"I do know definitely that the investigation has been undertaken," says Richard Daynard, of the Tobacco Products Liability Project. "I have no idea what stage it is in."
Tobacco on Trial, the publication of the Tobacco Products Liability Project, reported that the U.S. Attorney's office is considering applying the RICO statute to a pattern of alleged fraud by tobacco companies that was revealed recently in the New Jersey discovery decision, Haines v. Liggett. The U.S. Attorney of the Eastern District of New York, Andrew Maloney, would not comment on whether an investigation is being conducted.
The RICO statute prohibits the use of income gained from a pattern of racketeering activity to acquire an interest in any enterprise engaged in interstate or foreign commerce. This language is broad enough to cover many tobacco companies' acquisitions, such as R.J. Reynolds' purchase of Nabisco, or Philip Morris' acquisition of Kraft and General Foods, if the tobacco profits used to acquire these companies were obtained through "racketeering activity," Tobacco on Trial reported.
The U.S. Attorney would probably use the RICO statutory provision forbidding mail fraud, says Tobacco on Trial. The tobacco industry has placed ads in magazines and newspapers sent through the mail since 1954 that may be considered fraudulent. These ads claimed that independent research cast doubt on the consensus scientific view that smoking causes fatal diseases, and that the tobacco industry was pursuing research to resolve these doubts, according to Tobacco on Trial.
As part of the plea agreement with New York State and the United States Attorney's office in Syracuse, the Manhattan-based company has paid $3.5 million in criminal fines and penalties and agreed to build a waste water pre-treatment facility that is required to cost between $10 million and $30 million.
Bristol-Myers Squibb admitted in the plea agreement to discharging chemical pollutants into water treated by the Onondaga County Metropolitan Syracuse Wastewater Treatment Plant during September and October 1987, in violation of the federal Clean Water Act.
Bristol-Myers also admitted to discharging hazardous solvents into Ley Creek, which flows into Onondaga Lake, without having obtained permits from the New York Department of Environmental Conservation. In March 1990, the company assured state and federal officials that it would stop polluting the lake.
Bristol-Myers Squibb said in a prepared statement, "We accept our responsibility and believe that the terms of the settlement are in the best interests of the Syracuse community. ... These incidents are not characteristic of our record as an environmentally responsible company. At no time has the public health been affected or at risk."
The ads look like an Absolut Vodka ad, but the copy reads "Any suggestion that our advertising campaign has contributed to alcoholism, drunk driving or wife and child beating is absolute nonsense. No one pays attention to advertising."
Keith McIntyre, national marketing manager for Absolut Vodka Canada warned Adbusters not to run the ad. "If you want Absolut to play hardball, then Absolut will play hardball," McIntyre told Kalle Lasn, director of the Media Foundation.
Lasn charges Absolut with engaging in censorship. Lasn says that he plans to send another satirical ad, titled "Absolute Silence," to more than 100 magazines around the continent as a public service.
"We believe our �Absolut Nonsense' ad is fair comment on an issue of profound social concern," Lasn said. "Absolut profits greatly from the association of its product with pleasure, parties, Christmas, and a host of other appealing, upscale cultural icons - but what about the negative associations?"
Surgeon General Antonia Novello has put the cost of alcohol abuse to society at over $100 billion a year. Novello claims that children see 100,000 alcohol commercials before they reach the legal drinking age.
- Ben Lilliston