Philip Morris Wins Illinois Supreme Court Tobacco Case
The Illinois Supreme Court on Thursday ruled 4-2 in favor of Philip Morris USA in a $10.1 billion class-action lawsuit alleging that the company misled consumers about the risks of "light" cigarettes, the AP/Houston Chronicle reports (Nowell, AP/Houston Chronicle, 12/15). The victory for Philip Morris, a subsidiary of Altria, is "a major blow to tobacco foes," the Chicago Tribune reports.
Justice Rita Garman in the majority opinion wrote that if the Federal Trade Commission "has specifically authorized the use of the terms 'lights' and 'lowered tar and nicotine' by (Philip Morris USA) in its labeling and advertising, (the firm) may not be held liable under the Consumer Fraud Act, even if the terms might be deemed false, deceptive or misleading."
Justice Charles Freeman in the minority opinion wrote that the court's decision "serves not only to dilute needlessly the force of our state consumer protection legislation, but to limit unnecessarily our state's citizens' consumer protection in this area to a federal agency" (Sachdev, Chicago Tribune, 12/16).
The plaintiffs were not seeking damages for any health effects caused by the cigarettes, but rather sought reimbursement for products that they claimed did not deliver on advertised promises of reduced risks, the Los Angeles Times reports.
Plaintiffs' attorney Stephen Tillery said he was "terribly disappointed" with the ruling, adding that his team is considering a petition for a rehearing or an appeal to the U.S. Supreme Court (Levin, Los Angeles Times, 12/16).
Carl Tobias, a law professor at the University of Richmond, said, "I think that (Philip Morris) can take some comfort from this victory. It does seem like this could dissuade individuals from pursuing them vigorously in other states" (AP/Baltimore Sun, 12/16).
Richard Daynard, a professor at Northeastern University School of Law, said, "Obviously Philip Morris has reason to be very happy, ... but I think it's important for investors and others to understand that there is another state Supreme Court ruling that goes exactly the opposite way." Daynard was referring to a 2004 Massachusetts Supreme Court ruling that allowed a similar class-action case against the company. Philip Morris faces 24 additional state lawsuits over the marketing of light cigarettes (Richmond Times-Dispatch, 12/16).
"The suit was less about smoking than about lawyers testing whether consumer fraud laws can be interpreted to permit recovery even when the claimants haven't suffered any actual damages," a Wall Street Journal editorial states. The editorial concludes that the U.S. needs "more rulings like the one yesterday before the tort bar stops its marauding" (Wall Street Journal, 12/16).
Several broadcast programs reported on the verdict:
- APM's "Marketplace": The segment includes comments from Daynard; Dawn Schneider, spokesperson for Philip Morris; Tobias; and Gregg Warren, equity analyst for Morningstar (Palmer, "Marketplace," APM, 12/15). The complete segment is available online in RealPlayer.
- NPR's "All Things Considered": The segment includes comments from Daynard; Harold Krent, dean of the Chicago-Kent College of Law; Joe Power, attorney for the plaintiffs; and Schneider (Corley, "All Things Considered," NPR, 12/15). The complete segment is available online in RealPlayer.
- PBS' "Nightly Business Report": The segment includes comments from Mary Aronson, tobacco litigation and policy analyst; Warren; and George Zelcs, attorney for the plaintiffs (Gersh, "Nightly Business Report," PBS, 12/15). The complete transcript is available online.