unless this empowerment--to control not only the nicotine content of cigarettes, already approved by a federal court, but their tar, carbon monoxide, carcinogenic flavorings and other additives as well--is a basic part of the deal and not conditioned on the FDA's having to meet evidentiary standards of the industry's devising, the whole settlement package is a toothless wonder and should be tabled. . . [I]t is Congress, so long under his party's control, that deserves public scorn for letting a dirty business get away with mass mayhem all these years. The lawmakers will now have the chance to redeem themselves, ideally without resort to the usual antiregulatory rhetoric from the present Republican majority. If government will not act effectively to protect the public health, how can its very existence be justified? Death, after all, is relentlessly nonpartisan.
- The unintended consequence of each new restriction has been to make smoking a badge of honor, a sign of one's refusal to give in. And now, with last week's agreement--with this consensus arrived at by America's cynics and pols and buttinskies--the attractions of smoking can only grow.
- Are there any circumstances under which someone has the right to intentionally addict people to something that will kill them? And if not, why should the government allow them to continue to do it? This deal does just that by allowing the tobacco industry to walk away from criminal behavior - intentionally misleading the public about the dangers of cigarette smoke and boosting the amount of nicotine to keep smokers hooked. . . This was an historic opportunity to put cigarette manufacturers out of business for good. If Congress signs off on the deal, it will let the tobacco industry continue to blow smoke in the public's face.
- NOW MAYBE the country will spend some time discussing, seriously and in public, what should become of the tobacco indus try. . . The value of the agreement is that it forces the discussion, but the agreement itself is hard to read.
- Congress and the president should strengthen this deal where it is weak, moving quickly to make it law.
- One element of the settlement was sadly predictable, however: Not one thin dime for tobacco farmers or their communities. . . The omission of farmers from the settlement is hardly surprising. States began suing tobacco companies three years ago. But not Kentucky. Gov. Paul Patton weighed in on the side of the cigarette sellers in the fight over FDA regulation. . . if you're not at the table, you're easily forgotten. And farmers -- whether out of allegiance to the tobacco companies, their own inertia or bad advice -- chose not to elbow their way in. So they were left out. . . But, foremost, farmers better start looking out for themselves. Or they'll be the only losers in this deal. As he unveiled the settlement, Mississippi Attorney General Michael Moore was referring to the cigarette industry's exploitation of the American people, not farmers. Still, his words keep echoing with a special ring in the Burley Belt. This, he said, is "the beginning of the end."
- In the end, of course, the anti-smoking forces were more or less compelled to resort to force because, in trial after trial, ordinary Americans were holding plaintiffs responsible for their own behavior -- and refusing to return verdicts against the tobacco companies. Would that common sense of this sort had informed yesterday's "historic settlement."
- The truth is, it would be far more damaging to the tobacco companies if the state lawsuits were allowed to run their inevitable course. Eventually, Big Tobacco would be driven bankrupt, and smoking as we know it would end once and for all. This compromise is unnecessary, counterproductive and unethical.
- The tobacco companies' capitulation to these anti-smoking criminals is the biggest stab in the back ever committed upon innocent people. They literally snatched defeat from the jaws of victory. We believe it proves that they have conspired with the anti-smokers all along. Their supposed "battle" against the anti-smokers has been nothing but play-acting, a sham to deceive smokers that they lost fair and square and didn't sell us out. . . . These anti-smoking conspirators must be prosecuted, and pay for their crimes against over 50 million people with the DEATH PENALTY. Nothing else will be sufficient for the magnitude of their offenses.
- Could Filipino kids end up paying Mississippi's Medicaid bills? That could be one of the perverse outcomes of ongoing negotiations . . . Five years ago, a tobacco analyst with Sanford Bernstein, an investment management firm, told me that the tobacco multinationals' optimism about Eastern Europe is predicated on people in the region "not being well enough educated to have health concerns about smoking." Perhaps "fifty years from now they will realize that it is bad for you, and consumption will drop then," she added. A settlement that excludes the rest of the world would help condemn Eastern Europe and the Third World to this grim fate.
- But lurking below the surface is a tangle of hidden agendas and private ambitions. This odd partnership of super-wealthy lawyers, one or two public health advocates and several attorneys general speaks constantly and in sincere tones about saving millions of lives, recovering billions of dollars, and punishing the industry. But you will not, for example, hear an attorney general acknowledge they are here, at least in part, to advance their political careers, though many of those most directly involved are said to be considering higher office.
- You may not mourn the Marlboro Manıs passing, but you should mourn the rugged individualism he once symbolized. Thatıs a commodity thatıs disappearing from the American scene far more rapidly than tobacco.
- According to Douglas J. Wood, executive partner of New York-based Hall Dickler Kent Friedman & Wood LLP, "those parts of the settlement that undermine free speech need to be reviewed and removed from the final agreement. If not, they cast a dark cloud over the First Amendment rights of all advertisers, not just tobacco." Hall Dickler Kent Friedman & Wood is a general practice law firm headquartered in New York. The firm has specialized in advertising, marketing and promotion law for over 50 years
- For another, the full deal has not yet been released. All that is now public is a summary, which, by definition, leaves out the fine print. Remember, both God and the devil are in the details. . . And two other voices will be key those of former Food and Drug Administration chief Dr. David Kessler and former Surgeon General Dr. C. Everett Koop. These two have done more to fight tobacco and youth smoking than any other Americans. Both already have praised aspects of the deal and raised concerns about other parts. That puts them right where they and all thinking Americans should be.
- If the $45 billion industry is desperate enough for a settlement that it is willing to close the loopholes, then a settlement would be a major step in the fight against smoking-related illness. But the hazards of signing on to a weak deal outweigh the advantages of a quick settlement. As Kessler said when he saw the settlement, "If you are going to make a deal with the devil, you have to make sure you get his horns and his fork."
- But the deal raises some extremely serious concerns about the requirement that the tobacco companies surrender their 1st Amendment rights. . . The accord has been attacked by anti-smoking activists, who would like the industry to vanish. It has the potential to strike a balance between limiting the damage caused by smoking and preventing a dreadful repetition of Prohibition. Unless its assault on the 1st Amendment is removed, though, it won't deserve congressional approval.
- At this point, with experts still poring over the fine print, it's too soon to tell how much the plan needs to be altered to work well. But it seems clear the public's elected representatives ought to get a better deal from an industry that killed millions while its leaders lied to Congress and the American people.
- Before our skepticism abates, we also need an answer to another question: If this deal is agreeable to the tobacco industry, how can it be so good for the country?
- The vast majority of smokers make a free choice, a Faustian bargain: Knowing they may live a half-dozen years fewer, they opt for cigarettes, which, in addition to pain, offer pleasure, solace and wisdom (as Sartre and Mallarme can attest). . . Instead, we have an insane tobacco deal that sends precisely the wrong message to both adults and children: You're not responsible for your own health. Or anything else for that matter. . . The tobacco deal will enshrine this noxious idea into law . . . For the companies themselves, I have no sympathy . . . it would be a joy to see their shares plummet. In their cowardice and disregard for principle, they're just as villainous as the rest of the actors in this sordid drama.
- No tobacco company ever made anyone start smoking. All any tobacco company ever did was afford the means to an end that the smoker decided on himself. That's true even if tobacco companies did not share all the data they had about their product and its effects and even if their advertising was once all-pervasive and highly persuasive. People still knew that smoking was risky and addictive and could exercise their free will in determining whether to do what was good for them or would be bad for them. The most insidious aspect of the current war against tobacco is its assault on self-accountability. If you forfeit that concept, the idea of a free, orderly self-governing society becomes unsustainable. The proposed tobacco settlement has at least the virtue of eliminating class action liability lawsuits and of eliminating punitive damages for past actions in individual suits. Tobacco company officials scarcely resemble angels, but they are utterly incapable of programming us like robots.
- I do not find an admission of guilt, a confession of greed, an acknowledgment that they always knew the evils of smoking, but hey, they wanted to make a buck. I want the tobacco biggies, the guys who make millions of dollars, to say they were wrong -- sluts for a dollar -- and now they will devote the rest of their lives to a worthwhile cause. . . I'd like kids to learn that profits do not counterbalance immoral behavior and you cannot yell "free will!" when, as it happens, you are selling a sweet poison. I want contrition. What I'm getting, though, is more smoke.
- Critics of this proposal, including the consumer advocate Ralph Nader, complain that it does away with justice by the courts. But getting rid of the courts is the point: one legislative judgment will replace millions of claims in litigation. However the final terms are ironed out, the public will be dramatically better off. . . The tobacco settlement finally acknowledges that it is far better for the legislature, not the courts, to resolve injuries that affect society as a whole.
- The tobacco ruling opens the floodgates. It says: "Here are a bunch of guys who made profits without regard to the medical damage that their products cause. Now they have to pay." It is a lesson the likes of T&N and the chemical companies have learned with their asbestosis liability or environmental clean-up cases in the US, that the sins of 20 years ago can come back to haunt you today. Claiming you have cleaned up your act may not help. If you are a carmaker whose new models stand up to the emissions tests, you will have to pay out for the lead poisoning caused by your 1960s model.
- "To the naysayers I say: 'OK, guys, you do it. This country's been waiting 50 years for you to do it,"' Moore told a press conference at a meeting of the National Association of Attorneys General. "Now, we've made a tremendous step forward here. The only people who will lose, if this bill is not passed, are the children of this country and the public health of this country."
- Massachusetts could collect up to $12 billion over 25 years from the landmark tobacco settlement if it is approved by Congress - a windfall that would go toward health costs and ultimately make the state's overall fiscal life easier for years.
- "When you look at the fine details, the settlement could affect or really impede FDA's ability to regulate nicotine and tobacco products," Kessler said Sunday on the NBC program Meet the Press.
- Far from ending the legal battle over tobacco, the settlement plan reached last week between state officials and the industry may spawn a fresh round of litigation that will keep the issue in the courts for years.
- "It's pretty obvious the Congress isn't going to act like a potted plant," Senator Ron Wyden told ABC's "Good Morning America." "There's going to be some major rewriting of this."
- House of Representatives Speaker Newt Gingrich was among the top 10 members of Congress in contributions received from the tobacco industry during the last election cycle. And Philip Morris Cos. Inc., the world's largest cigarette maker, contributed more so-called "soft" money to political campaigns than any other American corporation, watchdog groups said. . . "Congress has to approve whatever agreement, and given the influence of tobacco on elected officials, the American public has to ask if that agreement is best for the American people," said Celia Wexler, a lobbyist for Common Cause, a public interest group that focuses on campaign spending issues.
- "It's pretty obvious the Congress isn't going to act like a potted plant, and there's going to be some major rewriting of this agreement," Sen. Ron Wyden, an Oregon Democrat, told ABC's "Good Morning America. The edits are not going to be minor ... we need to toughen this deal." But Mississippi Attorney General Michael Moore, appearing on the same program, said the attorneys general might seek to kill the deal if congressional lawmakers make certain changes to it. "If they make changes that would hurt our deal or do something that we think wouldn't benefit the public health of the country, or children, then frankly we'd want the deal killed and we'd go try our cases," Moore said.
- Rep. Ed Whitfield, R-Ky., said some of the money left over after smoking victims are paid should go to farmers looking for a way out of the business. "There has to be some money that would give tobacco farmers an opportunity to sell their allotment if they want to do it."
- David Logan, a law professor at Wake Forest University, said that the settlement lets opponents know how much cigarette companies can pay if they actually lose lawsuits. And it also may change the way that juries think about tobacco companies, he said. Juries have declined in nearly all cases to award money to sick smokers because they believed that smokers should bear most or all of the blame for taking up a risky habit. . . . "There's a ratchet effect. When people hear about billions of dollars, it makes hundreds of thousands sound like peanuts." "We are in never-never land," Logan said. "We've never been here before. No judge has been in this situation before, no legislator, and no president." The proposed settlement also means that both sides will have to decide whether to ask for trial delays or proceed with cases that may be abandoned if the deal is successful.
- The agreement put together by lawyers is now being dissected by lawyers -- and there's plenty of disagreement. The Association of Trial Lawyers of America issued a statement that said "every detail must be thoroughly scrutinized for what limitations it places on Americans' legal rights." The trial lawyers association opposes the idea of freeing cigarette makers from paying punitive damages. That's also where trial lawyers make a lot of their money.
- An outbreak of blue mold has cost them sleep, but Virginia's burley tobacco growers say they're more anxious over last week's tobacco-industry agreement, with some growers saying they might ask Congress to rescue them from the deal
- At the annual meeting of Southwest Virginia burley growers in Richmond this week, farmers said they want the deal to include guarantees that tobacco companies will buy just as much burley in the future as they're buying now.
- Phil Carlton, a former justice on the N.C. Supreme Court and the lead negotiator for the five tobacco companies, said that the talks will resume Thursday to tie up several major loose ends, and he plans to raise the issue within the next few weeks. "I'd like to give our tobacco growers some certainty out of this hullabaloo," said Carlton, a lawyer from Pinetops, about 15 miles southeast of Rocky Mount. "The farmers are going to come out fine, in my opinion."
- "All we're going to do is change the name on the door," said institute vice president Walker Merryman, noting that the deal--with some stipulations--allows the formation of a new industry trade association after the old one has been dismantled. Merryman added: "We're going to continue to do what we've always done. I don't really understand why they're going through this exercise, frankly."
- Marc Kasowitz, who represents Liggett's parent company, the Brooke Group Ltd., said that Liggett had been assured by the state attorneys general and plaintiffs' lawyers negotiating with the industry that the much smaller settlement it had reached in March would be preserved. But, Kasowitz said, that provision was not included in the agreement announced last Friday. He said Liggett, the maker of Chesterfield and Lark cigarettes, was mounting a campaign to have its March contract with the state attorneys general honored.
- 06/23/97 LIGGETT Seeks Protection from Suit AP Washington Post
- 06/23/97 BROOKE Says Pact Would Bankrupt LIGGETT Reuters
- Attorney Marc Kasowitz, who represents Brooke and negotiated its March tobacco settlement, told Reuters that the deal struck on Friday unfairly burdens Liggett, maker of Chesterfield and Lark cigarettes. "You really have an unfair, ironic and outrageous situation here. The one company that had the courage and took the steps of breaking with the entire industry...is now in a posiition where it's going to be bankrupt if the settlement is enacted into legislation," he said in a telephone interviiew.
- If the U.S. Congress blesses the deal, it's widely believed that RJR would aggressively pursue such a move. Two analysts said that a spinoff could come as early as next summer. RJR officials have said for some time that they are committed to spinning off the 80.5 percent-owned Nabisco Holdings Corp. food business to shareholders, but only when the time is right. That time, the company has said, would be when it could eliminate significant litigation risks from its tobacco operations. The settlement -- which calls for the banning of future class-action suits, the consolidation of multiple suits and punitive damages for past conduct, among other things -- opens the door for the tobacco companies to spin off their non-tobacco assets.
- Kaplan said cigarette makers have occupied some of the better-situated billboards owned by his firm. He's figuring that as those boards become available, they'll be easier to sell for that reason.
- BAT Industries will not seek to offload the cost of its landmark tobacco liability settlement in the United States on its UK insurers, a move that will relieve firms with BAT policies, including Commercial Union and Royal & SunAlliance.
- Wednesday, the two [Koop, Kessler] will ask the nation's top health groups to debate five questions:
- Was FDA's authority to control nicotine too restricted? A North Carolina judge recently ruled the agency can control nicotine like any other drug, but the tobacco deal set up hurdles before the agency can act.
- Does the deal properly penalize tobacco companies?
- Will a settlement be funded by increased sales in developing countries?
- Is the money fairly divided, with about 20 percent earmarked to fight smoking?
- Is $1 billion enough for smoking cessation programs to cover any or all of the 45 million American smokers who want to quit?
- "If you take away the FDA's flexibility to regulate nicotine and the penalties are not in place and class-action lawsuits are banned, then there's no leverage left on the industry if it fails to comply with the agreement," said Jeff Nesbit, executive director of the Advisory Committee on Tobacco Policy and Public Health.
- State attorneys general Monday were surprised by the degree of negative reaction to the proposed tobacco deal, particularly the criticism from former Food and Drug Administration chief David Kessler. Meeting here for a national conference of their peers, some attorneys general said they expected criticism, but not to the
- [S]tate attorneys general Tuesday offered a spirited defense of the pact they reached after nearly three months of negotiations, describing it as an unprecedented leap forward on a vital public health issue. "It isn't perfect, but it's the best anyone has put forward," said Washington state Attorney General Christine Gregoire "To those who say 'wait,' I say 'when?' To those who say 'not this,' I say 'what?' To those who say that Congress could do something, I say, 'what in the history of Congress leads you to believe that?' " . . . . "It's a historic alliance of attorneys general that is unprecedented in American history," said New Jersey Attorney General Peter Verniero, a Republican. "For all the critics, it's easy to do what they have done over the last 50 years, which is nothing," said Arizona Attorney General Grant Woods, a Republican. "Congress has had the ability to do something for the last 50 years, so go to it."
- The nation's attorneys general have agreed to lobby Congress in support of a landmark settlement with tobacco companies. Michael Moore, Mississippi's attorney general, said Tuesday he won promises from his colleagues attending the National Association of Attorneys General meeting to ask their congressional representatives for quick approval. Some attorneys general want to change elements of the $368 billion deal reached last week, but they still backed the concept.
- Hatch scheduled a hearing for Thursday to hear from participants in the talks, including Attorney General Michael Moore of Mississippi, from tobacco company executives, and from Matt Myers, the only representative of a public health group to participate in the negotiations. Hatch said that his one day hearing "will help Congress and the public" find out more about the accord, which would redefine how tobacco is marketed and regulated in the United States, and provide billions of dollars in compensation to states for smoking-related health costs. "This will be the start, hearing number one," Hatch said. "There will be many, many more" when Congress returns next month from its Fourth of July recess.
- Suddenly, the nation's capital has a new summer sport: deciding the fate of Big Tobacco. It is a perfect pastime, featuring cartons of complex but potentially explosive details and truckloads of money. The White House is in the game. The American Heart Association is, too. And so are teams of federal bureaucrats, public-health advocates and industry lobbyists charged with analyzing every line of last week's proposed settlement with the tobacco industry. In the end, though, the fate of the $368.5 billion package will be decided by a small coterie of high-placed people in the Clinton administration, Congress and dueling interest groups. These few players are likely to dominate debate on the tobacco settlement, both in public and behind the scenes. Here's who they are, and where things are headed:
- In what could be a significant obstacle to the proposed tobacco settlement, public-health groups closed ranks and vehemently denounced a provision they said would cripple the U.S. Food and Drug Administration's ability to regulate nicotine.
- Bill Novelli, president of Campaign for Tobacco-Free Kids, commended the settlement between industry lawyers and state attorneys general as providing valuable new tobacco-control weapons for "fundamental positive change on a large scale." He feared, Novelli said, that the committee wasn't being realistic about Washington politics and was writing a "utopian" policy that would destroy the gains already proposed.
- With a swiftness exceeding expectations, the battle over the tobacco megadeal Wednesday lapsed into trench warfare. . . If restrictions on the FDA are not lifted, "it will be a deal-killer," Kessler said. The deal "has to be fixed, it can be fixed and we will fix it," Koop said. Will the tobacco industry agree? "That's not my problem," he said. "Whether Congress will go along is my problem."
- In a move that could threaten the tobacco settlement, public health groups unanimously declared as "absolutely unacceptable" restrictions that cigarette makers won on government control over nicotine. . . The health panel also declared Wednesday that the deal's penalties for tobacco companies that sell cigarettes to minors are too low to deter the illegal sales. The penalties are to kick in if tobacco consumption among teen-agers is not reduced. The provision is "woefully inadequate," Koop said.
- The health groups' unanimity was striking after a split had emerged in recent weeks. Several groups that had endorsed the general thrust of the settlement talks, including the American Heart Association, the American Medical Association (AMA) and the American Cancer Society, said they could not accept the FDA language in the proposal.
- "The FDA is the core of it all," Randolph Smoak, secretary-treasurer of the AMA, told Reuters. "It has to be tied down so there is no wiggle room or loopholes for the industry." . . . Even Bill Novelli, a representative of the Campaign for Tobacco Free Kids, which helped negotiate the deal, concurred that getting full recognition for the FDA authority was "non-negotiable." But he cautioned other panel members to be realistic about other aspects of the accord, and not be too hasty about rejecting its public health components.
- Nicotine in cigarettes has become the measure of whether the agreement would force the tobacco industry to radically change, or allow it to continue doing business with only slight modifications. Some say failure to resolve the nicotine issue could sink the agreement. The White House is reviewing the accord before it is sent to Congress - with the nicotine provision first on its list of possible changes, sources say. But tobacco firms already are on record opposing further concessions on their part."Who wins the end game on selling tobacco products in the US depends on who wins on nicotine," said Gregory Connolly, director of the Massachusetts Tobacco Control Program.
- Under a clause in the deal - which requires the industry to pay $368.5 billion over 25 years - the industry's entire cost would be counted as "normal and necessary" business expenses rather than a penalty or fine. That means, if Congress does not change the provision, the entire amount would be tax deductible, at the rate of about 40 percent between state and federal taxes, the experts said. "If it were not in there, the argument could be made that the entire thing is a fine or penalty, which would be nondeductible," said Bill Fleming, an executive and tax expert with Coopers & Lybrand in Hartford. If it is considered deductible, however, the cigarette companies would save $147 billion of the deal's cost.
- Just hours after the settlement was announced Friday, SmithKline Beecham fired off a press release declaring itself "the leader in over-the-counter stop-smoking therapies" with its NicoDerm CQ patches and Nicorette gum and boasting about its partnership with the American Cancer Society. But some doctors fear the settlement proposal could end up encouraging anyone who sells a cessation program to jump in. "There's going to be people saying, bring us your $600 coupon for our hypnosis treatment," says William Black, an oncologist in Salisbury, N.C. "Unfortunately, nicotine is very addictive," he says. "I would much rather spend the money on children to not smoke in the first place."
- While the proposed settlement quantifies the upfront and future cash outlays for the tobacco industry, a final settlement agreement requires the approval of several groups, including Congress and the White House, which could result in more stringent terms. In the meantime, the industry remains vulnerable to litigation risk with the Broin class action case underway and the Mississippi and Florida attorney general cases scheduled to begin shortly. However, it is unlikely that any of these cases will be finally decided before a comprehensive settlement is either reached or abandoned.
- B.A.T chief executive Martin Broughton told [The Financial Times] the pact would not achieve drastic cuts in teenage smoking and described the targets for reductions as "unrealistic." "My expectation is that we will fail to meet them," he said. . . "You must remember that this whole deal is not something we agree with . . . We don't support a lot of things that are in this package. But it is a package we are prepared to support overall in order to get a deal."
- 06/25/97 PHILIP MORRIS Board Endorses Settlement--with Reservations Reuters
- The directors said the settlement contains regulatory and legislative provisions with which they disagree. . . . "We hope that these proposals will usher in a new era of cooperation and tolerance with regard to tobacco issues, and we are grateful for the hard work of all the participants in the negotiations that has brought this proposal before the nation," the directors said.
- "They didn't want to give Liggett an advantage in pricing," said Motley. "This was a financial decision about not allowing Liggett to get a price advantage because their cigarettes would be a choice for kids if they cost less."
- "The shameful and outrageous result of your actions is that the very companies that you claim have misled the American public -- that only now have come kicking and screaming to the settlement table -- would see their stock prices skyrocket and their executives enriched, while Liggett, the company that got them to the table, would be ruined. You may not care, but we do not believe that Congress, the White House or the American public will countenance this result," LeBow wrote.
- 06/25/97 LEBOW Sends Letter to AGs Brooke PR
- Under a formula agreed to by the five tobacco companies taking part in the proposal, the first $10 billion payment will be divided based on their stock market value. Under the plan, which was a heated topic of discussion among companies during the talks, Philip Morris will pay $6.5 billion of the initial payment and maybe more, people inside and outside the company said. The subsequent annual payments under the settlement, which will start at $8.5 billion and grow to $15 billion, will be divided based on each company's share of the cigarette market in the United States.
- 06/25/97 RJR Gets Good News on Down Payment Winston-Salem Journal
- 06/24/97 RJR's Small Share of Upfront Tab a "Shocker"--Analysts Estimates had been $2.5B, not $600M. Reuters
- RJR Nabisco has been "a very leveraged company," said Merrill Lynch analyst Allan Kaplan, who called the disclosure in a U.S. Securities and Exchange Commission filing "a shocker." "People were concerned about how they would be able to borrow another $2.5 billion to pay this upfront payment. Now, suddenly, all they have to pay is $600 million." Smith Barney analyst Martin Feldman elaborated, saying, "I think the upfront payment was really a private agreement between the tobacco companies. I think, in reality, it was based on what each company can afford."
- In a filing with the Securities and Exchange Commission, RJR said it believes implementation of the tobacco agreement would "increase the costs and reduce the consumption of (R.J. Reynolds Tobacco Co's) tobacco products in the United States. The company warned that this "could have a significant negative effect on the business of (R.J. Reynolds) and the stated financial position" of RJR Nabisco Inc and the tobacco unit.
- "The company believes that implementation of the proposal would materially adversely affect its consolidated results of operations and financial position," Loews said in a Securities and Exchange Commission filing made Tuesday.
- There are subtle signs that Burnett may be thinking ahead. It already has downplayed the Marlboro Man--banned under the proposal--in some of its advertising and is relying more on its distinctive colors and Western imagery.
- "The rules aren't as restrictive as they sound," said Richard Gerstman, president of Gerstman & Meyers, a brand-identity consultant in Manhattan. "It's somewhat naive to think that taking away the Marlboro Man and Joe Camel will solve the problem because there are so many other things that can be done to make positive brand associations."
- Condon said the focus should be on maintaining the existing tobacco allotment program and crop insurance. He also was interested in developing an agreement for tobacco companies to buy American-grown tobacco before foreign leaf. Scott D. Ballin of the National Center for Tobacco-Free Kids, a Washington-based coalition, disagrees with Condon's approach.
- More than three-fifths (63%) of those polled say the agreement would have no effect on their smoking at all. "Nothing is going to stop me from smoking," says Wanda Hamilton, 56, Miami. "If I have to buy contraband cigarettes or roll my own, I will." . . Questions about specific parts of the suggested proposal suggest a more positive view of giving up the habit. If the government were to provide free programs to help them quit - such as nicotine patches or counseling - 65% would be likely to sign up.
- But none of these measures would add up to much if governments decided to really kick their tobacco tax habits and take responsibility for smoking, instead of leaving it to the courts and "fines". How about telling the industry that tobacco will be banned in 25 years? Or for more timid governments why not ban the sale of tobacco to those under 18?
- None of this is intended to suggest that tobacco companies should not be accountable for the products they produce. But no smoker can legitimately claim to be ignorant of the risks inherent in tobacco use. Circumventing the Constitution to enrich states, empower regulators and reward lawyers does more to punish than protect citizens.
- Although the settlement can still be improved before it moves through Congress, it is important that legislators in thrall to the tobacco industry (and its massive campaign contributions) not be allowed to exploit the disagreements and scuttle the deal. . . Now, well-meaning health advocates and tobacco antagonists are complaining that the deal doesn't hurt Big Tobacco enough. While critics dither, 3,000 young people a day start to smoke - about a million new smokers a year. A third of them will die before their time. The burden is on Congress to stop the mounting toll.
- But the urge to punish an industry that for three generations has had a respected place in American life doesn't set well. It flies in the face of the fundamental American value of individual responsibility. And it can't help but make nervous those who may be wondering if their products might be the target of some future inquisition.
- But once again -- as they have done with the issues of television violence and Internet smut -- American politicians have been content to focus on image rather than reality. This deal may look good from a distance, but as the old cliché goes, it is based on smoke and mirrors. Get rid of nicotine, and Joe Camel will take care of himself.
- This war on multiple fronts forced the tobacco companies to capitulate to stiff terms. But the deal is unholy from the plaintiffs' side. If tobacco is a deadly scourge, why not urge Congress to ban it altogether? . . In effect, tobacco's old adversaries have made themselves its new co-owners. I suspect that the financial and regulatory burdens of this settlement may kill the goose that lays the golden egg. Even if I am wrong, the right approach should have sent the plaintiffs home empty-handed. Labeling requirements can be strengthened. Medicare premiums should be raised for smokers. Tobacco subsidies should be eliminated. The President can rail against smoking. But individual smokers should own up to the consequences of their actions. And the tobacco industry's liability for smoking-related illnesses should be zero.
- Harshbarger likened the agreement to a great vaccine. Maybe, but not in the way he had in mind. In their volatile mix of do-gooderism and political expediency, the state attorneys general may have done more to inoculate Big Tobacco from scrutiny, scorn, and harm than they did to protect children from tobacco. It was a nice try, but no cigarette. Big Tobacco still awaits the wolf that will truly blow its house down.
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2348 responses
- The states and public (36.2%)
- The tobacco industry (43.5%)
- Neither side (12.0%)
- Uncertain (8.3%)
- 06/26/97 Reynolds Wants BROIN Dismissed, Citing Asbestos Case, Says Judge Reuters
- 06/26/97 High Court Upholds Ruling Against Asbestos Settlement Washington Post
- 06/26/97 High Court Upholds Voiding of Asbestos Settlement The New York Times (Free Registration)
- 06/26/97 Is SUPREME COURT Decision a Win for the Little Guy, or a Loss for Courts? The Wall Street Journal (Pay Registration)
- Observers are divided on whether the high court's asbestos ruling will affect the $368.5 billion tobacco settlement. On one side is attorney Motley, who was involved in negotiating both the tobacco settlement and the asbestos settlement; he said the asbestos ruling won't result in any modification of the tobacco pact. . . And, like several others, Motley noted that if a tobacco settlement is enacted, it will be through a law passed by Congress, which wasn't a factor in the asbestos settlement. A statute passed by Congress will trump the procedural objections that the court raised to settlement of class actions. But others think the asbestos ruling could have an impact on the tobacco settlement. Richard Daynard of the Tobacco Products Liability Project at Northeastern University thinks the asbestos ruling could affect provisions of the tobacco agreement that would wipe out future punitive damages and impose stricter procedural rules. The ruling could also affect a separate class-action tobacco settlement reached earlier by Brooke Group Ltd.'s (BGL) Liggett Group, he said.
- In a decision that could increase pressure for a legislative resolution of tobacco claims, the Supreme Court made it harder for massive personal-injury litigation to be resolved through comprehensive court-approved settlements.
- In a defeat for 20 former asbestos companies, the justices upheld a U.S. appeals court ruling that threw out the $1.3 billion settlement because the interests of the various plaintiffs were too diverse and too much in conflict to meet the class-action lawsuit definition under federal court rules. . . Justice Ruth Bader Ginsburg wrote for the majority that the class-action asbestos case failed in several critical respects to satisfy a rule of federal civil procedure concerning a global settlement of current and future claims. . . . However, there are a number of differences between the asbestos case and the tobacco settlement. The case involved a proposed court settlement under federal rules while the tobacco deal would become effective through legislation that Congress must approve and the president must sign.
- A U.S. Supreme Court ruling throwing out an asbestos settlement appeared to reinforce the view that last week's proposed landmark tobacco deal and other large class-action cases should be resolved through Congress, legal experts said.
- 06/26/97 SUPREME COURT: California Fruit Growers Lose Speech Case First Amendment Center. This page also contains links to the texts of the Syllabus, Opinion, and Dissenting Opinions.
- In a defeat for commercial-speech advocates, the Supreme Court today upheld a government program that forced California fruit growers to pay for generic advertising, even if some growers disagree with the message. The 5-4 ruling in Glickman v. Wileman Bros. & Elliott, Inc. dismissed First Amendment arguments that the program amounted to "compelled speech" that has been found unconstitutional in other contexts. The ruling could bolster government efforts to force the tobacco industry to pay for anti-tobacco advertising. Compelled speech of a political nature is unconstitutional, the court said, but advertising for California fruit "cannot be said to engender any crisis of conscience."
- The question now becomes whether this decision is limited to the immediate context of agricultural marketing orders or whether it applies to other commercial products as well. Broad interpretation of this ruling could give weight to government efforts to force the tobacco industry to contribute to anti-smoking campaigns. In his dissent, Justice Souter said that the majority opinion has two disturbing consequences: "Paying for advertising is not speech at all... or compelling payment for third party communications does not implicate speech, and thus the Government would be free to force payment for a whole variety of expressive conduct that it could not restrict."
- Sens. Frank R. Lautenberg and Robert G. Torricelli both sought the positions and were appointed along with 10 others by Senate Minority Leader Tom Daschle, D-S.D. The panel will consist of two factions: Lautenberg will head the anti-tobacco faction, while Sen. Wendell H. Ford, D-Ky., will lead a team representing states that have a large number of tobacco farmers.
- "With an agreement on strong protections to prevent children from smoking, we can get out of the courtroom and get into the business of ensuring our kids grow up to be healthy adults," Beyer said. "I am urging [Virginia's congressional delegation and the White House] to resolve quickly any objections that would prevent this deal from taking effect." Gilmore called the settlement "the beginning of a process" and vowed that as governor he would "protect Virginia's interests." He did not elaborate.
- "It doesn't look too promising to me that, as these smart-aleck attorney generals said . . . 'The Marlboro man will be riding off into the sunset on Joe Camel,' " Fordice said during an impromptu press conference outside his office. "All that's very cute and smart but as far as a few people, including extremely rich and greedy plaintiffs' lawyers, sitting around the room with a bunch of AGs deciding where America's going on the issue of smoking, I don't think that's going to happen."
- Negotiators had left the Marlboro Man's horse behind. The deal would ban cigarette companies from using cartoons or human figures in tobacco advertisements. But it doesn't bar the use of real animals, which are being used to sell anything from Chick-Fil-A sandwiches to Ford Contours. Goodbye, Joe Camel; welcome back, Old Joe ? "It could happen," said Matthew L.Myers, a public-health activist who was in on the settlement talks. "That was specifically discussed and agreed to."
- "Not unlike many smokers who know the dangers of tobacco but got seduced and 'hooked' on the product and cannot quit, the American tobacco farmer and the economic infrastructures of tobacco states are and have been for a long time 'tobacco dependent,' " it said. "In many of these communities tobacco is a way of life, often the only way of life, going back generations." Public health groups "must be willing to recognize and accept our responsibilities in helping to reduce this dependence as part of our overall efforts to reduce tobacco use as a public health matter," the report added. "We must make the tobacco farmer, his family and his community a part of 'the solution' not the problem," it said.
- Indeed, the agreement calls for legally sanctioned price-fixing, explicitly asserting that "in order to promote maximum reduction in youth smoking, the statute would provide for the annual payments to be reflected in the prices manufacturers charge for tobacco products." Analysts estimate that the cost of a pack of cigarettes, currently $1.80 to $2, would rise at least 50 cents and perhaps as much as $1.
- Believed to be high on the list to replace Winston are Coca-Cola, McDonaldıs or one of the food brands from the RJR-Nabisco conglomerate that also owns the Winston brand. For NASCARıs premier series, these types of sponsors could prove to be a step forward from tobacco because they could actively promote the sport through television ads and market directly to young people.
- In the deal to make their legal exposure go away, cigarette companies abandoned positions that farmers and their congressional representatives had long defended for the companies. The $368 billion settlement includes payments for "smoking-cessation aids" but not a penny to help rural communities break their economic addiction to tobacco. . . But what should farmers be demanding from the deal? And who speaks for rural Kentucky? These are not rhetorical questions. Kentucky agriculture faces a crisis of leadership. Against the settlement backdrop, the vacuum stands out like a full moon on a clear night. . . The Kentucky Farm Bureau historically has taken cues from Philip Morris, which now has thrown in with smoking's enemies to protect a company that minimized its dependence on tobacco, through diversification, long ago. . . But can anyone say with any authority what the Kentuckians with the most at stake want from the settlement? We doubt it, but someone should start listening and speaking up. Because you can stand stricken at the crossroads for only so long before becoming road kill.
- President Clinton has promised to make changes in the deal if he believes it does not go far enough. Lifting the cap on penalties and ensuring the FDA can move against nicotine would be two good places to start.
- This settlement was fashioned over months of secret negotiations whose legitimacy is open to question. At last it is out in the open and headed for review in Congress, which is certain to make amendments of its own. At each step, the public will be able to ask questions of its own, of which the leading one should be this: In return for a guarantee of its future financial health, is the tobacco industry sufficiently restrained from assaulting the public health? Today the answer must be: Not yet.
- So we move on to count the fishhooks, or rather, the devils in the details: . . . The relentless Greg Connolly figures that this package might reduce smoking by as much as 20 percent. That's the good news. But it will keep the companies in business for the long run. Bad news. On the one hand, he says, we shouldn't rush into an agreement we'll regret. On the other hand, "We have come too far to throw it all away." The postscript to the pact is going to be long and raucous. Before this new deal is a done deal, we've got to dance with the devils.
- But Clinton's and Trent's in-laws are not the only ones on the tobacco train. Former Texas Gov. Ann Richards and former Senate Majority Leader George Mitchell, card-carrying liberals and now big-time lobbyists for the industry, will be instrumental in getting the deal through Congress.
- [S]omehow it doesn't seem enough. It's a little like finding a Nazi war criminal and making him stand in the corner for an hour as punishment for his sins. . . I've never been particularly receptive to the poor wretches who, after a lifetime of abusing their lungs with predictable results, suddenly realize that they are victims of tobacco companies, so they sue them. . . On the other hand, what am I talking about? Cigarette companies, with great skill and ingenuity, work to hook young people on their addictive product before the youngsters have anything like the judgment that would make such a choice truly voluntary.
- As smoking has been demonized and tabooed, it has naturally become eroticized and seductive. The Internet is rife with sites where cigarette fetishists exchange otherwise mild pornography that depicts men and women lighting up. . . Cigarettes have traditionally served as children's first important introduction to adult pleasures. Adolescents are drawn to cigarettes for all the reasons that our censors are so eager to ban them. They understand them as a way of experimenting with being grown up. They use them as the gateway to the temptations and intensities that adults wish their children would never know, but which the children desire above all. . . . Part of the allure of smoking is the subtle pleasure of elegantly defying death. Thus one doesn't know whether to laugh or cry at the requirement that companies show a decline in teenage smoking over 10 years or face stiff fines. Nowhere does the settlement envisage the possibility that these measures will cause smoking among teenagers to increase even more alarmingly. . . The antismoking crusaders who negotiated the tobacco settlement imagine that it is possible for adolescents to hear only half the truth--that cigarettes are poisonous. Inevitably they will learn the whole truth--that cigarettes are a mixed blessing, as a billion people around the world, lighting up, every day discover to their dismay and satisfaction. America may be the first nation to ban cigarettes. It certainly won't be the first to try. Odds are, however, that as the pendulum swings, the censors once again will learn the absurdity of trying to legislate morality and the futility of aiming to stamp out ancient vices.
- While technically allowing smokers (or their survivors) to continue to sue cigarette companies for damages caused by smoking, the settlement would put a yearly cap of $5 billion on damages--an amount that is a trivial cost of doing business for the industry. This cap will serve as a disincentive to future plaintiffs' attorneys, who will incur enormous costs in any challenges they choose to mount against the wealthy tobacco companies. . . Thus the tobacco deal, by removing the threat of litigation, will bring to a screeching halt many efforts to discourage smoking and curb the outrageous behavior of an industry that is literally selling death. . . o why are we offering special status to the one legal product in the U.S. that is harmful when used as intended? Why, instead, don't we demand that our government take a "hands off" approach to the future of cigarettes? Why don't we let the industry--as any other would--have its day in court and face the consequences of jury decisions? We would thereby let the free market--not the government bureaucracy, not the runaway state attorney generals--determine the future of cigarettes.
- Tobacco companies must publicly admit cigarettes are addictive and deadly if Americans are to accept the proposed tobacco settlement, said senators who are preparing to question cigarette executives under oath. . . How, said Sen. Edward Kennedy, D-Mass., could senators believe that the settlement signals "a new corporate attitude" if attorney Meyer Koplow could not make such a simple admission? . . . If the companies' new executives deny tobacco's dangers, "I think you're going to make the case for this settlement going down the tubes," Biden said.
- Congress started the long and difficult process of trying to turn the $368 billion tobacco settlement into legislation Thursday as the Senate Judiciary Committee held the first of several hearings on the deal. Several other committees from the House and Senate agriculture committees to the House Ways and Means Committee will have a hand in writing the legislation and all of involved committees will hold several hearings on the issue in the coming months.
- Negotiators of the proposed tobacco settlement endured withering criticism from members of the Senate Judiciary Committee in a renewed indication that the deal as crafted faces serious opposition in Congress. . . Senators from both parties warned that the terms of the settlement will have to change significantly. They joined public-health groups in denouncing provisions of the deal they said give Big Tobacco new tools to thwart the Food and Drug Administration's ability to control nicotine content in cigarettes.
- Senators reviewing the new tobacco deal questioned the industry's good faith yesterday when a lawyer from Philip Morris refused to tell them whether cigarettes are addictive.
- Senators vilified tobacco companies Thursday, saying they had practiced deceit and hypocrisy and hurt children, and predicted the proposed tobacco deal would founder in Congress unless cigarette executives admitted their alleged lies. Members of the Senate Judiciary Committee, the first panel to start preliminary hearings on the proposed $368 billion settlement, critiqued the agreement and outlined parts they would like to chang
- A tobacco lawyer drew the ire of senators Thursday when he refused to acknowledge -- despite the industry's proposed settlement last week -- that cigarettes are addictive and deadly. Now Senate Republicans said they will call in the chief executives of top cigarette makers to answer that question . . . The New York attorney who negotiated the tobacco deal for Philip Morris, Meyer Koplow, refused to answer those questions Thursday in the first congressional hearing on the proposed settlement. Koplow said as an outside attorney, he was not authorized to make such statements -- even though he helped write into the deal new warnings for cigarette packs that will say smoking kills. He said tobacco executives would answer those questions for Congress, and Hatch said he planned to call the executives.
- "There's too much to lose if we don't act today." And [Moore] adds, "The option of 50 more years of delay, stalemate, and fighting, while 3,000 kids a day start smoking and 420,000 adults die (annually) from tobacco-related disease, is just unacceptable."
- When Vermont Sen. Patrick Leahy, a Democrat, repeatedly asked if the settlement proposal was a "take it or leave it deal," Koplow said. "We recognize and understand this will go through the legislative process."
- Among the ideas being considered: earmarking $6 billion of the deal to help tobacco farmers switch to new crops, or requiring tobacco companies to use a higher percentage of American-grown leaf in their cigarettes. "There's nothing in this settlement that speaks for farmers," said Larry Wooten, vice president of the North Carolina Farm Bureau. American farmers "are very concerned that this will have a negative impact on companies buying our tobacco." . . . "The point is, the farmers have done nothing wrong. They are playing by the rules and all of a sudden there's a chance their livelihood is threatened," said South Carolina Attorney General Charlie Condon, the only tobacco-state attorney general involved in the settlement talks.
- In negotiations, tobacco opponents insisted that cigarette companies take steps to change a "culture of deceit" in which the industry, often speaking through quasi-independent trade groups such as the Tobacco Institute and the Council for Tobacco Research, maintained for years that tobacco was neither addictive nor harmful. Under the agreement, which must be approved by Congress, the institute and the council would be disbanded, and the tobacco industry could form a new lobbying organization or trade association only under "strict procedures and federal oversight." However, few on either side who have witnessed the industry's resourcefulness at wiggling out of seemingly ironclad concessions are confident that the provisions will have much effect on tobacco's lobbying clout.
- "A critical next step is to bring the proposal back for a careful internal review and to consult with our allies in the public health community," said Lonnie R. Bristow, M.D., former AMA president, who represented member physicians in negotiations with public health advocates and the tobacco industry. "Once this is done, the AMA can make a definitive statement about our support for the agreement," he said. Newton Minow, former chairman of the Federal Communications Commission, will assist the task force through two evaluation meetings, beginning in mid July. Minow also will work with the AMA's board as it determines what position to take on the proposed settlement.
- 06/25/97 AMA Likely to Reject Deal--MINNESOTA Delegate St. Paul Pioneer Press
- AMA rejection could help set the stage for a political war this fall over the settlement, because President Clinton has said he would not sign the settlement unless the AMA and other public health groups support it, said Dr. A. Stuart Hanson, chairman of the Minnesota delegation meeting in Chicago this week. . . . The Minnesota delegation on Monday also introduced its own set of conditions under which it could support the controversial settlement. "We're in heavy politics now," said Hanson, a pulmonary medicine specialist at Park Nicollet Medical Center in St. Louis Park and longtime MMA leader. "This is as big a public health issue. . . . as there's been for many decades," he said.
- "The imprimatur of the AMA is too precious to give out just because a bunch of good old boys made a deal in a back room," said Dr. Albert Blumberg of Baltimore, a delegate at an AMA policy-making meeting. But one of the negotiators of the agreement, former AMA President Dr. Lonnie Bristow, said the AMA shouldn't delay because 3,000 American youngsters start smoking daily. The comments came at a meeting of a seven-member committee that will recommend a position on the tobacco deal to the 475-member AMA House of Delegates, the policy-making body of the 292,000-member medical group.
- Time and again, the tobacco firms rejected entreaties to exempt Liggett from the financial assessments based on market share . . "At every meeting we demanded that, and at every meeting they opposed it," said Moore. "As you can imagine, he has made them very mad." . . The attorneys generals say they had only agreed to use "best efforts" to make sure that the March deal was upheld. Moore still praises LeBow for his "courage" and says the attorneys generals will try to help Liggett in Congress. The company, meanwhile, has hired its own lobbyist to plead its case. The problem for Liggett is that competitors and anti-tobacco forces don't want to see it get a different deal--one that would allow it to sell cigarettes for less than its competitors.
- But don't rewrite the history books just yet. The stunning, 68-page pact reached on June 20 marks the beginning of a new round of bitter, protracted battles. As Congress and the Clinton Administration ponder the details and test the political winds, two questions are emerging: Can the deal be improved? And how much tinkering can it withstand before it falls apart?
- "I'm the luckiest person in the world, because I don't have to have a position on anything anymore."
- The pact is only a broad-strokes agreement that could--repeat, could--lead to a decent deal once it has gone through the Washington legislative mill. There's the rub. We need to see the political fine print. . . But public health, not money, must be the focus. That's why there's no need to rush to settlement. This deal must work for society, not just special interests. To this end, it should stop the relentless marketing of cigarettes to children.
- Now that the full text of the tobacco deal is circulating, its most glaring defects look even worse than they first appeared. That does not mean the proposed settlement is not a historic achievement. . . There is much to admire in the deal. But the nation should not relinquish the threat of state and class-action litigation without insuring that strong regulatory powers and stiff penalties for nonperformance are in place.
- To be consistent with their crusade against cigarettes, the health police have to go after alcohol. The most recent calculations by the Centers for Disease Control and Prevention place the number of alcohol-related deaths in the United States each year at 108,000. That's fewer than the 419,000 deaths attributed to smoking, but there's a big difference: While cigarettes kill in middle age or later, alcohol kills people in their prime, often in car crashes. As a result, the CDC estimates that smoking deprives Americans of 1.2 million years of life before age 65; alcohol, 1.5 million years.
- ANNA MARIE STOLLEY talked to teenagers about smoking, the impact of the settlement and the state's recent anti-smoking advertising campaign directed at youths.
- After years of taking aim at the tobacco Goliath, public-health researchers have a pretty good idea how to curb smoking. Unfortunately, lawyers don't. . . . For proof, look at how the stock market has embraced the deal. Investors have bid up tobacco shares, assuming the industry will continue to thrive. That is a sign that the deal is bad for public health.
- Only in America can a struggling public defender and failed politician like Hugh Rodham Jr. become a multimillionaire overnight. The brother of Hillary Clinton has just won America's next best thing to the lottery: a lawsuit.
- The proposed settlement between Big Tobacco and Big Government epitomizes the new statism. It has been called the nanny state, but that is far too kind a term. It is too cold, too cruel, too implacable, too illiberal to be a nanny. It is the Nurse Ratched state
- CLEVER TEXT ADS. RIGHT NOW WINSTON IS RUNNING ONE THAT SAYS: "Until I find a real man, I'll settle for a real smoke." With a line like that, who needs pictures? -- Logo ads. Cultural critic Marshall Blonsky says tobacco companies are probably looking closely at Nike, whose swoosh logo is a metaphor for vitality, exuberance and control.
- With that in mind, this whole thing may yet be watered down by the money-corrupted Congress or scuttled by Bill "Am I Great Yet?" Clinton. Either way, we should seize on this opportunity to reflect on cigarettes, because they open a door to a wide range of issues, from the individual decisions people make when constructing their lives, to the great questions of what a government should do for its citizens. Like many non-smokers, my first instinct is to dismiss the habit as merely stupid. I'll confess that my initial reaction, glimpsing a smoker, is the same as seeing a woman who is wearing that Jennifer Aniston hairdo: "Oh look, a stupid person." But this is overly harsh. . . There must be some kind of powerful force at work, call it need, addiction, habit or whatever. Given this need, is it right for the government to try to stop it? The Milton Friedman answer is that they shouldn't. Philip Morris should be able to use Barney to hawk cigarettes--or heroin, for that matter--with the burden placed on individuals to monitor themselves and their children and decide which addictions to embrace or avoid.
- But we hope that Congress doesn't make public confession the condition on which its endorsement of the tobacco agreement depends. In its basic framework the deal is simply too vital to be held hostage to that demand. Congress should instead work to strengthen the agreement . . . Two areas in particular need toughening. First, no restrictions should be accepted on the Food and Drug Administration's authority to move swiftly to regulate nicotine. . . Congress should also remove from the deal provisions allowing the tobacco companies to finance their settlement payments by treating them as "ordinary and necessary business expenses," which means in effect that taxpayers will be subsidizing the payouts.
- And before legislation based on the agreements can weather Congress, they will have to get past senators, including Kentucky's own and the Senate Majority Leader Trent Lott, who can smell tobacco money farther than he can scent tobacco smoke. Tobacco money, like money in general, is still a powerful force in Washington, and the tobacco lobby has always had a good supply on hand, ready to help those who help the industry. Better delay the victory parade.
- When cigarette manufacturers reached their landmark settlement with the attorneys general of 40 states, they tried to throw just the right number of passengers to the wolves - making just enough concessions to gain the safety of legislative immunity from liability suits. . . In just a few days, the tobacco settlement has undergone intense scrutiny by all the official, quasi-official, nongovernmental and public-interest groups that the nation can muster. Their nearly unanimous conclusion is that more should have been squeezed out of the tobacco companies. That's the judgment of the market, also. . . When we endorsed the state suits last year, they seemed to offer the best chance of including the external costs of tobacco consumption in the price of tobacco products. . . We hoped the court system could be more judicious. We were wrong. . . The attorneys general negotiated a settlement that put them in business with the tobacco companies rather than driving the companies out of business. . . It's a tribute to the skill of their lawyers that the tobacco companies kept so much in the first round of negotiations. But tobacco's adversaries, like the wolves in the Russian forest, are omnipresent and insatiable.
- Contrary to Mr. Epstein, far from immunizing the industry from liability, the Cipollone decision specifically upheld the power of plaintiffs to sue tobacco companies for fraud, breach of warranty and conspiracy, and even failure to warn, so long as the plaintiffs do not directly challenge the adequacy of the Federal label.
- Over the subsequent three months BAT's shares climbed more than 20% to touch nearly 600p as investors piled in, hoping a positive settlement would trigger a more long-term re-rating. But since last Monday, when the market had its first opportunity to digest the terms of the deal, the shares have fallen from 589p to 541 1/2 p, wiping £1.2 billion from BAT's market value. Many analysts fear the settlement has created confusion rather than the certainty anticipated by investors. . . While a tobacco settlement would free up the board's time to concentrate on strategy, [Broughton] says a demerger is not the only option, adding that he is not in a rush and that BAT can meet its first $1.7 billion payment under the deal out of unused bank facilities. But investor pressure to push forward with a break-up will not go away.
- The panel, representing 23 public-health groups, is insisting that the deal be strengthened in seven areas, including Food and Drug Administration jurisdiction over tobacco products, disclosure of industry documents and the right to sue cigarette makers for punitive damages.
- "A global tobacco settlement is premature and wrong," said Eleanor Garrett, president of the American Lung Association of Virginia. The Virginia Thoracic Society, a 145-member physicians' group, also opposed the deal that was announced June 20. The health groups, meeting at The Jefferson Hotel in Richmond, adopted a joint resolution stating "no immunity should be provided the tobacco industry or tobacco industry executives."
- "My preliminary take is that we do not want to paralyze the capacity of the FDA to protect the American public. And that, to me, is the critical thing," the president said.
- Clinton said he considers the recent agreement between tobacco foes and cigarette companies "a terrific achievement," even as he worries it may "paralyze the capacity" of the Food and Drug Administration to regulate nicotine and "protect the American people." Last Sunday, Clinton pledged to complete his review within 30 days. But White House aides, noting Clinton's ambivalent feelings and the technical complexity of the issues, made clear that is a goal, and the decision could easily be delayed into early August.
- We have a team within the Administration of experts who will be looking at all the various elements of the settlement. We will widen that net, too, to include half a dozen [federal] agencies and several White House offices. We want to cast as broad a net as possible. Q: Does that net include tobacco industry officials or lobbyists such as former Texas Governor Ann Richards? A: I have not had any conversations with tobacco representatives, apart from briefings with negotiators along the way. The industry views are reflected in the settlement. We've turned it over to the rest of the world to look it over.
- Shalala says several agencies, including the National Institutes of Health, Centers for Disease Control and the Food and Drug Administration, will contribute to the review.
- tobacco deal: President Clinton says (Friday) that despite admitting he was "immensely impressed" with the state attorneys general who negotiated the liability agreement with the tobacco industry, he still remained far from deciding whether to endorse the deal.
- The White House plans to announce Friday four working groups. They will focus on: Food and Drug Administration jurisdiction, children's and public health, legal issues and industry accountability. But Clinton's goal of a 30-day review could slip. White House officials consider former FDA chief Kessler's views vital, but his ubiquitous presence on television irritates some. A panel led by Kessler and former surgeon general C. Everett Koop will send its critique of the deal to the White House and Congress next week
- Although lawmakers typically act sooner rather than later when they can discern the contours of public opinion on high-profile issues, the risks of rushing to stake out firm positions on tobacco appear to outweigh the benefits. "The nature of the settlement is beyond most Americans' ability to comprehend," said Robert J. Blendon, a professor of health policy at Harvard University. "The average John Q. Public is waiting for credible groups, like the American Heart Assn. or the American Lung Assn., to tell him whether it's a good deal or a bad deal." So are lawmakers.
- Convenience stores, left out of negotiations in Washington, are preparing to challenge the proposed settlement out between tobacco companies and the states. Lindsay Hutter, spokeswoman for the National Association of Convenience Stores, said her members support the goal of reducing youth access to tobacco. She said, though, the new regulations will impair their ability to sell tobacco products. What's at stake is nothing to be sneezed at - tobacco sales nationally amount to $17.3 billion a year for convenience stores, more than a quarter of all their sales excluding gasoline. Hutter's organization is lobbying Congress to enact a different regulatory scheme. If the group is successful, it could blow apart the entire package . .
- The only thing six Oklahoma smokers have had to do so far is let a group of attorneys put their names on a lawsuit. Nonetheless, they just may become part of history -- the part where the nation's tobacco companies bargain for their future in a $368.5 billion proposed settlement.
- Because successful quitters tend to be more educated and affluent, the anti-smoking campaign would accelerate smoking's evolution in America into a lower-income habit, predicts Neal Benowitz of the University of California-San Francisco, a psychiatrist who specializes in tobacco dependency. He forecasts a future smoking population resembling groups addicted to illegal drugs. Its members would include disproportionate numbers of depressed people, alcoholics, and other psychologically impaired people who, research has shown, find smoking especially hard to quit. Overall, the number of U.S. smokers, now about 45 million, could fall to 10 million to 20 million in a generation, experts estimate.
- But under the terms of the accord, the industry is expected to pass on the costs of the settlement to the very people Gauthier represents, and addicted smokers will see that reflected in the cost of their cigarettes. Prices are expected to rise as much as $1 a pack. . . "It is smokers who will be paying the bill for all this," said Gary Auxier of the National Smokers Alliance, a nonprofit smokers-rights group that claims 3 million members and receives major funding from the tobacco industry. "That tends to get lost in all the rhetoric."
- The historic accord that tobacco companies and state officials brandished after months of intense negotiations looks less like the last word and more like an opening bid, legal experts and anti-smoking activists say. The next round of negotiations is already underway. At this point, it is an indirect affair involving health groups, the industry, the White House and state officials all vying to shape the opinion of the public and of Congress.
- In their rush to snuff out cigarettes, the zealots have crushed free expression. Don't forget: The free market depends not only on a free flow of goods and services, but on a free flow of ideas, no matter how unpopular or distasteful they may be. Cigarette smoking may be hazardous to our health. But this cigarette settlement is even more threatening.
- [American Advertising Federation president Wally] Snyder said he wasn't proposing the industry abandon its so-far-successful challenge of FDA tobacco-advertising regulations . . Instead, he drew a distinction between rules imposed by government and any new laws to implement a voluntary industry agreement to limit its advertising and marketing. Other ad groups are in sharp disagreement, especially following the news that two influential U.S. senators questioned whether alcoholic beverages should not face similar ad restrictions.
- The deal will save lives; The deal is a gift to tobacco companies; The deal is the best that can be done; Why should antitobacco crusaders quit when they are just starting to win?
- "What we are proposing," said Mississippi Attorney General Michael Moore, "is that the negotiators for the tobacco industry demonstrate their good faith and remorse for having profited at the expense of the damaged health and well-being of Americans for decades by killing themselves."
- "But on closer inspection the proposal is full of loopholes," the Lancet said in an editorial. "The pact as written is clearly not acceptable," it added. "It is unlikely that the agreement, if it is approved by Congress and the president, will significantly reduce tobacco-related death and disease in the USA."
- Each year into perpetuity, the tobacco industry could be writing a check of $40 million to $60 million to the state of Hawaii. . . State Attorney General Margery Bronster yesterday said the estimate of Hawaii's share is based on discussions she had with other state attorneys general
- Rep. Virgil H. Goode Jr., flanked by farmers complaining they had no say in the proposed tobacco agreement, promised yesterday to represent their interests during congressional deliberations about the settlement. Goode, D-5th, met with members of the Concerned Friends of Tobacco yesterday to discuss the farmers' concerns. . . . J.T. Davis, a member of the Concerned Friends' board of directors, said the group has prepared a packet outlining the contributions that tobacco growers make to their community and the economy. Information in the packet also debunks some of the myths surrounding the leaf. The packet is titled "American Tobacco Growners: Most Misunderstood Group in America."
- Philip Morris CEO Geoffrey Bible, the last of the tough-talking tobacco chieftains, has done what was long unthinkable: He negotiated a settlement with tobacco's enemies. What finally brought him to the table? And how will he--and his company--survive tobacco's new and uncertain future?
- So, while it's important to consider what a life is worth, it's equally important not to be ruled by the numbers. We should allow ourselves a little irrationality, a little tug on the heart now and then.
- It was the plaintiffs lawyers--men like Ronald Motley and Richard Scruggs, who agreed to join forces with the states, for a contingency fee, no less--who ultimately forced the tobacco industry to the table. "The attorneys general are not equipped to bring the kind of pressure that plaintiffs lawyers bring as a matter of course," says New York University law professor Stephen Gillers. "It was plaintiffs lawyers who cornered this industry." . . "There's a whole corporate world waiting to be ravaged by the plaintiffs bar, and it'll be funded by the money from the tobacco industry," says Paine Webber analyst Emanuel Goldman. That seems wildly overstated. Still, even if you believe that the tobacco companies are getting what they deserve, the triumph of the plaintiffs bar is worrisome . . .
- Staff for Sen. Frank Lautenberg, a New Jersey Democrat, have begun outlining a bill that would closely resemble the conclusions of the tobacco-policy task force led by David Kessler . . and C. Everett Koop . . Sen. Lautenberg's staff hopes to enlist a slate of co-sponsors and complete the legislation before the August congressional recess. By moving quickly against the settlement . . Sen. Lautenberg and his allies foreshadowed the likely intensity of the coming fight over efforts to move some version of the agreement through Congress.
- The deal, which would impose limits on cigarette manufacturers' ability to advertise their products and on smokers' ability to sue for damages, might well violate the 5th Amendment guarantee of due process and the 10th Amendment, which says the states have any powers not given to the federal government under the Constitution, legal experts said. "Nobody knows for sure, because it (the accord) hasn't been contested," said Clifford Douglas of Evanston, a tobacco litigator. "But it's as sure as the sunrise that (court) challenges will be made."
- "More than $360 billion will change hands," said University of Texas law professor Samuel Issacharoff, who studies legal fees. "Anybody who has an active involvement is going to get a piece of that money." With so much at stake and the formula for distributing the fees still undecided, rival groups of lawyers involved in the deal already have begun jockeying for the fees. And the potential lawyers' payments have become a favorite target of those criticizing the proposed deal,
- The Allen administration, which has sided with the tobacco industry, plays catch-up in seeking to protect the state's major cash crop in pending deliberations over the proposed $368-billion settlement with cigarette companies.
- Casting himself and other Virginia Republicans as defenders of threatened tobacco farmers and cigarette industry workers, Gov. George Allen today urged Congress to try to soften the impact of the landmark tobacco settlement on Virginia and other states that grow the crop. At a news conference with 9-year-old Jessica Wells and her parents, tobacco farmers from Mecklenburg, Va., Allen announced that he had created a panel to advise Virginia's members of Congress on possible compensation for farmers and workers who could be affected by last month's $368 billion settlement . . "My concern is that families such as the Wellses and literally tens of thousands like them across Virginia are . . . being ignored . . I'm just trying to find some way for them to understand that, look, these are real human beings . . . being affected by what you might be doing."
- Virginia, one of only 10 states that shunned negotiations with tobacco companies, is trying to get back in the game by demanding its share of the settlement money and lobbying Congress to add relief for farmers. State Attorney General Richard Cullen (R) contends Virginia has "maximum leverage" because the states involved in the negotiations will need the support of tobacco-belt congressmen to win ratification of the agreement. "Tactically speaking, it was a stroke of genius for Virginia not to be a signatory to any settlement," Cullen said. "If we had been a signatory, our role would be to swallow it. Now, our role is to get Congress to improve upon it."
- The economics of tobacco are so unbelievable that the industry was able to grossly overpay to buy itself peace, underwrite real advances for public health and emerge with its killer instinct for profit satisfied. In an imperfect world, the recent settlement is a win for both sides. . . But if sports can sell a $150 rubber shoe, it can sell a pack of smokes. Ending the tie-ins is a good idea.
- We now have government by and for the lawyers. The proposed cigarette settlement, if adopted by Congress, represents a stunning shakedown of a major industry by a small group of private attorneys . . . How they hijacked the public policy process for private enrichment is the little-told story of the tobacco settlement. . . The settlement mainly reflects private greed and political ambition . . Congress ought to substitute public health policy for open-ended litigation as a way of dealing with smoking. It can regulate future liability suits; whether it could erase existing suits is a hazy legal and political issue. If it can't, let the suits proceed. Let the lawyers take their risks and, if possible, earn their immense fees.
- None of these measures alone has proven an effective smoking curb, but many experts see promise in their sudden, dramatic, combined application. "We could change the norms, change the culture," said Benowitz, the San Diego tobacco addiction specialist, "with a combination of little things that turn out to be effective together."
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