Federal Appeals Court Rejects Government's Bid for Full Court Hearing on Disgorgement as Remedy in Government Suit against Tobacco Companies and Other Defendants

A federal appeals court today denied the Department of Justice’s request to reconsider its February 2005 opinion holding that disgorgement of past revenues and profits is not an available remedy in the federal government’s civil RICO case against Philip Morris USA, the other major tobacco companies and other defendants.

The U.S. District Court of Appeals for the District of Columbia rejected, without comment, a request by the government for a full-court review of the earlier decision by a three-judge panel rejecting disgorgement as a remedy in the case.

"The specific civil RICO provision that the government has invoked in this lawsuit does not allow for an award of disgorgement," said William S. Ohlemeyer, Altria Group, Inc. vice president and associate general counsel. Altria and its tobacco company subsidiary, Philip Morris USA, are among the defendants.

Ohlemeyer also noted that for the government to obtain any other remedy under the civil RICO statute, it must prove that the defendants have engaged in fraudulent behavior in the past and that they are likely to do so in the future.

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