Senators urge new appeal on tobacco
on Sep 20, 2006 at 5:15 pm
Fourteen U.S. Senators — 13 Democrats and an Independent — urged the Justice Department on Wednesday to pursue a new appeal in the massive government case against the tobacco industry, perhaps setting the stage ultimately for Supreme Court review of the government’s power to force a surrender of corporate profits as a remedy for a RICO anti-racketeering violation. The senators were seeking to put pressure on Attorney General Alberto O. Gonzales to try to regain that authority.
As of Wednesday afternoon, the Department apparently had not filed a notice of appeal in U.S. District Court. Under federal rules, it has until Sept. 25 to do so, unless it seeks and obtains permission for an extension of time. (Correction: The blog has been informed that the government’s 60-day period for filing a notice of appeal has not yet begun to run, because the industry has filed post-trial motions that delay the start of that period. We regret the error.) Six separate appeals have been filed by tobacco companies (Circuit dockets 06-5267 through 06-5272).
Last year, the government did appeal to the Supreme Court with the specific aim of regaining wide authority to fashion RICO remedies. It asked the Court to decide whether a federal judge’s power to issue appropriate orders to remedy violations of the RICO law “encompasses the remedial authority to order disgorgement of illegally-obtained proceeds” (docket 05-92) The Court denied that appeal without comment last October 17. It did so after the industry argued that the case was premature, since the industry had not been found to have violated RICO in the government case. “The most efficient and orderly manner of proceeding,” the industry told the Court then, “is to permit the District Court to issue its final judgment and then allow for appellate review in the ordinary course.”
On August 17, however, U.S. District Judge Gladys Kessler, bringing to an end the government’s seven-year lawsuit, ruled that the industry had violated RICO by a decades-long campaign to deceive smokers about the health hazards of smoking. Kessler noted, in her opinion, that she was not able to impose “a number of significant remedies proposed by the government” because of a 2005 ruling by the D.C. Circuit Court. The Circuit Court had ruled, she noted, that RICO only allows “forward-looking remedies,” and thus barred such backward-looking alternatives as disgorgement of ill-gotten gains.
The judge also said that the Circuit Court ruling kept her from considering a government plea for a comprehensive smoking cessation program, and a marketing program to counter the industry’s appeals to the youth market.
It was that Circuit Court ruling, of course, that the Supreme Court refused to review last October. Now that Kessler has issued a final decision, it appears that the scope of remedies under RICO would now be open for a new appeal. Although the D.C. Circuit would be bound by its prior decision (unless it agreed to hear that question en banc), the issue would be an open one for the Supreme Court since its prior denial of review did not constitute approval of the Circuit Court ruling.
The 14 Senators, in their letter to Gonzales on Wednesday, argued that the prior Circuit Court ruling “drastically limited the ability of the trial court to impose effective remedies for the tobacco industry’s gross violations of the racketeering statute. It is imperative that the Justice Department pursue every available avenue of appeal to overturn this misguided Court of Appeals decision.”
An earlier post describing the government’s appeal to the Supreme Court can be found here.
A news release describing the senators’ letter to Gonzales, and the text of the letter, can be found here.
