FOREIGN GOVERNMENTS SET TO LIGHT UP US COURTS

FOREIGN GOVERNMENTS SET TO LIGHT UP US COURTS

A rash of foreign governments are filing lawsuits against U.S. tobacco companies in U.S. courts.

The suits, filed so far by Panama, Guatemala, Nicaragua, Bolivia and Venezuela, and perhaps soon by Russia and Brazil, are patterned after tobacco lawsuits filed by U.S. states and settled for $246 billion.These lawsuits should concern Americans because if the foreign countries win, the tobacco companies may be unable to pay the $246 billion settlement to the 50 states. This would cause cuts in state services or tax increases.

Also, if even a few countries win, the doors will be opened to future lawsuits against U.S. corporations. This will transfer money to foreign governments and cause layoffs and a depression of stock prices in the United States.

Regardless of who wins, the U.S. taxpayer still will be stuck with court costs.

The suspicion is that foreign nations sense a possible cash windfall, and are filing suits to be the first to get it. This may be why the foreign governments are suing U.S. and British tobacco firms but not their own local tobacco companies.

These nations claim that they are due money because they were unaware of tobacco's danger until just prior to the filing of their lawsuits.

Guatemala, for instance, claims that U.S. tobacco companies ''lied to Guatemala . . . by misrepresenting cigarettes as harmless.'' As a result, Guatemala says, it did not act to reduce smoking by Guatemalans. Local tobacco firms, Guatemala says, were not involved in the deceit.

To believe Guatemala one must believe that its entire government had no information about the dangers of tobacco until 1998. Guatemala's statement is even more ludicrous when one considers that a U.S. company controls about 73 percent of the Guatemalan tobacco market while a local firm controls 27 percent.

Guatemala is making contrary statements: that it did not know about the dangers of tobacco because the companies selling tobacco in Guatemala didn't tell them, and that the company that sells 27 percent of the cigarettes in Guatemala did not hide the truth about tobacco.

The role of lawyers in convincing these countries to sue U.S. firms is also suspect, as private U.S. lawyers stand to make fees totaling perhaps 15 percent to 30 percent of the total award, should any tobacco companies lose or settle.

The countries filing these suits may believe that tobacco companies will settle. If so, they're probably wrong. Tobacco companies settled with states in part because they believed that U.S. jurors would be biased in favor of state governments. But they don't believe U.S. jurors will be biased toward foreign governments.

Tobacco companies also can't afford to settle. Paying Guatemala is one thing, but if Guatemala gets a settlement, Brazil, Russia, India and China will most likely all demand a settlement in line with the size of their own, much larger, populations.

U.S. tobacco companies simply don't have that kind of money.

Another reason U.S. tobacco companies won't settle is that the tobacco companies will probably win.

U.S. lawmakers concerned about the negative economic impact of foreign government lawsuits filed in the United States against U.S. firms can take steps to assure that this type of lawsuit is not filed frivolously. They could pass ''loser pays'' provisions to mandate that if a foreign country sued a U.S. business in the United States. and lost, the foreign country would reimburse the legal expenses of the winner.

U.S. lawmakers could also enact a windfall-profit tax on any U.S. lawyer who makes over a certain amount - say, a million dollars - for encouraging and helping a foreign government win a case against American business. This would allow lawyers to be paid for their work but give them little incentive to go abroad to generate cases solely for the purpose of receiving hundreds of millions in fees.

The nations filing lawsuits against U.S. businesses also should consider this: Lawsuits can go both ways. If it is appropriate to sue a U.S. firm over tobacco - a product legally sold in each nation, and one which each nation taxes for revenue, making them partially responsible for its effects - then why couldn't our states, localities and federal government sue these countries for exporting illegal drugs?

And why shouldn't the United States, its states and localities sue foreign governments for the expenses of illegal aliens?

It would be far better if each nation simply took responsibilityfor what is going on within its own borders instead of trying to profit by claiming that others are responsible.

Historically, the United States has often been criticized for involving itself in the internal affairs of Latin American nations. It would be ironic if the same nations that have complained about U.S. interference now persist in attempting to prove in court that Americans are more responsible for what goes on in their countries than they themselves are.