ABC-Philip Morris Libel Suit Still Smolders

PHILIP MORRIS got more than an apology from ABC. Now, the tobacco company won't have to cough up thousands of pages of internal documents about its own research into nicotine and details of how it manufactures cigarettes.

Yesterday, Virginia State Circuit Court Judge Theodore Markow ordered the return of sealed documents to Philip Morris after ABC and its ''Day One'' news magazine settled the tobacco company's $10- billion defamation suit with an apology. ABC had alleged that the company ''artificially spikes'' its cigarettes with nicotine.

Making the documents public at a trial could have raised embarrassing issues for Philip Morris. This week, Rep. Henry Waxman (D) of California plans to ask the company to release the documents anyway. ''That way the public will not have to rely on blanket statements, but the documents themselves,'' says Phil Schiliro, a spokesman for Representative Waxman.

Tobacco-industry documents, which have been leaked to the press or Congress over the past year, have already been embarrassing. Waxman, for example, recently obtained Philip Morris documents that showed the company studied nicotine's effect on the human body. In addition, Waxman recently disclosed that Philip Morris has researched the optimum level of tar and nicotine in cigarettes.

Antitobacco advocates bemoaned the return of the Philip Morris documents to the company. ''There are thousands of documents under seal, so the news media and the public are therefore shortchanged, and we may never know what Philip Morris is hiding,'' says Cliff Douglas, president of Tobacco Control Law & Policy Consulting in Chicago.

Philip Morris maintains that any documents would have proved its contention that it does not add nicotine in any measurable amount from any outside source in the manufacturing process. ''We would have won the case had it been tried with the documents in evidence,'' says Charles Wall, senior vice president and deputy general counsel for Philip Morris.

Mr. Wall denies that Philip Morris is hiding anything by not releasing documents. He says the company will not respond to Waxman's request. ''Henry Waxman does a job of releasing documents on his own and then misquotes them,'' Wall says.

Before the settlement, there were intimations that ABC's lawyers, in the discovery phase of the case, might have found some ''smoking guns.''

''The rumors were quite devastating that they had found the kind of stuff released by Waxman,'' says Richard Daynard, head of the Boston-based Tobacco Products Liability Project.

Last month, in a request for a summary judgment, ABC's lawyers argued that Philip Morris documents showed that the company buys nicotine extract to add to reconstituted tobacco for its domestic cigarettes. Reconstituted tobacco is a filler that includes stems and crushed leaves with a lower nicotine content.

Document discovery was an incendiary process. ABC's lawyers complained that Philip Morris was stonewalling by claiming many of the documents were trade secrets. When Philip Morris finally did send over documents, the company used paper that could not be photocopied because of its red color.

Despite the order to return the documents to Philip Morris, Mr. Daynard believes the information will surface again, probably during a tobacco-products liability lawsuit or in Food and Drug Administration proceedings. President Clinton recently asked the FDA to regulate tobacco to protect underage smokers from the addictive effects of nicotine.

The ABC story may have played a part in motivating the FDA to regulate tobacco. Immediately after the broadcast, the FDA became interested in the issue of cigarettes as nicotine delivery systems.

''It framed the whole larger debate that led to the larger decision to protect children,'' says Dr. Gregory Connolly, head of the Massachusetts Tobacco Control Board, a state organization in Boston.