WOODS HINTS HE MAY HELP RECALL EFFORT; HE, SYMINGTON CLASH OVER TOBACCO SUIT

By Kris Mayes and Martin Van Der Werf, Staff writers

Gov. Fife Symington on Thursday ordered Attorney General Grant Woods to drop a lawsuit against the nation's tobacco companies, prompting a defiant Woods to hint he may join a recall effort against the governor.

Symington said he told Woods to back off because he feels the suit is unwinnable. If the state lost, taxpayers would be stuck paying the private attorneys hired by Woods to represent the state.

"This is not in the best interest of the state of Arizona, of the taxpayers of Arizona," Symington said.

Woods said Symington has sold out to the tobacco companies and is risking the health of Arizona residents.

Woods stopped short of calling for Symington to step down but said he believes "it is time for the responsible people of this state to consider all of their options."

"That's what I'm going to do," he said.

Woods said he will now "think about" signing a recall petition against Symington, who has filed for personal bankruptcy and faces federal criminal charges arising from the collapse of his development company.

Woods was joined in his criticism of Symington by Republican state Superintendent of Public Instruction Lisa Graham Keegan, who said Symington's decision to ask Woods to withdraw from the suit could trigger "a constitutional crisis."

"We are continually battling a governor who thinks it's his responsibility to govern every aspect of daily life in Arizona," Keegan said. "Governor Symington, you need to listen to the people of Arizona."

Woods said Symington "is not the first person to be bought off by the big tobacco companies."

Woods did not offer any proof for his statements about Symington, and the governor said he would not respond to personal attacks.

"This issue has nothing to do with smoking. It has to do with policy by litigation that I think is a problem in this country. . . . My feeling is that this entire lawsuit should be dropped," Symington said.

He said the effect of his order was to "kick Grant Woods out of bed with the trial Bar."

Symington said the way to cut down on smoking deaths is through educational programs, such as a statewide advertising campaign, and not through recovering damages in a lawsuit.

Woods sued the tobacco companies in August for $500 million, saying they are liable for what the state has spent and will spend treating indigent patients afflicted with tobacco-related illnesses.

The suit was filed on behalf of Arizona and, specifically, the Arizona Health Care Cost Containment System, the state's health care program for the indigent. Symington's order withdraws AHCCCS as the client in the suit, but Woods said he will go ahead, anyway.

"I decide the policy of this state in consumer protection," he said.

He said that Symington's order is an "embarrassment" to the state and that he "resents it deeply."

At issue, according to Symington, is the way in which Woods proposed to pay for the lawsuit. Rather than have the state pay its own attorneys to conduct the suit, Woods followed the lead of other states suing tobacco companies and farmed out the lawsuit to private attorneys who would take the case on contingency.

Symington complained that too much of the potential winnings of the lawsuit would go to the private attorneys and that the agreement with the private lawyers mandates that the state pay for any "special facilities" they might need.

"Thus, the agreement you have negotiated in this matter subjects the state to potentially high costs and expenses for the purposes of pursuing extremely weak legal theories against the tobacco industry," the governor wrote to Woods.

Symington also complained that the attorney general was using state funds to file a lawsuit against an entire industry.

"It is a truly brave, new world of policy litigation when the government begins to file contingency-fee lawsuits against entire industries," Symington said.

AHCCCS Director John Kelly, in a separate letter to Woods, said his office would be rendered ineffectual in its other duties if it were forced to help Woods carry out the lawsuit.

A total of 17 states have filed lawsuits against the tobacco industry, and on Wednesday, New York City filed a similar suit.

Arizona is not the first state to have an intergovernmental war erupt over tobacco. Mississippi Gov. Kirk Fordice earlier this year sued Attorney

General Mike Moore, accusing him of misusing his authority. A decision by the Mississippi Supreme Court is expected in the next two weeks.

GRAPHIC (omitted): Color photos (2); 1) Grant Woods / Says Symington "is not the first person to be bought off" by tobacco companies. 2) Fife Symington / "This is not in the best interest of . . . Arizona, of the taxpayers of Arizona."

October 20, 1996 Sunday, Final Chaser; Pg. A2

SYMINGTON'S CALL TO SNUFF TOBACCO SUIT DEFIES EXPLANATION

by STEVE WILSON, Republic Columnist

With the approval rating of a rattler and the array of problems he has to wrestle with these days, why would Fife Symington pick a new fight that puts him squarely on the side of Big Tobacco?

(A) He hates Attorney General Grant Woods even more than we thought.

(B) His criminal and financial woes really are driving him bonkers.

(D) He's overdosing on DHEA.

I don't know the answer, but I wouldn't rule out anything, not even DHEA, the hot-selling hormone capsules claimed to counteract stress, preserve muscle, increase libido, and generally make middle-age men more manly.

Those pills would make as much sense as any of the reasons the governor gave for ordering Woods to drop the state's lawsuit against the nation's nicotine peddlers.

Symington said the lawsuit is weak, it will cost the state too much money, and even if successful, little of the cash would be returned to the state.

Those objections are bunk.

If Symington thinks Arizona's lawsuit is feeble, he would have called the one filed by 66-year-old Grady Carter absolutely anemic. Carter is just one more addicted smoker who eventually developed cancer; cigarettemakers have chewed up and spit out plaintiffs of his kind for years.

But two months ago, what do you know: A Florida jury told Brown & Williamson Tobacco Co. to pay him $750,000.

Tobacco's legal landscape is changing. The position of plaintiffs is far stronger today in light of new evidence of deceit by tobacco companies and more proof of the deadly, addictive nature of smoking.

If Arizona's lawsuit were half-baked, you would expect pretrial rulings on tobacco suits filed by other states to have been negative. In fact, most rulings have been favorable, and courts have upheld the legal theories that underlie the claims.

On the same day Symington demanded dropping the lawsuit, New York City Mayor Rudolph Giuliani, a prominent Republican, announced his city was filing a similar one.

"It would be mind-boggling for Arizona to withdraw at this point," said Richard Daynard, chairman of the Tobacco Products Liability Project at Northeastern University in Boston, which tracks litigation.

"There's no downside for Arizona to continue," Daynard added. "There's a good chance of success, and expenses are slight in comparison to the potential payoff of several hundreds of millions."

Regarding the cost of Arizona's lawsuit, Woods chose the least expensive way to go. The state's contingency agreement gives the lawyers 18 percent of any award. That's the lowest contingency fee of any of 17 states that are suing the tobacco companies.

Three kinds of lawsuits are pending against cigarettemakers: Some 600 individual suits filed by smokers, a dozen class-action suits on behalf of large groups of smokers, and the 17 state suits filed to recover expenses for treating indigents who have tobacco-related illnesses.

The states' cases have an advantage over the others, Daynard said. Tobacco companies can't use the "assumption of risk" argument that has been effective in blaming victims and saying they should have known the risks. Victims in the state suits are taxpayers, not smokers.

Hard as it is to stomach Symington's comments, the remarks by some Republican loyalists in response to Lisa Graham Keegan's call for the governor to resign are just as tough to take.

House Speaker Mark Killian managed to be both sexist and condescending by saying she was "having a bad-hair day."

U.S. Rep. John Shadegg said he was "mystified" by Keegan's statement.

Are these guys unaware that most of their constituents happen to share her opinion? The state schools superintendent says she agrees with seven out of every 10 adults in Arizona, and it's mystifying?

This is the sort of perspicacity that earns Arizona its distinctive national image.

One thing about Symington's blustering on behalf of Big Tobacco does make sense.

If any politician from a non-tobacco state is going to come to the aid of the country's least conscionable industry, it stands to reason that it would be America's least honorable governor.

October 18, 1996 Friday, Final Chaser; Pg. A1

TOBACCO SUIT PITS GOVERNOR AGAINST WOODS

By Kris Mayes and Martin Van Der Werf, Staff writers

Gov. Fife Symington on Thursday ordered Attorney General Grant Woods to drop a lawsuit against the nation's tobacco companies, but Woods vowed to defy him.

Symington said the suit is a lost cause that would stick taxpayers with thousands of dollars in private attorneys' fees.

"This is not in the best interest of the state of Arizona, of the taxpayers of Arizona," he said.

Symington said the way to cut down on smoking deaths is through educational programs, such as the current statewide ad campaign.

He and Woods, fellow Republicans who often have been political foes, used the tobacco issue to attack one another's character.

Woods accused Symington of "being bought off" by tobacco companies, while Symington said that he was kicking the attorney general "out of bed with the trial Bar."

Tobacco companies lauded the governor's stand, while anti-smoking activists and state schools Superintendent Lisa Graham Keegan denounced Symington.

Keegan later called for Symington's resignation, and Woods said he is pondering whether to sign a recall petition against the governor.

Woods sued the tobacco companies in August for $500 million, contending they are liable for money that the state spends to treat indigent patients afflicted with tobacco-related illnesses. Seventeen other states and New York City also are suing the companies.

Woods filed the suit on behalf of Arizona and, specifically, the Arizona Health Care Cost Containment System, the state's health care program for the poor. Symington's order withdraws AHCCCS as the client in the suit, but Woods said he will go ahead anyway.

"I decide the policy of this state in consumer protection," he said.

Woods conceded that AHCCCS' dropping out of the suit will hurt his case but said that "we will still be able to collect money damages."

"What this may prevent us from doing is proving that tobacco companies, rather than the citizens of Arizona, should pay for the health care of indigent citizens," Woods said.

He added that he could still pursue the companies through anti-racketeering laws.

At issue, according to Symington, is how Woods planned to pay for the $500 million lawsuit. Rather than have the state pay its own attorneys to conduct the suit, Woods followed the lead of other states suing tobacco companies and farmed the lawsuit out to private attorneys who would take the case on contingency.

Symington complained that too much of the potential winnings of the lawsuit would go to the private attorneys, and that the agreement with the private lawyers mandates that the state pay for any "special facilities" they might need.

"Thus, the agreement you have negotiated in this matter subjects the state to potentially high costs and expenses, for the purposes of pursuing extremely weak legal theories against the tobacco industry," Symington wrote Woods.

The governor also criticized Woods for using state funds to file a lawsuit against an entire industry.

"It is a truly brave new world of policy litigation when the government begins to file contingency-fee lawsuits against entire industries," he wrote.

AHCCCS Director John Kelly, in a separate letter to Woods, said his office would be rendered ineffectual in its other duties if it were forced to help Woods carry out the lawsuit.

Attorneys for Philip Morris Companies Inc. issued a statement applauding Symington.

William J. Maledon and Paul Eckstein said the governor was justified in his concerns that the lawsuit was a waste of taxpayer money.

"We believe the attorney general's lawsuit, which was prompted by out-of-state contingent-fee lawyers, is ill-advised, without any legal basis, and is a gross waste of the State's human and financial resources," the attorneys wrote.

Arizona is not the first state to have an intergovernmental war erupt over tobacco. Mississippi Gov. Kirk Fordice sued Attorney General Mike Moore, accusing him of misusing his authority in a tobacco suit, earlier this year. A decision is expected by the Mississippi Supreme Court in the next two weeks.

Moore is a close friend of Woods and persuaded him to join the lawsuit. At a news conference with Woods, Moore called Symington "the new Marlboro man of the West."

"There is a simple choice: On the one side is the taxpayers and the children of the state. On the other side is a $60 billion industry. Your governor has taken the side of the fat cats and the money interests," Moore said.

Anti-smoking activists were also taken aback by Symington's order.

Bill Pfiefer, chairman of the Coalition for a Smoke Free Arizona, called the announcement a"disappointing" setback.

"Clearly, its a disappointment to hear that our governor would require our attorney general to drop a lawsuit that is really designed to recoup funds from big tobacco," Pfiefer said. "I scratch my head on this one."

Health officials estimate that the direct health care costs of tobacco-related illnesses for Arizona's public and private sectors in 1993 was $327 million. In that year, 5,578 Arizonans died as a result of smoking. An estimated 420,000 people die each year nationwide from smoking-related illnesses.

GRAPHIC (omitted): Photo; Grant Woods / Has accused Symington of "being bought off" by tobacco companies.