Cornered

by Peter Pringle

  For all his dedication, his accomplished peformances, and his social energy, however, Motley failed to unseat Gauthier—if, indeed, that was his intention. In the end, it was not Motley but the Fifth Circuit Court of Appeals that pushed the Castano class action off center stage. But not before Motley had had a chance to skirmish with the enemy. Some wondered, after the event, whether the tobacco companies might settle the case right there. Their battle formation was at least temporarily in disarray.

  * * *

  IN OCTOBER 1994, seven months after the Castano suit was filed and during the early, unreal phase of the Third Wave, Motley was presented with a rare opportunity to skirmish with top tobacco lawyers. He had never faced them in court before, although his asbestos experience had given him a good grounding in the medical science of the lungs. He had learned about the synergistic effects of tobacco smoke and asbestos dust.

  The industry had launched a counterattack on a broad front. They had poured money into the midterm congressional elections and into election campaigns in states making efforts to impose tobacco control, such as California and Colorado. Philip Morris was in an especially spiteful mood, threatening to move its Park Avenue headquarters out of New York and cut off the millions of dollars it gave yearly to the arts if the city council passed smoking controls in restaurants. In Washington, D.C., the companies had deployed their finest lawyers on a mission to oppose the federal government’s plan to end smoking in the workplace. Despite hours of testimony from several hundred experts and witnesses on the effects of secondhand tobacco smoke, the plan by the Occupational Safety and Health Administration was being challenged on a daily basis by highly paid tobacco lawyers from the country’s blue-chip law firms. Each day for several months, in the ground floor auditorium of the U.S. Labor Department building near the Capitol, a phalanx of industry lawyers, twenty to thirty strong, in their dark suits, white shirts, and scarlet suspenders, would sit on one side of the auditorium. They were led by John Rupp, a handsome, dark-haired, articulate lawyer who represented the Tobacco Institute. On the other side, pitifully outnumbered, would sit the three representatives of the antismoking health groups, the American Cancer Society, the American Lung Association, and the American Heart Association. They were led by Matt Myers, a sharp-witted, liberal-minded, public-interest lawyer for the Coalition on Smoking or Health, who was to rise to much greater things before the end of the Third Wave.

  The atmosphere was oppressive and conspiratorial. The tobacco lawyers kept to themselves, refusing to speak to their opponents. Sherri Watson, a pleasant, caring woman, who was the public relations officer for the American Lung Association, sat through the entire performance and said at the time that she felt she was being followed wherever she went. “I would go to the telephone, so would someone else. I would come out of the ladies room, so would someone else. I’d go get some gum, so would someone else. It was the same person from the other side of the auditorium.”

  The health-group witnesses were subjected to withering cross-examination by Rupp and other industry lawyers, who knew as much if not more than the experts about the science of secondhand smoke. “We simply didn’t have the resources to follow this,” said Watson. “We knew we were going to have to find some other support.” Myers said, “We were stretched so thin. The tobacco industry was gearing up to turn these hearings into their Armageddon on environmental tobacco smoke. I called Dick Daynard at Northeastern University and Ness, Motley and Ron Motley called back.”

  Within days, what became known as the “Torpedo Team” was flying into Washington. Jodi Flowers from Motley’s office was first, then Hugh McNeely and Rhet Klok from the Castano group in New Orleans. They set up a field office in a hotel. Motley followed a few days later. “That was a glorious day when we heard Ron Motley and the others were coming,” said Watson. “They were in another league. They came in with their little document carts and their black lawyer’s cases. Motley looked so dapper with his cowboy boots. He was saying ‘Hi’ to everyone; a very confident gentleman.”

  Motley’s strategy was to undermine the industry’s witnesses and scientific experts by attacking their credibility. His first target was William Althaus, the former mayor of York, Pennsylvania, and now chairman of the National Smokers’ Alliance, an industry-funded “grassroots” group. (The antitobacco forces called them AstroTurf organizations.) With a little bit of digging, Motley had discovered that Althaus, while mayor of York, had signed an executive order banning smoking in the city’s offices. The order included the sentence, “The City should treat nicotine like any other addiction by providing financial assistance for a substance-abuse program.”

  “Have you ever declared smoking to be addictive?” Motley asked, out of the blue.

  “I don’t recall,” replied Althaus.

  “Have you ever declared environmental tobacco smoke to cause disease?”

  “I don’t recall,” the mayor said again.

  The next day, Motley was quoted in the mayor’s hometown newspaper, the York Daily Record, as saying, “We ruined your mayor.” Motley told the newspaper his aim had been to “reveal the NSA for what it is—a group of shills for the tobacco companies.” Motley said he had been called in to stop the health groups being “beaten up by slick tobacco industry lawyers. They wanted some of our junkyard dogs, and we had a lot.”

  In the basement auditorium, the administrative judge running the hearing, a mild-mannered man named John Vittone, objected to Motley’s characterization of the health groups as being “beaten up by slick tobacco industry lawyers.”

  MOTLEY: Well, sir, I think my position simply stated is that the tobacco lawyers have a history of being well financed and well prepared to do a very effective job of pointing out deficiencies as they perceive them [and] the people who asked me to come here were not as well financed or prepared, or able to ask the same kinds of probing questions.

  JUDGE: I don’t see that as beating up on witnesses.

  MOTLEY: Well, perhaps it’s a matter of perception, your honor.

  The judge then asked Motley if it were true, as the newspaper had said, that he had hired a private detective to get “dirt” on Althaus, because if it were true “it would indicate Motley had been beating up on a witness.… This is not a trial for damages.” Motley said it wasn’t true. He had only hired a detective to get a picture of York City Hall.

  Motley had set a new tone for the entire hearings. A second lawyer on the Torpedo Team, Hugh McNeely, cross-examined Albert Nichols, an independent environmental economist with the National Economic Research Association of Cambridge, Massachusetts. He had been invited to give evidence by Philip Morris and had disputed the number, and therefore the cost to employers, of the nonsmoking lounges OSHA had proposed if their rule was enforced. OSHA estimated $68 million a year; Nichols said $7 billion. But McNeely was more interested in whether Philip Morris lawyers had vetted the draft of Nichols’s paper before he presented it to OSHA.

  MCNEELY: Did the draft come back changed or altered in any way?

  NICHOLS: It came back with some editorial suggestions.

  MCNEELY: Did [they] suggest that you use such terms as “alleged risk” instead of terms suggesting a causal relationship between ETS [environmental tobacco smoke] exposure and cancer and other diseases?

  NICHOLS: It’s not really an issue in regard to my testimony since all of my testimony and information was on the costs of the rule and had nothing to do with the risk side of the rule.

  MCNEELY: Well, you didn’t answer my question.

  NICHOLS: I guess I don’t see the relevance.

  MCNEELY: Judge, can I get him to answer my question, yes or no?

  JUDGE: If you know the answer would you tell him yes or no, if you can?

  NICHOLS: In a couple of cases they suggested that we use “alleged” before we used the word “risk.”

  MCNEELY: You did in fact alter the terms in accordance with the tobacco company’s editorial comments, is that correct?

 
NICHOLS: Well, actually it was not the tobacco company, it was some of the attorneys. As I said, we did make some editorial changes, and some of them were of the nature of referring to modifying “risk” by “alleged” or “purported.”

  MCNEELY: Well, would you please identify each and every attorney that reviewed your original submission draft for editorial comment.

  JUDGE: Why, Mr. McNeely?

  MCNEELY: I’m trying to find out who wrote this report, your honor.

  McNeely admitted later that asking about the word “alleged” had been a guess on his part. The tobacco company lawyers were not amused; they wouldn’t even get into the same elevator with the Torpedo Team. But Motley had shown them something of what was to come. He was aching to have a chance to cross-examine the industry’s officials, but by the end of November the tobacco companies had had enough of the Torpedo Team. They started to withdraw their witnesses—and then themselves. Philip Morris wrote a letter to the judge complaining about Motley and the efforts of plaintiffs’ counsel “to misuse the hearing process for purposes of advancing their own personal and monetary interests.” It was only the beginning of the chase.

  * * *

  WHEN JUDGE OKLA JONES of the New Orleans District Court certified the Castano case for trial in February 1995, he admitted he really didn’t know how it would all turn out. “With this decision, the Court embarks on a road certainly less traveled, if ever taken at all,” he said, referring to Robert Frost’s poem. He was bound by Rule 23 of the Federal Rules of Civil Procedure: A class action must have too many plaintiffs to conduct individual trials; the claim must be typical of the class as a whole; and the representatives of the class must be able to safeguard adequately the interests of the class. Rule 23 adds two more conditions, which are known as “predominance” and “superiority.” Under the first, questions of law common to members of the class must “predominate” over questions affecting individual members. In other words, if members of the class come from different states, which have different tort laws, the class action may not be an appropriate form of seeking justice. Under the second condition, the class approach must be “superior” to other methods available for the fair and efficient adjudication of the claims. It must be a better way for the courts to handle large numbers of claims.

  The tobacco companies had argued that the number of smokers involved—tens of millions from all over the country—each needing individual medical diagnosis for alleged nicotine dependence, could not possibly fit the conditions of predominance and superiority. Differences in state laws apart, it should be clear that nicotine addiction, or habituation, or whatever you want to call it, varied greatly from one person to another. Even if a trial decided that nicotine was an addictive substance, each individual would have to prove nicotine addiction and that would clog up the courts for decades.

  But Judge Jones decided to be creative and, as he put it, “look forward and invent” a way to process the claims as a class. Essentially, he split the lawsuit into two parts. The first would be a single trial of the claim that nicotine was addictive and that the tobacco companies had fraudulently failed to inform smokers of this fact, despite their possession of such knowledge. If the tobacco companies won that trial, the suit would be over. If they lost, Judge Jones envisioned a second series of trials to assess potential damages, but he took the option, which Rule 23 provides, of deciding how those second trials would be managed after the resolution of the first one. This was a progressive reading of the rules from a liberal judge, and the tobacco companies pounced on it and appealed immediately. A hearing on the appeal was set for April 2, 1996—a week after Texas became the seventh state to file a Medicaid case.

  As the lawyers prepared their appeal arguments, Judge Jones died suddenly from leukemia. Although he would not have been involved in the appeal, his death seemed a bad omen for the Castano camp. The hearing was to be before three judges of the Fifth Circuit: Jerry Smith and John Duhe, both Reagan appointees, and Harold DeMoss, appointed by President Bush. Most legal experts, and the Castano lawyers themselves, assumed they would be bound by recent negative trends in class-action rulings.

  One such class action in Chicago was particularly relevant. It involved 10,000 hemophiliacs who had been infected by the AIDS virus through blood transfusions. Nearly 2,000 had died of AIDS. The hemophiliacs formed a class action and sued the five national drug companies that had supplied blood-clotting additives. They claimed that the companies knew the product was contaminated with HIV. The lower court had suggested the same procedure that Judge Jones had recommended for Castano—a two-step trial. In the first, a jury would determine whether the drug companies had been negligent; if so, the class action would be allowed to pursue individual claims for damages in separate trials. The drug companies appealed.

  The Seventh Circuit rejected the class action. In the decision, Judge Richard Posner said the issues of negligence could not be decided in a class action because the hemophiliacs came from all over the country and the fifty states have different laws governing negligence; as such, it would be impossible to adopt a single legal standard for the class. In other words, questions of law did not “predominate” throughout the class. The tobacco companies seized on Posner’s argument and would use it against Castano in their appeal.

  When the hearing opened, the federal courtroom on Poydras Street in downtown New Orleans was packed with more than a hundred and fifty lawyers, reporters, and Wall Street analysts. The media examination of the industry had been in full cry for months, and tobacco stocks had been reacting wildly to every tidbit of information—a new, embarrassing document, additional states suing for Medicaid costs, or rumors of more tobacco industry whistle-blowers. Roy Burry, an analyst for Oppenheimer & Company, observed, “There are billions of dollars at stake here. Everyone is reading the tea leaves.” The tobacco stock analyst Gary Black could no longer contain his contempt for the Castano lawyers and declared, “It’s a wonderful day. It’s a very conservative panel. It dramatically increases the odds that Castano will go away.”

  The industry was defended by Kenneth Starr, a former U.S. solicitor general and the Whitewater independent counsel. Starr had been criticized for accepting the brief. How could he work for the tobacco industry and investigate alleged wrongdoings by an antitobacco president? asked his critics. Surely there was a conflict of interest? Not at all, said the confident Mr. Starr, who was an old tobacco industry campaigner. He had been counsel for Brown & Williamson in 1994 when they issued subpoenas against Congressmen Waxman and Wyden over the leak of the Merrell Williams documents. He had lost that battle in a Democratic Congress, but in New Orleans he was sure of victory. Gauthier was in the corridors, building up confidence among the Castano group. But even he looked nervous.

  Starr walked into the court smiling, a noticeable spring in his step as he greeted the usual band of thirty or so industry lawyers. They looked less tense than the last time they had been in New Orleans for the certification hearing in December 1994. They seemed to smell a victory. Starr launched into a barrage against the Castano action. It was an “an extremely novel claim,” he told the three-judge panel, a claim which had not been properly tested in the courts and was therefore unworthy of a class action. “This case is woefully premature,” he argued, “and [the claims] so overwhelmingly individualized that it should collapse.”

  As to the matter of alleged nicotine addiction, Starr said, “The very concept of addiction is complex. It is elusive with definitions [of addiction] shifting over the decades covered by the complaint.” Moreover, nicotine addiction was so overwhelmingly individualized that the whole idea of nicotine addiction as a cause of legal action should be tested in state courts before entertaining any thoughts of a national class action.

  Elizabeth Cabraser, the petite San Francisco attorney with an encyclopedic command of class actions, argued the case for Castano. Cabraser’s central point was disarmingly simple. This case was about “fraudulent statements” from the industry. Suc
h a charge was amply supported by new evidence, she said. Taking Starr’s objection that the claim of addiction was a “novel claim,” she said, “Our claim is not a new claim in law. It’s a fraud claim. What’s novel about the claim is the facts that support it: facts that smokers in traditional trials have not had before, facts which were known to the defendants and were suppressed, and facts that have begun to emerge within the last two years.”

  Unwieldy though the class action was—tens of millions of addicted smokers, perhaps—Cabraser argued that Judge Jones had selected an appropriate two-step method of dealing with the cases. There was nothing in Judge Jones’s certification that suggested there would have to be multiple trials in many jurisdictions. On the contrary, Judge Jones had deliberately deferred what happened “down the road not taken” until after the trial to establish whether nicotine was addictive and whether the companies had covered up that fact.

  The Fifth Circuit judges were clearly not impressed by Cabraser’s position. They were preoccupied with the problems posed by nicotine addiction and by the varying laws governing negligence in the fifty states. Was Castano not “so complex and individualized” as to be unworkable? they asked. Had Judge Jones not been “cavalier” in his treatment of its complexities down the road? Judge Duhe, himself a former smoker, thought that “considerably more analysis should have been presented” by Judge Jones on the issue of how to conduct the second trials.