Justices hear arguments on whether cigarette makers defrauded smokers with claims about light and low-tar cigarettes.
Washington – More than 45 million Americans are smokers, and nearly 85% of them buy “light” cigarettes such as Marlboro Lights, which are advertised as having lower tar and nicotine.
The Supreme Court, on the opening day of its term, heard arguments today on whether the tobacco industry can be held liable for allegedly perpetrating a massive fraud on the smoking public.
In recent decades, most smokers switched to “light” cigarettes, believing they posed less of a danger to their health. But studies have shown this common-sense view is wrong. Although machine tests showed “light” cigarettes emitted less tar when burned, actual smokers inhale about the same amount of tar when they puff on a “light” cigarette, the studies found.
The tobacco industry faces more than 30 class action lawsuits from smokers and ex-smokers who seek billions of dollars in damages and claim they were fooled by the marketing of light and low-tar cigarettes.
But the justices sounded receptive to an argument from the cigarette makers that all these suits should be thrown out because they conflict with the federal law that requires warning labels on cigarette packs.
That law shielded tobacco firms from any other “requirement respecting the promotion of cigarettes based on smoking and health,” Washington attorney Theodore B. Olson told the court. The former U.S. solicitor general was representing the Altria Group, the parent company of Philip Morris and the maker of Marlboro Lights.
His argument tracked a recent trend in the high court holding that products subjected to federal regulations are shielded from lawsuits filed under state law. In nearly every state, consumers who say they were fooled or cheated by a product maker can sue for damages.
In the case before the court, several smokers from Maine sued Altria under the state’s law against “unfair and deceptive” trade practices, and they alleged they were misled by the marketing of “light” cigarettes.
Olson said their claim should be tossed out because “Congress wanted one uniform source of regulation of advertising of cigarettes,” not different rules established by states and jury verdicts.
But a lawyer for the consumers said Congress did not intend to wipe out suits involving deceptive marketing. Lawmakers who set the warning labels in 1969 had “no intention whatsoever to immunize cigarette makers for false statements” about their products, David C. Frederick, told the justices.
At one point, Justice Samuel A. Alito Jr. suggested the real culprit was the Federal Trade Commission. This agency oversees the warning labels on cigarettes, he noted, and it allowed the cigarette makers to tout the data from the machine tests indicating “light” cigarettes emitted less tar.
“If these figures are misleading, then you should have prohibited them a long time ago,” Alito told an FTC lawyer. “You have created this whole problem by, I think, passively approving the placement of these figures in the advertisements [in the packaging]. You have misled everybody who’s bought those cigarettes for a long time,” he said.
The FTC lawyer replied that the agency itself had been fooled because tobacco companies had hidden research data indicating that actual smokers did not benefit from switching to light or low-tar cigarettes.
Also today, the justices turned down without comment hundreds of appeal petitions which had piled up over the summer. In doing so, they let stand several noteworthy rulings.
In Arizona, an anti-abortion group had won a free-speech right to obtain license plates with the message “Choose Life.” The state permits private groups to obtain special plates, so long as they meet several basic criteria, and because the anti-abortion group qualified, its message should not be censored, the U.S. 9th Circuit Court of Appeals said In the Stanton vs. Arizona Life Coalition case.
The court also let stand rulings that allow juries in Louisiana and Oregon to convict criminals even when they are not unanimous in their verdicts. In the past, the court said the Constitution does not require unanimous verdicts in all cases. They refused to reconsider that issue in the case of a Louisiana murderer in the Lee vs. Louisiana ruling.
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The United States Supreme Court on Monday ruled that "tobacco companies that marketed 'light' and 'low tar' cigarettes may be sued for fraud." The 5-to-4 judgment is expected to open the way for dozens of lawsuits claiming billions of dollars in damages.
United States Supreme Court building.

In the certiorari ruling penned by Justice Stevens, the Court held that a class action brought under state law prohibiting deceptive advertising generally was not preempted by federal law regulating cigarette advertising. The lawsuit claims that tobacco makers who manufacture "light" and "low tar" cigarettes had deceived smokers into thinking the products are safer than regular cigarettes. Former United States Solicitor General Theodore Olson, now working with Gibson, Dunn & Crutcher, argued the case for the petitioners, Altria Group and Philip Morris USA.

Several smokers in recent decades switched to light cigarettes, with fervent faith they posed less of a danger to their health. But scientific or medical researches have shown this common-sense view is wrong. Although mechanical tests showed "light" cigarettes emitted less tar when burned, actual smokers inhale about the same amount of tar when they puff on a light cigarette, the studies found. The cigarette business faces more than 30 class-action lawsuits from smokers and ex-smokers who seek billions of dollars in damages and claim they were deceived by the marketing of light and low-tar cigarettes.
 
Respondents Stephanie Good and 2 others are Maine residents and for over 15 years smoked Marlboro Lights and Cambridge Lights cigarettes, which are manufactured by petitioners Altria Group and Philip Morris USA. They sought damages compensation for economic rather than medical harm, claiming they had overpaid for cigarettes based on fraudulent advertisements suggesting that light cigarettes were safer than regular ones. The Labeling Act requires tobacco companies to indicate rotating warnings on their packaging and advertising. “No requirement or prohibition 'based on smoking and health' shall be imposed under state law with respect to the advertising or promotion,” the law provides, and only if the labeling requirements on cigarettes are obeyed. 
Evolution of the "Marlboro Miles" promotion. From left to right: "5 Miles" used through 2003; "FIVE Miles" used ca. 2004-2006; and no Marlboro Miles (after ca. April 2006).
In the case, the Court applied the pertinent Federal laws, in question, Title 15 U.S.C. § 1334(b), the "Federal Cigarette Labeling and Advertising Act" and Me. Rev. Stat. Ann., Tit. 5, § 207 (Supp. 2008), the "Maine Unfair Trade Practices Act" (MUTPA). It held that "the Labeling Act neither expressly nor impliedly pre-empts respondents’ fraud claim." The landmark decision allows the lawsuit to proceed on the merits upon remand to the trial court below. The ruling strikes a blow against a broad effort by U.S. corporations to limit their exposure to lawsuits filed under federal law. 

The court also dismissed Philip Morris's argument that the Federal Trade Commission's mid-1960s endorsement of machine testing of cigarette tar and nicotine levels "should relieve the company of liability for alleged fraud." In November, the FTC officially dropped its endorsement of the Cambridge Filter Method, saying it is flawed because "the machine doesn't take into account the way smokers adjust their behavior."

The Supreme Court in a June ruling, said 8 to 1 that "a case filed in a state court alleging a defective catheter was pre-empted by a federal statue providing regulation of medical devices to the U.S. Food and Drug Administration." The court also ruled in 1992 in 'Cipollone v. Liggett Group, Inc.' that "the phrase 'based on smoking and health' in the Labeling Act did not apply to pre-empt suits under state laws based on the 'general duty' not to make fraudulent statements." 

Justice Clarence Thomas said that "some kinds of fraud claims against cigarette makers may go forward, just not those concerning smoking and health. Thus, if cigarette manufacturers were to falsely advertise their products as ‘American-made’ or ‘the official cigarette of Major League Baseball,’ state-law claims arising from that wrongful behavior would not be pre-empted. Forbidding lawsuits based on health claims, would not mean consumers lack protection, as tobacco marketing is subject to regulatory oversight." 

Altria's associate general counsel, Murray Garnick, in a statement, said "we continue to view these cases as manageable, and the company will assert many of the strong defenses used successfully in the past to defend against this very type of case."