In what could become the largest legal settlement in history, cigarette manufacturers agreed yesterday to pay $368 billion over 25 years, drastically restrict advertising and help smokers quit to resolve lawsuits on behalf of millions of Americans sickened or killed by tobacco.
The "agreement in principle" between the tobacco companies and their adversaries was hailed by some as a milestone in the battle against smoking. It marks an abrupt turnaround in the industry's four-decade refusal to recognize the health damage caused by its products.
"The proposal is a bitter pill," said a statement from the nation's four largest tobacco companies, Philip Morris, R. J. Reynolds, Brown & Williamson and Lorillard. "But on balance, this plan is preferable to the continuation of a decades-long controversy that has failed to produce a constructive outcome for anyone."
Many legal and public health experts reacted with caution, criticizing elements of the proposed settlement as too weak or vulnerable to exploitation by companies with a history of evading regulation. Many smoking foes and politicians declined to take a position until they can read the complex 68-page document.
"I'd love to declare victory, but the answers are going to be in the details," said David A. Kessler, former director of the Food and Drug Administration, who aggressively sought to regulate nicotine as a drug.
Because it requires changes in federal policy, the agreement must be approved by President Clinton and enacted into law by Congress. That process could take months, with the potential for deal-breaking impasses along the way.
"I won't tell you this is the end," said Michael Moore, the Mississippi attorney general, who led the negotiations.
"This is the beginning of the end for the way the tobacco industry treats the American people."
Among the skeptics was Maryland Attorney General J. Joseph Curran Jr., who filed the state's tobacco suit last year. He said he appreciated the arduous negotiating by a dozen attorneys general and plaintiffs' lawyers, led by Moore. He praised the advertising restrictions and the financial penalties imposed if the industry does not reach goals of reducing youth smoking by 30 percent in five years and 60 percent in 10 years.
But Curran said he "regretfully concluded we need to go further." He said that he does not like the changes the plan would force on the litigation system by banning class action suits and that he finds "troubling" the limits placed on the FDA's right to regulate nicotine.
"If something goes to Congress and I'm not happy with it, I'll tell that to Congress," Curran said. And until Congress approves a plan, he said, "we still have a lawsuit, and we're preparing to try our case in January 1999."
One possible subject for a future battle is allocation of the billions in payments among the 50 states. For example, Mississippi, which filed the first Medicaid lawsuit, pioneered the legal approach and led the negotiations, might claim a disproportionate reward. But California, one of a dozen Johnny-come-lately states that sued only as a settlement became likely this month, has spent far more to treat smokers' illnesses.
If the proposed settlement becomes final, it will make dramatic changes in America's cultural landscape, in which tobacco has long been a landmark.
Gone would be all outdoor advertising, the placards clustered around convenience store cash registers, T-shirts and travel bags bearing the emblems of cigarette makers.
Tobacco companies would no longer sponsor sports events or pay to have their cigarettes appear in movies. Remaining advertisements could use neither human figures nor cartoon characters.
Marlboro Man is history
"In essence, the Marlboro Man will be riding into the sunset on Joe Camel," said Bob Butterworth, Florida's attorney general.
While the attorneys general who announced the proposed deal at a packed news conference in a Washington hotel stressed such industry concessions, the agreement also reflects major concessions by the anti-tobacco forces.
For example, the FDA has the power to ban nicotine today; the agreement, however, would not allow an outright ban until 2009. The industry faces at least 17 class-action lawsuits today, including two filed on behalf of ailing smokers in Maryland and the District of Columbia by Baltimore lawyer and Orioles owner Peter G. Angelos; only individual lawsuits would be permitted under the proposed settlement, and the total damages paid each year would be capped at $5 billion.
And while huge amounts of money would be paid by the industry -- and payments of $15 billion a year would continue indefinitely -- the industry could pass on its costs to its addicted customers with a per-pack price hike of 75 cents or $1.
Meanwhile, U.S. tobacco companies have sharply boosted marketing overseas, where few regulations apply.