Maryland AG Urges Changes in Proposed Tobacco Settlement

BALTIMORE—The $368.5 billion settlement worked out between 40 state attorneys general and the tobacco industry now faces the lengthy congressional process. Congress must enact and the President must sign into law a number of provisions to finalize the agreement.

President Clinton, a number of anti-smoking advocacy groups, and several attorneys general have suggested major changes in the agreement. As the House and Senate prepared for hearings, Patrick Young, Oncology News International’s Washington Bureau Chief, discussed the proposed settlement with Maryland Attorney General J. Joseph Curran, Jr., LLB.

ONI: Have the attorneys general involved in the lawsuit discussed taking a united stand on the legislation?

Mr. Curran: No. Conceptually, all of us would welcome a settlement. The big issue, of course, is in the details. There are those who are pushing for the original proposed resolution, and there are several of us who would like to see some changes. The President has come out strongly for some of the changes I support, and that is encouraging.

ONI: Do you agree with the President’s suggested changes?

MR. CURRAN: If he means that the FDA should have authority to control nicotine in the cigarette delivery device, then I support the President. The FDA must have unfettered control to regulate nicotine as a drug. I think that is the position we should take and where we should draw a line in the sand.

ONI: If the FDA is excluded from regulating nicotine when the legislation is drafted, do you think Congress will pass it?

MR. CURRAN: I would think Congress would not pass that; at least I would certainly hope they wouldn’t.

ONI: What other changes do you see as necessary?

MR. CURRAN: I would like to see the tobacco industry, up front and during the congressional hearings, make full and complete disclosure of their research and their files. That would permit the American public to understand completely what our case is all about, which is the companies’ failure to disclose information when they knew it and when it could have made a difference.

I would also like to ensure that, a decade from now, a Maryland citizen will have the same tort opportunity in court that he or she has now. I would not like to see the tobacco industry be given some special consideration—elimination of punitive damages or limitation of the possibility of class actions. I very definitely think it is wrong to require that there not be any consolidation of cases. That almost amounts to implied immunity from lawsuits.

The present draft would not allow future plaintiffs to join their claims with those of other plaintiffs. Each individual case would have to be taken before an individual judge in an individual trial. As a practical matter, we have 134 circuit court judges in Maryland at the trial level. We have about a million smokers, of whom about 7,500 die every year. Just assuming only a very small fraction of that number would choose to file suit to recover damages, you see the impossibility of trying those cases unless they are consolidated or lumped as a class.

The sheer numbers would make it almost impossible for most people to ever get their case to court. The cost is astronomical, $300,000 to $400,000 each. Many of these folks would be seniors or ill, with limited time on Earth, and it would be most unfair to make them have to file an individual suit and wait until such time when there is an available judge. It is absolutely wrong.

ONI: Should this settlement fail to win legal sanction—because Congress fails to pass it or the President vetoes it—what do you see as the future then?

MR. CURRAN: We would go on with our suit, and we are prepared to win in the court. We have our lawyers; we have our discovery. We are getting more and more information from other states as they proceed with their trials.

We are prepared to go before a jury in Baltimore in January 1999, and we would hope to prevail on the issues of damages to the state, recovery of our Medicaid costs, and the antitrust implications, which would permit us to get triple damages. I can see getting substantial damages, if we can prove there was deception in the marketing of cigarettes.

ONI: You make the trial route sound almost appealing to a citizen. Is a settlement really in the interest of the states over going to trial?

MR. CURRAN: The settlement could do more in terms of injunctive relief, and in terms of funding the antismoking efforts of the Department of Health and Human Services and counteradvertising programs. Our suit would be able to limit marketing to kids and to clean up improper advertising and misleading advertising, but the global settlement really does have some good features in terms of the future health of Americans.

ONI: Why are the tobacco companies interested in a settlement?

MR. CURRAN: I think they would like to have peace. They see there are 38 state cases now pending. They are spending somewhere around $6 million or $7 million a year on legal fees. They see that each day there is a new potential lawsuit by some consumer. I don’t think they want the information in their files brought out for the public to see. Some CEOs really have a serious problem with the testimony they have given, and they would like for this all to go away. They feel they can throw $368 billion on the table and everybody will run for cover.

ONI: What is the likelihood that the tobacco industry will actually reject the settlement if changes are made in it?

MR. CURRAN: It is hard for me to imagine why they would reject a settlement if it gives them peace, even though it means the FDA can regulate their product. They should be able to live with that. The FDA certainly can’t eliminate nicotine products overnight. It will take a few years to work down the nicotine level. By that time, the companies may well be able to develop some other kinds of products to market.

ONI: Overall, do you regard this settlement as being in the best interest of the nation’s public health?

MR. CURRAN: If we deal with the issues of FDA authority, full disclosure of the information in the company files, and not limiting the rights of people to sue in the future, then I think it is in the public’s interest. We will be able to reduce teenage smoking and get a lot of money for counteradvertising and maybe one day not have the horrific 400,000 plus citizens die each year from smoking-related illnesses.

ONI: The settlement of $368.5 billion seems quite substantial, but split among 40 states over 25 years, does it really compensate the states adequately for the smoking-related health costs they have endured?

MR. CURRAN: As a practical matter, the settlement would probably come close to paying us for the Medicaid expenses we have incurred over the last 30 years. However, it wouldn’t pay us a dime for future costs, and it doesn’t give a single smoker anything for his or her injuries. What the industry is doing is paying off a past due bill, but the addiction continues, the illnesses continue, and the settlement does nothing for that.

ONI: Any other points you’d like to make?

MR. CURRAN: I’d like to see consideration in the plan to make it easier for tobacco farmers—of which we have about 1,500 in Maryland—to phase into other programs. I wouldn’t want to see these tobacco farmers, who have for decades been growing a legal product that is readily accepted, left out in the cold.

There also has to be some concern about the incidence of smoking in the rest of the world, particularly Asia and Eastern Europe. I would hate to see us solve the problem in America but then export it to third-world nations, or even industrial nations, and have them continue to be addicted by a product that we don’t have over here. Although it isn’t part of our settlement, I don’t think we should export potential illnesses to Russia and China. That doesn’t seem like the right thing for America to do.