On November 23, 1998, the nation’s four largest tobacco companies agreed to pay forty-six states a total of $206 billion and adhere to advertising and marketing restrictions in a negotiated deal that turned out to be the largest civil lawsuit settlement in history. This settlement was a result of dozens of suits filed against the tobacco industry in the 1990s by state attorneys general attempting to recover the health care costs of treating smoking-related illnesses. In many ways, this 1998 settlement was also the outcome of a decades-long effort on the part of public health advocates, antismoking activists, and legislators to regulate tobacco and reduce smoking. Since the U.S. Surgeon General first declared smoking a health risk in 1964, many physicians and public health experts have been involved in a broad campaign against cigarette consumption. The tobacco industry, however, along with many smokers and others who believe that antitobacco activism misdirects national priorities, have actively opposed this antismoking drive.
Many private and governmental factions have condemned smoking as a health risk since the 1964 Surgeon General’s report on smoking and health linked smoking to cancer. Medical experts, antismoking activists, and lawmakers have worked to pass a variety of regulations designed to reduce smoking. Some efforts have focused on the labeling of cigarette packages and on cigarette advertising. The first labeling law, the Cigarette Labeling and Advertising Act, took effect in 1966. It required cigarette packages and advertisements to warn that cigarette smoking “may be hazardous to your health.” Another early legislative restriction was the 1969 Public Health Cigarette Smoking Act, which banned cigarette advertising on television and radio, leaving the tobacco industry only the print media and billboards on which to advertise. In 1970, the Supreme Court upheld this ban in the face of a challenge by the tobacco industry. The cigarette package warning label was also strengthened to read, “Warning: The Surgeon General has determined that cigarette smoking is dangerous to your health.” In 1984, the Comprehensive Smoking Education Act required the use of several different warning labels, which are rotated sequentially.
Government agencies also began to ban smoking in public spaces. In 1973, the Civil Aeronautics Board began requiring commercial airlines to offer nonsmoking sections. Later, smoking was banned on domestic flights of under two hours; and, in 1990, it was banned on all domestic flights of six hours or less. Also in 1973, Arizona became the first state to prohibit smoking in some public places. Several other states followed suit; and, in 1987, the Department of Health and Human Services, a federal agency, started banning smoking in its offices. In 1993, the Environmental Protection Agency (EPA) released a report that linked environmental, or secondhand, tobacco smoke with cancer and other diseases among nonsmokers. The EPA report provided the necessary grounds for some legislators to propose a ban on smoking in most nonresidential buildings. As a result, in 1998, California became the first state in the nation to ban cigarette smoking in bars, private clubs, and card clubs. Smoking had been prohibited in California restaurants and indoor workplaces since 1995; with the 1998 law, nearly all indoor spaces in the state are smoke-free.
These antismoking successes helped to set the stage for the most recent antitobacco efforts. Moreover, several studies conducted in the last three decades of the twentieth century confirm that long-term cigarette smoking causes emphysema, lung cancer, and heart disease. The Centers for Disease Control and Prevention, for example, estimates that more than 400,000 Americans die each year from smoking-related illnesses. Furthermore, reports the American Lung Association, the U.S. economy has lost nearly $100 billion in health care costs and diminished productivity due to smoking. States have traditionally paid for a part of these costs through Medicaid, a governmental health insurance program for the needy. However, in May 1994, the state of Mississippi decided to sue the tobacco industry to recover Medicaid costs for treating diseases caused by smoking. Soon afterward, more than forty states followed Mississippi’s example.
At first, cigarette companies declared that they would fight these lawsuits in court. In the past, the tobacco industry had won lawsuits filed by those who claimed that cigarette manufacturers were liable for their smoking-related illnesses. Tobacco industry lawyers had successfully argued that citizens were well aware of the health risks associated with regular smoking and that the required Surgeon General’s warning on cigarette packages consistently reminded smokers of the dangers of their habit. Those who chose to smoke in spite of these warnings, maintained the tobacco industry, were solely responsible for their decision to consume a health-damaging product.
In the late 1990s, however, several discoveries weakened the tobacco industry’s argument and increased cigarette companies’ willingness to negotiate settlements with litigants. For one thing, newly released tobacco company documents proved that cigarette manufacturers had for decades intentionally suppressed evidence about the hazards of smoking. Furthermore, former tobacco company workers stepped forward to testify that their employers had downplayed their awareness of the addictive nature of nicotine—yet had also experimented with manipulating nicotine levels in cigarettes to “hook” more smokers. In addition, previously secret industry documents revealed that tobacco companies intentionally—and illegally—targeted minors in their marketing campaigns. One R.J. Reynolds memorandum from 1975, for example, proclaims that “[Camel filters] must increase its share penetration among the 14–24 age group, which have a new set of more liberal values and which represent tomorrow’s cigarette business.”
These findings led to allegations that tobacco companies had perpetrated fraud by concealing important information about the nature of their products and marketing techniques. The states suing the tobacco industry asserted that since cigarette manufacturers had intentionally suppressed data that might have discouraged people from smoking, the cigarette industry was at least partly blamable for causing smoking-related illnesses.
In June 1997, the tobacco industry negotiated a preliminary agreement with forty of the states that had filed lawsuits. As part of the proposed settlement, the major cigarette manufacturers agreed to limit their marketing activities, initiate a campaign to reduce underage smoking, and submit to potential Food and Drug Administration (FDA) regulation of tobacco. In return, the tobacco industry would be granted immunity from future class action suits, and a limit would be placed on any damages won from individual lawsuits.
Some public health advocates welcomed the proposed settlement, claiming that it would lower teen smoking rates and effectively punish the tobacco industry for deceiving the public about the dangers of smoking. Others, however, sharply criticized the settlement for being too lenient on the tobacco industry. They argued that the agreement would actually cater to the tobacco companies’ financial interests by protecting them from expensive liability lawsuits. Since the 1997 settlement was subject to congressional approval, lawmakers who were critical of the preliminary agreement drafted legislation that would expand the scope of the original plan. Republican senator John McCain’s antismoking bill, entitled the National Tobacco Policy and Youth Smoking Reduction Act, demanded the tobacco companies to pay $516 billion over a twenty-five year period into a government fund—money that would reimburse states for smoking-related health care costs and pay for antismoking programs and research. McCain’s bill also requested a significant tax increase on cigarettes, the banning of outdoor advertising and ads using cartoon, animal, or human figures, an end to cigarette vending machines, and a requirement that the tobacco industry reduce the youth smoking rate by 60 percent over ten years. Moreover, the bill reduced the tobacco industry’s liability protections that had been proposed in the 1997 agreement.
McCain’s bill was strongly opposed by the tobacco industry. In the spring of 1998, the four major tobacco companies—Philip Morris, R.J. Reynolds, British and American Tobacco (owners of Brown and Williamson), and Loews—withdrew from negotiations. The McCain bill was unacceptable, they argued, because it did not provide enough liability protections and would eventually drive the tobacco industry out of business. The tobacco companies then placed full-page ads in the nation’s major newspapers, contending that McCain’s bill would place unconstitutional restrictions on tobacco advertising, launch new government bureaucracies to regulate products containing nicotine, create “half a trillion dollars in new taxes,” and “devastate the tobacco industry.” In the meantime, legislators became increasingly divided over the tobacco bill. Republicans and Democrats disagreed on how to allocate the $516 billion that would be raised as a result of the legislation. Also of concern was the amount of assistance that would be offered to tobacco farmers who would inevitably be affected by the passage of the bill. In the end, McCain’s tobacco legislation was rejected by the Senate in June 1998.
Although federal tobacco control legislation failed, the settlement eventually reached in November 1998 is loosely modeled on the June 1997 proposal. In addition to paying $206 billion to forty-six states over a twenty-five-year period, the tobacco industry has pledged to fund a $1.5 billion, five-year antismoking campaign that includes research and public education programs. In addition, cigarette manufacturers have agreed to certain marketing restrictions, including an end to the use of cartoon characters in ads, large-scale outdoor advertising, and the sale of logoemblazoned merchandise. Moreover, tobacco labels can no longer sponsor most concerts, youth teams, and sporting events. The tobacco industry now has protection against any future state lawsuits, although individual smokers can still sue.
Public health advocates have mixed feelings about the tobacco settlement. Cass Wheeler of the American Heart Association captured the public health community’s sentiments regarding the tobacco settlement with these words: “Perfect? No. A beginning? Yes.” Most antitobacco activists are pleased that the states will receive compensation for the medical costs of treating illnesses caused by cigarette smoking. But some feel that the settlement was a kind of victory for tobacco companies, as they will be shielded from many potentially damaging liability lawsuits. Others are concerned about loopholes in the settlement which still allow significant amounts of advertising to reach teenagers. For example, each tobacco company can still sponsor one brand-name event each year, such as Brown and Williamson’s Kool Jazz Festival. Cigarette companies can also promote their products within these annual events—including posters lauding the company’s support and brand names painted on race cars. Moreover, outdoor advertising that emphasizes tobacco-company sponsorship is allowed ninety days before an annual event. Hubert H. Humphrey III, attorney general of Minnesota, contends that the settlement “demonstrates how far we have to go.” He maintains that legislators must create provisions “that would keep track of tobacco use by minors and penalize the industry if it does not decline.” Moreover, Humphrey argues, since the tobacco industry is likely to “fight to keep their customers addicted . . . Congress must grant regulatory authority over nicotine to the [FDA].”
Some critics of the tobacco settlement are appalled at the amount of time, energy, and expense that has been invested in battling an industry that manufactures a legal product. Many of these critics contend that the health dangers of smoking have actually been exaggerated in order to advance the antitobacco agenda. Retired scientist Rosalind B. Marimont maintains that “by vastly overrating the dangers of tobacco . . . [antismoking groups] have gravely distorted the proper priorities for our resources.” Los Angeles radio talk-show host Dennis Prager also argues that the “war on tobacco” represents a dangerous misplacement of moral values: “The next generation will ask: What preoccupied America in the final decade of the twentieth century—while unprecedented numbers of its children were being raised without fathers, while the country was living with rates of murder far higher than in any other advanced democracy . . . [while] rogue nations built stockpiles of chemical and biological weapons . . . ? The majority of [America’s] national politicians, state attorneys general and educators will be able to answer together, ‘We fought tobacco.’ Shame on them all.”
In the years to come, the battle between the public health community and the tobacco industry will continue as antismoking advocates continue to push for federally mandated controls on nicotine and tobacco products. Antitobacco activists hope to use the 1998 tobacco settlement as leverage for future tobacco control legislation, and in March 1999, Bill Clinton’s administration began assembling a task force to prepare a lawsuit against the tobacco industry to recover federal costs related to the care of those with smoking-related illnesses. At Issue: Smoking provides an overview of this continuing controversy as authors debate the health effects of smoking as well as the responses of scientists, industry supporters, consumer advocates, and lawmakers to the marketing and consumption of cigarettes.