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Cases / Lobbying, PR and greenwashing · United States · 2006

US judge finds tobacco firms violated RICO; remedies later cut back

Short record: the main facts, with sources. A full case file has not been prepared.

Nature's voice · report
No measurement of the harm done to me here is on record.
Did nature suffer? Not measured.
What the record lacks: 1 none on record · 2 insufficient · 1 not measured See the gaps

On 17 August 2006 Judge Gladys Kessler found that the tobacco companies had violated the federal racketeering law (RICO) by defrauding the public for about 50 years. A higher court had barred the return of 280 billion dollars in past profits, leaving the companies with corrective statements and costs.

What?
Judge Gladys Kessler found in August 2006 that the tobacco companies violated RICO by defrauding the public for about 50 years, but the remedies were cut back to corrective statements and costs. NBC News/Reuters
Where?
United States NBC News/Reuters
When?
Ruling on 17 August 2006; the period of fraud covered about 50 years NBC News/Reuters
Who?
Gained
  • Tobacco companies — Remedies limited to corrective statements and costs; 280 billion dollars of past profits not returned NBC News/Reuters
Lost
None on record
Harmed
  • The public — Misled for about 50 years, according to the court's finding NBC News/Reuters
Why?
Not stated in the sources reviewed.
How?
A federal racketeering (RICO) case in which the judge found a pattern of fraud, with remedies narrowed by a higher court. NBC News/Reuters
6 of 6 questions answered from the record

What happened

The record, in order.

On 17 August 2006 Judge Gladys Kessler ruled that the tobacco companies had violated the RICO racketeering law by defrauding the public for about 50 years (NBC News/Reuters).

A higher court had barred the return of 280 billion dollars in past profits, and a 14 billion dollar programme request was rejected (NBC News/Reuters).

The companies were left with duties to issue corrective statements and to pay litigation costs (NBC News/Reuters).

    In court and with insurers

    Every proceeding and every insurer decision on record.

    Lawsuits and rulings

    1. 2006-08-17Reduced on appeal
      Kessler RICO ruling against tobacco companies
      US federal court · Civil · Not stated in the sources reviewed → Tobacco companies

      Judge Gladys Kessler found RICO violations; a higher court barred the return of 280 billion dollars in past profits, and the companies were left with corrective statements and costs. NBC News/Reuters

    Insurers

    No insurer decision on record.

    What we don't know

    Undisclosed, unproven, untried: recorded as data.

    Nature

    • Not measured Harm to nature: The record holds no measurement of harm to nature.

    Record

    • Insufficient Reported but not verified: the 1998 Master Settlement Agreement with 46 states, about 206 billion dollars over 25 years, and a 40 to 50 cent rise in pack prices after it.
    • Insufficient Reported but not verified: a 1994 perjury inquiry into seven company chief executives who had testified that they believed nicotine was not addictive; no charges were brought.
    • None on record Not stated in the sources reviewed: whether any company executive was personally prosecuted in connection with the ruling.

    Did the harm stop?

    Not stated in the sources reviewed.

    Who paid?

    Not stated in the sources reviewed.

    Sources

    Voices on record: — Company or project— Government and regulators— Courts✓ Press and investigations— Communities and civil society— Researchers

    Press and investigations

    Terms used on this page

    Law and courts

    Disgorgement
    An order to give up profits gained from wrongdoing, used by the US Securities and Exchange Commission.
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