Ethical & Legal Issue

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Altria Group, Inc. is the name of the parent company of Kraft Foods, Philip Morris USA, Philip Morris International and Philip Morris Capital Corporation.


Philip Morris Companies has struggled with its own issues with the public trust for a long time.


Through a combination of arrogance and ignorance, for many years US tobacco business didn’t engage with or address legitimate concerns people had with regard to cigarettes. Tobacco businesses reaction to criticism was to ignore it, hoping that it went away � or to slug it out in court. Their approach generally was, if it’s legal, then its right.


Tobacco business failed to understand that society has legitimate concerns that went far beyond whether they followed the letter of the law � issues like youth smoking, addiction, second-hand smoke and how cigarettes are manufactured and marketed.


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They were wrong when they assumed that the public would eventually come to understand their side of the story if they won in court.


And in the end, they had no one to blame but themselves for losing the public’s trust.


In the year ahead they should understand something very important � that accessibility, a willingness to listen and the courage to communicate openly are hallmarks of any responsible organization.





Recent Legal Issues


Ø The record-breaking $145 billion Florida judgment for punitive damages was sent back from a federal court to Floridas court system.


Ø The European Commission, which represents the 15-country European Union, filed a civil suit in a New York court on Friday alleging that Philip Morris, along with R.J. Reynolds, engaged in cigarette smuggling that reportedly cost the EU billions of dollars in lost taxes and import fees.


Ø On March 1, an Illinois judge ruled that Philip Morris USA, the top U.S. cigarette maker, deceived smokers into thinking light cigarettes were safer than regular smokes. He ordered it to pay $10.1 billion in damages and post a $1 billion appeal bond, which he cut almost in half this week.


Ø On April 16, quarterly profit fell, hurt by poor U.S. sales of its Philip Morris cigarettes, and it suspended its share buybacks.





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