TOBACCO BLUES

By ELIZABETH GLEICK

ONE NIGHT A FEW MONTHS AGO, Carl Alfarano returned to his Westchester, New York, home after work to discover that he had just missed a visit from two private detectives. They told his wife they wanted his help with a "personality sketch" of Alfarano's old friend Jeffrey Wigand. The pair claimed they had come in person only because they did not have Alfarano's telephone number--something Alfarano insists is not true. "I found it rather unnerving," says Alfarano, who worked with Wigand at two medical-device companies in the 1980s and who gave the men no information. But when he learned about the thick dossier the detectives had managed to compile about Wigand, a former vice president of Brown & Williamson and the highest-ranking tobacco executive ever to turn whistle blower, he was appalled. "It hit me like a silver bullet," says Alfarano. "[B&W] can deal with one or two defectors, but I think [they wanted] to send a signal to anybody else who's thinking about testifying."

That would explain why the team from Investigative Group Inc., a high-powered Washington detective agency, was so assiduous in its investigation that it also paid visits to Wigand's first wife and tried to track down his 22-year-old daughter from that marriage. B&W lawyers even subpoenaed Wigand's personnel record from the Louisville, Kentucky, school system, where Wigand now teaches science and Japanese. The investigators may have thought they would turn Wigand's fellow educators against him. They were wrong. "Not all of us agree with what [Wigand] is doing," says Barbara Fendley, who supervises Wigand at DuPont Manual High School and is married to a tobacco farmer. "But we all support his right to do what he thinks is right. We're bigger than Brown & Williamson."

To date, however, no one has ever bested the nearly $50 billion-a-year tobacco industry, which historically has been willing to spend whatever it takes to neutralize its enemies. In all the years of litigation against cigarette makers, they have yet to pay out even a nickel in damages.

But Wigand, with his allegations that B&W manipulated nicotine levels in cigarettes, knowingly used a carcinogenic additive to make pipe tobacco taste better and covered up research into "safer" cigarettes, has begun talking to lawyers, grand juries and the media at an inopportune moment for tobacco. The Food and Drug Administration has proposed to regulate nicotine as a drug in cigarettes; teen smoking rates have taken an alarming jump; and five grand juries are looking into possible perjury and malfeasance by industry executives. At the same time, a novel legal strategy, which would hold the tobacco industry responsible to taxpayers rather than individual smokers, is gaining momentum around the country. "The current round of attacks on the tobacco industry is better thought out, better funded and better organized than at any time in history," says Matthew Myers, a Washington lawyer who has spent 14 years litigating cases on behalf of the Coalition on Smoking OR Health. "And it comes at a time when the tobacco industry is more vulnerable than ever, given the disclosures from inside the industry."

So far, no B&W colleagues have jumped the wall to support Wigand; in fact, none have even contacted him to offer words of encouragement. That is understandable: Wigand, who says he received two telephoned death threats after he began cooperating with investigators, has been reduced to traveling with a security guard, and another guard watches over his two young daughters. His corporate career in the biomedical field, which until he worked at B&W had been on a steady upward trajectory ("I wanted to be CEO of a company," he confesses), has foundered. His marriage hit the rocks owing, he says, to the stress of battling his former employer. Nevertheless, Wigand, 53, tells Time that now that he has begun to talk, he has no plans to stop. Though he has been tied up in suits filed by his former employers since he left the company in 1993, he is countersuing, claiming B&W invaded his privacy, made false statements about his personal life, destroyed evidence and abused the legal process in an effort to intimidate him. He is also weighing a libel action against B&W, IGI and Manhattan publicist John Scanlon for waging what he regards as a smear campaign. "I believe the industry as a whole is flagrantly deceptive and dishonest," he explains. "It says one thing and does another, and I think the public needs to know that."

His allies believe Wigand is just the man to bring a jury into tobacco's inner sanctum. "Wigand can personalize the story and give...firsthand evidence...as to how the industry was conducting its business and what its motivations were," says Scott Ballin of the Coalition on Smoking OR Health, which includes the American Cancer Society, the American Lung Association and the American Heart Association. "The efforts that they are going through to discredit him are directly proportional to the damage they know his testimony can do," says Richard Scruggs, the Mississippi lawyer who is shepherding Wigand through the courts.

Even if Wigand were mysteriously to vanish tomorrow, however, antismoking advocates are convinced the deck is at last stacked in their favor. Through earlier litigation and the efforts of other whistle blowers, 30 years of internal documents have been exhumed that appear more damning than any single witness. They confirm, for instance, that, as one Philip Morris executive put it in the early 1970s, "smoke is beyond question the most optimized vehicle of nicotine and the cigarette the most optimized dispenser of smoke," and that as early as 1963 B&W executives knew nicotine was addictive. "Of course it's addictive," F. Ross Johnson, former CEO of RJR Nabisco, told the Wall Street Journal two years ago. "That's why you smoke."

Many tobacco executives swore otherwise when testifying before Representative Henry Waxman's health subcommittee in 1994, but consistency has never been central to the industry's legal defense--overwhelming force has. As RJ Reynolds lawyer J. Michael Jordan put it in a 1988 memorandum, "To paraphrase General Patton, the way we won those cases was not by spending all of Reynolds' money but by making that other son of a bitch spend all his." Liggett Group, for instance, spent an estimated $75 million fighting the Cipollone case in New Jersey; though the jury awarded the husband of Rose Cipollone, who died of lung cancer, $400,000 in damages, that verdict was overturned on appeal. Tobacco experts insist they are undaunted by the slew of new lawsuits, and they point out that Jeffrey Wigand has yet to be cross-examined. In fact, five law firms are representing B&W in its breach-of-contract lawsuit against Wigand, who notes dryly, "I'm just a little schoolteacher, and they are how many? Pretty even odds, I think."

Now, however, the anti-tobacco forces are taking a page from the cigarette makers' own playbook. "This king-of-the-mountain game they've played is a game that would be played by a schoolyard bully," says Northeastern University law professor Richard Daynard, chair of the Tobacco Products Liability Project, which conducts research for anti-tobacco lawsuits. "After you've beaten a couple of kids up, nobody dares take you on. But the moment the kids say, 'We can take him if we band together,' the bully is finished." It helps too that the new legal strategy of states filing third-party claims against the tobacco companies to recoup the Medicaid dollars spent treating smoking-related illness involves possible monetary settlements--and legal fees--so huge that anti-tobacco litigation is now attracting the top guns of tort law. To date, five states--Florida, Minnesota, Mississippi, West Virginia and Massachusetts--have filed such suits. Maryland plans to join the fray soon, and Texas may follow. In most states, prestigious private firms have agreed to bear all costs of litigation, hoping to recoup those, and much more, from their percentage of projected billion-dollar judgments.

For big tobacco, which has traditionally deployed veritable armies of attorneys from such white-shoe firms as King & Spalding in Atlanta, Covington & Burling in Washington and the Kansas City firm of Shook, Hardy & Bacon, this new assault amounts to a dangerous game of dominoes. "The moment they lose one the other states are going to have to file," says Daynard. "Imagine being the attorney general of a state and saying while my neighboring attorney general is getting $400 million in restitution for the taxpayers of his state, I am not going to file as a matter of principle. At that point, you'd very quickly get a lot more cases filed than the industry can pay for." And the states that have filed so far are sharing documents, witnesses and strategies. Maryland attorney general J. Joseph Curran Jr., for example, says he has met with officials from 33 states who want information about launching similar suits.

In Mississippi, attorney general Mike Moore and attorney Scruggs are leading the charge with a legal theory, never before deployed in anti-tobacco suits, called "unjust enrichment." Rather than suing on behalf of specific sick individuals, a strategy that has yet to succeed, the states are claiming they are tobacco's hit-and-run victims, stuck paying out billions of taxpayer dollars each year to treat the array of health problems wrought by smoking. In other words, says one frustrated tobacco-industry lawyer, "the states are taking the position that they don't have to prove anything except the company sold the cigarettes." This denies tobacco's advocates all their favorite defenses--that the individual's health problems may have been caused by workplace or environmental toxins, or by personal habits such as lack of exercise and a high-fat diet, and that in any case, he or she made the choice to smoke. Says Dan Donahue, senior vice president and deputy general counsel for RJ Reynolds Tobacco: "It's brand-new law. There have nowhere, never, ever, been the same kinds of claims made as they're making."

That would explain the vehemence with which tobacco is fighting back--in some cases pre-emptively. Industry lawyers have already filed suits trying to block the possible Maryland and Texas cases. In West Virginia, Governor W. Gaston Caperton, with the support of several of his own judicial appointees, has for now effectively scuttled that action by suing his own attorney general, Darrell McGraw, on the grounds that he did not have the authority to file a Medicaid suit. A few weeks ago, Mississippi Governor Kirk Fordice, following Caperton's example, filed a similar suit against attorney general Moore. Fordice, though elected with the help of tobacco contributions, claims he is no special friend to the cigarette makers, but is merely concerned that industry will be driven from Mississippi if corporations are held liable for every illness their products cause. "When pepperoni kills 425,000 people a year, we'll go after the pepperoni business," snaps Moore, who won his third term with the backing of friendly plaintiffs' lawyers. "Do you know what the 'AG' in attorney general stands for?" RJR's Donahue asks. "Aspiring Governor."

The tobacco wars may be hottest in Florida right now. In the last five minutes of the last day of the 1994 session, the state legislature overwhelmingly--and according to some, unwittingly--passed Senate Bill 2110, a Medicaid amendment that holds the tobacco industry responsible for the estimated $300 million to $800 million a year the state pays to treat tobacco-related illnesses and that allows lawsuits to collect these funds to use statistical evidence compiled by the Centers for Disease Control. "Profound sneak attack," charges one tobacco lobbyist. The tobacco industry and some associated industries, like U.S. Sugar, filed suit to repeal the bill; the Florida Supreme Court is expected to rule soon. Although last year Governor Lawton Chiles vetoed the legislature's repeal of the legislation, the lawmakers are expected to override that veto next month. Many have been swayed by lobbyists' arguments that if the state can sue the tobacco industry no one is safe, and the liquor industry and manufacturers of high-fat foods had better start worrying. "There is, after all, such a thing as equal protection," notes Donahue, "even for the tobacco industry." But Chiles, vehemently anti-tobacco, has proclaimed his determination to make hash of his political enemies and refile the suit if necessary. "The Governor has made it very clear [that] if you expect access to this office to get the great favors, you're with him in this issue," says his general counsel, Dexter Douglas. "We've adopted fixed bayonets, and when that order comes, that's it. It's them or you. You start using the knives when the bullets run out."

As tobacco champions twist their minds around possible defenses to the suits, they appear to be falling all over themselves in a vaudeville of contradictions. On the one hand, they argue, disease cannot be definitively linked to smoking; on the other, they have suddenly begun to point out that of course cigarettes are bad for us. "How can anybody, in good faith, take the position that the risks of the use of this product are not well known to everyone?" demands Donahue. "When you come to the bottom line, what does the consuming public know? They know everything." As Philip Morris attorney Mike York puts it, "You'd have to be living under a rock to not know there are risks associated with smoking."

The lawyers are less quick with a response, however, when asked about what Florida assistant attorney general Jim Peters refers to as "the big bad bear out there": the federal perjury probe launched after seven tobacco CEOs testifying at the Waxman hearings swore that nicotine was not addictive. Philip Morris lawyers point out that their former CEO, William Campbell, did not say tobacco is not addictive: he only said he doesn't believe it is addictive, a "personal viewpoint he has every right to hold," says York. Some tobacco experts speculate that the tobacco industry may seek a deal in which cigarette companies agree to some level of FDA regulation in return for corporate and personal immunity from any charges of wrongdoing.

For looming over the industry is yet another threat, this one from Washington, where FDA chief David Kessler is considering a series of regulations on tobacco advertising and tobacco's availability to teenagers. The FDA proposal, which would ban cigarette-vending machines, free samples, mail-order sales, and outdoor advertising within 1,000 feet of schools, depends on an agency determination that cigarettes are a "drug-device combination product." But such a move would provoke cries of anguish from tobacco allies, who claim that Kessler, with the support of President Clinton, is actually seeking an all-out ban. "I believe nothing less than complete prohibition is good enough for the regulators over at the FDA and the anti-tobacco zealots," said Kentucky's Democratic Senator Wendell Ford last fall. Kessler insists this is not the case--that the FDA has no interest in provoking the kind of social disruption that would result from weaning 40 million smokers from nicotine.

Even if the teen smoking regulations were to go into effect, most would merely shore up existing, if unenforced, laws. And just as smoking wafts in and out of vogue, reports of tobacco's demise may be greatly exaggerated. David Adelman, a tobacco-industry analyst for Dean Witter Reynolds, points out that the industry has a remarkable ability to shift gears. "Ninety-five different things have come out in the past, and you have the anti-tobacco people saying this is it, this is going to be the case that brings victory," he says. "But it's a pretty high hurdle." As Congressman Waxman concedes, "Tobacco companies are the strongest special-interest group in Washington."

Meanwhile, Jeffrey Wigand, a devotee of things Zen since a stint in Japan as an Air Force medical technician, sits remarkably calmly in the eye of a storm he helped create, maintaining what may be the most realistic vision of how far the tobacco wars can ultimately go. "I'm not an antismoking activist," he insists. "I think people are going to continue smoking, no matter what." And that inescapable fact, in the end, may be the best weapon Big Tobacco has.

--Reported by Hannah Bloch/Washington, Elisabeth Kauffman/Nashville, Elaine Rivera/New York and Elaine Shannon/Louisville

With reporting by HANNAH BLOCH/WASHINGTON, ELISABETH KAUFFMAN/NASHVILLE, ELAINE RIVERA/NEW YORK AND ELAINE SHANNON/LOUISVILLE