Monday, October 17, 2005

Supreme Court Will Not Review DOJ Tobacco Case

The Supreme Court announced today that it will not accept the Department of Justice's request to review the D.C. Court of Appeals decision that disallowed disgorgement as a civil remedy in the tobacco litigation.

As noted by the Tobacco Products Liability Project, this decision is not entirely unexpected, as it is somewhat unusual for the Supreme Court to accept interlocutory appeals - i.e., those which are made before trial proceedings are concluded. In this case, since a decision has not been issued on whether the cigarette companies are liable under RICO in the first place, it is very possible that the Supreme Court did not want to start grappling with the issue of allowable remedies, since that could be a completely moot point if the companies are not found liable in the first place.

After the trial has been concluded and a decision issued, it is still possible for the Department of Justice to then appeal the remedies part of the case, assuming that Judge Kessler does find the tobacco companies liable for RICO violations. For now, however, this decision clears the way for a District Court decision that must be made under the Court of Appeals' interpretation of the RICO law.

In response to the decision, the Public Health Intervenors issued a press release stating: "Despite this decision, the government and the judge have a wide range of remedies available to prevent and restrain future industry wrongdoing. These include requiring the tobacco companies to pay tens of billions of dollars to fund smoking cessation and public education campaigns. Other remedies include financial penalties if the tobacco companies continue to addict children..."

The Rest of the Story

In contrast to the public health intervenors in the case, I do not believe that there are still viable monetary remedies in the case. I will not reiterate my arguments here, but will simply refer readers to my posts on this issue:

Post 2

Post 4

Post 6

Post 8

While this story is being reported as being good news for the tobacco companies, I really don't find it to be all that significant. First, only an interlocutory appeal was rejected. Should the companies be found liable for RICO violations, then the government can appeal the remedies part of the decision to the Supreme Court and it is still possible that the Court might agree to review the case at that point.

Second, I find the D.C. Court of Appeals decision to be very clear and well-argued based on the statute, which I also find to be quite clear, and so I don't think there is much of a chance, if any, that the Supreme Court would overturn the appellate court decision anyway.

If anything, the time for celebration for the tobacco companies was, in my opinion, back during this spring and summer, when the DOJ failed to appropriately tailor its remedies to be consistent with the D.C. appellate court's decision and when the Public Health Intervenors made a mockery of the whole case by attacking the Department for tailoring its remedies to be more consistent with the appellate court ruling and then went on to propose its own remedies that were wildly inconsistent with that ruling.

That the case became a public health free-for-all among every group under the sun that is trying to use the case to obtain money for its causes is the real cause for celebration among the tobacco companies.

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