A View from the Top
An Interview with Carmen Shepard
By Peter K. Andreone
Originally appearing in Slackwater, Volume 3
With a tape recorder under my arm, I dashed from a parking lot into St. Paul’s Plaza in downtown Baltimore, desperately attempting to avoid the soaking November rain. When I first entered the building, a large security officer greeted me. He made me sign in and asked whom I was there to see. “Carmen Shepard,” I replied, feeling quite important to have an appointment with the Assistant State General. I was there because Attorney General J. Joseph Curran represented Maryland in the Master Settlement Agreement. I hoped that Shepard could describe the role the department played in the settlement as well as account for the contradictions in Maryland’s claims. For example, how does a state that produces tobacco turn around and sue the manufacturers?
PA: Can you explain to me what your job involves?
CS: I help the Attorney General supervise an office of about five hundred people, including over three hundred lawyers whose job is basically to do the legal business of the State in areas ranging from giving legal advice on how to fund the State debt, to every small piece of litigation, including an automobile accident in a State-owned car.
PA: What was your role in the Master Settlement Agreement?
Photo by Ben Ashby on Unsplash
CS: Early on, Joe [Attorney General J. Joseph Curran] had decided that the tobacco companies were indeed responsible for violating State laws in many ways. Primarily they were violating the Consumer Protection Act and the antitrust laws by conspiring and engaging in what he thought was misleading—and knowingly misleading—information and marketing about cigarettes. Essentially, what he uncovered, and what we confirmed in the litigation, is that early on the industry was well aware both of the addictive nature of nicotine, a product that doesn’t really need to be in a cigarette, and the adverse health effects. But the companies instituted a campaign to try to hide both these facts, going so far as sponsoring so-called scientific studies, which were in fact funded by the industry, to refute it. So, that’s what we were targeting at the beginning. We were trying to treat tobacco, and cigarettes particularly, just like any other consumer product: You can sell them, but you’ve got to tell the truth about them.
Back at the beginning when we thought about this, no one had ever recovered a dime against the cigarette companies anywhere. So, in many ways, a lot of people viewed it as a long shot. We were the fifth state to announce [our intentions] and the eighth state to file suit. By the end of the process, there were 46 states, all of whom were suing the tobacco industry. And it was the momentum of that national effort in litigation, and a very well-coordinated effort I may add, that brought the tobacco industry to sit down and say, “Wait a minute, maybe the best thing that we can do is settle this.” Basically, what they were looking at were a few judgements in a few good cases, and they would be in bankruptcy. We, on the other hand, were looking at public health issues, not only money. I mean, money was certainly important, but probably the most important from our point of view was trying to keep their marketing within bounds. Again, as I said before, it’s okay to sell the product; you just have to tell the truth about it. And so we were looking at court-ordered relief that would order them to tell the truth and restrict their advertising and keep it away primarily from children.
That began the process of negotiating a settlement. Both sides realized that they had a lot to lose if they just gambled everything in trial. If we went to trial and we lost, we’d have no protection. If they went to trial and they lost, they’d be down a path where basically…I mean, we couldn’t end cigarette smoking, but these particular companies might lose their financial viability. The process of negotiating, though, lasted years, to tell you the truth, Peter. You may recall from reading the newspapers that the first effort that came up was one that involved action by Congress, and it was an attempt to take care of the problem nationally. Basically, it would have taken care of any federal suit as well as any state suit.
The way we viewed it in this office was, if we were going to settle or win this case, [our goal] was to try to correct some of the wrongs caused by tobacco, so getting money wasn’t good enough. Money should be dedicated to establishing anti-smoking programs, to corrective advertising, to telling people the truth. It should be directed at finding cures for cancer, emphysema, and other diseases caused by smoking.
We knew we’d get billions of dollars, but ultimately, we were going to be judged by whether we had made a difference in the culture of cigarettes, particularly in the culture of children and cigarettes. So, we felt very strongly that the money ought not to be diverted to pay the national debt or anything else but targeted towards correcting some of the problems associated with tobacco. For a lot of reasons, those efforts in Congress fell apart. States went back to litigating, and ultimately what the tobacco companies decided is that they were going to forgo a national federal legislation. And instead, they looked for settlements simply with the states. And that really is what led to the Master Settlement Agreement. We peeled off the state part from the national federal government part. The federal government has since sued the tobacco companies.
PA: How is the money that Maryland receives from the Master Settlement Agreement going to be dispersed?
CS: There are three major things that were targeted with tobacco money. One was the health effects—for anti-smoking programs and smoking prevention and smoking cessation. To help people who do smoke, quit, and people who might start, not start. Number two was targeting the medical effects of tobacco smoking, and so there’s a major initiative to fund some cancer research that may actually help reverse some of the problems with tobacco. The third was one that was very important to the State of Maryland, and this is that Maryland does have a history, a tradition, and a section of its economy based on tobacco. If we succeed in parts one and two of the program, fewer people will smoke, so what’s going to happen to tobacco? Well, the answer is clearly that there won’t be as much of a demand. And so long-term, if this succeeded, the farmers were looking at the end of a tradition and, for many of them, an actual livelihood, a way to send their kids to school. So, the third major prong was to direct money towards farmers and other workers in the tobacco industry.
PA: Well before Maryland became a state, and certainly after, it has promoted and supported tobacco production…
CS: Truly, it’s even in the [Calvert County flag and seal]…
PA: Because the State promoted tobacco, do you think that Maryland would have had a case against the tobacco companies if the Master Settlement Agreement had not come about?
CS: I actually think so, Peter. I mean, in a sense, tobacco and cigarettes are closely tied together but there was more here than just tobacco and cigarettes. There is actually a pattern of marketing [that involves] hiding [information] and deceiving people about the actual efforts. I know that sometimes for people today that’s hard to understand. Everybody knows smoking is bad. Believe it or not in the 1940s, which is when a lot of people that are sick today started smoking, they were actually selling it as good for your health. The answer is yes. I think the fact that you grow tobacco doesn’t mean that you were participating in that kind of scheme and deception. Obviously, we did take the case. We did think we had a shot.
PA: To what do you attribute the change in the State’s attitude from supporting tobacco to attempting to cease its production?
CS: I think it’s just the overwhelming and very sad fact about what happens to people when they smoke. Nationally, [there are] over 400,000 deaths a year just from smoking, and at some point you realize that people do die if they smoke, or at least get very badly injured. You can’t ignore that fact. I mean, it certainly has provided a subsistence and a structure for part of Maryland’s economy. On the other hand, it’s killing a lot of Marylanders. So eventually, over time, as you get more information about the actual effects, you’ve got to reach a decision that, unfair as it may be to particular individuals, overall, it would be a mistake not to try to stop the medical damages.
PA: Do you feel this opinion might change when Governor Glendening leaves office?
CS: He certainly has been a leader in trying to go about this in a very intelligent way. What he is trying to do is to target some of the tobacco money [in order to] shift from tobacco to another crop, another mode of production. [It is] admittedly not an easy thing to do; I mean, we are talking about restricting farms that have existed for generations. He’s trying to give more benefits to people who are trying to shift from one crop to another, or into another industry altogether. I think it’s a smart way to go at it. I’d like to think that whoever comes after him will still pursue that. I don’t think today that anyone can foresee the future of tobacco, but I think all the signs say that there ought to be less consumption. And so, I think it’s inevitable that the reality will have to be faced, and I think it’s better to try and support the farmers that are dealing with it, not to sort of leave them on their own to deal with whatever happens with the [declining] consumption of cigarettes.
PA: How did the Office of the State Attorney General view the Southern Maryland Strategic Plan proposed to the Tri-County Council, specifically the transition and buyout programs?
CS: We were happy to work with and support the Tri-County Council. They’re right there [in Southern Maryland], and they’re in the best position to try to figure out what makes sense. So, we tried to be as supportive as possible of the Tri-County Council and make sure that their views were being heard, not only by the Secretary of Agriculture, but also in the Governor’s office and the General Assembly. Beyond that, we did not offer them any technical expertise; rather, we were counting on their technical expertise to develop the program.
PA: How do you think this legislation will affect Southern Maryland?
CS: I don’t know, and it worries me a little bit. Certainly, we can look back in history and see that tobacco has been more than just a crop; it has also organized a way of life in the counties. It has even defined the land visually in Southern Maryland. There’s a certain character that I hope remains, even as the consumption of tobacco diminishes, and hopefully it can be replaced with something of similar character to preserve the unique history and relationships in Southern Maryland. But beyond that I can’t tell you. I wish I could. I wish I had a better vision of what would happen. I hope it is not simply land that is sold for intense housing development. I think we’re going to have to go a little bit at a time to see what happens.
