California Appeals Court Reduces Punitive Damage Award in Smoker Lawsuit to $10.5 Million

Citing recent U.S. Supreme Court decisions regarding high punitive damage awards, a California appellate court on Thursday reduced a $26.5 million damage award to a former California smoker to $10.5 million, the San Francisco Chronicle reports (Egelko, San Francisco Chronicle, 9/26). In the lawsuit, Patricia Henley, who smoked Marlboro cigarettes from the early 1960s to 1997, when she was diagnosed with lung cancer, alleged that Philip Morris USA concealed evidence about the risk and addictiveness of its products. A San Francisco jury in 1999 awarded her $1.5 million in compensatory damages and $25 million in punitive damages. However, the California Supreme Court in June ordered an appellate court to review the 1999 ruling to comply with two U.S. Supreme Court decisions in April and May that ordered reviews of cases with high punitive damage awards. The Supreme Court rulings did not specify an "absolute formula" to determine what punishment is reasonable, but the court did suggest that punitive damage awards be no more than nine times the amount of other damage awards in the case and that a company's wealth should not be a factor in a jury's decision (California Healthline, 6/26). The appellate court said that $9 million in punitive damages is justified because of Philip Morris' "extraordinarily reprehensible conduct" in exploiting children for profit, the Chronicle reports. Henley began smoking at age 15 (San Francisco Chronicle, 9/26). Philip Morris announced that it intends to appeal the decision to the California Supreme Court. William Ohlemeyer, associate general counsel for Philip Morris, said, "We have long maintained that these punitive damage awards are excessive, unconstitutional and should be set aside." Henley has not yet decided whether to appeal (Los Angeles Times, 9/27).