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The tobacco industry may not accuse the U.S. government of being the pot that calls the kettle black in a high-stakes trial set to begin in September, a federal judge has ruled. At least that’s one way to characterize the ruling by Judge Gladys Kessler of the U.S. District Court for the District of Columbia. To be more precise, she denied an industry request that it be allowed to plead equitable defenses against the United States. Lawyers for the tobacco industry argued that the government’s complicity in the very acts-such as conspiracy to deceive the public-for which it now seeks to hold Big Tobacco liable gives the industry the right to plead the defenses of waiver, equitable estoppel, laches, unclean hands and in pari delicto. In essence, those traditional defenses assert that the person who prosecutes a lawsuit is himself guilty of wrongdoing or neglect. In her 27-page opinion, Kessler said that even if the charge of complicity were true, the doctrine of sovereign immunity precludes equitable defenses from being pleaded against the government: “The United States brings its . . . claims in its capacity as sovereign, acting on behalf of the public to vindicate public rights,” she wrote. “The Supreme Court has stated that any waiver of such sovereign authority must be unmistakable . . . yet the Defendants have not pointed to anything in the record that constitutes an unmistakable waiver of the Government’s right to pursue these claims.” U.S. v. Philip Morris Inc., No. 99-2496. $289 billion The lawsuit, which was filed in 1999, accuses five tobacco companies, the Council for Tobacco Research and the Tobacco Institute of a decades-long conspiracy to deceive the American public by denying the health risks of smoking, withholding evidence that contradicted those denials, manipulating cigarettes to make them more addictive and falsely telling consumers that “light” cigarettes were less harmful than alternatives. Under the Racketeer Influenced and Corrupt Organizations Act, the government seeks a whopping $289 billion, a figure that is alleged to reflect the industry’s gains from its illegal conspiracy. The industry contended that the government itself has known of smoking risks for decades, that it maintained that nicotine was not addictive until 1988, that a method of reporting tar and nicotine that the government now says was fraudulent was in fact mandated by the government, and that the government itself encouraged smokers to switch to light cigarettes, among other charges. Edward L. Sweda Jr., senior attorney at the Tobacco Products Liability Project, said, “Those claims by the tobacco industry were made in bad faith.” The project, which is affiliated with the Northeastern University School of Law “works to establish the legal responsibility of the tobacco industry for tobacco-induced disease, death and disability,” according to its Web site. “Most of what the industry knew was not shared with the government,” Sweda said. He said the surgeon general’s office could have warned of the addictiveness of nicotine as early as its landmark 1964 report on the dangers of smoking if it had been aware of a 1963 memorandum by a Brown & Williamson attorney that stated, “We are in the business of selling nicotine, an addictive drug.” In addition, Sweda faults the tobacco companies’ briefs for being “absolutely silent about their own efforts to lobby the government to do the things that it accuses the government of doing.” An attorney for R.J. Reynolds Tobacco Co., Peter J. Biersteker of the Washington office of Jones Day, said in an e-mail message that Kessler’s ruling “while disappointing, was not surprising.” Biersteker added that while the industry may not be able to put the government’s complicity before the court in formal defenses, “evidence relating to the Government’s conduct is still admissible for other reasons,” such as for showing that the industry’s actions were “a rational competitive response to Government action” and for determining damages if the industry is found liable. Finally, he said that the industry still has arrows in its quiver, pointing to pending motions that would undercut key elements of the government’s case. Young’s e-mail address is [email protected].

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