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Why the Big Tobacco verdict may go up in smoke

July 19, 2000
Web posted at: 12:22 p.m. EDT (1622 GMT)

WritLegal commentary from FindLaw's Writ
Consumer Center
Column Archive
Tobacco on Trial

(FindLaw) -- To understand the $145 billion verdict against Big Tobacco in Engle, the Florida smokers' class action lawsuit, it helps to remember President Clinton's famous assertion that he never had "sexual relations" with Monica Lewinsky.

The real issue was not whether he lied, but what to do about it as a legal -- as opposed to political -- matter. The same issue arises when our society confronts in the courtroom the lies tobacco companies have told.

Lying in itself is (still) not illegal in America. It has legal consequences only under certain circumstances. For example, many people were doubtless personally disgusted by the president's lie. But disgust alone cannot be the measure of how to treat a liar in the courtroom. This simple fact has been lost in the frenzy surrounding the tobacco lawsuits.

The Engle jury concluded that the tobacco companies were liable under two general types of theories: for making a defective product and for lying about their product. The jury's huge verdict against Big Tobacco was based on the second theory.

"It was the lies"

The first theory -- that cigarettes are inherently unsafe -- will play almost no role in this case. Aside from a few law professors, no court believes a properly made cigarette is a defective product. On the contrary, a cigarette is dangerous not because of any defect in its manufacture or design, but because it does what it was designed to do extremely effectively: deliver pleasurable, addicting and carcinogenic chemicals to the body. If the only claim against Big Tobacco had been that their product was defective, they would have nothing to worry about from the courts.

Instead, the jury's second conclusion -- that cigarette companies lied about their product -- is what killed them in Engle. This kind of claim is at the heart of every recent case Big Tobacco has lost and then hit with massive punitive damages.

Aside from a few law professors, no court believes a properly made cigarette is a defective product.

Smokers now are arguing that what harmed them was not cigarettes, but lies told by cigarette companies about smoking. Moreover, these new legal claims are packaged in the language of white-collar crime: "fraud," "misrepresentation," and "conspiracy", as if Big Tobacco's main activity was not making cigarettes, but running a real-estate scam.

The plaintiffs' lawyers guiding the cases against the cigarette companies have hit pay dirt with this new approach. It has two huge advantages over the old-fashioned products liability claim. First, it offers a quick answer to the defense argument that smokers "chose" to smoke, since free choice based on misinformation is no real choice at all.

Second, half of the case is already in the bag, since thousands of recently uncovered documents reveal that the tobacco companies spent a lot of time and money lying about both cancer and nicotine addiction. The record is very extensive and not open to multiple interpretations.

Stanley Rosenblatt, plaintiffs attorney in Engle, focused on the lies, and the jury followed his lead. As the New York Times put it after interviewing the jury, "It was the lies."

Intentional tort versus product liability

By turning the case against Big Tobacco into one about lying, Rosenblatt also made a very shrewd tactical move. If the jury accepted his theory that smokers were the victims of an intentional tort, and not simply a defective product, he could legally focus much of his discovery and cross-examination on events revealing the tobacco companies' motives and attitudes.

Thus, Rosenblatt's trial strategy was to explore in great detail the tobacco companies' paranoid, almost Nixonian, attitude towards the outside world: their secret meetings, coordinated press releases and phony scientific institutes.

This type of evidence can, and did, inspire a huge punitive damages verdict. But in law, as in life, everything easy comes at a price. Turning the case into one about lying imposed new burdens that, had Judge Robert Paul Kaye followed the law, should have made it very difficult for Rosenblatt to prevail.

Just because the industry continued to lie does not prove anyone believed them or, more important, that even if the lies were taken seriously, in the end, they affected what people did -- the legal definition of "reliance."

In law, a liar is liable in tort only if his victim relies on his lie. If I sell you a car with old brakes and tell you they are new, you can't sue me in tort if you discovered the brakes were old before purchasing the car. You can only sue me if you relied on my deceit.

Without such reliance, I may be a bad person, but I'm not a tortfeasor. Even though I lied to you, you bought the car knowing the brakes were old, so any resulting damage is ultimately your fault, not mine. That's because you didn't rely on my lie; instead, you found out the truth for yourself.

Smoke and mirrors

So the question at the heart of the deceit theory in Engle, is whether the plaintiffs relied on the lies of the tobacco companies. If not, they should be denouncing Big Tobacco in church, not the courtroom.

How hard would it have been for Rosenblatt to prove reliance on the lies? With all due respect to the tobacco industry, they were inept liars. One of Rosenblatt's central claims is that the tobacco companies, through pseudo-scientific research, lied to the public about the addictiveness of cigarettes.

But cigarettes have been considered a "habit" that was difficult to break for most of this century. A smoker who believed that she could stop smoking easily probably did not base her views on what scientists were saying.

Therefore, a fraudulent "scientific" study by the Tobacco Institute distributed to health officials and the press (who had dismissed it on arrival) would not be a likely contributor to her belief that smoking was not addictive.

The industry's lies about the link between tobacco and cancer probably permeated the information available to the general public more than their lies about addictiveness, but here the question of reliance becomes even trickier.

By 1964, the U.S. government had announced, in effect, that Big Tobacco was lying about the link between smoking and cancer. The credibility of the industry sank through the 1970s and 1980s until their denials became a standing joke.

Fraud requires reliance and one cannot prove reliance without asking about what a specific plaintiff knew and when he or she knew it.

Just because the industry continued to lie does not prove anyone believed them, or, more important, that even if the lies were taken seriously, in the end, they affected what people did -- the legal definition of "reliance."

Then how did Rosenblatt get around the reliance problem? The class action structure, which turns the legal question of fraud into a moral abstract, suited his purposes.

He wanted to avoid, as much as possible, confronting the difficult factual question of how many smokers were led to smoking by Big Tobacco's lies. The class action mechanism helped him do exactly that. Judge Kaye obliged Rosenblatt by structuring the trial so that the crucial requirement that the plaintiff prove reliance in a fraud case was diminished.

During the first phase of the trial, the jury was asked to determine whether or not the cigarette industry had committed fraud without the benefit of hearing the case of an actual victim.

Fraud requires reliance and one cannot prove reliance without asking about what a specific plaintiff knew and when he or she knew it. That is why the verdict in Engle will likely be overturned on appeal.

I am not arguing that it is inconceivable that through fraud, a cigarette company caused some harm to someone. The problem is this: the millions of dollars spent by Big Tobacco to lie about cancer and addiction probably are not the only cause --or even the main cause -- of the widespread societal choice to smoke.

If Rosenblatt wants to sue for fraud, he will have to prove his claim smoker by smoker.

Why people choose to smoke -- and why many cannot stop -- is a complex problem. To attribute exclusively to Big Tobacco's lies the power to erase what medical science and common sense have told us for over 50 years strains credulity.

It requires that we view the world as a place where corporate speech is taken as gospel and all other forms of social and cultural influence are irrelevant. This is an oversimplified picture that few of us would accept willingly. We shouldn't accept it now just to win a lawsuit.


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