Tobacco(redirected from Tobacco Extracts)
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For centuries the leaves of the tobacco plant have been used for making smoking tobacco and chewing tobacco. Tobacco contains small amounts of nicotine, a stimulant that acts on the heart and other organs and the nervous system when tobacco is inhaled, ingested, or absorbed. Nicotine's effect on the nervous system causes people to become addicted to it, and the stimulating effects make smoking and chewing tobacco pleasurable. Concentrated amounts of nicotine are poisonous, however. Although the use of tobacco was condemned on occasion in the past, not until the latter half of the twentieth century were concerted efforts made to curb tobacco use in the United States.
Before the arrival of Europeans in America, Native Americans were growing and harvesting tobacco to be smoked in pipes. Europeans exploring America learned of this practice and took tobacco seeds back to Europe where tobacco was grown and used as a medicine to help people relax. European physicians believed that tobacco should be used only for medicinal purposes. Commercial production of tobacco began in the colony of Virginia in the early seventeenth century where it soon became an important crop. The expansion of tobacco farming, especially in the southern colonies, contributed to the demand for and practice of Slavery in America. Most tobacco grown in the American colonies was shipped to Europe until the Revolutionary War, when manufacturers began using their crops to produce chewing and smoking tobacco.
The use of tobacco for other than medicinal purposes was controversial: the Puritans in America believed that tobacco was a dangerous narcotic. Nevertheless, chewing and smoking tobacco became increasingly popular. Cigars were first manufactured in the United States in the early nineteenth century. Hand-rolled cigarettes became popular in the mid-nineteenth century, and by the 1880s, a cigarette-making machine had been invented. In the twentieth century tobacco use, especially cigarette smoking, continued to expand in the United States.
By the 1960s, however, scientists had confirmed that smoking could cause lung cancer, heart disease, and other illnesses. Some cigarette manufacturers reacted to these findings by reducing the levels of nicotine and tar in their cigarettes, but the medical community established that these measures did not eliminate the health risks of smoking. Subsequently, extensive research linked cigarette smoking and tobacco chewing to many serious illnesses.
In 2001, the American Lung Association estimated that over 400,000 deaths per year in the United States were directly attributable to smoking, which resulted in health care costs
Cipollone v. Liggett Group, Inc.
Cipollone v. Liggett Group, Inc., 693 F. Supp. 208 (D.N.J. 1988), aff'd in part, rev'd in part, 893 F.2d 541 (3d Cir. [N.J.] 1990), cert. granted, 499 U.S. 935, 111 S. Ct. 1386, 113 L. Ed. 2d 443 (1991), aff'd in part, rev'd in part, 505 U.S. 504, 112 S. Ct. 2608, 120 L. Ed. 2d 407 (1992), was the first case in which a former smoker recovered monetary damages against the U.S. tobacco industry. It is also considered a landmark tobacco case because of the legal precedent it established.
Rose Cipollone smoked cigarettes manufactured by defendant Lorillard for forty years. She started smoking at an early age because she thought it was the cool and grown-up thing to do and soon found that she could not stop the habit. Cipollone developed lung cancer, requiring the removal of her right lung. She died before her case went to trial, but her husband pursued her claims on her behalf.
Cipollone brought fourteen claims against Liggett Group, Inc., Philip Morris, Inc., and Lorillard, including Strict Liability, Negligence, breach of Warranty, intentional tort, and conspiracy. The intentional tort claims included the allegation that the tobacco companies had fraudulently misrepresented that smoking was safe through their advertising and conspired to keep the public from learning about the Scientific Evidence that clearly demonstrated the health hazards of smoking.
The tobacco companies argued that Rose Cipollone knowingly chose to smoke and therefore accepted all of the dangers and health consequences associated with it. On the other hand, the tobacco companies vehemently maintained that there is no medical or scientific basis to show that smoking is linked to cancer or other diseases.
The Cipollonecase lasted ten years and included the filing of one hundred motions, four Interlocutory appeals, four months of trial, an appeal from the jury verdict, two petitions of certiorari to the U.S. Supreme Court, and argument and then reargument before the Court. Although the jury in the first trial awarded the plaintiff $400,000 in damages, the verdict was ultimately overturned on appeal due to technical mistakes, and a retrial was ordered. By that time, the three legal firms representing the plaintiff had spent collectively more than $6.2 million on the case and could not afford to continue. In contrast, the defendants spent $40 million and never had to pay one cent to the Cipollones.
This case made history at the pretrial stage because the court ordered the tobacco industry to release thousands of pages of confidential internal documents that the plaintiff needed to prove that the tobacco industry conspired to prevent the public from being informed of the health hazards of smoking (649 F. Supp. 664). The court also held that, because of the enormous public interest in these documents, they could be released to third parties and used in other related cases (113 F.R.D. 86 [D.N.J. 1986]; 822 F.2d 335 [3d Cir. 1987], cert. denied, 479 U.S. 1043, 107 S. Ct. 907, 93 L. Ed. 2d 857 ). However, the defendants were still able to protect the most damaging documents by asserting the Attorney-Client Privilege and the work product doctrine (140 F.R.D. 684). Without those damaging documents, the jury rejected the plaintiff's theories of conspiracy or Misrepresentation, but did find in her favor on the claim of breach of the express warranty that cigarettes were safe.
Cipolloneis also the definitive case regarding the Preemption of state tort claims by the Federal Cigarette Labeling and Advertising Act (FCLAA) (79 Stat. 282). The Supreme Court held that the FCLAA preempts state law damage claims that are based on a cigarette manufacturer's failure to warn of the health risks of smoking and its neutralization of the federally mandated warnings through advertising techniques, to the extent that those claims rely on omissions or inclusions in the manufacturer's advertisements or promotions (505 U.S. 504, 112 S. Ct. 2608, 120 L. Ed. 2d 407 ). However, the Supreme Court also held that the FCLAA does not preempt claims that are based on strict liability, negligent design, express warranty, intentional Fraud and misrepresentation, or conspiracy.
Bajalia, Mark. 1993. "The Supreme Court Renders Its Decision: Federal Preemption, the Cigarette Act and Cipollone." National Trial Lawyer 5 (May).
Fenswick, C.F. 1993. "Supreme Court Takes Middle Ground in Cigarette Litigation." Tulane Law Review 67 (February).
of over $90 billion. Tobacco is responsible for more deaths in the United States than car accidents, Acquired Immune Deficiency Syndrome (AIDS), alcohol, illegal drugs, homicides, suicides, and fires combined.
Medical research has not only proven that smoking is injurious to the health of the smoker, but it has also established that nonsmokers can be harmed by inhaling the cigarette smoke of others. This type of smoke is called secondhand smoke, passive smoke, involuntary smoke, or environmental tobacco smoke (ETS). In 1993, the Environmental Protection Agency(EPA) classified ETS as a known human (Group A) carcinogen because it causes lung cancer in adult nonsmokers and impairs the respiratory and cardiovascular health of nonsmoking children. ETS, which is the third leading preventable cause of death in the United States, contains the same carcinogenic compounds as are found in the smoke inhaled by smokers.
As these research findings have appeared, concern over tobacco's effect on health has played an important role in encouraging government regulation of tobacco. At the same time, however, the popularity of tobacco use has resulted in considerable political and financial strength for the tobacco industry. By the 1990s tobacco had become the seventh largest cash crop in the United States, and tobacco growers and manufacturers were realizing $47 billion annually. With such revenues available, the tobacco industry has been able to exert significant influence over tobacco regulation. In a report released by the Campaign for Tobacco-Free Kids, the American Heart Association, and the American Lung Association, the tobacco industry contributed more than $3 million in "soft money" funds to political candidates and political committees, in 2001. Because the industry is also central to the economies of many tobacco-producing states, members of Congress from those states have opposed restrictions on tobacco companies.
Despite the tobacco companies' efforts, the industry is subject to extensive federal and state regulation. Among the federal agencies with minor regulatory interests in tobacco and tobacco products are the bureau of alcohol, tobacco, firearms, and explosives, the Tax and Trade Bureau, the Health and Human Services Department, the Agriculture Department, and the Internal Revenue Service. Federal agencies with broader power to regulate tobacco include the Federal Trade Commission (FTC), the Federal Communications Commission (FCC), and, the most recent to assert jurisdiction, the Food and Drug Administration (FDA).
Federal Regulation of Tobacco Advertising and Labeling
In the 1950s, the federal government began to regulate the sale and production of chewing and smoking tobacco because of the growing concern over its adverse effects on the health of consumers. Traditionally, the FTC was the federal agency primarily responsible for the regulation of tobacco products, especially with regard to labeling and advertising. In 1955, the FTC promulgated guidelines that prohibited cigarette advertisements from carrying therapeutic health claims. In 1964, the commission issued a Trade Regulation Rule on Cigarette Labeling and Advertising that strictly controlled the advertising and labeling of tobacco products. The FTC claimed that the failure to warn consumers of the dangers of smoking constituted an unfair and deceptive trade practice under the Federal Trade Commission Act (15 U.S.C.A. § 41 ).
Shortly after the FTC issued its trade regulation rule, Congress intervened by enacting the Federal Cigarette Labeling and Advertising Act (FCLAA) (15 U.S.C.A. §§ 1331 et seq. ), which was more moderate than the FTC regulation and preempted agency action. The FCLAA required that a health warning be conspicuously displayed on all packages and cartons of cigarettes. As originally enacted, the FCLAA required only the warning, "Caution: Cigarette Smoking May Be Hazardous to Your Health." Subsequently, however, this act was amended to require more explicit warnings. Under amendments added in 1984, cigarette manufacturers must use one of the following labels to satisfy the health warning requirement:
SURGEON GENERAL'S WARNING: Smoking Causes Lung Cancer, Heart Disease, Emphysema, and May Complicate Pregnancy.
SURGEON GENERAL'S WARNING: Quitting Smoking Now Greatly Reduces Serious Risks to Your Health.
SURGEON GENERAL'S WARNING: Smoking by Pregnant Women May Result in Fetal Injury, Premature Birth, and Low Birth Weight.
SURGEON GENERAL'S WARNING: Cigarette Smoke Contains Carbon Monoxide.
The warning labels must also appear on all cigarette advertising, including magazine advertisements and billboards.
In 1986, Congress enacted the Comprehensive Smokeless Tobacco Health Education Act (CSTHEA) (15 U.S.C.A. §§ 4401 et seq.), which requires smokeless tobacco products to carry one of the following warning labels:
"WARNING: THIS PRODUCT MAY CAUSE MOUTH CANCER"
"WARNING: THIS PRODUCT MAY CAUSE GUM DISEASE AND TOOTH LOSS"
"WARNING: THIS PRODUCT IS NOT A SAFE ALTERNATIVE TO CIGARETTES."
National Clean Air Debate
On April 5, 1994, the Occupational Safety and Health Administration (OSHA) published proposed nationwide indoor air quality regulations that would prevent smoking in all indoor workplaces, including office buildings, government buildings, restaurants, stores, and bars, except in designated smoking areas with separate ventilation systems (59 Fed. Reg. 15,968–16,039). OSHA provided a public comment period followed by public hearings, which were extended a number of times, and finally closed the hearings in January 1996. OSHA also sought post-hearing comments, but by the end of 1997 the administration had not announced when, or whether, it would issue its final rules addressing this controversial topic. The dispute over the OSHA regulations frames the larger debate between advocates and opponents of smoking regulations.
Proponents of the indoor air quality regulations argue that if people are freely allowed to smoke in the workplace, they contaminate the air that nonsmokers breathe, subjecting everyone around them to severe health consequences. Proponents cite decades of scientific and medical studies that demonstrate the health effects of environmental tobacco smoke (ETS). They refer to studies that show that ETS causes lung cancer and heart disease in adults and various respiratory disorders in children.
Various government agencies support OSHA's proposed regulations. The U.S. Surgeon General has published numerous reports warning of the dangers of ETS. The Labor Department reported to OSHA that 83 percent of all worker health complaints related to indoor air quality are linked to ETS. Since 1992, the U.S. Environmental Protection Agency has classified ETS as a known Group A human carcinogen. Various other medical and research organizations support the proposed regulations as well. The National Academy of Sciences has warned of the dangers of ETS. A 1995 study published in the Journal of the American Medical Association found that nicotine levels in the air at work sites with no restrictions on smoking were triple the amount considered hazardous by U.S. regulatory standards.
Proponents of the regulations are concerned for the health of the non-smokers, but they also cite many economic reasons for instituting the indoor air quality regulations nationwide. For example, employers must pay more for Health Insurance for their employees when their employees smoke or are exposed to ETS. Employers also suffer productivity losses when their employees are sick or disabled due to smokingrelated illnesses. Smoking also causes premature deaths in employees, which results in a productivity loss to the employer. When smoking is allowed in the workplace, there is more trash, such as cigarette butts, to clean up. Proponents of the smoking regulations also argue that computer equipment, carpets, furniture, and other furnishings need more maintenance and must be replaced more frequently when smoking is permitted in the workplace. Finally, employers who are forced to choose between the rights of smoking workers and the rights of nonsmoking workers fear that they will be liable for nonsmoker injuries. For example, under the Americans with Disabilities Act, 104 Stat. 327, if ETS prevents a worker from being able to perform her job, the employer may be responsible for allowing the ETS in the workplace.
Opponents of the indoor air quality regulations include restaurant, bar, and hotel owners, trade associations, cigarette manufacturers, smokers, and those who seek to protect individual freedoms from government regulation. Activist organizations that promote smokers' rights include the National Smokers Alliance, the United Smokers Association, and the American Puffer Alliance. These groups point out that their numbers are large; in fact, there are approximately 52 million Americans who do not support the crusade to stop smoking. Further, many of these groups stand for principles of tolerance, fairness, and inclusion and seek to promote accommodation of the wishes of smokers as well as nonsmokers.
Opponents of the regulations argue that exposure to ETS really is not as dangerous to nonsmokers as many anti-smoker groups contend. In fact, the opponents have scientific research to support their theories. In addition, they attack contrary studies as being statistically flawed and claim that any conclusions showing an association between ETS and disease are really due to confounding variables in the studies. Other opponents, particularly restaurant, bar, and hotel owners, reject the proposed workplace smoking ban as overly restrictive and likely to lead to a serious financial loss to business owners. Some opponents of the regulations focus on the fact that their freedom to smoke is a liberty interest and a privacy right that is being impinged.
A large opponent of the proposed indoor air quality regulations is the Center for Indoor Air Research (CIAR), a nonprofit, independent research organization founded in 1988 by three large tobacco companies. CIAR has been instrumental in providing research results to refute those that suggest that ETS is harmful. A 1992 study conducted by CIAR concluded that moderate amounts of smoking indoors will not interfere with acceptable air quality. CIAR also conducted a study to determine the quantities of ETS that people are actually exposed to in the workplace. Finding that most people are exposed to very little ETS on the job, CIAR concluded that the federal government does not need to regulate smoking in the workplace. Another CIAR study that examined workplace smoking policies, ventilation, and indoor air quality concluded that the role ETS plays in contributing to poor indoor air quality is very minor, if it plays any role at all. The findings from this study show that OSHA's proposal to require separate ventilation systems for smoking areas is unnecessarily restrictive. Another CIAR study concerning indoor air quality, published in 1992, and criticized by a congressional subcommittee in 1994 as being flawed due to falsified or fabricated data, concluded that the levels of ETS in "light smoking" rooms were very similar to the levels of ETS in "nonsmoking" rooms within hundreds of different office buildings.
In addition to quoting studies conducted by CIAR and other tobacco-industry-funded organizations, opponents of the OSHA regulations cite to studies that were not funded by the tobacco industry and thus do not convey the appearance of bias. For example, a 1995 study by the Congressional Research Service (CRS), the research arm of the Library of Congress, found no statistically significant correlation between ETS and lung cancer.
Restaurant and bar owners nationwide fear that the regulations will cause a decline in their business and result in serious financial consequences for them. In fact, these groups can already demonstrate the validity of their fears: studies of restaurants in cities and states that already have smoking bans have shown that these businesses have suffered an average decline of 24 percent in sales.
Others argue that banning smoking in the workplace is an infringement of personal rights. Specifically, they argue that workplace smoking bans violate the right to privacy and liberty interests protected by the Constitution. Opponents of the proposed nationwide ban can cite to judicial decisions that hold that federal regulations imposed on smoking employees must have a rational basis related to on-the-job performance. (In Grusendorf v. Oklahoma City, 816 F.2d 539 [10th Cir. 1987], a one-year smoking ban for firefighter trainees was upheld.) Other courts have held that employers cannot prohibit all smoking on their property if a ban violates a collective bargaining agreement (Johns-Manville Sales Corp. v. International Ass'n of Machinists, 621 F.2d 756 [5th Cir. 1980]). In addition, several states have enacted "smokers' rights laws" that stop employers from regulating off-duty smoking habits of employees and from discriminating against employees or job applicants based on their smoking habits outside the workplace. Opponents of OSHA's proposed indoor air quality regulations argue that employers likewise have no right to impinge upon their employees' freedom to smoke while at work.
Smokers also argue that their decision to smoke and the risks involved are no different from other personal lifestyle choices. If smoking is banned in the workplace, then there is no limit as to what other risky, but legal, behaviors may be banned in the workplace. For example, employers could prohibit the consumption of fatty foods. The crux of the issue, argue opponents, is that smoking is a legal activity and smokers should be left alone in deciding which risks they want to take in their lives.
The CSTHEA also requires all manufacturers, packagers, and importers of smokeless tobacco to provide the secretary of the Health and Human Services Department with a list of all ingredients used in the manufacture of the product, as well as the quantity of nicotine contained in the product. The act further requires the secretary to report biennially to Congress with a summary of research on the health effects of smokeless tobacco, information about whether its ingredients pose a health risk, and recommendations for legislative or administrative action. Finally, the act requires the FTC to report biennially to Congress about the state of smokeless tobacco sales, advertising, and marketing practices and also to make recommendations for legislative or administrative action. Amendments to the FCLAA require similar reports on smoking tobacco products.
In 1967, the FCC decided to act upon citizen complaints it had received regarding broadcast cigarette advertising. The FCC implemented a rule requiring any station that broadcasts cigarette advertising to also air public service announcements prepared by various health organizations in an effort to inform listeners and viewers of the dangers of smoking. This FCC regulation was challenged in the courts but upheld under the Fairness Doctrine, which requires broadcasters to provide a balanced representation and fair coverage of controversial issues of public importance (Banzhaf v. FCC,405 F.2d 1082 [D.C. Cir. 1968]).
A few years later, Congress also intervened on the issue of broadcast advertising, electing to ban all television and radio advertising of cigarettes. Congress enacted the Public Health Cigarette Smoking Act of 1969 (Pub. L. No. 91-222, § 6, 84 Stat. 87, 89), which was codified as an amendment to the earlier FCLAA. The new regulations took effect in 1971 and prohibited all advertising of cigarettes and small cigars via electronic communication, subject to the jurisdiction of the FCC (15 U.S.C.A. § 1335). The tobacco companies challenged the constitutionality of the Public Health Cigarette Smoking Act, but it was upheld by the courts (Capital Broadcasting Co. v. Mitchell, 333 F. Supp. 582 [D.D.C. 1971], aff'd mem., 405 U.S. 1000, 92 S. Ct. 1289, 321 L. Ed. 2d 472 ). Beginning in 1986, Congress also made it illegal to advertise smokeless tobacco on any medium of electronic communication that is subject to the jurisdiction of the FCC (15 U.S.C.A. § 4402(f)). The FCLAA, as amended by the Public Health Cigarette Smoking Act of 1969, did not work wholly to the detriment of the tobacco industry. Some legal commentators argue that it actually benefited the tobacco companies. The warning labels that were required to help inform consumers of the health risks associated with tobacco worked to provide the manufacturers with a shield against tort liability. In fact, before the matter was taken up by the U.S. Supreme Court in 1992, several circuit courts held that the FCLAA had preempted (previously addressed) state claims against the tobacco companies based on a failure-to-warn legal theory (Pennington v. Vistron Corp., 876 F.2d 414 [5th Cir. 1989]; Roysdon v. R. J. Reynolds Tobacco Co., 849 F.2d 230 [6th Cir. 1988]; Palmer v. Liggett Group, 825 F.2d 620 [1st Cir. 1987]; Stephen v. American Brands, 825 F.2d 312 [11th Cir. 1987]).
In cipollone v. liggett group, 505 U.S. 504, 112 S. Ct. 2608, 120 L. Ed. 2d 407 , the U.S. Supreme Court held that the FCLAA had preempted state law damage. In effect, because tobacco companies were federally mandated to include warning labels on their products, they were essentially immune from product-liability suits. The Supreme Court held, however, that the FCLAA did not preempt claims based on Strict Liability, negligent design, express Warranty, intentional Fraud and Misrepresentation, or conspiracy. This means that companies could be sued for knowingly withholding or falsifying information about health risks associated with the use of tobacco products.
The tobacco industry also benefited indirectly from the FCLAA's ban on advertising because when television advertising ceased, so did the antismoking public service messages that broadcasters were previously required to air. In fact, Judge Skelly Wright, the author of the dissenting opinion in Capital Broadcasting Co., noted that the Public Health Cigarette Smoking Act of 1969 was a legislative coup on the part of the tobacco industry. Wright accurately predicted that the loss of the broadcast antismoking messages would result in a rise in cigarette consumption.
Federal and State Regulation of Tobacco through Taxation
Even though cigarettes cannot be advertised on radio or television, they are the most heavily advertised product in the United States. In the early 1990s, in an attempt to raise revenue for the federal government, bills were introduced in Congress to restrict the amount of advertising expenses that tobacco manufacturers could deduct from their gross income. (In 1993, tobacco companies deducted an estimated $1 billion from their gross income for advertising expenses.) The proposed bills would have used the extra revenue to fund education programs to stop underage smokers and to reduce the federal deficit. The bills did not become law, however.
States have long collected excise taxes on sales of cigarettes. As of 2003, New Jersey imposed the highest excise tax, at $2.05 per pack, and Kentucky (a tobacco-producing state) had the lowest, at 3 cents per pack. Excise taxes were also imposed on chewing tobacco products. Studies completed in the 1980s demonstrated that as the price of chewing and smoking tobacco increases, consumption of those products decreases.
Federal Regulation of Tobacco as a Drug
In 1988, the Surgeon General of the United States issued a report detailing the addictive effects of nicotine. Later scientific studies confirmed this finding. Despite this research the tobacco companies continued to deny that any relation existed between smoking and disease or that smoking was addictive. In an April 1994 congressional hearing on nicotine manipulation, the chief executive officers of seven tobacco companies testified under oath that they believed nicotine is not addictive and that smoking has not been shown to cause cancer. Later, however, some former tobacco company officials publicly confessed that cigarette manufacturers had long known about the health hazards of smoking and had deliberately concealed that information from the public.
The first and perhaps best known of these officials was Jeffrey Wigand, the former head of research at Brown and Williamson, one of the large tobacco companies. Voluminous internal records showing that cigarette manufacturers were aware of the dangers of smoking, including the addictive properties of nicotine, were also leaked to the public. One paralegal at Brown and Williamson copied more than four thousand documents and provided them to tobacco opponents. An annotated compilation of those documents was published, in 1996, under the title The Cigarette Papers. As a direct result of this growing body of information demonstrating that the manufacturers knew that nicotine in smoking and chewing tobacco can lead to addiction, the FDA, in 1994, began examining whether nicotine qualified as a drug under the Food, Drug and Cosmetic Act (21 U.S.C.A. §§ 301 et seq.), and thus could be regulated as such by the FDA.
The FDA had formerly asserted jurisdiction over tobacco products only to the extent that they carried therapeutic claims. By 1996, however, the FDA had determined that cigarettes and other tobacco products are intended by their manufacturers to be delivery devices for nicotine, a drug resulting in significant pharmacological effects on the body, including addiction. Based on the Food, Drug and Cosmetic Act definition of a drug as an article "intended to affect the structure or any function of the body" and on the FDA's determination that the cigarette and smokeless tobacco manufacturers "intend" these effects, the FDA declared, in August 1996, that it had jurisdiction to regulate tobacco products.
The FDA then announced that it would begin by regulating the sale and distribution of cigarettes and smokeless tobacco products to children and adolescents. The issue of children smoking has aroused widespread concern. Studies in the 1990s demonstrated that despite state laws prohibiting the use of tobacco before the age of 18, children had easy access to tobacco products and many had become regular smokers before their eighteenth birthday. In 1996, the FDA estimated that 4.5 million children and adolescents in the United States smoke and that another 1 million children use smokeless tobacco. Accordingly, the FDA promulgated a proposed rule to reduce children's access to tobacco and limit its appeal to them. The final FDA rule treated nicotine addiction as a pediatric disease because the use of tobacco products and the resulting nicotine addiction begin predominantly in children and adolescents. The FDA concluded that children do not fully understand the risks associated with consuming tobacco and that they are vulnerable to the sophisticated marketing techniques used by the tobacco industry. As a result, the FDA regulations governed tobacco products' promotion, labeling, and accessibility to children and adolescents.
The tobacco companies sued in federal court, arguing that the FDA lacked the statutory authority to impose regulations on tobacco The Supreme Court, in FDA v. Brown & Williamson Tobacco Corp. 529 U.S. 120, 120 S. Ct. 1291, 146 L. Ed. 2d 121 (2000), struck down the FDA regulations. The Court, in a 5–4 decision, held that the Food, Drug, and Cosmetic Act, read as a whole, along with recent tobacco legislation passed by Congress, clearly showed that the FDA did not have the authority to regulate tobacco products. The Court acknowledged that the case involved "one of the most troubling public health problems facing our Nation today: the thousands of premature deaths that occur each year because of tobacco use." Yet, the Court also pointed out that "Congress, for better or for worse, has created a distinct regulatory scheme for tobacco products," and that it has "repeatedly acted to preclude any agency from exercising significant policymaking authority in the area."
State Regulation of Tobacco
State and local governments are also involved in the regulation of tobacco and tobacco products. Such regulations typically restrict the use of tobacco by minors, require licenses for those who sell tobacco products, and restrict vending machine and individual cigarette sales. The scope of state and local regulation is limited, however, because it may not extend to areas already being regulated by the federal government. For example, because the FCLAA regulates advertising based on smoking and health considerations, states and localities can restrict advertising only for other reasons, such as to protect citizens' aesthetic sensibilities, to control the location or types of cigarette displays, or to protect children from promotions blatantly aimed at them as consumers.
Whether the FCLAA preempts state regulation of promotions aimed at children has been disputed in the courts. In Penn Advertising v. City of Baltimore, 862 F. Supp. 1402 (D. Md. 1994), aff'd, 63 F.3d 1318 (4th Cir. 1995), vacated by Penn Advertising v. Schmoke, 518 U.S. 1030, 116 S. Ct. 2575, 135 L. Ed. 2d 1090, the court held that the FCLAA did not preempt a local ordinance that barred cigarette advertising in certain locations where children were likely to be found, such as near schools.
However, in Lorillard Tobacco Corp. v. Reilly, 533 U.S. 525, 121 S. Ct. 2404, 150 L. Ed. 2d 532 (2001), the Supreme Court struck down a state regulation that prohibited tobacco ads within one thousand feet of public playgrounds, parks, and schools. The Court reaffirmed its holding that the FCLAA preempted most state regulation of advertising. States were free to use Zoning restrictions to limit the size and location of advertisements of all products, not just tobacco products. The state regulation in this case was invalid because it dealt only with tobacco advertising. In addition, the regulation violated the First Amendment because it unduly restricted commercial free speech.
Clean Indoor Air Acts
Armed with information showing the effects of ETS, the federal, state, and local governments began considering statutes to prohibit smoking in nonresidential buildings. Federal laws were passed to restrict smoking in transportation systems (49 C.F.R. § 1061.1 ), in government buildings (41 C.F.R. § 101-20.105-3 ), and aboard domestic airline flights (14 C.F.R. § 129.29). Federal regulation of private-sector workplaces has yet to take effect. Federal legislation was proposed, but the tobacco industry was able to muster great resistance to it.
States and localities have responded to the concern over ETS by regulating smoking in various public areas. In 2003, 41 states and the District of Columbia had some form of regulation in place. A minority of states have enacted indoor air quality acts, similar to the rules proposed by the Occupational Safety and Health Administration (OSHA). Some local governments have passed laws restricting smoking in places of entertainment, restaurants, and workplaces and on public transportation. Most of the state and local smoking regulations do not ban smoking in the workplace entirely, but limit smoking to designated areas or private offices.
Many private employers have voluntarily restricted smoking in the workplace. A 1985 survey found that more than 33 percent of employers were already regulating smoking in the workplace, and by 1991 that number had grown to 85 percent. By the late 1990s many private businesses had established policies that made it nearly impossible for employees to work and smoke. For example, some businesses do not allow anyone who has smoked within a certain time period to enter the building. Other businesses raised rates for Health Insurance for employees who smoke. Indeed, businesses are motivated to regulate smoking in part because of the higher absenteeism and increased health care costs of employees who smoke.
Tobacco litigation can be divided into three distinct time frames based on the types of claims pursued and the legal theories on which those claims were based. The first wave of tobacco litigation (1954–1973) involved cases based mainly on the theories of deceit, breach of express and implied warranties, and Negligence. Cases filed during the second wave of tobacco litigation (1983–1992) were based on the legal theories of failure to warn and strict liability. Neither of the first two waves of litigation proved to be successful for the plaintiffs.
The first wave of litigation was characterized by the tobacco industry's adamant claims that smoking and chewing tobacco products were not harmful to consumers. Plaintiffs during that time did not have the extensive medical studies demonstrating serious health consequences that are available today to support their claims. Thus, plaintiffs had a difficult time establishing the essential element of proximate cause (causal connection to the injury) in their tort cases. By the time of the second wave of tobacco litigation, the connection between smoking and illness had been firmly established, but the tobacco industry was still able to argue with great success that smokers assumed the risks of smoking by freely deciding to smoke. The FCLAA's requirement that a warning label be placed on all cigarette packaging and advertising supported the tobacco companies' defenses of contributory negligence and assumption of the risk.
During the first two waves of litigation, the tobacco companies were also successful in using their size and financial strength to make litigation as difficult as possible for the plaintiffs. The tobacco industry filed and argued every conceivable motion, took countless depositions, and sent out extensive interrogatories. As a result, it was extremely burdensome and expensive for plaintiffs and their attorneys to pursue their cases.
The third wave of tobacco litigation began in the early 1990s and consisted of Class Action suits brought by those injured by tobacco products, and medical cost reimbursement suits brought by states and insurance companies. The claims in the third wave were based on proven medical theories. First, plaintiffs could demonstrate that tobacco companies knew that nicotine is pharmacologically active and highly addictive but hid that knowledge and, in fact, denied it under oath. Second, plaintiffs could show that tobacco companies manipulated nicotine levels in their products in an attempt to foster addiction in their consumers. Common legal theories used in the third wave of litigation included fraud, intentional and negligent misrepresentation, emotional distress, violation of Consumer Protection statutes, breach of express and implied warranties, strict liability, conspiracy, antitrust, negligent performance of a voluntary undertaking, Unjust Enrichment or indemnity, civil claims under the Federal racketeer influenced and corrupt organizations (rico) act (18 U.S.C.A. §§ 1961 et seq. ), and various criminal theories.
Litigation began with the certification of two class action suits (Broin v. Philip Morris, 641 So. 2d 888 [Fla. App. 3d Dist. 1994], review denied, Philip Morris Inc. v. Broin, 654 So. 2d 919 [Fla. 1995], and Castano v. American Tobacco, 84 F.3d 734 [5th Cir. 1996]). The class members in Broin were nonsmoking flight attendants who claimed that they suffered from various illnesses caused by their exposure to ETS from air travelers' cigarettes. Castano was based on plaintiffs' claims that tobacco companies intentionally manipulated nicotine levels, even though the companies knew that nicotine was a hazardous and addictive substance. The Castano class consisted of all nicotine-dependent persons or their estates, heirs, family members, or "significant others" in the United States and its territories and possessions, who have bought and smoked cigarettes manufactured by the defendants.
Because of the breadth of the class, the U.S. Court of Appeals for the Fifth Circuit ruled that the plaintiffs in Castano should not have been certified as a class; had the court allowed the case to proceed, it would likely have become the largest class action in U.S. history. After the decertification of the Castano class, plaintiffs' lawyers decided to pursue statewide class action suits in state courts around the nation.
Lawsuits since Castano have sought to eliminate the problem of certifying a large class. For example, Engle v. R. J. Reynolds, 672 So. 2d 39 [Ct. App. Fla. 3d Dist. 1996], review denied, 682 So. 2d 1100 (Fla. 1996), involved essentially the same claims as Castano, but the class was much smaller. The class certified in Engle consisted of Florida citizens and residents, and their survivors, who had suffered, presently suffer, or have died from diseases and other medical conditions caused by their addiction to cigarettes. The Engle class action was allowed to proceed, which made it the first class action lawsuit against tobacco companies to go to trial. In 2000, a six-person jury awarded the class members a record $145 billion in Punitive Damages.
A wave of state reimbursement suits began in 1994, when the state of Mississippi filed an unprecedented lawsuit on behalf of the state's taxpayers against the tobacco industry to recoup the state's share of Medicaid costs incurred as a result of tobacco-related illnesses (Moore v. American Tobacco, No. 94-1429 [Miss. Chan. Ct. 1994]). The state of Mississippi proceeded on legal theories of unjust enrichment and restitution, based on the fact that the state's taxpayers had been directly injured by the actions of the tobacco industry because they were forced to pay Medicaid costs associated with tobacco-related illnesses.
In 1994, the state of Minnesota filed a medical cost reimbursement suit, with the insurance company Blue Cross-Blue Shield of Minnesota as co-plaintiff. When West Virginia filed its medical reimbursement lawsuit, it named as defendants not only tobacco companies, but also the Kimberly-Clarke Corporation, developer of the tobacco reconstitution process that enables tobacco companies to manipulate nicotine levels. In 1995, the state of Florida filed a lawsuit against the tobacco industry under Florida's Medicaid Third-Party Liability Act, effectively preventing tobacco industry defendants from prevailing under defenses of Assumption of Risk and contributory negligence. Texas filed suit, in 1996, and brought claims based in part on the RICO Act and on theories of mail and wire fraud, antitrust violations, and public Nuisance. The state of Washington additionally sued the law firms that had represented the tobacco companies for many years, arguing that they unlawfully helped their clients keep certain documents confidential.
Eventually, the tobacco companies were forced to seek a national settlement of all state tobacco claims. In 1996, the Brooke Group and Liggett Group, two of the largest U.S. tobacco companies, settled with the states of West Virginia, Florida, Mississippi, Massachusetts, and Louisiana. This settlement was noteworthy because it represented the end of the tobacco industry's unified effort to avoid paying out monetary damages. After this settlement the major tobacco companies began intensive negotiations with all 50 state attorneys general.
By 1998, the states of Florida, Minnesota, Mississippi, and Texas had negotiated individual settlements worth billions of dollars to each state. The remaining 46 states continued to negotiate with the tobacco companies and, in November 1998, a deal was reached. The key elements of the settlement included the payment to the states of $206 billion over a 25-year period, funding to support research on programs to reduce youth smoking, limitations on advertising and sporting event sponsorship, and a ban on cartoon characters in advertising and "branded" merchandise (e.g., T-shirts). In addition, the companies agreed to disband the Tobacco Institute, the Council for Tobacco Research, and the Council for Indoor Air Research. While supposedly neutral, these groups disseminated false information about the safety of tobacco products and lobbied against increased tobacco regulation. The companies also agreed to establish a website that would contain all documents produced in state and other smoking and health-related lawsuits.
The federal government has also pursued a similar course against the tobacco industry, seeking billions of dollars in damages. The government filed suit, in 1998, asserting that smoking causes cancer and other serious illnesses. These illnesses cost the federal government $25 billion annually in health care claims. It sought to recover more than four decades' worth of expenses, plus damages. In 2001, a federal district court dismissed two of the three claims, allowing only the RICO theory of liability to move forward (United States v. Philip Morris Inc., 153 F. Supp. 2d 32 [D.D.C.2001]). By 2003, the government and the companies had not resolved the litigation and it was unclear whether a settlement might be reached.
Despite the national settlement with the states, the tobacco companies continue to defend themselves in lawsuits waged by individuals claiming health problems caused by either smoking or breathing secondhand smoke. In order to obtain the maximum benefit, plaintiffs' attorneys organize and work together. Plaintiffs also have access to new evidence obtained from internal tobacco company documents and former tobacco industry researchers to significantly bolster their cases. For example, the Minnesota Court of Appeals decided in State ex rel. Humphrey v. Philip Morris Inc., 606 N.W.2d 676 (Minn. App.2000), that tobacco company documents could be released to the public. During the initial Minnesota tobacco trial, the judge ordered the companies to release many internal documents. Since the parties settled before a verdict was reached, the tobacco companies sought to prevent public access to the documents given to the plaintiffs. The appeals court ruled that the trial court had properly examined the issues and that the documents could be released to the public. The appeals court also pointed out that many of the documents had already been disseminated publicly. The ruling cleared the way for a massive release of internal documents and indices that would aid other plaintiffs in their pending lawsuits against tobacco companies.
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