TOBACCO FIRMS LOSE HUGE SUIT

Landmark Ruling In U.S. May Cost Industry Billions

MIAMI - A jury at a landmark lawsuit by smokers yesterday held
tobacco companies liable for making a defective product that causes
emphysema, lung cancer and other illnesses.

The verdict could cost the tobacco industry billions of dollars in
damages, an amount the jury will determine in a later phase of the
trial.

Their decision could prove to be the industry's most dire courtroom
loss yet, since the plaintiffs are seeking at least $200 billion (U.S.).

American juries have awarded damages in smoking liability cases only
five times, three were overturned on appeal and the two others are
being appealed.

This case, before Judge Robert Kaye, was the first class- action
lawsuit by smokers to go to trial. It was filed in 1994 on behalf of
as many as 500,000 sick Florida smokers and the heirs of those who
died.

Plaintiffs and family members wept and hugged each other as the
verdict was read.

``The Marlboro Man just fell off his high horse into quicksand and it
will be years until the tobacco industry even gets him halfway out,''
said Ahron Leichtman, executive director of Citizens for a
Tobacco-Free Society.

Philip Morris Inc., the nation's largest cigarette maker, said it
remained under a court-imposed gag order and could not comment.

The industry claimed there was no scientific proof smoking caused any
illness and the public was well aware smoking was risky.

But the jury agreed with the smokers on all counts, including their
claims that the industry deceived them about the dangers of smoking,
hid research results, stopped scientific work that promised to produce
safer cigarettes and advertised to children.

The jury also found that the industry ``engaged in extreme and
outrageous conduct . . . with the intent to inflict severe emotional
distress.''

The $206 billion national settlement reached with the tobacco industry
in November bars states from suing to recoup the costs of treating
sick smokers, but it does not prohibit lawsuits by individuals, such
as this one.

Now that the industry has been found liable, the jury will decide what
damages should be awarded to the lawsuit's nine plaintiffs. Once their
cases are concluded, the 500,000 other members of the class will be
free to file their claims.

And that is just in the U.S.

In Canada, the Ontario government wants to take the U.S. tobacco
industry to court to recover the costs of treating smoking-related
illnesses.

Ontario has obtained legal counsel in the U.S. as part of its plan to
be the first Canadian jurisdiction to sue the industry for damages
under the Racketeer Influenced and Corrupt Organization Act.

If successful, the province could recover as much as $40 billion, the
ministry says. Money would be applied to the cost of health care to
treat smoking-related illnesses; and to public awareness and education
programs about the risks of tobacco use.

British Columbia has filed a lawsuit against Canadian tobacco
companies, which is to go to trial this fall.

In Miami, jurors heard eight months of testimony and were exposed to
thousands of documents from decades of tobacco litigation.

Former surgeons-general, ex-tobacco industry scientists and doctors
testified about the effect of smoking on the body, the difficulty in
quitting and the manufacturers' refusal to co-operate with health officials.

The defendants were the nation's five biggest cigarette makers and two
industry groups: Philip Morris, R.J. Reynolds Tobacco Co., Brown &
Williamson Tobacco Corp., Lorillard Tobacco Co., Liggett Group Inc.,
the Council for Tobacco Research and the Tobacco Institute.