Big tobacco has suffered a big defeat and the industry is reeling from RICO.  The D.C. Circuit Court of Appeals has recently held that nine cigarette manufacturers could be found to have violated RICO, the Racketeer Influenced and Corrupt Organizations Act.  In a 1,600-page opinion, the Court said the evidence showed that beginning as far back as 1953, the manufacturers met together to strategize a response to growing public concern about the health risks of smoking and engaged in a scheme to defraud smokers by falsely denying the adverse effects of smoking.  They also manipulated cigarette design to assure delivery of addictive levels of nicotine, conspired to market cigarettes to youth, to understate the effects of secondhand smoke, and to falsely represent that light and low tar cigarettes presented fewer health risks.  In a final blow, the Court held that the master settlement agreement with the states settled future tort cases but not future racketeering claims.  Let’s just say that tobacco industry is staring down the barrel of a smoking gun.

THIS IS NEIL CHAYET LOOKING AT THE LAW™

U.S. v. Philip Morris U.S.A., Inc., D.C. Circuit Court of Appeals, No. 06-5267, May 22, 2009, per curiam, U.S. Law Week, Vol. 77, No. 46, Pg. 1737, 6-2-09

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