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Excerpts from: Asbestos-Related Tobacco Case Ends in Mistrial

By Reuters  Asbestos-Related Tobacco Case Ends in Mistrial [01/25/01]

The first asbestos-related case against the tobacco industry to reach a jury ended in a mistrial in a
Brooklyn, N.Y., federal court on Thursday, according to R.J. Reynolds Tobacco Co. and Philip Morris Cos Inc., two of the
defendants in the case.

The case was brought by the trustees of the Johns Manville Personal Injury Settlement Trust, which argued that the tobacco
industry should be required to pay its ``fair share'' of damages the industry caused the trust's claimants.

The case is widely known as Falise, after the chairman and managing trustee of the trust, Robert Falise.

The independent trust fund, set up by building products maker Johns Manville Corp. to pay asbestos victims claims, brought a
suit against the tobacco industry, alleging that smoking adds to the health risks of asbestos exposure.

Asbestos, an indestructible fireproof insulator that is no longer used, can be deadly because inhalation of its fibers can lead to
lung cancer and other serious diseases.

R.J. Reynolds, the second-largest U.S. tobacco company after Philip Morris, is the cigarette-making unit of R.J. Reynolds
Tobacco Holdings Inc. .

According to the companies, Senior U.S. District Judge Jack Weinstein of the Eastern District Court of New York declared the
mistrial after receiving several notes from jurors advising him that they were deadlocked and that further deliberations would be
futile.

Other defendants in the case included Brown & Williamson Tobacco Corp., a unit of British American Tobacco Plc ; Lorillard
Tobacco Co., a unit of Loews Corp. ; American Tobacco Company, and Liggett Group Inc., a unit of Vector Group Ltd. .

Credit Suisse First Boston tobacco industry analyst Bonnie Herzog said that according to the jury foreman, 10 of the jurors
wanted to find for defendant, while two wanted to find for the plaintiff.

``We would consider this mistrial essentially a win for the industry,'' Salomon Smith Barney tobacco industry analyst Martin
Feldman said in a research note. Feldman said Weinstein declared a mistrial ``as a result of severe and irreconcilable dissension
among the jurors.''