Supreme Court Opens New Fall Season with Big Tobacco Lawsuit Drama

Posted by Enrique on 10.09.2008

Light ‘em up



October 2008 – the U.S. economy remains poised at the brink of collapse. With an election looming less than one month away, an ambivalent American public is fixated on the presidential campaign. As credit markets tighten, and dismal quarterly 401(k) statements are mailed to restive U.S. workers, all patriotic Americans desperately hope for some faint sign that either Barack Obama or John McCain is capable of leading us to a prosperous future. The housing bubble has burst, faith in free markets has crumbled, and the government continues to accumulate debt almost as rapidly as it accumulates power. It is a dark time for the republic.

So let's forget about all that and turn now to the U.S. Supreme Court, whose new term began this week. On the first day of arguments, the SCOTUS turned to the next chapter in the familiar book of Tobacco Company Litigation. In Altria Group v. Good, the Supremes listened as Phillip Morris attempted to snuff out another lawsuit against the beloved cigarette merchant. Phillip Morris' position is essentially, "Dude, seriously – stop suing us. It's out of hand. Just stop. Please."

You're not going to believe this, but the Supremes sound like they might actually side with Big Tobacco on this one. We can only hope – a pack of cigarettes is up to $5.00 in Wisconsin, and I NEED A BAILOUT.

The story so far…

In Altria Group v. Good, the issue is whether or not Big Tobacco is legally permitted to sell "light" cigarettes. A group of Maine smokers sued Phillip Morris, claiming they were fooled into believing light cigarettes weren't harmful, and now they want a seven-figure refund.

Stephanie Good, a Bangor resident who reports smoking one pack of Marlboro Lights every two or three days, joined two others in suing [Phillip Morris' parent] Altria under a state law that prohibits "deceptive acts or practices." The smokers contend Marlboro Lights advertising tricked consumers into thinking "low tar and nicotine" cigarettes are less harmful than conventional cigarettes.

The Maine residents say the tobacco company knew smokers would compensate for the low tar and nicotine by drawing more deeply on the "light" cigarettes and thereby inhale a full complement of the dangerous and addictive chemicals.

One pack every two or three days? Christ, is Ms. Good in high school? Anyone who smokes less than a pack a day isn't demonstrating a serious commitment, so I'm skeptical Ms. Good is sufficiently aggrieved. I'm also skeptical anyone living in America over the last thirty years could be blissfully unaware that smoking light cigarettes is at least somewhat harmful. In fact, the pack of Marlboro Ultra Lights I'm holding in my hand right now says, "quitting smoking now greatly reduces serious risks to [my] health."

It may be true that smokers of light cigarettes puff more by volume, but it also may be true that the market simply wants the option of a less abrasive cigarette. For example, I used to smoke Marlboro reds, but eventually switched to ultra lights because I preferred the smoother taste. For many people, smoking satisfies our innate oral fixation, and the relative "lightness" of the cigarette doesn't necessarily impact the frequency of our fidgety urge for a smoke break. But even if it does for some smokers, it's still nice to have the option of choosing to buy a product I want to buy.

Regardless of Phillip Morris' allegedly devious motives, they argue it's perfectly legal to market cigarettes on the basis of tar and nicotine content, because Federal Trade Commission guidelines require such disclosures. Phillip Morris also cites the 1969 federal Cigarette Labeling and Advertising Act, which forbids state legislatures from creating any "requirement or prohibition based on smoking and health" in advertising. (Apparently the feds wanted to prevent cigarette manufacturers from being sued out of existence, which isn't surprising when you consider the tax revenues Big Tobacco generates. It's a mentholated gold mine.) Phillip Morris claims it was following the law, and that Ms. Good's suit should be thrown out. The conflict, then, is between these federal regulations and Maine's laws about deceptive claims in advertising.

As a result of decades of convoluted jurisprudence regarding Big Tobacco, Ms. Good and her cohorts weren't legally permitted to sue Phillip Morris merely for implying that cigarettes with less nicotine are relatively harmless. Essentially, their claim had to rest on the basis that light cigarettes are of inferior quality compared to regular cigarettes. Imagine if General Mills marketed a cereal called Cheerios Bright, with advertising that implied eating them could make you more intelligent – but then they just put regular Cheerios in slightly modified packaging, without altering the recipe. That's the heart of Ms. Good's claim.

For the long version, the entire oral argument in PDF format can be found here. It's chock full of thrilling legal drama, I assure you. Some highlights – at one point, Good's lawyer David C. Frederick found himself having to argue their suit isn't based on concerns over his client's health. It's a completely illogical position, but that's American tort law for you:

JUSTICE SOUTER: Do you think you could recover [damages] if the evidence showed simply that all your clients had the health of Olympic athletes?

MR. FREDERICK: Yes.

JUSTICE SOUTER: You do?

MR. FREDERICK: Yes, I do, because our damages here, Justice Souter—

JUSTICE SOUTER: What would the harm be, sort of aesthetic? (E note: That's pretty funny for Souter, usually he's an insufferable twerp.)

MR. FREDERICK: If we bought a product thinking that it would be a safer product and it was not, and we would have quit smoking.

JUSTICE SOUTER: If they are healthy as horses, you have no proof that it is not.

MR. FREDERICK: We're -- yes, we do, because the product is different. If you buy a car thinking it's a Ford and it's a Yugo but it still drives, you still have a claim under the lemon laws for deceptive advertising.

JUSTICE SCALIA: But what if Yugos and Fords are worth the same amount of money?

MR. FREDERICK: That is an economic proof—

JUSTICE SCALIA: But that's the thing here. Unless you show that for some -- for some reason -- were light cigarettes sold as a premium? Did they charge more for light cigarettes?

MR. FREDERICK: There is economic evidence, Justice Scalia, of a difference in value, and of course the pre-emption -- the issue here is not—

JUSTICE SCALIA: Answer my question. Did they charge more for light cigarettes?

MR. FREDERICK: They did not charge more for light cigarettes.

JUSTICE KENNEDY: So what are your damages? (p. 30-31)

Bizarre – Washington DC seems like a different planet sometimes. You have to feel sorry for Frederick being compelled to make such a silly argument, even if he is a trial lawyer. I can't imagine how nerve-wracking it must be to argue before the Supremes, especially when the justices are basically trying to bait you into saying something stupid. Anyone who struggles with public speaking can sympathize with Mr. Frederick's predicament, especially when it goes horribly wrong:

CHIEF JUSTICE ROBERTS: Mr. Frederick, did I understand you earlier to say that your complaint did not seek injunctive relief?

MR. FREDERICK: We are not here seeking injunctive relief for this—

CHIEF JUSTICE ROBERTS: Page 42A of your amended complaint says you ask the Court to grant such injunctive relief as may be appropriate.

MR. FREDERICK: I misspoke, Mr. Chief Justice, with apologies to the Court.

Ooooooooh. Total humiliation. Roberts might as well have said, "And what's more, Mr. Frederick, I'm told you have a tiny penis." Poor bastard attorney. In any case, Good's suit is in jeopardy because Justice "Swing Vote" Anthony Kennedy appeared unconvinced, saying, "Mr. Frederick, if I take away from your oral argument that it is your position that this suit is not based on a link between smoking and health, I'm going to have difficulty in accepting your position in this entire case." Given that, it looks as if Big Tobacco might be able to scratch out a SCOTUS victory.

That's not necessarily a bad thing, because these ceaseless lawsuits against tobacco companies have some perverse consequences – they allow fiscally irresponsible governments to extort money from private corporations, and they enrich trial lawyers. Any time the federal government or state legislatures need to plug a budget hole, they sue Big Tobacco, and trial lawyers are more than happy to help them out, pocketing huge fees in the process. Meanwhile, Big Tobacco passes on the costs to the cigarette consumer, who is typically economically-disadvantaged. Consequently, tobacco lawsuits act as a mechanism of wealth transfer from relatively poor Americans to relatively wealthy Americans.

If states or the feds wanted to ban the sale and manufacture of cigarettes outright, it's unlikely anyone would stand in their way. Many municipalities already have enacted restrictive smoking bans; banning cigarettes altogether isn't much of a stretch, and it would probably attract substantial public support. But government doesn't want to prohibit smoking, because Big Tobacco is one private industry they can shake down at will without fear of public outcry. Even though the Department of Justice itself has sued Big Tobacco in the past over advertising (unsuccessfully), the above-mentioned 1969 Labeling Act remains on the books to provide cigarette makers with legal cover. Government wants it both ways.

Another upside is that a victory for Phillip Morris is a victory for free expression, in the sense that it would reduce the government's power to regulate corporate speech via advertisement. After all, cigarette makers are still Americans, even with their long history of dishonesty and reckless disregard for the wellbeing of their consumers. If free expression doesn't apply to the scoundrel, then it applies to no one. In a sense, a victory for Phillip Morris' rights is a victory for America. If they end up being successful in Altria v. Good, I say we celebrate by having a fag.

You know what I meant.