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California v. Philip Morris Inc.

(3rd Party Rec. CA Superior Ct. 1997 Settled)

This third party health care cost recovery suit was brought by Daniel E. Lungren as Attorney General for the People of the State of California, S. Kimberly Belshe, as Director of Health Services of the State of California, American Cancer Society California Division, American Heart Association California Affiliate, California Medical Association and California District of American Academy of Pediatrics against Philip Morris, R.J. Reynolds, Brown & Williamson, British American Tobacco, Lorillard, American Tobacco Co., the Council for Tobacco Research and the Tobacco Institute on June 12, 1997.
The plaintiffs alleged that since the 1950s, the defendants have marketed their product despite scientific showings that cigarettes had negative health effects. The defendants conspired to publish disinformation and suppress research. They promised consumers they would conduct and disclose unbiased research, and instead have concealed it, including information on addiction. They represented that light cigarettes were healthier than regular cigarettes when in fact they are about the same. The plaintiff also alleged that the defendants manipulated nicotine levels to support addiction and targeted youth. The plaintiffs claimed defendants violated the Cartwright Act, made a false record or statement to avoid obligation, and violated the unfair competition act. The plaintiffs sought recovery of Medi-Cal expenses, and injunctive relief against further misrepresentations.
The case was heard in the Superior Court of the State of California for the City and County of San Francisco (Case No. 980864). The case was settled as part of the Master Settlement Agreement, executed November 23, 1998.
Following the settlement, on July 10, 2000, the plaintiffs filed an Application for Enforcement Order for Violation of the Consent Decree and Final Judgment against R.J. Reynolds. The plaintiffs alleged the defendants continued to distribute free sample cigarettes outside of Adult-Only Facilities in violation of Section V.E. of the MSA. R.J. Reynolds allegedly violated the MSA by sending unsolicited, free packs of cigarettes in separate mailings to individual homes for purposes of "consumer testing" that was not likely to yield useful information. The plaintiffs made repeated demands that the defendant stop such distribution, but the defendant refused. The plaintiff sought injunctive relief against future distribution of free cigarettes in this manner and requiring photo identification verification for any recipient of free cigarettes, prior notice to and consent from any recipient of free cigarettes, a method of delivery that assures the intended recipient was reached, and attorney fees.