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The legal options of foreign governments seeking to hold tobacco companies responsible for the costs of treating sick smokers are quickly narrowing. The latest constriction came from Florida’s 3rd District Court of Appeal, which effectively closed the state’s courts to such lawsuits. In affirming the dismissal of a case brought by Venezuela in Miami-Dade Circuit Court, the appeals court apparently undercut more than 20 other suits brought by foreign governments seeking repayment from tobacco companies such as Philip Morris, Brown & Williamson and Lorillard. The 3rd District Court of Appeal dismissed Venezuela’s case on the grounds that its claims were too remote and indirect. The court held that, if there was harm, it was not the country that was damaged. Other foreign governments that filed suit in Miami-Dade Circuit Court with similar claims include Honduras, Tajikistan, the Russian Federation and several states in Brazil. Joel S. Perwin, a partner with Podhurst, Orseck, Josefsberg, Eaton, Meadow, Olin & Perwin in Miami, which filed the suits in Miami-Dade Circuit Court on behalf of the foreign governments, said his clients will appeal to the Florida Supreme Court. But getting review before the high court will be no small task. Unlike most states, the Florida Supreme Court does not have the power to hear any case it chooses. Appeals instead must meet specific standards. In this case, Perwin said, he must demonstrate that there is conflict between the 3rd District Court of Appeal ruling and another district court of appeal. The tobacco companies underplayed Perwin’s prospect of success. “Federal courts in this country have uniformly rejected such lawsuits. Because similar rules apply regardless of where these cases are filed or who files them, these cases should be dismissed whether they are filed in state or federal court,” said William S. Ohlemeyer, vice president and general counsel of Philip Morris. In oral argument before the 3rd District Court of Appeal, Perwin argued on behalf of Venezuela and Stephen N. Zack, of Boies, Schiller & Flexner in Miami, argued for the tobacco companies. Zack did not return telephone calls for comment. The court of appeal affirmed a ruling in November 2001 by Miami-Dade Circuit Court Judge Bernard S. Shapiro in which he dismissed the case on the grounds of remoteness. The three District Court of Appeal judges were Alan R. Schwartz, David M. Gersten and Rodolfo Sorondo Jr. Sorondo has since gone into private practice. The panel’s decision was handed down Sept. 30. The foreign governments were trying to follow the success of U.S. states such as Mississippi and Florida, which sued tobacco companies in the late ’90s to recover money spent treating sick smokers. In November 1998, tobacco companies settled claims by 46 states and agreed to pay more than $200 billion to those states for the next 25 years. But, unlike the state lawsuits, foreign governments have received a hostile reception in U.S. courts. Last year, the U.S. Court of Appeals for the D.C. Circuit dismissed claims made under federal law by Guatemala, Nicaragua and the Ukraine. Because the foreign government cases were sent to the D.C. Circuit under federal multidistrict litigation rules, the decision effectively closed the federal courts to foreign governments. Now the doors of Florida’s courthouses appear to be closing as well. When asked if this ruling kills the entire line of legal attack by foreign governments against tobacco companies, Richard A. Daynard, director of the Tobacco Control Resource Center in Boston and a tobacco industry foe, said, “I think it does.” Just three foreign government cases remain in two state courts — Texas and Louisiana, according to Kenneth Parsigian, a partner with Goodwin Procter in Boston who has led the tobacco defense in Florida. The 3rd District Court of Appeal ruling centered on the legal doctrine of remoteness. The doctrine says that a plaintiff cannot sue for harm inflicted on a third party, but must establish direct damages. “Simply, the government of Venezuela does not have a direct independent cause of action against the tobacco companies to recover for smoking-related medical expenses incurred by its citizens,” the 3rd District Court of Appeal held. But Perwin insisted there is direct harm. “Venezuela was victimized by a worldwide conspiracy by tobacco companies to suppress the truth about nicotine,” Perwin said. “Had Venezuela known the truth, it would have acted to limit importation or taken steps to curb smoking.” Parsigian responded with the tobacco industry’s classic defense. He said that the foreign governments were not misled, because the U.S. Surgeon General’s report in 1964, which outlined the health dangers in smoking, was widely published. But what is perhaps most frustrating for Perwin and the foreign governments is that their claims largely mirror those successfully brought by the states. While some states, like Florida, enacted legislation to get around the legal defense of remoteness, many other states did not. Nevertheless, courts let the lawsuits go forward. “Courts have had a hostility to these lawsuits,” Daynard said. Indeed, the 3rd District Court of Appeal signaled its distaste for the lawsuits brought by foreign governments against the tobacco industry. It wrote in an opinion that it “is inappropriate for Venezuela to attempt to turn Miami-Dade County into the ‘courthouse for the world.’”

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