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In recent years, state attorneys general (AGs)have begun to act more and more like plaintiffs’lawyers who aggressively assert novel claims inlitigation. That trend was most dramaticallyillustrated by the AGs’ lawsuits against the tobac-co industry in the 1990s. By filing those suits,which lacked any support in prior law, the AGsinvaded areas of regulatory and tax policy thatare properly the responsibility of state legisla-tures. Although the AGs probably did not expectto prevail in court, they filed with the aim of forc-ing the defendants to settle—which they did. Theprimary effects of the settlement have been high-er prices for cigarettes and the transfer of enor-mous sums of money, raised through the higherprices, to state governments and the privateattorneys they hired. Perversely, the settlementalso protected the market shares and profit mar-gins of the major tobacco companies and furtherconfounded the public as to the proper role of government in American life.Unfortunately, the AGs’ “success” in thetobacco cases has inspired state and local gov-ernments to file similar lawsuits against firearmsmanufacturers, lead paint manufacturers, andhealth maintenance organizations. While thosesuits have not yet resulted in any significant vic-tories for the plaintiff governments, much of thelitigation is still pending. More important, wecan expect to see more “son-of-tobacco” govern-ment lawsuits. The states have an enormousincentive to bring such big, flashy lawsuitsagainst unpopular industries.This paper argues that the AGs’ new litigationstrategy amounts to a form of “government law-suit abuse” that not only breaches the separationof powers in state government but saddles thepublic with additional tax and regulatory bur-dens that are both unwanted and unwise.The paper also sketches several legal reformsthat would redefine the office of state attorneygeneral, returning it to the important (but muchless headline-grabbing) work that occupied theholders of that office until very recently.
 Restraining State Attorneys General,Curbing Government Lawsuit Abuse
by Michael DeBow
_____________________________________________________________________________________________________
 Michael DeBow is a professor of law at the Cumberland School of Law, Samford University, and is special assistant  for legal policy, Office of the Attorney General, State of Alabama. The views expressed here are solely the author’sand do not necessarily reflect the views of any institution with which he is affiliated. An earlier version of this paper was published in
Seton Hall Law Review
31, no. 3 (2001).
Executive Summary
No. 437May 10, 2002
 
Introduction
Some aspects of the American legal sys-tem are now so absurd that they are beyondparody. If that assessment sounds tooextreme, consider this: On Sunday, January20, 2002, the Fox Network’s animated pro-gram
The Simpsons
featured an episode inwhich Marge Simpson filed a class-actionsuit against the sugar industry (referred to as“Big Sugar”) on behalf of the obese citizens of Springfield, her family’s hometown.On the following Tuesday, the ABC Newswebsite posted a story titled, “You’re Fat, WhoCan You Sue?” In it, “nutrition activists” andtheir academic fellow travelers complainabout a wide range of things, including theamount of money spent by the food industryon advertising. (“‘It’s not fair,’ [one activist]said. ‘People are confronted with food in everypossible way to eat more. The function of thefood industry is to get people to eat more, notless.’”) The story notes, “Some say the foodindustry—particularly fast food, vendingmachine and processed food companies—should be held accountable for playing a rolein the declining health of the nation.” But, of course, “Most public health experts . . . aremindful that after years of going after BigTobacco, anti-smoking forces only achievedsuccess when plaintiffs and lawyers steppedin.” The hope is expressed that while to dateno such litigation has been commenced, “it isreasonable to think that someday, it maycome to that.”
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How on earth did it come to this—that“serious” discussions of the future of American law are as outlandish as the plot of a satirical cartoon program? How can weaccount for the widely held view that virtual-ly any social concern should ultimately betreated as a legal issue and decided in a courtof law?State attorneys general (AGs) bear a greatdeal of responsibility for our present predica-ment, particularly because of their conductof the states’ litigation crusade against thetobacco industry from 1994 to 1998. TheAGs’ tobacco litigation was an unprecedent-ed affront to the rule of law and will havedeleterious effects on the American legal sys-tem for years to come unless it is counteredby new restrictions on the powers of stateattorneys general that take away their abilityto commit “government lawsuit abuse.”This paper first describes the state tobac-co litigation in some detail, then briefly sur-veys the lawsuits brought by state and localgovernments against other industries in thewake of the tobacco suits. It then fleshes outthe concept of “government lawsuit abuse.”Next, the paper turns to the state attorneygeneral’s office—its history and constitution-al status. The AG’s “common law” andparens patriae
2
powers are described andplaced in historical context. The bottom lineis that those two powers have assumed theimportance they have today only in the last20 years or so. Accordingly, there is amplehistorical precedent to trim those powers torestore some semblance of constitutionalorder to the office of state attorney general.The final section of the paper discusses leg-islative and constitutional reforms that canand should be considered as correctives tothe recent lawsuit abuse practiced by stateattorneys general.
Overview of the StateTobacco Litigation
The case for new constraints on state AGsbegins with an understanding of the lawsuitsthe AGs filed against the tobacco industry.
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The suits were nothing if not inventive.Individual smokers had tried for years,unsuccessfully, to sue the tobacco industryfor smoking-related health problems. Thestates’ lawsuits attempted to avoid the fate of the smokers’ suits by seeking not to vindicatethe rights of smokers but to recoup state gov-ernment expenditures on Medicaid andother health programs that could be statisti-cally linked to smoking-related illnesses.Each state’s complaint alleged a numberof causes of action—some statutory, some
2
The AGs’ tobaccolitigation was anunprecedentedaffront to the ruleof law.
 
based on common law. In each count, thestate attempted to shoehorn its Medicaidrecoupment theory into a pre-existing legalcategory, such as subrogation, unjust enrich-ment, indemnity, fraud, product liability,breach of warranty, public nuisance,antitrust, or deceptive trade practices.However—
and this point is critical
—none of those causes of action, as defined at the timethe cases were filed, would justify the state’sclaim for recoupment from the tobacco com-panies.
4
Accordingly, the plaintiff state AGsargued that the pre-existing definition of acause of action be dramatically expanded bythe courts to encompass, for the first time,the state’s alleged right to recoup health caremonies from the defendants.The fact that the legal theories advanced inthe litigation by the state AGs were withoutprecedent in American law raises an extremelyimportant question: Is it properly the job of astate attorney general to file suits withoutsolid precedential support in order to extractsettlements that promote regulatory and/ortax policies that the state AG desires?For reasons that are clearly illustrated bythe settlement of the state tobacco litigation,the answer to that question is “No.”The settlement of the tobacco litigation, inNovember 1998, was a legal and public policydebacle of truly historic proportions.
5
Thetobacco companies agreed to abide by a newset of regulatory constraints and to makemultibillion-dollar payments annually to thestates (and the trial lawyers from private prac-tice who were hired to represent most of them)in perpetuity. Although the amounts paid outmay vary because of inflation and changes inthe percentage of the population who smoke,the total payout to the states during the first25 years covered by the settlements(1998–2023) will be approximately a quarterof a
trillion
dollars. Although the amount of payments to the lawyers during this same peri-od is more difficult to predict, a total of $13.75
billion
seems a good ballpark estimate.
6
Thetobacco settlements will thus lead to thelargest transfer of wealth resulting from litiga-tion in the history of the human race!The settlement has generated several sig-nificant perverse consequences. First, theenormous payments to the state govern-ments and their private-sector attorneys arebeing, and will continue to be, financedalmost entirely by smokers paying new, high-er prices announced by the defendant firmsimmediately after the settlement wasannounced. Thus, the putative “victims” of the tobacco companies are, in effect, payingthe lion’s share of the settlement amountsthat the states are collecting.Second, the tobacco companies negotiat-ed several features of the settlement that willprotect their profits and market shares fromnew entrants.
7
The settlement effectively actsas a cartel agreement for the firms currentlyin the tobacco industry.Third, the size of the payments is depen-dent on the future profits of the tobaccocompanies, thus making the state govern-ments de facto silent partners in the opera-tions of the companies that the states so vig-orously demonized during the litigation.Fourth, the only clear winners in this sadtale are those few plaintiffs’ lawyers who werefortunate enough to be tapped by one ormore of the state AGs to represent one ormore states in this raid on the tobacco indus-try. They are now reaping historicallyunprecedented fees—and will continue to doso in perpetuity—under contracts that raisevery serious ethical questions.
8
To put it mildly, the righteously indignantstate crusade against the tobacco industrygenerated more than its share of irony.Furthermore, in its practical effects, theresult of the settlement is indistinguishablefrom an increase in the excise tax on tobacco.Viewed constitutionally, the settlement isnothing short of a disaster. It results in hugechanges in state regulatory and fiscal policytoward tobacco without any direct involve-ment of the political branches—the state leg-islatures and the governors. What was oncesettled in the free-for-all of the political arenais now committed to the care of the stateAGs, their high-rolling trial lawyer allies, and judges. This situation further confuses the
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The settlement isnothing short of a disaster. Itresults in hugechanges in stateregulatory andfiscal policytoward tobaccowithout anydirect involve-ment of the polit-ical branches.
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