State Court Vacates Tobacco Judgement
The six-judge Florida Supreme Court on Thursday upheld a state appeals court decision to vacate a $145 billion punitive damages award in a class-action lawsuit filed against tobacco companies, the South Florida Sun-Sentinel reports (Burstein, South Florida Sun-Sentinel, 7/7).
In 2003, a three-judge panel of the 4th District Court of Appeals in West Palm Beach, Fla., vacated the $145 billion punitive damages award on the basis that the award was unconstitutional and would bankrupt the tobacco companies in violation of the state law.
In the case, the first U.S. class-action lawsuit filed by smokers, lead plaintiff Howard Engle and five co-plaintiffs represented thousands of Florida smokers against Brown and Williamson, the Liggett Group, Lorillard, Philip Morris USA, R.J. Reynolds and two tobacco industry trade groups. In a 68-page opinion, the panel ruled that the judge in the original trial, which began in 1998, should not have certified the lawsuit as a class action because each smoker "had started smoking and continued to smoke for a different reason."
The panel also ruled that the punitive damage award was excessive and violated an agreement between the state and the tobacco industry made as part of the national tobacco settlement (American Health Line, 11/5/04).
In a 79-page decision, the state Supreme Court agreed that the $145 billion punitive damages award "is excessive as a matter of law" because "it would bankrupt some of the defendants" (Levin/Selvin, Los Angeles Times, 7/7). The court also agreed that the cases of the smokers "are highly individualized" and "do not lend themselves to class-action treatment" (Warner, New York Times, 7/7).
However, the court overturned a decision by the state appeals court panel to vacate an almost $7 million compensatory damages awarded to two plaintiffs in the lawsuit. In addition, the court upheld conclusions by the jury that the tobacco companies misled the public about the health risks of smoking and addictiveness of cigarettes, that smoking can cause heart disease and several other conditions and that nicotine is addictive (Los Angeles Times, 7/7).
The court also ruled that individual smokers can file lawsuits against the tobacco companies (Kallestad, AP/Washington Post, 7/7).
According to the New York Times, the decision by the state Supreme Court to uphold the conclusions of the jury "means any new case filed in Florida can start with those claims already proved" (New York Times, 7/7). The decision "could reduce the time and expense of trials and increase the number of lawsuits" filed in Florida against tobacco companies, the Los Angeles Times reports.
Lead plaintiff attorney Stanley Rosenblatt said that in the past attorneys often have decided not to file lawsuits against tobacco companies on behalf of individual smokers because "they will smother you in money and time." However, with the decision, "an individual case can be tried in a week," he said (Los Angeles Times, 7/7).
Charles Blixt, general counsel for R.J. Reynolds, said, "There's always been the potential for large numbers of individual lawsuits being filed," adding, "I think it's proven that we can defend successfully against those kinds of cases" (New York Times, 7/7).
APM's "Marketplace" on Thursday reported on the state Supreme Court decision. The segment includes comments from John Coffee, a professor at Columbia University Law School; Marc Gottlieb, director of the Tobacco Products Liability Project at Northeastern University; and Gregg Warren, an analyst for Morningstar (Palmer, "Marketplace," APM, 7/6).
The complete transcript and audio of the segment in RealPlayer are available online.