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Open Access Publications from the University of California

The United States Government’s Racketeering Lawsuit against the Cigarette Industry


Abstract Cigarettes manufactured by fewer than half a dozen domestic companies cause approximately 440,000 deaths and $155 billion in medical and lost productivity costs each year in the United States. Despite this toll, Congress has not authorized the United States Food and Drug Administration to regulate cigarette design or marketing. Likewise, the Consumer Product Safety Commission cannot regulate cigarettes and the Federal Trade Commission has played a relatively passive role over the past two decades.

Where legislative and regulatory approaches fail, courts have offered an alternative means of addressing the harm caused by cigarette manufacturers. Successful products liability lawsuits against cigarette manufacturers shift health and productivity costs of smoking from families and third-party payers back to cigarette companies, forcing increases in cigarette prices. Litigation thus has proven to be an effective public health strategy for reducing smoking.

On September 22, 1999, the United States Department of Justice (“DOJ”) filed a lawsuit against the leading domestic cigarette manufacturers (collectively, “Defendants”) in the United States District Court for the District of Columbia. DOJ is seeking to stop the Defendants’ alleged decades-long misrepresentations and other fraudulent conduct under the Racketeer Influenced Corrupt Organizations Act (“RICO”). RICO authorizes DOJ to pursue criminal and civil sanctions against individuals and organizations that are engaged in a conspiracy involving certain federal felonies, including mail and wire fraud. DOJ is pursuing RICO’s civil sanctions only in this lawsuit. This law synopsis provides an overview of the lawsuit and its possible outcomes, reviews the basic allegations against Defendants and their responses, reviews the remedies DOJ seeks, and covers important events during the litigation’s pre-trial phase. The synopsis also summarizes the manner in which the trial will proceed, reports key testimony provided thus far, and outlines the impact of possible outcomes.

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