RJR Nabisco scotches settlement rumours
Saturday 23 March 1996
While Philip Morris published full-page newspaper advertisements refuting claims that it manipulates nicotine levels in its cigarettes, its rival RJR Nabisco moved yesterday to play down suggestions that it might seek a global liability settlement to protect itself against future consumer lawsuits.
RJR Nabisco was reacting to remarks attributed to its chief executive officer, Steven Goldstone, published in yesterday's Financial Times, hinting that the company would consider some kind of general settlement and payment of compensation in return for immunity from any future lawsuits. In a statement, RJR Nabisco insisted that it remains determined to contest the legion of lawsuits now pending in the US against the industry. The company, it said, "has no intention of settling any of the litigation in which it is currently involved because it is confident it will those cases".
The cigarette makers were stunned when their ranks were broken last week by Bennett LeBow, owner of the Liggett Group, when he reached out-of-court settlements with two big groups suing the industry. In an interview with the Financial Times, Mr Goldstone said that the question was open, "whether there can be a way on an all-embracing basis to solve the problem once and for all. I don't know of a way, but I do know that it isn't the kind of thing that the tobacco industry would try to obstruct, because we know that litigation is not good for our companies".
In its advertising blitz, Philip Morris, meanwhile, was responding to the allegations of three of its former scientists made public on Monday by the Food and Drug Administration, in which they contended that the company had systematically regulated the levels of nicotine in their cigarette products. The company, which makes the Marlboro brand, plastered newspaper pages with the headline: "What does Philip Morris have to say about the allegation of `nicotine manipulation'? Plenty."
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