U.S. poised to file suit against tobacco firms

Bid to recover billions in costs of health care could be lodged today

September 22, 1999|By NEW YORK TIMES NEWS SERVICE

WASHINGTON -- The Justice Department is about to file a civil suit against the tobacco industry, seeking to recover billions of dollars in health-related expenses that cigarette smoking has cost over the decades, a government official said last night.

"The Justice Department believes smoking-related illnesses have cost the American taxpayers billions of dollars, and it is seeking ways to get the taxpayers' money back," said the government official, who is familiar with the case and spoke last night on condition that he not be quoted by name.

While the lawsuit had been expected since President Clinton proposed it in his State of the Union address in January, it is still a blow to the industry, which thought it had put most of its legal problems behind it by settling hundreds of millions of dollars in lawsuits by the states and beating back congressional efforts to strongly regulate nicotine.

A lawyer for the tobacco industry reached last night said he was unaware of an imminent legal action by the government. But in recent months officials from tobacco companies and a public relations firm hired by the industry have conducted an aggressive campaign depicting any federal lawsuit as ungrounded and legally unviable. An effort was made in Congress this year to curtail financing that the Justice Department would need to pay for the litigation against the industry.

After the State of the Union, the cigarette industry said the president's remarks were "blatantly political" and meant to demonize the tobacco companies. People who had long followed tobacco litigation said the cigarette makers were rattled by the prospect of facing an adversary -- the federal government -- with pockets as deep as their own.

The suit, which has been planned for nearly a year, might allege that cigarette smoking has cost as much as $25 billion a year from the effects of lung cancer and other diseases linked to the smoking habit. The $25 billion is calculated from the numbers of health claims paid to veterans and the elderly through Medicare, according to the Washington Post, which reported on the impending suit in its editions today.

The official would not discuss the exact timing of the suit -- the Post said it might be filed as soon as today -- but he made it clear that it is about to be lodged.

Last year, 46 states settled with tobacco companies for a total of $206 billion for health costs the states had carried over the years because of smoking.

So at the start of 1999, the tobacco industry thought it had ensured its survival and perhaps its prosperity, albeit at a cost of $206 billion to be paid over 25 years.

The Post reported that as part of its suit, to be filed in U.S. District Court, the Justice Department will contend that the tobacco companies engaged in civil racketeering. The suit will allege industrywide collusion in consumer fraud to conceal the risks of smoking, the newspaper said.

Because the state lawsuits were intended to recover health care costs spent through the Medicaid program on low-income patients, the federal government is seeking to recover similar expenses spent treating the elderly through the Medicare program, and treating smoking-related ills among active and retired military personnel and government employees.

Pub Date: 9/22/99

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