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Judges Rule Liggett Must Turn Over Documents

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Reuters

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Mar 25, 1997, 3:00:00 AM3/25/97

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<A HREF='http://www.clari.net/'>ClariNet</A> <CLARI-ITEM TYPE>story</CLARI-ITEM> <CLARI-ITEM SLUGWORD>BUSINESS-TOBACCO</CLARI-ITEM> from <CLARI-ITEM FROM>Reuters</CLARI-ITEM> 
<H1><CLARI-ITEM HEADLINE>Judges Rule Liggett Must Turn Over Documents</CLARI-ITEM></H1>
<CLARI-ITEM COPYRIGHT>Copyright 1997 by Reuters</CLARI-ITEM> / <CLARI-ITEM DATE>Tue, 25 Mar 1997 3:54:11 PST</CLARI-ITEM>
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 NEW YORK (Reuter) - Judges in three states ruled against the
tobacco industry and ordered that Liggett Group must turn over
sensitive internal documents under seal for their review.
 The rulings Monday by judges in Illinois, Texas and
Mississippi followed Liggett's historic agreement last Thursday
to turn over the potentially damaging documents as part of a
settlement with 22 state attorneys general who have sued the
major cigarette makers to recoup Medicaid costs of smokers.
 The judges in Mississippi and Texas also issued orders
preventing the tobacco companies from taking any legal action
against Liggett for releasing the documents to the courts for
judicial review.
 A fourth judge in Superior Court in Phoenix, Arizona, set a
hearing for Friday at which time he may decide whether to order
Liggett to turn over the documents for his review, said a
spokewoman for the Arizona attorney general.
 Under the settlement, the documents will be given to judges
who will determine whether the documents can be used as evidence
or if they are protected by attorney-client privilege.
 Steve Berman, a Seattle lawyer assisting the attorneys
general, said the tobacco industry had sought emergency hearings
to block the release of the documents to the courts. The
attorneys general then filed counter motions seeking orders to
compel Liggett to turn over the documents.
 ``We really kicked their butts,'' Berman said.
 In Illinois, the attorney general obtained a ruling from
Cook County Circuit Judge Richard Neville ordering Liggett to
turn over the documents under seal by Friday for his review.
 ``This is a distinct victory for the people of Illinois, who
have a right to prosecute their case against tobacco,'' said
David Kistenbroker of the state attorney general's office.
The tobacco industry had quickly obtained a restraining order
last Thursday from a North Carolina state court preventing
Liggett, which is owned by Bennett LeBow's Brooke Group Inc.,
from handing over documents that might reveal joint legal
defense efforts by the cigarette companies.
 The manufacturers are now in the process of asking various
courts to honor that injunction.
 A source close to settlement talks told Reuters that boxes
of documents have already been shipped to several states,
including Mississippi, Florida and Texas, where trials are
scheduled to begin this year.
 Some documents also have been sent to the Department of
Justice, which is conducting a criminal investigation into
whether the industry withheld information from government
agencies about health risks of smoking, government sources said.
 The industry argues that the documents must be kept secret
because they are the result of confidential communications
between lawyers and their clients.
 The attorneys general, however, have played down the
importance of the injunction. During a news conference last week
to announce the settlement, they said the injunction was not
binding on courts in other states.
 They also said the documents would not be protected if they
were found to contain evidence of crime or fraud.
 Mississippi Attorney General Mike Moore, who is
spear-heading the Medicaid litigation, said he was confident the
North Carolina injunction would not stop the release of the
documents.
 ``That dog won't hunt,'' he told the news conference.
 The Mississippi trial is the first scheduled to proceed, on
June 2.
 In Florida, attorneys involved in the state's Medicaid suit
said Monday they want court-appointed special master William
Rutter to review the Liggett documents in private.
 Rutter has reviewed scores of other internal industry
documents for the trial judge, Palm Beach County Circuit Court
Judge Harold Cohen, and would recommend to Cohen whether all
Liggett documents, none of them, or only some of them should be
used at trial.
 Lawyers said the Liggett documents would be discussed at a
hearing before Rutter on Wednesday morning in West Palm Beach,
Fla. Florida's suit is scheduled for trial beginning Aug. 4.
 Last Friday Dade County, Fla., Judge Alan Postman said
during a pre-trial hearing in a separate, class-action suit
against tobacco companies that he wanted to see the Liggett
documents as soon as possible.
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