Even a Victory Would Be Embarrassing
The trial in the Justice Department's lawsuit against the leading cigarette manufacturers is winding down, with the government's last witness, Matthew Myers of the Campaign for Tobacco-Free Kids, testifying yesterday. Myers was there to outline the differences between the 1997 proposed settlement resolving state lawsuits against the tobacco industry, which fell apart when Congress declined to go along, and the 1998 settlement, which was finalized without congressional approval even though it effectively imposed a national cigarette tax and national restrictions on cigarette advertising and promotion. The New York Times explains some of the ways in which the 1998 agreement was laxer than the 1997 agreement:
For example, the 1998 agreement allows each company to attach a cigarette brand name to one event or series of events, like the Winston Cup auto races. The 1997 agreement would have banned all sponsorships.
The 1998 agreement did not address in-store cigarette advertising. The 1997 agreement would have banned the use of color and set limits on the size and number of signs.
The 1998 agreement allowed free samples to be distributed in adult-only sites. The 1997 agreement banned all free samples.
The point of Myers' testimony was to show there are some additional restrictions that U.S. District Judge Gladys Kessler could impose as remedies for the industry's "racketeering." So this is what the case comes down to, after six years and hundreds of millions of dollars: no more cigarette samples in bars, color-free retail signs, and a new name for a car race. And maybe yet another stop-smoking program. That's assuming the government wins the case and gets everything it's asking for.
No matter what happens now, the Justice Department has suffered a humiliating defeat, which it richly deserves for pursuing a case that had no basis in the law. Even before the trial started, Kessler ruled that the government was not legally authorized to demand that the tobacco companies pay tens of billions of dollars for the cost of treating smoking-related illnesses under Medicare. This year a federal appeals court nixed the Justice Department's attempt to force "disgorgement" of $280 billion in allegedly ill-gotten gains, since no such money grab is permitted by the provisions of the Racketeer Influenced and Corrupt Organizations Act under which the government filed suit. Now the government is reduced to quibbling about the size of Marlboro signs at the 7-Eleven.
