History shows why investing in congressional candidates can maintain a favorable legal environment for future high-return litigation. Lawyers received billions of dollars in contingency fees from the tobacco settlement in November 1998, in which manufacturers were held liable for the deliberate actions of consumers. In Texas alone, attorneys were awarded $2.3 billion. One report noted:
Private attorneys in Texas, Mississippi and Florida made out like bandits, fleecing tobacco companies, smokers and taxpayers for $8.2 billion in legal fees – billions more than the lawyers themselves had demanded!
After the tobacco settlement, the law lobby more than tripled the amount of total political contributions to federal candidates, from $59 million in the 1998 election cycle to $183 million in 2004. Considering that the Bipartisan Campaign Finance Reform Act banned “soft money” contributions by the 2004 elections, the $183 million is compelling.
But what happened with the settlement money, and who paid for it, provides another relevant part of the story.
The settlement supposedly funded government health programs. For example, in 2002-3, nearly $1 billion of the Texas settlement went to health and human services, including education and enforcement programs requiring more bureaucrats, buildings, and maintenance, and even debt service on capital improvement bonds for one hospital. Another $90 million went for higher education programs like nursing.
But in California, state legislators grabbed the first $562 million installment for the settlement payment, placing it in the general fund and thwarting those wanting to direct the money to public health programs. In fairness, some probably ended up in public health programs.
But the settlement money was paid to government.
The financial damages were not exactly punitive to the tobacco companies. Tobacco companies are often part of conglomerates, allowing them to raise prices on products unrelated to smoking in order to pay settlement costs. For example, Phillip Morris, one of the tobacco companies involved in the settlement, is owned by Altria Group, which owned Kraft Foods until 2007.
When expenses increase, companies raise prices. Anybody buying Kraft products between 1998 and 2007 was also paying the tobacco settlement.
When your money goes to government agencies, it’s a tax, proving the fantasy of “business” taxes and fines, and making the tobacco settlement taxation without representation. Working with predominantly Democratic lawmakers, lawyers transfer your wealth to themselves and government, while cigarette manufacturers continue business as usual.
In an indirect manner, firearms tort litigation presented a golden opportunity for bigger paydays. Gun makers don’t have deep pockets. During the PLCAA hearings, Lawrence G. Keane of the National Shooting Sports Foundation testified: “The firearm industry taken together would not equal a Fortune 500 company.”
Creating case law precedent, holding product manufacturers liable for the criminal use of their products, opens up major financial doors. Do gang bangers wear Nike clothing to identify themselves? Sue Nike, ranked 124th in 2010’s Fortune 500. Bank robbers prefer Mustangs for getaway cars? Sue Ford, ranked 8th.
After all, these manufacturers knew their products were ending up in criminal hands. They should have been responsible corporate citizens and reduced production so that “surplus” wouldn’t be available for criminal use. If nothing else, sue them for helping create a public nuisance by enhancing criminal activity.
Perhaps firearms manufacturers’ inability to afford ongoing defense against tort cases made them an easy opportunity to get that case law on the books?
Since the law lobby is so powerful, it’s reasonable to conclude they want to eliminate any threat to their goals, including your guns. They know that destroying the firearms industry won’t directly provide a tobacco-like payday, but it shifts the balance of power further away from the people.
Brady and the Violence Policy Center are the spear tip of the anti-rights movement. Educate and empower yourself, and vote.
* For more details and citations on many related issues, see Four Hundred Years of Gun Control, Chapter 4.