Court Opinion

ID: 185398
Source: CourtListenerOpinion
Date Created: 2011-02-05 02:31:29+00
Date Added: 2024-06-11T17:26:15.543312
License: Public Domain

249 F.3d 1068 (D.C. Cir. 2001)
Service Employees International Union Health and Welfare Fund, et al., Appelleesv.Philip Morris Incorporated, et al., AppellantsThe Republic of Guatemala Appellantv.The Tobacco Institute, Incorporated, et al., Appellees
No. 00-7023, No. 00-7093 to 00-7100,00-7118 and 00-7120
United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued February 21, 2001
Decided May 22, 2001

Appeals from the United States District Court  for the District of Columbia (No. 98cv00704) (No. 98cv01185) (No. 99cv01535) (No. 98cv01569) (No. 98cv01716) (No. 99cv02326) (No. 99cv03080) (No. 99ms00213)
Herbert M. Wachtell argued the cause in No. 00-7093 for  appellants.  With him on the briefs were Peter C. Hein,  David S. Eggert, Timothy M. Broas, Michael K. Atkinson,  Robert F. McDermott, Jr., Paul S. Ryerson, Robert H. Klonoff, Paul Reichert, Kenneth N. Bass, Leigh Hyer, Janet L.  Goetz, Joseph Barloon, Keith A. Teel, D. Edward Wilson,  Michael B. MacWilliams, Peter A. Woolson, Judah Best and  John Parker Sweeney.  Newman T. Halvorson, Jr. entered  an appearance.
Michael C. Spencer argued the cause in No. 00-7093 for  appellees.  With him on the brief were Daniel Edelman and  Roger M. Adelman.
Arthur R. Miller argued the cause in No. 00-7023 for  appellants.  On the briefs for appellants and amicus curiae  Guatemalan National League Against Cancer were George M.  Fleming, Sylvia Davidow, Andres C. Pereira, Richard M.  Martin, Jr., Nicholas Gilman, and Jonathan S. Massey.
Herbert M. Wachtell argued the cause in No. 00-7023 for  appellees.  With him on the brief were Peter C. Hein, Timothy M. Broas, Michael K. Atkinson, Robert F. McDermott,  Jr., Paul S. Ryerson, Kenneth N. Bass, Leigh Hyer, Garyowen P. Morrisroe, Thomas J. McCormack, Timothy M.  Hughes, Robert E. Scott, Jr., Joseph M. McLaughlin, Gene E.  Voigts, Richard L. Gray, John Vanderstar and Judah Best. Keith A. Teel, David Gruenstein, Daryl L. Joseffer, Michael  A. Schlanger, Peter A. Woolson, and D. Edward Wilson, Jr.  entered appearances.
Robin S. Conrad and Kenneth S. Geller were on the brief  in No. 00-7023 of amicus curiae The Chamber of Commerce  of the United States.
Before:  Williams, Sentelle and Rogers, Circuit Judges.
Opinion for the Court filed by Circuit Judge Rogers.
Rogers, Circuit Judge:

1
In these two appeals, the court  must determine whether the plaintiffs have demonstrated  proximate cause in seeking, on an aggregate basis, to recover  costs incurred as a result of paying for the health care needs  of individual smokers.  The complaints allege conspiracy and  fraud in connection with federal antitrust and racketeering  ("RICO") claims as well as antitrust claims under District of  Columbia law and common law claims.  Similar claims have  been considered and rejected as too remote by seven other  circuits.  Because we agree with the other circuits that the  alleged injuries of the third-party payors are too remote to  have been proximately caused by the defendants' alleged  conduct, we reverse the denial of the motion to dismiss with  respect to the RICO and fraud claims in Service Employees  International Union Health and Welfare Fund v. Philip  Morris Inc., 83 F. Supp. 2d 70 (D.D.C. 1999) ("Service  Employees"), and otherwise affirm the dismissal of the complaints in Republic of Guatemala v. Tobacco Institute, Inc.,  83 F. Supp. 2d 125 (D.D.C. 1999) ("Guatemala").

I.
A.

2
In Service Employees, several labor-management health  trust funds ("the funds"), see 29 U.S.C.186(c)(5) (1994),  sued Philip Morris, other tobacco companies, and other entities related to the tobacco industry, alleging a fraudulent  scheme to preserve their control of the cigarette market and  to avoid the costs of treating smoking-related diseases by  counteracting smokers' efforts to quit, by impairing the ability of health care providers to reduce costs through effective  smoking cessation programs and safer cigarettes, and by  concealing the tobacco industry's active role in manipulating  and perpetuating the resulting health care crisis.  The funds  seek to recover their payments for participants' smokingrelated health care costs by "su[ing] in their own capacities,  rather than asserting claims in subrogation on behalf of  individual [f]und beneficiaries."

3
The district court granted the defendants' motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) the  funds' local and federal antitrust claims for lack of an antitrust injury and for failure to specify antitrust damages. Service Employees, 83 F. Supp. 2d at 89-91.  The court  dismissed the funds' fraud claims without prejudice for failure  to plead fraud with particularity as required by Federal Rule  of Civil Procedure 9(b).  Id. at 91-92.  The district court also  dismissed the funds' special duty, indemnity, and unjust  enrichment claims.  Id. at 92-94.  Denying the motion to  dismiss with respect to the funds' RICO claims, however, the  district court accepted the funds' characterization of their  injuries as "direct injuries to the trust assets," id. at 86, or  harm "to their infrastructure and financial health and stability," id., and rejected the view that such damages are entirely  derivative of the harm suffered by the funds' beneficiaries, id.  at 89.  While the district court acknowledged the analytical  framework provided by the Supreme Court in Associated General Contractors of California, Inc. v. California State  Council of Carpenters, 459 U.S. 519 (1983) ("AGC"), and  Holmes v. Securities Investor Protection Corporation, 503 U.S. 258 (1992), it addressed proximate cause in terms of  foreseeability and direct consequences, guided by the twopart test set forth in the Restatement (Second) of Torts431  (1965).  Service Employees, 83 F. Supp. 2d at 80-83.  The  district court concluded that foreseeable harm to the funds  stemming from defendants' alleged conduct was "obvious," id.  at 84, and resolved difficulties otherwise posed by the nature  of the funds' claims by invoking "the inherent ability and  flexibility of our common-law based legal system to respond  to the demands of a case as difficult as this," id. at 79-80.

4
The defendants, in seeking reversal on the RICO and fraud  claims, rely principally on what they characterize as "150  years of controlling precedent" regarding proximate cause  under the common law that the Supreme Court's decisions in  AGC and Holmes have incorporated in analyzing standing to  pursue federal antitrust and RICO claims.  Holmes, 503 U.S.  at 267-70;  AGC, 459 U.S. at 529-35.  In addition to relying  on the rule that one who pays the medical expenses of  another may not recover in a direct suit against the tortfeasor  but must proceed by way of subrogation, cf. Indus. Risk  Insurers v. Creole Prod. Servs., Inc., 746 F.2d 526, 528 (9th  Cir. 1984);  Rock Island Bank v. Aetna Cas. & Sur. Co., 692 F.2d 1100, 1106-07 (7th Cir. 1982);  Great Am. Ins. Co. v.  United States, 575 F.2d 1031, 1033-34 (2d Cir. 1978), the  defendants rely on the decisions of the circuit courts of appeal  that have rejected such third-party payor suits against the  tobacco industry.  The funds, in turn, appeal the dismissal of  all of their other claims save for their special duty and  indemnity claims.

B.

5
The Republics of Guatemala, Nicaragua, and Ukraine ("the  nations") seek to distinguish their claims from those of the  typical third-party payor whose fate is sealed by the decisions  of other circuits.  They contend that as sovereign nations constitutionally (or otherwise legally) obligated to provide  free health care and other forms of social welfare to their  residents, or at least to those who cannot afford to pay for  such benefits, they have suffered economic harms to their  treasuries that are independent of any harms allegedly suffered by their residents as a result of smoking defendants'  products.  The nations maintain that they are not only the  best but the only plaintiffs who can recover for the economic  harm allegedly suffered by their public fiscs.  Further, they  claim a purported right to sue in parens patriae that they  view as overcoming concerns about their standing to recover  their economic losses under RICO and the federal antitrust  laws.

6
The district court dismissed the complaints in their entirety.  Guatemala, 83 F. Supp. 2d at 128.1  Without adopting  the defendants' position that the nations are merely complaining of a purely derivative harm, and acknowledging that the  doctrine of remoteness affords courts flexibility in determining whether the alleged injury is remote from the alleged  misconduct, the district court considered it "abundantly clear  that the injury that [the nations] purportedly suffered occurred only as a consequence of the harm to individual  smokers."  Id. at 129.  The district court concluded that the  "tortured path" from the defendants' alleged wrongdoing to  the nations' increased expenditures "demonstrates that [the  nations'] claims are precisely the type of indirect claims that  the proximate cause requirement is intended to weed out." Id. at 130 (quoting Steamfitters Local Union No. 420 Welfare  Fund v. Philip Morris Inc., 171 F.3d 912, 930 (3d Cir. 1999)  ("Steamfitters")).

7
In seeking reversal, the nations contend that the district  court misapplied the Holmes factors, ignored the foreseeable  nature of the harms alleged as well as public policy considerations in conducting its proximate cause analysis, failed to  address the alternate chain of causation alleged by the nations, and failed to acknowledge the nations' unique status as foreign sovereigns.  Essentially, the nations urge this court  to adopt the district court's proximate cause analysis in  Service Employees and to give special weight to their right to  sue as parens patriae.  They also contend that the district  court erred in not allowing them to replead their fraud and  RICO claims.  See Guatemala, 83 F. Supp. 2d at 135 n.8.

II.

8
Our review of the district courts' partial denial and grant of  the defendants' motions to dismiss the complaints under  Federal Rule of Civil Procedure 12(b)(6) is de novo.  See  Kowal v. MCI Communications Corp., 16 F.3d 1271, 1276  (D.C. Cir. 1994).  Because the relevant legal analysis appears  in several comprehensive decisions of other circuit courts of  appeal, our analysis is brief.

9
To date, seven circuit courts of appeal have rejected claims  similar to those brought by the funds and the nations by  generally concluding that the alleged injuries are too remote  and, therefore, are not redressable for lack of proximate  cause.2 In Service Employees, the funds seek to distinguish  these cases principally on the ground that the circuits have  engaged in an overly mechanical analysis of proximate cause  and ignored congressional intent and important public policies underlying RICO.  Pointing to RICO's history and purpose,  see Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479, 519-20  (1985) (Marshall, J., dissenting), the funds maintain that  Congress intended to afford a remedy where, as here, in the  funds' words, "people, with common law claims, ... were not  able to adequately oppose an industry of companies conspiring together to commit misconduct more akin to the racketeering of organized crime than to garden-variety product  liability torts and isolated instances of fraud or deceit." Health care payors, by contrast, "were the type of business  entities that suffered ... economic injuries, and that had the  size and power to mount credible attacks as private attorneys  general to assist governmental law enforcement efforts." Therefore, Holmes, AGC, Illinois Brick Co. v. Illinois, 431 U.S. 720 (1977), and similar cases are distinguishable and  properly understood as the Supreme Court's effort to choose  among multiple possible plaintiffs that have suffered economic  injury and to select only the most efficient and directly  injured plaintiff.  Furthermore, the funds contend that a  proper analysis of the Holmes factors demonstrates that they  have standing to pursue their RICO claims against the tobacco industry.  In a somewhat similar vein, the nations contend  that the district court's conclusion in Guatemala failed to  recognize the unique status of the nations as foreign sovereigns seeking to protect their governments' treasuries  through parens patriae actions.

10
The funds and the nations err in assuming that the proximate cause analysis called for by AGC and Holmes is a quest  for the "best" (or, realistically, "least bad") plaintiff.  Rather,  the Supreme Court has insisted on an appropriate plaintiff,  namely, a plaintiff whose alleged injury possesses a sufficiently direct causal relationship to the alleged wrongdoing.  See  AGC, 459 U.S. at 533-35;  see also Holmes, 503 U.S. at 26870.  The problem for the plaintiffs arises from long-standing  common law principles which the Supreme Court has incorporated into the proximate cause requirement for purposes of  determining standing to bring RICO and federal antitrust  claims.

11
By relying on the analysis of RICO's legislative history set  forth in Justice Marshall's dissenting opinion in Sedima, 473 U.S. at 512-13, an approach rejected by the Court's majority,  id. at 497 n.15, the funds seek to show that in enacting RICO  Congress intended to adopt an analysis of the proximate  causation requirement different from that identified by the  Supreme Court in Holmes, 503 U.S. at 267-70.  There may  be some tension between the Holmes (RICO) factors, which  might be read simply to assert a single-factor direct-injury  test that is merely supported by several policy factors.  See  Holmes, 503 U.S. at 269, and the AGC (antitrust) approach,  which balances the directness concerns along with other  factors.  See AGC, 459 U.S. at 537-45.  This is not a pressing  issue here, however, because it is not outcome determinative  inasmuch as the funds and the nations lose under a pure  directness test and under a balancing of the Holmes factors.

12
The nations' assertion that they may proceed in parens  patriae is a dubious assertion at best, for as the First Circuit  pointed out in Estados Unidos Mexicanos v. DeCoster, 229 F.3d 332, 336 (1st Cir. 2000), parens patriae standing should  not be recognized in a foreign nation (by contrast with a State  in this country) unless there is a clear indication by the  Supreme Court or one of the two coordinate branches of  government to grant such standing.  The nations offer no  evidence of such intent.  In any event, they fail to show that  such status eliminates or adequately substitutes for proximate  cause.  Rather, the doctrine of parens patriae is merely a  species of prudential standing, see Md. People's Counsel v.  FERC, 760 F.2d 318, 321-22 (D.C. Cir. 1985), and does not  create a boundless opportunity for governments to seek recovery for alleged wrongs against them or their residents. See, e.g., Pfizer, Inc. v. Lord, 552 F.2d 612, 616 (8th Cir. 1975).

13
Even were the court to view as oversimplified the defendants' reliance on the settled rule barring direct suits by third  parties seeking to recover the costs of medical care paid on  behalf of individuals injured as a result of an alleged tortfeasor's conduct,3 application of the Holmes factors,4 503 U.S. at  269-70, reveals that both the funds and the nations fail to  demonstrate proximate cause.  With respect to the first  Holmes factor, the circuits have generally concluded that  damages for such claims are highly speculative and difficult to  calculate given the many other potential causes for the alleged financial injuries.  See Wash. Pub. Hosp., 241 F.3d at  703;  Allegheny, 228 F.3d at 441-42;5  Laborers Local, 191 F.3d at 239-40;  Oregon Laborers, 185 F.3d at 964-65;  Steamfitters, 171 F.3d at 928-29;  cf. Teamsters, 196 F.3d at 82324.  Regarding the second Holmes factor, the circuits have  concluded that allowing such claims to proceed would create a  risk of multiple recoveries and necessitate complicated rules  for apportioning damages between groups of plaintiffs removed at various levels from the tobacco industry's alleged  wrongdoing.  See Wash. Pub. Hosp., 241 F.3d at 703;  Teamsters, 196 F.3d at 823;  Laborers Local, 191 F.3d at 240-41; Oregon Laborers, 185 F.3d at 965-66;  cf. Allegheny, 228 F.3d  at 442;  Steamfitters, 171 F.3d at 933.  The third Holmes the  factor, the circuits have generally concluded, cannot outweigh  important policies underlying the first two Holmes factors,  see Steamfitters, 171 F.3d at 933-34;  see also Oregon Laborers, 185 F.3d at 964, and furthermore, individual smokers may  be counted on to vindicate the public interests at stake in the  third factor by asserting various theories of recovery against  the tobacco industry.  See Wash. Pub. Hosp., 241 F.3d at 703; Teamsters, 196 F.3d at 823;  Laborers Local, 191 F.3d at 241; Oregon Laborers, 185 F.3d at 964.  In addition, the circuits  have rejected the contention that specific intent is sufficient  to demonstrate proximate cause, see Allegheny, 228 F.3d at  439;  Laborers Local, 191 F.3d at 241-42;  Steamfitters, 171 F.3d at 925, or that the foreseeable nature of the harms  alleged is sufficient to satisfy the proximate cause requirement.  See Steamfitters, 171 F.3d at 926.  Furthermore, the  Ninth and Third Circuits have rejected efforts to distinguish  between third-party health care payors like the funds and  direct health care providers like the nations with respect to  the derivative nature of the harms alleged.  See Wash. Pub.  Hosp., 241 F.3d at 702-03;  Allegheny, 228 F.3d at 440-41.

14
We likewise hold that the harms alleged by the funds and  the nations are too remote from the defendants' alleged  wrongdoing to provide antitrust or RICO standing.  Neither  the funds nor the nations have shown that their claimed  economic harms were not caused by other independent factors or that difficult problems of duplicative recoveries or  allocation of damages could be avoided were they allowed to  proceed.  Indeed, as the defendants suggest, the alleged  harm arising from payment of medical expenses by the funds  and the nations is itself derivative of alleged injuries to  individual smokers, and the alleged "infrastructure" harms  are even more remote than the damages for medical payments because the potential for "infrastructure" harm does  not exist until an actuarially significant number of medical  payments on behalf of smokers has been made.  See Laborers  Local, 191 F.3d at 239;  Oregon Laborers, 185 F.3d at 963; Steamfitters, 171 F.3d at 927-28;  cf. Teamsters, 196 F.3d at  823-24.  Moreover, as the Seventh Circuit tellingly observed  in Teamsters, insurers are hard pressed to demonstrate financial harm flowing from the tobacco industry's alleged  wrongdoing because they possess information that would have  indicated a need to collect higher premiums from smokers. See Teamsters, 196 F.3d at 823-24, 826.

15
The remote, derivative nature of the alleged injuries, in  turn, makes more difficult the determination of the amount of  damages that is attributable to the alleged wrongdoing, as  distinct from other independent factors.  As the circuits have  pointed out, considerable speculation would be involved in  identifying the costs that have caused the alleged financial  instability of the funds and similar costs to the nations'  treasuries that the plaintiffs contend have deterred or prevented them from financing various health care programs. See Wash. Pub. Hosp., 241 F.3d at 703;  Allegheny, 228 F.3d  at 441-42;  Laborers Local, 191 F.3d at 239-40;  Oregon  Laborers, 185 F.3d at 964-65;  Steamfitters, 171 F.3d at 92830.  For example, it is difficult to know how smokers might  have behaved with more complete information, see Laborers  Local, 191 F.3d at 239-40;  Steamfitters, 171 F.3d at 929, a  problem compounded by the fact that the tobacco companies  would be stripped of many defenses that would be available in  a subrogation action.  See Teamsters, 196 F.3d at 823.  Reliance on aggregate statistical proof, as the district court in  Service Employees accepted (without prejudice to later attack  by defendants, see 83 F. Supp. 2d at 88), and as the nations  propose, compounds the difficulties and does not alter the  speculative nature of the claimed damages.  See Allegheny, 228 F.3d at 441-42; Oregon Laborers, 185 F.3d at 964-65; Steamfitters, 171 F.3d at 928-29;  cf. Teamsters, 196 F.3d at  823.  Moreover, the insurers have likely already passed the  costs on to the directly injured through higher premiums. See Teamsters, 196 F.3d at 824.

16
Allowing the funds and the nations to proceed would also  require complex rules for apportioning damages between  potential plaintiffs removed from the alleged wrongdoing by  different levels of injury, as well as create a very real  possibility of duplicative recoveries against the defendants. The need for complex rules apportioning damages arises  because other indirectly injured parties might also sue.  As a result, courts would be required to allocate damages among  various classes of directly and indirectly injured parties who  are removed from the alleged torts by varying degrees and  would be required to do so in a manner that protects the  tobacco industry from being held repeatedly liable for the  same alleged wrongdoing.  See Holmes, 503 U.S. at 273; AGC, 459 U.S. at 543-45;  Laborers Local, 191 F.3d at 240-41; Oregon Laborers, 185 F.3d at 965-66;  cf. Teamsters, 196 F.3d  at 823-24.  See generally Ill. Brick, 431 U.S. at 737-38.

17
The nations contend that because they are not private  insurers they cannot bring a subrogation action.  Further,  because they have assumed the responsibility of compensating the directly injured, they suggest that if they cannot  recover in this action for the alleged harms, no one can. Assuming the premise to be correct (and the nations' submissions are far from clear on the matter), the argument mistakenly assumes that it was Congress' intent that there must be  recoveries, regardless of the burdens inflicted on the legal  system and the significant policies captured in the first two  Holmes factors.  See supra p. 1073 n.4.  It seems especially  implausible that Congress would have wished to saddle the  United States judicial system with such burdens simply to  accommodate the legal idiosyncrasies of foreign nations.  To  the extent that such idiosyncrasies stand between the nations'  smokers and recoveries in United States courts, the nations  may wish to consider amendment of their domestic law.

18
Relatedly, because individual smokers may seek recoveries  for the same alleged conduct under state law theories and  because employers, other health insurers, and other similar  potential plaintiffs might also pursue similar antitrust and  RICO claims against the tobacco industry, double recovery  could occur.  See Wash. Pub. Hosp., 241 F.3d at 703;  Teamsters, 196 F.3d at 823;  Laborers Local, 191 F.3d at 240-41; Oregon Laborers, 185 F.3d at 966;  cf. Allegheny, 228 F.3d at  442.  The district court's contrary view in Service Employees, 83 F. Supp. 2d at 87-88, fails to take into account the  collateral source rule, see District of Columbia v. Jackson,  451 A.2d 867, 873 (D.C. 1982), and the limits of the single  satisfaction rule, see Lamphier v. Wash. Hosp. Ctr., 524 A.2d 729, 734 (D.C. 1987), which would not prevent multiple plaintiffs from obtaining duplicative recoveries from a single defendant for a single tort.  See Guatemala, 83 F. Supp. 2d at  131 n.3;  cf. Laborers Local, 191 F.3d at 241.

19
Virtually the same kinds of problems exist with respect to  the nations' claims.  See Wash. Pub. Hosp., 241 F.3d at 703; cf. Allegheny, 228 F.3d at 442;  Pfizer v. Lord, 522 F.2d at  619-20.

20
By its very nature, the common law proximate cause requirement adopted by the Supreme Court in Holmes and  AGC leaves open the possibility that "[s]ome injuries caused  by an antitrust [or RICO] violation may thus be left unremedied for lack of a proper plaintiff."  Oregon Laborers, 185 F.3d at 964.  See generally Ill. Brick, 431 U.S. at 745-47. The third Holmes factor, therefore, must be considered in the  context of the proximate cause analysis as a whole rather  than as a free-standing, independent ground for finding proximate causation.  Were satisfaction of the third Holmes factor  necessary, the proximate cause analysis would be transformed into a process for identifying the "best" plaintiff to  assert certain antitrust or RICO claims, in contravention of  AGC, 459 U.S. at 534-35.  Cf. Oregon Laborers, 185 F.3d at  964.  Like other circuits, we conclude that individual smokers  constitute a group of potential plaintiffs possessed of more  direct claims who can be counted on to deter the alleged  wrongdoing by asserting state law theories of recovery or  perhaps even RICO and federal antitrust claims to the extent  they can prove a measure of damages distinct from personal  injuries.  See Wash. Pub. Hosp., 241 F.3d at 703;  Teamsters, 196 F.3d at 823;  Laborers Local, 191 F.3d at 241;  Oregon  Laborers, 185 F.3d at 964;  Steamfitters, 171 F.3d at 933;  see  also Fed. Trade Comm'n v. Ind. Fed'n of Dentists, 476 U.S. 447, 461-62 (1986);  Reiter v. Sonotone Corp., 442 U.S. 330,  339 (1979).

21
The funds' and the nations' reliance on the purportedly  foreseeable nature of their injuries and the allegedly intentional nature of defendants' wrongdoing is misplaced. "[F]oreseeability and direct injury (or remoteness) are distinct concepts, both of which must generally be established by  a plaintiff."  Laborers Local, 191 F.3d at 236;  see also  Steamfitters, 171 F.3d at 926.  Defendants suggest that substitution of the former for the latter would enable circumvention of the settled rule that one who pays the medical  expenses of another may not recover those expenses in a  direct suit against the tortfeasor but must proceed by way of  subrogation.  In any event, specific intent to harm the plaintiffs by shifting smoking-related health care costs to them is  alone insufficient to overcome the bar on remote claims.  See  AGC, 459 U.S. at 537 & n.37;  Blue Shield of Va. v.  McCready, 457 U.S. 465, 478-79 (1982);  Laborers Local, 191 F.3d at 241-42;  Steamfitters, 171 F.3d at 925.

22
Accordingly, because the funds' and the nations' claims are  "too remote, contingent, derivative, and indirect to survive,"  Guatemala, 83 F. Supp. 2d at 130,6 we reverse the denial of  the motion to dismiss the RICO and fraud claims in Service  Employees, and we otherwise affirm the dismissals of the  complaints in Service Employees and Guatemala.

Notes:

1
  By unpublished order, the district court dismissed the complaints of Nicaragua and the Ukraine for the reasons in Guatemala.

2
  Lyons v. Philip Morris Inc., 225 F.3d 909 (8th Cir. 2000); United Food and Commercial Workers Unions, Employers Health  and Welfare Fund v. Philip Morris Inc., 223 F.3d 1271 (11th Cir.  2000);  Tex. Carpenters Health Benefit Fund v. Philip Morris Inc.,  199 F.3d 788 (5th Cir. 2000);  Int'l Bhd. of Teamsters, Local 734  Health and Welfare Trust Fund v. Philip Morris Inc., 196 F.3d 818  (7th Cir. 1999) ("Teamsters");  Laborers Local 17 Health and Benefit  Fund v. Philip Morris Inc., 191 F.3d 229 (2d Cir. 1999) ("Laborers  Local");  Oregon Laborers-Employers Health & Welfare Trust  Fund v. Philip Morris Inc., 185 F.3d 957 (9th Cir. 1999) ("Oregon  Laborers");  Steamfitters, Local Union No. 420 Welfare Fund v.  Philip Morris Inc., 171 F.3d 912 (3d Cir. 1999) ("Steamfitters");  see  also Ass'n of Wash. Public Hosp. Dists. v. Philip Morris Inc., 241 F.3d 696 (9th Cir. 2001) ("Wash. Pub. Hosp.");  Allegheny Gen.  Hosp. v. Philip Morris Inc., 228 F.3d 429 (3d Cir. 2000) ("Allegheny").

3
  Cf. Indus. Risk Insurers, 746 F.2d at 528;  Rock Island Bank, 692 F.2d at 1106-07;  Great Am. Ins. Co., 575 F.2d at 1033-34.

4
  In explaining that the common law required "some direct  relation between the injury asserted and the injurious conduct  alleged," Holmes, 503 U.S. at 268, the Supreme Court characterized  its decision in AGC as identifying three relevant considerations:  (1)  the need for sufficiently direct factual causation in order to be able  "to ascertain the amount of a plaintiff's damages attributable to the  violation, as distinct from other, independent, factors";  (2) the  avoidance of "complicated rules apportioning damages among plaintiffs removed at different levels of injury from the violative acts [so  as] to obviate the risk of multiple recoveries";  and (3) the assurance  that "directly injured victims can generally be counted on to vindicate the law as private attorneys general, without any of the  problems attendant upon suits by plaintiffs injured more remotely." Id. at 269-70 ("the Holmes factors").

5
  The decisions of the Third and Ninth Circuits in Allegheny  and Washington Public Hospital are instructive with respect to the  nations' claims because, like the nations, the plaintiffs in both cases  were legally obligated to directly provide health care to smokers  who could not afford to pay for such services.  See Wash. Pub.  Hosp., 241 F.3d at 700;  Allegheny, 228 F.3d at 436, 443.

6
  The failure of the funds and the nations to demonstrate  proximate cause under Holmes with respect to their RICO and  federal antitrust claims also means that their antitrust and common  law claims under District of Columbia law fail for lack of proximate  cause.  See McKethean v. Wash. Metro. Area Transit Auth., 588 A.2d 708, 716 (D.C. 1991);  Lacy v. District of Columbia, 424 A.2d 317, 321 (D.C. 1980);  see also Wash. Pub. Hosp., 241 F.3d at 70607;  Allegheny, 228 F.3d at 445-46;  Teamsters, 196 F.3d at 827-28; Laborers Local, 191 F.3d at 242-43;  Oregon Laborers, 185 F.3d at  968-69;  Steamfitters, 171 F.3d at 934-37.