Tobacco Litigation Trials: 1954-present

Plaintiffs: Smokers, their next of kin, and the state and federal governments
Defendants: Philip Morris Company; R.J. Reynolds Tobacco Company; Brown & Williamson Tobacco Corporation; Lorillard Tobacco Corporation; The Liggett Group, Inc.; American Tobacco Company; British American Tobacco, P.L.C.; and other tobacco-related entities
Place: Various
Dates of Trials: 1954-present

SIGNIFICANCE: The tobacco litigation cases represent one of the largest class action movements in legal history; coupled with state and federal action against tobacco companies, the actions reflect a growing condemnation of the tobacco industry that would have been unthinkable until recently, and which may ultimately lead to similar suits against other makers of controversial products.

In the mid-1950s, two decades after university studies began linking smoking to lung disease, smokers began suing tobacco companies on personal-injury grounds. These plaintiffs, most of whom had health problems for which they blamed their smoking habits, based their suits on product liability principles, arguing that tobacco was an inherently dangerous product for which the manufacturer should be held accountable.

The next 30 years saw two waves of unsuccessful tobacco litigation: from the 1950s to the early 1970s, and throughout the 1980s. The plaintiffs in the second wave relied more heavily on the fact that the federal government had begun to speak out against the dangers of smoking. The first major governmental warning was the 1964 Surgeon General's report stating that smoking was a habit-forming health risk. In 1965, the federal government began requiring tobacco products to carry health warnings on its labels, and in 1969 it banned radio and television cigarette advertisements.

Despite the increased public awareness of the dangers of smoking the second wave of tobacco litigation proved to be a defeat for the smoker/plaintiffs, just as the first had been. The smokers faced many strategic, financial, and legal difficulties in their litigation. As individual plaintiffs, they had to rely on attorneys who were often solo practitioners or members of smaller firms to do battle against wealthy corporations and well-funded corporate counsel. The many smokers' lawsuits were not coordinated with one another. The plaintiffs thus lacked financial and legal resources and organization, while the tobacco industry had both in abundance. In legal terms, moreover, almost all of the plaintiffs' arguments had a fatal flaw: the smokers themselves had made the conscious decision to smoke, and so they, and not the tobacco companies, were ultimately responsible for their illnesses in jurors' eyes. The ever growing weight of research and expert opinion that smoking was dangerous made this relatively easy to prove in court. The paradox was that the knowledge of the dangers was becoming so widespread that the smokers had to shoulder even more of the blame for their injuries, since they had known the risks of smoking but had chosen to smoke anyway.

The results of this paradox were striking. From the mid-1950s to the late 1980s, between 300 and 800 plaintiffs filed personal-injury suits against the major tobacco companies. Of these, fewer than 30 went to trial. Of those that did go to trial, plaintiffs won in only a few cases and all of these were reversed on appeal. The tobacco companies' defenses were impregnable.

Plaintiffs Find a New Argument

Beginning in the early 1990s, however, with antismoking sentiment growing stronger, several changes in litigation procedures occurred. Plaintiffs' lawyers, drawing upon their experience in recent class action injury claims—among them the Dalkon Shield and asbestos suits of the 1970s and 1980s—began to apply their lessons to tobacco litigation. They started to coordinate their efforts with other attorneys, and they sought new strategies and new legal tactics to eliminate the roadblocks that earlier smoker/plaintiffs had faced. Many of these attorneys had watched smoker friends and relatives die of lung disease, and the similarity of these diseases to those of asbestos victims made the asbestos cases especially useful.

Among the leaders of the third wave of tobacco cases were Michael T. Lewis of Mississippi, who HAD lost a friend to what he believed was a smoking-related illness; Richard F. Scruggs, a successful Mississippi asbestos litigator; and Wendell Gauthier, a New Orleans class action lawyer whose best friend, Peter Castano, had recently died of lung cancer. Gauthier joined forces with Ronald L. Motley of Charleston, South Carolina; John P. Coale of Washington, D.C., who had recently sued Union Carbide on behalf of 60,000 people in the wake of the Bophal, India, chemical disaster; and other tobacco and class action litigators. Together the group formed a coalition of attorneys from 60 firms, each of which pledged $100,000 to help cover litigation costs. They decided that their principal tactic would be a federal class action lawsuit on behalf of the tens of millions of addicted smokers in the United States. The case agreed upon was that of Peter Castano, Gauthier's friend, which they filed in March 1994.

The new legal strategy was not to be product liability but instead deception leading to addiction. In 1998, Surgeon General C. Everett Koop had stated that smoking was addictive. But even earlier in 1994, the Food and Drug Administration (FDA) began investigating the charges that tobacco companies had secretly and deliberately increased cigarettes' nicotine content to enhance their addictive quality. This charge eliminated the weakness in earlier plaintiffs' arguments to the effect that they had known of all the dangers from smoking. According to the arguments in the Castano case, the tobacco companies had concealed the full dangers, and so the plaintiffs could not have been responsible for their contracted illnesses.

Given the resources that the attorneys now had, and the potential payout amount involved, the plaintiffs could now meet the tobacco industry on its own terms with a realistic hope for victory and leverage enough for a possible settlement. But the Castano case opened the attorneys to the usual criticism of class action lawsuits: the lawyers would get rich leaving not much for the plaintiffs, who would not be able to file individual suits in the event of a class action victory or settlement. As a result of these criticisms, some attorneys, such as Norwood Wilner and Gregory H. Maxwell of Florida, continued to sue individually, though they also worked to some degree with the Castano attorneys.

State Governments Seek Payback

During this time, Lewis discussed the tobacco litigation with his friend Michael Moore, who was attorney general of Mississippi, and Richard F. Scruggs. The men knew that state governments were spending huge sums of money, through state Medicaid programs and in other ways, to pay for the health hazards of smoking. Also, they realized that individuals could make a decision to smoke despite the risks, but the states had never had the opportunity to make the choice to pay for individuals' ill health. With funding from some of the Castano attorneys, the state of Mississippi—which several other states soon joined—sued the major tobacco companies to recover the costs of smoking that it had borne for its citizens. Deception and addiction again were the key arguments. Mississippi filed the complaint in May 1994, two months after the beginning of the Castano case. Eventually, nearly every state in the country became a party to the litigation.

In the Castano case, the courts ultimately refused to certify all addicted American smokers as a single class and the Castano attorneys soon filed a group of smaller class action lawsuits in various state courts. But in early 1996, before the Castano trial came to an end, the Liggett Group, one of the nation's largest tobacco companies, broke ranks with the others to reach a settlement. This landmark breach in the wall of tobacco company liability required Liggett to pay more than $1 billion to cover some state health care costs for smokers and to fund smoking-cessation programs, in exchange for immunity from future addiction suits.

Still facing concerted action from the state governments, the tobacco companies as a group agreed to another settlement in 1998. In exchange for immunity from future lawsuits, the companies agreed to pay almost $250 billion to the states over a period of 25 years; to limit tobacco advertising; and to take various steps to reduce youth access to tobacco products.

During all of these maneuverings, individual suits continued, made more potent by new evidence from "whistleblower" industry executives, government investigations, and tobacco company documents that the Castano and the states' suits had brought to light. These new revelations indicated that tobacco companies had indeed known of nicotine's addictive qualities and that they had tried to hide that knowledge. Because of these revelations, juries began to believe (and reward plaintiffs accordingly) that smokers had not really known the risks involved in choosing to smoke. A few months after the Castano settlement with Liggett, a Florida jury found the Brown & Williamson Company liable for causing the plaintiff's lung cancer, awarding him $750,000. In 1999, a California jury awarded another smoker punitive damages of $50 million from the Philip Morris Company.

The Feds Hop on Board

With the impregnable wall crumbling rapidly, U.S. Attorney General Janet Reno announced in September 1999 that the federal government would sue the tobacco companies on grounds similar to those of the state governments. The federal case would also invoke RICO (Racketeer Influenced and Corrupt Organizations Act) because of what Reno called the industry's "concerted efforts … to defraud the public."

Reno's decision, the settlement of the state claims, and the states' assertion of those claims to begin with, as well as the Castano class action lawsuit, all raised concern in Congress, among the state governments, and in the private sector. Some feared that the settlements went too far in punishing an industry that played such a large role in the American economy and that paid considerable state and federal corporate taxes; others claimed that they did not go far enough. Still others observed that large-scale litigation by states and private parties had transferred a massive effort at social and economic regulation from the state legislatures into the domain of the courts, putting it to a degree under private control. Many observers wondered what this development might mean for gun manufacturers and health maintenance organizations (HMOs). As of this writing, it is unsure what the future will bring regarding these and other similar groups, or how and in what way the tobacco industry itself will be affected. By the mid-1990s, however, the tobacco companies had begun in increase cigarette sales to foreign countries and had started diversifying their holdings in light of the growing apprehension that tobacco would soon be a bad investment.

—Buckner F. Melton, Jr.

Suggestions for Further Reading

Kluger, Richard. Ashes to Ashes: America's Hundred-Year Cigarette 1Var; the Public Health, and the Unabashed Triumph of Philip Morris. New York: Alfred A. Knopf, 1996.

Orey, Michael. Assuming the Risk: The Mavericks, the Lawyers, and the Whistle-Blowers Who Beat Big Tobacco. Boston: Little, Brown and Co., 1999.

The People vs. Big Tobacco: How the States Took on the Cigarette Giants. Princeton, N.J.: Bloomberg Press, 1998.

Pringle, Peter. Cornered: Big Tobacco at the Bar of Justice. New York: Henry Holt, 1998.