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Government has paid €4 million to firms linked to Big Tobacco since 2013

James Reilly oversaw a €300,000 contract involving a law firm that had represented the tobacco industry when he was Health Minister.

Updated 3.25pm

Plain pack cigarettes Source: PA Archive/Press Association Images

GOVERNMENT DEPARTMENTS AND State agencies have, since 2013, paid out close to€4 million in consultancy fees to companies who have also represented the interests of Big Tobacco.

Figures from seven government departments show that in the last two years alone, payments of as much as €1.7 million have been made to firms who also provide, or have provided, legal and consultancy services to major tobacco companies.

The issue has come into sharp focus after Children’s Minister James Reilly effectively called for a government-wide boycott of lawyers and consultants who represent tobacco firms.

On RTÉ Radio’s This Week programme just over a week ago, Reilly was asked: “Would you like to see people who have represented tobacco in the past, or currently represent tobacco interests, not to be used by your colleagues in government?

He replied:

Personally – absolutely. I don’t believe people can be representing the tobacco industry and be representing, certainly me – and I’d much prefer if the rest of government wouldn’t have any truck with them either.

An analysis by TheJournal.ie, however, shows that at least four such companies have been paid a total of €3,939,757 for consultancy work since the beginning of 2013, when plans for plain packaging were first launched.

Before that, the Department of Health under James Reilly gave a legal firm linked to the tobacco industry a joint contract worth more than €300,000.

Responding to TheJournal.ie‘s story today, Reilly was asked if he ultimately wanted to see an end to government departments working with firms that represent Big Tobacco:


Source: hughoconnellthejournal.ie/SoundCloud

A government spokesperson told TheJournal.ie that the Taoiseach “fully supports Minister Reilly’s work” on plain packaging, but cautioned:

The government has not considered new criteria for consultancy contracts which are already subject to public procurement guidelines. However, where a clear conflict of interest exists, this can be taken into consideration during the tender process.

New Cigarette Packets Source: Laura Hutton/Photocall Ireland

Government departments and state agencies every year award hundreds of contracts to private sector businesses for a wide range of services including construction, cleaning, official photography, legal advice and PR.

Procurement, the process of advertising a need for services, accepting bids and awarding contracts, is governed by strict ethical and legal guidelines, to prevent conflicts of interest.

Equally, law firms – especially larger ones – are required to put in place “ethical barriers” when different teams are acting on behalf of opposing clients, as explained in this Law Society practice note:

The guidelines address the extra precautions that firms should take in those circumstances to ensure that no conflict of interest arises and there is no breach of the duty of loyalty, the duty to make full disclosure, and the duty of confidentiality owed to each client.

According to Professor John Flood from the UCD School of Law, large legal firms are akin to “a series of interlocking networks.”

Increasingly, firms have a kind of ‘risk register’ – where all clients are entered into a database and are checked for potential conflicts of interest.

This task is usually overseen by a designated “risk officer.”

In addition, the need for client confidentiality means larger firms generally set in place “information screens”, meaning certain lawyers are locked out of certain areas of the firm’s computer system, and work in separate offices.

The practice of client confidentiality means it’s not possible to compile a comprehensive list of firms hired by tobacco companies, and departmental expenditures for 2014 haven’t been fully published in all cases.

That being said, here’s a breakdown of the last two years of state contracts to firms that have also worked on behalf of the tobacco industry:

Arthur Cox Solicitors

15/9/2010 Arthur Cox Solicitors Source: Photocall Ireland

Acting on behalf of Japan Tobacco International, they recently sent a letter to Ministers Reilly and Varadkar threatening legal action if planned plain packaging legislation is implemented, sparking Reilly’s call for a new procurement regime.

  • 2014: Paid €345,798 by the Departments of Finance and the Environment, including €184,000 for their help setting up Irish Water.
  • 2013: Paid €2,085,648 by the departments of Finance, Jobs, Social Protection, Education, and Public Expenditure, including legal advice to NAMA and the NTMA.

The firm is one of the largest in the state, with 350 lawyers working in dozens of practice areas, for clients from a wide range of sectors.

It also has a long history of representing the tobacco industry, acting on behalf of Gallaher Tobacco (since acquired by JTI) in product liability cases throughout the 2000s.

Between October 2010 and January 2011, the HSE Board settled on the firm for a €58 million contract to manage their procurement of legal advice from another 35 firms.

“To manage any risk associated with conflict of interest,” in the words of then Health Minister Mary Harney, the HSE in turn hired McGrigors Solicitors of Edinburgh to manage the process that led up to Arthur Cox being awarded the lucrative contract.

In September 2010, months prior, McGrigors itself represented Imperial Tobacco – the world’s fourth-largest tobacco company – in an attempt to strike down legislation against cigarette advertising in Scotland.

Between 2008 and 2010, Arthur Cox was paid €9.66 million for “banking stabilisation services” and consultancy work in the aftermath of the Bank Guarantee.

The firm declined to comment for this article.

A & L Goodbody Solicitors

  • 2014: Paid €3,671 by the Department of Finance
  • 2013: Paid €354,715 by the Departments of Finance, Jobs, Social Protection, Education and Public Expenditure, including €220,914 in legal fees from the Ombudsman’s Office overseen by Minister Brendan Howlin.

Between 2012 and 2013, the Department of Jobs, Enterprise and Innovation paid A & L Goodbody close to €168,000 – far more than it did any other consultancy firm.

In 2003, A & L Goodbody represented PJ Carroll (now a subsidiary of British American Tobacco) in the High Court, challenging Health Minister Micheál Martin on the constitutionality of the 2002 Tobacco Act.

On its website, the firm – which has 420 legal staff in five offices and three countries – promotes its experience in the “successful defence of regulatory prosecutions and product liability claims” for British American Tobacco.

It also boasts that “in hundreds of multiple product liability/personal injury claims” against PJ Carroll, “no claims against our clients have succeeded in Ireland.”

A & L Goodbody declined to comment for this article.

The company recently shared €3 million in fees with another firm, for its legal advice on the set-up of Irish Water. That firm is McCann Fitzgerald.

McCann Fitzgerald Solicitors

Imperial Tobacco restructuring Source: PA Archive/Press Association Images

  • 2013: Paid €224,239 by the Departments of Finance and Public Expenditure.

The firm is currently representing Imperial Tobacco and opening a second front in challenging James Reilly’s plain packaging legislation, according to a report in the Irish Independent last week.

In a case spanning six years between 1997 and 2004, McCann Fitzgerald defended John Player (now a subsidiary of Imperial Tobacco) against a class-action lawsuit involving 138 smokers alleging criminal negligence and breach of duty.

Along with Arthur Cox and A & L Goodbody, the firm was given a three-year contract for “corporate legal services” in relation to NAMA, by the Department of Finance.

In 2012, the Department of Justice paid them €495,232 for six months’ advice during the formulation of the Insolvency Bill.

McCann Fitzgerald – which has more than 300 legal staff in Dublin, London and Brussels – has an ongoing contract with the Department of Transport as legal advisor to NewERA, as it considers IAG’s bid to take over Aer Lingus.

A spokesperson for the firm did not respond to TheJournal.ie’s requests for comment.

Matheson Solicitors

  • 2014: Paid €20,691 for consultancy work with the Department of Jobs.
  • 2013: Paid €904,994 by the HSE, and the Departments of Public Expenditure and Finance – including legal advice on the “acquisition and sale of Irish Life.”

In the 2000s, the firm then known as Matheson Ormsby Prentice represented Philip Morris – the world’s largest tobacco manufacturer – in the Irish High Court, challenging the constitutionality of regulations about cigarette advertising.

In 2011, Health Minister James Reilly gave it the task of reviewing the private health insurance market, along with an accounting firm, in a joint contract worth over €300,000.

Today, we asked Reilly if he regretted this decision:


Source: hughoconnellthejournal.ie/SoundCloud

Between 2012 and 2013, the Department of Finance paid Matheson just over €1 million for advice relating to the NTMA.

The firm has 350 legal and tax staff across 20 practice areas, in four offices in Dublin, London, New York and Silicon Valley.

Matheson Solicitors declined to comment for this article.

‘What appropriately can be done’

Taoiseach Enda Kenny(right) and Ministe Source: Sasko Lazarov/Photocall Ireland

Minister Reilly has upped the ante in his efforts to ostracise companies that do business with the tobacco industry.

After receiving the letter sent on behalf of JTI, he asked his department’s secretary-general for a review of the relationship between Tusla, the Child and Family Agency, and Arthur Cox Solicitors, who are their legal advisors.

In response to a number of questions from TheJournal.ie, a spokesperson for Minister Reilly would only say that the secretary-general had reported back, and that the Minister was now seeking legal advice as to “what appropriately can be done” in relation to Tusla’s contract with the firm.

Speaking to reporters today, Reilly said:

“I’ve asked my department to seek legal advice in relation to ensuring that there is no future conflict of interest, real or perceived, that could be in any way contrary to the best interests of children and that’s where it lies at the moment.”

Last week, the Irish Cancer Society announced it would no longer be accepting donations from the firm on the basis of its representation of JTI.

It remains to be seen, however, whether Reilly’s ministerial colleagues will join him in ridding their departments of the extensive services of companies who have worked with Big Tobacco.

- additional reporting form Hugh O’Connell

Read: Irish Cancer Society rejects money from Arthur Cox law firm over tobacco links>

It’s highly likely there will be a legal challenge to plain tobacco packaging, says Law Society>

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About the author:

Dan MacGuill

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