Laborers Local 17 Health & Benefit Fund v. Philip Morris, Inc.
Plaintiffs, employee benefit trust funds, filed parallel class-action lawsuits alleging fraud and tortious conduct by several domestic cigarette manufacturers and related defendants, including B.A.T. Industries p.l.c. (BAT Industries) and Brown & Williamson Tobacco Corporation. The core allegation is that defendants concealed crucial information about smoking dangers, causing plaintiffs to incur millions in medical benefits for beneficiaries. BAT Industries moved to dismiss for lack of personal jurisdiction. The court examined grounds for jurisdiction under New York's long-arm statute (CPLR § 302(a)), RICO statutes, a conspiracy theory, and an alter-ego theory. It found that plaintiffs failed to establish a prima facie case for personal jurisdiction over BAT Industries, noting that many alleged conspiratorial activities predated BAT Industries' formation in 1976 and that no sufficient links or control were demonstrated. Consequently, the motion to dismiss was granted, but with leave for plaintiffs to amend their complaint by September 30, 1998, to plead facts that could support jurisdiction under a conspiracy theory.