OCTOBER 25, 1999
Tobacco rolls with the punches
AN appeals court in Miami, Florida, has dealt the tobacco industry another harsh blow by ruling that tobacco companies cannot stop the jury which found them guilty of fraud and conspiracy in July, from awarding a lump sum of damages to be shared among the thousands people involved in a class action brought by sick smokers and the families of those who have died from tobacco-related diseases.
The ruling caused tobacco share prices to plummet with Philip Morris stocks losing 12% of their value.
Tobacco lawyers argued that lump sum damages could exceed $300bn and that the tobacco industry may not be able to afford to appeal again as they could be forced to post a bond covering the full amount of the damages plus the interest for the period of the appeal. They warned that a massive award for damages would "cause an "enormous amount of irreparable harm to the industry".
The tobacco companies agreed a $206bn settlement with individual US states in November last year but this does not stop individuals from taking legal action against the industry.
At the same time the World Health Organisation has launched an inquiry into what it called a "systematic and global" bid by the tobacco industry to undermine United Nations efforts to control smoking. The WHO has established a committee of independent experts to look at evidence which has come to light during the tobacco battles in the United States. The WHO is trying to get its 191 member countries to agree to a plan to restrict tobacco advertising around the world by 2003.
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