Tobacco Industry

Defensive, Though Profitable

The tobacco industry has been on the defensive (though profitably) since then. The tobacco industry was also successfully sued by the U.S. Department of Justice for engaging in a 30-year criminal conspiracy to hide information concerning the link between smoking and cancer from the public. In 1965, Congress passed the Federal Cigarette Labeling and Advertising Act requiring the surgeon general's warnings on all cigarette packages. In 1971, all broadcast advertising was banned. In 1990, smoking was banned on all interstate buses and all domestic airline flights lasting six hours or less. In 1994, Mississippi filed the first of 22 state lawsuits seeking to recoup millions of dollars from tobacco companies for smokers' Medicaid bills. And in 1995, President Bill Clinton announced plans to regulate tobacco, especially sales and advertising aimed at minors.

For decades, lawsuits from consumers went nowhere. Tobacco companies, with multiple resources for legal maneuvering, easily defeated early suits, including the first one filed in 1954. Their most serious challenge before the 1990s came in 1983, when Rose Cipollone, a smoker suffering from terminal lung cancer, filed suit against Liggett, charging the company failed to warn her about the dangers of smoking. Cipollone, who did die from smoking effects, initially was awarded a $400,000 judgment, which was later overturned. Cipollone's family was unable to afford the cost of litigation, and abandoned the suit.

Into the 21st century, “big tobacco” faces a new legal environment. Over the past three decades, the law has changed considerably. State laws and legal[Page 810] precedents hold manufacturers more liable for the effects of their products. And the old legal defense of “contributing negligence”—which prevented lawsuits by people with some measure of responsibility for their own condition—is no longer viable in most jurisdictions. Instead, a defendant can be held partially liable and forced to pay a corresponding percentage of damages. Finally, the notion of “strict” liability has developed; this means defendants can be found liable whether or not they are found negligent. If a product such as tobacco causes harm, the company that produced it can be held responsible, even if it wasn't aware of the potential danger.

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