TUE, DAY 105: As We See It. . .

May 17, 2005 11:14 pm by Gene Borio

JUDGE KESSLER: How many people in this country earn what Warren Buffett earns?

DR. FIORE [roughly]: Not too many.

JUDGE KESSLER: How many people in this country have assets equivalent to what Warren Buffett has?

DR. FIORE: I suspect very few

JUDGE KESSLER: Thank you, Dr. Fiore.

And thus did Judge Kessler let Philip Morris attorney Ted Wells know that he’d do well to get off his Warren Buffett kick pronto. Judge Kessler obviously felt Mr. Wells had gone far enough with his questions about how Warren Buffett could theoretically call Dr. Michael Fiore’s proposed National Tobacco Quitline and rip off some free smoking cessation counseling and medications for himself.

I’m sure Mr. Wells had felt it was a trenchant point, and yes, it may have had some impact when first used early this morning–and it certainly juiced up us reporters– but Judge Kessler let him know that by this afternoon, it was played already, so played.

It wasn’t the only time that Judge Kessler let Mr. Wells know when his view of pertinent was her view of pointless.

It happened again while Mr. Wells was trying to parse out 2 instances where Dr. Fiore’s answers today did not jibe precisely with the answers he’d given in his deposition last week. The discrepancies could have been a matter of interpretation and context, or even due to the fatigue of a 7-hour session. But they were minor and ambiguous enough to be moot, and as Mr. Wells belabored his point by saying to Dr. Fiore, “You were asked under oath in Madison, WI. . . on May 5 of this year . . . ” Judge Kessler said,

“Mr. Wells, let’s not lose sight. . . this questioning on this issue is going to be of no moment.”

Mr. Wells is expert at taking his lumps and moving on smoothly, but the clash of perspectives in the incidents above bring into relief the different interpretations and impressions that people –even the participants themselves–may have about the events of the trial. I’m amazed at how markedly my view of events or takes on people can differ from that of others who witnessed the exact same thing.

For example, at least one observer simply hated Dr. Fiore.

Granted, Dr. Fiore is not the ingratiating type. He had that kind of brusque, no-nonsense doctorly demeanor that seemed through with you as soon as he scribbled out your prescription. Nothing personal, you understand, just a lot of other patients behind you who need to be helped. His down-turned mouth let you know that the ongoing battle to save lives is a ferocious and grim one. Dr. Eriksen and Mr. Bernick often shared a genuine laugh between bouts. That would not happen here, by any means.

The aforementioned observer felt Dr. Fiore was being obstructive in his answers, and it’s true that he filled them with numerous qualifications and elaborations, made great use of, “you read that correctly,” and repeatedly barked out, “Sir!”

I happened to feel his elaborations were partly indicative of an experienced witness, and often canny and purposeful.

But quite early in the proceedings, Judge Kessler had to warn him [roughly]:

“Dr. Fiore–sometimes Expert Witnesses have a tendency to want to tell me everything they know. But that’s what the Direct Testimony is for. On cross-examination, try to narrow your answers, and answer only what is asked. If you can, try to limit your answers to yes or no. I’ve read your testimony, and be assured I’ve paid close attention to both your written and direct testimony.”

Yet, still, Mr. Wells had to reiterate several times, “Yes or no, please!”

Near the end of the day, even Judge Kessler herself had to re-ask a question.

“The Group Health Cooperative cessation program was for enrollees only?” she asked. Dr. Fiore then elaborated on the program on which he based his projected participation estimates for his own cessation program.

“So,” she said after he had finished, “my answer is yes? . . . The program was available only to enrollees in the organization?”

“Yes,” said Dr. Fiore in a rare moment of monosyllabicality.

And yet Judge Kessler’s view of events seemed to turn 180 degrees only a few minutes later, when at the end of a long, long day, Mr. Wells told her that he foresaw yet another 3 hours of cross-examination tomorrow. Judge Kessler expressed some incredulity, and said, “You had 4 hours today, and Dr. Fiore’s been very responsive.”

At that, the observer’s lower jaw suffered a temporarily disfiguring loss of altitude. It would have been interesting to see Mr. Wells’ face.

To me, the shock was not that Judge Kessler’s view was so different from the observer’s, but that it was so different from her own previously-stated view–and very recent personal experience.

This is not to say there is no concurrence in views. As the observer and I were talking about it in the hallway just afterwards, Mr. Bernick came over and, though not knowing our conversation, blurted out, “She said he was responsive(!)”

12 Responses to “TUE, DAY 105: As We See It. . .”

  1. David Gundersen Says:

    Despite Gene’s unflattering commentary on Dr. Fiore’s style and Judge Kessler’s chastising, one thing is perfectly clear - the industry lawyers are getting frustrated. They’re not getting what they want and they can’t nail Dr. Fiore down into anything other than expert and credible commentary on the impact of the proposed remedies.

    Whether those remedies are appropriate depends on if Judge Kessler (and likely the Supreme Court) decides the residual addiction, branding presence, and profits stemming from the RICO violations warrant remedies. Remedies that undo the impacts of the RICO violations and prevent the industry from reaping additional profits (which arguably represents continued RICO violation) from their racketeering are both forward-looking and appropriate. If they are found to be racketeers (which they will), remedies must be implemented.

  2. tobacco observer Says:

    >>Whether those remedies are appropriate depends on if Judge Kessler (and likely the Supreme Court) decides the residual addiction, branding presence, and profits stemming from the RICO violations warrant remedies. Remedies that undo the impacts of the RICO violations and prevent the industry from reaping additional profits (which arguably represents continued RICO violation) from their racketeering are both forward-looking and appropriate. If they are found to be racketeers (which they will), remedies must be implemented.

    Respectfully, this is no longer up to Judge Kessler. The DCCA has already determined that remedies in civil RICO cases must be “forward looking”, and they have denied further review on this issue. If the gov’t appeals to the Supreme Court of the US as they said they would, perhaps the SCOTUS will ultimately disagree. . .that remains to be seen. . .but given its tendency not to intervening in ongoing cases, its unlikely that the SCOTUS will accept jurisdiction over this case until *after* Judge Kessler has made her decisions on liability and remedies.

    In the meantime, according to the DCCA remedies that “undo the impacts” of past RICO violations, like disgorgement, are specifically NOT permitted under RICO section 1964(a). Profitting from the legal sale of cigarettes is simply not a RICO violation. Smoking is not a RICO violation. Marketing cigarettes under FTC guidance is not a RICO violation.

    Even if it is proven that past RICO violations by tobacco caused smokers to become addicted to cigarettes, available remedies must address the possibility of tobacco repeating those same violations in the future. If the RICO violation in question was fraudulent marketing claims, then available remedies would need to address the possibility of additional fraudulent marketing claims. Smoking cessation programs don’t address potential RICO violations at all. . .at best they address an effect of past RICO violations, something again, that has been expressly prohibited by the DCCA appeals court.

    >>If they are found to be racketeers (which they will), remedies must be implemented.

    Again, I believe that is not legally correct.

    Even assuming Kessler finds evidence of past RICO violations/ racketeering, that, by itself, doesn’t matter except as a premise. With past violations proven, she can then implement remedies only to “prevent and restrain” ongoing and likely *future* RICO violations. If the gov’t can’t come up with any legally permissible remedies to address likely future RICO violations (and it seems like they are having serious trouble in that regard) then Judge Kessler can’t apply any.

    The problem the gov’t is having isn’t that there aren’t any available remedies. . .Judge Williams gave explicit examples of permissible remedies in his commentary in the DCCA appeal decison on disgorgement. . .the problem is that none of the available remedies cost tobacco any money *up front*, and the DOJ doesn’t seem interested in those sorts of things. They’re still looking for tobacco to fund dramatic national programs. These things look and “feel” great. . .they just aren’t pertinent to ongoing racketeering!

  3. krueger Says:

    Yes, it’s perfectly legal to secretly engineer your product as highly addictive drug, lie about it to the public, the Congress, and the courts, and get generations addicted to it, usually as children, slowly killing 14 million Americans. There are no remedies. Technicalities of DCCA, don’t you see. Legal stuff.

    Once again I’m reminded of legal analysis by financial analysts:


    I prefer to get my legal analysis from lawyers:


  4. tobacco observer Says:

    >>There are no remedies. Technicalities of DCCA, don’t you see. Legal stuff.

    You can’t sew a silk purse out of Sow’s ear.

    If the gov’t wanted better remedies they shouldn’t have filed this racketeering suit under civil RICO 1964(a). That’s a limited act with limited purpose, and those limitations have been highlighted in great detail by the DCCA appeals court.

    Allegations of tobacco breaking the law don’t give the gov’t license to get anything they want. They’ve got to follow the law too, in this case the DCCA case law.

    >>I’m always amused by the “tobacco is legal product you know” argument. So’s drink. So are cars. Drunk driving, it turns out, is against the law.
    >>Guess how far you get arguing you can’t be punished for drunk driving because drink and cars are legal products. Turns out that particular legal analysis doesn’t impress the court a whole bunch. But don’t take my word, go ahead tell the court it doesn’t make any legal sense.

    This argument doesn’t make any legal sense.

    Drunk driving is a specific criminal offense with specific proscribed penalties. Selling cigarettes is not.

    Racketeering *could* be a criminal offense, but not in this case. That’s because the gov’t, already *having failed* attempts at a criminal case against tobacco deliberately filed this weaker civil RICO case.

    Now, it was the DCCA (not me) who specifically said that under the civil RICO act 1964(a) remedies designed solely to punish tobacco for past behavior are prohibited. They also said that the only remedies permissible under that statute need to serve to “prevent and restrain” future RICO violations.

    So if the gov’t can come up with appropriate remedies to address RICO violations, they might get some. If they persist with these silly requests, they’ll get nothing. But don’t take my word for it. Go read Kessler’s remarks on the disgorgement decision.

  5. krueger Says:

    Thanks again for the legal advice. Once again I’m reminded of legal analysis by financial analysts.

    I prefer to get my legal analysis from lawyers:




  6. Pro_Business Says:

    Thanks again for posting links to a website sponsored by lawyers who are dedicated to the destruction of tobacco at all costs. I am sure that their commentary is unbiased and legally sound.

    However, I prefer to get MY legal analysis from the actual judges who rule on these things. To quote Justice Sentelle: “Because we hold that the District Court erred when it found that disgorgement was an available remedy under 18 U.S.C. § 1964 (a), we reverse the District Court and grant summary judgment in favor of Appellants as to the Government’s disgorgement claim”

    ref: http://www.altria.com/download/pdf/media_doj_disgorgement_summary%205-05-05.pdf

    I might also remind you that 9 of the 12 DCCA judges did not even vote for an en banc rehearing. Perhaps they know something that the Northeastern lawyers don’t?

    It would be wise for all of us here to heed the opinions of Justice Sentelle. At the end of the day, he and the rest of the DCCA judges will have final word over what happens, including whatever legally-unsound remedies Kessler might actually grant to the DOJ. Think about that before you continually post links to the Tobacco Control Resource Center.

  7. krueger Says:

    Thanks for posting Big Tobacco’s website. I’m sure its content is unbiased and never stoops to selective quoting of decisions favorable to it.

    TCRC is the Northeastern University School of Law. If you prefer to believe Big Tobacco, be my guest.

    Something you won’t find on Big Tobacco’s website: Judge Munter’s opinion in Henley. You’ll find it at the TCRC:

    www.tobacco.neu.edu/box/BOEKENBox/ Henley%20v%20PM/MunterOrderHenley.pdf

    If you want only the story Big Tobacco tells on tobacco litigation, Philip Morris has a website for you.

    I prefer to get the whole story.

  8. krueger Says:

    Actually, you’ll find it a whole lot faster if URL doesn’t have an embedded space:


  9. David Gundersen Says:

    Still missing the point. What is the industry’s violation of RICO? Is the “viloation” simply what was done in the past or does the continued addiction and residual branding qualify as part of the same violation? The violation is the act and its associated ongoing impacts: (1) continued addiction, (2) branding presence, and (3) new, daily industry profits. The RICO violations continue to this day and the only way to prevent future violation is by addressing all three.

    If the money taken from the industry is not money earned previously as a result of RICO violations, but money earned tomorrow and the next day from the addiction created by the RICO violations, that is not disgorgement. It is taking future gains and using them to prevent future RICO violations (addiction and profits resulting from the violation).

  10. tobacco observer Says:

    Still missing the point. What is the industry’s violation of RICO? Is the “viloation” simply what was done in the past or does the continued addiction and residual branding qualify as part of the same violation?

    The alleged RICO violations in question are false marketing claims.

    Addiction is not a RICO violation. Simply marketing cigarettes is not a RICO violation. Selling cigarettes is not a RICO violation. Making profits is not a RICO violation. (Youth smoking is not a RICO violation either, incidentally).

    The DCCA has specifically addressed the above question. According to the DCCA, the only permissible remedies in this case MUST address the possibility of tobacco violating RICO in the future. Remedies that address the effects of PAST RICO violations (like residual addiction or brand image) are *specifically prohibited*.

    More bluntly, according to the DCCA, even if tobacco *IS* still earning money from past RICO violations, there is nothing Judge Kessler can do about it under the civil RICO charges filed by the gov’t. All she can do is order changes to help prevent additional future RICO violations.

    So with all due respect to Professor Blakely and the Tobacco-hating lawyers from Northeastern, their opinions in this case so far have been proven wrong by the only ones whose opinions actually do count. . .the Federal DC Circuit court. Here is the relevant case law:


    And here is the opinion that actually counts:

    “Section 1964(a) provides jurisdiction to issue a variety of
    orders “to prevent and restrain” RICO violations. This language
    indicates that the jurisdiction is limited to forward-looking
    remedies that are aimed at future violations.”

    “This “comprehensive and reticulated” scheme, along with the plain
    meaning of the words themselves, serves to raise a “necessary
    and inescapable inference,” sufficient under Porter, 328 U.S. at
    19398, that Congress intended to limit relief under § 1964(a) to
    forward-looking orders, ruling out disgorgement.”

    “The language of the statute explicitly provides three alternative ways to deprive RICO defendants of control over the enterprise and protect
    against future violations: divestment, injunction, and dissolution.
    We need not twist the language to create a new remedy not
    contemplated by the statute.”

    Meanwhile, the gov’t didn’t even ask for divestment or dissolution. So for practical purposes, those are now unavailable. By case law, the *only* remedy available for Judge Kessler is injunction. What does that mean? This is what Senior Justice Williams has to say on that matter in special concurrence:

    “The equity court, empowered under § 1964(a) to “prevent
    and restrain” future violations, has before it the history of the
    defendant, including his past wrongs. It can decree relief
    targeted to his plausible future behavior. It can define the
    conditions bearing directly on that behavior. It can, for
    example, establish schedules of draconian contempt penalties
    for future violations, and impose transparency requirements so
    that future violations will be quickly and easily identified.”
    . . .Congress intended the words “prevent and restrain” to
    authorize only a tailored, forward- looking remedy. Penalties
    for violations of the court’s decree, and transparency-enhancing
    measures meet that standard.

    Has the gov’t actually asked for ANY of the kinds of things that Judge Williams specifically authorized in this case? Not as far as I can tell. Instead, they have wasted their time asking for remedies that don’t address future RICO violations, like smoking cessation programs, and youth smoking penalties. So, it should come as no suprise when Judge Kessler has no choice but to reject the gov’ts proposed remedies, substituting instead (if she finds liability) the sort of injunctions specifically authorized by Justice Williams.

  11. krueger Says:

    What is the industry’s violation of RICO? If I’ve understood your legal analysis, the answer is (a) nothing, and (b) even if there were something, there is no remedy, because of (c) legal technicalities.

    Thanks again for your legal analysis. Once again I’m reminded of legal analysis by financial analysts:

    “tobacco analysts…read the law very narrowly, in the way that favors their clients, er, I mean companies.”

    Wake-Up Call / The Tobacco Tar Pit, David Smith, July 17, 2000

    When I hear: no RICO violations, no RICO remedy, can’t be done, can’t do it, legal reasons say no, no way, Big Tobacco can’t be held accountable here, nuh uh, not today, not this way, law says no, no way Jose — that sounds like reading the law narrowly to favor Big Tobacco. Reminds me of legal analysis by financial analysts.

    Legal analysis by lawyers arrives at different conclusions:




    You’re welcome to bash Northeastern University School of Law and Notre Dame Law School. If you’d rather get your information from Big Tobacco, be my guest.

  12. David Gundersen Says:

    Dr. Fiore’s expert testimony was never undermined and the greatest defeat in the whole proceeding was the introduction of the $130 billion remedy recommendation. While DOJ leadership turned its back on the number, it has become the standard with the greatest capacity to influence the settlement talks and remedy ruling.

    In addition, the remedy recommendation is a crystallized example of tobacco industry influence within our regulatory, legal, and political systems. Why did DOJ back away? Do the legal tactics of the industry - particularly the courtroom and investigative harrassment of witnesses and lawyers/firms - warrant greater attention and tangible legal consequences? Are conflict of interest policies strong enough to prevent DOJ political appointees from accommodating political interests in the courtroom? I’m sure there are more questions and I hope somebody smarter than I asks them all.

    Regardless, there is room for small (and potentially large) victories. From all the noise and clatter of this mess of a trial, “$130 billion to help smokers quit and prevent tobacco addiction” will be the final echo. Hopefully, it’s what Judge Kessler heard last and loudest.

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