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Tobacco Lawyers Try To Keep Memos Sealed

WASHINGTON -- Tobacco industry lawyers asked an appeals court Monday to keep a potentially damaging memo out of the federal government's ongoing racketeering trial against cigarette makers, reported the Associated Press.

Justice Department lawyers have been seeking the 1990 memo for two years, believing it could strengthen their argument that tobacco companies committed fraud by lying about the dangers of smoking and hiding that information from the public.

The memo by London-based lawyer Andrew Foyle advises an Australian subsidiary of British American Tobacco Co. plc (BAT) on whether the company should keep or destroy internal paperwork in light of increasing litigation.

William Schultz, a former Justice Department lawyer who headed the tobacco case during the Clinton administration, said the memo is key to the government's racketeering case. "I think in the context of a fraud case, evidence of intentional document destruction could be very relevant because the whole notion of fraud is that you are deceiving the public," Schultz said. "Document destruction on a systematic basis could be a central activity in the scheme of fraud."

BAT owns Brown & Williamson Tobacco Corp., which recently was acquired by R.J. Reynolds. The conglomerate is the second-largest U.S. tobacco company.

The trial is expected to last six months. The fight over the memo is proceeding as the lower court hears other evidence. The trial will continue even if the appeals judges rule the memo cannot come in.

In the lower court trial, which began last week, the government is seeking $280 billion in earnings cigarette makers allegedly earned through fraud.

Government lawyers haven't seen the sealed Foyle memo but know what it concerns because an Australian appeals court decision two years ago quoted the memo.

Bruce Sheffler, representing BAT, told the three-judge panel of the U.S. Circuit Court of Appeals for the District of Columbia that District Court Judge Gladys Kessler erred when she ordered the memo released. Sheffler said the document is irrelevant to the case against U.S. cigarette makers because it deals with a foreign market.

U.S. Circuit Court Judge David Tatel said Sheffler was describing the objection in overly broad terms compared with past arguments the company has made.

Kessler ruled in June that the company waived its right to keep the memo under wraps. She said the company's argument that it shouldn't have to produce the memo because it addresses foreign activity, rather than the U.S. cigarette market, was invalid because the memo discusses U.S. litigation.
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