Forcing cigarette makers to spend billions of dollars on a stop-smoking campaign would be an ineffective way to curb future wrongdoing, an economist testified on 31 May 2005 in the government's racketeering trial against major tobacco companies.

A remedy sought by the government that would require the industry to fund a smoking cessation campaign would do nothing to blunt future misconduct of tobacco companies and could instead hurt innocent "third parties," testified University of Chicago accounting professor Roman Weil. "Whether (major cigarette makers) survive at a reduced level or whether the remedies bankrupt them, the shareholders, creditors, employees and retirees (to the extent that the pension funds are underfunded) of the defendants will suffer," Weil said in pre-written testimony before US District Judge Gladys Kessler.
Weil also criticised two other remedy ideas put forward by government witnesses: Forcing the tobacco companies to pay for anti-smoking advertisements or imposing fines on them if youth smoking rates do not fall to pre-set levels.
Weil was the fifth witness the cigarette makers have called to testify against potential remedies the government wants Kessler to impose if she concludes tobacco companies conspired to deceive the public about the dangers of smoking.
One government witness has said the major tobacco companies should be forced to fund a 25-year, US$ 130 billion program to help smokers who want to quit.
The trial, which began in September, is scheduled to wrap up next week with closing arguments.
Targeted in the lawsuit, filed in 1999, are Altria and its Philip Morris USA unit; Loews Corp.'s Lorillard Tobacco unit, which has a tracking stock, Carolina Group; Vector Group’s Liggett Group; Reynolds American Inc.'s RJ Reynolds Tobacco unit and British American Tobacco unit British American Tobacco Investments Ltd.
The companies deny they illegally conspired to promote smoking and say the government has no grounds to pursue them after they drastically overhauled marketing practices as part of a 1998 settlement with state attorneys general. In February, an appeals court barred the government from seeking US$ 280 billion in past industry profits and said any remedies would have to be forward-looking measures designed to prevent future violations. Under cross examination by a government lawyer on 31 May 2005, Weil conceded he had not delved into the specifics of the case in reaching some of his opinions. But Weil said the idea of requiring the company to make payments to fund a national smoking cessation program was backward-looking and provided the industry with no new incentive to avoid misconduct in the future. He said forcing the major tobacco companies to make such unconditional payments would cause them to lose market share to other smaller manufacturers, who would not be subject to the remedy because they were not defendants in the case. (pi)