presented by Philip Karugaba
Mugerwa & Masembe Advocates
Uganda

World Conference on Tobacco or Health
Chicago, Illinois – USA

August 6-11 2000

Tobacco litigation is as contagious as tobacco is addictive. The reason for this are found firstly in very nature of the smoking epidemic, that cuts across all borders and all divides. It afflicts and affects us all, poor and rich countries alike. The second reason is to be found in the basic commonality of our legal systems providing for redress to persons wronged and also probably more so in the nature of that much reviled creature-"the lawyer".

Uganda, this year saw two suits, the first of their kind, being filed for personal injury claims by victims of smoking. This paper examines the relevance of U.S. litigation experience to Uganda. We highlight Uganda’s socio-economic and legal circumstances as the context for the discussion. We then briefly review the U.S tobacco litigation history before examining its relevance and application to Uganda.

Uganda’s GDP growth rate is above average for developing countries, and now stands at 5.1% with a GDP per capital of US.$ 170 with a population of 23 million.

Tobacco was introduced into Uganda in the early 1920’s, and today is a major source of revenue for 11 districts (Arua, Gulu, Apac, Kitgum, Lira, Hoima, Masindi, Kiboga, Kibaale, Mubende and Rukungiri). In Arua District tobacco accounts for 70% of the revenue from agriculture. This year, Arua District alone is expected to produce 24,000 tonnes of flue cured Virginia tobacco leaf. Nationally tobacco has grown to become the second largest cash crop far outstripping the traditional cotton and tea. Production is to be increased to meet the expected shortfall on the world markets following the land issues in Zimbabwe. It is estimated that 600,000 people depend on tobacco for their livelihood directly or indirectly.

British American Tobacco Uganda Limited ("BAT Uganda") is the main player; with 92.9% of the 1,703.7 billion sticks per annum market. From its first export of 740 kilos in 1927, the company now exports 19.7 million kilos per annum. In 1999, BAT produced 21,640 tonnes of tobacco. Local consumption accounted for 1,610 tonnes while the rest was exported to Austria, Egypt, France, Germany, Hungary, Holland, UK and Japan. Over the last 4 years, BAT Uganda has invested US. $ 16.2m in plant & machinery. The plant capacity in Kampala now stands at more than 25,000 tonnes per season. Other players in the market are Mastermind Tobacco Uganda Limited and Phillip Morris International.

BAT Uganda is the fourth largest taxpayer in Uganda after the oil companies. It contributed approximately 7% of the tax collected in 1998 and in 1999 its tax payments were approximately Ug. Shs. 50 billion.

On 28^th June 2000 as part of the privatisation process, BAT Uganda put on offer 4,907,984 shares (approximately 10%) at an offer price of Uganda Shillings 1,000 per share (about US cents 65). Among the risk factors listed in the prospectus are legislative action (adverse anti-tobacco legislation) and litigation. The prospectus mentions significantly a product liability case which the Plaintiff values at US $ 10 million. BAT claims that it is actively lobbying Parliament to incorporate the BAT voluntary code of practice covering advertising, marketing and promotional activities in legislation that they may consider passing on tobacco. In road shows to promote the share sale, participants have asked questions about health concerns and the recent damages awards against tobacco companies in the United States Courts.

According to a study carried out in 1995 in four districts (Mbarara, Hoima, Kumi and Kampala) 20.9% of the 1309 persons interviewed were current smokers and 19.6% were ex-smokers. 52% of the male respondents were either current or ex-smokers compared to 17.6% of the female respondents. The commonest form of tobacco consumption was found to be cigarette smoking, with current smokers consuming up to 29 cigarettes per week.

No econometric studies have been carried out to determine the health costs of tobacco in Uganda and figures from other countries do not translate well into our context. There is also a problem in the diagnosis of tobacco related diseases.

While the tobacco economy in Uganda makes impressive reading in terms of revenue to the Government and jobs created, the health costs of tobacco are simply not that visible. The more apparent problems of AIDS, malaria and malnutrition still dominate our health agenda.

Our legal system follows the English Common Law tradition. We have a written constitution with a bill of rights, which significantly includes a right to life, a right to clean and health environment and a very liberal position on locus standi for the enforcement of fundamental human rights. We also have an environmental framework law echoing the constitutional environmental rights and expanding locus standi. The environmental framework law also provides for the application of the precautionary principle.

The Tobacco (Control and Marketing) Act No. 25 of 1966 governs the control of production and marketing of leaf tobacco and matters incidental thereto. It contains provisions for the declaration of growing areas, markets, buying seasons and prescribes a licence for the purchase of leaf tobacco. The Act has no provision for consumer protection and non-smokers rights.

We are under a movement system of democracy and our enlightened leadership has gone to great lengths to demonstrate this as a unique Ugandan phenomenon, distinct from one party rule and free of the ills of multi-party democracy. We have had for the last 14 years a very pro-investment strongman as President, Yoweri Kaguta Museveni. His stand on tobacco came to light in March this year at the commissioning of a new US. $ 4.5m leaf threshing plant by British American Tobacco Uganda Limited. His Excellency defended cigarette makers and blamed Ugandans for copying European habits badly. He stated that the problem was not with cigarette but "how people smoke". He stated further;

Citing a kinyankore proverb he said further;

More recently the 2^nd Deputy Prime Minister and Minister of Tourism, Trade and Industry while showing around delegates from the BAT China stated

On the brighter side, on World No-Tobacco Day this year, the State Minister for Health Dr. Phillip Byaruhanga declared the Ministry of Health premises a no-smoking zone. The Uganda Taxi Operators and Drivers Association (UTODA) and bus operators maintained their ban on smoking in passenger vehicles.

While there is an apparent ban on tobacco advertising on state media (television and radio) declared on World No Tobacco Day 1995, there are no restrictions on advertising in the state owned newspaper, private newspapers, private television stations and the popular private FM radio stations. BAT Uganda sponsors a late night programme on Capital Radio called Late Date (Pillow Talk) to promote its upmarket brand Embassy. Until recently there was a large billboard promoting the same brand right outside Mulago Hospital, the national referral and teaching hospital.

BAT Uganda recently relinquished the main sponsorship of an annual sportsmans gala held by the Uganda Sports Press Association to crown the best sports personalities of the year. The sponsorship was dropped after pressure by anti-tobacco activists. However BAT Uganda still sponsors a football league, Kakungulu Sportsman’s Cup.

Cigarettes manufactured in Uganda carry a health caution "Smoking can be harmful to your health" which is attributed to the Ministry of Health. The caution is carried on the side of the packet and is mentioned at the end of every radio and television advertisement of a tobacco product.

With half a century of tobacco litigation the U.S. has the longest history of tobacco litigation. It is significant that for more than four decades, the tobacco industry was able to successfully defend all claims brought against it.

The litigation history can be categorised into distinct waves. The first wave began in 1954 and typically used one or both of two legal theories; negligence and implied warranty, none of which found favour with courts. The second wave began in 1983 and ended in 1992. The legal theory applied was one of strict liability. For the tobacco industry, it was pleaded successfully in their defence that smokers were aware of the risks of smoking and that they made a free choice. In the ongoing third wave of litigation, the plaintiffs were enlarged, as were the legal issues. The new claims were based on intentional misrepresentation, concealment and failure to disclose. The class action device by which suits were filed on behalf of several plaintiffs was also employed.

The years of litigation have borne fruit. In November 1998, the Master Settlement Agreement was announced. This was a settlement of suits brought by Attorney Generals of several states to recover the health care costs of treating tobacco related diseases. In the Settlement Agreement, the tobacco companies undertook to pay US. $ 206 billion over the next 25 years. Early this year Florida jury announced a US.$ 145 billion punitive damages award in the Engle class action suit. In February 1999 Patricia Henley a 52 year old ex-smoker with lung cancer was awarded US.$ 50 million in punitive damages against Phillip Morris. In March 1999 an Oregon jury ordered Phillip Morris to pay US.$ 81 million to the family of Jesse Williams who had smoked Marlboro cigarettes for 40 years before he died. On 21^st March a California jury ruled that Phillip Morris and RJ Reynolds pay US.$ 21.7 million in damages to lung cancer victim Leslie Whiteley and her husband.

With the unique skills and abilities of American trial lawyers we are sure to see lots more suits against big tobacco. What does this experience mean to us in Uganda and how can we use it.

It is undeniable that America exercises a great influence over Uganda in many ways. In the early 1990’s Uganda produced an anti-tobacco stamp. It featured tow great American characters from Disneyland; Mickey Mouse and Donald Duck.

In the legal realm, the differing culture, legal traditions and regulatory framework allow for little precedential value of decisions made by American courts in Uganda. Having said that however an examination of the two suits for personal injury claims by tobacco victims pending in the High Court of Uganda show undeniable American influence. In THOMAS OKUMU –VS- BAT UGANDA & ANOTHER H.C.C.S NO. 465 of 2000, the Plaintiff filed suit for the following;

1. all nicotine dependant persons (addicts) to cigarette smoking in Uganda who have purchased and smoked cigarettes manufactured by the 1^st and or 2^nd Defendant;
2. the estates, representatives, next of friend, next of this and administrators of the above current, former and future nicotine dependants (addicts)
3. heirs and survivors of nicotine dependants
4. all cigarette smokers

The action is based on product liability and negligence. The Plaintiff prays inter alia that the court orders the Defendants to contribute 1% of the annual profits to a Tobacco Medical Monitoring Fund, and for the regulation of tobacco as a drug by the National Drug Authority;

Many elements of this suit will be familiar to these involved in U.S Tobacco litigation. From the basic product liability and negligence claim to the decision of DIANNE CASTANO -v- THE AMERICAN TOBACCO COMPANY et al (fifth circuit No. 95-30725) and to the attempt to have tobacco regulated as a drug. Like in the Engle case the Plaintiff, claimed for damages for the infliction of mental anguish caused by smoking. The cases to be relied upon as authority for both parties mention several American decisions. We wait to see how the Judge will handle the case if ever it goes to trial.

From our examination of the U.S. Litigation experience, we learn that BAT Uganda is raising the traditional defences used by its Group; that there are other risk factors for the suffering claimed by the Plaintiff, that tobacco is not addictive, that there is no duty to warn consumers, that it is the plaintiff’s fault for smoking, that the dangers of smoking are common knowledge and interestingly that the cause of the Plaintiff’s injuries is an inherent characteristic of cigarettes which cannot be eliminated without substantially compromising the product’s usefulness or desirability.

In the earlier suit by the same Advocate VINCENT ORIBI VS. BAT AND ANOTHER H.C.C.S No. 207 of 2000, the Plaintiff claimed damages for personal injuries for the Defendant’s negligence in publishing a misrepresentative health caution. The plaintiff claimed that as a result of the misrepresentation, he suffered injury to his health. BAT ran essentially the same defences as soon above. In addition it names as witnesses 8 doctors in fields of epidemiology pathology pulmonology, toxicology, oncology, radiology, psychiatry and communications. These doctors are from universities and hospitals in the United States and United Kingdom.

Probably the largest advantage to us of the long U.S. Litigation history is to be found in the large documents, research and expertise pool available. That BAT Uganda is a member of the BAT Group makes it likely that industry documents discovered in litigation against other group members can be used against it. There is also a large pool of U.S attorneys familiar with the industry tactics who are more than happy to lend a hand to our efforts in Uganda and I am sure the same can be said of other professionals in the fight against tobacco. Elaw US, The Tobacco Products liability Project, Globalink, International Agency for Tobacco or Health have been very useful to us.

Our legal environment, in particular our constitution makes room for new actions to be brought against tobacco. Based on the right to life and the right to a clean and healthy environment coupled with generous locus standi provisions, it is possible to bring on wide array of rights enforcement and constitutional actions against tobacco. The Environmental Action Network Ltd. Actions Against Tobacco (TEAN-AAT) of which my firm is a founder member is considering employing this form of litigation to fashion a regulatory regime to control tobacco in Uganda. TEAN is contemplating actions for the protection of non-smokes from environmental tobacco smoke, to ban advertising, to require health warnings and ingredient and yield disclosures.

In this regard a decision from India has been most valuable. The decision in RAMAKRISHNAN –V- STATE OF KERALA O.P. NO. 24160 of 1998-A, because of the similarity of the legal provisions inherited by India and Uganda by reason of their Commonwealth tradition is directly relevant. The Petitioners in that case were granted declarations that smoking in public places was illegal and unconstitutional and for a writ of mandamus to command the Respondents to prosecute and punish all persons gully of smoking in public places. Uganda has identical provisions in its Penal Code and even stronger constitutional provisions.

It has been said that private litigation shifts enforcement of public health remedies from the enterprise or the government to the private individual. One writer condemned it as a dangerous delegation of democracy when contentious social economic or political matters are transformed into "legal issues". This may well be true. But it is in fact our appreciation for the need for a balance of competing interests and the need for public debate on these issues that we chose to adopt a multi-pronged strategy of which litigation is but one limb.

We are taking the first steps in litigation against tobacco in Uganda. There is a lot we need and a lot to be done. Local research is greatly needed. We will join hands with like minded parties and share what we have. We will litigate, advocate, associate, legislate, regulate and negotiate to make our neck of the woods smoke free.

I thank Professor Richard Daynard and the American Medical Association for making it possible for me to be here and I thank you all for your time.