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San Francisco Sues 6 Tobacco Firms

Courts: Officials seek to recover millions spent to treat smoking- related illnesses, charging that companies violated state and federal laws. They urge other counties to join the lawsuit.

June 07, 1996|HENRY WEINSTEIN and MAURA DOLAN | TIMES LEGAL AFFAIRS WRITERS

SAN FRANCISCO — This city Thursday became the first local government in the United States to sue the tobacco industry, seeking to recover millions of dollars the city and county of San Francisco spend annually in the treatment of smoking-related illnesses.

The San Francisco city attorney's office, aided by a high-powered law firm, filed suit in U.S. District Court here, alleging that six tobacco companies and two trade associations violated state and federal laws in a 40-year conspiracy to conceal the addictive nature of their product.

"It's more than time for public officials in California to hold the tobacco industry responsible for the staggering human and financial costs of smoking," said San Francisco City Atty. Louise Renne. "If the tobacco companies are going to knowingly market a product that is going to cause illness and death, they ought to pay for it, not the taxpayers," she added, referring to federal studies estimating that cigarette smoking in the United States causes 400,000 deaths a year and numerous health problems.

"Counties in particular cannot afford their scarce public funds being drained by having to pay for the treatment of tobacco-related illness. These are funds that would be better spent on preventive health care, education and other urgent public needs," Renne added. (San Francisco is a unique governmental entity--a joint city-county and Renne is its chief legal officer.)

As soon as she filed the lawsuit, Renne moved to broaden it. On Thursday she sent letters to the chief legal officers for California's 57 other counties inviting them to join the lawsuit.

Los Angeles County Supervisor Zev Yaroslavsky said he would introduce a resolution in the near future asking that the county direct its attorneys to join the lawsuit.

"We have talked to our own health department and we believe there is ample evidence that we have incurred substantial expense because of the tobacco companies," Yaroslavsky said.

San Francisco contends that the industry violated California's fair business practices code and the federal Racketeer Influenced and Corrupt Organizations Act.

The massive lawsuit is similar to those filed by nine states in the last two years, including one lodged by Washington in a state court Wednesday. Several other states are on the verge of filing such suits. A spokesman for California Atty. Gen. Dan Lungren said the office is considering whether to file as well.

Philip Morris attorney Michael York decried the San Francisco lawsuit: "We don't believe the city of San Francisco has any more basis to file this kind of radical claim than do any of the states that have filed. We believe the cases are utterly without legal merit, particularly the RICO claim."

York emphasized that Philip Morris had announced its own proposal for federal legislation aimed at reducing smoking among youths last month and contended that if San Francisco "is truly interested in fighting youth smoking they would join Philip Morris and everyone else who wants to enact broad federal legislation instead of filing a lawsuit that under the best of circumstances will take years to resolve."

Like the state actions, the San Francisco suit asks that the cigarette companies and the trade associations be held liable for fraud and conspiracy for: falsely denying that cigarettes are addictive; for denying that the industry manipulates nicotine levels in cigarettes; for denying that smoking is harmful to health; for concealing the industry's own research findings about the dangers of smoking, and for suppressing research on "safer" cigarettes.

The suit also asks the court to order the defendants to fund corrective public education programs, to stop targeting minors in their advertising campaigns and to disclose all their research on smoking addiction and related health issues.

Lieff, Cabraser, Heimann & Bernstein, a San Francisco law firm that specializes in representing plaintiffs in complex litigation, is serving as special counsel for the city in the case on a contingency basis. Renne said the firm would receive 20% of any recovery up to $25 million and 15% of any recovery beyond that. She said that is well below the firm's normal fees and noted that because the firm would be bearing the upfront expense, the case would not result in any substantial costs for San Francisco.

Elizabeth Laporte, chief of special litigation for the San Francisco city attorney's office, said the agency had filed the suit after reviewing the issues and passage of a Board of Supervisors resolution endorsing such a suit. The resolution was signed by Mayor Willie Brown, who while he was speaker of the Assembly raised $500,000 from the tobacco industry.

Asked about Brown's previous acceptance of tobacco industry contributions, spokesman P.J. Johnston said: "It's a new day. The mayor is the leader of San Francisco, and as such he feels it is appropriate for San Francisco to enter into this lawsuit."

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