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EUROPEANS SUING BIG TOBACCO IN U The European Commission said today that it had filed a civil lawsuit in the United States against the Philip Morris Company and the R. J. Reynolds Tobacco Company seeking damages for what it called their involvement with organized crime in smuggling cigarettes into Europe. In announcing the suit in Brussels today, the executive body of the European Union accused the two tobacco companies of using money laundering, wire fraud and other activities in ''pursuit of a massive, ongoing page Officials at Philip Morris and R. J. Reynolds said they had not reviewed the suit, which ran 188 pages, but they denied any involvement with smugglers. They also raised questions about why the suit had been filed in the United States. The case is only the latest sign of frustration among government officials in Europe who believe that they are losing billions of dollars in customs and tax revenues because of illicit sales of American cigarettes that officials believe involve American manufacturers. The British government has opened an investigation into British American Tobacco, the world's No. 2 tobacco company, which it suspects of illegally importing cigarettes into Britain. And officials at the European Union said several of the 15 Western European nations that make up the union would probably file suits of their own over the loss of revenue. Italy said today that it planned to join the suit, which was filed in Federal District Court in Brooklyn on Friday. Nor has the issue escaped the notice of Justice Department officials in the United States. A federal grand jury in North Carolina has been investigating allegations that tobacco companies have been knowingly selling to dealers who resell American cigarettes to smuggling rings that infiltrate European countries. Faced with little or no growth in sales in the United States, American tobacco companies have been aggressively expanding their overseas sales and marketing. But American brands, subject to various taxes and import duties, are expensive -- as much as $6.67 a pack in Norway -- and smugglers are increasingly avoiding duties by illegally bringing cigarettes into markets like Spain and Italy and selling them for 20 to 30 percent less than the legal price. The European Commission said it was seeking financial compensation for what the suit claimed was billions of dollars in tax loses the European governments have suffered, as well as injunctive relief to prevent further smuggling. It did not claim a specific amount of damages. But experts have estimated that the countries that make up the European Union lose about $1.5 billion a year in taxes and duties because of black market cigarettes. In a statement, the union's budget commissioner, Michaele Schreyer, said the suit represented a new strategy to fight fraud and financial irregularities. It maintains that the two companies breached the United States Racketeering Influenced and Corrupt Organization Act (RICO) by involvement with smuggling rings. Industry analysts say the vast discrepancy in taxes on cigarettes in Europe makes the Continent an easy target for smugglers. In 1999, for instance, American cigarettes were selling for $1.75 in Spain and $5.25 in Britain. Since the European Union has open borders, transporting cigarettes from low-tax to high-tax countries is easy, the analysts say. European governments have also blamed American manufacturers, saying they have sold cigarettes to distributors who admit that they are selling them to smugglers. The lawsuit announced today repeats that claim and provides some detailed descriptions of smuggling activity that has brought thousands of cases of American cigarettes to Spain during the 90's. It also maintains that company officials have devised elaborate schemes to move cigarettes into Europe and accused top Philip Morris executives of ordering the systematic destruction of documents related to smuggling. In one example, the suit claims that R. J. Reynolds would sell cigarettes from its offices in Miami to a Panamanian company that would arrange for the cigarettes to be shipped to a warehouse in Rotterdam. There, paperwork would be generated to show that the cigarettes were intended for the Canary Islands. In fact, they went by truck to Barcelona. American tobacco companies have consistently resisted efforts to obtain the names of international customers, European prosecutors have said. Some health advocates applauded the decision to file the case. ''I think it is long overdue,'' said Dr. Ron Davis, the former editor of Tobacco Control, a British scientific magazine. ''There is growing evidence that the cigarette manufacturers are involved in the smuggling.'' But whether the strategy will succeed is unclear. Some industry analysts said the suit would be thrown out on jurisdictional grounds. ''What are they doing in Brooklyn?'' said David J. Adelman, a tobacco industry analyst with Morgan Stanley Dean Witter. wants to take advantage of the American legal system. But what is the connection? This is a little like taking a murderer from France and wanting to try him in Texas because it has the death penalty.'' Others said the American lawyers who filed the suit were looking for a sympathetic judge. The Federal District Court in Brooklyn has several liability cases pending against American cigarette companies, and Jack B. Weinstein, a senior judge, is known for handling cases seeking damages from the companies. The European case has been assigned to Judge Viktor V. Pohorelsky. Analysts said the union would have great difficulty proving how much money had been lost, and still others suggested that the lawsuit was at least partly a result of the European Commission's frustrations in dealing with the cigarette industry as a whole. A recent initiative to curb cigarette advertising in Europe was struck down by a European court. In its brief statement, R. J. Reynolds said that to suggest that it has been involved in smuggling in Europe or elsewhere was insupportable and untrue. Philip Morris Europe said it questioned why the Europeans sued in the United States. ''We are convinced that the far better approach would be for the commission and all other interested parties to work together in the fight against trade in contraband, including counterfeit products, and we remain ready to cooperate with the European Commission and the member states in that regard,'' said David R. Davies, the company's vice president for corporate affairs. In his statement, Mr. Davies also said Philip Morris ''would vigorously contest the commission's unprecedented attempt to utilize American courts to impose liability upon us.'' Trying to use the American courts to address smuggling has been tried before by Canada. Last year, Canada sued R. J. Reynolds for $1 billion in Federal District Court in Syracuse, maintaining that the company conspired to smuggle tobacco products into Canada to avoid taxes. The lawsuit contended that the company had set up a network of smugglers and offshore companies to flood Canada with cheap cigarettes after the government doubled taxes and duties on tobacco. Canada later lowered the taxes after it said it could not combat a wave of smuggling from the United States. The case was dismissed in July by a judge who ruled that American courts cannot be used to collect another country's taxes. Lawyers for Canada have appealed.