Memorandum Of Law Of The Commonwealth Of Pennsylvania In Opposition To The Amended Petition To Intervene Of Robert B. Sklaroff, M.D., William T. Godshall, Jeffrey Barg And Petition To Intervene Of Smokefree Pennsylvania And PennPIRG
Memorandum Of Law Of The Commonwealth Of Pennsylvania In Opposition To The Amended Petition To Intervene Of Robert B. Sklaroff, M.D., William T. Godshall, Jeffrey Barg And Petition To Intervene Of Smokefree Pennsylvania And PennPIRG
IN THE COURT OF COMMON PLEAS
APRIL TERM, 1997
COMMONWEALTH OF PENNSYLVANIA
BY D. MICHAEL FISHER, IN HIS OFFICIAL CAPACITY AS ATTORNEY GENERAL OF THE COMMONWEALTH OF PENNSYLVANIA
PHILIP MORRIS, INC.; R.J. REYNOLDS TOBACCO COMPANY; BROWN & WILLIAMSON TOBACCO CORPORATION; B.A.T. INDUSTRIES, P.L.C.; THE AMERICAN TOBACCO COMPANY, INC. c/o BROWN & WILLIAMSON TOBACCO CORPORATION; LORILLARD TOBACCO COMPANY; LIGGETT GROUP, INC.; UNITED STATES TOBACCO COMPANY; THE TOBACCO INSTITUTE, INC.; THE COUNCIL FOR TOBACCO RESEARCH-U.S.A., INC.; SMOKELESS TOBACCO COUNCIL, INC.; and HILL AND KNOWLTON, INC.
MEMORANDUM OF LAW OF THE COMMONWEALTH OF PENNSYLVANIA IN OPPOSITION TO THE AMENDED PETITION TO INTERVENE OF ROBERT B. SKLAROFF, M.D., WILLIAM T. GODSHALL, JEFFREY BARG AND PETITION TO INTERVENE OF SMOKEFREE PENNSYLVANIA AND PENNPIRG
Plaintiff, the Commonwealth of Pennsylvania, hereby responds in opposition to the Amended Petition to Intervene by Robert B. Sklaroff, M. D., William T. Godshall, Jeffrey Barg, and Petition to Intervene of "SmokeFree Pennsylvania" (which Mr. Godshall heads) and PennPIRG, as follows:
The Commonwealth of Pennsylvania, along with forty-five (45) other states, has entered into a Master Settlement Agreement (MSA) settling the litigation brought against the tobacco industry. The MSA has been filed in this Court, together with a Joint Motion to Approve the Settlement and Consent Decree as called for by the Agreement. The MSA establishes noneconomic relief, restricting the marketing of tobacco to minors and funding anti-smoking education and research, that is unprecedented in United States civil litigation. In addition, the settlement contains financial terms that represent the greatest recovery of damages by far in United States history. Pennsylvania's allocated share of the recovery itself amounts to $11.26 billion over the first twenty-five (25) years, making it far and away the largest recovery in Pennsylvania history. 1 In addition, a separate settlement agreement was entered into with United States Tobacco Company (UST) covering smokeless tobacco. The Smokeless Tobacco Master Settlement Agreement (STMSA) provides all the same prospective relief (modified as necessary to cover smokeless tobacco), and requires UST to pay at least $100 million into a national antitobacco foundation created by the MSA. 2
Now three individuals and two organizations seek to intervene and disrupt the process of approving the settlement, claiming the settlement adversely affects their legally enforceable
1. Not only are the financial and non-financial terms of the settlement historic, but rarely in the history of the United States have all of the states acted together in such unanimity on any issue.
2. Petitioners have not challenged the Smokeless Tobacco Settlement Agreement in any respect, even though it contains the same definition of "Releasing Party" that petitioners object to in the MSA.
interests, even though they are unable to articulate what claims they could assert against the tobacco companies.
Petitioners Robert B. Sklaroff, M.D., William T. Godshall and Jeffrey Barg initially filed a pro se Petition to Intervene, seeking to enjoin the settlement so that they could "air [their] concerns" regarding its terms. They also sought a hearing on November 25, 1998. However, this Court entered an order canceling the proposed hearing for that date, and specified that the Petition would be considered at the time that the parties moved for approval of the settlement, which they have now done? 3
The three individuals are joined in the Amended Petition by the apparently tobacco-abolitionist organization that Petitioner Godshall heads, "SmokeFree Pennsylvania", and by PennPIRG. These anti-tobacco activists are thus asserting their opposition to the tobacco settlement, despite the fact that the settlement will bring payments to the Commonwealth of Pennsylvania under the settlement in amounts unprecedented in the history of Pennsylvania .litigation, which, consistent with the Consent Decree's articulated intent of the parties, the legislature can budget for smoking cessation programs, anti-tobacco, public education, youth antismoking advertisements, education programs and enforcement campaigns, and research into tobacco-related diseases at heretofore unparalleled levels. Such programs will result in the
3. At the same time that the initial Petition to Intervene was filed, a second pleading was filed entitled "Petition for Injunctive or Special Relief." Despite the title, however, that pleading was literally nothing more than the identical Petition with a different title and first page on it. As such, this "Petition!' contains NO request for injunctive relief, NO reference to the applicable Rules of Civil Procedure for Injunctive Relief, (Pa. R.C.P. 153 1), NO discussion of the standards for obtaining injunctive relief, and NO explanation for why such relief should even be considered by the Court. Given that Petitioners have filed an amended Petition to Intervene, with assistance of counsel, and have not incorporated or referred to any injunctive relief, or amended the Petition for Injunction, the request for injunctive relief is moot.
savings of lives and reduction of disease in Pennsylvania. 'Me settlement terms also require the removal and banning throughout Pennsylvania of all tobacco advertising billboards, all transit tobacco advertisements and tobacco brand sports sponsorships, and the use of cartoon characters in tobacco advertising, as well as a host of other reforms which will hopefully also cumulatively result in the savings of lives and reduction of disease in Pennsylvania. If successful, the Amended Petition to Intervene would threaten all of this, as set forth below.
The Amended Petition to Intervene currently pending was filed on December 2, 1998, this time by counsel for Petitioners, and now also purports to be on behalf of a class of individuals and entities. The Amended Petition challenges only a single provision in the 146-page MSA, pertaining to the scope of the claims being released which is embodied in the definition of "Releasing Parties". Petitioners have requested that the Court delete or modify that provision.
A. The Terms Of The Unprecedented Settlement
Upon approval of the settlement by this Court, the Commonwealth of Pennsylvania will become entitled to receive approximately $11.26 billion over the next 25 years, plus annual payments thereafter potentially over $500 million per year -- easily the largest recovery in Pennsylvania history. The Agreement also prohibits the tobacco defendants from lobbying the Pennsylvania Legislature for the diversion of the settlement funds to non-tobacco or non-health related uses. The legislature can direct that these funds be invested, in unprecedented amounts, in smoking cessation programs, education programs, tobacco related health and disease research
programs, anti-tobacco advertising programs, Youth anti-tobacco advertising, education, and enforcement.
In addition, upon approval of the settlement by this Court, a multitude of far-reaching restrictions on advertising and marketing and other non-economic relief will be implemented in Pennsylvania, most of which are beyond any relief that this Court could order or that a civil jury could award:
*No defendant will be able to directly or indirectly advertise, promote or market tobacco products to the youth of Pennsylvania;
*As of 180 days from November 23, 1998, the use of cartoon figures in the advertising, promoting, packaging or the labeling of tobacco products in Pennsylvania will be banned;
*As of November 23, 1998, no defendant -will be permitted to engage in Pennsylvania in any brand name sponsorship of concerts, or of athletic events in football, basketball, baseball, soccer, or hockey, or of any event in which the intended audience are minors;
*Within 150 days of November 23, 1998, the defendants will remove all outdoor billboards in Pennsylvania advertising tobacco products;
*Within 150 days of November 23, 1998, the defendants will remove all signs and placards in Pennsylvania advertising tobacco products, in arenas, stadium , shopping malls, and video games arcades, which signs and placards will thereafter be banned in Pennsylvania;
*Within 150 days of November 23, 1998, the defendants will remove all transit advertisements of tobacco products, which tobacco advertisements will thereafter be banned in Pennsylvania;
*Within 30 days of November 23, 1998, the tobacco defendants are banned from making any direct or indirect payments for the use or display, of any tobacco product or any in any motion picture, television show, theatrical production or other live performance, live or recorded music performance, commercial film or video or video game; and
*As of November 23, 1998, no defendant may distribute or cause to be distributed any free samples of tobacco products in Pennsylvania except in an adult-only facility.
In addition, upon approval by this Court, the settlement would ban in Pennsylvania on the distribution or sale of non-tobacco merchandise containing tobacco brand names, logos (T-shirts, backpacks, etc.), would establish a minimum pack size of no less than 20 cigarettes per pack through March 31, 2001 (to give the Pennsylvania Legislature an opportunity to extend this provision permanently through legislation) and would ban gifts to minors in exchange for the purchase of tobacco products, coupons or proofs of purchase and bans distribution of gifts through the mail without proof of age (legible driver's license certified to be valid by the gift recipient).
In addition to the many marketing restrictions, the settlement calls for the separate creation of a national foundation and national education fund to be separately funded by the defendants in the amount of $1.45 billion, whose mission is reduction of tobacco product usage among minors and the development of programs to prevent tobacco related diseases.
Finally, the settlement and Consent Decree eradicates the very conduct by the defendants that caused the Attorneys General to bring these lawsuits, and creates a right of enforcement in every state through the Consent Decrees to stop the tobacco manufacturers from making any future misrepresentation as to tobacco and health, to stop any future conspiracy to suppress or limit research on smoking and health, and to enjoin any violation of the permanent relief described above.
B. Petitioners Are Opposed To The Settlement
While petitioners contend that they seek only to have certain minor language deleted from one provision of the MSA, and "do not seek to block the proposed settlement," in fact, the relief the petitioners seek will likely do exactly that--block the approval and quite likely cause termination of the MSA as to Pennsylvania.
The petitioners seek to modify the definition of "Releasing Parties", an essential term to § XII of the MSA, which contains the release provisions. 4 This provision is specified as non-severable under § XVII(o), and any modification to that provision would give the tobacco manufacturers the right to terminate the entire settlement as to Pennsylvania. 5Thus, the modification that petitioners are seeking could result in Pennsylvania being excluded from the monetary and non-monetary benefits of the MSA, which the rest of the nation will be enjoying.
Despite the moderation professed in the Amended Petition, Petitioners are avowedly anti-settlement. Their true intent was revealed as recently as December 1, in their editorial published in The Philadelphia Inquirer. That editorial, a copy of which is attached, begins: "The proposed tobacco settlement should be rejected because it contains outrageous and unprecedented legal and legislative protections for the industry, short changes taxpayers, and allows the tobacco
4. Those provisions, as set forth below, release not merely claims brought by the Commonwealth itself, but also any claims brought by individuals or entities seeking the same type of damages that the Commonwealth was asserting--recovery for state medical expenses for tobacco related disease, and relief generally applicable to the general population of Pennsylvania.
5. Under §XVII(o), if a court materially modifies a non-severable term, such as the release provisions in §XII, a team of Attorneys General will be appointed to attempt to negotiate a substitute term satisfactory to the tobacco manufacturers. However, the manufacturers have no obligation to agree to any substitute term, and if the negotiation is not successful, the entire MSA is terminated as to Pennsylvania.
companies to continue to prey on our children." Godshall, Sklaroff and Barg, "Tobacco Settlement Leaves For Too Much Unsettled," Philadelphia Inquirer Dec. 1, 1998, at A- 19. While they are entitled to hold whatever views they want regarding tobacco, the views expressed in the editorial do not take into account the reality that there are uncertainties, delays and limitations inherent in this litigation: uncertainties due to the vigorous challenges asserted by the defendants against the legal theories and damage model of the state tobacco litigation; delays due to the time necessary to fully litigate this case, including likely appeals; and limitations as to the financial recovery available, and especially the prospective injunctive relief available through jury verdicts. Here, as discussed in the Commonwealth's Memorandum of Law In Support of Joint Motions to Approve the Settlement, the Commonwealth's recovery of $11.26 billion is well beyond what the Commonwealth could reasonably have recovered at trial, even if fully successful, and the settlement's significant and unprecedented reforms and non-economic relief are far beyond what this Court could have imposed.
Petitioners do not reflect the view of the public health community, let alone the view of the general public, many of whom have recognized the value of this historic settlement in advancing the cause of tobacco control. For instance, Philadelphia-based tobacco-control activist, Rev. Jesse W. Brown, Jr. (coincidentally, the lead plaintiff in the pending federal class action lawsuit against the tobacco industry in which Petitioner Sklaroff is a "consultant"), praised the settlement for the important provisions removing tobacco billboards and other target marketing messages from African-American communities as follows:
The African-American community has been battling against tobacco billboards for more than a decade - through the Courts, through legislation, through community-based programs and through direct action on the streets. This is a very important issue for us .... Today we can
celebrate the removal in the next 150 days of all tobacco billboards from neighborhoods and transit systems in 50 States, the Territories and the District of Columbia. Taking down images of supposedly healthy black people smoking menthol cigarettes that are on virtually every comer in low-income neighborhoods is an important step. Removal of the tobacco billboards not only decreases the marketing to children but it lessens the constant visual cues that make it difficult for adult smokers to quit
See National Association of African-Americans for Positive Imagery: After Decades-Long Struggle, Tobacco Billboards Will Come Down, Press Release (Nov. 23, 1998), attached in Exhibit "A". Godshall and the other Petitioners' requested relief would seriously risk terminating the MSA and thus, keep those billboards up.
Similarly, in the Philadelphia-based Onyx Group's study of "The Potential Impact of the Multi-State Master Tobacco Settlement Agreement on the African-American Community," the authors conclude that with regard to the MSA's ban on all billboards and transit advertising of tobacco products: "This provision is particularly important to African-Americans since billboards have been used since the 1950's as a way to target the black community for tobacco use". The study specifically praised other provisions as well including: (I.) the MSA's prohibition on targeting youth in advertising, promotions or marketing, (2) the ban on naming cigarette brands after recognized non-tobacco brand or trade names or individual celebrities, (3) the elimination of all tobacco advertising, promotions, packaging or labeling using cartoons symbols, (4) the ban on payments to promote tobacco products in movies, television shows, theater productions or live performances, videos, and video games, and (5) the ban on free distribution and sale of nontobacco merchandise, including caps, jackets, or bags bearing the name or logo of a tobacco brand.
Just as local anti-tobacco activities have expressed support for the settlement, prominent national anti-tobacco groups are embracing the settlement as a major opportunity to advance their cause. For example, the President and Executive Vice Presidents of Campaign for Tobacco-Free Kids ("National Center for Tobacco-Free Kids") sent a letter to Christine Gregoire, Attorney General of Washington, noting that the MSA "represents one more step in the long battle to reduce the harms caused by tobacco and to make the tobacco industry play by the same rules that govern other industries," and further notes that the Agreement presents an opportunity for the Attorneys General and the public health community to work in close partnership "to ensure that the opportunity to reduce the death toll from tobacco presented by this new Agreement is maximized." These three documents are attached collectively hereto as Exhibit "A" . 6
C. The Provision Challenged by Petitioners
The provision being challenged by petitioners is § XII, "Settling States' Release, Discharge and Covenant." One of the core concepts in this provision is the definition of "Releasing Parties," which is what petitioners seek to modify. As the Amended Petition acknowledges, the concept of "Releasing Parties" includes not only the settling state itself, its agents, officials, representatives, agencies, departments and divisions, but two additional limited categories as well. The first category, which is what Petitioners claim wrongfully includes them and their putative class, includes:
6. Although we have provided examples of other views, even among the anti-tobacco community, what is presently before the Court is not a forum for publicly debating the tobacco "issue" in Pennsylvania, on which there are a full spectrum of differing views, but rather a motion to approve the settlement of a civil action on terms agreed to by the parties.
persons or entities acting in a parens patriae, sovereign, quasi-sovereign, private Attorney General, qui tam, taxpayer, or any other capacity, [but only to the extent that] such person or entity is seeking relief on behalf of or generally applicable to the general public in such settling state or the people of the state, as opposed solely to private or individual relief for separate and distinct injuries. 7 (emphasis added)
MSA, §II (pp)(pages 14-15). The second category, clearly not applicable to the individual Petitioners, covers entities the are:
seeking recovery of health care expenses (other than premium or capitation payments for the benefit of present or retired state employees) paid or reimbursed, directly or indirectly, by a Settling State.
Id. In addition to these limitations, the scope of "Releasing Parties" is further limited to cover only claims "to the full extent of the power of the signatories hereto [i.e., the Attorney General] to release past, present and future claims." Id. This limitation, which Petitioners ignore, is vital to understanding and applying the Release provisions of the MSA because it creates an overarching limit to what claims are being released.
Moreover, even without regard to this overall qualifier, the language of the provision reflects that the release applies-in those lawsuits seeking relief for "the general public" or "the people of the state" as opposed to private relief. Accordingly, the release does not apply, for instance, to class actions involving Pennsylvania's smokers, since that is not a lawsuit "generally applicable to the general public", or to Pennsylvania's consumers of tobacco products, since that is not a lawsuit "generally applicable to the general public", or to other Pennsylvanians who also have sustained injury or actual damage from exposure to or purchase of tobacco products, since
--- 7. Petitioners have failed to even suggest, let alone specify how they would have standing to bring a tobacco-related lawsuit in a parens patriae, sovereign, quasi-sovereign, private Attorney General, qui tam, or taxpayer capacity under Pennsylvania law.
that is not a lawsuit "generally applicable to the general public". 8 Similarly, this release provision only releases claims seeking recovery of health-care expenses to the extent that those expenses were paid for or reimbursed by the Commonwealth, which is as it should be, since those are Commonwealth expenses which are being reimbursed to the Commonwealth pursuant to its/this settlement. Therefore, it is hardly surprising that the Petitioners have failed to articulate any even-theoretical lawsuit that they could bring that would be released under this provision, and that would not have been within the Attorney General's power to release.
Based on this definition, section XII(b) of the MSA provides that if any Releasing Party (such as political subdivisions or individuals asserting claims for Commonwealth tobacco-related health care costs) nevertheless attempts to assert a claim against a Released Party, the tobacco company/Released Party being sued may notify the Attorney General for the applicable state, and if it is determined that the release is unenforceable as to the claim asserted by the Releasing Party, then:
(1) the settling state shall indemnify the Released Party to the fall extent of any settlement or judgment reached, if notice and an opportunity to consent were provided to the Attorney General, and if the Released Party defended the action reasonably.
(2) where the Released Party is an original participating manufacturer, any such settlement or judgment will give rise to a continuing dollar-for-dollar offset on the amount that that original participating manufacturer owes to that state.
8. While such claims would not fall within this release, statewide class actions on behalf of Pennsylvania smokers for smoking-related injuries, and on behalf of Pennsylvania smokers for medical monitoring have nevertheless previously been dismissed with class certification denied, by the Federal Courts in Pennsylvania. See, eg., Arch v. American Tobacco Co., 175 F.R.D. 469, 497 (E.D. Pa. 1997), aff' d sub nom. Barnes v. American Tobacco No. 97-1844, 1998 U.S. App. LEXIS 28624 (3d Cit. Nov. 16,1998).
(3) the settling states right to intervene is protected in such actions.
(4) the dollar-for-dollar offset will continue from year to year until entire judgment or settlement is offset.
Further, under § VII(a), disputes arising under these provisions will be adjudicated by this Court, which will retain "exclusive jurisdiction for the purposes of implementing and enforcing this agreement and the Consent Decree as to [Pennsylvania]" and "shall be the only court to which disputes under this agreement or the Consent Decree are presented as to [Pennsylvania]."
As this provision indicates, the determination of whether a particular claim is released by the MSA is a matter of case-by-case evaluation, once a claim is asserted against the tobacco companies, and once the MSA is pleaded as a bar to the claim. At that point, the question is whether the Attorney General had authority to release the claim. If he does, the claim is released and the terms of §XII(b) apply. If he does not, the claim can go forward against the tobacco companies.
This same argument regarding the scope of the definition of "releasing parties" was made by intervenors in the settlement of the Massachusetts state tobacco case. The Massachusetts Court, in rejecting the petition of the intervenors and approving the settlement as being in the "best interests of the Commonwealth" and "enormously beneficial", found the issues raised in connection with the release provisions to be "remote" and "hypothetical". The Court's comments on this provision are insightful:
As I read the Master Settlement Agreement, it seems to itself acknowledge that there is uncertainty as to the precise contours of that release because there is uncertainty as to the precise contours of the Attorney General's authority [to release claims] and presumably those contours are different in differing states depending upon what authority those state's law grant
their Attorney General. As I read the document, that is an issue that would have to be addressed if and when such a suit were to arise. There would first be a series of definitional issues about any particular suit that was brought: was it a suit brought by a releasing party as that term is defined in the agreement; is it against a released party, as that term is defined; is it based on a released claim, as that term is defined? And if all of those questions were answered yes, one would then have to address the issue, if so, is that beyond this particular Attorney General's authority.
The Master Settlement Agreement does not purport to make that precise decision, or even to give it terribly precise definitions at this stage. It would need to be addressed on a case-by-case basis. And I see no reason to hold-off on this settlement agreement because of that particular problem. One of the things that must be noted is that the bringing of such an action is a highly unlikely prospect [noting that it is unlikely that "municipalities, public hospitals, and other ... entities" are likely to have released claims.]
Setting aside that problem, I also note not one of them did anything to join in this case on their own, or to bring their own case while this matter was pending .... The notion that I should hold up this settlement for the theoretical possibility that ... they will now undertake that task all by themselves, strikes me as an unwise calculation. It is not a reason for me to find that this settlement agreernent is not in the state's best interest. It is remote. It is hypothetical. And it should not stand in the way of an otherwise enormously beneficial Consent Decree and final judgment.
See Transcript of Massachusetts Court Ruling approving settlement (December 3, 1998), attached hereto as Exhibit "B", at 22-25 (emphasis added).
Similarly, intervenors in Oregon raised, inter alia, the same objections to the release provisions before that Court. 9 In rejecting the intervenors' arguments and approving the settlement, the Oregon Court called the settlement "a stunning outcome for the people", and
9 Putative intervenor PennPIRG's Oregon counterpart, OSPIRG, was among the putative intervenors in Oregon, whose arguments were rejected by the Oregon Court.
found that interfering with the settlement as requested by the intervenors would be an abuse of discretion:
The Court is pleased, from both the perspective of the economy to the Court and the outcome for the people of the State, that the parties have been able to resolve this case. The Court is always pleased when the parties are able to resolve a case on their own, and in this matter, with the enormous risk and what I think is a stunning outcome for the people.
I don't know how the Court of Appeals could do anything but reverse as an abuse of discretion action I might take at the intervenor's request to disrupt the orderly conclusion of the case .... That is a wonderful thing that the case is resolved for the people in the sense that it has secured a known benefit that can be used for good, and it generates a public policy forum.
See Transcript of Oregon Argument and Ruling approving settlement (November 30, 1998), attached as Exhibit "C", at 51-53.
Nevertheless, Petitioners in this case claim that this provision infringes on their rights to such an extent that they should be permitted to intervene, even though they do not allege ever having filed a lawsuit against tobacco companies, and are not able to even articulate any type of claim that they intend to file. Rather, they indicate that their anti-tobacco work will include
either actually or potentially, public interest litigation against the tobacco defendants," and assert that " if they attempt to bring public interest litigation against the tobacco companies, [they] will be arguably included in the MSA's definition of releasing parties. Amended Petition, ¶ XI(a), (b)(ii) (emphasis added.)
III. SUMMARY OF THE COMMONWEALTH'S POSITION
Petitioners, strangers to this litigation, nevertheless seek to derail the settlement of the tobacco litigation in Pennsylvania. However, as set forth below, the Petition fails to raise a case
or controversy because the issue it raises is not ripe until such time as other hypothetical litigation is actually brought and a challenge is made in that litigation based on the MSA. In addition, neither Petitioners themselves, nor the class they purport to represent, have any standing to raise any challenge to the MSA at this point. Finally, the Petition fails to state a proper claim for intervention, since it is not intervention that Petitioners actually seek, but merely the right to come into the very end of this settlement process as strangers to the litigation and demand changes to the agreed on terms. In so doing, the Petitioners cannot satisfy any of the requirements for valid intervention. 10
A. The Petition Is Not Ripe
Pennsylvania law requires that an actual case or controversy exist before a matter is ripe for judicial review. "The ripeness doctrine is a concept of standing premised on the notion that '[j]udicial machinery should be conserved for problems which are real and present or imminent, not squandered on problems which are abstract or hypothetical or remote."' Van Doren v. Mazkurkiewicz, 695 A.2d 967,971 (Pa. Commw. 1997) (quoting Western Pennsylvania Co. v. Pennsylvania Pub. Util. Comm., 471 Pa. 347, 361, 370 A.2d 337, 344 (1977)). "The ripeness doctrine is another prerequisite for a court to exercise judicial review and examine the merits of a case. To be ripe, an actual case or controversy must exist at every stage of the judicial process." Treski v. Kemper Nat. Ins, Co. 449 Pa. Super. 620, 634, 674 A.2d 1106, 1113 (1996). 10 The
10. Even assuming, arguendo, that petitioners could satisfy said requirements (and they cannot), petitioners' intervention would still be improper in that it would prejudicially interfere with the agreed-to present and efficient determination of the underlying lawsuit. In such event, "intervention should be refused and the petitioner left to other proceedings for the vindication of his rights." Pa. R.C.P. 2329(3 )). Goodrich-Amram 2nd, § 2329:8, at p. 392.
court must consider whether the issues are adequately developed for judicial review and what hardship the parties will suffer if review is delayed.... The rationale of the ripeness doctrine is to prevent premature adjudications." Id. No type of judicial action whatsoever may be employed "to determine rights in anticipation of events which may never occur or for consideration of moot cases or as a medium for the rendition of an advisory opinion which may prove purely academic." Brown v. Commonwealth of Pennsylvania, 673 A.2d 21, 23 (Pa. Commw.), appeal denied, 546 Pa- 648, 683 A.2d 886 (1996).
In the instant case, Petitioners seek to intervene in the settlement proceedings because they or their putative class members "might bring public interest litigation against the tobacco companies in the future. . . . " Amended Petition at 11 (b) (emphasis added). Petitioners claim only that they "are likely in the near future to take similar actions or to assist others in doing so." Id. § 5. Petitioners fail to specify any past or current legal action instituted by Petitioners themselves, or even any other legal action which would be improperly effected by the MSA. 11 They cannot even articulate an identifiable cause of action that they will or could assert against the tobacco companies, let alone any such theoretical litigation that might fall within the definition of releasing parties and be beyond the authority of the Attorney General to release.
Without the filing of such potential future litigation against tobacco manufacturers or Released Parties, and the subsequent invoking of that provision, there is nothing that even potentially implicates the provision to which Petitioners object. Rather, in their effort to defeat
11. The Petitioners vaguely allege that the "petitioners have in the past taken actions or assisted others in taking actions against tobacco companies ... including actions to compensate the public at large... ." Amended Petition at 15. However, there is no specific reference to any prior litigation. In fact, this reference is so vague that it may not even be referring to any lawsuit at all, but could mean lobbying, protests, or anti-tobacco activities.
the settlement, Petitioners choose to rest their Petition to Intervene on a series of hypothetical facts that may never materialize, hypothetical lawsuits raising hypothetical claims against tobacco companies, in which hypothetical defendants raise hypothetical defenses that the MSA bars the hypothetical lawsuit. As the Massachusetts Court expressly found, these issues pertaining to the scope of the MSA's release provisions are "remote" and "hypothetical." See Exhibit "B", at 25.
Petitioners are asking this Court "to determine rights in anticipation of events which may never occur", Brown v. Commonwealth, 673 A.2d at 23) - precisely what the ripeness doctrine prohibits. Pennsylvania law makes clear that an actual case or controversy must exist before judicial relief will be afforded. Because the Petition to Intervene is premised on speculation and hypotheticals as to future actions, Petitioners have no active case or controversy for the consideration of the Court. Accordingly, the Petition to Intervene must be denied. Not only are Petitioners' concerns based on events that have not and may not occur, but even if those events do occur, the MSA provides a mechanism for the adjudication of just such claims -- should there ever be a real controversy. 12 If other litigation is filed by someone
12. It should be noted that requiring petitioners to wait until there is an actual controversy concerning the scope of Releasing Parties will not prejudice them in any way. As the court stated in Walls v. City of Philadelphia, 165 Pa. Commw. 174, 646 A.2d 592, 596 n.2 (1994):
[A non-partys] failure to intervene in a non-class action does not bind them to the [settlement]. 7 Goodrich Amram. 2d § 2327:1 (1992). Intervention is voluntary. Pa. R.C.P. No. 2327; see Martin v. Wilks, 490 U.S. 755 (1989) (rejecting the "impermissible collateral attack" doctrine that immunizes parties to a consent decree from discrimination challenges for actions taken pursuant to the decree by non parties who did not intervene).
Petitioners will not be barred from asserting that they are not releasing parties later, if they sue (continued ...)
identified as a Releasing Party, and if the MSA is raised as a bar to the suit, then the court will be able to make a fact-based determination on a case-by-case basis as to whether the release covers the plaintiff in the other litigation, as the Massachusetts Court observed. Significantly, the determination at that point will not only be factual rather than hypothetical, but in addition, the Court's ruling, no matter which way it goes, will not invalidate the overall settlement. By contrast, if the Court acts now and modifies parts of the Agreement, based on a series of speculative future events, then the entire Agreement may be terminated as to Pennsylvania. 13
B. Petitioners and Their Putative Class Lack Standing to Intervene.
Under the Pennsylvania Rules of Civil Procedure, intervention is permitted in four circumstances, 14 only one of which is even arguably implicated by Petitioners' averments. A
12 (. . . continued) the tobacco companies, and if the tobacco companies assert that the claims are released. To the contrary, the MSA explicitly recognizes that such controversies could arise -- in the context of actual litigation.
13 As of December 14, 1998, each of the thirty (30) state tobacco case Courts (plus Puerto Rico) that had ruled, had unanimously approved the Master Settlement Agreement which has these release provisions, including those states where, as here, there has been special interest group objection or intervention. The Courts that have unanimously approved the settlement and entered the Consent Decree as of December 14th are New Jersey, Ohio, Michigan, Illinois, Maine, Massachusetts, Connecticut, Maryland, Wisconsin, Iowa, Kansas, California, Oklahoma, Colorado, Arizona, Montana, Idaho, Washington, Oregon, Georgia, Nevada, Hawaii, Indiana, Louisiana, New Hampshire, Vermont, Arkansas, West Virginia, New Mexico, and South Dakota.
14 Pursuant to Rule 2327 intervention is permitted only if:
(1) the entry of a judgment in such action or the satisfaction of such judgment will impose any liability upon such person to indemnify in whole or in part the party against whom judgment may be entered; or
(2) such person is so situated as to be adversely affected by a distribution or other disposition of property in the custody of the court or of an officer thereof;
non-party is permitted to intervene in an action if "the determination of such action may affect any legally enforceable interest of such person whether or not he may be bound by a judgment in the action." Pa. R.C.P. 2327(4) (emphasis added). 15 The requirement of a "legally enforceable interest" reflects "the desire of the courts to prevent the curious and meddlesome from interfering with litigation not affecting their rights." Pennsylvania Railroad Co. v. Hughart, 422 Pa. 615, 618, 222 A.2d 736, 738 (1966).
1. Petitioners Have No Legally Enforceable Interest That Will Be Affected By The Settlement.
The claimed interests of Petitioners in the settlement of this litigation fall far short of the legally enforceable interests that would justify intervention. The mere "fact that the proceeding may, in some way, affect the proposed intervenor is not sufficient to invoke a 'legally
14 ( ... continued) or
(3) such person could have joined as an original party in the action or could have been joined therein; or
(4) the determination of such action may affect any legally enforceable interest of such person whether or not he may be bound by a judgment in the action.
Pa. R.C.P. 2327. In order to intervene during the pendency of an action, the petitioner must fall within one of the four classes of persons set forth above. In re Subpoena of Pennsylvania Crime Commission 453 Pa. 5 13, 309 A.2d 401 (1973).
15 Whether or not a party will be allowed to intervene is within the discretion of the trial court Vartan v. Reed, 677 A.2d 357 (Pa. Commw.1996), and is reviewed only for abuse of discretion. Although Rule 2329 requires a hearing on any Petition to Intervene, see Philadelphia Facilities Management Corp. v. Biester, 487 Pa. 61, 63, 408 A.2d 1095, 1096 (1979), the hearing need not involve fact-finding or the introduction of evidence; given the clear lack of standing of Petitioners and their failure to state a valid basis for intervention, the hearing in this case should be limited, at least initially, to these threshold issues.
enforceable interest."' In Re L.J. 456 Pa. Super. 685, 691 A.2d 520 (citations omitted), appeal denied, 548 Pa. 681, 699 A.2d 735 (1997). Petitioners have no entitlement to claim any portion of the proceeds of this settlement (nor do they claim to), except to the extent that they (like anyone else) can seek to influence the way the General Assembly allocates the funds, and they (like anyone else) can apply for grants from the Foundation the Settlement creates.
Petitioners base their right to intervene on what they claim to be "legally enforceable interests," but there is no reasonable basis for that claim. Petitioners assert that they are "individuals and organizations committed to tobacco control and who work toward that end in ways which include, either actually or potentially, public interest litigation against tobacco defendants to enforce existing tobacco control measures or for compensation for tobacco-related injury to the citizenry of Pennsylvania as a whole." Amended Pet. ¶ II(a). They further assert that the Release provisions "leave them vulnerable to dismissal in any future action they might bring against tobacco defendants in furtherance of their common goals of tobacco control." Petitioners cannot explain, however, exactly what the "future action" would be.
The Pennsylvania Supreme Court has indicated that a legally enforceable interest must be at least as substantial as the interest required to confer standing. See In re Biester, 487 Pa. 438, 442 n.2, 409 A.2d 848, 850 n.2 (1979) (addressing a petition to intervene and a petition for review filed by the same nonparty and ruling that if the petitioner "lacks standing to advance the petition for review, he has no legally enforceable interest to assert as an intervenor"). The traditional test for standing is that the party must have an interest in the subject matter of the litigation that is: (1) substantial, (2) direct, and (3) immediate and not of a remote consequence. Ken R. on Behalf of C.R. v. Arthur Z., 546 Pa. 49, 53, 682 A.2d 1267, 1270 (1996). A
"substantial" interest exists only when the party has an interest in the outcome of the litigation greater than the common interest of all citizens in ensuring obedience to the laws. Id. at 54, 682 A.2d at 1270 (citing South Whitehall Township Police Service v. South Whitehall Twp., 521 Pa. 82, 86-87, 555 A.2d 793, 795 (1989)). A "direct" interest requires a showing that the matter complained of caused harm to the party's interest; an "immediate" interest involves the nature of the causal connection between the action complained of and the injury to the party challenging it. Boady v. Philadelphia Municipal Authority 699 A.2d 1358, 1361 (Pa. Commw. 1997) (taxpayer lacked standing to file complaint against municipal authority since its interest is shared by all citizens and is not immediate to confer standing).
None of the Interests that Petitioners purport to identify can meet any of these three requirements. Petitioners' interest in pursuing legal remedies to attain "tobacco control" and their general desire to promote the public interest clearly fall short of the substantial interest in the outcome of this litigation necessary to support standing. Despite their rhetoric, Petitioners have nothing more than an interest commensurate with the general public interest in ensuring that the defendants in this case conform with the law. They claim to have informed views on what the terms of the settlement should be. However, the terms of the settlement are set, and the question before this Court is not what terms could the settlement include, but rather whether this settlement that has been agreed to by the parties after many months of difficult, hard-fought arms' length negotiations, should be approved by the Court. Petitioners' opinion on the settlement terms is not enough to create a legally enforceable interest.
Petitioners hold no official position that would authorize them to act on behalf of the general public, and petitioners can be distinguished from other members of the public only by
their strong personal interest in the issue of tobacco control. Because none of the purported interests Petitioners allege will be affected by the Settlement is a legally enforceable interest, the Petition should be dismissed.
2. Even If Petitioners' Asserted Interest In The Settlement Were Legally Enforceable, Their Interest Is Already Protected By The Attorney General.
Even where a petitioner can establish that the action may affect his/her legally enforceable interest, a petition to intervene will be denied if the interest of the petitioner is already adequately represented. Pa. R.C.P. 2329(2). For example, in In re Barnes Foundation 453 Pa. Super. 436, 450, 684 A.2d 123, 129 (1996), the Superior Court dismissed a petition on behalf of students of the Barnes Foundation for lack of standing to oppose a proposed settlement partly because they could not demonstrate any harm if the settlement were affirmed. The court found that the interest of the public was already represented by the Attorney General. Id.
ln this case, Petitioners have failed to demonstrate that their interest -- that of individual citizens working for "tobacco control" -- has not been adequately protected. To the extent Petitioners' interest is in going forward with a lawsuit against tobacco companies, their interest is addressed, not just by the Attorney General's actions in bringing about this settlement, but by the very provision they challenge. Section XII provides a method by which a challenge to whatever lawsuit Petitioners bring can be addressed.
In addition, in a more general sense, Petitioners' interests are protected by the tremendous benefits of the settlement, which provides for enormously greater resources for activists such as Petitioners than ever before. This Settlement has achieved more in marketing restrictions and limitations, and more in funding for anti-smoking education and cessation programs, than this
Court or a civil jury could provide. Considering the non-economic relief obtained, the amount of the monetary relief, and the fact that this Settlement avoids years of additional delay during which many more teenagers may start smoking, the Settlement is clearly in the best interests of the Commonwealth, the citizens of Pennsylvania, and all those who have strived toward tobacco control.
C. The Petition Does Not Assert, Nor Are Petitioners Seeking, Actual Intervention
Despite the form and title that the Petition is given, Petitioners are not truly seeking to intervene in this lawsuit. If they actually had a claim against the tobacco companies that would be legally affected by this case, they would have sought leave to participate long ago. That is why there is no pleading attached to the Petition to Intervene, as required by Pa. R.C.P. 2328. That is why they cannot articulate any actual cause of action against the tobacco companies in their Petition.
What Petitioners really seek, based on the sum and substance of their allegations, is to be given a special privilege to comment on and criticize one aspect of the MSA because of their status as anti-tobacco activists. Rather than gearing up for the tremendous opportunity to further their cause that the MSA provides, their reaction to the settlement is to cry foul and seek to disrupt the process for Court approval of the settlement and securing for Pennsylvania the unprecedented provisions for achieving tobacco control. In fact, if Petitioners succeed in modifying the definitions of Releasing Parties, the only result will be to place the entire MSA in jeopardy of being terminated as to Pennsylvania. With such termination, tobacco billboards will remain upright in Pennsylvania, transit advertisements, cartoon figures sponsorships, and other forms of marketing to minors will remain, and Pennsylvania will have lost $11.26 billion that
could be used to combat tobacco and youth smoking, and fund research of tobacco-related disease, and all of the other untold public good that would derive from this settlement. The Commonwealth respectfully asks that this Court not allow that result. 16
For the reasons set forth above, the Commonwealth respectfully requests that this Court deny the Amended Petition to Intervene by Robert B. Sklaroff, MD, William T. Godshall, Jeffrey Barg, SmokeFree Pennsylvania and PennPIRG with prejudice.
D. MICHAEL FISHER, ATTORNEY GENERAL
COMMONWEALTH OF PENNSYLVANIA
Joel M. Ressler, PA ID #28621 Senior Deputy Attorney General
Louis J. Rovelli, PA ID # 19568
Executive Deputy Attorney General,
Director, Civil Law Division
Office of Attorney General, 16th Floor
Strawberry Square, Harrisburg, PA 17120
BUCHANAN INGERSOLL PROFESSIONAL CORPORATION
Thomas L. VanKirk, PA ID # 01 83
Stanley Yorsz, PA ID # 28979
Dorothy A. Davis, PA ID # 34958
Jeffrey J. Bresch, PA ID # 66777
One Oxford Centre - 20th Floor
16 As but a single example of potential additional public good, the issue has been raised preliminarily by members of the Pennsylvania Legislature that part of the unprecedented settlement proceeds be used to fund health insurance for the children of Pennsylvania whose families cannot afford that insurance.
Pittsburgh, PA 15219-1410 (412) 562-8800
DUANE, MORRIS & HECKSCHER LLP
Reeder R. Fox, PA ID # 04101
Jay J. Lambert, PA ID # 02516
Mark Lipowicz, PA ID #20716
Frank E. Noyes, II, PA ID # 48366
One Liberty Place
Philadelphia, PA 19103
Date: December 15, 1998 (215) 979-1000
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