Monday, September 05, 2005

Tobacco-Free Kids and Five Other Health Groups Request Huge Monetary Remedies in DOJ Case: POST 2 - Public Education and Counter-Marketing Campaign

Six public health and anti-smoking organizations last week submitted a post-trial brief in the DOJ lawsuit, requesting a series of remedies to address the alleged RICO violations of the tobacco company and defending these remedies as being consistent with the D.C. Court of Appeals' decision that disallowed disgorgement of past profits as a remedy in the case.

The six organizations (hereafter referred to as the interveners) - the Tobacco-Free Kids Action Fund, the American Cancer Society, the American Heart Association, the American Lung Association, Americans for Nonsmokers' Rights, and the National African American Tobacco Prevention Network - proposed three massive monetary remedies, similar to, but in some cases, more costly than proposed by the Department of Justice in its post-trial brief.

This is the second of a series of 3 posts that will provide a commentary on the brief in terms of its arguments supporting each of the 3 major monetary remedies requested: (1) a national smoking cessation program; (2) a public education and counter-marketing campaign; and (3) penalties for failure to meet youth smoking prevalence reduction targets.

This post will address the second of these remedies: the requirement that the tobacco companies fund a national public education and counter-marketing program.

2. PUBLIC EDUCATION AND COUNTER-MARKETING CAMPAIGN

The education and counter-marketing campaign requested by the interveners is similar to that proposed by the government, but is more expensive ($600 million annually instead of $400 million) and of greater duration (instead of just 10 years, the program would continue for at least 10 years, but longer if youth tobacco use does not decline to 5% or if less than 90% of the public fails to "fully understand the comparative health risks of different health products" or if less than 90% of the public fails to be "fully informed of the disease risks and other harms associated with exposure to secondhand smoke").

The rationale given by the interveners for the public education and counter-marketing campaign is that this remedy will "create disincentives that will prevent and restrain future RICO violations." The program will continue until youth smoking prevalence drops to 5%, so "any future actions of the defendants that result in more youth smoking will result in increased costs to the defendants and a longer duration of the program." In addition, the interveners argue that the program will "undermine the impact of industry youth marketing efforts - making those efforts less financially beneficial to defendants - and will also shrink the pool of likely youth smokers, thereby depriving the defendants of the customer base that would be the subject of any such violations."

The program would contain 3 elements:

A) A youth smoking prevention campaign: This element of the overall campaign would continue for at least 10 years, but for longer if youth smoking prevalence fails to decline to 5% or lower. The program would continue until this target is reached.

The rationale for this aspect of the program is that it would eliminate the incentive for tobacco companies to market to youths because it would "inoculate" them "from the defendants' deceptive and unlawful youth marketing and other misleading messages regarding tobacco use."

B) An education campaign regarding the risks of various tobacco products, including low-tar, light, etc.: This element of the campaign would continue until at least 90% of the public "are fully informed concerning the comparative health risks, including addictiveness, among different tobacco products" (but for no less than 10 years).

The rationale for this aspect of the program is that it would undo "the damage from the defendants' creation of a health-related 'controversy' where none actually existed, and it would "counteract the defendants' misleading and fraudulent marketing and messages and thereby divest or restrain the defendants."

C) A campaign focused on the health effects of secondhand smoke: This element of the campaign would continue until 90% of the public is "fully informed of the disease risks and other harms associated with exposure to secondhand smoke" (but for no less than 10 years).

The rationale for this aspect of the program is that it will serve as a "divestiture or restraining device." The interveners argue that it will serve a divestiture function by inducing smokers to quit (as concerns about harm to others has been found to be a factor that motivates some smokers to quit). The interveners fail to spell out how this element will serve a restraining function, but presumably they intended to argue that it would eliminate the incentive for defendants to commit future RICO violations in this area because if the public is already educated about the effects of secondhand smoke, then there is no incentive for the companies to continue to deceive the public about these effects.

The Rest of the Story

I have already addressed the interveners' argument that this proposed remedy is allowable under RICO because it would prevent and restrain future RICO violations by "separating the RICO criminal from the enterprise so that he cannot commit violations in the future." This argument, I believe, is such a wild interpretation of the statute that the Court is unlikely to even consider it. But if it does, I believe it will not find it to be compelling because the remedy would not, in fact, separate the industry sufficiently from the enterprise so that it cannot commit violations in the future.

As to the argument that this proposed remedy would prevent and restrain future RICO violations, let's first address the general argument, then deal with each specific element.

In general, the argument that a public education and counter-marketing campaign would educate and "inoculate" the public so that people are not susceptible to fraudulent or deceptive tobacco industry public relations or marketing efforts (and thus eliminate any incentive to commit future RICO violations) is not one that I find compelling.

The reason is that I think the exact opposite is the case. The more effective and more intensive a public education and counter-marketing program that takes place, the more aggressive and more intensive the tobacco companies will have to be in their own marketing and public relations efforts in order to counteract the national campaign and retain its customer base. Thus, rather than create an incentive not to commit RICO violations, I think this remedy would actually create a strong incentive for the industry to commit not only continuing violations, but to become more intensive and more aggressive in such violations.

The only way in which an education and counter-marketing campaign could eliminate the incentive for companies to commit future RICO violations (i.e., to stop marketing to youths and to stop misleading the public about the health risks and addictiveness of cigarettes) would be if it completely immunized the population from the effects of tobacco industry marketing and public relations activities. But that is impossible, or at least I am not aware of any such program.

For a program that is less than perfect, it will inevitably leave some members of the population susceptible to cigarette marketing, even if somewhat less susceptible than before. To reach these people, the cigarette companies will have to be even more effective in their marketing; thus, the incentive to commit RICO violations increases, rather than decreases.

I do not think it is a credible argument to assert that any public education and counter-marketing campaign could immunize youths so that they are not susceptible to cigarette marketing, immunize smokers so that they are not susceptible to campaigns that distort the true health risks of various tobacco products, or to immunize the public so that it is not susceptible to campaigns that distort the true health risks of secondhand smoke. But that is exactly the assertion that the interveners need to rely on in order to defend their argument that the public education and counter-marketing campaign will eliminate incentives for companies to commit future RICO violations.

Now we can address each specific element of the proposed program:

A) A youth smoking prevention campaign: The argument supporting this remedy fails for two major reasons. First, it is a fantasy to believe that there is any public education and counter-marketing program that could inoculate youths so that they are not susceptible to deceptive youth marketing and misleading messages regarding tobacco use. At least some youths would remain susceptible, or a large number of youths would remain susceptible to some degree, creating a strong incentive for tobacco companies to become more aggressive and intensive in their deceptive marketing and public relations practices.

Second, the remedy as proposed (funding the program until youth smoking prevalence drops below 5%) is remotely tied to continued RICO violations. Cigarette companies could cease immediately from committing any RICO violations, and one might reasonably not expect youth smoking to drop below 5%. There are so many other factors that affect youth smoking, other than the alleged RICO violations, that youth smoking prevalence could easily fail to drop below 5% even in the complete absence of any deceptive youth marketing or misleading public relations statements by the tobacco companies.

It hardly seems fair to the cigarette companies to put the burden of lowering youth smoking prevalence on them, when in fact they will have satisfied the dictates of the RICO law if they simply cease RICO violations. But doing so would not, in my opinion, be expected to bring youth smoking prevalence down below 5%. Certainly youth smoking would be expected to decrease a little, but I don't think it is reasonable to expect it to fall as low as 5%.

At any rate, the connection between youth smoking prevalence and RICO violations is so remote that this remedy will never see the light of day. Nor should it. It is simply not an appropriate RICO remedy.

In reality, setting the 5% youth smoking prevalence target actually creates a strong incentive for companies to bombard youths with deceptive marketing. Because it is virtually impossible for this goal to be reached, cigarette companies would logically conclude that there is no sense in ceasing and desisting from RICO violations. If they are going to have to pay the penalty anyway, then they might as well at least be committing the RICO violations for which they are paying.

It is interesting to note that the interveners were so quick to attack DOJ for weakening its proposed remedies, but in adding this component of the proposed program (tying the program to a youth smoking prevalence target of 5%), the interveners have completely destroyed the proposed remedy. Even if it was effective at creating an incentive to deter future RICO violations, tying it to youth smoking prevalence makes it inappropriate as a RICO remedy.

B) An education campaign regarding the risks of various tobacco products, including low-tar, light, etc.: The argument supporting this remedy also fails for the same two reasons. First, it is impossible to imagine any program that would inoculate the public so that they would not be at all susceptible to misleading tobacco industry information about the comparative health risks, including addictiveness, among different tobacco products. But since it would become more difficult to mislead smokers, the companies would have to become more aggressive in order to maintain their customer base.

And second, there is an extremely remote connection between continued RICO violations and the
proportion of the population that is "fully informed concerning the comparative health risks, including addictiveness, among different tobacco products." Alleged RICO violations are just one of many factors affecting public knowledge about the comparative health risks of tobacco products.

Moreover, how does one measure the proportion of the population that is "fully informed?" What exactly does that mean? There is no well-understood definition for "fully informed," and this remedy simply creates a mess for the Court, one which I dare to think it would not impose upon itself.

Finally, it seems impossible to reach a level at which 90% of the public is "fully informed" about comparative health risks of different tobacco products (many tobacco control practitioners in my field are not fully aware of some of the differential health risks), so I think this remedy would actually encourage the companies to commit future RICO violations, since they are going to be paying for the program regardless of whether they commit them or not.

C) A campaign focused on the health effects of secondhand smoke: The interveners defense of this element of the campaign fails for the same two reasons. It hardly seems that any program could result in 90% of the public being "fully informed of the disease risks and other harms associated with exposure to secondhand smoke." The cigarette companies would likely conclude that this limit cannot be reached, and would therefore have an incentive to commit RICO violations, since they would be paying for them anyway. Again, the proportion of the public who is "fully informed" of the risks of secondhand smoke is dependent upon a large number of variables, of which continued RICO violations is just one. The two are simply too remotely connected to justify this as a RICO remedy. And finally, it is impossible to measure the proposed outcome because there is no definition for "fully informed." No court is going to want to tackle with this one.

The rest of the story reveals that the interveners defense of their proposed public education and counter-marketing remedy is extremely weak. The argument is full of holes and the reality seems to be that the likely effect of the proposed remedy would be the opposite of what interveners posit - it would likely increase, not decrease the incentive for cigarette companies to continue RICO violations.

But most disturbing is that by mucking with the remedies that DOJ proposed, the interveners have actually destroyed them as potential remedies, even if by some fluke, Judge Kessler were to be compelled by the argument that they would in fact prevent and restrain future RICO violations.

The interveners have turned legal remedies into a public health policy forum, using the legal system to try to advance public policies that they wish to see implemented. In doing so, these anti-smoking groups have made a mockery of the judicial process, displayed their lack of understanding of the legal issues in the case, and greatly harmed the interests of the public's health by putting their own agenda ahead of the responsibility, as interveners in the case, to represent the interests of the public by presenting to the Court reasonable and appropriate legal remedies to prevent future RICO violations by the tobacco companies.

6 comments:

Anonymous said...

Not only have these health groups shown themselves to be ignorant of the legal underpinnings of this case, and not only have they proven themselves to be "all about the money" by asking for the same huge sums of money that the gov't already rejected as untenable, they've just HELPED Tobacco with their ridiculous request.

By claiming political interference by the top level of the Justice Department/Bush administration (a claim already shown to be dubious elsewhere in this blog) the anti-tobacco groups had created a fig-leaf for themselves to hide behind. An "excuse" for a poor outcome in this case: The pro-tobacco Republicans/Bush killed the case.

In her order granted these groups status as intervenors, Judge Kessler explicitly told them that they had to ask for *permissible* remedies. That was a clear reference to the DCCA standard.

Now when all of the DOJ and health group remedy requests get tossed out as legally untenable, most likely up front by Judge Kessler, but alternatively later on appeal by the DC circuit appeals court, the Health groups can no longer claim (albeit dubiously) that the remedies were sabotaged by the Bush administration.

Since they have had the chance to participate, when *their* remedies are also tossed out, they will have no-one to blame but themselves.

Bill Godshall said...

After urging the intervenors to propose as remedies two new large warnings on cigarette packs (indicating that light cigarettes are as hazardous as other cigarettes, and that cigarettes shouldn't be smoked indoors or near others because secondhand smoke is hazardous), I'm perplexed why the intervenors rejected those recommendations, and instead proposed as remedies more funding for educational programs about light cigarettes and secondhand smoke.

Requiring new large warnings on cigarette packs would have complied with the DCCA ruling on remedies, but funding for new educational programs might not be found in compliance with the DCCA ruling.

Cantiloper said...

Bill Godshall wrote: "I'm perplexed why the intervenors rejected those recommendations (pack warnings), and instead proposed as remedies more funding for educational programs about light cigarettes and secondhand smoke."

There's an easy Bill. You may not get any money for your work on promoting smoking bans and such, but there are a lot of greedy people out there who DO get paid for such work and they want the money that those programs will siphon from smokers' pockets.

If you go to

http://www.forces.org/writers/kjono/pdf/repacinv.pdf

you'll find a receipt for a "consultation fee" from the Antismokers in Tacoma-Pierce WA to Mr. James Repace, the man who claims that sitting in a wide open room in the middle of Hurricane Katrina would still expose you to dangerous levels of secondary smoke. Mr. Repace's compensation? A mere $5,000 for what was probably 30 minutes of testimony. Of course if that wasn't enough to make him comfortable I believe the Robert Wood Johnson Foundation was also paying him $100,000 a year already for doing this stuff. Can you spell double-dipping?

Michael J. McFadden
Author of Dissecting Antismokers' Brains
http://cantiloper.tripod.com

Anonymous said...

Those of you who are interested in scientific and engineering arguments on how much ventilation is required to control secondhand smoke as opposed to ad hominem nonsense should consult: Repace JL. Controlling Tobacco Smoke Pollution. Technical Feature, ASHRAE IAQ Applications: 6, #3, 11-15 (2005). And in the interest of full disclosure, the "Antismokers" referred to by Mr. McFadden were the Tacoma-Pierce Health Department.

Michael J. McFadden said...

Anonymous wrote: "And in the interest of full disclosure, the "Antismokers" referred to by Mr. McFadden were the Tacoma-Pierce Health Department. "

Quite true. I was not intending anything by not mentioning them specifically. If indeed they were a "neutral body" in the matter as opposed to being "Antismokers," did they pay folks on the other side of the question similar sums for testimonies? Not that I'm aware of, but perhaps you know more than I do. Assuming the half hour figure is correct (I'm basing that on a memory of Mr. Repace's "not having time" to present his $1,000 Power Point presentation disk) that would be $10,000 an hour.

Hey, I'd work for a tenth of that!

;>
Michael

Michael J. McFadden
Author of "Dissecting Antismokers' Brains"
http://cantiloper.tripod.com

Bill Godshall said...

In response to Michael McFadden, the "Intervenors" cleary desire more informative warnings on cigarette packs, as the FDA tobacco legislation (advocated by Philip Morris, CTFK, ACS, AHA, ALA) would require additional and larger warnings.

Rather, the Intervenors appear to be so interested in getting the PM supported FDA legislation enacted that they chose not to request (as a remedy in the DOJ case) additional pack warnings.