December 16, 2008
Some 40 lawsuits against Altria, formerly known as Philip Morris, can go forward against the tobacco company, the U.S. Supreme Court has ruled. The justices voted 5-4 to allow suits in state court that charge Altria used deceptive advertising for its "light" cigarettes.
The high court found that the Federal Cigarette Labeling and Advertising Act does not preclude suits in state courts. The company had argued the law required any cases to be tried in federal court.
At issue is whether Altria knowingly set out to deceive consumers into thinking their light cigarettes were less harmful than regular brands. The suit claims that the company's Marlboro and Cambridge Lights were both packaged and marketed in a deceptive manner, to convince smokers they would be exposed to lower levels of tar and nicotine.
Writing the majority opinion, Justice John Paul Stevens said the court was ruling only on whether the lawsuits would be allowed to go forward, not on the merits of the case. Stevens, joined by Justices Anthony Kennedy, David Souter, Ruth Bader Ginsburg and Stephen Breyer, said the federal labeling law passed by Congress four decades ago was not intended to shield cigarette makers from challenges in state courts.
Altria issued a statement after the ruling, saying it sees the litigation over its "lights" marketing as manageable. It noted that the lawsuits still faced challenges, including the lack of cooperation by some states that are balking at granting class-action status.
The tactic of attempting to block state lawsuits against companies by using federal law, called "preemption," has come under increased scrutiny in recent years. Companies ranging from the wireless to pharmaceutical industries have attempted to "preempt" state-level class actions through claims that existing federal law preempts the states from taking action.
Various industries have heavily lobbied Congress to pass federal laws that govern everything from data breaches to damages from faulty medical technology, ostensibly to make it easier for companies to do business in multiple states. Critics say the tactic is designed to put weaker laws in place at the federal level to prevent lawsuits or class actions at the state level.
