Man who won in US advises Irish to take on tobacco giants

Steve Berman spent six years battling Big Tobacco in the US

Steve Berman spent six years battling Big Tobacco in the US. He represented 14 US states in a legal action which eventually led to a 1998 settlement for more than $200 billion. And he believes the Government could do the same here.

He estimates a proposed legal action by the Government against the tobacco industry to recoup the cost of treating people harmed by smoking could net £18 billion.

The Attorney General, who will decide if such an action should proceed, has referred it to independent senior counsel for their opinion. They are expected to report in the autumn.

The proposed action would make the State the only country outside the US to bring a case against the tobacco industry. Berman says he would underwrite a "significant portion" of the cost of the proposed case, which solicitors estimate would cost £6 or 7 million, and would last three years.

As well as the financial backing, Berman brings the necessary expertise for the potentially lengthy and costly litigation against the industry.

He graduated from the University of Michigan in 1976 and the University of Chicago Law School in 1980. Last year, he was named by the National Law Journal as one of the top 100 most influential lawyers in the US.

Berman (46), who is married with two sons, is best known for his work against Big Tobacco, which brought him and his firm considerable revenue. As part of the eventual master settlement agreement between 49 states and US industry, the tobacco companies paid his fee.

Forbes magazine last year said: "Berman lobbied attorneys general and undercut other firms' bids to get a piece of the tobacco action. His firm, Hagens Berman . . . will collect an average $10 million a year for 25 years".

But, this is not his only motivation. "Berman believes in what he is doing. He seems to be genuinely abhorred by the behaviour of the tobacco companies," said Dr Fenton Howell, chairman of ASH Ireland, the anti-smoking organisation.

The Governments in the UK, Germany, Spain, and Australia have examined the possibility of a State case, but have so far decided there is no basis for such action. All will closely watch how the situation unfolds here - as Berman has said the State's case may "be a bridgehead into Europe".

At a press conference in Dublin this week, Berman commented on the political pressure to take legal action against the tobacco industry which is already evident in the State.

A 1999 report by the Oireachtas Committee on Health and Children said the State should consider pursuing tobacco companies for the cost of treating tobacco-related illnesses.

The same evidence used in the US would be used here, said Francis Fitzpatrick, a partner in the Dublin solicitor firm, Ward & Fitzgerald, who are in partnership with Mr Berman. They are currently lobbying the Government to take the case on the State's behalf.

Included would be evidence of a causal link between smoking and the incidence of cancer, for example, said Mr Fitzpatrick.

"The Government has a very winnable case" - because of the similarities between the US and Irish legal systems, which are both based on common law, said Mr Fitzpatrick. Because of the law applied in common law systems, it is "more likely precedents [in the US] would be followed" in the State, he said.

Another advantage of taking the case in Ireland concerns the timescale during which claims for injury can be made.

Under the Statutes of Limitation in the State, a claim for damages must be made within three years of the injury being inflicted. This rules out claims for smoking related injuries which may have been occurred decades ago.

However, recent sex-abuse cases have been heard in court because the Oireachtas amended the statute and allowed the cases to be heard. "Similarly, legislation could be enacted to extend the statute for tobacco related claims," said Mr Fitzpatrick.

He envisages defendants in the proposed action would be PJ Carroll, Gallaher, Benson and Hedges, and John Player. Research by the solicitors has shown that, within the last 60 years, these were the main tobacco companies supplying the State's market.

Furthermore, possible legal action by the State against pharmaceutical companies, arising out of investigations by the Lindsay tribunal, could create a precedent for the proposed State tobacco action, said Mr Hugh Ward, a partner in Ward & Fitzpatrick.

Phil Mason, managing director, PJ Carroll & Company Ltd, said: "We do not believe there is a case for a State action against the tobacco industry in Ireland.

"We believe that the way forward lies through sensible regulation and not through litigation, which we believe is indefensible from a legal, factual and public health policy perspective".

One result of a successful case would be an enormous loss of revenue for the Government, said Mr Mason.

Tax and excise duty from cigarettes generated more than £1 billion for the Government in 2000. This money would not be recouped through the reduction in treatment costs of smoking related illnesses if a State case were successful, as "people will continue to smoke", he said.

Any settlement would lead, as it did with the master settlement agreement in the US, to an increase in the price of cigarettes, he said.

This, in turn, would lead to an increase in the amount of contraband cigarettes being sold in the State - leading to a further loss of revenue for the Government.

But this has not happened in the US after the agreement, due to the comparatively low price of cigarettes in the US, said Mr Mason.

Tobacco companies insist the settlement in the US was a business decision, made in the face of political pressure and adverse public opinion - not an actual defeat in court.

But Mr Berman pointed out that all cases were settled on the steps, as the companies knew they would lose.

He said the aim here is to force the companies into a situation similar to that in the US where they were in a position where "it was too risky, politically or financially, to proceed".