Newspaper article St Louis Post-Dispatch (MO)

Tobacco Foes Gleeful at Liggett Admission but Revelation Fails to Rattle Analysts; Case Called Symbolic

Newspaper article St Louis Post-Dispatch (MO)

Tobacco Foes Gleeful at Liggett Admission but Revelation Fails to Rattle Analysts; Case Called Symbolic

Article excerpt

Tobacco opponents reacted gleefully Thursday to the Liggett Group's admission that cigarettes cause cancer, but Wall Street analysts shrugged off the news.

The manufacturer's confession gave a new legal weapon to smokers who sue cigarette makers. How powerful it is remains in doubt.

"I think their credibility is shot before the first witness is called now," said Richard Daynard, who heads the Tobacco Products Liability Project at Northeastern University in Boston. Investors showed their concern, selling off shares of the four other tobacco companies that continue to maintain that there is no direct link between smoking and health. But tobacco industry analysts, who often are skeptical of challenges to the powerful industry, said the admissions were more symbolic than significant because Liggett is a small, weak company and the others are resolved to scrap with their enemies in court indefinitely. Jack Maxwell, tobacco industry analyst with Wheat First Butcher Singer, a securities firm in Richmond, Va., said: "This is a media event and has no relation to the rest of the industry. I've been telling my clients today it's a damned good buying opportunity for the tobacco group." Liggett Group will make its admission in a settlement of health la wsuits by 22 states. The states said Thursday that Liggett also plans to admit that cigarettes are addictive and that companies market them specifically to children. In addition, Liggett has agreed to allow its employees to testify for plaintiffs in remaining lawsuits by individual smokers - of which there are hundreds. Liggett also promised to release 30 years' worth of documents describing private conversations among cigarette industry lawyers, the states said. `Mom-and-Pop Company' John Banzhaf of Action for Smoking and Health said Liggett's admissions would make a big impression on juries. …

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