10 June, 2005  15:45 GMT
Federal prosecutors on Thursday defended their decision to downsize dramatically a proposed penalty against Big Tobacco, saying they tried to put the focus on future smokers who might become hooked if cigarette makers continue their alleged racketeering.
As closing arguments ended in the nearly nine-month trial, lawyers for the tobacco companies dismissed the Justice Department's position as a last-minute attempt to put a better face on a losing proposition.
"The plaintiff's case is disappearing, and this is a desperate effort to stop the fall," said Brown & Williamson lawyer David Bernick.
Still incensed a day after asking the Justice Department's internal investigator to look into whether political interference affected the downsizing decision, Reps. Henry Waxman, D-Calif., and Martin Meehan, D-Mass., asked for an expansion of that investigation.
The congressmen questioned whether political appointees at the agency have connections with the tobacco industry and whether prosecutors asked one of their witnesses -- Matthew Myers, president of the Campaign for Tobacco-Free Kids -- to tone down his testimony.
Decades-Long Conspiracy
Federal prosecutors this week told US District Judge Gladys Kessler that they were seeking a $10 billion, five-year nationwide smoking cessation program as a penalty against the industry for a decades-long conspiracy to deceive the public about the health risks of smoking. That proposal was a fraction of the $130 billion, 25-year program suggested by government witness Michael C. Fiore, a University of Wisconsin medical professor.
On Thursday, Philip Morris lawyer Dan Webb called that decision the "Dr. Fiore flip-flop."
Unlike Fiore's proposal, the $10 billion program would be limited to a certain number of people -- decided by estimating how many smokers may become hooked as a result of any misbehavior by the companies within a year after the trial.
However, Associate Attorney General Robert McCallum told reporters outside the courtroom that the program's services would be open to any of the 45 million smokers in the United States, not just future smokers.
The program could be extended or expanded should cigarette makers continue to misbehave, government lawyer Sharon Eubanks argued.
'The Most Appropriate Strategy'
In February, an appeals court barred the Justice Department from seeking $280 billion in allegedly ill-gotten tobacco profits, saying the law required "forward-looking" remedies. Fiore's proposal was the next most-expensive proposal mentioned in the trial, which started in September.
McCallum resisted the idea that political appointees at the Justice Department had sought to reduce Fiore's proposal, saying they had worked with career employees "to devise the most appropriate strategy."
Myers said government lawyers called him saying "they were uncomfortable" with his recommendations, though they had worked closely together. He said he declined to tone down his testimony, which included a comparison of the 1998 settlement that cigarette makers reached with states and a failed 1997 agreement that would have restricted industry activities. Most of his testimony was eventually thrown out.
Justice Department spokesman Eric Holland said lawyers had asked him to narrow certain proposals because they might have raised First Amendment issues.
Fleshing out a previous request for the court-appointed monitor to watch over the companies, Eubanks also suggested the monitor could hire a staff, police the companies, make recommendations for structural changes, and function as a hearing officer if necessary.
Tobacco companies protested that such details had never been mentioned before.
"This is unfolding as we speak," Webb said.
Changed Their Behavior
In closing arguments, the tobacco companies argued the government never proved its claims and that the racketeering statute restricts what Kessler will be allowed to do. In addition, they said the companies have radically changed their behavior in recent years.
"The mammoth, nine-month trial has really been rendered moot by the passage of time," said Philip Morris lawyer Ted Wells.
The defendants in the lawsuit are Philip Morris USA Inc. and its parent, Altria Group Inc.; R.J. Reynolds Tobacco Co.; Brown & Williamson Tobacco Co.; British American Tobacco Ltd.; Lorillard Tobacco Co.; Liggett Group Inc.; Counsel for Tobacco Research-U.S.A.; and the Tobacco Institute.
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